Gyroplanes Builder, Groen Brothers Aviation Reaches Agreement With
By Bill Goldston
May 2, 2012 - Groen Brothers Aviation (GBA) announced
that it has reached an agreement with its creditors for
a major financial reorganization of the Company. The
restructuring will result in the elimination of all of
the Company's debt obligations, which currently exceed
GBA is a U.S. corporation that designs vertical takeoff
and landing (VTOL) rotorwing gyroplanes and gyrodynes.
GBA's vertical lift rotorcraft technologies enable
aircraft to be runway-independent and not constrained by
physics-imposed speed, range, and payload limitations of
In this transaction, GBA will transfer substantially all
of its assets, notably all of its technologies,
know-how, and associated patents into a new private
entity to be formed by GBA, which is expected to be
called "Groen Brothers Aviation Corporation" (GBAC).
Complementing this action by GBA, these creditors have agreed to
exchange essentially all of their debt instruments for a
majority ownership of common stock in GBAC which permits
ownership of 4% of GBAC common stock to remain with GBA.
Robin Wilson, Company Director for the past four years, stated,
"We are very fortunate to have creditors who believe in moving
GBA technology development forward, instead of requiring a
liquidation of assets as has been commonly witnessed in the
aviation industry over the past five years."
David Groen, the Company's Founder and CEO for the past
twenty-two years, stated, "The worldwide economic contraction
over the past five years has been devastating for countless
companies. These events caused us to lose our coveted position
as lead contractor in a significant DARPA contract, which
negatively impacted interest in GBA from the equity markets.
Despite the difficult financial challenges we faced during this
period, we have been fortunate to have creditors who understand
and believe in the GBA vision: worldwide use of GBA's sustained
autorotative flight technologies.
?The Company does not have, nor has it had, the hundreds of
millions of dollars which our vision requires in order to be
achieved. Through our creditors, the GBA vision and products may
now be realized, and our common shareholders will have an
interest in GBAC. With the substantial investment that is
anticipated to be applied to advanced technology development, we
believe GBA could still achieve considerable asset appreciation
in the future."
The Company today filed an SEC Form 8-K Significant Events Statement and
an SEC Form 14C Information Statement with the U.S. Government that
describes the transaction, noting that approval for the transaction has
already been received from the holders of a majority of its voting
Groen Brothers Aviation, Inc. has been developing gyroplane technology
since 1986 and is recognized as the world's leading authority on
sustained autorotative flight. Powered by a Rolls-Royce gas turbine
engine, GBA developed the world's first commercially viable modern
gyroplane -- the first "autogiro" to utilize a jet engine -- the Hawk 4
Gyroplane. The Hawk 4 was used extensively for security aerial patrol
missions during the 2002 Winter Olympics in Salt Lake City.
GBA announced in October 2005 that DARPA, an arm of the United States
Department of Defense, awarded a contract to GBA to form and lead a team
to design a proof of concept high-speed, long-range, vertical takeoff
and landing (VTOL) aircraft designed for use in combat Search and Rescue
This modern rotorcraft, named by DARPA as the "Heliplane," was designed
to exploit GBA's gyrodyne technology; offering the VTOL capability of a
helicopter, the fast forward flight of an airplane, and the safety,
simplicity, and reliability of a GBA gyroplane.
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