💥New Chapter 11 Bankruptcy Filing - Aerotech Miami Inc. (d/b/a iAero Tech)💥
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On September 19, 2023, Aerotech Miami Inc. d/b/a iAero Tech and 15 affiliated debtors (collectively, the "debtors") filed chapter 11 bankruptcy cases in the super hot (literally) and well-trafficked venue, the Southern District of Florida (Judge Mark). The debtors are a B2B “unscheduled” charter airline with a fleet of 42 passenger and cargo aircraft; they offer both domestic and international service; and they primarily service customers in the government (e.g., US Department of Homeland Security or “DHS”), sports and entertainment (e.g., the National Hockey League and college sports teams), leisure (e.g., Cuba travel companies), and cargo (e.g., DHL) sectors.
Despite a track record of decades of experience and high profile customers, the debtors have struggled of late. The pandemic certainly didn’t do any favors but beyond that, you’ve got a hodgepodge of (i) mismanagement by the former leadership (which may or may not have included misappropriation of company funds/assets, fraud, and potential violations of the FCPA, among other issues), (ii) unprofitable agreements, (iii) an adverse $29mm arbitration awards rendered against them (in favor of a company called Private Jet Services Group or “PJS” which has made great efforts to enforce its rights in Florida including the attempted seizure of funds in a certain debtor’s bank accounts), and (iv) the temporary cessation of flight services for the DHS due to mishandled contract extension (which cost the debtors between $4-$8mm, depending on how you want to look at it). Stir all that sh*t up and you’ve got sh*t punch, especially when you factor in the fact that the company has $860mm of secured debt, of which $75mm matures at year end. 😳😬
Which gets us to the bankruptcy.