Fly GLO (New Orleans International) has moved from Chapter 11 protection to Chapter 7 liquidation, leading to a sell off of non-exempt assets, reports the New Orleans Advocate. GLO has been under Chapter 11 bankruptcy protection since April 2017.
GLO suspended operations on July 15 following a dispute with its capacity provider Corporate Flight Management (CFM). CFM had operated three Saab 340Bs for GLO on a network spanning New Orleans International, Shreveport Regional, Huntsville International, Little Rock, Destin-Fort Walton Beach, and Memphis International. CFM claims that GLO has unpaid invoices totalling USD350,000, plus a USD500,000 security deposit.
On August 1, acting trustee Henry G. Hobbs Jr. filed a motion to liquidate the carrier, saying that "there is no longer a business to reorganise." The motion was approved on September 1.
Additionally, Hobbs alleges that GLO founder and CEO Trey Fayard grossly mismanaged the company and engaged in fraudulent activity, a claim which Fayard's attorney, William Steffes, strongly denies. Hobbs also questioned the necessity of paying Fayard a monthly salary of USD7,500.
A trustee will now be appointed to oversee the sale of GLO's assets.
