Fly GLO (New Orleans International) has filed for US Chapter 11 bankruptcy protection citing at least twenty unsecured creditors the airline owes more than USD3 million.
Documents lodged with a US Federal bankruptcy court in New Orleans on Sunday, April 24, show the decision to file for bankruptcy came after operating carrier Corporate Flight Management (Smyrna) threatened to terminate its contract with GLO from Thursday, April 27, onwards citing USD350,000 in unpaid invoices dating back to March and as well as a USD500,000 security deposit.
GLO charters three Saab 340Bs from Corporate Flight Management for use in flying from New Orleans to Shreveport Regional, Huntsville International, Little Rock, Destin-Fort Walton Beach, and Memphis International.
The Times-Picayune newspaper reported on Tuesday, April 25, that GLO had reached an agreement with CFM, allowing it to continue offering all of its flights for the foreseeable future as it restructures its operations. Court documents show the airline has 120 days to submit a formal reorganization plan to the court.
GLO's assets and liabilities are between USD10-50 million.
"It was a difficult decision, but a necessary one to protect everyone involved," CEO Trey Fayard said in the statement. "We look forward to promptly and successfully emerging from reorganization in the near future."
