Sources: Last-Minute Funding Deal Comes Through
UPDATE 11.14.08 1415 MST: Workers at Eclipse Aviation
will soon receive the paychecks that 24 hours ago they feared would
not materialize... though it's still not clear how much longer they
will be able to count on that.
Based on available information -- precious little of which has
come from Eclipse itself, as the company still refuses to comment
publicly on recent developments -- Eclipse was able to secure a
short-term loan to cover payroll for the previous pay period, which
ended November 8.
A recorded message at the 800 number given to Eclipse employees
Thursday states that money will be in their checking accounts by
Tuesday, November 18. Where that money is coming from is still not
known... though it appears this funding was not the reported
$200-$300 million Eclipse states it needs to continue
On Friday morning, before news of the funding became known,
Albuquerque Mayor Martin Chavez said he had spoken with Peg
Billson, VP of Manufacturing at Eclipse, who told him she was
confident the issue involving employee pay would be resolved
"They're looking at much more than paying the employees. They're
looking at the survival of the company," Chavez told KRQE-13 Friday
morning. "This round of financing, which they believe to be-if I
recall correctly-$200 million to $300 million, which they think is
Chavez also revealed Eclipse owes the city some $200,000 in back
rent for its facilities at the Albuquerque International
Also on Friday, three more Eclipse customers filed lawsuits
against the company, accusing Eclipse of not refunding deposits on
their aircraft owed to them under purchase contracts signed prior
to the May price increase that raised the purchase price of an
Eclipse 500 to $2.15 million.
As ANN reported, purchasers still waiting for
their aircraft and who had not yet made their majority payments
were allowed under contract to ask for refunds.
To date, at least seven buyers have sued Eclipse, stating
they're still waiting for those refunds that were promised to
MST: Aero-News has learned Eclipse Aviation has
apparently pulled its umpteenth rabbit out of a hat... and has
obtained last minute funding that, at the very least, will cover
payroll for Eclipse workers in New Mexico, New York, and
Independent reports to ANN have been collaborated by local
media. At this time, few details are available... including the
source of the funding, and the amount.
Needless to say, ANN will provide more details as they become
11.13.08 1545 MST: Workers at Eclipse Aviation
-- already told not to expect their paychecks owed for the past two
weeks -- were told Thursday to head home, and await further
Aero-News has spoken to a number of sources familiar with the
matter, on background. The consensus is that Eclipse is now
desperately working to secure a "Hail Mary" round of funding that
would keep the planemaker in operation. The outcome of those
efforts may be known within the next 24-72 hours.
It is not clear what other measures -- if any -- Eclipse
executives are now pursuing in order to stay in business... or
whether a possible bankruptcy filing is on the horizon.
Eclipse employees apparently weren't the only ones caught by
surprise Thursday morning. State Economic Development
Secretary Fred Mondragon told New Mexico Business Weekly he was
told of the developments by a third party.
"I heard from an Eclipse contractor this morning that they
gathered employees together and told them they could not make
payroll, so they were sent home, because they can’t ask
people to work without pay," Mondragon said. "The contractor said
the assembly staff is not working and the assembly line is
apparently shut down.
"I understand the banks put a squeeze on the company, freezing
their cash assets," Mondragon added. "The news is not good."
In related news, Aero-News has also heard reports of an imminent
Chapter 7 filing for DayJet, which may come as soon as Friday.
DayJet -- the largest single customer for the Eclipse 500
ceased operations September 19.
1000 MST: The parking lot in front of Eclipse
Aviation headquarters off Clark Carr Loop remains mostly full
Thursday morning, hours after workers were told they would not be
paid for their last two weeks of work... but one must wonder
whether that will be the case for much longer, unless an 11th-hour
funding miracle comes through.
Perhaps most telling is the fact the lot in front of Sunport
2 -- Eclipse's primary assembly facility -- had only
about 15 percent of available spaces filled (shown below) on
what normally would have been a busy weekday morning.
Despite the glum news, at least one Eclipse employee remained
optimistic. The worker, who declined to give his name, said "there
were no layoffs" Thursday morning, adding his understanding of the
problem was that "one bank refuses to give another bank the money
"I love working here," the employee added. "I'd work here
without a paycheck."
Judging by those empty spaces -- as well as the three workers
seen by ANN leaving the headquarters building, carrying what
appeared to be their belongings -- not everyone at Eclipse shares
A request for comment from an Eclipse spokesperson has not been
0835 MST: From Albuquerque -- Barring
a financial miracle, it appears to be another nail in the coffin
for Eclipse Aviation. The struggling planemaker told third shift
workers Thursday morning their paychecks due on the 15th of this
month will not be honored, as the company continues to fight to
secure desperately needed funding.
770-KKOB reports first-shift workers filing into
Eclipse's production facility are being given the bad news as
this is written, two hours after their late-shift counterparts were
given the news. KOB-TV added several workers were seen "speeding
out of the facility's parking lot" following that meeting.
Workers were reportedly given a sheet of paper with a toll-free
phone number to call for updates on the status of their paychecks,
which cover the last two weeks of labor.
KOB-TV adds some employees said they were told executives
'stayed up into the early morning hours' trying to find a way to
honor their paychecks, but were apparently unsuccessful in doing
At this time, Eclipse is still in business... though the sword
of Damocles certainly appears to be descending.
ANN will follow this story, and will update it when any more
information becomes available.