Fulfills Important Requirement of Reorganization Plan
On February 23, the
Mooney Aerospace Group, Ltd., issued 10 million shares of new
common stock to Mooney stockholders and creditors. This is a
milestone in the fulfillment of its Chapter 11 reorganization plan.
Some creditors who were not included in this group have the option
to convert their credits to Mooney stock. If all of these other
creditors -- secured debenture holders, airplane note holders, and
factoring note holders -- chose to take Mooney stock, the company
would issue another 13.5 million shares.
Initially listed at $3.50, the new symbol, MNYG.OB, closed
unchanged but opened at $2.50 on February 24. What appeared to be a
$1 drop was probably an artifact of extremely low trading volume
(only 1,170 shares). Most of those receiving the new shares cannot
trade them before March 15. Only the common stockholders as of
December 15, who received 200,000 shares altogether, may sell them
before March 15. President J. Nelson Happy explained that the rest
of the new stock, "is restricted, in that none of these shares can
be sold into the market until March 15, 2005, and then only 10% of
each shareholder's shares can be sold each month."
Why only 200,000 shares of common stock? Through a reverse
split, 3,223 of the old shares turn into one of the new ones.
Similarly, the entire outstanding amount of the old preferred stock
shares turned into a total of 200,000 shares of the new common
stock.
"Our existing shareholders that have not already done so should
submit their shares to our stock transfer agent, American Stock
Transfer and Trust Co., 59 Maiden Lane, Plaza Level, New York, NY
10038 (phone 800-937-5449), by a traceable method such as certified
mail or through their stock broker."
Mooney Aerospace Group, Ltd. is the latest iteration of the
endless drama of holding companies that have controlled Mooney
Airplane Company of Kerrville (TX). ANN has lost count of the
number of reorganizations and bankruptcies of the old firm, which
was started by Al Mooney and Charles Yankey in Wichita in 1946 and
moved to Kerrville in 1953. The current version came about when
AASI, Inc. took over a floundering Mooney in an attempt to buttress
its flagging JetCruzer 500 project. Over the years, Mooney has
managed to build over 10,000 airplanes, of which the company says
7,000 are still flying in the USA and 1,000 more abroad.
The reason Mooney keeps coming back is simple -- the product.
Mooney pilots are fanatically loyal, and the slender planes with
the "backwards tail" have an efficiency that appeals to many of the
quantitatively-oriented detail fiends that populate the world of
aviation. Nothing certified goes as fast on as little gas, and
Mooney claims its M20 is "the highest performing four-place,
single-engine, piston-powered aircraft." The current management has
addressed the product in ways the customers recognize and
appreciate, bringing in a top automotive interior vendor to class
up the ship's tight cabin, and adding the Garmin G1000 glass-panel
display as an option.
The most recent sales figures that Mooney released on February 9
are for December, and show 18 deliveries in the month, stronger
than managers expected. Mooney claims that the order book is
stronger for 2005.