Startup GLO Airlines is all aglow after an emergency bankruptcy hearing Tuesday that cleared the way for it to continue flying.
"We understand the past few days have been uncertain, but flights will be reinstated, fares will be honored, and I encourage everyone to please contact us with any questions," Trey Fayard, the airline's founder and chief executive officer, said in a statement Tuesday afternoon.
The New Orleans-based airline offers direct flights between Louis Armstrong New Orleans International Airport and other locations in the region, including Bill and Hillary Clinton National Airport/Adams Field. It also offers seasonal flights between Clinton National and Destin, Fla.
The airline filed for bankruptcy protection earlier this week after a contractual dispute between GLO and a company that provides pilots and other services to the airline. That company filed a notice to terminate its agreement with GLO. If the termination was enforced, the airline would have been unable to fly beyond Thursday.
The airline statement said that the brief disruption in sales and operations caused by the dispute has ended, and GLO reached an agreement in court Tuesday allowing it "to continue operating at full service to all destinations."
GLO, which began operations in 2015, blamed the bankruptcy filing on growing pains.
"Reorganization is a common occurrence in the aviation industry as most airlines have gone through the process," the airline said in the statement. "Today's results have enabled GLO to continue to serve customers and protect jobs."
GLO leases its three aircraft and contracts with a separate company, Corporate Flight Management of Smyrna, Tenn., to provide pilots, flight attendants and other services.
The airline said it increased its oversight of Corporate Flight Management and an affiliate after instances of erroneous overbilling, premature demands for payments, incorrect invoices, hiring unqualified employees and negligent management of the airline's maintenance department.
Also, the airline said it had to ground an aircraft and cancel several flights after a Corporate Flight Management pilot tried to "hot start" a GLO-leased aircraft in March 2016 and left it severely damaged.
Corporate Flight Management claimed GLO defaulted under the terms of its contracts with the company and an affiliate, Air Carrier Management Company, and terminated the contracts with notice.
The two entities, in a default notice emailed on April 15, cited GLO's failure to pay invoices dated after March 23. Two days later, Corporate Flight Management notified GLO and the U.S. Department of Transportation that it intended to terminate its contract with the airline, effective Thursday.
The company said it would withdraw the termination notice if GLO paid $276,694.04 to Corporate Flight Management, $80,000 to Air Carrier Management Company and posted a $500,000 security deposit.
The potential disruption came several days before the start of the annual New Orleans Jazz and Heritage Festival and as the airline seemed to be taking flight financially. It flew 32,000 passengers last year and was on track to carry 40,000 in 2017, GLO said.
Its passenger traffic was growing at Clinton National as well. It carried 4,243 passengers at the airport through the first three months of 2017, a 62 percent increase over the same period a year ago when it flew 2,614 passengers.
The courtroom drama didn't appear to disrupt GLO's service at Clinton National. Staacy Cannon, the airline's president, briefed Clinton National officials after Tuesday's hearing.
"GLO flew today and will be flying tomorrow with the president telling us the company will have a regular schedule," Shane Carter, the airport's spokesman, said Tuesday. "The airport has an excellent relationship with GLO and looks forward to passengers having many flights ahead."
Rick Fleetwood, chief executive officer of Snell Prosthetics and Orthotic Laboratory in Little Rock, recently attended a charity auction where he purchased two round-trip GLO tickets to New Orleans or Destin.
When he heard the airline sought bankruptcy protection, he said, "Oh, that's just great. I have two tickets and can't use them."
"I was very disappointed," he said.
But after learning GLO was still in business, Fleetwood said he was "elated" to know he will be able to use the tickets: "I am very glad. This is a needed service."
GLO began canceling flights and offering refunds on a rolling basis April 18. The airline had canceled all flights from Friday through May 4, said Jordan Mitchell, an airline spokesman.
The airline now is allowing people who got a refund an opportunity to re-book at the price of their original ticket, Mitchell said. More information about re-booking is available at info@flyglo.com or toll-free at (855) 435-9456. or by calling (855)435-9456.
Fayard expressed gratitude for passengers continuing to stand by the airline.
"The last several days have been hard on the entire GLO family, and we are happy to be able to continue to bring the best value in air service back to the communities that have embraced us," he said.
Business on 04/26/2017