The recent announcement that AAR was sold for $4.25 million to the Green enterprise does not tell the true story of what will be available to the creditors, unpaid employees and hosts, and the investors. Last September the Drobny group offered $2.5 million of funding to prevent the embarrassing bankruptcy filing, work out a payment schedule for the general creditors, and leave the investors with a 49% interest. The largest creditors were Rob Glaser and some other board members totaling approximately $15 million. The other creditors were manageable and some of the outrageously expensive contract commitments could have easily been renegotiated.
The offer was rejected and as a result, Rob Glaser, Terry Kelly, and Doug Kreeger started funding the post bankruptcy operations with what is called "debtor in possession" (DIP) loans. DIP loans always have priority of payment in a Chapter 11 proceeding. The DIP loan as of the most recent court filing was $3.25M and there are outstanding preferred creditor payments totaling about $500,000. Therefore, the net proceeds from the $4.25M sale available to all other creditors are $500,000. All the investors and virtually all the creditors have been abandoned despite their strong support and belief in AAR. And many of them made the investment to advance a worthy cause as their primary goal. Unlike the other investors, the Drobnys immediately started a new progressive network called Nova M Radio, www.novamradio.com, to continue advancing our dream. We hired Mike Malloy and he is now broadcasted on several affiliates, Sirius, and coming soon to XM Satellite Radio.
If you think none of this makes any sense, you are correct. But, as I mentioned in my October 14, 2006 post, http://www.huffingtonpost.com/sheldon-drobny/air-americas-future_b_31692.html ,ego and an opportunistic bankruptcy attorney got in the way. I have a lot of experience in business and commercial legal matters and the Federal Bankruptcy Courts, attorneys, and trustees are essentially a "good old boys club." The lawyers and trustees are the only ones that really make out in this forum. This is a real scandal that has yet to be exposed to the public. Unfortunately, like most everything that the MSM fails to report about, there is a hesitancy to expose this by them because the bankruptcy system essentially protects the rich entrepreneurs and screws the creditors and shareholders. Enron is but one of many such scandals that go on every day.
The good news is that we at Nova M Radio can run our own operation and do it right this time. Besides Mike Malloy, we have under contract John Zogby, John Loftus, Joe Trippe and other surprises in the near future. There is an old Yiddish word, beshert, which means that it was meant to be. I believe that the recent events concerning AAR were beshert and that it was the best thing that ever happened to the Drobnys in our efforts to make a positive impact on the way the MSM operates.