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Bob_anderson
Joined: 31 Mar 2008
Posts: 17
Location: Atlanta
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 Posted: Mon Mar 31, 2008 11:16 am Post subject: CZAW is bankrupt |
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Hi Jim,
I know that you like Chip Erwin, CZAW but people need to know the facts. You may remember that Chip Erwin started a company in the Czech Republic years ago called "Nextair". Chip got funding from banks, who lost everything as the company went bankrupt. When Nextair did go bankrupt, he left the company and purchased the assets at less than 10 cents on the dollar. It seems that now he is doing it again. Slavia Capital is the main shareholder of CZAW.
But don't take it from me. Here is the contact info for Slavia Capital.
Frank Nosek
Investment Banking / Director
SLAVIA CAPITAL Praha
Rytirska 13
110 00 Praha 1
Tel.: +420 221 181 062
Fax: +420 221 181 068
Mob.: +420 605 228 570
fnosek(at)slaviacapital.com
www.slaviacapital.com
I think that CZAW customers that have put a deposit need to have the option of getting it back.
Bob.
Hello.
I’ve included below the full text of the release written today by Sport Aircraft Works, regarding the March 27 (bankrupt) filing by part-owner Slavia Capital. As is always the case, there is a story behind the story, and SAW is explaining its view of the circumstances.
It is good for us to note that shipments have escalated and continue, setting records for both February and March 2008, and that US deposits are held in the US; customer exposure seems to be minimized by prudent work by CZAW and the US Distributor, Sport Aircraft Works.
Danny Defelici (President, SAW) also assures me that he has made no changes in his plans to attend Sun ‘n Fun.
This kind of filing is never good news; but in this case it doesn’t look too bad, either. Do your homework (Czech laws differ from those of many other countries) before putting forward some of the wilder comments they’ve already heard.
This distribution has been delayed deliberately, to allow the company to make contact with customers, first.
Tim Kern
Tim Kern INK / 121five.com
PO Box 30
Anderson, IN 46015-0030
USA
863-651-6095
Below is the verbatim press release.
We feel that it’s important for you to know the facts about the current situation at Czech Aircraft Works.
Here is a brief history from our point of view.
• IN 2006 CZECH AIRCRAFT WORKS (CZAW) TOOK ON AN INVESTMENT PARTNER FOR 49% OF THE OUTSTANDING STOCK FOR THEIR PRODUCTION EXPANSION AND PURCHASE OF NEW FACILITY. THIS INVESTMENT CAME FROM SLAVIA CAPITAL (SC), SLOVAKIA BASED INVESTMENT FIRM.
• AFTER INITIAL HONEYMOON SC DECIDED THAT CHIP ERWIN’S (CZAW CEO) MANAGEMENT WAS NOT TO THEIR LIKING AND THEY PROMPTLY TOOK OVER CONTROL OF THE FACTORY. THE PERSONNEL THAT THEY PUT IN PLACE HAD NO AVIATION BACKGROUND AND BASICALLY STRIPPED THE COMPANY OF VALUED WORKERS BY FIRING THE BEST ONES. (I believe that the investors have a very different opinion on this)
• NOW IT’S CLEAR THAT DURING 2007 THE MANAGEMENT TOOK EVERY OPPORTUNITY TO MAKE THE WRONG DECISIONS AND RUN THE COMPANY FINANCIALLY INTO THE GROUND. TOWARDS THE END OF 2007 SC DECIDED THE COMPANY NEEDED ADDITIONAL FUNDS AND OFFERED GREATER DILUTION AT UNFAVORABLE TERMS TO THE EXISTING SHAREHOLDERS. CHIP ERWIN (PARTIAL OWNER) TOGETHER WITH THE REST OF THE SHAREHOLDERS REFUSED THIS OFFER AND CHIP TOOK CONTROL OVER THE FACTORY AGAIN. (Hard to believe that an investor would want to devalue his investment. I think that an investor would want to make the company more valuable so that the value of the investment would go up). Hard to believe that management would want to run the company into the ground as that is not a good way to protect your job and investment).
• AT THE SAME TIME SC STARTED A CAMPAIGN TO DISCOURAGE CZAW VENDORS FROM SELLING EQUIPMENT TO THEM AND SPREADING RUMORS OF IMMINENT BANKRUPTCY. ALTHOUGH THIS CAMPAIGN WAS DETRIMENTAL TO THE COMPANY, CHIP ERWIN WAS ABLE TO CONTINUE GROWING THE COMPANY OUT OF THE MESS THAT WAS CREATED. (Again, hard to believe that investors and management would want to hurt the company. Seems that Chip Erwin did not get along with anyone).
• IN THE BEGINNING OF 2008 FOR THE FIRST 3 MONTHS CHIP ERWIN PROVED THE COMPANY WAS VIABLE BY RUNNING THE COMPANY ON CASH FLOW WHILE PAYING SUBSTANTIAL LIABILITIES DOWN AT THE SAME TIME. THIS DEMONSTRATES THAT THE COMPANY IS VIABLE GOING FORWARD AND IS NOT INSOLVENT OR NEEDS BANKRUPTCY PROTECTION. (Not paying debt and vendor obligations is not a way to run a company. CZAW owes a lot of money to vendors and investors. )
• SC, THROUGH THEIR COLLABORATION WITH AN [AFFILIATED?] COLLECTION AGENCY, PETITIONED THE CZECH COURTS FOR BANKRUPTCY AND/OR RESTRUCTURING ON MARCH 27, 2008. IN OUR VIEW THIS WAS ANOTHER DIRTY TACTIC TO MAKE THE SHAREHOLDERS CAPITULATE IN GIVING UP FULL CONTROL OF A VIABLE COMPANY TO MINORITY SHAREHOLDER (SC). (Chip management style does not work well with others. I just does not make sense for a major investor to want to bankrupt a company. SC. It is Chip that wants to get rid of SC so that he can have it all to himself. He did this very well with Nextair years ago. Chip is hoping to purchase the assets of CZAW for almost nothing after it goes bankrupt. He will than have everything to himself which will include the aircraft designs, inventory and factory. Not a bad deal!!)
How does this affect us?
• IT’S CHIP’S UNDERSTANDING THAT IT TAKES 14 DAYS FOR THE BANK TO COMMENT ON THE RESTRUCTURING PETITION, AT WHICH TIME THE COURTS WILL DECIDE WHICH WAY TO GO. IT’S PROVEN FROM OUR FIRST THREE MONTHS OF 2008 THAT WE ARE VIABLE AND WE WILL PETITION THE COURT (IF IT GOES THIS FAR) TO CONTINUE OPERATING AS USUAL UNDER THE COURTS’ PROTECTION. THIS ACTUALLY WOULD BE GOOD FOR CZAW AS IT PROTECTS THEM FROM THEIR OWN INVESTMENT PARTNER. (I would say that Chip knows better than anyone on how the bankrupt laws work in the Czech Rep.)
• DELIVERIES SHOULD CONTINUE AS PLANNED. EVEN UNDER RESTRUCTURING THE COMPANY CONTINUES TO RUN AND MANUFACTURE. WE HAVE HAD TWO STRONG MONTHS (FEBRUARY AND MARCH 0 OF AIRCRAFT DELIVERIES WITH A TOTAL OF 16 AIRPLANES DELIVERED (CZAW SHIPPED 20 TOTAL IN MARCH). (Hard to believe that 20 aircraft were shipped in March. Total deliveries are 57 to date. See HTTP://WWW.SPORTAIRCRAFTWORKS.COM/PDF/LSA_MANUF_REPORTS/LSA_DATA_03012008.PDF ).
And just to reassure all our customers, we keep all of the deposits on this side of Atlantic. (how do we know that this is true???
To sum this up Chip Erwin has been using all of his resources (what resources? He has no money!) and energy to resolve the problems with Slavia Capital and continue to deliver one of the best LSA aircraft on the market.
Thank you for your continuing support.
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Bob_anderson
Joined: 31 Mar 2008
Posts: 17
Location: Atlanta
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| Posted: Tue Jun 17, 2008 7:23 am Post subject: Re: CZAW is bankrupt |
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Hi Bob, Thanks for your message.Chip Erwin nearly convinced me to buy 9 % of CZAWfor $800 000.He convinced (by deceiving an old friend )Slavia Capital to put in $2.4 million.The idea is that it would be 9% for me 40% for SC he would retain control and get $3.4 million but had to be content with$2.4million.My accountant smelt a rat right away. People are wondering where the money has gone ! I knew he was a very tricky dicky but never thought he would steal my OC3989from under my own eyes. The Police in Czeck Rep. unfortunately could not prevent the theft.Until it happens there is no crime.Sounds crazy but it is like that. The worst thing is that the plane was for a client/friend who had been waiting 2 years .He is very upset and I am even more because the plane was fully paid(he hates to deliver this type of plane--does not help his cashflow !!). He forced me to sign a new agreement which I did to salvage something as I know CZAW will be history soon.The Police advised me to do it. I am sending this info to a few friends and colleagues and you may do the same.Of course he will put it around I am also part of a big conspiracy. Regards Leonardo SayagoAeromarine Lda Eng. Leonardo SayagoAeromarine, Lda.Monte do LagoMontargil - PortugalMobile: 00351917505520www.aeromarine.eu
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stock-man
Joined: 14 Aug 2010
Posts: 1
Location: USA
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| Posted: Sat Aug 21, 2010 5:33 am Post subject: Re: CZAW is bankrupt |
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Thanks for the information
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voltline
Joined: 25 Sep 2010
Posts: 1
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| Posted: Sun Sep 26, 2010 5:37 am Post subject: Re: CZAW is bankrupt |
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Thanks for your post it is very informative. Is Chip Erwin is still contactable? Can he explains to the public why the company got bankrupt?
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