SOURCE: Global Aircraft Solutions, Inc.

December 20, 2007 14:37 ET

Global Aircraft Solutions Closes $10,000,000 Debt Financing

Capital Infusion to Have an Immediate Positive Impact on Liquidity

TUCSON, AZ--(Marketwire - December 20, 2007) - Global Aircraft Solutions, Inc. (OTCBB: GACF) today announced that it has issued a non-convertible debenture in the amount of $10,000,000 to two institutional investors. The debenture matures in one-year from closing and accrues interest at a rate of 15% per annum. The debenture is secured by a first priority lien on all current and future assets of the Company, and provides for a cash flow recapture of 60% of any sale proceeds related to the Company's aircraft inventory. As an inducement to purchase the debentures, the Company issues a Warrant entitling them to 1,500,000 shares of common stock. The Warrant shall have an exercise price equal to 105% of the VWAP, a five-year term, and a cashless exercise feature.

The Company will utilize the financing proceeds to repay all existing indebtedness, pay down certain accounts payable, and fund operating capital.

The Company also announced that it will hold a shareholders conference call on January 3, 2008 at 4:15PM. The exact call-in numbers of the conference call will be provided in a subsequent press release. At that time management will provide a more detailed financial and operational update, and answer investors' questions.

Ian Herman, Chairman and CEO of Global Aircraft Solutions, commented, "This $10,000,000 financing will provide the liquidity needed to move the Company forward in a positive manner as we enter 2008. This is essentially a bridge financing that will allow the Company to pursue the collection of receivables and the sale of assets from a financial position much more conducive to maximizing the value of those receivables and assets. We fully anticipate that this new financing will result in improved financial results from our operating units. Once we have converted some of our larger receivables and assets to cash, and have improved operating results, we then intend to replace as quickly as possible the current short-term debt financing with a more traditional long-term credit facility. We believe that this capital injection provides us with the ability to acquire profitable business that we have been forced to forgo, and sets the stage for us to enter 2008 with the financial stability required of a capital intensive business."

About Global Aircraft Solutions

Global Aircraft Solutions provides parts support and maintenance, repair and overhaul (MRO) services for large passenger jet aircraft to scheduled and charter airlines and aviation leasing companies. Hamilton Aerospace and World Jet, both divisions of Global Aircraft Solutions, operate from facilities comprising about 25 acres located at Tucson International Airport. These facilities include hangars, workshops, warehouses, offices and other buildings. Notable customers include Avolar Airlines, Jetran International, Goodrich Corporation, AAR, the Mexican Presidential Fleet, Azteca Airlines, Pegasus Aviation, Aloha Airlines, Alant Soyuz, United Breweries Holdings and Global Aircraft Leasing Partners.

Global's website is located at www.globalaircraftsolutions.com. The Hamilton Aerospace website is located at www.hamaerotech.com.

Safe Harbor

Except for the historical information presented, this press release contains "forward-looking statements" made in reliance upon the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 or regulations thereunder including, but not limited to expected and estimated revenue and earnings. Forward-looking statements are made based upon management's expectations and belief concerning future developments and their potential effect upon the Company. There can be no assurance that future developments will be in accordance with management's expectations or that the effect of future developments on the Company will be those anticipated by management.

The words "believes," "expects," "intends," "plans," "anticipates," "hopes," "likely," "will," and similar expressions identify such forward-looking statements. Such forward-looking statements involve known and unknown risks, uncertainties and other important factors that could cause the actual results, performance or achievements of the Company or its subsidiaries or industry results, to differ materially from future results, performance or achievements expressed or implied by such forward-looking statements. These risks include the economic health of the airline industry, demand for Global Aircraft Solutions' services, and competitive pricing pressures.

In addition, other risks are detailed in Global's Form 10-K for the year ended December 31, 2006, Global's Form 10-Q for the quarter ended March 31, 2007, and Global's 10-Q for the quarter ended June 30, 2007. These statements speak only as of above date, and Global disclaims any intent or obligation to update them.

Contact Information

  • Contact:
    Global Aircraft Solutions
    Ian Herman
    (520) 275-6059
    Email Contact

    Or

    Alliance Advisors, LLC
    Alan Sheinwald
    914-669-0222
    Email Contact