|Fate||Chapter 7 bankruptcy|
|Headquarters||Albuquerque, New Mexico, US|
|Key people||Vern Raburn, CEO
Roel Pieper, CEO
|Products||Eclipse 500 - production halted November 2008
Eclipse 400 - development ceased October 2008
|Employees||850 (February 2009)|
Production of the Eclipse 500 was halted in mid-2008 due to lack of funding. The company entered an unsuccessful Chapter 11 bankruptcy in November 2008, which was converted into a Chapter 7 bankruptcy liquidation procedure in February 2009. In the final Chapter 7 procedure, completed on August 20, 2009, there was only one bidder, a new company formed to acquire the assets, Eclipse Aerospace.
Startup and growth
Eclipse Aviation was founded by Vern Raburn in 1998 in Scottsdale, Arizona, and the company started to design the twin-engined Eclipse 500 very light jet. Due to investments by the State of New Mexico and incentives and concessions from the City of Albuquerque, the company decided to set up its production facilities there and moved its headquarters in 2000. Construction of the first prototype started in 2001 and it first flew on August 26, 2002. Originally powered by two Williams International EJ22 turbofans these were found to be unsuitable and the aircraft was redesigned to accommodate a pair of Pratt & Whitney Canada PW610F-A turbofans. The engine change caused a delay in the programme and the PW610F-equipped prototype first flew in 2004. The aircraft was FAA certified on July 27, 2006 and the first customer aircraft was delivered in January 2007. European Aviation Safety Agency certification for private use was achieved on November 21, 2008.
In February 2006 the company was named the winner of the Collier Trophy for 2005 by the National Aeronautic Association for its work with the Eclipse 500. The award was controversial because only the prototype aircraft was flying.
On July 23, 2007, at AirVenture in Oshkosh, Wisconsin, Eclipse unveiled the already flying prototype of a second company design initially called the Eclipse Concept Jet. The four-seat aircraft was powered by a single Pratt & Whitney Canada PW610F turbofan and was built in secrecy at NASA's Wallops Flight Facility in Virginia by Swift Engineering and BaySys Technologies. The ECJ had first flown on July 2, 2007 and the company said then did not intend to place the aircraft into production but by May 2008 it began to take orders for a production version designated the Eclipse 400.
In October 2007 the company laid off between 100 and 150 contract workers and employees, about 10% of its workforce. In November 2007 subcontractor Hampson Aerospace, which built the tail assembly for the Eclipse 500, filed a suit against Eclipse alleging that Eclipse had not paid them for work completed.
During 2007 Eclipse had produced 104 aircraft and claimed a record for building its "first 100 airplanes faster than any GA jet aircraft manufacturer in history." 
Financial challenges and decline
Founding president and CEO Vern Raburn resigned as a condition of a financing package by European Technology and Investment Research Center (ETIRC) Aviation, which had invested more than US$100 million in Eclipse in 2008. Raburn announced his resignation at AirVenture on Monday July 28, 2008. The new CEO, Roel Pieper, the chairman of the board of directors and president of ETIRC, said that the company should be profitable by the first quarter of 2009.
Despite orders for the aircraft, the company announced in August 2008 that development of the Eclipse 400 was on hold and it had not started the certification process. The company declared it had not spent any of the deposit money for the Eclipse 400 but the deposits were later a subject of legal action.
On Wednesday, August 20, 2008, Hampson Aerospace closed their Grand Prairie production plant, leaving Eclipse without a supplier of tail sections.
On August 22, 2008, Eclipse announced that it would be laying off 650 of its workforce of 1800 people (38% of its work force) and a week later Pratt & Whitney Canada repossessed 24 engines sold to Eclipse.
From August 2008 onwards a number of customers filed lawsuits against the company for failure to return deposits for cancelled and delayed orders. The company indicated that due to lack of funding it was not in a position to return deposits.
Eclipse Aviation announced on September 23, 2008, that it would establish a factory in Ulyanovsk, Russia to assemble the Eclipse 500, but then halted production of the 500 in October 2008, with the company indicating that it lacked funds to continue production or refund customer deposits.
Bankruptcy and liquidation
On November 21, 2008, the company announced that it had achieved EASA certification for the 500 and then just four days later, on November 25, 2008, filed for Chapter 11 bankruptcy protection. The company was "seeking court approval for debtor-in-possession financing and procedures for the sale of substantially all of its assets under Section 363 of the U.S. Bankruptcy Code." The company also stated that it had found a buyer for the company's assets, EclipseJet Aviation International, an affiliate of ETIRC Aviation, the company with major investments in Eclipse.
Bankruptcy documents indicated that a total of $702.6 million was owed and the court documents filed indicated that the bankruptcy occurred because the company "continued to lose larger than expected sums of money on each aircraft manufactured and has not reached cash flow positive in its operations." Total company liabilities were estimated at over $1 billion. At the time of bankruptcy filing on November 25, 2008 Eclipse had delivered 259 EA500s.
On January 20, 2009, Federal Bankruptcy Court Judge Mary Walrath verbally approved the sale of the assets of Eclipse Aviation to EclipseJet Aviation International headed by Eclipse Aviation's chairman, Roel Pieper, under Section 363 of the United States Bankruptcy Code. EclipseJet Aviation International was unable to secure the funding they had anticipated and on February 24, 2009 a group of companies to whom Eclipse owed money applied to the court to force the unfinished Chapter 11 proceedings into Chapter 7, a move supported by the company management.
After a lengthy Chapter 7 process running from March to August 2009, there was only one bidder for the assets of the company. Eclipse Aerospace, headed by Mike Press and Mason Holland, offered US$20M in cash and US$20M in new promissory notes, stating that they would locate the new company in the existing Eclipse facilities in Albuquerque. Eclipse Aerospace plans to provide upgrades to the current Eclipse fleet and will assess whether production can be restarted at some future point. Eclipse Aerospace was confirmed as the new owner of the assets of the former Eclipse Aviation on August 20, 2009 and opened for business on September 1, 2009.
Eclipse also developed PhostrEx, a fire suppression agent for use in aviation applications to replace halon, a greenhouse gas (GHG). It was developed by Eclipse Aviation for use aboard their Eclipse 500 jets, and is now being marketed to other aviation manufacturers.
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