FORT LAUDERDALE, Fla., July 13, 2010 (GLOBE NEWSWIRE) -- Gulfstream International Group, Inc. (the "Company") (NYSE Amex:GIA) today announced that the Company has reached a final agreement with the Federal Aviation Administration providing for the settlement of certain proposed civil penalties. The agreement calls for the Company to pay $550,000 over a five-year period.
The Company has also reached an agreement with Raytheon Aircraft Credit Corporation ("RACC") to extend its current Lease Amendment and Forbearance Agreement relating to 21 Beech 1900D airliners leased from RACC until December 6, 2010 (the "Lease Termination Date") on their existing terms and provide for, among other things, the opportunity to purchase the fleet of aircraft from RACC, enabling the company to reduce existing annual lease payments by approximately $5 million.
The Lease amendment and Forbearance Agreement, reached with RACC on May 14, 2010, also includes certain concessions with respect to past payment obligations due in December, 2010, as well as other indebtedness, which is contingent upon closing the aircraft fleet purchase by the Lease Termination Date, and would reduce the Company's overall obligations to RACC.
The net effect of the FAA and RACC agreements, subject to completing the aircraft fleet purchase, would result in a reduction of current liabilities in excess of $1.0 million.
David Hackett, CEO of Gulfstream, commented, "The ability to purchase our fleet of aircraft leased from RACC represents a major milestone in our goals of significantly lowering our operating costs and strengthening our balance sheet, strongly positioning us for a return to profitability. We also believe that settling the FAA's proposed civil penalty is in the best interest of our company and its stakeholders, and while we have differing views as to the merits of some of the claims, the Company will be able to ensure its focus remains on continuous improvement in operations and financial results."
About Gulfstream International Group, Inc.
Gulfstream is a regional air carrier based in Fort Lauderdale, Florida, operating for 20 years. The Company specializes in providing travelers with access to niche locations not typically covered by major carriers. Gulfstream International Airlines, Inc. operates more than 150 scheduled flights per day, serving nine destinations in Florida, ten destinations in the Bahamas, five destinations from Continental Airline's Cleveland hub under the Department of Transportation's Essential Air Service Program and charter service to Cuba. For more information on the company, visit the company's website at http://www.gulfstreamair.com.
The Gulfstream International Airlines, Inc. logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=7702
Special Note Regarding Forward-Looking Statements
In addition to historical information, this release contains forward-looking statements. Gulfstream may, from time-to-time, make written or oral forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements relate to, among other things: its business strategy; its value proposition; the market opportunity for its services, including expected demand for its services; information regarding the replacement, deployment, acquisition and financing of certain numbers and types of aircraft, and projected expenses associated therewith; costs of compliance with FAA regulations, Department of Homeland Security regulations and other rules and acts of Congress; the ability to pass taxes, fuel costs, inflation, and various expenses to its customers; certain projected financial obligations; estimates regarding capital requirements; and any other plans, objectives, expectations and intentions contained in this release that are not historical facts.
These statements, in addition to statements made in conjunction with the words "expect," "anticipate," "intend," "plan," "believe," "seek," "estimate" and similar expressions, are forward-looking statements. These statements relate to future events or future financial performance and only reflect management's expectations and estimates. All forward-looking statements included in this release are made as of the date hereof and are based on information available to Gulfstream as of such date. The following is a list of factors, among others, that could cause actual results to differ materially from the forward-looking statements: changes to external competitive, business, budgeting, fuel cost or supply, weather or economic conditions; changes in its relationships with employees or code share partners; availability and cost of funds for financing new aircraft and the ability to profitably manage its existing fleet; adverse reaction and publicity that might result from any accidents; the impact of current or future laws and government investigations and regulations affecting the airline industry and its operations; additional terrorist attacks; and consumer unwillingness to incur greater costs for flights.
Gulfstream assumes no obligation to update any forward-looking statement. Risk factors, cautionary statements and other conditions which could cause actual results to differ from management's current expectations are contained in Gulfstream's filings with the Securities and Exchange Commission, including Part I, Item 1A, "Risk Factors," of its Annual Report on Form 10-K for the Year Ended December 31, 2008 and subsequent Form 10-Q filings.