City manager calls Commander plea for public support 'sad, last-ditch' effort

A major stockholder of Commander Premier Aircraft Corp. is accusing Cape Girardeau officials of bowing to public pressure in their rejection of a company offer last week that would buy as much as another 150 days to find a new investor to take over and ramp up production.

An "open letter to the citizens of Cape Girardeau" was sent to the Southeast Missourian Sunday night and is signed by Joel Hartstone of StoneGate Capital Group. StoneGate and its principals are major stockholders and creditors of Commander Premier, which has filed for Chapter 11 bankruptcy protection.

"We want you to know that we believe the city rejected CPAC's proposal because of political pressure from you, the voters of Cape Girardeau," wrote Hartstone, the former company president who was tapped in 2008 to find financing. "We think your city officials believe that CPAC's proposal is truly in the best interest of the city. ... And for too long they have heard you loudly insist that they 'take some action to get this over with, no matter how it comes out.'"

City manager Scott Meyer said Monday that he believes the city is acting in the best interest of the city by attempting to move forward with eviction proceedings. Through a lawyer the city hired in Tyler, Texas, the city is asking a bankruptcy judge to allow the eviction of Commander from city-owned property at the airport. The hearing is set for 9:30 a.m. Tuesday before Judge Bill Parker, who will consider the city's request.

While the open letter from Hartstone asks city residents to urge their elected officials to accept the proposal, Meyer said he didn't like that the letter essentially blames the people of Cape Girardeau.

"I think it's really sad to blame the good citizens of Cape Girardeau for the dilemma they are in," Meyer said. "It is a sad, last-ditch effort. It's just sad where they've come to at the end of this and would blame our citizens for this situation, when the citizens have been the ones who have stepped up and made these rent payments."

Meyer confirmed what the letter also says: that the city did reject another Commander offer last week. The deal asked for an additional 60 days for the company to negotiate a sale. The agreement would provide for rent for that time. If there is no sale, the city would be allowed to file its eviction action. If the company did find an buyer, the deal calls for an additional 90 days, with rent up front, to conclude the deal and prepare a Chapter 11 reorganization plan.

But the city rejected that proposal.

"This is a legal matter, so we're not going to talk about specifics," Meyer said. "But we certainly worked and listened to many proposals and counterproposals. We believe we have made the best decision for the citizens of Cape Girardeau."

Counteroffer made

The letter says the city did make a counterproposal last week, asking the company to cease its fight against eviction. The city offered to not enforce the eviction for 60 days, giving Commander that amount of time to voluntarily vacate the building.

Meyer acknowledged that there was a counterproposal.

"It was reasonable in the constraints of how much time it would take," Meyer said. "But they continued to push for more and more and it became apparent that we had reached the end of what we could do."

Commander was notified in writing Feb. 15 that it had defaulted on rental payments that had been accruing since the last payment was made in December 2007. The city has said Commander owes the city about $1.2 million.

In February, the city gave Commander 60 days to make back payments for the 52,000-square-foot hangar the company has occupied since October 2005. When that didn't happen, the city terminated the lease May 16 and demanded that the property at Cape Girardeau Regional Airport be vacated no less than 30 days later.

On the 31st day, Commander commenced bankruptcy proceedings.

In the letter, Hartstone blamed the company's failure on the economic downturn. He also pointed to an infamous event that occurred when automotive executives flew to Washington for congressional hearings in three corporate jets.

"The televised chastising of those executives for flying to Washington in those planes was replayed constantly for 48 hours by every television station in America," he wrote. "It dramatically and instantly painted the use of all private planes as symbols of waste, arrogance, greed and impropriety. Suddenly, it was shameful to own, let alone buy, a private airplane. That one event immediately shut down the general aviation industry until this year."

But this year, Hartstone wrote, there has been a mild resurgence in general aviation aircraft orders, generating optimism for companies like Commander.

Without a deal like the one proposed, Hartstone said, those who have expressed interest in buying the company have said they would not remain in Cape Girardeau.

Hartstone concludes the letter with an appeal to residents.

"Unless you quickly send a dramatically different message to your elected officials, there will be a hearing on Tuesday with no agreement," he wrote. "If there is no agreement, all parties we have spoken with will conclude the city has soured on aviation and that they should not go where they are not wanted. ... Accordingly, if there is no agreement, there will be no point to further efforts to find a new owner to ramp up CPAC in Cape Girardeau."

Mayor Harry Rediger's response was similar to Meyer's. Rediger also said he was aware of the most recent proposal from Commander.

"I'm not in favor of changing our stance," Rediger said. "We've changed our stance so many times now and for so long. I think it's time to get out."

smoyers@semissourian.com

388-3642

Pertinent address:

Cape Girardeau Regional Airport

Tyler, Texas