Vector Launch developed rockets at a facility in Tucson, Arizona. Vector Launch, Inc., based in Tucson, has suspended its development of rockets to launch small satellites. The bankruptcy plan is to sell some assets to Lockheed Martin Corp. (an aerospace company), then auction the rest. Vector’s board agreed to a loan provided by Lockheed Martin as well as Lockheed’s purchase of the GalacticSky assets. This chapter 11 bankruptcy may save the business but if agreements cannot be made with it’s creditors, it may be the end of the line for the company.
In response to a management shift and change in financing, the Tucson-based small satellite startup company, Vector Launch Inc. will stop most operations.
Vector, a small-launch vehicle company in Tucson, Arizona, filed Chapter 11 bankruptcy in December, 2019. At one time a leading company in the small launch vehicle market, Vector paused operation for a “significant change in financing” and a lay off of almost all its employees. Vector will hope to reorganize under the Chapter 11 bankruptcy provisions.
Chapter 11 bankruptcy is a bankruptcy designed for businesses who want to re-organize their debt and continue business as they reorganize and it gives them time to pay their creditors over time. Chapter 11 bankruptcy is the 3rd most popular form of bankruptcy in Tucson based on the Pima County Bankruptcy filings for 2019.
A financial summary reportedly puts Vector’s assets between 10 and 50 million dollars and its debt between 1 and 10 million dollars. With a Chapter 11 bankruptcy, the debtor devises a plan to repay creditors, while they are protected from legal debt collection actions. Vector was founded in 2016 by Jim Cantrell, a veteran of Space X (Elon Musk), has been backed by major venture-capital firms investors. Approximately 50-70 Tucson employees are expected to enter the world of unemployment due to the Vector Launch misfortune. Cantrell was replaced as CEO of the company by John Garvey earlier in 2019.