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Trucking company files for Chapter 7 bankruptcy

Having liquidity is usually important in order for a company to maintain business operations. Without cash, many businesses in Texas and in other states may not be able to pay for the labor and supplies necessary to continue operating. This is what happened to one trucking company, which resulted in the business being forced to file for a Chapter 7 bankruptcy.

The trucking company’s lender had suddenly decided to stop funding the company’s everyday business operations. The company, New Century Transportation, immediately began seeking lending from other potential lenders; however, they were unable to secure enough financing to continue operating. New Century Transportation had even considered selling all or a portion of the business as an alternative to filing liquidation bankruptcy.

The company’s letter sent to its employees in early June explained that the company was unable to inform employees of the company’s financial problems, because it would have affected the company’s ability to obtain funding from lenders or secure a sale of the business. The company was started in 2000 and also operates affiliate companies, Western Freightways and North Wind Logistics. Western Freightways is a carrier company that New Century Transportation had acquired in 2006.

After finalizing the Chapter 7 bankruptcy proceedings, the owners of the company will be able to start over with a clean financial slate. This option is available for just about any business owner in Texas or any other state. However, it is important that one properly fills out the correct legal documentation when filing for bankruptcy.

Source: truckinginfo.com, "New Century Transportation Files for Bankruptcy", Evan Lockridge, June 10, 2014

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