Wisconsin residents may have heard that Evergreen International Airlines Inc. and several of its affiliates have decided to file for bankruptcy protection after it appeared as if creditors were pushing hard for the companies to make payments towards their debt. Evergreen Air filed for Chapter 7 protection on Dec. 31, 2013, only two weeks after creditors requested that the courts step in and force the company to pay off the debts it had accrued.
The creditors filed a petition back on Dec. 17 in a New York-based U.S. Bankruptcy Court. The petition only asked for Evergreen Air, an Oregon-based company, to pay off all of its debt; but after the company filed for bankruptcy, its affiliates Evergreen Defense and Services Inc. and Supertanker Services Inc. both similarly filed for Chapter 7 protection.
Evergreen Air's response to this demand, which came in their own petition filed in a Delaware U.S. Bankruptcy Court, stated that it may have up to $100 million in remaining assets. This may seem like a large amount of money, but it is dwarfed by the possible $500 million that they owe to creditors. These assets and debts come from a company that's provided several services, including air freight and maintenance, to government agencies, aviation companies and air carriers all across the globe.
Accruing a large amount of debt relative to assets isn't something that only occurs on an individual-level basis. Successful companies can also face difficulties. This means that even when a person feels drowned in debt, they can use Chapter 7 protection as a life raft. A bankruptcy attorney may help with filing for bankruptcy and prevent eviction notices and even calls from creditors.
Source: Bloomberg, "Evergreen Air Files Bankruptcy After Push For Payment", Phil Milford, January 01, 2014