chapter 11: November 2008 Archives

Eclipse Aviation, a pioneer in the ultra-light jet segment, filed for Chapter 11 protection today after failing to raise capital in the current economy. The company was using bridge loans and reduced output to preserve its business, and had not achieved profitability. It also had lawsuits pending from customers angry at Eclipse for raising the price of its jet prior to delivery.

Eclipse must be particularly disappointed with its timing, as the European Safety Agency approved the Eclipse 500 for sale in 37 European countries this past Friday. The company's CEO was hopeful that the certification would improve its ability to secure funding.

Lenox Group, the maker of tableware and gifts, filed for Chapter 11 bankruptcy today. The company is trying to sell itself and expects to continue operations during the bankruptcy process. CEO Marc Pfefferle insisted that the company is "fundamentally sound" and "conducting business as usual," but that it had been overwhelmed by debt problems and current market conditions.

Perhaps none of these will heavily affect consumers, but a lot of filings came over the wires yesterday:

• DayJet, a regional airline that closed up shop, filed for Chapter 7 liquidation
• CPG Marketing, which processed rebates for third-party companies, filed Chapter 11 with heavy outstanding liabilities
• Beaudry RV, a regional dealership, caught without money to repay debts
• Getrag, transmission manufacturer (but it seems only for one plant)

Despite a private equity buyout earlier in the year, Steve & Barry's stores will be selling all merchandising and closing the entire business in the coming months. The chain previously announced more than 100 store closings but was planning to run 173 existing stores. A lack of financing for continuing operations, caused by soft sales, resulted in the about-face. Affiliates of the new owners filed for Chapter 11 bankruptcy protection Wednesday.

Family-owned discount retailer National Wholesale Liquidators filed for Chapter 11 bankruptcy today. The regional chain gave no official reason for the filing and the company's web site lists no information.

Ending a common topic in this space, Circuit City filed for Chapter 11 bankruptcy protection Sunday. The company notes in a subhead of its press release that it is "fully operational and open for business." Excluding the rash of store closings, I suppose.