Peace Equipment LLC, a trucking company based in Edcouch, Texas, has filed for Chapter 11 bankruptcy protection, citing increased operating costs and reduced income in the trucking industry. The company also identified merchant cash advances as a contributing factor to its financial difficulties.
The Chapter 11 petition was filed in the U.S. Bankruptcy Court for the Southern District of Texas on Wednesday, with Peace Equipment seeking to reorganize its operations. Established in 2016, the company has 38 drivers and 27 power units, specializing in hauling general freight, fresh produce, and refrigerated food throughout the United States.
According to the bankruptcy filing, Peace Equipment lists its assets and liabilities in the range of $1 million to $10 million. The company has up to 49 creditors and plans to distribute funds to unsecured creditors once administrative fees are paid.
Chief U.S. Bankruptcy Judge Eduardo V. Rodriguez granted Peace Equipment an interim order, allowing the temporary use of cash collateral to continue its operations. The petition includes a list of 41 creditors, including Commercial Credit Group Inc. and Crestmark Bank, which hold liens or security interests in Peace Equipment.
Peace Equipment’s attorney, Reese W. Baker, did not respond to requests for comment. The company’s trucks have undergone 37 inspections in the past 24 months, resulting in an out-of-service rate of nearly 11%, lower than the national average in the trucking industry. The drivers have been inspected 99 times, with a 4% out-of-service rate, below the national average.
The court has scheduled a final hearing on June 5 to address the trucking company’s use of cash collateral. In the meantime, the court approved Peace Equipment’s interim budget, which includes expenses such as payroll, fuel, and operating costs.
