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Big, bad debts: 20 bankrupt Arkansas businesses had debts of more than $1 million each.

Jones Truck Lines Inc. of Springdale filed the largest business bankruptcy of 1991, listing debts of $103 million on a Chapter 11 reorganization petition.

The trucking firm once was the 10th-largest privately held company in the state with 1990 revenues of $240 million. Now, it is selling off assets to satisfy creditors.

Fairfield Communities Inc. of Little Rock recorded the state's largest business bankruptcy when it filed in October 1990. Fairfield had debts of more than $325 million at the time.

This week's chart lists the largest business bankruptcies filed during the last six months of 1991 and the first several weeks of 1992.

Twenty of the almost 80 bankrupt firms that filed during the period listed debts of more than $1 million. The bankruptcy petitions were almost equally divided between Chapter 7 liquidations and Chapter 11 reorganizations.

7-11

Chapter 7 provides for a court-appointed interim trustee with broad powers that include the ability to make management changes, arrange unsecured financing and operate the business in a way that will prevent additional losses.

Chapter 11 provides that, unless the court rules otherwise, the debtor will remain in possession of the business and in control of its operation. It makes possible the negotiation of payment schedules, the restructuring of debt and even the granting of loans to the debtor.

As usual, the restaurant business had more bankruptcies than any other business sector. Nine restaurants filed during the period surveyed.

Jones Truck Lines was one of four transportation firms to file for bankruptcy. The others were Darrell Owens Trucking Co. of Brockwell in Izard County, Multi-States Brokerage Inc. of Sherwood and Lonoke Truck and Trailer Inc.

The number of bankruptcy filings, business and personal, continues to soar as the recession lingers. Filings increased by 18 percent statewide in 1991, the largest increase since 1986.
10 Years of Arkansas Bankruptcy Filings
 Increase From
Year Total Previous Year
1982 2,889 6%
1983 2,801 -3%
1984 3,599 28%
1985 4,104 14%
1986 4,970 21%
1987 5,672 14%
1988 6,052 7%
1989 6,365 5%
1990 7,050 11%
1991 8,317 18%
Source: U.S. Bankruptcy Court.
Filings include Chapters 7, 11, 12 and 13. Both business and
personal filings are reflected in the totals. The totals also
include reopened cases.
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No portion of this article can be reproduced without the express written permission from the copyright holder.
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Article Details
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Author:Gibson, Carolyn
Publication:Arkansas Business
Date:Feb 10, 1992
Words:383
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