An attorney representing an Indiana trucking company and two of its affiliates are seeking a bankruptcy court’s approval to enter into a post-petition financing agreement with WEX Bank, a company that specializes in fuel card and factoring services.
Prior to filing for Chapter 11 bankruptcy protection on May 31 in the U.S. Bankruptcy Court for the Northern District of Indiana, APL Cargo and affiliates Indy National Leasing and Ecosmart Trucks entered into an over-the-road account agreement, known as the executory contract, with WEX [NYSE: WEX] in March 2021.
Portland, Maine-based WEX continues to provide APL and the leasing companies with a “variety of payment-related products and services” for fuel payments and provides other business services to pay certain fleet operators, according to court filings.
APL Cargo, operating as the debtor-in-possession, seeks court approval authorizing the entities to enter into a financing agreement allowing WEX to continue its current factoring agreement, as the Indiana companies owe WEX more than $2.3 million in secured collateral. That includes the entities’ assets, accounts and equipment.
“The post-petition agreement is critical to [APL Cargo’s] ability to maintain operations,” according to the motion filed by the companies’ attorney, Weston Overturf.
Judge Robert E. Grant has set a creditors’ meeting for June 28 and has set Sept. 26 as the deadline for filing proof of claims in the bankruptcy case.
Stefan Trifan is president of APL Cargo and the sole member of Indy National Leasing in Wolcott, Indiana. Grigore Canali is president of Ecosmart Trucks.
Overturf has asked for joint administration of the Chapter 11 cases. However, Grant hadn’t ruled on the motion as of publication.
APL Cargo, entities face 2 federal lawsuits
The bankruptcy filing stays two federal lawsuits filed in Texas and Indiana.
A former diesel mechanic, Christian Velazquez, filed a personal injury suit against APL Cargo in February in the U.S. District Court for the Eastern District of Texas.
According to the complaint filed in February, Velazquez, who lives in Titus County, Texas, worked for JS Truck Repair and was called to perform a roadside repair for a APL Cargo driver Nadir Anwar Mujahid, who was having brake issues.
Velazquez claims Mujahid was instructed to keep the trailer brake applied when releasing the tractor brake. However, Velazquez alleged that while he was under the tractor, Mujahid released the trailer brake, causing his tractor-trailer to move and seriously injuring the mechanic who was pinned under the tractor.
Two former APL Cargo lease purchase drivers filed suit against APL Cargo and Indy National Leasing in April 2023. The complaint, which seeks class action status, alleges that former APL drivers were misclassified as independent contractors instead of employees in violation of the federal Fair Labor Standards Act (FLSA) and Indiana wage laws. The lawsuit also alleges that APL drivers who leased trucks or trailers from Indy National weren’t allowed to use their equipment to work for other carriers without written permission from APL.
APL Cargo lists both its assets and liabilities as between $1 million and $10 million. The petition lists the number of creditors as between 200 and 999 and states that funds will be available for distribution to unsecured creditors.