Xtreme Power has announced that it filed voluntary petitions for relief under Chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for the Western District of Texas.
The Chapter 11 filing will enable the company to continue its operations at all locations as it begins a process to identify an acquirer. The company's core engineering, project development and operations staff will remain in place during this process. Alan Gotcher, Xtreme Power CEO, said that the company's general creditors will provide the necessary financing, including DIP financing, to enable the search for an appropriate acquirer to proceed. He also said that the Chapter 11 filing was structured to allow one of the company's creditors to file a stalking horse bid for the company in the event that alternative bids during the Chapter 11 process prove to be insufficient. The company is seeking a superior stalking horse bid by February 28th, with a subsequent bankruptcy auction. The company has a strong pipeline with in excess of US$ 100 million and letters of intent for US$ 65 million. They also expect EBITA to be at break-even by later this year with significant upside potential to both EBITA and revenue.
