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Energy company needs an alternative money source

As the economy continues to struggle, so do individuals in D.C and across the entire nation. However, it is not just your neighbor or your coworker--it is happening to large companies, too. In recent news, Evergreen Energy Inc., a developer of alternative fuel products, filed for bankruptcy. According to sources, it was difficult for the company to maintain operations because there was not enough financing. The company listed assets at about $240 million and debt at $25 million. The business filed Chapter 7 documents in the United States Bankruptcy Court in Wilmington, Delaware.

Chapter 7 proceedings let companies liquidate their assets while being protected from creditors. This type of bankruptcy is commonly referred to as Liquidation Bankruptcy or Straight Bankruptcy. It eliminates most unsecured debts, which include credit card debt, medical bills and personal loans.

Evergreen's is not the first renewable energy company that has faced financial turmoil. For example, Beacon Power Corp. filed for bankruptcy last year after receiving government loan assurance. Beacon Power Corp., which is based in Tyngsboro, Massachusetts, sought Chapter 11 protection in Delaware in late October. The company listed assets of $72 million and debt totaling $47 million.

Most people believe that when they file for Chapter 7 bankruptcy, all of their possessions will be liquidated. While debt can be a taxing and exhausting thing to deal with, you have options. If you are in financial trouble and need assistance reducing your debt, you may want to speak to an attorney about your legal and financial obligations. Chapter 7 is just one liquidation method, and a lawyer can educate you about other debt-reducing alternatives.

Source: Bloomberg Buisnessweek, "Evergreen Energy files for bankruptcy, cites lack of financing," Dawn McCarty, Jan. 24, 2012

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