Celadon Group

Celadon Group, Inc. was a truckload shipping company located in Indianapolis, Indiana, USA. It was one of the ten largest truckload carriers in North America.[citation needed]

History

Celadon was founded in 1985 and employed over 4,000 individuals.[citation needed]

On May 1, 2017 the company announced that COO Eric Meek had resigned after auditor BKD, LLP had determined that the financial statements for the 2016 fiscal year “should not be relied upon.” On May 8, the New York Stock Exchange informed the company that it had failed to meet the exchange's listing standard and the company's stock could be delisted in six months. The noncompliant financials put Celadon into default with its lenders. The company reached a new credit deal with Bank of America on July 3 after agreeing to a host of operating and reporting restrictions. CEO Paul Will announced his retirement on July 13.

In April, 2018, the New York Stock Exchange suspended trading the stock of Celadon and moved to remove the company's stock listing after an internal investigation had identified accounting errors that required it to restate financial results dating back to 2014.[2] Subsequently, it was found that the errors were the result of a series of trades of aging and unused trucks using invoices with deliberately inflated values to intentionally hide significant losses from its investors.[citation needed]

On April 25, 2019, it was announced that Celadon Group Inc. had agreed to pay total restitution of $42.2 million as a part of its deferred prosecution agreement (DPA) for filing materially false and misleading statements to investors and falsifying books, records and accounts.[3]

On May 9, 2019, the SEC charged the former President of Quality Companies, LLC, a former subsidiary of Indianapolis-based Celadon Group Inc., with an accounting fraud that allowed Celadon to avoid disclosing substantial losses and misrepresent its financial condition.[4]

On December 5, 2019, the Securities and Exchange Commission (SEC) charged former Celadon president and chief operating officer William Eric Meek and former chief financial officer Bobby Peavler of Celadon with accounting fraud. In a parallel action, the U.S. Attorney's Office for the Southern District of Indiana and the U.S. Department of Justice, Fraud Section jointly announced that Williams had pled guilty to related criminal charges.[5]

Bankruptcy

On December 8, 2019, Celadon Group, Inc. and 25 affiliates filed bankruptcy in the United States District Court for the District of Delaware. According to the Federal Motor Carrier Safety Administration in October 2019, the company had 2,771 trucks and 2,553 drivers, and was listed as the 38th largest carrier in North America. The company received $165 million from the sale of 49.9% of the company to Luminus Management four month before filing. The trucking company was delisted from the New York Stock Exchange in 2017, for failure to disclose quarterly and annual reports as required by SEC, and along with a poor trucking market as well as the legal issues, that included a $42.2 million fine by the U.S. Department of Justice, made securing more funding impossible. The court, in a first stage bankruptcy plan, authorized the use of $5.4 million of an $8.2 million loan to pay employees. The closing also includes Hyndman Transport, that ends 82 years of operation and Jaguar Transportation,[6] but does not include the division of Taylor Express in Hope Mills, North Carolina that is planned to be sold.[7]

Celadon sent messages to the drivers (by ELD messaging) that the company was closing and that everyone that delivered loads and followed directions to return equipment would be compensated.[8]

In March 2020, Celadon auctioned off assets from the company headquarters and driver dorms as part of their bankruptcy agreement.[9]

Subsidiaries

  • Celadon Trucking Services
  • Hyndman Transport
  • Jaguar Transportation
  • Taylor Express

References

External links