(WBNG Binghamton) Endicott Interconnect owes $70 million to companies that it can't pay, forcing what was one of Broome County's largest employers to file bankruptcy protection in federal court.
That $70 million includes nearly than $27 million to its 20 largest creditors, according to the bankruptcy filing in U.S Bankruptcy Court, Northern District of New York.
The company filed for Chapter 11 protection Wednesday in U.S. Bankruptcy Court.
Its estimated liabilities are between $50 million and $100 million divided among 200 to 999 creditors, according to court documents.
The largest unsecured claim is with IBM for nearly $5.5 million, according to documents.
However, a letter sent to employees dated Wednesday states the company lost nearly $100 million between 2009 and 2012. The letter states EIT cannot meet $70 million of that debt, making Chapter 11 the only viable solution.
Among other large debts:
- Nearly $2.5 million to Acbel Polytech, Inc. in New Taipei City, Taiwan
- More than $3.6 million to Arrow Electronics of Wilmington, Maine
- More than $3.5 million to Rochester-based Avnet Electronics Marketing
- More than $250,000 to Hinman, Howard & Kattell, of Binghamton
- More than $3.4 million to Maryland Procurement Office, in Maryland
- More than $1.5 million to World Express Electronics, of Vestal.
Each of the aforementioned debts are through trade agreements; the debt to HH&K, however, is for services provided.
In a letter sent to EIT employees Wednesday, the company says it plans to meet its commitments to all customers, and that employee wages and health benefits are not expected to change as a result of the Chapter 11 filing.
"Workforce levels will continually be evaluated, as always, based on customer demands," the letter states.
The letter says EIT minority owners the Matthews family took full control of the company in 2013. The family is planning to make a bid to buy the company and "retain jobs in a restructured environment."
As a result, the company's interim CEO, Jim Matthews, Jr., -- who took over this spring after former CEO Jay McNamara resigned -- will step down to focus on the restructuring plan.
It's the latest in a series of blows for EIT.
In a court filing in April, McNamara told a federal judge if the company's private jet were taken away, and it lost a subsequent lawsuit, the result would likely be bankruptcy.
One of two occurred the following month, when U.S. District Court Southern New York Division Judge Jed S. Rakoff ordered U.S. Marshalls to seize the Hawker 800 corporate jet, which was at the time parked at Binghamton Regional Airport.
Canal Air, LLC -- a subsidiary of General Electric -- is suing Endicott Interconnect because the Broome County employer missed a nearly $77,000 rent payment on the private jet Canal owns.
In a separate lawsuit, Canal is asking for $11.5 million because EIT missed the payment. McNamara told the court a ruling for removal of the corporate jet would add prejudice to the subsequent $11.5 million lawsuit. The judge disagreed.
McNamara said in an April letter to the court that losing both lawsuits would cost the future of EIT, and the company's estimated 605 jobs.