Elite Equipment Leasing: Crane Operator Fights DIP Lender Default in Montana Chapter 11

Elite Equipment Leasing, LLC and five affiliated crane rental and construction service companies filed for chapter 11 bankruptcy protection on September 7, 2025, in the U.S. Bankruptcy Court for the District of Montana. The Southern California-based enterprise—operating through Reliable Crane Service (the primary operating company founded in 2010), Champion Crane Rental (acquired in 2021), and related entities—carries approximately 194 employees, 138 of whom are union members, and maintains over $80 million in active work backlog including projects at the Las Vegas Athletics baseball stadium and the One Beverly Hills development. The filing followed financial pressures: two acquisitions that increased debt service costs, rising interest rates on floating-rate equipment loans, short amortization periods mismatched with cranes' 20-year useful lives, and project disruptions from California's January 2025 wildfires.

The case has evolved into a dispute between the debtors and their equipment finance creditors. Commercial Credit Group (the DIP lender) filed an emergency motion to confirm an event of default in December 2025, and the court denied the motion, keeping access to DIP financing intact. Meanwhile, secured equipment finance creditors including Dext Capital, Ford Motor Credit, Lincoln Automotive, and North Mill Equipment have contested the debtors' proposed adequate protection payments as insufficient to cover equipment depreciation, with a February 2026 hearing scheduled. With no plan yet filed and the company's fleet of 135+ cranes continuing to service construction projects across California, Nevada, Arizona, and Texas, the reorganization remains ongoing.

Reliable Crane: Western U.S. Crane Services Provider

The debtors collectively operate a crane rental and construction services business with operations spanning California, Nevada, Arizona, and Texas. The enterprise traces its origins to 2010, when Darrell Shaw founded Reliable Crane Service, LLC in Southern California. Shaw serves as CEO and has over 20 years of field operations experience. Mike Kale serves as Managing Director with more than a decade of industry experience, while Thomas Preston holds the CFO position. The company maintains its headquarters in Irvine, California, with work yards in Corona and Pacoima, California; Las Vegas, Nevada; and Phoenix and Scottsdale, Arizona.

The debtors' workforce comprises approximately 194 full-time employees distributed across these facilities, with 38 salaried personnel and 156 hourly workers. Approximately 138 employees—roughly 71% of the workforce—are union members and are subject to collective bargaining obligations. The company also engages five independent contractors who assist with sales, accounting, project management, and tower crane operations. Weekly payroll averages approximately $700,000, processed through ADP on a weekly basis for both salaried and hourly employees.

Fleet and capabilities. Prior to its 2021 acquisition of Champion Crane, Reliable operated a fleet of approximately 110 cranes. The Champion acquisition added roughly 25 additional cranes, bringing the combined fleet to approximately 135 units. According to court filings, the debtors own more than 500 pieces of heavy equipment spread across multiple states. The fleet includes hydraulic cranes ranging from 4-ton to 250-ton capacity, with boom lengths extending up to 350 feet. Specialty equipment includes a 33-ton Demag city crane that Champion offered exclusively in its market. All operators hold current NCCCO (National Commission for the Certification of Crane Operators) licenses, and the company reports a 2023-2024 Experience Modification Rate of 0.59.

Debtor structure. The six jointly administered debtors operate through integrated management and share overhead expenses:

Elite Equipment Leasing serves as the equipment ownership entity, purchasing and leasing cranes to the operating debtors. This structure—common in equipment-intensive industries—creates intercompany lease obligations that become relevant in equipment finance creditor disputes. Champion Crane Holdings, LLC functions purely as a holding company whose only asset is the stock of its subsidiary, Champion Crane Rental, Inc.

Major project history. Before the bankruptcy filing, Reliable Crane worked on projects demonstrating large-scale heavy-lift capabilities. At the Las Vegas Raiders Stadium (Allegiant Stadium), the company deployed more than 16 cranes onsite for structural iron work, including a pick of 775,000 pounds of steel modules at a 125-foot radius using a 1,350-metric-ton LR11350 crawler with wagon and luffer configuration. The project required over 6,000 tons of hoisting capabilities. At the LA Rams/Chargers Stadium (SoFi Stadium), Reliable Construction Services handled ground crane operations and erected a 1250B Tower crane—one of only six in the world—using a 550-ton crane.

Current backlog. The debtors maintain over $80 million in work backlog. Two projects anchor this backlog: the Las Vegas Athletics baseball stadium, where the debtors began work in the months preceding the filing and expect the project to continue through 2028; and One Beverly Hills, a 17.5-acre development that will unify the historic Beverly Hilton and Waldorf Astoria hotels with over 10 acres of public and private botanical gardens, luxury retail, and dining offerings. Court filings describe both as long-term revenue sources expected to support the debtors' ability to service restructured debt.

Acquisition-Driven Financial Distress

The debtors' path to bankruptcy reflects acquisitions financed with debt structures misaligned to underlying asset economics, followed by interest rate increases that raised cash flow demands.

2020 Bigge Crane acquisition. The first event occurred in 2020, when Reliable Crane acquired 20 tower cranes from Bigge Crane & Rigging Co. According to the First Day Declaration submitted by CRO Curt Kroll, financing payments associated with the acquisition were initially $90,000 per month but have since increased to $160,000 per month—a 78% increase. The CRO noted that all payments are currently applied to interest only, meaning the debtors have made no progress reducing principal despite years of payments.

2021 Champion Crane acquisition. The second acquisition occurred in October 2021, when Reliable Crane acquired Champion Crane Rental, Inc., a Pacoima, California-based crane rental company founded in 1983 by Mike Konle. The deal added approximately 25 cranes to Reliable's existing fleet of 110 and brought 20-25 employees into the combined workforce. Champion's specialization in motion picture and production work, theme park attractions, and special effects complemented Reliable's focus on utility and infrastructure projects.

The acquisition was financed through a Small Business Administration (SBA) loan from Celtic Bank Corporation. Both Champion Crane Holdings and Champion Crane Rental became obligors under the Celtic loan and granted Celtic first-position liens on all their assets. As of the petition date, Celtic was owed approximately $3.34 million. The deal gave Reliable what CEO Darrell Shaw described at the time as "a foothold on the north side of Los Angeles" while its primary hub remained in Corona on the south side.

Court filings identify challenges with dispatch and accounting software systems during integration. At the time of the acquisition, Shaw expressed ambitions to acquire "10-12 companies over the next 5-10 years."

Rising interest rates and structural mismatch. The First Day Declaration identifies several loans carrying floating interest rates calculated at SOFR plus 2%, exposing the debtors to rate increases that began in 2022. As rates rose from near-zero to over 5%, floating-rate payments increased.

The CRO identified an additional structural problem: short amortization periods on equipment financing loans despite the long useful life of the crane equipment. Court filings note that much of the debtors' heavy equipment has life spans exceeding 20 years, yet financing loans were amortized over much shorter periods. This mismatch creates elevated debt service requirements that don't align with the underlying asset economics or revenue generation capacity.

Failed refinancing and strategic alternatives. Before filing, the debtors and their advisors—including multiple financial advisors and an investment banking firm retained since 2022—explored alternatives. These efforts included: refinancing attempts with various lenders; potential mergers and sale transactions with strategic partners, at least one of which reached a signed term sheet before failing to close; and discussions with potential investors. Earlier in 2025, the debtors entered into a non-binding term sheet with a major bank to refinance all equipment loans, but that transaction also failed to close.

Within months of the filing, the debtors received a letter of intent from a potential lender willing to refinance secured debt in connection with a chapter 11 filing, but the terms were substantially more expensive than the DIP financing ultimately obtained from CFI. No party approached was willing to offer postpetition financing on terms more favorable than CFI's proposal.

California wildfire impact. The January 2025 California wildfires added to the debtors' operational challenges. The fires burned over 37,000 acres in Los Angeles, destroyed more than 16,000 buildings, and caused an estimated $250-$275 billion in damages—making them the most expensive wildfires in U.S. history. For crane service providers operating in the affected region, the fires created project delays and schedule disruptions. Industry analysts note that the combined demand for new construction and rebuilding efforts has created extended lead times for materials and labor, pushing project schedules further out and straining contractor cash flows.

DIP Financing and the December Default Dispute

The debtors secured debtor-in-possession financing from their prepetition asset-based lender, Commercial Funding Inc. (CFI), and its affiliate Commercial Credit Group Inc. (CCG). The relationship became contentious, culminating in a December 2025 emergency motion to confirm an event of default, which the court denied.

Prepetition capital structure. The debtors' prepetition secured debt reflects multiple lender relationships and a complex lien priority structure:

CFI serves as the debtors' primary asset-based lender, providing working capital financing through a revolving line of credit secured by liens on all debtors' assets, including cash collateral. All debtors are obligors under the CFI loan, which is cross-collateralized by assets of all debtors. Commercial Credit Group is CFI's affiliate and the debtors' largest equipment lender, having provided PMSI (purchase money security interest) financing for numerous pieces of equipment across 18 separate financing agreements. CCG's blanket liens are subordinate to CFI's liens on the operating debtors but take priority on equipment specifically financed by CCG.

DIP facility structure. The DIP facility provides up to $26 million in postpetition financing, continuing the prepetition lockbox arrangement where customer payments flow into a CFI-controlled account. Unlike the prepetition borrowing base formula, the DIP arrangement advances funds based on the debtors' projected weekly expenses per an agreed-upon 13-week budget. The facility provides more than $2.2 million in additional revolving liquidity above the prepetition credit line balance.

The court entered the Final DIP Order on October 14, 2025, approximately five weeks after the petition date. The order established budget-controlled disbursements, replacement liens for prepetition secured creditors, and various covenants governing the debtors' operations during the case.

December 2025 default dispute. The DIP lender relationship became contentious in December 2025:

On December 16, 2025, Commercial Credit Group and Commercial Funding filed an Emergency Motion to Confirm Event of Default, alleging the debtors had violated DIP covenants. The court set an emergency hearing for December 17. Two days later, on December 19, the court denied the DIP lender's motion, addressing the interpretation of default provisions and covenant compliance issues. The denial kept access to DIP financing intact.

Following the denial, CFI filed a notice approving an interim budget, and the DIP lender filed a limited objection to the debtors' Adequate Protection Motion, conditioning consent on payments conforming to the approved budget.

Commercial Credit Group profile. CCG's $513.8 million term ABS transaction in October 2025—its 20th and largest securitization to date—was led by Bank of America Securities as structuring agent and lead bookrunner. The Charlotte, North Carolina-based lender has been in business for over 21 years, having financed more than $8 billion in equipment across 38,000+ loans and leases.

Equipment Finance Creditor Conflict

The case includes contested matters involving secured equipment finance creditors who hold PMSI liens on specific cranes and other equipment. These creditors argue that the debtors' proposed adequate protection is insufficient given ongoing equipment depreciation.

Secured equipment creditors. Beyond CFI and CCG, numerous equipment finance creditors have actively participated in the case:

Adequate protection dispute. The core dispute centers on the debtors' December 5, 2025 Motion for Adequate Protection, which proposed interest-only payment terms for secured equipment finance creditors. Equipment finance creditors argue this approach fails to account for the ongoing depreciation of their collateral—cranes and heavy equipment that lose value through use and market conditions even as the debtors continue operating them.

Dext Capital, holding approximately $4.6 million in secured claims, filed multiple objections on December 19-20, 2025, contesting the adequacy of proposed interest-only payments. North Mill Equipment Finance filed its own objection on December 19, similarly arguing that payments should account for equipment depreciation, not merely cover interest costs.

The dispute concerns whether interest-only payments address collateral depreciation while the equipment remains in use. The matter is scheduled for hearing on February 3, 2026.

Stay relief activity. Several equipment creditors have sought relief from the automatic stay to repossess their collateral. 1st Source Bank filed the first such motion on September 24, 2025, shortly after the petition date. Ford Motor Credit and Lincoln Automotive Financial Services filed parallel stay relief motions on December 12, 2025. These motions seek authority to pursue remedies against specific collateral.

UCC Activity and Contested Matters

The Official Committee of Unsecured Creditors has played an active role in the case, including filing an adversary proceeding and opposing the DIP lender's default motion.

UCC adversary proceeding. On December 12, 2025, the UCC filed an adversary proceeding—a separate lawsuit within the bankruptcy case—though the specific nature of the claims has not been detailed in available filings.

The UCC opposed the DIP lender's December 2025 default motion, aligning with the debtors in arguing that no event of default had occurred.

Professional retentions. SierraConstellation Partners, LLC serves as the debtors' CRO and financial advisor, with Curt Kroll of SierraConstellation appointed as Chief Restructuring Officer. Kroll holds both bachelor's and master's degrees in accountancy from the University of Missouri and is a licensed CPA (inactive). His experience includes CRO roles, interim management, refinancings, distressed acquisitions, and restructurings across retail, industrial manufacturing, real estate, financial services, and healthcare. SierraConstellation was retained and began working with the debtors approximately in April 2025—several months before the September filing.

Local Montana counsel is provided by Patten, Peterman, Bekkedahl & Green PLLC, while Lesnick Prince Pappas & Alverson LLP (Los Angeles) serves as lead debtor counsel, with several attorneys admitted pro hac vice.

Crane Rental Industry Context

The debtors operate in the U.S. crane rental services market, which generated approximately $13.9 billion in revenue in 2024 and is projected to reach $17.9 billion by 2030, representing a 4.4% compound annual growth rate. Mobile cranes dominate the market with approximately 55% of 2024 revenue, preferred for their ease of transportation between job sites.

Market dynamics. The North America crane rental market shows even stronger growth projections, anticipated to expand from $5.55 billion in 2024 to $14.43 billion by 2033 (11.2% CAGR). Wheel-mounted mobile cranes commanded 45.4% of market share in 2024, while the construction segment accounted for 64.6% of overall demand. Major players include United Rentals, Maxim Crane Works, Caterpillar Inc., All Erection & Crane Rental Corp., and Lampson International LLC.

The industrial equipment rental and leasing industry in the United States—the broader category encompassing crane rental—reached $56.6 billion in market size for 2025.

Equipment finance trends. The equipment finance industry expanded to an estimated $1.34 trillion in 2023, with construction machinery showing 78% private financing activity—among the highest of any equipment category. Approximately 82% of end-users employ some form of financing for equipment and software acquisitions, with construction industry end-users at 85%, the highest of any sector.

These statistics show high financing penetration in equipment-intensive businesses like crane rental.

Industry challenges. A 2025 industry analysis notes that the construction sector faces rising costs, shrinking labor pools, and ongoing supply chain issues. Approximately 32% of surveyed end-users cited labor costs and/or scarcity as reasons for financing additional equipment—using capital equipment to offset labor constraints. The construction trade workforce is aging: workers under 25 represented 10.8% of the sector in 2024 but dropped to 9% in 2025.

In a high-interest-rate environment, companies are increasingly exploring flexible financing options including leasing and pay-per-use models. Equipment-as-a-Service and subscription-based financing models continue to rise, reflecting industry adaptation to capital constraints and interest rate sensitivity.

Key Timeline

Frequently Asked Questions

What companies are involved in this bankruptcy?

Six jointly administered entities filed chapter 11 petitions: Elite Equipment Leasing, LLC (lead debtor that owns and leases equipment); Reliable Crane Service, LLC (primary operating company); Reliable Construction Services, LLC; Champion Crane Rental, Inc. (acquired 2021); Champion Crane Holdings, LLC (holding company); and Reliable Phoenix, LLC (Arizona operations). All operate through a single management team and share overhead expenses. Elite Equipment Leasing owns cranes and leases them to the other entities, which perform the actual crane rental and construction services work.

What caused the bankruptcy?

Multiple factors increased cash flow demands: (1) a 2020 acquisition of 20 tower cranes from Bigge that increased monthly financing payments from $90,000 to $160,000—with all payments currently applied to interest only; (2) the 2021 Champion Crane acquisition, which court filings describe as difficult to integrate, particularly regarding dispatch and accounting software systems; (3) rising interest rates on floating-rate loans (SOFR plus 2%) as the Federal Reserve hiked rates; (4) short amortization periods on equipment financing loans despite cranes having 20+ year useful lives; (5) multiple failed refinancing attempts, mergers, and sale transactions; and (6) project disruptions from California's January 2025 wildfires.

What is the company's current operational status?

The companies maintain over $80 million in active work backlog, including projects at the Las Vegas Athletics baseball stadium (expected to continue through 2028) and the One Beverly Hills development. The debtors employ 194 workers, approximately 138 of whom are union members, across facilities in California, Nevada, Arizona, and Texas. The debtors hold approximately $20.9 million in accounts receivable, of which an estimated 85% is collectible—contingent on continued operations.

What happened with the DIP default dispute?

Commercial Credit Group and Commercial Funding (the DIP lenders) filed an emergency motion on December 16, 2025, alleging the debtors had violated DIP covenants and seeking to confirm an event of default. After an emergency hearing, the court denied the motion on December 19, 2025, addressing covenant interpretation and compliance issues. The denial preserved the debtors' access to DIP financing.

Why are equipment finance creditors objecting?

Multiple secured equipment finance creditors—including Dext Capital (approximately $4.6 million claim), Ford Motor Credit, Lincoln Automotive, and North Mill Equipment Finance—argue that the debtors' proposed interest-only adequate protection payments are insufficient because they fail to account for depreciation of the crane equipment collateral. These creditors contend that their collateral loses value through use during the bankruptcy case, and adequate protection should compensate for this diminution. A hearing is scheduled for February 3, 2026, to resolve this dispute.

Why was the case filed in Montana?

The case is pending in the U.S. Bankruptcy Court for the District of Montana (Billings Division) before Judge Benjamin P. Hursh, despite the debtors' headquarters being in Anaheim, California. The specific venue selection reasoning is not publicly disclosed, though the filing was described as a "freefall" chapter 11 triggered by wildfires and project delays.

Who is Commercial Credit Group?

Commercial Credit Group Inc. (CCG), headquartered in Charlotte, North Carolina, serves as both the DIP lender (through its affiliate Commercial Funding Inc.) and the debtors' largest equipment lender, holding approximately $18.2 million in prepetition claims across 18 separate PMSI financing agreements. CCG has been in the equipment finance business for over 21 years, having financed more than $8 billion in equipment across 38,000+ loans and leases. In October 2025, CCG completed its largest-ever ABS transaction at $513.8 million.

What was the Champion Crane acquisition?

Reliable Crane acquired Champion Crane Rental, Inc. in October 2021, adding approximately 25 cranes to Reliable's existing fleet of 110 and bringing 20-25 employees into the combined workforce. Champion, founded in 1983 and previously owned by Mike Konle, specialized in motion picture and production work, theme park attractions, and special effects—complementing Reliable's focus on utility and infrastructure work. The acquisition was financed through an SBA loan from Celtic Bank ($3.34 million outstanding as of the petition date) and gave Reliable a foothold in north Los Angeles while its primary hub remained in Corona.

What is the current case status?

As of late December 2025, no plan of reorganization or disclosure statement has been filed. The court granted an exclusivity extension on December 23, 2025, preserving the debtors' exclusive right to file a plan. A pending matter is the February 3, 2026 hearing on the debtors' Adequate Protection Motion, which will determine how secured equipment finance creditors are treated during the case. The UCC filed an adversary proceeding in December 2025, and several equipment creditors have filed stay relief motions seeking to repossess their collateral.

What is the crane rental market outlook?

The U.S. crane rental market is projected to grow from $13.9 billion in 2024 to $17.9 billion by 2030 (4.4% CAGR), while the broader North America crane rental market is expected to reach $14.43 billion by 2033 (11.2% CAGR). Mobile cranes dominate with 55% market share, and the construction segment accounts for 64.6% of demand. However, the industry faces challenges including rising costs, labor shortages (workers under 25 dropped from 10.8% to 9% of the workforce between 2024 and 2025), and high interest rates affecting financing costs—factors that contributed to the debtors' distress.

Who is the claims agent for Elite Equipment Leasing?

Epiq Corporate Restructuring, LLC serves as the claims and noticing agent. The firm maintains the official claims register and distributes case notifications to creditors and parties in interest.

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