American LaFrance said it has filed a voluntary petition for relief under Chapter 11 in the U.S. Bankruptcy Court for the District of Delaware. The company will request approval of $50 million in debtor-in-possession financing from its pre-bankruptcy lenders.

American LaFrance said it had significant operational difficulties after separating from its former parent company Freightliner. To address these operational problems and to fund general operating expenses, American LaFrance has incurred approximately $150 million in secured debt since the business was purchased from Freightliner. American LaFrance said its problems have resulted in slowed production, large unfilled backlog and insufficient funds to operating. Part of the company's problems stem from ongoing difficulties in switching from Freightliner's computer system to a new information technology system.

Freightliner bought American LaFrance in 1995, then sold it in December 2005. Last year, American LaFrance opened a new $62 million headquarters and manufacturing facility in North Charleston, S.C.

The company also will file a plan of reorganization along with a motion for sale in case the plan of reorganization is not approved. It is anticipated that the reorganization process will be completed in less than 90 days, at which time the company will emerge from bankruptcy with ample liquidity for ongoing operations and a more viable debt structure. By filing Chapter 11 and doing it voluntarily, will allow the company to negotiate the terms of and participate in its restructuring.

The company will file motions to honor customer warranties and employee wages, among other relief, saying that it intends to honor its obligations to supply vehicles that are supported by performance bonds.

American LaFrance said it plans to restart its manufacturing operations on March 10. At that time, the company will advise its dealers when to expect delivery of backordered apparatus. The company said its IT problems have also affected its parts business, a situation it said will be corrected rapidly.

The company also said it will stop making ambulances and close its ambulance plant in Sanford, Fla.

In December, the company furloughed many of its manufacturing employees. It plans to bring those employees back on March 10, and have a work force of 800. In 2005, its work force was 1,200.

The company will continue to operate its manufacturing facilities and provide repair services as a debtor-in-possession. The company has retained William K. Snyder, with CRG Partners Group, as chief restructuring officer.