The refiner's fire: how flying J emerged from bankruptcy with new wings.

• Author: Kinder, Peri
• Position: Lessons Learned

No one guessed that oil prices would plunge from $145 per barrel to less than $40 per barrel in six months, but that's exactly what happened between July and December 2008. After hitting an all-time high, the demand for oil dropped significantly, sending prices into a ditch. Oil companies lost billions of dollars, creating a perfect storm for Utah-based Flying J, Inc.

After oil prices crashed, credit markets stalled, leaving Flying J with no cash to work with. Banks weren't giving out loans and by December 2008, with no cash in hand, executives at Flying J knew bankruptcy was imminent. CEO J. Phillip Adams resigned and Crystal Maggelet--daughter of Flying J founder Jay Call--stepped in to take over as CEO in January 2009.

Back from the Brink

Having served on the company's board of directors since 1982, Maggelet was no stranger to Flying J leadership. She immediately started doing everything she could to get the company back on its feet. Her intention was to emerge from bankruptcy with creditors paid off and the Flying J reputation restored with as little disruption as possible.

"I knew I was diving in over my head to take on this business," she says, "which at the time was the 16th-largest private company. I knew the skills I had were to treat people the way I'd want to be treated and to be honest:'

The company, which had recorded $18 billion in sales, began selling assets and finding ways to pay back creditors to the tune of $1 billion. Maggelet started the process to shut down and sell the refinery in Bakersfield, Calif. and to sell the Longhorn Pipeline on the Gulf Coast. The company had 300 million barrels of oil, 250 Flying j travel centers, the Big West oil refinery in North Salt Lake, THC credit card processing and the Transportation Alliance Bank based in Ogden.

"It wasn't that we didn't have a viable business going forward," Maggelet says. "We basically just ran out of cash. What Chapter 11 does, it allows you to draw a line in the sand and move forward, and that's what we did."

Part of moving forward included laying off 2,500 employees-17 percent of the company's workforce, a difficult decision for Maggelet. But after 18 months of bankruptcy, in July 2010, a U.S. Bankruptcy Court approved Flying J's reorganizational plan allowing the company to resume regular business practices. Now, working under the name FJ Management, the company has used the bankruptcy as an opportunity to improve.

"The better the relationships you can form...