A Chapter 11 bankruptcy can be a wise choice for many reasons. In a recent example, the owner of a Massachusetts club called T.T. the Bear’s admitted that this legal filing provided much-needed relief.
For many, the club had been a vital source for live rock ‘n’ roll music, hosting acts such as the Indigo Girls, Joan Jett, the Pixies, Arcade Fire, and many others. However, the club did not start out that way. Rather, its owner first opened the venue as a restaurant in 1981. Those early years were uncertain, and the owner fell behind in her tax payments. However, she had confidence in her business, so she filed for Chapter 11. The process included monthly reports to a bankruptcy judge. After two years, the owner was able to regain her footing, emerging with a new vision for a music venue. The switch was as simple as building a stage and removing some tables and chairs.
Unfortunately, the club did not own its location, but was simply a tenant. When the building changed ownership, the club encountered a stumbling block in its lease negotiations. The club recently hosted a flea market sale, coinciding with the announcement that it had failed to renew its lease.
There can be many challenges in operating a business. When debts become unmanageable, a Chapter 11 can provide legal restructuring and a timetable for paying creditors. Yet businesses can also experience difficulties in lease negotiations, as in this example. These challenges illustrate the importance of having a trusted business law attorney in one’s network. Our attorneys have served businesses throughout central Massachusetts in a variety of legal needs. We discuss our areas of focus, as well as the issues that a business may face in various stages of its life, in greater detail on our website.
Source: WBUR, “‘I Really Liked To Take Chances’–An Oral History Of T.T. The Bear’s,” Amelia Mason, July 22, 2015