When a person or entity buys or takes over a business, the deal may also include various amounts of pre-existing debt. Business owners in Maryland and across the country may believe they are able to achieve success eventually, but in the meantime, financial reorganization may be necessary. When facing a similar situation, a business owner could choose to obtain assistance in the process by filing for Chapter 11 bankruptcy.
This appears to be the case for a YMCA in another state. A new director and board have taken control of the business, and have advised that the entity inherited almost $5 million in previous debts. After attempting to transition into a more successful direction, the YMCA has recently filed for bankruptcy, acknowledging an inability to settle all of the claims against the business.
Chapter 11 bankruptcy allows a business to remain operational while attempting to restructure finances over a given period of time. This is likely an important factor for many businesses who wish to stay open and provide services for customers. The YMCA provides numerous services to families in need, and this process may provide the opportunity for continued investment in the future of the children and families it serves.
A great deal of businesses in Maryland and elsewhere have chosen to file for bankruptcy in an attempt to regain control of financial circumstances. Reorganization of finances can allow a business to become prosperous once again. Filing for bankruptcy may also provide a business with protection from debtors throughout this period. The process can be complex, and many business owners seek guidance and assistance from an experienced attorney throughout this crucial transition.
Source: mlive.com, “Upper Peninsula YMCA files for Chapter 11 bankruptcy”, Jim Harger, May 5, 2017