The fallout from the failure of Tennessee Commercial Bank continues to be seen in locations as far away as New York. When the Federal Deposit Insurance Corporation chose to shut down the popular Tennessee-based lender, it resulted in commercial bankruptcy filings for many companies that depended on the bank for loans.
Greek Peak, a ski resort outside of Syracuse, New York, filed for Chapter 11 protection to safeguard its assets as it begins restructuring. The restructuring became a necessity when the collapse of TCB resulted in the loss of loans and access to financing available through agreements with that company.
Bankruptcy does not mean the closure of the resort, and officials have stated that business will continue as usual during the proceedings and as the company attempts to emerge from bankruptcy. Chapter 11 protection secures the company's assets against outside interests and collection agencies while the company strives to return to profitability. The agreement with the court will allow the resort to continue operating. However, the court could close the resort at a later date.
The laws involved in Chapter 11 filing can be confusing to those more familiar with common legal issues for retail, service or hospitality industries. Fluency in bankruptcy law is required to correctly file the proper forms, gather background information and make a strong case for the continued operation of the business.
Most importantly, bankruptcy need not be the end of your company. There are different types of bankruptcy filings, and anyone facing unmanageable debt should be aware of which filing is right for them.
Source: Syracuse.com, "Greek Peak files to reorganize under U.S. Bankruptcy Court protection," Charley Hannagan, Aug. 3, 2012