Goodnight, Sweet Prince

January 28, 2015

The news of the Prince Music Theater’s closing hit me pretty close to home. Although the Prince had been floundering for years, it’s still a sad day for the arts in Philadelphia. In late 2010, after years of staving off creditors, the Prince filed Chapter 11. With guidance and counsel from Slepner Law, the Prince navigated the waters of the bankruptcy process and emerged in 2013 with a viable plan of reorganization that was confirmed by the Bankruptcy Court.

In May 2014, however, Herb Lotman, the board chairman and the Prince’s final benefactor, died. The Lotman Estate decided that it no longer wanted to fund the Prince, and so that was that. A theater with an over 30-year history in the Philadelphia arts scene was to be no more.

What can we take away from the sad end of a great little theater? First, it’s important to have a good estate and succession plan in place. Nothing kills philanthropy like failing to plan. Second, it’s imperative that a corporate bankruptcy be handled by a skilled bankruptcy attorney and that the bankruptcy plan provides for effective reorganization. In the Prince Music Theater case, I successfully shepherded the theater through the Chapter 11 process before handing off the reins to a trusted colleague. The theater in fact had a plan for reorganization – a plan that rested squarely on the shoulders of Herb Lotman. Sadly, the road to reorganization for the Prince ended with Mr. Lotman’s untimely death and failure of his estate to include the theater in its plans.

tl;dr: If you are going through bankruptcy, hire a good bankruptcy lawyer. If you have assets, hire a good estate planning lawyer.