A few days after filing for bankruptcy the Please Touch Museum received a huge helping hand from two anonymous donors.
The museum announced at a U.S. Bankruptcy Court hearing Tuesday that they received their first two donations, one for $1 million and another for $250,000, from the donors.
On Friday the children’s museum filed for Chapter 11 bankruptcy after borrowing more money than it could pay back to renovate a new home in Fairmount Park’s Memorial Hall. A reorganization plan was aimed at shedding most of the museum's $60 million debt to bondholders and negotiating a deal in which the museum turns over maintenance of Memorial Hall to the city.
Bankruptcy lawyer Lawrence McMichael says the action comes on the heels of an agreement reached Thursday with a committee representing bondholders with about half of the debt.
The two donations are part of a $10 million fundraising drive to pay a portion of a settlement the museum reached with its bondholders.
“Getting two substantial donations right out of the gate in this campaign is very encouraging,” said Please Touch Museum president and CEO Lynn McMaster. “While much work remains to achieve our $10 million goal, we read this as a clear sign of our treasured value to the region. The museum has received a lot of positive feedback from all corners of the donor community as news of the settlement has become public.”
Under the settlement, the bondholders will receive around $11 million to pay off the $60 million they are owed, officials with the museum said.
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“The burden of the bond obligation proved to be an impediment to our ability to raise funds because potential donors were reluctant to donate to an entity saddled with the bond obligation,” McMaster said. “That obstacle has now been removed.”
A Bankruptcy Judge approved all the motions the museum filed Tuesday. Officials with the museum say they’re allowed to use cash reserves to continue paying employees and maintain operations during the legal process. They hope to emerge from bankruptcy by the end of the year and meet the fundraising goal by next March.
The next status hearing is scheduled for October 15.
Despite the bankruptcy, the Please Touch Museum remains fully operational. CLICK HERE for information on visiting hours and exhibits.
