It’s now official that Vince McMahon has filed for Chapter 11 Bankruptcy Protection (Restructuring Bankruptcy) . This move doesn’t officially announce the end of the XFL, but rather allows them to renegotiate through Bankruptcy Court with their creditors to reduce costs. The following was released by an unnamed League Spokesperson:
“The XFL quickly captured the hearts and imaginations of millions of people who love football.”“Unfortunately, as a new enterprise, we were not insulated from the harsh economic impacts and uncertainties caused by the COVID-19 crisis.”“Accordingly, we have filed a voluntary petition for relief under Chapter 11 of the U.S. Bankruptcy Code.”“This is a heartbreaking time for many, including our passionate fans, players and staff, and we are thankful to them, our television partners, and the many Americans who rallied to the XFL for the love of football.”Again, Chapter 11 is NOT the same as liquidation, or Chapter 7. This move is being done to minimize remaining losses and maximize returns to investors. Chapter 11 is very common practice among the business industry, as it allows a business to continue operations, while reducing costs and restructuring. This is the same as an individual filing Chapter 13 Bankruptcy, but for businesses.As for reports going around saying that the League has liquidated assets, that is completely incorrect. The XFL continues to operate with very minimal staffing. Chapter 11 Bankruptcy can be removed at any time once financial stability is proven to the courts by fulfilling the terms set forth in the restructuring plan that was submitted.
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