Absolute priority rule and its use in bankruptcy
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ravid
Apprentice
Joined: 04 Jun 2006
Posts: 16
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 Posted: 07/29/08 - 06:06 Post subject: |
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| Couple of years ago I have invested my money in a company where my wife used to work before going to maternity. I really thought this company will expand its business and that it would bring me more money. I was wrong. Company went bankrupt. That is why I need to know more about absolute priority rule and its use in bankruptcy. |
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thedrick
Apprentice
Joined: 18 Mar 2007
Posts: 3
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| Posted: 08/28/08 - 03:01 Post subject: |
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| Since your company bankrupted that means that everything is liquidated. So because of the absolute priority rule creditors will took what was owed to them. Since you are shareholder you can only divide whit the other shareholders what is left after creditors took their own debt. There are cases where shareholders did not split anything. I hope this will not happen to you. |
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