Is Absolute priority a rule in bankruptcy?
|
  |
|
|
| Author |
Message |
luise
Apprentice
Joined: 22 May 2008
Posts: 3
|
 Posted: 07/21/08 - 07:30 Post subject: |
 |
|
| Hi there everyone. My name is Sally and I would appreciate if you could tell me something about a rule called absolute priority. Is Absolute priority a rule in bankruptcy? What is it all about and when it can be applied? Well, that would be all. Thank you in advance for your posts. |
|
|
Back to top
|
|
|
|
 |
guilbert
Apprentice
Joined: 21 May 2006
Posts: 9
|
| Posted: 08/19/08 - 21:50 Post subject: |
|
|
| Hi there Sally. Absolute priority is a rule in cases such as bankruptcy and liquidation. It defines in which order creditors are satisfied. According to this rule, when bankruptcy takes place, first to receive payments from liquidation mass are creditors. After the creditors, if there is anything left, shareholders receive payments. Off course, there is entire procedure about this. First, all assets have to be converted in cash and then court has to decide about the claims of each creditor. Absolute priority can also be applied in different occasions. For example, assets can be divided this way if the owner dies. That would be all from me. I hope that you will find this post useful. Take care! |
|
|
Back to top
|
|
|
|
|
|
| |
All times are GMT
|
| Page 1 of 1 |
Related topics: | |
|
|
