/biz/ - Business & Finance

Key points:
>Another acquisition vehicle is a Chapter 11 Debt for Equity plan of organization.
>This means that pre-petition equity owners cannot retain their equity ownership unless the unsecured creditors who have priority are paid in full.

Meaning Class 9 can't be preserved until all classes before it are satisfied due to the absolute priority rule.

>In most cases, it's impossible for Chapter 11 Debtors to satisfy the claims of the bondholders/unsecured creditors, but in lieu of payment, they can receive controlling interest in the equity of the reorganized debtor.