If a company is operating as a chapter 11 debtors in possession, what happens to the shares of the company? What is the effect on stockholde...

Question

If a company is operating as a chapter 11 debtors in possession, what happens to the shares of the company? What is the effect on stockholders?

Thank you

Answer

As I think you know, and as I've already told you, in nearly every chapter 11 the shareholders are last in line for any distribution of assets and they are usually wiped-out.