Potential Claims and Priorities of Investors

Chances are excellent that the liabilities of a company in Chapter 7 bankruptcy exceed the value of the company’s assets. Therefore, when those assets are liquidated, at least some creditors are going to receive less than they are owed—and in some cases, nothing at all. The bankruptcy priority rules prescribe the order in which creditors are paid and thus determine which creditors get made whole and which are doomed to the land of cliché (