Legal Question in Bankruptcy in California
What happens to stock in a company that files for bankruptcy
What happens to stock in a company that files for bankruptcy? I work for Pacific Gas and Electric company. If this company files for bankruptcy, what will happen to all of the stock that I own? Will it be worthless paper?
Asked on 1/08/01, 6:11 pm
1 Answer from Attorneys
Ken Koury
Kenneth P. Koury, Esq.
Re: What happens to stock in a company that files for bankruptcy
It depends on what kind of bankruptcy is filed and whether the Company continues to stay in business after the bankruptcy. For example, if a business files a Chapter 11 bankruptcy and continues to do business afterward, then the stock will have whatever value market forces place on it. If the Company fails to continue in business and has no assets than the stock would probably be worth nothing.
Answered on 1/12/01, 4:27 am
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