RE:RE:RE:RE:RE:RE:Ni dipped below $12 during today's session For another interesting reorg look at Reitman's recent use of creditor protection to reorganize. In the end creditors (landlords and suppliers) took 50 cents on the $1.00 while shareholders were not impacted at all. What's more, the monitor recommended that the creditors accept this proposal even though they acknowledged that in liquidation the creditors might have received more.
While reorgs generally follow the hierarchy of capital structure in terms of recovery, sometimes due to unique circumstances they do not.
Add to this the complication of to whom a director owes a fiduciary responsibility - which is generally to the corporation and through it its various stakeholders. This stakeholder group includes creditors, owners, employees, etc.