LINN Energy (fka LINEQ)

[1manband]

So if I were to buy today and oil continues to rally that theres no way they could get out of debt/bankruptcy and the shares are destined to be worthless?

Almost certainly that is correct.

If the price of oil was rising and cash flow improved enough to cover the massive debt obligations before the bankruptcy was filed, there would have been a chance. But once the bankruptcy was filed, and the Plan of Reorganization filed with the Court, the opportunity for any payment to common shareholders has passed.

The prices of oil and gas have risen slightly, but are still far below what Linn would need under its old capital structure to meet is obligations. However, it will help the new Linn Energy and bring greater confidence to the Reorganization Plan, which is reliant upon the sale of $530 million in new common stock to help partially pay off the old debtors and creditors. It also may help the unsecured creditors get more of what they are owed, as they are only going to be repaid a portion of their outstanding claims.

I suggest you read the Court Filings, especially the amended Plan of Reorganization. Or, at least read the SEC filings, in particular the most recent 10-Q, which contains a summary of the Plan, including the all important statement:

"All existing equity interests of the Company will be extinguished without recovery"

https://www.sec.gov/Archives/edgar/data/1326428/000132642816000092/line930201610q.htm