Replies to post #4050 on DigitalTown, Inc. (DGTW)

[Xman4]

DGTW: Great work Stervc

[HDOGTX]

$DGTW with Commons surviving count me in for the next $BRTXQ runner...

[Zardiw]

Good Chapter 5 Implications for $DGTW:

What this is saying is that creditors do not absolutely have priority over shareholders, which is huge. And also any plan only has to be somewhat better than total liquidation, which is also huge.

One of the important differences between a Chapter 11 and a Chapter 5 is that a Chapter 5 has no creditor committee. In a Chapter 11, a creditor committee can be a serious obstruction to having a plan approved. In fact, in a Chapter 11, a single creditor can stop such a plan from being approved. In a Subchapter 5 by contrast, there is no absolute priority rule. Furthermore, other than the initial filing fee, fees are essentially eliminated, making the process much less expensive to the petitioner.

In a Subchapter 5, if the creditors can’t agree on the petitioner’s proposed plan, an application can be made to the Bankruptcy Court Judge to order the plan approved, sometimes referred to as a “cram down”. The success of such a proposed plan need only be more attractive to the unsecured creditors than would a conversion to a Chapter 7 liquidation plan, which often is not a very difficult threshold to meet.

Also, this will all happen pretty fast:

the process is much more advanced. The plan must be submitted for approval with 90 days,

z