Yes, but if you can pay off the creditors through asset shares there is no reason to have anyone "put in" anything new, no reason to issue more shares and no reason or justification for existing shares to be worthless.
I think there is some lax terminology being bandied around on this board. As part of the Chapter 11 process, a company does not "cancel" existing common shares. In many cases (not here, apparently), there are no assets left to be "shared" after creditors are paid. In some cases there is a debt for equity swap that has the effect of seriously diluting pre-existing common shareholders. However, if asset sales raise enough cash to pay off the debts then there is no need or reason for either of those things to happen.
The mechanism is pretty straightforward. In the event of a liquidation, there is a pecking order for who gets a piece of the assets. Creditors first, then preferred stockholders (if any) then common shareholders. However, there will not be a liquidation if CEMJQ is able to raise enough cash via asset sales to pay off the debts that are due. If they do that, shareholders still have their shares, each representing a pro-rata share of what is left. Presumably, what will be left is the earnings engine represented by those divisions not sold off, the assets still in those divisions, and a much-reduced set of liabilities (as the debts due in the immediate term would have been paid off).
Any purchase of CEMJQ for the long term has to be predicated on the conviction that they will raise enough cash from asset sales to pay off the debt obligations coming due soon and there will therefore NOT BE a liquidation.
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