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Old 03-13-2007, 09:32 AM
StregaChess StregaChess is offline
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Default Bankruptcy Protection Stock Becomes?

Can anyone explain what this means?

HiEnergy Technologies, Inc


Is the stock going to disappear and just be worthless or will I still own shares if the company rises from the ashes?
Yes I knew it was a lottery ticket and a high risk investment. My brother-in-law is the LT. Commander of the bomb squad of one the largest city in the US (I think if I say I’m in trouble?) and had a good feeling about their products. So for better or worse I dropped a few pennies on this.

This phrase in the press release means?
“The Company intends to announce any notice of delisting, upon which it will evaluate the trading of its common stock in the pink sheets.”
Toilet paper?
Thanks in advance, even if it makes me feel stupid...
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Old 03-13-2007, 11:50 AM
AvivaSimplex AvivaSimplex is offline
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Default Re: Bankruptcy Protection Stock Becomes?

When companies go into bankruptcy, their shareholders generally lose everything. You might get 1% of the pre-bankruptcy value back after they go through liquidation.

[ QUOTE ]
“The Company intends to announce any notice of delisting, upon which it will evaluate the trading of its common stock in the pink sheets.”

[/ QUOTE ]
The company is currently trading on the OTC BB exchange (Over the Counter Bulletin Boards), which is for very small companies and has fairly lax requirements for a company to list its stock there. The company apparently expects that it will soon fail to meet even those requirements, and will be delisted. At that point, it will trade on the Pink Sheets, i.e. the bottom of the barrel exchange. This exchange has basically no listing or financial reporting requirements.
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Old 03-13-2007, 11:59 AM
StregaChess StregaChess is offline
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Default Re: Bankruptcy Protection Stock Becomes?

Thanks I'm sure the 1% will be eaten up by fees, LOL.. Oh well.

Sort of sad, they've got some cutting edge products that in a post 9/11 world should do very well. They just need to get to the next tier, its the speed of the testing that's the barrier.
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Old 03-13-2007, 04:02 PM
PairTheBoard PairTheBoard is offline
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Default Re: Bankruptcy Protection Stock Becomes?

What happens a lot of times is the company can no longer meet its debt obligations. Bond holders get their bonds converted to shares of the new common stock which is worth less than the bonds were. This allows the company to keep operating and come out of bankruptcy in financial health. However, the old stock holders are out in the cold. I think it's called Debt to Equity conversion. The new stock sometimes does quite well, but you're out of luck.

Sometimes they will get bought out for cash while in bankruptcy. The cash usually goes to pay the creditors and bondholders at pennies on the dollar with nothing going to the stockholders.

Sometimes they need protection from creditors to keep operating. They may be able to renegotiate with their creditors and come back out of bankruptcy with the stockholders bruised but still somewhat intact. Sounds like that's a longshot in this case.

PairTheBoard
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Old 03-13-2007, 04:58 PM
gazarsgo gazarsgo is offline
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Default Re: Bankruptcy Protection Stock Becomes?

is there any exchange that trades in corporate debt that an individual small scale investor can get into?
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