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Gold/Mining/Energy : ATPG Shareholders
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To: billgatesisevil who wrote (154)8/29/2012 3:51:54 PM
From: billgatesisevil  Read Replies (1) of 3620
 
I should explain why these loans are afforded that kind of uber-superior status. The law recognizes that it is better to have a company survive in some form than to have it go into chapter 7. If nothing else, some of the jobs of the employees may be salvaged. In order for them to do so, they almost always require some sort of funding during the period before they emerge. They also are not the best of credit risks. I mean, shit gang, these are companies that are bankrupt. The law thus allows them to seek a loan that will see them through the process till they emerge. Now, are you going to loan an estate money and pray that it doesn't turn into a Dickens novel and have the lawyers eat it with their fees? Not me, and not any DIP lender I have ever heard of. Thus the court allows the DIP lenders to go to the head of the trough when it comes to disbursements at the end of the bk period. Quite simple and logical actually.
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