Prepetition Liability

(redirected from Pre-Petition Liabilities)

Prepetition Liability

A liability that a company incurs before filing for bankruptcy protection. Most prepetition liabilities are reduced or discharged in bankruptcy proceedings; the person or company to whom a prepetition liability is due should not expect to receive the full value of the liability unless it is secured by some asset. A prepetition liability contrasts with a postpetition liability, which usually must be paid in full.
References in periodicals archive ?
When the Plan of Adjustment is confirmed by the court, the pre-petition liabilities that are subject to the plan are discharged, and the government is bound to the new debt and payment terms m the plan.
Pre-petition liabilities subject to compromise -- including liabilities that may be impaired by a plan, and that are eligible for compromise because they are either unsecured or undersecured.
Realize, however, that filing a petition generally causes the payment of unsecured or undersecured pre-petition liabilities to be prohibited before the plan is confirmed.
The balance sheet clearly should distinguish pre-petition liabilities subject to compromise from those that are not and identify post-petition liabilities.
Further, use of allowed amounts is consistent with measurement principles used for other pre-petition liabilities and, therefore, comparability is enhanced.
The risks and uncertainties and the terms of any reorganization plan ultimately confirmed can affect the value of the NBC Companies' various pre-petition liabilities, common stock and/or other securities.
A plan or plans of reorganization could result in holders of the Company's common stock or other equity interests and claims relating to pre-petition liabilities receiving no distribution on account of their interest and cancellation of their interests and their claims and cancellation of their claims.
A plan or plans of reorganization could result in holders of Citadel's common stock or other equity interests and claims relating to pre-petition liabilities receiving no distribution on account of their interest and cancellation of their interests and their claims and cancellation of their claims.
Similarly, these and other factors, including the terms of any reorganization plan ultimately confirmed, can affect the value of the Company's various pre-petition liabilities, common stock and/or other equity securities.
Accordingly, the Company urges that appropriate caution be exercised with respect to existing and future investments in Dura's common stock or other equity interests or any claims relating to pre-petition liabilities.
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