Bankruptcy Forms: Filing Bankruptcy Chapter 7 Bankruptcy Software Chapter 13

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TITLE 11–BANKRUPTCY

CHAPTER 7–LIQUIDATION

Sub Chapter III – Stockbroker Liquidation

Sec. 747. Subordination of certain customer claims

 Except as provided in section 510 of this title, unless all other 
customer net equity claims have been paid in full, the trustee may not 
pay in full or pay in part, directly or indirectly, any net equity claim 
of a customer that was, on the date the transaction giving rise to such 
claim occurred--
        (1) an insider;
        (2) a beneficial owner of at least five percent of any class of 
    equity securities of the debtor, other than--
            (A) nonconvertible stock having fixed preferential dividend 
        and liquidation rights; or
            (B) interests of limited partners in a limited partnership;

        (3) a limited partner with a participation of at least five 
    percent in the net assets or net profits of the debtor; or
        (4) an entity that, directly or indirectly, through agreement or 
    otherwise, exercised or had the power to exercise control over the 
    management or policies of the debtor.

(Pub. L. 95-598, Nov. 6, 1978, 92 Stat. 2613; Pub. L. 97-222, Sec. 13, 
July 27, 1982, 96 Stat. 238.)


                      Historical and Revision Notes

                        senate report no. 95-989

    Section 747 subordinates to other customer claims, all claims of a 
customer who is an insider, a five percent owner of the debtor, or 
otherwise in control of the debtor.


                               Amendments

    1982--Pub. L. 97-222 substituted ``the transaction giving rise to 
such claim occurred'' for ``such claim arose'' in provisions preceding 
par. (1).


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Note: For affordable legal assistance The Center For Debt Management highly recommends Standard Legal's Do-It-Yourself Bankruptcy Forms Software Kits. For credit repair services,
the most trusted law firm in America with over 15 years of experience is Lexington Law Firm.

For more bankruptcy help and bankruptcy alternatives, go to Bankruptcy Resources

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Legal Resource Center: United States Code TITLE 11 Filing Bankruptcy Forms Software