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U.S. Code as of:
01/19/04
Section 510. Subordination
(a) A subordination agreement is enforceable in a case under this
title to the same extent that such agreement is enforceable under
applicable nonbankruptcy law.
(b) For the purpose of distribution under this title, a claim
arising from rescission of a purchase or sale of a security of the
debtor or of an affiliate of the debtor, for damages arising from
the purchase or sale of such a security, or for reimbursement or
contribution allowed under section 502 on account of such a claim,
shall be subordinated to all claims or interests that are senior to
or equal the claim or interest represented by such security, except
that if such security is common stock, such claim has the same
priority as common stock.
(c) Notwithstanding subsections (a) and (b) of this section,
after notice and a hearing, the court may -
(1) under principles of equitable subordination, subordinate
for purposes of distribution all or part of an allowed claim to
all or part of another allowed claim or all or part of an allowed
interest to all or part of another allowed interest; or
(2) order that any lien securing such a subordinated claim be
transferred to the estate.
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