Over 10 years ago, I bought stock in Boston Market. Around 2004, I got a notice that Boston Market had gone bankrupt and my stock was now worthless. BUT..Boston Market is still in business!! How can they continue to sell chickens and my stock continues to be worthless? Will my stock ever have any value again?
1 Answer from Attorneys
While I have not researched the point, I believe that McDonald's Corporation bought the assets of Boston Market while Boston Market was in bankruptcy.
Typically, in such situations, the money paid by the buyer is used to pay off secured creditors first, then unsecured creditors. Stockholders, as owners of a company, are typically paid last from any proceeds - and often there are no proceeds left for stockholders. This results in your stock being worthless.
I just googled BM, and found this interesting link: http://www.usatoday.com/money/industries/food/2009-09-28-boston-market-comeback_N.htm
So while it looks like your investment may be worth nothing, you could frame the stock certificate and value it as a keepsake - perhaps a reminder that the stock market is a gamble.
Best wishes for better luck in 2010!
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