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Glossary Term: AUTOMATIC STAY

Definition(s) for AUTOMATIC STAY:


1. ) the suspension of actions, such as debt collection or foreclosure, against the company in bankruptcy. Occurs automatically when the bankruptcy petition is filed. This action protects the debtor from creditors seeking to seize its assets. It protects some creditorsby preventing one creditor from obtaining an excessive share of the assets of the bankrupt to the exclusion of the other creditors.



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