Ummm... what?
No. It's chapter 11.
Nothing is being liquidated.
It just declares all existing contracts null and void.
The bankruptcy court will determine at what percentage the creditors (I believe that bondholders were the holdouts in this case) will be paid.
As I understand it, there were only 4 bondholders who refused to renegotiate. I believe the courts will allow the others to live with the concessions they made before the filing. Will possibly tell the 4 holdouts to go and pound sand.
(It has even been speculated that the holdouts were also bondholders in Ford and GM. They had a vested interest in Chrysler tanking. It's all about the almighty dollar. Screw everybody else.)