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Need an research paper on how the nature of the bankruptcy code affects the capital structure decisions of companies. Needs to be 9 pages. Please no plagiarism. Though the use of more debt capital in the capital structure has a lot of advantages, it has got some disadvantages too. When a company is going to liquidation due to bankruptcy, it has to repay the debt capital first. The equity shareholders will be paid back their investment only after setting off the secured creditors, debenture holders, preference shareholders…etc. So the companies should deeply analyze financial implications before making capital structure decisions. In the United Kingdom, a secured creditor can even proceed with liquidating the company and claim the amount due to him by the company. Even though the cost of capital plays an important role while taking the decision regarding the capital structure, the bankruptcy code also plays a prominent role in the decisions. Therefore, care must be taken while deciding the capital structure. The companies cannot make changes in the bankruptcy code, but they can make adjustments in the debt-equity combination (capital structure) of their financial structures in order to accommodate bankruptcy code considerations. This assumes importance since the interests of equity holders would be compromised or endangered if debt capital is allowed to mount beyond reasonable proportions or as needed by the organization. An increase in equity capital does not endanger the company’s existence or survival, however, creditors and loan syndicates could call back their loans, or bring an action for claim settlements, thus, putting the company at the doorsteps of bankruptcy. The UK bankruptcy code is a creditor-supportive and a debt-friendly code. That means the debt holders will be having the right in deciding the liquidation of the companies. “If the cash flows generated by the project are insufficient to meet debt payments, the firm is in default. Continuation decisions in default are regulated by the bankruptcy code in place.” (Acharya, Sundaram, and John, p.2).