The Southeast Asia Corporation (SAC) is to be liquidated. The market value of its assets is $16.3 million. Bonds with a face value of $5.6 million are unsecured. SAC has no subordinated debentures outstanding; shareholders’ equity has a market value of $1.95 million; $850,000 is used to cover administrative costs and other claims (including unpaid wages, pension benefits, legal fees, and taxes).

The company has a liquidating value of $14 million. Of this amount, $8 million represents the proceeds from the sale of their flagship Indonesian resort.

As a trustee in bankruptcy, you wish to follow the bankruptcy law strictly. What is your proposed distribution?