Taylor, bankruptcies can fall under one of two categories, reorganization or liquidation.

Reorganization involves DIP financing (debtor in possession) which is a bridge loan to pay the company's creditors while the company's obligations are reorganized under the supervision of a judge. The Republic pilot contract could be rewritten by the company and imposed by the judge once he approves it. Unprofitable contracts like the Delta flying could be shed or renegotiated. Shareholder equity would be wiped out, but the company would continue as a going interest with new shares of equity issued. This is the path the legacies, Frontier, Mesaba, and Mesa all took.

In a liquidation, the stock also goes to zero, but assets are auctioned off and the proceeds go to the bondholders and creditors. The company goes away.