CRAMMED DOWN

1. A situation in which venture capitalists refuse to invest in a new project unless the preceding investors of the company lower the value of their original investment.

2. A bankruptcy procedure that allows a bankruptcy court to initiate a reorganization plan for a company despite objections from creditors. The creditors will still maintain collateral on the company as long as the firm offers repayment of the "secured portion" or fair market value of the collateral in their repayment plan.

1. If the earlier investors of the company don't pony up new cash for the next round of financing, then their interest in the company is "crammed down."

2. Creditors usually don't like this because they would rather liquidate the company's assets and get back some of the money owed to them.