A bondholder of an insolvent corporation is entitled to payment from proceeds before general creditors, if secured, and before shareholders.

Name: A bondholder of an insolvent corporation is entitled to payment from proceeds before general creditors, if secured, and before shareholders.
Brand: Quizplus
Rating: 4.9 (49 reviews)

Question

Quizplus · Accepted Answer

This is known as the priority of claim in a liquidation process. Secured bondholders have a higher priority than general creditors, and both have a higher priority than shareholders.

A Bondholder of an Insolvent Corporation Is Entitled to Payment