SIE: 1.3.2.4. Right To A Residual Claim During Liquidation

Taken from our SIE Online Guide

1.3.2.4.  Right to a Residual Claim During Liquidation

If a company is forced to liquidate due to bankruptcy, common stockholders have a residual claim to corporate assets after all debt obligations have been satisfied. This means that common stockholders are at the bottom of the list of claims on the corporation. They are paid only after bondholders and preferred stockholders have been paid.

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