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The order of repayment. In the event of bankruptcy, senior debt must be repaid before subordinated debt is repaid.
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.

Absolute Priority

A rule stating that, in liquidation, certain creditors must be satisfied in full before any other creditors receive any payments. That is, in the liquidation of a company, the absolute priority rule states that holders of secured debt must be paid before holders of unsecured debt. Holders of unsecured debt have precedence over preferred shareholders, and, finally, preferred shareholders must be satisfied before common shareholders.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved


The condition or status of a security that has priority over other securities by the same issuer with respect to the payment of income (that is, interest or dividends) and repayment of principal. As an example, for the same issuer, bonds have seniority over preferred stock and preferred stock has priority over common stock. See also junior security.
Wall Street Words: An A to Z Guide to Investment Terms for Today's Investor by David L. Scott. Copyright © 2003 by Houghton Mifflin Company. Published by Houghton Mifflin Company. All rights reserved. All rights reserved.
References in periodicals archive ?
It was their case that since they had entered the Office upon taking oath on February 19, their seniority should be reckoned from such date and that of Justice Irfan from February 20.
However, the seniority of powerful bureaucrats, including the principal secretary to the prime minister, may be affected if the SC order is implemented as inclusion of the officers whose seniority was restored by the apex court may reduce his seniority.
Ragosta said it is Davies' educational policy to subordinate teacher seniority to merit-based factors in all its staffing decisions.
'This raises legitimate concern that while dispensing with seniority, the power to elevate judges in the SC might be subjected to arbitrariness and favouritism.
Seniority was launched in 1997 as a wholly-owned subsidiary of ABHOW, American Baptist Homes of the West, which is part of Cornerstone Affiliates.
The four-year-old has seen plenty of racing with 37 outings under his belt so far and with eight wins on his record, Classic Seniority is far from a back-number and now sits on a career-high rating of 90.
"My sole intention throughout this whole process was to regain my seniority - a seniority that took me 60 years of hard work to achieve.
....US$10000M Multiple Seniority Bank Note Program, Affirmed (P)A3
A five-member bench of Chief Justice Tasadduq Hussain Jillani resumed the hearing of a plea on the seniority case of a Lahore High Court (LHC) judge.
25 based on claims their seniority was unfairly stripped when the two airlines merged in 2010.
Perhaps those were times of great political elation for Nawaz Sharif, what with his heavy mandate, and he did not care much about such things as 'seniority' in the services and the need for application of the 'seniority principle' regarding appointment of service chiefs.
Finland is contesting the wording of an agreement struck last week in Brussels, arguing it doesn't adequately address the possibility that loans to Spain from Europe's permanent rescue fund can give taxpayers seniority. A June 29 statement from the 17 euro-area leaders stripping the European Stability Mechanism of its preferred creditor status in Spain was incomplete, said Martti Salmi, a Finnish Finance Ministry official.