liquidation definition

liquidation

Winding up of a firm by selling off its free (un-pledged) assets to convert them into cash to pay the firm's unsecured creditors. (The secured creditors take control of the respective pledged assets on obtaining foreclosure orders). Any remaining amount is distributed among the shareholders in proportion to their shareholdings. Liquidation process is initiated either by the shareholders (voluntary liquidation) or by the creditors after obtaining court's permission (compulsory liquidation).

liquidation is in the Accounting & Auditing, Banking, Commerce & Finance and Corporate, Commercial, & General Law subjects.

liquidation appears in the definitions of the following terms: winding up, secured party, sale and buyback, debt restructuring, secured lender, preferred stock, junior security, tax lien, collateral value, members' voluntary liquidation and

liquidation appears in these other terms: orderly liquidation value, creditors' voluntary liquidation, voluntary liquidation, liquidation value, forced liquidation, orderly liquidation, compulsory liquidation

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