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Liquidation rights

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Definition of Liquidation rights

Liquidation Rights Image 1

Liquidation rights

The rights of a firm's securityholders in the event the firm liquidates.



Related Terms:

Appraisal rights

A right of shareholders in a merger to demand the payment of a fair price for their shares, as
determined independently.


Cum rights

With rights.


Dividend rights

A shareholders' rights to receive per-share dividends identical to those other shareholders receive.


Ex-rights

In connection with a rights offering, shares of stock that are trading without the rights attached.


Ex-rights date

The date on which a share of common stock begins trading ex-rights.



Involuntary liquidation preference

A premium that must be paid to preferred or preference stockholders if
the issuer of the stock is forced into involuntary liquidation.


LIFO Liquidation

A reduction in the physical quantity of an inventory that is accounted for
using the LIFO inventory method.


Liquidation Rights Image 2

Liquidation

When a firm's business is terminated, assets are sold, proceeds pay creditors and any leftovers
are distributed to shareholders. Any transaction that offsets or closes out a Long or short position. Related:
buy in, evening up, offsetliquidity.


Liquidation

The process of selling off all the assets of a business entity, settling its liabilities,
and closing it down as a legal entity.


liquidation

Sale of bankrupt firm’s assets.


Liquidation value

Net amount that could be realized by selling the assets of a firm after paying the debt.


Liquidation Value

The net proceeds (after taxes and expenses) of selling the assets
of a company at fair market prices


liquidation value

Net proceeds that would be realized by selling the firm’s assets and paying off its creditors.


Property rights

rights of individuals and companies to own and utilize property as they see fit and to receive
the stream of income that their property generates.


rights issue

Issue of securities offered only to current stockholders.


Rights offering

Issuance of "rights" to current shareholders allowing them to purchase additional shares,
usually at a discount to market price. Shareholders who do not exercise these rights are usually diluted by the
offering. rights are often transferable, allowing the holder to sell them on the open market to others who may
wish to exercise them. rights offerings are particularly common to closed end funds, which cannot otherwise
issue additional common stock.


Liquidation Rights Image 3

Rights-on

Shares trading with rights attached to them.


Special drawing rights (SDR)

A form of international reserve assets, created by the IMF in 1967, whose
value is based on a portfolio of widely used currencies.



Uniformed Services Employment and Reemployment Rights Act of 1994

A federal act that minimizes the impact on people serving in the Armed Forces
when they return to civilian employment by avoiding discrimination and increasing
their employment opportunities.


Voting rights

The right to vote on matters that are put to a vote of security holders. For example the right to
vote for directors.


With rights

Purchase of shares in which the buyer is entitled to the rights to buy shares in the company's
rights issue.


Preferred stock

A security that shows ownership in a corporation and gives the holder a claim, prior to the
claim of common stockholders, on earnings and also generally on assets in the event of liquidation. Most
preferred stock pays a fixed dividend that is paid prior to the common stock dividend, stated in a dollar
amount or as a percentage of par value. This stock does not usually carry voting rights. The stock shares
characteristics of both common stock and debt.


Preferred stock

A type of stock that usually pays a fixed dividend prior to any distributions
to the holders of common stock. In the event of liquidation, it must be paid
off before common stock. It can, but rarely does, have voting rights.



 

 

 

 

 

 

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