Senior Issue
An issue of bonds, preferred stock or other securities that represents the first priority lien on the issuer's assets or earnings. Senior issues have a higher priority claim on a firm's dividends, interest payments or, in case of a bankruptcy, the value salvaged from a liquidation. Investopedia Says:
Priority levels may change in the subordinated debt structure. An issue that is considered senior may lose that title in certain situations. For example, if a firm claims bankruptcy and begins acting as a debtor-in-possession, it may attempt to raise more funds to keep operations going. A new lender may require its lien to be given top priority, forcing the current senior issue of bonds down the claims ladder. Related Terms:
Absolute Priority
Debtor in Possession - DIP
Debtor-in-Possession Financing - DIP Financing
Junior Issue
Junior Security
Senior Security
Subordinated Debt |