Episode Summary When a company fails, who gets paid first, and how much do they actually recover? The priority order of claims is contractually set years before any trouble occurs, written into legal documents that dictate who is made whole and who receives nothing. This episode explores the corporate capital structure, how protective covenants safeguard lenders, and why "corporate bonds" are far from being a single, uniform asset class.

Key Concepts

• The Priority Queue: On the day of a corporate failure, assets are liquidated in a strict legal order: secured creditors first (those with claims on specific assets), followed by senior unsecured bonds, subordinated debt, preferred shares, and finally common shareholders at the very back of the line.
• Canadian Debenture ...