Money & WorkHow it works
How the money of a bankrupt company gets divided.
First, assets that never belonged to the firm are separated out. Then secured creditors take from their collateral. Procedural costs and estate liabilities follow, then ordinary insolvency creditors at an equal quota, and finally subordinated claims.
Useful: As a normal customer or supplier you sit far back in that queue – which is why prepayments are a real risk.
Source: de.wikipedia.org