easy · Debt Capital Markets bond-instruments-structures

Where does PIK debt typically sit in the capital stack relative to senior secured loans?

1. It ranks pari passu with senior secured bank debt.
2. It is senior to all other debt and has first priority on assets.
3. It is considered a form of common equity and has no claim on assets.
4. It is structurally and contractually subordinated to senior secured debt.

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