The process of liquidation is when the company is wound up by a liquidator.
The company is turned into liquid asset - cash.
The assets are sold and then paid to the creditors in a specific order.
The liquidator will pay each category in full before moving on to the next.
There is normally insufficient funds to pay all the creditors

Priority on Liquidation

The liquidators fees 
Fixed charge holders 
Preferential Creditors 
Floating charge holders 
Unsecured Creditors 
Subordinated creditors 
Preference Shareholders 
Ordinary Shareholders 

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