Pari-passu is a Latin phrase meaning "equal footing." In finance, "equal footing" means that two or more parties to a financial contract or claim are all treated the same. Pari-passu is common in bankruptcy proceedings as well as debts such as parity bonds in which each party gets the same amount.
How do you use pari passu in a sentence?
used in legal language.
- There three cars made a pari passu advance.
- Inflation and interest rates are increasing pari passu.
- Liberty and law advance pari passu.
- The new share will rank pari passu with the existing one.
- All the new shares rank pari passu with the existing shares in all respects.
Are pro rata and pari passu the same?
Pari passu refers to a class, such as a group of creditors in a bankruptcy proceeding. If something is held pari passu, its obligations will be the same class and priority -- or, on equal footing. Pro rata, a Latin term for in proportion, essentially means that everyone gets their fair share in proportion to the whole.
