Common use of Distribution Upon Termination Clause in Contracts

Distribution Upon Termination. Upon the dissolution and termination of the Company, the Managers shall take full account of the Company's assets and liabilities, the assets shall be liquidated as promptly as is consistent with obtaining fair value therefor, and the proceeds therefrom, to the extent sufficient therefor, shall be applied and distributed in the following order: (a) to the payment of all creditors, other than Members, in the order of priority as provided by the Act, except any claims of secured creditors whose obligations will be assumed or otherwise transferred on the liquidation of the Company's assets; (b) to the payment of any obligations of the Company to any Member; (c) to the establishment of any reserves which the Managers deem reasonably necessary for any contingencies or unforeseen liabilities or obligations of the Company. Such reserves shall be paid over by the Managers to an escrow agent or shall be held for the purpose of disbursing such reserves in payment of any of the said contingencies and, at the expiration of such period as the Managers shall deem advisable, the balance thereof shall be distributed in the manner and order provided in this Section 8.2; and (d) to the payment of all Members of their respective positive capital accounts (after taking into account all capital account adjustments under Section 10.3 of this Agreement during the taxable year such liquidation occurs other than any adjustments for the liquidating distributions hereunder), including Members who resigned and received less than the fair value of their Membership Interests at the time of their resignation.

Distribution Upon Termination. Upon the dissolution and termination of the Company, the Managers shall take full account of the Company's assets and liabilities, the assets shall be liquidated (subject to Section 10.4 hereof) as promptly as is consistent with obtaining fair value therefor, and the proceeds therefrom, to the extent sufficient therefor, shall be applied and distributed in the following order: (a) to the payment of all creditors, other than Members, in the order of priority as provided by the Act, except any claims of secured creditors whose obligations will be assumed or otherwise transferred on the liquidation of the Company's assets; (b) to the payment of any obligations of the Company to any Member; (c) to the establishment of any reserves which the Managers deem reasonably necessary for any contingencies or unforeseen liabilities or obligations of the Company. Such reserves shall be paid over by the Managers to an escrow agent or shall be held for the purpose of disbursing such reserves in payment of any of the said contingencies and, at the expiration of such period as the Managers shall deem advisable, the balance thereof shall be distributed in the manner and order provided in this Section 8.213.2; and (d) to the payment of all Members of their respective positive capital accounts (after taking into account all capital account adjustments under Section 10.3 of this Agreement during the taxable year such liquidation occurs other than any adjustments for the liquidating distributions hereunder), including Members who resigned and received less than the fair value of their Membership Interests at the time of their resignation.