Exchange Right Upon Dissolution Sample Clauses
The Exchange Right Upon Dissolution clause grants certain parties the ability to exchange their interests or shares for another form of consideration if the entity is dissolved. In practice, this means that upon the winding up or termination of the company, holders of specific rights—such as preferred shareholders or convertible note holders—may convert their holdings into cash, common shares, or other assets as specified in the agreement. This clause ensures that stakeholders have a clear and predetermined method for realizing value from their investment in the event of dissolution, thereby reducing uncertainty and potential disputes over asset distribution.
Exchange Right Upon Dissolution. (a) Upon the occurrence of an event described in Section 7.1(a), if (i) New Mountain Finance is not the sole Member at the time of such event and (ii) prior to or concurrent with the occurrence of such event, New Mountain Finance has adopted a plan relating to the liquidation or dissolution of New Mountain Finance, then New Mountain Finance shall have the right to acquire from any Non-NMF Member all (but not less than all) of the Common Membership Units held by such Non-NMF Member in exchange for shares of New Mountain Finance Common Stock on a one-for-one basis (the “Dissolution Exchange Right”). If New Mountain Finance desires to exercise its Dissolution Exchange Right with respect to a Non-NMF Member, it shall exercise such right by giving written notice (the “Dissolution Exchange Notice”) to such Non-NMF Member (the “Dissolution Exchanging Non-NMF Member”) with a copy to the Company. The Dissolution Exchange Notice shall specify a date, which is to be as soon as reasonable following the occurrence of the event triggering the Dissolution Exchange Right, but in any event shall be prior to commencement of application of the assets of the Company pursuant to Section 7.3(a)(ii), on which the exercise of the Dissolution Exchange Right shall be completed (the “Dissolution Exchange Date”).