LIQUIDATING DISTRIBUTION AND TERMINATION Clause Samples
The "Liquidating Distribution and Termination" clause outlines the process for distributing a company's remaining assets to its stakeholders and formally ending its existence. Typically, this clause specifies the order in which creditors, shareholders, or partners receive payments or property once all debts and obligations have been settled. For example, it may require that outstanding liabilities are paid first, with any surplus divided among owners according to their ownership interests. The core function of this clause is to ensure an orderly and fair winding up of the business, providing clear guidance on asset distribution and preventing disputes during the termination process.
LIQUIDATING DISTRIBUTION AND TERMINATION. 4.1 Immediately after the Effective Time, Intermediate-Term Bond shall distribute in the complete liquidation pro rata to the record holders of its shares at the Effective Time the shares of Diversified Bond to be received by the record holders of Intermediate-Term Bond. In accordance with instructions it receives from ACMR, ACIT shall record on its books the ownership of shares of Diversified Bond by the record holders of shares of Intermediate-Term Bond. All of the issued and outstanding shares of Intermediate-Term Bond shall be redeemed and canceled on the books of ACMF at the Effective Time and shall thereafter represent only the right to receive the shares of Diversified Bond, and Intermediate-Term Bond's transfer books shall be closed permanently. As soon as practicable after the Effective Time, ACMF shall take all steps as shall be necessary and proper to effect the dissolution of Intermediate-Term Bond under federal and state law. After the Effective Time, ACMF shall not conduct any business with respect to Intermediate-Term Bond except in connection with Intermediate-Term Bond's liquidation and dissolution.
4.2 Immediately after the Effective Time, Bond shall distribute in the complete liquidation pro rata to the record holders of its shares at the Effective Time the shares of Diversified Bond to be received by the record holders of Bond. In accordance with instructions it receives from ACMF, ACIT shall record on its books the ownership of shares of Diversified Bond by the record holders of shares of Bond. All of the issued and outstanding shares of Bond shall be redeemed and canceled on the books of ACMF at the Effective Time and shall thereafter represent only the right to receive the shares of Diversified Bond, and Bond's transfer books shall be closed permanently. As soon as practicable after the Effective Time, ACMF shall take all steps as shall be necessary and proper to effect the dissolution of Bond under federal and state law. After the Effective Time, ACMF shall not conduct any business with respect to Bond except in connection with Bond's liquidation and dissolution.
4.3 Immediately after the Effective Time, Premium Bond shall distribute in the complete liquidation pro rata to the record holders of its shares at the Effective Time the shares of Diversified Bond to be received by the record holders of Premium Bond. In accordance with instructions it receives from ACPR, ACIT shall record on its books the ownership of shares of Diversified...
LIQUIDATING DISTRIBUTION AND TERMINATION of Bond 6. Liquidating Distribution and Termination of Premium Bond 7. Valuation Time........................................................3 8. Certain Representations, Warranties and Agreements of ACMF............