QHC Litigation Trust Sample Clauses

QHC Litigation Trust. On the Effective Date, a litigation trust (the “QHC Litigation Trust” or “Trust”) will be established for the benefit of Holders of Senior Notes Claims (the “Noteholders”) in connection with the Debtors’ Joint Prepackaged Chapter 11 Plan of Reorganization (the “Plan”).1 The Trust will be governed by a litigation trust agreement (the “QHC Litigation Trust Agreement”). The following term sheet (“Term Sheet”) contains the proposed, material terms relating to the QHC Litigation Trust Agreement. This Term Sheet is not legally binding, is not a complete list of all terms and conditions relating to the QHC Litigation Trust Agreement and is subject to change. Trust Purpose The primary purpose of the Trust is to maximize the QHC Litigation Trust Assets to the greatest extent possible for the benefit of the Trust beneficiaries. Financing All funding for the trust shall be borne by Contributing Noteholders. There shall be no funding provided by the Debtors or Reorganized Debtors. The initial trust funding amount (the “Initial Funding”) shall be determined by the Trust Board (as defined herein). Each Noteholder shall have the opportunity to fund its pro rata portion of the Initial Funding (the “Initial Pro Rata Allocation”). If any Noteholder declines to fund its Initial Pro Rata Allocation, the other Noteholders shall be entitled to fund the unfunded portion on terms to be determined by the Trust in an amount equal to their pro rata interest in the unfunded amount, which shall be calculated based only on the holdings of the Noteholders that fund their Initial Pro Rata Allocation and elect to fund the unfunded amount. The amounts funded by the Initial Pro Rata Allocations shall be paid back in full by the Trust before any other Trust distributions may be made to Noteholders; provided that the Initial Funding shall be entitled to preferred return on terms approved by the Trust Board and noticed to all Noteholders in connection with the Initial Funding requests. The Trust Board Members (as defined herein) shall be authorized to seek supplemental or alternative funding for the Trust in the event that the Noteholders do not fund their respective Initial Pro Rata Allocation, or if the Trust Board Members determine at any time that additional funding is necessary. The Initial Funding shall occur no later than September 30, 2020, at which time the Trust shall begin its investigation of, and prepare to pursue, if determined by the Trust Board to be appropriate, the QHC Litiga...