Liquidation Rights Clause Samples
Liquidation Rights define the order and manner in which proceeds are distributed to stakeholders if a company is liquidated, sold, or undergoes a similar exit event. Typically, these rights specify that certain investors, such as preferred shareholders, are paid back their investment (sometimes with a premium) before any remaining funds are distributed to common shareholders. For example, in a startup acquisition, preferred investors may receive their original investment amount before founders or employees receive any payout. The core function of this clause is to protect investors by ensuring they recover their capital ahead of others, thereby allocating risk and clarifying payout priorities in the event of liquidation.
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Liquidation Rights. (a) The RVMTP Shares shall rank on parity with each other, with shares of any other Series of RVMTP Shares, and with shares of any other class or series of Preferred Shares (including the Auction Preferred Shares) as to distribution of assets upon dissolution, liquidation, or winding-up of the affairs of the Fund. In this regard, the provisions of this Section 2.3 shall be applied consistently with Section 11.3 of the Auction Preferred Statement and with all other Preferred Shares such that Holders of the RVMTP Shares and holders of the Auction Preferred Shares and any other Preferred Shares are treated on parity with one another with respect to any such distribution.
(b) In the event of any liquidation, dissolution or winding up of the affairs of the Fund, whether voluntary or involuntary, the Holders of RVMTP Shares shall be entitled to receive out of the assets of the Fund available for distribution to shareholders, after satisfying claims of creditors but before any distribution or payment shall be made in respect of the Common Shares, a liquidation distribution equal to the Liquidation Preference for such shares, plus an amount equal to all unpaid dividends and other distributions on such shares accumulated to (but excluding) the date fixed for such distribution or payment on such shares (whether or not earned or declared by the Fund, but without interest thereon), and such Holders shall be entitled to no further participation in any distribution or payment in connection with any such liquidation, dissolution or winding up.
(c) If, upon any liquidation, dissolution or winding up of the affairs of the Fund, whether voluntary or involuntary, the assets of the Fund available for distribution among the Holders of all Outstanding RVMTP Shares and any other outstanding Preferred Shares ranking on a parity with the RVMTP Shares (including, without limitation, the Auction Preferred Shares) shall be insufficient to permit the payment in full to such Holders of the Liquidation Preference of such RVMTP Shares plus accumulated and unpaid dividends and other distributions on such shares as provided in Section 2.3(b) above and the amounts due upon liquidation with respect to such other Preferred Shares, then such available assets shall be distributed among the Holders of such RVMTP Shares and such other Preferred Shares ratably in proportion to the respective preferential liquidation amounts to which they are entitled. In connection with any liquidation, dissolutio...
Liquidation Rights. (1) Upon the voluntary or involuntary dissolution, liquidation or winding up of the Partnership, the General Partner, in its capacity as the holder of the Series D Preferred Partnership Units then outstanding, shall be entitled to receive and to be paid out of the assets of the Partnership available for distribution to its partners, before any payment or distribution shall be made on any Junior Partnership Units, the amount of $250.00 per Series D Preferred Partnership Unit, plus accrued and unpaid quarterly distributions thereon.
(2) After the payment to the holders of the Series D Preferred Partnership Units of the full preferential amounts provided for herein, the General Partner, in its capacity as the holder of the Series D Preferred Partnership Units as such, shall have no right or claim to any of the remaining assets of the Partnership.
(3) If, upon any voluntary or involuntary dissolution, liquidation, or winding up of the Partnership, the amounts payable with respect to the preference value of the Series D Preferred Partnership Units and any other Preferred Partnership Units of the Partnership ranking as to any such distribution on a parity with the Series D Preferred Partnership Units are not paid in full, the holders of the Series D Preferred Partnership Units and of such other Preferred Partnership Units will share ratably in any such distribution of assets of the Partnership in proportion to the full respective preference amounts to which they are entitled.
(4) Neither the sale, lease or conveyance of all or substantially all of the property or business of the Partnership, nor the merger or consolidation of the Partnership into or with any other entity or the merger or consolidation of any other entity into or with the Partnership, shall be deemed to be a dissolution, liquidation or winding up, voluntary or involuntary, for the purposes hereof.
Liquidation Rights. (a) In the event of any voluntary or involuntary liquidation, dissolution or winding-up of the Company, or its subsidiaries the assets of which constitute all or substantially all of the assets of the Company and its subsidiaries taken as a whole, in either case in a single or series of transactions by merger or otherwise (each a “Liquidation Event”), subject to the payment or provision for payment of the debts and other liabilities of the Company, each Holder shall be entitled to receive and to be paid out of the remaining assets and funds of the Company available for distribution to its stockholders, prior to the holders of Junior Stock an amount for each share of Preferred Stock then held by such Holder equal to the greater of (a) the Accreted Value plus accrued and unpaid dividends as of the date of such Liquidation Event and (b) the amount that such Holder would have received if, immediately prior to such Liquidation Event, it had voluntarily converted its Preferred Stock pursuant to Section 6. For purposes hereof, any sale, conveyance, exchange or transfer (for cash, shares of stock, securities or other consideration) of all or substantially all the assets or business of the Company and its subsidiaries, or the merger or consolidation of the Company and/or its subsidiaries into or with any other Person, in each case, that would constitute a Change of Control, shall be deemed a “Liquidation Event”.
(b) If any Liquidation Event occurs prior to the fifth anniversary of the Issue Date, each Holder shall be entitled to receive and to be paid out of the remaining assets and funds of the Company available for distribution to its stockholders, prior to the holders of Junior Stock, an amount for each share of Preferred Stock then held by such Holder equal to the greater of (a) 105% of the Accreted Value plus accrued and unpaid dividends as of the date of such transaction and (b) the amount that such Holder would have received if, immediately prior to such transaction, it had voluntarily converted its Preferred Stock pursuant to Section 6.
(c) After the indefeasible payment in cash to the Holders of full preferential amounts provided for in this Section 5, Holders as such shall have no right or claim to any of the remaining assets or funds of the Company.
(d) In the event the assets and funds of the Company available for distribution to Holders upon any Liquidation Event shall be insufficient to pay in full all amounts to which such Holders are entitled pursua...
Liquidation Rights. (a) Upon any Dissolution Event, after payment or provision for the liabilities of the Partnership (including the expenses of such Dissolution Event) and the satisfaction of all claims ranking senior to the Series A Preferred Mirror Units in accordance with Article IX of this Agreement, the Series A Holders shall be entitled to receive out of the assets of the Partnership or proceeds thereof available for distribution to Partners, before any payment or distribution of assets is made in respect of Junior Units, distributions equal to the lesser of (x) the Series A Liquidation Value and (y) the positive balance in their Capital Accounts (to the extent such positive balance is attributable to ownership of the Series A Preferred Mirror Units and after taking into account allocations of Gross Ordinary Income to the Series A Holders pursuant to Section 5.5(d) of this Agreement for the taxable year in which the Dissolution Event occurs). Upon a Dissolution Event, or in the event that any Ares Operating Group entity liquidates, dissolves or winds up, no Ares Operating Group entity may declare or pay or set apart payment on its Junior Units unless the outstanding liquidation preference on all outstanding GP Mirror Units of each Ares Operating Group entity have been repaid via redemption or otherwise.
(b) Upon a Dissolution Event, after each Series A Holder receives a payment equal to the positive balance in its Capital Account (to the extent such positive balance is attributable to ownership of the Series A Preferred Mirror Units and after taking into account allocations of Gross Ordinary Income to the Series A Holders pursuant to Section 5.5(d) of this Agreement for the taxable year in which the Dissolution Event occurs), such Series A Holder shall not be entitled to any further participation in any distribution of assets by the Partnership.
(c) For the purposes of this Section 12.8, a Dissolution Event shall not be deemed to have occurred in connection with (i) a Substantially All Merger or a Substantially All Sale whereby an Ares Operating Group entity is the surviving Person or the Person formed by such transaction is organized under the laws of a Permitted Jurisdiction and has expressly assumed all of the obligations under the GP Mirror Units, (ii) the sale or disposition of an Ares Operating Group entity (whether by merger, consolidation or the sale of all or substantially all of its assets) if such sale or disposition is not a Substantially All Merger or Subs...
Liquidation Rights. (a) As to rights upon any Liquidation or an Event of Sale, each share of Series A-1 Stock shall rank equally with each other share of Series A-1 Stock and senior to all shares of Series A-2 Stock, Series A-3 Stock, Series A-4 Stock, Series A-5 Stock and Series A-6 Stock; each share of Series A-2 Stock shall rank equally with each other share of Series A-2 Stock and senior to all shares of Series A-3 Stock, Series A-4 Stock, Series A-5 Stock and Series A-6 Stock; each share of Series A-3 Stock, Series A-5 Stock and Series A-6 Stock shall rank equally with each other share of Series A-3 Stock, Series A-5 and Series A-6 Stock and senior to all shares of Series A-4 Stock and shares of Common Stock and all other classes or series of stock not authorized by this Certificate as of the Effective Time, except as otherwise approved by the affirmative vote or consent of the New Senior Majority. Each share of Series A-4 Stock, shall rank equally with each other share of Series A-4 Stock and senior to all shares of Common Stock and all other classes or series of stock not authorized by this Certificate as of the Effective Time, except as otherwise approved by the affirmative vote or consent of the New Senior Majority.
(b) In the event of any liquidation, dissolution or winding-up of the affairs of the Corporation (collectively, a “Liquidation”): (i) the holders of shares of Series A-1 Stock then outstanding (the “Series A-1 Stockholders”) shall be entitled to receive, ratably with each other, out of the assets of the Corporation legally available for distribution to its stockholders, whether from capital, surplus or earnings, before any payment shall be made to the holders of Series A-2 Stock then outstanding (the “Series A-2 Stockholders”), Series A-3 Stock then outstanding (the “Series A-3 Stockholders”), Series A-4 Stock then outstanding (the “Series A-4 Stockholders”), Series A-5 Stock then outstanding (the “Series A-5 Stockholders”) or Series A-6 Stock then outstanding (the “Series A-6 Stockholders” and collectively with the Series A-1 Stockholders, Series A-2 Stockholders, Series A-3 Stockholders, Series A-4 Stockholders and the Series A-5 Stockholders, the “New Preferred Stockholders”), or the holders of Common Stock or any other class or series of stock ranking on Liquidation junior to such Series A-1 Stock, an amount per share equal to the Series A-1 Original Purchase Price (as defined in Section B.8 hereof), plus an amount equal to any declared or accrued but...
Liquidation Rights. Upon the liquidation, dissolution or winding up of the Corporation, or the occurrence of a Liquidation Transaction, the assets of the Corporation shall be distributed as provided in Section 2 of Article IV(B).
Liquidation Rights. 4.1 In the event of any liquidation, winding-up or dissolution of the Company, whether voluntary or involuntary, each Holder shall be entitled to receive, in respect of each share of Preferred Stock, and to be paid out of the assets of the Company available for distribution to its stockholders, in preference to the holders of, and before any payment or distribution is made on, any Junior Stock, an amount equal to the greater of (i) the Liquidation Preference plus the Accumulated Cash Dividends, and (ii) the sum of (A) the product of the Exchange Rate multiplied by the Market Value as of the effective date of such liquidation, winding up or dissolution plus (B) the Accumulated Cash Dividends thereon.
4.2 In the event of any liquidation, winding-up or dissolution of the Parent, whether voluntary or involuntary, each Holder shall be entitled to receive, in respect of such shares of Preferred Stock, and to be paid out of the assets of the Company available for distribution to its stockholders, in preference to the holders of, and before any payment or distribution is made on, any Junior Stock, an amount equal to the greater of (i) the Liquidation Preference plus the Accumulated Cash Dividends thereon and (ii) the amount such Holder would have received had such Holder, immediately prior to such liquidation, winding-up or dissolution of the Parent, exchanged such Preferred Stock for Parent Common Shares in accordance with Section 5.1. Such payment shall be made regardless of whether there is a liquidation, winding-up or dissolution of the Company.
4.3 Neither the sale, conveyance, exchange or transfer (for cash, shares of stock, securities or other consideration) of all or substantially all the assets or business of the Company (other than in connection with the liquidation, winding up or dissolution of its business), nor the merger or consolidation of the Company into or with any other Person shall be deemed to be a liquidation, winding-up or dissolution, voluntary or involuntary, for the purposes of this Section 4.
4.4 After the payment in full to the Holders of the amounts provided for in this Section 4, the Holders of shares of Preferred Stock as such shall have no right or claim to any of the remaining assets of the Company in respect of their ownership of such Preferred Stock.
4.5 In the event the assets of the Company available for distribution to the Holders upon any liquidation, winding-up or dissolution of the Company, whether voluntary or involuntary,...
Liquidation Rights. Upon the liquidation, dissolution or winding up of the Corporation, whether voluntary or involuntary, no distribution shall be made (1) to the holders of shares of stock ranking junior (either as to dividends or upon liquidation, dissolution or winding up) to the Series A Preferred Stock unless, prior thereto, the holders of shares of Series A Preferred Stock shall have received an amount equal to the accrued and unpaid dividends and distributions thereon, whether or not declared, to the date of such payment, plus an amount equal to the greater of (x) $.01 per whole share or (y) an aggregate amount per share equal to the Formula Number then in effect times the aggregate amount to be distributed per share to holders of Common Stock or (2) to the holders of stock ranking on a parity (either as to dividends or upon liquidation, dissolution or winding up) with the Series A Preferred Stock, except distributions made ratably on the Series A Preferred Stock and all other such parity stock in proportion to the total amounts to which the holders of all such shares are entitled upon such liquidation, dissolution or winding up.
Liquidation Rights. (a) Upon any liquidation, dissolution, or winding up of the Company, whether voluntary or involuntary, before any distribution or payment shall be made to the holders of Common Stock, subject to the rights of any series of Preferred Stock that may from time to time come into existence, the holders of Series A Preferred, Series B Preferred and Series C Preferred shall be entitled to be paid out of the assets of the Company an amount per share of Series A Preferred, Series B Preferred and Series C Preferred, respectively, equal to their respective Original Issue Price plus all declared and unpaid dividends on the Series A Preferred, Series B Preferred and Series C Preferred, respectively (as adjusted for any stock dividends, combinations, splits, recapitalizations and the like with respect to such shares) for each share of Series A Preferred, Series B Preferred and Series C Preferred held by them. If, upon any such liquidation, distribution, or winding up, the assets of the Company shall be insufficient to make payment in full to all holders of Series A Preferred, Series B Preferred and Series C Preferred of the liquidation preference set forth in this Section 3(a), subject to the rights of any series of Preferred Stock that may from time to time come into existence, then such assets shall be distributed among the holders of Series A Preferred, Series B Preferred and Series C Preferred at the time outstanding, ratably in proportion to the full amounts to which they would otherwise be respectively entitled.
(b) After the payment of the full liquidation preference of the Series A Preferred, Series B Preferred and Series C Preferred as set forth in Section 3(a) above, and any other distribution that may be required with respect to any series of Preferred Stock that may from time to time come into existence, the remaining assets of the Company legally available for distribution, if any, shall be distributed ratably to the holders of the Common Stock.
(c) The following events shall be considered a liquidation under this Section:
(i) any consolidation or merger of the Company with or into any other corporation or other entity or person in which the stockholders of the Company immediately prior to such consolidation or merger own less than 50% of the Company's voting power immediately after such consolidation or merger, excluding any consolidation or merger effected exclusively to change the domicile of the Company (an "Acquisition"); or
(ii) a sale of all or subst...
Liquidation Rights. (a) Upon the occurrence of any Liquidation Event, Series A Holders shall be entitled to receive out of the assets of the Partnership or proceeds thereof legally available for distribution to the Partners, (i) after satisfaction of all liabilities, if any, to creditors of the Partnership, (ii) after all applicable distributions of such assets or proceeds being made to or set aside for the holders of any Senior Securities then Outstanding in respect of such Liquidation Event, (iii) concurrently with any applicable distributions of such assets or proceeds being made to or set aside for holders of any Series A Preference Units or other Parity Securities then Outstanding in respect of such Liquidation Event and (iv) before any distribution of such assets or proceeds is made to or set aside for the holders of Common Units and any other classes or series of Junior Securities as to such distribution, a liquidating distribution or payment in full redemption of such Series A Preference Units in an amount equal to the Series A Liquidation Preference. For purposes of clarity, upon the occurrence of any Liquidation Event, (x) the holders of then Outstanding Senior Securities shall be entitled to receive the applicable Liquidation Preference on such Senior Securities before any distribution shall be made with respect to the Series A Preference Units or any Parity Securities and (y) the Series A Holders shall be entitled to the Series A Liquidation Preference per Series A Preference Unit in cash, concurrently with any distribution made to the holders of any Parity Securities and before any distribution shall be made to the holders of Common Units or any other Junior Securities. Series A Holders shall not be entitled to any other amounts from the Partnership, in their capacity as Series A Holders, after they have received the Series A Liquidation Preference. The payment of the Series A Liquidation Preference shall be a payment in redemption of the Series A Preference Units such that, from and after payment of the full Series A Liquidation Preference, any such Series A Preference Unit shall thereafter be cancelled and no longer be Outstanding.
(b) If, in the event of any distribution or payment described in Section 16.4(a) above where the Partnership’s assets available for distribution to holders of the Outstanding Series A Preference Units and any other Parity Securities are insufficient to satisfy the applicable Liquidation Preference for such Series A Preference Units a...