Crown paper liquidating trust

By establishing a liquidating trust pursuant to section 1123(b)(3) in a confirmed plan of reorganization or liquidation, a debtor can transfer causes of action and other assets to a trust, for future liquidation and distribution to the debtor’s creditors, and avoid delaying plan confirmation.The creditors become the trust beneficiaries and their claims are paid from trust assets by a waterfall established pursuant to the plan.Greater transparency and improved trust will mean honest entrepreneurs and investors can do business more securely in the UK and not be disadvantaged by those who don’t play by the rules.The first part of the paper looks to inject greater transparency around who really owns and controls companies in the UK.

The liquidating distribution value, which represents the Board’s estimate of the amount per beneficial interest to be distributed in total over the lifetime of the Liquidating Trust, was determined based on the net asset value of Crossroads Capital as of March 31, 2017 adjusted for expenses and events materially affecting the fair market value of the portfolio investments, if any.The paper sets out how the UK will implement its G8 commitment to a central registry of companies’ beneficial owners.In addition it proposes the abolition of bearer shares and measures to tackle misuse of corporate directors and nominee directors.In conjunction with the other provisions of the Bankruptcy Code that require a disclosure statement and plan to provide “adequate information” for a claim or interest holder to make an informed judgment about the plan, Section 1123(b)(3) effectively provides notice to creditors of retention and prospective enforcement of claims that may enlarge the estate’s assets for distribution.A plan must expressly retain claims to preserve a liquidating trust’s standing to pursue them after plan confirmation. Section 7A allowed the Secretary of State of Canada to issue letters patent for the creation of corporations without pecuniary gain and with "objects of a national, patriotic, religious, philanthropic, charitable, scientific, artistic, social, professional or sporting character, or the like." that did not apply to such a corporation.


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