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Assignment For The Benefit Of Creditors
1. Introduction. Assignment made [date], by [name], a corporation organized and existing under the laws of [state], with principal place of business at [address] (Assignor), to [name], Esq., of the law firm of [name), with offices at [address] (Assignee).
2. Reason for Assignment. Assignor is unable to pay Assignor's debts in full as they come due and wishes to make a fair disposition of Assignor's assets among Assignor's creditors.
3. Authorization by Assignor's Board of Directors. At a special meeting of Assignor's Board of Directors held in accordance with Assignor's Bylaws on [date] at [address], a resolution was adopted authorizing Assignor's President to execute and deliver this Assignment to Assignee.
4. Assignment. Assignor assigns to Assignee all of Assignor's property, regardless of its nature or where it is located, in trust for the purposes described in Paragraph 5. A description of the property assigned is contained on Schedule A [omitted] annexed to this Assignment. Any omission of any of Assignor's properly from Schedule A is inadvertent, Assignor's intent being to assign all of Assignor's property to Assignee.
5. Assignee's Duties. Assignee's obligations with regard to the property assigned to him in trust are:
a. Take Possession and Reduce to Cash. To take possession of the property and convert it into cash as expeditiously as possible, including the collection of all debts owed to Assignor from Assignor's stockholders or others. In connection with the collection of debts, Assignee is authorized to compromise them if, in Assignee's judgment, this will result in the realization of the largest sum possible.
b. Pay Assignee's Commissions and Expenses. Out of the proceeds realized from the assigned property, to pay all expenses and costs incurred in the discharge of Assignee's responsibilities, including Assignee's commissions and allowances for Assignee's services.
c. Pay Preferred Debts. Following payment of the items described in Paragraph 5(b), to pay and discharge those claims that are entitled to a preference under the laws of [state], including employee's wage claims, applying the priorities provided by law.
d. Pay Remaining Debts. Following payment of the items described in Paragraphs 5(b) and 5(c), to pay and discharge all of Assignor's remaining debts due as of the date of this Assignment, including unmatured obligations, with any interest that is owed on them. If the fund held by Assignee is insufficient to discharge all of Assignor's remaining debts in full, the debts described in this Paragraph 5(d) shall be paid pro rata.
e. Following payment of the items described in Paragraphs 5(b), 5(c), and 5(d), to pay any remaining funds to Assignor, Assignor's successors or assigns.
6. Assignor's Power of Attorney. Together with the delivery to Assignee of this Assignment, Assignor will deliver to Assignee Assignor's power of attorney, properly executed, empowering Assignee to act for Assignor in all matters with respect to the discharge of Assignee's obligations under this Assignment.
Assignment accepted [date].
*** If Required By State Law ***
This Section for Notary:
STATE OF -------)
) ss: [date]
COUNTY OF ------)
On [Date] before me, [Name of Notary], notary, personally appeared [Name of Person(s) Involved], personally known to me (or proved to me on the basis of satisfactory evidence) to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
Witness my hand and official seal.
[Name of Notary Public]
My commission expires: [date]