liquidation

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Related to Compulsory liquidation: Winding Up Order

Liquidation

The collection of assets belonging to a debtor to be applied to the discharge of his or her outstanding debts.

A type of proceeding pursuant to federal Bankruptcy law by which certain property of a debtor is taken into custody by a trustee to be sold, the proceeds to be distributed to the debtor's creditors in satisfaction of their claims.

The settlement of the financial affairs of a business or individual through the sale of all assets and the distribution of the proceeds to creditors, heirs, or other parties with a legal claim.

The liquidation of a corporation is not the same as its dissolution (the termination of its existence as a legal entity). Depending upon statute, liquidation can precede or follow dissolution.

When a corporation undergoes liquidation, the money received by stockholders in lieu of their stock is usually treated as a sale or exchange of the stock resulting in its treatment as a capital gain or loss for Income Tax purposes.

See: aberemurder, assassination, cancellation, composition, discharge, dispatch, dissolution, homicide, killing, murder, payment, termination

liquidation

the procedure under which a company is dissolved (or wound up). Liquidation maybe voluntary (where the company is solvent but where the purposes for which it was set up have been achieved or no longer exist) or compulsory (usually where the company is insolvent). The function of a liquidator is to convert the assets of the company into cash, which is then distributed among the creditors to pay off (so far as possible) the debts of the company. Any surplus is then distributed among the members.

LIQUIDATION. A fixed and determinate valuation of things which before were uncertain.

References in periodicals archive ?
Mr Thomas added, "Forcing a company into compulsory liquidation should be the last resort.
A spokesman for The Official Receiver said: 'The firm has been placed into compulsory liquidation.
A company record obtained from Companies House lists Mr Foster, 50, as the director of Ulva Limited, which went into compulsory liquidation in 2007.
According to Experian, compulsory liquidation across the UK has continued to rise, up 4.
The company was put into compulsory liquidation by Birmingham District Registry on the petition of a creditor owed more than pounds 9,000.
The company was placed into compulsory liquidation in December 2001 under the application of the joint administrators, with a cash deficiency of pounds 1,314,287.
A statement released by the Official Receiver said they may examine a director of a company in compulsory liquidation in open court before a judge and under oath.
Application submitted for Commencement of Compulsory Liquidation Proceedings by Yamaichi Tochi Kabushiki Kaisha and Sanryou Estate Kabushiki Kaisha; Eventual Possibility of Credit Losses Mitsubishi Tokyo Financial Group, Inc.
It was never made and the company behind it, Warlord Productions Limited, was put into compulsory liquidation in the public interest.
Contract award: concession services assessment and collection also compulsory liquidation of ici, imu, tarsu, tares, icp, tosap and dpa.
He also highlighted a rise in the number of creditors forcing companies into compulsory liquidation due to bad debt.
Compulsory liquidation is when the court makes an order for the company to be wound up on the petition of an appropriate person - the director(s) of the company or a creditor.

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