lev-os Plan of Liquidation and Dissolution
Produces a governance-compliant dissolution plan covering approval history, creditor notice, claims administration, liquidation sequencing, distribution mechanics, tax clearance, and state termination filings.
Quick Start
Gather before drafting:
- Entity docs — charter, bylaws, shareholder agreement, state of incorporation.
- Board resolution — date, quorum, vote counts, authorization language.
- Shareholder vote — consents or meeting results with class-vote handling if applicable.
- Financials — stock ledger (class/rank), asset/liability schedules, pending litigation, tax status.
- Filing requirements — state secretary of state forms/fees/waiting periods, Form 966 deadline.
- Creditor communications plan — known creditor list, publication channel for unknown creditors.
Core Workflow
1. Build Entity & Jurisdiction Matrix
| Item | Inputs | Controls |
|---|---|---|
| Entity identity | Legal name, formation state, tax ID, principal office | Mirror formation records exactly |
| Timeline | Target adoption, creditor response, filing dates | State-compliant intervals [VERIFY] |
| Approvals | Board + shareholder actions, class vote mechanics | Include vote tallies and rights analysis |
| Creditor admin | Known/unknown creditor list, claim deadlines, reserves | Align notice language with statute [VERIFY] |
| Distribution | Liabilities stack, reserves, preference classes | Document liquidation preference and conversion formula |
| Tax package | EIN, filing history, state tax IDs | Integrate Form 966 and final tax obligations |
2. Draft Sections (Fixed Order)
- Preamble & Recitals — corporate identity, statutory basis, date, reasoned basis.
- Authorization — board meeting/consent details, shareholder vote by class, exhibit references.
- Notice & Claims — delivery methods, deadlines, publication terms, claim form language.
- Winding Up — contract closure, litigation handling, asset conversion strategy.
- Priority Payments — expense waterfall: liquidation costs → wages → taxes → secured → unsecured → contingencies. Include reservation schedule.
- Shareholder Distribution — class-based preference, pro rata mechanics, in-kind vs. cash, per-share calculation worksheet.
- Tax & Compliance — Form 966 filing, final returns, state/federal clearances, record retention.
- Dissolution Filings — Articles/Certificate of Dissolution, signature authority, filing checklist.
- Execution — effective date, cure period, officer certification, signature blocks.
3. Deliverables Checklist
[ ]Date-stamped preamble and recitals[ ]Governance evidence paragraph for each required threshold[ ]Creditor notice log template and publication proof list[ ]Reserve memo (disputed, environmental/contingent, tax exposure)[ ]Distribution worksheet by share class[ ]State filing exhibit index with filing copies[ ]Post-filing action list with retention and audit handling
Pitfalls & Checks
- Define "dissolved," "wound up," and "terminated" separately — never interchange without definition.
- Preserve board/shareholder decision chronology as enforceable fact paragraphs.
- Never state creditors are "waived" without documented statutory or consent basis.
- Unknown creditors: use published notice period exactly as permitted by state law [VERIFY].
- Include separate class distribution schedule whenever preferred rights exist, even if zero-value.
- Add statutory references only after jurisdiction verification [VERIFY].
- Nonprofit wind-down: route residual assets to qualified tax-exempt recipients per governing tax law [VERIFY].
- Retain closing papers and tax support for statutory period (typically 3–7 years; confirm exact duration).