1. What is an Assignment for the Benefit of Creditors?
A transfer of all assets to a third party called an "Assignee" for the benefit of the transferrers (called "Assignor") creditors
The Assignee liquidates the assets and reduces them to cash
The Assignors creditors have up to 180 days to file claims with the Assignee
By filing a claim, creditors agree to participate as a contracting party to the General Assignment and are bound by its terms
From the cash received from the liquidation of the assets Assignor pays costs of the Assignment for the Benefit of Creditors and distributes the remaining funds to creditors on a pro rata basis in accordance with statutory priorities.
