Liquidation, Final Sale, and dissolution

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---
schema: foundry-doc-v1
title: "Liquidation, Final Sale, and dissolution"
slug: liquidation-final-sale-and-dissolution
category: distributions
index_group: distribution-policy-and-mechanics
type: topic
content_type: topic
quality: complete
short_description: "How Professional Centres Canada LP winds down: the events that trigger dissolution, the Final Sale mechanism, and the order in which liquidation proceeds reach limited partners."
status: active
bcsc_class: public-disclosure-safe
language_protocol: PROSE-TOPIC
last_edited: 2026-08-24
editor: pointsav-engineering
paired_with: liquidation-final-sale-and-dissolution.es.md
---

[[professional-centres-canada-lp-structure|Professional Centres Canada LP]] pays debts and contingent liabilities before a single dollar of liquidation proceeds reaches a limited partner. This article covers the Canadian limited partnership's dissolution and wind-up mechanics only; the parallel vehicles in the United States, Spain, and Mexico use different governing instruments, not described here.

## What this replaces

[[perpetual-equity-model|Perpetual Equity Model]] describes why unit holders face no mandatory exit and no fixed fund cycle. A structure with no scheduled end still needs a defined process for the eventual one. An ordinary transfer or over-the-counter sale settles one holder's position, but only a wind-up mechanism can convert the partnership's remaining assets into cash and return it to everyone at once, in a fixed order. Article 13 and Section 2.9 of the limited partnership agreement are that process.

## What triggers dissolution

The partnership dissolves on the earliest of four events. The general partner sets a termination date, on at least 30 days' written notice. The limited partners approve a different date by Special Resolution. The general partner is dissolved, becomes insolvent, or is placed into receivership and no replacement is appointed within 180 days, triggering automatic dissolution. Or a Final Sale is implemented. A limited partner has no right to seek dissolution, wind-up, or a distribution of partnership assets outside this framework — the partnership does not end because an individual partner dies, becomes insolvent, or transfers its units.

## The Final Sale mechanism

The [[distribution-declaration-mechanics|Initial Period]] is the period during which cumulative distributions have not yet reached 100% of the gross proceeds limited partners paid for their units. After it ends, the general partner may conclude a sale of all or substantially all of the partnership's business and assets to an arm's-length purchaser, for consideration that may include cash or securities available for distribution to limited partners. This is a Final Sale. Where the transaction fits that description, the general partner may implement it on at least 21 days' notice to limited partners, without a vote. Where it does not, the general partner must instead call a meeting and put the transaction to a Special Resolution before implementing it as a Final Sale.

## The liquidation waterfall

Once dissolution occurs, a receiver winds up the partnership's affairs in a fixed order. That receiver is ordinarily the general partner, or — where the automatic-vacancy trigger applies — another receiver the limited partners appoint by Special Resolution. The order is:

1. **Liquidate the assets.** Securities the partnership owns are sold, in the market or by private sale, with the objective of full liquidation and no distribution of assets in kind, unless liquidating a particular security is not practicable — in which case that asset is distributed to limited partners directly, pro rata, subject to any required regulatory approval.
2. **Pay debts and liabilities.** The partnership's debts, liquidation expenses, contingent liabilities, and other indebtedness — including accrued interest — are paid or provided for before any distribution to partners.
3. **Distribute what remains.** Limited partners with a credit balance in their capital and current accounts are paid first, proportionate to that balance, treated as a return of capital or a current return. Any further remaining assets are then distributed to limited partners generally; unsold securities, if any remain, are transferred as an undivided interest and later partitioned so each limited partner receives its share outright.
4. **Complete the statutory formalities**, including filing a notice of termination under the *Partnership Act*.

The agreement will not terminate until this order of priority has been carried out in full, regardless of when dissolution itself occurred.

## The general partner's extension right

The general partner may not always convert all of the partnership's assets to cash or freely trading securities by the termination date. Where that happens, it may extend the wind-up by up to three months, on at least 30 days' prior written notice to limited partners, where it determines the extension serves their best interests.

## What happens to the promoter's escrowed equity

The promoter's minority equity interest, described in [[professional-centres-canada-lp-structure|Professional Centres Canada LP — Direct-Hold Solution Structure]], is held in escrow until limited partners recover 100% of their contributed capital or another defined liquidity event occurs. A Final Sale is one such event: on a Final Sale, the escrowed units are released immediately, free of any transfer restriction not of general application to all units, and share equally, unit for unit, in the resulting distribution.

## What this is not

This article covers only the dissolution, Final Sale, and liquidation-waterfall mechanics set out in Article 13 and Section 2.9 of the Canadian limited partnership agreement. It is not a description of the ordinary [[distribution-declaration-mechanics|distribution mechanics]] that apply while the partnership is a going concern, or of the general-partner-removal procedure covered in [[special-resolutions-and-general-partner-removal|Special Resolutions and General Partner Removal]], which can itself trigger the automatic-vacancy dissolution event described above if no successor is appointed in time. It is not a description of dissolution or wind-up mechanics in the United States, Spain, or Mexico vehicles, which are governed by separate instruments. It is not legal or tax advice; a limited partner should consult the limited partnership agreement and qualified counsel for the mechanics applicable to its own units.

## See also

- [[distribution-declaration-mechanics|Distribution Declaration Mechanics]] — the ICR gate and proportional allocation that govern ordinary distributions
- [[perpetual-equity-model|Perpetual Equity Model]] — why unit holders face no mandatory exit outside the wind-up process described here
- [[professional-centres-canada-lp-structure|Professional Centres Canada LP — Direct-Hold Solution Structure]] — the promoter's escrowed equity and its release conditions
- [[special-resolutions-and-general-partner-removal|Special Resolutions and General Partner Removal]] — the Special Resolution vote that can approve a Final Sale outside the general partner's direct authority