Mr Cooper Group Inc (COOP)

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AI - The quoted statement means that for U.S. federal income tax purposes, the transfer of assets to the liquidating trust is treated as if those assets were directly transferred to the creditors and equity holders in satisfaction of their claims or cancellation of their equity interests in the company. In other words, it is a deemed transfer from the company to the creditors/equity holders, followed by a deemed transfer from the creditors/equity holders to the liquidating trust.
Regarding your second question - yes, typically the creditors and former equity holders of the company are issued beneficial interests or units in the liquidating trust in exchange for their claims against the company or their canceled equity interests. These liquidating trust interests represent their rights to receive distributions from the trust as its assets are liquidated over time