Liquidating a company?

[Coconutwheels]

G'day All,

In a generalised answer.....what ramifications would there be for the Director of a company that went into voluntary liquidation?

Purpose being to to end a franchise agreement that the company has entered into.

I know this would be complex and very specific to individual circumstance, but just after general ideas I.e would it affect borrowing capacity for the director in the future or their ability to operate another company?

Any thoughts welcome.
Cheers,

 

[Aaron_C]

A company placed in voluntary liquidation generally has no impact on the director's own personal guarantees as long as there is a letter from the liquidator advising that the director has no debts arising from the liquidation. Did a few of these before, no problemo.

 

[Terry_w]

This would affect the director in several ways

1. Licensing for roles such as being a financial planner, real estate agent, mortgage broker (but not solicitor!). When applying for licensing there are questions asked including have you ever/within last 10 years been director of a company that has gone into administration of liquidation.

2. Future borrowings. Lenders would be possibly aware of this from your credit report and ask questions. It will have an impact, especially if there are unpaid debts.

3. Personal guarantees - you could be liable for any debts incurred by the company if you have given personal guarantees etc.

You should seek legal advice.

 

[Coconutwheels]

This would affect the director in several ways

1. Licensing for roles such as being a financial planner, real estate agent, mortgage broker (but not solicitor!). When applying for licensing there are questions asked including have you ever/within last 10 years been director of a company that has gone into administration of liquidation.

2. Future borrowings. Lenders would be possibly aware of this from your credit report and ask questions. It will have an impact, especially if there are unpaid debts.

3. Personal guarantees - you could be liable for any debts incurred by the company if you have given personal guarantees etc.

You should seek legal advice.

Defiantly would seek legal advice if it progresses.

Basically we have been trying to sell our franchise for a while, it's profitable (the best it's ever been) but no takers. A major competitor is interested to which I've said we are still in an agreement with current franchisor. They mentioned liquidation, like it was no major issue, but I'm feeling very cautious!

Thanks for the responses.

 

[Ausprop]

i don't understand any of this... you want to liquidate a profitable operation? how will liquidating help you? why not sell the company to the competitor?

if you really want to liquidate just pay a backpacker $1000 to go director - let it run for a while tho, give it a clear 6 months