Business liquidation refers to the process by which a company is terminated and its assets redistributed. The termination may be of the entire company or just part of it. Other terms used to refer to the same process are dissolution and winding-up. However, technically speaking, dissolution is the last step of liquidation. When in need of experts in business liquidation Arlington TX is the right location to consider making a visit to.
Two kinds of winding-up are in existence, that is voluntary and compulsory dissolution. The voluntary variety is also called shareholder dissolution while the other one is also called creditor dissolution. Creditors can also control voluntary dissolution in certain situations. Petition for dissolution can only be done by certain parties that vary with the jurisdiction. The parties fall into five main categories.
The five parties are the company itself, official receiver, the secretary of state, contributories, and any creditor. In the same way that parties that can lodge the dissolution of a company vary from one state to another, the grounds for dissolving companies also vary from jurisdiction to another. Generally, the company may resolve to wind-up its operations and redistribute its assets by its own accord. That makes the first ground for dissolution.
The second reason for dissolution is if a company does not received a certificate to trade in a 12-month time frame upon being incorporated as a corporation. A company is also feasible for dissolution after twelve months of failing to start operations from the day of incorporation. The fourth reason for dissolution is when the number of members that a company is required by statute to have is not met.
Companies may also be dissolved if they cannot pay off their debts. Lastly, if it becomes clear that dissolving the business would be fair and equitable, a party may lodge a case with the court towards that end. In practice, most companies dissolved in the United States do so due to the last two reasons. A fair and winding-up allows for application of strict legal rights give all shareholders equitable consideration in the company.
The instance a petition is made to liquidate a company, the dissolution process is considered to have started. Upon making the petition, litigations about the company are restrained and dispositions on its property are voided. Upon receiving the petition from a party, the court bases on the grounds filed to prompt the dissolution and makes a decision as to whether the process should proceed or not. Court-appointed liquidators or official receivers may aid in the process.
Voluntary dissolution happens when the company makes the decision to voluntarily terminate its operations and wind-up. Upon such a resolution, all ongoing operations are halted immediately. A creditor voluntary liquidation is a process that allows insolvent companies to voluntarily stop their operations and wind-up. The board makes the decision to liquidate the business.
There is a certain order of priority that is followed in distributing assets of a company that is undergoing dissolution. Strict laws are enforced in following that order of priority. The laws ensure that fair and equitable settlement of claims by shareholders, creditors, and other claimants is achieved.
Two kinds of winding-up are in existence, that is voluntary and compulsory dissolution. The voluntary variety is also called shareholder dissolution while the other one is also called creditor dissolution. Creditors can also control voluntary dissolution in certain situations. Petition for dissolution can only be done by certain parties that vary with the jurisdiction. The parties fall into five main categories.
The five parties are the company itself, official receiver, the secretary of state, contributories, and any creditor. In the same way that parties that can lodge the dissolution of a company vary from one state to another, the grounds for dissolving companies also vary from jurisdiction to another. Generally, the company may resolve to wind-up its operations and redistribute its assets by its own accord. That makes the first ground for dissolution.
The second reason for dissolution is if a company does not received a certificate to trade in a 12-month time frame upon being incorporated as a corporation. A company is also feasible for dissolution after twelve months of failing to start operations from the day of incorporation. The fourth reason for dissolution is when the number of members that a company is required by statute to have is not met.
Companies may also be dissolved if they cannot pay off their debts. Lastly, if it becomes clear that dissolving the business would be fair and equitable, a party may lodge a case with the court towards that end. In practice, most companies dissolved in the United States do so due to the last two reasons. A fair and winding-up allows for application of strict legal rights give all shareholders equitable consideration in the company.
The instance a petition is made to liquidate a company, the dissolution process is considered to have started. Upon making the petition, litigations about the company are restrained and dispositions on its property are voided. Upon receiving the petition from a party, the court bases on the grounds filed to prompt the dissolution and makes a decision as to whether the process should proceed or not. Court-appointed liquidators or official receivers may aid in the process.
Voluntary dissolution happens when the company makes the decision to voluntarily terminate its operations and wind-up. Upon such a resolution, all ongoing operations are halted immediately. A creditor voluntary liquidation is a process that allows insolvent companies to voluntarily stop their operations and wind-up. The board makes the decision to liquidate the business.
There is a certain order of priority that is followed in distributing assets of a company that is undergoing dissolution. Strict laws are enforced in following that order of priority. The laws ensure that fair and equitable settlement of claims by shareholders, creditors, and other claimants is achieved.
About the Author:
Find a list of the advantages of using business liquidation Arlington TX services and more info about a reputable service provider at http://www.frlauctions.com right now.
No comments:
Post a Comment