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Posted: Wed Sep 07, 2005 11:19 pm Post subject: Winding up questions
Hi,
I am an owner/director of a my business that has been trading fro about 4 years in field of telecommunications providing wholesale carrier services to voice service providers internationally.
Our turnover is about a million pounds every year with about 200k profit showing on accounts... We only have two employees as there is not much labour required in our business...
About two years ago when our business was good and less competition was inplace, we purchased an office property worth of £525,000 in bracknell where we planned to continue business from, prior to that we were working from home in home/office environment...
In the past year we have had lots of failure in several international projects that we invested in and also were hit by competition on existing revenue making services that we had, even during three months last year had a very heavy debt (around 40k) on our business credit cards to pay for the ongoing expenses of the business...
We have no other asset written for the business other than the building...
We DO NOT have any personal guarantee on the business...
Fortunatly we do not owe anything to the tax office...
The debt we have with out trading partners now is about overall £30,000
As some of the projects failed hence the big office was no longer required and we decided to move back in to our home office... The office building is now being used only for our mailing address and we are paying about 4k per month for its mortgage whilst its unused since last year...
Our business now generates about 12-15k per month however i find most of it is being spent of interest and we dont receive anything at the end. (and some personal interests such as our home mortgages) leaving us in a big cashflow problems...
We had decided to sell the office about 6 months ago with much reduced price of about 420k (making a loss of 100k to fit the current market prices in this area, 100k was the money we put in initially) however it is not going well and seems no one is really buying offices anymore in this area...
There are new projects that we think they could inject cash into our system however because of day to day hassle of facing with fanancial problems and existing debs with trade partners they are being overlooked and we cant find the time to deal with them...
I am considering going to liquidation that i think the bank will then get hold of the building and company has to arrange payments for creditors which are only abour 3-4 companies...
The question is:
1) Could whilst the liquidation process any of the creditors including the bank claim anything from director's personal properties (such as my home etc) Again, none of the directors have personal guarantee on the company/bank...
2) I know i cannot be a director of another company with similar names however can i continue trade with the existing companies i am doing business with under another company name? would the liquidator look at this as stealing of "intelectual property" of my business and using it on the new company?
3) what will happen to the creditors if the company does not have any funds/assets to pay them? would i as the director be qualified as "wrongfully trading" and be affected by any laws?
4) How does one is qualified as "wrongfully trading" even if i recognize that company is heading to insolvancy and to keep things running in the mean time i have to keep trading, wouldnt that be called "trading whilst insolvant"?
5) How would having insolvancy practitioner help during this process?
6) Have you been in similar situation before where you had creditors and you had to liquidate your company? what happened to you there after??
7) I am worried how involved must i be with the liquidation process and if that process will also occupy most of my time to not allow time for any other venture...
I am hearing of "voluntary liquidation" is that something that most fit to my situation??
Any comment on your previous experiences on this is extremly appreciated as i am desprate for some advice here...
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I am hearing of "voluntary liquidation" is that something that most fit to my situation??
