Notice of Corporate Dissolution: Everything You Need to Know

1. Notice of Corporate Dissolution: Everything You Need to Know

Dissolution notices provide suppliers with the opportunity to collect outstanding debts. This announcement is one of the first steps  in dissolving a company. 

2. Dissolution of the company 

Dissolution of a company occurs after a company  voluntarily or is required to dissolve the company. In this process, all assets are liquidated to pay off the debt. Once a business has closed, the dissolution process  begins. The process can be long and complicated, but every step is important.

3. Forms of business dissolution 

Dissolution falls into one of two categories: 

Voluntary: Voluntary dissolution occurs when a unanimous vote is taken and all members  agree to dissolve the business. A company can be dissolved with a majority of votes provided that specific notice is given. This process is most often used when a business has been inactive for a long  time. However, large operating corporations may also qualify for dissolution by majority vote.

Involuntary: There are a number of situations in which the state may require the dissolution of a business, including failure to pay taxes, fraud, abuse of authority, failure to register an agent, or failure to notify the state of any major changes to the registered agent. It is important to note that some states have their own requirements that can lead to  involuntary dissolution if  not met.

4. Paying off debt before dissolution of the company 

In most cases, corporations must pay all debts before dissolution. The company is required to send notice to all suppliers of its intention to dissolve. The intention to dissolve must include a period of at least 120 days after the notice. Any outstanding supplier must then submit all outstanding invoices during that period. Failure to file within this time  will void the claim. 

Companies that may intend to dissolve are published in the official newspaper of  the county where the company is registered. In this case, unpaid sellers have up to 5 years to file a lawsuit against the company. If there are no funds left after  liquidation, all assets distributed to the directors will be paid to these claims. 

5. Bankruptcy claim 

Filing for bankruptcy instead of dissolution brings some financial relief to the company. Instead, the business will comply with the requirements of Chapter 7 or Chapter 13. However, the business is not dissolved after filing for bankruptcy. Bankruptcy must also be approved by the state. 

6. Voluntary dissolution of the company 

The shareholders of the company will vote for  voluntary dissolution. If there are enough votes in favor of dissolution, the intention to dissolve will be submitted to the state. Once the documents are filed with the state, the company begins the liquidation process. 

This process includes liquidation of assets and repayment of debts. If there is any money left over after this process, it will be divided among the board members and directors. 

Upon  completion of the liquidation process, the company will submit the Articles of Dissolution to the Secretary of State. The  dissolution charter must include the following information: 

Agree that all debts have been paid.  Documentation shows that all assets and assets of the company have been distributed to the appropriate parties. No legal action has been taken against the company.  After filing the dissolution articles, the company is officially dissolved and ceases to exist. 

7. Intention to dissolve 

One of the first and most important steps of the dissolution procedure is to fulfill the obligations of the enterprise. Enterprises wishing to dissolve must post their intention to dissolve. This dissolution intent must include the following information: 

• Detailed description of the complaint.
• Information regarding the claim, the amount of the claim and whether it was admitted.
• A mailing address where any complaints can be submitted.
• Deadline: At least after 120 days from the date of written notice.

Publication of the intention to dissolve  in a newspaper can also help  ensure that the intent is visible to all potential claimants. While advance notice is optional, it protects the business from latecomers. It can also prevent mistakes, such as distributing too much to admins and asking them to pay later. 

If you need help with your Notice of Dissolution, you can post your legal needs on the ACC Group marketplace. ACC Group only accepts