Members Voluntary Liquidation. Appointment Package

Transcription

1 Members Voluntary Liquidation Appointment Package This package contains the necessary instructions and documentation to place a company into Members Voluntary Liquidation. Documents contained in package Statement of Resolutions by Directors Form Declaration of Solvency Statement of Resolutions by Members A copy of this package, a Fact Sheet and other useful information can be obtained from our Web Site located at

2 Steps Involved This package sets out the steps to appoint a liquidator to a Members Voluntary Liquidation. These steps are: Step 1 Passing of resolutions by the directors and execution of Declaration of Solvency Step 2 Passing of resolutions by members The procedures involved for each step and the documents required are provided in this package. A Fact Sheet and further information on these processes can be obtained from What can you do in preparation for the appointment? To expedite the process of winding up the company s affairs and reducing the costs involved, you may wish to complete the following tasks prior to the appointment: 1. Completion of up-to-date financials statement with details of all equity, reserve and franking accounts; 2. Lodgement of the company s final tax return(s); and 3. Payment of all external creditors and employees of the company. These tasks are not required to be completed prior to the appointment, but will assist with the winding-up of the company s affairs. Other Information The Australian Securities and Investments Commission and the Insolvency Practitioners Association of Australia have jointly released several fact sheets that may be of assistance to directors, shareholders, creditors and employees of companies in voluntary administration, liquidation or receivership. These fact sheets are: These can be found on our website on the Fact Sheets page. Liquidation: Guide to Creditors Liquidation: Guide to Employees Guide to Shareholders Guide to Directors Glossary of Terms

3 Step 1 Directors passing resolutions Prepare the Declaration of Solvency Section 494 Corporations Act A Declaration of Solvency (Form 520) must be lodged with the Australian Securities & Investments Commission before the members can resolve to commence the liquidation. This declaration contains the estimated realisable values of the company s assets, its outstanding liabilities and details of the expected surplus to be distributed amongst members. It is essential that the directors establish that the company is in fact solvent prior to executing this declaration, as a Members Voluntary Winding Up can only commence if the company is solvent, and able to pay all of its creditors within 12 months of the appointment of the liquidator. Directors should endeavour to have the Declaration of Solvency prepared and executed at the date of the resolution being passed by them. The Statement by Directors The directors can either hold a formal director s meeting, or execute a statement of that resolution under section 248A (more than 1 director) or 248B (1 director) of the Corporations Act. The Act states: CORPORATIONS ACT SECT 248A Circulating resolutions of companies with more than 1 director (replaceable rule see section 135) (1) The directors of a company may pass a resolution without a directors' meeting being held if all the directors entitled to vote on the resolution sign a document containing a statement that they are in favour of the resolution set out in the document. (2) Separate copies of a document may be used for signing by directors if the wording of the resolution and statement is identical in each copy. (3) The resolution is passed when the last director signs. CORPORATIONS ACT SECT 248B Resolutions and declarations of 1 director proprietary companies (1) The director of a proprietary company that has only 1 director may pass a resolution by recording it and signing the record. (2) The director of a proprietary company that has only 1 director may make a declaration by recording it and signing the record. Recording and signing the declaration satisfies any requirement in this Act that the declaration be made at a directors' meeting. Once the Declaration of Solvency is prepared, the directors need to resolve: That the company is solvent and able to pay all its debts within a period of (12) twelve months; That the Declaration of Solvency be approved and executed; and That the members consider a resolution that the company be wound up. Once the directors have executed the Statement of Resolutions by Directors and the Declaration of Solvency, the following documents should be forwarded to Worrells: Copy - Statement of Resolution by Directors Original - Declaration of Solvency The original of the Statement of Resolutions by Directors should be kept in the Corporate Register. Once the above documents are received by Worrells, we will lodge the Declaration of Solvency with the Australian Securities & Investments Commission and advise you that the members can consider their resolutions. The Statement by Members cannot be made until the Declaration of Solvency is filed with the Australian Securities & Investments Commission, but must be sign within 5 weeks after the execution of the Declaration of Solvency.

4 STATEMENT OF RESOLUTIONS BY DIRECTORS COMPANY NAME: A.C.N. Section 248A - Section 248B Corporations Act 2001 We, the undersigned, being all of the directors of, A.C.N. ( the company ) entitled to vote at a meeting of directors of the company hereby state that we are in favour of the resolutions set out in this document being recorded: Resolved VOLUNTARY WINDING UP That the company should be voluntarily wound up in a member s voluntary winding up and that this will be recommended to the members of the company DECLARATION OF SOLVENCY Having formed the opinion that the company could pay its debts in full within a period of twelve (12) months from the commencement of winding up it was resolved that the directors would sign the Declaration of Solvency. All directors entitled to vote must sign if more than 1 Name (Print Name) Date

5 ASC registered agent number: lodging party or agent name: address: telephone: facsimile: DX number suburb/city Australian Securities Commission form 520 Declaration of Corporations Act solvency 494(1) & (2) Company name A.C.N. Declaration We declare (a) that we constitute a majority of the directors of the company, and that we have enquired in to the affairs of the company. (b) (c) that at a meeting of directors, we have formed the opinion that the company will be able to pay its debts in full within 12 months of the commencement of winding up. that a correct statement of the company's assets and liabilities as at the latest practicable date ( specified on the statement ) before the making up of this declaration is set out on page 2 of this form set out in the annexure marked ( ) of ( ) pages. Signatures This form must be signed by as many of the directors as constitute a majority and in any event not less than 2 directors. 1. sign here date 2. sign here date 3. sign here date 4. sign here date 5. sign here date 6. sign here date (if insufficient space) Further details are enclosed in the annexure marked ( ) of ( ) pages. Annexures must conform to the requirements shown at the end of this form.

6 Statement of assets and liabilities (show amounts to the nearest $) date of statement (d/m/y) / / assets estimated realisable values cash at bank cash on hand marketable securities bills receivable trade debtors loans and advances unpaid calls stock in trade work in progress, as detailed in inventory freehold property leasehold property plant and machinery furniture, fittings, utensils, etc patents, trade marks, etc investments other than marketable securities other property, as detailed in inventory estimated realisable value of assets liabilities rank for payment secured on specific assets secured by floating charge(s) estimated expenses of winding up other estimated expenses (including interest accruing until payment of debts in full) unsecured creditors ( amounts estimated to rank for payment) trade accounts bills payable accrued expenses other liabilities contingent liabilities total of liabilities estimated surplus after paying debts in full

7 The Statement by Members Step 2 Members passing resolutions The members can either hold a formal meeting of members, or execute a statement of that resolution under section 249A (more than 1 member) or 249B (1 member) of the Corporations Act. The Act states: CORPORATIONS ACT SECT 249A Circulating resolutions of proprietary companies with more than 1 member (1) This section applies to resolutions of the members of proprietary companies that this Act or, if a company has a constitution, the company's constitution requires or permits to be passed at a general meeting. It does not apply to a resolution under section 329 to remove an auditor. (2) A company may pass a resolution without a general meeting being held if all the members entitled to vote on the resolution sign a document containing a statement that they are in favour of the resolution set out in the document. Each member of a joint membership must sign. CORPORATIONS ACT SECT 249B Resolutions of 1 member companies (1) A company that has only 1 member may pass a resolution by the member recording it and signing the record. (2) If this Act requires information or a document relating to the resolution to be lodged with ASIC, that requirement is satisfied by lodging the information or document with the resolution that is passed. Once we have advised you that the Declaration of Solvency has been filed with the Australian Securities & Investments Commission, the members can execute the Statement of Resolutions by Members. The members need to resolve the following points: That the company be wound up voluntarily and that «Potential.Appointee1Name» and «Potential.Appointee2Name» be appointed Liquidators for the purpose of such winding-up; That the Liquidators be authorized to distribute in specie such assets of the company as they may determine; That the remuneration of the Liquidators be approved at a time basis applying the simplified Solvency Management Rates published from time to time by Worrells (refer to the Worrells web-site); That the Liquidators be empowered to destroy the records of the company 6 months after the completion of the winding up. The original Statement of Resolutions by Members should be returned to Worrells once executed. The company is placed into liquidation when the last member executes the statement. What will Worrells do then? Our tasks will be as follows: 1. To liquidate the remaining assets of the company (if any or as required); 2. To ensure that all external creditors and employees have been paid and that no further claims exist against the company; 3. To obtain Tax Clearance from the Australian Taxation Office, which may entail filing final Taxation Returns if they have not been filed already; and 4. Distribute the surplus funds (or asset in specie if warranted) to the shareholders of the company.

8 STATEMENT OF RESOLUTIONS BY MEMBERS COMPANY NAME: A.C.N. Section 249A - Section 249B Corporations Act 2001 We, the undersigned, being all of the members of, A.C.N. ( the company ) entitled to vote at a meeting of members of the company hereby state that we are in favour of the resolutions set out in this document being recorded: SPECIAL RESOLUTIONS Resolved 1. That the company be wound up voluntarily and and of Messrs Worrells be appointed liquidators for the purposes of such winding up. 2. That the liquidators be and are hereby authorised to distribute in specie such assets of the company as they may determine. ORDINARY RESOLUTIONS Resolved 3. That the remuneration of the liquidators and his agents and staff be determined on a time basis applying the Simplified Solvency Management Rates published from time to time by Worrells and that the liquidators be empowered to draw their fees from time to time. 4. That the liquidators be authorised to destroy the records of the company 6 months after the finalisation of the liquidation. All members entitled to vote must sign if more than 1 Name (Print Name) Date

9 INDEMNITY BETWEEN LIQUIDATOR AND MEMBERS and Worrells Solvency & Forensic Accountants Dear Sirs I, the undersigned shareholder of A.C.N. hereby agree to indemnify you and keep you indemnified against all costs, actions, suits, claims, demands, expenses and liabilities, including but not limited to any liability for tax, which may be brought or made against or incurred by you in connection with your activities as Liquidators of the company. Date: EXECUTED by [Shareholder]([A.C.N.]) in accordance with Section 127 of the Corporations Act 2001: Director (of shareholder) Director (of shareholder) EXECUTED by Shareholder 1 Shareholder 2