Sweet Quotes wrote:Hello everyone,
I have taken franchise of this Korean company X and have been misguided by them with false information. I started making losses and now I cannot continue running the business anymore. This franchisor has been threatening me constantly as the agreement is completely one sided favouring his advantage.
Unfortunately, Singapore law doesn't provide any kind of protection to new aspirant enterpreneurs and these companies continue to make money by cheating our legal system.
I am left with no choice but to windup my business. I would like to understand the below:
1. Mine is a private limited company, and if I windup, what will happen to all my investment and the assets?
Whatever is left in the company after paying off all creditors is what you will have left. For example, if you have computer equipment worth $1000, cash in bank of $3000 and business debts of $2000, the shareholders will received $1000 cash plus the computer equipment.
2. What is the procedure for winding up and what is the impact on the paidup capital?
You file notice of company dissolution with the ACRA. You can do it on Bizfile. Before you wind up, you must provide evidence that all your creditors are paid and/or that they relinquish their rights to collect their debts from you. Until creditor issues are resolved, you cannot close a company, and the creditors can force you into bankruptcy if you can't work out a deal.
3. How to find suitable lawyer who can help in the procedure and what will be the expenses for the lawyer services?
Unless you are talking large sums of money, you'll probably want to avoid a lawyer. It will be very expensive. You'd be better off finding someone to negotiate with your creditors to make them go away. I do this in the USA but not in Singapore.
In short, if you've got a positive balance sheet after paying off your creditors, wind up is easy. If you have unpaid creditors, you need to deal with them before winding up.
