Commonly, many business owners prepare themselves only to start up a company. On the other hand, just a few people know how to dissolve a company in Florida.
Despite the reasons behind the decision to dissolve the company, the fact is that the process is not summarized by turn off the lights, close the company’s doors and go away. The process of dissolving a company in Florida has requirements under the Florida Business Corporation Act.
In any case, seeking the help of a business attorney may be the wiser solution, as the procedures involved in dissolving a company can be complex. The details tend to vary according to the nature of the company.
In this article, we provide an overview of the essential steps for those interested in dissolving a company in Florida.
Smaller and simpler companies have an easier path when it comes to dissolving a business. The process begins when the business owner completes the necessary forms to dissolve it.
All the necessary paperwork for the process is available online on the Sunbiz.org official website. The website is under control of the Florida Department of State Division of Corporations.
However, it is not possible to submit the documents through the Division of Corporations website. Business owners should type the requested information into the relevant fields, print everything out and send it via US mail.
The process is different for companies that have issue shares and accepted funds and other assets for an ownership interest. Once someone has invested in a company by purchasing shares of stock, this individual is considered one of the owners.
It is impossible to sell or cease operations without the consent of all existing owners. Hence, it is fundamental to notify all stakeholders that the corporation is about to be dissolved.
For that purpose, business owners need to comply with the rules contained in the company’s Articles of Incorporation and Bylaws on how to call a meeting for purposes of terminating the business.
Once the business owners have the meeting set up, members of the board of directors need to formally bring up the idea of dissolution for a voting process.
Smaller companies tend to have smoother procedures when it comes to this phase, as some of the shareholders are usually members of the board as well. On the other hand, larger companies tend to get stuck at this stage, given that not all stakeholders are prone to agree immediately.
Filling Out Dissolution Forms
When all shareholders reach an agreement, it is time to fill out the required paperwork to dissolve the company. The form utilized in this process is the Articles of Dissolution.
Before proceeding to fill the papers, we highly recommend business owners to seek help from a business attorney to understand the process details.
The paperwork must include:
- The company’s full legal corporate name, as registered in the Division of Corporations.
- The date that you filed the Articles of Incorporation.
- The intended date for the company’s dissolution to officially become effective. This date must be within the next 90 days after filing the paperwork.
- Some details regarding the voting to dissolve the company (commonly a corporate resolution).
Companies that did not initiate operation or never issued shares must supply the name and relevant dates the same way.
Additionally, it is necessary to include an attestation that the company has not issued any shares, conducted any business, and has no outstanding debts or legal obligations. In this case, the attestation must include that all members of the board of directors agreed with the dissolution.
The Notice of Dissolution
Although a notice of dissolution is not compulsory to dissolve a company, some business owners may opt for preparing this document.
The document is an official statement that the business has ceased its activities. Consequently, a notice of dissolution may be useful in case the company has any debts or legal obligations.
Submitting the Paperwork to the Division of Corporations
Once all these procedures are over, the paperwork needs to be submitted to the Division of Corporations. It is highly recommended to include a cover letter detailing all documents included in the packet.
This final procedure will also require the business owner to provide a check for all required fees. These fees will vary depending on the method used in the company’s dissolution.
The process of dissolving a company in Florida can be remarkably complex. Hence, the best approach is to seek guidance from a business attorney to help to soothe the process.