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tinker9696
08-17-2014, 11:03 AM
I would appreciate any information regarding closing by doors and going bankrupt. Unfortunately i think it is something we have to consider. The only dept that would be the remaining lease of 3 years. We are in corporation and from that account I pay the rent and common area maintenance. We are also a LLC and all bills and stock get paid with that account. I am not throwing in the towel yet..we are at least paying the bills but I want to know what it entails if we should have to close.
We have recently asked the landlord for some rent relief meaning no increase which would have been this month and remove last years increase..would mean approx $200
not a lot but anything helps. He said he will think about it for a six month duration and get back to me.
any info you can provide is greatly appreciated
thanks

Freelancier
08-17-2014, 04:29 PM
Sorry to hear it. I'm assuming you mean bankruptcy of the LLC and not person bankruptcy...? Whose/What name is on the lease? If it's you personally guaranteeing the lease, you're stuck with it (and have to keep paying it to keep your credit from being damaged) and should work with the landlord to arrange a sub-lease as soon as you can. As for the rest, there may be local filings you have to do for any "going out of business" sale you plan to do as well as court filings to move the business into bankruptcy, so that any creditors can be paid from the assets of the company. Research bankruptcy filings in your state to find out more about what you need to do if you take that final step.

tinker9696
08-17-2014, 05:08 PM
yes I do not mean personal bankruptcy.
So if I'm understanding correctly..i would be responsible for the 3 years remaining on the lease and any other debt associated with the corporation or LLC.
So if I were not able to pay it how does he get the money if I don't have it in the business.
Would it than be attached to my personal finances?
As i said..Im not giving up yet but I want to know my options.
thanks

Freelancier
08-17-2014, 05:26 PM
i would be responsible for the 3 years remaining on the lease and any other debt associated with the corporation or LLC.No, you are responsible for anything where you personally guaranteed it. If the lease is in your name instead of the name of the LLC, then you are personally responsible for it. If there's anything in your personal name instead of the name of the LLC, that's your responsibility. Anything in the name of the LLC is handled through the bankruptcy proceedings.

And, yes, he wouldn't come after your business assets (although he might start there to be nice), but he'll come for you eventually if that's the name on the piece of paper. And he'd get it by getting a judgement against you for the balance of the lease and garnishing future wages or whatever other measures are available to him through the courts (and that will vary, so you'll want to talk with a local attorney to get really specific). That's why working with him to sublease is in everyone's better interest.

NOTE: I am not an attorney, this is just my opinion based on personal experience in another jurisdiction, so you'll want to get advice from someone more local to be sure I'm telling you what's right in your area.

tinker9696
08-18-2014, 12:53 PM
Thank you freelancier..very helpful and useful information..hopefully I wont need it.