LIQUIDATION

(1)

Liquidation shall be carried out after the dissolution of a company.

(2)

(New, SG No. 83/1996) The term for completion of the liquidation shall be determined by the General Meeting of the limited liability company and the joint-stock company, and for other companies, by unanimous decision of the partners with unlimited liability. Such a term shall also be determined by the court in its decision for appointing liquidators. Where necessary, the term determined as above may be extended.

(3)

(Former Paragraph 2 SG 83/1996, Amended - SG 84 - 2000) The liquidators shall be registered in the commercial register where shall be presented their notary certified specimen signatures.

(4)

(Former Paragraph 3, Amended - SG No. 83/1996) The Court of registration may, where important reasons exist, appoint or dismiss liquidators on application by the partners, or, respectively, by the shareholders which own at least one twentieth of the stock.

(5)

(New, SG No. 83/1996) The remuneration of the liquidators shall be fixed by:

1.

the General Meeting of the limited liability company or the joint-stock company;

2.

the partners with unlimited liability in a company, unanimously;

3.

the court, where the liquidators have been appointed by it.

(6)

(New, SG No. 83/1996) The liquidators shall be liable for their activities related to the liquidation in the same way as the managers and the other executive bodies of companies.

Upon declaring the dissolution of the company the liquidators must invite its creditors to make their claims. The notice shall be in writing and delivered to known creditors, and shall also be published.

(1)

A liquidator shall be obliged to consummate pending transactions, to collect payments due, to convert the company's assets into cash and satisfy its creditors. A liquidator may not enter into new transactions unless so warranted for the purposes of liquidation.

(2)

A liquidator may, subject to the consent of the partners or, respectively, the shareholders, and the consent of the creditors, transfer to them particular items of the assets under liquidation, provided that this does not prejudice the rights of the remaining partners and creditors.

(3)

The liquidators must inform the tax administration of the liquidation which has commenced.

(1)

The liquidators shall represent the company and shall have the rights and obligations of its executive organ.

(2)

The liquidators may represent a company only jointly. A single liquidator may accept legal statements addressed to the company.

(1)

The liquidators shall draw up a balance sheet as of the moment of dissolution of the company, and explanatory notes thereto. At the end of each year the liquidators shall close accounts and present a financial statement and annual report to the governing body.

(2)

The governing body shall resolve on approval of the opening balance sheet, the annual closing of accounts, and on holding the liquidators harmless.

(1)

A company in liquidation may merge into another company:

1.

by decision of the General Meeting of the limited liability company or the joint-stock company;

2.

by unanimous decision of the partners with unlimited liability in other companies.

(2)

The provisions of Article 263 shall be observed in case of a merger.

(3)

After entering the merger in the commercial register the liquidation shall be terminated. The application for entering shall be filed by the company into which the other company is merging. The managing body of the same company shall make decision on the report of liquidators and their liability.

Upon satisfaction of the creditors, the remaining assets shall be distributed among the partners, or among the shareholders as the case may be.

(1)

(Amended, SG No. 83/1996) The company's assets shall not be distributed before six months have passed from the date that the notice to the creditors was published.

(2)

Should a creditor duly notified not assert its claim, the sum owed to it shall be deposited in a bank account in its name.

(3)

Where a liability is disputed, assets shall not be distributed until the creditor concerned has been secured.

(4)

(New, SG No. 83/1996) The managing body of the company may, upon satisfaction of the creditors, write off any bad amounts receivable of the company. Such decision shall be taken by simple majority.

(1)

The liquidation proceeding of the company shall be stopped since the date of the decision for opening the bankruptcy proceedings. The liquidation proceedings shall be terminated since the decision under Art 630 enters into force.

The court shall declare the bankruptcy of the company - debtor under Art. 630, Par. 2 with the decision for opening the bankruptcy proceedings.

(2)

In the cases under Par. 1 the court on bankruptcy shall be oblige to send a written notice to the court on liquidation in the same day.

(1)

In case bankruptcy proceedings has been opened for a company in liquidation, the Liquidator shall be obliged to present at the court on bankruptcy the balance sheet with final date the decision for opening the bankruptcy proceedings and a report on his activity under Art. 270 within 7 days since the termination of the bankruptcy proceedings.

(2)

The appointed assignee in bankruptcy the debtor or creditor  might object on the balance and report under Par. 1 within 7 days after they are presented at the court.

(3)

The court shall state on the objection with a "definition" which is final.

(4)

If in the term of Par 2 an objection is not presented at the court, the balance sheet and the report shall be considered approved.

(5)

While the liquidation proceedings is stopped, the Liquidator shall not have the right t carry out the duties provided in Chapter 17.

(1)

(Supplemented SG 84 - 2000) When all liabilities have been settled and the remaining assets distributed, the liquidator shall apply for deletion of the company from the Commercial Register. The decision on deletion shall be published in the State Gazette if  the founding of the company has been subject to a publishment.

(2)

Should at some later time the need arise for further liquidation proceedings, the court shall, on application by the person concerned, appoint liquidators, either the previous or new ones.

(1)

When a company is dissolved due to expiration of the specified time period or upon a resolution of the competent company organs, they may decide to continue its activities, unless the distribution of assets has commenced.

(2)

A resolution pursuant to paragraph 1 shall be passed:

1.

in case of a joint stock company, by a majority of at least three quarters of the shares represented;

2.

in case of another company, unanimously.

(3)

The liquidators shall file the resolution to continue the company for registration in the Commercial Register.

---

Next: COMMERCIAL GROUPS
Up: TYPES OF MERCHANTS
Previous: Section II Special Provisions