Ask an Expert
Closing out a business
Expert: Tony Frost
I was forced to cease operations of a small business a few months ago. What do I have to do to close out the business so that investors can claim their losses. I am in Ontario.
Tony Frost answered:
I am assuming that your "investors" intended to make loans to your business rather than injecting capital for the purpose of buying shares or assets.
If this is the case, you can document by letter to your lenders that the funds were received and will not be paid back. This should put the lenders in a position to claim the losses. Other steps in "closing" the business will vary depending on whether or not a company structure is involved.
About the author
Tony Frost is a litigation, commercial and estate lawyer with Mills & Mills LLP located at Yonge and St. Clair in Toronto. Click here for Tony's Profile.