The Costs and Issues Involved in Winding Up a CRC 21 May 2014 Peter - PowerPoint PPT Presentation

The Costs and Issues Involved in Winding Up a CRC 21 May 2014 Peter Zurzolo

FFI CRC Wind Up Process started in Mid 2011 Board established the Transition Strategy Working Group It developed the terms of reference and 6 guiding principles Board took ownership of the process Regular Board agenda item Then undertook a roadshow to all Participants to understand their expectations 2

FFI CRC Wind Up – where we are today Board is recommending to Members to undertake a voluntary liquidation of the company Company will cease to exist Slightly more onerous/costly than deregistration IP to be assigned to one, two or three Participants Based on level of involvement/investment Ensured legacy maintained Wind Up Deeds almost ready for signing 3

Talk to others, learn from their experience This CRC was fortunate One Board member has been through a few CRC wind ups Experienced lawyer But what really got us started Talking to Cotton CRC Copy of their wind up Schedule Costings, unusual items Hurdles and issues they had experienced Participant behaviour (we have common Participants) 4

Key Learnings Talk to others, learn from their experience Start early involve your Board, Participants & staff Participants heavily consulted – no surprises Develop a detailed wind-up schedule that deals with large and small items Identify task and the person responsible Get invoices, milestones & in-kind early. 5

Key Learnings Get IP in order FFI CRC completed two IP audits Budget for three months extra Consider what staff are needed Legal cost will go up Identify risks and include on risk framework Contracts not executed in timely manner IP not properly identified IP not assigned to correct party 6

Staff Retention Retention/severance payments only strong motivator as you get close to the end Legacy event was important to the CRC Training Increased budget (doubled) Non-business related training supported Motivation Staff need to own the process We had monthly then fortnightly and now weekly meetings with our schedule 7

Costs – Wind Up costs last 15 months Severance or retention bonus Insurance run out ($50k) Liquidator costs ($15k) We included contingency Legal fees ramp up Training budget increased Legacy events Vanity publication – FFI CRC didn’t do this but last edition of magazine was double normal size 8

Costs – Wind Up costs last 15 months IP audit (if external) IP valuations (if external) Staff motivation program Staff remaining post 30 June Board fees post CRC (3 months in our case) Board size reduced at FFI CRC post CRC FFI CRC developed a scholarship fund Approved by Commonwealth Funds to aid transition 9

Wind Up Deed Wind Up Deed 16 Participants all with their own internal policies and agendas Start early Term sheet worked for us ??? Telcon Get Participants and their lawyers involved I took a position in negotiations 10

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