The ongoing dispute between Sunlit Technology directors David Wu and Paul Johnson has creditors sweating over debt repayments.
George Skaf, NSW state manager of distributor Digiland, claims the company is considering taking legal action against the directors which would see Sunlit thrown into liquidation.
"We believe there is an issue with Sunlit, and we're trying to retrieve as much stock as possible," Skaf told ARN. "We've been struggling to get payment out of them for some time."
Although Skaf would not reveal how much Sunlit owes Digiland, he said it was substantial enough for Digiland to consider taking legal action to have the company wound up.
"[Sunlit] is a reasonably sized debtor of ours," said Skaf. "Someone should wind them up, and I think it might have to be us."
Not all of Sunlit's creditors are of the same opinion. Bob Tang, financial director of distributor Synnex, said that while he's concerned about whether his company will be paid, he believes that forcing Sunlit into liquidation could mean unsecured creditors receive less than if the company kept trading.
He hopes the company can resolve its directorial dispute and continue trading. "That would be the best for all of us at the moment," said Tang.
It's a result Sunlit director Wu is pushing for, claiming that if creditors were to "panic" and force the company into liquidation, then they would be paid a fraction of their full debt.
"I can't liquidate right now. If [administrators] got hold of [Sunlit], they would sell stock at auction prices and creditors will get 20 cents in the dollar," Wu told ARN.
Co-director Johnson said he does not know the true state of Sunlit's financial position, but welcomes the possibility of a forced liquidation.
He claims Wu and Wu's wife, Dianne, control supply agreements and accounts, including keying in all of the invoices to their accounting system. Johnson said that he was originally refused access to the financial accounts, and that when he was given access he questioned their validity.
"I'm not an accountant. That's why I've wanted a professional CPA to do an audit from the beginning. But there were just so many conflicting [statements] in the information I was given," he said.
Wu claims Johnson had equal access to the company's financial records before they agreed to split.
Johnson believes a forced liquidation would result in an independent audit of the company and its remaining stock.
"I have no idea how much creditors are owed. I want to find out. All I want is for an independent auditor to come in and assess the financial position of the company.
"We [Wu and Johnson] did agree for a person to go in to take an objective view of the company that I'd pay for, but when the accountant turned up [Wu] locked him out," Johnson said.
Wu said he refused to allow the auditor to look at the accounts because he believed the accountant was a family friend of Johnson. Johnson said this was not the case.