03/31/2026
ALERT: LLC Capital Contribution Provisions
Most people think if they own an LLC they have a liability protection shield. That their personal assets won't get harmed because of an LLC problem.
I.e. what most people expect - if things go bad they won't have to put more money into the LLC.
BUT - I've seen LLC Agreements where there are provisions requiring more money to be added to the LLC by the Investors.
This can WIPE OUT all of the protection investors expect.
These provisions can be hidden and have unintended consequences.
I've seen a few of these in the last few months. Deals where an LLC was formed years ago and my law firm was brought in later for another issue. Then we find the historical issue buried.
Most investors want LIMITED LIABILITY.
So - check out those old LLC Agreements. Talk with your lawyer if needed.
This isn't the only potential GOTCHA in LLC Agreements. I can write more on that in future posts if you ask for it below by writing "MORE PLEASE".
Educational only. Not legal or financial advice. Consult with your attorney.
What else do you want to hear about? Let me know below!
