Indiana § 23-18-5-2 Obligation to make capital contribution or other payment; compromise;
effect; remedies or consequences of nonpayment

Indiana Statutes

§ 23-18-5-2 — Obligation to make capital contribution or other payment; compromise; effect; remedies or consequences of nonpayment

Indiana·Title 23 BUSINESS AND OTHER ASSOCIATIONS·Art. 18 LIMITED LIABILITY COMPANIES·Ch. 5 Finance

(a)The obligation of a member to make a capital contribution or return money or other property paid or distributed in violation of this article may be compromised only:

(1)in compliance with a written operating agreement; or

(2)if a written operating agreement does not so provide, with the unanimous consent of the members.

(b)Any compromise does not affect the rights, if any, of any creditor of a limited liability company who, before the compromise, extends credit or acts in reliance on the obligation after the member signs a writing that reflects the obligation.

(c)An operating agreement may provide that a member who fails to make a capital contribution or other payment that the member is required to make is subject to specified remedies for or specified consequences of the failure.

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(a) The obligation of a member to make a
capital contribution or return money or other property paid or
distributed in violation of this article may be compromised only:
(1) in compliance with a written operating agreement; or
(2) if a written operating agreement does not so provide, with the
unanimous consent of the members.
(b) Any compromise does not affect the rights, if any, of any
creditor of a limited liability company who, before the compromise,
extends credit or acts in reliance on the obligation after the member
signs a writing that reflects the obligation.
(c) An operating agreement may provide that a member who fails to
make a capital contribution or other payment that the member is
required to make is subject to specified remedies for or specified
consequences of the failure. The remedy or consequence may include
the following form:
(1) Reducing the defaulting member's interest in the limited
liability company.
(2) Subordinating the defaulting member's interest in the limited
liability company to that of nondefaulting members.
(3) A forced sale of the defaulting member's interest in the limited
liability company.
(4) Forfeiture of the defaulting member's interest in the limited
liability company.
(5) A loan by the nondefaulting members of the amount necessary
to meet the commitment.
(6) A determination of the value of the member's interest in the
limited liability company by appraisal or by formula and
redemption and sale of the defaulting member's interest in the
limited liability company at that value.

Indiana § 23-18-5-2 (Obligation to make capital contribution or other payment; compromise; effect; remedies or consequences of nonpayment) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.