1. A person’s obligation to make a contribution to a limited liability company is not excusedby the person’s death, disability, termination, orother inability to perform personally. 2. If a person does not fulfillan obligation to make a contribution other than money, the person is obligated at the option of the limited liability company to contribute money equal to the value of the part of the contribution which has not been made. 3. The obligation of a person to make a contribution may be compromised only by the affirmative vote or consent of allthe members. If a creditor of a limited liabilitycompany extends credit or otherwise acts inreliance onan obligation described in subsection 1 without knowledge or notice of a compromise under this subsection, the creditor may enforce the obligation. 4. An operating agreement may provide that the interest of any member who fails to make a contribution that the member is obligated to make is subject to specified penalties for,or specified consequences of, such failure. The penalty or consequence may take the form of reducing or eliminating the defaulting member’s proportionate interest in a limited liabilitycompany, subordinating the member’s interest to that of a nondefaulting member, a forced sale of the member’s interest, forfeiture of the member’s interest, the lending by other members of the amount necessary to meet the member’s commitment, a fixing of the value ofthe member’s interest by appraisal or by formula and redemption, or sale of the member’s interest at such value or other penalty or consequence.
‹ Prev All Iowa sections Next ›
Lexace provides legal information, not legal advice, and no attorney–client relationship is created. Statute text is provided for general information and may not reflect the most recent amendments; verify against the official state code.