MICHIGAN LIMITED LIABILITY COMPANY ACT (EXCERPT)
Act 23 of 1993
450.4302 Promise by member to contribute; enforcement; obligation to perform; rights of company; compromising obligation; enforcement by creditor of original member's obligation.
(1) A promise by a member to contribute to the limited liability company is not enforceable unless the promise is in writing and signed by the member.
(2) Unless otherwise provided in an operating agreement, a member is obligated to the limited liability company to perform any enforceable promise to contribute cash or property or to perform services, even if the member is unable to perform because of death, disability, or other reason. If a member does not make the required contribution of property or services, the member is obligated, at the option of the limited liability company, to contribute cash equal to that portion of value of the stated contribution that is not made.
(3) The rights of the limited liability company under subsection (2) are in addition to any other rights that the limited liability company may have under an operating agreement or applicable law.
(4) Unless otherwise provided in an operating agreement, a member's obligation to make a contribution or to return money or other property paid or distributed in violation of this act may be compromised only upon the unanimous vote of the members of the limited liability company entitled to vote. Notwithstanding a compromise of a member's obligation, a creditor of a limited liability company who extends credit or otherwise acts in reliance on the member's obligation after the member signs a writing that reflects the obligation and before the amendment of the writing to reflect the compromise may enforce the member's original obligation.
History: 1993, Act 23, Eff. June 1, 1993
Am. 1997, Act 52, Imd. Eff. July 1, 1997
Am. 2010, Act 290, Imd. Eff. Dec. 16, 2010
© 2009 Legislative Council, State of Michigan