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BizLawyerNate, Attorney
Category: Business Law
Satisfied Customers: 10686
Experience:  7 Years of Legal Experience Representing Small Business Owners
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I am working on a deal with a private investor who plans to

Customer Question

I am working on a deal with a private investor who plans to invest a sum of money over the next 12 months in monthly payments in exchange for a ownership percentage in my company. they are requesting that we modify the LLC documents to reflect the total ownership prior to the total contributions coming in. this is OK with me, however i need to know how to protect the equity position they will be given and how to make sure I hold them accountable and guarantee that my company receives the investment dollars regardless of the company's performance. this needs to be a definitive guarantee of funding. What do I need to do to protect my company and collect on the funding if they decide to default on their commitment.
Submitted: 6 years ago.
Category: Business Law
Expert:  BizLawyerNate replied 6 years ago.

Thank you for your question and welcome to Just Answer.


You need to have them sign an investment contract with the payment schedule and the resulting ownership they will have obtained once the 12 payments have been completed. You can stipulate that the investment is required regardless of the financial performance of the LLC during the period the payments are due.


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Nathan Moore