Legal Question in Business Law in Nevada

I am a partner in a Nevada LLC. I am about to withdraw from the business and partnership. The problem is that several months we bought a piece of equipment with a loan and it has my name and my parter as personal guarantors. The loan company said they cannot/will not remove my name as guarantor even if I withdraw from the LLC. I will still be liable if my partner defaults on the equipment loan. Is there a contract/agreement that I can have my partner sign stating that if he defaults on the equipment, I can take ownership of the equipment it to sell it in order to pay off the loan?


Asked on 12/28/23, 12:26 am

3 Answers from Attorneys
Frank Natoli Natoli-Legal, LLC

Sure, what you want is for the partner to provide an indemnification and personally guarantee your obligation on the loan. Whether the equipment can be transferred depends. If so, then you can condition that in the event of default, perhaps missing two consecutuve months, then the LLC will sell the equipment and satisfy the loan holding the partner liable for any shortfall.

If you would like to discuss further over a free phone consult, feel free to contact me anytime that is convenient.

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Answered on 12/28/23, 10:09 am
Richard Bryan Richard Bryan Attorney PC

You can certainly have an agreement between you and your partner and the partnership regarding protecting you, but at the end of the day you signed the guarantee and no paper in the world is going to prevent the lender from coming after you if it comes to that. The agreement between you and your partner is binding on the lender.

Good luck.

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Answered on 12/28/23, 12:33 pm
Richard Bryan Richard Bryan Attorney PC

I see I made a typo in my answer of 12/28/23: the agreement between you and your partner will NOT be binding on the lender.

Sorry about that.

Good luck.

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Answered on 12/29/23, 8:16 pm


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