Indemnification for Members and Managers of LLCs Presentation

The other presentation I did for NPRRA in Santa Fe, NM was on indemnification of Members and Managers in LLCs. The presentation is below.

Indemnification is an important concept and is contained in many contracts. However, many business owners do not really know how they work. I presented a series of posts not long ago on the topic starting with What is this Indemnification Provision in my Contract?.

If you have any questions regarding indemnification, or regarding drafting and reviewing contracts […]

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Advance Payment, Indemnification, and the Single-Member LLC

The Colorado statues provide that an limited liability company (LLC) member is entitled to be reimbursed for expenses incurred for the company. LLCs can also provide their members, managers, officers, employees, agents, and so on with indemnification for liabilities they incur for the company. While there are limits to the indemnification that can be provided, because LLCs are contractual entities, the indemnification generally has to be granted within the Operating Agreement.

The first thing to keep in mind is that this […]

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Indemnification and Advance Payment

Reimbursed at the End

Indemnification obligations do not arise until there is some determinable amount that a party is obligated to indemnify. The fact that a party has an indemnification right does not mean they will get reimbursed for their expenses or losses (especially defense costs and attorney fees) until after there is an actual out-of-pocket expense that is found to be covered by the contract language. In other words, you do not get reimbursed until the end.

Example in Corporate Setting

An […]

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Indemnification versus Defense Obligations

Indemnification is the obligation to pay another for a future liability that might arise. When included in a commercial contract, this usually includes coverage of liability in the form of actual damages or losses such as having to pay a third party. In addition, such provisions often include coverage for liability in the form of defense costs, i.e., the cost of dealing with a third party claim even if there is no ultimate liability to the third party. Notably, in […]

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What is this Indemnification Provision in my Contract?

Definition

Indemnification is the action of protecting (someone) by promising to pay for the cost of possible future damage, loss, or injury. In a contract setting, it is a provision where one party promises to pay the costs of potential future liabilities incurred by the other party as a result of some defined set of circumstances that might occur because of the contractual arrangement.

Examples

The most common example of an indemnification agreement is an insurance policy. In an insurance policy contract, […]

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Douglas Griess Pleased to Work with National Business Institute (NBI) to Present Parts of “Indemnification and LLCs” CLE on November 25, 2014.

Nationally recognized provider of continuing legal education courses, National Business Institute (NBI),  is providing a video webcast course on Indemnification and LLCs on November 25, 2014. NBI invited Douglas Griess to present on several of the topics, which he agreed to do.

Indemnification is an important issue for members, managers, and others within LLCs. In short, few want to take a job with an LLC unless the LLC will cover them for the liabilities they might incur doing their job […]

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