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Was not Apple incorporated as a limited liability company which limits your losses?
by spacecowboy_lon 11y ago
Was not Apple incorporated as a limited liability company which limits your losses?
- TheBiv 11y agoI don't know the specifics, but it may not have been officially incorporated yet.
- linkregister 11y agoVery often lenders will refuse to issue loans to the LLC, instead requiring company officers to take loans out in their name so a lender can be made whole in the event of default.
- manarth 11y agoIt's very common with "Close companies" (companies that are owned and run by a small number of people) that banks require the directors/owners to act as a personal guarantor on company loans. Without that, it would be quite legal for the directors to take a whopping loan, pay themselves a whopping salary/bonus, then have the company go bankrupt without recourse to the bank. Rinse, repeat, profit.
- dboreham 11y agoYou're talking about PE firms, right?
- CamperBob2 11y agoRinse, repeat, profit. That "repeat" part is where this plan goes off the rails. You can fool your creditors once, but then the word gets around.
- kevin_thibedeau 11y agoUnless you're Trump.
- marme 11y agothat is the whole reason he walked away from the company. Jobs refused to fill out all the paperwork to form a corporation. They were running the company as a partnership which left all the members liable for everything the business did. It was not just the bank loans that were the worry. It was the contracts they were signing, if they failed to deliver the owners could personally have been sued for breach of contract