b'How to Legally Raise Private Moneyfor the acts of the company; and 2) to create a structure where multiple individuals can operate as a single entity.Liability generally means an obligation to pay debts. Personal liability means you remain personally liable for any debt incurred. If you sign a personal guarantee in a promissory note, you are promising to remain personally responsible for the debt incurred regardless of whether the investment is successful. When a limited liability entity owns assets, as long as no one signs a personal guarantee, only the assets of the entity are subject to attachment if someone obtains a judgment against the company. This protects the outside assets owned by the participants in the company and is some-times called the corporate veil. The corporate veil acts as a shield in the event a limited liability com-pany gets sued by a third party. If your business is run in accordance with the laws of the state in which it was formed, and the management acts within the boundaries set forth in its governing documents, management and the owners may be protected from individual or personal responsi-bilityfor the companys debts for activities performed by the company or by individuals acting within their management authority on behalf of the company. As long as the corporate veil remains intact, the individuals who man-age the company will not be held personally liable for the companys debts or obligations. The corporate veil does not shield individuals who perform any illegal act, or anyone acting in the name of the company outside of the authority granted in the companys governing documents. Another exception to any limited liability entity is where a principal of the entity has engaged in a wrongful act such as fraud, misrepresentation, deceit, theft, or securities violations, in which case there is no limited liability. Outside or personal assets of the offender could become subject to attachment. In some cases, such as theft or embezzlement, criminal prosecution may result. All legal entities can provide this corporate veil protection as long as they are operated correctly and with the correct formation and governing documents in place. 72'