Common use of Contribution Default Loans Clause in Contracts

Contribution Default Loans. Each Contribution Default Loan shall be recourse solely to the Defaulting Member’s Units. Contribution Default Loans (i) shall be repaid out of the Distributions that would otherwise be made to the Defaulting Member pursuant to this Agreement, and (ii) shall be deemed paid and applied on behalf of such Defaulting Member (A) first, to accrued and unpaid interest on all Contribution Default Loans (in the order of their original maturity date), (B) second, to the principal amount of such Contribution Default Loans (in the order of their original maturity date) and (C) third, to any Additional Capital Contribution of such Defaulting Member that has not been paid and is not deemed to have been paid. So long as a Contribution Default Loan is outstanding, the Defaulting Member shall have the right, at any time, to repay the Contribution Default Loan (and all accrued interest thereon) in whole or in part and without penalty. Upon the repayment in full of all Contribution Default Loans (but not upon their conversion as provided in this Article made in respect of a Defaulting Member (and so long as the Defaulting Member is not otherwise a Defaulting Member), such Defaulting Member shall cease to be a Defaulting Member.