Common use of Failure to Make Capital Contribution Clause in Contracts

Failure to Make Capital Contribution. If any Partner fails to make any Capital Contribution required to be made by such Partner under Section 3.01 or Section 3.02 within 10 days after the same becomes due and payable (the “Defaulting Partner”), one or more of the other Partners (the “Contributing Partner”) may (but without obligation to do so), within 15 days after the expiration of said 10-day period, contribute to the Company an additional amount equal to the Defaulting Partner’s unpaid Capital Contribution and elect to treat such contribution as provided in either Section 3.03(a) or Section 3.03(b). If the Contributing Partner fails to make such election within said 15-day period, it shall be deemed to have elected to treat such contribution as provided in Section 3.03(b). (a) The Contributing Partner may treat such contribution as a loan to the Defaulting Partner (to be due and payable solely out of distributions otherwise payable to the Defaulting Partner hereunder) followed by a contribution of the proceeds thereof to the Company to fund the Capital Contribution otherwise required to be made from the Defaulting Partner. Until the loan to the Defaulting Partner shall have been repaid together with interest at the rate equal to the Prime Rate plus five percentage points, or the maximum rate permitted under applicable law, whichever is less, calculated upon the outstanding principal balance of such loan as of the first day of each month, all distributions otherwise to be made to the Defaulting Partner hereunder shall be distributed, for the Defaulting Partner’s account, by payment of the same to the Contributing Partner, and shall be applied against the balance owed by the Defaulting Partner to the Contributing Partner. (b) [The confidential material contained herein has been omitted and has been separately filed with the Commission.] (c) Any change in Percentage Interests pursuant to this Section 3.03(b) shall not affect the amount of any Partner’s Capital Contributions for purposes of determining the amount to which such Partner is entitled pursuant to Section 5.02(a), to the extent attributable to Section 5.02(a).

Appears in 3 contracts

Samples: Limited Partnership Agreement (Liberty Property Limited Partnership), Limited Partnership Agreement (Liberty Property Limited Partnership), Limited Partnership Agreement (Liberty Property Trust)

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Failure to Make Capital Contribution. If any Partner fails to make a capital contribution to the Partnership in the amount and by the Funding Date stated in the Funding Notice, the Partner contributing its share of cash in a timely manner (the "CONTRIBUTING PARTNER") has the right to undertake any Capital Contribution required to be made by such Partner under one of the actions set forth in this Section 3.01 or Section 3.02 within 10 3.5. Not later than thirty (30) days after the same becomes due and payable Funding Date, Contributing Partner shall deliver a written statement to the Partner which did not contribute its share of cash in a timely manner (the “Defaulting Partner”), one or more "NON-CONTRIBUTING PARTNER") of the other Partners (the “Contributing Partner”) may (but without obligation to do so), within 15 days after the expiration of said 10-day period, contribute to the Company an additional amount equal to the Defaulting Partner’s unpaid Capital Contribution and elect to treat such contribution as provided in either Section 3.03(a) or Section 3.03(b). If action the Contributing Partner fails has elected to make make. The written statement must specify the date (the "EFFECTIVE DATE") when such election within said 15-day period, it shall action will be taken or will be deemed to have elected been taken, which date may not be earlier than ten (10) days, nor later than forty-five (45) days, after such written statement has been given to treat such contribution as provided in Section 3.03(b)the Non-Contributing Partner. (a) MAKE A CONTRIBUTION ON BEHALF OF NON-CONTRIBUTING PARTNER. The Contributing Partner may treat such make a contribution as on behalf of the Non-Contributing Partner, in which event each Partner's Partnership Interest will be adjusted to a loan respective percentage determined by increasing the Contributing Partner's Partnership Interest by a percentage equal to the Defaulting Adjustment Fraction and decreasing the Non-Contributing Partner's Partnership Interest by the amount by which the Contributing Partner's Partnership Interest has been increased. As used in this Section 3.5(a), the "ADJUSTMENT FRACTION" is a fraction the numerator of which is the aggregate amount of all capital contributions made by the Contributing Partner (to be due and payable solely out of distributions otherwise payable to the Defaulting Partnership and the denominator of which is the aggregate amount of capital contributions made to the Partnership by all Partners. (b) MAKE A LOAN TO NON-CONTRIBUTING PARTNER. The Contributing Partner hereundermay loan cash (a "CONTRIBUTING PARTNER LOAN") followed by a contribution to the Non-Contributing Partner in an amount equal to the Non-Contributing Partner's share of the proceeds thereof capital contribution requested in the Funding Notice. The Contributing Partner Loan will be secured by the NonContributing Partner's Partnership Interest, will be nonrecourse to the Company to fund the Capital Contribution otherwise required to be made from the Defaulting Partner. Until the loan to the Defaulting Non-Contributing Partner shall have been repaid together with and will bear interest at the a rate equal to the Prime Rate Rate, plus five percentage pointsone percent (1%). Effective upon a Partner becoming a Non-Contributing Partner, or the maximum rate permitted under applicable law, whichever is less, calculated upon the outstanding principal balance of such loan as of the first day of each month, all distributions otherwise to be made to the Defaulting Non-Contributing Partner hereunder shall be distributed, for the Defaulting Partner’s account, by payment of the same grants to the Contributing Partner, Partner a security interest in its Partnership Interest to secure its obligation to repay such Contributing Partner Loan and shall be applied against the balance owed by the Defaulting agrees to execute and deliver such UCC-1 financing statements and assignments of certificates of membership (or other documents of transfer) as such Contributing Partner to the Contributing Partnermay reasonably request. (b) [The confidential material contained herein has been omitted and has been separately filed with the Commission.] (c) Any change in Percentage Interests pursuant to this Section 3.03(b) shall not affect the amount of any Partner’s Capital Contributions for purposes of determining the amount to which such Partner is entitled pursuant to Section 5.02(a), to the extent attributable to Section 5.02(a).

Appears in 1 contract

Samples: Partnership Agreement (Iac Capital Trust)

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Failure to Make Capital Contribution. (a) If any the Class A Limited Partner fails to make timely contribute all or any portion of any Capital Contribution required of such Class A Limited Partner pursuant to the provisions of Section 3.1 above, then such Class A Limited Partner shall be made by considered a "CLASS A DELINQUENT PARTNER." In such Partner under Section 3.01 or Section 3.02 within 10 days after event, the same becomes due and payable (Partnership may, upon notice to the “Defaulting Class A Delinquent Partner”), exercise either one or more of the other Partners following remedies as its sole remedy: (i) permit the “Contributing Partner”) may (but without obligation Class B Limited Partner to do so), within 15 days after advance that portion of the expiration of said 10-day period, contribute to the Company an additional amount equal to the Defaulting Partner’s unpaid required Capital Contribution and elect to treat such contribution that is in default as provided in either Section 3.03(aa loan (a "CLASS A DEFAULT LOAN") or Section 3.03(b). If with the Contributing Partner fails to make such election within said 15-day period, it following results: (A) the sum thus advanced shall be deemed to have elected to treat such contribution as provided in Section 3.03(b). (a) The Contributing Partner may treat such contribution as constitute a loan to the Defaulting Partner Class A Delinquent Partner; (to B) such loan and all accrued unpaid interest thereon shall be due and payable solely out of distributions otherwise payable to the Defaulting Partner hereunderon demand, or if no demand is made, twelve (12) followed by a contribution of the proceeds thereof to the Company to fund the Capital Contribution otherwise required to be made from the Defaulting Partner. Until months after such advance is made; (C) the loan to the Defaulting Partner shall have been repaid together with bear interest at the rate equal to the Prime Rate plus five percentage points, lesser of twelve percent (12%) per annum or the maximum highest rate permitted under by applicable law, whichever is less, calculated upon from the outstanding principal balance of such loan as of date made until the first day of each month, date fully repaid compounding monthly; and (D) all Partnership distributions and other payments that otherwise to would be made to the Defaulting Class A Delinquent Partner hereunder (whether before or after dissolution of the Partnership) under this Agreement (including those under Article 6) shall be distributedpaid to the Class B Limited Partner until the loan and all interest accrued thereon is paid in full (with all such payments being applied first to accrued and unpaid interest and then to principal and being deemed to be a distribution or payment (as may apply) to the Class A Delinquent Partner, for and, in turn, a payment by the Defaulting Class A Delinquent Partner with respect to the loan from the Class B Limited Partner’s account); or (ii) permit the Class B Limited Partner to contribute the Capital Contribution not made by the Class A Delinquent Partner as a Capital Contribution made by the Class B Limited Partner, by payment in which case the Class B Limited Partner shall have conferred upon it a Class A Limited Partnership Percentage, and there shall be a corresponding decrease in the Class A Limited Partnership Percentage of the same Class A Delinquent Partner, as follows: (A) the Class A Limited Partnership Percentage conferred upon the Class B Limited Partner immediately following such Capital Contribution shall be increased by an amount equal to 150% x A/B (expressed as a percentage)(up to a maximum of 100% of the Class A Limited Partnership Percentage owned by the Class A Delinquent Partner), where `A' equals the amount the Class B Limited Partner contributed in respect of the Class A Delinquent Partner's required Capital Contribution, and `B' equals the sum of all unreturned Capital Contributions previously made to the Contributing Partnership by the Class A Limited Partner after giving effect to the amounts advanced under this Section 3.3(a)(ii) on behalf of the Class A Delinquent Partner, ; and (B) the Class A Limited Partnership Percentage of the Class A Delinquent Partner shall be applied against the balance owed decreased by the Defaulting Partner to increase of the Contributing Class B Partner's Class A Limited Partnership Percentage. (b) [The confidential material contained herein has been omitted With respect to any efforts by the General Partner to obtain loans to the Partnership from a third party or a Partner (including the General Partner), the financing terms must be substantially similar to (or more favorable than) loans which the Partnership could obtain on a competitive arms-length basis. If the General Partner is unable to determine whether the financing terms are competitive on an arms-length basis, the General Partner may seek Approval by Partnership Vote on the issue, or may seek and has been separately filed with rely upon the Commission.] (c) Any change advice of an independent expert in Percentage Interests pursuant financing. If any Partner makes any loan or loans to this Section 3.03(b) shall not affect the Partnership or advances money on its behalf, the amount of any loan or advance shall not be treated as a Capital Contribution but shall be treated as a debt due from the Partnership to such Partner’s Capital Contributions for purposes of determining the amount to which such Partner is entitled pursuant to Section 5.02(a), to the extent attributable to Section 5.02(a).

Appears in 1 contract

Samples: Limited Partnership Agreement (Behringer Harvard Short Term Opportunity Fund I Lp)

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