Common use of Liability of Partners and Investors A Clause in Contracts

Liability of Partners and Investors A. Except as provided in the Act, the Limited Partners and Investors shall be liable only to pay their Capital Contributions and no Limited Partner or Investor will be personally liable for the debts, liabilities, contracts, or other obligations of the Fund. In accordance with Section 17-608 of the Act, (i) if a Limited Partner or an Investor has received the return of any part of his Capital Contribution in violation of the Agreement or the Act, he shall be liable to the Fund for a period of six years thereafter for the amount of the Capital Contribution wrongfully returned, (ii) if without violating this Agreement or the Act, a Limited Partner or an Investor receives a return of any part of his Capital Contribution, then he shall be liable to the Fund for a period of one year thereafter for the amount of the returned contribution, but only to the extent necessary to discharge liabilities to creditors who extended credit to the Fund during the period the Capital Contribution was held by the Fund and (iii) a Limited Partner or Investor receives a return of his Capital Contribution to the extent that a distribution to him reduces his share of the fair market value of the net assets of the Fund below the agreed value of his Capital Contribution that has not been distributed to him. B. Except as set forth in 3.4A, no Limited Partner or Investor shall be required to lend any funds to the Fund or, after his Capital Contribution has been fully paid, to make any further capital contribution to the Fund, nor shall any Limited Partner or Investor be liable for or have any obligation to restore any negative balance in his Capital Account. C. Subject to the provisions of Sections 3.1 and 5.9 of this Agreement, no General Partner shall have any personal liability for the repayment of the Capital Contribution or the Preferred Return of any Limited Partner or Investor or be required to repay to the Fund all or any portion of any negative balance of the Capital Accounts of the Limited Partners or the Investors. D. The funds advanced by the Development General Partner under the Cash Flow Deficit Guaranty Agreement shall not constitute a Capital Contribution of the Development General Partner or be credited to the Capital Account of the Development General Partner.