Common use of Loan to Fund by Shareholder Clause in Contracts

Loan to Fund by Shareholder. If any Shareholder shall, in addition to his Capital Contribution to the Fund, lend any monies to the Fund, the amount of any such loan shall not increase his Capital Account nor shall it entitle him to any increase in his share of the distributions of the Fund, but the amount of any such loan shall be an obligation on the part of the Fund to such Shareholder and shall be repaid to him on the terms and at the interest rate negotiated at the time of the loan, and the loan shall be evidenced by a promissory note executed by the Fund except that no Shareholder shall be personally obligated to repay the loan, which shall be payable and collectible only out of the assets of the Fund.