Noncontributing Members Sample Clauses
The Noncontributing Members clause defines the rights and limitations of members in an organization or entity who do not make capital contributions. Typically, this clause clarifies that such members may have restricted voting rights, limited access to profits, or reduced participation in management decisions compared to contributing members. Its core function is to distinguish between members based on their financial input, ensuring fairness and transparency in governance and profit allocation.
Noncontributing Members. The Company will be entitled to enforce the obligations of each Member to make the contributions to capital specified in Sections 6.2 and 6.3 above, including the obligations of Agritope and Sunseeds to perform their assigned work under the Development and Marketing Agreement and submit invoices therefor, and the Company will have all remedies available at law or in equity in the event any such contribution is not so made. If any legal proceedings relating to the failure of a Member to make such a contribution are commenced, such Member shall pay all costs and expenses incurred by the Company, including attorneys' fees, in connection with such proceedings, but the payment of such costs and expenses shall not be treated as a capital contribution to the Company. Without limiting the foregoing remedies, if a Member fails to make a Capital Contribution within the time period set forth in Sections 6.2 above, then, at the election of a Majority in Interest of the other Members, the Company Percentage of the defaulting Member shall be reduced to zero (0) and the Company Percentages of the non-defaulting Members shall be increased by an equal amount and in proportion to their Company Percentages prior to the default. In addition, a defaulting Member whose Company Percentage has been so reduced to zero (0) shall no longer be entitled to receive distribution pursuant to this Agreement, except distribution as provided in Article XI upon dissolution of the Company.
Noncontributing Members. (a) If any Member shall fail to timely make, or notifies the other Member that it shall not make, all or any portion of any additional Capital Contribution which such Member is obligated to make under Section 3.01 to fully fund its Remaining Capital Commitment, then such Member shall be deemed to be a “Non-Contributing Member.” A Member that is not (i) a Defaulting Member or (ii) a Non-Contributing Member (a “Contributing Member”), shall be entitled, but not obligated, to loan to the Non-Contributing Member, by contributing to the Company on its behalf, all or any part of the amount (the “Default Amount”) that the Non-Contributing Member failed to contribute to the Company (each such loan, a “Default Loan”); provided, that such Contributing Member shall have contributed to the Company its pro rata share of the applicable required additional Capital Contribution. Such Default Loan shall be treated as an additional Capital Contribution by the Non-Contributing Member. Each Default Loan shall bear interest (compounded monthly on the first day of each calendar month) on the unpaid principal amount thereof from time to time remaining from the date advanced until repaid, at the lesser of (i) six percent (6%) per annum and (ii) the maximum rate permitted at law (the “Default Rate”). Each Default Loan shall be recourse solely to the Non-Contributing Member’s Membership Interest. Default Loans shall be repaid out of the distributions that would otherwise be made to the Non-Contributing Member under Section 6.01, Section 6.02 or ARTICLE XII, as more fully provided for in Section 3.02(c). So long as a Default Loan is outstanding, the Non-Contributing Member shall have the right to repay it (together with interest then due and owing) in whole or in part. Upon a repayment in full of a Default Loan made to a Non-Contributing Member (prior to its conversion pursuant to a Cram-Down Contribution in accordance with Section 3.02(b)), such Non-Contributing Member (so long as it is not otherwise a Non-Contributing Member with respect to any other additional Capital Contributions) shall cease to be a Non-Contributing Member.
(b) At any time after the date six (6) months after a Default Loan is made, at the option of the Contributing Member, (i) such Default Loan shall (if not previously paid in full) be converted into an additional Capital Contribution of the Contributing Member in an amount equal to the unpaid principal and unpaid interest on such Default Loan pursuant to this ...
Noncontributing Members. The Board, on behalf of the Company, shall be entitled to enforce the obligations of each Member (a “Noncontributing Member”) that fails to timely make its pro rata share (or any portion thereof) of a Required Capital Contribution (such unfunded amount, the “Deficiency Amount”). The Board will (or any other Member may) notify each Noncontributing Member in writing (a “Default Notice”) of any such failure to make a Required Capital Contribution, which Default Notice shall include the amount of such Noncontributing Member’s Deficiency Amount. If such Noncontributing Member fails to contribute such Deficiency Amount in full within ten (10) Business Days after receipt of such Default Notice, then, during the Default Period and in addition to any remedies available to the Company at law or in equity in the event US-DOCS\101960009.22 of any Deficiency Amount, the Board may elect to enforce one or more of the provisions of paragraph 3.3(a)(i), to which each Member hereby expressly consents: