Repayment through Distributions Sample Clauses
The "Repayment through Distributions" clause establishes that any amounts owed by a party, such as a loan or advance, will be repaid using distributions that the party is entitled to receive under the agreement. In practice, this means that instead of making separate payments, the owed amounts are deducted from profits, dividends, or other distributions before they are paid out. This mechanism streamlines the repayment process, ensuring that obligations are met automatically and reducing the risk of missed payments or defaults.
Repayment through Distributions. A Contribution Loan shall be repaid on a first priority basis out of any subsequent distributions to which the Non-Contributing Member for whose account the Contribution Loan was made would otherwise be entitled in accordance with this Agreement, which amounts shall be applied first to accrued interest and then to principal, until the Contribution Loan is paid in full. Each Non-Contributing Member irrevocably assigns its rights to distributions from the Company to the Contributing Member for the purpose of effectuating this repayment. Repayment of either Member's Contribution Loan shall also be secured by the Non-Contributing Member's Percentage Interest in the Company, and the Non-Contributing Member hereby grants a security interest in such Percentage Interest and all distributions related thereto to the Contributing Member who has advanced such Contribution Loan and hereby irrevocably appoints the Contributing Member, and any of its agents, officers or employees, as its attorney- in-fact, such appointment being coupled with an interest, to execute, acknowledge and deliver any documents, instruments and agreements including, but not limited to, any note evidencing the Contribution Loan, and such Uniform Commercial Code financing statements, continuation statements, and other security instruments or documents as may be appropriate to perfect and continue such security interest in favor of the Contributing Member.
Repayment through Distributions. In the event the Contributing Partner elects to make a Contribution Loan, then the Contribution Loan shall bear interest at a rate equal to the lesser of (a) the Prime Rate (as announced from time to time in The Wall Street Journal) plus four percent (4%) per annum, or (b) the maximum legal rate of interest then permitted under applicable law and, except as set forth in Section 2.3.3, shall be repaid out of any subsequent distributions made pursuant to this Agreement to which the Non-Contributing Partner for whose account the Contribution Loan was made would otherwise be entitled, which amounts shall be applied first to interest and then to principal, until the Contribution Loan is paid in full. If not sooner repaid, all Contribution Loans shall become immediately due and payable upon the dissolution and liquidation of the Partnership.
Repayment through Distributions. In the event a Stockholder elect to make a Contribution Loan, then the Contribution Loan shall bear interest at a rate equal to the grater of (a) the prime rate in effect from time to time at First Interstate Bank of Nevada, N.A., plus three (3) percentage points, or (b) eighteen percent (18%) and, except as set forth in subsection 5.1.5, shall be repaid out of any subsequent distributions made pursuant to this Agreement to which the noncontributing Stockholder would otherwise be entitled, which amounts shall be applied first to interest and then to principal, until the Contribution Loan is paid in full. Repayment of the Contribution Loan shall be secured by the noncontributing Stockholder's Shares, and each noncontributing Stockholder hereby grants a security interest in its Shares to the Stockholder(s) making the Contribution Loan and appoints such Stockholder(s), and any of its agents, officers or employees, as its attorneys-in-fact with full power and authority to prepare and execute any documents, instruments and agreements, including but not limited to, any Note evidencing the Contribution Loan, and such Uniform Commercial Code financing and continuation statements, and other security instruments as may be appropriate to perfect and continue such security interest.