Common use of Operating Loans Clause in Contracts

Operating Loans. To the extent Additional Capital Contributions are not adequate to satisfy a Remaining Funding Deficit as reasonably determined by the General Partner, then upon written notice from the General Partner to the Partners that additional funds are necessary to pay such Remaining Funding Deficit and, subject to Section 7.4(f) (but not subject to Section 7.4(f) for a Capital Commitment Shortfall), the Partners will have the option, but not the obligation, to loan funds (“Operating Loan(s)”) to the Partnership as set forth in this Section 4.5. Unless otherwise agreed by the Partners, Operating Loans will bear interest at a floating rate per annum equal to the same benchmark rate (and compounded at the intervals as such benchmark rate) used for the primary third-party secured debt of the Partnership plus five percent (5%) (the “General Interest Rate”). If the Partnership does not have third-party secured debt at the time any Operating Loan is outstanding, then the General Interest Rate will be the prime rate (as reported in The Wall Street Journal) plus one percent (1%). Operating Loans will be repaid in full (both principal and interest) pursuant to Section 6.2 before any distributions are made to the Partners in their capacity as such pursuant to Section 6.3 but, for the avoidance of doubt, not before tax distributions are made to the Partners pursuant to Section 6.5. Operating Loans will be expressly subordinate to any third-party secured debt of the Partnership and will be treated as equity in the Partnership to the extent required by any third-party Lender to the Partnership. Partners making Operating Loans to the Partnership will execute and deliver any documents and agreements evidencing such subordination to the extent required by any third-party Lender to the Partnership.

Operating Loans. To the extent Additional Capital Contributions are not adequate to satisfy a Remaining Funding Deficit as reasonably determined by the General Partner, then upon written notice from the General Partner to the Partners that additional funds are necessary to pay such Remaining Funding Deficit and, subject to Section 7.4(f) (but not subject to Section 7.4(f) for a Capital Commitment Shortfall)Deficit, the Partners will have the option, but not the obligation, to loan funds (“Operating Loan(s)”) to the Partnership as set forth in this Section 4.5. Unless otherwise agreed by the Partners, Operating Loans will bear interest at a floating rate per annum equal to the same benchmark rate (and compounded at the intervals as such benchmark rate) used for the primary third-party secured debt of the Partnership plus five percent (5%) (the “General Interest Rate”). If the Partnership does not have third-party secured debt at the time any Operating Loan is outstanding, then the General Interest Rate will be the prime rate (as reported in The Wall Street Journal) plus one percent (1%). Operating Loans will be repaid in full (both principal and interest) pursuant to Section 6.2 before any distributions are made to the Partners in their capacity as such pursuant to Section 6.3 but, for the avoidance of doubt, not before tax distributions are made to the Partners pursuant to Section 6.5. Operating Loans will be expressly subordinate to any third-party secured debt of the Partnership and will be treated as equity in the Partnership to the extent required by any third-party Lender to the Partnership. Partners making Operating Loans to the Partnership will execute and deliver any documents and agreements evidencing such subordination to the extent required by any third-party Lender to the Partnership.