Defaulting during capital call: what happens?
Hi, folks. It looks like there's a mandatory capital call forthcoming in a project I'm an LP in. I can't contribute more money at this time so have no choice but to be in "default".
Besides not being able to collect distributions, if the project goes under, will I at least be entitled to my original investment amount if there are funds left over to return investor capital?
This is the language in the company agreement:
" a Defaulting Member shall be entitled only to the return of the balance in the Member’s Capital Account without any interest thereon."