(a) A person‘s obligation to make a contribution to a limited partnership is not excused by the person’s death, disability, termination, or other inability to perform personally.
Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
Partnership: A voluntary contract between two or more persons to pool some or all of their assets into a business, with the agreement that there will be a proportional sharing of profits and losses.
Person: means an individual, business corporation, nonprofit corporation, partnership, limited partnership, limited liability company, cooperative association, unincorporated nonprofit association, statutory trust, business trust, common-law business trust, estate, trust, association, joint venture, public corporation, government or governmental subdivision, agency, or instrumentality, or any other legal or commercial entity. See Tennessee Code 61-3-101
Property: means all property, whether real, personal, mixed, or tangible or intangible, or any right or interest in such property. See Tennessee Code 61-3-101
Required information: means the information that a limited partnership is required to maintain under §. See Tennessee Code 61-3-101
(b) If a person does not fulfill an obligation to make a contribution other than money, the person is obligated at the option of the limited partnership to contribute money equal to the value, as stated in the required information, of the part of the contribution that has not been made. The foregoing option is in addition to, and not in lieu of, any other rights, including the right to specific performance, that the limited partnership may have against the partner under the partnership agreement or applicable law.(c) A conditional obligation of a partner to make a contribution or return money or other property to a limited partnership shall not be enforced unless the conditions to the obligation have been satisfied or waived as to or by the partner. Conditional obligations include contributions payable upon a discretionary call of a limited partnership or a general partner prior to the time the call occurs.(d) The obligation of a person to make a contribution may be compromised only by the affirmative vote or consent of all the partners. If a creditor of a limited partnership extends credit or otherwise acts in reliance on an obligation described in subsection (a) without knowledge or notice of a compromise under this subsection (d), the creditor may enforce the obligation to the extent that, in extending credit, the creditor reasonably relied on the obligation of a partner to make a contribution.(e) A partnership agreement may provide that the interest of any partner who fails to make any contribution that the partner is obligated to make is subject to specified penalties for, or specified consequences of, the failure. The penalty or consequence may take the form of:
(1) Reducing or eliminating the defaulting partner’s proportionate interest in the limited partnership;(2) Subordinating the defaulting partner’s partnership interest to that of nondefaulting partners;(3) A forced sale of the defaulting partner’s partnership interest;(4) Forfeiture of the defaulting partner’s partnership interest;(5) The lending by other partners of the amount necessary to meet the defaulting partner’s commitment;(6) A fixing of the value of the defaulting partner’s partnership interest by appraisal or by formula and redemption or sale of the defaulting partner’s partnership interest at such value; or(7) Other penalty or consequence.
