Texas § BO.153.202 - ENFORCEABILITY OF PROMISE TO MAKE CONTRIBUTION

§ BO.153.202. ENFORCEABILITY OF PROMISE TO MAKE CONTRIBUTION

ENFORCEABILITY OF PROMISE TO MAKE CONTRIBUTION. (a) A promise by a limited partner to make a contribution to, or pay cash or transfer other property to, a limited partnership is not enforceable unless the promise is in writing and signed by the limited partner. (b) Except as otherwise provided by the partnership agreement, a partner or the partner's legal representative or successor is obligated to the limited partnership to perform an enforceable promise to make a contribution to or pay cash or transfer other property to a limited partnership, notwithstanding the partner's death, disability, or other change in circumstances. (c) If a partner or a partner's legal representative or successor does not make a contribution or other payment of cash or transfer of other property required by the enforceable promise, whether as a contribution or with respect to a contribution previously made, that partner or the partner's legal representative or successor is obligated, at the option of the limited partnership, to pay to the partnership an amount of cash equal to the portion of the agreed value, as stated in the partnership agreement or in the partnership records required to be kept under Sections 153.551 and 153.552 , of the contribution represented by the amount of cash that has not been paid or the value of the property that has not been transferred. (d) A partnership agreement may provide that the partnership interest of a partner who fails to make a payment of cash or transfer of other property to the partnership, whether as a contribution or with respect to a contribution previously made, required by an enforceable promise is subject to specified consequences, which may include: (1) a reduction of the defaulting partner's percentage or other interest in the limited partnership; (2) subordination of the partner's partnership interest to the interest of nondefaulting partners; (3) a forced sale of the partner's partnership interest; (4) forfeiture of the partner's partnership interest; (5) the lending of money to the defaulting partner by other partners of the amount necessary to meet the defaulting partner's commitment; (6) a determination of the value of the defaulting partner's partnership interest by appraisal or by formula and redemption or sale of the partnership interest at that value; or (7) another penalty or consequence. Acts 2003, 78th Leg., ch. 182, Sec. 1, eff. Jan. 1, 2006.