Real Estate JVs: Structuring Capital Call Provisions and Contribution Default Remedies

Strategies for Mitigating Legal, Operational and Tax Risks

Recording of a 90-minute premium CLE webinar with Q&A

Conducted on Thursday, April 23, 2015

Recorded event now available

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Program Materials

This CLE webinar will guide real estate counsel in structuring capital call provisions and default remedies in joint ventures that address the rights and obligations of the respective partners when one partner is unable to meet its capital obligation. The program will discuss some of the rules that might apply to these situations in the absence of specific language in the partnership agreement.

Description

At the outset of forming a real estate joint venture, we are often tasked with drafting partnership agreement provisions outlining the rights and obligations of the parties with respect to capital contributions. This requires client input on several fronts. For example, which of the partners may call for capital and under what circumstances, and what happens if less than all of the partners contribute their shares of a capital call?

Depending upon various factors, however, it can be complicated, contentious and time-consuming to thoroughly address all scenarios, and thus many partnership agreements may leave some things unsaid or otherwise subject to future resolution by the parties.

Listen as our authoritative panel of real estate practitioners discusses structuring capital call provisions and default remedies in real estate joint ventures to address rights and obligations of the respective partners when a capital call is made and one partner is unable to meet its obligation. The panel will also explain the operational, legal and tax implications of default remedies.

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Outline

  1. Capital call provisions
    1. Which partners may call for capital
    2. When are contributions required or permitted
    3. Tax issues with non-cash contributions
    4. Multi-tier and GP-LP structuring
    5. Enforcement by creditors
    6. Delaware LP/LLC Acts
  2. Contribution default remedies
    1. Priority treatment for contributing partner
    2. Dilution
    3. Other remedies
    4. Tax issues
    5. Multi-tier and GP-LP structuring
    6. Third-party considerations
    7. Delaware LP/LLC Acts

Benefits

The panel will review these and other key issues:

  • Defining initial contributions and circumstances for subsequent capital calls
  • Key rights and remedies for contribution defaults
  • Operational, legal and tax implications of default remedies

Faculty

Daniel B. Guggenheim
Daniel B. Guggenheim
Partner
Pircher Nichols & Meeks

Mr. Guggenheim's practice focuses on real estate financing, joint ventures, sales and acquistions. He...  |  Read More

Michael R. Ray
Michael R. Ray
Partner
Pircher Nichols & Meeks

Mr. Ray’s practice focuses on advising clients across various sectors in connection with commercial transactions...  |  Read More

Michael D. Soejoto
Michael D. Soejoto
Partner
Pircher Nichols & Meeks

Mr. Soejoto’s practice focuses on the federal income tax aspects of real estate transactions and real...  |  Read More

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