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Newsletter

Enforceability of (Debt) Capital Commitments

17 February 2016
Mayer Brown Newsletter
A subscription credit facility (a “Facility”) is an extension of credit by a bank, financing company, or other credit institution (each, a “Lender”) to a closed end real estate or private equity fund (the “Fund”). The defining characteristic of such a Facility is the collateral package securing the Fund’s repayment of the Lender’s extension of credit, which is composed of the unfunded commitments (equity or debt “Capital Commitments”) of the limited partners to the Fund (the “Investors”) to make capital contributions (“Capital Contributions”) when called upon by the Fund’s general partner, not the underlying investment assets of the Fund itself.

Authors

  • Zachary K. Barnett
    T +1 312 701 8841
  • Rue K. Toland
    Associate
    T +1 312 701 8975
  • Matthew A. McDonald
    T +1 312 701 8321

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