- 19 - Assuming that MTT defaulted on its lease obligations under its end-user lease and that MHLC commenced collection efforts that broke the circle of payments (or accounting entries) between F/S Computer, F.S. Venture, and Petunia jeopardizing Petunia’s ability to make payments due on its debt to F.S. Venture, before any liability of the limited partners would be triggered, FSC would have been required to honor its obligations under the Guaranty Agreement, thereby providing funds needed by Petunia to pay F.S. Venture. FSC, through its guaranties--not the limited partners of Petunia--would be required to provide funds (or accounting entries) necessary to keep payments current on the debt obligations of Petunia. The obligations of FSC and F/S Computer under the Guaranty and Commitment Agreements, the suspension and setoff provisions under the purchase agreement between F.S. Venture and Petunia, the fact that F.S. Venture and Petunia did not assume Alanthus’ recourse promissory note to MHLC, the provisions of the Side Agreement (to which MHLC itself was a party) that expressly immunized Petunia from any liability on Alanthus’ recourse promissory note to MHLC, and the matching payments under the various essentially offsetting obligations effectively immunized Petunia from any realistic possibility for loss in connection with the transaction in issue. Petitioner suggests a scenario under which FSC would not honor its guaranties, and petitioner suggests that under thatPage: Previous 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 Next
Last modified: May 25, 2011