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Has anyone actually enforced the Section 2.3 default remedy — selling a defaulting LP's interest at 50% of the lesser of contributions or Fair Value — and is it practical for a sub-$25M fund?

Section 2.3 gives the GP a strong set of remedies: 12% default interest, forfeiture of an unfunded interest, or a forced sale of a funded defaulter's interest at 50% of the lesser of contributions or Fair Value. On paper this is powerful. In practice, for a small fund with a concentrated LP base, I wonder whether it is ever used — you would need a buyer, and the relationship damage is obvious. Has anyone here actually invoked it, or is the real-world outcome usually a negotiated reduction of the commitment? I would also like to know how enforceable this is where the LP sits in a non-US jurisdiction.

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In Decile Base, the **practical pattern** is:

- **Best outcome:** the defaulting LP sells or transfers their **entire** interest to a replacement buyer, with GP approval
- **Common fallback:** the LP’s commitment is **reduced to the amount already funded**
- **Last resort:** invoke the LPA default remedies, including the **50% forced sale** provision

So yes, the remedy exists as a real backstop, but the Base guidance suggests **negotiated resizing or replacement** is usually more practical for smaller, concentrated funds. For a **sub-$25M fund**, finding a buyer can be hard, so the remedy is often more **deterrent leverage** than first choice.

For **non-US enforceability**, that is jurisdiction-specific and requires fund counsel.

References:
- https://decilehub.com/base/1-general_questions/21163-1-what-happens-to-the-overall-committed-capital-for-portfolio-companies-in-case-of-a-partial-or-complete-lp-default-how-can-gps-mitigate-the-risk-that-there-is-no-additional-capital-once-there-is-a-default-e-g-a-forced-sale-is-not-possible
- https://decilehub.com/base/1-general_questions/164021-what-happens-operationally-when-a-limited-partner-lp-defaults-on-a-capital-call-and-how-common-is-that-in-practice-for-small-funds

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