N.Y. Partnership Law § 102: Loans and other business transactions with limited partner

§ 102. Loans and other business transactions with limited partner. (1)

A limited partner also may loan money to and transact other business

with the partnership, and, unless he is also a general partner, receive

on account of resulting claims against the partnership, with general

creditors, a pro rata share of the assets. No limited partner shall in

respect to any such claim

(a) Receive or hold as collateral security any partnership property,

or,

(b) Receive from a general partner or the partnership any payment,

conveyance or release from liability, if at the time the assets of the

partnership are not sufficient to discharge partnership liabilities to

persons not claiming as general or limited partners.

(2) The receiving of collateral security, or a payment, conveyance or

release in violation of the provisions of subdivision one is a fraud on

the creditors of the partnership.