Substituted Partners Clause Samples
The Substituted Partners clause defines the process by which a new partner may be admitted to a partnership in place of an existing partner who is withdrawing or transferring their interest. Typically, this clause outlines the conditions under which substitution is permitted, such as requiring the consent of remaining partners or compliance with certain legal or financial requirements. Its core function is to ensure a smooth transition of partnership interests, maintaining continuity of the partnership while protecting the rights and interests of both existing and incoming partners.
Substituted Partners. Except as otherwise explicitly provided for in Section 6.1(b) and Section 6.2(b), a transferee of any general or limited partnership interest in the Partnership may become a substituted General Partner or Limited Partner (as the case may be) in place of the transferor only upon the written consent of the General Partner. The General Partner or its Affiliates shall have the right to be a Limited Partner or to become a substituted Limited Partner. Unless a transferee of any Partnership interest of a Partner becomes a substituted General Partner or substituted Limited Partner in accordance with the provisions of this Agreement, such transferee shall not be entitled to any of the rights granted to a Partner hereunder other than the right to receive all or part of the share of the income, gains, losses, deductions, expenses, credits, distributions, or returns of capital to which his or its transferor would otherwise be entitled with respect to the Partnership interest so transferred.
Substituted Partners. (a) No Partner shall have the right to substitute in its place a purchaser, assignee, transferee, donee, heir, legatee or other recipient of all or any portion of the Partnership Interest of such Partner. Any such purchaser, assignee, transferee, donee, legatee, distributee or other recipient of an interest shall be admitted to the Partnership as a substituted Partner only with the consent of each of the Partners, which consent may be granted or withheld by any Partner in it sole discretion.
(b) No person shall become a substituted Partner until such person has satisfied the requirements of this Article 6; provided, however, that for the purpose of allocating Profits, Losses and other items and distributing cash available for distribution, a person shall be treated as having become, and as appearing in the records of the Partnership as, a Partner, as the case may be, on such date as the sale, assignment or transfer to such person was recognized by the Partnership pursuant to Section 6.3.
Substituted Partners. Unless otherwise provided in this Agreement, an assignee of a Partner may become a substituted partner only with the consent of the General Partner and compliance with any other requirements of the Act (other than any that require a different consent of Partners).
Substituted Partners. No assignee of the whole or any portion of a Limited Partner's interest in the Partnership shall have the right to become a substituted Limited Partner in place of his or her assignor, unless (i) such assignor shall designate such intention in the instrument of assignment; (ii) the assignment instrument shall be in form and substance satisfactory to the General Partners; (iii) the assignor and assignee named therein shall execute and acknowledge such other instrument or instruments as the General Partners may deem necessary or desirable to effectuate such admission, including but not limited to a power of attorney with provisions more fully described in this Agreement; (iv) the assignee shall accept; adopt and approve in writing of all of the terms and provisions of this Agreement, as the same may have been amended; and (v) the written consent of the General Partners to the substitution (which consent shall be given unless in the written opinion of the Partnership's tax counsel such consent should be withheld to preserve the tax status of the Partnership) if the substituted Limited Partner is not the transferring Limited Partner's spouse, ancestor, lineal descendent or trust for the benefit of such person(s).
Substituted Partners. (a) Partners who assign all their Interests pursuant to an assignment or assignments permitted under this Agreement shall cease to be Partners of the Partnership except that unless and until a Substituted Partner is admitted in its stead, the assigning Partner shall not cease to be a Partner of the Partnership under the Act and shall retain the rights and powers of a member under the Act and hereunder, provided that such assigning Partner may, prior to the admission of a Substituted Partner, assign its economic interest in its Interest, to the extent otherwise permitted under Article 9. Any Person who is an assignee of any portion of the Interest of a Partner and who has satisfied the requirements of Article 9 shall become a Substituted Partner only when (i) the Administering General Partner has entered such assignee as a Partner on the books and records of the Partnership, which the Administering General Partner is hereby directed to do upon satisfaction of such requirements, and (ii) such assignee shall have paid all reasonable legal fees and filing costs in connection with the substitution as a Partner except as otherwise provided in Section 9.1(a).
(b) Any Person who is an assignee of any of the Interest of a Partner but who does not become a Substituted Partner and desires to make a further assignment of any such Interest, shall be subject to all the provisions of this Article 9 to the same extent and in the same manner as any Partner desiring to make an assignment of its Interest.
Substituted Partners. No transferee of a transferred Limited Partner Interest shall be admitted as a Limited Partner ("Substituted Partner") until each of the following conditions has been satisfied:
(a) the Board of Directors approves of such action by written consent, which may be withheld or granted in the sole and absolute discretion of the Board of Directors;
(b) the execution and delivery to the Partnership of a counterpart of this Agreement by the Substituted Partner or its agent or attorney-in-fact;
(c) receipt by the Partnership of other written instruments reasonably necessary to complete the transfer that are in form and substance satisfactory to the Board of Directors (as determined in its sole and absolute discretion);
(d) payment by the Substituted Partner to the Partnership of an amount determined by the Board of Directors to be equal to the costs and expenses incurred in connection with such assignment, including, without limitation, costs incurred in preparing and filing such amendments to this Agreement as may be required;
(e) the updating of the books and records of the Partnership and Schedule A hereto as soon as reasonably practicable to reflect the Person's admission as a Substituted Partner;
(f) if required by the Board of Directors in its sole and absolute discretion, execution and affirmation to an instrument by the terms of which such Person acknowledges that the relevant transfer of Interests have not been registered under the Securities Act of 1933, as amended, or any applicable state securities laws, and covenants, represents and warrants that such Person acquired the relevant Interests for investment only and not with a view to the resale or distribution thereof; and
(g) any other information or documentation similar to that described in Section 9.5(f) as the Board of Directors may request;
Substituted Partners. The General Partner is authorized to execute appropriate instruments evidencing the admission of a Transferee of an Interest which is admitted as a Limited Partner.
Substituted Partners. As of the effectiveness of any transfer of an Interest permitted under this Agreement, (i) any transferee acquiring the Interest of a Partner shall be deemed admitted as a substituted Partner with respect to the Interest transferred, and (ii) such substituted Partner shall be entitled to the rights and powers and subject to the restrictions and liabilities of the transferring Partner with respect to the Interest so acquired. No purported transfer of an Interest in violation of the terms of this Agreement (including any transfer occurring by operation of Law) shall vest the purported transferee with any rights, powers or privileges hereunder, and no such purported transferee shall be deemed a Partner hereunder for any purposes or have any right to vote or consent with respect to Partnership matters, to inspect Partnership records, to maintain derivative proceedings, to maintain any action for an accounting or to exercise any other rights of a Partner hereunder or under the Delaware Act.
Substituted Partners. Any transferee acquiring the Interest of a Partner as permitted under Article XVI shall be deemed admitted as a substituted Partner with respect to the Interest transferred concurrently with the effectiveness of such transfer (provided that such transferee, unless already a Partner, shall, as a condition to such admission, execute a counterpart of this Agreement, agreeing thereby to be bound by all of the terms and conditions hereof), and such substituted Partner shall be entitled to all of the rights and benefits under this Agreement of the transferor of such Interest. No purported transfer of any Interest, or any portion thereof or interest therein, in violation of the terms of this Agreement (including any transfer occurring by operation of law) shall vest the purported transferee with any rights, powers, or privileges hereunder, and no such purported transferee shall be deemed for any purposes as a Partner hereunder or have any right to vote or consent with respect to Partnership matters, to inspect Partnership records, to maintain derivative proceedings, to maintain any action for an accounting or to exercise any other rights of a Partner hereunder or, under the Act.
Substituted Partners. Anything herein to the contrary notwithstanding, no successor-in-interest of a Partner and no assignee or transferee of all or any part of the Venture Interest of a Partner shall be admitted to the Venture as a Substituted Partner except upon: (i) submitting to the Partners a duly executed and acknowledged counterpart of the instrument or instruments effecting or evidencing the transfer; (ii) submitting to the Partners a counterpart of this Agreement (as amended through the date of transfer) signed by the transferee and appropriately signifying the transferee's agreement to be bound by all the provisions of this Agreement (as amended through the date of transfer); (iii) the transferee's obtaining the remaining Partners' written consent thereto; and (iv) the transferee's paying all costs and expenses, including, without limitation, attomeys'fees of the Venture incurred in effecting the substitution. An assignee who does not, for any reason, become a Substituted Partner shall be entitled as a result of the assignment only to receive the economic benefits of the Venture Interest to which its assignor otherwise would be entitled, and the assignee shall not have any right to demand or to receive any account of the Venture's business or to inspect the Venture's books and records or any other rights as a Partner, unless and until he is admitted to the Venture as a Substituted Partner.