Partnership Agreement: Definition of Transferable Interests

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A partnership agreement sets forth the terms and conditions that govern the relationship between business partners and their obligations to the partnership. Without a written partnership agreement, state law may determine the default rules as to the rights of partners and how partnership assets and liabilities will be distributed. This partnership agreement provision on Definition of Transferable Interests may be inserted into a partnership agreement and can be modified depending on the partners’ specific needs. Such a provision can help assure that all partners understand whether partnership interests they hold may be transferred by way of assignment or sale to a third party.

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									A partnership agreement sets forth the terms and conditions that govern the relationship
between business partners and their obligations to the partnership. Without a written
partnership agreement, state law may determine the default rules as to the rights of
partners and how partnership assets and liabilities will be distributed. This partnership
agreement provision on Definition of Transferable Interests may be inserted into a
partnership agreement and can be modified depending on the partners’ specific needs.
Such a provision can help assure that all partners understand whether partnership
interests they hold may be transferred by way of assignment or sale to a third party.
                            DEFINITION OF TRANSFERABLE INTERESTS

Transferable interest of a Partner in the Partnership means the Partner's share of the profits and
losses of the Partnership and the Partner's right to receive distributions that is subject to
assignment or sale to a third party.




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