Common use of Redemption/Sale of Interest Clause in Contracts

Redemption/Sale of Interest. If a Limited Partner becomes a Withdrawn Limited Partner, the General Partner may, in its sole discretion, provide for the redemption or sale of such Withdrawn Limited Partner’s interest in the Partnership as follows: (i) The General Partner may cause the Partnership to distribute to the Withdrawn Limited Partner, in complete redemption of the Withdrawn Limited Partner’s interest in the Partnership, an amount equal to: (x) the Withdrawn Limited Partner’s Updated Capital Account balance (or zero if such balance is negative) as of the Close of Business on the effective date of the Withdrawal Event or (y) such lesser amount as is acceptable to the General Partner and the Withdrawn Limited Partner. The General Partner shall have absolute discretion to cause the Partnership to make all or any portion of such distribution in cash or in kind; provided, however, that, unless the Withdrawn Limited Partner otherwise consents, the Withdrawn Limited Partner shall not be required to receive an in-kind distribution of any asset which exceeds the portion of such asset that would have been distributed to the Withdrawn Limited Partner if: (x) the Partnership had dissolved at the Close of Business on the effective date of the Withdrawal Event and (y) undivided interests in all Partnership assets had been distributed to the Partners in proportion to their respective interests in the liquidation proceeds under Section 8.3. The Withdrawn Limited Partner shall not share in the Profits and Losses of the Partnership allocable after the Close of Business on the effective date of the Withdrawal Event. Notwithstanding the foregoing provisions of this Section 7.4(b)(i), in the case of a Withdrawn Limited Partner that, prior or subsequent to its Withdrawal Event, failed to satisfy its obligations under Section 6.11 in respect of a request by the General Partner reasonably related to the Partnership’s efforts to comply with and minimize withholding under a FATCA Rule, the General Partner, in its sole discretion, may cause the Partnership to specially redeem such Withdrawn Limited Partner’s entire interest in the Partnership for a nonrecourse promissory note (payable exclusively from, and in lieu of, the distributions such Withdrawn Limited Partner would have received from the Partnership in the absence of such special redemption, taking into account without limitation the operation of Section 3.6(c)). Such promissory note shall: (i) provide for no interest; and (ii) have a stated principal amount equal to: (x) such Withdrawn Limited Partner’s Updated Capital Account balance (or zero if such balance is negative) as of the Close of Business on the effective date of its Withdrawal Event, reduced (but not below zero) by the amount of any distributions made to such Withdrawn Limited Partner subsequent to the Close of Business on the effective date of its Withdrawal Event; or (y) such lesser amount as is acceptable to the General Partner and such Withdrawn Limited Partner. (ii) The General Partner may sell the Partnership interest of the Withdrawn Limited Partner to any Person or Persons designated by the General Partner (with the consent of such Person or Persons) and remit to the Withdrawn Limited Partner the Net Sales Proceeds. The sale price shall be an amount equal to: (x) the Withdrawn Limited Partner’s Updated Capital Account balance (or zero if such balance is negative) as of the Close of Business on the effective date of the Withdrawal Event or (y) such lesser amount as is mutually acceptable to the General Partner and the Withdrawn Limited Partner. The sale price shall be payable in cash except in the case of a Withdrawn Limited Partner that, prior or subsequent to its Withdrawal Event, failed to satisfy its obligations under Section 6.11 in respect of a request by the General Partner reasonably related to the Partnership’s efforts to comply with and minimize withholding under a FATCA Rule. In such case: (i) the sale price shall be payable in the form of a promissory note with substantially the same terms as set forth in Section 7.4(b)(i); and (ii) the General Partner, its members and their respective Affiliates shall not purchase all or any portion of the Withdrawn Limited Partner’s interest without first offering to all the Partners a right to participate in such purchase (on a pro rata basis, in proportion to their respective Capital Contributions, pursuant to a procedure reasonably prescribed by the General Partner). (iii) If only a portion of a Limited Partner’s interest in the Partnership is withdrawn, the foregoing provisions of this Section 7.4(b) shall be adjusted to apply only in respect of such withdrawn interest. Pursuant to the mutual consent of the General Partner and a Withdrawn Limited Partner (which consent may be withheld in such Persons’ sole discretion), such Withdrawn Limited Partner may receive less than the full amount to which it is otherwise entitled under this Section 7.4(b).