PARRIS N. GLENDENING, Governor

Ch. 654

PARTNER'S DISSOCIATION, UNLESS THE PARTNER PARTICIPATES IN WINDING UP
THE PARTNERSHIP'S BUSINESS PURSUANT TO § 9-803 OF THIS TITLE

SUBTITLE 7. PARTNER'S DISSOCIATION WHEN BUSINESS NOT WOUND UP.
9-701. PURCHASE OF DISSOCIATED PARTNER'S INTEREST.

(A)    IF A PARTNER IS DISSOCIATED FROM A PARTNERSHIP WITHOUT
RESULTING IN A DISSOLUTION AND WINDING UP OF THE PARTNERSHIP BUSINESS
UNDER § 9-801 OF THIS TITLE, THE PARTNERSHIP SHALL CAUSE THE DISSOCIATED
PARTNER'S INTEREST IN THE PARTNERSHIP TO BE PURCHASED FOR A BUYOUT
PRICE DETERMINED PURSUANT TO SUBSECTION (B) OF THIS SECTION.

(B)     THE BUYOUT PRICE OF A DISSOCIATED PARTNER'S INTEREST IS THE
AMOUNT THAT WOULD HAVE BEEN DISTRIBUTABLE TO THE DISSOCIATING
PARTNER UNDER § 9-807(B) OF THIS TITLE IF, ON THE DATE OF DISSOCIATION, THE
ASSETS OF THE PARTNERSHIP WERE SOLD AT A PRICE EQUAL TO THE GREATER OF
THE LIQUIDATION VALUE OR THE VALUE BASED ON A SALE OF THE ENTIRE
BUSINESS AS A GOING CONCERN WITHOUT THE DISSOCIATED PARTNER AND THE
PARTNERSHIP WERE WOUND UP AS OF THAT DATE. INTEREST MUST BE PAID FROM
THE DATE OF DISSOCIATION TO THE DATE OF PAYMENT.

(C)     DAMAGES FOR WRONGFUL DISSOCIATION UNDER § 9-602(B) OF THIS
TITLE, AND ALL OTHER AMOUNTS OWING, WHETHER OR NOT PRESENTLY DUE,
FROM THE DISSOCIATED PARTNER TO THE PARTNERSHIP, MUST BE OFFSET
AGAINST THE BUYOUT PRICE INTEREST MUST BE PAID FROM THE DATE THE
AMOUNT OWED BY THE DISSOCIATED PARTNER BECOMES DUE TO THE DATE OF
PAYMENT.

(D)    A PARTNERSHIP SHALL INDEMNIFY A DISSOCIATED PARTNER WHOSE
INTEREST IS BEING PURCHASED AGAINST ALL PARTNERSHIP LIABILITIES, WHETHER
INCURRED BEFORE OR AFTER THE DISSOCIATION, EXCEPT LIABILITIES INCURRED
BY AN ACT OF THE DISSOCIATED PARTNER UNDER § 9-702 OF THIS SUBTITLE

(E)     IF NO AGREEMENT FOR THE PURCHASE OF A DISSOCIATED PARTNER'S
INTEREST IS REACHED WITHIN 120 DAYS AFTER A WRITTEN DEMAND FOR
PAYMENT, THE PARTNERSHIP SHALL PAY, OR CAUSE TO BE PAID, IN CASH TO THE
DISSOCIATED PARTNER THE AMOUNT THE PARTNERSHIP ESTIMATES TO BE THE
BUYOUT PRICE AND ACCRUED INTEREST UNDER SUBSECTION (B) OF THIS SECTION,
REDUCED BY ANY OFFSETS AND ACCRUED INTEREST UNDER SUBSECTION (C) OF
THIS SECTION.

(F)     IF A DEFERRED PAYMENT IS AUTHORIZED UNDER SUBSECTION (H) OF
THIS SECTION, THE PARTNERSHIP MAY TENDER A WRITTEN OFFER STATING THE
AMOUNT IT ESTIMATES TO BE THE BUYOUT PRICE AND ACCRUED INTEREST UNDER
SUBSECTION (B) OF THIS SECTION, REDUCED BY ANY OFFSETS AND ACCRUED
INTEREST UNDER SUBSECTION (C) OF THIS SECTION, STATING THE TIME OF
PAYMENT AND THE OTHER TERMS AND CONDITIONS OF THE OBLIGATION.

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