79-14-602 - Withdrawal of general partner.
§ 79-14-602. Withdrawal of general partner.
(a) A general partner may withdraw from a limited partnership at any time by giving written notice to the other partners. If a general partner withdraws pursuant to Section 79-14-402(a)(1) or 79-14-402(a)(2) and such withdrawal violates the partnership agreement, the limited partnership may recover from the withdrawing general partner damages for breach of the partnership agreement and, in addition to any other remedies, shall have the right to offset the damages against the amount otherwise distributable to the general partner. Unless otherwise provided in writing in the partnership agreement, in the case of a limited partnership for a fixed term, a withdrawal by a general partner pursuant to Section 79-14-402(a)(1) or 79-14-402(a)(2) prior to the expiration of that term is a breach of the partnership agreement.
(b) Unless otherwise provided in the partnership agreement, and subject to the liability created under subsection (a) of this section, a general partner who ceases to be a general partner under Section 79-14-402 shall:
(1) Retain the same interest in that partner's capital account, profits, losses and distributions, but that interest shall be that of a limited partner;
(2) Not be personally liable for limited partnership debts incurred after the person ceases to be a general partner, other than any debts incurred by reason of that person's being deemed to be acting as a general partner, pursuant to Section 79-14-402;
(3) Be entitled to vote as a limited partner on all matters except the admission and compensation of a general partner; and
(4) Have the partner's interest in profits, losses and distributions reduced pro rata with all other partners to provide compensation, or an interest in the limited partnership, or both, to a new general partner.
Sources: Laws, 1987, ch. 488, § 602; Laws, 1990, ch. 385, § 3, eff from and after passage (approved March 13, 1990).