Drafting and Negotiating Limited Partnership Agreements From the General Partner and Limited Partner Perspectives (2003)

By: Sally A. Schreiber

Jan 01, 2003

ARTICLE 1. DEFINITIONS

1.1 Certain Definitions. As used in this Agreement, each of the following terms has the meaning given to it below:

"Acquisition Debt " means $_________ million in indebtedness to be borrowed by the Partnership from _________ to finance the acquisition of the Property.

"Adjusted Capital Account Deficit " means, with respect to an Interest Owner, the deficit balance, if any, in the Interest Owner's Capital Account as of the end of the relevant Adjustment Period, after giving effect to the following adjustments:

(a) The Capital Account will be increased to reflect any amounts that such Interest Owner is obligated to restore to the Partnership or is deemed to be obligated to restore under Treasury Regulations Sections 1.704-1(b)(2)(ii)(c) and 1.704-2(g) and (i)(5); and
(b) The Capital Account will be decreased by the items described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5), and (6).

This definition of Adjusted Capital Account Deficit and the application of the term in the manner provided in this Agreement are intended to comply with the provisions of Treasury Regulations Section 1.704-1(b)(2)(ii)(d) and will be interpreted consistently with those provisions. 

WARNING: THIS SAMPLE SHOULD NOT BE USED AS IS FOR ANY TRANSACTION.  IT WAS DRAFTED MERELY TO ILLUSTRATE CERTAIN ISSUES.


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