1. (a) Death or legal incapacity of the owner, or
2. (b) A substantial reduction in the owner's net worth or income (defined to mean an involuntary loss of not less than 50% in income or net worth during the year in which redemption occurs) provided that (1) the limited partnership has sufficient cash to make the purchase, (2) the purchase will not be in violation of applicable legal requirements and (3) not more than 15% of the outstanding units are purchased in any year. Where the purchase price is not mutually agreed upon, the matter shall be submitted to arbitration.

Ordinarily, the partnership and the sponsor may not be obligated to redeem or repurchase any of its limited partnership interests, although the partnership and the sponsor may not be precluded from purchasing such outstanding limited partnership interests, if such purchase does not impair the capital or operation of the partnership. Notwithstanding the foregoing, a real estate limited partnership may provide for mandatory redemption rights under the following circumstances:

Note: Authority cited: Section 25610, Corporations Code. Reference: Section 25140, Corporations Code.

History

1. Amendment filed 1-27-84; effective thirtieth day thereafter (Register 84, No. 4).

2. Amendment filed 5-18-92; operative 6-17-92 (Register 92, No. 22).