Notwithstanding Section 10A-1-9.12, upon the winding up of a limited partnership, the assets of the limited partnership, including any obligation under Article 5 of this chapter, and any contribution required by this section, shall be applied as follows:
(a) Payment, or adequate provision for payment, shall be made to creditors, including, to the extent permitted by law, partners who are creditors, in satisfaction of liabilities of the limited partnership.
(b) After a limited partnership complies with subsection (a), any surplus must be distributed:
(1) first, to each person owning a transferable interest that reflects contributions made on account of the transferable interest and not previously returned, an amount equal to the value of the person's unreturned contributions; and
(2) then to each person owning a transferable interest in the proportions in which the owners of transferable interests share in distributions before dissolution.
(c) If the limited partnership does not have sufficient surplus to comply with subsection (b)(1), any surplus must be distributed among the owners of transferable interests in proportion to the value of their respective unreturned contributions.
(d) If a limited partnership's assets are insufficient to satisfy all of its obligations under subsection (a), with respect to each unsatisfied obligation incurred when the limited partnership was not a limited liability limited partnership, the following rules apply:
(1) Each person that was a general partner when the obligation was incurred and that has not been released from the obligation under Section 10A-9A-6.07 shall contribute to the limited partnership for the purpose of enabling the limited partnership to satisfy the obligation. The contribution due from each of those persons is in proportion to the right to receive distributions in the capacity of general partner in effect for each of those persons when the obligation was incurred.
(2) If a person does not contribute the full amount required under paragraph (1) with respect to an unsatisfied obligation of the limited partnership, the other persons required to contribute by paragraph (1) on account of the obligation shall contribute the additional amount necessary to discharge the obligation. The additional contribution due from each of those other persons is in proportion to the right to receive distributions in the capacity of general partner in effect for each of those other persons when the obligation was incurred.
(3) If a person does not make the additional contribution required by paragraph (2), further additional contributions are determined and due in the same manner as provided in that paragraph.
(e) A person that makes an additional contribution under subsection (d)(2) or (3) may recover from any person whose failure to contribute under subsection (d)(1) or (2) necessitated the additional contribution. A person may not recover under this subsection more than the amount additionally contributed. A person's liability under this subsection may not exceed the amount the person failed to contribute.
(f) The estate of a deceased individual is liable for the person's obligations under this section.
(g) An assignee for the benefit of creditors of a limited partnership or a partner, or a person appointed by a court to represent creditors of a limited partnership or a partner, may enforce a person's obligation to contribute under subsection (d).
Last modified: May 3, 2021