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general partnership interests to their children, who were permitted
assignees within the meaning of section 8.03, should have resulted
in the admission of the Kerr children as class B limited partners
of KFLP. Petitioners were free, of course, to override section
8.20 of the partnership agreement and admit the Kerr children as
general partners of KFLP. Nevertheless, considering the
unambiguous terms of section 8.20, it would have been reasonable to
expect that petitioners would clearly document the admission of the
Kerr children as general partners of KFLP by way of written
consents. Given the lack of formality surrounding the admission of
the Kerr children as general partners of KFLP, we are left with the
impression that petitioners either did not fully appreciate the
terms of the KFLP partnership agreement or deemed formal consents
to the admission of the Kerr children as general partners to be
unnecessary. In either case, petitioners' failure to take any
formal steps in regard to the admission of the Kerr children as
general partners of KFLP belies petitioners' contention that the
Kerr childrens' formal consent was necessary to admit the GRAT’s
trustees as limited partners of KFLP.
B. The Form of the Transfers
Petitioners transferred limited partnership interests to
themselves as GRAT’s trustees. Although it is agreed that the
GRAT’s trustees were permitted assignees under section 8.03 of the
KFLP partnership agreement, petitioners contend that the GRAT’s
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