- 7 -
management trust satisfied all requirements under Texas law to
create a trust. The management trust was the partnership’s
general partner.
d. Petitioners each transferred a one-half unit of the
partnership to the management trust. That unit is the only asset
held by the management trust. Petitioners each owned a 49.5-
percent interest in the partnership as limited partners.
e. Petitioners created trusts for Mary Knight and Douglas
Knight (the children’s trusts). The documents petitioners
executed were sufficient under Texas law to create the children’s
trusts. Douglas Knight and Mary Knight were each the beneficiary
and trustee of the children’s trust bearing their name.
f. Petitioners each signed codicils to their wills in
which they changed the bequests to their children to bequests to
the children’s trusts.
g. Petitioners each transferred a 22.3-percent interest in
the partnership to each of the children’s trusts. After those
transfers, petitioners each retained a 4.9-percent interest in
the partnership as limited partners.
3. The Partnership Agreement
The partnership has been a limited partnership under Texas
law since it was created. Article 9 of the partnership agreement
prohibits any partner from withdrawing from the partnership or
demanding the return of any of his or her capital contribution or
Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Next
Last modified: May 25, 2011