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studies generally covered the years 1975 through 1995, and found
marketability discounts ranging from 40 to 63 percent.66
Next, the Kimball reports generally addressed aspects of all
the True companies’ partnership agreements and Wyoming’s general
partnership law that made the subject partnership interests less
liquid than publicly traded stock or limited partnership
interests. Mr. Kimball testified that he factored all the
partnership agreement provisions (other than the book value buy-
sell price) into his determination of marketability discounts.
First, the Kimball reports noted that transfer or assignment
of a partnership interest would not terminate the partnership, so
that a hypothetical buyer would have to litigate to force
liquidation of a True partnership.
Second, the Kimball reports stated that Wyoming law required
a buyer to obtain consent from the existing partners to be
admitted as a new partner; otherwise, the buyer would be treated
as a transferee with rights limited to receiving his or her pro
rata share of current and liquidating distributions. As a
result, the Kimball reports concluded that potential purchasers
would be discouraged from buying an interest in a True
partnership without the assurance of gaining such consent.
Third, the Kimball reports observed that the mandatory buy-
sell provisions would have a chilling effect on the market for
66One of the studies specifically omitted natural resource
companies from the group of companies being examined.
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