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by selling the Partnership property. The proceeds of
liquidation and any other assets of the Partnership
shall be applied and distributed in the following order
of priority:
12.1.1. To the extent of debts and
liabilities of the Partnership * * * and the expense of
liquidation;
12.1.2. To the setting up of any reserves
that the Liquidator may deem reasonably necessary for
any contingent or unforeseen liabilities or obligations
of the Partnership * * *;
12.1.3. To the payment of any loans or
advances (including interest thereon) that may have
been made by any of the Partners;
12.1.4. To the Partners in accordance with
their respective capital accounts; and
12.1.5. Any balance then remaining shall be
distributed to the Partners in proportion to their
respective interest in the Partnership.
Sunroad Asset later informed Collins that it intended to
distribute to him in connection with HCMP’s dissolution the cash
value of his HCMP interest as ascertained using the marina’s
July 31, 1998, appraised value of $16.5 million. That approach
was consistent with the partnership agreement’s “buyout
provisions”, discussed infra, but inconsistent with the
applicable provisions of paragraph 12 of the partnership
agreement. Collins also knew at or about that time that Sunroad
Asset intended to distribute the marina to itself or to its
affiliate. That approach also was inconsistent with the
applicable provisions of paragraph 12 of the partnership
agreement.
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Last modified: May 25, 2011