SB810,120,2 (3) A person does not have a right to demand or receive a distribution from a limited partnership in any form other than money. Except as otherwise provided in s. 179.0810 (5), a partnership may distribute an asset in kind only if each part of the asset is fungible with each other part and each person receives a percentage of the asset equal in value to the person's share of distributions.

SB810,120,8 (4) If a partner or transferee becomes entitled to receive a distribution, the partner or transferee has the status of, and is entitled to all remedies available to, a creditor of the limited partnership with respect to the distribution. However, the partnership's obligation to make a distribution is subject to offset for any amount owed to the partnership by the partner or a person dissociated as a partner on whose account the distribution is made.

SB810,120,11 179.0504 Limitations on distributions. (1) A limited partnership may not make a distribution, including a distribution under s. 179.0810, if after the distribution any of the following applies:

SB810,120,13 (a) The partnership would not be able to pay its debts as they become due in the ordinary course of the partnership's activities and affairs.

SB810,120,18 (b) The partnership's total assets would be less than the sum of its total liabilities plus the amount that would be needed, if the partnership were to be dissolved and wound up at the time of the distribution, to satisfy the preferential rights upon dissolution and winding up of partners and transferees whose preferential rights are superior to the rights of persons receiving the distribution.

SB810,120,20 (2) A limited partnership may base a determination that a distribution is not prohibited under sub. (1) on any of the following:

SB810,120,22 (a) Financial statements prepared on the basis of accounting practices and principles that are reasonable in the circumstances.

SB810,120,24 (b) A fair valuation or other method that is reasonable under the circumstances.

SB810,121,2 (3) Except as otherwise provided in sub. (5), the effect of a distribution under sub. (1) is measured as follows:

SB810,121,4 (a) In the case of a distribution as described in s. 179.0102 (4) (a) 1. and 2., as of the earlier of the following:

SB810,121,6 1. The date money or other property is transferred or debt is incurred by the limited partnership.

SB810,121,8 2. The date the person entitled to the distribution ceases to own the interest or rights being acquired by the partnership in return for the distribution.

SB810,121,10 (b) In the case of any distribution of indebtedness other than one under par. (a), as of the date the indebtedness is distributed.

SB810,121,11 (c) In all cases other than those under par. (a) or (b), as of the following:

SB810,121,13 1. The date the distribution is authorized, if the payment occurs not later than 120 days after that date.

SB810,121,15 2. The date the payment is made, if the payment occurs more than 120 days after the distribution is authorized.

SB810,121,19 (4) A limited partnership's indebtedness to a partner or transferee incurred by reason of a distribution made in accordance with this section is at parity with the partnership's indebtedness to its general, unsecured creditors, except to the extent subordinated by agreement.

SB810,122,2 (5) A limited partnership's indebtedness, including indebtedness issued as a distribution, is not a liability for purposes of sub. (1) if the terms of the indebtedness provide that payment of principal and interest is made only if and to the extent that a payment of a distribution could then be made under this section. If the indebtedness is issued as a distribution, each payment of principal or interest is treated as a distribution, the effect of which is measured on the date the payment is made.

SB810,122,5 (6) In measuring the effect of a distribution under s. 179.0810, the liabilities of a dissolved limited partnership do not include any claim that has been disposed of under s. 179.0806, 179.0807, or 179.0808.

SB810,122,10 179.0505 Liability for improper distributions. (1) If a general partner consents to a distribution made in violation of s. 179.0504 and in consenting to the distribution fails to comply with s. 179.0409, the general partner is personally liable to the limited partnership for the amount of the distribution which exceeds the amount that could have been distributed without the violation of s. 179.0504.

SB810,122,14 (2) A person that receives a distribution knowing that the distribution violated s. 179.0504 is personally liable to the limited partnership but only to the extent that the distribution received by the person exceeded the amount that could have been properly paid under s. 179.0504.

SB810,122,17 (3) A general partner against which an action is commenced because the general partner is liable under sub. (1) with respect to a distribution may do any of the following:

SB810,122,19 (a) Implead any other person that is liable under sub. (1) with respect to the distribution and seek to enforce a right of contribution from the person.

SB810,122,22 (b) Implead any person that received the distribution in violation of sub. (2) and seek to enforce a right of contribution from the person in the amount the person received in violation of sub. (2).

SB810,122,24 (4) An action under this section is barred unless commenced not later than 2 years after the distribution.

SB810,122,25 subchapter VI

SB810,123,1 DISSOCIATION

SB810,123,4 179.0601 Dissociation as limited partner. (1) A person does not have a right to dissociate as a limited partner before the completion of the winding up of the limited partnership.

SB810,123,6 (2) A person is dissociated as a limited partner when any of the following applies: