Limited Partnership Interest Transfer and Assignee Admission in Delaware

At a glance

Requirements one by one

Assignment and admission

Delaware's partnership interest covers profits, losses, and distributions (§ 17-101(15)); it is personal property (§ 17-701). Unless the agreement says otherwise, the interest is assignable in whole or part. Assignment does not dissolve the LP or itself make the assignee a partner; the assignee receives assigned profits, losses, distributions, and allocations (§ 17-702(a)(1)-(4)). The separate assignee route is the agreement or, by default, the vote or consent of every partner, including when the assignor was a general partner (§§ 17-301(b)(2), 17-704(a)).

Certificates and liabilities

The agreement may govern certificates and transfers of certificated interests. The statute permits, but does not require, a certificate and bars bearer form (§ 17-702(b)-(c)). Before admission, the assignee does not incur partner liability merely from assignment unless the agreement says otherwise or the assignee assumes it (§ 17-702(b)-(c)). On admission, the assignee takes limited-partner rights and restrictions and the assignor's ascertainable contribution obligations, but not the assignor's liabilities under Subchapter VI (§ 17-502(a)(1); § 17-704(b)).

What trips people up

A full assignment usually ends status; a pledge does not. A partner who assigns all partnership interests ceases to be a partner by default, whereas a pledge or security encumbrance does not have that effect (§ 17-702(a)(1)-(4); § 17-702(a)(4)). The assignor remains liable to the partnership under Subchapters V and VI even after assignment and even if the assignee becomes a limited partner (§ 17-704(c)).

Economic rights are not information rights. The assignee receives assigned allocations and distributions, but assignment confers no partner powers (§ 17-702(a)(1)-(4)). The statutory demand right belongs to a limited partner (§ 17-305(a)); an assignee seeking it must consider admission and the agreement.

Statutes and sources

• § 17-702(a)-(c): Assignment “does not dissolve a limited partnership or entitle the assignee to become or to exercise any rights or powers of a partner”; the statute separately addresses full assignments and pledges. (official text; accessed October 2, 2026).
• § 17-704(a)-(c): Admission is “As provided in the partnership agreement” or by “the vote or consent of all partners”; the admitted assignee's liabilities and the assignor's continuing liability are specified separately. (official text; accessed October 2, 2026).