Buyout Formulas

Larger partnerships may have put options or formulas for buying out partners who wish to exit, and with enough activity, could constitute a market. The formula could specify that a certain standard of value be used, or even that specific assumptions be used by the valuer. Depending on the facts, it might be necessary to value the interest twice, once under a (say) normal fair market value premise, and again using the terms and conditions of the formula, reconciling the two conclusions. You can read more on formulas and buyouts generally here.