Class C Priority Allocation Clause Samples
The Class C Priority Allocation clause establishes the order in which Class C stakeholders receive distributions or payments relative to other classes. In practice, this clause specifies that, after satisfying the claims of higher-priority classes (such as Class A and B), any remaining funds or assets are allocated to Class C participants according to predefined terms. This mechanism ensures that the rights and expectations of Class C stakeholders are clearly defined, reducing disputes and providing transparency in the distribution process.
Class C Priority Allocation. The holders of the Class C Units shall be allocated gross income such that, from the inception of the partnership through the end of the Fiscal Year to which the allocation relates, including the year of liquidation of the Partnership in accordance with Article X, the sum of all priority allocations pursuant to this Section 5.2(I) equals (or approaches as nearly as possible) the sum of all Class C Priority Return Amounts accrued through the end of the fiscal year to which the allocation relates.