Common use of Distribution of Net Proceeds of Sale or Financing Clause in Contracts

Distribution of Net Proceeds of Sale or Financing. A. Upon a Financing and upon a Sale that does not constitute a Sale of all or substantially all of the Properties, Net Proceeds from the Financing or Sale shall be distributed, credited and applied in the following order of priority: (i) First, to the Investors until each Investor has received an amount equal to his unpaid Preferred Return, if any, and then his Adjusted Capital Balance. (ii) Second, to the General Partner, an amount equal to the sum of its Adjusted Capital Balance and the deferred Net Cash Flow Amount. (iii) Third, except as provided in Section 4.2D below, any remaining Net Proceeds of Sale or Financing shall be distributed 90% to the Investors, 9% to Realty Associates 1988 Limited Partnership, and 1% to the General Partner. B. Upon the Sale of all or substantially all of the Properties, Net Proceeds from the Sale shall be allocated to the Partners and Investors, in proportion to their positive Capital Accounts, after the allocation of Profit and Loss pursuant to Sections 4.1A and 4.1B, until all such Capital Accounts have been reduced to zero. C. All Net Proceeds of Sale or Financing distributable with respect to any Unit which is transferred during a taxable year of the Partnership shall be distributed to the Persons recognized (in accordance with Section 7.4 hereof) as Investors as of the first business day of the month that includes the date on which the Sale or Financing occurs; provided, however, that all Net Proceeds from a Sale received by the Partnership as a result of an installment or other deferred Sale shall be distributed to the Persons recognized (in accordance with Section 7.4 hereof) as Investors as of the first business day of the month that includes the date on which the deferred Net Proceeds from a Sale are received by the Partnership. D. Notwithstanding any other provision of this Article IV, the Subordinated Limited Partner shall not be entitled to receive any Net Proceeds from a Sale except (i) to the extent that it has been or will be allocated Profit from such Sale in an amount equal to the Net Proceeds from such Sale which will be allocated to it pursuant to Section 4.1A, and (ii) if the amount of Net Proceeds from such Sale which it would be otherwise entitled to receive exceeds the amount of Profit from such Sale to be allocated to it pursuant to Section 4.1A, then, in addition to the amount to which the Subordinated Limited Partner is entitled to receive under subparagraph (i), an amount equal to the excess of the amount that the Subordinated Limited Partner has agreed to contribute pursuant to Section 3.1 over the amount of Profit from such Sale which is allocated to it (reduced by prior distributions pursuant to this subparagraph (ii)).

Distribution of Net Proceeds of Sale or Financing. A. Upon a Financing and upon a Sale that does not constitute a Sale of all or substantially all of the Properties, Net Proceeds from the Financing or Sale shall be distributed, credited and applied in the following order of priority: (i) First, 99% to the Investors in proportion to their respective unpaid Preferred Returns and 1% to the General Partner until each Investor has received an amount equal to his unpaid Preferred Return, if any, and then his Adjusted Capital Balance. (ii) Second, 99% to the Investors in proportion to their respective Adjusted Capital Balances and 1% to the General Partner, Partner until each Investor has received an amount equal to the sum of its his Adjusted Capital Balance and the deferred Net Cash Flow AmountBalance. (iii) Third, except as provided in Section 4.2D below, any remaining Net Proceeds of Sale or Financing shall be distributed 90% to the Investors, 9% to Realty Associates 1988 the Subordinated Limited PartnershipPartner, and 1% to the General Partner. B. Upon the Sale of all or substantially all of the Properties, Net Proceeds from the Sale shall be allocated to the Partners and Investors, in proportion to their positive Capital Accounts, after the allocation of Profit and Loss pursuant to Sections 4.1A and 4.1B, until all such Capital Accounts have been reduced to zero. C. All Net Proceeds of Sale or Financing distributable with respect to any Unit which is transferred during a taxable year of the Partnership shall be distributed to the Persons recognized (in accordance with Section 7.4 hereof) as Investors as of the first business day of the month that includes the date on which the Sale or Financing occurs; provided, however, that all Net Proceeds from a Sale received by the Partnership as a result of an installment or other deferred Sale shall be distributed to the Persons recognized (in accordance with Section 7.4 hereof) as Investors as of the first business day of the month that includes the date on which the deferred Net Proceeds from a Sale are received by the Partnership. D. Notwithstanding To the extent in any other provision of this Article IV, fiscal year the Subordinated Limited Partner shall not be entitled to receive any Net Proceeds from receives a Sale except (i) to the extent that it has been or will be allocated Profit from such Sale in an amount equal to the Net Proceeds from such Sale which will be allocated to it distribution pursuant to Section 4.1A, and (ii4.2A(iii) if the amount in excess of Net Proceeds from such Sale which it would be otherwise entitled to receive exceeds the amount of Profit from such Sale to be allocated to it pursuant to Section 4.1A, then, in addition to the amount to which the Subordinated Limited Partner is entitled to receive under subparagraph (i), an amount equal to the excess of the amount that the Subordinated Limited Partner has agreed to contribute pursuant to Section 3.1 over 4.1A(iii), such excess shall constitute the amount equivalent of Profit from such Sale which is a "guaranteed payment"pursuant to Section 707(c) of the Code and the deduction attributable thereto shall be specially allocated 1% to it (reduced by prior distributions pursuant the General Partner and 99% to this subparagraph (ii))the Investors.