Distribution Priority Clause Samples
The Distribution Priority clause establishes the order in which payments or distributions are made among parties involved in an agreement. Typically, it specifies which parties receive payment first and how any remaining funds are allocated among subsequent parties, often using a waterfall structure. This clause is essential for clarifying the sequence of payments, thereby reducing disputes and ensuring that all parties understand their position in the payment hierarchy.
Distribution Priority. Upon the dissolution of the Partnership as provided in Section 8.1 hereof (“Dissolution”), the Partnership assets shall be liquidated (except as permitted by Section 8.3 hereof) and the affairs of the Partnership shall be wound up and terminated by the General Partner or, if there is no General Partner, by a liquidating trustee selected by a majority in Interest of the Limited Partners. Upon completion of such liquidation and winding up, but not later than two years after the end of the Fiscal Year during which Dissolution occurs, and after taking into account all capital account adjustments and allocations of income, gains, losses and deductions for the Partnership taxable year during which Dissolution occurs, including, without limitation, the allocation of all income, gains, losses and deductions pursuant to Article 4 hereof that would arise if all Partnership assets to be distributed in kind were sold for their fair market values, the assets of the Partnership shall be liquidated and disposed of and distributed as follows:
(a) First, to the payment of debts and liabilities of the Partnership and expenses of the liquidation and winding up;
(b) Second, to the setting up of any reserves (to be held in a special interest-bearing account) which the General Partner or the liquidating trustee may deem reasonably necessary for any contingent or unforeseen liabilities or obligations of the Partnership; provided, however, that at the expiration of such time as the General Partner or such trustee shall deem advisable (not to exceed two (2) years from the event which caused Dissolution, except in the case of any litigation matter where the length of time such reserves are maintained shall be determined by the General Partner or the liquidating trustee in its sole discretion), the balance of such reserves remaining after payment of such contingent liabilities shall be distributed in the manner set forth in Subsection 8.2.1(c);
(c) Third, the balance in proportion to the positive balances in the Partners’ capital accounts.
Distribution Priority. Upon receiving Notices issued pursuant to paragraph 2, 3, or 4 of this Article II, Section D representing claims the aggregate value of which exceeds the funds available therefor in the Payment Account and until such time as the Payment Account contains sufficient funds to make payments in full pursuant to such Notices, the Corporate Trustee shall make distributions first, on account of GCCF Distribution Notices; second, in the chronological order that they are received by the Corporate Trustee, on account of Other Resolved Claims Distribution Notices; and third, in the chronological order that they are received by the Corporate Trustee, on account of NRD Claims or Government Response Costs Distribution Notices; provided, however, that the priority scheme described in this Article II, Section D7 shall not be deemed to alter to any extent or in any manner any payment priority afforded a Beneficiary under otherwise applicable law as such priority relates to recovery of such claim against the Grantor generally as opposed to through application of the funds in the Trust.
Distribution Priority. Distribution Priority Distributions (including the payments contemplated by clause (a)(ii) below which shall not be an equity transaction), other than distributions upon the liquidation of the Company, and contractual or guaranteed payments, whether in respect of Net Distributable Cash of the Company or otherwise, shall be made to the Members as follows and in the following order of priority:
(a) The following distributions (including the payments contemplated by clause (ii) below which shall not be an equity transaction) shall be made each quarter, unless determined otherwise by an Unanimous Vote of the Members:
(i) After the end of each Fiscal Year, to the extent permissible pursuant to financing agreements to which the Company is now or hereafter may become a party, the Company shall distribute to each Member the aggregate amount by which (A) United States federal and state income taxes that would be payable by a Member in the highest tax bracket applicable from time to time to a corporation (and taking into account the character of such income), with respect to the taxable income and gains of the Company allocated to such Member for the Fiscal Year of the Company ending in such year and for all prior Fiscal Years, and after giving effect to all deductions and losses of the Company allocated to such Member for such Fiscal Year and prior Fiscal Years, if applicable (and in each case applying such highest applicable tax brackets thereto), exceeds (B) all amounts previously distributed (or deemed distributed) to such Member in respect of its Membership Interest pursuant to this Agreement. Subject to the limitations set forth above, the Company will, where reasonably practicable, make distributions on a quarterly basis to facilitate the payment of quarterly estimated income taxes by the Members, subject to adjustment at or following the end of such calendar year, as the Company may deem appropriate (including the right of the Company to require prompt repayment of amounts distributed under this sentence in excess of that ultimately determined to be required to be distributed for such period).
(ii) Thereafter, distributions to the Members will be made in respect of the outstanding balance of all debts and liabilities of the Company to the Members to whom the same are owed, including Member loans and amounts payable to withdrawing members pursuant to Section 10.06, in the ratio of the aggregate outstanding amount owed to each such Member by the Company, until...
Distribution Priority. Unless full distributions on the Class SV Units have been or contemporaneously are authorized and paid or authorized and a sum sufficient for the payment thereof is set apart for payment for all past distribution periods and the then current distribution period, no distributions (other than in Units ranking junior to the Class SV Units as to distributions and upon liquidation) shall be authorized or paid or set aside for payment nor shall any other distribution be authorized or made upon Units ranking junior to or on a parity with the Class SV Units as to distributions or upon liquidation, nor shall any Units ranking junior to or on a parity with the Class SV Units as to distributions or upon liquidation be redeemed, purchased or otherwise acquired for any consideration (or any moneys be paid to or made available for a sinking fund for the redemption of any such Units) by the Company.
Distribution Priority. AFTER THE PRE START DATE PERIOD. Within 30 days after the end of each Fiscal Quarter during the Post Start Date Period, Sweetheart shall make distributions of Distributable Cash (or other property in lieu of Distributable Cash) with respect to each Product sold (without duplication), in the following cumulative order and priority:
(a) First, to Sweetheart, to the extent of any Standard Cost of Sales during the Post Start Date Period, less amounts previously distributed under this clause (a);
(b) Second, but only before the Warranty Termination Date, to Sweetheart, to the extent of any Unfavorable Production Variances during the Post Start Date Period, less amounts previously distributed under this clause (b);
(c) Third, to Sweetheart, to the extent of any Manufacturing Overhead during the Post Start Date Period, less amounts previously distributed under this clause (c);
(d) Fourth, to Sweetheart, to the extent of the SG&A Allocation Percentage of Net Sales during the Post Start Date Period, less amounts previously distributed under this clause (d);
(e) Fifth, but only before the Warranty Termination Date, to Sweetheart, to the extent of its cumulative Sweetheart Preliminary Distribution, less amounts previously distributed under this clause (e);
(f) Sixth, to Sweetheart and ECC, in proportion to, and to the extent of (i) in the case of Sweetheart, (A) the Facility Participation payable with respect to the Fiscal Quarter, and (B) the Specified Infrastructure Enhancement Distribution payable with respect to the Fiscal Quarter, and (ii) in the case of ECC, the Equipment Profit Participation payable with respect to the Fiscal Quarter; EXECUTION COPY --------------
(g) Seventh, but only before the Warranty Termination Date, to ECC, to the extent of its cumulative ECC Preliminary Distribution, less amounts previously distributed under this clause (g);
(h) Eighth, to Sweetheart and ECC, in proportion to, and to the extent of, (i) in the case of Sweetheart, any Sweetheart Deficit Account, and (ii) in the case of ECC, any ECC Deficit Account;
(i) Ninth, but only before the Warranty Termination Date, 80% to Sweetheart and 20% to ECC; and
(j) Tenth, 100% to Sweetheart.
Distribution Priority. (a) Subject to Section 5.02(b), the Beethoven Topcos shall, and shall cause their respective Subsidiaries to, unless otherwise mutually agreed by the BCSS Member and the Warner Member, distribute to the Members, all Available Cash or other non-cash consideration generated with respect to the Beethoven Tax Partnership from any liquidation, sale of assets, issuance of securities, sale of securities, Sale of the Company, Initial Public Offering, or other similar transaction by the Beethoven Topcos or their Subsidiaries, including the Beethoven Financing Subsidiaries (each, a “Liquidity Event”), in each case, promptly following the consummation thereof, which, for the avoidance of doubt, shall, in each case, be net of any transaction expenses incurred by or on behalf of the Beethoven Topcos or their Subsidiaries, including the Beethoven Financing Subsidiaries, in connection with such Liquidity Event, solely as follows:
(i) first, to the Class A-1 Members, on a pro rata basis based on their relative Capital Contribution Percentages, until each Class A-1 Member has received in respect of each of its Class A-1 Units an amount equal to [***];
(ii) second, to the Class A-2 Members, on a pro rata basis based on their relative Capital Contribution Percentages, until the Class A-2 Members have received an aggregate amount equal to [***]; and
(iii) thereafter, subject to the last sentence of this Section 5.02(a), to the Class A-1 Members and the Class A-2 Members, pro rata based on their relative Capital Contribution Percentages. Notwithstanding Section 5.02(a)(iii), solely for purposes of calculating “Fair Market Value” in connection with a BCSS to Warner Sale contemplated by Section 8.04, Section 5.02(a)(iii) shall be modified as follows:
(iii) thereafter, to the Class A-1 Members and the Class A-2 Members, pro rata based on their relative Capital Contribution Percentages until such time as the IRR Threshold is met or deemed to have been met in accordance with the definition thereof and, at and after such time, [***] to the Class A-1 Members and [***] to the Class A-2 Members (the “IRR Threshold Distribution Split”). [***].
Distribution Priority. Except as may otherwise be provided pursuant to Section 3.1(a)(3), all distributions of Available Cash from Operations shall be made as follows:
(1) First, to the holders of Class A Units, pro rata, in accordance with the amounts due and unpaid pursuant to this Section 3.1(b)(1), until each holder of Class A Units has received cumulative aggregate distributions pursuant to this Section 3.1(b)(1) and Section 3.1(c)(1) in an amount equal to a cumulative eight percent (8%) annual return, compounded annually, on its Unreturned Capital Contributions;
(2) Second, to the holders of Class B Units and the Class A Units pro rata in proportion to their respective Ownership Percentages. Provided that, notwithstanding anything to the contrary contained in this Section 3.1(b), all distributions made pursuant to this Section 3.1(b) on or prior to June 30, 2014 shall be made pursuant to Section 3.1(b)(2) and shall not be deemed a return of Capital Contributions.
Distribution Priority. The distribution of any net profit from the project is provided by the LLC as follows: FIRST, to repay the principal debt and interest on the loan provided by ▇▇▇▇ ▇▇▇▇▇▇, as stipulated in section 2; SECOND, to pay for any front-end reprieve, does not exceed $50,000; and THIRD, to repay each Investor's cash contribution, on the basis of a pro-rat to each Investor, until the total amount of $120,000 is distributed; FOURTH, to pay for any back-end deferral, does not exceed $50,000; and FIFTH, according to the following percentages: 45% to the LLC and/or its designated; 20% to Calliope Investment Company, LLC; 5% to ▇▇▇▇▇▇ ▇▇▇▇▇; and 3% in the talent pool project (including, but not limited to, actors, directors and any other third parties, as defined by ▇▇▇▇▇▇ ▇▇▇▇▇▇). 3.3 Appointment of the right to distribute. No investor can assign its distribution right here without the prior written consent of the LLC. Ltd. may assign all or part of its distribution rights to any third party, including, without limitation, PMW and/or a third-party production company, without the consent of any Investor. Recognition of investment and representation. 4.1 Investor Recognition. Each Investor understands: (a) That the distributions as evidenced by this Agreement are securities that were not registered under the Securities Act of 1933, as amended, 15 U.S.C. 15b et seq., California Act on 1968 securities or any other government securities laws ▇▇▇▇▇.▇▇) because LLC issues these securities, depending on exceptions to the registration requirements of the Securities Act, which provides for the issuance of securities not related to public offering; (b) The Ministry of Foreign Freedoms relied on the fact that each Investor should have distribution rights for his own investment account; and (c) this exemption from registration under the Securities Act may not be available if distribution rights have been acquired by the investor and investor for distribution. 4.2 Investor Representations. Every Investor imagines that: a) This Investor gets the right to distribute at the investor's expense, for the investment, not for the purpose of resale or distribution.
(b) Before making an investment, such an Investor researched the LLC and its business and project, and such an Investor made available to him all the information necessary for the Investor to make an informed decision to make an investment. Such Investor considers himself a person with experience and sophistication as an investor, ...
Distribution Priority. (a) In respect of payments to Shareholders and their Affiliates, the Company shall make payments in the following order of priority:
(i) Principal and accrued interest in respect of Startup Promissory Notes (accrued interest being paid first);
(ii) Inventory Promissory Notes;
(iii) Payments owed by the Company to the Shareholders in the ordinary course of business except under the Studio Agreements;
(iv) Net Revenues on the terms of the Studio Agreements; and
(v) Distributions of Distributable Cash in accordance with clause 14.1(b).
(b) The order or priority set out in clause 14.6(a) above may be altered at any time by Directors Approved Decision.
(c) The Shareholders and/or Affiliates may set-off any payments due to them from the Company under this clause 14.6 or otherwise against any payments to be made by them to the Company, and the Company may set-off any payments due to it from the Shareholders and/or Affiliates against payments to be made by it to the Shareholders and/or Affiliates under this clause 14.6 or otherwise, so that to the extent possible, only one payment will be made as between a Shareholder and/or Affiliate, and the Company. Any offsetting payments will be separately reported to the extent required by Accounting Standards, applicable law or for tax purposes.
(d) The parties agree that payment of principal and accrued interest in respect of Promissory Notes shall be made in accordance with clause 14.6(a) and that, notwithstanding the terms of the Promissory Notes, no Shareholder shall demand earlier payment of any principal or accrued interest in respect of any Promissory Note.
Distribution Priority. The Securityholder hereby covenants and agrees that, notwithstanding anything to the contrary in the CIP Distribution Rights Agreement:
(a) in connection with any Piggyback Distribution (as defined in the CIP Distribution Rights Agreement), to the extent that Obsidian and/or any of its Affiliates, on the one hand, and the Securityholder and/or any of its Affiliates, on the other hand, both propose to exercise piggyback rights under their respective Registration Rights Agreements, the entitlement to participate in the distribution of securities shall be allocated as between Obsidian and/or any of its Affiliates, on the one hand, and the Securityholder and/or any of its Affiliates, on the other hand, on a pro rata basis in proportion to their respective holdings of InPlay Shares at such time (with the InPlay Shares held by Obsidian and its Affiliates aggregated and the InPlay Shares held by the Securityholder and its Affiliates aggregated for the purposes of this determination); and
(b) in the case of an Obsidian Demand in respect of which the Securityholder would otherwise be entitled to exercise piggyback rights under Section 3 of the CIP Distribution Rights Agreement, the Securityholder will permit the Corporation to include in the distribution of securities: (i) first, the securities requested in the Obsidian Demand, (ii) second, the securities requested to be included in such distribution in accordance with the CIP Distribution Agreement, and (iii) third, other securities requested to be included in such distribution.]16