Priorities Clause Clause Samples

A Priorities Clause establishes the order in which competing claims or interests are addressed or satisfied, typically in the context of debts, liens, or security interests. In practice, this clause specifies which party's rights take precedence if multiple parties have claims to the same asset or funds, such as when several creditors have security interests in a borrower's property. By clearly defining the hierarchy of claims, the Priorities Clause helps prevent disputes and ensures that parties understand their position relative to others, thereby reducing uncertainty and legal risk.