Allocation of Net Loss Generally Sample Clauses
The "Allocation of Net Loss Generally" clause defines how any net losses incurred by a partnership or joint venture are distributed among its members or partners. Typically, this clause outlines the method for calculating net losses and specifies the proportion or formula by which each party will bear a share of those losses, often based on their ownership interest or capital contributions. Its core practical function is to ensure that financial burdens are shared fairly and transparently, preventing disputes and clarifying each party’s responsibility in the event the business operates at a loss.
Allocation of Net Loss Generally. If immediately prior to any Revaluation Event (and after allocating net loss pursuant to Section 5.1(c)(iii), if applicable) any Common Unit Holder has a Capital Account Shortfall, the amount of net loss in connection with such Revaluation Event allocated with respect to (1) a Common Unit Holder will equal (x) the net amount of loss to be allocated in connection with the Revaluation Event (after application of Section 5.1(c)(iii), if applicable) minus the GP Revaluation Event Allocable Loss multiplied by (y) a fraction, the numerator of which is the Unit Surplus with respect to the Common Unit Holder and the denominator of which is the Aggregate Surplus; and (2) the General Partner will equal the GP Revaluation Event Allocable Loss.