Are distributions to Aplus Class C Unit holders included in the Partnership's consolidated cash flows?

According to Aplus's 2024 Franchise Disclosure Document, distributions to Class C Unit holders do not impact the Partnership's consolidated cash flows. The FDD specifies that the Partnership has 16,410,780 Class C Units outstanding, all held by wholly-owned subsidiaries. These units are not convertible or exchangeable into Common Units and are non-redeemable. They are entitled to receive distributions of available cash at a fixed rate of $0.8682 per quarter for each Class C Unit outstanding, excluding cash derived from Sunoco Retail activities.

The document clarifies that distributions to Class C Unit holders are excluded from total cash distributions and the allocation of limited partners' interest in net income. This means that while these units receive distributions, those payments do not affect the overall cash flow reported in the Partnership's consolidated financial statements.

For a prospective Aplus franchisee, this information is relevant because it provides insight into the financial structure of the Partnership. Understanding how different classes of units are treated in terms of distributions and their impact on consolidated cash flows can help franchisees assess the financial stability and distribution policies of the company. It also clarifies that the distributions to these specific unit holders do not dilute or affect the cash distributions available to limited partners, which may include franchisees who hold units in the Partnership.