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Articles in this section

  • Getting Started
  • Adding Rules
  • Waterfall Templates: Overview and Descriptions
  • Catch-Up Template
  • Custom Template
  • Withholding/Fee Template
  • IRR Template
  • Preferred Return Template
  • Return of Capital Template
  • Splits Template
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Catch-Up Template

Overview

The Catch-Up Template is commonly used when a Managing Member Class or General Partner Class is entitled to receive funds from the General Members, or LPs, in the Project after those members have received a predetermined amount of cash. This can just be one stream, such as their preferred return, or multiple streams, including up to all distribution amounts. 

Pre-Conditions for use:

Must have at least two (2) distinct Classes in the Entity to build

 

The screenshot below shows the template outline, with five (5) mandatory fields and one optional field to complete:CU_1.png

Input Fields

Class to receive:  Pick the class that will receive the dollars generated by this rule. You can pick more than one class if you have three or more classes in your project

Percent (%): Input the percent that the Class is entitled to receive

Bucket (as a): Select from the drop-down the most appropriate bucket that describes what this cash is to be attributed to (often Promote or Excess Cash)

Of Class: Select the class that you need to evaluate to base your Catch Up

Select Distribution Sub-Type: Select the bucket(s) that contain the cash flow you need to base your percentage on. You can select more than one up to all options if the Catch Up is based on all Distributed Cash Flow.

Gross up the cash flow for the total amount to be split: This is an optional check box that will drive how the Catch up is calculated.  A sample follows and is available for reference in the application by selecting the “?”.

Gross Up Example:

Waterfall

  • Investor invests $100,000
  • Rule 1: Investor is entitled to an 8% Preferred Return Rate
  • Rule 2: Manager is entitled to a 20% Catch up

Distribution

  • Rule 1: Let’s say the Investor receives $8,000 of Preferred Return as stated in Rule 1.
  • Rule 2: 
    • If the checkbox is not selected: cu_2.png
    • The calculations will not include the cash flow from this rule. In this example the Sponsor would then receive the following: 
      $1,600 (20% of $8,000)
    • If the checkbox is selected: cu_3.png
    • The calculations will include the cash flow from this rule. In this example the Sponsor would then receive the following: 
      $2,000 (20% x ($8,000 + $2,000))
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Related articles

  • Custom Template
  • Preferred Return Template
  • Return of Capital Template
  • Withholding/Fee Template
  • Export by Investment: All Entities Export

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