Structuring Waterfall Provisions in LLC and Partnership Agreements
Navigating Complex Distribution Structures, Minimizing Negative Tax Consequences
Recording of a 90-minute CLE/CPE webinar with Q&A
This CLE/CPE webinar will guide corporate and tax counsel on the various methods of structuring waterfall distribution provisions in LLC and partnership agreements. The panel will examine a variety of economic and tax considerations in the provisions, such as approaches to drafting priority returns (internal rate of return vs. preferred return, compounding, time value of money and the use of Excel references), relationships between distribution and allocation provisions, tax distributions, profits interests, liquidation provisions, and the implications of new IRS partnership audit rules.
- Waterfall provisions, generally
- Determining/drafting waterfall provisions
- Understanding economic arrangement of parties
- Priority returns
- Tailoring tax provisions to waterfalls
- Implications of new IRS partnership audit rules
The panel will review these and other key issues:
- What are the different types of waterfall provisions and when should each be used?
- What are the key considerations and best practices for counsel drafting and negotiating waterfall provisions in LLC or partnership agreements?
- What are the implications of new IRS partnership audit rules for tiered waterfall distributions?
- What are some pitfalls to avoid when tailoring partnership allocation provisions to waterfall provisions?
James R. Browne
Barnes & Thornburg
Mr. Browne has more than 30 years of experience in matters involving federal, state, and foreign taxes. He advises... | Read More
Mr. Browne has more than 30 years of experience in matters involving federal, state, and foreign taxes. He advises clients on the U.S. income tax aspects of domestic and international business transactions. He has experience handling complicated tax and financing issues for a diverse range of clients in various industries, including healthcare, manufacturing, energy, real estate, and financial services.Close
Phyllis A. Schwartz
Schulte Roth & Zabel
Ms. Schwartz focuses her practice on the structuring, formation and operation of private equity funds, including buyout... | Read More
Ms. Schwartz focuses her practice on the structuring, formation and operation of private equity funds, including buyout funds, venture capital funds, mezzanine funds, distressed funds and real estate funds. She represents both fund sponsors and investors in her practice. In addition to assisting fund sponsors with their internal management arrangements, succession planning and the creation of internal investment and co-investment vehicles, she has extensive experience with institutional investors and regularly advises clients on market terms of investment funds. She also advises private equity funds in connection with their investments in, and disposition of, portfolio companies and the establishment of capital call credit lines.Close
Griffin H. Bridgers
Hutchins & Associates
Mr. Bridgers' practice encompasses all areas of private wealth and family business. In addition to estate... | Read More
Mr. Bridgers' practice encompasses all areas of private wealth and family business. In addition to estate planning and estate administration, he is experienced in mergers and acquisitions, taxation, business transactions, franchising, commercial contracts, asset protection, executive compensation, employee benefits, qualified and non-qualified retirement plans, and nonprofit organizations. He counsels closely-held and family businesses, and nonprofit organizations, with their planning, succession, and liquidity needs in a variety of industries including tech, restaurant and retail, healthcare, manufacturing, construction, real estate, financial services, consulting, and professional staffing.Close