This sample form, containing Clauses Relating to Preferred Returns document, is usable for corporate/business matters. The language is easily adaptable to fit your circumstances. You must confirm compliance with applicable law in your state. Available in Word format.
Just like the weather, preferred returns can change! They can be set for a specific period and might be renegotiated based on the investment performance.
Calculating a preferred return is like figuring out the tip at a restaurant. You take a percentage of the investment amount and apply it over a specific time frame.
Not quite! A preferred return is preferred, but it isn’t set in stone. It means investors get the first portion, but if profits don’t roll in, they might not see that pie.
A preferred return is like a guaranteed slice of pie for investors. It’s the minimum profit they get before other profits are shared.