The Carried Clause Samples

The Carried clause defines the rights and entitlements of the party known as the "Carried" in a financial or investment arrangement, typically in private equity or venture capital contexts. This clause specifies how the Carried party receives a share of profits—often a percentage of returns above a certain threshold—without being required to contribute capital to the investment. For example, a fund manager may be entitled to 20% of profits after investors have received their initial investment back. The core function of this clause is to incentivize the Carried party to maximize returns, while clearly outlining their share of profits and aligning their interests with those of the investors.