Mechanics

Pro rata

status: draft

A payment allocation where multiple classes receive principal or cash flow proportionally rather than by seniority.

What to watch

Senior investors usually resist pro rata principal unless performance tests are passing and enhancement is stable.

Referenced in 16 topics

Administration agreement documentation Advanced waterfall mechanics mechanics Amendments and waivers lifecycle-events Cash flow modeling accounting-valuation Cash operations and waterfall execution operations-lifecycle Intercreditor dynamics in distress playbooks Multi-party negotiation dynamics playbooks Portfolio financing asset-classes Risk retention rules legal Sample waterfall appendix Structural tests (OC/IC) mechanics Structuring deals for investor appeal playbooks Term sheet anatomy documentation The waterfall mechanics Trigger negotiation strategies mechanics Triggers, tests, and performance events mechanics