Using Profit Interest Units as an annual bonus plan for a CEO?

by a searcher from Brigham Young University

11 months ago

Does anyone have any experience with using profit interest units as an annual bonus plan for a CEO we're putting in place at a LLC?  There's a lot written about how PIUs are used during exits, but what about setting EBITDA thresholds for the PIUs and then paying out dividends based on them on an annual basis?  Any thoughts or insights would be greatly appreciated!

1 like
54 views
1 comment

professional from Walsh College of Accountancy and Business Administration

Profit units are used in a variety of ways beyond just an exit. It all comes down to what you're trying to accomplish, the timing of when they share, when you want the units to vest, and the hurdles you will include in the targeted capital account waterfall. email me at --@----.com and we can set up a call to discuss.

11 months ago | like reply | 0 likes

More on Searchfunder

Just Closed on My First Deal! Reflections and Takeaways for other Searchers

45,152 transactions are available on Searchfunder (now searchable by keyword)

Now everyone has unlimited IBISWorld access

Family office looking for traditional searchers

Examples of self-funded searcher websites

Investor seeking Self-Funded Search Deals

What are market terms for Seller Notes?

2 Best Ways To Find Motivated Sellers, Off-Market Deals

Searchfunder is an online community and toolkit for searchfunds. Over 80% of those involved in searchfunds maintain a Searchfunder.com account to help them network, problem solve challenges, and keep up with the industry.

We maintain partnerships with database providers that make searching more effective, efficient and affordable along with features that help searchers find deals and investors and vice versa.