Explain the waterfall from the agreement, not from memory

1 · Learn the move · Cognitive verifier

Every operating agreement's waterfall is its own document, and the model has read ten thousand others. Ask it to explain yours and it will blend them: a preferred return that compounds because most do, a catch-up that is not in your text. A development deal adds pieces a stabilised one lacks, each a place for that blending to hide: capital called in stages, what happens to a member who misses a call, a development fee paid outside the waterfall, and when the preferred return starts to accrue. The cognitive verifier makes the model check before it writes: for each tier, find the section, quote it, then restate it plainly, and mark anything the text does not define as a question for counsel. No worked example with numbers, because a split multiplied out in a chat reads like the real distribution. The gate holds: raising money from investors is a securities matter, the explanation is a draft for securities counsel's review, and it never says the structure is compliant.

Explain how this operating agreement pays members, tier by tier. Before each tier, find the section and quote it; then restate it in plain words. Cover capital calls, the development fee, when the preferred return starts, and any catch-up. Anything the text does not define reads [NEEDS: counsel - the question]. No worked numbers. [operating agreement, Articles 4, 6 and 7]