Tier 3 of a European waterfall, executed after LPs have received return-of-capital and the preferred return. With a 100% catch-up (GP-favorable), all distributions flow to the GP until cumulative GP profit equals 20% of total profit; algebraically, if LP cumulative profit is L and the catch-up amount is x, the condition x = 0.20 · (L + x) solves to x = L/4. With a 50/50 catch-up (LP-favorable), distributions split evenly during catch-up, so the same target requires 0.5x = 0.20 · (L+x), giving x = 2L/3 — twice the catch-up duration. The catch-up structure affects when the GP receives carry, not the ultimate 80/20 split at full distribution.