There is a surprising amount of naiveté arising from that article. First, as you point out correctly in another post, it is inconceivable that a chunk of money will come back to investors from reserves (and also deposits, holdbacks, bonds, etc). Second, the 5% represents distributed proceeds; Rudin could easily be holding substantial undistributed profit.
Regarding the 20%, if what I read below is correct, it is 20% of the weekly PROFIT, not weekly gross. The latter is what conventionally relates to the 6% figure. 6% of $2mil=120k. 20% of (do we know what the nut is?) let's say $1.3mil=260k but 20% of $300k=60k. I would say that agreeing to the 20% deal is an assumption of more risk by the writers. |
