# Commitment

A **commitment** is the legally binding amount an LP agrees to invest in a fund when they sign the [subscription document](/fund-mechanics/subscription-document.md). It is not cash paid upfront — it is a promise to transfer cash on demand when the GP issues a capital call.

## Fund-Level vs LP-Level Commitment

**LP commitment** is the amount a single LP has committed. The sum of all LP commitments is the **total fund commitment** (or **fund size**). The GP sets a target fund size and a hard cap during fundraising; closes are held until the target is reached or the deadline expires.

See [LP Commitment](/fund-mechanics/lp-commitment.md) for how individual LP commitments are tracked in Gildi.

## How Commitments Are Drawn Down

The GP draws on commitments progressively through capital calls:

```
Paid-in capital     = sum of all settled call contributions
Unfunded commitment = Total commitment − Paid-in capital
```

Each capital call reduces the LP's unfunded balance. An LP's commitment is fully drawn when their unfunded balance reaches zero.

## Recallable Distributions

Some LPAs allow the GP to **recall** distributions — distributions returned to LPs that the GP retains the right to call back within a stated window. If a distribution is recallable, it reinstates a portion of the LP's unfunded commitment.

Whether recalls are permitted and under what conditions is defined in the LPA on a per-fund basis. Gildi tracks this at the fund level and adjusts unfunded balances automatically when a recall is processed.

## Commitment Adjustments

Commitments can be adjusted in limited circumstances:

* **Subsequent close dilution** — when a new LP joins, total fund size grows and per-LP ownership percentages change, but individual commitment amounts do not change.
* **Mutual amendment** — GP and LP can agree to reduce a commitment (e.g., if an LP suffers financial hardship), but this requires a formal amendment and may affect equalization calculations for other LPs.
* **Transfer** — most LPAs prohibit LP commitment transfers without GP consent. Gildi supports commitment transfers with a full audit trail.


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