What does the below command means
$cat <<% >abc.txt
my understanding is that it cats % and outputs to abc.txt... assuming % is referencing some file.
and what about '<<'? what's that all about?
It's an incomplete 'here document'.
Search down the script in question until you find a line with a single % on it. Any text between the line you posted and the line with a % on it will end up in abc.txt