Private Fund Side Letters: Negotiating and Drafting Key Terms, Financing and Other Concerns
A live 90-minute premium CLE webinar with interactive Q&A
This CLE webinar will discuss the documentation of side letters between private fund managers and investment partners who need or demand terms which may vary from the underlying partnership agreement. The panel will examine most favored nation clauses, transfer rights, excusal rights, special reporting provisions, and other terms common to these arrangements. The panel will also discuss the potential administrative and legal ramifications associated with side letters which fund sponsors must consider before entering into side letters.
- Introduction to side letters and circumstances under which they arise
- Common terms
- Most favored nation
- Excusal rights
- Enhanced reporting
- Factors to consider in a negotiation
- Credit facilities
- Regulatory concerns
- Impact on fund management: need for consistency
The panel will review these and other critical issues:
- When are side letters typically requested in a fund-raise, and why are they often preferable to an amendment of the partnership agreement?
- How do MFN rights impact the ability of the fund manager to negotiate side letters?
- What are the most common points of contention concerning transfer rights? Excusal rights? Increased reporting obligations?
- Why is an understanding of any existing or future fund financing arrangements necessary when entering into side letters?
Matthew (Matt) Posthuma
Ropes & Gray
Mr. Posthuma is a partner in Ropes & Gray’s private investment funds group in Chicago who focuses on the... | Read More
Mr. Posthuma is a partner in Ropes & Gray’s private investment funds group in Chicago who focuses on the formation of private investment funds and other transactions involving real estate companies, asset managers and financial institutions worldwide.Close
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