Structuring Direct Lending Funds: Open-End vs. Closed-End Structures
Recurring Regulatory, Valuation, and ERISA Considerations; Structures to Confront Pervasive Tax Issues
Note: CPE credit is not offered on this program
A live 90-minute premium CLE video webinar with interactive Q&A
This CLE course will examine issues associated with the formation and operation of direct lending funds, including those organized to lend to small and medium-sized businesses, certain real estate developers, and other real estate market participants.
Outline
- Comparing open to closed-end structures, including the following key considerations: liquidity and valuation
- Avoiding liquidity mismatches
- Frequency of withdrawal periods
- Length of notice periods
- Gates
- More current strategies
- Length of payout periods
- Novel payout calculations (e.g., disassociate from NAV?)
- Selected structures/strategies for U.S. federal income tax issues posed by direct lending strategies
- Issues for U.S. taxable investors
- Strategies for non-U.S. investors
- Foreign-owned U.S. corporate lenders
- Post-tax reform: Are corporate structures, even for U.S. taxable investors, the wave of the future?
- Recurring regulatory issues unique to direct lending funds
- Conflicts
- Investment Advisers Act Section 206: principal transactions
- Conflicts among typical affiliates
- Credit funds: originator, servicer, principal investment vehicles
- RE related
- Balancing Securities Act/private placement requirements with marketing for business of the fund
- Conflicts
Benefits
The panel will review the following key issues, among other matters:
- Comparing open to closed-end structures, including liquidity and valuation
- U.S. federal income tax issues posed by direct lending funds and strategies for addressing them
- Recurring regulatory issues unique to the direct lending funds
- Ramifications of a higher interest rate environment
Faculty
Steven Huttler
Partner
Kilpatrick Townsend & Stockton
Mr. Huttler has extensive experience in corporate, finance, investment fund, securities, and family office... | Read More
Mr. Huttler has extensive experience in corporate, finance, investment fund, securities, and family office matters, including the representation of U.S. and foreign investment funds, large corporate issuers, underwriters and family offices, in various registered public and private offerings of debt and equity securities totaling in excess of $15 billion. In recent years, he has served as corporate counsel to many private investment funds and partnerships, including those based in the U.S. and in offshore jurisdictions, such as the Cayman Islands, Bermuda, the British Virgin Islands, Ireland, Luxembourg, Isle of Man, Jersey, Guernsey, Cyprus, Mauritius, United Kingdom, Austria, Russia, India, and Gibraltar. Mr. Huttler's legal practice has exposed him to a variety of fund clients, from large mutual funds to sophisticated offshore funds to small start-up hedge funds and financial industry entrepreneurs. His practice has included the structuring and establishment of start-up funds and managed accounts; advising management companies and fund managers on compensation structures; the restructuring and reorganization of such funds; structuring and advising on fund trades; and a range of sophisticated transactional work for such funds (including PE and VC transactions).
Close
Seth Lebowitz
Partner
Sadis & Goldberg
Mr. Lebowitz advises clients on the tax-efficient planning and execution of a broad range of transactions, with a... | Read More
Mr. Lebowitz advises clients on the tax-efficient planning and execution of a broad range of transactions, with a particular focus on the formation, operation and investing activities of private equity and hedge funds.
CloseEarly Discount (through 07/11/25)