By Justin Partington, Global Head of Fund and Asset Managers
Side letters have long been a significant element of fund formation processes. But as LPs have grown more sophisticated and fund structures more complex, the use of side letters has expanded as more investors seek to secure tailored terms – bringing significant operational challenges for fund managers.
While side letter agreements can be a necessity for some LPs and a useful tool for GPs when negotiating new LP commitments during fundraising, they need to be monitored carefully. Without careful planning, side letters can easily reach hundreds of pages, complicate compliance obligations and negatively impact both fund operations and investor relations.
In our new whitepaper, jointly prepared with leading law firm Kirkland & Ellis, we aim to provide fund managers with clear and practical guidance on:
- Operational, compliance and regulatory considerations relating to side letters
- The most common side letter provisions
- Side letter best practices to help streamline onboarding and admin requirements while minimising compliance burdens
Download our guide to side letters
Need more help?
At IQ-EQ, we’re well versed in the enhanced administrative and reporting requirements involved in utilising side letters. If you’d like to discuss any of the insights contained within our guide or find out more about the support we could offer your firm, please don’t hesitate to get in touch.
