Fund structure and roles

LPA (Limited Partnership Agreement)

The LPA, usually called the limited partnership agreement, is the legal agreement that governs a limited partnership and the rights and obligations of its GP and LPs. It covers fees, distributions, investment restrictions, governance, defaults, and fund extensions, among other matters. Review it before you sign, and consider legal advice.

Example: The LPA sets out the fund’s carry, capital-call, key-person, and extension provisions.

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Knowing the language helps you follow the conversation. Knowing what to ask is how you participate in it.

Understanding the terms is a first step. The Aligned Capital Program uses them to teach you how to evaluate a fund and prepare the questions to ask its manager.

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