Limited Partnership Agreement (LPA)

The LPA is, in practical terms, the fund's constitution. It specifies how long the fund will operate, how capital will be called and returned, what fees and carried interest the general partner earns, what investments are permissible, and how conflicts of interest are managed. Every limited partner signs on to the same base document, which can run hundreds of pages in a mature institutional fund.

Families reviewing an LPA for the first time are often surprised by how firmly the terms favor the general partner. Provisions around extensions, valuation methodology, and excuse rights (the ability to sit out a specific investment) are negotiated before the fund closes, but once signed, the LPA governs. Changes afterward require supermajority LP consent and are rare.

One nuance worth understanding: the LPA is a baseline, not the complete picture. Certain large or early investors may negotiate side letters that layer additional rights on top of the LPA without changing the document itself. A qualified attorney should review any LPA before a family commits capital, as terms vary meaningfully across managers and vintages. See also considerations that arise at larger commitment sizes.