Co-investments Guide: Issues to Spot and Raise When Making a Private Equity Direct Co-investment


Summary

This practice note is intended to provide a guide for co-investors' counsel to identify and understand key topics that should be raised in negotiating terms for co-investments, and which initial drafts of the co-investment documents often do not address or address inadequately. This practice note contemplates a transaction structured as a minority co-investment of typically less than 10% in a private company in the United States. Needless to say, this guide is not intended to cover every issue that could arise in co-investment transactions. Other issues may be relevant depending on various factors, including, for instance, the type of security being acquired, the specific economic terms of the security, and the structure and size of the investment. The focus of this practice note is to highlight select items that are typically not addressed in the initial drafts of co-investment documents and which most lead sponsors, when asked, will address. The Appendix to this practice note is a ...