medium · Private Equity pe-core
A GP is negotiating an American-style waterfall for a new venture fund. LPs are concerned about 'phantom carry' where the GP receives carry on early winners that is not justified by the total fund return.
What specific mechanism is usually mandated in the LPA to protect LPs in this scenario?
- GP Clawback with Escrow
- Most Favored Nation (MFN) clause
- No-fault divorce clause
- Key Person provision
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