Private Equity And Hedge Funds: Regulatory Analysis And Structural Overview

At Fox Rothschild LLP, we have a wealth of experience in creating and forming private equity and hedge funds. Over the years, our strategy has been to work with our clients to develop these entities while also assisting them in their ongoing business operations. As a result of the breadth of our experience, we have produced this handbook as a reference guide for all those who are interested in this exciting field, from potential entrants to those who may be more established and need a quick reference guide.

Anticipating your interest in these fund offerings, the following is meant to provide a summary of the most common compliance-related issues that private equity and/or hedge funds face. Of course, every issue that you may encounter in raising capital is not covered. Therefore, if an issue should arise, we suggest that you contact us with any questions or concerns. Please keep in mind that any deviation from the current statutory and regulatory structure (primarily based in exemptions and exceptions to provisions of the Securities Act of 1933, the Securities Exchange Act of 1934, the Investment Advisers Act of 1940 and the Investment Company Act of 1940) for your private equity or hedge fund could subject you and your associates to significant liability.

This handbook has been prepared in two parts. The first part provides a summary of regulatory issues affecting hedge fund formation and operation. The second part contains a generic "Summary of Terms," similar to what would be incorporated within a typical private placement memorandum. In the "Summary of Terms," we have tried to identify the types of issues that would be relevant for you as a start-up fund and as a baseline for discussion and modification.*

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The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.