informed - Morgan Lewis

informed

Continuing Legal Education Presentations for

Private Investment Funds

international presenceSome 1,400 lawyers in 25 offices across the United States, Europe, Asia, and the Middle East

Almaty Beijing Boston Brussels Chicago Dallas Dubai* Frankfurt Harrisburg

Houston Irvine London Los Angeles Miami Moscow New York Palo Alto Paris

Philadelphia Pittsburgh Princeton San Francisco Tokyo Washington Wilmington

*In association with Mohammed Buhashem Advocates & Legal Consultants

fund formation

1A Fundamentals of private investment fund formation

topics to be discussed include:

• Legal structures

• Regulatory framework

• Offering process and documentation

• Negotiating and closing process vehicles

1C Current institutional investor concerns


• Legal overview of the current institutional investor marketplace

• New and changing private investment fund terms and conditions

• New economic structures in the changing limited partner/general partner balance transaction

1DLiquidity alternatives for investors: the private investment fund secondary market


• Overview of the secondary market

• Structuring alternatives in a secondary transaction

• The purchase and sales process

• Requisite documentation in a secondary transaction

1BPrivate investment funds, separate managed accounts, and customized investment vehicles


• Overview of current terms and conditions

• Structuring alternatives

• Current issues and concerns regarding structuring managed accounts and customized vehicles

Our Continuing Legal Education (CLE) Course Menu and Customized Courses As part of our ongoing commitment to keep you up to date on legal developments, we offer the CLE courses listed in this brochure as a service to your in-house staff in order to facilitate compliance with CLE requirements. We can also tailor a CLE course to meet your specific needs and interests. If you are interested in learning more about the complimentary CLE courses offered in this brochure, please feel free to contact one of the lawyers listed on the back cover.

The Morgan Lewis Private Investment Funds Practice

Our team of more than 130 lawyers has created one of the most comprehensive private fund legal practices in the industry and has earned the trust of its clients. We represent all types of onshore and offshore private investment funds, including credit/distressed credit funds, private equity funds, mezzanine funds, funds of funds, secondary funds, infrastructure funds, real estate funds, cleantech funds, venture capital funds, master-feeder funds, hedge funds, activist funds, and corporate governance funds.

We advise our clients on all aspects of fund organization, including lead and incubation investment negotiations, domicile selection, exemption from registration, and fee and compensation structures. Our counsel extends through all stages of investment, encompassing transactions on global equity and fixed income markets; derivatives; leveraged acquisitions and recapitalizations; tender offers; going-private transactions; management buyouts; public offerings; seed, early-stage, and growth-stage venture financings; mezzanine financings; and other special situations.

Morgan Lewis has more than 20 partners who worked for the Securities and Exchange Commission (SEC), as well as prominent alumni of the Internal Revenue Service (IRS), the Financial Industry Regulatory Authority (FINRA) and its predecessors, the Money Management Institute (MMI), the Financial Services Authority (FSA), the National Futures Association (NFA), the Bank Insurance & Securities Association (BISA), the Commodity Futures Trading Commission (CFTC), and the Department of Justice.

fund formation continued litigation/securities enforcement

2A Overview of SEC enforcement processes and practices


• Opening investigations

• Ranking, reviewing, and documenting the status of investigations

• Producing documents in response to subpoenas/privilege issues

• Wells process

• Closing an investigation

• Communicating with senior SEC personnel

• Parallel investigations with the Department of Justice, self-regulatory organizations, and state regulators

2B Understanding insider trading laws


• What is material information?

• What is nonpublic information?

• When does a firm have a duty to restrict and not speak?

• Identifying and managing insider trading risks for private investment funds

• Recent cases and investigations involving private investment funds and insider trading

2C Current topics in SEC enforcement involving investment advisers


• Statistics reflecting recent enforcement trends

• Selected SEC actions

• SEC examination and enforcement priorities

• Other enforcement developments

2D Current topics in private investment fund litigation

Content and topics to be determined based on the most significant issues and litigation in the period leading up to the presentation.

1E Structuring the upper tier


• Legal structure

• Vesting

• Employee participation

• Preparing for and handling GP separations

1G Charitable investment funds


• Tax issues for nonprofit sponsors

• Social investing

• Program-related investing

• Mission-related investing

1H Corporate-sponsored funds and corporate strategic investing


• The various models employed for strategic venture investing

• Compensation issues

• Tax and accounting issues

• Mission-related investing

1F Managing legal liabilities and litigation risks of being a fund manager


• Risks involved in the sale of securities

• Fiduciary duties owed to investors

• Risks arising from service on boards of directors of portfolio companies

• Regulatory compliance

• Employer-related liabilities

• Insurance coverage

labor and employment

3A Employment issues for private fund managers


• The primary federal antidiscrimination statutes

• Sexual harassment: a brief primer on managing and minimizing risk

• Day-to-day management considerations

• Postemployment restrictive covenants

• Whistleblower protections for employees, such as under the Sarbanes-Oxley Act of 2002

3B Managing corporate diversity initiatives


• Business and legal justifications for diversity

• The tension between diversity and reverse discrimination claims

• Managing typical corporate diversity initiatives to reduce legal risk

mergers and acquisitions

5A Current topics in merger and acquisition law


• Recent developments in Delaware case law

and transactional practice affecting recourse

and deal certainty

• General considerations when buying and

selling a fund manager

• Recent developments in shareholder activism

investment management

4A Regulatory developments affecting private investment funds


• Form PF, CFTC licensing, and navigating form ADV

• Promotion and regulation of centralized clearinghouses for credit default swaps (CDSs)

• Increasing net worth requirements for private investment fund investors

• JOBS Act

4B Pending legislation affecting private investment funds

Content and topics to be determined based on the most significant pending legislation in the period leading up to the presentation.

4C Derivatives and futures


• Documentation

• Collateralization

• Insolvency

• Workout of derivatives

• Synthetic and leveraged exposures

• Dodd-Frank derivative reform

tax

8A Overview of tax issues relevant to private investment funds


• Comparison of structures

• Unrelated business taxable income (UBTI) and effectively connected income (ECI) concerns

• Investor versus trader: Potential for IRC Section 475 mark-to-market election

• Foreign Account Tax Compliance Act (FATCA) and Report of Foreign Bank and Financial Accounts (FBAR) compliance

• U.S. and foreign withholding tax

• Non-U.S. tax

• State and local tax

8B Recent tax developments affecting private investment funds


• Structure of IRC Sections 409A and 457A (see 6B)

• Proposed taxation of carried interest as ordinary income

• Proposed changes in tax treatment of non-U.S. entities and investments

• Potential alternatives to traditional carry and management fee

• Changes in financial statement and tax return preparer standards

• Special issues for alternative investment, hybrid, crossover, and side-pocket funds

6A ERISA issues for private investment funds


• Application of plan asset rules• Common prohibited transaction exemptions• Performance fees• Reporting and disclosure rules

6B Deferral issues for private investment funds


• Common structures• IRC Section 409A• IRC Section 457A

ERISA

FCPA

7A Foreign Corrupt Practices Act issues relating to private investment funds


• Overview of FCPA

• Compliance issues when making international investments

• Handling fund investor due diligence

• Compliance programs

knowledge

morgan lewis fast factsfirmwide

International firm with some 1,400 lawyers in 25 offices across the United States, Europe, Asia, and the Middle East

Ranked as one of the top law firms in Corporate Counsel magazine’s listing of “Who Represents America’s Biggest Companies?” (2013)

More than 140 lawyers listed in Chambers USA 2013

private investment funds

One of the largest international private fund investor representation practices

Ranked as one of the industry’s top private fund sponsor and formation practices

Ranked “#1 Most Active Law Firm” globally, based on the number of private funds worked on for limited and general partners, by the Dow Jones Private Equity Analyst (2013)

Ranked as a leading firm in the Private Equity and Hedge Fund Formation practice areas in Chambers USA (2013)

Ranked as a leading firm in the Private Equity Funds, Alternative/Hedge Funds, and Venture Capital and Emerging Companies practice areas in The U.S. Legal 500 (2013)

Represent 5 of the 10 largest private equity funds of funds complexes (measured by AUM)

Represent many leading private funds in complex regulatory enforcement and securities litigation

Represent more than 780 private equity, venture capital, mutual, and hedge funds

knowledge

This communication is provided as a general informational service to clients and friends of Morgan, Lewis & Bockius LLP. It should not be construed as, and does not constitute, legal advice on any specific matter, nor does this

message create an attorney-client relationship. These materials may be considered Attorney Advertising in some states. Please note that the prior

results discussed in the material do not guarantee similar outcomes. The photos in this material are dramatizations.

© 2014 Morgan, Lewis & Bockius LLP

1701 Market Street • Philadelphia, PA 19103-2921 P: 215.963.5000 F: 215.963.5001

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contacts

informed

Louis H. SingerPractice Group LeaderPartner, New YorkP: +44.020.3201.5545P: +1.212.309.6603E: [email protected]

Noel AinsworthPartner, LondonP: +44.020.3201.5585E: [email protected]

Thomas J. CartwrightPartner, LondonP: +44 (0)20 3201 5671E: [email protected]

Steven M. CohenPartner, PrincetonP: +1.609.919.6604E: [email protected]

Sean GraberPartner, PhiladelphiaP: +1.215.963.5598E: [email protected]

Ethan W. JohnsonPartner, MiamiP: +1.305.415.3394E: [email protected]

Ayman A. KhaleqPartner, Dubai*P: +971 4 319 7936 P: +971 50 5519268E: [email protected]

Timothy W. LevinPartner, PhiladelphiaP: +1.215.963.5037E: [email protected]

Paul C. McCoyPartner, San FranciscoP: +1.415.442.1385E: [email protected]

Peter M. PhlegerPartner, San FranciscoP: +1.415.442.1096E: [email protected]

Georgette A. SchaeferPartner, New YorkP: +1.212.309.6607E: [email protected]

Torsten SchwarzePartner, FrankfurtP: +49.69.714.00.763E: [email protected]

Jedd H. WiderPartner, New YorkP: +1.212.309.6605E: [email protected]

William J.G. YongePartner, LondonP: +44.020.3201.5646E: [email protected]

connect with us:www.morganlewis.com

*In association with Mohammed Buhashem Advocates & Legal Consultants

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informed - Morgan Lewis