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Uncovered LPA risks: LP default, GP co-invest terms, unresolved LP disputes.

Community Member
What are the real failure-mode scenarios that the LPA template may not already cover? Ie. What happens if an LP can't pay a capital call? If I want to co-invest personally in a deal? If a dispute with an LP can't be resolved directly?
1 reply
Community Member
I think those are exactly the kinds of situations that are easy to overlook. The LPA probably covers the main framework, but I'm not sure it can anticipate every practical scenario. Things like an LP defaulting on a capital call, a GP wanting to co-invest personally, or a dispute that can't be resolved could require specific procedures, approvals or remedies. I guess the key is understanding where the template gives enough protection and where the fund needs additional provisions or processes.

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