Subscription credit facilities, commonly referred to as “sub-lines” or “capital call facilities,” are a cornerstone of private equity finance. These facilities are secured by a bespoke collateral package that protects lenders...more
EXECUTIVE SUMMARY -
Subscription credit facilities rely on the obligations of investors to a private investment fund (“Fund”) to contribute their capital commitments to the Fund when called. From a subscription credit...more
2/26/2025
/ Breach of Contract ,
Capital Markets ,
Consumer Financial Products ,
Contract Terms ,
Credit Facilities ,
Creditors ,
Financial Services Industry ,
Investment Funds ,
Investors ,
Lenders ,
Limited Partnership Agreements ,
Loan Agreements ,
Loans ,
Private Equity ,
Private Equity Funds ,
Risk Management
Subscription credit facilities usually require the ability to make, receive, and enforce capital calls on a pro rata basis, whether directly or indirectly through a cascading pledge structure, on 100% of the pool of capital...more
A subscription credit facility is secured in part by the fund’s and its general partner’s (“GP”) right to call unfunded capital commitments from the fund’s investors, to receive capital contributions once funded and to...more
High net worth feeder funds (“HNW Feeder Funds”) have emerged as a strategic resource for private equity funds seeking additional sources of capital. The HNW Feeder Fund structure often involves a partnership between private...more
Recallable capital has become an increasingly common concept in subscription credit facilities. In this Legal Update, we explain the concept of recallable capital and its role in subscription credit facilities, as well as...more