Limited Partnership Agreement Venture Capital for Germany

Limited Partnership Agreement Venture Capital Template for Germany

A comprehensive legal agreement governed by German law that establishes and regulates a limited partnership structure (Kommanditgesellschaft) specifically designed for venture capital investments. The document defines the relationship between the General Partner (Komplementär) and Limited Partners (Kommanditisten), outlining capital commitments, investment strategy, management rights, profit distribution, and regulatory compliance under German commercial law (HGB) and investment law (KAGB). It incorporates specific provisions for venture capital operations, including investment criteria, fund economics, and exit mechanisms, while ensuring compliance with both German domestic regulations and applicable EU directives.

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What is a Limited Partnership Agreement Venture Capital?

The Limited Partnership Agreement Venture Capital is a foundational document used when establishing a venture capital fund in Germany under the legal form of a limited partnership (Kommanditgesellschaft). This agreement is essential for venture capital firms, fund managers, and investors seeking to create a regulated investment vehicle that complies with German legal requirements while maintaining flexibility for international investment activities. The document encompasses crucial elements such as partnership structure, capital commitments, investment strategy, management provisions, profit distribution mechanisms, and regulatory compliance requirements. It must align with German Commercial Code (HGB), Investment Code (KAGB), and relevant EU regulations while addressing specific venture capital industry practices and standards. The agreement serves as the primary governing document for the fund's entire lifecycle, from formation through to dissolution.

What sections should be included in a Limited Partnership Agreement Venture Capital?

1. Parties: Identification of the General Partner (Komplementär) and Limited Partners (Kommanditisten)

2. Background: Context of the partnership formation and its intended purpose as a venture capital fund

3. Definitions: Key terms used throughout the agreement, including financial and technical terminology specific to VC operations

4. Formation and Name: Establishment of the partnership, registered office, and partnership name

5. Purpose and Investment Strategy: Fund's investment focus, permitted investments, and investment restrictions

6. Term and Termination: Duration of the partnership, extension options, and termination provisions

7. Capital Contributions: Commitments, capital calls, default provisions, and overcall rights

8. Management and Control: Powers and duties of the General Partner, investment decisions, and management fees

9. Advisory Board: Composition, appointment, powers, and procedures of the Advisory Board

10. Partners' Rights and Obligations: Voting rights, information rights, and obligations of both GP and LPs

11. Distributions and Allocations: Distribution waterfall, carried interest, clawback provisions, and tax allocations

12. Transfers and Withdrawals: Transfer restrictions, conditions for LP withdrawals, and GP removal rights

13. Reporting and Valuations: Financial reporting obligations, valuation methods, and auditor appointments

14. Confidentiality: Confidentiality obligations and permitted disclosures

15. Governing Law and Jurisdiction: Application of German law and jurisdiction for disputes

What sections are optional to include in a Limited Partnership Agreement Venture Capital?

1. Key Person Provisions: Used when specific individuals are crucial to the fund's operation, defining key person events and consequences

2. Co-Investment Rights: Include when offering co-investment opportunities to LPs or related parties

3. ESG Provisions: Environmental, Social and Governance requirements, increasingly common for institutional investors

4. Parallel Fund Structure: Required when establishing parallel vehicles for different investor categories

5. Strategic Investors Rights: Special provisions for strategic investors with additional rights or obligations

6. AIFMD Compliance: Detailed compliance provisions if the fund falls under AIFMD regulations

7. Tax Structuring Provisions: Specific provisions for tax-sensitive investors or cross-border structures

What schedules should be included in a Limited Partnership Agreement Venture Capital?

1. Schedule 1: Limited Partners and Commitments: List of all Limited Partners and their capital commitments

2. Schedule 2: Investment Guidelines: Detailed investment criteria, restrictions, and concentration limits

3. Schedule 3: Management Fee Calculations: Detailed provisions for management fee calculation and payment

4. Schedule 4: Distribution Waterfall: Detailed mechanics of the distribution waterfall and carried interest calculations

5. Schedule 5: Subscription Agreement Form: Standard form for admission of new Limited Partners

6. Schedule 6: Advisory Board Rules: Detailed procedures and rules governing the Advisory Board

7. Schedule 7: Valuation Policy: Detailed methodology for portfolio company valuations

8. Appendix A: FATCA/CRS Compliance: Tax reporting and compliance requirements

9. Appendix B: Anti-Money Laundering Requirements: AML procedures and requirements for investor onboarding

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

Germany

Publisher

Genie AI

Cost

Free to use
Relevant legal definitions
Clauses
Relevant Industries

Financial Services

Technology

Healthcare

Biotechnology

Software

Clean Technology

E-commerce

Digital Media

Telecommunications

Industrial Technology

Consumer Goods

Professional Services

Real Estate Technology

Fintech

Artificial Intelligence

Cybersecurity

Relevant Teams

Legal

Finance

Compliance

Risk Management

Investment

Fund Administration

Investor Relations

Tax

Operations

Due Diligence

Executive Management

Corporate Governance

Relevant Roles

Fund Manager

Managing Partner

General Counsel

Chief Financial Officer

Investment Director

Compliance Officer

Risk Manager

Portfolio Manager

Legal Counsel

Tax Director

Investment Committee Member

Fund Administrator

Investor Relations Manager

Due Diligence Officer

Managing Director

Partnership Secretary

Industries
Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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