Limited Partnership Term Sheet for the Netherlands

Limited Partnership Term Sheet Template for Netherlands

A Limited Partnership Term Sheet under Dutch law (Commanditaire Vennootschap) is a preliminary document that outlines the key terms and conditions for establishing a limited partnership in the Netherlands. This document serves as the foundation for the subsequent partnership agreement and details essential elements such as capital contributions, management rights, profit-sharing arrangements, and transfer restrictions. Governed by Dutch civil and commercial law, particularly the Dutch Civil Code (Burgerlijk Wetboek) and Commercial Code (Wetboek van Koophandel), the term sheet establishes the framework for the partnership structure while ensuring compliance with Dutch regulatory requirements and tax regulations.

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What is a Limited Partnership Term Sheet?

The Limited Partnership Term Sheet is a crucial preliminary document used in the Netherlands when parties intend to establish a Commanditaire Vennootschap (CV). It serves as a roadmap for the final partnership agreement and is typically used in investment structures, real estate ventures, and professional service arrangements. The document outlines essential terms including partnership structure, capital commitments, management rights, profit sharing, and transfer restrictions. While not legally binding in its entirety, it represents the parties' serious intention to form a partnership and often includes certain binding provisions such as confidentiality and exclusivity. The term sheet must align with Dutch partnership law requirements and consider tax implications under Dutch legislation. It's particularly important in scenarios involving international investors or complex investment structures where clarity on key terms is essential before proceeding with detailed documentation.

What sections should be included in a Limited Partnership Term Sheet?

1. Parties: Identification of the General Partner(s) and Limited Partner(s), including full legal names and addresses

2. Background: Brief context of the partnership formation and its intended purpose

3. Definitions: Key terms used throughout the term sheet

4. Partnership Structure: Legal form, name, and domicile of the partnership

5. Purpose: Defined scope of partnership activities and business objectives

6. Capital Contributions: Initial and subsequent capital contributions from all partners

7. Ownership and Profit Sharing: Distribution of partnership interests and profit-sharing ratios

8. Management Rights: Powers and limitations of the General Partner(s) in managing the partnership

9. Transfer Restrictions: Limitations on transfer of partnership interests

10. Term and Dissolution: Duration of the partnership and conditions for dissolution

11. Distributions: Policy and mechanics for profit distributions

12. Expenses and Fees: Management fees, partnership expenses, and cost allocation

13. Confidentiality: Basic confidentiality obligations of the parties

14. Governing Law: Confirmation of Dutch law application and jurisdiction

What sections are optional to include in a Limited Partnership Term Sheet?

1. Investment Strategy: Detailed investment criteria and limitations - include for investment-focused partnerships

2. Key Person Provisions: Requirements for key personnel involvement - relevant when specific individuals are crucial to operations

3. Co-Investment Rights: Terms for co-investment opportunities - include when partners may participate in related investments

4. ESG Provisions: Environmental, Social and Governance requirements - include for partnerships with ESG focus

5. AIFMD Compliance: Alternative Investment Fund Managers Directive provisions - include if partnership qualifies as an AIF

6. Tax Treatment: Specific tax structuring provisions - include for complex tax structures or international partners

7. Limited Partner Advisory Committee: Structure and powers of LP advisory committee - include for larger partnerships with multiple LPs

8. Reporting Requirements: Detailed reporting obligations - include for partnerships with institutional investors

What schedules should be included in a Limited Partnership Term Sheet?

1. Schedule 1: Capital Commitments: Detailed breakdown of each partner's committed capital contributions

2. Schedule 2: Partnership Interests: Current ownership percentages and classes of interests

3. Schedule 3: Management Fee Calculation: Detailed calculation methodology for management fees

4. Schedule 4: Distribution Waterfall: Detailed mechanics of the distribution waterfall

5. Appendix A: Subscription Process: Steps and requirements for executing partnership subscription

6. Appendix B: KYC Requirements: Required know-your-customer documentation for partners

7. Appendix C: Tax Considerations: Summary of key tax implications and structuring considerations

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

Netherlands

Publisher

Genie AI

Cost

Free to use
Clauses
Relevant Industries

Private Equity

Venture Capital

Real Estate

Infrastructure

Professional Services

Investment Management

Asset Management

Financial Services

Technology

Healthcare

Energy

Sustainable Industries

Agriculture

Manufacturing

Relevant Teams

Legal

Finance

Tax

Compliance

Risk Management

Investment

Fund Administration

Corporate Governance

Partnership Management

Business Development

Operations

Relevant Roles

Managing Partner

Investment Director

Chief Financial Officer

General Counsel

Tax Director

Fund Manager

Investment Manager

Legal Counsel

Partnership Administrator

Compliance Officer

Risk Manager

Investment Committee Member

Managing Director

Finance Director

Company Secretary

Senior Partner

Corporate Lawyer

Financial Controller

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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