{"concept_id":"ALTSS-LPA-001","slug":"limited-partnership-agreement","canonical_name":"Limited Partnership Agreement","acronym":"LPA","aliases":["LPA","partnership agreement","fund agreement"],"kind":"document","authority":"industry","facets":["GOV","REG"],"domains":["FUND-TERMS"],"display_title":"Limited Partnership Agreement (LPA)","search_aliases":["what is an lpa","limited partnership agreement private equity","key terms in an lpa","lpa vs ppm vs side letter","ilpa model lpa"],"one_sentence_definition":"A limited partnership agreement (LPA) is the governing contract of a private fund organised as a limited partnership, setting out its purpose, term, capital commitments, economics, governance and the rights and obligations of the general partner and the limited partners.","plain_english":"The LPA is the fund's constitution. It says what the fund may invest in and for how long, how capital is called and returned, what the manager is paid, how profits are split, what LPs can vote on and what happens if things go wrong. Every LP signs the same LPA; individual variations go into side letters.","parent_concepts":[],"child_concepts":["lpac","key-person-clause","side-letter","waterfall"],"related_concepts":["private-placement-memorandum","subscription-agreement","ilpa-principles","ilpa-model-lpa","limited-partnership","lp-consent-rights"],"comparison_concepts":[],"not_the_same_as":[{"slug":"private-placement-memorandum","distinction":"A private placement memorandum (PPM) is a disclosure document; the LPA is the binding contract that governs the fund."},{"slug":"side-letter","distinction":"A side letter varies terms for one LP; the LPA applies to all."},{"slug":"subscription-agreement","distinction":"The subscription agreement admits an investor and records its commitment and representations; the LPA governs the partnership."}],"formula_ids":[],"worked_examples":[],"sections":[{"heading":"What an LPA covers","paragraphs":["| Area | Typical provisions |\n|---|---|\n| Formation and term | Name, purpose, [fund term](/glossary/term-fund-life) and extensions, dissolution and wind-down |\n| Capital | Commitments, [capital calls](/glossary/capital-call), defaulting LP remedies, subsequent closings and equalisation |\n| Investment | [Investment period](/glossary/investment-period), investment restrictions and concentration limits, borrowing and guarantees, recycling |\n| Economics | [Management fee](/glossary/management-fee), fund expenses, [distribution waterfall](/glossary/waterfall), [clawback](/glossary/clawback), fee offsets, GP commitment |\n| Governance | [LPAC](/glossary/lpac), [key person clause](/glossary/key-person-clause), removal for cause, [no-fault divorce](/glossary/no-fault-divorce), conflicts of interest |\n| LP protections | Excuse and exclusion rights, information rights, transfer restrictions, indemnification and exculpation limits |\n| Amendments | Consent thresholds, matters needing each affected LP's consent, GP authority to make administrative changes |\n| Tax and regulatory | Allocations for tax purposes, withholding, Employee Retirement Income Security Act (ERISA) and other investor-specific provisions |"]},{"heading":"Related documents","paragraphs":["The [private placement memorandum](/glossary/private-placement-memorandum) describes the offering and its risks but is not the governing contract. The [subscription agreement](/glossary/subscription-agreement) records each investor's commitment, eligibility representations and tax and anti-money-laundering information. [Side letters](/glossary/side-letter) vary terms for individual LPs. A management or advisory agreement between the fund and the manager, the GP's own operating agreement and the carry vehicle's documents sit behind the LPA, and parallel funds and alternative investment vehicles have their own LPAs on matching terms."]},{"heading":"Governing law and vehicle","paragraphs":["Common choices are a Delaware limited partnership, a Cayman Islands exempted limited partnership, a Luxembourg special limited partnership (SCSp), and English, Guernsey, Jersey or Irish limited partnerships. Each law sets its own baseline for partner liability, information rights and how far duties can be modified. For example, under Luxembourg law an SCSp is formed between one or more general partners with unlimited joint and several liability for its obligations and one or more limited partners who commit only a specified contribution, and it has no legal personality separate from its partners (Article 320-1 of the Law of 10 August 1915).","Delaware's limited partnership statute states a policy of giving maximum effect to freedom of contract and to the enforceability of partnership agreements; the agreement may expand, restrict or eliminate partners' duties but may not eliminate the implied contractual covenant of good faith and fair dealing (6 Del. C. section 17-1101(c)-(d))."]},{"heading":"Model terms and benchmarks","paragraphs":["The Institutional Limited Partners Association (ILPA) publishes a Model LPA for a traditional buyout fund in two Delaware-law versions: a whole-of-fund waterfall version (first released October 2019, updated July 2020) and a deal-by-deal version (July 2020). LPs also benchmark drafts against the ILPA Principles 3.0 (June 2019), which set out LP positions on economics, governance and transparency. Neither is binding; both are used as reference points in negotiation."]},{"heading":"Negotiation and amendment","paragraphs":["The GP's counsel drafts the LPA; anchor and large LPs negotiate it, often through a joint comment process, before the first closing. Later LPs usually accept the agreed text and negotiate side letters. After closing, amendments generally need the consent of a stated majority or supermajority in interest of LPs, and changes that adversely and disproportionately affect particular LPs or increase their obligations usually need those LPs' consent. The thresholds are negotiated and vary. For a Delaware limited partnership, an agreement that provides how it may be amended may be amended only in that manner or as otherwise permitted by law (6 Del. C. section 17-302(f))."]}],"classification_rules":[],"calculation_rules":[],"common_mistakes":["Relying on the PPM summary of terms instead of the LPA text, which prevails.","Reviewing the LPA without the side letters, and the terms other LPs elect under most favored nation clauses, that change how it applies.","Treating the ILPA Model LPA as market standard; it is a benchmark that many LPAs depart from."],"edge_cases":[],"external_standard_mappings":[{"standard":"ILPA Model LPA","reference":"Whole of Fund (Oct 2019, updated Jul 2020) and Deal-by-Deal (Jul 2020) versions","relation":"related","source_id":"SRC-ILPA-MODEL-LPA"},{"standard":"ILPA Principles 3.0","reference":"Alignment of interest, governance and transparency","relation":"related","source_id":"SRC-ILPA-PRINCIPLES-3"}],"source_ids":["SRC-ILPA-MODEL-LPA","SRC-ILPA-PRINCIPLES-3","SRC-LU-COMPANIES-LAW-1915-SCSP","SRC-US-DELCODE-6-17-1101","SRC-US-DELCODE-6-17-302"],"citations":[{"source_id":"SRC-ILPA-MODEL-LPA","pinpoint":"Release history; Delaware-law buyout fund models","supports":"Two model LPA versions and their dates","source":{"source_id":"SRC-ILPA-MODEL-LPA","title":"ILPA Model Limited Partnership Agreement (Whole of Fund and Deal-by-Deal versions)","authors":"Institutional Limited Partners Association","publisher":"ILPA","document_type":"template","url":"https://ilpa.org/industry-guidance/templates-standards-model-documents/model-limited-partnership-agreement/","year":2020,"publication_date":"Whole of Fund first released October 2019, updated July 2020; Deal-by-Deal version and term sheet released 22 July 2020","jurisdiction":"intl","status":"Current","last_verified":"2026-10-01"}},{"source_id":"SRC-ILPA-PRINCIPLES-3","pinpoint":"Third edition, released 2019-06-27","supports":"ILPA Principles 3.0 as an LP benchmark built on alignment of interest, governance and transparency","source":{"source_id":"SRC-ILPA-PRINCIPLES-3","title":"ILPA Principles 3.0: Fostering Transparency, Governance and Alignment of Interests for General and Limited Partners","authors":"Institutional Limited Partners Association","publisher":"ILPA","document_type":"guidance","url":"https://ilpa.org/wp-content/uploads/2019/06/ILPA-Principles-3.0_2019.pdf","year":2019,"publication_date":"Third edition, released 27 June 2019","jurisdiction":"intl","status":"Current edition (no 4.0 found as of 2026-10-01)","last_verified":"2026-10-01"}},{"source_id":"SRC-LU-COMPANIES-LAW-1915-SCSP","pinpoint":"Art. 320-1(1)-(2)","supports":"SCSp: general partners with unlimited joint and several liability; limited partners who commit only a specified contribution ('qui n'engagent qu'une mise déterminée'); no legal personality distinct from its partners","source":{"source_id":"SRC-LU-COMPANIES-LAW-1915-SCSP","title":"Loi modifiée du 10 août 1915 concernant les sociétés commerciales - Art. 320-1 (société en commandite spéciale, SCSp)","authors":"Grand Duchy of Luxembourg","publisher":"Legilux (consolidated version applicable 2 March 2025)","document_type":"law","url":"https://data.legilux.public.lu/filestore/eli/etat/leg/loi/1915/08/10/n1/consolide/20250302/fr/html/eli-etat-leg-loi-1915-08-10-n1-consolide-20250302-fr-html.html","year":2025,"publication_date":"SCSp introduced by Law of 12 July 2013; now Art. 320-1 (last amended by Law of 7 August 2023)","jurisdiction":"LU","status":"In force","last_verified":"2026-10-01"}},{"source_id":"SRC-US-DELCODE-6-17-1101","pinpoint":"Sec. 17-1101(c)-(d)","supports":"Delaware policy of maximum effect to freedom of contract; duties may be expanded, restricted or eliminated by the partnership agreement, but not the implied contractual covenant of good faith and fair dealing","source":{"source_id":"SRC-US-DELCODE-6-17-1101","title":"6 Del. C. s.17-1101 - Construction and application of chapter and partnership agreement (DRULPA)","publisher":"State of Delaware (Delaware Code Online)","document_type":"statute","url":"https://delcode.delaware.gov/title6/c017/sc11/index.html","publication_date":"Delaware Code Online, Title 6 ch. 17 (accessed 2026-10-01)","jurisdiction":"US-DE","status":"in force","last_verified":"2026-10-01"}},{"source_id":"SRC-US-DELCODE-6-17-302","pinpoint":"Sec. 17-302(f)","supports":"A Delaware partnership agreement that provides how it may be amended may be amended only in that manner or as otherwise permitted by law","source":{"source_id":"SRC-US-DELCODE-6-17-302","title":"6 Del. C. s.17-302 - Classes and voting (Delaware Revised Uniform Limited Partnership Act), incl. s.17-302(f) amendment of the partnership agreement","publisher":"State of Delaware (Delaware Code Online)","document_type":"statute","url":"https://delcode.delaware.gov/title6/c017/sc03/index.html","publication_date":"Delaware Code Online, Title 6 ch. 17 (accessed 2026-10-02)","jurisdiction":"US-DE","status":"in force","last_verified":"2026-10-02"}}],"faq":[{"q":"What is the difference between an LPA and a side letter?","a":"The LPA binds all partners on the same terms. A side letter is a separate agreement with one LP that adds to or varies those terms for that LP only."},{"q":"Can an LPA be changed after the fund closes?","a":"Yes, by amendment in the manner the LPA itself provides. LPAs typically require the consent of a stated majority or supermajority in interest of LPs, and the consent of any LP whose rights would be adversely and disproportionately affected; under Delaware law an agreement that sets out how it may be amended may be amended only in that manner or as otherwise permitted by law."}],"seo":{},"first_published":"2026-01-01","last_reviewed":"2026-10-02","last_modified":"2026-10-02","content_version":"2.0.0","url":"https://altss.com/glossary/limited-partnership-agreement","json_url":"https://altss.com/reference/concepts/limited-partnership-agreement.json","title":"Limited Partnership Agreement (LPA)","formulas":[],"sources":[{"source_id":"SRC-ILPA-MODEL-LPA","title":"ILPA Model Limited Partnership Agreement (Whole of Fund and Deal-by-Deal versions)","authors":"Institutional Limited Partners Association","publisher":"ILPA","document_type":"template","url":"https://ilpa.org/industry-guidance/templates-standards-model-documents/model-limited-partnership-agreement/","year":2020,"publication_date":"Whole of Fund first released October 2019, updated July 2020; Deal-by-Deal version and term sheet released 22 July 2020","jurisdiction":"intl","status":"Current","last_verified":"2026-10-01"},{"source_id":"SRC-ILPA-PRINCIPLES-3","title":"ILPA Principles 3.0: Fostering Transparency, Governance and Alignment of Interests for General and Limited Partners","authors":"Institutional Limited Partners Association","publisher":"ILPA","document_type":"guidance","url":"https://ilpa.org/wp-content/uploads/2019/06/ILPA-Principles-3.0_2019.pdf","year":2019,"publication_date":"Third edition, released 27 June 2019","jurisdiction":"intl","status":"Current edition (no 4.0 found as of 2026-10-01)","last_verified":"2026-10-01"},{"source_id":"SRC-LU-COMPANIES-LAW-1915-SCSP","title":"Loi modifiée du 10 août 1915 concernant les sociétés commerciales - Art. 320-1 (société en commandite spéciale, SCSp)","authors":"Grand Duchy of Luxembourg","publisher":"Legilux (consolidated version applicable 2 March 2025)","document_type":"law","url":"https://data.legilux.public.lu/filestore/eli/etat/leg/loi/1915/08/10/n1/consolide/20250302/fr/html/eli-etat-leg-loi-1915-08-10-n1-consolide-20250302-fr-html.html","year":2025,"publication_date":"SCSp introduced by Law of 12 July 2013; now Art. 320-1 (last amended by Law of 7 August 2023)","jurisdiction":"LU","status":"In force","last_verified":"2026-10-01"},{"source_id":"SRC-US-DELCODE-6-17-1101","title":"6 Del. C. s.17-1101 - Construction and application of chapter and partnership agreement (DRULPA)","publisher":"State of Delaware (Delaware Code Online)","document_type":"statute","url":"https://delcode.delaware.gov/title6/c017/sc11/index.html","publication_date":"Delaware Code Online, Title 6 ch. 17 (accessed 2026-10-01)","jurisdiction":"US-DE","status":"in force","last_verified":"2026-10-01"},{"source_id":"SRC-US-DELCODE-6-17-302","title":"6 Del. C. s.17-302 - Classes and voting (Delaware Revised Uniform Limited Partnership Act), incl. s.17-302(f) amendment of the partnership agreement","publisher":"State of Delaware (Delaware Code Online)","document_type":"statute","url":"https://delcode.delaware.gov/title6/c017/sc03/index.html","publication_date":"Delaware Code Online, Title 6 ch. 17 (accessed 2026-10-02)","jurisdiction":"US-DE","status":"in force","last_verified":"2026-10-02"}]}