Management Services Agreement | Practical Law

Management Services Agreement | Practical Law

A management services agreement to be used in connection with a private equity buyout. This agreement sets out the terms and conditions by which a portfolio company agrees to pay advisory and management services fees and out-of-pocket expenses to an equity sponsor in connection with a buyout. It is drafted in favor of the equity sponsor, but aims to be reasonable and contains provisions commonly included in these types of agreements. This Standard Document has integrated notes with important explanations and drafting and negotiating tips.

Management Services Agreement

Practical Law Standard Document 1-387-5031 (Approx. 18 pages)

Management Services Agreement

by Practical Law Corporate & Securities
Maintained • USA (National/Federal)
A management services agreement to be used in connection with a private equity buyout. This agreement sets out the terms and conditions by which a portfolio company agrees to pay advisory and management services fees and out-of-pocket expenses to an equity sponsor in connection with a buyout. It is drafted in favor of the equity sponsor, but aims to be reasonable and contains provisions commonly included in these types of agreements. This Standard Document has integrated notes with important explanations and drafting and negotiating tips.
On August 23, 2023, the SEC adopted new rules under the Investment Advisers Act of 1940 for private fund advisers (see Legal Update, SEC Adopts New Rules for Private Fund Advisers) (the "New Rules"). The New Rules are generally effective 12 to 18 months after publication in the Federal Register and will have a material impact on limited partnership agreements for private equity funds and may require revisions to this resource. Updates are planned in the near future. For more information on the final rule, see Private Fund Advisers; Documentation of Registered Investment Adviser Compliance Reviews, Fed. Reg. 88 FR 63206 (Sept. 14, 2023).