Fund Managers Should Amend Subscription Documents The Dodd-Frank Wall Street Reform and Consumer Protection Act (“Act”) immediately changed the definition of accredited investor. Prior to the enactment of the Act, an accredited investor could use the value of their primary residence to compute the $1,000,000 net worth requirement. Now, investors [...]

Form D Updating Requirements Initial Filing Requirement As discussed in our overview of Regulation D, hedge funds must file a Form D with the SEC within 15 days of the first subscription of hedge fund interests.  This filing is now done completely online through the SEC’s EDGAR filing system.  If [...]

There are occasionally times when questions arise as to the meaning of certain undefined terms within statutes or regulations.  Practitioners have a variety of different resources which can help shed light onto these undefined terms or at least provide background information or context.  Below is the SEC’s Interpretive Release on [...]

How to write a hedge fund disclaimer One of the more unusual requests (in my opinion) that we receive on this site is how to write a hedge fund disclaimer.  I think that this is unusual because I would assume that most hedge fund managers would want to make sure [...]

In our continuing effort to expand our hedge fund law resources on this blog, we will be posting statutes and other legal resources from each of the states.  Because each state has different laws and enforces those laws differently, hedge fund lawyers often discuss state specific hedge fund issues with [...]

he following is a summary of the major laws which affect the hedge fund industry.  If you have any questions on how these laws impact hedge funds in general or your specific situation, please contact us. **** Securities Act of 1933 – the 1933 Act was enacted on May 27, [...]

The Securities Act of 1933 (the “Securities Act”) is the cornerstone to the regulation of securities in the United States. The most important feature of the act is the requirement that all securities be registered or fall within an exemption from registration.  This overview will detail the important provisions of [...]

Often word of mouth is the best way to get an idea spread through groups of people – especially when most forms of marketing are not allowed.  One way to make a name for your hedge fund is through your existing investors who provide a source for potential investor referrals.  [...]

Interests in hedge funds are securities which mean that hedge fund managers must follow the federal (and state) laws regarding the sale of securities to investors.  Typically, securities will need to be registered under the Securities Act of 1933 unless there is an exemption from the registration provisions. There are [...]

Hedge fund managers can only admit certain investors into their hedge funds.  Most hedge funds are structured as private placements relying on the Regulation D 506 offering rules.  Under the Reg D rules, investors must generally be “accredited investors.”  Many hedge funds have additional requirements. With regard to individual investors, [...]