Lowenstein Sandler LLP

Significant Accomplishments

Speaking Engagements

Ed Nadel will be speaking on the panel "Hot Topics for Hedge Fund Managers" at the Practising Law Institute's "Hedge Fund Management 2016" program. During this full-day program (9 a.m. to 5 p.m.), presenters will cover topics related to enforcement priorities and compliance weaknesses; hedge fund registration and regulation issues; domestic and off-shore hedge fund structures; hot button issues such as cybersecurity, activist investing and reporting, and personal liability for CCOs; and data traps for hedge fund managers.

Edward S. Nadel addresses Compliance and Enforcement: Focus on Private Equity Funds as part of PLI's Twentieth Annual Private Equity Forum. His presentation will address:

• Hot topics
• Practice tips
• Enforcement priorities and trends
• Regulation of private equity funds
• Establishing private fund compliance

Twentieth Annual Private Equity Forum program description:

The Twentieth Annual Private Equity Forum has curated a distinguished panel of experts who will spend one and a half days examining the legal issues and prevailing industry trends faced by corporate and securities attorneys, accountants and other professionals involved in the fund-raising and financing businesses. Whether it is the impact of new tax laws on private equity funds, practical practice tips for a global market, or conflicts of interest trends inherent in the investment advisory business, this year's forum will tackle more than just the basics and hot topics of the private equity fund practice.

This program will address the key issues in marketing private equity funds on a global basis, the architecture of sponsor-led restructuring deals, current issues in negotiating the terms of private equity funds, and establishing effective private fund compliance. There will be a private equity tax update with an in depth review of the taxation of carried interest and the impact of new tax laws on private equity funds. Also featured is an ethics segment focused on the issues arising between advisers and their funds, and in managing multiple funds. 

The program will cover:

• How to organize a global fund raising effort, with emphasis on U.S. and European fundraising 
• Best practices for recurring issues in private equity transactions 
• Negotiated fiduciary duty provisions 
• Expense allocation for service providers 
• Succession planning and how to plan for generational change 
• Enforcement priorities and trends of private equity funds 
• Conflicts of interest inherent in the investment advisory business

Additional information:

• Nadel's presentation takes place on Tuesday, July 16, 2019, at 10 a.m.
• The forum runs Monday, July 15, 9 a.m.-5 p.m., and Tuesday, July 16, 2019, 9 a.m.-12:30 p.m.
• The program will be held in person at the PLI New York Center, 1177 Avenue of the Americas, Second Floor, New York, NY; 800.260.4754. It will also be webcast and groupcast at various locations.

Overview

Question 1: What is a hedge fund?

A hedge fund is a privately offered vehicle formed to facilitate investments by one or more investors in specific investment programs. Hedge funds may differ from other privately offered investment funds, such as private equity funds and venture capital funds, on a number of factors, including:

• Investment strategies that they pursue
• Subscription-based rather than commitment-based structure
• Perpetual offering period and perpetual duration
• Ability of investors to redeem

As discussed below, hedge funds are privately offered under the Securities Act of 1933, as amended (the Securities Act) and are not registered under the Investment Company Act of 1940, as amended (the Investment Company Act).

Hedge funds pursue a broad range of investment strategies, including many that overlap with those pursued by other privately offered and registered investment vehicles. Long/short equity funds are very common, with many such hedge funds focusing on generating returns through higher position concentrations, as well as effective and aggressive use of short sales and/or other techniques that mutual funds are generally restricted from utilizing. Hedge funds are active in strategies that utilize detailed research and broad knowledge bases such as global macro strategies that require substantial knowledge of world events and an in-depth understanding of the differing and unique investment products and opportunities available on a global basis. Many hedge funds pursue eventdriven strategies that seek to exploit advanced knowledge and expert analysis of the impact that pricing inefficiencies connected to material corporate transactions will have on the securities related to the involved companies. Quantitative hedge funds use enhanced research combined with expertise on systems and programming to design models to guide trading that can take advantage of even small inefficiencies in market values. Hedge funds are active in the credit markets, particularly as increased regulation has reduced the ability of banks to make corporate loans at the pace demanded by the market. Hedge funds have similarly expanded into markets such as real estate that have been traditionally connected to commitment-based funds to exploit similar gaps. Other hedge funds pursue more specialized knowledge and situations, particularly in commodities or specialized financial products.

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