Our Cayman Investor Services team acts for institutional investors, high net worth and sophisticated investors, family offices, funds of funds, asset managers and advisers, investment banks, pension funds, asset allocators and venture capitalists. Our experienced professionals offer local market knowledge and insights to enhance our clients’ due diligence processes, ensuring that agreed variations to investment terms are implemented in a way that will be enforceable under Cayman law.
Investor due diligence is an essential part of the investment process for our clients. We review the key offer documentation and constitutional documentation to ensure compliance with Cayman law and regulation, internal consistency, compliance with investor requirements and compatibility with current market practice and terms.
We offer an enhanced due diligence review that includes a detailed formal Cayman law opinion on key issues – the due establishment of the Cayman fund vehicle, its capacity power and authority to enter into the investment contracts, and the enforceability of those contracts. We are also able to arrange the production of local certificates of good standing and to conduct local court searches on Cayman entities within an investment structure.
Our investor services team advises prospective investors on the terms of their investment agreements. We work with investors whose potential investments are so significant to a fund that they can negotiate amendments to the fund’s offering terms as a pre-condition to their investment.
Preferential terms commonly include lower or rebated fees, greater access to reporting, more favourable liquidity or transferability provisions, and most favoured nation clauses. We review side letter terms to ensure that the final agreement is valid and enforceable and will not leave the fund open to claims from its other investors.
We examine key issues – including the time at which a side letter is entered into, the correct identification of the parties, the authorisations required under the fund’s constitutional documents, the disclosures within a fund’s offering documents relating to side letter terms, and the fund’s class rights provisions. These issues must be properly addressed for the Cayman courts to uphold side letter terms. Our review focuses on ensuring that side letter terms are correctly authorised and recorded in an enforceable formal agreement between the relevant parties.