NAV Covenants And Subscription Lines

For funds that are nearing the end of their investment period and have limited or no remaining unfunded capital commitments, the need to continue a subscription line facility for ongoing liquidity may continue to exist for these end-of-life funds to support follow-on investments, reoccurring fund operational expenses, and costs associated with maintaining and liquidating their portfolio investments. There are a number of financing options in the fund finance market for these funds to consider, including net asset value (NAV) and hybrid credit facilities, but, for many funds, the convenience and familiarity of their existing subscription line credit facility may continue to remain the most efficient and expeditious way to extend their liquidity runway. In order to prolong an existing subscription line facility to a fund after its investment period, there are a number of important threshold factors that a lender must consider, including the purpose for which the general