What is a status quo option?

ILPA’s 2023 continuation fund guidance said LPs must be offered one: no higher fee rate, the same fee base, no higher carry or lower hurdle, and no carry crystallisation. Its October 2026 update instead says rolling LPs should face no overall increase in fee or carry cost, which a GP may achieve on new-investor terms, on a status quo basis that closely replicates existing fund economics, or a mix, with an election period of generally at least 20 clear business days.

Say an LP pays a 1.5% fee and 20% carry over an 8% hurdle in the old fund, while the continuation vehicle offers 20% carry with no hurdle. Under a status quo option, the LP can roll and keep its 1.5%, 20% and 8%. Simple example. Terms vary by fund.

Without it, LPs that want to keep their exposure can be pushed onto new terms, so it has been one of the main protections LPs ask for.