The governing agreements for the GP and management companies that sit above a PE fund determine how a sponsor allocates its economics, makes decisions and protects itself when employees depart. It is easy for founders to defer detailed consideration of the governance and operation of those upper-tier arrangements when a PE firm is first launched. Those early oversights can produce exceptional costs and complications years later, however, when a founder departs, two principals deadlock over the direction of the business or the next generation of leadership clamor for a greater role in managing its future. These issues related to upper-tier PE arrangements were the subject of a Practising Law Institute panel featuring Paul Hastings partner Amanda Persaud; Weil partner David J. Greene; Sidley Austin partner Jennifer A. Spiegel; and Kyndra Adair, in-house counsel at General Atlantic. This article details the basic economic tenets of a PE firm’s upper-tier structure, employee retention considerations that impact carry waterfall decisions, forfeiture provisions for unvested carry interests, economic distinctions of evergreen funds, governance models for management companies and the critical role of restrictive covenants in protecting a PE firm. See “Upper-Tier Structures and Key Considerations” (Sep. 7, 2023).