Although no private fund sponsor generally expects to see their GP clawback provision – the provision requiring them to reimburse LPs for excess carried interest distributions – triggered, the prospect of a triggering event can put fund managers in a difficult position. Not only can reputational harm occur with investors, but firms can face a liquidity crisis as they scramble to find the cash necessary to reimburse sums – sometimes large sums – to investors. In turn, GPs are heavily incentivized to put a suite of protections in place that can both prevent the likelihood of a clawback from being triggered and, if unavoidable, smoothen their ability to promptly – and ideally painlessly – repay investors. This second article in a two-part series identifies contractual mechanisms that GPs pursue to limit the scope and likelihood of clawbacks, as well as ways they improve their ability to hold current and former employees accountable for their respective shares of clawback obligations. The first article contextualized the increased focus on clawback provisions in GP‑LP negotiations and described additional protections LPs pursue to ensure they receive their share of fund profits. See “Current Trends and Pressure Points in Negotiations Around Distribution Waterfalls” (Jan. 23, 2025); and “How Carried Interest Clawbacks Preserve Investor Returns and Affect Taxation (Part Two of Two)” (Jun. 11, 2019).