Private equity firms routinely appoint directors to boards of their privately held portfolio companies and other investment vehicles, some of which will eventually face financial distress. Often, a person appointed to a board by a private equity firm has a relationship with the firm (e.g., they work there or are a trusted friend) but limited experience when it comes to what to do under troubled circumstances. Such individuals may worry about their personal liability in such a situation. What should such an individual do?

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