Contract analysis

I. Executive Summary Ardent Capital GP III LLC (the "General Partner"), the sole general partner of Ardent Capital Partners III LP (the "Fund"), is proposing a comprehensive restructuring of its management company and a corresponding realignment of economics among the Fund's principals. This memorandum has been prepared by Calderwood & Harkness LLP, as special restructuring counsel to the General Partner, to provide

II. Rationale for Restructuring The proposed restructuring is driven by three interrelated objectives: succession planning in connection with the departure of two senior principals, enhancement of the governance framework to simplify and centralize decision-making, and integration of the next generation of Ardent investment professionals into the platform's economic and governance structure. A. Succession Planning Tw

III. New Entity Structure A. Current Structure (Pre-Restructuring) Under the Fund's existing organizational framework, five individual principals hold direct membership interests in both the General Partner and the ManCo: Ardent Capital GP III LLC (the "General Partner") is a Delaware limited liability company and the sole general partner of the Fund. Its members are the five individual principals, each holding membe

IV. Economics Realignment The restructuring necessitates a comprehensive realignment of the Fund's economic arrangements, including carried interest allocations, management company profit share distributions, and GP commitment obligations. This section describes the pre-restructuring and post-restructuring economics in detail. A. Pre-Restructuring Carry Allocation Under the current carried interest allocation framewo

V. Departing Principal Terms A. David Kellner — Retirement The separation terms for David Kellner have been negotiated between Mr. Kellner and the General Partner, with the assistance of their respective counsel. A summary of the material terms is set forth below: Effective Retirement Date: March 31, 2024. Senior Advisor Transition: Upon retirement, Mr. Kellner will transition to a Senior Advisor role under a separat

VI. Impact on Fund Operations The General Partner wishes to emphasize that the restructuring is an internal organizational matter that does not affect the Fund's operations, investment activities, or economic terms from the perspective of the limited partners. The following subsections address each area of potential concern. A. Investment Strategy There is no change to the Fund's investment strategy. The Fund will co

VII. Key-Person Analysis A. LPA Key-Person Provisions (Section 5.2)

Section 5.2 of the LPA designates Marcus Aldridge and Priya Narayanan as the "Key Persons" of the Fund. Under Section 5.2, a "Key Person Event" is triggered if: (a) both Key Persons cease to devote substantially all of their business time and attention to the affairs of the Fund; or (b) one Key Person ceases to devote substantially all of his or her business time and attention to the affairs of the Fund and is not re

VIII. Side-Letter Compliance Summary A. Overview The Fund has fourteen (14) side letters currently in effect, covering a subset of the Fund's forty-seven (47) limited partners. Calderwood & Harkness LLP, in coordination with Pemberton Hale LLP (as the Fund's formation counsel), has conducted a comprehensive review of all fourteen side letters to identify any provisions that are implicated by the proposed restructurin

1. Most Favored Nation ("MFN") Provisions (11 side letters): Eleven of the fourteen side letters contain MFN provisions entitling the applicable limited partner to receive the benefit of any more favorable terms granted to any other limited partner (subject to customary carve-outs for terms related to tax, regulatory, or legal requirements specific to a particular investor). Calderwood & Harkness has reviewed the res

2. Expanded Key-Person Provisions (6 side letters, naming Kellner as Contributing Person): As discussed in detail in Section VII.B above, six side letters contain expanded key person provisions designating David Kellner as a Contributing Person. Written notification to the affected limited partners is required within fifteen (15) business days of Mr. Kellner's departure, and three of the six side letters grant a nine

3. Fee discount or Rebate Provisions (8 side letters): Eight side letters contain provisions granting the applicable limited partner a discount on management fees or a rebate of a portion of management fees (in each case, subject to the terms and conditions set forth in the applicable side letter). The restructuring does not affect the management fee rate, the total management fee amount, or the calculation methodolo

4. Transfer/Restructuring Consent Requirements (4 side letters): Four side letters — those entered into with the following limited partners — contain provisions requiring prior written notice and, in certain cases, affirmative consent for any "material change in the management structure" of the Fund: (a) Ridgeline Public Employees' Retirement System (b) Pinnacle Insurance Group (c) Crestwood Endowment Partners (d) Ha

5. Co-Investment Priority Rights (9 side letters): Nine side letters contain provisions granting the applicable limited partner priority rights or preferential access to co-investment opportunities alongside the Fund. The restructuring necessitates an update to the Fund's Co-Investment Allocation Policy to reflect the removal of David Kellner and Joanna Trask from co-investment eligibility (as they will no longer be

IX. LPAC Consent Requested A. Basis for Consent Solicitation

Section 9.4 of the LPA requires the prior consent of the LPAC for certain material actions by the General Partner, including, without limitation, any material change in the management structure of the Fund. The restructuring described in this memorandum — including the formation of HoldCo and GP Intermediate, the amendment of the LLC agreements of the General Partner and the ManCo, the reallocation of carried interes

1. The formation of Ardent Capital Holdings LLC ("HoldCo") and Ardent GP Intermediate LLC ("GP Intermediate") as part of the restructured entity framework described in Section III.B above.

2. The amendment and restatement of the LLC agreement of Ardent Capital GP III LLC (Second Amended and Restated LLC Agreement of Ardent Capital GP III LLC) to reflect Ardent GP Intermediate LLC as the sole member of the General Partner.

3. The amendment and restatement of the LLC agreement of Ardent Capital Management LLC (Second Amended and Restated LLC Agreement of Ardent Capital Management LLC) to reflect HoldCo as the sole member of the ManCo.

4. The execution of Amendment No. 1 to the Amended and Restated Agreement of Limited Partnership of Ardent Capital Partners III LP, in substantially the form attached hereto as Appendix G, to reflect the structural changes to the General Partner's ownership.

5. The reallocation of carried interest and ManCo profit share among the remaining and next-generation principals, as described in Section IV above, including the execution of the Amended and Restated Carried Interest Allocation Agreement.

6. The approval of the separation terms for David Kellner (retirement) and Joanna Trask (voluntary departure), as described in Section V above, including the carry retention and forfeiture provisions, restrictive covenants, and related terms.

7. The authorization of the General Partner to execute all related ancillary documents, instruments, certificates, and agreements as may be necessary or desirable to effectuate the restructuring, including without limitation the HoldCo LLC Agreement, the GP Intermediate LLC Agreement, the Senior Advisor Agreement (Kellner), the Separation Agreement (Trask), the Carry Participation Agreements (Kellner and Trask), and

X. Timeline and Next Steps The following table sets forth the anticipated timeline for the implementation