CONFIDENTIAL FEE LETTER
February 10, 2025
Ridgeline National Bank, N.A. 225 Liberty Street New York, NY 10281
Ardent Healthcare Holdings Inc. c/o Ardent Capital Management III LLC 599 Lexington Avenue, 34th Floor New York, NY 10022
Attention: Graham Whitfield, Managing Partner & Co-Founder
Cc: Priya Ranganathan, Partner, Healthcare Investing
Re: Fee Letter — Senior Secured Credit Facilities Reference No. RNB-HC-2025-0418
Ladies and Gentlemen:
This Confidential Fee Letter (this "Fee Letter") is delivered in connection with, and supplements, that certain Commitment Letter dated as of February 10, 2025 (as amended, restated, supplemented, or otherwise modified from time to time, the "Commitment Letter") among Ridgeline National Bank, N.A. ("Ridgeline," the "Agent," or the "Lead Arranger") and Ardent Healthcare Holdings Inc. (the "Borrower") relating to the Senior Secured Credit Facilities (the "Facilities") to be entered into in connection with the Borrower's acquisition (the "Acquisition") of all of the outstanding equity interests of MedVance Health Systems, Inc. (the "Target"). Capitalized terms used and not otherwise defined herein shall have the meanings assigned to such terms in the Commitment Letter or in the Summary of Terms and Conditions attached thereto as Exhibit A (the "Term Sheet").
As more fully described in the Commitment Letter and the Term Sheet, the Facilities consist of (a) a senior secured first-lien term loan B facility in an aggregate principal amount of Three Hundred Forty Million Dollars ($340,000,000) (the "Term Loan B Facility") and (b) a senior secured first-lien revolving credit facility in an aggregate principal amount of Fifty Million Dollars ($50,000,000) (the "Revolving Credit Facility" and, together with the Term Loan B Facility, the "Credit Facilities"). The Credit Facilities are to be documented pursuant to a definitive credit agreement (the "Credit Agreement") among the Borrower, the guarantors party thereto, the lenders from time to time party thereto, and Ridgeline, as Administrative Agent and Collateral Agent.
The Borrower acknowledges that Pinnacle Commercial Credit Corp. ("Pinnacle") is participating in the Credit Facilities as a Co-Lender. Notwithstanding the foregoing, the fees set forth in this Fee Letter are payable solely to Ridgeline in the capacities described below, and Pinnacle shall have no right, title, or interest in or to any portion of the fees described herein.
In consideration of the commitments and agreements set forth in the Commitment Letter and the mutual covenants contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:
Section 1 — Arrangement Fee
1.1 The Borrower shall pay to Ridgeline, in its capacity as Sole Lead Arranger and Sole Bookrunner for the Credit Facilities, a non-refundable arrangement fee (the "Arrangement Fee") in the amounts set forth below:
(a) Term Loan B Arrangement Fee. An arrangement fee equal to 1.75% of the aggregate principal amount of commitments under the Term Loan B Facility on the Closing Date. Based on an aggregate committed principal amount of $340,000,000, the Term Loan B Arrangement Fee shall be Five Million Nine Hundred Fifty Thousand Dollars ($5,950,000) (being 1.75% × $340,000,000).
(b) Revolving Credit Facility Arrangement Fee. An arrangement fee equal to 1.00% of the aggregate commitments under the Revolving Credit Facility on the Closing Date. Based on aggregate Revolving Credit Facility commitments of $50,000,000, the Revolving Credit Facility Arrangement Fee shall be Five Hundred Thousand Dollars ($500,000) (being 1.00% × $50,000,000).
(c) Aggregate Arrangement Fee. The aggregate Arrangement Fee payable pursuant to clauses (a) and (b) above shall equal Six Million Four Hundred Fifty Thousand Dollars ($6,450,000).
1.2 The Arrangement Fee shall be deemed earned in full upon execution of the Commitment Letter by each of the parties thereto and shall be payable in immediately available funds on the Closing Date (which is expected to be April 18, 2025, or such other date as may be agreed by the parties in accordance with the Commitment Letter) by wire transfer to the account designated by Ridgeline in the wire instructions set forth on Schedule A to the Commitment Letter. Payment of the Arrangement Fee shall occur simultaneously with the initial funding of the Term Loan B Facility.
1.3 Notwithstanding Section 1.2, if the Closing Date does not occur and the Commitment Letter is terminated in accordance with its terms prior to the Closing Date, no Arrangement Fee shall be payable hereunder, and neither party shall have any further obligation to the other with respect to the Arrangement Fee.
1.4 Once paid, the Arrangement Fee is non-refundable and non-creditable against any other fees, interest, or other amounts payable under the Credit Agreement or any other Loan Document. The Arrangement Fee shall not be subject to set-off, deduction, or counterclaim of any nature whatsoever.
Section 2 — Administrative Agent Fee
2.1 The Borrower shall pay to Ridgeline, in its capacity as Administrative Agent under the Credit Agreement, a non-refundable annual administrative agent fee (the "Agent Fee") in the amount of Two Hundred Thousand Dollars ($200,000) per annum.
2.2 The Agent Fee shall be payable in advance as follows:
(a) The first installment of the Agent Fee, in the amount of $200,000, shall be due and payable on the Closing Date, simultaneously with the funding of the Term Loan B Facility and the payment of the Arrangement Fee.
(b) Thereafter, the Agent Fee shall be due and payable in the amount of $200,000 on each anniversary of the Closing Date for so long as the Credit Agreement remains in effect and any commitments or obligations thereunder remain outstanding.
2.3 Each installment of the Agent Fee shall be deemed earned in full upon the applicable payment date. The Agent Fee shall not be subject to pro-ration or refund in the event of early termination of the Credit Agreement, prepayment of the Credit Facilities, or any reduction in commitments thereunder. Once paid, each installment of the Agent Fee is non-refundable and non-creditable.
2.4 The Agent Fee is in addition to, and shall not be credited against or reduce, any reimbursement of costs and expenses (including, without limitation, fees and disbursements of counsel) payable to the Agent under the Credit Agreement, the Commitment Letter, or any other Loan Document.
Section 3 — Commitment Fee (Revolving Credit Facility)
3.1 As set forth in the Term Sheet attached to the Commitment Letter, a commitment fee (the "Unused Commitment Fee") shall accrue on the average daily unused portion of the commitments under the Revolving Credit Facility at a rate of 0.50% per annum. For purposes of this Section 3, the "unused portion" of the Revolving Credit Facility shall be calculated as the excess, if any, of (x) the aggregate commitments under the Revolving Credit Facility at such time over (y) the sum of (i) the aggregate principal amount of revolving loans outstanding at such time, (ii) the aggregate principal amount of swing-line loans outstanding at such time, and (iii) the aggregate undrawn face amount and unreimbursed drawn amount of all outstanding letters of credit at such time.
3.2 The Unused Commitment Fee shall be payable quarterly in arrears on the last Business Day of each fiscal quarter of the Borrower, commencing with the first full fiscal quarter ending after the Closing Date, and on the Revolving Credit Facility Maturity Date (as defined in the Term Sheet). In the event that the Revolving Credit Facility is terminated or all commitments thereunder are permanently reduced to zero on a date other than the last Business Day of a fiscal quarter, the Unused Commitment Fee accrued to such date shall be payable on such date.
3.3 For the avoidance of doubt, swing-line loans and letters of credit outstanding under the Revolving Credit Facility shall be deemed to reduce the unused commitments for purposes of computing the Unused Commitment Fee, as provided in Section 3.1 above.
3.4 The definitive terms governing the Unused Commitment Fee, including the calculation methodology, the applicable accrual periods, and the treatment of commitment reductions, shall be set forth in the Credit Agreement. In the event of any conflict or inconsistency between the provisions of this Fee Letter and the provisions of the Credit Agreement with respect to the Unused Commitment Fee, the terms and provisions of the Credit Agreement shall control and govern.
Section 4 — Syndication
4.1 The Borrower acknowledges and agrees that, as set forth in the Commitment Letter, Ridgeline shall have the right, in its capacity as Sole Lead Arranger and Sole Bookrunner, to syndicate all or any portion of the commitments and loans under the Credit Facilities to one or more institutional lenders, financial institutions, or other persons (each, a "Syndication Participant") selected by Ridgeline in consultation with the Borrower (such consultation right not to constitute a right of approval except as expressly provided in the Commitment Letter). The Borrower agrees that all fees set forth in this Fee Letter are for Ridgeline's sole account, and Ridgeline shall have no obligation to share, disclose, or pay over any portion of such fees to any Syndication Participant, co-lender (including, without limitation, Pinnacle Commercial Credit Corp.), or any other person.
4.2 Notwithstanding any syndication of the Credit Facilities, in whole or in part, the Arrangement Fee and the Agent Fee shall remain the sole and absolute obligation of the Borrower and shall not be reduced, adjusted, rebated, or otherwise modified by reason of such syndication. The Borrower's obligations with respect to the fees set forth herein are independent of and shall not be affected by the identity, number, or commitment amounts of any Syndication Participants.
Section 5 — Taxes; Gross-Up
5.1 All fees payable by the Borrower under this Fee Letter shall be paid free and clear of, and without deduction or withholding for or on account of, any present or future taxes, levies, imposts, duties, charges, assessments, or fees of any nature whatsoever (including interest, penalties, and additions to tax) imposed by any governmental authority (collectively, "Taxes"). If any deduction or withholding for any Taxes is required by applicable law (as determined in the good faith discretion of the applicable withholding agent), the Borrower shall pay such additional amounts ("Additional Amounts") as are necessary so that the net amount received by Ridgeline after such deduction or withholding (including any deduction or withholding on account of Additional Amounts) equals the full amount that would have been received by Ridgeline had no such deduction or withholding been made.
5.2 Notwithstanding Section 5.1, the Borrower shall not be required to pay Additional Amounts in respect of (a) net income taxes (however denominated) or franchise taxes imposed on Ridgeline by the jurisdiction under the laws of which Ridgeline is organized or in which its principal office or applicable lending office is located, or by any jurisdiction as a result of a present or former connection between Ridgeline and such jurisdiction (other than a connection arising solely from Ridgeline having executed, delivered, become a party to, performed its obligations under, received payments under, received or perfected a security interest under, or engaged in any other transaction pursuant to or enforced, this Fee Letter, the Commitment Letter, or any Loan Document), and (b) any branch profits taxes imposed by the United States or any similar tax imposed by any other jurisdiction in which Ridgeline is located.
5.3 The Borrower shall furnish to Ridgeline certified copies of official receipts or other evidence reasonably satisfactory to Ridgeline evidencing payment of any withholding Taxes with respect to payments made under this Fee Letter within thirty (30) days following each such payment. If no such receipts or evidence are available, the Borrower shall furnish such other documentation as Ridgeline may reasonably request.
Section 6 — Confidentiality
6.1 This Fee Letter and the terms and conditions set forth herein, including, without limitation, all fee amounts, percentages, and payment mechanics described herein (collectively, the "Fee Information"), are strictly confidential. Except as required by applicable law, regulation, or judicial or administrative order, process, or proceeding (including any subpoena or similar process), neither the Borrower nor any of its affiliates shall disclose or permit the disclosure of any Fee Information to any person other than the following (each, a "Permitted Recipient"):
(a) officers, directors, employees, accountants, and legal advisors of the Borrower, Ardent Capital Management III LLC, or Ardent Capital Partners III LP, in each case who have a need to know such Fee Information in connection with the Acquisition or the Credit Facilities and who have been informed of the confidential nature of such Fee Information and have agreed (or are otherwise subject to professional obligations) to maintain the confidentiality thereof;
(b) Calderwood & Harkness LLP, counsel to the Borrower in connection with the Acquisition and the Credit Facilities;
(c) Blackwell Thornton LLP and Osgood & Vail CPAs LLP, accounting and tax advisors to the Borrower, in each case solely on a need-to-know basis in connection with the Acquisition and the Credit Facilities and subject to customary professional obligations of confidentiality; and
(d) such other persons as Ridgeline may approve in writing in advance (such approval not to be unreasonably withheld or delayed).
6.2 Without limiting the generality of Section 6.1, the Borrower expressly agrees that no Fee Information shall be disclosed, directly or indirectly, to any of the following:
(a) the Target, MedVance Health Systems, Inc., or any of its subsidiaries, directors, officers, employees, or representatives;
(b) the Sellers, Crestline Growth Equity Fund II LP and Ryland Family Holdings LLC, or any of their respective general partners, limited partners, managers, members, directors, officers, employees, or representatives;
(c) Whitaker, Poole & Simms LLP, counsel to the Sellers; or
(d) Pemberton Marsh Securities LLC, investment bank to the Sellers.
6.3 Notwithstanding the foregoing restrictions, the Borrower may disclose this Fee Letter and any Fee Information in connection with any action or proceeding to enforce the provisions of this Fee Letter or the Commitment Letter.
6.4 If the Borrower or any of its affiliates is required or compelled by any applicable law, regulation, judicial or administrative order, process, or proceeding to disclose any Fee Information, the Borrower shall, to the extent legally permissible, provide Ridgeline with prompt written notice of such requirement or compulsion (and, in any event, prior to making such disclosure, if practicable) so that Ridgeline may seek a protective order, confidential treatment, or other appropriate remedy or waive compliance with the provisions of this Section 6. In the event that such protective order, confidential treatment, or other remedy is not obtained and Ridgeline does not waive compliance with this Section 6, the Borrower shall disclose only that portion of the Fee Information that the Borrower is legally required to disclose, and shall use commercially reasonable efforts to ensure that all Fee Information so disclosed is accorded confidential treatment. The Borrower agrees to cooperate with Ridgeline, at Ridgeline's expense, in seeking any such protective order or confidential treatment.
Section 7 — Amendment; Waiver
7.1 This Fee Letter may not be amended, supplemented, restated, or otherwise modified except by a written instrument duly executed and delivered by each of Ridgeline and the Borrower. No oral agreement, course of dealing, or trade usage shall operate to amend or modify the terms of this Fee Letter.
7.2 No waiver of any provision of this Fee Letter, and no consent to any departure by any party from the terms hereof, shall be effective unless such waiver or consent is set forth in a written instrument signed by the party granting such waiver or consent. No single or partial exercise of any right, power, or remedy hereunder shall preclude any other or further exercise thereof or the exercise of any other right, power, or remedy. No failure or delay on the part of any party hereto in exercising any right, power, or remedy under this Fee Letter shall operate as a waiver thereof, nor shall any course of dealing between the parties operate as a waiver of any rights hereunder.
Section 8 — Governing Law; Jurisdiction; Waiver of Jury Trial
8.1 Governing Law. This Fee Letter and the rights and obligations of the parties hereunder shall be governed by, and construed and interpreted in accordance with, the laws of the State of New York, without regard to principles of conflicts of law that would require the application of the laws of any other jurisdiction, other than Sections 5-1401 and 5-1402 of the New York General Obligations Law.
8.2 Jurisdiction. Each party hereto irrevocably and unconditionally submits to the exclusive jurisdiction of the United States District Court for the Southern District of New York, and any appellate court thereof (or, if such court lacks subject-matter jurisdiction, the Supreme Court of the State of New York, County of New York, and any appellate court thereof), in any action or proceeding arising out of or relating to this Fee Letter, the Commitment Letter, or any of the transactions contemplated hereby or thereby, and each party hereby irrevocably and unconditionally agrees that all claims in respect of any such action or proceeding may be heard and determined in such court. Each party hereby irrevocably waives, to the fullest extent permitted by applicable law, any objection that it may now or hereafter have to the laying of venue in any such court and any claim that any such action or proceeding brought in any such court has been brought in an inconvenient forum. Each party agrees that a final, non-appealable judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law.
8.3 WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING, OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT, OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS FEE LETTER, THE COMMITMENT LETTER, THE CREDIT AGREEMENT, ANY OTHER LOAN DOCUMENT, OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY. EACH PARTY HERETO CERTIFIES THAT NO REPRESENTATIVE, AGENT, OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER. EACH PARTY ACKNOWLEDGES THAT IT HAS BEEN INDUCED TO ENTER INTO THIS FEE LETTER BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS SET FORTH IN THIS SECTION 8.3.
Section 9 — Relationship to Commitment Letter
9.1 This Fee Letter is the "Fee Letter" referred to in the Commitment Letter and constitutes an integral part thereof. The Commitment Letter and this Fee Letter, together with the Term Sheet attached to the Commitment Letter, collectively embody the entire agreement among the parties with respect to the subject matter hereof and thereof and supersede all prior negotiations, discussions, correspondence, and agreements (whether written or oral) with respect to such subject matter.
9.2 In the event of any conflict or inconsistency between the provisions of this Fee Letter and the provisions of the Commitment Letter, the provisions of this Fee Letter shall govern and control solely with respect to fee amounts, fee percentages, and payment mechanics relating to the Arrangement Fee and the Agent Fee; in all other respects, the Commitment Letter shall control and govern.
9.3 The termination provisions set forth in Section 7 of the Commitment Letter shall apply to this Fee Letter mutatis mutandis. Upon termination of the Commitment Letter in accordance with its terms, this Fee Letter shall automatically and simultaneously terminate without any further action by any party; provided, however, that the following provisions shall survive any such termination: (a) any obligation to pay fees that have already become earned and payable in accordance with the terms hereof prior to such termination; (b) the confidentiality provisions of Section 6 hereof (which shall survive for a period of two (2) years following such termination); (c) the governing law and jurisdiction provisions of Section 8 hereof; and (d) this Section 9.
Section 10 — Counterparts; Electronic Execution
10.1 This Fee Letter may be executed in any number of counterparts (including by different parties in separate counterparts), each of which when so executed and delivered shall be deemed an original, and all of which, taken together, shall constitute one and the same instrument. It shall not be necessary in making proof of this Fee Letter to produce or account for more than one such counterpart.
10.2 Delivery of an executed counterpart of a signature page of this Fee Letter by portable document format (PDF) transmission, facsimile, or other electronic means (including any electronic signature complying with the New York Electronic Signatures and Records Act, N.Y. State Tech. Law §§ 301–309, or any other applicable law regarding electronic signatures) shall be effective as delivery of a manually executed counterpart thereof.
[Remainder of this page intentionally left blank. Signature pages follow.]
IN WITNESS WHEREOF, the parties hereto have caused this Fee Letter to be duly executed and delivered as of the date first written above.
RIDGELINE NATIONAL BANK, N.A. as Sole Lead Arranger, Sole Bookrunner, and Administrative Agent
By: ________
Name: Laura Fitzpatrick
Title: Managing Director, Healthcare Lending
Date: February 10, 2025
Notice Address:
Ridgeline National Bank, N.A. 225 Liberty Street New York, NY 10281
Attention: Laura Fitzpatrick, Managing Director, Healthcare Lending
Telephone: (212) 555-4180
Email: lfitzpatrick@ridgelinenational.com
Accepted and Agreed:
ARDENT HEALTHCARE HOLDINGS INC.
By: ________
Name: Graham Whitfield
Title: President
Date: February 10, 2025
Notice Address:
Ardent Healthcare Holdings Inc. c/o Ardent Capital Management III LLC 599 Lexington Avenue, 34th Floor New York, NY 10022
Attention: Graham Whitfield, Managing Partner & Co-Founder
Telephone: (212) 555-7620
Email: gwhitfield@ardentcapital.com
With a copy (which shall not constitute notice) to:
Calderwood & Harkness LLP 1221 Avenue of the Americas, 40th Floor New York, NY 10020
Attention: Beatrice Holloway, Partner
Telephone: (212) 555-3300
Email: bholloway@calderwoodharkness.com