[sheet: Closing Checklist]
Item No. | Workstream | Document Name | Description | Responsible Party | First Draft Date | Execution / Finalization Date | Filing / Delivery Date | Status | Notes
I. ENTITY FORMATION
1 | I. Entity Formation | Certificate of Formation — Ardent Capital Holdings LLC | Delaware Certificate of Formation for HoldCo; DE File No. 7948231; Registered Agent: Prestige Registered Agents LLC, 850 New Burton Road, Suite 201, Dover, DE 19904; Authorized Person: Marcus Aldridge | Owen Fischer / Calderwood & Harkness LLP | 2024-02-28 | 2024-03-01 (filed with DE SOS) | Complete | EIN: 93-1847225
2 | I. Entity Formation | Certificate of Formation — Ardent GP Intermediate LLC | Delaware Certificate of Formation for GP Intermediate; DE File No. 7948237; Registered Agent: Prestige Registered Agents LLC, 850 New Burton Road, Suite 201, Dover, DE 19904; Authorized Person: Marcus Aldridge | Owen Fischer / Calderwood & Harkness LLP | 2024-02-28 | 2024-03-01 (filed with DE SOS) | Complete | EIN: 93-1847231
3 | I. Entity Formation | Amended and Restated LLC Agreement — Ardent Capital Holdings LLC | HoldCo LLC Agreement; Members: Aldridge (42%), Narayanan (36%), Hsiao (14%), Marchetti (4%), Okonkwo (4%); Managing Members: Aldridge & Narayanan; HoldCo is sole member of ManCo and sole member of GP Intermediate; governed by Delaware law | Nicholas Stern / Owen Fischer / Calderwood & Harkness LLP | 2023-11-15 | 2024-02-28 | Complete | First draft circulated 11/15/2023
4 | I. Entity Formation | LLC Agreement — Ardent GP Intermediate LLC | Single-member LLC agreement; Sole Member: Ardent Capital Holdings LLC; intermediate holding entity between HoldCo and Ardent Capital GP III LLC; governed by Delaware law | Owen Fischer / Calderwood & Harkness LLP | 2023-11-15 | 2024-02-28 | Complete
II. AMENDED GOVERNING DOCUMENTS
5 | II. Amended Governing Documents | Second Amended and Restated LLC Agreement — Ardent Capital GP III LLC | Reflects withdrawal of Kellner and Trask as members; substitution of Ardent GP Intermediate LLC as sole member; updated GP commitment allocation reflecting assumption of $3,402,000 unfunded departing commitment; updated indemnification; conforming changes to LPA Sections 8.3 and 9.7 | Nicholas Stern / Owen Fischer / Calderwood & Harkness LLP | 2023-11-15 | 2024-02-28 | Complete | GP EIN: 84-3291063
6 | II. Amended Governing Documents | Second Amended and Restated LLC Agreement — Ardent Capital Management LLC | Reflects Ardent Capital Holdings LLC as sole member (replacing five individual principals); revised ManCo Profit Share distribution provisions (~$17,150,000/yr allocated through HoldCo); updated key-personnel and regulatory compliance provisions; SEC RIA CRD #298417 | Nicholas Stern / Owen Fischer / Calderwood & Harkness LLP | 2023-11-15 | 2024-02-28 | Complete | ManCo EIN: 84-3291070
7 | II. Amended Governing Documents | Amendment No. 1 to the Amended and Restated Agreement of Limited Partnership — Ardent Capital Partners III LP | Reflects restructuring of GP ownership through intermediate holding company structure; amends defined terms (General Partner, Key Persons, Management Company); updates GP commitment provisions for assumption of $3,402,000 unfunded departing commitments; conforming changes to Sections 5.2, 8.3, 9.4; LPAC consent obtained 2/14/2024 | Nicholas Stern / Owen Fischer / Calderwood & Harkness LLP | 2024-01-19 | 2024-02-28 | Complete | Fund EIN: 84-3291057
8 | II. Amended Governing Documents | Member Consent Resolutions — Ardent Capital GP III LLC | Written consent of all five members (Aldridge, Narayanan, Kellner, Trask, Hsiao) approving: restructuring and HoldCo/GP Intermediate formation; economics realignment; withdrawal of Kellner and Trask; admission of GP Intermediate as sole member; execution of all restructuring documents; filing of LPA Amendment No. 1; authorization of officers | Owen Fischer / Calderwood & Harkness LLP | 2024-02-14 | 2024-02-28 | Complete
III. CARRY & ECONOMICS
9 | III. Carry & Economics | Amended and Restated Carried Interest Allocation Agreement | Post-restructuring carry allocations (20% of net profits, 8% preferred return, full catch-up): Aldridge 42%, Narayanan 36%, Hsiao 14%, Marchetti 4%, Okonkwo 4%; vesting schedules for Marchetti & Okonkwo; clawback (100% joint and several, 30% individual escrow); carve-outs for Kellner retained carry ($13,140,000) and Trask retained carry ($6,307,200); governed by Delaware law | Nicholas Stern / Owen Fischer / Calderwood & Harkness LLP | 2023-12-08 | 2024-02-28 | Complete | Accrued carry as of 9/30/2023: $87,600,000
10 | III. Carry & Economics | Management Fee Sharing and Profit Allocation Agreement | HoldCo-level agreement allocating ManCo Profit Share (~$17,150,000/yr = 35% of $49,000,000 annual management fee): Aldridge 42% ($7,200,000), Narayanan 36% ($6,170,000), Hsiao 14% ($2,400,000), Marchetti 4% ($690,000), Okonkwo 4% ($690,000); quarterly distributions; true-up adjustments; governed by Delaware law | Nicholas Stern / Owen Fischer / Calderwood & Harkness LLP | 2023-12-08 | 2024-02-28 | Complete
11 | III. Carry & Economics | Co-Investment Allocation Policy (Revised) | Updated co-invest allocation policy; addresses 9 side letters with co-invest priority rights; removes Kellner and Trask from co-invest eligibility; updated allocation percentages consistent with restructured economics | Owen Fischer / Stephen Adler / Calderwood & Harkness LLP | 2024-01-19 | 2024-02-28 | Complete
IV. DEPARTING PRINCIPALS
12 | IV. Departing Principals | Separation and Release Agreement — David Kellner | Effective 3/31/2024 (retirement); withdrawal from GP and ManCo; transition to Senior Advisor; 100% vested carry retained ($13,140,000); clawback 3 yrs post-retirement; escrow $3,942,000 for 3 yrs; unfunded GP commitment of $1,890,000 assumed by HoldCo members pro rata; non-compete 18 mo; non-solicit employees 24 mo; non-solicit LPs 24 mo; COBRA 24 mo (~$52,000); mutual general release; governed by Delaware law | Nicholas Stern / Owen Fischer / Calderwood & Harkness LLP | 2023-12-08 | 2024-02-28 | Complete | Counterparty counsel: Richard Beaulieu / Hannah Polk, Whitford & Chase LLP
13 | IV. Departing Principals | Senior Advisor Agreement — David Kellner | 2-year advisory term; $350,000/yr ($700,000 total); effective 3/31/2024; max 10 hrs/month; confidentiality obligations; governed by Delaware law | Owen Fischer / Calderwood & Harkness LLP | 2023-12-08 | 2024-02-28 | Complete
14 | IV. Departing Principals | Separation and Release Agreement — Joanna Trask | Effective 4/15/2024 (voluntary departure); withdrawal from GP and ManCo; retains 60% vested carry ($6,307,200); forfeits 40% vested carry ($4,204,800) and 100% unvested carry; clawback 2 yrs; escrow adjusted to $1,892,160 (release of $1,257,840 from existing $3,150,000); unfunded GP commitment of $1,512,000 assumed by HoldCo members pro rata; separation payment $1,250,000 within 30 days; non-compete 12 mo; non-solicit employees 18 mo; non-solicit LPs 18 mo; mutual general release; governed by Delaware law | Nicholas Stern / Owen Fischer / Calderwood & Harkness LLP | 2023-12-08 | 2024-02-28 | Complete | First draft 12/8/2023; W&C counter 1/12/2024; revised version 1/19/2024; execution 2/28/2024
15 | IV. Departing Principals | Carry Retention and Clawback Side Letter — David Kellner | 100% vested carry ($13,140,000 as of 9/30/2023); clawback 3 yrs post-retirement; escrow $3,942,000 for 3 yrs; distribution mechanics through Ardent GP Intermediate LLC; reporting obligations | Owen Fischer / Calderwood & Harkness LLP | 2024-01-19 | 2024-02-28 | Complete
16 | IV. Departing Principals | Carry Retention and Clawback Side Letter — Joanna Trask | 60% vested carry retained ($6,307,200); 40% vested carry forfeited ($4,204,800); 100% unvested carry forfeited; clawback 2 yrs; escrow adjusted to $1,892,160; partial release $1,257,840; distribution mechanics; reporting obligations | Owen Fischer / Calderwood & Harkness LLP | 2024-01-19 | 2024-02-28 | Complete
17 | IV. Departing Principals | Cover Letter to Whitford & Chase LLP re: Revised Trask Separation Terms | Letter from Owen Fischer to Richard Beaulieu transmitting revised Trask separation agreement; responds to W&C counter-proposals of 1/12/2024; addresses carry retention (60% vs. requested 75%), non-compete (12 mo vs. requested 6 mo), separation payment ($1,250,000 agreed), escrow release mechanics | Owen Fischer / Calderwood & Harkness LLP | 2024-01-19 | 2024-01-19 (sent) | Complete
V. LP CONSENT & NOTIFICATION
18 | V. LP Consent & Notification | LPAC Notification and Consent Solicitation Letter | Letter to LPAC members (Ridgeline — Thomas Engström; Crestwood — Annika Johansson; Pinnacle — Derek Mallinson; Graystone — Catherine Whitfield) notifying of restructuring, HoldCo formation, economics realignment, Kellner/Trask departures; solicits consent under LPA Section 9.4 | Owen Fischer / Calderwood & Harkness LLP | 2024-01-19 | 2024-02-05 (sent) | Complete
19 | V. LP Consent & Notification | LPAC Presentation Memorandum | Summary for LPAC virtual meeting 2/14/2024: rationale; new entity structure (HoldCo → GP Intermediate → GP; HoldCo → ManCo); post-restructuring carry splits; departing principal terms; no change to investment strategy, mgmt fee, or fund term; key-person analysis (no Key Person Event); side-letter compliance summary | Nicholas Stern / Owen Fischer / Calderwood & Harkness LLP | 2024-01-19 | 2024-02-05 | Complete | Presented at virtual meeting 2/14/2024
20 | V. LP Consent & Notification | Form of Written Consent — LPAC | Consent covering: HoldCo and GP Intermediate formation; GP LLC agreement amendment; ManCo LLC agreement amendment; LPA Amendment No. 1; carry reallocation; Kellner and Trask departures | Owen Fischer / Calderwood & Harkness LLP | 2024-01-19 | 2024-02-14 (obtained) | Complete | Consent obtained at 2/14/2024 LPAC meeting
21 | V. LP Consent & Notification | LP Notification Letter — All 47 Limited Partners | Letter from GP to all 47 LPs notifying of completed restructuring, HoldCo formation, economics realignment, Kellner/Trask departures, LPAC consent obtained 2/14/2024, LPA Amendment No. 1 executed; confirms no change to investment strategy, mgmt fee rates (1.75% investment period / 1.50% post-investment period), or fund term (12/31/2029) | Owen Fischer / Stephen Adler / Calderwood & Harkness LLP | 2024-02-22 | 2024-03-05 (sent) | Complete | Sent to all 47 LPs
22 | V. LP Consent & Notification | Side-Letter Compliance and Key-Person Analysis Memorandum | Analysis of 14 side letters: 11 with MFN (no issues); 6 with expanded key-person naming Kellner as Contributing Person (notification within 15 business days; 3 grant 90-day investment period suspension right); 8 with fee discount/rebate (no impact); 4 requiring prior notice/consent for material management structure changes (Ridgeline, Pinnacle, Crestwood, Haverford Capital Partners); 9 with co-invest priority rights; no Key Person Event under LPA Section 5.2 | Owen Fischer / Stephen Adler / Calderwood & Harkness LLP | 2024-02-05 | 2024-02-22 | Complete
VI. REGULATORY
23 | VI. Regulatory | SEC Form ADV Amendment — Summary of Changes Memorandum | Internal memo summarizing Form ADV changes for Ardent Capital Management LLC (CRD #298417): updated ownership (HoldCo as sole member); removal of Kellner/Trask as control persons; addition of Marchetti/Okonkwo as supervised persons; updated org chart; updated Schedule D (Fund III) | Stephen Adler / Calderwood & Harkness LLP | 2024-02-22 | 2024-03-10 (filed) | Complete
24 | VI. Regulatory | Draft Form ADV Part 2A Brochure Supplement — Updated Schedule of Key Personnel | Updated key personnel: Aldridge (Co-Founder & Managing Partner), Narayanan (Co-Founder & Managing Partner), Hsiao (Partner), Marchetti (Principal), Okonkwo (Principal); removes Kellner and Trask; updated educational/business backgrounds | Stephen Adler / Calderwood & Harkness LLP | 2024-02-22 | 2024-03-10 (filed) | Complete
VII. COORDINATION
25 | VII. Coordination | Letter to Pemberton Hale LLP re: Coordination of Fund Counsel Responsibilities | Letter from Nicholas Stern to Victoria Langford (Pemberton Hale LLP) advising of C&H engagement; delineates scope (C&H handles all restructuring documentation, LP consents, regulatory filings; Pemberton Hale continues routine fund operations, portfolio transactions, ongoing LP communications); requests copies of all 14 side letters and current form of LPA | Nicholas Stern / Calderwood & Harkness LLP | 2023-10-16 | 2023-10-16 (sent) | Complete | Pemberton Hale: One Liberty Plaza, 40th Floor, New York, NY 10006
26 | VII. Coordination | Email to Heathrow Whitman & Co. re: Tax Reporting Implications of Restructuring | Email from Sylvia Hartwell to Paul Devereux (Heathrow Whitman & Co.) outlining tax reporting implications: Fund (EIN 84-3291057), GP (EIN 84-3291063), ManCo (EIN 84-3291070), HoldCo (EIN 93-1847225), GP Intermediate (EIN 93-1847231); Schedule K-1 changes; carry reallocation mechanics; treatment of Kellner/Trask departing interests; entity-level filing timing | Sylvia Hartwell / Calderwood & Harkness LLP | 2024-02-14 | 2024-02-14 (sent) | Complete | Heathrow Whitman: 1345 Avenue of the Americas, 18th Floor, New York, NY 10105
[sheet: Summary]
Field | Value
Matter | Ardent Capital Partners III LP — Management Company Restructuring & Economics Realignment
Client | Ardent Capital Management LLC
Client Address | 590 Madison Avenue, 28th Floor, New York, NY 10022
Fund | Ardent Capital Partners III LP (Delaware LP)
Fund EIN | 84-3291057
General Partner | Ardent Capital GP III LLC (Delaware LLC)
GP EIN | 84-3291063
Management Company | Ardent Capital Management LLC (Delaware LLC; SEC RIA CRD #298417)
ManCo EIN | 84-3291070
New Entity — HoldCo | Ardent Capital Holdings LLC (Delaware LLC; DE File No. 7948231; EIN 93-1847225)
New Entity — GP Intermediate | Ardent GP Intermediate LLC (Delaware LLC; DE File No. 7948237; EIN 93-1847231)
Registered Agent (DE) | Prestige Registered Agents LLC, 850 New Burton Road, Suite 201, Dover, DE 19904
Governing Law | Delaware
Counsel — Restructuring | Calderwood & Harkness LLP (One Vanderbilt Avenue, 44th Floor, New York, NY 10017)
Responsible Partner | Nicholas Stern
Billing Partner | Graham Sutherland
Lead Associate | Owen Fischer
Working Associate | Stephen Adler
Specialist Partner (Tax) | Sylvia Hartwell
Counsel — Departing Principals | Whitford & Chase LLP (200 Park Avenue, Suite 4200, New York, NY 10166) — Richard Beaulieu (Partner), Hannah Polk (Associate)
Counsel — Fund Formation (ongoing) | Pemberton Hale LLP (One Liberty Plaza, 40th Floor, New York, NY 10006) — Victoria Langford (Partner)
Auditor / Tax Advisor | Heathrow Whitman & Co. — Paul Devereux, CPA
Valuation Advisor | Broadleaf Consulting Group — Martin Schreiber, ASA
Placement Agent | Lockwood Placement Partners LLC — Sarah Fontaine
Engagement Opened | October 9, 2023
Engagement Closed | March 15, 2024
Documents Executed | February 28, 2024
HoldCo / GP Intermediate Formed (DE) | March 1, 2024
LPAC Consent Obtained | February 14, 2024
LP Notification Sent | March 5, 2024
Form ADV Amendment Filed | March 10, 2024
Kellner Retirement Effective | March 31, 2024
Trask Departure Effective | April 15, 2024
Total Fund Commitments | $2,800,000,000
GP Commitment | $42,000,000 (1.5%)
Number of LPs | 47
Number of Side Letters | 14
Number of Portfolio Companies | 11
Accrued Carry (9/30/2023) | $87,600,000
Total Deliverables | 26
Deliverables Complete | 26 of 26 (100%)
Actual Legal Fees | $978,500
Disbursements | $14,200
Total Billed | $992,700
Checklist Prepared By | Owen Fischer, Calderwood & Harkness LLP
Checklist Reviewed By | Nicholas Stern, Calderwood & Harkness LLP
[sheet: GP Commitment Reallocation]
Principal | Role | Pre-Restructuring GP % | Total GP Commitment ($) | Funded to Date ($) | Unfunded Commitment ($) | Post-Restructuring HoldCo % | Assumed Unfunded from Departing ($) | New Total Unfunded ($) | Notes
Marcus Aldridge | Co-Founder & Managing Partner (Remaining) | 35% | $14,700,000 | $10,290,000 | $4,410,000 | 42% | $1,428,840 | $5,838,840 | Rounding adjustments allocated here
Priya Narayanan | Co-Founder & Managing Partner (Remaining) | 30% | $12,600,000 | $8,820,000 | $3,780,000 | 36% | $1,224,720 | $5,004,720
Robert Hsiao | Partner (Remaining) | 8% | $3,360,000 | $2,352,000 | $1,008,000 | 14% | $476,280 | $1,484,280
Elena Marchetti | Principal (Next-Gen) | 0% | $0 | $0 | $0 | 4% | $136,080 | $136,080 | New GP commitment participant
Samuel Okonkwo | Principal (Next-Gen) | 0% | $0 | $0 | $0 | 4% | $136,080 | $136,080 | New GP commitment participant
David Kellner | Senior Partner (Departing — Retirement) | 15% | $6,300,000 | $4,410,000 | $1,890,000 | N/A | N/A | N/A | Unfunded $1,890,000 assumed by remaining members; effective 3/31/2024
Joanna Trask | Partner (Departing — Voluntary) | 12% | $5,040,000 | $3,528,000 | $1,512,000 | N/A | N/A | N/A | Unfunded $1,512,000 assumed by remaining members; effective 4/15/2024
TOTAL | 100% | $42,000,000 | $29,400,000 | $12,600,000 | 100% | $3,402,000 | $12,600,000 | Combined departing unfunded: $3,402,000
[sheet: Economics Realignment]
Principal | Status | Pre-Restructuring Carry % | Post-Restructuring Carry % | Change (pp) | Pre-Restructuring ManCo Profit Share ($) | Post-Restructuring ManCo Profit Share ($) | Accrued Carry — Pre-Restructuring Notional ($) | Accrued Carry — Post-Restructuring Notional ($) | Notes
Marcus Aldridge | Remaining | 35% | 42% | +7 | $6,002,500 | $7,203,000 | $30,660,000 | $36,792,000
Priya Narayanan | Remaining | 30% | 36% | +6 | $5,145,000 | $6,174,000 | $26,280,000 | $31,536,000
Robert Hsiao | Remaining | 8% | 14% | +6 | $1,372,000 | $2,401,000 | $7,008,000 | $12,264,000
Elena Marchetti | Next-Gen (New) | 0% | 4% | +4 | $0 | $686,000 | $0 | $3,504,000 | Subject to vesting
Samuel Okonkwo | Next-Gen (New) | 0% | 4% | +4 | $0 | $686,000 | $0 | $3,504,000 | Subject to vesting
David Kellner | Departing (Retirement) | 15% | N/A | -15 | $2,572,500 | $0 | $13,140,000 | Retained: $13,140,000 (100% vested) | Carry retained per separation agreement; clawback 3 yrs
Joanna Trask | Departing (Voluntary) | 12% | N/A | -12 | $2,058,000 | $0 | $10,512,000 | Retained: $6,307,200 (60% vested); Forfeited: $4,204,800 | Carry partially retained per separation agreement; clawback 2 yrs
TOTAL | 100% | 100% | $17,150,000 | $17,150,000 | $87,600,000
[sheet: Key Dates]
Date | Event | Workstream | Notes
2019-04-15 | Fund III final close | Background | Total commitments: $2,800,000,000; 47 LPs
2019-06-30 | Investment period commencement | Background | Investment period ends 6/30/2025
2023-09-30 | Most recent quarterly valuation | Background | Gross MOIC: 1.42x; Net IRR: 14.7%; Unrealized value: $2,330,000,000; Realized proceeds: $445,000,000; Accrued carry: $87,600,000
2023-10-09 | Calderwood & Harkness engagement opened | Engagement | Engagement letter executed; estimated fees $850,000–$1,100,000
2023-10-16 | Initial organizational call; receipt of governing documents | Engagement | Letter sent to Pemberton Hale LLP re coordination
2023-11-02 | Kellner retirement and Trask departure confirmed by Aldridge/Narayanan | Departing Principals
2023-11-15 | First draft HoldCo LLC Agreement circulated | Entity Formation
2023-11-22 | Tax structuring memo delivered by Sylvia Hartwell | Tax | IRC Section 721 analysis; Section 704(b)/(c) allocation
2023-12-08 | First draft separation agreements sent to Whitford & Chase LLP | Departing Principals | Kellner and Trask separation agreements
2024-01-12 | Whitford & Chase counter on Trask separation terms received | Departing Principals | Key issues: carry retention %, non-compete duration, separation payment
2024-01-19 | Revised Trask separation agreement circulated | Departing Principals | Cover letter from Owen Fischer to Richard Beaulieu
2024-02-05 | LPAC notification and consent solicitation letters sent | LP Consent | Sent to 4 LPAC members
2024-02-14 | LPAC virtual meeting; consent obtained | LP Consent | Consent under LPA Section 9.4
2024-02-22 | Side-letter compliance memo finalized | LP Consent | 14 side letters analyzed; no Key Person Event under Section 5.2
2024-02-28 | All restructuring documents executed | Closing | All 26 deliverables completed
2024-03-01 | HoldCo and GP Intermediate formed (DE Certificates of Formation filed) | Entity Formation | DE File Nos. 7948231 and 7948237
2024-03-05 | LP notification letters sent to all 47 LPs | LP Notification
2024-03-10 | SEC Form ADV amendment filed | Regulatory | CRD #298417
2024-03-15 | Engagement closed — all workstreams complete | Engagement | Total billed: $992,700 ($978,500 fees + $14,200 disbursements)
2024-03-31 | David Kellner retirement effective | Departing Principals | Transitions to Senior Advisor
2024-04-15 | Joanna Trask departure effective | Departing Principals
2025-06-30 | Investment period end date | Fund Term | Management fee shifts to 1.50% on invested capital
2029-12-31 | Fund term expiration | Fund Term | Subject to two one-year extensions at GP discretion