1026-00001 · Briarwood Family Office LLC · Side-Letter Negotiation

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CALDERWOOD & HARKNESS LLP 425 Lexington Avenue New York, New York 10017

PRIVILEGED & CONFIDENTIAL ATTORNEY-CLIENT COMMUNICATION ATTORNEY WORK PRODUCT

MEMORANDUM

March 12, 2024

TO: Pamela Cross, Partner, Calderwood & Harkness LLP Sandra M. Whitfield, General Counsel, Briarwood Family Office LLC Derek T. Calloway, Director of External Investments, Briarwood Family Office LLC

FROM: Theresa Kim, Lead Associate, Calderwood & Harkness LLP

RE: Summary of Conference Call — Side-Letter Negotiation, Briarwood Family Office LLC / Meridian Peak Capital Partners Fund IV, L.P.

MATTER NO.: 1026-00001

REFERENCE DOCUMENTS:

(i) Second Draft Side Letter (dated March 7, 2024)

(ii) GP Markup of First Draft Side Letter (received March 4, 2024)

(iii) Fund IV Limited Partnership Agreement (dated December 20, 2023)

This memorandum summarizes the conference call held on March 11, 2024, among counsel and principals for Briarwood Family Office LLC ("BFO") and Meridian Peak Capital Partners Fund IV, L.P. (the "Fund" or "Fund IV"), and is prepared for the sole purpose of memorializing the substantive discussions and agreed-upon outcomes from the call. This memorandum constitutes attorney work product and a privileged and confidential attorney-client communication. It should not be distributed to any person or entity other than the named addressees without prior approval from Calderwood & Harkness LLP.

I. CALL DETAILS

Date: Monday, March 11, 2024

Time: 2:00 p.m. – 3:15 p.m. Eastern Time (approximately 75 minutes)

Format: Telephone conference call

Participants:

Calderwood & Harkness LLP (Counsel to BFO):

• Pamela Cross, Partner

• Theresa Kim, Lead Associate

Briarwood Family Office LLC:

• Sandra M. Whitfield, General Counsel

• Derek T. Calloway, Director of External Investments

Ashford Crane & Hewitt LLP (Counsel to GP/Fund):

• Harrison K. Drummond, Partner

• Elaine C. Woodbury, Senior Associate

Meridian Peak Capital Advisors LLC (Fund Sponsor):

• Gavin R. Lockhart, Partner, Head of Investor Relations

• Tamara Fujimoto, General Counsel & Chief Compliance Officer

II. PURPOSE OF CALL

The conference call was convened as a four-party negotiation session to address the remaining open points in the side-letter negotiation between Briarwood Family Office LLC, as a prospective limited partner with a proposed commitment of $75 million, and Meridian Peak Capital Partners Fund IV, L.P., a Delaware limited partnership with a target fund size of $1.5 billion and a hard cap of $1.75 billion. The general partner of the Fund is Meridian Peak Capital Partners GP IV LLC, and the fund sponsor and investment adviser is Meridian Peak Capital Advisors LLC ("MPCA").

The call followed the exchange of the second draft side letter, transmitted by Calderwood & Harkness LLP to Ashford Crane & Hewitt LLP on March 7, 2024. The second draft incorporated certain of the GP's comments from its first markup of the initial BFO-proposed side letter (received by Calderwood & Harkness on March 4, 2024), while maintaining several BFO positions on which the parties had not yet reached agreement.

The primary open issues identified for discussion on the call were as follows:

(1) the scope and cap of BFO's excuse/exclusion rights (Section 3 of the draft side letter);

(2) the MFN provision's anchor investor carve-out scope, including threshold and election mechanics (Section 2);

(3) the key person suspension duration and trigger mechanism (Section 7); and

(4) certain secondary points relating to co-investment mechanics, enhanced reporting obligations, and K-1 delivery timelines.

The discussion proceeded on a topic-by-topic basis, and the substantive outcomes are summarized below in the order in which they were addressed on the call.

III. SUMMARY OF DISCUSSION AND OUTCOMES BY TOPIC

A. Key Person Suspension Provision (Section 7 of Draft Side Letter)

Background. In the first draft side letter, BFO proposed a 90-day suspension of the investment period upon the departure of either Conrad J. Ellsworth (Co-Founder, Managing Partner & Chief Executive Officer of MPCA) or Priya Narayan (Co-Founder, Managing Partner & Chief Investment Officer of MPCA) from their respective active management roles. During the suspension period, BFO would have the right to elect to cease participation in future capital calls. In its first markup, the GP rejected this provision in its entirety, taking the position that the standard key person provisions set forth in Article 12 of the Fund IV Limited Partnership Agreement were sufficient and that granting LP-specific suspension rights would create operational complexity and could set an adverse precedent for other investors. In the second draft, Calderwood & Harkness narrowed the proposed suspension period from 90 days to 60 days as a compromise measure, while preserving the underlying structure of BFO's right to elect to cease future capital calls during the suspension window.

Discussion. Harrison Drummond opened the discussion on this point by stating that Meridian Peak, after internal deliberation among the fund's principals, would accept a 90-day suspension period — thereby reverting to BFO's original proposed position. Drummond noted that this concession was conditioned on the understanding that the key person suspension provision in the side letter would supplement, but would not replace, the standard key person event provisions contained in the Limited Partnership Agreement. In other words, the side letter right would operate as an additional protective mechanism available exclusively to BFO, running in parallel with the fund-wide key person provisions applicable to all limited partners under the LPA.

Tamara Fujimoto confirmed that this approach was acceptable to the fund sponsor. She noted that MPCA's primary concern had been ensuring that the side letter did not purport to modify or override the LPA's key person provisions, and that so long as the side letter clearly stated its supplementary nature, the GP was comfortable with the 90-day suspension window.

Pamela Cross confirmed that BFO's position had always been that the side letter provision was intended to be additive to the LPA protections, not a replacement, and that the next draft would make this explicit through appropriate cross-referencing language.

The parties confirmed that the trigger for the suspension would remain the departure of either Ellsworth or Narayan from their active management roles at MPCA, consistent with BFO's original proposal.

Outcome: AGREED. The key person suspension provision will provide for a 90-day suspension period upon the departure of either Conrad J. Ellsworth or Priya Narayan from active management roles at MPCA. The provision supplements but does not replace the standard key person provisions in the LPA. During the 90-day suspension period, BFO retains the right to elect to cease participation in future capital calls. Calderwood & Harkness to reflect this agreed position in the next draft of the side letter.

B. Most Favored Nation (MFN) — Anchor Investor Carve-Out (Section 2 of Draft Side Letter)

Background. The MFN provision, as currently drafted in Section 2 of the side letter, entitles BFO to elect to receive the benefit of any economic or governance term granted by the GP to any other limited partner committing $50 million or more to Fund IV, subject to certain enumerated exclusions. The principal exclusion at issue on the call relates to terms granted to "Anchor Investors," defined in the draft as limited partners committing $200 million or more to the Fund. At the target fund size of $1.5 billion, the $200 million Anchor Investor threshold represents approximately 13.33% of aggregate commitments. The remaining MFN exclusions — which cover (a) regulatory accommodations for ERISA-plan, tax-exempt, or governmental-plan investors, and (b) terms made available to GP affiliates and related persons — have been agreed and are not in dispute.

Discussion. Sandra Whitfield raised the question of whether the $200 million Anchor Investor threshold was a firm position on the part of Meridian Peak or whether the GP would consider lowering the threshold, noting that a lower threshold could potentially narrow the range of terms shielded from BFO's MFN election rights. Gavin Lockhart responded that the $200 million threshold is consistent across all Fund IV side letters and reflects a business determination by the GP that is not subject to modification. Lockhart noted that the threshold was established early in the fundraising process and has been applied uniformly to all investor negotiations. Harrison Drummond added that, in his experience, a threshold in the range of 10–15% of target fund size for the anchor investor carve-out is broadly consistent with current market practice for funds of comparable size and strategy, and that the $200 million figure falls squarely within that range.

Pamela Cross acknowledged BFO's position and stated that, having considered the GP's response and the market context, she agreed that the $200 million threshold is reasonable and that BFO would not press the point further.

Discussion of MFN Mechanics. Drummond also confirmed the procedural mechanics of the MFN provision. The GP will deliver a redacted summary of all material side-letter terms granted to other limited partners to BFO within 15 business days of the applicable closing at which BFO is admitted to the Fund. Upon receipt of the summary, BFO will have a period of 20 business days (the "MFN Election Period") to notify the GP of BFO's election to adopt any additional terms. These mechanics were consistent with the current draft language and were not in dispute. (Note: subsequent discussion regarding a potential revision to the GP's delivery period is addressed separately in Section III.J below.)

Outcome: AGREED. The Anchor Investor carve-out threshold is confirmed at $200 million. MFN election mechanics remain as previously drafted: 15 business days for the GP to deliver the redacted summary of side-letter terms following the applicable close; 20 business days for BFO to exercise its MFN election rights. No changes are needed in the next draft on this point, subject to the separate bracketed issue regarding the GP's delivery timeline discussed in Section III.J.

C. Excuse/Exclusion Rights Cap (Section 3 of Draft Side Letter)

Background. Section 3 of the draft side letter grants BFO the right to be excused from participation in investments involving the following categories:

(a) cannabis-related assets (including direct cultivation, processing, distribution, and ancillary cannabis businesses);

(b) gaming and casino properties (including gaming equipment manufacturers and operators of gaming establishments);

(c) investments in jurisdictions that are subject to comprehensive sanctions administered by the U.S. Department of the Treasury's Office of Foreign Assets Control ("OFAC") or otherwise subject to U.S. economic sanctions; and

(d) any investment that would cause BFO to be treated as holding "plan assets" under the Employee Retirement Income Security Act of 1974, as amended ("ERISA").

The exercise period for the excuse right is 15 business days from BFO's receipt of a capital call notice identifying a proposed investment falling within one of the excluded categories. The dispute between the parties concerns the aggregate cap on excused investments, expressed as a percentage of BFO's $75 million commitment. In its first markup, the GP proposed a cap of 15% of commitment ($75,000,000 × 15% = $11,250,000). Calderwood & Harkness counter-proposed a cap of 25% of commitment ($75,000,000 × 25% = $18,750,000) in the second draft, where the figure was presented in brackets to reflect the ongoing disagreement.

Discussion. Drummond stated that the GP has moved from its original 15% position and is now willing to accept a cap of 20% of BFO's commitment ($75,000,000 × 20% = $15,000,000). Fujimoto elaborated on the GP's rationale for the revised position, explaining that MPCA is concerned about the potential impact of excessive excuse rights on the GP's ability to deploy capital predictably and manage fund-level cash flow. She noted that a 20% cap represents a meaningful concession from the GP's 15% opening position and should be viewed in the context of the Fund's investment strategy, which may include a material number of transactions touching the cannabis and gaming sectors. Fujimoto further stated that the GP has reviewed its current pipeline and believes that investments in the cannabis-adjacent and gaming categories could constitute a meaningful portion of Fund IV's deployment activity, making it important for the GP to have reasonable certainty as to committed capital availability.

Whitfield responded that BFO's strong preference remains a 25% cap ($18,750,000). She emphasized that the breadth of the excluded categories — particularly the combination of cannabis-related assets and gaming/casino properties — increases the likelihood that a significant number of Fund IV investments could trigger BFO's excuse rights. Whitfield noted that if the GP's pipeline projections are correct and a substantial portion of Fund IV's capital is deployed in these sectors, a 20% cap could prove insufficient to protect BFO's policy-based restrictions.

Derek Calloway provided additional context, noting that BFO's investment policy committee has imposed a strict prohibition on cannabis and gaming exposure across all Briarwood portfolios, and that this prohibition is not a negotiable point for the Hargrove family. Calloway stated that BFO needs sufficient headroom under the excuse cap to ensure it can comply with its own internal investment guidelines without being forced to participate in prohibited investments or having its excuse rights exhausted prematurely.

Cross stated that BFO would take the 20% versus 25% question under advisement but would not concede the point on the call. She noted that this is a point on which BFO feels strongly and that additional internal deliberation would be required before BFO could accept the GP's revised position.

Outcome: NOT AGREED — REMAINS OPEN. The GP's position is a 20% cap on excused investments ($15,000,000). BFO's position is a 25% cap ($18,750,000). The next draft will reflect this as a bracketed point: [20%/25%]. Calderwood & Harkness recommends that BFO evaluate internally whether the 20% cap is acceptable or whether this is a point to be escalated in subsequent negotiations.

D. Co-Investment Rights (Section 5 of Draft Side Letter)

Background. BFO proposed a pro rata co-investment opportunity on all Fund IV transactions exceeding $100 million in equity. The co-investment would be offered at no management fee and no carried interest, with BFO's participation limited to its pro rata share based on its commitment relative to total fund commitments.

Discussion. Elaine Woodbury raised a process-related point regarding the timing of co-investment notices. She noted that the current draft did not specify the minimum notice period for co-investment opportunities and requested that the side letter include a provision requiring the GP to deliver co-investment notices to BFO at least 10 business days prior to the anticipated closing of the applicable co-investment transaction. Woodbury explained that this lead time is necessary to allow the GP to manage the closing process and coordinate with other co-investors.

Cross agreed that a defined notice period was reasonable and practical. She proposed reciprocal language requiring BFO to respond to any co-investment notice within 5 business days of receipt, thereby providing the GP with certainty as to BFO's participation in advance of the transaction closing. Lockhart confirmed that the $100 million equity threshold and the no-management-fee/no-carried-interest terms are acceptable to the GP and that MPCA views the co-investment framework as appropriately structured.

No other issues were raised with respect to co-investment rights. The parties were aligned on the substantive terms, and the only addition to the next draft will be the notice timing mechanics described above.

Outcome: SUBSTANTIALLY AGREED. Co-investment terms are accepted on the basis proposed in the second draft. A minor drafting point on notice timing will be incorporated in the next draft: the GP will provide co-investment notices at least 10 business days prior to the anticipated closing of the applicable transaction, and BFO will respond to such notices within 5 business days of receipt.

E. Enhanced Reporting (Section 6 of Draft Side Letter)

Discussion. The parties engaged in a brief discussion confirming the previously agreed enhanced reporting framework. The reporting obligations are as follows:

(a) Quarterly Portfolio-Level Reports: The GP will deliver quarterly portfolio-level performance reports to BFO within 45 days following the end of each fiscal quarter. Gavin Lockhart noted that Granite Ledger Fund Services LLC, the Fund's third-party fund administrator, will coordinate the preparation and distribution of the quarterly reports.

(b) Audited Annual Financial Statements: The GP will deliver audited annual financial statements for the Fund within 90 days following the end of each fiscal year. The audit will be conducted by Brockton Marsh & Associates LLP, the Fund's independent auditor.

(c) Annual ESG Reporting: The GP will provide an annual report on environmental, social, and governance ("ESG") matters relevant to the Fund's portfolio, in a format and with such detail as is consistent with MPCA's ESG reporting framework.

No material changes were proposed to the reporting provisions as set forth in the second draft, and all parties confirmed their agreement with the current language.

Outcome: AGREED. No changes needed in the next draft.

F. Management Fee Reduction (Section 4 of Draft Side Letter)

Discussion. The parties briefly confirmed that the negotiated management fee reduction, which was accepted by the GP in its first markup and has remained agreed since that time, is as follows:

• During the Investment Period: 1.50% per annum on committed capital (reduced from the standard fee of 1.75% per annum, representing a 25 basis point reduction).

• Post-Investment Period: 1.25% per annum on invested capital (reduced from the standard fee of 1.50% per annum, representing a 25 basis point reduction).

At the proposed $75 million commitment, the fee reduction generates annual savings of approximately $187,500 during the investment period (calculated as $75,000,000 × 0.25% = $187,500). Over a four-year investment period, the cumulative fee savings amount to approximately $750,000. No further discussion was required, and this provision remains fully agreed.

Outcome: AGREED. Already reflected in the current draft. No changes needed.

G. Placement Agent Fee Offset (Section 11 of Draft Side Letter)

Discussion. Drummond confirmed the GP's acceptance of a 100% offset of the placement agent fee payable to Pinnacle Capital Markets LLC against management fees otherwise payable by BFO. Pinnacle's fee on BFO's commitment is calculated as follows: $75,000,000 × 1.0% = $750,000. The offset will be applied pro rata against management fee installments as they become due, such that BFO's net management fee obligation is reduced dollar-for-dollar by the amount of the placement agent fee until the offset is fully absorbed. No open issues remain with respect to this provision.

Outcome: AGREED. Already reflected in the current draft. No changes needed.

H. Transfer Rights (Section 8 of Draft Side Letter)

Discussion. The parties briefly confirmed that BFO's right to transfer its limited partnership interest to any Hargrove family entity without the prior consent of the GP was accepted by the GP in principle during the prior round of negotiations. The transfer right is subject to compliance with applicable securities laws and relevant tax considerations, including but not limited to the avoidance of any transfer that would result in a termination of the Fund for U.S. federal income tax purposes.

Woodbury noted that Ashford Crane will add standard language in the next draft requiring BFO to provide reasonable documentation confirming the transferee's status as a Hargrove family entity. Woodbury indicated that this documentation requirement is consistent with the GP's approach in other side letters and is intended to ensure the GP can verify the family-entity relationship prior to recognizing the transfer on the Fund's books and records.

Cross confirmed that BFO has no objection to a reasonable documentation requirement and that Calderwood & Harkness will review the proposed language when circulated.

Outcome: AGREED, subject to minor drafting refinement regarding transferee documentation. Calderwood & Harkness to review and incorporate Ashford Crane's proposed language in the next draft.

I. Tax Reporting / K-1 Delivery (Section 10 of Draft Side Letter)

Background. BFO requested that the Fund use commercially reasonable efforts to deliver Schedule K-1s to BFO within 75 days of the end of each fiscal year, representing a meaningful acceleration from the standard 120-day delivery period provided in Article 14 of the Limited Partnership Agreement.

Discussion. Fujimoto stated that the GP's preference remains a 90-day delivery target. She explained that the complexity of the Fund's multi-jurisdictional investment structure and the need to coordinate the K-1 preparation process with both Brockton Marsh & Associates LLP (the Fund's auditor) and Granite Ledger Fund Services LLC (the Fund's administrator) make a 75-day timeline operationally challenging. Fujimoto acknowledged that the GP appreciates BFO's desire for expedited tax reporting but noted that a commitment to 75 days could require the Fund to incur additional costs for expedited tax preparation services and could result in the delivery of estimated or provisional K-1s, which may subsequently require amendment.

Whitfield responded that BFO's strong preference for the 75-day timeline is driven by the Hargrove family's tax planning needs. She noted that the family's personal tax advisors require early visibility into the Fund's tax attributes in order to prepare estimated tax payments and to coordinate with other investment vehicles in the family's portfolio. Whitfield stated that BFO considers this point important and would prefer not to concede to the 90-day timeline.

This point was not resolved on the call. Both parties maintained their respective positions.

Outcome: NOT AGREED — REMAINS OPEN. GP position: 90 days post fiscal year-end. BFO position: 75 days post fiscal year-end. To be reflected as a bracketed point [75/90 days] in the next draft.

J. MFN Summary Delivery Timing

Discussion. Late in the call, Drummond raised a point regarding the MFN mechanics previously discussed in Section III.B above. Specifically, Drummond stated that the GP's internal position is that 20 business days — rather than the 15 business days specified in the current draft — is the appropriate period for the GP to deliver the redacted summary of side-letter terms to BFO following the applicable closing at which BFO is admitted. Drummond explained that the GP needs additional time to compile, review, and redact the side-letter terms of all admitted limited partners, particularly in connection with a first close at which a large number of investors may be admitted simultaneously. He requested that this revision be reflected as an additional bracketed point in the next draft.

Cross noted that BFO's preference remains 15 business days, consistent with the current draft, in order to ensure that BFO has adequate time to review and exercise its MFN election rights within the overall timeline. Cross stated that BFO would consider the GP's request but was not prepared to agree on the call.

Outcome: NOT AGREED — REMAINS OPEN. GP position: 20 business days for delivery of the redacted MFN summary following the applicable close. BFO position: 15 business days. To be reflected as a bracketed point in the next draft.

K. Confidentiality Carve-Outs (Section 9 of Draft Side Letter)

Discussion. The parties briefly confirmed that the confidentiality carve-outs set forth in Section 9 of the draft side letter have been agreed. The agreed carve-outs permit BFO to disclose confidential information related to the Fund and the side letter to the following categories of recipients:

(a) BFO's tax, legal, and accounting advisors, to the extent reasonably necessary for the provision of professional services;

(b) members of the Hargrove family, including trustees and fiduciaries of Hargrove family trusts and estates; and

No changes from the current draft were proposed, and no further discussion was required.

Outcome: AGREED. No changes needed in the next draft.

IV. SUMMARY OF OPEN POINTS REMAINING AFTER CALL

The following table summarizes the three remaining bracketed or open issues as of the conclusion of the March 11, 2024 call. All other provisions of the side letter are substantively agreed.

It should be noted that the parties reached agreement on all other substantive provisions of the side letter, including the key person suspension provision (Section 7), the MFN anchor investor threshold and election mechanics (Section 2, other than the delivery timing issue noted above), the co-investment rights framework (Section 5), the enhanced reporting obligations (Section 6), the management fee reduction (Section 4), the placement agent fee offset (Section 11), the transfer rights to Hargrove family entities (Section 8), and the confidentiality carve-outs (Section 9). These agreed provisions will be reflected in clean form in the next draft, with only the three items identified above remaining in brackets for further negotiation.

V. NEXT STEPS

The following next steps were identified on the call and through subsequent discussion among Calderwood & Harkness and BFO:

1. Third Draft Side Letter. Calderwood & Harkness will prepare a third draft of the side letter incorporating all outcomes from the March 11 call. The three open points identified in Section IV above will be reflected in brackets. All agreed provisions will be updated to reflect the final agreed language, including the key person suspension reversion to 90 days, the co-investment notice timing mechanics, and the transfer documentation requirement.

2. Target Circulation Date. Calderwood & Harkness's target date for circulation of the third draft to Ashford Crane & Hewitt LLP is March 14, 2024.

3. BFO Pre-Circulation Review. Prior to transmittal to Ashford Crane, Calderwood & Harkness will circulate the third draft to Sandra M. Whitfield and Derek T. Calloway for review and comment.

4. Internal BFO Deliberation on Excuse Cap. BFO is asked to consider internally whether the GP's revised 20% excuse/exclusion cap ($15,000,000) is acceptable, or whether BFO wishes to continue pressing for its 25% position ($18,750,000). Calderwood & Harkness's recommendation is to maintain the 25% position in the third draft with a potential fallback to 20% if needed to close the overall negotiation, provided that BFO's investment policy committee is comfortable with the 20% level of protection.

5. BFO Investment Committee Approval. BFO's proposed commitment of $75 million to Fund IV remains subject to the approval of BFO's investment committee. Approval requires the affirmative vote of at least three of the four investment committee members, and Julian R. Hargrove holds a veto right over any commitment. No side letter or subscription agreement may be executed prior to receipt of investment committee approval. The next investment committee meeting is anticipated for late March 2024.

6. Fund IV Closing Timeline. Fund IV's anticipated first close is April 30, 2024. The final close deadline under the LPA is October 31, 2024. BFO's target is to complete all documentation in advance of the first close, subject to investment committee approval.

VI. DISTRIBUTION AND PRIVILEGE NOTICE

This memorandum was prepared by Theresa Kim, Lead Associate, Calderwood & Harkness LLP, and reviewed by Pamela Cross, Partner, Calderwood & Harkness LLP. Distribution of this memorandum is limited to the named addressees. This memorandum is protected by the attorney-client privilege and constitutes attorney work product. It should not be forwarded, copied, or disclosed to any third party without the prior written consent of Calderwood & Harkness LLP.

A file copy of this memorandum has been saved to the Calderwood & Harkness LLP document management system under Matter No. 1026-00001.

Contact Information:

Theresa Kim Calderwood & Harkness LLP 425 Lexington Avenue New York, NY 10017

PRIVILEGED & CONFIDENTIAL — ATTORNEY-CLIENT COMMUNICATION — ATTORNEY WORK PRODUCT This memorandum is intended solely for the use of the named addressees and contains information that is privileged, confidential, and exempt from disclosure under applicable law. If you are not an intended recipient, please notify the sender immediately and destroy all copies of this document.

No.	Issue	GP Position	BFO Position	Status
1	Excuse/Exclusion Cap (§3)	20% of commitment ($15,000,000)	25% of commitment ($18,750,000)	Open — bracketed
2	MFN Summary Delivery Timing (§2)	20 business days post-close	15 business days post-close	Open — bracketed
3	K-1 Delivery Timeline (§10)	90 days post fiscal year-end	75 days post fiscal year-end	Open — bracketed

CALDERWOOD & HARKNESS LLP 425 Lexington Avenue New York, New York 10017
PRIVILEGED & CONFIDENTIAL ATTORNEY-CLIENT COMMUNICATION ATTORNEY WORK PRODUCT
MEMORANDUM
March 12, 2024
TO: Pamela Cross, Partner, Calderwood & Harkness LLP Sandra M. Whitfield, General Counsel, Briarwood Family Office LLC Derek T. Calloway, Director of External Investments, Briarwood Family Office LLC
FROM: Theresa Kim, Lead Associate, Calderwood & Harkness LLP
RE: Summary of Conference Call — Side-Letter Negotiation, Briarwood Family Office LLC / Meridian Peak Capital Partners Fund IV, L.P.
MATTER NO.: 1026-00001
REFERENCE DOCUMENTS:
(i) Second Draft Side Letter (dated March 7, 2024)
(ii) GP Markup of First Draft Side Letter (received March 4, 2024)
(iii) Fund IV Limited Partnership Agreement (dated December 20, 2023)
This memorandum summarizes the conference call held on March 11, 2024, among counsel and principals for Briarwood Family Office LLC ("BFO") and Meridian Peak Capital Partners Fund IV, L.P. (the "Fund" or "Fund IV"), and is prepared for the sole purpose of memorializing the substantive discussions and agreed-upon outcomes from the call. This memorandum constitutes attorney work product and a privileged and confidential attorney-client communication. It should not be distributed to any person or entity other than the named addressees without prior approval from Calderwood & Harkness LLP.
I. CALL DETAILS
Date: Monday, March 11, 2024
Time: 2:00 p.m. – 3:15 p.m. Eastern Time (approximately 75 minutes)
Format: Telephone conference call
Participants:
Calderwood & Harkness LLP (Counsel to BFO):
•  Pamela Cross, Partner
•  Theresa Kim, Lead Associate
Briarwood Family Office LLC:
•  Sandra M. Whitfield, General Counsel
•  Derek T. Calloway, Director of External Investments
Ashford Crane & Hewitt LLP (Counsel to GP/Fund):
•  Harrison K. Drummond, Partner
•  Elaine C. Woodbury, Senior Associate
Meridian Peak Capital Advisors LLC (Fund Sponsor):
•  Gavin R. Lockhart, Partner, Head of Investor Relations
•  Tamara Fujimoto, General Counsel & Chief Compliance Officer
II. PURPOSE OF CALL
The conference call was convened as a four-party negotiation session to address the remaining open points in the side-letter negotiation between Briarwood Family Office LLC, as a prospective limited partner with a proposed commitment of $75 million, and Meridian Peak Capital Partners Fund IV, L.P., a Delaware limited partnership with a target fund size of $1.5 billion and a hard cap of $1.75 billion. The general partner of the Fund is Meridian Peak Capital Partners GP IV LLC, and the fund sponsor and investment adviser is Meridian Peak Capital Advisors LLC ("MPCA").
The call followed the exchange of the second draft side letter, transmitted by Calderwood & Harkness LLP to Ashford Crane & Hewitt LLP on March 7, 2024. The second draft incorporated certain of the GP's comments from its first markup of the initial BFO-proposed side letter (received by Calderwood & Harkness on March 4, 2024), while maintaining several BFO positions on which the parties had not yet reached agreement.
The primary open issues identified for discussion on the call were as follows:
(1) the scope and cap of BFO's excuse/exclusion rights (Section 3 of the draft side letter);
(2) the MFN provision's anchor investor carve-out scope, including threshold and election mechanics (Section 2);
(3) the key person suspension duration and trigger mechanism (Section 7); and
(4) certain secondary points relating to co-investment mechanics, enhanced reporting obligations, and K-1 delivery timelines.
The discussion proceeded on a topic-by-topic basis, and the substantive outcomes are summarized below in the order in which they were addressed on the call.
III. SUMMARY OF DISCUSSION AND OUTCOMES BY TOPIC
A. Key Person Suspension Provision (Section 7 of Draft Side Letter)
Background. In the first draft side letter, BFO proposed a 90-day suspension of the investment period upon the departure of either Conrad J. Ellsworth (Co-Founder, Managing Partner & Chief Executive Officer of MPCA) or Priya Narayan (Co-Founder, Managing Partner & Chief Investment Officer of MPCA) from their respective active management roles. During the suspension period, BFO would have the right to elect to cease participation in future capital calls. In its first markup, the GP rejected this provision in its entirety, taking the position that the standard key person provisions set forth in Article 12 of the Fund IV Limited Partnership Agreement were sufficient and that granting LP-specific suspension rights would create operational complexity and could set an adverse precedent for other investors. In the second draft, Calderwood & Harkness narrowed the proposed suspension period from 90 days to 60 days as a compromise measure, while preserving the underlying structure of BFO's right to elect to cease future capital calls during the suspension window.
Discussion. Harrison Drummond opened the discussion on this point by stating that Meridian Peak, after internal deliberation among the fund's principals, would accept a 90-day suspension period — thereby reverting to BFO's original proposed position. Drummond noted that this concession was conditioned on the understanding that the key person suspension provision in the side letter would supplement, but would not replace, the standard key person event provisions contained in the Limited Partnership Agreement. In other words, the side letter right would operate as an additional protective mechanism available exclusively to BFO, running in parallel with the fund-wide key person provisions applicable to all limited partners under the LPA.
Tamara Fujimoto confirmed that this approach was acceptable to the fund sponsor. She noted that MPCA's primary concern had been ensuring that the side letter did not purport to modify or override the LPA's key person provisions, and that so long as the side letter clearly stated its supplementary nature, the GP was comfortable with the 90-day suspension window.
Pamela Cross confirmed that BFO's position had always been that the side letter provision was intended to be additive to the LPA protections, not a replacement, and that the next draft would make this explicit through appropriate cross-referencing language.
The parties confirmed that the trigger for the suspension would remain the departure of either Ellsworth or Narayan from their active management roles at MPCA, consistent with BFO's original proposal.
Outcome: AGREED. The key person suspension provision will provide for a 90-day suspension period upon the departure of either Conrad J. Ellsworth or Priya Narayan from active management roles at MPCA. The provision supplements but does not replace the standard key person provisions in the LPA. During the 90-day suspension period, BFO retains the right to elect to cease participation in future capital calls. Calderwood & Harkness to reflect this agreed position in the next draft of the side letter.
B. Most Favored Nation (MFN) — Anchor Investor Carve-Out (Section 2 of Draft Side Letter)
Background. The MFN provision, as currently drafted in Section 2 of the side letter, entitles BFO to elect to receive the benefit of any economic or governance term granted by the GP to any other limited partner committing $50 million or more to Fund IV, subject to certain enumerated exclusions. The principal exclusion at issue on the call relates to terms granted to "Anchor Investors," defined in the draft as limited partners committing $200 million or more to the Fund. At the target fund size of $1.5 billion, the $200 million Anchor Investor threshold represents approximately 13.33% of aggregate commitments. The remaining MFN exclusions — which cover (a) regulatory accommodations for ERISA-plan, tax-exempt, or governmental-plan investors, and (b) terms made available to GP affiliates and related persons — have been agreed and are not in dispute.
Discussion. Sandra Whitfield raised the question of whether the $200 million Anchor Investor threshold was a firm position on the part of Meridian Peak or whether the GP would consider lowering the threshold, noting that a lower threshold could potentially narrow the range of terms shielded from BFO's MFN election rights. Gavin Lockhart responded that the $200 million threshold is consistent across all Fund IV side letters and reflects a business determination by the GP that is not subject to modification. Lockhart noted that the threshold was established early in the fundraising process and has been applied uniformly to all investor negotiations. Harrison Drummond added that, in his experience, a threshold in the range of 10–15% of target fund size for the anchor investor carve-out is broadly consistent with current market practice for funds of comparable size and strategy, and that the $200 million figure falls squarely within that range.
Pamela Cross acknowledged BFO's position and stated that, having considered the GP's response and the market context, she agreed that the $200 million threshold is reasonable and that BFO would not press the point further.
Discussion of MFN Mechanics. Drummond also confirmed the procedural mechanics of the MFN provision. The GP will deliver a redacted summary of all material side-letter terms granted to other limited partners to BFO within 15 business days of the applicable closing at which BFO is admitted to the Fund. Upon receipt of the summary, BFO will have a period of 20 business days (the "MFN Election Period") to notify the GP of BFO's election to adopt any additional terms. These mechanics were consistent with the current draft language and were not in dispute. (Note: subsequent discussion regarding a potential revision to the GP's delivery period is addressed separately in Section III.J below.)
Outcome: AGREED. The Anchor Investor carve-out threshold is confirmed at $200 million. MFN election mechanics remain as previously drafted: 15 business days for the GP to deliver the redacted summary of side-letter terms following the applicable close; 20 business days for BFO to exercise its MFN election rights. No changes are needed in the next draft on this point, subject to the separate bracketed issue regarding the GP's delivery timeline discussed in Section III.J.
C. Excuse/Exclusion Rights Cap (Section 3 of Draft Side Letter)
Background. Section 3 of the draft side letter grants BFO the right to be excused from participation in investments involving the following categories:
(a) cannabis-related assets (including direct cultivation, processing, distribution, and ancillary cannabis businesses);
(b) gaming and casino properties (including gaming equipment manufacturers and operators of gaming establishments);
(c) investments in jurisdictions that are subject to comprehensive sanctions administered by the U.S. Department of the Treasury's Office of Foreign Assets Control ("OFAC") or otherwise subject to U.S. economic sanctions; and
(d) any investment that would cause BFO to be treated as holding "plan assets" under the Employee Retirement Income Security Act of 1974, as amended ("ERISA").
The exercise period for the excuse right is 15 business days from BFO's receipt of a capital call notice identifying a proposed investment falling within one of the excluded categories. The dispute between the parties concerns the aggregate cap on excused investments, expressed as a percentage of BFO's $75 million commitment. In its first markup, the GP proposed a cap of 15% of commitment ($75,000,000 × 15% = $11,250,000). Calderwood & Harkness counter-proposed a cap of 25% of commitment ($75,000,000 × 25% = $18,750,000) in the second draft, where the figure was presented in brackets to reflect the ongoing disagreement.
Discussion. Drummond stated that the GP has moved from its original 15% position and is now willing to accept a cap of 20% of BFO's commitment ($75,000,000 × 20% = $15,000,000). Fujimoto elaborated on the GP's rationale for the revised position, explaining that MPCA is concerned about the potential impact of excessive excuse rights on the GP's ability to deploy capital predictably and manage fund-level cash flow. She noted that a 20% cap represents a meaningful concession from the GP's 15% opening position and should be viewed in the context of the Fund's investment strategy, which may include a material number of transactions touching the cannabis and gaming sectors. Fujimoto further stated that the GP has reviewed its current pipeline and believes that investments in the cannabis-adjacent and gaming categories could constitute a meaningful portion of Fund IV's deployment activity, making it important for the GP to have reasonable certainty as to committed capital availability.
Whitfield responded that BFO's strong preference remains a 25% cap ($18,750,000). She emphasized that the breadth of the excluded categories — particularly the combination of cannabis-related assets and gaming/casino properties — increases the likelihood that a significant number of Fund IV investments could trigger BFO's excuse rights. Whitfield noted that if the GP's pipeline projections are correct and a substantial portion of Fund IV's capital is deployed in these sectors, a 20% cap could prove insufficient to protect BFO's policy-based restrictions.
Derek Calloway provided additional context, noting that BFO's investment policy committee has imposed a strict prohibition on cannabis and gaming exposure across all Briarwood portfolios, and that this prohibition is not a negotiable point for the Hargrove family. Calloway stated that BFO needs sufficient headroom under the excuse cap to ensure it can comply with its own internal investment guidelines without being forced to participate in prohibited investments or having its excuse rights exhausted prematurely.
Cross stated that BFO would take the 20% versus 25% question under advisement but would not concede the point on the call. She noted that this is a point on which BFO feels strongly and that additional internal deliberation would be required before BFO could accept the GP's revised position.
Outcome: NOT AGREED — REMAINS OPEN. The GP's position is a 20% cap on excused investments ($15,000,000). BFO's position is a 25% cap ($18,750,000). The next draft will reflect this as a bracketed point: [20%/25%]. Calderwood & Harkness recommends that BFO evaluate internally whether the 20% cap is acceptable or whether this is a point to be escalated in subsequent negotiations.
D. Co-Investment Rights (Section 5 of Draft Side Letter)
Background. BFO proposed a pro rata co-investment opportunity on all Fund IV transactions exceeding $100 million in equity. The co-investment would be offered at no management fee and no carried interest, with BFO's participation limited to its pro rata share based on its commitment relative to total fund commitments.
Discussion. Elaine Woodbury raised a process-related point regarding the timing of co-investment notices. She noted that the current draft did not specify the minimum notice period for co-investment opportunities and requested that the side letter include a provision requiring the GP to deliver co-investment notices to BFO at least 10 business days prior to the anticipated closing of the applicable co-investment transaction. Woodbury explained that this lead time is necessary to allow the GP to manage the closing process and coordinate with other co-investors.
Cross agreed that a defined notice period was reasonable and practical. She proposed reciprocal language requiring BFO to respond to any co-investment notice within 5 business days of receipt, thereby providing the GP with certainty as to BFO's participation in advance of the transaction closing. Lockhart confirmed that the $100 million equity threshold and the no-management-fee/no-carried-interest terms are acceptable to the GP and that MPCA views the co-investment framework as appropriately structured.
No other issues were raised with respect to co-investment rights. The parties were aligned on the substantive terms, and the only addition to the next draft will be the notice timing mechanics described above.
Outcome: SUBSTANTIALLY AGREED. Co-investment terms are accepted on the basis proposed in the second draft. A minor drafting point on notice timing will be incorporated in the next draft: the GP will provide co-investment notices at least 10 business days prior to the anticipated closing of the applicable transaction, and BFO will respond to such notices within 5 business days of receipt.
E. Enhanced Reporting (Section 6 of Draft Side Letter)
Discussion. The parties engaged in a brief discussion confirming the previously agreed enhanced reporting framework. The reporting obligations are as follows:
(a) Quarterly Portfolio-Level Reports: The GP will deliver quarterly portfolio-level performance reports to BFO within 45 days following the end of each fiscal quarter. Gavin Lockhart noted that Granite Ledger Fund Services LLC, the Fund's third-party fund administrator, will coordinate the preparation and distribution of the quarterly reports.
(b) Audited Annual Financial Statements: The GP will deliver audited annual financial statements for the Fund within 90 days following the end of each fiscal year. The audit will be conducted by Brockton Marsh & Associates LLP, the Fund's independent auditor.
(c) Annual ESG Reporting: The GP will provide an annual report on environmental, social, and governance ("ESG") matters relevant to the Fund's portfolio, in a format and with such detail as is consistent with MPCA's ESG reporting framework.
No material changes were proposed to the reporting provisions as set forth in the second draft, and all parties confirmed their agreement with the current language.
Outcome: AGREED. No changes needed in the next draft.
F. Management Fee Reduction (Section 4 of Draft Side Letter)
Discussion. The parties briefly confirmed that the negotiated management fee reduction, which was accepted by the GP in its first markup and has remained agreed since that time, is as follows:
•  During the Investment Period: 1.50% per annum on committed capital (reduced from the standard fee of 1.75% per annum, representing a 25 basis point reduction).
•  Post-Investment Period: 1.25% per annum on invested capital (reduced from the standard fee of 1.50% per annum, representing a 25 basis point reduction).
At the proposed $75 million commitment, the fee reduction generates annual savings of approximately $187,500 during the investment period (calculated as $75,000,000 × 0.25% = $187,500). Over a four-year investment period, the cumulative fee savings amount to approximately $750,000. No further discussion was required, and this provision remains fully agreed.
Outcome: AGREED. Already reflected in the current draft. No changes needed.
G. Placement Agent Fee Offset (Section 11 of Draft Side Letter)
Discussion. Drummond confirmed the GP's acceptance of a 100% offset of the placement agent fee payable to Pinnacle Capital Markets LLC against management fees otherwise payable by BFO. Pinnacle's fee on BFO's commitment is calculated as follows: $75,000,000 × 1.0% = $750,000. The offset will be applied pro rata against management fee installments as they become due, such that BFO's net management fee obligation is reduced dollar-for-dollar by the amount of the placement agent fee until the offset is fully absorbed. No open issues remain with respect to this provision.
Outcome: AGREED. Already reflected in the current draft. No changes needed.
H. Transfer Rights (Section 8 of Draft Side Letter)
Discussion. The parties briefly confirmed that BFO's right to transfer its limited partnership interest to any Hargrove family entity without the prior consent of the GP was accepted by the GP in principle during the prior round of negotiations. The transfer right is subject to compliance with applicable securities laws and relevant tax considerations, including but not limited to the avoidance of any transfer that would result in a termination of the Fund for U.S. federal income tax purposes.
Woodbury noted that Ashford Crane will add standard language in the next draft requiring BFO to provide reasonable documentation confirming the transferee's status as a Hargrove family entity. Woodbury indicated that this documentation requirement is consistent with the GP's approach in other side letters and is intended to ensure the GP can verify the family-entity relationship prior to recognizing the transfer on the Fund's books and records.
Cross confirmed that BFO has no objection to a reasonable documentation requirement and that Calderwood & Harkness will review the proposed language when circulated.
Outcome: AGREED, subject to minor drafting refinement regarding transferee documentation. Calderwood & Harkness to review and incorporate Ashford Crane's proposed language in the next draft.
I. Tax Reporting / K-1 Delivery (Section 10 of Draft Side Letter)
Background. BFO requested that the Fund use commercially reasonable efforts to deliver Schedule K-1s to BFO within 75 days of the end of each fiscal year, representing a meaningful acceleration from the standard 120-day delivery period provided in Article 14 of the Limited Partnership Agreement.
Discussion. Fujimoto stated that the GP's preference remains a 90-day delivery target. She explained that the complexity of the Fund's multi-jurisdictional investment structure and the need to coordinate the K-1 preparation process with both Brockton Marsh & Associates LLP (the Fund's auditor) and Granite Ledger Fund Services LLC (the Fund's administrator) make a 75-day timeline operationally challenging. Fujimoto acknowledged that the GP appreciates BFO's desire for expedited tax reporting but noted that a commitment to 75 days could require the Fund to incur additional costs for expedited tax preparation services and could result in the delivery of estimated or provisional K-1s, which may subsequently require amendment.
Whitfield responded that BFO's strong preference for the 75-day timeline is driven by the Hargrove family's tax planning needs. She noted that the family's personal tax advisors require early visibility into the Fund's tax attributes in order to prepare estimated tax payments and to coordinate with other investment vehicles in the family's portfolio. Whitfield stated that BFO considers this point important and would prefer not to concede to the 90-day timeline.
This point was not resolved on the call. Both parties maintained their respective positions.
Outcome: NOT AGREED — REMAINS OPEN. GP position: 90 days post fiscal year-end. BFO position: 75 days post fiscal year-end. To be reflected as a bracketed point [75/90 days] in the next draft.
J. MFN Summary Delivery Timing
Discussion. Late in the call, Drummond raised a point regarding the MFN mechanics previously discussed in Section III.B above. Specifically, Drummond stated that the GP's internal position is that 20 business days — rather than the 15 business days specified in the current draft — is the appropriate period for the GP to deliver the redacted summary of side-letter terms to BFO following the applicable closing at which BFO is admitted. Drummond explained that the GP needs additional time to compile, review, and redact the side-letter terms of all admitted limited partners, particularly in connection with a first close at which a large number of investors may be admitted simultaneously. He requested that this revision be reflected as an additional bracketed point in the next draft.
Cross noted that BFO's preference remains 15 business days, consistent with the current draft, in order to ensure that BFO has adequate time to review and exercise its MFN election rights within the overall timeline. Cross stated that BFO would consider the GP's request but was not prepared to agree on the call.
Outcome: NOT AGREED — REMAINS OPEN. GP position: 20 business days for delivery of the redacted MFN summary following the applicable close. BFO position: 15 business days. To be reflected as a bracketed point in the next draft.
K. Confidentiality Carve-Outs (Section 9 of Draft Side Letter)
Discussion. The parties briefly confirmed that the confidentiality carve-outs set forth in Section 9 of the draft side letter have been agreed. The agreed carve-outs permit BFO to disclose confidential information related to the Fund and the side letter to the following categories of recipients:
(a) BFO's tax, legal, and accounting advisors, to the extent reasonably necessary for the provision of professional services;
(b) members of the Hargrove family, including trustees and fiduciaries of Hargrove family trusts and estates; and
(c) regulatory authorities, to the extent required by applicable law or regulation.
No changes from the current draft were proposed, and no further discussion was required.
Outcome: AGREED. No changes needed in the next draft.
IV. SUMMARY OF OPEN POINTS REMAINING AFTER CALL
The following table summarizes the three remaining bracketed or open issues as of the conclusion of the March 11, 2024 call. All other provisions of the side letter are substantively agreed.
It should be noted that the parties reached agreement on all other substantive provisions of the side letter, including the key person suspension provision (Section 7), the MFN anchor investor threshold and election mechanics (Section 2, other than the delivery timing issue noted above), the co-investment rights framework (Section 5), the enhanced reporting obligations (Section 6), the management fee reduction (Section 4), the placement agent fee offset (Section 11), the transfer rights to Hargrove family entities (Section 8), and the confidentiality carve-outs (Section 9). These agreed provisions will be reflected in clean form in the next draft, with only the three items identified above remaining in brackets for further negotiation.
V. NEXT STEPS
The following next steps were identified on the call and through subsequent discussion among Calderwood & Harkness and BFO:
1.  Third Draft Side Letter. Calderwood & Harkness will prepare a third draft of the side letter incorporating all outcomes from the March 11 call. The three open points identified in Section IV above will be reflected in brackets. All agreed provisions will be updated to reflect the final agreed language, including the key person suspension reversion to 90 days, the co-investment notice timing mechanics, and the transfer documentation requirement.
2.  Target Circulation Date. Calderwood & Harkness's target date for circulation of the third draft to Ashford Crane & Hewitt LLP is March 14, 2024.
3.  BFO Pre-Circulation Review. Prior to transmittal to Ashford Crane, Calderwood & Harkness will circulate the third draft to Sandra M. Whitfield and Derek T. Calloway for review and comment.
4.  Internal BFO Deliberation on Excuse Cap. BFO is asked to consider internally whether the GP's revised 20% excuse/exclusion cap ($15,000,000) is acceptable, or whether BFO wishes to continue pressing for its 25% position ($18,750,000). Calderwood & Harkness's recommendation is to maintain the 25% position in the third draft with a potential fallback to 20% if needed to close the overall negotiation, provided that BFO's investment policy committee is comfortable with the 20% level of protection.
5.  BFO Investment Committee Approval. BFO's proposed commitment of $75 million to Fund IV remains subject to the approval of BFO's investment committee. Approval requires the affirmative vote of at least three of the four investment committee members, and Julian R. Hargrove holds a veto right over any commitment. No side letter or subscription agreement may be executed prior to receipt of investment committee approval. The next investment committee meeting is anticipated for late March 2024.
6.  Fund IV Closing Timeline. Fund IV's anticipated first close is April 30, 2024. The final close deadline under the LPA is October 31, 2024. BFO's target is to complete all documentation in advance of the first close, subject to investment committee approval.
VI. DISTRIBUTION AND PRIVILEGE NOTICE
This memorandum was prepared by Theresa Kim, Lead Associate, Calderwood & Harkness LLP, and reviewed by Pamela Cross, Partner, Calderwood & Harkness LLP. Distribution of this memorandum is limited to the named addressees. This memorandum is protected by the attorney-client privilege and constitutes attorney work product. It should not be forwarded, copied, or disclosed to any third party without the prior written consent of Calderwood & Harkness LLP.
A file copy of this memorandum has been saved to the Calderwood & Harkness LLP document management system under Matter No. 1026-00001.
Contact Information:
Theresa Kim Calderwood & Harkness LLP 425 Lexington Avenue New York, NY 10017
PRIVILEGED & CONFIDENTIAL — ATTORNEY-CLIENT COMMUNICATION — ATTORNEY WORK PRODUCT This memorandum is intended solely for the use of the named addressees and contains information that is privileged, confidential, and exempt from disclosure under applicable law. If you are not an intended recipient, please notify the sender immediately and destroy all copies of this document.
No. | Issue | GP Position | BFO Position | Status
1 | Excuse/Exclusion Cap (§3) | 20% of commitment ($15,000,000) | 25% of commitment ($18,750,000) | Open — bracketed
2 | MFN Summary Delivery Timing (§2) | 20 business days post-close | 15 business days post-close | Open — bracketed
3 | K-1 Delivery Timeline (§10) | 90 days post fiscal year-end | 75 days post fiscal year-end | Open — bracketed