spv administration

Scope of Services: SPV Administration

Per annum pricing includes administration services by Carta. Pricing will be determined based on your individual SPV structure, needs, and complexities.

I. Accounting Services

Accounting services are supported for USD-denominated entities only.

US GAAP Reporting

The following statements will be produced via the Carta platform:

• Balance Sheet
• Statement of Operations
• Schedule of Investments (SOI)
• Statement of Changes
• Partners’ Capital Account Statements (PCAPs)

The following performance metrics will be available on the Carta platform: Net IRR, Gross Deal Level IRR, RVPI, TVPI, DPI and MOIC.

You can view a sample of the Carta system-generated external financial reporting package here.

Books and Records

Carta will update and maintain the accounting books and records for the SPV. You will have easy, read-only access to review the books and records.

For the SPV, Carta will:

• Maintain and update the Schedule of Investments (SOI) on the Carta platform
• Maintain total capital called and distributions received for indirect investments
• Update valuations at quarter-end or at a material financing

Necessary documents or information you will share with Carta:

• Required documents and information from the Implementation Checklist
• Fully executed closing set for portfolio company investments (e.g., countersigned purchase agreement, articles of incorporation (AOI) / certificate of formation)
• Fully executed subscription packets for Fund of Fund investments
• Submit price per share and/or ending fair market value of SPV-specific holdings at least 15 business days prior to reporting deadline in accordance with the SPV’s valuation policy (requires finalized supporting documentation consistent with industry standards).
• PCAPs for underlying Fund of Fund investments - Client is responsible for retrieving any fund investment related documents from external sources/third parties, including but not limited to investors’ capital account statements, capital call notices, distribution notices, and financial statements.
• Complete dissolution of the business at end of life of the applicable entities, after final distribution

Banking and Payments

Carta will:

• Provide annual cash reconciliation
• Set up electronic payments for all cash activity as requested
• Confirm all fund expenses (including management fee calculations) are done in accordance with the operating agreement(s)
• Manage Form 1099 process electronically at year-end as approved, including filing with IRS on client’s behalf

You will provide Carta:

• Access to the SPV's bank account as required, with the ability to set up payments (bank must have two step-authorization capability and account must be in the SPV's name)
• Vendor W-9s and email contact prior to initial payment
• Wire or other payment instructions, invoices for expenses, and executed purchase documents for investments

You are responsible for:

• Setting up bank accounts, one for each Carta administered entity, with your chosen banking partner as approved by Carta
• Final review and releasing of payments after you receive confirmation from Carta
• Performing any call backs to your vendor
• Ensuring accurate user profile setup within the Carta platform
• Establishing authorized access to your bank account
• Resolving any failed, rejected, returned, or on hold payments due to additional information or documentation needed by your banking partner

These services are subject to the Venture Capital Payment Terms and Conditions located at https://carta.com/legal/agreements/venture-capital-payment-terms-conditions/.

Year-End Filings

You will:

• Complete any municipal, state, foreign, or federal reporting or regulatory filings. Such filings or reporting will not be completed by Carta

Carta will not be responsible for any SSBCI-related activities, including but not limited to any SSBCI-specific reporting requirement, custom chart of accounts or custom reporting. Client will handle all SSBCI-specific reporting requirements and filings with the applicable states.

Tax Support

Carta will:

• Provide books, records, and supporting documentation to your tax preparer
• Distribute K-1s generated your tax provider through the Carta platform

You will:

• Coordinate execution of the tax engagement letter (by September 30 of each year) and tax returns, with executed copies to Carta as applicable
• Manage relationship with tax preparer, including answering ongoing questions and requests from your tax preparer

To further streamline your SPV administration, Carta offers SPV tax preparation services for an additional price. Learn more here.

Audit Support

Audit support is subject to an additional charge.

If you choose to have an audited SPV, Carta will:

• Provide books, records, and supporting documentation to your auditor
• Complete template for audit confirms; auditor to send and collect from various parties (portfolio companies, banks, legal counsel, etc.)
• Complete audit notes and financial statements in the Carta platform. You can view a sample of the audited financial reporting package here.
• Distribute audit report generated by your auditor through the Carta platform

You will:

• Coordinate execution of the audit engagement letter (by September 30 of each year), audit representation letter, audit confirms, etc. with executed copies to Carta as applicable
• Manage relationship with auditor, including completion of audit notes and ongoing questions and requests from the audit team
• Complete and deliver audit reports in a timely manner
• Collect AOIs, financials, and other valuation support for portfolio companies
• Provide industry and geography details as well as updated contact info for all portfolio holdings
• Provide SPV’s valuation policy and valuation support to substantiate any discretionary valuation adjustments or approaches consistent with industry standards
• Collect capitalization tables and annual financial statements for portfolio companies

II. Administration Services

Capital Calls

Carta will:

• Add new investors to the Carta platform and issue the initial capital call notice upon your execution of the subscription agreement
• Execute on your post initial capital call requests the same business day if received prior to 3pm EST

The following are available via the Carta platform:

• Per-investor calculations, preparation, and distributions of capital notice to investors
• Tracking receipts of capital contribution payments
• Follow-ups to investors (at your discretion) 24 hours after the capital call due date

You will:

• Submit and approve capital call requests through the Carta platform
• Provide potential investments and realizations for cash projections
• Provide the percentage or dollar amount to be called and any other required information
• Notify Carta of commitment or carry percentage changes by member

Cash Distributions

Carta will:

• Perform waterfall calculations in accord with the operating agreement(s)
• Send notifications to investors to update their wire instructions on the Carta platform
• Complete and coordinate potential tax distributions
• Draft and publish distribution notices on the Carta platform
• Set up distribution wires in your bank account as approved

You will:

• Provide amounts to be distributed and final sign-off on calculations
• Follow-up with investors to confirm wire instructions beyond two failed attempts

Stock Distributions

Carta will:

• Perform waterfall calculations in accord with the operating agreement(s)
• Draft and publish distribution notices on the Carta platform
• Provide allocation of shares to Client’s third-party brokerages to facilitate distributions

You will:

• Provide number of shares to be distributed and final sign-off on calculations
• Collect DTC instructions from investors and coordinate with your selected third-party brokerage firm

Investor Information

Investors will be responsible for updating their information, including maintaining investor contact preferences, wire instructions, W-9s/W-8BENs, and other requested information on the Carta platform. Contact your Carta representative to engage separate AML/KYC services for an additional fee.

All communications will be on the Carta platform, which will serve as the communication repository for communications like capital calls, distributions, quarterly and annual reports, investor update letters, tax documents, etc.

Carta will assist with providing you answers to investor questions related to SPV information on the Carta platform. Carta will not communicate with investors directly.

You will provide:

• Fully executed Operating Agreements with list of commitments and carry percentage by member
• Fully executed subscription packets
• Fully executed side letters (if applicable)
• Investor W-8s, W-9s, and up to date contact information
• Information about disregarded entities

Dissolutions

You are responsible for dissolution of the SPV at the end of its life.