Cortec’s Business
A. Cortec and its Principal Owners
Cortec is a New York limited liability company and has its principal place of business in New York,
New York. R. Scott Schafler, Neal A. Kayes and Gerald Rosenberg established Cortec Group, Inc. (now
“Cortec Group Management Services, LLC”), Cortec’s predecessor, in 1984. Cortec was formed in
2008 by R. Scott Schafler. Jeffrey A. Lipsitz and David L. Schnadig serve as principal owners and
Cortec members along with Michael E. Najjar, Jonathan A. Stein, Jeffrey R. Shannon, Douglas R. Kruep,
James W. Tucker, and Robert W. Whipple whom serve as Cortec’s Members and owners. In 2018, a
less than 20% indirect passive interest was sold to a limited partner.
B. Advisory Services
All descriptions of the Cortec Clients in this Brochure, including, but not limited to, their investments,
the strategies used in managing those entities, the fees and other costs associated with an investment in
those entities, and conflicts of interest faced by Cortec in connection with management of those entities
are qualified in their entirety by reference to the Cortec Funds Documentation.
Cortec provides discretionary advisory services to the Cortec Clients (based on the particular
investment objectives and strategies described in the applicable Cortec Funds Documentation and
side letters entered into between Cortec on behalf of the Cortec Funds and Cortec Fund investors).
The Cortec Clients seek to make (and/or have made) controlling acquisitions of companies with
purchase prices generally ranging from $40 to $700 million. Those funds focus on investing in
established designers, marketers, manufacturers and distributors of medical, consumer, building and
other value-added products, as well as specialty distribution and service businesses (as described
further in Item 8 below). The Cortec Clients (and their respective general partners and managers)
are as follows:
• Cortec Fund V, a Delaware limited partnership (its managing general partner is Cortec
Management V, L.L.C. and its investment general partner is Cortec Investment V, L.L.C.);
• Cortec Co-Investment V, a Delaware limited partnership (its manager is Cortec Group GP,
LLC);
• Cortec Fund VI, a Delaware limited partnership (its managing general partner is Cortec
Management VI, L.L.C. and its investment general partner is Cortec Investment VI, L.L.C.);
• Cortec Fund VI-A, a Delaware limited partnership (its managing general partner is Cortec
Management VI, L.L.C. and its investment general partner is Cortec Investment VI, L.L.C.); and
• Cortec Co-Investment VI, a Delaware limited partnership (its managers are Cortec Group GP,
LLC).
• Cortec Fund VII, a Delaware limited partnership (its general partner is Cortec Investment VII,
L.L.C.);
• Cortec Fund VII-A, a Delaware limited partnership (its general partner is Cortec Investment
VII, L.L.C.); and
• Cortec Co-Investment VII, a Delaware limited partnership (its manager is Cortec Group GP,
LLC).
• Cortec Fund VIII, a Delaware limited partnership (its general partner is Cortec Investment
VIII, L.L.C.);
• Cortec Fund VIII-A, a Delaware limited partnership (its general partner is Cortec Investment
VIII, L.L.C.); and
• Cortec Co-Investment VIII, a Delaware limited partnership (its manager is Cortec Group GP,
LLC).
The general partners of the Cortec Funds are wholly-owned affiliates of Cortec. The managing
members of the Employee Co-Investment Vehicles are Cortec’s Members. The Employee Co-
Investment Vehicles
were formed solely to co-invest in a fixed percentage of each portfolio
investment alongside their respective Cortec Funds (at the same time, on the same terms and
conditions and based on a pre-determined participation percentage), and the investors in these
vehicles are generally Cortec personnel and former personnel, their family members and/or entities
formed for the benefit of those persons. Cortec Fund VI-A was formed to allow tax sensitive investors
to participate in each portfolio company alongside Cortec Fund VI and Cortec Co-Investment VI.
Cortec Fund VII-A was formed to allow tax sensitive investors to participate in each portfolio
company alongside Cortec Fund VII and Cortec Co-Investment VII. Cortec Fund VIII-A was formed to
allow tax sensitive investors to participate in each portfolio company alongside Cortec Fund VIII and
Cortec Co-Investment VIII.
As supervised persons of Cortec, the Cortec General Partners listed above intend to conduct their
activities in accordance with the Advisers Act and the rules thereunder. Any employees of the Cortec
General Partners and any other persons acting on their behalf are and shall be subject to the
supervision and control of Cortec. The Cortec General Partners are relying on Cortec’s registration
under the Advisers Act and are not registering themselves. Unless otherwise provided, references to
“Cortec” in this Brochure will include Cortec and the Cortec General Partners collectively.
C. Tailoring of Advisory Services
Cortec’s investment decisions and advice are subject to each Cortec Client’s investment objectives
and guidelines, as set forth in the relevant Cortec Funds Documentation. Guidelines include the
amount of fund assets that may be invested in any single portfolio company, the amount of fund
assets that may be invested in companies over which the fund does not have control and the
geographies in which a fund may invest, among others.
In addition, subject to the terms of the Cortec Funds Documentation, as described below, Cortec has,
and may in the future, enter into agreements, such as side letters, with certain Cortec Fund limited
partners (without the approval of any other limited partners). Side letters may be granted to
incentivize or permit limited partners to invest with Cortec, invest certain amounts or invest with
Cortec in the future. The side letters or other similar agreements have the effect of establishing rights
under, altering or supplementing the terms of the relevant Cortec Funds Documentation with respect
to one or more such limited partners in a manner that could be more favorable to such limited
partners than those applicable to other limited partners. For example, the side letters or other
similar agreements may:
• impose restrictions on a Cortec Fund’s investments;
• reduce carried interest incurred by a limited partner;
• provide additional information or reports to a limited partner;
• provide more favorable transfer rights.
Notwithstanding the above, the Cortec Funds Documentation generally requires that the relevant
Cortec General Partner offer the same rights and benefits provided to one limited partner to each of
the other limited partners (subject to certain carve-outs for Cortec Fund V, Cortec Fund VI, Cortec
Fund VI-A, Cortec Fund VII, Cortec Fund VII-A, Cortec Fund VIII, and Cortec Fund VIII-A).
D. Wrap Fee Programs
Cortec does not participate in wrap fee programs.
E. Assets Under Management
As of December 31, 2023, Cortec managed $6,901,258,027 on a discretionary basis. Cortec does not
manage any assets on a non-discretionary basis.