Contract analysis

From: "Eric Johannsen" To: "Rachel Moynihan" Cc: "Jonathan Pritchett" Date: Tue, 12 Sep 2023 04:37:00 -0000 Subject: Arbor Health Technologies Inc. — IPO Organizational Meeting — Agenda and Materials for September 15, 2023

I hope this finds you all well. I am writing to circulate the agenda and advance materials for the organizational meeting for the proposed initial public offering of common stock of Arbor Health Technologies Inc. on the New York Stock Exchange. As you know, the engagement was formally opened on August 21, 2023, and we are pleased to be moving forward with the kick-off.

The organizational meeting is confirmed for **Friday, September 15, 2023, at 10:00 AM ET**, and will be held in person at Calderwood & Harkness's offices at 125 Broad Street, New York, NY 10004. For those unable to attend in person, we will provide a dial-in and videoconference option — I will circulate those details separately. Theodore Langston will chair the meeting.

By way of brief background for the full working group, Arbor Health Technologies is a healthcare services and SaaS company headquartered in Cambridge, Massachusetts, with approximately 3,400 employees, serving over 1,200 hospital systems across 42 states. The company's financial profile is strong — FY2023 revenue of $612.4 million, reflecting approximately 28% year-over-year growth — and the working group believes th

We expect the following individuals to attend the organizational meeting. Please confirm your attendance and let me know if there are additional attendees from your respective teams who should be included:

*Arbor Health Technologies Inc. (Issuer):* - Dr. Nathaniel Rourke, Co-Founder, Chairman & CEO - David Halderman, CFO - Rachel Moynihan, General Counsel & Corporate Secretary - Margaret "Meg" Tsujimoto, Co-Founder & CTO (for technology/platform discussion)

*Whitfield Barrow & Co. (Lead Left Bookrunner):* - Jonathan Pritchett, Managing Director, ECM - Sarah Langley-Kwan, Director, Healthcare ECM

*Calloway Pierce Securities (Joint Bookrunner):* - Marcus Delgado, Managing Director, Healthcare IB - Anita Pham, Vice President, ECM Syndicate

*Velthorn Capital Partners (Joint Bookrunner):* - Robert Acheson, Managing Director, Tech & Healthcare ECM

*Pemberton Wallis (Co-Manager):* - Elena Vasquez, Director, ECM

*Calderwood & Harkness LLP (Issuer's Counsel):* - Theodore Langston, Responsible Partner, Capital Markets - Vivienne St. Claire, Partner, Capital Markets - Eric Johannsen, Lead Associate - Claire Dempsey, Associate - Sylvia Hartwell, Partner, Tax (for tax workstream discussion)

*Meridian Hale & Quivorn LLP (Underwriters' Counsel):* - Graham Neville, Lead Partner - Kathryn Brennan, Senior Associate

*Kellerman & Associates LLP (Independent Auditors):* - Richard Olander, Lead Engagement Partner - Sonia Melendez, Audit Senior Manager

Additionally, representatives of Brindoval Trelvon Partners (Leonard Corbett and/or Diana Coltrane) and Ridgeline Growth Equity (Howard Feng) have been invited separately and will confirm their attendance directly.

Please find attached the following three documents for advance review ahead of Friday's meeting:

1. **Organizational Meeting Agenda** — a detailed agenda covering all topics to be addressed, including transaction overview, registration statement workstreams, due diligence planning, corporate governance and restructuring matters, tax, and next steps. 2. **Proposed IPO Timeline** — an indicative milestone schedule from engagement opening through closing and lock-up expiration. 3. **Responsibility Matrix** — a draf

These materials are in draft form, and we welcome input from all members of the working group. Please review them in advance and come prepared with any questions, additions, or suggested revisions.

I would appreciate it if each party could (i) confirm attendance and (ii) identify any additional attendees by **end of day Wednesday, September 13**. A separate calendar invitation will follow. The agenda may be supplemented based on input received from the working group prior to Friday.

Hard copies of all materials will be available at the meeting. If you have any logistics questions in the meantime, please do not hesitate to reach out to me directly.

Thank you, and we look forward to a productive meeting on Friday.

Eric Johannsen Calderwood & Harkness LLP 125 Broad Street New York, NY 10004 Direct: (212) 558-3742 Mobile: (917) 604-8819 ejohannsen@calderwoodharkness.com

**ARBOR HEALTH TECHNOLOGIES INC.** **Proposed Initial Public Offering of Common Stock** **Organizational Meeting Agenda** **September 15, 2023, 10:00 AM ET** **Calderwood & Harkness LLP, 125 Broad Street, New York, NY 10004**

- Introductions of all working group members - Confirmation of roles: - **Arbor Health Technologies Inc.** — Issuer (Delaware corporation, headquartered at 275 Kendall Avenue, Suite 1400, Cambridge, MA 02142) - **Whitfield Barrow & Co.** — Lead left bookrunner and representative of the underwriters - **Calloway Pierce Securities** — Joint bookrunner - **Velthorn Capital Partners** — Joint bookrunner - **Pemberton Wal

**II. Transaction Overview and Offering Structure**

- **Proposed Offering:** Initial public offering of shares of common stock, par value $0.001 per share, on the New York Stock Exchange - **Offering Type:** All-primary offering; no secondary sales by existing stockholders are anticipated at this time - **Anticipated Offering Size:** To be determined closer to filing; currently estimated at approximately $400 million base deal - **Overallotment Option:** Standard 15%

| Stockholder | Shares | % of Outstanding | |---|---|---| | Brindoval Trelvon Partners Fund IV, L.P. | 28,000,000 | 35.0% | | Ridgeline Growth Equity Fund III, LLC | 16,000,000 | 20.0% | | Dr. Nathaniel Rourke (Co-Founder, CEO) | 12,800,000 | 16.0% | | Margaret Tsujimoto (Co-Founder, CTO) | 9,600,000 | 12.0% | | David Halderman (CFO) | 2,400,000 | 3.0% | | Rachel Moynihan (GC) | 1,200,000 | 1.5% | | Dr. Priya Subrama

- **Listing Venue:** New York Stock Exchange - **Proposed Ticker Symbol:** ARHT - **Use of Proceeds Discussion:** - Repayment of approximately $65 million outstanding on the Keypoint National Bank revolving credit facility - Product development and R&D investment - Potential acquisitions - General corporate purposes

**III. Registration Statement Workstreams and Drafting Plan**

- **Form:** S-1 registration statement under the Securities Act of 1933, as amended - **Strategy:** Confidential submission to the SEC under the JOBS Act (emerging growth company analysis to be conducted; if AHT does not qualify, confidential submission process under the applicable SEC rules), followed by public filing - **Key S-1 Sections and Drafting Responsibilities:**

| Section | Lead Drafter | Key Contributors | |---|---|---| | Business Description | C&H | AHT management (Halderman, Moynihan, Tsujimoto) to provide initial narrative | | Risk Factors | C&H | AHT management, Whitfield Barrow, Meridian Hale | | Use of Proceeds | C&H | Halderman, Whitfield Barrow | | Capitalization and Dilution Tables | C&H | Kellerman | | MD&A | Kellerman / AHT Finance | C&H (review) | | Management a

- **Target for First Draft S-1 Circulation:** October 2, 2023 - C&H to maintain an internal S-1 disclosure checklist (Regulation S-K items) throughout the process

- Walk-through of the proposed indicative timeline (see Attachment 2) - Key milestones to emphasize: - Confidential submission target: mid-November 2023 - Public filing target: January 2024 - Pricing target: February 2024 - Discussion of dependencies and critical path items

- **Business Due Diligence Sessions:** To be scheduled with AHT management (Dr. Rourke, Ms. Tsujimoto, Mr. Halderman, Dr. Subramanian) covering the following key topics: - Platform technology and product roadmap - Customer concentration and key customer relationships - Revenue recognition policies and metrics - Regulatory environment (HIPAA, state regulations, FDA considerations if applicable) - Cybersecurity and dat

**VI. Corporate Governance and Pre-IPO Restructuring**

- **Amended and Restated Certificate of Incorporation** — to be filed at closing: - Authorize expanded share capital: 400,000,000 shares of common stock; 50,000,000 shares of preferred stock ("blank check") - Anti-takeover provisions: - No stockholder action by written consent - Supermajority vote required to amend bylaws - Advance notice provisions for stockholder proposals - Section 203 of the DGCL (business combin

- **Amended and Restated Investors' Rights Agreement** (dated October 22, 2020): - Terminates upon a Qualified IPO (defined as >$200 million in gross proceeds on a national securities exchange) - **Amended and Restated Voting Agreement:** - Terminates upon IPO - **Registration Rights Agreement** — to be amended and restated effective upon IPO: - Demand registration rights: 2 demands for Brindoval Trelvon Partners and

**VIII. Underwriting Agreement Framework**

- Whitfield Barrow (as Representative) to prepare initial draft of the underwriting agreement - C&H to review and negotiate on behalf of the issuer; Meridian Hale to represent the underwriters - Key negotiation topics to be flagged: - Scope of indemnification provisions - Qualification of representations and warranties - Conditions precedent to closing - Termination triggers (market-out, force majeure) - Lock-up rele

- **Existing Facility:** $150 million senior secured revolving credit facility with Keypoint National Bank, N.A. (as Administrative Agent) and Stonemill Capital Bank (syndicate member) - Entered: March 15, 2022 - Maturity: March 15, 2027 - Interest rate: SOFR + 200 bps - Currently drawn: approximately $65 million - **Amendment Required Prior to IPO:** - Change of control definition — exclude IPO from triggering event

- IPO D&O insurance program to be placed prior to effectiveness of the Registration Statement - Discussion of target tower size and carrier selection (primary and excess layers) - C&H to review policy terms and conditions once a binder is in place

- Sylvia Hartwell (C&H Tax) to prepare the following: - **Section 382 Ownership Change Analysis:** Impact of the IPO on net operating losses and R&D credit carryforwards (AHT has $12.4 million in cumulative R&D credit carryforward) - **Equity Compensation Tax Memorandum:** Section 409A compliance, Section 83(b) elections (14 employees), ISO/NQSO treatment, Section 162(m) deductibility limitations, ESPP Section 423 qu

- Toppan Quillon Health IT engaged as financial printer and EDGAR filing agent - Coordination on typesetting, EDGAR conversion (XBRL/iXBRL tagging), and filing logistics - Blue sky survey to be prepared

- Continental Share Services, Inc. confirmed as transfer agent and registrar - DTC eligibility to be confirmed prior to closing

| Action Item | Responsible Party | Target Date | |---|---|---| | Distribute D&O questionnaires to all directors and officers | C&H (Dempsey) | Week of September 18 | | Schedule business due diligence sessions | Whitfield Barrow / C&H | Last two weeks of September | | AHT management to provide business description narrative, customer data, and key metrics | AHT (Halderman, Moynihan, Tsujimoto) | September 25, 2023 |

**ARBOR HEALTH TECHNOLOGIES INC.** **Proposed Initial Public Offering** **Indicative Timeline** **(DRAFT — Subject to Change)**

| Target Date | Milestone | Lead Responsible Party | |---|---|---| | August 21, 2023 | Engagement opened; Calderwood & Harkness retained as issuer's counsel | C&H / AHT | | September 15, 2023 | Organizational meeting (all-hands kick-off) | All parties | | Week of September 18, 2023 | D&O questionnaires distributed to directors and officers | C&H | | Late September 2023 | Business due diligence sessions with AHT manag

*Note: This timeline is indicative and subject to SEC review timing, market conditions, and working group progress. All dates are targets only.*

**ARBOR HEALTH TECHNOLOGIES INC.** **IPO Responsibility Matrix** **(DRAFT)**

| # | Workstream | Lead Responsible Party | Supporting Parties | Target Completion | |---|---|---|---|---| | 1 | S-1 Drafting — Business Section | C&H (Johannsen / Dempsey) | AHT management (Halderman, Moynihan, Tsujimoto) | First draft Oct. 2, 2023 | | 2 | S-1 Drafting — Risk Factors | C&H (Johannsen) | AHT, WB, Meridian Hale | First draft Oct. 2, 2023 | | 3 | S-1 Drafting — MD&A | AHT (Halderman) / Kellerman | C&H

*This matrix is a working draft and will be updated as the process progresses. Please direct any questions or suggested revisions to Eric Johannsen at ejohannsen@calderwoodharkness.com.*