Contract analysis

I. Executive Summary This memorandum analyzes whether Arbor Health Technologies Inc. ("AHT" or the "Company"), a Delaware corporation headquartered at 275 Kendall Avenue, Suite 1400, Cambridge, Massachusetts 02142, satisfies the quantitative and qualitative listing standards of the New York Stock Exchange (the "NYSE") for the listing of its common stock, par value $0.001 per share, under the proposed ticker symbol "A

II. Applicable Listing Standards Framework The NYSE Listed Company Manual establishes both quantitative and qualitative requirements that a company must satisfy in order to list its securities on the NYSE. The relevant standards for purposes of AHT's proposed listing are set forth in Sections 102.01A through 102.01C (quantitative initial listing standards) and Sections 303A.00 through 303A.14 (corporate governance st

III. Quantitative Listing Standards Analysis A. Distribution Standards (Section 102.01A)

Section 102.01A of the Manual establishes the minimum distribution standards that must be satisfied in connection with an original listing. The following subsections analyze AHT's compliance with each applicable distribution criterion.

1. Minimum Number of Round Lot Holders NYSE Requirement. Section 102.01A requires that a company listing its common stock on the NYSE have at least 400 holders of 100 shares or more (commonly referred to as "round lot holders"). This requirement is designed to ensure that the listed security has a sufficient base of public shareholders to support an active and liquid trading market. Analysis. AHT's IPO consists of a

2. Minimum Number of Publicly Held Shares NYSE Requirement. Section 102.01A requires that there be at least 1,100,000 shares held in the public float at the time of listing. For purposes of this calculation, "publicly held shares" are determined by subtracting from the total shares outstanding all shares held by directors, officers, or their immediate families, as well as all other concentrated holdings of 10% or mor

3. Aggregate Market Value of Publicly Held Shares NYSE Requirement. Section 102.01A requires that the aggregate market value of publicly held shares be at least $40,000,000 for a company listing in connection with an IPO. Analysis. Based on the public offering price of $20.00 per share and 23,000,000 shares in the public float (assuming full exercise of the overallotment option), the aggregate market value of publicl

Section 102.01C of the Manual establishes the financial standards that must be satisfied for an original listing. AHT expects to qualify under the Earnings Test (Standard I) or, alternatively, under the Market Capitalization/Revenue Test (Standard IV). Each is analyzed below.

1. Earnings Test (Standard I) NYSE Requirement. Standard I of Section 102.01C requires that a company demonstrate aggregate pre-tax earnings from continuing operations of at least $10,000,000 over the three most recent fiscal years, with a minimum of $2,000,000 in pre-tax earnings in each of the two most recent fiscal years, and positive pre-tax earnings in all three fiscal years. Analysis. Based on the financial inf

2. Alternative: Market Capitalization / Revenue Test (Standard IV) NYSE Requirement. Standard IV of Section 102.01C provides an alternative financial standard requiring (a) global market capitalization of at least $200,000,000 and (b) revenue of at least $100,000,000 in the most recently completed fiscal year. Analysis. AHT expects to satisfy both elements of Standard IV by a wide margin: Global Market Capitalization

3. Minimum IPO Price NYSE Requirement. Section 102.01C requires that the price per share at the time of listing be at least $4.00. Analysis. The IPO price of $20.00 per share exceeds the $4.00 minimum by a factor of 5 times. The initially filed price range was $17.00 to $19.00 per share; the revised range is $18.00 to $20.00 per share. All price points within both the initial and revised filing ranges significantly e

IV. Corporate Governance Standards — Section 303A Analysis

Section 303A of the Manual establishes the corporate governance requirements applicable to NYSE-listed domestic companies. This section analyzes AHT's compliance with each applicable requirement, beginning with the threshold controlled company exception analysis. A. Controlled Company Exception Analysis (Section 303A.00)

1. The Controlled Company Standard

Section 303A.00 of the Manual provides that a "controlled company" — defined as a company of which more than 50% of the voting power for the election of directors is held by an individual, a group, or another company — is exempt from certain independence requirements that would otherwise apply. Specifically, a controlled company is exempt from: (a) the requirement for a majority independent board (Section 303A.01); (

2. Post-IPO Ownership Analysis Following the consummation of the IPO and the full exercise of the overallotment option, the post-IPO ownership of AHT's common stock will be as follows: No single stockholder will hold more than 50% of the voting power following the IPO. Brindoval Summit, as the largest single stockholder, will hold approximately 27.18% of the outstanding common stock, well below the 50% threshold. Eve

3. Analysis of Whether a "Group" Exists The determination of whether multiple stockholders constitute a "group" for purposes of the controlled company exception is a facts-and-circumstances analysis. Relevant factors include (a) the existence of voting agreements or arrangements among the stockholders, (b) the existence of board designation rights or observer rights that effectively coordinate the stockholders' influ

4. Conclusion on Controlled Company Status Based on the foregoing analysis, we conclude that AHT is not expected to qualify as a controlled company under Section 303A.00 of the Manual following the consummation of the IPO. No single stockholder will hold more than 50% of the voting power, and the principal stockholders are not expected to constitute a "group" within the meaning of the controlled company test. The Vot

Section 303A.01 of the Manual requires that a majority of the directors of a NYSE-listed company be independent. Under Section 303A.02, a director qualifies as independent only if the board of directors affirmatively determines that the director has no material relationship with the listed company, either directly or as a partner, stockholder, or officer of an organization that has a relationship with the company. Se

2. Post-IPO Board Composition Following the IPO, AHT's board of directors will consist of seven directors. The following is our preliminary assessment of the independence of each director:

1. Dr. Nathaniel Rourke — Chairman and Chief Executive Officer. Dr. Rourke is the co-founder of AHT and serves as the Company's Chairman of the Board and Chief Executive Officer. As a current executive officer of the Company, Dr. Rourke is categorically disqualified from independence under Section 303A.02(b)(i). Classification: Not Independent.

2. Margaret Tsujimoto — Co-Founder and Chief Technology Officer. Ms. Tsujimoto is the co-founder of AHT and serves as the Company's Chief Technology Officer. As a current executive officer of the Company, Ms. Tsujimoto is categorically disqualified from independence under Section 303A.02(b)(i). Classification: Not Independent.

3. Leonard Corbett — Managing Partner, Brindoval Trelvon Partners. Mr. Corbett serves as a director of AHT as a designee of Brindoval Trelvon Partners Fund IV, L.P., which will hold approximately 27.18% of the Company's outstanding common stock following the IPO. Under NYSE rules, the mere fact that a director was designated by, or represents the interests of, a significant stockholder does not, in and of itself, pre

4. Diana Coltrane — Partner, Brindoval Trelvon Partners. Ms. Coltrane serves as a director of AHT as a second designee of Brindoval Trelvon Partners Fund IV, L.P. The same analysis applicable to Mr. Corbett applies to Ms. Coltrane. Her independence depends on whether she has any material relationship with AHT beyond her role as a Brindoval Summit designee, and on whether Brindoval Summit or its affiliates have materi

5. Howard Feng — Managing Director, Ridgeline Growth Equity. Mr. Feng serves as a director of AHT as a designee of Ridgeline Growth Equity Fund III, LLC, which will hold approximately 15.53% of the Company's outstanding common stock following the IPO. As with Mr. Corbett and Ms. Coltrane, the mere fact of stockholder designation does not preclude independence, but Mr. Feng's independence must be assessed in light of

6. Carolyn Whittemore — Independent Director. Ms. Whittemore has no current or recent employment relationship with AHT, has not received compensation from AHT other than standard director and committee fees, and has no material relationship with AHT, its management, or its major stockholders, based on our review of her D&O questionnaire responses. No categorical disqualification applies. Classification: Independent.

7. Dr. Samuel Obadina — Independent Director. Dr. Obadina has no current or recent employment relationship with AHT, has not received compensation from AHT other than standard director and committee fees, and has no material relationship with AHT, its management, or its major stockholders, based on our review of his D&O questionnaire responses. No categorical disqualification applies. Classification: Independent.

3. Assessment of Majority Independence Requirement Under Section 303A.01, at least four of the seven directors must be independent in order to achieve a majority independent board. Currently, two directors (Whittemore and Obadina) are clearly independent, and two directors (Rourke and Tsujimoto) are clearly not independent. The independence of the remaining three directors (Corbett, Coltrane, and Feng) is under revie

Section 303A.00 of the Manual provides that a company listing in connection with its IPO may avail itself of the following phase-in period for board independence: at least one independent director at the time of listing, with the board achieving a majority of independent directors within one year of the listing date. AHT has at least two independent directors (Whittemore and Obadina) at listing, which exceeds the pha

5. Recommendation. We recommend that the Company complete the independence assessment for Leonard Corbett, Diana Coltrane, and Howard Feng as promptly as practicable based on their D&O questionnaire responses, including a thorough review of any commercial relationships between Brindoval Summit, Ridgeline, and their respective affiliates, on the one hand, and AHT, on the other. The results of this assessment should be

1. Composition and Independence NYSE Requirement. Sections 303A.06 and 303A.07 of the Manual, together with Rule 10A-3 under the Exchange Act, require that the audit committee consist of a minimum of three members, all of whom must satisfy the general independence requirements of Section 303A.02 and the heightened independence requirements of Rule 10A-3. Under Rule 10A-3(b)(1), an audit committee member may not, dire

2. Financial Literacy and Audit Committee Financial Expert NYSE Requirement. Section 303A.07(a) of the Manual requires that all members of the audit committee be financially literate, as determined by the board of directors in its business judgment, or must become financially literate within a reasonable period of time after appointment to the audit committee. In addition, at least one member of the audit committee m

3. Audit Committee Charter NYSE Requirement. Section 303A.07(b) of the Manual requires that the audit committee have a written charter that addresses the committee's purpose and responsibilities, including (a) the committee's authority to engage independent advisors, (b) the committee's responsibility for the appointment, compensation, retention, and oversight of the work of the independent registered public accounti

1. Corporate Governance Guidelines (Section 303A.09) NYSE Requirement. Section 303A.09 of the Manual requires that listed companies adopt and disclose corporate governance guidelines addressing a range of governance matters, including director qualification standards, director responsibilities, director access to management and independent advisors, director compensation, director orientation and continuing education

2. Code of Business Conduct and Ethics (Section 303A.10) NYSE Requirement. Section 303A.10 of the Manual requires that listed companies adopt and disclose a code of business conduct and ethics applicable to all directors, officers, and employees. The code must address, at a minimum, conflicts of interest, corporate opportunities, confidentiality, fair dealing, protection and proper use of company assets, compliance w

3. CEO Certification (Section 303A.12) NYSE Requirement. Section 303A.12(a) of the Manual requires that the chief executive officer of each listed company certify to the NYSE annually that he or she is not aware of any violation by the company of NYSE corporate governance listing standards, qualifying such certification to the extent necessary to indicate any material qualifications. In addition, an interim CEO certi

4. Annual Written Affirmation (Section 303A.12(b)) NYSE Requirement. Section 303A.12(b) of the Manual requires that each listed company provide a written affirmation to the NYSE annually and on an interim basis within specified time frames, confirming compliance with applicable NYSE corporate governance standards. The affirmation must address, among other things, the composition and independence of the board and its

5. Non-Executive Sessions (Section 303A.03) NYSE Requirement. Section 303A.03 of the Manual requires that the non-management directors of each listed company meet at regularly scheduled executive sessions without management present. If the group of non-management directors includes directors who are not independent under the NYSE's independence standards, the independent directors of the company must also meet separa

6. Classified Board / Anti-Takeover Provisions Analysis. AHT's Amended and Restated Certificate of Incorporation (the "Charter"), which will be filed with the Secretary of State of the State of Delaware on the closing date of the IPO (expected February 13, 2024), includes the following governance and anti-takeover provisions: (a) Classified Board. The Charter provides for a classified board of directors, divided into

7. Stockholder Approval Requirements (Section 312) NYSE Requirement. Section 312 of the Manual requires stockholder approval for certain significant transactions by NYSE-listed companies, including (a) the adoption of equity compensation plans and material amendments thereto, (b) certain issuances of common stock (or securities convertible into common stock) involving 20% or more of the outstanding shares or voting p