Contract analysis

I. Purpose of Memorandum This memorandum is submitted to the New Matter Committee and the General Counsel's Office to establish new matter number 1001-00001 in the firm's matter management system. The matter encompasses the full scope of the Hart-Scott-Rodino premerger notification filing and antitrust clearance workstream in connection with the proposed acquisition of Pinnacle Health Systems, Inc. ("Pinnacle" or "PH

II. Client Information The following information identifies the client entity, its organizational structure, and the principal client contacts for purposes of this engagement. Client Entity: Ardent Capital Partners III LP Short Names / Alternate References: Ardent Capital, Ardent CP, Fund III Entity Type: Delaware limited partnership, formed under the Delaware Revised Uniform Limited Partnership Act Employer Identifi

III. Engagement Team The following Calderwood & Harkness LLP attorneys have been assigned to this matter and will serve as the primary engagement team. All billing rates reflect the firm's 2024 standard rates as agreed in the engagement letter dated January 29, 2024. Responsible Partner & Billing Partner: Howard Bellamy, Partner, Antitrust & Competition Practice Group. Mr. Bellamy will serve as the responsible partne

IV. Transaction Overview A. Transaction Structure The proposed transaction is structured as a 100% equity acquisition in the form of a stock purchase, pursuant to which Ardent Capital Partners III LP (or a newly formed acquisition subsidiary thereof) will acquire all of the outstanding shares of capital stock of Pinnacle Health Systems, Inc. from its existing stockholders. Acquirer: Ardent Capital Partners III LP. We

V. HSR Filing Parameters A. Threshold Analysis (2024) The following analysis confirms that the proposed transaction meets the applicable thresholds under Section 7A of the Clayton Act, 15 U.S.C. § 18a, as amended (the "HSR Act"), and the implementing regulations promulgated thereunder, 16 C.F.R. Parts 801–803, and that a premerger notification filing is required. Size-of-Transaction Test: The aggregate total amount o

VI. Acquirer's Existing Healthcare Portfolio Companies (Overlap Considerations) For purposes of the antitrust analysis and the HSR filing, it is necessary to identify and evaluate the existing healthcare portfolio companies held by Ardent Capital Partners III LP (and its affiliates) that may present horizontal or vertical competitive overlaps with Pinnacle's business. Based on our review of Ardent Capital's current p

1. Marlowe Asset Management Rehabilitation Holdings LLC Marlowe Asset Management Rehabilitation Holdings LLC ("Marlowe Asset Management Rehab") operates a chain of outpatient physical therapy and rehabilitation clinics. The company currently operates 74 clinic locations across three states: Texas, Florida, and Georgia. Marlowe Asset Management Rehab is headquartered at 8950 Westheimer Road, Suite 600, Houston, TX 770

2. Clearpath Diagnostics Inc. Clearpath Diagnostics Inc. ("Clearpath") provides independent clinical laboratory services across Pennsylvania, New Jersey, and New York. The company generates approximately $218 million in annual revenue and is headquartered at 1700 Market Street, Suite 3400, Philadelphia, PA 19103. Overlap Assessment: Clearpath's operations are exclusively in Pennsylvania, New Jersey, and New York. Pin

VII. Other Transaction Advisors and Service Providers The following table identifies the other principal advisors and service providers engaged in connection with the transaction. This information is provided for conflicts clearance purposes, for coordination among workstreams, and for reference by the engagement team. We will coordinate with Whitfield & Crane LLP on all matters relating to the interplay between the

VIII. Anticipated Deliverables and Workstreams The following is a summary of the principal deliverables and workstreams that we anticipate will be required in connection with this engagement. This list is not exhaustive and may be supplemented as the engagement progresses, particularly if the reviewing agency issues a Second Request or otherwise seeks additional information.

1. HSR Notification Form Preparation (Acquiring Person) We will prepare the complete HSR Premerger Notification and Report Form for the acquiring person, including all required items (Items 1 through 8). The filing will include the entity structure chart depicting the acquiring person's organizational structure (including the UPE, the general partner, the investment manager, and the acquisition vehicle), revenue and

2. Item 4(c) / 4(d) Document Collection and Review We will instruct the client on the scope and requirements of the Item 4(c) and 4(d) document production obligations, which require the submission of certain documents prepared by or for officers and directors of the acquiring person that analyze the proposed transaction with respect to markets, market shares, competition, competitors, potential for sales growth, or e

3. Substantive Antitrust Analysis The substantive antitrust analysis will encompass the following components: • Preliminary Antitrust Risk Assessment Memorandum: We will prepare a comprehensive memorandum assessing the overall antitrust risk profile of the transaction for the client's internal use. This memorandum will evaluate the likelihood of agency challenge, the potential theories of competitive harm, and the ri

4. Early Termination Request and Voluntary Submission (White Paper) Concurrently with the HSR filing, we will submit a formal letter to the Premerger Notification Office requesting early termination of the statutory waiting period. In support of the early termination request, we will prepare a substantive competitive analysis white paper for submission to FTC staff. The white paper will summarize the transaction, des

5. Coordination with Counterparty Antitrust Counsel We will establish a formal coordination protocol with Jonathan Felder at Greenvale Durneval LLP, who is serving as antitrust counsel to the acquired person. The coordination protocol will address: (i) consistency of NAICS code designations and market definitions between the two filings; (ii) simultaneous filing logistics and submission timing; (iii) coordination of

6. FTC/DOJ Correspondence We will prepare the cover letter to the Premerger Notification Office accompanying the HSR filing and will handle all communications with FTC staff throughout the review process. If the transaction is cleared to the DOJ rather than the FTC through the interagency clearance process, we will redirect our communications accordingly, though based on the healthcare services focus of the transacti

7. Client Reporting We will provide bi-weekly written status reports to Julian Desmond and Priya Chandrasekar summarizing the status of the HSR filing, any communications with the reviewing agency, and the progress of our substantive antitrust analysis. We will also provide real-time updates on any significant developments, including the assignment of reviewing staff, any informal requests for information, and the gr

8. Closing Deliverables Upon the expiration or early termination of the HSR waiting period, we will prepare the following closing deliverables: (i) an HSR clearance certificate in the form of an officer's certificate confirming the satisfaction of the regulatory condition precedent under EPA §6.1(c); and (ii) confirmation letters to transaction counsel (Whitfield & Crane LLP) and seller's counsel (Fendowell Thornton

9. Matter Wrap-Up Following the closing of the transaction (or the termination of the EPA, as the case may be), we will prepare a closing memorandum summarizing the HSR process and the antitrust analysis performed, render a final invoice, and issue a matter closing letter. All files and work product will be archived in the firm's document management system under Matter No. 1001-00001 in accordance with the firm's doc

IX. Regulatory Contacts The following regulatory contacts are relevant to this engagement: Federal Trade Commission, Bureau of Competition, Premerger Notification Office ("PNO"): The PNO is responsible for the administration of the HSR premerger notification program, including the receipt and processing of HSR filings, the assignment of reviewing staff, and the administration of requests for early termination of the

X. Conflicts Clearance Conflicts clearance for this engagement was conducted in accordance with the firm's standard conflicts clearance procedures. A Conflicts Check Memorandum was prepared and circulated on January 28, 2024, and the results of the conflicts check have been reviewed by the undersigned and by the firm's General Counsel's Office. Based on the results of the conflicts check, the firm has confirmed that

XI. Administrative Notes The following administrative items are noted for the record and for the information of the New Matter Committee: Matter Number: Matter number 1001-00001 has been opened in the firm's time and billing system (Aderant) as of February 1, 2024. Timekeeper Assignments: All three timekeepers assigned to this engagement — Howard Bellamy (Partner), Monica Reyes (Associate), and Elliot Nguyen (Associa