BILL OF SALE
Executed and delivered as of June 30, 2024
This BILL OF SALE (this "Bill of Sale") is executed and delivered as of June 30, 2024, by Cardinal Peak Industries, Inc., a Delaware corporation ("Seller"), with its principal offices located at 8400 Crescent Ridge Parkway, Suite 200, Nashville, Tennessee 37215, to and in favor of Ardent Healthcare Acquisition Corp., a Delaware corporation ("Purchaser"), with its registered offices located at c/o National Registered Services, Inc., 1209 Orange Street, Wilmington, Delaware 19801. Seller and Purchaser are each sometimes referred to herein individually as a "Party" and collectively as the "Parties."
RECITALS
WHEREAS, Seller and Purchaser are parties to that certain Asset Purchase Agreement, dated as of April 2, 2024 (as the same may be amended, restated, supplemented, or otherwise modified from time to time in accordance with its terms, the "APA"), by and between Seller and Purchaser. Capitalized terms used but not defined herein shall have the meanings ascribed to such terms in the APA;
WHEREAS, pursuant to the APA, Seller has agreed to sell, convey, assign, transfer, and deliver to Purchaser, and Purchaser has agreed to purchase and acquire from Seller, substantially all of the assets of Seller constituting the Acquired Assets (as defined in the APA), subject to the terms and conditions set forth in the APA;
WHEREAS, the Base Purchase Price for the Acquired Assets is Six Hundred Twenty Million Dollars ($620,000,000), subject to the adjustments (including working capital adjustments), escrow holdback, and earnout provisions set forth in Article II of the APA;
WHEREAS, this Bill of Sale is being executed and delivered by Seller to Purchaser at the Closing on June 30, 2024 (the "Closing Date"), pursuant to and in accordance with Section 7.2(a)(iii) of the APA, as one of the closing deliverables required to be delivered by Seller to Purchaser at or prior to the Closing; and
WHEREAS, Seller is a Delaware corporation qualified to do business in the States of Tennessee, Georgia, North Carolina, South Carolina, Alabama, Virginia, and Kentucky, and operates thirty-seven (37) outpatient rehabilitation and behavioral health clinic facilities across those seven states (collectively, the "Clinic Facilities").
NOW, THEREFORE, for and in consideration of the premises, the mutual covenants and agreements set forth in the APA, the payment of the Base Purchase Price and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and intending to be legally bound hereby, Seller does hereby agree as follows:
SECTION 1. TRANSFER AND CONVEYANCE OF ACQUIRED ASSETS
Seller hereby sells, conveys, assigns, transfers, and delivers to Purchaser, and Purchaser's successors and permitted assigns, all of Seller's right, title, and interest in and to all personal property assets included within the definition of "Acquired Assets" under Article I and Section 2.1 of the APA, free and clear of all liens, claims, pledges, mortgages, security interests, charges, options, encumbrances, and restrictions of any kind or nature whatsoever (collectively, "Encumbrances"), other than Permitted Encumbrances (as defined in the APA), including, without limitation, the following:
(a) Tangible Personal Property. All tangible personal property, including, without limitation, all furniture, fixtures, equipment, medical devices and diagnostic equipment, rehabilitation apparatus and therapy devices, computer hardware, servers, networking equipment, vehicles, tools, spare parts, supplies, inventory, and other items of tangible personal property located at, held for use at, or used in connection with Seller's thirty-seven (37) Clinic Facilities, as more particularly described on Schedule 2.1(a) to the APA, distributed across the following jurisdictions:
(i) Tennessee — fourteen (14) locations;
(ii) Georgia — eight (8) locations;
(iii) North Carolina — five (5) locations;
(iv) South Carolina — four (4) locations;
(v) Alabama — three (3) locations;
(vi) Virginia — two (2) locations; and
(vii) Kentucky — one (1) location;
(b) Books and Records. All books, records, files, papers, correspondence, and documents, whether in physical or electronic form, relating to the Acquired Assets or to the operation, management, or conduct of the business, including patient records (to the extent transferable in accordance with applicable law, including without limitation the Health Insurance Portability and Accountability Act of 1996, as amended, and the regulations promulgated thereunder), operational records, financial records, vendor files, regulatory correspondence, accreditation files, and quality assurance records, but specifically excluding the Excluded Assets and Excluded Records (as each such term is defined in the APA);
(c) Prepaid Expenses and Deposits. All prepaid expenses, security deposits, utility deposits, credits, and advance payments relating to the Acquired Assets or the operation of the business, including, without limitation, prepaid insurance premiums, prepaid rent, and prepaid maintenance and service agreement charges, in each case to the extent included in the calculation of Closing Net Working Capital under Section 2.4 of the APA;
(d) Accounts Receivable. All accounts receivable and notes receivable, whether billed or unbilled, arising out of the operation of the business as of the Closing Date, including, without limitation, receivables from commercial insurance payors, Medicare and Medicaid programs, self-pay patients, and all other third-party payors, together with any security held by any Person therefor;
(e) Warranties and Guarantees. All rights under warranties, guarantees, indemnities, and similar rights from manufacturers, vendors, suppliers, and other third parties with respect to the tangible personal property included in the Acquired Assets, whether or not such warranties, guarantees, indemnities, or similar rights are transferable by their terms, and to the extent any such warranty, guarantee, indemnity, or similar right is not assignable or transferable, Seller shall use commercially reasonable efforts to cooperate with Purchaser to provide Purchaser with the benefits thereof;
(f) Goodwill. All goodwill associated with the business as a going concern, including, without limitation, the goodwill associated with each of the Clinic Facilities, patient relationships, referral source relationships, and the reputation and workforce in place at each location;
(g) Telecommunications and Digital Assets. All telephone numbers, fax numbers, email addresses, internet domain names, social media accounts, website content, and other similar identifiers used in connection with the business, to the extent not constituting intellectual Property being transferred pursuant to the IP Assignment Agreement (as defined below); and
(h) Permits, Licenses, and Governmental Authorizations. All permits, licenses, certificates, registrations, consents, approvals, franchises, variances, exemptions, and other governmental authorizations, to the extent transferable by operation of law or otherwise, including, without limitation, healthcare facility licenses issued by each applicable state department of health, Clinical Laboratory Improvement Amendments certificates, Drug Enforcement Administration registrations, Medicare and Medicaid provider numbers and supplier agreements (to the extent assignable under applicable law and regulation), and certificates of need (to the extent applicable).
For the avoidance of doubt, the Parties acknowledge and agree that (i) certain intellectual property assets of Seller, including, without limitation, the PeakConnect patient-engagement software platform, all associated source code, documentation, and related technology, and U.S. Trademark Registration No. 5,412,887 for the mark "CARDINAL PEAK CONNECT" (and all common-law rights therein), are the subject of a separate intellectual Property Assignment Agreement of even date herewith between Seller and Purchaser (the "IP Assignment Agreement"), and (ii) the assumption of assigned contracts and assumed liabilities of Seller by Purchaser is the subject of a separate Assignment and Assumption Agreement of even date herewith between Seller and Purchaser (the "Assignment and Assumption Agreement"). The foregoing instruments, together with this Bill of Sale, are collectively delivered to effectuate the transactions contemplated by the APA, and each such instrument shall be construed in accordance with and subject to the APA.
SECTION 2. EXCLUDED ASSETS
Notwithstanding anything to the contrary contained herein, this Bill of Sale does not transfer, and Seller expressly retains and reserves all right, title, and interest in and to, the Excluded Assets as defined in Section 2.2 of the APA, including, without limitation, the following:
(a) all cash, cash equivalents, bank accounts, certificates of deposit, money market accounts, and marketable securities of Seller, wherever located;
(b) all tax refunds, credits, prepayments, and overpayments attributable to any Pre-Closing Tax Period (as defined in the APA), including, without limitation, any refunds of federal, state, or local income taxes, franchise taxes, or employment taxes relating to periods ending on or prior to the Closing Date;
(c) certain personal property of Dr. Randall J. Whitfield, individually, as specifically identified and described on Schedule 2.2(c) to the APA, including certain artwork, personal memorabilia, and other personal effects located at the Nashville headquarters and certain Clinic Facilities;
(d) the "Cardinal Peak Industries" corporate name (including all trade names, service marks, and other rights appurtenant thereto), subject to the twelve (12)-month transitional license-back granted to Purchaser pursuant to Section 6.12 of the APA, which license-back shall permit Purchaser to use the "Cardinal Peak" name solely in connection with the operation of the Clinic Facilities during the transition period on the terms and conditions set forth therein;
(e) all equity interests, including all issued and outstanding shares of capital stock, in Cardinal Peak Labs, Inc., a dormant Delaware corporation and wholly-owned inactive subsidiary of Seller, which entity holds no material assets and conducts no operations as of the date hereof; and
(f) all rights of Seller under or pursuant to the APA, any ancillary agreements executed in connection therewith (including the IP Assignment Agreement, the Assignment and Assumption Agreement, the Escrow Agreement, the Non-Competition Agreement, the Transition Services Agreement, and any other agreements contemplated by the APA), and this Bill of Sale.
SECTION 3. CONDITION OF ASSETS; APA REPRESENTATIONS CONTROL
The personal property assets transferred pursuant to this Bill of Sale are conveyed "AS IS, WHERE IS" and in their present condition as of the Closing Date, with all faults and defects, whether latent or patent.
No representations or warranties are made by Seller in this Bill of Sale with respect to the Acquired Assets or any other matter. The representations and warranties of Seller with respect to the Acquired Assets, the business, and the transactions contemplated by the APA are made solely in, and are governed exclusively by, Article III of the APA, and are subject in all respects to the survival periods, indemnification limitations, deductible baskets, indemnification caps, and other provisions and limitations set forth in the APA, including, without limitation, the following:
(i) the eighteen (18)-month survival period applicable to general representations and warranties of Seller under Article III of the APA, which survival period shall expire at 11:59 p.m. Eastern Time on December 30, 2025;
(ii) the thirty-six (36)-month survival period applicable to the Fundamental Representations of Seller (as defined in Section 8.1 of the APA), which survival period shall expire at 11:59 p.m. Eastern Time on June 30, 2027; and
(iii) the aggregate indemnification cap of One Hundred Twenty-Four Million Dollars ($124,000,000), representing twenty percent (20%) of the Base Purchase Price, applicable to indemnification claims asserted by Purchaser under Article VIII of the APA (subject to the exceptions set forth therein for claims based on fraud, willful misconduct, or breaches of Fundamental Representations).
Nothing in this Bill of Sale shall be deemed to expand, limit, modify, amend, supplement, or otherwise alter the representations, warranties, covenants, agreements, conditions, or indemnification obligations of any Party under the APA. In the event that any provision of this Bill of Sale could be interpreted as creating any representation, warranty, covenant, or agreement not expressly set forth in the APA, such interpretation shall not be given effect, and the provisions of the APA shall control.
SECTION 4. FURTHER ASSURANCES
Seller agrees that, from time to time after the Closing, at the reasonable written request of Purchaser and at Purchaser's sole cost and expense (except as otherwise expressly provided in the APA), Seller shall execute and deliver such further instruments of sale, transfer, conveyance, assignment, and confirmation, and shall take such other actions, as Purchaser may reasonably request in order to more effectively transfer, convey, and assign to Purchaser, and to confirm Purchaser's right, title, and interest in and to, the Acquired Assets conveyed by this Bill of Sale. Without limiting the generality of the foregoing, Seller shall cooperate with Purchaser in connection with the re-registration or transfer of any permits, licenses, or governmental authorizations included in the Acquired Assets, and shall execute and deliver such applications, consents, and other documents as may be reasonably required to complete any such re-registration or transfer.
SECTION 5. CONFLICT WITH APA; APA CONTROLS
In the event of any conflict, inconsistency, or ambiguity between the terms and provisions of this Bill of Sale and the terms and provisions of the APA, the terms and provisions of the APA shall govern, control, and prevail in all respects. This Bill of Sale is subject in all respects to the terms, conditions, limitations, and provisions set forth in the APA, and nothing herein shall be construed to modify, amend, supplement, or supersede any provision of the APA.
SECTION 6. NO THIRD-PARTY BENEFICIARIES
This Bill of Sale is for the sole and exclusive benefit of the Parties hereto and their respective successors and permitted assigns, and nothing herein, express or implied, is intended to or shall confer upon any other Person (including, without limitation, any employee, patient, vendor, creditor, or equity holder of Seller or Purchaser) any legal or equitable right, benefit, remedy, or claim of any nature whatsoever under or by reason of this Bill of Sale.
SECTION 7. SUCCESSORS AND ASSIGNS
This Bill of Sale shall be binding upon and shall inure to the benefit of the Parties hereto and their respective successors and permitted assigns. Neither Party may assign its rights or obligations under this Bill of Sale except in accordance with the assignment provisions set forth in the APA.
SECTION 8. GOVERNING LAW
This Bill of Sale shall be governed by, and construed and enforced in accordance with, the internal laws of the State of Delaware, without giving effect to any choice-of-law or conflict-of-law rules or provisions (whether of the State of Delaware or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of Delaware.
SECTION 9. COUNTERPARTS; ELECTRONIC SIGNATURES
This Bill of Sale may be executed in one or more counterparts, each of which when so executed and delivered shall be deemed to be an original, and all of which counterparts, taken together, shall constitute one and the same instrument. Delivery of an executed counterpart of a signature page to this Bill of Sale by electronic transmission, including by portable document format (.pdf), facsimile, or through the use of an electronic signature platform such as DocuSign, shall be effective as delivery of a manually executed counterpart of this Bill of Sale, and each Party hereby waives any objection to the use of electronic signatures in connection herewith.
[Signature Page Follows]
IN WITNESS WHEREOF, Seller has caused this Bill of Sale to be duly executed and delivered as of the date first written above.
SELLER:
CARDINAL PEAK INDUSTRIES, INC.
By: ________
Name: Dr. Randall J. Whitfield
Title: Chairman and Chief Executive Officer
Date: June 30, 2024
ACKNOWLEDGED AND ACCEPTED BY PURCHASER:
ARDENT HEALTHCARE ACQUISITION CORP.
By: ________
Name: Priya Mehta-Sullivan
Title: President
Date: June 30, 2024
Signature Page to Bill of Sale