Philip,
I hope you're well. I'm writing on behalf of our client, Ardent Capital Partners III LP (the "Buyer"), in connection with the acquisition of Luminex Systems Holdings Inc. ("Luminex" or the "Target") by Ardent Apex Holdings Inc. (Calderwood & Harkness Matter No. 1001-00004).
Following the completion of underwriting diligence, the underwriter calls, and the negotiation of final policy terms, we are now in a position to provide binding instructions for the representations and warranties insurance policy to be placed with Grandview Specialty Insurance Company (Policy No. GSI-RWI-2025-04821). Please treat this email as the Buyer's formal instruction to Ashbury Risk Advisors to bind coverage on the terms set forth below.
**1. Transaction Summary**
For your file and to confirm the underlying transaction parameters:
- **Structure:** Reverse triangular merger — Ardent Apex Merger Sub Inc. ("Merger Sub") will merge with and into Luminex Systems Holdings Inc., with Luminex surviving as a wholly owned subsidiary of Ardent Apex Holdings Inc. - **Merger Agreement:** Agreement and Plan of Merger dated March 24, 2025, among Ardent Apex Holdings Inc., Ardent Apex Merger Sub Inc., and Luminex Systems Holdings Inc. - **Aggregate Equity Value:** $2,800,000,000 - **Per-Share Merger Consideration:** $20.00 per share (based on 140,000,000 fully diluted shares) - **Governing Law:** Delaware (DGCL) - **Estimated Closing:** Q3 2025 (July–August 2025)
**2. Policy Terms — Binding Confirmation**
Please bind coverage with Grandview on the following final agreed terms:
(a) **Carrier:** Grandview Specialty Insurance Company (domiciled in Connecticut)
(b) **Policy Number:** GSI-RWI-2025-04821
(c) **Named Insured:** Ardent Apex Holdings Inc. (and its successors and assigns, including the surviving corporation, Luminex Systems Holdings Inc.)
(d) **Policy Type:** Buy-side representations and warranties insurance
(e) **Policy Limit:** $420,000,000 (equal to 15% of enterprise value), which mirrors the indemnification cap under the Merger Agreement
(f) **Retention (Self-Insured Retention / Deductible):** $14,000,000 (equal to 0.5% of enterprise value) - Retention split: 50% Seller / 50% Buyer ($7,000,000 each) - The Seller's share of the retention is backstopped by the escrow arrangement: $140,000,000 deposited with Continental Fiduciary Trust Company (Escrow Account Ref: CFT-ESC-2025-7894)
(g) **Estimated Premium:** $8,400,000 (2.0% rate on the $420,000,000 policy limit) - One-time payment due at or prior to closing - Premium to be paid by the Buyer (Ardent Apex Holdings Inc.) as a transaction expense - Please confirm whether the underwriter has finalized the premium amount or whether the $8,400,000 figure remains subject to adjustment
(h) **Policy Period / Coverage Trigger:** Policy attaches at closing of the merger; coverage for breaches of representations and warranties contained in the Merger Agreement
(i) **Survival / Coverage Period:** - General representations and warranties: 18 months from closing - Fundamental representations: 36 months from closing - Tax representations: 60 days following expiration of the applicable statute of limitations - These periods are aligned with the indemnification survival periods set forth in the Merger Agreement
(j) **Escrow Period Alignment:** 18 months from closing, coterminous with the general representations survival period and the escrow release date
**3. Key Coverage and Exclusion Confirmations**
Please confirm the following with Grandview:
- The policy covers breaches of all of the Seller's and Target's representations and warranties in the Merger Agreement, as supplemented by the disclosure schedules delivered at signing. - The policy has been negotiated to include coverage for representations given by Luminex Systems Holdings Inc. and its subsidiaries, including Luminex Systems AG, Luminex Systems Inc., Luminex Systems UK Ltd., Luminex Systems GmbH, and Luminex Systems Pte. Ltd. - The underwriting diligence process has been completed, including underwriter calls with our deal team and Grandview's review of the virtual data room. - Please confirm the final list of exclusions and ensure that any exclusions that were negotiated down or removed during the placement process are accurately reflected in the final binder and policy form.
**4. Parties to the Policy**
- **Named Insured:** Ardent Apex Holdings Inc. - **Additional Insureds (as applicable):** - Ardent Capital Partners III LP - Ardent Apex Merger Sub Inc. (pre-merger) - Luminex Systems Holdings Inc. (as surviving corporation, post-closing) - **Loss Payee Coordination:** Please note that Stonebridge Credit Partners LLC, as administrative agent under the senior secured credit facility, may require an acknowledgment or lender endorsement. We would ask that Ashbury coordinate with Grandview on this point as needed — we will provide the relevant credit facility contact information separately if required.
**5. Binding and Issuance Instructions**
- Please instruct Grandview to bind coverage effective as of the closing date of the merger (anticipated Q3 2025, July–August 2025). - We request that Grandview issue a binder or written confirmation of coverage promptly upon receipt of these instructions. - Please arrange for delivery of the final policy form to Calderwood & Harkness for review at least **five (5) business days** prior to the anticipated closing date. The executed R&W insurance policy is a closing deliverable under both the Merger Agreement and the senior secured credit facility documentation, so timely delivery is critical.
**6. Premium Payment Mechanics**
- Please provide wire instructions for the premium payment at your earliest convenience. - We confirm that the premium of approximately $8,400,000 will be wired at or immediately prior to closing. The premium payment will be reflected in the funds flow memorandum as a Buyer transaction expense. - Please issue a formal invoice or premium notice for the Buyer's records.
**7. Underwriting Materials**
The following documents were previously provided to Ashbury and Grandview during the underwriting process. We are not attaching them again here but ask that you confirm you have the final execution versions of each:
- Execution version of the Agreement and Plan of Merger dated March 24, 2025 - Buyer's disclosure schedules - Seller's/Target's disclosure schedules - R&W insurance application memorandum (submitted by Calderwood & Harkness) - Due diligence summary memoranda (corporate, intellectual property, material contracts, employment, litigation, and tax)
Please let us know if you need updated or additional materials to finalize binding.
**8. Next Steps**
We would appreciate it if you could:
1. Confirm receipt of these binding instructions; 2. Confirm by email or phone call once Grandview has acknowledged and confirmed the bind; 3. Provide an estimated timeline for delivery of the final policy wording; and 4. Flag immediately any open negotiation points on policy language so that we can resolve them well in advance of closing.
Please don't hesitate to reach out to me directly at the number below. James Prentice, who is copied here, is the responsible partner on this matter and is available as needed.
Thank you for your work on the placement, Philip. We look forward to your confirmation.
Best regards,
Ryan Kowalski Associate, Mergers & Acquisitions Calderwood & Harkness LLP 7 Times Square New York, NY 10036 Direct: (212) 555-3847 Email: rkowalski@calderwoodharkness.com
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