1001-00001 · Ardent Capital Partners · Closing

hsr-clearance-certificate.docx DOCUMENT Antitrust

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OFFICER'S CERTIFICATE

Regarding Expiration or Early Termination of the Waiting Period Under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as Amended

Delivered pursuant to Section 6.1(c) of that certain Equity Purchase Agreement, dated as of January 31, 2024

Date of Certificate: May 12, 2024

RECITALS

Reference is hereby made to that certain Equity Purchase Agreement (the "EPA"), dated as of January 31, 2024, by and among:

(i) Ardent Capital Partners III LP, a Delaware limited partnership (the "Buyer");

(ii) Pinnacle Health Systems, Inc., a Delaware corporation (the "Company");

(iii) Veltrano Equity Holdings LLC, a Delaware limited liability company, acting through Veltrano Equity Partners Fund V LP, a Delaware limited partnership (the "Seller"); and

(iv) Dr. Marcus Ellsworth and certain other management rollover participants identified on Schedule A to the EPA (collectively, the "Rollover Holders," and together with the Buyer, the Company, and the Seller, the "Parties").

Capitalized terms used but not otherwise defined in this Certificate shall have the respective meanings ascribed to such terms in the EPA.

This Officer's Certificate (this "Certificate") is being delivered by the undersigned on behalf of the Buyer pursuant to Section 6.1(c) of the EPA as a condition precedent to the closing of the transactions contemplated by the EPA (the "Closing"). The Closing is occurring on the date hereof, May 12, 2024, in accordance with Section 2.3 of the EPA and the other terms and conditions set forth therein.

CERTIFICATION

The undersigned hereby certifies the following:

Section 1. Identity and Authority of Certifying Officer

The undersigned, Julian Desmond, hereby certifies that he is a Co-Founder and Managing Partner of Ardent Capital Management LLC, a Delaware limited liability company (EIN: 84-5567312), with its principal offices located at 399 Park Avenue, 41st Floor, New York, New York 10022. Ardent Capital Management LLC is the sole member of Ardent Capital GP III LLC, a Delaware limited liability company (EIN: 86-2198403), which in turn serves as the sole general partner of Ardent Capital Partners III LP, a Delaware limited partnership (EIN: 87-3421098). In his capacity as Co-Founder and Managing Partner of Ardent Capital Management LLC, the undersigned is duly authorized to execute and deliver this Certificate on behalf of Ardent Capital Management LLC, in its capacity as the indirect general partner of the Buyer, pursuant to the governing documents of Ardent Capital Management LLC, the limited liability company agreement of Ardent Capital GP III LLC, and the limited partnership agreement of Ardent Capital Partners III LP. The undersigned has personal knowledge of the facts and matters set forth herein and is competent to certify as to the same.

Section 2. Description of the Transaction

The EPA contemplates the acquisition by Ardent Capital Partners III LP of one hundred percent (100%) of the outstanding equity interests, consisting of all issued and outstanding shares of capital stock, of Pinnacle Health Systems, Inc. (the "Transaction"). Pinnacle Health Systems, Inc. is a corporation organized and existing under the laws of the State of Delaware (EIN: 56-4389201), with its principal place of business located at 2200 Lakeshore Boulevard, Suite 500, Charlotte, North Carolina 28202. The Company is engaged in the business of providing specialty physician practice management services, ambulatory surgical center operations, and ancillary healthcare services across thirteen states. The aggregate enterprise value of the Transaction, as set forth in Section 2.2 of the EPA, is Nine Hundred Fifty-Two Million Dollars ($952,000,000), inclusive of equity consideration, assumed indebtedness, and the estimated rollover value attributable to the Rollover Holders.

The Transaction constitutes an acquisition of voting securities and assets that is subject to the notification and waiting period requirements of the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, 15 U.S.C. § 18a (the "HSR Act"), and the rules and regulations promulgated thereunder by the Federal Trade Commission (the "FTC"), codified at 16 C.F.R. Parts 801–803. As of the date of the EPA, the size-of-transaction and size-of-person thresholds established by the FTC for the 2024 reporting year were satisfied, requiring the filing of premerger notification under the HSR Act prior to consummation of the Transaction.

Section 3. HSR Filing and Notification

On February 16, 2024, in accordance with the requirements of the HSR Act and the rules promulgated thereunder, each of the Buyer and the Company filed its respective Notification and Report Form (the "HSR Filings") with the FTC and the Antitrust Division of the United States Department of Justice (the "DOJ"). The FTC assigned Transaction Number 20241487 to the HSR Filings.

The applicable filing fee of Two Hundred Eighty Thousand Dollars ($280,000) was timely paid by the Buyer through the electronic filing system maintained by the FTC, in accordance with Section 5.4(a) of the EPA, which provides that the Buyer shall bear all filing fees and expenses arising under the HSR Act. The filing fee amount was determined in accordance with the 2024 FTC fee schedule, as adjusted pursuant to Section 605(b) of the Departments of Commerce, Justice, and State, the Judiciary, and Related Agencies Appropriations Act of 1990 (Pub. L. No. 101-162), applicable to transactions with a total value in excess of Five Hundred Million Dollars ($500,000,000) but less than or equal to Nine Hundred Ninety-Nine Million Nine Hundred Thousand Dollars ($999,900,000).

Both the Buyer's and the Company's HSR Filings included, in accordance with the procedures set forth in the FTC's Statement of Basis and Purpose and established agency practice, a request for early termination of the initial thirty (30) calendar day waiting period prescribed by Section 7A(b)(1)(B) of the Clayton Act, as amended by the HSR Act (15 U.S.C. § 18a(b)(1)(B)).

Section 4. Certification of Early Termination

The undersigned hereby certifies, to the best of his knowledge, information, and belief, each of the following:

(a) Grant of Early Termination. The FTC granted early termination of the waiting period applicable to the Transaction on March 8, 2024, pursuant to Early Termination Notice No. 20240683, a true and correct copy of which is attached hereto as Exhibit A and incorporated herein by reference.

(b) Federal Register Publication. The FTC's notice of early termination of the waiting period with respect to the Transaction was published in the Federal Register on March 12, 2024, in accordance with the FTC's customary practice of publishing early termination notices in periodic batches.

(c) Mootness of Initial Waiting Period. The initial thirty (30) calendar day waiting period under Section 7A(b)(1)(B) of the Clayton Act, which would otherwise have expired at 11:59 p.m. Eastern Time on March 17, 2024 (i.e., thirty (30) calendar days following the date on which both HSR Filings were received by the FTC and the DOJ), was rendered moot by the grant of early termination on March 8, 2024, nine (9) days prior to the scheduled expiration of the initial waiting period.

(d) No Second Request. Neither the FTC nor the DOJ issued a request for additional information or documentary material (commonly referred to as a "Second Request") pursuant to Section 7A(e) of the Clayton Act (15 U.S.C. § 18a(e)) in connection with the Transaction. No voluntary access letter, civil investigative demand, or other compulsory process was issued by the FTC, the DOJ, or any other federal or state governmental authority in connection with the review of the Transaction under the HSR Act or any other antitrust statute.

(e) No Pending or Threatened Action. As of the date hereof, no action, suit, proceeding, investigation, or inquiry has been commenced, initiated, or, to the knowledge of the undersigned, threatened by the FTC, the DOJ, any state attorney general, or any other governmental authority under the HSR Act, Sections 1 or 2 of the Sherman Antitrust Act of 1890 (15 U.S.C. §§ 1–2), Section 7 of the Clayton Act (15 U.S.C. § 18), Section 5 of the Federal Trade Commission Act (15 U.S.C. § 45), or any other applicable federal or state antitrust, competition, or unfair trade practices law, seeking to enjoin, restrain, prohibit, condition, or otherwise prevent consummation of the Transaction or to impose any material limitation on the ability of the Buyer to exercise full rights of ownership with respect to the equity interests of the Company following the Closing.

(f) No Remedial Requirements. No consent decree, consent order, hold-separate agreement, hold-separate order, timing agreement, divestiture requirement, behavioral remedy, structural remedy, or any other condition, commitment, undertaking, or restriction of any kind was required by, or agreed to with, the FTC, the DOJ, or any other governmental authority as a condition to or in connection with the clearance of the Transaction under the HSR Act or any other applicable antitrust law. The grant of early termination was unconditional in all respects.

Section 5. Satisfaction of Section 6.1(c) Closing Condition

Based on the foregoing certifications, the undersigned hereby certifies that the condition to the Closing set forth in Section 6.1(c) of the EPA — which provides, in relevant part, that "[t]he applicable waiting period (and any extension thereof) under the HSR Act shall have expired or been terminated" — has been fully and unconditionally satisfied as of the date hereof. The early termination of the applicable waiting period under the HSR Act occurred on March 8, 2024, and no event or circumstance has occurred since such date that would cause the waiting period to recommence or that would otherwise require additional filings, notifications, or consents under the HSR Act or any other federal antitrust statute in connection with the consummation of the Transaction on the date hereof.

No further action, filing, notification, or consent under the HSR Act or any other federal or state antitrust statute is required in connection with the consummation of the Transaction, and the Buyer is not aware of any facts or circumstances that would reasonably be expected to give rise to any such requirement.

Section 6. Reliance and Disclaimer

This Certificate is being delivered solely for purposes of satisfying the condition to Closing set forth in Section 6.1(c) of the EPA and shall not be deemed to constitute a representation, warranty, or certification for any other purpose. This Certificate may be relied upon by (a) each of the Parties to the EPA, (b) their respective legal counsel, (c) any title company, escrow agent, or paying agent acting in connection with the Closing, and (d) any lender or financing source providing debt financing in connection with the Transaction, in each case solely in connection with the consummation of the Closing.

This Certificate does not constitute an opinion of counsel or a legal conclusion regarding any antitrust or competition law matter, whether federal, state, or foreign, beyond the specific certifications expressly set forth herein. Nothing in this Certificate shall be construed to modify, amend, supplement, or waive any representation, warranty, covenant, or agreement contained in the EPA, and the representations and warranties set forth in the EPA shall not be affected or deemed modified by the delivery of this Certificate.

Section 7. Governing Law

This Certificate shall be governed by and construed in accordance with the laws of the State of Delaware, without giving effect to any choice or conflict of law provision or rule (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, consistent with Section 9.8 of the EPA.

IN WITNESS WHEREOF, the undersigned has duly executed this Officer's Certificate as of May 12, 2024.

ARDENT CAPITAL PARTNERS III LP

By: Ardent Capital GP III LLC, its General Partner

By: Ardent Capital Management LLC, its Sole Member

By: ________

Name: Julian Desmond

Title: Co-Founder & Managing Partner

Date: May 12, 2024

Address for Notices:

Ardent Capital Management LLC 399 Park Avenue, 41st Floor New York, New York 10022

Attention: Julian Desmond, Co-Founder & Managing Partner

Email: jdesmond@ardentcapital.com

EXHIBIT A

FTC Early Termination Grant Notice Early Termination Notice No. 20240683 Transaction No. 20241487 Received March 8, 2024

[Copy of Early Termination Notice attached hereto]

This Certificate was prepared by Calderwood & Harkness LLP (Matter No. 1001-00001), antitrust counsel to Ardent Capital Partners III LP, 600 Lexington Avenue, New York, New York 10022.

OFFICER'S CERTIFICATE
Regarding Expiration or Early Termination of the Waiting Period Under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as Amended
Delivered pursuant to Section 6.1(c) of that certain Equity Purchase Agreement, dated as of January 31, 2024
Date of Certificate: May 12, 2024
RECITALS
Reference is hereby made to that certain Equity Purchase Agreement (the "EPA"), dated as of January 31, 2024, by and among:
(i) Ardent Capital Partners III LP, a Delaware limited partnership (the "Buyer");
(ii) Pinnacle Health Systems, Inc., a Delaware corporation (the "Company");
(iii) Veltrano Equity Holdings LLC, a Delaware limited liability company, acting through Veltrano Equity Partners Fund V LP, a Delaware limited partnership (the "Seller"); and
(iv) Dr. Marcus Ellsworth and certain other management rollover participants identified on Schedule A to the EPA (collectively, the "Rollover Holders," and together with the Buyer, the Company, and the Seller, the "Parties").
Capitalized terms used but not otherwise defined in this Certificate shall have the respective meanings ascribed to such terms in the EPA.
This Officer's Certificate (this "Certificate") is being delivered by the undersigned on behalf of the Buyer pursuant to Section 6.1(c) of the EPA as a condition precedent to the closing of the transactions contemplated by the EPA (the "Closing"). The Closing is occurring on the date hereof, May 12, 2024, in accordance with Section 2.3 of the EPA and the other terms and conditions set forth therein.
CERTIFICATION
The undersigned hereby certifies the following:
Section 1. Identity and Authority of Certifying Officer
The undersigned, Julian Desmond, hereby certifies that he is a Co-Founder and Managing Partner of Ardent Capital Management LLC, a Delaware limited liability company (EIN: 84-5567312), with its principal offices located at 399 Park Avenue, 41st Floor, New York, New York 10022. Ardent Capital Management LLC is the sole member of Ardent Capital GP III LLC, a Delaware limited liability company (EIN: 86-2198403), which in turn serves as the sole general partner of Ardent Capital Partners III LP, a Delaware limited partnership (EIN: 87-3421098). In his capacity as Co-Founder and Managing Partner of Ardent Capital Management LLC, the undersigned is duly authorized to execute and deliver this Certificate on behalf of Ardent Capital Management LLC, in its capacity as the indirect general partner of the Buyer, pursuant to the governing documents of Ardent Capital Management LLC, the limited liability company agreement of Ardent Capital GP III LLC, and the limited partnership agreement of Ardent Capital Partners III LP. The undersigned has personal knowledge of the facts and matters set forth herein and is competent to certify as to the same.
Section 2. Description of the Transaction
The EPA contemplates the acquisition by Ardent Capital Partners III LP of one hundred percent (100%) of the outstanding equity interests, consisting of all issued and outstanding shares of capital stock, of Pinnacle Health Systems, Inc. (the "Transaction"). Pinnacle Health Systems, Inc. is a corporation organized and existing under the laws of the State of Delaware (EIN: 56-4389201), with its principal place of business located at 2200 Lakeshore Boulevard, Suite 500, Charlotte, North Carolina 28202. The Company is engaged in the business of providing specialty physician practice management services, ambulatory surgical center operations, and ancillary healthcare services across thirteen states. The aggregate enterprise value of the Transaction, as set forth in Section 2.2 of the EPA, is Nine Hundred Fifty-Two Million Dollars ($952,000,000), inclusive of equity consideration, assumed indebtedness, and the estimated rollover value attributable to the Rollover Holders.
The Transaction constitutes an acquisition of voting securities and assets that is subject to the notification and waiting period requirements of the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, 15 U.S.C. § 18a (the "HSR Act"), and the rules and regulations promulgated thereunder by the Federal Trade Commission (the "FTC"), codified at 16 C.F.R. Parts 801–803. As of the date of the EPA, the size-of-transaction and size-of-person thresholds established by the FTC for the 2024 reporting year were satisfied, requiring the filing of premerger notification under the HSR Act prior to consummation of the Transaction.
Section 3. HSR Filing and Notification
On February 16, 2024, in accordance with the requirements of the HSR Act and the rules promulgated thereunder, each of the Buyer and the Company filed its respective Notification and Report Form (the "HSR Filings") with the FTC and the Antitrust Division of the United States Department of Justice (the "DOJ"). The FTC assigned Transaction Number 20241487 to the HSR Filings.
The applicable filing fee of Two Hundred Eighty Thousand Dollars ($280,000) was timely paid by the Buyer through the electronic filing system maintained by the FTC, in accordance with Section 5.4(a) of the EPA, which provides that the Buyer shall bear all filing fees and expenses arising under the HSR Act. The filing fee amount was determined in accordance with the 2024 FTC fee schedule, as adjusted pursuant to Section 605(b) of the Departments of Commerce, Justice, and State, the Judiciary, and Related Agencies Appropriations Act of 1990 (Pub. L. No. 101-162), applicable to transactions with a total value in excess of Five Hundred Million Dollars ($500,000,000) but less than or equal to Nine Hundred Ninety-Nine Million Nine Hundred Thousand Dollars ($999,900,000).
Both the Buyer's and the Company's HSR Filings included, in accordance with the procedures set forth in the FTC's Statement of Basis and Purpose and established agency practice, a request for early termination of the initial thirty (30) calendar day waiting period prescribed by Section 7A(b)(1)(B) of the Clayton Act, as amended by the HSR Act (15 U.S.C. § 18a(b)(1)(B)).
Section 4. Certification of Early Termination
The undersigned hereby certifies, to the best of his knowledge, information, and belief, each of the following:
(a) Grant of Early Termination. The FTC granted early termination of the waiting period applicable to the Transaction on March 8, 2024, pursuant to Early Termination Notice No. 20240683, a true and correct copy of which is attached hereto as Exhibit A and incorporated herein by reference.
(b) Federal Register Publication. The FTC's notice of early termination of the waiting period with respect to the Transaction was published in the Federal Register on March 12, 2024, in accordance with the FTC's customary practice of publishing early termination notices in periodic batches.
(c) Mootness of Initial Waiting Period. The initial thirty (30) calendar day waiting period under Section 7A(b)(1)(B) of the Clayton Act, which would otherwise have expired at 11:59 p.m. Eastern Time on March 17, 2024 (i.e., thirty (30) calendar days following the date on which both HSR Filings were received by the FTC and the DOJ), was rendered moot by the grant of early termination on March 8, 2024, nine (9) days prior to the scheduled expiration of the initial waiting period.
(d) No Second Request. Neither the FTC nor the DOJ issued a request for additional information or documentary material (commonly referred to as a "Second Request") pursuant to Section 7A(e) of the Clayton Act (15 U.S.C. § 18a(e)) in connection with the Transaction. No voluntary access letter, civil investigative demand, or other compulsory process was issued by the FTC, the DOJ, or any other federal or state governmental authority in connection with the review of the Transaction under the HSR Act or any other antitrust statute.
(e) No Pending or Threatened Action. As of the date hereof, no action, suit, proceeding, investigation, or inquiry has been commenced, initiated, or, to the knowledge of the undersigned, threatened by the FTC, the DOJ, any state attorney general, or any other governmental authority under the HSR Act, Sections 1 or 2 of the Sherman Antitrust Act of 1890 (15 U.S.C. §§ 1–2), Section 7 of the Clayton Act (15 U.S.C. § 18), Section 5 of the Federal Trade Commission Act (15 U.S.C. § 45), or any other applicable federal or state antitrust, competition, or unfair trade practices law, seeking to enjoin, restrain, prohibit, condition, or otherwise prevent consummation of the Transaction or to impose any material limitation on the ability of the Buyer to exercise full rights of ownership with respect to the equity interests of the Company following the Closing.
(f) No Remedial Requirements. No consent decree, consent order, hold-separate agreement, hold-separate order, timing agreement, divestiture requirement, behavioral remedy, structural remedy, or any other condition, commitment, undertaking, or restriction of any kind was required by, or agreed to with, the FTC, the DOJ, or any other governmental authority as a condition to or in connection with the clearance of the Transaction under the HSR Act or any other applicable antitrust law. The grant of early termination was unconditional in all respects.
Section 5. Satisfaction of Section 6.1(c) Closing Condition
Based on the foregoing certifications, the undersigned hereby certifies that the condition to the Closing set forth in Section 6.1(c) of the EPA — which provides, in relevant part, that "[t]he applicable waiting period (and any extension thereof) under the HSR Act shall have expired or been terminated" — has been fully and unconditionally satisfied as of the date hereof. The early termination of the applicable waiting period under the HSR Act occurred on March 8, 2024, and no event or circumstance has occurred since such date that would cause the waiting period to recommence or that would otherwise require additional filings, notifications, or consents under the HSR Act or any other federal antitrust statute in connection with the consummation of the Transaction on the date hereof.
No further action, filing, notification, or consent under the HSR Act or any other federal or state antitrust statute is required in connection with the consummation of the Transaction, and the Buyer is not aware of any facts or circumstances that would reasonably be expected to give rise to any such requirement.
Section 6. Reliance and Disclaimer
This Certificate is being delivered solely for purposes of satisfying the condition to Closing set forth in Section 6.1(c) of the EPA and shall not be deemed to constitute a representation, warranty, or certification for any other purpose. This Certificate may be relied upon by (a) each of the Parties to the EPA, (b) their respective legal counsel, (c) any title company, escrow agent, or paying agent acting in connection with the Closing, and (d) any lender or financing source providing debt financing in connection with the Transaction, in each case solely in connection with the consummation of the Closing.
This Certificate does not constitute an opinion of counsel or a legal conclusion regarding any antitrust or competition law matter, whether federal, state, or foreign, beyond the specific certifications expressly set forth herein. Nothing in this Certificate shall be construed to modify, amend, supplement, or waive any representation, warranty, covenant, or agreement contained in the EPA, and the representations and warranties set forth in the EPA shall not be affected or deemed modified by the delivery of this Certificate.
Section 7. Governing Law
This Certificate shall be governed by and construed in accordance with the laws of the State of Delaware, without giving effect to any choice or conflict of law provision or rule (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, consistent with Section 9.8 of the EPA.
IN WITNESS WHEREOF, the undersigned has duly executed this Officer's Certificate as of May 12, 2024.
ARDENT CAPITAL PARTNERS III LP
By: Ardent Capital GP III LLC, its General Partner
By: Ardent Capital Management LLC, its Sole Member
By: ________
Name: Julian Desmond
Title: Co-Founder & Managing Partner
Date: May 12, 2024
Address for Notices:
Ardent Capital Management LLC 399 Park Avenue, 41st Floor New York, New York 10022
Attention: Julian Desmond, Co-Founder & Managing Partner
Email: jdesmond@ardentcapital.com
EXHIBIT A
FTC Early Termination Grant Notice Early Termination Notice No. 20240683 Transaction No. 20241487 Received March 8, 2024
[Copy of Early Termination Notice attached hereto]
This Certificate was prepared by Calderwood & Harkness LLP (Matter No. 1001-00001), antitrust counsel to Ardent Capital Partners III LP, 600 Lexington Avenue, New York, New York 10022.

OFFICER'S CERTIFICATE

RECITALS

CERTIFICATION

ARDENT CAPITAL PARTNERS III LP

EXHIBIT A

Record

Parties

Dates

Amounts