CODE OF BUSINESS CONDUCT AND ETHICS
OF
ARBOR HEALTH TECHNOLOGIES INC.
A Delaware Corporation
NYSE Ticker Symbol: ARHT
275 Kendall Avenue, Suite 1400 Cambridge, Massachusetts 02142
Adopted by the Board of Directors on February 8, 2024
Effective upon the closing of the initial public offering of common stock of Arbor Health Technologies Inc. on the New York Stock Exchange on February 13, 2024
Applicable to all employees, officers, and directors of Arbor Health Technologies Inc. and its subsidiaries
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I. INTRODUCTION AND PURPOSE
A. Purpose of the Code
This Code of Business Conduct and Ethics (this "Code") sets forth the standards of ethical business conduct expected of all Covered Persons (as defined in Section I.B below) of Arbor Health Technologies Inc. ("Arbor Health," "AHT," or the "Company"), a corporation organized and existing under the laws of the State of Delaware. The Code is designed to promote honest and ethical conduct, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships; full, fair, accurate, timely, and understandable disclosure in reports and documents that the Company files with, or submits to, the Securities and Exchange Commission (the "SEC") and in other public communications made by the Company; compliance with applicable governmental laws, rules, and regulations; the prompt internal reporting of violations of this Code; and accountability for adherence to this Code.
Arbor Health operates a proprietary cloud-based clinical decision support and population health management platform (the "Arbor Platform"), serving over 1,200 hospital systems and physician groups across 42 states in the United States. In addition, the Company provides revenue cycle management outsourcing services and related healthcare technology solutions to its customer base. The Company's reputation and success depend fundamentally on maintaining the highest ethical standards in all of its business operations, relationships, and dealings. The trust that our hospital system and physician group customers, their patients, our stockholders, and our employees place in us is one of the Company's most valuable assets, and each of us bears responsibility for preserving and enhancing that trust through ethical conduct.
This Code was adopted by the Board of Directors (the "Board") of Arbor Health effective upon the Company's initial public offering (the "IPO") of common stock on the New York Stock Exchange (the "NYSE") under the ticker symbol ARHT, in connection with the Company's obligations as a publicly listed company. In adopting this Code, the Board recognizes its responsibility to foster a culture of integrity, transparency, and accountability that will serve the Company, its stockholders, and all stakeholders well as Arbor Health enters this new chapter as a public company.
This Code has been adopted in compliance with Section 303A.10 of the NYSE Listed Company Manual, which requires each listed company to adopt and disclose a code of business conduct and ethics for directors, officers, and employees. This Code also addresses the requirements of Section 406 of the Sarbanes-Oxley Act of 2002 and the rules promulgated thereunder by the SEC applicable to codes of ethics for senior financial officers. This Code is not intended to be a comprehensive guide to all of the Company's policies and procedures, and it should be read in conjunction with the Company's other policies referenced in Section XV.B below.
B. Covered Persons
This Code applies to all directors, officers, and employees of Arbor Health and its subsidiaries, wherever located. As used in this Code, "Covered Persons" includes, without limitation:
• All members of the Board of Directors, including the Chairman and Chief Executive Officer, Dr. Nathaniel Rourke; Co-Founder and Chief Technology Officer, Margaret Tsujimoto; and the Company's independent directors;
• All officers of the Company, including the Chairman and Chief Executive Officer, Dr. Nathaniel Rourke; the Co-Founder and Chief Technology Officer, Margaret Tsujimoto; the Chief Financial Officer, David Halderman; the General Counsel and Corporate Secretary, Rachel Moynihan; the Chief Medical Officer, Dr. Priya Subramanian; and all other officers appointed by the Board from time to time;
• All employees of Arbor Health and its direct and indirect subsidiaries, regardless of position, location, or tenure. As of December 31, 2023, the Company employed approximately 3,400 employees across its operations.
In addition, the Company expects that all contractors, consultants, temporary workers, agents, and other third parties acting on the Company's behalf will adhere to the principles and standards set forth in this Code. To the extent practicable, the Company will include provisions in its agreements with such parties requiring compliance with the applicable principles of this Code.
All of the foregoing are collectively referred to herein as "Covered Persons."
C. Compliance with Laws, Rules, and Regulations
It is the Company's policy, and the personal responsibility of each Covered Person, to comply with all applicable federal, state, local, and foreign laws, rules, and regulations. Compliance with the law is the foundation on which the Company's ethical standards are built. No Covered Person has the authority to violate any applicable law on behalf of the Company, and no business objective—no matter how important—justifies a violation of law.
Given the nature of the Company's business, Covered Persons should be particularly attentive to compliance with the following categories of laws and regulations, among others:
• Securities Laws. The Securities Act of 1933, as amended, the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and the rules and regulations promulgated thereunder by the SEC, including regulations governing insider trading, the filing of periodic reports, proxy solicitations, and public disclosure obligations. As a newly public company listed on the NYSE, Arbor Health is subject to extensive securities law requirements, and compliance with these requirements is critical to maintaining the confidence of investors and the integrity of the public markets.
• Healthcare Regulatory Requirements. The Health Insurance Portability and Accountability Act of 1996, as amended ("HIPAA"), including the Privacy Rule and the Security Rule; the Health Information Technology for Economic and Clinical Health Act ("HITECH"); the federal Anti-Kickback Statute (42 U.S.C. § 1320a-7b(b)); the Physician Self-Referral Law (commonly known as the "Stark Law") (42 U.S.C. § 1395nn); the federal False Claims Act (31 U.S.C. § 3729 et seq.); and applicable state healthcare laws and regulations. The Company's SaaS platform and revenue cycle management outsourcing services operate in a highly regulated healthcare environment, and strict compliance with healthcare laws is essential to the Company's continued ability to serve its customers and their patients.
• Data Privacy and Cybersecurity Laws. Federal and state data privacy and cybersecurity laws, including HIPAA and HITECH, applicable state data breach notification laws, and other regulations governing the collection, use, storage, transmission, and protection of personal information and protected health information.
• Employment and Labor Laws. Federal, state, and local employment and labor laws, including Title VII of the Civil Rights Act of 1964, the Americans with Disabilities Act, the Family and Medical Leave Act, the Fair Labor Standards Act, the Occupational Safety and Health Act, and state and local equivalents.
• Anti-Corruption Laws. The U.S. Foreign Corrupt Practices Act, federal and state bribery statutes, and other applicable anti-corruption laws.
• Antitrust and Competition Laws. The Sherman Antitrust Act, the Clayton Act, the Federal Trade Commission Act, and applicable state antitrust laws.
Covered Persons who are uncertain about the legal requirements applicable to their work, or who have questions about whether a particular course of action would comply with applicable law, should seek guidance from the General Counsel, Rachel Moynihan, or the Compliance Department before taking action. The failure to seek guidance will not excuse a violation of law.
II. CONFLICTS OF INTEREST
A. Definition. A conflict of interest exists when a Covered Person's private interest interferes, or reasonably appears to interfere, with the interests of the Company as a whole. A conflict of interest can arise whenever a Covered Person takes action or has an interest that may make it difficult for the Covered Person to perform his or her duties and responsibilities to the Company objectively and effectively. Conflicts of interest may also arise when a Covered Person, or a member of his or her immediate family (including a spouse, domestic partner, parent, child, sibling, or any person sharing the Covered Person's household), receives an improper personal benefit as a result of the Covered Person's position at Arbor Health.
Not every situation involving a potential conflict of interest will be clear-cut. Covered Persons are expected to exercise good judgment and, when in doubt, to disclose the situation and seek guidance in accordance with the procedures described below. Even the appearance of a conflict of interest can be damaging to the Company and should be avoided.
B. Examples of Conflicts
While it is not possible to identify every situation that could give rise to a conflict of interest, the following are examples of situations that may create actual or potential conflicts of interest:
• Financial Interests in Competitors, Customers, or Suppliers. Having a direct or indirect financial interest in a competitor, customer, or supplier of the Company. For purposes of this Code, ownership of less than one percent (1%) of the outstanding securities of a publicly traded company that is a competitor, customer, or supplier of the Company shall generally not be considered a conflict of interest, provided that such investment does not otherwise affect the Covered Person's judgment or ability to perform his or her duties.
• Outside Employment or Service. Serving as an officer, director, consultant, employee, or advisor of a competitor, customer, or supplier of the Company, or of any other entity whose interests may conflict with those of the Company. This includes service on the board of directors of another company, which for directors and executive officers requires disclosure to and, in certain cases, approval by the Nominating and Corporate Governance Committee or the Board.
• Corporate Opportunities. Taking personal advantage of business opportunities that are discovered through the use of Company property, information, or position, or that are otherwise properly within the scope of the Company's business. This is discussed in more detail in Section II.D below.
• Use of Company Resources. Using Company resources, including the Arbor Platform technology, proprietary data, intellectual property, facilities, equipment, or employee time, for personal benefit or for the benefit of any person or entity other than the Company.
• Loans and Guarantees. Making or receiving loans, guarantees of obligations, or similar financial arrangements involving the Company and any Covered Person. In accordance with Section 402 of the Sarbanes-Oxley Act of 2002, the Company is prohibited from, directly or indirectly, including through any subsidiary, extending or maintaining credit, arranging for the extension of credit, or renewing an extension of credit, in the form of a personal loan to or for any director or executive officer of the Company.
• Pre-IPO Investor Relationships. Relationships or transactions between the Company and its pre-IPO investors, including Brindoval Trelvon Partners, L.P. ("Brindoval Summit") and Ridgeline Growth Equity, LLC ("Ridgeline Growth"), or their respective affiliates, portfolio companies, or managed funds, that are not conducted on arm's-length terms or that are not otherwise in the best interests of the Company and its stockholders. The Company recognizes that its pre-IPO investor relationships create the potential for conflicts and will manage these relationships with appropriate oversight and transparency.
• Family Member Relationships. Situations in which a member of a Covered Person's immediate family has a business relationship with, or a financial interest in, a competitor, customer, or supplier of the Company that could influence or appear to influence the Covered Person's judgment in carrying out his or her responsibilities.
C. Disclosure and Approval Requirements
All actual or potential conflicts of interest must be promptly disclosed. The Company has established the following procedures for the disclosure, review, and approval of conflicts of interest:
• General Employees. All actual or potential conflicts of interest involving employees (other than executive officers) must be promptly disclosed in writing to the General Counsel, Rachel Moynihan, who, together with the Compliance Department, will evaluate the matter and determine an appropriate course of action.
• Executive Officers. All actual or potential conflicts of interest involving executive officers of the Company (including the Chairman and CEO, CFO, General Counsel, CTO, CMO, and any other officer designated as an executive officer by the Board) must be disclosed to the Audit Committee of the Board, which is chaired by Carolyn Whittemore. The Audit Committee will evaluate the matter and determine whether the conflict should be approved, conditionally approved, or prohibited, and will report its determination to the full Board as appropriate.
• Directors. All actual or potential conflicts of interest involving directors must be disclosed to the full Board of Directors. Depending on the nature of the conflict, the matter may also be referred to the Nominating and Corporate Governance Committee, chaired by Leonard marsh, for review and recommendation. A director with a conflict of interest shall recuse himself or herself from any Board or committee deliberation or vote relating to the matter giving rise to the conflict.
• Related Party Transactions. Related party transactions involving the Company and any director, executive officer, holder of more than five percent (5%) of the Company's outstanding common stock, or any immediate family member of any of the foregoing, are subject to the Company's Related Party Transaction Policy, which has been adopted by the Board in connection with the IPO. Such transactions will be reviewed and approved or ratified by the Audit Committee in accordance with the standards and procedures set forth in that policy, consistent with Item 404 of Regulation S-K under the Securities Act. The Company will disclose all related party transactions as required by applicable SEC rules and regulations.
D. Corporate Opportunities
Covered Persons owe a duty of loyalty to the Company that includes the obligation not to divert for personal benefit business opportunities that properly belong to the Company. Accordingly, Covered Persons are prohibited from:
• Taking for themselves personally any business opportunities that are discovered through the use of Company property, information, or position;
• Using Company property, information, or position for personal gain;
• Competing with the Company, directly or indirectly, for business opportunities.
If a Covered Person becomes aware of a potential business opportunity that may be within the scope of the Company's existing or reasonably anticipated future business, the Covered Person must first present such opportunity to the Company. The Covered Person may pursue such opportunity only after the Board of Directors or a designated committee thereof has been informed of the opportunity and has declined to pursue it on behalf of the Company.
The duty to present corporate opportunities to the Company applies with particular force to directors who are designees of the Company's pre-IPO investors. Specifically, the following directors have been designated to the Board by the Company's pre-IPO investors: Leonard marsh and Diana Coltrane, each designated by Brindoval Trelvon Partners, L.P.; and Howard Feng, designated by Ridgeline Growth Equity, LLC. These directors are reminded that, notwithstanding their relationships with their respective sponsoring investors, they owe fiduciary duties to the Company and its stockholders as a whole, and they must present to the Company any corporate opportunity that comes to their attention through their service as directors of the Company. The Company's Amended and Restated Certificate of Incorporation, filed with the Delaware Secretary of State on February 13, 2024, contains provisions addressing the allocation of certain corporate opportunities between the Company and its pre-IPO investors, as permitted by Section 122(17) of the Delaware General Corporation Law, and Covered Persons should consult with the General Counsel regarding the application of those provisions to specific circumstances.
III. CONFIDENTIALITY AND PROTECTION OF COMPANY INFORMATION
A. Confidential Information
Covered Persons have an obligation to protect all confidential information of the Company. During the course of their employment or service, Covered Persons will have access to a wide range of confidential and proprietary information that is critical to the Company's competitive position and business success. "Confidential information" includes, but is not limited to:
• Trade secrets and proprietary technology, including the Arbor Platform clinical decision support and population health management technology, its underlying software code, algorithms, analytics methodologies, machine learning models, data architectures, and related technical documentation;
• Patient data and protected health information processed, stored, or transmitted through the Arbor Platform or in connection with the Company's revenue cycle management services;
• Customer lists, customer contracts, customer pricing and deal terms, and customer relationship information relating to the Company's more than 1,200 hospital system and physician group customers;
• Business strategies, marketing plans, product roadmaps, and research and development plans;
• Financial information, including unannounced financial results, budgets, forecasts, projections, and cost structures;
• Pricing methodologies, pricing models, and competitive pricing intelligence;
• Personnel data, including compensation information, performance evaluations, and organizational plans;
• Information relating to pending or contemplated acquisitions, divestitures, partnerships, joint ventures, or other strategic transactions;
• Information relating to pending or threatened litigation, regulatory investigations, or other legal matters; and
• Any other information designated as confidential by the Company.
The obligation to protect confidential information continues even after a Covered Person's employment or service with the Company has terminated. Former employees, officers, and directors remain bound by their obligations of confidentiality with respect to information obtained during their tenure. The Company takes seriously its intellectual property rights and will enforce its contractual and legal protections against unauthorized use or disclosure of confidential information.
The Company's intellectual property, including software code, algorithms, analytics methodologies, and data science innovations developed by the technology team under the leadership of Chief Technology Officer Margaret Tsujimoto, represents years of significant investment and is central to the Company's competitive advantage. All Covered Persons must exercise particular care to protect the Company's intellectual property from unauthorized disclosure, misappropriation, or misuse.
B. Use of Confidential Information
Confidential information may be used only for legitimate Company purposes and only in accordance with any applicable Company policies and procedures governing the handling and protection of such information. Specific restrictions include the following:
• Confidential information may not be shared with any person outside the Company, including family members, friends, and acquaintances, unless such sharing is authorized by the General Counsel or is required by applicable law, regulation, or legal process, such as a valid subpoena, court order, or regulatory request. In the event that a Covered Person receives a legal request for the production of Company confidential information, the Covered Person must promptly notify the General Counsel before making any disclosure.
• Confidential information may not be used for personal benefit or for the benefit of any person or entity other than the Company. This includes, without limitation, using confidential information to trade in Company securities or the securities of any other company (as further described in Section IV below) or to further any outside business interest.
• Covered Persons must exercise care to prevent the inadvertent disclosure of confidential information, including by safeguarding documents and electronic files, using appropriate security measures when working remotely or in public settings, and being mindful of discussions in public places where confidential information might be overheard.
Special care is required with respect to protected health information ("PHI") as defined under HIPAA and the HITECH Act. The Company's cloud-based platform and revenue cycle management services involve the processing, storage, and transmission of significant volumes of PHI belonging to the patients of the Company's hospital system and physician group customers. All Covered Persons who handle, access, or are exposed to PHI must comply with the Company's HIPAA Privacy and Security Policies, the terms of any applicable Business Associate Agreements between the Company and its customers, and all applicable federal and state health information privacy laws and regulations. Unauthorized access to, use of, or disclosure of PHI is strictly prohibited and may result in disciplinary action by the Company as well as civil and criminal penalties under applicable law.
C. Third-Party Confidential Information
The Company's relationships with its customers, suppliers, partners, and other third parties frequently involve the exchange of confidential information. Covered Persons have an obligation to respect and protect the confidential information of third parties with the same care they apply to the Company's own confidential information. Covered Persons must comply with all confidentiality agreements, non-disclosure agreements, and other contractual obligations governing third-party confidential information, including the terms of the Company's customer agreements with hospital systems and physician groups.
In addition, Covered Persons are prohibited from acquiring the confidential information of competitors through improper means, including theft, bribery, misrepresentation, electronic eavesdropping, or the solicitation of current or former employees of competitors to disclose their former employer's confidential information. If a Covered Person comes into possession of a competitor's confidential information, the Covered Person should promptly contact the General Counsel for guidance on how to handle the situation.
D. Public Communications and Social Media
Arbor Health is committed to providing full, fair, accurate, timely, and understandable disclosure in its public communications, including its filings with the SEC, press releases, and other public statements. To ensure the accuracy and consistency of public communications, only authorized spokespersons may make public communications on behalf of the Company. Authorized spokespersons include the Chairman and CEO, Dr. Nathaniel Rourke; the Chief Financial Officer, David Halderman; the General Counsel and Corporate Secretary, Rachel Moynihan; and such other persons as may be designated by them from time to time.
All other Covered Persons are prohibited from speaking on behalf of the Company with the media, analysts, investors, or other members of the public without prior authorization from one of the authorized spokespersons. Covered Persons must not discuss Company business, financial results, prospects, operations, customers, technology, or any other material non-public information on social media platforms, online forums, chat rooms, message boards, blogs, or with members of the press, without prior authorization.
As a newly public company, Arbor Health is subject to SEC Regulation FD (Fair Disclosure), which prohibits the selective disclosure of material non-public information to certain securities market professionals and stockholders. A violation of Regulation FD can occur even through an inadvertent disclosure of material non-public information. All Covered Persons must exercise caution to avoid inadvertent disclosures that could trigger Regulation FD obligations and should direct all inquiries from analysts, investors, or the media to the authorized spokespersons identified above.
IV. INSIDER TRADING AND SECURITIES LAW COMPLIANCE
A. Prohibition on Insider Trading
Federal securities laws, including Section 10(b) of the Exchange Act and Rule 10b-5 promulgated thereunder, prohibit the purchase or sale of securities while in possession of material non-public information ("MNPI") about the issuer of those securities. These laws also prohibit the communication (or "tipping") of MNPI to any person who may trade on the basis of that information. Violations of insider trading laws can result in severe civil and criminal penalties, including substantial fines and imprisonment.
Accordingly, Covered Persons who possess MNPI about the Company are strictly prohibited from:
• Purchasing or selling Arbor Health securities, including common stock (ticker ARHT, listed on the NYSE, CUSIP 039217105), options, warrants, or any other derivative securities related to Company common stock, while in possession of such MNPI;
• Recommending or suggesting that any other person purchase or sell Arbor Health securities while the Covered Person is in possession of MNPI;
• Communicating MNPI to any other person, whether inside or outside the Company, who does not have a legitimate need to know the information for the purpose of carrying out Company business, including family members, friends, business associates, investment advisors, or any other person (commonly known as "tipping"); and
• Purchasing or selling the securities of any other company (including the Company's customers, suppliers, partners, or potential acquisition targets) while in possession of MNPI about that company obtained through the Covered Person's work at Arbor Health.
The prohibition on insider trading applies to all Covered Persons and extends to all transactions in Company securities, including open market purchases and sales, exercises of stock options, sales of shares received upon vesting of restricted stock units ("RSUs"), and transactions in Company 401(k) plan accounts to the extent they involve Company stock.
B. Definition of Material Non-Public Information
Information is "material" if there is a substantial likelihood that a reasonable investor would consider it important in making an investment decision, or if the information would be viewed as significantly altering the "total mix" of information available to investors. Both positive and negative information can be material.
Examples of information that would ordinarily be considered material include, but are not limited to:
• Unannounced financial results, including quarterly and annual revenue, earnings, or losses;
• Earnings estimates, revenue projections, or guidance, whether issued by the Company or developed internally;
• Significant customer wins or losses, including the signing or termination of contracts with major hospital systems or physician groups;
• Planned or pending mergers, acquisitions, divestitures, joint ventures, or other strategic transactions;
• Changes in senior management or the Board of Directors;
• Pending or threatened litigation, government investigations, or regulatory actions that could have a material impact on the Company;
• Cybersecurity incidents, data breaches, or material failures of the Arbor Platform;
• Planned equity or debt offerings, stock buybacks, or changes to the Company's capital structure;
• Material changes in the Company's business strategy, product roadmap, or competitive position;
• Significant changes in the Company's relationships with its pre-IPO investors or their designees; and
• The declaration or omission of dividends or other distributions.
Information is "non-public" until it has been adequately disseminated to the public and sufficient time has elapsed for the market to absorb the information. Information is generally considered public after it has been filed with the SEC (e.g., in a Form 10-K, Form 10-Q, or Form 8-K), issued in a Company press release distributed through a widely available news service, or otherwise broadly disseminated to the investing public. As a general guideline, information should be considered non-public until at least one full trading day after public disclosure.
C. Trading Windows and Blackout Periods
The Company has adopted an Insider Trading Policy (a separate document maintained by the General Counsel) that establishes quarterly trading blackout periods and pre-clearance procedures for directors, officers, and other designated insiders (collectively, "Insiders"). All Insiders are required to comply with the Insider Trading Policy, which, among other things:
• Imposes quarterly blackout periods during which Insiders are prohibited from trading in Company securities, generally beginning on the fifteenth (15th) day of the last month of each fiscal quarter and ending after one full trading day following the Company's public announcement of financial results for that quarter;
• Requires Insiders to obtain pre-clearance from the General Counsel (or the General Counsel's designee) before engaging in any transaction in Company securities, even during open trading windows; and
• Establishes additional restrictions and procedures as may be necessary from time to time to address specific circumstances, including event-specific blackout periods in connection with material corporate events.
Directors and officers are encouraged to adopt written trading plans under Rule 10b5-1 of the Exchange Act to facilitate the orderly trading of Company securities in accordance with SEC requirements. All Rule 10b5-1 plans must be pre-cleared by the General Counsel and must comply with the cooling-off periods and other requirements applicable to such plans under SEC rules. The adoption, modification, and termination of Rule 10b5-1 plans by directors and officers will be disclosed in the Company's periodic filings with the SEC as required by applicable rules. Certain pre-existing Rule 10b5-1 plans for Dr. Nathaniel Rourke and Margaret Tsujimoto were disclosed in the Company's Registration Statement on Form S-1 (SEC File Number 333-276841) and remain in effect as of the date of this Code, subject to the terms described therein.
D. Lock-Up Obligations
All directors, officers, and holders of one percent (1%) or more of the Company's pre-IPO shares (approximately 45 individuals and entities, covering approximately 80,000,000 pre-IPO shares) are subject to lock-up agreements (the "Lock-Up Agreements") entered into in connection with the IPO. The Lock-Up Agreements provide for a 180-day lock-up period from the date of the final prospectus filed in connection with the IPO (February 8, 2024), expiring on August 6, 2024, during which the locked-up parties are prohibited from, among other things, offering, pledging, selling, granting options on, or otherwise disposing of or transferring shares of common stock or securities convertible into or exchangeable for shares of common stock, without the prior written consent of Whitfield Barrow & Co., LLC, as Representative of the underwriters.
Covered Persons subject to the Lock-Up Agreements must comply with the terms of those agreements in addition to this Code and the Company's Insider Trading Policy. Limited exceptions to the Lock-Up Agreements are available, including:
• Transfers for bona fide estate planning purposes, including transfers to trusts for the benefit of the locked-up party or his or her immediate family members, subject to lock-up continuation requirements;
• Transactions under pre-existing Rule 10b5-1 trading plans that were disclosed in the Company's Registration Statement on Form S-1;
• Open market purchases of common stock occurring after the closing of the IPO;
• Surrenders or withholding of shares to satisfy tax withholding obligations arising from the vesting of RSUs, in an amount not to exceed ten percent (10%) of the locked-up party's total locked-up shares; and
• Other exceptions as specified in the Lock-Up Agreements.
These exceptions do not relieve Covered Persons from their obligations under applicable insider trading laws, this Code, or the Company's Insider Trading Policy. Covered Persons with questions regarding the Lock-Up Agreements should consult with the General Counsel.
E. Section 16 Reporting
Directors and executive officers of the Company are "Section 16 insiders" under Section 16 of the Exchange Act and are subject to specific reporting obligations, including:
• Form 3 (Initial Statement of Beneficial Ownership). Must be filed within ten (10) days of becoming a director or executive officer.
• Form 4 (Statement of Changes in Beneficial Ownership). Must be filed within two (2) business days of most transactions in Company securities, including purchases, sales, grants of equity awards, exercises of options, and vesting of RSUs.
• Form 5 (Annual Statement of Beneficial Ownership). Must be filed within 45 days after the end of the Company's fiscal year for any transactions or holdings not previously reported on Form 3 or Form 4, unless the Company has checked the applicable box on its Annual Report on Form 10-K indicating that no Form 5 filings are required.
Section 16 insiders are also subject to the "short-swing profit" recovery provisions of Section 16(b) of the Exchange Act, which require the disgorgement to the Company of any profits realized from a purchase and sale, or sale and purchase, of Company equity securities within any six-month period.
The General Counsel's office will assist Section 16 insiders with their filing obligations, including the preparation and filing of Forms 3, 4, and 5. However, the obligation to file accurate and timely reports with the SEC remains the personal responsibility of each Section 16 insider. Section 16 insiders are required to promptly notify the General Counsel of all transactions in Company securities.
V. FAIR DEALING AND HONEST BUSINESS PRACTICES
A. Fair Dealing
Covered Persons must deal honestly, fairly, and in good faith with the Company's customers, suppliers, competitors, employees, and business partners. The Company's long-term success depends on its reputation for integrity in all of its dealings. Covered Persons must not take unfair advantage of anyone through manipulation, concealment, abuse of privileged information, misrepresentation of material facts, or any other unfair dealing practice. This obligation applies to all aspects of the Company's business, including the marketing and sale of the Arbor Platform and revenue cycle management services, the negotiation of contracts, the procurement of goods and services, and the Company's interactions with regulators and other governmental authorities.
Each Covered Person should endeavor to deal with the Company's customers, suppliers, competitors, and other third parties in the same fair and honest manner in which the Covered Person would wish to be dealt with. No Covered Person should take unfair advantage of another through false or misleading statements, coercion, or any other form of dishonest dealing.
B. Competition and Antitrust
The Company is committed to complying fully with all applicable antitrust and competition laws. These laws are designed to promote vigorous and fair competition and to protect consumers and market participants from anti-competitive conduct. Violations of antitrust laws can result in severe consequences for the Company and for individual Covered Persons, including substantial criminal and civil penalties.
Covered Persons are strictly prohibited from engaging in the following types of conduct with competitors:
• Agreements or understandings, whether express or implied, formal or informal, to fix prices, rig bids, allocate markets or customers, or restrict output;
• Exchanges of competitively sensitive information with competitors, including information regarding prices, pricing strategies, costs, profit margins, market share, customer terms, or business plans; and
• Any other agreements or coordinated actions with competitors that unreasonably restrain trade.
Particular care is required given that Arbor Health holds a significant market position, serving over 1,200 hospital systems and physician groups across 42 states. The Company's prominence in the clinical decision support and population health management market means that its conduct will be subject to heightened scrutiny. Covered Persons should exercise caution when interacting with competitors, including at industry conferences, trade association meetings, and other professional gatherings, and should avoid any discussions or exchanges of information that could be construed as anti-competitive. Covered Persons with questions about the applicability of antitrust laws to a particular situation should consult the General Counsel before proceeding.
C. Customer and Vendor Relationships
All business decisions regarding the selection, retention, and management of customers and vendors must be based on objective criteria, including merit, quality, service, reliability, and price. The Company's procurement process is designed to be fair, transparent, and competitive.
Covered Persons are prohibited from engaging in commercial bribery—that is, giving or receiving kickbacks, bribes, or other improper payments to or from customers, vendors, government officials, or any other party in order to obtain or retain business, influence a business decision, or secure an unfair advantage. This prohibition extends to direct payments as well as indirect payments made through third-party intermediaries, agents, or consultants. For additional guidance on anti-corruption and anti-bribery obligations, Covered Persons should refer to Section VI of this Code.
VI. ANTI-CORRUPTION AND ANTI-BRIBERY
A. U.S. Foreign Corrupt Practices Act (FCPA) and Domestic Anti-Bribery Laws
The Company strictly prohibits bribery and corruption in all of its business activities. No Covered Person shall, directly or indirectly, offer, promise, authorize, or make any payment of money or anything of value to any government official, government employee, political party, party official, or candidate for political office for the purpose of:
• Influencing any act or decision of such person in his or her official capacity;
• Inducing such person to do or omit to do any act in violation of his or her lawful duties;
• Obtaining or retaining business or directing business to any person; or
• Securing any improper advantage.
This prohibition applies to payments made directly by Covered Persons as well as payments made indirectly through agents, consultants, distributors, joint venture partners, or any other third-party intermediaries. The Company is subject to the U.S. Foreign Corrupt Practices Act (the "FCPA"), which prohibits the payment of bribes to foreign government officials, as well as to federal and state domestic bribery statutes that prohibit corrupt payments to domestic government officials and employees. To the extent that Arbor Health engages in any international activities, whether directly or through partners or agents, compliance with the FCPA and applicable foreign anti-corruption laws is mandatory.
For purposes of this Code, "government officials" includes not only elected officials and government employees, but also employees of government-owned or government-controlled entities (including government-owned hospitals and healthcare systems), public international organizations, and any person acting in an official capacity on behalf of a governmental body.
B. Healthcare-Specific Anti-Corruption Compliance
Given the Company's operations in the healthcare industry, Covered Persons must be particularly attentive to compliance with federal and state healthcare anti-corruption laws. These laws impose strict prohibitions on certain types of financial relationships and referral arrangements in the healthcare sector.
• The Federal Anti-Kickback Statute (42 U.S.C. § 1320a-7b(b)). The Anti-Kickback Statute makes it a criminal offense to knowingly and willfully offer, pay, solicit, or receive any remuneration (including any kickback, bribe, or rebate), directly or indirectly, overtly or covertly, in cash or in kind, in exchange for or to induce the referral of an individual for, or the purchasing, leasing, ordering, or arranging for the purchase, lease, or ordering of, any good, facility, service, or item for which payment may be made in whole or in part under a federal healthcare program, including Medicare and Medicaid. The Anti-Kickback Statute is broadly interpreted and can apply to a wide range of business arrangements and financial relationships.
• The Physician Self-Referral Law (Stark Law) (42 U.S.C. § 1395nn). The Stark Law prohibits a physician from making referrals for certain designated health services payable by Medicare or Medicaid to an entity with which the physician (or an immediate family member) has a financial relationship, unless an applicable exception is met.
• The Federal False Claims Act (31 U.S.C. § 3729 et seq.). The False Claims Act imposes civil liability on any person who knowingly submits, or causes to be submitted, a false or fraudulent claim for payment to the federal government. Violations of the Anti-Kickback Statute or the Stark Law can give rise to liability under the False Claims Act.
Covered Persons must ensure that the Company's relationships with hospital systems, physician groups, healthcare providers, and other healthcare customers are structured in compliance with these laws and any applicable regulatory safe harbors and exceptions. Particular attention must be paid to the terms and structure of customer agreements for the Arbor Platform and revenue cycle management services, including pricing arrangements, fee structures, volume discounts, and any complementary services or support provided to customers. Covered Persons with questions about whether a particular arrangement may implicate healthcare anti-corruption laws should consult with the General Counsel or the Compliance Department before entering into any such arrangement.
C. Gifts, Entertainment, and Hospitality
Reasonable and customary business gifts and entertainment can foster goodwill and strengthen business relationships. However, gifts and entertainment can also create the appearance of improper influence or conflicts of interest. The Company has adopted a Gifts and Entertainment Policy (maintained separately by the Compliance Department) that establishes specific guidelines and limits on the giving and receiving of gifts, entertainment, and hospitality.
The following general principles apply to all gifts, entertainment, and hospitality:
• Gifts and entertainment must not be offered, given, or received with the intent to improperly influence a business decision or to create an obligation on the part of the recipient;
• Gifts and entertainment must be reasonable in value, infrequent, and consistent with customary business practices;
• Gifts and entertainment must not violate any applicable law, regulation, or the policies of the recipient's employer;
• Cash or cash-equivalent gifts (such as gift cards) to or from business contacts are prohibited;
• Enhanced scrutiny applies to gifts to or from healthcare professionals, hospital administrators, government officials, and other persons whose decisions may affect the Company's business. Given the Company's status as a healthcare technology provider, many of the Company's business contacts are healthcare professionals whose relationships with industry participants are subject to regulatory oversight; and
• All gifts and entertainment above a de minimis threshold (as established in the Gifts and Entertainment Policy) must be documented and reported to the Compliance Department.
Covered Persons are expected to exercise good judgment and to err on the side of caution when questions arise about the appropriateness of a particular gift or entertainment. When in doubt, Covered Persons should seek guidance from the Compliance Department or the General Counsel.
VII. PROTECTION AND PROPER USE OF COMPANY ASSETS
A. Company Assets
Covered Persons are entrusted with the care and protection of Company assets and are responsible for ensuring that those assets are used efficiently and for legitimate business purposes. Company assets include, but are not limited to:
• Physical assets, including office space, furniture, equipment, computers, mobile devices, and supplies;
• Technology assets, including the Arbor Platform, software, databases, servers, cloud infrastructure, and information systems;
• intellectual property, including patents, patent applications, trademarks, service marks, copyrights, trade secrets, and proprietary know-how;
• Financial assets, including cash, investments, and credit facilities;
• Information assets, including confidential business information, customer data, and employee data; and
• The Company's name, brand, and reputation.
Company assets must be used for legitimate business purposes and not for personal benefit, except for incidental personal use as may be permitted by applicable Company policies. All Covered Persons should protect Company assets against loss, theft, damage, waste, and unauthorized use. The theft, unauthorized use, or deliberate damage of Company assets is prohibited and may result in disciplinary action and, where appropriate, referral to law enforcement authorities.
B. Record-Keeping and Financial Integrity
The Company is committed to maintaining books, records, and accounts that accurately and fairly reflect, in reasonable detail, all transactions and dispositions of assets of the Company, in accordance with United States generally accepted accounting principles ("GAAP") and applicable SEC regulations. Accurate record-keeping and financial reporting are essential to meeting the Company's legal and regulatory obligations as a publicly traded company, maintaining the confidence of investors and stockholders, and supporting sound business decision-making.
The following principles govern the Company's record-keeping and financial reporting:
• No false, misleading, incomplete, or artificial entries may be made in any Company book, record, or account. All entries must accurately reflect the underlying transaction or event.
• All transactions must be properly authorized, executed, and documented in accordance with management's general or specific authorization.
• No payments or receipts may be made or accepted with the intention or understanding that they will be used for any purpose other than that described in the supporting documentation.
• No undisclosed or unrecorded fund or asset may be established for any purpose.
• All financial reports, SEC filings, press releases, and other public disclosures must be full, fair, accurate, timely, and understandable.
The Company's independent registered public accounting firm, Kellerman & Associates LLP, audits the Company's consolidated financial statements and issues reports on the effectiveness of the Company's internal control over financial reporting. The Audit Committee of the Board, consisting of Carolyn Whittemore (Chair), Dr. Samuel Obadina, and Howard Feng, oversees the Company's financial reporting processes, internal controls, and the independent audit. All Covered Persons are expected to support the Audit Committee in fulfilling its oversight responsibilities.
C. Internal Controls
The Company maintains a system of internal accounting controls designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements in accordance with GAAP. The internal control framework is designed to ensure that transactions are executed in accordance with management's authorization, assets are safeguarded, and financial records are maintained with integrity.
All Covered Persons must cooperate fully with the Company's internal audit function and with the Company's external auditors, Kellerman & Associates LLP, in the performance of their audit and review procedures. Covered Persons must provide complete, accurate, and timely information in response to requests from internal or external auditors.
No Covered Person shall take any action to fraudulently influence, coerce, manipulate, or mislead the Company's independent auditors in the performance of their audit or review of the Company's financial statements. Such conduct is a violation of federal law and may result in severe civil and criminal penalties, in addition to disciplinary action by the Company, up to and including termination of employment or removal from the Board.
D. Expense Reporting
All business expenses incurred by Covered Persons must be accurately documented, properly approved by the appropriate supervisor or manager, and submitted in compliance with the Company's expense reimbursement policies and procedures. Expense reports must include appropriate supporting documentation and must accurately describe the nature, purpose, and amount of each expenditure. The submission of false, inflated, or fraudulent expense reports is a violation of this Code and may result in disciplinary action, including termination of employment and, where appropriate, referral to law enforcement authorities.
VIII. DATA PRIVACY AND CYBERSECURITY
A. Privacy Obligations
The Company is committed to protecting the privacy of personal information entrusted to it by patients, customers, employees, and other individuals whose data the Company collects, processes, stores, or transmits in the course of its business operations. The Company recognizes that the protection of personal information is not only a legal obligation but also a core element of the trust that its customers and their patients place in the Arbor Platform and the Company's services.
Covered Persons must comply with all applicable data privacy laws and regulations, including: