1010-00002 · Client 1010 · Lock-Up Agreements

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PRIVILEGED & CONFIDENTIAL ATTORNEY-CLIENT COMMUNICATION

CALDERWOOD & HARKNESS LLP Attorneys at Law

125 Broad Street New York, NY 10004

Telephone: (212) 558-4000 Facsimile: (212) 558-3588

www.calderwoodharkness.com

February 14, 2024

VIA EMAIL AND HAND DELIVERY

Rachel Moynihan, Esq. General Counsel & Corporate Secretary Arbor Health Technologies Inc. 275 Kendall Avenue, Suite 1400 Cambridge, MA 02142

Re: Procedures for Potential Early Release of Lock-Up Restrictions — Arbor Health Technologies Inc. Initial Public Offering of Common Stock (NYSE: ARHT)

Dear Rachel:

We write in connection with the lock-up agreements (each, a "Lock-Up Agreement" and collectively, the "Lock-Up Agreements") executed by approximately forty-five (45) individuals and entities in favor of Whitfield Barrow & Co., LLC, as Representative of the several underwriters (the "Representative" or "Whitfield Barrow"), in connection with the initial public offering (the "IPO") of shares of common stock, par value $0.001 per share (the "Common Stock"), of Arbor Health Technologies Inc. (the "Company" or "AHT"), which closed on February 13, 2024. Capitalized terms used but not otherwise defined herein shall have the meanings ascribed to them in the Underwriting Agreement, dated February 8, 2024, among the Company, the Representative, Calloway Pierce Securities LLC, Velthorn Capital Partners Inc., and Pemberton Wallis LLC (collectively, the "Underwriters").

The purpose of this letter is to establish clear internal procedures for the Company to follow should any party to a Lock-Up Agreement (each, a "Lock-Up Party") request an early release from the restrictions contained in such Lock-Up Party's Lock-Up Agreement at any point during the 180-day lock-up period (the "Lock-Up Period"). As discussed more fully below, the Lock-Up Period commenced on February 8, 2024, the date of the final prospectus filed with the Securities and Exchange Commission (the "SEC") pursuant to Rule 424(b) under the Securities Act of 1933, as amended (the "Securities Act"), and the pricing date of the IPO, and is currently scheduled to expire on August 6, 2024.

The shares of Common Stock subject to the Lock-Up Agreements total approximately 80,000,000 shares, representing all pre-IPO outstanding shares and constituting approximately 77.67% of the 103,000,000 shares of Common Stock outstanding on a post-IPO basis. The proper management of any early release request during the Lock-Up Period is critical to maintaining market confidence in the Company's Common Stock, preserving the Company's relationships with the Underwriters, ensuring compliance with applicable federal securities laws and regulations (including the rules of the Financial Industry Regulatory Authority ("FINRA")), and promoting the orderly trading of AHT Common Stock on the New York Stock Exchange.

We strongly recommend that the Company adopt and implement the procedures set forth in this letter at the earliest practicable opportunity.

I. Summary of Lock-Up Terms

A. Lock-Up Period and Scope

The Lock-Up Agreements impose a 180-day restriction period that commenced on February 8, 2024 (the pricing date of the IPO and the date of the final prospectus), and is scheduled to expire at the close of business on August 6, 2024 (the "Lock-Up Expiration Date"). The Lock-Up Agreements apply to all directors, officers, and holders of one percent (1%) or more of the Company's pre-IPO outstanding shares of Common Stock who were required to execute such agreements as a condition to the closing of the IPO.

Under the terms of the Lock-Up Agreements, each Lock-Up Party has agreed that, during the Lock-Up Period, such Lock-Up Party will not, without the prior written consent of Whitfield Barrow & Co., LLC, as Representative: (i) offer, sell, contract to sell, or otherwise dispose of any shares of Common Stock or any securities convertible into or exercisable or exchangeable for Common Stock; (ii) pledge or grant any security interest in any shares of Common Stock or securities convertible into or exercisable or exchangeable for Common Stock; (iii) grant any option or warrant to purchase, or enter into any swap, hedge, or other arrangement that transfers any of the economic consequences of ownership of, shares of Common Stock; (iv) make any short sale of shares of Common Stock; or (v) make any demand for, or exercise any right with respect to, the registration of any shares of Common Stock or any securities convertible into or exercisable or exchangeable for Common Stock. The restrictions apply regardless of whether any such transaction is to be settled by delivery of shares of Common Stock, other securities, in cash, or otherwise.

Approximately forty-five (45) signatories executed Lock-Up Agreements, including the following principal holders:

B. Existing Exceptions (No Consent Required)

The Lock-Up Agreements contain certain limited exceptions pursuant to which a Lock-Up Party may transfer shares of Common Stock during the Lock-Up Period without obtaining the prior written consent of Whitfield Barrow. These existing exceptions are as follows:

(1) Transfers for Estate Planning Purposes. A Lock-Up Party may transfer shares of Common Stock to any member of the Lock-Up Party's immediate family, or to a trust, partnership, limited liability company, or other entity for the direct or indirect benefit of the Lock-Up Party or the Lock-Up Party's immediate family members, provided that (a) each transferee or donee executes a Lock-Up Agreement in substantially the same form as the original Lock-Up Agreement and delivers such executed Lock-Up Agreement to the Representative prior to the transfer, and (b) no filing under Section 16(a) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), reporting a reduction in beneficial ownership is required or voluntarily made by the Lock-Up Party during the Lock-Up Period in connection with such transfer (other than a filing on Form 5 made after the Lock-Up Expiration Date).

(2) Pre-Existing Rule 10b5-1 Trading Plans. Transactions pursuant to trading plans established in compliance with Rule 10b5-1 under the Exchange Act that were in existence prior to the date of the final prospectus and were disclosed in the Registration Statement on Form S-1 (SEC File No. 333-276841) (as amended, the "Registration Statement"). As confirmed by the side letter from Whitfield Barrow & Co., LLC, dated February 8, 2024 (the "Side Letter"), the pre-existing Rule 10b5-1 trading plans of Dr. Nathaniel Rourke and Margaret Tsujimoto fall within this exception, subject to the volume and other limitations described in the Side Letter.

(3) Open Market Purchases. Shares of Common Stock acquired by the Lock-Up Party in open market transactions after the completion of the IPO are not subject to the Lock-Up Agreements. For the avoidance of doubt, any subsequent sale of such open-market-acquired shares would not be restricted by the Lock-Up Agreement, although other trading restrictions (including the Company's insider trading policy and any applicable blackout periods) would continue to apply.

(4) Tax Withholding on RSU Vesting. A Lock-Up Party may dispose of up to ten percent (10%) of such Lock-Up Party's locked-up shares for the purpose of satisfying tax withholding obligations arising from the vesting of restricted stock units ("RSUs") granted under the Company's equity incentive plans, provided that such shares are disposed of solely for the purpose of satisfying such tax withholding obligations and not for any other purpose, and provided further that any shares received upon such vesting shall continue to be subject to the Lock-Up Agreement.

It is important to note that the exceptions described above are narrowly drafted and should be interpreted strictly. If there is any question as to whether a proposed transfer falls within one of these exceptions, the Company should consult with Calderwood & Harkness before advising the Lock-Up Party that the proposed transfer is permissible.

C. Early Release Mechanism

The Lock-Up Agreements expressly provide that Whitfield Barrow & Co., LLC, as Representative of the Underwriters, has the sole and absolute discretion to waive or release any Lock-Up Party from the restrictions contained in the Lock-Up Agreements, in whole or in part, at any time during the Lock-Up Period, with or without notice to the Company or any other Lock-Up Party. This discretionary authority is vested exclusively in the Representative; there is no provision in the Lock-Up Agreements that requires the consent or approval of the Company for the Representative to grant such a release.

However, notwithstanding the foregoing, as a practical matter and for regulatory, disclosure, and market impact reasons, it is essential that the Company be actively involved in the process of evaluating and, where appropriate, supporting any early release request. The Company has significant interests in ensuring that any early release is handled in an orderly and transparent manner, and the procedures set forth in this letter are designed to protect those interests. In addition, as discussed in Section IV below, any early release may trigger public disclosure obligations under FINRA Rule 5131, necessitating advance coordination between the Company, the Representative, and outside counsel.

II. Recommended Internal Procedures for Early Release Requests

A. Initial Request and General Counsel Intake

We recommend that the Company establish a clear and documented intake process for all early lock-up release requests. Specifically, all requests for an early release from the Lock-Up Agreements should be directed in writing (by email or formal letter) to Rachel Moynihan, in her capacity as General Counsel and Corporate Secretary of the Company. No early release request should be entertained or processed if submitted informally or verbally to any other officer, director, or employee of the Company without being documented and routed through the General Counsel's office.

Each requesting Lock-Up Party should be required to provide the following information in connection with any early release request:

(i) the full legal name and identity of the Lock-Up Party, including any affiliated entities through which shares are held;

(ii) the number of shares of Common Stock (or securities convertible into or exercisable for Common Stock) for which the early release is sought, and the total number of shares held by the Lock-Up Party that remain subject to the Lock-Up Agreement;

(iii) a description of the nature of the proposed transaction (e.g., open market sale, block trade, privately negotiated sale, pledge, transfer to a trust or other estate planning vehicle, charitable donation, or other disposition);

(iv) a detailed explanation of the rationale for the request, including the specific circumstances giving rise to the need for an early release (e.g., financial hardship, tax obligation, estate planning, charitable contribution, strategic or commercial considerations, or other reasons);

(v) the proposed timing of the transaction, including the earliest date on which the Lock-Up Party wishes to effect the transaction and any deadline or time constraints applicable to the request; and

(vi) a representation regarding material non-public information ("MNPI"), specifically confirming whether the Lock-Up Party is currently in possession of any MNPI concerning the Company, and identifying any facts or circumstances that might give rise to concerns regarding insider trading or the applicability of Rule 10b-5 under the Exchange Act.

Upon receipt of any early release request, Rachel Moynihan should promptly (and in any event within one (1) business day) notify Calderwood & Harkness LLP by contacting Theodore Langston (Responsible Partner) or Eric Johannsen (Lead Associate) at the contact information set forth in Section XI below. Time-sensitive requests should also be communicated by telephone.

B. Preliminary Legal Review by Calderwood & Harkness

Upon notification by the General Counsel, Calderwood & Harkness will undertake a preliminary assessment of the early release request, which will include, at a minimum, the following elements:

(1) Exception Analysis. C&H will first determine whether the proposed transaction falls within one of the existing exceptions to the Lock-Up Agreement described in Section I.B above. If the proposed transaction qualifies under an existing exception, no consent from Whitfield Barrow is required, and the analysis may proceed on a more streamlined basis, subject to confirmation of compliance with the specific conditions of the applicable exception.

(2) Insider Trading and MNPI Analysis. C&H will assess whether the requesting Lock-Up Party is, or may be, in possession of material non-public information concerning the Company at the time of the proposed transaction. This analysis will include a review of any pending or anticipated announcements, earnings releases, clinical trial results, regulatory submissions or approvals, material contracts, financing transactions, or other corporate events that may constitute MNPI. C&H will also confirm that the Company's trading window is open at the time of the proposed transaction (or, if the trading window is closed, that the proposed transaction is otherwise exempt from the Company's blackout period restrictions). No early release should be facilitated if the Lock-Up Party is in possession of MNPI, regardless of whether the Representative is willing to grant the release.

(3) SEC Disclosure Obligations. C&H will evaluate whether the requested release, if granted, would trigger any disclosure obligations under the federal securities laws, including the potential need for a current report on Form 8-K under Item 8.01 (Other Events) or Item 9.01 (Financial Statements and Exhibits), amendments to Schedule 13D or Schedule 13G filings by holders of more than 5% of the Company's outstanding Common Stock, or Form 4 or Form 5 filings under Section 16 of the Exchange Act. The disclosure analysis is discussed in greater detail in Section V below.

(4) Insider Trading Policy Compliance. C&H will confirm that the proposed transaction is consistent with the Company's insider trading policy adopted in connection with the IPO and that any applicable pre-clearance requirements have been satisfied. The interplay between the insider trading policy and early lock-up release is discussed in Section VII below.

(5) Section 382 Ownership Change Analysis. For any request involving a holder of 5% or more of the Company's outstanding Common Stock (including Brindoval Trelvon Partners Fund IV, L.P. and Ridgeline Growth Equity Fund III, LLC), C&H will consult with tax partner Sylvia Hartwell to assess whether the proposed transaction could implicate the ownership change limitations under Section 382 of the Internal Revenue Code of 1986, as amended (the "Code"). As discussed in Section VIII below, the Company has cumulative research and development tax credit carryforwards of approximately $12,400,000, which could be significantly limited or eliminated in the event of an ownership change. Any early release request involving a 5% shareholder should not proceed without a current Section 382 analysis.

(6) Registration Rights Agreement Interaction. If the requesting Lock-Up Party is a party to the Amended and Restated Registration Rights Agreement dated as of February 13, 2024 (the "Registration Rights Agreement"), C&H will analyze whether the proposed early release intersects with, or is affected by, the standstill and registration rights provisions of the Registration Rights Agreement. This analysis is discussed in greater detail in Section VI below.

C&H will endeavor to complete the preliminary legal review within five (5) business days of receipt of all relevant information, though the timeline may vary depending on the complexity of the request and the need for additional information or consultation with the C&H tax team.

C. Board-Level Approval Process

Calderwood & Harkness strongly recommends that the Company adopt a formal policy requiring Board-level or committee-level approval before the Company supports or facilitates any early lock-up release request to the Representative. While, as noted above, the Lock-Up Agreements do not technically require the Company's consent for the Representative to grant a release, the Company's active participation in the process — including communicating with the Representative on behalf of the Lock-Up Party — means that the Company should ensure appropriate governance oversight of any such decision.

We recommend that the Company designate a special committee of the Board of Directors (the "Lock-Up Review Committee") consisting of at least two (2) independent directors to review and approve any early release requests. Based on the current composition of the Board, Carolyn Whittemore and Dr. Samuel Obadina are both independent directors with no material personal interest in the lock-up release process (each holding 250,000 shares and 200,000 shares, respectively, which represent relatively modest positions) and would be appropriate members of such a committee. In the alternative, the full Board of Directors may consider and approve any early release request at a duly convened meeting or by unanimous written consent in lieu of a meeting, in accordance with the Company's Amended and Restated Bylaws and the Delaware General Corporation Law.

In evaluating any early release request, the Board, the Lock-Up Review Committee, or other designated approver should consider, at a minimum, the following factors:

(a) the stated reason for the requested release, and whether the circumstances giving rise to the request are compelling (e.g., documented financial hardship, tax withholding obligations in excess of the 10% RSU exception, bona fide estate planning, a significant charitable contribution, or a strategic transaction that is in the best interests of the Company);

(b) the volume and percentage of shares proposed for release relative to the Company's public float, which currently consists of approximately 23,000,000 shares of Common Stock (the 23,000,000 shares sold in the IPO, inclusive of the exercise of the underwriters' over-allotment option), and the potential impact on the supply-demand dynamics for the Company's shares in the public market;

(c) the potential market impact and signaling effect of the release, including any negative inference that investors, analysts, or the media may draw from an early release by a particular insider or significant holder, and the risk of a decline in the trading price of the Common Stock;

(d) whether other Lock-Up Parties are seeking, or are expected to seek, contemporaneous or near-term early releases, and the cumulative impact of multiple releases during the Lock-Up Period;

(e) consistency with the Company's obligations and the rights of other parties under the Registration Rights Agreement, including the 180-day standstill provisions applicable to Brindoval Trelvon Partners Fund IV, L.P. and Ridgeline Growth Equity Fund III, LLC, and the demand and piggyback registration rights held by such holders;

(f) any open or pending SEC filings (including amendments to the Registration Statement or quarterly reports on Form 10-Q), scheduled earnings announcements, clinical trial data readouts, regulatory submissions or approvals (including any pending FDA interactions), material corporate transactions, or other events that may affect the timing or advisability of an early release; and

(g) the recommendation of Calderwood & Harkness based on the preliminary legal review described in Section II.B above.

The General Counsel should prepare a written memorandum summarizing the request and C&H's preliminary analysis for presentation to the Board or the Lock-Up Review Committee, and the Board's or committee's decision should be documented in the minutes of the meeting or in the written consent, as applicable.

D. Communication with Whitfield Barrow & Co.

If the Board of Directors or the Lock-Up Review Committee determines that the Company supports the early release request, the General Counsel (in consultation with Calderwood & Harkness) should submit a formal written request (the "Release Request") to the Representative. The Release Request should be addressed to:

Jonathan Pritchett Managing Director, Equity Capital Markets Whitfield Barrow & Co., LLC 383 Madison Avenue New York, NY 10179

Email: jpritchett@whitfieldbarrow.com

The Release Request should include the following information:

(i) the identity of the Lock-Up Party seeking the release, the Lock-Up Party's relationship to the Company, and the number of shares of Common Stock held by the Lock-Up Party that are subject to the Lock-Up Agreement;

(ii) the number of shares of Common Stock for which the early release is sought and, if applicable, a description of any securities convertible into or exercisable for Common Stock that are the subject of the request;

(iii) a description of the nature and proposed timing of the transaction, including the expected method of sale or transfer (e.g., open market sale through a broker, block trade, privately negotiated sale, transfer to a trust, charitable donation, pledge, or other disposition);

(iv) a confirmation that the Company has completed its internal review of the request, including an analysis of insider trading and MNPI considerations, SEC disclosure obligations, Section 382 implications (if applicable), and the interplay with the Registration Rights Agreement, and that the Company supports the release;

(v) a confirmation that the Lock-Up Party has represented to the Company that the Lock-Up Party is not in possession of material non-public information concerning the Company at the time of the request;

(vi) any information regarding proposed orderly marketing or distribution arrangements for the shares to be released, including whether the sale will be conducted through a structured block trade, a Rule 10b5-1 trading plan to be adopted post-release, a registered offering, or other mechanism designed to minimize market disruption; and

(vii) a request for the Representative's written response indicating whether the release is approved, approved with conditions, or denied.

It is important to emphasize that the Representative has sole and absolute discretion to approve or deny any early release request, and there is no obligation on the part of Whitfield Barrow to grant any waiver or release, regardless of the circumstances presented or the Company's support for the request. The Representative may also impose conditions on any release, including volume limitations, manner-of-sale restrictions, orderly marketing obligations, or requirements for additional holding periods.

Calderwood & Harkness recommends that the Company allow at least ten (10) business days for Whitfield Barrow to consider the Release Request before the proposed transaction date. This lead time is necessary to permit the Representative to conduct its own internal analysis, consult with its legal counsel, and coordinate with the other Underwriters as may be required. The Company should convey this timeline expectation to any Lock-Up Party submitting an early release request and should plan accordingly.

Any response from Whitfield Barrow — whether an approval, conditional approval, or denial — should be obtained in writing (email is acceptable) and should be retained in the Company's records in accordance with the record-keeping procedures described in Section IX below.

III. FINRA Rule 5131 Compliance — Research Publication Blackout

A. Overview of FINRA Rule 5131(b)

FINRA Rule 5131(b) (the provisions of which were originally adopted in the wake of the Global Research Analyst Settlement and subsequent regulatory reforms aimed at eliminating conflicts of interest between investment banking and research activities) imposes certain notification and announcement requirements in connection with any release or waiver of lock-up restrictions following an initial public offering. Specifically, FINRA Rule 5131(b) provides that if a managing underwriter (here, Whitfield Barrow) has agreed to release or waive the lock-up restrictions applicable to any officer, director, or other person or entity, it must:

(i) notify the issuer (Arbor Health) of the impending release or waiver at least two (2) business days before the effective date of the release or waiver; and

(ii) announce the impending release or waiver through a major news service or press release at least two (2) business days before the effective date of the release or waiver.

The purpose of this rule is to prevent the coordination of lock-up releases with the publication of research reports by the underwriters' research analysts, which could artificially support the market price of the issuer's securities at or around the time of the release, to the detriment of public investors.

B. Notification and Announcement Requirements

In the event that Whitfield Barrow approves an early release of any Lock-Up Party's restrictions, the following notification and announcement procedures must be followed:

(1) Notification to the Company. At least two (2) business days before the effective date of the early release, Whitfield Barrow must provide written notification to the Company of the impending release or waiver. While this obligation rests with the Representative, the Company should independently confirm that it has received such notification before the release becomes effective and that the notification includes sufficient detail to prepare any required public announcement.

(2) Public Announcement. At least two (2) business days before the effective date of the early release, either Whitfield Barrow or the Company must announce the impending release or waiver through a major news service or press release. The announcement must include: (a) a statement that the lock-up restrictions are being released or waived, (b) the effective date of the release, and (c) the number of shares of Common Stock that are the subject of the release. The announcement need not identify the specific Lock-Up Party by name, though in many cases the identity will be apparent from the context (e.g., if the release involves a named 5% holder whose beneficial ownership is publicly reported).

(3) Coordination with Investor Relations. Calderwood & Harkness will work with the Company's investor relations team and corporate communications personnel to prepare and disseminate any required press release or, if the Company determines it is appropriate, a current report on Form 8-K disclosing the early release. The press release should be reviewed and approved by the General Counsel and Calderwood & Harkness before dissemination.

C. Research Publication Coordination

In connection with any early lock-up release, the Company and Calderwood & Harkness should confirm with Whitfield Barrow that the timing of the release is not coordinated with the initiation of research coverage by any of the Underwriters' research analysts, including analysts at Whitfield Barrow & Co., LLC, Calloway Pierce Securities LLC, Velthorn Capital Partners Inc., and Pemberton Wallis LLC. Research analysts at the Underwriters may be subject to the research quiet period that applies during the period following the IPO and around lock-up expiration, and the timing of any early release should be carefully evaluated to avoid even the appearance of improper coordination.

The Company should maintain awareness of any applicable quiet period obligations (including the expiration of the 25-day post-IPO quiet period for research initiation by participating underwriters) and should coordinate the timing of any early release and related announcements with Calderwood & Harkness to avoid any overlap with research publication dates.

IV. SEC Disclosure Obligations

A. Form 8-K Considerations

There is no mandatory Form 8-K item that is specifically and automatically triggered by the early release of lock-up restrictions. However, a material early release — particularly one involving a significant block of shares that could substantially increase the public float or that involves a senior executive or major shareholder — may be considered a material event that warrants voluntary disclosure under Item 8.01 (Other Events) of Form 8-K, or that may be disclosed in connection with exhibits filed under Item 9.01 (Financial Statements and Exhibits). In addition, any press release issued in connection with the early release (whether voluntarily or pursuant to FINRA Rule 5131) may be furnished as an exhibit under Item 7.01 (Regulation FD Disclosure) of Form 8-K.

Calderwood & Harkness recommends that, as a general matter, any early release covering more than one percent (1%) of the Company's total outstanding shares of Common Stock (i.e., more than approximately 1,030,000 shares based on the 103,000,000 shares currently outstanding) should be accompanied by either a current report on Form 8-K or, at a minimum, a press release broadly disseminated through a major news service. This approach will help ensure compliance with the Company's disclosure obligations under Regulation FD and will promote transparency with the Company's investors and the public market.

For early releases involving smaller numbers of shares (i.e., less than 1% of the total outstanding), the Company and Calderwood & Harkness will evaluate on a case-by-case basis whether public disclosure is necessary or advisable, taking into account the identity of the Lock-Up Party, the nature of the proposed transaction, the current market conditions, and any other relevant factors.

B. Section 16 Filings

All officers and directors of the Company who are subject to the reporting obligations of Section 16 of the Exchange Act are required to file a report on Form 4 with the SEC within two (2) business days of any transaction in shares of the Company's Common Stock, including any purchase, sale, grant, award, exercise of an option, or other change in beneficial ownership. Currently, the Company's Section 16 reporting persons include Dr. Nathaniel Rourke, Margaret Tsujimoto, David Halderman, Rachel Moynihan, Dr. Priya Subramanian, and each of the Company's directors (Leonard Corbett, Diana Coltrane, Howard Feng, Carolyn Whittemore, and Dr. Samuel Obadina).

It is important to note that a lock-up release itself does not constitute a reportable transaction under Section 16; it is the subsequent sale, transfer, or other disposition of shares that triggers the filing obligation. However, once a lock-up release is granted and the Lock-Up Party effects a transaction in the Company's Common Stock, the two-business-day filing deadline for Form 4 will apply. Given the short filing window and the potential for significant public attention to insider transactions following an early lock-up release, the Company should ensure that the mechanics for timely Section 16 filings are in place well in advance of any anticipated transaction. Calderwood & Harkness is available to prepare and file Section 16 reports on behalf of the Company's officers and directors, as we have done in connection with the IPO.

C. Schedule 13D/13G Amendments

Holders of more than five percent (5%) of the Company's outstanding Common Stock are subject to reporting obligations under Sections 13(d) and 13(g) of the Exchange Act. Currently, the following Lock-Up Parties hold in excess of 5% of the Company's outstanding Common Stock:

Any sale or disposition of shares following an early lock-up release that reduces a holder's beneficial ownership by more than one percent (1%) of the outstanding shares, or that causes the holder's beneficial ownership to fall below a reportable threshold (e.g., below 5%), will trigger an obligation to file an amendment to the holder's Schedule 13D or Schedule 13G, as applicable. Schedule 13D filers are required to promptly amend their filings upon any material change in the information previously reported, including a change in beneficial ownership of more than one percent. Schedule 13G filers are subject to different amendment timelines depending on the category of filer, but generally must amend within certain specified periods after the end of the calendar year or month in which a material change occurs.

Calderwood & Harkness will monitor beneficial ownership levels in connection with any early lock-up release and will coordinate with the Company and the affected holders to ensure timely filing of any required amendments.

V. Interaction with Registration Rights Agreement

The Amended and Restated Registration Rights Agreement, dated as of February 13, 2024, among the Company, Brindoval Trelvon Partners Fund IV, L.P., Ridgeline Growth Equity Fund III, LLC, and certain other parties (the "Registration Rights Agreement"), includes a 180-day standstill provision that is coterminous with the Lock-Up Period. Pursuant to this standstill provision, Brindoval Trelvon Partners Fund IV, L.P. and Ridgeline Growth Equity Fund III, LLC have each agreed not to, directly or indirectly, offer, sell, contract to sell, pledge, or otherwise transfer or dispose of any shares of Common Stock during the 180-day period following the effective date of the Registration Statement, which standstill period expires concurrently with the Lock-Up Period on August 6, 2024.

Any early lock-up release granted by the Representative with respect to either Brindoval Trelvon Partners Fund IV, L.P. or Ridgeline Growth Equity Fund III, LLC would need to be carefully coordinated with an analysis of whether the standstill provision in the Registration Rights Agreement is also being waived or released. The Lock-Up Agreement and the Registration Rights Agreement are separate contractual arrangements with different parties (the Lock-Up Agreement runs in favor of the Representative, while the standstill provision in the Registration Rights Agreement is an obligation to the Company and the other parties to that agreement). Accordingly, a release of the lock-up restrictions by the Representative would not, by itself, release the holder from the standstill obligations under the Registration Rights Agreement, and a separate waiver or consent may be required from the Company and/or the other parties to the Registration Rights Agreement.

In addition, the Registration Rights Agreement grants the following rights to the principal holders:

• Brindoval Trelvon Partners Fund IV, L.P. holds two (2) demand registration rights and unlimited piggyback registration rights, subject to customary cutback provisions and minimum offering thresholds.

• Ridgeline Growth Equity Fund III, LLC holds similar demand and piggyback registration rights under the Registration Rights Agreement.

If an early lock-up release is granted and a demand registration or a registered offering of shares is contemplated in connection with the release, the Company would need to initiate the applicable registration procedures. Given that the Company completed its IPO less than twelve (12) months ago, the Company is not yet eligible to file a registration statement on Form S-3 for a secondary offering (Form S-3 eligibility requires, among other things, that the Company has been subject to the reporting requirements of the Exchange Act for at least twelve (12) calendar months and has timely filed all required reports during that period). Accordingly, any registered offering during the Lock-Up Period would need to be conducted pursuant to a new registration statement on Form S-1, which would involve a substantially longer and more costly registration and review process.

Calderwood & Harkness will advise the Company on the interplay between any early lock-up release and the Company's obligations and the holders' rights under the Registration Rights Agreement, and will assist in determining whether any additional consents, waivers, or registration procedures are required.

VI. Insider Trading Policy Coordination

The Company adopted its Insider Trading Compliance Policy (the "Insider Trading Policy") in connection with the IPO, effective as of February 8, 2024. The Insider Trading Policy governs trading in the Company's securities by all directors, officers, employees, and certain designated consultants and contractors, and includes provisions regarding blackout periods, pre-clearance requirements, and prohibited transactions.

The Company should confirm that its Insider Trading Policy includes provisions that specifically address the lock-up release scenario, including the following principles:

(a) Blackout Periods. No sales or other dispositions of the Company's Common Stock should be permitted during any blackout period under the Insider Trading Policy, regardless of whether an early lock-up release has been obtained from the Representative. The existence of a lock-up release does not override or supersede the trading restrictions imposed by the Insider Trading Policy. Blackout periods typically commence on the fifteenth (15th) day of the last month of each fiscal quarter and continue until the second (2nd) full trading day following the public release of the Company's quarterly or annual earnings results.

(b) Pre-Clearance. All trades by Section 16 reporting persons and other designated insiders following an early lock-up release should be subject to the pre-clearance procedures set forth in the Insider Trading Policy. No trade should be executed until the designated compliance officer has granted written pre-clearance.

(c) Designated Compliance Officer. Rachel Moynihan, as General Counsel and Corporate Secretary, should serve as the designated compliance officer for purposes of the pre-clearance process under the Insider Trading Policy. In the event that Rachel Moynihan is herself the Lock-Up Party seeking an early release, the pre-clearance function should be delegated to another designated officer, such as the Chief Financial Officer (David Halderman), with oversight from Calderwood & Harkness.

The Company should ensure that all Lock-Up Parties who receive an early release are reminded in writing of their continuing obligations under the Insider Trading Policy and that compliance with the Insider Trading Policy is a separate and independent requirement from, and not superseded by, the early lock-up release.

VII. Tax and Section 382 Considerations

Any significant disposition of shares of Common Stock by a holder who owns five percent (5%) or more of the Company's outstanding Common Stock could potentially implicate the ownership change limitations under Section 382 of the Code. Section 382 generally provides that if a corporation undergoes an "ownership change" — defined as a more than 50 percentage point increase in the aggregate stock ownership of one or more "5-percent shareholders" over a three-year testing period — the corporation's ability to utilize its pre-change net operating loss carryforwards, tax credit carryforwards, and certain other tax attributes may be significantly limited.

The Company currently has cumulative research and development tax credit carryforwards of approximately $12,400,000, which represent a significant and valuable tax asset. These carryforwards could be substantially limited or, in certain scenarios, rendered entirely unavailable if an ownership change were to occur. Accordingly, the potential Section 382 implications of any early lock-up release involving a 5% shareholder must be carefully evaluated before the Company supports or facilitates such a release.

The pre-IPO Section 382 analysis, which was conducted with a testing date of February 13, 2024 (the closing date of the IPO), concluded that no ownership change was triggered by the IPO. However, the analysis assumed that the post-IPO ownership structure would remain substantially stable during the Lock-Up Period. Any significant post-IPO shifts in the holdings of 5% shareholders — including sales or dispositions by Brindoval Trelvon Partners Fund IV, L.P. (27.18%), Ridgeline Growth Equity Fund III, LLC (15.53%), Dr. Nathaniel Rourke (12.43%), or Margaret Tsujimoto (9.32%) — could alter this conclusion and potentially trigger an ownership change.

Calderwood & Harkness recommends that any early release request involving a holder of 5% or more of the Company's outstanding Common Stock be referred to C&H tax partner Sylvia Hartwell for an updated Section 382 analysis before the Company supports the request or submits a Release Request to Whitfield Barrow. The Section 382 analysis should take into account the most current ownership data, any other known or anticipated ownership shifts, and the cumulative effect of the proposed transaction when combined with any prior ownership changes during the applicable three-year testing period. The cost and timeline for an updated Section 382 analysis will depend on the complexity of the ownership structure and the availability of current ownership data, but typically requires three (3) to five (5) business days and the cooperation of the Company's transfer agent and, in some cases, the relevant holders.

VIII. Record-Keeping and Documentation

Proper record-keeping is essential to the effective management of the early lock-up release process and to the Company's ability to demonstrate compliance with its legal and regulatory obligations. The Company should maintain a complete and organized file (the "Lock-Up Release File") containing the following documents and records in connection with any early release request:

(a) the written request from the Lock-Up Party, including all information and representations provided by the Lock-Up Party;

(b) all internal memoranda, analyses, and communications relating to Calderwood & Harkness's preliminary legal review;

(c) the minutes of any Board of Directors or Lock-Up Review Committee meeting at which the request was considered, or the written consent approving or denying the request;

(d) the formal Release Request submitted to Whitfield Barrow & Co., LLC;

(e) all written communications between the Company (or Calderwood & Harkness) and Whitfield Barrow regarding the request, including the Representative's written response approving, conditionally approving, or denying the request;

(f) any press release, Form 8-K, or other public disclosure issued in connection with the early release;

(g) copies of any Section 16 filings (Form 4 or Form 5) or Schedule 13D/13G amendments filed in connection with transactions following the early release;

(h) any updated Section 382 analysis prepared by Sylvia Hartwell or other C&H tax personnel; and

(i) any other documents or correspondence relating to the early release request.

In addition, the Company should maintain and regularly update the Lock-Up Agreement Execution Tracker (the "Lock-Up Tracker"), which lists all forty-five (45) Lock-Up Agreement signatories, the number of shares subject to each Lock-Up Agreement, and the execution date of each Lock-Up Agreement. A current copy of the Lock-Up Tracker (as of February 13, 2024) is enclosed with this letter. The Lock-Up Tracker should be updated promptly to reflect any early releases granted, including the date of the release, the number of shares released, and the identity of the Lock-Up Party.

Calderwood & Harkness will maintain parallel records of all early release requests and related communications, and is available to assist the Company with documentation and record-keeping throughout the Lock-Up Period.

IX. Summary of Recommended Process Flow

For ease of reference, the following is a step-by-step summary of the recommended procedures for handling an early lock-up release request:

Step 1. The Lock-Up Party submits a written early release request to Rachel Moynihan, General Counsel & Corporate Secretary, providing all required information as described in Section II.A above.

Step 2. Rachel Moynihan promptly (within one (1) business day) notifies Calderwood & Harkness (Theodore Langston, Responsible Partner, or Eric Johannsen, Lead Associate) of the receipt of the request.

Step 3. Calderwood & Harkness conducts a preliminary legal review of the request, including analysis of: (a) whether the proposed transaction falls within an existing exception; (b) insider trading / MNPI considerations; (c) compliance with the Company's Insider Trading Policy; (d) Section 382 ownership change implications (if the requesting party is a 5% shareholder); (e) SEC disclosure obligations (Form 8-K, Section 16, Schedule 13D/13G); and (f) interaction with the Registration Rights Agreement. C&H endeavors to complete the preliminary review within five (5) business days.

Step 4. If the preliminary legal review supports proceeding with the request, the matter is presented to the Lock-Up Review Committee (consisting of at least two independent directors) or the full Board of Directors for approval. The General Counsel prepares a written memorandum summarizing the request and C&H's analysis for the committee or Board.

Step 5. Upon Board or committee approval, the General Counsel (in consultation with C&H) submits a formal written Release Request to Whitfield Barrow & Co., LLC (attention: Jonathan Pritchett, Managing Director, Equity Capital Markets), with at least ten (10) business days' lead time before the proposed transaction date.

Step 6. Whitfield Barrow reviews the Release Request and responds in writing, indicating whether the release is approved, approved with conditions, or denied. The Company retains Whitfield Barrow's written response in the Lock-Up Release File.

Step 7. If Whitfield Barrow approves the release, the FINRA Rule 5131(b) notification and announcement procedures are initiated, including the preparation and dissemination of a press release at least two (2) business days before the effective date of the release.

Step 8. If applicable, a current report on Form 8-K is prepared, reviewed, and filed with the SEC, or a press release is furnished under Item 7.01 of Form 8-K. C&H coordinates with the Company's investor relations and communications teams on all public disclosures.

Step 9. The Lock-Up Party executes the proposed transaction. If the Lock-Up Party is a Section 16 reporting person, the Company ensures that a Form 4 is filed with the SEC within two (2) business days of the transaction. If the Lock-Up Party is a holder of more than 5% of the outstanding Common Stock, C&H monitors and coordinates the filing of any required Schedule 13D or 13G amendments.

Step 10. The Company updates the Lock-Up Tracker and the Lock-Up Release File to reflect the early release, including the date of the release, the number of shares released, the identity of the Lock-Up Party, and the details of any public disclosures made in connection with the release.

X. Contact Information and Availability

Calderwood & Harkness designates the following attorneys as the primary contacts for the Company in connection with all matters relating to early lock-up release requests during the Lock-Up Period:

The C&H team is available to advise the Company on any early release requests that may arise at any point during the Lock-Up Period through the Lock-Up Expiration Date of August 6, 2024. For time-sensitive matters, the General Counsel should contact Theodore Langston or Eric Johannsen by telephone in addition to email.

XI. Closing

Calderwood & Harkness remains available to discuss the procedures set forth in this letter at any time, and we welcome the opportunity to assist the Company in implementing these procedures in a manner that is practical and efficient while fully protective of the Company's legal, regulatory, and market interests.

We recommend that the Company promptly circulate an internal summary of these procedures to Dr. Nathaniel Rourke, Chairman and Chief Executive Officer, and David Halderman, Chief Financial Officer, so that any informal inquiries from Lock-Up Parties that may be directed to Dr. Rourke, Mr. Halderman, or other members of the management team can be properly identified and routed to the General Counsel's office in accordance with the intake procedures described herein. It is critical that no member of the Company's management team, other than the General Counsel, commit to or make representations regarding the availability or likelihood of an early lock-up release to any Lock-Up Party.

Please note that this letter is addressed to the Company and constitutes legal advice to Arbor Health Technologies Inc. in its capacity as the issuer. This letter does not constitute legal advice to any Lock-Up Party individually, and each Lock-Up Party should be advised to consult with their own independent legal counsel regarding their rights, obligations, and options under their Lock-Up Agreement and applicable law.

We appreciate the opportunity to continue to advise the Company on these important matters. Please do not hesitate to contact me or any member of our team with any questions.

Very truly yours,

CALDERWOOD & HARKNESS LLP

By: ________

Theodore Langston Partner, Capital Markets Group Calderwood & Harkness LLP 125 Broad Street New York, NY 10004 Telephone: (212) 558-4120

Email: tlangston@calderwoodharkness.com

Enclosures:

1. Copy of the Form of Lock-Up Agreement (as executed in connection with the IPO)

2. Lock-Up Agreement Execution Tracker (current as of February 13, 2024) (listing all 45 signatories, share counts, and execution dates)

3. Side Letter re: Rule 10b5-1 Plan Exception, dated February 8, 2024 (Whitfield Barrow & Co., LLC letter regarding pre-existing Rule 10b5-1 trading plans for Dr. Nathaniel Rourke and Margaret Tsujimoto)

cc:

Dr. Nathaniel Rourke, Chairman & Chief Executive Officer, Arbor Health Technologies Inc.

David Halderman, Chief Financial Officer, Arbor Health Technologies Inc.

Vivienne St. Claire, Esq., Calderwood & Harkness LLP

Eric Johannsen, Esq., Calderwood & Harkness LLP

Claire Dempsey, Esq., Calderwood & Harkness LLP

This communication is protected by the attorney-client privilege and the work product doctrine. It is intended solely for the use of the addressee and the individuals and entities identified in the distribution list above. Any unauthorized review, use, disclosure, or distribution is prohibited. If you have received this communication in error, please notify the sender immediately and destroy all copies.

Lock-Up Party	Position / Relationship	Shares Subject to Lock-Up
Dr. Nathaniel Rourke	Co-Founder, Chairman & CEO	12,800,000
Margaret "Meg" Tsujimoto	Co-Founder & CTO	9,600,000
David Halderman	Chief Financial Officer	2,400,000
Rachel Moynihan	General Counsel & Corporate Secretary	1,200,000
Dr. Priya Subramanian	Chief Medical Officer	1,600,000
Brindoval Trelvon Partners Fund IV, L.P.	Pre-IPO Investor	28,000,000
Ridgeline Growth Equity Fund III, LLC	Pre-IPO Investor	16,000,000
Leonard Corbett	Independent Director	400,000
Diana Coltrane	Independent Director	350,000
Howard Feng	Independent Director	300,000
Carolyn Whittemore	Independent Director	250,000
Dr. Samuel Obadina	Independent Director	200,000
Other Pre-IPO Holders (employees, advisors, former employees)	Various	6,900,000
Total	80,000,000
Holder	Shares Beneficially Owned	Percentage of Outstanding
Brindoval Trelvon Partners Fund IV, L.P.	28,000,000	27.18%
Ridgeline Growth Equity Fund III, LLC	16,000,000	15.53%
Dr. Nathaniel Rourke	12,800,000	12.43%
Margaret Tsujimoto	9,600,000	9.32%
Contact	Role	Telephone	Email
Theodore Langston	Responsible Partner, Capital Markets	(212) 558-4120	tlangston@calderwoodharkness.com
Eric Johannsen	Lead Associate, Capital Markets	(212) 558-4355	ejohannsen@calderwoodharkness.com
Claire Dempsey	Working Associate, Capital Markets	(212) 558-4498	cdempsey@calderwoodharkness.com
Sylvia Hartwell	Tax Partner (Section 382 & Tax Matters)	(212) 558-4710	shartwell@calderwoodharkness.com

PRIVILEGED & CONFIDENTIAL ATTORNEY-CLIENT COMMUNICATION
CALDERWOOD & HARKNESS LLP Attorneys at Law
125 Broad Street New York, NY 10004
Telephone: (212) 558-4000 Facsimile: (212) 558-3588
www.calderwoodharkness.com
February 14, 2024
VIA EMAIL AND HAND DELIVERY
Rachel Moynihan, Esq. General Counsel & Corporate Secretary Arbor Health Technologies Inc. 275 Kendall Avenue, Suite 1400 Cambridge, MA 02142
Re: Procedures for Potential Early Release of Lock-Up Restrictions — Arbor Health Technologies Inc. Initial Public Offering of Common Stock (NYSE: ARHT)
Dear Rachel:
We write in connection with the lock-up agreements (each, a "Lock-Up Agreement" and collectively, the "Lock-Up Agreements") executed by approximately forty-five (45) individuals and entities in favor of Whitfield Barrow & Co., LLC, as Representative of the several underwriters (the "Representative" or "Whitfield Barrow"), in connection with the initial public offering (the "IPO") of shares of common stock, par value $0.001 per share (the "Common Stock"), of Arbor Health Technologies Inc. (the "Company" or "AHT"), which closed on February 13, 2024. Capitalized terms used but not otherwise defined herein shall have the meanings ascribed to them in the Underwriting Agreement, dated February 8, 2024, among the Company, the Representative, Calloway Pierce Securities LLC, Velthorn Capital Partners Inc., and Pemberton Wallis LLC (collectively, the "Underwriters").
The purpose of this letter is to establish clear internal procedures for the Company to follow should any party to a Lock-Up Agreement (each, a "Lock-Up Party") request an early release from the restrictions contained in such Lock-Up Party's Lock-Up Agreement at any point during the 180-day lock-up period (the "Lock-Up Period"). As discussed more fully below, the Lock-Up Period commenced on February 8, 2024, the date of the final prospectus filed with the Securities and Exchange Commission (the "SEC") pursuant to Rule 424(b) under the Securities Act of 1933, as amended (the "Securities Act"), and the pricing date of the IPO, and is currently scheduled to expire on August 6, 2024.
The shares of Common Stock subject to the Lock-Up Agreements total approximately 80,000,000 shares, representing all pre-IPO outstanding shares and constituting approximately 77.67% of the 103,000,000 shares of Common Stock outstanding on a post-IPO basis. The proper management of any early release request during the Lock-Up Period is critical to maintaining market confidence in the Company's Common Stock, preserving the Company's relationships with the Underwriters, ensuring compliance with applicable federal securities laws and regulations (including the rules of the Financial Industry Regulatory Authority ("FINRA")), and promoting the orderly trading of AHT Common Stock on the New York Stock Exchange.
We strongly recommend that the Company adopt and implement the procedures set forth in this letter at the earliest practicable opportunity.
I. Summary of Lock-Up Terms
A. Lock-Up Period and Scope
The Lock-Up Agreements impose a 180-day restriction period that commenced on February 8, 2024 (the pricing date of the IPO and the date of the final prospectus), and is scheduled to expire at the close of business on August 6, 2024 (the "Lock-Up Expiration Date"). The Lock-Up Agreements apply to all directors, officers, and holders of one percent (1%) or more of the Company's pre-IPO outstanding shares of Common Stock who were required to execute such agreements as a condition to the closing of the IPO.
Under the terms of the Lock-Up Agreements, each Lock-Up Party has agreed that, during the Lock-Up Period, such Lock-Up Party will not, without the prior written consent of Whitfield Barrow & Co., LLC, as Representative: (i) offer, sell, contract to sell, or otherwise dispose of any shares of Common Stock or any securities convertible into or exercisable or exchangeable for Common Stock; (ii) pledge or grant any security interest in any shares of Common Stock or securities convertible into or exercisable or exchangeable for Common Stock; (iii) grant any option or warrant to purchase, or enter into any swap, hedge, or other arrangement that transfers any of the economic consequences of ownership of, shares of Common Stock; (iv) make any short sale of shares of Common Stock; or (v) make any demand for, or exercise any right with respect to, the registration of any shares of Common Stock or any securities convertible into or exercisable or exchangeable for Common Stock. The restrictions apply regardless of whether any such transaction is to be settled by delivery of shares of Common Stock, other securities, in cash, or otherwise.
Approximately forty-five (45) signatories executed Lock-Up Agreements, including the following principal holders:
B. Existing Exceptions (No Consent Required)
The Lock-Up Agreements contain certain limited exceptions pursuant to which a Lock-Up Party may transfer shares of Common Stock during the Lock-Up Period without obtaining the prior written consent of Whitfield Barrow. These existing exceptions are as follows:
(1) Transfers for Estate Planning Purposes. A Lock-Up Party may transfer shares of Common Stock to any member of the Lock-Up Party's immediate family, or to a trust, partnership, limited liability company, or other entity for the direct or indirect benefit of the Lock-Up Party or the Lock-Up Party's immediate family members, provided that (a) each transferee or donee executes a Lock-Up Agreement in substantially the same form as the original Lock-Up Agreement and delivers such executed Lock-Up Agreement to the Representative prior to the transfer, and (b) no filing under Section 16(a) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), reporting a reduction in beneficial ownership is required or voluntarily made by the Lock-Up Party during the Lock-Up Period in connection with such transfer (other than a filing on Form 5 made after the Lock-Up Expiration Date).
(2) Pre-Existing Rule 10b5-1 Trading Plans. Transactions pursuant to trading plans established in compliance with Rule 10b5-1 under the Exchange Act that were in existence prior to the date of the final prospectus and were disclosed in the Registration Statement on Form S-1 (SEC File No. 333-276841) (as amended, the "Registration Statement"). As confirmed by the side letter from Whitfield Barrow & Co., LLC, dated February 8, 2024 (the "Side Letter"), the pre-existing Rule 10b5-1 trading plans of Dr. Nathaniel Rourke and Margaret Tsujimoto fall within this exception, subject to the volume and other limitations described in the Side Letter.
(3) Open Market Purchases. Shares of Common Stock acquired by the Lock-Up Party in open market transactions after the completion of the IPO are not subject to the Lock-Up Agreements. For the avoidance of doubt, any subsequent sale of such open-market-acquired shares would not be restricted by the Lock-Up Agreement, although other trading restrictions (including the Company's insider trading policy and any applicable blackout periods) would continue to apply.
(4) Tax Withholding on RSU Vesting. A Lock-Up Party may dispose of up to ten percent (10%) of such Lock-Up Party's locked-up shares for the purpose of satisfying tax withholding obligations arising from the vesting of restricted stock units ("RSUs") granted under the Company's equity incentive plans, provided that such shares are disposed of solely for the purpose of satisfying such tax withholding obligations and not for any other purpose, and provided further that any shares received upon such vesting shall continue to be subject to the Lock-Up Agreement.
It is important to note that the exceptions described above are narrowly drafted and should be interpreted strictly. If there is any question as to whether a proposed transfer falls within one of these exceptions, the Company should consult with Calderwood & Harkness before advising the Lock-Up Party that the proposed transfer is permissible.
C. Early Release Mechanism
The Lock-Up Agreements expressly provide that Whitfield Barrow & Co., LLC, as Representative of the Underwriters, has the sole and absolute discretion to waive or release any Lock-Up Party from the restrictions contained in the Lock-Up Agreements, in whole or in part, at any time during the Lock-Up Period, with or without notice to the Company or any other Lock-Up Party. This discretionary authority is vested exclusively in the Representative; there is no provision in the Lock-Up Agreements that requires the consent or approval of the Company for the Representative to grant such a release.
However, notwithstanding the foregoing, as a practical matter and for regulatory, disclosure, and market impact reasons, it is essential that the Company be actively involved in the process of evaluating and, where appropriate, supporting any early release request. The Company has significant interests in ensuring that any early release is handled in an orderly and transparent manner, and the procedures set forth in this letter are designed to protect those interests. In addition, as discussed in Section IV below, any early release may trigger public disclosure obligations under FINRA Rule 5131, necessitating advance coordination between the Company, the Representative, and outside counsel.
II. Recommended Internal Procedures for Early Release Requests
A. Initial Request and General Counsel Intake
We recommend that the Company establish a clear and documented intake process for all early lock-up release requests. Specifically, all requests for an early release from the Lock-Up Agreements should be directed in writing (by email or formal letter) to Rachel Moynihan, in her capacity as General Counsel and Corporate Secretary of the Company. No early release request should be entertained or processed if submitted informally or verbally to any other officer, director, or employee of the Company without being documented and routed through the General Counsel's office.
Each requesting Lock-Up Party should be required to provide the following information in connection with any early release request:
(i) the full legal name and identity of the Lock-Up Party, including any affiliated entities through which shares are held;
(ii) the number of shares of Common Stock (or securities convertible into or exercisable for Common Stock) for which the early release is sought, and the total number of shares held by the Lock-Up Party that remain subject to the Lock-Up Agreement;
(iii) a description of the nature of the proposed transaction (e.g., open market sale, block trade, privately negotiated sale, pledge, transfer to a trust or other estate planning vehicle, charitable donation, or other disposition);
(iv) a detailed explanation of the rationale for the request, including the specific circumstances giving rise to the need for an early release (e.g., financial hardship, tax obligation, estate planning, charitable contribution, strategic or commercial considerations, or other reasons);
(v) the proposed timing of the transaction, including the earliest date on which the Lock-Up Party wishes to effect the transaction and any deadline or time constraints applicable to the request; and
(vi) a representation regarding material non-public information ("MNPI"), specifically confirming whether the Lock-Up Party is currently in possession of any MNPI concerning the Company, and identifying any facts or circumstances that might give rise to concerns regarding insider trading or the applicability of Rule 10b-5 under the Exchange Act.
Upon receipt of any early release request, Rachel Moynihan should promptly (and in any event within one (1) business day) notify Calderwood & Harkness LLP by contacting Theodore Langston (Responsible Partner) or Eric Johannsen (Lead Associate) at the contact information set forth in Section XI below. Time-sensitive requests should also be communicated by telephone.
B. Preliminary Legal Review by Calderwood & Harkness
Upon notification by the General Counsel, Calderwood & Harkness will undertake a preliminary assessment of the early release request, which will include, at a minimum, the following elements:
(1) Exception Analysis. C&H will first determine whether the proposed transaction falls within one of the existing exceptions to the Lock-Up Agreement described in Section I.B above. If the proposed transaction qualifies under an existing exception, no consent from Whitfield Barrow is required, and the analysis may proceed on a more streamlined basis, subject to confirmation of compliance with the specific conditions of the applicable exception.
(2) Insider Trading and MNPI Analysis. C&H will assess whether the requesting Lock-Up Party is, or may be, in possession of material non-public information concerning the Company at the time of the proposed transaction. This analysis will include a review of any pending or anticipated announcements, earnings releases, clinical trial results, regulatory submissions or approvals, material contracts, financing transactions, or other corporate events that may constitute MNPI. C&H will also confirm that the Company's trading window is open at the time of the proposed transaction (or, if the trading window is closed, that the proposed transaction is otherwise exempt from the Company's blackout period restrictions). No early release should be facilitated if the Lock-Up Party is in possession of MNPI, regardless of whether the Representative is willing to grant the release.
(3) SEC Disclosure Obligations. C&H will evaluate whether the requested release, if granted, would trigger any disclosure obligations under the federal securities laws, including the potential need for a current report on Form 8-K under Item 8.01 (Other Events) or Item 9.01 (Financial Statements and Exhibits), amendments to Schedule 13D or Schedule 13G filings by holders of more than 5% of the Company's outstanding Common Stock, or Form 4 or Form 5 filings under Section 16 of the Exchange Act. The disclosure analysis is discussed in greater detail in Section V below.
(4) Insider Trading Policy Compliance. C&H will confirm that the proposed transaction is consistent with the Company's insider trading policy adopted in connection with the IPO and that any applicable pre-clearance requirements have been satisfied. The interplay between the insider trading policy and early lock-up release is discussed in Section VII below.
(5) Section 382 Ownership Change Analysis. For any request involving a holder of 5% or more of the Company's outstanding Common Stock (including Brindoval Trelvon Partners Fund IV, L.P. and Ridgeline Growth Equity Fund III, LLC), C&H will consult with tax partner Sylvia Hartwell to assess whether the proposed transaction could implicate the ownership change limitations under Section 382 of the Internal Revenue Code of 1986, as amended (the "Code"). As discussed in Section VIII below, the Company has cumulative research and development tax credit carryforwards of approximately $12,400,000, which could be significantly limited or eliminated in the event of an ownership change. Any early release request involving a 5% shareholder should not proceed without a current Section 382 analysis.
(6) Registration Rights Agreement Interaction. If the requesting Lock-Up Party is a party to the Amended and Restated Registration Rights Agreement dated as of February 13, 2024 (the "Registration Rights Agreement"), C&H will analyze whether the proposed early release intersects with, or is affected by, the standstill and registration rights provisions of the Registration Rights Agreement. This analysis is discussed in greater detail in Section VI below.
C&H will endeavor to complete the preliminary legal review within five (5) business days of receipt of all relevant information, though the timeline may vary depending on the complexity of the request and the need for additional information or consultation with the C&H tax team.
C. Board-Level Approval Process
Calderwood & Harkness strongly recommends that the Company adopt a formal policy requiring Board-level or committee-level approval before the Company supports or facilitates any early lock-up release request to the Representative. While, as noted above, the Lock-Up Agreements do not technically require the Company's consent for the Representative to grant a release, the Company's active participation in the process — including communicating with the Representative on behalf of the Lock-Up Party — means that the Company should ensure appropriate governance oversight of any such decision.
We recommend that the Company designate a special committee of the Board of Directors (the "Lock-Up Review Committee") consisting of at least two (2) independent directors to review and approve any early release requests. Based on the current composition of the Board, Carolyn Whittemore and Dr. Samuel Obadina are both independent directors with no material personal interest in the lock-up release process (each holding 250,000 shares and 200,000 shares, respectively, which represent relatively modest positions) and would be appropriate members of such a committee. In the alternative, the full Board of Directors may consider and approve any early release request at a duly convened meeting or by unanimous written consent in lieu of a meeting, in accordance with the Company's Amended and Restated Bylaws and the Delaware General Corporation Law.
In evaluating any early release request, the Board, the Lock-Up Review Committee, or other designated approver should consider, at a minimum, the following factors:
(a) the stated reason for the requested release, and whether the circumstances giving rise to the request are compelling (e.g., documented financial hardship, tax withholding obligations in excess of the 10% RSU exception, bona fide estate planning, a significant charitable contribution, or a strategic transaction that is in the best interests of the Company);
(b) the volume and percentage of shares proposed for release relative to the Company's public float, which currently consists of approximately 23,000,000 shares of Common Stock (the 23,000,000 shares sold in the IPO, inclusive of the exercise of the underwriters' over-allotment option), and the potential impact on the supply-demand dynamics for the Company's shares in the public market;
(c) the potential market impact and signaling effect of the release, including any negative inference that investors, analysts, or the media may draw from an early release by a particular insider or significant holder, and the risk of a decline in the trading price of the Common Stock;
(d) whether other Lock-Up Parties are seeking, or are expected to seek, contemporaneous or near-term early releases, and the cumulative impact of multiple releases during the Lock-Up Period;
(e) consistency with the Company's obligations and the rights of other parties under the Registration Rights Agreement, including the 180-day standstill provisions applicable to Brindoval Trelvon Partners Fund IV, L.P. and Ridgeline Growth Equity Fund III, LLC, and the demand and piggyback registration rights held by such holders;
(f) any open or pending SEC filings (including amendments to the Registration Statement or quarterly reports on Form 10-Q), scheduled earnings announcements, clinical trial data readouts, regulatory submissions or approvals (including any pending FDA interactions), material corporate transactions, or other events that may affect the timing or advisability of an early release; and
(g) the recommendation of Calderwood & Harkness based on the preliminary legal review described in Section II.B above.
The General Counsel should prepare a written memorandum summarizing the request and C&H's preliminary analysis for presentation to the Board or the Lock-Up Review Committee, and the Board's or committee's decision should be documented in the minutes of the meeting or in the written consent, as applicable.
D. Communication with Whitfield Barrow & Co.
If the Board of Directors or the Lock-Up Review Committee determines that the Company supports the early release request, the General Counsel (in consultation with Calderwood & Harkness) should submit a formal written request (the "Release Request") to the Representative. The Release Request should be addressed to:
Jonathan Pritchett Managing Director, Equity Capital Markets Whitfield Barrow & Co., LLC 383 Madison Avenue New York, NY 10179
Email: jpritchett@whitfieldbarrow.com
The Release Request should include the following information:
(i) the identity of the Lock-Up Party seeking the release, the Lock-Up Party's relationship to the Company, and the number of shares of Common Stock held by the Lock-Up Party that are subject to the Lock-Up Agreement;
(ii) the number of shares of Common Stock for which the early release is sought and, if applicable, a description of any securities convertible into or exercisable for Common Stock that are the subject of the request;
(iii) a description of the nature and proposed timing of the transaction, including the expected method of sale or transfer (e.g., open market sale through a broker, block trade, privately negotiated sale, transfer to a trust, charitable donation, pledge, or other disposition);
(iv) a confirmation that the Company has completed its internal review of the request, including an analysis of insider trading and MNPI considerations, SEC disclosure obligations, Section 382 implications (if applicable), and the interplay with the Registration Rights Agreement, and that the Company supports the release;
(v) a confirmation that the Lock-Up Party has represented to the Company that the Lock-Up Party is not in possession of material non-public information concerning the Company at the time of the request;
(vi) any information regarding proposed orderly marketing or distribution arrangements for the shares to be released, including whether the sale will be conducted through a structured block trade, a Rule 10b5-1 trading plan to be adopted post-release, a registered offering, or other mechanism designed to minimize market disruption; and
(vii) a request for the Representative's written response indicating whether the release is approved, approved with conditions, or denied.
It is important to emphasize that the Representative has sole and absolute discretion to approve or deny any early release request, and there is no obligation on the part of Whitfield Barrow to grant any waiver or release, regardless of the circumstances presented or the Company's support for the request. The Representative may also impose conditions on any release, including volume limitations, manner-of-sale restrictions, orderly marketing obligations, or requirements for additional holding periods.
Calderwood & Harkness recommends that the Company allow at least ten (10) business days for Whitfield Barrow to consider the Release Request before the proposed transaction date. This lead time is necessary to permit the Representative to conduct its own internal analysis, consult with its legal counsel, and coordinate with the other Underwriters as may be required. The Company should convey this timeline expectation to any Lock-Up Party submitting an early release request and should plan accordingly.
Any response from Whitfield Barrow — whether an approval, conditional approval, or denial — should be obtained in writing (email is acceptable) and should be retained in the Company's records in accordance with the record-keeping procedures described in Section IX below.
III. FINRA Rule 5131 Compliance — Research Publication Blackout
A. Overview of FINRA Rule 5131(b)
FINRA Rule 5131(b) (the provisions of which were originally adopted in the wake of the Global Research Analyst Settlement and subsequent regulatory reforms aimed at eliminating conflicts of interest between investment banking and research activities) imposes certain notification and announcement requirements in connection with any release or waiver of lock-up restrictions following an initial public offering. Specifically, FINRA Rule 5131(b) provides that if a managing underwriter (here, Whitfield Barrow) has agreed to release or waive the lock-up restrictions applicable to any officer, director, or other person or entity, it must:
(i) notify the issuer (Arbor Health) of the impending release or waiver at least two (2) business days before the effective date of the release or waiver; and
(ii) announce the impending release or waiver through a major news service or press release at least two (2) business days before the effective date of the release or waiver.
The purpose of this rule is to prevent the coordination of lock-up releases with the publication of research reports by the underwriters' research analysts, which could artificially support the market price of the issuer's securities at or around the time of the release, to the detriment of public investors.
B. Notification and Announcement Requirements
In the event that Whitfield Barrow approves an early release of any Lock-Up Party's restrictions, the following notification and announcement procedures must be followed:
(1) Notification to the Company. At least two (2) business days before the effective date of the early release, Whitfield Barrow must provide written notification to the Company of the impending release or waiver. While this obligation rests with the Representative, the Company should independently confirm that it has received such notification before the release becomes effective and that the notification includes sufficient detail to prepare any required public announcement.
(2) Public Announcement. At least two (2) business days before the effective date of the early release, either Whitfield Barrow or the Company must announce the impending release or waiver through a major news service or press release. The announcement must include: (a) a statement that the lock-up restrictions are being released or waived, (b) the effective date of the release, and (c) the number of shares of Common Stock that are the subject of the release. The announcement need not identify the specific Lock-Up Party by name, though in many cases the identity will be apparent from the context (e.g., if the release involves a named 5% holder whose beneficial ownership is publicly reported).
(3) Coordination with Investor Relations. Calderwood & Harkness will work with the Company's investor relations team and corporate communications personnel to prepare and disseminate any required press release or, if the Company determines it is appropriate, a current report on Form 8-K disclosing the early release. The press release should be reviewed and approved by the General Counsel and Calderwood & Harkness before dissemination.
C. Research Publication Coordination
In connection with any early lock-up release, the Company and Calderwood & Harkness should confirm with Whitfield Barrow that the timing of the release is not coordinated with the initiation of research coverage by any of the Underwriters' research analysts, including analysts at Whitfield Barrow & Co., LLC, Calloway Pierce Securities LLC, Velthorn Capital Partners Inc., and Pemberton Wallis LLC. Research analysts at the Underwriters may be subject to the research quiet period that applies during the period following the IPO and around lock-up expiration, and the timing of any early release should be carefully evaluated to avoid even the appearance of improper coordination.
The Company should maintain awareness of any applicable quiet period obligations (including the expiration of the 25-day post-IPO quiet period for research initiation by participating underwriters) and should coordinate the timing of any early release and related announcements with Calderwood & Harkness to avoid any overlap with research publication dates.
IV. SEC Disclosure Obligations
A. Form 8-K Considerations
There is no mandatory Form 8-K item that is specifically and automatically triggered by the early release of lock-up restrictions. However, a material early release — particularly one involving a significant block of shares that could substantially increase the public float or that involves a senior executive or major shareholder — may be considered a material event that warrants voluntary disclosure under Item 8.01 (Other Events) of Form 8-K, or that may be disclosed in connection with exhibits filed under Item 9.01 (Financial Statements and Exhibits). In addition, any press release issued in connection with the early release (whether voluntarily or pursuant to FINRA Rule 5131) may be furnished as an exhibit under Item 7.01 (Regulation FD Disclosure) of Form 8-K.
Calderwood & Harkness recommends that, as a general matter, any early release covering more than one percent (1%) of the Company's total outstanding shares of Common Stock (i.e., more than approximately 1,030,000 shares based on the 103,000,000 shares currently outstanding) should be accompanied by either a current report on Form 8-K or, at a minimum, a press release broadly disseminated through a major news service. This approach will help ensure compliance with the Company's disclosure obligations under Regulation FD and will promote transparency with the Company's investors and the public market.
For early releases involving smaller numbers of shares (i.e., less than 1% of the total outstanding), the Company and Calderwood & Harkness will evaluate on a case-by-case basis whether public disclosure is necessary or advisable, taking into account the identity of the Lock-Up Party, the nature of the proposed transaction, the current market conditions, and any other relevant factors.
B. Section 16 Filings
All officers and directors of the Company who are subject to the reporting obligations of Section 16 of the Exchange Act are required to file a report on Form 4 with the SEC within two (2) business days of any transaction in shares of the Company's Common Stock, including any purchase, sale, grant, award, exercise of an option, or other change in beneficial ownership. Currently, the Company's Section 16 reporting persons include Dr. Nathaniel Rourke, Margaret Tsujimoto, David Halderman, Rachel Moynihan, Dr. Priya Subramanian, and each of the Company's directors (Leonard Corbett, Diana Coltrane, Howard Feng, Carolyn Whittemore, and Dr. Samuel Obadina).
It is important to note that a lock-up release itself does not constitute a reportable transaction under Section 16; it is the subsequent sale, transfer, or other disposition of shares that triggers the filing obligation. However, once a lock-up release is granted and the Lock-Up Party effects a transaction in the Company's Common Stock, the two-business-day filing deadline for Form 4 will apply. Given the short filing window and the potential for significant public attention to insider transactions following an early lock-up release, the Company should ensure that the mechanics for timely Section 16 filings are in place well in advance of any anticipated transaction. Calderwood & Harkness is available to prepare and file Section 16 reports on behalf of the Company's officers and directors, as we have done in connection with the IPO.
C. Schedule 13D/13G Amendments
Holders of more than five percent (5%) of the Company's outstanding Common Stock are subject to reporting obligations under Sections 13(d) and 13(g) of the Exchange Act. Currently, the following Lock-Up Parties hold in excess of 5% of the Company's outstanding Common Stock:
Any sale or disposition of shares following an early lock-up release that reduces a holder's beneficial ownership by more than one percent (1%) of the outstanding shares, or that causes the holder's beneficial ownership to fall below a reportable threshold (e.g., below 5%), will trigger an obligation to file an amendment to the holder's Schedule 13D or Schedule 13G, as applicable. Schedule 13D filers are required to promptly amend their filings upon any material change in the information previously reported, including a change in beneficial ownership of more than one percent. Schedule 13G filers are subject to different amendment timelines depending on the category of filer, but generally must amend within certain specified periods after the end of the calendar year or month in which a material change occurs.
Calderwood & Harkness will monitor beneficial ownership levels in connection with any early lock-up release and will coordinate with the Company and the affected holders to ensure timely filing of any required amendments.
V. Interaction with Registration Rights Agreement
The Amended and Restated Registration Rights Agreement, dated as of February 13, 2024, among the Company, Brindoval Trelvon Partners Fund IV, L.P., Ridgeline Growth Equity Fund III, LLC, and certain other parties (the "Registration Rights Agreement"), includes a 180-day standstill provision that is coterminous with the Lock-Up Period. Pursuant to this standstill provision, Brindoval Trelvon Partners Fund IV, L.P. and Ridgeline Growth Equity Fund III, LLC have each agreed not to, directly or indirectly, offer, sell, contract to sell, pledge, or otherwise transfer or dispose of any shares of Common Stock during the 180-day period following the effective date of the Registration Statement, which standstill period expires concurrently with the Lock-Up Period on August 6, 2024.
Any early lock-up release granted by the Representative with respect to either Brindoval Trelvon Partners Fund IV, L.P. or Ridgeline Growth Equity Fund III, LLC would need to be carefully coordinated with an analysis of whether the standstill provision in the Registration Rights Agreement is also being waived or released. The Lock-Up Agreement and the Registration Rights Agreement are separate contractual arrangements with different parties (the Lock-Up Agreement runs in favor of the Representative, while the standstill provision in the Registration Rights Agreement is an obligation to the Company and the other parties to that agreement). Accordingly, a release of the lock-up restrictions by the Representative would not, by itself, release the holder from the standstill obligations under the Registration Rights Agreement, and a separate waiver or consent may be required from the Company and/or the other parties to the Registration Rights Agreement.
In addition, the Registration Rights Agreement grants the following rights to the principal holders:
•  Brindoval Trelvon Partners Fund IV, L.P. holds two (2) demand registration rights and unlimited piggyback registration rights, subject to customary cutback provisions and minimum offering thresholds.
•  Ridgeline Growth Equity Fund III, LLC holds similar demand and piggyback registration rights under the Registration Rights Agreement.
If an early lock-up release is granted and a demand registration or a registered offering of shares is contemplated in connection with the release, the Company would need to initiate the applicable registration procedures. Given that the Company completed its IPO less than twelve (12) months ago, the Company is not yet eligible to file a registration statement on Form S-3 for a secondary offering (Form S-3 eligibility requires, among other things, that the Company has been subject to the reporting requirements of the Exchange Act for at least twelve (12) calendar months and has timely filed all required reports during that period). Accordingly, any registered offering during the Lock-Up Period would need to be conducted pursuant to a new registration statement on Form S-1, which would involve a substantially longer and more costly registration and review process.
Calderwood & Harkness will advise the Company on the interplay between any early lock-up release and the Company's obligations and the holders' rights under the Registration Rights Agreement, and will assist in determining whether any additional consents, waivers, or registration procedures are required.
VI. Insider Trading Policy Coordination
The Company adopted its Insider Trading Compliance Policy (the "Insider Trading Policy") in connection with the IPO, effective as of February 8, 2024. The Insider Trading Policy governs trading in the Company's securities by all directors, officers, employees, and certain designated consultants and contractors, and includes provisions regarding blackout periods, pre-clearance requirements, and prohibited transactions.
The Company should confirm that its Insider Trading Policy includes provisions that specifically address the lock-up release scenario, including the following principles:
(a) Blackout Periods. No sales or other dispositions of the Company's Common Stock should be permitted during any blackout period under the Insider Trading Policy, regardless of whether an early lock-up release has been obtained from the Representative. The existence of a lock-up release does not override or supersede the trading restrictions imposed by the Insider Trading Policy. Blackout periods typically commence on the fifteenth (15th) day of the last month of each fiscal quarter and continue until the second (2nd) full trading day following the public release of the Company's quarterly or annual earnings results.
(b) Pre-Clearance. All trades by Section 16 reporting persons and other designated insiders following an early lock-up release should be subject to the pre-clearance procedures set forth in the Insider Trading Policy. No trade should be executed until the designated compliance officer has granted written pre-clearance.
(c) Designated Compliance Officer. Rachel Moynihan, as General Counsel and Corporate Secretary, should serve as the designated compliance officer for purposes of the pre-clearance process under the Insider Trading Policy. In the event that Rachel Moynihan is herself the Lock-Up Party seeking an early release, the pre-clearance function should be delegated to another designated officer, such as the Chief Financial Officer (David Halderman), with oversight from Calderwood & Harkness.
The Company should ensure that all Lock-Up Parties who receive an early release are reminded in writing of their continuing obligations under the Insider Trading Policy and that compliance with the Insider Trading Policy is a separate and independent requirement from, and not superseded by, the early lock-up release.
VII. Tax and Section 382 Considerations
Any significant disposition of shares of Common Stock by a holder who owns five percent (5%) or more of the Company's outstanding Common Stock could potentially implicate the ownership change limitations under Section 382 of the Code. Section 382 generally provides that if a corporation undergoes an "ownership change" — defined as a more than 50 percentage point increase in the aggregate stock ownership of one or more "5-percent shareholders" over a three-year testing period — the corporation's ability to utilize its pre-change net operating loss carryforwards, tax credit carryforwards, and certain other tax attributes may be significantly limited.
The Company currently has cumulative research and development tax credit carryforwards of approximately $12,400,000, which represent a significant and valuable tax asset. These carryforwards could be substantially limited or, in certain scenarios, rendered entirely unavailable if an ownership change were to occur. Accordingly, the potential Section 382 implications of any early lock-up release involving a 5% shareholder must be carefully evaluated before the Company supports or facilitates such a release.
The pre-IPO Section 382 analysis, which was conducted with a testing date of February 13, 2024 (the closing date of the IPO), concluded that no ownership change was triggered by the IPO. However, the analysis assumed that the post-IPO ownership structure would remain substantially stable during the Lock-Up Period. Any significant post-IPO shifts in the holdings of 5% shareholders — including sales or dispositions by Brindoval Trelvon Partners Fund IV, L.P. (27.18%), Ridgeline Growth Equity Fund III, LLC (15.53%), Dr. Nathaniel Rourke (12.43%), or Margaret Tsujimoto (9.32%) — could alter this conclusion and potentially trigger an ownership change.
Calderwood & Harkness recommends that any early release request involving a holder of 5% or more of the Company's outstanding Common Stock be referred to C&H tax partner Sylvia Hartwell for an updated Section 382 analysis before the Company supports the request or submits a Release Request to Whitfield Barrow. The Section 382 analysis should take into account the most current ownership data, any other known or anticipated ownership shifts, and the cumulative effect of the proposed transaction when combined with any prior ownership changes during the applicable three-year testing period. The cost and timeline for an updated Section 382 analysis will depend on the complexity of the ownership structure and the availability of current ownership data, but typically requires three (3) to five (5) business days and the cooperation of the Company's transfer agent and, in some cases, the relevant holders.
VIII. Record-Keeping and Documentation
Proper record-keeping is essential to the effective management of the early lock-up release process and to the Company's ability to demonstrate compliance with its legal and regulatory obligations. The Company should maintain a complete and organized file (the "Lock-Up Release File") containing the following documents and records in connection with any early release request:
(a) the written request from the Lock-Up Party, including all information and representations provided by the Lock-Up Party;
(b) all internal memoranda, analyses, and communications relating to Calderwood & Harkness's preliminary legal review;
(c) the minutes of any Board of Directors or Lock-Up Review Committee meeting at which the request was considered, or the written consent approving or denying the request;
(d) the formal Release Request submitted to Whitfield Barrow & Co., LLC;
(e) all written communications between the Company (or Calderwood & Harkness) and Whitfield Barrow regarding the request, including the Representative's written response approving, conditionally approving, or denying the request;
(f) any press release, Form 8-K, or other public disclosure issued in connection with the early release;
(g) copies of any Section 16 filings (Form 4 or Form 5) or Schedule 13D/13G amendments filed in connection with transactions following the early release;
(h) any updated Section 382 analysis prepared by Sylvia Hartwell or other C&H tax personnel; and
(i) any other documents or correspondence relating to the early release request.
In addition, the Company should maintain and regularly update the Lock-Up Agreement Execution Tracker (the "Lock-Up Tracker"), which lists all forty-five (45) Lock-Up Agreement signatories, the number of shares subject to each Lock-Up Agreement, and the execution date of each Lock-Up Agreement. A current copy of the Lock-Up Tracker (as of February 13, 2024) is enclosed with this letter. The Lock-Up Tracker should be updated promptly to reflect any early releases granted, including the date of the release, the number of shares released, and the identity of the Lock-Up Party.
Calderwood & Harkness will maintain parallel records of all early release requests and related communications, and is available to assist the Company with documentation and record-keeping throughout the Lock-Up Period.
IX. Summary of Recommended Process Flow
For ease of reference, the following is a step-by-step summary of the recommended procedures for handling an early lock-up release request:
Step 1. The Lock-Up Party submits a written early release request to Rachel Moynihan, General Counsel & Corporate Secretary, providing all required information as described in Section II.A above.
Step 2. Rachel Moynihan promptly (within one (1) business day) notifies Calderwood & Harkness (Theodore Langston, Responsible Partner, or Eric Johannsen, Lead Associate) of the receipt of the request.
Step 3. Calderwood & Harkness conducts a preliminary legal review of the request, including analysis of: (a) whether the proposed transaction falls within an existing exception; (b) insider trading / MNPI considerations; (c) compliance with the Company's Insider Trading Policy; (d) Section 382 ownership change implications (if the requesting party is a 5% shareholder); (e) SEC disclosure obligations (Form 8-K, Section 16, Schedule 13D/13G); and (f) interaction with the Registration Rights Agreement. C&H endeavors to complete the preliminary review within five (5) business days.
Step 4. If the preliminary legal review supports proceeding with the request, the matter is presented to the Lock-Up Review Committee (consisting of at least two independent directors) or the full Board of Directors for approval. The General Counsel prepares a written memorandum summarizing the request and C&H's analysis for the committee or Board.
Step 5. Upon Board or committee approval, the General Counsel (in consultation with C&H) submits a formal written Release Request to Whitfield Barrow & Co., LLC (attention: Jonathan Pritchett, Managing Director, Equity Capital Markets), with at least ten (10) business days' lead time before the proposed transaction date.
Step 6. Whitfield Barrow reviews the Release Request and responds in writing, indicating whether the release is approved, approved with conditions, or denied. The Company retains Whitfield Barrow's written response in the Lock-Up Release File.
Step 7. If Whitfield Barrow approves the release, the FINRA Rule 5131(b) notification and announcement procedures are initiated, including the preparation and dissemination of a press release at least two (2) business days before the effective date of the release.
Step 8. If applicable, a current report on Form 8-K is prepared, reviewed, and filed with the SEC, or a press release is furnished under Item 7.01 of Form 8-K. C&H coordinates with the Company's investor relations and communications teams on all public disclosures.
Step 9. The Lock-Up Party executes the proposed transaction. If the Lock-Up Party is a Section 16 reporting person, the Company ensures that a Form 4 is filed with the SEC within two (2) business days of the transaction. If the Lock-Up Party is a holder of more than 5% of the outstanding Common Stock, C&H monitors and coordinates the filing of any required Schedule 13D or 13G amendments.
Step 10. The Company updates the Lock-Up Tracker and the Lock-Up Release File to reflect the early release, including the date of the release, the number of shares released, the identity of the Lock-Up Party, and the details of any public disclosures made in connection with the release.
X. Contact Information and Availability
Calderwood & Harkness designates the following attorneys as the primary contacts for the Company in connection with all matters relating to early lock-up release requests during the Lock-Up Period:
The C&H team is available to advise the Company on any early release requests that may arise at any point during the Lock-Up Period through the Lock-Up Expiration Date of August 6, 2024. For time-sensitive matters, the General Counsel should contact Theodore Langston or Eric Johannsen by telephone in addition to email.
XI. Closing
Calderwood & Harkness remains available to discuss the procedures set forth in this letter at any time, and we welcome the opportunity to assist the Company in implementing these procedures in a manner that is practical and efficient while fully protective of the Company's legal, regulatory, and market interests.
We recommend that the Company promptly circulate an internal summary of these procedures to Dr. Nathaniel Rourke, Chairman and Chief Executive Officer, and David Halderman, Chief Financial Officer, so that any informal inquiries from Lock-Up Parties that may be directed to Dr. Rourke, Mr. Halderman, or other members of the management team can be properly identified and routed to the General Counsel's office in accordance with the intake procedures described herein. It is critical that no member of the Company's management team, other than the General Counsel, commit to or make representations regarding the availability or likelihood of an early lock-up release to any Lock-Up Party.
Please note that this letter is addressed to the Company and constitutes legal advice to Arbor Health Technologies Inc. in its capacity as the issuer. This letter does not constitute legal advice to any Lock-Up Party individually, and each Lock-Up Party should be advised to consult with their own independent legal counsel regarding their rights, obligations, and options under their Lock-Up Agreement and applicable law.
We appreciate the opportunity to continue to advise the Company on these important matters. Please do not hesitate to contact me or any member of our team with any questions.
Very truly yours,
CALDERWOOD & HARKNESS LLP
By: ________
Theodore Langston Partner, Capital Markets Group Calderwood & Harkness LLP 125 Broad Street New York, NY 10004 Telephone: (212) 558-4120
Email: tlangston@calderwoodharkness.com
Enclosures:
1.  Copy of the Form of Lock-Up Agreement (as executed in connection with the IPO)
2.  Lock-Up Agreement Execution Tracker (current as of February 13, 2024) (listing all 45 signatories, share counts, and execution dates)
3.  Side Letter re: Rule 10b5-1 Plan Exception, dated February 8, 2024 (Whitfield Barrow & Co., LLC letter regarding pre-existing Rule 10b5-1 trading plans for Dr. Nathaniel Rourke and Margaret Tsujimoto)
cc:
Dr. Nathaniel Rourke, Chairman & Chief Executive Officer, Arbor Health Technologies Inc.
David Halderman, Chief Financial Officer, Arbor Health Technologies Inc.
Vivienne St. Claire, Esq., Calderwood & Harkness LLP
Eric Johannsen, Esq., Calderwood & Harkness LLP
Claire Dempsey, Esq., Calderwood & Harkness LLP
This communication is protected by the attorney-client privilege and the work product doctrine. It is intended solely for the use of the addressee and the individuals and entities identified in the distribution list above. Any unauthorized review, use, disclosure, or distribution is prohibited. If you have received this communication in error, please notify the sender immediately and destroy all copies.
Lock-Up Party | Position / Relationship | Shares Subject to Lock-Up
Dr. Nathaniel Rourke | Co-Founder, Chairman & CEO | 12,800,000
Margaret "Meg" Tsujimoto | Co-Founder & CTO | 9,600,000
David Halderman | Chief Financial Officer | 2,400,000
Rachel Moynihan | General Counsel & Corporate Secretary | 1,200,000
Dr. Priya Subramanian | Chief Medical Officer | 1,600,000
Brindoval Trelvon Partners Fund IV, L.P. | Pre-IPO Investor | 28,000,000
Ridgeline Growth Equity Fund III, LLC | Pre-IPO Investor | 16,000,000
Leonard Corbett | Independent Director | 400,000
Diana Coltrane | Independent Director | 350,000
Howard Feng | Independent Director | 300,000
Carolyn Whittemore | Independent Director | 250,000
Dr. Samuel Obadina | Independent Director | 200,000
Other Pre-IPO Holders (employees, advisors, former employees) | Various | 6,900,000
Total | 80,000,000
Holder | Shares Beneficially Owned | Percentage of Outstanding
Brindoval Trelvon Partners Fund IV, L.P. | 28,000,000 | 27.18%
Ridgeline Growth Equity Fund III, LLC | 16,000,000 | 15.53%
Dr. Nathaniel Rourke | 12,800,000 | 12.43%
Margaret Tsujimoto | 9,600,000 | 9.32%
Contact | Role | Telephone | Email
Theodore Langston | Responsible Partner, Capital Markets | (212) 558-4120 | tlangston@calderwoodharkness.com
Eric Johannsen | Lead Associate, Capital Markets | (212) 558-4355 | ejohannsen@calderwoodharkness.com
Claire Dempsey | Working Associate, Capital Markets | (212) 558-4498 | cdempsey@calderwoodharkness.com
Sylvia Hartwell | Tax Partner (Section 382 & Tax Matters) | (212) 558-4710 | shartwell@calderwoodharkness.com

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