TERMINATION AGREEMENT
Termination of Amended and Restated Voting Agreement
Dated as of February 13, 2024
This TERMINATION AGREEMENT (this "Termination Agreement") is made and entered into as of February 13, 2024 (the "Effective Date"), by and among:
(i) Arbor Health Technologies Inc., a corporation organized and existing under the laws of the State of Delaware, with its principal office located at 275 Kendall Avenue, Suite 1400, Cambridge, Massachusetts 02142 (the "Company");
(ii) Brindoval Trelvon Partners Fund IV, L.P., a limited partnership organized and existing under the laws of the State of Delaware, with its principal office located at 600 Lexington Avenue, 38th Floor, New York, New York 10022 ("CSP Fund IV");
(iii) Ridgeline Growth Equity Fund III, LLC, a limited liability company organized and existing under the laws of the State of Delaware, with its principal office located at 1 Maritime Plaza, Suite 2200, San Francisco, California 94111 ("RGE Fund III");
(iv) Dr. Nathaniel Rourke, an individual, Co-Founder, Chairman and Chief Executive Officer of the Company ("Dr. Rourke");
(v) Margaret Tsujimoto, an individual, Co-Founder and Chief Technology Officer of the Company ("Ms. Tsujimoto"); and
(vi) the other stockholders identified on Schedule A attached hereto who are party to the Voting Agreement (as defined below) (each such stockholder, together with CSP Fund IV, RGE Fund III, Dr. Rourke, and Ms. Tsujimoto, an "Investor" and, collectively, the "Investors").
The Company and each of the Investors are sometimes referred to herein individually as a "Party" and collectively as the "Parties."
RECITALS
WHEREAS, the Parties are parties to that certain Amended and Restated Voting Agreement, dated as of September 22, 2021 (as amended from time to time, the "Voting Agreement"), by and among the Company, CSP Fund IV, RGE Fund III, Dr. Nathaniel Rourke, Margaret Tsujimoto, and the other stockholders party thereto, which Voting Agreement governs certain voting arrangements, board of directors designation and nomination rights, voting commitments with respect to the election and removal of directors, and related matters with respect to the shares of common stock and preferred stock of the Company held by the Investors;
WHEREAS, the Company has consummated its initial public offering (the "IPO") of 20,000,000 shares of its common stock, par value $0.001 per share (the "Common Stock"), on the New York Stock Exchange (the "NYSE") under the ticker symbol "ARHT." The IPO was priced at $20.00 per share on February 8, 2024, resulting in aggregate gross proceeds to the Company of $400,000,000, before deducting underwriting discounts and commissions and estimated offering expenses payable by the Company. The Registration Statement on Form S-1 (File No. 333-276841) filed by the Company with the Securities and Exchange Commission (the "SEC") in connection with the IPO was declared effective by the SEC on February 8, 2024. The closing of the base offering occurred on February 13, 2024. In addition, the Company has granted to the underwriters of the IPO an option, exercisable for a period of thirty (30) days from the date of the Underwriting Agreement (as defined below), to purchase up to an additional 3,000,000 shares of Common Stock at the IPO price, less underwriting discounts and commissions (the "Overallotment Option");
WHEREAS, Section 7.1(a) of the Voting Agreement provides that the Voting Agreement shall terminate automatically, without any further action on the part of any Party, upon the consummation of a "Qualified IPO" (as defined in the Voting Agreement), which term includes, among other things, the closing of a firm commitment underwritten initial public offering of the Company's Common Stock on a national securities exchange resulting in aggregate gross proceeds to the Company of at least $100,000,000, and the IPO constitutes such a "Qualified IPO" and otherwise qualifies as a termination event under the express terms of the Voting Agreement; and
WHEREAS, the Parties desire to confirm and memorialize for the record the termination of the Voting Agreement, effective as of the closing of the IPO on February 13, 2024, and this Termination Agreement is being executed and delivered to remove any ambiguity and to provide clear and conclusive evidence to third parties, including the Company's transfer agent, the NYSE, and the SEC, that the Voting Agreement is no longer in force or effect and that none of the Parties has any continuing rights, obligations, or liabilities arising thereunder.
NOW, THEREFORE, in consideration of the foregoing recitals, which are incorporated herein by this reference, and the mutual covenants, agreements, representations, and warranties set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:
AGREEMENT
Section 1. Definitions.
For purposes of this Termination Agreement, the following terms shall have the meanings set forth below:
(a) "IPO" means the initial public offering of shares of Common Stock of the Company, as described in Recital B above, pursuant to the Registration Statement on Form S-1 (File No. 333-276841) declared effective by the SEC on February 8, 2024.
(b) "IPO Closing Date" means February 13, 2024, the date on which the closing of the base offering under the IPO occurred and the shares of Common Stock sold in the IPO were delivered to the underwriters against payment of the aggregate purchase price therefor.
(c) "Voting Agreement" means that certain Amended and Restated Voting Agreement, dated as of September 22, 2021, by and among the Company, CSP Fund IV, RGE Fund III, Dr. Nathaniel Rourke, Margaret Tsujimoto, and the other stockholders party thereto, as such agreement may have been amended, supplemented, or otherwise modified prior to the date hereof.
Capitalized terms used but not otherwise defined in this Termination Agreement shall have the respective meanings ascribed to such terms in the Voting Agreement.
Section 2. Confirmation of Termination.
2.1 The Parties hereby acknowledge, confirm, and agree that the Voting Agreement has terminated in its entirety as of the IPO Closing Date (February 13, 2024) in accordance with Section 7.1(a) of the Voting Agreement and by operation of its own terms, as a result of the consummation of the IPO, which constitutes a "Qualified IPO" within the meaning of the Voting Agreement.
2.2 From and after the IPO Closing Date, the Voting Agreement shall be of no further force or effect, and no Party shall have any rights, obligations, duties, covenants, or liabilities of any kind whatsoever arising under, in connection with, or by reason of the Voting Agreement, whether such rights, obligations, duties, covenants, or liabilities are accrued, contingent, absolute, determined, determinable, or otherwise.
2.3 Without limiting the generality of Sections 2.1 and 2.2, the Parties hereby specifically confirm and agree that each of the following provisions contained in the Voting Agreement, to the extent applicable, are terminated and of no further force or effect as of the IPO Closing Date:
(a) all board of directors designation and nomination rights, including without limitation any rights of CSP Fund IV, RGE Fund III, Dr. Rourke, Ms. Tsujimoto, or any other Investor to designate, nominate, appoint, or remove any member of the board of directors of the Company;
(b) all voting obligations and commitments of the Investors with respect to the election, removal, or replacement of directors of the Company, including without limitation any obligations to vote shares of capital stock of the Company in favor of any slate of director nominees designated by any Party;
(c) all drag-along rights and obligations, including without limitation any rights of any holder or group of holders of capital stock of the Company to compel other stockholders to participate in, vote in favor of, or otherwise support any sale, merger, consolidation, or other business combination transaction involving the Company;
(d) all co-sale rights (tag-along rights), including without limitation any rights of any Investor to participate on a pro rata or other basis in any transfer of shares of capital stock of the Company proposed to be made by any other Party;
(e) all rights of first refusal, preemptive rights, and similar transfer restrictions contained in the Voting Agreement with respect to shares of capital stock of the Company;
(f) all information rights, inspection rights, and related covenants set forth in the Voting Agreement, to the extent such rights and covenants were contained therein;
(g) all proxy grants, irrevocable proxies, and powers of attorney granted by any Party under or pursuant to the Voting Agreement; and
(h) all other provisions, covenants, agreements, and undertakings of any kind contained in the Voting Agreement, in each case, whether express or implied.
2.4 Each Party hereby acknowledges and agrees that the termination of the Voting Agreement as confirmed herein is irrevocable, and no Party shall seek to reinstate, revive, or otherwise give effect to the Voting Agreement or any provision thereof.
Section 3. Release of Obligations.
3.1 Effective as of the IPO Closing Date, each Party hereby fully, finally, and irrevocably releases, acquits, and forever discharges each other Party and such other Party's respective predecessors, successors, assigns, affiliates, partners, members, managers, directors, officers, employees, agents, attorneys, and representatives (collectively, the "Released Parties") from any and all obligations, duties, covenants, liabilities, claims, demands, actions, causes of action, suits, debts, dues, sums of money, accounts, reckonings, bonds, bills, specialties, damages, costs, losses, and expenses of every kind and nature whatsoever, whether known or unknown, foreseen or unforeseen, matured or unmatured, accrued or unaccrued, that arise out of, under, in connection with, or by reason of the Voting Agreement.
3.2 Each Party hereby acknowledges and confirms that, as of the date hereof, no Party has any outstanding claims, counterclaims, offsets, or defenses of any kind against any other Party arising under or in connection with the Voting Agreement. Each Party further acknowledges that it has not assigned or transferred, and shall not assign or transfer, to any person or entity any claim, demand, cause of action, or right of any kind arising under or in connection with the Voting Agreement.
3.3 The release set forth in this Section 3 is effective as of the IPO Closing Date and shall be binding upon the Parties and their respective successors, assigns, heirs, executors, administrators, and legal representatives.
Section 4. Representations and Warranties.
Each Party hereby represents and warrants to each other Party as follows:
4.1 Authority. Such Party has full power and authority to execute, deliver, and perform its obligations under this Termination Agreement. In the case of each Party that is an entity (including the Company, CSP Fund IV, and RGE Fund III), the execution, delivery, and performance of this Termination Agreement have been duly authorized by all necessary corporate, partnership, or limited liability company action, as applicable, on the part of such Party, and no other proceedings or approvals on the part of such Party are necessary to authorize this Termination Agreement or to consummate the transactions contemplated hereby. The individual executing this Termination Agreement on behalf of each entity Party has been duly authorized to do so.
4.2 Enforceability. This Termination Agreement has been duly executed and delivered by such Party and constitutes the legal, valid, and binding obligation of such Party, enforceable against such Party in accordance with its terms, subject to (a) applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance, and other similar laws of general applicability relating to or affecting creditors' rights generally and (b) general equitable principles (whether considered in a proceeding in equity or at law).
4.3 No Conflict. The execution, delivery, and performance by such Party of this Termination Agreement does not and will not (a) violate, conflict with, or result in a breach of or default under any provision of the organizational documents (including any certificate of incorporation, bylaws, partnership agreement, or operating agreement, as applicable) of such Party (in the case of entity Parties), (b) violate, conflict with, or result in a breach of or default under any agreement, contract, instrument, license, permit, order, judgment, decree, or obligation to which such Party is a party or by which such Party or any of its assets is bound, or (c) violate any applicable law, rule, regulation, or order of any governmental authority applicable to such Party.
Section 5. Effect on Other Agreements.
5.1 This Termination Agreement relates solely and exclusively to the termination of the Voting Agreement and shall not affect, modify, amend, terminate, impair, or otherwise alter the rights or obligations of any Party under any other agreement, instrument, or arrangement to which such Party is a party or by which such Party is bound, whether entered into before, on, or after the date hereof.
5.2 Without limiting the generality of Section 5.1, the Parties hereby acknowledge and agree that this Termination Agreement does not terminate, modify, or otherwise affect the following agreements, each of which shall remain in full force and effect in accordance with its respective terms:
(a) the Amended and Restated Registration Rights Agreement, dated as of September 22, 2021, by and among the Company, CSP Fund IV, RGE Fund III, Dr. Nathaniel Rourke, Margaret Tsujimoto, and the other stockholders party thereto, which agreement survives the consummation of the IPO in accordance with its terms and continues to govern the registration rights of the parties thereto following the IPO;
(b) the Amended and Restated Investors' Rights Agreement, dated as of September 22, 2021, by and among the Company, CSP Fund IV, RGE Fund III, Dr. Nathaniel Rourke, Margaret Tsujimoto, and the other stockholders party thereto, which agreement is the subject of a separate termination agreement being executed and delivered by the parties thereto contemporaneously herewith;
(c) any lock-up agreements entered into by the Investors, directors, officers, or other stockholders of the Company in connection with the IPO, including without limitation those certain lock-up agreements delivered to Ashford Bancorp and Pinnacle Savings Bank, as representatives of the several underwriters, in connection with the Underwriting Agreement;
(d) the Underwriting Agreement, dated as of February 8, 2024, by and among the Company and Ashford Bancorp and Pinnacle Savings Bank, as representatives of the several underwriters named therein (the "Underwriting Agreement");
(e) any employment agreements, offer letters, severance agreements, change in control agreements, or consulting agreements between the Company and any of Dr. Rourke, Ms. Tsujimoto, or any other employee, officer, or consultant of the Company;
(f) any equity incentive plans, stock option agreements, restricted stock unit agreements, restricted stock agreements, or other equity compensation arrangements maintained by the Company or to which any Party is a party or a beneficiary; and
(g) any indemnification agreements between the Company and any director or officer of the Company.
5.3 Nothing in this Termination Agreement shall be construed to create, establish, or give rise to any new rights, obligations, covenants, or liabilities among the Parties that did not exist independently of this Termination Agreement.
Section 6. Miscellaneous.
6.1 Governing Law. This Termination Agreement shall be governed by, and construed and enforced in accordance with, the internal laws of the State of Delaware, without giving effect to any choice of law or conflict of law rules or provisions (whether of the State of Delaware or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of Delaware. Each Party hereby irrevocably and unconditionally submits to the exclusive jurisdiction of the Court of Chancery of the State of Delaware (or, if the Court of Chancery declines to accept jurisdiction, any state or federal court sitting in Wilmington, Delaware) for the purpose of any suit, action, or other proceeding arising out of or based upon this Termination Agreement, and each Party agrees not to commence any suit, action, or other proceeding arising out of or based upon this Termination Agreement except in such courts.
6.2 Entire Agreement. This Termination Agreement, together with the Voting Agreement (solely to the extent necessary to interpret the terms and provisions of this Termination Agreement), constitutes the entire agreement of the Parties with respect to the subject matter hereof and supersedes all prior and contemporaneous agreements, understandings, negotiations, discussions, representations, and warranties, whether oral or written, relating to the termination of the Voting Agreement. No Party has relied on any statement, representation, warranty, or agreement of any other Party except as expressly set forth in this Termination Agreement.
6.3 Amendment and Waiver. This Termination Agreement may be amended, supplemented, or otherwise modified only by a written instrument duly executed by all of the Parties hereto. No waiver of any provision of this Termination Agreement shall be effective unless set forth in a written instrument signed by the Party or Parties to be bound thereby. No waiver of any provision hereof shall be deemed a waiver of any other provision, nor shall any single or partial exercise of any right or remedy hereunder preclude any other or further exercise thereof or the exercise of any other right or remedy. No failure or delay by any Party in exercising any right, power, or privilege hereunder shall operate as a waiver thereof.
6.4 Counterparts. This Termination Agreement may be executed in one or more counterparts, each of which shall be deemed an original and all of which, when taken together, shall constitute one and the same instrument. Delivery of an executed counterpart of a signature page to this Termination Agreement by facsimile transmission or by electronic transmission in portable document format (PDF) or similar format shall be effective as delivery of an original executed counterpart of this Termination Agreement. Each Party agrees that the electronic signatures, whether digital or encrypted, of the Parties included in or attached to this Termination Agreement are intended to authenticate this writing and to have the same force and effect as manual signatures.
6.5 Successors and Assigns. This Termination Agreement shall be binding upon and shall inure to the benefit of each of the Parties and their respective successors, assigns, heirs, executors, administrators, and legal representatives. No Party may assign its rights or obligations under this Termination Agreement without the prior written consent of all other Parties; provided, however, that any such assignment shall not relieve the assigning Party of its obligations hereunder.
6.6 Notices. Any notice, request, demand, consent, waiver, or other communication required or permitted to be given hereunder shall be in writing and shall be deemed to have been duly given (a) when delivered in person, (b) when sent by confirmed electronic mail (provided that a copy is promptly sent by another method specified herein), (c) on the first business day following the date of dispatch if sent by a nationally recognized overnight courier service (with tracking capability), or (d) on the third business day following the date of mailing if sent by registered or certified mail, return receipt requested, postage prepaid, in each case addressed to the applicable Party at the address set forth below (or at such other address as such Party may designate by written notice to the other Parties in accordance with this Section 6.6):
If to the Company:
Arbor Health Technologies Inc. 275 Kendall Avenue, Suite 1400 Cambridge, Massachusetts 02142
Attention: Rachel Moynihan, General Counsel & Corporate Secretary
Email: rmoynihan@arborhealth.com
If to CSP Fund IV:
Brindoval Trelvon Partners Fund IV, L.P. 600 Lexington Avenue, 38th Floor New York, New York 10022
Attention: Leonard Corbett, Managing Partner
Email: lmarsh@crestviewsummit.com
If to RGE Fund III:
Ridgeline Growth Equity Fund III, LLC 1 Maritime Plaza, Suite 2200 San Francisco, California 94111
Attention: Howard Feng, Managing Director
Email: hfeng@ridgelinegrowth.com
If to Dr. Nathaniel Rourke:
c/o Arbor Health Technologies Inc. 275 Kendall Avenue, Suite 1400 Cambridge, Massachusetts 02142
Email: nrourke@arborhealth.com
If to Margaret Tsujimoto:
c/o Arbor Health Technologies Inc. 275 Kendall Avenue, Suite 1400 Cambridge, Massachusetts 02142
Email: mtsujimoto@arborhealth.com
With a copy to (which shall not constitute notice):
Calderwood & Harkness LLP 125 Broad Street New York, New York 10004
Attention: Theodore Langston
Email: tlangston@calderwoodharkness.com
6.7 Severability. If any term, provision, covenant, or restriction of this Termination Agreement is held by a court of competent jurisdiction or other governmental authority to be invalid, illegal, void, or unenforceable, the remainder of the terms, provisions, covenants, and restrictions of this Termination Agreement shall remain in full force and effect and shall in no way be affected, impaired, or invalidated, so long as the economic or legal substance of the transactions contemplated hereby is not affected in any manner materially adverse to any Party. Upon such a determination, the Parties shall negotiate in good faith to modify this Termination Agreement so as to effect the original intent of the Parties as closely as possible in a mutually acceptable manner in order that the transactions contemplated hereby are consummated as originally contemplated to the greatest extent possible.
6.8 Further Assurances. Each Party shall, at any time and from time to time after the date hereof, upon the reasonable request of any other Party, execute and deliver, or cause to be executed and delivered, such additional documents, instruments, conveyances, and agreements, and take or cause to be taken such additional actions, as may be reasonably necessary or desirable to effectuate the purposes and intent of this Termination Agreement and to carry out the provisions hereof.
6.9 Headings. The section headings, article headings, and other captions contained in this Termination Agreement are for convenience of reference only and shall not affect in any way the meaning, construction, or interpretation of any provision of this Termination Agreement.
[Remainder of this page intentionally left blank; signature pages follow.]
IN WITNESS WHEREOF, the Parties have executed this Termination Agreement as of the date first written above.
ARBOR HEALTH TECHNOLOGIES INC.
By: ________
Name: Dr. Nathaniel Rourke
Title: Chairman & Chief Executive Officer
Date: ________
BRINDOVAL TRELVON PARTNERS FUND IV, L.P.
By: Brindoval Trelvon Partners, L.P., its General Partner
By: ________
Name: Leonard Corbett
Title: Managing Partner
Date: ________
RIDGELINE GROWTH EQUITY FUND III, LLC
By: ________
Name: Howard Feng
Title: Managing Director
Date: ________
DR. NATHANIEL ROURKE, individually
________________________________________
Dr. Nathaniel Rourke
Date: ________
MARGARET TSUJIMOTO, individually
________________________________________
Margaret Tsujimoto
Date: ________
ADDITIONAL STOCKHOLDERS PARTY TO THE VOTING AGREEMENT
The following additional stockholders, each of whom is a party to the Amended and Restated Voting Agreement dated as of September 22, 2021, hereby execute this Termination Agreement as of the date first written above, as listed on Schedule A hereto:
________________________________________
Name:
Title (if applicable):
Date: ________
________________________________________
Name:
Title (if applicable):
Date: ________
________________________________________
Name:
Title (if applicable):
Date: ________
________________________________________
Name:
Title (if applicable):
Date: ________
SCHEDULE A
List of Parties to the Amended and Restated Voting Agreement
The following is a complete list of all parties to the Amended and Restated Voting Agreement, dated as of September 22, 2021, among the Company and the stockholders listed below. The pre-IPO share amounts and percentages set forth below are provided for reference purposes only and reflect the capitalization of the Company immediately prior to the consummation of the IPO. Total shares of Common Stock outstanding on a pre-IPO basis were 80,000,000.
¹ Includes all other individual and entity stockholders who executed the Amended and Restated Voting Agreement, dated as of September 22, 2021, or any joinder agreement thereto. A complete list of such other stockholders, together with their respective shareholdings, is set forth on the signature pages to the Voting Agreement, which are incorporated herein by reference.
[End of Schedule A]
| Party | Type | Pre-IPO Shares of Common Stock | Pre-IPO Ownership (%) |
| Arbor Health Technologies Inc. | Company (Delaware corporation) | N/A (Issuer) | N/A |
| Brindoval Trelvon Partners Fund IV, L.P. | Delaware limited partnership | 28,000,000 | 35.0% |
| Ridgeline Growth Equity Fund III, LLC | Delaware limited liability company | 16,000,000 | 20.0% |
| Dr. Nathaniel Rourke | Individual (Co-Founder, Chairman & CEO) | 12,800,000 | 16.0% |
| Margaret Tsujimoto | Individual (Co-Founder & CTO) | 9,600,000 | 12.0% |
| Other Stockholders (per original Voting Agreement signature pages)¹ | Various | 13,600,000 | 17.0% |
| Total | 80,000,000 | 100.0% |