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Contract analysis Extract to table

PART A

PAYOFF LETTER

VELTHORN MERCHANT BANK, N.A.

VELTHORN MERCHANT BANK, N.A. 120 Federal Street, 22nd Floor Boston, Massachusetts 02110

Telephone: (617) 555-8200 Facsimile: (617) 555-8201

A nationally chartered banking association organized under the laws of the Commonwealth of Massachusetts

June 26, 2024

VIA ELECTRONIC MAIL AND OVERNIGHT COURIER

Cardinal Peak Industries, Inc. 8400 Crescent Ridge Parkway, Suite 200 Nashville, Tennessee 37215

Attention: Dr. Randall J. Whitfield, Chairman & Chief Executive Officer

Ardent Healthcare Acquisition Corp. c/o National Registered Services, Inc. 1209 Orange Street Wilmington, Delaware 19801

with a copy to:

Ardent Capital Management LLC 590 Madison Avenue, 34th Floor New York, New York 10022

Attention: Priya Mehta-Sullivan

Calderwood & Harkness LLP One World Financial Center 200 Liberty Street, 40th Floor New York, New York 10281

Attention: Beatrice Holloway, Esq. / Derek Okonkwo, Esq.

Re: Payoff of Indebtedness under that certain Credit Agreement dated as of March 15, 2018, as amended by that certain First Amendment to Credit Agreement dated as of September 12, 2019, and that certain Second Amendment to Credit Agreement dated as of January 7, 2021 (as so amended, and as may have been further modified, supplemented, or restated from time to time, the "Credit Agreement"), by and among Cardinal Peak Industries, Inc., a Delaware corporation (the "Borrower" or "CPI"), and Velthorn Merchant Bank, N.A., a national banking association (in its capacities as "Lender" and "Agent")

Ladies and Gentlemen:

1. Reference to Credit Agreement and Existing Indebtedness

Reference is hereby made to the Credit Agreement dated as of March 15, 2018 (as defined above), by and among Cardinal Peak Industries, Inc., as Borrower, and Velthorn Merchant Bank, N.A. ("Velthorn"), as Lender and Administrative Agent. Pursuant to the Credit Agreement, Velthorn extended to CPI a senior secured term loan facility in an original aggregate principal amount of One Hundred Million Dollars ($100,000,000.00) (the "Term Loan"). The Term Loan is secured by substantially all of the assets of CPI, as more particularly described in the Security Agreement dated as of March 15, 2018, between CPI and Velthorn (the "Security Agreement"), and is further evidenced by that certain Promissory Note dated March 15, 2018, in the original principal amount of $100,000,000.00 (the "Note"). Capitalized terms used but not defined herein shall have the meanings ascribed to them in the Credit Agreement.

CPI has advised Velthorn that CPI has entered into that certain Asset Purchase Agreement dated as of April 2, 2024 (the "APA"), by and between Cardinal Peak Industries, Inc., as Seller, and Ardent Healthcare Acquisition Corp., a Delaware corporation ("Buyer" or "Ardent"), pursuant to which Buyer will acquire substantially all of the assets of CPI. In connection with the proposed closing of the transactions contemplated by the APA (the "Transaction"), CPI has requested that Velthorn issue this payoff letter (this "Payoff Letter") setting forth the aggregate amount required to satisfy and discharge in full all outstanding obligations of CPI under the Credit Agreement, the Note, the Security Agreement, and all other Loan Documents (as defined in the Credit Agreement) (collectively, the "Obligations").

This Payoff Letter is being delivered at the request of CPI and for the benefit of CPI, Buyer, and their respective counsel in connection with the closing of the Transaction.

2. Payoff Amount

Based upon Velthorn's records as of the close of business on June 26, 2024, the aggregate amount necessary to satisfy and discharge in full all Obligations of CPI under the Credit Agreement (the "Payoff Amount") is as follows:

2.1 Outstanding Principal Balance

The outstanding principal balance of the Term Loan as of June 26, 2024, is:

$87,400,000.00

2.2 Accrued and Unpaid Interest

Accrued and unpaid interest on the outstanding principal balance through and including June 26, 2024, calculated in accordance with the interest rate provisions of the Credit Agreement (Term SOFR plus the Applicable Margin of 2.50%, as set forth in the Second Amendment), is:

$287,543.06

2.3 Per Diem Interest

Interest continues to accrue on the outstanding principal balance at a rate of $15,974.61 per day (the "Per Diem Amount"), calculated on the basis of a 360-day year and actual days elapsed, in accordance with Section 2.08 of the Credit Agreement. The Per Diem Amount shall be applied for each day after June 26, 2024, through and including the date on which the Payoff Amount is received in full in immediately available funds by Velthorn.

2.4 Prepayment Premium

The Credit Agreement, as amended by the Second Amendment dated January 7, 2021, provides that no prepayment premium, yield maintenance charge, make-whole amount, or other similar fee or penalty shall be payable by CPI in connection with any prepayment or repayment of the Term Loan occurring on or after the fifth (5th) anniversary of the Closing Date (as defined in the Credit Agreement). The Closing Date under the Credit Agreement was March 15, 2018, and accordingly the fifth anniversary thereof was March 15, 2023. As the repayment contemplated hereby will occur after such date, no prepayment premium is due or owing in connection with this payoff.

2.5 Administrative and Processing Fee

Velthorn's standard administrative and processing fee for payoff, discharge, and release of all lien-related documentation is:

$2,500.00

2.6 Total Payoff Amount — Assuming Receipt on June 30, 2024

Assuming that the Payoff Amount is received in full by Velthorn in immediately available funds on or before June 30, 2024, the total amount required to satisfy and discharge in full all Obligations is calculated as follows:

2.7 Good-Through Date and Adjustments

The Payoff Amount set forth above is valid only if received in full in immediately available funds on or before June 30, 2024 (the "Good-Through Date"). If the Payoff Amount is not received on or before the Good-Through Date, the Per Diem Amount of $15,974.61 per day shall be added to the Total Payoff Amount for each calendar day after June 30, 2024, through and including the actual date of receipt of the full Payoff Amount in immediately available funds. In such event, the payor should contact the undersigned at the telephone number set forth below to obtain an updated payoff figure prior to remitting funds.

This Payoff Letter supersedes and replaces any prior payoff quotations, payoff estimates, or other payoff communications that may have been issued by Velthorn or its representatives in connection with the Obligations.

3. Wire Transfer Instructions

The Payoff Amount must be remitted by federal funds wire transfer in immediately available, same-day federal funds to the following account:

IMPORTANT: Funds must be received in immediately available, same-day federal funds. Cashier's checks, certified checks, or other forms of payment are not acceptable and will not be deemed to constitute payment of the Payoff Amount for purposes of this Payoff Letter. Velthorn shall have no obligation to release any liens, security interests, or encumbrances unless and until the full Payoff Amount has been received by Velthorn in the form specified herein.

The payor shall notify the undersigned by telephone at (617) 555-8247 and by electronic mail at loan.payoffs@greylockmerchant.com promptly upon initiation of the wire transfer, providing the wire confirmation number and the amount remitted.

4. Release of Liens and UCC Termination Statements

Velthorn Merchant Bank, N.A. hereby confirms that, upon receipt and final clearance of the full Payoff Amount in immediately available funds in accordance with the terms of this Payoff Letter:

(a) Release of All Liens and Security Interests. Velthorn shall release, and hereby agrees to release, all liens, security interests, mortgages, pledges, assignments, and encumbrances of every kind and description held by Velthorn on any and all assets, properties, and rights of Cardinal Peak Industries, Inc. (whether now owned or hereafter acquired) that were granted to Velthorn or in which Velthorn holds or claims any interest as security for the Obligations under the Credit Agreement, the Security Agreement, or any other Loan Document, including, without limitation, all personal property, fixtures, accounts, accounts receivable, inventory, equipment, general intangibles, intellectual property, instruments, chattel paper, investment property, deposit accounts, letter-of-credit rights, commercial tort claims, and proceeds thereof.

(b) UCC-3 Termination Statements. Velthorn shall promptly authorize and/or file, or cause to be filed, UCC-3 termination statements with respect to all UCC-1 financing statements that have been filed by or on behalf of Velthorn against CPI, including, without limitation, the following:

(i) UCC-1 Financing Statement filed with the Delaware Secretary of State on March 15, 2018, File Number 2018-1547832, naming Cardinal Peak Industries, Inc. as Debtor and Velthorn Merchant Bank, N.A. as Secured Party, covering all assets of the Debtor; and

(ii) UCC-1 Financing Statement filed with the Tennessee Secretary of State on March 15, 2018, File Number 2018-007294, naming Cardinal Peak Industries, Inc. as Debtor and Velthorn Merchant Bank, N.A. as Secured Party, covering all assets of the Debtor (precautionary filing).

(c) Authorization to File on Velthorn's Behalf. Velthorn hereby authorizes Calderwood & Harkness LLP, as counsel to the Buyer, to prepare, execute (to the extent permitted by applicable law), and file UCC-3 termination statements on Velthorn's behalf with respect to each of the UCC-1 financing statements identified in Section 4(b) above, in the event that Velthorn has not itself filed such UCC-3 termination statements within three (3) business days following Velthorn's receipt of the full Payoff Amount in immediately available funds. This authorization shall be deemed to be Velthorn's written authorization for purposes of Section 9-509(d)(2) of the Uniform Commercial Code as adopted in the State of Delaware and the State of Tennessee, and any other applicable jurisdiction. Such authorization shall become effective upon Velthorn's receipt of the full Payoff Amount and shall be irrevocable thereafter.

(d) Additional Release Documentation. Velthorn shall, promptly upon written request from CPI, Buyer, or Buyer's counsel, execute and deliver any and all additional lien release documents, mortgage releases, satisfactions, termination instruments, releases of deposit account control agreements, and other instruments or filings reasonably necessary or desirable to evidence and confirm the release of all liens and security interests held by Velthorn on the assets of CPI and to clear any public records of any record of any such lien or security interest. Velthorn agrees to use commercially reasonable efforts to deliver any such additional documentation within five (5) business days following receipt of such written request.

5. Reservation of Rights

5.1 This Payoff Letter supersedes and replaces in their entirety any and all prior payoff quotations, payoff estimates, or other communications issued by Velthorn or any of its officers, employees, agents, or representatives with respect to the payoff of the Obligations.

5.2 Except as expressly set forth herein, nothing in this Payoff Letter shall constitute a waiver, modification, or amendment of any term or provision of the Credit Agreement or any other Loan Document, nor shall this Payoff Letter prejudice any right or remedy of Velthorn under the Credit Agreement or any other Loan Document that has not been expressly released or discharged hereby.

5.3 Upon receipt by Velthorn of the full Payoff Amount in immediately available funds in accordance with the terms of this Payoff Letter, all Obligations of CPI under the Credit Agreement, the Note, the Security Agreement, and the other Loan Documents shall be deemed fully satisfied, paid, and discharged in full, and the commitments and obligations of Velthorn to extend credit under the Credit Agreement shall be terminated.

5.4 Notwithstanding the foregoing, Velthorn expressly reserves all rights with respect to any surviving obligations of CPI that, by their express terms, survive the termination of the Credit Agreement and the repayment of the Obligations, including, without limitation, any indemnification obligations of CPI under Section 10.04 of the Credit Agreement and any obligations under Section 10.05 of the Credit Agreement relating to expense reimbursement, in each case solely to the extent such obligations have accrued and remain unpaid as of the date of receipt of the Payoff Amount. As of the date hereof, Velthorn is not aware of any pending or threatened claims for indemnification or expense reimbursement under the Credit Agreement, and Velthorn does not currently intend to assert any such claims; provided, however, that the foregoing statement shall not be deemed a waiver or release of any such surviving rights or obligations.

6. Reliance; Acknowledgment and Countersignature

This Payoff Letter is delivered for the benefit of, and may be relied upon by, the Borrower, the Buyer, and their respective counsel, advisors, and agents, including, without limitation, Calderwood & Harkness LLP, as counsel to the Buyer, and any title company or lender providing financing in connection with the Transaction.

Velthorn requests that CPI acknowledge and confirm the accuracy of the Payoff Amount set forth herein by executing this Payoff Letter in the space indicated below and returning a signed copy to the undersigned.

If you have any questions regarding this Payoff Letter or the payoff process, please do not hesitate to contact the undersigned at (617) 555-8247 or by electronic mail at margaret.chen@greylockmerchant.com.

Very truly yours,

VELTHORN MERCHANT BANK, N.A.

By: ________

Name: Margaret H. Chen

Title: Senior Vice President, Loan Administration

Date: June 26, 2024

Telephone: (617) 555-8247

Email: margaret.chen@greylockmerchant.com

ACKNOWLEDGMENT AND AGREEMENT

The undersigned hereby acknowledges receipt of this Payoff Letter and confirms the accuracy of the Payoff Amount and the other terms and conditions set forth herein. The undersigned Borrower agrees to pay, or cause to be paid, the Payoff Amount in accordance with the terms of this Payoff Letter.

CARDINAL PEAK INDUSTRIES, INC.

By: ________

Name: Dr. Randall J. Whitfield

Title: Chairman & Chief Executive Officer

Date: ________

Acknowledged (for informational purposes only, and without assuming any liability for the Obligations):

ARDENT HEALTHCARE ACQUISITION CORP.

By: ________

Name: Priya Mehta-Sullivan

Title: Authorized Signatory

Date: ________

PART B

CALDERWOOD & HARKNESS LLP

COVER MEMORANDUM AND UCC TERMINATION INSTRUCTIONS

CALDERWOOD & HARKNESS LLP Attorneys at Law

One World Financial Center 200 Liberty Street, 40th Floor New York, New York 10281

Telephone: (212) 555-4600 Facsimile: (212) 555-4601 www.calderwoodharkness.com

PRIVILEGED AND CONFIDENTIAL ATTORNEY-CLIENT PRIVILEGED / ATTORNEY WORK PRODUCT

June 28, 2024

MEMORANDUM

1. Background and Purpose

This memorandum summarizes the status of UCC-3 termination filings made by Calderwood & Harkness LLP on behalf of Velthorn Merchant Bank, N.A. ("Velthorn") in connection with the payoff and discharge of the existing senior secured indebtedness of Cardinal Peak Industries, Inc. ("CPI") under that certain Credit Agreement dated as of March 15, 2018, as amended (the "Credit Agreement"), between CPI and Velthorn.

On June 26, 2024, Velthorn issued a Payoff Letter (the "Payoff Letter") confirming the total indebtedness outstanding under the Credit Agreement and the aggregate amount required to satisfy and discharge all obligations of CPI thereunder. The Payoff Letter confirms the following:

• Outstanding principal balance: $87,400,000.00

• Accrued and unpaid interest through June 26, 2024: $287,543.06

• Per diem interest: $15,974.61 per day for each day after June 26, 2024

• Total payoff amount (good through June 30, 2024): $87,753,941.50

The payoff of the Velthorn indebtedness is to be made at the closing of the asset purchase transaction between CPI (as Seller) and Ardent Healthcare Acquisition Corp. ("Buyer" or "Ardent") on June 30, 2024 (the "Closing Date"), from closing funds as reflected in the Funds Flow Memorandum dated June 25, 2024, as revised on June 27, 2024 (the "Funds Flow Memo"). The payoff wire to Velthorn is item 3 on the Funds Flow Memo and will be initiated by the escrow agent simultaneously with, or immediately following, confirmation of the release of closing funds from the Buyer's acquisition financing provided by Pinnacle National Bank, N.A.

In Section 4(c) of the Payoff Letter, Velthorn expressly authorized Calderwood & Harkness LLP, as counsel to the Buyer, to file UCC-3 termination statements on Velthorn's behalf with respect to all UCC-1 financing statements that Velthorn has on file against CPI. This authorization becomes effective upon Velthorn's receipt of the full Payoff Amount, although the Payoff Letter permits the termination statements to be filed in advance of the payoff, with the understanding that the effectiveness of the termination of the underlying security interest is conditioned on actual receipt of the Payoff Amount.

The purpose of this memorandum is to document the UCC-3 termination filings made by Calderwood & Harkness LLP on June 28, 2024 — two (2) business days prior to the anticipated Closing Date — in order to ensure that the acquired assets will be free and clear of all Velthorn liens as of the Closing Date, thereby satisfying a condition precedent to closing under the APA and a condition to funding under Pinnacle National Bank's commitment letter.

2. UCC-1 Financing Statements on File

Based on UCC lien searches conducted by Penrose Software on June 10, 2024, and updated on June 24, 2024, the following UCC-1 financing statements are currently on file against CPI in favor of Velthorn:

The Delaware filing is the primary UCC-1 financing statement. CPI is organized under the laws of the State of Delaware, and accordingly the Delaware Secretary of State is the proper filing office for a UCC-1 financing statement covering all personal property assets of CPI under Article 9 of the Uniform Commercial Code (Del. Code Ann. tit. 6, § 9-301(1)). The Tennessee filing is a precautionary filing made given CPI's principal place of business in Nashville, Tennessee, and is intended to provide notice to third parties and to perfect Velthorn's security interest in any fixtures located in Tennessee to the extent such perfection requires a local filing under Tennessee law (Tenn. Code Ann. § 47-9-301 et seq.).

No amendments, continuations, or assignments of either UCC-1 financing statement were identified in the updated lien search results. Both filings remain active and have not been terminated.

3. UCC-3 Termination Statements Filed

On June 28, 2024, Calderwood & Harkness LLP filed UCC-3 termination statements with both the Delaware Secretary of State and the Tennessee Secretary of State, referencing and terminating each of the UCC-1 financing statements identified in Section 2 above. The following table summarizes the termination filings:

Both termination filings were submitted electronically through the respective Secretary of State's online filing systems. Confirmation receipts were received from each filing office within approximately two (2) hours of submission. The Delaware filing was processed and accepted at 10:17 a.m. EDT on June 28, 2024, and the Tennessee filing was processed and accepted at 11:42 a.m. CDT on June 28, 2024.

Copies of the filed UCC-3 termination statements and the electronic filing confirmation receipts from each Secretary of State's office are attached to this memorandum as follows:

• Exhibit A: UCC-3 Termination Statement and Filing Confirmation — Delaware Secretary of State (Filing No. 2024-3891047, dated June 28, 2024)

• Exhibit B: UCC-3 Termination Statement and Filing Confirmation — Tennessee Secretary of State (Filing No. 2024-015738, dated June 28, 2024)

4. Confirmation of Authorization

As noted above, Velthorn Merchant Bank, N.A. expressly authorized Calderwood & Harkness LLP to file UCC-3 termination statements on Velthorn's behalf in Section 4(c) of the Payoff Letter dated June 26, 2024. Specifically, the Payoff Letter provides:

"Velthorn hereby authorizes Calderwood & Harkness LLP, as counsel to the Buyer, to prepare, execute (to the extent permitted by applicable law), and file UCC-3 termination statements on Velthorn's behalf with respect to each of the UCC-1 financing statements identified in Section 4(b) above, in the event that Velthorn has not itself filed such UCC-3 termination statements within three (3) business days following Velthorn's receipt of the full Payoff Amount in immediately available funds."

Although the Payoff Letter's authorization language contemplates filing "in the event that Velthorn has not itself filed" within three business days, Velthorn's loan administration team (Margaret Chen, SVP) confirmed via telephone on June 27, 2024, and via email on June 28, 2024 at 9:03 a.m. EDT (copies of which are on file), that Velthorn has no objection to Calderwood & Harkness LLP filing the UCC-3 termination statements in advance of closing, consistent with standard payoff and lien release procedures for transactions of this nature. No additional authorization or filing by Velthorn is required to effectuate the termination of the UCC-1 financing statements.

Important Note Regarding Conditionality: While the UCC-3 termination statements are effective as filings upon their acceptance by the respective Secretaries of State — meaning that the public record will reflect the termination of the subject financing statements — the termination of the underlying security interest in the collateral remains conditioned on Velthorn's receipt of the full Payoff Amount in immediately available funds at closing on June 30, 2024. If closing does not occur, or if the Payoff Amount is not remitted to Velthorn on the Closing Date, Velthorn retains all rights under the Credit Agreement and the Security Agreement, and Velthorn would be entitled to file new UCC-1 financing statements or UCC-3 amendment statements to reinstate and/or continue its security interest in the collateral. The Payoff Letter contains an express reservation of rights to this effect, and all parties should be aware that the release of Velthorn's security interest is operative only upon satisfaction of the payoff condition.

5. Coordination with Closing

The following coordination steps have been taken or are in process in connection with the Velthorn payoff and lien releases:

(a) Funds Flow. The Payoff Amount of $87,753,941.50 (assuming closing on June 30, 2024) will be wired directly from the closing escrow account to Velthorn in accordance with the wire instructions set forth in Section 3 of the Payoff Letter and as reflected in line item 3 of the Funds Flow Memorandum. The wire is to be initiated by the escrow agent (Republic National Escrow Services, LLC) upon receipt of joint written release instructions from Buyer and Seller, and upon confirmation by Pinnacle National Bank, N.A. that the acquisition financing proceeds have been funded to the escrow account.

(b) Pinnacle National Bank Coordination. Pinnacle National Bank, N.A. ("Pinnacle"), in its capacity as Administrative Agent under the new senior secured credit facility being provided to Buyer in connection with the Transaction (the "New Credit Facility"), has been advised of the Velthorn payoff and the UCC termination filings. Clean title to the acquired assets — free and clear of all liens and encumbrances other than Permitted Liens (as defined in the New Credit Facility) — is a condition precedent to Pinnacle's obligation to fund the initial term loan and revolving credit advances under the New Credit Facility, as set forth in Section 5.01(h) of the Project Cardinal Commitment Letter dated April 2, 2024. Laura Fitzgibbons at Pinnacle has confirmed via email on June 27, 2024, that Pinnacle has reviewed and is satisfied with the Velthorn Payoff Letter and the plan for UCC termination filings, subject to receipt of filing confirmations, which are attached hereto.

(c) Title Company Coordination. Cornerstone Land Title Company ("Cornerstone"), which is providing the owner's title insurance policy and lender's title insurance policy in connection with any real property interests included in the acquired assets, has been provided copies of the UCC-3 termination filings and filing confirmations for purposes of confirming clear lien status on any real property-related fixtures that may be subject to the Velthorn security interest. Cornerstone has indicated that the filing confirmations are sufficient for purposes of issuing its title commitments without exception for the Velthorn UCC filings, provided that closing and payoff occur as contemplated.

6. Post-Closing Follow-Up

The following post-closing steps should be completed promptly following the Closing Date:

(a) Confirmation of Payoff Receipt. Following the remittance of the Payoff Amount on the Closing Date, confirm with Velthorn (Margaret Chen, SVP, Loan Administration) that the full Payoff Amount has been received in immediately available funds and that all Obligations of CPI under the Credit Agreement are deemed satisfied and discharged in full. Obtain written confirmation from Velthorn of receipt, including the date and time of receipt and the amount received.

(b) Written Release/Discharge Letter. Request from Velthorn a formal written release and discharge letter (a "Discharge Letter") confirming that: (i) all Obligations under the Credit Agreement have been fully satisfied and discharged; (ii) all liens, security interests, and encumbrances held by Velthorn on the assets of CPI have been released; and (iii) the Credit Agreement, Security Agreement, Note, and all other Loan Documents have been terminated. This Discharge Letter should be requested promptly following closing and should be obtained within ten (10) business days of the Closing Date.

(c) Additional Lien Release Documentation. Monitor for any additional lien release instruments or termination documents that may be required in connection with the release of Velthorn's security interest, including, without limitation:

(i) Termination or release of any deposit account control agreements ("DACAs") that may have been entered into between CPI, Velthorn, and any depository bank in connection with Velthorn's perfection of its security interest in CPI's deposit accounts;

(ii) Release or reassignment of any intellectual property security agreements or assignments that may have been filed with the United States Patent and Trademark Office or the United States Copyright Office in connection with Velthorn's security interest in CPI's intellectual property;

(iii) Release of any mortgage, deed of trust, or fixture filing that may have been recorded in any county or municipal recording office in connection with Velthorn's security interest in fixtures or real property-related collateral; and

(iv) Any other instruments, filings, or documentation reasonably necessary to evidence and confirm the full release and termination of Velthorn's security interest in the collateral.

Coordinate with Velthorn for the prompt execution, delivery, and filing (as applicable) of all such additional release documentation. Under Section 4(d) of the Payoff Letter, Velthorn has agreed to use commercially reasonable efforts to deliver such additional documentation within five (5) business days following receipt of a written request.

(d) Closing Binder. File all payoff-related documentation, including the Payoff Letter, UCC-3 termination statements and filing confirmations, the Discharge Letter (when received), and all other lien release documentation, in the closing binder under the appropriate section (Section VII — Lien Releases and Payoff Documentation, per the Closing Binder Index).

7. Attachments / Exhibits

The following exhibits are attached to this memorandum and incorporated herein by reference:

Exhibit A: Copy of UCC-3 Termination Statement filed with the Delaware Secretary of State — Filing Confirmation dated June 28, 2024 (Filing No. 2024-3891047, terminating original UCC-1 Filing No. 2018-1547832)

Exhibit B: Copy of UCC-3 Termination Statement filed with the Tennessee Secretary of State — Filing Confirmation dated June 28, 2024 (Filing No. 2024-015738, terminating original UCC-1 Filing No. 2018-007294)

Exhibit C: Payoff Letter from Velthorn Merchant Bank, N.A. dated June 26, 2024 (copy attached for reference)

Please direct any questions regarding this memorandum or the UCC termination filings to Derek Okonkwo at (212) 555-4637 or dokonkwo@calderwoodharkness.com.

CALDERWOOD & HARKNESS LLP

Derek Okonkwo Associate Corporate / M&A Group Telephone: (212) 555-4637

Email: dokonkwo@calderwoodharkness.com

This memorandum is a privileged and confidential attorney-client communication and attorney work product prepared in connection with the representation of Ardent Healthcare Acquisition Corp. in the Project Cardinal transaction. This memorandum is not intended to be, and should not be construed as, legal advice to any person or entity other than the named recipients. Any unauthorized review, use, disclosure, or distribution of this memorandum is strictly prohibited.

Component	Amount
Outstanding Principal Balance	$87,400,000.00
Accrued and Unpaid Interest through June 26, 2024	$287,543.06
Per Diem Interest for June 27–30, 2024 (4 days × $15,974.61)	$63,898.44
Administrative and Processing Fee	$2,500.00
Total Payoff Amount (Good Through June 30, 2024)	$87,753,941.50
Beneficiary Bank:	Velthorn Merchant Bank, N.A.
ABA Routing Number:	021-307-481
Account Name:	Cardinal Peak Industries, Inc. — Loan Payoff Account
Account Number:	8840-2917-3356
Reference:	Credit Agreement dated March 15, 2018 — Full Payoff
TO:	Beatrice Holloway, Derek Okonkwo, Tiffany Rosenthal (Calderwood & Harkness LLP — Project Cardinal Deal Team)
CC:	Priya Mehta-Sullivan, Connor Briggs (Ardent Capital Management LLC); Laura Fitzgibbons (Pinnacle National Bank, N.A.)
FROM:	Derek Okonkwo
DATE:	June 28, 2024
RE:	UCC Termination Filings — Velthorn Merchant Bank, N.A. Liens on Cardinal Peak Industries, Inc.
Filing Jurisdiction	Filing Office	Original Filing Date	Filing Number	Debtor	Secured Party	Collateral Description
Delaware	Delaware Secretary of State, Division of Corporations	March 15, 2018	2018-1547832	Cardinal Peak Industries, Inc.	Velthorn Merchant Bank, N.A.	All assets of Debtor, whether now owned or hereafter acquired, including without limitation all accounts, accounts receivable, chattel paper, deposit accounts, documents, equipment, fixtures, general intangibles (including payment intangibles and software), goods, instruments, intellectual property, inventory, investment property, letter-of-credit rights, supporting obligations, commercial tort claims, and all proceeds and products thereof.
Tennessee	Tennessee Secretary of State, Division of Business Services	March 15, 2018	2018-007294	Cardinal Peak Industries, Inc.	Velthorn Merchant Bank, N.A.	All assets of Debtor, whether now owned or hereafter acquired, including without limitation all accounts, accounts receivable, chattel paper, deposit accounts, documents, equipment, fixtures, general intangibles, goods, instruments, intellectual property, inventory, investment property, and all proceeds and products thereof.
Filing Jurisdiction	Filing Office	Date Filed	Termination Filing Number	Original UCC-1 Filing Number Terminated	Status
Delaware	Delaware Secretary of State, Division of Corporations	June 28, 2024	2024-3891047	2018-1547832	Filed / Accepted
Tennessee	Tennessee Secretary of State, Division of Business Services	June 28, 2024	2024-015738	2018-007294	Filed / Accepted

PART A
PAYOFF LETTER
VELTHORN MERCHANT BANK, N.A.
VELTHORN MERCHANT BANK, N.A. 120 Federal Street, 22nd Floor Boston, Massachusetts 02110
Telephone: (617) 555-8200 Facsimile: (617) 555-8201
A nationally chartered banking association organized under the laws of the Commonwealth of Massachusetts
June 26, 2024
VIA ELECTRONIC MAIL AND OVERNIGHT COURIER
Cardinal Peak Industries, Inc. 8400 Crescent Ridge Parkway, Suite 200 Nashville, Tennessee 37215
Attention: Dr. Randall J. Whitfield, Chairman & Chief Executive Officer
Ardent Healthcare Acquisition Corp. c/o National Registered Services, Inc. 1209 Orange Street Wilmington, Delaware 19801
with a copy to:
Ardent Capital Management LLC 590 Madison Avenue, 34th Floor New York, New York 10022
Attention: Priya Mehta-Sullivan
Calderwood & Harkness LLP One World Financial Center 200 Liberty Street, 40th Floor New York, New York 10281
Attention: Beatrice Holloway, Esq. / Derek Okonkwo, Esq.
Re: Payoff of Indebtedness under that certain Credit Agreement dated as of March 15, 2018, as amended by that certain First Amendment to Credit Agreement dated as of September 12, 2019, and that certain Second Amendment to Credit Agreement dated as of January 7, 2021 (as so amended, and as may have been further modified, supplemented, or restated from time to time, the "Credit Agreement"), by and among Cardinal Peak Industries, Inc., a Delaware corporation (the "Borrower" or "CPI"), and Velthorn Merchant Bank, N.A., a national banking association (in its capacities as "Lender" and "Agent")
Ladies and Gentlemen:
1. Reference to Credit Agreement and Existing Indebtedness
Reference is hereby made to the Credit Agreement dated as of March 15, 2018 (as defined above), by and among Cardinal Peak Industries, Inc., as Borrower, and Velthorn Merchant Bank, N.A. ("Velthorn"), as Lender and Administrative Agent. Pursuant to the Credit Agreement, Velthorn extended to CPI a senior secured term loan facility in an original aggregate principal amount of One Hundred Million Dollars ($100,000,000.00) (the "Term Loan"). The Term Loan is secured by substantially all of the assets of CPI, as more particularly described in the Security Agreement dated as of March 15, 2018, between CPI and Velthorn (the "Security Agreement"), and is further evidenced by that certain Promissory Note dated March 15, 2018, in the original principal amount of $100,000,000.00 (the "Note"). Capitalized terms used but not defined herein shall have the meanings ascribed to them in the Credit Agreement.
CPI has advised Velthorn that CPI has entered into that certain Asset Purchase Agreement dated as of April 2, 2024 (the "APA"), by and between Cardinal Peak Industries, Inc., as Seller, and Ardent Healthcare Acquisition Corp., a Delaware corporation ("Buyer" or "Ardent"), pursuant to which Buyer will acquire substantially all of the assets of CPI. In connection with the proposed closing of the transactions contemplated by the APA (the "Transaction"), CPI has requested that Velthorn issue this payoff letter (this "Payoff Letter") setting forth the aggregate amount required to satisfy and discharge in full all outstanding obligations of CPI under the Credit Agreement, the Note, the Security Agreement, and all other Loan Documents (as defined in the Credit Agreement) (collectively, the "Obligations").
This Payoff Letter is being delivered at the request of CPI and for the benefit of CPI, Buyer, and their respective counsel in connection with the closing of the Transaction.
2. Payoff Amount
Based upon Velthorn's records as of the close of business on June 26, 2024, the aggregate amount necessary to satisfy and discharge in full all Obligations of CPI under the Credit Agreement (the "Payoff Amount") is as follows:
2.1 Outstanding Principal Balance
The outstanding principal balance of the Term Loan as of June 26, 2024, is:
$87,400,000.00
2.2 Accrued and Unpaid Interest
Accrued and unpaid interest on the outstanding principal balance through and including June 26, 2024, calculated in accordance with the interest rate provisions of the Credit Agreement (Term SOFR plus the Applicable Margin of 2.50%, as set forth in the Second Amendment), is:
$287,543.06
2.3 Per Diem Interest
Interest continues to accrue on the outstanding principal balance at a rate of $15,974.61 per day (the "Per Diem Amount"), calculated on the basis of a 360-day year and actual days elapsed, in accordance with Section 2.08 of the Credit Agreement. The Per Diem Amount shall be applied for each day after June 26, 2024, through and including the date on which the Payoff Amount is received in full in immediately available funds by Velthorn.
2.4 Prepayment Premium
The Credit Agreement, as amended by the Second Amendment dated January 7, 2021, provides that no prepayment premium, yield maintenance charge, make-whole amount, or other similar fee or penalty shall be payable by CPI in connection with any prepayment or repayment of the Term Loan occurring on or after the fifth (5th) anniversary of the Closing Date (as defined in the Credit Agreement). The Closing Date under the Credit Agreement was March 15, 2018, and accordingly the fifth anniversary thereof was March 15, 2023. As the repayment contemplated hereby will occur after such date, no prepayment premium is due or owing in connection with this payoff.
2.5 Administrative and Processing Fee
Velthorn's standard administrative and processing fee for payoff, discharge, and release of all lien-related documentation is:
$2,500.00
2.6 Total Payoff Amount — Assuming Receipt on June 30, 2024
Assuming that the Payoff Amount is received in full by Velthorn in immediately available funds on or before June 30, 2024, the total amount required to satisfy and discharge in full all Obligations is calculated as follows:
2.7 Good-Through Date and Adjustments
The Payoff Amount set forth above is valid only if received in full in immediately available funds on or before June 30, 2024 (the "Good-Through Date"). If the Payoff Amount is not received on or before the Good-Through Date, the Per Diem Amount of $15,974.61 per day shall be added to the Total Payoff Amount for each calendar day after June 30, 2024, through and including the actual date of receipt of the full Payoff Amount in immediately available funds. In such event, the payor should contact the undersigned at the telephone number set forth below to obtain an updated payoff figure prior to remitting funds.
This Payoff Letter supersedes and replaces any prior payoff quotations, payoff estimates, or other payoff communications that may have been issued by Velthorn or its representatives in connection with the Obligations.
3. Wire Transfer Instructions
The Payoff Amount must be remitted by federal funds wire transfer in immediately available, same-day federal funds to the following account:
IMPORTANT: Funds must be received in immediately available, same-day federal funds. Cashier's checks, certified checks, or other forms of payment are not acceptable and will not be deemed to constitute payment of the Payoff Amount for purposes of this Payoff Letter. Velthorn shall have no obligation to release any liens, security interests, or encumbrances unless and until the full Payoff Amount has been received by Velthorn in the form specified herein.
The payor shall notify the undersigned by telephone at (617) 555-8247 and by electronic mail at loan.payoffs@greylockmerchant.com promptly upon initiation of the wire transfer, providing the wire confirmation number and the amount remitted.
4. Release of Liens and UCC Termination Statements
Velthorn Merchant Bank, N.A. hereby confirms that, upon receipt and final clearance of the full Payoff Amount in immediately available funds in accordance with the terms of this Payoff Letter:
(a) Release of All Liens and Security Interests. Velthorn shall release, and hereby agrees to release, all liens, security interests, mortgages, pledges, assignments, and encumbrances of every kind and description held by Velthorn on any and all assets, properties, and rights of Cardinal Peak Industries, Inc. (whether now owned or hereafter acquired) that were granted to Velthorn or in which Velthorn holds or claims any interest as security for the Obligations under the Credit Agreement, the Security Agreement, or any other Loan Document, including, without limitation, all personal property, fixtures, accounts, accounts receivable, inventory, equipment, general intangibles, intellectual property, instruments, chattel paper, investment property, deposit accounts, letter-of-credit rights, commercial tort claims, and proceeds thereof.
(b) UCC-3 Termination Statements. Velthorn shall promptly authorize and/or file, or cause to be filed, UCC-3 termination statements with respect to all UCC-1 financing statements that have been filed by or on behalf of Velthorn against CPI, including, without limitation, the following:
(i) UCC-1 Financing Statement filed with the Delaware Secretary of State on March 15, 2018, File Number 2018-1547832, naming Cardinal Peak Industries, Inc. as Debtor and Velthorn Merchant Bank, N.A. as Secured Party, covering all assets of the Debtor; and
(ii) UCC-1 Financing Statement filed with the Tennessee Secretary of State on March 15, 2018, File Number 2018-007294, naming Cardinal Peak Industries, Inc. as Debtor and Velthorn Merchant Bank, N.A. as Secured Party, covering all assets of the Debtor (precautionary filing).
(c) Authorization to File on Velthorn's Behalf. Velthorn hereby authorizes Calderwood & Harkness LLP, as counsel to the Buyer, to prepare, execute (to the extent permitted by applicable law), and file UCC-3 termination statements on Velthorn's behalf with respect to each of the UCC-1 financing statements identified in Section 4(b) above, in the event that Velthorn has not itself filed such UCC-3 termination statements within three (3) business days following Velthorn's receipt of the full Payoff Amount in immediately available funds. This authorization shall be deemed to be Velthorn's written authorization for purposes of Section 9-509(d)(2) of the Uniform Commercial Code as adopted in the State of Delaware and the State of Tennessee, and any other applicable jurisdiction. Such authorization shall become effective upon Velthorn's receipt of the full Payoff Amount and shall be irrevocable thereafter.
(d) Additional Release Documentation. Velthorn shall, promptly upon written request from CPI, Buyer, or Buyer's counsel, execute and deliver any and all additional lien release documents, mortgage releases, satisfactions, termination instruments, releases of deposit account control agreements, and other instruments or filings reasonably necessary or desirable to evidence and confirm the release of all liens and security interests held by Velthorn on the assets of CPI and to clear any public records of any record of any such lien or security interest. Velthorn agrees to use commercially reasonable efforts to deliver any such additional documentation within five (5) business days following receipt of such written request.
5. Reservation of Rights
5.1 This Payoff Letter supersedes and replaces in their entirety any and all prior payoff quotations, payoff estimates, or other communications issued by Velthorn or any of its officers, employees, agents, or representatives with respect to the payoff of the Obligations.
5.2 Except as expressly set forth herein, nothing in this Payoff Letter shall constitute a waiver, modification, or amendment of any term or provision of the Credit Agreement or any other Loan Document, nor shall this Payoff Letter prejudice any right or remedy of Velthorn under the Credit Agreement or any other Loan Document that has not been expressly released or discharged hereby.
5.3 Upon receipt by Velthorn of the full Payoff Amount in immediately available funds in accordance with the terms of this Payoff Letter, all Obligations of CPI under the Credit Agreement, the Note, the Security Agreement, and the other Loan Documents shall be deemed fully satisfied, paid, and discharged in full, and the commitments and obligations of Velthorn to extend credit under the Credit Agreement shall be terminated.
5.4 Notwithstanding the foregoing, Velthorn expressly reserves all rights with respect to any surviving obligations of CPI that, by their express terms, survive the termination of the Credit Agreement and the repayment of the Obligations, including, without limitation, any indemnification obligations of CPI under Section 10.04 of the Credit Agreement and any obligations under Section 10.05 of the Credit Agreement relating to expense reimbursement, in each case solely to the extent such obligations have accrued and remain unpaid as of the date of receipt of the Payoff Amount. As of the date hereof, Velthorn is not aware of any pending or threatened claims for indemnification or expense reimbursement under the Credit Agreement, and Velthorn does not currently intend to assert any such claims; provided, however, that the foregoing statement shall not be deemed a waiver or release of any such surviving rights or obligations.
6. Reliance; Acknowledgment and Countersignature
This Payoff Letter is delivered for the benefit of, and may be relied upon by, the Borrower, the Buyer, and their respective counsel, advisors, and agents, including, without limitation, Calderwood & Harkness LLP, as counsel to the Buyer, and any title company or lender providing financing in connection with the Transaction.
Velthorn requests that CPI acknowledge and confirm the accuracy of the Payoff Amount set forth herein by executing this Payoff Letter in the space indicated below and returning a signed copy to the undersigned.
If you have any questions regarding this Payoff Letter or the payoff process, please do not hesitate to contact the undersigned at (617) 555-8247 or by electronic mail at margaret.chen@greylockmerchant.com.
Very truly yours,
VELTHORN MERCHANT BANK, N.A.
By: ________
Name: Margaret H. Chen
Title: Senior Vice President, Loan Administration
Date: June 26, 2024
Telephone: (617) 555-8247
Email: margaret.chen@greylockmerchant.com
ACKNOWLEDGMENT AND AGREEMENT
The undersigned hereby acknowledges receipt of this Payoff Letter and confirms the accuracy of the Payoff Amount and the other terms and conditions set forth herein. The undersigned Borrower agrees to pay, or cause to be paid, the Payoff Amount in accordance with the terms of this Payoff Letter.
CARDINAL PEAK INDUSTRIES, INC.
By: ________
Name: Dr. Randall J. Whitfield
Title: Chairman & Chief Executive Officer
Date: ________
Acknowledged (for informational purposes only, and without assuming any liability for the Obligations):
ARDENT HEALTHCARE ACQUISITION CORP.
By: ________
Name: Priya Mehta-Sullivan
Title: Authorized Signatory
Date: ________
PART B
CALDERWOOD & HARKNESS LLP
COVER MEMORANDUM AND UCC TERMINATION INSTRUCTIONS
CALDERWOOD & HARKNESS LLP Attorneys at Law
One World Financial Center 200 Liberty Street, 40th Floor New York, New York 10281
Telephone: (212) 555-4600 Facsimile: (212) 555-4601 www.calderwoodharkness.com
PRIVILEGED AND CONFIDENTIAL ATTORNEY-CLIENT PRIVILEGED / ATTORNEY WORK PRODUCT
June 28, 2024
MEMORANDUM
1. Background and Purpose
This memorandum summarizes the status of UCC-3 termination filings made by Calderwood & Harkness LLP on behalf of Velthorn Merchant Bank, N.A. ("Velthorn") in connection with the payoff and discharge of the existing senior secured indebtedness of Cardinal Peak Industries, Inc. ("CPI") under that certain Credit Agreement dated as of March 15, 2018, as amended (the "Credit Agreement"), between CPI and Velthorn.
On June 26, 2024, Velthorn issued a Payoff Letter (the "Payoff Letter") confirming the total indebtedness outstanding under the Credit Agreement and the aggregate amount required to satisfy and discharge all obligations of CPI thereunder. The Payoff Letter confirms the following:
•  Outstanding principal balance: $87,400,000.00
•  Accrued and unpaid interest through June 26, 2024: $287,543.06
•  Per diem interest: $15,974.61 per day for each day after June 26, 2024
•  Total payoff amount (good through June 30, 2024): $87,753,941.50
The payoff of the Velthorn indebtedness is to be made at the closing of the asset purchase transaction between CPI (as Seller) and Ardent Healthcare Acquisition Corp. ("Buyer" or "Ardent") on June 30, 2024 (the "Closing Date"), from closing funds as reflected in the Funds Flow Memorandum dated June 25, 2024, as revised on June 27, 2024 (the "Funds Flow Memo"). The payoff wire to Velthorn is item 3 on the Funds Flow Memo and will be initiated by the escrow agent simultaneously with, or immediately following, confirmation of the release of closing funds from the Buyer's acquisition financing provided by Pinnacle National Bank, N.A.
In Section 4(c) of the Payoff Letter, Velthorn expressly authorized Calderwood & Harkness LLP, as counsel to the Buyer, to file UCC-3 termination statements on Velthorn's behalf with respect to all UCC-1 financing statements that Velthorn has on file against CPI. This authorization becomes effective upon Velthorn's receipt of the full Payoff Amount, although the Payoff Letter permits the termination statements to be filed in advance of the payoff, with the understanding that the effectiveness of the termination of the underlying security interest is conditioned on actual receipt of the Payoff Amount.
The purpose of this memorandum is to document the UCC-3 termination filings made by Calderwood & Harkness LLP on June 28, 2024 — two (2) business days prior to the anticipated Closing Date — in order to ensure that the acquired assets will be free and clear of all Velthorn liens as of the Closing Date, thereby satisfying a condition precedent to closing under the APA and a condition to funding under Pinnacle National Bank's commitment letter.
2. UCC-1 Financing Statements on File
Based on UCC lien searches conducted by Penrose Software on June 10, 2024, and updated on June 24, 2024, the following UCC-1 financing statements are currently on file against CPI in favor of Velthorn:
The Delaware filing is the primary UCC-1 financing statement. CPI is organized under the laws of the State of Delaware, and accordingly the Delaware Secretary of State is the proper filing office for a UCC-1 financing statement covering all personal property assets of CPI under Article 9 of the Uniform Commercial Code (Del. Code Ann. tit. 6, § 9-301(1)). The Tennessee filing is a precautionary filing made given CPI's principal place of business in Nashville, Tennessee, and is intended to provide notice to third parties and to perfect Velthorn's security interest in any fixtures located in Tennessee to the extent such perfection requires a local filing under Tennessee law (Tenn. Code Ann. § 47-9-301 et seq.).
No amendments, continuations, or assignments of either UCC-1 financing statement were identified in the updated lien search results. Both filings remain active and have not been terminated.
3. UCC-3 Termination Statements Filed
On June 28, 2024, Calderwood & Harkness LLP filed UCC-3 termination statements with both the Delaware Secretary of State and the Tennessee Secretary of State, referencing and terminating each of the UCC-1 financing statements identified in Section 2 above. The following table summarizes the termination filings:
Both termination filings were submitted electronically through the respective Secretary of State's online filing systems. Confirmation receipts were received from each filing office within approximately two (2) hours of submission. The Delaware filing was processed and accepted at 10:17 a.m. EDT on June 28, 2024, and the Tennessee filing was processed and accepted at 11:42 a.m. CDT on June 28, 2024.
Copies of the filed UCC-3 termination statements and the electronic filing confirmation receipts from each Secretary of State's office are attached to this memorandum as follows:
•  Exhibit A: UCC-3 Termination Statement and Filing Confirmation — Delaware Secretary of State (Filing No. 2024-3891047, dated June 28, 2024)
•  Exhibit B: UCC-3 Termination Statement and Filing Confirmation — Tennessee Secretary of State (Filing No. 2024-015738, dated June 28, 2024)
4. Confirmation of Authorization
As noted above, Velthorn Merchant Bank, N.A. expressly authorized Calderwood & Harkness LLP to file UCC-3 termination statements on Velthorn's behalf in Section 4(c) of the Payoff Letter dated June 26, 2024. Specifically, the Payoff Letter provides:
"Velthorn hereby authorizes Calderwood & Harkness LLP, as counsel to the Buyer, to prepare, execute (to the extent permitted by applicable law), and file UCC-3 termination statements on Velthorn's behalf with respect to each of the UCC-1 financing statements identified in Section 4(b) above, in the event that Velthorn has not itself filed such UCC-3 termination statements within three (3) business days following Velthorn's receipt of the full Payoff Amount in immediately available funds."
Although the Payoff Letter's authorization language contemplates filing "in the event that Velthorn has not itself filed" within three business days, Velthorn's loan administration team (Margaret Chen, SVP) confirmed via telephone on June 27, 2024, and via email on June 28, 2024 at 9:03 a.m. EDT (copies of which are on file), that Velthorn has no objection to Calderwood & Harkness LLP filing the UCC-3 termination statements in advance of closing, consistent with standard payoff and lien release procedures for transactions of this nature. No additional authorization or filing by Velthorn is required to effectuate the termination of the UCC-1 financing statements.
Important Note Regarding Conditionality: While the UCC-3 termination statements are effective as filings upon their acceptance by the respective Secretaries of State — meaning that the public record will reflect the termination of the subject financing statements — the termination of the underlying security interest in the collateral remains conditioned on Velthorn's receipt of the full Payoff Amount in immediately available funds at closing on June 30, 2024. If closing does not occur, or if the Payoff Amount is not remitted to Velthorn on the Closing Date, Velthorn retains all rights under the Credit Agreement and the Security Agreement, and Velthorn would be entitled to file new UCC-1 financing statements or UCC-3 amendment statements to reinstate and/or continue its security interest in the collateral. The Payoff Letter contains an express reservation of rights to this effect, and all parties should be aware that the release of Velthorn's security interest is operative only upon satisfaction of the payoff condition.
5. Coordination with Closing
The following coordination steps have been taken or are in process in connection with the Velthorn payoff and lien releases:
(a) Funds Flow. The Payoff Amount of $87,753,941.50 (assuming closing on June 30, 2024) will be wired directly from the closing escrow account to Velthorn in accordance with the wire instructions set forth in Section 3 of the Payoff Letter and as reflected in line item 3 of the Funds Flow Memorandum. The wire is to be initiated by the escrow agent (Republic National Escrow Services, LLC) upon receipt of joint written release instructions from Buyer and Seller, and upon confirmation by Pinnacle National Bank, N.A. that the acquisition financing proceeds have been funded to the escrow account.
(b) Pinnacle National Bank Coordination. Pinnacle National Bank, N.A. ("Pinnacle"), in its capacity as Administrative Agent under the new senior secured credit facility being provided to Buyer in connection with the Transaction (the "New Credit Facility"), has been advised of the Velthorn payoff and the UCC termination filings. Clean title to the acquired assets — free and clear of all liens and encumbrances other than Permitted Liens (as defined in the New Credit Facility) — is a condition precedent to Pinnacle's obligation to fund the initial term loan and revolving credit advances under the New Credit Facility, as set forth in Section 5.01(h) of the Project Cardinal Commitment Letter dated April 2, 2024. Laura Fitzgibbons at Pinnacle has confirmed via email on June 27, 2024, that Pinnacle has reviewed and is satisfied with the Velthorn Payoff Letter and the plan for UCC termination filings, subject to receipt of filing confirmations, which are attached hereto.
(c) Title Company Coordination. Cornerstone Land Title Company ("Cornerstone"), which is providing the owner's title insurance policy and lender's title insurance policy in connection with any real property interests included in the acquired assets, has been provided copies of the UCC-3 termination filings and filing confirmations for purposes of confirming clear lien status on any real property-related fixtures that may be subject to the Velthorn security interest. Cornerstone has indicated that the filing confirmations are sufficient for purposes of issuing its title commitments without exception for the Velthorn UCC filings, provided that closing and payoff occur as contemplated.
6. Post-Closing Follow-Up
The following post-closing steps should be completed promptly following the Closing Date:
(a) Confirmation of Payoff Receipt. Following the remittance of the Payoff Amount on the Closing Date, confirm with Velthorn (Margaret Chen, SVP, Loan Administration) that the full Payoff Amount has been received in immediately available funds and that all Obligations of CPI under the Credit Agreement are deemed satisfied and discharged in full. Obtain written confirmation from Velthorn of receipt, including the date and time of receipt and the amount received.
(b) Written Release/Discharge Letter. Request from Velthorn a formal written release and discharge letter (a "Discharge Letter") confirming that: (i) all Obligations under the Credit Agreement have been fully satisfied and discharged; (ii) all liens, security interests, and encumbrances held by Velthorn on the assets of CPI have been released; and (iii) the Credit Agreement, Security Agreement, Note, and all other Loan Documents have been terminated. This Discharge Letter should be requested promptly following closing and should be obtained within ten (10) business days of the Closing Date.
(c) Additional Lien Release Documentation. Monitor for any additional lien release instruments or termination documents that may be required in connection with the release of Velthorn's security interest, including, without limitation:
(i) Termination or release of any deposit account control agreements ("DACAs") that may have been entered into between CPI, Velthorn, and any depository bank in connection with Velthorn's perfection of its security interest in CPI's deposit accounts;
(ii) Release or reassignment of any intellectual property security agreements or assignments that may have been filed with the United States Patent and Trademark Office or the United States Copyright Office in connection with Velthorn's security interest in CPI's intellectual property;
(iii) Release of any mortgage, deed of trust, or fixture filing that may have been recorded in any county or municipal recording office in connection with Velthorn's security interest in fixtures or real property-related collateral; and
(iv) Any other instruments, filings, or documentation reasonably necessary to evidence and confirm the full release and termination of Velthorn's security interest in the collateral.
Coordinate with Velthorn for the prompt execution, delivery, and filing (as applicable) of all such additional release documentation. Under Section 4(d) of the Payoff Letter, Velthorn has agreed to use commercially reasonable efforts to deliver such additional documentation within five (5) business days following receipt of a written request.
(d) Closing Binder. File all payoff-related documentation, including the Payoff Letter, UCC-3 termination statements and filing confirmations, the Discharge Letter (when received), and all other lien release documentation, in the closing binder under the appropriate section (Section VII — Lien Releases and Payoff Documentation, per the Closing Binder Index).
7. Attachments / Exhibits
The following exhibits are attached to this memorandum and incorporated herein by reference:
Exhibit A: Copy of UCC-3 Termination Statement filed with the Delaware Secretary of State — Filing Confirmation dated June 28, 2024 (Filing No. 2024-3891047, terminating original UCC-1 Filing No. 2018-1547832)
Exhibit B: Copy of UCC-3 Termination Statement filed with the Tennessee Secretary of State — Filing Confirmation dated June 28, 2024 (Filing No. 2024-015738, terminating original UCC-1 Filing No. 2018-007294)
Exhibit C: Payoff Letter from Velthorn Merchant Bank, N.A. dated June 26, 2024 (copy attached for reference)
Please direct any questions regarding this memorandum or the UCC termination filings to Derek Okonkwo at (212) 555-4637 or dokonkwo@calderwoodharkness.com.
CALDERWOOD & HARKNESS LLP
Derek Okonkwo Associate Corporate / M&A Group Telephone: (212) 555-4637
Email: dokonkwo@calderwoodharkness.com
This memorandum is a privileged and confidential attorney-client communication and attorney work product prepared in connection with the representation of Ardent Healthcare Acquisition Corp. in the Project Cardinal transaction. This memorandum is not intended to be, and should not be construed as, legal advice to any person or entity other than the named recipients. Any unauthorized review, use, disclosure, or distribution of this memorandum is strictly prohibited.
Component | Amount
Outstanding Principal Balance | $87,400,000.00
Accrued and Unpaid Interest through June 26, 2024 | $287,543.06
Per Diem Interest for June 27–30, 2024 (4 days × $15,974.61) | $63,898.44
Administrative and Processing Fee | $2,500.00
Total Payoff Amount (Good Through June 30, 2024) | $87,753,941.50
Beneficiary Bank: | Velthorn Merchant Bank, N.A.
ABA Routing Number: | 021-307-481
Account Name: | Cardinal Peak Industries, Inc. — Loan Payoff Account
Account Number: | 8840-2917-3356
Reference: | Credit Agreement dated March 15, 2018 — Full Payoff
TO: | Beatrice Holloway, Derek Okonkwo, Tiffany Rosenthal (Calderwood & Harkness LLP — Project Cardinal Deal Team)
CC: | Priya Mehta-Sullivan, Connor Briggs (Ardent Capital Management LLC); Laura Fitzgibbons (Pinnacle National Bank, N.A.)
FROM: | Derek Okonkwo
DATE: | June 28, 2024
RE: | UCC Termination Filings — Velthorn Merchant Bank, N.A. Liens on Cardinal Peak Industries, Inc.
Filing Jurisdiction | Filing Office | Original Filing Date | Filing Number | Debtor | Secured Party | Collateral Description
Delaware | Delaware Secretary of State, Division of Corporations | March 15, 2018 | 2018-1547832 | Cardinal Peak Industries, Inc. | Velthorn Merchant Bank, N.A. | All assets of Debtor, whether now owned or hereafter acquired, including without limitation all accounts, accounts receivable, chattel paper, deposit accounts, documents, equipment, fixtures, general intangibles (including payment intangibles and software), goods, instruments, intellectual property, inventory, investment property, letter-of-credit rights, supporting obligations, commercial tort claims, and all proceeds and products thereof.
Tennessee | Tennessee Secretary of State, Division of Business Services | March 15, 2018 | 2018-007294 | Cardinal Peak Industries, Inc. | Velthorn Merchant Bank, N.A. | All assets of Debtor, whether now owned or hereafter acquired, including without limitation all accounts, accounts receivable, chattel paper, deposit accounts, documents, equipment, fixtures, general intangibles, goods, instruments, intellectual property, inventory, investment property, and all proceeds and products thereof.
Filing Jurisdiction | Filing Office | Date Filed | Termination Filing Number | Original UCC-1 Filing Number Terminated | Status
Delaware | Delaware Secretary of State, Division of Corporations | June 28, 2024 | 2024-3891047 | 2018-1547832 | Filed / Accepted
Tennessee | Tennessee Secretary of State, Division of Business Services | June 28, 2024 | 2024-015738 | 2018-007294 | Filed / Accepted

PART A

PAYOFF LETTER

VELTHORN MERCHANT BANK, N.A.

VIA ELECTRONIC MAIL AND OVERNIGHT COURIER

VELTHORN MERCHANT BANK, N.A.

ACKNOWLEDGMENT AND AGREEMENT

CARDINAL PEAK INDUSTRIES, INC.

ARDENT HEALTHCARE ACQUISITION CORP.

CALDERWOOD & HARKNESS LLP

COVER MEMORANDUM AND UCC TERMINATION INSTRUCTIONS

PRIVILEGED AND CONFIDENTIAL ATTORNEY-CLIENT PRIVILEGED / ATTORNEY WORK PRODUCT

MEMORANDUM

CALDERWOOD & HARKNESS LLP

Record

Parties

Dates

Amounts