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PRIVILEGED & CONFIDENTIAL ATTORNEY-CLIENT COMMUNICATION

CALDERWOOD & HARKNESS LLP One World Financial Center 200 Liberty Street, 40th Floor New York, NY 10281

Telephone: (212) 555-7800 Facsimile: (212) 555-7801 www.calderwoodharkness.com

July 3, 2024

Matter No.: 2024-M&A-0142

VIA ELECTRONIC MAIL AND HAND DELIVERY

Marcus Ainsworth, Esq. Managing Partner & Co-Founder Ardent Capital Management LLC 590 Madison Avenue, 34th Floor New York, NY 10022

Priya Mehta-Sullivan Partner, Head of Healthcare Investments Ardent Capital Management LLC 590 Madison Avenue, 34th Floor New York, NY 10022

Re: Completion of Acquisition of Substantially All Assets of Cardinal Peak Industries, Inc. by Ardent Healthcare Acquisition Corp. — Post-Closing Summary and Outstanding Obligations

Dear Marcus and Priya:

We are pleased to provide this comprehensive post-closing summary letter in connection with the acquisition by Ardent Healthcare Acquisition Corp. (the "Purchaser" or "Acquisition Sub") of substantially all of the assets of Cardinal Peak Industries, Inc. ("CPI" or the "Seller"). This letter is intended to serve as a consolidated reference for the key terms, outstanding post-closing obligations, and important dates arising out of the transaction. We recommend that this letter be circulated to the relevant members of the Ardent Capital team and retained alongside the executed transaction documents for ongoing reference.

1. Confirmation of Closing

We are pleased to confirm that the acquisition of substantially all of the assets of CPI closed on June 30, 2024 (the "Closing Date"). As you are aware, the original target closing date was June 20, 2024; the closing was delayed by ten days to allow for the completion of the final landlord consent solicitations and the resolution of certain last-minute title matters relating to the Chattanooga and Nashville clinic facilities. Notwithstanding the delay, all material conditions to closing were satisfied or waived, and closing was completed in an orderly fashion.

The Purchaser, Ardent Healthcare Acquisition Corp., is a Delaware corporation wholly owned by Ardent Capital Partners III LP (the "Fund"). The transaction was structured as an asset purchase and was governed by the Asset Purchase Agreement dated April 2, 2024, by and between the Purchaser and CPI (the "APA"), together with all exhibits, schedules, and ancillary documents executed in connection therewith.

Purchase Price and Funding. The key financial terms of the transaction at closing were as follows:

• Base Purchase Price: $620,000,000 (Six Hundred Twenty Million Dollars), subject to post-closing adjustment for net working capital as described in Section 2.1 below.

• Cash Paid to Seller at Closing (Net of Escrow): $558,000,000 (Five Hundred Fifty-Eight Million Dollars), representing the Base Purchase Price less the escrow holdback described below.

• Escrow Holdback: $62,000,000 (Sixty-Two Million Dollars), equal to 10% of the Base Purchase Price, was deposited at closing with Commonwealth Trust & Escrow Company, as escrow agent, in accordance with the Escrow Agreement executed concurrently with the APA. The escrow fund is subject to the release schedule described in Section 2.3 below.

• Equity Contribution: Ardent Capital Partners III LP contributed $220,000,000 (Two Hundred Twenty Million Dollars) in equity to fund a portion of the purchase price.

• Debt Financing: The balance of the purchase price was funded through a Term Loan A in the principal amount of $310,000,000 (Three Hundred Ten Million Dollars), provided by Pinnacle National Bank, N.A. as Administrative Agent and Lead Arranger, together with the syndicate lenders Horizon Commercial Lending Corp., Tidewater Savings Bank, N.A., and Great Plains Capital Partners LLC, each in its capacity as a lender under the Credit Agreement dated June 30, 2024 (the "Credit Agreement"). In addition, a $90,000,000 (Ninety Million Dollars) Revolving Credit Facility was established under the Credit Agreement and was available but undrawn at closing. The Revolving Credit Facility remains available to the Purchaser for working capital and general corporate purposes, subject to the terms and conditions of the Credit Agreement, including customary borrowing conditions.

Payoff of Seller's Existing Indebtedness. At closing, all of CPI's existing indebtedness in the aggregate amount of $87,400,000, outstanding under that certain Credit Agreement dated March 15, 2018, as amended, by and among CPI and Velthorn Merchant Bank, N.A., as administrative agent, was paid off in full. In connection with the payoff, UCC-3 termination statements were filed with the Delaware Secretary of State and the Tennessee Secretary of State on June 28, 2024, two business days prior to the Closing Date, to release all security interests and liens of Velthorn Merchant Bank, N.A. in and to the assets of CPI. We have confirmed the acceptance of these filings and have copies of the filed termination statements on record.

Closing Deliverables. All material closing deliverables were duly executed and exchanged by the parties at or prior to the Closing, including without limitation the following:

(a) Bill of Sale, executed by CPI in favor of the Purchaser;

(b) Assignment and Assumption Agreement, executed by both CPI and the Purchaser;

(c) intellectual Property Assignment Agreement, including the assignment of the PeakConnect patient-engagement software platform and associated trademarks, executed by CPI in favor of the Purchaser;

(d) Transition Services Agreement, executed by CPI and the Purchaser;

(e) Earnout Agreement, executed by CPI and the Purchaser;

(f) Escrow Agreement, executed by CPI, the Purchaser, and Commonwealth Trust & Escrow Company;

(g) Employment Agreement and Non-Competition and Non-Solicitation Agreement for Dr. Randall J. Whitfield, each executed by Dr. Whitfield and the Purchaser;

(h) Employment Agreement and Non-Competition and Non-Solicitation Agreement for Elaine Whitfield-Torres, each executed by Whitfield-Torres and the Purchaser;

(i) Officer's Certificates of both CPI and the Purchaser, certifying the satisfaction of closing conditions, the accuracy of representations and warranties as of the Closing Date, and related matters;

(j) Secretary's Certificates of both CPI and the Purchaser, attaching certified copies of organizational documents, board resolutions, and incumbency certificates;

(k) FIRPTA Certificate, executed by CPI, certifying that CPI is not a foreign person within the meaning of Section 1445 of the Internal Revenue Code;

(l) all required real property and lease-related documents, including landlord consent letters; and

(m) Funds Flow Memorandum and the Closing Statement, executed by all relevant parties.

Legal Opinion. The legal opinion of Calderwood & Harkness LLP was delivered to Pinnacle National Bank, N.A., as Administrative Agent, at closing, as required under the Credit Agreement. The opinion addressed, among other matters, the due organization and good standing of the Purchaser, the enforceability of the Credit Agreement and related loan documents, and the validity and perfection of the security interests granted thereunder.

Representations and Warranties Insurance. The representations and warranties insurance policy (Policy No. SSI-RWI-2024-05178) issued by Sentinel Specialty Insurance Company was bound on April 10, 2024, and remains in full force and effect as of the date of this letter. The policy is described in greater detail in Section 2.5 below.

On behalf of the entire Calderwood & Harkness deal team, we congratulate the Ardent Capital team on the successful completion of this transaction. This was a complex, multi-state healthcare asset acquisition with significant regulatory, financing, and structural considerations, and the dedication and professionalism of the Ardent team — in particular, Connor Briggs, who served as the day-to-day deal lead — were instrumental in bringing the transaction to a successful close. We look forward to continuing to work with you on the post-closing matters described below.

2. Summary of Post-Closing Obligations and Key Dates

The following sections describe the key post-closing obligations, deadlines, and considerations arising under the APA, the ancillary agreements, and the financing documents. We strongly recommend that Ardent Capital establish an internal tracking and calendar system for the dates and deadlines described below to ensure timely compliance with all contractual obligations.

2.1 Net Working Capital True-Up

Under Section 2.6 of the APA, the Base Purchase Price is subject to a post-closing adjustment based on the final determination of the net working capital ("NWC") of CPI as of the Closing Date, as compared to the NWC Target of $28,000,000 (Twenty-Eight Million Dollars). The Estimated Closing NWC, as set forth in the Closing Statement prepared by CPI and delivered at Closing, was $29,200,000 (Twenty-Nine Million Two Hundred Thousand Dollars), representing an estimated surplus of $1,200,000 above the NWC Target.

Under the terms of the APA, the final NWC determination must be completed within ninety (90) days following the Closing Date. Accordingly, the deadline for the final NWC determination is September 28, 2024. The Purchaser is responsible for preparing the final closing date balance sheet and the final NWC calculation, and delivering the same to CPI within this period.

The NWC adjustment mechanism provides for a dollar-for-dollar adjustment above or below the NWC Target, subject to a $500,000 de minimis collar. If the final NWC exceeds the NWC Target by $500,000 or less, or falls below the NWC Target by $500,000 or less, no adjustment will be made. If the difference exceeds $500,000 in either direction, the full amount of the difference (not merely the excess over $500,000) will be paid by the applicable party. If the final NWC exceeds the NWC Target by more than $500,000, the Purchaser will pay the difference to CPI. If the final NWC falls below the NWC Target by more than $500,000, CPI will refund the difference to the Purchaser.

Ashford & Creighton LLP (Gregory Nolan, Partner, Transaction Advisory Services) has been engaged to assist with the preparation and review of the final NWC calculation. We recommend that the Ardent finance team begin compiling the closing-date balance sheet data promptly, including the reconciliation of all accounts receivable, accounts payable, accrued liabilities, prepaid expenses, and inventory as of June 30, 2024. Given the complexity of CPI's multi-state operations and the volume of patient-related receivables, early engagement on this matter will be critical to meeting the September 28, 2024 deadline.

In the event of a dispute between the Purchaser and CPI regarding the final NWC determination, the APA provides for a dispute resolution mechanism whereby the parties will first attempt to resolve the dispute in good faith within thirty (30) days, and if the dispute remains unresolved, the matter will be submitted to an independent accounting firm mutually agreed upon by the parties (or, absent agreement, selected by the American Arbitration Association), whose determination will be final and binding. The costs of the independent accounting firm will be allocated between the parties based on the proportion of the disputed amount resolved in each party's favor.

2.2 Earnout Monitoring and Payment Obligations

The Earnout Agreement, executed on June 30, 2024, by and between the Purchaser and CPI, provides for contingent consideration of up to $45,000,000 (Forty-Five Million Dollars) in the aggregate, payable to CPI in two tranches based on the financial performance of the Acquired Business during the applicable earnout periods. The earnout is an important element of the transaction structure and warrants careful attention and monitoring by the Ardent team.

Earnout Tranche 1. Up to $22,500,000 (Twenty-Two Million Five Hundred Thousand Dollars) is payable to CPI if the Acquired Business achieves Adjusted EBITDA of $85,000,000 or more for the twelve-month period ending June 30, 2025 ("Earnout Period 1"). The payout is calculated on a linear ramp basis as follows:

• If the Acquired Business achieves Adjusted EBITDA at or below the $80,000,000 threshold, no amount is payable under Tranche 1.

• For each $1 of Adjusted EBITDA above the $80,000,000 threshold, $4.50 is payable, resulting in a maximum payout of $22,500,000 at Adjusted EBITDA of $85,000,000 or more.

Earnout Tranche 2. Up to $22,500,000 (Twenty-Two Million Five Hundred Thousand Dollars) is payable to CPI if the Acquired Business achieves Adjusted EBITDA of $95,000,000 or more for the twelve-month period ending June 30, 2026 ("Earnout Period 2"). The payout is calculated on the same linear ramp basis as follows:

• If the Acquired Business achieves Adjusted EBITDA at or below the $90,000,000 threshold, no amount is payable under Tranche 2.

• For each $1 of Adjusted EBITDA above the $90,000,000 threshold, $4.50 is payable, resulting in a maximum payout of $22,500,000 at Adjusted EBITDA of $95,000,000 or more.

Change of Control Acceleration. We wish to call particular attention to the change of control acceleration provision in the Earnout Agreement. If a "change of control" of the Acquired Business or Ardent Healthcare Acquisition Corp. occurs prior to the end of an Earnout Period, 100% of the maximum remaining earnout becomes immediately due and payable. This provision has significant implications for any future exit or disposition planning by the Fund, and we recommend that Ardent take this provision into careful account in connection with any contemplated sale, recapitalization, or other change-of-control transaction during the earnout periods. In practical terms, if a change of control were to occur on, for example, January 1, 2025 — before the end of either Earnout Period — the full $45,000,000 would become immediately due and payable to CPI, regardless of the actual financial performance of the Acquired Business.

Adjusted EBITDA Calculation. The earnout calculation methodology, including the detailed definition of "Adjusted EBITDA," is set forth in Exhibit A to the Earnout Agreement. The definition includes customary add-backs and exclusions, and was extensively negotiated during the transaction. We recommend close coordination between the Ardent deal team and the operating management of the Acquired Business — in particular, Dr. Randall J. Whitfield (CEO) and Elaine Whitfield-Torres (CCO) — to ensure consistent financial reporting practices and the avoidance of disputes regarding the application of the Adjusted EBITDA definition. Given the potential magnitude of the earnout payments, and the sensitivity of certain discretionary items within the EBITDA calculation, Ardent should consider establishing clear internal policies and protocols for the treatment of non-recurring items, management fees, intercompany charges, and other items that could affect the calculation.

Tax Treatment. Earnout payments, if and when made, constitute additional purchase price for federal income tax purposes and will be subject to the purchase price allocation methodology set forth in the Section 338 / Asset Allocation Memorandum dated March 18, 2024, prepared by Sylvia Hartwell. Please refer to the Tax Structure Memorandum dated February 8, 2024, also prepared by Sylvia Hartwell, for further discussion of the tax treatment of contingent consideration in the context of this transaction.

2.3 Escrow Release Schedule

The Escrow Agreement, executed on June 30, 2024, by and among the Purchaser, CPI, and Commonwealth Trust & Escrow Company (the "Escrow Agent"), governs the holding, investment, and release of the $62,000,000 escrow fund. The primary contact at the Escrow Agent is Martin Galbraith, Vice President, Corporate Trust Services, located at 3801 Kennett Pike, Suite 250, Greenville, DE 19807. The Escrow Agreement is governed by the laws of the State of Delaware.

The escrow fund is subject to the following release schedule:

Tranche 1 Release. $31,000,000 (Thirty-One Million Dollars) is scheduled to be released to CPI on June 30, 2025, the twelve-month anniversary of the Closing Date, net of any amounts then subject to pending or resolved indemnification claims asserted by the Purchaser against the escrow fund.

Tranche 2 Release (Final). $31,000,000 (Thirty-One Million Dollars) is scheduled to be released to CPI on December 30, 2025, the eighteen-month anniversary of the Closing Date, net of any amounts then subject to pending or resolved indemnification claims asserted by the Purchaser against the escrow fund.

With respect to each scheduled release, any indemnification claims that have been asserted by the Purchaser but remain unresolved at the time of a scheduled release will result in a holdback from the release in an amount equal to the claimed amount (or such other amount as the Escrow Agent may determine to be appropriate based on the terms of the Escrow Agreement). Upon resolution of any such claim, the escrow fund (or the applicable portion thereof) will be disbursed in accordance with the resolution. Ardent should ensure that any indemnification claims are properly asserted and documented in accordance with the notice provisions of both the APA and the Escrow Agreement, and we recommend consulting with Calderwood & Harkness prior to delivering any claim notice to the Escrow Agent.

2.4 Indemnification — Survival Periods and Claim Deadlines

The indemnification provisions of Article IX of the APA establish the framework for the parties' post-closing indemnification obligations. The following is a summary of the key survival periods, thresholds, and limitations applicable to indemnification claims:

Survival Periods:

(a) General Representations and Warranties: The representations and warranties of the Seller (other than the Fundamental Representations and the Tax Representations) survive for a period of eighteen (18) months following the Closing Date, i.e., through December 30, 2025. Any claims based on breaches of the general representations and warranties must be asserted in writing on or before December 30, 2025.

(b) Fundamental Representations: The Fundamental Representations (which include representations regarding organization, authorization, capitalization, title to assets, and brokers' fees) survive for a period of thirty-six (36) months following the Closing Date, i.e., through June 30, 2027. Claims based on breaches of the Fundamental Representations must be asserted in writing on or before June 30, 2027.

(c) Tax Representations: The Tax Representations survive until sixty (60) days after the expiration of the applicable statute of limitations (including any extensions thereof) for the relevant tax period or tax matter giving rise to the claim. Given the multi-state nature of CPI's operations and the varying state-level statutes of limitations, the expiration dates for Tax Representation survival may differ depending on the particular state and tax type at issue.

Indemnification Limitations:

(d) Indemnification Cap: The aggregate liability of the Seller for indemnification claims under the APA is capped at $124,000,000 (One Hundred Twenty-Four Million Dollars), which is equal to 20% of the Base Purchase Price.

(e) Basket (Deductible): The Seller is not required to indemnify the Purchaser for Losses unless and until the aggregate amount of all indemnifiable Losses exceeds $3,100,000 (Three Million One Hundred Thousand Dollars), which is equal to 0.5% of the Base Purchase Price. The basket operates as a tipping basket — once the $3,100,000 threshold is exceeded, the Seller is obligated to indemnify the Purchaser from the first dollar of Losses (not merely for Losses in excess of the basket).

(f) De Minimis Threshold: Individual claims for Losses of less than $100,000 (One Hundred Thousand Dollars) are excluded from the indemnification framework and do not count toward the basket.

(g) Exclusive Remedy: Indemnification under Article IX of the APA is the exclusive post-closing remedy of the parties for any claims arising out of or relating to the APA, other than claims based on fraud, willful breach, or equitable relief (including specific performance). This limitation underscores the importance of identifying and asserting any potential indemnification claims within the applicable survival periods.

We strongly recommend that Ardent establish internal procedures for the identification, tracking, and documentation of any potential indemnification claims. Such procedures should include regular communication between the operating management of the Acquired Business and the Ardent deal team, as well as prompt notification to Calderwood & Harkness upon the discovery of any facts or circumstances that could give rise to an indemnification claim. Timely assertion of claims is critical, as the expiration of the applicable survival period will bar any claims not previously asserted.

2.5 Representations and Warranties Insurance

As noted above, a representations and warranties insurance policy was obtained in connection with the transaction. The key terms of the policy are as follows:

• Carrier: Sentinel Specialty Insurance Company

• Policy Number: SSI-RWI-2024-05178

• Coverage Limit: $62,000,000 (Sixty-Two Million Dollars), equal to 10% of the Base Purchase Price

• Retention: $6,200,000 (Six Million Two Hundred Thousand Dollars), equal to 1% of the Base Purchase Price. The retention is split 50/50 between the Buyer's indemnification basket under the APA and the Seller's indemnification obligation, such that the first $3,100,000 of Losses is borne by the Buyer under the basket and the next $3,100,000 is recoverable from the Seller under the APA indemnification framework, before the R&W policy responds.

• Broker: Alder Risk Partners LLC (Philip Yuen, Senior Vice President)

Key Exclusions. The policy contains certain exclusions, the most significant of which include: (i) the pending Dawson litigation (described in Section 2.8 below), which was identified as a known matter during the underwriting process; and (ii) certain known tax matters identified during the due diligence process and disclosed to the carrier. The complete list of exclusions is set forth in the policy endorsements, copies of which are included in the closing binder.

Coordination with APA Indemnification. The R&W insurance policy is structured to coordinate with the indemnification framework set forth in the APA. In general, the policy covers Losses arising out of breaches of the Seller's representations and warranties in the APA, subject to the policy terms, conditions, and exclusions. The policy does not replace the Seller's indemnification obligations under the APA but provides an additional layer of recovery for the Purchaser.

Claim Notification. We recommend that Ardent promptly notify Sentinel Specialty Insurance Company of any potential claims during the policy period, in accordance with the notice provisions of the policy. Given the complexity of R&W insurance claims and the potential for coverage disputes, we strongly recommend that Ardent consult with Calderwood & Harkness before making any notification to the carrier or taking any other action that could affect coverage under the policy.

2.6 Transition Services Agreement Wind-Down

Under the Transition Services Agreement (the "TSA"), executed on June 30, 2024, CPI is providing transitional back-office, information technology, and administrative services to the Purchaser for a period of up to nine (9) months following the Closing Date, i.e., through March 30, 2025. The services covered by the TSA include, among others, accounts payable and receivable processing, payroll administration, information technology infrastructure and support, human resources administration, and certain regulatory reporting functions.

The TSA contemplates that the Purchaser will assume responsibility for each service function on a rolling basis as the Purchaser develops internal capabilities or engages third-party providers. The Purchaser is required to provide CPI with advance written notice of the termination of each service category, in accordance with the notice periods specified in the applicable service schedule.

We recommend that Ardent begin planning for the internalization or replacement of these services at the earliest practicable date. A prolonged reliance on CPI for transitional services creates operational risk and may complicate the post-closing relationship between the parties. In particular, Ardent should prioritize the transition of IT systems and data migration, given the sensitivity of patient health information and the associated regulatory requirements.

In connection with the TSA, a HIPAA Business Associate Agreement has been executed by the parties to address the handling of protected health information during the transition period. The requirements and compliance obligations under the Business Associate Agreement are discussed in detail in the Healthcare Regulatory Compliance Memorandum dated March 20, 2024, a copy of which is included in the closing binder. Ardent should ensure strict compliance with all HIPAA and HITECH Act requirements throughout the TSA period and beyond.

2.7 Employment and Non-Competition Agreements

The continued involvement of the two key executives of the Acquired Business is integral to the earnout mechanism, operational continuity, and the overall investment thesis. The following employment and restrictive covenant arrangements were executed at closing:

Dr. Randall J. Whitfield:

• Employment Agreement: Dr. Whitfield has been engaged as Chief Executive Officer of the Acquired Business under an Employment Agreement with a three-year term commencing June 30, 2024 and expiring June 30, 2027.

• Non-Competition and Non-Solicitation Agreement: Dr. Whitfield has entered into a Non-Competition and Non-Solicitation Agreement with a three-year restrictive covenant period, covering the states of Tennessee, Georgia, North Carolina, South Carolina, Alabama, Virginia, and Kentucky. The agreement restricts Dr. Whitfield from engaging in, or providing services to, any competing healthcare services business within the specified geographic area, and from soliciting employees, customers, or referral sources of the Acquired Business, for a period of three years from the Closing Date.

• Both agreements are governed by Tennessee law.

Elaine Whitfield-Torres:

• Employment Agreement: Whitfield-Torres has been engaged as Chief Commercial Officer of the Acquired Business under an Employment Agreement with a three-year term commencing June 30, 2024 and expiring June 30, 2027.

• Non-Competition and Non-Solicitation Agreement: Whitfield-Torres has entered into a Non-Competition and Non-Solicitation Agreement with a three-year restrictive covenant period, covering the same seven-state geographic area. The terms and scope of the restrictions are substantially identical to those applicable to Dr. Whitfield.

• Both agreements are governed by Tennessee law.

As noted above, the continued involvement of Dr. Whitfield and Whitfield-Torres is closely tied to the earnout structure. Any material changes to their employment status — including termination, resignation, or a change in responsibilities — could have significant implications for the earnout calculation and should be carefully considered and discussed with legal counsel.

2.8 Excluded Liabilities — Dawson Litigation Monitoring

The pending putative class action, Dawson v. Cardinal Peak Industries, Inc., Case No. 3:23-cv-01847 (United States District Court, Middle District of Tennessee), alleging violations of the Fair Labor Standards Act ("FLSA") in connection with CPI's wage-and-hour practices, is an Excluded Liability under the APA. The complaint alleges that CPI misclassified certain clinical support staff as exempt employees and failed to pay overtime compensation in accordance with the FLSA. CPI's outside counsel has estimated the potential exposure in this matter at between $2.8 million and $5.1 million, depending on the outcome of class certification and the scope of opt-in plaintiffs.

CPI (the Seller) retains all responsibility for the defense and resolution of this litigation and has provided a specific indemnification obligation to the Purchaser with respect to any Losses arising therefrom. The Purchaser has no obligation to defend or participate in the Dawson litigation, although the parties have agreed to cooperate reasonably with respect to the production of documents and access to personnel as may be required.

Notwithstanding the excluded-liability treatment, we recommend that Ardent monitor the progress of this litigation on an ongoing basis, given the operational overlap between CPI's former operations and the Acquired Business. In particular, Ardent should be attentive to any rulings on class certification, any expansion of the scope of claims, and any settlement discussions that could have implications for the Acquired Business. Calderwood & Harkness or Barrow, Kensington & Pratt LLP (which represents CPI in the Dawson matter) can provide periodic updates as appropriate.

2.9 intellectual Property — Corporate Name License-Back

Under the intellectual Property Assignment Agreement executed at closing, substantially all of CPI's intellectual property was assigned to the Purchaser, including the PeakConnect patient-engagement software platform and the associated registered trademark (United States Patent and Trademark Office Registration No. 5,412,887). In consideration of CPI's ongoing corporate needs during the wind-down period, CPI has been granted a twelve-month license-back of the "Cardinal Peak Industries" corporate name, expiring on June 30, 2025. The license is limited, non-exclusive, and revocable in accordance with the terms of the IP Assignment Agreement.

We recommend the following actions in connection with the intellectual property matters:

(a) Trademark Assignment Recordation. Ardent should confirm that the assignment of the PeakConnect trademark (U.S. Reg. No. 5,412,887) is timely recorded with the USPTO. Recording the assignment provides constructive notice to third parties and is a prerequisite to certain enforcement actions. We can assist with this filing if requested.

(b) Corporate Name License Monitoring. Ardent should calendar the expiration of the corporate name license-back on June 30, 2025, and ensure that CPI ceases all use of the "Cardinal Peak Industries" name upon expiration.

(c) Domain Name and Digital Asset Transfers. To the extent not already completed, Ardent should confirm that all domain names, social media accounts, and other digital assets associated with the PeakConnect platform and the Acquired Business have been transferred to the Purchaser's control.

2.10 Healthcare Regulatory Filings and Ongoing Compliance

Given the regulated nature of the Acquired Business, ongoing compliance with applicable healthcare laws and regulations is of critical importance. The following matters warrant continued attention:

Change-of-Ownership Filings. Change-of-ownership notices were filed with the applicable state regulatory agencies in Tennessee, Georgia, and North Carolina on March 4, 2024, well in advance of the Closing Date. Similar filings were completed for South Carolina, Alabama, Virginia, and Kentucky on the applicable timelines. The status of all such filings should be monitored to ensure that final approvals and updated licenses are received from each state.

Medicare/Medicaid Enrollment. Medicare and Medicaid enrollment updates and provider agreement transfers are in process and should be monitored in close coordination with Hargrove, Sinclair & Demarest LLP (Angela Demarest, Partner, Healthcare Regulatory). The timely completion of these transfers is essential to ensure uninterrupted reimbursement from federal and state healthcare programs. Any gap in enrollment could result in a loss of revenue and potential compliance exposure.

Anti-Kickback Statute and Stark Law Compliance. The ongoing compliance of the Acquired Business with the federal Anti-Kickback Statute (42 U.S.C. § 1320a-7b(b)) and the Physician Self-Referral Law (Stark Law) (42 U.S.C. § 1395nn) was analyzed in detail in the joint Healthcare Regulatory Compliance Memorandum dated March 20, 2024, prepared by Calderwood & Harkness and Hargrove, Sinclair & Demarest LLP. The recommendations set forth in that memorandum, including the implementation of certain compliance program enhancements and the restructuring of certain physician compensation arrangements, should be implemented promptly by the operating management of the Acquired Business.

2.11 Lease Matters

The Acquired Business operates 37 clinic locations across seven states under triple-net leases. The geographic distribution of these clinic locations is as follows: Tennessee (14 locations), Georgia (8 locations), North Carolina (5 locations), South Carolina (4 locations), Alabama (3 locations), Virginia (2 locations), and Kentucky (1 location).

Of the 37 leases, 29 leases contained provisions requiring landlord consent in connection with the asset purchase. Substantially all of the required landlord consents were obtained prior to or at the time of closing. To the extent that any landlord consents remain outstanding, they should be tracked to completion as expeditiously as possible. An outstanding landlord consent may, depending on the terms of the applicable lease, give the landlord the right to terminate the lease or to assert a default, and timely resolution is therefore important.

Tiffany Rosenthal (Calderwood & Harkness, Real Estate Group) has maintained a detailed Lease Consent Tracker throughout the transaction, and this tracker is available for reference. We recommend that the Ardent operations team obtain a current copy of the tracker and follow up directly with any landlords from whom consents remain outstanding.

2.12 Tax — Purchase Price Allocation (IRS Form 8594)

A draft IRS Form 8594 (Asset Acquisition Statement Under Section 1060 of the Internal Revenue Code) has been prepared by Sylvia Hartwell (Calderwood & Harkness, Tax Group), allocating the $620,000,000 Base Purchase Price among the seven asset classes specified in the Treasury Regulations. The allocation reflects the agreed-upon fair market values of the acquired assets, including tangible personal property, real property interests, intangible assets (including goodwill and going-concern value), and the PeakConnect intellectual property.

The Form 8594 should be finalized following the completion of the NWC true-up (deadline: September 28, 2024), as any adjustment to the purchase price resulting from the NWC true-up will affect the total consideration to be allocated. The finalized Form 8594 must be filed by both the Purchaser and CPI with their respective federal income tax returns for the taxable year that includes the Closing Date.

In addition, any earnout payments made under the Earnout Agreement will be treated as adjustments to the purchase price allocation and will require the filing of supplemental or amended Forms 8594 in the years in which such payments are made. The methodology for allocating earnout payments among the asset classes is addressed in the Section 338 / Asset Allocation Memorandum dated March 18, 2024, prepared by Sylvia Hartwell.

3. Summary Calendar of Key Post-Closing Dates

For ease of reference, the following table summarizes the key post-closing dates and obligations arising from the transaction:

We recommend that these dates be entered into Ardent's internal compliance calendar and that responsibility for monitoring each obligation be assigned to a specific member of the Ardent team. Missed deadlines — particularly with respect to indemnification claim assertion and the NWC true-up — can result in the permanent loss of contractual rights.

4. Document Retention Recommendations

Calderwood & Harkness will maintain the complete closing set and all transaction documents in our files in accordance with the firm's document retention policies. However, we strongly recommend that Ardent Capital Management LLC and Ardent Capital Partners III LP maintain their own independent copies of all material transaction documents. We recommend that the following documents be retained in perpetuity or, at minimum, through the expiration of all survival, earnout, indemnification, and applicable statute-of-limitations periods:

(a) Executed Asset Purchase Agreement and all exhibits, schedules, and amendments thereto, including the Disclosure Schedules;

(b) All ancillary agreements, including the Bill of Sale, Assignment and Assumption Agreement, intellectual Property Assignment Agreement, Transition Services Agreement, Earnout Agreement, and Escrow Agreement;

(c) Employment Agreements and Non-Competition and Non-Solicitation Agreements for Dr. Randall J. Whitfield and Elaine Whitfield-Torres;

(d) All closing certificates, officer's certificates, and secretary's certificates delivered at closing;

(e) Financing documents, including the Credit Agreement with Pinnacle National Bank, N.A., the commitment letter, the security agreement, and all related loan documents;

(f) Funds Flow Memorandum and the Closing Statement;

(g) Representations and warranties insurance policy (Policy No. SSI-RWI-2024-05178) and all related correspondence, including the underwriting submission, broker materials, and policy endorsements;

(h) All due diligence reports, memoranda, and third-party diligence materials, including the Quality of Earnings report and the environmental site assessments;

(i) Tax memoranda, including the Tax Structure Memorandum dated February 8, 2024, the Section 338 / Asset Allocation Memorandum dated March 18, 2024, and the draft IRS Form 8594;

(j) Healthcare regulatory filings and correspondence, including change-of-ownership applications, state licensing documents, and the Healthcare Regulatory Compliance Memorandum dated March 20, 2024;

(k) Payoff letter from Velthorn Merchant Bank, N.A. and UCC-3 termination statement confirmations from the Delaware and Tennessee Secretaries of State;

(l) FIRPTA Certificate executed by CPI; and

(m) All board resolutions, consents, and organizational documents of both the Purchaser and CPI.

Records relating to the earnout should be maintained through at least June 30, 2026 (the end of Earnout Period 2), plus any applicable dispute resolution period that may extend beyond that date. Records relating to indemnification claims and the R&W insurance policy should be maintained through at least June 30, 2027 (the expiration of the Fundamental Representations survival period), and potentially longer with respect to Tax Representations and any pending claims. In general, we advise erring on the side of retention rather than destruction, particularly with respect to documents that may be relevant to any potential disputes or regulatory inquiries.

5. Continuing Availability of Counsel

Calderwood & Harkness remains available to assist Ardent Capital with all post-closing matters arising from the transaction. Our ongoing representation encompasses, without limitation, the following areas:

• NWC dispute resolution, including engagement with the independent accounting firm if necessary;

• Earnout calculation review, including analysis of Adjusted EBITDA determinations and dispute resolution under the Earnout Agreement;

• Escrow release procedures, including review of claim notices and coordination with Commonwealth Trust & Escrow Company;

• Indemnification claims, including the identification, investigation, and assertion of claims against CPI under Article IX of the APA;

• R&W insurance claims, including notification to Sentinel Specialty Insurance Company and management of the claims process;

• Transition Services Agreement issues, including dispute resolution and service termination matters;

• Healthcare regulatory compliance, including coordination with Hargrove, Sinclair & Demarest LLP on ongoing licensing, enrollment, and compliance matters;

• Tax filings and related matters, including finalization of IRS Form 8594 and coordination with Sylvia Hartwell and Ashford & Creighton LLP (Gregory Nolan); and

• General post-closing advisory matters, including lease consent follow-up, intellectual property recordation, and corporate governance matters for the Purchaser.

Matter No. 2024-M&A-0142 remains open for all post-closing matters. The primary contacts for post-closing matters are:

• Beatrice Holloway, Partner (Responsible Partner) — (212) 555-7812 / bholloway@calderwoodharkness.com

• Derek Okonkwo, Associate (Lead Associate) — (212) 555-7834 / dokonkwo@calderwoodharkness.com

Please do not hesitate to reach out to either Beatrice or Derek with any questions or matters requiring attention.

In closing, we wish to express our sincere appreciation for the opportunity to represent Ardent Capital Partners III LP and Ardent Capital Management LLC in this significant transaction. The acquisition of CPI represents a meaningful addition to the Fund's healthcare portfolio, and we were privileged to serve as your counsel throughout the process. We would be remiss if we did not acknowledge the exceptional contributions of the full deal team, whose collaborative efforts were essential to the successful closing: Connor Briggs, who served as Ardent's day-to-day deal lead with extraordinary dedication and precision; Nathaniel Prescott and his team at Graystone Partners LLC, who provided invaluable financial advisory services; Gregory Nolan and his colleagues at Ashford & Creighton LLP, who managed the financial due diligence and transaction advisory workstreams; and Angela Demarest at Hargrove, Sinclair & Demarest LLP, who navigated the complex healthcare regulatory landscape with skill and thoroughness.

We look forward to continuing to work with the Ardent team on the post-closing matters described in this letter and on future transactions.

With warm regards,

CALDERWOOD & HARKNESS LLP

By: ________

Beatrice Holloway Partner One World Financial Center 200 Liberty Street, 40th Floor New York, NY 10281 Telephone: (212) 555-7812

Email: bholloway@calderwoodharkness.com

cc:

Connor Briggs, Vice President, Ardent Capital Management LLC James Prentice, Partner, Calderwood & Harkness LLP Derek Okonkwo, Associate, Calderwood & Harkness LLP Sylvia Hartwell, Partner (Tax), Calderwood & Harkness LLP

Enclosures:

Enclosed via secure file transfer link (to be provided under separate cover): Complete Closing Binder, including index of all executed transaction documents, ancillary agreements, closing certificates, financing documents, and related materials. A USB drive containing the complete closing binder will also be delivered by hand to the offices of Ardent Capital Management LLC at 590 Madison Avenue, 34th Floor, New York, NY 10022 on or before July 10, 2024.

Date	Obligation / Event
September 28, 2024	Deadline for final NWC determination (90 days post-closing)
March 30, 2025	Expiration of Transition Services Agreement (9 months post-closing)
June 30, 2025	Escrow Tranche 1 release ($31,000,000); Earnout Period 1 ends; CPI corporate name license-back expires
December 30, 2025	Escrow Tranche 2 (final) release ($31,000,000); General Representations and Warranties survival period expiration
June 30, 2026	Earnout Period 2 ends
June 30, 2027	Fundamental Representations survival period expiration; Employment Agreement and Non-Competition Agreement terms expire for Dr. Whitfield and Whitfield-Torres

PRIVILEGED & CONFIDENTIAL ATTORNEY-CLIENT COMMUNICATION
CALDERWOOD & HARKNESS LLP One World Financial Center 200 Liberty Street, 40th Floor New York, NY 10281
Telephone: (212) 555-7800 Facsimile: (212) 555-7801 www.calderwoodharkness.com
July 3, 2024
Matter No.: 2024-M&A-0142
VIA ELECTRONIC MAIL AND HAND DELIVERY
Marcus Ainsworth, Esq. Managing Partner & Co-Founder Ardent Capital Management LLC 590 Madison Avenue, 34th Floor New York, NY 10022
Priya Mehta-Sullivan Partner, Head of Healthcare Investments Ardent Capital Management LLC 590 Madison Avenue, 34th Floor New York, NY 10022
Re: Completion of Acquisition of Substantially All Assets of Cardinal Peak Industries, Inc. by Ardent Healthcare Acquisition Corp. — Post-Closing Summary and Outstanding Obligations
Dear Marcus and Priya:
We are pleased to provide this comprehensive post-closing summary letter in connection with the acquisition by Ardent Healthcare Acquisition Corp. (the "Purchaser" or "Acquisition Sub") of substantially all of the assets of Cardinal Peak Industries, Inc. ("CPI" or the "Seller"). This letter is intended to serve as a consolidated reference for the key terms, outstanding post-closing obligations, and important dates arising out of the transaction. We recommend that this letter be circulated to the relevant members of the Ardent Capital team and retained alongside the executed transaction documents for ongoing reference.
1. Confirmation of Closing
We are pleased to confirm that the acquisition of substantially all of the assets of CPI closed on June 30, 2024 (the "Closing Date"). As you are aware, the original target closing date was June 20, 2024; the closing was delayed by ten days to allow for the completion of the final landlord consent solicitations and the resolution of certain last-minute title matters relating to the Chattanooga and Nashville clinic facilities. Notwithstanding the delay, all material conditions to closing were satisfied or waived, and closing was completed in an orderly fashion.
The Purchaser, Ardent Healthcare Acquisition Corp., is a Delaware corporation wholly owned by Ardent Capital Partners III LP (the "Fund"). The transaction was structured as an asset purchase and was governed by the Asset Purchase Agreement dated April 2, 2024, by and between the Purchaser and CPI (the "APA"), together with all exhibits, schedules, and ancillary documents executed in connection therewith.
Purchase Price and Funding. The key financial terms of the transaction at closing were as follows:
• Base Purchase Price: $620,000,000 (Six Hundred Twenty Million Dollars), subject to post-closing adjustment for net working capital as described in Section 2.1 below.
• Cash Paid to Seller at Closing (Net of Escrow): $558,000,000 (Five Hundred Fifty-Eight Million Dollars), representing the Base Purchase Price less the escrow holdback described below.
• Escrow Holdback: $62,000,000 (Sixty-Two Million Dollars), equal to 10% of the Base Purchase Price, was deposited at closing with Commonwealth Trust & Escrow Company, as escrow agent, in accordance with the Escrow Agreement executed concurrently with the APA. The escrow fund is subject to the release schedule described in Section 2.3 below.
• Equity Contribution: Ardent Capital Partners III LP contributed $220,000,000 (Two Hundred Twenty Million Dollars) in equity to fund a portion of the purchase price.
• Debt Financing: The balance of the purchase price was funded through a Term Loan A in the principal amount of $310,000,000 (Three Hundred Ten Million Dollars), provided by Pinnacle National Bank, N.A. as Administrative Agent and Lead Arranger, together with the syndicate lenders Horizon Commercial Lending Corp., Tidewater Savings Bank, N.A., and Great Plains Capital Partners LLC, each in its capacity as a lender under the Credit Agreement dated June 30, 2024 (the "Credit Agreement"). In addition, a $90,000,000 (Ninety Million Dollars) Revolving Credit Facility was established under the Credit Agreement and was available but undrawn at closing. The Revolving Credit Facility remains available to the Purchaser for working capital and general corporate purposes, subject to the terms and conditions of the Credit Agreement, including customary borrowing conditions.
Payoff of Seller's Existing Indebtedness. At closing, all of CPI's existing indebtedness in the aggregate amount of $87,400,000, outstanding under that certain Credit Agreement dated March 15, 2018, as amended, by and among CPI and Velthorn Merchant Bank, N.A., as administrative agent, was paid off in full. In connection with the payoff, UCC-3 termination statements were filed with the Delaware Secretary of State and the Tennessee Secretary of State on June 28, 2024, two business days prior to the Closing Date, to release all security interests and liens of Velthorn Merchant Bank, N.A. in and to the assets of CPI. We have confirmed the acceptance of these filings and have copies of the filed termination statements on record.
Closing Deliverables. All material closing deliverables were duly executed and exchanged by the parties at or prior to the Closing, including without limitation the following:
(a) Bill of Sale, executed by CPI in favor of the Purchaser;
(b) Assignment and Assumption Agreement, executed by both CPI and the Purchaser;
(c) intellectual Property Assignment Agreement, including the assignment of the PeakConnect patient-engagement software platform and associated trademarks, executed by CPI in favor of the Purchaser;
(d) Transition Services Agreement, executed by CPI and the Purchaser;
(e) Earnout Agreement, executed by CPI and the Purchaser;
(f) Escrow Agreement, executed by CPI, the Purchaser, and Commonwealth Trust & Escrow Company;
(g) Employment Agreement and Non-Competition and Non-Solicitation Agreement for Dr. Randall J. Whitfield, each executed by Dr. Whitfield and the Purchaser;
(h) Employment Agreement and Non-Competition and Non-Solicitation Agreement for Elaine Whitfield-Torres, each executed by Whitfield-Torres and the Purchaser;
(i) Officer's Certificates of both CPI and the Purchaser, certifying the satisfaction of closing conditions, the accuracy of representations and warranties as of the Closing Date, and related matters;
(j) Secretary's Certificates of both CPI and the Purchaser, attaching certified copies of organizational documents, board resolutions, and incumbency certificates;
(k) FIRPTA Certificate, executed by CPI, certifying that CPI is not a foreign person within the meaning of Section 1445 of the Internal Revenue Code;
(l) all required real property and lease-related documents, including landlord consent letters; and
(m) Funds Flow Memorandum and the Closing Statement, executed by all relevant parties.
Legal Opinion. The legal opinion of Calderwood & Harkness LLP was delivered to Pinnacle National Bank, N.A., as Administrative Agent, at closing, as required under the Credit Agreement. The opinion addressed, among other matters, the due organization and good standing of the Purchaser, the enforceability of the Credit Agreement and related loan documents, and the validity and perfection of the security interests granted thereunder.
Representations and Warranties Insurance. The representations and warranties insurance policy (Policy No. SSI-RWI-2024-05178) issued by Sentinel Specialty Insurance Company was bound on April 10, 2024, and remains in full force and effect as of the date of this letter. The policy is described in greater detail in Section 2.5 below.
On behalf of the entire Calderwood & Harkness deal team, we congratulate the Ardent Capital team on the successful completion of this transaction. This was a complex, multi-state healthcare asset acquisition with significant regulatory, financing, and structural considerations, and the dedication and professionalism of the Ardent team — in particular, Connor Briggs, who served as the day-to-day deal lead — were instrumental in bringing the transaction to a successful close. We look forward to continuing to work with you on the post-closing matters described below.
2. Summary of Post-Closing Obligations and Key Dates
The following sections describe the key post-closing obligations, deadlines, and considerations arising under the APA, the ancillary agreements, and the financing documents. We strongly recommend that Ardent Capital establish an internal tracking and calendar system for the dates and deadlines described below to ensure timely compliance with all contractual obligations.
2.1 Net Working Capital True-Up
Under Section 2.6 of the APA, the Base Purchase Price is subject to a post-closing adjustment based on the final determination of the net working capital ("NWC") of CPI as of the Closing Date, as compared to the NWC Target of $28,000,000 (Twenty-Eight Million Dollars). The Estimated Closing NWC, as set forth in the Closing Statement prepared by CPI and delivered at Closing, was $29,200,000 (Twenty-Nine Million Two Hundred Thousand Dollars), representing an estimated surplus of $1,200,000 above the NWC Target.
Under the terms of the APA, the final NWC determination must be completed within ninety (90) days following the Closing Date. Accordingly, the deadline for the final NWC determination is September 28, 2024. The Purchaser is responsible for preparing the final closing date balance sheet and the final NWC calculation, and delivering the same to CPI within this period.
The NWC adjustment mechanism provides for a dollar-for-dollar adjustment above or below the NWC Target, subject to a $500,000 de minimis collar. If the final NWC exceeds the NWC Target by $500,000 or less, or falls below the NWC Target by $500,000 or less, no adjustment will be made. If the difference exceeds $500,000 in either direction, the full amount of the difference (not merely the excess over $500,000) will be paid by the applicable party. If the final NWC exceeds the NWC Target by more than $500,000, the Purchaser will pay the difference to CPI. If the final NWC falls below the NWC Target by more than $500,000, CPI will refund the difference to the Purchaser.
Ashford & Creighton LLP (Gregory Nolan, Partner, Transaction Advisory Services) has been engaged to assist with the preparation and review of the final NWC calculation. We recommend that the Ardent finance team begin compiling the closing-date balance sheet data promptly, including the reconciliation of all accounts receivable, accounts payable, accrued liabilities, prepaid expenses, and inventory as of June 30, 2024. Given the complexity of CPI's multi-state operations and the volume of patient-related receivables, early engagement on this matter will be critical to meeting the September 28, 2024 deadline.
In the event of a dispute between the Purchaser and CPI regarding the final NWC determination, the APA provides for a dispute resolution mechanism whereby the parties will first attempt to resolve the dispute in good faith within thirty (30) days, and if the dispute remains unresolved, the matter will be submitted to an independent accounting firm mutually agreed upon by the parties (or, absent agreement, selected by the American Arbitration Association), whose determination will be final and binding. The costs of the independent accounting firm will be allocated between the parties based on the proportion of the disputed amount resolved in each party's favor.
2.2 Earnout Monitoring and Payment Obligations
The Earnout Agreement, executed on June 30, 2024, by and between the Purchaser and CPI, provides for contingent consideration of up to $45,000,000 (Forty-Five Million Dollars) in the aggregate, payable to CPI in two tranches based on the financial performance of the Acquired Business during the applicable earnout periods. The earnout is an important element of the transaction structure and warrants careful attention and monitoring by the Ardent team.
Earnout Tranche 1. Up to $22,500,000 (Twenty-Two Million Five Hundred Thousand Dollars) is payable to CPI if the Acquired Business achieves Adjusted EBITDA of $85,000,000 or more for the twelve-month period ending June 30, 2025 ("Earnout Period 1"). The payout is calculated on a linear ramp basis as follows:
• If the Acquired Business achieves Adjusted EBITDA at or below the $80,000,000 threshold, no amount is payable under Tranche 1.
• For each $1 of Adjusted EBITDA above the $80,000,000 threshold, $4.50 is payable, resulting in a maximum payout of $22,500,000 at Adjusted EBITDA of $85,000,000 or more.
Earnout Tranche 2. Up to $22,500,000 (Twenty-Two Million Five Hundred Thousand Dollars) is payable to CPI if the Acquired Business achieves Adjusted EBITDA of $95,000,000 or more for the twelve-month period ending June 30, 2026 ("Earnout Period 2"). The payout is calculated on the same linear ramp basis as follows:
• If the Acquired Business achieves Adjusted EBITDA at or below the $90,000,000 threshold, no amount is payable under Tranche 2.
• For each $1 of Adjusted EBITDA above the $90,000,000 threshold, $4.50 is payable, resulting in a maximum payout of $22,500,000 at Adjusted EBITDA of $95,000,000 or more.
Change of Control Acceleration. We wish to call particular attention to the change of control acceleration provision in the Earnout Agreement. If a "change of control" of the Acquired Business or Ardent Healthcare Acquisition Corp. occurs prior to the end of an Earnout Period, 100% of the maximum remaining earnout becomes immediately due and payable. This provision has significant implications for any future exit or disposition planning by the Fund, and we recommend that Ardent take this provision into careful account in connection with any contemplated sale, recapitalization, or other change-of-control transaction during the earnout periods. In practical terms, if a change of control were to occur on, for example, January 1, 2025 — before the end of either Earnout Period — the full $45,000,000 would become immediately due and payable to CPI, regardless of the actual financial performance of the Acquired Business.
Adjusted EBITDA Calculation. The earnout calculation methodology, including the detailed definition of "Adjusted EBITDA," is set forth in Exhibit A to the Earnout Agreement. The definition includes customary add-backs and exclusions, and was extensively negotiated during the transaction. We recommend close coordination between the Ardent deal team and the operating management of the Acquired Business — in particular, Dr. Randall J. Whitfield (CEO) and Elaine Whitfield-Torres (CCO) — to ensure consistent financial reporting practices and the avoidance of disputes regarding the application of the Adjusted EBITDA definition. Given the potential magnitude of the earnout payments, and the sensitivity of certain discretionary items within the EBITDA calculation, Ardent should consider establishing clear internal policies and protocols for the treatment of non-recurring items, management fees, intercompany charges, and other items that could affect the calculation.
Tax Treatment. Earnout payments, if and when made, constitute additional purchase price for federal income tax purposes and will be subject to the purchase price allocation methodology set forth in the Section 338 / Asset Allocation Memorandum dated March 18, 2024, prepared by Sylvia Hartwell. Please refer to the Tax Structure Memorandum dated February 8, 2024, also prepared by Sylvia Hartwell, for further discussion of the tax treatment of contingent consideration in the context of this transaction.
2.3 Escrow Release Schedule
The Escrow Agreement, executed on June 30, 2024, by and among the Purchaser, CPI, and Commonwealth Trust & Escrow Company (the "Escrow Agent"), governs the holding, investment, and release of the $62,000,000 escrow fund. The primary contact at the Escrow Agent is Martin Galbraith, Vice President, Corporate Trust Services, located at 3801 Kennett Pike, Suite 250, Greenville, DE 19807. The Escrow Agreement is governed by the laws of the State of Delaware.
The escrow fund is subject to the following release schedule:
Tranche 1 Release. $31,000,000 (Thirty-One Million Dollars) is scheduled to be released to CPI on June 30, 2025, the twelve-month anniversary of the Closing Date, net of any amounts then subject to pending or resolved indemnification claims asserted by the Purchaser against the escrow fund.
Tranche 2 Release (Final). $31,000,000 (Thirty-One Million Dollars) is scheduled to be released to CPI on December 30, 2025, the eighteen-month anniversary of the Closing Date, net of any amounts then subject to pending or resolved indemnification claims asserted by the Purchaser against the escrow fund.
With respect to each scheduled release, any indemnification claims that have been asserted by the Purchaser but remain unresolved at the time of a scheduled release will result in a holdback from the release in an amount equal to the claimed amount (or such other amount as the Escrow Agent may determine to be appropriate based on the terms of the Escrow Agreement). Upon resolution of any such claim, the escrow fund (or the applicable portion thereof) will be disbursed in accordance with the resolution. Ardent should ensure that any indemnification claims are properly asserted and documented in accordance with the notice provisions of both the APA and the Escrow Agreement, and we recommend consulting with Calderwood & Harkness prior to delivering any claim notice to the Escrow Agent.
2.4 Indemnification — Survival Periods and Claim Deadlines
The indemnification provisions of Article IX of the APA establish the framework for the parties' post-closing indemnification obligations. The following is a summary of the key survival periods, thresholds, and limitations applicable to indemnification claims:
Survival Periods:
(a) General Representations and Warranties: The representations and warranties of the Seller (other than the Fundamental Representations and the Tax Representations) survive for a period of eighteen (18) months following the Closing Date, i.e., through December 30, 2025. Any claims based on breaches of the general representations and warranties must be asserted in writing on or before December 30, 2025.
(b) Fundamental Representations: The Fundamental Representations (which include representations regarding organization, authorization, capitalization, title to assets, and brokers' fees) survive for a period of thirty-six (36) months following the Closing Date, i.e., through June 30, 2027. Claims based on breaches of the Fundamental Representations must be asserted in writing on or before June 30, 2027.
(c) Tax Representations: The Tax Representations survive until sixty (60) days after the expiration of the applicable statute of limitations (including any extensions thereof) for the relevant tax period or tax matter giving rise to the claim. Given the multi-state nature of CPI's operations and the varying state-level statutes of limitations, the expiration dates for Tax Representation survival may differ depending on the particular state and tax type at issue.
Indemnification Limitations:
(d) Indemnification Cap: The aggregate liability of the Seller for indemnification claims under the APA is capped at $124,000,000 (One Hundred Twenty-Four Million Dollars), which is equal to 20% of the Base Purchase Price.
(e) Basket (Deductible): The Seller is not required to indemnify the Purchaser for Losses unless and until the aggregate amount of all indemnifiable Losses exceeds $3,100,000 (Three Million One Hundred Thousand Dollars), which is equal to 0.5% of the Base Purchase Price. The basket operates as a tipping basket — once the $3,100,000 threshold is exceeded, the Seller is obligated to indemnify the Purchaser from the first dollar of Losses (not merely for Losses in excess of the basket).
(f) De Minimis Threshold: Individual claims for Losses of less than $100,000 (One Hundred Thousand Dollars) are excluded from the indemnification framework and do not count toward the basket.
(g) Exclusive Remedy: Indemnification under Article IX of the APA is the exclusive post-closing remedy of the parties for any claims arising out of or relating to the APA, other than claims based on fraud, willful breach, or equitable relief (including specific performance). This limitation underscores the importance of identifying and asserting any potential indemnification claims within the applicable survival periods.
We strongly recommend that Ardent establish internal procedures for the identification, tracking, and documentation of any potential indemnification claims. Such procedures should include regular communication between the operating management of the Acquired Business and the Ardent deal team, as well as prompt notification to Calderwood & Harkness upon the discovery of any facts or circumstances that could give rise to an indemnification claim. Timely assertion of claims is critical, as the expiration of the applicable survival period will bar any claims not previously asserted.
2.5 Representations and Warranties Insurance
As noted above, a representations and warranties insurance policy was obtained in connection with the transaction. The key terms of the policy are as follows:
• Carrier: Sentinel Specialty Insurance Company
• Policy Number: SSI-RWI-2024-05178
• Coverage Limit: $62,000,000 (Sixty-Two Million Dollars), equal to 10% of the Base Purchase Price
• Retention: $6,200,000 (Six Million Two Hundred Thousand Dollars), equal to 1% of the Base Purchase Price. The retention is split 50/50 between the Buyer's indemnification basket under the APA and the Seller's indemnification obligation, such that the first $3,100,000 of Losses is borne by the Buyer under the basket and the next $3,100,000 is recoverable from the Seller under the APA indemnification framework, before the R&W policy responds.
• Broker: Alder Risk Partners LLC (Philip Yuen, Senior Vice President)
Key Exclusions. The policy contains certain exclusions, the most significant of which include: (i) the pending Dawson litigation (described in Section 2.8 below), which was identified as a known matter during the underwriting process; and (ii) certain known tax matters identified during the due diligence process and disclosed to the carrier. The complete list of exclusions is set forth in the policy endorsements, copies of which are included in the closing binder.
Coordination with APA Indemnification. The R&W insurance policy is structured to coordinate with the indemnification framework set forth in the APA. In general, the policy covers Losses arising out of breaches of the Seller's representations and warranties in the APA, subject to the policy terms, conditions, and exclusions. The policy does not replace the Seller's indemnification obligations under the APA but provides an additional layer of recovery for the Purchaser.
Claim Notification. We recommend that Ardent promptly notify Sentinel Specialty Insurance Company of any potential claims during the policy period, in accordance with the notice provisions of the policy. Given the complexity of R&W insurance claims and the potential for coverage disputes, we strongly recommend that Ardent consult with Calderwood & Harkness before making any notification to the carrier or taking any other action that could affect coverage under the policy.
2.6 Transition Services Agreement Wind-Down
Under the Transition Services Agreement (the "TSA"), executed on June 30, 2024, CPI is providing transitional back-office, information technology, and administrative services to the Purchaser for a period of up to nine (9) months following the Closing Date, i.e., through March 30, 2025. The services covered by the TSA include, among others, accounts payable and receivable processing, payroll administration, information technology infrastructure and support, human resources administration, and certain regulatory reporting functions.
The TSA contemplates that the Purchaser will assume responsibility for each service function on a rolling basis as the Purchaser develops internal capabilities or engages third-party providers. The Purchaser is required to provide CPI with advance written notice of the termination of each service category, in accordance with the notice periods specified in the applicable service schedule.
We recommend that Ardent begin planning for the internalization or replacement of these services at the earliest practicable date. A prolonged reliance on CPI for transitional services creates operational risk and may complicate the post-closing relationship between the parties. In particular, Ardent should prioritize the transition of IT systems and data migration, given the sensitivity of patient health information and the associated regulatory requirements.
In connection with the TSA, a HIPAA Business Associate Agreement has been executed by the parties to address the handling of protected health information during the transition period. The requirements and compliance obligations under the Business Associate Agreement are discussed in detail in the Healthcare Regulatory Compliance Memorandum dated March 20, 2024, a copy of which is included in the closing binder. Ardent should ensure strict compliance with all HIPAA and HITECH Act requirements throughout the TSA period and beyond.
2.7 Employment and Non-Competition Agreements
The continued involvement of the two key executives of the Acquired Business is integral to the earnout mechanism, operational continuity, and the overall investment thesis. The following employment and restrictive covenant arrangements were executed at closing:
Dr. Randall J. Whitfield:
• Employment Agreement: Dr. Whitfield has been engaged as Chief Executive Officer of the Acquired Business under an Employment Agreement with a three-year term commencing June 30, 2024 and expiring June 30, 2027.
• Non-Competition and Non-Solicitation Agreement: Dr. Whitfield has entered into a Non-Competition and Non-Solicitation Agreement with a three-year restrictive covenant period, covering the states of Tennessee, Georgia, North Carolina, South Carolina, Alabama, Virginia, and Kentucky. The agreement restricts Dr. Whitfield from engaging in, or providing services to, any competing healthcare services business within the specified geographic area, and from soliciting employees, customers, or referral sources of the Acquired Business, for a period of three years from the Closing Date.
• Both agreements are governed by Tennessee law.
Elaine Whitfield-Torres:
• Employment Agreement: Whitfield-Torres has been engaged as Chief Commercial Officer of the Acquired Business under an Employment Agreement with a three-year term commencing June 30, 2024 and expiring June 30, 2027.
• Non-Competition and Non-Solicitation Agreement: Whitfield-Torres has entered into a Non-Competition and Non-Solicitation Agreement with a three-year restrictive covenant period, covering the same seven-state geographic area. The terms and scope of the restrictions are substantially identical to those applicable to Dr. Whitfield.
• Both agreements are governed by Tennessee law.
As noted above, the continued involvement of Dr. Whitfield and Whitfield-Torres is closely tied to the earnout structure. Any material changes to their employment status — including termination, resignation, or a change in responsibilities — could have significant implications for the earnout calculation and should be carefully considered and discussed with legal counsel.
2.8 Excluded Liabilities — Dawson Litigation Monitoring
The pending putative class action, Dawson v. Cardinal Peak Industries, Inc., Case No. 3:23-cv-01847 (United States District Court, Middle District of Tennessee), alleging violations of the Fair Labor Standards Act ("FLSA") in connection with CPI's wage-and-hour practices, is an Excluded Liability under the APA. The complaint alleges that CPI misclassified certain clinical support staff as exempt employees and failed to pay overtime compensation in accordance with the FLSA. CPI's outside counsel has estimated the potential exposure in this matter at between $2.8 million and $5.1 million, depending on the outcome of class certification and the scope of opt-in plaintiffs.
CPI (the Seller) retains all responsibility for the defense and resolution of this litigation and has provided a specific indemnification obligation to the Purchaser with respect to any Losses arising therefrom. The Purchaser has no obligation to defend or participate in the Dawson litigation, although the parties have agreed to cooperate reasonably with respect to the production of documents and access to personnel as may be required.
Notwithstanding the excluded-liability treatment, we recommend that Ardent monitor the progress of this litigation on an ongoing basis, given the operational overlap between CPI's former operations and the Acquired Business. In particular, Ardent should be attentive to any rulings on class certification, any expansion of the scope of claims, and any settlement discussions that could have implications for the Acquired Business. Calderwood & Harkness or Barrow, Kensington & Pratt LLP (which represents CPI in the Dawson matter) can provide periodic updates as appropriate.
2.9 intellectual Property — Corporate Name License-Back
Under the intellectual Property Assignment Agreement executed at closing, substantially all of CPI's intellectual property was assigned to the Purchaser, including the PeakConnect patient-engagement software platform and the associated registered trademark (United States Patent and Trademark Office Registration No. 5,412,887). In consideration of CPI's ongoing corporate needs during the wind-down period, CPI has been granted a twelve-month license-back of the "Cardinal Peak Industries" corporate name, expiring on June 30, 2025. The license is limited, non-exclusive, and revocable in accordance with the terms of the IP Assignment Agreement.
We recommend the following actions in connection with the intellectual property matters:
(a) Trademark Assignment Recordation. Ardent should confirm that the assignment of the PeakConnect trademark (U.S. Reg. No. 5,412,887) is timely recorded with the USPTO. Recording the assignment provides constructive notice to third parties and is a prerequisite to certain enforcement actions. We can assist with this filing if requested.
(b) Corporate Name License Monitoring. Ardent should calendar the expiration of the corporate name license-back on June 30, 2025, and ensure that CPI ceases all use of the "Cardinal Peak Industries" name upon expiration.
(c) Domain Name and Digital Asset Transfers. To the extent not already completed, Ardent should confirm that all domain names, social media accounts, and other digital assets associated with the PeakConnect platform and the Acquired Business have been transferred to the Purchaser's control.
2.10 Healthcare Regulatory Filings and Ongoing Compliance
Given the regulated nature of the Acquired Business, ongoing compliance with applicable healthcare laws and regulations is of critical importance. The following matters warrant continued attention:
Change-of-Ownership Filings. Change-of-ownership notices were filed with the applicable state regulatory agencies in Tennessee, Georgia, and North Carolina on March 4, 2024, well in advance of the Closing Date. Similar filings were completed for South Carolina, Alabama, Virginia, and Kentucky on the applicable timelines. The status of all such filings should be monitored to ensure that final approvals and updated licenses are received from each state.
Medicare/Medicaid Enrollment. Medicare and Medicaid enrollment updates and provider agreement transfers are in process and should be monitored in close coordination with Hargrove, Sinclair & Demarest LLP (Angela Demarest, Partner, Healthcare Regulatory). The timely completion of these transfers is essential to ensure uninterrupted reimbursement from federal and state healthcare programs. Any gap in enrollment could result in a loss of revenue and potential compliance exposure.
Anti-Kickback Statute and Stark Law Compliance. The ongoing compliance of the Acquired Business with the federal Anti-Kickback Statute (42 U.S.C. § 1320a-7b(b)) and the Physician Self-Referral Law (Stark Law) (42 U.S.C. § 1395nn) was analyzed in detail in the joint Healthcare Regulatory Compliance Memorandum dated March 20, 2024, prepared by Calderwood & Harkness and Hargrove, Sinclair & Demarest LLP. The recommendations set forth in that memorandum, including the implementation of certain compliance program enhancements and the restructuring of certain physician compensation arrangements, should be implemented promptly by the operating management of the Acquired Business.
2.11 Lease Matters
The Acquired Business operates 37 clinic locations across seven states under triple-net leases. The geographic distribution of these clinic locations is as follows: Tennessee (14 locations), Georgia (8 locations), North Carolina (5 locations), South Carolina (4 locations), Alabama (3 locations), Virginia (2 locations), and Kentucky (1 location).
Of the 37 leases, 29 leases contained provisions requiring landlord consent in connection with the asset purchase. Substantially all of the required landlord consents were obtained prior to or at the time of closing. To the extent that any landlord consents remain outstanding, they should be tracked to completion as expeditiously as possible. An outstanding landlord consent may, depending on the terms of the applicable lease, give the landlord the right to terminate the lease or to assert a default, and timely resolution is therefore important.
Tiffany Rosenthal (Calderwood & Harkness, Real Estate Group) has maintained a detailed Lease Consent Tracker throughout the transaction, and this tracker is available for reference. We recommend that the Ardent operations team obtain a current copy of the tracker and follow up directly with any landlords from whom consents remain outstanding.
2.12 Tax — Purchase Price Allocation (IRS Form 8594)
A draft IRS Form 8594 (Asset Acquisition Statement Under Section 1060 of the Internal Revenue Code) has been prepared by Sylvia Hartwell (Calderwood & Harkness, Tax Group), allocating the $620,000,000 Base Purchase Price among the seven asset classes specified in the Treasury Regulations. The allocation reflects the agreed-upon fair market values of the acquired assets, including tangible personal property, real property interests, intangible assets (including goodwill and going-concern value), and the PeakConnect intellectual property.
The Form 8594 should be finalized following the completion of the NWC true-up (deadline: September 28, 2024), as any adjustment to the purchase price resulting from the NWC true-up will affect the total consideration to be allocated. The finalized Form 8594 must be filed by both the Purchaser and CPI with their respective federal income tax returns for the taxable year that includes the Closing Date.
In addition, any earnout payments made under the Earnout Agreement will be treated as adjustments to the purchase price allocation and will require the filing of supplemental or amended Forms 8594 in the years in which such payments are made. The methodology for allocating earnout payments among the asset classes is addressed in the Section 338 / Asset Allocation Memorandum dated March 18, 2024, prepared by Sylvia Hartwell.
3. Summary Calendar of Key Post-Closing Dates
For ease of reference, the following table summarizes the key post-closing dates and obligations arising from the transaction:
We recommend that these dates be entered into Ardent's internal compliance calendar and that responsibility for monitoring each obligation be assigned to a specific member of the Ardent team. Missed deadlines — particularly with respect to indemnification claim assertion and the NWC true-up — can result in the permanent loss of contractual rights.
4. Document Retention Recommendations
Calderwood & Harkness will maintain the complete closing set and all transaction documents in our files in accordance with the firm's document retention policies. However, we strongly recommend that Ardent Capital Management LLC and Ardent Capital Partners III LP maintain their own independent copies of all material transaction documents. We recommend that the following documents be retained in perpetuity or, at minimum, through the expiration of all survival, earnout, indemnification, and applicable statute-of-limitations periods:
(a) Executed Asset Purchase Agreement and all exhibits, schedules, and amendments thereto, including the Disclosure Schedules;
(b) All ancillary agreements, including the Bill of Sale, Assignment and Assumption Agreement, intellectual Property Assignment Agreement, Transition Services Agreement, Earnout Agreement, and Escrow Agreement;
(c) Employment Agreements and Non-Competition and Non-Solicitation Agreements for Dr. Randall J. Whitfield and Elaine Whitfield-Torres;
(d) All closing certificates, officer's certificates, and secretary's certificates delivered at closing;
(e) Financing documents, including the Credit Agreement with Pinnacle National Bank, N.A., the commitment letter, the security agreement, and all related loan documents;
(f) Funds Flow Memorandum and the Closing Statement;
(g) Representations and warranties insurance policy (Policy No. SSI-RWI-2024-05178) and all related correspondence, including the underwriting submission, broker materials, and policy endorsements;
(h) All due diligence reports, memoranda, and third-party diligence materials, including the Quality of Earnings report and the environmental site assessments;
(i) Tax memoranda, including the Tax Structure Memorandum dated February 8, 2024, the Section 338 / Asset Allocation Memorandum dated March 18, 2024, and the draft IRS Form 8594;
(j) Healthcare regulatory filings and correspondence, including change-of-ownership applications, state licensing documents, and the Healthcare Regulatory Compliance Memorandum dated March 20, 2024;
(k) Payoff letter from Velthorn Merchant Bank, N.A. and UCC-3 termination statement confirmations from the Delaware and Tennessee Secretaries of State;
(l) FIRPTA Certificate executed by CPI; and
(m) All board resolutions, consents, and organizational documents of both the Purchaser and CPI.
Records relating to the earnout should be maintained through at least June 30, 2026 (the end of Earnout Period 2), plus any applicable dispute resolution period that may extend beyond that date. Records relating to indemnification claims and the R&W insurance policy should be maintained through at least June 30, 2027 (the expiration of the Fundamental Representations survival period), and potentially longer with respect to Tax Representations and any pending claims. In general, we advise erring on the side of retention rather than destruction, particularly with respect to documents that may be relevant to any potential disputes or regulatory inquiries.
5. Continuing Availability of Counsel
Calderwood & Harkness remains available to assist Ardent Capital with all post-closing matters arising from the transaction. Our ongoing representation encompasses, without limitation, the following areas:
• NWC dispute resolution, including engagement with the independent accounting firm if necessary;
• Earnout calculation review, including analysis of Adjusted EBITDA determinations and dispute resolution under the Earnout Agreement;
• Escrow release procedures, including review of claim notices and coordination with Commonwealth Trust & Escrow Company;
• Indemnification claims, including the identification, investigation, and assertion of claims against CPI under Article IX of the APA;
• R&W insurance claims, including notification to Sentinel Specialty Insurance Company and management of the claims process;
• Transition Services Agreement issues, including dispute resolution and service termination matters;
• Healthcare regulatory compliance, including coordination with Hargrove, Sinclair & Demarest LLP on ongoing licensing, enrollment, and compliance matters;
• Tax filings and related matters, including finalization of IRS Form 8594 and coordination with Sylvia Hartwell and Ashford & Creighton LLP (Gregory Nolan); and
• General post-closing advisory matters, including lease consent follow-up, intellectual property recordation, and corporate governance matters for the Purchaser.
Matter No. 2024-M&A-0142 remains open for all post-closing matters. The primary contacts for post-closing matters are:
• Beatrice Holloway, Partner (Responsible Partner) — (212) 555-7812 / bholloway@calderwoodharkness.com
• Derek Okonkwo, Associate (Lead Associate) — (212) 555-7834 / dokonkwo@calderwoodharkness.com
Please do not hesitate to reach out to either Beatrice or Derek with any questions or matters requiring attention.
In closing, we wish to express our sincere appreciation for the opportunity to represent Ardent Capital Partners III LP and Ardent Capital Management LLC in this significant transaction. The acquisition of CPI represents a meaningful addition to the Fund's healthcare portfolio, and we were privileged to serve as your counsel throughout the process. We would be remiss if we did not acknowledge the exceptional contributions of the full deal team, whose collaborative efforts were essential to the successful closing: Connor Briggs, who served as Ardent's day-to-day deal lead with extraordinary dedication and precision; Nathaniel Prescott and his team at Graystone Partners LLC, who provided invaluable financial advisory services; Gregory Nolan and his colleagues at Ashford & Creighton LLP, who managed the financial due diligence and transaction advisory workstreams; and Angela Demarest at Hargrove, Sinclair & Demarest LLP, who navigated the complex healthcare regulatory landscape with skill and thoroughness.
We look forward to continuing to work with the Ardent team on the post-closing matters described in this letter and on future transactions.
With warm regards,
CALDERWOOD & HARKNESS LLP
By: ________
Beatrice Holloway Partner One World Financial Center 200 Liberty Street, 40th Floor New York, NY 10281 Telephone: (212) 555-7812
Email: bholloway@calderwoodharkness.com
cc:
Connor Briggs, Vice President, Ardent Capital Management LLC James Prentice, Partner, Calderwood & Harkness LLP Derek Okonkwo, Associate, Calderwood & Harkness LLP Sylvia Hartwell, Partner (Tax), Calderwood & Harkness LLP
Enclosures:
Enclosed via secure file transfer link (to be provided under separate cover): Complete Closing Binder, including index of all executed transaction documents, ancillary agreements, closing certificates, financing documents, and related materials. A USB drive containing the complete closing binder will also be delivered by hand to the offices of Ardent Capital Management LLC at 590 Madison Avenue, 34th Floor, New York, NY 10022 on or before July 10, 2024.
Date | Obligation / Event
September 28, 2024 | Deadline for final NWC determination (90 days post-closing)
March 30, 2025 | Expiration of Transition Services Agreement (9 months post-closing)
June 30, 2025 | Escrow Tranche 1 release ($31,000,000); Earnout Period 1 ends; CPI corporate name license-back expires
December 30, 2025 | Escrow Tranche 2 (final) release ($31,000,000); General Representations and Warranties survival period expiration
June 30, 2026 | Earnout Period 2 ends
June 30, 2027 | Fundamental Representations survival period expiration; Employment Agreement and Non-Competition Agreement terms expire for Dr. Whitfield and Whitfield-Torres

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