What I did was sprinted to the bathroom and knifed the guy quickly. I walked towards the two guys about to shoot me, staying in the middle so neither could see/shoot me. Then I went left and hit L and quickly put a few rounds into the guy at the doorway. Still walking forward, I tossed a flashbang towards the middle of the room (think right around the table/chairs in the middle) and immediately banked left before the doorway. As soon as the flashbang went off, I walked into the room and killed any guys in my way on the left side as I made my way through it.
I've noticed that if you keep moving forward and shooting the guys in your way, your team will sometimes move forward with you and kill the other guys before the flashbang wears off. It saves you time and bullets. I made sure to kill the guys just outside of the room, around the left and right corners. I got a flashbang ready and went all the way to the left, before the room with the hull breach. I tossed it somewhere towards the middle of the room, roughly to the right of the brown overturned bench-thing. Immediately, I made a beeline for that bench and went prone behind it, taking the opportunity to reload and have my squad move forward and kill almost everybody.
Made my way through the room and towards the stairs, usually having around 30 seconds left. I tossed a grenader into the room and went into the left doorway, taking out guys and hiding behind cover. If you're quick enough to have 30-35 left on the clock before this, you've got a fair amount of time to play with. Feel free to use another flashbang if needed, since there's more in the 2nd room upstairs, on the counter. I tossed a flashbang into the next room, killed whoever, tossed another, killed anyone left and ran forward. 2 final guys came around the corner, I just shot them both from the hip and continued sprinting towards the door.
I've noticed it gives you the same 4 or so seconds to shoot the guy, no matter what, even if you made it to the door with only a second or two to spare. Take your time and remember to aim down the pistol sight, you probably won't be accurate enough otherwise.
But, really, a lot of it is luck. Even with this exact strategy, I probably failed it 20 times before finally beating the level. Either the shotgun guy would nail me, or my grenade would miss one guy who would shoot me, or I'd catch a stray bullet, or my team would forget one guy who would shoot me in the back...you get the idea. But, it eventually worked for me.