Contract analysis

Section 1: Introduction and Transaction Overview 1.1 Purpose This Closing Funds Flow Memorandum (this "Memorandum") sets forth the sources and uses of funds, the funds flow sequence, and the wire transfer instructions for the closing (the "Closing") of the acquisition of Pennfield Holdings, Inc. ("Pennfield" or the "Company"), a Delaware corporation whose common stock is listed on the Nasdaq Global Select Market unde

Section 2: Sources of Funds 2.1 Summary Sources Table The following table summarizes the sources of funds to be utilized to consummate the Merger and pay related transaction costs: Note on Equity Sub-Total: The total equity contribution is $340,000,000, consisting of: (i) $258,500,000 of HPE Fund IV direct equity (net of co-invest and rollover amounts); (ii) $60,000,000 of Ashford Growth Partners LP co-investor equit

Section 3: Uses of Funds 3.1 Summary Uses Table The following table summarizes the uses to which the sources of funds described in Section 2 will be applied at Closing: Reconciliation Note: Total cash sources equal $920,000,000 ($490,000,000 Term Loan B draw + $258,500,000 HPE Fund IV equity + $60,000,000 Ashford co-invest + $90,000,000 Pennfield cash on balance sheet + $21,500,000 non-cash management rollover). Incl

Section 4: Funds Flow Sequence 4.1 Pre-Closing Steps (T-1 Business Day and Earlier) The following pre-closing steps are to be completed on or before the business day immediately preceding the anticipated Closing Date (i.e., on or before June 27, 2025, if the Closing occurs on June 30, 2025): Step 1 — Final Wire Amount Confirmation. Calderwood & Harkness LLP will circulate the Closing Confirmation, setting forth the f

Section 5: Wire Transfer Instructions The following wire transfer instructions are provided for each funding source and each payee in connection with the Closing. Wire instructions marked "To be confirmed" will be populated upon receipt of confirmed banking details from each applicable party and will be included in the final version of this Memorandum to be circulated with the Closing Confirmation. All wires are to b

Section 6: Reconciliation of Sources and Uses 6.1 Sources Reconciliation Table The following table reconciles the sources of funds available for the Closing: Note on Transaction Cost Funding: Approximately $60,000,000 of estimated transaction costs are funded from the Term Loan B proceeds and the equity contributions described above. The Term Loan B draw amount of $490,000,000 and the equity contributions of $318,500

Section 7: Key Assumptions and Qualifications This Memorandum has been prepared based on the following key assumptions and qualifications, each of which should be carefully reviewed by all recipients:

1. Estimated Amounts. All amounts set forth in this Memorandum are estimates as of the date hereof and are subject to final closing adjustments. Final confirmed amounts will be set forth in the Closing Confirmation to be circulated no later than one (1) business day prior to the Closing Date. In the event of any discrepancy between this Memorandum and the Closing Confirmation, the Closing Confirmation shall control.

2. Management Rollover. The management rollover of $21,500,000 is a non-cash transaction. The rollover participants (Catherine Langford, Derek Simmons, and Maxwell Dunn) will contribute equity (in the form of Rollover Shares) to the Surviving Corporation (or a designated holding vehicle) in lieu of receiving cash merger consideration, pursuant to the Rollover Agreement dated April 7, 2025. No cash wire is required fo

3. Pennfield Cash on Balance Sheet. The estimated cash on the Pennfield balance sheet of $90,000,000 is based on management's current estimate and is subject to final confirmation by Derek Simmons, Chief Financial Officer of Pennfield, and Pemberton & Associates LLP, Pennfield's independent auditor (lead audit partner: Kevin Tarrant Corporation), no later than two (2) business days prior to the Closing Date. Any mate

4. Transaction Costs. The estimated transaction costs of approximately $60,000,000 are based on preliminary estimates from the various service providers engaged in connection with the Merger. Final transaction cost amounts depend on actual invoices received from legal counsel, financial advisors, financing sources, insurance carriers, regulatory agencies, and other service providers. All service providers are request

5. Revolving Credit Facility. The Senior Secured Revolving Credit Facility of $150,000,000 is expected to remain undrawn at Closing. The revolving credit facility will be available for post-Closing working capital needs and general corporate purposes of the Surviving Corporation, subject to the conditions precedent and covenants set forth in the definitive credit agreement. If any portion of the revolving credit faci

6. Wire Instructions. Wire instructions marked "To be confirmed" in Section 5 of this Memorandum will be populated upon receipt of confirmed banking details from each applicable payee. Each party providing wire instructions is requested to submit such instructions, on the party's letterhead and signed by an authorized representative, to Megan Chu at Calderwood & Harkness LLP no later than five (5) business days prior

7. Immediately Available Funds. All wires are to be sent in immediately available U.S. dollar funds. Parties initiating wires should ensure that their banking institutions process wires via the Fedwire system to ensure same-day settlement. Any wires sent via other means (e.g., ACH) may not be received in time for the Closing and are not acceptable.

8. Governing Documents. This Memorandum should be read in conjunction with the following governing documents, copies of which have been made available to the parties: (a) Agreement and Plan of Merger, dated as of April 7, 2025, among Harrowgate Private Equity Fund IV LP, Pinnacle Merger Sub, Inc., and Pennfield Holdings, Inc.; (b) Equity Commitment Letter, dated March 27, 2025, from Harrowgate Private Equity Fund IV

9. No Legal Advice. This Memorandum is prepared solely for the purpose of coordinating the funds flow at Closing and does not constitute legal advice to any party other than Calderwood & Harkness LLP's clients. Each party should consult its own legal, tax, and financial advisors with respect to its obligations and the transactions contemplated hereby.

Section 8: Contact Information for Funds Flow Coordination The following contact information is provided for all key parties involved in the coordination of the Closing funds flow. All parties should direct any questions or issues regarding wire instructions, funding timing, or closing logistics to the Calderwood & Harkness LLP contacts listed below. Note: Contact information marked "To be confirmed" will be populate

Section 9: Exhibits and Appendices The following exhibits and appendices are incorporated by reference into this Memorandum and will be circulated to all parties on the Distribution List: Exhibit A — Detailed Sources and Uses Table Cross-reference to the companion Closing Funds Flow — Sources & Uses Spreadsheet (filename: funds-flow-spreadsheet.xlsx), Tab 1: Sources and Tab 2: Uses. The spreadsheet contains a detaile