Contract analysis

Section 1.1 — Defined Terms As used in this Agreement, the following terms shall have the following meanings: "Authorized Representative" means, with respect to each party, those individuals designated in Section 2.4 hereof (or any replacement designated in accordance with Section 2.4) who are authorized to give or receive notices, instructions, and directions to or from the Escrow Agent on behalf of such party. "Bus

Section 1.2 — Merger Agreement Definitions Capitalized terms used but not otherwise defined herein shall have the respective meanings ascribed to such terms in the Merger Agreement. Without limiting the generality of the foregoing, the terms "Superior Proposal," "Company Board Recommendation Change," "Termination," "Effective Time," and "Company Stockholder Approval" shall have the meanings ascribed to such terms in

Section 1.3 — Construction Unless the context of this Agreement otherwise requires: (a) words of any gender include each other gender; (b) words using the singular or plural number also include the plural or singular number, respectively; (c) references to "hereof," "herein," "hereby," and "hereunder" refer to this Agreement as a whole; (d) references to any Section, Article, Exhibit, or Schedule refer to such Sectio

ARTICLE II — ESTABLISHMENT OF ESCROW

Section 2.1 — Deposit of Escrow Amount (a) On or before the date hereof, the Company shall deposit, or cause to be deposited, the sum of Thirty-Four Million Three Hundred Thousand Dollars ($34,300,000) in immediately available funds (the "Escrow Amount") by wire transfer to the Escrow Account established by the Escrow Agent at Grandview Trust Company, N.A. in accordance with the wire transfer instructions set forth i

Section 2.2 — Escrow Account (a) The Escrow Agent shall hold the Escrow Amount, together with all investment earnings, interest, income, and proceeds thereon (collectively, the "Escrow Property"), in a segregated, interest-bearing escrow account at Grandview Trust Company, N.A. (the "Escrow Account"), separate and apart from the Escrow Agent's own assets and all other funds held by the Escrow Agent for any other pers

Section 2.3 — Investment of Escrow Funds (a) The Escrow Agent shall invest and reinvest the Escrow Property in Permitted Investments as directed by Joint Written Instructions delivered to the Escrow Agent from time to time. In the absence of Joint Written Instructions directing specific investments, the Escrow Agent shall invest the Escrow Property in one or more money market funds consisting primarily of direct obli

Section 2.4 — Authorized Representatives (a) The following individuals are hereby designated as Authorized Representatives of the Company for all purposes under this Agreement: (i) Patricia Okafor, General Counsel & Corporate Secretary Pennfield Holdings, Inc. 4500 Commerce Boulevard, Suite 800 Charlotte, NC 28202 Email: pokafor@pennfieldholdings.com Telephone: (704) 555-3200 (ii) Derek Simmons, Chief Financial Offic

ARTICLE III — RELEASE AND DISTRIBUTION OF ESCROW PROPERTY

Section 3.1 — Release to Parent (Termination Fee Payable) (a) The Escrow Agent shall release all or a portion of the Escrow Property to Parent upon receipt by the Escrow Agent of either: (i) Joint Written Instructions from the Company and Parent directing the Escrow Agent to release all or a specified portion of the Escrow Property to Parent; or (ii) A written notice from an Authorized Representative of Parent (a "Pa

Section 3.2 — Release to Company (Merger Consummated or Agreement Terminated Without Fee) (a) The Escrow Agent shall release all or a portion of the Escrow Property to the Company upon receipt by the Escrow Agent of either: (i) Joint Written Instructions from the Company and Parent directing the Escrow Agent to release all or a specified portion of the Escrow Property to the Company; or (ii) A written notice from an

Section 3.3 — Partial Releases (a) Joint Written Instructions delivered to the Escrow Agent may direct the partial release of the Escrow Property to either the Company or Parent, in such amounts and upon such terms as the Company and Parent may mutually agree. The Escrow Agent shall disburse such partial amounts as directed in such Joint Written Instructions within two (2) Business Days following receipt thereof. (b)

Section 3.4 — Disputes (a) In the event of a dispute between the Company and Parent regarding the release or disbursement of the Escrow Property (i.e., in the event a timely Dispute Notice is delivered to the Escrow Agent pursuant to Section 3.1(d) or Section 3.2(d)), the Escrow Agent shall hold the Escrow Property in the Escrow Account and shall not release any portion thereof until it has received: (i) Joint Writte

Section 3.5 — Manner of Disbursement (a) All releases and disbursements of the Escrow Property pursuant to this Article III shall be made by wire transfer of immediately available funds to the account(s) designated in writing by the receiving party. (b) The wire transfer instructions for Parent are set forth in Exhibit B attached hereto. Parent may update or change its wire transfer instructions by written notice fro

Section 4.1 — Tax Reporting (a) The parties hereto agree that, for United States federal and applicable state and local income tax purposes, all investment income, interest, earnings, and other income on the Escrow Property (collectively, "Escrow Income") shall be treated as income of the Company (as depositor of the Escrow Amount) unless and until the Escrow Property (or any portion thereof) is released or distribut

Section 4.2 — Withholding (a) The Escrow Agent shall be entitled to deduct and withhold from any distribution of the Escrow Property such amounts as may be required to be deducted or withheld under the Internal Revenue Code of 1986, as amended, or any provision of applicable federal, state, local, or foreign tax law. To the extent that amounts are so withheld and paid over to the appropriate taxing authority, such wi

Section 4.3 — Tax Indemnity The Company and Parent shall jointly and severally indemnify and hold harmless the Escrow Agent from and against any and all taxes, penalties, interest, additions to tax, and related costs and expenses (including reasonable attorneys' fees) assessed against or imposed upon the Escrow Agent by any taxing authority arising from or related to the Escrow Agent's good-faith compliance with this

Section 5.1 — Duties and Obligations (a) The Escrow Agent's duties and obligations under this Agreement are purely ministerial and administrative in nature. The Escrow Agent undertakes to perform only such duties as are expressly set forth in this Agreement and shall not be bound by the provisions of any other agreement, including the Merger Agreement, except to the extent that any provision of the Merger Agreement i

Section 5.2 — Reliance (a) The Escrow Agent shall be entitled to rely, and shall be fully protected in acting or refraining from acting, upon any written notice, instruction, certificate, statement, request, consent, agreement, or other document or instrument believed by it in good faith to be genuine and to have been signed, executed, or presented by the proper person or persons. The Escrow Agent shall not be requir

Section 5.3 — Limitation of Liability (a) The Escrow Agent shall not be liable for any action taken or omitted to be taken by it in good faith and in the absence of gross negligence, willful misconduct, or fraud on the part of the Escrow Agent. In no event shall the Escrow Agent be liable for acting in accordance with, or relying upon, any Joint Written Instructions, notice, certificate, or other document that the Es

Section 5.4 — Indemnification of Escrow Agent (a) The Company and Parent shall jointly and severally indemnify, defend, and hold harmless the Escrow Agent and its officers, directors, employees, agents, successors, and assigns (each, an "Indemnified Party") from and against any and all losses, liabilities, claims, actions, suits, proceedings, demands, damages, judgments, costs, and expenses (including reasonable atto

Section 5.5 — Compensation and Expenses (a) The Company shall pay the Escrow Agent's fees for its services hereunder in accordance with the fee schedule set forth in Schedule 1 (Fee Schedule) attached hereto and made a part hereof. Unless otherwise agreed in writing, such fees shall be payable within thirty (30) days following the date of the Escrow Agent's invoice therefor. (b) Reasonable and documented out-of-pocke

Section 5.6 — Resignation and Removal (a) The Escrow Agent may resign and be discharged from its duties hereunder at any time by giving not less than thirty (30) days' prior written notice of such resignation to the Company and Parent. Such resignation shall be effective upon the appointment of a successor escrow agent and the transfer of the Escrow Property to such successor, or upon the expiration of such thirty (3

Section 5.7 — No Implied Duties (a) The Escrow Agent shall have no implied duties, obligations, or responsibilities under this Agreement, including any fiduciary duty to any party hereto or to any other person. The duties and obligations of the Escrow Agent are limited solely to those expressly set forth in this Agreement, and no implied covenants, functions, responsibilities, duties, obligations, or liabilities shal

ARTICLE VI — REPRESENTATIONS AND WARRANTIES

Section 6.1 — Representations and Warranties of the Company The Company hereby represents and warrants to each of Parent and the Escrow Agent as follows: (a) Organization and Good Standing. Pennfield Holdings, Inc. is a corporation duly organized, validly existing, and in good standing under the laws of the State of Delaware. (b) Authority. The Company has full corporate power and authority to execute and deliver thi

Section 6.2 — Representations and Warranties of Parent Parent hereby represents and warrants to each of the Company and the Escrow Agent as follows: (a) Organization and Good Standing. Harrowgate Private Equity Fund IV LP is a limited partnership duly organized, validly existing, and in good standing under the laws of the State of Delaware. (b) Authority. Parent has full limited partnership power and authority to exe

Section 6.3 — Representations and Warranties of the Escrow Agent The Escrow Agent hereby represents and warrants to each of the Company and Parent as follows: (a) Organization and Good Standing. Grandview Trust Company, N.A. is a national banking association duly organized, validly existing, and in good standing under the laws of the United States of America. (b) Authority. The Escrow Agent has full power and authori

ARTICLE VII — GENERAL PROVISIONS

Section 7.1 — Notices All notices, instructions, requests, consents, demands, and other communications required or permitted to be given under this Agreement shall be in writing and shall be delivered by (a) personal delivery (including delivery by nationally recognized overnight courier service such as Severin Partners LLC, Halcyon Partners LLC, or Tarrant & Co.), or (b) email (with confirmation of receipt from the

Section 7.2 — Governing Law This Agreement shall be governed by, and construed and enforced in accordance with, the laws of the State of Delaware, without giving effect to any choice or conflict of law provision or rule (whether of the State of Delaware or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of Delaware.

Section 7.3 — Jurisdiction and Venue (a) Each of the parties hereto irrevocably and unconditionally submits to the exclusive jurisdiction of the Court of Chancery of the State of Delaware (or, if and only if the Court of Chancery of the State of Delaware declines to accept jurisdiction over a particular matter, any federal court of the United States of America sitting in the State of Delaware, and, if no federal cour

Section 7.4 — Waiver of Jury Trial EACH PARTY HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO A TRIAL BY JURY IN RESPECT OF ANY ACTION, SUIT, OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY. EACH PARTY CERTIFIES AND ACKNOWLEDGES THAT (A) NO REPRESENTATIVE OF ANY OTHER PARTY HAS REPRESENTED,

Section 7.5 — Entire Agreement This Agreement, together with the Exhibits and Schedules attached hereto and the Merger Agreement (solely to the extent referenced herein), constitutes the entire agreement among the parties hereto with respect to the subject matter hereof, namely the escrow of the Termination Fee, and supersedes all prior agreements, negotiations, discussions, representations, warranties, commitments,

Section 7.6 — Amendments and Waivers (a) This Agreement may be amended, modified, or supplemented only by a written instrument duly executed by each of the Company, Parent, and the Escrow Agent. No amendment, modification, or supplement shall be effective unless it is in writing and signed by all three parties hereto. (b) No waiver of any provision of this Agreement shall be effective unless it is in writing and sign

Section 7.7 — Successors and Assigns (a) This Agreement shall be binding upon and shall inure to the benefit of the parties hereto and their respective successors and permitted assigns. (b) No party may assign its rights or delegate its obligations under this Agreement without the prior written consent of each of the other parties hereto; provided, however, that Parent may assign its rights (but not its obligations)

Section 7.8 — Severability If any provision of this Agreement (or any portion thereof) shall be held by a court of competent jurisdiction to be invalid, illegal, or unenforceable, the validity, legality, and enforceability of the remaining provisions of this Agreement shall not in any way be affected or impaired thereby, and the parties shall use commercially reasonable efforts to agree upon a valid and enforceable p

Section 7.9 — Counterparts This Agreement may be executed in one or more counterparts, each of which shall be deemed an original and all of which, taken together, shall constitute one and the same instrument. Delivery of an executed counterpart of a signature page to this Agreement by facsimile, portable document format (PDF), or other electronic means (including any electronic signature complying with the U.S. feder

Section 7.10 — Third-Party Beneficiaries (a) Nothing in this Agreement, express or implied, is intended to or shall confer upon any person other than the parties hereto any rights, benefits, or remedies of any nature whatsoever under or by reason of this Agreement. Without limiting the foregoing, Merger Sub is not a party to this Agreement and shall have no rights or obligations hereunder. (b) The provisions of Secti

Section 7.11 — Termination of Escrow This Agreement shall terminate upon the final release or disbursement of all Escrow Property held in the Escrow Account in accordance with Article III hereof, and the Escrow Agent shall have no further duties, obligations, or liabilities hereunder following such final release or disbursement; provided, however, that the following provisions shall survive the termination of this Ag