[sheet: Cover & Summary]
Field | Value
Document Title | Funds Flow Memorandum — Closing
Prepared By | Calderwood & Harkness LLP
C&H Office | 101 California Street, Suite 4500, San Francisco, CA 94111
Matter Number | 1008-00008
Prepared By (Attorneys) | Naomi Petersen / Ryan Kowalski
Reviewed By | Harrison Wexford
Date of Memorandum | May 27, 2024
Closing Date | May 27, 2024
Transaction | Merger of Prismyx Data Solutions LLC with and into Prismyx Acquisition Sub LLC pursuant to Agreement and Plan of Merger dated April 3, 2024
Buyer | Lumos Analytics Inc. (EIN: 83-2941076)
Buyer Address | 450 Mission Street, Suite 2200, San Francisco, CA 94105
Merger Sub | Prismyx Acquisition Sub LLC (EIN: 93-4218560)
Target | Prismyx Data Solutions LLC (EIN: 86-1537842)
Target Address | 1414 Walnut Street, Suite 310, Philadelphia, PA 19102
Seller 1 | Jonah Eberhardt (55% — 550 of 1,000 units)
Seller 2 | Talia Messina (45% — 450 of 1,000 units)
Escrow Agent | Fenwick Escrow Services LLC
Escrow Agent Address | 3 Park Plaza, Suite 1100, Irvine, CA 92614
Escrow Officer | Dana Whitford
Source of Buyer Funds | Linden Grove National Bank
Lender Address | 555 Montgomery Street, San Francisco, CA 94111
Lender Relationship Manager | Gregory Olshan
Aggregate Deal Value | $15,000,000
Closing Cash Consideration | $10,500,000
Maximum Earnout (not funded at closing) | $4,500,000
Status | PRIVILEGED AND CONFIDENTIAL — ATTORNEY WORK PRODUCT
[sheet: Consideration Summary]
Line Item | Amount | Percentage of Deal Value | Notes
Total Aggregate Deal Value | $15,000,000 | 100% | Per Merger Agreement dated April 3, 2024
Closing Cash Consideration | $10,500,000 | 70% | $15,000,000 × 70%
Less: Indemnification Escrow Deposit | ($4,500,000) | 30% | Deposited with Fenwick Escrow Services LLC at closing; $15,000,000 × 30%
Net Cash Disbursed to Sellers at Closing | $6,000,000 | 40% | $10,500,000 – $4,500,000
Escrow Amount (held for indemnification) | $4,500,000 | 30% | Release date: November 27, 2025 (18 months post-closing), subject to reserves for pending claims
Maximum Earnout Consideration (not funded at closing) | $4,500,000 | 30% | Two tranches of $2,250,000 each; contingent on PrismLens Net New ARR milestones and continued employment
Total Maximum Consideration (Closing Cash + Max Earnout) | $15,000,000 | 100% | $10,500,000 + $4,500,000
Fenwick Escrow Administration Fee (Year 1) | $3,500 | 0.02% | Separate from deal consideration; paid by Buyer per Escrow Agreement
[sheet: Seller Allocation]
Component | Aggregate Amount | Jonah Eberhardt (55%) | Talia Messina (45%) | Notes
Closing Cash Consideration (gross) | $10,500,000 | $5,775,000 | $4,725,000 | Pro rata per ownership percentage
Less: Indemnification Escrow Deposit | ($4,500,000) | ($2,475,000) | ($2,025,000) | Held at Fenwick Escrow Services LLC
Net Cash Payable to Seller at Closing | $6,000,000 | $3,300,000 | $2,700,000 | Wire to be sent on Closing Date
Escrow Entitlement (released 11/27/2025) | $4,500,000 | $2,475,000 | $2,025,000 | Subject to indemnification claims and reserves
Maximum Earnout — Tranche 1 (Period 1: months 1–15) | $2,250,000 | $1,237,500 | $1,012,500 | Target: $2,200,000 PrismLens Net New ARR; Period ends 8/27/2025
Maximum Earnout — Tranche 2 (Period 2: months 16–30) | $2,250,000 | $1,237,500 | $1,012,500 | Target: $3,500,000 cumulative PrismLens Net New ARR; Period ends 11/27/2026
Maximum Total Earnout | $4,500,000 | $2,475,000 | $2,025,000 | Contingent; not funded at closing
Maximum Total Consideration (all sources) | $15,000,000 | $8,250,000 | $6,750,000 | Closing cash + maximum earnout
Ownership Units | 1,000 units | 550 units | 450 units | Per Operating Agreement of Prismyx Data Solutions LLC
[sheet: Funds Flow Detail]
Wire No. | Wire Reference | Description | Payor | Payee / Recipient | Amount | Source Bank / Account | Source ABA Routing No. | Source Account No. | Source Account Name | Receiving Bank | Receiving ABA Routing No. | Receiving Account No. | Receiving Account Name | Receiving Bank Address | For Further Credit To | Reference / Memo | Status
1 | LUMOS-PX-2024-001 | Indemnification Escrow Deposit | Lumos Analytics Inc. | Fenwick Escrow Services LLC — Indemnification Escrow Account | $4,500,000 | Linden Grove National Bank | 121-XXX-XXX | XXXX-XXXX-7814 | Lumos Analytics Inc. — Operating Account | Pacific Western Trust Bank | 122-XXX-XXX | XXXX-XXXX-3291 | Fenwick Escrow Services LLC — Lumos/Prismyx Indemnification Escrow | 3 Park Plaza, Suite 1100, Irvine, CA 92614 | Escrow Acct. Ref: FEN-ESC-2024-05271 | Merger Agreement dtd 4/3/2024 — Indemnification Escrow | Completed
2 | LUMOS-PX-2024-002 | Net Closing Cash — Jonah Eberhardt (55%) | Lumos Analytics Inc. | Jonah Eberhardt | $3,300,000 | Linden Grove National Bank | 121-XXX-XXX | XXXX-XXXX-7814 | Lumos Analytics Inc. — Operating Account | Larkspur Securities | 031-XXX-XXX | XXXX-XXXX-6458 | Jonah Eberhardt — Personal Account | 1500 Market Street, Philadelphia, PA 19102 | N/A | Merger Agreement dtd 4/3/2024 — Seller Closing Cash (Eberhardt) | Completed
3 | LUMOS-PX-2024-003 | Net Closing Cash — Talia Messina (45%) | Lumos Analytics Inc. | Talia Messina | $2,700,000 | Linden Grove National Bank | 121-XXX-XXX | XXXX-XXXX-7814 | Lumos Analytics Inc. — Operating Account | Commonwealth Savings Bank | 036-XXX-XXX | XXXX-XXXX-9102 | Talia Messina — Personal Account | 1818 Market Street, Philadelphia, PA 19103 | N/A | Merger Agreement dtd 4/3/2024 — Seller Closing Cash (Messina) | Completed
4 | LUMOS-PX-2024-004 | Fenwick Escrow Administration Fee — Year 1 | Lumos Analytics Inc. | Fenwick Escrow Services LLC — Operating Account | $3,500 | Linden Grove National Bank | 121-XXX-XXX | XXXX-XXXX-7814 | Lumos Analytics Inc. — Operating Account | Pacific Western Trust Bank | 122-XXX-XXX | XXXX-XXXX-5507 | Fenwick Escrow Services LLC — Operating | 3 Park Plaza, Suite 1100, Irvine, CA 92614 | N/A | Escrow Admin Fee per Escrow Agreement dtd 5/27/2024 | Completed
[sheet: Source of Funds]
Item | Detail
Source Entity | Lumos Analytics Inc.
Source Bank | Linden Grove National Bank
Bank Address | 555 Montgomery Street, San Francisco, CA 94111
Relationship Manager | Gregory Olshan
Account Name | Lumos Analytics Inc. — Operating Account
ABA Routing Number | 121-XXX-XXX
Account Number | XXXX-XXXX-7814
Account Type | Commercial Operating / DDA
Revolving Credit Facility | Revolving Credit Agreement dated September 15, 2022; $25,000,000 capacity
Bank Consent for Acquisition | Obtained April 15, 2024 (permitted acquisition notice delivered per credit agreement)
Total Funds Required at Closing | $10,503,500 ($10,500,000 closing consideration + $3,500 escrow admin fee)
Funds Availability Confirmed | Yes — confirmed by G. Olshan on May 24, 2024
[sheet: Working Capital Adjustment]
Item | Value | Notes
Target Net Working Capital | $485,000 | Per Section 2.6 of the Merger Agreement
Estimated Net Working Capital at Closing | TBD — to be determined by Haverford & Keane, CPAs | Preliminary estimate to be delivered within 5 business days post-closing
True-Up Deadline | 90 days post-closing (August 25, 2024) | Dollar-for-dollar adjustment above or below target
De Minimis Collar | $25,000 | No adjustment if variance between estimated and target NWC is ≤ $25,000
Adjustment Direction — NWC Above Target (by > $25,000) | Buyer pays excess to Sellers | Pro rata: Eberhardt 55% / Messina 45%
Adjustment Direction — NWC Below Target (by > $25,000) | Sellers pay shortfall to Buyer | Pro rata: Eberhardt 55% / Messina 45%; may be satisfied from escrow
Accounting Firm for NWC Review | Haverford & Keane, CPAs | Engagement Partner: Lorraine Chow; 2001 Market Street, Suite 600, Philadelphia, PA 19103
Note | N/A | Working capital adjustment is not funded at closing. Post-closing true-up wire (if any) will be a separate funds flow.