1003-00003 · Harrowgate Private Equity Fund IV LP · Transaction Documents/Merger Agreement

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DISCLOSURE SCHEDULES

HARROWGATE PRIVATE EQUITY FUND IV LP

AND

HARROWGATE VELOCITY MERGER SUB INC.

Delivered Pursuant to the Agreement and Plan of Merger dated as of March 18, 2025

Among

Harrowgate Private Equity Fund IV LP a Delaware limited partnership ("Buyer" or "HPE Fund IV")

Harrowgate Velocity Merger Sub Inc. a Delaware corporation ("Merger Sub")

and

VeloPay Systems, Inc. a Delaware corporation (the "Company")

March 18, 2025

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PREAMBLE AND GENERAL QUALIFICATIONS

These Disclosure Schedules (the "Buyer Disclosure Schedules") are delivered by Harrowgate Private Equity Fund IV LP, a Delaware limited partnership ("Buyer" or "HPE Fund IV"), and Harrowgate Velocity Merger Sub Inc., a Delaware corporation and wholly-owned subsidiary of Buyer ("Merger Sub"), in connection with, and pursuant to, that certain Agreement and Plan of Merger, dated as of March 18, 2025 (the "Merger Agreement"), among Buyer, Merger Sub, and VeloPay Systems, Inc., a Delaware corporation (the "Company"). Capitalized terms used but not defined in these Buyer Disclosure Schedules shall have the meanings ascribed to such terms in the Merger Agreement.

These Buyer Disclosure Schedules are subject to the following general qualifications and limitations, each of which shall apply to every schedule herein regardless of whether a specific schedule cross-references these general qualifications:

1. Cross-References and Cross-Applicability. The section numbers in these Buyer Disclosure Schedules correspond to the section numbers of the representations and warranties of Buyer and Merger Sub set forth in Article IV of the Merger Agreement. Any information disclosed in any section or subsection of these Buyer Disclosure Schedules shall be deemed disclosed with respect to, and shall be deemed to apply to and qualify, any other section or subsection of the Merger Agreement to which the relevance of such information is reasonably apparent on its face, notwithstanding the absence of a specific cross-reference in the applicable section or subsection of these Buyer Disclosure Schedules. The mere listing of an item or matter in a particular schedule does not imply that such item or matter must be listed in any other schedule, and the fact that a particular item or matter is not cross-referenced to another schedule shall not be deemed to imply that such item or matter is not applicable to or does not qualify the representations and warranties set forth in such other section of the Merger Agreement.

2. No Admission of Materiality or Liability. The inclusion of any item or information in these Buyer Disclosure Schedules shall not be deemed to be an admission or acknowledgment that such item or information is required to be disclosed hereunder, that such item or information is material to Buyer or Merger Sub, or that such item or information has had, or would reasonably be expected to have, individually or in the aggregate, a material adverse effect on the ability of Buyer or Merger Sub to consummate the transactions contemplated by the Merger Agreement. The inclusion of information in these Buyer Disclosure Schedules shall not be deemed to establish a standard of materiality for purposes of the Merger Agreement or otherwise.

3. Summaries of Agreements and Documents. These Buyer Disclosure Schedules include brief descriptions or summaries of certain agreements, documents, instruments, and other items. Such descriptions or summaries are qualified in their entirety by reference to the full text of such agreements, documents, instruments, and items, and all such descriptions and summaries are intended merely to provide notice of the existence and general nature of the applicable items, and no representation or warranty is made that such descriptions or summaries are complete or accurate in all respects. To the extent that any description or summary contained herein is inconsistent with the actual terms of the agreement, document, or instrument being summarized, the actual terms of such agreement, document, or instrument shall control.

4. Headings. Headings in these Buyer Disclosure Schedules are for convenience of reference only and shall not affect the meaning or interpretation of any provision of these Buyer Disclosure Schedules or the Merger Agreement.

5. No Expansion of Scope. The information contained herein is disclosed solely for purposes of the Merger Agreement and shall not be deemed to constitute an expansion of the scope, or an amendment or modification, of any representation or warranty of Buyer or Merger Sub in the Merger Agreement. Nothing in these Buyer Disclosure Schedules is intended to broaden the scope of any representation, warranty, covenant, or agreement of Buyer or Merger Sub contained in the Merger Agreement.

6. Knowledge Qualification. Where any disclosure herein is qualified by the phrase "to the knowledge of Buyer" or similar language, such phrase shall have the meaning ascribed to it in the Merger Agreement.

7. Currency. All dollar amounts referenced in these Buyer Disclosure Schedules are in United States Dollars unless otherwise expressly noted.

SCHEDULE 4.1

Organization, Good Standing, and Qualification

The following information is provided with respect to the organization, good standing, and qualification of Buyer and Merger Sub:

A. Buyer — Harrowgate Private Equity Fund IV LP

Buyer was formed as a Delaware limited partnership pursuant to a Certificate of Limited Partnership filed with the Delaware Secretary of State and is governed by its Amended and Restated Agreement of Limited Partnership. Harrowgate Capital Management IV LLC, a Delaware limited liability company, serves as the sole general partner of Buyer and has full power and authority to act on behalf of Buyer in connection with the transactions contemplated by the Merger Agreement.

B. Merger Sub — Harrowgate Velocity Merger Sub Inc.

Merger Sub was incorporated on February 24, 2025, under the General Corporation Law of the State of Delaware and was formed solely for the purpose of effectuating the reverse triangular merger contemplated by the Merger Agreement. Since its date of incorporation, Merger Sub has not engaged in any business activities other than those incident to its formation, the negotiation and execution of the Merger Agreement, and the consummation of the transactions contemplated thereby. Merger Sub has no employees, no material assets (other than the nominal capital contributed upon its formation), and no operations. A copy of the Certificate of Incorporation of Merger Sub, as filed with the Delaware Secretary of State on February 24, 2025, has been delivered to the Company.

C. Foreign Qualifications

Neither Buyer nor Merger Sub is qualified to do business as a foreign entity in any jurisdiction other than the State of Delaware. Neither Buyer nor Merger Sub believes that any such foreign qualification is required in connection with the execution, delivery, or performance of the Merger Agreement or the consummation of the transactions contemplated thereby, other than any qualification that may be required as a result of the nature of the Company's business or the ownership of the Surviving Corporation following the closing, which qualifications, if any, will be obtained following the Effective Time.

SCHEDULE 4.2

Authority; No Conflict; Required Filings and Consents

A. Authority (Section 4.2(a))

No exceptions to disclose. Buyer and Merger Sub each have full corporate or partnership power and authority, as applicable, to execute and deliver the Merger Agreement and each of the other transaction documents to which they are or will be a party, and to consummate the transactions contemplated thereby, including the Merger.

The general partner of Buyer, Harrowgate Capital Management IV LLC, has approved the execution, delivery, and performance of the Merger Agreement and the consummation of the Merger and the other transactions contemplated thereby on behalf of Buyer by written consent dated March 17, 2025. Such written consent constitutes the requisite partnership action under Buyer's Amended and Restated Agreement of Limited Partnership, and no additional vote, consent, or approval of the limited partners of Buyer is required in connection with the transactions contemplated by the Merger Agreement.

The sole director of Merger Sub and the sole stockholder of Merger Sub (HPE Fund IV) have each approved the execution, delivery, and performance of the Merger Agreement and the consummation of the Merger and the other transactions contemplated thereby by written consent resolutions dated March 17, 2025. Such written consent resolutions constitute the requisite corporate action under Merger Sub's Certificate of Incorporation, Bylaws, and the DGCL, and no additional vote, consent, or approval of the stockholders or directors of Merger Sub is required in connection with the transactions contemplated by the Merger Agreement.

B. No Conflict (Section 4.2(b))

The execution, delivery, and performance of the Merger Agreement and the consummation of the transactions contemplated thereby do not and will not (i) conflict with or result in a breach of or default under any provision of the organizational documents (including the Certificate of Limited Partnership and the Amended and Restated Agreement of Limited Partnership of Buyer or the Certificate of Incorporation and Bylaws of Merger Sub), (ii) violate any Law applicable to Buyer or Merger Sub, or (iii) conflict with, result in a breach of, constitute a default under, result in the acceleration of, create in any party the right to accelerate, terminate, modify, or cancel, or require any notice under any contract, agreement, or instrument to which Buyer or Merger Sub is a party or by which either is bound or to which any of their respective properties or assets is subject, except, in the case of clauses (ii) and (iii), for any such conflicts, breaches, defaults, accelerations, rights, or failures to give notice that would not, individually or in the aggregate, reasonably be expected to prevent, materially delay, or materially impair the ability of Buyer or Merger Sub to consummate the transactions contemplated by the Merger Agreement.

The following required notice or consent items are disclosed for completeness:

1. Equity Commitment Letter. The Equity Commitment Letter, dated February 14, 2025, executed by Harrowgate Capital Management IV LLC on behalf of Harrowgate Private Equity Fund IV LP, requires the equity contribution of $1,140,000,000 to be funded on the Closing Date. No additional consent or approval is required beyond the authorization already obtained by Harrowgate Capital Management IV LLC as general partner of HPE Fund IV in connection with the execution and delivery of the Equity Commitment Letter and the Merger Agreement. The obligation to fund the equity commitment is subject to the terms and conditions set forth in the Equity Commitment Letter, including the satisfaction or waiver of the conditions to closing set forth in Article VII of the Merger Agreement.

2. Debt Commitment Letter. The Debt Commitment Letter, dated February 14, 2025 (Reference: CRE-2025-SPF-0441), from Tralvendo National Bank and Prairie State Bank, N.A., requires the satisfaction of customary conditions precedent to borrowing as set forth therein, including, without limitation, the execution and delivery of definitive credit documentation, the accuracy of specified representations and warranties, and the absence of a material adverse effect on the Company. No conflict arises from the Merger Agreement itself; however, the funding obligations under the Debt Commitment Letter are subject to the terms and conditions of the Debt Commitment Letter and the definitive credit documentation to be negotiated and executed prior to or concurrently with the closing. Buyer does not believe that any condition to the funding of the debt financing set forth in the Debt Commitment Letter will fail to be satisfied at or prior to the Closing Date.

C. Required Filings and Consents (Section 4.2(c))

The following governmental filings, registrations, notices, permits, authorizations, consents, and approvals are required to be obtained or made by Buyer or Merger Sub in connection with the execution, delivery, and performance of the Merger Agreement and the consummation of the transactions contemplated thereby:

1. Delaware Certificate of Merger. Filing of the Certificate of Merger with the Secretary of State of the State of Delaware in accordance with Section 251 of the DGCL, to be filed at or immediately prior to the Closing.

2. Hart-Scott-Rodino Antitrust Improvements Act of 1976. Premerger notification filing under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the "HSR Act"), and the rules and regulations promulgated thereunder, with the Federal Trade Commission and the Antitrust Division of the United States Department of Justice. Buyer's HSR filing form was assigned HSR Transaction Number 25-0198374 and was filed on April 2, 2025. The applicable waiting period under the HSR Act is expected to expire or be terminated in due course prior to the anticipated Closing Date.

3. Investment Canada Act. Notification filing under the Investment Canada Act (Canada) with the Minister of Innovation, Science and Economic Development Canada (through the Investment Review Division) in connection with the indirect acquisition of VeloPay Canada Inc., a wholly-owned subsidiary of the Company organized under the Canada Business Corporations Act. The notification was filed on May 1, 2025 and was cleared on June 3, 2025. No further action is required under the Investment Canada Act with respect to the transactions contemplated by the Merger Agreement.

4. State Money Transmitter Regulatory Approvals. Change-of-control notifications and applications for approval with the applicable state financial regulatory authorities in the following thirty-one (31) states and territories in which the Company or its subsidiaries hold money transmitter licenses or similar authorizations:

Alabama, Arizona, Arkansas, California, Colorado, Connecticut, Florida, Georgia, Idaho, Illinois, Indiana, Iowa, Kansas, Louisiana, Maryland, Massachusetts, Michigan, Minnesota, Missouri, Nevada, New Jersey, New York, North Carolina, Ohio, Oregon, Pennsylvania, Rhode Island, Tennessee, Texas, Virginia, and Washington.

Such filings are expected to be made during the interim period between signing and closing of the Merger. Buyer and Merger Sub will cooperate with the Company in preparing and filing such applications and will use reasonable best efforts to obtain all required approvals as promptly as practicable. Certain of such filings may require submission of personal background information, fingerprint cards, and financial statements of the principals of Buyer and its general partner, which materials are being prepared for submission.

5. State Securities and Blue Sky Laws. Such other filings and notices as may be required under applicable state securities or "blue sky" laws in connection with the transactions contemplated by the Merger Agreement, which filings, if any, are expected to be ministerial in nature.

SCHEDULE 4.3

Capitalization of Merger Sub

The following information is provided with respect to the capitalization of Merger Sub:

All 100 issued and outstanding shares of common stock of Merger Sub are validly issued, fully paid, and nonassessable, and were issued in compliance with all applicable federal and state securities laws. All such shares are owned of record and beneficially by Harrowgate Private Equity Fund IV LP, free and clear of all Liens (other than restrictions on transfer under applicable securities laws and the Merger Agreement).

No other equity interests, shares, stock, units, membership interests, partnership interests, options, warrants, convertible securities, exchangeable securities, or other rights to acquire or receive equity interests of Merger Sub are authorized, issued, reserved for issuance, or outstanding. There are no preemptive rights, subscription rights, anti-dilution rights, rights of first refusal, rights of first offer, co-sale rights, drag-along rights, tag-along rights, or similar rights with respect to the capital stock or other equity interests of Merger Sub.

Merger Sub has no subsidiaries and does not hold, directly or indirectly, any equity interest, investment, or ownership stake in any other Person (whether in the form of capital stock, partnership interests, membership interests, joint venture interests, or otherwise).

There are no outstanding obligations of Merger Sub to repurchase, redeem, or otherwise acquire any shares of its capital stock or any other equity interests. There are no stockholder agreements, voting agreements, voting trusts, proxies, registration rights agreements, or similar agreements or arrangements to which Merger Sub is a party or by which it is bound with respect to its capital stock, other than the Merger Agreement.

SCHEDULE 4.4

Buyer's and Merger Sub's Operations

A. Merger Sub Operations

Merger Sub was incorporated on February 24, 2025, in the State of Delaware and has not conducted any business, operations, or activities other than those related to its incorporation, the negotiation and execution of the Merger Agreement, and the transactions contemplated thereby. Since the date of its incorporation, Merger Sub:

(a) has no employees and has not entered into any employment, consulting, or independent contractor agreements;

(b) has no assets other than the nominal capital ($1.00) contributed by Buyer upon its formation and the rights of Merger Sub under the Merger Agreement and the other transaction documents to which it is a party;

(c) has not incurred any liabilities or obligations other than (i) those arising under or in connection with the Merger Agreement and the transactions contemplated thereby, (ii) de minimis formation and organizational costs (including filing fees, franchise tax deposits, and registered agent fees), and (iii) professional fees payable to Buyer's legal counsel in connection with the formation of Merger Sub and the negotiation and execution of the Merger Agreement;

(d) has not declared or paid any dividends or made any distributions with respect to its capital stock;

(e) has not issued, sold, pledged, or otherwise disposed of or encumbered any shares of its capital stock or other equity interests;

(f) has not entered into any contract, agreement, or commitment other than the Merger Agreement and the other transaction documents contemplated thereby; and

(g) has not conducted any business or engaged in any activities of any nature other than those described above and those contemplated by the Merger Agreement.

B. Buyer Operations

HPE Fund IV is a Delaware limited partnership with a fund size of approximately $6.8 billion (2022 vintage year) that pursues growth equity and buyout investments in the financial services technology, infrastructure software, and data analytics sectors. HPE Fund IV is managed by its general partner, Harrowgate Capital Management IV LLC, and its affiliated investment adviser, Harrowgate Capital Advisors LLC, a Delaware limited liability company registered as an investment adviser under the Investment Advisers Act of 1940.

HPE Fund IV has made three prior platform investments in the payments and financial infrastructure sectors, specifically:

(i) ClearPath Payment Technologies, Inc. (acquired October 2023; payments processing infrastructure);

(ii) Helios Treasury Solutions LLC (acquired March 2024; corporate treasury management software); and

(iii) Brightline Compliance Systems, Inc. (acquired September 2024; regulatory compliance automation for financial institutions).

These prior investments are disclosed solely for informational purposes and do not, in and of themselves, create any conflict with or impediment to the consummation of the transactions contemplated by the Merger Agreement.

SCHEDULE 4.5

Financing

A. Equity Financing

Buyer has received, and hereby discloses the existence and material terms of, the following equity financing commitment:

Equity Commitment Letter

The Equity Commitment Letter is in full force and effect as of the date hereof and has not been amended, supplemented, modified, or waived in any respect. Neither Buyer nor any of its affiliates has taken or agreed to take any action that would result in the termination, amendment, modification, or waiver of, or in any way impair or adversely affect the availability of, the equity financing contemplated by the Equity Commitment Letter. A true, correct, and complete copy of the Equity Commitment Letter (redacted only as to fee and economic terms not relevant to the commitment to fund the equity contribution) has been provided to the Company.

B. Debt Financing

Buyer has received, and hereby discloses the existence and material terms of, the following debt financing commitment:

Debt Commitment Letter

The Debt Commitment Letter provides commitments for the following credit facilities:

The Senior Secured Revolving Credit Facility is expected to be partially drawn at the Closing in the estimated amount of $254,700,000 to fund a portion of the aggregate merger consideration and transaction expenses. The remaining availability under the revolving credit facility will be available for working capital and general corporate purposes of the Surviving Corporation and its subsidiaries following the Closing.

The Debt Commitment Letter is in full force and effect as of the date hereof and has not been amended, supplemented, modified, or waived in any respect. Neither Buyer nor any of its affiliates has taken or agreed to take any action that would result in the termination, amendment, modification, or waiver of, or in any way impair or adversely affect the availability of, the debt financing contemplated by the Debt Commitment Letter. A true, correct, and complete copy of the Debt Commitment Letter (redacted only as to fee letters and fee-related terms) has been provided to the Company.

Fee Letter

In connection with the Debt Commitment Letter, Buyer has entered into a Fee Letter, dated February 14, 2025, among Buyer, Tralvendo National Bank, and Prairie State Bank, N.A., relating to arrangement fees, upfront fees, commitment fees, and other compensation payable to the lenders and arrangers in connection with the credit facilities contemplated by the Debt Commitment Letter. The Fee Letter does not contain any condition to the funding of the debt financing that is not set forth in, or contemplated by, the Debt Commitment Letter. The terms and conditions of the Fee Letter are confidential to the parties thereto. Buyer confirms that the fees and other amounts payable under the Fee Letter are included within the estimated transaction expenses set forth in the Sources and Uses summary below.

Financing Counsel to the Lenders

Maplewood & Strauss LLP, One International Place, Suite 3600, Boston, Massachusetts 02110 (lead partner: Gordon Strauss), has been engaged by Tralvendo National Bank and Prairie State Bank, N.A. as financing counsel in connection with the negotiation and documentation of the definitive credit agreements and related loan documents.

C. Sources and Uses Summary

The following summary sets forth the anticipated sources and uses of funds in connection with the consummation of the transactions contemplated by the Merger Agreement:

Sources of Funds

Uses of Funds

Note regarding refinancing of existing indebtedness: VeloPay Systems, Inc. has an existing senior secured term loan in the outstanding principal amount of approximately $112,000,000, held by Meridian Commercial Credit Corp. (599 Lexington Avenue, 26th Floor, New York, New York 10022; contact: Brian Castellano, Managing Director, Leveraged Finance). This existing term loan will be refinanced into, and repaid in full (including any accrued and unpaid interest, prepayment premiums, and breakage costs) from, the proceeds of the new $500,000,000 Senior Secured Term Loan Facility at or immediately prior to the Closing. The refinancing of such existing indebtedness is reflected in the term loan proceeds set forth in the Sources table above and is not separately broken out as a distinct Use.

D. No Side Agreements

Except for (i) the Equity Commitment Letter, (ii) the Debt Commitment Letter, (iii) the Fee Letter, and (iv) the Merger Agreement and the other transaction documents contemplated thereby (including the Limited Guarantee, the Stockholder Support Agreement, and the Rollover Agreement), there are no side letters, understandings, or other contracts, agreements, or arrangements, whether written or oral, to which Buyer, Merger Sub, or any of their respective affiliates is a party related to the financing of the transactions contemplated by the Merger Agreement. Without limiting the generality of the foregoing, there are no agreements or arrangements under which the terms or availability of the equity financing or debt financing are, or may be, subject to the discretion of any Person other than as expressly set forth in the Equity Commitment Letter, the Debt Commitment Letter, and the Fee Letter.

SCHEDULE 4.6

Litigation

No actions, suits, proceedings, claims, arbitrations, mediations, governmental investigations, or inquiries of any nature (whether civil, criminal, administrative, regulatory, or otherwise) are pending or, to the knowledge of Buyer, threatened in writing against Buyer, Merger Sub, or any of their respective officers, directors, managers, general partners, or principals that would, individually or in the aggregate, reasonably be expected to (a) prevent, materially delay, or materially impair the ability of Buyer or Merger Sub to consummate the transactions contemplated by the Merger Agreement, (b) result in any material liability to Buyer or Merger Sub in connection with the transactions contemplated by the Merger Agreement, or (c) challenge the validity or enforceability of the Merger Agreement or any of the other transaction documents.

None.

SCHEDULE 4.7

Brokers and Finders

Buyer has engaged the following financial advisor in connection with the transactions contemplated by the Merger Agreement:

The advisory fee payable to Pendleton Hawkes & Co. is included within the estimated transaction expenses set forth in Schedule 4.5 (Financing — Sources and Uses Summary) and will be paid by Buyer out of Buyer's own resources. The advisory fee is payable solely upon the successful consummation of the Merger and is not payable if the Merger Agreement is terminated without the Closing having occurred.

Except for the engagement of Pendleton Hawkes & Co. as described above, neither Buyer nor Merger Sub has employed any broker, finder, investment banker, financial advisor, or other intermediary, or incurred any liability for, or agreed to pay, any brokerage fees, commissions, finders' fees, financial advisory fees, or similar payments in connection with the transactions contemplated by the Merger Agreement. No Person (other than Pendleton Hawkes & Co.) has any valid claim against Buyer, Merger Sub, or the Company for any such fee or commission in connection with the transactions contemplated by the Merger Agreement based upon arrangements made by or on behalf of Buyer or Merger Sub.

SCHEDULE 4.8

Solvency

No exceptions to disclose.

Buyer confirms that, after giving effect to the transactions contemplated by the Merger Agreement, including (a) the payment of the aggregate merger consideration of $1,900,000,000 to the Company's stockholders, (b) the funding of the equity financing contemplated by the Equity Commitment Letter, (c) the funding of the debt financing contemplated by the Debt Commitment Letter, (d) the repayment and refinancing of VeloPay's existing senior secured term loan indebtedness of approximately $112,000,000 held by Meridian Commercial Credit Corp., and (e) the payment of all related transaction fees and expenses (estimated at $48,500,000 in the aggregate), the Surviving Corporation and its subsidiaries, taken as a whole on a consolidated basis, will be Solvent (as defined in Section 4.8 of the Merger Agreement). Specifically, following the Closing and after giving effect to all of the foregoing:

(i) the fair value and the fair saleable value of the assets of the Surviving Corporation and its subsidiaries, on a consolidated basis, will exceed the total amount of their liabilities (including contingent, subordinated, unmatured, and unliquidated liabilities);

(ii) the Surviving Corporation and its subsidiaries, on a consolidated basis, will be able to pay their debts and obligations as they become due in the ordinary course of business; and

(iii) the Surviving Corporation and its subsidiaries, on a consolidated basis, will have adequate capital to carry on their businesses and all businesses in which they are about to engage.

Buyer further notes that, in accordance with Section 7.2(h) of the Merger Agreement, a solvency certificate in the form attached as Exhibit E to the Merger Agreement will be delivered at the Closing by Marcus Langford, Chief Financial Officer of VeloPay Systems, Inc., confirming that, after giving effect to the Merger and the related transactions, the Surviving Corporation and its subsidiaries satisfy the solvency standards set forth in the Merger Agreement.

SCHEDULE 4.9

Ownership of Company Securities

As of the date of the Merger Agreement, neither Buyer nor Merger Sub (nor any of their respective directors, officers, managers, general partners, members, affiliates, or associates, as such terms are used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended) beneficially owns (within the meaning of Rule 13d-3 under the Exchange Act) any shares of common stock, preferred stock, or other equity interests of VeloPay Systems, Inc. The only equity securities of Merger Sub are the 100 shares of common stock held of record and beneficially by Buyer, as described in Schedule 4.3.

HPE Fund IV has not entered into any contract, arrangement, understanding, or commitment (whether written or oral, formal or informal) with any Person with respect to any securities of the Company, including any voting agreement, proxy, tender agreement, lock-up agreement, or similar agreement or arrangement, other than the following:

(i) The Merger Agreement. The Agreement and Plan of Merger, dated as of March 18, 2025, among Buyer, Merger Sub, and the Company.

(ii) The Stockholder Support Agreement. The Stockholder Support Agreement, dated as of March 18, 2025, among Buyer and the following stockholders of the Company (collectively, the "Supporting Stockholders"):

Pursuant to the Stockholder Support Agreement, each Supporting Stockholder has agreed, among other things, to (a) deliver a written consent adopting and approving the Merger Agreement and the Merger promptly following the mailing of the Information Statement in accordance with DGCL § 228(e), (b) refrain from transferring, pledging, or otherwise disposing of any of its shares of Company common stock during the term of the Stockholder Support Agreement (subject to customary exceptions), and (c) refrain from soliciting, encouraging, or participating in any alternative acquisition proposal or competing transaction.

(iii) The Rollover Agreement. The Rollover Agreement, dated as of March 18, 2025, among Buyer, Harrowgate Velocity Co-Invest LP, Nathan Aldridge, and Sonia Reyes-Watkins, pursuant to which Mr. Aldridge and Ms. Reyes-Watkins have agreed to reinvest a portion of their merger proceeds into Harrowgate Velocity Co-Invest LP, as follows:

Harrowgate Velocity Co-Invest LP is a Delaware limited partnership (EIN: 93-2748163), formed on March 14, 2025, with Harrowgate Capital Management IV LLC serving as its general partner. The registered agent of Harrowgate Velocity Co-Invest LP is Capitol Registered Agents LLC, 1209 Orange Street, Wilmington, Delaware 19801. Harrowgate Velocity Co-Invest LP was formed for the sole purpose of enabling certain members of the Company's management team and other designated persons to co-invest alongside Buyer in the equity of the post-closing holding company structure. The rollover amounts set forth above represent a portion of the merger consideration otherwise payable to Mr. Aldridge and Ms. Reyes-Watkins, respectively, which amounts will be contributed in exchange for limited partnership interests in Harrowgate Velocity Co-Invest LP at the Closing.

The total rollover amount of $23,900,000 is reflected in the aggregate equity consideration to Company stockholders set forth in Schedule 4.5 (Financing — Sources and Uses Summary) and does not reduce the aggregate merger consideration payable to Company stockholders as a whole.

SCHEDULE 4.10

No Other Representations and Warranties; Non-Reliance

Each of Buyer and Merger Sub acknowledges and agrees that, except for the representations and warranties expressly set forth in Article IV of the Merger Agreement (as qualified by these Buyer Disclosure Schedules), neither Buyer nor Merger Sub is making, and neither the Company nor any other Person should rely upon, any representation or warranty, express or implied, with respect to Buyer, Merger Sub, or any of their respective affiliates, or with respect to any other information provided or made available to the Company or any of its representatives in connection with the transactions contemplated by the Merger Agreement. Without limiting the generality of the foregoing, neither Buyer nor Merger Sub makes any representation or warranty with respect to (a) any projections, forecasts, estimates, budgets, or other forward-looking information relating to Buyer, Merger Sub, or any of their respective affiliates, or (b) any information, documents, or materials provided or made available to the Company or its representatives in any data room, management presentations, or in any other form in connection with the transactions contemplated by the Merger Agreement, except as expressly set forth in Article IV of the Merger Agreement.

No exceptions.

SCHEDULE 4.11

Guarantor

Buyer hereby discloses the following with respect to the Limited Guarantee delivered in connection with the Merger Agreement:

Limited Guarantee

The Limited Guarantee is in full force and effect as of the date hereof and has not been amended, supplemented, modified, or waived in any respect. Harrowgate Capital Management IV LLC has the financial capacity to satisfy its obligations under the Limited Guarantee in full. A true, correct, and complete copy of the Limited Guarantee (execution version) has been delivered to the Company.

SCHEDULE 4.12

Insurance (Representations and Warranties Insurance Policy)

Buyer has obtained a buyer-side representations and warranties insurance policy in connection with the transactions contemplated by the Merger Agreement. The material terms of such policy are as follows:

Representations and Warranties Insurance Policy

The disclosure of the representations and warranties insurance policy in this Schedule 4.12 is provided for informational purposes only and does not limit, modify, supersede, or otherwise affect the indemnification obligations of the Company's stockholders or any other party set forth in Article IX of the Merger Agreement. Without limiting the foregoing, Buyer confirms that:

(a) The indemnification cap under Article IX of the Merger Agreement is $228,000,000 (representing 12% of the aggregate merger consideration of $1,900,000,000), subject to the specific exceptions and carve-outs set forth in the Merger Agreement (including the absence of any cap with respect to claims based on fraud or intentional misrepresentation);

(b) The indemnification escrow amount of $133,000,000 (representing 7% of the aggregate merger consideration) will be deposited at the Closing into an escrow account established with Garrison Trust Company (Reference: GT-ESC-2025-07223), pursuant to the terms and conditions of the Escrow Agreement to be entered into at the Closing among Buyer, the Stockholder Representative, and Garrison Trust Company, as escrow agent; and

(c) The existence of the representations and warranties insurance policy does not reduce or limit the Company's stockholders' indemnification obligations under the Merger Agreement, and Buyer's right to recover under the representations and warranties insurance policy is independent of, and in addition to, Buyer's right to indemnification under Article IX of the Merger Agreement, subject to the prohibition on double recovery set forth in Section 9.6 of the Merger Agreement.

SCHEDULE 4.13

Information Supplied

Buyer and Merger Sub confirm that the information supplied by or on behalf of Buyer and Merger Sub for inclusion or incorporation by reference in the Information Statement to be prepared and mailed to the stockholders of the Company pursuant to Section 228(e) of the DGCL (the "Information Statement") did not, at the time of the mailing of the Information Statement to the Company's stockholders, and will not, at the time of the consummation of the Merger, contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading.

The Information Statement was prepared by the Company, with input from Buyer and Merger Sub, and was mailed to the stockholders of the Company on April 14, 2025, in accordance with Section 228(e) of the DGCL and the terms of the Merger Agreement.

No exceptions.

EXHIBIT A

List of Documents Delivered to Company

The following documents have been delivered to, or made available to, VeloPay Systems, Inc. in connection with these Buyer Disclosure Schedules. All documents are true, correct, and complete copies of the originals (subject to any redactions specifically noted below):

The foregoing list is provided for convenience of reference only. The inclusion or exclusion of any document from this list shall not affect the validity or enforceability of any provision of the Merger Agreement or these Buyer Disclosure Schedules. To the extent any document listed above is inconsistent with the descriptions set forth in the body of these Buyer Disclosure Schedules, the actual terms of such document shall control.

SIGNATURE PAGE TO BUYER DISCLOSURE SCHEDULES

IN WITNESS WHEREOF, each of the undersigned has caused these Buyer Disclosure Schedules to be executed as of March 18, 2025.

HARROWGATE PRIVATE EQUITY FUND IV LP

By: Harrowgate Capital Management IV LLC,

its General Partner

By: ________

Name: Priya Deshmukh

Title: Managing Partner

Date: March 18, 2025

HARROWGATE VELOCITY MERGER SUB INC.

By: ________

Name: Priya Deshmukh

Title: Sole Director and President

Date: March 18, 2025

Item	Detail
Full Legal Name	Harrowgate Private Equity Fund IV LP
Entity Type	Limited partnership
Jurisdiction of Formation	State of Delaware
Employer Identification Number (EIN)	87-4231956
Principal Place of Business	300 King Street, Suite 4200, Wilmington, Delaware 19801
General Partner	Harrowgate Capital Management IV LLC, a Delaware limited liability company (EIN: 87-4231847)
Good Standing	In good standing in the State of Delaware as of March 14, 2025, as evidenced by a certificate of good standing issued by the Delaware Secretary of State on such date (a copy of which has been delivered to the Company)
Item	Detail
Full Legal Name	Harrowgate Velocity Merger Sub Inc.
Entity Type	Corporation
Jurisdiction of Incorporation	State of Delaware
Date of Incorporation	February 24, 2025
Employer Identification Number (EIN)	93-1847265
Delaware File Number	7291034
Registered Agent	Capitol Registered Agents LLC, 1209 Orange Street, Wilmington, Delaware 19801
Good Standing	In good standing in the State of Delaware as of March 14, 2025, as evidenced by a certificate of good standing issued by the Delaware Secretary of State on such date (a copy of which has been delivered to the Company)
Item	Detail
Authorized Capital Stock	1,000 shares of common stock, par value $0.01 per share
Shares Issued and Outstanding	100 shares of common stock
Sole Record and Beneficial Holder	Harrowgate Private Equity Fund IV LP
Aggregate Capital Contribution	$1.00
Item	Detail
Date	February 14, 2025
Committing Party	Harrowgate Capital Management IV LLC, on behalf of Harrowgate Private Equity Fund IV LP

Committed Amount	$1,140,000,000
Percentage of Aggregate Deal Value	60%
Purpose	To fund a portion of the aggregate merger consideration of $1,900,000,000, together with related transaction fees and expenses
Funding Conditions	Funding is subject to (i) the satisfaction or waiver of the conditions to the obligations of Buyer and Merger Sub to consummate the Merger as set forth in Article VII of the Merger Agreement and (ii) the substantially concurrent funding of the Debt Financing
Expiration	The Equity Commitment Letter expires upon the earlier of (a) the Closing, (b) the valid termination of the Merger Agreement in accordance with its terms, and (c) September 18, 2025 (the Outside Date)
Item	Detail
Date	February 14, 2025
Reference Number	CRE-2025-SPF-0441
Lead Arranger and Administrative Agent (Term Loan)	Tralvendo National Bank, 100 Federal Street, 30th Floor, Boston, Massachusetts 02110
Co-Arranger and Administrative Agent (Revolving Facility)	Prairie State Bank, N.A., 231 South LaSalle Street, Suite 4400, Chicago, Illinois 60604
Facility	Committed Amount	Term	Interest Rate
Senior Secured Term Loan Facility	$500,000,000	7 years	SOFR + 375 basis points
Senior Secured Revolving Credit Facility	$260,000,000	5 years	SOFR + 325 basis points
Total Committed Debt Financing	$760,000,000
Source	Amount
HPE Fund IV Equity Contribution	$1,140,000,000
Senior Secured Term Loan	$500,000,000
Target Balance Sheet Cash (Estimated)	$53,800,000
Revolving Credit Facility Draw at Closing (Estimated)	$254,700,000
Total Sources	$1,948,500,000
Use	Amount
Aggregate Equity Consideration to Company Stockholders	$1,900,000,000
— Of which: Paid Directly to Company Stockholders	$1,767,000,000
— Of which: Deposited into Indemnification Escrow (Garrison Trust Company)	$133,000,000
Estimated Transaction Expenses (Buyer and Company, combined)	$48,500,000

Total Uses	$1,948,500,000
Item	Detail
Financial Advisor	Pendleton Hawkes & Co.
Address	383 Madison Avenue, 17th Floor, New York, New York 10179
Lead Managing Director	David Constantinou
Engagement	Financial advisory services in connection with the evaluation, negotiation, and consummation of the transactions contemplated by the Merger Agreement
Advisory Fee	0.35% of the aggregate deal value ($1,900,000,000), equal to $6,650,000, payable upon the Closing
Fee Payable By	Buyer
Engagement Letter Date	January 6, 2025
Stockholder	Ownership Percentage (Fully Diluted)
Ridgeline Ventures Fund III LP	22.4%
Apex Growth Partners II LP	16.8%
Broadleaf Capital Partners LP	6.1%
Nathan Aldridge (Co-Founder and CEO)	14.2%
Sonia Reyes-Watkins (Co-Founder and CTO)	9.7%
Total	69.2%
Rollover Participant	Rollover Equity Amount
Nathan Aldridge	$14,200,000
Sonia Reyes-Watkins	$9,700,000
Total Rollover Amount	$23,900,000
Item	Detail
Date	March 18, 2025
Guarantor	Harrowgate Capital Management IV LLC
Entity Type	Delaware limited liability company
EIN	87-4231847

Relationship to Buyer	Sole general partner of Harrowgate Private Equity Fund IV LP
Beneficiary	VeloPay Systems, Inc.
Guaranteed Obligations	(i) Payment of the Reverse Termination Fee of $57,000,000 (representing 3% of the aggregate merger consideration of $1,900,000,000) in the circumstances described in Section 8.3(b) of the Merger Agreement; and (ii) certain other specified obligations of Buyer under the Merger Agreement, including reimbursement of the Company's enforcement costs as set forth in Section 8.3(d) of the Merger Agreement
Maximum Aggregate Liability	$57,000,000 (plus enforcement costs as specified in the Limited Guarantee)
Expiration	The Limited Guarantee terminates upon the earliest of (a) the Closing, (b) payment by the Guarantor of the full amount of the Guaranteed Obligations, and (c) the valid termination of the Merger Agreement in circumstances in which no Reverse Termination Fee is payable
Item	Detail
Insurer	Oakbridge Omnivrel Insurance Group
Insurer Address	175 Water Street, Suite 2800, New York, New York 10038
Underwriter	Neil Carmichael, Senior Vice President
Policy Number	OFI-RW-2025-03187
Policy Limit	$190,000,000 (representing 10% of the aggregate deal value of $1,900,000,000)
Retention (Self-Insured Amount)	$19,000,000 (representing 1% of the aggregate deal value)
Allocation of Retention	The first $9,500,000 of the retention is borne by the Company's stockholders (via indemnification from the escrow fund), and the balance of $9,500,000 is borne by Buyer
Premium	$5,320,000 (representing 2.8% of the policy limit)
Premium Payable By	Buyer (50%) and the Company (50%), as provided in Section 6.15 of the Merger Agreement
R&W Insurance Application Submitted	February 21, 2025
Policy Bound	March 10, 2025
Policy Inception Date	July 22, 2025 (effective at the Closing)
Policy Term	Three (3) years from the policy inception date for general representations and warranties; six (6) years from the policy inception date for fundamental representations and tax representations
Insured	Harrowgate Private Equity Fund IV LP, Harrowgate Velocity Merger Sub Inc., the Surviving Corporation, and their respective affiliates and successors (as Named Insureds)
No.	Document	Date	Notes
1	Equity Commitment Letter (execution version)	February 14, 2025	Redacted as to fee terms and economic terms not relevant to the equity commitment
2	Debt Commitment Letter (execution version) (Reference: CRE-2025-SPF-0441)	February 14, 2025	Redacted as to fee letter terms and fee-related provisions
3	Limited Guarantee (execution version)	March 18, 2025	Unredacted
4	Stockholder Support Agreement (execution version)	March 18, 2025	Unredacted

5	Rollover Agreement (execution version)	March 18, 2025	Unredacted
6	Certificate of Incorporation of Harrowgate Velocity Merger Sub Inc.	Filed February 24, 2025 (Delaware File Number: 7291034)	Certified copy
7	Written Consent Resolutions of the Board of Directors of Merger Sub	March 17, 2025	Unredacted
8	Written Consent of Harrowgate Capital Management IV LLC, as General Partner of HPE Fund IV	March 17, 2025	Unredacted
9	Good Standing Certificate — Harrowgate Private Equity Fund IV LP (State of Delaware)	March 14, 2025	Issued by Delaware Secretary of State
10	Good Standing Certificate — Harrowgate Velocity Merger Sub Inc. (State of Delaware)	March 14, 2025	Issued by Delaware Secretary of State
11	R&W Insurance Binder / Evidence of Coverage — Oakbridge Omnivrel Insurance Group (Policy No. OFI-RW-2025-03187)	Bound March 10, 2025	Summary of material terms; full policy to be delivered at Closing

DISCLOSURE SCHEDULES
OF
HARROWGATE PRIVATE EQUITY FUND IV LP
AND
HARROWGATE VELOCITY MERGER SUB INC.
Delivered Pursuant to the Agreement and Plan of Merger dated as of March 18, 2025
Among
Harrowgate Private Equity Fund IV LP a Delaware limited partnership ("Buyer" or "HPE Fund IV")
Harrowgate Velocity Merger Sub Inc. a Delaware corporation ("Merger Sub")
and
VeloPay Systems, Inc. a Delaware corporation (the "Company")
March 18, 2025
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PREAMBLE AND GENERAL QUALIFICATIONS
These Disclosure Schedules (the "Buyer Disclosure Schedules") are delivered by Harrowgate Private Equity Fund IV LP, a Delaware limited partnership ("Buyer" or "HPE Fund IV"), and Harrowgate Velocity Merger Sub Inc., a Delaware corporation and wholly-owned subsidiary of Buyer ("Merger Sub"), in connection with, and pursuant to, that certain Agreement and Plan of Merger, dated as of March 18, 2025 (the "Merger Agreement"), among Buyer, Merger Sub, and VeloPay Systems, Inc., a Delaware corporation (the "Company"). Capitalized terms used but not defined in these Buyer Disclosure Schedules shall have the meanings ascribed to such terms in the Merger Agreement.
These Buyer Disclosure Schedules are subject to the following general qualifications and limitations, each of which shall apply to every schedule herein regardless of whether a specific schedule cross-references these general qualifications:
1.  Cross-References and Cross-Applicability. The section numbers in these Buyer Disclosure Schedules correspond to the section numbers of the representations and warranties of Buyer and Merger Sub set forth in Article IV of the Merger Agreement. Any information disclosed in any section or subsection of these Buyer Disclosure Schedules shall be deemed disclosed with respect to, and shall be deemed to apply to and qualify, any other section or subsection of the Merger Agreement to which the relevance of such information is reasonably apparent on its face, notwithstanding the absence of a specific cross-reference in the applicable section or subsection of these Buyer Disclosure Schedules. The mere listing of an item or matter in a particular schedule does not imply that such item or matter must be listed in any other schedule, and the fact that a particular item or matter is not cross-referenced to another schedule shall not be deemed to imply that such item or matter is not applicable to or does not qualify the representations and warranties set forth in such other section of the Merger Agreement.
2.  No Admission of Materiality or Liability. The inclusion of any item or information in these Buyer Disclosure Schedules shall not be deemed to be an admission or acknowledgment that such item or information is required to be disclosed hereunder, that such item or information is material to Buyer or Merger Sub, or that such item or information has had, or would reasonably be expected to have, individually or in the aggregate, a material adverse effect on the ability of Buyer or Merger Sub to consummate the transactions contemplated by the Merger Agreement. The inclusion of information in these Buyer Disclosure Schedules shall not be deemed to establish a standard of materiality for purposes of the Merger Agreement or otherwise.
3.  Summaries of Agreements and Documents. These Buyer Disclosure Schedules include brief descriptions or summaries of certain agreements, documents, instruments, and other items. Such descriptions or summaries are qualified in their entirety by reference to the full text of such agreements, documents, instruments, and items, and all such descriptions and summaries are intended merely to provide notice of the existence and general nature of the applicable items, and no representation or warranty is made that such descriptions or summaries are complete or accurate in all respects. To the extent that any description or summary contained herein is inconsistent with the actual terms of the agreement, document, or instrument being summarized, the actual terms of such agreement, document, or instrument shall control.
4.  Headings. Headings in these Buyer Disclosure Schedules are for convenience of reference only and shall not affect the meaning or interpretation of any provision of these Buyer Disclosure Schedules or the Merger Agreement.
5.  No Expansion of Scope. The information contained herein is disclosed solely for purposes of the Merger Agreement and shall not be deemed to constitute an expansion of the scope, or an amendment or modification, of any representation or warranty of Buyer or Merger Sub in the Merger Agreement. Nothing in these Buyer Disclosure Schedules is intended to broaden the scope of any representation, warranty, covenant, or agreement of Buyer or Merger Sub contained in the Merger Agreement.
6.  Knowledge Qualification. Where any disclosure herein is qualified by the phrase "to the knowledge of Buyer" or similar language, such phrase shall have the meaning ascribed to it in the Merger Agreement.
7.  Currency. All dollar amounts referenced in these Buyer Disclosure Schedules are in United States Dollars unless otherwise expressly noted.
SCHEDULE 4.1
Organization, Good Standing, and Qualification
The following information is provided with respect to the organization, good standing, and qualification of Buyer and Merger Sub:
A. Buyer — Harrowgate Private Equity Fund IV LP
Buyer was formed as a Delaware limited partnership pursuant to a Certificate of Limited Partnership filed with the Delaware Secretary of State and is governed by its Amended and Restated Agreement of Limited Partnership. Harrowgate Capital Management IV LLC, a Delaware limited liability company, serves as the sole general partner of Buyer and has full power and authority to act on behalf of Buyer in connection with the transactions contemplated by the Merger Agreement.
B. Merger Sub — Harrowgate Velocity Merger Sub Inc.
Merger Sub was incorporated on February 24, 2025, under the General Corporation Law of the State of Delaware and was formed solely for the purpose of effectuating the reverse triangular merger contemplated by the Merger Agreement. Since its date of incorporation, Merger Sub has not engaged in any business activities other than those incident to its formation, the negotiation and execution of the Merger Agreement, and the consummation of the transactions contemplated thereby. Merger Sub has no employees, no material assets (other than the nominal capital contributed upon its formation), and no operations. A copy of the Certificate of Incorporation of Merger Sub, as filed with the Delaware Secretary of State on February 24, 2025, has been delivered to the Company.
C. Foreign Qualifications
Neither Buyer nor Merger Sub is qualified to do business as a foreign entity in any jurisdiction other than the State of Delaware. Neither Buyer nor Merger Sub believes that any such foreign qualification is required in connection with the execution, delivery, or performance of the Merger Agreement or the consummation of the transactions contemplated thereby, other than any qualification that may be required as a result of the nature of the Company's business or the ownership of the Surviving Corporation following the closing, which qualifications, if any, will be obtained following the Effective Time.
SCHEDULE 4.2
Authority; No Conflict; Required Filings and Consents
A. Authority (Section 4.2(a))
No exceptions to disclose. Buyer and Merger Sub each have full corporate or partnership power and authority, as applicable, to execute and deliver the Merger Agreement and each of the other transaction documents to which they are or will be a party, and to consummate the transactions contemplated thereby, including the Merger.
The general partner of Buyer, Harrowgate Capital Management IV LLC, has approved the execution, delivery, and performance of the Merger Agreement and the consummation of the Merger and the other transactions contemplated thereby on behalf of Buyer by written consent dated March 17, 2025. Such written consent constitutes the requisite partnership action under Buyer's Amended and Restated Agreement of Limited Partnership, and no additional vote, consent, or approval of the limited partners of Buyer is required in connection with the transactions contemplated by the Merger Agreement.
The sole director of Merger Sub and the sole stockholder of Merger Sub (HPE Fund IV) have each approved the execution, delivery, and performance of the Merger Agreement and the consummation of the Merger and the other transactions contemplated thereby by written consent resolutions dated March 17, 2025. Such written consent resolutions constitute the requisite corporate action under Merger Sub's Certificate of Incorporation, Bylaws, and the DGCL, and no additional vote, consent, or approval of the stockholders or directors of Merger Sub is required in connection with the transactions contemplated by the Merger Agreement.
B. No Conflict (Section 4.2(b))
The execution, delivery, and performance of the Merger Agreement and the consummation of the transactions contemplated thereby do not and will not (i) conflict with or result in a breach of or default under any provision of the organizational documents (including the Certificate of Limited Partnership and the Amended and Restated Agreement of Limited Partnership of Buyer or the Certificate of Incorporation and Bylaws of Merger Sub), (ii) violate any Law applicable to Buyer or Merger Sub, or (iii) conflict with, result in a breach of, constitute a default under, result in the acceleration of, create in any party the right to accelerate, terminate, modify, or cancel, or require any notice under any contract, agreement, or instrument to which Buyer or Merger Sub is a party or by which either is bound or to which any of their respective properties or assets is subject, except, in the case of clauses (ii) and (iii), for any such conflicts, breaches, defaults, accelerations, rights, or failures to give notice that would not, individually or in the aggregate, reasonably be expected to prevent, materially delay, or materially impair the ability of Buyer or Merger Sub to consummate the transactions contemplated by the Merger Agreement.
The following required notice or consent items are disclosed for completeness:
1.  Equity Commitment Letter. The Equity Commitment Letter, dated February 14, 2025, executed by Harrowgate Capital Management IV LLC on behalf of Harrowgate Private Equity Fund IV LP, requires the equity contribution of $1,140,000,000 to be funded on the Closing Date. No additional consent or approval is required beyond the authorization already obtained by Harrowgate Capital Management IV LLC as general partner of HPE Fund IV in connection with the execution and delivery of the Equity Commitment Letter and the Merger Agreement. The obligation to fund the equity commitment is subject to the terms and conditions set forth in the Equity Commitment Letter, including the satisfaction or waiver of the conditions to closing set forth in Article VII of the Merger Agreement.
2.  Debt Commitment Letter. The Debt Commitment Letter, dated February 14, 2025 (Reference: CRE-2025-SPF-0441), from Tralvendo National Bank and Prairie State Bank, N.A., requires the satisfaction of customary conditions precedent to borrowing as set forth therein, including, without limitation, the execution and delivery of definitive credit documentation, the accuracy of specified representations and warranties, and the absence of a material adverse effect on the Company. No conflict arises from the Merger Agreement itself; however, the funding obligations under the Debt Commitment Letter are subject to the terms and conditions of the Debt Commitment Letter and the definitive credit documentation to be negotiated and executed prior to or concurrently with the closing. Buyer does not believe that any condition to the funding of the debt financing set forth in the Debt Commitment Letter will fail to be satisfied at or prior to the Closing Date.
C. Required Filings and Consents (Section 4.2(c))
The following governmental filings, registrations, notices, permits, authorizations, consents, and approvals are required to be obtained or made by Buyer or Merger Sub in connection with the execution, delivery, and performance of the Merger Agreement and the consummation of the transactions contemplated thereby:
1.  Delaware Certificate of Merger. Filing of the Certificate of Merger with the Secretary of State of the State of Delaware in accordance with Section 251 of the DGCL, to be filed at or immediately prior to the Closing.
2.  Hart-Scott-Rodino Antitrust Improvements Act of 1976. Premerger notification filing under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the "HSR Act"), and the rules and regulations promulgated thereunder, with the Federal Trade Commission and the Antitrust Division of the United States Department of Justice. Buyer's HSR filing form was assigned HSR Transaction Number 25-0198374 and was filed on April 2, 2025. The applicable waiting period under the HSR Act is expected to expire or be terminated in due course prior to the anticipated Closing Date.
3.  Investment Canada Act. Notification filing under the Investment Canada Act (Canada) with the Minister of Innovation, Science and Economic Development Canada (through the Investment Review Division) in connection with the indirect acquisition of VeloPay Canada Inc., a wholly-owned subsidiary of the Company organized under the Canada Business Corporations Act. The notification was filed on May 1, 2025 and was cleared on June 3, 2025. No further action is required under the Investment Canada Act with respect to the transactions contemplated by the Merger Agreement.
4.  State Money Transmitter Regulatory Approvals. Change-of-control notifications and applications for approval with the applicable state financial regulatory authorities in the following thirty-one (31) states and territories in which the Company or its subsidiaries hold money transmitter licenses or similar authorizations:
Alabama, Arizona, Arkansas, California, Colorado, Connecticut, Florida, Georgia, Idaho, Illinois, Indiana, Iowa, Kansas, Louisiana, Maryland, Massachusetts, Michigan, Minnesota, Missouri, Nevada, New Jersey, New York, North Carolina, Ohio, Oregon, Pennsylvania, Rhode Island, Tennessee, Texas, Virginia, and Washington.
Such filings are expected to be made during the interim period between signing and closing of the Merger. Buyer and Merger Sub will cooperate with the Company in preparing and filing such applications and will use reasonable best efforts to obtain all required approvals as promptly as practicable. Certain of such filings may require submission of personal background information, fingerprint cards, and financial statements of the principals of Buyer and its general partner, which materials are being prepared for submission.
5.  State Securities and Blue Sky Laws. Such other filings and notices as may be required under applicable state securities or "blue sky" laws in connection with the transactions contemplated by the Merger Agreement, which filings, if any, are expected to be ministerial in nature.
SCHEDULE 4.3
Capitalization of Merger Sub
The following information is provided with respect to the capitalization of Merger Sub:
All 100 issued and outstanding shares of common stock of Merger Sub are validly issued, fully paid, and nonassessable, and were issued in compliance with all applicable federal and state securities laws. All such shares are owned of record and beneficially by Harrowgate Private Equity Fund IV LP, free and clear of all Liens (other than restrictions on transfer under applicable securities laws and the Merger Agreement).
No other equity interests, shares, stock, units, membership interests, partnership interests, options, warrants, convertible securities, exchangeable securities, or other rights to acquire or receive equity interests of Merger Sub are authorized, issued, reserved for issuance, or outstanding. There are no preemptive rights, subscription rights, anti-dilution rights, rights of first refusal, rights of first offer, co-sale rights, drag-along rights, tag-along rights, or similar rights with respect to the capital stock or other equity interests of Merger Sub.
Merger Sub has no subsidiaries and does not hold, directly or indirectly, any equity interest, investment, or ownership stake in any other Person (whether in the form of capital stock, partnership interests, membership interests, joint venture interests, or otherwise).
There are no outstanding obligations of Merger Sub to repurchase, redeem, or otherwise acquire any shares of its capital stock or any other equity interests. There are no stockholder agreements, voting agreements, voting trusts, proxies, registration rights agreements, or similar agreements or arrangements to which Merger Sub is a party or by which it is bound with respect to its capital stock, other than the Merger Agreement.
SCHEDULE 4.4
Buyer's and Merger Sub's Operations
A. Merger Sub Operations
Merger Sub was incorporated on February 24, 2025, in the State of Delaware and has not conducted any business, operations, or activities other than those related to its incorporation, the negotiation and execution of the Merger Agreement, and the transactions contemplated thereby. Since the date of its incorporation, Merger Sub:
(a) has no employees and has not entered into any employment, consulting, or independent contractor agreements;
(b) has no assets other than the nominal capital ($1.00) contributed by Buyer upon its formation and the rights of Merger Sub under the Merger Agreement and the other transaction documents to which it is a party;
(c) has not incurred any liabilities or obligations other than (i) those arising under or in connection with the Merger Agreement and the transactions contemplated thereby, (ii) de minimis formation and organizational costs (including filing fees, franchise tax deposits, and registered agent fees), and (iii) professional fees payable to Buyer's legal counsel in connection with the formation of Merger Sub and the negotiation and execution of the Merger Agreement;
(d) has not declared or paid any dividends or made any distributions with respect to its capital stock;
(e) has not issued, sold, pledged, or otherwise disposed of or encumbered any shares of its capital stock or other equity interests;
(f) has not entered into any contract, agreement, or commitment other than the Merger Agreement and the other transaction documents contemplated thereby; and
(g) has not conducted any business or engaged in any activities of any nature other than those described above and those contemplated by the Merger Agreement.
B. Buyer Operations
HPE Fund IV is a Delaware limited partnership with a fund size of approximately $6.8 billion (2022 vintage year) that pursues growth equity and buyout investments in the financial services technology, infrastructure software, and data analytics sectors. HPE Fund IV is managed by its general partner, Harrowgate Capital Management IV LLC, and its affiliated investment adviser, Harrowgate Capital Advisors LLC, a Delaware limited liability company registered as an investment adviser under the Investment Advisers Act of 1940.
HPE Fund IV has made three prior platform investments in the payments and financial infrastructure sectors, specifically:
(i) ClearPath Payment Technologies, Inc. (acquired October 2023; payments processing infrastructure);
(ii) Helios Treasury Solutions LLC (acquired March 2024; corporate treasury management software); and
(iii) Brightline Compliance Systems, Inc. (acquired September 2024; regulatory compliance automation for financial institutions).
These prior investments are disclosed solely for informational purposes and do not, in and of themselves, create any conflict with or impediment to the consummation of the transactions contemplated by the Merger Agreement.
SCHEDULE 4.5
Financing
A. Equity Financing
Buyer has received, and hereby discloses the existence and material terms of, the following equity financing commitment:
Equity Commitment Letter
The Equity Commitment Letter is in full force and effect as of the date hereof and has not been amended, supplemented, modified, or waived in any respect. Neither Buyer nor any of its affiliates has taken or agreed to take any action that would result in the termination, amendment, modification, or waiver of, or in any way impair or adversely affect the availability of, the equity financing contemplated by the Equity Commitment Letter. A true, correct, and complete copy of the Equity Commitment Letter (redacted only as to fee and economic terms not relevant to the commitment to fund the equity contribution) has been provided to the Company.
B. Debt Financing
Buyer has received, and hereby discloses the existence and material terms of, the following debt financing commitment:
Debt Commitment Letter
The Debt Commitment Letter provides commitments for the following credit facilities:
The Senior Secured Revolving Credit Facility is expected to be partially drawn at the Closing in the estimated amount of $254,700,000 to fund a portion of the aggregate merger consideration and transaction expenses. The remaining availability under the revolving credit facility will be available for working capital and general corporate purposes of the Surviving Corporation and its subsidiaries following the Closing.
The Debt Commitment Letter is in full force and effect as of the date hereof and has not been amended, supplemented, modified, or waived in any respect. Neither Buyer nor any of its affiliates has taken or agreed to take any action that would result in the termination, amendment, modification, or waiver of, or in any way impair or adversely affect the availability of, the debt financing contemplated by the Debt Commitment Letter. A true, correct, and complete copy of the Debt Commitment Letter (redacted only as to fee letters and fee-related terms) has been provided to the Company.
Fee Letter
In connection with the Debt Commitment Letter, Buyer has entered into a Fee Letter, dated February 14, 2025, among Buyer, Tralvendo National Bank, and Prairie State Bank, N.A., relating to arrangement fees, upfront fees, commitment fees, and other compensation payable to the lenders and arrangers in connection with the credit facilities contemplated by the Debt Commitment Letter. The Fee Letter does not contain any condition to the funding of the debt financing that is not set forth in, or contemplated by, the Debt Commitment Letter. The terms and conditions of the Fee Letter are confidential to the parties thereto. Buyer confirms that the fees and other amounts payable under the Fee Letter are included within the estimated transaction expenses set forth in the Sources and Uses summary below.
Financing Counsel to the Lenders
Maplewood & Strauss LLP, One International Place, Suite 3600, Boston, Massachusetts 02110 (lead partner: Gordon Strauss), has been engaged by Tralvendo National Bank and Prairie State Bank, N.A. as financing counsel in connection with the negotiation and documentation of the definitive credit agreements and related loan documents.
C. Sources and Uses Summary
The following summary sets forth the anticipated sources and uses of funds in connection with the consummation of the transactions contemplated by the Merger Agreement:
Sources of Funds
Uses of Funds
Note regarding refinancing of existing indebtedness: VeloPay Systems, Inc. has an existing senior secured term loan in the outstanding principal amount of approximately $112,000,000, held by Meridian Commercial Credit Corp. (599 Lexington Avenue, 26th Floor, New York, New York 10022; contact: Brian Castellano, Managing Director, Leveraged Finance). This existing term loan will be refinanced into, and repaid in full (including any accrued and unpaid interest, prepayment premiums, and breakage costs) from, the proceeds of the new $500,000,000 Senior Secured Term Loan Facility at or immediately prior to the Closing. The refinancing of such existing indebtedness is reflected in the term loan proceeds set forth in the Sources table above and is not separately broken out as a distinct Use.
D. No Side Agreements
Except for (i) the Equity Commitment Letter, (ii) the Debt Commitment Letter, (iii) the Fee Letter, and (iv) the Merger Agreement and the other transaction documents contemplated thereby (including the Limited Guarantee, the Stockholder Support Agreement, and the Rollover Agreement), there are no side letters, understandings, or other contracts, agreements, or arrangements, whether written or oral, to which Buyer, Merger Sub, or any of their respective affiliates is a party related to the financing of the transactions contemplated by the Merger Agreement. Without limiting the generality of the foregoing, there are no agreements or arrangements under which the terms or availability of the equity financing or debt financing are, or may be, subject to the discretion of any Person other than as expressly set forth in the Equity Commitment Letter, the Debt Commitment Letter, and the Fee Letter.
SCHEDULE 4.6
Litigation
No actions, suits, proceedings, claims, arbitrations, mediations, governmental investigations, or inquiries of any nature (whether civil, criminal, administrative, regulatory, or otherwise) are pending or, to the knowledge of Buyer, threatened in writing against Buyer, Merger Sub, or any of their respective officers, directors, managers, general partners, or principals that would, individually or in the aggregate, reasonably be expected to (a) prevent, materially delay, or materially impair the ability of Buyer or Merger Sub to consummate the transactions contemplated by the Merger Agreement, (b) result in any material liability to Buyer or Merger Sub in connection with the transactions contemplated by the Merger Agreement, or (c) challenge the validity or enforceability of the Merger Agreement or any of the other transaction documents.
None.
SCHEDULE 4.7
Brokers and Finders
Buyer has engaged the following financial advisor in connection with the transactions contemplated by the Merger Agreement:
The advisory fee payable to Pendleton Hawkes & Co. is included within the estimated transaction expenses set forth in Schedule 4.5 (Financing — Sources and Uses Summary) and will be paid by Buyer out of Buyer's own resources. The advisory fee is payable solely upon the successful consummation of the Merger and is not payable if the Merger Agreement is terminated without the Closing having occurred.
Except for the engagement of Pendleton Hawkes & Co. as described above, neither Buyer nor Merger Sub has employed any broker, finder, investment banker, financial advisor, or other intermediary, or incurred any liability for, or agreed to pay, any brokerage fees, commissions, finders' fees, financial advisory fees, or similar payments in connection with the transactions contemplated by the Merger Agreement. No Person (other than Pendleton Hawkes & Co.) has any valid claim against Buyer, Merger Sub, or the Company for any such fee or commission in connection with the transactions contemplated by the Merger Agreement based upon arrangements made by or on behalf of Buyer or Merger Sub.
SCHEDULE 4.8
Solvency
No exceptions to disclose.
Buyer confirms that, after giving effect to the transactions contemplated by the Merger Agreement, including (a) the payment of the aggregate merger consideration of $1,900,000,000 to the Company's stockholders, (b) the funding of the equity financing contemplated by the Equity Commitment Letter, (c) the funding of the debt financing contemplated by the Debt Commitment Letter, (d) the repayment and refinancing of VeloPay's existing senior secured term loan indebtedness of approximately $112,000,000 held by Meridian Commercial Credit Corp., and (e) the payment of all related transaction fees and expenses (estimated at $48,500,000 in the aggregate), the Surviving Corporation and its subsidiaries, taken as a whole on a consolidated basis, will be Solvent (as defined in Section 4.8 of the Merger Agreement). Specifically, following the Closing and after giving effect to all of the foregoing:
(i) the fair value and the fair saleable value of the assets of the Surviving Corporation and its subsidiaries, on a consolidated basis, will exceed the total amount of their liabilities (including contingent, subordinated, unmatured, and unliquidated liabilities);
(ii) the Surviving Corporation and its subsidiaries, on a consolidated basis, will be able to pay their debts and obligations as they become due in the ordinary course of business; and
(iii) the Surviving Corporation and its subsidiaries, on a consolidated basis, will have adequate capital to carry on their businesses and all businesses in which they are about to engage.
Buyer further notes that, in accordance with Section 7.2(h) of the Merger Agreement, a solvency certificate in the form attached as Exhibit E to the Merger Agreement will be delivered at the Closing by Marcus Langford, Chief Financial Officer of VeloPay Systems, Inc., confirming that, after giving effect to the Merger and the related transactions, the Surviving Corporation and its subsidiaries satisfy the solvency standards set forth in the Merger Agreement.
SCHEDULE 4.9
Ownership of Company Securities
As of the date of the Merger Agreement, neither Buyer nor Merger Sub (nor any of their respective directors, officers, managers, general partners, members, affiliates, or associates, as such terms are used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended) beneficially owns (within the meaning of Rule 13d-3 under the Exchange Act) any shares of common stock, preferred stock, or other equity interests of VeloPay Systems, Inc. The only equity securities of Merger Sub are the 100 shares of common stock held of record and beneficially by Buyer, as described in Schedule 4.3.
HPE Fund IV has not entered into any contract, arrangement, understanding, or commitment (whether written or oral, formal or informal) with any Person with respect to any securities of the Company, including any voting agreement, proxy, tender agreement, lock-up agreement, or similar agreement or arrangement, other than the following:
(i) The Merger Agreement. The Agreement and Plan of Merger, dated as of March 18, 2025, among Buyer, Merger Sub, and the Company.
(ii) The Stockholder Support Agreement. The Stockholder Support Agreement, dated as of March 18, 2025, among Buyer and the following stockholders of the Company (collectively, the "Supporting Stockholders"):
Pursuant to the Stockholder Support Agreement, each Supporting Stockholder has agreed, among other things, to (a) deliver a written consent adopting and approving the Merger Agreement and the Merger promptly following the mailing of the Information Statement in accordance with DGCL § 228(e), (b) refrain from transferring, pledging, or otherwise disposing of any of its shares of Company common stock during the term of the Stockholder Support Agreement (subject to customary exceptions), and (c) refrain from soliciting, encouraging, or participating in any alternative acquisition proposal or competing transaction.
(iii) The Rollover Agreement. The Rollover Agreement, dated as of March 18, 2025, among Buyer, Harrowgate Velocity Co-Invest LP, Nathan Aldridge, and Sonia Reyes-Watkins, pursuant to which Mr. Aldridge and Ms. Reyes-Watkins have agreed to reinvest a portion of their merger proceeds into Harrowgate Velocity Co-Invest LP, as follows:
Harrowgate Velocity Co-Invest LP is a Delaware limited partnership (EIN: 93-2748163), formed on March 14, 2025, with Harrowgate Capital Management IV LLC serving as its general partner. The registered agent of Harrowgate Velocity Co-Invest LP is Capitol Registered Agents LLC, 1209 Orange Street, Wilmington, Delaware 19801. Harrowgate Velocity Co-Invest LP was formed for the sole purpose of enabling certain members of the Company's management team and other designated persons to co-invest alongside Buyer in the equity of the post-closing holding company structure. The rollover amounts set forth above represent a portion of the merger consideration otherwise payable to Mr. Aldridge and Ms. Reyes-Watkins, respectively, which amounts will be contributed in exchange for limited partnership interests in Harrowgate Velocity Co-Invest LP at the Closing.
The total rollover amount of $23,900,000 is reflected in the aggregate equity consideration to Company stockholders set forth in Schedule 4.5 (Financing — Sources and Uses Summary) and does not reduce the aggregate merger consideration payable to Company stockholders as a whole.
SCHEDULE 4.10
No Other Representations and Warranties; Non-Reliance
Each of Buyer and Merger Sub acknowledges and agrees that, except for the representations and warranties expressly set forth in Article IV of the Merger Agreement (as qualified by these Buyer Disclosure Schedules), neither Buyer nor Merger Sub is making, and neither the Company nor any other Person should rely upon, any representation or warranty, express or implied, with respect to Buyer, Merger Sub, or any of their respective affiliates, or with respect to any other information provided or made available to the Company or any of its representatives in connection with the transactions contemplated by the Merger Agreement. Without limiting the generality of the foregoing, neither Buyer nor Merger Sub makes any representation or warranty with respect to (a) any projections, forecasts, estimates, budgets, or other forward-looking information relating to Buyer, Merger Sub, or any of their respective affiliates, or (b) any information, documents, or materials provided or made available to the Company or its representatives in any data room, management presentations, or in any other form in connection with the transactions contemplated by the Merger Agreement, except as expressly set forth in Article IV of the Merger Agreement.
No exceptions.
SCHEDULE 4.11
Guarantor
Buyer hereby discloses the following with respect to the Limited Guarantee delivered in connection with the Merger Agreement:
Limited Guarantee
The Limited Guarantee is in full force and effect as of the date hereof and has not been amended, supplemented, modified, or waived in any respect. Harrowgate Capital Management IV LLC has the financial capacity to satisfy its obligations under the Limited Guarantee in full. A true, correct, and complete copy of the Limited Guarantee (execution version) has been delivered to the Company.
SCHEDULE 4.12
Insurance (Representations and Warranties Insurance Policy)
Buyer has obtained a buyer-side representations and warranties insurance policy in connection with the transactions contemplated by the Merger Agreement. The material terms of such policy are as follows:
Representations and Warranties Insurance Policy
The disclosure of the representations and warranties insurance policy in this Schedule 4.12 is provided for informational purposes only and does not limit, modify, supersede, or otherwise affect the indemnification obligations of the Company's stockholders or any other party set forth in Article IX of the Merger Agreement. Without limiting the foregoing, Buyer confirms that:
(a) The indemnification cap under Article IX of the Merger Agreement is $228,000,000 (representing 12% of the aggregate merger consideration of $1,900,000,000), subject to the specific exceptions and carve-outs set forth in the Merger Agreement (including the absence of any cap with respect to claims based on fraud or intentional misrepresentation);
(b) The indemnification escrow amount of $133,000,000 (representing 7% of the aggregate merger consideration) will be deposited at the Closing into an escrow account established with Garrison Trust Company (Reference: GT-ESC-2025-07223), pursuant to the terms and conditions of the Escrow Agreement to be entered into at the Closing among Buyer, the Stockholder Representative, and Garrison Trust Company, as escrow agent; and
(c) The existence of the representations and warranties insurance policy does not reduce or limit the Company's stockholders' indemnification obligations under the Merger Agreement, and Buyer's right to recover under the representations and warranties insurance policy is independent of, and in addition to, Buyer's right to indemnification under Article IX of the Merger Agreement, subject to the prohibition on double recovery set forth in Section 9.6 of the Merger Agreement.
SCHEDULE 4.13
Information Supplied
Buyer and Merger Sub confirm that the information supplied by or on behalf of Buyer and Merger Sub for inclusion or incorporation by reference in the Information Statement to be prepared and mailed to the stockholders of the Company pursuant to Section 228(e) of the DGCL (the "Information Statement") did not, at the time of the mailing of the Information Statement to the Company's stockholders, and will not, at the time of the consummation of the Merger, contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading.
The Information Statement was prepared by the Company, with input from Buyer and Merger Sub, and was mailed to the stockholders of the Company on April 14, 2025, in accordance with Section 228(e) of the DGCL and the terms of the Merger Agreement.
No exceptions.
EXHIBIT A
List of Documents Delivered to Company
The following documents have been delivered to, or made available to, VeloPay Systems, Inc. in connection with these Buyer Disclosure Schedules. All documents are true, correct, and complete copies of the originals (subject to any redactions specifically noted below):
The foregoing list is provided for convenience of reference only. The inclusion or exclusion of any document from this list shall not affect the validity or enforceability of any provision of the Merger Agreement or these Buyer Disclosure Schedules. To the extent any document listed above is inconsistent with the descriptions set forth in the body of these Buyer Disclosure Schedules, the actual terms of such document shall control.
SIGNATURE PAGE TO BUYER DISCLOSURE SCHEDULES
IN WITNESS WHEREOF, each of the undersigned has caused these Buyer Disclosure Schedules to be executed as of March 18, 2025.
HARROWGATE PRIVATE EQUITY FUND IV LP
By: Harrowgate Capital Management IV LLC,
its General Partner
By: ________
Name: Priya Deshmukh
Title: Managing Partner
Date: March 18, 2025
HARROWGATE VELOCITY MERGER SUB INC.
By: ________
Name: Priya Deshmukh
Title: Sole Director and President
Date: March 18, 2025
Item | Detail
Full Legal Name | Harrowgate Private Equity Fund IV LP
Entity Type | Limited partnership
Jurisdiction of Formation | State of Delaware
Employer Identification Number (EIN) | 87-4231956
Principal Place of Business | 300 King Street, Suite 4200, Wilmington, Delaware 19801
General Partner | Harrowgate Capital Management IV LLC, a Delaware limited liability company (EIN: 87-4231847)
Good Standing | In good standing in the State of Delaware as of March 14, 2025, as evidenced by a certificate of good standing issued by the Delaware Secretary of State on such date (a copy of which has been delivered to the Company)
Item | Detail
Full Legal Name | Harrowgate Velocity Merger Sub Inc.
Entity Type | Corporation
Jurisdiction of Incorporation | State of Delaware
Date of Incorporation | February 24, 2025
Employer Identification Number (EIN) | 93-1847265
Delaware File Number | 7291034
Registered Agent | Capitol Registered Agents LLC, 1209 Orange Street, Wilmington, Delaware 19801
Good Standing | In good standing in the State of Delaware as of March 14, 2025, as evidenced by a certificate of good standing issued by the Delaware Secretary of State on such date (a copy of which has been delivered to the Company)
Item | Detail
Authorized Capital Stock | 1,000 shares of common stock, par value $0.01 per share
Shares Issued and Outstanding | 100 shares of common stock
Sole Record and Beneficial Holder | Harrowgate Private Equity Fund IV LP
Aggregate Capital Contribution | $1.00
Item | Detail
Date | February 14, 2025
Committing Party | Harrowgate Capital Management IV LLC, on behalf of Harrowgate Private Equity Fund IV LP
Committed Amount | $1,140,000,000
Percentage of Aggregate Deal Value | 60%
Purpose | To fund a portion of the aggregate merger consideration of $1,900,000,000, together with related transaction fees and expenses
Funding Conditions | Funding is subject to (i) the satisfaction or waiver of the conditions to the obligations of Buyer and Merger Sub to consummate the Merger as set forth in Article VII of the Merger Agreement and (ii) the substantially concurrent funding of the Debt Financing
Expiration | The Equity Commitment Letter expires upon the earlier of (a) the Closing, (b) the valid termination of the Merger Agreement in accordance with its terms, and (c) September 18, 2025 (the Outside Date)
Item | Detail
Date | February 14, 2025
Reference Number | CRE-2025-SPF-0441
Lead Arranger and Administrative Agent (Term Loan) | Tralvendo National Bank, 100 Federal Street, 30th Floor, Boston, Massachusetts 02110
Co-Arranger and Administrative Agent (Revolving Facility) | Prairie State Bank, N.A., 231 South LaSalle Street, Suite 4400, Chicago, Illinois 60604
Facility | Committed Amount | Term | Interest Rate
Senior Secured Term Loan Facility | $500,000,000 | 7 years | SOFR + 375 basis points
Senior Secured Revolving Credit Facility | $260,000,000 | 5 years | SOFR + 325 basis points
Total Committed Debt Financing | $760,000,000
Source | Amount
HPE Fund IV Equity Contribution | $1,140,000,000
Senior Secured Term Loan | $500,000,000
Target Balance Sheet Cash (Estimated) | $53,800,000
Revolving Credit Facility Draw at Closing (Estimated) | $254,700,000
Total Sources | $1,948,500,000
Use | Amount
Aggregate Equity Consideration to Company Stockholders | $1,900,000,000
— Of which: Paid Directly to Company Stockholders | $1,767,000,000
— Of which: Deposited into Indemnification Escrow (Garrison Trust Company) | $133,000,000
Estimated Transaction Expenses (Buyer and Company, combined) | $48,500,000
Total Uses | $1,948,500,000
Item | Detail
Financial Advisor | Pendleton Hawkes & Co.
Address | 383 Madison Avenue, 17th Floor, New York, New York 10179
Lead Managing Director | David Constantinou
Engagement | Financial advisory services in connection with the evaluation, negotiation, and consummation of the transactions contemplated by the Merger Agreement
Advisory Fee | 0.35% of the aggregate deal value ($1,900,000,000), equal to $6,650,000, payable upon the Closing
Fee Payable By | Buyer
Engagement Letter Date | January 6, 2025
Stockholder | Ownership Percentage (Fully Diluted)
Ridgeline Ventures Fund III LP | 22.4%
Apex Growth Partners II LP | 16.8%
Broadleaf Capital Partners LP | 6.1%
Nathan Aldridge (Co-Founder and CEO) | 14.2%
Sonia Reyes-Watkins (Co-Founder and CTO) | 9.7%
Total | 69.2%
Rollover Participant | Rollover Equity Amount
Nathan Aldridge | $14,200,000
Sonia Reyes-Watkins | $9,700,000
Total Rollover Amount | $23,900,000
Item | Detail
Date | March 18, 2025
Guarantor | Harrowgate Capital Management IV LLC
Entity Type | Delaware limited liability company
EIN | 87-4231847
Relationship to Buyer | Sole general partner of Harrowgate Private Equity Fund IV LP
Beneficiary | VeloPay Systems, Inc.
Guaranteed Obligations | (i) Payment of the Reverse Termination Fee of $57,000,000 (representing 3% of the aggregate merger consideration of $1,900,000,000) in the circumstances described in Section 8.3(b) of the Merger Agreement; and (ii) certain other specified obligations of Buyer under the Merger Agreement, including reimbursement of the Company's enforcement costs as set forth in Section 8.3(d) of the Merger Agreement
Maximum Aggregate Liability | $57,000,000 (plus enforcement costs as specified in the Limited Guarantee)
Expiration | The Limited Guarantee terminates upon the earliest of (a) the Closing, (b) payment by the Guarantor of the full amount of the Guaranteed Obligations, and (c) the valid termination of the Merger Agreement in circumstances in which no Reverse Termination Fee is payable
Item | Detail
Insurer | Oakbridge Omnivrel Insurance Group
Insurer Address | 175 Water Street, Suite 2800, New York, New York 10038
Underwriter | Neil Carmichael, Senior Vice President
Policy Number | OFI-RW-2025-03187
Policy Limit | $190,000,000 (representing 10% of the aggregate deal value of $1,900,000,000)
Retention (Self-Insured Amount) | $19,000,000 (representing 1% of the aggregate deal value)
Allocation of Retention | The first $9,500,000 of the retention is borne by the Company's stockholders (via indemnification from the escrow fund), and the balance of $9,500,000 is borne by Buyer
Premium | $5,320,000 (representing 2.8% of the policy limit)
Premium Payable By | Buyer (50%) and the Company (50%), as provided in Section 6.15 of the Merger Agreement
R&W Insurance Application Submitted | February 21, 2025
Policy Bound | March 10, 2025
Policy Inception Date | July 22, 2025 (effective at the Closing)
Policy Term | Three (3) years from the policy inception date for general representations and warranties; six (6) years from the policy inception date for fundamental representations and tax representations
Insured | Harrowgate Private Equity Fund IV LP, Harrowgate Velocity Merger Sub Inc., the Surviving Corporation, and their respective affiliates and successors (as Named Insureds)
No. | Document | Date | Notes
1 | Equity Commitment Letter (execution version) | February 14, 2025 | Redacted as to fee terms and economic terms not relevant to the equity commitment
2 | Debt Commitment Letter (execution version) (Reference: CRE-2025-SPF-0441) | February 14, 2025 | Redacted as to fee letter terms and fee-related provisions
3 | Limited Guarantee (execution version) | March 18, 2025 | Unredacted
4 | Stockholder Support Agreement (execution version) | March 18, 2025 | Unredacted
5 | Rollover Agreement (execution version) | March 18, 2025 | Unredacted
6 | Certificate of Incorporation of Harrowgate Velocity Merger Sub Inc. | Filed February 24, 2025 (Delaware File Number: 7291034) | Certified copy
7 | Written Consent Resolutions of the Board of Directors of Merger Sub | March 17, 2025 | Unredacted
8 | Written Consent of Harrowgate Capital Management IV LLC, as General Partner of HPE Fund IV | March 17, 2025 | Unredacted
9 | Good Standing Certificate — Harrowgate Private Equity Fund IV LP (State of Delaware) | March 14, 2025 | Issued by Delaware Secretary of State
10 | Good Standing Certificate — Harrowgate Velocity Merger Sub Inc. (State of Delaware) | March 14, 2025 | Issued by Delaware Secretary of State
11 | R&W Insurance Binder / Evidence of Coverage — Oakbridge Omnivrel Insurance Group (Policy No. OFI-RW-2025-03187) | Bound March 10, 2025 | Summary of material terms; full policy to be delivered at Closing

DISCLOSURE SCHEDULES

HARROWGATE PRIVATE EQUITY FUND IV LP

HARROWGATE VELOCITY MERGER SUB INC.

PREAMBLE AND GENERAL QUALIFICATIONS

SCHEDULE 4.1

SCHEDULE 4.2

SCHEDULE 4.3

SCHEDULE 4.4

SCHEDULE 4.5

SCHEDULE 4.6

SCHEDULE 4.7

SCHEDULE 4.8

SCHEDULE 4.9

SCHEDULE 4.10

SCHEDULE 4.11

SCHEDULE 4.12

SCHEDULE 4.13

EXHIBIT A

SIGNATURE PAGE TO BUYER DISCLOSURE SCHEDULES

HARROWGATE PRIVATE EQUITY FUND IV LP

HARROWGATE VELOCITY MERGER SUB INC.

Record

Parties

Dates

Amounts