1005-00001 · Nexford Industrial Holdings · Closing

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BORROWER'S CERTIFICATE — PRO FORMA COMPLIANCE

(Leverage Ratios)

Delivered Pursuant to Section 4.01 of the Credit Agreement

Reference: Credit Agreement dated as of March 28, 2025 (as amended, restated, supplemented, or otherwise modified from time to time, the "Credit Agreement"), among Nexford Industrial Holdings Inc., a Delaware corporation (the "Borrower"), the Guarantors party thereto, Crescent Harbor Bank, N.A., as Administrative Agent and Collateral Agent (in such capacity, the "Administrative Agent"), Ironwood Capital Markets, LLC and Northvane Securities, Inc., as Joint Lead Arrangers and Joint Bookrunners, and the Lenders from time to time party thereto.

Certificate Date: March 28, 2025

Delivered to:

Crescent Harbor Bank, N.A. as Administrative Agent 320 Federal Street Boston, Massachusetts 02110

Attention: Agency Services — Leveraged Finance

Section 1. Recitals and Introductory Certification

This Borrower's Certificate — Pro Forma Compliance (this "Certificate") is delivered by Nexford Industrial Holdings Inc. (the "Borrower"), a corporation duly organized and existing under the laws of the State of Delaware, with its principal place of business located at 1400 Industrial Parkway, Schaumburg, Illinois 60173 (Employer Identification Number: 36-4178552), to the Administrative Agent pursuant to the Credit Agreement referenced above.

The undersigned, Michelle Kaplan, Chief Financial Officer of the Borrower, hereby certifies, solely in her capacity as an authorized officer of the Borrower and not in her individual capacity, pursuant to Section 4.01 (Conditions Precedent to the Closing Date Borrowing) of the Credit Agreement, as follows:

Capitalized terms used but not otherwise defined in this Certificate shall have the respective meanings ascribed to such terms in the Credit Agreement. In the event of any conflict between the terms used herein and the definitions set forth in the Credit Agreement, the definitions in the Credit Agreement shall control.

This Certificate is being delivered to the Administrative Agent in connection with the initial borrowing of One Billion Four Hundred Million Dollars ($1,400,000,000) in aggregate principal amount of Term B Loans (the "Term Loans") under the Credit Agreement on the Closing Date, which is March 28, 2025. The delivery of this Certificate constitutes a condition precedent to the making of the Term Loans by the Lenders on the Closing Date, as set forth in Section 4.01(j) of the Credit Agreement. The undersigned has reviewed the terms of the Credit Agreement and has made, or has caused to be made under her supervision, such examination and investigation as is necessary to enable her to express an informed opinion as to the matters set forth herein.

Section 2. Description of the Transaction

The proceeds of the Term Loans, together with existing cash on the balance sheet of the Borrower, will be applied on the Closing Date to consummate the transactions described below (collectively, the "Transactions"):

(a) Refinancing of the Existing First Lien Term Loan. The Borrower will use a portion of the Term Loan proceeds to repay in full all outstanding obligations under the existing first lien term loan facility (the "Existing Term Loan") arising under that certain Credit Agreement dated as of June 14, 2019 (as amended by the First Amendment dated December 3, 2020, the Second Amendment dated April 15, 2022, the Third Amendment dated January 27, 2023, and the Fourth Amendment dated September 12, 2024, collectively, the "Existing Credit Agreement"), among the Borrower, Atlas Meridian Bank, N.A., as administrative agent, and the lenders from time to time party thereto. The payoff amount for the Existing Term Loan is approximately $879,375,000, consisting of $875,000,000 in outstanding principal amount plus approximately $4,375,000 in accrued and unpaid interest calculated through and including the Closing Date. Upon such repayment, all commitments, obligations, and liens arising under the Existing Credit Agreement with respect to the term loan facility will be terminated and released.

(b) Termination of the Existing Revolving Credit Facility. The existing revolving credit facility under the Existing Credit Agreement, with aggregate revolving commitments of $190,000,000 (the "Existing Revolver"), has no amounts currently drawn thereunder. On the Closing Date, the revolving commitments under the Existing Revolver will be permanently reduced to zero and all commitments thereunder will be terminated in full. No amounts are payable in connection with such termination other than customary breakage, administrative, and termination fees, which are included in transaction fees and expenses described in clause (d) below.

(c) Distribution to Holdings. The Borrower will pay a distribution (the "Holdings Distribution") of approximately $335,000,000 to Granite Peak NIH Holdings, LLC, a Delaware limited liability company that is the direct parent of the Borrower and a Holdings Guarantor under the Credit Agreement (the "Holdings"), which amount will be applied by Holdings for general corporate purposes and to fund a return of capital to its equityholders.

(d) Payment of Transaction Fees and Expenses. The Borrower will use approximately $38,625,000 of the Term Loan proceeds to pay fees and expenses incurred in connection with the Transactions, consisting of the following:

(i) arrangement fees payable to the Joint Lead Arrangers: $7,000,000;

(ii) original issue discount ("OID") on the Term Loans (representing an issue price of 99.50%): $7,000,000;

(iii) legal fees and expenses of counsel to the Borrower (Davis Harmon & Blackwell LLP) and counsel to the Administrative Agent and the Joint Lead Arrangers (Whitfield Crane & Associates LLP): approximately $9,250,000;

(iv) financial advisory fees: approximately $6,500,000;

(v) rating agency fees (S&P Global Ratings and Moody's Investors Service): approximately $1,875,000;

(vi) title, lien search, and filing fees: approximately $2,500,000;

(vii) other customary closing costs, including due diligence expenses, printing costs, trustee and paying agent fees associated with the Existing Credit Agreement payoff, and administrative agent fees: approximately $5,500,000; and

(viii) aggregate transaction fees and expenses: approximately $38,625,000.

(e) Cash Retained on the Balance Sheet. The remaining proceeds of the Term Loans in the amount of approximately $147,000,000 will be retained on the balance sheet of the Borrower as unrestricted cash and cash equivalents, available for general corporate purposes.

(f) Total Sources. The total sources of funds for the Transactions are $1,400,000,000, consisting solely of the proceeds of the Term Loans under the Credit Agreement.

For the avoidance of doubt, the existing $250,000,000 aggregate principal amount of 7.250% Senior Unsecured Notes due 2028 of the Borrower (the "Senior Unsecured Notes"), issued under that certain Indenture dated as of November 8, 2021 (as supplemented from time to time, the "Notes Indenture"), between the Borrower and Pinnacle Trust Company, as trustee (the "Notes Trustee"), are not being refinanced, repurchased, redeemed, or otherwise retired in connection with the Transactions and will remain outstanding following the Closing Date. The Senior Unsecured Notes will constitute "Indebtedness" of the Borrower for all purposes under the Credit Agreement, including for purposes of the leverage ratio calculations set forth herein.

Section 3. Pro Forma Financial Data

The following pro forma financial data has been prepared by the Borrower for purposes of demonstrating compliance with the financial covenant and related conditions precedent set forth in the Credit Agreement, after giving pro forma effect to the Transactions as if they had occurred on the first day of the applicable measurement period (for income statement items) or the Closing Date (for balance sheet items).

3(a). LTM Adjusted EBITDA

The Borrower's Consolidated EBITDA (as defined in the Credit Agreement and referred to herein as "Adjusted EBITDA") for the last twelve months ended December 31, 2024 (the "LTM Period") is calculated as follows:

The Adjusted EBITDA figure set forth above is calculated in accordance with, and subject to, the definition of "Consolidated EBITDA" (or equivalent defined term) in the Credit Agreement, including all applicable limitations on the amount and type of permitted add-backs. The Borrower confirms that the total amount of cost savings, synergies, restructuring charges, and similar add-backs included in Adjusted EBITDA does not exceed the cap, if any, set forth in the Credit Agreement.

3(b). Pro Forma Indebtedness

After giving pro forma effect to the Transactions, the Borrower's consolidated indebtedness is as follows:

Pro Forma First Lien Secured Indebtedness:

Pro Forma Total Indebtedness:

For the avoidance of doubt, the existing first lien term loan under the Existing Credit Agreement ($875,000,000 in outstanding principal amount) and the existing revolving credit facility under the Existing Credit Agreement ($190,000,000 in aggregate commitments, with $0 currently drawn) will each be repaid in full and/or terminated at the closing of the Transactions. Accordingly, the obligations and commitments under the Existing Credit Agreement are excluded from the pro forma indebtedness figures set forth above. The Borrower has no other material indebtedness for borrowed money (including capital leases, purchase money obligations, or other indebtedness that would constitute "Indebtedness" as defined in the Credit Agreement) that is not reflected in the table above, other than ordinary course trade payables, accrued expenses, and immaterial subsidiary-level obligations.

3(c). Pro Forma Cash and Cash Equivalents

Cash and cash equivalents of the Borrower and its Restricted Subsidiaries on a consolidated basis, after giving pro forma effect to the Transactions, are as follows:

The pro forma cash balance of $100,000,000 is derived from (i) the Borrower's existing unrestricted cash and cash equivalents on hand immediately prior to the Closing Date, plus (ii) $147,000,000 in new cash retained on the balance sheet from the Term Loan proceeds, net of (iii) working capital adjustments, transaction-related payments (including the fees and expenses described in Section 2(d) above), the Holdings Distribution described in Section 2(c) above, and the payoff of accrued interest on the Existing Term Loan. This amount represents management's good faith estimate of the consolidated cash position of the Borrower and its Restricted Subsidiaries as of the Closing Date, after giving effect to all components of the Transactions. For purposes of the net leverage ratio calculations below, "cash and cash equivalents" includes only unrestricted cash and Permitted Investments that constitute cash equivalents under the Credit Agreement and excludes any restricted cash, compensating balances, or cash held by Unrestricted Subsidiaries, if any.

3(d). Pro Forma Net Indebtedness

Based on the foregoing, the Borrower's pro forma net indebtedness is as follows:

Section 4. Pro Forma Leverage Ratio Calculations

4(a). First Lien Net Leverage Ratio

The Borrower's pro forma First Lien Net Leverage Ratio, calculated in accordance with the Credit Agreement, is as follows:

The Pro Forma First Lien Net Leverage Ratio of approximately 3.38 to 1.00 is below the maximum First Lien Net Leverage Ratio of 5.00 to 1.00 as set forth in Section 7.11 (Financial Covenant) of the Credit Agreement. Accordingly, after giving pro forma effect to the Transactions, the Borrower is in compliance with the financial covenant set forth in the Credit Agreement with respect to the First Lien Net Leverage Ratio, with approximately 1.62 turns of headroom (representing approximately $623,500,000 of incremental first lien net indebtedness capacity at the current level of Adjusted EBITDA).

4(b). Total Net Leverage Ratio

The Borrower's pro forma Total Net Leverage Ratio, calculated in accordance with the Credit Agreement, is as follows:

The Pro Forma Total Net Leverage Ratio of approximately 4.03 to 1.00 is presented for informational purposes and demonstrates the Borrower's overall leverage position after giving pro forma effect to the Transactions. The Credit Agreement does not contain a standalone total net leverage ratio financial maintenance covenant; however, certain provisions of the Credit Agreement (including, without limitation, provisions governing restricted payments, incremental facilities, and investments) reference the Total Net Leverage Ratio as an incurrence-based test, and the Borrower's compliance at the 4.03x level is noted accordingly.

Section 5. Compliance Certification

The undersigned hereby certifies, on behalf of the Borrower, that after giving pro forma effect to the Transactions (including the incurrence of $1,400,000,000 of Term Loans under the Credit Agreement, the repayment of all outstanding obligations under the Existing Credit Agreement, the termination of all commitments under the Existing Credit Agreement, the distribution of approximately $335,000,000 to Holdings, and the payment of approximately $38,625,000 in related transaction fees and expenses):

(a) The Pro Forma First Lien Net Leverage Ratio is approximately 3.38 to 1.00, which is less than the maximum First Lien Net Leverage Ratio of 5.00 to 1.00 permitted under Section 7.11 of the Credit Agreement;

(b) The Borrower is in compliance with the financial covenant set forth in Section 7.11 of the Credit Agreement as of the Closing Date on a pro forma basis;

(c) No Default or Event of Default (each as defined in the Credit Agreement) has occurred and is continuing as of the date hereof, or would result from the consummation of the Transactions contemplated hereby, under the Credit Agreement or any other Loan Document; and

(d) Each of the representations and warranties of the Borrower and the other Loan Parties set forth in the Credit Agreement and the other Loan Documents is true and correct in all material respects (or, in the case of any representation or warranty that is qualified by materiality, Material Adverse Effect, or similar qualifier, in all respects) on and as of the date hereof, except to the extent that any such representation and warranty expressly relates to an earlier date, in which case such representation and warranty is true and correct in all material respects (or in all respects, as applicable) as of such earlier date.

Note Regarding Springing Nature of Financial Covenant. The financial covenant set forth in Section 7.11 of the Credit Agreement (requiring that the First Lien Net Leverage Ratio not exceed 5.00 to 1.00) is a springing financial maintenance covenant that is tested on a quarterly basis only when the aggregate outstanding principal amount of revolving loans (under any revolving credit facility established under the Credit Agreement or any incremental revolving facility established pursuant to Section 2.14 of the Credit Agreement, if applicable) exceeds 40% of the aggregate revolving commitments at the end of such fiscal quarter. As of the Closing Date, no revolving credit facility is being established under the Credit Agreement, and accordingly, the springing financial covenant is not currently subject to testing. However, if a revolving credit facility is subsequently added to the Credit Agreement via an incremental facility pursuant to Section 2.14, the financial covenant will apply in accordance with its terms upon the conditions for testing being satisfied. The pro forma compliance demonstrated in this Certificate is provided as a condition precedent to the initial borrowing on the Closing Date pursuant to Section 4.01(j) of the Credit Agreement, and not as evidence of compliance with the quarterly testing requirements of Section 7.11, which are not currently applicable.

Section 6. Additional Pro Forma Metrics (For Informational Purposes)

The following additional metrics are provided for informational purposes only and do not constitute certifications required under the Credit Agreement. These metrics are intended to provide the Administrative Agent and the Lenders with supplemental information regarding the Borrower's pro forma financial profile:

Based on the foregoing, the Borrower's pro forma annual cash interest expense on the Term Loans (assuming a blended all-in interest rate of approximately 8.40% per annum based on current 1-month Term SOFR of approximately 4.30%, plus the applicable credit spread adjustment of 10 basis points, plus the applicable margin of 400 basis points) is estimated at approximately $117,600,000, resulting in a pro forma fixed charge coverage ratio (calculated as LTM Adjusted EBITDA divided by estimated annual cash interest expense plus scheduled amortization) of approximately 3.18x. This ratio is provided solely for illustrative purposes and is not a defined term or tested metric under the Credit Agreement.

Section 7. Assumptions and Qualifications

The calculations and certifications set forth in this Certificate are subject to the following assumptions and qualifications:

(a) All calculations herein are made on a pro forma basis giving effect to the Transactions as if they had occurred on the first day of the LTM Period (with respect to income statement items, including Adjusted EBITDA and its components) or the Closing Date (with respect to balance sheet items, including indebtedness and cash and cash equivalents), in each case in accordance with the definitions and methodologies set forth in the Credit Agreement, including the definition of "Pro Forma Basis" (or equivalent defined term) contained therein.

(b) All financial data underlying the calculations set forth herein is derived from the Borrower's audited consolidated financial statements for the fiscal year ended December 31, 2024, as audited by Ashworth & Kendrick LLP, an independent registered public accounting firm (Helen Yamamoto, Engagement Partner), and from the Borrower's internal management accounts and records, which the undersigned believes to be accurate and complete in all material respects as of the date hereof.

(c) The Adjusted EBITDA add-backs reflected in Section 3(a) above are calculated in accordance with, and subject to, the limitations set forth in the definition of "Consolidated EBITDA" (or equivalent defined term) in the Credit Agreement, including any applicable cap on the aggregate amount of projected cost savings, operating expense reductions, restructuring charges, non-recurring items, and other add-backs that may be included in such calculation. The undersigned has reviewed each add-back category and confirms that each item qualifies as a permitted adjustment under the applicable provisions of the Credit Agreement.

(d) Pro forma cash and cash equivalents reflect management's good faith estimates as of the Closing Date based on information available as of the date hereof, including estimated wire transfer amounts, settlement figures provided by Atlas Meridian Bank, N.A. (as payoff agent under the Existing Credit Agreement), and fee invoices received from the Borrower's advisors and service providers. Actual cash and cash equivalents on the Closing Date may differ from the estimates set forth herein due to timing differences, rounding, and final settlement adjustments; provided that the undersigned does not expect any such differences to be material or to affect the compliance certifications set forth in Section 5 above.

(e) This Certificate is delivered solely for the benefit of the Administrative Agent and the Lenders under the Credit Agreement and may not be relied upon by any other person or entity without the prior written consent of the Borrower. Nothing in this Certificate shall be construed as an amendment, waiver, or modification of any provision of the Credit Agreement or any other Loan Document.

Section 8. Execution

IN WITNESS WHEREOF, the undersigned has executed this Certificate as of March 28, 2025.

NEXFORD INDUSTRIAL HOLDINGS INC.

By: ________

Name: Michelle Kaplan

Title: Chief Financial Officer

Date: March 28, 2025

EXHIBIT A

Pro Forma Leverage Ratio Calculation Worksheet

The following worksheet sets forth the calculation of the pro forma leverage ratios of the Borrower after giving effect to the Transactions on the Closing Date, in accordance with the definitions and methodologies set forth in the Credit Agreement:

EXHIBIT B

Sources and Uses Summary

The following table sets forth a summary of the sources and uses of funds in connection with the Transactions to be consummated on the Closing Date:

Sources.

Uses.

This Certificate and the Exhibits attached hereto constitute confidential information and are subject to the confidentiality provisions set forth in Section 10.07 of the Credit Agreement. This Certificate is delivered solely in satisfaction of the conditions precedent set forth in Section 4.01 of the Credit Agreement and shall not be construed as creating any obligation or liability of the Borrower beyond those set forth in the Credit Agreement and the other Loan Documents.

Component	Amount
LTM Revenue (fiscal year ended December 31, 2024)	$2,100,000,000
LTM Reported EBITDA (before permitted add-backs)	$357,000,000

Permitted Add-Backs:

Acquisition-related costs (due diligence, integration planning, and advisory costs incurred in connection with permitted acquisitions during the LTM Period)	$12,000,000
Non-recurring restructuring charges (facility closures and workforce realignment costs classified as non-recurring under the Credit Agreement)	$8,500,000
Sponsor management fees (management consulting fees payable to Granite Peak Capital Partners, L.P. pursuant to the Management Agreement, which fees will be terminated upon consummation of the Transactions)	$4,500,000
Integration costs (systems integration and operational alignment costs related to the May 2024 acquisition of Cornerstone Flow Technologies, Inc.)	$3,000,000
Total Permitted Add-Backs	$28,000,000
LTM Adjusted EBITDA	$385,000,000
Instrument	Principal Amount
Term Loan B (new facility under the Credit Agreement)	$1,400,000,000
Total Pro Forma First Lien Secured Indebtedness	$1,400,000,000
Instrument	Principal Amount
Term Loan B (new facility under the Credit Agreement)	$1,400,000,000
7.250% Senior Unsecured Notes due 2028	$250,000,000
Total Pro Forma Indebtedness	$1,650,000,000
Component	Amount
Pro Forma Cash and Cash Equivalents (Closing Date)	$100,000,000
Metric	Calculation	Amount
Pro Forma First Lien Net Indebtedness	$1,400,000,000 − $100,000,000	$1,300,000,000
Pro Forma Total Net Indebtedness	$1,650,000,000 − $100,000,000	$1,550,000,000
Component	Amount / Ratio
Pro Forma First Lien Net Indebtedness (numerator)	$1,300,000,000
LTM Adjusted EBITDA (denominator)	$385,000,000
Pro Forma First Lien Net Leverage Ratio	3.377x (rounded to 3.38x)
Component	Amount / Ratio
Pro Forma Total Net Indebtedness (numerator)	$1,550,000,000
LTM Adjusted EBITDA (denominator)	$385,000,000

Pro Forma Total Net Leverage Ratio	4.026x (rounded to 4.03x)
Metric	Amount / Detail
LTM Capital Expenditures (fiscal year ended December 31, 2024)	$78,000,000
LTM Unlevered Free Cash Flow (Adjusted EBITDA less CapEx)	$307,000,000
Pro Forma Quarterly Amortization (Term Loan B)	$3,500,000 per quarter
Annual Amortization Rate	1.00% per annum of original principal amount of $1,400,000,000
First Quarterly Amortization Payment Due	June 30, 2025
Maturity Date (Term Loan B)	March 28, 2032
Applicable Margin (Term Loan B)	Term SOFR + 400 basis points per annum
SOFR Floor	0.75%
Credit Spread Adjustment (1-month SOFR)	10 basis points (0.10%)
Credit Spread Adjustment (3-month SOFR)	15 basis points (0.15%)
Line	Description	Amount
1	Term Loan B — principal amount (new facility under the Credit Agreement)	$1,400,000,000
2	7.250% Senior Unsecured Notes due 2028 — outstanding principal amount	$250,000,000
3	Total First Lien Secured Indebtedness (Line 1)	$1,400,000,000
4	Total Indebtedness (Line 1 + Line 2)	$1,650,000,000
5	Pro Forma Cash and Cash Equivalents (Closing Date)	$100,000,000
6	First Lien Net Indebtedness (Line 3 − Line 5)	$1,300,000,000
7	Total Net Indebtedness (Line 4 − Line 5)	$1,550,000,000
8	LTM Adjusted EBITDA (twelve months ended December 31, 2024)	$385,000,000
9	First Lien Net Leverage Ratio (Line 6 ÷ Line 8)	3.38x
10	Total Net Leverage Ratio (Line 7 ÷ Line 8)	4.03x
11	Maximum Permitted First Lien Net Leverage Ratio (per Section 7.11 of the Credit Agreement)	5.00x
12	Compliance (Line 9 ≤ Line 11)	Yes

Source	Amount	% of Total
Term Loan B (Credit Agreement dated March 28, 2025)	$1,400,000,000	100.0%
Total Sources	$1,400,000,000	100.0%
Use	Amount	% of Total
Refinance existing first lien term loan (Atlas Meridian Bank, N.A. — principal of $875,000,000 plus approximately $4,375,000 accrued interest)	$879,375,000	62.8%
Terminate existing revolving credit facility (Atlas Meridian Bank, N.A. — $190,000,000 commitment; $0 drawn)	$0	0.0%
Distribution to Granite Peak NIH Holdings, LLC	$335,000,000	23.9%
Transaction fees and expenses (arrangement fees, OID, legal, advisory, rating agency, and other costs)	$38,625,000	2.8%
Cash retained on balance sheet	$147,000,000	10.5%
Total Uses	$1,400,000,000	100.0%

BORROWER'S CERTIFICATE — PRO FORMA COMPLIANCE
(Leverage Ratios)
Delivered Pursuant to Section 4.01 of the Credit Agreement
Reference: Credit Agreement dated as of March 28, 2025 (as amended, restated, supplemented, or otherwise modified from time to time, the "Credit Agreement"), among Nexford Industrial Holdings Inc., a Delaware corporation (the "Borrower"), the Guarantors party thereto, Crescent Harbor Bank, N.A., as Administrative Agent and Collateral Agent (in such capacity, the "Administrative Agent"), Ironwood Capital Markets, LLC and Northvane Securities, Inc., as Joint Lead Arrangers and Joint Bookrunners, and the Lenders from time to time party thereto.
Certificate Date: March 28, 2025
Delivered to:
Crescent Harbor Bank, N.A. as Administrative Agent 320 Federal Street Boston, Massachusetts 02110
Attention: Agency Services — Leveraged Finance
Section 1. Recitals and Introductory Certification
This Borrower's Certificate — Pro Forma Compliance (this "Certificate") is delivered by Nexford Industrial Holdings Inc. (the "Borrower"), a corporation duly organized and existing under the laws of the State of Delaware, with its principal place of business located at 1400 Industrial Parkway, Schaumburg, Illinois 60173 (Employer Identification Number: 36-4178552), to the Administrative Agent pursuant to the Credit Agreement referenced above.
The undersigned, Michelle Kaplan, Chief Financial Officer of the Borrower, hereby certifies, solely in her capacity as an authorized officer of the Borrower and not in her individual capacity, pursuant to Section 4.01 (Conditions Precedent to the Closing Date Borrowing) of the Credit Agreement, as follows:
Capitalized terms used but not otherwise defined in this Certificate shall have the respective meanings ascribed to such terms in the Credit Agreement. In the event of any conflict between the terms used herein and the definitions set forth in the Credit Agreement, the definitions in the Credit Agreement shall control.
This Certificate is being delivered to the Administrative Agent in connection with the initial borrowing of One Billion Four Hundred Million Dollars ($1,400,000,000) in aggregate principal amount of Term B Loans (the "Term Loans") under the Credit Agreement on the Closing Date, which is March 28, 2025. The delivery of this Certificate constitutes a condition precedent to the making of the Term Loans by the Lenders on the Closing Date, as set forth in Section 4.01(j) of the Credit Agreement. The undersigned has reviewed the terms of the Credit Agreement and has made, or has caused to be made under her supervision, such examination and investigation as is necessary to enable her to express an informed opinion as to the matters set forth herein.
Section 2. Description of the Transaction
The proceeds of the Term Loans, together with existing cash on the balance sheet of the Borrower, will be applied on the Closing Date to consummate the transactions described below (collectively, the "Transactions"):
(a) Refinancing of the Existing First Lien Term Loan. The Borrower will use a portion of the Term Loan proceeds to repay in full all outstanding obligations under the existing first lien term loan facility (the "Existing Term Loan") arising under that certain Credit Agreement dated as of June 14, 2019 (as amended by the First Amendment dated December 3, 2020, the Second Amendment dated April 15, 2022, the Third Amendment dated January 27, 2023, and the Fourth Amendment dated September 12, 2024, collectively, the "Existing Credit Agreement"), among the Borrower, Atlas Meridian Bank, N.A., as administrative agent, and the lenders from time to time party thereto. The payoff amount for the Existing Term Loan is approximately $879,375,000, consisting of $875,000,000 in outstanding principal amount plus approximately $4,375,000 in accrued and unpaid interest calculated through and including the Closing Date. Upon such repayment, all commitments, obligations, and liens arising under the Existing Credit Agreement with respect to the term loan facility will be terminated and released.
(b) Termination of the Existing Revolving Credit Facility. The existing revolving credit facility under the Existing Credit Agreement, with aggregate revolving commitments of $190,000,000 (the "Existing Revolver"), has no amounts currently drawn thereunder. On the Closing Date, the revolving commitments under the Existing Revolver will be permanently reduced to zero and all commitments thereunder will be terminated in full. No amounts are payable in connection with such termination other than customary breakage, administrative, and termination fees, which are included in transaction fees and expenses described in clause (d) below.
(c) Distribution to Holdings. The Borrower will pay a distribution (the "Holdings Distribution") of approximately $335,000,000 to Granite Peak NIH Holdings, LLC, a Delaware limited liability company that is the direct parent of the Borrower and a Holdings Guarantor under the Credit Agreement (the "Holdings"), which amount will be applied by Holdings for general corporate purposes and to fund a return of capital to its equityholders.
(d) Payment of Transaction Fees and Expenses. The Borrower will use approximately $38,625,000 of the Term Loan proceeds to pay fees and expenses incurred in connection with the Transactions, consisting of the following:
(i) arrangement fees payable to the Joint Lead Arrangers: $7,000,000;
(ii) original issue discount ("OID") on the Term Loans (representing an issue price of 99.50%): $7,000,000;
(iii) legal fees and expenses of counsel to the Borrower (Davis Harmon & Blackwell LLP) and counsel to the Administrative Agent and the Joint Lead Arrangers (Whitfield Crane & Associates LLP): approximately $9,250,000;
(iv) financial advisory fees: approximately $6,500,000;
(v) rating agency fees (S&P Global Ratings and Moody's Investors Service): approximately $1,875,000;
(vi) title, lien search, and filing fees: approximately $2,500,000;
(vii) other customary closing costs, including due diligence expenses, printing costs, trustee and paying agent fees associated with the Existing Credit Agreement payoff, and administrative agent fees: approximately $5,500,000; and
(viii) aggregate transaction fees and expenses: approximately $38,625,000.
(e) Cash Retained on the Balance Sheet. The remaining proceeds of the Term Loans in the amount of approximately $147,000,000 will be retained on the balance sheet of the Borrower as unrestricted cash and cash equivalents, available for general corporate purposes.
(f) Total Sources. The total sources of funds for the Transactions are $1,400,000,000, consisting solely of the proceeds of the Term Loans under the Credit Agreement.
For the avoidance of doubt, the existing $250,000,000 aggregate principal amount of 7.250% Senior Unsecured Notes due 2028 of the Borrower (the "Senior Unsecured Notes"), issued under that certain Indenture dated as of November 8, 2021 (as supplemented from time to time, the "Notes Indenture"), between the Borrower and Pinnacle Trust Company, as trustee (the "Notes Trustee"), are not being refinanced, repurchased, redeemed, or otherwise retired in connection with the Transactions and will remain outstanding following the Closing Date. The Senior Unsecured Notes will constitute "Indebtedness" of the Borrower for all purposes under the Credit Agreement, including for purposes of the leverage ratio calculations set forth herein.
Section 3. Pro Forma Financial Data
The following pro forma financial data has been prepared by the Borrower for purposes of demonstrating compliance with the financial covenant and related conditions precedent set forth in the Credit Agreement, after giving pro forma effect to the Transactions as if they had occurred on the first day of the applicable measurement period (for income statement items) or the Closing Date (for balance sheet items).
3(a). LTM Adjusted EBITDA
The Borrower's Consolidated EBITDA (as defined in the Credit Agreement and referred to herein as "Adjusted EBITDA") for the last twelve months ended December 31, 2024 (the "LTM Period") is calculated as follows:
The Adjusted EBITDA figure set forth above is calculated in accordance with, and subject to, the definition of "Consolidated EBITDA" (or equivalent defined term) in the Credit Agreement, including all applicable limitations on the amount and type of permitted add-backs. The Borrower confirms that the total amount of cost savings, synergies, restructuring charges, and similar add-backs included in Adjusted EBITDA does not exceed the cap, if any, set forth in the Credit Agreement.
3(b). Pro Forma Indebtedness
After giving pro forma effect to the Transactions, the Borrower's consolidated indebtedness is as follows:
Pro Forma First Lien Secured Indebtedness:
Pro Forma Total Indebtedness:
For the avoidance of doubt, the existing first lien term loan under the Existing Credit Agreement ($875,000,000 in outstanding principal amount) and the existing revolving credit facility under the Existing Credit Agreement ($190,000,000 in aggregate commitments, with $0 currently drawn) will each be repaid in full and/or terminated at the closing of the Transactions. Accordingly, the obligations and commitments under the Existing Credit Agreement are excluded from the pro forma indebtedness figures set forth above. The Borrower has no other material indebtedness for borrowed money (including capital leases, purchase money obligations, or other indebtedness that would constitute "Indebtedness" as defined in the Credit Agreement) that is not reflected in the table above, other than ordinary course trade payables, accrued expenses, and immaterial subsidiary-level obligations.
3(c). Pro Forma Cash and Cash Equivalents
Cash and cash equivalents of the Borrower and its Restricted Subsidiaries on a consolidated basis, after giving pro forma effect to the Transactions, are as follows:
The pro forma cash balance of $100,000,000 is derived from (i) the Borrower's existing unrestricted cash and cash equivalents on hand immediately prior to the Closing Date, plus (ii) $147,000,000 in new cash retained on the balance sheet from the Term Loan proceeds, net of (iii) working capital adjustments, transaction-related payments (including the fees and expenses described in Section 2(d) above), the Holdings Distribution described in Section 2(c) above, and the payoff of accrued interest on the Existing Term Loan. This amount represents management's good faith estimate of the consolidated cash position of the Borrower and its Restricted Subsidiaries as of the Closing Date, after giving effect to all components of the Transactions. For purposes of the net leverage ratio calculations below, "cash and cash equivalents" includes only unrestricted cash and Permitted Investments that constitute cash equivalents under the Credit Agreement and excludes any restricted cash, compensating balances, or cash held by Unrestricted Subsidiaries, if any.
3(d). Pro Forma Net Indebtedness
Based on the foregoing, the Borrower's pro forma net indebtedness is as follows:
Section 4. Pro Forma Leverage Ratio Calculations
4(a). First Lien Net Leverage Ratio
The Borrower's pro forma First Lien Net Leverage Ratio, calculated in accordance with the Credit Agreement, is as follows:
The Pro Forma First Lien Net Leverage Ratio of approximately 3.38 to 1.00 is below the maximum First Lien Net Leverage Ratio of 5.00 to 1.00 as set forth in Section 7.11 (Financial Covenant) of the Credit Agreement. Accordingly, after giving pro forma effect to the Transactions, the Borrower is in compliance with the financial covenant set forth in the Credit Agreement with respect to the First Lien Net Leverage Ratio, with approximately 1.62 turns of headroom (representing approximately $623,500,000 of incremental first lien net indebtedness capacity at the current level of Adjusted EBITDA).
4(b). Total Net Leverage Ratio
The Borrower's pro forma Total Net Leverage Ratio, calculated in accordance with the Credit Agreement, is as follows:
The Pro Forma Total Net Leverage Ratio of approximately 4.03 to 1.00 is presented for informational purposes and demonstrates the Borrower's overall leverage position after giving pro forma effect to the Transactions. The Credit Agreement does not contain a standalone total net leverage ratio financial maintenance covenant; however, certain provisions of the Credit Agreement (including, without limitation, provisions governing restricted payments, incremental facilities, and investments) reference the Total Net Leverage Ratio as an incurrence-based test, and the Borrower's compliance at the 4.03x level is noted accordingly.
Section 5. Compliance Certification
The undersigned hereby certifies, on behalf of the Borrower, that after giving pro forma effect to the Transactions (including the incurrence of $1,400,000,000 of Term Loans under the Credit Agreement, the repayment of all outstanding obligations under the Existing Credit Agreement, the termination of all commitments under the Existing Credit Agreement, the distribution of approximately $335,000,000 to Holdings, and the payment of approximately $38,625,000 in related transaction fees and expenses):
(a) The Pro Forma First Lien Net Leverage Ratio is approximately 3.38 to 1.00, which is less than the maximum First Lien Net Leverage Ratio of 5.00 to 1.00 permitted under Section 7.11 of the Credit Agreement;
(b) The Borrower is in compliance with the financial covenant set forth in Section 7.11 of the Credit Agreement as of the Closing Date on a pro forma basis;
(c) No Default or Event of Default (each as defined in the Credit Agreement) has occurred and is continuing as of the date hereof, or would result from the consummation of the Transactions contemplated hereby, under the Credit Agreement or any other Loan Document; and
(d) Each of the representations and warranties of the Borrower and the other Loan Parties set forth in the Credit Agreement and the other Loan Documents is true and correct in all material respects (or, in the case of any representation or warranty that is qualified by materiality, Material Adverse Effect, or similar qualifier, in all respects) on and as of the date hereof, except to the extent that any such representation and warranty expressly relates to an earlier date, in which case such representation and warranty is true and correct in all material respects (or in all respects, as applicable) as of such earlier date.
Note Regarding Springing Nature of Financial Covenant. The financial covenant set forth in Section 7.11 of the Credit Agreement (requiring that the First Lien Net Leverage Ratio not exceed 5.00 to 1.00) is a springing financial maintenance covenant that is tested on a quarterly basis only when the aggregate outstanding principal amount of revolving loans (under any revolving credit facility established under the Credit Agreement or any incremental revolving facility established pursuant to Section 2.14 of the Credit Agreement, if applicable) exceeds 40% of the aggregate revolving commitments at the end of such fiscal quarter. As of the Closing Date, no revolving credit facility is being established under the Credit Agreement, and accordingly, the springing financial covenant is not currently subject to testing. However, if a revolving credit facility is subsequently added to the Credit Agreement via an incremental facility pursuant to Section 2.14, the financial covenant will apply in accordance with its terms upon the conditions for testing being satisfied. The pro forma compliance demonstrated in this Certificate is provided as a condition precedent to the initial borrowing on the Closing Date pursuant to Section 4.01(j) of the Credit Agreement, and not as evidence of compliance with the quarterly testing requirements of Section 7.11, which are not currently applicable.
Section 6. Additional Pro Forma Metrics (For Informational Purposes)
The following additional metrics are provided for informational purposes only and do not constitute certifications required under the Credit Agreement. These metrics are intended to provide the Administrative Agent and the Lenders with supplemental information regarding the Borrower's pro forma financial profile:
Based on the foregoing, the Borrower's pro forma annual cash interest expense on the Term Loans (assuming a blended all-in interest rate of approximately 8.40% per annum based on current 1-month Term SOFR of approximately 4.30%, plus the applicable credit spread adjustment of 10 basis points, plus the applicable margin of 400 basis points) is estimated at approximately $117,600,000, resulting in a pro forma fixed charge coverage ratio (calculated as LTM Adjusted EBITDA divided by estimated annual cash interest expense plus scheduled amortization) of approximately 3.18x. This ratio is provided solely for illustrative purposes and is not a defined term or tested metric under the Credit Agreement.
Section 7. Assumptions and Qualifications
The calculations and certifications set forth in this Certificate are subject to the following assumptions and qualifications:
(a) All calculations herein are made on a pro forma basis giving effect to the Transactions as if they had occurred on the first day of the LTM Period (with respect to income statement items, including Adjusted EBITDA and its components) or the Closing Date (with respect to balance sheet items, including indebtedness and cash and cash equivalents), in each case in accordance with the definitions and methodologies set forth in the Credit Agreement, including the definition of "Pro Forma Basis" (or equivalent defined term) contained therein.
(b) All financial data underlying the calculations set forth herein is derived from the Borrower's audited consolidated financial statements for the fiscal year ended December 31, 2024, as audited by Ashworth & Kendrick LLP, an independent registered public accounting firm (Helen Yamamoto, Engagement Partner), and from the Borrower's internal management accounts and records, which the undersigned believes to be accurate and complete in all material respects as of the date hereof.
(c) The Adjusted EBITDA add-backs reflected in Section 3(a) above are calculated in accordance with, and subject to, the limitations set forth in the definition of "Consolidated EBITDA" (or equivalent defined term) in the Credit Agreement, including any applicable cap on the aggregate amount of projected cost savings, operating expense reductions, restructuring charges, non-recurring items, and other add-backs that may be included in such calculation. The undersigned has reviewed each add-back category and confirms that each item qualifies as a permitted adjustment under the applicable provisions of the Credit Agreement.
(d) Pro forma cash and cash equivalents reflect management's good faith estimates as of the Closing Date based on information available as of the date hereof, including estimated wire transfer amounts, settlement figures provided by Atlas Meridian Bank, N.A. (as payoff agent under the Existing Credit Agreement), and fee invoices received from the Borrower's advisors and service providers. Actual cash and cash equivalents on the Closing Date may differ from the estimates set forth herein due to timing differences, rounding, and final settlement adjustments; provided that the undersigned does not expect any such differences to be material or to affect the compliance certifications set forth in Section 5 above.
(e) This Certificate is delivered solely for the benefit of the Administrative Agent and the Lenders under the Credit Agreement and may not be relied upon by any other person or entity without the prior written consent of the Borrower. Nothing in this Certificate shall be construed as an amendment, waiver, or modification of any provision of the Credit Agreement or any other Loan Document.
Section 8. Execution
IN WITNESS WHEREOF, the undersigned has executed this Certificate as of March 28, 2025.
NEXFORD INDUSTRIAL HOLDINGS INC.
By: ________
Name: Michelle Kaplan
Title: Chief Financial Officer
Date: March 28, 2025
EXHIBIT A
Pro Forma Leverage Ratio Calculation Worksheet
The following worksheet sets forth the calculation of the pro forma leverage ratios of the Borrower after giving effect to the Transactions on the Closing Date, in accordance with the definitions and methodologies set forth in the Credit Agreement:
EXHIBIT B
Sources and Uses Summary
The following table sets forth a summary of the sources and uses of funds in connection with the Transactions to be consummated on the Closing Date:
Sources.  
Uses.  
This Certificate and the Exhibits attached hereto constitute confidential information and are subject to the confidentiality provisions set forth in Section 10.07 of the Credit Agreement. This Certificate is delivered solely in satisfaction of the conditions precedent set forth in Section 4.01 of the Credit Agreement and shall not be construed as creating any obligation or liability of the Borrower beyond those set forth in the Credit Agreement and the other Loan Documents.
Component | Amount
LTM Revenue (fiscal year ended December 31, 2024) | $2,100,000,000
LTM Reported EBITDA (before permitted add-backs) | $357,000,000
Permitted Add-Backs:
Acquisition-related costs (due diligence, integration planning, and advisory costs incurred in connection with permitted acquisitions during the LTM Period) | $12,000,000
Non-recurring restructuring charges (facility closures and workforce realignment costs classified as non-recurring under the Credit Agreement) | $8,500,000
Sponsor management fees (management consulting fees payable to Granite Peak Capital Partners, L.P. pursuant to the Management Agreement, which fees will be terminated upon consummation of the Transactions) | $4,500,000
Integration costs (systems integration and operational alignment costs related to the May 2024 acquisition of Cornerstone Flow Technologies, Inc.) | $3,000,000
Total Permitted Add-Backs | $28,000,000
LTM Adjusted EBITDA | $385,000,000
Instrument | Principal Amount
Term Loan B (new facility under the Credit Agreement) | $1,400,000,000
Total Pro Forma First Lien Secured Indebtedness | $1,400,000,000
Instrument | Principal Amount
Term Loan B (new facility under the Credit Agreement) | $1,400,000,000
7.250% Senior Unsecured Notes due 2028 | $250,000,000
Total Pro Forma Indebtedness | $1,650,000,000
Component | Amount
Pro Forma Cash and Cash Equivalents (Closing Date) | $100,000,000
Metric | Calculation | Amount
Pro Forma First Lien Net Indebtedness | $1,400,000,000 − $100,000,000 | $1,300,000,000
Pro Forma Total Net Indebtedness | $1,650,000,000 − $100,000,000 | $1,550,000,000
Component | Amount / Ratio
Pro Forma First Lien Net Indebtedness (numerator) | $1,300,000,000
LTM Adjusted EBITDA (denominator) | $385,000,000
Pro Forma First Lien Net Leverage Ratio | 3.377x (rounded to 3.38x)
Component | Amount / Ratio
Pro Forma Total Net Indebtedness (numerator) | $1,550,000,000
LTM Adjusted EBITDA (denominator) | $385,000,000
Pro Forma Total Net Leverage Ratio | 4.026x (rounded to 4.03x)
Metric | Amount / Detail
LTM Capital Expenditures (fiscal year ended December 31, 2024) | $78,000,000
LTM Unlevered Free Cash Flow (Adjusted EBITDA less CapEx) | $307,000,000
Pro Forma Quarterly Amortization (Term Loan B) | $3,500,000 per quarter
Annual Amortization Rate | 1.00% per annum of original principal amount of $1,400,000,000
First Quarterly Amortization Payment Due | June 30, 2025
Maturity Date (Term Loan B) | March 28, 2032
Applicable Margin (Term Loan B) | Term SOFR + 400 basis points per annum
SOFR Floor | 0.75%
Credit Spread Adjustment (1-month SOFR) | 10 basis points (0.10%)
Credit Spread Adjustment (3-month SOFR) | 15 basis points (0.15%)
Line | Description | Amount
1 | Term Loan B — principal amount (new facility under the Credit Agreement) | $1,400,000,000
2 | 7.250% Senior Unsecured Notes due 2028 — outstanding principal amount | $250,000,000
3 | Total First Lien Secured Indebtedness (Line 1) | $1,400,000,000
4 | Total Indebtedness (Line 1 + Line 2) | $1,650,000,000
5 | Pro Forma Cash and Cash Equivalents (Closing Date) | $100,000,000
6 | First Lien Net Indebtedness (Line 3 − Line 5) | $1,300,000,000
7 | Total Net Indebtedness (Line 4 − Line 5) | $1,550,000,000
8 | LTM Adjusted EBITDA (twelve months ended December 31, 2024) | $385,000,000
9 | First Lien Net Leverage Ratio (Line 6 ÷ Line 8) | 3.38x
10 | Total Net Leverage Ratio (Line 7 ÷ Line 8) | 4.03x
11 | Maximum Permitted First Lien Net Leverage Ratio (per Section 7.11 of the Credit Agreement) | 5.00x
12 | Compliance (Line 9 ≤ Line 11) | Yes
Source | Amount | % of Total
Term Loan B (Credit Agreement dated March 28, 2025) | $1,400,000,000 | 100.0%
Total Sources | $1,400,000,000 | 100.0%
Use | Amount | % of Total
Refinance existing first lien term loan (Atlas Meridian Bank, N.A. — principal of $875,000,000 plus approximately $4,375,000 accrued interest) | $879,375,000 | 62.8%
Terminate existing revolving credit facility (Atlas Meridian Bank, N.A. — $190,000,000 commitment; $0 drawn) | $0 | 0.0%
Distribution to Granite Peak NIH Holdings, LLC | $335,000,000 | 23.9%
Transaction fees and expenses (arrangement fees, OID, legal, advisory, rating agency, and other costs) | $38,625,000 | 2.8%
Cash retained on balance sheet | $147,000,000 | 10.5%
Total Uses | $1,400,000,000 | 100.0%

BORROWER'S CERTIFICATE — PRO FORMA COMPLIANCE

NEXFORD INDUSTRIAL HOLDINGS INC.

EXHIBIT A

EXHIBIT B

Record

Parties

Dates

Amounts