[sheet: Cover]

[sheet: Cover]
Field | Value
Document Title | Compliance Certificate — Incurrence Test Calculations (Pro Forma)
Client | Nexford Industrial Holdings Inc.
Matter Number | 1005-00002
Firm | Calderwood & Harkness LLP
Firm Address | One Liberty Plaza, 48th Floor, New York, NY 10006
Prepared By | Eric Johannsen, Working Associate, Capital Markets
Reviewed By | Natasha Forbes, Lead Associate, Capital Markets
Responsible Partner | Jennifer Kwon, Partner, Capital Markets
Billing Partner | Theodore Langston, Partner, Capital Markets
Date | December 5, 2025
Transaction | $150,000,000 Add-On Tap of Existing 8.750% Senior Secured Notes due 2030
Indenture Date | March 15, 2023
Supplemental Indenture | First Supplemental Indenture, dated as of December 10, 2025 (expected)
Trustee / Collateral Agent | Ridgeline Trust Company, N.A.
Confidentiality | PRIVILEGED AND CONFIDENTIAL — ATTORNEY WORK PRODUCT
Purpose | Verification that the issuance of the Add-On Notes and the Kessler acquisition satisfy the incurrence covenants under the Indenture on a pro forma basis
Incurrence Basis | Add-On Notes incurred pursuant to the Ratio Basket (Section 4.09(a) of the Indenture), NOT the general Permitted Indebtedness basket
[sheet: Summary & Conclusion]
Test / Covenant | Requirement | Pro Forma Result | Pass / Fail | Notes
Fixed Charge Coverage Ratio (FCCR) — Ratio Basket Incurrence Test | ≥ 2.00x | 3.01x (see FCCR Calculation tab) | PASS | Calculated on a pro forma basis after giving effect to the $150M add-on issuance and the Kessler acquisition; uses PF Combined Adjusted EBITDA of $270,000,000
Permitted Indebtedness General Basket — Availability Check | Greater of $75,000,000 and 12.5% of Total Assets | N/A — Add-On Notes incurred under Ratio Basket, not General Basket | N/A | General basket preserved for future use; current estimated Total Assets ~$1,850,000,000; 12.5% = ~$231,250,000; basket = $231,250,000
Restricted Payments Basket — No RP Triggered | Greater of $60,000,000 and 10% of Total Assets | No restricted payment made in connection with offering | N/A | Basket preserved; 10% of Total Assets = ~$185,000,000; basket = $185,000,000
No Default or Event of Default | No Default or Event of Default under Indenture | Confirmed — per Officers' Certificate of Sandra Okafor and Raymond Chiu | PASS | Officers' Certificate to be delivered at closing December 10, 2025
Pro Forma Total Net Leverage (unadjusted EBITDA) | Informational — no maintenance test | ~4.08x | Informational | Reported as ~4.1x in offering materials; $918,750,000 ÷ $225,000,000
Pro Forma Secured Net Leverage (unadjusted EBITDA) | Informational — no maintenance test | ~2.71x | Informational | Reported as ~2.7x in offering materials; $608,750,000 ÷ $225,000,000
Pro Forma Total Net Leverage (adjusted EBITDA) | Informational — no maintenance test | ~3.40x | Informational | $918,750,000 ÷ $270,000,000
Pro Forma Secured Net Leverage (adjusted EBITDA) | Informational — no maintenance test | ~2.25x | Informational | $608,750,000 ÷ $270,000,000
[sheet: FCCR Calculation]
Line Item | Reference / Source | Nexford Standalone LTM ($) | Kessler LTM ($) | Pro Forma Adjustments ($) | Pro Forma Combined ($)
SECTION A: NUMERATOR — PRO FORMA ADJUSTED EBITDA
LTM Revenue (period ended September 30, 2025) | Nexford financials; Kessler financials | 1,280,000,000 | 115,000,000 | 0 | 1,395,000,000
LTM Net Income | Per Meridian Ledger LLP audited / reviewed financials | 78,000,000 | 8,500,000 | 0 | 86,500,000
(+) Interest Expense | See Fixed Charges below; add-back per Indenture definition | 52,500,000 | 1,200,000 | 36,137,500 | 89,837,500
(+) Income Tax Expense | Per financial statements | 28,000,000 | 3,100,000 | 0 | 31,100,000
(+) Depreciation & Amortization | Per financial statements | 64,000,000 | 9,200,000 | 0 | 73,200,000
(+) Non-cash Charges and Losses | Stock-based comp, impairment, etc. | 12,500,000 | 1,500,000 | 0 | 14,000,000
(+) Transaction Fees and Expenses (pro forma add-back) | Indenture Section 4.09 — one-time costs | 0 | 0 | 5,000,000 | 5,000,000
(+) Kessler Run-Rate Synergies (if permitted by Indenture) | Subject to Indenture definition caps; capped at 15% of PF EBITDA | 0 | 0 | 8,000,000 | 8,000,000
(-) Non-cash Income and Gains | Per financial statements | (8,000,000) | (500,000) | 0 | (8,500,000)
(+) Other Pro Forma Adjustments (cost savings, restructuring add-backs) | Per Indenture Consolidated EBITDA definition | 20,000,000 | 0 | (10,637,500) | 9,362,500
Subtotal — Components | 298,500,000
(-) Adjustments to reconcile to Adjusted EBITDA | Reconciliation to management Adj. EBITDA | (28,500,000) | (28,500,000)
LTM Adjusted EBITDA — Nexford Standalone | Nexford management / CFO Sandra Okafor | 247,000,000
LTM Adjusted EBITDA — Kessler | Kessler financials / acquisition diligence | 23,000,000
Pro Forma Combined Adjusted EBITDA (A) | Sum | 270,000,000
SECTION B: DENOMINATOR — PRO FORMA FIXED CHARGES
Interest on 8.750% Senior Secured Notes ($625M post-tap) | $625,000,000 × 8.750% | 54,687,500
Interest on 10.250% Senior Unsecured Notes ($310M) | $310,000,000 × 10.250% | 31,775,000
Interest on ABL Facility ($45M drawn, est. rate ~7.50%) | $45,000,000 × 7.50% | 3,375,000
ABL Commitment Fees (est.) | On undrawn portion (~$146.8M × 0.375%) | 550,500
Less: Kessler pre-acquisition third-party interest (eliminated) | Kessler debt repaid at closing | (550,500)
Scheduled Principal Amortization | None — bullet maturities on notes; revolver | 0
Preferred Dividends / Distributions | None | 0
Total Pro Forma Fixed Charges (B) | Sum of interest and scheduled amortization per Indenture definition | 89,837,500
SECTION C: FIXED CHARGE COVERAGE RATIO
Pro Forma FCCR = (A) / (B) | = $270,000,000 / $89,837,500
Pro Forma FCCR Result | 3.01x
Minimum Required FCCR (Incurrence Test) | Indenture Section 4.09(a) | 2.00x
Compliance | PASS
Note: Unadjusted EBITDA FCCR (using ~$225M headline EBITDA before ~$45M of run-rate adjustments) | = $225,000,000 / $89,837,500 | ~2.50x — also PASSES 2.00x test
[sheet: Pro Forma Capitalization]
Line Item | Pre-Deal (As of 9/30/2025) ($) | Add-On Notes Adjustment ($) | Kessler Acquisition Adjustment ($) | Fees & Expenses Adjustment ($) | Pro Forma ($)
DEBT
ABL Revolving Credit Facility ($200M commitment; Agent: Lakefront National Bank; maturity September 15, 2027) | 45,000,000 | 0 | 0 | 0 | 45,000,000
ABL Letters of Credit Outstanding | 8,200,000 | 0 | 0 | 0 | 8,200,000
ABL Availability | 146,800,000 | 0 | 0 | 0 | 146,800,000
8.750% Senior Secured Notes due March 15, 2030 (CUSIP 144A: 65438T AA5 / Reg S: U65438 AA7) | 475,000,000 | 150,000,000 | 0 | 0 | 625,000,000
  — Original Notes (issued March 15, 2023) | 475,000,000 | 0 | 0 | 0 | 475,000,000
  — Add-On Notes (temp. CUSIP 144A: 65438T AB3 / Reg S: U65438 AB5) | 0 | 150,000,000 | 0 | 0 | 150,000,000
10.250% Senior Unsecured Notes due 2031 | 310,000,000 | 0 | 0 | 0 | 310,000,000
Total Debt | 830,000,000 | 150,000,000 | 0 | 0 | 980,000,000
Total Secured Debt (Secured Notes + ABL Drawn) | 520,000,000 | 150,000,000 | 0 | 0 | 670,000,000
CASH AND EQUIVALENTS
Cash and Cash Equivalents | 52,000,000 | 152,250,000 | (138,000,000) | (5,000,000) | 61,250,000
  — Gross Proceeds from Add-On ($150M × 101.500%) | 152,250,000
  — Less: Initial Purchaser discount (1.750% × $150M) | (2,625,000)
  — Net Proceeds to Issuer (before other expenses) | 149,625,000
  — Less: Kessler Acquisition Consideration | (138,000,000)
  — Less: Estimated Transaction Fees & Expenses | (5,000,000)
  — Excess to Balance Sheet for General Corporate Purposes | 9,250,000
NET DEBT
Total Net Debt (Total Debt − Cash) | 778,000,000 | 918,750,000
Total Secured Net Debt (Secured Debt − Cash) | 468,000,000 | 608,750,000
EBITDA METRICS
LTM Adjusted EBITDA — Nexford Standalone | 247,000,000 | 247,000,000
LTM Adjusted EBITDA — Kessler (acquired) | 23,000,000 | 23,000,000
Pro Forma Combined Adjusted EBITDA | 270,000,000
Unadjusted EBITDA (before ~$45M run-rate adjustments) | 225,000,000
EBITDA Margin (PF Combined Adj. EBITDA / PF Revenue) | 19.4%
PF Revenue ($1,280M + $115M) | 1,395,000,000
LEVERAGE RATIOS
Pre-Deal Total Net Leverage (Nexford standalone) | 3.15x
Pro Forma Total Net Leverage (Adjusted EBITDA basis: $918.75M / $270M) | 3.40x
Pro Forma Total Net Leverage (Unadjusted EBITDA basis: $918.75M / $225M) | 4.08x
Pro Forma Total Net Leverage — As Reported in Offering Materials | ~4.1x
Pro Forma Secured Net Leverage (Adjusted EBITDA basis: $608.75M / $270M) | 2.25x
Pro Forma Secured Net Leverage (Unadjusted EBITDA basis: $608.75M / $225M) | 2.71x
Pro Forma Secured Net Leverage — As Reported in Offering Materials | ~2.7x
Note: ~4.1x total net leverage and ~2.7x secured net leverage figures in offering materials are based on unadjusted EBITDA (~$225M), which backs out ~$45M of run-rate adjustments included in the $270M Adjusted EBITDA figure for covenant purposes.
[sheet: Permitted Indebtedness Analysis]
Line Item | Amount / Detail | Notes
Indenture Reference | Section 4.09 — Limitation on Incurrence of Indebtedness | Indenture dated March 15, 2023, among Nexford Industrial Holdings Inc., the Guarantors, and Ridgeline Trust Company, N.A.
RATIO BASKET (Section 4.09(a))
Description | Issuer may incur additional Indebtedness if, after giving pro forma effect, the FCCR is at least 2.00x | Primary basket under which the Add-On Notes are being incurred
Pro Forma FCCR (per FCCR Calculation tab) | ~3.01x (adjusted EBITDA) / ~2.50x (unadjusted EBITDA) | Both exceed 2.00x minimum; PASS
Amount Incurred Under Ratio Basket | $150,000,000 (Add-On Notes principal) | Constitutes Additional Notes under the existing Indenture
Confirmation | Add-On Notes are incurred pursuant to the Ratio Basket and NOT the General Basket | Preserves General Basket capacity for future use
GENERAL BASKET (Section 4.09(b)(iv))
Basket Formula | Greater of $75,000,000 and 12.5% of Total Assets
Estimated Pro Forma Total Assets | ~$1,850,000,000 | Includes Kessler assets acquired at $138M purchase price
12.5% of Total Assets | ~$231,250,000 | $1,850,000,000 × 12.5%
General Basket Size | $231,250,000 | Greater of $75M and $231.25M
Currently Utilized Under General Basket | $0 | No existing indebtedness incurred under the general basket
Remaining General Basket Availability | $231,250,000 | Fully available for future incurrence
OTHER PERMITTED INDEBTEDNESS BASKETS
ABL Facility | $200,000,000 commitment ($45,000,000 drawn) | Incurred under Credit Facilities basket (Section 4.09(b)(i))
Existing Notes ($475M) | Incurred at original issuance under Ratio Basket | 8.750% Senior Secured Notes due 2030
Senior Unsecured Notes ($310M) | Incurred under Ratio Basket at issuance | 10.250% Senior Unsecured Notes due 2031
RESTRICTED PAYMENTS BASKET (Section 4.07) — Informational
RP Basket Formula | Greater of $60,000,000 and 10% of Total Assets | No restricted payment made in connection with the Add-On Notes offering
10% of Total Assets | ~$185,000,000 | $1,850,000,000 × 10%
RP Basket Size | $185,000,000 | Greater of $60M and $185M
RP Basket Status | Preserved | No RP capacity consumed by this transaction
[sheet: Use of Proceeds]
Line Item | Amount ($) | % of Gross Proceeds | Notes
SOURCES
Add-On Notes Gross Proceeds ($150M × 101.500%) | 152,250,000 | 100.0% | Issue price of 101.500% of par
Total Sources | 152,250,000 | 100.0%
USES
Kessler Precision Components, Inc. — Acquisition Consideration | 138,000,000 | 90.6% | Cash purchase price; 6.0x LTM EBITDA ($23M); sellers: The Kessler Family Trust (72%) and Northland Growth Equity Fund III, LP (28%)
Initial Purchaser discount (Broadleaf Securities LLC / Fieldstone Capital Markets, Inc.) | 2,625,000 | 1.7% | 1.750% × $150,000,000
Calderwood & Harkness LLP — Issuer's Counsel Legal Fees (cap) | 475,000 | 0.3% | Capped; plus disbursements
Whitmore & Stein LLP — Initial Purchasers' Counsel Legal Fees (est.) | 300,000 | 0.2% | Borne by Issuer per Purchase Agreement
Rating Agency Fees — Palladian Credit Research, Inc. and Veridian Ratings Group, LLC (combined) | 175,000 | 0.1% | Rating confirmation fees
Trustee Acceptance Fee — Ridgeline Trust Company, N.A. | 17,500 | 0.0% | One-time acceptance fee
Trustee Annual Administration Fee — Ridgeline Trust Company, N.A. | 12,500 | 0.0% | Annual fee
Other Estimated Transaction Costs (printing, DTC, misc.) | 1,395,000 | 0.9% | Estimate; balancing to ~$5M total transaction costs
Total Estimated Transaction Fees & Expenses | 5,000,000 | 3.3% | Approximate
Excess to Balance Sheet — General Corporate Purposes | 9,250,000 | 6.1% | Residual after acquisition and fees
Total Uses | 152,250,000 | 100.0%