Project Echo LBO Model Instructions

Transaction Assumptions
- Transaction Date of 12/31/2022
- EBITDA Multiple of 6.0x for purchase price calculation
- Calculate transaction (enterprise) value using LTM EBITDA and 6.0x purchase multiple.
- Subtract Debt and Add back balance sheet cash to calculate Implied Equity Purchase Price.
Sources and Uses
Uses
- Link equity purchase price to above
- Since debt will be paid down, this also needs to be included as a use of cash.
- Financing Fees of $8 MM
- Investment Banking Fees of $4 MM
- Legal Fees of $1 MM
- Other Fees and Expenses of $1 MM
- Total Uses will be the sum of all of the above items (Equity Purchase Price, Paydown of Debt, and Fees).
Sources
- Total Sources MUST equal Total Uses, so we need to first link Total Sources to the Total Uses cell.
- Initial Revolver will be drawn for any shortfalls (Revolver balance is equal to Total Uses less Sponsor Equity,
less Term Loan, less Senior Bonds, less Unsecured Debt). 7% cash interest rate.
- Term Loan will equal 2.0x EBITDA. Enter "2" into the EBITDA multiple cell, and multiply this by EBITDA.
7.5% cash interest rate. Amortize $20 million/yr. for 4 years, and pay off the balance at the end of year 5.
- Senior Bonds will be 1.5x EBITDA. 9.5% cash interest rate, 0% PIK interest rate.
- Unsecured Notes with Warrants 1.0x EBITDA. No cash interest, 10% PIK interest, and 5% Warrants.
- Sponsor Equity (i.e. the investment by the private equity firm) will be $104 million.
Pro Forma Balance Sheet
- Dec 31, 2019 Column - Insert the appropriate data from historical balance sheet in the 'Model' tab.
- Financing/Transaction Adjustments Column
- Any balance sheet cash used to help fund the transaction (i.e. all cash is zeroed out for PF BS).
- Transaction Fees should be linked to the corresponding section below, where fees are detailed.
- Goodwill should be linked to the 'Goodwill Calculation" below.
- All Existing Debt is to be refinanced as part of the transaction (i.e. should all be zeroed out)
- New Revolver, Term Loan, Senior Bonds, and Unsecured Debt should be linked to S&U page.
- Deferred financing charge (a contra liability) should be linked to the corresponding section below, where financing fees
are detailed (other transaction fees discussed below).
- Retained Earnings should be wiped out, and remaining transaction fees (all except financing fees)
should be taken out as well, such that Retained Earnings on the PF Balance Sheet will have a
negative balance equal to the amount of such transaction fees.
- "Common Stock" is again a balancing figure used to ensure that our Equity on the PF Balance Sheet
is equal to the Sponsor Equity on the S&U tab (Equity per the PF BS should be $104 million).
- Goodwill - Calculated as Equity Purchase Price less Total Shareholders' Equity on the 'Proforma
before New Financing' balance sheet.
- Amortizable Intangibles - will simply equal the Financing Fees per the S&U tab.
- Transaction Costs (excl. Financing Fees) - will equal sum of all other Transaction fees per the S&U tab.
- Pro Forma December 31, 2019 Column - should simply be the sum of the Pro Forma Before New Financing
column and the Financing/Transaction Adjustments column. PRO FORMA BALANCE SHEET MUST
BALANCE.
Assumptions Page
Balance Sheet
- Deferred financing charge to be amortized over a period of 5 years.
- Modify Revolver and Term Loan interest rate % by linking to the S&U page for each period.
- Insert row for Senior Bonds - Cash Interest rate % and link to the S&U page for each period.
- Modify Unsecured Debt - Cash Interest rate % by linking to the S&U page for each period.
- Insert 2 rows for "Senior Bonds - PIK Interest" rate % and "Unsecured Debt - PIK Interest" rate %, and
link to the S&U page for each period.
- Insert 3 rows (below the LIBOR and Interest earned on cash rates) for (i) Term Loan Amortization; (ii) Senior
Bonds Amortization; and, (iii) Unsecured Debt Amortization.
- For Term Debt Amortization, this should be $20 million per year for each of the first four years, followed by the
balance in year 5. For Senior Bonds and Unsecured Debt Amortization, enter $0 in all periods.
Project Echo LBO Model Instructions
Model Page
Income Statement
- Make sure the Financing Fees are appropriately amortized in years 1-5.
Balance Sheet
- Insert new rows to accommodate the 'Amortizable Intangibles' line item.
- Insert four new rows for new debt line items and title each accordingly.
- Insert a Pro Forma 2020 column to reflect the B/S change and link to proforma B/S
- Be sure to link projected first year Amortizable Intangibles and Goodwill to the Proforma B/S, and not the
Historical (pre-transaction) B/S.
- Be sure that all 'Existing Debt' is zeroed out during the forecast period, and that the 'New Debt' balances are
sourced from the Debt Schedule at the bottom of the model (more on that below).
- Be sure that first year Retained Earnings and Common Stock are linked to the Proforma B/S, and not the
Historical B/S.
Cash Flow Statement
- Insert a new row under Depreciation and Amortization for PIK Interest Expense (since it is non-cash).
- Modify the projected working capital accounts and Other Liabilities accounts such that the first year of the
forecast period is comparing the relevant balance sheet line items to those in the Proforma B/S and NOT
the Historical B/S.
- Insert a 'Change in Senior Bonds' row beneath the 'Change in Term Loan' in the Cash Flow from
Financing section.
- Ensure that changes in each Long-Term Debt item are calculated relative to the Proforma B/S and not the
Historical B/S.
- For changes in the Senior Bonds and Unsecured Debt, be sure to subtract PIK Interest, as it is a non-cash
item and should be added back per the Cash From Operations section above.
- Modify the projected Cash Flow before Revolver to include the 'Change in Senior Bonds' line item.
- Ensure that the 'Beginning Cash' line item is sourced from the Proforma B/S and not the Historical B/S.
Debt and Interest Schedule
- Rather than create a new interest schedule for each piece of long-term debt, we will simply re-use the
existing interest schedules but change the begnning balances for each piece of debt (see next step).
- Ensure that the beginning balances for ALL debt items in the Debt and Interest Schedule are linked to the
Proforma B/S.
- Insert a 'Senior Bonds' section between the 'Term Debt' and 'Unsecured Debt' in the Debt and Interest
Schedule.
- Ensure all interest rates are linked back to the Assumptions page for each period.
- Ensure that all annual amortization (for ONLY the Term Loan, Senior Bonds, and Unsecured Debt - NOT
the Revolver) is linked back to the Assumptions page for each period.
- In the Senior Bonds and Unsecured Debt sections, change the Interest Rate and Interest Expense line
items to read "Cash Interest Rate" and "Cash Interest Expense," respectively (as opposed to PIK Interest,
covered in the next step). Ensure the Cash Interest rates link to the Assumptions page.
- Under both the Senior Bonds and Unsecured Debt sections, add two lines and title them "PIK Interest
Rate" and "PIK Interest Expense," respectively. Ensure the PIK Interest Rates link to the Assumptions page.
- Set up the model to calculate both Cash and PIK Interest. Cash interest should be calculated using the
average balance method as we did when constructing our first financial model. PIK Interest should be
calculated based off of the Beginning Balance, however, so as not to create a circular reference in the model.
PIK Interest is then included in the Ending Balance for each piece of debt in each year.
- Insert Total Interest Expense and Cash Interest Expense rows and calculate accordingly (Total Interest
Expense includes PIK Interest; Cash Interest Expense does not).
- Ensure that Interest Income on Cash Balances for year 1 is calculated using the Proforma B/S (and not the
Historical B/S). All other years can remain unchanged.
Sources and Uses Page (Sale of the Company)
- Exit Year 2024 and purchase price is 6.0x EBITDA (set purchase multiple equal to purchase multiple above).
- For transaction expenses - assume 1% of Purchase Price for Investment Banking Fees, plus another $2
million in legal and other expenses.
IRR Analysis
- Calcualate IRR for both the Sponsor (private equity firm) and the Unsecured Lender.
Summary of Relevent Financial Statistics
- Link and calculate this section
LBO of Project Echo
($ in millions)

Transaction Assumptions
Closing Date 31-Dec-21
2021 EBITDA $60.0
EBITDA Multiple 6.0x
Transaction (Enterprise) Value $360.0
Less: Existing Debt ($190.8)
Plus: Cash $0.0
Implied Equity Purchase Price $169.2

Total Uses Tot

Capitalization
Cash
Equity Purchase Price $169.2 Revolver
Paydown Existing Debt $190.8 Term Loan
Financing Fees 8.0 Senior Bonds
Investment Banking Fees 4.0 Unsecured Notes with Warrants
Legal Fees 1.0 Total Debt
Other Fees and Expenses 1.0 Sponsor Equity
Total Uses $374.0 Total Sources

Sale of Company in 2024

Closing Date 31-Dec-26 IRR to Financial Sponsor 12/31/21
Initial Equity Investment ($104.0)
2026 EBITDA $76.6 Dividends $0.0
EBITDA Multiple 6.0x Proceeds at Sale $0.0
Transaction Value $459.5 Total Cash Flows to Sponsor ($104.0)
Less: Total Debt (186.6) IRR Calculation 21.2%
Plus: Cash Balance 20.5
Less: Transaction Fees (1) (6.6) IRR to Unsecured Lender 12/31/21
Equity Value $286.7 Initial Loan ($60.0)
% Equity to Sponsor 95.0% Cash Interest Received $0.0
Equity to Sponsor $272.4 Principal Repayment at Sale $0.0
Equity from Warrants at Sale 0.0
% Equity to Unsecured Lender 5.0% Total Cash Flows to Lender ($60.0)
Equity to Unsecured Lender $14.3 IRR Calculation 13.1%

(1) Assumes 1% of Purchase Price for Investment Banking Fees, plus $2 million in legal and other expenses.

Summary of Relevant Financial Statistics

Income Statement Statistics 2022E
Revenue $210.0
EBITDA
Net Income
Net Interest Expense
Cash Interest Expense
Taxes

Revenue Growth
EBITDA Margin
EBITDA Growth
Net Income Margin
Net Income Growth

Balance Sheet / Cash Flow Statistics

Cash
Total Debt
Net Debt
Secured Debt
Capex
Increase (Decrease) in W/C

Leverage Ratios
Total Debt / EBITDA
Net Debt / EBITDA
Secured Debt / EBITDA

Interest Coverage Statistics

EBITDA / Net Interest Expense
EBITDA / Cash Interest
EBITDA - Capex / Net Interest Expense
EBITDA - Capex / Cash Interest Expense
EBITDA - Capex - ∆ W/C / Net Interest Expense
EBITDA - Capex - ∆ W/C / Cash Interest Expense
EBITDA - Capex - ∆ W/C - Taxes/ Net Int Exp
EBITDA - Capex - ∆ W/C - Taxes/ Cash Int Exp
 Total Sources
Amount EBITDA % of Interest Rate % of Fully
Funded Multiple Capitalization Cash Pay PIK Diluted Equity
$0.0 0.0x 0.0%
0.0 0.0x 0.0% 7.0% na na
120.0 2.0x 32.1% 7.5% na na
90.0 1.5x 24.1% 9.5% 0.0% na
60.0 1.0x 16.0% 0.0% 10.0% 5.0%
270.0 4.5x 72.2%
104.0 1.7x 27.8%
$374.0 6.2x 100.0%

12/31/22 12/31/23 12/30/24 12/31/25 12/31/26

$0.0 $0.0 $0.0 $0.0 $0.0
$0.0 $0.0 $0.0 $0.0 $0.0
$0.0 $0.0 $0.0 $0.0 $272.4
$0.0 $0.0 $0.0 $0.0 $272.4

12/31/22 12/31/23 12/30/24 12/31/25 12/31/26

$0.0 $0.0 $0.0 $0.0 $0.0
$0.0 $0.0 $0.0 $0.0 $0.0
$0.0 $0.0 $0.0 $0.0 $96.6
0.0 0.0 0.0 0.0 $14.3
$0.0 $0.0 $0.0 $0.0 $111.0
2023P 2024P 2025P 2026P
$220.5 $231.5 $243.1 $255.3
#REF!
 Proforma Balance Sheet
($ in millions) Historical Negative Positive Proforma
Balance Sheet Dec. 31 Adjustments Adjustments Dec. 31
2021 2021
Cash $0.0 $0.0 $0.0 $0.0
Accounts Receivable $16.0 0.0 0.0 $16.0
Inventory $10.0 0.0 0.0 $10.0
Other Current Assets $1.0 0.0 0.0 $1.0
Total Current Assets $27.0 $0.0 $0.0 $27.0

Gross PP&E $323.2 $0.0 $0.0 $323.2

Cumulative Depreciation $45.0 0.0 0.0 $45.0
Net PP&E $278.2 $0.0 $0.0 $278.2

Amortizable Intangibles $0.0 $0.0 $8.0 $8.0

Goodwill 5.0 0.0 65.2 $70.2
Total Assets $310.2 $0.0 $73.2 $383.4

Liabilities
Accounts Payable $11.0 $0.0 $0.0 $11.0
Accrued Liabilities $2.4 0.0 0.0 $2.4
Other Current Liabilities $0.0 0.0 0.0 $0.0
Total Current Liabilities $13.4 $0.0 $0.0 $13.4

Existing Debt
Revolving Credit Facility $40.8 ($40.8)
Term Loan $100.0 ($100.0)
Unsecured Debt $50.0 ($50.0)

New Debt
Revolving Credit Facility $0.0 $0.0 $0.0
Term Loan $0.0 $120.0 $120.0
Senior Bonds $0.0 $90.0 $90.0
Unsecured Debt $0.0 $60.0 $60.0

Other Liabilities $2.0 $0.0 $0.0 $2.0

Total Liabilities $206.2 ($190.8) $270.0 $285.4

Shareholders Equity
Retained Earnings $94.0 ($94.0) ($6.0) ($6.0)
Common Stock $10.0 ($10.0) $104.0 $104.0
Total Shareholders Equity $104.0 ($104.0) $98.0 $98.0

Total Liabilities and Equity $310.2 ($294.8) $368.0 $383.4

Check $0.0 $294.8 ($294.8) $0.0

Goodwill Calculation
Equity Purchase Price $169.2
 Less: Fair Value of Equity (104.0)
New Goodwill $65.2
FMV is assumed to be same as book value

Amortizable Intangibles Calculation

Financing Fees $8.0
New Intangible Assets $8.0

Transaction Fees Calculation

Investment Banking Fees $4.0
Legal Fees $1.0
Other Fees and Expenses $1.0
Transaction Fees Expensed at Closing $6.0
Project Echo - Financial Model - Working Version
Historical Variables and Assumptions for Projections

Historical Variables and Drivers Assumptions for Projections

($ in millions) Fiscal Year Ending December 31, Fiscal Year Ending December 31,
2017A 2018A 2019A 2020A 2021E 2022P 2023P 2024P 2025P
Income Statement Drivers / Assumptions
Revenue Growth Rate na 6.3% 5.9% 5.6% 5.3% 5.0% 5.0% 5.0% 5.0%

COGS as % of Revenue 42.0% 41.5% 41.0% 41.0% 40.0% 40.0% 40.0% 40.0% 40.0%

Depreciation as % of Gross PP&E 1.8% 1.7% 1.7% 1.6% 1.5% 2.0% 2.0% 2.0% 2.0%
Amortization $0.0 $0.0 $0.0 $0.0 $0.0 $1.6 $1.6 $1.6 $1.6
Years 5
SG&A as % of Sales 30.0% 30.0% 30.0% 30.0% 30.0% 30.0% 30.0% 30.0% 30.0%

Other Income / (Expense) $2.0 $0.0 ($2.0) $1.0 $0.0 $0.0 $0.0 $0.0 $0.0

Tax Rate 40.0% 40.0% 40.0% 40.0% 40.0% 40.0% 40.0% 40.0% 40.0%

Balance Sheet Drivers / Assumptions

Days Accounts Receivable 26 27 27 28 30 30 30 30
Days Inventory 42 43 43 44 45 45 45 45
Other Current Assets $1.0 $1.0 $1.0 $1.0 $1.0 $1.0 $1.0 $1.0 $1.0
Other Assets $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0

Capex as % of Sales na 5.9% 6.1% 6.3% 6.5% 5.0% 5.0% 5.0% 5.0%
Asset Disposition na $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0
Days Payable 45 45 45 47 50 50 50 50
Accrued Liabilities as % of COGS 3.0% 3.0% 3.0% 3.0% 3.0% 3.0% 3.0% 3.0% 3.0%
Other Current Liabilities as % of COGS 1.5% 0.0% 2.7% 1.3% 0.0% 2.0% 2.0% 2.0% 2.0%
Other Liabilities $1.0 $2.0 $1.0 $0.0 $2.0 $2.0 $2.0 $2.0 $2.0

Common Stock $10.0 $10.0 $10.0 $10.0 $10.0 $10.0 $10.0 $10.0 $10.0

Interest Rate Assumptions

LIBOR 0.50% 0.25% 0.25% 0.50% 0.75% 1.25% 2.00% 2.50% 3.00%
Interest earned on cash 0.25% 0.13% 0.13% 0.25% 0.38% 0.75% 1.00% 1.25% 1.50%

Revolver LIBOR + 2.0% 2.50% 2.25% 2.25% 2.50% 2.75% 7.00% 7.00% 7.00% 7.00%
Term Loan LIBOR + 2.5% 3.00% 2.75% 2.75% 3.00% 3.25% 7.50% 7.50% 7.50% 7.50%
Senior Bonds - Cash 9.50% 9.50% 9.50% 9.50%
Senior Bonds - PIK 0.00% 0.00% 0.00% 0.00%
Unsecured Debt - Cash 12.00% 12.00% 12.00% 12.00% 12.00% 12.00% 0.00% 0.00% 0.00% 0.00%
Unsecured Debt - PIK 10.00% 10.00% 10.00% 10.00%

Term Loan Amortization $20.0 $20.0 $20.0 $20.0 $20.0 $20.0 $20.0 $20.0 $20.0
Senior Bonds - Amortization $0.0 $0.0 $0.0 $0.0
Unsecured Debt Amortization $ - $ - $ - $ - $ - $0.0 $0.0 $0.0 $0.0

Page 10
for Projections
ng December 31,
2026P

5.0%

40.0%

2.0%
$1.6

30.0%

$0.0

40.0%

30
45
$1.0
$0.0

5.0%
$0.0
50
3.0%
2.0%
$2.0

$10.0

3.50%
1.75%

7.00%
7.50%
9.50%
0.00%
0.00%
10.00%

$40.0
$0.0
$0.0

Page 11
Project Echo - Financial Model - Working Version
Control Panel
All years balance OK OK OK OK OK OK OK
No negative cash balance OK OK OK OK OK OK OK

Historical Financial Statements Projected Financial Statements

($ in millions) Fiscal Year Ending December 31, Fiscal Year Ending December 31,
2017A 2018A 2019A 2020A 2021E 2021PF 2022P 2023P 2024P 2025P
Income Statement
Revenue $160.0 $170.0 $180.0 $190.0 $200.0 $210.0 $220.5 $231.5 $243.1
% Growth na 6.3% 5.9% 5.6% 5.3% 5.0% 5.0% 5.0% 5.0%

Cost of Goods Sold (1) $67.2 $70.6 $73.8 $77.9 $80.0 $84.0 $88.2 $92.6 $97.2
COGS as % of Revenue 42.0% 41.5% 41.0% 41.0% 40.0% 40.0% 40.0% 40.0% 40.0%

Gross Profit $92.8 $99.5 $106.2 $112.1 $120.0 $126.0 $132.3 $138.9 $145.9
Gross Profit Margin % 58.0% 58.5% 59.0% 59.0% 60.0% 60.0% 60.0% 60.0% 60.0%

Depreciation $5.0 $5.0 $5.0 $5.0 $5.0 $6.7 $6.9 $7.1 $7.4
Amortization $0.0 $0.0 $0.0 $0.0 $0.0 $1.6 $1.6 $1.6 $1.6

SG&A Expenses $48.0 $51.0 $54.0 $57.0 $60.0 $63.0 $66.2 $69.5 $72.9
SG&A as % of Revenue 30.0% 30.0% 30.0% 30.0% 30.0% 30.0% 30.0% 30.0% 30.0%

Operating Income / EBIT $39.8 $43.5 $47.2 $50.1 $55.0 $54.7 $57.7 $60.7 $64.0
Operating Income / EBIT Margin % 24.9% 25.6% 26.2% 26.4% 27.5% 26.1% 26.1% 26.2% 26.3%

EBITDA $44.8 $48.5 $52.2 $55.1 $60.0 $63.0 $66.2 $69.5 $72.9
EBITDA Margin % 28.0% 28.5% 29.0% 29.0% 30.0% 30.0% 30.0% 30.0% 30.0%
EBITDA Growth na 8.1% 7.7% 5.6% 8.9% 5.0% 5.0% 5.0% 5.0%

Interest Expense $13.0 $18.0 $17.2 $16.4 $15.5 $22.8 $21.9 $21.1 $20.3
Interest Income $0.2 $0.0 $0.0 $0.0 $0.0 $0.0 $0.1 $0.2 $0.3
Net Interest Expense $12.8 $18.0 $17.2 $16.4 $15.5 $22.8 $21.8 $20.9 $20.0

Other Income / (Expense) $2.0 $0.0 ($2.0) $1.0 $0.0 $0.0 $0.0 $0.0 $0.0

Pretax Income $29.0 $25.4 $28.0 $34.7 $39.5 $31.9 $35.8 $39.8 $44.0

Taxes $11.6 $10.2 $11.2 $13.9 $15.8 $12.8 $14.3 $15.9 $17.6
Tax Rate 40.0% 40.0% 40.0% 40.0% 40.0% 40.0% 40.0% 40.0% 40.0%

Net Income $17.4 $15.3 $16.8 $20.8 $23.7 $19.2 $21.5 $23.9 $26.4
Net Margin % 10.9% 9.0% 9.3% 11.0% 11.9% 9.1% 9.7% 10.3% 10.9%
Net Income Growth na -12.3% 10.2% 23.7% 13.9% -19.2% 12.1% 11.2% 10.5%
(1) Excludes depreciation and amortization

Page 12
Project Echo - Financial Model - Working Version
Control Panel
All years balance OK OK OK OK OK OK OK
No negative cash balance OK OK OK OK OK OK OK

Historical Financial Statements Projected Financial Statements

($ in millions) Fiscal Year Ending December 31, Fiscal Year Ending December 31,
2017A 2018A 2019A 2020A 2021E 2021PF 2022P 2023P 2024P 2025P

Balance Sheet
Assets
Cash $5.0 $0.0 $0.0 $0.0 $0.0 $0.0 $3.4 $8.4 $16.0 $26.6
Accounts Receivable $12.0 $13.0 $14.0 $15.0 $16.0 $16.0 $17.5 $18.4 $19.3 $20.3
Inventory $8.0 $8.5 $9.0 $9.5 $10.0 $10.0 $10.5 $11.0 $11.6 $12.2
Other Current Assets $1.0 $1.0 $1.0 $1.0 $1.0 $1.0 $1.0 $1.0 $1.0 $1.0
Total Current Assets $26.0 $22.5 $24.0 $25.5 $27.0 $27.0 $32.4 $38.8 $47.9 $60.0

Gross PP&E $277.2 $287.2 $298.2 $310.2 $323.2 $323.2 $333.7 $344.7 $356.3 $368.5
Accumulated Depreciation $25.0 $30.0 $35.0 $40.0 $45.0 $45.0 $51.7 $58.6 $65.7 $73.1
Net PP&E $252.2 $257.2 $263.2 $270.2 $278.2 $278.2 $282.0 $286.2 $290.6 $295.4

Amortizable Intangibles $0.0 $0.0 $0.0 $0.0 $0.0 $8.0 $6.4 $4.8 $3.2 $1.6
Goodwill $5.0 $5.0 $5.0 $5.0 $5.0 $70.2 $70.2 $70.2 $70.2 $70.2
Total Assets $283.2 $284.7 $292.2 $300.7 $310.2 $383.4 $391.0 $399.9 $411.9 $427.2

Liabilities
Accounts Payable $8.5 $9.0 $9.5 $10.0 $11.0 $11.0 $11.7 $12.3 $12.9 $13.5
Accrued Liabilities $2.0 $2.1 $2.2 $2.3 $2.4 $2.4 $2.5 $2.6 $2.8 $2.9
Other Current Liabilities $1.0 $0.0 $2.0 $1.0 $0.0 $0.0 $1.7 $1.8 $1.9 $1.9
Total Current Liabilities $11.5 $11.1 $13.7 $13.3 $13.4 $13.4 $15.9 $16.7 $17.5 $18.4

Existing Debt
Revolving Credit Facility $13.3 $18.9 $28.0 $37.1 $40.8 $0.0 $0.0 $0.0 $0.0 $0.0
Term Loan $180.0 $160.0 $140.0 $120.0 $100.0 $0.0 $0.0 $0.0 $0.0 $0.0
Unsecured Debt $50.0 $50.0 $50.0 $50.0 $50.0 $0.0 $0.0 $0.0 $0.0 $0.0

New Debt
Revolving Credit Facility $0.0 $0.0 $0.0 $0.0 $0.0
Term Loan $120.0 $100.0 $80.0 $60.0 $40.0
Senior Bonds $90.0 $90.0 $90.0 $90.0 $90.0
Unsecured Debt $60.0 $66.0 $72.6 $79.9 $87.8

Other Liabilities $1.0 $2.0 $1.0 $0.0 $2.0 $2.0 $2.0 $2.0 $2.0 $2.0
Total Liabilities $255.8 $242.0 $232.7 $220.4 $206.2 $285.4 $273.9 $261.3 $249.4 $238.2

Shareholders Equity
Retained Earnings $17.4 $32.7 $49.5 $70.3 $94.0 ($6.0) $13.2 $34.7 $58.5 $84.9
Common Stock $10.0 $10.0 $10.0 $10.0 $10.0 $104.0 $104.0 $104.0 $104.0 $104.0
Total Shareholders Equity $27.4 $42.7 $59.5 $80.3 $104.0 $98.0 $117.2 $138.7 $162.5 $188.9

Total Liabilities and Equity $283.2 $284.7 $292.2 $300.7 $310.2 $383.4 $391.0 $399.9 $411.9 $427.2
Check $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0

Page 13
Project Echo - Financial Model - Working Version
Control Panel
All years balance OK OK OK OK OK OK OK
No negative cash balance OK OK OK OK OK OK OK

Historical Financial Statements Projected Financial Statements

($ in millions) Fiscal Year Ending December 31, Fiscal Year Ending December 31,
2017A 2018A 2019A 2020A 2021E 2021PF 2022P 2023P 2024P 2025P

Cash Flow
Net Income na $15.3 $16.8 $20.8 $23.7 $19.2 $21.5 $23.9 $26.4
Plus / (minus):
Depreciation and Amortization na $5.0 $5.0 $5.0 $5.0 $8.3 $8.5 $8.7 $9.0
PIK Interest $6.0 $6.6 $7.3 $8.0
Changes in Working Capital:
Accounts Receivable na ($1.0) ($1.0) ($1.0) ($1.0) ($1.5) ($0.9) ($0.9) ($1.0)
Inventory na ($0.5) ($0.5) ($0.5) ($0.5) ($0.5) ($0.5) ($0.6) ($0.6)
Other Current Assets na $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0
Accounts Payable na $0.5 $0.5 $0.5 $1.0 $0.7 $0.6 $0.6 $0.6
Accrued Liabilities na $0.1 $0.1 $0.1 $0.1 $0.1 $0.1 $0.1 $0.1
Other Current Liabilities na ($1.0) $2.0 ($1.0) ($1.0) $1.7 $0.1 $0.1 $0.1
Change in Other Liabilities na $1.0 ($1.0) ($1.0) $2.0 $0.0 $0.0 $0 $0
Cash Flow from Operations na $19.4 $21.9 $22.9 $29.3 $33.9 $36.0 $39.2 $42.7

Cash Flow from Investing

Capital Expenditures na ($10.0) ($11.0) ($12.0) ($13.0) ($10.5) ($11.0) ($11.6) ($12.2)
Asset Dispositions na $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0
Cash Flow from Investing na ($10.0) ($11.0) ($12.0) ($13.0) ($10.5) ($11.0) ($11.6) ($12.2)

Cash Flows from Financing

Change in Revolver na $5.6 $9.1 $9.1 $3.7 $0.0 $0.0 $0.0 $0.0
Change in Term Loan na ($20.0) ($20.0) ($20.0) ($20.0) ($20.0) ($20.0) ($20.0) ($20.0)
Change in Senior Bonds $0.0 $0.0 $0.0 $0.0
Change in Unsecured Debt na $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0
Cash Flow from Financing na ($14.4) ($10.9) ($10.9) ($16.3) ($20.0) ($20.0) ($20.0) ($20.0)

Net Cash Flow na ($5.0) $0.0 $0.0 $0.0 $3.4 $5.0 $7.7 $10.5

Beginning Cash Position na $5.0 $0.0 $0.0 $0.0 $0.0 $3.4 $8.4 $16.0
Change in Cash Position na ($5.0) $0.0 $0.0 $0.0 $3.4 $5.0 $7.7 $10.5
Ending Cash Position na $0.0 $0.0 $0.0 $0.0 $3.4 $8.4 $16.0 $26.6

Page 14
Project Echo - Financial Model - Working Version
Control Panel
All years balance OK OK OK OK OK OK OK
No negative cash balance OK OK OK OK OK OK OK

Historical Financial Statements Projected Financial Statements

($ in millions) Fiscal Year Ending December 31, Fiscal Year Ending December 31,
2017A 2018A 2019A 2020A 2021E 2021PF 2022P 2023P 2024P 2025P
Cash Flow Before Revolver ($5.6) ($9.1) ($9.1) ($3.7) $3.4 $8.4 $16.0 $26.6
Debt and Interest Schedule
Revolver
Beginning Revolver Balance $13.3 $18.9 $28.0 $37.1 $0.0 $0.0 $0.0 $0.0
(Paydown) / Drawdown $5.6 $9.1 $9.1 $3.7 $0.0 $0.0 $0.0 $0.0
Ending Revolver Balance $18.9 $28.0 $37.1 $40.8 $0.0 $0.0 $0.0 $0.0
Interest Rate 6.0% 6.0% 6.0% 6.0% 7.00% 7.00% 7.00% 7.00%
Interest Expense $1.0 $1.4 $2.0 $2.3 $0.0 $0.0 $0.0 $0.0

Term Loan
Term Loan Beginning Balance $180.0 $160.0 $140.0 $120.0 $120.0 $100.0 $80.0 $60.0
(Paydown) / Drawdown ($20.0) ($20.0) ($20.0) ($20.0) ($20.0) ($20.0) ($20.0) ($20.0)
Term Loan Ending Balance $160.0 $140.0 $120.0 $100.0 $100.0 $80.0 $60.0 $40.0
Interest Rate 6.50% 6.50% 6.50% 6.50% 7.50% 7.50% 7.50% 7.50%
Interest Expense $11.1 $9.8 $8.5 $7.2 $8.3 $6.8 $5.3 $3.8

Senior Bonds
Senior Bonds Beginning Balance $90.0 $90.0 $90.0 $90.0
(Paydown) / Drawdown $0.0 $0.0 $0.0 $0.0
Senior Bonds Ending Balance $90.0 $90.0 $90.0 $90.0
Interest Rate - Cash 9.50% 9.50% 9.50% 9.50%
Interest Expense - Cash $8.55 $8.55 $8.55 $8.55
Interest Rate - PIK 0.00% 0.00% 0.00% 0.00%
Interest Expense - PIK $0.00 $0.00 $0.00 $0.00

Unsecured Debt
Unsecured Debt Beginning Balance $50.0 $50.0 $50.0 $50.0 $60.0 $66.0 $72.6 $79.9
(Paydown) / Drawdown $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0
Unsecured Debt Ending Balance $50.0 $50.0 $50.0 $50.0 $66.0 $72.6 $79.9 $87.8
Interest Rate - Cash 12% 12% 12% 12% 0.00% 0.00% 0.00% 0.00%
Interest Expense - Cash $6.0 $6.0 $6.0 $6.0 $0.0 $0.0 $0.0 $0.0
Interest Rate - PIK 10.00% 10.00% 10.00% 10.00%
Interest Expense - PIK $6.0 $6.6 $7.3 $8.0

Total Cash Interest Exp. $16.8 $15.3 $13.8 $12.3

Total Interest Expense $18.0 $17.2 $16.4 $15.5 $22.8 $21.9 $21.1 $20.3

Interest Earned on Cash $0.0 $0.0 $0.0 $0.0 $0.0 $0.1 $0.2 $0.3

Page 15
ncial Statements
ng December 31,
2026P

$255.3
5.0%

$102.1
40.0%

$153.2
60.0%

$7.6
$1.6

$76.6
30.0%

$67.4
26.4%

$76.6
30.0%
5.0%

$18.8
$0.4
$18.4

$0.0

$48.9

$19.6
40.0%

$29.4
11.5%
11.2%

Page 16
ncial Statements
ng December 31,
2026P

$20.5
$21.3
$12.8
$1.0
$55.5

$381.2
$80.7
$300.5

$0.0
$70.2
$426.2

$14.2
$3.1
$2.0
$19.3

$0.0
$0.0
$0.0

$0.0
$0.0
$90.0
$96.6

$2.0
$207.9

$114.3
$104.0
$218.3

$426.2
$0.0

Page 17
ncial Statements
ng December 31,
2026P

$29.4

$9.2
$8.8

($1.0)
($0.6)
$0.0
$0.7
$0.1
$0.1
$0
$46.7

($12.8)
$0.0
($12.8)

$0.0
($40.0)
$0.0
$0.0
($40.0)

($6.1)

$26.6
($6.1)
$20.5

Page 18
ncial Statements
ng December 31,
2026P
$20.5

$0.0
$0.0
$0.0
7.00%
$0.0

$40.0
($40.0)
$0.0
7.50%
$1.5

$90.0
$0.0
$90.0
9.50%
$8.55
0.00%
$0.00

$87.8
$0.0
$96.6
0.00%
$0.0
10.00%
$8.8

$10.1
$18.8

$0.4

Page 19