On November 1, 2024 (the “Closing Date”), the Company completed the acquisition of Nu Aire, Inc. ("Nu Aire"), a leading manufacturer of equipment for a diverse range of laboratory and pharmacy environments, by acquiring all of the Nu Aire capital stock that was issued and outstanding as of the date of acquisition (the "Transaction"). The Transaction expands the Company's capabilities, allowing the combined organization to better meet the needs of end-users in laboratory furnishings and accelerates the Company's vision of becoming the market leader in the design and manufacturing of laboratory furniture and technical products essential for outfitting laboratories.

The Company purchased all the outstanding stock of Nu Aire for $55.0 million, subject to certain adjustments for debt, cash, transaction expenses, and net working capital resulting in aggregate acquisition consideration of $53.0 million as shown in the table below. $23.0 million of the purchase price payable at closing of the Transaction was funded pursuant to subordinated seller notes. The remaining purchase price payable at closing of the Transaction was paid in cash, which cash was funded, in part, through the Revolving Credit Facility (as defined in Note H, Long-term Debt and Other Credit Arrangements), and Term Loan (as defined in Note H, Long-term Debt and Other Credit Arrangements), provided to the Company by PNC Bank, National Association ("PNC").


($ in thousands)
Cash paid to Nu Aire	$	29,669
Subordinated Promissory Notes due to Nu Aire	23,000
Payment of Nu Aire transaction expenses	311
Purchase Price	$	52,980

The Transaction was accounted for as a business combination using the acquisition method of accounting in accordance with ASC 805, Business Combinations. The purchase price was allocated to the assets acquired and liabilities assumed based on the estimated fair values at the date of acquisition. The excess of the purchase price over the fair value of the net assets acquired was allocated to goodwill, none of which is expected to be deductible for tax purposes. Goodwill arising from the Transaction is attributable to the value of the acquired assembled workforce and the premium paid.


($ in thousands)	Final Allocation As Adjusted
Assets acquired:
Cash and cash equivalents	$	1,245
Receivables	10,650
Inventories	15,522
Prepaid expenses and other current assets	852
Property, plant and equipment	7,349
Other intangible assets	18,600
Goodwill	12,487
Right of use assets	7,376
Other assets	7
Total assets acquired	74,088

Liabilities assumed:
Current portion of operating lease liabilities	(965)
Accounts payable	(4,318)
Employee compensation and amounts withheld	(2,642)
Deferred revenue	(935)
Other accrued expenses	(1,591)
Long-term portion of operating lease liabilities	(5,167)
Deferred income taxes	(5,490)
Total liabilities assumed	(21,108)
Aggregate acquisition consideration	$	52,980

The purchase price allocation was finalized as of July 31, 2025, within the measurement period, and no further adjustments will be made. During the year ended April 30, 2025, the Company recorded a $1.8 million measurement period adjustment to increase inventory as a result of revised capitalized variances related to work-in-progress as of the acquisition date, with a corresponding decrease to Goodwill, net of the tax impact. The net effect of these adjustments would have resulted in an insignificant decrease in cost of products sold recorded during the year ended April 30, 2025. The measurement period adjustments were recorded in our consolidated financial statements as of and for the year ended April 30, 2025.

The above fair values of assets acquired and liabilities assumed are based on the information that was available as of the reporting date. The fair values of the assets acquired and liabilities assumed were determined using the income and cost approaches. In many cases, the determination of the fair values required estimates about discount rates, future expected cash flows and other future events that are judgmental and subject to change. The fair value measurements were primarily based on

significant inputs that are not observable in the market and thus represent a Level 3 measurement of the fair value hierarchy as defined in ASC 820, Fair Value Measurements. Intangible assets consisting of customer relationships, trade names and trademarks, and developed technology were valued using the multi-period excess earnings method ("MEEM"), or the relief from royalty ("RFR") method, both are forms of the income approach. A cost approach was applied for property, plant and equipment.

•Customer relationship intangible assets were valued using the MEEM method. The significant assumptions used include the estimated annual net cash flows (including appropriate revenue and profit attributable to the asset, customer attrition rates, applicable tax rate, and contributory asset charges, among other factors), the discount rate reflecting the risks inherent in the future cash flow stream, an assessment of the asset's life cycle and the tax amortization benefit, among other factors.

•The trade names and trademarks and developed technology intangible assets were valued using the RFR method. The significant assumptions used include the estimated annual net cash flows (including appropriate revenue attributable to the asset, applicable tax rate, royalty rate, and other factors such as technology related obsolescence rates), the discount rate, reflecting the risks inherent in the future cash flow stream, and the tax amortization benefit, among other factors.

•The cost approach, which estimates value by determining the current cost of replacing an asset with another of equivalent economic utility, was used for property, plant, and equipment. The cost to replace a given asset reflects the estimated reproduction or replacement cost for the property, less an allowance for loss in value due to depreciation.

The Company believes that the information provided a reasonable basis for estimating the fair values of the acquired assets and assumed liabilities and considers the purchase price allocation finalized as of July 31, 2025, within the measurement period.

($ in thousands)

Fair Value

Estimated Useful Life

Customer relationships

9,800

10 years

Trade names and trademarks

4,900

indefinite

Developed technology

3,900

7 years

Intangible assets acquired

18,600

The results of operations for Nu Aire of $19.7 million of revenue and $696,000 of net earnings for the three months ended July 31, 2025, have been included within the accompanying Consolidated Statements of Operations.

The following unaudited supplemental pro forma combined financial information presents the Company's results of operations for the three months ended July 31, 2024 as if the acquisition of Nu Aire had occurred on May 1, 2023. The pro forma financial information is presented for comparative purposes only and is not necessarily indicative of the Company's operating results that may have actually occurred had the acquisition of Nu Aire been completed on May 1, 2023. In addition, the unaudited pro forma financial information does not give effect to any anticipated cost savings, operating efficiencies, or other synergies that may be associated with the Transaction, or any estimated costs that have been or will be incurred by the Company to integrate the assets and operations of Nu Aire.


	Three Months Ended July 31,
($ in thousands, except per share amounts)	2025		2024
	(actual)		(pro forma)
Net sales	$	71,104	$	65,448
Net earnings	$	3,093	$	4,273
Net earnings per share attributable to Kewaunee Scientific Corporation stockholders:
Basic	$	1.08	$	1.50
Diluted	$	1.04	$	1.44