Royston deal boosts LSI Industries (NASDAQ: LYTS) scale and margins

Rhea-AI Filing Summary

LSI Industries Inc. agreed to acquire Royston Group for $325 million, with $320 million in cash and $5 million in LSI common stock, subject to a working capital adjustment. Royston will merge into a wholly owned LSI subsidiary, with Royston surviving.

LSI obtained a commitment for a new $425 million senior secured credit facility from PNC, including term loans and a revolving line, to help fund the deal, and expects closing in the third quarter of its 2026 fiscal year, subject to antitrust clearance and other conditions. Royston generated about $272 million of revenue and $38 million of adjusted EBITDA in the twelve months ended September 30, 2025, implying combined pro forma revenue of roughly $864 million and adjusted EBITDA of about $95 million.

Positive

• Transformational scale and margin uplift: Royston adds roughly $272 million of revenue and $38 million of adjusted EBITDA (TTM September 2025), taking pro forma revenue to about $864 million and adjusted EBITDA to roughly $95 million, and is expected to be accretive to margin rate and diluted EPS at closing.

Negative

• None.

Insights

Equity and M&A analyst

Transformational, accretive acquisition that increases scale and leverage.

LSI Industries is buying Royston Group for $325 million, adding a vertically integrated retail fixtures and signage platform with trailing twelve‑month revenue of $272 million and adjusted EBITDA of $38 million. Pro forma, LSI cites combined revenue of $864 million and adjusted EBITDA of about $95 million, with Royston’s 14% EBITDA margin lifting group profitability.

Financing relies heavily on debt via a committed $425 million senior secured credit facility from PNC, plus an equity component, and management expects net leverage of roughly 3.0x at closing. The agreement includes customary closing conditions such as Hart‑Scott‑Rodino clearance and a “Material Adverse Effect” condition, and an outside date of May 29, 2026 after which either party can terminate, highlighting regulatory and execution risk.

LSI describes the deal as accretive to margin rate and diluted EPS upon closing and points to commercial synergies in core verticals like refueling, convenience, grocery, and QSR. Integration risk is meaningful given Royston’s scale and international footprint, but LSI has recently integrated other acquisitions and provides detailed pro forma financials and extensive risk factors to frame potential outcomes.

false 0000763532 0000763532 2026-02-20 2026-02-20

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of Report (Date of earliest event reported) February 20, 2026

LSI INDUSTRIES INC.

(Exact name of Registrant as Specified in its Charter)

Ohio		01-13375		31-0888951
(State or Other Jurisdiction of Incorporation)		(Commission File Number)		(IRS Employer Identification No.)

10000 Alliance Road, Cincinnati, Ohio	45242
(Address of Principal Executive Offices)	(Zip Code)

Registrant’s telephone number, including area code (513) 793-3200

(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

	Title of each class	Trading Symbol(s)	Name of each exchange on which registered
	Common Stock, no par value	LYTS	NASDAQ

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (17CFR §240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act ☐

Item 1.01 Entry into a Material Definitive Agreement.

On February 20, 2026, LSI Industries Inc. (“LSI” or the “Company”) entered into an Agreement and Plan of Merger (the “Merger Agreement”) with SRR Holdings, Inc., a Delaware corporation (“Royston”), and Rhino Acquisition Company, Inc., a Delaware corporation and a wholly-owned direct subsidiary of the Company (the “Merger Sub”), pursuant to which LSI, through Merger Sub, agreed to merge with and into Royston, with Royston surviving (the “Merger”). The Merger Agreement provides for an aggregate purchase price of $325 million, subject to a working capital adjustment, with $320 million of the purchase price payable in cash at closing and the remaining $5 million payable in the issuance of the Company’s common stock, valued as of the closing price of the Company’s common stock on February 19, 2026. The completion of the Merger is subject to various closing conditions, including (a) the expiration or termination of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended; (b) the absence of any applicable order (whether temporary, preliminary or permanent) in effect which prohibits the consummation of the Merger; and (c) the absence of a Material Adverse Effect (as defined in the Merger Agreement) since the date of the Merger Agreement. The transaction is expected to close in the third quarter of LSI’s 2026 fiscal year.

The Company has a $125 million secured revolving line of credit (the “Revolving Line of Credit”) with PNC Capital Markets LLC and PNC Bank, National Association (together, “PNC”). The Revolving Line of Credit expires in the first quarter of fiscal 2031. As of December 31, 2025, $104.6 million of the credit line was available. 

The Company has obtained a debt financing commitment from PNC to amend the Revolving Line of Credit to increase the amount available under the Revolving Line of Credit to $425 million, which will be issued subject to market conditions and other factors (the “Proposed Senior Secured Credit Facility”) and intends to fund the consideration and related transaction costs under the Merger Agreement with the Proposed Senior Secured Credit Facility. However, the consummation of the Merger is not subject to any financing condition.

Under the Proposed Senior Secured Credit Facility, the Company will be able to borrow up to $425 million, consisting of a $200 million five-year term loan, a $75 million one-year term loan, and a $150 million revolving credit facility. The Proposed Senior Secured Credit Facility will expire on or around March 31, 2031. Interest on the Proposed Senior Secured Credit Facility is expected to be based on, at the Company’s option, the Secured Overnight Financing Rate or a customary base rate, to be determined by reference to customary market benchmarks; in each case plus an applicable margin that is anticipated to vary based on the Company’s total leverage ratio. The obligations of the Company and its subsidiary guarantors will be secured by substantially all of the personal property of the Company and its subsidiaries. The Company’s guarantors will include all existing and future domestic wholly-owned subsidiaries. The Company will also be subject to a fee on the unused balance of the Proposed Senior Secured Credit Facility, expected to be initially 27.5 basis points. The Company will also have an option to increase a portion of the Proposed Senior Secured Credit Facility by an amount up to $75 million. A portion of the revolver of the Proposed Senior Secured Credit Facility not in excess of $15 million shall be available for the advancement of swingline loans.

Royston has made customary representations, warranties and covenants in the Merger Agreement, including, among others, and subject to certain exceptions, covenants to use reasonable best efforts to conduct its business in all material respects in the ordinary course of business during the period between the signing of the Merger Agreement and the closing of the Merger, not to engage in specified types of actions during this period, and not to solicit or negotiate alternative proposals.

The Merger Agreement contains certain termination rights, including that either party may terminate the Merger Agreement if, subject to certain limitations, the Merger has not closed by May 29, 2026 (the “Outside Date”).

The foregoing description of the Merger Agreement does not purport to be complete and is qualified in its entirety by reference to the Merger Agreement, which is filed as Exhibit 2.1 to this Current Report on Form 8-K and incorporated herein by reference.

The Merger Agreement has been included to provide investors with information regarding its terms. It is not intended to provide any other factual information about the Company, Royston or any of their respective affiliates. The representations, warranties and covenants contained in the Merger Agreement were made only for purposes of the Merger Agreement as of the specific date therein, were solely for the benefit of the parties to the Merger Agreement, may be subject to limitations agreed upon by the contracting parties, including being qualified by confidential disclosures made for the purposes of allocating contractual risk among the parties to the Merger Agreement instead of establishing these matters as facts, and may be subject to standards of materiality applicable to the contracting parties that differ from those applicable to investors. Investors are not third-party beneficiaries under the Merger Agreement and should not rely on the representations, warranties and covenants or any descriptions thereof as characterizations of the actual state of facts or condition of the parties thereto or any of their respective subsidiaries or affiliates. Moreover, information concerning the subject matter of representations and warranties may change after the date of the Merger Agreement, which subsequent information may or may not be fully reflected in the Company’s public disclosures. The Merger Agreement should not be read alone, but should instead be read in conjunction with the other information regarding the parties that is or will be contained in, or incorporated by reference into, the Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and other documents that the Company filed or will file with the Securities and Exchange Commission (“SEC”).

Item 7.01.Regulation FD Disclosure.

On February 25, 2026, the Company issued a press release announcing the execution of the Merger Agreement. The press release is attached hereto as Exhibit 99.1 and incorporated by reference herein.

On February 26, 2026, the Company is hosting a conference call for the benefit of its investors to discuss the Merger. The Company’s investor presentation containing additional information regarding the Merger is attached hereto as Exhibit 99.2 and incorporated by reference herein. Additional information regarding the Merger is included in Exhibit 99.3.

The information in this Item 7.01, including the exhibits referenced herein and attached hereto, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), nor shall they be deemed incorporated by reference in any Company filing under the Securities Act of 1933, as amended (the “Securities Act”) or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

Cautionary Language Concerning Forward-Looking Statements

This report contains certain forward-looking statements that are subject to numerous assumptions, risks or uncertainties.  The Private Securities Litigation Reform Act of 1995 provides a safe harbor for forward-looking statements.  Forward-looking statements may be identified by words such as “estimates,” “anticipates,” “projects,” “plans,” “expects,” “intends,” “believes,” “seeks,” “may,” “will,” “should” or the negative versions of those words and similar expressions, and by the context in which they are used.  Examples of forward-looking statements include, among others, statements regarding the proposed Merger, including the timing of the proposed Merger and the source of the funds to be used as consideration for the proposed Merger. Such statements, whether expressed or implied, are based upon current expectations of the Company and speak only as of the date made.  Actual results could differ materially from those contained in or implied by such forward-looking statements as a result of a variety of risks and uncertainties over which the Company may have no control.  These risks and uncertainties include, but are not limited to, risks that the benefits from the transaction may not be fully realized or may take longer to realize than expected, including as a result of changes in general economic and market conditions, interest and exchange rates, monetary policy, laws and regulations and their enforcement, and the degree of competition in the geographic and business areas in which LSI and Royston operate; uncertainties regarding the ability of LSI and Royston to promptly and effectively integrate their businesses; uncertainties regarding the reaction to the transaction of the companies’ respective customers, employees, and counterparties; and risks relating to the diversion of management time on transaction-related issues.  In addition to the factors described in this paragraph, the risk factors identified in the Company’s Annual Report on Form 10-K and other filings the Company may make with the SEC constitute risks and uncertainties that may affect the financial performance of the Company and are incorporated herein by reference.  The Company does not undertake and hereby disclaims any duty to update any forward-looking statements to reflect subsequent events or circumstances.

Item 8.01. Other Events

On September 12, 2025, LSI filed with the SEC a registration statement on Form S-3 for the purpose of registering the shares of common stock identified in the preliminary prospectus supplement LSI filed on February 25, 2026. Risk Factors related to Royston, the Merger, and the combined company, Business about Royston and Certain Information About Royston (the “Royston Business Section”), as well as Royston’s Management’s Discussion and Analysis of Financial Condition and Results of Operations of Royston as of and for the years ended December 31, 2024 and December 31, 2023 and for the nine month periods ended September 30, 2025 and September 30, 2024 are attached hereto as Exhibits 99.4, 99.5 and 99.6, respectively, and incorporated herein by reference.

The audited financial statements of Royston for the years ended December 31, 2024 and December 31, 2023, the unaudited financial statements of Royston for the nine months ended September 30, 2025 and September 30, 2024, and the unaudited pro forma condensed combined financial statements (and related notes) of the Company as of and for the six months ended December 31, 2025 and the fiscal year ended June 30, 2025 are attached hereto as Exhibits 99.7, 99.8 and 99.9, respectively, and incorporated herein by reference. The unaudited pro forma condensed combined financial statements are based on the Company’s audited and unaudited interim historical consolidated financial statements and Royston’s audited and unaudited interim historical financial statements as adjusted to give effect to the Company’s acquisition of Royston. The unaudited pro forma condensed combined balance sheet as of December 31, 2025 gives effect to these transactions as if they occurred on December 31, 2025. The unaudited pro forma condensed combined statements of operations for the six months ended December 31, 2025 and the fiscal year ended June 30, 2025 give effect to these transactions as if they occurred on July 1, 2024.

No Offer or Solicitation

This communication shall not constitute an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. No offering of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act.

Item9.01 Financial Statements and Exhibits.

(d) Exhibits

ExhibitNo.	Description
2.1	Agreement and Plan of Merger dated February 20, 2026 by and among LSI Industries Inc., SRR Holdings, Inc. and Rhino Acquisition Corp.*
23.1	Consent of Grant Thornton LLP
99.1	LSI Press Release dated February 25, 2026
99.2	Investor Presentation
99.3	The Royston Acquisition
99.4	Risk Factors related to Royston and the Merger, and the combined company
99.5	Royston Business Section
99.6	Management’s Discussion and Analysis of Financial Condition and Results of Operations of SRR Holdings, Inc. as of and for the years ended December 31, 2024 and 2023 and for the nine months periods ended September 30, 2025 and 2024.
99.7	Audited Financial Statements of SRR Holdings, Inc. for the years ended December 31, 2024 and December 31, 2023.
99.8	Unaudited financial statements of SRR Holdings, Inc. for the nine months ended September 30, 2025 and September 30, 2024.
99.9	Unaudited proforma condensed combined financial statements (and related notes) of LSI as of and for the six months ended December 31, 2025 and fiscal year ended June 30, 2025.
104	Cover Page Interactive Data File (embedded within the Inline XBRL document)

*Certain portions of this exhibit have been omitted pursuant to Item 601(a)(5) and Item 602(b)(2) of Regulation S-K. The Company agrees to furnish supplementally a copy of any omitted materials to the SEC upon its request.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

LSI INDUSTRIES INC.

BY:/s/ James E. Galeese

James E. Galeese

Executive Vice President, Chief Financial Officer

Dated: February 25, 2026

Exhibit 99.1

LSI INDUSTRIES TO ACQUIRE ROYSTON GROUP, CREATING AN

INTEGRATED RETAIL BRANDING SOLUTIONS PLATFORM OF SCALE

Transformational platform acquisition positions LSI as the market-leader within branded retail solutions

Expands LSI’s presence within new display solutions categories, accelerates growth in core vertical markets

LSI to host transaction conference call and live webcast on Thursday, February 26 at 8:30 a.m. ET

CINCINNATI, February 25, 2026 -- LSI Industries Inc. (Nasdaq: LYTS, “LSI” or the “Company”) a leading U.S. based manufacturer of commercial lighting and display solutions, today announced that it has entered into a definitive agreement to acquire privately held Royston Group (“Royston”), a leader in identity and equipment solutions for retail environments, from Industrial Opportunity Partners (“IOP”) for an aggregate purchase price of $325 million, subject to a working capital adjustment, with $320 million of the purchase price payable in cash at closing and the remaining $5 million payable in the issuance of shares of the Company’s common stock, valued as of the closing price of the Company’s common stock on February 19, 2026. The transaction is subject to Hart-Scott-Rodino clearance and is expected to close in the third quarter of LSI’s 2026 fiscal year.

Atlanta-based Royston is a vertically integrated provider of custom store fixtures, internal/external signage, and refrigerated/heated case displays. Through five facilities in four U.S. states, Royston offers customers a build-to-order solution that integrates design, engineering, fabrication, assembly, distribution and turnkey installation capabilities that span the full project lifecycle.

Royston provides retail branding solutions across an array of growing, high-value vertical markets, including refueling/c-store, grocery, and quick-serve restaurant (“QSR”), among others, where LSI has an established market presence. Royston is an established partner of choice for three of the top five U.S. c-store and grocery chains, and four of the top five U.S. refueling station chains by location count.

Royston, and its nearly 900 employees, will become part of LSI’s display solutions segment on a reporting basis upon the closing of the transaction.

MANAGEMENT COMMENTARY

“We believe the acquisition of Royston will be a transformational transaction for our business, customers, and shareholders, positioning LSI as the leading scaled platform in branded retail solutions,” stated James A. Clark, President and Chief Executive Officer of LSI. “LSI is building an integrated, new-to-market offering that provides a one-stop, solutions-based approach to support the new build and remodel programs of leading global retail companies across North America. This transaction accelerates our growth across targeted vertical markets, expands our suite of solutions within higher margin product categories, and further entrenches LSI as the partner of choice for leading retail brands.”

LSI Industries to Acquire Royston Group

February 25, 2026

“Royston has established long-term customer relationships with many of the leading regional and national refueling, grocery, and QSR chains in the United States,” continued Clark. “Among its top 10 customers by revenue, the average relationship exceeds 20 years, which we believe reflects its position as a go-to partner for store remodels, which accounts for approximately 70% of Royston’s annual revenue.”

“Upon closing of the transaction, we expect our consolidated sales to customers in the refueling, grocery, and QSR markets to represent more than 60% of pro-forma annual revenue, with minimal customer overlap across the combined portfolio,” continued Clark. “Given the attractive growth profiles of these vertical markets, we believe this acquisition enhances our ability to deliver revenue growth that outpaces the broader commercial and industrial sectors in which we operate.”

“The addition of Royston will expand LSI’s capabilities within new, high-value product lines, including internal and external signage, while strengthening our existing offerings in store fixtures and display cases,” continued Clark. “We believe this transaction offers significant commercial synergy potential, positioning us to expand per-site content through cross-selling and a solutions-based value proposition.”

“As previously outlined within our Fast Forward value creation strategy, we believe the acquisition of Royston positions LSI to deliver on its financial targets two years ahead of plan, with pro-forma TTM September 2025 combined revenue for LSI-Royston of approximately $864 million and adjusted EBITDA of approximately $95 million.”

“At closing, we anticipate net leverage to approximate 3.0x and remain committed to further deleveraging over the near-to-medium term, while continuing to reinvest in the organic growth of the combined business,” continued Clark.

“Over the last five years, with the acquisitions of JSI, EMI, Canada’s Best and now Royston, we’ve demonstrated a focused approach toward value creation through accretive, complementary acquisitions, while delivering consistent organic growth, margin discipline, and profitability within our base business,” stated Clark. “After the closing of the Royston transaction, we intend to update our long-term financial targets as we introduce the next phase of our Fast Forward plan, highlighting the value compounding power we anticipate from the combined businesses.”

“LSI is building the leading retail branding solutions platform in North America, with a strategic focus and proven track record of long-term value creation that aligns closely with our own,” stated Frank Callis, President and CEO of Royston Group. “This transaction brings together highly complementary capabilities and customer relationships, expanding the breadth of integrated solutions we can deliver across retail environments. We look forward to joining the LSI team as we contribute to the profitable growth of the combined organization.”

“We are pleased to welcome the entire Royston team to the LSI family,” concluded Clark. “Our shared cultural focus on innovation, customer service, quality, operational discipline, and a returns-focused approach to capital allocation position LSI for continued success as together, we build the leading platform for growth within the branded retail marketing solutions space.”

Page 2 of 6

LSI Industries to Acquire Royston Group

February 25, 2026

TRANSACTION DETAILS

In TTM September 2025, Royston generated total revenue of approximately $272 million and adjusted EBITDA of approximately $38 million⁽¹⁾, or 14.0% of revenue.

The transaction price represents 8.1x⁽¹⁾ TTM September 2025 adjusted EBITDA, based on a combination of the purchase price of $325 million and net of tax benefits transferring to LSI. The acquisition of Royston is expected to be accretive to LSI on both a margin rate and diluted earnings per share basis upon the closing of the transaction. The acquisition is supported by a fully committed bridge facility. Permanent financing is expected to include a mix of equity and debt financing.

COMPELLING TRANSACTION RATIONALE

● Creates a scaled, integrated retail solutions platform. LSI believes that the combination of LSI-Royston will create a leading solutions-based business that integrates custom design, engineering, manufacturing, installation and maintenance capabilities across lighting, fixtures, branded signage, and display cases, establishing a one-stop partner for leading retail brands.

● Strengthens leadership in core vertical markets.  On a pro-forma basis, approximately 60% of the combined LSI-Royston sales will be from the refueling, grocery and c-store markets, positioning the go-forward platform as a significant partner of scale to both regional and national retail chains. The two companies serve largely distinct customer bases, with minimal overlap between their respective customer relationships despite a shared vertical market focus.

● Expands domestic manufacturing footprint in strategic locations. The addition of Royston’s five domestic facilities will increase LSI’s operational footprint from 18 to 23 locations, resulting in a nearly 40% increase in manufacturing square footage capacity to support organic growth.

● Recurring revenue model supported by long-term customer relationships. Royston serves many of the leading retail brands in North America, including customers operating thousands of serviceable locations.  In fiscal year 2025, approximately 70% of revenue for the core Royston business was generated from remodel projects, with the remaining 30% from new store construction, creating a durable revenue base tied to recurring store refresh cycles. The average tenure of Royston’s top 10 customers exceeds 20 years.

● Meaningful cross-selling opportunities. Approximately 47% of Royston’s customers currently purchase a single product from them, creating meaningful opportunities to expand share of wallet across the combined offering, which includes LSI’s branded lighting solutions. LSI also expects to leverage Royston’s expanded capabilities within its legacy customer base, resulting in compelling commercial synergies across the combined businesses.

● Improved pro-forma margin profile.  In TTM September 2025, LSI generated adjusted EBITDA of 9.7%, while Royston generated adjusted EBITDA margin of 14.0%. On a pro-forma basis for fiscal year 2025, the combined businesses generated adjusted EBITDA margin of 11.0%, approaching the adjusted EBITDA margin target outlined in LSI’s Fast Forward value creation strategy.

Page 3 of 6

LSI Industries to Acquire Royston Group

February 25, 2026

● Pathway to reduce leverage meaningfully, over the medium-term.  At transaction closing, LSI anticipates a pro-forma net debt / adjusted EBITDA ratio for the combined entity of at or below approximately 3.0x and expects to reduce net leverage to at-or-below 2.0x by year-end fiscal 2028, consistent with its track record of programmatic de-leveraging following the completion of prior acquisitions.

(1) LSI estimates based on pro forma financial information. Results cannot be guaranteed.

LSI INDUSTRIES’ ACQUISITION OF ROYSTON GROUP

A conference call will be held tomorrow, February 26, 2026, at 8:30 a.m. ET to review LSI’s acquisition of Royston Group.

A webcast of the conference call and accompanying presentation materials will be available in the Investor Relations section of LSI Industries’ website at www.lsicorp.com. Individuals can also participate by teleconference dial-in. To listen to a live broadcast, go to the site at least 15 minutes prior to the scheduled start time to register, download and install any necessary audio software.

Details of the conference call are as follows:

Live Call Dial-In: 877-407-9208

To listen to a replay of the teleconference, which subsequently will be available through March 12, 2026.

Call Replay:	844-512-2921
Replay ID:	13758950

ABOUT LSI INDUSTRIES         

Headquartered in Cincinnati, LSI is a publicly held company traded over the NASDAQ Stock Exchange under the symbol LYTS. The Company manufactures advanced lighting, graphics, and display solutions across strategic vertical markets. The Company’s American-made products, which include non-residential indoor and outdoor lighting, print graphics, digital graphics, refrigerated and custom displays, help create value for customer brands and enhance the consumer experience. LSI also provides comprehensive project management services in support of large-scale product rollouts. The Company employs approximately 2,000 people at 19 manufacturing plants in the U.S. and Canada. Additional information about LSI is available at www.lsicorp.com.

ABOUT ROYSTON GROUP

Royston Group is a leader in complete identity and equipment solutions. Its portfolio of companies includes Royston LLC, SignResource, and Southern CaseArts – industry leaders in the outfitting of retail environments from casework, merchandisers, and refrigerated cases to exterior store signage.

Page 4 of 6

LSI Industries to Acquire Royston Group

February 25, 2026

Non-GAAP Financial Measures

This press release includes non-GAAP financial measures, including Earnings Before Interest, Taxes, Depreciation and Amortization EBITDA and Adjusted EBITDA. We believe that these are useful as supplemental measures in assessing the operating performance of our business. These measures are used by our management, including our chief operating decision maker, to evaluate business results, and are frequently referenced by those who follow LSI. These non-GAAP measures may be different from non-GAAP measures used by other companies. In addition, the non-GAAP measures are not based on any comprehensive set of accounting rules or principles. Non-GAAP measures have limitations, in that they do not reflect all amounts associated with our results as determined in accordance with U.S. GAAP. Therefore, these measures should be used only to evaluate our results in conjunction with corresponding GAAP measures. Below is a reconciliation of these non-GAAP measures reported for the periods indicated.

(Unaudited) (In thousands)		Twelve Months Ended September 30, 2025
		LSI				Royston				Combined
Net sales		$	592,531			$	271,827			$	864,358
Net Income to Adjusted EBITDA
Net Income		$	24,965			$	19,048			$	44,013
Income tax			9,451				(4,416	)			5,035
Interest expense, net			3,001				8,050				11,051
Other (income) expense			193				(177	)			16
Operating Income		$	37,610			$	22,505			$	60,115
Depreciation and amortization			12,835				12,148				24,983
EBITDA		$	50,445			$	34,653			$	85,098
Long-term performance based compensation			5,037				-				5,037
Professional fees and expenses			81				770				851
Acquisition costs			1,219				-				1,219
Expense on step-up basis of acquired lease			357				-				357
Private Equity Management Fees			-				756				756
Severance costs and Restructuring costs			169				1,850				2,019
Adjusted EBITDA		$	57,308			$	38,029			$	95,337
Adjusted EBITDA as a percentage of sales			9.7	%			14.0	%			11.0	%

Page 5 of 6

LSI Industries to Acquire Royston Group

February 25, 2026

FORWARD-LOOKING STATEMENTS

Statements made in this release that are not statements of historical or current facts are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, including, but not limited to, statements regarding the expected timing, completion or size of the offering, the expected gross proceeds therefrom, the intended use of net proceeds therefrom and the exercise of the common stock warrants prior to their expiration. We caution readers that forward-looking statements are predictions based on our current expectations about future events. These forward-looking statements are not guarantees of future performance and are subject to risks, uncertainties and assumptions that are difficult to predict. These risks and uncertainties relate, among other things, to fluctuations in our stock price, changes in market conditions and satisfaction of customary closing conditions related to the offering. Our actual results, performance, or achievements could differ materially from those expressed or implied by the forward-looking statements as a result of a number of factors, including the risks discussed under the heading "Risk Factors" discussed under the caption "Item 1A. Risk Factors" in Part I of our most recent Annual Report on Form 10-K or any updates discussed under the caption "Item 1A. Risk Factors" in Part II of our Quarterly Reports on Form 10-Q and in our other filings with the SEC. There can be no assurance that we will be able to complete the offering on the anticipated terms or at all. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise that occur after that date, except as required by law.

INVESTOR CONTACT

Noel Ryan or Bill Seymour

LYTS@vallumadvisors.com

Page 6 of 6

EX-99 - Exhibit 99.2

Exhibit 99.3

THE ROYSTON ACQUISITION

Acquisition Terms 

On February 20, 2026, we entered into an Agreement and Plan of Merger (the “Merger Agreement”) with SRR Holdings, Inc., a Delaware corporation (“Royston”), pursuant to which LSI Industries Inc. (“LSI” or the “Company”) through a wholly-owned subsidiary, Rhino Acquisition Company, Inc., a Delaware corporation (“Merger Sub”), agreed to merge with and into Royston, with Royston surviving (the “Merger”). The Merger Agreement provides for an aggregate purchase price of $325 million, subject to a working capital adjustment, with $320 million of the purchase price payable in cash at closing and the remaining $5 million payable in the issuance of the Company’s common stock, valued as of the closing price of the Company’s common stock on February 19, 2026. The completion of the Merger is subject to various closing conditions, including (a) the expiration or termination of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended; (b) the absence of any applicable order (whether temporary, preliminary or permanent) in effect which prohibits the consummation of the Merger; and (c) the absence of a Material Adverse Effect (as defined in the Merger Agreement) since the date of the Merger Agreement. The transaction is expected to close in the third quarter of LSI’s 2026 fiscal year.

Financing the Acquisition 

LSI intends to finance the acquisition of Royston through proceeds from a public offering of the Company’s common stock and a credit facility (the “Credit Facility”) with PNC Capital Markets LLC and PNC Bank, National Association (together, “PNC”), which will be amended to increase the amount available under the Credit Facility to $425 million pursuant to that certain Senior Secured Credit Facility Commitment Letter, dated January 21, 2026 between PNC and LSI. The consummation of the Merger is not subject to any financing condition.

Royston

Royston is a leading U.S.-based designer and manufacturer of cabinetry and store fixtures, refrigerated and heated cases, and signage for multiple end markets. Royston’s customer base spans across large, attractive end-markets of convenience, grocery and gas stations.

Royston offers the following differentiated solutions: (i) customized cabinetry and store fixture offerings targeted for the store perimeter versus standardized shelving for center aisles; (ii) exterior, interior and other signage offerings, scaled with national and regional customers; (iii) refrigerated and heated grab-and-go cases for the store perimeter; and (iv) complementary support services and international sourcing strategies utilized to support all business segments and solution categories.

Royston operates out of five strategically located operational facilities with approximately 780,000 production square footage with nearly 900 employees. Royston brings an experienced management team that we believe will lead Royston’s next stage of growth through the acquisition.

Transaction Rationale

As part of our Fast Forward value creation strategy, the Company remains focused on accelerating profitable growth through organic expansion, vertical market penetration, and strategic acquisitions to achieve long-term financial targets by fiscal year 2028. We believe the acquisition of Royston directly advances this strategy by meaningfully increasing scale, enhancing margin profile, and positioning the combined company to reach or exceed those targets ahead of plan.

The acquisition of Royston strengthens our strategic position as a “one-stop-shop” solutions provider, enabling the Company to serve as a single-source partner capable of delivering comprehensive lighting, display, and sign solutions. Royston brings a complementary mix of overlapping and unique products that broadens LSI’s overall offerings across both existing and greenfield categories, with particular growth opportunities in underrepresented product lines including refrigerated, millwork, and metal displays. Royston will operate in the Company’s same core verticals while significantly expanding the Company’s domestic manufacturing footprint to 23 combined facilities across the United States. From a financial perspective, the acquisition is accretive to adjusted EBITDA margin, with a pro forma increase of 150 basis points, and is expected to deliver meaningful cost synergies post-closing through enhanced cross-selling opportunities as well as increased raw materials procurement leverage.

The transaction also leverages the combined strength of LSI and Royston, two highly-respected, industry-leading brands, both of which are well-recognized in the market. In addition, the acquisition of Royston is expected to result in minimal customer overlap, as Royston’s top customers in refueling, convenience store, and grocery segments complement rather than compete with LSI’s existing client base, thereby expanding the Company’s market position and reach with large accounts while maintaining no greater than 40% revenue concentration for the top three customers in major categories. On a pro forma basis following the closing of the Merger, the combined company’s vertical market exposure is expected to be led by Refueling and Convenience Stores at 39%, followed by Grocery at 16%, and Commercial/Industrial and Retail at 13%. The remaining market mix is expected to be comprised of Other at 15% and Quick-Service Restaurants and Parking each at 8%, reflecting a diversified revenue base across end markets. Finally, to ensure continuity and alignment, the Royston leadership team will be fully retained, with 100% leadership retention expected to drive beneficial complementary workplace cultures, a customer-centric focus, and meaningful commercial growth.

Exhibit 99.4

Risks Related to the Merger

If LSI and Royston are unable to complete the Merger, in a timely manner or at all, each company’s business and LSI’s stock price may be adversely affected.

The obligations of LSI and Royston to consummate the Merger are subject to the satisfaction, or waiver by LSI, of the conditions described in the section titled “Conditions to Closing; Termination” in Article VIII of the Merger Agreement, including the receipt of required regulatory approvals.

The required satisfaction of the closing conditions could delay the completion of the Merger for a significant period of time or prevent it from occurring. Any delay in completing the Merger could cause LSI not to realize some or all of the benefits that LSI expects to achieve following the Merger.

If the Merger is not completed or is delayed, LSI’s stock price could fall to the extent that the Company’s current stock price reflects an assumption that the Merger will be completed on the expected timeline. Furthermore, if the Merger is delayed or is not completed and the Merger Agreement is terminated, LSI and Royston may suffer other consequences that could adversely affect each of their businesses and results of operations, including the following:

● each has incurred and will continue to incur costs relating to the Merger (including significant legal and financial advisory fees), and many of these costs are payable whether or not the Merger is completed;

● matters relating to the Merger (including integration planning) may require substantial commitments of time and resources by LSI’s and Royston’s management team, which could otherwise have been devoted to conducting their respective businesses or other opportunities that may have been beneficial to either company;

● LSI and Royston may be subject to legal proceedings related to the Merger or the failure to complete the Merger;

● a delay in completing the Merger, or failure to complete the Merger, negative perceptions about the Merger, or other factors beyond LSI’s and Royston’s control, may result in negative publicity and a negative perception in the investment community; and

● any disruptions to LSI’s or Royston’s business resulting from the announcement and pendency of the Merger.

If the Merger is not completed by the Outside Date, either LSI or Royston may have the right to terminate the Merger Agreement.

If the conditions to the obligations of either LSI or Royston to consummate the Merger Agreement are not satisfied or (where permissible) waived by the Outside Date, either LSI or Royston may have the right to terminate the Merger Agreement. LSI or Royston may elect to terminate the Merger Agreement in certain other circumstances, and LSI or Royston can mutually decide to terminate the Merger Agreement at any time prior to the closing of the Merger.

The announcement of and uncertainty about the Merger may adversely affect LSI’s and Royston’s relationships with their respective customers, suppliers, and employees, which could negatively affect each company’s business, whether or not the Merger is completed.

The announcement of the Merger may cause uncertainties in LSI’s and Royston’s relationships with their respective customers and suppliers which could impair each company’s ability to maintain or expand its business. Furthermore, uncertainties about the Merger may cause current and prospective employees of LSI and Royston to experience uncertainty about their future with their respective companies. These uncertainties may impair the ability of LSI and Royston to retain, recruit or motivate key employees which could affect their respective businesses.

The regulatory approvals required in connection with the Merger may not be obtained or may contain materially burdensome conditions.

Completion of the Merger is conditioned upon the receipt of certain regulatory approvals, including antitrust filings under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, and neither LSI nor Royston can provide assurance that these approvals will be obtained. If any conditions or changes to the proposed structure of the Merger are required to obtain these regulatory approvals, they may jeopardize or delay completion of the Merger or reduce the anticipated benefits of the Merger. If LSI agrees to any material conditions in order to obtain any approvals required to complete the Merger, the business and results of operations of the combined company may be adversely affected.

LSI, Royston and the combined company may be subject to litigation in connection with the Merger.

Lawsuits may be filed against LSI and Royston, their respective subsidiaries, and/or their respective directors or executive officers in connection with the Merger and/or the related transactions. In addition, lawsuits may be filed against the combined company following the Merger. If any such lawsuit is filed, it could result in a reduction in the stock price of LSI or the combined company following the Merger, substantial costs and diversion of management’s attention and resources, which could adversely affect the business, financial condition or results of operations of LSI, Royston and the combined company whether or not a settlement or other resolution is achieved.

Risks Related to the Combined Company

LSI may not realize the benefits anticipated from the Merger, which could adversely affect LSI’s stock price.

The anticipated benefits from the Merger are, necessarily, based on projections and assumptions about the combined business of LSI and Royston, which may not materialize as expected or which may prove to be inaccurate. LSI’s ability to achieve the anticipated benefits will depend on its ability to successfully and efficiently integrate the business and operations of Royston with those of LSI and achieve the expected synergies. LSI may encounter significant challenges with successfully integrating and recognizing the anticipated benefits of the Merger, including the following:

• potential disruption of, or reduced growth in, LSI’s historical core businesses, due to diversion of management attention and uncertainty with LSI’s current customer and supplier relationships;

• challenges arising from the expansion into those Royston jurisdictions where LSI does not currently operate or have significant operations;

• coordinating and integrating research and development teams across technologies and products to enhance product development;

• consolidating and integrating corporate, information technology, finance and administrative infrastructures, and integrating and harmonizing business systems;

• coordinating sales and marketing efforts to effectively position LSI’s capabilities and the direction of product development;

• difficulties in achieving anticipated cost savings, synergies, business opportunities and growth prospects from combining Royston’s business with LSI’s business;

• limitations prior to the completion of the Merger on the ability of management of LSI and of Royston to conduct planning regarding the integration of the two companies;

• the increased scale and complexity of LSI’s operations resulting from the Merger;

• retaining key employees, suppliers and other partners of LSI and Royston;

• obligations that LSI will have to counterparties of Royston that arise as a result of the change in control of Royston;

• difficulties in anticipating and responding to actions that may be taken by competitors in response to the Merger; and

• LSI’s assumption of and exposure to unknown or contingent liabilities of Royston. In addition, LSI’s anticipated benefits of the Merger contemplate significant cost-saving synergies over time. Consequently, even if LSI is able to successfully integrate the operations of Royston with its own, LSI may not realize the full benefits of the Merger if it is unable to identify and implement the anticipated cost savings or if the actions taken to implement such cost-savings have unintended consequences on LSI’ other business operations.

If LSI does not successfully manage these issues and the other challenges inherent in integrating an acquired business then it may not achieve the anticipated benefits of the Merger, LSI could incur unanticipated expenses and charges and its operating results and the value of its common stock could be materially and adversely affected.

The Merger may result in significant charges or other liabilities that could adversely affect the financial results of the combined company.

LSI has incurred, and expects to continue to incur a number of non-recurring costs associated with the Merger. The substantial majority of the non-recurring expenses will consist of transaction and regulatory costs related to the Merger. LSI will also incur transaction fees and costs related to formulating and implementing integration plans, including system consolidation costs and employment-related costs. LSI continues to assess the magnitude of these costs, and additional unanticipated costs may be incurred from the Merger and integration. Although LSI anticipates

that the elimination of duplicative costs and the realization of other efficiencies and synergies related to the integration should allow LSI to offset integration-related costs over time, this net benefit may not be achieved in the near term, or at all. As a result, the financial results of LSI following the Merger may be adversely affected by cash expenses and non-cash accounting charges incurred in connection with the Merger and the integration of the business and operations of Royston.

Furthermore, as a result of the Merger, LSI will record a significant amount of goodwill and other intangible assets on its consolidated financial statements, which could be subject to impairment based upon future adverse changes in LSI’s business or prospects including its inability to recognize the benefits anticipated by the Merger.

In addition, upon the completion of the Merger, LSI will be liable for some or all of Royston’s liabilities that LSI may have failed to or been unable to identify in the course of performing due diligence. If LSI is not able to completely assess the scope of these liabilities or if these liabilities are neither probable nor estimable at this time, LSI’s future financial results could be adversely affected by unanticipated reserves or charges, unexpected litigation or regulatory exposure, unfavorable accounting charges, unexpected increases in taxes due, a loss of anticipated tax benefits or other adverse effects on its business, operating results or financial condition. The price of LSI’s common stock following the Merger could decline to the extent the combined company’s financial results are materially affected by any of these events.

LSI’s actual financial position and results of operations following the Merger may differ, possibly materially, from the unaudited pro forma condensed combined financial information included in this report.

The unaudited pro forma financial information contained in this Current Report on Form 8-K is presented for illustrative purposes only and may not be an indication of LSI’s financial condition or results of operations following the Merger. The unaudited pro forma financial information has been derived from the historical audited and unaudited consolidated financial information of LSI and Royston, respectively, and certain adjustments and assumptions have been made regarding LSI after giving effect to the Merger. The information upon which these adjustments and assumptions have been made is preliminary, and these types of adjustments and assumptions are difficult to make with accuracy. For example, the unaudited pro forma financial information does not reflect all costs that are expected to be incurred by LSI in connection with the Merger. Additionally, the Merger and post-Merger integration process may give rise to unexpected liabilities and costs, including costs associated with the defense and resolution of transaction-related litigation or other claims. Unexpected delays in completing the Merger or in connection with the post-Merger integration process may significantly increase the related costs and expenses incurred by LSI. As a result, LSI’s actual financial condition and results of operations following the completion of the Merger may not be consistent with, or evident from, the unaudited pro forma financial information. In addition, the assumptions used in preparing the unaudited pro forma financial information may prove to be inaccurate, and other factors may affect LSI’s financial condition or results of operations following the consummation of the Merger. Any potential decline in LSI’s financial condition or results of operations may cause significant variations in the market price of its common stock following the Merger. For additional information, see the section titled “Unaudited Pro Forma Condensed Combined Financial Information” contained in this Current Report on Form 8-K.

The issuance of shares of our common stock in connection with the Merger will dilute the ownership and voting interests of existing LSI stockholders and may adversely affect the market price of our common stock.

Pursuant to the Merger Agreement, we will issue shares of our common stock as a portion of the Merger consideration, which will dilute the ownership percentage and voting power of our existing stockholders. As a result, our existing stockholders will have a reduced ownership and voting interest in the combined company and will therefore have less influence over the management and policies of the combined company than they currently exercise over LSI’s management and policies. Such dilution will, among other things, limit the ability of current LSI stockholders to influence matters requiring stockholder approval, including the election of directors and approval of significant corporate transactions following the Merger.

In addition, the issuance of a number of shares of our common stock in connection with the Merger could adversely affect the market price of our common stock, including through dilution of earnings per share or otherwise. Any dilution of, or delay in achieving any accretion to, earnings per share could cause the market price of our common stock to decrease.

LSI may experience difficulties integrating Royston’s business and realizing cost synergies and other anticipated benefits of the Merger.

Achieving the anticipated benefits of the Merger will depend in significant part upon whether LSI and Royston integrate their businesses in an efficient and effective manner. LSI has been able to conduct only limited planning regarding the integration of the companies following the Merger and has not yet fully determined the exact nature of how the businesses and operations of the companies will be combined after the Merger. The actual integration may result in additional and unforeseen expenses, and the anticipated benefits of the integration plan may not be realized. The companies may not be able to accomplish the integration process smoothly, successfully or on a timely basis.

If LSI is unable to achieve the cost synergies and other anticipated benefits within the expected timeframe, or at all, LSI’s business, financial condition, results of operations and the trading price of its common stock may be materially adversely affected. The integration of the two companies may result in material challenges, including, without limitation:

• coordinating geographically separated organizations, including in international markets with differing business, legal, and regulatory climates, and addressing possible differences in corporate cultures and management philosophies;

• consolidating corporate, administrative and compliance infrastructures and eliminating duplicative operations;

• operating numerous systems and controls, including those involving management information, purchasing, accounting and finance, sales, billing, employee benefits, payroll and regulatory compliance;

• the diversion of management’s attention from ongoing business concerns, day-to-day operations, and performance shortfalls at one or both of the companies as a result of the devotion of management’s attention to the Merger and related integration responsibilities;

• the disruption of, or loss of momentum in, each company’s ongoing businesses or inconsistencies in standards, controls, procedures and policies;

• maintaining employee morale and focus, retaining key management and other employees and the possibility that the integration process and potential organizational changes may adversely impact the ability to maintain employee relationships;

• any inability of management to successfully and timely integrate the operations of the two companies;

• retaining existing business and operational relationships, including but not limited to, agents, brokers, franchisees, affiliates, customers, real estate partners, employees and other counterparties, and attracting new business and operational relationships;

• unanticipated issues in integrating information technology, communications and other complex systems; and

• any other unforeseen expenses, costs, liabilities or delays associated with the Merger or the integration.

The combined company’s inability to integrate other recently acquired businesses or to successfully complete future acquisitions could limit its future growth or otherwise be disruptive to its ongoing business.

LSI has pursued several acquisitions in recent years. LSI completed its acquisitions of Canada’s Best Holdings (“CBH”) and EMI Industries, LLC (“EMI”) in March 2025 and April 2024, respectively. LSI is still in the process of integrating the recently acquired businesses and assets, including CBH and EMI, and, following the Merger, will also need to successfully integrate the overall businesses of LSI and Royston in the combined company. Additionally, LSI may pursue future acquisitions that it believes will be complementary to its business. The anticipated benefits and synergies from recently completed acquisitions or future acquisitions may not materialize to the extent projected or at all.

If LSI is unable to implement and maintain effective internal control over financial reporting following completion of the Merger, LSI may fail to prevent or detect material misstatements in its financial statements, in which case investors may lose confidence in the accuracy and completeness of its financial reports and the market price of its securities may decline.

LSI and Royston currently maintain separate internal control over financial reporting with different financial reporting processes and different process control software. LSI plans to integrate its internal control over financial reporting with that of Royston. LSI may encounter difficulties and unanticipated issues in combining LSI and Royston respective accounting systems due to the complexity of the financial reporting processes. LSI may also identify errors or misstatements that could require audit adjustments. If LSI is unable to implement and maintain effective internal control over financial reporting following completion of the Merger, LSI may fail to prevent or detect material misstatements in its financial statements, in which case investors may lose confidence in the accuracy and completeness of its financial reports and the market price of its securities may decline.

Royston may have liabilities that are not known, probable, or estimable at this time.

After the Merger, Royston will remain subject to certain past, current, and future liabilities. There could be unasserted claims or assessments against or affecting Royston, including the failure to comply with applicable laws and regulations. In addition, there may be liabilities of Royston that are neither probable nor estimable at this time that may become probable or estimable in the future, including indemnification requests received from customers of Royston relating to claims of infringement or misappropriation of third-party intellectual property or other proprietary rights, tax liabilities and liabilities in connection with other past, current and future legal claims and litigation. Any such liabilities, individually or in the aggregate, could have a material adverse effect on the combined company’s financial results. LSI may learn additional information about Royston that adversely affects the combined company, such as unknown, unasserted, or contingent liabilities and issues relating to compliance with applicable laws or infringement or misappropriation of third-party intellectual property or other proprietary rights.

Royston is subject to numerous legal and regulatory regimes and the combined business could be harmed by changes to, or the interpretation or the application of, the laws and regulations of each of the jurisdictions in which it operates.

In addition to the United States, Royston maintains limited operations in Mexico and China. The international scope of Royston’s business will require the combined company to comply with a wide range of national and local laws and regulations, which may in certain cases diverge from or even conflict with each other.

In countries where LSI and Royston operate, legislators and regulatory authorities may introduce new interpretations of existing laws and regulations or introduce new legislation or regulations concerning the business of LSI and/or Royston. Changes in government regulation of or successful challenges to the business model used by LSI or Royston in certain markets may require the combined company to change its existing business models and operations. Any additional regulatory scrutiny or changes in legal requirements may impose significant compliance costs and make it uneconomical for the combined company to continue to operate in all of the current markets or to expand in accordance with the combined company’s strategy, particularly if regulations or their interpretations vary greatly or conflict between different operating countries. This may negatively impact the combined company’s revenue and profitability by preventing the combined company’s business from reaching sufficient scale in particular markets or having to change its business model or incur additional costs, which would adversely impact the combined company after the completion of the Merger.

The combined company’s goodwill or other intangible assets may become impaired, which could result in material non-cash charges to its results of operations.

The combined company will have goodwill and other intangible assets resulting from the Merger. At least annually, or whenever events or changes in circumstances indicate a potential impairment in the carrying value as defined by GAAP, the combined company will evaluate this goodwill and other intangible assets for impairment based on the fair value of each reporting unit. Estimated fair values could change if there are changes in the combined company’s capital structure, cost of debt, interest rates, capital expenditure levels, operating cash flows, or market capitalization. Impairments of goodwill or other intangible assets could require material non-cash charges to the combined company’s results of operations.

The combined company may be unable to manage its growth effectively.

The combined company’s growth strategy will place significant demands on its financial, operational and management resources. In order to continue its growth, the combined company may need to add administrative and other personnel, and will need to make additional investments in operations and systems. There can be no assurance that the combined company will be able to find and train qualified personnel, or do so on a timely basis, or expand its operations and systems to the extent, and in the time, required.

Uncertainties associated with the Merger may cause a loss of key personnel, which could have a material adverse effect on the combined company’s financial condition, results of operations, and growth prospects.

The success of the combined company will depend on the experience, industry knowledge, and continued contributions of key employees and officers. Each company’s success while the Merger is pending and the success of the combined company after the completion of the Merger will depend in part upon the ability of LSI and Royston to retain certain management. In addition, current and prospective personnel of LSI and Royston may experience uncertainty about their roles while the Merger is pending and following the completion of the Merger, which may have an adverse effect on the ability of each of LSI and Royston to attract or retain management and other key personnel. LSI and Royston could face disruptions in their operations, loss of existing agents, brokers, franchisees, affiliates, customers, and real estate partners, loss of key information, expertise or know-how and unanticipated additional recruitment and training costs, among other things. The loss of the services of key employees and officers, whether such loss is through resignation or other causes, or the inability to attract additional qualified personnel, could have a material adverse effect on the combined company’s financial condition, results of operations, and growth prospects. Accordingly, no assurance can be given that LSI and Royston, while the Merger is pending, and the combined company, after the completion of the Merger, will be able to attract or retain management and other key personnel to the same extent that LSI and Royston have previously been able to attract or retain their personnel.

Following the completion of the Merger, the Company’s exposure to fluctuations in foreign currency exchange rates will be increased.

Royston conducts a portion of its operations outside of the United States, including in Mexico and China, which also operate in their respective local currencies. Therefore, following the completion of the Merger, the combined company’s international operations will account for a more significant portion of overall operations than they do presently for LSI and its exposure to fluctuations in foreign currency exchange rates will increase. Because our financial statements will continue to be presented in U.S. dollars subsequent to the completion of the transaction, the local currencies will be translated into U.S. dollars at the applicable exchange rates for inclusion in our consolidated financial statements, thereby increasing the foreign exchange translation risk.

Royston is not a reporting company and is not subject to the reporting, disclosure, and internal control requirements applicable to public companies, which may increase the risks associated with the Merger.

Royston is, and prior to the consummation of the Merger will remain, a private company that is not required to file periodic reports with the U.S. Securities and Exchange Commission pursuant to the Securities Exchange Act of 1934, as amended. As a result, investors do not have access to financial information and certain other information of Royston typically available for a reporting company. Although LSI has conducted due diligence in connection with the Merger, such due diligence may not have identified all existing or potential issues, liabilities, deficiencies, or risks affecting Royston’s business. Following the completion of the Merger, LSI may identify matters relating to Royston’s operations, financial reporting, internal controls, tax positions, compliance practices, or historical performance that could require remediation, result in additional costs or liabilities, or otherwise adversely affect the combined company’s business, financial condition, results of operations, or prospects.

Risks Related to Royston

Historical financial information of Royston may not be indicative of its future performance as part of the combined company.

As a privately held company, Royston’s historical financial performance may not be indicative of how Royston will perform following the Merger as part of a publicly traded organization. Differences in accounting policies, financial reporting practices, internal controls, and compliance requirements may affect the comparability of Royston’s historical financial information to that of LSI or to the combined company’s future financial results.

In addition, Royston’s historical operating results may not reflect the costs associated with operating as part of a public company structure, including enhanced compliance, reporting, internal control, audit, and governance requirements. For example, because Royston, prior to the Merger, was not subject to reporting requirements, it may not have accounting personnel specifically employed to review internal controls over financial reporting and other procedures or to ensure compliance with the requirements of the Sarbanes-Oxley Act of 2002. Bringing the legacy systems for these businesses into compliance with those requirements and integrating them into the combined company’s compliance and accounting systems may cause us to incur substantial additional expenses, make some activities more difficult, time-consuming or costly and increase demand on our systems and resources. As a result, the combined company’s future operating results may differ materially from Royston’s historical results, and investors should not rely on Royston’s historical performance as an indication of future performance following the Merger.

Certain risks, liabilities, or compliance issues affecting Royston may not have been fully identified prior to the Merger.

Because Royston has not been subject to public company reporting obligations, there may be risks, liabilities, compliance matters, or operational issues that were not required to be disclosed publicly and may not have been fully identified during LSI’s due diligence efforts prior to the closing of the Merger. These may include, among other things, contingent liabilities, contractual obligations, tax exposures, regulatory compliance matters, employment-related issues, environmental liabilities, or intellectual property risks.

If any such matters are identified following the completion of the Merger, the combined company may be required to incur significant costs, make additional disclosures, record reserves or charges, or take corrective actions that could materially and adversely affect its business, financial condition, results of operations, or the market price of LSI’s common stock.

Our ability to retain key personnel and attract qualified personnel is critical to our success.

Our success depends in large part on the continued contributions of our senior management team and other key employees, including those with expertise in research and development, manufacturing, sales, marketing, and operations. Competition for qualified personnel in our industry is intense, and we may not be able to retain our key employees or attract and retain additional qualified personnel in the future. The loss of the services of any of our key personnel, or our inability to attract and retain qualified personnel, could delay our product development efforts, disrupt our operations, and otherwise have a material adverse effect on our business, financial condition, and results of operations.

We depend on third-party suppliers for raw materials, and any price increase, shortage, delay, or disruption in supply could harm our operations.

We rely on third-party suppliers for certain raw materials that are critical to our manufacturing processes. The availability of these raw materials may be subject to market conditions, supplier capacity constraints, geopolitical instability, natural disasters, transportation disruptions, and other factors beyond our control. If our suppliers are unable or unwilling to provide us with raw materials in a timely manner or at acceptable prices, or if we are unable to find alternative sources of supply, we may experience production delays, increased costs, or an inability to meet customer demand. Any such supply chain disruption could have a material adverse effect on our business, financial condition, and results of operations

We may experience labor shortages or increased labor costs, which could adversely affect our business and results of operations.

Our operations depend on our ability to attract, train, and retain a sufficient number of qualified employees, including skilled manufacturing and production workers. We face competition for labor from other employers in our industry and geographic areas, and we may experience difficulty hiring and retaining employees due to labor market conditions, wage pressures, changing workforce demographics, or other factors. A shortage of qualified labor or increased labor costs could require us to pay higher wages for employees and incur a corresponding reduction in our profitability. Any such shortage may also result in production delays, increased operating expenses, or a decreased ability to produce sufficient quantities of our product to effectively serve our customers, any of which could have a material adverse effect on our business, financial condition, and results of operations.

Our manufacturing operations are subject to risks that could disrupt production and adversely affect our business.

Our business depends on the efficient and uninterrupted operation of our manufacturing facilities. Our manufacturing operations are subject to various risks, including equipment failures or malfunctions, quality control issues, human error, power outages, information technology system failures, natural disasters, public health emergencies, and other events that could cause production delays, increased costs, or product defects. We may also face challenges in scaling our manufacturing capacity to meet increased demand or in implementing new manufacturing processes or technologies. Any significant disruption to our manufacturing operations could result in delivery delays, lost revenue, increased expenses, damage to our reputation, and potential liability, any of which could have a material adverse effect on our business, financial condition, and results of operations.

We may not be able to protect our intellectual property rights throughout the world.

Filing, prosecuting and defending trademarks throughout the world would be prohibitively expensive. Competitors may use our licensed and owned technologies in jurisdictions where we have not licensed or obtained trademark protection to develop their own products and, further, may export otherwise infringing products to territories where we may obtain or license trademark protection, but where trademark enforcement is not as strong as that in the U.S. These products may compete with our products in jurisdictions where we do not have any issued or licensed trademarks and any future trademark claims or other intellectual property rights may not be effective or sufficient to prevent them from so competing.

Many companies have encountered significant problems in protecting and defending intellectual property rights in foreign jurisdictions. The legal systems of certain countries, particularly certain developing countries, do not favor the enforcement of trademarks and other intellectual property protection, which could make it difficult for us to stop the infringement of our registered trademarks and future trademarks we may own, or marketing of competing products in violation of our proprietary rights generally. Further, the laws of some foreign countries do not protect proprietary rights to the same extent or in the same manner as the laws of the U.S. As a result, we may encounter significant problems in protecting and defending our licensed and owned intellectual property both in the U.S. and abroad. For example, China, where we currently have a number of registered trademarks, currently affords less protection to a company’s intellectual property than some other jurisdictions. As such, the lack of strong intellectual property protection in China may significantly increase our vulnerability regarding unauthorized disclosure or use of our intellectual property and undermine our competitive position. Proceedings to enforce our future trademark rights, if any, in foreign jurisdictions could result in substantial cost and divert our efforts and attention from other aspects of our business.

Certain of Royston’s customer relationships are governed by agreements that contain certain restrictions on transfer or assignment upon a change of control, and failure to obtain required consents to or waivers of the same could adversely affect the combined company.

Royston is a party to various existing agreements, including joint venture agreements, supply agreements, and other commercial contracts that restrict Royston’s ability to sell, assign, transfer, or otherwise dispose of its interests without the prior written consent of the applicable counterparty. In connection with the Merger, such provisions may be triggered and require the consent of third parties to avoid a breach, default, termination right, or other adverse consequences under such agreements.

There can be no assurance that Royston will be able to obtain all required consents, waivers, or releases from the counterparties in a timely manner, on acceptable terms, or at all. Counterparties may condition their consent on modifications to existing contractual terms, accelerated payment obligations, or other concessions or restrictions that could be unfavorable to Royston and/or the combined company following the consummation of the Merger. Further, certain counterparties may elect to exercise rights of first refusal, termination rights, or other preferential remedies, which could result in the termination of or modification to material customer relationships.

If Royston is unable to obtain requisite consents or waivers, Royston and/or the combined company may be required to restructure certain customer relationships, incur additional costs, litigate disputes, forego certain contractual rights or benefits, or experience a loss of, or material adverse change in, certain business relationships, revenues, or assets. Any of the foregoing could have a material adverse effect on the business, financial condition, results of operations, and prospects of Royston, and, following the closing of the Merger, the combined company.

Royston operates internationally and is subject to foreign economic uncertainties and foreign currency fluctuation.

In addition to the United States, Royston operates on a limited based in Mexico and China. As a result, a certain portion of its revenues are denominated in foreign currencies, which may result in additional risk of fluctuating currency values and exchange rates and controls on currency exchange. Changes in the value of foreign currencies could increase Royston’s U.S. dollar costs for, or reduce its U.S. dollar revenues from, Royston’s foreign operations. Moreover, any increased costs or reduced revenues as a result of foreign currency fluctuations could affect Royston profits.

Royston faces uncertainty and adverse changes in the economy.

Adverse changes in the economy could negatively impact Royston’s business. Future economic distress may result in a decrease in demand for Royston’s products, which could have a material adverse impact on its operating results and financial condition. In addition, tariffs imposed by the U.S. government on certain imported goods, equipment, technology, or supplies used in Royston’s business, any retaliatory and/or reciprocal tariffs imposed on U.S. exports by foreign countries, including China, as well as any additional tariffs, duties, or other trade measures or restrictions could increase Royston’s operating costs, disrupt its supply chain, lead to changes in the business environment in which Royston operates, or otherwise have a material adverse effect on Royston’s business, financial condition, or results of operations. Uncertainty and adverse changes in the economy could also increase costs associated with developing and publishing products, increase the cost and decrease the availability of sources of financing, and increase Royston’s exposure to material losses from bad debts, any of which could have a material adverse impact on the financial condition and operating results of Royston.

War, terrorism, and other acts of violence may affect the markets in which Royston operates, its clients and its product and service delivery.

Royston business may be adversely affected by regional or global instability, disruption or destruction, regardless of cause, including war, terrorism, riot, civil insurrection or social unrest. Such events may cause clients to delay their decisions on spending for the products and services provided by Royston and give rise to sudden significant changes in regional and global economic conditions and cycles. These events pose risks which could materially adversely affect Royston’s financial results.

Royston is subject to various government regulations, restrictions and requirements, and may be subject to additional regulations in the future, violation of which could harm or add costs to Royston’s business.

Legislative changes in the United States and throughout the world, including changes in regulatory policy in Royston’s operations, may affect its ability to meet schedules for delivering products to its customers and providing services to its customers. In addition, such changes and/or Royston’s non-compliance of the lawful requirements due to such changes, may cause Royston additional expenses and/or cause the imposition of new restrictions on its operations and thus impair its ability to provide services to customers or to expand the geographic footprint of its operations.

Royston’s information technology systems are subject to cyber risks and other disruptions that could adversely affect its business.

Royston relies on information technology systems and third-party service providers to operate its business, including for communications, financial reporting and operational processes. These systems are subject to risks from cyber-attacks, ransomware, data breaches, natural disasters, power and telecommunications outages, and other events beyond Royston’s control. Although Royston has implemented security measures, business continuity plans and other safeguards designed to protect its systems and data, such measures may not be effective against increasingly sophisticated threats.

A significant cybersecurity incident or other system disruption could result in service interruptions, loss of data, operational delays, reputational harm, regulatory exposure, or financial loss. Any such event could materially and adversely affect Royston’s business, financial condition and results of operations.

Royston is, and may be in the future, subject to litigation and other legal proceedings that could have a material adverse effect on its business, financial condition and results of operations.

Royston is, and from time to time may be, subject to litigation, claims, investigations, arbitration proceedings or other legal or regulatory matters arising in the ordinary course of its business, including commercial disputes, contract claims, intellectual property matters, employment-related claims, product liability claims, and other proceedings. The outcome of such matters is inherently uncertain, and adverse judgments, settlements or regulatory determinations could result in monetary damages, penalties, fines, injunctive relief or other remedies that could negatively impact Royston’s business, financial condition and results of operations.

Even if Royston ultimately prevails in any such matter, litigation and other proceedings can be time-consuming, costly and disruptive to normal business operations, divert management’s attention and resources, and harm Royston’s reputation and customer relationships. In addition, the costs of defending such matters may not be fully covered by insurance or indemnification arrangements, and insurance coverage may be unavailable or insufficient to cover all losses or claims. As a result, the resolution of current or future legal proceedings could have a material adverse effect on Royston’s business, financial condition and operating results.

Risks Related to LSI

LSI’s and Royston’s businesses are and will be subject to the risks described above. In addition, you should read and consider the risks to LSI’s business that will also affect the combined company after closing of the Merger, which are described in LSI’s Annual Report on Form 10-K for the fiscal year ended June 30, 2025, as updated by subsequent Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, all of which are incorporated by reference into this document, and in other documents that are incorporated by reference into this document.

Exhibit 99.5

BUSINESS OF ROYSTON AND CERTAIN INFORMATION ABOUT ROYSTON

This Business section provides a comprehensive overview of the business of SRR Holdings, Inc., a Delaware corporation (“Royston”, and together with all of Royston’s subsidiaries, “Royston Group”), including a description of its core operations, the industries in which it operates, its employee and human capital profile, and other information pertinent to understanding the business in the context of the transaction reported in the accompanying Current Report on Form 8-K.

Overview

Royston was incorporated in the State of Delaware on February 21, 2018 as Royston Holdings, Inc. On July 25, 2018, Royston amended its certificate of incorporation to change its name to SRR Holdings, Inc. Royston Group is an integrated designer, manufacturer, and installer of branded store environments, including cabinetry and store fixtures under the Royston brand, refrigerated and heated display cases under the Southern CaseArts brand, and exterior signage under the SignResource brand. The Royston Group provides a differentiated “one-stop-shop” model from collaborative design and engineering through fabrication, finishing, assembly, and delivery, enabling turnkey execution for scaled national and regional customers.

Since 2018, Royston Group has completed four acquisitions to expand its product offering and cross-selling potential: SignResource, LLC, a California limited liability company in July 2018 (“SignResource”); Hamilton Laboratory Solutions (Shanghai) Co., Ltd., a wholly foreign-owned enterprise organized under the laws of the People’s Republic of China in February 2020; Southern CaseArts, Inc., an Alabama corporation in July 2020 (“Southern CaseArts”); and ProImage Wholesale Signs, LLC, a Kansas limited liability company in September 2020.

Today, Royston Group operates five well-invested U.S. manufacturing facilities with best-in-class lead times, offering integrated capabilities including sheet metal fabrication, powder coating, silk screening, vacuum and metal forming, and metal and plastic painting for a broad variety of select products. Royston Group’s strategy emphasizes operational excellence, organic growth, and disciplined M&A to expand capabilities and deepen customer relationships.

Core Operations

Royston Group operates three primary business lines: (i) Royston cabinetry, checkstands, shelving, and store fixtures; (ii) SignResource exterior signage; and (iii) Southern CaseArts refrigerated and heated display cases.

Royston Group delivered a strong financial performance in the nine months ended September 30, 2025, generating revenue of approximately $202.4 million and Adjusted EBITDA of approximately $30 million, representing an Adjusted EBITDA margin rate of approximately 15%.

For the nine months ended September 30, 2025, Royston, SignResource, and Southern CaseArts represented approximately 58%, 29% and 13%, respectively, of net sales. By product solution, cabinets and store fixtures, exterior signage, other services, and refrigerated and heated cases accounted for approximately 52%, 22%, 14%, and 12%, respectively, of net sales for the nine months ended September 30, 2025. From an end market perspective, convenience stores represented approximately 51% of Royston Group’s net sales for the nine months ended September 30, 2025, followed by grocery at approximately 31%, gas stations at approximately 13%, and other markets at approximately 5%.

Operations integrate design, engineering, fabrication, paint and finishing, assembly, and delivery, enabling complex, multi-site rollouts with consistent quality and brand execution. Royston Group is expanding direct-perform capabilities and intends to operate as a general contractor in select southeastern U.S. states to streamline execution and reduce coordination bottlenecks.

Commercially, Royston Group aligns to customer strategic priorities, leveraging deep relationships to increase share within existing accounts while pursuing targeted acquisitions to broaden capabilities and market access.

Industries and Markets

Royston Group serves diversified end-markets through national and regional programs requiring consistent brand presentation at scale, including convenience and gas, grocery, quick-service restaurants, and related retail channels. Royston Group targets customers that often purchase both fixtures and signage, enabling cross-sell across interior and exterior environments and supporting multi-year program visibility. Royston Group believes that its U.S. serviceable addressable market was estimated at approximately $13.4 billion in 2024, with potential growth to approximately $17.0 billion by 2030, driven by recurring remodel activity, retrofit and replacement demand, and continued new store development among leading chains.

Customers, Sales, and Marketing

Royston Group operates primarily within the United States, with limited operations in Mexico and China. Royston Group’s top customer relationships average over 20 years, serving multiple top U.S. chains across convenience store, grocery store, and gas station end-markets. Royston Group primarily engages customers directly, while selectively utilizing sales agencies to extend coverage of opportunistic projects, maintaining direct contact with end-customers to ensure program quality and responsiveness.

Royston Group’s customer base is largely consistent across the Royston, SignResource, and Southern CaseArts business lines, as several of the company’s largest customers by sales volume purchase cabinetry and fixtures, temperature-controlled cases, and signage solutions from the company. Its customer uniformity is further evidenced by its strong position among market leaders, as Royston Group serves three of the largest five U.S. convenience store and grocery store chains, as well as four of the largest five U.S. gas station chains. To that end, Royston Group has a strong pipeline of potential remodel and cross-sell opportunities from existing customers and believes that these customers plan to expand their business with the company.

Royston Group’s go-to-market process emphasizes just-in-time execution, with typical lead times of approximately four weeks for Royston and SignResource offerings and approximately 10-12 weeks for Southern CaseArts, supported by defined steps from site survey through installation and post-install review. The commercial organization comprises approximately 28 total sales representatives with an average sales representative tenure of approximately 13 years across business units.

Supply Chain, Manufacturing, and Operations

Royston Group operates an integrated U.S. manufacturing and logistics footprint designed to support large, multi-site customer programs. Core capabilities include design engineering, metal fabrication, thermoforming, CNC routing, finishing (including powder coat paint lines), assembly, and coordinated delivery, enabling consistent quality and schedule adherence across programs. Royston Group’s operating footprint includes facilities in Royston, Georgia; Jasper, Georgia; Bessemer, Alabama; Bell Gardens, California; and Jacksboro, Tennessee, with approximately 783,000 total production square feet and current staffing generally at two shifts per day, five days per week. Site-level key performance indicators reflect approximately 98% on-time delivery and average lead times of approximately five weeks for Royston.

Royston Group maintains a diversified U.S.-based supplier network for key inputs, with an average tenure of more than 14 years among top suppliers and categories including metal materials, electronic components, and paint and powder coat, supporting quality and pricing.

Intellectual Property and Technology

Royston Group’s competitive position is supported by its diverse portfolio of intellectual property, including 23 U.S. federal trademarks, 12 Canadian trademarks, one trademark registration in Alabama, and 18 other international trademarks, several of which are registered in the People’s Republic of China. In addition, Royston Group owns three issued patents related to store fixture and cabinetry technology and possesses one pending patent application for similar technology. Royston Group also holds three copyright registrations, as well as several domain names and social media accounts related to its business.

Royston Group’s competitive position is further supported by proprietary design libraries and engineering know-how enabling mass customization at scale, with more than 1.2 billion available product configurations. Standardized operating procedures and program management tools ensure brand consistency, quality, and speed-to-market across customer programs.

Regulation and Compliance

Royston Group’s operations are not subject to extensive industry-specific regulation, but are instead governed primarily by generally applicable federal, state, local, and, where relevant, international laws and regulations, with certain targeted requirements relating to product standards and energy efficiency for refrigerated and heated display cases, including applicable regulations of the U.S. Department of Energy and the Environmental Protection Agency. Royston Group maintains compliance programs tailored to its risk profile, including training, monitoring, and governance oversight by management and the Board of Directors. Changes in applicable laws or enforcement priorities could affect the cost and manner of conducting Royston Group’s business, and Royston Group continuously monitors developments to adjust its policies, processes, and controls accordingly.

Properties

Royston Group leases the facilities used for corporate offices, manufacturing, distribution, and program support. Principal production locations and approximate square footage include: Jasper, GA (Royston) ~219,000 sq. ft.; Royston, GA (Royston) ~198,000 sq. ft.; Bessemer, AL (Southern CaseArts) ~190,000 sq. ft.; Bell Gardens, CA (SignResource) ~92,500; and Jacksboro, TN (SignResource) ~83,200 sq. ft., representing approximately 783,000 total production square feet, with utilization ranging from approximately 27% to 53% across sites based on two shifts per day. Royston Group believes these facilities are suitable and adequate for current operations and support anticipated growth.

Legal Proceedings

From time to time, Royston Group is involved in claims, lawsuits, regulatory inquiries, audits, or other legal proceedings arising in the ordinary course of business. As of the date of this filing, Royston Group is not a party to any legal proceeding that it believes would have a material adverse effect on its consolidated financial condition, results of operations, or cash flows. Royston Group maintains insurance coverage it deems appropriate, subject to deductibles, exclusions, and policy limits.

Employees and Human Capital

As of December 31, 2025, Royston Group had approximately 894 employees. The company’s workforce spans production, engineering, sales and sales support, and administrative functions, with the substantial majority employed on a full-time basis. Employee populations are concentrated in Jasper, GA; Royston, GA; Bessemer, AL; Bell Gardens, CA; and Jacksboro, TN, aligned to Royston Group’s manufacturing footprint, with headcount distribution by manufacturing facility of approximately 30% in Jasper, 25% in Royston, 17% in Bell Gardens, 16% in Bessemer, and 12% in Jacksboro.

Royston Group is committed to attracting, developing, and retaining talent through competitive compensation and benefits, learning and development programs, and a culture that emphasizes safety, inclusion, and ethical conduct. Health and safety are core priorities, and Royston Group monitors leading and lagging indicators to drive continuous improvement across its sites.

Environmental, Social, and Governance

Royston Group embeds operational excellence and standardized procedures across its facilities to promote quality, safety, and responsible operations, including vertical integration and insourcing initiatives designed to enhance service levels, reduce lead times, and support product quality. Governance of continuous improvement and program execution is supported by defined standards and accountability for performance across the organization.

Seasonality and Cyclicality

Demand is influenced by recurring remodel cycles and retrofit/replacement activity across convenience, grocery, and quick-service restaurant (“QSR”) end-markets, which can create intra-year phasing tied to customer program timing and budget cycles. New store development and franchise renovations also contribute to order cadence, particularly in QSRs. Royston Group manages seasonality through capacity planning, operational flexibility, and a diversified product and service mix.

Competition

Royston Group competes with national and regional providers across product categories.

Royston Group believes that the offerings and its unique end-to-end capabilities has significant competitive advantages differentiating the products and services it offers to customers, with the primary advantages as follows:

● A comprehensive one-stop offering, mass-customization capabilities, domestic footprint, and demonstrated cross-sell execution;

● A structural cost advantage versus most competitors due to Royston Group’s scale and proven ability to pass through cost changes and manage margins; and

● A product sourcing strategy that empowers Royston Group to accelerate design and production timelines while achieving more competitive pricing for products that are not typically manufactured in-house, which gives Royston Group an advantage over its competitors.

Insurance

Royston Group maintains insurance coverage typical for companies of our size and industry, including policies for property, casualty, general liability, product liability, directors’ and officers’ liability, cyber risk, and other standard coverages. Royston Group’s insurance is subject to customary deductibles, exclusions, and limits, and there can be no assurance that coverage will be adequate for all potential losses.

Exhibit 99.6

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS OF SRR HOLDINGS, INC.

The following discussion and analysis of SRR Holdings, Inc.’s (“Royston”) financial condition and results of operations should be read in conjunction with the audited and unaudited financial statements and the related notes of Royston for the years ended December 31, 2024, and 2023 and the unaudited financial statements and the related notes of Royston for the nine months ended September 30,2025, and 2024, included in this current report on Form 8-K.

Overview

Royston was incorporated in the State of Delaware on February 21, 2018, as Royston Holdings, Inc. On July 25, 2018, Royston amended its certificate of incorporation to change its name to SRR Holdings, Inc. Royston, and together with all of Royson’s subsidiaries, is commonly referred to as Royston Group.

Royston Group is an integrated designer, manufacturer, and installer of branded store environments, including cabinetry and store fixtures under the Royston brand, refrigerated and heated display cases under the Southern CaseArts brand, and exterior signage under the SignResource brand. The Royston Group provides a differentiated “one-stop-shop” model from collaborative design and engineering through fabrication, finishing, assembly, and delivery, enabling turnkey execution for scaled national and regional customers.

Since 2018, Royston Group has completed four acquisitions to expand its product offering and cross-selling potential: SignResource, LLC, a California limited liability company in July 2018; Hamilton Laboratory Solutions, a provider of specialized furniture and casework for laboratories, together with their subsidiary, Hamilton Laboratory Solutions (Shanghai) Co., Ltd., a wholly foreign-owned enterprise organized under the laws of the People’s Republic of China in February 2020; Southern CaseArts, Inc., an Alabama corporation in July 2020; and ProImage Wholesale Signs, LLC, a Kansas limited liability company in September 2020.

Today, Royston Group operates five well-invested U.S. manufacturing facilities with best-in-class lead times, offering integrated capabilities including sheet metal fabrication, powder coating, silk screening, vacuum and metal forming, and metal and plastic painting for a broad variety of select products. Royston Group’s strategy emphasizes operational excellence, organic growth, and disciplined M&A to expand capabilities and deepen customer relationships.

Results of Operations

Year Ended December 31, 2024, compared to Year Ended December 31, 2023:

SRR Holdings, Inc. and Subsidiaries
Years Ended December 31, 2024 and 2023
(Audited)										Increase
(In thousands)		2024				2023				(Decrease)				% change
Net sales		$	271,328			$	277,540			$	(6,212	)			-2.2	%
Cost of products and services sold			210,835				214,365				(3,530	)			-1.6	%
Gross profit			60,493				63,175				(2,682	)			-4.2	%
			22	%			23	%
Selling, general and administrative expenses			42,818				40,230				2,588				6.4	%
Operating income			17,675				22,945				(5,270	)			-23.0	%
			7	%			8	%
Other Expenses
Interest expense			(9,502	)			(10,890	)			1,388				-12.7	%
Equity in Earnings of Joint Venture			355				220				135				61.4	%
(Loss) gain on disposal of fixed assets			(718	)			11				(729	)		n/m
Earnings before income taxes			7,810				12,286				(4,476	)			-36.4	%
Income tax expense			(5,010	)			4,522				(9,532	)		n/m
NET INCOME			12,820				7,764				5,056				65.1	%
Foreign currency translation adjustment			(8	)			(28	)			20
TOTAL COMPREHENSIVE INCOME		$	12,812			$	7,736			$	5,076				65.6	%

Revenues

Net sales of $271.3 million decreased 2.2% from the same period in 2023. The decrease in net sales was attributable to the completion of several rollout programs in 2023 with larger customers, partially offset by an increase in net sales in 2024 with other programs and customers.

Gross Profit

Gross profit of $60.5 million decreased 4.2% for the year ended December 31, 2024 from the same period in 2023, primarily due to the decline in net sales. In addition. gross profit as a percentage of sales declined from 22.8% in 2023 to 22.3% in 2024 due mostly to customer and product mix.

Selling, General and Administrative Expenses

Selling, general and administrative expenses of $42.8 million increased 6.4% for the year ended December 31, 2024 from the same period in 2023. The increase was mostly attributed to severance and plant closure costs in addition to commercial initiatives to support the growth of the Royston Group.

Operating Income

Operating income of $17.7 million decreased 23.0% for the year ended December 31, 2024 from the same period in 2023. The decrease in operating income was attributable to a decrease in net sales and an increase in selling, general and administrative expenses.

Other Expense

The largest component of other expense is interest expense on the Company’s outstanding debt. Interest expense of $9.5 million for the year ended December 31, 2024 decreased 12.7% from the same period in 2023. Positive cash flow from earnings coupled with effective management of its working capital has afforded the Company the ability to pay down its outstanding debt.

Net Income

Pre-tax income was $4.5 million lower for the year ended December 31, 2024, largely due to lower sales, costs attributed to plant closures, and higher selling, general and administrative costs. However, the reversal of a deferred tax valuation allowance significantly reduced income tax expense during the year ended December 31, 2024, resulting in a 65.1% increase in net income. Net income was $12.8 million for the year ended December 31, 2024 compared to $7.8 million from the same period in 2023.

Nine Months Ended September 30, 2025, compared to the Nine Months Ended September 30, 2024:

SRR Holdings, Inc. and Subsidiaries
Nine Months Ended September 30, 2025 and 2024
(Unaudited)										Increase
(In thousands)		2025				2024				(Decrease)				% change
Net sales		$	202,386			$	201,888			$	498				0.2	%
Cost of products and services sold			151,249				158,520				(7,271	)			-4.6	%
Gross profit			51,137				43,368				7,769				17.9	%
			25.3	%			21.5	%
Selling, general and administrative expenses			33,203				31,854				1,349				4.2	%
Operating income			17,934				11,514				6,420				55.8	%
			8.9	%			5.7	%
Other Expenses
Interest expense			(6,000	)			(7,452	)			1,452				-19.5	%
Equity in Earnings of Joint Venture			376				338				38				11.2	%
(Loss) gain on disposal of fixed assets			27				(63	)			90			n/m
Earnings before income taxes			12,337				4,337				8,000				184.5	%
Income tax expense			2,998				1,774				1,224			n/m
NET INCOME			9,339				2,563				6,776				264.4	%
Foreign currency translation adjustment			20				8				12
TOTAL COMPREHENSIVE INCOME		$	9,359			$	2,571			$	6,788				264.0	%

Revenues

For the nine months ended September 30, 2025, net sales of $202.4 million increased 0.2% from the same period in 2024. The sales mix reflected an increase of $4.9 million in product revenues, largely offset by a $4.4 million decrease in services.

Gross Profit

Gross profit of $51.1 million increased 17.9% for the nine months ended September 30, 2025 from the same period in 2024 primarily due to the change in sales mix noted above. Also contributing to the year-on-year improvement was lower material costs and better labor efficiency related to manufactured products. As a result, gross profit as a percentage of sales improved from 21.5% for the nine months ended September 30, 2024 to 25.3% in the same period in 2025.

Selling, General and Administrative Expenses

Selling, general and administrative expenses of $33.2 million for the nine months ended September 30, 2025 increased 4.2% in 2025 from the same period in 2024, primarily due to an increase in sales and sales support initiatives to support the growth of the Royston Group.

Operating Income

Operating income of $17.9 million for the nine months ended September 30, 2025 increased almost 55.8% from the same period in 2024. The increase was primarily due to an increase in gross profit, partly offset by the increased selling, general and administrative expenses.

Other Expense

The largest component of other expense is interest expense on the Company’s outstanding debt. Interest expense of $6.0 million for the nine months ended September 30, 2025 decreased 19.5% from the same period in 2024, primarily due to lower debt balances from scheduled principal payments as well as lower interest rates.

Net Income

Net income of $9.3 million increased 264.4% for the nine months ended September 30, 2025 from the same period in 2024, primarily due to the significant increase in operating income noted above, partially offset by reduced interest expense.

Liquidity and Capital Resources

Year Ended December 31, 2024, compared to Year Ended December 31, 2023:

(In thousands)		Years Ended December 31
		2024				2023
Net cash provided by operating activities			12,265				21,303
Net cash used in investing activities			(3,971	)			(2,246	)
Net cash used in financing activities			(7,258	)			(19,982	)
Effect of exchange rate changes on cash and cash equivalents			(8	)			(28	)
Net increase (decrease in cash and cash equivalents			1,028				(953	)

Royston Group considers its level of cash on hand, borrowing capacity, current ratio and working capital levels to be its most important measures of short-term liquidity. For long-term liquidity indicators, the Company believes its historical levels of net cash flows from operating activities to be an important measure.

At December 31, 2024, the Company had working capital of $28.5 million compared to $23.9 million at December 31, 2023. The ratio of current assets to current liabilities was 1.7 to 1 for the year ended December 31, 2024, and 1.6 to 1 for the year ended December 31, 2023. The increase in working capital between the two reported periods was primarily driven by an increase in accounts receivable and by a decrease in accrued liabilities.

Net cash provided by operating activities was $12.3 million for the year ended December 31, 2024 compared to $21.3 million of net cash provided by operating activities in the same period in 2023. The Company continued to effectively manage its working capital while generating positive cash flow from earnings in both years, resulting in strong cash flows from operating activities.

Net cash used in investing activities was $4.0 million and $2.2 million for the years ended December 31, 2024, and 2023, respectively. The Company continued to invest in equipment and tooling to reduce costs and support sales growth.

Net cash used in financing activities was $7.3 million and $20.0 million for the years ended December 31, 2024 and 2023, respectively, almost all of which represents repayments on debt obligations. The Company continued to generate positive cash flows from its operating activities in order to pay down its outstanding debt.

Nine Months Ended September 30, 2025, compared to the Nine Months Ended September 30, 2024:

		Nine Months Ended
		September 30
		2025				2024
Net cash provided by operating activities			13,009				5,469
Net cash used in investing activities			(3,978	)			(3,464	)
Net cash used in financing activities			(7,291	)			(2,261	)
Effect of exchange rate changes on cash and cash equivalents			20				8
Net increase (decrease in cash and cash equivalents			1,760				(248	)

Royston Group considers its level of cash on hand, borrowing capacity, current ratio and working capital levels to be its most important measures of short-term liquidity. For long-term liquidity indicators, the Company believes its historical levels of net cash flows from operating activities to be an important measure.

At September 30, 2025, the Company had working capital of $6,000 compared to $28.8 million at September 30, 2024. The reduction in working capital was primarily due to the entire senior debt being classified as a current liability as of September 30, 2025. The ratio of current assets to current liabilities was 1.0 to 1 for September 30, 2025, and 1.7 to 1 for September 30, 2024. Excluding the senior debt classified in current liabilities as of September 30, 2025, the increase in working capital between the two reported periods was primarily driven by an increase in cash and inventory and by a decrease in accounts payable and accrued liabilities.

Net cash provided by operating activities was $13.0 million for the nine months ended September 30, 2025, compared to $5.5 million in the same period in 2024, largely due to the increase in earnings. The Company continued to effectively manage its working capital while generating positive cash flows from operating activities in both years.

Net cash used in investing activities was $4.0 million and $3.5 million for the nine months ended September 30,2025, and 2024, respectively. The Company continued to invest in equipment and tooling to reduce costs and support sales growth.

Net cash used in financing activities was $7.3 million and $2.3 million for the nine months ended September 30, 2025 and 2024, respectively, almost all of which represents repayments of debt obligations. The Company continued to generate positive cash flows from operating activities in order to pay down its outstanding debt.

Critical Accounting Policies and Estimates

A summary of significant accounting policies is included in Note 1 to the audited financial statements of the Royston for the years ended December 31, 2024 and 2023.

Exhibit 99.7

Consolidated Financial Statements and Report of Independent Certified Public Accountants

SRR Holdings, Inc. and Subsidiaries

December 31, 2024 and 2023

Contents				Page
Report of Independent Certified Public Accountants				3
Consolidated financial statements
Consolidated balance sheets				5
Consolidated statements of operations and comprehensive income				6
Consolidated statements of shareholders’ equity				7
Consolidated statements of cash flows				8
Notes to consolidated financial statements				9

2

Grant Thornton		REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
1320 Main St., Suite 500
Columbia, SC  29201-6206
F    +1 803 231 3057
D    +1 803 231 3100
		Board of Directors SRR Holdings, Inc. Opinion We have audited the consolidated financial statements of SRR Holdings, Inc. (a Delaware corporation) and subsidiaries (the “Company”), which comprise the consolidated balance sheets as of December 31, 2024 and 2023, and the related consolidated statements of operations and comprehensive income, shareholders’ equity, and cash flows for the years then ended, and the related notes to the consolidated financial statements. In our opinion, the accompanying consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2024 and 2023, and the results of its operations and its cash flows for the years then ended in accordance with accounting principles generally accepted in the United States of America. Basis for opinion We conducted our audits of the consolidated financial statements in accordance with auditing standards generally accepted in the United States of America (US GAAS). Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are required to be independent of the Company and to meet our other ethical responsibilities in accordance with the relevant ethical requirements relating to our audits. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Responsibilities of management for the financial statements Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with accounting principles generally accepted in the United States of America, and for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of consolidated financial statements that are free from material misstatement, whether due to fraud or error. In preparing the consolidated financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern for one year after the date the consolidated financial statements are available to be issued.

GT.COM Grant Thornton LLP is a U.S. member firm of Grant Thornton International Ltd (GTIL). GTIL and each of its member firms are separate legal entities and are not a worldwide partnership.   

3

Auditor’s responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with US GAAS will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the consolidated financial statements.

In performing an audit in accordance with US GAAS, we:

	●	Exercise professional judgment and maintain professional skepticism throughout the audit.
	●	Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements.
	●	Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control. Accordingly, no such opinion is expressed.
	●	Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the consolidated financial statements.
	●	Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern for a reasonable period of time.

We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control-related matters that we identified during the audit.

Columbia, South Carolina
February 20, 2026

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SRR Holdings, Inc. and Subsidiaries

CONSOLIDATED BALANCE SHEETS

December 31, 2024 and 2023

000's except share and per share data		2024				2023
ASSETS
CURRENT ASSETS
Cash and cash equivalents		$	1,516			$	488
Accounts receivable, net			34,448				31,087
Inventories			28,483				28,597
Prepaid expenses			2,417				3,826
Other current assets			202				158
Total current assets			67,066				64,156
Property, plant and equipment, net			18,317				18,471
Right of use assets, finance leases, net			97				41
Right of use assets, operating leases, net			25,772				22,675
Investment in joint venture			1,787				1,018
Deferred tax assets			8,257				-
Intangible assets, net			66,743				74,827
Goodwill, net			11,685				11,685
Total assets		$	199,724			$	192,873
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable		$	14,217			$	13,787
Accrued liabilities			14,553				17,679
Current portion of long-term debt			6,228				6,000
Current portion of finance lease liability			35				17
Current portion of operating lease liability			3,547				2,793
Total current liabilities			38,580				40,276
NONCURRENT LIABILITIES
Long-term debt, less current maturities			77,650				84,639
Finance leases, less current maturities			64				26
Operating lease liability, less current maturities			23,599				20,890
Deferred tax liabilities			-				23
Total liabilities			139,893				145,854
Commitments and contingencies (Notes 7 and 9)
SHAREHOLDERS' EQUITY
Capital stock:
Common stock, $0.01 par value; 1,000,000 shares authorized, 576,750 issued and outstanding as of December 31, 2024 and December 31, 2023, respectively			6				6
Additional paid-in capital			57,675				57,675
Accumulated other comprehensive loss			(68	)			(60	)
Retained earnings (accumulated deficit)			2,218				(10,602	)
Total shareholders’ equity			59,831				47,019
Total liabilities and shareholders’ equity		$	199,724			$	192,873

The accompanying notes are an integral part of these consolidated financial statements

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SRR Holdings, Inc. and Subsidiaries

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME

Years ended December 31, 2024 and 2023

000's		2024				2023
Net sales		$	271,328			$	277,540
Cost of goods sold			210,835				214,365
Gross profit			60,493				63,175
Selling, general and administrative expenses			42,818				40,230
Operating income			17,675				22,945
Other expense
Interest expense			(9,502	)			(10,890	)
Equity in earnings of joint venture			355				220
(Loss) gain on disposal of fixed assets			(718	)			11
Other expense, total			(9,865	)			(10,659	)
Earnings before income taxes			7,810				12,286
Income tax (benefit) provision			(5,010	)			4,522
NET INCOME		$	12,820			$	7,764
Foreign currency translation adjustment			(8	)			(28	)
TOTAL COMPREHENSIVE INCOME		$	12,812			$	7,736

The accompanying notes are an integral part of these consolidated financial statements

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SRR Holdings, Inc. and Subsidiaries

CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

Years ended December 31, 2024 and 2023

000's except share and per share data

										Additional				Accumulated other				Retained earnings
		Common Stock								Paid-in				comprehensive				(accumulated
		Shares				Amount				Capital				loss				deficit)				Total
Balance, December 31, 2022			576,750			$	6			$	57,675			$	(32	)		$	(18,366	)		$	39,283
Net income																			7,764				7,764
Foreign currency translation adjustment			-				-				-				(28	)			-				(28	)
Balance, December 31, 2023			576,750			$	6			$	57,675			$	(60	)		$	(10,602	)		$	47,019
Net income																			12,820				12,820
Foreign currency translation adjustment			-				-				-				(8	)			-				(8	)
Balance, December 31, 2024			576,750			$	6			$	57,675			$	(68	)		$	2,218			$	59,831

The accompanying notes are an integral part of these consolidated financial statements

7

SRR Holdings, Inc. and Subsidiaries

CONSOLIDATED STATEMENTS OF CASH FLOWS

Years ended December 31, 2024 and 2023

000's		2024				2023
Cash flows from operating activities:
Net income		$	12,820			$	7,764
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation			3,032				3,047
Amortization of intangible assets			8,084				8,180
Loss (gain) on disposal of property, plant and equipment			718				(11	)
Change in allowance for doubtful accounts			(73	)			(281	)
Amortization of deferred debt issue costs			471				419
Amortization of operating ROU asset			3,802				3,856
Gain on investment in joint venture			(355	)			(220	)
Deferred income taxes			(8,280	)			84
Changes in assets and liabilities:
Accounts receivable			(3,288	)			3,009
Other assets			(44	)			137
Inventories			114				3,630
Prepaid expenses			1,409				(1,008	)
Accounts payable			415				(4,601	)
Accrued liabilities, other current liabilities and other noncurrent liabilities			(6,560	)			(2,702	)
Net cash provided by operating activities			12,265				21,303
Cash flows from investing activities:
Purchases of property, plant and equipment			(3,851	)			(2,454	)
Proceeds from the sale of property, plant and equipment			294				11
Distributions from joint venture			-				197
Equity investment in joint venture			(414	)			-
Net cash used in investing activities			(3,971	)			(2,246	)
Cash flows from financing activities:
Payment of debt issuance costs			(22	)			(1,510	)
Borrowings on term loan			-				4,700
Repayments on term loan			(7,210	)			(12,142	)
Repayment of finance leases			(26	)			(30	)
Borrowings on revolving line of credit			59,188				17,139
Repayments on revolving line of credit			(59,188	)			(28,139	)
Net cash used in financing activities			(7,258	)			(19,982	)
Effect of exchange rate changes on cash, cash equivalents			(8	)			(28	)
Net increase (decrease) in cash and cash equivalents			1,028				(953	)
Cash and cash equivalents, beginning of period			488				1,441
Cash and cash equivalents, end of period		$	1,516			$	488
Supplemental disclosure - Cash paid for interest		$	9,182			$	11,224
Supplemental disclosure - Cash paid for income taxes		$	3,312			$	3,613
Supplemental disclosure - Capital asset purchases in accounts payable		$	15			$	137

The accompanying notes are an integral part of these consolidated financial statements

8

SRR Holdings, Inc. and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2024 and 2023

'000's except share and per share data

NOTE 1 - NATURE OF BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES

Organization and Nature of Business

SRR Holdings, Inc. and Subsidiaries (collectively, the “Company”) is a Delaware corporation. Through their wholly owned primary operating subsidiaries, the Company’s operations consist of the following:

• Royston, LLC (“Royston”) -  designing, manufacturing, selling, and installing convenience and grocery store equipment, including check stands, sales and customer service centers, preparation counters, coffee/beverage islands, beverage tower systems, heated food merchandising systems, counters and countertops, shelving and kiosks; and laboratory furniture and fume hoods sold under the Hamilton brand name; and

• SignResource, LLC (“SignResource”) - designing, manufacturing, selling, installing and servicing outdoor signage, in-store sign solutions and related design elements; and

• Southern CaseArts (“SCA”) - designing, manufacturing and selling refrigerated and heated display cases, refrigerated island merchandisers, self-service cases, and combination cases.

A summary of the Company’s significant accounting policies follows.

Principles of Consolidation

The accompanying consolidated financial statements include the accounts of Royston, SignResource and SCA. All intercompany transactions and balances have been eliminated in consolidation.

Revenue Recognition

The Company recognizes revenue using the five-step model prescribed by ASC 606, which requires us to: (1) identify the contract with the customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to the performance obligations in the contract; and (5) recognize revenue when, or as, an entity satisfies a performance obligation.

A contract with a customer is identified when it has approval and commitment from both parties, the rights of the parties are identified, payment terms are identified, the contract has commercial substance and collectability of consideration is probable.

The Company accepts returns or claims for goods having quality defects or for other reasons such as disagreements or improper delivery. When revenue is recorded, estimates of returns are made and recorded as a reduction of revenue. 

Recognition of Material Performance Obligations

Product sales - This performance obligation is satisfied at a point in time when the control of the product passes to the customer. This is generally at a point in time upon shipment for product sales.

Project management services - Since the customer simultaneously receives and consumes the benefits throughout the process, this performance obligation is satisfied over the period of time the service is performed for the customer.  There have been no significant contract assets or liabilities recorded as of March 31, 2025 and 2024.

Disaggregation of revenues - Timing of revenue recognition for the years ended December 31, 2024 and 2023 is shown below:

		2024				2023
Net sales transferred at a point in time		$	226,680			$	230,778
Net sales transferred over time			44,648				46,762
		$	271,328			$	277,540

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SRR Holdings, Inc. and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2024 and 2023

'000's except share and per share data

Fair Value of Financial Instruments

Because of their short maturities, the fair value of cash and cash equivalents, accounts receivable, accounts payable and other accrued liabilities are not materially different than their carrying amounts, as reported. The fair value of debt instruments is estimated to approximate carrying amounts since interest rates on these obligations adjust frequently and approximate the rates at which the Company could obtain similar financing at December 31, 2024 and 2023.

Cash and Cash Equivalents

For purposes of reporting the statements of cash flows, the Company considers all cash accounts and all highly liquid financial instruments purchased with an original maturity of three months or less to be cash and cash equivalents. Cash deposits are held in federally insured institutions.  Uninsured domestic held deposits as of December 31, 2024 and 2023 were $1,156 and $1,639, respectively, and China uninsured deposits were $0 and $211, respectively.

Management performs periodic evaluations of the relative credit standing of the financial institution and believes the risk of loss to be remote.

Accounts Receivable and Allowance for Doubtful Accounts

Accounts receivable are initially recognized at their sales price. Accounts receivable are considered past due or delinquent when payment is not received within the credit terms extended to the customer. An allowance for estimated credit losses on accounts receivable is provided based on analysis of historical losses and recoveries. Receivables are written off when deemed to be uncollectible. Accounts receivable are net of an allowance for doubtful accounts of $295 and $368 as of December 31, 2024 and 2023, respectively. The Company does not charge interest or late fees on past due accounts and generally does not require collateral.

While the relative significance of any particular customer varies from period to period, the loss of, or significant curtailments of, purchases of goods and services by one or more of the Company’s significant customers at any time would adversely affect revenues and cash flows. The following table summarizes customers generating significant revenues for the Company for the years ended December 31, 2024 and 2023, as well as those representing a significant portion of the accounts receivable balances as of December 31, 2024 and 2023:

		2024				2024				2023				2023
Customer		Revenues				Accounts Receivable				Revenues				Accounts Receivable
Customer A			30	%			52	%			29	%			41	%
Customer B			12	%			**				10	%			**
Customer C			*				**				10	%			**

* This customer did not have revenues in excess of 10% of the Company's total revenues in 2024.

** This customer did not have accounts receivable in excess of 10% of the Company's total accounts receivable balance.

Inventories

Inventories are valued at the lower of cost or net realizable value. Cost is determined on the basis of weighted average and first-in, first-out (FIFO) methods. The Company assesses inventory on hand periodically for slow moving, obsolete, or damaged product. The carrying value of the slow moving, obsolete, and damaged products are reduced to their estimated net realizable value.

Deferred Debt Issue Costs

Deferred debt issue costs are being amortized over the term of the underlying debt agreements using the effective interest method. Amortization expense of $471 and $419 for the years ended December 31, 2024 and 2023, respectively, is recognized in interest expense. As of December 31, 2024 and 2023, gross deferred debt issue costs were $3,619 and $3,597, respectively, and accumulated amortization was $2,768 and $2,297, respectively.

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SRR Holdings, Inc. and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2024 and 2023

'000's except share and per share data

Estimated amortization expense for deferred debt issue costs for the next three years is as follows:

		Amount
2025		$	481
2026			318
2027			52
		$	851

Goodwill

Goodwill represents the excess of the cost of an acquired entity over the net amount assigned to assets acquired, including other identifiable intangible assets, and liabilities assumed in a business combination. Goodwill is not amortized however it is subject to review for impairment. There was no impairment recognized for the years ended December 31, 2024 and 2023. 

Long-Lived Assets

The Company reviews long-lived assets for impairment when events or changes in business conditions indicate that their full carrying value may not be recoverable. Intangible assets with definite lives, comprised primarily of trademarks, proprietary manufacturing processes, and customer relationships, are amortized over their estimated useful lives and evaluated for impairment consistent with other long-lived assets. Recoverability of long-lived assets is assessed by comparison of the carrying amount of the asset to the estimated future net cash flows expected to be generated by the asset. If estimated future net cash flows are less than the carrying amount of the asset, the asset is impaired, and an expense is recorded in an amount required to reduce the carrying amount of the asset to its fair value. There was no impairment recognized for the years ended December 31, 2024 and 2023.

Property, Plant and Equipment

Property, plant and equipment are stated at cost. Major additions and improvements are capitalized, while maintenance and repairs that do not improve the utility or extend the lives of the respective assets are expensed. The carrying amounts of assets that are sold or retired, and the related accumulated depreciation, are removed from the accounts in the year of disposal, and any resulting gain or loss is reflected in the statements of operations and comprehensive loss in other expenses.

Leases 

Under ASC Topic 842, a lease is a contract, or part of a contract, that conveys the right to control the use of identified property, plant or equipment for a perioed of time in exchange for consideration.  The Company primarily leases manufacturing plants, typically with office space, and equipment under lease agreements. The Company determines if an arrangement is a lease at inception. The Company elected an accounting policy by class of underlying asset to combine lease and non-lease components. 

For leases with terms greater than 12 months, the Company records the related asset and obligation at the present value of lease payments over the term. Leases expire at various dates from 2025 through 2035, with varying renewal and termination options. The length of lease terms include options to extend or terminate the lease when it is reasonably certain such option will be exercised. The Company has certain leases that contain lease and non-lease components and has elected the practical expedient to account for these components as a single lease component.  The Company also made an accounting policy election to forego capitalization of leases with an initial term of 12 months or less.  

Right-of-use (“ROU”) assets and lease liabilities are recognized based on the present value of lease payments over the lease term as of the commencement date. Because most of the Company’s leases do not provide an explicit or implicit rate of return, the incremental borrowing rate used is based on the information available at the commencement date in determining the present value of lease payments on an individual lease basis. The incremental borrowing rate for a lease is the rate of interest the Company would have to pay on a collateralized basis to borrow an amount equal to the lease payments for the asset under similar terms.  

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SRR Holdings, Inc. and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2024 and 2023

'000's except share and per share data

The Company monitors events or changes in circumstances that change the timing or amount of future lease payments which results in the remeasurement of a lease liability, with a corresponding adjustment to the ROU asset. ROU assets for operating and financing leases are periodically reviewed for impairment losses under ASC 360-10, Property, Plant, and Equipment, to determine whether a ROU asset is impaired, and if so, the amount of the impairment loss to recognize.   There was no impairment recognized for the years ended December 31, 2024 and 2023.

Income Taxes

The Company follows the asset and liability method of accounting for income taxes. Under this method, current income taxes are recognized for the estimated income taxes payable for the current period. Deferred income tax assets and liabilities are determined based on differences between financial reporting and tax bases of assets and liabilities and on unutilized tax losses carried forward and measured using enacted tax rates and laws that will be in effect when the differences are expected to reverse. A valuation allowance is recognized to the extent that the recoverability of deferred income tax assets is not considered more likely than not.

Management believes that there is appropriate support for the income tax positions taken and to be taken on income tax returns and that income tax receivables and accruals for tax liabilities are adequate for all open years based on an assessment of many factors, including past experience and interpretations of tax laws applied to the facts of each matter. Accordingly, a liability has not been recognized as a result of applying the applicable authoritative standards on accounting for uncertainty in income taxes as of December 31, 2024 and 2023.

Tax years 2021 through 2024 remain open to examination by the tax authorities under the statute of limitations.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Foreign Currency Translation

The Company’s subsidiary in China prepares their financial statements using the Chinese Yuan as the functional currency. Accordingly, the Company’s consolidated foreign currency translation gains and losses are included in accumulated other comprehensive loss. The consolidated translation loss included in equity amounted to $8 and $28 for the years ended  December 31, 2024 and 2023, respectively. Deferred income taxes are not provided on currency translation adjustments as foreign earnings are considered to be permanently reinvested.

Investment in Joint Venture

The Company is part of a joint venture agreement with Tam-Mex, S.A. de C.V., a manufacturer located in Mexico City, Mexico, to market and distribute products in Mexico. The respective partners each own 50% of the corporate capital of the joint venture company, Royston Tammex S DE RL DE CV. This is accounted for under equity method of accounting. The initial capital contribution to the joint venture by the Company was $31, which includes an initial capital contribution of $10, plus an additional $21 for 50% of the cost of start-up tooling. During 2024, the Company made an additional capital contribution of $414. The Company has recognized $355 and $220 in income from the joint venture for the years ended December 31, 2024 and 2023, respectively.

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SRR Holdings, Inc. and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2024 and 2023

'000's except share and per share data

NOTE 2 - INVENTORIES

The components of inventories as of December 31, 2024 and 2023 are as follows:

		2024				2023
Raw materials		$	17,223			$	16,991
Work-in-process			5,572				6,637
Finished goods			8,800				8,388
			31,595				32,016
Less: Reserve for slow-moving, obsolete and damaged inventory			(3,112	)			(3,419	)
		$	28,483			$	28,597

NOTE 3 - PROPERTY, PLANT AND EQUIPMENT, NET

Depreciation is computed for financial reporting purposes using the straight-line method over the estimated useful lives of the assets. Leasehold improvements are depreciated using the straight-line method over the remaining life of the applicable lease when the life of the lease is less than the related useful life of the asset. 

Property, plant and equipment as of December 31, 2024 and 2023, are as follows:

		2024				2023				Useful Lives (in years)
Leasehold improvements		$	4,674			$	3,521			2	-	15
Machinery and equipment			28,402				30,429			2	-	19
Trucks and autos			401				372			3	-	5
Computer equipment and software			971				1,359			2	-	5
Furniture, fixtures and other			574				783			2	-	10
Construction in progress			2,155				984
			37,177				37,448
Less - Accumulated depreciation			(18,860	)			(18,977	)
		$	18,317			$	18,471

Depreciation expense was $3,032 and $3,047 for the years ended December 31, 2024 and 2023, respectively.

NOTE 4 - INTANGIBLE ASSETS

The components of intangible assets as of December 31, 2024 and 2023 are as follows:

		2024				2023				Useful Lives (in years)
Trade names		$	43,510			$	43,510			15
Trade names			1,440				1,440			Indefinite
Proprietary manufacturing process			7,680				7,680			3	-	12
Customer relationships			67,480				67,480			3	-	15
			120,110				120,110
Less - Accumulated amortization - Trade names			(19,143	)			(16,212	)
Less - Accumulated amortization - Proprietary manufacturing process			(4,537	)			(3,929	)
Less - Accumulated amortization - Customer relationships			(29,687	)			(25,142	)
		$	66,743			$	74,827

Amortization expense was $8,084 and $8,180 for the years ended December 31, 2024 and 2023.

13

SRR Holdings, Inc. and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2024 and 2023

'000's except share and per share data

Estimated amortization expense, for the next five years and thereafter, as of December 31, 2024, is as follows:

		Amount
2025		$	8,018
2026			7,974
2027			7,974
2028			7,974
2029			7,974
Thereafter			25,389
		$	65,303

NOTE 5 - GOODWILL

The carrying values of goodwill are reviewed at least annually for possible impairment or whenever events or changes in circumstances indicate that goodwill may be impaired. The Company first assesses qualitative factors in order to determine if goodwill is impaired. If, through qualitative assessment, it is determined that it is more likely than not that the goodwill is not impaired, no further testing is required. If it is determined that it is more likely than not that the goodwill is impaired, or if the Company elects not to first assess qualitative factors, the Company’s impairment testing continues with the estimation of the fair value of the reporting unit using a combination of a market approach and an income (discounted cash flow) approach, at the reporting-unit level. The estimation of the fair value of the reporting unit requires significant management judgment with respect to revenue and expense growth rates, changes in working capital, and the selection and use of an appropriate discount rate. The estimates of the fair value of reporting units are based on the best information available as of the date of the assessment. The use of different assumptions could increase or decrease estimated future discounted operating cash flows and could increase or decrease an impairment charge. Company management uses its judgment in assessing whether assets may have become impaired between annual impairment tests. Indicators such as adverse business conditions, economic factors, and technological or competitive activities may signal that an asset has become impaired.

The Company identified its reporting units in conjunction with its annual goodwill impairment testing. The Company has a total of two reporting units that contain goodwill. The Company relies upon a number of factors, judgments, and estimates when conducting its impairment testing, including, but not limited to, the Company’s operating results, forecasts, anticipated future cash flows, and marketplace data. There are inherent uncertainties related to these factors and the judgments applied in the analysis of goodwill impairment.

The following presents information about the Company's goodwill on the dates or for the periods indicated:

		SignResource, LLC				Royston, LLC				Southern CaseArts				Total
Balance as at December 31, 2022
Goodwill		$	26,049			$	11,183			$	502			$	37,734
Goodwill acquired		$	-			$	-			$	-			$	-
Accumulated impairment losses		$	(26,049	)		$	-			$	-			$	(26,049	)
Balance as at December 31, 2023		$	-			$	11,183			$	502			$	11,685
Balance as at December 31, 2023
Goodwill		$	26,049			$	11,183			$	502			$	37,734
Goodwill acquired		$	-			$	-			$	-			$	-
Accumulated impairment losses		$	(26,049	)		$	-			$	-			$	(26,049	)
Balance as at December 31, 2024		$	-			$	11,183			$	502			$	11,685

14

SRR Holdings, Inc. and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2024 and 2023

'000's except share and per share data

NOTE 6 - LONG-TERM DEBT

Credit Agreement

On March 9, 2018, the Company entered into a credit agreement (the “Credit Agreement”) with a third-party lending institution, which included a Term Loan and a Revolving Credit Facility.  The Credit Agreement was amended on July 28, 2022 and again on July 27, 2023 as discussed in more detail below.   The Credit Agreement is collateralized by a security interest in substantially all of the present and future assets of the Company.

Term Loan

The Company's initial Term Loan of $50,000 with maturity date of March 9, 2023, was revised on July 27, 2018 with an increase to $60,000 and the maturity date extended to July 27, 2023.  On July 27, 2023, the Company refinanced its senior debt, extending the maturity date to July 27, 2026. The revised Term Loan’s principal amount was $60,000, repayable in quarterly installments, with a balloon payment of the remaining principal due at maturity.

The Company’s senior loans mature on July 27, 2026.  Based on the Company’s available cash balances and projected cash flows from operations, the Company does not expect to have sufficient liquidity to make the required balloon payment on the senior debt which comes due in July 2026.  However, based on the Company’s history of successfully refinancing its debt obligations as well as its strong financial position and operating performance, the Company expects to refinance the senior debt in the normal course of business on or before July 2026.  It is expected the subordinated debt which comes due in July 2027 will also be extended consistent with the senior debt refinancing.  The largest lenders of the senior debt syndicate have indicated interest in renewing the credit facility and the Company does not expect significant changes in the terms or interest rates compared to the current debt facilities.  

The loan bears interest at a rate equal to the Base Rate or Adjusted Term Secured Overnight Financing Rate (SOFR) for such interest period, as stipulated in the executed Credit Agreement and selected by the Company, plus the applicable margin. SOFR is a reference rate that is used by parties in commercial contracts that is outside their direct control, established as an alternative to LIBOR.  The applicable margin is based on the Company’s senior leverage ratio as defined by the Credit Agreement. The interest rate for the Term Loan as of December 31, 2024 and 2023 was 8.47% and 9.19%, respectively. Interest on the Term Loan determined using the SOFR Rate is paid monthly or quarterly dependent on the rate periodically selected by the Company.

Revolving Credit Facility

The Credit Agreement includes a revolving credit facility (“Revolver”), initially set at a borrowing limit of $15,000. This limit was raised to $25,000 following an amendment to the agreement on July 27, 2018 and to $30,000 following another amendment to the agreement on July 27, 2023. There were $0 outstanding borrowings as of December 31, 2024 and 2023, respectively. Total available for additional borrowings under the Revolver was $28,730 and $28,855 as of December 31, 2024 and 2023, respectively. The maturity date for the Revolver is July 27, 2026.

All Base Rate Advances of the Revolving Credit and Swing Line shall bear interest at a per annum interest rate equal to the Base Rate plus the Applicable Margin. All Term SOFR Advances of the Revolving Credit bear interest for each Interest Period at a per annum interest rate equal to Adjusted Term SOFR for such Interest Period plus the Applicable Margin and all Quoted Rate Advances of the Swing Line shall bear interest at a per annum interest rate equal to the Quoted Rate plus the Applicable Margin, if any. Interest accruing at the Base Rate shall be computed on the basis of a 360-day year and assessed for the actual number of days elapsed, and in such computation effect shall be given to any change in the interest rate resulting from a change in the Base Rate on the date of such change in the Base Rate. Interest on the Revolver is payable monthly.

15

SRR Holdings, Inc. and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2024 and 2023

'000's except share and per share data

Subordinated Note

The Company obtained a Subordinated Note worth $13,000 on March 9, 2018, with an initial maturity date of March 9, 2025. This note was modified on July 27, 2018, increasing the note’s value to $30,000 and extending the maturity date to July 27, 2024. A second amendment to the Subordinated Note was made on July 27, 2023, extending the maturity date further to July 27, 2027, without any other significant alterations to the note. The note accrues interest at an annual rate of 11% on the outstanding principal, payable quarterly in arrears.  The balance of the Subordinated Note, including paid-in-kind interest, was $33,439 on September 30, 2025 and 2024.

The Company was in compliance with the debt covenants (as amended) for all reporting periods.

Derivatives and Hedging Activities

The Company is party to an interest rate swap agreement effective October 2023 to economically hedge the interest rate risk associated with the variable interest rates on a portion of its long-term debt.  The notional amount is $17,500 and $19,500 at December 31, 2024 and 2023, respectively, and is reduced quarterly through July 2026 to $13,500.  The fair value of the swap was not material at December 31, 2024 and 2023.

Letters of credit

As of December 31, 2024 and 2023, respectively, the outstanding letters of credit issued in terms of the credit agreement were $1,270 and $1,145. The beneficiaries are Hartford Fire Insurance Company, increasing from $705 to $830 and Great American Insurance Company $440.

The balances as of December 31, 2024 and 2023 were as follows:

		2024				2023
Term loan		$	51,290			$	58,500
Subordinated note			33,439				33,439
Less - unamortized deferred financing costs related to the term loan			(851	)			(1,300	)
			83,878				90,639
Less - current portion			(6,228	)			(6,000	)
		$	77,650			$	84,639

Scheduled maturities of the term loan, subordinated note, and revolving facility as of December 31, 2024, are as follows:

		Amount
2025			6,228
2026			45,062
2027			33,439
			84,729

NOTE 7 - LEASES

The following table presents the carrying value of leases and the classification within the consolidated balance sheet (remaining lease terms are between 1 months and 10.6 years):

	Classification		2024				2023
Operating lease liabilities	Current		$	3,547			$	2,793
Operating lease liabilities	Non-current		$	23,599			$	20,890
ROU asset, operating leases	Non-current		$	25,772			$	22,675
Finance lease liabilities	Current		$	35			$	17
Finance lease liabilities	Non-current		$	64			$	26
ROU asset, finance leases	Non-current		$	97			$	41

16

SRR Holdings, Inc. and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2024 and 2023

'000's except share and per share data

The following summarizes the lease costs included within the consolidated statements of operations and comprehensive income.  Substantially all of the lease expenses are recorded in cost of goods sold, with an insignificant amount recorded in selling, general and administrative expenses, for the years ended December 31, 2024 and 2023, respectively.  

		2024				2023
Finance leases		$	41			$	67
Operating leases		$	5,436			$	5,102
Short-term leases		$	491			$	511

Future minimum payments under noncancelable operating leases, due in each of the next 5 years and thereafter as of December 31, 2024, are as follows:

Year Ending:
2025		$	5,433
2026			5,506
2027			5,502
2028			4,292
2029			2,465
Thereafter			12,125
Total minimum lease payments			35,323
Less: Imputed interest		$	(8,177	)
		$	27,146

Future minimum payments under noncancelable finance leases, due in each of the next 5 years and thereafter as of December 31, 2024, are as follows:

Year Ending:
2025		$	42
2026			33
2027			25
2028			12
2029			-
Thereafter			-
Total minimum lease payments			112
Less: Imputed interest		$	(13	)
		$	99

		2024				2023
The following table presents additional information about lease obligations:
Weighted-average Operating lease term (years)			7.62				9.16
Weighted-average Operating lease discount rate			7.49	%			7.03	%
Weighted-average Finance lease term (years)			2.87				2.66
Weighted-average Finance Lease discount rate			8.08	%			7.88	%

		2024				2023
The following table presents supplemental cash flow information:
Cash paid for amounts included in measurement of lease liabilities
Operating cash flows for operating leases		$	5,456			$	5,016
Right-of-use assets obtained in exchange for lease obligations (non-cash)
Operating leases		$	6,916			$	6,407

17

SRR Holdings, Inc. and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2024 and 2023

'000's except share and per share data

NOTE 8 - EMPLOYEE BENEFIT PLANS

The Company has 401(k) retirement savings plans covering substantially all domestic full-time employees.  These Plans were merged into one plan on August 1, 2023. The Company makes contributions to these plans based on employee contributions. Related expenses were $938 and  $1,043 for the years ended December 31, 2024 and 2023, respectively.

NOTE 9 - LITIGATION

The Company is involved in various legal proceedings encountered in the normal course of business. In the opinion of management, the resolution of these matters will not have a material adverse effect on the Company’s financial position.

NOTE 10 - INSURANCE RESERVES

The Company has insurance policies for medical and workers’ compensation benefits that contain significant deductibles. The cost of general medical and workers’ compensation claims, up to the deductibles, is accrued annually based on actual claims reported plus estimated amounts for claims not reported. These estimates are based on historical information, along with certain assumptions about future events, and are subject to change as additional information becomes available. As of December 31, 2024 and 2023, the Company accrued $1,875 and $2,233, respectively, for general medical and workers’ compensation claims within accrued liabilities in the consolidated balance sheets.

NOTE 11 - INCOME TAXES

The major components of income tax (benefit) provision are as follows:

		2024				2023
Current income tax provision:
Federal		$	2,869			$	3,969
State			401				469
Deferred income tax (benefit) provision:
Federal			(7,201	)			1
State			(1,079	)			83
		$	(5,010	)		$	4,522
Reconcilition of effective tax rate:
Income tax provision at statutory rate			21.0	%			21.0	%
Increase (decrease) in income tax provision due to:
State and local taxes, net			-10.0	%			3.3	%
Permanent differences			0.8	%			0.2	%
Change in valuation allowance			-76.1	%			13.9	%
Other			0.2	%			-1.6	%
Total provision for income tax			-64.1	%			36.8	%
Total income tax (payable) receivable:
Federal			(209	)			(29	)
State			411				187
		$	202			$	158

18

SRR Holdings, Inc. and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2024 and 2023

'000's except share and per share data

Deferred income tax assets and liabilities result from differences between the carrying amount and the tax bases of the following:

		2024				2023
Deferred tax assets:
Inventories		$	901			$	961
Interest carryforward			3,740				3,052
Accrued expenses			265				178
Net operating losses			118				178
Intangibles			3,541				4,212
Lease liability			6,591				5,723
Capitalized research expenses			2,930				2,137
Other deferred tax assets			188				194
		$	18,274			$	16,635
Valuation allowance			-				(7,007	)
Net deferred tax assets		$	18,274			$	9,628
Deferred tax liabilities:
Property and equipment			(3,064	)			(3,573	)
ROU Asset			(6,257	)			(5,478	)
Other deferred tax liabilities			(696	)			(600	)
			(10,017	)			(9,651	)
Net deferred tax assets (liabilities)		$	8,257			$	(23	)

The Company recognizes the amount of taxes payable or refundable for the current year and recognizes deferred tax liabilities and assets for the expected future tax consequences of events and transactions that have been recognized in the Company’s financial statements or tax returns.

The Company's effective tax rate differs from the federal statutory rate primarily due to valuation allowance released that was previously recorded against certain deferred tax assets as well as state taxes. 

The Company files tax returns in each jurisdiction where they are registered to do business. In the United States and many of the state jurisdictions, and in the foreign country where the Company files tax returns, a statute of limitations period exists. After a statute period expires, the tax authorities may no longer assess additional income tax for the expired period. In addition, the Company is no longer eligible to file claims for refund for any tax that it may have overpaid. Pre-tax NOL carryforwards at December 31, 2024 were approximately $2.2 million for state purposes and will begin expiring at various amounts and dates for state purposes beginning in 2029.

Deferred income taxes are provided for the temporary differences between the financial reporting basis and the tax basis of the Company’s assets and liabilities. In assessing the recoverability of deferred income tax assets, management considers whether it is more likely than not that some portion or all of the deferred income tax assets will not be realized. The ultimate realization of deferred income tax assets is dependent upon the generation of future taxable income during the period in which the temporary differences become deductible. Management considers the projected future taxable income and tax planning strategies in making this assessment. Based on the cumulative historical income over the past three years and projected future income, management believes it is more likely than not that the Company will be able to realize the benefits of certain deferred income tax assets as of December 31, 2024. Furthermore, management has analyzed the realization of the interest expense carryforward deferred tax asset. According to the Company's projected future income and interest expense, management expects to realize historical interest expense carryforward starting in 2025.  As such, management has determined not to record a valuation allowance on December 31, 2024.

19

SRR Holdings, Inc. and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2024 and 2023

'000's except share and per share data

NOTE 12 - STOCK OPTION PLAN

The Company has a stock-based incentive plan for directors and key employees, which is administered by the Company’s Board of Directors. Stock options vest upon a sale of the Company or upon an initial public offering of the Company in which the holders of shares of common stock of the Company achieve a minimum internal rate of return as determined by the Board of Directors and set forth in the stock option agreement of each holder. As of December 31, 2024 and 2023, no options have vested, and no related compensation expense has been recorded.

Stock options terminate 10 years after the effective date of grant. Outstanding stock options as of December 31, 2024 are as follows:

		Number of Options				Weighted- Average Exercise Price				Remaining Contractual Term (in years)
Balance at December 31, 2022			44,253
Options granted			-			$	100				7.1
Options forfeited/reduced			(727	)			100
Balance at December 31, 2023			43,526
Options granted			3,000				100				9.7
Options forfeited/reduced			(2,000	)			100
Balance at December 31, 2024			44,526
Vested and unvested expected to vest at December 31, 2024			-
Exercisable at December 31, 2024			-

NOTE 13 - RELATED-PARTY TRANSACTIONS

As of December 31, 2024 and 2023, the Company was party to a management agreement with its majority shareholder. Under the agreement, the majority shareholder performs certain services for the Company including, but not limited to, consultation on corporate strategy, budgeting of future corporate investments, acquisition and divestiture strategies, and debt and equity financings. Management fees expensed and paid during the years ended December 31, 2024 and 2023 were $753 and $757, respectively.  Management fees payable were $350 at December 31, 2024 and 2023 respectively.  The Company also receives management fees for similar services provided to a joint venture, Royston Tammex S DE RL DE CV. Management fees received during the years ended December 31, 2024 and 2023 were $641 and $328, respectively.

NOTE 14 - SUBSEQUENT EVENTS

The Company has evaluated subsequent events through February 20, 2026, the date these consolidated financial statements were available to be issued. All subsequent events requiring recognition or disclosure have been incorporated into these consolidated financial statements.

20

Exhibit 99.8

Consolidated Financial Statements

SRR Holdings, Inc. and Subsidiaries

September 30, 2025 and 2024

1

Contents	Page
Consolidated financial statements (Unaudited)
Consolidated balance sheets	4
Consolidated statements of operations and comprehensive income	5
Consolidated statements of shareholders’ equity	6
Consolidated statements of cash flows	7
Notes to consolidated financial statements	8

2

SRR Holdings, Inc. and Subsidiaries

CONSOLIDATED BALANCE SHEETS

September 30, 2025 and 2024

(UNAUDITED)

000's except share and per share data		2025				2024
ASSETS
CURRENT ASSETS
Cash and cash equivalents		$	3,276			$	240
Accounts receivable, net			35,696				35,902
Inventories			30,564				28,101
Prepaid expenses			4,587				4,746
Other current assets			2,494				910
Total current assets			76,617				69,899
Property, plant and equipment, net			20,717				19,228
Right of use assets, finance leases, net			132				104
Right of use assets, operating leases, net			22,990				26,730
Investment in joint venture			1,697				1,771
Deferred tax assets			5,260				-
Intangible assets, net			60,719				68,756
Goodwill, net			11,685				11,685
Total assets		$	199,817			$	198,173
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable		$	12,072			$	13,017
Accrued liabilities			16,873				18,711
Current portion of long-term debt			43,730				5,862
Current portion of finance lease liability			47				35
Current portion of operating lease liability			3,889				3,468
Other current liabilities			-				-
Total current liabilities			76,611				41,093
NONCURRENT LIABILITIES
Long-term debt, less current maturities			33,276				82,910
Finance leases, less current maturities			60				71
Operating lease liability, less current maturities			20,680				24,486
Deferred tax liabilities			-				23
Total liabilities			130,627				148,583
Commitments and contingencies (Notes 7 and 9)
SHAREHOLDERS' EQUITY
Capital stock:
Common stock, $0.01 par value; 1,000,000 shares authorized, 576,750 issued and outstanding as of September 30, 2025 and 2024, respectively			6				6
Additional paid-in capital			57,675				57,675
Accumulated other comprehensive loss			(48	)			(52	)
Retained earnings (accumulated deficit)			11,557				(8,039	)
Total shareholders’ equity			69,190				49,590
Total liabilities and shareholders’ equity		$	199,817			$	198,173

The accompanying notes are an integral part of these consolidated financial statements

3

SRR Holdings, Inc. and Subsidiaries

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME

Nine months ended September 30, 2025 and 2024

(UNAUDITED)

000's		2025				2024
Net sales		$	202,386			$	201,888
Cost of goods sold			151,249				158,520
Gross profit			51,137				43,368
Selling, general and administrative expenses			33,203				31,854
Operating income			17,934				11,514
Other expense
Interest expense			(6,000	)			(7,452	)
Equity in earnings of joint venture			376				338
Gain (loss) on disposal of fixed assets			27				(63	)
Other expense, total			(5,597	)			(7,177	)
Earnings before income taxes			12,337				4,337
Income tax provision			2,998				1,774
NET INCOME		$	9,339			$	2,563
Foreign currency translation adjustment			20				8
TOTAL COMPREHENSIVE INCOME		$	9,359			$	2,571

The accompanying notes are an integral part of these consolidated financial statements

4

SRR Holdings, Inc. and Subsidiaries

CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

Nine months ended September 30, 2025 and 2024

000's except share and per share data

(UNAUDITED)

										Additional				Accumulated other				Retained earnings
		Common Stock								Paid-in				comprehensive				(accumulated
		Shares				Amount				Capital				loss				deficit)				Total
Balance, December 31, 2023			576,750			$	6			$	57,675			$	(60	)		$	(10,602	)		$	47,019
Net income																			2,563				2,563
Foreign currency translation adjustment			-				-				-				8				-				8
Balance, September 30, 2024			576,750			$	6			$	57,675			$	(52	)		$	(8,039	)		$	49,590
Balance December 31, 2024			576,750			$	6			$	57,675			$	(68	)		$	2,218			$	59,831
Net income																			9,339				9,339
Foreign currency translation adjustment			-				-				-				20				-				20
Balance, September 30, 2025			576,750			$	6			$	57,675			$	(48	)		$	11,557			$	69,190

The accompanying notes are an integral part of these consolidated financial statements

5

SRR Holdings, Inc. and Subsidiaries

CONSOLIDATED STATEMENTS OF CASH FLOWS

Nine months ended September 30, 2025 and 2024

(UNAUDITED)

000's		2025				2024
Cash flows from operating activities:
Net income		$	9,339			$	2,563
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation			2,112				2,230
Amortization of intangible assets			6,024				6,071
(Gain) loss on disposal of property, plant and equipment			(27	)			63
Change in allowance for doubtful accounts			(76	)			(46	)
Amortization of deferred debt issue costs			361				378
Amortization of operating ROU asset			2,576				2,849
Gain on investment in joint venture			(376	)			(338	)
Deferred income taxes			2,997				-
Changes in assets and liabilities:
Accounts receivable			(1,172	)			(4,769	)
Other assets			(2,292	)			(752	)
Inventories			(2,081	)			496
Prepaid expenses			(2,170	)			(920	)
Accounts payable			(2,187	)			(770	)
Accrued liabilities, other current liabilities and other noncurrent liabilities			(19	)			(1,586	)
Net cash provided by operating activities			13,009				5,469
Cash flows from investing activities:
Purchases of property, plant and equipment			(4,499	)			(3,251	)
Proceeds from the sale of property, plant and equipment			56				201
Distributions from joint venture			239				-
Equity repayment/(investment) in joint venture			226				(414	)
Net cash used in investing activities			(3,978	)			(3,464	)
Cash flows from financing activities:
Repayments on term loan			(7,233	)			(5,745	)
Repayment of finance leases			(58	)			(16	)
Borrowings on revolving line of credit			19,459				47,839
Repayments on revolving line of credit			(19,459	)			(44,339	)
Net cash used in financing activities			(7,291	)			(2,261	)
Effect of exchange rate changes on cash, cash equivalents			20				8
Net increase (decrease) in cash and cash equivalents			1,760				(248	)
Cash and cash equivalents, beginning of period			1,516				488
Cash and cash equivalents, end of period		$	3,276			$	240
Supplemental disclosure - Cash paid for interest		$	5,711				7,153
Supplemental disclosure - Cash paid for income taxes		$	2,257				2,642
Supplemental disclosure - Capital asset purchases in accounts payable		$	42				-

The accompanying notes are an integral part of these consolidated financial statements

6

SRR Holdings, Inc. and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2025 and 2024

'000's except share and per share data

(UNAUDITED)

NOTE 1 - NATURE OF BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES

Organization and Nature of Business

SRR Holdings, Inc. and Subsidiaries (collectively, the “Company”) is a Delaware corporation. Through their wholly owned primary operating subsidiaries, the Company’s operations consist of the following:

• Royston, LLC (“Royston”) -  designing, manufacturing, selling, and installing convenience and grocery store equipment, including check stands, sales and customer service centers, preparation counters, coffee/beverage islands, beverage tower systems, heated food merchandising systems, counters and countertops, shelving and kiosks; and laboratory furniture and fume hoods sold under the Hamilton brand name; and

• SignResource, LLC (“SignResource”) - designing, manufacturing, selling, installing and servicing outdoor signage, in-store sign solutions and related design elements; and

• Southern CaseArts (“SCA”) - designing, manufacturing and selling refrigerated and heated display cases, refrigerated island merchandisers, self-service cases, and combination cases.

A summary of the Company’s significant accounting policies follows.

Basis of Presentation

The interim consolidated financial statements are unaudited and are prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information. In the opinion of management, the interim financial statements include all normal adjustments and disclosures necessary to present fairly the Company’s financial position as of September 30, 2025 and 2024, the results of its operations and comprehensive income, shareholders’ equity and cash flows for the nine-month periods ended September 30, 2025, and 2024. These statements should be read in conjunction with the 2024 consolidated financial statements and footnotes.

Principles of Consolidation

The accompanying consolidated financial statements include the accounts of Royston, SignResource and SCA. All intercompany transactions and balances have been eliminated in consolidation.

Revenue Recognition

The Company recognizes revenue using the five-step model prescribed by ASC 606, which requires us to: (1) identify the contract with the customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to the performance obligations in the contract; and (5) recognize revenue when, or as, an entity satisfies a performance obligation.

A contract with a customer is identified when it has approval and commitment from both parties, the rights of the parties are identified, payment terms are identified, the contract has commercial substance and collectability of consideration is probable.

The Company accepts returns or claims for goods having quality defects or for other reasons such as disagreements or improper delivery. When revenue is recorded, estimates of returns are made and recorded as a reduction of revenue. 

Recognition of Material Performance Obligations

Product sales - This performance obligation is satisfied at a point in time when the control of the product passes to the customer. This is generally at a point in time upon shipment for product sales.

Project management services - Since the customer simultaneously receives and consumes the benefits throughout the process, this performance obligation is satisfied over the period of time the service is performed for the customer.  There have been no significant contract assets or liabilities recorded as of September 30, 2025 and 2024.

7

SRR Holdings, Inc. and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2025 and 2024

'000's except share and per share data

(UNAUDITED)

Disaggregation of revenues - Timing of revenue recognition for the 9 months ended September 30, 2025 and 2024 is shown below:

		2025				2024
Net sales transferred at a point in time		$	174,871			$	169,990
Net sales transferred over time			27,515				31,898
		$	202,386			$	201,888

Fair Value of Financial Instruments

Because of their short maturities, the fair value of cash and cash equivalents, accounts receivable, accounts payable and other accrued liabilities are not materially different than their carrying amounts, as reported. The fair value of debt instruments is estimated to approximate carrying amounts since interest rates on these obligations adjust frequently and approximate the rates at which the Company could obtain similar financing at September 30, 2025 and 2024.

Cash and Cash Equivalents

For purposes of reporting the statements of cash flows, the Company considers all cash accounts and all highly liquid financial instruments purchased with an original maturity of three months or less to be cash and cash equivalents. Cash deposits are held in federally insured institutions.  Uninsured domestic held deposits as of September 30, 2025 and 2024 were $3,055 and $0, respectively, and China uninsured deposits were $93 and $171, respectively.

Management performs periodic evaluations of the relative credit standing of the financial institution and believes the risk of loss to be remote.

Accounts Receivable and Allowance for Doubtful Accounts

Accounts receivable are initially recognized at their sales price. Accounts receivable are considered past due or delinquent when payment is not received within the credit terms extended to the customer. An allowance for estimated credit losses on accounts receivable is provided based on analysis of historical losses and recoveries. Receivables are written off when deemed to be uncollectible. Accounts receivable are net of an allowance for doubtful accounts of $219 and $322 as of September 30, 2025 and 2024, respectively. The Company does not charge interest or late fees on past due accounts and generally does not require collateral.

While the relative significance of any particular customer varies from period to period, the loss of, or significant curtailments of, purchases of goods and services by one or more of the Company’s significant customers at any time would adversely affect revenues and cash flows. The following table summarizes customers generating significant revenues for the Company for the 9 months ended September 30, 2025 and 2024, as well as those representing a significant portion of the accounts receivable balances as of September 30, 2025 and 2024:

		2025				2025				2024				2024
Customer		Revenues				Accounts Receivable				Revenues				Accounts Receivable
Customer A			20	%			15	%			30	%			36	%
Customer B			12	%			13	%			11	%			12	%
Customer C			12	%			23	%			10	%			14	%

* This customer did not have revenues in excess of 10% of the Company's total revenues in 2025.

** This customer did not have accounts receivable in excess of 10% of the Company's total accounts receivable balance.

8

SRR Holdings, Inc. and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2025 and 2024

'000's except share and per share data

(UNAUDITED)

Inventories

Inventories are valued at the lower of cost or net realizable value. Cost is determined on the basis of weighted average and first-in, first-out (FIFO) methods. The Company assesses inventory on hand periodically for slow moving, obsolete, or damaged product. The carrying value of the slow moving, obsolete, and damaged products are reduced to their estimated net realizable value.

Deferred Debt Issue Costs

Deferred debt issue costs are being amortized over the term of the underlying debt agreements using the effective interest method. Amortization expense of $481 and $471 for the 9 months ended September 30, 2025 and 2024, respectively, is recognized in interest expense. As of September 30, 2025 and 2024, gross deferred debt issue costs were $3,619 and $3,619, respectively, and accumulated amortization was $3,129 and $2,696, respectively.

Estimated amortization expense for deferred debt issue costs for the next three years is as follows:

		Amount
2025		$	120
2026			318
2027			52
		$	490

Goodwill

Goodwill represents the excess of the cost of an acquired entity over the net amount assigned to assets acquired, including other identifiable intangible assets, and liabilities assumed in a business combination. Goodwill is not amortized however it is subject to review for impairment. There was no impairment recognized for the 9 months ended September 30, 2025 and 2024. 

Long-Lived Assets

The Company reviews long-lived assets for impairment when events or changes in business conditions indicate that their full carrying value may not be recoverable. Intangible assets with definite lives, comprised primarily of trademarks, proprietary manufacturing processes, and customer relationships, are amortized over their estimated useful lives and evaluated for impairment consistent with other long-lived assets. Recoverability of long-lived assets is assessed by comparison of the carrying amount of the asset to the estimated future net cash flows expected to be generated by the asset. If estimated future net cash flows are less than the carrying amount of the asset, the asset is impaired, and an expense is recorded in an amount required to reduce the carrying amount of the asset to its fair value. There was no impairment recognized for the 9 months ended September 30, 2025 and 2024.

Property, Plant and Equipment

Property, plant and equipment are stated at cost. Major additions and improvements are capitalized, while maintenance and repairs that do not improve the utility or extend the lives of the respective assets are expensed. The carrying amounts of assets that are sold or retired, and the related accumulated depreciation, are removed from the accounts in the year of disposal, and any resulting gain or loss is reflected in the statements of operations and comprehensive loss in other expenses.

Leases 

Under ASC Topic 842, a lease is a contract, or part of a contract, that conveys the right to control the use of identified property, plant or equipment for a perioed of time in exchange for consideration. The Company primarily leases manufacturing plants, typically with office space, and equipment under lease agreements. The Company determines if an arrangement is a lease at inception. The Company elected an accounting policy by class of underlying asset to combine lease and non-lease components. 

9

SRR Holdings, Inc. and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2025 and 2024

'000's except share and per share data

(UNAUDITED)

For leases with terms greater than 12 months, the Company records the related asset and obligation at the present value of lease payments over the term. Leases expire at various dates from 2025 through 2035, with varying renewal and termination options. The length of lease terms include options to extend or terminate the lease when it is reasonably certain such option will be exercised. The Company has certain leases that contain lease and non-lease components and has elected the practical expedient to account for these components as a single lease component.   The Company also made an accounting policy election to forego capitalization of leases with an initial term of 12 months or less.  

Right-of-use (“ROU”) assets and lease liabilities are recognized based on the present value of lease payments over the lease term as of the commencement date. Because most of the Company’s leases do not provide an explicit or implicit rate of return, the incremental borrowing rate used is based on the information available at the commencement date in determining the present value of lease payments on an individual lease basis. The incremental borrowing rate for a lease is the rate of interest the Company would have to pay on a collateralized basis to borrow an amount equal to the lease payments for the asset under similar terms.  

The Company monitors events or changes in circumstances that change the timing or amount of future lease payments which results in the remeasurement of a lease liability, with a corresponding adjustment to the ROU asset. ROU assets for operating and financing leases are periodically reviewed for impairment losses under ASC 360-10, Property, Plant, and Equipment, to determine whether a ROU asset is impaired, and if so, the amount of the impairment loss to recognize.   There was no impairment recognized for the 9 months ended September 30, 2025 and 2024.

Income Taxes

The Company follows the asset and liability method of accounting for income taxes. Under this method, current income taxes are recognized for the estimated income taxes payable for the current period. Deferred income tax assets and liabilities are determined based on differences between financial reporting and tax bases of assets and liabilities and on unutilized tax losses carried forward and measured using enacted tax rates and laws that will be in effect when the differences are expected to reverse. A valuation allowance is recognized to the extent that the recoverability of deferred income tax assets is not considered more likely than not.

Management believes that there is appropriate support for the income tax positions taken and to be taken on income tax returns and that income tax receivables and accruals for tax liabilities are adequate for all open years based on an assessment of many factors, including past experience and interpretations of tax laws applied to the facts of each matter. Accordingly, a liability has not been recognized as a result of applying the applicable authoritative standards on accounting for uncertainty in income taxes as of September 30, 2025 and 2024.

Tax years 2021 through 2024 remain open to examination by the tax authorities under the statute of limitations.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Foreign Currency Translation

The Company’s subsidiary in China prepares their financial statements using the Chinese Yuan as the functional currency. Accordingly, the Company’s consolidated foreign currency translation gains and losses are included in accumulated other comprehensive loss. The consolidated translation profit included in equity amounted to $20 and $8 for the 9 months ended  September 30, 2025 and 2024, respectively. Deferred income taxes are not provided on currency translation adjustments as foreign earnings are considered to be permanently reinvested.

10

SRR Holdings, Inc. and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2025 and 2024

'000's except share and per share data

(UNAUDITED)

Investment in Joint Venture

The Company is part of a joint venture agreement with Tam-Mex, S.A. de C.V., a manufacturer located in Mexico City, Mexico, to market and distribute products in Mexico. The respective partners each own 50% of the corporate capital of the joint venture company, Royston Tammex S DE RL DE CV. This is accounted for under equity method of accounting. The initial capital contribution to the joint venture by the Company was $31, which includes an initial capital contribution of $10, plus an additional $21 for 50% of the cost of start-up tooling. During 2024, the Company made an additional capital contribution of $414 of which $227 was repaid during 2025. The Company has recognized $376 and $338 in income from the joint venture for the 9 months ended September 30, 2025 and 2024, respectively.

NOTE 2 - INVENTORIES

The components of inventories as of September 30, 2025 and 2024 are as follows:

		2025				2024
Raw materials		$	18,861			$	18,285
Work-in-process			4,683				5,622
Finished goods			10,691				6,982
			34,235				30,889
Less: Reserve for slow-moving, obsolete and damaged inventory			(3,671	)			(2,788	)
		$	30,564			$	28,101

NOTE 3 - PROPERTY, PLANT AND EQUIPMENT, NET

Depreciation is computed for financial reporting purposes using the straight-line method over the estimated useful lives of the assets. Leasehold improvements are depreciated using the straight-line method over the remaining life of the applicable lease when the life of the lease is less than the related useful life of the asset. 

Property, plant and equipment as of September 30, 2025 and 2024, are as follows:

		2025				2024				Useful Lives (in years)
Leasehold improvements		$	4,787			$	4,424			2	-	15
Machinery and equipment			30,016				30,303			2	-	19
Trucks and autos			392				370			3	-	5
Computer equipment and software			1,670				1,326			2	-	5
Furniture, fixtures and other			586				671			2	-	10
Construction in progress			3,881				2,736
			41,332				39,830
Less - Accumulated depreciation			(20,615	)			(20,602	)
		$	20,717			$	19,228

Depreciation expense was $2,112 and $2,230 for the 9 months ended September 30, 2025 and 2024, respectively.

11

SRR Holdings, Inc. and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2025 and 2024

'000's except share and per share data

(UNAUDITED)

NOTE 4 - INTANGIBLE ASSETS

The components of intangible assets as of September 30, 2025 and 2024 are as follows:

		2025				2024				Useful Lives (in years)
Trade names		$	43,510			$	43,510			15
Trade names			1,440				1,440			Indefinite
Proprietary manufacturing process			7,680				7,680			3	-	12
Customer relationships			67,480				67,480			3	-	15
			120,110				120,110
Less - Accumulated amortization - Trade names			(21,319	)			(18,418	)
Less - Accumulated amortization - Proprietary manufacturing process			(4,993	)			(4,385	)
Less - Accumulated amortization - Customer relationships			(33,079	)			(28,551	)
		$	60,719			$	68,756

Amortization expense was $6,024 and $6,071 for the 9 months ended September 30, 2025 and 2024.

Estimated amortization expense, for the next five years and thereafter, as of September 30, 2025, is as follows:

		Amount
2025		$	1,974
2026			7,974
2027			7,974
2028			7,974
2029			7,974
2030			7,467
Thereafter			17,942
		$	59,279

NOTE 5 - GOODWILL

The carrying values of goodwill are reviewed at least annually for possible impairment or whenever events or changes in circumstances indicate that goodwill may be impaired. The Company first assesses qualitative factors in order to determine if goodwill is impaired. If, through qualitative assessment, it is determined that it is more likely than not that the goodwill is not impaired, no further testing is required. If it is determined that it is more likely than not that the goodwill is impaired, or if the Company elects not to first assess qualitative factors, the Company’s impairment testing continues with the estimation of the fair value of the reporting unit using a combination of a market approach and an income (discounted cash flow) approach, at the reporting-unit level. The estimation of the fair value of the reporting unit requires significant management judgment with respect to revenue and expense growth rates, changes in working capital, and the selection and use of an appropriate discount rate. The estimates of the fair value of reporting units are based on the best information available as of the date of the assessment. The use of different assumptions could increase or decrease estimated future discounted operating cash flows and could increase or decrease an impairment charge. Company management uses its judgment in assessing whether assets may have become impaired between annual impairment tests. Indicators such as adverse business conditions, economic factors, and technological or competitive activities may signal that an asset has become impaired.

The Company identified its reporting units in conjunction with its annual goodwill impairment testing. The Company has a total of two reporting units that contain goodwill. The Company relies upon a number of factors, judgments, and estimates when conducting its impairment testing, including, but not limited to, the Company’s operating results, forecasts, anticipated future cash flows, and marketplace data. There are inherent uncertainties related to these factors and the judgments applied in the analysis of goodwill impairment.

12

SRR Holdings, Inc. and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2025 and 2024

'000's except share and per share data

(UNAUDITED)

The following presents information about the Company's goodwill on the dates or for the periods indicated:

		SignResource, LLC				Royston, LLC				Southern CaseArts				Total
Balance as at December 31, 2023
Goodwill		$	26,049			$	11,183			$	502			$	37,734
Accumulated impairment losses		$	(26,049	)		$	-			$	-			$	(26,049	)
Balance as at September 30, 2024		$	-			$	11,183			$	502			$	11,685
Balance as at December 31, 2024
Goodwill		$	26,049			$	11,183			$	502			$	37,734
Accumulated impairment losses		$	(26,049	)		$	-			$	-			$	(26,049	)
Balance as at September 30, 2025		$	-			$	11,183			$	502			$	11,685

NOTE 6 - LONG-TERM DEBT

Credit Agreement

On March 9, 2018, the Company entered into a credit agreement (the “Credit Agreement”) with a third-party lending institution, which included a Term Loan and a Revolving Credit Facility.  The Credit Agreement was amended on July 28, 2022 and again on July 27, 2023 as discussed in more detail below.   The Credit Agreement is collateralized by a security interest in substantially all of the present and future assets of the Company.

Term Loan

The Company's initial Term Loan of $50,000 with maturity date of March 9, 2024, was revised on July 27, 2018 with an increase to $60,000 and the maturity date extended to July 27, 2023.  On July 27, 2023, the Company refinanced its senior debt, extending the maturity date to July 27, 2026. The revised Term Loan’s principal amount was $60,000, repayable in quarterly installments, with a balloon payment of the remaining principal due at maturity.

The Company’s senior loans mature on July 27, 2026.  Based on the Company’s available cash balances and projected cash flows from operations, the Company does not expect to have sufficient liquidity to make the required balloon payment on the senior debt which comes due in July 2026.  However, based on the Company’s history of successfully refinancing its debt obligations as well as its strong financial position and operating performance, the Company expects to refinance the senior debt in the normal course of business on or before July 2026.  It is expected the subordinated debt which comes due in July 2027 will also be extended consistent with the senior debt refinancing.  The largest lenders of the senior debt syndicate have indicated interest in renewing the credit facility and the Company does not expect significant changes in the terms or interest rates compared to the current debt facilities.  

13

SRR Holdings, Inc. and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2025 and 2024

'000's except share and per share data

(UNAUDITED)

The loan bears interest at a rate equal to the Base Rate or Adjusted Term Secured Overnight Financing Rate (SOFR) for such interest period, as stipulated in the executed Credit Agreement and selected by the Company, plus the applicable margin. SOFR is a reference rate that is used by parties in commercial contracts that is outside their direct control, established as an alternative to LIBOR.  The applicable margin is based on the Company’s senior leverage ratio as defined by the Credit Agreement. The interest rate for the Term Loan as of September 30, 2025 and 2024 was 7.32% and 7.94%, respectively. Interest on the Term Loan determined using the SOFR Rate is paid monthly or quarterly dependent on the rate periodically selected by the Company.

Revolving Credit Facility

The Credit Agreement includes a revolving credit facility (“Revolver”), initially set at a borrowing limit of $15,000. This limit was raised to $25,000 following an amendment to the agreement on July 27, 2018 and to $30,000 following another amendment to the agreement on July 27, 2023. There were $0 and $3,500 outstanding borrowings as of September 30, 2025 and 2024, respectively. Total available for additional borrowings under the Revolver was $28,655 and $25,230 as of September 30, 2025 and 2024, respectively. The maturity date for the Revolver is July 27, 2026.

All Base Rate Advances of the Revolving Credit and Swing Line shall bear interest at a per annum interest rate equal to the Base Rate plus the Applicable Margin. All Term SOFR Advances of the Revolving Credit bear interest for each Interest Period at a per annum interest rate equal to Adjusted Term SOFR for such Interest Period plus the Applicable Margin and all Quoted Rate Advances of the Swing Line shall bear interest at a per annum interest rate equal to the Quoted Rate plus the Applicable Margin, if any. Interest accruing at the Base Rate shall be computed on the basis of a 360-day year and assessed for the actual number of days elapsed, and in such computation effect shall be given to any change in the interest rate resulting from a change in the Base Rate on the date of such change in the Base Rate. Interest on the Revolver is payable monthly.

Subordinated Note

The Company obtained a Subordinated Note worth $13,000 on March 9, 2018, with an initial maturity date of March 9, 2025. This note was modified on July 27, 2018, increasing the note’s value to $30,000 and extending the maturity date to July 27, 2024. A second amendment to the Subordinated Note was made on July 27, 2023, extending the maturity date further to July 27, 2027, without any other significant alterations to the note. The note accrues interest at an annual rate of 11% on the outstanding principal, payable quarterly in arrears.  The balance of the Subordinated Note, including paid-in-kind interest, was $33,439 on September 30, 2025 and 2024.

The Company was in compliance with the debt covenants (as amended) for all reporting periods.

Derivatives and Hedging Activities

The Company is party to an interest rate swap agreement effective October 2024 to economically hedge the interest rate risk associated with the variable interest rates on a portion of its long-term debt.  The notional amount is $16,000 and $18,000 at September 30, 2025 and 2024, respectively, and is reduced quarterly through July 2026 to $13,500.  The fair value of the swap was not material at September 30, 2025 and 2024.

Letters of credit

As of September 30, 2025 and 2024, respectively, the outstanding letters of credit issued in terms of the credit agreement were $1,345 and $1,270. The beneficiaries are Hartford Fire Insurance Company, increasing from $830 to $905 and Great American Insurance Company $440.

The balances as of September 30, 2025 and 2024 were as follows:

		2025				2024
Term loan		$	44,057			$	52,756
Subordinated note			33,439				33,439
Revolving line of credit			-				3,500
Less - unamortized deferred financing costs related to the term loan			(490	)			(923	)
			77,006				88,772
Less - current portion			(43,730	)			(5,862	)
		$	33,276			$	82,910

14

SRR Holdings, Inc. and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2025 and 2024

'000's except share and per share data

(UNAUDITED)

Scheduled maturities of the term loan, subordinated note, and revolving facility as of September 30, 2025, are as follows:

		Amount
2025		$	1,799
2026			42,258
2027			33,439
		$	77,496

NOTE 7 - LEASES

The following table presents the carrying value of leases and the classification within the consolidated balance sheet (remaining lease terms are between 4 months and 9.8 years):

	Classification		2025				2024
Operating lease liabilities	Current		$	3,889			$	3,468
Operating lease liabilities	Non-current		$	20,680			$	24,486
ROU asset, operating leases	Non-current		$	22,990			$	26,730
Finance lease liabilities	Current		$	47			$	35
Finance lease liabilities	Non-current		$	60			$	71
ROU asset, finance leases	Non-current		$	132			$	104

The following summarizes the lease costs included within the consolidated statements of operations and comprehensive income.  Substantially all of the lease expenses are recorded in cost of goods sold, with an insignificant amount recorded in selling, general and administrative expenses, for the 9 months ended September 30, 2025 and 2024, respectively.  

		2025				2024
Finance leases		$	40			$	41
Operating leases		$	4,234			$	4,075
Short-term leases		$	422			$	350

Future minimum payments under noncancelable operating leases, due in each of the next 5 years and thereafter as of September 30, 2025, are as follows:

Year Ending:
2025		$	1,372
2026			5,508
2027			5,502
2028			4,292
2029			2,464
Thereafter			12,165
Total minimum lease payments			31,303
Less: Imputed interest		$	(6,734	)
		$	24,569

15

SRR Holdings, Inc. and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2025 and 2024

'000's except share and per share data

(UNAUDITED)

Future minimum payments under noncancelable finance leases, due in each of the next 5 years and thereafter as of September 30, 2025, are as follows:

Year Ending:
2025		$	15
2026			56
2027			44
2028			4
Total minimum lease payments			119
Less: Imputed interest		$	(12	)
		$	107

		2025				2024
The following table presents additional information about lease obligations:
Weighted-average Operating lease term (years)			7.13				7.79
Weighted-average Operating lease discount rate			7.39	%			7.51	%
Weighted-average Finance lease term (years)			2.52				3.07
Weighted-average Finance Lease discount rate			7.69	%			8.05	%

		2025				2024
The following table presents supplemental cash flow information:
Cash paid for amounts included in measurement of lease liabilities
Operating cash flows for operating leases		$	4,085			$	4,103
Cash flows for finance leases		$	53			$	28
Right-of-use assets obtained in exchange for lease obligations (non-cash)
Operating leases		$	61			$	6,916
Finance leases		$	66			$	82

NOTE 8 - EMPLOYEE BENEFIT PLANS

The Company has 401(k) retirement savings plans covering substantially all domestic full-time employees.  These Plans were merged into one plan on August 1, 2024. The Company makes contributions to these plans based on employee contributions. Related expenses were $908 and  $736 for the 9 months ended September 30, 2025 and 2024, respectively.

NOTE 9 - LITIGATION

The Company is involved in various legal proceedings encountered in the normal course of business. In the opinion of management, the resolution of these matters will not have a material adverse effect on the Company’s financial position.

NOTE 10 - INSURANCE RESERVES

The Company has insurance policies for medical and workers’ compensation benefits that contain significant deductibles. The cost of general medical and workers’ compensation claims, up to the deductibles, is accrued annually based on actual claims reported plus estimated amounts for claims not reported. These estimates are based on historical information, along with certain assumptions about future events, and are subject to change as additional information becomes available. As of September 30, 2025 and 2024, the Company accrued $1,922 and $2,087 respectively, for general medical and workers’ compensation claims within accrued liabilities in the consolidated balance sheets.

16

SRR Holdings, Inc. and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2025 and 2024

'000's except share and per share data

(UNAUDITED)

NOTE 11 - INCOME TAXES

The Company's effective income tax rate is based on expected income, statutory rates, and tax planning opportunities available in various jurisdictions in which it operates.  For interim financial reporting, the Company estimates the annual income tax rate based on projected taxable income for the full year and records a quarterly income tax provision or benefit in accordance with the anticipated annual rate.  The Company refines the estimates of the year's taxable income as new information becomes available, including actual year-to-date financial results.  This continual estimation process often results in a change to the expected effective income tax rate for the year.  When this occurs, the Company adjusts the income tax provision during the quarter in which the change in estimate occurs so that the year-to-date provision reflects the expected income tax rate.  Significant judgment is required in determining the effective tax rate and in evaluating tax positions.

Income tax expense for the nine months ended September 30, 2025 was calculated using our estimated annual effective tax rate of 24.3%. This estimated rate differs from our (64.1)% effective tax rate for the year ended December 31, 2024, primarily because the 2024 rate reflects the reversal of a deferred tax valuation allowance, which significantly reduced tax expense in that period. Since that reversal was a discrete, non recurring item, it is not reflected in our estimated annual effective tax rate for the current year.

NOTE 12 - STOCK OPTION PLAN

The Company has a stock-based incentive plan for directors and key employees, which is administered by the Company’s Board of Directors. Stock options vest upon a sale of the Company or upon an initial public offering of the Company in which the holders of shares of common stock of the Company achieve a minimum internal rate of return as determined by the Board of Directors and set forth in the stock option agreement of each holder. As of September 30, 2025 and 2024, no options have vested, and no related compensation expense has been recorded.

Stock options terminate 10 years after the effective date of grant. Outstanding stock options as of September 30, 2025 are as follows:

		Number of Options				Weighted- Average Exercise Price				Remaining Contractual Term
Balance at December 31, 2024			44,526
Options granted			-				100				N/A
Options forfeited/reduced			-				100
Balance at September 30, 2025			44,526
Vested and unvested expected to vest at September 30, 2025			-
Exercisable at September 30, 2025			-

NOTE 13 - RELATED-PARTY TRANSACTIONS

As of September 30, 2025 and 2024, the Company was party to a management agreement with its majority shareholder. Under the agreement, the majority shareholder performs certain services for the Company including, but not limited to, consultation on corporate strategy, budgeting of future corporate investments, acquisition and divestiture strategies, and debt and equity financings. Management fees expensed and paid during the 9 months ended September 30, 2025 and 2024 were $563, respectively.  Management fees payable were $613 at September 30, 2025 and 2024 respectively. The Company also receives management fees for similar services provided to a joint venture, Royston Tammex S DE RL DE CV. Management fees received during the 9 months ended September 30, 2025 and 2024 were $255 and $641, respectively.

17

SRR Holdings, Inc. and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2025 and 2024

'000's except share and per share data

(UNAUDITED)

NOTE 14 - SUBSEQUENT EVENTS

The Company has evaluated subsequent events through February 20, 2026, the date these consolidated financial statements were available to be issued. All subsequent events requiring recognition or disclosure have been incorporated into these consolidated financial statements.

18

Exhibit 99.9

UNAUDITED PROFORMA FINANCIAL INFORMATION

On February 20, 2026, LSI Industries Inc. (“LSI” or the “Company”) has entered into a definitive agreement to acquire privately held Royston Group (“Royston”), a leader in identity and equipment solutions for retail environments, from Industrial Opportunity Partners (“IOP”) for a purchase price of $320 million in cash and $5 million in the issuance of shares of the Company’s common stock valued as of the closing price of the Company’s common stock on February 19, 2026. The transaction is subject to Hart-Scott-Rodino clearance and is expected to close in the third quarter of LSI’s 2026 fiscal year. The following unaudited proforma financial information has been prepared in accordance with Article 11 of Regulation S-X and gives effect to the acquisition by LSI using the acquisition method of accounting with the assumptions and adjustments described in the accompanying notes to the unaudited pro forma financial information.

The Unaudited Pro Forma Condensed Combined Balance Sheet is presented as if the transaction had occurred on December 31, 2025, and the Unaudited Pro Forma Condensed Combined Statement of Operations are presented to give effect to the merger as if it occurred on July 1, 2024. The proforma financial information should be read in conjunction with the following:

● LSI’s historical consolidated financial statements that were included in its Quarterly Report on Form 10-Q for the period ended December 31, 2025, and Annual Report on Form 10-K for the year ended June 30, 2025.

● Royston’s historical financial statements are included in this Current Report on Form 8-K. The historical statements of Royston have been adjusted to conform to the Company’s financial statement presentation.

The unaudited pro forma statements of operations are presented for illustrative purposes only and is not necessarily indicative of the results of operations that would have actually been reported had the acquisition occurred on July 1, 2024, nor is it necessarily indicative of the future results of the operations. The unaudited proforma condensed combined statements of operations and proforma condensed combined balance sheet include adjustments to reflect the allocation of the purchase price to acquired assets and assumed liabilities of Royston and related financing for this transactions.

The unaudited proforma condensed combined financial information is based on the assumptions and proforma adjustments that are described in the accompanying notes. The proforma adjustments are preliminary, subject to further revision as additional information becomes available and additional analyses are performed. Adjustments have been made solely for the purpose of providing unaudited pro forma condensed combined financial information. Differences between these preliminary estimates and the final accounting, expected to be completed after the closing, may occur and these differences could have a material impact on the accompanying unaudited proforma condensed combined financial information.

The unaudited pro forma condensed combined financial information does not give effect to the potential impact of current financial conditions, regulatory matters, operating efficiencies or other savings or expenses that may be associated with the integration of the two companies. The unaudited pro forma condensed combined financial information is not necessarily indicative of the financial position or results of operations in the future periods or the result that actually would have been realized had LSI and Royston been a combined organization during the specified periods. The actual results reported in periods following the Merger may differ significantly from those reflected in the unaudited condensed combined pro forma financial information presented herein for a number of reasons, including, but not limited to, differences in the assumptions used to prepare this unaudited pro forma condensed combined financial information.

LSI Industries Inc.

Unaudited Proforma Condensed Balance Sheet

December 31, 2025

(Unaudited)

		Historical				Historical				Pro Forma					Pro Forma
		LSI				Royston				Adjustments					Total
(in thousands, except shares)
ASSETS
Current assets
Cash and cash equivalents		$	6,407			$	3,276								$	9,683
Accounts receivable, net			90,618				35,696									126,314
Inventories			82,023				30,564									112,587
Refundable income tax			998				4,587									5,585
Other current assets			7,213				2,494									9,707
Total current assets			187,259				76,617				-					263,876
Property, Plant and Equipment, at cost
Land			4,029													4,029
Buildings			24,928				4,787				(538	)	B			29,177
Machinery and equipment			78,769				32,664				(12,294	)	B			99,139
Construction in progress			1,913				3,881									5,794
			109,639				41,332				(12,832	)				138,139
Less accumulated depreciation			(79,267	)			(20,615	)			20,615		B			(79,267	)
Net property, plant and equipment			30,372				20,717				7,783					58,872
Goodwill			64,089				11,685				111,739		D			187,513
Other intangible assets, net			75,106				60,719				66,281		C			202,106
Operating lease right-of-use assets			30,080				23,122									53,202
Deferred tax assets			5,561				5,260									10,821
Other long-term assets, net			3,839				1,697									5,536
Total assets		$	396,306			$	199,817			$	185,803				$	781,926
LIABILITIES & SHAREHOLDERS' EQUITY
Current liabilities
Current portion of debt		$	-			$	43,730			$	(43,730	)	E			-
Accounts payable			43,334				12,072									55,406
Accrued expenses and other total current liabilities			43,841				20,809				7,000		G			71,650
Total current liabilities			87,175				76,611				(36,730	)				127,056
Long-term debt			27,939				33,276				206,724		A, E			267,939
Operating lease liabilities			23,247				20,740									43,987
Other Long-Term Liabilities			3,310													3,310
Deferred tax liabilities			3,197													3,197
Commitments and contingencies			3,341													3,341
Shareholders' Equity
Common shares			170,489				57,681				27,319		A,F			255,489
Treasury shares, without par value			(10,845	)												(10,845	)
Deferred compensation plan			10,845													10,845
Retained earnings			76,733				11,557				(11,557	)	F, G			76,733
Accumulated other comprehensive income			875				(48	)			48		F			875
Total shareholders' equity			248,097				69,190				15,809					333,096
Total liabilities & shareholders' equity		$	396,306			$	199,817			$	185,803				$	781,926

LSI Industries Inc.

Unaudited Proforma Condensed Combined Statement of Operations

Six Months Ended December 31, 2025

(Unaudited)

(amounts in thousands except per share data

		Historical				Historical				Pro Forma					Pro Forma
		LSI				Royston				Adjustments					Total
Sales		$	304,251			$	135,842								$	440,093
Cost of goods sold			226,540				101,842				292		H			328,674
Gross profit (loss)			77,711				34,000				(292	)				111,419
Selling and administrative costs			57,874				21,785				(509	)	I, G			79,150
Operating income			19,837				12,215				217					32,269
Interest expense			1,320				3,907				226		K			5,453
Other (income)/expense			427				(430	)			(378	)	J			(381	)
Income (loss) before taxes			18,090				8,738				369					27,197
Income tax expense			4,478				2,123				89		L			6,690
Net income (loss)		$	13,612			$	6,615			$	280				$	20,507
Earnings per share
Basic		$	0.44												$	0.57
Diluted		$	0.43												$	0.56
Weighted average common shares outstanding
Basic			30,803								4,989		A			35,792
Diluted			31,685								4,989		A			36,674

LSI Industries Inc.

Unaudited Proforma Condensed Combined Statement of Operations

Twelve Months Ended June 30, 2025

(Unaudited)

(amounts in thousands except per share data

		Historical				Historical				Pro Forma					Pro Forma
		LSI				Royston				Adjustments					Total
Sales		$	573,377			$	269,476								$	842,853
Cost of goods sold			431,597				205,958				583		H			638,138
Gross profit (loss)			141,780				63,518				(583	)				204,715
Selling and administrative costs			106,011				43,902				5,982		I, G			155,895
Operating income (loss)			35,769				19,616				(6,565	)				48,820
Interest expense			3,129				9,057				3,230		K			15,416
Other (income)/expense			(398	)			427				(756	)	J			(727	)
Income (loss) before taxes			33,038				10,132				(9,039	)				34,131
Income tax expense (benefit)			8,655				(4,658	)			(1,898	)	L			2,099
Net income (loss)		$	24,383			$	14,790			$	(7,141	)			$	32,032
Earnings per share
Basic		$	0.82												$	0.92
Diluted		$	0.79												$	0.89
Weighted average common shares outstanding
Basic			29,903								4,989		A			34,892
Diluted			30,832								4,989		A			35,821

NOTE 1 – RECONILIATION OF SSR HOLDING, INC. STATEMENT OF OPERATIONS

To reconcile the consolidated statements of operations for SSR Holdings Inc. (“Royston”) filed in the Form 8-K report for the year ended December 31, 2024, and the nine months ended September 30, 2025, the following tables provide the quarterly financial information supporting the combined statement operations used in the proforma.

LSI Industries Inc.
Unaudited Proforma Condensed Combined Statement of Operations
Royston Twelve Months Ended March 31, 2025		A				B				C				A+B-C
(Unaudited)		12 Mos 12.31.24				3 Mos 3.31.25				3 Mos 3.31.24				12 Mos 3.31.25
(amounts in thousands except per share data		Historical				Historical				Historical				Historical
		Royston				Royston				Royston				Royston
Sales		$	271,328			$	66,544			$	(68,396	)		$	269,476
Cost of Goods Sold			210,835				49,407				(54,284	)			205,958
Gross Profit			60,493				17,137				(14,112	)			63,518
Selling and Administrative Costs			42,818				11,418				(10,334	)			43,902
Operating Income			17,675				5,719				(3,778	)			19,616
Interest Expense			9,502				2,093				(2,538	)			9,057
Other (Income)/Expense			363				27				37				427
Income Before Taxes			7,810				3,599				(1,277	)			10,132
Income Tax Expense			(5,010	)			875				(523	)			(4,658	)
Net Income		$	12,820			$	2,724			$	(754	)		$	14,790

LSI Industries Inc.
Unaudited Proforma Condensed Combined Statement of Operations
Royston Six Months Ended September 2025		A				B				A-B
(Unaudited)		9 Mos 9.30.25				3 Mos 3.31.25				6 Mos 9.30.25
(amounts in thousands except per share data		Historical				Historical				Historical
		Royston				Royston				Royston
Sales		$	202,386			$	(66,544	)		$	135,842
Cost of Goods Sold			151,249				(49,407	)			101,842
Gross Profit			51,137				(17,137	)			34,000
Selling and Administrative Costs			33,203				(11,418	)			21,785
Operating Income			17,934				(5,719	)			12,215
Interest Expense			6,000				(2,093	)			3,907
Other (Income)/Expense			(403	)			(27	)			(430	)
Income Before Taxes			12,337				(3,599	)			8,738
Income Tax Expense			2,998				(875	)			2,123
Net Income		$	9,339			$	(2,724	)		$	6,615

Basis of Presentation

The unaudited pro forma condensed combined financial statements are based upon the historical consolidated financial statements of LSI Industries Inc. (LSI or Company) which were included in its Quarterly Report on Form 10-Q for the six months ended December 31, 2025, and Annual Report on Form 10-K for the year ended June 30, 2025, and Royston financial statements for the comparable periods are included in this Current Report on Form 8K. The unaudited pro forma condensed combined statements of operations for the six months ended December 31, 2025, and the year end June 30, 2025, combine the historical statements of operations of LSI and Royston, adjusted to reflect the pro forma effect as if the acquisition of Royston occurred on July 1, 2024 (the first day of the LSI’s 2025 fiscal year). The unaudited pro forma condensed combined balance sheet combines the historical balance sheets of LSI and Royston as of December 31, 2025, and reflects the pro forma effect as if the acquisition of Royston occurred on that date.

The unaudited proforma condensed combined financial information is based on management’s current best estimate of the assumptions and adjustments that are described in the accompanying notes. Accordingly, the pro forma adjustments are preliminary, subject to further revision as additional information becomes available and is analyzed and has been made solely for the purpose of providing unaudited pro forma condensed combined financial information. Differences between these preliminary accounting conclusions and estimates and the final accounting conclusions and amounts may occur as a result and these differences could have a material impact on the accompanying unaudited pro forma condensed combined financial information and the combined company’s future results of operations and financial position.

Pro Forma Adjustments

A – Estimated Purchase consideration for the acquisition of Royston Group (Royston) for $325 million which includes $320 million of cash and $5 million equity with the difference coming from the Company’s credit facility and through a private sale of equity. The Company anticipates raising $100 million net of discount with the remaining $240 million though the Company’s credit facility. Assume an average stock price of $21 per share through the private equity offering (totaling 4,761,905 shares) and $22 per share for the $5 million shares (totaling 227,272 shares) which are part of the purchase consideration. The value of these shares was determined at the close of business on 2/19/2026.

B – Adjust Royston’s fixed assets to the expected fair market value

C - Fair value estimate of Royston’s intangible assets

D – Estimated value of Royston’s goodwill

E – Elimination of Royston's existing debt

F - Elimination of Royston’s existing common stock and retained earnings

G – Acquisition transaction costs of $7 million

H – The increase in depreciation expense related to the fair value estimate of Royston’s fixed assets. Over a 6-month period, depreciation expense will increase $292K and over a 12-month period depreciation expense will increase $583K. The plant machinery and equipment will be mostly impacted by the revaluation, which carries a 10-year life.

I – To eliminate the intangible asset amortization expense recorded prior to acquisition and to record the amortization expense of Royston’s revalued intangible assets. Intangible assets will consist of the Royston Trade Name (indefinite life), Technology assets (7-year life), Non-Compete assets (5-year life), and a Customer Relation asset (20-year life). Amortization expense will be $3,515K over a 6-month period and $7,030K over a 12-month period.

Tradename - Indefinite life			23,600
Technology Asset - 7 year life			18,000
Non-Compete - 5 year life			1,400
Customer Relationship - 20 year life			84,000
			127,000

J – To remove private equity distribution fees from historical Royston totaling $378K for a 6-month period and $755K for a 12-month period that will not carryover to LSI.

K – To record the elimination of historical Royston interest expense of $12.2 million annually and $7.5 million over 6 months, and also record interest expense on borrowed funds to purchase Royston totaling $240 million plus existing revolver balance of $28M multiplied by the annual borrowing rate of 5.75% which equates to $15.4 million annually and 7.7 million over 6 months.

L – to apply a 21% statutory tax rate to the net effect of all proforma adjustments.

FAQ

What is LSI Industries (LYTS) paying to acquire Royston Group?

LSI Industries agreed to acquire Royston Group for an aggregate purchase price of $325 million. Of this, $320 million will be paid in cash at closing and $5 million will be paid in newly issued LSI common stock, valued using the February 19, 2026 closing price.

How will LSI Industries (LYTS) finance the Royston acquisition?

LSI plans to finance the Royston deal primarily through a new senior secured credit facility with PNC totaling $425 million. This includes a $200 million five‑year term loan, a $75 million one‑year term loan, and a $150 million revolver, plus an equity component from issuing LSI shares.

When is the LSI Industries (LYTS) acquisition of Royston expected to close?

The Royston acquisition is expected to close in the third quarter of LSI’s 2026 fiscal year. Closing depends on customary conditions, including expiration or termination of the Hart‑Scott‑Rodino waiting period, absence of prohibitive court orders, and no Material Adverse Effect as defined in the merger agreement.

How large is Royston compared with LSI Industries (LYTS)?

For the twelve months ended September 30, 2025, Royston generated about $271.8 million in net sales and adjusted EBITDA of approximately $38.0 million. Combined with LSI, pro forma trailing twelve‑month revenue is roughly $864.4 million and adjusted EBITDA about $95.3 million, materially increasing LSI’s scale.

What leverage does LSI Industries (LYTS) expect after acquiring Royston?

LSI expects net leverage to be approximately 3.0x at closing of the Royston acquisition. This leverage level reflects funding the $325 million purchase price mainly with the new senior secured credit facility, and management indicates a commitment to deleveraging while continuing to invest in organic growth.

Why does LSI Industries (LYTS) view the Royston acquisition as strategic?

LSI calls Royston a transformational platform that strengthens its position in branded retail solutions. The deal expands capabilities in cabinetry, fixtures, signage, and refrigerated cases, increases exposure to refueling, convenience, grocery, and QSR verticals, offers cross‑selling opportunities, and supports its Fast Forward value creation strategy and margin expansion goals.

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