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In this paper, a particle-in-cell simulation of ion and neutral-beam extraction through a grid with high-aspect-ratio holes in contact with plasma was developed. Particular emphasis was placed on plasma molding over the holes, ion neutralization along the sidewall of the holes, and the energy and angular distributions of the residual ions and fast neutrals in the beam downstream of the holes. The target application was the generation of fast neutral beams for future charge-free microelectronics manufacturing. The energy and angular distributions of ions at different locations along the hole sidewall showed that ions which neutralize on the top section of the surface of the hole are “bad,” in the sense that these ions yield divergent neutral beams of relatively low energy. Ions that neutralize along the bottom section of the hole sidewall are “good,” in the sense that these ions yield neutral beams that are less divergent and retain more of the energy of the parent ions. A three-grid ion-extraction/neutralization system is proposed to increase the fraction of good ions and produce a higher quality neutral beam.