Contract analysis

I. Executive Summary This memorandum analyzes the availability and scope of stockholder appraisal rights under Section 262 of the Delaware General Corporation Law (the "DGCL") in the context of the proposed acquisition (the "Transaction") of Cloudium Technologies plc, a public limited company incorporated under the laws of England and Wales ("Cloudium" or the "Company"), by Solara Digital Infrastructure Fund VI LP, a

II. Background A. Transaction Structure The Transaction is structured as a reverse triangular merger under the DGCL. Merger Sub, a Delaware corporation incorporated on January 8, 2024 (Delaware File No. 7923841), whose sole stockholder is Fund VI, will merge with and into Cloudium. Cloudium will be the surviving corporation in the Merger and will become a wholly owned subsidiary of Fund VI upon consummation of the Tr

III. Statutory Framework — DGCL § 262 A. Overview of Appraisal Rights

Section 262 of the DGCL provides a statutory remedy to stockholders of a Delaware corporation (or, as discussed below, stockholders of a constituent corporation in a DGCL-governed merger) who dissent from a merger or consolidation. The appraisal remedy entitles qualifying dissenting stockholders to receive payment of the "fair value" of their shares, as determined by the Delaware Court of Chancery, in lieu of the mer

Section 262(a) expressly provides that appraisal rights are available in mergers effected under Section 252. The statute does not distinguish between stockholders of the Delaware constituent corporation and stockholders of the foreign constituent corporation. Because the Merger Agreement provides that Cloudium stockholders' shares are being converted into cash consideration and the Merger is being effected under the

1. Written demand before the vote. A stockholder who wishes to exercise appraisal rights must deliver to Cloudium a written demand for appraisal before the stockholder vote on the Merger at the special meeting. The demand must reasonably inform the corporation of the identity of the stockholder and that the stockholder intends to demand appraisal of such stockholder's shares. DGCL § 262(d)(1). The demand must be sepa

2. No vote in favor of the Merger. A stockholder who wishes to preserve appraisal rights must not vote in favor of the Merger. DGCL § 262(a). A stockholder may vote against the Merger, abstain from voting, or fail to vote entirely. However, a vote in favor of the Merger—including by proxy—constitutes an irrevocable waiver of appraisal rights with respect to the shares so voted. If a stockholder votes some shares in f

3. Continuous ownership. The stockholder must continuously hold the shares of Cloudium common stock for which appraisal is demanded from the date of the written demand through the Effective Time of the Merger. DGCL § 262(a). Any transfer or disposition of shares after the demand is made and before the Effective Time will terminate the stockholder's appraisal rights with respect to the transferred shares. A stockholde

4. Petition to the Court of Chancery. Within 120 days after the Effective Time of the Merger, either the Surviving Corporation or any stockholder who has complied with the appraisal demand requirements may file a petition in the Delaware Court of Chancery demanding a determination of the fair value of the shares held by all dissenting stockholders. DGCL § 262(e). If neither the Surviving Corporation nor any dissentin

5. Verified petition. The petition filed in the Court of Chancery must be a verified petition setting forth the number and class of shares for which appraisal is demanded, the aggregate number of shares held by all petitioning stockholders, and such other information as may be required by the Court of Chancery. DGCL § 262(e). Upon the filing of a petition by any stockholder, service of a copy of the petition must be

6. Withdrawal right. A stockholder who has demanded appraisal may withdraw the demand and accept the Merger Consideration at any time within 60 days after the Effective Time of the Merger without the consent of the Surviving Corporation. DGCL § 262(e). After the expiration of the 60-day period, a stockholder may withdraw the demand and accept the Merger Consideration only with the written consent of the Surviving Cor

IV. Interaction with English Law — Scheme of Arrangement and Other Considerations A. Why a UK Scheme of Arrangement Was Not Used Acquisitions of UK public companies are frequently effected by way of a scheme of arrangement under Part 26 of the UK Companies Act 2006. A scheme of arrangement is a court-sanctioned process that requires: (i) approval by a majority in number representing at least 75% in value of each clas

V. Practical Considerations for the Solara Deal Team A. Stockholder Vote and Appraisal Demand Mechanics The Merger will require the approval of Cloudium's stockholders at a special meeting of stockholders. The anticipated timeline is as follows: the Definitive Proxy Statement is expected to be filed by Cloudium on or about April 15, 2024, and the special meeting is anticipated to be held in the second quarter of 2024

VI. Recommendations Based on the foregoing analysis, we make the following recommendations to the deal team:

1. Merger Agreement drafting. The Merger Agreement should expressly reference DGCL § 262 appraisal rights and include appropriate mechanics, including: (a) a requirement that Cloudium promptly deliver to Fund VI copies of all appraisal demands received before or after the stockholder vote; (b) an obligation on the part of the Surviving Corporation to send the post-merger notice required by § 262(d)(2) within 10 days

2. Proxy statement. The Definitive Proxy Statement should include the full text of DGCL § 262 as an annex, together with a clear and prominent summary of appraisal procedures, deadlines, and the consequences of non-compliance. The appraisal rights section should be drafted in close coordination with Ridgeway Phelps & Sato LLP (Catherine Answorth) to ensure accuracy and completeness.

3. Monitor dissenting shares. Between the mailing of the proxy statement and the stockholder vote, Cloudium should maintain a log of all appraisal demands received and should promptly notify Fund VI of any such demands. After the stockholder vote and before closing, the deal team should assess the volume of dissenting shares to quantify the potential appraisal exposure. This assessment should inform the closing condi

4. Post-closing compliance. The Surviving Corporation must send the § 262(d)(2) notice to all qualifying dissenting stockholders within 10