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Contract analysis / rwi-nbi-northfield.docx
rwi-nbi-northfield.docx
1041-00003 · 18 clauses
High · 7 Medium · 3 Standard · 3
I. INTRODUCTION AND PURPOSE
I. INTRODUCTION AND PURPOSE Northfield Assurance Ltd. ("Northfield" or the "Insurer") is pleased to provide this non-binding indication of terms (this "NBI," Reference No. NBI-2024-00487) for a buyer-side representation and warranty insurance policy (the "Policy") in connection with the proposed acquisition (the "Transaction") of Cloudium Technologies plc ("Cloudium" or the "Target"), a public limited company incorpo
II. TRANSACTION SUMMARY Standard
⚑ Commercial term
II. TRANSACTION SUMMARY A. Transaction Overview The Transaction is structured as a reverse triangular merger under the Delaware General Corporation Law (the "DGCL"), pursuant to which Merger Sub will merge with and into Cloudium, with Cloudium surviving the merger as a wholly owned subsidiary of Fund VI. The aggregate enterprise value of the Transaction is approximately $6,800,000,000 (the "Deal Value"). Based on app
III. PROPOSED POLICY TERMS High
⚑ Indemnity / guarantee obligation
III. PROPOSED POLICY TERMS A. Named Insured The Named Insured under the Policy will be: (i) Solara Digital Infrastructure Fund VI LP; (ii) Stratos Merger Sub Inc.; (iii) Cloudium Technologies plc (as the surviving corporation following the merger); (iv) All direct and indirect subsidiaries of the surviving corporation existing as of the closing date (including, without limitation, Cloudium Technologies UK Ltd., Cloud
IV. COVERED REPRESENTATIONS AND WARRANTIES Medium
⚑ Forum / governing law
IV. COVERED REPRESENTATIONS AND WARRANTIES A. Scope of Coverage Subject to the exclusions described in Section V below and the terms, conditions, and limitations of the Policy (as finally agreed), the Policy is intended to cover losses incurred by the Named Insured arising from any breach of the Seller's representations and warranties as set forth in Article IV of the Merger Agreement. Based on Northfield's review of
V. KEY EXCLUSIONS High
⚑ Penalty / liquidated damages
V. KEY EXCLUSIONS A. Standard Exclusions The Policy will contain the following standard exclusions, which are customary for buyer-side representation and warranty insurance policies of this nature: (i) Known Loss Exclusion. The Policy will not cover losses arising from matters actually known to the Named Insured (or to any member of the "deal team" of the Named Insured, which shall include the partners, associates, a
VI. SUBROGATION
VI. SUBROGATION Upon payment of a covered loss under the Policy, the Insurer will be subrogated to the Named Insured's rights of recovery against responsible third parties to the extent of such payment. However, the Insurer waives its right of subrogation against the following persons and entities: (a) Cloudium Technologies plc and each of its direct and indirect subsidiaries (including Cloudium Technologies UK Ltd.,
VII. INTERPLAY WITH MERGER AGREEMENT INDEMNIFICATION High
⚑ Indemnity / guarantee obligation
VII. INTERPLAY WITH MERGER AGREEMENT INDEMNIFICATION A. Indemnification Framework Based on Northfield's review of the draft Merger Agreement, the indemnification framework applicable to the Transaction is expected to include the following key terms: The foregoing summary is based on the draft Merger Agreement currently under review and is subject to change. Northfield will review the execution version of the Merger A
VIII. CLAIMS PROCESS (SUMMARY) High
⚑ Indemnity / guarantee obligation
VIII. CLAIMS PROCESS (SUMMARY) The claims process under the Policy is expected to be governed by the following procedures, subject to the final terms of the Policy wording: Notice of Claim. The Named Insured shall provide written notice of any claim or potential claim under the Policy to: Northfield Assurance Ltd. Attention: Patrick Graves, Senior Vice President, Transactional Risk 30 St Mary Axe London EC3A 8BF Unit
IX. CONDITIONS TO BINDING Standard
⚑ Commercial term
IX. CONDITIONS TO BINDING Northfield's issuance of a binding policy is subject to the satisfaction of the following conditions: (a) Completion of Underwriting Diligence. Northfield must complete its underwriting diligence to its satisfaction, including: (1) Review of the final (execution version) Merger Agreement, including all schedules, exhibits, and ancillary documents; (2) Review of the final Disclosure Schedules
X. GOVERNING LAW AND DISPUTE RESOLUTION Medium
⚑ Forum / governing law
X. GOVERNING LAW AND DISPUTE RESOLUTION The Policy shall be governed by, and construed in accordance with, the laws of the State of New York, without regard to conflicts of law principles that would result in the application of the laws of any other jurisdiction. Any dispute, controversy, or claim arising out of or relating to the Policy, including the formation, interpretation, performance, breach, or termination th
XI. CONFIDENTIALITY Medium
⚑ Confidentiality undertaking
XI. CONFIDENTIALITY This NBI and all related communications, correspondence, term sheets, and underwriting materials exchanged between Northfield and the Broker, the Named Insured, and their respective advisors in connection with the placement of the Policy (collectively, "Confidential Information") are strictly confidential and may not be disclosed to any third party without the prior written consent of Northfield,
XII. CONTACT INFORMATION
XII. CONTACT INFORMATION All inquiries, submissions, and communications relating to this NBI and the proposed Policy should be directed to: Northfield Assurance Ltd. — Underwriting Contact: Patrick Graves Senior Vice President, Transactional Risk Northfield Assurance Ltd. 30 St Mary Axe London EC3A 8BF United Kingdom Tel: +44 (0) 20 7946 0832 Email: patrick.graves@northfieldassurance.com Peregrine Advisory Group LLC
XIII. DISCLAIMERS High
⚑ Indemnity / guarantee obligation
XIII. DISCLAIMERS This NBI is non-binding and is provided for discussion purposes only. Northfield Assurance Ltd. reserves the right to modify, supplement, or withdraw these proposed terms at any time prior to the execution of a binding binder agreement. This NBI does not constitute an offer of insurance, a commitment to issue a policy of insurance, or a binder of coverage, and should not be relied upon as such by an
1. The Retention of $544,000,000 is equal to the indemnity escrow amount to be deposited Standard
⚑ Commercial term
1. The Retention of $544,000,000 is equal to the indemnity escrow amount to be deposited with Cobalt Trust Company at closing.
2. The 50% Retention drop-down to $272,000,000 at 12 months post-closing is designed to a
2. The 50% Retention drop-down to $272,000,000 at 12 months post-closing is designed to align with the scheduled partial release of 50% of the indemnity escrow.
3. The R&W Policy Limit of $680,000,000 (10% of Deal Value) provides coverage above the R
3. The R&W Policy Limit of $680,000,000 (10% of Deal Value) provides coverage above the Retention up to a combined aggregate of $1,224,000,000 (at initial Retention level) or $952,000,000 (at Reduced Retention level).
4. The R&W Policy period for general representations (3 years) and Fundamental Representa High
⚑ Indemnity / guarantee obligation
4. The R&W Policy period for general representations (3 years) and Fundamental Representations (6 years) extends beyond the 18-month survival period under the Merger Agreement, providing the Named Insured with continued coverage after direct indemnification rights have expired.
5. The Policy Limit is an aggregate limit inclusive of defense costs. High
⚑ Indemnity / guarantee obligation
5. The Policy Limit is an aggregate limit inclusive of defense costs. This Appendix A is provided for illustrative purposes only and is not part of the Policy or the NBI. The actual terms, conditions, and structure of the Policy will be as set forth in the final Policy wording. [END OF NON-BINDING INDICATION] Northfield Assurance Ltd. | 30 St Mary Axe, London EC3A 8BF | Registered in England and Wales | Company No. 0