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SOLVENCY CERTIFICATE

Delivered pursuant to Section 4.01(h) of the Mezzanine Credit Agreement, dated as of September 14, 2023 (as amended, restated, supplemented, or otherwise modified from time to time, the "Mezzanine Credit Agreement"), among Stonefield Logistics Group Inc., a Delaware corporation (the "Borrower"), Ridgeline Mezzanine Capital Fund III, LP, a Delaware limited partnership (the "Mezzanine Lender"), and the guarantors party thereto

Date: September 29, 2023

Delivered to:

Ridgeline Mezzanine Capital Fund III, LP 767 Lexington Avenue, 22nd Floor New York, New York 10065

Attention: Katherine M. Stroud, Managing Director

RECITALS AND INTRODUCTORY STATEMENTS

The undersigned, Janet R. Prescott, Chief Financial Officer of Stonefield Logistics Group Inc., a corporation duly organized and existing under the laws of the State of Delaware, with its principal executive office located at 4800 Commerce Parkway, Suite 1200, Fort Worth, Texas 76107 (the "Borrower"), hereby certifies as follows:

This Solvency Certificate (this "Certificate") is delivered in connection with the closing of the $120,000,000 mezzanine term loan facility on September 29, 2023 (the "Closing Date"), as required by Section 4.01(h) of the Mezzanine Credit Agreement. The delivery of this Certificate is a condition precedent to the obligation of the Mezzanine Lender to fund the mezzanine term loan on the Closing Date.

Capitalized terms used but not otherwise defined herein shall have the meanings assigned to such terms in the Mezzanine Credit Agreement. All section references herein to the Mezzanine Credit Agreement refer to the Mezzanine Credit Agreement as in effect on the date hereof.

The undersigned is the duly appointed Chief Financial Officer of the Borrower and is authorized to execute and deliver this Certificate on behalf of the Borrower. The undersigned is familiar with the financial condition, business operations, assets, liabilities, and affairs of the Borrower and each of its direct and indirect subsidiaries, and has the requisite knowledge, experience, and authority to provide the certifications set forth herein.

In connection with the preparation and delivery of this Certificate, the undersigned has made such investigations and inquiries as she has deemed necessary and appropriate, including without limitation a thorough review of the financial condition, assets (both tangible and intangible), liabilities (including contingent liabilities), cash flows, capital structure, and business prospects of the Borrower and its subsidiaries on a consolidated basis. Such review encompassed, among other things, an examination of the audited consolidated financial statements of the Borrower for the fiscal year ended December 31, 2022, as audited by Braddock & Saylor LLP, the unaudited interim consolidated financial statements for the six-month period ended June 30, 2023, the Borrower's internal financial projections and business plans, the terms and conditions of all outstanding indebtedness of the Borrower and its subsidiaries, and the terms and conditions of the Transactions (as defined below).

The certifications set forth in this Certificate are made after giving pro forma effect to each of the following (collectively, the "Transactions"):

(a) the incurrence of $120,000,000 in mezzanine indebtedness under the Mezzanine Credit Agreement;

(b) the payment of all fees, costs, and expenses incurred in connection with the Transactions, totaling approximately $4,562,500, consisting of:

(i) a commitment fee of $2,400,000 (2.0% of the aggregate mezzanine term loan commitment) payable to Ridgeline Mezzanine Capital Fund III, LP;

(ii) a financial advisory fee of $900,000 payable to Zynvaro Thornton Advisory Group, LLC, financial advisor to the Borrower;

(iii) legal fees and disbursements of $675,000 payable to Calderwood & Harkness LLP, counsel to the Borrower, in connection with the negotiation, documentation, and closing of the Transactions;

(iv) reimbursement of legal fees and disbursements in the amount of $450,000 payable to Archer Blackwell & Moss LLP, counsel to the Mezzanine Lender, as required under Section 10.04 of the Mezzanine Credit Agreement; and

(v) a Senior Agent amendment fee of $137,500 payable to Whitmore National Bank, N.A., in its capacity as Administrative Agent and Collateral Agent under the Senior Credit Agreement, in connection with the execution and delivery of Amendment No. 3 to the Senior Credit Agreement;

(c) the application of net mezzanine proceeds (after payment of the fees and expenses described in clause (b) above) to fund capital expenditures for the fleet expansion program, terminal facility buildout initiative, and technology upgrade program, in each case as described in the capital expenditure budget approved by the Board of Directors of the Borrower and delivered to the Mezzanine Lender pursuant to Section 6.01(e) of the Mezzanine Credit Agreement; and

(d) all other transactions contemplated by the Mezzanine Credit Agreement and the related transaction documents (including the Mezzanine Guaranty Agreement, the Mezzanine Pledge and Security Agreement, the Parent Equity Pledge Agreement, the Warrant Agreement, the Intercreditor Agreement, and Amendment No. 3 to the Senior Credit Agreement) to occur on or before the Closing Date.

SECTION 1: DEFINITIONS

For purposes of this Certificate, the following terms shall have the meanings set forth below:

"Fair Value" means the amount at which the assets (both tangible and intangible), in their entirety, of the Borrower and its subsidiaries on a consolidated basis would change hands between a willing buyer and a willing seller, within a commercially reasonable period of time, each having reasonable knowledge of the relevant facts, with neither being under any compulsion to act. For purposes of this definition, "tangible assets" include, without limitation, fleet vehicles, trailers, rolling stock, equipment, terminal facilities, real property, accounts receivable, inventory, cash and cash equivalents, and other personal and real property. "Intangible assets" include, without limitation, customer contracts and relationships, intellectual property, trade names and trademarks, technology and software, workforce in place, permits and licenses, and the going-concern value of the business as an operating enterprise. Fair Value is determined on a going-concern basis and does not assume a forced sale, liquidation, or distressed disposition of such assets.

"Fair Saleable Value" means the amount that could be obtained by an independent willing seller from an independent willing buyer if the assets of the Borrower and its subsidiaries on a consolidated basis were sold with reasonable promptness in an arm's-length transaction under present conditions for the sale of comparable business enterprises insofar as such conditions can reasonably be evaluated, as such conditions may reasonably be expected to exist. Fair Saleable Value contemplates a sale of the business as a going concern, but takes into account the market conditions, time period, and circumstances under which such a sale might reasonably be consummated. Fair Saleable Value may differ from Fair Value to the extent that market conditions, time constraints, or other factors would cause the realizable value to be higher or lower than Fair Value.

"Total Liabilities" means the total amount of all liabilities (including contingent liabilities, whether matured, unmatured, liquidated, unliquidated, disputed, or undisputed) of the Borrower and its subsidiaries on a consolidated basis, as would be reflected on a consolidated balance sheet of the Borrower prepared in accordance with generally accepted accounting principles in the United States ("GAAP") consistently applied, after giving pro forma effect to the Transactions. Total Liabilities include, without limitation, the following indebtedness outstanding on the Closing Date after giving effect to the Transactions:

(a) Senior Secured Term Loan B: $275,000,000 principal amount outstanding, bearing interest at SOFR plus 375 basis points per annum (with a SOFR floor of 75 basis points), maturing November 15, 2026, incurred under the Amended and Restated Credit Agreement, dated as of April 7, 2022 (originally dated as of November 15, 2019, as amended and restated on April 7, 2022, and as further amended by Amendment No. 1 dated October 12, 2022, Amendment No. 2 dated March 3, 2023, and Amendment No. 3 dated September 29, 2023), among the Borrower, Whitmore National Bank, N.A. as Administrative Agent and Collateral Agent, and the lenders party thereto from time to time (as so amended and restated, the "Senior Credit Agreement");

(b) Senior Secured Revolving Credit Facility: $12,000,000 principal amount drawn as of the Closing Date (of $50,000,000 aggregate committed revolving loan commitments), bearing interest at SOFR plus 350 basis points per annum (with a SOFR floor of 50 basis points), maturing November 15, 2025, incurred under the Senior Credit Agreement;

(c) Mezzanine Term Loan: $120,000,000 principal amount outstanding, bearing interest at a blended rate of 1,100 basis points per annum, consisting of 850 basis points of current-pay cash interest and 250 basis points of payment-in-kind ("PIK") interest that accrues and is capitalized to the outstanding principal balance quarterly, maturing September 29, 2029, incurred under the Mezzanine Credit Agreement; and

(d) Total Funded Debt at Closing: $407,000,000, representing the sum of the amounts set forth in clauses (a), (b), and (c) above.

Total Liabilities also include all trade payables, accrued expenses, deferred revenue, pension and post-retirement benefit obligations, operating lease liabilities, tax liabilities (whether current or deferred), intercompany liabilities (to the extent not eliminated in consolidation), and all other obligations of whatever nature that would be required to be reflected as liabilities on a consolidated balance sheet prepared in accordance with GAAP.

"Stated Liabilities" means the stated or determinable amount of all liabilities as recorded on the books and records of the Borrower and its subsidiaries as of the Closing Date, determined in accordance with GAAP. For the avoidance of doubt, Stated Liabilities include only those liabilities that are reflected or required to be reflected on the Borrower's consolidated balance sheet as of the Closing Date and do not include contingent liabilities that are not required to be recognized as liabilities under GAAP, except to the extent that such contingent liabilities have been so recorded.

"Transactions" means, collectively, (a) the entering into of the Mezzanine Credit Agreement and each of the ancillary and related documents executed and delivered in connection therewith (including the Mezzanine Guaranty Agreement, the Mezzanine Pledge and Security Agreement, the Parent Equity Pledge Agreement, the Warrant Agreement granting to the Mezzanine Lender warrants representing 3.0% of the fully-diluted equity of the Borrower, the Intercreditor Agreement among Whitmore National Bank, N.A. and the Mezzanine Lender, and Amendment No. 3 to the Senior Credit Agreement), (b) the borrowing of the $120,000,000 mezzanine term loan on the Closing Date, (c) the issuance of warrants to the Mezzanine Lender representing 3.0% of the fully-diluted equity of the Borrower, exercisable at a nominal strike price, (d) the payment of all fees, costs, and expenses related to the foregoing, and (e) the application of the net proceeds of the mezzanine term loan for the purposes described in Section 6.10 of the Mezzanine Credit Agreement.

SECTION 2: FINANCIAL OVERVIEW AND BASIS FOR CERTIFICATIONS

In making the certifications set forth in Section 3 below, the undersigned has reviewed and considered, among other things, the following key financial data and information relating to the Borrower and its subsidiaries on a consolidated basis:

Historical Financial Performance

(a) FY2022 Revenue: $687,000,000, as reflected in the audited consolidated financial statements of the Borrower for the fiscal year ended December 31, 2022, prepared in accordance with GAAP and audited by Braddock & Saylor LLP, independent registered public accounting firm. Braddock & Saylor LLP issued an unqualified audit opinion with respect to such financial statements, dated March 17, 2023.

(b) FY2022 Adjusted EBITDA: $98,400,000, representing an Adjusted EBITDA margin of approximately 14.3%. Adjusted EBITDA is calculated in accordance with the definition set forth in Section 1.01 of the Mezzanine Credit Agreement and reflects adjustments for non-cash stock-based compensation expense, sponsor management fees, acquisition-related costs, non-recurring restructuring charges, and other items expressly permitted under the definition thereof.

(c) LTM Adjusted EBITDA as of June 30, 2023: $108,600,000, as reported in the Compliance Certificate delivered pursuant to Section 6.02 of the Senior Credit Agreement for the fiscal quarter ended June 30, 2023. The increase from FY2022 Adjusted EBITDA reflects continued organic growth in the Borrower's LTL and intermodal freight operations, improved pricing discipline, and operational efficiency gains realized during the first half of fiscal year 2023.

Pro Forma Capital Structure at Closing

Leverage and Coverage Metrics

(a) Total Leverage at Closing: 3.75x, calculated as Total Funded Debt of $407,000,000 divided by LTM Adjusted EBITDA of $108,600,000. This ratio is within the Maximum Total Leverage Ratio of 4.25x required under Section 7.11(a) of the Mezzanine Credit Agreement. The Mezzanine Credit Agreement provides for step-downs in the Maximum Total Leverage Ratio to 4.00x beginning with the fiscal quarter ending September 30, 2024, and to 3.75x beginning with the fiscal quarter ending September 30, 2025.

(b) Senior Leverage at Closing: 2.64x, calculated as Senior Funded Debt of $287,000,000 (consisting of $275,000,000 Senior Secured Term Loan B and $12,000,000 drawn under the Senior Secured Revolving Credit Facility) divided by LTM Adjusted EBITDA of $108,600,000.

(c) Minimum Liquidity: As of the Closing Date, after giving pro forma effect to the Transactions, the Borrower has unrestricted cash and cash equivalents plus available and undrawn revolving credit facility commitments (net of any outstanding letters of credit) in excess of $15,000,000, which is the minimum liquidity threshold required under Section 7.11(c) of the Mezzanine Credit Agreement. Specifically, as of the Closing Date, the Borrower has approximately $38,000,000 of undrawn revolving credit facility capacity ($50,000,000 of aggregate revolving commitments less $12,000,000 drawn), in addition to unrestricted cash and cash equivalents on the balance sheet.

Ownership and Sponsorship

The Borrower's equity sponsor is Cascade Ridge Capital Partners, LLC, a Delaware limited liability company, which holds a 78.4% ownership interest in the Borrower through its wholly-owned subsidiary, Cascade Ridge SLG Holdings, LLC. Stonefield Logistics Group Inc. was acquired by Cascade Ridge Capital Partners, LLC in November 2019 for an enterprise value of approximately $520,000,000 in a management-led leveraged buyout transaction. The remaining equity interests are held by management and certain co-investors. Since the acquisition, the Borrower has grown its revenue from $512,000,000 in FY2019 to $687,000,000 in FY2022, representing a compound annual growth rate of approximately 10.3%.

Subsidiary Guarantors

The Borrower's direct and indirect wholly-owned subsidiaries — Stonefield Intermodal Services, Inc., a Delaware corporation, Stonefield Fleet Management, LLC, a Delaware limited liability company, and Stonefield Freight Brokerage, Inc., a Delaware corporation — are each guarantors under both the Senior Credit Agreement and the Mezzanine Credit Agreement. Each such subsidiary is an integral part of the Borrower's consolidated operations and contributes meaningfully to the consolidated revenues and Adjusted EBITDA of the Borrower and its subsidiaries taken as a whole. The certifications in this Certificate are made with respect to the Borrower and its subsidiaries on a consolidated basis, inclusive of each such subsidiary guarantor.

SECTION 3: SOLVENCY CERTIFICATIONS

Based upon the foregoing, and after giving pro forma effect to the Transactions as of the Closing Date, the undersigned hereby certifies, in her capacity as Chief Financial Officer of the Borrower and not in her individual capacity, as follows:

Section 3(a): Balance Sheet Solvency — Fair Value Exceeds Total Liabilities

As of the Closing Date, after giving pro forma effect to the Transactions, the Fair Value of the assets of the Borrower and its subsidiaries, taken as a whole on a consolidated basis, exceeds the Total Liabilities (including subordinated, contingent, matured, unmatured, liquidated, and unliquidated liabilities) of the Borrower and its subsidiaries, taken as a whole on a consolidated basis.

In reaching this conclusion, the undersigned has considered the Fair Value of the Borrower's tangible assets, including without limitation its fleet of owned and leased vehicles, trailers, and rolling stock, its terminal facilities and related real property interests across the Borrower's national network, equipment, accounts receivable, inventory, and cash and cash equivalents. The undersigned has also considered the Fair Value of the Borrower's intangible assets, including without limitation the value of the Borrower's long-standing customer contracts and customer relationships, intellectual property (including proprietary logistics software and technology platforms), trade names and brand recognition in the LTL and intermodal freight sector, workforce in place, permits and operating authorities, and the going-concern value of the Borrower's consolidated business as an operating enterprise. The undersigned has evaluated these assets in relation to the $407,000,000 of total funded debt outstanding as of the Closing Date (after giving pro forma effect to the Transactions) and all other liabilities of the Borrower and its subsidiaries on a consolidated basis, and has concluded that the Fair Value of such assets exceeds the Total Liabilities of the Borrower and its subsidiaries. In this regard, the undersigned notes that the enterprise value at which the Borrower was acquired by Cascade Ridge Capital Partners, LLC in November 2019 was approximately $520,000,000, and that the Borrower's business has grown substantially since that date. The undersigned believes that the current Fair Value of the Borrower's assets, taken as a whole, materially exceeds the Total Liabilities of the Borrower and its subsidiaries after giving effect to the Transactions.

Section 3(b): Fair Saleable Value Exceeds Stated Liabilities

As of the Closing Date, after giving pro forma effect to the Transactions, the Fair Saleable Value of the assets of the Borrower and its subsidiaries, taken as a whole on a consolidated basis, is greater than the total amount of the Stated Liabilities of the Borrower and its subsidiaries, taken as a whole on a consolidated basis.

The Borrower's operating business in the national less-than-truckload and intermodal freight sector is a well-established, revenue-generating enterprise with a diversified customer base spanning multiple end-markets, a national terminal network, a modern fleet, and a growing technology platform that enhances operational efficiency and customer service. Such a business generates significant enterprise value in excess of the book value of its individual assets. The undersigned has considered the conditions under which the assets of the Borrower and its subsidiaries could be sold with reasonable promptness in an arm's-length transaction, including the active M&A market for transportation and logistics businesses, the availability of financing for potential acquirers, and the Borrower's competitive positioning within its industry. Based on these considerations, the undersigned has concluded that the Fair Saleable Value of the Borrower's assets, taken as a whole on a consolidated basis, exceeds the total amount of the Stated Liabilities of the Borrower and its subsidiaries.

Section 3(c): Adequate Capital — Not Unreasonably Small Capital

As of the Closing Date, after giving pro forma effect to the Transactions, the Borrower and its subsidiaries, taken as a whole on a consolidated basis, have sufficient capital to carry on their businesses and all businesses in which they are about to engage, and do not have unreasonably small capital with which to conduct the businesses in which they are engaged or are about to engage.

In reaching this conclusion, the undersigned has considered, among other things, the following factors:

(a) The capital expenditure program to be funded in whole or in part with the net proceeds of the mezzanine term loan — encompassing the fleet expansion initiative (addition of approximately 350 new Class 8 tractors and 600 new trailers), the terminal facility buildout (expansion or construction of terminals in six metropolitan service areas), and the technology upgrade program (deployment of next-generation transportation management system and real-time shipment visibility platform) — is projected to generate incremental revenue and Adjusted EBITDA sufficient to service the additional indebtedness incurred under the Mezzanine Credit Agreement. Management's internal projections, which the undersigned believes are prepared on a reasonable basis in light of historical performance and current market conditions, indicate that the capital expenditure program will contribute incremental annualized Adjusted EBITDA of approximately $18,000,000 to $24,000,000 upon full deployment, which is expected to occur by the end of fiscal year 2025.

(b) The Maximum Capital Expenditures covenant under Section 7.11(d) of the Mezzanine Credit Agreement permits capital expenditures of up to $85,000,000 per fiscal year, with the ability to carry forward up to 25% of any unused annual capital expenditure allowance to the immediately succeeding fiscal year. This covenant provides the Borrower with adequate flexibility to execute its capital expenditure program while maintaining compliance with the financial covenants contained in the Mezzanine Credit Agreement.

(c) The Borrower maintains access to $38,000,000 of undrawn revolving credit facility capacity ($50,000,000 of aggregate revolving commitments less $12,000,000 currently drawn) under the Senior Credit Agreement, in addition to the net proceeds of the mezzanine term loan, providing significant additional liquidity to fund working capital needs, seasonal fluctuations in operating cash flow, and other general corporate purposes. The Borrower's unrestricted cash on hand, combined with such undrawn revolving capacity, substantially exceeds the $15,000,000 minimum liquidity requirement under the Mezzanine Credit Agreement.

(d) The Borrower's business generates substantial operating cash flow, with LTM Adjusted EBITDA of $108,600,000 as of June 30, 2023. After deducting estimated annual cash interest expense on total funded debt, estimated maintenance capital expenditures, estimated cash taxes, and estimated working capital requirements, the Borrower is expected to generate meaningful free cash flow available to fund operations, growth investments, and debt service.

Based on the foregoing, the undersigned has concluded that the Borrower and its subsidiaries, taken as a whole on a consolidated basis, have adequate capital and do not have unreasonably small capital with which to conduct their businesses.

Section 3(d): Ability to Pay Debts as They Become Due

As of the Closing Date, after giving pro forma effect to the Transactions, the Borrower and its subsidiaries, taken as a whole on a consolidated basis, are able to pay their debts and other liabilities (including trade payables, contractual obligations, and contingent obligations) as they become due in the ordinary course of business.

In reaching this conclusion, the undersigned has considered the projected cash flows of the Borrower and its subsidiaries on a consolidated basis, taking into account the following:

(a) Debt service requirements, including (i) quarterly cash interest payments on the $120,000,000 mezzanine term loan at 850 basis points per annum (approximately $2,550,000 per quarter), (ii) PIK interest accrual on the mezzanine term loan at 250 basis points per annum (approximately $750,000 per quarter, which accrues and capitalizes to principal and does not require current cash payment), (iii) quarterly cash interest payments on the $275,000,000 Senior Secured Term Loan B at SOFR plus 375 basis points per annum (approximately $6,187,500 per quarter at current SOFR rates), (iv) quarterly amortization payments on the Senior Secured Term Loan B (at 1.0% per annum of the original principal amount, or approximately $687,500 per quarter), and (v) interest on the drawn portion of the Senior Secured Revolving Credit Facility;

(b) Planned capital expenditures, including the fleet expansion, terminal facility buildout, and technology upgrade program, which are expected to be funded primarily with the net proceeds of the mezzanine term loan and internally generated cash flow;

(c) Working capital needs, including trade payables, payroll obligations, fuel costs, insurance premiums, equipment maintenance costs, and other operating expenses that arise in the ordinary course of the Borrower's business; and

(d) Other fixed charges, including operating lease payments, insurance premiums, and tax obligations.

The Minimum Fixed Charge Coverage Ratio of 1.10x required under Section 7.11(b) of the Mezzanine Credit Agreement is expected to be satisfied for each measurement period during the term of the Mezzanine Credit Agreement, based on the Borrower's projected cash flows and the undersigned's analysis of the Borrower's ability to generate Adjusted EBITDA sufficient to cover its fixed charges. This analysis indicates that the Borrower's consolidated cash flows are expected to be sufficient to meet all of the Borrower's and its subsidiaries' obligations as they become due in the ordinary course of business.

The first interest payment date under the Mezzanine Credit Agreement is December 29, 2023 (representing the initial quarterly interest period from the Closing Date through December 29, 2023). The undersigned expects that the Borrower will have sufficient cash on hand and available liquidity to make such interest payment when due, taking into account the Borrower's anticipated operating cash flows and available revolving credit facility capacity during such period.

Section 3(e): No Intent to Hinder, Delay, or Defraud Creditors

The Borrower has not incurred and does not intend to incur debts beyond its ability to pay as such debts mature. The Borrower has not entered into the Transactions, and is not entering into the Transactions, with the actual intent to hinder, delay, or defraud any person to which the Borrower or any of its subsidiaries is, or may become, indebted. The incurrence of the mezzanine term loan indebtedness and the consummation of the other Transactions have been undertaken in good faith and for legitimate business purposes, including the funding of capital expenditure initiatives expected to enhance the Borrower's revenue-generating capacity, operational efficiency, and competitive positioning within the LTL and intermodal freight industry.

SECTION 4: QUALIFICATIONS AND ASSUMPTIONS

The certifications set forth in Section 3 of this Certificate are subject to the following qualifications and assumptions:

(a) The certifications are based upon financial information available to the undersigned as of the Closing Date, and upon estimates and assumptions that the undersigned believes to be reasonable as of such date, in light of current conditions and the Borrower's historical financial performance. The undersigned recognizes that forward-looking estimates and assumptions are inherently subject to uncertainty, and that actual results may differ from the estimates and assumptions underlying the certifications contained herein.

(b) The undersigned is not expressing an opinion as to the value of any specific asset of the Borrower or any of its subsidiaries, or as to the price at which any individual asset or group of assets could be sold in a particular transaction. The certifications herein relate to the Fair Value and Fair Saleable Value of the assets of the Borrower and its subsidiaries taken as a whole on a consolidated basis, and not to the value of any particular asset or class of assets.

(c) The certifications contained herein do not constitute a guaranty or assurance that the Borrower will remain solvent, or that any particular financial result will be achieved, at any future date, and are given solely as of the Closing Date after giving pro forma effect to the Transactions. No representation or warranty is made as to the future financial condition or solvency of the Borrower or any of its subsidiaries at any time after the Closing Date.

(d) The undersigned has assumed that the audited consolidated financial statements of the Borrower for the fiscal year ended December 31, 2022 (prepared by Braddock & Saylor LLP, independent registered public accounting firm) and the unaudited interim consolidated financial statements of the Borrower for the six-month period ended June 30, 2023, in each case as delivered to the Mezzanine Lender pursuant to the Mezzanine Credit Agreement, are accurate in all material respects and present fairly, in all material respects, the consolidated financial position and results of operations of the Borrower and its subsidiaries for the periods covered thereby, in conformity with GAAP (subject, in the case of the unaudited interim financial statements, to normal year-end audit adjustments and the absence of footnote disclosures).

(e) The undersigned has relied upon the Borrower's internal financial projections, forecasts, and business plans, which the undersigned believes are prepared on a reasonable basis and reflect the Borrower's good faith estimates and assumptions regarding future operating performance, revenue growth, capital expenditure requirements, debt service obligations, working capital needs, and other factors relevant to the certifications herein. However, the undersigned acknowledges that such projections, forecasts, and business plans are inherently uncertain, are based on numerous assumptions (including assumptions regarding general economic conditions, industry trends, competitive dynamics, fuel costs, labor markets, and regulatory developments), and are not a guarantee of future performance. No assurance can be given that the actual results of the Borrower's operations will conform to such projections, forecasts, or business plans.

(f) The undersigned has assumed that the representations and warranties made by the Borrower and each guarantor in the Mezzanine Credit Agreement and the related transaction documents are true and correct in all material respects as of the Closing Date, and that no Default or Event of Default exists under the Mezzanine Credit Agreement or the Senior Credit Agreement as of the Closing Date.

SECTION 5: RELIANCE AND USE

This Certificate is delivered for the sole benefit of Ridgeline Mezzanine Capital Fund III, LP, in its capacity as Mezzanine Lender under the Mezzanine Credit Agreement, and may be relied upon by such party in connection with the funding of the mezzanine term loan on the Closing Date. The Mezzanine Lender is entitled to rely on this Certificate in making its decision to fund the mezzanine term loan, and in connection with the satisfaction of the conditions precedent to funding set forth in Article IV of the Mezzanine Credit Agreement.

This Certificate may not be relied upon by any other person or entity, or for any other purpose, without the prior written consent of the Borrower. Without limiting the foregoing, this Certificate is not intended for the benefit of, and shall not be relied upon by, any trade creditor, bondholder, shareholder, equity holder, or any other creditor or stakeholder of the Borrower or any of its affiliates, and the undersigned expressly disclaims any duty or obligation to any such person in connection with the certifications contained herein. This Certificate does not create any fiduciary duty, attorney-client relationship, or other professional relationship between the undersigned and the Mezzanine Lender or any other party.

IN WITNESS WHEREOF, the undersigned has executed and delivered this Solvency Certificate as of the date first written above.

STONEFIELD LOGISTICS GROUP INC.

By: ________

Name: Janet R. Prescott

Title: Chief Financial Officer

Date: September 29, 2023

Facility	Principal Amount	Rate	Maturity
Senior Secured Term Loan B	$275,000,000	SOFR + 375 bps	November 15, 2026
Senior Secured Revolving Credit Facility (drawn)	$12,000,000	SOFR + 350 bps	November 15, 2025
Mezzanine Term Loan	$120,000,000	850 bps cash / 250 bps PIK	September 29, 2029
Total Funded Debt	$407,000,000

SOLVENCY CERTIFICATE
Delivered pursuant to Section 4.01(h) of the Mezzanine Credit Agreement, dated as of September 14, 2023 (as amended, restated, supplemented, or otherwise modified from time to time, the "Mezzanine Credit Agreement"), among Stonefield Logistics Group Inc., a Delaware corporation (the "Borrower"), Ridgeline Mezzanine Capital Fund III, LP, a Delaware limited partnership (the "Mezzanine Lender"), and the guarantors party thereto
Date: September 29, 2023
Delivered to:
Ridgeline Mezzanine Capital Fund III, LP 767 Lexington Avenue, 22nd Floor New York, New York 10065
Attention: Katherine M. Stroud, Managing Director
RECITALS AND INTRODUCTORY STATEMENTS
The undersigned, Janet R. Prescott, Chief Financial Officer of Stonefield Logistics Group Inc., a corporation duly organized and existing under the laws of the State of Delaware, with its principal executive office located at 4800 Commerce Parkway, Suite 1200, Fort Worth, Texas 76107 (the "Borrower"), hereby certifies as follows:
This Solvency Certificate (this "Certificate") is delivered in connection with the closing of the $120,000,000 mezzanine term loan facility on September 29, 2023 (the "Closing Date"), as required by Section 4.01(h) of the Mezzanine Credit Agreement. The delivery of this Certificate is a condition precedent to the obligation of the Mezzanine Lender to fund the mezzanine term loan on the Closing Date.
Capitalized terms used but not otherwise defined herein shall have the meanings assigned to such terms in the Mezzanine Credit Agreement. All section references herein to the Mezzanine Credit Agreement refer to the Mezzanine Credit Agreement as in effect on the date hereof.
The undersigned is the duly appointed Chief Financial Officer of the Borrower and is authorized to execute and deliver this Certificate on behalf of the Borrower. The undersigned is familiar with the financial condition, business operations, assets, liabilities, and affairs of the Borrower and each of its direct and indirect subsidiaries, and has the requisite knowledge, experience, and authority to provide the certifications set forth herein.
In connection with the preparation and delivery of this Certificate, the undersigned has made such investigations and inquiries as she has deemed necessary and appropriate, including without limitation a thorough review of the financial condition, assets (both tangible and intangible), liabilities (including contingent liabilities), cash flows, capital structure, and business prospects of the Borrower and its subsidiaries on a consolidated basis. Such review encompassed, among other things, an examination of the audited consolidated financial statements of the Borrower for the fiscal year ended December 31, 2022, as audited by Braddock & Saylor LLP, the unaudited interim consolidated financial statements for the six-month period ended June 30, 2023, the Borrower's internal financial projections and business plans, the terms and conditions of all outstanding indebtedness of the Borrower and its subsidiaries, and the terms and conditions of the Transactions (as defined below).
The certifications set forth in this Certificate are made after giving pro forma effect to each of the following (collectively, the "Transactions"):
(a) the incurrence of $120,000,000 in mezzanine indebtedness under the Mezzanine Credit Agreement;
(b) the payment of all fees, costs, and expenses incurred in connection with the Transactions, totaling approximately $4,562,500, consisting of:
(i) a commitment fee of $2,400,000 (2.0% of the aggregate mezzanine term loan commitment) payable to Ridgeline Mezzanine Capital Fund III, LP;
(ii) a financial advisory fee of $900,000 payable to Zynvaro Thornton Advisory Group, LLC, financial advisor to the Borrower;
(iii) legal fees and disbursements of $675,000 payable to Calderwood & Harkness LLP, counsel to the Borrower, in connection with the negotiation, documentation, and closing of the Transactions;
(iv) reimbursement of legal fees and disbursements in the amount of $450,000 payable to Archer Blackwell & Moss LLP, counsel to the Mezzanine Lender, as required under Section 10.04 of the Mezzanine Credit Agreement; and
(v) a Senior Agent amendment fee of $137,500 payable to Whitmore National Bank, N.A., in its capacity as Administrative Agent and Collateral Agent under the Senior Credit Agreement, in connection with the execution and delivery of Amendment No. 3 to the Senior Credit Agreement;
(c) the application of net mezzanine proceeds (after payment of the fees and expenses described in clause (b) above) to fund capital expenditures for the fleet expansion program, terminal facility buildout initiative, and technology upgrade program, in each case as described in the capital expenditure budget approved by the Board of Directors of the Borrower and delivered to the Mezzanine Lender pursuant to Section 6.01(e) of the Mezzanine Credit Agreement; and
(d) all other transactions contemplated by the Mezzanine Credit Agreement and the related transaction documents (including the Mezzanine Guaranty Agreement, the Mezzanine Pledge and Security Agreement, the Parent Equity Pledge Agreement, the Warrant Agreement, the Intercreditor Agreement, and Amendment No. 3 to the Senior Credit Agreement) to occur on or before the Closing Date.
SECTION 1: DEFINITIONS
For purposes of this Certificate, the following terms shall have the meanings set forth below:
"Fair Value" means the amount at which the assets (both tangible and intangible), in their entirety, of the Borrower and its subsidiaries on a consolidated basis would change hands between a willing buyer and a willing seller, within a commercially reasonable period of time, each having reasonable knowledge of the relevant facts, with neither being under any compulsion to act. For purposes of this definition, "tangible assets" include, without limitation, fleet vehicles, trailers, rolling stock, equipment, terminal facilities, real property, accounts receivable, inventory, cash and cash equivalents, and other personal and real property. "Intangible assets" include, without limitation, customer contracts and relationships, intellectual property, trade names and trademarks, technology and software, workforce in place, permits and licenses, and the going-concern value of the business as an operating enterprise. Fair Value is determined on a going-concern basis and does not assume a forced sale, liquidation, or distressed disposition of such assets.
"Fair Saleable Value" means the amount that could be obtained by an independent willing seller from an independent willing buyer if the assets of the Borrower and its subsidiaries on a consolidated basis were sold with reasonable promptness in an arm's-length transaction under present conditions for the sale of comparable business enterprises insofar as such conditions can reasonably be evaluated, as such conditions may reasonably be expected to exist. Fair Saleable Value contemplates a sale of the business as a going concern, but takes into account the market conditions, time period, and circumstances under which such a sale might reasonably be consummated. Fair Saleable Value may differ from Fair Value to the extent that market conditions, time constraints, or other factors would cause the realizable value to be higher or lower than Fair Value.
"Total Liabilities" means the total amount of all liabilities (including contingent liabilities, whether matured, unmatured, liquidated, unliquidated, disputed, or undisputed) of the Borrower and its subsidiaries on a consolidated basis, as would be reflected on a consolidated balance sheet of the Borrower prepared in accordance with generally accepted accounting principles in the United States ("GAAP") consistently applied, after giving pro forma effect to the Transactions. Total Liabilities include, without limitation, the following indebtedness outstanding on the Closing Date after giving effect to the Transactions:
(a) Senior Secured Term Loan B: $275,000,000 principal amount outstanding, bearing interest at SOFR plus 375 basis points per annum (with a SOFR floor of 75 basis points), maturing November 15, 2026, incurred under the Amended and Restated Credit Agreement, dated as of April 7, 2022 (originally dated as of November 15, 2019, as amended and restated on April 7, 2022, and as further amended by Amendment No. 1 dated October 12, 2022, Amendment No. 2 dated March 3, 2023, and Amendment No. 3 dated September 29, 2023), among the Borrower, Whitmore National Bank, N.A. as Administrative Agent and Collateral Agent, and the lenders party thereto from time to time (as so amended and restated, the "Senior Credit Agreement");
(b) Senior Secured Revolving Credit Facility: $12,000,000 principal amount drawn as of the Closing Date (of $50,000,000 aggregate committed revolving loan commitments), bearing interest at SOFR plus 350 basis points per annum (with a SOFR floor of 50 basis points), maturing November 15, 2025, incurred under the Senior Credit Agreement;
(c) Mezzanine Term Loan: $120,000,000 principal amount outstanding, bearing interest at a blended rate of 1,100 basis points per annum, consisting of 850 basis points of current-pay cash interest and 250 basis points of payment-in-kind ("PIK") interest that accrues and is capitalized to the outstanding principal balance quarterly, maturing September 29, 2029, incurred under the Mezzanine Credit Agreement; and
(d) Total Funded Debt at Closing: $407,000,000, representing the sum of the amounts set forth in clauses (a), (b), and (c) above.
Total Liabilities also include all trade payables, accrued expenses, deferred revenue, pension and post-retirement benefit obligations, operating lease liabilities, tax liabilities (whether current or deferred), intercompany liabilities (to the extent not eliminated in consolidation), and all other obligations of whatever nature that would be required to be reflected as liabilities on a consolidated balance sheet prepared in accordance with GAAP.
"Stated Liabilities" means the stated or determinable amount of all liabilities as recorded on the books and records of the Borrower and its subsidiaries as of the Closing Date, determined in accordance with GAAP. For the avoidance of doubt, Stated Liabilities include only those liabilities that are reflected or required to be reflected on the Borrower's consolidated balance sheet as of the Closing Date and do not include contingent liabilities that are not required to be recognized as liabilities under GAAP, except to the extent that such contingent liabilities have been so recorded.
"Transactions" means, collectively, (a) the entering into of the Mezzanine Credit Agreement and each of the ancillary and related documents executed and delivered in connection therewith (including the Mezzanine Guaranty Agreement, the Mezzanine Pledge and Security Agreement, the Parent Equity Pledge Agreement, the Warrant Agreement granting to the Mezzanine Lender warrants representing 3.0% of the fully-diluted equity of the Borrower, the Intercreditor Agreement among Whitmore National Bank, N.A. and the Mezzanine Lender, and Amendment No. 3 to the Senior Credit Agreement), (b) the borrowing of the $120,000,000 mezzanine term loan on the Closing Date, (c) the issuance of warrants to the Mezzanine Lender representing 3.0% of the fully-diluted equity of the Borrower, exercisable at a nominal strike price, (d) the payment of all fees, costs, and expenses related to the foregoing, and (e) the application of the net proceeds of the mezzanine term loan for the purposes described in Section 6.10 of the Mezzanine Credit Agreement.
SECTION 2: FINANCIAL OVERVIEW AND BASIS FOR CERTIFICATIONS
In making the certifications set forth in Section 3 below, the undersigned has reviewed and considered, among other things, the following key financial data and information relating to the Borrower and its subsidiaries on a consolidated basis:
Historical Financial Performance
(a) FY2022 Revenue: $687,000,000, as reflected in the audited consolidated financial statements of the Borrower for the fiscal year ended December 31, 2022, prepared in accordance with GAAP and audited by Braddock & Saylor LLP, independent registered public accounting firm. Braddock & Saylor LLP issued an unqualified audit opinion with respect to such financial statements, dated March 17, 2023.
(b) FY2022 Adjusted EBITDA: $98,400,000, representing an Adjusted EBITDA margin of approximately 14.3%. Adjusted EBITDA is calculated in accordance with the definition set forth in Section 1.01 of the Mezzanine Credit Agreement and reflects adjustments for non-cash stock-based compensation expense, sponsor management fees, acquisition-related costs, non-recurring restructuring charges, and other items expressly permitted under the definition thereof.
(c) LTM Adjusted EBITDA as of June 30, 2023: $108,600,000, as reported in the Compliance Certificate delivered pursuant to Section 6.02 of the Senior Credit Agreement for the fiscal quarter ended June 30, 2023. The increase from FY2022 Adjusted EBITDA reflects continued organic growth in the Borrower's LTL and intermodal freight operations, improved pricing discipline, and operational efficiency gains realized during the first half of fiscal year 2023.
Pro Forma Capital Structure at Closing
Leverage and Coverage Metrics
(a) Total Leverage at Closing: 3.75x, calculated as Total Funded Debt of $407,000,000 divided by LTM Adjusted EBITDA of $108,600,000. This ratio is within the Maximum Total Leverage Ratio of 4.25x required under Section 7.11(a) of the Mezzanine Credit Agreement. The Mezzanine Credit Agreement provides for step-downs in the Maximum Total Leverage Ratio to 4.00x beginning with the fiscal quarter ending September 30, 2024, and to 3.75x beginning with the fiscal quarter ending September 30, 2025.
(b) Senior Leverage at Closing: 2.64x, calculated as Senior Funded Debt of $287,000,000 (consisting of $275,000,000 Senior Secured Term Loan B and $12,000,000 drawn under the Senior Secured Revolving Credit Facility) divided by LTM Adjusted EBITDA of $108,600,000.
(c) Minimum Liquidity: As of the Closing Date, after giving pro forma effect to the Transactions, the Borrower has unrestricted cash and cash equivalents plus available and undrawn revolving credit facility commitments (net of any outstanding letters of credit) in excess of $15,000,000, which is the minimum liquidity threshold required under Section 7.11(c) of the Mezzanine Credit Agreement. Specifically, as of the Closing Date, the Borrower has approximately $38,000,000 of undrawn revolving credit facility capacity ($50,000,000 of aggregate revolving commitments less $12,000,000 drawn), in addition to unrestricted cash and cash equivalents on the balance sheet.
Ownership and Sponsorship
The Borrower's equity sponsor is Cascade Ridge Capital Partners, LLC, a Delaware limited liability company, which holds a 78.4% ownership interest in the Borrower through its wholly-owned subsidiary, Cascade Ridge SLG Holdings, LLC. Stonefield Logistics Group Inc. was acquired by Cascade Ridge Capital Partners, LLC in November 2019 for an enterprise value of approximately $520,000,000 in a management-led leveraged buyout transaction. The remaining equity interests are held by management and certain co-investors. Since the acquisition, the Borrower has grown its revenue from $512,000,000 in FY2019 to $687,000,000 in FY2022, representing a compound annual growth rate of approximately 10.3%.
Subsidiary Guarantors
The Borrower's direct and indirect wholly-owned subsidiaries — Stonefield Intermodal Services, Inc., a Delaware corporation, Stonefield Fleet Management, LLC, a Delaware limited liability company, and Stonefield Freight Brokerage, Inc., a Delaware corporation — are each guarantors under both the Senior Credit Agreement and the Mezzanine Credit Agreement. Each such subsidiary is an integral part of the Borrower's consolidated operations and contributes meaningfully to the consolidated revenues and Adjusted EBITDA of the Borrower and its subsidiaries taken as a whole. The certifications in this Certificate are made with respect to the Borrower and its subsidiaries on a consolidated basis, inclusive of each such subsidiary guarantor.
SECTION 3: SOLVENCY CERTIFICATIONS
Based upon the foregoing, and after giving pro forma effect to the Transactions as of the Closing Date, the undersigned hereby certifies, in her capacity as Chief Financial Officer of the Borrower and not in her individual capacity, as follows:
Section 3(a): Balance Sheet Solvency — Fair Value Exceeds Total Liabilities
As of the Closing Date, after giving pro forma effect to the Transactions, the Fair Value of the assets of the Borrower and its subsidiaries, taken as a whole on a consolidated basis, exceeds the Total Liabilities (including subordinated, contingent, matured, unmatured, liquidated, and unliquidated liabilities) of the Borrower and its subsidiaries, taken as a whole on a consolidated basis.
In reaching this conclusion, the undersigned has considered the Fair Value of the Borrower's tangible assets, including without limitation its fleet of owned and leased vehicles, trailers, and rolling stock, its terminal facilities and related real property interests across the Borrower's national network, equipment, accounts receivable, inventory, and cash and cash equivalents. The undersigned has also considered the Fair Value of the Borrower's intangible assets, including without limitation the value of the Borrower's long-standing customer contracts and customer relationships, intellectual property (including proprietary logistics software and technology platforms), trade names and brand recognition in the LTL and intermodal freight sector, workforce in place, permits and operating authorities, and the going-concern value of the Borrower's consolidated business as an operating enterprise. The undersigned has evaluated these assets in relation to the $407,000,000 of total funded debt outstanding as of the Closing Date (after giving pro forma effect to the Transactions) and all other liabilities of the Borrower and its subsidiaries on a consolidated basis, and has concluded that the Fair Value of such assets exceeds the Total Liabilities of the Borrower and its subsidiaries. In this regard, the undersigned notes that the enterprise value at which the Borrower was acquired by Cascade Ridge Capital Partners, LLC in November 2019 was approximately $520,000,000, and that the Borrower's business has grown substantially since that date. The undersigned believes that the current Fair Value of the Borrower's assets, taken as a whole, materially exceeds the Total Liabilities of the Borrower and its subsidiaries after giving effect to the Transactions.
Section 3(b): Fair Saleable Value Exceeds Stated Liabilities
As of the Closing Date, after giving pro forma effect to the Transactions, the Fair Saleable Value of the assets of the Borrower and its subsidiaries, taken as a whole on a consolidated basis, is greater than the total amount of the Stated Liabilities of the Borrower and its subsidiaries, taken as a whole on a consolidated basis.
The Borrower's operating business in the national less-than-truckload and intermodal freight sector is a well-established, revenue-generating enterprise with a diversified customer base spanning multiple end-markets, a national terminal network, a modern fleet, and a growing technology platform that enhances operational efficiency and customer service. Such a business generates significant enterprise value in excess of the book value of its individual assets. The undersigned has considered the conditions under which the assets of the Borrower and its subsidiaries could be sold with reasonable promptness in an arm's-length transaction, including the active M&A market for transportation and logistics businesses, the availability of financing for potential acquirers, and the Borrower's competitive positioning within its industry. Based on these considerations, the undersigned has concluded that the Fair Saleable Value of the Borrower's assets, taken as a whole on a consolidated basis, exceeds the total amount of the Stated Liabilities of the Borrower and its subsidiaries.
Section 3(c): Adequate Capital — Not Unreasonably Small Capital
As of the Closing Date, after giving pro forma effect to the Transactions, the Borrower and its subsidiaries, taken as a whole on a consolidated basis, have sufficient capital to carry on their businesses and all businesses in which they are about to engage, and do not have unreasonably small capital with which to conduct the businesses in which they are engaged or are about to engage.
In reaching this conclusion, the undersigned has considered, among other things, the following factors:
(a) The capital expenditure program to be funded in whole or in part with the net proceeds of the mezzanine term loan — encompassing the fleet expansion initiative (addition of approximately 350 new Class 8 tractors and 600 new trailers), the terminal facility buildout (expansion or construction of terminals in six metropolitan service areas), and the technology upgrade program (deployment of next-generation transportation management system and real-time shipment visibility platform) — is projected to generate incremental revenue and Adjusted EBITDA sufficient to service the additional indebtedness incurred under the Mezzanine Credit Agreement. Management's internal projections, which the undersigned believes are prepared on a reasonable basis in light of historical performance and current market conditions, indicate that the capital expenditure program will contribute incremental annualized Adjusted EBITDA of approximately $18,000,000 to $24,000,000 upon full deployment, which is expected to occur by the end of fiscal year 2025.
(b) The Maximum Capital Expenditures covenant under Section 7.11(d) of the Mezzanine Credit Agreement permits capital expenditures of up to $85,000,000 per fiscal year, with the ability to carry forward up to 25% of any unused annual capital expenditure allowance to the immediately succeeding fiscal year. This covenant provides the Borrower with adequate flexibility to execute its capital expenditure program while maintaining compliance with the financial covenants contained in the Mezzanine Credit Agreement.
(c) The Borrower maintains access to $38,000,000 of undrawn revolving credit facility capacity ($50,000,000 of aggregate revolving commitments less $12,000,000 currently drawn) under the Senior Credit Agreement, in addition to the net proceeds of the mezzanine term loan, providing significant additional liquidity to fund working capital needs, seasonal fluctuations in operating cash flow, and other general corporate purposes. The Borrower's unrestricted cash on hand, combined with such undrawn revolving capacity, substantially exceeds the $15,000,000 minimum liquidity requirement under the Mezzanine Credit Agreement.
(d) The Borrower's business generates substantial operating cash flow, with LTM Adjusted EBITDA of $108,600,000 as of June 30, 2023. After deducting estimated annual cash interest expense on total funded debt, estimated maintenance capital expenditures, estimated cash taxes, and estimated working capital requirements, the Borrower is expected to generate meaningful free cash flow available to fund operations, growth investments, and debt service.
Based on the foregoing, the undersigned has concluded that the Borrower and its subsidiaries, taken as a whole on a consolidated basis, have adequate capital and do not have unreasonably small capital with which to conduct their businesses.
Section 3(d): Ability to Pay Debts as They Become Due
As of the Closing Date, after giving pro forma effect to the Transactions, the Borrower and its subsidiaries, taken as a whole on a consolidated basis, are able to pay their debts and other liabilities (including trade payables, contractual obligations, and contingent obligations) as they become due in the ordinary course of business.
In reaching this conclusion, the undersigned has considered the projected cash flows of the Borrower and its subsidiaries on a consolidated basis, taking into account the following:
(a) Debt service requirements, including (i) quarterly cash interest payments on the $120,000,000 mezzanine term loan at 850 basis points per annum (approximately $2,550,000 per quarter), (ii) PIK interest accrual on the mezzanine term loan at 250 basis points per annum (approximately $750,000 per quarter, which accrues and capitalizes to principal and does not require current cash payment), (iii) quarterly cash interest payments on the $275,000,000 Senior Secured Term Loan B at SOFR plus 375 basis points per annum (approximately $6,187,500 per quarter at current SOFR rates), (iv) quarterly amortization payments on the Senior Secured Term Loan B (at 1.0% per annum of the original principal amount, or approximately $687,500 per quarter), and (v) interest on the drawn portion of the Senior Secured Revolving Credit Facility;
(b) Planned capital expenditures, including the fleet expansion, terminal facility buildout, and technology upgrade program, which are expected to be funded primarily with the net proceeds of the mezzanine term loan and internally generated cash flow;
(c) Working capital needs, including trade payables, payroll obligations, fuel costs, insurance premiums, equipment maintenance costs, and other operating expenses that arise in the ordinary course of the Borrower's business; and
(d) Other fixed charges, including operating lease payments, insurance premiums, and tax obligations.
The Minimum Fixed Charge Coverage Ratio of 1.10x required under Section 7.11(b) of the Mezzanine Credit Agreement is expected to be satisfied for each measurement period during the term of the Mezzanine Credit Agreement, based on the Borrower's projected cash flows and the undersigned's analysis of the Borrower's ability to generate Adjusted EBITDA sufficient to cover its fixed charges. This analysis indicates that the Borrower's consolidated cash flows are expected to be sufficient to meet all of the Borrower's and its subsidiaries' obligations as they become due in the ordinary course of business.
The first interest payment date under the Mezzanine Credit Agreement is December 29, 2023 (representing the initial quarterly interest period from the Closing Date through December 29, 2023). The undersigned expects that the Borrower will have sufficient cash on hand and available liquidity to make such interest payment when due, taking into account the Borrower's anticipated operating cash flows and available revolving credit facility capacity during such period.
Section 3(e): No Intent to Hinder, Delay, or Defraud Creditors
The Borrower has not incurred and does not intend to incur debts beyond its ability to pay as such debts mature. The Borrower has not entered into the Transactions, and is not entering into the Transactions, with the actual intent to hinder, delay, or defraud any person to which the Borrower or any of its subsidiaries is, or may become, indebted. The incurrence of the mezzanine term loan indebtedness and the consummation of the other Transactions have been undertaken in good faith and for legitimate business purposes, including the funding of capital expenditure initiatives expected to enhance the Borrower's revenue-generating capacity, operational efficiency, and competitive positioning within the LTL and intermodal freight industry.
SECTION 4: QUALIFICATIONS AND ASSUMPTIONS
The certifications set forth in Section 3 of this Certificate are subject to the following qualifications and assumptions:
(a) The certifications are based upon financial information available to the undersigned as of the Closing Date, and upon estimates and assumptions that the undersigned believes to be reasonable as of such date, in light of current conditions and the Borrower's historical financial performance. The undersigned recognizes that forward-looking estimates and assumptions are inherently subject to uncertainty, and that actual results may differ from the estimates and assumptions underlying the certifications contained herein.
(b) The undersigned is not expressing an opinion as to the value of any specific asset of the Borrower or any of its subsidiaries, or as to the price at which any individual asset or group of assets could be sold in a particular transaction. The certifications herein relate to the Fair Value and Fair Saleable Value of the assets of the Borrower and its subsidiaries taken as a whole on a consolidated basis, and not to the value of any particular asset or class of assets.
(c) The certifications contained herein do not constitute a guaranty or assurance that the Borrower will remain solvent, or that any particular financial result will be achieved, at any future date, and are given solely as of the Closing Date after giving pro forma effect to the Transactions. No representation or warranty is made as to the future financial condition or solvency of the Borrower or any of its subsidiaries at any time after the Closing Date.
(d) The undersigned has assumed that the audited consolidated financial statements of the Borrower for the fiscal year ended December 31, 2022 (prepared by Braddock & Saylor LLP, independent registered public accounting firm) and the unaudited interim consolidated financial statements of the Borrower for the six-month period ended June 30, 2023, in each case as delivered to the Mezzanine Lender pursuant to the Mezzanine Credit Agreement, are accurate in all material respects and present fairly, in all material respects, the consolidated financial position and results of operations of the Borrower and its subsidiaries for the periods covered thereby, in conformity with GAAP (subject, in the case of the unaudited interim financial statements, to normal year-end audit adjustments and the absence of footnote disclosures).
(e) The undersigned has relied upon the Borrower's internal financial projections, forecasts, and business plans, which the undersigned believes are prepared on a reasonable basis and reflect the Borrower's good faith estimates and assumptions regarding future operating performance, revenue growth, capital expenditure requirements, debt service obligations, working capital needs, and other factors relevant to the certifications herein. However, the undersigned acknowledges that such projections, forecasts, and business plans are inherently uncertain, are based on numerous assumptions (including assumptions regarding general economic conditions, industry trends, competitive dynamics, fuel costs, labor markets, and regulatory developments), and are not a guarantee of future performance. No assurance can be given that the actual results of the Borrower's operations will conform to such projections, forecasts, or business plans.
(f) The undersigned has assumed that the representations and warranties made by the Borrower and each guarantor in the Mezzanine Credit Agreement and the related transaction documents are true and correct in all material respects as of the Closing Date, and that no Default or Event of Default exists under the Mezzanine Credit Agreement or the Senior Credit Agreement as of the Closing Date.
SECTION 5: RELIANCE AND USE
This Certificate is delivered for the sole benefit of Ridgeline Mezzanine Capital Fund III, LP, in its capacity as Mezzanine Lender under the Mezzanine Credit Agreement, and may be relied upon by such party in connection with the funding of the mezzanine term loan on the Closing Date. The Mezzanine Lender is entitled to rely on this Certificate in making its decision to fund the mezzanine term loan, and in connection with the satisfaction of the conditions precedent to funding set forth in Article IV of the Mezzanine Credit Agreement.
This Certificate may not be relied upon by any other person or entity, or for any other purpose, without the prior written consent of the Borrower. Without limiting the foregoing, this Certificate is not intended for the benefit of, and shall not be relied upon by, any trade creditor, bondholder, shareholder, equity holder, or any other creditor or stakeholder of the Borrower or any of its affiliates, and the undersigned expressly disclaims any duty or obligation to any such person in connection with the certifications contained herein. This Certificate does not create any fiduciary duty, attorney-client relationship, or other professional relationship between the undersigned and the Mezzanine Lender or any other party.
IN WITNESS WHEREOF, the undersigned has executed and delivered this Solvency Certificate as of the date first written above.
STONEFIELD LOGISTICS GROUP INC.
By: ________
Name: Janet R. Prescott
Title: Chief Financial Officer
Date: September 29, 2023
Facility | Principal Amount | Rate | Maturity
Senior Secured Term Loan B | $275,000,000 | SOFR + 375 bps | November 15, 2026
Senior Secured Revolving Credit Facility (drawn) | $12,000,000 | SOFR + 350 bps | November 15, 2025
Mezzanine Term Loan | $120,000,000 | 850 bps cash / 250 bps PIK | September 29, 2029
Total Funded Debt | $407,000,000

SOLVENCY CERTIFICATE

RECITALS AND INTRODUCTORY STATEMENTS

SECTION 1: DEFINITIONS

SECTION 2: FINANCIAL OVERVIEW AND BASIS FOR CERTIFICATIONS

SECTION 3: SOLVENCY CERTIFICATIONS

SECTION 4: QUALIFICATIONS AND ASSUMPTIONS

SECTION 5: RELIANCE AND USE

STONEFIELD LOGISTICS GROUP INC.

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