Attachment: Conditions Comparison Chart — Meridian (04.09.2026).xlsx
Richard,
I hope you're doing well. I wanted to reach out to begin coordinating on several important alignment issues between the financing documents and the purchase agreement in connection with Solara Digital Infrastructure LP's and Solara Digital Acquisition Holdings LLC's proposed acquisition of Meridian Cloud Solutions Inc.
As you know, we are representing Solara on the $200,000,000 Senior Secured Term Loan Facility being arranged by Brindoval National Bank, N.A. to finance the acquisition. We are currently in active negotiations with Brindoval's counsel, Broadwick & Thayer LLP (Catherine Hartwell and James Okoro), on the term sheet and commitment letter. We received Brindoval's counter-markup of the term sheet on April 4, and we circulated our second markup on Tuesday. We have a negotiation call scheduled for tomorrow, April 10. Given that we are targeting execution of the term sheet and commitment letter on April 18, I want to flag several areas where the financing documents and the purchase agreement need to be closely aligned and begin coordinating on those points now.
**SunGard Closing Conditions — Alignment with the Purchase Agreement**
Brindoval's draft commitment letter includes customary "SunGard" limited conditionality provisions, meaning the conditions to the lender's obligation to fund under the commitment letter are intended to be narrower than the conditions to closing under the purchase agreement. The governing principle here is critical: any condition that must be satisfied for lender funding should be a subset of, or otherwise backstopped by, the conditions to closing in the purchase agreement, so that Solara is never in a position where it is obligated to close the acquisition but the financing cannot fund. There are several specific areas I'd like to coordinate on:
- **Material Adverse Effect Definition.** The commitment letter MAE definition must be no broader than the MAE definition in the purchase agreement. We are pushing to narrow Brindoval's proposed MAE definition and will share the negotiated version as it develops. Could you confirm the MAE definition in the current draft purchase agreement with Kerrigan Ross & Associates (Danielle Musgrave) and share a copy so we can cross-reference? This is one of the most important alignment points.
- **Specified Representations.** The commitment letter will contain a limited set of "specified representations" — representations that must be true as a condition to funding. These should correspond to the "bring-down" representations in the purchase agreement that are conditions to Solara's obligation to close the acquisition. Please confirm which representations in the purchase agreement are "fundamental" or "specified" reps that survive at a higher bring-down standard (i.e., true in all respects or true in all material respects, as opposed to the broader set that is subject to a general MAE qualification).
- **No Default / No Event of Default.** The commitment letter will condition funding on the absence of defaults under the credit agreement. This is standard, but we need to ensure that no obligation in the purchase agreement could independently trigger a default under the credit agreement — for example, through any interim operating covenants or pre-closing obligations imposed on Solara.
- **Absence of Bankruptcy or Insolvency of the Target.** Both documents should treat this condition consistently. Please confirm how the purchase agreement addresses the target's solvency as a condition to closing.
**Limited Conditionality / Certain Funds**
Solara's position — and Priya can confirm this reflects the client's strong preference — is to negotiate the commitment letter to be as close to a "certain funds" structure as possible. Once the commitment letter is signed, Brindoval should be obligated to fund on the closing date so long as the limited, specified conditions are met, with no additional outs, market flex, or diligence conditions.
To support this structure, the purchase agreement needs a robust **financing cooperation covenant** from the seller and target (Meridian and its shareholders, including Ashford Ventures Partners LLC). This is critical to the financing, and its absence or inadequacy could give Brindoval grounds to resist certain funds protections. The cooperation covenant should, at a minimum, require Meridian to:
1. Make management available for lender meetings, presentations, and due diligence sessions; 2. Provide customary financial information, including audited financial statements for FY 2025 and FY 2024 (from Whitfield & Sable LLP) as well as interim quarterly and monthly unaudited financials; 3. Provide the lender and its advisors with reasonable access to Meridian's properties, books, and records for due diligence purposes; 4. Assist with collateral-related deliverables, including existing lien payoff letters and UCC termination statements for existing filings; 5. Execute and deliver ancillary documents reasonably required in connection with the financing at or prior to closing (e.g., pledge agreements, IP security agreements, officer's certificates); and 6. Provide customary authorization letters for the lender group.
Please confirm that the current draft purchase agreement includes a financing cooperation covenant covering these items, and if not, I'd recommend proposing one for inclusion in your next markup to Kerrigan Ross. The due diligence period under the financing is expected to run from approximately April 21 through May 30, so seller cooperation will be needed promptly after commitment letter execution.
**Reverse Termination Fee / Financing Failure**
I also want to flag the question of what happens if the financing fails — specifically, if Brindoval fails to fund despite satisfaction of the commitment letter conditions. Does the purchase agreement include a reverse termination fee payable by Solara (or by Solara Digital Partners Fund IV, LP) in the event the acquisition does not close due to a failure to obtain financing? If so, could you share the amount and the conditions under which it becomes payable? This bears on how we structure certain provisions in the commitment letter and the credit agreement, including the commitment letter's expiration mechanics.
On that note, the commitment letter as currently drafted has an expiration date of **June 2, 2026** (45 days from the expected April 18 execution), which predates the targeted closing and funding date of **June 30, 2026**. We will negotiate extension mechanics in the commitment letter to bridge this gap, but the purchase agreement's outside date should be set with this timeline in mind. We want to ensure there is no mismatch that leaves Solara exposed.
**Timing Coordination**
For your reference, the key financing timeline milestones are as follows:
- **April 18, 2026:** Target execution of term sheet and commitment letter - **April 21 – May 30, 2026:** Due diligence period - **May 22, 2026:** Target date for execution-ready credit agreement draft - **June 16, 2026:** Target signing of credit agreement - **June 30, 2026:** Target closing and funding
Could you share the current anticipated timeline on the acquisition side? Specifically, I'd like to understand the expected date for signing the purchase agreement (whether this is structured as a stock purchase agreement or merger agreement), any regulatory approvals that may be required, and the outside date for closing. The credit agreement will need to be signed no later than June 16, and the funds flow will need to be coordinated for a simultaneous close on June 30.
**Comparison Chart**
I've attached a summary comparison chart mapping the commitment letter conditions precedent to funding (as proposed by Brindoval in its initial draft) against the anticipated purchase agreement closing conditions. The chart is organized in four columns: (1) Commitment Letter Condition, (2) Corresponding Purchase Agreement Condition, (3) Alignment Status (Aligned / Misaligned / TBD), and (4) Notes and Action Items. I've filled in as much as I can from the financing side, but a number of the purchase agreement columns remain open. Could you review the chart, fill in the purchase agreement column where you have the relevant information, and flag any misalignments or gaps? This will be a useful working document as we move toward commitment letter execution.
**Tremblay Equity Rollover**
One additional item: the sources and uses contemplate Jason Tremblay (Meridian's founder and CEO) rolling over approximately $20,000,000 of his sale proceeds into equity of Solara Digital Acquisition Holdings LLC, the Borrower. The credit agreement will need to address this rollover equity in several respects — most importantly, ensuring that the rollover equity counts toward the equity contribution for purposes of the lender's sources and uses analysis and is not treated as "indebtedness" or a "restricted payment" under the credit agreement's covenants. Please confirm that the rollover mechanics in the purchase agreement are consistent with this treatment, and share the relevant provisions so we can ensure alignment.
**Key Financial Metrics (for Reference)**
Since you are handling the acquisition side, I wanted to provide the key deal metrics that inform the financing structure for ease of reference:
- Enterprise value: $315,000,000 - Total sources: $330,000,000 ($200,000,000 term loan + $130,000,000 equity contribution from Fund IV) - Total uses: $330,000,000 ($315,000,000 purchase price + $12,000,000 estimated transaction fees and expenses + $3,000,000 cash to balance sheet) - Closing leverage: approximately 10.70x Debt / LTM Adjusted EBITDA and 3.21x Debt / ARR (based on Meridian LTM 12/31/2025 Adjusted EBITDA of $18,700,000 and ARR of $62,400,000)
**Next Steps**
I'd suggest we schedule a call early next week — ideally Monday or Tuesday — to discuss the above in more detail. By then we will have had the April 10 negotiation call with Brindoval and Broadwick & Thayer and should have a better sense of where the commitment letter negotiations stand. In the meantime, if you could share the latest draft of the purchase agreement — or at minimum the conditions to closing, financing cooperation covenant, and MAE definition sections — that would allow us to begin the cross-referencing exercise on our end.
Philip Hartmann is available for a joint call with Priya Vasudeva to discuss any issues that require client input, and we're happy to coordinate schedules for that as well.
Please don't hesitate to call me in the interim if you have any questions or if anything above warrants a quick discussion before next week.
Best regards,
Lisa Morrow Calderwood & Harkness LLP One Liberty Plaza, 44th Floor New York, NY 10006 T: (212) 554-7182 E: lmorrow@calderwoodharkness.com
Matter Ref: 1041-00002 / CL-081273