1041-00002 · Solara Digital Infrastructure LP · Internal Memoranda & Analysis

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PRIVILEGED AND CONFIDENTIAL — ATTORNEY WORK PRODUCT

MEMORANDUM

PRIVILEGED AND CONFIDENTIAL — ATTORNEY-CLIENT PRIVILEGE / ATTORNEY WORK PRODUCT DOCTRINE This memorandum has been prepared by counsel at Calderwood & Harkness LLP and is protected by the attorney-client privilege and the attorney work product doctrine. It is intended solely for the use of the addressee and should not be disclosed, distributed, or disseminated to any third party without the prior written consent of Calderwood & Harkness LLP.

TO: Philip Hartmann, Partner, Banking & Finance

FROM: Lisa Morrow, Lead Associate, Banking & Finance (with assistance from Marcus Leung, Working Associate)

DATE: March 27, 2026

RE: Collateral Package — Key Considerations for SaaS Businesses; $200,000,000 Senior Secured Term Loan Facility — Solara Digital Acquisition Holdings LLC (Acquisition of Meridian Cloud Solutions Inc.)

Matter No.: 1041-00002

Client No.: CL-081273

I. Executive Summary

The purpose of this memorandum is to analyze the key collateral considerations specific to the Software-as-a-Service ("SaaS") business model in connection with the proposed $200,000,000 Senior Secured Term Loan Facility (the "Facility") to be provided by Brindoval National Bank, N.A. ("Brindoval"), acting as Lead Arranger and Administrative Agent, to Solara Digital Acquisition Holdings LLC (the "Borrower"), a newly formed Delaware limited liability company and wholly owned subsidiary of Solara Digital Infrastructure Fund IV LP ("Fund IV" or the "Sponsor"). The Facility will finance the Sponsor's acquisition (the "Acquisition") of 100% of the outstanding equity interests of Meridian Cloud Solutions Inc. ("Meridian" or the "Target"), a Delaware corporation headquartered at 450 Technology Parkway, Suite 800, Austin, Texas 78759.

Meridian is a cloud-native SaaS platform providing portfolio analytics, risk reporting, investor reporting, and data aggregation tools to mid-market asset managers, registered investment advisers ("RIAs"), and family offices. Meridian's recurring revenue model and software-centric asset base present collateral considerations that differ materially from those encountered in traditional leveraged financings involving hard-asset-intensive borrowers. These differences are the focus of this memorandum.

The Acquisition is structured at a $315,000,000 enterprise value, financed through the $200,000,000 term loan and a $130,000,000 equity contribution from Fund IV (inclusive of a $20,000,000 equity rollover by Jason Tremblay, Meridian's founder and current Chief Executive Officer). At the transaction's closing leverage, the Facility represents approximately 10.70x Debt-to-LTM Adjusted EBITDA ($200,000,000 ÷ $18,700,000) and approximately 3.21x Debt-to-ARR ($200,000,000 ÷ $62,400,000, based on annualized recurring revenue for the trailing twelve months ended December 31, 2025). The relatively high EBITDA leverage is characteristic of sponsor-backed SaaS acquisitions where the lender group relies heavily on the predictability and stickiness of recurring subscription revenue and the growth trajectory of the platform, in addition to traditional cash flow metrics.

Pursuant to the draft term sheet received from Brindoval on March 21, 2026 (the "Draft Term Sheet"), the collateral package for the Facility requires the Borrower, Meridian (post-closing), and each Guarantor to grant a first-priority perfected security interest in substantially all of their respective assets, including without limitation: (i) all equity interests in subsidiaries, (ii) all intellectual property, (iii) all accounts receivable, (iv) all equipment, and (v) all deposit accounts and securities accounts. The Guarantors under the proposed structure include: (a) Solara Digital Infrastructure LP (as sponsor guarantor, on a limited recourse basis), (b) Meridian Cloud Solutions Inc. (post-closing as a wholly owned subsidiary of the Borrower), and (c) each of Meridian's material domestic subsidiaries (to be identified during diligence).

This memorandum identifies and analyzes five categories of collateral-specific issues that require careful attention in the context of the Meridian financing:

1. intellectual property security interests — perfection requirements for software copyrights, patents, trademarks, and trade secrets, and the unique diligence considerations presented by a SaaS company's IP portfolio;

2. Deposit account control agreements ("DACAs") — the requirement for perfection by "control" under UCC Article 9, the practical timing challenges of DACA execution, and the negotiation of post-closing periods;

3. Equity pledges — the pledge hierarchy for the Borrower and its subsidiaries, the 65% limitation on foreign subsidiary equity pledges, and perfection mechanics for LLC membership interests and corporate stock;

4. Customer contract assignment restrictions — the interaction between anti-assignment clauses in SaaS subscription agreements and UCC § 9-406, and the practical implications for collateral enforcement; and

5. Excluded assets — customary collateral exclusions applicable to SaaS businesses, including immaterial intellectual property, anti-assignment license agreements, and other asset categories where the cost of perfection outweighs the benefit to the lender group.

The recommendations set forth in this memorandum are designed to inform the first markup of the Draft Term Sheet, which is due to be delivered to Brindoval's counsel, Broadwick & Thayer LLP (lead partner Catherine Hartwell; senior associate James Okoro), no later than March 28, 2026. The recommendations will also guide the eventual negotiation of the definitive credit agreement, security agreement, and related collateral documents.

II. Intellectual Property Security Interests

A. Overview of Meridian's IP Portfolio

Meridian's core asset — and the principal driver of its enterprise value — is its proprietary cloud-native software platform. The platform is built on a modern technology stack and delivers portfolio analytics, risk reporting, investor reporting, and data aggregation functionality to its customer base through a web-based interface and API integrations. The software source code (and compiled object code) constitutes the single most valuable component of Meridian's intellectual property portfolio. Unlike manufacturing or real estate-intensive businesses, where tangible assets comprise the bulk of collateral value, the vast majority of Meridian's asset value resides in intangible intellectual property. This reality places a premium on ensuring that the security interest in Meridian's IP is properly granted, attached, and perfected.

Meridian currently employs approximately 310 full-time equivalents ("FTEs"), with a significant proportion of those resources dedicated to engineering and product development under the direction of Rohan Deshpande, Meridian's Chief Technology Officer. The ongoing development of the platform — including new modules, feature enhancements, and integrations — generates after-acquired intellectual property that must also be captured within the security interest through appropriate security agreement drafting.

The following categories of intellectual property are expected to be included in the collateral package:

Copyright in Software Source Code and Object Code. Meridian's platform source code is subject to federal copyright protection as a literary work under the Copyright Act (17 U.S.C. § 101 et seq.). Both the source code (the human-readable programming instructions) and the object code (the machine-readable compiled version) are copyrightable. Copyright protection attaches automatically upon creation and fixation in a tangible medium of expression, without the need for registration. However, as discussed below, the perfection requirements for registered and unregistered copyrights differ materially.

Patents. SaaS companies vary widely in the extent of their patent portfolios. Some SaaS companies, particularly those with novel algorithmic or data-processing innovations, hold meaningful utility patent portfolios. Others rely primarily on trade secret protection for their technology and have limited or no issued patents. We do not yet have information regarding whether Meridian has filed or been issued any utility or design patents, and this is a key diligence item that must be confirmed with Meridian's management team. It is not uncommon for mid-market SaaS companies of Meridian's size to have few or no patents.

Trademarks. Meridian is expected to hold trademark rights in the "Meridian" and "Meridian Cloud Solutions" brand names, associated logos, product names for individual modules or features, and related trade dress. These may include both federally registered marks (with the USPTO) and common-law marks arising from use in commerce. Trademarks are integral to customer recognition and the commercial identity of the platform.

Trade Secrets. Meridian's proprietary algorithms, analytics methodologies, customer data schemas, internal processes, and other confidential business information constitute trade secrets under both federal law (the Defend Trade Secrets Act, 18 U.S.C. § 1836 et seq.) and Texas state law (the Texas Uniform Trade Secrets Act, Tex. Civ. Prac. & Rem. Code § 134A.001 et seq.). Trade secrets may represent a substantial portion of the platform's competitive differentiation. Maintaining the confidentiality of this information is essential to preserving its legal status as a protectable trade secret.

Domain Names. Meridian's internet domain names (including its primary commercial domain name, likely "meridiancloud.com" or similar) are valuable intangible assets. Domain names are generally classified as general intangibles under UCC Article 9.

B. Perfection Requirements — Software/Copyright

The perfection of security interests in copyrights — and particularly in software copyrights — requires a dual-track approach under the federal copyright system and the Uniform Commercial Code.

Under the Copyright Act (17 U.S.C. § 205(a)), a transfer of copyright ownership, including the grant of a security interest, may be recorded in the U.S. Copyright Office. Recordation constitutes constructive notice of the facts stated in the recorded document under 17 U.S.C. § 205(c), provided certain conditions are met (including that the work is specifically identified in the recorded document). Pursuant to the preemption doctrine articulated by the Second Circuit in In re Peregrine Entertainment, Ltd., 116 B.R. 194 (C.D. Cal. 1990), and subsequently followed by the majority of courts addressing the issue, the Copyright Act preempts UCC Article 9 with respect to the perfection of security interests in registered copyrights. In other words, a UCC-1 financing statement filed with a state secretary of state is, standing alone, insufficient to perfect a security interest in a registered copyright as against subsequent bona fide purchasers or transferees. Recordation with the U.S. Copyright Office is required.

For unregistered copyrights — which, as noted above, include the vast majority of copyrightable software code that has not been the subject of a federal copyright registration — perfection is achieved by filing a UCC-1 financing statement with the Delaware Secretary of State, as Meridian's jurisdiction of organization. The Copyright Act preemption applies only to copyrights that have been registered with the Copyright Office; it does not extend to unregistered works. Meridian's Delaware Secretary of State file number is 6038472, and the UCC-1 financing statement should be filed under the exact legal name of Meridian as it appears in the records of the Delaware Secretary of State.

Recommendation: We recommend the following approach to copyright collateral perfection:

(i) Conduct a comprehensive search of the U.S. Copyright Office records to identify all registered copyrights held by Meridian Cloud Solutions Inc. and any of its subsidiaries;

(ii) For all registered copyrights identified, prepare and file copyright security agreements with the U.S. Copyright Office, specifically identifying each registered work by its registration number;

(iii) File UCC-1 financing statements with the Delaware Secretary of State covering all copyrights (both registered and unregistered), as well as all other general intangibles; the UCC filing provides a belt-and-suspenders approach for registered copyrights and constitutes the primary perfection mechanism for unregistered copyrights; and

(iv) Include in the security agreement a broad grant of security interest covering all copyrights and copyrightable works, whether now owned or hereafter acquired, whether registered or unregistered, together with all related rights, claims, and causes of action.

Practical Consideration: In our experience, many SaaS companies — particularly mid-market companies that have grown rapidly and have not had occasion to enforce their copyrights in litigation — do not register copyrights in their software source code with the U.S. Copyright Office. Copyright registration is not required for protection to exist, though it is a prerequisite to bringing a federal infringement action and to obtaining statutory damages and attorneys' fees. It is therefore possible that Meridian has limited or no copyright registrations. This must be confirmed during the intellectual property diligence process. If Meridian has no registered copyrights, the perfection analysis simplifies considerably (UCC filing alone would suffice), but we should be aware that the absence of registration could complicate enforcement of copyright rights in the event of infringement by third parties.

Source Code Escrow Arrangements: An additional consideration in the SaaS context is whether Meridian maintains source code escrow agreements with any of its customers. In some SaaS arrangements — particularly those involving enterprise customers or customers in regulated industries — the customer requires the SaaS vendor to deposit its source code with an independent escrow agent, with release triggers based on vendor bankruptcy, cessation of business, or material breach. If such escrow arrangements exist, we must determine (a) whether the escrow interest (i.e., the vendor's interest in the escrowed source code) is pledgeable as collateral, and (b) whether the escrow agreements contain restrictions on assignment or encumbrance of the vendor's interest. This is a diligence item to be raised with Meridian's CTO.

C. Perfection Requirements — Patents

Security interests in issued patents and pending patent applications are perfected by recording the security interest with the United States Patent and Trademark Office ("USPTO") through the Patent Assignment Recordation system. The USPTO recording should be supplemented by a UCC-1 financing statement filed with the Delaware Secretary of State. While there is some judicial disagreement regarding whether the Patent Act fully preempts UCC Article 9 for perfection purposes (in contrast to the more developed preemption doctrine under the Copyright Act), the prevailing practice in leveraged finance transactions is to record the patent security interest with the USPTO as a matter of prudence and to file the UCC-1 as a supplemental measure.

Recommendation: If Meridian holds any issued patents or pending patent applications, we should:

(i) Conduct a comprehensive USPTO search to identify all issued patents and pending patent applications held by Meridian and its subsidiaries;

(ii) Prepare and file patent security agreements with the USPTO, specifically identifying each patent and application by its patent number or application number;

(iii) File corresponding UCC-1 financing statements with the Delaware Secretary of State; and

(iv) Include in the security agreement provisions requiring Meridian to notify the Administrative Agent of, and to grant a security interest in, any after-acquired patents or patent applications filed during the term of the Facility.

As noted above, it is possible that Meridian does not hold any patents. This must be confirmed as a threshold diligence matter.

D. Perfection Requirements — Trademarks

Security interests in registered trademarks and service marks are perfected by recording the security interest with the USPTO through the Trademark Assignment Recordation system. As with patents, the USPTO filing should be supplemented by a UCC-1 financing statement filed with the Delaware Secretary of State. While the Lanham Act does not contain an express preemption provision equivalent to § 205 of the Copyright Act, the prevailing practice is to record trademark security interests with the USPTO to provide constructive notice and to protect the secured party against subsequent bona fide purchasers and assignees.

Practical Note Regarding Naked Licenses: The grant of a security interest in trademarks, and particularly the potential enforcement of such security interest through foreclosure, must be carefully drafted to avoid creating a "naked license" that could result in the abandonment or cancellation of the mark. A naked license arises when a trademark owner licenses the use of its mark without retaining or exercising adequate quality control over the goods or services offered under the mark. If the security agreement or the enforcement provisions are drafted in a manner that permits the secured party (upon foreclosure) to license or use the mark without maintaining the quality standards associated with the mark, courts may hold that the mark has been abandoned. To mitigate this risk, the trademark security agreement should include provisions that (a) preserve the grantor's obligation to maintain quality control over goods and services bearing the mark during the term of the security interest, and (b) require the secured party, upon foreclosure, to maintain or license the mark in a manner consistent with the quality standards historically associated with the mark.

Recommendation: We recommend the following approach:

(i) Conduct a comprehensive search of the USPTO's Trademark Electronic Search System ("TESS") database to identify all registered trademarks, service marks, and pending applications held by Meridian and its subsidiaries;

(ii) Prepare and file trademark security agreements with the USPTO for all registered marks, specifically identifying each mark by its registration number;

(iii) File UCC-1 financing statements with the Delaware Secretary of State covering all trademarks and service marks (both registered and unregistered), including common-law marks, together with all associated goodwill;

(iv) Ensure that the trademark security agreement includes appropriate quality control provisions to avoid a "naked license" argument; and

(v) Include in the security agreement a broad grant covering all trademarks and service marks, whether now owned or hereafter acquired, whether registered or unregistered, together with all associated goodwill.

E. Trade Secrets and Know-How

Trade secrets and proprietary know-how are classified as "general intangibles" under UCC Article 9. A security interest in general intangibles is perfected by filing a UCC-1 financing statement with the Delaware Secretary of State. There is no federal registration system for trade secrets, and thus no federal-level filing requirement for perfection of a security interest in trade secret assets.

Key Concern: The principal concern with respect to trade secret collateral is the tension between the secured party's need for access to the collateral upon enforcement and the legal requirement that trade secrets must be maintained in confidence to retain their protected status. If the secured party, upon foreclosure, obtains access to Meridian's trade secrets and disseminates or fails to adequately protect them, the trade secret status of the information may be destroyed. This would not only diminish the value of the collateral but could also expose the parties to claims for misappropriation or breach of confidentiality obligations.

Recommendation: The security agreement should include specific provisions governing trade secret collateral, including:

(i) An acknowledgment by the Administrative Agent that the trade secrets constitute confidential information of the grantor;

(ii) A covenant by the Administrative Agent (and any transferee in an enforcement action) to maintain the confidentiality of the trade secret information and to take reasonable measures to prevent unauthorized disclosure;

(iii) Restrictions on access to trade secret collateral, providing that the Administrative Agent may access such information only in connection with a bona fide enforcement action and subject to confidentiality obligations; and

(iv) Provisions requiring that any sale or transfer of trade secret collateral in connection with enforcement be subject to confidentiality agreements binding on the purchaser or transferee.

F. IP-Related Diligence Items

To complete our analysis and to prepare the IP-related collateral documents, we will need to obtain the following information from Meridian. We recommend that these requests be communicated through Meridian's CFO, Maggie Cho, and CTO, Rohan Deshpande, with coordination through Alderton Paige LLP (Richard Fontaine), the Sponsor's acquisition counsel, who is conducting IP diligence in connection with the Acquisition itself:

(a) A complete schedule of all registered and unregistered intellectual property, including all issued patents and pending patent applications, all registered copyrights, all registered trademarks and service marks and pending applications, all material domain names, and a summary description of material trade secrets and proprietary know-how;

(b) All existing intellectual property license agreements, both inbound (licenses from third parties to Meridian) and outbound (licenses from Meridian to customers, partners, or other third parties);

(c) A comprehensive report on all open-source software used in or incorporated into the Meridian platform, including identification of each open-source component, the applicable license type (e.g., MIT, Apache 2.0, GPL, LGPL, AGPL), and any compliance or attribution obligations;

(d) Information regarding any intellectual property-related litigation, disputes, or claims (pending, threatened, or resolved within the past five years), including any patent infringement, copyright infringement, trademark infringement, or trade secret misappropriation claims;

(e) Copies of all standard-form employee and independent contractor intellectual property assignment agreements, together with confirmation of whether all current and former employees and contractors who contributed to the development of the platform have executed such agreements; and

(f) Information regarding any source code escrow arrangements with customers.

We note that Richard Fontaine at Alderton Paige is conducting IP diligence in connection with the Acquisition, and we should coordinate our collateral-related IP diligence requests with their broader diligence effort to avoid duplication and ensure efficiency.

III. Deposit Account Control Agreements (DACAs)

A. UCC Article 9 Perfection Framework

Under Article 9 of the Uniform Commercial Code, a deposit account is defined as "a demand, time, savings, passbook, or similar account maintained with a bank" (UCC § 9-102(a)(29)). When a deposit account serves as original collateral (as opposed to proceeds of other collateral), perfection of a security interest in the deposit account can only be achieved through "control." A UCC-1 financing statement filed with the Secretary of State is not a permissible method of perfection for a deposit account as original collateral. UCC § 9-312(b)(1) expressly provides that a security interest in a deposit account may be perfected only by control under UCC § 9-104.

Under UCC § 9-104, a secured party has "control" of a deposit account in one of three circumstances:

(i) The secured party is the bank. If the bank maintaining the deposit account is itself the secured party, control exists automatically by virtue of the banking relationship. In this transaction, if Brindoval National Bank, N.A. (as Administrative Agent) maintains any of Meridian's or the Borrower's deposit accounts, perfection by control would be achieved automatically with respect to those accounts. However, even in this circumstance, execution of a DACA is advisable to clarify the secured party's enforcement rights and the bank's obligations;

(ii) A control agreement (DACA). The most common method in leveraged finance transactions, a DACA is a three-party agreement among the depositor (the account holder), the depository bank, and the secured party. Under the DACA, the depositary bank agrees to comply with instructions originated by the secured party directing the disposition of funds in the deposit account, without further consent from the depositor; and

(iii) The secured party becomes the bank's customer. The secured party becomes a customer of the bank with respect to the deposit account. This method is rarely used in practice.

DACAs are the standard method for achieving control over deposit accounts in leveraged finance transactions. Each DACA must be individually negotiated and executed with the depository bank maintaining the account.

B. Application to Meridian

In order to perfect the security interest in Meridian's deposit accounts (and, post-closing, in the Borrower's deposit accounts), DACAs will need to be executed for each deposit account maintained by Meridian and the Borrower. This requires a threshold identification of all deposit accounts and all depository institutions with which Meridian maintains banking relationships.

We should request from Maggie Cho, Meridian's CFO, a complete list of all deposit accounts maintained by Meridian and its subsidiaries, including for each account: (a) the account name and account number, (b) the depository institution, (c) the purpose of the account (operating, payroll, tax withholding, benefits, sweep, escrow, etc.), (d) the approximate average balance, and (e) any existing control agreements, pledges, or restrictions on the account.

DACAs will need to be executed between Meridian (as depositor), each depository bank, and Brindoval National Bank, N.A. (as Administrative Agent). A typical mid-market SaaS company of Meridian's size and operational complexity may maintain accounts at multiple financial institutions — often including a primary operating bank for revenue deposits and disbursements, a separate payroll processing bank, one or more sweep or investment accounts, and potentially tax withholding or escrow accounts. Each depository relationship will require a separate DACA negotiation.

If Brindoval National Bank, N.A. also serves as a depository bank for any Meridian accounts (either currently or post-closing), automatic perfection by control may apply under UCC § 9-104(a)(1), since the secured party is the bank. However, we still recommend that a formal DACA (or equivalent agreement) be executed to establish the Administrative Agent's enforcement rights and to provide clarity regarding the disposition of funds in the event of a default.

C. Timing and Practical Considerations

In our experience, DACAs are frequently the single most time-consuming closing deliverable in leveraged acquisition financings. The delay arises from several factors:

• Depository banks typically insist on using their own form control agreements, which often differ materially from the form preferred by the secured party (the Administrative Agent);

• Depository banks may require internal credit or legal approval before executing a DACA, and the approval timelines vary significantly by institution;

• Negotiations over key DACA terms — including the timing and conditions for the activation of "springing" control (i.e., the point at which the Administrative Agent may direct the disposition of funds without the depositor's consent), the depository bank's indemnification rights, and the depositor's right to continue using the account until a default occurs — can be protracted; and

• In transactions involving acquisitions, the target company's existing banking relationships may not have previously been subject to DACAs, and the depository banks may be unfamiliar with the process or reluctant to accommodate.

Recommendation: We recommend the following approach to manage the DACA process:

(i) Identify all deposit accounts and depository institutions as early as possible in the diligence process — no later than the commencement of the formal due diligence period on April 21, 2026;

(ii) Initiate outreach to depository banks and begin DACA negotiations well in advance of the targeted June 30, 2026 closing date, to allow adequate time for negotiation, internal bank approvals, and execution;

(iii) In the term sheet markup, negotiate a post-closing period of 60 to 90 days following the closing date for the delivery of DACAs with respect to existing deposit accounts that cannot be controlled by closing — this is a customary accommodation in leveraged finance transactions and should be raised as a term sheet point in our March 28 markup; and

(iv) For the Borrower's newly established accounts (which will be opened at or around closing to receive the loan proceeds and to fund the Acquisition), coordinate the DACA execution simultaneously with the account opening so that control is established at closing.

D. Securities Accounts and Investment Property

If Meridian or the Borrower holds any securities accounts (as defined in UCC § 8-501) or investment property, a control agreement with the relevant securities intermediary (the broker-dealer or bank acting as custodian) will be required to perfect the security interest in such assets. Under UCC §§ 9-106 and 8-106, control of a securities account is established by entering into a three-party control agreement with the securities intermediary, or by the secured party becoming the entitlement holder with respect to the account.

We should determine during diligence whether any of Meridian's operating cash is held in money market funds, sweep accounts, or other short-term investment vehicles that may be characterized as securities accounts (rather than deposit accounts) under the UCC. The distinction is significant because the perfection requirements and the applicable control agreement forms differ between deposit accounts and securities accounts. If Meridian's primary operating accounts include an automated sweep feature that moves excess cash balances into a money market fund or similar investment vehicle, the swept funds may reside in a securities account maintained by a securities intermediary, and a separate control agreement with that intermediary will be required.

E. Excluded Accounts

It is customary in leveraged finance transactions to negotiate exclusions from the DACA requirement for certain categories of deposit accounts where the administrative burden and cost of obtaining a DACA outweigh the incremental collateral value to the lender. We recommend negotiating the following DACA exclusions, to be reflected in the credit agreement's definitions of "Collateral" and "Excluded Assets":

• Payroll and benefits accounts — accounts maintained solely for the purpose of funding payroll, employee benefits, and related disbursements, up to a specified threshold amount (e.g., an aggregate balance not to exceed the amount of one payroll cycle);

• Tax withholding accounts — accounts maintained solely for the purpose of holding funds for the payment of federal, state, and local tax withholding obligations;

• Escrow accounts required by third-party contracts — accounts maintained in escrow pursuant to obligations under customer contracts, vendor agreements, or other third-party arrangements, where the escrow terms may prohibit the grant of a security interest;

• Zero-balance accounts — accounts that are designed to have a zero balance at the end of each business day, with all funds swept to a controlled operating account;

• De minimis accounts — accounts with an average daily balance below a specified de minimis threshold, which we recommend setting at $100,000 per account (the specific threshold will be a point of negotiation with Brindoval).

These exclusions should be expressly defined in the credit agreement and cross-referenced in the security agreement and the collateral schedules.

IV. Equity Pledges

A. Term Sheet Requirements

The Draft Term Sheet requires the grant of a first-priority perfected security interest in: (a) 100% of the equity interests of each direct and indirect domestic subsidiary of the Borrower; and (b) 65% of the voting equity interests (and 100% of the non-voting equity interests) of each first-tier foreign subsidiary. This formulation is standard in sponsor-backed leveraged finance transactions and reflects the customary approach to equity pledge collateral.

The 65% limitation on foreign subsidiary equity pledges is driven by United States federal income tax considerations. Under Section 956 of the Internal Revenue Code (26 U.S.C. § 956), if a United States shareholder of a "controlled foreign corporation" (a "CFC") pledges more than 66⅔% of the CFC's voting stock to secure an obligation, the pledge may be treated as an investment by the CFC in United States property, resulting in a deemed repatriation of the CFC's undistributed earnings and profits as taxable income to the U.S. shareholder. By limiting the pledge to 65% of the voting stock — below the 66⅔% threshold — the parties avoid triggering this adverse tax consequence. It is worth noting that while recent amendments to the tax code under the Tax Cuts and Jobs Act of 2017 have modified the mechanics of CFC taxation, the 65% pledge limitation remains the market standard practice in leveraged finance transactions.

B. Application to Transaction Structure

The equity pledge hierarchy for this transaction is as follows:

Level 1 — Fund IV's Interest in the Borrower. Fund IV holds a 100% membership interest in Solara Digital Acquisition Holdings LLC (the Borrower). We should confirm with the Sponsor whether the Draft Term Sheet requires a pledge of Fund IV's equity interest in the Borrower as part of the collateral package, or whether the pledge structure begins at the Borrower level and extends only downstream. If a pledge at this level is required, the pledge will be made by Fund IV, and the security interest will be perfected by filing a UCC-1 financing statement with the Delaware Secretary of State (since the Borrower is a Delaware LLC). This pledge may also implicate Fund IV's limited partnership agreement and any restrictions on the disposition of Fund IV's investment interests.

Level 2 — Borrower's Interest in Meridian. Following the closing of the Acquisition, the Borrower will hold 100% of the outstanding equity interests (common stock) of Meridian Cloud Solutions Inc. This equity interest will be pledged by the Borrower to the Administrative Agent. The pledge of Meridian stock is a critical component of the collateral package, as it represents the secured party's direct access to the enterprise value of Meridian and its subsidiaries. Perfection is discussed in Section IV.C below.

Level 3 — Meridian's Interests in Domestic Subsidiaries. Meridian is expected to hold 100% of the equity interests in each of its material domestic subsidiaries. We do not yet have a complete subsidiary organizational chart, and this is a priority diligence item. Each domestic subsidiary's equity interest held by Meridian will be pledged to the Administrative Agent.

Level 4 — Meridian's Interests in Foreign Subsidiaries (if any). If Meridian has any first-tier foreign subsidiaries, 65% of the voting equity interests (and 100% of the non-voting equity interests) in each such foreign subsidiary will be pledged by Meridian. We do not yet know whether Meridian has any foreign subsidiaries or foreign operations, and this must be confirmed during diligence.

Equity Rollover Consideration. Jason Tremblay, Meridian's founder and CEO, is rolling over $20,000,000 in equity into the Acquisition vehicle. We should confirm with the Sponsor and its acquisition counsel the precise structure of the rollover — specifically, whether Tremblay's rollover equity will be a separate class of membership interest in the Borrower (e.g., a Class B interest), whether it will be pari passu with Fund IV's equity or subordinate to it, and how the rollover interest interacts with the equity pledge. In most sponsor-backed acquisitions, the management rollover equity is subordinate to the pledged interest (i.e., the pledge of the Borrower's equity in Meridian takes priority over the economic interests of the rollover equity holders in the Borrower), but the specific intercreditor and waterfall mechanics should be confirmed and documented.

C. Perfection of Equity Pledges

The perfection requirements for equity pledges depend on the nature of the equity interest being pledged:

LLC Membership Interests (Borrower and any LLC Subsidiaries). Membership interests in a limited liability company are classified as "general intangibles" under UCC Article 9. A security interest in a general intangible is perfected by filing a UCC-1 financing statement with the office of the Secretary of State in the jurisdiction in which the pledgor is organized. For the Borrower's membership interest in Meridian (where the pledgor is the Borrower, a Delaware LLC, DE SOS File No. 7531209), the UCC-1 filing would be made with the Delaware Secretary of State. If any Meridian subsidiaries are organized as LLCs, the same analysis applies, with the filing jurisdiction determined by Meridian's state of organization (Delaware, DE SOS File No. 6038472).

Corporate Stock (Meridian and any Corporate Subsidiaries). Shares of stock in a corporation may be either certificated or uncertificated. The perfection analysis differs based on this distinction:

• Certificated shares: If Meridian's shares are evidenced by physical stock certificates, the security interest is perfected by the secured party's possession of the stock certificates, either endorsed in blank or accompanied by duly executed stock powers. See UCC § 9-313(a). This method provides the highest degree of protection and is the preferred method for certificated securities. A supplemental UCC-1 filing with the Delaware Secretary of State is also advisable.

• Uncertificated shares: If Meridian's shares are uncertificated, perfection can be achieved by (a) "control" under UCC § 8-106(c) (by having the issuer register the secured party as the registered owner, or by having the issuer agree to comply with the secured party's instructions without the further consent of the registered owner), or (b) by filing a UCC-1 financing statement. Control provides a superior perfection method (UCC § 9-328(1) — a security interest perfected by control has priority over a security interest perfected by filing).

Recommendation: We should confirm with Meridian's existing counsel (Kerrigan Ross or applicable corporate counsel) whether Meridian's shares of common stock are certificated or uncertificated. If certificated, original stock certificates and executed blank stock powers will be required as closing deliverables and should be included in the closing checklist. If uncertificated, we will need to arrange for the issuer (Meridian) to enter into a control agreement or to register the pledge on its books.

Foreign Subsidiary Equity (if applicable). If Meridian holds equity interests in any foreign subsidiaries, we will need to analyze the local law perfection requirements in the relevant foreign jurisdiction in addition to the UCC filing. Many foreign jurisdictions require registration of the security interest with a local governmental authority, notarization or apostille of the pledge agreement, or other local-law formalities. We should engage local counsel in any applicable foreign jurisdiction once the subsidiary structure is confirmed.

D. Organizational Document Considerations

A comprehensive review of the organizational documents of both the Borrower and Meridian is necessary to identify any provisions that may restrict or complicate the equity pledge:

Meridian's Certificate of Incorporation and Bylaws. We should review Meridian's certificate of incorporation, bylaws, and any stockholders' agreement for provisions restricting the transfer or encumbrance of Meridian stock, including rights of first refusal, consent requirements, tag-along rights, drag-along rights, co-sale rights, or contractual prohibitions on pledging. Such provisions are common in privately held technology companies, particularly where there are minority stockholders or investor-rights agreements from prior financing rounds. To the extent any such restrictions exist, they will need to be waived (by the requisite vote of stockholders or the board of directors) or amended in connection with the Acquisition to permit the grant of the equity pledge and potential enforcement through foreclosure.

Borrower's LLC Agreement. The Borrower is a newly formed Delaware LLC created specifically for purposes of this Acquisition. Its LLC agreement should be drafted from inception to permit the equity pledge in favor of the Administrative Agent, to provide for the Administrative Agent's rights as a transferee upon foreclosure, and to eliminate any transfer restrictions that could impede enforcement. We should coordinate with Alderton Paige on the drafting of the Borrower's LLC agreement to ensure that the collateral-related provisions are incorporated from the outset.

V. Customer Contract Assignment Restrictions

A. Nature of the Issue

SaaS businesses derive substantially all of their revenue from recurring subscription agreements with customers. Meridian's $62.4 million in annualized recurring revenue ("ARR") for the trailing twelve months ended December 31, 2025, is generated from subscription contracts under which customers pay periodic fees (typically monthly or annually) for access to Meridian's cloud-based platform. These customer contracts represent the economic lifeblood of the business, and the accounts receivable arising from them are a critical component of the collateral package.

A significant number of SaaS customer agreements contain anti-assignment clauses that restrict the assignment of the contract — or the account receivable arising under the contract — without the customer's prior written consent. Such clauses are particularly prevalent in agreements with enterprise customers, financial institutions, and regulated entities, where the customer has a strong interest in controlling the identity and capabilities of its service provider. Anti-assignment clauses in SaaS customer agreements may take various forms, ranging from a blanket prohibition on assignment without consent, to more nuanced provisions that distinguish between assignment of the contract (i.e., the vendor's obligations and rights) and assignment of the right to payment.

The interaction between anti-assignment clauses in customer contracts and the secured party's interest in the accounts receivable arising from those contracts is governed by UCC Article 9, which provides important protections for secured parties.

B. UCC § 9-406 and the Override of Anti-Assignment Clauses

Under UCC § 9-406(d), a term in an agreement between an account debtor (the customer) and an assignor (Meridian) that restricts the assignment of, or the creation of a security interest in, an "account" (as defined in UCC § 9-102(a)(2)) is ineffective to the extent that it purports to prevent or restrict the creation, attachment, or perfection of a security interest in the account. In other words, anti-assignment clauses in customer contracts are overridden by operation of law for purposes of creating and perfecting a security interest in the right to payment (the account receivable) arising under the contract.

This means that the security interest in Meridian's accounts receivable arising from customer subscription agreements should be enforceable as against the account debtors (customers) notwithstanding any anti-assignment clauses in the underlying contracts. The Administrative Agent should be able to perfect its security interest in Meridian's receivables by filing a UCC-1 financing statement, and the anti-assignment clauses should not impair the grant or perfection of that security interest.

However, the UCC § 9-406 override is limited in scope. It applies to the right to payment — i.e., the account receivable — but does not override anti-assignment clauses with respect to the full panoply of contractual rights under the customer agreement. In particular, the override does not extend to the assignability of the vendor's performance obligations, the vendor's right to continue providing services under the contract, or other non-payment rights embedded in the customer agreement.

C. Practical Implications for Collateral Enforcement

The distinction between the security interest in the receivable (which is enforceable notwithstanding anti-assignment clauses) and the secured party's ability to step into the vendor's shoes under the customer contract (which may be restricted) has important practical implications in an enforcement scenario.

In the event of a default under the credit agreement and enforcement of the security interest in Meridian's accounts receivable, the Administrative Agent would be entitled to collect the receivables — i.e., to receive the payments owing under the customer contracts. However, the Administrative Agent's ability to assume Meridian's position under the customer contracts, to continue providing the SaaS services, or to assign the customer contracts to a purchaser in connection with a collateral disposition, may be limited by the anti-assignment clauses in the customer agreements. This is primarily a remedies issue rather than a perfection issue, but it directly affects the practical value of the collateral to the lender group. A secured party that can collect receivables but cannot operate the business (or transfer the customer contracts as a going concern) will realize significantly less value from the collateral than one that can do both.

This dynamic is inherent in SaaS collateral packages and is well understood by lender groups active in the technology sector. The value of the collateral in a SaaS financing is largely a function of the ongoing customer relationships and the recurring revenue stream they generate, rather than the liquidation value of the underlying assets. Accordingly, lenders in SaaS financings typically rely on the expectation that enforcement will take the form of a going-concern sale of the business (through foreclosure on the equity pledge) rather than a piecemeal liquidation of individual contract rights.

D. Diligence and Recommendations

Diligence Items:

(i) Request from Meridian a representative sample of customer agreements, including the agreements with the top ten customers by ARR, to review the specific language of any anti-assignment provisions;

(ii) Identify any customer contracts that include change-of-control provisions that may be triggered by the Acquisition itself — such provisions may require customer consent or notification in connection with the change of control of Meridian, and the failure to comply could result in a termination right in favor of the customer; this is both an acquisition diligence issue and a collateral issue, and we should coordinate with Alderton Paige on this point; and

(iii) Confirm with Meridian whether any customer contracts contain provisions that specifically address the grant of security interests or the pledge of receivables.

Recommendations for Term Sheet / Credit Agreement:

(i) Include a customary acknowledgment in the credit agreement (and in the security agreement) that anti-assignment restrictions in customer contracts do not impair the grant, attachment, or perfection of the security interest in the receivables arising under those contracts, consistent with UCC § 9-406;

(ii) Negotiate a collateral exclusion for customer contracts (as distinct from the receivables arising thereunder) only to the extent that the grant of a security interest in the full contract rights (as opposed to the receivable) would result in a breach or termination of the contract and such restriction is not overridden by applicable law — this is a narrow, targeted exclusion designed to avoid a technical breach of anti-assignment clauses while preserving the security interest in the accounts receivable; and

(iii) Consider whether any key customer contracts identified during diligence require affirmative customer consent to the change of control. If so, obtaining such consents should be added to the closing conditions or post-closing obligations, as appropriate.

E. Government Contracts

If Meridian serves any government or quasi-government customers, additional assignment restrictions may apply under federal law. The federal Anti-Assignment Act (41 U.S.C. § 6305) generally prohibits the transfer or assignment of government contracts or any interest therein without the prior approval of the contracting agency. The Assignment of Claims Act (31 U.S.C. § 3727) restricts the assignment of claims against the United States government, subject to certain exceptions for assignments to banks, trust companies, or other financing institutions. If Meridian holds any government contracts, a separate legal analysis of the collateral implications will be required, as the UCC § 9-406 override may not apply to government contracts, and the perfection and enforceability of security interests in receivables arising from government contracts are subject to the specific requirements of federal law.

We should confirm with Meridian whether it is a party to any contracts with federal, state, or local government agencies or with quasi-governmental entities.

VI. Excluded Assets Analysis

A. Overview. Although the Draft Term Sheet calls for a security interest in "substantially all assets" of the Borrower, Meridian, and the Guarantors, it is customary in leveraged finance transactions to negotiate express exclusions for certain categories of assets. These exclusions apply where the cost, administrative burden, or legal risk of granting and perfecting a security interest outweighs the incremental collateral value to the lender group. In a SaaS transaction, the excluded assets analysis takes on particular importance because of the prevalence of licensed technology, the centrality of intellectual property, and the role of customer contract rights.

We recommend negotiating the following categories of excluded assets in the credit agreement and security documents. These exclusions are consistent with market practice in comparable sponsor-backed SaaS financings and should be acceptable to Brindoval and its counsel.

B. Immaterial intellectual Property

We recommend defining a category of "Excluded IP" to exclude from the collateral package intellectual property that is immaterial to the business operations of the Borrower, Meridian, and the Guarantors. Examples of immaterial IP that would fall within this exclusion include:

• Abandoned or lapsed trademark registrations that are no longer in use or for which renewal filings have not been made;

• Domain names that are not used in connection with Meridian's core business or products (e.g., defensive or dormant domain registrations);

• Copyrights in marketing materials, press releases, blog posts, or internal training documents that do not relate to the core platform technology; and

• Patents or patent applications that have been abandoned, allowed to lapse, or that cover technology no longer used in the platform.

The exclusion should be carefully drafted to ensure that all intellectual property that is material to the core SaaS platform and product offerings remains squarely within the collateral package. The boundary between "material" and "immaterial" IP should be defined with sufficient specificity to avoid ambiguity.

Recommendation: We propose an express exclusion for intellectual property with a fair market value below a specified threshold — for example, $250,000 individually or in the aggregate for a related group of assets — subject to the Administrative Agent's right to request inclusion of any excluded IP asset if it subsequently becomes material to the business. This approach provides administrative relief while preserving the lender's ability to capture IP that increases in value over time. The specific threshold will be a point of negotiation with Brindoval.

C. License Agreements with Anti-Assignment Clauses

Certain of Meridian's inbound license agreements — including third-party software licenses, technology licenses, and data provider agreements — may contain anti-assignment or anti-encumbrance provisions that would be breached if Meridian grants a security interest in the license rights. This issue is distinct from the customer contract anti-assignment analysis discussed in Section V, as it concerns inbound licenses (where Meridian is the licensee) rather than outbound contracts (where Meridian is the vendor).

The UCC addresses this issue in § 9-408, which provides that a term in a license agreement prohibiting the creation of a security interest in the licensee's rights under the license is ineffective insofar as it prevents the attachment of the security interest. In other words, the security interest can attach to the license rights notwithstanding the anti-assignment clause. However, § 9-408 critically provides that the security interest created in this manner does not give the secured party any enforcement rights that would violate the anti-assignment clause. The practical result is that the security interest attaches to the license rights (and would thus have some effect in bankruptcy, for example), but the secured party cannot exercise remedies with respect to the license — such as transferring or sublicensing the license to a third-party purchaser — without the consent of the licensor, unless the anti-assignment clause is waived or otherwise overridden.

This creates a collateral gap: the security interest exists but is effectively unenforceable against the licensor without its consent. Attempting to enforce the security interest in a manner that violates the anti-assignment clause could trigger a breach or termination of the license, which in turn could deprive Meridian (or a successor to Meridian's business) of access to critical third-party technology.

Recommendation: We recommend the following approach:

(i) Exclude from the collateral any inbound license agreement to the extent — and only to the extent — that the grant of a security interest therein would result in a breach or termination of such license under its terms and applicable law does not override such restriction. This is a narrowly tailored "springing" exclusion: once the restriction is eliminated (whether by licensor consent, amendment of the license, or a change in applicable law), the license rights automatically become part of the collateral without further action;

(ii) The security agreement should include an express provision confirming the springing nature of the exclusion and the automatic inclusion of previously excluded license rights upon the elimination of the restriction;

(iii) The credit agreement should include a covenant requiring Meridian to use commercially reasonable efforts to obtain any necessary licensor consents to the grant of a security interest, where doing so would not result in material cost or disruption to the business; and

(iv) For licenses that are critical to the operation of the platform, consider seeking licensor consent to the security interest as a closing condition or post-closing deliverable.

Diligence Item: Request from Meridian (via Rohan Deshpande, CTO) a complete list of all inbound third-party license agreements, together with copies of the relevant agreements, so that we can identify those containing anti-assignment or anti-encumbrance provisions. Of particular focus will be:

• Third-party cloud infrastructure agreements (e.g., Ridgeway Industries, Crestline Systems, Aldermere Technologies, or similar IaaS/PaaS providers) — these agreements typically contain restrictions on the assignment or encumbrance of the customer's rights, though the specific terms vary by provider;

• Third-party data feeds and data provider agreements — Meridian's portfolio analytics and data aggregation functionality may depend on data feeds from third-party providers, whose license agreements may restrict assignment or encumbrance;

• Third-party software components embedded in or integrated with the Meridian platform — including any proprietary components licensed from third parties and incorporated into the platform architecture; and

• Open-source software licenses — while open-source licenses are generally permissive with respect to use, modification, and distribution, certain copyleft licenses (such as GPL, LGPL, and AGPL) impose conditions on the distribution or commercial exploitation of derivative works that may have collateral implications. We should review Meridian's open-source usage and assess whether any open-source license obligations could affect the secured party's ability to dispose of the platform software upon enforcement.

D. Other Customary Exclusions

In addition to the IP-specific and license-specific exclusions described above, we recommend negotiating the following customary excluded asset categories:

Leasehold Interests. Leasehold interests in real property where the landlord's consent to collateral assignment has not been obtained. If Meridian leases its office space at 450 Technology Parkway, Suite 800, Austin, Texas (as we expect is the case), the lease agreement may prohibit the tenant from assigning or encumbering its leasehold interest without the landlord's consent. Granting a security interest in the leasehold without consent could constitute a default under the lease. We recommend excluding such leasehold interests from the collateral package unless and until landlord consent is obtained.

Certificate-of-Title Assets. Vehicles and other assets subject to certificate-of-title statutes where the filing of a UCC-1 financing statement is insufficient for perfection and perfection instead requires notation of the security interest on the certificate of title. For a SaaS company like Meridian, the value of such assets is likely to be minimal, and the administrative burden of obtaining title notations outweighs the collateral benefit.

Intent-to-Use Trademark Applications. Intent-to-use ("ITU") trademark applications filed with the USPTO to the extent that granting a security interest before the applicant has made bona fide use of the mark in commerce would invalidate the application under Section 10 of the Lanham Act (15 U.S.C. § 1060). ITU applications may be included in the collateral only after the mark has been used in commerce and a statement of use has been filed with the USPTO.

Letter-of-Credit Rights. Letter-of-credit rights to the extent that a security interest therein cannot be perfected by control. UCC § 9-312(b)(2) provides that a security interest in a letter-of-credit right may be perfected only by control under UCC § 9-107. If the issuing or confirming bank will not enter into a control agreement, the letter-of-credit right should be excluded from the collateral to the extent perfection cannot be achieved.

Restricted Joint Venture and Minority Interests. Equity interests in joint ventures or minority investments where the organizational documents of the joint venture entity prohibit pledging without the consent of the other equity holders and such consent has not been obtained. Forcing a pledge ove

PRIVILEGED AND CONFIDENTIAL — ATTORNEY WORK PRODUCT
MEMORANDUM
PRIVILEGED AND CONFIDENTIAL — ATTORNEY-CLIENT PRIVILEGE / ATTORNEY WORK PRODUCT DOCTRINE This memorandum has been prepared by counsel at Calderwood & Harkness LLP and is protected by the attorney-client privilege and the attorney work product doctrine. It is intended solely for the use of the addressee and should not be disclosed, distributed, or disseminated to any third party without the prior written consent of Calderwood & Harkness LLP.
TO: Philip Hartmann, Partner, Banking & Finance
FROM: Lisa Morrow, Lead Associate, Banking & Finance (with assistance from Marcus Leung, Working Associate)
DATE: March 27, 2026
RE: Collateral Package — Key Considerations for SaaS Businesses; $200,000,000 Senior Secured Term Loan Facility — Solara Digital Acquisition Holdings LLC (Acquisition of Meridian Cloud Solutions Inc.)
Matter No.: 1041-00002
Client No.: CL-081273
I. Executive Summary
The purpose of this memorandum is to analyze the key collateral considerations specific to the Software-as-a-Service ("SaaS") business model in connection with the proposed $200,000,000 Senior Secured Term Loan Facility (the "Facility") to be provided by Brindoval National Bank, N.A. ("Brindoval"), acting as Lead Arranger and Administrative Agent, to Solara Digital Acquisition Holdings LLC (the "Borrower"), a newly formed Delaware limited liability company and wholly owned subsidiary of Solara Digital Infrastructure Fund IV LP ("Fund IV" or the "Sponsor"). The Facility will finance the Sponsor's acquisition (the "Acquisition") of 100% of the outstanding equity interests of Meridian Cloud Solutions Inc. ("Meridian" or the "Target"), a Delaware corporation headquartered at 450 Technology Parkway, Suite 800, Austin, Texas 78759.
Meridian is a cloud-native SaaS platform providing portfolio analytics, risk reporting, investor reporting, and data aggregation tools to mid-market asset managers, registered investment advisers ("RIAs"), and family offices. Meridian's recurring revenue model and software-centric asset base present collateral considerations that differ materially from those encountered in traditional leveraged financings involving hard-asset-intensive borrowers. These differences are the focus of this memorandum.
The Acquisition is structured at a $315,000,000 enterprise value, financed through the $200,000,000 term loan and a $130,000,000 equity contribution from Fund IV (inclusive of a $20,000,000 equity rollover by Jason Tremblay, Meridian's founder and current Chief Executive Officer). At the transaction's closing leverage, the Facility represents approximately 10.70x Debt-to-LTM Adjusted EBITDA ($200,000,000 ÷ $18,700,000) and approximately 3.21x Debt-to-ARR ($200,000,000 ÷ $62,400,000, based on annualized recurring revenue for the trailing twelve months ended December 31, 2025). The relatively high EBITDA leverage is characteristic of sponsor-backed SaaS acquisitions where the lender group relies heavily on the predictability and stickiness of recurring subscription revenue and the growth trajectory of the platform, in addition to traditional cash flow metrics.
Pursuant to the draft term sheet received from Brindoval on March 21, 2026 (the "Draft Term Sheet"), the collateral package for the Facility requires the Borrower, Meridian (post-closing), and each Guarantor to grant a first-priority perfected security interest in substantially all of their respective assets, including without limitation: (i) all equity interests in subsidiaries, (ii) all intellectual property, (iii) all accounts receivable, (iv) all equipment, and (v) all deposit accounts and securities accounts. The Guarantors under the proposed structure include: (a) Solara Digital Infrastructure LP (as sponsor guarantor, on a limited recourse basis), (b) Meridian Cloud Solutions Inc. (post-closing as a wholly owned subsidiary of the Borrower), and (c) each of Meridian's material domestic subsidiaries (to be identified during diligence).
This memorandum identifies and analyzes five categories of collateral-specific issues that require careful attention in the context of the Meridian financing:
1. intellectual property security interests — perfection requirements for software copyrights, patents, trademarks, and trade secrets, and the unique diligence considerations presented by a SaaS company's IP portfolio;
2. Deposit account control agreements ("DACAs") — the requirement for perfection by "control" under UCC Article 9, the practical timing challenges of DACA execution, and the negotiation of post-closing periods;
3. Equity pledges — the pledge hierarchy for the Borrower and its subsidiaries, the 65% limitation on foreign subsidiary equity pledges, and perfection mechanics for LLC membership interests and corporate stock;
4. Customer contract assignment restrictions — the interaction between anti-assignment clauses in SaaS subscription agreements and UCC § 9-406, and the practical implications for collateral enforcement; and
5. Excluded assets — customary collateral exclusions applicable to SaaS businesses, including immaterial intellectual property, anti-assignment license agreements, and other asset categories where the cost of perfection outweighs the benefit to the lender group.
The recommendations set forth in this memorandum are designed to inform the first markup of the Draft Term Sheet, which is due to be delivered to Brindoval's counsel, Broadwick & Thayer LLP (lead partner Catherine Hartwell; senior associate James Okoro), no later than March 28, 2026. The recommendations will also guide the eventual negotiation of the definitive credit agreement, security agreement, and related collateral documents.
II. Intellectual Property Security Interests
A. Overview of Meridian's IP Portfolio
Meridian's core asset — and the principal driver of its enterprise value — is its proprietary cloud-native software platform. The platform is built on a modern technology stack and delivers portfolio analytics, risk reporting, investor reporting, and data aggregation functionality to its customer base through a web-based interface and API integrations. The software source code (and compiled object code) constitutes the single most valuable component of Meridian's intellectual property portfolio. Unlike manufacturing or real estate-intensive businesses, where tangible assets comprise the bulk of collateral value, the vast majority of Meridian's asset value resides in intangible intellectual property. This reality places a premium on ensuring that the security interest in Meridian's IP is properly granted, attached, and perfected.
Meridian currently employs approximately 310 full-time equivalents ("FTEs"), with a significant proportion of those resources dedicated to engineering and product development under the direction of Rohan Deshpande, Meridian's Chief Technology Officer. The ongoing development of the platform — including new modules, feature enhancements, and integrations — generates after-acquired intellectual property that must also be captured within the security interest through appropriate security agreement drafting.
The following categories of intellectual property are expected to be included in the collateral package:
Copyright in Software Source Code and Object Code. Meridian's platform source code is subject to federal copyright protection as a literary work under the Copyright Act (17 U.S.C. § 101 et seq.). Both the source code (the human-readable programming instructions) and the object code (the machine-readable compiled version) are copyrightable. Copyright protection attaches automatically upon creation and fixation in a tangible medium of expression, without the need for registration. However, as discussed below, the perfection requirements for registered and unregistered copyrights differ materially.
Patents. SaaS companies vary widely in the extent of their patent portfolios. Some SaaS companies, particularly those with novel algorithmic or data-processing innovations, hold meaningful utility patent portfolios. Others rely primarily on trade secret protection for their technology and have limited or no issued patents. We do not yet have information regarding whether Meridian has filed or been issued any utility or design patents, and this is a key diligence item that must be confirmed with Meridian's management team. It is not uncommon for mid-market SaaS companies of Meridian's size to have few or no patents.
Trademarks. Meridian is expected to hold trademark rights in the "Meridian" and "Meridian Cloud Solutions" brand names, associated logos, product names for individual modules or features, and related trade dress. These may include both federally registered marks (with the USPTO) and common-law marks arising from use in commerce. Trademarks are integral to customer recognition and the commercial identity of the platform.
Trade Secrets. Meridian's proprietary algorithms, analytics methodologies, customer data schemas, internal processes, and other confidential business information constitute trade secrets under both federal law (the Defend Trade Secrets Act, 18 U.S.C. § 1836 et seq.) and Texas state law (the Texas Uniform Trade Secrets Act, Tex. Civ. Prac. & Rem. Code § 134A.001 et seq.). Trade secrets may represent a substantial portion of the platform's competitive differentiation. Maintaining the confidentiality of this information is essential to preserving its legal status as a protectable trade secret.
Domain Names. Meridian's internet domain names (including its primary commercial domain name, likely "meridiancloud.com" or similar) are valuable intangible assets. Domain names are generally classified as general intangibles under UCC Article 9.
B. Perfection Requirements — Software/Copyright
The perfection of security interests in copyrights — and particularly in software copyrights — requires a dual-track approach under the federal copyright system and the Uniform Commercial Code.
Under the Copyright Act (17 U.S.C. § 205(a)), a transfer of copyright ownership, including the grant of a security interest, may be recorded in the U.S. Copyright Office. Recordation constitutes constructive notice of the facts stated in the recorded document under 17 U.S.C. § 205(c), provided certain conditions are met (including that the work is specifically identified in the recorded document). Pursuant to the preemption doctrine articulated by the Second Circuit in In re Peregrine Entertainment, Ltd., 116 B.R. 194 (C.D. Cal. 1990), and subsequently followed by the majority of courts addressing the issue, the Copyright Act preempts UCC Article 9 with respect to the perfection of security interests in registered copyrights. In other words, a UCC-1 financing statement filed with a state secretary of state is, standing alone, insufficient to perfect a security interest in a registered copyright as against subsequent bona fide purchasers or transferees. Recordation with the U.S. Copyright Office is required.
For unregistered copyrights — which, as noted above, include the vast majority of copyrightable software code that has not been the subject of a federal copyright registration — perfection is achieved by filing a UCC-1 financing statement with the Delaware Secretary of State, as Meridian's jurisdiction of organization. The Copyright Act preemption applies only to copyrights that have been registered with the Copyright Office; it does not extend to unregistered works. Meridian's Delaware Secretary of State file number is 6038472, and the UCC-1 financing statement should be filed under the exact legal name of Meridian as it appears in the records of the Delaware Secretary of State.
Recommendation: We recommend the following approach to copyright collateral perfection:
(i) Conduct a comprehensive search of the U.S. Copyright Office records to identify all registered copyrights held by Meridian Cloud Solutions Inc. and any of its subsidiaries;
(ii) For all registered copyrights identified, prepare and file copyright security agreements with the U.S. Copyright Office, specifically identifying each registered work by its registration number;
(iii) File UCC-1 financing statements with the Delaware Secretary of State covering all copyrights (both registered and unregistered), as well as all other general intangibles; the UCC filing provides a belt-and-suspenders approach for registered copyrights and constitutes the primary perfection mechanism for unregistered copyrights; and
(iv) Include in the security agreement a broad grant of security interest covering all copyrights and copyrightable works, whether now owned or hereafter acquired, whether registered or unregistered, together with all related rights, claims, and causes of action.
Practical Consideration: In our experience, many SaaS companies — particularly mid-market companies that have grown rapidly and have not had occasion to enforce their copyrights in litigation — do not register copyrights in their software source code with the U.S. Copyright Office. Copyright registration is not required for protection to exist, though it is a prerequisite to bringing a federal infringement action and to obtaining statutory damages and attorneys' fees. It is therefore possible that Meridian has limited or no copyright registrations. This must be confirmed during the intellectual property diligence process. If Meridian has no registered copyrights, the perfection analysis simplifies considerably (UCC filing alone would suffice), but we should be aware that the absence of registration could complicate enforcement of copyright rights in the event of infringement by third parties.
Source Code Escrow Arrangements: An additional consideration in the SaaS context is whether Meridian maintains source code escrow agreements with any of its customers. In some SaaS arrangements — particularly those involving enterprise customers or customers in regulated industries — the customer requires the SaaS vendor to deposit its source code with an independent escrow agent, with release triggers based on vendor bankruptcy, cessation of business, or material breach. If such escrow arrangements exist, we must determine (a) whether the escrow interest (i.e., the vendor's interest in the escrowed source code) is pledgeable as collateral, and (b) whether the escrow agreements contain restrictions on assignment or encumbrance of the vendor's interest. This is a diligence item to be raised with Meridian's CTO.
C. Perfection Requirements — Patents
Security interests in issued patents and pending patent applications are perfected by recording the security interest with the United States Patent and Trademark Office ("USPTO") through the Patent Assignment Recordation system. The USPTO recording should be supplemented by a UCC-1 financing statement filed with the Delaware Secretary of State. While there is some judicial disagreement regarding whether the Patent Act fully preempts UCC Article 9 for perfection purposes (in contrast to the more developed preemption doctrine under the Copyright Act), the prevailing practice in leveraged finance transactions is to record the patent security interest with the USPTO as a matter of prudence and to file the UCC-1 as a supplemental measure.
Recommendation: If Meridian holds any issued patents or pending patent applications, we should:
(i) Conduct a comprehensive USPTO search to identify all issued patents and pending patent applications held by Meridian and its subsidiaries;
(ii) Prepare and file patent security agreements with the USPTO, specifically identifying each patent and application by its patent number or application number;
(iii) File corresponding UCC-1 financing statements with the Delaware Secretary of State; and
(iv) Include in the security agreement provisions requiring Meridian to notify the Administrative Agent of, and to grant a security interest in, any after-acquired patents or patent applications filed during the term of the Facility.
As noted above, it is possible that Meridian does not hold any patents. This must be confirmed as a threshold diligence matter.
D. Perfection Requirements — Trademarks
Security interests in registered trademarks and service marks are perfected by recording the security interest with the USPTO through the Trademark Assignment Recordation system. As with patents, the USPTO filing should be supplemented by a UCC-1 financing statement filed with the Delaware Secretary of State. While the Lanham Act does not contain an express preemption provision equivalent to § 205 of the Copyright Act, the prevailing practice is to record trademark security interests with the USPTO to provide constructive notice and to protect the secured party against subsequent bona fide purchasers and assignees.
Practical Note Regarding Naked Licenses: The grant of a security interest in trademarks, and particularly the potential enforcement of such security interest through foreclosure, must be carefully drafted to avoid creating a "naked license" that could result in the abandonment or cancellation of the mark. A naked license arises when a trademark owner licenses the use of its mark without retaining or exercising adequate quality control over the goods or services offered under the mark. If the security agreement or the enforcement provisions are drafted in a manner that permits the secured party (upon foreclosure) to license or use the mark without maintaining the quality standards associated with the mark, courts may hold that the mark has been abandoned. To mitigate this risk, the trademark security agreement should include provisions that (a) preserve the grantor's obligation to maintain quality control over goods and services bearing the mark during the term of the security interest, and (b) require the secured party, upon foreclosure, to maintain or license the mark in a manner consistent with the quality standards historically associated with the mark.
Recommendation: We recommend the following approach:
(i) Conduct a comprehensive search of the USPTO's Trademark Electronic Search System ("TESS") database to identify all registered trademarks, service marks, and pending applications held by Meridian and its subsidiaries;
(ii) Prepare and file trademark security agreements with the USPTO for all registered marks, specifically identifying each mark by its registration number;
(iii) File UCC-1 financing statements with the Delaware Secretary of State covering all trademarks and service marks (both registered and unregistered), including common-law marks, together with all associated goodwill;
(iv) Ensure that the trademark security agreement includes appropriate quality control provisions to avoid a "naked license" argument; and
(v) Include in the security agreement a broad grant covering all trademarks and service marks, whether now owned or hereafter acquired, whether registered or unregistered, together with all associated goodwill.
E. Trade Secrets and Know-How
Trade secrets and proprietary know-how are classified as "general intangibles" under UCC Article 9. A security interest in general intangibles is perfected by filing a UCC-1 financing statement with the Delaware Secretary of State. There is no federal registration system for trade secrets, and thus no federal-level filing requirement for perfection of a security interest in trade secret assets.
Key Concern: The principal concern with respect to trade secret collateral is the tension between the secured party's need for access to the collateral upon enforcement and the legal requirement that trade secrets must be maintained in confidence to retain their protected status. If the secured party, upon foreclosure, obtains access to Meridian's trade secrets and disseminates or fails to adequately protect them, the trade secret status of the information may be destroyed. This would not only diminish the value of the collateral but could also expose the parties to claims for misappropriation or breach of confidentiality obligations.
Recommendation: The security agreement should include specific provisions governing trade secret collateral, including:
(i) An acknowledgment by the Administrative Agent that the trade secrets constitute confidential information of the grantor;
(ii) A covenant by the Administrative Agent (and any transferee in an enforcement action) to maintain the confidentiality of the trade secret information and to take reasonable measures to prevent unauthorized disclosure;
(iii) Restrictions on access to trade secret collateral, providing that the Administrative Agent may access such information only in connection with a bona fide enforcement action and subject to confidentiality obligations; and
(iv) Provisions requiring that any sale or transfer of trade secret collateral in connection with enforcement be subject to confidentiality agreements binding on the purchaser or transferee.
F. IP-Related Diligence Items
To complete our analysis and to prepare the IP-related collateral documents, we will need to obtain the following information from Meridian. We recommend that these requests be communicated through Meridian's CFO, Maggie Cho, and CTO, Rohan Deshpande, with coordination through Alderton Paige LLP (Richard Fontaine), the Sponsor's acquisition counsel, who is conducting IP diligence in connection with the Acquisition itself:
(a) A complete schedule of all registered and unregistered intellectual property, including all issued patents and pending patent applications, all registered copyrights, all registered trademarks and service marks and pending applications, all material domain names, and a summary description of material trade secrets and proprietary know-how;
(b) All existing intellectual property license agreements, both inbound (licenses from third parties to Meridian) and outbound (licenses from Meridian to customers, partners, or other third parties);
(c) A comprehensive report on all open-source software used in or incorporated into the Meridian platform, including identification of each open-source component, the applicable license type (e.g., MIT, Apache 2.0, GPL, LGPL, AGPL), and any compliance or attribution obligations;
(d) Information regarding any intellectual property-related litigation, disputes, or claims (pending, threatened, or resolved within the past five years), including any patent infringement, copyright infringement, trademark infringement, or trade secret misappropriation claims;
(e) Copies of all standard-form employee and independent contractor intellectual property assignment agreements, together with confirmation of whether all current and former employees and contractors who contributed to the development of the platform have executed such agreements; and
(f) Information regarding any source code escrow arrangements with customers.
We note that Richard Fontaine at Alderton Paige is conducting IP diligence in connection with the Acquisition, and we should coordinate our collateral-related IP diligence requests with their broader diligence effort to avoid duplication and ensure efficiency.
III. Deposit Account Control Agreements (DACAs)
A. UCC Article 9 Perfection Framework
Under Article 9 of the Uniform Commercial Code, a deposit account is defined as "a demand, time, savings, passbook, or similar account maintained with a bank" (UCC § 9-102(a)(29)). When a deposit account serves as original collateral (as opposed to proceeds of other collateral), perfection of a security interest in the deposit account can only be achieved through "control." A UCC-1 financing statement filed with the Secretary of State is not a permissible method of perfection for a deposit account as original collateral. UCC § 9-312(b)(1) expressly provides that a security interest in a deposit account may be perfected only by control under UCC § 9-104.
Under UCC § 9-104, a secured party has "control" of a deposit account in one of three circumstances:
(i) The secured party is the bank. If the bank maintaining the deposit account is itself the secured party, control exists automatically by virtue of the banking relationship. In this transaction, if Brindoval National Bank, N.A. (as Administrative Agent) maintains any of Meridian's or the Borrower's deposit accounts, perfection by control would be achieved automatically with respect to those accounts. However, even in this circumstance, execution of a DACA is advisable to clarify the secured party's enforcement rights and the bank's obligations;
(ii) A control agreement (DACA). The most common method in leveraged finance transactions, a DACA is a three-party agreement among the depositor (the account holder), the depository bank, and the secured party. Under the DACA, the depositary bank agrees to comply with instructions originated by the secured party directing the disposition of funds in the deposit account, without further consent from the depositor; and
(iii) The secured party becomes the bank's customer. The secured party becomes a customer of the bank with respect to the deposit account. This method is rarely used in practice.
DACAs are the standard method for achieving control over deposit accounts in leveraged finance transactions. Each DACA must be individually negotiated and executed with the depository bank maintaining the account.
B. Application to Meridian
In order to perfect the security interest in Meridian's deposit accounts (and, post-closing, in the Borrower's deposit accounts), DACAs will need to be executed for each deposit account maintained by Meridian and the Borrower. This requires a threshold identification of all deposit accounts and all depository institutions with which Meridian maintains banking relationships.
We should request from Maggie Cho, Meridian's CFO, a complete list of all deposit accounts maintained by Meridian and its subsidiaries, including for each account: (a) the account name and account number, (b) the depository institution, (c) the purpose of the account (operating, payroll, tax withholding, benefits, sweep, escrow, etc.), (d) the approximate average balance, and (e) any existing control agreements, pledges, or restrictions on the account.
DACAs will need to be executed between Meridian (as depositor), each depository bank, and Brindoval National Bank, N.A. (as Administrative Agent). A typical mid-market SaaS company of Meridian's size and operational complexity may maintain accounts at multiple financial institutions — often including a primary operating bank for revenue deposits and disbursements, a separate payroll processing bank, one or more sweep or investment accounts, and potentially tax withholding or escrow accounts. Each depository relationship will require a separate DACA negotiation.
If Brindoval National Bank, N.A. also serves as a depository bank for any Meridian accounts (either currently or post-closing), automatic perfection by control may apply under UCC § 9-104(a)(1), since the secured party is the bank. However, we still recommend that a formal DACA (or equivalent agreement) be executed to establish the Administrative Agent's enforcement rights and to provide clarity regarding the disposition of funds in the event of a default.
C. Timing and Practical Considerations
In our experience, DACAs are frequently the single most time-consuming closing deliverable in leveraged acquisition financings. The delay arises from several factors:
• Depository banks typically insist on using their own form control agreements, which often differ materially from the form preferred by the secured party (the Administrative Agent);
• Depository banks may require internal credit or legal approval before executing a DACA, and the approval timelines vary significantly by institution;
• Negotiations over key DACA terms — including the timing and conditions for the activation of "springing" control (i.e., the point at which the Administrative Agent may direct the disposition of funds without the depositor's consent), the depository bank's indemnification rights, and the depositor's right to continue using the account until a default occurs — can be protracted; and
• In transactions involving acquisitions, the target company's existing banking relationships may not have previously been subject to DACAs, and the depository banks may be unfamiliar with the process or reluctant to accommodate.
Recommendation: We recommend the following approach to manage the DACA process:
(i) Identify all deposit accounts and depository institutions as early as possible in the diligence process — no later than the commencement of the formal due diligence period on April 21, 2026;
(ii) Initiate outreach to depository banks and begin DACA negotiations well in advance of the targeted June 30, 2026 closing date, to allow adequate time for negotiation, internal bank approvals, and execution;
(iii) In the term sheet markup, negotiate a post-closing period of 60 to 90 days following the closing date for the delivery of DACAs with respect to existing deposit accounts that cannot be controlled by closing — this is a customary accommodation in leveraged finance transactions and should be raised as a term sheet point in our March 28 markup; and
(iv) For the Borrower's newly established accounts (which will be opened at or around closing to receive the loan proceeds and to fund the Acquisition), coordinate the DACA execution simultaneously with the account opening so that control is established at closing.
D. Securities Accounts and Investment Property
If Meridian or the Borrower holds any securities accounts (as defined in UCC § 8-501) or investment property, a control agreement with the relevant securities intermediary (the broker-dealer or bank acting as custodian) will be required to perfect the security interest in such assets. Under UCC §§ 9-106 and 8-106, control of a securities account is established by entering into a three-party control agreement with the securities intermediary, or by the secured party becoming the entitlement holder with respect to the account.
We should determine during diligence whether any of Meridian's operating cash is held in money market funds, sweep accounts, or other short-term investment vehicles that may be characterized as securities accounts (rather than deposit accounts) under the UCC. The distinction is significant because the perfection requirements and the applicable control agreement forms differ between deposit accounts and securities accounts. If Meridian's primary operating accounts include an automated sweep feature that moves excess cash balances into a money market fund or similar investment vehicle, the swept funds may reside in a securities account maintained by a securities intermediary, and a separate control agreement with that intermediary will be required.
E. Excluded Accounts
It is customary in leveraged finance transactions to negotiate exclusions from the DACA requirement for certain categories of deposit accounts where the administrative burden and cost of obtaining a DACA outweigh the incremental collateral value to the lender. We recommend negotiating the following DACA exclusions, to be reflected in the credit agreement's definitions of "Collateral" and "Excluded Assets":
• Payroll and benefits accounts — accounts maintained solely for the purpose of funding payroll, employee benefits, and related disbursements, up to a specified threshold amount (e.g., an aggregate balance not to exceed the amount of one payroll cycle);
• Tax withholding accounts — accounts maintained solely for the purpose of holding funds for the payment of federal, state, and local tax withholding obligations;
• Escrow accounts required by third-party contracts — accounts maintained in escrow pursuant to obligations under customer contracts, vendor agreements, or other third-party arrangements, where the escrow terms may prohibit the grant of a security interest;
• Zero-balance accounts — accounts that are designed to have a zero balance at the end of each business day, with all funds swept to a controlled operating account;
• De minimis accounts — accounts with an average daily balance below a specified de minimis threshold, which we recommend setting at $100,000 per account (the specific threshold will be a point of negotiation with Brindoval).
These exclusions should be expressly defined in the credit agreement and cross-referenced in the security agreement and the collateral schedules.
IV. Equity Pledges
A. Term Sheet Requirements
The Draft Term Sheet requires the grant of a first-priority perfected security interest in: (a) 100% of the equity interests of each direct and indirect domestic subsidiary of the Borrower; and (b) 65% of the voting equity interests (and 100% of the non-voting equity interests) of each first-tier foreign subsidiary. This formulation is standard in sponsor-backed leveraged finance transactions and reflects the customary approach to equity pledge collateral.
The 65% limitation on foreign subsidiary equity pledges is driven by United States federal income tax considerations. Under Section 956 of the Internal Revenue Code (26 U.S.C. § 956), if a United States shareholder of a "controlled foreign corporation" (a "CFC") pledges more than 66⅔% of the CFC's voting stock to secure an obligation, the pledge may be treated as an investment by the CFC in United States property, resulting in a deemed repatriation of the CFC's undistributed earnings and profits as taxable income to the U.S. shareholder. By limiting the pledge to 65% of the voting stock — below the 66⅔% threshold — the parties avoid triggering this adverse tax consequence. It is worth noting that while recent amendments to the tax code under the Tax Cuts and Jobs Act of 2017 have modified the mechanics of CFC taxation, the 65% pledge limitation remains the market standard practice in leveraged finance transactions.
B. Application to Transaction Structure
The equity pledge hierarchy for this transaction is as follows:
Level 1 — Fund IV's Interest in the Borrower. Fund IV holds a 100% membership interest in Solara Digital Acquisition Holdings LLC (the Borrower). We should confirm with the Sponsor whether the Draft Term Sheet requires a pledge of Fund IV's equity interest in the Borrower as part of the collateral package, or whether the pledge structure begins at the Borrower level and extends only downstream. If a pledge at this level is required, the pledge will be made by Fund IV, and the security interest will be perfected by filing a UCC-1 financing statement with the Delaware Secretary of State (since the Borrower is a Delaware LLC). This pledge may also implicate Fund IV's limited partnership agreement and any restrictions on the disposition of Fund IV's investment interests.
Level 2 — Borrower's Interest in Meridian. Following the closing of the Acquisition, the Borrower will hold 100% of the outstanding equity interests (common stock) of Meridian Cloud Solutions Inc. This equity interest will be pledged by the Borrower to the Administrative Agent. The pledge of Meridian stock is a critical component of the collateral package, as it represents the secured party's direct access to the enterprise value of Meridian and its subsidiaries. Perfection is discussed in Section IV.C below.
Level 3 — Meridian's Interests in Domestic Subsidiaries. Meridian is expected to hold 100% of the equity interests in each of its material domestic subsidiaries. We do not yet have a complete subsidiary organizational chart, and this is a priority diligence item. Each domestic subsidiary's equity interest held by Meridian will be pledged to the Administrative Agent.
Level 4 — Meridian's Interests in Foreign Subsidiaries (if any). If Meridian has any first-tier foreign subsidiaries, 65% of the voting equity interests (and 100% of the non-voting equity interests) in each such foreign subsidiary will be pledged by Meridian. We do not yet know whether Meridian has any foreign subsidiaries or foreign operations, and this must be confirmed during diligence.
Equity Rollover Consideration. Jason Tremblay, Meridian's founder and CEO, is rolling over $20,000,000 in equity into the Acquisition vehicle. We should confirm with the Sponsor and its acquisition counsel the precise structure of the rollover — specifically, whether Tremblay's rollover equity will be a separate class of membership interest in the Borrower (e.g., a Class B interest), whether it will be pari passu with Fund IV's equity or subordinate to it, and how the rollover interest interacts with the equity pledge. In most sponsor-backed acquisitions, the management rollover equity is subordinate to the pledged interest (i.e., the pledge of the Borrower's equity in Meridian takes priority over the economic interests of the rollover equity holders in the Borrower), but the specific intercreditor and waterfall mechanics should be confirmed and documented.
C. Perfection of Equity Pledges
The perfection requirements for equity pledges depend on the nature of the equity interest being pledged:
LLC Membership Interests (Borrower and any LLC Subsidiaries). Membership interests in a limited liability company are classified as "general intangibles" under UCC Article 9. A security interest in a general intangible is perfected by filing a UCC-1 financing statement with the office of the Secretary of State in the jurisdiction in which the pledgor is organized. For the Borrower's membership interest in Meridian (where the pledgor is the Borrower, a Delaware LLC, DE SOS File No. 7531209), the UCC-1 filing would be made with the Delaware Secretary of State. If any Meridian subsidiaries are organized as LLCs, the same analysis applies, with the filing jurisdiction determined by Meridian's state of organization (Delaware, DE SOS File No. 6038472).
Corporate Stock (Meridian and any Corporate Subsidiaries). Shares of stock in a corporation may be either certificated or uncertificated. The perfection analysis differs based on this distinction:
• Certificated shares: If Meridian's shares are evidenced by physical stock certificates, the security interest is perfected by the secured party's possession of the stock certificates, either endorsed in blank or accompanied by duly executed stock powers. See UCC § 9-313(a). This method provides the highest degree of protection and is the preferred method for certificated securities. A supplemental UCC-1 filing with the Delaware Secretary of State is also advisable.
• Uncertificated shares: If Meridian's shares are uncertificated, perfection can be achieved by (a) "control" under UCC § 8-106(c) (by having the issuer register the secured party as the registered owner, or by having the issuer agree to comply with the secured party's instructions without the further consent of the registered owner), or (b) by filing a UCC-1 financing statement. Control provides a superior perfection method (UCC § 9-328(1) — a security interest perfected by control has priority over a security interest perfected by filing).
Recommendation: We should confirm with Meridian's existing counsel (Kerrigan Ross or applicable corporate counsel) whether Meridian's shares of common stock are certificated or uncertificated. If certificated, original stock certificates and executed blank stock powers will be required as closing deliverables and should be included in the closing checklist. If uncertificated, we will need to arrange for the issuer (Meridian) to enter into a control agreement or to register the pledge on its books.
Foreign Subsidiary Equity (if applicable). If Meridian holds equity interests in any foreign subsidiaries, we will need to analyze the local law perfection requirements in the relevant foreign jurisdiction in addition to the UCC filing. Many foreign jurisdictions require registration of the security interest with a local governmental authority, notarization or apostille of the pledge agreement, or other local-law formalities. We should engage local counsel in any applicable foreign jurisdiction once the subsidiary structure is confirmed.
D. Organizational Document Considerations
A comprehensive review of the organizational documents of both the Borrower and Meridian is necessary to identify any provisions that may restrict or complicate the equity pledge:
Meridian's Certificate of Incorporation and Bylaws. We should review Meridian's certificate of incorporation, bylaws, and any stockholders' agreement for provisions restricting the transfer or encumbrance of Meridian stock, including rights of first refusal, consent requirements, tag-along rights, drag-along rights, co-sale rights, or contractual prohibitions on pledging. Such provisions are common in privately held technology companies, particularly where there are minority stockholders or investor-rights agreements from prior financing rounds. To the extent any such restrictions exist, they will need to be waived (by the requisite vote of stockholders or the board of directors) or amended in connection with the Acquisition to permit the grant of the equity pledge and potential enforcement through foreclosure.
Borrower's LLC Agreement. The Borrower is a newly formed Delaware LLC created specifically for purposes of this Acquisition. Its LLC agreement should be drafted from inception to permit the equity pledge in favor of the Administrative Agent, to provide for the Administrative Agent's rights as a transferee upon foreclosure, and to eliminate any transfer restrictions that could impede enforcement. We should coordinate with Alderton Paige on the drafting of the Borrower's LLC agreement to ensure that the collateral-related provisions are incorporated from the outset.
V. Customer Contract Assignment Restrictions
A. Nature of the Issue
SaaS businesses derive substantially all of their revenue from recurring subscription agreements with customers. Meridian's $62.4 million in annualized recurring revenue ("ARR") for the trailing twelve months ended December 31, 2025, is generated from subscription contracts under which customers pay periodic fees (typically monthly or annually) for access to Meridian's cloud-based platform. These customer contracts represent the economic lifeblood of the business, and the accounts receivable arising from them are a critical component of the collateral package.
A significant number of SaaS customer agreements contain anti-assignment clauses that restrict the assignment of the contract — or the account receivable arising under the contract — without the customer's prior written consent. Such clauses are particularly prevalent in agreements with enterprise customers, financial institutions, and regulated entities, where the customer has a strong interest in controlling the identity and capabilities of its service provider. Anti-assignment clauses in SaaS customer agreements may take various forms, ranging from a blanket prohibition on assignment without consent, to more nuanced provisions that distinguish between assignment of the contract (i.e., the vendor's obligations and rights) and assignment of the right to payment.
The interaction between anti-assignment clauses in customer contracts and the secured party's interest in the accounts receivable arising from those contracts is governed by UCC Article 9, which provides important protections for secured parties.
B. UCC § 9-406 and the Override of Anti-Assignment Clauses
Under UCC § 9-406(d), a term in an agreement between an account debtor (the customer) and an assignor (Meridian) that restricts the assignment of, or the creation of a security interest in, an "account" (as defined in UCC § 9-102(a)(2)) is ineffective to the extent that it purports to prevent or restrict the creation, attachment, or perfection of a security interest in the account. In other words, anti-assignment clauses in customer contracts are overridden by operation of law for purposes of creating and perfecting a security interest in the right to payment (the account receivable) arising under the contract.
This means that the security interest in Meridian's accounts receivable arising from customer subscription agreements should be enforceable as against the account debtors (customers) notwithstanding any anti-assignment clauses in the underlying contracts. The Administrative Agent should be able to perfect its security interest in Meridian's receivables by filing a UCC-1 financing statement, and the anti-assignment clauses should not impair the grant or perfection of that security interest.
However, the UCC § 9-406 override is limited in scope. It applies to the right to payment — i.e., the account receivable — but does not override anti-assignment clauses with respect to the full panoply of contractual rights under the customer agreement. In particular, the override does not extend to the assignability of the vendor's performance obligations, the vendor's right to continue providing services under the contract, or other non-payment rights embedded in the customer agreement.
C. Practical Implications for Collateral Enforcement
The distinction between the security interest in the receivable (which is enforceable notwithstanding anti-assignment clauses) and the secured party's ability to step into the vendor's shoes under the customer contract (which may be restricted) has important practical implications in an enforcement scenario.
In the event of a default under the credit agreement and enforcement of the security interest in Meridian's accounts receivable, the Administrative Agent would be entitled to collect the receivables — i.e., to receive the payments owing under the customer contracts. However, the Administrative Agent's ability to assume Meridian's position under the customer contracts, to continue providing the SaaS services, or to assign the customer contracts to a purchaser in connection with a collateral disposition, may be limited by the anti-assignment clauses in the customer agreements. This is primarily a remedies issue rather than a perfection issue, but it directly affects the practical value of the collateral to the lender group. A secured party that can collect receivables but cannot operate the business (or transfer the customer contracts as a going concern) will realize significantly less value from the collateral than one that can do both.
This dynamic is inherent in SaaS collateral packages and is well understood by lender groups active in the technology sector. The value of the collateral in a SaaS financing is largely a function of the ongoing customer relationships and the recurring revenue stream they generate, rather than the liquidation value of the underlying assets. Accordingly, lenders in SaaS financings typically rely on the expectation that enforcement will take the form of a going-concern sale of the business (through foreclosure on the equity pledge) rather than a piecemeal liquidation of individual contract rights.
D. Diligence and Recommendations
Diligence Items:
(i) Request from Meridian a representative sample of customer agreements, including the agreements with the top ten customers by ARR, to review the specific language of any anti-assignment provisions;
(ii) Identify any customer contracts that include change-of-control provisions that may be triggered by the Acquisition itself — such provisions may require customer consent or notification in connection with the change of control of Meridian, and the failure to comply could result in a termination right in favor of the customer; this is both an acquisition diligence issue and a collateral issue, and we should coordinate with Alderton Paige on this point; and
(iii) Confirm with Meridian whether any customer contracts contain provisions that specifically address the grant of security interests or the pledge of receivables.
Recommendations for Term Sheet / Credit Agreement:
(i) Include a customary acknowledgment in the credit agreement (and in the security agreement) that anti-assignment restrictions in customer contracts do not impair the grant, attachment, or perfection of the security interest in the receivables arising under those contracts, consistent with UCC § 9-406;
(ii) Negotiate a collateral exclusion for customer contracts (as distinct from the receivables arising thereunder) only to the extent that the grant of a security interest in the full contract rights (as opposed to the receivable) would result in a breach or termination of the contract and such restriction is not overridden by applicable law — this is a narrow, targeted exclusion designed to avoid a technical breach of anti-assignment clauses while preserving the security interest in the accounts receivable; and
(iii) Consider whether any key customer contracts identified during diligence require affirmative customer consent to the change of control. If so, obtaining such consents should be added to the closing conditions or post-closing obligations, as appropriate.
E. Government Contracts
If Meridian serves any government or quasi-government customers, additional assignment restrictions may apply under federal law. The federal Anti-Assignment Act (41 U.S.C. § 6305) generally prohibits the transfer or assignment of government contracts or any interest therein without the prior approval of the contracting agency. The Assignment of Claims Act (31 U.S.C. § 3727) restricts the assignment of claims against the United States government, subject to certain exceptions for assignments to banks, trust companies, or other financing institutions. If Meridian holds any government contracts, a separate legal analysis of the collateral implications will be required, as the UCC § 9-406 override may not apply to government contracts, and the perfection and enforceability of security interests in receivables arising from government contracts are subject to the specific requirements of federal law.
We should confirm with Meridian whether it is a party to any contracts with federal, state, or local government agencies or with quasi-governmental entities.
VI. Excluded Assets Analysis
A. Overview. Although the Draft Term Sheet calls for a security interest in "substantially all assets" of the Borrower, Meridian, and the Guarantors, it is customary in leveraged finance transactions to negotiate express exclusions for certain categories of assets. These exclusions apply where the cost, administrative burden, or legal risk of granting and perfecting a security interest outweighs the incremental collateral value to the lender group. In a SaaS transaction, the excluded assets analysis takes on particular importance because of the prevalence of licensed technology, the centrality of intellectual property, and the role of customer contract rights.
We recommend negotiating the following categories of excluded assets in the credit agreement and security documents. These exclusions are consistent with market practice in comparable sponsor-backed SaaS financings and should be acceptable to Brindoval and its counsel.
B. Immaterial intellectual Property
We recommend defining a category of "Excluded IP" to exclude from the collateral package intellectual property that is immaterial to the business operations of the Borrower, Meridian, and the Guarantors. Examples of immaterial IP that would fall within this exclusion include:
• Abandoned or lapsed trademark registrations that are no longer in use or for which renewal filings have not been made;
• Domain names that are not used in connection with Meridian's core business or products (e.g., defensive or dormant domain registrations);
• Copyrights in marketing materials, press releases, blog posts, or internal training documents that do not relate to the core platform technology; and
• Patents or patent applications that have been abandoned, allowed to lapse, or that cover technology no longer used in the platform.
The exclusion should be carefully drafted to ensure that all intellectual property that is material to the core SaaS platform and product offerings remains squarely within the collateral package. The boundary between "material" and "immaterial" IP should be defined with sufficient specificity to avoid ambiguity.
Recommendation: We propose an express exclusion for intellectual property with a fair market value below a specified threshold — for example, $250,000 individually or in the aggregate for a related group of assets — subject to the Administrative Agent's right to request inclusion of any excluded IP asset if it subsequently becomes material to the business. This approach provides administrative relief while preserving the lender's ability to capture IP that increases in value over time. The specific threshold will be a point of negotiation with Brindoval.
C. License Agreements with Anti-Assignment Clauses
Certain of Meridian's inbound license agreements — including third-party software licenses, technology licenses, and data provider agreements — may contain anti-assignment or anti-encumbrance provisions that would be breached if Meridian grants a security interest in the license rights. This issue is distinct from the customer contract anti-assignment analysis discussed in Section V, as it concerns inbound licenses (where Meridian is the licensee) rather than outbound contracts (where Meridian is the vendor).
The UCC addresses this issue in § 9-408, which provides that a term in a license agreement prohibiting the creation of a security interest in the licensee's rights under the license is ineffective insofar as it prevents the attachment of the security interest. In other words, the security interest can attach to the license rights notwithstanding the anti-assignment clause. However, § 9-408 critically provides that the security interest created in this manner does not give the secured party any enforcement rights that would violate the anti-assignment clause. The practical result is that the security interest attaches to the license rights (and would thus have some effect in bankruptcy, for example), but the secured party cannot exercise remedies with respect to the license — such as transferring or sublicensing the license to a third-party purchaser — without the consent of the licensor, unless the anti-assignment clause is waived or otherwise overridden.
This creates a collateral gap: the security interest exists but is effectively unenforceable against the licensor without its consent. Attempting to enforce the security interest in a manner that violates the anti-assignment clause could trigger a breach or termination of the license, which in turn could deprive Meridian (or a successor to Meridian's business) of access to critical third-party technology.
Recommendation: We recommend the following approach:
(i) Exclude from the collateral any inbound license agreement to the extent — and only to the extent — that the grant of a security interest therein would result in a breach or termination of such license under its terms and applicable law does not override such restriction. This is a narrowly tailored "springing" exclusion: once the restriction is eliminated (whether by licensor consent, amendment of the license, or a change in applicable law), the license rights automatically become part of the collateral without further action;
(ii) The security agreement should include an express provision confirming the springing nature of the exclusion and the automatic inclusion of previously excluded license rights upon the elimination of the restriction;
(iii) The credit agreement should include a covenant requiring Meridian to use commercially reasonable efforts to obtain any necessary licensor consents to the grant of a security interest, where doing so would not result in material cost or disruption to the business; and
(iv) For licenses that are critical to the operation of the platform, consider seeking licensor consent to the security interest as a closing condition or post-closing deliverable.
Diligence Item: Request from Meridian (via Rohan Deshpande, CTO) a complete list of all inbound third-party license agreements, together with copies of the relevant agreements, so that we can identify those containing anti-assignment or anti-encumbrance provisions. Of particular focus will be:
• Third-party cloud infrastructure agreements (e.g., Ridgeway Industries, Crestline Systems, Aldermere Technologies, or similar IaaS/PaaS providers) — these agreements typically contain restrictions on the assignment or encumbrance of the customer's rights, though the specific terms vary by provider;
• Third-party data feeds and data provider agreements — Meridian's portfolio analytics and data aggregation functionality may depend on data feeds from third-party providers, whose license agreements may restrict assignment or encumbrance;
• Third-party software components embedded in or integrated with the Meridian platform — including any proprietary components licensed from third parties and incorporated into the platform architecture; and
• Open-source software licenses — while open-source licenses are generally permissive with respect to use, modification, and distribution, certain copyleft licenses (such as GPL, LGPL, and AGPL) impose conditions on the distribution or commercial exploitation of derivative works that may have collateral implications. We should review Meridian's open-source usage and assess whether any open-source license obligations could affect the secured party's ability to dispose of the platform software upon enforcement.
D. Other Customary Exclusions
In addition to the IP-specific and license-specific exclusions described above, we recommend negotiating the following customary excluded asset categories:
Leasehold Interests. Leasehold interests in real property where the landlord's consent to collateral assignment has not been obtained. If Meridian leases its office space at 450 Technology Parkway, Suite 800, Austin, Texas (as we expect is the case), the lease agreement may prohibit the tenant from assigning or encumbering its leasehold interest without the landlord's consent. Granting a security interest in the leasehold without consent could constitute a default under the lease. We recommend excluding such leasehold interests from the collateral package unless and until landlord consent is obtained.
Certificate-of-Title Assets. Vehicles and other assets subject to certificate-of-title statutes where the filing of a UCC-1 financing statement is insufficient for perfection and perfection instead requires notation of the security interest on the certificate of title. For a SaaS company like Meridian, the value of such assets is likely to be minimal, and the administrative burden of obtaining title notations outweighs the collateral benefit.
Intent-to-Use Trademark Applications. Intent-to-use ("ITU") trademark applications filed with the USPTO to the extent that granting a security interest before the applicant has made bona fide use of the mark in commerce would invalidate the application under Section 10 of the Lanham Act (15 U.S.C. § 1060). ITU applications may be included in the collateral only after the mark has been used in commerce and a statement of use has been filed with the USPTO.
Letter-of-Credit Rights. Letter-of-credit rights to the extent that a security interest therein cannot be perfected by control. UCC § 9-312(b)(2) provides that a security interest in a letter-of-credit right may be perfected only by control under UCC § 9-107. If the issuing or confirming bank will not enter into a control agreement, the letter-of-credit right should be excluded from the collateral to the extent perfection cannot be achieved.
Restricted Joint Venture and Minority Interests. Equity interests in joint ventures or minority investments where the organizational documents of the joint venture entity prohibit pledging without the consent of the other equity holders and such consent has not been obtained. Forcing a pledge ove

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