SUMMARY OF TERMS AND CONDITIONS
$200,000,000 SENIOR SECURED TERM LOAN FACILITY
Borrower's Markup — Clean Version
March 28, 2026
CONFIDENTIAL — FOR DISCUSSION PURPOSES ONLY. This term sheet does not constitute a commitment to lend or a binding agreement. Terms are subject to negotiation, execution of definitive documentation, and satisfaction of all conditions precedent.
This Summary of Terms and Conditions (this "Term Sheet") sets forth the principal terms and conditions for a proposed $200,000,000 Senior Secured Term Loan Facility as described herein. This Term Sheet reflects the Borrower's first markup (clean version) of the initial draft term sheet delivered by Brindoval National Bank, N.A. on March 21, 2026, as reviewed and marked up by Calderwood & Harkness LLP on behalf of the Borrower. All capitalized terms used herein and not otherwise defined shall have the meanings ascribed to them in Schedule A (Key Definitions) attached hereto or as otherwise set forth herein.
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SECTION 1: PARTIES
1.1 Borrower. Solara Digital Acquisition Holdings LLC, a Delaware limited liability company to be formed as a wholly owned subsidiary of Solara Digital Infrastructure Fund IV LP ("Fund IV"). The Borrower will serve as the acquisition vehicle for the transactions described in Section 2 below.
Address: c/o Solara Digital Infrastructure LP, 1700 Market Street, Suite 2400, Wilmington, DE 19801
EIN: 93-4718206 (applied for; pending IRS assignment)
Delaware Secretary of State File No.: 7531209 (to be filed)
1.2 Sponsor. Solara Digital Infrastructure LP, a Delaware limited partnership (the "Sponsor" or "Solara"), acting through its general partner, Solara Digital GP LLC, a Delaware limited liability company.
EIN: 84-3291057
Delaware Secretary of State File No.: 7294185
The Sponsor is a technology-focused private equity firm with over $4.5 billion in assets under management across four institutional fund vintages. The Sponsor will direct the acquisition of Meridian Cloud Solutions Inc. through Fund IV and will maintain operational oversight of the acquired business through the Borrower.
1.3 Guarantors. The following entities shall serve as Guarantors under the Facility:
(a) Solara Digital Infrastructure LP (as Sponsor Guarantor, limited recourse). The Sponsor guaranty shall be limited in scope to (i) losses arising from "bad boy" acts (fraud, willful misconduct, and bad faith by the Sponsor or its controlled affiliates), (ii) environmental indemnification obligations, and (iii) certain specific representations relating to the Sponsor, as more fully described in Section 15 below. For the avoidance of doubt, the Sponsor guaranty is not a guaranty of the Borrower's payment obligations under the Facility and does not extend to covenant compliance by the Borrower (other than as expressly set forth in Section 15).
(b) Meridian Cloud Solutions Inc. (post-closing), a Delaware corporation, as a full recourse Guarantor of the Borrower's obligations under the Facility. The guaranty of Meridian shall be delivered as a condition to closing or, if not delivered on the Closing Date, within the timeframe set forth in Schedule E (Post-Closing Obligations).
(c) Each Material Domestic Subsidiary of Meridian. For purposes of this Term Sheet, "Material Domestic Subsidiary" means any direct or indirect domestic subsidiary of Meridian that represents 5% or more of consolidated revenues or 5% or more of consolidated total assets of the Borrower and its subsidiaries, determined as of the last day of the most recently ended fiscal quarter for which financial statements have been delivered. Each Material Domestic Subsidiary shall deliver a full recourse guaranty of the Borrower's obligations under the Facility. The materiality threshold set forth in this Section 1.3(c) reflects the Borrower's proposed threshold; the Brindoval initial draft did not include a materiality qualifier for subsidiary guarantors.
1.4 Administrative Agent
Brindoval National Bank, N.A. (the "Administrative Agent" or "Agent")
Address: 383 Madison Avenue, 14th Floor, New York, NY 10179
Contact: Thomas Wilder, Managing Director, Technology Leveraged Finance
The Administrative Agent shall act in such capacity for and on behalf of the Lenders in accordance with the terms and conditions of the definitive Credit Agreement. The Administrative Agent shall have such rights, duties, and obligations as are customary for an administrative agent in senior secured term loan facilities of this nature.
1.5 Lead Arranger and Sole Bookrunner
Brindoval National Bank, N.A. shall serve as the sole Lead Arranger and Sole Bookrunner with respect to the Facility. In such capacity, Brindoval shall be responsible for structuring, arranging, and syndicating the Facility on the terms described herein.
1.6 Lenders.
(a) Brindoval National Bank, N.A. shall initially underwrite the full $200,000,000 Facility amount. Following the Closing Date, Brindoval intends to syndicate a portion of its commitments to achieve a target hold position of $75,000,000.
(b) Anticipated syndication participants and indicated commitments are as follows:
The foregoing indicated amounts are preliminary and are subject to change based on market conditions and the results of the syndication process. All syndication assignments and participations shall be subject to the Borrower's consent rights as set forth in Section 17.2.
SECTION 2: TRANSACTION OVERVIEW
2.1 Purpose. The proceeds of the Facility shall be used solely for the following purposes:
(a) To finance, in part, the acquisition (the "Acquisition") by the Borrower of 100% of the outstanding equity interests of Meridian Cloud Solutions Inc. ("Meridian" or the "Target") from Meridian's existing shareholders, consisting of (i) Ashford Ventures Partners LLC (holding approximately 52% of the outstanding equity), (ii) Jason Tremblay, Meridian's founder and Chief Executive Officer (holding approximately 28% of the outstanding equity), and (iii) certain management and employee holders (holding collectively approximately 20% of the outstanding equity);
(b) To pay related transaction fees, costs, and expenses incurred in connection with the Acquisition and the Facility, estimated at approximately $12,000,000 in the aggregate (inclusive of the arrangement fee, structuring fee, legal fees, accounting fees, advisory fees, title and insurance premiums, and other customary closing costs); and
(c) To provide cash to the balance sheet of the acquired business in the amount of $3,000,000, to be held as working capital for the ongoing operations of Meridian.
No portion of the proceeds of the Facility shall be used, directly or indirectly, for any purpose that would violate applicable law, including without limitation the regulations of the Board of Governors of the Federal Reserve System (including Regulations T, U, and X), the USA PATRIOT Act, the Foreign Corrupt Practices Act, or any sanctions program administered by the U.S. Department of the Treasury's Office of Foreign Assets Control ("OFAC").
2.2 Acquisition. The Acquisition shall be structured as a purchase by the Borrower of 100% of the outstanding equity interests of Meridian Cloud Solutions Inc.
Target: Meridian Cloud Solutions Inc., a Delaware corporation
Delaware Secretary of State File No.: 6038472
Headquarters: 450 Technology Parkway, Suite 800, Austin, TX 78759
Enterprise Value / Purchase Price: $315,000,000, representing approximately 16.84x Meridian's last-twelve-months ("LTM") Adjusted EBITDA of $18,700,000 as of the most recently completed twelve-month period.
Founder Rollover: Jason Tremblay, Meridian's founder and Chief Executive Officer, has agreed to roll over approximately $20,000,000 of his sale proceeds into equity of the Borrower (or a newly formed acquisition subsidiary), thereby retaining a meaningful equity stake in the go-forward business alongside the Sponsor. The rollover equity shall not constitute proceeds available to reduce the Purchase Price for purposes of the Sources and Uses analysis below.
Meridian is a provider of enterprise cloud infrastructure and managed services solutions, serving approximately 340 enterprise customers across the technology, financial services, and healthcare verticals. Meridian's software-as-a-service ("SaaS") platform generates recurring subscription revenues representing approximately 82% of total revenues, with a Net Revenue Retention rate exceeding 115% over the trailing twelve-month period.
2.3 Sources and Uses
The following table sets forth the estimated sources and uses of funds in connection with the Acquisition and the transactions contemplated hereby:
Sources of Funds:
Uses of Funds:
The Equity Contribution from Fund IV represents approximately 41.3% of the Enterprise Value ($130,000,000 ÷ $315,000,000), reflecting a robust equity cushion supporting the credit structure. The Equity Contribution shall be funded in cash on or prior to the Closing Date, substantially contemporaneously with the initial funding of the Term Loans. Evidence of the availability of the Equity Contribution (in the form of a capital call notice or equity commitment letter from Fund IV) shall be delivered as a condition precedent to closing.
SECTION 3: FACILITY TERMS
3.1 Facility Type
Senior Secured Term Loan Facility (the "Facility" or the "Term Loan Facility").
3.2 Facility Amount
$200,000,000 (Two Hundred Million Dollars).
3.3 Maturity Date
Seven (7) years from the Closing Date (the "Maturity Date"). Based on a targeted Closing Date of June 30, 2026, the targeted Maturity Date would be June 30, 2033. All outstanding principal, together with all accrued and unpaid interest, fees, and other obligations under the Facility, shall be due and payable in full on the Maturity Date.
3.4 Availability. The Facility shall be available in a single draw on the Closing Date, subject to the satisfaction (or waiver by the Administrative Agent and Required Lenders, as applicable) of all conditions precedent set forth in Section 8 hereof. Any amounts repaid or prepaid under the Facility may not be reborrowed.
SECTION 4: PRICING
4.1 Interest Rate
The Term Loans shall bear interest at a rate per annum equal to:
Adjusted Term SOFR + 475 basis points (4.75%)
For purposes of this Term Sheet:
(a) "Adjusted Term SOFR" means the Term SOFR Rate (as published by the CME Group Benchmark Administration Limited, or a successor administrator, for the applicable interest period) plus the SOFR Credit Spread Adjustment of 10 basis points (0.10%).
(b) "SOFR Floor": The Term SOFR Rate shall be deemed to be not less than 1.00% per annum for purposes of calculating the applicable interest rate. If at any time the Term SOFR Rate (before giving effect to the SOFR Credit Spread Adjustment) is less than 1.00%, the Term SOFR Rate shall be deemed to be 1.00%.
(c) "Interest Periods": The Borrower may elect interest periods of one (1), three (3), or six (6) months, as selected by the Borrower in its interest election request delivered in accordance with the terms of the definitive Credit Agreement. The six-month interest period option is included at the Borrower's request and was not present in the Brindoval initial draft. Customary provisions for the unavailability of SOFR and transition to an alternative benchmark rate shall be included in the definitive Credit Agreement.
4.2 Default Rate
Upon the occurrence and during the continuance of an Event of Default, the outstanding principal amount of the Term Loans shall bear interest at a rate per annum equal to the otherwise applicable interest rate plus an additional 2.00% (200 basis points) (the "Default Rate").
The application of the Default Rate shall be subject to the following conditions:
(a) The Default Rate shall be applicable only upon the occurrence and during the continuance of (i) an Event of Default arising from the non-payment of principal, interest, or fees when due (a "Payment Default"), or (ii) an Event of Default arising from a Bankruptcy Event (as defined in the definitive Credit Agreement).
(b) The Default Rate shall not apply automatically. Application of the Default Rate shall require written notice from the Administrative Agent (acting at the direction of the Required Lenders) to the Borrower specifying the Event of Default giving rise to the Default Rate. The Default Rate shall accrue from the date such notice is delivered (or, in the case of a Bankruptcy Event, from the date of such event) until such Event of Default is cured or waived.
The foregoing limitations on the applicability of the Default Rate reflect the Borrower's position; the Brindoval initial draft provided for automatic application of the Default Rate upon the occurrence of any Event of Default.
4.3 Interest Payment Dates
Interest on the Term Loans shall be payable in arrears on the last business day of each interest period and, in the case of any interest period exceeding three (3) months, on each date that is three months after the commencement of such interest period and on the last business day of such interest period. All interest shall also be payable upon any prepayment (with respect to the principal amount prepaid) and at maturity.
4.4 Day Count / Computation
All interest calculations shall be computed on the basis of the actual number of days elapsed over a 360-day year (Actual/360).
SECTION 5: FEES
5.1 Arrangement Fee
An arrangement fee in an amount equal to 1.50% of the total Facility amount ($200,000,000 × 1.50% = $3,000,000) shall be payable to the Lead Arranger on the Closing Date, in immediately available funds. The arrangement fee shall be fully earned upon payment and shall not be refundable under any circumstances.
5.2 Structuring Fee
A structuring fee of $500,000 (flat) shall be payable to Brindoval National Bank, N.A. on the Closing Date, in immediately available funds. The structuring fee shall be fully earned upon payment and shall not be refundable under any circumstances.
5.3 Original Issue discount (OID)
The Term Loans shall be issued at an original issue discount of 2.00% of the aggregate principal amount of the Term Loans ($200,000,000 × 2.00% = $4,000,000). Accordingly, the net proceeds to the Borrower on the Closing Date shall be $196,000,000. The Borrower shall be obligated to repay the full $200,000,000 principal amount of the Term Loans notwithstanding the OID. The OID shall be deemed "interest" for purposes of the definitive Credit Agreement.
5.4 Administrative Agent Fee
An annual administrative agent fee shall be payable to Brindoval National Bank, N.A., in its capacity as Administrative Agent, in the amount and at the times set forth in a separate fee letter between the Borrower and the Administrative Agent (the "Agent Fee Letter"). The terms of the Agent Fee Letter are confidential and shall not be shared with or disclosed to any Lender or prospective Lender, except as expressly permitted therein.
5.5 Undrawn Commitment Fee
In the event that a delayed draw tranche is added to the Facility (whether pursuant to the market flex provisions set forth in Section 16 or otherwise), an undrawn commitment fee of 0.50% per annum shall be payable on unfunded commitments under such delayed draw tranche, calculated on an Actual/360 basis and payable quarterly in arrears. No undrawn commitment fee shall be applicable to the Term Loans described herein, which shall be fully drawn on the Closing Date.
SECTION 6: AMORTIZATION
The Term Loans shall amortize in equal quarterly installments in an aggregate annual amount equal to 1.0% of the original principal amount of the Term Loans ($200,000,000 × 1.0% = $2,000,000 per annum), with each quarterly installment in the amount of $500,000. Quarterly amortization payments shall be due and payable on the last business day of each fiscal quarter, commencing with the first full fiscal quarter ending after the Closing Date.
The remaining outstanding principal balance of the Term Loans, together with all accrued and unpaid interest and other amounts owing under the Facility, shall be due and payable in full on the Maturity Date.
The following table illustrates the indicative amortization schedule, assuming a Closing Date of June 30, 2026:
The amortization schedule is presented for illustrative purposes only and does not reflect the effect of any voluntary or mandatory prepayments, which would reduce the outstanding balance and adjust remaining scheduled payments in accordance with Section 7.3.
SECTION 7: PREPAYMENTS
7.1 Voluntary Prepayments
The Borrower may voluntarily prepay the Term Loans, in whole or in part, at any time and from time to time, subject to the following terms and conditions:
(a) Minimum Amounts. Each voluntary prepayment shall be in a minimum principal amount of $1,000,000 and in integral multiples of $500,000 in excess thereof (or, if less, the entire remaining outstanding principal balance of the Term Loans). The minimum prepayment amount and integral multiple set forth herein reflect the Borrower's markup; the Brindoval initial draft specified a minimum of $5,000,000 and integral multiples of $1,000,000.
(b) Call Protection. If a voluntary prepayment is made during the first twelve (12) months following the Closing Date, such prepayment shall be accompanied by a prepayment premium equal to 1.0% of the principal amount prepaid (a "101% soft call"). After the twelve-month anniversary of the Closing Date, voluntary prepayments may be made at par, without premium or penalty of any kind.
(c) Notice. The Borrower shall provide the Administrative Agent with at least three (3) business days' prior written notice of any voluntary prepayment, specifying the date and amount of such prepayment. Any such notice may be revocable and may be conditioned upon the occurrence or non-occurrence of any event specified therein (including the closing of a refinancing transaction or other corporate transaction). The three-business-day notice period and the revocability and conditionality provisions reflect the Borrower's markup; the Brindoval initial draft required five (5) business days' irrevocable prior written notice.
Voluntary prepayments shall be applied to scheduled amortization payments in accordance with Section 7.3 below.
7.2 Mandatory Prepayments
The Borrower shall be required to make mandatory prepayments of the Term Loans in the following circumstances:
7.2.1 Asset Sales.
(a) The Borrower shall prepay the Term Loans in an amount equal to 100% of the net cash proceeds received by the Borrower or any of its subsidiaries from any asset sale or other disposition of property (other than dispositions permitted without regard to the mandatory prepayment requirement, as described below).
(b) Annual De Minimis Basket. No mandatory prepayment shall be required with respect to any fiscal year in which the aggregate net cash proceeds from all asset sales and dispositions during such fiscal year do not exceed $2,500,000. If aggregate annual net cash proceeds exceed $2,500,000, the mandatory prepayment obligation shall apply to 100% of such proceeds (not merely the excess over the de minimis threshold).
(c) Reinvestment Rights. Notwithstanding the foregoing, the Borrower shall not be required to make a mandatory prepayment with respect to net cash proceeds from any asset sale or disposition to the extent that such proceeds are reinvested (or committed to be reinvested) in assets useful in the business of the Borrower and its subsidiaries within 365 days of receipt of such proceeds; provided, further, that if such proceeds are committed to be reinvested pursuant to a binding contract entered into during such 365-day period, the Borrower shall have an additional 180 days from the date of such binding commitment (for a total of 545 days from the date of receipt) in which to complete such reinvestment. The 180-day extension period reflects the Borrower's markup; the Brindoval initial draft provided for a flat 365-day reinvestment period without any extension. Any net cash proceeds not reinvested (or committed to be reinvested) within the applicable reinvestment period shall be applied to mandatory prepayment of the Term Loans promptly following the expiration of such period.
(d) Net Cash Proceeds Definition. For purposes of this Section 7.2.1, "net cash proceeds" shall mean the cash proceeds received by the Borrower or the applicable subsidiary in connection with such asset sale or disposition, net of (i) all reasonable and customary costs and expenses incurred in connection with such sale or disposition (including legal fees, brokerage commissions, title and recording charges, and transfer taxes), (ii) all taxes paid or reasonably estimated to be payable as a result of such sale or disposition (including income taxes, capital gains taxes, and withholding taxes), (iii) all amounts required to repay any indebtedness that is secured by a Permitted Lien on the assets subject to such sale or disposition (to the extent such indebtedness is required to be repaid in connection with such sale or disposition), and (iv) reasonable reserves established in good faith for post-sale indemnification obligations, purchase price adjustments, and earnout or similar contingent payment obligations, which reserves shall be released to the mandatory prepayment sweep to the extent not applied within 12 months of the closing of such sale or disposition.
7.2.2 Debt Issuances.
(a) The Borrower shall prepay the Term Loans in an amount equal to 100% of the net cash proceeds received by the Borrower or any of its subsidiaries from any issuance of debt for borrowed money, other than Permitted Debt.
(b) Permitted Debt Exclusions. For purposes of this Section 7.2.2, "Permitted Debt" shall include customary carve-outs for (i) capital leases and purchase money indebtedness (within the basket limits set forth in Section 11.1), (ii) intercompany indebtedness among the Borrower and Guarantors on a subordinated basis, (iii) refinancing indebtedness (to the extent the principal amount thereof does not exceed the principal amount of the indebtedness being refinanced, plus premiums, accrued interest, and reasonable fees and expenses), and (iv) such other categories of Permitted Debt as are set forth in Section 11.1 below.
7.2.3 Excess Cash Flow (ECF).
(a) Commencing with the fiscal year ending December 31, 2026, and for each fiscal year thereafter, the Borrower shall prepay the Term Loans in an amount equal to the applicable ECF Percentage (as set forth below) of Excess Cash Flow for such fiscal year, less the aggregate amount of all voluntary prepayments of the Term Loans made during such fiscal year (which shall be netted against the ECF sweep obligation dollar-for-dollar). The voluntary prepayment netting feature is a critical addition in the Borrower's markup and was not included in the Brindoval initial draft.
(b) ECF Percentage Step-Downs. The applicable ECF Percentage shall be determined as follows, based on the Total Net Leverage Ratio as of the last day of such fiscal year:
(c) ECF Calculation. "Excess Cash Flow" for any fiscal year shall be calculated as follows:
Consolidated Net Income for such fiscal year,
plus depreciation, amortization, and other non-cash charges deducted in arriving at Consolidated Net Income,
minus (i) unfinanced capital expenditures actually made during such fiscal year (i.e., capital expenditures not financed with the proceeds of long-term indebtedness),
minus (ii) cash taxes actually paid during such fiscal year,
minus (iii) scheduled debt service payments (principal and interest) actually made during such fiscal year with respect to the Term Loans and any other indebtedness for borrowed money,
minus (iv) increases in working capital during such fiscal year (and plus decreases in working capital during such fiscal year), in each case calculated on a consolidated basis,
minus (v) cash restructuring charges actually paid during such fiscal year, capped at $3,000,000 per fiscal year (the inclusion of cash restructuring charges as an ECF deduction is a Borrower addition; the Brindoval initial draft did not include this item),
minus (vi) certain other customary cash charges as agreed in the definitive Credit Agreement.
(d) De Minimis Threshold. No ECF sweep payment shall be required with respect to any fiscal year if the calculated ECF sweep amount (after application of the applicable ECF Percentage and netting of voluntary prepayments) is less than $1,000,000.
(e) Timing. ECF sweep payments shall be due and payable within 10 business days after the date on which the annual audited financial statements are required to be delivered for the applicable fiscal year.
7.2.4 Extraordinary Receipts. The Borrower proposes the deletion of any separate mandatory prepayment sweep for insurance proceeds and condemnation awards. The Borrower's position is that such receipts should be addressed solely through the asset sale sweep mechanics set forth in Section 7.2.1 above, with the benefit of the reinvestment rights described therein. To the extent net cash proceeds from insurance or condemnation events are not reinvested within the applicable reinvestment period, they would be subject to mandatory prepayment as asset sale proceeds.
7.3 Application of Prepayments
Mandatory prepayments shall be applied to the remaining scheduled amortization payments of the Term Loans in inverse order of maturity (i.e., applied first to the latest maturing installments, then to the next latest maturing installments, and so on). This application methodology reflects the Borrower's markup; the Brindoval initial draft provided for application in direct order of maturity (i.e., to the nearest maturing installments first). The Borrower's position preserves near-term cash flow flexibility by reducing the balloon payment at maturity rather than accelerating short-term amortization relief.
Voluntary prepayments shall be applied to remaining scheduled amortization payments in the same manner (inverse order of maturity) unless the Borrower otherwise directs in its prepayment notice.
SECTION 8: CONDITIONS PRECEDENT TO FUNDING
8.1 Closing Conditions
The obligation of the Lenders to fund the Term Loans on the Closing Date shall be subject to the satisfaction (or waiver by the Administrative Agent and Required Lenders, as applicable, subject to Section 8.2) of each of the following conditions precedent:
(a) Definitive Documentation. The execution and delivery by all parties thereto of the definitive Credit Agreement and all ancillary loan documents contemplated thereby, including the guaranty agreements, security agreements, pledge agreements, and intercreditor agreements (if applicable), in each case in form and substance reasonably satisfactory to the Administrative Agent and the Borrower.
(b) Acquisition Closing. The closing of the Acquisition of Meridian Cloud Solutions Inc. shall occur substantially contemporaneously with the initial funding of the Term Loans, on terms and conditions consistent with the acquisition agreement (a copy of which, together with all material amendments, supplements, and side letters thereto, shall have been delivered to the Administrative Agent prior to the Closing Date). The purchase price paid in the Acquisition shall not exceed $315,000,000 (subject to customary purchase price adjustments), and the equity contribution from Fund IV shall be not less than $130,000,000.
(c) Limited Conditionality. Customary "SunGard" limited conditionality provisions shall apply with respect to the conditions precedent to funding on the Closing Date, as more fully described in Section 8.2 below.
(d) No Material Adverse Effect. No Material Adverse Effect (as defined in the acquisition agreement between the Borrower and the sellers of Meridian) shall have occurred since December 31, 2025.
(e) Specified Representations. The Specified Representations (as defined below) shall be true and correct in all material respects (or, in the case of Specified Representations that are themselves qualified by materiality or Material Adverse Effect, in all respects) as of the Closing Date. For purposes of this Term Sheet, the "Specified Representations" shall be limited to representations and warranties relating to (i) organization and existence, (ii) corporate or organizational power and authority, (iii) due authorization and execution of the loan documents, (iv) no conflict with organizational documents, (v) enforceability of the loan documents, (vi) compliance with Federal Reserve margin regulations (Regulations T, U, and X), (vii) Investment Company Act status, (viii) use of proceeds, (ix) solvency (after giving effect to the Transactions), and (x) compliance with the USA PATRIOT Act, OFAC sanctions, and anti-money laundering laws.
(f) Pro Forma Financial Statements. Delivery of pro forma financial statements of the Borrower and its subsidiaries (after giving effect to the Acquisition and the incurrence of the Term Loans), including a pro forma consolidated balance sheet and a pro forma consolidated income statement for the most recently completed twelve-month period, together with a pro forma compliance certificate demonstrating compliance with the financial covenant set forth in Section 12.1 on a pro forma basis as of the Closing Date.
(g) Governmental and Third-Party Approvals. Receipt of all required governmental approvals, licenses, and permits, and all required third-party consents, in each case as are necessary for the consummation of the Acquisition and the transactions contemplated by the loan documents, including (without limitation) any required approvals under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and any applicable foreign antitrust or competition laws.
(h) Insurance. Evidence of insurance coverage reasonably satisfactory to the Administrative Agent, including (i) property and casualty insurance, (ii) commercial general liability insurance, (iii) cyber liability insurance, (iv) directors' and officers' liability insurance, and (v) representations and warranties insurance from Northvane Insurance Group Inc. (or another nationally recognized insurance carrier reasonably acceptable to the Administrative Agent) with respect to the Acquisition. All insurance policies required to name the Administrative Agent as loss payee or additional insured (as applicable) shall include endorsements to such effect.
(i) Fees and Expenses. Payment of all fees and expenses due and payable on the Closing Date, including the arrangement fee (Section 5.1), the structuring fee (Section 5.2), the OID (Section 5.3), the Administrative Agent fee (Section 5.4), and all reasonable and documented out-of-pocket expenses of the Administrative Agent (including the fees of Broadwick & Thayer LLP as counsel to the Agent), in each case to the extent invoiced at least two (2) business days prior to the Closing Date.
(j) Legal Opinions. Delivery of customary legal opinions from (i) Calderwood & Harkness LLP, as counsel to the Borrower and the Sponsor, and (ii) if applicable, local counsel in jurisdictions where local law opinions are customary or required, in each case in form and substance reasonably satisfactory to the Administrative Agent and its counsel.
(k) Organizational Documents. Delivery of certified copies of the organizational documents (certificates of formation, limited liability company agreements, certificates of incorporation, bylaws, or partnership agreements, as applicable) of the Borrower, Meridian, and each Guarantor, together with resolutions or written consents authorizing the execution, delivery, and performance of the loan documents, incumbency certificates identifying the officers or authorized signatories of each such entity, and certificates of good standing (or equivalent) from the applicable Secretary of State or other governmental authority in the jurisdiction of organization of each such entity, dated not more than 30 days prior to the Closing Date.
(l) Lien Searches and UCC Filings. Completion of UCC, tax lien, judgment lien, and litigation searches in the jurisdictions of organization and principal place of business of the Borrower, Meridian, and each Guarantor, the results of which shall be reasonably satisfactory to the Administrative Agent (reflecting no liens other than Permitted Liens or liens to be discharged at or prior to closing). Filing of UCC-1 financing statements with the Delaware Secretary of State naming each of the Borrower and Meridian as debtor, and such other filings as are necessary to perfect the Administrative Agent's security interest in the Collateral.
(m) Solvency Certificate. Delivery of a solvency certificate from the chief financial officer (or equivalent officer) of the Borrower, in form and substance reasonably satisfactory to the Administrative Agent, certifying that, after giving effect to the Acquisition, the incurrence of the Term Loans, and the other transactions contemplated hereby, the Borrower and its subsidiaries, on a consolidated basis, are Solvent (as defined therein).
8.2 Certain Funds / Limited Conditionality
Consistent with "SunGard" certain funds principles applicable to sponsor-backed acquisition financings, the only representations the accuracy of which shall be a condition to funding on the Closing Date shall be the Specified Representations enumerated in Section 8.1(e) above. All other representations and warranties set forth in the Credit Agreement shall be made by the Borrower on the Closing Date, but the inaccuracy of any such representation or warranty (other than a Specified Representation) shall not, in and of itself, constitute a failure of a condition precedent to funding, subject to the condition that no Material Adverse Effect shall have occurred as provided in Section 8.1(d). This limited conditionality framework is intended to ensure deal certainty for the Borrower and the Sponsor in the context of the Acquisition and is consistent with market practice for leveraged acquisition financings.
For the avoidance of doubt, the limited conditionality provisions shall not limit the Lenders' rights and remedies after the Closing Date with respect to any breach of representations and warranties, which shall constitute an Event of Default as and to the extent set forth in Section 13.
SECTION 9: REPRESENTATIONS AND WARRANTIES
The Credit Agreement shall contain representations and warranties customary for sponsor-backed leveraged acquisition financings of this nature, including the following:
(a) Organization, existence, and good standing of the Borrower, Meridian, and each Guarantor in their respective jurisdictions of organization, and qualification to do business in each other jurisdiction where the failure to be so qualified could reasonably be expected to have a Material Adverse Effect.
(b) Corporate or organizational power and authority to execute, deliver, and perform the loan documents and to consummate the transactions contemplated thereby.
(c) Due authorization of the execution, delivery, and performance of the loan documents, including all necessary corporate, partnership, or limited liability company action.
(d) Enforceability of the loan documents as the legal, valid, and binding obligations of each loan party, enforceable in accordance with their respective terms (subject to customary enforceability exceptions for bankruptcy, insolvency, and equitable principles).
(e) No violation of organizational documents, applicable laws, or material agreements as a result of the execution, delivery, or performance of the loan documents.
(f) Financial statements: (i) the audited consolidated financial statements of Meridian for the fiscal years ended December 31, 2025, and December 31, 2024, audited by Whitfield & Sable LLP and accompanied by an unqualified audit opinion (without "going concern" or scope qualification), fairly present in all material respects the consolidated financial condition and results of operations of Meridian as of the dates and for the periods indicated, in accordance with GAAP consistently applied, and (ii) the pro forma financial statements delivered pursuant to Section 8.1(f) have been prepared in good faith based on reasonable assumptions and fairly present in all material respects the estimated pro forma consolidated financial condition of the Borrower and its subsidiaries.
(g) No Material Adverse Effect since December 31, 2025.
(h) Litigation: no material litigation, arbitration, or governmental proceeding is pending or, to the knowledge of the Borrower, threatened against the Borrower, Meridian, or any of their respective subsidiaries, other than as disclosed in writing to the Administrative Agent prior to the Closing Date.
(i) Compliance with laws, including (without limitation) ERISA, applicable environmental laws, anti-corruption laws (including the Foreign Corrupt Practices Act and the UK Bribery Act), sanctions laws and regulations administered by OFAC, and anti-money laundering laws (including the USA PATRIOT Act).
(j) Tax matters: all material tax returns have been timely filed and all material taxes have been paid, except to the extent contested in good faith by appropriate proceedings and for which adequate reserves have been established in accordance with GAAP.
(k) Ownership of properties; intellectual property: the Borrower and its subsidiaries have good and marketable title to, or valid leasehold interests in, all real and personal property material to the conduct of their businesses, free and clear of all liens other than Permitted Liens; the Borrower and its subsidiaries own or have the right to use all intellectual property material to their businesses.
(l) Insurance: all material properties and assets of the Borrower and its subsidiaries are covered by insurance policies maintained with financially sound and reputable insurers in amounts and covering risks customary for companies of similar size engaged in similar businesses.
(m) Labor matters: no material labor disputes, strikes, or work stoppages are pending or, to the knowledge of the Borrower, threatened.
(n) Solvency: after giving effect to the Transactions, the Borrower and its subsidiaries, on a consolidated basis, are Solvent.
(o) Investment Company Act: neither the Borrower nor any of its subsidiaries is or is required to be registered as an "investment company" under the Investment Company Act of 1940, as amended.
(p) Federal Reserve margin regulations: the Borrower is not engaged principally, or as one of its important activities, in the business of purchasing or carrying "margin stock" within the meaning of Regulations T, U, and X of the Board of Governors of the Federal Reserve System; no part of the proceeds of the Term Loans will be used to purchase or carry any margin stock or to extend credit to others for the purpose of purchasing or carrying any margin stock.
(q) Use of proceeds: the proceeds of the Term Loans shall be used solely for the purposes specified in Section 2.1.
(r) Accuracy of information: all written information provided by or on behalf of the Borrower to the Administrative Agent or any Lender in connection with the Facility is true, correct, and complete in all material respects as of the date furnished and does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements contained therein not materially misleading in light of the circumstances under which made.
(s) Collateral matters: upon filing of the applicable UCC-1 financing statements and other perfection actions contemplated by the security documents, the Administrative Agent shall have a first-priority perfected security interest in all Collateral, subject only to Permitted Liens.
Double-Materiality Scrape. With respect to representations and warranties that are qualified by materiality or "Material Adverse Effect" qualifiers, the Borrower's markup provides that for purposes of determining whether a breach of such a representation has occurred (including for purposes of determining the existence of an Event of Default or the satisfaction of conditions precedent), the materiality or Material Adverse Effect qualifier embedded in the representation shall apply, and no additional "in all material respects" overlay or similar duplicative materiality threshold shall be imposed. This double-materiality scrape protection is intended to prevent the imposition of a double materiality standard that would render the materiality qualifiers in the underlying representations meaningless.
SECTION 10: AFFIRMATIVE COVENANTS
The Credit Agreement shall contain affirmative covenants customary for sponsor-backed leveraged acquisition financings, including the following:
(a) Preservation of Existence and Rights. The Borrower shall, and shall cause each of its subsidiaries to, preserve and maintain its legal existence, organizational structure, rights, franchises, and privileges, except to the extent that failure to do so could not reasonably be expected to have a Material Adverse Effect.
(b) Compliance with Laws. The Borrower shall, and shall cause each of its subsidiaries to, comply with all applicable laws, rules, regulations, and orders (including environmental laws, anti-corruption laws, sanctions laws, and labor laws), except where the failure to comply could not reasonably be expected to have a Material Adverse Effect.
(c) Payment of Taxes and Obligations. The Borrower shall, and shall cause each of its subsidiaries to, pay and discharge all taxes, assessments, and governmental charges or levies when due, except to the extent contested in good faith by appropriate proceedings diligently conducted and for which adequate reserves have been established in accordance with GAAP.
(d) Maintenance of Insurance. The Borrower shall, and shall cause each of its subsidiaries to, maintain insurance with financially sound and reputable insurers, in such amounts and covering such risks as are customary for companies of similar size engaged in similar businesses, with the Administrative Agent named as loss payee and additional insured (as applicable) on all property and liability insurance policies.
(e) Maintenance of Properties and Assets. The Borrower shall, and shall cause each of its subsidiaries to, maintain all material properties, equipment, and assets in good working order and condition (ordinary wear and tear excepted), and make all necessary repairs, renewals, and replacements as are reasonably necessary to conduct their businesses.
(f) Access and Inspection Rights. The Borrower shall, and shall cause each of its subsidiaries to, permit representatives of the Administrative Agent and the Lenders to visit and inspect any of the properties, corporate books, and financial records of the Borrower and its subsidiaries, to examine and make copies of such books and records, and to discuss the affairs, finances, and accounts of the Borrower and its subsidiaries with their respective officers and independent auditors. Such access and inspection rights shall be subject to the following limitations: (i) absent an Event of Default, such visits and inspections shall be limited to once per fiscal year, (ii) all visits and inspections shall be conducted at reasonable times during normal business hours, upon reasonable prior written notice (not less than five (5) business days' notice unless an Event of Default exists), and (iii) all costs and expenses of such visits and inspections shall be borne by the Lenders (and not by the Borrower), unless an Event of Default has occurred and is continuing, in which case such costs and expenses shall be borne by the Borrower. The foregoing limitations reflect the Borrower's markup; the Brindoval initial draft did not include frequency limitations or expense allocation provisions.
(g) Use of Proceeds. The Borrower shall use the proceeds of the Term Loans solely for the purposes described in Section 2.1.
(h) Further Assurances. The Borrower shall, and shall cause each of its subsidiaries to, from time to time execute and deliver such additional instruments, documents, and agreements as the Administrative Agent may reasonably request in order to effectuate the purposes of the loan documents and to ensure that the Administrative Agent maintains a first-priority perfected security interest in the Collateral, including the execution and delivery of additional security agreements, pledge agreements, mortgages, and UCC financing statements as reasonably necessary.
(i) Post-Closing Covenants. The Borrower shall comply with the post-closing covenants and obligations set forth on Schedule E hereto, within the timeframes specified therein (generally 60–90 days following the Closing Date, as applicable). Failure to satisfy any post-closing obligation within the applicable timeframe (as the same may be extended by the Administrative Agent in its reasonable discretion) shall constitute an Event of Default.
10.1 Reporting Covenants
The Borrower shall deliver to the Administrative Agent (for distribution to the Lenders) the following financial statements, reports, certificates, and notices:
(a) Annual Audited Financial Statements. Within 120 days after the end of each fiscal year, the audited consolidated financial statements of the Borrower and its subsidiaries (or, prior to the first full fiscal year ending after the Closing Date, Meridian and its subsidiaries), consisting of a consolidated balance sheet, a consolidated income statement, a consolidated statement of cash flows, and a consolidated statement of changes in members' equity, in each case for such fiscal year, prepared in accordance with GAAP consistently applied and audited by an independent registered public accounting firm of recognized national standing (which, as of the date hereof, is Whitfield & Sable LLP). Such audited financial statements shall be accompanied by an unqualified audit opinion of such independent auditors (or an opinion without "going concern" or scope qualification or like exception).
(b) Quarterly Unaudited Financial Statements. Within 60 days after the end of each of the first three fiscal quarters of each fiscal year (i.e., other than the fourth fiscal quarter, which is covered by the annual audit), the unaudited consolidated financial statements of the Borrower and its subsidiaries, consisting of a consolidated balance sheet, a consolidated income statement, and a consolidated statement of cash flows, in each case for such fiscal quarter and for the fiscal year-to-date period then ended, prepared in accordance with GAAP consistently applied (subject to normal year-end adjustments and the absence of footnotes). Such quarterly financial statements shall be certified by the chief financial officer of the Borrower as fairly presenting in all material respects the consolidated financial condition and results of operations of the Borrower and its subsidiaries.
(c) Annual Budget. Within 60 days after the end of each fiscal year, a detailed annual operating budget for the Borrower and its subsidiaries for the succeeding fiscal year, in form and detail reasonably satisfactory to the Administrative Agent, including projected monthly revenue, EBITDA, capital expenditures, and cash flow.
(d) Monthly ARR and SaaS Metrics Reports. Within 30 days after the end of each calendar month, a report setting forth the following key performance metrics for the Borrower and its subsidiaries for such month:
(i) Annual Recurring Revenue ("ARR");
(ii) Net Revenue Retention ("NRR");
(iii) Gross and net customer churn rates;
(iv) Average Contract Value ("ACV");
(v) Customer concentration data (top 10 customers by ARR contribution).
The Borrower's markup provides that these monthly ARR and SaaS metrics reports shall be delivered for informational purposes only and shall not be subject to compliance certification requirements, financial covenant testing, or Event of Default triggers. The inaccuracy or late delivery of such reports shall not constitute an Event of Default (provided that such reports are delivered in good faith). The definitions of ARR, NRR, and related metrics shall be as determined by the Borrower in good faith, consistent with its past practices and industry convention, and shall be set forth in a schedule to the Credit Agreement. The Borrower reserves the right to modify such definitions from time to time to the extent consistent with changes in industry practice, with prior notice to the Administrative Agent.
(e) Compliance Certificates. Quarterly, within the same timeframe as the quarterly financial statements described in Section 10.1(b) above (i.e., within 60 days after the end of each fiscal quarter), a compliance certificate signed by the chief financial officer of the Borrower, (i) certifying compliance with the financial covenant set forth in Section 12.1 (to the extent tested during such fiscal quarter), (ii) setting forth a reasonably detailed calculation of the Total Net Leverage Ratio and Adjusted EBITDA as of the last day of such fiscal quarter, and (iii) certifying the absence of any Default or Event of Default (or, if a Default or Event of Default exists, specifying the nature thereof and the steps being taken or proposed to be taken to cure or remedy such Default or Event of Default).
(f) Prompt Notices. The Borrower shall deliver prompt written notice to the Administrative Agent upon obtaining knowledge of any of the following: (i) the occurrence of any Event of Default or Default, (ii) any material litigation, arbitration, or governmental proceeding commenced or threatened against the Borrower or any of its subsidiaries, (iii) any event or circumstance that has had, or could reasonably be expected to have, a Material Adverse Effect, and (iv) any ERISA event that could reasonably be expected to result in liability to the Borrower or its subsidiaries in excess of $1,000,000.
SECTION 11: NEGATIVE COVENANTS
The Credit Agreement shall contain negative covenants customary for sponsor-backed leveraged acquisition financings, including the following:
11.1 Indebtedness. The Borrower shall not, and shall not permit any of its subsidiaries to, create, incur, assume, suffer to exist, or otherwise become or remain directly or indirectly liable with respect to any indebtedness for borrowed money, except for the following categories of "Permitted Debt":
(a) Indebtedness under the Facility and the loan documents.
(b) Capital leases and purchase money indebtedness incurred to finance the acquisition of fixed or capital assets used in the ordinary course of business, in an aggregate outstanding principal amount not to exceed the greater of (x) $5,000,000 and (y) 7.5% of LTM Adjusted EBITDA at the time of incurrence. The Borrower's markup increases this basket from the greater of $3,000,000 and 5.0% of LTM Adjusted EBITDA as set forth in the Brindoval initial draft.
(c) Intercompany indebtedness among the Borrower and the Guarantors, provided that (i) any such indebtedness owed by a non-Guarantor to a Guarantor shall be subordinated in right of payment to the obligations under the Facility, and (ii) any investment by a Guarantor in a non-Guarantor represented by such indebtedness shall be permitted under Section 11.4.
(d) General permitted indebtedness in an aggregate outstanding principal amount not to exceed the greater of (x) $10,000,000 and (y) 15% of LTM Adjusted EBITDA at the time of incurrence. The Borrower's markup increases this basket from the greater of $7,500,000 and 10% of LTM Adjusted EBITDA as set forth in the Brindoval initial draft.
(e) Refinancing indebtedness (i.e., indebtedness incurred to refinance, refund, extend, renew, or replace any existing Permitted Debt), provided that the principal amount of such refinancing indebtedness does not exceed the principal amount of the indebtedness being refinanced (plus any accrued and unpaid interest, applicable premiums, and reasonable fees and expenses), the final maturity is not earlier than the maturity of the indebtedness being refinanced, and no additional liens are created.