TERM SHEET — SENIOR SECURED TERM LOAN FACILITY

TERM SHEET — SENIOR SECURED TERM LOAN FACILITY
CONFIDENTIAL — FOR DISCUSSION PURPOSES ONLY
** **
IMPORTANT NOTICE: This term sheet is for discussion purposes only and does not constitute a binding commitment to lend. The terms and conditions set forth herein are indicative only and are subject in all respects to the negotiation, execution, and delivery of definitive documentation in form and substance satisfactory to Brindoval National Bank, N.A. and its counsel. No party shall have any legal obligation or liability with respect to the transactions contemplated hereby unless and until such definitive documentation has been fully executed and delivered by all parties thereto.
This document reflects a  
Brindoval Internal Reference: CNB-TLF-2026-0389
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Section 1: Parties
1.1 Borrower.  Solara Digital Acquisition Holdings LLC, a Delaware limited liability company and newly formed wholly owned subsidiary of Solara Digital Infrastructure Fund IV LP.
Employer Identification Number (EIN): 93-4718206 (applied for; pending assignment by the Internal Revenue Service)
Delaware Secretary of State File No.: 7531209 (Certificate of Formation to be filed prior to closing)
The Borrower is being organized as a special-purpose acquisition vehicle formed solely for the purpose of consummating the acquisition described in Section 2 below and holding, directly or indirectly, 100% of the equity interests of Meridian Cloud Solutions Inc. following the closing of the acquisition. The Borrower shall have no material assets other than its direct or indirect equity interests in Meridian Cloud Solutions Inc. and no material liabilities other than those arising under the loan documents and the acquisition agreement.
1.2 Sponsor / Parent
Solara Digital Infrastructure LP, a Delaware limited partnership (the "Sponsor").
General Partner: Solara Digital GP LLC, a Delaware limited liability company
Principal Office Address: 1700 Market Street, Suite 2400, Wilmington, DE 19801
Employer Identification Number (EIN): 84-3291057
Delaware Secretary of State File No.: 7294185
The Sponsor is a private equity firm focused on digital infrastructure investments, including data center services, cloud computing platforms, and enterprise software businesses. The equity contribution for the acquisition described herein will be funded through Solara Digital Infrastructure Fund IV LP, a Delaware limited partnership and investment fund managed by the Sponsor.
1.3 Guarantors.  The following entities shall serve as Guarantors under the credit facility:
(a) Solara Digital Infrastructure LP (as sponsor guarantor, limited recourse only — the scope and limitations of the sponsor guaranty are set forth in Section 14 below);
(b) Meridian Cloud Solutions Inc. (post-closing), a Delaware corporation, as a downstream guarantor following the consummation of the acquisition;
(c) Each material domestic subsidiary of Meridian Cloud Solutions Inc., as identified and designated on or following the closing date.
1.4 Administrative Agent
Brindoval National Bank, N.A., a national banking association organized and existing under the laws of the United States.
Address: 383 Madison Avenue, 14th Floor, New York, NY 10179
Brindoval National Bank, N.A. shall serve as Administrative Agent under the credit agreement and related loan documents, with customary rights, duties, and protections afforded to administrative agents in comparable syndicated credit facilities.
1.5 Lead Arranger / Sole Bookrunner
Brindoval National Bank, N.A. shall serve as the sole Lead Arranger and Sole Bookrunner for the facility.
Coverage Banker: Thomas Wilder, Managing Director, Technology Leveraged Finance
Credit Officer: Sandra Fleischer, Senior Vice President, Credit Risk
1.6 Anticipated Syndication Participants
Brindoval National Bank, N.A. intends to syndicate a portion of the facility to the following institutions, each of which has provided a preliminary, non-binding indication of interest:
Following the completion of syndication, Brindoval National Bank, N.A. targets a post-syndication hold position of $75,000,000. The foregoing syndication allocations are indicative only and subject to change based on syndication market conditions and investor demand. Further details regarding syndication are set forth in Section 21 below.
Section 2: Transaction Overview
2.1 Purpose.  The proceeds of the Senior Secured Term Loan Facility shall be used for the following purposes:
(a) To finance, in part, the acquisition by the Borrower (directly or indirectly through one or more wholly owned subsidiaries) of 100% of the outstanding equity interests of Meridian Cloud Solutions Inc. from its existing shareholders, including:
(i) Ashford Ventures Partners LLC, holding approximately 52% of the outstanding equity interests;
(ii) Jason Tremblay, holding approximately 28% of the outstanding equity interests; and
(iii) Management and employee equity holders, holding approximately 20% of the outstanding equity interests in the aggregate.
(b) To pay transaction fees and expenses incurred in connection with the acquisition and the financing thereof, estimated at approximately $12,000,000 in the aggregate;
(c) To fund approximately $3,000,000 in cash to the consolidated balance sheet of Meridian Cloud Solutions Inc. following the closing of the acquisition.
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 purchase or carrying of any margin stock within the meaning of Regulation U of the Board of Governors of the Federal Reserve System.
2.2 Acquisition Target
Meridian Cloud Solutions Inc., a Delaware corporation.
Headquarters: 450 Technology Parkway, Suite 800, Austin, TX 78759
Delaware Secretary of State File No.: 6038472
Employer Identification Number (EIN): 82-1647530
Business Description: Meridian Cloud Solutions Inc. is a provider of cloud-native Software-as-a-Service ("SaaS") solutions serving the financial services industry. Meridian's platform provides portfolio analytics, risk reporting, investor reporting, and data aggregation tools to mid-market asset managers, registered investment advisors, and family offices. The platform is deployed on a multi-tenant cloud architecture and is sold primarily on an annual subscription basis, with pricing generally tied to assets under management or number of users.
Key Financial Metrics (LTM as of December 31, 2025):
2.3 Enterprise Value / Purchase Price
The aggregate enterprise value of Meridian Cloud Solutions Inc. for purposes of the acquisition is $315,000,000, representing a purchase price multiple of approximately 16.84x LTM Adjusted EBITDA and approximately 5.05x LTM ARR.
2.4 Sources and Uses
The acquisition and related transactions shall be funded as follows:
Sources of Funds:
Uses of Funds:
The equity contribution from Solara Digital Infrastructure Fund IV LP represents approximately 41.3% of the enterprise value of Meridian Cloud Solutions Inc., which is consistent with Brindoval's underwriting requirements for sponsor-backed acquisition financings at this leverage profile.
Management Rollover: Jason Tremblay, the co-founder and Chief Technology Officer of Meridian Cloud Solutions Inc., will roll over approximately $20,000,000 of his sale proceeds into equity of the Borrower, representing his continued commitment to the business and alignment of interests with the Sponsor and the lenders. The rollover equity shall be structured as a direct or indirect equity interest in the Borrower on terms to be set forth in the acquisition agreement and related equity documents.
2.5 Leverage Metrics at Closing
The following leverage metrics are calculated on a pro forma basis as of the anticipated closing date, giving effect to the acquisition and the incurrence of the term loan facility:
Brindoval's underwriting analysis takes into account both EBITDA-based and ARR-based leverage metrics given the recurring revenue characteristics and high-growth profile of the target. While the Debt/EBITDA leverage is elevated relative to traditional middle-market transactions, it is within market parameters for sponsor-backed SaaS acquisition financings where ARR-based leverage is the primary underwriting metric.
Section 3: Facility Terms
3.1 Facility Type
Senior Secured Term Loan Facility (the "Term Loan" or the "Facility").
3.2 Facility Amount
$200,000,000 (Two Hundred Million Dollars).
3.3 Availability.  The Term Loan shall be available in a single drawing on the closing date. No portion of the Term Loan that is repaid or prepaid may be re-borrowed.
3.4 Maturity.  The Term Loan shall mature on the date that is seven (7) years from the closing date.
Based on the targeted closing date of June 30, 2026, the anticipated maturity date would be June 30, 2033. The closing date is subject to the satisfaction or waiver of all conditions precedent set forth in Section 10 below and may be adjusted as agreed among the parties.
Section 4: Interest Rate
4.1 Applicable Rate
The Term Loan shall bear interest at a rate per annum equal to:
Adjusted Term SOFR + 475 basis points (4.75%)
where "Adjusted Term SOFR" means the forward-looking term rate based on the Secured Overnight Financing Rate published by the CME Group (or a successor administrator) for the applicable interest period, plus the SOFR Credit Spread Adjustment set forth in Section 4.3 below, subject to the SOFR Floor set forth in Section 4.2 below.
4.2 SOFR Floor
Adjusted Term SOFR (before giving effect to the Credit Spread Adjustment) shall be deemed to be not less than 1.00% per annum.
4.3 SOFR Credit Spread Adjustment
A credit spread adjustment of 10 basis points (0.10%) shall be added to the Term SOFR rate for all interest periods, in each case prior to the addition of the applicable margin. This credit spread adjustment is intended to account for the transition from LIBOR-based pricing conventions and is consistent with market conventions for term SOFR-based lending facilities.
4.4 Interest Periods
At the election of the Borrower (subject to customary procedures for selection and notice), interest periods of 1, 3, or 6 months shall be available.
Interest periods shall be subject to customary provisions regarding the availability of SOFR quotations and the treatment of interest periods that would otherwise extend beyond the maturity date.
4.5 Default Rate
Upon the occurrence and during the continuance of any Event of Default, all outstanding amounts under the Term Loan shall automatically bear interest at a rate per annum equal to an additional 2.00% above the otherwise applicable interest rate (the "Default Rate").
4.6 Day Count / Payment
Interest shall be calculated on the basis of a year of 360 days for the actual number of days elapsed (Actual/360). Interest shall be payable in arrears on the last business day of each interest period. In the case of interest periods exceeding three (3) months, interest shall also be payable on the date falling every three (3) months after the first day of such interest period and on the last business day of such interest period.
Section 5: Amortization
5.1 Scheduled Amortization
The Term Loan shall amortize at a rate of 1.0% per annum of the original principal amount of the Term Loan ($200,000,000), payable in equal quarterly installments as follows:
Quarterly Amortization Payment: $500,000
Annual Amortization: $2,000,000 ($200,000,000 × 1.0%)
Payment Dates: Last business day of each fiscal quarter, commencing with the first full fiscal quarter after the closing date
The low amortization rate is consistent with market conventions for term loan B facilities in the sponsor-backed leveraged loan market and reflects the expectation that the majority of principal repayment will be made through excess cash flow sweeps, asset sale proceeds, and the balloon payment at maturity.
5.2 Balloon Payment
The remaining outstanding principal balance of the Term Loan, together with all accrued and unpaid interest thereon and all other amounts owing under the loan documents, shall be due and payable in full on the maturity date (anticipated to be June 30, 2033).
Section 6: Voluntary Prepayment
6.1 Call Protection
Voluntary prepayments of the Term Loan made during the first twelve (12) months following the closing date shall be subject to a prepayment premium equal to 1.0% of the principal amount prepaid (i.e., a "soft call" of 101% of par).
6.2 After Call Protection Period
Following the expiration of the twelve-month soft call period described in Section 6.1 above, the Term Loan may be voluntarily prepaid, in whole or in part, at par (i.e., at 100% of the principal amount prepaid), without premium or penalty.
Voluntary prepayments after the call protection period shall be made in minimum amounts of $1,000,000 and in integral multiples of $500,000 in excess thereof.
6.3 Notice.  Voluntary prepayments shall require at least three (3) business days' prior irrevocable written notice from the Borrower to the Administrative Agent, specifying the date of prepayment and the principal amount to be prepaid.
Notices of voluntary prepayment may be conditioned upon the occurrence or non-occurrence of any event specified therein (including the closing of a refinancing transaction), and any such notice may be revoked if such condition is not satisfied.
Section 7: Mandatory Prepayments
7.1 Asset Sale Proceeds
The Borrower shall apply 100% of net cash proceeds from asset sales or other dispositions of property (whether by sale, transfer, lease, or otherwise) outside the ordinary course of business to the mandatory prepayment of the Term Loan.
Annual Basket: No mandatory prepayment shall be required with respect to asset sale proceeds received during any fiscal year to the extent the aggregate net cash proceeds from all such asset sales during such fiscal year do not exceed $2,500,000 (the "Asset Sale De Minimis Basket").
Reinvestment Rights: Notwithstanding the foregoing, the Borrower shall not be required to apply net cash proceeds from asset sales to mandatory prepayments 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. If the Borrower has entered into a binding commitment to reinvest such proceeds within the initial 365-day period, the reinvestment period shall be extended by an additional 180 days (for a total reinvestment period of 545 days from receipt). Any net cash proceeds not reinvested (or committed to be reinvested pursuant to a binding commitment) within the applicable reinvestment period shall be applied to the mandatory prepayment of the Term Loan promptly following the expiration of such period.
7.2 Debt Issuance Proceeds
The Borrower shall apply 100% of net cash proceeds from the issuance or incurrence of any indebtedness by the Borrower or any of its subsidiaries to the mandatory prepayment of the Term Loan, excluding net cash proceeds from Permitted Debt (as such term shall be defined in the definitive credit agreement). The definition of "Permitted Debt" shall include, among other customary exceptions, capital lease obligations, purchase money indebtedness, intercompany indebtedness among loan parties, and other categories to be agreed upon in the definitive credit agreement.
7.3 Excess Cash Flow Sweep
The Borrower shall apply a percentage of Excess Cash Flow ("ECF") for each fiscal year to the mandatory prepayment of the Term Loan, calculated as follows:
ECF shall be calculated annually based on the Borrower's audited consolidated financial statements for each fiscal year. The first ECF sweep calculation shall be made with respect to the fiscal year ending December 31, 2026. Each mandatory prepayment from ECF shall be due and payable within ten (10) business days following the delivery of the audited financial statements for the applicable fiscal year (or, if earlier, within ten (10) business days following the date on which such audited financial statements are required to be delivered under the reporting covenants).
Definition of Excess Cash Flow: For purposes of this term sheet, "Excess Cash Flow" shall mean, for any period, an amount equal to:
Consolidated Net Income for such period,
plus depreciation and amortization expense for such period,
minus capital expenditures made in cash during such period (including capitalized software development costs),
minus scheduled debt amortization payments made during such period,
minus increases in working capital during such period (plus decreases in working capital during such period),
subject to customary adjustments as shall be set forth in the definitive credit agreement.
The detailed definition of Excess Cash Flow, including all applicable adjustments and exclusions, shall be set forth in the definitive credit agreement.
7.4 Insurance / Condemnation Proceeds
The Borrower shall apply 100% of net cash proceeds from insurance claims or condemnation events (including any taking, seizure, or similar governmental action) to the mandatory prepayment of the Term Loan, subject to reinvestment rights on the same terms and conditions as set forth in Section 7.1 above with respect to asset sale proceeds. The Borrower shall have the right to reinvest such net cash proceeds in the restoration, repair, or replacement of the affected assets within the applicable reinvestment period (365 days, with a 180-day extension upon binding commitment), and any net cash proceeds not so reinvested within the applicable period shall be applied to the mandatory prepayment of the Term Loan.
Mandatory prepayments under this Section 7 shall be applied to outstanding principal installments of the Term Loan in inverse order of maturity (i.e., applied first to the final balloon payment and then in reverse chronological order to scheduled amortization payments), unless otherwise agreed by the Required Lenders.
Section 8: Original Issue discount
8.1 OID.  The Term Loan shall be issued at an original issue discount ("OID") of 2.00% of the aggregate principal amount of the Term Loan.
Aggregate Principal Amount: $200,000,000
OID: 2.00%
Dollar Amount of OID: $4,000,000
Net Proceeds to Borrower: $196,000,000
The OID shall be deducted from the gross proceeds of the Term Loan at the time of funding on the closing date. For the avoidance of doubt, the full principal amount of the Term Loan ($200,000,000) shall be deemed outstanding for all purposes under the credit agreement, including for purposes of calculating interest, amortization, and all other obligations thereunder.
Section 9: Fees
9.1 Arrangement Fee
An arrangement fee equal to 1.50% of the total commitment amount shall be payable to Brindoval National Bank, N.A. in its capacity as Lead Arranger and Sole Bookrunner.
Total Commitment Amount: $200,000,000
Arrangement Fee Rate: 1.50%
Dollar Amount: $3,000,000
Payment: Due and payable in full on the closing date, non-refundable and not subject to set-off or counterclaim
9.2 Structuring Fee
A flat structuring fee of $500,000 shall be payable to Brindoval National Bank, N.A. in consideration for its structuring and advisory services in connection with the facility.
Payment: Due and payable in full on the closing date, non-refundable and not subject to set-off or counterclaim
9.3 Administrative Agent Fee
An annual administrative agent fee shall be payable to Brindoval National Bank, N.A. in its capacity as Administrative Agent, in an amount to be set forth in a separate fee letter between the Borrower and the Administrative Agent.
Payment: Payable annually in advance, commencing on the closing date
9.4 Undrawn Commitment Fee
In the event that a delayed draw term loan tranche or revolving credit facility is added to the facility structure (whether pursuant to the market flex provisions in Section 16 or otherwise), an undrawn commitment fee of 0.50% per annum shall accrue on unfunded commitments under such tranche, payable quarterly in arrears.
This fee is not applicable to the initial Term Loan, which is a single-draw facility.
Section 10: Conditions Precedent to Closing
10.1 Conditions.  The obligation of the Lenders to fund the Term Loan on the closing date shall be subject to the satisfaction (or waiver by the Administrative Agent and the Required Lenders) of each of the following conditions precedent:
(a) Definitive Documentation. Execution and delivery by all parties thereto of the definitive credit agreement and all ancillary loan documents (including the security agreement, pledge agreement, guaranty agreement, intercreditor agreement (if applicable), and all related schedules and exhibits), in each case in form and substance satisfactory to the Administrative Agent and its counsel.
(b) Simultaneous Acquisition Closing. The acquisition of 100% of the outstanding equity interests of Meridian Cloud Solutions Inc. shall be consummated simultaneously with the funding of the Term Loan, on the terms described in the purchase agreement as delivered to the Administrative Agent, without any amendments, modifications, supplements, or waivers thereto that are material to the interests of the Lenders, unless such amendments, modifications, supplements, or waivers have been consented to by the Administrative Agent (such consent not to be unreasonably withheld or delayed).
(c) Customary Closing Documents. Delivery of customary closing documents, including:
(i) Certified copies of organizational documents (certificate of formation, operating agreement, certificate of incorporation, bylaws, or limited partnership agreement, as applicable) of the Borrower, Meridian, and each Guarantor;
(ii) Officer's and secretary's (or equivalent) certificates certifying the names, titles, and true signatures of the officers or authorized representatives executing the loan documents on behalf of each Loan Party;
(iii) Good standing certificates (or equivalent) from the jurisdiction of organization and each material jurisdiction of qualification of each Loan Party, dated within 10 business days of the closing date;
(iv) Opinions of legal counsel to the Borrower and the Guarantors (including opinions from Calderwood & Harkness LLP and, if applicable, local counsel) covering customary matters, including due authorization, enforceability, no conflicts, and perfection of security interests;
(d) Perfection of Security Interests. All actions necessary to create and perfect a first-priority security interest in all Collateral described in Section 11 shall have been taken, including the filing of UCC-1 financing statements, the execution and delivery of deposit account control agreements, and the filing of intellectual property security agreements with the applicable governmental offices, in each case to the satisfaction of the Administrative Agent and its counsel.
(e) No Material Adverse Effect. No Material Adverse Effect (as such term shall be defined in the credit agreement, consistent with the definition set forth in the commitment letter) shall have occurred since December 31, 2025.
(f) Accuracy of Specified Representations. The Specified Representations (as defined in Section 18.1 below) shall be true and correct in all material respects (or, in the case of Specified Representations that are qualified by materiality, in all respects) on and as of the closing date (except to the extent that such Specified Representations expressly relate to an earlier date, in which case they shall be true and correct as of such earlier date).
(g) Audited Financial Statements. Delivery to the Administrative Agent of audited consolidated financial statements of Meridian Cloud Solutions Inc. for the fiscal years ended December 31, 2024 and December 31, 2025, in each case audited by Whitfield & Sable LLP and accompanied by an unqualified audit opinion (or an opinion without a "going concern" or similar qualification or exception).
(h) Interim Financial Statements. Delivery to the Administrative Agent of unaudited interim consolidated financial statements of Meridian Cloud Solutions Inc. for the most recently completed fiscal quarter ending at least 60 days prior to the closing date.
(i) Payment of Fees and Expenses. Receipt by the Administrative Agent and the Lead Arranger of all fees and expenses owed under this term sheet, the commitment letter, and the fee letter on or prior to the closing date, including without limitation the arrangement fee, the structuring fee, the OID, and all reasonable and documented out-of-pocket legal fees and expenses of Broadwick & Thayer LLP as counsel to Brindoval National Bank, N.A.
(j) Solvency Certificate. Delivery of a solvency certificate from the Chief Financial Officer (or equivalent officer) of the Borrower or Meridian Cloud Solutions Inc. (in form reasonably satisfactory to the Administrative Agent) certifying that, after giving effect to the acquisition, the incurrence of the Term Loan, and the other transactions contemplated hereby, the Borrower and its subsidiaries, on a consolidated basis, are Solvent (as such term shall be defined in the credit agreement).
(k) Insurance. Delivery of evidence of insurance coverage (including property, casualty, liability, and business interruption insurance) maintained by Meridian Cloud Solutions Inc. and its subsidiaries in form, substance, and amounts satisfactory to the Administrative Agent, with the Administrative Agent named as loss payee or additional insured, as applicable.
(l) Funds Flow Memorandum. Delivery of a funds flow memorandum in form and substance reasonably satisfactory to the Administrative Agent, detailing the flow of all funds to be disbursed or received on the closing date.
(m) Customary "SunGard" / Limited Conditionality Provisions. The conditions precedent to funding on the closing date shall be limited to those set forth in the commitment letter and shall be consistent with "certain funds" or "SunGard" principles. Without limiting the foregoing, the Lenders shall not be entitled to impose conditions to funding beyond those specified in the commitment letter, and the only representations and warranties required to be true and correct as a condition to funding on the closing date shall be the Specified Representations (as defined in Section 18.1) and the Specified Acquisition Agreement Representations (as defined in the commitment letter).
Section 11: Collateral
11.1 Security Interest
The obligations under the credit agreement and the other loan documents shall be secured by a first-priority perfected security interest (subject only to Permitted Liens, as to be defined in the credit agreement) in substantially all assets of the Borrower, Meridian Cloud Solutions Inc., and each Guarantor (collectively, the "Collateral").
11.2 Collateral Categories
The Collateral shall include, without limitation, the following categories of assets:
(a) Equity Interests. 100% of the equity interests in the Borrower's direct and indirect domestic subsidiaries (including 100% of the equity interests in Meridian Cloud Solutions Inc.) and 65% of the voting equity interests (and 100% of the non-voting equity interests) of first-tier foreign subsidiaries of the Borrower and its domestic subsidiaries;
(b) intellectual Property. All intellectual property owned by the Borrower, Meridian, and each Guarantor, including all patents, patent applications, trademarks, trademark applications, service marks, trade names, copyrights, copyright registrations and applications, trade secrets, domain names, software (including source code and object code), and all licenses, royalties, and other rights relating thereto;
(c) Accounts Receivable. All accounts receivable (including subscription receivables, unbilled receivables, and contract assets), notes receivable, and rights to payment;
(d) Equipment. All equipment, machinery, furniture, fixtures, and other tangible personal property;
(e) Deposit Accounts. All deposit accounts (subject to the execution and delivery of deposit account control agreements as described in Section 11.5 below);
(f) Other Personal Property. All instruments, chattel paper (including electronic chattel paper), investment property, letter of credit rights, commercial tort claims (with a value in excess of a threshold to be agreed upon in the definitive credit agreement), and general intangibles (including payment intangibles and contract rights);
(g) Proceeds and Products. All proceeds and products of any and all of the foregoing Collateral, including insurance proceeds, condemnation awards, and all collections, distributions, and other payments received in respect of the foregoing.
11.3 Collateral Exclusions
(a)  
(b) Assets subject to contractual anti-assignment provisions where the consent of the counterparty has not been obtained, to the extent that the grant of a security interest therein would violate such provision and such provision is enforceable under applicable law (including after giving effect to Sections 9-406, 9-407, 9-408, and 9-409 of the Uniform Commercial Code);
(c) Equity interests in unrestricted subsidiaries (as defined in the credit agreement);
(d) Margin stock (within the meaning of Regulation U of the Board of Governors of the Federal Reserve System); and
(e) Assets to the extent that the grant of a security interest therein would result in material adverse tax consequences to the Borrower or any of its subsidiaries, as reasonably determined by the Borrower in consultation with the Administrative Agent.
11.4 UCC Filings
UCC-1 financing statements shall be filed with the Delaware Secretary of State with respect to the Borrower and Meridian Cloud Solutions Inc. (and each other Guarantor organized in Delaware). Additional UCC-1 financing statements shall be filed in each jurisdiction in which any Loan Party is organized to the extent required to perfect the security interest in the Collateral under applicable law.
Intellectual property security agreements shall be filed with the United States Patent and Trademark Office and the United States Copyright Office, as applicable, with respect to all registered patents, trademarks, and copyrights (and applications therefor) owned by the Borrower, Meridian, and each Guarantor, in each case in form and substance satisfactory to the Administrative Agent and its counsel.
11.5 Deposit Account Control Agreements
Deposit account control agreements ("DACAs") shall be executed and delivered with respect to all deposit accounts maintained by the Borrower, Meridian Cloud Solutions Inc., and each Guarantor at financial institutions other than the Administrative Agent.
The following accounts shall be excluded from the DACA requirement:
(a) Payroll accounts, to the extent used exclusively for the payment of employee wages, salaries, and related payroll obligations;
(b) Tax accounts, to the extent used exclusively for the payment of federal, state, or local taxes and related obligations; and
(c) Trust accounts and escrow accounts maintained in the ordinary course of business,
in each case, to the extent the aggregate balance of all excluded accounts does not exceed a threshold to be agreed upon in the definitive credit agreement.
Section 12: Financial Covenant
12.1 Springing Total Net Leverage Ratio
The credit agreement shall contain a single financial maintenance covenant in the form of a Maximum Total Net Leverage Ratio of 7.50x, tested as follows:
Testing Frequency: Quarterly, as of the last day of each fiscal quarter.
Springing Trigger: The financial covenant shall be tested only when any revolving credit facility (if and to the extent a revolving credit facility is added to the facility structure) is drawn in an amount greater than 35% of total revolving commitments as of the applicable testing date (excluding any letters of credit and undrawn commitments).
Definition of Total Net Leverage Ratio:
"Total Net Leverage Ratio" means, as of any date of determination, the ratio of (a) Total Funded Debt as of such date, minus Unrestricted Cash and Cash Equivalents as of such date (capped at $15,000,000 for netting purposes), to (b) Consolidated Adjusted EBITDA for the most recently completed period of four (4) consecutive fiscal quarters ending on or prior to such date.
For purposes of the financial covenant, "Total Funded Debt" and "Consolidated Adjusted EBITDA" shall have the meanings assigned to them in the definitive credit agreement.
12.2 Equity Cure Rights
(i) Frequency Limitation: Equity cures shall be limited to a maximum of 2 cures in any period of four (4) consecutive fiscal quarters, and no more than ** ** in the aggregate during the entire term of the facility.  
(ii) Application of Cure Amounts: Cure amounts contributed by the Sponsor shall be added to Consolidated Adjusted EBITDA (the denominator of the leverage ratio) for the applicable measurement period. Cure amounts shall not be applied to reduce Total Funded Debt (the numerator of the leverage ratio). This ensures that equity cures function as EBITDA supplements, which is the prevailing market convention. 
(iii) Minimum Cure Amount: Each equity cure contribution shall be in a minimum amount of $1,000,000. 
(iv) Timing: The equity cure contribution must be received by the Borrower within ** ** following the delivery of the compliance certificate for the applicable fiscal quarter demonstrating the financial covenant breach. 
(v) No Over-Cure Credit: Equity cure amounts shall only be credited in an amount sufficient to cause the Borrower to be in compliance with the financial covenant for the applicable measurement period. Any excess cure amount shall not be carried forward or applied to any subsequent period. 
The foregoing equity cure parameters remain an open issue for further negotiation, particularly with respect to the  
Section 13: EBITDA Definition and Add-Backs
13.1 Adjusted EBITDA
For purposes of this term sheet and the definitive credit agreement, "Consolidated Adjusted EBITDA" shall mean, for any measurement period, Consolidated Net Income for such period, plus (to the extent deducted in calculating Consolidated Net Income and without duplication) the sum of the following:
(a) Non-cash charges, losses, and expenses, including stock-based compensation expense, non-cash impairment charges, non-cash write-downs and write-offs, and other non-cash items reducing Consolidated Net Income for such period (excluding any non-cash charge that represents an accrual or reserve for a cash expenditure in a future period);
(b) Transaction fees and expenses incurred in connection with the acquisition, the Term Loan facility, and any permitted acquisitions (including investment banking fees, legal fees, accounting fees, due diligence expenses, and other advisory and professional fees);
(c) Restructuring charges and business optimization expenses, including severance costs, facility closure costs, relocation expenses, integration costs, and costs associated with operational restructuring or efficiency initiatives;
(d) Non-recurring charges, losses, and expenses, including litigation settlement costs, extraordinary losses, and other unusual or infrequent items that are not expected to recur in the ordinary course of business;
(e) Pro forma cost savings, synergies, and operating improvements that are projected to be realized within 18 months of the applicable action giving rise to such cost savings, synergies, or improvements, to the extent that such cost savings, synergies, and improvements are reasonably identifiable, factually supportable, and quantifiable in good faith by the management of the Borrower. Such pro forma adjustments may be given effect as if they had been fully realized on the first day of the applicable measurement period; and
(f) Run-rate revenue adjustments for new customer contracts that have been signed and executed but that have not yet commenced generating revenue during the applicable measurement period, calculated on a fully annualized basis consistent with the expected revenue to be recognized under such contracts in accordance with GAAP.
Minus (to the extent included in calculating Consolidated Net Income) any non-cash gains, non-cash income, and other non-cash items increasing Consolidated Net Income for such period (excluding any non-cash item that represents the reversal of an accrual or cash reserve for a future cash receipt or accrual of revenue in the ordinary course of business).
13.2 EBITDA Add-Back Cap
13.3 Pro Forma Adjustments
Pro forma effect shall be given to permitted acquisitions and dispositions (including the acquisition of Meridian Cloud Solutions Inc.) as if they had occurred on the first day of the applicable four-quarter measurement period. Pro forma adjustments shall include the historical financial results of any acquired entity, adjusted for any cost savings, synergies, or operating improvements that are projected to be realized within the applicable time periods, subject to the add-back cap described in Section 13.2 above.
Section 14: Sponsor Guaranty
14.1 Guarantor.  Solara Digital Infrastructure LP shall provide a limited recourse guaranty in favor of the Administrative Agent and the Lenders with respect to certain specified obligations of the Borrower and the other Loan Parties (the "Sponsor Guaranty").
14.2 Scope of Guaranteed Obligations
The Sponsor Guaranty shall be limited in scope to losses, liabilities, damages, and expenses arising from or relating to the following categories of obligations (the "Guaranteed Obligations"):
(a) Fraud, willful misconduct, or gross negligence by the Borrower, any Guarantor, or any of their respective officers, directors, managers, or authorized representatives;
(b) Breaches of specified environmental representations made by the Borrower or any Guarantor in the credit agreement or the other loan documents;
(c) Misapplication of Collateral proceeds, including the diversion or misappropriation of proceeds of Collateral in violation of the loan documents;
(d) Unpaid taxes, including any federal, state, or local taxes, assessments, or governmental charges that are required to be paid by the Borrower or any of its subsidiaries and that, if left unpaid, would give rise to a lien on the Collateral that is senior in priority to the lien of the Administrative Agent; and
(e) Specified indemnification obligations relating to environmental liabilities, including obligations arising under applicable environmental laws (including CERCLA, RCRA, and state equivalents) in respect of contamination or environmental conditions at, on, under, or migrating from any real property owned, leased, or operated by the Borrower or any of its subsidiaries.
14.3 Cap on Sponsor Guaranty
The maximum aggregate liability of the Sponsor under the Sponsor Guaranty shall be subject to a dollar cap to be agreed upon in the definitive documentation.
Borrower's Position: Cap at  
**Brindoval's  : Cap at $30,000,000** (approximately 15% of the facility amount)
Section 15: Negative Covenants
15.1 General.  The credit agreement shall contain negative covenants customary for sponsor-backed SaaS acquisition financing transactions, restricting the Borrower and its subsidiaries from engaging in certain actions without the prior consent of the Required Lenders (or, in certain cases, the Administrative Agent), subject to customary baskets, thresholds, and exceptions as shall be set forth in the definitive credit agreement.
15.2 Indebtedness.  The Borrower and its subsidiaries shall not create, incur, assume, or permit to exist any indebtedness, except for Permitted Indebtedness as shall be defined in the credit agreement. Permitted Indebtedness shall include, among other customary exceptions, (a) indebtedness under the credit agreement, (b) intercompany indebtedness among Loan Parties, (c) capital lease obligations and purchase money indebtedness, (d) existing indebtedness identified on a schedule to the credit agreement, and (e) a general permitted indebtedness basket.
15.3 Liens.  The Borrower and its subsidiaries shall not create, incur, assume, or permit to exist any lien on any property or asset, except for Permitted Liens as shall be defined in the credit agreement. Permitted Liens shall include standard carve-outs for:
(a) Liens securing indebtedness under the credit agreement;
(b) Purchase money liens and capital lease liens, in each case securing the purchase price or financing cost of the asset subject thereto;
(c) Liens arising by operation of law (including statutory liens for taxes, mechanics' liens, landlords' liens, and other similar liens);
(d) Liens existing on the closing date and identified on a schedule to the credit agreement;
(e) Liens securing Permitted Indebtedness up to the applicable basket amounts; and
(f) Other customary exceptions to be agreed upon in the definitive credit agreement.
15.4 Restricted Payments
The Borrower and its subsidiaries shall not declare, make, or pay any dividends, distributions, or other restricted payments (including redemptions, repurchases, or retirements of equity interests) to equity holders, except as permitted under the credit agreement.
A "builder basket" mechanism shall be included in the credit agreement to permit restricted payments subject to the following parameters (to be finalized in the definitive documentation):
Starting amount: ** **;
Builder component: Plus 50% of cumulative Consolidated Net Income  beginning with the  ;
Pro forma leverage test: Any restricted payment made utilizing the builder basket shall be subject to a pro forma **Total Net Leverage Ratio test of ≤  ** after giving effect to such restricted payment;
15.5 Investments.  The Borrower and its subsidiaries shall not make any investments (including acquisitions, loans, advances, capital contributions, and guarantees), except for Permitted Investments as shall be defined in the credit agreement.
15.6 Asset Sales
The Borrower and its subsidiaries shall not sell, transfer, lease, or otherwise dispose of any property or assets outside the ordinary course of business, except as permitted under the credit agreement and subject to the mandatory prepayment provisions and reinvestment rights set forth in Section 7.1 above.
15.7 Affiliate Transactions
The Borrower and its subsidiaries shall not enter into or permit to exist any transaction or series of transactions with any affiliate (other than the Borrower and its wholly owned subsidiaries), except upon terms that are not materially less favorable to the Borrower or such subsidiary than those that would be obtained in a comparable arm's-length transaction with a person that is not an affiliate.
Management fee subordination provisions shall apply to any management, advisory, monitoring, or similar fees paid by the Borrower or any of its subsidiaries to the Sponsor or any of its affiliates. Such fees shall be subordinated to the obligations under the credit agreement in accordance with customary subordination terms to be set forth in the definitive credit agreement.
15.8 Fundamental Changes
The Borrower and its subsidiaries shall not merge or consolidate with or into any other person, or dissolve, liquidate, or wind up its affairs, except for (a) mergers of wholly owned subsidiaries into the Borrower or another wholly owned subsidiary (provided that, in the case of any such merger, a Loan Party shall be the surviving entity), (b) dissolutions of dormant or inactive subsidiaries in the ordinary course of business, and (c) other customary permitted exceptions to be agreed upon in the definitive credit agreement.
15.9 Restrictive Agreements
The Borrower and its subsidiaries shall not enter into or permit to exist any contractual obligation that restricts or limits the ability of any subsidiary to (a) make dividends, distributions, or other payments to the Borrower or any other Loan Party, (b) make loans or advances to the Borrower or any other Loan Party, or (c) create liens on its property in favor of the Administrative Agent and the Lenders, in each case except for restrictions imposed by the loan documents, applicable law, or customary exceptions to be agreed upon in the definitive credit agreement.
Section 16: Market Flex Provisions
Pursuant to the terms of the commitment letter (and subject to the limitations set forth therein), Brindoval National Bank, N.A., in its capacity as Lead Arranger and Sole Bookrunner, retains the right to adjust the pricing, structure, and terms of the Term Loan facility in order to facilitate a successful syndication of the facility to third-party lenders (the "Market Flex"). The Market Flex provisions shall include the following:
(a) Spread Flex: Brindoval may increase the applicable margin by up to **+  basis points** (from SOFR + 475 bps to a maximum of SOFR +   bps);
(b) OID Flex: Brindoval may increase the original issue discount by up to an additional **  basis points** (from 2.00% to a maximum of  );
(c) Structural Modifications: Brindoval may implement structural modifications to the facility, including the right to add a revolving credit facility tranche, modify the amortization schedule, adjust the mandatory prepayment provisions, or make other structural changes reasonably necessary to facilitate syndication.
The exercise of Market Flex shall be at Brindoval's sole discretion, subject to consultation with the Borrower and the Sponsor in good faith. Any exercise of Market Flex shall be communicated to the Borrower in writing prior to the commencement of general syndication.
Section 17: Reporting Covenants
17.1 Annual Audited Financial Statements
The Borrower shall deliver to the Administrative Agent (for distribution to the Lenders) audited consolidated financial statements of the Borrower and its subsidiaries for each fiscal year, within 120 days of the end of such fiscal year. Such financial statements shall include a consolidated balance sheet, consolidated statements of income, cash flows, and changes in members' equity, and shall be audited by a nationally or regionally recognized independent registered public accounting firm (which, as of the date hereof, is Whitfield & Sable LLP). The auditor's report shall be unqualified and shall not contain any "going concern" or similar qualification, exception, or explanatory paragraph (except as may relate to the upcoming maturity of the facility within the next twelve months).
17.2 Quarterly Unaudited Financial Statements
The Borrower shall deliver to the Administrative Agent (for distribution to the Lenders) unaudited consolidated financial statements of the Borrower and its subsidiaries for each of the first three fiscal quarters of each fiscal year, within 60 days of the end of such fiscal quarter. Such quarterly financial statements shall include a consolidated balance sheet and consolidated statements of income and cash flows. The quarterly financial statements shall be certified by the Chief Financial Officer of the Borrower or Meridian Cloud Solutions Inc. as presenting fairly, in all material respects, the financial condition and results of operations of the Borrower and its subsidiaries in accordance with GAAP (subject to normal year-end adjustments and the absence of footnotes).
17.3 Annual Budget
The Borrower shall deliver to the Administrative Agent, within 60 days of the end of each fiscal year, a detailed consolidated budget for the following fiscal year (the "Annual Budget"), in form and detail reasonably satisfactory to the Administrative Agent. The Annual Budget shall include, at a minimum, projected monthly revenue, expense, capital expenditure, and cash flow figures, together with key assumptions underlying such projections. The Borrower shall promptly notify the Administrative Agent of any material deviations from the Annual Budget as they become known.
17.4 Monthly ARR and SaaS Metrics Report
The Borrower shall deliver to the Administrative Agent, within 30 days of the end of each calendar month, a report containing the following SaaS operating metrics (the "Monthly SaaS Metrics Report"):
(a) Annual Recurring Revenue (ARR): The annualized value of all active subscription contracts as of the last day of such calendar month;
(b) Net Revenue Retention Rate: The percentage of ARR retained from the prior-year customer cohort, including expansion revenue and net of contraction and churn;
(c) Gross Customer Churn Rate: The percentage of customers that terminated or did not renew their subscriptions during such calendar month (annualized);
(d) Net Customer Churn Rate (Dollar-Based): The net change in ARR from the existing customer base (excluding new customer ARR) during such calendar month, expressed as a percentage of beginning-of-period ARR (annualized);
(e) Number of Customers: The total number of active customers as of the last day of such calendar month;
(f) Average Contract Value (ACV): The average annualized contract value per customer as of the last day of such calendar month;
(g) Customer Concentration Data: A summary of the top 10 and top 20 customers by ARR, including each customer's ARR, percentage of total ARR, contract expiration date, and renewal status; and
(h) Logo Churn: The number of customers lost (i.e., customers whose subscriptions were terminated, cancelled, or not renewed) during such calendar month.
17.5 Compliance Certificate
The Borrower shall deliver to the Administrative Agent, concurrently with the delivery of the annual and quarterly financial statements described in Sections 17.1 and 17.2 above, a compliance certificate signed by the Chief Financial Officer of the Borrower or Meridian Cloud Solutions Inc. (the "Compliance Certificate"). Each Compliance Certificate shall:
(a) Certify compliance with the financial covenant set forth in Section 12.1 above (to the extent such financial covenant is required to be tested as of the applicable testing date);
(b) Certify the absence of any Default or Event of Default, or, if any Default or Event of Default exists, specify the nature and extent thereof and the actions being taken or proposed to be taken with respect thereto; and
(c) Set forth reasonably detailed calculations demonstrating the Borrower's compliance (or non-compliance) with the Total Net Leverage Ratio, including the components of Total Funded Debt, Unrestricted Cash and Cash Equivalents, and Consolidated Adjusted EBITDA.
17.6 Additional Information
The Administrative Agent may, from time to time, reasonably request additional information regarding the business, financial condition, operations, assets, or liabilities of the Borrower and its subsidiaries, and the Borrower shall provide such information within a commercially reasonable time period. Such additional information requests shall be made in good faith and shall not be unduly burdensome to the Borrower.
Section 18: Representations and Warranties
The credit agreement shall contain customary representations and warranties to be made by the Borrower and each Guarantor on the closing date and, to the extent specified in the credit agreement, on the date of each subsequent delivery of financial statements or other reports. The representations and warranties shall include, without limitation, the following:
(a) Existence, Good Standing, and Power. Each Loan Party is duly organized, validly existing, and in good standing under the laws of its jurisdiction of organization and has all requisite power and authority to own its properties and conduct its business as presently conducted.
(b) Authorization; No Conflicts. The execution, delivery, and performance of the loan documents have been duly authorized by all necessary corporate, limited liability company, or partnership action, and do not conflict with any law, regulation, organizational document, or material agreement.
(c) Enforceability of Loan Documents. The loan documents constitute the legal, valid, and binding obligations of each Loan Party, enforceable in accordance with their terms, subject to customary enforceability exceptions (bankruptcy, insolvency, and equitable principles).
(d) Financial Statements; No Material Adverse Effect. The financial statements delivered to the Lenders present fairly, in all material respects, the financial condition and results of operations of the Borrower and its subsidiaries. Since the most recent financial statements delivered, no Material Adverse Effect has occurred.
(e) Litigation. There is no pending or, to the knowledge of the Borrower, threatened litigation, arbitration, or governmental proceeding that could reasonably be expected to have a Material Adverse Effect.
(f) Compliance with Laws. Each Loan Party is in compliance with all applicable laws, regulations, and orders, including ERISA, environmental laws, anti-corruption laws (including the Foreign Corrupt Practices Act), and sanctions laws (including OFAC regulations).
(g) Tax Matters. Each Loan Party has filed all tax returns required to be filed and has paid all taxes due and payable, except where the failure to do so would not reasonably be expected to have a Material Adverse Effect.
(h) intellectual Property. Each Loan Party owns or has valid licenses to use all intellectual property necessary for the conduct of its business. No Loan Party has received any written claim of infringement, misappropriation, or other violation of the intellectual property rights of any third party that could reasonably be expected to have a Material Adverse Effect.
(i) Insurance. Each Loan Party maintains insurance coverage in amounts and with carriers as required by the credit agreement.
(j) Solvency. After giving effect to the acquisition, the incurrence of the Term Loan, and the other transactions contemplated by the loan documents, the Borrower and its subsidiaries, on a consolidated basis, are Solvent.
(k) Accuracy of Information. All written information (other than projections, forward-looking statements, and information of a general economic or industry-specific nature) provided by or on behalf of the Borrower to the Administrative Agent or the Lenders in connection with the facility is true and correct in all material respects and does not contain any material misstatement of fact or omit any material fact necessary to make the statements contained therein not misleading in light of the circumstances under which they were made.
(l) Collateral Matters. The security agreements and other collateral documents create valid and perfected first-priority liens on the Collateral (subject only to Permitted Liens).
(m) Beneficial Ownership Certification. The beneficial ownership information provided by the Borrower is true and correct in all material respects.
(n) Investment Company Act. No Loan Party is an "investment company" or a company "controlled" by an "investment company" within the meaning of the Investment Company Act of 1940, as amended.
(o) Use of Proceeds. The proceeds of the Term Loan will be used solely for the purposes set forth in Section 2.1 above. No portion of the proceeds will be used, directly or indirectly, to purchase or carry any "margin stock" within the meaning of Regulation U of the Board of Governors of the Federal Reserve System.
18.1 Specified Representations
For purposes of the closing conditionality provisions described in Section 10 above, "Specified Representations" shall be limited to the following representations and warranties:
(i) Existence;
(ii) Authorization; no conflicts with organizational documents;
(iii) Enforceability of loan documents;
(iv) Solvency (after giving effect to the transactions);
(v) Use of proceeds (including compliance with Federal Reserve margin regulations);
(vi) Investment Company Act;
(vii) OFAC / sanctions / anti-corruption compliance.
Section 19: Events of Default
The credit agreement shall contain customary events of default, including without limitation the following:
(a) Non-Payment. Failure to pay (i) any principal of the Term Loan when due (no grace period), (ii) any interest on the Term Loan within five (5) business days after the date when due, or (iii) any fee or other amount payable under the loan documents within five (5) business days after the date when due;
(b) Cross-Default / Cross-Acceleration. Default or acceleration of any other indebtedness of the Borrower or any of its subsidiaries in an aggregate principal amount exceeding **$ ** (the "Cross-Default Threshold");
(c) Breach of Representations and Warranties. Any representation or warranty made by any Loan Party in the loan documents shall be materially incorrect when made or deemed made, and such breach shall not have been cured within 30 days after notice thereof (to the extent capable of cure);
(d) Covenant Defaults. Failure to comply with any covenant contained in the credit agreement, subject to a 30-day cure period for breaches of certain affirmative covenants (other than payment obligations and the financial covenant, for which no cure period shall apply, subject to the equity cure provisions set forth in Section 12.2 above);
(e) Bankruptcy / Insolvency. The commencement of any bankruptcy, insolvency, receivership, or similar proceeding by or against the Borrower or any material subsidiary, or the making of any general assignment for the benefit of creditors;
(f) Judgments. Entry of one or more final, non-appealable judgments against the Borrower or any of its subsidiaries in an aggregate amount exceeding **$ **, to the extent not covered by insurance or indemnification by a creditworthy third party;
(g) ERISA Events. The occurrence of any ERISA Event (as defined in the credit agreement) that, individually or in the aggregate, could reasonably be expected to result in liability to the Borrower and its subsidiaries in an aggregate amount exceeding $5,000,000;
(h) Change of Control. The occurrence of a Change of Control (as defined in the credit agreement, to include (i) the Sponsor ceasing to hold, directly or indirectly, at least a majority of the economic and voting interests in the Borrower, (ii) the Borrower ceasing to own 100% of the equity interests in Meridian, and (iii) any other customary change of control triggers to be agreed);
(i) Invalidity of Loan Documents or Security Interests. Any loan document or any material provision thereof ceases to be in full force and effect, or any security interest created under the loan documents ceases to be a valid, enforceable, and perfected first-priority lien on the Collateral (subject to Permitted Liens).
Upon the occurrence and during the continuance of an Event of Default, the Administrative Agent (acting at the direction of the Required Lenders) may (and, upon the direction of the Required Lenders, shall) declare all outstanding amounts under the credit agreement immediately due and payable, exercise remedies under the security documents, and take such other actions as may be available under the loan documents and applicable law. In the case of a bankruptcy or insolvency Event of Default, all outstanding amounts shall become automatically due and payable without any declaration or other act by the Administrative Agent or any Lender.
Section 20: Assignments and Participations
20.1 Lender Assignments
Each Lender may assign all or a portion of its rights and obligations under the credit agreement to one or more assignees, subject to the following conditions:
(a) Borrower Consent. Assignments shall require the prior written consent of the Borrower (such consent not to be unreasonably withheld, conditioned, or delayed), provided that the Borrower's consent shall not be required for assignments (i) made during the continuance of an Event of Default, (ii) made to another Lender, an affiliate of a Lender, or an approved fund (i.e., a fund managed or advised by a Lender or an affiliate of a Lender), or (iii) in connection with the initial syndication of the facility. If the Borrower has not