WRITTEN CONSENT OF THE SOLE STOCKHOLDER OF STRATOS MERGER SUB INC. IN LIEU OF A SPECIAL MEETING
January 22, 2024
Action taken by written consent pursuant to Section 228 of the Delaware General Corporation Law
The undersigned, Solara Digital Infrastructure Fund VI LP, a Delaware limited partnership (EIN 87-4523190) ("Fund VI" or the "Sole Stockholder"), being the sole stockholder of Stratos Merger Sub Inc., a Delaware corporation (DE File No. 7923841) (the "Company" or "Merger Sub"), with its registered office located at 1209 Orange Street, Wilmington, Delaware 19801, and holding all of the issued and outstanding shares of capital stock of the Company, hereby takes the following actions by written consent in lieu of a special meeting of the stockholders of the Company, pursuant to Section 228 of the Delaware General Corporation Law (the "DGCL") and in accordance with the Certificate of Incorporation and the Bylaws of the Company, each as currently in effect. Capitalized terms used but not otherwise defined herein shall have the meanings ascribed to such terms in the Merger Agreement (as defined below).
The Sole Stockholder hereby acknowledges that Fund VI holds one hundred percent (100%) of all of the issued and outstanding shares of capital stock of the Company and that, accordingly, the Sole Stockholder possesses the requisite voting power to approve and adopt any matter requiring the affirmative vote or written consent of the stockholders of the Company under the DGCL, the Certificate of Incorporation, or the Bylaws of the Company.
RECITALS
WHEREAS, the Company was incorporated in the State of Delaware on January 8, 2024, solely for the purpose of effectuating the merger contemplated by the Merger Agreement (as defined below), and the Company has conducted no business activities and has no assets, liabilities, or operations other than those incident to its formation and the transactions contemplated by the Merger Agreement;
WHEREAS, the board of directors of the Company (the "Board") has approved and declared advisable that certain Agreement and Plan of Merger (the "Merger Agreement"), to be entered into among Cloudium Technologies plc, a public limited company incorporated under the laws of England and Wales (Company No. 09734521) ("Cloudium"), Stratos Merger Sub Inc., and Solara Digital Infrastructure Fund VI LP, pursuant to which, among other things, the Company will merge with and into Cloudium (the "Merger"), with Cloudium surviving the Merger as a wholly owned subsidiary of Fund VI;
WHEREAS, the Merger is structured as a reverse triangular merger under the DGCL, whereby the Company will merge with and into Cloudium, and each share of common stock, par value $0.01 per share, of Cloudium (Nasdaq: CLDM) issued and outstanding immediately prior to the effective time of the Merger (other than (a) shares held by stockholders who have entered into rollover agreements with Fund VI and who have not withdrawn or revoked such agreements, (b) shares owned by the Company, Cloudium, or any of their respective wholly owned subsidiaries, and (c) shares held by stockholders who have properly demanded and perfected appraisal rights under applicable law and have not withdrawn or lost such rights) will be converted into the right to receive Thirty-Six Dollars and Ninety-Two Cents ($36.92) per share in cash, without interest (the "Merger Consideration"), representing an aggregate equity value of approximately Six Billion Eight Hundred Million Dollars ($6,800,000,000) based on approximately 184,200,000 shares of Cloudium common stock outstanding as of the date hereof;
WHEREAS, by unanimous written consent of the Board dated January 22, 2024, the Board has: (i) determined that the Merger Agreement and the transactions contemplated thereby, including the Merger, are fair to, and in the best interests of, the Company and its sole stockholder; (ii) approved and adopted the Merger Agreement and authorized the execution, delivery, and performance by the Company of the Merger Agreement and the consummation of the transactions contemplated thereby, including the Merger; and (iii) resolved to recommend that the sole stockholder of the Company approve and adopt the Merger Agreement and the transactions contemplated thereby, including the Merger;
WHEREAS, under Section 251 of the DGCL and the Certificate of Incorporation of the Company, the approval and adoption of the Merger Agreement and the consummation of the Merger require the affirmative vote or written consent of the holders of a majority of the outstanding shares of capital stock of the Company entitled to vote thereon;
WHEREAS, Fund VI, as the sole stockholder of the Company, holds one hundred percent (100%) of the outstanding shares of capital stock of the Company and is entitled to act by written consent without a meeting of stockholders pursuant to Section 228 of the DGCL and Article VII of the Certificate of Incorporation of the Company; and
WHEREAS, in connection with the Merger Agreement, the following agreements, instruments, and documents are being executed and delivered concurrently with, or will be executed and delivered in connection with, the transactions contemplated by the Merger Agreement (collectively, the "Related Transaction Documents"):
(a) that certain Equity Commitment Letter, dated as of January 22, 2024, from Fund VI to the Company, pursuant to which Fund VI has committed to contribute or cause to be contributed to the Company equity financing in an aggregate amount of Two Billion Eight Hundred Thirty-Two Million Eight Hundred Eighty-Eight Thousand Ninety-Six Dollars ($2,832,888,096) (the "Equity Commitment Letter"), on the terms and subject to the conditions set forth therein, for the purpose of funding a portion of the aggregate Merger Consideration and related fees, costs, and expenses;
(b) that certain Limited Guarantee, dated as of January 22, 2024, by Solara Fund VI GP LLC, a Delaware limited liability company, in favor of Cloudium, pursuant to which Solara Fund VI GP LLC has guaranteed the payment obligations of Fund VI under and in connection with the Merger Agreement in an aggregate amount not to exceed Two Hundred Forty-Six Million Dollars ($246,000,000), consisting of (i) up to Two Hundred Twenty-One Million Dollars ($221,000,000) in respect of the reverse termination fee payable by the Company pursuant to Section 8.3(b) of the Merger Agreement and (ii) up to Twenty-Five Million Dollars ($25,000,000) in respect of enforcement costs and expenses (the "Limited Guarantee");
(c) that certain Debt Commitment Letter, dated as of January 22, 2024, from Meridian Atlantic Bank, N.A. and Ironclad Capital Markets LLC to Fund VI (the "Debt Commitment Letter"), pursuant to which such lenders have committed to provide debt financing to Fund VI (or one or more of its subsidiaries, including the surviving corporation following the Merger) in an aggregate principal amount of Four Billion Two Hundred Forty Million Dollars ($4,240,000,000), consisting of (i) a Term Loan B facility in an aggregate principal amount of Three Billion Seven Hundred Forty Million Dollars ($3,740,000,000) and (ii) a Revolving Credit Facility in an aggregate principal amount of Five Hundred Million Dollars ($500,000,000), in each case, on the terms and subject to the conditions set forth in the Debt Commitment Letter and the related fee letters;
(d) that certain Rollover Agreement, dated as of January 22, 2024, by and between Fund VI and Jonathan Hargrove, the Chief Executive Officer of Cloudium, pursuant to which Mr. Hargrove has agreed to contribute, or cause to be contributed, shares of Cloudium common stock with an aggregate implied value of approximately One Hundred Forty-Two Million Eight Hundred Fourteen Thousand Five Hundred Forty-Four Dollars ($142,814,544) in exchange for equity interests in Fund VI (or a holding company formed for such purpose) on the terms and subject to the conditions set forth therein;
(e) that certain Rollover Agreement, dated as of January 22, 2024, by and between Fund VI and Pinnacle Growth Ventures LLC, a Delaware limited liability company, pursuant to which Pinnacle Growth Ventures LLC has agreed to contribute, or cause to be contributed, shares of Cloudium common stock with an aggregate implied value of approximately Four Hundred Seventy-Three Million Two Hundred Forty-One Thousand Four Hundred Eight Dollars ($473,241,408) in exchange for equity interests in Fund VI (or a holding company formed for such purpose) on the terms and subject to the conditions set forth therein;
(f) those certain Voting and Support Agreements, each dated as of January 22, 2024, by and among Fund VI, the Company, and each of Jonathan Hargrove and Pinnacle Growth Ventures LLC, pursuant to which such stockholders have agreed, among other things, to vote all of their respective shares of Cloudium common stock in favor of the adoption of the Merger Agreement and against any competing proposal, in each case on the terms and subject to the conditions set forth therein;
(g) that certain Escrow Agreement, to be entered into at the closing of the Merger, among Fund VI, Cobalt Trust Company, a national banking association (as escrow agent), and the Stockholder Representative (as defined in the Merger Agreement), providing for the deposit of Five Hundred Forty-Four Million Dollars ($544,000,000) in cash into an indemnity escrow account to be held and distributed in accordance with Article IX of the Merger Agreement and the terms of the Escrow Agreement (the "Escrow Agreement"); and
(h) that certain Co-Investment Agreement, dated as of January 22, 2024, by and between Fund VI and Solara Digital Co-Invest VI-A LP, a Delaware limited partnership, pursuant to which Solara Digital Co-Invest VI-A LP has committed to co-invest alongside Fund VI in the transactions contemplated by the Merger Agreement in an aggregate amount of Four Hundred Twenty-Five Million Dollars ($425,000,000) on the terms and subject to the conditions set forth therein.
RESOLUTIONS
NOW, THEREFORE, BE IT RESOLVED, that the Sole Stockholder hereby irrevocably approves and adopts the Merger Agreement, substantially in the form presented to the Sole Stockholder (together with all schedules and exhibits thereto), including, without limitation, the Certificate of Merger attached as Exhibit A thereto, the Form of Surviving Corporation Certificate of Incorporation attached as Exhibit B thereto, and the Form of Surviving Corporation Bylaws attached as Exhibit C thereto, and the Sole Stockholder hereby consents to the execution, delivery, and performance by the Company of the Merger Agreement and each of the Related Transaction Documents to which the Company is or will be a party, in each case with such changes, amendments, supplements, or modifications as the officers of the Company executing the same may approve, the execution thereof by such officers to be conclusive evidence of such approval.
RESOLVED FURTHER, that the Sole Stockholder hereby approves the consummation of the Merger and all other transactions contemplated by the Merger Agreement, including, without limitation:
(a) the merger of the Company with and into Cloudium Technologies plc, with Cloudium surviving the Merger as a wholly owned subsidiary of Fund VI, upon the terms and subject to the conditions set forth in the Merger Agreement and in accordance with the applicable provisions of the DGCL and the laws of England and Wales;
(b) the payment of the Merger Consideration of Thirty-Six Dollars and Ninety-Two Cents ($36.92) per share in cash, without interest, to the holders of shares of Cloudium common stock (approximately 184,200,000 shares outstanding as of the date of execution of the Merger Agreement) entitled to receive such consideration, as contemplated by Section 2.1 of the Merger Agreement, and the funding of such Merger Consideration from the equity and debt financing sources contemplated by the Equity Commitment Letter, the Debt Commitment Letter, and the Co-Investment Agreement;
(c) the preparation, execution, and filing of the Certificate of Merger with the Secretary of State of the State of Delaware in accordance with Section 251 of the DGCL, and the taking of all other actions necessary or appropriate to cause the Merger to become effective at the effective time designated in or determined pursuant to the Certificate of Merger;
(d) in connection with the closing of the Merger, the repayment in full of Cloudium's existing indebtedness of approximately Eight Hundred Twenty Million Dollars ($820,000,000) outstanding under that certain Credit Agreement, dated as of March 15, 2021 (as amended, restated, supplemented, or otherwise modified from time to time), among Cloudium, the lenders party thereto, and Atlas Commercial Lending Corp., as administrative agent and collateral agent, and the termination of all commitments, the release of all liens, and the discharge of all obligations thereunder;
(e) the deposit of Five Hundred Forty-Four Million Dollars ($544,000,000) in cash into the indemnity escrow account maintained by Cobalt Trust Company pursuant to the Escrow Agreement, to serve as security for the indemnification obligations of the former stockholders of Cloudium as set forth in Article IX of the Merger Agreement;
(f) the execution and delivery by the Company of all ancillary agreements, certificates, instruments, and documents contemplated by or required in connection with the Merger Agreement and the consummation of the transactions contemplated thereby, including the Escrow Agreement, the officer's certificates, the secretary's certificates, and such other closing deliverables as may be required pursuant to Article VII of the Merger Agreement; and
(g) the payment of all transaction expenses, advisory fees, transfer taxes, and other costs and expenses incurred by or on behalf of the Company in connection with the negotiation, execution, and consummation of the Merger Agreement and the transactions contemplated thereby.
RESOLVED FURTHER, that each officer of the Company, and each person designated by any such officer as an authorized agent or representative of the Company, is hereby authorized, empowered, and directed, in the name of and on behalf of the Company, to execute and deliver the Merger Agreement, the Certificate of Merger, and all other agreements, certificates, instruments, documents, and writings required or contemplated by the Merger Agreement or any of the Related Transaction Documents, and to take all such further actions as such officer or designated person may deem necessary, advisable, or appropriate to carry out the intent and purposes of the foregoing resolutions, including, without limitation:
(a) the execution and delivery of the Merger Agreement, together with all schedules and exhibits thereto, on behalf of the Company, with such changes, amendments, supplements, or modifications thereto as the executing officer may approve, such officer's execution thereof to be conclusive evidence of such approval;
(b) the preparation, execution, and filing of the Certificate of Merger with the Secretary of State of the State of Delaware at the effective time, and the filing of any and all other certificates, documents, or instruments with the Secretary of State of the State of Delaware or any other governmental authority as may be required or desirable in connection with the Merger;
(c) the execution and delivery of the Escrow Agreement with Cobalt Trust Company, as escrow agent, and the Stockholder Representative, and the deposit of the requisite escrow funds in accordance with the terms thereof;
(d) the execution and delivery of officer's certificates, secretary's certificates, good standing certificates, incumbency certificates, and other closing deliverables required to be delivered by or on behalf of the Company at or prior to the closing of the Merger pursuant to Article VII of the Merger Agreement;
(e) the payment of all Merger Consideration, transaction expenses, and other amounts contemplated by the Merger Agreement and the funds flow memorandum to be prepared in connection with the closing of the Merger, and the authorization and direction of any bank, financial institution, paying agent, or escrow agent to make such payments on behalf of the Company;
(f) the making of any filings with or submissions to the United States Securities and Exchange Commission, The Nasdaq Stock Market LLC, the United Kingdom Financial Conduct Authority, or any other governmental authority, self-regulatory organization, or stock exchange as may be required in connection with the Merger Agreement or the consummation of the transactions contemplated thereby; and
(g) the taking of any and all other actions and the execution and delivery of any and all other agreements, certificates, instruments, documents, and writings as any such officer or designated person may deem necessary, advisable, or appropriate in connection with the foregoing resolutions and the transactions contemplated by the Merger Agreement, the execution and delivery of any such agreement, certificate, instrument, document, or writing or the taking of any such action to be conclusive evidence of such officer's or designated person's determination that the same is necessary, advisable, or appropriate.
RESOLVED FURTHER, that any and all actions heretofore taken by the officers, directors, or authorized agents of the Company in connection with the Merger Agreement and the transactions contemplated thereby and by the Related Transaction Documents, including, without limitation, the incorporation of the Company on January 8, 2024, the adoption of the Certificate of Incorporation and Bylaws of the Company, the issuance of the initial shares of capital stock of the Company to Fund VI, and any negotiations, discussions, or other actions undertaken in furtherance of the Merger Agreement and the related transactions, are hereby ratified, confirmed, and approved in all respects as the authorized acts and deeds of the Company.
RESOLVED FURTHER, that each officer of the Company is hereby authorized, empowered, and directed to execute and deliver such additional agreements, certificates, instruments, documents, and writings, to pay such fees and expenses, and to take such further actions, in each case in the name of and on behalf of the Company, as any such officer may deem necessary, advisable, or appropriate to effectuate and carry out the purposes and intent of the foregoing resolutions, the execution and delivery of any such agreement, certificate, instrument, document, or writing, the payment of any such fees or expenses, or the taking of any such action to be conclusive evidence of such officer's determination that the same is necessary, advisable, or appropriate.
EFFECTIVENESS AND MISCELLANEOUS
Effectiveness. This written consent shall be effective as of the date first written above, January 22, 2024. This written consent shall have the same force and effect as if the actions consented to herein had been approved and adopted at a duly called and held special meeting of the stockholders of the Company at which a quorum was present and acting throughout.
DGCL Compliance. This written consent is being executed by the holder of all of the issued and outstanding shares of capital stock of the Company entitled to vote on the matters described herein, in full satisfaction of the requirements of Section 228 of the DGCL, including, without limitation, the requirement that the written consent be signed by the holders of outstanding stock having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and voted. Because this written consent is executed by the Sole Stockholder holding one hundred percent (100%) of the outstanding capital stock of the Company, prompt notice of the taking of corporate action without a meeting by less than unanimous written consent, as would otherwise be required by Section 228(e) of the DGCL, is not required.
Counterparts. This written consent may be executed in one or more counterparts (including by facsimile or portable document format (.pdf) transmission), each of which shall be deemed an original and all of which, taken together, shall constitute one and the same instrument. Delivery of an executed counterpart of this written consent by facsimile or electronic transmission (including by .pdf) shall be effective as delivery of an original executed counterpart.
Governing Law. This written consent shall be governed by, and construed and interpreted in accordance with, the internal laws of the State of Delaware, without giving effect to any choice or conflict of law provision or rule (whether of the State of Delaware or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of Delaware.
[Signature Page Follows]
IN WITNESS WHEREOF, the undersigned has executed this Written Consent of the Sole Stockholder of Stratos Merger Sub Inc. as of the date first written above.
SOLARA DIGITAL INFRASTRUCTURE FUND VI LP
By: Solara Fund VI GP LLC, a Delaware limited liability company, its General Partner
By: ________
Name: Marcus Elliston
Title: Managing Partner
Date: January 22, 2024
Address for notices:
Solara Digital Infrastructure Fund VI LP c/o Solara Fund VI GP LLC 1200 Market Street, Suite 3400 Wilmington, Delaware 19801
[Signature Page to Written Consent of Sole Stockholder of Stratos Merger Sub Inc.]