CO-INVESTMENT AGREEMENT
EXECUTION VERSION
dated as of
January 22, 2024
among
SOLARA DIGITAL INFRASTRUCTURE FUND VI LP (as Lead Investor)
SOLARA DIGITAL CO-INVEST VI-A LP (as Co-Investor)
and
SOLARA FUND VI GP LLC (as General Partner)
TABLE OF CONTENTS
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CO-INVESTMENT AGREEMENT
This CO-INVESTMENT AGREEMENT (this "Agreement") is entered into as of January 22, 2024, by and among:
(1) Solara Digital Infrastructure Fund VI LP, a Delaware limited partnership ("Fund VI" or the "Lead Investor");
(2) Solara Digital Co-Invest VI-A LP, a Delaware limited partnership ("Co-Invest VI-A" or the "Co-Investor"); and
(3) Solara Fund VI GP LLC, a Delaware limited liability company, in its capacity as general partner of each of Fund VI and Co-Invest VI-A (the "General Partner" or "GP").
Each of Fund VI, Co-Invest VI-A, and the GP is sometimes referred to herein individually as a "Party" and collectively as the "Parties."
The General Partner of Fund VI is Solara Fund VI GP LLC. The General Partner of Co-Invest VI-A is also Solara Fund VI GP LLC. Each of Fund VI and Co-Invest VI-A is managed by the GP in accordance with its respective limited partnership agreement.
Reference is made to Solara Digital Infrastructure LP ("Solara" or "SDILP"), a Delaware limited partnership, the sponsor platform through which the GP and its affiliates conduct their investment management activities, with principal offices at 1200 Market Street, Suite 3400, Wilmington, Delaware 19801. The managing partners of Solara are Marcus Elliston (Founder & Managing Partner) and Priya Narasimhan (Co-Managing Partner & Chief Investment Officer).
RECITALS
WHEREAS, Fund VI has entered into that certain Agreement and Plan of Merger, dated as of January 22, 2024 (the "Merger Agreement"), among Cloudium Technologies plc, a public limited company incorporated under the laws of England and Wales (Company No. 09734521) ("Cloudium" or the "Target"), Stratos Merger Sub Inc., a Delaware corporation ("Merger Sub"), and Solara Digital Infrastructure Fund VI LP, pursuant to which Merger Sub will merge with and into Cloudium in a reverse triangular merger under the Delaware General Corporation Law, with Cloudium surviving as a wholly owned subsidiary of Fund VI (the "Transaction");
WHEREAS, the aggregate deal value of the Transaction is approximately $6,800,000,000, representing approximately $36.92 per share of Cloudium common stock (Nasdaq: CLDM), based upon 184,200,000 shares of Cloudium common stock issued and outstanding as of the date hereof;
WHEREAS, the total funding requirement for the Transaction is $7,188,944,048, comprising (i) cash merger consideration payable to non-rolling shareholders of Cloudium in the amount of $6,183,944,048, (ii) estimated transaction expenses in the aggregate amount of $185,000,000, and (iii) repayment of existing Cloudium indebtedness in the amount of $820,000,000 owed to Atlas Commercial Lending Corp. under that certain Credit Agreement dated March 15, 2021, among Cloudium, Atlas Commercial Lending Corp. as administrative agent, and the lenders party thereto;
WHEREAS, the sources of funds for the Transaction consist of (i) a $3,740,000,000 Term Loan B facility, (ii) a $500,000,000 revolving credit facility (capacity; $0 drawn at closing), (iii) an equity contribution from Fund VI (inclusive of the Co-Investment described herein) in the aggregate amount of $2,832,888,096, and (iv) rollover equity of $616,055,952 contributed by Jonathan Hargrove and Pinnacle Growth Ventures LLC pursuant to the applicable Rollover Agreements;
WHEREAS, Fund VI has delivered an Equity Commitment Letter dated January 22, 2024, to Merger Sub committing to fund $2,832,888,096 in aggregate equity to consummate the Transaction;
WHEREAS, certain limited partners of Fund VI have been offered co-investment rights pursuant to the Amended and Restated Agreement of Limited Partnership of Fund VI (the "Fund VI LPA") and the applicable side letter agreements entered into between the GP and such limited partners, and the GP has formed Co-Invest VI-A to serve as the dedicated co-investment vehicle for the Transaction;
WHEREAS, Co-Invest VI-A will co-invest $425,000,000 alongside Fund VI in the Transaction, which amount is a subset of and is included within the $2,832,888,096 aggregate equity commitment of Fund VI under the Equity Commitment Letter; and
WHEREAS, the Parties desire to set forth the terms and conditions upon which Co-Invest VI-A will participate in the equity investment in the Transaction alongside Fund VI.
NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:
ARTICLE I — DEFINITIONS
Section 1.1 — Defined Terms
As used in this Agreement, the following terms shall have the meanings set forth below:
"Acquisition" or "Transaction" means the reverse triangular merger of Merger Sub with and into Cloudium pursuant to the Merger Agreement, as a result of which Merger Sub shall cease to exist and Cloudium shall continue as the surviving corporation and a wholly owned subsidiary of Fund VI (or a holding entity designated by the GP).
"Affiliate" means, with respect to any Person, any other Person that directly or indirectly controls, is controlled by, or is under common control with, such Person. For purposes of this definition, "control" (including, with correlative meaning, the terms "controlled by" and "under common control with") means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities, by contract, or otherwise. For the avoidance of doubt, Fund VI, Co-Invest VI-A, and the GP shall each be deemed Affiliates of one another, and each shall be deemed an Affiliate of Solara Digital Infrastructure LP.
"Business Day" means any day that is not a Saturday, Sunday, or other day on which commercial banks in New York, New York or Wilmington, Delaware are authorized or required by law to remain closed.
"Capital Contribution" means the Co-Investor's $425,000,000 cash contribution to fund the Co-Investment as contemplated by this Agreement.
"Closing" means the closing of the Transaction under and in accordance with the Merger Agreement. The Closing occurred on July 9, 2024.
"Closing Date" means the date on which the Closing occurs, which was July 9, 2024.
"CMA" means the Competition and Markets Authority of the United Kingdom.
"Co-Investment" means the $425,000,000 equity investment by Co-Invest VI-A in the Transaction alongside Fund VI, on the terms and conditions set forth in this Agreement.
"Co-Investment Amount" means $425,000,000.
"Co-Investment Percentage" means Co-Invest VI-A's percentage interest in the aggregate equity invested in the Transaction by the Investor Group, equal to $425,000,000 divided by $2,832,888,096, which equals approximately 15.0%.
"Co-Invest VI-A" means Solara Digital Co-Invest VI-A LP, a Delaware limited partnership.
"Co-Invest VI-A LPA" means the Agreement of Limited Partnership of Co-Invest VI-A, as may be amended, restated, supplemented, or otherwise modified from time to time.
"Credit Agreement" means the Credit Agreement dated as of the Closing Date among Cloudium Technologies plc (as Borrower), Meridian Atlantic Bank, N.A. (as Administrative Agent), Ironclad Capital Markets LLC (as Co-Arranger), and the lenders party thereto, providing for (i) a $3,740,000,000 Term Loan B facility and (ii) a $500,000,000 revolving credit facility.
"Debt Commitment Letter" means the debt commitment letter dated January 22, 2024, from Meridian Atlantic Bank, N.A. and Ironclad Capital Markets LLC to Fund VI, pursuant to which such institutions committed to provide the debt financing for the Transaction on the terms and conditions set forth therein.
"Equity Commitment Letter" means the equity commitment letter dated January 22, 2024, from Fund VI to Merger Sub, pursuant to which Fund VI committed to contribute $2,832,888,096 in aggregate equity to Merger Sub (or its designee) to consummate the Transaction.
"Escrow Agreement" means the Escrow Agreement dated January 22, 2024 (effective at the Closing), among Fund VI, Douglas Pemberton (in his capacity as Stockholder Representative), and Cobalt Trust Company (as escrow agent), governing the deposit and release of the escrow funds deposited in connection with the Transaction.
"Fund VI" means Solara Digital Infrastructure Fund VI LP, a Delaware limited partnership, vintage 2022, with $12,400,000,000 in committed capital and employer identification number (EIN) 87-4523190.
"Fund VI LPA" means the Amended and Restated Agreement of Limited Partnership of Fund VI, as may be amended, restated, supplemented, or otherwise modified from time to time.
"General Partner" or "GP" means Solara Fund VI GP LLC, a Delaware limited liability company, in its capacity as general partner of each of Fund VI and Co-Invest VI-A.
"HSR Act" means the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and the rules and regulations promulgated thereunder.
"Investment" means the equity interests (whether direct or indirect) in the Surviving Entity (or any direct or indirect parent holding entity thereof) acquired by Co-Invest VI-A in connection with the Transaction.
"Investor Group" means, collectively, Fund VI and Co-Invest VI-A, in their capacities as investors in the equity of the Transaction, but excluding the Rollover Equity participants.
"Lead Investor" means Solara Digital Infrastructure Fund VI LP.
"Limited Guarantee" means the limited guarantee dated January 22, 2024, from Solara Fund VI GP LLC in favor of Cloudium Technologies plc, guaranteeing up to $246,000,000 (comprising $221,000,000 in respect of the reverse termination fee and $25,000,000 in respect of enforcement costs) in connection with certain obligations of Fund VI under the Merger Agreement.
"Merger Agreement" has the meaning set forth in the Recitals, being the Agreement and Plan of Merger dated as of January 22, 2024, among Cloudium Technologies plc, Stratos Merger Sub Inc., and Solara Digital Infrastructure Fund VI LP.
"Merger Sub" means Stratos Merger Sub Inc., a Delaware corporation (DE File No. 7923841), with its registered office at 1209 Orange Street, Wilmington, Delaware 19801, organized for the purpose of effecting the Transaction.
"Person" means any individual, corporation, partnership, limited liability company, joint venture, association, trust, unincorporated organization, governmental authority, or other entity.
"R&W Insurance Policy" means the buyer-side representation and warranty insurance policy issued by Northfield Assurance Ltd. (Policy No. NFA-TRI-2024-00487), providing a $680,000,000 aggregate policy limit (representing approximately 10% of the aggregate deal value), subject to a $544,000,000 retention (with a 50% retention drop-down to $272,000,000 after twelve (12) months from the Closing Date if no claims are pending), with a total premium of $13,600,000.
"Rollover Agreements" means, collectively, (i) the Rollover Agreement dated January 22, 2024, between Fund VI and Jonathan Hargrove, and (ii) the Rollover Agreement dated January 22, 2024, between Fund VI and Pinnacle Growth Ventures LLC, pursuant to which such Persons agreed to contribute rollover equity in the Transaction.
"Rollover Equity" means the $616,055,952 in aggregate rollover equity contributed by Jonathan Hargrove (approximately $142,814,544, representing 50% of his 7,736,400 shares of Cloudium common stock at $36.92 per share) and Pinnacle Growth Ventures LLC (approximately $473,241,408, representing 60% of its 21,367,200 shares of Cloudium common stock at $36.92 per share) pursuant to the Rollover Agreements.
"Securities Act" means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.
"Surviving Entity" means Cloudium Technologies plc, as the surviving corporation in the merger contemplated by the Merger Agreement.
"Target" means Cloudium Technologies plc, a public limited company incorporated under the laws of England and Wales (Company No. 09734521).
"Transaction Documents" means, collectively, the Merger Agreement, the Equity Commitment Letter, the Debt Commitment Letter, the Limited Guarantee, the Rollover Agreements, the Voting/Support Agreements entered into by certain stockholders of Cloudium, the Escrow Agreement, the Credit Agreement, the R&W Insurance Policy, and all exhibits, schedules, and ancillary documents executed in connection therewith or pursuant thereto.
"Transaction Expenses" means all fees, costs, and expenses incurred in connection with the Transaction, estimated at $185,000,000 in aggregate, including advisory fees, legal fees, accounting and tax advisory fees, financing fees, insurance premiums, regulatory filing fees, proxy solicitation fees, and other out-of-pocket costs.
Section 1.2 — Interpretive Provisions
(a) Unless the context otherwise requires, (i) all references to Sections, Articles, Schedules, or Exhibits are to Sections, Articles, Schedules, or Exhibits of or to this Agreement, (ii) each accounting term not otherwise defined in this Agreement has the meaning assigned to it in accordance with United States generally accepted accounting principles, (iii) words in the singular include the plural and vice versa, (iv) the terms "herein," "hereof," "hereunder," and words of similar import refer to this Agreement as a whole and not to any particular Section, Article, or provision hereof, and (v) the word "including" means "including, without limitation."
(b) Capitalized terms used but not otherwise defined in this Agreement and that are defined in the Merger Agreement shall have the meanings ascribed to such terms in the Merger Agreement.
(c) References to any agreement, instrument, or other document mean such agreement, instrument, or other document as amended, restated, supplemented, or otherwise modified from time to time to the extent permitted by the provisions thereof and by this Agreement.
(d) References to any statute or regulation mean such statute or regulation as amended, modified, supplemented, or replaced from time to time (and, in the case of any statute, include any rules and regulations promulgated under such statute), and references to any section of any statute or regulation include any successor to such section.
(e) All references to currency or "$" are references to the lawful currency of the United States of America.
ARTICLE II — CO-INVESTMENT COMMITMENT
Section 2.1 — Co-Investment Amount
Co-Invest VI-A hereby commits to invest Four Hundred Twenty-Five Million Dollars ($425,000,000) (the "Co-Investment Amount") in the Transaction on the terms and subject to the conditions set forth in this Agreement. The Co-Investment Amount constitutes a portion of the $2,832,888,096 aggregate equity commitment of Fund VI under the Equity Commitment Letter and shall be deployed as part of the Investor Group's equity contribution to consummate the Transaction. For the avoidance of doubt, the Co-Investment Amount is not in addition to, but is included within, the aggregate equity commitment set forth in the Equity Commitment Letter.
The Co-Investment Amount is sourced from certain limited partners of Fund VI that have elected to exercise co-investment rights afforded to them under (i) the Fund VI LPA and (ii) the applicable co-investment side letter agreements entered into between the GP and such limited partners. Such limited partners have committed to fund their respective portions of the Co-Investment Amount through capital contributions to Co-Invest VI-A in accordance with the Co-Invest VI-A LPA and the capital call mechanics set forth in Section 2.3 of this Agreement. The Co-Investment shall be funded entirely in cash at or prior to the Closing.
Section 2.2 — Co-Investment Percentage
Co-Invest VI-A's Co-Investment Percentage shall be $425,000,000 divided by $2,832,888,096, which equals approximately 15.0% of the aggregate equity invested by the Investor Group (i.e., Fund VI and Co-Invest VI-A, collectively) in the Transaction. Co-Invest VI-A's economic interest in the Investment shall be proportional to the Co-Investment Percentage, subject to adjustment as provided in this Agreement, including adjustments resulting from any follow-on investments made pursuant to Section 5.4, any additional capital contributions, or any disproportionate distributions or allocations agreed upon by the Parties.
For the avoidance of doubt, the Rollover Equity contributed by Jonathan Hargrove and Pinnacle Growth Ventures LLC (aggregating $616,055,952) is not included in the denominator for purposes of calculating the Co-Investment Percentage, as such Rollover Equity participants hold separate equity interests in the Surviving Entity and are not members of the Investor Group for purposes of this Agreement. The calculation of the Co-Investment Percentage is set forth in further detail in Schedule B attached hereto.
Section 2.3 — Funding Mechanics
(a) Co-Invest VI-A shall fund the Co-Investment Amount by wire transfer of immediately available funds to the bank account designated by the GP (or its designee) no later than one (1) Business Day prior to the anticipated Closing Date, as communicated by the GP in the capital call notice described in clause (b) below.
(b) The GP shall deliver a capital call notice (substantially in the form attached hereto as Exhibit A) to the limited partners of Co-Invest VI-A specifying (i) the aggregate Co-Investment Amount to be funded, (ii) each limited partner's proportionate share thereof, (iii) wire transfer instructions for the designated funding account, and (iv) the funding deadline. The GP shall use commercially reasonable efforts to deliver such capital call notice at least ten (10) Business Days prior to the anticipated Closing Date.
(c) All funds received by the GP (or its designee) pursuant to this Section 2.3 shall be held in a segregated account maintained by the GP (or its designee) at Meridian Atlantic Bank, N.A. (or such other nationally recognized financial institution as the GP may select) pending the Closing. Such funds shall not be commingled with the assets of Fund VI, the GP, or any other entity, and shall be held for the sole benefit of Co-Invest VI-A and its limited partners until applied to fund the Co-Investment at the Closing.
(d) In the event the Closing does not occur for any reason (including termination of the Merger Agreement in accordance with its terms), all funded amounts shall be returned to the limited partners of Co-Invest VI-A within five (5) Business Days following the date on which it becomes reasonably clear that the Closing will not occur, without interest (except to the extent interest is actually earned on the segregated account during the period such funds are held therein, which interest shall be distributed to the limited partners pro rata). Such return of funds shall be made by wire transfer to the accounts from which the relevant contributions were originally received, unless a limited partner provides alternative wire instructions in writing to the GP.
Section 2.4 — Equity Commitment Letter Coordination
The Parties acknowledge and agree that the Co-Investment Amount is included within, and is not in addition to, the $2,832,888,096 aggregate equity commitment of Fund VI under the Equity Commitment Letter. Fund VI's obligation under the Equity Commitment Letter shall be reduced on a dollar-for-dollar basis by the amount actually funded by Co-Invest VI-A at the Closing. Accordingly, at the Closing, (i) Fund VI shall contribute $2,832,888,096 minus $425,000,000, which equals $2,407,888,096, from its own committed capital, and (ii) Co-Invest VI-A shall contribute $425,000,000 from the capital contributions of its limited partners. The aggregate equity contribution funded by the Investor Group at the Closing shall equal $2,832,888,096, which is the full amount required under the Equity Commitment Letter.
The GP shall coordinate the funding of the aggregate equity contribution to ensure that the combined contributions of Fund VI and Co-Invest VI-A are remitted to Merger Sub (or its designee) in a timely manner and in compliance with the requirements of the Merger Agreement and the Equity Commitment Letter. In the event Co-Invest VI-A fails to fund all or any portion of the Co-Investment Amount by the applicable funding deadline, Fund VI shall fund such shortfall from its own committed capital, and Fund VI shall have all rights and remedies available to it under this Agreement and the Co-Invest VI-A LPA against the defaulting limited partner(s) of Co-Invest VI-A.
Section 2.5 — No Obligation of Target or Merger Sub
Neither Cloudium Technologies plc nor Stratos Merger Sub Inc. is a party to, or third-party beneficiary of, this Agreement. This Agreement does not create any rights, obligations, or claims in favor of the Target, any stockholder of the Target, Merger Sub, or any other third party (other than as expressly set forth in Section 11.9), and neither the Target nor any other Person (other than the Parties hereto) shall have any right to enforce any provision of this Agreement. Nothing in this Agreement shall modify, amend, or supplement the Merger Agreement, the Equity Commitment Letter, or the Limited Guarantee, or expand or limit any Party's obligations thereunder.
ARTICLE III — TERMS OF THE INVESTMENT
Section 3.1 — Form of Investment
The Co-Investment shall be made in the form of a capital contribution to Fund VI (or to a holding entity designated by the GP that directly or indirectly holds equity interests in the Surviving Entity) in exchange for a direct or indirect equity interest in the Surviving Entity. The GP shall have the discretion, exercisable in its reasonable business judgment, to structure the Co-Investment through one or more intermediate holding entities, blocker corporations (including blocker entities formed for the benefit of tax-exempt and non-U.S. limited partners), or alternative investment vehicles, provided that in each case the economic terms applicable to Co-Invest VI-A (including its proportionate share of returns, distributions, and allocations) are not materially adversely affected by such structuring without the prior written consent of Co-Invest VI-A (acting through the GP on behalf of a majority in interest of the limited partners of Co-Invest VI-A). The GP shall bear all costs of structuring the Investment, except to the extent otherwise provided in Section 8.2.
Section 3.2 — Proportionate Interest
Co-Invest VI-A shall hold a Co-Investment Percentage interest (approximately 15.0%) in the Investment. All returns, gains, losses, distributions, and allocations with respect to the Investment shall be shared between Fund VI and Co-Invest VI-A on a pro rata basis in proportion to their respective capital contributions (i.e., $2,407,888,096 for Fund VI and $425,000,000 for Co-Invest VI-A), subject to the provisions of Section 3.3 (relating to carried interest and management fees) and any other adjustments expressly provided for in this Agreement.
For the avoidance of doubt, the Rollover Equity participants (Jonathan Hargrove and Pinnacle Growth Ventures LLC) hold separate and distinct equity interests in the Surviving Entity pursuant to the Rollover Agreements and are not part of the Investor Group for purposes of this Agreement. The rights and obligations of the Rollover Equity participants with respect to their equity interests in the Surviving Entity are governed exclusively by the Rollover Agreements and the organizational documents of the Surviving Entity (or its parent holding entity), and nothing in this Agreement shall be construed to confer any rights upon, or impose any obligations on, the Rollover Equity participants.
Section 3.3 — No Carried Interest or Management Fee on Co-Investment
(a) Management Fee. The GP shall not charge any management fee on the Co-Investment Amount or on any amount contributed to or held by Co-Invest VI-A in respect of the Investment. This provision reflects the customary practice for co-investment vehicles associated with Fund VI and is consistent with the terms offered to co-investing limited partners under the applicable co-investment side letter agreements.
(b) Carried Interest. The GP shall not charge any carried interest, performance allocation, incentive allocation, or similar performance-based compensation on returns attributable to the Co-Investment, except as may otherwise be agreed in writing in the applicable co-investment side letter agreements between the GP and the individual participating limited partners of Co-Invest VI-A. To the extent any such co-investment side letter agreement provides for a carried interest or performance allocation with respect to a particular limited partner's co-investment, such arrangement shall be solely between the GP and such limited partner and shall not affect the rights or obligations of any other limited partner of Co-Invest VI-A or of Fund VI.
(c) Expenses. Notwithstanding the foregoing provisions of this Section 3.3, Co-Invest VI-A shall bear its pro rata share (based on the Co-Investment Percentage, approximately 15.0%) of all Transaction Expenses incurred in connection with the Transaction (estimated at $185,000,000 in aggregate, resulting in an estimated pro rata share of approximately $27,750,000 for Co-Invest VI-A), all organizational expenses of Co-Invest VI-A (as set forth in Section 8.2), and all ongoing out-of-pocket costs directly attributable to the administration and maintenance of the Investment (including audit, tax preparation, legal, and regulatory compliance costs).
Section 3.4 — Escrow and Indemnification Participation
(a) Escrow. Co-Invest VI-A acknowledges that, in connection with the Transaction, an amount equal to $544,000,000 (representing approximately 8% of the aggregate deal value) has been deposited in escrow with Cobalt Trust Company, located at 100 Wall Street, New York, New York 10005 (Laura Ng, Vice President, Escrow Services), pursuant to the Escrow Agreement dated January 22, 2024 (effective at the Closing), with Douglas Pemberton serving as the Stockholder Representative. The escrow fund serves as the primary source of recovery for indemnification claims by the Investor Group against the former stockholders of Cloudium under the Merger Agreement.
(b) Indemnification Claims. Co-Invest VI-A's pro rata share of any indemnification recovery from the escrow fund or from direct indemnification claims asserted under the Merger Agreement shall be allocated proportionally based on the Co-Investment Percentage. The indemnification obligations of the former stockholders of Cloudium under the Merger Agreement are subject to the following limitations: (i) an aggregate indemnification cap of 15% of the aggregate deal value, equal to $1,020,000,000; (ii) a tipping basket of 0.75% of the aggregate deal value, equal to $51,000,000 (meaning that no indemnification shall be payable unless and until aggregate losses exceed $51,000,000, at which point the former stockholders shall be liable for all losses from the first dollar); and (iii) a de minimis threshold of $500,000 per individual claim (meaning that no individual claim for losses of less than $500,000 shall be included in calculating whether the tipping basket has been exceeded).
(c) Survival and Escrow Release Schedule. The representations and warranties of the former stockholders of Cloudium under the Merger Agreement survive for a period of eighteen (18) months following the Closing Date, expiring on January 9, 2026. The first escrow release, consisting of 50% of the escrow fund ($272,000,000), is scheduled for July 9, 2025 (subject to any pending or unresolved indemnification claims). The second escrow release, consisting of the remaining balance of the escrow fund, is scheduled for January 9, 2026 (subject to any pending or unresolved indemnification claims). Co-Invest VI-A shall receive its Co-Investment Percentage share of each escrow release.
(d) R&W Insurance. Co-Invest VI-A's share of any recovery under the R&W Insurance Policy issued by Northfield Assurance Ltd. (Policy No. NFA-TRI-2024-00487) shall also be allocated proportionally based on the Co-Investment Percentage. The R&W Insurance Policy has a $680,000,000 aggregate policy limit. The retention under the R&W Insurance Policy is $544,000,000, with a 50% retention drop-down to $272,000,000 after twelve (12) months from the Closing Date if no claims are pending under the policy at such time.
(e) R&W Insurance Costs. Co-Invest VI-A shall bear its pro rata share (based on the Co-Investment Percentage) of the R&W Insurance Policy premium of $13,600,000 and the broker fee of $680,000 payable to Peregrine Advisory Group LLC (Timothy Gallagher, Managing Director) in connection with the placement of the R&W Insurance Policy.
Section 3.5 — Reverse Termination Fee and Limited Guarantee Exposure
(a) Reverse Termination Fee and Limited Guarantee. In the event the Transaction is terminated and Solara Fund VI GP LLC is required to pay the reverse termination fee of $374,000,000 (representing 5.5% of the aggregate deal value) under the Merger Agreement, or any amount under the Limited Guarantee (which is capped at $246,000,000, comprising $221,000,000 in respect of the reverse termination fee and $25,000,000 in respect of enforcement costs), Co-Invest VI-A shall bear its Co-Investment Percentage share of such payments. For the avoidance of doubt, Co-Invest VI-A's share of the reverse termination fee obligation shall be calculated as 15.0% multiplied by the amount of the reverse termination fee actually payable.
(b) Cap on Exposure. Co-Invest VI-A's maximum aggregate exposure under this Section 3.5 shall not exceed the Co-Investment Amount (i.e., $425,000,000), and in no event shall Co-Invest VI-A be required to fund any amount in excess of its Co-Investment Amount for any purpose under this Agreement.
(c) Target Termination Fee. In the event the Merger Agreement is terminated by Cloudium in circumstances in which a termination fee is payable by Cloudium to Fund VI in the amount of $221,000,000 (representing 3.25% of the aggregate deal value), such termination fee, if received, shall be shared on a pro rata basis between Fund VI and Co-Invest VI-A based on the Co-Investment Percentage. Co-Invest VI-A's share of any such termination fee shall be distributed to the limited partners of Co-Invest VI-A in accordance with the Co-Invest VI-A LPA.
ARTICLE IV — GOVERNANCE AND MANAGEMENT
Section 4.1 — Management Authority
The GP shall have sole and exclusive authority and responsibility for managing the Investment on behalf of the Investor Group, including all decisions relating to the Transaction, the Surviving Entity, and the post-closing operation of Cloudium's business and that of its subsidiaries. Without limiting the generality of the foregoing, the GP shall have the authority to (i) exercise all voting, consent, and other governance rights with respect to the equity interests in the Surviving Entity held by or on behalf of the Investor Group, (ii) approve or reject any material business decisions of the Surviving Entity, including annual budgets, business plans, capital expenditure programs, financings, and strategic initiatives, (iii) appoint and remove directors, officers, and key employees of the Surviving Entity and its subsidiaries, and (iv) make all decisions regarding the timing, terms, and structure of any disposition of the Investment.
For informational purposes, Cloudium Technologies plc is a provider of cloud-native enterprise resource planning (ERP), customer relationship management (CRM), and business-intelligence software-as-a-service (SaaS) solutions serving mid-market and enterprise customers across a range of industry verticals. As of December 31, 2023, Cloudium's last twelve months ("LTM") revenue was approximately $1,620,000,000, LTM EBITDA was approximately $405,000,000, and annual recurring revenue ("ARR") was approximately $1,740,000,000. Cloudium employs approximately 6,800 people globally, with principal operations in the United States, the United Kingdom, India, and Germany.
The GP shall exercise the same standard of care in managing the Co-Investment as it exercises in managing the investments of Fund VI generally, and shall at all times act in good faith and in a manner consistent with its fiduciary obligations under the Co-Invest VI-A LPA and applicable law.
Section 4.2 — No Participation in Management by Co-Investor
Co-Invest VI-A and its limited partners shall have no right to participate in the management, operation, or control of the Investment, the Surviving Entity, or any of the Surviving Entity's subsidiaries, including Cloudium Technologies UK Ltd. (incorporated in England and Wales), Cloudium Technologies India Pvt. Ltd. (incorporated in India), and Cloudium Solutions GmbH (incorporated in Germany). Neither Co-Invest VI-A nor any limited partner of Co-Invest VI-A shall have any right to designate, nominate, or appoint any director, officer, manager, or observer to the board of directors (or equivalent governing body) of the Surviving Entity or any of its subsidiaries. Co-Invest VI-A shall have no voting rights with respect to actions taken by Fund VI in its capacity as the direct or indirect stockholder of the Surviving Entity, and the GP shall have no obligation to consult with or obtain the approval of Co-Invest VI-A or its limited partners with respect to any such actions, except as expressly provided in Section 4.4.
Section 4.3 — Information Rights
(a) The GP shall provide Co-Invest VI-A (or cause to be provided to Co-Invest VI-A) the same periodic reporting regarding the Investment as is provided to the limited partners of Fund VI generally, including (i) unaudited quarterly financial statements of the Surviving Entity within sixty (60) days following the end of each fiscal quarter, (ii) audited annual financial statements of the Surviving Entity within one hundred twenty (120) days following the end of each fiscal year, and (iii) Schedule K-1 (IRS Form 1065) tax information relating to Co-Invest VI-A within ninety (90) days following the end of each taxable year (or such later date as may be reasonably required to complete such tax information).
(b) The GP shall promptly notify Co-Invest VI-A of any material development with respect to the Investment, including but not limited to: (i) any indemnification claim asserted under the Merger Agreement or the Escrow Agreement, (ii) any escrow release event, (iii) any material litigation or governmental investigation involving the Surviving Entity or any of its subsidiaries, (iv) any proposed disposition of all or any material portion of the Investment, (v) any material default or event of default under the Credit Agreement, and (vi) any proposed material amendment to the Merger Agreement or any Transaction Document that could reasonably be expected to affect the Co-Investment.
(c) All information provided to Co-Invest VI-A or its limited partners pursuant to this Section 4.3 shall be subject to the confidentiality obligations set forth in Article X.
Section 4.4 — Consent Rights
Notwithstanding the authority of the GP set forth in Section 4.1, the GP shall not, without the prior written consent of limited partners holding a majority of the committed capital of Co-Invest VI-A (determined in accordance with the Co-Invest VI-A LPA):
(a) amend, modify, or supplement the terms of the Investment (including the economic terms, governance rights, or structural features thereof) in a manner that would be materially adverse to Co-Invest VI-A relative to Fund VI;
(b) enter into any transaction, agreement, or arrangement between the Investment (or the Surviving Entity or any of its subsidiaries) and the GP or any Affiliate of the GP (other than Fund VI) on terms that are not on an arm's-length basis or that would not be obtained from an unaffiliated third party in a comparable transaction; or
(c) require Co-Invest VI-A or its limited partners to make any additional capital contribution to the Investment in excess of the Co-Investment Amount, other than contributions expressly contemplated by this Agreement or reasonably required to preserve the value of the Investment (such as tax distributions, working capital calls, or follow-on investments offered on the terms set forth in Section 5.4).
The GP shall provide Co-Invest VI-A with at least fifteen (15) Business Days' prior written notice of any action requiring the consent of Co-Invest VI-A's limited partners under this Section 4.4, together with such information as is reasonably necessary for such limited partners to evaluate the proposed action. If the requisite consent is not obtained within such fifteen (15) Business Day period (or such longer period as the GP may specify in its notice), the GP shall not proceed with the proposed action.
ARTICLE V — DISPOSITIONS AND FOLLOW-ON INVESTMENTS
Section 5.1 — Tag-Along Rights
(a) If Fund VI proposes to sell, transfer, or otherwise dispose of all or any portion of its interest in the Investment to a third party that is not an Affiliate of Fund VI (a "Proposed Sale"), the GP shall, no later than ten (10) Business Days prior to the anticipated consummation of such Proposed Sale, deliver written notice to Co-Invest VI-A (a "Tag-Along Notice") setting forth (i) the identity of the proposed transferee, (ii) the number or amount of interests proposed to be sold, (iii) the proposed purchase price per unit of interest (and the form of consideration), (iv) the material terms and conditions of the Proposed Sale, and (v) the anticipated closing date of the Proposed Sale.
(b) Co-Invest VI-A shall have the right (a "Tag-Along Right"), exercisable by delivery of written notice to the GP within ten (10) Business Days following receipt of the Tag-Along Notice, to participate in the Proposed Sale on a pro rata basis (based on the Co-Investment Percentage) and on the same terms and conditions (including price per unit, form of consideration, representations, warranties, indemnification obligations, and escrow or holdback arrangements) as Fund VI.
(c) If Co-Invest VI-A elects to exercise its Tag-Along Right, Fund VI shall reduce the number of interests it proposes to sell in the Proposed Sale by the number of interests to be sold by Co-Invest VI-A (or, if the proposed transferee is willing to acquire all interests offered by both Fund VI and Co-Invest VI-A, Fund VI shall use commercially reasonable efforts to cause the proposed transferee to acquire Co-Invest VI-A's interests in addition to Fund VI's interests). If Co-Invest VI-A does not timely exercise its Tag-Along Right, Fund VI shall be free to consummate the Proposed Sale on terms no more favorable to Fund VI than those set forth in the Tag-Along Notice.
(d) The Tag-Along Right set forth in this Section 5.1 shall not apply to (i) any transfer by Fund VI to an Affiliate of Fund VI, (ii) any pledge or encumbrance of Fund VI's interest in connection with a bona fide financing transaction, or (iii) any transfer in connection with the dissolution or winding up of Fund VI in accordance with the Fund VI LPA.
Section 5.2 — Drag-Along Rights
(a) If Fund VI proposes to sell, transfer, or otherwise dispose of all of its interest in the Investment, and the proposed transaction would result in a change of control of the Surviving Entity (a "Drag-Along Sale"), Fund VI shall have the right (a "Drag-Along Right") to require Co-Invest VI-A to sell, transfer, or otherwise dispose of its entire pro rata interest in the Investment on the same terms and conditions (including price per unit, form of consideration, representations, warranties, and indemnification obligations) as Fund VI.
(b) Fund VI shall deliver written notice to Co-Invest VI-A of the Drag-Along Sale (a "Drag-Along Notice") no later than fifteen (15) Business Days prior to the anticipated consummation of the Drag-Along Sale, setting forth the material terms and conditions thereof. Co-Invest VI-A shall be obligated to cooperate with Fund VI in consummating the Drag-Along Sale and to execute and deliver such transfer documents, purchase agreements, and other instruments as may be reasonably requested by Fund VI or the proposed transferee.
(c) In connection with any Drag-Along Sale, Co-Invest VI-A shall not be required to (i) make any representations or warranties other than as to its own authority, title to its interests, and absence of encumbrances, or (ii) bear indemnification obligations in excess of its pro rata share (based on the Co-Investment Percentage) of the aggregate indemnification obligations of the Investor Group in such transaction, and in no event in excess of the net proceeds actually received by Co-Invest VI-A from such transaction.
Section 5.3 — Transfer Restrictions
(a) Co-Invest VI-A shall not directly or indirectly sell, transfer, assign, pledge, hypothecate, encumber, or otherwise dispose of all or any portion of its interest in the Investment without the prior written consent of the GP, which consent may be withheld in the GP's sole and absolute discretion.
(b) Notwithstanding the foregoing, Co-Invest VI-A may transfer its interest in the Investment (or its limited partners may transfer their limited partnership interests in Co-Invest VI-A) to Affiliates of Co-Invest VI-A's limited partners without the GP's consent, provided that (i) such transfer complies with all applicable federal and state securities laws, (ii) the transferee delivers to the GP customary transfer documents (including an opinion of counsel, if reasonably requested, that such transfer is exempt from registration under the Securities Act), and (iii) the transferee agrees in writing to be bound by the terms and conditions of this Agreement and the Co-Invest VI-A LPA.
(c) Any purported transfer in violation of this Section 5.3 shall be null and void and of no force or effect.
Section 5.4 — Follow-On Investments
(a) If the GP determines, in its reasonable business judgment, that additional equity capital is required to be invested in the Surviving Entity or any of its subsidiaries (including for add-on acquisitions, working capital needs, debt repayment, or capital expenditures), the GP shall provide written notice to Co-Invest VI-A of such proposed follow-on investment (a "Follow-On Notice") at least fifteen (15) Business Days prior to the date on which such additional capital is required.
(b) The Follow-On Notice shall set forth (i) the aggregate amount of additional equity capital required, (ii) the purpose for which such capital will be deployed, (iii) the terms and conditions of the follow-on investment (including any new equity instruments to be issued), and (iv) Co-Invest VI-A's pro rata share (at the Co-Investment Percentage) of the proposed follow-on investment.
(c) Co-Invest VI-A shall have the right, but not the obligation, to participate in such follow-on investment on a pro rata basis at the Co-Investment Percentage and on the same terms and conditions as Fund VI. If Co-Invest VI-A elects to participate, it shall deliver written notice of such election to the GP within ten (10) Business Days following receipt of the Follow-On Notice and shall fund its share of the follow-on investment within the time period specified in the Follow-On Notice.
(d) If Co-Invest VI-A elects not to participate in a follow-on investment, or participates in an amount less than its pro rata share, Co-Invest VI-A's Co-Investment Percentage shall be proportionately adjusted to reflect the dilutive effect of such non-participation. The GP shall provide Co-Invest VI-A with a revised calculation of the Co-Investment Percentage promptly following the consummation of each follow-on investment.
ARTICLE VI — DISTRIBUTIONS
Section 6.1 — Distribution Waterfall
(a) All distributions from the Investment (including distributions of proceeds from any disposition of the Investment or any portion thereof, dividends, distributions of operating cash flow, and escrow releases) shall be made to Fund VI and Co-Invest VI-A on a pro rata basis in proportion to the Co-Investment Percentage.
(b) Distributions shall be made in cash. No in-kind distribution of securities, property, or other non-cash assets shall be made to Co-Invest VI-A without the prior written consent of the GP.
(c) Subject to the terms of the Co-Invest VI-A LPA, distributions to Co-Invest VI-A shall be applied in the following order of priority:
First, to the return of the aggregate Capital Contributions made by Co-Invest VI-A (and its limited partners) to the Investment, until such Capital Contributions have been returned in full;
Second, to the payment of any preferred return, if and to the extent provided in the Co-Invest VI-A LPA, on the unreturned Capital Contributions of Co-Invest VI-A's limited partners, calculated at the rate and in the manner specified therein;
Third, all remaining amounts shall be distributed to the limited partners of Co-Invest VI-A on a pro rata basis in proportion to their respective capital contributions.
(d) The GP shall determine the timing and amount of distributions in its reasonable discretion, taking into account the liquidity needs of the Investment, the terms of the Credit Agreement (including any limitations on distributions imposed by the covenants contained therein), working capital requirements, reserves reasonably established by the GP, and applicable tax considerations.
Section 6.2 — Tax Distributions
The GP shall cause the Investment vehicle (or the applicable holding entity) to make tax distributions in amounts sufficient to cover the estimated income tax liabilities of the partners of Co-Invest VI-A arising from allocations of taxable income from the Investment, calculated at assumed combined federal, state, and local income tax rates as determined by the GP in good faith (the "Assumed Tax Rate"). Tax distributions shall be made on a quarterly basis (or at such other intervals as the GP determines appropriate) and shall reduce subsequent distributions under Section 6.1 on a dollar-for-dollar basis. In no event shall the GP be required to make tax distributions if (i) the Investment vehicle has insufficient cash available for distribution, (ii) making such distributions would cause the Investment vehicle to violate any covenant or agreement under the Credit Agreement or any other applicable financing arrangement, or (iii) making such distributions would be prohibited by applicable law.
Section 6.3 — Withholding
The GP shall be entitled to withhold and deduct from any distribution to Co-Invest VI-A (or to any limited partner of Co-Invest VI-A) any amounts required to be withheld or deducted under applicable federal, state, local, or foreign tax law, including, without limitation, amounts required to be withheld under Sections 1441, 1442, 1445, 1446, or 1471-1474 of the Internal Revenue Code of 1986, as amended. Any amounts so withheld or deducted shall be treated as having been distributed to Co-Invest VI-A (or such limited partner) for all purposes of this Agreement. The GP shall use commercially reasonable efforts to provide Co-Invest VI-A with advance notice of any anticipated withholding to the extent practicable. Each limited partner of Co-Invest VI-A shall deliver to the GP a properly completed and executed IRS Form W-9 or IRS Form W-8BEN-E, as applicable, promptly upon request and upon any change in circumstances that would affect the information provided therein.
ARTICLE VII — REPRESENTATIONS AND WARRANTIES
Section 7.1 — Representations of the GP
The GP hereby represents and warrants to each of Fund VI and Co-Invest VI-A as follows:
(a) Organization and Standing. The GP is a limited liability company duly organized, validly existing, and in good standing under the laws of the State of Delaware. The GP has all requisite limited liability company power and authority to own and operate its assets and to carry on its business as presently conducted.
(b) Authority. The GP has full power and authority to execute and deliver this Agreement and to perform its obligations hereunder, including the authority to cause each of Fund VI and Co-Invest VI-A to perform their respective obligations under this Agreement. The execution, delivery, and performance of this Agreement by the GP have been duly authorized by all necessary limited liability company action on the part of the GP. This Agreement has been duly executed and delivered by the GP and constitutes the legal, valid, and binding obligation of the GP, enforceable against the GP in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium, and similar laws affecting creditors' rights generally and to general principles of equity.
(c) No Conflicts. The execution, delivery, and performance of this Agreement by the GP does not and will not (i) violate, conflict with, or result in a breach of any provision of the GP's limited liability company agreement or certificate of formation, (ii) violate any applicable law, rule, regulation, order, judgment, or decree applicable to the GP, or (iii) result in a breach of, constitute a default under, or give rise to any right of termination, cancellation, or acceleration under, any material agreement, contract, or instrument to which the GP is a party or by which it is bound.
(d) No Litigation. There is no action, suit, proceeding, investigation, or claim pending or, to the knowledge of the GP, threatened against the GP that would, individually or in the aggregate, reasonably be expected to impair the GP's ability to perform its obligations under this Agreement.
Section 7.2 — Representations of Co-Invest VI-A
Co-Invest VI-A hereby represents and warrants to the GP and Fund VI as follows:
(a) Organization and Standing. Co-Invest VI-A is a limited partnership duly organized, validly existing, and in good standing under the laws of the State of Delaware. Co-Invest VI-A has all requisite limited partnership power and authority to own and operate its assets and to carry on its business as presently conducted.
(b) Authority. Co-Invest VI-A has full power and authority to execute and deliver this Agreement and to perform its obligations hereunder. The execution, delivery, and performance of this Agreement by Co-Invest VI-A (acting through the GP as its general partner) have been duly authorized by all necessary partnership action on the part of Co-Invest VI-A. This Agreement has been duly executed and delivered by Co-Invest VI-A and constitutes the legal, valid, and binding obligation of Co-Invest VI-A, enforceable against Co-Invest VI-A in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium, and similar laws affecting creditors' rights generally and to general principles of equity.
(c) Accredited Investor Status. Each limited partner of Co-Invest VI-A is an "accredited investor" within the meaning of Rule 501(a) of Regulation D under the Securities Act of 1933, as amended. Co-Invest VI-A has taken reasonable steps to verify the accredited investor status of each of its limited partners and has obtained customary investor representations from each such limited partner.
(d) Investment Intent. Each limited partner of Co-Invest VI-A is acquiring its interest in Co-Invest VI-A (and, indirectly, in the Investment) for its own account for investment purposes only and not with a view to or for sale in connection with any distribution thereof within the meaning of the Securities Act. Each limited partner of Co-Invest VI-A acknowledges that the interests in Co-Invest VI-A and the Investment have not been registered under the Securities Act or the securities laws of any state or other jurisdiction and may not be sold, transferred, or disposed of except in compliance with the registration requirements of the Securities Act and applicable state securities laws or pursuant to an applicable exemption therefrom.
(e) No Conflicts. The execution, delivery, and performance of this Agreement by Co-Invest VI-A does not and will not (i) violate, conflict with, or result in a breach of any provision of the Co-Invest VI-A LPA or the certificate of limited partnership of Co-Invest VI-A, or (ii) violate any applicable law, rule, regulation, order, judgment, or decree applicable to Co-Invest VI-A.
Section 7.3 — Representations of Fund VI
Fund VI hereby represents and warrants to Co-Invest VI-A and the GP as follows:
(a) Organization and Standing. Fund VI is a limited partnership duly organized, validly existing, and in good standing under the laws of the State of Delaware, with employer identification number (EIN) 87-4523190.
(b) Authority. Fund VI has full power and authority to execute and deliver this Agreement and to perform its obligations hereunder. The execution, delivery, and performance of this Agreement by Fund VI (acting through the GP as its general partner) have been duly authorized by all necessary partnership action on the part of Fund VI. This Agreement has been duly executed and delivered by Fund VI and constitutes the legal, valid, and binding obligation of Fund VI, enforceable against Fund VI in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium, and similar laws affecting creditors' rights generally and to general principles of equity.
(c) Equity Commitment Letter. The Equity Commitment Letter dated January 22, 2024, from Fund VI to Merger Sub, committing $2,832,888,096 in aggregate equity to consummate the Transaction, is in full force and effect and has not been amended, modified, or terminated. Fund VI has sufficient committed capital (net of the Co-Investment Amount) to fund its portion of the equity contribution at the Closing, being $2,407,888,096.
(d) Transaction Documents. The Merger Agreement, the Debt Commitment Letter, the Limited Guarantee, the Rollover Agreements, the Voting/Support Agreements, and the other Transaction Documents have been duly executed and delivered by the parties thereto and are in full force and effect as of the date hereof. True, correct, and complete copies of each Transaction Document have been made available to Co-Invest VI-A.
ARTICLE VIII — EXPENSES AND INDEMNIFICATION
Section 8.1 — Transaction Expenses
(a) Co-Invest VI-A shall bear its Co-Investment Percentage share (approximately 15.0%) of all Transaction Expenses incurred in connection with the Transaction. The aggregate Transaction Expenses are estimated at $185,000,000, resulting in an estimated allocation to Co-Invest VI-A of approximately $27,750,000.
(b) Transaction Expenses include, without limitation, the following fees, costs, and expenses:
(i) Legal fees and expenses of Calderwood & Harkness LLP, buyer's principal legal counsel (Matter No. 1041-00003; Harrison Wexford, Responsible Partner), for services rendered in connection with the negotiation, documentation, and consummation of the Transaction, including advice on corporate, securities, tax, ERISA, intellectual property, environmental, antitrust, and financing matters;
(ii) Legal fees and expenses of Albright & Kerr LLP, buyer's UK regulatory counsel (Fiona McAllister, Lead Partner), for services rendered in connection with UK regulatory filings and approvals, including the CMA merger control process;
(iii) Advisory fees and expenses of Osprey Bancroft & Co., buyer's financial advisor (Damien Harlow, Managing Director), for financial advisory services rendered in connection with the Transaction, including fairness opinion and valuation analysis;
(iv) Accounting and tax advisory fees and expenses of Glenmore Thornton LLP (Richard Okamura, Engagement Partner, and Vanessa Liu, Tax Partner), for services rendered in connection with financial, accounting, and tax due diligence, quality of earnings analysis, and structuring advice;
(v) Insurance broker fees of $680,000 payable to Peregrine Advisory Group LLC (Timothy Gallagher, Managing Director) in connection with the placement and negotiation of the R&W Insurance Policy;
(vi) R&W Insurance Policy premium of $13,600,000 payable to Northfield Assurance Ltd.;
(vii) Regulatory filing fees, including (A) HSR Act filing fees in connection with the Hart-Scott-Rodino filing made on February 9, 2024, and (B) CMA filing fees in connection with the CMA merger notice filed on February 12, 2024 (Case No. ME/7184/24);
(viii) Financing fees payable to Meridian Atlantic Bank, N.A. and Ironclad Capital Markets LLC in connection with the arrangement, structuring, and syndication of the debt financing for the Transaction, including arrangement fees, underwriting fees, and the ticking fee of 0.25% per annum on the undrawn Term Loan B commitment commencing April 22, 2024;
(ix) Escrow agent fees payable to Cobalt Trust Company in connection with the establishment and administration of the escrow fund under the Escrow Agreement; and
(x) All other out-of-pocket costs and expenses incurred by the Investor Group in connection with the Transaction, including proxy solicitation fees, printing costs, travel expenses, and similar costs.
(c) The GP shall provide Co-Invest VI-A with a reasonably detailed summary of all Transaction Expenses promptly following the Closing, and shall provide periodic updates thereafter as additional Transaction Expenses are incurred.
Section 8.2 — Organizational Expenses
All organizational expenses of Co-Invest VI-A, including legal fees and expenses incurred in connection with the formation of Co-Invest VI-A, the preparation and negotiation of the Co-Invest VI-A LPA and the co-investment side letter agreements, accounting and audit setup costs, state and local filing fees, and similar organizational costs, shall be borne by Co-Invest VI-A and shall be allocated among the limited partners of Co-Invest VI-A in accordance with the Co-Invest VI-A LPA. The GP shall be entitled to advance such organizational expenses on behalf of Co-Invest VI-A and shall be reimbursed for all such advances from the capital contributions of Co-Invest VI-A's limited partners.
Section 8.3 — Indemnification of GP
(a) Co-Invest VI-A shall indemnify, defend, and hold harmless the GP, its members, managers, officers, employees, agents, and their respective successors and assigns (each, a "GP Indemnified Party") from and against any and all losses, liabilities, damages, claims, costs, and expenses (including reasonable attorneys' fees and disbursements) arising out of or resulting from (i) any breach by Co-Invest VI-A of any representation, warranty, covenant, or agreement contained in this Agreement, or (ii) any failure by Co-Invest VI-A or any of its limited partners to fund any portion of the Co-Investment Amount or any other amount required to be funded pursuant to this Agreement when due.
(b) Notwithstanding the foregoing, no GP Indemnified Party shall be entitled to indemnification under this Section 8.3 to the extent that such losses, liabilities, damages, claims, costs, or expenses arise from or are attributable to the gross negligence, willful misconduct, or fraud of such GP Indemnified Party. Nothing in this Section 8.3 shall limit any other rights or remedies that any GP Indemnified Party may have under the Co-Invest VI-A LPA, the Fund VI LPA, or applicable law.
ARTICLE IX — TERM AND TERMINATION