1041-00004 · Solara Digital Infrastructure LP · Ancillary Agreements

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PRIVILEGED AND CONFIDENTIAL — ATTORNEY WORK PRODUCT — DRAFT FOR DISCUSSION PURPOSES ONLY

DRAFT — ROLLOVER AGREEMENT — OUTLINE AND TERM SHEET

PROJECT TRIDENT

Matter Number: 1041-00004 Transaction Code Name: Project Trident Engagement Letter Reference: 1041-00004

Date: [Undated — for circulation with first draft SPA package]

Prepared by:

Calderwood & Harkness LLP 277 Park Avenue, 45th Floor New York, NY 10172

James Prentice, Responsible Partner Sylvia Hartwell, Tax Specialist Partner Andrew Fitzpatrick, Lead Associate

Prepared for:

Solara Digital Infrastructure LP 1200 Market Street, Suite 2400 Wilmington, DE 19801

Attention: Viktor Sorensen, Managing Partner

Claire Nakamura, Partner, Head of Software Investing

This memorandum is a confidential attorney-client privileged communication prepared in connection with Engagement Letter Reference 1041-00004 and is intended solely for the use of the addressees identified above. This document constitutes attorney work product and is protected from disclosure under applicable law. Distribution, reproduction, or use of this memorandum by any person other than the intended recipients without the prior written consent of Calderwood & Harkness LLP is strictly prohibited. This memorandum does not constitute a binding agreement and is prepared solely for discussion purposes.

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I. INTRODUCTION AND PURPOSE

This memorandum sets forth the proposed outline and key terms for the Rollover Agreement (the "Rollover Agreement") to be entered into by Garrett Holliday ("Holliday") and Solara Fleet Holdings LLC ("AcquisitionCo" or "Buyer") in connection with the acquisition (the "Acquisition") of 100% of the issued and outstanding shares of common stock and Series A Preferred Stock of Meridian FleetWorks, Inc. ("MFW" or the "Company") by AcquisitionCo.

Pursuant to the Letter of Intent dated February 18, 2026 (Reference: LOI-MFW-2026-0218) (the "LOI"), Holliday has agreed to roll over a portion of his equity consideration into AcquisitionCo in lieu of receiving all-cash consideration at closing. The LOI contemplates that Holliday will contribute approximately $25,000,000 of his equity consideration into AcquisitionCo in exchange for membership interests therein, thereby maintaining a continuing economic interest in the post-closing enterprise alongside Solara Fund III, LP ("Fund III"). The arrangement is intended to align the interests of Holliday, as the Company's co-founder and continuing Chief Executive Officer, with those of the private equity sponsor over the anticipated hold period.

The Rollover Agreement will be an ancillary agreement to the Stock Purchase Agreement (the "SPA") to be entered into among AcquisitionCo, MFW, and the stockholders of MFW. Execution and delivery of the Rollover Agreement by Holliday will be a condition to AcquisitionCo's obligation to consummate the closing of the SPA. Similarly, the rollover transaction will be consummated simultaneously with, and contingent upon, the closing of the Acquisition.

The terms of the Rollover Agreement will need to be consistent with, and in certain instances implemented through, the Amended and Restated Limited Liability Company Agreement of Solara Fleet Holdings LLC (the "LLC Agreement"), which will be separately drafted and negotiated. Where provisions of the Rollover Agreement address economic rights, governance matters, or transfer restrictions, those provisions must be mirrored in the LLC Agreement to ensure enforceability and consistency between the two documents. The drafting team should coordinate the preparation of these two agreements in parallel, with cross-references maintained throughout.

Holliday's counsel at Hawthorne Kinsey & Alcott LLP (Rachel Greenwald, lead partner; Timothy Cho, associate counsel) is expected to negotiate the Rollover Agreement on Holliday's behalf. We anticipate meaningful negotiation on several key provisions, as identified in the open issues section of this memorandum (Section XV below). Calderwood & Harkness LLP will represent AcquisitionCo and Solara in all negotiations related to the Rollover Agreement.

The purpose of this memorandum is to provide the Solara deal team with a comprehensive overview of the proposed terms, identify key structuring considerations (including the critical tax analysis under Sections 721, 704(c), and 707 of the Internal Revenue Code), flag anticipated negotiation points, and establish a framework for the preparation of the definitive Rollover Agreement. This memorandum is intended to serve as the basis for internal discussion and approval prior to the preparation of definitive documentation.

II. PARTIES

A. Garrett Holliday

Garrett Holliday is the co-founder, Chief Executive Officer, and a member of the board of directors of Meridian FleetWorks, Inc. Holliday has served as CEO of MFW since the Company's founding in 2015 and has been principally responsible for the Company's growth from an early-stage startup to its current position as a leading provider of fleet management and logistics SaaS solutions. His principal residence is located in McLean, Virginia.

As of the date of this memorandum, Holliday's current equity holdings in MFW are as follows:

The foregoing holdings are calculated based on a fully diluted share count of 10,000,000 shares of MFW equity, which accounts for all outstanding common stock, Series A Preferred Stock, and the conversion or exercise (as applicable) of all outstanding options, warrants, and other convertible securities of MFW. Holliday's aggregate 32.0% equity stake makes him the single largest individual stockholder of MFW.

Under the terms of the SPA, the aggregate purchase price for 100% of MFW's fully diluted equity is $350,000,000, resulting in a per-share price of $35.00 ($350,000,000 ÷ 10,000,000 fully diluted shares). Accordingly, Holliday's total pre-rollover consideration equals 3,200,000 shares multiplied by $35.00 per share, or $112,000,000 in the aggregate. This amount is subject to the standard adjustments under the SPA, including the net working capital adjustment (against a target of $5,800,000), cash and debt adjustments at closing, and the allocation of MFW transaction expenses (estimated at approximately $12,000,000).

Holliday is expected to continue serving as the Chief Executive Officer of MFW following the closing of the Acquisition, subject to the terms of a post-closing employment agreement to be separately negotiated between Holliday and MFW (as a wholly-owned subsidiary of AcquisitionCo). The terms of Holliday's post-closing employment, including base salary, bonus targets, equity incentive arrangements, and severance protections, will be addressed in a separate employment agreement and are not the subject of this Rollover Agreement, although certain provisions of the Rollover Agreement (including put/call trigger events and governance rights) will be conditioned upon and interact with Holliday's employment status.

Holliday's current employment agreement with MFW (effective January 1, 2023) provides for a base salary of $425,000 per annum, an annual bonus target of 75% of base salary ($318,750), and a 24-month change-of-control severance provision. The existing employment agreement will be superseded by the post-closing employment arrangements, and the interaction between the change-of-control severance provision and the Acquisition closing must be addressed in the SPA and the funds flow.

B. Solara Fleet Holdings LLC (AcquisitionCo)

Solara Fleet Holdings LLC is a Delaware limited liability company to be newly formed as a wholly-owned subsidiary of Solara Fund III, LP (EIN: 84-6239017) prior to the closing of the Acquisition. As of the date of this memorandum, AcquisitionCo has not yet been formed. Formation will be effectuated by the filing of a Certificate of Formation with the Delaware Secretary of State, and an Employer Identification Number will be obtained from the Internal Revenue Service promptly upon formation. The registered office of AcquisitionCo will be established in the State of Delaware, and a registered agent will be designated in accordance with the Delaware Limited Liability Company Act (6 Del. C. § 18-101 et seq.).

Solara Fund III, LP is a Delaware limited partnership with approximately $1.85 billion in committed capital. Fund III is managed by its general partner, Solara Digital Infrastructure GP LLC, a Delaware limited liability company (the "General Partner"). The General Partner exercises investment authority over Fund III's committed capital and will be responsible for all investment decisions with respect to the Acquisition, including the negotiation and approval of the terms of the Rollover Agreement. For purposes of this memorandum, references to "Solara" include, as the context may require, Fund III, the General Partner, and their respective affiliates and related entities.

AcquisitionCo will be the direct purchaser of all issued and outstanding shares of common stock and Series A Preferred Stock of MFW under the SPA. Upon the consummation of the Acquisition, AcquisitionCo will hold 100% of the equity of MFW and will serve as the direct holding entity through which Fund III and Holliday (as the rollover investor) will hold their respective economic interests in the post-closing enterprise.

The capitalization of AcquisitionCo at closing will consist of the following:

The senior secured credit facility will be provided by a syndicate led by Ironclad National Bank, N.A., as administrative agent, and Ridgeline Commercial Lending Corp., as co-lender. The $125,000,000 Term Loan A will be drawn at closing to fund a portion of the aggregate purchase price. The terms of the credit facility are being negotiated separately and will be documented in a definitive credit agreement. The remaining $25,000,000 in the sources and uses table above reflects either additional equity from Fund III or mezzanine/subordinated debt, the specific allocation of which is to be finalized by the Solara deal team in coordination with the financing workstream.

III. ROLLOVER EQUITY — VALUATION AND MECHANICS

A. Rollover Amount

Holliday will contribute a portion of his equity consideration equal to approximately $25,000,000 in value (the "Rollover Amount") to AcquisitionCo in exchange for Class B Common Units. This Rollover Amount represents approximately 7.14% of the aggregate $350,000,000 deal value ($25,000,000 ÷ $350,000,000 ≈ 7.14%) and approximately 22.32% of Holliday's total pre-rollover consideration of $112,000,000 ($25,000,000 ÷ $112,000,000 ≈ 22.32%).

The $25,000,000 Rollover Amount will be expressed as a fixed dollar amount in the Rollover Agreement, subject to confirmation at or prior to closing. The parties intend that the Rollover Amount will not be subject to adjustment under the SPA's customary purchase price adjustment mechanisms (net working capital, cash, debt, and transaction expense adjustments), as those mechanisms affect the aggregate purchase price and per-share consideration payable to all stockholders of MFW generally, rather than the specific commitment of Holliday to contribute a fixed dollar amount of value to AcquisitionCo. The mechanics for determining the number of MFW shares (or dollar equivalent) to be contributed at closing are addressed in Section III.C below.

Holliday's net cash proceeds at closing, before giving effect to his pro rata share of the escrow holdback and MFW transaction expenses, will be approximately $87,000,000, calculated as follows:

The foregoing estimates are preliminary and subject to change based on the final determination of the per-share consideration, net working capital adjustments, and actual transaction expenses. The precise calculation of Holliday's net cash proceeds will be set forth in the funds flow memorandum to be prepared in connection with the closing.

B. Contribution Mechanics

At closing, rather than receiving the full cash consideration for his shares of MFW otherwise payable under the SPA, Holliday will contribute shares of MFW common stock and/or Series A Preferred Stock (or, alternatively, the right to receive a portion of his closing cash consideration) to AcquisitionCo in exchange for Class B Common Units.

The contribution will be effectuated simultaneously with, and contingent upon, the closing of the SPA. The precise sequence of the closing steps will be documented in the closing mechanics section of the SPA and the funds flow memorandum, but it is anticipated that the contribution will occur as an integrated step in the closing process, such that Holliday's contribution to AcquisitionCo and AcquisitionCo's acquisition of 100% of the MFW equity occur as part of a single, integrated transaction.

The specific shares to be contributed (common stock, Series A Preferred Stock, or a combination thereof) and the mechanics of the contribution (direct contribution of MFW shares versus a deemed cash contribution) will be determined based on tax optimization considerations. As discussed more fully in Section IX below, the preferred approach from a tax perspective is a direct contribution of MFW shares to AcquisitionCo under Section 721 of the Internal Revenue Code, in order to achieve tax-deferred treatment. If the rollover is structured as a deemed cash contribution — i.e., Holliday receives cash consideration under the SPA and simultaneously contributes that cash to AcquisitionCo — the step transaction doctrine risk must be carefully evaluated. Calderwood & Harkness's tax team, led by Sylvia Hartwell, will prepare a detailed analysis of the structuring alternatives and provide a recommendation prior to the finalization of the definitive documentation.

In connection with the contribution, Holliday will represent and warrant that the contributed shares are free and clear of all liens, pledges, security interests, charges, claims, encumbrances, and restrictions of any kind, other than restrictions under the MFW Stockholders' Agreement dated as of July 15, 2017 (as amended), which restrictions will terminate in their entirety at or prior to the closing of the Acquisition. The specific MFW shares to be contributed will be identified on Schedule 1 to the Rollover Agreement, including share certificate numbers (or book-entry references), classes, and quantities.

In exchange for the contribution, AcquisitionCo will issue to Holliday such number of Class B Common Units of AcquisitionCo as corresponds to the Rollover Amount, as determined in accordance with Section IV below.

C. Pre-Closing Adjustments

As noted above, the Rollover Amount is fixed at $25,000,000 and will not itself be subject to the net working capital adjustment, cash/debt adjustment, or transaction expense adjustment mechanisms set forth in the SPA. Those adjustment mechanisms affect the aggregate purchase price payable by AcquisitionCo to all MFW stockholders and, consequently, the per-share consideration, but do not alter Holliday's commitment to contribute $25,000,000 of value to AcquisitionCo.

However, the number of MFW shares (or the dollar equivalent) to be contributed by Holliday will be determined by reference to the per-share merger consideration as finally calculated under the SPA at closing. Specifically:

(a) If the per-share consideration is equal to the base $35.00 per share, Holliday will contribute 714,286 shares of MFW stock (calculated as $25,000,000 ÷ $35.00 per share, rounded to the nearest whole share), or such combination of common stock and Series A Preferred Stock as may be agreed.

(b) If the per-share consideration is adjusted from the base $35.00 per share (whether upward or downward) as a result of the SPA's purchase price adjustment mechanisms, the number of shares to be contributed will adjust proportionally so that the aggregate dollar value of the contributed shares remains as close as practicable to $25,000,000.

(c) In no event will the Rollover Amount exceed $25,000,000 or fall below $25,000,000, except to the extent of immaterial rounding adjustments necessitated by the application of a whole-share calculation to the adjusted per-share consideration.

This adjustment mechanism ensures that Holliday's rollover commitment is denominated in fixed dollar terms, with the share count serving as the variable, rather than the reverse. The parties will confirm the precise number of shares to be contributed and the per-share consideration at or prior to closing, and such confirmation will be reflected in a closing certificate to be delivered at closing.

IV. MEMBERSHIP INTEREST IN ACQUISITIONCO

A. Class of Membership Interest

In exchange for the contribution of the Rollover Amount, Holliday will receive Class B Common Units of Solara Fleet Holdings LLC. The LLC Agreement of AcquisitionCo will provide for two classes of common membership interests:

(i) Class A Common Units, to be held by Solara Fund III, LP, representing Fund III's equity contribution of $175,000,000 to AcquisitionCo; and

(ii) Class B Common Units, to be held by Holliday, representing the $25,000,000 Rollover Amount contributed by Holliday.

The relative rights, preferences, and privileges of Class A Common Units and Class B Common Units will be set forth in detail in the LLC Agreement. Unless otherwise specified in the LLC Agreement, both classes of units will carry the economic and governance rights described in this memorandum.

The Class B Common Units to be issued to Holliday will represent 12.5% of the total equity capitalization of AcquisitionCo at closing, calculated as the Rollover Amount ($25,000,000) divided by the total equity capitalization ($175,000,000 equity contribution from Fund III plus $25,000,000 rollover contribution from Holliday, totaling $200,000,000 of equity). It should be noted that the $125,000,000 in debt financing from Ironclad National Bank, N.A. and Ridgeline Commercial Lending Corp. constitutes leverage at the AcquisitionCo level and does not constitute equity for purposes of computing Holliday's percentage ownership interest.

Note to drafting team: There is an ambiguity in the LOI regarding the characterization of Holliday's percentage interest. The LOI references Holliday's rollover as representing "approximately 7.14% of deal value," which is calculated as $25,000,000 ÷ $350,000,000 (total enterprise value). However, Holliday's economic interest in the equity vehicle — AcquisitionCo — is properly 12.5% ($25,000,000 ÷ $200,000,000 equity capitalization). This distinction is material because it affects Holliday's share of distributions, his dilution protections, and the economic substance of the rollover. Clarification should be obtained from the Solara deal team (Viktor Sorensen / Claire Nakamura) as to which percentage figure governs, and the Rollover Agreement and LLC Agreement should be drafted to eliminate any ambiguity. We recommend that the definitive documents expressly state Holliday's percentage interest as 12.5% of the equity capitalization and define "Percentage Interest" accordingly.

B. Economic Rights

The Class B Common Units will participate pari passu with the Class A Common Units in all distributions made by AcquisitionCo, subject to the distribution waterfall to be set forth in the LLC Agreement. The distribution waterfall is expected to include the following tiers:

(i) Return of Capital. First, distributions to all members (Class A and Class B holders) pro rata in proportion to their respective capital contributions, until each member has received aggregate distributions equal to its total capital contributions.

(ii) Preferred Return (if applicable). Second, distributions to Class A holders (Solara Fund III, LP) until such holders have received a preferred return on their contributed capital. Solara's standard fund terms provide for an 8% per annum compounding preferred return to Fund investors. The applicability of a preferred return to Class A holders in the context of the AcquisitionCo structure, and the rate and compounding mechanics thereof, will be a key negotiation point with Holliday. See Section XV.A.5 (Open Issues) below.

(iii) Pro Rata Distributions. Third, following the satisfaction of the return of capital and any preferred return, all remaining distributions to be made pro rata to all members based on their respective percentage interests (12.5% to Holliday; 87.5% to Fund III).

To the extent the parties agree on a management promote or carried interest feature for Holliday's participation above the preferred return threshold, such feature will be documented in the LLC Agreement. A management promote would typically provide Holliday with a disproportionate share of distributions above a specified return threshold (e.g., 20% of distributions above a 2.0x return on invested capital to Fund III), which would serve as an additional incentive mechanism aligned with post-closing value creation. The specific terms of any promote arrangement, including hurdle rates, catch-up mechanics, and clawback provisions, are to be negotiated.

Tax distributions will be made to all members (including Holliday) in amounts sufficient to cover their estimated tax liabilities attributable to allocations of taxable income from AcquisitionCo. Tax distributions will be calculated based on the highest marginal combined federal and state income tax rate applicable to an individual resident in the highest-tax jurisdiction in which any member resides, applied to each member's allocable share of AcquisitionCo's taxable income for the applicable period. Tax distributions will be treated as advances against, and will reduce, subsequent distributions under the waterfall described above.

C. Capital Account

Holliday's initial capital account in AcquisitionCo will be credited with the fair market value of the contributed consideration, which is $25,000,000. Capital accounts will be maintained in accordance with the rules set forth in Treasury Regulation § 1.704-1(b)(2)(iv), including the requirements for proper maintenance of capital accounts in connection with contributions of property, distributions, and allocations of income, gain, loss, and deduction.

The LLC Agreement will include detailed capital account maintenance provisions, including provisions addressing the revaluation of capital accounts upon the occurrence of specified events (e.g., the admission of a new member, the distribution of property, or a liquidation of AcquisitionCo), in accordance with the "book-up" and "book-down" rules of Treasury Regulation § 1.704-1(b)(2)(iv)(f). Proper capital account maintenance is essential to support the allocations of income, gain, loss, and deduction under the LLC Agreement and to ensure that such allocations will be respected by the Internal Revenue Service under the substantial economic effect safe harbor of Treasury Regulation § 1.704-1(b)(2).

V. GOVERNANCE RIGHTS

A. Board / Manager Designation Rights

AcquisitionCo will be a manager-managed limited liability company under the Delaware Limited Liability Company Act, 6 Del. C. § 18-101 et seq. The management and affairs of AcquisitionCo will be vested in a board of managers (the "Board") or such other managing body as may be established under the LLC Agreement.

Solara Fund III, LP (acting through Solara Digital Infrastructure GP LLC, its general partner) will have the right to designate a majority of the managers of AcquisitionCo. Solara's control over the Board is consistent with standard private equity sponsor governance practices and is essential to the exercise of Fund III's investment authority and fiduciary obligations to its limited partners.

With respect to Holliday's governance rights, the drafting team proposes the following:

Proposed Approach (Solara's Preference): Holliday will receive board observer rights (non-voting) on the Board of AcquisitionCo. As a board observer, Holliday will be entitled to receive notice of all Board meetings, attend all Board meetings (whether in person or by teleconference), receive all materials distributed to members of the Board, and participate in Board discussions, but will not be entitled to vote on any matter before the Board. The board observer rights will be subject to the following conditions:

(a) Holliday must hold at least 50% of his initial Class B Common Units (i.e., units with a value of at least $12,500,000 at the time of issuance);

(b) Holliday must remain employed as the Chief Executive Officer of MFW; and

(c) The Board may exclude Holliday from portions of any Board meeting, and withhold any materials, to the extent reasonably necessary to preserve attorney-client privilege or to address matters in which Holliday has a personal conflict of interest.

Alternative Approach (Anticipated Holliday Negotiating Position): Holliday will have the right to designate one (1) manager to serve on a five-member Board, with Solara designating the remaining four (4) managers. The Holliday-designated manager would be a full voting member of the Board, entitled to all rights and subject to all duties of a manager under the LLC Agreement and applicable law.

Under either approach, Holliday's observer rights or manager designation rights will terminate automatically upon the occurrence of any of the following events:

(a) Holliday's cessation of employment with MFW for any reason, whether voluntary or involuntary, with or without cause;

(b) Holliday's transfer (other than a permitted transfer under Section VI below) of more than 50% of his initial Class B Common Units; or

(c) A qualifying liquidity event, including a sale of 100% of the equity of AcquisitionCo or MFW, a merger, an initial public offering, or a recapitalization that results in a change of control.

The Solara deal team should consider its preference on this point in advance of negotiations. Preserving plenary sponsor control over the Board is strongly recommended as a general principle, and the board observer approach is consistent with Solara's practice in prior fund investments. However, given Holliday's significant rollover commitment ($25,000,000) and his continuing role as CEO of the portfolio company, some accommodation of governance participation may be necessary to reach agreement.

B. Consent Rights

In addition to any governance rights described above, Holliday will have consent rights (or, at a minimum, advance notice rights) over certain "Major Decisions" affecting AcquisitionCo and MFW. The concept of Major Decision consent rights is standard in rollover transactions involving significant management equity participation and serves to protect the rollover investor against actions by the sponsor that could disproportionately impair the value of the management equity.

The proposed list of Major Decisions requiring Holliday's consent is as follows:

(a) Dilutive Issuances. The issuance of additional equity interests of AcquisitionCo (including options, warrants, or convertible securities) that would dilute the Class B Common Units below a specified threshold. The threshold is to be negotiated; Calderwood & Harkness suggests 5.0% of total equity capitalization as the floor below which dilution would trigger the consent right. Any issuances above the threshold but below Holliday's initial percentage interest would be subject to pre-emptive rights or anti-dilution protections, rather than a veto.

(b) Material Indebtedness. The incurrence by AcquisitionCo or MFW of material indebtedness in excess of a specified threshold. The threshold amount is to be negotiated and should be calibrated to the existing senior secured credit facility ($125,000,000 Term Loan A). We suggest a threshold of $10,000,000 in incremental indebtedness above the amounts outstanding under the existing credit facility at closing.

(c) Sale, Merger, or Liquidation. Any sale, merger, consolidation, recapitalization, or voluntary liquidation of AcquisitionCo or MFW, or any disposition of all or substantially all of the assets of AcquisitionCo or MFW. This consent right is subject to the drag-along provisions described in Section VII.B below — in the event Solara exercises its drag-along right, Holliday's consent will not be required, provided the drag-along conditions are satisfied.

(d) Adverse LLC Agreement Amendments. Any amendment, modification, or waiver of any provision of the LLC Agreement that would materially and adversely affect the rights, preferences, or privileges of the Class B Common Units on a disproportionate basis relative to the Class A Common Units.

(e) Related-Party Transactions. The entry into any transaction between AcquisitionCo or MFW, on the one hand, and Solara or any of its affiliates (including other Solara portfolio companies, Solara management company entities, and Solara personnel), on the other hand, that is outside the ordinary course of business. This provision is intended to address potential conflicts of interest inherent in the sponsor-portfolio company relationship, including management fees, monitoring fees, transaction fees, and intercompany service arrangements.

Solara will retain plenary control over all other matters affecting AcquisitionCo and MFW, consistent with customary private equity sponsor governance norms. The consent rights described above are intended to be narrowly tailored to protect against actions that could disproportionately impair the economic interests of the Class B holders, rather than to provide Holliday with a general governance veto.

C. Information Rights

Holliday will be entitled to receive the following information with respect to AcquisitionCo and MFW, subject to customary confidentiality obligations:

(a) Quarterly unaudited financial statements of AcquisitionCo and MFW, to be delivered within 45 days following the end of each fiscal quarter;

(b) Annual audited financial statements of AcquisitionCo and MFW, to be delivered within 90 days following the end of each fiscal year;

(c) Annual operating budgets of AcquisitionCo and MFW, to be delivered at least 30 days prior to the beginning of each fiscal year;

(d) Such other financial and operational information as Holliday may reasonably request from time to time, subject to AcquisitionCo's reasonable determination that the provision of such information would not impose an undue burden or compromise proprietary business information; and

(e) Tax information, including Schedule K-1 (Form 1065) and any other tax reporting documents necessary for Holliday to prepare his personal income tax returns, to be provided within 90 days following the end of each fiscal year of AcquisitionCo.

All information provided to Holliday pursuant to these information rights will be subject to the confidentiality obligations set forth in the Rollover Agreement and the LLC Agreement, as well as any confidentiality obligations to which Holliday is subject under his employment arrangements with MFW.

VI. TRANSFER RESTRICTIONS

A. General Lock-Up

Holliday may not transfer, sell, assign, pledge, hypothecate, encumber, or otherwise dispose of (collectively, "Transfer") any of his Class B Common Units, or any interest therein, without the prior written consent of Solara Fund III, LP (acting through its general partner, Solara Digital Infrastructure GP LLC), which consent may be withheld in Solara's sole and absolute discretion, subject to the limited exceptions set forth in Section VI.B below.

The general prohibition on Transfers will be in effect for a minimum lock-up period of three (3) years from the date of the closing of the Acquisition (the "Lock-Up Period"). The three-year Lock-Up Period is coterminous with the three-year term of Holliday's non-competition covenant under the Restrictive Covenant Agreement (see Section VIII below), reflecting the alignment between Holliday's continued commitment to the enterprise and the restriction on his ability to monetize his equity investment.

Following the expiration of the Lock-Up Period, Transfers will be permitted only with the prior written consent of Solara Fund III, LP (which consent may be withheld in Solara's reasonable discretion) and will be subject to the right of first refusal described in Section VI.C below. No Transfer may be made at any time to a competitor of MFW, an individual or entity that is subject to sanctions or debarment under applicable law, or any person or entity that Solara reasonably determines to be an unsuitable transferee.

B. Permitted Transfers

Notwithstanding the general lock-up described above, the following Transfers will be permitted without Solara's prior written consent at any time (including during the Lock-Up Period):

(a) Transfers by Holliday to his spouse, children, grandchildren, siblings, parents, or other members of his immediate family (collectively, "Family Members");

(b) Transfers by Holliday to a trust established primarily for the benefit of Holliday or one or more of his Family Members, provided that Holliday serves as the trustee of such trust or retains control over the voting and disposition of the transferred Class B Common Units;

(c) Transfers by Holliday to a limited liability company, partnership, corporation, or other entity in which Holliday and/or one or more of his Family Members are the sole equity holders and over which Holliday retains control;

(d) Transfers by Holliday in connection with bona fide estate planning transactions, including transfers to a family limited partnership, grantor retained annuity trust (GRAT), or similar estate planning vehicle; and

(e) Transfers by operation of law, including transfers by will, by intestate succession, or pursuant to a court order in connection with divorce proceedings (subject to any applicable domestic relations order).

As a condition to any permitted Transfer, the proposed transferee must execute and deliver to AcquisitionCo a joinder agreement (substantially in the form attached to the Rollover Agreement as Exhibit C) pursuant to which the transferee agrees to be bound by all of the terms and conditions of the Rollover Agreement and the LLC Agreement, including the transfer restrictions, tag-along and drag-along provisions, and confidentiality obligations, as if the transferee were an original party thereto. No permitted Transfer will relieve Holliday of his obligations under the Rollover Agreement or the Restrictive Covenant Agreement.

C. Right of First Refusal (ROFR)

If, following the expiration of the Lock-Up Period, Holliday proposes to Transfer any of his Class B Common Units (other than in a permitted Transfer described in Section VI.B above) and Solara has consented to such Transfer, Solara Fund III, LP (or, at Solara's election, AcquisitionCo) will have a right of first refusal ("ROFR") to purchase the Class B Common Units proposed to be Transferred, on the following terms:

(a) Transfer Notice. Holliday will deliver a written notice (the "Transfer Notice") to Solara Fund III, LP and AcquisitionCo identifying the proposed transferee, the number of Class B Common Units proposed to be Transferred, the proposed purchase price and other material terms of the proposed Transfer, and a copy of any written offer, term sheet, letter of intent, or agreement (whether binding or non-binding) relating to the proposed Transfer.

(b) Exercise Period. Solara Fund III, LP (or AcquisitionCo) will have a period of thirty (30) calendar days following receipt of the Transfer Notice (the "ROFR Exercise Period") within which to deliver written notice to Holliday of its election to purchase all (but not less than all) of the Class B Common Units identified in the Transfer Notice, at the price and on the terms set forth in the Transfer Notice.

(c) Consummation of ROFR Purchase. If Solara Fund III, LP (or AcquisitionCo) elects to exercise the ROFR, the closing of the ROFR purchase will occur within thirty (30) calendar days following the date of exercise, or such longer period as may be required to obtain any regulatory approvals.

(d) Lapse of ROFR. If Solara Fund III, LP (or AcquisitionCo) does not exercise the ROFR within the ROFR Exercise Period, Holliday may complete the proposed Transfer to the third-party transferee identified in the Transfer Notice, on terms and conditions no less favorable to Holliday than those set forth in the Transfer Notice, and at a price not less than the price set forth in the Transfer Notice, provided that the Transfer is consummated within ninety (90) calendar days following the expiration of the ROFR Exercise Period. If the Transfer is not consummated within such 90-day period, the Class B Common Units will again become subject to the ROFR, and Holliday must deliver a new Transfer Notice before proceeding with any subsequent proposed Transfer.

D. Compliance with Securities Laws

All Transfers of Class B Common Units must comply with applicable federal and state securities laws, including the Securities Act of 1933, as amended (the "Securities Act"), and any applicable state "blue sky" laws. The Class B Common Units will not be registered under the Securities Act, and accordingly, any Transfer will be permitted only if (i) the Transfer is made pursuant to an effective registration statement under the Securities Act, (ii) the Transfer is exempt from registration under the Securities Act (including, without limitation, pursuant to Rule 144, Section 4(a)(1), Section 4(a)(1½), or Section 4(a)(7) of the Securities Act), or (iii) AcquisitionCo has received an opinion of counsel reasonably acceptable to AcquisitionCo to the effect that no registration is required.

Each certificate (or book entry) representing Class B Common Units will bear a customary restrictive legend substantially in the following form:

"THE MEMBERSHIP INTERESTS REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR UNDER ANY STATE SECURITIES LAWS AND MAY NOT BE OFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, OR OTHERWISE DISPOSED OF EXCEPT IN COMPLIANCE WITH SUCH LAWS AND THE TERMS OF THE LIMITED LIABILITY COMPANY AGREEMENT OF SOLARA FLEET HOLDINGS LLC."

VII. TAG-ALONG AND DRAG-ALONG RIGHTS

A. Tag-Along (Co-Sale) Rights

If Solara Fund III, LP proposes to sell or transfer fifty percent (50%) or more of its Class A Common Units to a bona fide third party (other than to an affiliate of Solara Fund III, LP), Holliday will have the right (but not the obligation) to participate in such sale on a pro rata basis, on the same terms and conditions as those applicable to Solara Fund III, LP's sale (the "Tag-Along Right").

The Tag-Along Right will operate as follows:

(a) Tag-Along Notice. Solara Fund III, LP will deliver to Holliday a written notice (the "Tag-Along Notice") at least twenty (20) business days prior to the anticipated closing of the proposed sale, identifying the proposed purchaser, the number of Class A Common Units to be sold, the proposed per-unit purchase price, and the other material terms and conditions of the proposed sale.

(b) Exercise. Holliday will have a period of fifteen (15) business days following receipt of the Tag-Along Notice within which to deliver written notice to Solara Fund III, LP of his election to exercise the Tag-Along Right with respect to all or any portion of his Class B Common Units, on a pro rata basis. Holliday's pro rata share will be calculated based on the ratio of Holliday's total Class B Common Units to the total outstanding common units (Class A and Class B) of AcquisitionCo.

(c) Terms of Participation. If Holliday exercises his Tag-Along Right, the proposed purchaser will be required to purchase Holliday's Class B Common Units (to the extent of his pro rata share) on the same terms and conditions (including per-unit price, representations, warranties, indemnities, and escrow arrangements) applicable to Solara Fund III, LP's sale. If the proposed purchaser is unwilling to purchase Holliday's pro rata share of units, Solara Fund III, LP will reduce the number of Class A Common Units to be sold so as to accommodate Holliday's tag-along participation.

(d) Failure to Exercise. If Holliday does not exercise his Tag-Along Right within the 15-business-day exercise period, Solara Fund III, LP may proceed with the proposed sale without Holliday's participation, subject to the other provisions of the LLC Agreement.

The Tag-Along Right will not apply to transfers by Solara Fund III, LP to its affiliates (including transfers to successor funds, parallel funds, co-investment vehicles, or any entity under common control with Solara Digital Infrastructure GP LLC), provided that the transferee assumes all obligations of Solara Fund III, LP under the LLC Agreement and the Rollover Agreement.

B. Drag-Along Rights

If Solara Fund III, LP proposes to sell or transfer 100% of the equity of AcquisitionCo (or to cause a sale, merger, consolidation, or other liquidity event involving AcquisitionCo or MFW) to a bona fide, unaffiliated third party (a "Drag-Along Sale"), Solara Fund III, LP will have the right to require Holliday to sell all of his Class B Common Units in connection with such Drag-Along Sale, on the same terms and conditions applicable to Solara Fund III, LP (the "Drag-Along Right").

The Drag-Along Right will apply to any transaction that results in, or is structured to result in, a change of control of AcquisitionCo or MFW, including without limitation:

(a) A sale of 100% of the outstanding membership interests of AcquisitionCo;

(b) A merger or consolidation of AcquisitionCo or MFW with or into another entity, in which the members of AcquisitionCo immediately prior to the transaction do not retain a majority of the equity interests in the surviving entity;

(d) Any other transaction or series of related transactions that results in a change of control.

Upon exercise of the Drag-Along Right by Solara Fund III, LP:

(a) Holliday will be required to sell all of his Class B Common Units and execute and deliver all documents, agreements, instruments, and certificates reasonably required to consummate the Drag-Along Sale, including stock powers, letters of transmittal, voting agreements, and support agreements.

(b) Holliday will receive per-unit consideration for his Class B Common Units that is no less favorable than the per-unit consideration received by Solara Fund III, LP for its Class A Common Units, calculated on an as-converted and fully diluted basis after giving effect to the distribution waterfall in the LLC Agreement.

(c) Holliday will be required to participate in any indemnification arrangements, escrow holdbacks, or purchase price adjustments in the Drag-Along Sale on a pro rata basis, consistent with his percentage interest in AcquisitionCo.

(d) Holliday will not be required to provide representations, warranties, or indemnification in connection with the Drag-Along Sale beyond those representations and warranties customary for a selling equityholder. Specifically, Holliday's representations and warranties will be limited to: (i) his title to the Class B Common Units, free and clear of liens; (ii) his authority to consummate the sale; (iii) the absence of conflicts with agreements to which he is a party; and (iv) the absence of broker's or finder's fees owed by Holliday. Under no circumstances will Holliday be required to provide business-level representations, warranties, or indemnification regarding MFW, its operations, assets, liabilities, financial condition, or prospects.

The Drag-Along Right is a fundamental protection for the private equity sponsor and is non-negotiable in its core structure. However, the protections afforded to Holliday as a drag-along participant — particularly the requirement of no-less-favorable per-unit consideration and the limitation on representations and indemnities — are intended to ensure that Holliday is treated equitably in any liquidity event.

VIII. RESTRICTIVE COVENANTS (CROSS-REFERENCE)

The Rollover Agreement will incorporate by reference, or contain express cross-references to, the Restrictive Covenant Agreement to be entered into separately by Holliday in connection with the closing of the Acquisition (the "Restrictive Covenant Agreement"). The Restrictive Covenant Agreement will be negotiated as a separate ancillary agreement and will be the subject of a companion outline and term sheet to be prepared by the Calderwood & Harkness team.

For purposes of the Rollover Agreement, the key covenants under the Restrictive Covenant Agreement are summarized as follows:

(a) Non-Competition. For a period of three (3) years following the closing of the Acquisition (or, if later, three (3) years following the termination of Holliday's employment with MFW), Holliday will be restricted from directly or indirectly engaging in, owning, managing, operating, financing, or participating in any business that competes with MFW in the fleet management and logistics SaaS market. The geographic scope and specific carve-outs will be defined in the Restrictive Covenant Agreement.

(b) Non-Solicitation. For a period of three (3) years following the closing of the Acquisition (or, if later, three (3) years following the termination of Holliday's employment with MFW), Holliday will be restricted from directly or indirectly soliciting, recruiting, or hiring any employee of MFW, or soliciting, diverting, or taking away any customer, client, or business relationship of MFW.

(c) Confidentiality. Holliday will be subject to perpetual confidentiality obligations with respect to all proprietary information, trade secrets, and confidential business information of MFW and AcquisitionCo. The confidentiality obligations will survive the termination of Holliday's employment and the termination or expiration of the Rollover Agreement.

The Rollover Agreement will provide that a material breach by Holliday of any provision of the Restrictive Covenant Agreement constitutes a "Forfeiture Event" with respect to Holliday's Class B Common Units. Upon the occurrence of a Forfeiture Event, Solara Fund III, LP (or AcquisitionCo, at Solara's election) will have the right, but not the obligation, to repurchase all of Holliday's then-outstanding Class B Common Units at a price equal to the lower of (x) original cost (i.e., the Rollover Amount of $25,000,000, adjusted pro rata for any prior distributions or partial dispositions) and (y) the fair market value of the Class B Common Units as of the date of the Forfeiture Event, as determined in accordance with the valuation methodology set forth in Section X.C of this memorandum.

The forfeiture provision serves as a powerful enforcement mechanism for the restrictive covenants and is in addition to (not in lieu of) any other remedies available to AcquisitionCo, MFW, or Solara at law or in equity, including claims for damages and injunctive relief. Enforcement of the Restrictive Covenant Agreement, including the forfeiture provision, will be subject to the exclusive jurisdiction of the Court of Chancery of the State of Delaware (or the alternative courts specified in Section XIV.B below). The parties will agree in the Rollover Agreement and the Restrictive Covenant Agreement that specific performance and injunctive relief are available remedies in connection with any breach or threatened breach of the restrictive covenants.

IX. TAX TREATMENT

A. Intended Tax-Deferred Contribution — Section 721

The contribution of MFW equity (or the right to cash consideration) by Holliday to AcquisitionCo in exchange for Class B Common Units is intended to be treated as a tax-deferred contribution under Section 721 of the Internal Revenue Code of 1986, as amended (the "Code"). Section 721(a) provides, as a general rule, that no gain or loss shall be recognized to a partnership or to any of its partners in the case of a contribution of property to the partnership in exchange for an interest in the partnership.

Because AcquisitionCo will be a multi-member limited liability company (with Solara Fund III, LP and Holliday as its members), AcquisitionCo will be classified as a partnership for federal income tax purposes under the default classification rules of Treasury Regulation § 301.7701-3 (unless an affirmative election is made to be classified as a corporation, which is not anticipated). The contribution of MFW shares by Holliday to AcquisitionCo in exchange for Class B Common Units should therefore qualify for tax-deferred treatment under Section 721, provided the contribution satisfies the requirements of that section.

Under Section 721, neither Holliday nor AcquisitionCo will recognize gain or loss upon the contribution of MFW shares to AcquisitionCo in exchange for Class B Common Units. This treatment has the following consequences:

(a) Holliday's Basis in Class B Common Units. Under Section 722 of the Code, Holliday's tax basis in his Class B Common Units will equal the adjusted basis of the contributed property — i.e., Holliday's adjusted tax basis in the MFW shares contributed to AcquisitionCo. This "substituted basis" carries over from the contributed property to the partnership interest received in exchange therefor. If Holliday's adjusted tax basis in the contributed MFW shares is less than $25,000,000 (their fair market value), Holliday will have a built-in gain in his Class B Common Units equal to the difference.

(b) AcquisitionCo's Basis in Contributed Shares. Under Section 723 of the Code, AcquisitionCo's tax basis in the MFW shares contributed by Holliday will equal Holliday's adjusted tax basis in such shares immediately prior to the contribution. This "transferred basis" preserves the built-in gain (or loss) in the contributed property at the entity level.

(c) Holding Period. Under Section 1223(1), Holliday's holding period in his Class B Common Units will include his holding period in the contributed MFW shares. Under Section 1223(2), AcquisitionCo's holding period in the contributed MFW shares will include Holliday's holding period.

Critical Structuring Consideration: If the rollover is structured as a deemed cash contribution — i.e., Holliday receives cash consideration under the SPA and simultaneously contributes that cash to AcquisitionCo — there is a material risk that the Internal Revenue Service could invoke the step transaction doctrine to collapse the cash receipt and cash contribution into a single integrated transaction. If the step transaction doctrine applies, the IRS could recharacterize the transaction as a taxable sale of MFW shares by Holliday (to the extent of the cash received) combined with a separate contribution of property to AcquisitionCo, potentially resulting in Holliday recognizing gain on the entire cash consideration received (not just the portion in excess of the Rollover Amount).

To mitigate this risk, we strongly recommend structuring the rollover as a direct contribution of MFW shares to AcquisitionCo, rather than as a deemed cash contribution. In a direct share contribution, Holliday contributes his MFW shares to AcquisitionCo in a single step, and AcquisitionCo then acquires the remaining MFW shares from the other stockholders for cash under the SPA. This structure more clearly supports Section 721 treatment and minimizes step transaction risk.

Sylvia Hartwell is preparing a detailed tax analysis memorandum addressing the optimal structure for the rollover, the Section 721 analysis, and the interaction of the rollover with the potential Section 338(h)(10) election. If a Section 338(h)(10) election is made in connection with the Acquisition, the interaction with Holliday's rollover must be carefully evaluated. A Section 338(h)(10) election treats the stock purchase as a deemed asset sale by MFW for federal income tax purposes, which results in MFW recognizing gain on the deemed sale of its assets. The impact of a 338(h)(10) election on the tax-deferred nature of Holliday's Section 721 contribution is complex and requires analysis of whether the contribution and the deemed asset sale can coexist within the same transaction framework. This analysis will be set forth in a separate memorandum and should be finalized prior to the execution of definitive documentation.

B. Section 704(c) Allocations

To the extent there is a difference between the fair market value of the MFW shares contributed by Holliday ($25,000,000) and Holliday's adjusted tax basis in such shares, Section 704(c) of the Code will require that the "built-in gain" or "built-in loss" attributable to the contributed property be allocated to Holliday (as the contributing partner) upon a subsequent disposition of the contributed property by AcquisitionCo.

The purpose of Section 704(c) is to prevent the shifting of pre-contribution gains and losses among partners. If Holliday contributes MFW shares with a fair market value of $25,000,000 and an adjusted tax basis of, for example, $5,000,000, there would be $20,000,000 of built-in gain in the contributed property. Under Section 704(c), if AcquisitionCo subsequently sells or disposes of the contributed shares (or other property with a basis determined by reference to the contributed shares), the $20,000,000 of built-in gain must be allocated to Holliday.

The LLC Agreement should specify the Section 704(c) allocation method to be used in making the required allocations. The three methods available under the Treasury Regulations are:

(i) Traditional Method (Treas. Reg. § 1.704-3(b)): Allocates built-in gain to the contributing partner but does not create offsetting "remedial" allocations to the other partners. The traditional method can result in a "ceiling rule" limitation, which may cause non-contributing partners (i.e., Solara Fund III) to bear a disproportionate share of the tax burden.

(ii) Traditional Method with Curative Allocations (Treas. Reg. § 1.704-3(c)): Allocates built-in gain to the contributing partner and permits "curative" allocations of other items of income, gain, loss, or deduction to offset the ceiling rule limitation. This method produces a more economically accurate result but requires the partnership to have sufficient other items available for curative allocations.

(iii) Remedial Allocation Method (Treas. Reg. § 1.704-3(d)): Creates notional "remedial" allocations of income and deduction to the contributing partner and the non-contributing partners, respectively, to eliminate the ceiling rule distortion. This method produces the most accurate result but is mechanically complex.

We recommend the traditional method with curative allocations for the AcquisitionCo LLC Agreement, as it provides a reasonable balance between accuracy and administrative complexity. This recommendation is subject to Sylvia Hartwell's further analysis based on the specific tax attributes of the contributed MFW shares.

C. Potential Disguised Sale Risk — Section 707

If Holliday receives distributions from AcquisitionCo within two years of the contribution of MFW shares, such distributions could be recharacterized as part of a "disguised sale" under Section 707(a)(2)(B) of the Code and Treasury Regulation § 1.707-3. Under the disguised sale rules, if a partner contributes property to a partnership and receives a distribution from the partnership within a two-year period, the contribution and the distribution are presumed to constitute a sale of the property by the partner to the partnership (to the extent of the distribution), rather than a tax-deferred contribution followed by a separate distribution.

If the disguised sale rules were to apply, Holliday could be treated as having sold a portion of his MFW shares to AcquisitionCo for cash, which would result in recognition of gain by Holliday on the deemed sale. This outcome would undermine the intended Section 721 tax-deferred treatment of the rollover.

To mitigate the disguised sale risk, we recommend the following:

(a) Two-Year Distribution Moratorium. AcquisitionCo should impose a moratorium on non-tax distributions to Holliday for a period of two (2) years following the closing date. During this moratorium period, Holliday would receive only tax distributions — i.e., distributions sufficient to cover his estimated federal and state income tax liabilities attributable to allocations of taxable income from AcquisitionCo. Tax distributions are generally excluded from the disguised sale analysis under the "reasonable tax distribution" exception in Treasury Regulation § 1.707-4(a)(2).

(b) Alternative Structuring. If the two-year distribution moratorium is unacceptable to Holliday (see Section XV.A.7 below), alternative structuring should be considered to fit within the safe harbors of Treasury Regulation § 1.707-4, including structuring any distributions during the two-year period as guaranteed payments for services (if Holliday continues as CEO) or as distributions that are reasonably anticipated to be matched by future contributions.

The disguised sale risk is a significant tax issue that requires careful structuring and should be addressed in the definitive documentation. Sylvia Hartwell's tax analysis memorandum will provide a comprehensive evaluation of the disguised sale risk and recommended mitigation strategies.

D. Withholding and Reporting

AcquisitionCo will be required to file an annual partnership tax return (Form 1065) with the Internal Revenue Service and issue a Schedule K-1 (Form 1065) to Holliday reflecting his allocable share of AcquisitionCo's items of income, gain, loss, deduction, and credit for each taxable year.

State income tax withholding obligations must be evaluated based on Holliday's state of residence and the states in which AcquisitionCo and MFW conduct business operations:

(a) Virginia. Holliday is a resident of Virginia and will be subject to Virginia income tax on his allocable share of AcquisitionCo's income. AcquisitionCo may be required to withhold Virginia income tax on Holliday's distributive share of income under Virginia's composite filing or withholding requirements for nonresident partners, although this may not apply to Holliday as a Virginia resident.

(b) Texas. MFW has operations in Texas. Texas does not impose a state income tax on individuals, so no withholding obligation arises with respect to Texas-source income allocated to Holliday.

(c) Idaho. MFW has operations in Idaho. Idaho imposes a state income tax on individuals and may require AcquisitionCo to withhold Idaho income tax on Holliday's distributive share of Idaho-source income under Idaho's nonresident partner withholding requirements.

A comprehensive analysis of state tax withholding and filing obligations should be prepared by Sylvia Hartwell's tax team in coordination with the AcquisitionCo formation and compliance workstream.

X. PUT/CALL RIGHTS

A. Put Right (Holliday)

Holliday will have a put right (the "Put Right") entitling him to require Solara Fund III, LP (or, at Solara's election, AcquisitionCo) to purchase all or any portion of Holliday's Class B Common Units at fair market value. The Put Right is intended to provide Holliday with a liquidity mechanism in the event that a sale or other liquidity event has not occurred within the anticipated investment horizon.

The Put Right will be exercisable beginning on the fifth (5th) anniversary of the closing date of the Acquisition (i.e., on or after approximately April 30, 2031, assuming an April 30, 2026 closing) and will remain exercisable thereafter until the earlier of (x) the consummation of a drag-along sale or qualifying liquidity event and (y) the termination of the LLC Agreement and dissolution of AcquisitionCo.

Alternative Proposal (Anticipated Holliday Negotiating Position): Holliday may seek a Put Right exercisable upon the earlier of (a) the termination of Holliday's employment with MFW without cause or for good reason (as defined in his employment agreement), and (b) the fifth anniversary of the closing date. The earlier exercise trigger would provide Holliday with liquidity protection i

PRIVILEGED AND CONFIDENTIAL — ATTORNEY WORK PRODUCT — DRAFT FOR DISCUSSION PURPOSES ONLY
DRAFT — ROLLOVER AGREEMENT — OUTLINE AND TERM SHEET
PROJECT TRIDENT
Matter Number: 1041-00004 Transaction Code Name: Project Trident Engagement Letter Reference: 1041-00004
Date: [Undated — for circulation with first draft SPA package]
Prepared by:
Calderwood & Harkness LLP 277 Park Avenue, 45th Floor New York, NY 10172
James Prentice, Responsible Partner Sylvia Hartwell, Tax Specialist Partner Andrew Fitzpatrick, Lead Associate
Prepared for:
Solara Digital Infrastructure LP 1200 Market Street, Suite 2400 Wilmington, DE 19801
Attention: Viktor Sorensen, Managing Partner
Claire Nakamura, Partner, Head of Software Investing
This memorandum is a confidential attorney-client privileged communication prepared in connection with Engagement Letter Reference 1041-00004 and is intended solely for the use of the addressees identified above. This document constitutes attorney work product and is protected from disclosure under applicable law. Distribution, reproduction, or use of this memorandum by any person other than the intended recipients without the prior written consent of Calderwood & Harkness LLP is strictly prohibited. This memorandum does not constitute a binding agreement and is prepared solely for discussion purposes.
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I. INTRODUCTION AND PURPOSE
This memorandum sets forth the proposed outline and key terms for the Rollover Agreement (the "Rollover Agreement") to be entered into by Garrett Holliday ("Holliday") and Solara Fleet Holdings LLC ("AcquisitionCo" or "Buyer") in connection with the acquisition (the "Acquisition") of 100% of the issued and outstanding shares of common stock and Series A Preferred Stock of Meridian FleetWorks, Inc. ("MFW" or the "Company") by AcquisitionCo.
Pursuant to the Letter of Intent dated February 18, 2026 (Reference: LOI-MFW-2026-0218) (the "LOI"), Holliday has agreed to roll over a portion of his equity consideration into AcquisitionCo in lieu of receiving all-cash consideration at closing. The LOI contemplates that Holliday will contribute approximately $25,000,000 of his equity consideration into AcquisitionCo in exchange for membership interests therein, thereby maintaining a continuing economic interest in the post-closing enterprise alongside Solara Fund III, LP ("Fund III"). The arrangement is intended to align the interests of Holliday, as the Company's co-founder and continuing Chief Executive Officer, with those of the private equity sponsor over the anticipated hold period.
The Rollover Agreement will be an ancillary agreement to the Stock Purchase Agreement (the "SPA") to be entered into among AcquisitionCo, MFW, and the stockholders of MFW. Execution and delivery of the Rollover Agreement by Holliday will be a condition to AcquisitionCo's obligation to consummate the closing of the SPA. Similarly, the rollover transaction will be consummated simultaneously with, and contingent upon, the closing of the Acquisition.
The terms of the Rollover Agreement will need to be consistent with, and in certain instances implemented through, the Amended and Restated Limited Liability Company Agreement of Solara Fleet Holdings LLC (the "LLC Agreement"), which will be separately drafted and negotiated. Where provisions of the Rollover Agreement address economic rights, governance matters, or transfer restrictions, those provisions must be mirrored in the LLC Agreement to ensure enforceability and consistency between the two documents. The drafting team should coordinate the preparation of these two agreements in parallel, with cross-references maintained throughout.
Holliday's counsel at Hawthorne Kinsey & Alcott LLP (Rachel Greenwald, lead partner; Timothy Cho, associate counsel) is expected to negotiate the Rollover Agreement on Holliday's behalf. We anticipate meaningful negotiation on several key provisions, as identified in the open issues section of this memorandum (Section XV below). Calderwood & Harkness LLP will represent AcquisitionCo and Solara in all negotiations related to the Rollover Agreement.
The purpose of this memorandum is to provide the Solara deal team with a comprehensive overview of the proposed terms, identify key structuring considerations (including the critical tax analysis under Sections 721, 704(c), and 707 of the Internal Revenue Code), flag anticipated negotiation points, and establish a framework for the preparation of the definitive Rollover Agreement. This memorandum is intended to serve as the basis for internal discussion and approval prior to the preparation of definitive documentation.
II. PARTIES
A. Garrett Holliday
Garrett Holliday is the co-founder, Chief Executive Officer, and a member of the board of directors of Meridian FleetWorks, Inc. Holliday has served as CEO of MFW since the Company's founding in 2015 and has been principally responsible for the Company's growth from an early-stage startup to its current position as a leading provider of fleet management and logistics SaaS solutions. His principal residence is located in McLean, Virginia.
As of the date of this memorandum, Holliday's current equity holdings in MFW are as follows:
The foregoing holdings are calculated based on a fully diluted share count of 10,000,000 shares of MFW equity, which accounts for all outstanding common stock, Series A Preferred Stock, and the conversion or exercise (as applicable) of all outstanding options, warrants, and other convertible securities of MFW. Holliday's aggregate 32.0% equity stake makes him the single largest individual stockholder of MFW.
Under the terms of the SPA, the aggregate purchase price for 100% of MFW's fully diluted equity is $350,000,000, resulting in a per-share price of $35.00 ($350,000,000 ÷ 10,000,000 fully diluted shares). Accordingly, Holliday's total pre-rollover consideration equals 3,200,000 shares multiplied by $35.00 per share, or $112,000,000 in the aggregate. This amount is subject to the standard adjustments under the SPA, including the net working capital adjustment (against a target of $5,800,000), cash and debt adjustments at closing, and the allocation of MFW transaction expenses (estimated at approximately $12,000,000).
Holliday is expected to continue serving as the Chief Executive Officer of MFW following the closing of the Acquisition, subject to the terms of a post-closing employment agreement to be separately negotiated between Holliday and MFW (as a wholly-owned subsidiary of AcquisitionCo). The terms of Holliday's post-closing employment, including base salary, bonus targets, equity incentive arrangements, and severance protections, will be addressed in a separate employment agreement and are not the subject of this Rollover Agreement, although certain provisions of the Rollover Agreement (including put/call trigger events and governance rights) will be conditioned upon and interact with Holliday's employment status.
Holliday's current employment agreement with MFW (effective January 1, 2023) provides for a base salary of $425,000 per annum, an annual bonus target of 75% of base salary ($318,750), and a 24-month change-of-control severance provision. The existing employment agreement will be superseded by the post-closing employment arrangements, and the interaction between the change-of-control severance provision and the Acquisition closing must be addressed in the SPA and the funds flow.
B. Solara Fleet Holdings LLC (AcquisitionCo)
Solara Fleet Holdings LLC is a Delaware limited liability company to be newly formed as a wholly-owned subsidiary of Solara Fund III, LP (EIN: 84-6239017) prior to the closing of the Acquisition. As of the date of this memorandum, AcquisitionCo has not yet been formed. Formation will be effectuated by the filing of a Certificate of Formation with the Delaware Secretary of State, and an Employer Identification Number will be obtained from the Internal Revenue Service promptly upon formation. The registered office of AcquisitionCo will be established in the State of Delaware, and a registered agent will be designated in accordance with the Delaware Limited Liability Company Act (6 Del. C. § 18-101 et seq.).
Solara Fund III, LP is a Delaware limited partnership with approximately $1.85 billion in committed capital. Fund III is managed by its general partner, Solara Digital Infrastructure GP LLC, a Delaware limited liability company (the "General Partner"). The General Partner exercises investment authority over Fund III's committed capital and will be responsible for all investment decisions with respect to the Acquisition, including the negotiation and approval of the terms of the Rollover Agreement. For purposes of this memorandum, references to "Solara" include, as the context may require, Fund III, the General Partner, and their respective affiliates and related entities.
AcquisitionCo will be the direct purchaser of all issued and outstanding shares of common stock and Series A Preferred Stock of MFW under the SPA. Upon the consummation of the Acquisition, AcquisitionCo will hold 100% of the equity of MFW and will serve as the direct holding entity through which Fund III and Holliday (as the rollover investor) will hold their respective economic interests in the post-closing enterprise.
The capitalization of AcquisitionCo at closing will consist of the following:
The senior secured credit facility will be provided by a syndicate led by Ironclad National Bank, N.A., as administrative agent, and Ridgeline Commercial Lending Corp., as co-lender. The $125,000,000 Term Loan A will be drawn at closing to fund a portion of the aggregate purchase price. The terms of the credit facility are being negotiated separately and will be documented in a definitive credit agreement. The remaining $25,000,000 in the sources and uses table above reflects either additional equity from Fund III or mezzanine/subordinated debt, the specific allocation of which is to be finalized by the Solara deal team in coordination with the financing workstream.
III. ROLLOVER EQUITY — VALUATION AND MECHANICS
A. Rollover Amount
Holliday will contribute a portion of his equity consideration equal to approximately $25,000,000 in value (the "Rollover Amount") to AcquisitionCo in exchange for Class B Common Units. This Rollover Amount represents approximately 7.14% of the aggregate $350,000,000 deal value ($25,000,000 ÷ $350,000,000 ≈ 7.14%) and approximately 22.32% of Holliday's total pre-rollover consideration of $112,000,000 ($25,000,000 ÷ $112,000,000 ≈ 22.32%).
The $25,000,000 Rollover Amount will be expressed as a fixed dollar amount in the Rollover Agreement, subject to confirmation at or prior to closing. The parties intend that the Rollover Amount will not be subject to adjustment under the SPA's customary purchase price adjustment mechanisms (net working capital, cash, debt, and transaction expense adjustments), as those mechanisms affect the aggregate purchase price and per-share consideration payable to all stockholders of MFW generally, rather than the specific commitment of Holliday to contribute a fixed dollar amount of value to AcquisitionCo. The mechanics for determining the number of MFW shares (or dollar equivalent) to be contributed at closing are addressed in Section III.C below.
Holliday's net cash proceeds at closing, before giving effect to his pro rata share of the escrow holdback and MFW transaction expenses, will be approximately $87,000,000, calculated as follows:
The foregoing estimates are preliminary and subject to change based on the final determination of the per-share consideration, net working capital adjustments, and actual transaction expenses. The precise calculation of Holliday's net cash proceeds will be set forth in the funds flow memorandum to be prepared in connection with the closing.
B. Contribution Mechanics
At closing, rather than receiving the full cash consideration for his shares of MFW otherwise payable under the SPA, Holliday will contribute shares of MFW common stock and/or Series A Preferred Stock (or, alternatively, the right to receive a portion of his closing cash consideration) to AcquisitionCo in exchange for Class B Common Units.
The contribution will be effectuated simultaneously with, and contingent upon, the closing of the SPA. The precise sequence of the closing steps will be documented in the closing mechanics section of the SPA and the funds flow memorandum, but it is anticipated that the contribution will occur as an integrated step in the closing process, such that Holliday's contribution to AcquisitionCo and AcquisitionCo's acquisition of 100% of the MFW equity occur as part of a single, integrated transaction.
The specific shares to be contributed (common stock, Series A Preferred Stock, or a combination thereof) and the mechanics of the contribution (direct contribution of MFW shares versus a deemed cash contribution) will be determined based on tax optimization considerations. As discussed more fully in Section IX below, the preferred approach from a tax perspective is a direct contribution of MFW shares to AcquisitionCo under Section 721 of the Internal Revenue Code, in order to achieve tax-deferred treatment. If the rollover is structured as a deemed cash contribution — i.e., Holliday receives cash consideration under the SPA and simultaneously contributes that cash to AcquisitionCo — the step transaction doctrine risk must be carefully evaluated. Calderwood & Harkness's tax team, led by Sylvia Hartwell, will prepare a detailed analysis of the structuring alternatives and provide a recommendation prior to the finalization of the definitive documentation.
In connection with the contribution, Holliday will represent and warrant that the contributed shares are free and clear of all liens, pledges, security interests, charges, claims, encumbrances, and restrictions of any kind, other than restrictions under the MFW Stockholders' Agreement dated as of July 15, 2017 (as amended), which restrictions will terminate in their entirety at or prior to the closing of the Acquisition. The specific MFW shares to be contributed will be identified on Schedule 1 to the Rollover Agreement, including share certificate numbers (or book-entry references), classes, and quantities.
In exchange for the contribution, AcquisitionCo will issue to Holliday such number of Class B Common Units of AcquisitionCo as corresponds to the Rollover Amount, as determined in accordance with Section IV below.
C. Pre-Closing Adjustments
As noted above, the Rollover Amount is fixed at $25,000,000 and will not itself be subject to the net working capital adjustment, cash/debt adjustment, or transaction expense adjustment mechanisms set forth in the SPA. Those adjustment mechanisms affect the aggregate purchase price payable by AcquisitionCo to all MFW stockholders and, consequently, the per-share consideration, but do not alter Holliday's commitment to contribute $25,000,000 of value to AcquisitionCo.
However, the number of MFW shares (or the dollar equivalent) to be contributed by Holliday will be determined by reference to the per-share merger consideration as finally calculated under the SPA at closing. Specifically:
(a) If the per-share consideration is equal to the base $35.00 per share, Holliday will contribute 714,286 shares of MFW stock (calculated as $25,000,000 ÷ $35.00 per share, rounded to the nearest whole share), or such combination of common stock and Series A Preferred Stock as may be agreed.
(b) If the per-share consideration is adjusted from the base $35.00 per share (whether upward or downward) as a result of the SPA's purchase price adjustment mechanisms, the number of shares to be contributed will adjust proportionally so that the aggregate dollar value of the contributed shares remains as close as practicable to $25,000,000.
(c) In no event will the Rollover Amount exceed $25,000,000 or fall below $25,000,000, except to the extent of immaterial rounding adjustments necessitated by the application of a whole-share calculation to the adjusted per-share consideration.
This adjustment mechanism ensures that Holliday's rollover commitment is denominated in fixed dollar terms, with the share count serving as the variable, rather than the reverse. The parties will confirm the precise number of shares to be contributed and the per-share consideration at or prior to closing, and such confirmation will be reflected in a closing certificate to be delivered at closing.
IV. MEMBERSHIP INTEREST IN ACQUISITIONCO
A. Class of Membership Interest
In exchange for the contribution of the Rollover Amount, Holliday will receive Class B Common Units of Solara Fleet Holdings LLC. The LLC Agreement of AcquisitionCo will provide for two classes of common membership interests:
(i) Class A Common Units, to be held by Solara Fund III, LP, representing Fund III's equity contribution of $175,000,000 to AcquisitionCo; and
(ii) Class B Common Units, to be held by Holliday, representing the $25,000,000 Rollover Amount contributed by Holliday.
The relative rights, preferences, and privileges of Class A Common Units and Class B Common Units will be set forth in detail in the LLC Agreement. Unless otherwise specified in the LLC Agreement, both classes of units will carry the economic and governance rights described in this memorandum.
The Class B Common Units to be issued to Holliday will represent 12.5% of the total equity capitalization of AcquisitionCo at closing, calculated as the Rollover Amount ($25,000,000) divided by the total equity capitalization ($175,000,000 equity contribution from Fund III plus $25,000,000 rollover contribution from Holliday, totaling $200,000,000 of equity). It should be noted that the $125,000,000 in debt financing from Ironclad National Bank, N.A. and Ridgeline Commercial Lending Corp. constitutes leverage at the AcquisitionCo level and does not constitute equity for purposes of computing Holliday's percentage ownership interest.
Note to drafting team: There is an ambiguity in the LOI regarding the characterization of Holliday's percentage interest. The LOI references Holliday's rollover as representing "approximately 7.14% of deal value," which is calculated as $25,000,000 ÷ $350,000,000 (total enterprise value). However, Holliday's economic interest in the equity vehicle — AcquisitionCo — is properly 12.5% ($25,000,000 ÷ $200,000,000 equity capitalization). This distinction is material because it affects Holliday's share of distributions, his dilution protections, and the economic substance of the rollover. Clarification should be obtained from the Solara deal team (Viktor Sorensen / Claire Nakamura) as to which percentage figure governs, and the Rollover Agreement and LLC Agreement should be drafted to eliminate any ambiguity. We recommend that the definitive documents expressly state Holliday's percentage interest as 12.5% of the equity capitalization and define "Percentage Interest" accordingly.
B. Economic Rights
The Class B Common Units will participate pari passu with the Class A Common Units in all distributions made by AcquisitionCo, subject to the distribution waterfall to be set forth in the LLC Agreement. The distribution waterfall is expected to include the following tiers:
(i) Return of Capital. First, distributions to all members (Class A and Class B holders) pro rata in proportion to their respective capital contributions, until each member has received aggregate distributions equal to its total capital contributions.
(ii) Preferred Return (if applicable). Second, distributions to Class A holders (Solara Fund III, LP) until such holders have received a preferred return on their contributed capital. Solara's standard fund terms provide for an 8% per annum compounding preferred return to Fund investors. The applicability of a preferred return to Class A holders in the context of the AcquisitionCo structure, and the rate and compounding mechanics thereof, will be a key negotiation point with Holliday. See Section XV.A.5 (Open Issues) below.
(iii) Pro Rata Distributions. Third, following the satisfaction of the return of capital and any preferred return, all remaining distributions to be made pro rata to all members based on their respective percentage interests (12.5% to Holliday; 87.5% to Fund III).
To the extent the parties agree on a management promote or carried interest feature for Holliday's participation above the preferred return threshold, such feature will be documented in the LLC Agreement. A management promote would typically provide Holliday with a disproportionate share of distributions above a specified return threshold (e.g., 20% of distributions above a 2.0x return on invested capital to Fund III), which would serve as an additional incentive mechanism aligned with post-closing value creation. The specific terms of any promote arrangement, including hurdle rates, catch-up mechanics, and clawback provisions, are to be negotiated.
Tax distributions will be made to all members (including Holliday) in amounts sufficient to cover their estimated tax liabilities attributable to allocations of taxable income from AcquisitionCo. Tax distributions will be calculated based on the highest marginal combined federal and state income tax rate applicable to an individual resident in the highest-tax jurisdiction in which any member resides, applied to each member's allocable share of AcquisitionCo's taxable income for the applicable period. Tax distributions will be treated as advances against, and will reduce, subsequent distributions under the waterfall described above.
C. Capital Account
Holliday's initial capital account in AcquisitionCo will be credited with the fair market value of the contributed consideration, which is $25,000,000. Capital accounts will be maintained in accordance with the rules set forth in Treasury Regulation § 1.704-1(b)(2)(iv), including the requirements for proper maintenance of capital accounts in connection with contributions of property, distributions, and allocations of income, gain, loss, and deduction.
The LLC Agreement will include detailed capital account maintenance provisions, including provisions addressing the revaluation of capital accounts upon the occurrence of specified events (e.g., the admission of a new member, the distribution of property, or a liquidation of AcquisitionCo), in accordance with the "book-up" and "book-down" rules of Treasury Regulation § 1.704-1(b)(2)(iv)(f). Proper capital account maintenance is essential to support the allocations of income, gain, loss, and deduction under the LLC Agreement and to ensure that such allocations will be respected by the Internal Revenue Service under the substantial economic effect safe harbor of Treasury Regulation § 1.704-1(b)(2).
V. GOVERNANCE RIGHTS
A. Board / Manager Designation Rights
AcquisitionCo will be a manager-managed limited liability company under the Delaware Limited Liability Company Act, 6 Del. C. § 18-101 et seq. The management and affairs of AcquisitionCo will be vested in a board of managers (the "Board") or such other managing body as may be established under the LLC Agreement.
Solara Fund III, LP (acting through Solara Digital Infrastructure GP LLC, its general partner) will have the right to designate a majority of the managers of AcquisitionCo. Solara's control over the Board is consistent with standard private equity sponsor governance practices and is essential to the exercise of Fund III's investment authority and fiduciary obligations to its limited partners.
With respect to Holliday's governance rights, the drafting team proposes the following:
Proposed Approach (Solara's Preference): Holliday will receive board observer rights (non-voting) on the Board of AcquisitionCo. As a board observer, Holliday will be entitled to receive notice of all Board meetings, attend all Board meetings (whether in person or by teleconference), receive all materials distributed to members of the Board, and participate in Board discussions, but will not be entitled to vote on any matter before the Board. The board observer rights will be subject to the following conditions:
(a) Holliday must hold at least 50% of his initial Class B Common Units (i.e., units with a value of at least $12,500,000 at the time of issuance);
(b) Holliday must remain employed as the Chief Executive Officer of MFW; and
(c) The Board may exclude Holliday from portions of any Board meeting, and withhold any materials, to the extent reasonably necessary to preserve attorney-client privilege or to address matters in which Holliday has a personal conflict of interest.
Alternative Approach (Anticipated Holliday Negotiating Position): Holliday will have the right to designate one (1) manager to serve on a five-member Board, with Solara designating the remaining four (4) managers. The Holliday-designated manager would be a full voting member of the Board, entitled to all rights and subject to all duties of a manager under the LLC Agreement and applicable law.
Under either approach, Holliday's observer rights or manager designation rights will terminate automatically upon the occurrence of any of the following events:
(a) Holliday's cessation of employment with MFW for any reason, whether voluntary or involuntary, with or without cause;
(b) Holliday's transfer (other than a permitted transfer under Section VI below) of more than 50% of his initial Class B Common Units; or
(c) A qualifying liquidity event, including a sale of 100% of the equity of AcquisitionCo or MFW, a merger, an initial public offering, or a recapitalization that results in a change of control.
The Solara deal team should consider its preference on this point in advance of negotiations. Preserving plenary sponsor control over the Board is strongly recommended as a general principle, and the board observer approach is consistent with Solara's practice in prior fund investments. However, given Holliday's significant rollover commitment ($25,000,000) and his continuing role as CEO of the portfolio company, some accommodation of governance participation may be necessary to reach agreement.
B. Consent Rights
In addition to any governance rights described above, Holliday will have consent rights (or, at a minimum, advance notice rights) over certain "Major Decisions" affecting AcquisitionCo and MFW. The concept of Major Decision consent rights is standard in rollover transactions involving significant management equity participation and serves to protect the rollover investor against actions by the sponsor that could disproportionately impair the value of the management equity.
The proposed list of Major Decisions requiring Holliday's consent is as follows:
(a) Dilutive Issuances. The issuance of additional equity interests of AcquisitionCo (including options, warrants, or convertible securities) that would dilute the Class B Common Units below a specified threshold. The threshold is to be negotiated; Calderwood & Harkness suggests 5.0% of total equity capitalization as the floor below which dilution would trigger the consent right. Any issuances above the threshold but below Holliday's initial percentage interest would be subject to pre-emptive rights or anti-dilution protections, rather than a veto.
(b) Material Indebtedness. The incurrence by AcquisitionCo or MFW of material indebtedness in excess of a specified threshold. The threshold amount is to be negotiated and should be calibrated to the existing senior secured credit facility ($125,000,000 Term Loan A). We suggest a threshold of $10,000,000 in incremental indebtedness above the amounts outstanding under the existing credit facility at closing.
(c) Sale, Merger, or Liquidation. Any sale, merger, consolidation, recapitalization, or voluntary liquidation of AcquisitionCo or MFW, or any disposition of all or substantially all of the assets of AcquisitionCo or MFW. This consent right is subject to the drag-along provisions described in Section VII.B below — in the event Solara exercises its drag-along right, Holliday's consent will not be required, provided the drag-along conditions are satisfied.
(d) Adverse LLC Agreement Amendments. Any amendment, modification, or waiver of any provision of the LLC Agreement that would materially and adversely affect the rights, preferences, or privileges of the Class B Common Units on a disproportionate basis relative to the Class A Common Units.
(e) Related-Party Transactions. The entry into any transaction between AcquisitionCo or MFW, on the one hand, and Solara or any of its affiliates (including other Solara portfolio companies, Solara management company entities, and Solara personnel), on the other hand, that is outside the ordinary course of business. This provision is intended to address potential conflicts of interest inherent in the sponsor-portfolio company relationship, including management fees, monitoring fees, transaction fees, and intercompany service arrangements.
Solara will retain plenary control over all other matters affecting AcquisitionCo and MFW, consistent with customary private equity sponsor governance norms. The consent rights described above are intended to be narrowly tailored to protect against actions that could disproportionately impair the economic interests of the Class B holders, rather than to provide Holliday with a general governance veto.
C. Information Rights
Holliday will be entitled to receive the following information with respect to AcquisitionCo and MFW, subject to customary confidentiality obligations:
(a) Quarterly unaudited financial statements of AcquisitionCo and MFW, to be delivered within 45 days following the end of each fiscal quarter;
(b) Annual audited financial statements of AcquisitionCo and MFW, to be delivered within 90 days following the end of each fiscal year;
(c) Annual operating budgets of AcquisitionCo and MFW, to be delivered at least 30 days prior to the beginning of each fiscal year;
(d) Such other financial and operational information as Holliday may reasonably request from time to time, subject to AcquisitionCo's reasonable determination that the provision of such information would not impose an undue burden or compromise proprietary business information; and
(e) Tax information, including Schedule K-1 (Form 1065) and any other tax reporting documents necessary for Holliday to prepare his personal income tax returns, to be provided within 90 days following the end of each fiscal year of AcquisitionCo.
All information provided to Holliday pursuant to these information rights will be subject to the confidentiality obligations set forth in the Rollover Agreement and the LLC Agreement, as well as any confidentiality obligations to which Holliday is subject under his employment arrangements with MFW.
VI. TRANSFER RESTRICTIONS
A. General Lock-Up
Holliday may not transfer, sell, assign, pledge, hypothecate, encumber, or otherwise dispose of (collectively, "Transfer") any of his Class B Common Units, or any interest therein, without the prior written consent of Solara Fund III, LP (acting through its general partner, Solara Digital Infrastructure GP LLC), which consent may be withheld in Solara's sole and absolute discretion, subject to the limited exceptions set forth in Section VI.B below.
The general prohibition on Transfers will be in effect for a minimum lock-up period of three (3) years from the date of the closing of the Acquisition (the "Lock-Up Period"). The three-year Lock-Up Period is coterminous with the three-year term of Holliday's non-competition covenant under the Restrictive Covenant Agreement (see Section VIII below), reflecting the alignment between Holliday's continued commitment to the enterprise and the restriction on his ability to monetize his equity investment.
Following the expiration of the Lock-Up Period, Transfers will be permitted only with the prior written consent of Solara Fund III, LP (which consent may be withheld in Solara's reasonable discretion) and will be subject to the right of first refusal described in Section VI.C below. No Transfer may be made at any time to a competitor of MFW, an individual or entity that is subject to sanctions or debarment under applicable law, or any person or entity that Solara reasonably determines to be an unsuitable transferee.
B. Permitted Transfers
Notwithstanding the general lock-up described above, the following Transfers will be permitted without Solara's prior written consent at any time (including during the Lock-Up Period):
(a) Transfers by Holliday to his spouse, children, grandchildren, siblings, parents, or other members of his immediate family (collectively, "Family Members");
(b) Transfers by Holliday to a trust established primarily for the benefit of Holliday or one or more of his Family Members, provided that Holliday serves as the trustee of such trust or retains control over the voting and disposition of the transferred Class B Common Units;
(c) Transfers by Holliday to a limited liability company, partnership, corporation, or other entity in which Holliday and/or one or more of his Family Members are the sole equity holders and over which Holliday retains control;
(d) Transfers by Holliday in connection with bona fide estate planning transactions, including transfers to a family limited partnership, grantor retained annuity trust (GRAT), or similar estate planning vehicle; and
(e) Transfers by operation of law, including transfers by will, by intestate succession, or pursuant to a court order in connection with divorce proceedings (subject to any applicable domestic relations order).
As a condition to any permitted Transfer, the proposed transferee must execute and deliver to AcquisitionCo a joinder agreement (substantially in the form attached to the Rollover Agreement as Exhibit C) pursuant to which the transferee agrees to be bound by all of the terms and conditions of the Rollover Agreement and the LLC Agreement, including the transfer restrictions, tag-along and drag-along provisions, and confidentiality obligations, as if the transferee were an original party thereto. No permitted Transfer will relieve Holliday of his obligations under the Rollover Agreement or the Restrictive Covenant Agreement.
C. Right of First Refusal (ROFR)
If, following the expiration of the Lock-Up Period, Holliday proposes to Transfer any of his Class B Common Units (other than in a permitted Transfer described in Section VI.B above) and Solara has consented to such Transfer, Solara Fund III, LP (or, at Solara's election, AcquisitionCo) will have a right of first refusal ("ROFR") to purchase the Class B Common Units proposed to be Transferred, on the following terms:
(a) Transfer Notice. Holliday will deliver a written notice (the "Transfer Notice") to Solara Fund III, LP and AcquisitionCo identifying the proposed transferee, the number of Class B Common Units proposed to be Transferred, the proposed purchase price and other material terms of the proposed Transfer, and a copy of any written offer, term sheet, letter of intent, or agreement (whether binding or non-binding) relating to the proposed Transfer.
(b) Exercise Period. Solara Fund III, LP (or AcquisitionCo) will have a period of thirty (30) calendar days following receipt of the Transfer Notice (the "ROFR Exercise Period") within which to deliver written notice to Holliday of its election to purchase all (but not less than all) of the Class B Common Units identified in the Transfer Notice, at the price and on the terms set forth in the Transfer Notice.
(c) Consummation of ROFR Purchase. If Solara Fund III, LP (or AcquisitionCo) elects to exercise the ROFR, the closing of the ROFR purchase will occur within thirty (30) calendar days following the date of exercise, or such longer period as may be required to obtain any regulatory approvals.
(d) Lapse of ROFR. If Solara Fund III, LP (or AcquisitionCo) does not exercise the ROFR within the ROFR Exercise Period, Holliday may complete the proposed Transfer to the third-party transferee identified in the Transfer Notice, on terms and conditions no less favorable to Holliday than those set forth in the Transfer Notice, and at a price not less than the price set forth in the Transfer Notice, provided that the Transfer is consummated within ninety (90) calendar days following the expiration of the ROFR Exercise Period. If the Transfer is not consummated within such 90-day period, the Class B Common Units will again become subject to the ROFR, and Holliday must deliver a new Transfer Notice before proceeding with any subsequent proposed Transfer.
D. Compliance with Securities Laws
All Transfers of Class B Common Units must comply with applicable federal and state securities laws, including the Securities Act of 1933, as amended (the "Securities Act"), and any applicable state "blue sky" laws. The Class B Common Units will not be registered under the Securities Act, and accordingly, any Transfer will be permitted only if (i) the Transfer is made pursuant to an effective registration statement under the Securities Act, (ii) the Transfer is exempt from registration under the Securities Act (including, without limitation, pursuant to Rule 144, Section 4(a)(1), Section 4(a)(1½), or Section 4(a)(7) of the Securities Act), or (iii) AcquisitionCo has received an opinion of counsel reasonably acceptable to AcquisitionCo to the effect that no registration is required.
Each certificate (or book entry) representing Class B Common Units will bear a customary restrictive legend substantially in the following form:
"THE MEMBERSHIP INTERESTS REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR UNDER ANY STATE SECURITIES LAWS AND MAY NOT BE OFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, OR OTHERWISE DISPOSED OF EXCEPT IN COMPLIANCE WITH SUCH LAWS AND THE TERMS OF THE LIMITED LIABILITY COMPANY AGREEMENT OF SOLARA FLEET HOLDINGS LLC."
VII. TAG-ALONG AND DRAG-ALONG RIGHTS
A. Tag-Along (Co-Sale) Rights
If Solara Fund III, LP proposes to sell or transfer fifty percent (50%) or more of its Class A Common Units to a bona fide third party (other than to an affiliate of Solara Fund III, LP), Holliday will have the right (but not the obligation) to participate in such sale on a pro rata basis, on the same terms and conditions as those applicable to Solara Fund III, LP's sale (the "Tag-Along Right").
The Tag-Along Right will operate as follows:
(a) Tag-Along Notice. Solara Fund III, LP will deliver to Holliday a written notice (the "Tag-Along Notice") at least twenty (20) business days prior to the anticipated closing of the proposed sale, identifying the proposed purchaser, the number of Class A Common Units to be sold, the proposed per-unit purchase price, and the other material terms and conditions of the proposed sale.
(b) Exercise. Holliday will have a period of fifteen (15) business days following receipt of the Tag-Along Notice within which to deliver written notice to Solara Fund III, LP of his election to exercise the Tag-Along Right with respect to all or any portion of his Class B Common Units, on a pro rata basis. Holliday's pro rata share will be calculated based on the ratio of Holliday's total Class B Common Units to the total outstanding common units (Class A and Class B) of AcquisitionCo.
(c) Terms of Participation. If Holliday exercises his Tag-Along Right, the proposed purchaser will be required to purchase Holliday's Class B Common Units (to the extent of his pro rata share) on the same terms and conditions (including per-unit price, representations, warranties, indemnities, and escrow arrangements) applicable to Solara Fund III, LP's sale. If the proposed purchaser is unwilling to purchase Holliday's pro rata share of units, Solara Fund III, LP will reduce the number of Class A Common Units to be sold so as to accommodate Holliday's tag-along participation.
(d) Failure to Exercise. If Holliday does not exercise his Tag-Along Right within the 15-business-day exercise period, Solara Fund III, LP may proceed with the proposed sale without Holliday's participation, subject to the other provisions of the LLC Agreement.
The Tag-Along Right will not apply to transfers by Solara Fund III, LP to its affiliates (including transfers to successor funds, parallel funds, co-investment vehicles, or any entity under common control with Solara Digital Infrastructure GP LLC), provided that the transferee assumes all obligations of Solara Fund III, LP under the LLC Agreement and the Rollover Agreement.
B. Drag-Along Rights
If Solara Fund III, LP proposes to sell or transfer 100% of the equity of AcquisitionCo (or to cause a sale, merger, consolidation, or other liquidity event involving AcquisitionCo or MFW) to a bona fide, unaffiliated third party (a "Drag-Along Sale"), Solara Fund III, LP will have the right to require Holliday to sell all of his Class B Common Units in connection with such Drag-Along Sale, on the same terms and conditions applicable to Solara Fund III, LP (the "Drag-Along Right").
The Drag-Along Right will apply to any transaction that results in, or is structured to result in, a change of control of AcquisitionCo or MFW, including without limitation:
(a) A sale of 100% of the outstanding membership interests of AcquisitionCo;
(b) A merger or consolidation of AcquisitionCo or MFW with or into another entity, in which the members of AcquisitionCo immediately prior to the transaction do not retain a majority of the equity interests in the surviving entity;
(c) A sale of all or substantially all of the assets of AcquisitionCo or MFW; or
(d) Any other transaction or series of related transactions that results in a change of control.
Upon exercise of the Drag-Along Right by Solara Fund III, LP:
(a) Holliday will be required to sell all of his Class B Common Units and execute and deliver all documents, agreements, instruments, and certificates reasonably required to consummate the Drag-Along Sale, including stock powers, letters of transmittal, voting agreements, and support agreements.
(b) Holliday will receive per-unit consideration for his Class B Common Units that is no less favorable than the per-unit consideration received by Solara Fund III, LP for its Class A Common Units, calculated on an as-converted and fully diluted basis after giving effect to the distribution waterfall in the LLC Agreement.
(c) Holliday will be required to participate in any indemnification arrangements, escrow holdbacks, or purchase price adjustments in the Drag-Along Sale on a pro rata basis, consistent with his percentage interest in AcquisitionCo.
(d) Holliday will not be required to provide representations, warranties, or indemnification in connection with the Drag-Along Sale beyond those representations and warranties customary for a selling equityholder. Specifically, Holliday's representations and warranties will be limited to: (i) his title to the Class B Common Units, free and clear of liens; (ii) his authority to consummate the sale; (iii) the absence of conflicts with agreements to which he is a party; and (iv) the absence of broker's or finder's fees owed by Holliday. Under no circumstances will Holliday be required to provide business-level representations, warranties, or indemnification regarding MFW, its operations, assets, liabilities, financial condition, or prospects.
The Drag-Along Right is a fundamental protection for the private equity sponsor and is non-negotiable in its core structure. However, the protections afforded to Holliday as a drag-along participant — particularly the requirement of no-less-favorable per-unit consideration and the limitation on representations and indemnities — are intended to ensure that Holliday is treated equitably in any liquidity event.
VIII. RESTRICTIVE COVENANTS (CROSS-REFERENCE)
The Rollover Agreement will incorporate by reference, or contain express cross-references to, the Restrictive Covenant Agreement to be entered into separately by Holliday in connection with the closing of the Acquisition (the "Restrictive Covenant Agreement"). The Restrictive Covenant Agreement will be negotiated as a separate ancillary agreement and will be the subject of a companion outline and term sheet to be prepared by the Calderwood & Harkness team.
For purposes of the Rollover Agreement, the key covenants under the Restrictive Covenant Agreement are summarized as follows:
(a) Non-Competition. For a period of three (3) years following the closing of the Acquisition (or, if later, three (3) years following the termination of Holliday's employment with MFW), Holliday will be restricted from directly or indirectly engaging in, owning, managing, operating, financing, or participating in any business that competes with MFW in the fleet management and logistics SaaS market. The geographic scope and specific carve-outs will be defined in the Restrictive Covenant Agreement.
(b) Non-Solicitation. For a period of three (3) years following the closing of the Acquisition (or, if later, three (3) years following the termination of Holliday's employment with MFW), Holliday will be restricted from directly or indirectly soliciting, recruiting, or hiring any employee of MFW, or soliciting, diverting, or taking away any customer, client, or business relationship of MFW.
(c) Confidentiality. Holliday will be subject to perpetual confidentiality obligations with respect to all proprietary information, trade secrets, and confidential business information of MFW and AcquisitionCo. The confidentiality obligations will survive the termination of Holliday's employment and the termination or expiration of the Rollover Agreement.
The Rollover Agreement will provide that a material breach by Holliday of any provision of the Restrictive Covenant Agreement constitutes a "Forfeiture Event" with respect to Holliday's Class B Common Units. Upon the occurrence of a Forfeiture Event, Solara Fund III, LP (or AcquisitionCo, at Solara's election) will have the right, but not the obligation, to repurchase all of Holliday's then-outstanding Class B Common Units at a price equal to the lower of (x) original cost (i.e., the Rollover Amount of $25,000,000, adjusted pro rata for any prior distributions or partial dispositions) and (y) the fair market value of the Class B Common Units as of the date of the Forfeiture Event, as determined in accordance with the valuation methodology set forth in Section X.C of this memorandum.
The forfeiture provision serves as a powerful enforcement mechanism for the restrictive covenants and is in addition to (not in lieu of) any other remedies available to AcquisitionCo, MFW, or Solara at law or in equity, including claims for damages and injunctive relief. Enforcement of the Restrictive Covenant Agreement, including the forfeiture provision, will be subject to the exclusive jurisdiction of the Court of Chancery of the State of Delaware (or the alternative courts specified in Section XIV.B below). The parties will agree in the Rollover Agreement and the Restrictive Covenant Agreement that specific performance and injunctive relief are available remedies in connection with any breach or threatened breach of the restrictive covenants.
IX. TAX TREATMENT
A. Intended Tax-Deferred Contribution — Section 721
The contribution of MFW equity (or the right to cash consideration) by Holliday to AcquisitionCo in exchange for Class B Common Units is intended to be treated as a tax-deferred contribution under Section 721 of the Internal Revenue Code of 1986, as amended (the "Code"). Section 721(a) provides, as a general rule, that no gain or loss shall be recognized to a partnership or to any of its partners in the case of a contribution of property to the partnership in exchange for an interest in the partnership.
Because AcquisitionCo will be a multi-member limited liability company (with Solara Fund III, LP and Holliday as its members), AcquisitionCo will be classified as a partnership for federal income tax purposes under the default classification rules of Treasury Regulation § 301.7701-3 (unless an affirmative election is made to be classified as a corporation, which is not anticipated). The contribution of MFW shares by Holliday to AcquisitionCo in exchange for Class B Common Units should therefore qualify for tax-deferred treatment under Section 721, provided the contribution satisfies the requirements of that section.
Under Section 721, neither Holliday nor AcquisitionCo will recognize gain or loss upon the contribution of MFW shares to AcquisitionCo in exchange for Class B Common Units. This treatment has the following consequences:
(a) Holliday's Basis in Class B Common Units. Under Section 722 of the Code, Holliday's tax basis in his Class B Common Units will equal the adjusted basis of the contributed property — i.e., Holliday's adjusted tax basis in the MFW shares contributed to AcquisitionCo. This "substituted basis" carries over from the contributed property to the partnership interest received in exchange therefor. If Holliday's adjusted tax basis in the contributed MFW shares is less than $25,000,000 (their fair market value), Holliday will have a built-in gain in his Class B Common Units equal to the difference.
(b) AcquisitionCo's Basis in Contributed Shares. Under Section 723 of the Code, AcquisitionCo's tax basis in the MFW shares contributed by Holliday will equal Holliday's adjusted tax basis in such shares immediately prior to the contribution. This "transferred basis" preserves the built-in gain (or loss) in the contributed property at the entity level.
(c) Holding Period. Under Section 1223(1), Holliday's holding period in his Class B Common Units will include his holding period in the contributed MFW shares. Under Section 1223(2), AcquisitionCo's holding period in the contributed MFW shares will include Holliday's holding period.
Critical Structuring Consideration: If the rollover is structured as a deemed cash contribution — i.e., Holliday receives cash consideration under the SPA and simultaneously contributes that cash to AcquisitionCo — there is a material risk that the Internal Revenue Service could invoke the step transaction doctrine to collapse the cash receipt and cash contribution into a single integrated transaction. If the step transaction doctrine applies, the IRS could recharacterize the transaction as a taxable sale of MFW shares by Holliday (to the extent of the cash received) combined with a separate contribution of property to AcquisitionCo, potentially resulting in Holliday recognizing gain on the entire cash consideration received (not just the portion in excess of the Rollover Amount).
To mitigate this risk, we strongly recommend structuring the rollover as a direct contribution of MFW shares to AcquisitionCo, rather than as a deemed cash contribution. In a direct share contribution, Holliday contributes his MFW shares to AcquisitionCo in a single step, and AcquisitionCo then acquires the remaining MFW shares from the other stockholders for cash under the SPA. This structure more clearly supports Section 721 treatment and minimizes step transaction risk.
Sylvia Hartwell is preparing a detailed tax analysis memorandum addressing the optimal structure for the rollover, the Section 721 analysis, and the interaction of the rollover with the potential Section 338(h)(10) election. If a Section 338(h)(10) election is made in connection with the Acquisition, the interaction with Holliday's rollover must be carefully evaluated. A Section 338(h)(10) election treats the stock purchase as a deemed asset sale by MFW for federal income tax purposes, which results in MFW recognizing gain on the deemed sale of its assets. The impact of a 338(h)(10) election on the tax-deferred nature of Holliday's Section 721 contribution is complex and requires analysis of whether the contribution and the deemed asset sale can coexist within the same transaction framework. This analysis will be set forth in a separate memorandum and should be finalized prior to the execution of definitive documentation.
B. Section 704(c) Allocations
To the extent there is a difference between the fair market value of the MFW shares contributed by Holliday ($25,000,000) and Holliday's adjusted tax basis in such shares, Section 704(c) of the Code will require that the "built-in gain" or "built-in loss" attributable to the contributed property be allocated to Holliday (as the contributing partner) upon a subsequent disposition of the contributed property by AcquisitionCo.
The purpose of Section 704(c) is to prevent the shifting of pre-contribution gains and losses among partners. If Holliday contributes MFW shares with a fair market value of $25,000,000 and an adjusted tax basis of, for example, $5,000,000, there would be $20,000,000 of built-in gain in the contributed property. Under Section 704(c), if AcquisitionCo subsequently sells or disposes of the contributed shares (or other property with a basis determined by reference to the contributed shares), the $20,000,000 of built-in gain must be allocated to Holliday.
The LLC Agreement should specify the Section 704(c) allocation method to be used in making the required allocations. The three methods available under the Treasury Regulations are:
(i) Traditional Method (Treas. Reg. § 1.704-3(b)): Allocates built-in gain to the contributing partner but does not create offsetting "remedial" allocations to the other partners. The traditional method can result in a "ceiling rule" limitation, which may cause non-contributing partners (i.e., Solara Fund III) to bear a disproportionate share of the tax burden.
(ii) Traditional Method with Curative Allocations (Treas. Reg. § 1.704-3(c)): Allocates built-in gain to the contributing partner and permits "curative" allocations of other items of income, gain, loss, or deduction to offset the ceiling rule limitation. This method produces a more economically accurate result but requires the partnership to have sufficient other items available for curative allocations.
(iii) Remedial Allocation Method (Treas. Reg. § 1.704-3(d)): Creates notional "remedial" allocations of income and deduction to the contributing partner and the non-contributing partners, respectively, to eliminate the ceiling rule distortion. This method produces the most accurate result but is mechanically complex.
We recommend the traditional method with curative allocations for the AcquisitionCo LLC Agreement, as it provides a reasonable balance between accuracy and administrative complexity. This recommendation is subject to Sylvia Hartwell's further analysis based on the specific tax attributes of the contributed MFW shares.
C. Potential Disguised Sale Risk — Section 707
If Holliday receives distributions from AcquisitionCo within two years of the contribution of MFW shares, such distributions could be recharacterized as part of a "disguised sale" under Section 707(a)(2)(B) of the Code and Treasury Regulation § 1.707-3. Under the disguised sale rules, if a partner contributes property to a partnership and receives a distribution from the partnership within a two-year period, the contribution and the distribution are presumed to constitute a sale of the property by the partner to the partnership (to the extent of the distribution), rather than a tax-deferred contribution followed by a separate distribution.
If the disguised sale rules were to apply, Holliday could be treated as having sold a portion of his MFW shares to AcquisitionCo for cash, which would result in recognition of gain by Holliday on the deemed sale. This outcome would undermine the intended Section 721 tax-deferred treatment of the rollover.
To mitigate the disguised sale risk, we recommend the following:
(a) Two-Year Distribution Moratorium. AcquisitionCo should impose a moratorium on non-tax distributions to Holliday for a period of two (2) years following the closing date. During this moratorium period, Holliday would receive only tax distributions — i.e., distributions sufficient to cover his estimated federal and state income tax liabilities attributable to allocations of taxable income from AcquisitionCo. Tax distributions are generally excluded from the disguised sale analysis under the "reasonable tax distribution" exception in Treasury Regulation § 1.707-4(a)(2).
(b) Alternative Structuring. If the two-year distribution moratorium is unacceptable to Holliday (see Section XV.A.7 below), alternative structuring should be considered to fit within the safe harbors of Treasury Regulation § 1.707-4, including structuring any distributions during the two-year period as guaranteed payments for services (if Holliday continues as CEO) or as distributions that are reasonably anticipated to be matched by future contributions.
The disguised sale risk is a significant tax issue that requires careful structuring and should be addressed in the definitive documentation. Sylvia Hartwell's tax analysis memorandum will provide a comprehensive evaluation of the disguised sale risk and recommended mitigation strategies.
D. Withholding and Reporting
AcquisitionCo will be required to file an annual partnership tax return (Form 1065) with the Internal Revenue Service and issue a Schedule K-1 (Form 1065) to Holliday reflecting his allocable share of AcquisitionCo's items of income, gain, loss, deduction, and credit for each taxable year.
State income tax withholding obligations must be evaluated based on Holliday's state of residence and the states in which AcquisitionCo and MFW conduct business operations:
(a) Virginia. Holliday is a resident of Virginia and will be subject to Virginia income tax on his allocable share of AcquisitionCo's income. AcquisitionCo may be required to withhold Virginia income tax on Holliday's distributive share of income under Virginia's composite filing or withholding requirements for nonresident partners, although this may not apply to Holliday as a Virginia resident.
(b) Texas. MFW has operations in Texas. Texas does not impose a state income tax on individuals, so no withholding obligation arises with respect to Texas-source income allocated to Holliday.
(c) Idaho. MFW has operations in Idaho. Idaho imposes a state income tax on individuals and may require AcquisitionCo to withhold Idaho income tax on Holliday's distributive share of Idaho-source income under Idaho's nonresident partner withholding requirements.
A comprehensive analysis of state tax withholding and filing obligations should be prepared by Sylvia Hartwell's tax team in coordination with the AcquisitionCo formation and compliance workstream.
X. PUT/CALL RIGHTS
A. Put Right (Holliday)
Holliday will have a put right (the "Put Right") entitling him to require Solara Fund III, LP (or, at Solara's election, AcquisitionCo) to purchase all or any portion of Holliday's Class B Common Units at fair market value. The Put Right is intended to provide Holliday with a liquidity mechanism in the event that a sale or other liquidity event has not occurred within the anticipated investment horizon.
The Put Right will be exercisable beginning on the fifth (5th) anniversary of the closing date of the Acquisition (i.e., on or after approximately April 30, 2031, assuming an April 30, 2026 closing) and will remain exercisable thereafter until the earlier of (x) the consummation of a drag-along sale or qualifying liquidity event and (y) the termination of the LLC Agreement and dissolution of AcquisitionCo.
Alternative Proposal (Anticipated Holliday Negotiating Position): Holliday may seek a Put Right exercisable upon the earlier of (a) the termination of Holliday's employment with MFW without cause or for good reason (as defined in his employment agreement), and (b) the fifth anniversary of the closing date. The earlier exercise trigger would provide Holliday with liquidity protection i