Claire and Viktor,
I hope this message finds you well. Please find below our first weekly legal diligence status report for Project Trident — the proposed acquisition of Meridian FleetWorks, Inc. ("MFW") by Solara Fleet Holdings LLC (C&H Matter No. 1041-00004). This report covers the period from LOI execution on February 18, 2026 through today's date, February 25, 2026.
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**1. OVERALL STATUS SUMMARY**
Confirmatory legal due diligence is underway and progressing on schedule. As a reminder, the buyer's diligence completion deadline under the LOI is March 15, 2026, and we are tracking to meet that deadline across all workstreams. The target date for execution of the definitive Stock Purchase Agreement ("SPA") remains March 31, 2026. A first draft of the SPA (buyer's form) is currently in preparation, and we expect to circulate it to the Solara deal team for internal review before transmitting to target's counsel.
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**2. VDR ACCESS AND DOCUMENT FLOW**
We have confirmed access to the Project Trident virtual data room hosted on the Thackeray Solutions platform. The VDR was initially populated by MFW's counsel at Hawthorne Kinsey & Alcott LLP ("HKA") — specifically Rachel Greenwald and Timothy Cho. Initial corporate and organizational documents have been received and are under review by our team, with Naomi Petersen leading the document-level review.
Our comprehensive due diligence request list was transmitted to HKA on February 19, 2026. A number of responsive documents have been uploaded to date, but several categories remain outstanding. We are following up directly with HKA to ensure timely population of the remaining items and will escalate if necessary.
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**3. DILIGENCE WORKSTREAMS — STATUS BY CATEGORY**
**3.1 Corporate and Organizational**
We have received and are reviewing MFW's certificate of incorporation, bylaws, board resolutions, and stockholder records. MFW is a Delaware corporation (Delaware File Number 5582037). We are confirming good standing in Delaware, Virginia (headquarters), Texas (Austin office), and Idaho (Boise office).
Capitalization records indicate the following:
- **Common Stock:** 10,000,000 shares authorized; 7,850,000 shares issued and outstanding - **Series A Preferred Stock:** 2,000,000 shares authorized; 1,500,000 shares issued and outstanding - **Stock Options:** 650,000 options outstanding under the 2016 Stock Incentive Plan
This yields a fully diluted share count of 10,000,000 shares, which is consistent with the per-share purchase price of $35.00 and the $350,000,000 enterprise value. We are reviewing the stockholders' agreement for any transfer restrictions or consent requirements applicable to the contemplated stock purchase.
**3.2 Material Contracts**
We are reviewing the key contracts uploaded to the VDR. The following are the principal agreements identified to date:
- **TerraLink Logistics, Inc. Strategic Partnership Agreement** (dated March 15, 2022): This is MFW's largest customer relationship, representing approximately $3,800,000 in annual recurring revenue (roughly 6.1% of total ARR). The agreement has a five-year term running through approximately March 2027. **Key issue identified:** The agreement contains a change-of-control consent provision requiring written consent from TerraLink for any change of control of MFW. This consent has not yet been obtained. We recommend initiating the consent process as early as practicable, and we anticipate making TerraLink's consent a condition to closing in the SPA.
- **Brindoval Data Solutions LLC Cloud Hosting Agreement** (dated September 1, 2023): Approximately $2,100,000 in annual spend; three-year initial term expiring August 31, 2026, with automatic one-year renewal periods. We are reviewing the assignment and change-of-control provisions.
- **Sentinel Commerce Bank, N.A. Credit Facility:** Existing revolving line of credit with approximately $4,200,000 outstanding. This facility will need to be repaid in full at closing. We will coordinate the payoff letter and lien release documentation in advance of the closing date.
- **Garrett Holliday Employment Agreement** (effective January 1, 2023): Base salary of $425,000; annual bonus target of 75% of base ($318,750); 24-month severance upon termination without cause or for good reason following a change of control.
- **Diana Vasquez-Park Employment Agreement** (effective January 1, 2023): Base salary of $385,000; annual bonus target of 60% of base ($231,000); 18-month severance upon change-of-control termination.
- **Standard-Form Master Subscription Agreement:** Approximately 4,200 customer accounts. We are reviewing the form agreement for anti-assignment or change-of-control triggers that could affect customer relationships post-closing.
- **Office Leases (McLean, Austin, Boise):** Under review. A separate real estate diligence memorandum will follow.
**3.3 intellectual Property**
**Key issue identified:** Our preliminary IP diligence indicates that three former contractors, engaged during the 2015–2016 period in the early development of the MFW platform, may not have executed IP assignment agreements covering their contributions to the core software. This creates potential gaps in the chain of title to MFW's principal intellectual property asset. We are working to confirm the scope of these contractors' contributions and will assess options for resolution, including: (a) obtaining retroactive assignment agreements from the former contractors, (b) negotiating a specific IP representation and indemnification provision in the SPA, and/or (c) addressing the issue through the representations and warranties insurance policy. We will provide further detail in our dedicated IP diligence memorandum, which we expect to complete during the week of March 2.
Additionally, we are reviewing MFW's trademark portfolio, domain name registrations, trade secret protections, and open-source software license compliance.
**3.4 Employment and Benefits**
We are reviewing headcount data for MFW's approximately 310 employees across the McLean, Austin, and Boise offices.
With respect to the 2016 Stock Incentive Plan: 1,300,000 shares are authorized under the plan, with 650,000 options currently outstanding at a weighted-average exercise price of $8.50 per share. Of these, 480,000 are vested and 170,000 are unvested. At the proposed per-share purchase price of $35.00, aggregate net proceeds to option holders would be approximately $17,225,000 (($35.00 – $8.50) × 650,000 shares). The SPA will need to address option cancellation and cash-out mechanics, including treatment of unvested options.
We are also reviewing the compensation and equity holdings of Marcus Trahan (CFO), who holds 150,000 shares of common stock and 80,000 vested options.
**Key issue identified:** MFW currently utilizes approximately 25 independent contractors in its product development function. We are assessing worker classification risk under applicable federal and state law, including the laws of Virginia, Texas, and Idaho. If any of these individuals are determined to be misclassified as independent contractors rather than employees, MFW could face exposure for unpaid employment taxes, benefits, and penalties. We will provide a more detailed risk assessment in our employment and benefits diligence memorandum.
**3.5 Tax and Sales Tax**
Sylvia Hartwell is leading the tax diligence workstream on our side and is coordinating with the Whitmore Sandoval Group LLC (engagement lead Daniel Ostroff) on their buy-side quality of earnings analysis and related tax findings.
**Key issue identified (via Whitmore Sandoval preliminary findings):** MFW may have sales tax collection and remittance obligations (nexus) in approximately 6–8 states where it has not been collecting or remitting SaaS sales tax. The estimated exposure range is $800,000 to $1,400,000. We have asked Whitmore Sandoval to provide detail on the specific states and periods at issue. We anticipate addressing this item through a combination of: (a) a specific tax indemnity or escrow/holdback provision in the SPA, (b) a seller representation on tax compliance, and (c) potential coverage under the R&W insurance policy. Sylvia is coordinating directly with Daniel Ostroff on this workstream.
Separately, Sylvia is analyzing the feasibility and economic impact of a potential Section 338(h)(10) election under the Internal Revenue Code, which could provide stepped-up tax basis benefits to the buyer. A preliminary analysis memorandum on this topic is forthcoming.
**3.6 Regulatory and Compliance**
An HSR Act filing will be required given that the $350,000,000 transaction value exceeds the applicable Hart-Scott-Rodino thresholds. The estimated filing fee is $350,000, which is the buyer's obligation under the LOI. We do not anticipate CFIUS concerns, as all parties are U.S.-domiciled. MFW does not hold any regulated licenses, so no state regulatory approvals are expected.
On the data privacy front, MFW processes fleet GPS and driver-behavior data. We are reviewing compliance with applicable state privacy and biometric data laws, including the Illinois Biometric Information Privacy Act (BIPA) and the California Consumer Privacy Act (CCPA). This analysis is ongoing, and we will report further in next week's update.
We are also reviewing MFW's compliance with Electronic Logging Device (ELD) requirements and FMCSA regulations as they relate to MFW's product offerings.
**3.7 Real Estate**
MFW leases three office locations and does not own any real property:
| Location
We are reviewing the change-of-control and assignment provisions in each lease and will assess whether landlord consents are required in connection with the transaction.
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**4. FINANCING AND INSURANCE COORDINATION**
- **Debt Financing:** The debt commitment letter from Ironclad National Bank, N.A. (Reference No. CL-INB-2026-0214, dated February 14, 2026) has been reviewed, and a summary memorandum was circulated to the deal team. The commitment provides for a $175,000,000 senior secured credit facility, consisting of a $125,000,000 Term Loan A (with Ridgeline Commercial Lending Corp. participating $50,000,000) and a $50,000,000 Revolving Credit Facility (expected to be undrawn at closing). Cascade & Whitfield LLP (Jonathan Mayer) is acting as lenders' counsel.
- **R&W Insurance:** The representations and warranties insurance process has been initiated with Trident Peak Insurance Brokers Inc. (account executive Megan Forsythe). Atlas Meridian Underwriters Ltd. is the prospective carrier. The proposed policy limit is $35,000,000 (10% of enterprise value), with an estimated premium of approximately $1,050,000 plus applicable taxes and fees. A draft submission to the underwriter is in preparation and will incorporate diligence findings as they develop. The known issues identified to date — IP assignment gaps, sales tax exposure, and the TerraLink change-of-control consent — will be disclosed in the application.
- **Equity Commitment Letter:** The equity commitment letter from Solara Fund III, LP to Solara Fleet Holdings LLC ($175,000,000 equity commitment) is being drafted by our team. We will circulate a draft for your review shortly.
- **Exclusivity Deposit:** As a reminder, the exclusivity deposit of $2,500,000 is due to Northgate Escrow Services LLC by today's date, February 25, 2026 (being the fifth business day after LOI execution). Wire instructions were transmitted to you on February 19, 2026. **Please confirm at your earliest convenience that the wire has been initiated or completed.**
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**5. SPA PREPARATION**
We are making good progress on the transaction documentation. Specifically:
- An annotated SPA outline and internal term sheet are in preparation and will be circulated to the Solara deal team for comment before we convert to a full first draft. - The first draft SPA (buyer's form) is targeted for completion and client-side review by approximately the second week of March, to allow sufficient time for transmission to HKA and negotiation within the March 31 target execution timeline. - We are drafting an escrow agreement term sheet (Northgate Escrow Services LLC as escrow agent; $17,500,000 general indemnity escrow; 18-month survival period for general representations, with escrow release approximately October 31, 2027, assuming an April 30, 2026 closing). - We are outlining a stockholder support agreement to cover the principal equity holders: Pinnacle Bluff Ventures (~34.0% of fully diluted equity), Garrett Holliday (~32.0%), and Diana Vasquez-Park (~18.0%) — collectively approximately 84.0% of the fully diluted equity. - We are outlining a rollover agreement for Garrett Holliday ($25,000,000 rollover, representing approximately 7.14% of deal value, into a membership interest in Solara Fleet Holdings LLC). - We are outlining restrictive covenant agreements for Holliday (three-year non-compete) and Vasquez-Park (two-year non-compete).
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**6. UPCOMING MILESTONES AND ACTION ITEMS**
| Target Date
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**7. NEXT STEPS**
We are happy to schedule a call at your convenience to discuss any of the foregoing items in greater detail — in particular the TerraLink consent issue, the IP assignment gaps, or the sales tax exposure findings, each of which we consider to be priority items warranting early attention. If there are specific areas you would like the team to prioritize or accelerate, please do not hesitate to let us know.
The next weekly status update will be sent on or about Wednesday, March 4, 2026.
Thank you, and please reach out with any questions in the interim.
Best regards,
**Andrew Fitzpatrick** Associate Calderwood & Harkness LLP 277 Park Avenue, 45th Floor New York, NY 10172 Direct: (212) 554-7183 afitzpatrick@calderwoodharkness.com
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