GUARANTEE AGREEMENT
Dated as of May 15, 2024
by
IRONHAVEN HOLDINGS INC.
a Delaware corporation
as Guarantor
in favor of
CRESCENT HARBOR BANK, NATIONAL ASSOCIATION
as Administrative Agent
for the benefit of the Secured Parties
Reference: Senior Secured Term Loan B Credit Agreement dated as of May 15, 2024
CUSIP: 46283LAA5
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This GUARANTEE AGREEMENT (this "Guarantee Agreement"), dated as of May 15, 2024, is executed and delivered by IRONHAVEN HOLDINGS INC., a corporation duly organized and existing under the laws of the State of Delaware (the "Guarantor" or "Parent Guarantor"), in favor of CRESCENT HARBOR BANK, NATIONAL ASSOCIATION, a national banking association organized under the laws of the United States of America, in its capacity as administrative agent (in such capacity, together with its successors and assigns in such capacity, the "Administrative Agent") for the benefit of the Secured Parties (as defined below) under and in connection with that certain Senior Secured Term Loan B Credit Agreement, dated as of May 15, 2024 (as the same may be amended, restated, amended and restated, supplemented, or otherwise modified from time to time, the "Credit Agreement"), among Ironhaven Data Centers LLC, a Delaware limited liability company (the "Borrower"), Ironhaven Frankfurt GmbH, a German Gesellschaft mit beschränkter Haftung (the "Co-Borrower"), Ironhaven Holdings Inc. (the "Parent Guarantor"), the Lenders from time to time party thereto (the "Lenders"), Crescent Harbor Bank, N.A., as Administrative Agent, and Pinnacle Trust Company, N.A., as Collateral Agent (in such capacity, together with its successors and assigns in such capacity, the "Collateral Agent").
RECITALS
WHEREAS:
A. The Borrower (Ironhaven Data Centers LLC, a Delaware limited liability company with its principal office at 4500 Dominion Ridge Boulevard, Suite 300, Ashburn, Virginia 20147) and the Co-Borrower (Ironhaven Frankfurt GmbH, a German Gesellschaft mit beschränkter Haftung registered at Amtsgericht Frankfurt am Main, HRB 129457, with its registered office at Hanauer Landstraße 188, 60314 Frankfurt am Main, Germany) have entered into the Credit Agreement with the Lenders, the Administrative Agent, and the Collateral Agent, pursuant to which the Lenders have agreed, subject to the terms and conditions set forth therein, to extend credit to the Borrower and the Co-Borrower in the form of a senior secured term loan B facility in an aggregate principal amount of $950,000,000, consisting of (i) a USD Tranche in an aggregate principal amount of $675,000,000 and (ii) a EUR Sub-Tranche in an aggregate principal amount of €253,571,429, equivalent to approximately $275,000,000 at an exchange rate of 1.0846 USD per EUR as of the date hereof (collectively, the "Term Loan");
B. The Guarantor is a corporation duly organized, validly existing, and in good standing under the laws of the State of Delaware, with its principal office located at 4500 Dominion Ridge Boulevard, Suite 300, Ashburn, Virginia 20147, and bearing Employer Identification Number 84-3291044. The Guarantor is the direct parent of the Borrower and holds, directly, 100% of the issued and outstanding membership interests of the Borrower;
C. The Guarantor is, as of the date hereof, wholly owned, directly and indirectly, by Thornfield Infrastructure Fund III, LP, a Delaware limited partnership (the "Sponsor Fund"), through Thornfield Capital Partners, LP, a Delaware limited partnership (the "Sponsor"). The Sponsor serves as the general partner and investment manager of the Sponsor Fund, and the Sponsor Fund constitutes the ultimate beneficial owner of 100% of the equity interests of the Guarantor;
D. It is a condition precedent to the obligation of the Lenders to fund the Term Loan under the Credit Agreement, and to the extension of credit to the Borrower and the Co-Borrower contemplated thereby, that the Guarantor shall have executed and delivered this Guarantee Agreement in favor of the Administrative Agent for the benefit of the Secured Parties;
E. The Guarantor acknowledges that it will derive substantial direct and indirect benefit from the making of the Term Loan and the other extensions of credit to the Borrower and the Co-Borrower under the Credit Agreement and the other Loan Documents. The proceeds of the Term Loan will be used, among other purposes, to finance the acquisition, construction, and equipping of data center facilities operated by the Borrower and its subsidiaries, to refinance existing indebtedness, and for general corporate purposes, all of which will inure to the benefit of the Guarantor as the sole equity holder of the Borrower; and
F. This Guarantee Agreement is subject to the terms and provisions of that certain First Lien / Super-Senior Intercreditor Agreement (the "Intercreditor Agreement"), entered into among the Borrower, Crescent Harbor Bank, N.A., in its capacities as Term Loan Agent and Revolver Agent, and Pinnacle Trust Company, N.A., as Collateral Agent, which Intercreditor Agreement governs the relative priorities, rights, and remedies of the Secured Parties with respect to the collateral securing the Guaranteed Obligations.
NOW, THEREFORE, in consideration of the premises and the agreements herein contained, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and intending to be legally bound hereby, the Guarantor agrees as follows:
ARTICLE I — DEFINITIONS AND INTERPRETATION
Section 1.01 — Definitions
Capitalized terms used but not otherwise defined herein shall have the meanings assigned to such terms in the Credit Agreement. As used in this Guarantee Agreement, the following terms shall have the following meanings:
"Administrative Agent" means Crescent Harbor Bank, National Association, a national banking association headquartered at 1200 Harbor Point Drive, Charlotte, North Carolina 28202, in its capacity as administrative agent under the Credit Agreement, and its successors and assigns in such capacity.
"Borrower" means Ironhaven Data Centers LLC, a Delaware limited liability company with its principal office at 4500 Dominion Ridge Boulevard, Suite 300, Ashburn, Virginia 20147.
"Closing Date" means June 3, 2024.
"Co-Borrower" means Ironhaven Frankfurt GmbH, a German Gesellschaft mit beschränkter Haftung registered at Amtsgericht Frankfurt am Main, HRB 129457, with its registered office at Hanauer Landstraße 188, 60314 Frankfurt am Main, Germany.
"Collateral Agent" means Pinnacle Trust Company, N.A., a national trust company headquartered at 101 Constitution Avenue NW, Washington, D.C. 20001, in its capacity as collateral agent and security trustee under the Credit Agreement and the related security documents (including the US Security Agreement, the US Pledge Agreement, the Deed of Trust, and the German-law security documents), and its successors and assigns in such capacity.
"Credit Agreement" means the Senior Secured Term Loan B Credit Agreement, dated as of May 15, 2024, among the Borrower, the Co-Borrower, the Parent Guarantor, the Lenders from time to time party thereto, the Administrative Agent, and the Collateral Agent, as the same may be amended, restated, amended and restated, supplemented, refinanced, replaced, or otherwise modified from time to time in accordance with its terms.
"Guaranteed Obligations" means all Obligations (as defined in the Credit Agreement), including, without limitation, (a) all principal of the Term Loan (including both the USD Tranche and the EUR Sub-Tranche), (b) all interest thereon (including interest accruing after the commencement of any bankruptcy, insolvency, reorganization, or similar proceeding, whether or not such interest constitutes an allowed claim in such proceeding), (c) all fees (including the arrangement fee, the administrative agent fee, the collateral agent fee, and all other fees), (d) all expenses, (e) all indemnification obligations, and (f) all other amounts payable by the Borrower, the Co-Borrower, or any other Loan Party under the Credit Agreement and the other Loan Documents, in each case whether now existing or hereafter arising, whether direct or indirect, absolute or contingent, joint or several, matured or unmatured, liquidated or unliquidated, secured or unsecured.
"Guarantor" means Ironhaven Holdings Inc., a corporation organized under the laws of the State of Delaware.
"Intercreditor Agreement" means the First Lien / Super-Senior Intercreditor Agreement among the Borrower, Crescent Harbor Bank, N.A., in its capacities as Term Loan Agent and Revolver Agent, and Pinnacle Trust Company, N.A. as Collateral Agent, as the same may be amended, restated, or otherwise modified from time to time.
"Lenders" means the lenders from time to time party to the Credit Agreement, which as of the date hereof consist of: (i) Crescent Harbor Bank, N.A. (commitment of $200,000,000), (ii) Ridgeline National Bank (commitment of $175,000,000), (iii) Marlowe Asset Management Meridian Capital, LLC (commitment of $150,000,000), (iv) Atlas Peak Credit Partners, LP (commitment of $125,000,000), (v) NordBrücke AG (commitment of $150,000,000), (vi) Pacific Rim Institutional Lending Corp. (commitment of $75,000,000), and (vii) Osprey Insurance Capital, Ltd. (commitment of $75,000,000), and their respective successors and assigns.
"Loan Documents" has the meaning assigned to such term in the Credit Agreement, and includes, without limitation, the Credit Agreement, this Guarantee Agreement, the US Security Agreement, the US Pledge Agreement, the Deed of Trust, the German-law security documents (including the German Account Pledge Agreement, the German Share Pledge Agreement, and the Global Assignment Agreement), the Intercreditor Agreement, and all other agreements, instruments, certificates, and documents executed and delivered in connection therewith.
"Maturity Date" means June 3, 2031.
"Secured Parties" means, collectively, the Administrative Agent, the Collateral Agent, the Lenders, and each other Person to whom any of the Guaranteed Obligations are owed under or in connection with the Credit Agreement or any other Loan Document.
"Termination Date" means the date on which all Guaranteed Obligations have been indefeasibly paid in full in cash and all commitments under the Credit Agreement have been irrevocably terminated.
Section 1.02 — Rules of Interpretation
(a) References in this Guarantee Agreement to the Credit Agreement, any Loan Document, or any other agreement or instrument shall be deemed to include all amendments, restatements, amendments and restatements, supplements, renewals, extensions, refinancings, replacements, and other modifications thereof, in each case as permitted thereby and by the Credit Agreement.
(b) Unless the context otherwise requires, all references to "Sections," "Articles," "Exhibits," and "Schedules" are to sections, articles, exhibits, and schedules of this Guarantee Agreement.
(c) This Guarantee Agreement shall be interpreted in accordance with the interpretive conventions of the laws of the State of New York. Terms defined in the Uniform Commercial Code as in effect in the State of New York from time to time and used but not otherwise defined herein shall have the meanings ascribed to them therein, except to the extent that such terms are separately defined in the Credit Agreement or in this Guarantee Agreement.
(d) The definitions of terms herein shall apply equally to the singular and plural forms of the terms defined. Whenever the context may require, any pronoun shall include the corresponding masculine, feminine, and neuter forms. The words "include," "includes," and "including" shall be deemed to be followed by the phrase "without limitation." The word "will" shall be construed to have the same meaning and effect as the word "shall." Unless the context requires otherwise, (i) any definition of or reference to any agreement, instrument, or other document herein shall be construed as referring to such agreement, instrument, or other document as from time to time amended, supplemented, or otherwise modified (subject to any restrictions on such amendments, supplements, or modifications set forth herein), (ii) any reference herein to any Person shall be construed to include such Person's successors and assigns, (iii) the words "herein," "hereof," and "hereunder," and words of similar import, shall be construed to refer to this Guarantee Agreement in its entirety and not to any particular provision hereof, and (iv) all references herein to "$" or "Dollars" shall mean United States Dollars, and all references to "€" or "EUR" shall mean Euros.
(e) The headings and captions in this Guarantee Agreement are for convenience of reference only and shall not define, limit, or otherwise affect any of the terms or provisions hereof.
Section 1.03 — Credit Agreement Controls
In the event of any conflict or inconsistency between the provisions of this Guarantee Agreement and the provisions of the Credit Agreement, the provisions of the Credit Agreement shall govern and control. Nothing in this Guarantee Agreement shall be construed to limit or otherwise derogate from any right, power, or remedy of any Secured Party under the Credit Agreement or any other Loan Document.
ARTICLE II — THE GUARANTEE
Section 2.01 — Guarantee of the Obligations
The Guarantor hereby absolutely, unconditionally, and irrevocably guarantees to the Administrative Agent, for the ratable benefit of each of the Secured Parties, the full and punctual payment when due (whether at stated maturity, by required prepayment, by acceleration, by demand, or otherwise) and performance of all Guaranteed Obligations. This guarantee constitutes a guarantee of payment and not merely of collection and shall not be conditioned or contingent upon the pursuit of any remedies against the Borrower, the Co-Borrower, any other Loan Party, or any other Person, or against any collateral or security for any of the Guaranteed Obligations.
Without limiting the generality of the foregoing, the Guarantor's liability hereunder covers, without limitation:
(a) all principal of the Term Loan in an aggregate amount of up to $950,000,000, consisting of (i) the USD Tranche in an aggregate principal amount of $675,000,000 and (ii) the EUR Sub-Tranche in an aggregate principal amount of €253,571,429 (approximately $275,000,000 at an exchange rate of 1.0846 USD per EUR), together with all accrued and unpaid interest thereon, computed at a rate per annum equal to (A) with respect to the USD Tranche, the Adjusted Term SOFR Rate plus 425 basis points (subject to a SOFR floor of 0.50%) and (B) with respect to the EUR Sub-Tranche, the Adjusted EURIBOR Rate plus 425 basis points (subject to a EURIBOR floor of 0.00%);
(b) the arrangement fee in the amount of $14,250,000 payable to Crescent Harbor Bank, N.A. on the Closing Date;
(c) the administrative agent fee of $175,000 per annum payable to the Administrative Agent;
(d) the collateral agent fee of $200,000 per annum payable to the Collateral Agent (which fee covers both domestic and German-law collateral administration);
(e) all expenses, indemnification obligations, and other amounts payable by the Borrower, the Co-Borrower, or any other Loan Party under the Credit Agreement and the other Loan Documents;
(f) all mandatory prepayment amounts, including without limitation amounts arising from (i) Excess Cash Flow sweeps (at the applicable percentage of 75%, 50%, or 25% based on the Net Leverage Ratio step-downs set forth in the Credit Agreement) and (ii) Change of Control mandatory prepayments at 101% of the outstanding principal amount thereof plus accrued and unpaid interest; and
(g) all interest, fees, costs, expenses, and other amounts that accrue or become due after the commencement of any voluntary or involuntary case, proceeding, or other action under any existing or future law of any jurisdiction relating to bankruptcy, insolvency, reorganization, arrangement, adjustment, winding-up, liquidation, dissolution, composition, or similar relief with respect to the Borrower, the Co-Borrower, the Guarantor, or any other Loan Party, or with respect to the respective debts or assets of any of them (each, a "Proceeding"), whether or not such interest, fees, costs, expenses, or other amounts constitute an allowed claim in such Proceeding.
Section 2.02 — Guarantee Absolute
The obligations of the Guarantor under this Article II are absolute, unconditional, and irrevocable, irrespective of the value, genuineness, validity, regularity, or enforceability of any of the Guaranteed Obligations or any other agreement or instrument referred to herein or therein, or any substitution, release, or exchange of any collateral securing any of the Guaranteed Obligations, and, to the fullest extent permitted by applicable law, irrespective of any other circumstance whatsoever that might otherwise constitute a legal or equitable discharge or defense of a surety or guarantor. Without limiting the generality of the foregoing, it is agreed that the occurrence of any one or more of the following shall not alter or impair the liability of the Guarantor hereunder, which shall remain absolute, unconditional, and irrevocable as described above:
(a) at any time or from time to time, without notice to the Guarantor, the time for any performance of, or compliance with, any of the Guaranteed Obligations shall be extended, or such performance or compliance shall be waived;
(b) any lack of validity or enforceability of the Credit Agreement, any other Loan Document, or any other agreement or instrument relating thereto;
(c) any change in the time, manner, or place of payment of, or in any other term of, all or any of the Guaranteed Obligations, or any other amendment, waiver, or modification (whether by course of conduct or otherwise) of, or any consent to departure from, the Credit Agreement or any other Loan Document, including, without limitation, any changes to the financial covenants contained therein (including the maximum Net Leverage Ratio of 6.00x and the minimum Interest Coverage Ratio of 2.00x);
(d) any exchange, release, non-perfection, impairment, or diminution of any collateral securing any of the Guaranteed Obligations, including without limitation the Virginia campus parcels identified as Tax Parcel Nos. 087-27-1234 and 087-27-1235, Loudoun County, Virginia, and the Frankfurt campus parcel recorded at the Grundbuch von Frankfurt am Main-Ost, Blatt 54321, Flur 12, Flurstück 789, or any failure to take or perfect any security interest in any such collateral;
(e) any change in the corporate structure, ownership, capitalization, or organizational form of the Borrower, the Co-Borrower, or any subsidiary of the Borrower, whether by merger, consolidation, conversion, dissolution, or otherwise;
(f) any insolvency, bankruptcy, reorganization, arrangement, adjustment, winding-up, liquidation, dissolution, composition, or similar proceeding affecting the Borrower, the Co-Borrower, the Guarantor, or any other Person;
(g) any release or discharge of any other guarantor of the Guaranteed Obligations (if any);
(h) any taking, exchange, substitution, subordination, or release of any collateral for all or any of the Guaranteed Obligations;
(i) any act or omission by the Administrative Agent, the Collateral Agent, or any Lender that directly or indirectly results in or aids the discharge of the Borrower, the Co-Borrower, or any other Person from any of the Guaranteed Obligations by operation of law or otherwise; and
(j) any other circumstance (including, without limitation, any statute of limitations) or any existence of or reliance on any representation by the Administrative Agent, the Collateral Agent, or any Lender that might otherwise constitute a defense available to, or a discharge of, the Borrower, the Co-Borrower, or the Guarantor in respect of the Guaranteed Obligations or this Guarantee Agreement.
The Guarantor hereby acknowledges and agrees that this Guarantee Agreement shall not be discharged except by complete performance and payment in full in cash of the Guaranteed Obligations.
Section 2.03 — Waivers by Guarantor
The Guarantor hereby unconditionally and irrevocably waives, to the fullest extent permitted by applicable law:
(a) any requirement that the Administrative Agent, the Collateral Agent, or any other Secured Party exhaust any right, take any action, or pursue any remedy against the Borrower, the Co-Borrower, any other guarantor (if any), or any other Person, or against any collateral or other security for any of the Guaranteed Obligations, before proceeding against the Guarantor under this Guarantee Agreement;
(b) any right to require the Administrative Agent, the Collateral Agent, or any Secured Party to proceed against the Borrower, the Co-Borrower, or any other Person before proceeding hereunder;
(c) presentment to, demand of payment from, and protest and notice of dishonor, non-payment, non-performance, or default to, the Borrower, the Co-Borrower, or any other Person with respect to any of the Guaranteed Obligations;
(d) notice of acceptance of this Guarantee Agreement or any other guaranty;
(e) filing of claims with a court in the event of the insolvency or bankruptcy of the Borrower, the Co-Borrower, or any other Person;
(f) any defense arising by reason of any disability or other defense of the Borrower, the Co-Borrower, or any other Person, or by reason of the cessation from any cause whatsoever (other than payment in full in cash) of the liability of the Borrower, the Co-Borrower, or any other Person;
(g) any defense arising from the statute of limitations in any action hereunder or under the Credit Agreement or any other Loan Document;
(h) any defense arising under any anti-deficiency statute or any other statute or rule of law that provides that the obligation of a surety or guarantor must not be larger in amount and in other respects more burdensome than that of the principal obligor;
(i) any and all suretyship defenses generally, including, without limitation, all defenses that the Guarantor might otherwise have by reason of the principles of suretyship law;
(j) any and all rights under Article 3 of the Uniform Commercial Code as in effect in the State of New York or any other applicable jurisdiction, and any other applicable law, relating to the obligations of sureties or guarantors;
(k) any right to require marshaling of assets of the Borrower, the Co-Borrower, or any other Person or any other guarantor;
(l) any defense based upon the election of remedies by the Administrative Agent, the Collateral Agent, or any Lender, including any defense based upon an election of remedies that has destroyed or otherwise impaired the subrogation rights of the Guarantor, the right of the Guarantor to proceed against the Borrower, the Co-Borrower, or any other guarantor for reimbursement, or the right of the Guarantor to proceed against any collateral securing any of the Guaranteed Obligations; and
(m) any duty on the part of the Administrative Agent, the Collateral Agent, or any Secured Party to disclose to the Guarantor any matter, fact, or thing relating to the business, operation, or condition of the Borrower, the Co-Borrower, or any of their respective subsidiaries or affiliates now known or hereafter known by the Administrative Agent, the Collateral Agent, or any Secured Party.
Section 2.04 — Reinstatement
The Guarantor agrees that this Guarantee Agreement shall continue to be effective, or shall be reinstated, as the case may be, if at any time any payment, or any part thereof, of any of the Guaranteed Obligations is rescinded, invalidated, declared to be fraudulent or preferential, set aside, or is otherwise required to be restored or returned by any Secured Party upon the insolvency, bankruptcy, dissolution, liquidation, reorganization, or arrangement of the Borrower, the Co-Borrower, or any other Person, or upon or as a result of the appointment of a custodian, receiver, trustee, or other officer with similar powers with respect to the Borrower, the Co-Borrower, or any other Person, or any property of any of them, or otherwise, all as though such payment or payments had not been made. If an event giving rise to the reinstatement of the Guarantor's obligations hereunder shall occur, the Guarantor's obligations hereunder with respect to such reinstated obligations shall be effective as if such obligations had never been reduced or discharged.
Section 2.05 — Subrogation
The Guarantor hereby agrees that, until the Termination Date, it shall not exercise and hereby waives any right of subrogation, reimbursement, indemnification, contribution, or other similar right against the Borrower, the Co-Borrower, or any other guarantor (if any) by reason of any payment or performance by the Guarantor under this Guarantee Agreement, whether such right arises under an express or implied contract or agreement, by operation of law, or otherwise. The Guarantor further agrees that any and all claims, rights, and liens that the Guarantor may now or at any time hereafter hold against the Borrower or any other Loan Party, or any of their respective assets, that arise by reason of the existence or performance of the Guarantor's obligations hereunder shall be subordinate and subject in right of payment to the prior indefeasible payment in full in cash of all Guaranteed Obligations and the termination of all commitments under the Credit Agreement. If any amount shall be paid to the Guarantor on account of such subrogation, reimbursement, or other rights at any time prior to the Termination Date, such amount shall be held in trust for the benefit of the Secured Parties and shall be forthwith paid to the Administrative Agent for application to the Guaranteed Obligations in accordance with the Credit Agreement.
Section 2.06 — Continuing Guarantee
This Guarantee Agreement is a continuing guarantee of payment and performance and shall remain in full force and effect until the Termination Date. This Guarantee Agreement shall not be affected by any intermediate payment or settlement of account or by any change in the amount of the Guaranteed Obligations from time to time outstanding. The obligations of the Guarantor hereunder shall not be subject to any reduction, limitation, impairment, or termination for any reason, including any claim of waiver, release, surrender, alteration, or compromise of any of the Guaranteed Obligations, and shall not be subject to any defense or set-off, counterclaim, recoupment, or termination whatsoever by reason of the invalidity, illegality, or unenforceability of any of the Guaranteed Obligations or otherwise.
Section 2.07 — Maximum Liability; Savings Clause
Notwithstanding any other provision of this Guarantee Agreement to the contrary, the liability of the Guarantor hereunder shall not exceed the maximum amount that would not render the Guarantor's obligations hereunder void, voidable, or unenforceable under any applicable law relating to fraudulent transfer, fraudulent conveyance, or similar laws, including, without limitation, Sections 544, 548, and 550 of Title 11 of the United States Code (the "Bankruptcy Code") and any applicable state fraudulent conveyance or fraudulent transfer statutes, including the Uniform Fraudulent Transfer Act, the Uniform Voidable Transactions Act, and comparable provisions of the laws of any state or other jurisdiction.
For purposes of determining the maximum liability of the Guarantor hereunder, the Guarantor's liability shall be limited to an amount equal to the greater of (i) the aggregate amount of all Guaranteed Obligations and (ii) the largest amount that would not cause the Guarantor's obligations hereunder to constitute a "fraudulent transfer" or "fraudulent conveyance" under Section 548 of the Bankruptcy Code or a fraudulent conveyance or fraudulent transfer under any applicable state law, in each case after giving effect to (A) all other liabilities of the Guarantor, contingent or otherwise, that are relevant under such laws, and (B) the value of any right of subrogation, contribution, reimbursement, or indemnification of the Guarantor pursuant to applicable law or any agreement to which the Guarantor is a party.
The parties hereto intend that this Guarantee Agreement not constitute a fraudulent transfer or conveyance for purposes of the Bankruptcy Code or any comparable provision of state law. To effectuate the foregoing intention, the Administrative Agent, the Lenders, the Collateral Agent, and the Guarantor hereby irrevocably agree that the Guaranteed Obligations guaranteed hereunder shall be limited to such maximum amount as will, after giving effect to such maximum amount and all other (contingent or otherwise) liabilities of the Guarantor that are relevant under such laws, and after giving effect to any rights of contribution, subrogation, reimbursement, or indemnification of the Guarantor pursuant to applicable law or any agreement, result in the obligations of the Guarantor under this Guarantee Agreement not constituting a fraudulent transfer or conveyance.
ARTICLE III — REPRESENTATIONS AND WARRANTIES
The Guarantor hereby represents and warrants to the Administrative Agent and each of the Secured Parties as of the date hereof and as of the Closing Date as follows:
Section 3.01 — Organization and Good Standing
The Guarantor is a corporation duly organized, validly existing, and in good standing under the laws of the State of Delaware. The Guarantor possesses all corporate power and authority necessary to own and operate its properties and assets and to carry on its business as currently conducted and as proposed to be conducted. The Guarantor is duly qualified and authorized to do business and is in good standing in each jurisdiction where the character of its properties or the nature of its activities makes such qualification necessary, except where the failure to be so qualified could not reasonably be expected to have a Material Adverse Effect. The Guarantor's Employer Identification Number is 84-3291044. The Guarantor's registered agent in the State of Delaware is Cascade Systems, located at 160 Greentree Drive, Suite 101, Dover, Delaware 19904. The Guarantor's principal office is located at 4500 Dominion Ridge Boulevard, Suite 300, Ashburn, Virginia 20147.
Section 3.02 — Authorization; Enforceability
The execution, delivery, and performance by the Guarantor of this Guarantee Agreement and the consummation of the transactions contemplated hereby have been duly authorized by all necessary corporate action on the part of the Guarantor, including the adoption of resolutions of the Board of Directors of Ironhaven Holdings Inc. specifically authorizing the execution and delivery of this Guarantee Agreement and the performance of the Guarantor's obligations hereunder (a certified copy of which resolutions is attached hereto as Exhibit B). No further corporate action, approval, authorization, or consent of the Guarantor, its Board of Directors, or its stockholders is required in connection with this Guarantee Agreement. This Guarantee Agreement has been duly executed and delivered by the Guarantor and constitutes the legal, valid, and binding obligation of the Guarantor, enforceable against the Guarantor in accordance with its terms, except as such enforceability may be limited by (a) applicable bankruptcy, insolvency, reorganization, moratorium, receivership, conservatorship, or other similar laws affecting the enforcement of creditors' rights generally and (b) general principles of equity (regardless of whether such enforcement is sought in a proceeding in equity or at law).
Section 3.03 — No Conflicts
The execution, delivery, and performance by the Guarantor of this Guarantee Agreement and the consummation of the transactions contemplated hereby do not and will not:
(a) violate or conflict with the certificate of incorporation, bylaws, or other organizational documents of the Guarantor, in each case as in effect on the date hereof;
(b) violate or conflict with any applicable law, rule, regulation, judgment, order, writ, decree, or injunction of any governmental authority applicable to the Guarantor or any of its properties or assets;
(c) result in a breach of, constitute a default under, or give rise to any right of termination, cancellation, or acceleration under, any material agreement, indenture, mortgage, deed of trust, lease, license, or other instrument or obligation to which the Guarantor is a party or by which the Guarantor or any of its properties or assets is bound; or
(d) result in the creation or imposition of any lien, charge, or encumbrance upon any property or asset of the Guarantor (other than liens created under the Loan Documents).
No consent, approval, order, or authorization of, or registration, declaration, or filing with, any governmental authority or other Person is required in connection with the execution, delivery, and performance by the Guarantor of this Guarantee Agreement or the consummation of the transactions contemplated hereby, other than (i) filings and recordings in connection with the perfection of the security interests granted under the Loan Documents, (ii) filings with the Securities and Exchange Commission as may be required, and (iii) such consents, approvals, authorizations, registrations, declarations, or filings as have already been obtained or made and are in full force and effect.
Section 3.04 — Ownership of Borrower
The Guarantor directly owns 100% of the issued and outstanding membership interests of the Borrower (Ironhaven Data Centers LLC). Such membership interests are free and clear of all liens, claims, encumbrances, and restrictions on transfer (other than (i) those arising under applicable securities laws and (ii) those created pursuant to the Loan Documents, including the Equity Interest Pledge Agreement). The Guarantor is itself wholly owned, directly and indirectly, by Thornfield Infrastructure Fund III, LP (a Delaware limited partnership with a vintage year of 2021 and committed capital of $4.8 billion), through its general partner, Thornfield Capital Partners, LP.
Section 3.05 — Solvency
After giving effect to (a) the transactions contemplated by the Credit Agreement, including the funding of the Term Loan in an aggregate principal amount of $950,000,000, (b) the refinancing of $130,000,000 in outstanding mezzanine notes held by Greystone Mezzanine Fund II, LP, (c) the equity contribution of $410,000,000 by Thornfield Infrastructure Fund III, LP (through Thornfield Capital Partners, LP), and (d) the payment of all fees, expenses, and other costs incurred in connection therewith:
(i) the fair value of the assets of the Guarantor (on a consolidated basis with its subsidiaries) exceeds, on a going concern basis, the total amount of liabilities (including contingent liabilities) of the Guarantor (on a consolidated basis with its subsidiaries);
(ii) the present fair saleable value of the assets of the Guarantor (on a consolidated basis with its subsidiaries) is greater than the total amount of liabilities (including contingent liabilities) of the Guarantor (on a consolidated basis with its subsidiaries);
(iii) the Guarantor (on a consolidated basis with its subsidiaries) is able to pay its debts and other liabilities (including contingent liabilities) as they mature in the normal course of business; and
(iv) the Guarantor (on a consolidated basis with its subsidiaries) does not have unreasonably small capital with which to conduct the business in which it is engaged, as such business is now conducted and is proposed to be conducted.
In connection with the foregoing, the Guarantor confirms that a Solvency Certificate has been delivered by Rebecca Sung, Chief Financial Officer of the Guarantor, on June 3, 2024, as required by the Credit Agreement, and the representations and certifications set forth therein are true and correct in all material respects as of the date of delivery thereof.
Section 3.06 — Litigation
There are no actions, suits, proceedings, arbitrations, investigations, or claims pending or, to the knowledge of the Guarantor, threatened against or affecting the Guarantor before any court, governmental authority, arbitrator, or other tribunal that (a) could reasonably be expected to have a Material Adverse Effect on the Guarantor's ability to perform its obligations under this Guarantee Agreement or (b) purport to affect or pertain to this Guarantee Agreement or any of the transactions contemplated hereby.
Section 3.07 — OFAC and Sanctions Compliance
(a) Neither the Guarantor nor any of its subsidiaries, nor any director, officer, or, to the knowledge of the Guarantor, employee or agent of the Guarantor or any of its subsidiaries, is a Sanctioned Person (as defined in the Credit Agreement). For the avoidance of doubt, a "Sanctioned Person" includes any Person that is (i) listed on, or owned or controlled by any Person listed on, the Specially Designated Nationals and blocked Persons List or the Sectoral Sanctions Identifications List maintained by the Office of Foreign Assets Control of the U.S. Department of the Treasury ("OFAC"), or any similar list maintained by the U.S. Department of State, the United Nations Security Council, the European Union, Her Majesty's Treasury of the United Kingdom, or any other relevant sanctions authority, or (ii) located, organized, or resident in a Sanctioned Country (as defined in the Credit Agreement).
(b) The Guarantor and its subsidiaries are in compliance with all applicable sanctions laws and regulations, including those administered by OFAC, the U.S. Department of State, and the European Union (including Council Regulation (EU) No. 269/2014 concerning restrictive measures in respect of actions undermining or threatening the territorial integrity, sovereignty, and independence of Ukraine, and all related and successor regulations).
(c) The Guarantor confirms that it has delivered to the Administrative Agent, on or prior to the Closing Date, a beneficial ownership certification in compliance with the Financial Crimes Enforcement Network ("FinCEN") Customer Due Diligence Rule (31 C.F.R. § 1010.230), and the information contained therein is true and correct in all respects.
(d) None of the proceeds of the Term Loan will be used, directly or indirectly, by the Guarantor or any of its subsidiaries, or lent, contributed, or otherwise made available to any Person, for the purpose of financing the activities of any Sanctioned Person or in any Sanctioned Country, or in any other manner that would result in a violation of any sanctions laws or regulations applicable to any Secured Party.
Section 3.08 — Financial Condition
The financial statements heretofore delivered by or on behalf of the Guarantor to the Administrative Agent under the Credit Agreement, including the audited consolidated financial statements for the fiscal year ended December 31, 2023, and the unaudited consolidated financial statements for the fiscal quarter ended March 31, 2024, fairly present in all material respects the consolidated financial condition and results of operations of the Guarantor and its subsidiaries as of the dates and for the periods indicated therein, in accordance with GAAP (subject, in the case of unaudited financial statements, to the absence of footnotes and normal year-end audit adjustments). Without limitation:
(a) the Adjusted EBITDA of the Guarantor and its subsidiaries for the twelve-month period ended March 31, 2024 (the "LTM Period") was $165.8 million;
(b) the revenue of the Guarantor and its subsidiaries for the twelve-month period ended September 30, 2023 was $412.6 million;
(c) the total assets of the Guarantor and its subsidiaries as of March 31, 2024 were approximately $1.87 billion; and
(d) the pro forma Net Leverage Ratio of the Guarantor and its subsidiaries at the Closing Date (after giving effect to the transactions contemplated by the Credit Agreement) is 5.35x (calculated as Net Total Debt of $887.5 million divided by Adjusted EBITDA of $165.8 million), which is within the maximum Net Leverage Ratio covenant of 6.00x.
Since March 31, 2024, there has been no change, occurrence, or development that has had, or could reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect on the Guarantor or its subsidiaries taken as a whole.
Section 3.09 — Tax Matters
The Guarantor has filed, or caused to be filed, all material federal, state, and local tax returns and reports required to be filed by it, and has paid, or caused to be paid, all taxes, assessments, fees, and other governmental charges levied upon it or any of its properties or assets that are due and payable, except for those taxes that are being contested in good faith by appropriate proceedings diligently conducted and for which adequate reserves have been established in accordance with GAAP. There are no material tax liens upon any property or asset of the Guarantor (other than liens for taxes not yet due and payable).
ARTICLE IV — COVENANTS
The Guarantor hereby covenants and agrees with the Administrative Agent, for the ratable benefit of the Secured Parties, that from and after the date hereof and until the Termination Date:
Section 4.01 — Compliance with Credit Agreement
The Guarantor shall not take, or permit to be taken, any action that would cause a breach of or default under any covenant contained in the Credit Agreement (including the affirmative covenants, negative covenants, and financial covenants set forth therein) or any other Loan Document. Without limiting the generality of the foregoing, the Guarantor shall use commercially reasonable efforts to cause the Borrower and its subsidiaries to comply with the following financial covenants (as more fully set forth in the Credit Agreement):
(a) Maximum Net Leverage Ratio: The Net Leverage Ratio of the Borrower and its subsidiaries (on a consolidated basis) shall not exceed 6.00 to 1.00 as of the last day of any fiscal quarter, commencing with the fiscal quarter ending September 30, 2024, and tested quarterly thereafter.
(b) Minimum Interest Coverage Ratio: The Interest Coverage Ratio of the Borrower and its subsidiaries (on a consolidated basis) shall not be less than 2.00 to 1.00 as of the last day of any fiscal quarter, commencing with the fiscal quarter ending September 30, 2024, and tested quarterly thereafter.
(c) Maximum Capital Expenditures: The aggregate capital expenditures of the Borrower and its subsidiaries (on a consolidated basis) shall not exceed (i) $325,000,000 for the fiscal year ending December 31, 2024, and (ii) $250,000,000 for each fiscal year thereafter (commencing with the fiscal year ending December 31, 2025), in each case with the right to carry forward up to 25% of any unused amount from the immediately preceding fiscal year to the next succeeding fiscal year.
Section 4.02 — Preservation of Corporate Existence
The Guarantor shall maintain and preserve (a) its corporate existence under the laws of the State of Delaware and (b) its qualification and good standing in each other jurisdiction where the failure to maintain such qualification could reasonably be expected to have a Material Adverse Effect. The Guarantor shall maintain its status as the direct, sole owner of 100% of the issued and outstanding membership interests of the Borrower (Ironhaven Data Centers LLC), free and clear of all liens, claims, encumbrances, and restrictions on transfer (other than those created pursuant to the Loan Documents and those arising under applicable securities laws), and shall not sell, transfer, assign, or otherwise dispose of any such membership interests, except as expressly permitted by the Credit Agreement.
Section 4.03 — Change of Control
(a) The Guarantor acknowledges and agrees that the Credit Agreement contains a mandatory prepayment provision requiring the Borrower to prepay the Term Loan in full at a price equal to 101% of the outstanding principal amount thereof, plus all accrued and unpaid interest thereon and all other amounts then payable under the Loan Documents, upon the occurrence of a Change of Control (as defined in the Credit Agreement).
(b) For purposes of this Section 4.03, a "Change of Control" includes, without limitation, any event or series of events as a result of which (i) Thornfield Capital Partners, LP (or its affiliates, including Thornfield Infrastructure Fund III, LP) ceases to hold, directly or indirectly, more than 50% of the aggregate voting equity interests of Ironhaven Holdings Inc., (ii) Ironhaven Holdings Inc. ceases to directly own 100% of the membership interests of the Borrower, or (iii) any other event described as a "Change of Control" in the Credit Agreement.
(c) The Guarantor covenants that it shall provide prompt written notice (and in any event not later than five (5) Business Days after the occurrence or, if earlier, the knowledge of the Guarantor of the occurrence or prospective occurrence) to the Administrative Agent of any Change of Control event or any event or circumstance that could reasonably be expected to give rise to a Change of Control.
Section 4.04 — Information Covenants
The Guarantor shall provide, or shall cause the Borrower to provide, to the Administrative Agent all financial statements, compliance certificates, and other information required to be delivered under the Credit Agreement within the time periods specified therein. Without limiting the foregoing, the Guarantor shall cause to be delivered to the Administrative Agent quarterly compliance certificates in the form required by the Credit Agreement (substantially in the form attached hereto as Exhibit A or in such other form as may be reasonably acceptable to the Administrative Agent), signed by a Responsible Officer of the Borrower, demonstrating compliance with the financial covenants set forth in the Credit Agreement as of the last day of each fiscal quarter.
Section 4.05 — Maintenance of Collateral
The Guarantor shall not take, and shall not permit any of its subsidiaries to take, any action that would impair, diminish, or adversely affect the validity, perfection, priority, or enforceability of the Secured Parties' security interests in any collateral securing the Guaranteed Obligations, including without limitation:
(a) the pledge by the Guarantor of 100% of the membership interests of the Borrower (Ironhaven Data Centers LLC) to the Collateral Agent under the Equity Interest Pledge Agreement;
(b) the equity pledge of the shares of Ironhaven Frankfurt GmbH by the Borrower to the Collateral Agent under the applicable German-law share pledge agreement;
(c) the deed of trust and related security instruments encumbering the Virginia campus parcels (Tax Parcel Nos. 087-27-1234 and 087-27-1235) in favor of the Collateral Agent;
(d) all UCC financing statements filed in connection with the security interests granted under the Loan Documents; and
(e) all other collateral described in the Credit Agreement and the other Loan Documents.
The Guarantor shall ensure that all UCC financing statements remain effective and that all continuation statements required under Article 9 of the Uniform Commercial Code are timely filed prior to the lapse of any such financing statement, in each case in the applicable filing offices.
Section 4.06 — Restricted Payments
The Guarantor shall comply, and shall cause each of its subsidiaries to comply, with the restricted payments covenant set forth in the Credit Agreement. Without limiting the foregoing, the Guarantor shall not declare, make, or pay any dividend, distribution, or other restricted payment (whether in cash, securities, or other property) to its stockholders or any other Person, except as expressly permitted under the Credit Agreement. The Guarantor acknowledges that any violation of the restricted payments covenant by the Borrower or any subsidiary shall constitute an Event of Default under the Credit Agreement and, consequently, under this Guarantee Agreement.
ARTICLE V — EVENTS OF DEFAULT
Section 5.01 — Events of Default Under Credit Agreement
The occurrence and continuance of any Event of Default under the Credit Agreement (as defined therein) shall constitute an event of default under this Guarantee Agreement (each, a "Guarantee Default"). Without limiting the generality of the foregoing, the following shall each constitute a Guarantee Default:
(a) the failure by the Borrower or the Co-Borrower to pay any principal of the Term Loan when due, whether at stated maturity, upon required prepayment, by acceleration, or otherwise;
(b) the failure by the Borrower or the Co-Borrower to pay any interest, fee, or other amount payable under the Credit Agreement or any other Loan Document within the applicable grace period set forth therein;
(c) a breach by the Borrower or any Loan Party of any financial covenant set forth in the Credit Agreement, including the maximum Net Leverage Ratio of 6.00x or the minimum Interest Coverage Ratio of 2.00x;
(d) any representation or warranty made or deemed made by any Loan Party in the Credit Agreement or any other Loan Document proving to have been incorrect in any material respect when made or deemed made;
(e) a cross-default to other material indebtedness as set forth in the Credit Agreement (including a default under indebtedness in an aggregate principal amount exceeding $25,000,000);
(f) the commencement of any voluntary or involuntary bankruptcy, insolvency, reorganization, arrangement, or similar proceeding with respect to any Loan Party;
(g) the occurrence of a Change of Control (triggering the mandatory prepayment obligation at 101% of outstanding principal plus accrued and unpaid interest);
(h) one or more judgments, orders, or awards for the payment of money in an aggregate amount exceeding $25,000,000 (to the extent not covered by insurance or indemnification) being rendered against any Loan Party and remaining unsatisfied, unvacated, unbonded, unstayed, and undischarged for a period of sixty (60) consecutive days;
(i) the occurrence of any ERISA Event that, individually or in the aggregate, could reasonably be expected to result in a Material Adverse Effect;
(j) the invalidity, unenforceability, or termination of any Loan Document or any security interest purported to be created thereunder; and
(k) any other event or condition described as an "Event of Default" under the Credit Agreement.
Section 5.02 — Remedies Upon Default
(a) Upon the occurrence and during the continuance of any Guarantee Default, the Administrative Agent, acting on behalf of and for the ratable benefit of the Secured Parties, may (and upon the direction of the Required Lenders shall) deliver written notice to the Guarantor demanding immediate payment by the Guarantor of all or any part of the Guaranteed Obligations then outstanding. Upon receipt of such demand, the Guarantor shall immediately pay to the Administrative Agent, for the account of the Secured Parties, the full amount of all Guaranteed Obligations so demanded, without any deduction, set-off, counterclaim, or defense.
(b) No requirement shall exist for the Administrative Agent, the Collateral Agent, or any Secured Party to first proceed against the Borrower, the Co-Borrower, any other guarantor (if any), or any collateral before proceeding against the Guarantor under this Guarantee Agreement. The Administrative Agent, the Collateral Agent, and each Secured Party may, at their sole discretion, proceed directly against the Guarantor without first exhausting any other remedy or taking any other action.
(c) All rights and remedies of the Administrative Agent, the Collateral Agent, and the Secured Parties under this Guarantee Agreement, the Credit Agreement, and the other Loan Documents are cumulative and not exclusive of any other rights or remedies that any such Person may have, whether at law, in equity, by statute, or otherwise. No failure or delay on the part of the Administrative Agent, the Collateral Agent, or any Secured Party in exercising any right, remedy, or power hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such right, remedy, or power preclude any other or further exercise thereof or the exercise of any other right, remedy, or power.
ARTICLE VI — THE ADMINISTRATIVE AGENT
Section 6.01 — Appointment and Authority
The Guarantor hereby acknowledges and agrees that Crescent Harbor Bank, N.A., in its capacity as Administrative Agent, acts for the benefit of, and as agent for, the Secured Parties under and in connection with this Guarantee Agreement. The Guarantor agrees to deal exclusively with the Administrative Agent, and not with individual Lenders, regarding all matters arising under or relating to this Guarantee Agreement, including without limitation the delivery of notices, the making of demands, and the receipt of payments. All notices, demands, and other communications from the Guarantor to the Secured Parties shall be directed to the Administrative Agent at the following address:
Crescent Harbor Bank, National Association 1200 Harbor Point Drive Charlotte, North Carolina 28202
Attention: Martin Gallagher, Managing Director, Leveraged & Structured Finance
with a copy to:
Thomas Beckett, Vice President, Loan Operations & Agency Services (at the same address)
The rights and obligations of the Administrative Agent hereunder are subject to the provisions of the Credit Agreement governing the Administrative Agent, all of which are incorporated herein by reference.
Section 6.02 — Collateral Agent
The Guarantor hereby acknowledges and agrees that Pinnacle Trust Company, N.A., in its capacity as Collateral Agent and Security Trustee (including in its capacity through its London branch for the German-law security package under the parallel-debt structure (Parallelverpflichtung)), acts for the benefit of, and as agent for, the Secured Parties in connection with the holding, administration, and enforcement of the collateral securing the Guaranteed Obligations. All notices to the Collateral Agent shall be directed to:
Pinnacle Trust Company, N.A. 101 Constitution Avenue NW Washington, D.C. 20001
Attention: William Hargrove, Senior Vice President, Corporate Trust
The rights, obligations, protections, and immunities of the Collateral Agent hereunder are subject to the provisions of the Credit Agreement, the Security Agreement, and the other Loan Documents governing the Collateral Agent, all of which are incorporated herein by reference.
ARTICLE VII — MISCELLANEOUS
Section 7.01 — Notices
All notices, demands, requests, consents, approvals, and other communications required or permitted hereunder shall be in writing and shall be delivered personally, by recognized overnight courier service (such as Sundial Data Systems or Tarrant & Co.), or by email (with confirmation of receipt by the intended recipient), and shall be deemed to have been given (a) when delivered personally, (b) one (1) Business Day after deposit with a recognized overnight courier service, or (c) when sent by email (with confirmation of receipt), in each case addressed as follows (or to such other address as any party may designate by written notice to the other parties in accordance with this Section 7.01):
If to the Guarantor:
Ironhaven Holdings Inc. 4500 Dominion Ridge Boulevard, Suite 300 Ashburn, Virginia 20147
Attention: Jonathan Pryce-Williams, General Counsel & Secretary
Email: jpryce-williams@ironhaven.com
with a copy to:
Natasha Greenfeld, Vice President, Treasury & Capital Markets (at the same address)