Contract analysis

From: Nathaniel Bower <nbower@calderwoodharkness.com> To: Dame Elspeth Greenvale <e.greenvale@greenvale-private.co.uk> Cc: Colette Whitman <cwhitman@calderwoodharkness.com> Date: Tue, 09 Apr 2024 05:47:00 -0000 Subject: Shareholder Rights Plan — Summary Recommendation Ahead of Tomorrow's Board Meeting

**ATTORNEY-CLIENT PRIVILEGED AND CONFIDENTIAL**

I hope this finds you well. I am writing to provide you with a concise summary of Calderwood & Harkness's recommendation regarding the proposed shareholder rights plan ("poison pill") ahead of the full Board discussion scheduled for tomorrow, April 10. This summary distills the key points from the detailed memorandum we delivered to the Board on April 8, 2024, and is intended to assist you in framing the discussion f

Calderwood & Harkness recommends **against** adoption of a shareholder rights plan at this time. This recommendation is grounded in both our legal analysis under Delaware law and our assessment of the practical and strategic consequences such a measure would have in the context of the ongoing proxy contest with Corvus Peak Capital Partners LP.

I set out below the principal considerations supporting our recommendation, each of which is developed more fully in the April 8 memorandum.

**1. Delaware Legal Framework.** Our analysis is grounded in the *Moran v. Household International* framework, which confirms the Board's authority to adopt a rights plan, and the *Unocal/Unitrin* proportionality standard, which requires that any defensive measure be reasonable in relation to the threat posed and must not be preclusive or coercive. A rights plan must be proportionate to an identified corporate threat

**2. Corvus Peak's Current Stake — 8.7%.** Corvus Peak holds approximately 8.7% of AGMG's outstanding common shares (approximately 35,896,200 shares out of 412,600,000 shares outstanding), per its amended Schedule 13D filed February 26, 2024. At this ownership level, Corvus Peak does not present the type of "creeping control" threat that has traditionally justified adoption of a rights plan. A pill triggered at or ne

**3. Proxy Advisory Firm Reaction.** Both ISS and Tarrant Partners LLC maintain well-established policies disfavoring unilateral board adoption of poison pills, particularly in the context of an ongoing proxy contest. Adoption of a rights plan at this juncture would almost certainly be cited by both firms as a negative governance factor, materially increasing the probability that they recommend in favor of some or al

**4. Shareholder Perception.** Key institutional shareholders — including Thorne Capital Management LP (6.3%), Ridgeway Asset Management Ltd. (5.1%), and Windermere Pension Trust (4.4%) — would, in our assessment, likely view adoption of a rights plan as an entrenchment measure. This could push these holders toward the Corvus Peak slate. The optics of adopting a pill during a contested CEO succession and proxy contes

**5. Nature of the Threat.** Corvus Peak is seeking three board seats via a proxy contest. This is a shareholder franchise exercise, not a hostile takeover bid or coercive accumulation strategy. A rights plan is designed to address accumulation threats, not proxy contests. Deploying one in these circumstances could be characterized as an action taken with the primary purpose of impeding the shareholder franchise, pot

**6. No "Shadow Pill" Recommendation Either.** We have also considered whether the Board should adopt a "shelf" or "shadow" rights plan — a plan that is board-approved but not yet triggered, held in reserve. We do not recommend this approach either. Even the announcement of having a plan on the shelf is likely to generate the same negative reactions from proxy advisory firms and institutional shareholders described a

**Process Recommendation for Tomorrow's Meeting**

We recommend that the Board formally resolve to decline adoption of a shareholder rights plan, documenting its deliberative process and the reasons for the decision in the board minutes. This approach demonstrates sound governance and a thoughtful, proportionate response to the activist situation — a message that can be communicated effectively to shareholders and proxy advisors alike. To that end, we have prepared a

Colette and I will be available by phone in advance of and throughout the Board meeting to address any questions the directors may have. Audrey Zhou, a senior associate on the team, will also be on standby should any supplemental research or analysis be needed in real time.

The full analysis supporting our recommendation is contained in the April 8 memorandum, which all directors should have received. Please let us know if any director requires an additional copy.

I also wanted to note that we are advancing work on the broader defensive measures analysis — a comprehensive survey of other permissible responses available to the Board in the current circumstances. We expect to deliver that memorandum to the Board by April 12.

Please do not hesitate to reach out if you would like to discuss any of the foregoing in advance of tomorrow's meeting. We are, as always, at the Board's disposal.

**Nathaniel Bower** Partner Calderwood & Harkness LLP 787 Seventh Avenue New York, NY 10019 T: +1 (212) 479-6200 D: +1 (212) 479-6218 E: nbower@calderwoodharkness.com

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