Contract analysis

I. PURPOSE AND BACKGROUND This memorandum is prepared for the purpose of advising and preparing Northgate Telecommunications PLC ("NTP" or "Northgate" or the "Company") principals in advance of the in-person principals meeting scheduled for Monday, August 26, 2024, at 10:00 AM EDT, to be held at Northgate Telecommunications US, Inc., 600 Lexington Avenue, 38th Floor, New York, NY 10022 (the "Meeting"). The purpose of

II. SUMMARY OF AGREED TERMS Before turning to the open issues, it is important to recapitulate the terms on which the parties have already reached agreement. This summary serves two purposes: first, it provides context for the discussions at the Meeting and demonstrates how far the negotiation has progressed; second, it may be useful as a framing device at the Meeting itself, to remind both sides of the significant v

Section 409A Compliance. The agreement will contain standard provisions designed to ensure compliance with Section 409A of the Internal Revenue Code, including six-month delay provisions for specified employees, separation-from-service definitions, and anti-acceleration rules. Agreed. Governing Law. The primary employment agreement will be governed by the laws of the State of New York, without regard to conflict-of-l

III. OPEN ISSUE #1: CHANGE IN CONTROL PROVISIONS A. Summary of Current Positions The CIC provisions remain the most contentious area of negotiation. The parties are in disagreement on multiple elements: the definition of "Change in Control" itself, the CIC severance multiplier, the Section 280G tax treatment, and the duration of benefit continuation following a CIC termination. Each is addressed below. Definition of

Section 280G Tax Treatment — No concession recommended. NTP should hold firm on the "best-net" cutback approach with no gross-up. This is a Board-level red line based on ISS and shareholder guidance, and it reflects the Company's commitment to governance best practices. As noted above, the after-tax economics of the best-net approach are substantially equivalent for Harding, which means this issue can be addressed on

1. No CIC multiplier above 2.5×. The maximum CIC cash severance is $12,031,250 (2.5 × $4,812,500).

2. No Section 280G tax gross-up. The agreement must use the "best-net" safe harbor approach with a cutback to the safe harbor limit if the cutback produces a better after-tax result for Harding. No gross-up of the Section 4999 excise tax will be provided.

3. No Board turnover trigger in the definition of Change in Control. The CIC definition must be limited to acquisition, merger/consolidation, and asset-sale triggers.

IV. OPEN ISSUE #2: RESTRICTIVE COVENANT PROVISIONS A. Summary of Current Positions The restrictive covenant provisions — principally the non-compete and non-solicitation — represent the second major area of impasse. These provisions are important to NTP for both protective and governance reasons: a CEO of a global telecommunications and enterprise SaaS company will be privy to the Company's most sensitive strategic p

1. Non-compete duration must be at least eighteen (18) months. Twelve (12) months is insufficient for a CEO of NTP's scale and competitive position and does not provide adequate protection for the Company's strategic and proprietary interests.

2. Non-compete must include geographic restrictions covering at least North America and Western Europe. A restriction limited to a single country (e.g., the United States alone) would be insufficient to protect NTP's competitive interests in its two largest revenue-generating regions.

3. Garden leave must not exceed six (6) months in duration. Garden leave beyond six months is economically excessive and undermines the deterrent effect of the non-compete by fully funding the restriction period.

4. Customer non-solicitation must be included. An employees-only non-solicitation is insufficient to protect NTP's enterprise client relationships.

V. NON-CIC SEVERANCE — SECONDARY OPEN ISSUE A secondary area of disagreement exists with respect to the non-CIC severance provisions — that is, the severance payable to Harding in the event of a termination without Cause or resignation for Good Reason outside the context of a Change in Control. Northgate's position (Draft 2): • Cash severance equal to 2× the sum of base salary and target annual bonus (2 × $4,812,500

VI. NEGOTIATION DYNAMICS ASSESSMENT A. Harding's Leverage and Motivations Marcus Elliot Harding is currently President and Chief Operating Officer of Marlowe Asset Management Digital Holdings, Inc. (NYSE: VDHI), a publicly traded digital media and technology company with a market capitalization of approximately $34 billion. At Marlowe Asset Management, Harding receives total target annual compensation of $11,125,000,