Contract analysis

I. Executive Summary This memorandum summarizes the results of employment and benefits due diligence conducted by Calderwood & Harkness LLP ("Calderwood & Harkness" or "we") in connection with the proposed acquisition by Cascade Retail Holdings Inc. ("Cascade" or the "Buyer") of 100% of the outstanding capital stock of NovaMart Global Inc. ("NovaMart" or the "Company") for an aggregate purchase price of $1,200,000,00

II. Workforce Overview A. Employee Headcount and Distribution Based on the most recent payroll data provided in the NovaMart data room (pay period ending February 28, 2025), the Company employs approximately 2,400 individuals across its corporate headquarters and 14 fulfillment center locations. The workforce distribution is summarized as follows: Corporate Headquarters — Austin, Texas (1100 Congress Avenue, Suite 80

I-9 Compliance. NovaMart conducted an internal I-9 audit in Q3 2024, as reflected in the audit summary provided in the data room. The audit covered a random sample of approximately 400 I-9 forms across all locations. The audit identified minor technical deficiencies (e.g., missing or incomplete Section 2 entries, late re-verification) in approximately 6% of the sampled forms. NovaMart represented that it undertook co

III. Executive Employment Agreements We have reviewed the existing employment agreements of the following senior executives of NovaMart: Julian Reeves (Founder and CEO), Priya Narasimhan (Co-Founder and CTO), Douglas "Doug" Whitfield (CFO), and Amanda Trevino (General Counsel). Set forth below is a summary of the material terms of each agreement, with particular attention to change of control provisions, severance tr

Section 280G Considerations. The aggregate payments and benefits to Mr. Reeves in connection with the Transaction — including the purchase price consideration for his equity (which is not a "parachute payment" because it represents reasonable compensation for equity held as an investor rather than an employee, to the extent it exceeds Mr. Reeves's base amount), the waiver of his existing Change of Control severance r

Section 280G Considerations. As with Mr. Reeves, the aggregate payments and benefits to Ms. Narasimhan in connection with the Transaction require Section 280G analysis. Ms. Narasimhan is a "disqualified individual" for Section 280G purposes. The analysis is being conducted by Sylvia Hartwell and Whitmore & Paige LLP. C. Douglas "Doug" Whitfield — Chief Financial Officer Current Employment Agreement. Mr. Whitfield is

IV. Equity Incentive Plan and Stock Options A. NovaMart 2016 Equity Incentive Plan — Overview NovaMart adopted the NovaMart Global Inc. 2016 Equity Incentive Plan (the "Equity Plan") effective as of July 1, 2016, as subsequently amended on March 15, 2019 (the "First Amendment") and December 1, 2021 (the "Second Amendment"). The Equity Plan was approved by the Board of Directors and the stockholders of NovaMart. The m

Section 12 of the Equity Plan defines "Change of Control" to include: (a) any merger, consolidation, or similar transaction in which the stockholders of NovaMart immediately prior to such transaction hold less than 50% of the voting power of the surviving entity; (b) any sale, transfer, or other disposition of all or substantially all of NovaMart's assets; and (c) any acquisition by any person or group of more than 5

Section 409A of the Code imposes strict requirements on nonqualified deferred compensation arrangements. Stock options that are granted with an exercise price below the fair market value of the underlying stock at the time of grant ("Discounted options") are treated as deferred compensation subject to Section 409A, and the option holder may be subject to additional taxes, including a 20% penalty tax and interest, upo

Section 280G of the Code imposes a 20% excise tax (under Section 4999) on "excess parachute payments" received by "disqualified individuals" in connection with a change of control, and denies the payor a deduction for such excess parachute payments. A "parachute payment" is any payment in the nature of compensation that is made to a disqualified individual if (i) the payment is contingent on a change of ownership or

V. Employee Benefit Plans — ERISA and Non-ERISA A. Summary of Benefit Plans Based on our review of the data room documents, NovaMart sponsors or maintains the following employee benefit plans, programs, and arrangements:

1. NovaMart Global Inc. 401(k) Retirement Savings Plan (ERISA-qualified plan)

2. NovaMart Global Inc. Group Health Insurance Plan — Medical, Dental, Vision (ERISA welfare plan; fully insured)

3. NovaMart Global Inc. Group Life Insurance and Accidental Death & Dismemberment ("AD&D") Plan (ERISA welfare plan; fully insured)

4. NovaMart Global Inc. Short-Term Disability ("STD") Plan (fully insured)

5. NovaMart Global Inc. Long-Term Disability ("LTD") Plan (ERISA welfare plan; fully insured)

6. NovaMart Global Inc. Health Savings Account ("HSA") Program (employer-contributed)

7. NovaMart Global Inc. Flexible Spending Account ("FSA") Plan (Section 125 cafeteria plan)

8. NovaMart Global Inc. Employee Assistance Program ("EAP")

9. NovaMart Global Inc. Paid Time Off ("PTO") Policy

10. NovaMart Global Inc. Parental Leave Policy (16 weeks paid leave for birth parents, 8 weeks for non-birth parents)

11. NovaMart Global Inc. Tuition Reimbursement Program (up to $5,250 per year for eligible employees)

12. NovaMart Global Inc. Severance Pay Policy (see Section VI below)

13. NovaMart Global Inc. 2016 Equity Incentive Plan (see Section IV above)

14. No formal nonqualified deferred compensation plan identified (see Section V.D below for analysis of informal arrangements) Each of these plans and programs was reviewed for compliance with applicable ERISA requirements, Code provisions, and other applicable law, as described in the subsections below. B. NovaMart 401(k) Plan Plan Identification. • Plan Name: NovaMart Global Inc. 401(k) Retirement Savings Plan • Ef