PRIVILEGED AND CONFIDENTIAL ATTORNEY-CLIENT PRIVILEGED / ATTORNEY WORK PRODUCT
Dear Anil,
I am writing to establish a coordination framework between our respective teams as we begin work on the strategic alternatives review for the Board of Directors of Aurelius Global Media Group PLC (NYSE: AGMG; LSE: AGMG.L).
As you know, the Board passed a resolution yesterday, April 22, authorizing the engagement of Stonebridge Crane & Co. as financial advisor to evaluate strategic alternatives available to the Company. Calderwood & Harkness LLP has served as independent governance counsel to the AGMG Board since March 12, 2024 (our Matter No. 1017-00002), and our engagement was formally expanded yesterday via amended engagement letter to encompass coordination with Stonebridge in connection with the strategic alternatives review. I very much look forward to working with you and your team on this important matter.
**Background and Current Engagement Landscape**
To ensure we are operating from a common understanding, let me briefly summarize the landscape the Board is navigating. The Board is currently managing two parallel and intersecting challenges. First, a contested CEO succession process following the resignation of former CEO Marcus Vane on March 8, 2024. Second, an ongoing proxy contest with Corvus Peak Capital Partners LP, which holds an approximately 8.7% stake in AGMG (approximately 35,896,200 shares of 412,600,000 shares outstanding) and has nominated three director candidates — Malcolm Trask, Vanessa Loring, and Dr. Raymond Chu — for election at the Annual General Meeting scheduled for June 7, 2024.
To oversee both the CEO succession and the activist response, the Board formed a Special Committee on March 18, 2024, chaired by Tobias Kessler and including Lucinda Farrow-Grant and Dr. Anwen Llewellyn. The strategic alternatives review was authorized as a parallel workstream, both as a component of the Board's defensive posture in response to the Corvus Peak campaign and, importantly, to discharge the Board's fiduciary obligations to explore value-maximizing options for shareholders.
I should also note that Ashworth Velmoran LLP, led by Martin Cho, serves as AGMG's standing outside counsel on general corporate and M&A matters. We established a coordination protocol with Ashworth Velmoran in March, and I will facilitate introductions between your team and Martin's to ensure seamless three-way coordination as this workstream develops.
**Proposed Coordination Framework — Roles and Responsibilities**
I would propose the following delineation of roles, consistent with the respective engagement letters and the Board's expectations:
- *Calderwood & Harkness* will provide legal advice on fiduciary duties, process integrity, Board obligations under Delaware law (including Revlon duties and market check requirements as applicable), and the governance dimensions of any strategic transaction that may be considered.
- *Stonebridge Crane* will lead on financial analysis, valuation work, market sounding (if and when authorized by the Board), identification and evaluation of potential strategic and financial counterparties, and delivery of a financial opinion if a transaction progresses to that stage.
- *Ashworth Velmoran* will serve as transaction execution counsel in the event a specific transaction moves forward, including responsibility for M&A documentation and deal execution.
I want to underscore one structural point that is important context for our working relationship: Calderwood & Harkness's engagement as governance counsel runs directly to the Board of Directors, not to management. This independence from management was a key reason the Board retained C&H separately from Ashworth Velmoran. We will be mindful of this distinction throughout the process, and I would ask that your team keep it in view as well when managing information flows and communications.
**Information Sharing Procedures**
I would propose that all substantive communications among the advisory teams in connection with the strategic alternatives review be conducted on a privileged and confidential basis. We should take care to maintain attorney-client privilege and work product protections at every stage.
To that end, my team is preparing a detailed memorandum on confidentiality and information barrier protocols, which I expect to circulate to the advisory group by the end of this week. One principle I want to flag now, given its importance: information flow between the strategic alternatives review and the CEO search process must be carefully managed. Premature disclosure of potential transaction discussions to CEO candidates could compromise both workstreams. We will propose formal wall procedures to address this.
With respect to day-to-day logistics, I would recommend that all draft materials, analyses, and presentations be shared among the advisory group through a secure document room or encrypted channels. On the C&H side, Audrey Zhou (cc'd) and Brendan Walsh will serve as day-to-day coordination contacts and can work with your team to establish the appropriate secure infrastructure. I would be grateful if you could identify your corresponding day-to-day contacts at Stonebridge.
**Joint Reporting to the Board**
I would propose that Calderwood & Harkness and Stonebridge present jointly to the Special Committee and, where appropriate, to the full Board at regular intervals — I would suggest bi-weekly, or more frequently as developments warrant. All Board presentations should be reviewed by C&H for legal accuracy and fiduciary compliance before delivery to the directors. Nadine Khalil, AGMG's General Counsel and Corporate Secretary, will coordinate scheduling and logistics for Board and committee meetings; I will copy Nadine on scheduling communications going forward.
**Stonebridge Engagement Terms**
As you are aware, C&H reviewed and provided comments on the Stonebridge engagement letter, and I appreciate the constructive back-and-forth on our April 21 mark-up. I can confirm that the final executed version reflects the agreed terms: a monthly retainer of $250,000 and a transaction fee of 0.25% of enterprise value in the event a change-of-control transaction is consummated. We will advise the Board on the interaction between the Stonebridge engagement and any fiduciary-out obligations that may arise in the context of a potential transaction.
**Upcoming Priorities and Near-Term Workstreams**
We are finalizing a memorandum on the legal framework for evaluating strategic alternatives, which I expect to deliver to the Board tomorrow, April 24. I will share it with you promptly thereafter so that your team's financial analysis is informed by the relevant legal parameters from the outset.
In terms of near-term priorities, I would suggest we focus on the following:
1. **Preliminary standalone valuation analysis** of AGMG, together with an assessment of potential value in strategic combination scenarios; 2. **Identification of the universe of potential counterparties**, both strategic and financial; and 3. **Assessment of timing considerations**, particularly in light of the June 7 AGM and the pending proxy contest with Corvus Peak.
On the subject of timing, I want to flag an important sensitivity. The proxy contest is active: AGMG filed its preliminary proxy statement on April 5, and Corvus Peak filed its preliminary proxy on April 1. We expect both sides to file definitive proxies in early May. Any strategic alternatives activity must be conducted with careful attention to the SEC proxy rules and the public disclosure implications under both U.S. securities law and applicable UK requirements. C&H will provide guidance on these constraints as the work progresses.
**Privilege and Confidentiality**
As noted above, this email and all communications between and among the advisory teams in connection with the strategic alternatives review are privileged and confidential, subject to attorney-client privilege and the work product doctrine. I would ask that you and the Stonebridge team maintain strict confidentiality and limit internal distribution of materials related to this engagement to those individuals with a direct need to know.
**Next Steps**
I would like to propose an initial call or meeting among the core advisory team members early next week to align on priorities, timeline, and working protocols. We are happy to host at our offices at 787 Seventh Avenue, or to come to you at 383 Madison Avenue, or to meet by videoconference — whatever is most convenient for your team.
In the meantime, I would be grateful if you could share your team's preferred contacts and any communication protocols you would like us to observe on the Stonebridge side.
My direct contact information, as well as that of Colette Whitman and Audrey Zhou, is below. Please do not hesitate to reach out at any time.
I look forward to working together.
Best regards,
Nathaniel Bower
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**Nathaniel Bower** Partner Calderwood & Harkness LLP 787 Seventh Avenue New York, NY 10019 Direct: +1 (212) 558-4722 Email: nbower@calderwoodharkness.com
Colette Whitman, Counsel: +1 (212) 558-4891 / cwhitman@calderwoodharkness.com Audrey Zhou, Associate: +1 (212) 558-4063 / azhou@calderwoodharkness.com
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