Jim and Andrew. Continuity Is Not Optional. It Is the Strategy.
Executive Retention and Value Protection Plan
Alignment for Stability Through Final Phase of Five Year Plan
Strategic Context
Purpose of This Proposal
Critical Phase
Channel Partners is entering the most valuable phase of its five year value creation plan, where revenue acceleration, margin expansion, and exit multiple are realized.
Leadership Continuity
Leadership stability is the single highest leverage variable in this phase. Disruption now would have an outsized negative impact on enterprise value.
Clarity and Alignment
This proposal exists to ensure clarity, alignment, and stability through completion. It removes ambiguity before it becomes risk.
This is not a routine compensation discussion. It is a governance and continuity decision tied to the final phase of our five year value creation plan. The question before us is which path best preserves and maximizes enterprise value at this stage.
Executive Partnership
Executive Intent and Partnership
Partnership Approach
Andrew Catapano views his role as a partnership with the CEO and the board. He is deeply committed to finishing what he helped start, and the work remains energizing and aligned with the company's long term vision.
Good Faith Proposal
He respects the board's authority and direction and accepts its decision. This proposal is offered in good faith to create clarity and alignment, not pressure. Andrew has been clear in his intent: he wants to stay and finish what he helped build.
Transparent Evaluation
After operating for more than two years without documented clarity around scope, compensation progression, and long term path, he requested a formalized structure so expectations are clear and durable for all parties. He asked that this be evaluated transparently by the board rather than decided informally.
Timeline
Origin of the Retention Discussion
1
October 2025
Andrew expressed a strong desire to stay and complete the five year plan
2
Two Years Without Clarity
Expectations around role, compensation progression, and long term path remained ambiguous year to year
3
Scope and Expectation Clarity
Why now? Scope and responsibility have materially developed and as expected, are beyond a traditional COO role
4
Need for Structure
Sustaining this level of intensity and multi-role accountability required a structured, documented framework

Governance and Sustainability: Andrew raised the need for clearer executive governance and role alignment to support a flat, scalable operating model. Preference is stability and collaboration, not executive churn. Sustainable execution requires accountability, role clarity, and behavioral expectations across leadership. Retention is contingent on a healthy, governed executive environment.
Five Year Plan
Value Creation Plan Context
Years 1-4: Foundation
Integration, restructuring, and stabilization phase completed
Final Phase: Acceleration
Focus on acceleration, optimization, and exit readiness
Value Realization
Revenue acceleration, margin expansion, and exit multiple realized
Critical Insight: Disruption during the final phase materially reduces enterprise value. Leadership continuity is the highest leverage variable during this period where the company's value is maximized.
Expanded Scope
Consolidated Executive Scope Beyond COO
Andrew has consolidated multiple executive roles that would traditionally require separate C-suite positions. This represents material scope expansion beyond a traditional COO role, with demonstrated execution and value delivery across each function.
Acting CTO
Accountable for systems and platform execution. Led OpenSky Phase 1 launch consolidating all email and tenant environments. Established a path to an estimated $2-4 million in annual savings through platform consolidation.
Acting CIO
Accountable for AI, data, analytics, and enterprise support operations. Designed and led a unified one-stop operating model supporting Source, Recruit, Place, Train, Deploy, Support, and Retain across the company. Integrated AI, data, analytics, and call center operations into a single support ecosystem.
Acting CPO
Accountable for people strategy, recruiting, and organizational design. Realigned recruiting and HR under unified operational leadership. Implemented new recruiting platform reducing time to hire to approximately 14 days and cost per hire to under $400.
Acting CMO
Supporting enterprise positioning and executive client engagement. Led full rebrand including website, brand system, social presence, and content and video strategy. Positioned the company as a thought leader in AI enabled operations and governance.
Sales Innovation Owner
Executive owner of sales innovation, RFP strategy, and client storytelling. Fundamentally restructured enterprise RFP responses to position Channel Partners as a scalable operating platform. Consolidated multiple legacy websites into a single high performing branded site.
COO
Accountable for operations, integration, and execution. Rebuilt and redeployed the experiential division following leadership transition. Realigned field operations under a new leadership model to restore execution discipline and continuity. Senior executive directly responsible for enterprise revenue relationships.
Value Delivered and Value In Motion
Decisions that materially improved enterprise credibility, revenue quality, and gross margin while minimizing execution and transition risk.
Total Revenue Attributable
$3.25–3.5M+ (Best Buy base, Samsung SOWs pending)
Incremental Margin
TBD bps (pricing, scope, vendor renegotiations in motion)
Retention ROI
Minimal cash outlay; majority upside deferred to liquidity event
$2M
Avoided Replacement Cost
Annualized (absorbed Morris, Desiderio, Ghandi, Hadin functions)
$10-20M
Margin Improvement
Open Sky vs Salesforce saved millions; potential uplift at liquidity
—
Cost Avoidance
Tech-enabled asset increases exit multiple without long-term vendor obligations
Executive engagement
Increased partner confidence
RFP rewrite
50%+ win rate (up from ~10% baseline)
Best Buy close
Verbal approval 2026-01-23
Samsung continuity
SOWs expected end Jan/early Feb 2026
1
Case 1: Best Buy
Ask: Secure and expand enterprise relationship
Action: Direct executive involvement, continuity, senior engagement
Result: Verbal approval Friday 2026-01-23; base $3.25–3.5M (likely higher)
Evidence: Partner confidence increased; expanded commercial conversations unlocked
2
Case 2: Samsung
Ask: Maintain continuity and secure SOWs
Action: Senior continuity secured November 2025
Result: SOWs expected end January/early February 2026
Evidence: Continuity and direct executive engagement increased partner confidence
3
Case 3: RFP Storytelling Win
Ask: Improve enterprise win quality and deal size
Action: Reframed enterprise sales strategy and RFP storytelling to shift perception from staffing vendor to scalable operating platform
Result: 2025–2026 RFP win rate improved to 50%+ on prioritized opportunities (from ~10% baseline 2024)
Evidence: Complete reversal in RFP engagement and outcomes; direct executive leadership on every prioritized RFP materially increases win probability and deal quality
Compensation Structure
Proposed Retention Framework
Base Salary Progression
Base salary increases by $100,000 annually for each year of continued service. Current base salary of $400,000 increasing to $500,000 in 2026.
Guaranteed Bonus
50% of total annual compensation paid as guaranteed bonus due to fixed and expanded scope beyond traditional COO responsibilities.
Exit Earn Out
$1,000,000 per year of service capped at $7,000,000. Earn out payable only upon successful liquidity event, aligning incentives with company exit.
Role Progression and Expectations
Under this structure, expected progression includes elevation to President within 12-18 months. Progression contingent on continued delivery, alignment, and company performance. This formalizes what is already occurring operationally and strategically.
Board Protections
  • Earn out contingent on continued service and successful exit
  • Forfeiture or clawback if scope materially changes or performance expectations are not met
  • Mutual termination rights if alignment breaks
What the Company Gets in Return
In exchange for long-term executive continuity, the company secures the following outcomes through liquidity:
Revenue Quality and Expansion
  • Sustained executive ownership of top enterprise accounts and strategic partners
  • Improved deal size, structure, and duration through executive-led enterprise selling
  • Higher close rates on prioritized opportunities with reduced sales cycle risk
Margin Expansion and Cost Discipline
  • Centralized executive control over operating leverage and delivery economics
  • Reduced margin leakage through disciplined scope control, pricing, and execution
  • Lower fixed cost risk versus executive replacement or layered leadership
Scalable and Repeatable Go-to-Market
  • Codification of enterprise sales and RFP storytelling into repeatable operating motions
  • Reduced dependency on one-off heroics or ad hoc sales execution
  • Platform positioning versus staffing perception, improving valuation multiple
Sustainable Contributable Income
  • Higher quality, longer-duration revenue with clearer contribution margins
  • Improved predictability of cash flow and earnings profile
  • Stronger EBITDA durability and exit-readiness for financial buyers
Net Effect for Ownership
  • De-risks revenue continuity through exit
  • Increases valuation through higher-quality earnings
  • Preserves institutional knowledge critical to scaling without margin erosion
Alternative Path
Orderly Transition if Retention Not Approved
1
Orderly Transition
Andrew is prepared to transition out of the COO role in an orderly manner if retention is not approved
2
Transition Period
Mutually agreed transition period to ensure leadership and client continuity
3
Advisory Continuity
Advisory consulting agreement to preserve institutional knowledge, operational stability, and transaction readiness

Advisory Scope: Limited to strategic operations, executive transition support, and sale preparation. This approach avoids abrupt disruption and protects enterprise relationships, operational momentum, and strategic continuity.
Both outcomes are acceptable and protect the company. The question is which path best preserves and maximizes enterprise value at this stage.
Decision Framing
Board Decision
Option 1: Retention
Retain leadership continuity through the final phase of the five year plan under documented structure
Option 2: Transition
Approve orderly COO transition with advisory continuity support
Timeline: Alignment required prior to the March compensation cycle.
Final Takeaway
  • The plan is working
  • The highest value phase is ahead
  • Stability maximizes upside
  • Disruption introduces unnecessary risk
  • Alignment benefits all stakeholders
Both outcomes are acceptable and protect the company. This proposal provides a clean decision with no bad outcomes, ensuring Channel Partners maintains momentum through its most valuable phase.