Ephraim Fields of Echo Lake Capital Criticizes Board's Decision to Increase Senior Management's Compensation at Edgewater

 Ephraim Fields of Echo Lake Capital Criticizes Board's Decision to Increase
        Senior Management's Compensation at Edgewater Technology, Inc.

- Questions what CEO has accomplished to deserve 21% increase in minimum base

- Notes compensation of top four executives in 2012 was almost 2x company's
total net income.

- Asks if Board of Directors will also be receiving pay increases.

- Asks if all EDGW employees will be receiving significant pay increases or
just senior management.

- Questions why 8-K was filed late on a Friday, two days after Agreements were

- Questions justification for increased severance and change of control

PR Newswire

NEW YORK, Dec. 18, 2013

NEW YORK, Dec. 18, 2013 /PRNewswire/ --Mr. Ephraim Fields of Echo Lake
Capital today announced he had issued the following letter to the Board of
Directors of Edgewater Technology, Inc. (EDGW).

December 18, 2013


Shirley Singleton
Paul Flynn
Paul Guzzi
Nancy Leaming
Michael Loeb
Daniel O'Connell
Wayne Wilson

It appears to us that Christmas once again came early and undeservedly for the
senior management of Edgewater Technology, Inc. ("EDGW") as a recent 8-K
filing indicates you approved significant compensation increases for them.

Your decision to continually provide increased compensation for people whom we
believe have repeatedly underperformed (based on both qualitative and
quantitative measures) raises serious questions about both your motivations
and willingness to uphold your fiduciary responsibility to act in the best
interests of all shareholders.

Furthermore, we believeyour decision to file the 8-K late in the day on a
Friday, two days after signing the Agreements, raises questions about the
level of transparency the company is providing its stakeholders. If the
Agreements were approved on December 4th, why was the 8-K not filed until late
in the day on Friday December 6^th? Since it does not typically take the
company that long to file an 8-K, we wonder if you were attempting to "bury"
the filing and minimize attention it would receive from EDGW's various

We remain concerned that there is an inappropriately "cozy" relationship at
EDGW whereby Board Members (whom, as we have discussed in our previous
letters, we believe are overpaid, lack appropriate skills and lack appropriate
incentives) continue to enrich senior management (including the Chairman of
the Board) and, in exchange, the Board Members themselves are also rewarded
with increasingly generous compensation. While such a relationship might be
great for you and senior management, it sadly comes at the expense of EDGW's
non-management shareholders.

After reading the 8-K we have some questions which we believe would be of
interest to EDGW's various stakeholders:

1.Considering Ms. Singleton, Mr. Clancey, Ms. Ranzal-Knowles and Mr. Oakes
    collectively made $2.8 million in 2012 (the last year for which such data
    is available), which was almost 2x the company's net income for that year,
    do you really believe these individuals deserve even more compensation?
2.What exactly has Ms. Singleton accomplished to deserve a contract
    extension and a 21% increase in her minimum annual base salary for 2014?
    Do you feel she has management skills, technological insights or other
    attributes that cannot be provided by other, less expensive CEOs? You can
    clearly see how EDGW's stock has repeatedly underperformed over the past
    10 years under her leadership, so why do you continue to retain her
    services? On a related note, have you ever conducted any confidential
    internal research to determine how Ms. Singleton is viewed by EDGW's
    employees? (You can probably guess what our research has concluded).
3.Now that you have granted senior management significant pay increases for
    2014, will you, the Board of Directors also be receiving pay increases?
4.Now that you have granted Ms. Singleton and Mr. Clancey increases in their
    minimum annual base salary for 2014 of 21% and 25%, respectively, can all
    EDGW employees expect similar pay increases?
5.What is your justification for approving even more generous change of
    control packages? Clearly a potential result of this is to further enrich
    senior management while harming shareholders by reducing the price a
    potential acquirer would pay for EDGW's shares.

The 8-K included other compensation increases which we also find distasteful
and not in the best interests of EDGW's shareholders. If you believe you can
continue to cover over both your and senior management's long-standing poor
performance by burying 8-K filings and by issuing irrelevant and self-serving
press releases, we strongly suggest you refocus your efforts and begin to
take steps that are truly in the best interests of all the shareholders.


Ephraim Fields

Contact: Ephraim Fields at (212) 259-0530

SOURCE Ephraim Fields
Press spacebar to pause and continue. Press esc to stop.