Slide 1: GameStop's Investor Presentation Reinforces the Need for More Change
GameStop’s Investor Presentation Reinforces the Need for More Change VOTE THE WHITE PROXY CARD MAY 2020
Slide 2: Executive Summary
Executive Summary • The Company’s May 21, 2020 shareholder presentation, put forth by the newly reconstituted Board, shows that the Board’s behavior has not changed despite recent Board changes - The Board seems to have intentionally manipulated its performance analysis in order to claim its perform
Slide 3: GameStop's Board Does Not Even Attempt to Defend Much of Its Woeful Record
GameStop’s Board Does Not Even Attempt to Defend Much of Its Woeful Record The Company’s presentation fails to address the following: • Horrible long-term and recent TSR, including in the period subsequent to the appointment of the new CEO and the announcement of its new “strategic plan” – in every
Slide 4: Board Changes Dates to Manufacture "Tangible Results"
GameStop’s Board Changes Dates to Manufacture “Tangible Results” Total Shareholder Return Announcement of Sept. 10, 2019 to Sept. 12, 2019 GameStop Reboot strategic plan Sep 10 Peers 0.2% Russell 2000 2.1% GameStop -10.0% -12% -10% -8% -6% -4% -2% 0% 2% 4% • GameStop’s Board claims the announcement
Slide 5: Board Changes Index to Manufacture "Tangible Results"
GameStop’s Board Changes Index to Manufacture “Tangible Results” Every year since 2003, GameStop compared its This shift in the index to which GameStop compares performance to the Dow Jones Specialty Retailers Index, Last week, for the first time EVER, the Board tried to itself appears to be an atte
Slide 6: Board Manufactures Data to Distract From Actual Performance
GameStop’s Board Manufactures Data to Distract From Actual Performance Total Shareholder Return Sept. 10, 2019 to March 11, 2020* Dow Jones Specialty Retailers -1% S&P 500 -7% 2019 Peers -15% GameStop -19% -30% -10% 10% GameStop’s Board attempts to take credit for: • April 4: GME stock climbs +10% w
Slide 7: The "Strategic Plan" Results Are Nothing for this Board to Tout
The “Strategic Plan” Results Are Nothing for this Board to Tout • GameStop began FY 2019 with over $1.6 billion in cash and ended with $500 million. Net cash fell from $800 million to $80 million • The Board did not proactively retire debt at advantageous prices. $350 million of debt was due on Octo
Slide 8: Capital Allocation Mistakes Have Created Liquidity Concerns and Eroded Shareholder Confidence
Capital Allocation Mistakes Have Created Liquidity Concerns and Eroded Shareholder Confidence • The Board eliminated the annual dividend as the Company’s credit quality deteriorated. GameStop’s stock fell 36% upon announcement of the cut and has not recovered since • The Board repurchased stock afte
Slide 9: Compensation Structure is Misaligned with Performance
GameStop’s Compensation Structure is Misaligned with Performance • Total compensation to GameStop’s Board and executives was approximately 15% of the Company’s market capitalization at fiscal year end 2019. In 2019, stockholders lost more than 65% of their investment • Management’s bonus payout was
Slide 10: Stockholder Outreach and Board Refreshment
Stockholder Outreach and Board Refreshment • Replacing half the Board in one year after 10+ years of underperformance, including a 65% decline in stock value during 2019, is not a best-in-class Board refreshment practice. • Poor management succession planning has led to 5 CEOs in 3 years. Company ju
Slide 11: The Allegation We Are Focused on Short-Term Financial Engineering is Baseless
The Allegation We Are Focused on Short-Term Financial Engineering is Baseless • In its February 12, 2019, Hestia publicly called for the repayment of the October 2019 Notes, and Permit/Hestia have always been supportive of repaying the Company’s debt at attractive prices. • Hestia and Permit recomme
Slide 12: Permit and Hestia Are Long-Term, Committed Stockholders
Permit and Hestia Are Long-Term, Committed Stockholders Who Tried to Resolve the Current Proxy Contest Amicably • Permit/Hestia entered into a Cooperation Agreement in early 2019 with the belief that the Board would honor its commitment to work constructively with us on further Board refreshment. •
Slide 13: Our Nominees Have the Experience Necessary to Create Value
Our Nominees Have the Experience Necessary to Create Value • Paul Evans has significant public company management experience, having overseen business transformations as a director and Interim CEO of Hill International (NYSE: HIL) and as the former CFO at MYR Group (Nasdaq: MYRG). Mr. Evans has also
Slide 14: Your Vote is Important! Please Vote the WHITE Card Today!
Your Vote is Important! Don’t Be Misled by GameStop’s False and Misleading Claims • GameStop’s Board has repeatedly failed shareholders • GameStop’s Board is too retail focused and ill-equipped to contributing to a share price decline of 85% over the past address the uncertainties posed by COVID-19,
Slide 15: Vote the WHITE Card
Vote the WHITE Card If you have any questions regarding your WHITE proxy card or need assistance in executing your proxy, please contact: Stockholders may call toll-free at (888) 368-0379 Email: info@saratogaproxy.com John Broderick Kurt Wolf Permit Capital Hestia Capital John.Broderick@permitcap.co
Slide 16: Appendix: Supplemental Information to "More Change is Needed" Presentation
Appendix: Supplemental Information to “More Change is Needed” Presentation GameStop’s customers and employees have become increasingly unhappy over the past year, more so than competitors Walmart and Best Buy Sentiments of “Anger” and “Disgust” spiked during the Covid-19 crisis Source: Brandwatch. 1