Rand Capital Corporation · NASDAQ:RAND
Rand Capital — Proxy Contest (April 2019)
14 slides from Rand Capital's proxy contest presentation, Apr 18, 2019
Slide 1: Cautionary Statement and Press Release: Definitive Proxy Filed
Cautionary Statement Regarding Forward-Looking Statements Participants in the Solicitation Rand Capital and its directors, executive officers, employees and other persons may be deemed to be participants in the solicitation of proxies from the shareholders of Rand Capital in respect of the proposed
Slide 2: The Transformation of Rand Capital Corporation
The Transformation of Rand Capital Corporation April 2019 Allen F. “Pete” Grum, President & CEO Daniel P. Penberthy, Executive Vice President & CFO Nasdaq: RAND
Slide 3: Cautionary Statement Regarding Forward-Looking Statements
Cautionary StatementRegarding Forward-Looking Statements ‘This presentation contains forward-looking statements’ within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21€ of the Securities Exchange Act of 1934, as amended. all statements, otherthan historical facts
Slide 4: Shareholder vote: Board recommends voting FOR each proposal
Sharehold The Board of Directors unanimously recommends that you vote “FOR” each of the proposals: “FOR” 1. The issuance and sale of ~8.3 million shares to East at $3.00 per share, which 4 price is below the net asset value of $4.99 per share as of December 31, 2018 2. The issuance of shares to East
Slide 5: Why support the proposals made by the Board?
Why support the proposals made by the Board? $25 million strategic investment by East Asset Management enables: + Improved market valuation: $3.00 purchase price represents a 33% premium to the closing price of $2.26 per share on January 24, 2019, the day prior to the announcement of the transaction
Slide 6: Shareholders Benefit
Shareholders Benefit Tax Benefits and Special Dividend Future Dividends Valuation Eliminate corporate-level U.S. federal income taxes + Rand intends to elect RIC tax treatment. A RICis a “pass-through entity” that avoids corporate- level U.S. federal income tax + Requires distribution of accumulated
Slide 7: Participants in the Transaction
Participants i Rand Capital Corporation (“Rand” or “the Company”) Rand Capital (Nasdaq: RAND) is a Business Development Company (BDC) with a wholly-owned subsidiary licensed by the U.S. Small Business Administration (SBA) as a Small Business Investment Company (SBIC). Rand currently focuses its equi
Slide 8: Background of Transaction
Background of Transactior (The following timeline of events leading to the shareholder vote is described in greater detail in the proxy.) Established Strategic Committee of the Board and identified a variety of strategic alternatives for the Company to pursue. Advised by Keefe, Bruyette & Woods, Inc
Slide 9: Externalization of Management
Externalization of Management + Expected to reduce annual expenses as a percentage of portfolio assets + Leverages talent and enhances investment decision processes + Current management team to be employed by RCM + Broadens potential pipeline of investment opportunities + Access to a network of fami
Slide 10: Expected Lower Cost Structure
Expected Lower Cost St Annual operating expenses (S's in millions) Current? Compensation Expenses? $1.0 nla nla nla General and administrative expenses? $0.9 $0.7 $ (0.2) (22.6)% Base management fee? nla $0.5 nla nla Incentive fees® n/a - n/a n/a Total $1.9 $1.2 $ (0.7) (36.3)% 4. Currentresuits are
Slide 11: The Future
The Future Investment of $25 million from East purchase of Rand stock * Cash infusion of ~$13.4 million; $4.4 million’ to be used for expected Special Dividend * Contributed income producing portfolio assets of ~$11.6 million; yielding ~12%2 Planned Special Dividend of $1.50 per share to Rand shareh
Slide 12: Shareholder vote: Board recommends voting FOR each proposal
Sharehold The Board of Directors unanimously recommends that you vote “FOR” each of the proposals: “FOR” 1. The issuance and sale of ~8.3 million shares to East at $3.00 per share, which 4 price is below the net asset value of $4.99 per share as of December 31, 2018 2. The issuance of shares to East
Slide 13: Letter mailed to shareholders on April 18, 2019
The following letter was mailed to shareholders of Rand Capital Corporation on April 18, 2019:
Slide 14: Cautionary Statement Regarding Forward-Looking Statements
Cautionary Statement Regarding Forward-Looking Statements This letter contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements, other than historical facts, in