Rocky Mountain Chocolate Factory, Inc. · NASDAQ:RMCF
Rocky Mountain Chocolate Factory — Proxy Contest (July 2022)
39 slides from Rocky Mountain Chocolate Factory's proxy contest presentation, Jul 26, 2022
Slide 1: Rocky Mountain Chocolate Factory, Inc.
ETN CHOCOLATE FACTORY ROCKY MOUNTAIN CHOCOLATE FACTORY, INC.
Slide 2: Cautionary Statement
CAUTIONARY STATEMENT Important Aon inormatn an Ware te Fn Ineamasnn ht 2022 Aeual Masti of rnktetae ha ‘Anal Mast, Rooly Mayitin Chocolate Facto eft Conan 9 CP] hae td te date [iy dtemare ov Shedontak on ceSnparyng Mui pray cae wintTacecantc an exchange ammesen hha Stel cn Say Se Se eppomortas bye ‘
Slide 3: Rocky Mountain Chocolate Factory: unique opportunity to deliver significant value
Goes MOUNTAIN CHOCOLATE FACTORY: ique gppertunity to deliver significant value Uiniaue gpportunity to,dely mahiagement team + Aleading manufacturer of premium chocolate products sold primarily through a network of 327 franchise stores + Ranked number one in the chocolate and candy category on Newswe
Slide 4: Agenda
Agenda The New Board — 2022 Proxy Slate The New Leadership Team — New CEO and CFO (last 90 days) The New Plan — New Companywide Strategic Planning Process Underway The Business is Sound — Significant Reversal of COVID effects and Pre-COVID trends AB Value Has No Clear Plan to Increase Stockholder Va
Slide 5: Board nominees: Geygan, Arreaga, Seabert, Taylor, Riegel
wa oS Ww JEFF GEYGAN GABRIEL ARREAGA @RETT SEABERT SANDRA TAYLOR MARK RIEGEL ‘CHAIRMAN, ©o8 @ ME --
Slide 6: Elisabeth Charles to retire from Board at conclusion of AGM
ELISABETH CHARLES TO RETIRE FROM BOARD AT CONCLUSION OF AGM On June 9, 2022, Elisabeth Charles announced she would not stand for reelection at the Company's 2022 AGM, retiring at its conclusion. She simultaneously stepped down as Board Chair, succeeded by Jeff Geygan + Ms. Charles was elected a dire
Slide 7: Jeff Geygan - Chair
JEFF GEYGAN - CHAIR constituted Board rent Chair + 35 years investment management experience change to increase sustained value f RMCF stock + Chairman of Wayside , Ine.
Slide 8: Jeff Geygan - Chair
JEFF GEYGAN - CHAIR p “ Business Strategy and Transformation: year strategic plan Governance excellencs + Separated Board Chair and CEO roles oriented culture + Updated Committee charters including the creation of a Risk & Security Committee to address ESG & DEI
Slide 9: Jeff Geygan - Chair
JEFF GEYGAN - CHAIR WSTG Stock Price During Mr. Geygan's Chairmanship Geygan’s Wayside Chair Experience - 2018 today + Revenue up by 56% + EBITDA up by 148% + Stock price more than. doubled in value
Slide 10: Gabriel Arreaga
GABRIEL ARREAGA + On RMCF's Board since October 2021 (nine months tenure) + Chairman RMCF Compensation Committee ~ led structuring of new CEO compensation which em practices that reflect commitment to good compensation governance/addressed prior years’ say on pay voting results senior ipph currently
Slide 11: Brett Seabert
BRETT SEABERT + On RMCF's Board since 2017 (5 years tenure) + Appointed os the Audit Committee chair on 2/26/2019, succeeding Lee Mortenson + Elected as a director and appointed to the Audit Committee on 4/27/2017 + Co-Managing Partner and CFO, Tanamera Construction; former Deloitte auditor + 30+ ye
Slide 12: Sandra Taylor
SANDRA TAYLOR + On RMCF's Board since October 2021 (9 months tenure) + Member of RMCF Compensation, Nomination & Governance Committees + Former Starbucks Seni ie lity Executi (2003-2008) + Former public company experience (Capella Education (NASDAG:CPLA) (2006-2011) and D.E. Master Blenders (SWX:DEM
Slide 13: Mark Riegel
MARK RIEGEL + On RMCF's Board since October 2021 (9 months tenure) + Chairman of RMCF Nomination & Governance Committee + Current CEO of FroDo, a frozen dough manufacturing business + Sales and Marketing experience in CPG businesses, (Russell Stover, Ferrara, Kraft) + AB Value RMCF's 2021 Meeting of
Slide 14: New Board: Accomplishments to Date
NEW BOARD: ACCOMPLISHMENTS TO DATE
Slide 15: New Board: Accomplishments to Date
NEW BOARD: ACCOMPLISHMENTS TO DATE + New outside CEO seated early May 2022 after a multi-month third-party ‘search, bringing extensive strategic planning, manufacturing, sales and marketing, branding ond financial experience + New CFO announced July 2022 - bringing substantial financial experience a
Slide 16: Rob Sarlls - CEO/Director
ROB SARLLS - CEO/DIRECTOR + Joined RMCF early May 2022 (11 weeks) including CEO of better-for-you snack manufacturer Wyandot + Senior Vice President and SEC listed executi Ne John B. Sanfilippo & Son, Inc. (NASDA@:JBSS) one Bot the a world's largest nut processors SNeC pp ’ + Member, Board of Direct
Slide 17: Rob Sarlls - Sanfilippo Experience
ROB SARLLS - CEO/DIRECTOR Sanfilippo Experience ‘Stock price more than, tripled, and JBSS Stock Price During Mr. Sarls's Tenure: EBITDA nearly tripled, over 4 years: + Developed and executed multi-year strategic plan + Refocused on brands + Executed strategic acquisition ~ f + Championed product inn
Slide 18: Allen Arroyo - CFO
= o ) ALLEN ARROYO - CFO + Announced July 2ist ~ start date August 1 businesses, including: + SVP and CFO of Mastro's Steakhouse + Corporate Controller and Treasurer, IHOP (now Dine Brands Global, Inc. (NYSE:DIN)) and operations
Slide 19: The New Plan: New Strategic Planning Efforts
THE NEW PLAN. NEW STRATEGIC PLANNING EFFORTS + Setting the Stage for Change CFO Allen Arroyo + Topics covered included history and current state of business, competition, state of confection consumer, current and prospective manufacturing capabilities, state of franchise network, and future aspirati
Slide 20: The New Plan: New Strategic Planning Efforts
THE NEW PLAN. NEW STRATEGIC PLANNING EFFORTS ind store look and offerit + Refresh and revitalize our brand + Innovate all aspects of our business
Slide 21: The New Plan: New Strategic Planning Efforts
THE NEW PLAN. NEW STRATEGIC PLANNING EFFORTS manufacturing site ‘accountability
Slide 22: The New Plan: New Strategic Planning Efforts
THE NEW PLAN. “Se velop an NEW STRATEGIC PLANNING EFFORTS mpany is completing establishment of 10+ cross-functional committees to ‘take ownership of each significant strategic initiative + Progressive rollout of business changes to take place over next six to nine months - which will bear fruit over
Slide 23: Chocolate Factory and Candy Shop
Foe QUIT CHOCOLATE FACTORY | CHOCOLATE *] = AND- CANDY SHOP
Slide 24: The Business Is Sound: FY Sales Back to Pre-COVID Levels
THE BUSINESS IS SOUND FY SALES BACK TO PRE-COVID LEVELS Sales FYs 2018-2022 ($Ms)* Gross
Slide 25: The Business Is Sound: Q1 2023 New Franchises
THE BUSINESS IS SOUND. Q1 2023 - NEW FRANCHISES
Slide 26: The Business Is Sound: Metrics (Excluding COVID)
THE BUSINESS IS SOUND. METRICS (EXCLUDING COVID) Metric ‘Amount Best QI Since" + QI FY2023 Factory Sales Growth 2.3% QiFy2018 + Q1FY2023 Systemwide Same Store Sales 3.9%" Qi FY2006 + QI FY2023 Royalty/Marketing Income $1,809M Qi FY2020
Slide 27: We Are Communicating Fully and Effectively
THE BUSINESS IS SOU! WE ARE COMMUNICATING FULLY AND EFFECTIVELY + Dedicated PR/IR resource + Timely communications + New IR website under development nchisee engagement: +50 Visits in 50 Weeks" CEO Listening Tour + Monthly Franchisee touch base calls
Slide 28: Finally Entering the 21st Century
THE BUSINESS IS SOUND FINALLY ENTERING THE 21ST CENTURY + "Buy Online, Pickup in Store or Delivery" options ‘and Winter + DoorDash sales through chocolate-only stores increased even faster at 64% YOY DoorDash
Slide 29: Slide 29
Slide 30: It Is Time for AB Value Group to Stop Hostilities
IT 1S TIME FOR AB VALUE GROUP TO STOP HOSTILITIES Sow E CAN FOCUS INTENSELY ON SHAREHOLDER VALUE disruptive proxy fight
Slide 31: RMCF Offer
RMCF OFFER settlement offer that provides fo: the appoi (subject only to such nominee agreeing to an interview with the Board os port of the Boars exercise ofits cutest (3) 0 commitment to re-nominate that AS Value nominee in 2023; (a $60c (5) AB Vc other than as a negotiating chip.
Slide 32: AB Value Has No Clear Plan to Increase Stockholder Value
AB Value Has No Clear Plan to Increase Stockholder Value Berger OWNS Some of the Past: , Mary Thompson, were on 2021 AGM, and to affect thi just prior to it. Board room. with its nominees Sandra Taylor and Mark Riegel + Berger as a Di
Slide 33: AB Value Has No Clear Plan to Increase Stockholder Value
AB Value Has No Clear Plan to Increase Stockholder Value Berger OWNS Some of the Past (Cont) . rategy Berger which AB ught SIX FULL REPLACEMENT DIRECTORS, + Pr FOUR reward for lack of results + Just lost week, about the abrupt departure of candidate, Ms. Correne Loeffier raising concerns
Slide 34: Date of the Annual Meeting Chosen for Business Reasons
DATE OF THE ANNUAL MEETING CHOSEN FOR BUSINESS REASONS full openness to Berger * Candidacy on the 2022 Proxy Card hen in May + RMCF's Fiscal Year ends in February mpanies to hold their year en + For RMCF this is August ~ The 2022 AGM meeting date is set for August 18th kholder proxy activity ~ inthe
Slide 35: Brett Seabert and Mary Bradley
BRETT SEABERT AND MARY BRADLEY Brett Seabert, CPA + Mr. , 30+ years resources to RMCF's Board and management Mary Bradley + Nonethel ‘experience of Mr. Seabert 6 June 14, 2022,
Slide 36: Company and This Board Have Delivered on Desired Changes
COMPANY AND THIS BOARD HAVE DELIVERED ON DESIRED CHANGES + Terminated longstanding Poison Pill + Separated Chair and CEO roles + Separated CEO and CFO roles LEADERSHIP + "No Sacred Cow’ strategic review underway
Slide 37: AB Value Has No Clear Plan to Increase Stockholder Value
AB Value Has No Clear Plan to Increase Stockholder Value + AB Value does not deserve $2MM+ cash and effective control of the Board given their highly disruptive and chaotic behavior over the last 4 years and lack of any coherent plan to drive stockholder value * This is especially true now given the
Slide 38: It Is Time for AB Value Group to Stop Hostilities
IT 1S TIME FOR AB VALUE GROUP TO STOP HOSTILITIES Sow E CAN FOCUS INTENSELY ON SHAREHOLDER VALUE + It is time for the AB Value Group to end this costly and disruptive proxy fight
Slide 39: Thank You
THANK YOU
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