Rocky Mountain Chocolate Factory, Inc. · NASDAQ:RMCF
Rocky Mountain Chocolate Factory — Proxy Contest (July 2022)
18 slides from Rocky Mountain Chocolate Factory's proxy contest presentation, Jul 22, 2022
Slide 1: The Case for Adding a Proven Consumer Brand Leader to the Board
The Case for Adding a Proven Consumer Brand Leader to Rocky Mountain Chocolate Factory, Inc.’s Board Prepared by the AB Value-Radoff Group July 2022
Slide 2: Disclaimer
DISCLAIMER The materials contained herein (the “Materials”) represent the opinions of AB Value Partners, LP, Bradley L. Radoff and the other participants named in the proxy solicitation (collectively, the “AB Value-Radoff Group”) and are based on publicly available information with respect to Rocky
Slide 3: About the AB Value-Radoff Group
ABOUT THE AB VALUE-RADOFF GROUP Overview ▪ AB Value Management LLC and Bradley L. Radoff (together with their affiliates, the “AB Value-Radoff Group” or “we”), own approximately 17.6% of the outstanding shares of Rocky Mountain Chocolate Factory, Inc. (NASDAQ: RMCF) (“Rocky Mountain” or the “Company
Slide 4: About Rocky Mountain
ABOUT ROCKY MOUNTAIN We believe Rocky Mountain has the potential to become a beloved brand and create significant stockholder value over the long-term if it has a diverse, experienced and high-integrity Board Rocky Mountain’s Strategic Focus and Segments Rocky Mountain Recent Performance Snapshot1 (
Slide 5: Why We Are Here
WHY WE ARE HERE The AB Value-Radoff Group, which combined is the largest stockholder of Rocky Mountain, believes the Company has exceptional products, customers and long-term potential. Last year, we ran a campaign – earning the support of leading independent proxy advisory firms – which resulted in
Slide 6: Overview: Why We Are Seeking to Replace Director Seabert
OVERVIEW: WHY WE ARE SEEKING TO REPLACE DIRECTOR SEABERT We believe Mr. Seabert is unqualified to continue serving on the Company’s Board in light of his apparent conflict of interest, lack of relevant experience and problematic track record x We suspect Mr. Seabert is only on the Board because the
Slide 7: Mr. Seabert Has a Five-Year Record of Presiding Over Sizable Value Destruction
MR. SEABERT HAS A FIVE-YEAR RECORD OF PRESIDING OVER SIZABLE VALUE DESTRUCTION AT ROCKY MOUNTAIN Rocky Mountain’s refusal to engage with us is particularly disturbing when one considers that the Company’s total shareholder returns are negative over every relevant time horizon during Mr. Seabert’s te
Slide 8: Mr. Seabert Has a Five-Year Record of Presiding Over Significant Underperformance
MR. SEABERT HAS A FIVE-YEAR RECORD OF PRESIDING OVER SIGNIFICANT UNDERPERFORMANCE During Mr. Seabert’s tenure, Rocky Mountain has underperformed its peers over nearly every relevant time horizon Rocky Mountain The Hershey Company Tootsie Roll Industries, Inc. John B. Sanfilippo & Son, Inc. 160% 140%
Slide 9: Mr. Seabert Has Failed to Help Reverse Anti-Stockholder Attitude Toward Governance
WE BELIEVE MR. SEABERT HAS FAILED TO HELP REVERSE THE COMPANY’S ANTI-STOCKHOLDER ATTITUDE TOWARD GOVERNANCE During Mr. Seabert’s tenure, the Board has had a record of poor governance practices, including: Allowing Conflicts of Interest Failing to Improve Boardroom Diversity x The Board appointed Jef
Slide 10: Boardroom Dysfunction and Entrenchment Persists Today
WE BELIEVE BOARDROOM DYSFUNCTION AND ENTRENCHMENT PERSISTS TODAY AT ROCKY MOUNTAIN While the Board would like stockholders to believe that it has completely reformed Rocky Mountain over the past year, we believe that significant governance issues – which leading proxy advisory firm ISS disfavored la
Slide 11: Board's Unwillingness to Compromise Validates Our Case for Change
WE BELIEVE THE BOARD’S UNWILLINGNESS TO COMPROMISE VALIDATES OUR CASE FOR CHANGE The Board claims that we are seeking this costly election contest and disrupting the Company’s operations, but it has forced us to run this campaign after it has refused to listen to our concerns The Company refused our
Slide 12: It Appears the Board Has Lost Credibility with Stockholders
IT APPEARS THE BOARD HAS LOST CREDIBILITY WITH STOCKHOLDERS We believe Board improvement is urgently needed to course correct and responsibly oversee the Company as it embarks on a turnaround The Board has refused to agree to our settlement offer to appoint one female retail expert to the Board in e
Slide 13: Our Solution: A Highly Qualified, Diverse Director Candidate
OUR SOLUTION: A HIGHLY QUALIFIED, DIVERSE DIRECTOR CANDIDATE Mary Bradley is a high-integrity leader in the consumer brand space with extensive experience in the areas of franchising and chocolate retail operations ▪ Currently serves as Senior Vice President, Corporate Clubs at Planet Fitness, Inc.
Slide 14: How Ms. Bradley Stacks Up Against Mr. Seabert
HOW MS. BRADLEY STACKS UP AGAINST MR. SEABERT We believe our director candidate has the skills most relevant to Rocky Mountain’s needs and is best suited to help the Board improve the Company’s operations and governance Prior Retail Prior Corporate Free of Financial Operations Franchising Governance
Slide 15: Ms. Bradley's Priorities & Commitment to Stockholders
MS. BRADLEY’S PRIORITIES & COMMITMENT TO STOCKHOLDERS Ms. Bradley is committed to working with the entire Board to turn around Rocky Mountain’s underperformance and improve its franchise operations to drive long-term success Operational Improvements Financial Improvements Governance Improvements ✓ E
Slide 16: Vote on the BLUE Proxy Card Today!
VOTE ON THE BLUE PROXY CARD TODAY! Stockholders can install a highly qualified leader on Rocky Mountain’s Board by voting on the BLUE proxy card to elect Ms. Bradley at the 2022 Annual Meeting VOTE ON THE BLUE PROXY CARD! ONLY LATEST-DATED VOTE COUNTS. 16
Slide 17: Appendix
APPENDIX apckd MOURA (HOCOLATE FACTORY
Slide 18: The Board Has Appointed Leaders with an Apparent History of Value Destruction
THE BOARD HAS APPOINTED LEADERS WITH AN APPARENT HISTORY OF VALUE DESTRUCTION Mr. Geygan’s ties to Mr. Sarlls date back to 2014, when the pair were involved in a proxy contest at ALCO Stores, Inc. (“ALCO”) which ultimately resulted in the loss of $47 million ▪ ALCO entered into a definitive merger a
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