Avantax, Inc. · GETTEX:3EV
Avantax — Blucora — Proxy Contest (March 2021)
73 slides from Avantax's proxy contest presentation, Mar 29, 2021
Slide 1: The Need for Stockholder-Driven Change in Blucora's Boardroom
THE NEED FOR STOCKHOLDER-DRIVEN CHANGE IN BLUCORA’S BOARDROOM PREPARED BY ANCORA – MARCH 2021 www.ABetterBlucora.com
Slide 2: Presentation Disclaimer
PRESENTATION DISCLAIMER The materials contained herein (the “Materials”) represent the opinions of Ancora Catalyst Institutional, LP and its affiliates (collectively, “Ancora”) and are based on publicly available information with respect to Blucora, Inc. (“Blucora” or the “Company”). Ancora recogniz
Slide 3: Presentation Contents
PRESENTATION CONTENTS Executive Summary The Case for Meaningful Change Our Solution: The Ancora Slate The Ancora Slate’s Vision for a Better Blucora
Slide 4: Executive Summary
EXECUTIVE SUMMARY www.ABetterBlucora.com
Slide 5: About Ancora
ABOUT ANCORA We have a track record of helping companies unlock long-term value Firm Overview • Ancora is an employee-owned asset management and financial services firm founded in 2003 • The firm is headquartered in Cleveland, Ohio and has approximately 85 employees • The firm has approximately $7.8
Slide 6: About Blucora
ABOUT BLUCORA Blucora is a financial services company that consists of a wealth management division and a tax services division Avantax (Wealth Management Business) Blucora Financial Snapshot* • Tax-centric broker-dealer created from multiple acquisitions • Founded: 1996 • Provides tax-focused wealt
Slide 7: About Blucora's Peers
ABOUT BLUCORA’S PEERS Rather than rely on the aspirational and poorly-formed peer group that the Company uses for compensation purposes, we developed an objective peer group for our analyses Peer Group in 2020 Proxy Statement Peer Group Assembled by Ancora X Alliance Bernstein Holding L.P. is a dive
Slide 8: Board Has Presided Over Indefensible Long-Term Results
WE BELIEVE THE BOARD HAS PRESIDED OVER INDEFENSIBLE LONG-TERM RESULTS Blucora’s negative returns and sustained underperformance are unacceptable S&P Composite 1500 / Blucora Russell 2000 S&P 500 Diversified Financials 120% 103% 100% 86% 80% 75% 62% 60% 49% 40% 34% 20% 18% 19% 20% 10% 0% -20% -28% -4
Slide 9: Stockholders Punished by Sum-of-the-Parts Discount
STOCKHOLDERS ARE BEING PUNISHED BY A SUBSTANTIAL SUM-OF-THE-PARTS DISCOUNT Blucora is currently trading at a severely depressed valuation multiple, which we believe is directly attributable to limited investor confidence Sum-of-the-Parts Analysis ($ in mm, except per share) EBITDA 2021 Multiple TaxA
Slide 10: Board Is Wed to a Failed, Six-Year-Old Strategy
WE CONTEND THE BOARD IS WED TO A FAILED, SIX-YEAR-OLD STRATEGY The Board is trying to convince stockholders its corporate strategy and CEO are “new” when it has been pursuing evasive synergies for years Blucora’s 2019 Proxy Statement filed April 9, 2020 • Blucora has effectively operated two dispara
Slide 11: Lack of Synergies Between Avantax & TaxAct
WE SEE A LACK OF SYNGERGIES BETWEEN AVANTAX & TAXACT We fear the Board’s lack of relevant experience and poor judgement has prevented it from recognizing the lack of synergies between the Company's two businesses The Board’s mismanagement of Avantax has resulted in The Board has not run a credible,
Slide 12: Insufficient Experience Across Blucora's C-Suite
WE SEE INSUFFICIENT EXPERIENCE ACROSS BLUCORA’S C-SUITE In our view, the Board’s poor succession planning has left Blucora with inexperienced leaders Chris Walters Marc Mehlman Chief Executive Officer Chief Financial Officer x No hands-on wealth management x Longest-standing Board member, x No prior
Slide 13: Inexperienced, Unqualified Board That Bears Responsibility
WE SEE AN INEXPERIENCED, UNQUALIFIED BOARD THAT BEARS RESPONSIBILITY The directors Ancora is seeking to replace are underqualified and have presided over sobering value destruction, yet they are allowing the Company to spend a seven-figure sum to fight us Steve Aldrich Georganne Proctor John MacIlwa
Slide 14: Board Has Fostered Terrible Corporate Governance
THE BOARD HAS FOSTERED TERRIBLE CORPORATE GOVERNANCE Before and after Blucora’s failed self-directed Board refresh, the Company’s governance, management oversight, and executive succession planning have been dismal Authorizing Excessive Filling the C-Suite with Initiating Duplicitous Leadership Comp
Slide 15: Board Has Awarded Mr. Walters Excessive Compensation
THE BOARD HAS AWARDED MR. WALTERS EXCESSIVE COMPENSATION Why did the Board authorize 2020 compensation for Mr. Walters that far exceeded the vast majority of his peers? Compensation for Chief Stockholder Return Under Chief Company Current Market Cap Executive* Executive** Blucora ~$780 Million $8,15
Slide 16: Board Has Authorized Scorched-Earth Tactics
THE BOARD HAS AUTHORIZED SCORCHED-EARTH TACTICS Stockholders may be alarmed to learn that the Board has allowed the Company’s advisors to send a stream of seemingly harassing letters to Ancora and its nominees Letter #7 Letter #2 Letter #10 Letter #4 Feb. 16, 2021 Feb. 21, 2021 Feb. 26, 2021 March 2
Slide 17: Board Cannot Re-Write History on Strategy
THE BOARD CANNOT RE-WRITE HISTORY WHEN IT COMES TO ITS STRATEGY The incumbents are – and have been – wed to an ineffective strategy that has been in place since Mr. Walters joined the Board in 2014 • In October 2015, the Company called its acquisition of HD Vest Financial Services a “[t]ransformativ
Slide 18: Board Has Not Engaged in Good Faith with Ancora
THE BOARD HAS NOT ENGAGED IN GOOD FAITH WITH ANCORA Blucora did not make any attempt to avert an election contest No Independent Director Engaged with No Attempt Was Made to Reach a Good Ancora This Past Winter Faith Resolution Throughout the winter and prior to us filing a proxy The Board did not p
Slide 19: Our Solution: Four Highly-Qualified Director Candidates
OUR SOLUTION: FOUR HIGHLY-QUALIFIED DIRECTOR CANDIDATES WITH STRONG FINANCIAL SERVICES BACKGROUNDS Frederick D. DiSanto Cindy Schulze Flynn Robert D. MacKinlay Kimberly Smith Spacek • Three decades of leadership • More than 25 years of experience • 20+ years of robust experience • Two decades of fin
Slide 20: Ancora Slate Will Ask Board to Consider Value-Enhancing Vision
OUR SOLUTION: THE ANCORA SLATE WILL ASK THE BOARD TO CONSIDER A VALUE-ENHANCING VISION Focus Blucora’s Precious Resources on Create a Special Committee to Explore Avantax Strategic Alternatives for TaxAct Re-directing the Company toward operating, A special committee of independent directors improvi
Slide 21: The Case for Meaningful Change
THE CASE FOR MEANINGFUL CHANGE www.ABetterBlucora.com
Slide 22: Sustained Value Destruction Under Current CEO
SUSTAINED VALUE DESTRUCTION UNDER CURRENT CHIEF EXECUTIVE OFFICER Stockholders have suffered large losses over several time horizons despite a booming economy S&P Composite 1500 / Blucora Russell 2000 S&P 500 Diversified Financials 120% 103% 100% 86% 80% 75% 62% 60% 49% 40% 34% 20% 18% 19% 20% 10% 0
Slide 23: Staggering Underperformance Versus Avantax Peers
STAGGERING UNDERPERFORMANCE VERSUS AVANTAX PEERS Blucora has dramatically underperformed Avantax wealth management peers for years 200% 175.7% 150% 103.9% 100.5% 100% 92.3% 82.4% 62.3% 65.1% 62.8% 47.6% 50% 43.3% 35.9% 25.0% 28.1% 18.2% 0% -28.0% -50% -39.1% BCOR BSIG ENV FOCS VRTS WDR 1 Year 3 Year
Slide 24: Compared to TaxAct Peers, Blucora Falls Short
WHEN COMPARED TO TAXACT PEERS, BLUCORA ALSO FALLS SHORT The Company has unimpressive TSR figures when stacked against other do-it-yourself tax preparation solutions 350% 312.5% 300% 250% 200% 146.6% 150% 100% 62.3% 46.1% 50% 0% -50% -28.0% -27.8% -30.0% -39.1% -40.8% -100% BCOR HRB INTU 1 Year 3 Yea
Slide 25: Blucora's Defined Peer Group Shows Detachment from Reality
BLUCORA’S DEFINED PEER GROUP SHOWS DETACHMENT FROM REALITY The Company compares itself to entities that operate in completely different sectors with market capitalizations many times Blucora’s size • The average market cap of the Company’s peer group is 12,000 Blucora’s Peer Group: Market Cap Compar
Slide 26: Board Has Overseen a Failed 6-Year-Old Corporate Strategy
BLUCORA’S BOARD HAS OVERSEEN A FAILED, 6-YEAR-OLD CORPORATE STRATEGY The Board is trying to convince stockholders that its corporate strategy is “new” when it has been doubling down on tax synergies for years Blucora’s 2019 Proxy Statement filed April 9, 2020 • Blucora has effectively operated two d
Slide 27: Tax-Focused Cross-Business Strategy Is Not "New"
THE BOARD’S TAX-FOCUSED, CROSS-BUSINESS STRATEGY IS IN NO SHAPE OR FORM “NEW” We believe stockholders will see through the Board’s feeble attempt to place blame on prior management for its own actions CEO John Clendening: Blucora’s 2017 Proxy Blucora’s March 15, 2021 Letter to Stockholders CEO Chris
Slide 28: Sum-of-the-Parts Discount
STOCKHOLDERS ARE BEING PUNISHED BY A SUBSTANTIAL SUM-OF-THE-PARTS DISCOUNT Blucora is currently trading at a severely depressed valuation multiple Sum-of-the-Parts Analysis ($ in mm, except per share) • We believe the Company’s sum-of-the-parts (“SOTP”) EBITDA 2021 Multiple discount is directly attr
Slide 29: Steep Discount to Private Market Value
BLUCORA IS TRADING AT A STEEP DISCOUNT TO PRIVATE MARKET VALUE Private market transaction multiples for both tax-related and RIA assets are substantially higher than Blucora’s current valuation multiple • Tax assets have attracted considerable interest and favorable valuations recently from strategi
Slide 30: Unacceptable Corporate Spending Persists
THE BOARD HAS ALLOWED UNACCEPTABLE CORPORATE SPENDING TO PERSIST WHILE STOCKHOLDERS SUFFER Non-accretive corporate costs have nearly doubled since 2015, and may spike ~20% in 2021 • Corporate costs have averaged approximately $22.4 $35 $32.0 million per year, with an upward trend since 2015 $30 $26.
Slide 31: Culture of Excess: CEO Commuting Expenses
A CULTURE OF EXCESS IS EVIDENCED BY THE BOARD AUTHORIZING ~$200,000 PER YEAR TO MR. WALTERS FOR COMMUTING EXPENSES We seriously question why the Board would hire a Chief Executive Officer – without financial sector experience – who lives 700+ miles away Mr. Walters lives a full plane ride away from
Slide 32: Expenses of Owning a Corporate Airplane
EXPENSES ADD UP QUICKLY WHEN YOU OWN A CORPORATE AIRPLANE As part of its purchase of HK Financial Services, the Company acquired a plane While we expect Blucora will try to make an excuse regarding this plane, flight records lead us to believe it is being consistently enjoyed by leadership… Source:
Slide 33: History of Overpaying for Poorly Structured Acquisitions
THE BOARD HAS A HISTORY OF OVERPAYING FOR POORLY STRUCTURED ACQUISITIONS This poorly-conceived acquisition strategy over-levered the Company’s balance sheet and depleted TaxAct’s Free Cash Flow $1,000 Blucora’s Debt-Fueled Acquisitions • Prior to Blucora’s HD Vest acquisition in 2015, the $900 Compa
Slide 34: Botched Acquisitions Have Yielded Serious Financial Consequences
BLUCORA’S BOTCHED ACQUISITIONS HAVE YIELDED SERIOUS FINANCIAL CONSEQUENCES FOR STOCKHOLDERS Based on the goodwill impairment charge recorded in 2020, it is clear that the Company overpaid for both HD Vest and 1st Global • The incumbent Board recorded a $271 million 2020 Goodwill Impairment on Blucor
Slide 35: Mismanagement of the Avantax Business
BLUCORA’S MISMANAGEMENT OF THE AVANTAX BUSINESS HAS HAD LARGE CONSEQUENCES An inability to integrate Avantax operationally or culturally has resulted in advisor attrition and chronic management turnover • We believe Blucora has failed to: x Sufficiently invest in organic growth and the resources tha
Slide 36: Alarming Exodus of Avantax Professionals
THERE HAS BEEN AN ALARMING EXODUS OF AVANTAX PROFESSIONALS Over the past four years, we believe Avantax lost at least 700 financial professionals • High-profile firms such as Reason Financial Group ($200 million Avantax Advisor Attrition 4,800 advisor), Schexnayder Wealth Advisors ($190 million advi
Slide 37: Avantax Advisor Attrition Attributable to Unreasonable Fees
AVANTAX ADVISOR ATTRITION IS LIKELY ATTRIBUTABLE TO UNREASONABLE FEES To protect the long-term value of Avantax and stem advisor departures, management should institute a moratorium on the $60 DTF fee • Avantax’s SMA business has a higher fee structure and is likely to create a direct conflict due t
Slide 38: Headlines: Avantax Advisors Are Fed Up
THE HEADLINES SPEAK FOR THEMSELVES: AVANTAX ADVISORS ARE FED UP Note: Emphasis added by Ancora. 38
Slide 39: Blucora's Misleading Attempt to Show Attentiveness
WE BELIEVE BLUCORA’S MISLEADING ATTEMPT TO SHOW ATTENTIVENESS TO AVANTAX PROFESSIONALS NOW IS DISINGENUOUS We believe stakeholders will see through Avantax’s feeble, reactionary stunt • A day after the release of our slate’s open letter to Avantax advisors, Blucora appears to have had Avantax shamel
Slide 40: Others Agree Leadership Changes Do Not Address Issues
OTHERS AGREE RECENT “LEADERSHIP CHANGES” DO NOT ADDRESS THE ISSUES PLAGUING AVANTAX The three individuals appointed by Avantax have actually been associated with the Company for some time “ [Leadership changes] don’t address the problems as far as decline of service, decline of communication with th
Slide 41: Blucora Has Also Mismanaged the TaxAct Business
BLUCORA HAS ALSO MISMANAGED THE TAXACT BUSINESS Despite management blaming pandemic headwinds, H&R Block and TurboTax both experienced an increase in U.S. DIY tax filers in 2019 and 2020 U.S. Do-It-Yourself Tax Filers +10.8% 40 increase 35.80 35 32.30 30 25 20 15 +8.0% increase -1.9% 8.69 10 8.05 de
Slide 42: Strong Case for a Credible Sales Process for TaxAct
THERE IS A STRONG CASE TO RUN A CREDIBLE SALES PROCESS FOR TAXACT A sale of the TaxAct business would allow Blucora to maximize the value of $250 million in NOLs that are set to expire soon $600 $450 $521.1 $519.7 $391.9 $504.0 $400 $500 $454.3 $350 $391.9 $400 $300 $249.2 $250 $300 $249.2 $200 $200
Slide 43: Apparent Dysfunction in Blucora's Boardroom
THERE IS APPARENT DYSFUNCTION IN BLUCORA’S BOARDROOM The incumbent Board has overseen serious governance issues, which we believe are preventing stockholders from realizing the true value of their investment POOR SUCCESSION PLAN LEADS TO UNJUSTIFIABLE DIRECTOR RASH CEO APPOINTMENT IN 2020 COMPENSATI
Slide 44: Boardroom Issue #1: Failed Strategy Under Underqualified CEO
BOARDROOM ISSUE #1: FAILED 6-YEAR-OLD CORPORATE STRATEGY UNDER CEO CHRIS WALTERS, WHO IS UNDERQUALIFIED The Board installed Chris Walters as its CEO in January 2020, despite his complete lack of wealth management experience Director Tenure TSR Chris Walters • We cannot comprehend why the Board would
Slide 45: Boardroom Issue #2: A Botched Refresh
BOARDROOM ISSUE #2: A BOTCHED REFRESH We believe the Board’s self-directed refresh has installed directors with irrelevant media experience rather than necessary financial services expertise • Despite adding a number of new directors in recent years, none have any substantive experience in wealth ma
Slide 46: Boardroom Issue #3: Insufficient Business Acumen
BOARDROOM ISSUE #3: INSUFFICIENT BUSINESS ACUMEN AND IRRELEVANT EXPERIENCE ACROSS THE BOARD Chris Walters Georganne Proctor Mary Zappone Steve Aldrich John MacIlwaine Director since 2014 Director since 2017 Director since 2015 Director since 2017 Director since 2018 x Irrelevant media experience x F
Slide 47: Boardroom Issue #4: Lack of Capital Allocation Discipline
BOARDROOM ISSUE #4: LACK OF CAPITAL ALLOCATION DISCIPLINE Blucora has a history of overpaying for acquisitions and brazenly spending its free cash flow • The Board – namely Chris Walters and Mary Zappone – supported an acquisition strategy in the wealth management/RIA space by acquiring HD Vest for
Slide 48: Boardroom Issue #5: Unjustifiable Director Compensation
BOARDROOM ISSUE #5: UNJUSTIFIABLE DIRECTOR COMPENSATION In 2020, eight directors received ~$2 million dollars in compensation – up 44% year-over-year Company Current Market Cap Total Board Compensation* Blucora ~$780 Million $2,031,160 Wealth Peers $866,196 Why are Blucora’s BrightSphere Investment
Slide 49: Boardroom Issue #6: Misaligned Executive Compensation
BOARDROOM ISSUE #6: MISALIGNED EXECUTIVE COMPENSATION Despite Mr. Walters’ questionable six-year track record in the boardroom and the Company’s comparatively small market capitalization, the Board decided to reward him like a proven, value-generating CEO in 2020 Stockholder Return Under Company Cur
Slide 50: Misaligned Executive Compensation (Cont.)
BOARDROOM ISSUE #6: MISALIGNED EXECUTIVE COMPENSATION (CONT.) When compared to Blucora’s previous CEO – who had significant wealth management experience – Mr. Walters has been grossly overpaid by the Board The Board awarded Mr. Walters… • A sign-on bonus of $250,000 for an INTERNAL promotion Non- du
Slide 51: Management Should Not Have Received Cash Bonuses
BOARDROOM ISSUE #6: MISALIGNED EXECUTIVE COMPENSATION (CONT.) We believe management should not have received any cash bonuses for 2020 given that it did not clear the 80% threshold • Blucora’s STI threshold level is 80%, which means the Company must hit 80% of the financial target to qualify $180 FY
Slide 52: Boardroom Issue #7: Efforts to Undermine Election Contest
BOARDROOM ISSUE #7: APPARENT EFFORTS TO UNDERMINE AN ELECTION CONTEST BASED ON THE MERITS In addition to spending a sizable seven-figure sum on efforts to fight Ancora, the Board has allowed the Company’s advisors to issue more than a dozen harassing letters The Company sent Mr. DiSanto a follow- Se
Slide 53: Boardroom Issue #7: Bylaw Amendments (Cont.)
BOARDROOM ISSUE #7: APPARENT EFFORTS TO UNDERMINE AN ELECTION CONTEST BASED ON THE MERITS (CONT.) The Company recently made a series of amendments to its bylaws that appear deliberately designed to disenfranchise and dissuade the Company’s owners from exercising their lawful rights as stockholders •
Slide 54: Our Solution: The Ancora Slate
OUR SOLUTION: THE ANCORA SLATE www.ABetterBlucora.com
Slide 55: Diverse Slate of Financial Services Experts
WE HAVE NOMINATED A DIVERSE SLATE OF FINANCIAL SERVICES EXPERTS Frederick D. DiSanto Cindy Schulze Flynn Robert D. MacKinlay Kimberly Smith Spacek • More than 30 years of experience • Approximately 20 years of • Approximately 20 years of experience • Approximately 20 years of financial in the financ
Slide 56: Our Slate Brings the Right Skills
OUR SLATE IS BRINGING THE RIGHT SKILLS FOR THIS PIVOTAL MOMENT IN TIME In contrast to the incumbents, we believe our slate has the right expertise to fuel a turnaround Prior Tax Sector Prior Wealth Sector Financial Services Prior Executive Prior Public Board Prior Transaction Strong Financing Experi
Slide 57: Debunking Attempt to Miscast Mr. DiSanto's Track Record
DEBUNKING BLUCORA’S ATTEMPT TO MISCAST MR. DISANTO’S TRACK RECORD The Company conveniently failed to include Mr. DiSanto’s directorships at public companies that have outperformed during his tenure Blucora’s Cherry-Picked TSR FACT: Mr. DiSanto’s Board tenure TSR is up 21% vs. S&P 500 PVF Capital PVF
Slide 58: Frederick D. DiSanto
FREDERICK D. DISANTO Frederick D. DiSanto, an expert in the wealth management with strong experience serving on public company boards of directors Mr. DiSanto has served as the Chairman and Chief Executive Officer of Ancora Holdings since January 2006 and December 2014, respectively. Mr. DiSanto als
Slide 59: Endorsements for Mr. DiSanto
ENDORSEMENTS FOR MR. DISANTO “ I have a high regard for Fred DiSanto and his partners at Ancora, who have a proven track record of maximizing “ As someone who has had the pleasure of serving on boards with Fred DiSanto over the years, I know firsthand what makes him such an effective director. Fred
Slide 60: Cindy Schulze Flynn
CINDY SCHULZE FLYNN Cindy Schulze Flynn, a financial services industry executive with deep experience in the areas of corporate communications, marketing and employee engagement She has been the Chief Marketing and Communications Officer of Union Home Mortgage, a privately held financial services fi
Slide 61: Endorsements for Ms. Flynn
ENDORSEMENTS FOR MS. FLYNN “ I have known Cindy for many years and over the past year have worked with her very closely at “ [Cindy’s] forward thinking around acquisitions, mergers and management Union Home Mortgage. [Cindy is] highly changes have been vital to the organizations analytical and inqui
Slide 62: Robert D. MacKinlay
ROBERT D. MACKINLAY Robert D. MacKinlay, a corporate finance leader and consultant with robust experience in the tax advisory industry Mr. MacKinlay has served as the Executive Vice President and Chief Financial Officer of Gardiner Service Company, Inc., a leading HVAC & building services company, s
Slide 63: Endorsements for Mr. MacKinlay
ENDORSEMENTS FOR MR. MACKINLAY “ Rob has deep technical and pragmatic knowledge in financial and tax accounting… His leadership experience made him very skilled in risk management, strategy, and accountability, and he has the finesse required to balance short-term objectives with long- “ term stabil
Slide 64: Kimberly Smith Spacek
KIMBERLY SMITH SPACEK Kimberly Smith Spacek, a financial services industry executive with deep experience in the areas of client engagement, investor relations and institutional and retail marketing Ms. Spacek is currently a Partner and the Director of Marketing and Investor Relations at Owl Creek A
Slide 65: Endorsements for Ms. Spacek
ENDORSEMENTS FOR MS. SPACEK “Kim has been my Partner at Owl Creek for over a decade, expertly leading and managing our marketing and investor relations functions... Kim has proven her ability to prioritize and “ maximize shareholder value for investors. “ Reuben Kopel, Managing Director, Eden Global
Slide 66: The Ancora Slate's Vision for a Better Blucora
THE ANCORA SLATE’S VISION FOR A BETTER BLUCORA www.ABetterBlucora.com
Slide 67: What Our Slate Stands For
WHAT OUR SLATE STANDS FOR The Ancora slate will bring a new mentality to the Board on Day 1 by encouraging collegial debate and thoughtful discussions about a new path forward. Our ideas include: Focus Blucora’s Attention and Create a Special Committee to Resources on Avantax Explore Alternatives fo
Slide 68: Priority #1: Refocus Resources on Avantax
PRIORITY #1: REFOCUS RESOURCES ON AVANTAX We believe the Board needs to consider steps that can lead to a stronger and more stable Avantax, including: • Eliminating the widely unpopular $60 direct-to-fund fee imposed on financial professionals, even if it reduces near-term revenues flowing up to Ava
Slide 69: Priority #2: Rebuild Credibility and Trust with Avantax Professionals
PRIORITY #2: REBUILD CREDIBILITY AND TRUST WITH AVANTAX PROFESSIONALS We believe the Board needs to immediately increase its efforts to stem attrition at Avantax, including by: • Introducing a new incentive fee model that is more in line with growth-oriented wealth management companies, which are in
Slide 70: Priority #3: Explore Alternatives for TaxAct
PRIORITY #3: EXPLORE ALTERNATIVES FOR TAXACT We would encourage the Board to establish a special committee to identify corporate efficiencies and explore alternatives for the TaxAct business: • Form committee comprised of independent directors with relevant experience assessing transactions and work
Slide 71: Priority #4: Refine Capital Allocation Framework
PRIORITY #4: REFINE THE COMPANY’S CAPITAL ALLOCATION FRAMEWORK We would encourage the Board to assess a new capital allocation framework that deprioritizes wasteful spending in favor of growth and debt reduction: • Reallocate a significant portion of Blucora’s nearly $180 million sales and marketing
Slide 72: Vote on the WHITE Proxy Card
THE TIME FOR CHANGE IS NOW VOTE ON THE WHITE PROXY CARD www.ABetterBlucora.com 72
Slide 73: Thank You
THANK YOU www.ABetterBlucora.com