ISS Recommends Rocky Mountain Chocolate Factory Stockholders Vote FOR AB Value-Radoff Group’s Nominee on the BLUE Proxy Card
2022年8月8日 - 9:00PM
ビジネスワイヤ(英語)
Leading Independent Proxy Advisory Firm
Supports the Addition of Either AB Value-Radoff Group’s Nominee or
its Proposed Mutually Agreed Upon Director Candidate
Report Notes “Change is Preferable to the
Status Quo”
Report Also Notes “the Chairman and Those
Board Members That Voted with Him Have Chosen to Risk Reputational
Damage for the Possibility of Retaining Control”
AB Value Management LLC and Bradley L. Radoff (together with
their affiliates, the "AB Value-Radoff Group" or "we"), who own
approximately 17.6% of the outstanding shares of Rocky Mountain
Chocolate Factory, Inc. (NASDAQ: RMCF) ("Rocky Mountain" or the
"Company"), today announced that Institutional Shareholder Services
Inc. (“ISS”), a leading independent proxy advisory firm, has
recommended the Company’s stockholders vote on the BLUE proxy card to elect the AB Value-Radoff
Group’s independent nominee.
In its full report, ISS affirmed the case for additional
boardroom change at Rocky Mountain and agreed with the AB
Value-Radoff Group’s concerns regarding the incumbent Board’s
recent behavior:1
- “In the absence of a cooperative resolution, support for
Bradley on the dissident (BLUE) card is the next best option, as
she brings additive skills and independence […]”
- “In proposing a settlement with customary conditions, and then
weaponizing those conditions to retract its own proposal, the
chairman and those board members that voted with him have chosen to
risk reputational damage for the possibility of retaining control
of the company.”
- “The board's backhanded endorsement of the dissident's
recommendation that it add a female director with franchising
experience, along with the fact that the company still has some way
to go to overcome the operational issues that led to last year's
contest, underscore that change is preferable to the status
quo.”
- “In choosing to expand the board and appoint a seventh board
member after the meeting, the board is depriving shareholders of
the opportunity to vote on a director's candidacy in a contested
election.”
- “[…] in light of their substantial shared history and the
personal nature of the contest, there is a reasonable basis for the
dissident's concerns regarding the chairman and the CEO's close
ties.”
- “[…] ten months after the change in the company's leadership,
it remains unclear how the new board and management will extricate
the company from its continuing slide in adjusted EBITDA, margins,
and store count.”
ISS also urged Rocky Mountain to follow through on its
commitment to reaching a good faith settlement and acknowledged the
relevant qualifications possessed by our proposed alternative
director:
- “A negotiated settlement with a multi-year standstill agreement
to prevent another proxy contest would have been the most
beneficial outcome for unaffiliated shareholders.”
- “Given the slim daylight between the dissident and the
company's respective positions and the public nature of their
negotiations (the company announced the terms of its settlement
offer in a press release, the dissident issued its own press
release to announce its acceptance of the terms), a settlement
should have been attainable.”
- "Although ISS did not have the opportunity to engage with the
dissident's alternative recommendation […] we note that she serves
on the board of a public company with franchisees and has worked as
general counsel and corporate secretary at three other major
companies with substantial franchise operations – experience that
is relevant to the issues facing RMCF.”
The AB Value-Radoff Group commented:
“We are pleased that ISS has recognized the need for change in
Rocky Mountain’s boardroom following continued financial
underperformance and abysmal corporate governance. Rocky Mountain
continues to be held back by an underqualified Board that lacks
adequate diversity and sufficient regard for acceptable corporate
governance practices. As Rocky Mountain now embarks on a
turnaround, we believe it is the right time to add a new female
director with fresh perspectives and relevant experience in
corporate leadership, franchising and the broader food sector. We
cannot see how stockholders are well-served by re-electing Brett
Seabert, who lacks relevant experience, has overseen significant
value destruction and possesses interlocks to the prior failed
Chief Executive Officer.
We strongly believe the best path to preserving and maximizing
stockholder value at Rocky Mountain is by adding one of our
proposed candidates to the Board. As we have publicly reiterated
already, we remain willing to work with the Board to reach a good
faith settlement despite its recent unprofessional behavior.”
VOTE THE BLUE
PROXY CARD TODAY!
___________________________ 1 Permission to quote ISS was
neither sought nor obtained.
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version on businesswire.com: https://www.businesswire.com/news/home/20220808005244/en/
Saratoga Proxy Consulting John Ferguson / Joe Mills,
212-257-1311 info@saratogaproxy.com
Longacre Square Partners Bela Kirpalani, 646-386-0091
bkirpalani@longacresquare.com
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