Affected Rocky Mountain Shareholders File Definitive Proxy Statement for Rocky Mountain Chocolate Factory 2021 Annual Meeting

Exposes the half-truths contained in the company’s proxy materials ensuring that shareholders have the right information to inform their voting decisions

Encourages Shareholders to Learn the Facts, Ignore the Fictions, and Vote the BLUE Card to Elect Affected Shareholders of Rocky Mountain Director Nominees

WESTFIELD, New Jersey, September 13, 2021–(BUSINESS WIRE)–AB Value Management LLC, collectively with its affiliates (“AB Value”) and the other participants in this solicitation (collectively, the “Affected Rocky Mountain Shareholders”) representing approximately 14.63% of the outstanding shares of Rocky Mountain Chocolate Factory, Inc. (NASDAQ: RMCF) (the “Company”) today filed its definitive proxy statement with the United States Securities and Exchange Commission (the “SEC”) to solicit proxies for the election of its five highly qualified and independent nominee directors—Andrew T. Berger, Mary Kennedy Thompson, Mark Riegel, Sandra Elizabeth Taylor and Rhonda J. Parish—at the 2021 annual meeting of shareholders of the Company (the “2021 Annual Meeting”).

“We are proposing director nominations because while we believe the company has tremendous potential, it has been beset by disorderly and reactive leadership and governance. This responsiveness has only been amplified in the final months leading up to the 2021 Annual Meeting,” commented Andrew Berger, Managing Member of AB Value.

Affected Rocky Mountain shareholders believe that the company’s proxy materials perpetuate a series of false and misleading statements about the company’s actions and engagement with affected Rocky Mountain shareholders. Below are some of the most egregious fictions contained in the company’s filings and how these misrepresentations can be countered with facts that show the company is manipulating the truth to its advantage:

CORPORATE FICTION #1: The Company’s Board of Directors (the “Board”) has successfully implemented an ongoing refreshment program over the past few years.

MADE: The Council took defensive and reactionary measures after our public intervention. The first time the Company publicly mentioned “Board Renewal” was on July 22, 2021, less than a month after AB Value submitted its notice of appointment. The Company also fails to mention that Board turnover was not driven by a deliberate long-term Company plan, but by continued shareholder unrest:

  • Tariq Farid—joined the board in January 2020 as part of a strategic alliance with Edible Arrangements, LLC;

  • Andrew Berger and Mary Kennedy Thompson — appointed to the board by the company pursuant to a settlement agreement in December 2019; and

  • Jeffrey R. Geygan – appointed in August 2021 to the board in an effort to settle a proxy contest led by affiliates of Mr. Geygan.

CORPORATE FICTION #2: The Board has engaged in substantial dialogue in good faith with AB Value.

MADE: AB Value and the company had an almost fully negotiated settlement agreement with a one-year standstill clause that was accepted in principle by the company’s general counsel, who communicated that the agreement was also approved by the CEO, only to be deemed unacceptable. by a contingency of the Board and waived by the Company. The company’s next “undertaking” with AB Value over a potential settlement, more than six weeks later, included a four-year standstill clause that would keep directors in place for several years and the board’s refusal to change its composition. in connection with any settlement with AB Value (despite its willingness to do so in the settlement with Global Value Investment Corp. (“Global Value”), which had recently launched a tender offer for the shares of the Company). By refusing to put Mr. Berger on its list, the Society is trying to remove the director who championed the very governance improvements the Society later implemented (and glorified in a public relations campaign).

CORPORATE FICTION #3: The Company is committed to adopting world-class governance.

MADE: The Council makes the daily decision to retain a a decade poison pill, passed without shareholder approval, was scheduled to expire in March 2025. Mewawalla, didn’t even have the guts to include our proposal on his proxy card for shareholders to consider at the 2021 annual meeting.

CORPORATE FICTION #4: The Company’s nominees, six of whom are independent, constitute the right Board of Directors with the depth and breadth of qualifications needed to drive the Company’s growth strategy.

MADE: With the exception of the council, none of Mr Mewawalla, Gabriel Arreaga or Brett Seabert has ever served on a public council. Mr. Mewawalla also lacks C-level experience in a public company and experience in the catering industry. Similarly, neither Mr. Seabert nor Mr. Geygan had experience in the confectionery industry prior to joining the Commission.

The facts also justify the questioning of the capacity of MM. Seabert and Geygan to exercise independent judgment. Mr Geygan and Global Value recently attempted a takeover bid for a controlling stake in the company, threatened to replace a near majority of the board and made multiple indications of their desire to take control of the society.1 Mr. Seabert, on the other hand, shares a close and intimate bond with the company’s CEO, Mr. Seabert may have found a better man in Mr. Merryman, but that doesn’t make Mr. Seabert the best man. advice.2

CORPORATE FICTION #5: The special committee’s mission is to oversee the process of identifying new qualified and independent directors.

MADE: The company’s own attorney has confirmed that the special committee was formed in response to and to address the proxy contest at the 2021 annual meeting. Special Committee remove any doubt as to the true purpose and scope of the Committee.

CORPORATE FICTION #6: AB Value’s candidates (with the exception of Ms. Thompson) do not have the experience, skills or expertise required to drive the company’s strategy.

MADE: As the largest group of shareholders in the company, Rocky Mountain’s affected shareholders are aligned to act in the best interests of all shareholders. The majority of our candidates have served in public companies and bring a wide range of experiences: corporate social responsibility, restaurant and confectionery industry expertise, sophisticated financial analysis and judgement, and a track record of success including the board desperately needs to improve shareholder value. Indeed, the Company has conveniently changed its mind about Mr. Berger since it issued its 2020 and 2019 proxy statements, in which it told shareholders that “[the Company] believe[s] that Mr. Berger’s experience in investment management, more specifically his experience in the food industry and franchising, qualifies him to serve as a director of the Company. »

It’s clear to concerned Rocky Mountain shareholders that his campaign has inspired reactionary, albeit random, change within the company, but there’s still work to be done. If elected, our nominees will bring to the board a heightened view of shareholders, a view of shareholders that is untainted by a historically demonstrated desire to seek personal rewards at the expense of all other shareholders. Rocky Mountain’s Affected Shareholder nominees are committed to ensuring greater accountability and decisions made in the best interests of shareholders. Concerned Rocky Mountain shareholders encourage shareholders to arm themselves with all the facts and take the company’s fictions for what they are: attempts to salvage the seats of some incumbent directors. We are confident that shareholders armed with the facts will vote for the BLUE card for new honest leadership in business.

1 These indications include two implied attempts of oral conversations between GVIC and representatives of the company approximately five and ten years ago (both of which were recently confirmed by Mr. Geygan to AB Value) and a written offer made on June 8, 2021 , as disclosed in the company’s definitive proxy statement filed with the SEC on September 9, 2021.

2 Mr. Merryman was Mr. Seabert’s best man at his wedding. The Reno Gazette-Journal wedding announcement can be found here:

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John Glenn Grau
InvestorCom LLC
(203) 295-7841

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