Rent-A-Center, Inc. Highlights Inexperience of Engaged Capital Nominees
A Vote for
Urges Stockholders to Protect Their Investment by Voting “FOR” Each of Rent-A-Center’s Highly Qualified Director Nominees on the WHITE Proxy Card
The Rent-A-Center Board unanimously recommends stockholders vote the WHITE
proxy card “FOR” the Company’s
highly-qualified and experienced director nominees:
Rent-A-Center’s letter to stockholders and other materials regarding the Board's recommendation for the 2017 Annual Meeting of Stockholders can be found at http://investor.rentacenter.com.
The full text of the letter is below:
Dear Rent-A-Center Stockholder,
As our 2017 Annual Meeting of Stockholders approaches on
Currently, you are represented by a Board of Directors that is
experienced and committed to acting in the best interests of ALL
In contrast, Engaged Capital’s nominees lack both the experience and
expertise needed to lead
We urge you to protect your investment in
ENGAGED CAPITAL’S DIRECTOR NOMINEES DO NOT BRING INCREMENTAL
EXPERTISE
OR EXPERIENCE TO THE RENT-A-CENTER BOARD
In stark contrast to Rent-A-Center’s three highly-qualified and
experienced nominees, Engaged Capital’s nominees lack the necessary and
relevant experience to shape the Company’s strategy. Engaged Capital’s
nominees add no incremental skills to the current Board and generally
lack the management and retailing experience required to best serve
| Candidate | Red Flags | |
| Jeffrey J. Brown Current position: Chief Executive Officer and Founding Member of Brown Equity Partners |
• No retail operating experience • As a Director, oversaw RCS Capital Corp. during the two years leading into the company’s filing for Chapter 11 bankruptcy in 2016 • Also oversaw RCS Capital Corp. during its settlement with the Massachusetts Secretary of the Commonwealth, Securities Division in 2015 - Realty Capital Securities, a subsidiary of RCS Capital Corp., was charged with fraudulently casting stockholder proxy votes - Realty Capital Securities paid a $3 million fine and voluntarily withdrew its broker-dealer licenses in Massachusetts and all other state and federal jurisdictions |
|
| Mitchell E. Fadel Current position: Unemployed |
• As former President and COO of Rent-A-Center, spearheaded several implementation and operational missteps - Smartphone rollout / purchasing mismanagement - Inventory misalignment toward “Good” vs. “Better / Best” products - Overly-promotional pricing cadence - Loosened account management standards and customer contact policies - Initial in-store labor model changes that negatively impacted customer service and co-worker stability - ANow 90-day “same-as-cash” rollout resulted in a material reduction in operating margins - Expansion of ANow into less productive retail partners and segments • Adds no incremental expertise to Rent-A-Center’s existing Board • Was requested to resign from the Rent-A-Center Board |
|
|
Christopher B. Hetrick
Current position: Director of Research at Engaged Capital |
• No public company management experience • No public company board experience • No retail or operating experience • Directly beholden to Engaged Capital as his principal employer |
We believe the election of Engaged Capital’s nominees would limit the
value creation opportunity for all
THE BOARD UNANIMOUSLY RECOMMENDS STOCKHOLDERS SUPPORT RENT-A-CENTER
ON ITS PATH
TO GROWTH AND PROFITABILITY AND VOTE “FOR” ITS
THREE HIGHLY-QUALIFIED NOMINEES
Engaged Capital’s nominees do not compare to our compelling slate.
Rent-A-Center’s three directors up for re-election at the 2017 Annual
Meeting –
As a founder of the Company, Mr. Speese brings to the Board leadership,
unparalleled knowledge of the
Mr. Jackson adds comprehensive involvement in emerging technological trends, including those in data analytics and mobile marketing and distribution, as well as in enterprise software in SaaS products and large technological transformations. Mr. Jackson also brings deep financial expertise, including his prior experience as Chief Financial Officer of Sabre and his service as chairman of our Audit & Risk Management Committee. Mr. Roberts’ experience as a Chief Executive Officer of several multi-unit retail companies brings directly relevant experience and a unique perspective in retail marketing to our Board, as well as significant financial expertise. Mr. Roberts serves as the chairman of our Compensation Committee, which received the best possible score from Institutional Shareholder Services for aligning executive compensation policies with the long-term interests of shareholders.
With their collective knowledge of the business and retail industry,
comprehensive operational and strategically-oriented experience, and
extensive CEO and governance experience, we believe Rent-A-Center’s
Board nominees are well-positioned and qualified to drive a turnaround
of the business and deliver long-term value. Together with the full
Board, these directors have taken decisive actions to drive growth,
improve profitability and maximize value for ALL
RENT-A-CENTER’S BOARD AND MANAGEMENT REPRESENT THE BEST PATH FORWARD
TO
DRIVE VALUE FOR ALL STOCKHOLDERS
The comprehensive strategic plan outlined by Rent-A-Center’s Board and management team represents a compelling long-term value creation opportunity for ALL stockholders. The Board and management team are confident that the Company’s slate of nominees is better qualified to lead the strategic direction and execute on the strategic plan than Engaged Capital’s nominees.
Your Board unanimously recommends that stockholders vote “FOR”
Rent-A-Center’s three highly-qualified candidates –
We urge you to protect the value of your investment and disregard
Engaged Capital’s self-serving campaign by simply discarding any Blue
proxy card that you may receive from
Thank you for your continued support.
The Rent-A-Center Board of Directors:
|
Mark E. Speese |
Michael J. Gade |
Jeffery M. Jackson |
||||
|
J.V. Lentell |
Steven L. Pepper |
Leonard H. Roberts |
Rishi Garg |
|||
|
If you have any questions, or need assistance voting |
|
OKAPI |
|
PARTNERS |
| 1212 Avenue of the Americas, 24th Floor |
| New York, New York 10036 |
| Telephone: (212) 297-0720 |
| Toll-Free: (877) 259-6290 |
|
Email: Info@okapipartners.com |
About
A rent-to-own industry leader,
Forward-Looking Statements
This press release and the guidance above contain forward-looking
statements that involve risks and uncertainties. Such forward-looking
statements generally can be identified by the use of forward-looking
terminology such as "may," "will," "expect," "intend," "could,"
"estimate," "should," "anticipate," "believe," or “confident,” or the
negative thereof or variations thereon or similar terminology. The
Company believes that the expectations reflected in such forward-looking
statements are accurate. However, there can be no assurance that such
expectations will occur. The Company's actual future performance could
differ materially from such statements. Factors that could cause or
contribute to such differences include, but are not limited to: the
general strength of the economy and other economic conditions affecting
consumer preferences and spending; factors affecting the disposable
income available to the Company's current and potential customers;
changes in the unemployment rate; difficulties encountered in improving
the financial and operational performance of the Company's business
segments; the Company’s chief executive officer and chief financial
officer transitions, including the Company’s ability to effectively
operate and execute its strategies during the interim period and
difficulties or delays in identifying and/or attracting a permanent
chief financial officer with the required level of experience and
expertise; failure to manage the Company's store labor and other store
expenses; the Company’s ability to develop and successfully execute
strategic initiatives; disruptions, including capacity-related outages,
caused by the implementation and operation of the Company's new store
information management system, and its transition to more-readily
scalable, “cloud-based” solutions; the Company's ability to develop and
successfully implement digital or E-commerce capabilities, including
mobile applications; disruptions in the Company's supply chain;
limitations of, or disruptions in, the Company's distribution network;
rapid inflation or deflation in the prices of the Company's products;
the Company's ability to execute and the effectiveness of a store
consolidation, including the Company's ability to retain the revenue
from customer accounts merged into another store location as a result of
a store consolidation; the Company's available cash flow; the Company's
ability to identify and successfully market products and services that
appeal to its customer demographic; consumer preferences and perceptions
of the Company's brand; uncertainties regarding the ability to open new
locations; the Company's ability to acquire additional stores or
customer accounts on favorable terms; the Company's ability to control
costs and increase profitability; the Company's ability to retain the
revenue associated with acquired customer accounts and enhance the
performance of acquired stores; the Company's ability to enter into new
and collect on its rental or lease purchase agreements; the passage of
legislation adversely affecting the Rent-to-Own industry; the Company's
compliance with applicable statutes or regulations governing its
transactions; changes in interest rates; adverse changes in the economic
conditions of the industries, countries or markets that the Company
serves; information technology and data security costs; the impact of
any breaches in data security or other disturbances to the Company's
information technology and other networks and the Company's ability to
protect the integrity and security of individually identifiable data of
its customers and employees; changes in the Company's stock price, the
number of shares of common stock that it may or may not repurchase, and
future dividends, if any; changes in estimates relating to
self-insurance liabilities and income tax and litigation reserves;
changes in the Company's effective tax rate; fluctuations in foreign
currency exchange rates; the Company's ability to maintain an effective
system of internal controls; the resolution of the Company's litigation;
and the other risks detailed from time to time in the Company's
Additional Information and Where to Find It
The Company, its directors, executive officers and other employees may
be deemed to be participants in the solicitation of proxies from the
Company’s stockholders in connection with the matters to be considered
at Rent-A-Center’s 2017 Annual Meeting. On
View source version on businesswire.com: http://www.businesswire.com/news/home/20170515005789/en/
Source:
Investors:
Rent-A-Center, Inc.
Maureen Short
Interim
Chief Financial Officer
972-801-1899
maureen.short@rentacenter.com
and
Okapi
Partners LLC
Bruce H. Goldfarb / Chuck Garske / Teresa Huang
212-297-0720
or
Media:
Joele
Frank, Wilkinson Brimmer Katcher
Kelly Sullivan / James Golden /
Aura Reinhard
212-355-4449