Egan-Jones Leads the Market in Contested Situations

The best investors are often the best-informed investors.

For the most contested proxy proposals, investors require cogent, concise analysis with ample time to review. Egan-Jones is often first to publish recommendations on contested proxy proposals, and our fundamentals-focused approach frequently leads to different (and, in our opinion, better) recommendations for shareholders.

First to Publish in High-Profile Situations

Egan-Jones is often first among the major proxy advisors to publish recommendations on high-profile and contested situations, including:

We strive to provide recommendations early, so clients have ample time to understand our analysis, ask questions, and make informed decisions. Clients can also be confident that our recommendations are not influenced by the recommendations of other proxy advisors or conflicts of interests from advising corporate boards.

A Fundamentals-First Approach

Egan-Jones takes a unique approach to contested proposals as compared to other major proxy advisors. Rather than relying on a “check-the-box” policy framework, we focus on the root and proximate causes of a company’s challenges.

After analyzing shareholder returns relative to peers and the broader market, as well as the company’s financials, we aim to understand the following:

1. What is management’s vision?
2. How has management executed on that vision?
3. What has gone wrong at the company?
4. What is management doing to fix it?
5. What is the dissident’s vision?
   

We then evaluate which party we expect is more likely to generate greater returns for shareholders.

Example: In the Cracker Barrel withhold campaign, we focused on declining traffic and rising operating expenses as the fundamental issues. Management’s Strategic Transformation Plan, in place for more than a year, failed to improve these metrics. In fact, management has forecasted even weaker results for 2027. As a result, we recommended withholding votes from several directors responsible for the failed plan, including the CEO.

Different Approach, Different Results

Because our approach is grounded in fundamentals and company-specific analysis, our recommendations frequently diverge from those of other major proxy advisors:

1. Harley-Davidson: Egan-Jones recommended withholding from several directors due to the persistent underperformance of the Company. Another major proxy advisor recommended for all of management’s nominees.
2. National Health Investors: Egan-Jones recommended supporting management, in contrast to two other major proxy advisors, as there was compelling evidence that the current board was turning around the company. The dissidents, along with our peers, were focused on prior governance concerns that we did not believe were still impacting decision-making or company performance.
3. Brookdale Senior Living: Egan-Jones recommended supporting all six dissident nominees, whereas two other major proxy advisors recommended only two of the six. Given the company’s precarious debt position and ineffective strategy, we believed a substantial board overhaul was warranted.
4. Cracker Barrel: Egan-Jones was the only major proxy advisor to recommend withholding votes from the CEO, who oversaw the failed Strategic Transformation Plan implemented during her tenure.
   

Independent & Shareholder-First Advice

Egan-Jones is strictly focused on analysis and recommendations that maximize long-term returns for shareholders. This is especially true in contested situations, where we dig deeply into:

• The specific problems facing the company
• The competing visions of the nominees
• The strategy most likely to create value for shareholders

We do not consult with issuers, which helps ensure our independence and alignment with shareholder interests. Our reports are built from the ground up, without benchmarking to a “standard” policy.

Interested in learning more?

Schedule a meeting with us today to discuss how our independent, fundamentals-first approach can support your decision-making in contested and complex situations.