Undervalued Premium Assets

• Companies with strong, defensible franchises
• Current market value well below intrinsic value (>30% PV)
• Identifiable reasons for value gap
• Multiple paths for value creation
• Self-inflicted missteps by management and board create the value opportunity, not the market

Small – Mid Cap Focus

• $500M – $8B market cap offers highest returns and persistent opportunity set
• Most activist funds too large to invest there
• Under-covered by Wall Street research
• Engaged Capital’s deep research expertise maximizes opportunities
• Our Wall Street connections help initiate coverage

Information Advantage

• Universe of 1,400+ companies; typically only need to source 2-3 new core positions annually
• Stronger conviction leads to larger investment
• Uncorrelated returns; we manufacture our returns
• Typically the most knowledgeable shareholder and board member

Private Equity Style In Public Companies

• Engaged Capital becomes the catalyst for change
• Invest for influence not control
• Do not have to pay a control premium
• High impact dialogue with management/Board
• Focus on portfolio companies’ long-term interests (hold 2-5 years)