ARLINGTON, Va., May 19, 2016 /PRNewswire/ -- Arlington
Asset Investment Corp. (NYSE: AI) (the " Company" or
"Arlington" ) today announced that
it has filed and intends to mail a letter to shareholders in
connection with the Company' s 2016 Annual Meeting of Shareholders
to be held on June 9, 2016. This
letter and other materials regarding the Board of Directors'
recommendation for the 2016 Annual Meeting can be found on the
Company's website at www.arlingtonasset.com.
The full text of the letter is below:
VOTE "FOR" ALL OF THE ARLINGTON BOARD NOMINEES ON THE WHITE PROXY
CARD TODAY
May 19, 2016
Dear Fellow Arlington Shareholder:
ARLINGTON HAS A PROVEN TRACK
RECORD OF PAYING STRONG DIVIDENDS AND GENERATING POSITIVE
RETURNS TO SUPPORT THE DIVIDEND
Your Board and management team regularly review Arlington's business and strategies and are
dedicated to delivering value and generating significant
shareholder returns. In fact, our performance has enabled
Arlington to pay shareholders 25
consecutive quarterly dividends totaling $19.40 per share, reflecting the Board's
priorities for shareholders. Furthermore, in the first quarter of
2016, Arlington paid a dividend of
$0.625 per share. We urge you to
protect your Arlington dividend
and the value of your Arlington
investment by voting the enclosed WHITE proxy card today FOR all
eight of the highly qualified and experienced nominees to the
Arlington Board.
Unlike the nominees of Imation Corp. and the New York City-based hedge fund, Clinton Group,
Inc. (collectively, the "Imation Group"), Arlington's highly qualified director nominees
are aligned with shareholders and bring a deep understanding of and
experience in our industry that have allowed Arlington to provide consistent
results.
Meanwhile, Imation and its Board have paid NO dividends
despite the Clinton Group's promise during its proxy fight at
Imation last year to "evaluate the return of excess cash" to
Imation's shareholders. In fact, we believe that the Imation Group
intends to discontinue Arlington's
dividend if it is successful in its solicitation, falsely calling
it "unsustainable." Independent research analysts who follow
Arlington's business disagree with
the Imation Group, and instead believe that Arlington continues to deliver the performance
necessary to pay its robust dividend[i]:
"We are increasing our estimate of core (non-GAAP) EPS from
$2.95 to $3.13 based on trends in the
market and in Arlington's
portfolio, and we believe the dividend is sustainable at
$2.50 for 2016." (Wunderlich
Analyst Report, 5/11/16)
"We expect [Arlington] to
maintain its quarterly $0.625
dividend … we believe that the dividend is sustainable."
(Ladenburg Thalmann Analyst Report, 5/11/16)
ARLINGTON'S DIRECTOR
NOMINEES ARE HIGHLY QUALIFIED, EXPERIENCED AND
COMMITTED TO DRIVING LONG-TERM SHAREHOLDER VALUE
The Arlington's nominees on
the WHITE proxy card include proven professionals and leaders with
many decades of industry-related experience, including in real
estate, specialty finance, asset and investment management and
investment banking. Importantly, your Board collectively
owns more than 667,000 shares of Arlington stock[ii], which is
more than 60x the amount owned by the Imation Group. As significant
Arlington shareholders and as
fiduciaries, the first priority of your director nominees is the
protection of your investment and continued creation of shareholder
value.
WE BELIEVE THE IMATION GROUP'S SELF-SERVING AGENDA
WOULD PUT ARLINGTON'S DIVIDEND AND
CAPITAL AT SIGNIFICANT RISK
Since the Clinton Group won its proxy contest at Imation last
year, Imation's stock has lost approximately 65% of its
value. This poor performance has been documented in the news, and
according to one independent commentator1:
"That is value destruction on a colossal scale. In
August last year, when the Clinton Group got control of [Imation],
[the share price] was between $3.00 and
$4.00. Good job guys; the other investors won't think much
of what you have done since then, if the share price is any
judge." (Chris Mellor, The
Register, 5/11/16)
This disastrous trend at Imation under the Clinton Group
continues. In its recent first quarter earnings, Imation posted a
net loss of $91.1 million, compared
to a loss of $14.4 million in 2015 –
representing a more than 500% deterioration of Imation's
results year over year – and yet Imation's interim CEO declared
the quarter successful! Just last week, Imation's independent
auditor declined to stand for re-election, for no disclosed
reason – a fact that we think speaks for itself.
Meanwhile, as Imation investors have lost value in their stock
and received no dividends, in only eight months, the Imation Board,
comprised solely of the Clinton Group nominees and directors chosen
and elected by the Clinton Group nominees, has approved
self-dealing transactions with the Clinton Group and other board
members involving more than $50
million.[iii] This includes a $35
million investment in the Clinton Group hedge funds with
off-market high performance fees for the Clinton Group. It also
includes paying more than $5.1
million to a firm founded and led by Barry Kasoff, an Imation director and one of the
Imation Group's nominees to the Arlington Board. The payment to Mr. Kasoff
and his consulting firm for eight months of work exceeded the
combined compensation of Arlington's CEO and CFO for the entire year –
and, collectively, these deals represent more than 80% of the
market capitalization of Imation today!
The Imation Group became shareholders in Arlington approximately one week prior to
launching its attempt to take over Arlington. Since then,
the Imation Group has disclosed plans for Arlington that are frighteningly similar to
its self-serving and value destroying agenda at
Imation, including:
- Taking control of Arlington's
Board, management and capital;
- Terminating management; and
- Hinting that it will turn Arlington into an externally managed hedge
fund business, probably by Imation itself and/or the Clinton
Group.
Imation's value destructive propositions for Arlington recently caught the attention of an
independent research analyst1:
"We think such external management would not align the
interests of the external manager with those of shareholders, and
could approximately double AI's operating expenses. … We do take
issue with activism when we think the proponent is seeking to
unseat the incumbent [board] and advantage itself at the expense of
shareholders." (Wunderlich Analyst Report, 5/11/16)
PROTECT YOUR ARLINGTON
DIVIDEND—VOTE THE WHITE PROXY CARD TODAY
We urge shareholders to avoid the excessive risk posed by the
Imation Group. Vote FOR all of your Board's experienced and
highly qualified director nominees by telephone, over the internet,
or by signing, dating and returning the enclosed WHITE proxy card
today.
On behalf of your Board of Directors and management team, we
thank you for your continued support.
Sincerely,
The Arlington Board of
Directors
Eric F.
Billings
|
J. Rock Tonkel,
Jr.
|
Daniel J.
Altobello
|
Daniel E.
Berce
|
|
|
|
|
David W.
Faeder
|
Peter A.
Gallagher
|
Ralph S. Michael,
III
|
Anthony P. Nader,
III
|
Your Vote Is
Important, No Matter How Many or How Few Shares You
Own
If you have any
questions or need assistance voting, please contact the firm
assisting Arlington in the solicitation of proxies:
INNISFREE M&A
INCORPORATED
Shareholders may
call toll free: 1-888-750-5834
Banks and Brokers
may call collect: 212-750-5833
IMPORTANT
We urge you NOT to
sign any gold proxy card sent to you by the Imation
Group.
If you have already
done so, you have every legal right to change your vote by using
the enclosed WHITE proxy card to vote TODAY—by telephone, via
Internet, or by signing, dating and returning the WHITE proxy card
in the postage paid envelope provided.
|
About Arlington Asset Investment Corp.
Arlington Asset Investment Corp. (NYSE: AI) is a principal
investment firm that currently invests primarily in
mortgage-related and other assets. The Company is headquartered in
the Washington, D.C. metropolitan
area. For more information, please visit
www.arlingtonasset.com.
Important Additional Information
The Company, its directors and certain of its executive officers
are participants in the solicitation of proxies in connection with
the Company's 2016 Annual Meeting of Shareholders. The Company has
filed a definitive proxy statement and form of WHITE proxy card
with the U.S. Securities and Exchange Commission (the "SEC") in
connection with such solicitation of proxies from the Company's
shareholders. WE URGE INVESTORS TO READ THE DEFINITIVE
PROXY STATEMENT (INCLUDING ANY AMENDMENTS AND SUPPLEMENTS THERETO)
AND ACCOMPANYING WHITE PROXY CARD CAREFULLY AND IN THEIR ENTIRETY
BECAUSE THEY CONTAIN IMPORTANT INFORMATION.
Information regarding the names of the Company's directors and
executive officers and their respective interests in the Company by
security holdings or otherwise as of April
7, 2016, is set forth in the Company's definitive proxy
statement for its 2016 Annual Meeting of Shareholders, filed with
the SEC on April 18, 2016. Additional
information can be found in the Company's Annual Report on Form
10-K for the year ended December 31,
2015, filed with the SEC on February
16, 2016. These documents are available free of charge at
the SEC's website at www.sec.gov. Shareholders are able to obtain,
free of charge, copies of these documents, including any proxy
statement (and amendments or supplements thereto) and accompanying
WHITE proxy card, and other documents filed with the SEC at the
SEC's website at www.sec.gov. In addition, copies are also
available at no charge at the Investors section of the Company's
website at http://www.arlingtonasset.com/.
SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION
REFORM ACT OF 1995
Certain statements in this news release that are not historical
facts are forward-looking statements. Forward-looking statements
involve various important assumptions, risks and uncertainties.
Actual results may differ materially from those predicted by the
forward-looking statements because of various factors and possible
events. We discuss these factors and events, along with certain
other risks, uncertainties and assumptions, under the heading "Risk
Factors" in our Annual Report on Form 10-K for the year ended
December 31, 2015, and in our other
filings with the SEC. We note these factors for investors as
contemplated by the Private Securities Litigation Reform Act of
1995. Predicting or identifying all such risk factors is
impossible. Consequently, investors should not consider any such
list to be a complete set of all potential risks and uncertainties.
Forward-looking statements speak only as of the date on which they
are made, and we undertake no obligation to update any
forward-looking statement to reflect circumstances or events that
occur after the date of the statement to reflect unanticipated
events. All subsequent written and oral forward-looking statements
attributable to us or any person acting on behalf of the Company
are qualified by the cautionary statements in this section.
[i] Permission to use quotations neither sought nor
obtained.
[ii] Includes vested restricted stock units and restricted
stock.
[iii] Imation SEC filings.
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SOURCE Arlington Asset Investment Corp.