Activist Attractiveness Score (AAS)

Research evidence excerpt

Activist Attractiveness Score (AAS)

JuneJune17,17,20262026

Activist Attractiveness Score: The UNLOCK Framework

In the exhibit below, we outline the 10 metrics used to derive our Activist Attractiveness Score (AAS). The AAS is

designed to quantify activist attractiveness across the fundamental drivers we believe are most relevant to activist

engagement, including shareholder Underperformance, Non-optimal capital allocation, Leadership and governance

gaps, Operational inefficiencies, Capital structure misalignment, and Katalyst Potential. Each metric is scored on a

sliding scale using predefined thresholds, enabling a systematic ranking of companies and a corresponding

percentile-based measure of activist attractiveness.

Activist Attractiveness Score (AAS) Metrics Methodology

10 Metric Activist Attractiveness Score Weighting Description

Measures the company’s near-term stock performance versus its sector, capturing recent value destruction or

LTM Sector Rel. Return

8% loss of investor confidence. Persistent short-term underperformance can signal execution issues or strategic

(↓ ratio = ↑ attractiveness)

issues attractive to activists.

Measures long-term shareholder underperformance versus sector peers and the SPXEKW, a common catalyst for

5 Yr. Sector/SPXEKW Rel. Return activist involvement. Multi-year underperformance strengthens the case that issues are structural rather than

25%

(↓ ratio = ↑ attractiveness) cyclical. Our research and conversations with activists found 5-Yr sector underperformance is the primary metric

for activist engagements. Note, We use the minimum of either the 5-Yr sector or SPXEKW underperformance.

Change in Ind. Rel. EV / EBITDA vs. 5 Yrs

Captures EV / EBITDA valuation multiple compression relative to peers over time. Meaningful de-rating often