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Privet Fund LP Delivers Letter To Independent Directors Of J. Alexander's Commenting On Alternative Proposals

By continually conferring "favored party" status on Fidelity when they have yet to offer superior economic value to shareholders at any stage of this process, we believe that the Board is hindering the competition among the bidders at a time when competition should be encouraged.  We have seen no evidence to support the termination of the "excluded party" designation from Parties F and G and, had that designation remained in effect we believe that both parties would have had the ability to offer an incremental $0.18 per share to shareholders[4].  We can conceive of no reason why the Board was willing to transfer $0.18 per share of value from shareholders to Fidelity.

We find it troubling that the process continues to be led by the same individuals and advisors who, less than two months ago, counseled you to accept a cash and stock deal estimated to be somewhere close to $12 per share.  They then encouraged you to terminate discussions with all suitors, thereby doubling the break-up fee payable to Fidelity, because the price of the Fidelity transaction was " advisable, fair to, and in the best interest of the Company and its shareholders"[5].  Should certain members of the Board or its advisors believe that there is any credible rationale for obstructing the competitive process and/or delivering to shareholders any less than the maximum consideration that a robust auction would yield, we remain committed to closely scrutinizing such justification.    In light of the conflicting interests involved, shareholders deserve to assess all of the facts for themselves prior to tendering their shares into an offer.  We believe that they will not accept purported "financing contingencies", "post-close solvency issues" or similarly vague and insincere excuses that would require them to involuntarily relinquish their company below a market-clearing price.

Do not enter into an agreement to sell this Company until you can conclusively show that the acquiring party is proposing greater economic consideration than any other party would be willing to offer.

Revlon dictates that you obtain the highest price from a qualified bidder rather than an acceptable price from a preferred bidder.  We believe that terminating discussions with "excluded parties" was clearly a mistake that cost shareholders.  Now that you have been given another opportunity to negotiate a transaction, we urge you to not be influenced by past errors.  Take control of the process.  Do not rely on representatives and advisors who we believe to be burdened with conflicts[6]. 

Though the current auction may be accidental, there is no reason that it cannot be successful.

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