UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934
(Amendment No.   )
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Filed by a Party other than the Registrant  ☒
  
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Preliminary Proxy Statement
  
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Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
  
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Definitive Proxy Statement
  
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Definitive Additional Materials
  
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Soliciting Material Pursuant to §240.14a-12
  
   
MEDALLION FINANCIAL CORP.
(Name of Registrant as Specified In Its Charter)
 
ZimCal Asset Management, LLC
BIMIZCI Fund, LLC
Warnke Investments LLC
Stephen Hodges
Judd Deppisch
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

-with copies to-
  
 
Peter D. Fetzer
Foley & Lardner LLP
777 East Wisconsin Avenue
Suite 3800
Milwaukee, WI  53202-5306
(414) 297-5596
 
      
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ZimCal Asset Management, LLC

ZimCal Asset Management, LLC, Stephen Hodges, BIMIZCI Fund, LLC and Warnke Investments LLC (collectively, “ZimCal”) have filed a preliminary proxy statement with the Securities and Exchange Commission (the “SEC”) and launched a website, www.restoretheshine.com, to communicate with the stockholders of Medallion Financial Corp. (the “Company”) in connection with the Company’s 2024 annual meeting of stockholders.  Screenshots of the website are attached hereto as Exhibit 1, the disclaimer for the website is attached hereto as Exhibit 2, and the letter to the Company dated October 11, 2023 that is on the website is attached hereto as Exhibit 3.
Important Information
These materials are not a solicitation of a proxy from any security holder of Medallion Financial Corp.  Stephen Hodges and his affiliates, ZimCal Asset Management, LLC, BIMIZCI Fund, LLC and Warnke Investments LLC (collectively, “ZimCal”), have nominated individuals as nominees to the Company’s board of directors and intend to solicit votes for the election of those individuals, Stephen Hodges and Judd Deppisch, as members of the Company’s board of directors (the “Nominees”).  ZimCal will send a definitive proxy statement, proxy card and related proxy materials to shareholders of the Company seeking their support of the Nominees at the Company’s 2024 annual meeting of stockholders.  Stockholders are urged to read the definitive proxy statement and proxy card when they become available, because they will contain important information about the Nominees, the Company and related matters.  Shareholders may obtain a free copy of the definitive proxy statement and proxy card (when available) and other documents filed by ZimCal with the Securities and Exchange Commission (“SEC”) at the SEC’s web site at www.sec.gov.  Shareholders may also direct a request to ZimCal’s proxy solicitor, Saratoga, 520 8th Avenue, 14th Floor, New York, NY 10018 (shareholders can e-mail at info@saratogaproxy.com or call toll-free at (888) 368-0379).
Participants in Solicitation
The following persons are participants in the planned solicitation by ZimCal: ZimCal Asset Management, LLC, BIMIZCI Fund, LLC, Warnke Investments LLC, Judd Deppisch, and Stephen Hodges.  The participants may have interests in the solicitation, including as a result of holding shares of the Company’s common stock. ZimCal filed a preliminary proxy statement under cover of Schedule 14A on April 10, 2024 (the “Preliminary Proxy Statement”). Information regarding the participants and their interests is contained in the Preliminary Proxy Statement.
Please refer to the accompanying PDF document - Exhibit 1.
Exhibit 2
Disclaimer
This Website and the information contained herein (collectively, the “Website”) are being made available to all shareholders of Medallion Financial Corp. (“MFIN” or the “Company”). Except as otherwise set forth on this Website, the views expressed on this Website reflect the opinions of ZimCal Asset Management, LLC together with  BIMIZCI Fund, LLC (“BIMIZCI”), Warnke Investments LLC (“Warnke”) and Stephen Hodges (together “ZimCal”), and are based on publicly available information with respect to the Company. ZimCal recognizes that there may be confidential information in the possession of the Company that could lead it or others to disagree with ZimCal’s conclusions. ZimCal reserves the right to change any of its opinions expressed herein at any time as it deems appropriate and disclaims any obligation to notify the market or any other party of any such change, except as required by law. ZimCal disclaims any obligation to update the information or opinions contained on this Website. For the avoidance of doubt, this Website is not affiliated with or endorsed by Medallion Financial Corp.
Certain financial projections and statements made herein have been derived or obtained from filings made with the United States Securities and Exchange Commission (“SEC”) or other regulatory authorities and from other third party reports. Neither ZimCal nor any of its affiliates shall be responsible or have any liability for any misinformation contained in any third party SEC or other regulatory filing or third party report. Select figures presented on this Website have not been calculated using generally accepted accounting principles (“GAAP”) and have not been audited by independent accountants. Such figures may vary from GAAP accounting in material respects and there can be no assurance that the unrealized values reflected within such materials will be realized.
This Website does not recommend the purchase or sale of any security, and should not be construed as legal, tax, investment or financial advice, and the information contained herein should not be taken as advice on the merits of any investment decision.
Not an Offer to Sell or Buy
The materials on this Website are provided merely as information and are not intended to be, nor should they be construed as, an offer to sell or a solicitation of an offer to buy any security. ZimCal owns shares of common stock, par value $0.01 per share, of the Company (“Shares”). You should assume that ZimCal will from time to time sell all or a portion of their holdings of the Company in open market transactions or otherwise, buy additional Shares (in open market or privately negotiated transactions or otherwise), or trade in options, puts, calls, swaps or other derivative instruments relating to such Shares, regardless of the views expressed on this Website. Consequently, ZimCal’s beneficial ownership of the Shares may vary over time depending on various factors, with or without regard to ZimCal’s view of the Company’s business, prospects or valuation (including the market price of the Shares), including, without limitation, other investment opportunities available to ZimCal, conditions in the securities markets and general economic and industry conditions. However, neither ZimCal nor the other Participants (as defined below) or any of their respective affiliates has any current intention, either alone or in concert with another person, to acquire or exercise control of the Company or any of its subsidiaries. ZimCal also reserves the right to take any actions with respect to investments in the Company as it may deem appropriate, including, but not limited to, communicating with the Company’s management, the Company’s board of directors, other investors and shareholders, stakeholders, industry participants, and/or interested or relevant parties about the Company or seeking representation constituting a minority of the Company’s board of directors, and to change its intentions with respect to its investments in the Company at any time and disclaims any obligation to notify the market or any other party of any such changes or actions, except as required by law.
Although ZimCal believes the statements made on this Website are accurate in all material respects and do not omit to state material facts necessary to make those statements not misleading, ZimCal makes no representation or warranty, express or implied, as to the accuracy or completeness of those statements or any other written or oral communication it makes with respect to the Company and any other companies mentioned, and each of ZimCal, the other Participants and their respective affiliates expressly disclaim any liability relating to those statements or communications (or any inaccuracies or omissions therein). Thus, shareholders and others should conduct their own independent investigation and analysis of those statements and communications and of the Company and any other companies to which those statements or communications may be relevant.
Cautionary Statement Regarding Forward-Looking Statements
Some of the materials on this Website contain forward-looking statements. All statements contained herein that are not clearly historical in nature or that necessary depend on future events are forward-looking, and the words “anticipate,” “believe,” “expect,” “potential,” “could,” “opportunity,” “estimate,” “plan,” and similar expressions are generally intended to identify forward-looking statements.
The projected results and statements contained herein release that are not historical facts are based on current expectations, speak only as of the date of these materials and involve risks, uncertainties and other factors that may cause actual results, performances or achievements to be materially different from any future results, performances or achievements expressed or implied by such projected results and statements. Assumptions relating to the foregoing involve judgments with respect to, among other things, future economic competitive and market conditions and future business decisions, all of which are difficult or impossible to predict accurately and many of which are beyond the control of ZimCal.
Though certain material on this Website may contain projections, nothing on this Website is intended to be a prediction of the future trading price or market value of securities of the Company. Accordingly, there is no assurance or guarantee with respect to the prices at which any securities of the Company will trade, and such securities may not trade at prices that may be implied herein. The estimates, projections and potential impact of the opportunities identified by ZimCal herein are based on assumptions that ZimCal believes to be reasonable as of the date of the materials on this Website, but there can be no assurance or guarantee (i) that any of the proposed actions set forth on this Website will be completed, (ii) that the actual results or performance of the Company will not differ, and such differences may be material, or (iii) that any of the assumptions provided in this Website are accurate.
Therefore, there can be no assurance that the projected results or forward-looking statements included herein will prove to be accurate and therefore actual results could differ materially from those set forth in, contemplated by, or underlying these forward-looking statements. In light of the significant uncertainties inherent in the projected results and forward-looking statements included herein, the inclusion of such information should not be regarded as a representation as to future results or that the objectives and strategic initiatives expressed or implied by such projected results and forward-looking statements will be achieved. ZimCal will not undertake and specifically declines any obligation to disclose the results of any revisions that may be made to any projected results or forward-looking statements herein to reflect events or circumstances after the date of such projected results or statements or to reflect the occurrence of anticipated or unanticipated events.
Other Quotations and Third Party Statements
ZimCal has neither sought nor obtained the consent from any other third party to use any statements or information contained herein that have been obtained or derived from statements made or published by such third parties, nor has it paid for any such statements. Any such statements or information should not be viewed as indicating the support of such third parties for the views expressed herein. ZimCal does not endorse third-party estimates or research which are used on this Website solely for illustrative purposes. No warranty is made that data or information, whether derived or obtained from filings made with the SEC or any other regulatory agency or from any third party, are accurate. Past performance is not an indication of future results.
This Website may contain links to articles and/or videos (collectively, “Media”). The views and opinions expressed in such Media or those of the author(s)/speaker(s) referenced or quoted in such Media and, unless specifically noted otherwise, do not necessarily represent the opinions of ZimCal.
Concerning Intellectual Property
All registered or unregistered service marks, trademarks and trade names referred to on this Website are the property of their respective owners, and ZimCal’ use herein does not imply an affiliation with or endorsement by, the owners of these service marks, trademarks and trade names.
Important Information
This Website is not a solicitation of a proxy from any security holder of Medallion Financial Corp.  ZimCal intends to nominate individuals as nominees to the Company’s board of directors and intends to solicit votes for the election of those individuals, Stephen Hodges and Judd Deppisch, as members of the Company’s board of directors (the “Nominees”).  ZimCal will send a definitive proxy statement, proxy card and related proxy materials to shareholders of the Company seeking their support of the Nominees at the Company’s 2024 annual meeting of stockholders.  Stockholders are urged to read the definitive proxy statement and proxy card when they become available, because they will contain important information about the Nominees, the Company and related matters.  Shareholders may obtain a free copy of the definitive proxy statement and proxy card (when available) and other documents filed by ZimCal with the Securities and Exchange Commission (“SEC”) at the SEC’s web site at www.sec.gov.  Shareholders may also direct a request to ZimCal’s proxy solicitor, Saratoga, 520 8th Avenue, 14th Floor, New York, NY 10018 (shareholders can e-mail at info@saratogaproxy.com or call toll-free at (888) 368-0379).
Participants in Solicitation
The following persons are participants in the planned solicitation by ZimCal: ZimCal Asset Management, LLC, BIMIZCI Fund, LLC, Warnke Investments LLC, Judd Deppisch, and Stephen Hodges.  The participants may have interests in the solicitation, including as a result of holding shares of the Company’s common stock. ZimCal filed a preliminary proxy statement under cover of Schedule 14A on April 10, 2024 (the “Preliminary Proxy Statement”). Information regarding the participants and their interests may be found in the Preliminary Proxy Statement, which information is incorporated herein by reference.
Exhibit 3

BIMIZCI Fund, LLC
C/O Cogency Global Inc.
850 New Burton Road, Suite 201
Dover DE 19904
October 11, 2023
Andrew Murstein
President & COO
Medallion Financial Corp.
437 Madison Ave, 38th Floor
New York City, NY 10022
Dear Mr. Murstein,
I begin this letter by asking the Board of Directors of Medallion Financial Corp. (the “Board”) and senior leadership to objectively consider the issues I will raise. BIMIZCI Fund LLC (“BIMIZCI”) currently has a $15 million Trust Preferred securities (“TruPS”) investment in Medallion Financing Trust 1, a wholly owned subsidiary of Medallion Financial Corp. (the “Company”). We invested in February 2021. The repayment of our investment is via quarterly payments made by the Company on its junior subordinated notes held by Medallion Financing Trust 1, which in turn repay the TruPS. In prior roles and as a Member of BIMIZCI, I have invested in over 100 FDIC-insured bank lenders throughout the United States since 2012. I have talked to over 200 bank management teams, understand the financing constraints for regulated entities, and I am very familiar with every loan type on a bank balance sheet, including indirect consumer lending. I have directly invested in or managed over $350 million in performing and distressed loan and securities portfolios and understand the importance of early risk mitigation to minimize losses. In 2009 through 2011, I was heavily involved in winding down a large exposure to risky assets acquired right before the Global Financial Crisis. Due to my experience, I feel I can speak knowledgably about the unique risks facing the Company.
BIMIZCI is optimistic about the future of the Company and has dedicated considerable time to this analysis. I am confident that the Board and senior leadership will take the time to read through this in its entirety, since you are responsible for a diversified institutional and retail investor base that also believes in the future of the Company. However, we believe that the Company can only thrive if it is run properly and with strong Board oversight. Consumer lending, particularly in the areas the Company operates, is incredibly competitive with various business models and technology-focused firms looking for market share. In order to succeed, the Company will require a radical change in attitude, leadership, governance and business focus and a willingness to adapt to a rapidly changing environment. Unfortunately, the Company must do this under the cloud of an SEC lawsuit against the Company and Andrew Murstein, the COO and President of the Company.
Beginning almost a decade ago, the implosion of the Company’s Medallion portfolio resulted in an 85% loss in market cap from 1Q14 to 1Q17, and over $230 million in cumulative Medallion loan net charge-offs against a beginning Medallion loan balance of $679 million. Make no mistake that this was almost entirely caused by poor managerial decisions NOT negative short seller reports. Short sellers did not cause the credit deterioration or make the inadequate loss mitigation choices that almost sunk the Company. Looking forward, I believe the Company could face echoes of what it faced with the Medallion portfolio and this could result in tremendous value destruction and severe distress if changes are not made immediately. The probability of an adverse outcome is high given that the de facto decision-maker at the Company, who was responsible for the questionable judgment calls both before and during the Medallion implosion, is still in charge.
My attached report is broken up into 3 sections:
[This report is not included on the website]
•
Section 1 deals with governance and company leadership. I discuss the Board’s reaction to the SEC suit and its unwillingness to appoint an independent third party to investigate the serious allegations. I discuss the obvious conflicts of interest in the serendipitous valuation increase of the Company’s subsidiary, Medallion Bank (the “Bank”) as the Medallion loan portfolio deteriorated. A valuation change that the Board allowed and the SEC is investigating. I point out the egregious compensation offered to Andrew Murstein, seemingly unconnected to the profit and performance of the Company, both absolutely and relative to peers selected by the Company. I discuss the Board’s unwillingness to enforce its Clawback authority for “detrimental conduct” or mete out any punishment for violations of its code of ethics for what I believe was clearly unethical behavior.
•
Section 2 deals with the direct and indirect costs of Andrew Murstein’s actions that led to the SEC lawsuit. I discuss how Murstein’s credibility has been irreparably harmed; how the lack of trust in Murstein, and by extension, the Company could be costly. There are high direct legal expenses the Company has absorbed and the SEC suit will materially affect the Company’s ability to raise future capital on reasonable terms if at all.
•
Section 3 deals with the risks posed by the Company’s business model. I discuss how the large non-prime portion of the Recreation Lending segment presents a material threat given the macro sensitivity of non-prime borrowers going into a tougher economic climate. I discuss how credit quality could deteriorate quickly and that recent consumer trends are not positive, albeit not terrible. I discuss the Company’s Holding Company/Bank subsidiary structure and how that causes unique default risks for investors. I discuss the Company’s reliance on spread income and the margin risks that poses. I offer extensive mitigants and ideas to minimize the risks.
•
Section 4 deals with suggestions on improved disclosures in public filings. I discuss how that will increase transparency and allow an honest assessment of both the Company’s value by potential investors, and the Company’s performance by the Board.
Within each segment, I divide my analysis into 1 or more of 3 periods based on their impact on performance: 1. The earnings distortion from the Bank subsidiary Valuation increase from 2015 – 1Q2018; 2. The impact from the wind-down of the Medallion segment from 2018 – 4Q2020; and 3. The balance sheet evolution and earnings distortion (both positive and negative) from the (now) legacy non-core Medallion portfolio from 1Q2021 – 2Q2023.
This letter provides all Board members with a preliminary blueprint that I believe would allow the Company to thrive long-term and maximize returns to shareholders, creditors and other stakeholders. I consistently note that even though some of the risks I identify have been disclosed by the Company, it is woefully inadequate to simply “check the box”. The Company must take the next step and put plans in place to mitigate the impact of those risks and the Board must hold management accountable for the effectiveness of those plans. This was a clear failure during the Medallion implosion and cannot be repeated. The Board now has no plausible deniability if you ignore my suggestions and warnings and value is subsequently destroyed.
Once you have digested the contents of this letter and the attached analysis, on behalf of all stakeholders, I would like a response by October 31st, 2023. If you feel my data is inaccurate, please point that out and I will gladly review it and correct it if necessary. If I do not hear from you, I will be forced to share my observations and will seek input from the broader investment community including major shareholders and creditors and then formulate a plan to ensure the Company is best positioned to thrive in the future.
Sincerely,
/s/ Stephen Hodges
Stephen Hodges
Member, BIMIZCI Fund, LLC
Important Information
This letter is not a solicitation of a proxy from any security holder of Medallion Financial Corp. (the “Company”).  Stepehn Hodges, and his affiliates, ZimCal Asset Management, LLC, BIMIZCI Fund, LLC (“BIMIZCI”) and Warnke Investments LLC (collectively, “ZimCal”), have nominated individuals as nominees to the Company’s board of directors and intend to solicit votes for the election of those individuals, Stephen Hodges and Judd Deppisch, as members of the Company’s board of directors (the “Nominees”).  ZimCal will send a definitive proxy statement, proxy card and related proxy materials to shareholders of the Company seeking their support of the Nominees at the Company’s 2024 annual meeting of stockholders.  Stockholders are urged to read the definitive proxy statement and proxy card when they become available, because they will contain important information about the Nominees, the Company and related matters.  Shareholders may obtain a free copy of the definitive proxy statement and proxy card (when available) and other documents filed by ZimCal with the Securities and Exchange Commission (“SEC”) at the SEC’s web site at www.sec.gov.  Shareholders may also direct a request to ZimCal’s proxy solicitor, Saratoga, 520 8th Avenue, 14th Floor, New York, NY 10018 (shareholders can e-mail at info@saratogaproxy.com or call toll-free at (888) 368-0379).
Participants in Solicitation
The following persons are participants in the planned solicitation by ZimCal: ZimCal Asset Management, LLC, BIMIZCI Fund, LLC, Warnke Investments LLC, Judd Deppisch, and Stephen Hodges.  The participants may have interests in the solicitation, including as a result of holding shares of the Company’s common stock. ZimCal filed a preliminary proxy statement under cover of Schedule 14A on April 10, 2024 (the “Preliminary Proxy Statement”). Information regarding the participants and their interests may be found in the Preliminary Proxy Statement, which information is incorporated herein by reference.