LCA-Vision's Former Executive Management Urge Board of Directors to Immediately Call Special Shareholder Meeting to Approve Pois
December 09 2008 - 3:32PM
PR Newswire (US)
Claiming Now is Not the Time for Alleged Paternalism, Group Seeks
Timely Response CINCINNATI, Dec. 9 /PRNewswire/ -- Dr. Stephen
Joffe, Craig Joffe, and Alan Buckey today filed an amendment to
their Schedule 13D with the U.S. Securities and Exchange
Commission. The group previously filed a 13D disclosing ownership
of 11.4% of LCA-Vision, Inc. (NASDAQ:LCAV), which operates 77
LasikPlus fixed-site laser vision correction centers in 33 states
in the United States. Dr. Joffe is the founder and former Chairman
and CEO of LCAV. Craig Joffe is the former Chief Operating Officer
and General Counsel of LCAV, and Alan Buckey is the former
Executive Vice President of Finance and Chief Financial Officer of
the Company. The three of them worked together as the executive
management team of LCAV (NASDAQ:LCAV) to grow the market
capitalization of the Company well in excess of 1000% from
2003-2006. In a letter, dated December 9, 2008, to Tony Woods and
the other members of the Board of Directors of LCA-Vision, the
group reiterated their "shock and disappointment" at the Board's
recent decision to adopt a "stockholder rights plan," commonly
known as a poison pill. In their letter to the Board, the group
states, "We are disappointed that LCA-Vision's Board did not ask
shareholders to vote on the poison pill before the Board adopted
it. Given the dire state of the Company, now is decidedly not the
time for alleged paternalism. We believe, however, there is a
solution to this recent issue. We respectfully urge the Board to
call a special shareholder meeting empowering shareholders to
timely vote on the poison pill. This special shareholder meeting
would allow the Board of Directors and the executive management
team an opportunity to more fully explain why they believe this
poison pill is in fact in the best interests of shareholders. In
addition, it would provide an opportunity for shareholders to
timely agree or disagree, as the case may be, with the Board of
Directors and executive management team on the wisdom of their
judgment. Needless to say, with the Company burning approximately
$2 million of cash per month and revenues plummeting approximately
50%, when it comes to LCA-Vision, time is not a luxury any of us
can afford." In addition to Mr. E. Anthony Woods, who in addition
to serving as Chairman of LCA-Vision, also serves as a Director of
Cincinnati Financial Corporation (CINF) and as a Director of Anchor
Funding Services (AFNG.OB), the letter dated December 9, 2008, was
also copied to Mr. William Bahl, who serves as Chairman of LCAV's
Compensation Committee, Director and Chairman of the Nominating
Committee of the Board of Cincinnati Financial Corporation (CINF)
and as President & Co-Founder of Bahl & Gaynor; Mr. John
Gutfreund, who serves as Chairman of LCAV's Nominating and
Governance Committee and on the Board of Directors of several
over-the-counter traded companies, including GVI Securities
Solutions (GVSS.OB); John Hassan, Chairman of LCAV's Audit
Committee; and Steven Straus, LCAV's CEO. (The full text of the
letter appears below) About Dr. Stephen N. Joffe Stephen N. Joffe,
MD, FACS, age 65, is the founder and former Chairman and Chief
Executive Officer of LCA-Vision. He was the founder of LCA-Vision's
corporate predecessor, Laser Centers of America, Inc., and served
as its Chairman of the Board and Chief Executive Officer from its
formation in 1985 until its merger into LCA-Vision in 1995. In
1983, Stephen Joffe also founded and served as Chairman of Surgical
Laser Technologies, Inc. until 1989. He is presently the Chief
Executive Officer of the Hearing Foundation, Inc., a hearing
company, and Co-Founder of Joffe MediCenter LLC, a healthcare
services company. In addition Dr. Joffe is an Esteemed Quondum
Professor of Surgery at the University of Cincinnati Medical
Center, an honor he has held since 1990. He has held other medical
faculty appointments at the Universities of London, Glasgow and
Cincinnati and fellowships in the American College of Surgeons and
the Royal College of Surgeons in Edinburgh and Glasgow. He has
published 170 articles in peer-reviewed and scientific journals and
authored 35 chapters for medical books as well as written and
edited several books on lasers and their application to medicine
and surgery. About Craig P.R. Joffe Craig P.R. Joffe, age 36, was
Interim Chief Executive Officer of LCA-Vision from March 2006
through November 2006. He was appointed Chief Operating Officer of
LCA-Vision in September 2005, a position he held through his
resignation in March 2008. He also served as Secretary of LCA
Vision from March 2003, when he joined the Company, until March
2008. He also served on the Board of Directors of LCA-Vision from
2004 through March 2008, and previously served as a Director from
1995 to 1997. Prior to joining LCA-Vision, Mr. Joffe served as
Assistant General Counsel of IAC/InterActiveCorp, a leading
publicly traded interactive commerce company, from September 2000
to February 2003. Previously, Mr. Joffe, a graduate of Harvard Law
School and Columbia University, was a general practice associate in
the New York and London offices of the law firm Sullivan &
Cromwell for over three years, where he concentrated his practice
on corporate finance transactions. Mr. Joffe is currently the Chief
Executive Officer and Co-Founder of Joffe MediCenter LLC, a
healthcare services company. About Alan H. Buckey Alan H. Buckey,
age 50, was Executive Vice President of Finance and Chief Financial
Officer for LCA-Vision from March 2000 to June 2008. He came to
LCA-Vision from Pease Industries, a manufacturing company based in
Fairfield, Ohio, where he served as Vice President, Finance from
1991 to February 2000. Prior to 1991, Mr. Buckey served as Chief
Financial Officer of the Hilltop Companies, a contract laboratory
research firm and as a senior manager with Ernst & Young's
Great Lakes Consulting Group. While at Ernst & Young, he served
as acting Chief Financial Officer of a start-up laser surgery
management company which was the predecessor of LCA-Vision. Mr.
Buckey holds a B.S. in Applied Science from Miami University and
holds an M.B.A. in Finance from the Wharton School, University of
Pennsylvania. He is a Certified Public Accountant. Stephen N. Joffe
Craig P. Joffe Alan H. Buckey 9560 Montgomery Road Cincinnati, OH
45242 VIA EMAIL & FEDERAL EXPRESS December 9, 2008 Mr. E.
Anthony Woods, Chairman of the Board LCA-Vision, Inc. c/o
LCA-Vision, Inc. 7840 Montgomery Road Cincinnati, Ohio 45236 Dear
Tony: As you and the Board of Directors are aware, we are major
shareholders of LCA-Vision, Inc. who feel financial, ethical, and
reputational responsibilities to the Company and its shareholders
to help save the Company from its apparent path to
self-destruction. We previously communicated to you our initial
shock and disappointment at the Board's recent decision to adopt a
"stockholder rights plan," commonly known as a poison pill. Our
understanding of poison pills and similar types of corporate
governance maneuverings indicated that such actions are often
associated with Boards of Directors and executive management teams
seeking to entrench themselves, protecting their positions and
their compensation often at the expense of their shareholders and
shareholder value. We are disappointed that LCA-Vision's Board did
not ask shareholders to vote on the poison pill before the Board
adopted it. Given the dire state of the Company, now is decidedly
not the time for alleged paternalism. We believe, however, there is
a solution to this recent issue. We respectfully urge the Board to
call a special shareholder meeting empowering shareholders to
timely vote on the poison pill. This special shareholder meeting
would allow the Board of Directors and the executive management
team an opportunity to more fully explain why they believe this
poison pill is in fact in the best interests of shareholders. In
addition, it would provide an opportunity for shareholders to
timely agree or disagree, as the case may be, with the Board of
Directors and executive management team on the wisdom of their
judgment. Needless to say, with the Company burning approximately
$2 million of cash per month and revenues plummeting approximately
50%, when it comes to LCA-Vision, time is not a luxury any of us
can afford. Since announcing our investment in the Company, we have
made repeated attempts to help the Board initiate necessary changes
at the Company. With the Board systematically ignoring our requests
or remaining silent, to date our requests feel as if they are
falling on deaf ears. In fact, in our very first meeting with
yourself and Mr. Bahl when we initially extended our hand in good
faith to offer our help, we were literally told that the two of you
were "in listen only mode" and that you may or may not follow up
with us regarding the matters raised in the meeting. We
respectfully urge you not to let this represent yet another time
when our requests are ignored, yet another opportunity squandered.
In the third quarter of 2008, we believe the Company had an
adjusted EBITDA loss of approximately $2 million per month.
Clearly, this is not the time to sit passive on the sidelines and
blindly hope that the situation improves. We respectfully call for
a response from the Board by 5:00 p.m. EST on Friday, December 12,
2008 to our request that the Board call a special shareholder
meeting to approve the poison pill. Sincerely, Stephen N. Joffe
Craig P.R. Joffe Alan Buckey cc: LCA-Vision, Inc. Board of
Directors William Bahl, LCAV's Chairman of Compensation Committee;
Director of Cincinnati Financial Corporation (CINF) John Gutfreund,
LCAV's Chairman of Nominating & Governance Committee; Director
of GVI Securities Solutions (GVSS.OB) John Hassan, Independent
Director, Chairman of Audit Committee Steven Straus, LCAV's CEO
DATASOURCE: Steve Joffe CONTACT: Lisa Blaker, +1-513-659-2001, for
Steve Joffe
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