The
LCA-Vision Full Value Committee Releases Letter to LCAV (NASDAQ:LCAV)
Stockholders:
Thursday
February 26, 3:39 pm ET
Claims
Current Board and Management Lack a Fundamental Understanding of LCAV’s
Business
CINCINNATI--(BUSINESS
WIRE)--The LCA-Vision Full Value Committee announced today that it has released
the following letter to the stockholders of LCA-Vision, Inc. (NASDAQ: LCAV -
News):
The
LCA-Vision Full Value Committee
February
26, 2009
Dear
Fellow Shareholder:
We need your support for
our efforts to restore shareholder value at LCA-Vision (NASDAQ:
LCAV
-
News
)
. The current Board and
management have
presided
over an historic loss of approximately $950 million in stockholder
value.
It should be clear to all stockholders that they lack a
fundamental understanding of LCAV’s business; they don’t understand the key
elements that drive profitability; they have lost significant market share to
the Company’s competitors; and they don’t understand how to fix the major
problems confronting our Company.
While
stockholders have suffered mightily,
the current Board has
doubled its own compensation and has failed to take any effective action to
restore stockholder value.
Time is
of the essence. Please sign date and return the enclosed
WHITE
consent card as soon as
possible with a vote to remove the existing members of the Board and to replace
them with our h
ighly
qualified nominees.
Our nominees, if elected, will
restore the management team that helped build LCAV into one of the fastest
growing small cap companies in the United States, according to both
Fortune
magazine and
Business
Week
.
You may have
re
cently received a letter from CEO Steve Straus crowing about his
“success” in increasing market share in the fourth quarter of
2008. Somehow, he neglected to mention that the fourth quarter
results were the worst in the Company’s history – we don’t consider an adjusted
operating loss of $13 million something to crow about.
If the Company considers these
“successful” results, then clearly LCAV shareholders can not afford any more of
Steve Straus’s “successes”.
You should also know that
Mr.
Straus has
recently
acknowledged publicly that the first quarter 2009 procedures will probably be
down “about 35%” on a year over year basis,
significantly worse than
his recent letter would lead you to believe.
Mr. Straus also points
with pride to current manag
ement’s new “Lifetime Vision” model
. But he conveniently
neglects to mention that management has provided minimal details of the
financial impact to the Company of their new program. When asked on a
recent conference call what he expected the margins would be for “Lifetime
Vision”, the CFO responded: “Too early to tell.”
One would
expect the Board and management team to provide more details to stockholders of
their “primary focus” for 2009, especially in the midst of an election
contest.
It appear
s that
“Lifetime Vision” is little more than rhetoric that LCAV’s Board and management
don’t really understand. They project $30 million in revenue from it,
yet cannot tell you: exactly what it costs to perform the procedures; what
retraining is required
of Company surgeons; what
incremental marketing costs will be needed; and what upgrades to existing
centers and additional equipment will cost. An analyst who follows the Company
closely has said that a more realistic target is only an incremental $10.2
mi
llion in annual sales – not this year, but in 2010.
Our proposed new management team -
Dr. Stephen Joffe, former Chairman, CEO and Founder; Alan Buckey, former Chief
Financial Officer; and Craig Joffe, former Chief Operating Officer - offer real
plans
based
on hard-earned experience, not just rhetoric. They built the business and
understand the core drivers of profitability at
LCAV.
The key
element of our plan is to focus on those key profit drivers: high quality
patient care, delivering more patients by word-of-mouth referral; significantly
reducing marketing costs from their current unsustainable, stratospheric levels;
and restoring the management teams and processes needed to ensure optimal
patient
conversions. Once the Company again becomes healthily cash flow
positive, we will expand the number of vision centers and the range of services
we offer.
That is
the proven way to restore shareholder value.
For more
details, please go to our website:
www.LCAVisionFullValueCommittee.com
We are
the largest
shareholders of LCA-Vision. We believe the Company’s very existence
as a going concern may be threatened by the precarious course the current
management and Board have set. Mr. Straus’s track record, both during
his tenure at LCA-Vision and previously, is certainly dubious, at
best. Just ask the shareholders of MSO Medical, Mr. Straus’s last
venture. LCA-Vision, after having suffered through 2 years of Mr.
Straus’s failed leadership and currently burning over $2.5 million of cash per
month, now has less than $60 million to burn through while Mr. Straus
“experiments” with new business models. After that is
gone…….
Protect
your investment. Execute your consent today. Sign date and
return the WHITE consent card that accompanies this letter, and give us the
opportunity to preserve the Company and to nurture and grow our investments
together.
Thank you
for your support,
Dr.
Stephen N. Joffe
On behalf
of the LCA-Vision Full Value Committee
CERTAIN
INFORMATION CONCERNING PARTICIPANTS
On
February 6, 2009, The LCA-Vision Full Value Committee made a definitive filing
with the Securities and Exchange Commission (“SEC”) of a consent solicitation
statement relating to the solicitation of written
consents from
stockholders of the Company in connection with seeking to remove and replace the
current members of the Board of Directors of the Company.
THE LCA-VISION FULL VALUE
COMMITTEE ADVISES ALL STOCKHOLDERS OF THE COMPANY TO READ THE CONSENT
SOLICI
TATION STATEMENT AND ANY OTHER SOLICITATION MATERIALS AS THEY
BECOME AVAILABLE BECAUSE THEY CONTAIN IMPORTANT INFORMATION. SUCH SOLICITATION
MATERIALS WILL BE AVAILABLE AT NO CHARGE ON THE SEC’S WEB SITE AT
HTTP://WWW.SEC.GOV
. IN ADDITION, THE
PARTICIPANTS IN THIS SOLICITATION WILL PROVIDE COPIES
OF THE CONSENT
SOLICITATION STATEMENT WITHOUT CHARGE UPON REQUEST. REQUESTS FOR COPIES SHOULD
BE DIRECTED TO THE PARTICIPANTS’ SOLICITOR BY CALLING, TOLL-FREE,
(888)750-5834.
The
participants in the consent solicitation are Dr. Stephen N. Joffe, Craig P.R.
Joffe, Alan H. Buckey, Jason T. Mogel, Robert Probst, Robert H. Weisman and
Edward J. VonderBrink.
As of the
date of this filing, Dr. Joffe directly beneficially owns 1,171,952 shares of
Common Stock of the Company, Craig P.R. Joffe directly beneficially owns 865,468
shares of Common Stock of the Company, and Alan H. Buckey directly beneficially
owns 77,900 shares of Common Stock of the Company.
For the
purposes of Rule 13d-5(b)(1) of the Securities Exchange Act of 1934, as amended,
each of the participants in this solicitation is deemed to beneficially own the
shares of Common Stock of the Company beneficially owned in the aggregate by the
other participants. Each of the participants in this proxy solicitation
disclaims beneficial ownership of such shares of Common Stock except to the
extent of his or its pecuniary interest therein.
Contact:
For The
LCA-Vision Full Value Committee and Stephen N. Joffe
Lisa
Blaker, 513-600-1867