11.4% Shareholders & Former Executive Management of LCA-Vision Seek Board Representation and Executive Management Positions
05 December 2008 - 6:52AM
PR Newswire (US)
CINCINNATI, Dec. 4 /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
1,000% from 2003-2006. In a letter, dated December 4, 2008, to Tony
Woods and the other members of the Board of Directors of
LCA-Vision, the group stated they were "perplexed" by the Board's
failure to solicit their help saving the Company from its current
path of self-destruction. Given the Company's dire condition and
poor prognosis, coupled with the group's impeccable credentials at
growing shareholder value at the Company, the group realized the
"disconnect" may be the Board's need for further clarity on
specifically how the group could help. In the letter, the group
states, "The three of us believe we can add tremendous value to the
Company, its shareholders, and its physicians and employees by
providing us Board representation and reappointing us to executive
management positions in the Company. We have no doubt we can help
provide the strategic vision the Company needs today, and have the
experience and expertise to execute that strategy. We also believe
that with these changes, the Board can fulfill its fiduciary duties
to its shareholders by helping return some, if not all, of the
shareholder value that has been so dramatically squandered over the
last couple of years. We have the unique experience and know-how to
help get the Company back on track. As large shareholders with deep
roots to the Company, we also have the passion and commitment to
make it happen. Given the current cash burn at the Company, we
would appreciate a timely response to our requests made in this
letter." 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 and as a Director of Anchor
Funding Services, the letter dated November 24, 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 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; 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 & CERTIFIED MAIL December 4, 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 we
have previously expressed to you, we are significant shareholders
who feel financial, ethical, and reputational responsibilities to
the Company and its shareholders to save LCA-Vision from its
current path to self-destruction. From the Board's lack of
responsiveness to our initial discussions, to the recent promotion
of Mike Celebrezze to CFO, to the adoption of the "poison pill"
without shareholder approval, it became apparent to us that the
Board may have outstanding questions or concerns about our genuine
offer to help the Company. Admittedly, this is perplexing to us for
two reasons. First, the Company's condition today is dire, its
prognosis going forward poor. With the stock price decreasing
approximately 90% since the Board appointed Steve Straus CEO in
November 2006, the elimination of the quarterly dividend to
shareholders, and the suspension of the share repurchase program,
the status of the Company today from its recent successes tells a
sad tale. So, too, do the Company's financial and operating
results. Needless to say, dramatic losses in national market share
and revenues plummeting 50% (which is well in excess of overall
industry declines) are not typically associated with healthy
companies. And with the Company burning approximately $2 million of
cash per month, we can only assume that, like us, the Board is
having its share of sleepless nights. Second, we think the Board
would be hard-pressed to find fault with our impeccable credentials
in the laser vision correction industry generally, and with
LCA-Vision specifically. It was under our leadership that
LCA-Vision provided enviable returns to its shareholders well in
excess of 1,000% from 2003-2006. It was under our leadership that
the Company's physician partners and employees thrived, financially
and professionally. It was under our leadership that the Company
generated substantial free cash flow that was used to profitably
open vision centers, pay quarterly dividends to the Company's
shareholders, repurchase shares, and build a rock solid balance
sheet. So, (i) given the Company is in dire need of help and (ii)
the three of us represent the very team that is uniquely positioned
to provide such help, we realized there must be a disconnect
somewhere along the way. Recognizing the Board may not feel it
understands specifically how we can help, we thought it would be
helpful to provide the necessary clarity. The three of us believe
we can add tremendous value to the Company, its shareholders, and
its physicians and employees by providing us Board representation
and reappointing us to executive management positions in the
Company. We have no doubt we can help provide the strategic vision
the Company needs today, and have the experience and expertise to
execute that strategy. We also believe that with these changes, the
Board can fulfill its fiduciary duties to its shareholders by
helping return some, if not all, of the shareholder value that has
been so dramatically squandered over the last couple of years. We
have the unique experience and know-how to help get the Company
back on track. As large shareholders with deep roots to the
Company, we also have the passion and commitment to make it happen.
Given the current cash burn at the Company, we would appreciate a
timely response to our requests made in this letter. 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 John
Gutfreund, LCAV's Chairman of Nominating & Governance
Committee; Director of GVI Securities Solutions John Hassan,
Independent Director, Chairman of Audit Committee For Further
Information: Lisa Blaker 9560 Montgomery Road Cincinnati, Ohio
45242 (513) 659 2001 DATASOURCE: Steve Joffe CONTACT: Lisa Blaker
for Steve Joffe, +1-513-659 2001
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