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
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
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
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
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
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