Starboard Value and Opportunity Master Fund Ltd., an affiliate of RCG Starboard Advisors, LLC and Ramius Capital Group, L.L.C. (collectively, "Ramius), today announced that it has filed a short presentation with additional information for Luby's shareholders ("Luby's or the "Company) (NYSE: LUB). The presentation and other proxy materials are available at www.ShareholdersForLubys.com or www.sec.gov.
In the presentation, Ramius demonstrates that the Pappases have made an estimated 235% return on the convertible notes issued to them at the time they joined the Company versus a meager 28% return for shareholders over that same period. Additionally, Ramius highlights:
- The Pappases' purchase of convertible notes with a conversion price significantly below the stock price on the date of the purchase;
- Luby's decision not to finalize a refinancing deal with GE Capital which put the Company in default under its credit facility;
- The subsequent cross-default called by the Pappases under the convertible notes due to the default under the credit facility;
- The Board's approval of lowering the conversion price on the Pappases' convertible notes from $5.00 to $3.10 at a time when the stock price was $5.63, effectively giving the Pappases an additional 1.2 million shares;
- The Board's approval of increasing the interest rate on the convertible notes from approximately 3.5% to 9.0% at that time; and
- Additional analysis surrounding management's expectations for Internal Rates of Return of 15% to 20% for the new restaurant prototype.
Ramius' knowledgeable, experienced and truly independent director nominees will provide a renewed focus on improving operations, corporate governance and management accountability through more effective Board oversight. They are committed to working constructively with the other Luby's directors and management in order to ensure that the Company is run for the best interest of all shareholders.
Ramius strongly encourages Luby's shareholders to sign, date, and return the GOLD proxy card with a vote "FOR" the election of Stephen Farrar, William Fox, Brion Grube, and Matthew Pannek.
Shareholders who have questions, or need assistance in voting their shares, should call Ramius' proxy solicitors, Innisfree M&A Incorporated, Toll-Free at 1-877-800-5185. For more information on how to vote, as well as other proxy materials, please visit www.ShareholdersForLubys.com
About Ramius Capital Group, L.L.C.
Ramius Capital Group is a registered investment advisor that manages assets of approximately $9.6 billion in a variety of alternative investment strategies. Ramius Capital Group is headquartered in New York with offices located in London, Tokyo, Hong Kong, Munich, and Vienna.
CERTAIN INFORMATION CONCERNING THE PARTICIPANTS
On November 30, 2007, Starboard Value and Opportunity Master Fund Ltd., an affiliate of Ramius Capital Group, L.L.C. ("Ramius Capital), together with the other participants named herein, made a definitive filing with the Securities and Exchange Commission ("SEC) of a proxy statement and an accompanying GOLD proxy card to be used to solicit votes for the election of its nominees at the 2008 annual meeting of shareholders of Luby's, Inc., a Delaware corporation (the "Company).
RAMIUS CAPITAL ADVISES ALL SHAREHOLDERS OF THE COMPANY TO READ THE DEFINITIVE PROXY STATEMENT BECAUSE IT CONTAINS IMPORTANT INFORMATION. THE DEFINITIVE PROXY STATEMENT IS AVAILABLE AT NO CHARGE ON THE SEC'S WEB SITE AT HTTP://WWW.SEC.GOV. IN ADDITION, THE PARTICIPANTS IN THE PROXY SOLICITATION WILL PROVIDE COPIES OF THE DEFINITIVE PROXY STATEMENT WITHOUT CHARGE UPON REQUEST. REQUESTS FOR COPIES SHOULD BE DIRECTED TO THE PARTICIPANTS' PROXY SOLICITOR, INNISFREE M&A INCORPORATED, AT ITS TOLL-FREE NUMBER: (877) 800-5185.
The participants in the proxy solicitation are Starboard Value and Opportunity Master Fund Ltd., a Cayman Islands exempted company ("Starboard), Parche, LLC, a Delaware limited liability company ("Parche), RCG Enterprise, Ltd, a Cayman Islands exempted company ("RCG Enterprise), RCG Starboard Advisors, LLC, a Delaware limited liability company ("RCG Starboard), Ramius Capital Group, L.L.C., a Delaware limited liability company ("Ramius Capital), C4S & Co., L.L.C., a Delaware limited liability company ("C4S), Peter A. Cohen, Morgan B. Stark, Thomas W. Strauss, Jeffrey M. Solomon, Stephen Farrar, William J. Fox, Brion G. Grube, Matthew Q. Pannek, Jeffrey C. Smith and Gavin Molinelli (the "Participants).
As of January 7, 2008, Starboard beneficially owned 1,778,616 shares of Common Stock of the Company and Parche beneficially owned 338,784 shares of Common Stock of the Company. As the sole non-managing member of Parche and owner of all economic interests therein, RCG Enterprise is deemed to beneficially own the 338,784 shares of Common Stock of the Company owned by Parche. As the investment manager of Starboard and the managing member of Parche, RCG Starboard Advisors is deemed to beneficially own the 1,778,616 shares of Common Stock of the Company owned by Starboard and the 338,784 shares of Common Stock of the Company owned by Parche. As the sole member of RCG Starboard Advisors, Ramius Capital is deemed to beneficially own the 1,778,616 shares of Common Stock of the Company owned by Starboard and the 338,784 shares of Common Stock of the Company owned by Parche. As the managing member of Ramius Capital, C4S is deemed to beneficially own the 1,778,616 shares of Common Stock of the Company owned by Starboard and the 338,784 shares of Common Stock of the Company owned by Parche. As the managing members of C4S, each of Mr. Cohen, Mr. Stark, Mr. Strauss and Mr. Solomon is deemed to beneficially own the 1,778,616 shares of Common Stock of the Company owned by Starboard and the 338,784 shares of Common Stock of the Company owned by Parche. Messrs. Cohen, Stark, Strauss and Solomon disclaim beneficial ownership of such shares of Common Stock of the Company except to the extent of their pecuniary interest therein. As members of a "group for the purposes of Rule 13d-5(b)(1) of the Securities Exchange Act of 1934, as amended, Messrs. Farrar, Fox, Grube, Pannek, Smith and Molinelli are deemed to beneficially own the 1,778,616 shares of Common Stock of the Company owned by Starboard and the 338,784 shares of Common Stock of the Company owned by Parche. Messrs. Farrar, Fox, Grube, Pannek, Smith and Molinelli each disclaim beneficial ownership of shares of Common Stock of the Company that they do not directly own.
