Welcome!

News Feed Item

Starboard Delivers Written Requests to Call a Special Meeting From Holders of More Than 55% of Darden's Outstanding Shares

Starboard Gratified by the Strong Show of Shareholder Support for the Special Meeting Ahead of the Goal Date for Submissions

NEW YORK, April 22, 2014 /PRNewswire/ -- Starboard Value LP (together with its affiliates, "Starboard"), one of the largest shareholders of Darden Restaurants, Inc. ("Darden" or the "Company") (NYSE: DRI), with ownership of approximately 5.5% of the outstanding common stock of the Company, announced today that it has delivered by letter to Darden written requests from the holders of more than 55% of the Company's outstanding common stock to call a special meeting of shareholders (the "Special Meeting").  At the Special Meeting, Starboard will present a non-binding resolution urging the Board of Directors of Darden (the "Board") not to approve any agreement or proposed transaction involving a Red Lobster separation or spin-off (the "Red Lobster Separation") prior to the 2014 Annual Meeting of Shareholders (the "2014 Annual Meeting") unless such agreement or transaction would require shareholder approval.

Jeffrey C. Smith, Managing Member, Chief Executive Officer and Chief Investment Officer of Starboard Value LP, stated, "We are pleased that more than 55% of Darden's outstanding shares have consented to call the Special Meeting ahead of the April 24th goal date. We have met the required threshold needed to call the Special Meeting. We understand that by delivering the consents ahead of the goal date, certain shareholders may not yet have had the chance to consent. However, we have chosen to deliver the consents to Darden now in order to ensure that the Special Meeting is held as soon as possible and that Darden receives the strong and clear message that shareholders want a say on any transaction to separate Red Lobster."

Added Smith, "Over the past several months, we have detailed in numerous letters and presentations why we believe the proposed Red Lobster Separation is the wrong spin-off, at the wrong time, for the wrong reasons.  We are proud of the strong support from our fellow shareholders during the solicitation process and recognize that shareholders have taken action to demand that their voices be heard at a Special Meeting.  Shareholders fully deserve the opportunity that a Special Meeting will provide to allow for a fulsome debate as to the merit, or lack thereof, of a potential Red Lobster Separation.  This show of support from a majority of the Company's shareholders is powerful - the Board should make sure that it begins to listen to the true owners of the Company.  We believe it is incumbent upon the current Board to embrace the clear will of Darden shareholders and promptly schedule the Special Meeting so that shareholders can express their views on the Red Lobster Separation through an open and transparent process.  We are hopeful that Darden will take a step back and do the right thing by not seeking to complete any Red Lobster Separation prior to the Special Meeting."

The full text of the letter that Starboard delivered to Darden together with the written requests follows:

April 22, 2014

Darden Restaurants, Inc.
1000 Darden Center Drive
Orlando, Florida 32837
Attn:     Teresa M. Sebastian
            Senior Vice President, General Counsel and Secretary

Re:  Starboard Value LP Written Request Solicitation of Darden Restaurants, Inc. Shareholders

Dear Ms. Sebastian:

Starboard Value LP, a Delaware limited liability company ("Starboard"), with a business address of 830 Third Avenue, 3rd Floor, New York, NY 10022, hereby delivers to you, the Corporate Secretary of Darden Restaurants, Inc., a Florida corporation ("Darden" or the "Company"), written requests to call a special meeting of the Company's shareholders (the "Special Meeting") pursuant to Section 607.0702 of the Florida Business Corporations Act (the "FBCA") and  Article XI of Darden's Articles of Incorporation, as amended (the "Charter").  Such written requests are signed by shareholders of not less than 50% of all the votes entitled to be cast on any issue proposed to be considered at the proposed special meeting, as required by the FBCA and Charter.

As you can see below, Starboard has received the support of shareholders representing approximately 55.5% of the outstanding shares of Common Stock to request that the Company call the Special Meeting for the following purpose:

to approve a non-binding resolution urging the Board of Directors of the Company (the "Board") not to approve any agreement or proposed transaction involving a separation or spin-off of the Company's Red Lobster business prior to the 2014 Annual Meeting of Shareholders (the "2014 Annual Meeting") unless such agreement or transaction would require shareholder approval.

The written requests are from the holders of 73,233,321 shares of Common Stock (the "Shares") as of the March 20, 2014 record date (the "Record Date"), and represent 55.5% of the outstanding shares of Common Stock as of the Record Date.  As Darden clearly acknowledged in its Revocation Statement, "the Company must call a special meeting of shareholders upon the written, valid requests of the holders of not less than 50% of all the votes entitled to be cast on the issue proposed to be considered at the proposed special meeting." Starboard is hereby delivering valid requests of the holders of over 50% of all the votes entitled to be cast and we therefore expect the Company to call the Special Meeting without delay.

This strong show of shareholder support unequivocally demonstrates that shareholders demand the opportunity to exercise their right to call the Special Meeting and to have their voices heard promptly on the Company's proposed separation of Red Lobster (the "Red Lobster Separation").   We have received and are therefore delivering the requisite written requests ahead of our April 24, 2014 goal date.  Shareholders understand the urgency of the situation involving the Red Lobster Separation and we fully expect the Special Meeting to be called without any unnecessary delay. 

Starboard therefore urges the Company to take the necessary steps to provide notice to shareholders of the Special Meeting immediately in accordance with the Section 607.0705 of the FBCA and Charter. 

While we understand that the Company has some discretion in establishing the date, time, place and record date for the Special Meeting, we caution the Company not to attempt to delay the Special Meeting to the outer time limits provided under the FBCA and Bylaws. Starboard, as well as, we believe, all the shareholders who have joined us in requesting the Special Meeting, would view any such intentional delay as yet another in the growing list of shareholder-unfriendly actions that this Board has taken.  Starboard is hopeful that the Company will respect the clear will of its shareholders by calling the Special Meeting immediately so that shareholders can discuss this critical issue before it is too late.  

To be even more clear, if the Company has not provided notice to shareholders of the Special Meeting by Tuesday, May 6, 2014 for a Special Meeting to be held within sixty (60) days of such date, then we will have no choice but to conclude that the Company does not have a good-faith intent to call the Special Meeting in a timely manner. 

Although the Red Lobster Proposal is non-binding and would not legally prevent the Company from proceeding with the proposed separation, Starboard does not believe that the Board would sanction proceeding with the Red Lobster Separation in direct opposition to a clear shareholder directive. The Board moving forward with the Red Lobster Separation despite clear concerns of shareholders, we believe, would be an egregious violation of good corporate governance. We remind you that the Company stated in its Revocation Statement that "if a special meeting is called and Starboard's proposed resolution is presented to shareholders, serious consideration will be given to the results of the meeting and any other shareholder feedback received by the Company." 

We appreciate that the Company has acknowledged the influence of a shareholder vote and hope that the Company similarly respects the will of shareholders evidenced by the delivery of the written requests and promptly calls the Special Meeting.  If shareholders support Starboard's resolution at the Special Meeting, we believe it would be incumbent upon the Board not to proceed with the Red Lobster Separation without shareholder approval.

While we hope that it will not be necessary, Starboard hereby reserves its right to take any actions permissible under Florida law to compel the Company to call the Special Meeting, as necessary. 

The enclosed materials, which are attached hereto as Exhibit A, include:

  1. A Written Request executed by Broadridge Financial Solutions, Inc. on behalf of its clients, representing 72,845,142 Shares.
  2. A Written Request executed by Morgan Stanley & Co. Incorporated, DTC participant 50, representing 59,249 Shares.
  3. A Written Request executed by Mediant Communications, representing 63,952 Shares.
  4. Written consents executed by Registered Shareholders, representing 264,977 Shares.

The Depository Trust Company has reported that on March 20, 2014, they held 128,205,307 shares of Darden Restaurants Inc. on behalf of their clients.  According to the Company's Revocation Statement in connection with the Special Meeting, as of the Record Date, there were 131,960,633 outstanding shares of Common Stock.

Please acknowledge your receipt of this letter and the enclosed written requests by signing and date-stamping the attached copy of this letter and returning it in the postage paid envelope provided.              

Very truly yours,

Jeffrey C. Smith
Managing Member
Starboard Value LP

About Starboard Value LP

Starboard Value LP is a New York-based investment adviser with a focused and differentiated fundamental approach to investing in publicly traded U.S. small cap companies. Starboard invests in deeply undervalued small cap companies and actively engages with management teams and boards of directors to identify and execute on opportunities to unlock value for the benefit of all shareholders.

Investor contacts:
Peter Feld, (212) 201-4878
Gavin Molinelli, (212) 201-4828
www.starboardvalue.com

Okapi Partners
Bruce H. Goldfarb/Patrick McHugh
(212) 297-0720

SOURCE Starboard Value LP

More Stories By PR Newswire

Copyright © 2007 PR Newswire. All rights reserved. Republication or redistribution of PRNewswire content is expressly prohibited without the prior written consent of PRNewswire. PRNewswire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

Latest Stories
SYS-CON Events announced today that EastBanc Technologies will exhibit at SYS-CON's 18th International Cloud Expo®, which will take place on June 7-9, 2016, at the Javits Center in New York City, NY. EastBanc Technologies has been working at the frontier of technology since 1999. Today, the firm provides full-lifecycle software development delivering flexible technology solutions that seamlessly integrate with existing systems – whether on premise or cloud. EastBanc Technologies partners with p...
SYS-CON Events announced today that AppNeta, the leader in performance insight for business-critical web applications, will exhibit and present at SYS-CON's @DevOpsSummit at Cloud Expo New York, which will take place on June 7-9, 2016, at the Javits Center in New York City, NY. AppNeta is the only application performance monitoring (APM) company to provide solutions for all applications – applications you develop internally, business-critical SaaS applications you use and the networks that deli...
In the rush to compete in the digital age, a successful digital transformation is essential, but many organizations are setting themselves up for failure. There’s a common misconception that the process is just about technology, but it’s not. It’s about your business. It shouldn’t be treated as an isolated IT project; it should be driven by business needs with the committed involvement of a range of stakeholders.
SYS-CON Events announced today that ContentMX, the marketing technology and services company with a singular mission to increase engagement and drive more conversations for enterprise, channel and SMB technology marketers, has been named “Sponsor & Exhibitor Lounge Sponsor” of SYS-CON's 18th Cloud Expo, which will take place on June 7-9, 2016, at the Javits Center in New York City, New York. “CloudExpo is a great opportunity to start a conversation with new prospects, but what happens after the...
The IoTs will challenge the status quo of how IT and development organizations operate. Or will it? Certainly the fog layer of IoT requires special insights about data ontology, security and transactional integrity. But the developmental challenges are the same: People, Process and Platform. In his session at @ThingsExpo, Craig Sproule, CEO of Metavine, will demonstrate how to move beyond today's coding paradigm and share the must-have mindsets for removing complexity from the development proc...
SYS-CON Events announced today BZ Media LLC has been named “Media Sponsor” of SYS-CON's 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. BZ Media LLC is a high-tech media company that produces technical conferences and expositions, and publishes a magazine, newsletters and websites in the software development, SharePoint, mobile development and Commercial Drone markets.
Cloud computing changed data analytics for good. It enabled companies to drastically decrease resources and architecture previously assigned with business intelligence departments. It also enabled laymen to run advanced business analytics. Cloud was also the architecture of choice for storing and processing big data. Data piling is a continuous process, which is going to explode with emerging Internet of Things concept. Answer to this issue developers found in new concept called fog computing. ...
SYS-CON Events announced today that Alert Logic, Inc., the leading provider of Security-as-a-Service solutions for the cloud, will exhibit at SYS-CON's 18th International Cloud Expo®, which will take place on June 7-9, 2016, at the Javits Center in New York City, NY. Alert Logic, Inc., provides Security-as-a-Service for on-premises, cloud, and hybrid infrastructures, delivering deep security insight and continuous protection for customers at a lower cost than traditional security solutions. Ful...
SYS-CON Events announced today that MangoApps will exhibit at SYS-CON's 18th International Cloud Expo®, which will take place on June 7-9, 2016, at the Javits Center in New York City, NY. MangoApps provides modern company intranets and team collaboration software, allowing workers to stay connected and productive from anywhere in the world and from any device. For more information, please visit https://www.mangoapps.com/.
The cloud market growth today is largely in public clouds. While there is a lot of spend in IT departments in virtualization, these aren’t yet translating into a true “cloud” experience within the enterprise. What is stopping the growth of the “private cloud” market? In his general session at 18th Cloud Expo, Nara Rajagopalan, CEO of Accelerite, will explore the challenges in deploying, managing, and getting adoption for a private cloud within an enterprise. What are the key differences betwee...
WebRTC is bringing significant change to the communications landscape that will bridge the worlds of web and telephony, making the Internet the new standard for communications. Cloud9 took the road less traveled and used WebRTC to create a downloadable enterprise-grade communications platform that is changing the communication dynamic in the financial sector. In his session at @ThingsExpo, Leo Papadopoulos, CTO of Cloud9, will discuss the importance of WebRTC and how it enables companies to fo...
As machines are increasingly connected to the internet, it’s becoming easier to discover the numerous ways Industrial IoT (IIoT) is helping to shape the business world. This is exactly why we have decided to take a closer look at this pervasive movement and to examine the desire to connect more things! Now if you need a refresher on IIoT and how it is changing the world, take a moment and listen to Greg Gorbach with ARC Advisory Group. Gorbach believes, "IIoT will significantly change the worl...
The IoT is changing the way enterprises conduct business. In his session at @ThingsExpo, Eric Hoffman, Vice President at EastBanc Technologies, discuss how businesses can gain an edge over competitors by empowering consumers to take control through IoT. We'll cite examples such as a Washington, D.C.-based sports club that leveraged IoT and the cloud to develop a comprehensive booking system. He'll also highlight how IoT can revitalize and restore outdated business models, making them profitable...
In his session at 18th Cloud Expo, Bruce Swann, Senior Product Marketing Manager at Adobe, will discuss how the Adobe Marketing Cloud can help marketers embrace opportunities for personalized, relevant and real-time customer engagement across offline (direct mail, point of sale, call center) and digital (email, website, SMS, mobile apps, social networks, connected objects). Bruce Swann has more than 15 years of experience working with digital marketing disciplines like web analytics, social med...
SYS-CON Events announced today that Super Micro Computer, Inc., a global leader in Embedded and IoT solutions, will exhibit at SYS-CON's 18th International Cloud Expo®, which will take place on June 7-9, 2016, at the Javits Center in New York City, NY. Supermicro (NASDAQ: SMCI), the leading innovator in high-performance, high-efficiency server technology, is a premier provider of advanced server Building Block Solutions® for Data Center, Cloud Computing, Enterprise IT, Hadoop/Big Data, HPC and ...