Darden Urges Shareholders To Support Its New Board Proposal - Quick Facts

(RTTNews) - Darden Restaurants, Inc. (DRI) urged its shareholders to support change and continued progress on Darden's operating priorities by rejecting Starboard Value L.P. and its affiliates'efforts to take control of Darden by replacing all 12 members of the Board with its own preferred nominees and without paying a control premium. The 2014 Annual Meeting of Shareholders will be held on October 10, 2014.

In its letter to its shareholders, Darden said that its board is committed to looking at the Company with a fresh perspective and recently announced a new slate that aligns with that priority. It is a slate that includes four new, independent nominees unaffiliated with the Company or Starboard, all of who have served as CEOs of major companies; four returning director nominees, all of who are committed to the positive change Darden is undertaking and to working constructively with the other members of the reconstituted Board; and four seats to be filled by candidates proposed by Starboard.

Together with a new Chief Executive Officer, the search for whom is underway, this is real change for the company.

Darden said it is concerned that replacing the entire Darden Board, as Starboard is seeking to do, would create a void in constructive leadership that would be significantly destabilizing to the Company.

In recognition of the significant risks associated with a full turnover of Darden's Board that Starboard is seeking, as well as the distraction and costs associated with Starboard's proxy contest, Darden noted that it has made numerous attempts to reach an agreement with Starboard that would enable the company to avoid this proxy contest.

However, Darden said that Starboard has, to date, rejected the proposals the company has made. It is disappointed that rather than work with it to achieve a mutually acceptable resolution that serves the interests of all Darden shareholders, Starboard remains set on pursuing its costly and disruptive proxy contest to take control of the company.

In doing so, Starboard appears to be putting its interests ahead of shareholders own. By attempting to replace all 12 members of Darden's Board with its own preferred nominees, Starboard is seeking effective control of the Company - representation which is disproportionate to Starboard's approximate 8.8% stake in Darden and which does not offer Darden shareholders a control premium for such change in control.

On Wednesday, Responding to Darden's announced new slate of director nominees for election at 2014 annual meeting, Starboard said it believed Darden's reactive, last-minute decision to delay the annual meeting and propose a new slate was just another poorly conceived and suboptimal solution.