Starboard Delivers Open Letter To Shareholders Of Tessera Technologies

    Starboard Delivers Open Letter To Shareholders Of Tessera Technologies

States that Abrupt Resignations of Kevin Rivette and John Goodrich are
Extremely Disturbing and Point to a Dictatorial Chairman and Dysfunctional
Board Environment

Believes Material Changes in Board Composition, Executive Leadership, and
Corporate Strategy are Immediately Required in Light of Impending Director
Resignations, Recent Executive Departures, Dismal Operating Performance and
Poor Governance

Intends to File Proxy Materials over the Coming Weeks in Furtherance of
Replacing Majority of the Current Board with Highly-Qualified Director
Nominees

PR Newswire

NEW YORK, March 1, 2013

NEW YORK, March 1, 2013 /PRNewswire/ --Starboard Value LP (together with its
affiliates, "Starboard"), one the largest shareholders of Tessera
Technologies, Inc. (NASDAQ: TSRA) ("Tessera" or the "Company")with
approximately 7% of the outstanding common stock of the Company, announced
today that it has delivered an open letter to the shareholders of Tessera, the
full text of which is included below:

March 1, 2013

Open Letter to Shareholders of Tessera Technologies, Inc.

Dear Fellow Shareholders:

Starboard Value LP, together with its affiliates ("Starboard"), currently owns
approximately 7% of the outstanding common shares of Tessera Technologies,
Inc. ("Tessera" or the "Company"), making us one of the Company's largest
shareholders. As we described in a letter we delivered to the Board of
Directors of Tessera (the "Board") and publicly disclosed on February 19, 2013
(the "First Letter"), we believe the Company is significantly undervalued and
that opportunities exist within the control of management and the Board to
unlock value for the benefit of all shareholders. For over a year now, we
have been attempting to communicate constructively with Tessera in the hope
that we could work together to craft a strategy to improve the Company's
financial performance and deliver increased value to shareholders of the
Company.Unfortunately, the existing management team and Board have shown no
interest in working with us and instead have adopted certain measures designed
to disenfranchise shareholders and entrench a subset of the Board.

Recent events indicate that the center of power on the Board and management
has no intention of changing, and, in fact, has taken actions to further
entrench and insulate themselves from outside influence. The frustration from
the Company's dismal performance and poor governance has now extended beyond
shareholders to include two well-respected board members. On February 25,
2013, due to Sarbanes-Oxley requirements, it was publicly reported that three
days earlier, two incumbent directors of Tessera, Kevin Rivette and John
Goodrich, had delivered a letter to the Board stating that their concerns
regarding the behavior of the Chairman had become untenable and that they
intended to resign, effective as of the close of business today, if the
Chairman of the Board, Mr. Robert Boehlke, had not resigned from the Board
before such time. The letter clearly articulated the rationale for their
actions:

"In our opinion the failure of current board leadership has prevented
effective operating oversight, effective cost control, strategic planning,
profit and loss discipline, economically rational strategies for our DOC
initiatives and appropriate focus on our core business. The negative effect of
these failures has significantly impacted shareholder value." – Directors
Kevin Rivette and John Goodrich

"Mr. Boehlke has arrogated to himself necessary board review and guidance of
management.... His actions have interfered with the board's orderly and
necessary oversight of the company." – Directors Kevin Rivette and John
Goodrich

"We believe [Mr. Boehlke's] actions have prevented our board from meeting its
required standards of performance and returning value to the shareholders. It
is our belief that his efforts to force the removal of directors who do not
support him and to independently find new directors violates the authority of
the nominating committee and of the full board...." – Directors Kevin Rivette
and John Goodrich

"We have repeatedly tried to affect what we believe are necessary reforms such
as greater focus on our core business, effective cost controls, investment
analysis and improved board governance to make this company highly successful.
Each time Mr. Boehlke has prevented these initiatives from moving forward." –
Directors Kevin Rivette and John Goodrich

The abrupt resignations of Kevin Rivette, a seasoned executive with
significant expertise in intellectual property strategy through his
experiences at 3LP Advisors and IBM Corporation, and John Goodrich, a named
former partner of Wilson Sonsini Goodrich & Rosati, a well-respected law firm,
are cause for serious concern. Needless to say, the contents of their
resignation letter are extremely disturbing and point to a dictatorial
Chairman and dysfunctional board environment in desperate need of shareholder
intervention. In our experience, we have rarely witnessed such scathing
accusations and internal upheaval, with disagreements rising to a level where
highly qualified board members felt they had no choice but to resign because
of the actions of the Chairman of the Board.

Further, the resignation of Messrs. Goodrich and Rivette follows a long list
of executive departures, including the recent departures of Dr. Farzan "Bob"
Roohparvar, former President of DigitalOptics Corporation ("DOC"), and Richard
Chernicoff, former President of Intellectual Property and Micro-Electronics
Division, both of whom departed the Company within the pastsix months and
approximately just eighteen months after joining Tessera. This is further
evidence of significant turmoil and frustration with the leadership of the
Company.

We believe these facts, along with the analysis included in our First Letter,
point to significant failures on the part of the existing management team and
incumbent Board. They have failed to produce acceptable financial results;
they have failed to follow through on publicly stated commitments; they have
failed to create a healthy and productive environment where employees can
thrive and directors can properly oversee the Company; and they have failed to
create value for shareholders.

In order to protect and enhance value for all shareholders, on December 21,
2012, we nominated a slate of highly qualified director candidates for
election to the Board at the 2013 Annual Meeting. We followed up our
nomination notice with a detailed ten-page letter outlining our ideas
regarding opportunities for value creation at Tessera. We specifically urged
the Company to explore: (i) significantly reducing expenses throughout the
organization; (ii) implementing near-term performance hurdles and evaluating
alternative strategies for DigitalOptics Corporation ("DOC"); (iii) reducing
costs and growing revenue in the Intellectual Property ("IP") business; and
(iv) returning significant capital to shareholders. It was our hope that
management and the Board would thoroughly evaluate our views and take action
to address our concerns.

Instead, the Company responded to our First Letter just one day later on
February 20, 2013 in a press release that failed to address the serious issues
we raised and instead confirmed the Company's commitment to the status quo
strategy.

It appears that the incumbent Board and senior management of Tessera have no
interest in taking the necessary steps to effect needed change at Tessera and
are determined to keep the status quo. This is even more evident after
reading the resignation letter of Messrs. Rivette and Goodrich, who blame the
"current board leadership" for "prevent(ing) effective operating oversight,
effective cost control, strategic planning, profit and loss discipline,
economically rational strategies for our DOC initiatives and appropriate focus
on our core business." Interestingly, these criticisms are very similar to
the issues we raised and the changes for which we have lobbied over the past
year. It is unfortunate that the shareholders no longer enjoy the advocacy of
these Board members.

The deeply concerning contents of the director resignation letter, recent
executive departures, continued dismal operating performance, and poor
governance all further solidify our view that material change in board
composition, executive leadership, and corporate strategy are immediately
required at Tessera. To this end, we will be filing our proxy materials over
the coming weeks, and we will seek support from shareholders to replace a
majority of the current Board with highly-qualified director nominees.
Following the filing of our proxy materials, we will be sharing more
information on our plans for the Company, each of its businesses, and our
strategy to unlock substantial value for the benefit of all shareholders. As
one of the largest shareholders of Tessera, our interests are directly aligned
with yours and we look forward to communicating with you throughout this
process.

Best Regards,

Peter A. Feld
Managing Member
Starboard Value

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

SOURCE Starboard Value LP

Website: http://www.starboardvalue.com
 
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