Starboard Files Definitive Proxy Materials to Elect Six Highly Qualified Director Nominees to the Board of Directors of Tessera

   Starboard Files Definitive Proxy Materials to Elect Six Highly Qualified
    Director Nominees to the Board of Directors of Tessera Technologies at
                           Upcoming Annual Meeting

Delivers Letter Urging Shareholders to Vote the WHITE Proxy Card Today to
Support the Best and Most Qualified Slate of Directors to Lead Tessera on the
Right Path Forward

PR Newswire

NEW YORK, April 17, 2013

NEW YORK, April 17, 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 7.6% of the outstanding common stock of the Company, announced
today that it has filed definitive proxy materials with the Securities and
Exchange Commission in connection with the Company's 2013 Annual Meeting and
has delivered a letter to the shareholders of Tessera.

Starboard is urging shareholders to elect its six highly qualified nominees,
Tudor Brown, George Cwynar, Peter A. Feld, Tom Lacey, George Riedel and Don
Stout, to serve on the Company's board of directors at the upcoming 2013
Annual Meeting.

The full text of the letter follows:

April 17, 2013

Dear Fellow Tessera Technologies Shareholders:

It is Time for a New Plan and a New Board at Tessera

Our Interests Are Directly Aligned with ALL Shareholders

Vote the WHITE Proxy Card Today to Support the Best and Most Qualified Slate
of Directors to Oversee Tessera

Starboard Value LP, together with its affiliates ("Starboard"), currently owns
approximately 7.6% of the outstanding common shares of Tessera Technologies,
Inc. ("Tessera" or the "Company"), making us one of the Company's largest
shareholders. Over the past eighteen months, we have been working hard on
behalf of all Tessera shareholders to push for value enhancing changes that we
believe are required in order to realize full and fair value for all Tessera
shareholders. For most of this time, our efforts to effect positive change at
Tessera have been purposely frustrated by ongoing manipulation of Tessera's
corporate governance machinery and our recommendations for value-enhancing
initiatives have been largely ignored. With the 2013 Annual Meeting (the
"Annual Meeting") now just one month away and the Company at a critical
juncture in light of recent events and historically poor performance,
Tessera's shareholders finally have the opportunity to elect a new set of
directors to lead Tessera on the right path forward.

We have nominated a slate of six individuals for election at the Annual
Meeting who we believe are highly-qualified, have the requisite skill sets
that are directly relevant to Tessera's businesses, and are truly independent.
We believe the election of this new slate of director nominees is crucial to
Tessera's success, as it has become increasingly clear to us, and we believe
to many of you as well, that Tessera is broken and its current business plan
has failed. In the Company's core IP business ("IP"), revenues have declined
over the past three years while expenses have ballooned. In the Company's
DigitalOptics business ("DOC"), the Company has repeatedly failed to achieve
its stated performance goals despite heavy spending and new revenue streams
have proven elusive. DOC is hemorrhaging cash and swift action must be taken
to preserve and unlock value in this business venture.

Collectively, our director nominees have superior credentials to those of the
Company's nominees and backgrounds that are directly relevant to both of
Tessera's business units. Our director nominees have also been working
diligently in conjunction with Starboard and our advisors to create a new
business plan for Tessera that we strongly believe will result in dramatically
improved financial results. The development of this plan is well underway and
we expect to share further details of this plan in an extensive Investor
Presentation within the next two weeks. The basic, preliminary tenets of the
plan include:

  oRefocusing Tessera on becoming a "technology licensing" company, NOT a
    "research and design" company;

  oRealizing the full licensing value of Tessera's current patent assets
    across multiple industries through expanded licensing and assertion
    efforts;

  oEvaluating partnerships for DOC that would allow Tessera to exit the
    design, manufacturing, and sales responsibilities for these products while
    retaining upside through equity ownership or per unit royalties;

  oRetaining DOC intellectual property and beginning a licensing effort to
    realize revenues from this valuable portfolio;

  oExploring industry partnerships and small tuck-in acquisitions to expand
    on Tessera's core intellectual property assets in order to grow revenue
    and extend the life of the portfolio;

  oReducing costs significantly across all functional areas of Tessera,
    including IP, DOC, and corporate overhead;

  oDelivering improved revenue growth and achieving best-in-class EBITDA
    margins of up to 60% to 70% in the medium to long-term; and

  oReturning excess capital to shareholders through a combination of
    increased quarterly dividends, special dividends, and share buyback
    programs.

The nominees we have proposed for election at the Annual Meeting have what it
takes to successfully oversee the execution of these aggressive plans and to
return Tessera to prominence. Each of these nominees was carefully selected
based upon his specific expertise in areas pertinent to Tessera, his track
record of prior performance, and his true independence from current and former
members of Tessera's management and the Board. This new slate is the result
of a thorough two-month search process utilizing our internal network of
relationships as well as a tier one executive search firm. The result was
five truly remarkable candidates, four of whom we had no contact with prior to
the start of our search. Additionally, if elected, I plan to serve on the
Board as a representative of one of Tessera's largest shareholders. Our
non-Starboard nominees include:

Tudor Brown was one of the founding members and until May 2012, President and
Board Member of ARM Holdings plc, a publicly-traded, semiconductor IP and
software design company based in Cambridge, UK, where he served in various
positions over a career of more than twenty years. ARM Holdings plc currently
has a market value of nearly $20 billion and is one of the most successful
semiconductor IP licensing companies in the world. Prior to our search for
Tessera director candidates, Starboard had no previous relationship with Mr.
Brown.

George Cwynar is the former President, Chief Executive Officer, and Board
Member of MOSAID Technologies Incorporated, a Canadian-based leading designer
and licensor of memory technology, and supplier of memory test systems to
major semiconductor companies worldwide. During his tenure at MOSAID, Mr.
Cwynar managed the delicate balance between intellectual property licensing
and product sales. He is uniquely positioned to understand the complications
Tessera faces by participating in both the semiconductor IP licensing business
and technology components business. Prior to our search for Tessera director
candidates, Starboard had no previous relationship with Mr. Cwynar.

Thomas Lacey previously served as the President of Flextronics International's
Components Division, now Vista Point Technologies, from which Tessera acquired
camera module manufacturing assets integral to its DOC business segment. Mr.
Lacey has a broad knowledge of the technology components business and is
uniquely qualified due to his specific knowledge of elements of Tessera's DOC
business. Earlier in his career, Mr. Lacey held various management and
executive positions at Intel Corporation for 13 years, including Vice
President Sales and Marketing, President of Intel Americas, and Vice President
and General Manager, Flash Products. Starboard initially met Mr. Lacey
through its investment in Phoenix Technologies, a former Starboard portfolio
company, where he was hired to be the CEO. Following the sale of Phoenix
Technologies, Starboard recommended Mr. Lacey for a board opportunity at a
current Starboard portfolio company, DSP Group. Mr. Lacey is a current
director of DSP Group.

George A. Riedel previously served in various positions with Nortel Networks
Corporation, where he led the sale/restructuring of various carrier and
enterprise business units, and later on, led the effort to monetize the
company's remaining 6,500 patents and patent applications, culminating in the
sale of its patent portfolio for $4.5 billion to a consortium which included
several of the leading technology companies in the world. This is one of the
largest single transactions for intellectual property ever completed. Prior
to our search for Tessera director candidates, Starboard had no previous
relationship with Mr. Riedel.

Donald E. Stout is a senior partner at the law firm of Antonelli, Terry, Stout
& Kraus, LLP, where his legal practice has involved all facets of intellectual
property licensing, litigation, and general patent work. Mr. Stout co-founded
NTP Inc., a very successful patent holding company for which he prepared the
original patents and managed its patent litigation strategy, and currently
serves as its Chief Strategist. Prior to our search for Tessera director
candidates, Starboard had no previous relationship with Mr. Stout.

In stark contrast to the exemplary credentials of our proposed nominees, the
Company's slate appears to have been hastily constructed, and we believe is
poorly equipped to oversee and govern Tessera. The Company's nominees include
three legacy directors, Richard Hill, David Nagel, and Timothy Stultz, and
three newly-appointed directors, John Chenault, John Miner, and Christopher
Seams.

With respect to the legacy directors, Dr. Nagel has been on the Board since
September 2005, during which period Tessera's stock price has declined by over
40% despite a 50% increase in the S&P 500, representing underperformance of
greater than 90%[1]. We question why Dr. Nagel deserves to be nominated for
re-election in light of the Company's dismal performance during his tenure and
the limited relevance of his background to Tessera's current businesses.
Messrs. Hill and Stultz joined the Board approximately eight months ago and
while not to blame for the many years of terrible performance at Tessera, they
are responsible, in part, for the Board's recent poor decision-making,
including:

  oThe Company's manipulation of its corporate governance mechanics in
    delaying the Annual Meeting to two months after the anniversary of last
    year's annual meeting, and thereby preventing shareholders from exerting
    their rights to elect directors on a timely basis and during a critical
    time for the Company;

  oThe Board's acceptance of the resignations of former directors Goodrich
    and Rivette following the serious and alarming accusations made in their
    resignation letter regarding former Chairman Robert Boehlke, when just
    weeks later the Board replaced Mr. Boehlke as Chairman and decided not to
    nominate him for re-election to the board;

  oThe Board's public statement of unanimous support for the Company's former
    CEO, Dr. Robert Young, when only weeks later the Board replaced him as CEO
    and decided not to nominate him for re-election to the Board;

  oThe Company's entirely discretionary and excessive award to former CEO
    Young of (i) $1.3 million in a lump-sum cash "separation" payment; and
    (ii) a two-year consulting arrangement with the Company allowing all of
    his vested equity awards to remain exercisable for that period. We
    estimate the value of this extension to be in excess of $300,000 based on
    a Black-Scholes calculation. In return for these payments and extensions,
    Dr. Young has agreed to vote in favor of the Company's slate at the Annual
    Meeting;

  oThe Company's continued poor financial performance, bloated costs, missed
    expectations, and minimal reactionary measures taken to date to improve
    results; and

  oThe Board's appointment of three new directors who appear to have minimal
    relevant experience, and two of whom have ties to Interim CEO and
    Executive Chairman Hill.

With respect to the newly-appointed directors on the Company's slate, none of
them has directly relevant experience in IP licensing or imaging technology
components businesses. Tessera is primarily an IP licensing company, yet
these individuals have backgrounds in semiconductor capital equipment, venture
capital, and semiconductor products. How does that make any sense? In the
Company's proxy materials, the Company states; "The three new independent
directors, Messrs. Chenault, Miner and Seams, were each recommended to the
Board and the Nominating Committee by Michael Reich & Associates, a third
party search firm." Yet, a review of their backgrounds reveals that Mr.
Chenault served in several roles under Interim CEO and Executive Chairman Hill
at Novellus for more than ten years prior to his retirement in 2005, and Mr.
Miner currently serves on the board of LSI Corp alongside Mr. Hill. Are we
really expected to believe that these individuals with past ties to Mr. Hill
and who clearly lack directly relevant business experience just happened to be
identified by this third party search firm as the best candidates available?
We cannot see this as a coincidence and seriously question the qualifications
of Messrs. Chenault, Miner, and Seams and the process by which they were
appointed to the Board.

Looking at the Company's slate in totality, there is an alarming lack of
relevant experience in Tessera's businesses. Not a single candidate has run
an IP licensing business, is a patent attorney, has direct experience in
imaging technology components, or owns a material stake in Tessera. When given
the opportunity to hand-pick three new directors, the Board appears to have
chosen individuals close to Interim CEO and Executive Chairman Hill instead of
individuals with the necessary experience to turn the Company around. This
apparent consolidation of power under Mr. Hill is reminiscent of the
problematic behaviors that kept the former Board from re-examining its failed
strategies despite years of terrible performance under the leadership of
former Chairman Boehlke.

Despite our steadfast view that the slate of nominees we have proposed is
better, more qualified, and more independent than the Company's slate, we
recognize that a certain amount of continuity on the Board may be beneficial.
For this reason, our nominees have expressed their willingness to expand the
Board to consider adding back up to two incumbent directors and, once a new
permanent CEO has been appointed to succeed Mr. Hill, to add the Company's new
permanent CEO to the Board. We believe this would allow Tessera to move
forward under the leadership of new, well-qualified directors, while ensuring
continuity at the Company.

Ultimately, we are encouraged that, as a result of our ongoing involvement and
the pressure of the pending election contest, the Company finally agrees that
it is time for substantial changes to the Company's management, Board, and
strategic direction. However, our work here has just begun. The steps taken
to date fall well short of the actions necessary to put Tessera back on track
for long-term value creation.

The next step should be for the Company's shareholders to elect the best
possible slate of director nominees at the Annual Meeting to oversee and
govern Tessera going forward. We do not view this contest as being about
"majority" or "control." Instead, it is about which group of director
nominees is most qualified to lead Tessera through the transition away from
its failed strategies and back on the path towards value creation.

Now it is up to Tessera's shareholders to choose the best individuals to lead
the Company forward. We ask that each of you review the qualifications of the
two respective slates of director nominees and determine for yourself whom you
believe is most qualified to represent your interests on the Board. As one of
Tessera's largest shareholders, we believe the choice is clear.

Our interests are directly aligned with yours, and we continue to believe that
there is significant value to be realized at Tessera. Starboard has a long
history of investing in undervalued and underperforming public companies and
identifying and executing on opportunities to unlock value for the benefit of
all shareholders. We want what is best for Tessera and its shareholders and
will endeavor to represent all of our interests in the boardroom in order to
protect and maximize value.

VOTE FOR A NEW PLAN AND A NEW BOARD AT TESSERA

PLEASE SIGN, DATE, AND MAIL THE ENCLOSED WHITE PROXY CARD TODAY

We look forward to your support at the Annual Meeting.

Best Regards,

Peter A. Feld
Managing Member
Starboard Value

[1] David Nagel joined the board of Tessera on September 7, 2005. Performance
numbers are based on total returns including all dividends from the closing
price on September 6, 2005 to April 12, 2013.

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
 
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