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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
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Preliminary Proxy Statement |
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Definitive Proxy Statement |
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Definitive Additional Materials |
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Soliciting Material Under Section 240.14a-12 |
INFOUSA INC.
(Name of Registrant as Specified in Its Charter)
N/A
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
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Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11. |
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and identify the filing for which the offsetting fee was paid previously. Identify the
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April 17, 2006
Dear Fellow infoUSA Stockholders:
As you may know, Dolphin Partners, a dissident, short-term
stockholder, has launched a hostile proxy contest in an attempt
to elect three of its own hand-picked nominees to the infoUSA
Board of Directors. We believe that the disruptive strategy of
Dolphin Partners a hedge fund that became a
stockholder just months ago is not consistent with
the creation of long-term value for all infoUSA stockholders.
In fact, we believe the dissident is trying to win
representation on the Board of Directors only to advance its own
misguided and self-serving agenda.
We urge you to disregard the dissidents materials and
the blue proxy card. We believe that the best way to
preserve and enhance the value of your infoUSA investment is to
support our three highly qualified nominees Vinod
Gupta, Dr. George Haddix and Dr. Vasant Raval, by
signing, dating and returning the enclosed WHITE PROXY CARD
today!
ELECT THE INCUMBENT DIRECTORS TO ENSURE
THAT YOUR BOARD CAN CONTINUE ITS SUCCESSFUL STRATEGY
TO ENHANCE VALUE FOR ALL STOCKHOLDERS
Your Board of Directors has been effectively enhancing
shareholder value by improving and expanding our operations as a
leading provider of business and consumer information, data
processing and database marketing services that are used by our
over four million small business users to generate sales leads
and sales growth. Since going public in 1992, we have worked
hard to dramatically improve the products and strategies of
infoUSA, through both organic growth and more than 20 successful
acquisitions.
The success of infoUSAs strategy is clearly evident in the
companys performance. infoUSA generated a 17.3% compound
annual revenue growth rate, increasing revenue from
$48.5 million in 1992 to more than $383 million in
2005. Over the past four years the successful execution of our
strategy has delivered a total return to our stockholders of
57.5% an average annual return of approximately
11.5%. This compares to a return of only 14.8% from the NASDAQ
index and a 7.4% decline in the S&P Data
Processing & Outsourcing Services Index over the same
four-year period. We have paid a cash dividend in each of the
past two years returning more than $12 million
to infoUSA stockholders in 2006 alone.
In addition to the Board and managements proven track
record of creating value for stockholders, we have also had
considerable success in the marketplace. We have remained an
industry leader by anticipating and adapting to changing market
conditions and have successfully shifted the companys
focus to e-mail
marketing and subscription based services while broadening
infoUSAs other offerings.
As the direct marketing industry experienced a shift away from
direct mail in favor of online advertising, infoUSA acted
quickly to secure a leadership position in
e-mail, search words
and banner advertising. infoUSA was the first to recognize the
value of e-mail
marketing for business solutions and, starting in March of 2002,
we acquired five e-mail
marketing companies DoubleClick, ClickAction,
Yesmail, Markado and @Once. Today, we have a robust
$26 million-plus
e-mail business and
these acquisitions have more than paid for themselves.
We have also effectively combated the loss of business due to
e-mail migration by
offering a bundled solution. This multi-channel approach gives
customers a one-stop solution that combines our data, data
processing, database marketing and
e-mail solutions. This
solution provides customers with superior products and gives us
the most pricing flexibility. We are able to do this because we
own the data, as well as the distribution network. By executing
our strategy of providing our customers with a one-stop
solution, we can proudly say that we can offer our customers
service that is unparalleled in our industry.
We continue to be an industry innovator, implementing new ideas
such as our highly successful subscription based strategy. We
have over four million people who utilize our
services this represents more than the total
customers of all of our competitors combined. InfoUSA wrote the
book on sales leads and sales growth for small businesses. Our
subscription based products including
SalesGenie.com, SalesLeadsUSA.com, Polk City Directory and
Credit.net products are a key element of our organic
growth strategy and create recurring revenue at a higher price
point than our one-time list sales. As a result of our
prudent management and the aggressive execution of our strategic
initiatives, infoUSA now has over 35,000 subscribers,
representing an annual contract value in excess of
$54 million.
Further to our goal of creating shareholder value, we have
entered new markets and significantly expanded our geographic
reach. We have also leveraged our databases to create new
markets in areas such government and politics, GPS navigation,
tax compliance and Homeland Security. We are pleased with our
progress on these initiatives and will continue to execute on
our strategic plan to grow our business and create even more
value for stockholders.
We are confident that the strategic plan developed by your Board
and management will continue to enhance value for infoUSA
stockholders by:
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Offering complete market solutions for large customers by
providing proprietary data, data processing services and email
marketing solutions |
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Converting to subscription pricing models:
SalesGenie.com, SalesLeadsUSA.com and Credit.net |
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Leveraging new distribution channels |
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Increasing branding and becoming the small business brand
of choice |
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Increasing operating leverage through consolidation of
back-end operations into one center in Omaha |
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Providing greater access to clients to increase use of
databases and data processing services |
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Providing additional compelling applications to small
business and SOHO marketplaces (e.g. SalesGenie) |
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Targeting high growth markets for the licensed databases
(e.g. recent success in the in-car navigation systems market) |
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Continuing our international expansion |
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Increasing customer base among millions of sales people
and small business owners |
DONT BE MISLED
WE BELIEVE THAT DOLPHIN AND ITS HAND-PICKED NOMINEES
REPRESENT ONLY DOLPHIN, NOT THE INTERESTS OF ALL infoUSA
STOCKHOLDERS
In contrast to your Board and management, the dissident group
offers no ideas for improving operations or growing the company.
We believe that election of their slate could interrupt the
implementation of our strategic plan and negatively impact
shareholder value. We do not believe that a forced sale
conducted without regard to market timing, as the dissident
seems to advocate, would produce as great a level of shareholder
value as the continued execution of our strategic plan.
Moreover, uncertainty caused by the dissidents intent to
put the company up for sale could cause customers to defect and
make it more difficult to attract new customers. Their
interference could also impede our efforts to attract and retain
talented employees in key positions.
We believe that the dissidents track record of
investing for quick and easy profits clearly shows that they
have never created value, only liquidated it. Dolphin, which
only became a stockholder in recent months, has nominated
individuals with no relevant operational experience and no plan
to enhance value for stockholders. We believe that Dolphin is
making personal accusations and other misleading suggestions in
an attempt to unduly influence the company in order to advance
its own agenda.
YOUR BOARD AND MANAGEMENT IS DEDICATED TO SOUND
CORPORATE GOVERNANCE AND HAS THE EXPERTISE AND THE
EXPERIENCE
TO CONTINUE TO BUILD VALUE FOR ALL STOCKHOLDERS
The infoUSA management team has the expertise to implement the
companys strategic plan. Led by Vinod Gupta, the founder
of the company, infoUSA been an innovator in a rapidly changing
industry while generating strong returns for stockholders.
Mr. Gupta owns more than 40% of the companys
outstanding shares, and other members of the senior management
team and the Board also have considerable holdings. Clearly, the
interests of management are aligned with those of all
stockholders.
Like the management team, your infoUSA Board is firmly committed
to enhancing value for ALL stockholders. infoUSA has continually
added highly-qualified members to the Board, and today 8 of
infoUSAs 9 directors are independent by
NASDAQs Corporate Governance Standards. As demonstrated by
the decision last year to reject the going private proposal, the
Board is independent and acts in the best interests of
stockholders.
Our Board values the input of all of our stockholders and takes
its fiduciary duties very seriously. We have considered the
dissidents requests for seats on the Board, but we believe
that the dissidents nominees only commitment is to its own
short-term agenda. Similarly, the Board recommends a vote
against the dissidents second proposal, which we believe
is invalid and counter to your best interests.
Our Board asks you to show your support of our incumbent
directors, Vinod Gupta, Dr. George Haddix and
Dr. Vasant Raval, by signing, dating and returning the
enclosed WHITE PROXY CARD today. Your vote is extremely
important, no matter how many or how few shares that you own. If
you have any questions or need any assistance in voting your
shares, please do not hesitate to contact our proxy solicitor,
MacKenzie Partners, Inc., at
1-800-322-2885.
Thank you very much for your continued support.
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On behalf of the Board of Directors, |
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Vinod Gupta |
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Chairman & Chief Executive Officer |
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infoUSA Inc. |