<PAGE> 1
SCHEDULE 14A
(RULE 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE
SECURITIES EXCHANGE ACT OF 1934
Filed by the registrant [X]
Filed by a party other than the registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or
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)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required
[ ] $125 per Exchange Act Rules O-11(c)(1)(ii), 14a-6(i)(1),
14a-6(i)(2) or Item 22(a)(2) of Schedule 14A.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1)
and 0-11.
(1) Title of each class of securities to which
transaction applies:
(2) Aggregate number of securities to which transactions
applies:
(3) Per unit price or other underlying value of
transaction computed pursuant to Exchange Act Rule
0-11 (set forth the amount on which the filing fee
is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by
Exchange Act Rule 0-11(a)(2) and identify the filing for which
the offsetting fee was paid previously. Identify the previous
filing by registration statement number, or the Form or
Schedule and the date of its filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
<PAGE> 2
[infoUSA LOGO]
infoUSA INC.
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
APRIL 28, 2000
TO THE STOCKHOLDERS:
NOTICE IS HEREBY GIVEN that the 2000 Annual Meeting of Stockholders of
infoUSA Inc., a Delaware corporation (the "Company"), will be held on Friday,
April 28, 2000, at 10:00 a.m. local time, at the Company's Database and
Technology Center, 1020 East 1st Street, Papillion, Nebraska 68046, for the
following purposes as more fully described in the Proxy Statement accompanying
this Notice:
1. To elect two directors to the Board of Directors for a term of
three years;
2. To ratify the appointment of KPMG LLP as the Company's independent
public accountants for the fiscal year ending December 31, 2000; and
3. To transact such other business as may properly come before the
meeting or any adjournment thereof.
Only stockholders of record at the close of business on March 17, 2000 are
entitled to receive notice of and to vote at the meeting.
ALL STOCKHOLDERS ARE CORDIALLY INVITED TO ATTEND THE ANNUAL MEETING IN
PERSON. HOWEVER, TO ASSURE YOUR REPRESENTATION AT THE ANNUAL MEETING, YOU ARE
URGED TO MARK, SIGN, DATE AND RETURN THE ENCLOSED PROXY CARD AS PROMPTLY AS
POSSIBLE IN THE POSTAGE-PREPAID ENVELOPE INCLUDED FOR THAT PURPOSE. STOCKHOLDERS
ATTENDING THE ANNUAL MEETING MAY VOTE IN PERSON EVEN IF THEY HAVE RETURNED A
PROXY.
Sincerely,
/s/ FRED VAKILI
FRED VAKILI
Secretary
Omaha, Nebraska
March 27, 2000
<PAGE> 3
infoUSA INC.
---------------------
PROXY STATEMENT
---------------------
INFORMATION CONCERNING SOLICITATION AND VOTING
GENERAL
The enclosed Proxy is solicited on behalf of infoUSA Inc., a Delaware
corporation (the "Company"), for use at its 2000 Annual Meeting of Stockholders
to be held on Friday, April 28, 2000, at 10:00 a.m., local time, or at any
adjournments or postponements thereof, for the purposes set forth in this Proxy
Statement and in the accompanying Notice of Annual Meeting of Stockholders. The
Annual Meeting will be held at the Company's Database and Technology Center,
1020 East 1st Street, Papillion, Nebraska 68046. The Company's principal
executive offices are located at 5711 South 86th Circle, Omaha, Nebraska 68127.
The Company's telephone number is (402) 593-4500.
These proxy solicitation materials were mailed on or about March 27, 2000
to all stockholders entitled to vote at the meeting. The Company's Annual Report
for the fiscal year ended December 31, 1999, including audited financial
statements, is being mailed to stockholders concurrently with this Proxy
Statement.
RECORD DATE; OUTSTANDING SHARES
Stockholders of record at the close of business on March 17, 2000 (the
"Record Date") are entitled to receive notice of and vote at the meeting. On the
Record Date, 49,838,408 shares of the Company's Common Stock, $.0025 par value
per share, were issued and outstanding. For information regarding holders of
more than five percent of the outstanding Common Stock, see "Security
Ownership."
REVOCABILITY OF PROXIES
Proxies given pursuant to this solicitation may be revoked at any time
before they have been voted. Revocation will occur by delivering a written
notice of revocation to the Company or by duly executing and delivering to the
attention of the Secretary of the Company a proxy bearing a later date.
Revocation will also occur if the stockholder attends the meeting and votes in
person.
VOTING AND SOLICITATION
The presence in person or by proxy of holders of a majority of the shares
of stock entitled to vote at the Annual Meeting constitutes a quorum for the
transaction of business. Every holder of record of Common Stock on the Record
Date is entitled, for each share held, to one vote on each proposal or item that
comes before the meeting. In the election of directors, each stockholder will be
entitled to vote for two nominees and the two nominees with the greatest number
of votes will be elected.
The election inspectors will treat abstentions as shares that are present
and entitled to vote for purposes of determining whether a quorum is present.
With respect to the election of directors (elected by a plurality of the votes),
abstentions will not be taken into account in determining the outcome of the
election. With respect to the other matters being considered (approved by a
majority of the shares represented at the Annual Meeting and entitled to vote),
abstentions will have the same effect as negative votes. If a broker indicates
on the proxy that it does not have discretionary authority as to certain shares
to vote on a particular matter, those shares will not be considered as present
and entitled to vote with respect to that matter and will not be taken into
account in determining the outcome of the votes on that matter.
The cost of this solicitation will be borne by the Company. The Company may
reimburse expenses incurred by brokerage firms and other persons representing
beneficial owners of shares in forwarding solicitation material to beneficial
owners. Proxies may be solicited by certain of the Company's directors, officers
and regular employees personally, by telephone or by telegram and no additional
compensation will be paid to such individuals.
1
<PAGE> 4
DEADLINES FOR RECEIPT OF STOCKHOLDER PROPOSALS
The proxy rules of the Securities and Exchange Commission permit
stockholders, after timely notice to a company, to present proposals for
stockholder action in a company's proxy statement where such proposals are
consistent with applicable law, pertain to matters appropriate for stockholder
action and are not properly omitted by corporate action in accordance with the
proxy rules. Stockholder proposals that are intended to be presented at the
Company's 2001 Annual Meeting must be received by the Company no later than
November 28, 2000 to be included in the proxy statement and form of proxy for
that meeting. The Company's proxy for the 2001 Annual Meeting may confer on the
proxy holder discretionary authority to vote on any Stockholder proposals that
are intended to be presented at the Company's 2001 Annual Meeting that are
received after February 11, 2001.
The Company's Bylaws provide that certain requirements be met in order that
business may properly come before the stockholders at the Annual Meeting. Among
other things, stockholders intending to bring business before the Annual Meeting
must provide written notice of such intent to the Secretary of the Company. Such
notice must be received by the Company no later than the close of business on
the 10th day following the date of this Proxy Statement. Stockholders desiring
to bring matters for action at an Annual Meeting should contact the Company's
Secretary for a copy of the relevant requirements. Any stockholder wishing to
bring matters for action at this year's Annual Meeting should note that, as
permitted by the proxy rules, the persons named as proxies may exercise
discretionary voting authority with respect to any such proposal because the
proposals will have been received after February 19, 2000 (as disclosed in the
Proxy Statement for the 1999 Annual Meeting).
2
<PAGE> 5
PROPOSAL ONE
ELECTION OF DIRECTORS
GENERAL
The Company's Board of Directors is divided into three classes, two of
which have two directors and one of which has three directors, with the term of
office of one class expiring each year. The terms of office of directors Vinod
Gupta and George F. Haddix expire at this year's Annual Meeting. The terms of
office of directors Harold W. Andersen and Elliot S. Kaplan expire at the 2001
Annual Meeting and the terms of office of directors Paul A. Goldner, Charles T.
Fote and E. Benjamin Nelson expire at the 2002 Annual Meeting. The Company is
proposing that stockholders re-elect the two directors whose term expires this
year (Messrs. Gupta and Haddix) for a term expiring at the 2003 Annual Meeting.
George I. Kubat, Gautam Gupta and Jon Hoffmaster resigned as directors in
1999. Charles T. Fote was appointed to the seat left vacant by George I. Kubat.
E. Benjamin Nelson was appointed to the seat left vacant by Gautam Gupta.
VOTE REQUIRED
The two nominees receiving the highest number of affirmative votes of the
shares present in person or represented by proxy at the Annual Meeting and
entitled to vote on the election of directors shall be elected to the Board of
Directors.
Unless otherwise instructed, the proxy holders will vote the proxies
received by them for the Company's two nominees named below, both of whom are
presently directors of the Company. If any nominee of the Company is unable or
declines to serve as a director at the time of the Annual Meeting, the proxies
will be voted for any nominee who is designated by the present Board of
Directors to fill the vacancy. It is not expected that any nominee will be
unable or will decline to serve as a director.
THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS VOTE "FOR" EACH NOMINEE
LISTED BELOW.
NOMINEES FOR ELECTION AT THE ANNUAL MEETING
The names of the nominees, and certain information about them, are set
forth below:
<TABLE>
<CAPTION>
NOMINATED
FOR TERM DIRECTOR
NAME OF NOMINEE AGE POSITION/PRINCIPAL OCCUPATION EXPIRING SINCE
- --------------- --- ----------------------------- --------- --------
<S> <C> <C> <C> <C>
Vinod Gupta................ 53 Chairman of the Board and Chief Executive
Officer of the Company. 2003 1972
George F. Haddix(1)(2)..... 61 Director; Individual Investor. 2003 1995
</TABLE>
- ---------------
(1) Member of the Audit Committee.
(2) Member of the Compensation Committee.
Vinod Gupta is the founder of the Company, has been Chairman of the Board
of the Company since its incorporation in 1972 and was named Chief Executive
Officer effective August 1, 1998. Mr. Gupta previously served as Chief Executive
Officer of the Company from the time of its incorporation in 1972 until
September 1997. Mr. Gupta holds a B.S. in Engineering from the Indian Institute
of Technology, Kharagpur, India, and an M.S. in Engineering and an M.B.A. from
the University of Nebraska.
George F. Haddix has served as a director of the Company since March 1995.
Since January 1998, Mr. Haddix has been an individual investor. From November
1994 to December 1997, Mr. Haddix served as President of CSG Holdings, Inc. and
CSG Systems International, Inc., companies providing software and information
services to the communications industry. Mr. Haddix is a director of CSG Systems
Interna-
3
<PAGE> 6
tional, Inc. From 1989 until joining CSG in November 1994, Mr. Haddix was an
individual investor. Mr. Haddix holds a B.A. from the University of Nebraska, an
M.A. from Creighton University and a Ph.D. from Iowa State University, all in
Mathematics.
INCUMBENT DIRECTORS WHOSE TERMS OF OFFICE CONTINUE AFTER THE ANNUAL MEETING
The names and certain other information about the directors whose terms of
office continue after the Annual Meeting are set forth below:
<TABLE>
<CAPTION>
DIRECTOR TERM
NAME OF DIRECTOR AGE POSITION/PRINCIPAL OCCUPATION SINCE EXPIRES
- ---------------- --- ----------------------------- -------- -------
<S> <C> <C> <C> <C>
Harold W. Andersen(1)(2)... 76 Director; Contributing Editor to Omaha 1993 2001
World Herald and Retired Publisher
of Omaha World Herald Company.
Elliot S. Kaplan (2)....... 63 Director; Senior Partner in law firm 1988 2001
of Robins, Kaplan, Miller & Ciresi
L.L.P.
Paul A. Goldner............ 65 Director; Consultant to the Company. 1997 2002
E. Benjamin Nelson(1)...... 58 Director; Former Governor of Nebraska. 1999 2002
Charles T. Fote............ 51 Director; President and Chief 1999 2002
Operating Officer of First Data
Corporation.
</TABLE>
- ---------------
(1) Member of the Audit Committee.
(2) Member of the Compensation Committee.
Harold W. Andersen has served as director of the Company since September
1993. He is the former President, Chief Executive Officer, Chairman and
Publisher of the Omaha World Herald Company, a newspaper publishing company. Mr.
Andersen is currently a Contributing Editor to the Omaha World Herald. Mr.
Andersen holds a B.S. in Liberal Arts from the University of Nebraska.
Elliot S. Kaplan has served as director of the Company since May 1988. He
is a name partner and former Chairman of the Executive Board of the law firm of
Robins, Kaplan, Miller & Ciresi L.L.P. and has practiced law continuously with
that firm since 1962. Mr. Kaplan is also a director and officer of Best Buy Co.,
Inc., and a director of The Franklin Corporation. Mr. Kaplan holds a B.A. in
Business Administration and a J.D. from the University of Minnesota.
Paul A. Goldner has served as a director of and consultant to the Company
since the acquisition of Database America ("DBA") in February 1997. He was a
founder of DBA, and served as its Chairman and Chief Executive Officer from 1973
to February 1997. Mr. Goldner holds a B.S. in Management Engineering from the
Rensselaer Polytechnic Institute. Mr. Goldner was appointed to the Board and
nominated for election as a director in connection with last year's Annual
Meeting pursuant to the terms of the employee and consulting agreement he signed
with the Company in connection with the DBA acquisition in 1997.
E. Benjamin Nelson has served as a director of the Company since March
1999. Since 1999, he has served as of counsel to Lamson, Dugan & Murray, a law
firm in Omaha, Nebraska. He is the former Governor of Nebraska, first elected in
1990 and then re-elected to a second term in 1994. He holds a B.A. and M.A. in
Philosophy, and a J.D. from the University of Nebraska.
Charles T. Fote has served as a director of the Company since July 1999.
Since September 1998, he has served as President and Chief Operating Officer of
First Data Corporation ("FDC"), an electronic payment services company. He
served as FDC's Executive Vice President from its initial public offering in
April 1992 until September 1998. He also served as a director of FDC from the
time of its formation as a subsidiary of American Express Company until April
1992.
4
<PAGE> 7
BOARD MEETINGS AND COMMITTEES
The Board of Directors of the Company held a total of ten meetings during
1999. The Board of Directors has an Audit Committee and a Compensation
Committee. The Board does not have a nominating or any committee performing
similar functions.
The Audit Committee, which currently consists of directors E. Benjamin
Nelson (Chair), George F. Haddix and Harold W. Andersen, met four times in 1999.
This committee has primary responsibility for approving the services performed
by the Company's independent auditors and for reviewing and evaluating the
Company's accounting principles and its system of internal accounting controls.
The Compensation Committee, which currently consists of directors Harold W.
Andersen, George F. Haddix and Elliot S. Kaplan, met twice during 1999. This
committee has been delegated the duties of administering existing and future
stock and option plans of the Company, including the Company's 1992 Stock Option
Plan and the Company's 1997 Stock Option Plan, and establishing the compensation
of the Company's executive officers.
No director attended fewer than 75% of the aggregate of the total number of
meetings of the Board of Directors and the total number of meetings held by all
committees of the Board of Directors on which he served, except Mr. Fote who did
not attend two Board meetings during his tenure as a director in 1999.
BOARD COMPENSATION
During 1999, non-employee directors were compensated at a rate of $2,500
per Board meeting attended. Employee directors do not receive compensation for
their service on the Board. In addition, during 1999, Messrs. Andersen, Fote,
Goldner, Haddix, Kaplan and Nelson were each granted an option to purchase
25,000 shares of Common Stock at an exercise price of $6.00 per share (the fair
market value on the date of grant), which were 100% vested at the time of grant.
Mr. Fote was granted an option to purchase 10,000 shares of Common Stock at an
exercise price of $7.00 (fair market value on the date of grant), which was 100%
vested at the time of grant. Mr. Nelson was granted an option to purchase 10,000
shares of Common Stock at an exercise price of $7.63 (fair market value on the
date of grant), which was 100% vested at the time of grant. In addition, Messrs.
Andersen, Goldner, Haddix, Kaplan and Kubat were each granted an option to
purchase 12,000 shares of Common Stock and Mr. Nelson was granted an option to
purchase 6,000 shares of Common Stock at an exercise price of $7.00 per share
(fair market value on the date of grant), all of which options vest in equal
increments of 25% over a period of four years.
5
<PAGE> 8
SECURITY OWNERSHIP
The following table sets forth the beneficial ownership of the Company's
Common Stock as of the Record Date (i) by each of the executive officers named
in the table under "Executive Compensation -- Summary Compensation Table," (ii)
by each director, (iii) by all current directors and executive officers as a
group and (iv) by all persons known to the Company to be the beneficial owners
of more than 5% of the Company's Common Stock:
<TABLE>
<CAPTION>
PERCENT OF
COMMON STOCK OUTSTANDING SHARES
BENEFICIAL OWNERS BENEFICIALLY OWNED(1) OF COMMON STOCK
- ----------------- --------------------- ------------------
<S> <C> <C>
Vinod Gupta....................................... 19,259,990 37.4%
5711 South 86th Circle
Omaha, NE 68127
FMR Corp. ........................................ 3,560,000 7.1%
82 Devonshire Street
Boston, Massachusetts 02109
Wanger Asset Management........................... 2,740,000 5.5%
227 West Monroe Street, Suite 3000
Chicago, Illinois 60606-5016
Paul A. Goldner................................... 1,098,544 2.2%
100 Paragon Drive
Montvale, New Jersey 07645
George F. Haddix.................................. 113,916 **
Harold W. Andersen................................ 90,016 **
Elliot S. Kaplan.................................. 199,096 **
E. Benjamin Nelson................................ 45,000 **
Charles T. Fote................................... 35,000 **
William J. Chasse................................. 387,248 **
William L. Kerrey................................. 111,057 **
Monica Messer..................................... 485,616 **
Susan L. Henricks................................. 5,122 **
All officers and directors as a group (15
persons)........................................ 22,274,332 42.0%
</TABLE>
- ---------------
** Less than 1%
(1) Includes the following shares which may be purchased within 60 days from the
date hereof pursuant to the exercise of outstanding options: Mr. Gupta,
1,724,582 shares; Mr. Goldner, 247,000 shares; Mr. Haddix, 41,416 shares;
Mr. Andersen, 41,416 shares; Mr. Kaplan, 47,416 shares; Mr. Nelson, 35,000
shares; Mr. Fote, 35,000 shares; Mr. Chasse, 386,248 shares; Mr. Kerrey,
83,111 shares; Ms. Messer, 216,248 shares and all officers and directors as
a group, 3,157,434 shares.
6
<PAGE> 9
PROPOSAL TWO
RATIFICATION OF APPOINTMENT OF INDEPENDENT PUBLIC ACCOUNTANTS
Management has selected KPMG LLP, independent accounts, to audit the books,
records and accounts of the Company for the current fiscal year ending December
31, 2000. KPMG LLP has audited the Company's financial statements since October
14, 1998.
The affirmative vote of the holders of a majority of the votes cast at the
meeting will be required to approve and ratify the Board's selection of KPMG
LLP. In the event of a negative vote on such ratification, the Board of
Directors will reconsider its selection.
A representative of KPMG LLP is expected to be present at the Annual
Meeting and will be available to respond to appropriate questions.
THE BOARD OF DIRECTORS RECOMMENDS VOTING "FOR" APPROVAL AND RATIFICATION OF
SUCH SELECTION.
RECENT CHANGES IN ACCOUNTANTS
On October 1, 1998, PricewaterhouseCoopers LLP, the Company's independent
accountants (the "Former Accountants") resigned from their engagement as
principal accountants for the Company due to their inability to satisfy the
"independence" requirement. The Former Accountants' resignation was required
because of the promotion of the son-in-law of one of the Company's directors to
an officer position at PricewaterhouseCoopers' Omaha office. On October 12,
1998, the Company engaged the services of KPMG LLP (the "New Accountants") to
serve as the Company's principal accountants for the fiscal year ending December
31, 1998. The decision to change accountants was not recommended or approved by
the Company's board of directors, nor by its audit committee. The Company's
stockholders ratified the appointment of the New Accountants at the Company's
Annual Meeting of Stockholders on May 2, 1999.
The reports of the Former Accountants for the fiscal year 1997 contained no
adverse opinion, disclaimer of opinion or opinion that was qualified or modified
as to uncertainty, audit scope or accounting principles. The report of the New
Accountants for the fiscal years 1999 and 1998 also did not contain an adverse
opinion, disclaimer of opinion or opinion that was qualified or modified as to
uncertainty, audit scope or accounting principles.
From January 1, 1998 through October 1, 1998, there were no disagreements
with the Former Accountants on any matter of accounting principles or practices,
financial statement disclosure, or auditing scope or procedure, which, if not
resolved to the satisfaction of the Former Accountants, would have caused them
to make reference thereto in their report on the financial statements of such
years.
From January 1, 1998 through October 1, 1998, none of the events listed in
paragraphs (A) through (D) of Item 304(a)(1)(v) of Regulation S-K occurred
except as follows. The Form 10-Q, filed by the Company for the period ended June
30, 1998, disclosed that the Company was in the process of performing a
valuation analysis of its acquisition of JAMI and any changes to its preliminary
estimates of the assets acquired, liabilities assumed and goodwill and other
intangibles recorded as part of the purchase, including an assessment of
purchased in-process research and development costs would be recorded in the
third quarter of 1998. The Former Accountants indicated that if such in-process
research and development charge was material, the financial statements for the
period ended June 30, 1998 would require restatement. Consistent with its
quarterly report on Form 10-Q for the quarter ended June 30, 1998, the Company
does not expect that any such in-process research and development costs will be
material. In addition, as a result of recent financial management resignations,
the Former Accountants advised the Company that it intended to expand the scope
of its audit testing for the fiscal year 1998 audit, and management is in
agreement with this advice.
In September 1998, the Company engaged the New Accountants for purposes of
allocating the cost of the acquisition to certain assets and liabilities
acquired by the Company from JAMI Marketing in May 1998. The Company
subsequently determined that there was no in-process research and development
charge in
7
<PAGE> 10
connection with the acquisition. The New Accountants had expressed in writing
their preliminary view that there should not be a material charge for in process
research and development costs as a result of the JAMI Marketing transaction.
The Company's Former Accountants, were not consulted by the Company regarding
the allocation of the acquisition costs. Other than as described above, during
the past two fiscal years and through the filing hereof, the Company has not
consulted with the New Accountants on either the application of accounting
principles to a specified transaction, or any matter that was the subject of a
reportable event discussed above.
The Company requested that PricewaterhouseCoopers LLP and KPMG LLP furnish
it with letters stating any disagreements that either firm had with the above
statements. Such letter from the Former Accountants was filed as an exhibit to
the Company's amended current report on Form 8-K filed with the SEC on October
14, 1998. No such letter was submitted by the New Accountants.
8
<PAGE> 11
PERFORMANCE GRAPH
The following Performance Graph compares the cumulative total return to
stockholders of the Company's Common Stock from December 31, 1994 to December
31, 1999 to the cumulative total return over such period of (i) The Nasdaq Stock
Market (U.S. Companies) Index and (ii) Chase H&Q Technology Index. The
information contained in the Performance Graph shall not be deemed to be
"soliciting material" or to be "filed" with the Securities and Exchange
Commission (the "SEC"), nor shall such information be incorporated by reference
into any future filing under the Securities Act of 1933, as amended (the
"Securities Act"), or the Securities and Exchange Act of 1934, as amended (the
"Exchange Act"), except to the extent that the Company specifically incorporates
it by reference into any such filing. The performance graph is not necessarily
indicative of future investment performance.
COMPARISON OF FIVE-YEAR CUMULATIVE TOTAL RETURN*
AMONG infoUSA INC., NASDAQ STOCK MARKET INDEX
AND CHASE H&Q TECHNOLOGY INDEX
PERFORMANCE GRAPH
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------
31-Dec-94 31-Dec-95 31-Dec-96 31-Dec-97 31-Dec-98 31-Dec-99
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
infoUSA Common Stock** 100 157 180 170 79 226
NASDAQ (U.S. Companies) 100 141 174 213 300 542
Chase H&Q Technology Index 100 150 186 218 339 757
</TABLE>
* Assumes $100 invested on December 31, 1994 in infoUSA Inc. Common Stock,
Nasdaq Stock Market (U.S. Companies) Index and Chase H&Q Technology Index.
The index designated as the Hambrecht & Quist Products and Services Index in
last year's proxy statement for the annual meeting of stockholders is the
same index as the Chase H&Q Technology Index.
** In October 1997, the Company reclassified its existing Common Stock as Class
B Common Stock, authorized a new class of Common Stock designated Class A
Common Stock (together, the "Reclassification") and declared a dividend of
one share of Class A Common Stock for each share of Class B Common Stock
outstanding (the "Stock Dividend"). The Stock Dividend had the effect of a
two-for-one stock split. In October 1999, the Company combined its Class A
and Class B Common Stock. The information set forth above for periods prior
to the combination reflects the historical trading information of the Class B
Common Stock.
9
<PAGE> 12
EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
The following table sets forth the compensation paid by the Company for
each of the three previous years for the period ending December 31 to persons
who served as Chief Executive Officer during the last fiscal year and each of
the other four most highly compensated executive officers of the Company
(together, the "Named Executive Officers"):
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION
------------
ANNUAL COMPENSATION STOCK
----------------------- OPTIONS ALL OTHER
YEAR SALARY ($) BONUS ($) (#)(1) COMPENSATION ($)
---- ---------- --------- ------------ ----------------
<S> <C> <C> <C> <C> <C>
Vinod Gupta(2)..................... 1999 48,000(3) -0- 400,000 -0-
Chairman and Chief Executive 1998 48,000(3) -0- -0- -0-
Officer 1997 48,000(3) -0- 140,000 -0-
William J. Chasse(4)............... 1999 260,000 250,000 260,000 -0-
President and Chief Executive 1998 260,000 80,833 100,000 -0-
Officer, infoUSA.Com 1997 240,000 -0- -0- -0-
William L. Kerrey(5)............... 1999 230,000 211,200 110,000 -0-
President, License Group 1998 200,000 74,380 40,000 -0-
1997 180,000 86,548 20,000 -0-
Monica Messer(6)................... 1999 260,000 99,400 210,000 -0-
President, Database and 1998 260,000 80,833 100,000 -0-
Technology
Group 1997 240,000 -0- 250,000 -0-
Susan L. Henricks(7)............... 1999 125,538 1,000,000 400,000 -0-
Senior Vice President, Large 1998 N/A N/A N/A N/A
Business Group 1997 N/A N/A N/A N/A
</TABLE>
- ---------------
(1) Except as otherwise expressly noted, each of the figures indicated below
includes options to purchase of shares of the Company's Common Stock, as
adjusted to reflect the combination of the Class A and Class B Common Stock
which occurred in October 1999.
(2) Vinod Gupta has served as Chief Executive Officer from the inception of the
Company until September 1997, and from August 1998 to the present.
(3) Excludes certain amounts paid to Annapurna Corporation and Everest
Investment Management for reimbursement of Company related executive travel
expenses, for acquisition and other related expenses, and for investment
advisory fees (see "Certain Transactions"). Annapurna Corporation is 100%
and Everest Investment Management is 40% owned by Vinod Gupta. Vinod Gupta
has agreed not to be eligible for cash bonuses.
(4) The bonus amount reflects the payment of $250,000 to WJ Research which is
owned by Mr. Chasse.
(5) The bonus amount includes $50,000 which was paid to James Company which is
owned by Mr. Kerrey.
(6) The bonus amount reflects the payment of $99,400 to Alborz Corp. which is
partially owned by Ms. Messer.
(7) Ms. Henricks joined the Company in July 1999 from First Data Corporation.
She entered into a five-year employment agreement with the Company which is
described under the heading "Employment Agreements" elsewhere in this Proxy
Statement.
10
<PAGE> 13
OPTION GRANTS IN THE LAST FISCAL YEAR
The following table sets forth each grant of stock options made during the
year ended December 31, 1999 to each of the Named Executive Officers:
OPTION GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE
INDIVIDUAL GRANTS VALUE AT ASSUMED
--------------------------------------------------------------- ANNUAL RATES OF STOCK
PERCENT OF TOTAL MARKET PRICE APPRECIATION FOR
OPTIONS OPTIONS GRANTED TO PRICE OPTION TERM($)(2)
GRANTED EMPLOYEES IN EXERCISE ON GRANT EXPIRATION -----------------------
NAME (#)(1) FISCAL YEAR PRICE($) DATE($) DATE 5% 10%
---- ------- ------------------ -------- -------- ---------- --------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
Vinod Gupta.......... 200,000 7.41% 6.00 6.00 10/18/2004 408,115 925,873
200,000 7.41% 7.00 7.00 6/22/2004 476,134 1,080,185
William J. Chasse.... 10,000 0.37% 6.00 6.00 4/1/2004 20,406 46,294
250,000 9.27% 7.00 7.00 4/30/2004 595,167 1,350,232
William L. Kerrey.... 10,000 0.37% 6.00 6.00 4/1/2004 20,406 46,294
50,000 1.85% 6.25 6.25 6/1/2004 106,280 241,113
50,000 1.85% 7.00 7.00 4/30/2004 119,033 270,046
Monica Messer........ 10,000 0.37% 6.00 6.00 4/1/2004 20,406 46,294
100,000 3.71% 6.25 6.25 6/1/2004 212,560 482,226
100,000 3.71% 7.00 7.00 4/30/2004 238,067 540,093
Susan L. Henricks.... 400,000 14.83% 6.90 6.90 7/5/2004 938,664 2,129,508
</TABLE>
- ---------------
(1) The option to purchase 200,000 shares at $6.00 per share granted to Mr.
Gupta was 100% vested as of the grant date. All other options indicated vest
and become exercisable in four equal annual installments on the first four
anniversaries of the date of grant based upon the optionee continuing to be
employed by the Company. Each of the figures indicated below represents
options to purchase shares of the Company's Common Stock pursuant to options
to purchase Common Stock granted under the 1997 Stock Option Plan.
(2) Potential realizable value is based on an assumption that the stock price
appreciates at the annual rate shown (compounded annually) from the date of
grant until the end of the option term. These numbers are calculated based
on the requirements promulgated by the Securities and Exchange Commission
and do not reflect the Company's estimate of future stock price growth.
OPTION EXERCISES AND FISCAL YEAR-END OPTION VALUES
The following table sets forth, for each of the Named Executive Officers,
the value realized on exercised options and the year-end value of unexercised
options:
AGGREGATED OPTION EXERCISES
AND DECEMBER 31, 1999 OPTION VALUES
<TABLE>
<CAPTION>
NUMBER OF SECURITIES VALUE OF UNEXERCISED
UNDERLYING UNEXERCISED IN-THE-MONEY OPTIONS
SHARES OPTIONS AT 12/31/99(#) AT 12/31/99($)(1)
ACQUIRED VALUE --------------------------- ---------------------------
NAME ON EXERCISE(#) REALIZED($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
---- -------------- ----------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Vinod Gupta.......... -0- -0- 1,349,999 990,001 7,636,597 5,489,003
William J. Chasse.... -0- -0- 311,666 383,334 1,583,606 2,301,694
William L. Kerrey.... 3,750 8,841 58,738 140,834 257,405 920,773
Monica Messer........ 30,000 70,725 166,666 393,334 222,056 1,785,594
Susan L. Henricks.... -0- -0- -0- 400,000 -0- 2,816,000
</TABLE>
- ---------------
(1) Based on a market price of $13.94 per share of Common Stock on December 31,
1999 minus the exercise price.
11
<PAGE> 14
EMPLOYMENT AGREEMENTS
On July 5, 1999, the Company entered into a five-year employment agreement
with Ms. Susan L. Henricks, the Company's Senior Vice President, Large Business
Group. Ms. Henricks joined the Company from First Data Corporation. In addition
to her annual salary of $320,000 (subject to subsequent adjustment), she
received a $1,000,000 bonus as a signing bonus and for her services in
connection with the integration of the businesses of the Company's acquisitions.
She also received a stock option to purchase 400,000 shares of the Company's
Common Stock and is eligible for stock options for an additional 100,000 shares
on each anniversary of her employment agreement if certain revenue growth
milestones are met. The employment agreement also provides for a non-competition
and non-solicitation covenants, each of which continues during the term of the
agreement and 18 months thereafter.
REPORT OF THE COMPENSATION COMMITTEE
The following is a report of the Compensation Committee of the Company
describing the compensation policies and rationale applicable to the Company's
executive officers with respect to the compensation paid to such executive
officers for the year ended December 31, 1999. The information contained in this
report shall not be deemed to be "soliciting material" or to be "filed" with the
Securities and Exchange Commission nor shall such information be incorporated by
reference into any future filing under the Securities Act or the Exchange Act,
except to the extent that the Company specifically incorporates it by reference
into any such filing.
Effective January 1, 1999, the Compensation Committee included as members
Directors Harold W. Andersen, George F. Haddix and Elliot S. Kaplan, who at
present continue to serve on the committee.
TO THE BOARD OF DIRECTORS:
The Compensation Committee of the Board of Directors reviews and approves
salaries and bonuses payable to the Company's executive officers. The
Compensation Committee in effect during 1999 was composed of Directors Harold W.
Andersen, George F. Haddix and Elliot S. Kaplan, three non-employee members.
The philosophy used by the Compensation Committee in establishing
compensation for executive officers, including the Chief Executive Officer, is
to attract and retain key personnel through the payment of competitive base
salaries and the grant of appropriate stock options, and to reward performances
through annual bonuses. The Internal Revenue Code limits companies' ability to
deduct for income tax purposes compensation paid to any individual employee in
excess of $1 million. The Company intends to take the necessary steps to conform
its compensation arrangements to comply with the deductibility ceiling.
Vinod Gupta's compensation as Chief Executive Officer consists of his base
salary, which was set at an annual rate of $48,000 for 1999. Mr. Gupta declined
to participate in any of the Company's bonus programs for 1999. Also during
1999, the Company paid $2.2 million to Annapurna Corporation, which is 100%
owned by Mr. Gupta, for reimbursement of Company related executive travel
expenses and $1.3 million for acquisition and other related expenses. The
Company also paid $.5 million to Everest Investment Management, which is 40%
owned by Mr. Gupta, for investment advisory fees on transactions for which the
Company recorded gains of over $11.0 million. The Committee is continuing to
evaluate his compensation level. Mr. Gupta was also granted options to purchase
an aggregate of 400,000 shares of the Company's Common Stock during fiscal 1999.
The Company hired Ms. Susan L. Henricks in July 1999 as Senior Vice
President, Large Business group. She joined the Company from First Data
Corporation. The Company negotiated an employment agreement with Ms. Henricks
(see "Employment Agreements" above) under which the Company set her annual base
salary at $320,000 and paid her a $1,000,000 bonus as a signing bonus and for
her services in connection with the integration of the businesses of the
Company's acquisitions. She also received a stock option to purchase 400,000
shares of the Company's Common Stock and is eligible for stock options for an
additional
12
<PAGE> 15
100,000 shares on each anniversary of her employment agreement if certain
revenue growth milestones are met, to reward future performance.
The Compensation Committee reviewed and approved compensation packages for
all other executive officers in fiscal 1999, which provided for base salaries,
stock options and bonuses. The base salaries are based on each officer's
historical salary and past performance as well as on publicly available
information concerning executive compensation levels paid by other companies in
the Omaha, Nebraska area. Stock options were granted to officers to provide long
term incentives that are aligned with the interests of the Company's
stockholders, and at percentage interests in the Company that were comparable to
other Companies in the Omaha, Nebraska area and in the industry generally.
During 1999, there were two bonus plans in effect. The first applies to general
managers of product sales groups, and is based upon each general manager
achieving a defined percentage of the internal Company revenue and profit goals
for his or her product sales group. The second bonus plan, which applies to all
other executive officers and key employees (not including Mr. Gupta), is based
on the achievement of specified pre-tax, Company-wide profit levels. Neither
bonus plan is guaranteed and bonuses under either plan may be withheld by
management or the Board of Directors, or adjusted in the event of an acquisition
during the year. During 1999, the Company paid bonuses to its executive officers
to recognize their efforts in effecting the acquisition of Donnelley Marketing
and their services in connection with the integration of the acquired business.
Compensation Committee
Harold W. Andersen, George F. Haddix and Elliot S. Kaplan
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Exchange Act requires the Company's officers and
directors, and persons who own more than ten percent of a registered class of
the Company's equity securities, to file reports of ownership on Form 3 and
changes in ownership on Form 4 or Form 5 with the SEC. Such officers, directors
and 10% stockholders are also required by SEC rules to furnish the Company with
copies of all Section 16(a) forms they file.
Based solely on its review of the copies of such forms received by it, or
written representations from certain reporting persons, the Company believes
that, during the fiscal year ended December 31, 1999, all Section 16(a) filing
requirements applicable to its officers, directors and 10% stockholders were
timely complied with.
CERTAIN TRANSACTIONS
During 1999, the Company paid $2.2 million to Annapurna Corporation, which
is 100% owned by Mr. Gupta, for reimbursement of Company related executive
travel expenses and $1.3 million for acquisition and other related expenses. The
Company also paid $.5 million to Everest Investment Management, which is 40%
owned by Mr. Gupta, for investment advisory fees on transactions for which the
company recorded gains of over $11.0 million.
In February 1997, as part of the acquisition of DBA, the Company entered
into an employee and consulting agreement with Paul A. Goldner for a term of
five years, under which Mr. Goldner receives compensation at a rate of $120,000
per annum and under which the Company appointed him to the Board and
subsequently nominated him for election as a director in connection with last
year's Annual Meeting.
The Company has retained the law firm of Robins, Kaplan, Miller & Ciresi
L.L.P. to provide certain legal services. Elliot S. Kaplan, a director of the
Company, is a name partner and former Chairman of the Executive Board of Robins,
Kaplan, Miller & Ciresi L.L.P.
13
<PAGE> 16
OTHER MATTERS
The Company knows of no other matters to be submitted to the meeting. If
any other matters properly come before the meeting, it is the intention of the
persons named in the enclosed proxy card to vote the shares they represent as
the Board of Directors may recommend.
By Order of the Board of Directors
Omaha, Nebraska
March 27, 2000
14
<PAGE> 17
Appendix
infoUSA INC.
ANNUAL MEETING OF STOCKHOLDERS
FRIDAY, APRIL 28, 2000
10:00 A.M. CST
infoUSA INC. DATABASE AND TECHNOLOGY CENTER
1020 EAST 1ST STREET
PAPILLION, NEBRASKA 68046
infoUSA INC.
5711 SOUTH 86TH CIRCLE, OMAHA, NEBRASKA 68127 PROXY
- --------------------------------------------------------------------------------
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS FOR USE AT THE ANNUAL MEETING
OF STOCKHOLDERS OF infoUSA INC. (THE "COMPANY") TO BE HELD ON APRIL 28, 2000 OR
ANY ADJOURNMENTS THEREOF.
The shares of the Company's Common Stock you hold as of the record date on March
17, 2000 will be voted as you specify below.
By signing the proxy, you revoke all prior proxies and appoint Stormy Dean and
Fred Vakili, or either of them, as proxies with full power of substitution, to
vote all shares of stock of the Company of record in the name of the
undersigned at the close of business on March 17, 2000 at the Annual Meeting of
Stockholders.
The undersigned stockholder hereby acknowledges receipt of the Notice of the
Annual Meeting of Stockholders and Proxy Statement, each dated March 27, 2000.
See reverse for voting instructions.
<PAGE> 18
Please detach here
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR ITEMS 1 AND 2.
<TABLE>
<S> <C> <C> <C>
1. Election of directors (with 01 Vinod Gupta [ ] Vote FOR [ ] Vote WITHHELD
terms expiring 2003): 02 George Haddix all nominees from all nominees
(except as marked)
(Instructions: To withhold authority to vote for any
indicated nominee, write the number(s) of the -------------------------------------------
nominee(s) in the box provided to the right.) [ ] For [ ] Against [ ] Abstain
</TABLE>
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED AS DIRECTED OR, IF NO
DIRECTION IS GIVEN, WILL BE VOTED FOR EACH PROPOSAL. IN THEIR DISCRETION, THE
PROXIES ARE AUTHORIZED TO VOTE WITH RESPECT TO SUCH OTHER MATTERS AS MAY BE
PROPERLY BROUGHT BEFORE THE MEETING OR ANY ADJOURNMENTS THEREOF.
Address Change? Mark Box [ ]
Indicate changes below:
Date
-----------------------------------
-----------------------------------------------
Signature(s) in Box
Please sign exactly as your name(s) appear on
Proxy. If held in joint tenancy, all persons
must sign. Trustees, administrators, etc.,
should include title and authority. Corporations
should provide full name of corporation and
title of authorized officer signing the proxy.
