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infoUSA
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Dolphin
Limited Partnership I, L.P.
Ninety-Six
Cummings Point Road
Stamford,
CT 06902
May
18,
2006
Dear
Fellow infoUSA
Stockholder:
There
is
still time for you to participate in bringing long overdue positive change
at
infoUSA
by
voting the BLUE
proxy
card FOR
our
highly qualified, independent nominees and our by-law amendment at the May
26,
2006 Annual Meeting. These nominees are only serving to help you and have no
ties to Dolphin, infoUSA
or
its management
The
nominees are committed to bringing real value to all stockholders through real
board and management accountability. But for that to happen, ALL stockholders
must act now and vote for positive change at
infoUSA
by voting the BLUE proxy card today. It is up to you, the time is now.
In
order
to ensure that your shares are received in time to be voted, we have included
for your convenience a postage paid overnight return envelope, with instructions
to arrange for a free pick-up. You may also be able to vote by telephone or
Internet -- just follow the instructions on the enclosed BLUE
proxy
card.
***IMPORTANT
NEW DEVELOPMENT***
INSTITUTIONAL
SHAREHOLDER SERVICES RECOMMENDS THAT ITS
CLIENTS
VOTE FOR DOLPHIN’S INDEPENDENT NOMINEES AND THE BY-
LAW
AMENDMENT
We
are
pleased to report that Institutional Shareholder Services (ISS), the world’s
leading independent proxy voting and corporate governance advisory service,
has
recommended that its clients vote for our nominees and the by-law amendment.
ISS’s voting recommendations are relied upon by institutional investors, mutual
funds and other fiduciaries around the world.
ISS’s
recommendation: “After reviewing the facts and circumstances …, we believe that
IUSA shareholders would be best served by voting for the dissident slate. In
our
opinion, the IUSA board needs an injection of objectivity, accountability and
fairness towards shareholders. The dissidents’ skill sets and track record
indicate that they could help to effect such change.”
Here
are
some other things ISS had to say:
On
“Managing” Mr. Vinod Gupta, infoUSA’s
Chairman and CEO
“Representatives
of the company claim that the current board can manage a ‘larger than life’ CEO.
The evidence seems to cast some doubt on this assertion. IUSA trades at a
discount to its peers, perhaps reflecting a ‘poor governance discount’, as
reflected in the high director turnover, the large amount of related party
transactions, and the poison pill exemption for Mr. Gupta.”
On
the Termination of the Special Committee Seeking Value Enhancing Alternatives
For You.
“A
board
that sets up a special committee to independently examine a takeover bid should
not disband that committee solely because it comes to a conclusion that is
unpalatable to those that are outside the committee; to hold otherwise would
be
to imply that a special committee exists solely to rubber-stamp a
process.”
On
the Composition of the Current Board
“At
best,
the nomination of insider-selected candidates is poor optics; at worst, it
raises the specter of cronyism or an “old boys network” that may result in a
board that may not oversee management with the detachment necessary to make
objective decisions that are in the best interests of
shareholders.”
On
Mr Vinod Gupta’s Options on 6% of the Company and His Potential Creeping
Takeover
“If
the
board continues to grant options to Mr. Gupta (the last grant was in March
2005), then the ability for Mr. Gupta to conduct a creeping takeover will only
be exacerbated. As long as there is no cap on Mr. Gupta’s share ownership, he
will be able to exercise ever-increasing levels of control over the company
without paying a control premium to shareholders. Once Mr. Gupta crosses the
50%
threshold, he will be able to exercise absolute control over IUSA.”
On
Why Your infoUSA
Shares Trade at a Discount
“Of
course, it is difficult to identify with certainty the reasons for a trading
multiple discount, but one possible explanation is the dissident’s contention
that there is a “Gupta discount” holding down the IUSA share price. Although the
company share price has tracked its peers, shareholders could reasonably argue
that IUSA shares should have outperformed its peers but for the discount
effect.”
We
are
gratified by the strong support of ISS, a world recognized provider of sound,
independent voting advice. We urge all shareholders to follow their
recommendations and vote the BLUE
proxy
today to provide the Board with “an injection of objectivity, accountability and
fairness towards shareholders.”
RATHER
THAN ADDRESS THE REAL PROBLEMS AT infoUSA,
THE FULL
BOARD
AND MR. VINOD GUPTA ONLY CONTINUE THEIR EFFORTS TO
MISLEAD
YOU
DON’T
BUY IT!
In
yet
another example of their efforts to mislead you, the full Board and Mr. Vinod
Gupta recently sent stockholders a letter professing a newly discovered
“commitment to good corporate governance.”
We
say to
Mr. Vinod Gupta and the full Board: Show Us!
Demonstrate
your newly discovered “commitment to good corporate governance” by:
| · |
Reconstituting
the Special Committee to complete its review
|
| · |
Eliminating
Mr. Vinod Gupta’s exclusive exemption from the Poison Pill
|
| · |
Eliminating
all related party and/or direct payments for the 80 foot yacht, jet
planes, residences, luxury cars, etc.
|
| · |
Holding
top management accountable for continued poor operating performance
and
missed targets
|
| · |
Eliminating
further option grants to Mr. Vinod Gupta that expand his control
|
| · |
Eliminating
the repricing provisions in the stock option plan
|
| · |
Replacing
directors that have conflicts and/or ties to infoUSA
or its top management
|
| · |
Bringing
down to earth your “larger than life” Chairman, as incumbent Director
George Haddix described Mr. Vinod Gupta
|
While
we
would applaud a genuine death bed conversion to the principals of good corporate
governance, we believe that actions speak louder than words.
We
Urge You To Vote FOR Proposals 1 And 2 To Elect Dolphin’s
Independent
Nominees And Support The Important
By-Law
Amendment.
We
encourage you to visit our website www.iusaccountability.com,
on
which we will continue to post documents and other information that disclose
our
findings on infoUSA.
Remember,
if you hold your shares in the name of a bank or broker, your vote is
confidential!
If
you
have any questions, or would like assistance in voting your shares, please
contact the company that is helping us with this most important election,
Innisfree M&A Incorporated, at 1-888-750-5834.
Thank
you
for your support.
Very
truly yours,
/s/
Donald T.
Netter
Donald
T.
Netter
Senior
Managing Director
IMPORTANT
NOTE:
If
you
hold your
shares in
a bank
or brokerage
firm, you
may
be able
to
vote
by
telephone or
Internet.
Please
review the enclosed voting form to determine if these voting
options
are
available to you.