UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A

Proxy Statement Pursuant To Section 14(A) of the

         Filed by the Registrant                                         þ

         Filed By a Party other than the Registrant            o

         Check the appropriate box:

	þ		Preliminary Proxy Statement
	o		Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
	o		Definitive Proxy Statement
	o		Definitive Additional Materials
	o		Soliciting Material Pursuant to § 240.14a-12

infoGROUP Inc.

(Name of Registrant as Specified In Its Charter)

 

Payment of Filing Fee (Check the Appropriate Box):

	o		No fee required.
	o		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 transaction 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:

	þ		Fee paid previously with preliminary materials.
	o		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:

 

infoGROUP Inc.

5711 South 86^th Circle

Omaha, Nebraska

 

 • , 2010

 

Dear Stockholder:

 

The board of directors of infoGROUP Inc., a Delaware corporation (“infoGROUP”), acting upon the unanimous recommendation of the Mergers & Acquisitions Committee (“M&A Committee”) of infoGROUP’s board of directors, has unanimously approved a merger agreement providing for the acquisition of infoGROUP by Omaha Holdco Inc., an entity controlled by CCMP Capital Investors II, L.P. and CCMP Capital Investors (Cayman) II, L.P. If the merger contemplated by the merger agreement is completed, you will be entitled to receive $8.00 in cash, without interest and less any applicable withholding taxes, for each share of the Company’s common stock (the “Common Stock”) owned by you (unless you have exercised your appraisal rights with respect to the merger).

 

At a special meeting of our stockholders, you will be asked to vote on a proposal to adopt the merger agreement. The special meeting will be held on • at [location TBD]. Notice of the special meeting and the related proxy statement are enclosed.

 

The accompanying proxy statement provides you with detailed information about the special meeting, the merger agreement and the merger. A copy of the merger agreement is attached as Annex A to the proxy statement. We encourage you to read the entire proxy statement and the merger agreement carefully. You may also obtain more information about infoGROUP from documents we have filed with the Securities and Exchange Commission.

 

Our board of directors has unanimously determined that the merger is fair to and in the best interests of infoGROUP and its stockholders, and unanimously recommends that you vote “FOR” the adoption of the merger agreement. This recommendation is based, in large part, upon the unanimous recommendation of the M&A Committee of the board of directors consisting of four independent and disinterested directors.

 

Your vote is very important, regardless of the number of shares of Common Stock you own. We cannot complete the merger unless a majority of the votes entitled to be cast by the holders of the outstanding shares of our Common Stock are cast in favor of the adoption of the merger agreement. The failure of any stockholder to vote on the proposal to adopt the merger agreement or an abstention will have the same effect as a vote against the adoption of the merger agreement.

 

Whether or not you plan to attend the special meeting, please complete, date, sign and return, as promptly as possible, the enclosed proxy in the accompanying reply envelope, or submit your proxy by telephone or the Internet. If you have Internet access, we encourage you to record your vote via the Internet. If you attend the special meeting and vote in person, your vote by ballot will revoke any proxy previously submitted.

 

Thank you in advance for your cooperation and continued support.

 

Sincerely,

 

Chairman of the Board

 

Neither the Securities and Exchange Commission nor any state securities regulatory agency has approved or disapproved the merger, passed upon the merits or fairness of the merger or passed upon the adequacy or accuracy of the disclosure in this document. Any representation to the contrary is a criminal offense.

 

The proxy statement is dated • , 2010, and is first being mailed to stockholders on or about • , 2010.

 

infoGROUP Inc.

5711 South 86^th Circle

Omaha, Nebraska

 

NOTICE OF SPECIAL MEETING OF STOCKHOLDERS

TO BE HELD ON • , 2010

 

Dear Stockholder:

 

A special meeting of stockholders of infoGROUP Inc., a Delaware corporation (the “Company”), will be held on • , 2010, at • .m. local time, at [location TBD], for the following purposes:

 

1. To consider and vote on a proposal to adopt the Agreement and Plan of Merger (as it may be amended from time to time, the “Merger Agreement”), dated as of March 8, 2010, by and among the Company, Omaha Holdco Inc., a Delaware corporation (“Parent”), and Omaha Acquisition Inc., a Delaware corporation and a wholly-owned subsidiary of Parent (“Acquisition Sub”). A copy of the Merger Agreement is attached as Annex A to the accompanying proxy statement. Pursuant to the terms of the Merger Agreement, Acquisition Sub will merge with and into the Company (the “Merger”) and each outstanding share of the Company’s Common Stock, par value $0.0025 per share (the “Common Stock”), (other than (i) shares of Common Stock owned by Parent, Acquisition Sub or the Company, in each case immediately prior to the effective time of the Merger, and (ii) shares held by stockholders, if any, who have properly demanded statutory appraisal rights, if any) will be converted into the right to receive $8.00 in cash, without interest and less any applicable withholding taxes.

 

2. To consider and vote on a proposal to adjourn the special meeting, if necessary or appropriate, to solicit additional proxies if there are insufficient votes at the time of the meeting to approve the proposal to adopt the Merger Agreement.

 

Only stockholders of record at the close of business on • , 2010 are entitled to notice of and to vote at the special meeting or at any adjournment or postponement of the special meeting. All stockholders of record are cordially invited to attend the special meeting in person.

 

Your vote is very important, regardless of the number of shares of Common Stock you own. The adoption of the Merger Agreement requires the affirmative vote of a majority of the votes entitled to be cast by the holders of the outstanding shares of Common Stock. Even if you plan to attend the special meeting in person, we request that you complete, sign, date and return the enclosed proxy or submit your proxy by telephone or the Internet prior to the special meeting to ensure that your shares will be represented at the special meeting if you are unable to attend. If you have Internet access, we encourage you to record your vote via the Internet. If you fail to return your proxy card or fail to submit your proxy by phone or the Internet, your shares will not be counted for purposes of determining whether a quorum is present at the meeting and will have the same effect as a vote against the adoption of the Merger Agreement, but will not affect the outcome of the vote regarding the adjournment proposal, if necessary. If you are a stockholder of record, voting in person at the meeting will revoke any proxy previously submitted. If you hold your shares through a bank, broker or other custodian, you must obtain a legal proxy from such custodian in order to vote in person at the meeting.

 

Please note that space limitations make it necessary to limit attendance at the special meeting to stockholders as of the record date (or their authorized representatives) holding admission tickets or other evidence of ownership. The admission ticket is detachable from your proxy card. If your shares are held by a bank or broker, please bring to

the special meeting your statement evidencing your beneficial ownership of Common Stock and photo identification.

 

The board of directors, acting upon the unanimous recommendation of the Mergers & Acquisitions Committee, which is comprised entirely of independent members of the board of directors, unanimously (i) determined that the Merger is in the best interests of the Company and its stockholders, and declared it advisable to enter into the Merger Agreement, (ii) approved the execution and delivery of the Merger Agreement, the performance by the Company of its covenants and agreements contained in the Merger Agreement and the consummation of the transactions contemplated thereby, including the Merger upon the terms and subject to the conditions contained in the Merger Agreement, and (iii) resolved to recommend that the stockholders approve the adoption of the Merger Agreement and directed that such matter be submitted for consideration of the stockholders of the Company at the special meeting. The board of directors unanimously recommends that you vote “FOR” the adoption of the Merger Agreement, and “FOR” the adjournment of the special meeting, if necessary or appropriate, to solicit additional proxies.

 

Stockholders of the Company who do not vote in favor of the adoption of the Merger Agreement will have the right to seek appraisal of the fair value of their shares of Common Stock if they deliver a demand for appraisal before the vote is taken on the Merger Agreement and comply with all requirements of Delaware law, which are summarized in the accompanying proxy statement.

 

WHETHER OR NOT YOU PLAN TO ATTEND THE SPECIAL MEETING, PLEASE COMPLETE, DATE, SIGN AND RETURN, AS PROMPTLY AS POSSIBLE, THE ENCLOSED PROXY IN THE ACCOMPANYING REPLY ENVELOPE, OR SUBMIT YOUR PROXY BY TELEPHONE OR THE INTERNET. IF YOU HAVE INTERNET ACCESS, WE ENCOURAGE YOU TO RECORD YOUR VOTE VIA THE INTERNET. STOCKHOLDERS WHO ATTEND THE MEETING MAY REVOKE THEIR PROXIES AND VOTE IN PERSON.

 

By Order of the Board of Directors,

 

Thomas J. McCusker

Executive Vice President
for Business Conduct, General Counsel and Secretary

 

Omaha, Nebraska

 • , 2010

 

TABLE OF CONTENTS

 

 

	•	if you hold your shares in your name as a stockholder of record, by notifying our Secretary, Thomas J. McCusker, at 5711 South 86th Circle, Omaha, Nebraska 68127;
	•	by attending the special meeting and voting in person (your attendance at the meeting will not, by itself, revoke your proxy; you must vote in person at the meeting);
	•	by submitting a later-dated proxy card;
	•	if you voted by telephone or the Internet, by voting a second time by telephone or Internet; or
	•	if you have instructed a broker, bank or other nominee to vote your shares of Common Stock, by following the directions received from your broker, bank or other nominee to change those instructions.

	•	the accuracy of our representations and warranties,
	•	the performance in all material respects of our obligations prior to the consummation of the Merger,
	•	the absence of a continuing Company Material Adverse Effect (as defined in the Merger Agreement),
	•	our consolidated debt to EBITDA ratio, as calculated pursuant to the Merger Agreement, not exceeding 3.75:1 for a specific period prior to the Merger, and
	•	the delivery of certificates attesting to the foregoing conditions.

 

The following questions and answers are intended to address briefly some commonly asked questions regarding the Merger, the Merger Agreement and the special meeting. These questions and answers may not address all questions that may be important to you as an infoGROUP stockholder. Please refer to the “Summary” and the more detailed information contained elsewhere in this proxy statement, the annexes to this proxy statement and the documents referred to or incorporated by reference in this proxy statement, which you should read carefully. See “Where You Can Find More Information” on page 78.

 

 

 

 

 

 

 

 

 

This proxy statement, and the documents to which we refer you in this proxy statement, include forward-looking statements based on estimates and assumptions. There are forward-looking statements throughout this proxy statement, including, without limitation, under the headings “Summary,” “Questions and Answers about the Special Meeting and the Merger,” “The Merger,” “Opinion of Financial Advisor,” “Financing of the Merger,” “Limited Guarantee,” “Regulatory Approvals,” and “Litigation Related to the Merger,” and in statements containing words such as “believes,” “estimates,” “anticipates,” “continues,” “contemplates,” “expects,” “may,” “will,” “could,” “should” or “would” or other similar words or phrases. These statements, which are based on information currently available to us, are not guarantees of future performance and may involve risks and uncertainties that could cause our actual growth, results of operations, performance and business prospects, and opportunities to materially differ from those expressed in, or implied by, these statements. These forward-looking statements speak only as of the date on which the statements were made and we expressly disclaim any obligation to release publicly any updates or revisions to any forward-looking statement included in this proxy statement or elsewhere. In addition to other factors and matters contained or incorporated in this document, these statements are subject to risks, uncertainties, and other factors, including, among others:

 

 

and other risks detailed in our current filings with the SEC, including our most recent filings on Forms 10-Q and 10-K. See “Where You Can Find More Information” beginning on page 78. Many of the factors that will determine our future results are beyond our ability to control or predict. In light of the significant uncertainties inherent in the forward-looking statements contained herein, readers should not place undue reliance on forward-looking statements, which reflect management’s views only as of the date hereof. We cannot guarantee any future results, levels of activity, performance or achievements. The statements made in this proxy statement represent our views as of the date of this proxy statement, and it should not be assumed that the statements made herein remain accurate as of any future date. Moreover, we assume no obligation to update forward-looking statements or update the reasons that actual results could differ materially from those anticipated in forward-looking statements, except as required by law.

 

infoGROUP

 

infoGROUP Inc.

5711 South 86^th Circle

Omaha, Nebraska 68127

Phone: (402) 593-4500

 

infoGROUP, a Delaware corporation incorporated in 1972 with its headquarters in Omaha, Nebraska, is a leading provider of sales leads, mailing lists, direct marketing, database marketing, e-mail marketing and market research solutions that help our clients grow their sales and increase their profits. infoGROUP operates three principal business groups. The Data Group maintains several proprietary databases of information relating to U.S. and international businesses and consumers and offers access to those databases over the Internet through its various websites. The Services Group consists of subsidiaries providing list brokerage and list management, direct mail, database marketing and e-mail marketing services to large customers. The Marketing Research Group provides customer satisfaction surveys, employee surveys, opinion polling, and other market research services for businesses and for government.

 

For more information about infoGROUP, please visit our website at www.infogroup.com. Our website address is provided as an inactive textual reference only. The information provided on our website is not part of this proxy statement, and therefore is not incorporated by reference. See also “Where You Can Find More Information” on page 78. Our Common Stock is publicly traded on the NASDAQ Global Select Stock Market under the symbol “IUSA”.

 

Parent

 

Omaha Holdco Inc.

c/o CCMP Capital Advisors LLC

245 Park Avenue, 16^th Floor

New York, New York 10167

Phone: 212-600-9657

 

Omaha Holdco Inc., which we refer to as Parent, is a Delaware corporation that was organized solely for the purpose of acquiring infoGROUP and has not engaged in any business except for activities incidental to its organization and as contemplated by the Merger Agreement.

 

Acquisition Sub

 

Omaha Acquisition Inc.

c/o CCMP Capital Advisors LLC

245 Park Avenue, 16^th Floor

New York, New York 10167

Phone: 212-600-9657

 

Omaha Acquisition Inc., which we refer to as Acquisition Sub, is a Delaware corporation that was organized solely for the purpose of completing the proposed Merger. Acquisition Sub is a wholly-owned subsidiary of Parent and has not engaged in any business except for activities incidental to its organization and as contemplated by the Merger Agreement. Upon the consummation of the proposed Merger, Acquisition Sub will cease to exist and infoGROUP will continue as the Surviving Corporation.

 

This proxy statement is being furnished to our stockholders as part of the solicitation of proxies by our board of directors for use at the special meeting to be held on • , starting at • , at [location TBD], or at any postponement or adjournment thereof. The purpose of the special meeting is for our stockholders to consider and vote upon adoption of the Merger Agreement (and to approve the adjournment of the special meeting, if necessary or appropriate to solicit additional proxies). Our stockholders must adopt the Merger Agreement in order for the Merger to occur. If the stockholders fail to adopt the Merger Agreement, the Merger will not occur. A copy of the Merger Agreement is attached to this proxy statement as Annex A. This proxy statement and the enclosed form of proxy are first being mailed to our stockholders on • .

 

We have fixed the close of business on • , 2010 as the record date for the special meeting, and only holders of record of Common Stock on the record date are entitled to vote at the special meeting. On the record date, there were •  shares of Common Stock outstanding and entitled to vote. Each share of Common Stock entitles its holder to one vote on all matters properly coming before the special meeting.

 

A majority of the total voting power of Common Stock issued, outstanding and entitled to vote at the special meeting constitutes a quorum for the purpose of considering the proposals. Shares of Common Stock represented at the special meeting but not voted, including shares of Common Stock for which proxies have been received but for which stockholders have abstained, will be treated as present at the special meeting for purposes of determining the presence or absence of a quorum for the transaction of all business. In the event that a quorum is not present at the special meeting, it is expected that the meeting will be adjourned or postponed to solicit additional proxies.

 

Attendance

 

Attendance at the special meeting is limited to stockholders as of the record date (or their authorized representatives) holding admission tickets or other evidence of ownership. The admission ticket is detachable from your proxy card. If your shares are held by a bank or broker, please bring to the special meeting your statement evidencing your beneficial ownership of Common Stock and photo identification. Please note that cell phones, PDAs, pagers, recording and photographic equipment, camera phones and/or computers will not be permitted at the special meeting.

 

Adoption of the Merger Agreement requires the affirmative vote of the holders of a majority of the outstanding shares of Common Stock entitled to vote at the special meeting. For the proposal to adopt the Merger Agreement, you may vote “FOR”, “AGAINST” or “ABSTAIN”. Abstentions will not be counted as votes cast or shares voting on the proposal to adopt the Merger Agreement, but will count for the purpose of determining whether a quorum is present. If you abstain, it will have the same effect as a vote “AGAINST” the adoption of the Merger Agreement.

 

If you are a stockholder of record you may vote by:

 

 

If you return your signed proxy card, but do not mark the boxes showing how you wish to vote, your shares will be voted “FOR” the proposal to adopt the Merger Agreement and “FOR” the adjournment proposal.

As of the close of business on • , 2010, the record date, the directors and executive officers of infoGROUP held and are entitled to vote, in the aggregate, •  shares of Common Stock representing approximately [     ]% of the outstanding Common Stock. Each of the directors and executive officers of infoGROUP have entered into a voting agreement requiring that they vote all of their shares of Common Stock “FOR” the adoption of the Merger Agreement. In addition, Mr. Vinod Gupta, a former director of the Company, has entered into a voting agreement, requiring him to vote all of his beneficially owned shares of Common Stock of the company in favor of the adoption of the Merger Agreement. As of the close of business on [          ], 2010, the record date, the directors, executive officers and Mr. Gupta held and are entitled to vote, in the aggregate, [          ] shares of Common Stock representing approximately [     ]% of the outstanding Common Stock.

 

If you submit a proxy by telephone or the Internet or by returning a signed proxy card by mail, your shares will be voted at the special meeting as you indicate on your proxy card or by such other method. If you sign your proxy card without indicating your vote, your shares will be voted “FOR” the adoption of the Merger Agreement and “FOR” the adjournment or postponement of the special meeting, if necessary or appropriate, to solicit additional proxies, and in accordance with the recommendations of our board of directors on any other matters properly brought before the special meeting for a vote.

 

If your shares of Common Stock are held in street name, you will receive instructions from your broker, bank or other nominee that you must follow in order to have your shares voted. If you do not instruct your broker to vote your shares, it has the same effect as a vote “AGAINST” adoption of the Merger Agreement.

 

Proxies received at any time before the special meeting, and not revoked or superseded before being voted, will be voted at the special meeting. You have the right to change or revoke your proxy at any time before the vote taken at the special meeting:

 

 

Please do not send in your stock certificates with your proxy card.  When the Merger is completed, a separate letter of transmittal will be mailed to you that will enable you to receive the merger consideration in exchange for your stock certificates.

 

Although it is not currently expected, the special meeting may be adjourned or postponed for the purpose of soliciting additional proxies. Any adjournment may be made without notice (if the adjournment is not for more than 30 days and a new record date is not set for the adjourned meeting), other than by an announcement made at the special meeting of the time, date and place of the adjourned meeting. Whether or not a quorum exists, holders of a majority of the combined voting power of Common Stock present in person or represented by proxy at the special meeting and entitled to vote thereat may adjourn the special meeting. Any signed proxies received by infoGROUP in which no voting instructions are provided on such matter will be voted “FOR” an adjournment or postponement of the special meeting, if necessary or appropriate, to solicit additional proxies. Any adjournment or postponement of the special meeting for the purpose of soliciting additional proxies will allow infoGROUP’s stockholders who have already sent in their proxies to revoke them at any time prior to their use at the special meeting as adjourned or postponed.

 

Stockholders are entitled to statutory appraisal rights under Delaware law in connection with the Merger. This means that you are entitled to have the value of your shares determined by the Delaware Court of Chancery and to receive payment based on that valuation. The ultimate amount you receive as a dissenting stockholder in an appraisal proceeding may be more than, the same as or less than the amount you would have received under the Merger Agreement.

 

To properly exercise your appraisal rights, you must submit a written demand for appraisal to the Company before the vote is taken on the Merger Agreement and you must not vote in favor of the adoption of the Merger Agreement. Your failure to follow exactly the procedures specified under Delaware law will result in the loss of your appraisal rights. See “Dissenters’ Rights of Appraisal” beginning on page 75 and the text of the Delaware appraisal rights statute reproduced in its entirety as Annex C.

 

This proxy solicitation is being made and paid for by infoGROUP on behalf of its board of directors. In addition, we have retained Innisfree M&A Incorporated to assist in the solicitation. We will pay Innisfree M&A Incorporated approximately $50,000, plus $5.00 per each call made to or received from stockholders of the Company, plus out-of-pocket expenses for their assistance. In addition, in the event that the merger agreement is adopted by the stockholders of the Company, we will pay Innisfree M&A Incorporated an additional fee of $25,000. Our directors, officers and employees may solicit proxies by personal interview, mail, e-mail, telephone, facsimile or other means of communication. These persons will not be paid additional remuneration for their efforts. We will also request brokers and other fiduciaries to forward proxy solicitation material to the beneficial owners of shares of Common Stock that the brokers and fiduciaries hold of record. Upon request, we will reimburse them for their reasonable out-of-pocket expenses. In addition, we will indemnify Innisfree M&A Incorporated against any losses arising out of that firm’s proxy soliciting services on our behalf.

 

If you have more questions about the Merger or how to submit your proxy, or if you need additional copies of this proxy statement or the enclosed proxy card or voting instructions, please call our proxy solicitor Innisfree M&A Incorporated toll-free at (888) 750-5835 (banks and brokers call collect at (212) 750-5833).

 

The reports, opinions or appraisals referenced in this proxy statement will be made available for inspection and copying at the principal executive offices of the Company during its regular business hours by any interested stockholder of Common Stock.

 

This discussion of the Merger is qualified in its entirety by reference to the Merger Agreement, which is attached to this proxy statement as Annex A. You should read the entire Merger Agreement carefully as it is the legal document that governs the Merger.

 

The Company was established in Nebraska in 1972 and was subsequently incorporated in Delaware in 1991. While the Company has had numerous names in its history (including infoUSA Inc.), the Company’s name was changed to infoGROUP Inc. on May 30, 2008.

 

The Board of Directors and management team have been regularly evaluating the Company’s business and operations, the Company’s long-term strategic goals, and the Company’s prospects as an independent company since the Company’s initial public offering in 1992. As part of this ongoing process, the Board of Directors has also periodically reviewed strategic alternatives, including several times throughout 2007 and 2008.

 

On December 22, 2008, Mr. Gupta, of his own volition and without approval of the Board, issued a public statement recommending that the Company explore its strategic alternatives, including a possible sale of the Company. Mr. Gupta indicated that he might either be a buyer of the Company or a seller of his equity interests, depending on the circumstances. At the time, Mr. Gupta was a non-independent director of the Company and beneficially owned 22,716,992 shares of the Company’s common stock, or approximately 39.9% of the issued and outstanding shares of the Company’s Common Stock. Mr. Gupta did not at this time or at any other time make a formal proposal to buy the Company.

 

On December 22, 2008, in response to Mr. Gupta’s statement, the Company issued its own statement indicating that the Company would retain Evercore as financial advisor to the Company’s independent directors (the “Independent Directors”) to assist the Independent Directors in analyzing the Company’s strategic alternatives and evaluate the Company’s stand alone strategic and financial plan. On December 31, 2008, the Company signed an engagement letter with Evercore.

 

On December 30, 2008, at a special meeting of the Board of Directors, Mr. Gupta reiterated to the Board of Directors his belief that the Company should be sold. At that meeting, the Board was provided with a brief update on the status of discussions regarding Evercore’s engagement to serve as financial advisor to the Independent Directors.

 

On January 22, 2009, a financial sponsor (“Party A”) sent the Company a letter expressing Party A’s preliminary interest in acquiring the Company for $7.00 per share of Common Stock. Party A also conveyed its desire to commence a due diligence review of the Company to verify Party A’s preliminary valuation of the Company.

 

On January 23, 2009, a representative of Party A contacted Mr. Fairfield to further express Party A’s interest in exploring an acquisition of the Company.

 

On January 25, 2009, the Board of Directors convened a special meeting to discuss the Party A letter and the Company’s various strategic alternatives. At the meeting, the Board of Directors determined that additional information should be collected to determine the legitimacy of the Party A letter.

 

On January 29, 2009, at a regularly scheduled meeting, the Board of Directors further discussed the Party A letter and the Company’s strategic alternatives. At the meeting, Evercore made a presentation regarding the Company’s valuation and various strategic alternatives that were available to the Company. A representative of Hogan & Hartson, outside counsel to the Company at the time, also attended this meeting and reviewed with the Board of Directors their fiduciary duties in the context of considering the Company’s strategic alternatives.

 

On January 29, 2009, the Independent Directors convened a separate meeting to discuss potential responses to Party A. At that meeting and in part as a result of the actions of Mr. Gupta, the Independent Directors recommended that the Board of Directors form a special mergers and acquisitions committee comprised solely of independent, disinterested directors, which did not include Mr. Gupta, to address the Party A letter and any similar proposals that

the Company may receive and to determine after careful evaluation and analysis the best strategic alternative for the Company to maximize value for all shareholders.

 

On January 30, 2009, at a regularly scheduled meeting, the Board of Directors approved the formation of a special mergers and acquisitions committee comprised of independent directors Gary Morin, Roger Siboni and Tom Thomas (the “M&A Committee”). Gary Morin was appointed the chair of the M&A Committee. The M&A Committee was given authority to conduct a strategic alternatives review and to determine whether or not to conduct and participate in any negotiations regarding any proposed transaction, and the Board of Directors retained the final authority to make any decision to accept or enter into any transaction. The decision of the Board of Directors to establish the M&A Committee was one of several steps designed to eliminate the disruptive impact that Mr. Gupta’s actions might have on the process for evaluating strategic alternatives. The Board recognized that as a member of the Board of Directors, Mr. Gupta had rights to and would participate in Board discussions and receive the same updates from the M&A Committee as other members of the Board of Directors. However, the Board of Directors decided that Mr. Gupta would not be allowed participate in M&A Committee meetings and that the information he received regarding the process of evaluating strategic alternatives would be carefully reviewed and considered by the M&A Committee and its legal counsel.

 

On February 6, 2009, at a special meeting of the Board of Directors, Mr. Morin provided the Board of Directors with an update on the activities of the M&A Committee since its formation. The Board also determined at the meeting that the Independent Directors should have the full and exclusive authority to consider and determine what action should be taken on behalf of the Company with respect to the pending SEC investigation involving the Company and certain of its then current and former officers and directors.

 

On February 9, 2009, Mr. Fairfield sent a letter to Party A indicating that the Board of Directors had established a special committee to evaluate the Company’s strategic alternatives and that the Company was considering the Party A letter.

 

On February 17, 2009, the M&A Committee convened a meeting to further consider the Party A letter and begin the process of evaluating the various strategic alternatives available to the Company. At the meeting, representatives of Wilson Sonsini Goodrich & Rosati (“WSGR”) reviewed with the members of the M&A Committee their fiduciary duties in the context of considering the Company’s strategic alternatives. The M&A Committee then agreed to engage WSGR to assist the M&A Committee in evaluating the various strategic alternatives available to the Company. The M&A Committee then instructed management to communicate to Party A that advisors had been retained by the M&A Committee and that additional feedback, if any, would be provided at some later date.

 

On February 24, 2009, at a regularly scheduled M&A Committee meeting attended by representatives of WSGR and Evercore, management provided the M&A Committee with an update on recent conversations between the Company and its advisors, and Party A and its advisors. The M&A Committee then requested that management develop a long term strategic plan for the Company and provide such plan to Evercore who would develop strategic alternatives for the Company.

 

On March 6, 2009, at a regularly scheduled M&A Committee meeting attended by representatives of WSGR and Evercore, management provided the M&A Committee with an update on the status of the Company’s long term strategic plan. The M&A Committee then discussed various ways to maximize value for all shareholders. The alternatives discussed included continuing to execute on the Company’s present business plan, a possible sale of the Company, a possible restructuring of the Company’s businesses to enhance its focus on digital technologies and the possible sale of certain of the Company’s non-core and underperforming assets. Discussions of the Company’s current business plan included a careful review of the risks associated with managing and consolidating the Company’s disparate businesses, the challenges of managing costs in the Company’s existing businesses and in turn investing in new product initiatives, such as an increased focus on digital technologies, to facilitate revenue growth. In discussing the required investment in new product initiatives, the M&A Committee focused on the extensive personnel and organizational changes that would be required to execute on this business strategy. The M&A Committee also noted that the Company’s management had, to date, been unable to achieve the levels of revenue growth and cost management the M&A Committee had sought and, for this reason, although reaching no definitive conclusions, the M&A Committee considered the viability of pursuing a stand alone business strategy and the

uncertainty of achieving the desired shareholder value by doing so. The M&A Committee further noted that a sale of the Company would not present the same level of execution risk and uncertainty inherent in other alternatives. Following these discussions, the M&A Committee requested that Evercore prepare a presentation for the M&A Committee on ways to maximize value for all shareholders focusing on these and other possible alternatives.

 

On March 11, 2009, members of Party A presented to management of the Company at the Company’s headquarters an overview of Party A, its perspectives regarding the Company and rationale for a potential transaction with Party A.

 

On March 12, 2009, at a regularly scheduled M&A Committee meeting attended by representatives of WSGR and Evercore, Evercore made a presentation to the M&A Committee regarding the Company’s strategic alternatives in comparison to the Company’s existing business plans and prospects. Evercore’s presentation included discussion of some of the factors to be considered by the M&A Committee in connection with several strategic alternatives, including the continued pursuit of the Company’s existing independent business plan; select divestitures of non-core assets; alternatives for reducing Mr. Gupta’s ownership position; and a sale of the Company. Representatives of WSGR also reviewed with the members of the M&A Committee their fiduciary duties in the context of considering the Company’s strategic alternatives. The M&A Committee was then provided with an update on the Company’s recent conversations with several potential financial and strategic partners that surfaced since the December 22, 2008 press release by Mr. Gupta. At the meeting, the M&A Committee was also informed that Mr. Gupta was actively trying to sell his block of shares and was threatening to file a lawsuit if the Board of Directors did not change its course and proceed toward a sale of the Company. The M&A Committee determined that the Company needed to continue to study and evaluate its long-term strategic plan and resulting valuation and strategic alternatives before the Board of Directors could properly consider its options.

 

On March 12, 2009, at a regularly scheduled meeting of the Board of Directors attended by representatives of WSGR and Evercore, representatives of WSGR reviewed with the members of the Board of Directors their fiduciary duties in the context of considering the Company’s strategic alternatives. At the meeting, Mr. Morin provided the Board of Directors with an update on the activities of the M&A Committee, including its decision to put in place a long term strategic plan to analyze the Company’s prospects over the next three to five years, and to use such plan to determine what course of action would be in the best interests of all of the Company’s stockholders. At the meeting, Mr. Gupta again expressed his opinion that it was time for the Company to publicly announce that it was for sale and that Evercore had been hired to handle the sale. A representative of WSGR then advised the Board of Directors that the M&A Committee had already begun a very thorough process to consider all of the Company’s strategic options.

 

On March 16, 2009, at a regularly scheduled M&A Committee meeting attended by representatives of WSGR and Evercore, the M&A Committee discussed at length how the Company should respond to unsolicited indications of interest received from third parties. The M&A Committee determined that the Company should be generally responsive to any such inquiries, but that such inquiries should not be allowed to bypass the orderly review process designed by the Company’s independent advisers and Independent Directors to maximize shareholder value.

 

On March 25, 2009, at a regularly scheduled M&A Committee meeting attended by representatives of WSGR and Evercore, the M&A Committee had further discussion of strategic alternatives they had discussed at their March 6, 2009 meeting. Although these alternatives were discussed in more detail, the M&A Committee did not reach any definitive conclusions.

 

On March 30, 2009, at a regularly scheduled M&A Committee meeting attended by representatives of WSGR and Evercore, the M&A Committee discussed the fact that one of the Company’s largest shareholders had received a copy of the Party A letter from an anonymous source. The M&A Committee then discussed the problem of leaks of confidential information and expressed concern regarding the nature of the leaked information.

 

On March 30, 2009, as part of the Company’s long term strategic plan, the Company announced the sale of Macro International Inc., a wholly owned subsidiary of the Company, to ICF International.

 

On April 3, 2009, at a regularly scheduled M&A Committee meeting attended by representatives of WSGR and Evercore, management provided the M&A Committee with a progress report on the Company’s long term

strategic plan. The M&A Committee discussed the importance of the plan in assessing the Company’s strategic alternatives and maximizing shareholder value.

 

On April 23, 2009, Evercore was further engaged by the Board of Directors to act as a financial advisor in connection with the evaluation of the potential adoption of a shareholder rights plan.

 

On April 24, 2009, at a regularly scheduled M&A Committee meeting attended by representatives of WSGR and Evercore, management presented the Company’s long term strategic plan to the M&A Committee. The long term strategic plan was a financial forecast created by the Company’s corporate finance team that included income statements on a business unit basis, constructed using assumptions regarding revenue and expense growth rates. This financial forecast contained quarterly projections for the 2009 and 2010 periods and annual projections for the 2011 through 2014 periods. The M&A Committee discussed that management’s long term strategic plan did not include any investments required to be made in connection with, nor potential future performance of, new business strategies and initiatives not currently in development by the Company.

 

On April 28, 2009, Party A sent the Company a letter reiterating its strong interest in acquiring the Company.

 

On April 30, 2009, at a regularly scheduled M&A Committee meeting attended by representatives of WSGR and Evercore, management presented the Company’s revised long term strategic plan to the M&A Committee. The M&A Committee, management and Evercore engaged in extensive discussions regarding the plan’s construction and underlying assumptions. At the M&A Committee’s direction, management and Evercore undertook to complete some additional analysis. The M&A Committee then discussed the letter received from Party A on April 28, 2009 and received an update from Evercore regarding some additional indications of general interest that had been received.

 

On May 1, 2009, the Independent Directors convened a meeting to discuss the possible adoption of a shareholder rights plan. This meeting was attended by representatives of WSGR and Evercore. At that meeting, representatives of WSGR reviewed with the members of the Board of Directors their fiduciary duties in the context of considering and adopting defensive measures. The Independent Directors then discussed the terms of the proposed shareholder rights plan and the fact that the plan would not prevent a sale of the Company but would merely encourage interested parties to negotiate with the Board of Directors and thereby aid the Board of Directors in maximizing value for all shareholders.

 

Also on May 1, 2009, at a regularly scheduled meeting attended by representatives of WSGR and Evercore, the Board of Directors adopted a shareholder rights plan. At that meeting, representatives of WSGR reviewed with the members of the Board of Directors their fiduciary duties in the context of considering and adopting defensive measures. Mr. Morin also provided the Board of Directors with an update on the M&A Committee’s activities and plans going forward, including the efforts to develop a long term strategic plan for the Company.

 

On May 18, 2009, Mr. Gupta issued a public statement and sent a letter to the Board of Directors criticizing the Board of Directors’ decision to adopt the shareholder rights plan and encouraging the Board of Directors to pursue strategic alternatives for the Company.

 

On May 20, 2009, the M&A Committee convened a meeting to discuss Mr. Gupta’s public statement. This meeting was attended by representatives of WSGR and Evercore. The M&A Committee and advisors engaged in extensive discussions regarding Mr. Gupta’s public statement.

 

On June 1, 2009, at a regularly scheduled M&A Committee meeting attended by representatives of WSGR and Evercore, the M&A Committee discussed the need for the Company to complete its long term strategic plan being prepared by management of the Company for the M&A Committee on a timeline that would allow for the evaluation of strategic alternatives in due course.

 

On June 1, 2009, the Independent Directors convened a meeting to discuss Mr. Gupta’s public statement and the related letter. This meeting was attended by representatives of WSGR and Evercore. At the meeting, the Independent Directors requested that WSGR draft a response to Mr. Gupta explaining that the Board of Directors’ adoption of the shareholder rights plan was designed to aid the Board of Directors in maximizing long-term value for all shareholders.

On June 16, 2009, at a regularly scheduled M&A Committee meeting attended by representatives of WSGR and Evercore, a representative of Evercore provided the M&A Committee with an update on recent discussions with a potential strategic partner. The M&A Committee and its advisors then engaged in discussions regarding what, if any, action should be taken with regard to the potential strategic partner.

 

On July 30, 2009, at a regularly scheduled M&A Committee meeting attended by representatives of WSGR and Evercore, a representative of Evercore provided the M&A Committee with an update regarding some additional general indications of interest that had been received. Evercore then provided the M&A Committee with a status update on its efforts, in coordination with management, to review and evaluate a finalized long term strategic plan for the Company being completed by management of the Company. At that meeting, Evercore also provided the M&A Committee with a general update on the status of the mergers and acquisitions market and financings thereof.

 

On July 31, 2009, at a regularly scheduled meeting attended by representatives of WSGR and Evercore, the Board of Directors requested that the M&A Committee arrange for Evercore to finalize its evaluation of the Company’s long term strategic plan; present their assessment of the current, and projected future, fair market value of the Company to the Board of Directors; present their assessment of third party interest in acquiring the Company to the Board of Directors; and outline for the Board of Directors a formal process for exploring the Company’s strategic alternatives, including a potential sale of the Company, with a view to maximizing shareholder value.

 

On August 12, 2009, at a regularly scheduled M&A Committee meeting attended by representatives of WSGR and Evercore, management presented the Company’s updated long term strategic plan to the M&A Committee, including a detailed analysis of the underlying assumptions and calculations as well as projected balance sheets and cash flow statements and other modifications as suggested to management of the Company by the M&A Committee. The M&A Committee then discussed the risks and challenges of the Company’s existing business plans and prospects, as well as the opportunities that such plans presented for the Company. Evercore then outlined for the M&A Committee its recommendation regarding a formal process for exploring the Company’s strategic alternatives. The M&A Committee and its advisors then further discussed strategic alternatives available to the Company (including a sale of the Company, a strategic merger or other business combination transaction, a recapitalization of the Company and continuing to execute on the Company’s existing business plans) and the preliminary financial analyses of such alternatives. The M&A Committee discussed each of these alternatives in detail, including the potential value that each alternative could generate for the Company and its stockholders, the attendant risks and challenges of each alternative, the potential disruption to the Company’s existing business plans and prospects occasioned by each alternative, and the likelihood of successfully executing each alternative. The M&A Committee also considered the timing of each alternative relative to the current business environment and the anticipated future business cycles of the Company’s businesses. The M&A Committee then determined that a meeting of the Board of Directors should be convened as soon as practicable to allow for further discussions and deliberation regarding the strategic alternatives available to the Company.

 

On August 25, 2009, the Board of Directors met to, among other things, review the Company’s recent financial performance and business plan with management, and consider and discuss potential strategic alternatives that might be available to the Company. This meeting was attended by representatives of WSGR and Evercore. First, representatives of WSGR reviewed with the Board of Directors certain legal matters, including the directors’ fiduciary duties in the context of considering strategic alternatives. The Company’s management team then reviewed the Company’s preliminary financial and operating results for July and the expected results for the remainder of the third quarter. The Board of Directors then discussed the risks and challenges of the Company’s existing business plans and prospects, as well as the opportunities that such plans presented for the Company. Evercore then reviewed with the Board of Directors its findings with respect to the direction provided to Evercore on July 31, 2009, including an evaluation of the Company’s long term strategic plan, valuation implications of that plan and potential strategic alternatives (including a sale of the Company, a strategic merger or other business combination transaction and continuing to execute on the Company’s existing business plans). Evercore then reviewed with the Board of Directors other parties that might be interested in an acquisition of, or significant investment in, the Company and, whether any such parties had the ability to engage in a transaction with the Company at that time. The Board of Directors then discussed each of the strategic alternatives in detail, including the potential value that each alternative could generate for the Company and its stockholders, the attendant risks and challenges of each alternative, the potential disruption to the Company’s existing business plans and prospects occasioned by each alternative, and the likelihood of successfully executing each alternative. The Board of Directors also considered the timing of each alternative relative to the current business environment and the anticipated future

business cycles of the Company’s businesses. After extensive discussion, the Board of Directors concluded that, given the substantial risks and uncertainty inherent in continuing to pursue the Company’s existing business plan the Company should engage Evercore to commence the preparation of the necessary information and materials in order to conduct a formal process to explore the Company’s strategic alternatives, including a potential sale of the Company, with a view to maximizing shareholder value. The Board of Directors selected Evercore based on their skill and experience in running such a process as well as Evercore’s familiarity with the Company and its business. The Board of Directors, however, reserved formal approval to commence any transaction process until the end of September, at which point the Board of Directors would reevaluate the historical and expected performance of the Company, the market conditions at that time and other factors that the Board of Directors deemed to be relevant to such a decision.

 

On September 8, 2009, at a regularly scheduled M&A Committee meeting attended by representatives of WSGR and Evercore, representatives of Evercore updated the M&A Committee on Evercore’s progress in drafting the confidential information memorandum to be provided to potential bidders prior to their submission of non-binding preliminary proposals for a transaction. The M&A Committee and its advisors also discussed the proposed process timeline. The M&A Committee decided that when the confidential information memorandum was close to completion, a draft would be provided to each member of the Board of Directors for review and comment.

 

On September 12, 2009, at a regularly scheduled M&A Committee meeting attended by representatives of WSGR and Evercore, representatives of Evercore presented an overview of the proposed timeline for a potential transaction and gave a summary of progress on the confidential information memorandum. The M&A Committee, representatives of Evercore and representatives of WSGR discussed Mr. Gupta and his participation in the transaction process. It was decided by the M&A Committee that, if bidders requested, Mr. Gupta would be made available to address questions regarding the businesses and operations of the Company, the M&A Committee decided, however, that Mr. Gupta would not answer questions regarding the transaction process, and that all conversations between Mr. Gupta and any bidder would be attended by Evercore. The M&A Committee also discussed the potential impact on the transaction process of the pending SEC investigation involving the Company and certain of its then current and former officers and directors.

 

On September 21, 2009, at a regularly scheduled M&A Committee meeting attended by representatives of WSGR and Evercore, representatives of Evercore presented a proposed list of approximately 44 potential bidders to be contacted in the transaction process, including approximately 20 strategic candidates and approximately 24 financial sponsors, including CCMP Capital Advisors, LLC. The M&A Committee discussed certain possible additions to the contact list. The M&A Committee also discussed the status of the pending SEC investigation involving the Company and certain of its then current and former officers and directors. Since early 2009 the Independent Directors, including the members of the M&A Committee, had been receiving regular updates from the Company regarding the status of the pending SEC investigation. The M&A Committee asked WSGR to review available information regarding the financial impact of the SEC investigation and provide a report to the M&A Committee at a later meeting. Members of the Company’s management reported on the progress of the confidential information memorandum and, based on this report, the M&A Committee decided that the confidential information memorandum should be finalized at the next scheduled M&A Committee meeting on September 29, 2009.

 

On September 23, 2009, at a special meeting of the Board of Directors attended by representatives of WSGR and Evercore, Mr. Morin reported that the M&A Committee anticipated delivering a draft of the confidential information memorandum to each member of the Board of Directors the next week.

 

On September 29, 2009, at a regularly scheduled M&A Committee meeting attended by representatives of WSGR and Evercore, the Company’s Executive Vice President for Business Conduct, General Counsel and Secretary updated the M&A Committee on the progress of the pending SEC investigation involving the Company and certain of its then current and former officers and directors. The M&A Committee discussed whether to proceed with the transaction process. Following this discussion, the M&A Committee unanimously decided to proceed with the transaction process and instructed Evercore to make contact with each of the potential bidders on the final list approved by the M&A Committee.

 

After receiving additional input and formal approval from the Board of Directors, during the period of October 1, 2009 through October 5, 2009, Evercore contacted 47 potential strategic and financial buyers, including CCMP Capital Advisors, LLC. As a result of these initial contacts, the Company executed confidentiality

agreements with 30 potential bidders, including seven strategic candidates and 23 financial sponsors, including a confidentiality agreement with CCMP Capital Advisors, LLC, dated October 13, 2009. These confidentiality agreements required, among other things, that all communication between each potential bidder and the Company’s management and Board of Directors, including Mr. Gupta, would be conducted through the M&A Committee.

 

On October 5, 2009, at a regularly scheduled M&A Committee meeting attended by representatives of WSGR and Evercore, representatives of Evercore updated the M&A Committee on the contacts it had made with potential bidders.

 

From October 5, 2009 to October 30, 2009, Evercore provided each party who had executed a confidentiality agreement with a confidential information memorandum and certain other information regarding the Company’s business and engaged in various conference calls with interested parties.

 

On October 12, 2009, at a regularly scheduled M&A Committee meeting attended by representatives of WSGR and Evercore, representatives of Evercore updated the M&A Committee on the transaction process. The M&A Committee, its advisors and members of the Company’s management then discussed the transaction process and certain related timing matters.

 

On October 15, 2009, at a special meeting of the Board of Directors attended by representatives of WSGR and Evercore, Mr. Morin provided an update of the status of the transaction process.

 

On October 19, 2009, at a regularly scheduled M&A Committee meeting attended by representatives of WSGR and Evercore, representatives of Evercore updated the M&A Committee on the transaction process to date, including a summary of initial due diligence questions posed by potential bidders. The M&A Committee then discussed and confirmed certain milestone transaction process dates, including the date for distribution of process guidelines, the deadline for preliminary proposals and the schedule for management presentations to potential bidders.

 

From October 19, 2009 to October 30, 2009, Evercore provided the 30 parties who had executed confidentiality agreements prior to October 30, 2009 with process guidelines which invited each party to submit a non-binding preliminary proposal for a transaction by November 3, 2009. The process guidelines further provided that the preliminary proposals must, among other things, specify the potential buyer’s per share equity value associated with the transaction, the proposed transaction structure and the sources of the financing required to close the transaction.

 

On October 20, 2009, the Company issued a press release announcing that the Company had reached “an agreement in principle” with the SEC Denver regional office, which, if approved by the SEC Commissioners, would resolve the pending SEC investigation. The potential bidders were advised that “an agreement in principle” had been reached with the SEC.

 

On October 26, 2009, at a regularly scheduled M&A Committee meeting attended by representatives of WSGR and Evercore, representatives of Evercore updated the M&A Committee on the transaction process, including a review of upcoming milestone dates. The M&A Committee then discussed the status of the pending SEC investigation involving the Company and certain of its then current and former officers and directors.

 

On October 31, 2009, the Omaha World Herald published a report that the Company had engaged Evercore to solicit bids for a transaction and that “at least 33 potential bidders” had signed confidentiality agreements to allow them access to the Company’s confidential information. The Omaha World Herald also reported the November 3, 2009 deadline for preliminary proposals. Subsequently, the Company’s share price increased nearly 17%, from $6.56 (closing share price on October 30, 2009) to $7.65 (closing share price on October 31, 2009).

 

On November 3, 2009, the deadline for preliminary proposals established by the Evercore process guidelines, or shortly thereafter, the Company received preliminary written proposals from ten financial sponsors. Each proposal provided for the purchase of all of the Company’s outstanding common stock for cash at prices ranging from $7.00 to $9.50 per share, with five of the proposals indicating a single per share value and the remaining five proposals indicating a range of per share values. Based on the high value of the preliminary proposals indicating a range, three of the proposals were above $8.00 per share, four of the proposals were at $8.00 per share and the remaining three proposals were below $8.00 per share. All of the proposals were non-binding and preliminary in

nature, were submitted without financing commitments, and were based on limited due diligence including none of the parties having had access to Company management between the commencement of the formal transaction in October 2009 and the submission of preliminary proposals.

 

On November 5, 2009, at a regularly scheduled M&A Committee meeting attended by representatives of WSGR and Evercore, Evercore provided the M&A Committee with a detailed summary of each of the ten preliminary proposals received to date. Representatives of Evercore reported that additional preliminary proposals might be received from one or more additional parties in the near future. Representatives of Evercore highlighted for the M&A Committee that all ten proposals were made by known, experienced and respected financial sponsors. Following discussion of the ten preliminary proposals received to date, the M&A Committee instructed Evercore to invite each of the ten potential bidders who had made proposals into the next stage of the transaction process, in which they would be allowed to complete a more thorough due diligence review of the Company and its business before formulating final binding proposals for a transaction. The M&A Committee also instructed Evercore to provide general feedback to the potential bidders whose proposals were on the lower end of the valuation range that they would have to increase their proposed equity prices to remain competitive. The M&A Committee also discussed certain logistical matters related to the upcoming management presentations.

 

On November 5, 2009, the Company received a preliminary written proposal from a strategic party to purchase all of the Company’s outstanding common stock for cash at a price of $8.50 per share. Following discussion of the additional preliminary proposal received, the M&A Committee instructed Evercore to invite the strategic party who had made the proposal into the next stage of the transaction process in which they would be allowed to complete a more thorough due diligence review of the Company and its business before formulating final binding proposals for a transaction.

 

From November 3, 2009 to November 11, 2009, Evercore was contacted by five additional potential bidders requesting inclusion in the process. As a result of these contacts, the Company executed confidentiality agreements with four additional parties, including two strategic candidates and two financial sponsors. Following execution of a confidentiality agreement, Evercore provided each of these additional parties with the same confidential information memorandum and other information about the Company’s business that had been provided to the other 30 parties who had previously executed confidentiality agreements. None of these additional parties submitted a preliminary written indication of interest.

 

On November 9, 2009, at a regularly scheduled M&A Committee meeting attended by representatives of WSGR and Evercore, representatives of Evercore updated the M&A Committee on the transaction process, focusing on feedback received from continuing transaction process participants. The M&A Committee discussed the recent increase in the Company’s stock price following the October 31, 2009 story in the Omaha World Herald. The M&A Committee also discussed the timing of Evercore’s update of its valuation of the Company’s business in relation to the completion and approval by the Board of Directors of the Company’s 2010 operating budget. Mr. Lee D. Roberts, who was elected to the Board of Directors on October 15, 2009, joined the M&A Committee for his first meeting.

 

On November 10, 2009, Reuters published a report that the Company had attracted first round bids from strategic candidates and private equity firms. Subsequently, the Company’s share price increased nearly 5.5%, from $7.96 (closing share price on November 10, 2009) to $8.40 (closing share price on November 11, 2009).

 

On November 16, 2009, at a regularly scheduled M&A Committee meeting attended by representatives of WSGR and Evercore, representatives of Evercore and members of the Company’s management updated the M&A Committee on the transaction process, including preparation and planning for the upcoming management presentations to potential bidders. The M&A Committee then discussed feedback from potential bidders reported by representatives of Evercore regarding the October 31, 2009 story in the Omaha World Herald. The M&A Committee decided to limit the number of recipients receiving internal communications with respect to the transaction process in an effort to prevent future unauthorized public reports.

 

From November 16, 2009 to December 17, 2009, one strategic candidate and nine financial sponsors who had executed confidentiality agreements and submitted preliminary proposals attended management presentations at which members of the Company’s management provided certain confidential financial and operational information

about the Company’s business and answered questions posed by the potential bidders. One financial sponsor who had submitted a preliminary proposal self-selected out of the process prior to attending a management presentation.

 

Beginning on November 18, 2009, the Company provided the 11 potential bidders from whom the Company had received preliminary proposals with access to an online data room, which included certain confidential legal, financial and operational information. The information in the online data room was continuously updated and supplemented with additional information throughout the process. Except for the one strategic participant, from whom sensitive competitive information was withheld, any additional information that was requested by any of the parties was added to the online data room for review by all parties still actively engaged in the process at that time.

 

On November 23, 2009, at a regularly scheduled M&A Committee meeting attended by representatives of WSGR and Evercore, members of the Company’s management and representatives of Evercore updated the M&A Committee on the recent management presentations to potential bidders and recent activity by potential bidders in the online data room. Evercore also reported that it had received requests from additional potential bidders to join the transaction process. After discussion and on Evercore’s advice, the M&A Committee decided to invite two additional potential bidders to join the transaction process, one strategic candidate and one financial sponsor.

 

On November 30, 2009, at a regularly scheduled M&A Committee meeting attended by representatives of WSGR and Evercore, members of the Company’s management and representatives of Evercore updated the M&A Committee on the transaction process, including the most recently completed management presentations to potential bidders. The M&A Committee discussed requests from certain potential bidders for meetings with Mr. Gupta and the logistics for accommodating these requests. The M&A Committee decided that all such meetings would be attended by one or more representatives of Evercore.

 

On December 7, 2009, at a regularly scheduled M&A Committee meeting attended by representatives of WSGR and Evercore, members of the Company’s management and representatives of Evercore updated the M&A Committee on the transaction process, including the most recent management presentations to potential bidders and recent activity in the online data room. The M&A Committee requested that Evercore continue to provide updates of online data room activity on a regular basis. Representatives of Evercore reported that two meetings between potential bidders and Mr. Gupta had been scheduled. The M&A Committee discussed the future of the Company’s relationship with Mr. Gupta in the event the transaction process did not result in a transaction. The M&A Committee noted that under the likely terms of Mr. Gupta’s settlement with the SEC, he would no longer be able to serve as a director of the Company and that his ability to vote his Company shares on matters submitted to a shareholder vote might be significantly restricted. This would mean that Mr. Gupta would no longer have access to the Company’s non-public information or a formal voice in the Company’s governance beyond his ability to vote his Company shares. The M&A Committee concluded that, as a result, Mr. Gupta’s ability to interfere with or disrupt the governance and management of the Company would be reduced.

 

On December 14, 2009, at a regularly scheduled M&A Committee meeting attended by representatives of WSGR and Evercore, members of the Company’s management updated the M&A Committee on the most recent management presentations to potential bidders, reporting that most of these presentations had gone well but that one financial sponsor had shown less interest than anticipated.

 

From December 14, 2009 to January 22, 2010, Mr. Gupta, along with representatives from Evercore, met with seven potential bidders, all of whom were financial sponsors, and answered their questions as part of the due diligence review process.

 

On December 17, 2009, at a regularly scheduled M&A Committee meeting attended by representatives of WSGR and Evercore, representatives of Evercore updated the M&A Committee on the transaction process and presented a general overview of recent merger, acquisition and capital market conditions. Representatives of Evercore also presented a detailed review of each of the potential bidders who continued to be engaged in the transaction process, including a summary of questions asked during due diligence, level of data room activity and general degree of interest exhibited by each potential buyer. The M&A Committee, representatives of Evercore and representatives of WSGR discussed the potential impact of the pending SEC investigation involving certain of the Company’s former officers and directors on the transaction process and the final proposals the Company might receive. The M&A Committee then discussed the unauthorized public release of information that resulted in the

stories in the Omaha World Herald and how the resulting increase in the Company’s stock price might be addressed by potential bidders in their final proposals. The M&A Committee also discussed possible courses of action in the event the transaction process did not result in any final proposals or if the final proposals the Company received were determined by the M&A Committee to be inadequate to recommend proceeding with a transaction.

 

On January 4, 2010, the M&A Committee met at Evercore’s New York offices to review matters related to the transaction process. This meeting was attended by representatives of WSGR and Evercore. The M&A Committee first discussed the progress of settlement discussions between Mr. Gupta and the SEC, including the potential impact such discussions could have on the transaction process and the interests that potential bidders would have in these matters. Next, representatives of Evercore made an extensive presentation regarding various matters related to the transaction process, including valuation and an update of the financial sponsors and strategic candidates that remained engaged in the process. Next, representatives of WSGR reviewed in detail a draft form of merger agreement that would be provided to potential bidders for comment and submission with final binding proposal packages. Following departure of the Evercore team, the M&A Committee met in executive session with WSGR, and discussed possible courses of action the M&A Committee and the Board of Directors might take depending on the nature of the final binding bids received, if any.

 

On January 11, 2010, at a regularly scheduled M&A Committee meeting attended by representatives of WSGR and Evercore, Evercore began the meeting by informing the M&A Committee that the one remaining strategic candidate had decided to withdraw from the process. Evercore confirmed that the financial sponsors discussed at the January 4, 2010 meeting of the M&A Committee remained engaged. Next, the M&A Committee discussed various potential courses of action related to the transaction process.

 

On January 14, 2010, Evercore distributed to the remaining bidders the process guidelines which invited each party to submit a definitive proposal for a transaction by Thursday, February 11, 2009. The process guidelines further provided that the definitive proposal must, among other things, include a review and, to the extent any changes are required by the bidder, mark-up of the draft merger agreement which accompanied the distribution of the process guidelines, as well as proof of financing.

 

On January 19, 2010, the M&A Committee held a regularly scheduled meeting attended by representatives of WSGR and Evercore. As the first order of business, the M&A Committee received an update on the status of Mr. Gupta’s settlement discussions with the SEC. Next, representatives of Evercore updated the M&A Committee on the status of discussions with the various financial sponsors that remained engaged in the process.

 

On January 25, 2010, at a regularly scheduled M&A Committee meeting attended by representatives of WSGR and Evercore, Mr. Siboni updated the M&A Committee on the status of Mr. Gupta’s settlement negotiations with the SEC. Next, representatives of Evercore updated the M&A Committee on the status of discussions with the financial sponsors that remained engaged in the transaction process.

 

On February 1, 2010, at a regularly scheduled M&A Committee meeting attended by representatives of WSGR and Evercore, representatives of WSGR opened the meeting by updating the M&A Committee on a recent discussion with Mr. Gupta’s SEC counsel. Mr. Gupta was close to reaching a settlement with the SEC, the anticipated terms of which were presented to the M&A Committee. As these matters were of interest to potential bidders, the M&A Committee requested that WSGR prepare a list of talking points to present to potential bidders as part of their due diligence review. Then representatives of Evercore updated the M&A Committee on the status of the potential bidders that remained active in the process.

 

On February 3, 2010, as part of CCMP’s due diligence review, members of the Company’s management and representatives of WSGR held a telephonic meeting with representatives of CCMP and CCMP’s legal counsel, O’Melveny & Myers, to discuss certain litigation and regulatory matters, including Mr. Gupta’s anticipated settlement with the SEC. During that meeting, representatives of the Company communicated that they expected the likely terms of Mr. Gupta’s settlement with the SEC to include (i) a bar from service as an officer or director of a public company for an unknown period of time and (ii) certain monetary payments.

 

On February 8, 2010, the M&A Committee held a regularly scheduled meeting attended by representatives of WSGR and Evercore. At the outset of the meeting, representatives of Evercore updated the M&A Committee on the status of the potential bidders that remained active in the process, noting that these parties continued to engage in

substantial due diligence efforts. Evercore also noted that final binding proposals were anticipated from these parties by February 11, 2010 (or shortly thereafter, as indicated by certain bidders). Evercore further responded to questions regarding parties that had curtailed their due diligence activities and were not expected to participate further in the process.

 

On February 11, 2010, a financial sponsor submitted a proposal expressing interest in pursuing a minority private investment in a public entity (PIPE) transaction with the potential bidder’s investment unspecified in amount.

 

On the morning of February 12, 2010, CCMP submitted a proposal to acquire all of the Company’s outstanding common stock at a price of $8.40 per share. Included with the CCMP proposal were a draft merger agreement, debt financing commitment letters from BofA, and a draft equity commitment letter. CCMP’s proposal also indicated that CCMP had completed its due diligence investigation of the Company and was prepared to move quickly to negotiate and sign definitive documentation for a transaction.

 

On the evening of February 12, 2010, Party A submitted a proposal to acquire all of the Company’s outstanding common stock at a price of $8.00 per share. Included with the Party A proposal were a draft merger agreement, debt financing commitment letters from BofA, and a draft equity commitment letter from certain Party A affiliates. Party A’s proposal also indicated that Party A had not completed its due diligence investigation of the Company and would need an additional three weeks to do so, during which period Party A would require exclusivity to perform its additional due diligence investigation.

 

On February 13, 2010, the M&A Committee convened a meeting attended by representatives of WSGR and Evercore. The M&A Committee and representatives of WSGR and Evercore undertook a preliminary discussion of the terms of the proposals received from CCMP, Party A and the financial sponsor proposing the PIPE transaction. The M&A Committee noted that the proposal for a PIPE transaction omitted to specify the material terms on which the proposed transaction would be completed, including any specific indication of the valuation on which the financial sponsor’s investment would be based. The M&A Committee concluded that the proposal for the PIPE transaction was merely an expression of interest in pursuing a PIPE transaction in the future rather than a firm proposal that could be evaluated and compared against the proposals from CCMP and Party A. In its preliminary review of the terms of the proposal from Party A, the M&A Committee discussed that in addition to being inferior to the CCMP proposal on price, Party A’s proposal included a number of terms that greatly increased the risk that a transaction with Party A might not ultimately be completed. Party A’s proposal was conditioned, for example, on Party A’s completion of a substantial additional due diligence review of the Company and its business which Party A anticipated would require three additional weeks to complete and during which Party A proposed the Company would be bound to negotiate exclusively with Party A. Party A also proposed merger agreement terms that were much less favorable to the Company than CCMP’s proposed merger agreement terms, including significant conditions to Party A’s obligation to complete the transaction as well as lesser restrictions on Party A’s ability to refuse to close the transaction post signing. The M&A Committee also noted that the debt commitment from Bank of America submitted by Party A was much more preliminary in nature than the debt commitment from BofA submitted by CCMP and therefore would require considerably more work in order to determine whether such financing was in fact available.

 

Between February 12, 2010 and February 16, 2010, representatives of both CCMP and Party A called representatives of Evercore to clarify their proposals and reiterate their strong interest in a transaction. No other party submitted proposals during this time. The 9 other parties that submitted preliminary proposals and performed additional due diligence on the Company but did not submit final proposals to acquire the Company (including the financial sponsor proposing the PIPE transaction) provided the following reasons, among others: (a) an inability to submit an offer at or above the market price at the time of such conversations (the closing share price of the Company on February 12, 2010, was $7.62), (b) a less favorable view relative to the Company management’s financial plan of the Company’s future growth prospects absent a material transformation of, and investment in, the business, with an associated high degree of execution risk, (c) a lack of comfort with the financial and strategic plans put forth by Company management given the perceived insufficient supporting detail for such plans and inadequate historical data regarding the business to benchmark and compare such future projections, (d) an increasingly competitive landscape with significantly reduced barriers to entry, (e) the disparate nature of the Company’s

portfolio of products and services, (f) a perceived need for senior management changes, and (g) limited bank financing available for an acquisition of the Company.

 

On February 16, 2010, the M&A Committee convened an in-person meeting at the San Mateo Marriott Hotel in San Mateo, California attended by representatives of WSGR and Evercore. As the first order of business, the Evercore team undertook an extensive presentation regarding various aspects and considerations related to the proposals received from CCMP, Party A and the financial sponsor proposing the PIPE transaction. Evercore also compared the proposals to the valuation analyses performed by Evercore in connection with the Company’s long term strategic plan. Following the Evercore presentation, WSGR presented to the M&A Committee a review of fiduciary duties, as well as a comparison of the legal terms of the CCMP and Party A proposals (including the terms and conditions of the merger agreements and collateral documents included with each of the proposals). The M&A Committee and its advisors discussed potential risks associated with the offers, including the need for completion by each of CCMP and Party A of substantial debt financing and the Company’s recourse under the proposed merger agreements if either CCMP or Party A were unable to obtain financing.

 

On February 17, 2010, the Board of Directors convened an in-person meeting at the San Mateo Marriott Hotel in San Mateo, California attended by representatives of WSGR and Evercore. Representatives of Evercore gave a detailed presentation summarizing the transaction process to date, current mergers and acquisition and capital market conditions, and the terms and conditions of the proposals received from CCMP, Party A and the financial sponsor proposing the PIPE transaction. Evercore also compared the proposals to the valuation analyses performed by Evercore in connection with the Company’s long term strategic plan. Following the Evercore presentation, representatives of WSGR gave a presentation on the Board of Directors’ fiduciary duties and the legal terms of the proposals received from CCMP and Party A. Representatives of WSGR then led a general discussion on the nature of, and risks attendant to financial sponsor transactions, including the need for debt financing. At the meeting, the M&A Committee also invited Mr. Gupta to express his views to the Board regarding a potential sale of the Company. After Mr. Gupta expressed his view that he was in support of the proposed transaction with CCMP, and would be willing to enter into a voting agreement related thereto, he left the meeting and the discussions of the subject continued without him. Following these presentations, the Board of Directors authorized the M&A Committee to negotiate with CCMP on a non-exclusive basis for transaction terms at least as favorable to the Company and its stockholders as those set forth in CCMP’s proposal, and to communicate to Party A that its proposal was significantly inferior to the leading proposal on price and other material terms, and that barring a new proposal, the Board of Directors of the Company would be moving forward with another party.

 

On February 17, 2010, representatives of WSGR and Evercore met to prepare a list of talking points for CCMP and Party A regarding their proposals and to develop a plan for negotiations with CCMP and communication with Party A.

 

On February 17, 2010, representatives of Evercore had conversations with CCMP and Party A. Representatives of Evercore asked CCMP to revise a limited number of the terms of its proposal, including price. Representatives of Evercore informed Party A that its proposal was significantly inferior to the leading proposal on price and other material terms, and that barring a new proposal, the Board of Directors would be moving forward with another party. Representatives of Party A indicated that it they would not be able to accommodate a shortened time frame to complete remaining due diligence, and were uncertain of their financing timing and terms. With regard to price, representatives of Party A indicated that they could potentially increase their proposal from $8.00 to a range of $8.25 to $8.35, only if further due diligence supported such a higher proposal. They also indicated a desire to discuss the opportunity with other potential bidders in order to facilitate a higher proposal.

 

On February 18, 2010, representatives of CCMP responded to Evercore’s comments on revised terms and price. CCMP communicated a willingness to revise their offer to $8.50, and then subsequently to $8.60, however, noted that BofA still had due diligence to complete on the debt commitment and that CCMP also needed to discuss the terms of the debt commitment letter with BofA. On February 19, 2010, WSGR provided O’Melveny & Myers with revised drafts of the merger agreement, BofA debt commitment letters and the other related transaction documents. WSGR also provided a draft voting agreement to O’Melveny & Myers and Mr. Gupta’s legal counsel, Latham & Watkins. Each of CCMP and Party A had requested that Mr. Gupta, the other members of the Board of Directors and certain executive officers of the Company enter into voting agreements pursuant to which, among

other matters, these individuals would agree to vote Company shares owned by them in favor of adoption of the merger agreement and against any competing transaction. O’Melveny & Meyers also provided a draft limited guarantee to WSGR, pursuant to which CCMP would agree, among other matters, to guarantee certain payment obligations under the merger agreement. On February 21, 2010, WSGR provided O’Melveny & Myers with comments to the draft limited guarantee.

 

On February 19, 2010 and February 20, 2010, representatives of CCMP and representatives of BofA had conversations with members of Company’s management and representatives of Evercore to review the Company’s January 2010 financial results. Revenue for the month fell short of budget by 2% and by 5% relative to prior year results. Earnings before interest, taxes, depreciation, amortization and one-time, non-recurring expenses (“Adjusted EBITDA”) was 20% lower than budget and 7% higher than prior year results.

 

On February 22, 2010, the Company was informed that the Omaha World Herald would be publishing an article reporting the proposed terms of the CCMP proposal. The specific timing of publication was not known but was anticipated to be within a few days.

 

On February 22, 2010, representatives of WSGR had a telephonic meeting with representatives of Latham & Watkins regarding the proposed terms of the voting agreement.

 

On February 22, 2010 and February 23, 2010, WSGR received revised drafts of the merger agreement, the limited guarantee, the equity commitment letter and the voting agreement from O’Melveny & Myers. Representatives of WSGR had a telephonic meeting with members of Company management to review the revised draft merger agreement and other transaction documents.

 

On February 22, 2010, representatives of BofA, in connection with BofA’s debt commitment letter to CCMP, along with representatives of CCMP, met with members of the Company’s management and representatives of Evercore at the Company’s offices in Omaha, Nebraska. The purpose of this meeting was to allow BofA to conduct further due diligence of the Company and its business. As part of this meeting, management reviewed the Company’s January 2010 results which, as noted above, lagged behind the Company’s budget.

 

On February 24, 2010, representatives of WSGR had a telephonic meeting with representatives of O’Melveny & Myers to negotiate the terms and conditions of the merger agreement and the other transaction documents.

 

On February 24, 2010, the M&A Committee convened a meeting attended by representatives of WSGR and Evercore. The M&A Committee discussed the report of the unauthorized article to be published by the Omaha World Herald reporting the terms of the proposal from CCMP. Representatives of Evercore then updated the M&A Committee on BofA’s February 22, 2010 due diligence meeting in Omaha, Nebraska with members of Company management and representatives of Evercore. Representatives of Evercore also updated the M&A Committee on the progress of CCMP’s negotiations with BofA for finalization of BofA’s debt commitment letter for the proposed transaction. Representatives of WSGR then updated the M&A Committee on the status of merger agreement negotiations with O’Melveny & Myers, reporting that there were a limited number of unresolved issues. These unresolved issues included the circumstances under which CCMP would be required to pay the Company a termination fee upon termination of the merger agreement.

 

On February 25, 2010 and February 26, 2010, representatives of WSGR, O’Melveny & Myers and members of the Company’s management held telephonic meetings to discuss the disclosure schedules to the merger agreement. Representatives of CCMP continued to contact Evercore to provide updates and discuss remaining legal and financial process items. In addition, on February 25, 2010 representatives of CCMP held an additional conference call with members of the Company’s management and representatives of Evercore to further discuss the January 2010 financial results, including a detailed review of the financial results by business unit. In addition, representatives of CCMP had conversations with members of the Company’s management and representatives of Evercore to review the Company’s updated first quarter 2010 financial forecast, which included January actual financial performance. Revenue for the first quarter 2010 was forecasted to be down relative to budget.

 

On February 26, 2010, the Omaha World Herald published an article reporting the proposed terms of the CCMP proposal.

On February 27, 2010, the M&A Committee convened a meeting attended by representatives of WSGR and Evercore. Representatives of Evercore updated the M&A Committee on the status of BofA’s due diligence investigation, noting that BofA was going to seek internal credit committee approval for its debt commitment to CCMP. Representatives of WSGR reviewed the status of the outstanding issues on the draft merger agreement and the status of negotiations regarding Mr. Gupta’s voting agreement.

 

On February 28th, Evercore received communication from representatives of Party A reiterating their interest in the Company under the terms of their proposal delivered February 12, 2010 should negotiations with CCMP terminate. This communication from Party A was the first received by Evercore since February 17, 2010.

 

On March 2, 2010, the M&A Committee convened a meeting attended by representatives of WSGR and Evercore. Representatives of Evercore updated the M&A Committee on the status of negotiations with CCMP, noting the limited set of legal issues that remained unresolved and also noting that BofA had not yet finalized its internal credit committee approvals and that CCMP continued to negotiate the terms of the commitment and covenants. WSGR reviewed for the M&A Committee the current status of the merger agreement and ancillary agreement negotiations, outlining the remaining unresolved issues, including the circumstances under which CCMP would be obligated to pay the Company a termination fee upon termination of the merger agreement, the definition of a “superior proposal” and the circumstances under which the Company would be obligated to pay a termination fee to Parent upon termination of the merger agreement. Representatives of WSGR also reported that the final terms of Mr. Gupta’s voting agreement had not yet been agreed upon and that these provisions continued to be negotiated. Next, it was noted that one of the conditions to funding of BofA’s debt commitment letter would be that the Company satisfy a stipulated minimum debt to EBITDA ratio. Mr. Oberdorf reviewed for the M&A Committee the requirements of this condition and the current expectations regarding the Company’s ability to satisfy this condition.

 

On March 2, 2010, the Board of Directors convened a meeting attended by representatives of WSGR and Evercore. Representatives of Evercore updated the Board of Directors on the current status of negotiations with CCMP including the status of the proposed debt financing with BofA. Representatives of WSGR reviewed for the Board of Directors the terms and conditions of the proposed definitive agreements including the merger agreement, the equity and debt commitment letters, the guarantee and the voting agreements, highlighting the remaining unresolved legal and business issues.

 

On March 3, 2010, management of the Company provided to representatives of CCMP preliminary revenue results for the month of February, which fell short of the revenue budget for February 2010 by approximately 2% and was 3% lower than prior year results. On March 4, 2010, representatives of CCMP held a conference call with members of Company’s management and representatives of Evercore to discuss February 2010 preliminary revenue results to evaluate the shortfalls in year-to-date financial results relative to budget and the implications for the financial forecast for the remainder of fiscal year 2010 as well as to discuss the significant underperformance of one of the Company’s business units.

 

On March 4, 2010, representatives of WSGR had telephone conversations with representatives of O’Melveny & Myers in an effort to resolve the remaining unresolved issues on the merger agreement and the other transaction documents. Later that afternoon, representatives of CCMP called Evercore to inform them that they were lowering their proposed price to $7.60 per share. CCMP informed Evercore that the change in price was based on (i) year-to-date financial performance of the Company through February 2010 that was materially below budget, (ii) limited evidence to support the Company’s ability to achieve the 2010 budget, (iii) feedback from BofA that indicated revised terms of the debt commitment would be less favorable to CCMP than provided for at the time of the original offer submitted on February 12, 2010, and (iv) additional liabilities of the Company discovered by CCMP during the course of its due diligence review. As context, the financing proposal provided for the original offer submitted on February 12, 2010 included $350 million of funded debt in the form of a secured term loan, whereas the verbal indication of a revised per share price of $7.60, pending BofA receiving final internal approval, provided on March 4, 2010 included a reduced debt commitment from BofA that included $315 million of funded debt in the form of a secured term loan. In addition, the terms of the debt commitment associated with the revised offer were also less favorable than those associated with the original offer. As a result of the above factors, CCMP stated that it could no longer support the previously proposed offer price of $8.60 per share and was, therefore, lowering its proposed price. That evening, the M&A Committee had a telephonic meeting attended by

representatives of WSGR and Evercore. Representatives of Evercore informed the M&A Committee of the proposed price reduction. Representatives of Evercore also reported that BofA’s internal credit committee was scheduled to review and approve the BofA debt commitment letter to CCMP the following day. Representatives of Evercore and the M&A Committee discussed CCMP’s stated reasons for the proposed price reduction. The M&A Committee discussed the possibility and capability of Party A to improve upon its initial $8.00 per share proposal. Representatives of Evercore reported that in a telephone conversation with representatives of Party A earlier in the day, the representatives of Party A had indicated that Party A would still require an additional 2 to 3 weeks of diligence prior to being in a position to enter into an agreement for a transaction. Party A further indicated that they maintained their proposal at $8.00 and that should negotiations with CCMP subsequently terminate, Party A’s proposal would likely be reduced. Party A also indicated no further substantial discussions with financing sources, including BofA. After extensive discussion with WSGR and Evercore, the M&A Committee directed Evercore to inform CCMP that the Company was immediately closing down all discussions with CCMP as a result of the price reduction. Representatives of Evercore informed CCMP by telephone that the Company had decided to conclude discussions with CCMP regarding a transaction.

 

On the morning of March 6, 2010, O’Melveny & Myers, on behalf of CCMP, provided WSGR with an updated proposal package including a revised merger agreement and ancillary documents reflecting the reduction in price to $7.60. The proposal also included final signed debt commitment letters from BofA. The terms in the signed debt commitment letters from BofA were materially different from the terms of the debt commitment letters submitted on February 12, 2010 as result of BofA completing its due diligence and receiving final internal approval on March 5, 2010. The commitment letters submitted on February 12, 2010 and March 6, 2010 were different in the following material respects: (i) the amount of term loans committed to fund a part of the Merger consideration was reduced by 10%, or $35 million, from $350 million to $315 million, (ii) the amount of the Company’s pro forma capitalization required to be funded as cash equity was increased from 40% to 45% and (iii) the definition of EBITDA and permitted add-backs specified in the March 6, 2010 letter resulted in a calculation of EBITDA that was less than the EBITDA BofA had used for the initial indication of a $350 million term loan, as described more fully below. As a result of the price reduction and at the direction of the M&A Committee, WSGR did not respond to O’Melveny & Myers.

 

CCMP contacted Evercore and informed them that the revision in the terms offered by BofA was in part due to the recent financial and operating performance and revised first quarter 2010 projections provided by the Company following the bid date on February 12, 2010, which were below budget and the projections provided by the Company as recently as January 20, 2010, as well as BofA’s overall assessment and outlook for the Company and BofA’s review of the Company’s quality of earnings which resulted in modifications to the definition of EBITDA, particularly related to a reduction in non-GAAP add-backs, which constituted approximately 45% of the Company’s EBITDA even after BofA’s modifications to the definition.

 

Both the February 12, 2010 and March 6, 2010 debt commitments of BofA included a condition that the Company’s consolidated debt to EBITDA ratio is no greater than 3.75:1.0 on the closing date based on EBITDA for the last four quarters ending prior to the closing date. At the time the February 12, 2010 debt commitments were made, BofA had not completed its accounting due diligence of the Company, and the completion of this due diligence was included as a condition to funding in the February 12, 2010 debt commitment letter. As a result, BofA’s debt commitment submitted on February 12, 2010 left the calculation of EBITDA to be “defined in a manner reasonably acceptable to [BofA].” By the time that BofA’s March 6, 2010 debt commitment was submitted, BofA had completed its accounting due diligence and had made its determination of what it believed were appropriate non-GAAP add-backs to be included in the definition of EBITDA, which resulted in an EBITDA amount that was lower than what had been assumed for purposes of the February 12, 2010 debt commitment. The effect of this lower EBITDA amount was the reduction in the debt committed by BofA described above as BofA was previously willing to commit to a term loan sized to approximately 3.5 times EBITDA.

 

On March 6, 2010, representatives of CCMP contacted representatives of Evercore in order to increase their proposed price to $7.80 per share, indicating that CCMP was prepared to work toward reaching final agreement prior to the open of NASDAQ trading on March 8, 2010. Evercore, based on standing instructions from the M&A Committee, again informed CCMP that the offered price was insufficient to reengage.

 

On March 7, 2010, representatives of CCMP indicated to representatives of Evercore that CCMP might be willing to accept provisions in the merger agreement that would allow the Company to solicit alternative offers for a limited period of time after signing the merger agreement. The M&A Committee convened a meeting attended by representatives of Evercore and WSGR. Representatives of Evercore updated the M&A Committee on the recent events, its discussions with CCMP and the increase of the price to $7.80 and the possibility of including “go shop” provisions in the merger agreement. After considerable discussion, the M&A Committee instructed Evercore to inform CCMP that should they agree to increase the offered price to $8.00 per share and agree to a 21 day “go shop” period, the M&A Committee would resume negotiations to resolve the other remaining open issues. Subject to CCMP’s agreement to these final terms, the M&A Committee resolved unanimously to recommend that the Board of Directors approve the transaction. Later that same day, the Board of Directors convened a meeting to consider the final proposal from CCMP. Evercore summarized the recent events leading up to the meeting including CCMP’s proposed reduction in price and the stated causes, and the subsequent discussions. Evercore then informed the Board of Directors that CCMP had agreed to increase its offered price to $8.00 per share and to a 21 day “go shop” period during which the Company would be allowed to solicit alternative offers. WSGR then summarized for the Board of Directors the terms and conditions of the definitive agreements for the proposed transaction. Next, Evercore reviewed for the Board of Directors its updated financial analysis of the $8.00 per share of Company Common Stock offered by CCMP. Following questions and discussion, Evercore delivered an oral opinion to the effect that, as of that date and based on and subject to assumptions made, matters considered and limitations “of” or “on” the scope of review undertaken by Evercore as set forth in its written opinion, the cash consideration (as defined in the opinion) was fair, from a financial point of view, to the holders of the shares of Company Common Stock entitled to receive such consideration. After considering (i) a variety of business, financial and market factors, (ii) the updated financial analyses of Evercore, including the opinion of Evercore, (iii) each of the factors considered by the M&A Committee in its unanimous recommendation as described below and (iv) the unanimous recommendation of the M&A Committee, the Board of Directors unanimously adopted the resolutions approving the transaction and the Merger Agreement and authorized the M&A Committee to work with Evercore and WSGR to finalize and prepare for execution the definitive documents. The full text of the written opinion of Evercore, dated March 8, 2010, which sets forth the assumptions made, procedures followed and matters considered and limitations on the review undertaken in connection with the opinion, is attached as Annex B to this proxy statement.

 

Later that evening and again on the morning of March 8, the M&A Committee convened to receive an update from WSGR regarding the final preparations for signing.

 

On the morning of March 8, 2010, the Company and Parent and Acquisition Sub, entities formed by CCMP to effect the transaction, entered into the Merger Agreement, CCMP delivered its equity commitment letter and limited guarantee, and BofA delivered its debt commitment letters. Shortly thereafter, the Company announced the transaction by a press release dated March 8, 2010.

 

The Merger Agreement provided that, until 11:59 p.m. (Eastern) on March 29, 2010, the Company was allowed to initiate, solicit and encourage any alternative acquisition proposals from, provide non-public information to, and participate in discussions and negotiate with third parties with respect to acquisition proposals. At the direction of the Board of Directors, Evercore conducted this go-shop process on behalf of the Company. During the process, Evercore contacted 10 parties (other than CCMP) who had submitted preliminary written proposals in early November 2009, including Party A. Of this group, only Party A expressed an interest continuing to evaluate the opportunity. In addition, one unsolicited financial buyer expressed an interest in receiving confidential information in order to evaluate the Company, and entered into a non-disclosure agreement. Neither Party A nor this additional unsolicited party expressed an interest in making an acquisition proposal for the Company.

 

On the afternoon of March 8, 2010, Mr. Gupta resigned form the Board of Directors. Mr. Gupta did not advise the Company of the reasons for his resignation, but the Company notes such factors as Mr. Gupta’s anticipated ban from serving as a director of a public company and Mr. Gupta’s need to satisfy his financial obligations to the SEC and others as permitted under his Voting Agreement.

 

On March 15, 2010, the Company’s proposed settlement with the SEC was approved by the SEC. The SEC Order included findings that the Company materially understated the compensation of its former CEO and Chairman, Vinod Gupta, in the company’s 2004 through 2007 Forms 10-K, which incorporated its proxy statements

by reference and that the Company’s filings for fiscal years 2003 through 2005 also understated, mischaracterized, or omitted certain related party transactions involving various entities owned by Mr. Gupta.

 

The Company did not admit or deny the findings in the Order. The Order prohibits the Company from future violations of Sections 13(a), 13(b)(2)(A), 13B(2)(B) and 14(a) of the Securities Exchange Act of 1934 and related rules requiring that periodic filings be accurate, that accurate books and records and a system of internal accounting controls be maintained and that solicitations of proxies comply with the securities laws.

 

On March 17, 2010, Mr. Gupta’s settlement of the related SEC complaint against him was approved by order of the United States District Court for the District of Nebraska (the “Final Judgment”).

 

The Final Judgment, among other things, contained sanctions and fines against Mr. Gupta, pursuant to which he is:

 

(1) prohibited from future violations of multiple provisions of the securities laws;

 

(2) barred for life from serving as an officer or director of a public company;

 

(3) required to vote his shares of Common Stock in the same proportion as other shareholders vote on the same issue, but there is an exception to this requirement for the shareholder vote on the proposed acquisition of the Company by CCMP, which allows Mr. Gupta to vote all his shares in favor of that proposal and another exception which allows him to vote against any other acquisition proposal if Mr. Gupta would receive an amount or form of consideration in any such transaction less than the Company shareholders generally;

 

(4) required to pay a civil penalty to the United States Treasury in the amount of $2,240,700 (plus post-judgment interest); and

 

(5) required to pay the Company $4,045,000, prejudgment interest of $1,145,400, for a total of $5,190,400 (plus post-judgment interest).

 

M&A Committee

 

The M&A Committee, consisting solely of independent directors and acting with the advice and assistance of independent legal and financial advisors, evaluated and negotiated the Merger proposal, including the terms and conditions of the Merger Agreement, with Parent and Acquisition Sub. The M&A Committee determined that the Merger is in the best interests of the Company and its stockholders, declared it advisable to enter into the Merger Agreement and unanimously recommended that the Board of Directors (i) approve the execution, delivery and performance of the Merger Agreement and the consummation of the transactions contained therein and (ii) resolve to recommend that the stockholders of the Company approve the adoption of the Merger Agreement.

 

In the course of reaching its determination, the M&A Committee considered the following factors and potential benefits of the Merger, each of which the members of the M&A Committee believed supported its decision:

 

 

 

second round, ultimately requesting final bids from all parties still involved in the process, and facilitating a go-shop process subsequent to the transaction announcement;

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The M&A Committee also considered a variety of risks and other potentially negative factors concerning the Merger Agreement and the Merger, including the following:

 

 

 

 

This discussion summarizes the material factors considered by the M&A Committee in its consideration of the Merger. After considering these factors, the M&A Committee concluded that the positive factors relating to the Merger Agreement and the Merger significantly outweighed the potential negative factors. In view of the wide variety of factors considered by the M&A Committee, and the complexity of these matters, the M&A Committee did not find it practicable to quantify or otherwise assign relative weights to the foregoing factors. In addition, individual members of the M&A Committee may have assigned different weights to various factors. The M&A Committee unanimously approved and recommended the Merger Agreement and the Merger based upon the totality of the information presented to and considered by it. The M&A Committee believes that the Merger is in the best interests of the Company and its stockholders.

 

The Board of Directors

 

The Board of Directors, acting upon the unanimous recommendation of the M&A Committee, unanimously (i) determined that the Merger is in the best interests of the Company and its stockholders, and declared it advisable, to enter into the Merger Agreement; (ii) approved the execution and delivery of the Merger Agreement, the performance by the Company of its covenants and agreements contained in the Merger Agreement and the

consummation of the transactions contemplated thereby, including the Merger, upon the terms and subject to the conditions contained in the Merger Agreement; and (iii) resolved to recommend that the stockholders approve the adoption of the Merger Agreement and directed that such matter be submitted for consideration of the stockholders of the Company at the special meeting.

 

In reaching these determinations, the Board of Directors considered (i) a variety of business, financial and market factors; (ii) the financial presentation of Evercore, including the opinion of Evercore as to the fairness, from a financial point of view, to the stockholders of the consideration to be received as a result of the Merger; (iii) each of the factors considered by the M&A Committee in its unanimous recommendation, as described above; and (iv) the unanimous recommendation of the M&A Committee.

 

The foregoing discussion summarizes the material factors considered by the Board of Directors in its consideration of the Merger. In view of the wide variety of factors considered by the Board of Directors, and the complexity of these matters, the Board of Directors did not find it practicable to quantify or otherwise assign relative weights to the foregoing factors. In addition, individual members of the Board of Directors may have assigned different weights to various factors. The Board of Directors unanimously approved and recommended the Merger Agreement and the Merger based upon the totality of the information presented to and considered by it.

 

The Board of Directors believes that the Merger is in the best interests of the Company and its stockholders and recommends that the stockholders approve the adoption of the Merger Agreement.

 

The Board of Directors recommends that you vote “FOR” the adoption of the Merger Agreement.

 

Opinion of Evercore

 

Evercore was engaged to render an opinion to the infoGROUP board of directors as to whether the cash consideration (as defined in the opinion) to be received by the holders of the shares of infoGROUP Common Stock entitled to receive such cash consideration pursuant to the Merger Agreement was fair, from a financial point of view, to such holders as of March 8, 2010. On March 7, 2010 at a meeting of the infoGROUP board of directors, Evercore delivered to the infoGROUP board of directors an oral opinion, which was subsequently confirmed by delivery of a written opinion dated March 8, 2010, to the effect that, as of that date and based on and subject to assumptions made, matters considered and limitations “of” or “on” the scope of review undertaken by Evercore as set forth therein, the cash consideration was fair, from a financial point of view, to the holders of the shares of infoGROUP Common Stock entitled to receive such cash consideration.

 

The full text of Evercore’s written opinion, dated March 8, 2010, which sets forth, among other things, the procedures followed, assumptions made, matters considered and limitations “of” or “on” the scope of review undertaken in rendering its opinion, is attached as Annex B to this proxy statement and is incorporated by reference in its entirety into this proxy statement. You are urged to read Evercore’s opinion carefully and in its entirety. Evercore’s opinion was directed to the infoGROUP board of directors and addresses only the fairness, from a financial point of view, of the cash consideration to the holders of the shares of infoGROUP Common Stock entitled to receive such cash consideration. For purposes of its opinion, Evercore noted that pursuant to the Merger Agreement each share of infoGROUP Common Stock, other than shares of infoGROUP Common Stock owned by infoGROUP, Parent, Acquisition Sub or any direct or indirect wholly owned subsidiary of infoGROUP, Parent, Acquisition Sub and any dissenting shares (as defined in the Merger Agreement), is to be converted into the right to receive $8.00 in cash. The opinion does not address any other aspect of the proposed Merger and does not constitute a recommendation to the infoGROUP board of directors, to any holder of shares of infoGROUP Common Stock or to any other persons in respect of the proposed Merger, including as to how any holder of shares of infoGROUP Common Stock should vote or act in respect of the proposed Merger. Evercore’s opinion does not address the relative merits of the proposed Merger as compared to other business or financial strategies that might be available to infoGROUP, nor does it address the underlying business decision of infoGROUP to engage in the proposed Merger.

In connection with rendering its opinion, Evercore, among other things:

 

 

For purposes of its analysis and opinion, Evercore assumed and relied upon, without undertaking any independent verification of, the accuracy and completeness of all of the information publicly available and all of the information supplied or otherwise made available to, discussed with, or reviewed by Evercore, and Evercore assumed no liability therefor. For purposes of rendering Evercore’s opinion, members of the management of infoGROUP provided Evercore the Management Projections, as well as reviewed and approved for use in connection with Evercore’s opinion and analyses the Financial Forecast. With respect to the Management Projections, Evercore assumed with infoGROUP’s consent that they were reasonably prepared on bases reflecting the best currently available estimates and good faith judgments of the management of infoGROUP as to the future competitive, operating and regulatory environments and related financial performance of infoGROUP under the alternative business assumptions reflected therein. With respect to the Financial Forecast, management of infoGROUP informed Evercore that this projected financial data collectively reflects a reasonable representation of the future financial performance of infoGROUP that incorporates the effects of potential risks and opportunities relating to infoGROUP’s business. Evercore expressed no view as to any projected financial data relating to infoGROUP or the assumptions on which they are based.

 

For purposes of rendering its opinion, Evercore assumed, in all respects material to its analysis, that the representations and warranties of each party contained in the Merger Agreement were true and correct, that each party will perform all of the covenants and agreements required to be performed by it under the Merger Agreement and that all conditions to the consummation of the proposed Merger will be satisfied without material waiver or modification thereof. Evercore further assumed that all governmental, regulatory or other consents, approvals or releases necessary for the consummation of the proposed Merger will be obtained without any material delay, limitation, restriction or condition that would have an adverse effect on infoGROUP or the consummation of the

proposed Merger or materially reduce the benefits of the proposed Merger to the holders of infoGROUP Common Stock. Evercore also assumed that the final form of the Merger Agreement will not differ in any material respect from the latest draft of the Merger Agreement reviewed by Evercore. Further, for the purposes of this opinion, with the infoGROUP board of directors’ approval, Evercore did not analyze any tax-related costs or benefits arising out of the proposed Merger.

 

Evercore did not make nor assume any responsibility for making any independent valuation or appraisal of the assets or liabilities (contingent or otherwise) of infoGROUP, nor was Evercore furnished with any such valuations or appraisals, nor did Evercore evaluate the solvency or fair value of infoGROUP under any state or federal laws relating to bankruptcy, insolvency or similar matters. Evercore’s opinion was necessarily based upon information made available to it as of the date of the opinion and financial, economic, market and other conditions as they existed and as could be evaluated on the date of its opinion. It should be understood that subsequent developments may affect Evercore’s opinion and that Evercore has no obligation to update, revise or reaffirm its opinion.

 

Evercore was not asked to pass upon, and expressed no opinion with respect to, any matter other than the fairness to the holders of shares of infoGROUP Common Stock entitled to receive such cash consideration, from a financial point of view, of the cash consideration, as of the date of its opinion. Evercore did not express any view on, and its opinion did not address, the fairness of the proposed Merger or any other matter with respect to, or any consideration received in connection therewith by, the holders of any other securities, creditors or other constituencies of infoGROUP, nor as to the fairness of the amount or nature of any compensation to be paid or payable to any of the officers, directors or employees of infoGROUP, or any class of such persons, whether relative to the cash consideration or otherwise. Evercore’s opinion did not address the relative merits of the proposed Merger as compared to other business or financial strategies that might be available to infoGROUP, nor did it address the underlying business decision of infoGROUP to engage in the proposed Merger. Evercore’s opinion did not constitute a recommendation to the infoGROUP board of directors, any holder of shares of infoGROUP Common Stock or to any other persons in respect of the proposed Merger, including as to how any holder of shares of infoGROUP Common Stock or any other person should vote or act in respect of the proposed Merger. Evercore expressed no opinion as to the price at which shares of infoGROUP would trade at any time. Evercore’s opinion noted that it is not a legal, regulatory, accounting or tax expert and that it assumed the accuracy and completeness of assessments by infoGROUP and its advisors with respect to legal, regulatory, accounting and tax matters.

 

Except as described above, the infoGROUP board of directors imposed no other instructions or limitations on Evercore with respect to the investigations made or the procedures followed by Evercore in rendering its opinion. Evercore’s opinion was only one of many factors considered by the infoGROUP board of directors in its evaluation of the proposed Merger and should not be viewed as determinative of the views of the infoGROUP board of directors or infoGROUP management with respect to the proposed Merger or the cash consideration payable in the proposed Merger.

 

Set forth below is a summary of the material financial analyses reviewed by Evercore with the infoGROUP board of directors on March 7, 2010 in connection with rendering its opinion. The following summary, however, does not purport to be a complete description of the analyses performed by Evercore. The order of the analyses described and the results of these analyses do not represent relative importance or weight given to these analyses by Evercore. Except as otherwise noted, the following quantitative information, to the extent that it is based on market data, is based on market data that existed on or before March 5, 2010 (the last full trading day prior to March 8, 2010, the date on which the infoGROUP board of directors adopted a resolution to approve the proposed Merger), and is not necessarily indicative of current market conditions.

 

The following summary of financial analyses includes information presented in tabular format. These tables must be read together with the text of each summary in order to understand fully the financial analyses. The tables alone do not constitute a complete description of the financial analyses. Considering the tables below without considering the full narrative description of the financial analyses, including the methodologies and assumptions underlying the analyses, could create a misleading or incomplete view of Evercore’s financial analyses.

 

Summary of Managements Projections and the Financial Forecast.  Below is a summary of the Management Projections for the 2010 period that were prepared and furnished to Evercore by management of infoGROUP, as well as the Financial Forecast for the 2011 to 2014 periods relating to infoGROUP that were reviewed and approved by management of infoGROUP for use in connection with Evercore’s opinion and analyses, and for which management of infoGROUP informed Evercore were reasonable:

 

 

Adjusted EBITDA is calculated by adding back to EBITDA (earnings before interest, taxes, depreciation and amortization) those expenses Company management deemed to be one-time and non-recurring in nature including, among others, certain restructuring costs, impairments and write-down of assets, litigation charges, and expenses related to the SEC investigation. For the 2010 period, Company management forecasted $13.1 million of such one-time, non-recurring expenses that have been excluded in Adjusted EBITDA. There were no one-time, non-recurring expenses projected by management of the Company for the 2011 to 2014 periods. In 2009, $39.9 million of expenses were deemed by management of the Company to be one-time and non-recurring in nature. Based on information provided to Evercore by management of the Company, projected trailing latest four quarters (“LFQ”) EBITDA and Adjusted EBITDA of infoGROUP as of March 31, 2010 used in Evercore’s opinion and analyses were $61.7 million and $96.0 million, respectively.

 

Historical Trading Analysis.  Evercore reviewed the historical prices of infoGROUP Common Stock over a two-year period ending March 5, 2010 (the last trading day before infoGROUP announced the proposed Merger), calculated the average daily closing prices of infoGROUP Common Stock over various time periods, and noted the closing stock price on selected dates including and prior to March 5, 2010. Evercore selected a two-year period based on its professional judgment and experience, taking into account market conditions and prior practices. Evercore then calculated and compared the premium (or discount, as the case may be) that the $8.00 per share cash consideration represented relative to the daily closing and average daily closing prices of infoGROUP Common Stock for the selected periods and dates. The following historical infoGROUP Common Stock price analysis was presented to the infoGROUP board of directors to provide it with background information and perspective with respect to the historical share price of infoGROUP Common Stock relative to the implied per share cash consideration:

 

 

 

 

 

Evercore reviewed historical prices of infoGROUP Common Stock over one and two year periods ending March 5, 2010 and noted the percentage of days where infoGROUP’s closing stock price fell between $3.00 and $11.00 in increments of $1.00. Evercore selected a two-year period based on its professional judgment and experience, taking into account market conditions and prior practices. Evercore noted that infoGROUP’s closing stock price exceeded $8.00 on approximately 22.5% of the days traded in the year ended March 5, 2010 and never exceeded $8.00 from the period between March 5, 2009 and October 30^, 2009, the last trading day before publication of media reports of a potential sale of infoGROUP. The following historical percentage days traded analysis was presented to the infoGROUP board of directors:

 

 

 

 

Evercore also noted, based on publicly available estimates, that the multiples of infoGROUP’s total enterprise value (“TEV”), calculated as equity market value based on closing stock prices, plus debt, preferred stock and minority interests, less cash and cash equivalents, to the average estimated one-year forward EBITDA during a one-year, two-year and three-year historical period ending March 5, 2010 were approximately 5.5x, and 5.1x and 5.6x, respectively. In connection with this analysis, Evercore noted that the $8.00 per share cash consideration corresponded to an implied multiple of TEV to 2010 Adjusted EBITDA of 6.2x, which was higher than the historical average multiple during the past three years.

 

Analysis of Select Publicly Traded Companies.  In order to assess how the public market values shares of similar publicly traded companies, Evercore reviewed and compared specific financial and operating data relating to infoGROUP to that of a group of selected companies that Evercore deemed to have certain characteristics that are similar to those of infoGROUP. As part of its analysis, Evercore calculated and analyzed the multiple of TEV as of March 5, 2010 to estimated 2009 and 2010 EBITDA for each member of a selected group of public traded companies deemed relevant for the purposes of this analysis. For infoGROUP, Evercore calculated such multiples based on both EBITDA and Adjusted EBITDA given the magnitude of the one-time, non-recurring expenses deemed as such by management of the Company. Evercore calculated the TEV of each company as equity market value based on closing stock prices, plus debt, preferred stock and minority interests, less cash and cash equivalents.

 

Multiples for the selected publicly-traded companies were based on publicly available filings. infoGROUP metrics for 2009 and 2010 financial forecasts were provided by the management of infoGROUP. The companies

that Evercore deemed to have certain characteristics similar to those of infoGroup and the multiples that Evercore calculated for such companies are summarized below:

 

 

 

 

 

Evercore then applied a range of selected multiples derived from the selected publicly-traded companies of 5.5x to 7.0x to the LFQ Adjusted EBITDA of infoGROUP as of March 31, 2010, as provided by management of the Company. Evercore derived these ranges of selected multiples based on its professional judgment and experience, including its judgment on business characteristics of infoGROUP relative to the other companies listed above, and other factors, including, but not limited to, historical financial performance, profitability and scale of business. Evercore noted, however, that none of the selected publicly traded companies are identical or directly comparable to the Company. This analysis indicated the following implied per share equity reference ranges for infoGROUP, as compared to the per share cash consideration:

 

 

Discounted Cash Flow Analysis.  Evercore performed a discounted cash flow analysis of infoGROUP in order to derive implied per share equity reference ranges for infoGROUP based on the implied present value of future cash flow to infoGROUP. In this analysis, Evercore calculated implied per share equity reference ranges for infoGROUP using the Management Projections and Financial Forecast based on the sum of the (i) implied present values, using discount rates ranging from 11.5% to 12.5% of infoGROUP projected unlevered free cash flows for calendar years 2010 through 2014 and (ii) implied present values, using discount rates ranging from 11.5% to 12.5% of the terminal value of infoGROUP future cash flows beyond calendar year 2014 based on an assumed perpetuity

growth rate ranging from 2.0% to 3.0%. These values were discounted to present value as of March 31, 2010. Evercore derived the ranges of discount rates and perpetuity growth rates based on its professional judgment and experience. This analysis indicated the following implied per share equity reference ranges for infoGROUP, as compared to the per share cash consideration:

 

 

Although the discounted cash flow analysis is a widely used valuation methodology, it necessarily relies on numerous assumptions, including earnings growth rates, terminal values and discount rates. As a result, it is not necessarily indicative of infoGROUP’s actual, present or future value or results, which may be significantly more or less favorable than suggested by this analysis.

 

Present Value of Implied Future Stock Price Analysis.  Evercore calculated illustrative future stock prices of infoGROUP on December 31, 2012 by applying a multiple range of 5.5x to 7.0x, based on a review of current and historical trading multiples of infoGROUP and companies identified above under the caption “Analysis of Select Publicly Traded Companies,” to estimated calendar year 2012 EBITDA of infoGROUP based on the Financial Forecast. These illustrative future stock prices were discounted to present value as of March 31, 2010 using a discount rate range of 14.0% to 15.0% that was derived by Evercore based on its professional judgment and experience. This analysis indicated the following implied per share equity reference ranges for infoGROUP, as compared to the per share cash consideration:

 

 

Selected Precedent M&A Transactions Analysis.  Evercore reviewed implied transaction data for 22 transactions involving target companies that Evercore deemed to have certain characteristics that are similar to those of infoGROUP. Evercore reviewed transaction values for the selected transactions, calculated as the TEV and also reviewed the multiple of TEV to LFQ revenue and EBITDA. Multiples for the selected transactions were based on publicly available information at the time of announcement of the relevant transaction. The transactions considered,

along with the respective TEV and multiples for each transaction, and the month and year each transaction was announced, were as follows:

 

 

 

 

 

Evercore then applied a range of selected multiples derived from those transactions described above for the selected companies of 6.5x to 7.5x of LFQ EBITDA as of March 31, 2010 to the LFQ Adjusted EBITDA of infoGROUP as of March 31, 2010, Evercore derived this range of selected multiples based on its professional judgment and experience, including its judgment based on the business characteristics of the target company, the date of the transaction, and other factors, including, but not limited to, and to the extent public information was available, historical financial performance, profitability, scale of business and strategic fit with the potential acquirer. Evercore noted that none of the selected transactions or the selected companies that participated in the selected transactions are directly comparable to the proposed Merger or the Company, respectively.

 

This analysis indicated the following implied per share equity reference ranges for infoGROUP, as compared to the per share cash consideration:

 

 

Leveraged Buyout Analysis.  Evercore performed a leveraged buyout (“LBO”) analysis of infoGROUP in order to ascertain the value of infoGROUP which might be attractive to a potential financial buyer based upon the Management Projections and Financial Forecast. Evercore assumed, among other things, the following in its LBO analysis: (i) capital structure scenarios for infoGROUP consistent with the anticipated terms of the proposed debt financing package in connection with the proposed Merger; which included $315 million of debt: (ii) a range of selected exit multiples of 5.5x to 7.5x calendar year 2014 EBITDA; and (iii) an equity investment that would achieve an internal rate of return during the investment period beginning March 31, 2010 of between 20.0% and 25.0%. Evercore derived these ranges of assumptions based on its professional judgment and experience, including its judgment regarding (x) the reasonableness of the anticipated terms of the proposed debt financing commitment in connection with the proposed Merger, (y) reasonable internal rates of return likely to be required by a financial sponsor in connection with the proposed Merger, and (z) current and historical trading multiples of infoGROUP and companies identified above under the caption “Analysis of Select Publicly Traded Companies,” as well as implied transaction data from those transactions identified above under the caption “Selected Precedent M&A Transactions Analysis.” This analysis indicated the following implied per share equity reference range for infoGROUP, as compared to the per share cash consideration:

 

 

General

 

In connection with the review of the proposed Merger by the infoGROUP board of directors, Evercore performed a variety of financial and comparative analyses for purposes of rendering its opinion. The preparation of a fairness opinion is a complex process and is not necessarily susceptible to partial analysis or summary description. Selecting portions of the analyses or of the summary described above, without considering the analyses as a whole, could create an incomplete view of the processes underlying Evercore’s opinion. In arriving at its fairness determination, Evercore considered the results of all the analyses and did not draw, in isolation, conclusions from or with regard to any one analysis or factor considered by it for purposes of its opinion. Rather, Evercore made its determination as to fairness on the basis of its experience and professional judgment after considering the results of all the analyses. In addition, Evercore may have considered various assumptions more or less probable than other assumptions, so that the range of valuations resulting from any particular analysis described above should therefore not be taken to be Evercore’s view of the value of infoGROUP. No company used in the above analyses as a comparison is directly comparable to infoGROUP, and no transaction used is directly comparable to the proposed Merger. Further, Evercore’s analyses involve complex considerations and judgments concerning financial and operating characteristics and other factors that could affect the acquisition, public trading or other values of the companies or transactions used, including judgments and assumptions with regard to industry performance, general business, economic, market and financial conditions and other matters, many of which are beyond the control of infoGROUP.

 

Evercore prepared these analyses solely for the purpose of providing an opinion to the infoGROUP board of directors as to the fairness, from a financial point of view, of the cash consideration to be received by the holders of shares of infoGROUP Common Stock entitled to receive such cash consideration. These analyses do not purport to be appraisals or to necessarily reflect the prices at which the business or securities actually may be sold. Any estimates contained in these analyses are not necessarily indicative of actual future results, which may be significantly more or less favorable than those suggested by such estimates. Accordingly, estimates used in, and the results derived from, Evercore’s analyses are inherently subject to substantial uncertainty, and Evercore assumes no responsibility if future results are materially different from those forecasted in such estimates. The cash consideration to be received by the holders of shares of infoGROUP Common Stock pursuant to the Merger Agreement was determined through arm’s-

length negotiations between infoGROUP and CCMP Capital Advisors, LLC and was approved by the infoGROUP board of directors. Evercore did not recommend any specific consideration to infoGROUP or that any given amount of consideration constituted the only appropriate consideration.

 

Under the terms of the Evercore’s engagement, infoGROUP paid Evercore $1,000,000 upon the delivery of Evercore’s opinion and has agreed to pay Evercore an aggregate fee of approximately $7.5 million upon completion of the Merger, against which the opinion fee will be credited. In addition, infoGROUP agreed to reimburse Evercore’s reasonable and customary expenses and to indemnify Evercore for certain liabilities arising out of its engagement. Prior to this engagement, Evercore and its affiliates provided financial advisory services to the Company and had received fees of approximately $2.1 million during the preceding two years (and may in the future receive additional fees) for the rendering of these services including the reimbursement of expenses. During the two year period prior to the date of Evercore’s opinion, no material relationship existed between Evercore and its affiliates and Acquisition Sub or Parent pursuant to which compensation was received by Evercore or its affiliates as a result of such relationship. Evercore may provide financial or other services to infoGROUP, Acquisition Sub or Parent, or any of their respective affiliates, in the future and in connection with any such services Evercore may receive compensation.

 

In the ordinary course of business, Evercore or its affiliates may actively trade the securities, or related derivative securities, or financial instruments of infoGROUP and its affiliates, for its own account and for the accounts of its customers and, accordingly, may at any time hold a long or short position in such securities or instruments.

 

infoGROUP engaged Evercore to act as a financial advisor based on its qualifications, experience and reputation. Evercore is an internationally recognized investment banking firm and is regularly engaged in the valuation of businesses in connection with mergers and acquisitions, leveraged buyouts, competitive biddings, private placements and valuations for corporate and other purposes. Evercore’s opinion was authorized by the opinion committee of Evercore.

 

The total amount of funds necessary to complete the Merger is anticipated to be approximately $658.7 million, consisting of (i) approximately $468.3 million to pay the Company’s stockholders, option holders, and holders of Company stock-based awards the amounts due to them under the Merger Agreement, assuming that no Company stockholder validly exercises and perfects its appraisal rights, (ii) approximately $165.6 million to refinance the Company’s outstanding indebtedness, and (iii) approximately $24.8 million to pay related fees and expenses in connection with the Merger, the financing arrangements and the transactions described in this paragraph.

 

These payments are expected to be funded by Parent and Acquisition Sub in a combination of equity contributions by CCMP in Parent, debt financing and to the extent available, cash of the Company. Parent and Acquisition Sub have obtained equity and debt financing commitments described below in connection with the transactions contemplated by the Merger Agreement.

 

Equity Financing

 

Pursuant to an equity commitment letter dated March 8, 2010 to Acquisition Sub, CCMP has agreed to cause up to $343.7 million of cash to be contributed to Parent, which will constitute the equity portion of the Merger financing. Subject to certain conditions, CCMP may assign a portion of its equity commitment obligation, provided that it remains obligated to perform to the extent not performed by such assignee. The commitment of each of the CCMP affiliated funds are as follows:

 

 

The equity commitment is subject to (i) the terms of the equity commitment letter; (ii) the satisfaction or waiver of all of the conditions to Parent’s and Acquisition Sub’s obligation to effect the closing of the Merger under the Merger Agreement in accordance with its terms; and (iii) the funding of the debt financing having occurred or being subject solely to the funding of the equity commitment at the closing. The Company is a third party

beneficiary of the equity commitment letter and is entitled to cause the commitment to be funded if all of the conditions precedent to the obligations of CCMP have been met. The equity commitment letter will terminate upon the termination of the Merger Agreement or if the Company or any of its affiliates asserts, in any legal proceeding, any claim under the limited guarantee.

 

Debt Financing

 

Parent has received a debt commitment letter, dated as of March 8, 2010, from BofA to provide, subject to the conditions set forth therein, to Acquisition Sub, up to $365.0 million in senior secured credit facilities (the “Senior Credit Facilities”), comprised of (i) a term loan facility of $315.0 million and (ii) a revolving credit facility of up to $50.0 million. The proceeds of the borrowings under the term loan facility shall be used for the purpose of financing the Merger, repaying or refinancing certain existing indebtedness of the Company and its subsidiaries and paying costs and expenses incurred in connection with the Merger. After closing, the proceeds of the borrowings of the revolving credit facility may be used to provide ongoing working capital and for other general corporate purposes of the Surviving Corporation and its subsidiaries.

 

The borrower under the Senior Credit Facilities will be Acquisition Sub initially, and the Surviving Corporation, upon initial funding of the Senior Credit Facility. The debt commitments expire on the earliest of (a) July 21, 2010 unless the consummation of the Merger occurs prior thereto, (b) the closing of the transactions contemplated by the Merger Agreement without the use of the Senior Credit Facilities, and (c) the termination of the Merger Agreement.

 

If any portion of the debt financing becomes unavailable on the terms and conditions contemplated in the debt commitment letter or the debt commitment letter shall be terminated or modified in a manner materially adverse to Parent or Acquisition Sub for any reason, Parent may arrange to obtain alternative financing from alternative sources terms not materially less favorable to Parent or Acquisition Sub as those contained in the debt commitment letter, in an amount sufficient to consummate the Merger.

 

Conditions Precedent to the Debt Commitments

 

The availability of the Senior Credit Facilities are subject, among other things, to the negotiation, execution and delivery of definitive documentation with respect to the Senior Credit Facilities, the payment of all costs, fees and expenses payable on the date of the initial funding of the Senior Credit Facility, and the satisfaction of certain conditions precedent to closing, including:

 

 

 

 

As of December 31, 2009, the Company’s consolidated debt to EBITDA ratio, after giving pro forma effect to the Merger, was 3.4:1.0.

 

Limited Guarantee

 

In connection with the Merger Agreement, CCMP and the Company entered into a limited guarantee pursuant to which, among other things, CCMP has agreed to guarantee the performance and discharge of certain obligations of Parent and Acquisition Sub under the Merger Agreement; however, the maximum aggregate liability of CCMP shall not exceed $27,356,000 (which is equal to the termination fee payable by Parent to the Company under certain circumstances pursuant to the Merger Agreement plus up to $2,000,000 of the Company’s out-of-pocket expenses) (the “Merger Agreement Obligations”).

 

The limited guarantee will remain in full force and effect until all of the Merger Agreement Obligations have been indefeasibly paid in full. Notwithstanding the foregoing, the limited guarantee will terminate as of the earlier of (i) the effective time of the Merger; (ii) the first anniversary of the termination of the Merger Agreement in accordance with its terms, except as to a claim for payment of any Merger Agreement Obligations presented by the Company to Parent, Acquisition Sub or CCMP by such first anniversary; and (iii) the termination of the Merger Agreement in accordance with its terms under circumstances set forth in the Merger Agreement in which Parent and Acquisition Sub would not be obligated to pay the Merger Agreement Obligations.

 

Simultaneously with the execution of the Merger Agreement and as a condition and inducement to Parent’s entering into the Merger Agreement, Parent and the Company also entered into voting agreements with its then current directors and executive officers of the Company. Pursuant to the voting agreements, the stockholders agreed, among other things, to vote all of the shares of Common Stock beneficially owned by such stockholders in favor of the adoption of the Merger Agreement at any meeting of the Company’s stockholders. As of the record date, these stockholders collectively exercised voting control over approximately [  ]% of the outstanding shares of Common Stock. Any additional shares of Common Stock acquired by the stockholders following the stockholders’ entry into the voting agreements will automatically become subject to the voting agreements.

 

The voting agreements require the stockholders, among other things, to vote their shares of Common Stock at any meeting of the Company’s stockholders:

 

 

In addition, the stockholders granted Parent an irrevocable proxy to vote the stockholders’ shares of Common Stock on their behalf in the event the stockholders fail to act in accordance with the voting agreements. Under the

voting agreements, the stockholders (other than Mr. Vinod Gupta) have also agreed not to sell, transfer, exchange, pledge or otherwise encumber, assign or dispose of their shares of Common Stock without the prior consent of Parent, enter into any other voting arrangement or grant any other proxy with respect to such shares, or take any other action in contravention of the voting agreement. The voting agreements terminate on the earlier of the completion of the Merger or the termination of the Merger Agreement. The full text of the form of voting agreement is attached to this proxy statement as Annex D.

 

Mr. Gupta’s voting agreement contains additional provisions to those set forth in the form of the voting agreement which exempt certain of his shares of Common Stock from the restriction on transfer. Mr. Gupta is permitted to sell up to 1.5 million shares of Common Stock in the aggregate (inclusive of any sales under existing 10b5-1 trading plans) so long as any such sale is in compliance with applicable securities laws. Additionally, the transfer restrictions do not apply to any of his shares delivered into escrow and the subsequent distribution, sale or disposition of the shares, if in compliance with applicable securities laws, to satisfy his obligation under a settlement agreement with the SEC.

 

In considering the recommendation of the board of directors to vote “FOR” the proposal to adopt the Merger Agreement, you should be aware that certain of infoGROUP’s directors and executive officers have interests in the transaction that are different from, or in addition to, the interests of infoGROUP’s stockholders generally. These interests may present them with actual or potential conflicts of interest, and these interests, to the extent material, are described below. The M&A Committee and the board of directors were aware of these potential conflicts of interest and considered them, among other matters, in reaching their decisions to approve the Merger Agreement and the Merger and the recommendation that stockholders vote “FOR” adopting the Merger Agreement.

 

Vinod Gupta

 

The Final Judgment in the SEC’s case against Mr. Gupta contained sanctions and fines pursuant to which Mr. Gupta is:

 

(1) prohibited from future violations of multiple provisions of federal securities laws;

 

(2) barred for life from serving as an officer or director of a public company;

 

(3) required to vote his shares of Common Stock in the same proportion as other shareholders vote on the same issue, but there is an exception to this requirement for the shareholder vote on the proposed Merger which allows Mr. Gupta to vote all his shares in favor of adoption of the merger agreement, and another exception which allows him to vote against any competing acquisition proposal if Mr. Gupta would receive an amount or form of consideration in any such transaction less than or different from other Company shareholders generally;

 

(4) required to pay a civil penalty to the United States Treasury in the amount of $2,240,700 (plus post-judgment interest); and

 

(5) required to pay the Company $4,045,000, prejudgment interest of $1,145,400, for a total of $5,190,400 (plus post-judgment interest).

 

In connection with the 2008 shareholder derivative action involving the Company, Mr. Gupta resigned as Chairman of the Board of Directors in July 2008 and as the Company’s Chief Executive Officer in August 2008. At the time the Board of Directors approved the merger agreement, Mr. Gupta had already been paid all severance benefits owing to him under the related Separation Agreement and General Release between him and the Company dated August 20, 2008. Mr. Gupta had also already paid the Company $4.4 million of the $9 million owing to the Company under the Stipulation of Settlement for the derivative action which became final on November 7, 2008.

 

The Merger provides all of the Company’s stockholders with a certain cash value for their shares, while avoiding long-term business risk. Mr. Gupta could be viewed to benefit from the Merger because it provides him with liquidity for his significant shareholdings, which he could in turn use to pay the amounts required by the Final Judgment and the remaining amounts under the Stipulation of Settlement.

Treatment of Stock Options

 

As of the record date, there were approximately • shares of Common Stock granted under our equity incentive plans to our current executive officers and directors. Under the terms of the Merger Agreement, upon the consummation of the Merger (i) all outstanding options to acquire Common Stock will become fully vested and (ii) all such options not exercised prior to the Merger will be cancelled and converted into the right to receive a cash payment equal to the number of shares of Common Stock underlying the options multiplied by the amount (if any) by which $8.00 exceeds the exercise price, without interest and less any applicable withholding taxes, with the aggregate amount of such payment rounded to the nearest whole cent.

 

None of our current directors and executive officers hold options to acquire shares of Common Stock. The following table identifies, for Mr. Gupta, the aggregate number of shares of Common Stock subject to outstanding vested and unvested options as of March 8, 2010, the aggregate number of shares of Common Stock subject to outstanding unvested options that will become fully vested in connection with the Merger, the weighted average exercise price and the value of such unvested options, and the weighted average exercise price and value of such collective vested and unvested options. None of Mr. Gupta’s options have an exercise price below $8.00 per share. The information in the table assumes that all options included therein remain outstanding on the closing date of the Merger.

 

 

 

 

Treatment of Company Stock-Based Awards

 

As of the record date, there were approximately • Company stock-based awards granted under our stock plans or employee plans to Mr. Gupta and our current executive officers and directors (described more fully below under The Merger Agreement — Treatment of Options and Other Awards — Company Stock-Based Awards). Under the terms of the Merger Agreement, each Company stock-based award held by an executive officer or director that is outstanding as of the effective time of the Merger will become fully vested and transferable, and will be cancelled and converted into the right to receive a cash payment equal to the aggregate number of shares or fractional shares of Common Stock represented by such Company stock-based award multiplied by $8.00, without interest and less any applicable withholding taxes, with the aggregate amount of such payment rounded to the nearest whole cent.

 

The following table identifies, for Mr. Gupta and each of our directors and executive officers, the aggregate number of shares of Common Stock subject to such outstanding Company stock-based awards as of March 8, 2010 and the value of such Company stock-based awards that will become fully vested in connection with the Merger. The information in the table assumes that all such Company stock-based awards remain outstanding on the closing date of the Merger.

 

 

 

 

New Employment Arrangements

 

As of the date of this proxy statement, none of our executive officers has entered into any amendments or modifications to existing employment agreements with us or our subsidiaries in anticipation of the Merger, nor has any executive officer who has plans or is expected to remain with the Surviving Corporation entered into any agreement, arrangement or understanding with CCMP or their affiliates regarding employment with, or the right to purchase or participate in the equity of, the Surviving Corporation. Although no such agreement, arrangement or understanding currently exists, it is generally expected that a number of our executive officers will remain employed after the Merger is completed, which means that such executive officers may, prior to the closing of the Merger, enter into new arrangements with CCMP or their affiliates regarding employment with, or the right to purchase or participate in the equity of, the Surviving Corporation.

 

Change of Control Severance Agreements / Employee Agreements

 

The Company has entered into severance or employment agreements with the following executive officers that make certain payments or provide certain benefits to such executive officers in the event of a termination of employment in connection with a change of control, except in the case of Mr. Fairfield who will receive a payment in connection with a change of control regardless of whether he has a termination of employment. In addition to change of control benefits each severance agreement generally provides for continuation of health insurance coverage for one year and vesting of all equity awards. In addition, the severance agreements of Messrs. Fairfield, Oberdorf, and McCusker allow any performance based compensation that is conditioned upon performance-based long term incentives to be earned based on actual performance at the date of termination. The executive severance agreements provide for change of control payments as follows.

 

Bill L. Fairfield, CEO.  If a change of control occurs, Mr. Fairfield will receive one half of his then annual salary plus one-half of his targeted annual cash incentive (which is 100% of his annual salary). Pursuant to Mr. Fairfield’s employment agreement, if Mr. Fairfield’s employment is terminated without cause (as defined in the employment agreement) by the Company or for “good reason” (as defined in the employment agreement) by Mr. Fairfield in anticipation of or on or after a change of control, he will receive a lump sum cash payment equal to two times his then annual salary plus two times his targeted annual cash incentive (which is 100% of his annual salary) for the year of termination, less any amount paid to Mr. Fairfield as described in the foregoing sentence.

Also, pursuant to his severance agreement, he will receive a partial year bonus which is an amount equal to his targeted annual cash incentive compensation for the year of termination (assuming that performance goals for receiving such bonus have been achieved) times the fraction of the days that he was employed in the year of termination over the total number of days in the year of termination. To receive any change of control severance benefits, Mr. Fairfield must execute a general release of all claims against the Company. He must also refrain from competing with the Company and from soliciting the Company’s employees for a period of one (1) year following the date of termination.

 

Thomas Oberdorf, CFO.  Pursuant to Mr. Oberdorf’s employment agreement, if Mr. Oberdorf’s employment is terminated without cause (as defined in the employment agreement) by the Company or for “good reason” (as defined in the employment agreement) by Mr. Oberdorf in anticipation of or on or within two (2) years after a change of control, the Company will pay to Mr. Oberdorf a lump sum cash payment equal to (x) his then annual salary plus (y) the average of the two highest annual cash incentive payments Mr. Oberdorf has received in the preceding three (3) years or, if greater, the targeted annual cash incentive for the year of termination, together with additional payments to compensate for certain federal excise taxes (the “Oberdorf Base Severance Amount”), within thirty (30) days of termination. The Company will also pay another lump sum equal to the Oberdorf Base Severance Amount one year after such termination, less any then current annual compensation from Mr. Oberdorf’s gainful employment after such termination. Also, pursuant to his severance agreement, he will receive a partial year bonus which is an amount equal to his targeted annual cash incentive compensation for the year of termination (assuming that performance goals for receiving such bonus have been achieved) times the fraction of the days that he was employed in the year of termination over the total number of days in the year of termination. To receive any change of control severance benefits, Mr. Oberdorf must execute a general release of all claims against the Company. He must also refrain from competing with the Company and from soliciting the Company’s employees for a period of one (1) year following the date of termination.

 

Edward C. Mallin, President, infoUSA Services Group.  Pursuant to Mr. Mallin’s severance agreement, if Mr. Mallin’s employment is terminated within twelve (12) months after a change of control, and the reason for termination is either (i) by the Company other than for “cause” (as defined in the severance agreement), or (ii) by the executive for “good reason” (as defined in the severance agreement), the Company will pay Mr. Mallin a lump sum from one time up to three times of his total compensation (defined as the executive’s base salary in effect at the time of termination, plus the average of the lesser of executive’s annual bonus amount for the lesser of three (3) calendar years preceding the year in which Mr. Mallin’s employment terminates or all full calendar years of his employment with the Company), depending on the length of service completed by the executive, together with additional payments sufficient to compensate for certain federal excise taxes under Section 4999 of the Internal Revenue Code as a result of the application of the so-called “golden parachute” rules. To receive any change of control severance benefits, Mr. Mallin must execute a general release of all claims against the Company. He must also refrain from competing with the Company and from soliciting the Company’s employees for a period of two (2) years following the date of termination.

 

Thomas J. McCusker, General Counsel.  Pursuant to Mr. McCusker’s employment agreement, if Mr. McCusker’s employment is terminated without “cause” (as defined in the employment agreement) by the Company or for “good reason” (as defined in the employment agreement) by Mr. McCusker in anticipation of or on or within two (2) years after a change of control, the Company will pay to Mr. McCusker a lump sum equal to (x) his then annual salary plus (y) the average of the two highest annual cash incentive payments Mr. McCusker has received in the preceding three (3) years or, if greater, the targeted annual cash incentive for the year of termination, together with additional payments to compensate for certain federal excise taxes (the “McCusker Base Severance Amount”), within thirty (30) days of termination. The Company will also pay another lump sum equal to the McCusker Base Severance Amount one year after such termination, less any then current annual compensation from Mr. McCusker’s gainful employment after such termination. Also, pursuant to his severance agreement, he will receive a partial year bonus which is an amount equal to his targeted annual cash incentive compensation for the year of termination (assuming that performance goals for receiving such bonus have been achieved) times the fraction of the days that he was employed in the year of termination over the total number of days in the year of termination. To receive any change of control severance benefits, Mr. McCusker must execute a general release of

all claims against the Company. He must also refrain from competing with the Company and from soliciting the Company’s employees for a period of one (1) year following the date of termination.

 

Assuming that the change of control provisions in each of the executive officer’s severance agreements are triggered by the Merger, and immediately following the Merger the executive’s employment is terminated without cause by the Company or with good reason by the executive, the amount of cash severance benefits based on each executive officer’s severance agreement is:

 

 

In addition to the cash payments due upon termination after the Merger, the following executives might also be entitled to partial year bonus payments under any termination without cause or departure for good reason. Assuming that the executive’s performance goals had been met in the year of termination and that the executive was employed for the first six months in that year, the amount of cash partial year bonus payable to each applicable executive officer under his respective employment agreement is:

 

 

If the total amount of payments or benefits payable in connection with a change of control (the “total payments”) results in receipt of excess parachute payments, as described in Section 280G of the Internal Revenue Code, to Messrs. Fairfield, Oberdorf, Mallin or McCusker, then the executive is entitled under his severance agreement to an additional amount (a “gross-up payment”) to offset any excise tax imposed upon him under Section 4999 of the Internal Revenue Code. The severance agreements reduce the total payments by up to 10% if the reduction would avoid the need for a gross-up payment. The gross-up payments for the executives, assuming the change of control provisions in each of their severance agreements are triggered by the Merger, and immediately following the Merger the executive’s employment is terminated without cause by the Company or with good reason by the executive, are estimated to be as follows:

 

 

No gross-up payments are estimated due to Messrs. Oberdorf and Mallin.

 

Indemnification and Insurance

 

The Surviving Corporation has agreed to indemnify (and to comply with all of our obligations to advance funds for expenses), during the period commencing at the effective time of the Merger and ending on the sixth anniversary of the effective time, to the greatest extent permitted by law, each of the Company’s and our subsidiaries’ present and former officers and directors against all costs, fees, and expenses (including reasonable attorneys’ fees and investigation expenses), judgments, fines, losses, claims, damages, liabilities and amounts paid in settlement in connection with any claim, proceeding, investigation or inquiry that arises out of or pertains to (i) any act or omission in their capacity as an officer, director, employee or agent of the Company, or any of its subsidiaries, or other affiliates that satisfies the provisions of Section 145 of the DGCL, or (ii) any transaction contemplated by the Merger Agreement. If at any time prior to the sixth anniversary of the effective time, any indemnified person

delivers to Parent a written notice asserting a claim for indemnification, the claim asserted in such notice shall survive the sixth anniversary of the effective time until such time that the claim is fully resolved.

 

During the period commencing at the effective time and ending on the sixth anniversary of the effective time, the Surviving Corporation shall (and Parent shall cause the Surviving Corporation to) maintain in effect the Company’s current directors’ and officers’ liability insurance in respect of acts or omissions occurring at or prior to the effective time, covering each person covered by the Company’s current directors’ and officers’ liability insurance. Pursuant to the Merger Agreement, the Company may elect to purchase a prepaid six-year “tail coverage” directors’ and officers’ liability insurance policy. In the event that the Company purchases such a policy, the Surviving Corporation shall (and Parent shall cause the Surviving Corporation to) maintain such “tail” policy in full force and effect and continue to honor the Company’s obligations thereunder.

 

Continued Benefits

 

To the extent that any of our executive officers remain employed by the Surviving Corporation, they will be entitled to receive compensation and benefits following the Merger. For a period of one year following the effective time of the Merger, the Surviving Corporation shall:

 

 

All of the Company’s executive officers are entitled to participate in the Company’s benefit plans, which include tax-qualified 401(k), medical, dental and vision coverage and wellness programs, use of our employee assistance program, short and long-term disability, and paid time off in accordance with Company policies.

 

The following is a summary of the material U.S. federal income tax consequences of the Merger to a U.S. holder (as defined below) whose shares of Common Stock are converted into the right to receive cash in the Merger. This summary does not purport to consider all aspects of U.S. federal income taxation that might be relevant to a U.S. holder.

 

For purposes of this discussion, we use the term “U.S. holder” to mean a beneficial owner of shares of Common Stock that is, for U.S. federal income tax purposes (a) an individual who is a citizen or resident of the United States, (b) a corporation created or organized under the laws of the United States, any state thereof or the District of Columbia, (c) a trust that (i) is subject to the supervision of a court within the applicable U.S. Treasury regulations to be treated as a U.S. person, or (d) an estate that is subject to U.S. federal income tax on its income regardless of its source.

 

This discussion is based on current law, which is subject to change, possibly with retroactive effect. It applies only to beneficial owners that hold shares of Common Stock as capital assets, and does not address the U.S. federal income tax consequences of stockholders subject to special rules, such as stockholders who received shares of Common Stock in connection with the exercise of employee stock options or otherwise as compensation, stockholders that validly exercise their appraisal rights under Delaware law, insurance companies, banks, tax-exempt organizations, financial institutions, broker-dealers, partnerships, or other pass-through entities (and persons that hold shares of Common Stock through a partnership or other pass-through entity), mutual funds, traders in securities that elect the mark-to-market method of accounting, tax deferred or other retirement accounts, stockholders subject to the alternative minimum tax, U.S. holders that have a functional currency other than the U.S. dollar, certain former citizens or residents of the United States, stockholders who hold Common Stock as part of a hedge, straddle, integration, or a constructive sale or conversion transaction or persons that are not U.S. holders.

This discussion also does not address the receipt of cash in connection with the cancellation of Company Stock-Based Awards or options to purchase shares of Common Stock, or any other matters relating to equity compensation or benefit plans. This discussion also does not address any aspect of state, local or foreign tax laws or federal laws other than U.S. federal income tax laws.

 

If a partnership (including an entity treated as a partnership for U.S. federal income tax purposes) holds Common Stock, the tax treatment of a partner generally will depend on the status of the partners and the activities of the partnership. A partner of a partnership holding Common Stock should consult its tax advisor.

 

Exchange of Shares of Common Stock for Cash Pursuant to the Merger Agreement.  The exchange of shares of Common Stock for cash in the Merger will be a taxable transaction for U.S. federal income tax purposes. In general, a U.S. holder of shares of Common Stock will recognize capital gain or loss for U.S. federal income tax purposes equal to the difference between the amount of cash received in exchange for such shares and the U.S. holder’s adjusted tax basis in such shares. If a U.S. holder acquired different blocks of shares of Common Stock at different times or different prices, gain or loss must be determined separately for each block of shares. Such gain or loss will be long-term capital gain or loss provided that a stockholder’s holding period for such shares is more than 12 months. Long-term capital gains of non-corporate U.S holders are currently eligible for reduced rates of taxation. There are limitations on the deductibility of capital losses.

 

Backup Withholding and Information Reporting.  Backup withholding of tax may apply to cash payments to which a non-corporate U.S. holder is entitled under the Merger Agreement, unless the U.S. holder or other payee provides a taxpayer identification number, certifies that such number is correct, and otherwise complies with the backup withholding rules. Unless an exemption applies and is established in a manner satisfactory to the paying agent, each of our U.S. holders should complete and sign the Substitute Form W-9 included as part of the letter of transmittal and return it to the paying agent, in order to provide the information and certification necessary to avoid backup withholding. Cash payments made pursuant to the Merger generally also will be subject to information reporting unless an exemption applies.

 

Backup withholding is not an additional tax. Any amounts withheld under the backup withholding rules will be allowable as a refund or a credit against a U.S. holder’s U.S. federal income tax liability provided the required information is timely furnished to the Internal Revenue Service.

 

The U.S. federal income tax consequences described above are not intended to constitute a complete description of all tax consequences relating to the Merger. Each stockholder should consult it’s tax advisor regarding the particular tax consequences of the Merger in light of such stockholder’s particular circumstances, the application of U.S. federal, state, local and non-U.S. tax laws, and, if applicable, the tax consequences of the receipt of cash in connection with options or Company Stock-Based Awards, including the transactions described in this proxy statement relating to our other equity compensation and benefit plans.

 

Under the HSR Act and the rules promulgated thereunder by the FTC, the Merger cannot be completed until infoGROUP and Parent file a notification and report form under the HSR Act and the applicable waiting period has expired or been terminated. infoGROUP and Parent filed notification and report forms under the HSR Act with the FTC and the Antitrust Division of the DOJ on March 22, 2010 and March 24, 2010, respectively; however, the applicable waiting period has not yet expired or been terminated. At any time before or after consummation of the Merger, notwithstanding the early termination of the waiting period under the HSR Act, the Antitrust Division of the DOJ or the FTC could take such action under the antitrust laws as it deems necessary or desirable in the public interest, including seeking to enjoin the consummation of the Merger or seeking divestiture of substantial assets of infoGROUP or Parent. At any time before or after the consummation of the Merger, and notwithstanding the early termination of the waiting period under the HSR Act, any state could take such action under the antitrust laws as it deems necessary or desirable in the public interest. Such action could include seeking to enjoin the consummation of the Merger or seeking divestiture of substantial assets of infoGROUP or Parent. Private parties may also seek to take legal action under the antitrust laws under certain circumstances.

While there can be no assurance that the Merger will not be challenged by a governmental authority or private party on antitrust grounds, infoGROUP, based on a review of information provided by Parent relating to the businesses in which it and its affiliates are engaged, believes that the Merger can be effected in compliance with federal, state and any applicable foreign antitrust laws. The term “antitrust laws” means the Sherman Act, as amended, the Clayton Act, as amended, the HSR Act, the Federal Trade Commission Act, as amended, and all other Federal, state and foreign statutes, rules, regulations, orders, decrees, administrative and judicial doctrines, and other laws that are designed or intended to prohibit, restrict or regulate actions having the purpose or effect of monopolization or restraint of trade.

 

Beginning on or around March 9, 2010, three putative class action lawsuits were filed in the District Court of Douglas County, State of Nebraska: The Pennsylvania Avenue Funds v. InfoGROUP Inc., et al., Doc. 1104 No. 822 (filed on or around March 9, 2010); Gary Sappenfield v. Infogroup Inc., et al., Doc. 1105 No. 146 (filed on or around March 16, 2010); Ronald E. Kistner v. Infogroup Inc. et al., Doc. 1105 No. 189 (filed on or around March 17, 2010). In each of these lawsuits, the plaintiff alleges that it is a shareholder of the Company and purports to bring the lawsuit as a class action on behalf of itself and all other shareholders of the Company. Each lawsuit names as defendants the Company, Vinod Gupta, Bill L. Fairfield, Roger S. Siboni, George H. Krauss, Gary E. Morin, Bernard W. Reznicek, Lee D. Roberts, John N. Staples III, Thomas L. Thomas, Clifton T. Weatherford, and CCMP Capital Advisors, LLC. The complaint in each of the lawsuits alleges, among other things, that the individual defendants breached their fiduciary duties by attempting to complete the sale of the Company to CCMP Capital Advisors, LLC through an unfair process and at an unfair price, and that the Company and CCMP Capital Advisors, LLC aided and abetted the alleged breaches of fiduciary duty. Among other relief, the lawsuits seek to enjoin the proposed sale, and seek recovery of the costs of the action, including reasonable attorneys’ fees.

 

On or around March 11, 2010, a lawsuit titled New Jersey Carpenters Pension Fund v. InfoGROUP, Inc., et al., Case No. 5334, was filed in the Court of Chancery of the State of Delaware, naming as defendants the Company, Vinod Gupta, Bill L. Fairfield, Roger S. Siboni, George H. Krauss, Gary E. Morin, Bernard W. Reznicek, Lee D. Roberts, John N. Staples III, Thomas L. Thomas, Clifton T. Weatherford, CCMP Capital Advisors, LLC, Omaha Holdco Inc. and Omaha Acquisition Inc. The plaintiff alleges that it is a shareholder of the Company and purports to bring this lawsuit as a class action on behalf of itself and all other shareholders of the Company. The complaint alleges, among other things, that the individual defendants breached their fiduciary duties by attempting to complete the sale of the Company to CCMP Capital Advisors, LLC through an unfair process and at an unfair price, and that CCMP Capital Advisors, LLC, Omaha Holdco Inc. and Omaha Acquisition Inc. aided and abetted the alleged breaches of fiduciary duty. Among other relief, the lawsuit seeks to enjoin the proposed sale, and seeks compensatory damages of an undetermined amount and recovery of the costs of the action, including reasonable attorneys’ fees.

 

The Company believes the complaints are without merit, and intends to defend the actions vigorously.

 

If the Merger is completed, the Common Stock will be delisted from NASDAQ and deregistered under the Exchange Act and we will no longer file periodic reports with the SEC on account of the Common Stock.

 

This section of the proxy statement describes the material provisions of the Merger Agreement but does not purport to describe all of the terms of the Merger Agreement. The following summary is qualified in its entirety by reference to the complete text of the Merger Agreement, which is attached as Annex A to this proxy statement and incorporated into this proxy statement by reference. We urge you to read the full text of the Merger Agreement because it is the legal document that governs the Merger. It is not intended to provide you with any other factual information about us. Such information can be found elsewhere in this proxy statement and in the public filings we make with the SEC, as described in the section entitled “Where You Can Find More Information” below.

 

The Merger Agreement provides for the Merger of Acquisition Sub with and into infoGROUP upon the terms, and subject to the conditions, of the Merger Agreement. As the Surviving Corporation, infoGROUP will continue to exist following the Merger. Upon consummation of the Merger, the directors of Acquisition Sub will be the initial directors of the Surviving Corporation and the officers of infoGROUP will be the initial officers of the Surviving Corporation. All Surviving Corporation officers will hold their positions until their successors are duly elected and qualified.

 

The Company, Parent or Acquisition Sub may terminate the Merger Agreement prior to the consummation of the Merger in some circumstances, whether before or after the adoption by our stockholders of the Merger Agreement. Additional details on termination of the Merger Agreement are described in “Termination of the Merger Agreement” beginning on page 66.

 

The Merger will be effective at the time the certificate of merger is filed with the Secretary of State of the State of Delaware (or at a later time, if agreed in writing by the parties and specified in the certificate of merger). The parties are required to close the Merger no later than the third (3^rd) business day after the satisfaction or waiver of the last of the conditions described under “The Merger Agreement — Conditions to the Merger” beginning on page 63, or on such other date as the parties may agree in writing.

 

Each share of Common Stock issued and outstanding immediately prior to the effective time of the Merger will be converted into the right to receive $8.00 in cash, without interest and less any applicable withholding taxes, other than the following shares:

 

 

After the Merger is effective, each holder of a certificate representing any shares of Common Stock (other than shares for which appraisal rights have been properly demanded and perfected) will no longer have any rights with respect to the shares, except for the right to receive the merger consideration. See “Dissenters’ Rights of Appraisal” beginning on page 75.

 

Stock Options.  Upon the consummation of the Merger (i) all outstanding options to acquire Common Stock will become fully vested and (ii) all such options not exercised prior to the Merger will be cancelled and converted into the right to receive a cash payment equal to the number of shares of Common Stock underlying the options multiplied by the amount (if any) by which $8.00 exceeds the exercise price, without interest and less any applicable withholding taxes, with the aggregate amount of such payment rounded to the nearest whole cent.

 

Company Stock-Based Awards.  Upon the consummation of the Merger each right of any kind, contingent or accrued, to receive shares of Common Stock or benefits measured in whole or in part by the value of a number of

shares of Company Common Stock granted under the Company stock plans or employee plans (including performance shares, restricted stock, restricted stock units, phantom units, deferred stock units and dividend equivalents, but not including any 401(k) plan of the Company), other than Company options (each a “Company Stock-Based Award”), will (i) become fully vested and transferable, and (ii) each such Company Stock-Based Award that remains outstanding immediately prior to the consummation of the Merger will be cancelled and converted into the right to receive a cash payment equal to the aggregate number of shares or fractional shares of Common Stock represented by such Company Stock-Based Award multiplied by $8.00, without interest and less any applicable withholding taxes, with the aggregate amount of such payment rounded to the nearest whole cent.

 

Employee Stock Purchase Plan.  Prior to the effective time of the Merger, the Company will terminate the Company Employee Stock Purchase Plan in accordance with its terms. The Company has also amended the plan to avoid the commencement of any new offering to purchase Common Stock thereunder.

 

The effect of the Merger on our other employee benefit plans is described under “— Employee Benefits” beginning on page 70.

 

Parent will designate a paying agent reasonably acceptable to the Company to make payment of the merger consideration described above. Promptly after the effective time of the Merger, Parent will deposit, or Parent will cause to be deposited, in trust with the paying agent the funds appropriate to pay the merger consideration to the stockholders, holders of options, and holders of Company Stock-Based Awards.

 

Following the effective time of the Merger, the Company will close its stock ledger. After that time, there will be no further transfer of shares of Common Stock.

 

Promptly after the effective time of the Merger, the Surviving Corporation will cause the paying agent to send you a letter of transmittal and/or instructions advising you how to surrender your certificates in exchange for the merger consideration. The paying agent will pay you your merger consideration after you have (i) surrendered your certificates to the paying agent and (ii) provided to the paying agent your signed letter of transmittal and any other items specified by the letter of transmittal. Interest will not be paid or accrue in respect of the merger consideration. The Surviving Corporation will reduce the amount of any merger consideration paid to you by any applicable withholding taxes. YOU SHOULD NOT FORWARD YOUR STOCK CERTIFICATES TO THE PAYING AGENT WITHOUT A LETTER OF TRANSMITTAL, AND YOU SHOULD NOT RETURN YOUR STOCK CERTIFICATES WITH THE ENCLOSED PROXY.

 

Any portion of cash deposited with the paying agent by Parent that is not claimed within twelve (12) months following the effective time of the Merger, will be returned to Parent upon demand. Thereafter, any holders of shares of Common Stock who have not surrendered their shares will look solely to the Surviving Corporation for payment of their claim for the merger consideration.

 

If the paying agent is to pay some or all of your merger consideration to a person other than you, as the registered owner of a stock certificate, you must have your certificates properly endorsed or otherwise in proper form for surrender and transfer, and you must pay any transfer or other taxes payable by reason of the transfer or establish to the paying agent’s reasonable satisfaction that the taxes have been paid or are not required to be paid.

 

The transmittal instructions will tell you what to do if you have lost your certificate, or if it has been stolen or destroyed. You will have to provide an affidavit to that fact and, if required by the paying agent or reasonably requested by the Surviving Corporation, post a bond in an amount that the Surviving Corporation directs as indemnity against any claim that may be made against the Surviving Corporation in respect of the lost, stolen or destroyed certificate.

 

The Merger Agreement contains representations and warranties made by the Company to Parent and Acquisition Sub and representations and warranties made by Parent and Acquisition Sub to the Company. The assertions embodied in those representations and warranties were made solely for purposes of the Merger

Agreement and may be subject to important qualifications and limitations agreed by the parties in connection with negotiating its terms. Moreover, some of those representations and warranties may not be accurate or complete as of any particular date because they are subject to a contractual standard of materiality or Company Material Adverse Effect (described below) different from that generally applicable to public disclosures to stockholders or used for the purpose of allocating risk between the parties to the Merger Agreement rather than establishing matters of fact. For the foregoing reasons, you should not rely on the representations and warranties contained in the Merger Agreement as statements of factual information.

 

In the Merger Agreement, the Company, Parent and Acquisition Sub each made representations and warranties relating to, among other things:

 

 

In the Merger Agreement, Parent and Acquisition Sub also each made representations and warranties relating to:

 

 

The Company also made representations and warranties relating to:

 

 

 

Many of the Company’s representations and warranties are qualified by a Company Material Adverse Effect standard. For purposes of the Merger Agreement, “Company Material Adverse Effect” is defined to mean any change, effect, event, circumstance or development (each a “Change”, and collectively, “Changes”), individually or in the aggregate, and taken together with all other Changes, that is materially adverse to the business, operations, financial condition or results of operations of the Company and its subsidiaries, taken as a whole, other than any Change (individually or when aggregated or taken together with any and all other Changes) directly or indirectly resulting from, relating to or arising out of any of the following:

 

 

 

 

 

except to the extent such effects directly or indirectly resulting from, arising out of, attributable to or related to the matters described in the first five bullets above disproportionately affect in a material respect the Company and its subsidiaries, taken as a whole, as compared to other companies that conduct business in the countries and regions in the world and in the industries in which the Company and its subsidiaries conduct business.

 

We have agreed in the Merger Agreement that, until the consummation of the Merger, except as contemplated by the Merger Agreement or approved by Parent (which approval shall not be unreasonably withheld) we will and will cause our subsidiaries to:

 

 

We have also agreed that, until the consummation of the Merger, except as expressly contemplated by the Merger Agreement or approved by Parent (which approval will not be unreasonably withheld), we and our subsidiaries will not:

 

 

 

 

 

 

 

 

 

 

Subject to the terms and conditions set forth in the Merger Agreement, each of the parties to the Merger Agreement has agreed to use its reasonable best efforts to take, or cause to be taken, all actions, and to do or cause to be done, and to assist and cooperate with the other parties to the Merger Agreement in doing, all things reasonably necessary, proper or advisable under applicable law to consummate the Merger in the most expeditious manner reasonably practicable, including:

 

 

For purposes of the Merger Agreement “reasonable best efforts”, or any similar undertakings, shall not require Parent to (x) fund more than the $315.0 million of debt financing at closing, (y) pay (or agree to pay) more for the debt financing (whether in interest rate, fees or otherwise) than the terms set forth in the debt commitment letter and any fee letter entered into by Parent and/or Acquisition Sub in connection with such debt commitment letter (including giving effect to any increase in interest rate, fees or otherwise resulting from any lender flex provisions contained in such fee letter), or (z) seek more equity than is committed in the equity commitment letter.

 

Cooperation of infoGROUP

 

We have agreed to, and have agreed to cause our subsidiaries to (and to use our reasonable best efforts to cause our and their respective representatives to) provide such cooperation as may be reasonably requested by Parent in connection with the arrangement of the debt and equity financing, including:

 

 

 

The Company has further agreed to use its reasonable best efforts to periodically update any financial or other information as may be reasonably requested by Parent so that Parent may most effectively access the financing markets. The Company has also agreed that if Parent reasonably requests that the Company file a report on Form 8-K that contains material non-public information with respect to the Company, which Parent reasonably determines to include in a customary offering memorandum for such debt, then, upon the Company’s review of and satisfaction with such filing, the Company shall file such report on Form 8-K; provided, however, that the Company shall not be required to file any information on Form 8-K that the Company reasonably determines are reasonably likely to be competitively harmful to the Company.

 

The parties have further agreed that none of the Company or any of its subsidiaries, or any of their respective officers, advisors or representatives, will be required to incur any liability with respect to the financing prior to consummation of the Merger.

 

Debt and Equity Financing

 

Subject to the terms and conditions of the Merger Agreement, each of Parent and Acquisition Sub have agreed to use their reasonable best efforts to obtain the financing on the terms and conditions set forth in the equity commitment letter and debt commitment letter, and shall not permit any modification to be made to, or waiver of any provision or remedy under, the financing letters, if the modification or waiver:

 

 

 

Each of Parent and Acquisition Sub have agreed to use its reasonable best efforts to:

 

 

Parent and Acquisition Sub may amend the debt commitment letter to add lenders, lead arrangers, bookrunners, syndication agents or similar entities that had not executed the debt commitment letter as of the date of the Merger Agreement, or otherwise replace or amend the debt commitment letter, so long as: