Infogroup (NASDAQ: IUSA), announced today that the Securities and
Exchange Commission (SEC) has entered an administrative Order concluding
its investigation of the Company. The investigation was first announced
by the Company in November 2007.
The terms of the Order are consistent with the Company’s October 20,
2009 announcement that it had reached an agreement in principle with the
Denver Regional Office of the SEC, to resolve these matters. The Company
will not pay any financial penalty.
Under the Order, the Company, without admitting or denying liability,
agreed it will not in the future violate Sections 13(a), 13(b) and 14(a)
of the Securities 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 solicitation of
proxies comply with the securities laws.
In the Order, the SEC noted that in reaching its decision to resolve the
investigation of the Company on these terms, it considered Infogroup’s
remedial efforts and cooperation with the SEC investigation. The Order
referred to these remedial measures:
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Replacing officers and directors
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Creating a new position of executive vice president for business
conduct and general counsel
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Instituting mandatory director and executive officer training programs
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Hiring an independent compensation consultant to advise on
compensation matters
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Implementing new internal control procedures and policies concerning
reimbursement for expenses, perquisites and related party transactions.
The Order also referred to the cooperative efforts of the Company’s
Special Litigation Committee, which investigated allegations in a civil
lawsuit by shareholders about the compensation of and misuse of
corporate funds by Vinod Gupta, the Company’s former Chief Executive
Officer. Gupta was removed from the CEO position as part of the
resolution of the shareholder lawsuit. Another element of the Company’s
cooperation with the SEC which was noted in the Order were its efforts
to review and analyze several years of records about undisclosed
compensation to Gupta.
Bill Fairfield, Infogroup’s Chief Executive Officer, stated that "we are
pleased to have concluded the SEC investigation on an acceptable basis
so that all of our associates can continue to focus on the needs of our
customers.” He added that "the Company is gratified that the SEC has
formally acknowledged our numerous remedial efforts and the lengths to
which we went in cooperating with the investigation.” He also said that
he was "also pleased to have resolved these matters administratively
instead of through the courts as others in the investigation have been
required to do.”
The SEC announced today that it filed suit in federal court in Omaha
against Mr. Gupta, Vasant Raval, a former director of the Company, and
Stormy Dean and Raj Das, former Company officers, based on various
violations of the securities laws. Gupta and Raval entered into Final
Judgments to resolve the suits against them. Under the law of the State
of Delaware, where the Company is incorporated, the Company may have
obligations to indemnify Dean and Das for their expenses in connection
with the SEC’s lawsuits against them.
About Infogroup
Infogroup (NASDAQ: IUSA) is the leading
provider of data and interactive resources that enables targeted sales,
effective marketing and insightful research solutions. Our information
powers innovative tools and insight for businesses to efficiently reach
current and future customers through multiple channels, including the
world’s most dominant and powerful Internet search engines and GPS
navigation systems. Infogroup’s headquarters are located at 5711 South 86th
Circle, Omaha, NE 68127. For more information, call (402) 593-4500 or
visit www.Infogroup.com.
Statements in this announcement other than historical data and
information constitute forward looking statements that involve risks and
uncertainties that could cause actual results to differ materially from
those stated or implied by such forward-looking statements. The
potential risks and uncertainties include, but are not limited to,
recent changes in senior management, the successful integration of
recent and future acquisitions, fluctuations in operating results,
failure to successfully carry out our Internet strategy or to grow our
Internet revenue, effects of leverage, changes in technology and
increased competition. More information about potential factors that
could affect the company’s business and financial results is included in
the company’s filings with the Securities and Exchange Commission.
