NEW YORK, May 4, 2012 /PRNewswire/ -- Third Point LLC,
owners of 5.8% of Yahoo! shares, sent the following letter today to
the Yahoo! Board of Directors:
May 4, 2012
Board of Directors
Yahoo! Inc.
701 First Avenue
Sunnyvale, CA 94089
Dear Board of Directors:
Yahoo!'s initial response yesterday to Third Point's
identification of material inaccuracies in both CEO Scott Thompson's and Director Patti Hart's educational record was insulting to
shareholders. We assume that these initial statements were
attributable to Mr. Thompson and were not made with the Board's
approval. While we appreciate the Board's statement late last
night that it would conduct an investigation, unfortunately, for
this Board and this Company, it is too little and months too
late.
To assert that years of inaccurate SEC filings, website
biographies and, most likely, D&O questionnaires and
curriculum vitae (including, presumably, the CV
provided to Yahoo! when Mr. Thompson reached out for the job) were
"inadvertent" is, in our view, the height of arrogance. Mr.
Thompson and the Board should make no mistake: this is a big
deal. CEO's have been terminated for less at other companies.
The Company's Preliminary Proxy Statement filed on
April 27, 2012 (at page 22) states
that the "minimum qualification for service as a director of the
Company are that a nominee possess. . . an impeccable reputation of
integrity and competence in his or her personal and professional
activities."
Furthermore, Yahoo!'s response "confirming" that Ms. Hart
"specialized" in Marketing and Economics, rather than having earned
her degree in such subjects (as Ms. Hart has asserted in filings
for years) is a similar canard. A "specialty" is not a
major. It is not a "minor". We don't know what it is,
but we do know that like Mr. Thompson, Ms. Hart has been
misrepresenting her actual degree to the investing public for
years. Again, we hope that the Board does not accept this
feeble attempt at "spin" as a justification for Ms. Hart's
misrepresentations.
Irreparable damage to Yahoo!'s culture will continue every day
that the Board allows Mr. Thompson and Ms. Hart to remain at the
helm of the Company after having clearly demonstrated that they
lack even the "minimum qualifications for service as a director of
the Company." Mr. Thompson, in particular, cannot possibly
have any credibility remaining with the all-important Yahoo!
engineers, many of which earned real – not invented – degrees in
computer science. Moreover, permitting Mr. Thompson and Ms.
Hart to stay with the Company after apparently violating the Code
of Ethics sends a message to all Yahoo! employees that a different
set of rules applies at the top.
Third Point, Yahoo!'s largest outside shareholder with over
$1 billion invested, called yesterday
for an immediate investigation if our assertions were true.
The Board appears to have acceded to this demand. Its
response must be swift and decisive. In that regard, Third
Point will consider it grounds for further action if the Board does
not take the following steps by Noon
EDT on Monday, May 7th:
1) Publicly reveal the process by which
it vetted Mr. Thompson as a potential CEO candidate. This
disclosure should include the release of all minutes of any meeting
at which Mr. Thompson's candidacy was discussed and any reports or
other materials upon which directors relied to evaluate Mr.
Thompson's candidacy.
2) Disclose whether any Board member,
including Maynard Webb, who has
long-standing ties to Mr. Thompson, and Ms. Hart, who headed the
Search Committee, was aware of Mr. Thompson's deception prior to
receipt of Third Point's letter yesterday.
3) Provide shareholders with all
information regarding the director nomination process, including
the so-called "skills matrix" referred to in the Company's
preliminary proxy statement, which the Board purportedly used to
determine the qualifications of various candidates, including Third
Point's nominees.
4) Terminate Mr. Thompson for cause
immediately given his demonstrable unsuitability to remain Chief
Executive Officer and a director of Yahoo! and accept the
resignation of Ms. Hart for similar reasons.
Finally, we urge the Board to stop wasting valuable company
resources and drop its resistance to placing the Third Point
nominees on the Board. We are prepared to join
immediately. Once on the Board, our first tasks will be to
work with the remaining Board members to find Yahoo! a new leader
with the qualifications and integrity to lead the Company and
install best practices of corporate governance. The Company
can ill afford to continue this misguided fight with its largest
outside shareholder while it has so many other fires to put
out. There has been enough damage already.
Sincerely,
Daniel S. Loeb
Chief Executive Officer
Third Point LLC
About Third Point LLC: Third Point LLC is an
SEC-registered investment adviser headquartered in New York, managing $9.0
billion in assets. Founded in 1995, Third Point
follows an event-driven approach to investing globally.
Third Point and the other Participants (defined below) have
filed with the Securities and Exchange Commission (the "SEC") a
preliminary proxy statement and accompanying proxy card in
connection with its solicitation of proxies for the election of Mr.
Daniel S. Loeb, Mr. Harry J. Wilson, Mr. Michael J. Wolf and Mr. Jeffrey A. Zucker at the Company's 2012 Annual
Meeting of Shareholders (the "Annual Meeting").
THE PARTICIPANTS STRONGLY ADVISE ALL SHAREHOLDERS OF THE COMPANY
TO READ THE PRELIMINARY PROXY STATEMENT, THE DEFINITIVE PROXY
STATEMENT, THE ACCOMPANYING PROXY CARDS AND OTHER DOCUMENTS RELATED
TO THE SOLICITATION OF PROXIES BY Third Point, Daniel S. Loeb, Third Point Offshore Master Fund
L.P., Third Point Ultra Master Fund L.P., Third Point Partners
L.P., Third Point Partners Qualified L.P., Third Point Reinsurance
Company Ltd., Lyxor/Third Point Fund Limited, dbX-Risk Arbitrage 11
Fund, Harry J. Wilson, Michael J. Wolf and Jeffrey A. Zucker (collectively, the
"Participants"), FROM the SHAREHOLDERS OF THE COMPANY, FOR USE AT
THE ANNUAL MEETING, WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL
CONTAIN IMPORTANT INFORMATION. SUCH MATERIALS WILL, ALONG
WITH OTHER RELEVANT DOCUMENTS, BE AVAILABLE AT NO CHARGE ON THE
SEC'S WEBSITE AT HTTP://WWW.SEC.GOV. IN ADDITION, THE
PARTICIPANTS IN THE SOLICITATION WILL PROVIDE COPIES OF THE PROXY
STATEMENT WITHOUT CHARGE UPON REQUEST. REQUESTS FOR COPIES
SHOULD BE DIRECTED TO THE PARTICIPANTS' PROXY SOLICITOR,
MACKENZIE PARTNERS, INC. AT ITS
TOLL-FREE NUMBER (800) 322-2855 OR VIA EMAIL AT
PROXY@MACKENZIEPARTNERS.COM.
IMPORTANT INFORMATION RELATING TO THE ABOVE-NAMED PARTICIPANTS
IN THIS PROXY SOLICITATION, INCLUDING THEIR DIRECT OR indirect
interests in the COMPANY, by security holdings or otherwise, is
contained in the preliminary proxy statement filed by Third Point
and the other Participants with the SEC on March 21, 2012, which document is available at no
charge at the SEC's website at http://www.sec.gov. WHEN
COMPLETED, the definitive proxy statement will be available to
shareholders of the COMPANY at no charge at the SEC's website at
http://www.sec.gov or by contacting the participants' proxy
solicitor, MacKenzie Partners, Inc. at its toll-free number (800)
322-2855 or via email at PROXY@MACKENZIEPARTNERS.COM.
SOURCE Third Point LLC