The undersigned stockholder of U.S. AUTO PARTS NETWORK, INC. (the “Company”) hereby appoints SHANE EVANGELIST and AMY B. KRALLMAN, and each of them, proxies of the undersigned, each with full power to act without the other and with power of substitution, to represent the undersigned at the Annual Meeting of Stockholders of the Company to be held on Tuesday, May 5, 2009 at 10:30 a.m. Pacific Time at the Torrance Marriott South Bay, located at 3635 Fashion Way, Torrance, California 90503, and at any adjournment or postponement thereof, and to vote all shares of the Company’s common stock held of record by the undersigned on March 16, 2009, with all the powers the undersigned would possess if personally present, in accordance with the instructions on the reverse hereof.
The undersigned hereby revokes any other proxy to vote at such Annual Meeting of Stockholders and hereby ratifies and confirms all that said proxies, and each of them, may lawfully do by virtue hereof. The undersigned also acknowledges receipt of the Notice of the Annual Meeting of Stockholders, the proxy statement and the annual report on Form 10-K for the year ended December 31, 2008, which were furnished with this proxy.
(continued and to be signed on the reverse side)
(continued from other side)
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN ACCORDANCE WITH THE INSTRUCTIONS BELOW, OR IF NO INSTRUCTIONS ARE INDICATED, THIS PROXY WILL BE VOTED FOR PROPOSALS ONE, TWO AND THREE, AND IN
ACCORDANCE WITH THE DISCRETION OF THE PROXY HOLDERS WITH REGARD TO ANY OTHER MATTERS PROPERLY BROUGHT TO A VOTE AT THE ANNUAL MEETING OR ANY ADJOURNMENT OR POSTPONEMENT THEREOF.
NOTE: This proxy must be signed exactly as your name appears hereon. Executors, administrators, trustees, etc., should give full title as such. If the stockholder is a corporation, a duly authorized officer should sign on behalf of the corporation and should indicate his or her title.
PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY CARD PROMPTLY USING THE ENCLOSED ENVELOPE.
1. Election of Class II Directors.
2. Approval of stock option exchange program.
3. Ratification of Ernst & Young LLP as the independent auditors of U.S. Auto Parts Network, Inc. for the fiscal year ending December 31, 2009.
Exhibit 99.2 Dear Employees,
We have been exploring ways to address employee stock option grants that are deeply “underwater,” meaning the exercise price is significantly higher than our current share price. I’m pleased to announce that we are asking stockholders to approve a one-time, voluntary exchange program that would allow you to exchange Eligible Options, at a 2-for-1 ratio, for new options. Eligible Options would be those options having an exercise price greater than $4.90 per share and not owned by directors or Excluded Officers as described in our preliminary proxy statement, which has been filed with the SEC.
Option exchanges are governed by SEC and NASDAQ regulations. Details of the proposed exchange program are outlined in our preliminary proxy statement, which can be found at http://www.sec.gov . Stockholders will vote on the proposal to approve the exchange program at our annual stockholders’ meeting on May 5, 2009. Should we receive the required stockholder approval and the Board of Directors determines to proceed with and commence the program, we will have up to six months after stockholder approval to commence the program.
Until stockholders approve the program and we decide to move forward, there’s nothing you need to do. We will provide you with additional information at that time.
Shane
The option exchange described in this letter has not yet commenced. US Auto Parts Network, Inc. will file a Tender Offer Statement on Schedule TO with the Securities and Exchange Commission, or SEC, upon the commencement of the option exchange. Persons who are eligible to participate in the option exchange should read the Tender Offer Statement on Schedule TO and other related materials when those materials become available, because they will contain important information about the option exchange.
Exhibit 99.3 Communication Guidelines for Proposed Stock Option Exchange Program
To all managers:
Today we announced that we are seeking stockholder approval to permit an option exchange program to replace certain of our underwater options with new options. You should have received an email from Shane Evangelist earlier today with the announcement.
Assuming we receive the necessary stockholder approval at our Annual Meeting of Stockholders on May 5, 2009 and the Board decides to commence the program, we will provide everyone with more detailed updated information and will hold sessions with employees to provide them with appropriate information to make an informed decision on whether and how to participate in the option exchange.
Option exchanges are governed by SEC rules and regulations and they are very careful about making sure that everyone involved receives all the same information. Therefore, all written and recorded information provided on the option exchange must be filed with the SEC . Since you are a manager within USAP, you will likely be asked questions by your people or third parties. Communications between you and employees or third parties are subject to these SEC requirements, so you need to be extremely careful about what you say.
Please use the communication guidelines below when responding to questions and comments. Failure to do so could result in our having to take a series of complicated (and expensive) corrective actions. I am asking for your strict adherence to the requirements below:
If you have any questions, please contact me.
Thank you for your attention to this important issue. The option exchange is an important opportunity for our employees, and I know that each of you will follow these requirements.
Sincerely, Amy
The Option Exchange Program described in the Preliminary Proxy Statement, CEO’s email, and the communication email to employees has not commenced and will not commence unless the requisite stockholder approval is obtained at the Company’s 2009 Annual
Meeting of Stockholders and the Board determines to proceed with and commence the program. Even if the requisite stockholder approval is obtained, the Company may still decide later not to implement the Option Exchange Program. The Company will file a Tender Offer Statement on Schedule TO with the SEC upon the commencement of the Option Exchange Program. Persons who may be eligible to participate in the Option Exchange Program should read the Tender Offer Statement on Schedule TO, including the offer to exchange and other related materials, when those materials become available and before they decide whether to exchange because they will contain important information about the Option Exchange Program. USAP stockholders and option holders will be able to obtain these written materials and other documents filed by USAP with the SEC free of charge from the SEC website at www.sec.gov or via the USAP website at http://investor.usautoparts.net .
• Answer questions only by referring people to our proxy statement and Shane’s email to all employees. Once the tender offer documents are filed with the SEC, there will be more information available that employees can reference.
• Prior to the commencement of the exchange program: do not guarantee that the exchange program will start by any given date.
Our Board of Directors, the Compensation Committee and Shane will determine if and when to begin the option exchange program.
• Do not answer a question via email or by leaving a voicemail. SEC rules require us to file all written and recorded communications about the exchange program with the SEC. SEC filings are expensive (so we want to minimize the number of filings we have to make). If incorrect information is given to employees or third parties, or if anyone is given information that someone else doesn’t have, we will have to take a series of complicated (and expensive) corrective steps.
• If you forget and leave a voicemail or send an email, immediately contact me .
• Do not give any advice about whether someone should participate in the program .
• If someone asks a question that is not covered by the materials we have provided, please refer them to me.