Classmates.com 2005 Annual Report Download - page 32

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price offered by a potential acquirer. In addition, our board of directors adopted a stockholder rights plan, which is an anti-takeover measure that
will cause substantial dilution to a person who attempts to acquire our company on terms not approved by our board of directors.
Our stock price has been highly volatile and may continue to be volatile.
The market price of our common stock has fluctuated significantly since our stock began trading on the Nasdaq National Market in
September 2001 and it is likely to continue to be volatile with extreme volume fluctuations. In addition, the Nasdaq National Market, where most
publicly held Internet companies are traded, has experienced substantial price and volume fluctuations. These broad market and industry factors
may harm the market price of our common stock, regardless of our actual operating performance, and for this or other reasons we could suffer
significant declines in the market price of our common stock.
ITEM 1B. UNRESOLVED STAFF COMMENTS
None.
ITEM 2. PROPERTIES
We currently maintain the following principal facilities:
Our corporate headquarters are located in Woodland Hills, California, and we also maintain offices in Renton, Washington; New York,
New York; Brisbane, California; Orem, Utah; Hyderabad, India; and Munich, Germany. We believe that our existing facilities are adequate to
meet our current requirements and that suitable additional or substitute space will be available as needed to accommodate any physical
expansion of our corporate and operations facilities, customer support and technology centers or for any additional sales offices.
ITEM 3.
LEGAL PROCEEDINGS
On April 20, 2001, Jodi Bernstein, on behalf of himself and all others similarly situated, filed a lawsuit in the United States District Court
for the Southern District of New York against NetZero, certain officers and directors of NetZero and the underwriters of NetZero’s initial public
offering, Goldman Sachs Group, Inc., BancBoston Robertson Stephens, Inc. and Salomon Smith Barney, Inc. The complaint alleges that the
prospectus through which NetZero conducted its initial public offering in September 1999 was materially false and misleading because it failed
to disclose, among other things, that (i) the underwriters had solicited and received excessive and undisclosed commissions from certain
investors in exchange for which the underwriters allocated to those investors material portions of the restricted number of NetZero shares issued
in connection with the offering; and (ii) the underwriters had entered into agreements with customers whereby the underwriters agreed to
allocate NetZero shares to those customers in the offering in exchange for which the customers agreed to purchase additional NetZero shares in
the aftermarket at pre-determined prices. Plaintiffs are seeking injunctive relief and damages. Additional lawsuits setting forth substantially
similar allegations were also served against NetZero on behalf of additional plaintiffs in
31
Facilities
Location
Approximate
Square Feet
Lease
Expiration
Principal executive and corporate
offices
Woodland Hills, California
112,000
2014
Operations facility
Renton, Washington
61,000
2009
Customer support and technology
facility
Hyderabad, India
30,000
2008
Operations and technology facility
New York, New York
23,000
2010
Operations facility
Orem, Utah
16,000
2010