Classmates.com 2006 Annual Report Download - page 23

We may stop paying quarterly cash dividends on our common stock.
Commencing with the second quarter of 2005, we have declared and paid a quarterly cash dividend of $0.20 per share of common stock.
The payment of future dividends is discretionary and will be subject to determination by our Board of Directors each quarter following its review
of our financial condition, results of operations and cash flows and such other factors as are deemed relevant by our board of directors. Our
future cash flows may significantly decline due to declines in our dial-up Internet access business, the payment of income taxes and other
factors, and our cash balances will decline if we use our cash to acquire businesses or technologies, repurchase stock or for other purposes. A
change in our business needs, including working capital and funding for acquisitions, or a change in tax laws relating to dividends, could cause
our Board of Directors to decide to cease the payment of, or reduce, the dividend in the future. We cannot assure you that we will continue to
pay quarterly cash dividends, and if we do not, our stock price could be negatively impacted.
We have anti-takeover provisions that may make it difficult for a third party to acquire us.
Provisions of our certificate of incorporation, our bylaws and Delaware law could make it difficult for a third party to acquire us, even if
doing so might be beneficial to our stockholders because of a premium 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 Stock Market in
September 2001 and it is likely to continue to be volatile with extreme volume fluctuations. In addition, the Nasdaq Stock Market, where most
publicly-held Internet companies are traded, has experienced substantial price and volume fluctuations. The broad market and industry factors
that influence or affect such fluctuations 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
Our corporate headquarters is located in Woodland Hills, California, and consists of leased space of approximately 0.1 million square feet.
Office space is also leased in New York, New York; Fort Lee, New Jersey; and Hyderabad, India, and is generally used by our Communications
segment. Additionally, office space is also leased in Renton, Washington; San Francisco, California; Schaumburg, Illinois; Orem, Utah;
Erlangen, Germany; and Berlin, Germany, and is generally used by our Content & Media segment.
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
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