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UNITED ONLINE, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
2. ACQUISITIONS (Continued)
The weighted-average amortizable life of the acquired intangible assets is 6.4 years. The acquisition was treated as an acquisition of net
assets for tax purposes and, accordingly, the $49.1 million of goodwill acquired is tax deductible.
The following summarized unaudited pro forma information assumes that the acquisition of MyPoints had occurred on January 1, 2006 and
2005 (in thousands, except per share amounts):
The Names Database
In March 2006, the Company acquired The Names Database for approximately $10.1 million in cash, including acquisition costs. The
Names Database is a global social networking service that acts as an intermediary between members, allowing them to send messages through
the Web site to one another. The acquisition was accounted for under the purchase method in accordance with SFAS No. 141. The primary
reason for the acquisition was to acquire The Names Database's member relationships and software, which had the effect of expanding the
Company's social networking services. This factor contributed to a purchase price in excess of the fair value of The Names Database's net
liabilities assumed and intangible assets acquired, and, as a result, the Company has recorded goodwill in connection with this transaction. The
Names Database's results of operations are included in the Company's consolidated financial statements from the date of acquisition.
F-21
Year Ended
December 31,
2006
2005
Revenues
$
535,647
$
563,343
Income before cumulative effect of accounting change
$
41,518
$
48,540
Net income
$
42,559
$
48,540
Basic net income per share:
Income before cumulative effect of accounting change
$
0.65
$
0.79
Net income
$
0.66
$
0.79
Diluted net income per share:
Income before cumulative effect of accounting change
$
0.63
$
0.76
Net income
$
0.64
$
0.76