Classmates.com 2009 Annual Report Download - page 112

Table of Contents
UNITED ONLINE, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. DESCRIPTION OF BUSINESS, BASIS OF PRESENTATION, ACCOUNTING POLICIES, AND RECENT ACCOUNTING
PRONOUNCEMENTS
Description of Business
United Online, Inc. (together with its subsidiaries, "United Online", "UOL" or the "Company") is a leading provider of consumer products
and services over the Internet through a number of brands, including FTD, Interflora, Classmates, NetZero, and MyPoints. On August 26, 2008,
the Company completed its acquisition of 100% of the capital stock of FTD Group, Inc. (together with its subsidiaries, "FTD"). The Company
reports its business in three reportable segments: FTD, Classmates Media and Communications. The Company's FTD segment provides floral
and related products and services to consumers and retail florists, as well as to other retail locations offering floral and related products and
services. The Company's Classmates Media services are online social networking and online loyalty marketing. The Company's primary
Communications services are Internet access and email. On a combined basis, the Company's Web properties attract a significant number of
Internet users and the Company offers a broad array of Internet marketing services for advertisers.
United Online, Inc. is a Delaware corporation that commenced operations in 2001 following the merger of Internet access providers
NetZero, Inc. and Juno Online Services, Inc. In April 2004, the Company acquired the Web hosting and domain name registration business of
About Web Services, Inc. (now known as United Online Web Services, Inc.), and in November 2004, the Company acquired Classmates
Online, Inc. ("Classmates"), a leading provider of online social networking services. In March 2006, the Company acquired The Names
Database, a global online social networking service. In April 2006, the Company acquired MyPoints.com, Inc. ("MyPoints"), a leading provider
of online loyalty marketing services. In August 2008, the Company acquired FTD, a leading provider of floral and related products and services
under the FTD and Interflora brands. The Company's corporate headquarters are located in Woodland Hills, California, and the Company also
maintains offices in Fort Lee, New Jersey; Seattle, Washington; San Francisco, California; Schaumburg, Illinois; Downers Grove, Illinois;
Sleaford, England; Erlangen, Germany; Berlin, Germany; and Hyderabad, India.
The Company believes that its existing cash and cash equivalents, and cash generated from operations will be sufficient to service its debt
obligations and fund its working capital requirements, capital expenditures, dividend payments, and other obligations through at least the next
twelve months.
Basis of Presentation
The accompanying consolidated financial statements for the years ended December 31, 2009, 2008 and 2007 include United Online, Inc.
and its subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation. The consolidated financial
statements, in the opinion of management, reflect all adjustments (consisting only of normal recurring adjustments) that are necessary for a fair
presentation of the results for the periods shown. The results of operations for such periods are not necessarily indicative of the results expected
for any future periods.
The preparation of financial statements in accordance with accounting principles generally accepted in the United States of America
("GAAP") requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of
contingent liabilities and the reported amounts of revenues and expenses. Actual results could differ from these estimates and assumptions.
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