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Table of Contents
UNITED ONLINE, INC.
NOTES TO PARENT COMPANY FINANCIAL STATEMENTS
1. BASIS OF PRESENTATION
The financial statements for United Online, Inc. (the "Parent Company") summarize the results of operations and cash flows of the Parent
Company for the years ended December 31, 2011, 2010 and 2009 and its financial position at December 31, 2011 and 2010.
In these statements, the Parent Company's investment in subsidiaries is stated at cost plus equity in undistributed earnings of subsidiaries
since the date the Parent Company began consolidating them ("date of acquisition"). The Parent Company's share of net income of its
subsidiaries is included in net income using the equity method. The Parent Company financial statements should be read in conjunction with the
consolidated financial statements of United Online, Inc. for the corresponding years.
Under the terms of the Credit Agreement, FTD Group, Inc., a subsidiary of United Online, Inc., is generally restricted from transferring
funds to United Online, Inc., with certain exceptions, including an annual basket of $15 million (subject to adjustment based on excess cash flow
calculations) which may be used to make cash dividends, loans and advances to United Online, Inc., provided certain terms and conditions
specified in the Credit Agreement are satisfied. These restrictions have resulted in restricted net assets (as defined in Rule 4-08(e)(3) of
Regulation S-X) of FTD Group, Inc. and its subsidiaries totaling $262.1 million at December 31, 2011, which exceeded 25% of the consolidated
net assets of United Online, Inc. and its subsidiaries.
2. DIVIDENDS RECEIVED FROM SUBSIDIARIES
During the year ended December 31, 2011, FTD Group, Inc. paid a $15.0 million dividend to the Parent Company. During the years ended
December 31, 2010 and 2009, no dividends were paid to the Parent Company by its subsidiaries.
F-49