Juno 2010 Annual Report Download

Download and view the complete annual report

Please find the complete 2010 Juno annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 333

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131
  • 132
  • 133
  • 134
  • 135
  • 136
  • 137
  • 138
  • 139
  • 140
  • 141
  • 142
  • 143
  • 144
  • 145
  • 146
  • 147
  • 148
  • 149
  • 150
  • 151
  • 152
  • 153
  • 154
  • 155
  • 156
  • 157
  • 158
  • 159
  • 160
  • 161
  • 162
  • 163
  • 164
  • 165
  • 166
  • 167
  • 168
  • 169
  • 170
  • 171
  • 172
  • 173
  • 174
  • 175
  • 176
  • 177
  • 178
  • 179
  • 180
  • 181
  • 182
  • 183
  • 184
  • 185
  • 186
  • 187
  • 188
  • 189
  • 190
  • 191
  • 192
  • 193
  • 194
  • 195
  • 196
  • 197
  • 198
  • 199
  • 200
  • 201
  • 202
  • 203
  • 204
  • 205
  • 206
  • 207
  • 208
  • 209
  • 210
  • 211
  • 212
  • 213
  • 214
  • 215
  • 216
  • 217
  • 218
  • 219
  • 220
  • 221
  • 222
  • 223
  • 224
  • 225
  • 226
  • 227
  • 228
  • 229
  • 230
  • 231
  • 232
  • 233
  • 234
  • 235
  • 236
  • 237
  • 238
  • 239
  • 240
  • 241
  • 242
  • 243
  • 244
  • 245
  • 246
  • 247
  • 248
  • 249
  • 250
  • 251
  • 252
  • 253
  • 254
  • 255
  • 256
  • 257
  • 258
  • 259
  • 260
  • 261
  • 262
  • 263
  • 264
  • 265
  • 266
  • 267
  • 268
  • 269
  • 270
  • 271
  • 272
  • 273
  • 274
  • 275
  • 276
  • 277
  • 278
  • 279
  • 280
  • 281
  • 282
  • 283
  • 284
  • 285
  • 286
  • 287
  • 288
  • 289
  • 290
  • 291
  • 292
  • 293
  • 294
  • 295
  • 296
  • 297
  • 298
  • 299
  • 300
  • 301
  • 302
  • 303
  • 304
  • 305
  • 306
  • 307
  • 308
  • 309
  • 310
  • 311
  • 312
  • 313
  • 314
  • 315
  • 316
  • 317
  • 318
  • 319
  • 320
  • 321
  • 322
  • 323
  • 324
  • 325
  • 326
  • 327
  • 328
  • 329
  • 330
  • 331
  • 332
  • 333

UNITED ONLINE INC
FORM 10-K
(Annual Report)
Filed 02/28/11 for the Period Ending 12/31/10
Address 21301 BURBANK BOULEVARD
WOODLAND HILLS, CA 91367
Telephone 8182873000
CIK 0001142701
Symbol UNTD
SIC Code 7370 - Computer Programming, Data Processing, And
Industry Computer Services
Sector Technology
Fiscal Year 12/31
http://www.edgar-online.com
© Copyright 2011, EDGAR Online, Inc. All Rights Reserved.
Distribution and use of this document restricted under EDGAR Online, Inc. Terms of Use.

Table of contents

  • Page 1
    ... ONLINE INC FORM 10-K (Annual Report) Filed 02/28/11 for the Period Ending 12/31/10 Address Telephone CIK Symbol SIC Code Industry Sector Fiscal Year 21301 BURBANK BOULEVARD WOODLAND HILLS, CA 91367 8182873000 0001142701 UNTD 7370 - Computer Programming, Data Processing, And Computer Services...

  • Page 2
    Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K (Mark One) 3 ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Fiscal Year Ended December 31, 2010 Or 1 TRANSITION REPORT PURSUANT TO SECTION 13 OR 15...

  • Page 3
    ... 1 Smaller reporting company 1 No 3 Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2) of the Act). Yes 1 At June 30, 2010, the aggregate market value of voting stock held by non-affiliates of the Registrant, based on the last reported sales price of the...

  • Page 4
    ... amortization; tax payments; foreign currency exchange rates; hedging arrangements; our ability to repay indebtedness, pay dividends and invest in initiatives; our products and services; pricing and revenue streams; competition; strategies; and new business initiatives, products, services, features...

  • Page 5
    .... Reported results should not be considered an indication of future performance. Except as required by law, we undertake no obligation to publicly release the results of any revision to these forward-looking statements that may be made to reflect events or circumstances after the date hereof...

  • Page 6
    ... Media Communications Floral and related products and services for consumers, retail florists and other retail locations Online nostalgia services and online loyalty marketing services Internet access, email, Internet security, and web hosting services Prior to this Annual Report on Form 10-K, our...

  • Page 7
    ...does not currently generate products revenues. • Advertising revenues. Advertising revenues are derived from a wide variety of advertising, marketing and media-related initiatives in each of our operating segments. Industry Background FTD Segment-Floral and Related Products and Services Consumers...

  • Page 8
    ...deliver floral orders. Additional products and services offered by providers of floral network services include: point-of-sale and related technology systems and services, credit card processing services, e-commerce website services, online advertising tools, telephone answering, order taking, order...

  • Page 9
    ...bundled" with telephone, entertainment or other services, which generally results in lower prices than stand-alone services. At the same time, the maturity of the dial-up Internet access market has led the largest dial-up service providers in the U.S., including AOL, EarthLink, NetZero, and Juno, to...

  • Page 10
    ... Internet access providers in the U.S., although a small number of national providers account for a significant majority of the U.S. dial-up market. AOL, EarthLink and our Internet access businesses, NetZero and Juno, on a combined basis reported approximately 5.5 million dial-up Internet access pay...

  • Page 11
    ... logo, supported by various marketing campaigns; access to the floral networks; credit card processing services; e-commerce website services; online advertising tools; and telephone answering, order taking, order transmission, and clearing-house services. FTD also provides point-of-sale and related...

  • Page 12
    ... extent, from advertising fees and other transactions on our website. All-Access Pass holders have access to a variety of premium features. We expect the features available to free users and All-Access Pass holders to continue to change from time to time. Premium features currently include, among...

  • Page 13
    ... based on performance measures that include when our MyPoints emails are transmitted to members, when members respond to emails and when members complete online transactions. Communications Our principal Communications pay service is dial-up Internet access, offered under the NetZero and Juno brands...

  • Page 14
    ..., with the free services subject to hourly and other limitations. Basic pay dial-up Internet access services include Internet access and an email account. In addition, we offer accelerated dial-up Internet access services which can significantly reduce the time required for certain web pages to load...

  • Page 15
    ... provide effective solutions for advertisers. Communications Our Communications services generate advertising revenues from search placements, display advertisements and online market research associated with our Internet access and email services. We host and customize the initial website displayed...

  • Page 16
    ... and personal computer manufacturers; advertising on the Internet and television; and direct marketing campaigns. These activities are designed to drive prospective members to call our toll-free telephone numbers to purchase our services, or to visit our websites and download our software. In...

  • Page 17
    ... 1A of this Annual Report on Form 10-K. Floral and Related Products and Services We compete in the market for flowers and, to a lesser degree, gifts. In the consumer market, consumers are our customers for direct sales of floral products and gifts through our websites and telephone numbers. In the...

  • Page 18
    ... of our competitors. Our dial-up Internet access services do not compete favorably with broadband services with respect to certain of these factors, including, but not limited to, speed and, in certain cases, price. Online Loyalty Marketing The market for online loyalty marketing services is highly...

  • Page 19
    ... Communications segments pay us in advance with a credit card. Other payment options for some of our pay services include automated clearing-house ("ACH"), personal check, money order, or via a customer's local telephone bill. Internet access pay accounts that elect to pay with a personal check or...

  • Page 20
    ... and managed modem services. We license from third parties a number of our software applications and components, including applications for our billing, customer support, advertising, and database systems, our client and server applications, and portions of our dial-up Internet access accelerator...

  • Page 21
    ... for information about executive officers of the Registrant. Available Information Our corporate website is www.unitedonline.com . On this website, we make available, free of charge, our annual, quarterly and current reports (including all amendments to such reports), changes in the stock ownership...

  • Page 22
    ... of, or projections made by, our management or the financial analysts. In the event we do not achieve such expectations or projections, our financial results and the price of our common stock could be adversely affected. New business initiatives, products, services, or features may not be successful...

  • Page 23
    ... has purchased our subscription services or floral products, as applicable. Although we expect to offer our members and customers services or products at the end of our registration or sale processes, including third-party offers as well as our own offers, we do not expect the revenues from such...

  • Page 24
    ...as credit card processors. Key systems include, without limitation, order transmission, fulfillment and processing including the system for transmitting orders through the floral network; billing; website and database management; customer support; telecommunications network management; advertisement...

  • Page 25
    ... of Contents marketing, billing, customer retention, renewal, cancelation, refund, or disclosure practices. The Federal Trade Commission and certain state agencies have investigated Internet companies, including us, in connection with consumer protection and privacy matters. In addition, we have...

  • Page 26
    ...third parties include our marketing offers in the emails they send. An increase in the number of members or customers who elect to not receive, or are unable to receive, our emails could adversely affect our business and results of operations. From time to time, Internet service providers block bulk...

  • Page 27
    ...assets; and lack of, or inadequate, controls, policies and procedures appropriate for a public company, and the time, cost and difficulties related to the implementation of such controls, policies and procedures or the remediation of any deficiencies. • Any of these risks could harm our business...

  • Page 28
    ...significant charge to earnings if we are required to expense certain costs or impair our assets. We have capitalized goodwill and identifiable intangible assets in connection with our acquisitions and certain business initiatives such as the content archives on the Memory Lane website. We perform 26

  • Page 29
    ... to impose additional income taxes, sales and use taxes, value-added taxes or other taxes on our business activities and Internet-based transactions, including our past sales, which could decrease our ability to compete, reduce our sales, or have a material adverse effect on our business, financial...

  • Page 30
    ... in currency exchange rates; potentially adverse tax consequences, including the complexities of foreign value-added taxes and restrictions on the repatriation of earnings; increased financial accounting, tax and reporting burdens and complexities; disruption of our ongoing business and significant...

  • Page 31
    ... our customers for direct sales of floral products and gifts through our websites and telephone numbers. In the floral network services market, retail florists and supermarkets are our principal customers for memberships and subscriptions to our various floral network services, including access to...

  • Page 32
    Table of Contents credit card processing services, e-commerce website services, online advertising tools, telephone answering, order taking, order transmission, and clearing-house services. The consumer market for flowers and gifts is highly competitive as consumers can purchase the products we ...

  • Page 33
    ... an adverse effect on our business, financial condition, results of operations, and cash flows. Many factors, such as weather conditions, agricultural limitations and restrictions relating to the management of pests and disease, affect the supply of flowers and the price of our floral products. If...

  • Page 34
    ... and telephonic sales channels could result in the imposition of additional sales and use tax or other tax obligations. Additionally, in accordance with current industry practice by international floral and gift direct marketers and our interpretation of applicable law, we collect and remit value...

  • Page 35
    ... be successful and could adversely affect Internet traffic to the website, the visitor's experience, as well as our key metrics, including the number of free accounts, pay accounts, active accounts, and visitors to the website generally. We intend to add new forms of content and social interaction...

  • Page 36
    ... terms, which affects the timing of subscription expirations, as well as the degree of credit card failures. We must continually add new pay accounts both to replace pay accounts who churn and to grow our business beyond our current pay account base. We expect that our churn rate will continue to...

  • Page 37
    ... Internet access services do not compete favorably with broadband services with respect to connection speed and do not have a significant, if any, price advantage over certain broadband services. Many broadband providers, including cable companies and local exchange carriers, bundle their offerings...

  • Page 38
    ... account, we expect that our Communications services revenues, advertising revenues, and the profitability of this segment will continue to decline over time. The number of dial-up Internet access pay accounts has been adversely impacted by both a decrease in the number of new pay accounts signing...

  • Page 39
    ..., as the dial-up Internet access market declines and new technologies emerge, we will be able to continue to effectively distribute and deliver our services. ITEM 1B. None. ITEM 2. PROPERTIES UNRESOLVED STAFF COMMENTS Our corporate headquarters are located in Woodland Hills, California and consist...

  • Page 40
    ... third-party vendors. In addition, in 2010, Classmates Online, Inc. received a subpoena from the Attorney General for the District of Columbia regarding its marketing, billing, and renewal practices, including, without limitation, its post-transaction sales practices. We have been cooperating with...

  • Page 41
    ... to that, NetZero common stock had been quoted on NASDAQ under the symbol "NZRO" since September 23, 1999. The following table sets forth, for the quarters indicated, the high and low sales prices per share of our common stock as reported on the NASDAQ. 2009 High Low High 2010 Low First Quarter...

  • Page 42
    ... stock units that vest and from the stock awards that are issued, the portion of those shares with a fair market value equal to the amount of the employee withholding taxes due, which is accounted for as a repurchase of common stock. We then pay the applicable required employee withholding taxes...

  • Page 43
    ... of the Company, the Nasdaq Composite and the MS Internet Index and assumes reinvestment of any dividends. The stock price performance on the following graph is not necessarily indicative of future stock price performance. Dec-05 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 United Online, Inc. Nasdaq...

  • Page 44
    ... statements and related notes and Management's Discussion and Analysis of Financial Condition and Results of Operations included elsewhere in this Annual Report on Form 10-K. The following table presents the consolidated statements of operations data for the years ended December 31, 2010, 2009 and...

  • Page 45
    ...and online loyalty marketing. Our primary Communications segment service is Internet access. On a combined basis, our web properties attract a significant number of Internet users, and we offer a broad range of Internet marketing services for advertisers. Segment Definitions We report our businesses...

  • Page 46
    ...to attract new, or retain existing, paying subscribers; changes in the mix of pay services and the related pricing plans; increases or decreases in the price of our services; the timing of pay accounts being added or removed during a period; and the average foreign currency exchange rate between the...

  • Page 47
    ... online loyalty marketing members who have earned or redeemed points during such period. Communications segment active accounts include all Communications segment pay accounts as of the date presented combined with the number of free Internet access and email accounts that logged on to our services...

  • Page 48
    Table of Contents represented by international pay accounts which, on average, have lower-priced subscription plans compared to U.S. pay accounts, and the churn rate. Quarter Ended June 30, 2010 December 31, 2010 September 30, 2010 March 31, 2010 December 31, 2009 Consolidated: Revenues (in ...

  • Page 49
    ... the service period. Advance payments from pay accounts are recorded on the consolidated balance sheets as deferred revenue. We offer alternative payment methods to credit cards for certain pay service plans. These alternative payment methods currently include use of ACH, payment by personal check...

  • Page 50
    Table of Contents Advertising revenues for our online loyalty marketing service consist primarily of fees generated when emails are transmitted to members, when members respond to emails and when members complete online transactions. Each of these activities is a discrete, independent activity, ...

  • Page 51
    ... Online, MyPoints, and Communications-for purposes of evaluating goodwill. These reporting units each constitute a business or group of businesses for which discrete financial information is available and is regularly reviewed by segment management. The goodwill related to our acquired businesses...

  • Page 52
    ... a number of factors, including projections of the amounts and timing of future revenues and cash flows, assumed discount rates and other assumptions. Under the market approach, using the guideline company method, a reporting unit's fair value is estimated based on multiples of the cash-free market...

  • Page 53
    ...they respond to direct marketing offers delivered by MyPoints, purchase goods or services from advertisers, engage in certain promotional campaigns of advertisers, or engage in other specified activities. The member redemption liability is estimated based upon the weighted-average cost and number of...

  • Page 54
    ... of fees charged to its floral network members for access to the FTD and Interflora brands and the Mercury Man logo, access to the floral networks, credit card processing services, e-commerce website services, online advertising tools, telephone answering, order taking, order transmission, and...

  • Page 55
    ... and online market research associated with our Internet access and email services. Advertising revenues also include intercompany commissions from our Content & Media segment which are included in reported segment results and are eliminated upon consolidation. Cost of Revenues FTD FTD cost of...

  • Page 56
    ...fees; costs related to providing customer support; costs related to customer billing and billing support for our pay accounts; fees associated with the storage and processing of customer credit cards and associated bank fees; and domain name registration fees. Sales and Marketing Sales and marketing...

  • Page 57
    ... intangible assets principally includes amortization of: acquired pay accounts and free accounts; certain acquired trademarks and trade names; purchased software and technology; acquired customer and advertising contracts and related relationships; acquired rights, content and intellectual property...

  • Page 58
    ...2008 (date of acquisition) to December 31, 2008 Content & Media Year Ended December 31, 2010 2009 2008 Communications Year Ended December 31, 2010 2009 2008 Year Ended December 31, 2010 Revenues: Services $ Products Advertising Total revenues Operating expenses: Cost of revenues Sales and marketing...

  • Page 59
    56

  • Page 60
    ... operations (which excludes depreciation and amortization of intangible assets) to consolidated operating income (loss) was as follows for each period presented (in thousands): Year Ended December 31, 2009 2008 2010 Segment income (loss) from operations: FTD Content & Media Communications Total...

  • Page 61
    ...for the years ended December 31, 2010 and 2009. Year Ended December 31, 2010 2009 Revenues Operating expenses: Cost of revenues Sales and marketing Technology and development General and administrative Amortization of intangible assets Restructuring charges Total operating expenses Operating income...

  • Page 62
    ...by $2.7 million, or 8%, to $32.1 million for the year ended December 31, 2010, compared to $34.8 million for the year ended December 31, 2009. The decrease was primarily due to certain intangible assets related to our acquisition of Classmates Online, Inc. and its subsidiaries in 2004 becoming fully...

  • Page 63
    ... included nonoperating income related to a non-income tax refund and a favorable legal settlement. Provision for Income Taxes. For the year ended December 31, 2010, we recorded a provision for income taxes of $36.2 million on pretax income of $89.9 million, resulting in an effective income tax rate...

  • Page 64
    ....9% for the year ended December 31, 2010, compared to 16.4% for the prior-year period. The increase was primarily due to higher marketing expenditures related to television advertising for the Valentine's Day and U.S. Mother's Day holidays in 2010 and higher customer service costs, partially offset...

  • Page 65
    ... prior-year period. The increase of $0.5 million was primarily due to a $1.5 million increase in the cost of points earned by members of our online loyalty marketing service and a $0.7 million increase in overhead-related costs, partially offset by a $1.3 million decrease in credit card processing...

  • Page 66
    ...to $167.2 million for the year ended December 31, 2010, compared to $211.2 million for the year ended December 31, 2009. The decrease was primarily due to a $39.9 million decrease in services revenues as a result of a 27% decrease in our average number of dial-up Internet access pay accounts from 63

  • Page 67
    ...dialup Internet access services due to a decrease in the number of dial-up Internet access pay accounts and a decrease in hourly usage per pay account and a $3.1 million decrease in customer support and billing-related costs due to a decrease in the number of dial-up Internet access pay accounts. In...

  • Page 68
    ... to continuing declines in the number of dial-up Internet access pay accounts. Communications Restructuring Charges. Communications restructuring charges decreased by $41,000, or 3%, to $1.3 million for the year ended December 31, 2010, compared to $1.4 million for the year ended December 31, 2009...

  • Page 69
    ... related to our FTD, Content & Media and Communications segments constituted 79.5%, 8.6% and 12.0%, respectively, of our total segment cost of revenues for the year ended December 31, 2009, compared to 52.0%, 19.9% and 28.1%, respectively, for the year ended December 31, 2008. Sales and Marketing...

  • Page 70
    ... Assets and Long-Lived Assets. There were no impairment charges for the year ended December 31, 2009, compared to $176.2 million for the year ended December 31, 2008. Impairment charges for the year ended December 31, 2008 were primarily due to a reduction in the fair value of the FTD reporting unit...

  • Page 71
    ... charges, the effective income tax rate for the year ended December 31, 2008 would have been 43.5%. The current rate has declined primarily due to the effects of net benefits resulting from statute expirations of uncertain tax positions offset partially by the limitation of foreign tax credits. FTD...

  • Page 72
    ... public filings of FTD Group, Inc. are available at the SEC's website at www.sec.gov . Year Ended December 31, 2008 (Combined) 2009 (in thousands, except average order value and average currency exchange rates) % Change Revenues Operating expenses: Cost of revenues Sales and marketing Technology...

  • Page 73
    ...the year ended December 31, 2009, compared to 60.2% for the prior-year period. Cost of revenues as a percentage of revenues was positively impacted by a shift in the mix of products and services sold as well as by cost reductions, primarily related to shipping costs. FTD Sales and Marketing Expenses...

  • Page 74
    ... 14.8% for the year ended December 31, 2009, compared to 17.9% for the prior-year period. The decrease of $6.1 million was largely related to a $3.8 million decrease in the cost of points earned by members of our online loyalty marketing service as a result of a decrease in revenues generated by our...

  • Page 75
    ...31.7% for the year ended December 31, 2009, compared to 35.5% for the prior-year period. The decrease of $7.0 million was largely the result of a $5.8 million decrease in marketing costs related to acquiring new online nostalgia services members and online loyalty marketing members. The decrease was...

  • Page 76
    ... revenues decreased as a result of a $2.8 million decrease in customer supportand billing-related costs due to a decrease in the number of dial-up Internet access pay accounts, a $0.7 million decrease in costs associated with our web hosting business primarily as a result of the closure of our Orem...

  • Page 77
    ... costs related to our dial-up Internet access services and, to a lesser extent, a $6.1 million decrease in personnel- and overhead-related expenses as a result of reduced headcount. The decrease was partially offset by a one-time, out-of-period adjustment of $1.4 million related to marketing...

  • Page 78
    ...for the year ended December 31, 2010, compared to the year ended December 31, 2009. Net cash provided by operating activities is driven by our net income adjusted for changes in working capital and non-cash items, including, but not limited to, depreciation and amortization, stock-based compensation...

  • Page 79
    ... restricted stock units that vest and the stock awards that are issued, the portion of those shares with a fair market value equal to the amount of the required employee withholding taxes due. We then pay the applicable withholding taxes in cash. The withholding of these shares, although accounted...

  • Page 80
    ... will vary based on our stock price and the number of applicable restricted stock units vesting and stock awards being issued during the year. Based on our current projections, we expect to continue to generate positive cash flows from operations, at least in the next twelve months. We may use our...

  • Page 81
    ..., stock-based compensation, impairment of goodwill, intangible assets and long-lived assets, deferred taxes, tax benefits from equity awards and changes in operating assets and liabilities. The year ended December 31, 2009 includes the results of FTD, which we acquired in August 2008. Net income...

  • Page 82
    ... business combination included in the reported pro forma revenue and earnings. The amendments in this update are effective prospectively for business combinations for which the acquisition date is on or after the beginning of the first annual reporting period beginning on or after December 15, 2010...

  • Page 83
    ...effective date of the disclosures about troubled debt restructurings in ASU 2010-20 for public entities. The delay is intended to allow time to determine what constitutes a troubled debt restructuring. The effective date of the new...years ended December 31, 2010, 2009 and 2008, and we do not currently...

  • Page 84
    ...de-designated and accordingly does not currently qualify for hedge accounting treatment. As a result, subsequent fluctuations in the market value of the interest rate cap are recorded in our results of operations. For the year ended December 31, 2010, the amount recorded in our results of operations...

  • Page 85
    ... that, as of the end of such period, the Company's disclosure controls and procedures are effective in recording, processing, summarizing, and reporting, on a timely basis, information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act and are...

  • Page 86
    ..., management has determined that, at December 31, 2010, the Company's internal control over financial reporting was effective. The Company's internal control over financial reporting at December 31, 2010 has been audited by PricewaterhouseCoopers LLP, an independent registered public accounting firm...

  • Page 87
    ... DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE The information required by Item 10 is included under the following captions in our definitive proxy statement relating to our 2011 annual meeting of stockholders to be filed with the SEC within 120 days after the end of our fiscal year and is...

  • Page 88
    ... have been omitted because the information required to be set forth therein is not applicable, not required or is shown in the consolidated financial statements or notes related thereto. 3. Exhibits: The agreements included as exhibits to this Annual Report on Form 10-K contain representations...

  • Page 89
    Table of Contents No. Exhibit Description Filed with this Form 10-K Incorporated by Reference to Form File No. Date Filed 2.1 Stock Purchase Agreement, dated as of April 9, 2006, by and between United Online, Inc. and UAL Corporation 2.2 Agreement and Plan of Merger, dated April 30, 2008, among...

  • Page 90
    ... 10.14 Form of Stock Option Agreement for 2010 Incentive Compensation Plan (officers version I) 10.15 Form of Stock Option Agreement for 2010 Incentive Compensation Plan (officers version II) 10.16 Amended and Restated United Online, Inc. Severance Benefit Plan 10.17 Employment Agreement between the...

  • Page 91
    the Registrant and Frederic A. Randall, Jr. 87

  • Page 92
    ... Jordan 10.30 Restricted Stock Unit Issuance Agreement(s) Amendment Agreement between United Online, Inc. and Robert J. Taragan 10.31 United Online, Inc. 2010 Management Bonus Plan 10.32 Office Lease between LNR Warner Center, LLC and NetZero, Inc. 10.33 Credit Agreement, dated as of August 4, 2008...

  • Page 93
    manager and administrative agent 88

  • Page 94
    ... 11, 2008, among United Online, Inc., the lenders party thereto from time to time and Silicon Valley Bank, as administrative agent 21.1 List of Subsidiaries 23.1 Consent of Independent Registered Public Accounting Firm 24.1 Power of Attorney (see signature page of this Annual Report on Form 10-K) 31...

  • Page 95

  • Page 96
    Table of Contents SIGNATURES Pursuant to the requirements of Section 13 of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized on February 28, 2011. UNITED ONLINE, INC. By: /s/ MARK R. GOLDSTON Mark...

  • Page 97
    Table of Contents Signature Title Date /s/ DENNIS HOLT Director Dennis Holt /s/ HOWARD G. PHANSTIEL Director Howard G. Phanstiel /s/ CAROL A. SCOTT Director Carol A. Scott 91 February 28, 2011 February 28, 2011 February 28, 2011

  • Page 98
    ... this Annual Report on Form 10-K and in the Company's other public filings, which are available without charge through the SEC's website at www.sec.gov. No. Exhibit Description Filed with this Form 10-K Incorporated by Reference to Form File No. Date Filed 2.1 Stock Purchase Agreement, dated as...

  • Page 99
    ... and U.S. Stock Transfer Corporation 10.1 Form of Indemnification Agreement 10.2 2001 Stock Incentive Plan 10.3 FTD Group, Inc. 2005 Equity Incentive Award Plan, Amended and Restated as of October 29, 2008 10.4 2010 Incentive Compensation Plan 10.5 Form of Restricted Stock Unit Issuance Agreement...

  • Page 100
    ... by Reference to Form File No. Date Filed 10.11 Form of Restricted Stock Unit Issuance Agreement for 2010 Incentive Compensation Plan (nonemployee directors-annual grant) 10.12 Form of Restricted Stock Unit Issuance Agreement for 2010 Incentive Compensation Plan (officers) 10.13 Form of Restricted...

  • Page 101
    Agreement Amendment Agreement between United Online, Inc. and Mark R. Goldston 94

  • Page 102
    ... Jordan 10.30 Restricted Stock Unit Issuance Agreement(s) Amendment Agreement between United Online, Inc. and Robert J. Taragan 10.31 United Online, Inc. 2010 Management Bonus Plan 10.32 Office Lease between LNR Warner Center, LLC and NetZero, Inc. 10.33 Credit Agreement, dated as of August 4, 2008...

  • Page 103
    95

  • Page 104
    Table of Contents No. Exhibit Description Filed with this Form 10-K Incorporated by Reference to Form File No. Date Filed 32.2 Certification of the Chief Financial Officer... XBRL Taxonomy Extension Definition Document X 000-33367 2/28/2011 X X X X X X 000-33367 000-33367 000-33367 000-33367...

  • Page 105
    Table of Contents UNITED ONLINE, INC. INDEX TO CONSOLIDATED FINANCIAL STATEMENTS Page Report of Independent Registered Public Accounting Firm Consolidated Balance Sheets Consolidated Statements of Operations Consolidated Statements of Comprehensive Income (Loss) Consolidated Statements of ...

  • Page 106
    ... the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement and whether effective internal control over financial...

  • Page 107
    ... 31, 2010 and 2009, respectively Deferred tax assets, net Other current assets Total current assets Property and equipment, net Goodwill Intangible assets, net Other assets Total assets Liabilities and Stockholders' Equity Current liabilities: Accounts payable Accrued liabilities Member redemption...

  • Page 108
    Table of Contents UNITED ONLINE, INC. CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except per share amounts) Year Ended December 31, 2009 2008 2010 Revenues: Services Products Total revenues Operating expenses: Cost of revenues-services Cost of revenues-products Sales and marketing ...

  • Page 109
    Table of Contents UNITED ONLINE, INC. CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (in thousands) Year Ended December 31, 2009 2008 2010 Net income (loss) Change in unrealized loss on short-term investments, net of tax of $0, $0 and $(102) for the years ended December 31, 2010, 2009 and...

  • Page 110
    ... stock units Stock-based compensation Change in unrealized loss on short-term investments, net of tax Foreign currency translation Tax shortfalls from equity awards Net loss Balance at December 31, 2008 Exercises of stock options Issuance of common stock through employee stock purchase plan...

  • Page 111
    ... on shares outstanding and restricted stock units Change in dividend equivalents payable on restricted stock units Stock-based compensation Foreign currency translation Tax shortfalls from equity awards Net income Balance at December 31, 2010 1,824 - - - - (6,842) - - - - - (6,842) - - (36...

  • Page 112
    ... from employee stock purchase plans Repurchases of common stock Dividends and dividend equivalents paid on outstanding shares and restricted stock units Excess tax benefits from equity awards Net cash provided by (used for) financing activities Effect of foreign currency exchange rate changes on...

  • Page 113
    restricted stock units Reduction in goodwill in connection with a release of a portion of the valuation allowance for deferred tax assets Issuance of common stock in connection with the acquisition of FTD (see Note 12) $ $ $ (138) $ - $ - $ 207 $ - $ 385 128 - $ 126,151 The accompanying notes ...

  • Page 114
    ... is Internet access. 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. The Company's corporate headquarters are located in Woodland Hills, California, and the Company...

  • Page 115
    ... insurance provided on such deposits. Accounts Receivable, including Financing Receivables -The Company's accounts receivable are derived primarily from revenue earned from advertising customers and floral network members located in the U.S. and the U.K., and pay accounts. The Company extends credit...

  • Page 116
    ... is reduced and related credit allowance adjusted accordingly. Fair value approximates the carrying amount of financing receivables because such receivables are discounted at a rate comparable to market. Property and Equipment -Property and equipment are stated at historical cost less accumulated...

  • Page 117
    ...excess of the purchase price of an acquired entity over the fair value of the net tangible and intangible assets acquired. Indefinite-lived intangible assets acquired in a business combination are initially recorded at management's estimate of their fair values. The Company accounts for goodwill and...

  • Page 118
    ... , which addresses financial accounting and reporting for the impairment and disposition of identifiable intangible assets and other long-lived assets. Intangible assets acquired in a business combination are initially recorded at management's estimate of their fair values. The Company evaluates the...

  • Page 119
    Table of Contents UNITED ONLINE, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) 1. DESCRIPTION OF BUSINESS, BASIS OF PRESENTATION, ACCOUNTING POLICIES, AND RECENT ACCOUNTING PRONOUNCEMENTS (Continued) carrying amount of the assets exceeds the fair market value of the assets. Definite-...

  • Page 120
    ... accounts are recorded on the consolidated balance sheets as deferred revenue. The Company offers alternative payment methods to credit cards for certain Communications pay service plans. These alternative payment methods currently include use of automated clearing-house ("ACH"), payment by personal...

  • Page 121
    ... to providing customer support; costs related to customer billing and billing support for the Company's pay accounts and floral network members; fees associated with the storage and processing of customer credit cards and associated bank fees; and domain name registration fees. Sales and Marketing...

  • Page 122
    ... net book value of capitalized computer software costs related to the internal development and production of computer software to be sold, leased or otherwise marketed was $9.5 million and $12.0 million, respectively. During the years ended December 31, 2010, 2009 and 2008, the Company amortized and...

  • Page 123
    ...In addition, general and administrative expenses include, among other costs, professional fees for legal, accounting and financial services; insurance; occupancy and other overhead-related costs; office relocation costs; non-income taxes; gains and losses on sales of assets; and expenses incurred as...

  • Page 124
    Table of Contents UNITED ONLINE, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) 1. DESCRIPTION OF BUSINESS, BASIS OF PRESENTATION, ACCOUNTING POLICIES, AND RECENT ACCOUNTING PRONOUNCEMENTS (Continued) that will be in effect when the differences are expected to reverse. The Company ...

  • Page 125
    ...of additional updates. 2. SEGMENT INFORMATION Segment revenues and segment income (loss) from operations were as follows (in thousands): Year Ended December 31, 2010 Content & Media Communications FTD Total Services Products Advertising Total segment revenues Segment income from operations $ 119...

  • Page 126
    Table of Contents UNITED ONLINE, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) 2. SEGMENT INFORMATION (Continued) A reconciliation of segment revenues to consolidated revenues was as follows for each period presented (in thousands): Year Ended December 31, 2009 2008 2010 Segment ...

  • Page 127
    ... 31, 2010 totaled $4.0 million. Other Current Assets Other current assets consisted of the following (in thousands): December 31, 2010 2009 Prepaid expenses-other Floral-related inventories Income taxes receivable Gift cards related to member redemption liability Prepaid advertising and promotions...

  • Page 128
    ... years ended December 31, 2010, 2009 and 2008 was $26.4 million, $24.8 million and $21.4 million, respectively. Accrued Liabilities Accrued liabilities consisted of the following (in thousands): December 31, 2010 2009 Employee compensation and related expenses Income taxes payable Non-income taxes...

  • Page 129
    ... deferred tax assets within one year of acquisition. Intangible Assets Intangible assets consisted of the following (in thousands): December 31, 2010 Accumulated Amortization Gross Value Net Pay accounts and free accounts Customer contracts and relationships Trademarks and trade names Software...

  • Page 130
    Table of Contents UNITED ONLINE, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) 4. GOODWILL, INTANGIBLE ASSETS AND OTHER LONG-LIVED ASSETS (Continued) Gross Value December 31, 2009 Accumulated Amortization Net Pay accounts and free accounts Customer contracts and relationships ...

  • Page 131
    ..., dividends, asset sales, and the incurrence of additional debt and liens. Impairment charges recorded by the Company do not impact covenants contained in the FTD Credit Agreement. The changes in the Company's debt balances, net of discounts, for the years ended December 31, 2009 and 2010 were as...

  • Page 132
    ... quoted prices in active markets that are observable either directly or indirectly (Level 2) and (iii) unobservable inputs that require the Company to use present value and other valuation techniques in the determination of fair value (Level 3). The following table presents information about assets...

  • Page 133
    Table of Contents UNITED ONLINE, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) 6. FAIR VALUE MEASUREMENTS (Continued) determining the market interest yield curve, the Company considered, among other factors, its estimate of its credit rating. The Company estimated its credit rating ...

  • Page 134
    ... stock units that vest, and from the stock awards that are issued, the portion of those shares with a fair market value equal to the amount of the required employee withholding taxes due, which is accounted for as a repurchase of common stock. The Company then pays the applicable withholding taxes...

  • Page 135
    ... stock units, stock awards and stock options. Restricted stock units granted to employees generally vest over a one- to four-year period under a variety of vesting schedules and are canceled upon termination of employment. Restricted stock units granted to non-employee members of United Online...

  • Page 136
    ... (in thousands): Year Ended December 31, 2010 2009 2008 Operating expenses: Cost of revenues-services Cost of revenues-products Sales and marketing Technology and development General and administrative Total stock-based compensation Tax benefit recognized Restricted Stock Units $ 502 $ 943...

  • Page 137
    ... a grant-date fair value equal to $9.3 million to certain of the Company's non-executive officer employees. The restricted stock units will vest as to twenty-five percent of the total number of shares awarded annually over a four-year period beginning February 15, 2011. Stock Option Exchange Program...

  • Page 138
    ... Recent Awards Effective February 15, 2011, the Compensation Committee of the Board of Directors of United Online, Inc. (the "Compensation Committee") approved grants of 2.4 million stock options with a grant-date fair value equal to $4.7 million to certain members of the Company's senior management...

  • Page 139
    ...rate assumed in valuing the employee stock purchase plan shares is based on the U.S. Treasury yield curve in effect at the time of grant for the expected term. The Company determines the expected dividend yield percentage by dividing the expected annual dividend by the closing market price of United...

  • Page 140
    Table of Contents UNITED ONLINE, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) 9. INCOME TAXES (Continued) The provision for income taxes was comprised of the following (in thousands): Year Ended December 31, 2009 2008 2010 Current: Federal State Foreign Deferred: Federal State ...

  • Page 141
    Table of Contents UNITED ONLINE, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) 9. INCOME TAXES (Continued) The significant components of net deferred tax balances were as follows (in thousands): December 31, 2010 2009 Deferred tax assets: Net operating loss and foreign tax credit ...

  • Page 142
    ...'s effective income tax rate. The changes in gross unrecognized tax benefits for the years ended December 31, 2010, 2009 and 2008 were as follows, excluding interest and penalties (in thousands): Balance at January 1, 2008 Additions due to FTD acquisition Additions related to current year positions...

  • Page 143
    ... 22 positions and the Company recorded restructuring charges totaling $1.3 million related to employee termination benefits. All costs related to the elimination of these positions were recognized and incurred in the December 2010 quarter. In addition, in the year ended December 31, 2010, the...

  • Page 144
    ... and FTD's market position, and expanded marketing opportunities and efficiencies. The Company believed that certain of these primary factors supported the amount of goodwill recorded as a result of the purchase price paid for FTD, in relation to other acquired tangible and intangible assets. In the...

  • Page 145
    ... United Online, Inc.'s election to substitute additional cash in lieu of seller notes as merger consideration. The purchase price for the acquisition was allocated to tangible and intangible assets acquired and liabilities assumed based on their estimated fair values at the Closing Date. The Company...

  • Page 146
    ... related leases. In addition, standby letters of credit are maintained by FTD to secure credit card processing activity. Certificates of deposit of $0.5 million and $1.1 million maintained by the Company in connection with certain of these letters of credit are included in other current assets and...

  • Page 147
    ... to customers, vendors, lessors, sureties and insurance companies, business partners, and other parties with respect to certain matters, including, but not limited to, losses arising out of the Company's breach of such agreements, services to be provided by the Company, or from intellectual property...

  • Page 148
    ... 300 issuers that conducted their initial public offerings between 1998 and 2000, their underwriters and an unspecified number of their individual corporate officers and directors. The parties in the approximately 300 coordinated class actions, including NetZero, the underwriter defendants in the...

  • Page 149
    ... vendors. In addition, in 2010, Classmates Online, Inc. received a subpoena from the Attorney General for the District of Columbia regarding its marketing, billing, and renewal practices, including, without limitation, its posttransaction sales practices. The Company has been cooperating with these...

  • Page 150
    Table of Contents UNITED ONLINE, INC. SCHEDULE I-CONDENSED FINANCIAL INFORMATION OF REGISTRANT PARENT COMPANY BALANCE SHEETS (in thousands) December 31, 2010 2009 Assets Current assets: Cash and cash equivalents Other current assets Total current assets Investments in subsidiaries Other assets ...

  • Page 151
    Table of Contents UNITED ONLINE, INC. PARENT COMPANY STATEMENTS OF OPERATIONS (in thousands) Year Ended December 31, 2009 2008 2010 Revenues Operating expenses: General and administrative Total operating expenses Operating loss Interest income Intercompany interest income Interest expense Other ...

  • Page 152
    Table of Contents UNITED ONLINE, INC. PARENT COMPANY STATEMENTS OF CASH FLOWS (in thousands) Year Ended December 31, 2009 2008 2010 Net cash provided by operating activities Cash flows from investing activities: Purchases of short-term investments Proceeds from maturities of short-term ...

  • Page 153
    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, 2010, 2009 ...

  • Page 154
    ... Period Tax Valuation Allowance Charged to Income Tax Provision Charged to Other Accounts Tax Valuation Allowance Credited to Income Tax Provision Balance at End of Period Valuation allowance for deferred tax assets: Year ended December 31, 2010 Year ended December 31, 2009 Year ended December...

  • Page 155

  • Page 156
    ... Restricted Stock Units . The Corporation hereby awards to the Participant, as of the Award Date, Restricted Stock Units under the Plan. Each Restricted Stock Unit represents the right to receive one share of Common Stock on the applicable issuance date following the vesting of that unit. The number...

  • Page 157
    .... 3. Cessation of Service . Except as otherwise provided in Paragraphs 4 and 6 below, should the Participant cease to serve as a Board member for any reason prior to vesting in the Shares subject to this Award, then the awarded Restricted Stock Units will be immediately cancelled with respect to...

  • Page 158
    ...no event later than three (3) business days following such effective date. 7. Adjustment in Shares . Should any change be made to the Common Stock by reason of any stock split, stock dividend, recapitalization, combination of shares, exchange of shares, spin-off transaction or other change affecting...

  • Page 159
    ... of Common Stock pursuant to the Award shall be subject to compliance by the Corporation and Participant with all applicable requirements of law relating thereto and with all applicable regulations of the Stock Exchange on which the Common Stock is listed for trading at the time of such issuance...

  • Page 160
    ... the requirements or limitations of Code Section 409A applicable to such short-...limitations of Code Section 409A and the Treasury Regulations thereunder that apply to such exception. IN WITNESS WHEREOF , the parties have executed this Agreement on the day and year first indicated above. UNITED ONLINE...

  • Page 161
    ... the election of Board members), (ii) the closing of a sale, transfer or other disposition of all or substantially all of the Corporation's assets, (iii) the closing of any transaction or series of related transactions pursuant to which any person or any group of persons comprising a "group" within...

  • Page 162
    ... Stock Exchange, the Nasdaq Global or Global Select Market or the New A-2 1934 Act shall mean the Securities Exchange Act of 1934, as amended from time to time. Participant shall mean the person to whom the Award is made pursuant to the Agreement. Plan shall mean the Corporation's 2010 Incentive...

  • Page 163
    ... - ANNUAL GRANT] UNITED ONLINE, INC. RESTRICTED STOCK UNIT ISSUANCE AGREEMENT RECITALS A. The Board has adopted the Plan for the purpose of retaining the services of selected Employees and consultants, nonemployee Board members and other independent advisors who provide services to the Corporation...

  • Page 164
    .... 3. Cessation of Service . Except as otherwise provided in Paragraphs 4 and 6 below, should the Participant cease to serve as a Board member for any reason prior to vesting in the Shares subject to this Award, then the awarded Restricted Stock Units will be immediately cancelled with respect to...

  • Page 165
    ...no event later than three (3) business days following such effective date. 7. Adjustment in Shares . Should any change be made to the Common Stock by reason of any stock split, stock dividend, recapitalization, combination of shares, exchange of shares, spin-off transaction or other change affecting...

  • Page 166
    ... of Common Stock pursuant to the Award shall be subject to compliance by the Corporation and Participant with all applicable requirements of law relating thereto and with all applicable regulations of the Stock Exchange on which the Common Stock is listed for trading at the time of such issuance...

  • Page 167
    ...all or any part of its business or assets. In addition, this Agreement shall not in any way be construed or interpreted so as to affect adversely or otherwise impair the right of the Corporation or the stockholders to remove Participant from the Board at any time in accordance with the provisions of...

  • Page 168
    ... the election of Board members), (ii) the closing of a sale, transfer or other disposition of all or substantially all of the Corporation's assets, (iii) the closing of any transaction or series of related transactions pursuant to which any person or any group of persons comprising a "group" within...

  • Page 169
    ... Stock Exchange, the Nasdaq Global or Global Select Market or the New A-2 1934 Act shall mean the Securities Exchange Act of 1934, as amended from time to time. Participant shall mean the person to whom the Award is made pursuant to the Agreement. Plan shall mean the Corporation's 2010 Incentive...

  • Page 170
    Exhibit 10.12 [OFFICER] UNITED ONLINE, INC. RESTRICTED STOCK UNIT ISSUANCE AGREEMENT RECITALS A. The Board has adopted the Plan for the purpose of retaining the services of selected Employees and consultants and other independent advisors who provide services to the Corporation (or any Parent or ...

  • Page 171
    ... cancelled units. (b) The Participant's Employment Agreement sets forth certain terms and conditions under which Participant's equity or equity-based awards from the Corporation, including this Award, may vest in whole or in part on an accelerated basis in connection with his cessation of Service...

  • Page 172
    ... (5) business days following the payment of the actual cash dividend on the outstanding Common Stock, subject to the Corporation's collection of all applicable federal, state and local income and employment withholding taxes. (ii) For any other dividend or distribution, a special book account shall...

  • Page 173
    ...) may, in connection with the assumption or continuation of the Restricted Stock Units subject to the Award at that time, but subject to the Plan Administrator's approval prior to the Change in Control, substitute one or more shares of its own common stock with a fair market value equivalent to the...

  • Page 174
    ... for the Shares that vest under the Award, a portion of those vested Shares with a Fair Market Value (measured as of the applicable tax date for such Shares) equal to the amount of such Withholding Taxes (the "Share Withholding Method"); provided, however , that the amount of any Shares so withheld...

  • Page 175
    ... of Common Stock pursuant to the Award shall be subject to compliance by the Corporation and Participant with all applicable requirements of law relating thereto and with all applicable regulations of the Stock Exchange on which the Common Stock is listed for trading at the time of such issuance...

  • Page 176
    ... (to the extent applicable) the provisions of Paragraph 5(c) of this Agreement. IN WITNESS WHEREOF , the parties have executed this Agreement on the day and year first indicated above. UNITED ONLINE, INC. By: Title: Mark R. Goldston Chairman, President and Chief Executive Officer PARTICIPANT Name...

  • Page 177
    ... the election of Board members), (ii) the closing of a sale, transfer or other disposition of all or substantially all of the Corporation's assets, (iii) the closing of any transaction or series of related transactions pursuant to which any person or any group of persons comprising a "group" within...

  • Page 178
    ... and method of performance. J. Employment Agreement shall mean the Employment Agreement between the Participant and the Corporation (or any Parent or Subsidiary) in effect on the Award Date. K. Fair Market Value per share of Common Stock on any relevant date shall be the closing price per share of...

  • Page 179
    ... authorized by the Plan Administrator or by the Corporation's written policy on leaves of absence in effect at the time of such leave, no Service credit shall be given for vesting purposes for any period the Participant is on a leave of absence. S. York Stock Exchange. Stock Exchange shall mean the...

  • Page 180
    ...Stock Units under the Plan. Each Restricted Stock Unit represents the right to receive one share of Common Stock on the date that unit vests in accordance with the express provisions of this Agreement. The number of shares of Common Stock subject to the awarded Restricted Stock Units, the applicable...

  • Page 181
    ... equivalent payment under this subparagraph (i) shall be paid within five (5) business days following the payment of the actual cash dividend on the outstanding Common Stock, subject to the Corporation's collection of all applicable federal, state and local income and employment withholding taxes. 2

  • Page 182
    ...) may, in connection with the assumption or continuation of the Restricted Stock Units subject to the Award at that time, but subject to the Plan Administrator's approval prior to the Change in Control, substitute one or more shares of its own common stock with a fair market value equivalent to the...

  • Page 183
    ... as soon as administratively practicable thereafter, but in no event later than three (3) business days following such effective date. Such distribution shall be subject to the Corporation's collection of the applicable Withholding Taxes pursuant to the provisions of Paragraph 7. (e) This Agreement...

  • Page 184
    ... of Common Stock pursuant to the Award shall be subject to compliance by the Corporation and Participant with all applicable requirements of law relating thereto and with all applicable regulations of the Stock Exchange on which the Common Stock is listed for trading at the time of such issuance...

  • Page 185
    ... to such exception. IN WITNESS WHEREOF , the parties have executed this Agreement on the day and year first indicated above. UNITED ONLINE, INC. By: Title: Mark R. Goldston Chairman, President and Chief Executive Officer PARTICIPANT Name: Signature: 6

  • Page 186
    ... the election of Board members), (ii) the closing of a sale, transfer or other disposition of all or substantially all of the Corporation's assets, (iii) the closing of any transaction or series of related transactions pursuant to which any person or any group of persons comprising a "group" within...

  • Page 187
    ... assets or voting stock of United Online, Inc. which shall by appropriate action adopt the Plan. J. Employee shall mean an individual who is in the employ of the Corporation (or any Parent or Subsidiary), subject to the control and direction of the employer entity as to both the work to be performed...

  • Page 188
    ... or by the Corporation's written policy on leaves of absence in effect at the time of such leave, no Service credit shall be given for vesting purposes for any period the Participant is on a leave of absence. A-3 Plan shall mean the Corporation's 2010 Incentive Compensation Plan, as amended and...

  • Page 189
    ... the federal, state and local income taxes and the employee portion of the federal, state and local employment taxes required to be withheld by the Corporation in connection with the issuance of the shares of Common Stock which vest under the Award and any phantom dividend equivalents distributed...

  • Page 190
    ... the Corporation's principal offices at . Optionee may obtain a copy of the official prospectus for the Plan by accessing Optionee's portfolio on Fidelity's website (www.fidelity.com). Optionee may also obtain a printed copy of the prospectus by contacting the Stock Plan Administrator by telephoning...

  • Page 191
    DATED: , 2011 UNITED ONLINE, INC. By: Title: OPTIONEE ATTACHMENTS EXHIBIT A - STOCK OPTION AGREEMENT

  • Page 192
    EXHIBIT A UNITED ONLINE, INC. STOCK OPTION AGREEMENT RECITALS A. The Corporation has implemented the Plan for the purpose of providing eligible persons in the Corporation's service with the opportunity to participate in one or more cash or equity incentive compensation programs designed to encourage...

  • Page 193
    ...or 6. (b) Optionee's Employment Agreement sets forth certain terms and conditions under which Optionee's equity or equity-based awards from the Corporation, including this option, may vest in whole or in part on an accelerated basis in connection with his cessation of Service under various specified...

  • Page 194
    ... of time equal in duration to any interval within such post-Service exercise period during which the exercise of this option or the immediate sale of the Option Shares acquired under this option cannot be effected in compliance with applicable federal and state securities laws, but in no event shall...

  • Page 195
    ... 6(b) or (iii) the Expiration Date. (g) During the limited period of post-Service exercisability provided under this Paragraph 5, this option may not be exercised in the aggregate for more than the number of Option Shares for which this option is at the time vested and exercisable. Except to the...

  • Page 196
    ... entity (or parent thereof) may, in connection with the assumption or continuation of this option, but subject to the Plan Administrator's approval prior to the Change in Control, substitute one or more shares of its own common stock with a fair market value equivalent to the cash consideration paid...

  • Page 197
    ... charge to the Corporation's earnings for financial reporting purposes and valued at Fair Market Value on the Exercise Date; or (C) through a special sale and remittance procedure pursuant to which Optionee (or any other person or persons exercising the option) shall concurrently provide irrevocable...

  • Page 198
    ... and Optionee with all applicable requirements of law relating thereto and with all applicable regulations of any Stock Exchange on which the Common Stock is listed for trading at the time of such exercise and issuance. (b) The inability of the Corporation to obtain approval from any regulatory body...

  • Page 199
    ...to the Corporation. In no event shall this option be exercised in the absence of such acceptance. IN WITNESS WHEREOF , United Online, Inc. has caused this Agreement to be executed on its behalf by its duly-authorized officer on the day and year first indicated in the Grant Notice. UNITED ONLINE, INC...

  • Page 200
    ... the election of Board members), (ii) the closing of a sale, transfer or other disposition of all or substantially all of the Corporation's assets, (iii) the closing of any transaction or series of related transactions pursuant to which any person or any group of persons comprising a "group" within...

  • Page 201
    ... members described in clause (A) who were still in office at the time the Board approved such appointment or nomination. D. E. Code shall mean the Internal Revenue Code of 1986, as amended. Common Stock shall mean shares of the Corporation's common stock. F. Corporation shall mean United Online...

  • Page 202
    ...other Stock Exchange on which the Common Stock is then primarily traded. If there is no closing selling price for the Common Stock on the date in question, then the Fair Market Value shall be the closing selling price on the last preceding date for which such quotation exists. O. Family Member shall...

  • Page 203
    ... Plan Administrator or by the Corporation's written policy on leaves of absence in effect at the time of such leave, no Service credit shall be given for vesting purposes for any period Optionee is on a leave of absence. EE. York Stock Exchange. Stock Exchange shall mean the American Stock Exchange...

  • Page 204
    ... state and local income taxes and the employee portion of the federal, state and local employment taxes required to be withheld by the Corporation in connection with the exercise of the option. HH. II. With Cause shall have the meaning assigned to such term in the Employment Agreement. Without Cause...

  • Page 205
    ... the Corporation's principal offices at . Optionee may obtain a copy of the official prospectus for the Plan by accessing Optionee's portfolio on Fidelity's website (www.fidelity.com). Optionee may also obtain a printed copy of the prospectus by contacting the Stock Plan Administrator by telephoning...

  • Page 206
    DATED: , 2011 UNITED ONLINE, INC. By: Title: OPTIONEE ATTACHMENTS EXHIBIT A - STOCK OPTION AGREEMENT

  • Page 207
    EXHIBIT A UNITED ONLINE, INC. STOCK OPTION AGREEMENT RECITALS A. The Corporation has implemented the Plan for the purpose of providing eligible persons in the Corporation's service with the opportunity to participate in one or more cash or equity incentive compensation programs designed to encourage...

  • Page 208
    ... be exercisable only by the person or persons who acquire a proprietary interest in the option pursuant to such assignment. The terms applicable to the assigned portion shall be the same as those in effect for this option immediately prior to such assignment. 4. Dates of Exercise . This option shall...

  • Page 209
    ... of time equal in duration to any interval within such post-Service exercise period during which the exercise of this option or the immediate sale of the Option Shares acquired under this option cannot be effected in compliance with applicable federal and state securities laws, but in no event shall...

  • Page 210
    ... entity (or parent thereof) may, in connection with the assumption or continuation of this option, but subject to the Plan Administrator's approval prior to the Change in Control, substitute one or more shares of its own common stock with a fair market value equivalent to the cash consideration paid...

  • Page 211
    ...of its business or assets. 7. Adjustment in Option Shares . Should any change be made to the Common Stock by reason of any stock split, stock dividend, recapitalization, combination of shares, exchange of shares, spin-off transaction, or other change affecting the outstanding Common Stock as a class...

  • Page 212
    ... charge to the Corporation's earnings for financial reporting purposes and valued at Fair Market Value on the Exercise Date; or (C) through a special sale and remittance procedure pursuant to which Optionee (or any other person or persons exercising the option) shall concurrently provide irrevocable...

  • Page 213
    ...its principal corporate offices and directed to the attention of the Stock Plan Administrator. Any notice required to be given or delivered to Optionee shall be in writing and addressed to Optionee at the most current address then indicated for Optionee on the Corporation's employee records or shall...

  • Page 214
    ...to the Corporation. In no event shall this option be exercised in the absence of such acceptance. IN WITNESS WHEREOF , United Online, Inc. has caused this Agreement to be executed on its behalf by its duly-authorized officer on the day and year first indicated in the Grant Notice. UNITED ONLINE, INC...

  • Page 215
    ... the election of Board members), (ii) the closing of a sale, transfer or other disposition of all or substantially all of the Corporation's assets, (iii) the closing of any transaction or series of related transactions pursuant to which any person or any group of persons comprising a "group" within...

  • Page 216
    ... assets or voting stock of United Online, Inc. which shall by appropriate action adopt the Plan. H. Employee shall mean an individual who is in the employ of the Corporation (or any Parent or Subsidiary) subject to the control and direction of the employer entity as to both the work to be performed...

  • Page 217
    ...other Stock Exchange on which the Common Stock is then primarily traded. If there is no closing selling price for the Common Stock on the date in question, then the Fair Market Value shall be the closing selling price on the last preceding date for which such quotation exists. N. Family Member shall...

  • Page 218
    ... (12) months or more. Y. Plan shall mean the Corporation's 2010 Incentive Compensation Plan, as amended from time to time. Z. Plan Administrator shall mean the Compensation Committee of the Board (or a subcommittee thereof) acting in its capacity as administrator of the Plan. AA. Service shall mean...

  • Page 219
    Corporation's written policy on leaves of absence in effect at the time of such leave, no Service credit shall be given for vesting purposes for any period Optionee is on a leave of absence. BB. York Stock Exchange. Stock Exchange shall mean the American Stock Exchange, the Nasdaq Global or Global ...

  • Page 220
    Exhibit 10.16 AMENDED AND RESTATED UNITED ONLINE, INC. SEVERANCE BENEFIT PLAN AND SUMMARY PLAN DESCRIPTION Amended and Restated Effective January 1, 2010

  • Page 221
    ... regarding severance pay, except such terms as are set forth in a written agreement signed by an authorized officer of the Company or one of its subsidiaries and in effect at the time of the applicable termination of employment. This Plan supplements any such written agreements to provide all terms...

  • Page 222
    ... A , as such schedule may be revised from time to time, as a participating Employer in the Plan. "Employer Group" means the Company and each member of the group of commonly controlled corporations or other businesses that include the Company, as determined in accordance with Sections 414(b) and...

  • Page 223
    ...), (iii) any intentional misconduct adversely affecting the business or affairs of the Company (or any other member of the Employer Group), or (iv) failure to use reasonable efforts to follow reasonable directives or instructions of a manager or supervisor after written notice of such failure that...

  • Page 224
    ... check payable to "United Online, Inc.") any amount advanced but not used. 7. On or before your employment termination date, you have met with your manager and: (i) you have transitioned your work and information concerning your work to your manager; and (ii) you have provided your manager with all...

  • Page 225
    ... before your employment termination date, you have returned to the Company all items of property received by you for your use during employment with your Employer, including, but not limited to, any laptops, computer equipment, software programs, cell phones, keys and passes, and credit and calling...

  • Page 226
    ... Period, you are dismissed prior to the effective date of your Layoff Termination for a reason other than your Layoff Termination (including, but not limited to, any reason such as unsatisfactory performance, violation of applicable company policy or procedures, insubordination, misconduct, or the...

  • Page 227
    ... stated above, including (without limitation) the execution and effectiveness of the Required Release on or before applicable date specified in Section III.A.9. above, but in no event after the expiration of the sixty (60)-day period measured from the date of your Separation from Service. The actual...

  • Page 228
    ... dependents may elect temporary continuation coverage under the Company's group health benefit plans (medical, dental and/or vision), provided that you timely elect such coverage and you timely pay the full amount of premiums due. In connection with your Layoff Termination, you and your eligible...

  • Page 229
    ... under the Plan, you may submit a signed, written application to the Chief Personnel Officer of the Company within ninety (90) days after the effective date of your Layoff Termination or Involuntary Termination. 2. Denial of Application for Benefits . In the event that your application for benefits...

  • Page 230
    ...restrictions or limitations under Code Section 409A. G. No Right to Employment . No provision of this Plan is intended to provide you or any other employee with any right to continue employment with Company or any other member of the Employer Group or otherwise affect the right of the Company or any...

  • Page 231
    ... of the Company's employees who are covered by the Plan. No one, including your Employer or any other person, may terminate your employment or otherwise...court. In such a case, the court may require the Plan Administrator to provide the materials and pay you up to $110 a day until you receive the ...

  • Page 232
    ... should happen that the Plan fiduciaries misuse the Plan's assets (if any) or if you are discriminated against for asserting your rights, you may seek assistance from the U.S. Department of Labor or you may file suit in a federal court. The court will decide who should pay court costs and legal fees...

  • Page 233
    ...PLAN INFORMATION Plan Sponsor: Plan Name: Employer Identification Number Plan Number: Plan Effective Date: Plan Administrator: United Online, Inc. The United Online, Inc. Severance Benefit Plan 77-0575839 5 01 January 1, 2010 United Online, Inc. 21301 Burbank Blvd. Woodland Hills, CA 91367 Telephone...

  • Page 234
    ..., INC. HAS CAUSED THIS AMENDED AND RESTATED SEVERANCE BENEFIT PLAN AND SUMMARY PLAN DESCRIPTION TO BE EXECUTED ON ITS BEHALF BY ITS DULY AUTHORIZED OFFICER ON THE DATE AND YEAR INDICATED BELOW. UNITED ONLINE, INC. By: Title: /s/ Mark R. Goldston Chief Executive Officer Dated: November 22, 2010 15

  • Page 235
    SCHEDULE A LIST OF COVERED SUBSIDIARIES PARTICIPATING IN THE PLAN AS OF JANUARY 1, 2010 NetZero, Inc. Juno Internet Services, Inc. United Online Advertising Network, Inc. Classmates Online, Inc. MyPoints.com, Inc. FTD.COM, Inc. Florists' Transworld Delivery, Inc. 16

  • Page 236
    Exhibit 10.17 EMPLOYMENT AGREEMENT This Employment Agreement (the " Agreement ") is made and entered into effective the 6th day of December, 2010 by and between United Online, Inc., a Delaware corporation (the " Company "), with principal corporate offices at 21301 Burbank Boulevard, Woodland Hills,...

  • Page 237
    ...in connection with the business of the Company and the performance of his duties under this Agreement, subject to Employee providing the Company with reasonable documentation thereof. Any such reimbursements paid to Employee shall be made in no event later than the end of the calendar year following...

  • Page 238
    ... practicable thereafter, but in no event later than the sixtieth (60 th ) day following the date of Employee's termination of employment. With respect to Employee's outstanding options to purchase shares of the Company's Common Stock (" Option Awards "), restricted unit awards covering shares of the...

  • Page 239
    ... shares, except to the extent otherwise provided in any Restricted Unit Award granted after the date this Agreement is effective, and any shares which so vest shall be issued in accordance with the terms of the applicable award agreement; and (iii) The Company's repurchase option will lapse with...

  • Page 240
    ... the election of Board members), (ii) the closing of a sale, transfer or other disposition of all or substantially all of the Company's assets, (iii) the closing of any transaction or series of related transactions pursuant to which any person or any group of persons comprising a "group" within the...

  • Page 241
    ... into account any Excise Tax imposed on the payments and benefits provided Employee hereunder (or on any other payments or benefits to which Employee may become entitled in connection with any change in control or ownership of the Company or the subsequent termination of Employee's employment with...

  • Page 242
    ... in the absence of such deferral) shall be credited with interest at a rate equal to the Company's cost of funds and shall be paid provided to Employee in a lump sum on the first day of the seventh (7th) month after the date of Employee's separation from service or, if earlier, the first day of the...

  • Page 243
    ... hereto has executed this Agreement on the date specified therefor below. UNITED ONLINE, INC. By: /s/ Robert Berglass Name: Robert Berglass Title: Lead Independent Director, Compensation Committee Chair of United Online, Inc. Dated: December 6, 2010 By: /s/ Charles B. Ammann Name: Charles B. Ammann...

  • Page 244
    Exhibit 10.18 EMPLOYMENT AGREEMENT This Employment Agreement (the " Agreement ") is made and entered into effective the 7th day of February, 2011 (the " Effective Date ") by and between United Online, Inc. , a Delaware corporation (the " Company "), with principal corporate offices at 21301 Burbank ...

  • Page 245
    ...the Company at the time such bonus payment is paid. Employee's bonus payment for each fiscal year shall in no event be paid later than the 15th day of the third month following the end of the Company's fiscal year for which such bonus is earned. 4. Restricted Stock Units and Other Equity Awards. If...

  • Page 246
    ...accelerated basis as to that number of additional shares in which Employee would have otherwise been vested on the date of such separation from service had Employee completed an additional twelve (12) months of employment with the Company and had each applicable equity award been structured so as to...

  • Page 247
    ... the level at which the applicable performance goals for such fiscal year are in fact attained, had Employee continued in the Company's employ through the date that bonus award becomes due and payable by (B) a fraction the numerator of which is the number of whole months (rounded to the next highest...

  • Page 248
    ... longer period is required under applicable law) after the effective date of Employee's termination of employment, a comprehensive agreement releasing the Company and its officers, directors, employees, stockholders, subsidiaries, affiliates, representatives and other related parties from all claims...

  • Page 249
    ...applicable revocation period in effect for that Release. However, should such sixty (60)-day period span two taxable years, the first such monthly... term in the Company's 2010 Incentive Compensation Plan (or successor thereto), and a " Qualifying Change in Control" shall mean the date on which there ...

  • Page 250
    ... into account any Excise Tax imposed on the payments and benefits provided Employee hereunder (or on any other payments or benefits to which Employee may become entitled in connection with any change in control or ownership of the Company or the subsequent termination of Employee's employment with...

  • Page 251
    ... preceding thirty-six (36) months (or such shorter period of time in which Employee has actually been in employee status with the Company). Any such determination of Employee's separation from service shall, however, be made in accordance with the applicable standards of the Treasury Regulations...

  • Page 252
    ... this subparagraph (ii), the applicable dollar limitation will be equal to two times the lesser of (i) Employee's annualized compensation (based on Employee's annual rate of pay for the calendar year preceding the calendar year of Employee's separation from service, adjusted to reflect any increase...

  • Page 253
    ... Information and Inventions Agreement between Employee and the Company, any Company handbooks and policies in effect from time to time and the applicable stock plans and agreements evidencing the equity awards made to Employee from time to time during Employee's period of employment, contains...

  • Page 254
    ... parties hereto have executed this Agreement as of the date stated in the opening paragraph. /s/ Paul E. Jordan PAUL E. JORDAN Date signed: January 21, 2011 UNITED ONLINE, INC. By: /s/ Mark R. Goldston Mark R. Goldston Chairman, President and Chief Executive Officer Date signed: February 7, 2011 11

  • Page 255
    Exhibit 10.19 EMPLOYMENT AGREEMENT This Employment Agreement (the " Agreement ") is made and entered into effective the 7th day of February, 2011 (the " Effective Date ") by and between United Online, Inc. , a Delaware corporation (the " Company "), with principal corporate offices at 21301 Burbank ...

  • Page 256
    ...the Company at the time such bonus payment is paid. Employee's bonus payment for each fiscal year shall in no event be paid later than the 15th day of the third month following the end of the Company's fiscal year for which such bonus is earned. 4. Restricted Stock Units and Other Equity Awards. If...

  • Page 257
    ...accelerated basis as to that number of additional shares in which Employee would have otherwise been vested on the date of such separation from service had Employee completed an additional twelve (12) months of employment with the Company and had each applicable equity award been structured so as to...

  • Page 258
    ... the level at which the applicable performance goals for such fiscal year are in fact attained, had Employee continued in the Company's employ through the date that bonus award becomes due and payable by (B) a fraction the numerator of which is the number of whole months (rounded to the next highest...

  • Page 259
    ... to the date in the subsequent fiscal year on which Employee's bonus for that fiscal year would have otherwise become due and payable on the basis of the applicable performance goals attained for that year had Employee continued in employment with the Company, then the Company will pay Employee an...

  • Page 260
    ...relating to Employee's employment with the Company and the termination of that employment relationship and containing such other and additional terms as the Company deems satisfactory (the " Release ") and (ii) such Release must become effective and enforceable after the expiration of any applicable...

  • Page 261
    ... into account any Excise Tax imposed on the payments and benefits provided Employee hereunder (or on any other payments or benefits to which Employee may become entitled in connection with any change in control or ownership of the Company or the subsequent termination of Employee's employment with...

  • Page 262
    ... preceding thirty-six (36) months (or such shorter period of time in which Employee has actually been in employee status with the Company). Any such determination of Employee's separation from service shall, however, be made in accordance with the applicable standards of the Treasury Regulations...

  • Page 263
    ... this subparagraph (ii), the applicable dollar limitation will be equal to two times the lesser of (i) Employee's annualized compensation (based on Employee's annual rate of pay for the calendar year preceding the calendar year of Employee's separation from service, adjusted to reflect any increase...

  • Page 264
    ... Proprietary Information and Inventions Agreement between Employee and the Company, (a) any Company handbooks and policies in effect from time to time and the applicable stock plans and agreements evidencing the equity awards made to Employee from time to time during Employee's period of employment...

  • Page 265
    ... executed this Agreement as of the date stated in the opening paragraph. /s/ Frederic A. Randall, Jr. FREDERIC A. RANDALL, JR. Date signed: January 31, 2011 UNITED ONLINE, INC. By: /s/ Mark R. Goldston Mark R. Goldston Chairman, President and Chief Executive Officer Date signed: February 7, 2011 11

  • Page 266
    Exhibit 10.20 EMPLOYMENT AGREEMENT This Employment Agreement (the " Agreement ") is made and entered into effective the 7th day of February, 2011 (the " Effective Date ") by and between United Online, Inc. , a Delaware corporation (the " Company "), with principal corporate offices at 21301 Burbank ...

  • Page 267
    ..., the Company at the time such bonus payment is paid. Employee's bonus payment for each fiscal year shall in no event be paid later than the 15th day of the third month following the end of the Company's fiscal year for which such bonus is earned. 4. Restricted Stock Units and Other Equity Awards...

  • Page 268
    ...accelerated basis as to that number of additional shares in which Employee would have otherwise been vested on the date of such separation from service had Employee completed an additional twelve (12) months of employment with the Company and had each applicable equity award been structured so as to...

  • Page 269
    ... the level at which the applicable performance goals for such fiscal year are in fact attained, had Employee continued in the Company's employ through the date that bonus award becomes due and payable by (B) a fraction the numerator of which is the number of whole months (rounded to the next highest...

  • Page 270
    ... to the date in the subsequent fiscal year on which Employee's bonus for that fiscal year would have otherwise become due and payable on the basis of the applicable performance goals attained for that year had Employee continued in employment with the Company, then the Company will pay Employee an...

  • Page 271
    ...relating to Employee's employment with the Company and the termination of that employment relationship and containing such other and additional terms as the Company deems satisfactory (the " Release ") and (ii) such Release must become effective and enforceable after the expiration of any applicable...

  • Page 272
    ... into account any Excise Tax imposed on the payments and benefits provided Employee hereunder (or on any other payments or benefits to which Employee may become entitled in connection with any change in control or ownership of the Company or the subsequent termination of Employee's employment with...

  • Page 273
    ... preceding thirty-six (36) months (or such shorter period of time in which Employee has actually been in employee status with the Company). Any such determination of Employee's separation from service shall, however, be made in accordance with the applicable standards of the Treasury Regulations...

  • Page 274
    ... this subparagraph (ii), the applicable dollar limitation will be equal to two times the lesser of (i) Employee's annualized compensation (based on Employee's annual rate of pay for the calendar year preceding the calendar year of Employee's separation from service, adjusted to reflect any increase...

  • Page 275
    ... Proprietary Information and Inventions Agreement between Employee and the Company, (a) any Company handbooks and policies in effect from time to time and the applicable stock plans and agreements evidencing the equity awards made to Employee from time to time during Employee's period of employment...

  • Page 276
    ... the parties hereto have executed this Agreement as of the date stated in the opening paragraph. /s/ Scott H. Ray SCOTT H. RAY Date signed: January 24, 2011 UNITED ONLINE, INC. By: /s/ Mark R. Goldston Mark R. Goldston Chairman, President and Chief Executive Officer Date signed: February 7, 2011 11

  • Page 277
    Exhibit 10.21 EMPLOYMENT AGREEMENT This Employment Agreement (the " Agreement ") is made and entered into effective the 7th day of February, 2011 (the " Effective Date ") by and between United Online, Inc. , a Delaware corporation (the " Company "), with principal corporate offices at 21301 Burbank ...

  • Page 278
    ..., the Company at the time such bonus payment is paid. Employee's bonus payment for each fiscal year shall in no event be paid later than the 15th day of the third month following the end of the Company's fiscal year for which such bonus is earned. 4. Restricted Stock Units and Other Equity Awards...

  • Page 279
    ...accelerated basis as to that number of additional shares in which Employee would have otherwise been vested on the date of such separation from service had Employee completed an additional twelve (12) months of employment with the Company and had each applicable equity award been structured so as to...

  • Page 280
    ... the level at which the applicable performance goals for such fiscal year are in fact attained, had Employee continued in the Company's employ through the date that bonus award becomes due and payable by (B) a fraction the numerator of which is the number of whole months (rounded to the next highest...

  • Page 281
    ... longer period is required under applicable law) after the effective date of Employee's termination of employment, a comprehensive agreement releasing the Company and its officers, directors, employees, stockholders, subsidiaries, affiliates, representatives and other related parties from all claims...

  • Page 282
    ...applicable revocation period in effect for that Release. However, should such sixty (60)-day period span two taxable years, the first such monthly... term in the Company's 2010 Incentive Compensation Plan (or successor thereto), and a " Qualifying Change in Control" shall mean the date on which there ...

  • Page 283
    ... into account any Excise Tax imposed on the payments and benefits provided Employee hereunder (or on any other payments or benefits to which Employee may become entitled in connection with any change in control or ownership of the Company or the subsequent termination of Employee's employment with...

  • Page 284
    ... preceding thirty-six (36) months (or such shorter period of time in which Employee has actually been in employee status with the Company). Any such determination of Employee's separation from service shall, however, be made in accordance with the applicable standards of the Treasury Regulations...

  • Page 285
    ... this subparagraph (ii), the applicable dollar limitation will be equal to two times the lesser of (i) Employee's annualized compensation (based on Employee's annual rate of pay for the calendar year preceding the calendar year of Employee's separation from service, adjusted to reflect any increase...

  • Page 286
    ... Information and Inventions Agreement between Employee and the Company, any Company handbooks and policies in effect from time to time and the applicable stock plans and agreements evidencing the equity awards made to Employee from time to time during Employee's period of employment, contains...

  • Page 287
    ... hereto have executed this Agreement as of the date stated in the opening paragraph. /s/ Robert J. Taragan ROBERT J. TARAGAN Date signed: January 17, 2011 UNITED ONLINE, INC. By: /s/ Mark R. Goldston Mark R. Goldston Chairman, President and Chief Executive Officer Date signed: February 7, 2011 11

  • Page 288
    ... Company and report to the Chief Executive Officer of the Company. Employee agrees to devote Employee's full-time attention, skill and efforts to the performance of Employee's duties for the Company. 2. Salary and Benefits . (a) Employee will be paid a salary at Employee's current annualized rate...

  • Page 289
    ..., the Company at the time such bonus payment is paid. Employee's bonus payment for each fiscal year shall in no event be paid later than the 15th day of the third month following the end of the Company's fiscal year for which such bonus is earned. 4. Restricted Stock Units and Other Equity Awards...

  • Page 290
    ...accelerated basis as to that number of additional shares in which Employee would have otherwise been vested on the date of such separation from service had Employee completed an additional twelve (12) months of employment with the Company and had each applicable equity award been structured so as to...

  • Page 291
    ... the level at which the applicable performance goals for such fiscal year are in fact attained, had Employee continued in the Company's employ through the date that bonus award becomes due and payable by (B) a fraction the numerator of which is the number of whole months (rounded to the next highest...

  • Page 292
    ... longer period is required under applicable law) after the effective date of Employee's termination of employment, a comprehensive agreement releasing the Company and its officers, directors, employees, stockholders, subsidiaries, affiliates, representatives and other related parties from all claims...

  • Page 293
    that employment relationship and containing such other and additional terms as the Company deems satisfactory (the " Release ") and (ii) such Release must become effective and enforceable after the expiration of any applicable revocation period under federal or state law. Except as provided in the ...

  • Page 294
    ... into account any Excise Tax imposed on the payments and benefits provided Employee hereunder (or on any other payments or benefits to which Employee may become entitled in connection with any change in control or ownership of the Company or the subsequent termination of Employee's employment with...

  • Page 295
    ... preceding thirty-six (36) months (or such shorter period of time in which Employee has actually been in employee status with the Company). Any such determination of Employee's separation from service shall, however, be made in accordance with the applicable standards of the Treasury Regulations...

  • Page 296
    ... this subparagraph (ii), the applicable dollar limitation will be equal to two times the lesser of (i) Employee's annualized compensation (based on Employee's annual rate of pay for the calendar year preceding the calendar year of Employee's separation from service, adjusted to reflect any increase...

  • Page 297
    ...-Competition Agreement between Employee and the Company, any Company handbooks and policies in effect from time to time and the applicable stock plans and agreements evidencing the equity awards made to Employee from time to time during Employee's period of employment, contains all of the terms of...

  • Page 298
    ..., the parties hereto have executed this Agreement as of the date stated in the opening paragraph. /s/ Robert S. Apatoff ROBERT S. APATOFF Date signed: January 21, 2011 FTD GROUP, INC. By: /s/ Mark R. Goldston Mark R. Goldston Chairman and Chief Executive Officer Date signed: February 07, 2011 11

  • Page 299
    Exhibit 10.23 EMPLOYMENT AGREEMENT This Employment Agreement (the " Agreement ") is made and entered into effective the 7th day of February, 2011 (the " Effective Date ") by and between United Online, Inc. , a Delaware corporation (the " Company "), with principal corporate offices at 21301 Burbank ...

  • Page 300
    ..., the Company at the time such bonus payment is paid. Employee's bonus payment for each fiscal year shall in no event be paid later than the 15th day of the third month following the end of the Company's fiscal year for which such bonus is earned. 4. Restricted Stock Units and Other Equity Awards...

  • Page 301
    ...accelerated basis as to that number of additional shares in which Employee would have otherwise been vested on the date of such separation from service had Employee completed an additional twelve (12) months of employment with the Company and had each applicable equity award been structured so as to...

  • Page 302
    ... the level at which the applicable performance goals for such fiscal year are in fact attained, had Employee continued in the Company's employ through the date that bonus award becomes due and payable by (B) a fraction the numerator of which is the number of whole months (rounded to the next highest...

  • Page 303
    ... to the date in the subsequent fiscal year on which Employee's bonus for that fiscal year would have otherwise become due and payable on the basis of the applicable performance goals attained for that year had Employee continued in employment with the Company, then the Company will pay Employee an...

  • Page 304
    ...relating to Employee's employment with the Company and the termination of that employment relationship and containing such other and additional terms as the Company deems satisfactory (the " Release ") and (ii) such Release must become effective and enforceable after the expiration of any applicable...

  • Page 305
    ... into account any Excise Tax imposed on the payments and benefits provided Employee hereunder (or on any other payments or benefits to which Employee may become entitled in connection with any change in control or ownership of the Company or the subsequent termination of Employee's employment with...

  • Page 306
    ... preceding thirty-six (36) months (or such shorter period of time in which Employee has actually been in employee status with the Company). Any such determination of Employee's separation from service shall, however, be made in accordance with the applicable standards of the Treasury Regulations...

  • Page 307
    ... this subparagraph (ii), the applicable dollar limitation will be equal to two times the lesser of (i) Employee's annualized compensation (based on Employee's annual rate of pay for the calendar year preceding the calendar year of Employee's separation from service, adjusted to reflect any increase...

  • Page 308
    ... Information and Inventions Agreement between Employee and the Company, any Company handbooks and policies in effect from time to time and the applicable stock plans and agreements evidencing the equity awards made to Employee from time to time during Employee's period of employment, contains...

  • Page 309
    ... hereto have executed this Agreement as of the date stated in the opening paragraph. /s/ Charles B. Ammann CHARLES B. AMMANN Date signed: January 21, 2011 UNITED ONLINE, INC. By: /s/ Mark R. Goldston Mark R. Goldston Chairman, President and Chief Executive Officer Date signed: February 7, 2011 11

  • Page 310
    ...the Company and report to the Chief Executive Officer of the Company. Employee agrees to devote Employee's full-time attention, skill and efforts to the performance of Employee's duties for the Company. 2. Salary and Benefits . (a) Employee will be paid a salary at Employee's current annualized rate...

  • Page 311
    ... year shall in no event be paid later than the 15th day of the third month following the end of the Company's fiscal year for which such bonus is earned. 4. Restricted Stock Units and Other Equity Awards. (a) On February 15, 2011 (the " Grant Date "), Employee will be awarded restricted stock units...

  • Page 312
    ...accelerated basis as to that number of additional shares in which Employee would have otherwise been vested on the date of such separation from service had Employee completed an additional twelve (12) months of employment with the Company and had each applicable equity award been structured so as to...

  • Page 313
    ... such award provides otherwise or to the extent another issuance date may be required in order to comply with any applicable requirements of Section 409A of the Code. 5. Policies; Procedures; Proprietary Information and Inventions Agreement . As an employee of the Company, Employee will be expected...

  • Page 314
    ... the level at which the applicable performance goals for such fiscal year are in fact attained, had Employee continued in the Company's employ through the date that bonus award becomes due and payable by (B) a fraction the numerator of which is the number of whole months (rounded to the next highest...

  • Page 315
    ... longer period is required under applicable law) after the effective date of Employee's termination of employment, a comprehensive agreement releasing the Company and its officers, directors, employees, stockholders, subsidiaries, affiliates, representatives and other related parties from all claims...

  • Page 316
    ... Tax "), then the cash payments provided to Employee under this Agreement shall first be reduced, with each such payment to be reduced pro-rata but without any change in the payment date and with the monthly installments of the Separation Payment (or the lump sum Separation Payment in the event...

  • Page 317
    ... required to perform services at 333 Elliott Avenue West, Suite 500, Seattle, Washington 98119) without Employee's prior written consent; or any material un-waived breach by the Company of the terms of this Agreement; provided however, that with respect to any of the clause (i) - (iv) events above...

  • Page 318
    ...paid to Employee as they become due and payable under this Agreement. For purposes of this subparagraph (ii), the applicable dollar limitation will be equal to two times the lesser of (i) Employee's annualized compensation (based on Employee's annual rate of pay for the calendar year preceding the 9

  • Page 319
    ... offered by the Company; or (c) own any interest in, control, be employed by or associated with or render advisory, consulting or other services (including, but not limited to, services in research) to (i) any person or entity that engages in the design, development, manufacture, marketing or sale...

  • Page 320
    ... Information and Inventions Agreement between Employee and the Company, any Company handbooks and policies in effect from time to time and the applicable stock plans and agreements evidencing the equity awards made to Employee from time to time during Employee's period of employment, contains...

  • Page 321
    ... parties hereto have executed this Agreement as of the date stated in the opening paragraph. /s/ Harold Alan Zeitz Harold Alan Zeitz Date signed: January 13, 2011 CLASSMATES ONLINE, INC. By: /s/ Mark R. Goldston Mark R. Goldston Chairman and Chief Executive Officer Date signed: January 14, 2011 12

  • Page 322
    ... Internet Service) NetZero Modecom, Inc., a Delaware corporation (also dba UOL Modecom, Inc.) Opobox, Inc., a Delaware corporation StayFriends GmbH Trombi Acquisition SARL United Online Advertising Network, Inc., a Delaware corporation (dba United Online Media Group) United Online Web Services...

  • Page 323
    QuickLinks Exhibit 21.1 List of Subsidiaries

  • Page 324
    ... United Online, Inc. of our report dated February 25, 2011 relating to the financial statements, financial statement schedules and the effectiveness of internal control over financial reporting, which appears in this Form 10-K. /s/ PricewaterhouseCoopers LLP Los Angeles, California February 25, 2011

  • Page 325
    QuickLinks Exhibit 23.1 CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

  • Page 326
    ...31.1 CERTIFICATION OF CHIEF EXECUTIVE OFFICER PURSUANT TO SECURITIES EXCHANGE ACT RULES 13A-14 AND 15D-14 AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002 I, Mark R. Goldston, certify that: 1. I have reviewed this Annual Report on Form 10-K of United Online, Inc.; 2. Based on my...

  • Page 327
    QuickLinks Exhibit 31.1 CERTIFICATION OF CHIEF EXECUTIVE OFFICER PURSUANT TO SECURITIES EXCHANGE ACT RULES 13A-14 AND 15D-14 AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

  • Page 328
    ... 31.2 CERTIFICATION OF CHIEF FINANCIAL OFFICER PURSUANT TO SECURITIES EXCHANGE ACT RULES 13A-14 AND 15D-14 AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002 I, Scott H. Ray, certify that: 1. I have reviewed this Annual Report on Form 10-K of United Online, Inc.; 2. Based on my...

  • Page 329
    QuickLinks Exhibit 31.2 CERTIFICATION OF CHIEF FINANCIAL OFFICER PURSUANT TO SECURITIES EXCHANGE ACT RULES 13A-14 AND 15D-14 AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

  • Page 330
    ... The Annual Report on Form 10-K of United Online, Inc. for the year ended December 31, 2010, as filed with the Securities and Exchange Commission fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and The information contained in such report fairly...

  • Page 331
    QuickLinks Exhibit 32.1 CERTIFICATION OF CHIEF EXECUTIVE OFFICER PURSUANT TO 18 U.S.C. SECTION 1350 AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

  • Page 332
    ... The Annual Report on Form 10-K of United Online, Inc. for the year ended December 31, 2010, as filed with the Securities and Exchange Commission fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and The information contained in such report fairly...

  • Page 333
    QuickLinks Exhibit 32.2 CERTIFICATION OF CHIEF FINANCIAL OFFICER PURSUANT TO 18 U.S.C. SECTION 1350 AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002