Exhibit 10.1

 

Apatoff Employment Agreement

Execution Copy

 

EMPLOYMENT AGREEMENT

 

This Employment Agreement (the “Agreement”) is made and entered into as of the
Effective Date (as hereinafter defined) by and between FTD Companies, Inc., a
Delaware corporation (the “Company”), with principal corporate offices at 3113
Woodcreek Drive, Downers Grove, Illinois 60515, and Robert S. Apatoff, whose
address is 3113 Woodcreek Drive, Downers Grove, Illinois 60515 (“Employee”).

 

WHEREAS, Employee and the Company previously entered into an Employment
Agreement which was effective on the date on which the spin-off of the Company
from United Online, Inc. was consummated (the “2013 Agreement”).

 

WHEREAS, effective as of the date hereof, Employee and the Company now desire to
amend and restate the 2013 Agreement.

 

WHEREAS, Employee and the Company intend this Agreement to supersede and replace
the 2013 Agreement.

 

NOW THEREFORE, in consideration of the mutual covenants contained herein and
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto agree as follows:

 

1.                                      Term; Position.

 

(a)                                 The term of this Agreement will commence on
the Effective Date and extend through December 31, 2019, unless this Agreement
is earlier terminated as provided herein (the “Term”).  If the transactions
contemplated by the Purchase Agreement (as hereinafter defined) are not
consummated for any reason, this Agreement shall be deemed null and void and
shall terminate effective as of the termination of the Purchase Agreement, and
the 2013 Agreement shall continue with full force and effect.

 

(b)                                 Employee will serve as President and Chief
Executive Officer of the Company and report to the Board of Directors of the
Company. During the Term, Employee shall, unless he otherwise elects, be
nominated for election by the shareholders of the Company to the Board. 
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 an
annualized rate of $830,000 payable in successive bi-weekly or other
installments in accordance with the Company’s standard payroll practices for
salaried employees. Employee’s rate of salary will be subject to such increases
as may be determined from time to time by the Board of Directors. As used in
this Agreement, the term “Board of Directors” shall refer to the Board of
Directors of the Company or other governing body or committee to which the
authority of the Board of Directors of the Company with respect to executive
compensation matters has been delegated, including (without limitation) the
Compensation Committee of the Board of Directors of the Company.

 

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(b)                                 Employee will be eligible to participate in
each of the Company’s employee benefit plans that is made generally available
either to the Company’s employees or to the Company’s senior executives and for
which Employee satisfies the applicable eligibility requirements. Employee will
be entitled to a minimum of four (4) weeks of paid vacation each year or such
greater amount as determined in accordance with the Company’s standard vacation
policy.

 

(c)                                  The Company will promptly reimburse
Employee for all reasonable and necessary business expenses Employee incurs in
connection with the business of the Company and the performance of Employee’s
duties hereunder upon Employee’s submission of reasonable and timely
documentation of those expenses. In no event shall any expense be reimbursed
later than the end of the calendar year following the calendar year in which
that expense is incurred, and the amounts reimbursed in any one calendar year
shall not affect the amounts reimbursable in any other calendar year. 
Employee’s right to receive such reimbursements may not be exchanged or
liquidated for any other benefit.

 

3.                                      Bonus.

 

For each fiscal year of the Company during the Term of this Agreement, Employee
will be eligible to participate in a bonus program with a target bonus set by
the Board of Directors in an amount of up to 100% of Employee’s annual rate of
base salary.  The performance criteria for purposes of determining Employee’s
actual bonus for each fiscal year will be established by the Board of Directors,
and Employee’s annual bonus for one or more of those fiscal years may be
increased to include any additional amounts approved by the Board of Directors. 
Except as otherwise determined by the Board of Directors or set forth herein,
Employee will not be entitled to a bonus payment for any fiscal year unless
Employee is employed by, and in good standing with, 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.

 

(a)                                 If Employee’s employment is terminated by
the Company “without cause” or by Employee for “good reason” (as each term is
defined below) during the Term, then upon Employee’s satisfaction of the Release
Condition set forth in Section 7(b) below, any and all equity awards Employee
holds on the date of such termination (other than any equity award that
expressly provides for more favorable treatment) will vest on an accelerated
basis as to that number of additional shares in which Employee would have
otherwise been vested at the time of such termination had Employee completed an
additional twelve (12) months of employment with the Company and had each
applicable equity award been structured so as to vest in successive equal
monthly installments over the vesting schedule for that award..  In no event
will the number of additional shares which vest on such an accelerated basis
with respect to any particular equity award exceed the number of shares unvested
under that award immediately prior to the date of such termination. Except as
otherwise expressly provided in the agreement evidencing a particular restricted
stock unit or other equity award or to the extent another issuance date may be
required to comply with any applicable requirements of Section 409A of the
Internal Revenue Code of 1986, as amended (the “Code”), the shares of the common
stock of the Company (“Common Stock”) underlying the equity awards that vest on
an accelerated basis in accordance with this Section 4(a) will be issued to
Employee within the sixty (60)-day period following the date of Employee’s
“separation from service” (as defined below) as a result of Employee’s
termination “without cause” (as defined below) or Employee’s resignation for
“good reason” (as defined below), provided the Release required of Employee
pursuant to Section 7(b) has become effective and enforceable in accordance with
its terms following the expiration of the applicable revocation period in effect
for that Release.  However, should such sixty (60)-day period span two taxable
years, the issuance shall be effected during the portion of that period that
occurs in the second taxable year.

 

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(b)                                 If Employee’s employment is terminated by
the Company “without cause” or by Employee for “good reason” (as each term is
defined below) at any time during the Term and within the period commencing with
the execution by the Company of a definitive agreement for a Change in Control
(as defined below) and ending with the earlier of (i) the termination of that
agreement without the consummation of such Change in Control or (ii) the
expiration of the twenty-four (24)-month period measured from the date such
Change in Control occurs (except for a Change in Control which occurs pursuant
to clause (i) of the proviso included in the definition of “Change in Control”
in Section 7(b) of this Agreement, in which case, the expiration of the
thirty-six (36) month period measured from the date of such Change in Control)
(the “Change in Control Protected Period”), then upon Employee’s satisfaction of
the Release Condition set forth in Section 7(b) below, any and all equity awards
Employee holds on the date of such termination will fully vest on an accelerated
basis with respect to all non-vested shares of Common Stock at the time subject
to those awards, except to the extent that more favorable treatment is otherwise
provided in the equity award agreement.  Except as otherwise expressly provided
in the agreement evidencing a particular restricted stock unit or other equity
award or to the extent another issuance date may be required in order to comply
with any applicable requirements of Section 409A of the Code, the shares of
Common Stock (or any replacement securities) underlying the equity awards that
fully vest on an accelerated basis in accordance with this Section 4(b), or the
proceeds of any cash retention program established in replacement of those
shares pursuant to the terms of the applicable award agreement, will be issued
or distributed to Employee within the sixty (60)-day period following the date
of Employee’s “separation from service” (as defined below) as a result of
Employee’s termination “without cause” (as defined below) or Employee’s
resignation for “good reason” (as defined below), provided the Release required
of Employee pursuant to Section 7(b) has become effective and enforceable in
accordance with its terms following the expiration of the applicable revocation
period in effect for that Release.  However, should such sixty (60)-day period
span two taxable years, the issuance shall be effected during the portion of
that period that occurs in the second taxable year.

 

(c)                                  Upon Employee’s “separation from service”
(as defined below) as a result of Employee’s death or Disability (as defined
below), any and all equity awards Employee holds on the date of such separation
from service will vest on an 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 vest in successive equal monthly installments over the
vesting schedule for that award. Except as otherwise expressly provided in the
agreement evidencing a particular restricted stock unit or other equity award or
to the extent another issuance date may be required in order to comply with any
applicable requirements of Section 409A of the Code, the shares of Common Stock
underlying the equity awards that vest on an accelerated basis in accordance
with this Section 4(c) will be issued on the date of such separation from
service or as soon as administratively practicable thereafter, but in no event
later than the later of (i) the end of the calendar year in which such
separation from service occurs or (ii) the 15th day of the third calendar month
following the date of such separation from service. For purposes of this
Agreement, “Disability” means Employee’s inability to engage in any substantial
activity necessary to perform Employee’s duties and responsibilities hereunder
by reason of any medically determinable physical or mental impairment which can
be expected to result in death or which has lasted, or can be expected to last,
for a continuous period of not less than twelve (12) months.

 

(d)                                 The vesting acceleration provisions of this
Section 4 and Section 7 will apply to all outstanding equity awards held by
Employee on the Effective Date, unless the agreements evidencing those awards
provide for more favorable acceleration, and those agreements, to the extent
they provide for a lesser amount of acceleration, are hereby amended to
incorporate the acceleration provisions of Section 4 and Section 7 of this
Agreement for the period this Agreement remains in effect, and such vesting
acceleration provisions will also apply to equity awards made after the
Effective Date of this Agreement unless the agreements evidencing these awards
provide for more favorable acceleration.  The

 

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shares subject to each equity award that vests pursuant to the vesting
acceleration provisions of this Section 4 shall be issued in accordance with the
applicable issuance date provisions of this Section 4, except to the extent the
agreement evidencing 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.

 

As an employee of the Company, Employee will be expected to abide by all of the
Company’s policies and procedures, including (without limitation) the terms of
any Company handbook, insider trading policy and code of ethics in effect from
time to time.

 

6.                                      At Will Employment.

 

Notwithstanding anything to the contrary contained herein, Employee’s employment
with the Company is “at will” and will not be for any specified term, meaning
that either Employee or the Company will be entitled to terminate Employee’s
employment at any time and for any reason, with or without cause or advance
notice.  Any contrary representations that may have been made to Employee are
hereby superseded by the terms set forth in this Agreement.  This is the full
and complete agreement between Employee and the Company on this subject.
Although Employee’s job duties, title, compensation and benefits, as well as the
Company’s personnel policies and procedures, may change from time to time, the
“at will” nature of Employee’s employment may only be changed in an express
written agreement signed by Employee and the Chairman of the Board and approved
by the Board of Directors.

 

7.                                      Separation from Service.

 

(a)                                 Termination by Employee.  If Employee
terminates his or her employment with the Company for any reason other than as a
result of his or her death or Disability or his or her resignation for “good
reason” (as defined below), then all the obligations of the Company set forth in
this Agreement will cease, other than the obligation to pay Employee, on his or
her employment termination date, any earned but unpaid compensation for services
rendered through that termination date and any accrued but unused vacation days
as of that termination date (collectively, the “Accrued Obligations”).  If
Employee terminates his or her employment with the Company for “good reason” (as
defined below) during the Term, then in addition to Employee’s right to receive
the Accrued Obligations, Employee will, upon Employee’s satisfaction of the
Release Condition set forth in Section 7(b) below, become entitled to the
Separation Payment (as defined below) and the Additional Payments (as defined
below), to the same extent as if Employee’s employment had been terminated by
the Company “without cause” (as defined below) during the Term, and Employee
will also be entitled, in accordance with the applicable provisions of Section 4
above, to the accelerated vesting of any equity awards Employee holds at the
time of such termination. Following Employee’s termination of his or her
employment with the Company under this Section 7(a), Employee will continue to
be obligated to comply with the terms of Section 9 below.

 

(b)                                 Termination by the Company.  If Employee’s
employment is terminated by the Company “without cause” (as defined below)
during the Term, then in addition to Employee’s right to receive the Accrued
Obligations, Employee will, upon Employee’s satisfaction of the Release
Condition set forth below in this Section 7(b), become entitled to a cash
separation payment (the “Separation Payment”) in an aggregate amount equal to
the sum of (i) two (2) times the base salary at the annual rate in effect for
Employee at the time and (ii) two (2) times the Employee’s target bonus for the
fiscal year in which the Employee’s employment is terminated.  In addition,
contingent upon Employee’s satisfaction of the Release Condition, Employee will
be eligible for the following additional separation payments (the “Additional
Payments”):

 

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(I)                                   Employee will be eligible for an
additional separation payment in an amount equal to a pro-rated bonus for the
fiscal year in which such involuntary termination occurs. Such pro-rated bonus
will be determined by multiplying (A) the actual bonus (if any) Employee would
have earned for that fiscal year, based on 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 whole month) Employee remained in the
Company’s employ during that fiscal year and the denominator of which is twelve
(12), with such pro-rated bonus (if any) to be paid at the same time and in same
form that the bonus payment for such fiscal year would have been made following
the completion of that fiscal year had Employee remained in the Company’s employ
through the payment date.  However, if the termination occurs within the Change
in Control Protected Period, Employee will be eligible for a pro-rated bonus
determined by (1) multiplying (A) Employee’s target bonus for that fiscal year
by (B) a fraction the numerator of which is the number of whole months (rounded
to the next highest whole month) Employee remained in the Company’s employ
during that fiscal year and the denominator of which is twelve (12) and
(2) reducing such amount by any bonus earned by Employee for the same fiscal
year under Section 3 of this Agreement, with such pro-rated bonus to be paid (in
the same form in which the bonus payment for such fiscal year would have been
paid had Employee remained in the Company’s employ through the payment date) as
follows:

 

(ii)                                  if such Change in Control occurs on or
before the date of such involuntary termination, then such payment shall be made
on the date on which the first monthly installment of the Separation Payment
(or, in the case of a termination following a Qualifying Change in Control (as
defined below), the lump sum Separation Payment) is paid; or

 

(iii)                               if such Change in Control occurs after the
date of such involuntary termination, then such payment shall be made on the
later of (x) the third (3rd) business day following the effective date of such
Change in Control or (y) the sixtieth (60th) day following the date of
Employee’s separation from service (as defined below) or, if such sixtieth
(60th) day is not otherwise a business day, then the immediately preceding
business day.

 

(II)                              In addition, if the date of such involuntary
termination occurs after the end of a fiscal year of the Company but prior 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 additional separation
payment equal to the bonus that Employee would have received on the basis of the
attained performance goals had Employee remained employed by, and in good
standing with, the Company through the payment date for such bonus, with that
amount to be paid in a lump sum (in the same form in which such bonus payment
would have been paid had Employee remained in the Company’s employ through the
payment date) on the later of (i) the date on which the first monthly
installment of the Separation Payment (or, in the case of a termination
following a Qualifying Change in Control, the lump sum Separation Payment) is
paid to Employee as set forth below in this Section 7(b) or (ii) the date such
bonus would have been paid to

 

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Employee pursuant to Section 3 of this Agreement had Employee continued in the
Company’s employ through such payment date.

 

(III)                         In no event shall any such Additional Payment
described in (I) and (II) above be made later than the last day of the
applicable period necessary to qualify such Additional Payment for the
short-term deferral exception under Code Section 409A.

 

(IV)                          For a period of twelve (12) months following the
date of termination, if Employee elects COBRA health care continuation coverage,
Employee shall be eligible to continue to receive the medical and dental
coverage provided by the Company as of the date of termination (or generally
comparable coverage) for himself and, where applicable his spouse and
dependents, as the same may be changed from time to time for employees of the
Company generally provided; that in order to receive such continued coverage,
Employee shall be required to pay to the Company the full amount of the monthly
premium payments for such coverage, at the time such payments are due, and the
Company shall, on the first payroll of the month following the payment of each
such premium, reimburse Employee for an amount that, prior to withholding for
applicable taxes, is equal to the amount of such monthly premium.

 

Payment of the Separation Payment and the Additional Payments (if any) and the
accelerated vesting of Employee’s equity awards under Section 4 will each be
contingent upon the satisfaction of the following requirements (collectively the
“Release Condition”): (i) Employee must execute and deliver to the Company,
within twenty-one (21) days (or forty-five (45) days to the extent such 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 that Employee may have
with respect to such parties 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 revocation period under federal or state law.

 

Except as provided in the following paragraph, the Separation Payment to which
Employee becomes entitled under this Section 7(b) or under Section 7(a) above
will be payable in a series of twelve (12) successive equal monthly
installments, beginning on the first regular payday for the Company’s salaried
employees, within the sixty (60)-day period following the date of Employee’s
“separation from service” (as defined below) as a result of Employee’s
termination “without cause” (as defined below) or Employee’s resignation for
“good reason” (as defined below), on which Employee’s executed Release is
effective and enforceable in accordance with its terms following the expiration
of the applicable revocation period in effect for that Release.  However, should
such sixty (60)-day period span two taxable years, the first such monthly
installment shall be paid during the portion of that period that occurs in the
second taxable year.  The remaining monthly installments shall be paid on
successive monthly anniversaries of the initial monthly installment hereunder. 
For purposes of Section 409A of the Code, Employee’s right to receive such
Separation Payment shall be deemed a right to receive a series of separate
individual payments and not a right to single payment.

 

If Employee’s employment is terminated by the Company “without cause” (as
defined below) or if Employee terminates his or her employment with the Company
for “good reason” (as defined below) during the Term and within the twenty-four
(24) month period beginning on the effective date of a Qualifying Change in
Control (as defined below), the Separation Payment to which Employee becomes
entitled under this Section 7(b) or under Section 7(a) above upon Employee’s
satisfaction of the Release Condition will be payable in a single lump-sum
payment on the first regular payday for the Company’s

 

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salaried employees, within the sixty (60)-day period following the date of
Employee’s “separation from service” (as defined below) as a result of
Employee’s termination “without cause” (as defined below) or Employee’s
resignation for “good reason” (as defined below), on which Employee’s executed
Release is effective and enforceable in accordance with its terms following the
expiration of the applicable revocation period in effect for that Release.
However, should such sixty (60)-day period span two taxable years, then such
payment shall be made during the portion of that period that occurs in the
second taxable year. Any Separation Payment to which Employee becomes entitled
hereunder in connection with a termination following a Change in Control other
than a Qualifying Change in Control will be paid in installments as set forth in
the immediately preceding paragraph of this Section 7(b).  For purposes of this
Agreement, a “Change in Control” shall have the meaning assigned to such term in
the Company’s most recently-adopted equity compensation plan; provided, however,
that a Change in Control also shall include each occurrence of
(i) the consummation of the transaction contemplated by the Purchase Agreement,
(ii)  the consummation of any subsequent transaction in which Liberty
Interactive Corporation for the first time increases its beneficial ownership to
securities possessing more than fifty percent (50%) (or such lesser percentage
as may apply at such time under such equity compensation plan or outstanding
award thereunder) of the total combined voting power of the Company’s
outstanding securities and (iii) any sale (including, without limitation, any
transfer or other disposition) by Liberty Interactive Corporation of all or part
of its interest in securities of the Company in a single transaction (or in a
series of related transactions) to any “person” not “affiliated” (within the
meaning of such terms under Rule 12b-2 under the Securities Exchange Act of
1934) with Liberty Interactive Corporation which results in such person having
beneficial ownership to securities possessing at least twenty percent (20%) of
the total combined voting power of the Company’s outstanding securities, and a
“Qualifying Change in Control” shall mean the date on which there occurs a
“Change in Control” (as defined above) that also qualifies as: (i) a change in
the ownership of the Company, as determined in accordance with
Section 1.409A-3(i)(5)(v) of the Treasury Regulations, (ii) a change in the
effective control of the Company, as determined in accordance with
Section 1.409A-3(i)(5)(vi) of the Treasury Regulations, or (iii) a change in the
ownership of a substantial portion of the assets of the Company, as determined
in accordance with Section 1.409A-3(i)(5)(vii) of the Treasury Regulations.  For
the avoidance of doubt, the Spin-Off shall not constitute a Change in Control or
a Qualifying Change in Control for purposes of the Agreement.

 

If Employee’s employment is terminated by the Company “without cause” (as
defined below), the Company will have no further obligation to Employee pursuant
to this Agreement other than the Accrued Obligations, the vesting of Employee’s
outstanding equity awards in accordance with the applicable vesting acceleration
provisions of Section 4 above and the obligations of the Company pursuant to
this Section 7(b).

 

If Employee’s employment is terminated by the Company “with cause” (as defined
below), the Company will have no further obligation to Employee under the terms
of this Agreement, other than the Accrued Obligations.

 

Notwithstanding the termination of Employee’s employment by the Company “with
cause” or “without cause,” or by Employee for “good reason” or without “good
reason”, Employee will continue to be subject to the restrictive covenants set
forth in Section 9, whether or not Employee becomes entitled to any severance or
separation payments or benefits pursuant to Section 4 or Section 7 of this
Agreement.

 

If any payment or benefit received or to be received by Employee (including any
payment or benefit received pursuant to this Agreement or otherwise) would be
(in whole or part) subject to the excise tax imposed by Section 4999 of the
Code, or any successor provision thereto, or any similar tax imposed by state or
local law, or any interest or penalties with respect to such excise tax (such
tax or taxes, together with any such interest and penalties, are hereafter
collectively referred to as the “Excise Tax”), then the cash payments provided
to Employee under this Agreement shall first be reduced, with each such

 

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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 of a Qualifying Change in Control) to be the
first such cash payments so reduced, and then, if necessary, the accelerated
vesting of Employee’s equity awards pursuant to the provisions of this Agreement
shall be reduced in the same chronological order in which those awards were
made, but only to the extent necessary to assure that Employee receives only the
greater of (i) the amount of those payments and benefits which would not
constitute a parachute payment under Code Section 280G or (ii) the amount which
yields Employee the greatest after-tax amount of benefits after taking 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 the Company).

 

(c)                                  Termination by Death or Disability.

 

If Employee incurs a “separation from service” (as defined below) as a result of
his or her death or Disability, the Company will be obligated to pay the Accrued
Obligations to Employee, Employee’s estate or beneficiaries (as the case may be)
on the date of such separation from service or as soon as administratively
practicable thereafter, but in no event later than sixty (60) days after the
date of such separation from service.  In the event of such separation from
service due to Employee’s death or Disability, Employee or Employee’s estate or
beneficiaries, as the case may be, will also be entitled to the accelerated
vesting of Employee’s equity awards as set forth in Section 4(c) above.  The
provisions of this Section 7(c) will not affect or change the rights or benefits
to which Employee is otherwise entitled under the Company’s employee benefit
plans or otherwise.

 

(d)                                 Definitions.

 

For purposes of this Agreement, the following definitions will be in effect:

 

“Effective Date” means the closing of the transaction contemplated by the
Purchase Agreement.

 

“good reason” means:

 

(i)                                     a material reduction in either
Employee’s base salary or annual bonus opportunity, in either case without
Employee’s prior written consent;

 

(ii)                                  a material reduction in Employee’s
authority, duties or responsibilities (including reporting responsibilities),
without Employee’s prior written consent, which material reduction shall be
presumed to have occurred if the Company is no longer publicly traded by reason
of being acquired by a publicly traded company or if Employee is no longer
reporting to the Board of Directors;

 

(iii)                               a material change in the geographic location
at which Employee must perform services (the parties acknowledge that Employee
is currently required to perform services at 3113 Woodcreek Drive, Downers
Grove, Illinois 60515) without Employee’s prior written consent;

 

(iv)                              a failure to re-nominate Employee as a
director at the next time his term on the Board expires; or

 

(v)                                 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) — (v) events above, Employee will not

 

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be deemed to have resigned for good reason unless (A) Employee provides written
notice to the Company of the existence of the good reason event within ninety
(90) days after its initial occurrence, (B) the Company is provided with thirty
(30) days after receipt of such notice in which to cure such good reason event
and (C) Employee effectively terminates Employee’s employment within one hundred
eighty (180) days following the occurrence of the non-cured clause (i) —
(v) event.

 

“Purchase Agreement “ means the Stock Purchase Agreement dated as of July 30,
2014, by and among FTD Companies, Inc., Liberty Interactive Corporation and
Provide Commerce, Inc..

 

“separation from service” means Employee’s cessation of employee status with the
Company by reason of Employee’s death, resignation, dismissal or other
termination event and shall be deemed to occur at such time as the level of bona
fide services Employee is to render as such an employee (or as a non-employee
consultant) permanently decreases to a level that is not more than twenty
percent (20%) of the average level of services Employee rendered as an employee
during the immediately 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 issued under Section 409A of the Code.

 

“with cause” means Employee’s termination of employment by the Company for any
of the following reasons:

 

(i)                                     if Employee is convicted of, or enters a
plea of nolo contendere to, a felony or a misdemeanor involving any act of moral
turpitude;

 

(ii)                                  if Employee commits an act of actual
fraud, embezzlement, theft or similar dishonesty against the Company or any of
its subsidiaries or affiliates;

 

(iii)                               if Employee commits any willful misconduct
or gross negligence resulting in material harm to the Company or any of its
subsidiaries or affiliates; or

 

(iv)                              if Employee fails, after receipt of detailed
written notice and after receiving a period of at least thirty (30) days
following such notice to cure such failure, to use his or her reasonable good
faith efforts to follow the reasonable and lawful direction of the Board of
Directors and to perform his or her obligations hereunder.

 

“without cause” means any reason not within the scope of the definition of the
term “with cause.”

 

(e)                                  Code Section 409A Deferral Period. 
Notwithstanding any provision in this Agreement to the contrary (other than
Section 7(f) below), no payment or distribution under this Agreement which
constitutes an item of deferred compensation under Section 409A of the Code and
becomes payable by reason of Employee’s termination of employment with the
Company will be made to Employee until Employee incurs a separation from service
(as such term is defined above and determined in accordance with Treasury
Regulations issued under Section 409A of the Code) in connection with such
termination of employment.  For purposes of this Agreement, each amount to be
paid or benefit to be provided Employee shall be treated as a separate
identified payment or benefit for purposes of Section 409A of the Code.  In
addition, no payment or benefit which constitutes an item of deferred
compensation under

 

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Section 409A of the Code and becomes payable by reason of Employee’s separation
from service will be made to Employee prior to the earlier of (i) the first day
of the seventh (7th) month measured from the date of such separation from
service or (ii) the date of Employee’s death, if Employee is deemed at the time
of such separation from service to be a “specified employee” (as determined
pursuant to Code Section 409A and the Treasury Regulations thereunder) and such
delayed commencement is otherwise required in order to avoid a prohibited
distribution under Code Section 409A(a)(2).  Upon the expiration of the
applicable deferral period, all payments and benefits deferred pursuant to this
Section 7(e) (whether they would have otherwise been payable in a single sum or
in installments in the absence of such deferral) shall be paid or 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
month immediately following the date the Company receives proof of Employee’s
death.  Any remaining payments or benefits due under this Agreement will be paid
in accordance with the normal payment dates specified herein.

 

(f)                                   Provisions Applicable to “Specified
Employee”.  Notwithstanding Section 7(e) above, the following provisions shall
also be applicable to Employee if Employee is a “specified employee” at the time
of Employee’s separation of service:

 

(i)                                     Any payments or benefits which become
due and payable to Employee during the period beginning with the date of
Employee’s separation from service and ending on March 15 of the following
calendar year and otherwise qualify for the short-term deferral exception to
Code Section 409A shall not be subject to the holdback provisions of
Section 7(e) and shall accordingly be paid as and when they become due and
payable under this Agreement in accordance with such short-term deferral
exception to Code Section 409A.

 

(ii)                                  The remaining portion of the payments and
benefits to which Employee becomes entitled under this Agreement, to the extent
they do not in the aggregate exceed the dollar limit described below and are
otherwise scheduled to be paid no later than the last day of the second calendar
year following the calendar year in which Employee’s separation from service
occurs, shall not be subject to the holdback provisions of Section 7(e) and
shall be 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 calendar
year of Employee’s separation from service, adjusted to reflect any increase
during that calendar year which was expected to continue indefinitely had such
separation from service not occurred) or (ii) the compensation limit under
Section 401(a)(17) of the Code as in effect in the year of such separation from
service.  To the extent the portion of the severance payments and benefits to
which Employee would otherwise be entitled under this Agreement during the
deferral period under Section 7(e) exceeds the foregoing dollar limitation, such
excess shall be paid in a lump sum upon the expiration of that deferral period,
in accordance with the deferred payment provisions of Section 7(e), and the
remaining severance payments and benefits (if any) shall be paid in accordance
with the normal payment dates specified for them herein.

 

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8.                                      Withholding Taxes.

 

All forms of compensation payable pursuant to the terms this Agreement, whether
payable in cash, shares of Common Stock or other property, are subject to
reduction to reflect the applicable withholding and payroll taxes.

 

9.                                      Restrictive Covenants.

 

Until one (1) year after the termination of Employee’s employment with the
Company, Employee will not, directly or indirectly, solicit or recruit for
employment, any person or persons who are employed by Company or any of its
subsidiaries or affiliates, or who were so employed at any time within a period
of twelve (12) months immediately prior to the date Employee’s employment
terminated, or otherwise interfere with the relationship between any such person
and the Company; nor will Employee assist anyone else in recruiting any such
employee to work for another company or business or discuss with any such person
his or her leaving the employ of the Company or engaging in a business activity
in competition with the Company.  Notwithstanding the foregoing, if Employee and
the Company enter into any restrictive covenant agreement, the terms of which
conflict with this Section 9, the terms of such agreement shall govern. 
Employee hereby acknowledges that Employee has entered into a Confidentiality
and Non-Competition Agreement and an Employee Proprietary Information and
Inventions Agreement with the Company on or prior to the Effective Date.

 

10.                               Deferred Compensation Programs

 

Any compensation deferred by Employee pursuant to one or more non-qualified
deferred compensation plans or arrangements of the Company subject to
Section 409A of the Code and not otherwise expressly addressed by the terms of
this Agreement, shall be paid at such time and in such form of payment as set
forth in each applicable plan or arrangement governing the payment of any such
deferred amounts.

 

11.                               Clawback.

 

Any amounts paid or payable to Employee pursuant to this Agreement or the
Company’s equity or compensation plans shall be subject to recovery or clawback
to the extent required by any applicable law or any applicable securities
exchange listing standards.

 

12.                               Entire Agreement/Construction of Terms.

 

(a)                                 This Agreement, together with 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, will, as of the Effective Date,
(i) contain all of the terms of Employee’s employment with the Company and
(ii) supersede any prior understandings or agreements, whether oral or written,
between Employee and the Company, including but not limited to the 2013
Agreement, which 2013 Agreement shall terminate as of the Effective Date and be
of no further force or effect.

 

(b)                                 If any provision of this Agreement is held
by an arbitrator or a court of competent jurisdiction to conflict with any
federal, state or local law, or to be otherwise invalid or unenforceable, such
provision shall be construed or modified in a manner so as to maximize its
enforceability while giving the greatest effect as possible to the intent of the
parties.  To the extent any provision cannot be construed or modified to be
enforceable, such provision will be deemed to be eliminated from this

 

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Agreement and of no force or effect, and the remainder of this Agreement will
otherwise remain in full force and effect and be construed as if such portion
had not been included in this Agreement.

 

(c)                                  This Agreement is not assignable by
Employee.  This Agreement may be assigned by the Company to its subsidiaries or
affiliates or to successors in interest to the Company or its lines of business.

 

(d)                                 The severance payments and benefits under
this Agreement are intended, where possible, to comply with the “short term
deferral exception” and the “involuntary separation pay exception” to Code
Section 409A.  Accordingly, the provisions of this Agreement applicable to the
Separation Payment and the accelerated vesting of Employee’s equity awards and
the issuance of shares of Common Stock thereunder and the determination of
Employee’s separation from service due to termination of Employee’s employment
without cause or Employee’s resignation for good reason shall be applied,
construed and administered so that those payments and benefits qualify for one
or both of those exceptions, to the maximum extent allowable. However, to the
extent any payment or benefit to which Employee becomes entitled under this
Agreement is deemed to constitute an item of deferred compensation subject to
the requirements of Code Section 409A, the provisions of this Agreement
applicable to that payment or benefit shall be applied, construed and
administered so that such payment or benefit is made or provided in compliance
with the applicable requirements of Code Section 409A.  In addition, should
there arise any ambiguity as to whether any other provisions of this Agreement
would contravene one or more applicable requirements or limitations of Code
Section 409A and the Treasury Regulations thereunder, such provisions shall be
interpreted, administered and applied in a manner that complies with the
applicable requirements of Code Section 409A and the Treasury Regulations
thereunder.

 

13.                               Amendment and Governing Law.

 

This Agreement may not be amended or modified except by an express written
agreement sign by Employee and the Chairman of the Board of Directors and
approved by the Board of Directors.  Employee agrees that any dispute in the
meaning, effect or validity of this Agreement shall be resolved in accordance
with the laws of the State of Illinois without regard to the conflict of laws
provisions thereof.  Employee hereby irrevocably submits to the jurisdiction
(including without limitation in personam jurisdiction), process and venue of
the courts of the State of Illinois and the Federal courts of the United States
located in Chicago, Illinois, and hereby agrees that any action, suit or
proceeding initiated by Illinois for the interpretation or enforcement of the
provisions of this Agreement shall, and that any action, suit or proceeding
initiated by Company for the interpretation or enforcement of the provisions of
this Agreement may, be heard and determined exclusively in a Federal court, or,
if not permitted by applicable law, then in a State court, situated in
Chicago, Illinois.

 

14.                               Surviving Provisions.

 

Following any termination or expiration of this Agreement, Sections 5, 6, 7(e),
7(f), 8, 9, 10, 11, 12, 13 and 14 will survive, and, if Employee’s employment
with the Company continues thereafter, Employee’s employment with the Company
will continue to be “at will”.

 

[SIGNATURE PAGE FOLLOWS]

 

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date set forth below.

 

/s/ Robert S. Apatoff

 

Robert S. Apatoff

 

 

 

Date signed:    July 28, 2014

 

 

 

 

 

FTD COMPANIES, INC.

 

 

 

 

By:

/s/ Scott D. Levin

 

 

 

 

Name:

Scott D. Levin

 

 

 

 

Title:

Executive Vice President and General Counsel

 

 

 

Date signed:    July 28, 2014

 

 

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