Exhibit 10.1


 


NON-EMPLOYEE DIRECTORS-INITIAL
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, non-employee Board members and other independent advisors who
provide services to the Corporation (or any Parent or Subsidiary).


 


B.            Participant is a member of
the Board, and this Agreement is executed pursuant to, and is intended to carry
out the purposes of, the Plan in providing a meaningful incentive for the
Participant to continue to serve as a Board member.


 


C.            All capitalized terms in
this Agreement shall have the meaning assigned to them in the attached Appendix A.


 


NOW, THEREFORE, it is hereby agreed as follows:


 


1.             Grant
of 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
of shares of Common Stock subject to the awarded Restricted Stock Units, the
applicable vesting schedule for those shares, the dates on which those vested
shares shall become issuable to Participant and the remaining terms and
conditions governing the award (the “Award”) shall be as set forth in this
Agreement.


 


AWARD SUMMARY


 


Award Date:                          <Award Date>


 


Number
of Shares

Subject to Award:                <# of Shares
Awarded> shares of Common Stock (the “Shares”)


 


Vesting Schedule:                The Shares
shall vest in a series of three (3) successive equal annual installments
upon Participant’s completion of each year of service as a Board member over
the three (3)-year period measured from the Award Date. Such vesting schedule
is hereby designated the “Normal Vesting Schedule” for such Shares. Should any
scheduled vesting date under the Normal Vesting Schedule otherwise occur on a
date on which the Common Stock is not traded on the Stock Exchange serving as
the primary market for the Common Stock, then that vesting date shall instead
be deemed to occur on the last day prior to such scheduled vesting date on
which the Common Stock is so traded. The Shares shall also be subject to
accelerated vesting in whole or in part in accordance with the provisions of
Paragraphs 4 and 6 of this Agreement.


 

















 


Issuance Schedule               Each Share in which the
Participant vests in accordance with the foregoing vesting provisions shall be
issued in compliance with the short-term deferral exception to Section 409A
of the Code. Accordingly, each Share in which the Participant vests in
accordance with the Normal Vesting Schedule shall be issued on the applicable
vesting date for that Share or as soon thereafter as administratively
practicable, but in no event later than the close of the calendar year in which
that vesting date occurs or (if later) the fifteenth day of the third calendar
month following such vesting date. The Shares which vest pursuant to Paragraph
4 or Paragraph 6 of this Agreement shall be issued in accordance with the
provisions of the applicable Paragraph. The date on which each Share is to be
issued in accordance with the foregoing is hereby designated the “Issuance
Date” for that Share.


 


2.             Limited
Transferability.  Prior to
actual receipt of the Shares which vest hereunder, the Participant may not
transfer any interest in the Award or the underlying Shares. Any Shares which
vest hereunder but which otherwise remain unissued at the time of the
Participant’s death may be transferred pursuant to the provisions of the
Participant’s will or the laws of inheritance or to the Participant’s
designated beneficiary or beneficiaries of this Award. The Participant may also
direct the Corporation to re-issue the stock certificates for any Shares which
in fact vest and become issuable under the Award during his or her lifetime to
one or more designated family members or a trust established for the
Participant and/or his or her family members. The Participant may make such a
beneficiary designation or certificate directive at any time by filing the
appropriate form with the Plan Administrator or its designee.


 


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 those unvested Shares, and the Participant shall
thereupon cease to have any right or entitlement to receive any Shares under
those cancelled units.


 


4.             Accelerated
Vesting.


 


(a)           Should the Participant cease to serve as a Board
member by reason of death or Permanent Disability, then all the Shares at the
time subject to this Award shall immediately vest in full.


 


(b)           The Shares to which the Participant becomes entitled
pursuant to the vesting provisions of Paragraph 4(a) shall be issued on
the date the Participant ceases to serve as a Board member or as soon as
administratively practicable thereafter, but in no event later than the close
of the calendar year in which the Participant ceases to serve as a Board member
or (if later) the fifteenth (15th) day of the third (3rd) calendar month
following the date the Participant ceases to serve as a Board member.


 


5.             Stockholder
Rights and Dividend Equivalents


 


(a)           The holder of this Award
shall not have any stockholder rights, including voting or dividend rights,
with respect to the Shares subject to the Award until the Participant becomes
the record holder of those Shares following their actual issuance.


 


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(b)           Notwithstanding the
foregoing, should any dividend or other distribution, whether regular or
extraordinary, payable in cash or other property (other than shares of Common
Stock) be declared and paid on the outstanding Common Stock while one or more
Shares remain subject to this Award (i.e., those Shares are not otherwise
issued and outstanding for purposes of entitlement to the dividend or
distribution), then the following provisions shall govern the Participant’s
interest in that dividend or distribution:


 


(i)            If the dividend is a regularly-scheduled cash
dividend on the Common Stock, then the Participant shall be entitled to a
current cash distribution from the Corporation equal to the cash dividend the
Participant would have received with respect to the Shares at the time subject
to this Award had those Shares actually been issued and outstanding and
entitled to that cash dividend. Each cash dividend 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.


 


(ii)           For any other dividend or distribution, a special
book account shall be established for the Participant and credited with a
phantom dividend equivalent to the actual dividend or distribution which would
have been paid on the Shares at the time subject to this Award had they been
issued and outstanding and entitled to that dividend or distribution.  As the Shares subsequently vest hereunder, the
phantom dividend equivalents so credited to those Shares in the book account
shall also vest, and those vested dividend equivalents shall be distributed to
the Participant (in the same form the actual dividend or distribution was paid
to the holders of the Common Stock entitled to that dividend or distribution)
concurrently with the issuance of the vested Shares to which those phantom
dividend equivalents relate.  In no event,
however, shall any such phantom dividend equivalents vest or become
distributable unless the Shares to which they relate vest in accordance with
the terms of this Agreement.


 


6.             Change
in Control.  Any
Restricted Stock Units subject to this Award at the time of a Change in Control
shall vest in full immediately prior to the consummation of that Change in
Control.  The Shares subject to those
vested units shall be converted into the right to receive for each such Share
the same consideration per share of Common Stock payable to the other stockholders
of the Corporation in consummation of that Change in Control, and such
consideration shall be distributed to Participant on the effective date of such
Change in Control or as soon as administratively practicable thereafter, but in
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 the outstanding Common Stock as a class
without the Corporation’s receipt of consideration, or should the value of the
outstanding shares of Common Stock be substantially reduced as a result of a
spin-off transaction or an extraordinary dividend or distribution, or should
there occur any merger, consolidation or other reorganization, then equitable
and proportional adjustments shall be made by the Plan Administrator to the
total number and/or class of securities issuable pursuant to this Award in
order to reflect such change. In making such
equitable and proportional adjustments, the Plan Administrator shall
take into account any amounts to be credited to Participant’s book account
under Paragraph 5(b) in connection with the transaction, and the
determination of the Plan Administrator shall be final, binding and
conclusive.  In the event of a Change in
Control, the provisions of Paragraph 6 shall be controlling.


 


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8.             Issuance
of Shares of Common Stock.


 


(a)           On each applicable Issuance
Date for the Shares which vest in accordance with the provisions of this
Agreement, the Corporation shall issue to or on behalf of the Participant a
certificate (which may be in electronic form) for the vested shares of Common
Stock to be issued on such date and shall concurrently distribute to the
Participant any accrued phantom dividend equivalents with respect to those
vested Shares.


 


(b)           Except as otherwise provided
in Paragraph 6, the settlement of all Restricted Stock Units which vest under
the Award shall be made solely in shares of Common Stock.  No fractional share of Common Stock shall be
issued pursuant to this Award, and any fractional share resulting from any
calculation made in accordance with the terms of this Agreement shall be
rounded down to the next whole share of Common Stock.


 


9.             Compliance
with Laws and Regulations. The issuance of shares 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.


 


10.           Notices.  Any notice required to be given or delivered
to the Corporation under the terms of this Agreement shall be in writing and
addressed to the Corporation at its principal corporate offices, and directed
to the attention of Stock Plan Administrator. 
Any notice required to be given or delivered to Participant shall be in
writing and addressed to Participant at the address on record with the
Corporation.  An email to the email
address of Participant on record with the Corporation shall be deemed written
notice.  All notices shall be deemed
effective upon personal delivery, upon sending of an email or upon deposit in
the U.S. mail, postage prepaid and properly addressed to the party to be
notified.


 


11.           Governing Law.  The interpretation, performance and
enforcement of this Agreement shall be governed by the laws of the State of
California without resort to that State’s conflict-of-laws rules.


 


12.           Successors and Assigns.  Except to the extent otherwise provided in
this Agreement, the provisions of this Agreement shall inure to the benefit of,
and be binding upon, the Corporation and its successors and assigns and
Participant, Participant’s assigns, the legal representatives, heirs and
legatees of Participant’s estate and any beneficiaries of the Award designated
by Participant.


 


13.           Construction.  This Agreement and the Award evidenced hereby
are made and granted pursuant to the Plan and are in all respects limited by
and subject to the terms of the Plan. 
All decisions of the Plan Administrator with respect to any question or
issue arising under the Plan or this Agreement shall be conclusive and binding
on all persons having an interest in the Award.


 


14.           No Impairment of Rights.  Nothing in this Agreement shall in any way
affect the right of the Corporation to adjust, reclassify, reorganize or
otherwise make changes in its capital or business structure or to merge,
consolidate, dissolve, liquidate or sell or transfer 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
applicable law.


 


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15.           Code Section 409A.  It is the intention of the parties that the
provisions of this Agreement comply with the requirements of the short-term
deferral exception of Section 409A of the Code and Treasury Regulations Section 1.409A-1(b)(4).  Accordingly, to the extent there is any
ambiguity as to whether one or more provisions of this Agreement would
otherwise contravene the requirements or limitations of Code Section 409A
applicable to such short-term deferral exception, then those provisions shall
be interpreted and applied in a manner that does not result in a violation of
the requirements or 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, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  Mark
  R. Goldston

  
	
   

  	
   

  	
   

  
	
   

  	
  Title:
  

  	
  Chairman,
  President and Chief Executive Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  PARTICIPANT

  
	
   

  	
   

  
	
   

  	
  Name:
  <Participant Name>

  
	
   

  	
   

  
	
   

  	
  Signature:

  



 


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APPENDIX


 


The following definitions shall be in effect under the Agreement:


 


A.            Agreement shall mean
this Restricted Stock Unit Issuance Agreement.


 


B.            Award shall mean the
award of restricted stock units made to the Participant pursuant to the terms
of this Agreement.


 


C.            Award
Date shall mean the date the restricted stock units are
awarded to Participant pursuant to the Agreement and shall be the date
indicated in Paragraph 1 of the Agreement.


 


D.            Board shall mean the
Corporation’s Board of Directors.


 


E.             Change
in Control shall mean a change in ownership or control of the
Corporation effected through any of the following transactions:


 


(i)    the closing of a merger,
consolidation or other reorganization approved by the Corporation’s
stockholders in which a change in ownership or control of the Corporation is
effected through the acquisition by any person or group of persons comprising a
“group” within the meaning of Rule 13d-5(b)(1) of the 1934 Act (other
than the Corporation or a person that, prior to such transaction, directly or
indirectly controls, is controlled by or is under common control with, the
Corporation) of beneficial ownership (within the meaning of Rule 13d-3 of
the 1934 Act) of securities possessing more than fifty percent (50%) of the
total combined voting power of the Corporation’s outstanding securities (as
measured in terms of the power to vote with respect to 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 the meaning of Rule 13d-5(b)(1) of
the 1934 Act (other than the Corporation or a person that, prior to such
transaction or series of related transactions, directly or indirectly controls,
is controlled by or is under common control with, the Corporation) acquires
directly or indirectly (whether as a result of a single acquisition or by reason
of one or more acquisitions within the twelve (12)-month period ending with the
most recent acquisition) beneficial ownership (within the meaning of Rule 13d-3
of the 1934 Act) of securities possessing more than fifty percent (50%) of the
total combined voting power of the Corporation’s securities (as measured in
terms of the power to vote with respect to the election of Board members)
outstanding immediately after the consummation of such transaction or series of
related transactions, whether such transaction involves a direct issuance from
the Corporation or the acquisition of outstanding securities held by one or
more of the Corporation’s existing stockholders,


 


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(iv)  a merger, recapitalization,
consolidation, or other transaction to which the Corporation is a party or a
sale, transfer or other disposition of all or substantially all of the
Corporation’s assets if, in either case, the members of the Board immediately
prior to consummation of the transaction do not, upon consummation of the
transaction, constitute at least a majority of the board of directors of the
surviving entity or the entity acquiring the Corporation’s assets, as the case
may be, or a parent thereof, or


 


(v)   a change in the composition
of the Board over a period of thirty-six (36) consecutive months or less such
that a majority of the Board members ceases by reason of one or more contested
elections for Board membership to be comprised of individuals who either (A) have
been Board members continuously since the beginning of such period or (B) have
been appointed or nominated for election as Board members during such period by
at least a majority of the Board members described in clause (A) who were
still in office at the time the Board approved such appointment or nomination.


 


F.             Code shall mean the
Internal Revenue Code of 1986, as amended.


 


G.            Common
Stock shall mean shares of the Corporation’s common
stock.


 


H.            Corporation shall mean
United Online, Inc., a Delaware corporation, and any successor corporation
to all or substantially all of the assets or voting stock of United Online, Inc.
which shall by appropriate action adopt the Plan.


 


I.              1934
Act shall mean the Securities Exchange Act of 1934, as amended from time
to time.


 


J.             Participant shall mean the
person to whom the Award is made pursuant to the Agreement.


 


K.            Plan shall mean the
Corporation’s 2010 Incentive Compensation Plan, as amended and restated from
time to time.


 


L.             Plan
Administrator shall mean either the Board or a committee of the
Board acting in its capacity as administrator of the Plan.


 


M.           Permanent
Disability shall mean the inability of Participant to perform
his or her usual duties as a member of the Board by reason of any medically
determinable physical or mental impairment which is expected to result in death
or has lasted or can be expected to last for a continuous period of twelve (12)
months or more.


 


N.            Stock
Exchange shall mean the American Stock Exchange, the Nasdaq
Global or Global Select Market or the New York Stock Exchange.


 


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