**Exhibit 10.18**

June1, 2006

JeremyHelfand

DearJeremy,

This letter sets forth the terms and conditions of your employment withUnited Online, Inc. (the “Company”).

# 1.             **Position**.** **You will serve asExecutive Vice President, Sales and Chief Sales Officer of the Company.  You will report to me as the Chief ExecutiveOfficer of the Company and you agree to devote your full-time attention, skilland efforts to the performance of your duties for the Company.  Youremployment with the Company will commence on a date (the “Commencement Date”)to be determined by you, which date will be no later than July 1, 2006.

# 2.             **Salary and Benefits**.  You will be paid a salary at the annual rateof $350,000, payable in bi-weekly installments in accordance with the Company’sstandard payroll practices, subject to any increases as determined by the Boardof Directors of the Company (the “Board of Directors”) from time to time.  You will be eligible to participate in theCompany’s employee benefits plans, including its 401(k) plan.  In addition, you will be entitled toparticipate in the Company’s Exec-U-Care Medical Reimbursement Insurance Planso long as such plan is made generally available to the Company’s seniorexecutives.  You will be entitled to aminimum of 4 weeks of paid vacation each year or such greater amount asdetermined in accordance with the Company’s standard vacation policy.  The Company will reimburse you (or pay) forcertain relocation expenses as set forth in Exhibit A attached hereto.

# 3.             **Bonus.**

# **a.             Signing Bonus.  **Within seven (7) days following the Commencement Date, you will receivea signing bonus (the “Signing Bonus”) equal to $100,000.  In the event your employment with the Companyis terminated prior to the one (1)-year anniversary of the Commencement Date (i)by the Company “for cause” (as defined below) or (ii) by you other than as aresult of death, “Disability” or for “good reason” (each term as definedbelow), you will pay the Company the full amount of the Signing Bonus withinfourteen (14) days following the date of termination (it being understood thatyou will only have to pay the net amount of the Signing Bonus (*i.e.*, the full amount of the Signing Bonus*less* the amount of taxwithholdings) if such termination occurs in the same tax year as the payment ofthe Signing Bonus and the applicable governmental authorities return to theCompany the amount of such tax withholdings previously paid thereto).

# **b.             Annual Bonus.**  Forfiscal year 2006, you will receive a bonus equal to no less than $175,000.  The bonus amount will be determined by theCompensation Committee of the Board of Directors, and the bonus will be payableno later than March 31, 2007, concurrently with the Company’s payment offiscal year 2006 bonuses to its other executive officers, provided that youcontinue to be employed by the Company when such bonuses are paid.  For fiscal years 2007 and 2008, you will beeligible to participate in a bonus program with eligibility for up to 100% ofyour annual base salary.  The criteriafor a bonus for fiscal years 2007 and 2008 and the amounts of such bonuses willbe determined by the Board of Directors or a committee thereof.

# 4.             **Restricted StockUnits. **On August 15, 2006,you will be awarded restricted stock units covering 130,000 shares of theCompany’s common stock (the “Restricted Stock Units”).  The Restricted Stock Units will be subject tothe standard terms and conditions set forth in the applicable stock plan and 

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# the Company’s standard formrestricted stock unit agreement for employees. The Restricted Stock Units will contain the following four (4)-yearvesting schedule based on your continued employment with the Company: 25% ofthe underlying shares of the Company’s common stock will vest on each one(1)-year anniversary of August 15, 2006 such that 100% will have vested by thefour (4)-year anniversary of such date. As more fully addressed in the restricted stock unit agreement,outstanding restricted stock units are entitled to receive regularly-scheduledcash dividends the Company declares on its common stock.  Dividends paid on restricted stock units aretreated as ordinary income for tax purposes.

Upon the termination of your employmentby the Company “without cause” or by you for “good reason” (each term asdefined below) prior to December 31, 2008, the vesting of your outstandingRestricted Stock Units will be accelerated by the additional number of sharesin which you would have been vested at the time of such termination if you hadcompleted an additional twelve (12) months of service (calculated as if suchunits vest on a monthly basis).  Suchvesting acceleration will be contingent upon your signing the Release referredto in Section 7(b) below.  The standard provisionsof the stock plan(s) and related documents applicable to the Restricted StockUnits will provide for certain vesting acceleration in the event of thetermination of your employment within the twelve (12)-month period following achange of control of the Company.  In theevent all other executives’ employment agreements are modified to provide forvesting acceleration benefits of their existing Restricted Stock Units inanticipation of a change of control (as opposed to only following a change ofcontrol), you will be provided with a similar benefit with respect to the RestrictedStock Units referred to herein.  Upon thetermination of your employment as a result of death or Disability (as definedbelow) prior to December 31, 2008, the vesting of your outstanding RestrictedStock Units will be accelerated by the additional number of shares in which youwould have been vested at the time of such termination if you had completed anadditional twelve (12) months of service (calculated as if such units vest on amonthly basis).  In the event of aninconsistency between the terms set forth in this paragraph and the terms setforth in the applicable stock plan and/or restricted stock unit agreement, theterms set forth in this letter will control; provided, however, that theforegoing will not be construed to diminish the rights that you have under theapplicable stock plan and/or restricted stock unit agreement. The provisions ofthis paragraph will only apply to the Restricted Stock Units referred toherein, although future equity awards may also be covered by this paragraph ifso stated in a resolution of the Board of Directors or a committee thereof.

# 5.             **Policies; Procedures;Proprietary Information and Inventions Agreement**.  As an employee of the Company, you will beexpected to abide by all of the Company’s policies and procedures, including,without limitation, the terms of the Proprietary Information and InventionsAgreement between you and the Company, the Insider Trading Policy, the Code ofEthics and the Employee Handbook, and you agree to execute the foregoing uponcommencement of your employment.

# 6.             **At Will Employment**.  Notwithstanding anything to the contrarycontained herein, your employment with the Company will be “at will” and willnot be for any specified term, meaning that either you or the Company will beentitled to terminate your employment at any time and for any reason, with orwithout cause.  Any contraryrepresentations that may have been made to you are superseded by the terms setforth in this letter.  This is the fulland complete agreement between you and the Company on this subject.  Although your job duties, title, compensationand benefits, as well as the Company’s personnel policies and procedures, maychange from time to time, the “at will” nature of your employment may only bechanged in an express written agreement signed by you and the Chief ExecutiveOfficer of the Company.

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# 7.**             Terminationof Employment**

## **a.             Terminationby You. **If you terminate your employment with theCompany for any reason, other than as a result of death or Disability or for “goodreason” as defined below, all obligations of the Company as set forth in thisletter will cease, other than the obligation to pay you for services renderedthrough the date of termination, to pay you for any accrued but unused vacationdays as of the date of termination, and to fulfill its obligations  in accordance with the terms of theapplicable stock plan and restricted stock unit agreement.  If you terminate your employment with theCompany for “good reason,” as defined below, in addition to the foregoing, theCompany will pay you the Separation Payment (as defined below) subject to theconditions set forth in Section 7(b) below, and you will be entitled to theacceleration of vesting provided in Section 4 above.  However, and notwithstanding the terminationof your employment by you, you will continue to be obligated to comply with theterms of the Proprietary Information and Inventions Agreement and ifapplicable, the noncompetition provisions set forth in Section 9 below.

## **b.             Terminationby the Company. **If your employment is terminated by theCompany “without cause” as defined below, and subject to the signing of arelease, the form of which is attached hereto as Exhibit B (the “Release”),the Company will pay you a separation payment (the “Separation Payment”)calculated as follows: (i) in the event the termination date is on or prior tothe one (1) year anniversary of the Commencement Date, the Separation Paymentwill be an amount equal to one (1) year of your then current annual base salary(and, for the purpose of clarity, the Company acknowledges that you will not beobligated to pay back the Signing Bonus); or (ii) in the event the terminationdate is between the first anniversary of the Commencement Date and December 31,2008, the Separation Payment will be an amount equal to one (1) year of yourthen current annual base salary  *plus* the Annual Bonus (as definedherein).  For purposes of the immediatelypreceding sentence, “Annual Bonus” means your then current annual base salary *multiplied* by the bonus percentage used tocalculate the bonus awarded to you for the immediately preceding year and *prorated* based on the elapsed time betweenDecember 31 of the immediately preceding year and the termination date.  Subject to the Code Section 409A deferral perioddescribed in Section 7(e) below, if applicable, this Separation Payment will bepayable monthly on a pro rata basis over twelve (12) months after suchtermination.  Payment of this SeparationPayment will be contingent on your signing the Release and your compliance withthe terms of the Proprietary Information and Inventions Agreement and thenoncompetition provisions set forth in Section 9 below.  Upon termination of your employment “withoutcause,” other than the obligations set forth in the first sentence of Section7(a) above and the acceleration of vesting provided in Section 4 above, theCompany will have no further obligation to you except pursuant to thisparagraph.

If your employment is terminated by the Company “with cause” as definedbelow, the Company will have no further obligation to you under the terms ofthis letter, other than the obligations set forth in the first sentence ofSection 7(a) above.  However, andnotwithstanding the termination of your employment by the Company “with cause”or “without cause,” or by you for “good reason,” you will continue to beobligated to comply with the terms of the Proprietary Information andInventions Agreement and if applicable, the noncompetition provisions set forthin Section 9 below.

You have the right decline to receive a portion of the benefits setforth under Sections 4 and 7 in the event that you determine that the provisionof such benefits to you would result in a “parachute payment” as such term isdefined in Section 280(G)(b)(2) of the Internal Revenue Code of 1986.

**c.**             **Terminationby Death or Disability.**  Ifyour employment is terminated as a result of your death, the Company will beobligated to pay your estate or beneficiaries (as the case may be) for servicesrendered by you for the Company through the date of your death.  If your employment is terminated as a resultof your Disability, as defined below, the Company will be obligated to pay youfor 

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servicesrendered by you for the Company through the date of your termination.  In the event of termination of youremployment due to death or Disability, you, your estate or your beneficiaries,as appropriate, will be entitled to the acceleration benefits set forth inSection 4.  The provisions of thisSection 7(c) will not affect or change the rights or benefits to which you areotherwise entitled under the Company’s benefits plans or otherwise.

**d.             Definitions.**

Forpurposes of this letter, “good reason” means:

(i)                   a reduction in your base salary without yourprior written consent;

(ii)                a material reduction in your position, dutiesor responsibilities, without your prior written consent;

(iii)             a change in your place of employment which isnot within a 50-mile radius of the following address, without your priorwritten consent: 21301 Burbank Boulevard, Woodland Hills, CA 91367, or

(iv)          any material breach by the Company of the terms of this letter which isnot cured by the Company within fifteen (15) days following receipt of writtennotice thereof.

For purposes of this letter, “with cause” means theextreme cases in which you commit, or fail to perform, of any one or more ofthe following acts:

(i)               willfullydamaging of the property, business, business relationships, reputation orgoodwill of the Company or its subsidiaries;

(ii)                commission of a felony or a misdemeanorinvolving moral turpitude;

(iii)             theft, dishonesty, fraud or embezzlement;

(iv)            willfully violating any rules or regulationsof any governmental or regulatory body that is or is reasonably expected to beinjurious to the Company or its subsidiaries;

(v)               the use of alcohol, narcotics or othercontrolled substances to the extent that it prevents you from efficientlyperforming services for the Company or its subsidiaries;

(vi)            willfully injuring any other employee of theCompany or its subsidiaries;

(vii)         willfully injuring any person in the course of performance of servicesfor the Company or its subsidiaries;

(viii)      disclosing to a competitor or other unauthorized persons confidentialor proprietary information or secrets of the Company or its subsidiaries;

(ix)              solicitation of business on behalf of acompetitor or a potential competitor of the Company or its subsidiaries;

(x)                 harassment of any other employee of theCompany or its subsidiaries or the commission of any act which otherwisecreates an offensive work environment for other employees of the Company or itssubsidiaries;

(xi)              failure for any reason within fifteen(15)  days after receipt by you ofwritten notice thereof from the Company, to (a) use your good faith best effortsto correct, cease or otherwise alter any insubordination, failure to complywith instructions, inattention to or neglect of important  duties to be performed by you or other act oromission to act that does or may adversely affect the business or operations ofthe Company or its subsidiaries or (b) otherwise use your best efforts tofollow the reasonable and good faith written direction of the Board ofDirectors consistent with the scope of your duties;

(xii)           breach of any material term of this letter and failure to cure withinfifteen (15) days of written notice; or

(xiii)        any other act of gross misconduct, which may include, withoutlimitation, the violation of an important Company policy, that is determined toconstitute “cause” in the good faith discretion of the Board of Directors.

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For purposes of this letter, “without cause” means any reason notwithin the scope of the definition of the term “with cause.”

For purposes of this letter, “Disability” means your inability toengage in any substantial gainful activity necessary to perform your duties asChief Sales Officer by reason of any medically determinable physical or mentalimpairment which can be expected to result in death or which has lasted, or canbe expected to last, for a continuous period of not less than twelve (12)months.

**e.**             **Code Section409A Deferral Period.** Notwithstanding any provision to the contrary in this letter, no paymentor distribution under this letter which constitutes an item of deferredcompensation under Section 409A of the Internal Revenue Code (the “Code”) andbecomes payable by reason of your termination of employment with the Companywill be made to you prior to the earlier of (i) the expiration of the six(6)-month period measured from the date of your “separation from service” (assuch term is defined in Treasury Regulations issued under Code Section 409A) or(ii) the date of your death, if you are deemed at the time of such separationfrom service to be a “key employee” within the meaning of that term under CodeSection 416(i) and such delayed commencement is otherwise required in order toavoid a prohibited distribution under Code Section 409A(a)(2).  Upon the expiration of the applicable CodeSection 409A(a)(2) deferral period, all payments and benefits deferred pursuantto this Section 7(e) (whether they would have otherwise been payable in asingle sum or in installments in the absence of such deferral) shall be paid orreimbursed to you in a lump sum, and any remaining payments due under thisletter will be paid in accordance with the normal payment dates specified forthem herein.

# 8.             **Withholding Taxes**.  All forms of compensation referred to in thisletter are subject to reduction to reflect applicable withholding and payrolltaxes.

# 9.             **Noncompetition Covenants**.  Until one (1) year after termination of youremployment with the Company for any reason, so long as you are receiving theSeparation Payment, you will not, at any place in any county, city or otherpolitical subdivision of the United States in which the Company or itssubsidiaries is engaged in business or providing its services:

a.             directly or indirectly design,develop, manufacture, market or sell any product or service which is incompetition with the products or services of the Company or its subsidiaries;or

b.             directlyor indirectly own any interest in, control, be employed by or associated withor render advisory, consulting or other services (including but not limited toservices in research) to any person or entity, or subsidiary, subdivision,division or joint venture of such entity in connection with the design,development, manufacture, marketing or sale of a product or service which is incompetition with the products or services of the Company or its subsidiaries;provided, however, that nothing in this letter will prohibit you from owningless than one percent (1%) of the equity interests of any publicly held entity.

# 10.           **Entire Agreement**.  This letter, together with the ProprietaryInformation and Inventions Agreement, any Company handbooks and policies ineffect from time to time and the applicable stock option plan and restrictedstock unit agreement, contains all of the terms of your employment with theCompany and supersedes any prior understandings or agreements, whether oral orwritten, between you and the Company.  Ifany provision of this letter is held by an arbitrator or a court of competentjurisdiction to conflict with any federal, state or local law, or to beotherwise invalid or unenforceable, such provision shall be construed in a mannerso as to maximize its enforceability while giving the greatest effect aspossible to the parties’ intent.  To theextent any provision cannot be construed to be 

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# enforceable, such provisionwill be deemed to be eliminated from this letter and of no force or effect andthe remainder of this letter will otherwise remain in full force and effect andbe construed as if such portion had not been included in this letter.  This letter is not assignable by you.  This letter may be assigned by the Company toits subsidiaries or to successors in interest to the Company or its lines ofbusiness.

# 11.           **Amendment and GoverningLaw**.  This letter may not beamended or modified except by an express written agreement signed by you andthe Chief Executive Officer of the Company. The terms of this letter and the resolution of any disputes will begoverned by California law, and venue for any disputes will be in Los Angeles,California.

12.           **Term.**  This letter will expire on December 31, 2008,except Sections 6, 9, 10, 11, and 12 will survive such expiration.  The expiration of this letter will not affectany right to Separation Payments or benefits based on an event which occurredon or before December 31, 2008. Following the expiration of this letter, your employment with theCompany will continue to be “at will.”

We look forward to working with you. You may indicate your agreement with these terms by signing and datingthis letter.  This letter is contingentupon the successful completion of a background investigation.

If you have any questions, please call the undersigned.
|        | Very truly yours,   |
|--------|---------------------|
|   |                |   |
|   | UNITED ONLINE, INC. |
|   |                |   |
|   |                |   |
|   | By:                 | /s/ MARK R. GOLDSTON |
|   | Name:               | Mark R. Goldston |
|   | Title:              | Chairman & Chief Executive Officer |

 

I have read the foregoingand accept the terms set forth in this letter:
| /s/ JEREMY HELFAND   |   |   |
|----------------------|--------|--------|
| Jeremy Helfand       |
|                 |
| Dated: June 1,  2006 |

 

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**Exhibit A**

RELOCATION PACKAGE

TheCompany will reimburse you (or pay) for reasonable expenses incurred in movingyour household goods from Baltimore, Maryland to the greater Los Angeles,California area, including up to two vehicles, storage (if necessary), packingand unpacking.  The Company will alsoreimburse you (or pay) for reasonable expenses incurred in connection with upto four (4) house-hunting trips taken by you and your immediate family to thegreater Los Angeles, California area, including tours of specific areas, costsof hotels, and meals.  In addition, theCompany will reimburse you (or pay) for three (3) months of temporary furnishedhousing (and up to three (3) additional months if your current house inBaltimore, Maryland has not sold by the end of the initial three (3)-monthperiod) and up to two (2) points on a mortgage loan for the purchase of a homein the greater Los Angeles, California area. In addition, the Company will reimburse you for realtor salescommissions paid by you in connection with the sale of your current house inBaltimore, Maryland.  To the extentpossible, the Company will structure such reimbursement and payments tominimize the tax ramifications to you, if any. To the extent you are taxed for any of such matters, the Company willpay you such amounts as are necessary to cover such taxes.

TheCompany, in its sole discretion, may determine the reasonableness of anyparticular item or service, and may decline to reimburse or pay for expenses itfinds unreasonable.  The Company will notpay for relocation costs incurred more than six (6) months after the CommencementDate.

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**Exhibit B**

RELEASE

***[to be attached]***

 

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EXHIBIT B[FORM OF]

**RELEASE AND WAIVER OF CLAIMS**

In consideration of theseverance payments and other benefits to which I have become entitled, pursuantto that certain letter agreement between United Online, Inc., a Delawarecorporation (the “Company”), and myselfdated       ,       (the“Employment  Agreement”), in connectionwith the termination of my employment on this date, I,           herebyfurnish the Company with the following release and waiver (“Release and Waiver”).

I hereby release andforever discharge the Company, its officers, directors, agents, employees,stockholders, successors, assigns and affiliates from any and all claims,liabilities, demands, causes of action, costs, expenses, attorney fees,damages, indemnities and obligations of every kind and nature, in law, equityor otherwise, known and unknown, suspected and unsuspected, disclosed andundisclosed, arising from or relating to my employment with the Company and thetermination of that employment, including (without limitation) claims ofwrongful discharge, emotional distress, defamation, fraud, breach of contract,breach of the covenant of good faith and fair dealing, discrimination claimsbased on sex, age, race, national origin, disability or any other basis underTitle VII of the Civil Rights Act of 1964, as amended, the California FairEmployment and Housing Act, the Federal Age Discrimination in Employment Act of1967, as amended (“ADEA”),  the Americanswith Disability Act,  contract claims,tort claims, and wage or benefit claims, including but not limited to, claimsfor salary, bonuses, commissions, stock grants, stock options, vestingacceleration, vacation pay, fringe benefits, severance pay or any other form ofcompensation (other than the payments, rights, benefits and indemnification towhich I am entitled under the express provisions of the Employment Agreement,my vested rights under the Company’s Code Section 401(k) Plan and any workers’compensation benefits under any Company workers’ compensation insurance policyor fund).

In releasing claimsunknown to me at present, I am waiving all rights and benefits under Section1542 of the California Civil Code, and any law or legal principle of similareffect in any jurisdiction:  **“A general release does not extend to claims which the creditor doesnot know or suspect to exist in his favor at the time of executing the release,which if known by him must have materially affected his settlement with thedebtor.”**

I understand and agreethat the Company has no obligation to provide me with any severance benefitsunder my Employment Agreement unless I execute the Release.  I also understand that I have received orwill receive, regardless of the execution of the Release, all wages owed to metogether with any accrued but unused vacation pay, less applicable withholdingsand deductions, earned through my termination date.

This Release and Waiverdoes not pertain to any claims which may subsequently arise in connection withthe Company’s default in any of its severance payment or indemnificationobligations under the Employment Agreement. I also understand that nothing in the Release shall prohibit me fromexercising legal rights that are, as a matter of law, not subject to waiversuch as: (a) my rights under applicable workers’ compensation laws; (b) myright, if any, to seek unemployment benefits; and (c) my right to file a chargewith the Equal Opportunity Commission (EEOC) challenging the validity of mywaiver of claims under the ADEA.

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Any controversy or anyclaim arising out of or relating to the interpretation, enforceability orbreach of the Release shall be settled by arbitration in accordance with theemployment arbitration rules of the American Arbitration Association or anysuccessor hereto; provided, however, that the arbitrator shall not be empoweredto add to, subtract from, or modify, alter or amend the terms of the Release,and the cost of such arbitration shall be borne by the Company.

I acknowledge that, amongother rights subject to his Release and Waiver, I am hereby waiving andreleasing any rights I may have under ADEA, that this release and waiver isknowing and voluntary, and that the consideration given for this release andwaiver is in addition to anything of value to which I was already entitled asan executive of the Company.  I furtheracknowledge that I have been advised, as required by the Older Workers BenefitProtection Act, that:  (a) the releaseand waiver granted herein does not relate to claims which may arise after thisrelease and waiver is executed; (b) I have the right to consult with anattorney prior to executing this release and waiver (although I may choosevoluntarily not to do so); and if I am over 40 years old upon execution of this(c) I have twenty-one (21) days from the date of termination of my employmentwith the Company in which to consider this release and waiver (although I maychoose voluntarily to execute this release and waiver earlier); (d) I haveseven (7) days following the execution of this release and waiver to revoke myconsent to this release and waiver; and (e) this release and waiver shall notbe effective until the seven (7)-day revocation period has expired.
|                                                                                          |          |
|------------------------------------------------------------------------------------------|---------------|
| Date:        ,  20      |          |
|                                                                                     | **EXECUTIVE** |
|                                                                                     |          |

 

 

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