Exhibit 10.2


 


UNITED
ONLINE, INC.


2001
STOCK INCENTIVE PLAN

STOCK ISSUANCE AGREEMENT


 


AGREEMENT made this 27th
day of January 2004, by and between United Online, Inc., a Delaware
corporation, and Mark Goldston, a Participant in the Plan.


 


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


 


A.           PURCHASE
OF SHARES


 


1.             Purchase.  Participant hereby purchases 250,000 shares
of Common Stock (the “Purchased Shares”) pursuant to the provisions of the
Stock Issuance Program at the purchase price of $0.0001 per share (the “Purchase
Price”).


 


2.             Payment.  Concurrently with the delivery of this
Agreement to the Corporation, Participant shall pay the Purchase Price for the
Purchased Shares in cash or check payable to the Corporation and shall deliver
a duly-executed blank Assignment Separate from Certificate (in the form
attached hereto as Exhibit I) with respect to the Purchased Shares.


 


3.             Stockholder
Rights.  Until such time
as the Corporation exercises the Repurchase Right, Participant (or any
successor in interest) shall have all the rights of a stockholder (including
voting, dividend and liquidation rights) with respect to the Purchased Shares,
subject, however, to the transfer restrictions of this Agreement.


 


4.             Escrow.  The Corporation shall have the right to hold
the Purchased Shares in escrow until those shares have vested in accordance
with the Vesting Schedule.


 


5.             Compliance
with Law.  Under no
circumstances shall shares of Common Stock or other assets be issued or
delivered to Participant pursuant to the provisions of this Agreement unless,
in the opinion of counsel for the Corporation or its successors, there shall
have been compliance with all applicable requirements of Federal and state
securities laws, all applicable listing requirements of any applicable Stock
Exchange or the Nasdaq Stock Market on which the Common Stock is at the time
listed for trading and all other requirements of law or of any regulatory
bodies having jurisdiction over such issuance and delivery.


 


B.             TRANSFER
RESTRICTIONS


 


1.             Restriction
on Transfer.  Except for
any Permitted Transfer, Participant shall not transfer, assign, encumber or
otherwise dispose of any of the Purchased Shares which are subject to the Repurchase
Right.


 





















 


2.             Restrictive
Legend.  The stock
certificate for the Purchased Shares shall be endorsed with the following
restrictive legend:


 


“The shares represented by this certificate are
unvested and subject to certain repurchase rights granted to the Corporation
and accordingly may not be sold, assigned, transferred, encumbered, or in any
manner disposed of except in conformity with the terms of a written agreement
dated January 27, 2004 between the Corporation and the registered holder
of the shares (or the predecessor in interest to the shares).  A copy of such agreement is maintained at the
Corporation’s principal corporate offices.”


 


3.             Transferee
Obligations.  Each person
(other than the Corporation) to whom the Purchased Shares are transferred by
means of a Permitted Transfer must, as a condition precedent to the validity of
such transfer, acknowledge in writing to the Corporation that such person is
bound by the provisions of this Agreement and that the transferred shares are
subject to the Repurchase Right to the same extent such shares would be so
subject if retained by Participant.


 


C.             REPURCHASE
RIGHT


 


1.             Grant.  The Corporation is hereby granted the right
(the “Repurchase Right”) to repurchase at the Purchase Price any or all of the
Purchased Shares in which Participant is not, at the time of his or her
cessation of Service, vested in accordance with the Vesting Schedule set
forth in Paragraph C.3 of this Agreement or the special vesting acceleration
provisions of Paragraph C.5 of this Agreement (such shares to be hereinafter
referred to as the “Unvested Shares”).


 


2.             Exercise
of the Repurchase Right. 
The Repurchase Right shall be exercisable by written notice delivered to
each Owner of the Unvested Shares during the ninety (90)-day period following
the date Participant ceases for any reason to remain in Service.  The notice shall indicate the number of
Unvested Shares to be repurchased and the date on which the repurchase is to be
effected, such date to be not more than thirty (30) days after the date of such
notice.  The certificates representing
the Unvested Shares to be repurchased shall be delivered to the Corporation on
the closing date specified for the repurchase. 
Concurrently with the receipt of such stock certificates, the Corporation
shall pay to Owner, in cash or cash equivalent (including the cancellation of
any purchase-money indebtedness), an amount equal to the Purchase Price
previously paid for the Unvested Shares to be repurchased from Owner.


 


3.             Termination
of the Repurchase Right. 
The Repurchase Right shall terminate with respect to any Unvested Shares
for which it is not timely exercised under Paragraph C.2.  In addition, the Repurchase Right shall terminate
and cease to be exercisable with respect to any and all Purchased Shares in
which Participant vests in accordance with the following Vesting Schedule:


 


2





















 


(i)            Upon
Participant’s completion of four years of Service measured from January 27,
2004, Participant shall acquire a vested interest in, and the Repurchase Right
shall lapse with respect to, 100% of the Purchased Shares.


 


(ii)           If
Participant’s Service is terminated without cause, Involuntarily Terminated or
terminated due to death or disability (each as defined in the Employment
Agreement), Participant shall acquire a vested interest in, and the Repurchase
Right shall lapse with respect to, 100% of the Purchased Shares.


 


4.             Recapitalization.  Any new, substituted or additional securities
or other property (including cash paid other than as a regular cash dividend)
which is by reason of any Recapitalization distributed with respect to the
Purchased Shares shall be immediately subject to the Repurchase Right and any
escrow requirements hereunder, but only to the extent the Purchased Shares are
at the time covered by such right or escrow requirements.  Appropriate adjustments to reflect such
distribution shall be made to the number and/or class of securities subject to
this Agreement and to the price per share to be paid upon the exercise of the
Repurchase Right in order to reflect the effect of any such Recapitalization
upon the Corporation’s capital structure; provided, however,
that the aggregate purchase price shall remain the same.


 


5.             Corporate
Transaction.


 


(a)   Immediately
prior to the consummation of any Corporate Transaction, the Repurchase Right
shall automatically lapse in its entirety and the Purchased Shares shall vest
in full, except to the extent the Repurchase Right is to be assigned to the
successor corporation (or parent thereof) in connection with the Corporate
Transaction.


 


(b)   To the
extent the Repurchase Right remains in effect following a Corporate
Transaction, such right shall apply to the new capital stock or other property
(including any cash payments) received in exchange for the Purchased Shares in
consummation of the Corporate Transaction, but only to the extent the Purchased
Shares are at the time covered by such right. 
Appropriate adjustments shall be made to the price per share payable
upon exercise of the Repurchase Right to reflect the effect of the Corporate
Transaction upon the Corporation’s capital structure; provided,
however, that the aggregate purchase price shall remain the
same.  The new securities or other
property (including cash payments) issued or distributed with respect to the
Purchased Shares in consummation of the Corporate Transaction shall immediately
be deposited in escrow with the Corporation (or the successor entity) and shall
not be released from escrow until Participant vests in such securities or other
property in accordance with the same Vesting Schedule in effect for the
Purchased Shares.


 


D.            SPECIAL
TAX ELECTION


 


1.             Section 83(b) Election.  Under Code Section 83, the excess of the
fair market value of the Purchased Shares on the date any forfeiture
restrictions applicable to such shares lapse over the Purchase Price paid for
such shares will be reportable as ordinary income on the lapse date.  For this purpose, the term “forfeiture
restrictions” includes the right of the


 


3





















 


Corporation to repurchase the Purchased Shares pursuant to
the Repurchase Right.  Participant may
elect under Code Section 83(b) to be taxed at the time the Purchased
Shares are acquired, rather than when and as such Purchased Shares cease to be
subject to such forfeiture restrictions. 
Such election must be filed with the Internal Revenue Service within
thirty (30) days after the date of this Agreement.  Even if the fair market value of the
Purchased Shares on the date of this Agreement equals the Purchase Price paid
(and thus no tax is payable), the election must be made to avoid adverse tax
consequences in the future.  THE FORM FOR MAKING THIS ELECTION IS ATTACHED AS EXHIBIT II
HERETO.  PARTICIPANT
UNDERSTANDS THAT FAILURE TO MAKE THIS FILING WITHIN THE APPLICABLE THIRTY
(30)-DAY PERIOD WILL RESULT IN THE RECOGNITION OF ORDINARY INCOME AS THE
FORFEITURE RESTRICTIONS LAPSE.


 


2.             FILING
RESPONSIBILITY.  PARTICIPANT
ACKNOWLEDGES THAT IT IS PARTICIPANT’S SOLE RESPONSIBILITY, AND NOT THE
CORPORATION’S, TO FILE A TIMELY ELECTION UNDER CODE SECTION 83(b), EVEN IF
PARTICIPANT REQUESTS THE CORPORATION OR ITS REPRESENTATIVES TO MAKE THIS FILING
ON HIS OR HER BEHALF.


 


E.              GENERAL
PROVISIONS


 


1.             Assignment.  The Corporation may assign the Repurchase
Right to any person or entity selected by the Board, including (without
limitation) one or more stockholders of the Corporation.


 


2.             Notices.  Any notice required to be given under this
Agreement shall be in writing and shall be deemed effective upon personal
delivery or upon deposit in the U.S. mail, registered or certified, postage
prepaid and properly addressed to the party entitled to such notice at the
address indicated below such party’s signature line on this Agreement or at
such other address as such party may designate by ten (10) days advance
written notice under this paragraph to all other parties to this Agreement.


 


3.             No Waiver.  The failure of the Corporation in any
instance to exercise the Repurchase Right shall not constitute a waiver of any
other repurchase rights that may subsequently arise under the provisions of
this Agreement or any other agreement between the Corporation and
Participant.  No waiver of any breach or
condition of this Agreement shall be deemed to be a waiver of any other or
subsequent breach or condition, whether of like or different nature.


 


4.             Cancellation
of Shares.  If the
Corporation shall make available, at the time and place and in the amount and
form provided in this Agreement, the consideration for the Purchased Shares to
be repurchased in accordance with the provisions of this Agreement, then from
and after such time, the person from whom such shares are to be repurchased
shall no longer have any rights as a holder of such shares (other than the
right to receive payment of such consideration in accordance with this
Agreement).  Such shares shall be deemed
purchased in accordance with the applicable provisions hereof, and the
Corporation shall be deemed the owner and holder of such shares, whether or not
the certificates therefor have been delivered as required


 


4





















 


by this Agreement.


 


5.             Participant
Undertaking.  Participant
hereby agrees to take whatever additional action and execute whatever
additional documents the Corporation may deem necessary or advisable in order
to carry out or effect one or more of the obligations or restrictions imposed
on either Participant or the Purchased Shares pursuant to the provisions of
this Agreement.


 


6.             Agreement
is Entire Contract.  This
Agreement constitutes the entire contract between the parties hereto with
regard to the subject matter hereof. 
This Agreement is made pursuant to the provisions of the Plan and shall
in all respects be construed in conformity with the terms of the Plan.


 


7.             Governing
Law.  This Agreement shall
be governed by, and construed in accordance with, the laws of the State of
Delaware without resort to that State’s conflict-of-laws rules.


 


8.             Counterparts.  This Agreement may be executed in
counterparts, each of which shall be deemed to be an original, but all of which
together shall constitute one and the same instrument.


 


9.             Successors
and Assigns.  The
provisions of this Agreement shall inure to the benefit of, and be binding
upon, the Corporation and its successors and assigns and upon Participant,
Participant’s assigns and the legal representatives, heirs and legatees of
Participant’s estate, whether or not any such person shall have become a party
to this Agreement and have agreed in writing to join herein and be bound by the
terms hereof.


 


5





















 


IN WITNESS WHEREOF, the parties
have executed this Agreement on the day and year first indicated above.


 


	
   

  	
  UNITED ONLINE, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Frederic A. Randall, Jr.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
  EVP and General Counsel

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Address:

  	
  2555 Townsgate Road

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Westlake Village, CA 91361

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  PARTICIPANT

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Mark R. Goldston

  	
   

  
	
   

  	
  Signature

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Address:

  	
  XXXXXXX

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  XXXXXXX

  	
   

  
					



 





















 


SPOUSAL
ACKNOWLEDGMENT


 


The undersigned spouse of the Participant has read and
hereby approves the foregoing Stock Issuance Agreement.  In consideration of the Corporation’s
granting the Participant the right to acquire the Purchased Shares in
accordance with the terms of such Agreement, the undersigned hereby agrees to
be irrevocably bound by all the terms of such Agreement, including (without
limitation) the right of the Corporation (or its assigns) to purchase any
Purchased Shares in which the Participant is not vested at the time of his or
her termination of Service.


 


	
   

  	
  /s/ Nancy Jane Goldston

  	
   

  
	
   

  	
  PARTICIPANT’S SPOUSE

  
	
   

  	
   

  
	
   

  	
  Address:

  	
  XXXXXXX

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  XXXXXXX

  	
   

  
					



 





















 


EXHIBIT I


 


ASSIGNMENT
SEPARATE FROM CERTIFICATE


 


1.             FOR VALUE RECEIVED
                        hereby sell(s), assign(s) and transfer(s)
unto United Online, Inc. and any successor to its rights (the “Corporation”),
                                 
(           ) shares of the
Common Stock of the Corporation standing in his or her name on the books of the
Corporation represented by Certificate No.                     herewith and do(es) hereby irrevocably
constitute and appoint                                            
Attorney to transfer the said stock on the books of the Corporation with full
power of substitution in the premises.


 


Dated:                              ,
             .


 


 


	
   

  	
  Signature

  	
   

  	
   

  



 


 


Instruction:  Please do not fill in any blanks other than
the signature line.  Please sign exactly
as you would like your name to appear on the issued stock certificate.  The purpose of this assignment is to enable
the Corporation to exercise the Repurchase Right without requiring additional
signatures on the part of Participant.


 





















 


EXHIBIT II


 


SECTION 83(b) TAX
ELECTION


 


This statement is being made under Section 83(b) of
the Internal Revenue Code, pursuant to Treas. Reg. Section 1.83-2.


 


1.                                       The taxpayer who performed the services
is:


 


Name:

Address:

Taxpayer Ident. No.:


 


2.                                       The property with respect to which the
election is being made is
             shares of the common stock of United Online, Inc.


 


3.                                       The property was issued on                                   ,
                .


 


4.                                       The taxable year in which the election is
being made is the calendar year                     .


 


5.                                       The property is subject to a repurchase
right pursuant to which the issuer has the right to acquire the property at the
original purchase price if for any reason taxpayer’s service with the issuer
terminates.  The issuer’s repurchase
right will lapse in whole or in part over a 48-month period ending
on  January 27, 2008.


 


6.                                       The fair market value at the time of
transfer (determined without regard to any restriction other than a restriction
which by its terms will never lapse) is
$             
per share.


 


7.                                       The amount paid for such property is
$             per share.


 


8.                                       A copy of this statement was furnished to
United Online, Inc. for whom taxpayer rendered the services underlying the
transfer of property.


 


9.                                       This statement is executed on                                      ,
              .


 


 


	
   

  	
   

  	
   

  
	
  Spouse (if any)

  	
   

  	
  Taxpayer

  



 


 


This election must be filed with
the Internal Revenue Service Center with which taxpayer files his or her
Federal income tax returns and must be made within thirty (30) days after the
execution date of the Stock Issuance Agreement. 
This filing should be made by registered or certified mail, return
receipt requested.  Participant must
retain two (2) copies of the completed form for filing with his or her
Federal and state tax returns for the current tax year and an additional copy
for his or her records.


 





















 


APPENDIX


 


The following definitions shall be in effect under the
Agreement:


 


A.            Agreement
shall mean this Stock Issuance Agreement.


 


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


 


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


 


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


 


E.             Corporate
Transaction shall have the meaning set forth in the Employment
Agreement.


 


F.             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 has assumed
United Online, Inc.’s rights under this Agreement.


 


G.            Employment
Agreement shall mean that certain Amended and Restated
Employment Agreement dated effective as of January 27, 2004, by and
between the Corporation and Participant.


 


H.            Involuntary Termination
shall have the meaning set forth in the Employment Agreement.


 


I.              Owner
shall mean Participant and all subsequent holders of the Purchased Shares who
derive their chain of ownership through a Permitted Transfer from Participant.


 


J.             Participant
shall mean the person to whom the Purchased Shares are issued under the Stock
Issuance Program.


 


K.            Permitted Transfer
shall mean (i) a gratuitous transfer of the Purchased Shares, provided and only if Participant obtains the Corporation’s
prior written consent to such transfer, (ii) a transfer of title to the
Purchased Shares effected pursuant to Participant’s will or the laws of
inheritance following Participant’s death or (iii) a transfer to the
Corporation in pledge as security for any purchase-money indebtedness incurred
by Participant in connection with the acquisition of the Purchased Shares.


 


L.             Plan
shall mean the United Online, Inc. 2001 Stock Incentive Plan.


 


M.           Plan Administrator
shall mean either the Board or a committee of the Board acting in its
administrative capacity under the Plan.


 


N.            Purchase Price
shall have the meaning assigned to such term in Paragraph A.1.


 


A-1





















 


O.            Purchased Shares
shall have the meaning assigned to such term in Paragraph A.1.


 


P.             Recapitalization
shall mean any stock split, stock dividend, recapitalization, combination of
shares, exchange of shares or other change affecting the Corporation’s
outstanding Common Stock as a class without the Corporation’s receipt of
consideration.


 


Q.            Repurchase Right
shall mean the right granted to the Corporation in accordance with Article C.


 


R.            Service
shall mean the Participant’s performance of services for the Corporation in the
capacity of an employee, as described in the Employment Agreement.


 


S.             Stock
Issuance Program shall mean the Stock Issuance Program under the
Plan.


 


T.            Subsidiary
shall mean any corporation (other than the Corporation) in an unbroken chain of
corporations beginning with the Corporation, provided each corporation (other
than the last corporation) in the unbroken chain owns, at the time of the
determination, stock possessing fifty percent (50%) or more of the total
combined voting power of all classes of stock in one of the other corporations
in such chain.


 


U.            Vesting Schedule shall
mean the vesting schedule specified in Paragraph C.3, pursuant to which
the Purchased Shares are to vest in whole or in part over Participant’s period
of Service.


 


V.            Unvested Shares
shall have the meaning assigned to such term in Paragraph C.1.


 


A-2