Document:

Exhibit 10.2

 

AMENDED AND RESTATED

 

UNITED ONLINE, INC.

 

SEVERANCE BENEFIT PLAN

 

AND

 

SUMMARY PLAN DESCRIPTION

 

 

Amended and Restated Effective January 1, 2010

and

Further Amended Effective April 11, 2011

 

 

UNITED ONLINE, INC. SEVERANCE BENEFIT PLAN

AND

SUMMARY PLAN DESCRIPTION

 

I.                                        INTRODUCTION

 

United Online, Inc. (the “Company”) grants severance pay to terminated full-time employees only under limited circumstances.  The Company retains the right to amend, modify or terminate its severance pay policy at any time, in whole or part, and to determine employee eligibility for severance pay and the amount of severance pay at its sole discretion; provided, however, that this Plan may not be amended, modified or terminated within eighteen (18) months following the consummation of a Transaction (as defined below) with respect to eligible employees as of the closing of that Transaction.

 

This Plan shall only apply to the Company and the subsidiaries of the Company listed in attached Schedule A.  The Plan shall not apply to any other subsidiary, parent or affiliated company unless the Chief Executive Officer of the Company so extends the application of this Plan in a written addendum to attached Schedule A. This Plan shall not apply to any subsidiary listed in attached Schedule A following the time such subsidiary ceases to be a direct or indirect subsidiary of the Company.

 

This Severance Benefit Plan (the “Plan”) supersedes all obligations, agreements or policies regarding severance pay, except such terms as are set forth in a written agreement signed by an authorized officer of the Company or one of its subsidiaries and in effect at the time of the applicable termination of employment.  This Plan supplements any such written agreements to provide all terms that are not otherwise expressly incorporated into those written agreements.  The purpose of severance pay is to provide economic help to compensate for periods of unemployment due to job loss as provided herein.

 

This Plan is designed to be an “employee welfare benefit plan,” as defined in Section 3(1) of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”) and to meet the descriptive requirements of a plan constituting a “severance pay plan” within the meaning of the regulations published by the Secretary of Labor at Title 29, Code of Federal Regulations, section 2510.3-2(b).  This document shall also serve as a Summary Plan Description.  Accordingly, the benefits paid by the Plan are not deferred compensation and no employee shall have a vested right to such benefits.

 

II.                                   DEFINITIONS

 

For purposes of this Plan, the following definitions shall be in effect:

 

“base pay” means: (a) in the case of a Layoff Termination (as defined herein): (i) if you are a salaried employee, your set weekly salary (“Weekly Salary”) in effect as of your termination date or (ii) if you are an employee paid on an hourly basis, your base hourly rate times 40 for a work week (“Weekly Rate”); or (b) in the case of an Involuntary Termination (as defined herein):  the greater of (i) your highest Weekly Salary or Weekly Rate, as applicable, at any time during the Transaction Protection Period (as defined herein), and (ii) your Weekly Salary or Weekly Rate, as applicable, at the time you received your notice of termination.  Base pay does not include any variable forms of compensation such as, but not limited to, overtime, shift differentials, bonuses, incentive compensation, commissions, expenses or expense allowances.

 

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“Change in Control” means the event of a change in ownership or control of United Online, Inc. affected through either of the following transactions:

 

(i)                                     the acquisition, directly or indirectly, by any person or related group of persons (other than United Online, Inc. or a person that directly or indirectly controls, is controlled by, or is under common control with, United Online, Inc.) of beneficial ownership (within the meaning of Rule 13d-3 of the Securities Exchange Act of 1934, as amended) of securities possessing more than fifty percent (50%) of the total combined voting power of the outstanding securities of United Online, Inc. pursuant to a tender or exchange offer made directly to the stockholders of United Online, Inc., or

 

(ii)                                  a change in the composition of the Board of Directors of United Online, Inc. (“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 elected 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 election or nomination.

 

“Code” means the Internal Revenue Code of 1986, as amended from time to time.

 

“Corporate Transaction” means either of the following stockholder-approved transactions to which United Online, Inc. is a party:

 

(i)                                     a merger or consolidation in which the record and beneficial ownership of securities possessing more than fifty percent (50%) of the total combined voting power of the outstanding securities of United Online, Inc. are transferred, both beneficially and of record, to a person or persons different from the persons holding those securities immediately prior to such transaction (for example, it will not be a Corporate Transaction if following the transaction United Online, Inc. is directly or indirectly (including through a parent or one or more subsidiaries) controlled by the person or persons who controlled 50% of the outstanding securities of United Online, Inc. prior to such transaction), or

 

(ii)                                  the sale, transfer or other disposition of all or substantially all of the assets of United Online, Inc. resulting in the complete liquidation or dissolution of United Online, Inc.

 

“Covered Subsidiary” means any subsidiary listed in attached Schedule A, as such schedule may be revised from time to time, as a participating Employer in the Plan.

 

“Employer Group” means the Company and each member of the group of commonly controlled corporations or other businesses that include the Company, as determined in accordance with Sections 414(b) and (c) of the Code and the Treasury Regulations thereunder, except that in applying Sections 1563(1), (2) and (3) of the Code for purposes of determining the controlled group of corporations under Section 414(b), the phrase “at least 50 percent” shall be used instead of “at least 80 percent” each place the latter phrase appears in such sections and in applying Section 1.414(c)-2 of the Treasury Regulations for purposes of determining trades or businesses that are under common control for purposes of Section 414(c), the phrase “at least 50 percent” shall be used instead of “at least 80 percent” each place the latter phrase appears in Section 1.414(c)-2 of the Treasury Regulations.

 

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“Involuntary Termination” or “Involuntarily Terminated” means the following: (i) you are terminated by the Company or any successor to the Company or any Covered Subsidiary for reasons other than Misconduct (as defined below) during the Transaction Protection Period or (ii) your employment terminates as a result of a Resignation for Good Reason during the Transaction Protection Period.  Unless otherwise determined by the Chief Executive Officer of United Online, Inc., the Involuntary Termination provisions of the Plan shall only apply in the event of a Change in Control or Corporate Transaction with respect to United Online, Inc.

 

“Misconduct” means the (i) commission of any act of fraud, embezzlement or dishonesty, (ii) any unauthorized use or disclosure of confidential information or trade secrets of the Company (or any other member of the Employer Group), (iii) any intentional misconduct adversely affecting the business or affairs of the Company (or any other member of the Employer Group), or (iv) failure to use reasonable efforts to follow reasonable directives or instructions of a manager or supervisor after written notice of such failure that specifies in detail the reasons for such failure and a chance to remedy such failure.

 

“Plan Administrator” means the Compensation Committee of the Board of Directors of the Company or any other committee appointed by the Board of Directors to perform the functions of the Compensation Committee (the “Committee”) or any person, committee or entity to whom or which the Committee delegates any of its power or duties under the Plan from time to time.

 

“Resignation for Good Reason” means the termination of your employment during the Transaction Protection Period as a result of your resignation for either of the following reasons: (A) a material reduction in the amount of base salary in effect for you immediately prior to the commencement of the Transaction Protection Period or (B) a relocation of your primary place of employment by more than fifty (50) miles; provided, however, that your resignation for either of the foregoing reasons shall constitute a Resignation for Good Reason only if the following requirements are satisfied: (i) you provide written notice of the clause (A) or (B) event to your Employer within thirty (30) days after the occurrence of that event, (ii) your Employer fails to take appropriate remedial action to remedy such event within thirty (30) days after receipt of such notice and (iii) you resign from your employment with such Employer within ninety (90) days following the initial occurrence of the clause (A) or (B) event.

 

“Separation from Service” means your cessation of employment with your Employer (as defined herein) and all other members of the Employer Group and shall be deemed to occur at such time as the level of bona fide services you are render as such an employee (or non-employee consultant) permanently decreases to a level that is not more than twenty percent (20%) of the average level of services you rendered as an employee of the Company or any other member of the Employer Group during the immediately preceding thirty-six (36) months (or such shorter period of time in which your have been in such employee status). Any such determination, however, shall be made in accordance with the applicable standards of the Treasury Regulations issued under Internal Revenue Code Section 409A.

 

“Transaction” means a Change in Control or a Corporate Transaction, as such terms are defined herein.

 

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“Transaction Protection Period” means the period beginning with the closing date of the Transaction and ending upon the expiration date of the eighteen (18)-month period measured from such closing date.

 

III.                              ELIGIBILITY

 

A.                   Eligibility Criteria.

 

You generally  are  eligible for benefits under the Plan if you satisfy all of the following conditions:

 

1.                                      You are a full-time U.S. employee of the Company or any subsidiary thereof listed in attached Schedule A, with the company for which you are such a full-time employee to be designated your “Employer” for purposes of the Plan.

 

2.                                      You are either (i) notified while the Plan is in effect that, as a result of a reduction-in-force decision by your Employer that eliminates your position, your employment is terminated (“Layoff Termination”), or (ii) Involuntarily Terminated during the Transaction Protection Period.

 

3.                                      You are not offered an alternate position with the Company or other Employer within fifty (50) miles of either your residence or your most recent work place; provided, however, that this condition will not be required during the Transaction Protection Period.

 

4.                                      Prior to your employment termination date, you have signed a form of confidential/proprietary/trade secret information, non-disclosure and inventions assignment agreement(s) with the Company, a predecessor of the Company, or your Employer that covers the period of your employment with the Company (and/or with a predecessor of the Company) or any other member of the Employer Group and which also may include post-employment obligations concerning the confidential information of the Company and its subsidiaries.

 

5.                                      You have returned, on or within five (5) business days after your employment termination date, to your Employer all Company and Employer documents created and received by you during your employment (electronic and paper) with the exception only of your personal copies of documents evidencing your hire, termination, compensation, benefits and stock options, and any other documents you have received as a shareholder of the Company or any parent or subsidiary of the Company.

 

6.                                      If you previously received an advance(s) for business travel and entertainment expenses, (i) you have properly completed and submitted an expense reimbursement form(s) and supporting receipts to your manager within fifteen (15) days after your Layoff Termination or Involuntary Termination, (ii) your manager has approved your expenses, and (iii) you have repaid within that fifteen (15)-day period (via check payable to “United Online, Inc.”) any amount advanced but not used.

 

7.                                      On or before your employment termination date, you have met with your manager and: (i) you have transitioned your work and information concerning your work to your manager; and (ii) you have provided your manager with all passwords and passcodes you have created for documents, email and electronic files that you created or used on Company’s computers and computer systems.

 

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

 

9.                                      You have signed a general release of all claims in a form acceptable to the Company (the “Required Release”) and delivered it to your Employer in accordance with following requirements:

 

·                  if you are under age forty (40), then (i) you must sign the Required Release and deliver it to your Employer within ten (10) business days (or such shorter  period of time required by your Employer) after the date of your Layoff Termination or Involuntary Termination and (ii) such Required Release must become effective after the expiration of any revocation period applicable by law or regulation to that release.

 

·                  If you are age forty (40) or older, then (i) you must sign the Required Release and deliver it to your Employer within twenty-one  (21) days (or forty-five (45) days if required by applicable law) after the date of your Layoff Termination or Involuntary Termination and (ii) such Required Release must become effective after the expiration of any revocation period applicable by law or regulation to that release.

 

10.                               You are not in one of the excluded categories listed below.

 

B.                   Criteria for Exclusion from Eligibility.

 

You  are  not eligible for severance benefits under this Plan if any of the following apply:

 

1.                                      You are a temporary, leased or seasonal employee of the Company or any Covered Subsidiary.

 

2.                                      You work for the Company or any Covered Subsidiary as an independent contractor, consultant, or agent under a written contract or purchase order or you are otherwise classified as such by your Employer (whether or not such classification is upheld on governmental, judicial or other review.)

 

3.                                      You resign your employment with the Company or any Covered Subsidiary (other than a resignation constituting an Involuntary Termination).

 

4.                                      You terminate your employment prior to the date of termination set by your Employer in its notice of termination (other than in instances involving Involuntary Termination during the Transaction Protection Period). Your Employer has sole discretion to select your termination date in circumstances not involving an Involuntary Termination during the Transaction Protection Period, and failure to work through the termination date may render you ineligible for severance benefits.  Vacation may be taken between the date you receive notice of termination and your termination date only with the prior written approval of senior management.

 

5.                                      You are terminated for reasons unrelated to an economically motivated reduction in force and under circumstances that do not constitute an Involuntary Termination.

 

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6.                                      In situations other than an Involuntary Termination during the Transaction Protection Period, you are terminated for unsatisfactory performance, negligence in performance of your duties, misconduct, or violation of a policy of the Company or any other of your Employers.

 

7.                                      In situations other than an Involuntary Termination during the Transaction Protection Period, you are dismissed prior to the effective date of your Layoff Termination for a reason other than your Layoff Termination (including, but not limited to, any reason such as unsatisfactory performance, violation of applicable company policy or procedures, insubordination, misconduct, or the unauthorized use or disclosure of confidential information or trade secrets of the Company or any parent or subsidiary of the Company), whether or not you already received notice of your Layoff Termination that would otherwise qualify you for severance benefits under this Plan.

 

8.                                      In situations other than an Involuntary Termination during the Transaction Protection Period, you are offered comparable employment by a company or entity that acquires, merges with, acquires some or all of the assets of, or otherwise carries on the business of the Company or other Employer relating to your employment.  For purposes of this provision “comparable employment” means employment within 50 miles of your prior employment site and at least 100% of your prior base pay.

 

9.                                      Your termination results from long-term or permanent disability that renders you unable to perform your essential job functions even with accommodation or your death.

 

10.                               You are covered by any other written severance or separation pay plan or arrangement with the Company, or any subsidiary of the Company, or by an employment or other agreement with the Company or any subsidiary of the Company that provides for severance or separation pay/benefits in a lump sum or in installment payments following termination of your employment.

 

11.                               The Plan Administrator determines, in its sole discretion, that your receipt of severance benefits would not under the circumstances further the purposes of the Plan or would otherwise be inappropriate and not in the best interests of the Company, provided, however, that this provision shall not apply during the Transaction Protection Period.

 

IV.                               HOW THE PLAN WORKS

 

A.            Payment Date of Severance Benefits

 

If you satisfy all the eligibility criteria of Section III and are eligible for benefits under the Plan, you will receive your separation benefits (the “Severance Payment Benefit”), in the amount determined pursuant to Section IV.B. below, in a lump sum payment on the third business day, within the sixty (60)-day period measured from the date of your Separation from Service due to your Layoff Termination or Involuntary Termination, following the date on which your Required Release first becomes effective and enforceable following the expiration of the applicable  revocation period and you have otherwise complied with all the other terms and conditions of Section III.A; provided, however, that should the sixty (60)-day period measured from the date of your Separation from Service span two (2) taxable years, then the Severance Payment Benefit shall not be paid until the first business day in the second taxable year on which your

 

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Required Release is effective and enforceable following the expiration of the applicable revocation period and you have otherwise complied with all the other terms and conditions of Section III.A, but in no event later the last business day of such sixty (60)-day period provided the foregoing requirements have been satisfied.  If the foregoing requirements are not satisfied prior to the expiration of such sixty (60)-day period, then you will not be entitled to any Severance Payment Benefit under the Plan.

 

B.                   Severance Benefits Guidelines

 

The Severance Payment Benefit for which you are eligible under the Plan depends on your position, your base pay, your length of service, the type of termination, and whether you are entitled to receive prior notice of your termination under the terms of the Worker Adjustment and Retraining Notification Act (“WARN Act”).  No Severance Payment Benefit will be paid to you if you fail to comply with or meet the eligibility conditions stated above, including (without limitation) the execution and effectiveness of the Required Release on or before applicable date specified in Section III.A.9. above, but in no event after the expiration of the sixty (60)-day period measured from the date of your Separation from Service.

 

The actual Severance Payment Benefit for which you are eligible generally will be determined in accordance with the guidelines set forth below.

 

1.                                      Severance Payment Benefit Guideline for Employees Not Entitled to WARN Act Notice:  If you are not entitled to advance notice of your termination pursuant to the provisions of the WARN Act, this section will serve as your Severance Payment Benefit guideline.

 

(a)                                 For employees other than Presidents, Executive Vice Presidents, Senior Vice Presidents or Vice Presidents, the Severance Payment Benefit shall depend on whether you are terminated during the Transaction Protection Period as follows:

 

(i)                                     For a termination that does not occur during the Transaction Protection Period, the Severance Payment Benefit for employees who are not entitled to prior notice of layoff under the WARN Act is one week’s base pay for each full $20,000 of annual base pay, and an additional one week’s base pay for each full six (6) month period of employment completed prior to termination, up to a maximum of an additional five (5) weeks of base pay.  For example, an employee with a $40,000 per year base salary who has been employed continuously for four years would be eligible for a severance benefit equal to seven (7) weeks of base pay.

 

(ii)                                  For a termination that occurs during the Transaction Protection Period, the severance benefit for employees who are not entitled to prior notice of layoff under the WARN Act is one week’s base pay for each full $10,000 of annual base pay which the employee was receiving prior to the Transaction (or, if greater, the base pay such employee was receiving before the termination) and an additional one week’s base pay for each full six (6) month period of employment completed prior to termination, up to an additional five (5) weeks of base pay.  For example, an employee with a $40,000 per year base salary who has been employed continuously for four years would be eligible for a severance benefit equal to nine (9) weeks of base pay.

 

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(b)                                 The Severance Payment Benefit amount for Presidents and Executive Vice Presidents shall be one year of base pay. The Severance Payment Benefit amount for Senior Vice Presidents and Vice Presidents shall be six (6) months of base pay.  The amounts for Presidents, Executive Vice Presidents, Senior Vice Presidents and Vice Presidents shall apply whether or not the termination occurs during the Transaction Protection Period.  Whether an employee is a President, Executive Vice President, Senior Vice President or Vice President will be based upon such employee’s title as of the date of termination or, if during the Transaction Protection Period, the employee’s highest title at any time during that period. It shall be solely in the Company’s discretion to change employees’ titles.

 

2.                                      Severance Payment Benefit Guideline for Employees Entitled to Notice Under the WARN Act.  If you are entitled to prior notice of your termination pursuant to the provisions of the WARN Act, the Severance Payment Benefit guideline is as follows:  The Severance Payment Benefit amount is the greater of (a) the amount for which you would be eligible under Section IV.B.1. above (if you had not been entitled to WARN Act notice) minus eight weeks’ base pay, or (b) one week’s base pay.  For example, the benefit guideline for a person who has been employed for five years with a base salary of $100,000 who is not terminated during the Transaction Protection Period would be two weeks’ base pay.  The benefit guideline for a person who has been employed for three years with a base salary of $60,000 would be one week’s base pay.

 

3.                                      Payment of Benefits.  The lump sum payment of the Severance Payment Benefit determined in accordance with the provisions of this Section IV.B. will be subject to legally required tax withholdings and all other applicable payroll deductions.  Such withholdings and deductions may not include 401k Plan contributions or other elective benefit and benefit plan contributions as participation in such benefits and plans terminate upon termination of employment.

 

4.                                      Administrator Discretion.  The Plan Administrator may, as it deems appropriate and in its sole discretion, authorize Severance Payment Benefits in an amount different from that set forth in the Severance Payment Benefit Guidelines.  Under certain circumstances, the Plan Administrator may, in its sole discretion, waive or modify, with respect to one or more employees or classes of employees, the eligibility requirements for Severance Payment Benefits or modify the amount of Severance Payment Benefits.  The foregoing shall not apply during the Transaction Protection Period.  In no event, however, shall any Severance Payment Benefit payments be structured in a manner, or shall the Plan Administrator take any other action, that would contravene the applicable requirements, restrictions and limitations of Code Section 409A and the Treasury Regulations thereunder or otherwise result in a prohibited acceleration, or impermissible deferral, of benefit payments under Code Section 409A and the Treasury Regulations thereunder.

 

6.                                      Miscellaneous.  Regardless of whether you meet the eligibility criteria of Section III and are eligible for benefits under the Plan, you will be subject to the following rights and obligations in connection with your Layoff Termination or Involuntary Termination:

 

·                  In your final paycheck, you will receive a lump sum payment for your salary or wages through your termination date, and all your accrued but unused vacation.

 

·                  As of the effective date of your Layoff Termination, except as otherwise provided through COBRA, you will cease participation in all employee benefits and benefit plans the Company makes available to its employees, in accordance with the terms and conditions of such benefits and benefit plans.

 

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·                  In accordance with COBRA, you and/or your eligible dependents may elect temporary continuation coverage under the Company’s group health benefit plans (medical, dental and/or vision), provided that you timely elect such coverage and you timely pay the full amount of premiums due.  In connection with your Layoff Termination, you and your eligible dependents will be provided with COBRA election forms and a notice that describes your rights to, and the terms and conditions of, temporary continuation coverage under COBRA.  These documents will be provided separately.

 

·                  During the limited post-employment exercise period and pursuant to the procedures specified in the applicable stock option agreement(s), you may exercise any outstanding stock options that vested on or prior to the effective date of your Layoff Termination.

 

·                  You will receive information describing unemployment insurance benefits separately.

 

V.                                    OTHER IMPORTANT INFORMATION

 

A.                    Plan Administration.  The Plan Administrator has full discretionary authority to administer and interpret the Plan, including discretionary authority to determine eligibility for participation and for benefits under the Plan, the amount of benefits (if any) payable per participant, and to interpret terms of the Plan; provided, however, that the Plan Administrator shall not have discretion to change the severance amount or payment terms during the Transaction Protection Period.  The Plan Administrator may delegate any or all of its duties to Company personnel.  Any such delegation will carry with it the full discretionary authority of the Plan Administrator to carry out the delegated duties.  Any determination by the Plan Administrator or its delegate will be final and conclusive upon all persons.  The Company will indemnify and hold harmless any person to whom it delegates its responsibilities; provided, however, such person does not act with gross negligence or willful misconduct.

 

It is the intention of the Company and the other Employers that this Plan continues to 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 Plan 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.

 

B.                   Benefits.  All benefits will be paid from the general assets of the Company.  The Company is not required to and will not establish a trust to fund the Plan.  The benefits provided under this Plan are not assignable and may be conditioned upon your compliance with any confidentiality agreement you have entered into with the Company or upon your compliance with any Company policy or program.  The payment of benefits under this Plan does not increase the benefits due to you under any other benefit plan or Company policy.

 

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C.                            Claims Procedure.

 

1.                                      Application for Benefits.  If you believe you are incorrectly denied a benefit or are entitled to a greater benefit than the benefit you receive under the Plan, you may submit a signed, written application to the Chief Personnel Officer of the Company within ninety (90) days after the effective date of your Layoff Termination or Involuntary Termination.

 

2.                                      Denial of Application for Benefits.  In the event that your application for benefits is denied in whole or in part, the Plan Administrator must notify you, in writing, of the denial of the application, and of your right to review the denial.  The written notice of denial will be set forth in a manner designed to be understood by you, and will include specific reasons for the denial, specific references to the Plan provision upon which the denial is based, a description of any information or material that the Plan Administrator needs to complete the review and an explanation of the Plan’s review procedure.  This written notice will be given to you within ninety (90) days after the Plan Administrator receives the application, unless special circumstances require an extension of time, in which case, the Plan Administrator has up to an additional ninety (90) days for processing the application.  If an extension of time for processing is required, written notice of the extension will be furnished to you before the end of the initial ninety (90) day period.  This notice of extension will describe the special circumstances necessitating the additional time and the date by which the Plan Administrator is to render its decision on the application.  If written notice of denial of the application for benefits is not furnished within the specified time, the application shall be deemed to be denied.  You will then be permitted to appeal the denial in accordance with the review procedure described below.

 

3.                                      Request for Review.  If your application for benefits is denied (or deemed denied), in whole or in part, you (or your authorized representative) may appeal the denial by submitting a request for a review to the Chief Personnel Officer of the Company within sixty (60) days after the application is denied (or deemed denied).  The Plan Administrator will give you (or your representative) an opportunity to review pertinent documents in preparing a request for a review.  A request for a review shall be in writing.  A request for review must set forth all of the grounds on which it is based, all facts in support of the request and any other matters that you feel are pertinent.  The Plan Administrator may require you to submit additional facts, documents or other material as it may find necessary or appropriate in making its review.

 

4.                                      Decision on Review.  The Plan Administrator will act on each request for review within sixty (60) days after receipt of the request, unless special circumstances require an extension of time (not to exceed an additional 60 days) for processing the request for a review.  If an extension for review is required, written notice of the extension will be furnished to you within the initial sixty (60) day period.  The Plan Administrator will give prompt, written notice of its decision to you.  In the event that the Plan Administrator confirms the denial of the application for benefits in whole or in part, the notice will outline, in a manner calculated to be understood by you, the specific reasons for the decision and the Plan provisions upon which the decision is based.  If written notice of the Plan Administrator’s decision is not given to you within the time prescribed in this subsection (4), the application will be deemed denied on review.

 

5.                                      Exhaustion of Remedies.  No legal action for benefits under the Plan may be brought until: (i) you have submitted a written application for benefits in accordance with the procedures described by Section V.C.1., above; (ii) you have been notified by the Plan Administrator that the application is denied (or the application is deemed denied due to the Plan Administrator’s failure to act on it within the established time period);  (iii) you have filed a written request for a review of the application in accordance with the appeal procedure described in

 

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Section V.C.3., above;  and (iv) you have been notified in writing that the Plan Administrator has denied the appeal (or the appeal is deemed to be denied due to the Plan Administrator’s failure to take any action on the claim within the time prescribed by Section V.C.4., above).

 

 

D.                   Plan Terms.  This Plan supersedes any and all prior separation, severance and salary continuation arrangements, programs and plans which were previously offered by the Company to eligible employees of this Plan, except such terms as are set forth in a written agreement signed by an authorized officer of the Company or any subsidiary of the Company.  This policy supplements any such written agreements to provide all terms that are not otherwise expressly set forth in those written agreement.

 

E.                     Plan Amendment or Termination.  The Compensation Committee of the Company reserves the right to change, suspend, discontinue or terminate all or any part of this Plan at any time; provided, however, that the Plan may not be amended, modified or terminated during the Transaction Protection Period with respect to eligible employees under the Plan as of the closing of that Transaction.  Other than during the Transaction Protection Period with respect to eligible employees as of the closing of that Transaction, the provisions of the Plan are intended to serve as mere guidelines for the payment of benefits under certain prescribed circumstances and are not intended to provide any employee with a vested right to benefits.  Accordingly, any termination or amendment of the Plan may be made effective immediately with respect to any benefits not yet paid, whether or not prior notice of such amendment or termination has been given to affected employees.  This Plan terminates by its own terms when all benefits hereunder have been paid.

 

F.                          Taxes and Other Payroll Deductions.  Company will withhold taxes and all other applicable payroll deductions from any Severance Payment Benefit made under this Plan.  The Company may also offset from any Severance Payment Benefit any amounts owed to the Company, except to the extent such offset would contravene any applicable restrictions or limitations under Code Section 409A.

 

G.                   No Right to Employment.  No provision of this Plan is intended to provide you or any other employee with any right to continue employment with Company or any other member of the Employer Group or otherwise affect the right of the Company or any other member of the Employer Group, which right is hereby expressly reserved, to terminate the employment of any individual at any time for any reason, without cause.

 

VI.                                STATEMENT OF ERISA RIGHTS

 

As a participant in the United Online, Inc. Severance Benefit Plan (the “Plan”), you are entitled to certain rights and protections under the Employment Retirement Income Security Act of 1974, as amended (“ERISA”).  ERISA provides that all Plan participants shall be entitled to:

 

1.               Examine, without charge, at the Plan Administrator’s office, all Plan documents, including all documents filed by the Plan with the U.S. Department of Labor, such as plan descriptions.

 

2.               Obtain copies of all Plan documents and other Plan information upon written request to the Plan Administrator.  The Plan Administrator may make a reasonable charge for the copies.

 

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In addition to creating rights for certain employees of the Company under the Plan, ERISA imposes obligations upon the people who are responsible for the operation of the Plan.  The people who operate the Plan (called “fiduciaries”) have a duty to do so prudently and in the interest of the Company’s employees who are covered by the Plan.

 

No one, including your Employer or any other person, may terminate your employment or otherwise discriminate against you in any way to prevent you from obtaining a benefit to which you are entitled under the Plan or from exercising your rights under ERISA.

 

If your claim for a benefit under this Plan is denied in whole or in part, you must receive a written explanation of the reason for the denial.  You have the right to have the Plan Administrator review and reconsider your claim.  Under ERISA, there are steps you can take to enforce the above rights.  For instance, if you request materials from the Plan and do not receive them within thirty (30) days, you may file suit in a federal court.  In such a case, the court may require the Plan Administrator to provide the materials and pay you up to $110 a day until you receive the materials, unless the materials were not sent because of reasons beyond the control of the Plan Administrator.  If you have a claim for a benefit under this Plan that is denied or ignored, in whole or in part, you may file suit in a federal or a state court.  If it should happen that the Plan fiduciaries misuse the Plan’s assets (if any) or if you are discriminated against for asserting your rights, you may seek assistance from the U.S. Department of Labor or you may file suit in a federal court.  The court will decide who should pay court costs and legal fees.  If you are successful in your lawsuit, the court may order the party you have sued to pay your legal costs, including attorney fees.  However, if you lose, the court may order you to pay these costs and fees, for example, if it finds that your claim or suit is frivolous.

 

If you have any questions about the Plan, this statement or your rights under ERISA, you should contact the Plan Administrator or the nearest Area Office of the Pension and Welfare Benefits Administration, U.S. Department of Labor, listed in your local telephone directory or contact the Division of Technical Assistance and Inquiries, Pension and Welfare Benefits Administration, U.S. Department of Labor, 200 Constitution Avenue N.W., Washington, D.C. 20210.

 

13

 

ADDITIONAL PLAN INFORMATION

 

	
Plan Sponsor:
    	
 
    	
United Online, Inc.
    
	
 
    	
 
    	
 
    
	
Plan   Name:
    	
 
    	
The   United Online, Inc. Severance Benefit Plan
    
	
 
    	
 
    	
 
    
	
Employer   Identification Number
    	
 
    	
77-0575839
    
	
 
    	
 
    	
 
    
	
Plan   Number:
    	
 
    	
5   01
    
	
 
    	
 
    	
 
    
	
Plan   Effective Date:
    	
 
    	
January 1,   2010
    
	
 
    	
 
    	
 
    
	
Plan   Administrator:
    	
 
    	
United   Online, Inc. 
   21301 Burbank Blvd.
   Woodland Hills, CA 91367
   Telephone: (818) 287-3000
    
	
 
    	
 
    	
 
    
	
Direct   Inquiries to:
    	
 
    	
Plan   Administrator
   c/o General Counsel
   United Online, Inc.
   21301 Burbank Blvd.
   Woodland Hills, CA 91367
   Telephone: (818) 287-3000
    
	
 
    	
 
    	
 
    
	
Agent   for Service of Legal Process:
    	
 
    	
Plan   Administrator or
   United Online’s Executive Vice President and
   General Counsel
    
	
 
    	
 
    	
 
    
	
Type   of Plan:
    	
 
    	
Severance   Plan / Employee Welfare Benefit Plan
    
	
 
    	
 
    	
 
    
	
Plan   Costs:
    	
 
    	
The   cost of the plan is paid by United Online, Inc.
    

 

14

 

IN WITNESS WHEREOF, UNITED ONLINE, INC. HAS CAUSED THIS AMENDED AND RESTATED SEVERANCE BENEFIT PLAN AND SUMMARY PLAN DESCRIPTION TO BE EXECUTED ON ITS BEHALF BY ITS DULY AUTHORIZED OFFICER ON THE DATE AND YEAR INDICATED BELOW.

 

 

	
 
    	
UNITED   ONLINE, INC.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:   
    	
/s/   Mark R. Goldston
    
	
 
    	
 
    
	
 
    	
Title:    Chief Executive Officer
    
	
 
    	
 
    
	
 
    	
Dated:   April 11, 2011
    

 

 

SCHEDULE A

 

LIST OF COVERED SUBSIDIARIES PARTICIPATING IN THE PLAN

AS OF JANUARY 3, 2012

 

NetZero, Inc.

Juno Internet Services, Inc.

United Online Advertising Network, Inc.

Memory Lane, Inc. (formerly known as Classmates Online, Inc.)

MyPoints.com, Inc.

FTD.COM Inc.

Florists’ Transworld Delivery, Inc.

CMC Services, Inc.

 

16Exhibit 10.3

 

POST-EMPLOYMENT CONSULTING AGREEMENT

 

This Post-Employment Consulting Agreement (the “Agreement”) is executed on this 9th day of March 2012 by Frederic A. Randall, Jr. (“Consultant”) and United Online, Inc., a Delaware corporation (“Company”) to become effective March 16, 2012.

 

IN CONSIDERATION  FOR the mutual promises and covenants contained herein the parties to this Agreement hereby agree as follows:

 

1.             Termination of Employment.

 

(a)           Pursuant to his notice of resignation delivered to the Company on March 5, 2012, Consultant’s employment with the Company shall terminate on the March 16, 2012 (“Termination Date”) and Consultant will not perform any further duties or render any further services to the Company after such date, except for the limited consulting services to be provided pursuant to the terms of this Agreement.  Accordingly, on the Termination Date, Consultant shall incur a separation from service for purposes of Section 409A of the Internal Revenue Code of 1986, as amended (“Section 409A”).

 

(b)           Consultant hereby confirms and agrees that his resignation from the Company is entirely voluntary and is not due to any event or transaction that would constitute grounds for a good reason resignation or involuntary termination pursuant to the terms of his Employment Agreement with the Company dated February 7, 2011 (“Employment Agreement”).

 

(c)           Notwithstanding any provision to the contrary in any of the award agreements evidencing the equity awards Consultant has received to date from the Company, Consultant shall, as of the close of business on the Termination Date, cease to vest in any additional shares of the Company’s stock under any of his outstanding stock options or restricted stock unit awards from the Company, and Consultant shall not vest in any additional shares of the Company’s common stock under those awards by reason of the consulting services he is to render pursuant to this Agreement.  Consultant shall have a limited three (3)-month period measured from the Termination Date in which to exercise any of his outstanding stock options that are vested on that date.  Upon the expiration of that 3-month period (or any other earlier expiration date of any of his outstanding options), those options shall terminate, and Consultant shall cease to have any further right to acquire shares of the Company’s stock under those options.

 

(d)           To the extent Consultant is vested on the Termination Date in any outstanding restricted stock unit award, the shares of the Company’s stock subject to the vested portion of that award shall be issued to him in accordance with the issuance provisions in effect for that award under the applicable award agreement.  Consultant’s separation from service on the Termination Date shall not result in any acceleration of the issuance dates for those vested

 

 

shares.  To the extent Consultant is not vested on the Termination Date in any outstanding restricted stock unit award he has received from the Company, that award will be cancelled at that time, and Consultant shall cease to have any further right or entitlement to receive any shares of the Company’s stock under such cancelled award.

 

2.             Consulting Services.

 

(a)           Consultant shall during the one-year period commencing March 16, 2012 and ending March 15, 2013 (the “Consultancy Period”) render to the Company such consulting and advisory services as may be requested from time to time by the Chief Executive Officer of the Company, up to a maximum of twenty-five (25) hours of consulting services during each of the twelve (12) separate one-month periods comprising the Consultancy Period.  In no event shall Consultant perform services under this Agreement at a level that is twenty percent (20%) or greater than the level of services performed by him over the 36-month period ending on the Termination Date.  In his consulting capacity, Consultant shall provide advice and assistance with respect to the formulation and implementation of key strategic objectives for the Company and render such other services as may be reasonably requested of him from time to time during the Consultancy Period.  Consultant shall be available by telephone, e-mail or in person as required to provide the necessary advice and assistance.

 

(b)           While on the Company’s premises, Consultant shall comply with the Company’s then-current access rules and procedures, including those rules and procedures pertaining to safety, information technology systems, security, and confidentiality.

 

(c)           Consultant will perform all services required of him pursuant to this Agreement: (i) in a professional manner consistent with industry standards; (ii) in accordance with the standard of care customarily observed with regard to such services in Consultant’s field of expertise; and (iii) in compliance with all applicable laws, rules and regulations.

 

(d)           Should Consultant fail to comply with the requirements of this Paragraph 2 or otherwise fail to render consulting services in a reasonably satisfactory manner, following written notice of such failure and a reasonable cure period, if such failure continues, the Company shall have the right to terminate this Agreement and the related Consultancy Period upon three (3) days prior written notice to Consultant, and Consultant shall on such termination date cease to be entitled to any further compensation under this Agreement other than any compensation earned but unpaid hereunder as of such date.

 

3.             Compensation for Consulting Services.  Provided Consultant complies with the terms, conditions and restrictions of this Agreement, he shall be entitled to compensation in accordance with the following terms and conditions:

 

(a)           For each full or partial month for which Consultant remains available to provide services to the Company pursuant to this Agreement, Consultant shall be compensated at the appropriate rate for that period based on a total compensation amount of $461,800 for the full twelve (12)-month Consultancy Period. Such compensation shall be paid in periodic increments over the Consultancy Period in accordance with the same payroll practices applicable to the Company’s full-time salaried employees.

 

2

 

(b)           As a non-employee independent contractor under this Agreement, Consultant shall be solely liable and responsible for the timely payment of all federal, state and local income taxes, including estimated tax payments, and all SECA (OASDI and Medicare) taxes on the self-employment income consultant realizes upon each periodic payment made to him under this Agreement, and the Company shall have no obligation to withhold any such taxes from those periodic payments. For each taxable year within the Consultancy Period, the Company shall issue a Form 1099 to Consultant indicating the amount of compensation paid to him for that year under this Agreement.

 

(c)           Notwithstanding any provision to the contrary in this Agreement, the final payment date for any compensation earned under this Agreement shall occur on March 15, 2013 so that all payments made under this Agreement shall qualify for the short-term deferral exception to Section 409A, with each payment hereunder to be treated as a separate payment for purposes of Section 409A.

 

4.             Reimbursement of Expenses.

 

(a)           The Company shall reimburse Consultant for all reasonable out-of-pocket expenses incurred by Consultant in providing the services required of him pursuant to this Agreement. Consultant must, as to each such expense for which Consultant seeks reimbursement, furnish detailed receipts and other valid documentation for within forty-five (45) calendar days following the later of (i) the date on which that expense is incurred or (ii) the date on which Consultant receives the invoice or billing statement for such expense for the incurred. The Company shall provide Consultant with the requisite reimbursement within thirty (30) business days thereafter; and in no event will any expense be reimbursed later than the close of the calendar year following the calendar year in which that expense is incurred. In addition, the following provisions shall apply to such reimbursement arrangement: (i)  the amount of expenses eligible for reimbursement in any one calendar year will not affect the amount of expenses eligible for reimbursement in any other calendar year for which such reimbursement is to be provided hereunder; and (ii) Consultant’s right to the reimbursement of such expenses cannot be liquidated or exchanged for any other benefit.

 

(b)           Notwithstanding the foregoing, the Company shall in no event reimburse Consultant for any expenses that exceed $2,500 in any one instance or $7,500 in the aggregate unless Consultant obtains the Company’s written authorization of those expenses prior to the incurrence of those expenses. Consultant further acknowledges and agrees that the Company may be required to report to government entities all fees and expenses paid to Consultant under this Agreement, and Consultant shall, accordingly, to provide, at the Company’s reasonable request, any information necessary for the Company to make any such required report.

 

5.             Return of Company Property.  Consultant shall, within seven (7) days after the Termination Date, return to the Company all Company documents, information, and property, including files, records, computer access codes, and instruction manuals, as well as any Company assets or equipment that Consultant has in his possession or under his control (collectively, the “Company Property”), except for such Company Property as is reasonably necessary for Consultant to provide the consulting services under this Agreement.  Consultant agrees not to keep any copies of the Company Property or any other Company documents or

 

3

 

information.  Consultant affirms his obligation to keep all Company Information confidential and not to disclose it to any third party in the future.  Consultant understands that the term “Company Information” includes, but is not limited to, the following: (a) confidential information, including information received from third parties under confidential conditions; and (b) information concerning customers (including customer lists), as well as other technical, scientific, marketing, business, product development, or financial information, the use or disclosure of which might reasonably be determined to be contrary to the interests of the Company.

 

6.             Reimbursement of Employee Expenses. Consultant shall, within thirty (30) days after the Termination Date, submit his final documented expense reimbursement statement reflecting all business expense Consultant incurred through the Termination Date for which he seeks reimbursement.  Consultant acknowledges that his failure to submit such a statement within this time period will result in his waiver of any right to be reimbursed by the Company for any such expenses.  The Company will reimburse Consultant for any such expenses for which he submits such timely documentation within seven (7) business days after such submission.

 

7.             Co-operation  Consultant shall cooperate and assist the Company (including making himself available at reasonable times and places) so as to aid the Company in connection with any matters related to his past employment by the Company or about which Consultant is knowledgeable, provided that his cooperation with such matters shall not interfere unreasonably with his subsequent employment, if any. In addition, Consultant shall be available and cooperate with the Company and/or its attorneys with respect to any investigation, litigation, or administrative, judicial or other proceeding where the Company believes he may have knowledge or information that may be relevant to such investigation or proceeding.  Consultant understands that the Company will reimburse him for reasonable out-of-pocket expenses incurred by him with the Company’s authorization as a result of his cooperation with the Company in connection therewith.

 

8.             Proprietary Information.

 

(a)           Consultant acknowledges that due to the position that he has occupied as an officer and employee of the Company and the responsibilities he has performed in that capacity, Consultant has received confidential information, including attorney-client privileged information as well as information concerning the Company’s procedures, customers, customer lists sales, prices, contracts, and the like as well as other technical, scientific, marketing, business, product development, and financial information.  Consultant further acknowledges that he will continue to have access to such confidential information during the Consultancy Period. Consultant hereby agrees to keep all such information confidential, and he promises and agrees that, unless compelled by legal process, he will not disclose to others and will keep confidential all information he has received, while employed by the Company or while serving as a consultant during the Consultancy Period, concerning the Company’s strategies, privileged communications, products and procedures, the identities of the Company’s customers, the Company’s sales, the Company’s prices, the terms of any of the Company’s contracts with third parties, and the like that have been maintained in confidence by the Company, Consultant agrees

 

4

 

that a violation by him of the foregoing obligation to maintain the confidentiality of the Company’s confidential information will constitute a material breach of this Agreement.

 

(b)           Consultant shall, within seven (7) days after the expiration date of the Consultancy Period, return to the Company all Company documents, information, and property, including files, records, computer access codes, and instruction manuals, as well as any Company assets or equipment, that may have come into Consultant’s possession or under his control during the Consultancy Period.  Consultant agrees not to keep any copies of such documents, information or other property following the expiration of the Consultancy Period.

 

(c)           Consultant specifically confirms that he will continue to comply with the terms of the proprietary information and inventions agreement that he signed with respect to the Company and that the proprietary information agreement will survive this Agreement and remain in full force and effect in accordance with its terms.

 

9.             Nature of Relationship.

 

(a)           Nothing in this Agreement shall be interpreted or construed as continuing any employment relationship between Consultant and the Company during the Consultancy Period.  Accordingly, Consultant shall not represent himself as an officer, employee or agent of the Company to any third party, and Consultant’s services under this Agreement shall be rendered solely as a non-employee independent contractor.

 

(b)           Without limiting the generality of the foregoing, Consultant hereby agrees and confirms that during the Consultancy Period, he will not be entitled to participate in any employee benefit plans, policies or programs of the Company, including (without limitation) group term life insurance or group health benefit plans, workers’ compensation, disability insurance, vacation, sick pay, profit-sharing, cash incentive plans (such as the annual management bonus plan), the Employee Stock Purchase Plan, stock option or other stock-based compensation plans, retirement benefits or 401(k) plan; provided, however, that Consultant may elect to continue coverage for himself and other eligible family members under the Company’s group health benefit plan pursuant to his COBRA rights as a former employee of the Company, but such continued coverage shall be at Consultant’s sole cost and expense.

 

10.          Termination of Agreement.

 

(a)           In the event that Consultant breaches any of his obligations under this Agreement, the Company shall have the right, exercisable in its sole discretion, following written notice of such breach and a reasonable cure period if such breach is capable of being cured, and if such breach continues or is not cured, to terminate this Agreement and the related Consultancy Period upon three (3) days prior written notice to Consultant.

 

(b)           Consultant may terminate the Consultancy Period at any time upon three (3) days prior written notice to the Company.

 

(c)           Should this Agreement and the related Consultancy Period be terminated pursuant to the provisions of Paragraph 10(a) or 10(b) above, then Consultant shall on such

 

5

 

termination date cease to be entitled to any further compensation under this Agreement other than any earned but unpaid compensation hereunder as of such date.

 

(d)           Unless sooner terminated in accordance with the foregoing provisions of this Paragraph 10, the consulting relationship established under this Agreement and the related Consultancy Period shall terminate on March 15, 2013, and any amounts due and payable to Consultant at that time shall be paid to him on that date.

 

11.          Binding Agreement.  This Agreement shall be binding upon and inure to the benefit of the parties and the heirs, legal or personal representatives of Consultant and successors and assigns of the Company.

 

12.          Governing Law.  This Agreement is entered into in California and the laws of such State shall apply to it without resort to such State’s conflict-of-laws rules.

 

13.          Surviving Provisions.  The provisions of this Agreement that, by their nature or content, should reasonably be expected to continue beyond any termination or expiration of this Agreement, including, for the avoidance of doubt, Sections 3(b), 4, 5, 6, 7, 8, 9, 11, 12 and 13, shall survive the termination or expiration of this Agreement.

 

IN WITNESS WHEREOF, the parties have executed this Agreement on the day and year above written to become effective March 16, 2012.

 

 

	
 
    	
UNITED   ONLINE, INC.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Mark R. Goldston
    
	
 
    	
 
    	
Mark   R. Goldston
    
	
 
    	
 
    	
Chairman,   President and Chief Executive Officer
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
CONSULTANT
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
/s/   Frederic A. Randall, Jr.
    
	
 
    	
FREDERIC   A. RANDALL, JR.
    

 

6

 

GENERAL RELEASE

 

I, Frederic A. Randall, Jr., in consideration for the consulting relationship United Online, Inc. (“United Online”) has offered me following my voluntary resignation of employment with United Online effective March 16, 2012 (the “Termination Date”), do hereby agree to the following general release of all claims I may have against United Online and its affiliates designated below:

 

1.     On behalf of myself, my heirs, executors, administrators, successors, and assigns, I hereby fully and forever release and discharge United Online, its current, former, and future parents, subsidiaries, related entities, employee benefit plans, and their fiduciaries, predecessors, successors, officers, directors, shareholders, agents, employees, and assigns (collectively, the “Company”) from any and all claims, causes of action, and liabilities arising out of or relating in any way to my employment with the Company and the termination of such employment, including, but not limited to, the terms and conditions of my employment and my separation from such employment and good faith disputes regarding my wages and hours of work.

 

I understand and agree that this Release is a full and complete waiver and release of all claims, including, but not limited to, claims of wrongful discharge, breach of contract, breach of the covenant of good faith and fair dealing, wrongful termination, violation of public policy, defamation, personal injury, emotional distress, claims under the Age Discrimination in Employment Act, Title VII of the Civil Rights Act of 1964, the Americans with Disabilities Act, the Employee Retirement Income Security Act (except for claims for vested benefits under a pension or retirement plan), the Family and Medical Leave Act, the California Fair Employment and Housing Act, the Equal Pay Act of 1963, the Older Workers’ Benefit Protection Act, the Fair Labor Standards Act, the provisions of the California Labor Code, and any and all other federal, state, or local constitutional, statutory, regulatory, or common law causes of action now or hereafter recognized, and any claims for attorneys’ fees and costs.  Nothing in this Release shall waive any of the following: (i) rights or claims that arise after the date on which I execute this Release, (ii) claims for salary for work performed through the Termination Date under Section 2(a) of my Employment Agreement with United Online dated February 7, 2011 (“Employment Agreement”) and for reimbursement of expenses under Section 2(c) of the Employment Agreement, (iii) claims I may have for unemployment compensation and worker’s compensation, (iv) claims for health insurance benefits under the Consolidated Omnibus Budget Reconciliation Act (COBRA) and claims under ExecUCare arising for medical incidents prior to the Termination Date, (v) claims with respect to vested benefits under a pension or retirement plan governed by the Employee Retirement Income Security Act and claims for refunds to which I may be entitled under the Company’s Employee Stock Purchase Plan, (vi) any claims for indemnification to which I may be entitled by contract or under United Online’s or any its subsidiaries’ Certificate or Articles of Incorporation and Bylaws, (vii) claims and rights that I may assert in response to any claim asserted against me under Section 11 of the Employment Agreement or under applicable law relating to matters described in that Section 11, and (viii) any claims that, as a matter of applicable law, are not waivable or otherwise subject to release.

 

2.     I do not presently believe I have suffered any work-related injury or illness.

 

3.     I understand and agree that United Online will not provide me with the opportunity to have a continuing consulting relationship with United Online pursuant to that certain Post-Employment

 

1

 

Consulting Agreement (“Consulting Agreement”) I am to enter this day with United Online unless I execute and deliver this Release and such Release becomes enforceable and irrevocable under applicable law, and I understand I am not otherwise entitled to such consulting relationship in the absence of such Release, I further understand that I have received or will receive, regardless of the execution of this Release, all undisputed wages owed to me, together with any accrued but unused vacation pay, less deductions, in my final paycheck.  I acknowledge and understand that I am waiving and releasing all claims for disputed wages or other forms of compensation.

 

4.     I acknowledge that I may discover facts different from or in addition to those which I now know or believe to be true and that this Release shall be and remain effective in all respects even if I discover new or additional facts after I sign this Release.  I expressly waive all rights and benefits conferred upon me by the provisions of Section 1542 of the California Civil Code and/or any analogous law of any other state, which states as follows:

 

A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR [EMPLOYEE] DOES NOT 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 THE DEBTOR [COMPANY].

 

I understand and agree that I am releasing all claims against the Company, even those that I do not currently know or suspect to exist, except those claims described in subparts (i) through (viii) in the second paragraph of Section 1 above.

 

5.     I agree that I will not disparage the Company or its directors, officers, management, employees, business, services, products, culture or competition, and will not encourage any third parties to do so.  Without limiting the generality of the foregoing, I agree that I will not post disparaging comments in Internet websites or chat rooms or via instant messaging; provided, however, that I understand that nothing in this Release is intended to prevent, impede or otherwise interfere with my ability and/or right to: (a) provide truthful testimony if under subpoena to do so or (b) file a claim with any state or federal agency or to participate or cooperate in such a matter, provided, however, that I hereby acknowledge and agree that I cannot recover any monetary benefits in connection with any such claim.

 

6.     I represent and warrant that I am the sole owner of all claims relating to my employment with the Company, and that I have not assigned or transferred any claims relating to my employment to any other person or entity.

 

7.     I understand and agree that this Release shall not be construed at any time as an admission of liability or wrongdoing by either myself or the Company.

 

8.     This Release contains the entire agreement between the Company and me with respect to any matters referred to in the Release and supersedes any previous oral or written agreements.

 

9.     If any one or more of the provisions contained in this Release is, for any reason, held to be unenforceable, that holding will not affect any other provision of this Release, and this Release

 

2

 

shall then be construed as if the unenforceable provisions had never been contained in the Release.

 

10.   I acknowledge that I have obtained sufficient information to intelligently exercise my own judgment regarding the terms of this Release before executing this Release.  I understand that I may discuss this Release with an attorney of my choosing before signing this Release.

 

11.   I acknowledge that this Release was presented to me on March 9, 2012 (the “Release Delivery Date”) and that I am entitled to have twenty-one (21) days from the Release Delivery Date in which to review and consider it.  I understand and acknowledge that the Company advises me to obtain advice concerning this Release from an attorney of my choice before signing this Release. I further represent that I have had sufficient time to review and consider the terms of this Release.  I represent that if I execute this Release before the twenty-one (21)-day review/consideration period has elapsed, I do so voluntarily, and that I voluntarily waive any remaining review/consideration period.  However, I agree and acknowledge that in no event shall I sign and deliver this Release to the Company prior to the close of business on my Termination Date.

 

12.   I understand that after executing this Release, I have the right to revoke it in writing within seven (7) days after I sign it.  I understand that any revocation of this Release must be made in writing and delivered to the Company at 21301 Burbank Boulevard, Woodland Hills, California 91367, Attention: Charles B. Ammann,  within the seven (7) day revocation period.  I understand that my consulting relationship with United Online pursuant to the terms of the Consulting Agreement will not remain in force or effect unless (a) this Release has been fully executed by me and delivered to the Company prior to the expiration of the twenty-one (21) day review period measured from the Release Delivery Date, and (b) the seven (7) day revocation period has passed without my revoking the Release in writing.  I understand that this Release may not be revoked after the seven (7) day revocation period has passed.  Provided and only if the foregoing conditions set forth in this Section 12 have been satisfied in accordance with the applicable time periods, I understand that (i) my consulting relationship with United Online will continue in full force and effect pursuant to the terms of the Consulting Agreement

 

13. I acknowledge that this Release shall be governed by and construed according to the laws of the State of California, without regard to its conflicts of law principles.  I also consent to the venue and jurisdiction of the state and federal courts located in Los Angeles, California in the event that the Company takes legal action to enforce any of the terms of this Release.

 

3

 

EMPLOYEE’S ACCEPTANCE OF RELEASE

 

BEFORE SIGNING MY NAME TO THIS RELEASE, I STATE THE FOLLOWING:  I HAVE READ IT; I UNDERSTAND IT AND I KNOW THAT I AM GIVING UP IMPORTANT RIGHTS; I HAVE OBTAINED SUFFICIENT INFORMATION TO INTELLIGENTLY EXERCISE MY OWN JUDGMENT; I HAVE BEEN ADVISED THAT I SHOULD CONSULT WITH AN ATTORNEY BEFORE SIGNING IT; AND I HAVE SIGNED IT KNOWINGLY AND VOLUNTARILY.

 

	
 
    	
Date presented to employee: March 9, 2012.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Executed this 16th day of March, 2012.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
/s/ Frederic A. Randall, Jr.
    
	
 
    	
Frederic A. Randall, Jr.
    

 

4

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