Document:

Exhibit 10.5

 

FIRST AMENDMENT

TO

EMPLOYMENT AGREEMENT

 

This amendment
dated and effective January 1, 2009 (this “Amendment”), amends that
certain Employment Agreement dated as of August 15, 2007 (the “Original
Agreement”) by and between United Online, Inc. (the “Company”), and Matthew
J. Wisk.  Capitalized terms used and not
otherwise defined herein shall have the respective meanings set forth in the
Original Agreement.

 

RECITALS

 

WHEREAS, Section 409A of the Internal Revenue
Code of 1986, as amended (the “Code”), places certain restrictions, among other
things, as to the timing of distributions from nonqualified deferred compensation plans and arrangements;
and

 

WHEREAS,
the parties desire to amend the Original Agreement to comply with Section 409A
of the Code and to reflect certain changes related to Mr. Wisk’s new
position.

 

NOW,
THEREFORE, in consideration of the mutual promises set forth herein, the
parties hereto hereby agree as follows:

 

1.                                       The
first sentence of Section 1 of the Original Agreement is hereby removed
and replaced in its entirety as follows:

 

“You
will serve as President of MyPoints.com, Inc. (“MyPoints”) and report to the
President of Classmates Media Corporation or to such other individual as
otherwise determined by the Chief Executive Officer of the Company.”

 

2.                                       The
references to “Board of Directors” or “the Company’s Board of Directors” in Section 2(a) and
Section 3 of the Original Agreement shall mean the Board of Directors of
MyPoints.

 

3.                                       The
following new sentences are hereby added to the end of Section 2(c) of
the Original Agreement:

 

“In
addition, in connection with your relocation to the MyPoints office in San
Francisco, California, the Company agrees to reimburse you for the amount of
the real estate commission paid by you in connection with the sale of your
residence located in Westlake Village, California, upon your submission of
reasonable documentation thereof.  You
must submit such documentation within 45 days after your payment of such
commission, and the Company will reimburse you within 30 days thereafter. In no
event shall any expense be reimbursed later than the end of the calendar year following the calendar year in
which that expense was incurred, and the amounts reimbursed in any one calendar
year shall not affect the amounts reimbursable in any other calendar year.  Your right to receive such reimbursements may
not be exchanged or liquidated for any other benefit.”

 

4.                                       A
new sentence is hereby added to the end of Section 3 of the Original
Agreement, as follows:

 

“Your
annual bonus award shall in no event be paid later than the 15th day of the
third month following the end of your taxable year or, if later, the end of the
Company’s taxable year  in 

 

 

which such bonus award is earned.”

 

5.                                       A
new sentence is hereby added to the end of each of Section 4(b) and 4(c) of
the Original Agreement, as follows:

 

“Except
as otherwise expressly provided in the agreement evidencing a particular  restricted stock unit award, the shares of
common stock underlying the restricted stock units that vest on such an
accelerated basis will be issued to you on the first business day, within the
sixty (60)-day period following the date of your cessation from service as a
result of your termination “without cause” (as defined below) or your resignation
for “good reason” (as defined below), on which the executed Release required of
you pursuant to Section 7(b) is effective and enforceable in
accordance with its terms following any applicable revocation period, or as
soon thereafter as administratively practicable, but in no event later than the
last business day of that sixty (60)-day period on which such Release is
effective and enforceable.”

 

6.                                       The
first paragraph of Section 7(b) of the Original Agreement is hereby amended
in its entirety to read as follows:

 

“If (i) your employment is terminated by the
Company “without cause” (as defined below) prior to August 15, 2010, (ii) you
execute and deliver to the Company, within twenty-one (21) days  (or forty-five (45) days to the extent such
longer period is required under applicable law) after the effective date of
your termination of employment, a comprehensive agreement releasing the Company
and its officers, directors, employees, stockholders, subsidiaries, affiliates,
representatives and other parties and containing such other and additional
terms as the Company deems satisfactory (the “Release”)
and (iii) such Release becomes effective and enforceable after the
expiration of any applicable revocation period under federal or state law, then
the Company will pay you a separation payment (the “Separation
Payment”) equal to the sum of (i) twelve (12) months of
your then current monthly base salary, (ii) your Annual Bonus (as defined
below), and (iii) a prorated portion of your Annual Bonus (as defined
below) based upon the time elapsed between December 31 of the preceding
year and your date of termination.  In
addition, notwithstanding the fourth sentence of Section 3 above but
contingent upon your delivery of an effective and enforceable Release in accordance
with the foregoing provisions of this Section 7(b), if the date of such
termination occurs following the end of a fiscal year and prior to the date
that you would have otherwise been entitled to be paid your annual bonus for
that fiscal year, the Company will pay you an amount equal to the annual bonus
that you would have received had you remained employed by, and in good standing
with, the Company through the date the annual bonus for that fiscal year is
paid in the following fiscal year, with that amount to be paid at the same time
and manner that such payment would have paid to you had you remained employed
through such date, but in no event later than the last day of the fiscal year
immediately following fiscal year for which such bonus is earned.

 

Payment of this Separation Payment and the additional
bonus amount (if any) under this Section 7(b) and the accelerated
vesting of your equity awards under Section 4, will each be contingent upon
the satisfaction of the following requirements: (i) you execute and
deliver to the Company on a timely basis your required Release in accordance
with this Section 7(b), (ii) such Release becomes effective and enforceable after the
expiration of any applicable revocation period under federal or state law and
(iii) you continue to comply with the Proprietary Information and
Inventions Agreement and the restricted covenants set forth in Section 9
below.

 

 

The Separation Payment under
this Section 7(b) will be payable in a series of twelve (12)
successive equal monthly installments, beginning on the first regular payday
for the Company’s salaried employees, within the sixty (60)-day period
following the date of your “separation from service” (as such term is defined
in Treasury Regulations issued under Code Section 409A) as a result of
your termination “without cause” (as defined below), on which your executed Release
is effective and enforceable in accordance with its terms following any
applicable revocation period, or as soon thereafter as administratively practicable,
but in no event later than the last day of that sixty (60)-day period on which
such Release is effective and enforceable. 
Your right to each such monthly installment of the Separation Payment
shall be deemed, for purposes of Section 409A of the Code, to be a right
to a series of separate payments.”

 

7.                                       The
last paragraph of Section 7(b) of the Original Agreement is hereby deleted
and replaced in its entirety as follows:

 

“If
any payment or benefit received or to be received by you (including any payment
or benefit received pursuant to this letter agreement or otherwise) would be
(in whole or part) subject to the excise tax imposed by Section 4999 of
the Internal Revenue Code of 1986, as amended (the ‘Code’), or any successor
provision thereto, or any similar tax imposed by state or local law, or any
interest or penalties with respect to such excise tax (such tax or taxes,
together with any such interest and penalties, are hereafter collectively
referred to as the ‘Excise Tax’), then, the cash payments provided to you under
this letter agreement shall first be reduced, with each such payment to be
reduced pro-rata but without any change in the payment date and with the
monthly installments of the Separation Payment to be the first such cash
payments so reduced, and then, if necessary, the accelerated vesting of your
equity awards pursuant to the provisions of this letter agreement shall be
reduced in the same chronological order in which those awards were made, but
only to the extent necessary to assure that you receive only the greater of (i)  the amount
of those payments and benefits which would not constitute a parachute payment
under Code Section 280G or (ii)  the amount which yields you the
greatest after-tax amount of benefits after taking into account any Excise Tax
imposed on the payments and benefits provided you hereunder (or on any other
payments or benefits to which your may become entitled in connection with any
change in control or ownership of the Company or the subsequent termination of your
employment with the Company).”

 

8.                                       The first sentence of Section 7(c) is
hereby deleted and replaced with the following:

 

“If
your employment is terminated as a result of your death or Disability, the
Company will be obligated to pay the Accrued Obligations to you, your estate or
beneficiaries (as the case may be) on your termination date or as soon as
administratively practicable thereafter, but in no event later than sixty (60)
days after the date of such termination.”

 

9.                                       The
definition of “good reason” as set forth in Section 7(d) of the
Original Agreement is hereby deleted and
replaced in its entirety as follows:

 

“‘good reason’ means:

 

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

(ii)                      a material reduction in your authority,
duties or responsibilities, without your prior written consent, unless such
reduction is effected at the request of Mark R. Goldston;

 

 

(iii)                   a material change in the geographic location at which you must perform
services (the parties acknowledge that you are currently required to perform
services at 525 Market Street, Suite 3400,
San Francisco, CA 94105) without your prior consent; or

 

(iv)                  any
material un-waived breach by the Company of the terms of this letter agreement;
provided however, that with respect to any of the clause (i) – (iv) events
above, you will not be deemed to have resigned for good reason unless (A) you
provide written notice to the Company of the existence of the good reason event
within ninety (90) days after its initial occurrence, (B) the Company is
provided with thirty (30) days in which to cure such good reason event, and (C) your
termination of employment is effected within one hundred eighty (180) days
following the occurrence of the non-cured clause (i) – (iv) event.”

 

10.                                 Section 7(e) of
the Original Agreement is hereby deleted and replaced in its entirety as
follows:

 

“(e)                            Notwithstanding
any provision in this letter agreement to the contrary (other than Section 7(f) below),
no payment or distribution under this letter agreement which constitutes an
item of deferred compensation under Section 409A of the Code and becomes
payable by reason of your termination of employment with the Company will be
made to you until you incur a “separation from service” (as such term is
defined in Treasury Regulations issued under Section 409A of the Code) in
connection with such  termination of
employment.  For purposes of this letter
agreement, each amount to be paid or benefit to be provided you shall be
treated as a separate identified payment or benefit for purposes of Section 409A
of the Code.  In addition, no payment
or  benefit which constitutes an item of
deferred compensation under Section 409A of the Code and becomes payable
by reason of your  separation from
service will be made to you prior to the earlier of (i) the
first day of the seventh (7th) month measured from the date of such separation
from service or (ii) the date of your 
death, if you are deemed at the time of such separation from service to
be a specified employee (as determined pursuant to Code Section 409A and
the Treasury Regulations thereunder) and such delayed commencement is otherwise
required in order to avoid a prohibited distribution under Code Section 409A(a)(2).  Upon the expiration of the applicable deferral
period, all payments and benefits deferred pursuant to this Section 7(e) (whether
they would have otherwise been payable in a single sum or in installments in
the absence of such deferral) shall be paid or provided to you in a lump sum on
the first day of the seventh (7th) month after the date of your separation from
service or, if earlier, the first day of the month immediately following the
date the Company receives proof of your death. Any remaining payments or
benefits due under this letter agreement will be paid in accordance with the
normal payment dates specified herein.”

 

11.                                 A
new Section 7(f) is hereby added as follows:

 

“(f)                            Notwithstanding
Section 7(e) above, the following provisions shall also be applicable
to you if you are a specified employee at the time of your separation of
service:

 

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

 

 

(ii)                            The
remaining portion of the payments and benefits to which you become entitled
under this letter agreement, to the extent they do not in the aggregate exceed
the dollar limit described below and are otherwise scheduled to be paid no
later than the last day of the second calendar year following the calendar year
in which your  separation from service
occurs, shall  not be subject to any
deferred commencement date under Section 7(e) and shall be paid to
you as they become due and payable under this letter agreement.  For purposes of this subparagraph (ii), the
applicable dollar limitation will be equal to two times the lesser of (i) your annualized
compensation (based on your annual rate of pay for the calendar year preceding
the calendar year of your separation from service, adjusted to reflect any
increase during that calendar year which was expected to continue indefinitely
had such separation from service not occurred) or (ii) the compensation
limit under Section 401(a)(17) of the Code as in effect in the year of
such  separation from service.  To the extent the portion of the severance
payments and benefits to which you would otherwise be entitled under this
letter agreement during the deferral period under Section 7(e) exceeds
the foregoing dollar limitation, such excess shall be paid in a lump sum upon
the expiration of that deferral period, in accordance with the deferred payment
provisions of Section 7(e), and the remaining severance payments and
benefits (if any) shall be paid in accordance with the normal payment dates specified
for them herein.”

 

12.                                 Except as modified by this Amendment, all the
terms and provisions of the Original Agreement shall continue in full force and
effect.

 

(Signature Page Follows)

 

 

IN
WITNESS WHEREOF, each of the parties hereto has executed this Amendment on the
date specified therefor below.

 

	
   

  	
   

  
	
   

  	
  UNITED ONLINE, INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Mark R. Goldston

  
	
   

  	
   

  	
  Mark R. Goldston

  
	
   

  	
   

  	
  Chairman, President and Chief Executive

  
	
   

  	
   

  	
  Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Dated:

  	
  December 19, 2008

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Matthew J. Wisk

  
	
   

  	
   

  	
  Matthew J. Wisk

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Dated:

  	
  December 19, 2008Exhibit 10.6

 

UNITED
ONLINE, INC. 

RESTRICTED STOCK UNIT ISSUANCE AGREEMENT(S)

 

AMENDMENT AGREEMENT

 

AMENDMENT AGREEMENT by
and between United Online, Inc., a Delaware corporation (the “Corporation”),
and Mark Goldston (the “Participant”) to be effective as of January 1,
2009.

 

RECITALS

 

A.            Participant is a
party to one or more Restricted Stock Unit Issuance Agreements with the
Corporation pursuant to which Participant will become entitled to receive
shares of Common Stock that vest under the restricted stock units evidenced by
those agreements.

 

B.            The purpose of this
Amendment Agreement is to bring each of those Restricted Stock Unit Issuance
Agreements, to the extent they pertain to restricted stock units that were not
vested as of December 31, 2004, into documentary compliance with the
applicable provisions of Section 409A of the Internal Revenue Code of
1986, as amended, and the Treasury Regulations thereunder.

 

C.            The Restricted Stock
Unit Issuance Agreements that are subject to this Amendment Agreement are more
particularly identified in attached Schedule I.

 

D.            All capitalized
terms in this Amendment Agreement shall have the same meanings assigned to them
in the applicable Restricted Stock Unit Issuance Agreement.

 

NOW, THEREFORE, it is agreed each of the
Restricted Stock Unit Issuance Agreements is hereby amended as follows,
effective January 1, 2009:

 

1.             The Issuance Schedule set forth in Paragraph 1 of each
Restricted Stock Unit Issuance Agreement is hereby amended in its entirety to
read as follows:

 

“The Shares in which the Participant vests in
accordance with the regular Vesting Schedule set forth above shall be issued,
subject to the Corporation’s collection of all applicable Withholding Taxes, on
the applicable vesting date specified for those Shares in such Vesting Schedule
or as soon thereafter as administratively practicable, but in no event later
than the close of the calendar year in which the vesting date occurs or (if
later) the fifteenth day of the third calendar month following such vesting
date. The applicable Withholding Taxes are to be collected pursuant to the
procedures set forth in Paragraph 8 of this Agreement.”

 

 

2.             Paragraph 4 of each
Restricted Stock Unit Issuance Agreement is hereby amended in its entirety to
read as follows:

 

 “4.          Accelerated Vesting.  The Participant’s Employment Agreement
sets forth certain terms and conditions under which Participant’s equity or
equity-based awards from the Corporation, including this Award, may vest on an
accelerated basis under various specified circumstances. The terms and
provisions of the Employment Agreement (including any conditions, restrictions
or limitations governing the accelerated vesting or issuance of the Shares), as
they apply to this Award, are hereby incorporated by reference into this
Agreement and shall have the same force and effect as if expressly set forth in
this Agreement.  The Shares that vest on
such an accelerated basis shall be issued on the applicable vesting date or as
soon thereafter as administratively practicable, but in no event later than the
close of the calendar year in which the vesting date occurs or (if later) the
fifteenth day of the third calendar month following such vesting date, subject
to the Corporation’s collection of the applicable Withholding Taxes.”

 

3.             Paragraph 6(c) of
each Restricted Stock Unit Issuance Agreement is hereby amended in its entirety
to read as follows:

 

“(c)         Any Restricted Stock
Units which are assumed or otherwise continued in effect in connection with a
Change in Control or replaced with a cash incentive program under Paragraph 6(a) shall
be subject to the vesting acceleration provisions of the Participant’s
Employment Agreement.  Accordingly, the
terms and provisions of the Employment Agreement (including any conditions, restrictions
or limitations governing the accelerated vesting or  issuance of the securities subject to the Participant’s
outstanding equity awards or the distribution of the proceeds of any replacement
cash incentive plan) shall apply to any Restricted Stock Units under this
Agreement which are assumed or otherwise continued in effect in connection with
a Change in Control or replaced with a cash incentive program under Paragraph 6(a) and
are hereby incorporated by reference into this Agreement, with the same force
and effect as if expressly set forth in this Agreement.  The Shares underlying any Restricted Stock
Units, or the proceeds of any replacement cash incentive plan, which vest on an
accelerated basis in accordance with those provisions shall be issued or
distributed on the applicable vesting date or as soon thereafter as
administratively practicable, but in no event later than the close of the
calendar year in which the vesting date occurs or (if later) the fifteenth day
of the third calendar month following such vesting date, subject to the
Corporation’s collection of the applicable Withholding Taxes.”

 

4.             Paragraph 6(d) of
each Restricted Stock Unit Issuance Agreement is hereby amended in its entirety
to read as follows:

 

2

 

“(d)         If
the Restricted Stock Units subject to this Award at the time of the Change in
Control are not assumed or otherwise continued in effect or replaced with a
cash incentive program in accordance with Paragraph 6(a), then those units
shall vest immediately prior to the closing of the Change in Control. The
Shares subject to those vested units shall be converted into the right to
receive the same consideration per share of Common Stock payable to the other
stockholders of the Corporation in consummation of that Change in Control, and
such consideration shall be distributed to Participant on the effective date of
that Change in Control or as soon thereafter as administratively practicable,
but in no event later than three (3) business days following the effective
date of that Change in Control. Such distribution shall be subject to the
Corporation’s collection of the applicable Withholding Taxes pursuant to the
provisions of Paragraph 8.”

 

5.             There is hereby
added to each Restricted Stock Unit Issuance Agreement the following new
Paragraph 14:

 

“14.        Deferred Issuance Date.

 

(a)           It
is the intention of the parties that the provisions of this Agreement, as
amended by the Amendment Agreement, continue 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 Agreement as so amended 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)           If
and to the extent this Agreement may be deemed to create an arrangement subject
to the requirements of Section 409A, then no Shares or other amounts which
become issuable or distributable by reason of Participant’s cessation of Service
shall actually be issued or distributed to Participant prior to the earlier of (i) the first day of
the seventh (7th) month following the date of his or her Separation from
Service due to such cessation of Service or (ii) the date of Participant’s
death, if Participant is deemed at the time of such Separation from Service to
be a specified employee under Section 1.409A-1(i) of the Treasury
Regulations issued under Code Section 409A, as determined by the Plan
Administrator in accordance with consistent and uniform standards applied to
all other Code Section 409A arrangements of the Corporation, and such
delayed commencement is otherwise required in order to avoid a prohibited
distribution under Code Section 409A(a)(2).  The deferred Shares or other distributable
amount shall be issued or distributed in a lump sum on the first day of the
seventh (7th) month following the date of Participant’s Separation from Service
or, if earlier, the first day of the month immediately following the date the
Corporation receives proof of Participant’s death.

 

3

 

(c)           For
purposes of this Agreement, the term Separation from Service shall have the
meaning ascribed to such term under Code Section 409A and the Treasury Regulations
issued thereunder.”

 

6.             The definition of
Employment Agreement set forth in Appendix A of each Restricted Stock Unit
Issuance Agreement is hereby amended in its entirety to read as follows:

 

“Employment Agreement
shall mean the Amended and Restated Employment Agreement between the Participant
and the Corporation effective January 1, 2009.”

 

7.             The definition of
Involuntarily Terminated set forth in Appendix A of each Restricted Stock Unit
Issuance Agreement is hereby deleted in its entirety.

 

8.             Except as modified
by this Amendment Agreement, all the terms and conditions of each Restricted
Stock Unit Issuance Agreement subject to this Amendment Agreement shall
continue in full force and effect.

 

[Signature Page Follows]

 

4

 

IN WITNESS WHEREOF, each
of the parties has executed this Amendment Agreement on the date specified for
that party below.

 

	
   

  	
  UNITED ONLINE, INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Frederic A.
  Randall, Jr.

  
	
   

  	
   

  
	
   

  	
  Title:

  	
  EVP and General Counsel

  
	
   

  	
   

  
	
   

  	
  Dated:

  	
  December 29, 2008

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Mark Goldston

  
	
   

  	
  MARK GOLDSTON, PARTICIPANT

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Dated:

  	
  December 19, 2008

  
						

 

5

 

SCHEDULE I

 

RESTRICTED STOCK UNIT ISSUANCE AGREEMENTS
SUBJECT TO AMENDMENT AGREEMENT

 

 

The Restricted Stock Unit Issuance Agreements between the Corporation
and Participant governing the following Awards are subject to the Amendment
Agreement:

 

	
  Award Date:

  	
   

  	
  Number of Restricted

  Stock Units

  Originally Subject to

  Agreement:

  	
   

  	
  Number of Restricted

  Stock Units

  Currently Outstanding:

  	
   

  	
  Number of Restricted

  Stock Units

  Subject to Amendment

  Agreement:

  	
   

  
	
  March 24, 2005

  	
   

  	
  500,000

  	
   

  	
  125,000

  	
   

  	
  125,000

  	
   

  
	
  February 15, 2007

  	
   

  	
  250,000

  	
   

  	
  166,667

  	
   

  	
  166,667

  	
   

  
	
  April 3, 2007

  	
   

  	
  750,000

  	
   

  	
  750,000

  	
   

  	
  750,000

  	
   

  
	
  August 26, 2008

  	
   

  	
  650,000

  	
   

  	
  650,000

  	
   

  	
  650,000

  	
   

  

 

6

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