10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2010

OR

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                      to                     

Commission File Number 001-34419

AOL INC.

(Exact name of registrant as specified in its charter)

Delaware	20-4268793
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
770 Broadway New York, NY	10003
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: 212-652-6400

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  x    No  ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulations S-T (§232.405 of this chapter) during the preceding 12 months (or for shorter period that the registrant was required to submit and post such files).    Yes  ¨    No  ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer  ¨	Accelerated filer  ¨
Non-accelerated filer  x	Smaller reporting company  ¨
(Do not check if a smaller reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act.)    Yes  ¨    No  x

As of July 30, 2010, the number of shares of the Registrant’s common stock, par value $0.01 per share, outstanding was 106,742,658.

AOL INC.

TABLE OF CONTENTS

		Page Number
PART I. FINANCIAL INFORMATION
	Cautionary Statement Concerning Forward-Looking Statements	1
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	2
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	23
Item 4T.	Controls and Procedures	24
Item 1.	Financial Statements	25
PART II. OTHER INFORMATION
Item 1.	Legal Proceedings	40
Item 1A.	Risk Factors	41
Item 6.	Exhibits	41
Signatures		42
Exhibit Index		43

AOL INC.

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

	Page Number
Consolidated Statements of Operations for the Three and Six Months Ended June 30, 2010 and 2009	25
Consolidated Balance Sheets as of June 30, 2010 and December 31, 2009	26
Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2010 and 2009	27
Consolidated Statements of Equity for the Six Months Ended June 30, 2010 and 2009	28
Note 1: Description of Business, Basis of Presentation and Summary of Significant Accounting Policies	29
Note 2: Income Per Common Share	31
Note 3: Goodwill	32
Note 4: Business Acquisitions, Dispositions and Other Significant Transactions	33
Note 5: Income Taxes	35
Note 6: Stockholders’ Equity	35
Note 7: Equity-Based Compensation	36
Note 8: Restructuring Costs	37
Note 9: Commitments and Contingencies	38
Note 10: Segment Information	39

AOL INC.

CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q (“Quarterly Report”) contains certain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 regarding business strategies, market potential, future financial performance and other matters. Words such as “anticipates,” “estimates,” “expects,” “projects,” “forecasts,” “intends,” “plans,” “will,” “believes” and words and terms of similar substance used in connection with any discussion of future operating or financial performance identify forward-looking statements. These forward-looking statements are based on management’s current expectations and beliefs about future events. As with any projection or forecast, they are inherently susceptible to uncertainty and changes in circumstances. Except as required by law, we are under no obligation to, and expressly disclaim any obligation to, update or alter any forward-looking statements whether as a result of such changes, new information, subsequent events or otherwise.

Various factors could adversely affect our operations, business or financial results in the future and cause our actual results to differ materially from those contained in the forward-looking statements, including those factors discussed in detail in “Item 1A—Risk Factors” of our Annual Report on Form 10-K for the year ended December 31, 2009 (“Annual Report”). In addition, we operate a web services company in a highly competitive, rapidly changing and consumer and technology-driven industry. This industry is affected by government regulation, economic, strategic, political and social conditions, consumer response to new and existing products and services, technological developments and, particularly in view of new technologies, the continued ability to protect intellectual property rights. Our actual results could differ materially from management’s expectations because of changes in such factors.

Further, lower than expected market valuations associated with our cash flows and revenues may result in our inability to realize the value of recorded intangibles and goodwill. In addition, achieving our business and financial objectives, including growth in operations and maintenance of a strong balance sheet and liquidity position, could be adversely affected by the factors discussed or referenced in “Item 1A—Risk Factors” in our Annual Report as well as, among other things:

• changes in our plans, strategies and intentions;

• our ability to attract and retain key employees;

• asset impairments;

• the success of any cost reductions, restructuring actions or similar efforts, including with respect to any associated savings, charges or other amounts;

• the impact of significant acquisitions, dispositions and other similar transactions;

• the failure to meet earnings expectations;

• decreased liquidity in the capital markets;

• our ability to access the capital markets for debt securities or bank financings;

• our borrowing capacity under our revolving credit facility; and

• the impact of terrorist acts and hostilities.

References in this Quarterly Report to “we,” “us,” “Company,” and “AOL” refer to AOL Inc., a Delaware corporation.

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AOL INC.

PART I - ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

You should read the following discussion of our results of operations and financial condition together with our consolidated financial statements and the notes thereto included elsewhere in this Quarterly Report as well as the discussion in the “Item 1—Business” section of our Annual Report. This discussion contains forward-looking statements that involve risks and uncertainties. The forward-looking statements are not historical facts, but rather are based on current expectations, estimates, assumptions and projections about our industry, business and future financial results. Our actual results could differ materially from the results contemplated by these forward-looking statements due to a number of factors, including those discussed in “Item 1A—Risk Factors” of our Annual Report and “Cautionary Statement Concerning Forward-Looking Statements” herein.

Introduction

Management’s discussion and analysis of financial condition and results of operations (“MD&A”) is a supplement to the accompanying consolidated financial statements and provides additional information on our business, recent developments, results of operations, liquidity and capital resources and critical accounting policies. MD&A is organized as follows:

• Overview. This section provides a general description of our business, as well as recent developments we believe are important in understanding our results of operations and financial condition or in understanding anticipated future trends.

• Results of operations. This section provides an analysis of our results of operations for the three and six months ended June 30, 2010 and 2009.

• Liquidity and capital resources. This section provides a discussion of our current financial condition and an analysis of our cash flows for the six months ended June 30, 2010 and 2009. This section also provides a discussion of our principal debt obligations and an update to the discussion in our Annual Report of our customer credit risk that existed at December 31, 2009.

• Critical accounting policies. This section identifies and summarizes those accounting policies that are considered important to our results of operations and financial condition and require significant judgment and estimates on the part of management.

Overview

The Spin-Off

On December 9, 2009, we completed our legal and structural separation from Time Warner Inc. (“Time Warner”) via a spin-off (the “spin-off”). In the spin-off, Time Warner shareholders of record as of 5 p.m. on November 27, 2009, the record date for the distribution, received one share of AOL common stock for every eleven shares of Time Warner common stock held. On December 10, 2009, AOL began trading on the New York Stock Exchange as an independent, public company.

Prior to the spin-off, we were a subsidiary of Time Warner. The financial information prior to the spin-off may not necessarily reflect our financial position, results of operations and cash flows in the future or what our financial position, results of operations and cash flows would have been had we been an independent, publicly-traded company during all of the periods presented. We are incurring additional costs to be able to function as an independent, publicly-traded company, including incremental costs related to corporate finance, governance and public reporting.

In connection with the spin-off, we entered into transactions with Time Warner that either have not existed historically or that are on terms different from the terms of arrangements or agreements that existed prior to the

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PART I - ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

spin-off. Our historical financial information does not reflect changes that we have experienced since the spin-off or expect to experience in the future as a result of our separation from Time Warner, including changes in the financing, operations, cost structure and personnel needs of our business. Further, the financial statements for the three and six months ended June 30, 2009 include allocations of certain Time Warner corporate expenses. We believe the assumptions and methodologies underlying the allocation of general corporate expenses are reasonable. However, such expenses may not be indicative of the actual level of expense that would have been incurred by us if we had operated as an independent, publicly-traded company or of the costs we have incurred since the spin-off or that are expected to be incurred in the future. These allocated expenses relate to various services that historically were provided to us by Time Warner, including cash management and other treasury services, administrative services (such as government relations, tax, employee benefit administration, internal audit, accounting and human resources), equity-based compensation plan administration, aviation services, insurance coverage and the licensing of certain third-party patents.

Our Business

We are a leading global web services company with an extensive suite of brands and offerings and a substantial worldwide audience. Our business spans online content, products and services that we offer to consumers, publishers and advertisers. We are focused on attracting and engaging consumers and providing valuable online advertising services. We market our offerings to advertisers on both AOL Properties and the Third Party Network under the brand “AOL Advertising.” We have the second largest advertising network in terms of online consumer reach in the United States for June 2010.

Current Economic Environment

The global economic recession adversely impacted our advertising revenues for the year ended December 31, 2009. We do not believe that the global economic environment had a material impact on our advertising revenues for the three and six months ended June 30, 2010. Further, we do not believe the global economic recession had a material impact on our subscription revenues.

AOL Properties

We seek to be a leading online provider of engaging consumer products and services, as well as a publisher of relevant and engaging online content by utilizing open and highly scalable publishing platforms and content management systems. In addition, we are extending the reach of our offerings to a consumer audience on multiple platforms and digital devices.

AOL Properties include our owned and operated content, products and services in the Content, Local, Paid Services and Consumer Applications strategy areas, in addition to our AOL Ventures offerings. We generate advertising revenues from AOL Properties through the sale of display advertising and search and contextual advertising. We offer advertisers a wide range of capabilities and solutions to effectively deliver advertising and reach targeted audiences across AOL Properties through our dedicated advertising sales force. We seek to provide effective and efficient advertising solutions utilizing data-driven insights that help advertisers decide how best to engage consumers. We offer advertisers marketing and promotional opportunities to purchase specific placements of advertising directly on AOL Properties (i.e., in particular locations and on specific dates). In addition, we offer advertisers the opportunity to bid on unsold advertising inventory on AOL Properties utilizing our proprietary scheduling, optimization and delivery technology. Finally, advertising inventory on AOL Properties not sold directly to advertisers, as described above, may be included for sale to advertisers with inventory purchased from third-party publishers in the Third Party Network.

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Growth of our advertising revenues depends on our ability to attract consumers and increase engagement on AOL Properties by offering compelling content, products and services, as well as on our ability to monetize such engagement by offering effective advertising solutions. In order to attract consumers and generate increased engagement, we have developed and acquired, and in the future will continue to develop and acquire, content, products and services designed to meet these goals.

Google Inc. (“Google”) is, except in certain limited circumstances, the exclusive web search provider for AOL Properties. In connection with these search services, Google provides us with a share of the revenue generated through paid text-based search and contextual advertising on AOL Properties. For the three and six months ended June 30, 2010, advertising revenues associated with the Google relationship (substantially all of which were search and contextual revenues generated on AOL Properties) were $98.5 million and $209.0 million, respectively. Domestically, we have agreed, except in certain limited circumstances, to use Google’s search services on an exclusive basis through December 19, 2010. Upon expiration of this agreement, we expect to continue to generate advertising revenues by providing paid-search advertising on AOL Properties, either through the continuation of our relationship with Google or an agreement with another search provider.

We view our subscription access service, which we offer to consumers in the United States for a monthly fee, as a valuable distribution channel for AOL Properties. In general, subscribers to our subscription access service are among the most engaged consumers on AOL Properties. However, our access service subscriber base has declined and is expected to continue to decline. This decline is the result of several factors, including the increased availability of high-speed broadband Internet connections, the optimization of a significant amount of online content, products and services for use with broadband Internet connections, the effects of our strategic focus on advertising, which has led to significantly reduced marketing efforts for our subscription access service, and the free availability of the vast majority of our content, products and services. See “Item 1A—Risk Factors—Risks Relating to Our Business—Our strategic shift to an online advertising-supported business model involves significant risks” in our Annual Report. As our subscriber base declines, we need to maintain the engagement of former subscribers and increase the number and engagement of other consumers on AOL Properties. We seek to do this by developing and offering engaging content, products and services. Further, we have transitioned and will continue to seek to transition a substantial percentage of those access subscribers who are terminating their paid access subscriptions to free AOL Properties offerings. One of the metrics we monitor related to our subscription access service is monthly average churn, which represents on average the number of AOL-brand access subscribers that terminate or cancel our services each month, factoring in new and reactivated subscribers. The domestic AOL-brand access subscriber monthly average churn declined to 2.6% for the three months ended June 30, 2010, as compared to 3.5% for the three months ended June 30, 2009. The average paid tenure of the remaining domestic AOL-brand access subscribers has been increasing, and was approximately 9.2 years and 8.2 years for the three months ended June 30, 2010 and 2009, respectively.

Historically, our primary subscription service has been our subscription access service. Moving forward, we seek to market new products and services that are either co-branded, third-party or AOL-developed products. To facilitate this goal, in 2010 we launched the initial phase of a single consumer-facing platform that allows us to manage and distribute these additional products as well as our subscription access service. We offer those products to our access subscribers as well as other Internet consumers. Revenue related to these product offerings was not material for the three and six months ended June 30, 2010.

For the three and six months ended June 30, 2010, our subscription revenues were $260.2 million and $542.9 million, respectively, as compared to $355.7 million and $749.2 million for the three and six months ended June 30, 2009, respectively. Our subscription revenues have relatively low direct costs, and accordingly, our subscription access service represents the source of the vast majority of our operating income. Although our

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subscription revenues have declined and are expected to continue to decline, we believe that our subscription access service will continue to provide us with an important source of revenue and cash flow for the foreseeable future. The revenue and cash flow generated from our subscription access service will help us to pursue our strategic initiatives and continue the transition of our business toward attracting and engaging Internet consumers and generating advertising revenues. We expect our total revenues and operating income to decline in the near term and foreseeable future, even if our strategy is successful and we are able to grow our advertising revenues, primarily due to the continuing decline in our subscriber base.

Third Party Network

We also generate advertising revenues through the sale of advertising on third party websites and on digital devices, which we collectively refer to as the “Third Party Network.” Our advertising offerings on the Third Party Network consist primarily of the sale of display advertising. In order to generate advertising revenues on the Third Party Network, we have historically had to incur higher traffic acquisition costs (TAC) as compared to advertising on AOL Properties. We currently market our offerings to publishers under the brand “Advertising.com”.

A significant portion of our revenues on the Third Party Network is generated from the advertising inventory acquired from a limited number of publishers. We plan to expand the Third Party Network in order to allow us to serve many more publishers and advertisers than at present.

In the fourth quarter of 2009, we began proactively de-emphasizing the search engine campaign management and lead generation affiliate products on the Third Party Network in order to focus and strengthen our efforts in display advertising solutions. Given the relatively high level of direct costs associated with these products, we do not believe that this change will have a significant adverse impact on operating income in 2010.

Trends, Challenges and Uncertainties Impacting Our Business

The web services industry is highly competitive and rapidly changing. Trends, challenges and uncertainties that may have a significant impact on our business, our opportunities and our ability to execute our strategy include the following:

• Commerce, information and advertising continue to migrate to the Internet and away from traditional media outlets at both the national and local levels. Additionally, traditional media outlets are facing significant economic challenges. We believe these continuing trends will create strategic growth opportunities for us to attract new consumers and develop new and effective advertising solutions. As part of our restructuring initiative that began late in 2009, we announced a plan to reduce operating costs and reinvest up to $100 million of those savings in existing strategic areas. As part of this plan and to expand our local strategic initiatives, we previously announced our plans to invest up to $50 million in Patch, our community-specific news and information platform, during 2010. We expect to shift a portion of the remainder of our $100 million reinvestment from other areas to Patch, such that we currently anticipate that we will increase our investment in Patch during the remainder of 2010 in order to accelerate the launch of Patch sites.

• As a part of the restructuring efforts that we began in 2009, we restructured our advertising organization. This resulted in the reassignment of a majority of our advertising accounts. We believe that these restructuring improvements to our advertising organization will continue to have a negative impact on our advertising revenues throughout 2010.

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• We have made changes to our content, products and services to enhance the consumer experience (e.g., fewer advertisements on certain AOL Properties). These changes have involved and may continue to involve eliminating or modifying advertising practices that historically have been a source of revenues. We intend to ultimately increase our revenues by increasing the attractiveness of our content, product and service offerings to consumers and therefore their value to advertisers through these enhancements to the consumer experience. Specifically, we have undertaken efforts on certain AOL Properties to reduce the number of display advertising units, reduce monetization of search results and reduce the number of contextual advertising links. Additionally, we are shifting our focus from the number of sites that we offer to fewer, bigger sites that better address the needs of users and advertisers. While difficult to quantify, we believe that these changes will have a negative impact on our advertising revenues in the near term, but we do not believe this impact has been or will be significant.

• As the amount of content that is available online continues to expand, consumers are increasingly fragmenting across the Internet. To address this fragmentation, we own a variety of niche sites (e.g. Engadget, Lemondrop and PoliticsDaily) that we expect to continue to drive consumer engagement. Additionally, we are organizing our content around a variety of “super networks”, with each super network aligning under the broad categories of either News, Entertainment, Life or Marketplace. Furthermore, the Third Party Network, which reaches thousands of websites, will allow us to continue to provide advertising solutions across a fragmenting Internet environment.

• There has been a significant shift in the method of Internet access away from dial-up access. This is due to a number of factors, including the increased availability of high-speed broadband Internet connections and the fact that a significant amount of online content, products and services has been optimized for use with broadband Internet connections. This trend has contributed and we expect it will continue to contribute to the decline in the number of our access subscribers. As a result of these factors, we expect subscription revenues to continue to decline in the future.

Audience Metrics

We utilize unique visitor numbers to evaluate the performance of AOL Properties as well as AOL Media, a subset of AOL Properties that excludes Mail, Instant Messaging, Search, Ventures and Local and Mapping. In addition, we utilize unique visitor numbers to evaluate the reach of our total advertising network, which includes both AOL Properties and the Third Party Network. Unique visitor numbers provide an indication of our consumer reach. Although our consumer reach does not correlate directly to advertising revenue, we believe that our ability to broadly reach diverse demographic and geographic audiences is attractive to brand advertisers seeking to promote their brands to a variety of consumers without having to partner with multiple content providers. AOL’s unique visitor numbers also include unique visitors attributable to co-branded websites owned by third parties for which certain criteria have been met, including that the Internet traffic has been assigned to us.

The source for our unique visitor information is a third party (comScore Media Metrix, or Media Metrix). Media Metrix has historically estimated unique visitors based on a sample of Internet users in various countries (referred to as the “panel-only methodology”). While we are familiar with the general methodologies and processes that Media Metrix uses in estimating unique visitors, we have not performed independent testing or validation of Media Metrix’s data collection systems or proprietary statistical models, and therefore we can provide no assurance as to the accuracy of the information that Media Metrix provides.

In 2009, Media Metrix announced the availability of an alternate methodology (currently referred to as “panel-centric unified” or “Media Metrix 360”) to estimate unique visitors, in order to provide a more accurate count of a website’s audience, and has continued to refine this methodology. We adopted this alternate

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methodology for our average monthly unique visitors to AOL Properties and AOL Media starting in December 2009 and going forward. As a result, our average monthly unique visitors to AOL Properties and AOL Media based on Media Metrix 360 will not be comparable to the data under the previous panel-only methodology. For comparison purposes, domestic average monthly unique visitors to AOL Properties and AOL Media are reported under both the Media Metrix 360 and panel-only methodology for the three and six months ended June 30, 2010.

The following table presents our unique visitor metrics for the periods presented (in millions):

	Three Months Ended June 30,		Six Months Ended June 30,
	2010	2009	2010	2009
Domestic average monthly unique visitors to AOL Properties (Media Metrix 360)	112	NA	112	NA
Domestic average monthly unique visitors to AOL Properties (Panel- only methodology)	103	107	102	107
Domestic average monthly unique visitors to AOL Media (Media Metrix 360)	82	NA	84	NA
Domestic average monthly unique visitors to AOL Media (Panel-only methodology)	74	76	74	73
Domestic average monthly unique visitors to AOL Advertising Network	184	176	185	175

Recent Developments

Acquisition of StudioNow

On January 22, 2010, we completed the acquisition of StudioNow, Inc. (“StudioNow”), a provider of a proprietary digital platform that allows clients to create, produce, manage and distribute professional quality videos at scale, for a purchase price of $32.1 million (excluding $3.1 million due two years after the closing date and contingent on the future service of certain StudioNow employees). $14.1 million of the consideration was paid through the issuance of 594,749 shares of AOL common stock valued as of the closing date. Of the remaining $18.0 million, $14.0 million was paid in cash at the closing date and $4.0 million reflects the present value of the cash consideration due two years after the closing date. The results of operations of StudioNow from the acquisition date through June 30, 2010 were not material to our consolidated financial statements. See “Note 4” in our accompanying consolidated financial statements for additional information on our acquisition of StudioNow.

Sale of Perfiliate Limited (doing business as buy.at)

On February 26, 2010, we sold buy.at to Digital Window Limited for $16.4 million in net cash. We recorded a pre-tax loss on this sale of $18.7 million, calculated as the excess of the carrying value of the net assets sold (including goodwill allocated to the sale of $12.6 million) over the cash proceeds, net of transaction costs. Due primarily to our conclusions around the likelihood of utilizing a portion of the capital loss deferred tax asset generated by the sale of buy.at, we recorded an income tax benefit on the sale of buy.at of $15.0 million and $26.7 million for the three and six months ended June 30, 2010, respectively. The financial condition, results of operations and cash flows of buy.at have been reflected as discontinued operations for all periods presented. The results of operations of buy.at were not material to our consolidated financial statements. See “Note 4” in our accompanying consolidated financial statements for additional information on our sale of buy.at.

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Sale of ICQ Operations

On July 8, 2010, we completed the sale of our ICQ operations (“ICQ”) for $187.5 million in cash (subject to working capital adjustments). We expect to record a pre-tax gain on this sale of approximately $120 to $130 million within discontinued operations, a portion of which may be deferred for up to twelve months following the sale related to our obligation to provide certain transition services. ICQ provides online instant messaging services and products, as well as software related to such services and products, primarily to international online consumers. The financial condition, results of operations and cash flows of ICQ have been reflected as discontinued operations for all periods presented. The results of operations of ICQ were not material to our consolidated financial statements.

Sale of Bebo, Inc.

On June 16, 2010, we sold substantially all the assets of Bebo, Inc. (“Bebo”), resulting in a pre-tax loss of $2.2 million. We expect to treat the common stock of Bebo as worthless for U.S. income tax reporting purposes in our 2010 consolidated U.S. federal income tax return. Our current estimated U.S. income tax basis in Bebo is $767.1 million. As a result of the anticipated worthless stock deduction for the common stock of Bebo under U.S. income tax law, and in order to recognize the book and tax basis differences associated with our investment in Bebo, we recorded a deferred tax asset and corresponding income tax benefit of $302.7 million in the second quarter of 2010. See “Note 5” for additional information on the impact of the anticipated worthless stock deduction. Following this transaction, we expect to continue to generate advertising revenues on AOL Properties from customers who previously purchased advertising on Bebo properties and accordingly, under the accounting guidance for presentation of financial statements, the financial condition, results of operations and cash flows of Bebo have not been reflected as discontinued operations in the accompanying consolidated financial statements.

Sale of Digital Marketing Services, Inc.

On June 24, 2010, we completed the sale of Digital Marketing Services, Inc. (DMS), an online sample and specialized research provider, for a net sales price of $3.6 million, which resulted in a pre-tax gain of $2.2 million.

Sale of Investment in Kayak Software Corporation

On July 30, 2010, we entered into an agreement to sell our cost method investment in Kayak Software Corporation for $18.9 million in net cash proceeds. We expect to complete this sale in the third quarter of 2010 and expect to record a pre-tax gain of $17.5 million on this sale.

Restructuring Actions

We are in the midst of a significant restructuring initiative which began late in 2009 and we expect to complete in 2010. We have reduced our total workforce by nearly one-third in connection with this restructuring initiative, prior to hiring new employees in areas of strategic focus. As part of this initiative, we have reduced our cost base in the United Kingdom and have ceased or reduced operations in a number of other countries. In the first half of 2010, we reduced operations in France and Germany. We are continuing to operate certain French and German web properties and sell display advertising, leveraging our centralized European infrastructure; however, we expect advertising revenues generated in those countries to continue to decline in the near term.

In connection with this restructuring initiative, we incurred $11.1 million and $34.5 million of restructuring expense during the three and six months ended June 30, 2010, respectively, and expect to incur additional

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restructuring costs of up to $15.0 million during the remainder of 2010. As a result of ceasing operations in various international countries and shutting down legal entities in certain countries where we operate, we incurred a non-cash loss of $1.0 million and $2.1 million, respectively, for the three and six months ended June 30, 2010 related to the recognition of a portion of our cumulative foreign currency translation adjustments previously recognized in other comprehensive income. The potential impact of ceasing operations in certain international locations and shutting down legal entities may result in significant additional non-cash losses related to the recognition in our statement of operations of certain of our cumulative foreign currency translation adjustments previously recognized in other comprehensive income. As we continue to refine and optimize our assets and operations, we may identify additional restructuring actions separate and apart from the restructuring initiative which began in late 2009. If additional restructuring actions are identified, we would incur additional restructuring costs.

Goodwill Impairment Charge

During the three months ended June 30, 2010, we entered into an agreement to sell our ICQ operations and we completed the sale of substantially all of our assets of Bebo. In addition, subsequent to our announcement on April 28, 2010 of our financial results for the three months ended March 31, 2010, we experienced a significant decline in our stock price, and our stock price continued to trend lower through June 30, 2010. Our net assets also increased significantly during the three months ended June 30, 2010 due to cash generated from operations and the $302.7 million deferred tax asset associated with the anticipated Bebo worthless stock deduction. Based on these events, we concluded that it was more likely than not that the fair value of our single reporting unit was less than its carrying amount. As such, we performed a goodwill impairment test as of June 30, 2010.

Based on our interim impairment analysis, we have determined that, as of June 30, 2010 the carrying value of our goodwill was impaired and, accordingly, recorded a goodwill impairment charge of $1,414.4 million for the three months ended June 30, 2010 to write goodwill down to its implied fair value. See “Note 3” in our accompanying consolidated financial statements for additional information.

Results of Operations

The results of operations for the three and six months ended June 30, 2009 have been recast so that the basis of presentation is consistent with that of the results of operations for the three and six months ended June 30, 2010. This recast reflects the financial condition, results of operations and cash flows of buy.at and ICQ as discontinued operations for all periods presented.

Recent Accounting Standards

See “Note 1” in our accompanying consolidated financial statements for a discussion of recent accounting standards.

Consolidated Results

The following table presents our revenues, by revenue type, for the periods presented (in millions):

	Three Months Ended June 30,						Six Months Ended June 30,
	2010		2009		% Change		2010		2009		% Change
Revenues:
Advertising	$	296.9	$	407.2	(27	)%	$	642.7	$	838.9	(23	)%
Subscription		260.2		355.7	(27	)%		542.9		749.2	(28	)%
Other		27.0		28.6	(6	)%		53.7		58.7	(9	)%
Total revenues	$	584.1	$	791.5	(26	)%	$	1,239.3	$	1,646.8	(25	)%

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The following table presents our revenues, by revenue type, as a percentage of total revenues for the periods presented:

	Three Months Ended June 30,		Six Months Ended June 30,
	2010	2009	2010	2009
Revenues:
Advertising	51%	51%	52%	51%
Subscription	45	45	44	45
Other	4	4	4	4
Total revenues	100%	100%	100%	100%

Advertising Revenues

Advertising revenues are generated on AOL Properties through display advertising and search and contextual advertising. Display advertising revenue is generated by the display of graphical advertisements and other performance-based advertising. Search and contextual advertising revenue is generated when a user clicks on or views a text-based advertisement on the user’s screen. These text-based advertisements are either generated from a user-initiated search query or generated based on the content of the webpage the user is viewing. Agreements for advertising on AOL Properties typically take the form of impression-based contracts in which we provide impressions in exchange for a fixed fee (generally stated as cost-per-thousand impressions), time-based contracts in which we provide a minimum number of impressions over a specified time period for a fixed fee or performance-based contracts in which performance is measured in terms of either “click-throughs” when a user clicks on a company’s advertisement or other user actions such as product/customer registrations, survey participation, sales leads or product purchases. In addition, agreements with advertisers can include other advertising-related elements such as content sponsorships, exclusivities or advertising effectiveness research.

In addition to advertising revenues generated on AOL Properties, we also generate revenues from our advertising offerings on the Third Party Network. To generate revenues on the Third Party Network, we purchase advertising inventory from publishers (both large and small) in the Third Party Network using proprietary optimization, targeting and delivery technology to best match advertisers with available advertising inventory. We plan to expand the Third Party Network in order to allow us to serve many more publishers and advertisers than at present. Advertising arrangements for the sale of Third Party Network inventory typically take the form of impression-based contracts or performance-based contracts.

Advertising revenues on AOL Properties and the Third Party Network for the three and six months ended June 30, 2010 and 2009 are as follows (in millions):

	Three Months Ended June 30,						Six Months Ended June 30,
	2010		2009		% Change		2010		2009		% Change
AOL Properties:
Display	$	120.4	$	138.6	(13	)%	$	243.7	$	280.3	(13	)%
Search and Contextual		105.8		146.7	(28	)%		220.3		306.4	(28	)%
Total AOL Properties		226.2		285.3	(21	)%		464.0		586.7	(21	)%
Third Party Network		70.7		121.9	(42	)%		178.7		252.2	(29	)%
Total advertising revenues	$	296.9	$	407.2	(27	)%	$	642.7	$	838.9	(23	)%

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PART I - ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Advertising revenue declined $110.3 million and $196.2 million for the three and six months ended June 30, 2010, respectively, as compared to the same periods in 2009. Of this decline, approximately $70 million and $115 million, respectively, for the three and six months ended June 30, 2010 related to AOL-implemented initiatives to wind down or shut down certain products and shut down or reduce operations internationally. The most significant impact from these initiatives drove declines in Third Party Network revenue of $49.1 million and $77.2 million for the three and six months ended June 30, 2010, respectively, associated with European shutdowns and de-emphasis of the typically low margin search engine campaign management and lead generation affiliate products. In addition, we experienced declines in search and contextual revenue of $11.2 million and $24.9 million for the three and six months ended June 30, 2010, respectively, primarily due to the de-emphasis of our contextual products and fewer queries in Germany and France. International display revenues declined by $10.3 million and $13.7 million for the three and six months ended June 30, 2010, respectively, related to our reduced operations in Germany and France and continued declines from Bebo.

Separate from the above, advertising revenue reflects further declines in search and contextual and display revenue. Search and contextual revenue for the three and six months ended June 30, 2010, declined $29.7 million and $61.2 million, respectively, as compared to the same periods in 2009. These declines include $22.2 million and 48.4 million for the three and six months ended June 30, 2010, respectively, which reflect the impact of fewer domestic search queries related primarily to a 25% year-over-year decrease in domestic AOL-brand access subscribers, as well as lower traffic on certain AOL Properties. The search and contextual revenue declines also include $7.5 million and $12.8 million for the three and six months ended June 30, 2010, respectively, due to fewer queries in various countries including the United Kingdom. Domestic display revenue declines of $7.9 million and $19.7 million for the three and six months ended June 30, 2010, respectively, were due to the impact of less AOL Properties inventory monetized through the Third Party Network, resulting primarily from our efforts to improve the user experience.

For all periods presented in this Quarterly Report, we have had a contractual relationship with Google whereby we generate revenues through paid text-based search and contextual advertising on AOL Properties provided by Google, which represent a significant percentage of the advertising revenues generated by AOL Properties. For the three and six months ended June 30, 2010, the revenues associated with the Google relationship (substantially all of which were search and contextual revenues generated on AOL Properties) were $98.5 million and $209.0 million, respectively, as compared to the three and six months ended June 30, 2009, where such revenues were $132.5 million and $274.9 million, respectively.

We expect that our advertising revenues on both AOL Properties and the Third Party Network will continue to decline significantly for the remainder of 2010 as compared to the same periods in 2009. We believe that advertising revenues generated on AOL Properties will be negatively impacted by the restructuring of our advertising organization, the decline in our domestic AOL-brand access subscribers, particularly as it relates to search and contextual revenues, and the decline in international operations due to ceasing or reducing operations in a number of countries. Visibility into advertising revenue for the remainder of 2010 is limited due to the impact of the restructuring of our advertising organization, mentioned above, and the fact that many advertising agreements are executed during the quarter that the advertising is displayed. Finally, we expect our Third Party Network revenues will be negatively impacted for the remainder of 2010 by the international reductions and closures previously discussed as well as the de-emphasis of our search engine campaign management and lead generation affiliate products, which are discussed in “Overview—Our Business—Third Party Network” above.

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PART I - ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Subscription Revenues

Subscription revenues declined 27% and 28% for the three and six months ended June 30, 2010, respectively, as compared to the same periods in 2009. The decline was due to an approximate 25% decrease in the number of domestic AOL-brand access subscribers between June 30, 2009 and June 30, 2010 (which is discussed further in “Overview—Our Business—AOL Properties”).

The number of domestic AOL-brand access subscribers was 4.4 million and 5.8 million at June 30, 2010 and June 30, 2009, respectively. The domestic average monthly revenue per AOL-brand access subscriber (which we refer to in this Quarterly Report as ARPU) was $18.10 and $18.21 for the three and six months ended June 30, 2010, respectively, compared to $18.27 and $18.38 for the three and six months ended June 30, 2009, respectively. We include in our subscriber numbers individuals, households and entities that have provided billing information and completed the registration process sufficiently to allow for an initial log-on to the AOL access service. Individuals who have registered for our free offerings, including subscribers who have migrated from paid subscription plans, are not included in the AOL-brand access subscriber numbers presented above. Subscribers to our subscription access service contribute to our ability to generate advertising revenues.

Other Revenues

Other revenues consist primarily of fees associated with our mobile e-mail and instant messaging functionality from mobile carriers, licensing revenues from third-party customers from MapQuest’s business-to-business services and licensing revenues from licensing our proprietary ad serving technology to third parties through our subsidiary, ADTECH AG. In addition, other revenues include amounts associated with hosting certain Time Warner websites on our servers as part of the transition services provided to Time Warner.

Other revenues decreased 6% and 9% for the three and six months ended June 30, 2010, as compared to the three and six months ended June 30, 2009, respectively, due to reduced monetization of mobile revenues of $2.5 million and $11.6 million, respectively, and a decline in licensing revenues from MapQuest’s business-to-business services of $1.9 million and $3.7 million, respectively. These declines were partially offset by increases in third party web hosting revenues of $2.7 million and $4.2 million, respectively, for the three and six months ended June 30, 2010, and for the six months ended June 30, 2010, an increase due to the timing of fees earned from mobile carriers of $4.5 million.

Geographical Concentration of Revenues

For the periods presented herein, a significant majority of our revenues have been generated in the United States. Substantially all of the non-United States revenues for these periods were generated by our European operations (primarily in the United Kingdom, France and Germany). We expect the significant majority of our revenues to continue to be generated in the United States for the foreseeable future. See “Note 1” in our accompanying consolidated financial statements for further discussion of our geographical concentrations.

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PART I - ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Operating Costs and Expenses

The following table represents our operating costs and expenses as a percentage of revenues for the periods presented:

	Three Months Ended June 30,		Six Months Ended June 30,
	2010	2009	2010	2009
Operating costs and expenses:
Costs of revenues	57%	58%	56%	57%
Selling, general and administrative	22	16	21	16
Amortization of intangible assets	6	4	8	4
Amounts related to securities litigation and government investigations, net of recoveries	-	1	-	1
Restructuring costs	2	2	3	4
Subtotal of operating costs and expenses before goodwill impairment charge	87%	81%	88%	82%
Goodwill impairment charge	242	-	114	-
Total operating costs and expenses	329%	81%	202%	82%

The following table presents our operating costs and expenses for the periods presented (in millions):

	Three Months Ended June 30,						Six Months Ended June 30,
	2010		2009		% Change		2010		2009		% Change
Costs of revenues	$	333.3	$	460.9	(28	)%	$	695.8	$	942.6	(26	)%
Selling, general and administrative		126.1		122.4	3	%		257.4		258.4	(0	)%
Amortization of intangible assets		35.7		33.3	7	%		97.9		68.1	44	%
Amounts related to securities litigation and government investigations, net of recoveries		-		6.8	(100	)%		-		14.2	(100	)%
Restructuring costs		11.1		14.4	(23	)%		34.5		72.7	(53	)%
Goodwill impairment charge		1,414.4		-	NM			1,414.4		-	NM

NM = not meaningful

Costs of Revenues

The following categories of costs are generally included in costs of revenues: network-related costs, TAC, product development costs and other costs of revenues. The largest component of our costs of revenues is generally TAC, which consists of costs incurred through arrangements in which we acquire third-party online advertising inventory for resale and arrangements whereby partners distribute our free products or services or otherwise direct traffic to AOL Properties. TAC arrangements have a number of different economic structures, the most common of which are: payments based on a cost-per-thousand impressions or based on a percentage of the ultimate advertising revenues generated from the advertising inventory acquired for resale, payments for direct traffic delivered to AOL Properties priced on a per click basis (e.g., search engine marketing fees) and payments to partners in exchange for distributing our products to their users (e.g., agreements with computer manufacturers to distribute our toolbar or a co-branded web portal on computers shipped to end users). These arrangements can be on a fixed-fee basis (which often carry reciprocal performance guarantees by the counterparty), on a variable basis or, in some cases, a combination of the two.

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PART I - ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Costs of revenues decreased $127.6 million and $246.8 million, respectively, for the three and six months ended June 30, 2010, as compared to the same periods in 2009. The primary drivers of the decrease in costs of revenues were decreases in TAC, network-related costs and personnel costs. TAC decreased by $65.3 million and $109.0 million, respectively, for the three and six months ended June 30, 2010, as compared to the same periods in 2009. TAC was impacted by the decrease in advertising revenues, which drove a decline of $40.9 million and $65.6 million, respectively, primarily due to variable revenue share payments to our publishing partners, for the three and six months ended June 30, 2010, as compared to the same periods in 2009. In addition, there were declines from a significant product distribution agreement, whereby payments previously were based on the number of personal computers shipped. Under the agreement, which was amended during the first quarter of 2010, new distributions have ceased and payments will be based on a percentage of the advertising revenue we earn on the associated co-branded website. As a result, TAC associated with this agreement declined by $21.2 million and $42.6 million, respectively, for the three and six months ended June 30, 2010, as compared to the same periods in 2009. Personnel costs, including salaries and bonuses, declined by $40.6 million and $82.0 million, respectively, for the three and six months ended June 30, 2010, as compared to the same periods in 2009, due to reduced headcount as a result of our 2009 restructuring initiatives. Network-related costs declined by $20.7 million and $45.1 million, respectively, for the three and six months ended June 30, 2010, as compared to the same periods in 2009, due to declines in depreciation expense on network equipment including the impact of accelerated depreciation on certain network assets in 2009 as a result of our reevaluation of the useful lives of those assets and declines in narrowband network and other network-related costs, partially due to the decline in domestic AOL-brand access subscribers.

Selling, General and Administrative

Selling, general and administrative expenses increased $3.7 million for the three months ended June 30, 2010, as compared to the three months ended June 30, 2009, due to an increase in marketing costs of $4.0 million primarily associated with our rebranding efforts and an increase in external legal and consulting costs of $3.3 million primarily associated with our evaluation of strategic alternatives for ICQ and Bebo, partially offset by declines in personnel costs of $4.6 million. Personnel cost declines were due to reduced headcount of $13.4 million as a result of our 2009 restructuring initiatives, partially offset by an increase in equity-based compensation expense of $5.3 million and an increase in recruiting expenses of $2.1 million.

Selling, general and administrative expenses decreased $1.0 million for the six months ended June 30, 2010, as compared to the six months ended June 30, 2009, due to declines in personnel costs of $13.0 million offset by an increase in marketing costs of $5.5 million primarily associated with our rebranding efforts and an increase in external legal and consulting costs of $5.5 million primarily associated with our evaluation of strategic alternatives for ICQ and Bebo. The decline in personnel costs was due to reduced headcount of $23.9 million as a result of our 2009 restructuring initiatives, partially offset by an increase in equity-based compensation expense of $10.3 million.

Amortization of Intangible Assets

Amortization of intangible assets results primarily from acquired intangible assets including technology, customer relationships and trade names. Amortization of intangible assets increased $2.4 million and $29.8 million for the three and six months ended June 30, 2010, respectively, as compared to the same periods in 2009, due to our reevaluation of the useful lives of certain intangible assets in the fourth quarter of 2009 in connection with our restructuring initiatives, which resulted in incremental amortization expense of $7.1 million and $40.0 million for the three and six months ended June 30, 2010, respectively. The increase was partially offset by a decline due to certain intangible assets becoming fully amortized in 2009.

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PART I - ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Amounts Related to Securities Litigation and Government Investigations, Net of Recoveries

Amounts related to securities litigation and government investigations, net of recoveries consist of legal settlement costs and legal and other professional fees incurred by Time Warner prior to the spin-off related to the defense of various securities lawsuits involving us or our or Time Warner’s present or former officers and employees. While these amounts were historically incurred by Time Warner and reflected in Time Warner’s financial results, they have been reflected as an expense and a corresponding additional capital contribution by Time Warner in our consolidated financial statements for the periods when we were a wholly-owned subsidiary of Time Warner because they involve us. We recognized $6.8 million and $14.2 million of expense related to these matters, respectively, for the three and six months ended June 30, 2009. Following the spin-off, these costs continue to be incurred by Time Warner to the extent that proceeds from a settlement with insurers are available to pay those costs, and thereafter AOL has an obligation to indemnify Time Warner for such costs to the extent they are associated with present or former officers and employees of AOL. We do not view our remaining potential obligation related to this matter to be material.

Restructuring Costs

In connection with our restructuring initiatives, we incurred restructuring costs of $11.1 million and $34.5 million, respectively, for the three and six months ended June 30, 2010 and $14.4 million and $72.7 million, respectively, for the three and six months ended June 30, 2009, related to voluntary and involuntary employee terminations, facility closures and contract termination costs. We expect to incur additional restructuring costs of up to $15.0 million during the remainder of 2010 in connection with the restructuring initiative that began in late 2009.

Goodwill Impairment Charge

During the three months ended June 30, 2010, we entered into an agreement to sell our ICQ operations and we completed the sale of substantially all of our assets of Bebo. In addition, subsequent to our announcement on April 28, 2010 of our financial results for the three months ended March 31, 2010, we experienced a significant decline in our stock price, and our stock price continued to trend lower through June 30, 2010. Our net assets also increased significantly during the three months ended June 30, 2010 due to cash generated from operations and the $302.7 million deferred tax asset associated with the anticipated Bebo worthless stock deduction. Based on these events, we concluded that it was more likely than not that the fair value of our single reporting unit was less than its carrying amount. As such, we performed an interim goodwill impairment test as of June 30, 2010.

Based on our interim impairment analysis, we have determined that, as of June 30, 2010, the carrying value of our goodwill was impaired and, accordingly, we recorded a goodwill impairment charge of $1,414.4 million for the three months ended June 30, 2010 to write goodwill down to its implied fair value. See “Note 3” in our accompanying consolidated financial statements for additional information.

Operating Income (Loss)

Operating loss was $1,336.5 million for the three months ended June 30, 2010, as compared to operating income of $153.7 million during the three months ended June 30, 2009. Operating loss was $1,260.7 million for the six months ended June 30, 2010, as compared to operating income of $290.8 million for the six months ended June 30, 2009. These declines were due to the goodwill impairment charge recorded in the second quarter of 2010 and the decline in revenues, partially offset by decreases in costs of revenues.

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PART I - ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Other Income Statement Amounts

The following table presents our other income statement amounts for the periods presented (in millions):

	Three Months Ended June 30,						Six Months Ended June 30,
	2010			2009		% Change	2010			2009		% Change
Other income (loss), net	$	(4.3	)	$	5.4	NM	$	(7.0	)	$	2.2	NM
Income tax provision (benefit)		(269.3	)		70.8	NM		(234.0	)		124.3	NM
Discontinued operations, net of tax		16.5			2.4	NM		13.4			4.5	NM

Other Income (Loss), Net

Other loss, net was $4.3 million for the three months ended June 30, 2010, as compared to other income of $5.4 million for the three months ended June 30, 2009. Other loss, net was $7.0 million for the six months ended June 30, 2010, as compared to other income of $2.2 million for the six months ended June 30, 2009. These changes were due to foreign currency transaction losses and credit facility fees offset by transaction costs incurred in 2009 related to the spin-off.

Income Tax Provision (Benefit)

We recorded a loss from continuing operations before income taxes of $1,340.8 million and $1,267.7 million for the three and six months ended June 30, 2010, respectively. Included in this loss was a goodwill impairment charge of $1,414.4 million, the majority of which is not deductible for income tax purposes. In addition, we recorded an income tax benefit for the three and six months ended June 30, 2010 of $269.3 million and $234.0 million, respectively, of which $302.7 million is related to a deferred tax asset associated with the anticipated Bebo worthless stock deduction. This deferred tax asset is expected to be used to offset our ordinary income and capital gains, which is expected to ultimately result in cash tax savings by offsetting future U.S. federal and state income tax obligations through the anticipated worthless stock deduction. As a result of these items, the effective tax rates for the three and six months ended June 30, 2010 are significantly lower than the statutory U.S. federal income tax rate of 35.0%.

Our effective tax rates for income from continuing operations, including the effect of the deferred tax asset related to the anticipated worthless stock deduction and the goodwill impairment charge, were 20.1% and 18.5% for the three and six months ended June 30, 2010, as compared to 44.5% and 42.4% for the three and six months ended June 30, 2009, respectively. The effective tax rates differed from the statutory U.S. federal income tax rate of 35.0% and the effective tax rate for the three and six months ended June 30, 2009 primarily due to the effect of the anticipated worthless stock deduction and an increase in the U.S. benefit of foreign branch losses, partially offset by the effect of the goodwill impairment charge (the majority of which was non-deductible for income tax purposes).

For the three and six months ended June 30, 2010, we recorded an income tax benefit on discontinued operations of $12.9 million and $23.3 million, respectively. Of these amounts, $15.0 million and $19.8 million for the three and six months ended June 30, 2010, respectively, related to the reversal of a valuation allowance on the capital loss deferred tax asset recorded in connection with the sale of buy.at. We reversed this portion of the valuation allowance because we believe it is more likely than not we will utilize a portion of the capital loss to offset future capital gains. See “Note 4” for additional information on the sale of buy.at and related capital loss deferred tax assets.

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PART I - ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Discontinued Operations, Net of Tax

The financial results for the three and six months ended June 30, 2010 and 2009 include the impact of reflecting the results of operations, financial condition and cash flows of buy.at and ICQ as discontinued operations. We completed the sale of buy.at on February 26, 2010 and accordingly, the six months ended June 30, 2010 included the loss on the sale as well as the results of buy.at for the period from January 1, 2010 through February 26, 2010. Both the three and six months ended June 30, 2010 include the results of ICQ as it was not sold until July 8, 2010. See “Note 4” in our accompanying consolidated financial statements for more information regarding these divestitures.

Adjusted OIBDA

We use Adjusted OIBDA as a supplemental measure of our performance. We define Adjusted OIBDA as operating income before depreciation and amortization excluding the impact of gains and losses on all disposals of assets (including those recorded in costs of revenues) and non-cash asset impairments. We consider Adjusted OIBDA to be a useful metric for management and investors to evaluate and compare the ongoing operating performance of our business on a consistent basis across reporting periods, as it eliminates the effect of non-cash items such as depreciation of tangible assets, amortization of intangible assets that were primarily recognized in business combinations and asset impairments, as well as the effect of gains and losses on asset sales, which we do not believe are indicative of our core operating performance. A limitation of this measure, however, is that it does not reflect the periodic costs of certain capitalized tangible and intangible assets used in generating revenues in our business. Moreover, the Adjusted OIBDA measures do not reflect gains and losses on asset sales or impairment charges related to goodwill, intangible assets and fixed assets. We evaluate the investments in such tangible and intangible assets through other financial measures, such as capital expenditure budgets, investment spending levels and return on capital.

Adjusted OIBDA is defined as a non-GAAP financial measure by the SEC and may be different than similarly-titled non-GAAP financial measures used by other companies. The presentation of this financial information is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with generally accepted accounting principles (GAAP).

The following table presents our reconciliation of Adjusted OIBDA to operating income (in millions):

	Three Months Ended June 30,								Six Months Ended June 30,
	2010			2009			% Change		2010			2009			% Change
Operating income	$	(1,336.5	)	$	153.7		NM		$	(1,260.7	)	$	290.8		NM
Add: Depreciation		51.6			71.9		(28	)%		105.2			140.0		(25	)%
Add: Amortization of intangible assets		35.7			33.3		7	%		97.9			68.1		44	%
Add: Asset impairments		1,415.9			4.3		NM			1,417.3			6.6		NM
Add: Losses/(gains) on asset sales		(0.1	)		(0.4	)	(75	)%		(0.5	)		(0.6	)	(17	)%
Adjusted OIBDA	$	166.6		$	262.8		(37	)%	$	359.2		$	504.9		(29	)%

Adjusted OIBDA declined for the three and six months ended June 30, 2010 as compared to the same periods in 2009 due to the declines in advertising and subscription revenues discussed above, partially offset by lower TAC, network-related costs and personnel costs.

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PART I - ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Liquidity and Capital Resources

Current Financial Condition

Historically, the cash we generate has been sufficient to fund our working capital, capital expenditure and financing requirements. While our ability to forecast future cash flows is limited, we expect to fund our ongoing working capital, capital expenditure and financing requirements through cash flows from operations. Until its expiration in December 2010, we also have available to us the $250 million senior secured revolving credit facility (the “Revolving Credit Facility”) entered into in connection with the spin-off. See “Principal Debt Obligations” for additional information on the Revolving Credit Facility. While we expect to continue to generate positive cash flows from operations, we expect our cash flows from operations to decline over the next several years principally due to the continued decline in the number of domestic AOL-brand access subscribers as well as a projected decline in search and contextual advertising revenues. Growth in cash flows from operations will only be achieved when, and if, the growth in earnings from our online advertising services more than offsets the continued decline in domestic AOL-brand access subscribers. In order for us to achieve such increase in earnings from advertising services, we believe it will be important to increase our overall volume of display advertising sold, including through our higher-priced channels, and to maintain or increase pricing for advertising. Advertising revenues, however, are more unpredictable and variable than our subscription revenues, and are more likely to be adversely affected during economic downturns, as spending by advertisers tends to be cyclical in line with general economic conditions. If we are unable to successfully implement our strategic plan and grow the earnings generated by our online advertising services, we may need to reassess our cost structure or seek other financing alternatives to fund our business. As part of our ongoing assessment of our business and availability of capital and to enhance our liquidity position, we have divested of certain assets and product lines and may consider divesting of additional assets or product lines.

At June 30, 2010, our cash and equivalents totaled $391.6 million, as compared to $143.3 million at December 31, 2009.

Summary Cash Flow Information

Our cash flows from operations are driven by net income adjusted for non-cash items such as depreciation, amortization, goodwill impairment, equity-based compensation expense and other activities impacting net income such as the gains and losses on the sale of assets or operating subsidiaries. Cash flows from investing activities consist primarily of the cash used in the acquisitions of various businesses as part of our strategy, proceeds received from the sale of assets or operating subsidiaries and cash used for capital expenditures. Cash flows from financing activities prior to the spin-off relate primarily to our distributions of cash to Time Warner as part of our historical cash management and treasury operations and for all periods, payments made on capital lease obligations.

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PART I - ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Operating Activities

The following table presents cash provided by continuing operations for the periods presented (in millions):

	Six Months Ended June 30,
	2010			2009
Net income (loss)	$	(1,020.3	)	$	173.2
Less: Discontinued operations, net of tax		13.4			4.5
Net income (loss) from continuing operations		(1,033.7	)		168.7
Adjustments for non-cash and non-operating items:
Depreciation and amortization		203.1			208.1
Non-cash asset impairments		1,417.3			6.6
Non-cash equity-based compensation		18.8			7.8
Amounts related to securities litigation and government investigations, net of recoveries		-			14.2
Excess tax benefit on equity-based compensation		(1.5	)		-
Deferred income taxes		(418.4	)		4.0
All other, net, including working capital changes		125.0			174.9
Cash provided by continuing operations	$	310.6		$	584.3

Cash provided by continuing operations decreased $273.7 million for the six months ended June 30, 2010, as compared to the six months ended June 30, 2009. Our operating loss was $1,260.7 million for the six months ended June 30, 2010, a decrease of $1,551.5 million as compared to the six months ended June 30, 2009. Excluding the declines in operating income related to the $1,414.4 million non-cash goodwill impairment charge in 2010, operating income decreased by $137.1 million. This decrease in operating income along with the decrease in cash provided by changes in working capital drove the decline in cash provided by continuing operations. The decrease in cash provided by working capital was due primarily to cash payments in 2010 for employee bonus costs and restructuring costs incurred in 2009 and paid in 2010.

Investing Activities

The following table presents cash used by investing activities for the periods presented (in millions):

	Six Months Ended June 30,
	2010			2009
Investments and acquisitions, net of cash acquired	$	(24.2	)	$	(15.7	)
Capital expenditures and product development costs		(43.4	)		(65.9	)
Investment activities from discontinued operations		12.9			(1.7	)
Other investment proceeds		4.8			0.7
Cash used by investing activities	$	(49.9	)	$	(82.6	)

Cash used by investing activities decreased $32.7 million for the six months ended June 30, 2010, as compared to the same period in 2009, due to the proceeds received in the six months ended June 30, 2010 from the sale of buy.at and a decrease in capital expenditures and product development costs, partially offset by an increase in cash used for acquisitions.

Capital expenditures and product development costs are mainly for the purchase of computer hardware, software, network equipment, furniture, fixtures and other office equipment.

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AOL INC.

PART I - ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Financing Activities

The following table presents cash used by financing activities for the periods presented (in millions):

	Six Months Ended June 30,
	2010			2009
Principal payments on capital leases	$	(17.0	)	$	(14.8	)
Net distribution to Time Warner		-			(554.6	)
Excess tax benefit on equity-based compensation		1.5			-
Other		-			(10.3	)
Cash used by financing activities	$	(15.5	)	$	(579.7	)

Cash used by financing activities was $15.5 million for the six months ended June 30, 2010, compared to $579.7 million for the six months ended June 30, 2009. This change was due to the $554.6 million of net cash distributed to Time Warner in the six months ended June 30, 2009, as we swept the majority of our domestic cash to Time Warner prior to the spin-off.

Free Cash Flow

We use Free Cash Flow as a supplemental measure of our performance. We define Free Cash Flow as cash provided by continuing operations, less capital expenditures, product development costs and principal payments on capital leases. We consider Free Cash Flow to be a liquidity measure that provides useful information to management and investors about the amount of cash generated by the business that, after capital expenditures, capitalized product development costs and principal payments on capital leases, can be used for strategic opportunities, including investing in our business, making strategic acquisitions, and strengthening the balance sheet. Analysis of Free Cash Flow also facilitates management’s comparisons of our operating results to competitors’ operating results. A limitation on the use of this metric is that Free Cash Flow does not represent the total increase or decrease in cash for the period because it excludes certain non-operating cash flows.

Free Cash Flow is defined as a non-GAAP financial measure by the SEC and may be different than similarly-titled non-GAAP financial measures used by other companies. The presentation of this financial information is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP.

The following table presents our reconciliation of Free Cash Flow to cash provided by continuing operations (in millions):

	Six Months Ended June 30,
	2010		2009
Cash provided by continuing operations	$	310.6	$	584.3
Less: Capital expenditures and product development costs		43.4		65.9
Less: Principal payments on capital leases		17.0		14.8
Free Cash Flow	$	250.2	$	503.6

Free Cash Flow decreased for the six months ended June 30, 2010 as compared to the six months ended June 30, 2009. This decrease is due to the decline in cash provided by continuing operations, discussed in “Summary Cash Flow Information—Operating Activities” above, partially offset by reduced capital expenditures and product development costs.

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AOL INC.

PART I - ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Principal Debt Obligations

On December 9, 2009, in connection with the spin-off, we entered into the Revolving Credit Facility, which we intend to use, as necessary, for general corporate purposes. Time Warner has guaranteed all of our obligations under the Revolving Credit Facility, pursuant to a guarantee dated as of December 9, 2009. The maturity date of the Revolving Credit Facility is December 8, 2010. Loans made under the Revolving Credit Facility will bear interest at a fluctuating rate based on the applicable rating for the senior unsecured long-term debt of Time Warner. From December 9, 2009 (the date of the spin-off) through August 4, 2010, we have not borrowed under the terms of the Revolving Credit Facility. See “Note 5” to our audited consolidated financial statements in our Annual Report for additional information. Given our cash balance at June 30, 2010 and our projected future cash flow from operations, we are in the process of evaluating our financing alternatives upon expiration of our Revolving Credit Facility. See “Item 1A—Risk Factors—Risks Relating to Our Business—We may need to raise additional capital, and we cannot be sure that additional financing will be available” included in our Annual Report.

Customer Credit Risk

Customer credit risk represents the potential for financial loss if a customer is unwilling or unable to meet its agreed-upon contractual payment obligations. Credit risk originates from sales of advertising and subscription access service and is dispersed among many different counterparties. No single customer had a receivable balance at June 30, 2010 greater than 10% of total net receivables. While such uncollectible amounts have historically been within our expectations and related reserve balances, if there is a significant change in uncollectible amounts in the future or the financial condition of our counterparties across various industries or geographies deteriorates, these events could have an adverse impact on our operating results and cash flows.

Critical Accounting Policies

Our consolidated financial statements are prepared in accordance with GAAP, which require management to make estimates, judgments and assumptions that affect the amounts reported in the consolidated financial statements and the accompanying notes. Management considers an accounting policy to be critical if it is important to our financial condition and results of operations, and if it requires significant judgment and estimates on the part of management in its application. The development and selection of these critical accounting policies have been determined by our management. Due to the significant judgment involved in selecting certain of the assumptions used in these areas, it is possible that different parties could choose different assumptions and reach different conclusions. Our critical accounting policies relate to: (a) gross versus net revenue recognition; (b) impairment of goodwill; and (c) income taxes. The following discussion is an update to the discussion in our Annual Report regarding our critical accounting policies related to the impairment of goodwill. For additional information about our other critical accounting policies and our significant accounting policies, see “Item 7—MD&A—Critical Accounting Policies” and “Note 1” to our audited consolidated financial statements in our Annual Report.

Impairment of Goodwill

Goodwill is tested annually for impairment during the fourth quarter or earlier upon the occurrence of certain events or substantive changes in circumstances that indicate goodwill is more likely than not impaired. Such indicators may include a sustained, significant decline in our stock price; a decline in our expected future cash flows; significant disposition activity; a significant adverse change in the economic or business environment; the testing for recoverability of a significant asset group, among others. The occurrence of these indicators could have a significant impact on the recoverability of goodwill and could have a material impact on our consolidated financial statements.

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PART I - ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

For purposes of our goodwill impairment test, we operate as a single reporting unit. Different judgments relating to the determination of reporting units could significantly affect the testing of goodwill for impairment and the amount of any impairment recognized.

Goodwill impairment is determined using a two-step process. The first step involves a comparison of the estimated fair value of our reporting unit to its carrying amount, including goodwill. If the estimated fair value of our reporting unit exceeds its carrying amount, goodwill of the reporting unit is not impaired and the second step of the impairment test is not necessary. If the carrying amount of our reporting unit exceeds its estimated fair value, then the second step of the goodwill impairment test must be performed. To measure the amount of impairment loss, if any, we determine the implied fair value of goodwill in the same manner as if our reporting unit were being acquired in a business combination. Specifically, the estimated fair value of the reporting unit is allocated to all of the assets and liabilities of that unit (including any unrecognized intangible assets) as if the reporting unit had been acquired in a business combination and the fair value of the reporting unit was the purchase price paid. If the carrying amount of the reporting unit’s goodwill exceeds the implied fair value of that goodwill, an impairment loss is recognized in an amount equal to that excess.

During the three months ended June 30, 2010, we entered into an agreement to sell our ICQ operations and we completed the sale of substantially all of our assets of Bebo. In addition, subsequent to our announcement on April 28, 2010 of our financial results for the three months ended March 31, 2010, we experienced a significant decline in our stock price, and our stock price continued to trend lower through June 30, 2010. Based on these events, we determined that it was more likely than not that the fair value of our single reporting unit was less than its carrying amount and accordingly, we performed an interim goodwill impairment test as of June 30, 2010.

The estimated fair value of our reporting unit was determined utilizing a market-based approach, as the primary input in this approach was a quoted market price in an active market. To determine the estimated fair value of our reporting unit, we calculated our market capitalization based on our stock price and adjusted it by a control premium of 25%. The premium used to arrive at a controlling interest equity value was determined based on values observed in recent market transactions. Determining fair value of our reporting unit requires the exercise of significant judgment, primarily related to the premium used to arrive at a controlling interest equity value used in the market-based approach. Significant changes in the estimates and assumptions used in deriving our control premium could materially affect the determination of fair value for our reporting unit which could impact the magnitude of an impairment loss recognized or trigger future impairment. Due to the significant judgments used in deriving our control premium, the fair value of our single reporting unit determined in connection with the goodwill impairment test may not necessarily be indicative of the actual value that would be recognized in any future transaction.

Based on our interim impairment analysis as of June 30, 2010, we have determined that the carrying value of our reporting unit exceeded its fair value. Accordingly, step two of the goodwill impairment test was performed, where we used an independent valuation specialist to assist us in determining the fair value of our individual assets and liabilities in order to perform a “hypothetical purchase price allocation” assuming that the estimated fair value of the reporting unit was the purchase price paid. The implied fair value of goodwill in the hypothetical purchase price allocation was calculated by comparing the estimated fair value of the reporting unit to the aggregate fair value of recorded assets and liabilities and unrecognized identifiable intangible assets. Our unrecognized identifiable intangible assets consisted primarily of subscribers to our access service, advertiser relationships and technology related to our advertising operations, and the fair value of such assets had the effect of increasing the magnitude of our goodwill impairment charge. Determining the fair value of these unrecognized intangible assets in the step two evaluation requires significant judgment, including judgments about appropriate discount rates and our estimated future cash flows, which are subject to change. As a result of our step two evaluation, we recorded a goodwill impairment charge of $1,414.4 million for the three months ended June 30, 2010.

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AOL INC.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

There have been no material changes in market risk from the information provided in Part I, Item 3 “Quantitative and Qualitative Disclosures About Market Risk” in our Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2010.

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AOL INC.

ITEM 4T. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that the information we are required to disclose in our financial reports is recorded, processed, summarized and reported within the time periods specified by the SEC rules and forms, and that such information is accumulated and communicated to senior management, as appropriate, to allow timely decisions regarding required disclosure. Management is responsible for establishing and maintaining effective disclosure controls and procedures, as defined under Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934, as amended. Any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives. Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of the design and operation of our disclosure controls and procedures as of June 30, 2010. Based on that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective as of June 30, 2010, at a reasonable assurance level.

Changes to Internal Control Over Financial Reporting

We have evaluated the changes in our internal control over financial reporting that occurred during the three months ended June 30, 2010 and concluded that there have not been any changes that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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AOL INC.

ITEM 1. FINANCIAL STATEMENTS

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited; In millions, except per share amounts)

	Three Months Ended June 30,					Six Months Ended June 30,
	2010			2009		2010			2009
				(recast)					(recast)
Revenues:
Advertising	$	296.9		$	407.2	$	642.7		$	838.9
Subscription		260.2			355.7		542.9			749.2
Other		27.0			28.6		53.7			58.7
Total revenues		584.1			791.5		1,239.3			1,646.8
Costs of revenues		333.3			460.9		695.8			942.6
Selling, general and administrative		126.1			122.4		257.4			258.4
Amortization of intangible assets		35.7			33.3		97.9			68.1
Amounts related to securities litigation and government investigations, net of recoveries		-			6.8		-			14.2
Restructuring costs		11.1			14.4		34.5			72.7
Goodwill impairment charge		1,414.4			-		1,414.4			-
Operating income (loss)		(1,336.5	)		153.7		(1,260.7	)		290.8
Other income (loss), net		(4.3	)		5.4		(7.0	)		2.2
Income (loss) from continuing operations before income taxes		(1,340.8	)		159.1		(1,267.7	)		293.0
Income tax provision (benefit)		(269.3	)		70.8		(234.0	)		124.3
Income (loss) from continuing operations		(1,071.5	)		88.3		(1,033.7	)		168.7
Discontinued operations, net of tax		16.5			2.4		13.4			4.5
Net income (loss)		(1,055.0	)		90.7		(1,020.3	)		173.2
Less: Net loss attributable to noncontrolling interests		-			-		-			0.2
Net income (loss) attributable to AOL Inc.	$	(1,055.0	)	$	90.7	$	(1,020.3	)	$	173.4
Amounts attributable to AOL Inc.:
Income (loss) from continuing operations	$	(1,071.5	)	$	88.3	$	(1,033.7	)	$	168.9
Discontinued operations, net of tax		16.5			2.4		13.4			4.5
Net income (loss) attributable to AOL Inc.	$	(1,055.0	)	$	90.7	$	(1,020.3	)	$	173.4
Per share information attributable to AOL Inc. common stockholders:
Basic and diluted income (loss) per common share from continuing operations	$	(10.04	)	$	0.84	$	(9.71	)	$	1.60
Discontinued operations, net of tax		0.15			0.02		0.13			0.04
Basic and diluted net income (loss) per common share	$	(9.89	)	$	0.86	$	(9.58	)	$	1.64
Shares used in computing basic and diluted income per common share		106.7			105.8		106.5			105.8

See accompanying notes.

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AOL INC.

ITEM 1. FINANCIAL STATEMENTS

CONSOLIDATED BALANCE SHEETS

(In millions, except per share amounts)

	June 30, 2010			December 31, 2009
	(unaudited)			(recast)
Assets
Current assets:
Cash and equivalents	$	391.6		$	143.3
Accounts receivable, net of allowances of $24.6 and $31.4, respectively		295.2			436.1
Prepaid expenses and other current assets		36.2			33.1
Deferred income taxes		197.6			44.7
Current assets of discontinued operations		8.3			30.2
Total current assets		928.9			687.4
Property and equipment, net		640.2			700.7
Goodwill		702.9			2,119.1
Intangible assets, net		116.2			210.4
Long-term deferred income taxes		415.6			153.9
Long-term assets of discontinued operations		57.7			83.8
Other long-term assets		34.5			24.9
Total assets	$	2,896.0		$	3,980.2
Liabilities and Equity
Current liabilities:
Accounts payable	$	76.6		$	100.1
Accrued compensation and benefits		81.6			89.0
Accrued expenses and other current liabilities		399.0			398.9
Deferred revenue		122.7			112.6
Current portion of obligations under capital leases		32.5			32.4
Current liabilities of discontinued operations		3.4			18.4
Total current liabilities		715.8			751.4
Obligations under capital leases		36.5			41.5
Restructuring liabilities		10.6			28.3
Deferred income taxes		1.0			2.4
Long-term liabilities of discontinued operations		22.9			24.3
Other long-term liabilities		74.8			69.4
Total liabilities		861.6			917.3
Commitments and contingencies (See Note 9)
Equity:
Common stock, $0.01 par value, 106.7 million and 105.8 million shares issued and outstanding at June 30, 2010 and December 31, 2009, respectively		1.1			1.1
Additional paid-in capital		3,369.3			3,355.5
Accumulated other comprehensive loss, net		(295.3	)		(275.1	)
Accumulated deficit for the period subsequent to November 2, 2009		(1,040.7	)		(20.4	)
Total AOL Inc. stockholders’ equity		2,034.4			3,061.1
Noncontrolling interest		-			1.8
Total equity		2,034.4			3,062.9
Total liabilities and equity	$	2,896.0		$	3,980.2

See accompanying notes.

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AOL INC.

ITEM 1. FINANCIAL STATEMENTS

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited; In millions)

	Six Months Ended June 30,
	2010			2009
				(recast)
Operations
Net income (loss)	$	(1,020.3	)	$	173.2
Less: Discontinued operations, net of tax		13.4			4.5
Net income (loss) from continuing operations		(1,033.7	)		168.7
Adjustments for non-cash and non-operating items:
Depreciation and amortization		203.1			208.1
Asset impairments		1,417.3			6.6
Equity-based compensation		18.8			7.8
Amounts related to securities litigation and government investigations, net of recoveries		-			14.2
Other non-cash adjustments		4.4			9.2
Excess tax benefit on equity-based compensation		(1.5	)		-
Deferred income taxes		(418.4	)		4.0
Changes in operating assets and liabilities, net of acquisitions		120.6			165.7
Cash provided by continuing operations		310.6			584.3
Cash provided by discontinued operations		10.5			14.1
Cash provided by operations		321.1			598.4
Investing Activities
Investments and acquisitions, net of cash acquired		(24.2	)		(15.7	)
Capital expenditures and product development costs		(43.4	)		(65.9	)
Investment activities from discontinued operations		12.9			(1.7	)
Other investment proceeds		4.8			0.7
Cash used by investing activities		(49.9	)		(82.6	)
Financing Activities
Principal payments on capital leases		(17.0	)		(14.8	)
Net distribution to Time Warner		-			(554.6	)
Excess tax benefit on equity-based compensation		1.5			-
Other		-			(10.3	)
Cash used by financing activities		(15.5	)		(579.7	)
Effect of exchange rate changes on cash and equivalents		(6.9	)		3.9
Increase (decrease) in cash and equivalents		248.8			(60.0	)
Cash and equivalents at beginning of period		147.0			134.7
Cash and equivalents at end of period		395.8			74.7
Less: Cash and equivalents of discontinued operations at end of period		4.2			13.6
Cash and equivalents of continuing operations at end of period	$	391.6		$	61.1
Supplemental disclosures of cash flow information
Cash paid for interest	$	4.4		$	1.5
Cash paid for taxes	$	1.6		$	132.3

See accompanying notes.

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AOL INC.

ITEM 1. FINANCIAL STATEMENTS

CONSOLIDATED STATEMENTS OF EQUITY

Six Months Ended June 30, 2010 and 2009

(Unaudited; In millions)

				Divisional Equity			Additional Paid-In Capital			Accumulated Other Comprehensive Income (Loss)			Retained Earnings (Accumulated Deficit)			Non- Controlling Interest			Total Equity
	Common Stock
	Shares	Amount
Balance at December 31, 2008	-	$	-	$	4,038.6		$	-		$	(302.4	)	$	-		$	1.5		$	3,737.7
Net income	-		-		173.4			-			-			-			(0.2	)		173.2
Unrealized gains on derivatives and investments, net of tax	-		-		-			-			(0.6	)		-			-			(0.6	)
Foreign currency translation adjustments	-		-		-			-			20.4			-			-			20.4
Comprehensive income (loss)	-		-		173.4			-			19.8			-			(0.2	)		193.0
Net transactions with Time Warner	-		-		(645.8	)		-			-			-			-			(645.8	)
Balance at June 30, 2009	-	$	-	$	3,566.2		$	-		$	(282.6	)	$	-		$	1.3		$	3,284.9
Balance at December 31, 2009	105.8	$	1.1	$	-		$	3,355.5		$	(275.1	)	$	(20.4	)	$	1.8		$	3,062.9
Net loss	-		-		-			-			-			(1,020.3	)		-			(1,020.3	)
Foreign currency translation adjustments	-		-		-			-			(20.2	)		-			-			(20.2	)
Comprehensive loss	-		-		-			-			(20.2	)		(1,020.3	)		-			(1,040.5	)
Deconsolidation of non- controlling interest	-		-		-			-			-			-			(1.8	)		(1.8	)
Spin-off deferred tax adjustment (See Note 6)	-		-		-			(25.9	)		-			-			-			(25.9	)
Issuance of common stock in connection with acquisitions	0.7		-		-			18.2			-			-			-			18.2
Amounts related to equity-based compensation, including tax benefits	0.2		-		-			20.4			-			-			-			20.4
Other	-		-		-			1.1			-			-			-			1.1
Balance at June 30, 2010	106.7	$	1.1	$	-		$	3,369.3		$	(295.3	)	$	(1,040.7	)	$	-		$	2,034.4

See accompanying notes.

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AOL INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1—DESCRIPTION OF BUSINESS, BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Description of Business

For a description of the business of AOL Inc. (“AOL” or the “Company”), see “Note 1” to the Company’s audited consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2009 (the “Annual Report”).

The Spin-Off

On December 9, 2009, the Company completed its legal and structural separation from Time Warner Inc. (“Time Warner”) via a spin-off (the “spin-off”). In the spin-off, Time Warner shareholders of record as of 5 p.m. on November 27, 2009, the record date for the distribution, received one share of AOL common stock for every eleven shares of Time Warner common stock held. On December 10, 2009, AOL began trading on the New York Stock Exchange as an independent, public company.

Basis of Presentation

Changes in Basis of Presentation

The interim consolidated financial statements for 2009 have been recast so that the basis of presentation is consistent with that of the interim consolidated financial statements for 2010. This recast reflects the financial condition, results of operations and cash flows of Perfiliate Limited (doing business as buy.at) and the Company’s ICQ operations (“ICQ”) as discontinued operations for all periods presented.

Basis of Consolidation

The consolidated financial statements include 100% of the assets, liabilities, revenues, expenses and cash flows of AOL, all voting interest entities in which AOL has a controlling voting interest (“subsidiaries”), and those variable interest entities for which AOL is the primary beneficiary in accordance with the consolidation accounting guidance. Through the date of the spin-off, these financial statements present the historical consolidated results of operations, financial position, and cash flows of the AOL business that now comprises the operations of the Company. Intercompany accounts and transactions between consolidated companies have been eliminated in consolidation. Prior to the spin-off, AOL was a subsidiary of Time Warner. The financial information prior to the spin-off may not necessarily reflect AOL’s financial position, results of operations and cash flows in the future or what AOL’s financial position, results of operations and cash flows would have been had AOL been an independent, publicly-traded company.

Through the date of the spin-off, the consolidated financial statements include allocations of certain Time Warner corporate expenses. Management believes the assumptions and methodologies underlying the allocation of general corporate overhead expenses are reasonable. However, such expenses may not be indicative of the actual level of expense that would have been incurred by AOL if it had operated as an independent, publicly-traded company or of the costs expected to be incurred in the future. These allocated expenses relate to various services that were provided to AOL by Time Warner, including cash management and other treasury services, administrative services (such as government relations, tax, employee benefit administration, internal audit, accounting and human resources), equity-based compensation plan administration, aviation services, insurance coverage and the licensing of certain third-party patents. See “Note 13” to the Company’s audited consolidated financial statements included in the Annual Report for further information regarding the allocation of Time Warner corporate expenses and the ongoing relationship with Time Warner.

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AOL INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

The financial position and operating results of substantially all foreign operations are consolidated using the local currency as the functional currency. Local currency assets and liabilities are translated at the rates of exchange on the balance sheet date, and local currency revenues and expenses are translated at average rates of exchange during the period. Resulting translation gains or losses are included in the consolidated balance sheet as a component of accumulated other comprehensive income (loss), net.

Use of Estimates

The preparation of the financial statements in conformity with U.S. generally accepted accounting principles (GAAP) requires management to make estimates, judgments and assumptions that affect the amounts reported in the consolidated financial statements and footnotes thereto. Actual results could differ from those estimates. Significant estimates inherent in the preparation of the consolidated financial statements include accounting for asset impairments, reserves established for doubtful accounts, equity-based compensation, depreciation and amortization, business combinations, income taxes, litigation matters and contingencies.

Interim Financial Statements

The interim consolidated financial statements are unaudited; however, in the opinion of management, they contain all the adjustments (consisting of those of a normal recurring nature) considered necessary to present fairly the financial position, the results of operations and cash flows for the periods presented in conformity with GAAP applicable to interim periods. The interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements of AOL in the Annual Report.

Information about Geographical Areas

Revenues in different geographical areas are as follows (in millions):

	Three Months Ended June  30,(a)				Six Months Ended June  30,(a)
	2010		2009		2010		2009
United States	$	538.5	$	697.9	$	1,125.9	$	1,456.9
United Kingdom		23.6		37.6		54.4		78.0
Germany		7.5		14.6		21.2		29.3
France		2.8		18.1		14.3		36.4
Canada		9.7		8.6		18.9		16.6
Other international		2.0		14.7		4.6		29.6
Total international		45.6		93.6		113.4		189.9
Total	$	584.1	$	791.5	$	1,239.3	$	1,646.8

(a) Revenues are attributed to countries based on the location of customers.

Recent Accounting Standards

Variable Interest Entities

In June 2009, new guidance was issued which requires an enterprise to perform an analysis to determine whether the enterprise’s variable interest or interests give it a controlling financial interest in a variable interest

30

AOL INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

entity. This analysis identifies the primary beneficiary of a variable interest entity as the enterprise that has (i) the power to direct the activities of a variable interest entity that most significantly impact the entity’s economic performance and (ii) the obligation to absorb losses of the entity that could potentially be significant to the variable interest entity or the right to receive benefits from the entity that could potentially be significant to the variable interest entity. In addition, this guidance amends the accounting for variable interest entities to (i) require ongoing assessments of whether an entity is the primary beneficiary of a variable interest entity, (ii) eliminate the quantitative approach for determining the primary beneficiary of a variable interest entity, (iii) amend certain guidance for determining whether an entity is a variable interest entity and (iv) require enhanced disclosures. This guidance became effective for AOL on January 1, 2010 and as a result of applying this guidance, the Company deconsolidated an international joint venture on January 1, 2010. This deconsolidation did not have a material impact on the Company’s consolidated financial statements.

Amendments to Revenue Arrangements with Multiple Deliverables

In October 2009, new guidance was issued related to the accounting for multiple-deliverable revenue arrangements. This new guidance amends the existing guidance for separating consideration in multiple deliverable arrangements and establishes a selling price hierarchy for determining the selling price of a deliverable. This new guidance will become effective for AOL on January 1, 2011 with earlier application permitted, provided that the revised guidance is retroactively applied to the beginning of the year of adoption. The Company is currently evaluating the impact that the adoption of this new guidance will have on the Company’s revenue recognition policies and results of operations.

NOTE 2—INCOME PER COMMON SHARE

Basic income per common share is calculated by dividing net income attributable to AOL common stockholders by the weighted average number of shares of common stock issued and outstanding during the reporting period. Diluted income per common share is calculated to give effect to all potentially dilutive common shares that were outstanding during the reporting period. The dilutive effect of outstanding equity-based compensation awards is reflected in diluted income per common share by application of the treasury stock method, only in periods in which such effect would have been dilutive on income from continuing operations. For the three and six months ended June 30, 2010, the Company had 5.6 million and 5.1 million, respectively, of weighted-average potentially dilutive common shares that were not included in the computation of diluted earnings per share because to do so would be anti-dilutive for those periods.

On November 2, 2009, the Company converted from AOL Holdings LLC, a limited liability company wholly owned by Time Warner, to AOL Inc., a corporation wholly owned by Time Warner. On the distribution date of December 9, 2009, 105.8 million shares of $0.01 par value AOL common stock were distributed to Time Warner shareholders of record as of 5 p.m. on November 27, 2009. This share amount is being utilized for the calculation of basic and diluted income per common share for the three and six months ended June 30, 2009 as no common stock of the Company existed prior to November 2, 2009 and no dilutive securities of the Company were outstanding during the three and six months ended June 30, 2009.

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AOL INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

The following table is a reconciliation of basic and diluted income per common share from continuing operations (in millions, except per share amounts):

	Three Months Ended June 30,					Six Months Ended June 30,
	2010			2009		2010			2009
Net income (loss) attributable to AOL Inc. common stockholders	$	(1,055.0	)	$	90.7	$	(1,020.3	)	$	173.4
Shares used in computing basic and diluted income per common share		106.7			105.8		106.5			105.8
Basic and diluted net income (loss) per common share	$	(9.89	)	$	0.86	$	(9.58	)	$	1.64

NOTE 3—GOODWILL

A summary of changes in the Company’s goodwill during the six months ended June 30, 2010 is as follows (in millions):

	Gross Goodwill			Impairments			Net Goodwill
December 31, 2009	$	36,329.8		$	(34,210.7	)	$	2,119.1
Acquisitions, dispositions and adjustments		22.0			-			22.0
Impairments		-			(1,414.4	)		(1,414.4	)
Translation and other adjustments		(23.8	)		-			(23.8	)
June 30, 2010	$	36,328.0		$	(35,625.1	)	$	702.9

Interim Impairment Testing of Goodwill

As discussed in more detail in “Note 1” to the Company’s audited consolidated financial statements included in the Annual Report, goodwill is tested annually for impairment during the fourth quarter or earlier upon the occurrence of certain events or substantive changes in circumstances that indicate goodwill is more likely than not impaired. In connection with the annual goodwill impairment analysis performed during the fourth quarter of 2009, the Company determined that the fair value of its sole reporting unit exceeded its book value, and therefore no goodwill impairment charge was recorded in 2009. During the first quarter of 2010, the Company concluded that no events or changes in circumstances had occurred that indicated goodwill was more likely than not impaired.

During the three months ended June 30, 2010, the Company entered into an agreement to sell its ICQ operations and the Company completed the sale of substantially all of its assets of Bebo. In addition, subsequent to the Company’s announcement on April 28, 2010 of its financial results for the three months ended March 31, 2010, the Company experienced a significant decline in its stock price, and the Company’s stock price continued to trend lower. As of June 30, 2010, the Company’s stock price had declined 26% from its closing stock price on April 27, 2010. The Company determined that these events occurring in the second quarter of 2010 constituted substantive changes in circumstances that would more likely than not reduce the fair value of the Company’s single reporting unit below its carrying amount. Accordingly, the Company tested its goodwill for impairment as of June 30, 2010 (the “interim testing date”).

In determining the fair value of the Company’s sole reporting unit for the interim impairment analysis, the Company used a market-based approach as the primary input in this approach was a quoted market price in an active market. To determine the estimated fair value of the Company’s sole reporting unit, the Company calculated its market capitalization

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AOL INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

based on its stock price and adjusted it by a control premium of 25%. The premium used to arrive at a controlling interest equity value was determined based on values observed in recent market transactions. Based on the Company’s interim impairment analysis as of June 30, 2010, the carrying value of the Company’s single reporting unit exceeded its fair value. Accordingly, step two of the goodwill impairment test was performed. In performing step two of the goodwill impairment test, the Company utilized significant unobservable inputs, including the control premium and the valuation of the Company’s unrecognized intangible assets, which overall causes the determination of the implied fair value of goodwill to fall within level three of the GAAP fair value hierarchy. As a result of the step two evaluation, the Company recorded a goodwill impairment charge of $1,414.4 million for the three months ended June 30, 2010.

NOTE 4—BUSINESS ACQUISITIONS, DISPOSITIONS AND OTHER SIGNIFICANT TRANSACTIONS

Acquisition of StudioNow, Inc.

On January 22, 2010, the Company completed the acquisition of StudioNow, Inc. (“StudioNow”), a provider of a proprietary digital platform that allows clients to create, produce, manage and distribute professional quality videos at scale, for a purchase price of $32.1 million (excluding $3.1 million due two years after the closing date and contingent on the future service of certain StudioNow employees). $14.1 million of the total consideration was paid through the issuance of 594,749 shares of AOL common stock valued as of the closing date. Of the remaining $18.0 million, $14.0 million was paid in cash at the closing date and $4.0 million reflects the present value of the cash consideration due two years after the closing date. The $3.1 million payment contingent on the future service of certain StudioNow employees is not included in the purchase price allocation and is being recognized as compensation expense on a straight-line basis over the two-year requisite service period.

This business was acquired to attract and engage more Internet users and drive high volumes of video content production through StudioNow’s platform, which, along with market conditions at the time of acquisition, contributed to a purchase price that resulted in the allocation of a significant portion of the purchase price to goodwill. AOL recognized $26.7 million of goodwill (which is not deductible for tax purposes) and $4.3 million of intangible assets related to this acquisition. The results of operations of StudioNow from the acquisition date through June 30, 2010 were not material to the Company’s consolidated financial statements.

Sale of buy.at

On February 26, 2010, the Company sold buy.at to Digital Window Limited for $16.4 million in net cash. The Company recorded a pre-tax loss on this sale of $18.7 million, calculated as the excess of the carrying value of the net assets sold (including goodwill allocated to the sale of $12.6 million) over the cash proceeds, net of transaction costs. Due primarily to the Company’s conclusions around the likelihood of utilizing a portion of the capital loss deferred tax asset generated by the sale of buy.at, the Company recorded an income tax benefit on the sale of buy.at of $15.0 million and $26.7 million for three and six months ended June 30, 2010, respectively. The financial condition, results of operations and cash flows of buy.at have been reflected as discontinued operations for all periods presented. The results of operations of buy.at were not material to the Company’s consolidated financial statements.

As discussed above, the sale of buy.at generated a capital loss deferred tax asset in the United States of $65.9 million; however, significant uncertainty existed regarding the future realization of the majority of this deferred tax asset. As of March 31, 2010, the Company recorded a valuation allowance of $61.1 million associated with this deferred tax asset. As a result of the Company’s disposition activity in the second quarter of 2010, management determined that an additional $15.0 million of this deferred tax asset is more likely than not to be realized. Accordingly, the results of discontinued operations for the three months ended June 30, 2010 included an income tax benefit of $15.0 million related to the reversal of a portion of the valuation allowance

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AOL INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

against this asset. As of June 30, 2010, the valuation allowance associated with this deferred tax asset was $46.1 million. If in the future the Company believes that it is more likely than not that all or an additional portion of this deferred tax asset will be realized, a further reduction in the valuation allowance will be recognized in the statement of operations.

Sale of ICQ Operations

On July 8, 2010, the Company completed the sale of its ICQ operations (“ICQ”) for $187.5 million in cash (subject to working capital adjustments). The Company expects to record a pre-tax gain on this sale of approximately $120 to $130 million within discontinued operations, a portion of which may be deferred for up to twelve months following the sale related to the Company’s obligation to provide certain transition services. ICQ provides online instant messaging services and products, as well as software related to such services and products, primarily to international online consumers. The financial condition, results of operations and cash flows of ICQ have been reflected as discontinued operations for all periods presented. The results of operations of ICQ were not material to the Company’s consolidated financial statements.

Summary of Discontinued Operations

Discontinued operations for the three and six months ended June 30, 2010 and 2009 reflect the financial condition, results of operations and cash flows of buy.at and ICQ. The six months ended June 30, 2010 included the results of operations of buy.at for the period from January 1, 2010 through the sale date of February 26, 2010, the loss on the sale of buy.at and the income tax benefit associated with the capital loss deferred tax asset generated by the buy.at sale. Both the three and six months ended June 30, 2010 included the results of operations of ICQ as it was not sold until July 8, 2010. Financial data for discontinued operations for the three and six months ended June 30, 2010 and 2009 is as follows (in millions):

	Three Months Ended June 30,						Six Months Ended June 30,
	2010			2009			2010			2009
Total revenues	$	8.1		$	12.2		$	19.2		$	24.1
Pre-tax income (before loss on sale of business)		4.6			4.9			8.8			9.5
Loss on sale of business		(1.0	)		-			(18.7	)		-
Income tax (provision) benefit		12.9			(2.5	)		23.3			(5.0	)
Net income attributable to AOL Inc.		16.5			2.4			13.4			4.5

Long-term assets of discontinued operations include goodwill of approximately $52.5 million and $65.1 million as of June 30, 2010 and December 31, 2009, respectively, allocated based on the estimated fair values of the discontinued operations relative to the estimated fair value of AOL’s sole reporting unit.

Sale of Bebo, Inc.

On June 16, 2010, the Company sold substantially all the assets of Bebo, Inc. (“Bebo”), resulting in a pre-tax loss of approximately $2.2 million. The Company expects to treat the common stock of Bebo as worthless for U.S. income tax reporting purposes in its 2010 consolidated U.S. federal income tax return. The Company’s current estimated U.S. income tax basis in Bebo is $767.1 million. As a result of the anticipated worthless stock deduction for the common stock of Bebo under U.S. income tax law, and in order to recognize the book and tax basis differences associated with its investment in Bebo, the Company recorded a deferred tax asset and corresponding income tax benefit of $302.7 million in the second quarter of 2010. Following this transaction, the Company expects to continue to generate advertising revenues on AOL Properties from customers who previously purchased advertising on Bebo properties and accordingly, under the accounting

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AOL INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

guidance for presentation of financial statements, the financial condition, results of operations and cash flows of Bebo have not been reflected as discontinued operations.

Sale of Investment in Kayak Software Corporation

On July 30, 2010, the Company entered into an agreement to sell its cost method investment in Kayak Software Corporation for $18.9 million in net cash proceeds. The Company expects to complete this sale in the third quarter of 2010 and expects to record a pre-tax gain of $17.5 million on this sale.

NOTE 5—INCOME TAXES

The Company recorded a loss from continuing operations before income taxes of $1,340.8 million and $1,267.7 million for the three and six months ended June 30, 2010, respectively. Included in this loss was a goodwill impairment charge of $1,414.4 million, the majority of which is not deductible for income tax purposes. In addition, the Company recorded an income tax benefit for the three and six months ended June 30, 2010 of $269.3 million and $234.0 million, respectively, of which $302.7 million is related to a deferred tax asset associated with the anticipated Bebo worthless stock deduction. This deferred tax asset is expected to be used to offset future ordinary income and capital gains of the Company, which is expected to ultimately result in cash tax savings by offsetting future U.S. federal and state income tax obligations through the anticipated worthless stock deduction. As a result of these items, the effective tax rates for the three and six months ended June 30, 2010 are significantly lower than the statutory U.S. federal income tax rate of 35.0%.

The Company’s effective tax rates for income from continuing operations, including the effect of the deferred tax asset related to the anticipated worthless stock deduction and the goodwill impairment charge, were 20.1% and 18.5% for the three and six months ended June 30, 2010, as compared to 44.5% and 42.4% for the three and six months ended June 30, 2009, respectively. The effective tax rates differed from the statutory U.S. federal income tax rate of 35.0% and the effective tax rate for the three and six months ended June 30, 2009 primarily due to the effect of the anticipated worthless stock deduction and an increase in the U.S. benefit of foreign branch losses, partially offset by the effect of the goodwill impairment charge (the majority of which was non-deductible for income tax purposes).

For the three and six months ended June 30, 2010, the Company recorded an income tax benefit on discontinued operations of $12.9 million and $23.3 million, respectively. Of these amounts, $15.0 million and $19.8 million for the three and six months ended June 30, 2010, respectively, related to the reversal of a valuation allowance on the capital loss deferred tax asset recorded in connection with the sale of buy.at. The Company reversed this portion of the valuation allowance because it believes it is more likely than not it will utilize a portion of the capital loss to offset future capital gains. See “Note 4” for additional information on the sale of buy.at and related capital loss deferred tax assets.

NOTE 6—STOCKHOLDERS’ EQUITY

As of June 30, 2010, 106.7 million shares of common stock were issued and outstanding. No dividends were declared or paid for the three and six months ended June 30, 2010.

On January 22, 2010, the Company issued 594,749 shares of AOL common stock as consideration for the acquisition of StudioNow, Inc. On January 29, 2010, the Company issued 173,078 shares of AOL common stock to Polar Capital Group, LLC, in partial satisfaction of its contractual obligation to return the CEO’s initial investment of approximately $4.5 million in Patch Media Corporation (“Patch”), which arose from its acquisition of Patch on June 10, 2009. On July 16, 2010, the Company issued 21,779 shares of AOL common stock to Polar

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AOL INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

Capital Group, LLC, in final satisfaction of the Company’s contractual obligation to return the CEO’s initial investment in Patch.

Under the terms of the Company’s tax matters agreement with Time Warner, amounts payable or receivable to Time Warner prior to the spin-off were reflected as adjustments to divisional equity. In the first quarter of 2010, the Company adjusted its deferred tax assets and its estimated amount payable to Time Warner for taxes prior to the spin-off and this adjustment resulted in a $25.9 million reduction to additional paid-in capital.

NOTE 7—EQUITY-BASED COMPENSATION

Pursuant to the Company’s 2010 Stock Incentive Plan, or “2010 SIP”, stock options are granted to employees, advisors and non-employee directors of AOL with exercise prices equal to the quoted market value of the common stock at the date of grant. Generally, the stock options vest ratably over a four year vesting period and expire ten years from the date of grant. Certain stock option awards provide for accelerated vesting upon an election to retire after reaching a specified age and years of service, as well as certain additional circumstances for non-employee directors.

Also pursuant to the 2010 SIP, AOL may also grant shares of common stock or restricted stock units (RSUs) to its employees, advisors and non-employee directors, which generally vest ratably over a four year period from the date of grant. Holders of restricted stock and RSU awards are generally entitled to receive regular cash dividends or dividend equivalents, respectively, if paid by the Company during the period of time that the restricted stock or RSU awards are unvested.

The Company is authorized to grant equity awards to employees covering an aggregate of 16.6 million shares of AOL common stock under the 2010 SIP, of which up to 7.8 million awards may be issued in the form of full-value awards, such as restricted stock or RSUs. Amounts available for issuance pursuant to grants under the 2010 SIP will change over time based on such activities as the conversion of equity awards into common stock, the forfeiture of equity awards and the cancellation of equity awards, among other activities.

Upon the (i) exercise of a stock option award, (ii) vesting of a RSU or (iii) grant of restricted stock, shares of AOL common stock are issued from authorized but unissued shares or from treasury stock. At both June 30, 2010 and December 31, 2009, the Company did not have any shares of treasury stock.

Equity-Based Compensation Expense

Compensation expense recognized by AOL related to its equity-based compensation plan and for its participation in Time Warner’s equity-based compensation plans, prior to the spin-off, is as follows (in millions):

	Three Months Ended June 30,					Six Months Ended June 30,
	2010		2009			2010		2009
Stock options	$	4.4	$	(0.3	)	$	8.5	$	2.5
RSUs and performance stock units (PSUs)(a)		4.7		2.0			10.3		5.3
Total equity-based compensation expense	$	9.1	$	1.7		$	18.8	$	7.8
Tax benefit recognized	$	3.6	$	0.9		$	7.5	$	3.4

(a) AOL has only granted RSUs to employees. Prior to the spin-off, Time Warner granted RSUs and PSUs to AOL employees.

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AOL INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

As of June 30, 2010, total unrecognized compensation cost related to unvested AOL stock option awards, without taking into account expected forfeitures, was $43.7 million and is expected to be recognized over a weighted-average period of approximately 3.0 years. Total unrecognized compensation cost as of June 30, 2010 related to unvested RSUs, without taking into account expected forfeitures, was $73.7 million and is expected to be recognized over a weighted-average period of approximately 3.4 years.

Stock Options

The assumptions presented in the table below represent the weighted-average value of the applicable assumption used to value AOL stock options at their grant date:

	Six Months Ended June 30, 2010
Expected volatility	37.7%
Expected term to exercise from grant date	5.38 years
Risk-free rate	2.6%
Expected dividend yield	0%

NOTE 8—RESTRUCTURING COSTS

In connection with the Company’s restructuring initiatives, the Company incurred $11.1 million and $34.5 million in restructuring costs for the three and six months ended June 30, 2010, respectively, and incurred $14.4 million and $72.7 million in restructuring costs for the three and six months ended June 30, 2009, respectively, to better align its organizational structure and costs with its strategy. These costs related to voluntary and involuntary employee terminations, facility closures and contract termination costs. Employee termination costs were attributable to terminations of employees ranging from senior executives to line personnel. The Company expects to incur additional restructuring costs of up to $15.0 million during the remainder of 2010 in connection with these initiatives.

A summary of AOL’s restructuring activity for the three and six months ended June 30, 2010 is as follows (in millions):

	Employee Terminations			Other Exit Costs			Total
Liability at December 31, 2009	$	108.1		$	28.3		$	136.4
Net accruals		20.6			13.9			34.5
Foreign currency translation and other adjustments		(8.0	)		(0.1	)		(8.1	)
Cash paid		(77.5	)		(12.2	)		(89.7	)
Liability at June 30, 2010	$	43.2		$	29.9		$	73.1

At June 30, 2010, of the remaining liability of $73.1 million, $62.5 million was classified as a current liability within accrued expenses and other current liabilities, with the remaining $10.6 million classified as a long-term liability in the consolidated balance sheet. Amounts classified as long-term are expected to be paid through 2014.

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AOL INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

NOTE 9—COMMITMENTS AND CONTINGENCIES

Commitments

For a description of AOL’s commitments see “Note 11” to the Company’s audited consolidated financial statements included in the Annual Report.

Contingencies

On May 24, 1999, two former AOL Community Leader volunteers brought a putative class action, Hallissey et al. v. America Online, Inc., in the U.S. District Court for the Southern District of New York alleging violations of the Fair Labor Standards Act (“FLSA”) and New York State law. The plaintiffs alleged that, in serving as AOL Community Leader volunteers, they were acting as employees rather than volunteers for purposes of the FLSA and New York State law and are entitled to minimum wages. In 2001, four of the named plaintiffs in the Hallissey case filed a related lawsuit alleging retaliation as a result of filing the FLSA suit in Williams, et al. v. America Online, Inc., et al. A related case was filed by several of the Hallissey plaintiffs in the U.S. District Court for the Southern District of New York alleging violations of the retaliation provisions of the FLSA. Also in 2001, two related class actions were filed in state courts in New Jersey (Superior Court of New Jersey, Bergen County Law Division) and Ohio (Court of Common Pleas, Montgomery County, Ohio), alleging violations of the FLSA and/or the respective state laws. These cases were removed to federal court and subsequently transferred to the U.S. District Court for the Southern District of New York for consolidated pretrial proceedings with Hallissey.

On January 17, 2002, AOL Community Leader volunteers filed a class action lawsuit in the U.S. District Court for the Southern District of New York, Hallissey et al. v. AOL Time Warner, Inc., et al., against AOL LLC alleging ERISA violations and an entitlement to pension, welfare and/or other employee benefits subject to ERISA. In March 2003, plaintiffs filed and served a second amended complaint, adding as defendants the AOL Time Warner Administrative Committee and the AOL Administrative Committee.

The parties to all of the Community Leader-related lawsuits have agreed to settle the lawsuits on terms that did not result in a material incremental expense or material payment by the Company in 2009. The court granted final approval of the settlement on May 20, 2010. The Company does not expect to make any additional payments related to this matter.

On September 22, 2006, Salvadore Ramkissoon and two unnamed plaintiffs filed a putative class action against AOL LLC in the U.S. District Court for the Northern District of California based on AOL LLC’s public posting of AOL LLC member search queries in late July 2006. Among other things, the complaint alleges violations of the Electronic Communications Privacy Act and California statutes relating to privacy, data protection and false advertising. The complaint seeks class certification and damages, as well as injunctive relief that would oblige AOL LLC to alter its search query retention practices.

In February 2007, the District Court dismissed the action without prejudice. The plaintiffs then appealed this decision to the Ninth Circuit. On January 16, 2009, the Ninth Circuit held that AOL LLC’s Terms of Service violated California public policy as to any California plaintiffs in the putative class, as it did not allow for them to fully exercise their rights. The Ninth Circuit reversed and remanded to the District Court for further proceedings. On April 24, 2009, AOL LLC filed a motion to implement the Ninth Circuit’s mandate. On July 6, 2009, the District Court found that the plaintiffs’ claims for unjust enrichment and public disclosure of private facts were subject to the forum selection clause in the Terms of Service and thus could not be pursued in that court. On October 27, 2009, plaintiffs filed a motion for class certification and two additional named individuals filed a motion to intervene as plaintiffs in the matter. Also on October 27, 2009, AOL LLC filed its reply brief

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AOL INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

with regard to its 12(c) Motion for Judgment on the Pleadings. On February 2, 2010, the Court issued an Order granting AOL’s motion to implement the mandate of the Ninth Circuit. In its Order, the court dismissed named plaintiff Ramkissoon, as he is not a California resident. In addition, the court dismissed the remaining claim under the Electronic Communications Privacy Act, as well as the claims for unjust enrichment and public disclosure of private facts. The Court also dismissed without prejudice both the plaintiffs’ motion for class certification as well as AOL’s 12(c) motion.

Subsequent to the court’s order, AOL filed a modified 12(c) motion on February 24, 2010. On March 2, 2010, plaintiffs’ counsel withdrew a motion seeking to have two additional class representatives intervene in this action. On March 17, 2010, the plaintiffs filed a Writ of Mandamus with the Ninth Circuit challenging the District Court’s recent ruling. On April 13, 2010, the plaintiffs filed a motion seeking a stay of all proceedings until November 2010. On June 17, 2010, the Ninth Circuit denied the plaintiffs’ Writ of Mandamus, holding that plaintiffs had failed to demonstrate why they cannot seek a final judgment in this matter and then pursue an appeal of the relevant matters thereafter. The District Court then cancelled the hearing on all pending motions, which had been rescheduled for June 22, 2010. On June 23, 2010, the District Court ruled on AOL’s motion to dismiss plaintiffs’ claims, as well as plaintiffs’ motion to stay discovery. The Court dismissed one of the claims (California Consumer Records Act) and denied plaintiffs the ability to refile, and dismissed a second claim (California Consumers Legal Remedies Act) without prejudice. The Court also denied AOL’s motion to dismiss the claims under the California False Advertising Law and the California Unfair Competition Law. The Court also denied plaintiffs’ motion to stay discovery. The Company intends to defend against this lawsuit vigorously.

In addition to the matters listed above, AOL is a party to a variety of legal proceedings that arise in the normal course of business. While the results of such normal course legal proceedings cannot be predicted with certainty, management believes that, based on current knowledge, the final outcome of the current pending matters will not have a material adverse effect on the Company’s financial position, results of operations or cash flows. Regardless of the outcome, legal proceedings can have an adverse effect on the Company because of defense costs, diversion of management resources and other factors.

NOTE 10—SEGMENT INFORMATION

An operating segment is defined as a component of an enterprise that engages in business activities from which it may earn revenues and incur expenses and that has discrete financial information that is regularly reviewed by the chief operating decision-maker in deciding how to allocate resources and in assessing performance.

The Company’s chief operating decision maker, its chief executive officer, evaluates performance and makes operating decisions about allocating resources based on financial data presented on a consolidated basis. There are no managers who are held accountable by AOL’s chief operating decision maker, or anyone else, for an operating measure of profit or loss for any operating unit below the consolidated unit level. Accordingly, management has determined that the Company has one segment.

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AOL INC.

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

On May 24, 1999, two former AOL Community Leader volunteers brought a putative class action, Hallissey et al. v. America Online, Inc., in the U.S. District Court for the Southern District of New York alleging violations of the Fair Labor Standards Act (“FLSA”) and New York State law. The plaintiffs alleged that, in serving as AOL Community Leader volunteers, they were acting as employees rather than volunteers for purposes of the FLSA and New York State law and are entitled to minimum wages. In 2001, four of the named plaintiffs in the Hallissey case filed a related lawsuit alleging retaliation as a result of filing the FLSA suit in Williams, et al. v. America Online, Inc., et al. A related case was filed by several of the Hallissey plaintiffs in the U.S. District Court for the Southern District of New York alleging violations of the retaliation provisions of the FLSA. Also in 2001, two related class actions were filed in state courts in New Jersey (Superior Court of New Jersey, Bergen County Law Division) and Ohio (Court of Common Pleas, Montgomery County, Ohio), alleging violations of the FLSA and/or the respective state laws. These cases were removed to federal court and subsequently transferred to the U.S. District Court for the Southern District of New York for consolidated pretrial proceedings with Hallissey.

On January 17, 2002, AOL Community Leader volunteers filed a class action lawsuit in the U.S. District Court for the Southern District of New York, Hallissey et al. v. AOL Time Warner, Inc., et al., against AOL LLC alleging ERISA violations and an entitlement to pension, welfare and/or other employee benefits subject to ERISA. In March 2003, plaintiffs filed and served a second amended complaint, adding as defendants the AOL Time Warner Administrative Committee and the AOL Administrative Committee.

The parties to all of the Community Leader-related lawsuits have agreed to settle the lawsuits on terms that are not material to the Company. The court granted final approval of the settlement on May 20, 2010.

On September 22, 2006, Salvadore Ramkissoon and two unnamed plaintiffs filed a putative class action against AOL LLC in the U.S. District Court for the Northern District of California based on AOL LLC’s public posting of AOL LLC member search queries in late July 2006. Among other things, the complaint alleges violations of the Electronic Communications Privacy Act and California statutes relating to privacy, data protection and false advertising. The complaint seeks class certification and damages, as well as injunctive relief that would oblige AOL LLC to alter its search query retention practices.

In February 2007, the District Court dismissed the action without prejudice. The plaintiffs then appealed this decision to the Ninth Circuit. On January 16, 2009, the Ninth Circuit held that AOL LLC’s Terms of Service violated California public policy as to any California plaintiffs in the putative class, as it did not allow for them to fully exercise their rights. The Ninth Circuit reversed and remanded to the District Court for further proceedings. On April 24, 2009, AOL LLC filed a motion to implement the Ninth Circuit’s mandate. On July 6, 2009, the District Court found that the plaintiffs’ claims for unjust enrichment and public disclosure of private facts were subject to the forum selection clause in the Terms of Service and thus could not be pursued in that court. On October 27, 2009, plaintiffs filed a motion for class certification and two additional named individuals filed a motion to intervene as plaintiffs in the matter. Also on October 27, 2009, AOL LLC filed its reply brief with regard to its 12(c) Motion for Judgment on the Pleadings. On February 2, 2010, the Court issued an Order granting AOL’s motion to implement the mandate of the Ninth Circuit. In its Order, the court dismissed named plaintiff Ramkissoon, as he is not a California resident. In addition, the court dismissed the remaining claim under the Electronic Communications Privacy Act, as well as the claims for unjust enrichment and public disclosure of private facts. The Court also dismissed without prejudice both the plaintiffs’ motion for class certification as well as AOL’s 12(c) motion.

Subsequent to the court’s order, AOL filed a modified 12(c) motion on February 24, 2010. On March 2, 2010, plaintiffs’ counsel withdrew a motion seeking to have two additional class representatives intervene in this

40

AOL INC.

PART II. OTHER INFORMATION

action. On March 17, 2010, the plaintiffs filed a Writ of Mandamus with the Ninth Circuit challenging the District Court’s recent ruling. On April 13, 2010, the plaintiffs filed a motion seeking a stay of all proceedings until November 2010. On June 17, 2010, the Ninth Circuit denied the plaintiffs’ Writ of Mandamus, holding that plaintiffs had failed to demonstrate why they cannot seek a final judgment in this matter and then pursue an appeal of the relevant matters thereafter. The District Court then cancelled the hearing on all pending motions, which had been rescheduled for June 22, 2010. On June 23, 2010, the District Court ruled on AOL’s motion to dismiss plaintiffs’ claims, as well as plaintiffs’ motion to stay discovery. The Court dismissed one of the claims (California Consumer Records Act) and denied plaintiffs the ability to refile, and dismissed a second claim (California Consumers Legal Remedies Act) without prejudice. The Court also denied AOL’s motion to dismiss the claims under the California False Advertising Law and the California Unfair Competition Law. The Court also denied plaintiffs’ motion to stay discovery. The Company intends to defend against this lawsuit vigorously.

In addition to the matters listed above, we are a party to a variety of legal proceedings that arise in the normal course of our business. While the results of such normal course legal proceedings cannot be predicted with certainty, management believes that, based on current knowledge, the final outcome of the current pending matters will not have a material adverse effect on our financial position, results of operations or cash flows. Regardless of the outcome, legal proceedings can have an adverse effect on the Company because of defense costs, diversion of management resources and other factors. See “Item 1A—Risk Factors—Risks Relating to Our Business—If we cannot continue to enforce and protect our intellectual property rights, our business could be adversely affected” and “Item 1A—Risk Factors—Risks Relating to Our Business—We have been, and may in the future be, subject to claims of intellectual property infringement that could adversely affect our business” included in our Annual Report.

ITEM 1A. RISK FACTORS

There have been no material changes in the Company’s risk factors from those disclosed in Part I, Item 1A of our Annual Report.

ITEM 6. EXHIBITS

The agreements and other documents filed as exhibits to this report are not intended to provide factual information or other disclosure, other than with respect to the terms of the agreements or other documents themselves, and you should not rely on them for that purpose. In particular, any representations and warranties made by us in these agreements or other documents were made solely within the specific context of the relevant agreement or document and may not describe the actual state of affairs as of the date they were made or at any other time.

See the Exhibit Index immediately following the signature page of this Quarterly Report.

41

AOL INC.

SIGNATURES

Pursuant to the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, on August 4, 2010.

AOL INC.
By	/s/    ARTHUR MINSON
Name:	Arthur Minson
Title:	Executive Vice President and Chief Financial Officer

42

AOL INC.

EXHIBIT INDEX

Exhibit Number	Description
2.1	Securities Purchase Agreement between AOL Inc. and Digital Sky Technologies Limited, (the “SPA”) dated April 28, 2010.*
10.1	Twenty-Seventh Amendment to Amended and Restated Interactive Marketing Agreement between AOL Inc. and Google Inc. (“IMA”), dated April 29, 2010 and effective May 1, 2010.**
10.2	Twenty-Eighth Amendment to IMA, dated June 1, 2010.**
10.3	Search Services Agreement between AOL LLC and CNN Interactive Group, Inc. (“CNN SSA”), dated as of September 1, 2007.
10.4	First Amendment to CNN SSA, effective as of April 30, 2008.
10.5	Second Amendment to CNN SSA, effective as of December 10, 2009.
10.6	Sixth Amendment to CNN SSA, dated April 30, 2010.
10.7	Seventh Amendment to CNN SSA, dated May 25, 2010 and effective May 31, 2010.
10.8	Sixth Amendment to Search Services Agreement between AOL Inc. and Time Inc. (“Time SSA”), dated April 23, 2010 and effective April 30, 2010.
10.9	Seventh Amendment to Time SSA, dated May 26, 2010 and effective May 31, 2010.
10.10	Amended and Restated AOL Inc. 2010 Stock Incentive Plan (incorporated herein by reference to Annex A of the Company’s Definitive Proxy Statement filed with the Securities and Exchange Commission on March 16, 2010 (File No. 001-34419)).
10.11	Amended and Restated Annual Incentive Plan for Executive Officers (incorporated herein by reference to Annex B of the Company’s Definitive Proxy Statement filed with the Securities and Exchange Commission on March 16, 2010 (File No. 001-34419)).
10.12	Separation Agreement and Release of Claims between AOL Inc. and Ted Cahall, dated April 8, 2010 and effective May 1, 2010.
10.13	Form of AOL Inc. Annual Bonus Plan.
10.14	Letter Agreement between AOL Inc., Polar Capital Group, LLC and Polar News Company, LLC, dated January 29, 2010.
10.15	Separation Agreement and Release of Claims between AOL Inc. and Ira Parker, dated June 10, 2010 and effective July 15, 2010.
31.1	Certification of Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, with respect to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2010.
31.2	Certification of Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, with respect to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2010.
32.1	Certification of Principal Executive Officer and Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, with respect to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2010.†

† This certification will not be deemed “filed” for purposes of Section 18 of the Exchange Act (15 U.S.C. 78r), or otherwise subject to the liability of that section. Such certification will not be deemed to be incorporated by reference into any filing under the Securities Act or Exchange Act, except to the extent that the Registrant specifically incorporates it by reference.

* The exhibits to the SPA have been omitted in accordance with Item 601 (b) (2) of Regulation S-K and will be provided to the SEC upon request.

** An application for confidential treatment for selected portions of this agreement has been filed with the Securities and Exchange Commission.

43

EX-2.1

Exhibit 2.1

EXECUTION COPY

SECURITIES PURCHASE AGREEMENT

between

AOL INC.

and

DIGITAL SKY TECHNOLOGIES LIMITED

Dated as of April 28, 2010

TABLE OF CONTENTS

		Page
ARTICLE I DEFINITIONS AND RULES OF CONSTRUCTION		1
1.1	Definitions	1
1.2	Rules of Construction	9
ARTICLE II PURCHASE AND SALE		10
2.1	Purchase and Sale of Securities	10
2.2	Purchase Price	10
2.3	Purchase Price Adjustments	10
2.4	Closing	11
2.5	Closing Deliveries by Seller	12
2.6	Closing Deliveries by Purchaser	12
2.7	Allocation of Purchase Price	12
2.8	Withholding	13
ARTICLE III REPRESENTATIONS AND WARRANTIES OF SELLER		14
3.1	Valid Existence	14
3.2	Proper Authority	14
3.3	Governmental Approvals and Consents	14
3.4	Capitalization; Ownership of Securities; Company Subsidiary	15
3.5	Real Property	15
3.6	Material Contracts	16
3.7	Litigation	18
3.8	Intellectual Property Rights and Software	18
3.9	IT Systems	20
3.10	Finders; Brokers	20
3.11	Tax Matters	20
3.12	Employment and Benefits	20
3.13	Labor Matters	22
3.14	Compliance with Laws	22
3.15	Environmental Matters	22
3.16	Financial Statements	22
3.17	Absence of Changes	23
3.18	Assets	24
3.19	Insurance	25
3.20	Related Party Transactions	25
3.21	Bank Accounts	25
3.22	Grants	25
3.23	Privacy	25
3.24	No Other Representations or Warranties	26
ARTICLE IV REPRESENTATIONS OF PURCHASER		26
4.1	Corporate Existence	26
4.2	Corporate Authority	26

-i-

TABLE OF CONTENTS

(Continued)

		Page
4.3	Governmental Approvals and Consents	27
4.4	Finders; Brokers	27
4.5	Financial Capacity	27
4.6	Solvency	27
4.7	Litigation	27
4.8	Accredited Investor	28
4.9	Investment Purpose	28
4.10	No Other Representations or Warranties	28
ARTICLE V AGREEMENTS OF PURCHASER AND SELLER		28
5.1	Operation of the Business	28
5.2	Investigation of Business; Confidentiality.	30
5.3	Necessary Efforts; No Inconsistent Action.	31
5.4	Public Disclosures	33
5.5	Access to Records and Personnel	33
5.6	Employee Benefits	34
5.7	Post-Closing Arrangements	35
5.8	Non-Solicitation; No-Hire.	35
5.9	No-Shop.	36
5.10	No Intellectual Property Rights; Trademark Licenses; Source Code	37
5.11	Insurance Matters	39
5.12	Tax Matters.	40
5.13	Mail Handling; Post-Closing Payments	42
5.14	Resignations	42
5.15	Consents	42
5.16	Director and Officer Indemnification	42
ARTICLE VI CONDITIONS TO CLOSING		43
6.1	Conditions Precedent to Obligations of Purchaser and Seller	43
6.2	Conditions Precedent to Obligation of Seller	43
6.3	Conditions Precedent to Obligation of Purchaser	44
ARTICLE VII INDEMNIFICATION		45
7.1	Indemnification.	45
7.2	Certain Limitations.	46
7.3	Notice of Loss; Procedures for Third-Party Claims.	48
7.4	Treatment of Indemnification Payments.	48
7.5	Remedies Exclusive	49
7.6	Mitigation	49
ARTICLE VIII TERMINATION		49
8.1	Termination Events	49
8.2	Effect of Termination	50
ARTICLE IX MISCELLANEOUS AGREEMENTS OF THE PARTIES		50
9.1	Notices	50

-ii-

TABLE OF CONTENTS

(Continued)

		Page
9.2	Severability	51
9.3	Counterparts	51
9.4	Expenses	51
9.5	Assignment	51
9.6	Amendment; Waiver	51
9.7	Specific Performance	51
9.8	Third Parties	52
9.9	Governing Law	52
9.10	Consent to Jurisdiction; Waiver of Jury Trial	52
9.11	Disclosure Letter	52
9.12	Entire Agreement	52
9.13	Further Assurances Regarding Transaction Documents	52
9.14	Section Headings; Table of Contents	53

EXHIBIT A Release

EXHIBIT B Transition Services Agreement

EXHIBIT C License Agreement

EXHIBIT D Professional Services Agreement

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SECURITIES PURCHASE AGREEMENT

This Securities Purchase Agreement (this “Agreement”) is dated as of April 28, 2010, between AOL Inc., a Delaware corporation (“Seller”), and Digital Sky Technologies Limited, a British Virgin Islands company (“Purchaser”) (each, a “Party” and collectively, the “Parties”).

W I T N E S S E T H:

WHEREAS, AOL Advertising Inc., a Delaware corporation and a wholly-owned subsidiary of Seller (“Seller Subsidiary”), owns all the issued and outstanding limited liability company interests (the “Securities”) of ICQ LLC, a Delaware limited liability company (the “Company”);

WHEREAS, the Company and its Subsidiary, ICQ Ltd., an Israeli company (the “Company Subsidiary”) are engaged in the international business of providing online, real-time communication services (including desktop and mobile) and products (including instant messaging, text, video and voice services as well as various entertainment and community products), and software related to such services and products, in each case, under the ICQ brand as currently conducted by Seller, the Company and the Company Subsidiary (the “Business”); and

WHEREAS, Seller wishes to sell to Purchaser, and Purchaser wishes to purchase from Seller, the Securities of the Company, all upon the terms and subject to the conditions set forth herein.

NOW, THEREFORE, in consideration of the mutual covenants, representations and warranties herein contained and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:

ARTICLE I

DEFINITIONS AND RULES OF CONSTRUCTION

1.1 Definitions. Unless otherwise provided herein, capitalized terms used in this Agreement have the meanings ascribed to them in this Section 1.1.

“Accounting Referee” shall have the meaning set forth in Section 2.3(b).

“Acquisition Proposal” shall have the meaning set forth in Section 5.9(a).

“Affiliate” of a Person means a Person that directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with, the first mentioned Person. For purposes of this definition, “control,” when used with respect to any specified Person, means the power to direct or cause the direction of the management and policies of such Person, directly or indirectly, whether through ownership of voting securities or by contract or otherwise, and the terms “controlling” and “controlled by” have meanings correlative to the foregoing.

“Aggregate Cap” shall have the meaning set forth in Section 7.2(a).

“Aggregate Purchase Price” shall have the meaning set forth in Section 2.2.

“Agreement” shall have the meaning set forth in the Preamble to this Agreement.

“AIM/ICQ Interop Period” shall have the meaning set forth in Section 5.10(c).

“Allocation Schedule” shall have the meaning set forth in Section 2.7.

“Antitrust Regulations” shall have the meaning set forth in Section 3.2(b).

“Assets” means all assets and properties, real and personal, and tangible and intangible.

“Books and Records” shall have the meaning set forth in Section 5.5(d).

“Business” shall have the meaning set forth in Recitals to this Agreement.

“Business Day” means any day other than a Saturday, a Sunday or a day on which banks in New York City are permitted or required by Law to close.

“Cap” shall have the meaning set forth in Section 7.2(a).

“Chosen Courts” shall have the meaning set forth in Section 9.10.

“Closing” shall have the meaning set forth in Section 2.4.

“Closing Cash” means all cash and cash equivalents of the Company and the Company Subsidiary as of the close of business on the day before the Closing Date, as determined without giving effect to the transactions contemplated by this Agreement and in accordance with GAAP consistently applied.

“Closing Date” means the date on which the Closing occurs.

“Closing Indebtedness” means the Indebtedness of the Company and the Company Subsidiary as of the Closing Date, as determined without giving effect to the transactions contemplated by this Agreement and in accordance with GAAP consistently applied.

“Closing Statement” shall have the meaning set forth in Section 2.3(a).

“Closing Statement Response Notice” shall have the meaning set forth in Section 2.3(a).

“Closing Working Capital” means the consolidated current assets of the Company and the Company Subsidiary less the consolidated current liabilities of the Company and the Company Subsidiary as of the close of business on the day before the Closing Date, all determined without giving effect to the transactions contemplated by this Agreement and, subject to Section 2.3(a), in accordance with GAAP consistently applied; provided, however, that notwithstanding the foregoing, Closing Working Capital shall specifically exclude (a) Closing Cash, (b) the current portion of any Closing Indebtedness and (c) any and all Tax assets and Tax liabilities.

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

“Company” shall have the meaning set forth in the Recitals to this Agreement.

“Company Employee” means any current or former employee, director or independent contractor of the Company or the Company Subsidiary.

“Company Intellectual Property” means all Intellectual Property Rights owned by the Company or Company Subsidiary or used by the Company or Company Subsidiary in the Business.

“Company Interoperability Trademarks” shall have the meaning set forth in Section 5.10(d).

-2-

“Company Material Adverse Effect” means (a) any result, occurrence, fact, change, event or effect (“Effect”) that has, or would reasonably be expected to have, a material adverse effect on the business, operations, assets, liabilities, earnings, condition (financial or otherwise) or results of operations of the Company and the Company Subsidiary, taken as a whole, or (b) a material impairment on the ability of Seller to execute, deliver and perform this Agreement and to timely consummate the transactions contemplated hereby and any documents delivered or entered into in connection herewith; provided that none of the following shall be deemed, either alone, or in combination, to constitute, or be taken into account when determining whether there has occurred, a Company Material Adverse Effect: any Effect resulting from or arising out of (i) the public announcement of the entering into this Agreement or the pendency of the transactions contemplated hereby or the identity of the Purchaser (including in this exception any resignation of senior management or other key employees due to the involvement of Purchaser in the transactions contemplated by the Transaction Documents or Purchaser’s plans with respect to the Business (or lack thereof) but excluding from this exception resignations due to the fact of a change of control at the Business irrespective of the buyer or in the ordinary course, so long as Purchaser has used commercially reasonable efforts to cause the employees of the Business to remain), (ii) changes in national or world economies or financial markets or changes in general economic or business conditions, including prevailing interest rates and credit market conditions (other than those that have had a materially disproportionate adverse Effect on the Company and the Company Subsidiary, taken as a whole, relative to other industry participants), (iii) general conditions in any industry in which the Business is currently conducted (other than those that have had a materially disproportionate adverse Effect on the Company and the Company Subsidiary, taken as a whole, relative to other industry participants), (iv) any natural disaster, acts of terrorism, military action or war (whether or not declared) or any escalation or worsening thereof (other than those that have had a materially disproportionate adverse Effect on the Company and the Company Subsidiary, taken as a whole, relative to other industry participants), (v) the failure of the Company and the Company Subsidiary to meet any projections, forecasts or budgets in and of itself (and not the underlying causes of such failure unless they are otherwise expressly excluded in clauses (i) through (vii) of this definition), (vi) any change in any applicable Law or GAAP or interpretation thereof or (vii) taking or not taking any actions expressly required by the Transaction Documents, or at the prior written request of, or due to the refusal of prior written consent from (to the extent such consent is expressly required by the Transaction Documents), Purchaser.

“Company Plans” means each plan, scheme, fund or arrangement that provides Retirement Benefits, and each severance, change in control or employment plan, program or agreement, and vacation, incentive, bonus, stock option, stock purchase, and restricted stock plan, program or policy under which any Company Employee has any present or future right to benefits and under which the Company or the Company Subsidiary has any present or future liability.

“Company Subsidiary” shall have the meaning set forth in the Recitals to this Agreement.

“Company Trademarks” shall have the meaning set forth in Section 5.10(b).

“Confidential Information” shall have the meaning set forth in Section 5.2(b).

“Consent” shall have the meaning set forth in Section 5.3(a).

“Contracts” means all written or legally binding oral commitments, contracts, options, licenses, understandings, indentures and agreements (including all amendments, modifications and other supplements thereto).

“Deductible” shall have the meaning set forth in Section 7.2(c).

-3-

“Disclosure Letter” shall have the meaning set forth in the first sentence of ARTICLE III.

“Distribution Agreement” shall have the meaning set forth in Section 3.18.

“Dollars” or “$,” when used in this Agreement or any other Transaction Document, means United States dollars unless otherwise stated.

“Effect” shall have the meaning set forth in the definition of Company Material Adverse Effect.

“Environmental Claim” means any written claim, Proceeding, suit, complaint, demand, request for information, notice of violation, or notice of responsibility alleging violation of, or liability under, any Environmental Laws.

“Environmental Laws” means any applicable United States or foreign, federal, state or local Laws imposing standards regarding the protection of the environment or, to the extent relating to exposure to Hazardous Materials, human health and safety.

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended.

“Final Closing Adjustment” shall have the meaning set forth in Section 2.3(c).

“Financial Statements” shall have the meaning set forth in Section 3.16.

“Free or Open Source Software” means any software (in source or object code form) licensed from a third party under (a) a license commonly referred to as an open source, free software, copyleft or community source code license (including but not limited to any library or code licensed under the GNU General Public License, GNU Lesser General Public License, Apache Software License, or any other public source code license arrangement) or (b) any other license that requires, as a condition of the distribution of software subject to such license, that a modification or derivative work of such licensed software be (i) disclosed, distributed, made available, offered, licensed or delivered in source code form, (ii) licensed for the purpose of making derivative works, (iii) licensed under terms that allow reverse engineering, reverse assembly, or disassembly of any kind, or (iv) redistributable at no charge.

“GAAP” means generally accepted accounting principles of the United States as in effect from time to time.

“Grant” shall have the meaning set forth in Section 3.22.

“Governmental Authority” shall have the meaning set forth in Section 3.3.

“Guarantee Agreement’ shall have the meaning set forth in Section 3.16(c).

“Hazardous Materials” means any material regulated, defined or identified as a pollutant or contaminant, or as toxic or hazardous, pursuant to any Environmental Law.

“Higher Threshold” means the amount of Purchaser Losses arising from any single Effect or a series of related or substantially similar Effects to the extent such Purchaser Losses exceed thirty thousand dollars ($30,000) individually.

“ICQ Software” shall have the meaning set forth in Section 5.10(g).

-4-

“Indebtedness” means, without duplication (a) all indebtedness for borrowed money, whether current or funded, secured or unsecured; (b) that portion of obligations with respect to capital leases that is properly classified (or should be properly classified) as a liability on a balance sheet in conformity with GAAP; (c) notes payable and drafts accepted representing extensions of credit whether or not representing obligations for borrowed money (for the avoidance of doubt, excluding any trade accounts payable and checks payable to the Company or the Company Subsidiary which have been endorsed by them for collection in the ordinary course of business); (d) all amounts drawn under outstanding letters of credit; (e) all interest rate swap, derivative or similar arrangements; (f) all obligations for the deferred purchase price of any property or services (other than trade accounts payable and checks payable to the Company or the Company Subsidiary which have been endorsed by them for collection in the ordinary course of business); (g) all obligations secured by a purchase money mortgage or other lien to secure all or part of the purchase price of property subject to such mortgage or lien; (h) all obligations secured by liens on Assets acquired by the Company or the Company Subsidiary, whether or not such obligations were assumed by the Company or the Company Subsidiary at the time of acquisition of such Assets; (i) all obligations of a type referred to in clauses (a)-(h) above which is directly or indirectly guaranteed by the Company or the Company Subsidiary or which the Company or the Company Subsidiary has agreed (contingently or otherwise) to purchase or otherwise acquire or in respect of which it has otherwise assured a credit against loss, and (j) any refinancings of the foregoing, including principal, interest, prepayment penalties and similar obligations thereto and Taxes associated with the payment of any such amount.

“Indemnified Party” shall have the meaning set forth in Section 7.2(e).

“Indemnifying Party” shall have the meaning set forth in Section 7.3(a).

“Intellectual Property Rights” means all worldwide intellectual property rights, including: (a) patents, inventions, discoveries and invention disclosures (whether or not patented) (collectively, “Patents”), (b) rights under applicable trade secrets laws and regulations in each of the following: know-how, confidential or proprietary information, algorithms, data (including user related data but excluding Personal Data), designs, processes, drawings, blueprints, flow charts, models, strategies, techniques, source code and source code documentation (collectively, “Trade Secrets”), (c) copyrights in both published and unpublished works, including without limitation, copyrights in all compilations, design rights and database rights, computer programs, manuals and other documentation, and all derivatives, translations, adaptations and combinations of the above (collectively, “Copyrights”), (d) rights in each of the following: trademarks, service marks, trade dress, logos and other source indicators and the goodwill and all common law rights relating thereto (“Trademarks”), (e) all rights in domain names, (f) all registrations, applications, divisions, continuations, continuations-in-part, re-issues, re-examinations, renewals and foreign counterparts for any of the foregoing items (“Registered IP”) and (g) the right to bring claims of infringement and misappropriation of the foregoing against third parties. For clarity, the foregoing definition refers only to intangible legal rights, and does not include any personal property, equipment or media in which any of the foregoing are embodied.

“IT Systems” means personal property, equipment and physical or electronic media relating to communications and computer systems, including computer hardware, networks and peripherals. For clarity, IT Systems does not include any Intellectual Property Rights related to or embodied in any of the foregoing items.

“ITA” shall have the meaning set forth in Section 2.8(a).

“ITA Withholding Certificate” shall have the meaning set forth in Section 2.8(c).

-5-

To “the knowledge of” a Party or a Party’s “knowledge” means, with respect to Seller, the actual knowledge of the Persons identified on Section D of the Disclosure Letter, and with respect to Purchaser, the actual knowledge of all directors and officers of Purchaser.

“Law” means any law, treaty, statute, ordinance, rule, code or regulation of a Governmental Authority or judgment, decree, order, writ, award, injunction or determination of an arbitrator or court or other Governmental Authority.

“Lease” means a lease, sublease, license or other agreement of the Company or the Company Subsidiary regarding the use or occupancy of real property.

“Leased Assets” shall have the meaning set forth in Section 3.18.

“Liabilities” means all liabilities, obligations, guarantees, commitments, damages, losses, debts, claims, demands, judgments or settlements of any nature or kind, whether known or unknown, accrued or fixed, absolute or contingent, or matured or unmatured.

“License Agreement” shall have the meaning set forth in Section 5.6.

“Licensed Assets” shall have the meaning set forth in Section 3.18.

“Liens” means any mortgage, easement, lease, sublease, right of way, trust or title retention agreement, defect in title, pledge, lien (including any lien for unpaid Taxes), claim, charge, security interest, option or any restriction or other encumbrance of any kind (excluding transfer restrictions under any applicable securities Laws).

“Losses” means Purchaser Losses or Seller Losses, as the case may be.

“Lower Threshold” means the amount of Purchaser Losses arising from any single Effect or a series of related or substantially similar Effects to the extent such Purchaser Losses exceed fifteen thousand dollars ($15,000) individually.

“Manager” shall mean a manager as such term is used in the Delaware Limited Liability Company Act, Title 6, §§ 18-101, et seq. and a “Director” as such term is used in the Limited Liability Company Agreement dated as of November 27, 2007 by Advertising.com, Inc., and shall only refer to a person only in such capacity and shall not refer to employees generally or refer to a person in such person’s employment capacity.

“Material Contract” shall have the meaning set forth in Section 3.6(a).

“New Plan” shall have the meaning set forth in Section 5.6(c).

“Order” shall have the meaning set forth in Section 3.7.

“Outer Date” means the four (4) month anniversary date of the date of this Agreement; provided, however, that if the conditions in Section 6.1(b) have not yet been fulfilled but all other conditions to Closing shall or shall be capable of being fulfilled by such date, then the Outer Date shall automatically be extended to the twelve (12) month anniversary date of the date of this Agreement.

“Owned Assets” shall have the meaning set forth in Section 3.18.

-6-

“Party” and “Parties” shall have the respective meanings set forth in the Preamble to this Agreement.

“Patent Security Agreement” shall have the meaning set forth in Section 3.16(c).

“Permits” shall have the meaning set forth in Section 3.14.

“Permitted Liens” means (a) Liens for Taxes, assessments and other governmental charges not yet due and payable or, if due and payable, being contested in good faith by appropriate Proceedings, (b) mechanics’, workmen’s, repairmen’s, warehousemen’s, carriers’ or other similar Liens, including all statutory Liens, arising or incurred in the ordinary course of business, (c) Liens of landlords under any Leases and (d) with respect to any real property, (i) easements, quasi-easements, licenses, covenants, rights-of-way or other similar restrictions, (ii) any conditions that may be shown by a current survey, (iii) zoning, building, subdivision or other similar requirements or restrictions and (iv) Liens that do not materially affect the use of the underlying assets of the Company or the Company Subsidiary for the purpose they are being utilized on the date of this Agreement.

“Person” means an individual, corporation, partnership, limited liability company, association, trust, incorporated organization, other entity or group (as defined in Section 13(d)(3) of the United States Securities Exchange Act of 1934, as amended).

“Personal Data” means any and all data that concerns an identified and/or identifiable individual natural person who is a registered user of the Company’s Products.

“Post-Closing Portion” shall have the meaning set forth in Section 7.1(d).

“Post-Signing Material Contracts” shall have the meaning set forth in Section 3.6(b).

“Pre-Closing Portion” shall have the meaning set forth in Section 7.1(d).

“Pre-Closing Service” shall have the meaning set forth in Section 5.6(b).

“Pre-Closing Tax Periods” shall have the meaning set forth in Section 5.12(b).

“Preparation Period” shall have the meaning set forth in Section 2.3(a).

“Proceeding” means any claim, demand, action, arbitration, mediation, audit, hearing, proceeding, investigation, litigation or suit (whether civil, criminal, alternative dispute resolution, judicial, administrative or investigative).

“Products” means those software products and related services currently being provided by the Company and the Company Subsidiary in the conduct of the Business, including any content incorporated in, linked to, bundled with or otherwise used in such products and/or services.

“Professional Services Agreement” shall have the meaning set forth in Section 5.7.

“Purchase Price” shall have the meaning set forth in Section 2.2.

“Purchase Price Bank Account” means a bank account in the United States to be designated by Seller in a written notice to Purchaser at least five (5) Business Days before the Closing.

“Purchaser” shall have the meaning set forth in the Preamble to this Agreement.

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“Purchaser Indemnified Party” shall have the meaning set forth in Section 7.1(a).

“Purchaser Losses” shall have the meaning set forth in Section 7.1(a).

“Purchaser Material Adverse Effect” means a material impairment on the ability of Purchaser to execute, deliver and perform this Agreement and to timely consummate the transactions contemplated hereby and any documents delivered or entered into in connection herewith.

“Purchaser Specified Reps” shall have the meaning set forth in Section 7.2(d).

“Real Property” shall have the meaning set forth in Section 3.5(a).

“Registered IP” shall have the meaning set forth in the definition of Intellectual Property Rights.

“Release” shall be defined as that term is defined in 42 U.S.C. § 9601 (22).

“Retained Benefits” shall have the meaning set forth in Section 3.18.

“Retained Services” shall have the meaning set forth in Section 3.18.

“Retirement Benefits” means any pension, lump sum, gratuity or similar benefits provided or to be provided on or after retirement (including early retirement), death or disability, in respect of a Company Employee’s employment or services with the Company or the Company Subsidiary, but excluding benefits provided under an arrangement, the sole purpose of which is to provide benefits on the accidental injury or death of a Company Employee.

“Review Period” shall have the meaning set forth in Section 2.3(a).

“Securities” shall have the meaning set forth in the Recitals to this Agreement.

“Securities Act” shall mean the Securities Act of 1933, as amended.

“Security Agreement” shall have the meaning set forth in Section 3.16(c).

“Seller” shall have the meaning set forth in the Preamble to this Agreement.

“Seller Corporate Policies” shall have the meaning set forth in Section 5.10.

“Seller Indemnified Party” shall have the meaning set forth in Section 7.1(b).

“Seller Interoperability Trademarks” shall have the meaning set forth in Section 5.10(c).

“Seller Losses” shall have the meaning set forth in Section 7.1(b).

“Seller Specified Reps” shall have the meaning set forth in Section 7.2(d).

“Seller Subsidiary” shall have the meaning set forth in the Recitals to this Agreement.

“Seller Trademarks” shall have the meaning set forth in Section 5.10(a).

“Subsidiary” or “Subsidiaries” of Purchaser, Seller or any other Person means any corporation, partnership or other legal entity of which Purchaser, Seller or such other Person, as the case may be

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(either alone or through or together with any other Subsidiary), (a) owns, directly or indirectly, more than fifty percent (50%) of the stock or other equity interests of such corporation, partnership or other legal entity or (b) is entitled to vote for the election of at least a majority of the members of the board of directors or other governing body of such corporation, partnership or other legal entity.

“Subsidiary Price” shall have the meaning set forth in Section 2.7.

“Target Working Capital” means three hundred fifty thousand dollars ($350,000.00).

“Tax” or “Taxes” means any federal, state, local or foreign income, alternative or add-on minimum, gross income, gross receipts, windfall profits, severance, property, production, sales, use, transfer, stamp, value added, assessment, unclaimed property, gains, license, excise, franchise, employment, payroll, withholding or minimum tax, transfer, goods and services, or any other tax, custom, duty or other like assessment or charge of any kind whatsoever, together with any interest or any penalty, addition to tax or additional amount imposed thereon by any Governmental Authority.

“Tax Return” means any return, declaration, report, claim for refund, information return or other document, filed or required to be filed with respect to Taxes, including any schedule, statement, information or attachment thereto, and including any amendment thereof.

“Trademark” shall have the meaning set forth in the definition of Intellectual Property Rights.

“Transaction Documents” shall have the meaning set forth in Section 3.2(a).

“Transfer Taxes” shall have the meaning set forth in Section 5.12(a)(i).

“Transition Services Agreement” shall have the meaning set forth in Section 5.7.

“Withholding Trust” shall have the meaning set forth in Section 2.8(c).

1.2 Rules of Construction.

(a) This Agreement shall be construed without regard to any presumption or rule requiring construction or interpretation against the Party drafting or causing any instrument to be drafted.

(b) The words “hereof,” “herein” and “hereunder” and words of similar import when used in this Agreement will refer to this Agreement as a whole (including any exhibits and schedules to this Agreement) and not to any particular provision of this Agreement, and section and subsection references are to this Agreement unless otherwise specified. The words “include,” “including,” or “includes” when used herein shall be deemed in each case to be followed by the words “without limitation” or words having similar import. The headings and table of contents in this Agreement are included for convenience of reference only and will not limit or otherwise affect the meaning or interpretation of this Agreement. The meanings given to terms defined herein will be equally applicable to both the singular and plural forms of such terms. To the extent this Agreement refers to information or documents having been made available (or delivered or provided) to Purchaser, Seller shall be deemed to have satisfied such obligation if Seller or its representatives made such information or document available in the on-line data room or delivered or provided such information or document to any officer of Purchaser or any of Purchaser’s representatives.

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ARTICLE II

PURCHASE AND SALE

2.1 Purchase and Sale of Securities. Upon the terms and subject to the conditions in this Agreement, at the Closing, Seller shall, and shall cause the Seller Subsidiary to, sell, assign and transfer to Purchaser, and Purchaser shall purchase, the Securities free and clear of all Liens.

2.2 Purchase Price. The aggregate purchase price for the Securities shall be $187,500,000 (the “Aggregate Purchase Price”), as adjusted pursuant to provisions of Section 2.3 below (as so adjusted, the “Purchase Price”).

2.3 Purchase Price Adjustments.

(a) Post-Closing Estimates. Within one hundred and twenty (120) days following the Closing Date (the “Preparation Period”), Seller shall prepare and deliver to Purchaser a statement (the “Closing Statement”) setting forth Seller’s calculation of (i) the Closing Cash, (ii) the Closing Indebtedness and (iii) the Closing Working Capital, in each case along with reasonable supporting detail to evidence the calculation of such amount. During the Preparation Period, Purchaser shall, and shall cause the Company and Company Subsidiary to, provide Seller and its representatives with reasonable access to its officers, employees, agents and other personnel to the extent reasonably necessary to enable the Seller to prepare, deliver and verify the Closing Statement and the information contained therein. The Closing Statement shall be prepared on a basis consistent with the accounting methodologies, practices, estimation techniques, assumptions and principles used in the preparation of the Financial Statements and, in the case of the Closing Working Capital, such accounting methodologies, practices, estimation techniques, assumptions and principles used in establishing the Target Working Capital. Purchaser and its representatives shall have ninety (90) days following its receipt of the Closing Statement and the supporting detail (the “Review Period”) to review the same. During the Review Period, Seller shall provide Purchaser and its representatives with reasonable access, during normal business hours and in a non-disruptive manner, to its and the Seller’s officers, employees, agents and other personnel to the extent reasonably necessary to enable the Purchaser to review and verify the Closing Statement and the information contained therein. On or before the expiration of the Review Period, Purchaser shall deliver to Seller a written statement accepting or objecting to the Closing Statement (the “Closing Statement Response Notice”). If Purchaser does not deliver a Closing Statement Response Notice to Purchaser within the Review Period, Purchaser shall be deemed to have accepted the Closing Statement in its entirety.

(b) Disputes. In the event that Purchaser objects to all or any portion of the Closing Statement within the Review Period, Purchaser and Seller shall promptly meet and in good faith attempt to resolve such objections. Any such objections which cannot be resolved between Purchaser and Seller within thirty (30) days following Seller’s receipt of the Closing Statement Response Notice shall be resolved in accordance with this Section 2.3(b). Should Seller and Purchaser not be able to resolve such objections set forth in the Closing Statement Response Notice within the thirty (30) day period described above, either Party may submit the matter to an internationally recognized accounting firm mutually acceptable to the Parties (the “Accounting Referee”) for review and resolution, with instructions to complete the same as promptly as practicable, but in any event within thirty (30) days of the submission of the dispute to the Accounting Referee, and to resolve any objections consistent with the terms of this Agreement, including making the calculations in accordance with the definitions of Closing Cash, Closing Indebtedness and Closing Working Capital, as applicable, as set forth in this Agreement. The Accounting Referee shall only have authority to make determinations in respect of those specific items for which an objection has been raised in the Closing Statement Response Notice, and all determinations shall be based solely on the presentations of Purchaser and Seller and their respective representatives, and

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not by independent review. In resolving any disputed item, the Accounting Referee: (i) shall be bound by the principles set forth in this Section 2.3(b), (ii) shall not assign a value to any item greater than the greatest value for such item claimed by either Party or less than the smallest value for such item claimed by either Party and (iii) shall not increase the total purchase price adjustment more than the increase proposed by the Seller nor decrease the total purchase price adjustment more than the decrease proposed by the Purchaser, as applicable. The Accounting Referee shall deliver a statement setting forth its resolution of the dispute within thirty (30) days of the submission of the dispute to the Accounting Referee, which resolution, absent manifest error, shall be binding and conclusive on the parties and not subject to appeal; provided, however, that such determination may be reviewed, corrected or set aside by a court of competent jurisdiction (as set forth in Section 9.10), but only if and to the extent that the Accounting Referee is found by such court of competent jurisdiction to have made mathematical errors with respect to its determination or failed to follow the principles set forth in this Section 2.3(b). The Closing Statement shall be modified if necessary to reflect such determination by the Accounting Referee. The Accounting Referee may not award damages or penalties. The fees and costs of the Accounting Referee, if one is required, shall be payable by Purchaser, on the one hand, and Seller, on the other hand, based upon the percentage which the portion of the contested amount not awarded to each party bears to the amount actually contested by such party, as determined by the Accounting Referee.

(c) Post-Closing Adjustments. The Purchase Price payable by Purchaser to Seller shall be (i) increased by the amount of Closing Cash as finally determined by this Section 2.3, (ii) increased or decreased by the amount, if any, by which Closing Working Capital as finally determined pursuant to this Section 2.3 exceeds Target Working Capital or Target Working Capital exceeds Closing Working Capital as finally determined pursuant to this Section 2.3, respectively (provided that no adjustment to the Purchase Price shall be made pursuant to this clause (ii) if such adjustment would result in an increase or decrease of less than two hundred fifty thousand dollars ($250,000.00)), and (iii) decreased by the Closing Indebtedness as finally determined pursuant to this Section 2.3. The foregoing adjustments shall be aggregated for purposes of determining any amounts that may be due from Purchaser to Seller or Seller to Purchaser pursuant to this Section 2.3(c) (any adjustment to the purchase price pursuant to this Section 2.3(c), the “Final Closing Adjustment”).

(d) Payments. In the event that the Final Closing Adjustment is a negative adjustment to the Purchase Price, Seller shall pay to Purchaser an amount in cash equal to the Final Closing Adjustment within five (5) Business Days of the final determination of the Final Closing Adjustment. In the event the Final Closing Adjustment is a positive adjustment to the Purchase Price, Purchaser shall pay to Seller an amount in cash equal to the Final Closing Adjustment within five (5) Business Days of the final determination of the Final Closing Adjustment. Any Final Closing Adjustment shall be made by wire transfer in immediately available funds. With respect to any accounts receivable included in Closing Working Capital that are payable to the Seller or one of its Subsidiaries (other than the Company and the Company Subsidiary), the Seller shall cause amounts received in respect of such receivables to be paid to Purchaser (or, at Purchaser’s option, to the Company or the Company Subsidiary) promptly upon receipt and, at Purchaser’s cost and expense, Seller shall take such reasonable actions to collect any such receivables as Purchaser shall request. With respect to any accounts payable included in Closing Working Capital that are payable by Seller or one of its Subsidiaries (other than the Company and the Company Subsidiary), the Purchaser shall assume and pay such payables when due.

2.4 Closing. Subject to the terms and conditions of this Agreement, the sale and purchase of the Securities contemplated by this Agreement shall take place at a closing (the “Closing”) to be held at the offices of Simpson Thacher & Bartlett LLP, 1155 F Street N.W., Washington, DC 20004 at 9:00 a.m. local time on the second Business Day following the satisfaction or waiver of the conditions to the obligations of the parties hereto set forth in ARTICLE VI or at such other place or at such other time or on such other date as Seller and Purchaser may mutually agree upon in writing.

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2.5 Closing Deliveries by Seller. At the Closing, Seller shall deliver or cause to be delivered to Purchaser:

(a) an assignment agreement, or other appropriate transfer forms, in respect of the Securities duly completed and executed in favor of Purchaser or its nominee in a form reasonably satisfactory to Purchaser;

(b) executed counterparts to the Transition Services Agreement;

(c) executed counterparts to the License Agreement;

(d) executed counterparts to the Professional Services Agreement;

(e) a receipt for the Aggregate Purchase Price;

(f) executed counterparts to the mutual release of claims in the form of Exhibit A attached hereto (the “Release”) executed by Seller and the Seller Subsidiary;

(g) a certificate of good standing (or other equivalent documents) of the Company issued not earlier than five (5) Business Days prior to the Closing Date;

(h) a certificate of a duly authorized officer of Seller certifying as to the matters set forth in Section 6.3; and

(i) a certificate of the Secretary of Seller certifying as to (i) true, correct and complete copies of the certified Certificate of Formation of the Company and the Limited Liability Company Agreement of the Company, (ii) the organizational documents of the Company Subsidiary and (iii) the resolutions of the Board of Directors of Seller approving this Agreement and the transactions contemplated hereby.

2.6 Closing Deliveries by Purchaser. At the Closing, Purchaser shall deliver or cause to be delivered to Seller:

(a) the Aggregate Purchase Price by wire transfer in immediately available funds to the Purchase Price Bank Account;

(b) executed counterparts to the Transition Services Agreement;

(c) executed counterparts to the License Agreement;

(d) executed counterparts to the Professional Services Agreement;

(e) executed counterparts to the Release; and

(f) a certificate of a duly authorized officer of Purchaser certifying as to the matters set forth in Section 6.2.

2.7 Allocation of Purchase Price. Seller and Purchaser agree to allocate two million, six hundred thousand dollars ($2,600,000) to the shares of the Company Subsidiary (the “Subsidiary Price”) and to allocate the remainder of the Purchase Price (and all other capitalizable costs) among the other Assets of the Company for all Tax purposes in accordance with an allocation schedule (the “Allocation Schedule”) prepared by Seller, such Allocation Schedule subject to Purchaser’s review and consent and

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prepared in accordance with Section 1060 of the Code and Treasury Regulations promulgated thereunder and consistent with the methodology agreed to in writing by Seller and Purchaser prior to the Closing; provided, however, that in the event that Seller and Purchaser cannot reach agreement with respect to the Allocation Schedule within ninety (90) days of the Closing, the Accounting Referee shall resolve any disputed portion of the Allocation Schedule; provided further, that the Subsidiary Price shall be adjusted to the amount allocated by the ITA, if different. The costs related to having the Accounting Referee prepare the Allocation Schedule shall be borne equally by Purchaser and Seller. Seller and Purchaser agree to file or cause to be filed all Tax Returns in respect of the assets of the Company in a manner consistent with the Allocation Schedule and to take no position for Tax purposes inconsistent with the Allocation Schedule, in each case unless required otherwise by a final determination of a competent taxing authority.

2.8 Withholding.

(a) Subject to Section 2.8(b), Purchaser shall be entitled to deduct and withhold from the Aggregate Purchase Price (but calculated based on the Subsidiary Price) such amounts as Purchaser is required to deduct or withhold therefrom under Israeli Law, unless Seller provides Purchaser, at least three (3) Business Days before Closing, with an ITA Withholding Certificate (as defined below) in respect of such payment, in which case Purchaser shall be entitled to deduct and withhold from the Aggregate Purchase Price only such amounts as Purchaser is required to deduct and withhold pursuant to such ITA Withholding Certificate. To the extent that such amounts are so withheld by Purchaser, except as otherwise provided in this Section 2.8, such withheld amounts shall be treated for all purposes of this Agreement as having been paid to Seller. Purchaser shall hold such withheld amounts in trust for the Seller until paid to the Israeli Taxing Authority (“ITA”) and shall cause any such withheld amounts to be paid to the ITA in accordance with Israeli Law in any event not earlier than three (3) Business Days prior to the last day on which such payment is required. Except as set forth in Section 2.8(b), upon receipt of an ITA Withholding Certificate from Seller, Purchaser shall promptly release to Seller any such withheld amounts not required by such ITA Withholding Certificate to be paid to the ITA. If Purchaser so withholds amounts and pays them to the ITA with respect to the Seller, Purchaser shall furnish to the Seller evidence of such withholding and payment.

(b) Notwithstanding Section 2.8(a), to the extent that the Valid Withholding Certificate expressly provides that Purchaser is permitted to remit such withheld amounts to a trustee instead of the ITA and, after such transfer, Purchaser would have no liability under Israeli Law with respect to Israeli withholding Tax or other costs in connection with the transactions contemplated by this Agreement, then Purchaser shall release to the Withholding Trust any such withheld amounts (or such applicable portion thereof) in accordance with an ITA Withholding Certificate received at least three (3) Business Days prior to the last day on which the amounts so withheld must be paid to the ITA; provided that the costs, expenses and Liabilities of any such trustee or arrangement shall be borne solely by Seller.

(c) For the purpose of this Agreement, an “ITA Withholding Certificate” shall mean any certificate or other ruling, order or decision issued by the ITA in respect of Israeli withholding Tax in respect of the sale of the Securities pursuant to this Agreement and shall include a ruling allowing the transfer of any such Israeli withholding Tax amount to a trust or similar arrangement (“Withholding Trust”). Purchaser and Seller shall cooperate in good faith to obtain any such ITA Withholding Certificate.

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ARTICLE III

REPRESENTATIONS AND WARRANTIES OF SELLER

Seller represents and warrants to Purchaser, subject to the disclosures and exceptions set forth in the disclosure letter delivered by Seller to Purchaser on the date hereof (the “Disclosure Letter”), as follows:

3.1 Valid Existence. Each of Seller, Seller Subsidiary, the Company and the Company Subsidiary is duly organized and validly existing under the laws of its jurisdiction of organization. Each of Seller, Seller Subsidiary, the Company and the Company Subsidiary has the requisite corporate, limited liability company or similar power and authority to enter into this Agreement and the Transaction Documents, as applicable, to carry out its obligations hereunder and thereunder and to consummate the transactions contemplated hereby and thereby.

3.2 Proper Authority.

(a) This Agreement and the other agreements, instruments and documents to be executed and delivered in connection herewith, including the License Agreement, the Release, the Professional Services Agreement and the Transition Services Agreement (collectively, with this Agreement, the “Transaction Documents”), to which Seller, Seller Subsidiary, the Company or the Company Subsidiary is a party and the consummation of the transactions contemplated hereby and thereby involving such Persons have been duly authorized by Seller, Seller Subsidiary, the Company or the Company Subsidiary, as applicable, by all requisite corporate, limited liability company or other action prior to the Closing. This Agreement has been duly executed and delivered by Seller, and the other Transaction Documents will be duly executed and delivered by Seller, Seller Subsidiary, the Company and the Company Subsidiary, as applicable, and this Agreement constitutes, and the other Transaction Documents when so executed and delivered will constitute, a valid and legally binding obligation of Seller, Seller Subsidiary, the Company and the Company Subsidiary, as applicable, enforceable against each of them in accordance with its terms, except as enforceability may be affected by bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and other similar Laws relating to or affecting creditors’ rights generally, general equitable principles (whether considered in a Proceeding in equity or at law) and the implied covenant of good faith and fair dealing.

(b) Except for required filings under any applicable Laws relating to antitrust or competition, including, without limitation, any Law designed to prohibit, restrict or regulate actions for the purpose or effect of monopolization or restraint of trade (collectively, “Antitrust Regulations”) and compliance with any applicable securities laws, the execution and delivery of this Agreement and the other Transaction Documents by Seller, Seller Subsidiary, the Company and the Company Subsidiary, the performance by each of them of their obligations hereunder and thereunder and the consummation by each of them of the transactions contemplated hereby and thereby do not and will not (i) violate or conflict with any provision of the respective certificate of incorporation or by-laws or similar organizational documents of Seller, Seller Subsidiary, the Company and the Company Subsidiary, (ii) except as set forth on Section 3.2(b)(ii) of the Disclosure Letter, result in any violation or breach or constitute any default (with or without notice or lapse of time, or both) under, or give rise to a right of termination, cancellation or acceleration of any obligation or a loss of a benefit under, or result in the creation of any Lien under, in any material respect, any Contracts of the Company or the Company Subsidiary or by which any of their respective Assets are bound, or (iii) violate, conflict with or result in any breach under, in any material respect, any provision of any Law applicable to Seller.

3.3 Governmental Approvals and Consents. Except for any requirements under any Antitrust Regulations, no material Consent, order, or license from, notice to or registration, declaration or filing

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with, any United States or foreign, federal, state, provincial, municipal or local government agency, court of competent jurisdiction, administrative agency or commission or other governmental or regulatory authority or instrumentality (“Governmental Authority”), is required on the part of Seller, Seller Subsidiary, the Company or the Company Subsidiary in connection with the execution, delivery or performance of this Agreement or any of the other Transaction Documents or the consummation of the transactions contemplated hereby and thereby, except for such Consents, orders, licenses, filings or notices which have been or will be obtained as of the Closing Date and remain in full force and effect.

3.4 Capitalization; Ownership of Securities; Company Subsidiary.

(a) The Securities are validly issued, fully paid and nonassessable and were not issued in violation of any preemptive or similar rights created by statute, organizational documents of the Company or any Contract to which the Company is a party or bound, and have been issued in compliance of applicable securities Laws. There are no options, warrants, convertible securities or other rights, agreements, arrangements or commitments relating to the Securities or obligating Seller, Seller Subsidiary, the Company or the Company Subsidiary to issue or sell any limited liability company interests in, or any other interest in, the Company. The Securities constitute all the issued and outstanding limited liability company interests of the Company and are owned of record by Seller Subsidiary free and clear of all Liens.

(b) The capital stock of the Company Subsidiary is validly issued, fully paid and nonassessable and was not issued in violation of any preemptive or similar rights created by statute, organizational documents of the Company Subsidiary or any Contract to which the Company Subsidiary is a party or bound, and has been issued in compliance of applicable securities Laws. There are no options, warrants, convertible securities or other rights, agreements, arrangements or commitments relating to the capital stock of the Company Subsidiary or obligating Seller, Seller Subsidiary, the Company or the Company Subsidiary to issue or sell any capital stock of, or any other interest in, the Company Subsidiary. All of the capital stock of the Company Subsidiary is held by the Company free and clear of all Liens.

(c) Other than the Company Subsidiary, the Company does not, directly or indirectly, own or have the right or the obligation to acquire any capital stock or other equity or similar interest in, or any interest convertible or exchangeable or exercisable for, any capital stock or other equity or similar interest in, any Person. The Company Subsidiary does not, directly or indirectly, own or have the right or the obligation to acquire any capital stock or other equity interest in any Person.

3.5 Real Property.

(a) Neither the Company nor the Company Subsidiary owns, or has ever owned, any real property (“Real Property”).

(b) Section 3.5(b) of the Disclosure Letter contains a true, complete and correct list of all Leases as of the date hereof. True, correct and complete copies of each Lease have been delivered, or made available, to Purchaser. Each Lease is in full force and effect and enforceable against the Company or the Company Subsidiary, as applicable, and, to the knowledge of Seller as of the date hereof, against the applicable landlord party in accordance with its terms, except as enforceability may be affected by bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and other similar Laws relating to or affecting creditors’ rights generally, general equitable principles (whether considered in a Proceeding in equity or at law) and the implied covenant of good faith and fair dealing. None of the Company, the Company Subsidiary or, to Seller’s knowledge as of the date hereof, the applicable landlord, is in material default in the performance, observance or fulfillment of any material obligation,

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covenant or condition contained in any Lease, and no event caused by or relating to or affecting the Company or the Company Subsidiary or otherwise, has occurred that (with or without the giving of notice or lapse of time, or both) would constitute a material default by the Company or the Company Subsidiary thereunder which would result in the termination or cancellation thereof, diminish the enforceability thereof, in any material respect, or otherwise contravene, conflict with or modify the material terms and requirements of any such Lease. Neither the Company nor the Company Subsidiary have received a written notice from any landlord of any default (or condition or event which, after notice or lapse of time or both, would constitute a default) under any such Lease.

3.6 Material Contracts.

(a) Section 3.6(a) of the Disclosure Letter lists each of the following Contracts to which the Company or the Company Subsidiary is a party, or by which any of its Assets are bound as of the date hereof (such Contracts being “Material Contracts”):

(i) any Contract (a) containing covenants binding upon the Company or the Company Subsidiary that restrict the ability of the Company or the Company Subsidiary to compete in any geographic area or in any other manner that is material to the Business, (b) granting any exclusive rights to make, sell or distribute products and services of the Company or the Company Subsidiary, or otherwise prohibiting or limiting in any material respect the right of the Company or the Company Subsidiary to develop, manufacture, market, sell or distribute any products or services or (c) agreeing to purchase goods or services exclusively from a specified Person; provided, however, that this subsection (i) shall not include Material Contracts that may be fully canceled by the Company or the Company Subsidiary upon notice of ninety (90) days or less without any payment, penalty or other significant obligation;

(ii) any Contract relating to Indebtedness of the Company or the Company Subsidiary;

(iii) any Contract relating to the payment by or to the Company or the Company Subsidiary of more than $200,000 in respect of customers or vendors, including all local strategic partnership agreements and revenue-sharing agreements;

(iv) any Contract relating to any single or series of related capital expenditures by the Company or the Company Subsidiary in excess of $200,000;

(v) any Contract relating to any settlement agreement of the Company or the Company Subsidiary, other than (A) releases immaterial in nature or entered into with former employees or independent contractors of the Company or the Company Subsidiary in the ordinary course of business consistent with past practice in connection with the cessation of such employee’s employment or independent contractor’s engagement with the Company or the Company Subsidiary, (B) settlement agreements for cash only (which has been paid or fully accrued for) not exceeding $200,000 as to such settlement or (C) settlement agreements under which none of the Company or the Company Subsidiary have any continuing obligations, liabilities or rights (excluding releases);

(vi) any Contract for the sale or disposition of, or which creates a Lien on, any material Assets of the Company or the Company Subsidiary;

(vii) any Contract pursuant to which the Company or the Company Subsidiary granted any significant rights in or to Intellectual Property Rights by any other Person or any IT Systems of any other Person, or any Contract pursuant to which any Person is granted rights in or to Intellectual

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Property Rights or any IT Systems owned by the Company and the Company Subsidiary (in each case, other than (A) off-the-shelf software licenses, (B) generally commercially available agreements with annual fees or a one-time fee of less than $100,000 or (C) non-exclusive licenses granted to users in the ordinary course of business pursuant to end user license agreements or similar documents, forms of which have been provided to Purchaser);

(viii) any Contract with any Governmental Authority or, to Seller’s knowledge, any Contract which is a sub-contract to any third party’s Contract with any Governmental Authority;

(ix) any Contract in which the Company or the Company Subsidiary has granted a “most favored nation” provision;

(x) any joint venture, partnership, manufacturer, development or supply agreement or other similar agreement which involves a sharing of revenues, profits, losses, costs or liabilities by the Company or the Company Subsidiary with any other Person;

(xi) any Contract with Seller, the Seller Subsidiary or any of their Affiliates;

(xii) any revocable or irrevocable power of attorney granted by the Company or the Company Subsidiary to any Person for any purpose whatsoever;

(xiii) any Contract pursuant to which the Company or the Company Subsidiary has undertaken to indemnify any of its directors, officers or other employees; and

(xiv) any other Contract involving more than $200,000 and not entered in the ordinary course of business consistent with past practice.

(b) Each Material Contract and each Contract entered into after the date hereof that would have been a Material Contract if in existence on the date hereof (the “Post-Signing Material Contracts”) is a valid, binding and enforceable obligation of the Company or the Company Subsidiary, as applicable, and, to Seller’s knowledge, the other parties thereto in accordance with its terms and conditions, except as enforceability may be affected by bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and other similar Laws relating to or affecting creditors’ rights generally, general equitable principles (whether considered in a Proceeding in equity or at law) and the implied covenant of good faith and fair dealing. Neither the Company nor the Company Subsidiary nor, to Seller’s knowledge as of the date hereof, any other party to any of the Material Contracts or Post-Signing Material Contracts is in material default under or in material violation of such Material Contract or Post-Signing Material Contracts, and none of Seller, Seller Subsidiary, the Company nor the Company Subsidiary has received any written notice of any default or event that with notice or lapse of time or both would constitute a material default by the Company or the Company Subsidiary under any Material Contract or Post-Signing Material Contracts. Except as set forth on Section 3.6(b) of the Disclosure Letter, no event has occurred which, with the passage of time or the giving of notice, or both, would constitute, and neither the execution of this Agreement nor the Closing hereunder do or will constitute or result in, a material default under or a material violation of any Material Contract or Post-Signing Material Contracts by the Company, the Company Subsidiary or any other party to such Material Contract or Post-Signing Material Contracts or would cause the acceleration of any material obligation of any party thereto or the creation of a Lien upon any Asset or any of the equity interests of the Company or the Company Subsidiary, or would require a Consent thereunder. Seller has made available to Purchaser a copy of each written Material Contract or Post-Signing Material Contracts and a materially accurate description of each oral Material Contract, and none of such Material Contracts has been modified or amended in any respect, except as reflected in Section 3.6(a) of the Disclosure Letter.

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3.7 Litigation. Except as set forth on Section 3.7 of the Disclosure Letter, there is no, and there has not been in the past three (3) years any, material Proceeding pending or, to Seller’s knowledge, threatened in writing against the Company or the Company Subsidiary or any of their respective officers, directors or Managers (in their capacity as such) or against Seller primarily in connection with the Business. Neither the Company nor the Company Subsidiary is, and in the past three (3) years has been, subject to any order, judgment, stipulation, injunction, decree or other decision resulting from a Proceeding involving the Company, Company Subsidiary or the Business (“Order”) of any Governmental Authority. Seller is not, and in the past three (3) years has not been, subject to any Order of any Governmental Authority relating primarily to the Business.

3.8 Intellectual Property Rights and Software.

(a) Section 3.8 of the Disclosure Letter sets forth, as of the Closing Date, a list of (i) all Registered IP owned by the Company or the Company Subsidiary and (ii) Products consisting of software owned by the Company or the Company Subsidiary, excluding any third party content or software incorporated in, linked to, bundled with or otherwise used in such Products.

(b) Except as set forth in Section 3.8(b) of the Disclosure Letter:

(i) all Registered IP listed in Section 3.8(a)(i) of the Disclosure Letter and owned by Company or the Company Subsidiary are currently in compliance with formal legal requirements (including, payment of filing and maintenance fees, timely post-registration filing of affidavits or use and incontestability, and renewal applications) are subsisting and unexpired and are not cancelled or abandoned and, to the knowledge of Seller, are valid and enforceable;

(ii)(A) the Company or the Company Subsidiary exclusively owns all right, title and interest in and to all Company Intellectual Property purported to be owned by the Company or the Company Subsidiary without payment to a third party, free and clear of all Liens other than Permitted Liens and (B) all Company Intellectual Property licensed to the Company or the Company Subsidiary by a third party (other than (x) off-the-shelf software or (y) generally commercially available software with annual fees or a one-time fee of less than $100,000), is the subject of a written license or other agreement and is free and clear of all Liens granted by the Company or the Company Subsidiary, other than Permitted Liens;

(iii) the conduct of the Business as currently conducted does not infringe on, misappropriate or violate (and in the past five (5) years has not infringed on, misappropriated or violated) the Intellectual Property Rights (other than any Patent) of any other Person, and, to the knowledge of the Seller, the conduct of the Business as currently conducted does not infringe on (and in the past three (3) years has not infringed) on any Patent of any other Person; for clarity, Section 3.8(b)(ii) and (iv) are the only representations and warranties in this Agreement regarding infringement of third party rights;

(iv) neither the Company nor the Company Subsidiary have, prior to the date hereof, received any written claim, and to the knowledge of Seller, there are no threatened written claims, that the Company or the Company Subsidiary have infringed on, violated or misappropriated any other Person’s Intellectual Property Rights (other than claims that have since been settled or resolved without any material ongoing obligations for the Company or the Company Subsidiary);

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(v) there are no pending or, to the knowledge of Seller, threatened claims against the Company or the Company Subsidiary alleging that any of the Company Intellectual Property owned by the Company or the Company Subsidiary is invalid or unenforceable;

(vi) to the knowledge of Seller, no other Person is infringing on, misappropriating or violating (and in the past three (3) years has infringed on, misappropriated or violated) the Intellectual Property Rights owned by the Company and the Company Subsidiary;

(vii) neither the Company nor the Company Subsidiary are party to any settlements, covenants not to sue, consents, judgments, orders or similar obligations that: (A) restrict the Company’s or the Company Subsidiary’s rights to use any Intellectual Property Rights used in the Business, or (B) restrict the Company’s or the Company Subsidiary’s Business, in order to not infringe a third party’s Intellectual Property Rights (other than, in each case of clauses (A) and (B), settlements, covenants not to sue, consents, judgments, orders or similar obligations that have since been settled or resolved without any material ongoing obligations for the Company or the Company Subsidiary);

(viii) all current employees, consultants and contractors of the Company and the Company Subsidiary who contributed to the creation or invention of any of the Company Intellectual Property purported to be owned by the Company or the Company Subsidiary did so either (i) within the scope of his or her employment such that, subject to and in accordance with applicable law, all Intellectual Property Rights arising therefrom became the exclusive property of the Company or the Company Subsidiary, as applicable, or (ii) pursuant to written agreements assigning, all Intellectual Property Rights arising therefrom to the Company or the Company Subsidiary; and no former employee, consultant or contractor has any ownership interest in any of the Company Intellectual Property purported to be owned by the Company or the Company Subsidiary; provided that for the avoidance of doubt, the foregoing does not cover any former employees, consultants and contractors that were employed or engaged by the predecessor company of the Company;

(ix) Seller, Seller Subsidiary, the Company and the Company Subsidiary have taken reasonable security measures to protect the secrecy and confidentiality of all Trade Secrets owned by the Company or the Company Subsidiary or to the knowledge of Seller, used or held for use by the Company or the Company Subsidiary in the Business;

(x)(A) except for rights, licenses or interests granted to users in the ordinary course of business under an end user license agreement or similar document (a form of which has been provided to Purchaser), neither the Company nor the Company Subsidiary has granted, directly or indirectly, any current or contingent rights, licenses or interests in or to the source code of any of the Products, and (B) other than to the Seller or its Affiliates or under confidentiality agreements entered into with third parties, neither the Company nor the Company Subsidiary have provided or disclosed the source code of such Product to any Person or entity;

(xi) the Products do not contain any “viruses”, “worms”, “time bombs”, “key-locks”, or any other devices intentionally created by Seller, Seller Subsidiary, the Company, the Company Subsidiary or any authorized vendor of Seller, Seller Subsidiary, the Company or the Company Subsidiary that could disrupt or interfere with the operation of the Products or equipment upon which the Products operate, or the integrity of the data, information or signals the Products produce in a manner adverse to the Company or the Company Subsidiary or any customer, licensee or recipient and the Company uses industry standard methods to detect and prevent viruses and any software routines designed to permit unauthorized access, to disable or erase software, hardware or data, or to perform any other similar actions (and subsequently to correct or remove such viruses) that may be present in the Products; and

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(xii)(A) none of the Products contain, incorporate, link or call to Free or Open Source Software, and (B) the incorporation, linking or calling in or by any Product of any Free or Open Source Software does not obligate the Company or the Company Subsidiary to disclose, make available, offer or deliver any portion of the source code of such Product or component thereof to any third party other than the applicable Free or Open Source Software.

3.9 IT Systems. Except as would not reasonably be expected to have a Company Material Adverse Effect or as set forth on Section 3.9 of the Disclosure Letter, the IT Systems used in the conduct of the Business are in good working order and condition and have been used and maintained substantially in accordance with industry standards and have not, as of the date hereof, suffered any material failure or disruption in the last year which has not since been remedied. To the knowledge of Seller, the IT Systems used in the conduct of the Business have the performance capabilities, processing capacity, resources, characteristics and functions needed to conduct the Business as conducted on the date hereof.

3.10 Finders; Brokers. None of Seller nor any of its Affiliates has engaged any finder, broker, agent or other intermediary who would have a claim for a fee or commission from Purchaser or any of its Affiliates, the Company or the Company Subsidiary in connection with the transactions contemplated by this Agreement and the Transaction Documents.

3.11 Tax Matters. (a) All material Tax Returns required to have been filed by or with respect to the Company or the Company Subsidiary have been timely and properly filed (taking into account any extension of time to file granted or obtained), and all such Tax Returns are true, correct and complete in all material respects; (b) all material Taxes with respect to the Company and the Company Subsidiary (whether or not shown to be due and payable on a Tax Return) have been timely paid or will be timely paid; (c) no deficiency for any material amount of Tax has been proposed, asserted or assessed by a Governmental Authority in writing against the Company or the Company Subsidiary that has not been satisfied by payment, settled or withdrawn; (d) there are no material Liens for Taxes on any Assets of the Company or the Company Subsidiary (other than liens described in clause (a) of definition of Permitted Liens); (e) no claim has ever been made by a Governmental Authority in a jurisdiction where the Company or the Company Subsidiary does not file Tax Returns that the Company or the Company Subsidiary is or may be subject to taxation by that jurisdiction; (f) all material Taxes which the Company or the Company Subsidiary was or is required to withhold or collect have been withheld and collected and have been paid over to the appropriate Governmental Authorities; (g) neither the Company nor the Company Subsidiary is a party to any material Tax sharing or Tax indemnification agreement (other than any commercial Contracts entered in the Ordinary Course of Business that do not relate primarily to Taxes but which contain only Tax sharing or Tax indemnification provisions that are customary for such Contracts); (i) for U.S. federal income tax purposes, the Company is, and has been at all times since its conversion to a limited liability company in 2007, properly treated as either a partnership or an entity that is disregarded as separate from its owner, each within the meaning of Treasury Regulations Section 301.7701-2(c); and (j) the Company has never entered into a “listed transaction” within the meaning of Treasury Regulations Section 1.6011-4(b)(2).

3.12 Employment and Benefits.

(a) Section 3.12(a) of the Disclosure Letter sets forth a list of each Company Plan.

(b) No Company Plan is subject to Title IV of ERISA and no unsatisfied liability or withdrawal liability under Title IV of ERISA has been or is expected to be incurred by Seller with respect to any ongoing, frozen or terminated “single-employer plan,” within the meaning of Section 4001(a)(15) of ERISA, or any multiemployer plan, within the meaning of Section 37(A) of ERISA, currently or formerly maintained by either the Company or the Company Subsidiary or any other entity which is considered one employer with the Company under Section 414 of the Code.

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(c) With respect to each Company Plan, Seller has provided or made available to Purchaser a current summary description thereof. As soon as practicable following the date hereof, but prior to the Closing Date, Seller will deliver or make available to Purchaser copies of all documents governing the material Company Plans, including any financing vehicles underlying the Company Plans, and a list of each material insurance policy maintained by Seller with respect to any of the Company Plans. The information set forth in Section 3.12(c) of the Disclosure Letter is true, complete and correct as of the date hereof.

(d) Each of the Company Plans has been maintained, operated and administered in material compliance with its terms and the provisions of applicable Law.

(e) There are no pending or, to the knowledge of Seller, threatened claims, litigation, or Proceedings with respect to any Company Plans.

(f) Except as provided by Law or set forth on Section 3.12(f) of the Disclosure Letter, the consummation of the transactions described in this Agreement, in and of themselves, will not accelerate the time of payment or vesting or trigger any payment or funding (through a trust or otherwise) of compensation or benefits under, or materially increase the amount payable or create any other material obligation pursuant to, any of the Company Plans.

(g) In the last three (3) years, the Company and the Company Subsidiary have: (i) been in compliance in all material respects with all applicable Laws relating to employment, termination of employment, discrimination in employment, terms and conditions of employment, wages, hours, and occupational safety and health and employment practices, and have not engaged in any unfair labor practices; and (ii) withheld all amounts required by Law to be withheld from the wages, salaries, and other payments to Company Employees, and are not liable for any arrears of wages or any Taxes (including any payments to the Income Tax Authorities and the National Insurance Institute required to be made by Law) or any penalty for failure to comply with any of the foregoing (or, if any arrears, penalty, or interest were assessed against the Company or the Company Subsidiary regarding the foregoing, it has been fully satisfied). Neither the Company nor the Company Subsidiary is liable for any payment to any trust or other fund or to any Governmental Authority with respect to unemployment compensation benefits, social security, social benefits, or other benefits or obligations for Company Employees (other than routine payments to be made in the normal course of business and consistent with past practice).

(h) To the knowledge of Seller as of the date hereof, there is no employer-employee relationship between the Company or the Company Subsidiary and the consultants engaged by any of them, said consultants are not entitled to any rights afforded solely to employees under the labor Laws of any applicable jurisdictions, including severance pay, and said consultants have received all of the rights to which they are entitled according to applicable Laws. To the knowledge of Seller as of the date hereof, any individuals employed by manpower and outplacement companies which are engaged by the Company or the Company Subsidiary for the provision of services to the Company or the Company Subsidiary are not and shall not for purposes of any applicable Law be deemed to be employees of the Company or the Company Subsidiary, as applicable.

(i) The severance pay and accrued vacation days due to the Company’s or the Company Subsidiary’s employees are fully funded or reserved in the Company’s Financial Statements (as of their respective dates) and none of Seller, the Company nor the Company Subsidiary is aware of any circumstance whereby any specific employee is likely to demand or has threatened (whether legally entitled to or not) any claim for compensation on termination of employment beyond the statutory severance pay to which such employee is entitled (if at all).

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3.13 Labor Matters. Neither the Company nor the Company Subsidiary is, or has been in the last three (3) years (a) a party to, or bound under applicable Law by, any collective bargaining agreement, (b) subject to an agreement which obligates it to bargain (exclusive of any notification and consultation obligations) with any trade or labor union on behalf of its employees or (c) to the knowledge of Seller as of the date hereof, the object of any attempt to organize employees for collective bargaining purposes or presently operating under an expired collective bargaining agreement. Neither the Company nor the Company Subsidiary is, or has ever been, a party to or subject to any charge, demand or petition or representation proceeding seeking to compel, require or demand it to bargain with any labor union or labor organization nor is there pending, or to Seller’s knowledge, threatened any material strike, dispute, walkout, work stoppage, slow-down, lockout, organizing attempt, picketing, boycott or similar activity.

3.14 Compliance with Laws. Seller, the Company and the Company Subsidiary have conducted the Business in compliance, in all material respects, with all applicable Laws. In the last three (3) years, none of Seller, the Company nor the Company Subsidiary has received any written notice or inquiry alleging any material default, breach or violation of such applicable Laws with respect to the Business. The Company and the Company Subsidiary each have all material permits, licenses, registrations, certificates, franchises, variances, exemptions, orders and other governmental authorizations, consents and approvals (collectively, “Permits”) necessary to conduct the Business as presently conducted, and they are in compliance with all material terms of each Permit. Each Permit is in full force and effect and neither the Company nor the Company Subsidiary has received any written notice or inquiry from any Governmental Authority regarding (a) any possible violation of or failure to comply with any term or requirement of such Permit or (b) any revocation, withdrawal, suspension, cancellation, termination of or material modification to any such Permit.

3.15 Environmental Matters. (a) The Company and Company Subsidiary are in material compliance with all Environmental Laws, including the possession of, and material compliance with, all Permits required under Environmental Laws; (b) there has not been any Release by the Company or Company Subsidiary of Hazardous Materials at any Real Property owned, leased or operated by the Company or Company Subsidiary that would be reasonably likely to result in any material liability to the Company or Company Subsidiary under Environmental Laws; and (c) the Company and Company Subsidiary have not received, nor are they subject to, any unresolved Environmental Claim.

3.16 Financial Statements.

(a) The statement of assets to be acquired and liabilities to be assumed as of December 31, 2008 and 2009, statements of revenue and direct expenses for the years ended December 31, 2007, 2008 and 2009, and other financial information set forth in Section 3.16(a) of the Disclosure Letter (collectively, the “Financial Statements”) (i) have been derived from Books and Records of Seller and its Affiliates, (ii) presents fairly, in all material respects, the assets to be acquired and liabilities to be assumed and the revenue and direct expenses of the Company and the Company Subsidiary at the dates and for the periods indicated in the applicable Financial Statements and (iii) have been prepared in accordance with the principles, procedures and assumptions set forth in the Financial Statements and otherwise in accordance with GAAP, in each case consistently applied except as otherwise expressly noted therein.

(b) Neither the Company nor the Company Subsidiary has any Liabilities of a nature required to be reflected on a balance sheet prepared in accordance with GAAP or in the notes thereto, other than (i) to the extent and for the amount reflected as a Liability on the Financial Statements, (ii)

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Liabilities incurred since December 31, 2009 by the Company and the Company Subsidiary in the ordinary course of business consistent with past practice and (iii) Liabilities incurred in connection with the Transaction Documents and the transactions contemplated hereby.

(c) Neither the Company nor the Company Subsidiary has any Indebtedness other than (i) the Guarantee, dated as of December 9, 2009, made by the subsidiaries of Seller in favor of Bank of America, N.A., as administrative agent for the lenders party to that certain Credit Agreement dated as of December 9, 2009, among Seller, such lenders and such administrative agent (the “Guarantee Agreement”), (ii) the Security Agreement, dated as of December 9, 2009, by Seller, the Company, the Company Subsidiary and other subsidiary guarantors thereto, and Bank of America, N.A. (the “Security Agreement”) and (iii) the Patent Security Agreement, dated as of December 9, 2009, by Seller, the Company, Bank of America, N.A. and the other parties thereto (the “Patent Security Agreement”).

3.17 Absence of Changes. Except as otherwise expressly required by this Agreement or as set forth in Section 3.17 of the Disclosure Letter, since December 31, 2009 through the date hereof, Seller, Seller Subsidiary, the Company and the Company Subsidiary have conducted the Business in the ordinary course of business consistent with past practice and there has not occurred:

(a) any material increase in compensation or other remuneration payable or committed to be paid to director, officer, or employee of the Company or the Company Subsidiary, or in any benefits granted under any Company Plan with or for the benefit of any such director, officer or employee;

(b) other than in the ordinary course of business consistent with past practice, any material modification or material amendment of any Material Contract or any material modification or termination of any Permit;

(c) any acquisition of or investment in (by merger, exchange, consolidation, purchase or otherwise) any corporation or partnership or equity interest in any Person;

(d) other than in the ordinary course of business consistent with past practice, any acquisition of any material Assets of the Company or the Company Subsidiary, or otherwise used in the Business, whether through capital spending or otherwise;

(e) other than in the ordinary course of business consistent with past practice, (i) any transfer, sale, lease, license or other disposal of, or subjecting to any Lien, any material Assets of the Company or the Company Subsidiary or (ii) any deactivation of any material products or services (or any material features thereof) of the Company or the Company Subsidiary that had previously been exploited commercially;

(f) any written or, to Seller’s knowledge, oral waiver by the Company or the Company Subsidiary of any claims or rights that involve amounts individually or in the aggregate in excess of $100,000;

(g) any material change in the Company’s or the Company Subsidiary’s respective practices with respect to the timing of the payment of accounts payable or in the collection of notes or accounts receivable in advance of or beyond the dates when the same would have been collected, other than in the ordinary course of business consistent with past practice;

(h) any material change in that method of accounting or accounting policies of the Company or the Company Subsidiary (including any changes in any estimates used in implementing such method and policies), other than those required by GAAP, or any material write-down in the accounts receivable or inventories of the Company or the Company Subsidiary;

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(i)(i) any material change in Tax elections, (ii) any material amendment of any Tax Return relating to the Company or the Company Subsidiary, (iii) any material settlement or compromise with respect to any Tax controversy, Tax claim, audit or assessment, (iv) any material closing agreement with respect to any Tax, (v) any consent to any extension or waiver of the limitations period applicable to any material Tax claim or assessment, in the case of each of (i)-(v) above, other than in the ordinary course of business consistent with past practice;

(j) any dividend or distribution by the Company or the Company Subsidiary;

(k) any abandonment, expiration, cancellation or lapse of material Intellectual Property Rights owned by the Company or the Company Subsidiary or any grant of a license, release or covenant not to sue with respect to any Company Intellectual Property Rights other than non-exclusive licenses granted in the ordinary course of business consistent with past practice, provided, that with respect to the Trademarks and domain names contributed to Company by Seller Subsidiary pursuant to that certain Contribution Agreement dated April 22, 2010 and listed in Exhibits A and B to such Contribution Agreement, the foregoing obligation shall continue on a Trademark-by-Trademark and domain name-by-domain name basis until such time as (i) the assignment of such Trademarks to the Company has been duly recorded with the applicable U.S. Patent and Trademark Office and all similar offices and agencies anywhere in the world and (ii) the domain name registration records have been updated by the applicable registrars to reflect the Company as the owner of such domain names; and

(l) any binding commitment or agreement by the Company or the Company Subsidiary to do any of the foregoing.

3.18 Assets. As of the Closing, the Owned Assets, together with (a) all Assets leased to the Company or the Company Subsidiary (collectively, the “Leased Assets”), (b) any and all Intellectual Property Rights and other Assets licensed to the Company or the Company Subsidiary (collectively, the “Licensed Assets”), (c) the rights or other benefits set forth in or contemplated by the Transition Services Agreement, the Professional Services Agreement and the License Agreement, (d) the rights or other benefits under Contracts of Seller and its Affiliates (other than the Company and the Company Subsidiary) under which the Company or the Company Subsidiary receives goods or services prior to Closing and set forth on Section 5.10 to the Disclosure Letter (such rights and other benefits, collectively, the “Retained Benefits”) and (e) services provided by Seller or any of its Affiliates (other than the Company and the Company Subsidiary) to the Company and the Company Subsidiary as set forth on Section 3.18(e) of the Disclosure Letter (such services, collectively, the “Retained Services”), will constitute all of the assets, properties, services and rights necessary for the conduct of the Business in substantially the same manner as presently conducted, subject to the terms thereof (including that the Transaction Documents contemplate changes in the manner in which the Business is currently operated). None of the Patents (as defined in the Distribution Agreement) distributed by the Company to the Seller Subsidiary pursuant to the Distribution Agreement dated April 22, 2010 (the “Distribution Agreement”) are necessary to the operation of the Business as currently conducted. The Company and the Company Subsidiary have (i) good and marketable title to all Assets reflected as being owned by them on the latest balance sheet included in the Financial Statements (subject to changes in the ordinary course of business since the date of the Financial Statements) (collectively, the “Owned Assets”), (ii) a valid leasehold interest in all of the Leased Assets and (iii) a valid license right to use all of the Licensed Assets, in each case free and clear of all Liens other than Permitted Liens or Liens contemplated by Contracts relating thereto. Upon and immediately following the Closing, each of the Company and the Company Subsidiary will continue to be vested with good and marketable title to the Owned Assets, a valid leasehold interest

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the Leased Assets and license right interest in the Licensed Assets, in each case free and clear of all Liens other than Permitted Lien or Liens contemplated by Contracts relating thereto. All of the tangible Owned Assets and Leased Assets have been maintained in accordance with normal industry practice and are in good operating condition and repair (subject to normal wear and tear). Purchaser hereby acknowledges and agrees that the Retained Benefits and the Retained Services will be retained by Seller and will not be transferred or otherwise made available to Purchaser, the Company or the Company Subsidiary in connection with the transactions contemplated by this Agreement, except as specifically set forth in the Transaction Documents.

3.19 Insurance. Set forth on Section 3.19(a) of the Disclosure Letter is a true, correct and complete list of material insurance policies currently in force covering or relating to the properties, operations or personnel maintained by the Company or the Company Subsidiary. Section 3.19(b) of the Disclosure Letter sets forth a true, correct and complete list of all insurance claims relating primarily to the Business or the Company and the Company Subsidiary currently pending and in the last three (3) years.

3.20 Related Party Transactions. Except as set forth in Section 3.20 of the Disclosure Letter, neither the Company nor the Company Subsidiary is a party to any Contract or transaction with Seller or any of its Subsidiaries (other than the Company and the Company Subsidiary) or to Seller’s knowledge with any of the officers or directors of Seller entered into in their capacities as such, other than indemnification rights and similar ordinary course arrangements relating thereto.

3.21 Bank Accounts. Set forth on Section 3.21 of the Disclosure Letter is a list as of the date hereof of the locations and numbers of all bank accounts, investment accounts and safe deposit boxes maintained by the Company and the Company Subsidiary, together with the names of all Persons who are authorized signatories or have access thereto or control thereunder on such account.

3.22 Grants. Set forth on Section 3.22 of the Disclosure Letter is complete list, as of the date hereof, of all pending and outstanding grants, incentives and subsidies, and applications therefor (collectively, “Grants”) from the government of the State of Israel or the United States or any agency thereof, or from any foreign governmental or administrative agency, granted to the Company or the Company Subsidiary, including, directly or indirectly, from the Office of the Chief Scientist of the State of Israel and the Israeli Investment Center. Purchaser has received true, correct and complete copies of all application documents for Grants submitted by the Company and the Company Subsidiary and of all letters of approval, and supplements thereto, granted to the Company. Each of the Company and the Company Subsidiary is in compliance, in all material respects, with the terms and conditions of the Grants and has duly fulfilled, in all material respects, all the undertakings relating thereto. Seller is not aware of any event or other set of circumstances which might lead to the revocation or material modification of any of the Grants.

3.23 Privacy.

(a) The Company and the Company Subsidiary have complied and do comply, in all material respects, with all applicable Laws and contractual obligations applicable to the collection, use and disclosure of Personal Data, including the Safe Harbors certifications relating to the Company and/or the Company Subsidiary.

(b) The Company and the Company Subsidiary have reasonable security measures in place to protect all Personal Data under their control and/or protect such Personal Data from unauthorized access by any third parties. None of Seller, the Company and the Company Subsidiary has suffered any breach in security that has permitted any unauthorized access to the Personal Data under their control in the last three (3) years.

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(c) The Company and the Company Subsidiary have caused vendors to which they provide Personal Data and/or access thereto to enter into Contracts to protect such Personal Data from unauthorized access and/or unauthorized disclosure.

3.24 No Other Representations or Warranties. Except for the representations and warranties contained in this ARTICLE III (as modified by the Disclosure Letter) and the other Transaction Documents, neither Seller, the Company, any of their respective Subsidiaries nor any other Person makes any other express, implied or statutory representation or warranty with respect to the Securities, the Company or the Company Subsidiary, the Business or the transactions contemplated by this Agreement. Without limiting the generality of the foregoing, except for the representations and warranties contained in ARTICLE III hereof (as modified by the Disclosure Letter) and in the other Transaction Documents, Seller hereby disclaims all liability and responsibility for any other representation or warranty, projection, forecast, statement, or information made, communicated or furnished (orally or in writing) to Purchaser or its Affiliates or their representatives.

ARTICLE IV

REPRESENTATIONS OF PURCHASER

Purchaser represents and warrants to Seller as follows:

4.1 Corporate Existence. Purchaser is duly organized, validly existing and in good standing under the laws of British Virgin Islands and has the requisite power and authority to execute and deliver this Agreement and the other Transaction Documents to which it is a party and to perform its obligations hereunder and thereunder.

4.2 Corporate Authority.

(a) This Agreement and the other Transaction Documents to which Purchaser is a party and the consummation of the transactions contemplated hereby and thereby involving Purchaser have been duly authorized by Purchaser by all requisite corporate, partnership or other action. Purchaser has full power and authority to execute and deliver the Transaction Documents to which it is a party and to perform its obligations thereunder. This Agreement has been duly executed and delivered by Purchaser, and the other Transaction Documents will be duly executed and delivered by Purchaser, and this Agreement constitutes, and the other Transaction Documents when so executed and delivered will constitute, a valid and legally binding obligation of Purchaser, enforceable against it in accordance with its terms except as enforceability may be affected by bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and other similar Laws relating to or affecting creditors’ rights generally, general equitable principles (whether considered in a proceeding in equity or at law) and the implied covenant of good faith and fair dealing.

(b) Except for the required filings under the applicable Antitrust Regulations, the execution and delivery of this Agreement and the other Transaction Documents by Purchaser, the performance by Purchaser of its obligations hereunder and thereunder and the consummation by Purchaser of the transactions contemplated hereby and thereby do not and will not (i) violate or conflict with any provision of the respective certificate of incorporation or by-laws or similar organizational documents of Purchaser, (ii) result in any violation or breach or constitute any default (with or without notice or lapse of time, or both) under, or give rise to a right of termination, cancellation or acceleration of any obligation or a loss of a benefit under, or result in the creation of any Lien under, in any material

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respect, any Contract of Purchaser or by which any of its assets or properties are bound, or (iii) violate, conflict with or result in any breach under any provision of any Law applicable to Purchaser or any of its assets.

4.3 Governmental Approvals and Consents. Purchaser is not subject to any order, judgment, decree, stipulation, injunction or agreement with any Governmental Authority that would prevent or materially interfere with or delay the consummation of the transactions contemplated hereby or would be reasonably likely to have a Purchaser Material Adverse Effect. Except for any requirements under any Antitrust Regulations, no consent, approval, order or authorization of, license or permit from, notice to or registration, declaration or filing with, any Governmental Authority, is required on the part of Purchaser in connection with the execution, delivery or performance of this Agreement or any of the other Transaction Documents or the consummation of the transactions contemplated hereby and thereby except for such consents, approvals, orders or authorizations of, licenses or permits, filings or notices that have been obtained and remain in full force and effect and those with respect to which the failure to have obtained or to remain in full force and effect would not have a Purchaser Material Adverse Effect.

4.4 Finders; Brokers. None of Purchaser nor any of its Affiliates has engaged any finder, broker, agent or other intermediary who would have a claim for a fee or commission from Seller or any of its Affiliates in connection with the transactions contemplated by this Agreement and the Transaction Documents.

4.5 Financial Capacity. Purchaser (i) has, and at the Closing will have, sufficient internal funds (without giving effect to any unfunded financing regardless of whether any such financing is committed) available to pay the Purchase Price and any expenses incurred by Purchaser in connection with the transactions contemplated by this Agreement, (ii) has, and at the Closing will have, the resources and capabilities (financial or otherwise) to perform its obligations hereunder, and (iii) has not incurred any obligation, commitment, restriction or Liability of any kind, which would impair or adversely affect such resources and capabilities.

4.6 Solvency. Purchaser (and, for the avoidance of doubt, any permitted assignee, if applicable) is not entering into the transactions contemplated hereby with the intent to hinder, delay or defraud either present or future creditors. Immediately after giving effect to all of the transactions contemplated hereby, the payment of the Purchase Price and payment of all related fees and expenses, assuming satisfaction of the conditions to Purchaser’s obligation to consummate the transactions as set forth or contemplated herein, or the waiver of such conditions, Purchaser (and, for the avoidance of doubt, any permitted assignee, if applicable) will be Solvent (as defined below). For purposes of this Section 4.6, the term “Solvent” with respect to a Person means that, as of any date of determination, (a) the amount of the fair saleable value of the assets of such Person and its Subsidiaries, taken as a whole, exceeds, as of such date, the sum of (i) the value of all liabilities of such Person and its Subsidiaries, taken as a whole, including contingent and other liabilities, as of such date, as such quoted terms are generally determined in accordance with the applicable federal and foreign Laws governing determinations of the solvency of debtors, and (ii) without duplication of liabilities in clause (i), the amount that will be required to pay the probable liabilities of such Person and its Subsidiaries, taken as a whole on its existing debts (including contingent liabilities) as such debts become absolute and matured and (b) such Person shall have satisfied any other solvency requirements pursuant to applicable state, federal or foreign Laws.

4.7 Litigation. Purchaser is not subject to any order, judgment, stipulation, injunction, decree or agreement with any Governmental Authority that would prevent or materially interfere with or delay the consummation of the transactions contemplated by the Transaction Documents. No Proceeding is pending or, to the knowledge of Purchaser, threatened against Purchaser, which would prevent or materially interfere with or delay the consummation of the transactions contemplated hereby.

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4.8 Accredited Investor. Purchaser is an “Accredited Investor” as such term is defined in Rule 501(a) of Regulation D under the Securities Act, as in effect as of the date of Closing.

4.9 Investment Purpose. Purchaser is acquiring the Securities solely for the purpose of investment and not with a view to, or for offer or sale in connection with, any distribution thereof other than in compliance with all applicable laws, including United States federal securities laws. Purchaser acknowledges that the Securities have not been registered under the Securities Act or any state securities laws and agrees that the Securities may not be sold, transferred, offered for sale, pledged, hypothecated or otherwise disposed of without registration under the Securities Act and any applicable state securities laws, except pursuant to an exemption from such registration under the Securities Act and such laws. Purchaser is able to bear the economic risk of holding the Securities for an indefinite period (including total loss of its investment), and (either alone or together with its advisors) has sufficient knowledge and experience in financial and business matters so as to be capable of evaluating the merits and risk of their investment; provided, however, that the foregoing shall not affect the right of any Purchaser Indemnified Party under Section 7.1(a).

4.10 No Other Representations or Warranties. Except for the representations and warranties contained in this ARTICLE IV and the other Transaction Documents, neither Purchaser nor any other Person makes any other express, implied or statutory representation or warranty on behalf of Purchaser or any of its Affiliates or representatives. Without limiting the generality of the foregoing, except for the representations and warranties contained in ARTICLE IV hereof and in the other Transaction Documents, Purchaser hereby disclaims all liability and responsibility for any other representation or warranty, projection, forecast, statement, or information made, communicated or furnished (orally or in writing) to Seller or its Affiliates or their representatives.

ARTICLE V

AGREEMENTS OF PURCHASER AND SELLER

5.1 Operation of the Business. Except as otherwise contemplated by this Agreement or as disclosed in Section 5.1 of the Disclosure Letter, Seller covenants that until the Closing it will cause the Company and the Company Subsidiary to use commercially reasonable efforts to maintain and preserve intact the Business in all material respects. Except as disclosed in Section 5.1 of the Disclosure Letter or as required by Law, or with the prior written approval of Purchaser (which approval shall not be unreasonably withheld, conditioned or delayed), from the date hereof until the Closing, Seller shall cause the Company and the Company Subsidiary to continue to operate the Business in all material respects in the ordinary course of business consistent with past practice. Except as expressly contemplated by the Transaction Documents, prior to the Closing Seller shall not take actions in connection with its instant messaging businesses which are intended to adversely affect the Business to a material degree in relation to Seller’s other instant messaging businesses. Except as disclosed in Section 5.1 of the Disclosure Letter or as required by Law, without limiting the generality of the foregoing, until the Closing Seller shall not, and shall cause the Company and the Company Subsidiary not to, without the prior written approval of Purchaser (which approval shall not be unreasonably withheld, conditioned or delayed), take any of the following actions:

(a)(i) transfer, sell, lease, license or otherwise convey or dispose of, or subject to any Lien other than Permitted Liens, any Assets of the Company or the Company Subsidiary, or otherwise used primarily in the Business having value in excess of $25,000 individually or $100,000 in the aggregate or (ii) deactivation of any material products or services (or any material features thereof) of the Company or the Company Subsidiary that had previously been exploited commercially;

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(b)(i) grant any increase in the compensation of employees of the Company or the Company Subsidiary, except for increases in the compensation of such employees: (A) in the ordinary course of business, including in connection with promotions and on the basis of merit, or (B) as required by applicable Law or by any Company Plan or (ii) hire new employees of the Company or the Company Subsidiary with annual compensation greater than $75,000 individually or $150,000 in the aggregate;

(c) cancel, compromise, release or assign any indebtedness owed to the Company or the Company Subsidiary or any claims held by the Company or the Company Subsidiary, except for inter-company accounts or indebtedness or in the ordinary course of business consistent with past practice;

(d) terminate (other than by expiration) or amend or modify (other than by automatic extension or renewal if deemed an amendment or modification of any such contract) any Material Contract, Post-Signing Material Contract or Permit of the Company or the Company Subsidiary, except in the ordinary course of business consistent with past practice;

(e) amend the Certificate of Formation, the Limited Liability Company Agreement or other comparable charter or organizational documents of the Company or the Company Subsidiary, as applicable;

(f) make any capital expenditures or other expenditures with respect to property, plant or equipment in excess of $100,000 in the aggregate for the Company and the Company Subsidiary, other than in the ordinary course of business consistent with past practice;

(g) make any material changes in accounting methods, principles or practices of the Company or the Company Subsidiary, except insofar as may be required by any changes in GAAP;

(h) with respect to the Company and the Company Subsidiary, make or change any material election in respect of Taxes, adopt or change any accounting method in respect of Taxes, file any amendment to a material Tax Return or claim for refund, settle or consent to any material claim or assessment in respect of Taxes, enter into any closing agreement in respect of Taxes, or consent to any extension or waiver of the limitation period applicable to any material claim or assessment in respect of Taxes;

(i) issue or sell any limited liability company interests, capital stock or other securities of the Company or the Company Subsidiary;

(j) with respect to the Company and the Company Subsidiary, pay any dividend or other distribution on equity;

(k) settle any Proceeding before any Governmental Authority to which the Company or the Company Subsidiary is a party or which relates primarily to the Business;

(l) other than in the ordinary course of business consistent with past practice, enter into a Contract that would have been a Material Contract of the Company or the Company Subsidiary under clauses (ii), (viii), (ix), (x) (xii) and (xiii) of Section 3.6(a);

(m) with respect to the Company and the Company Subsidiary, make any acquisition of or investment in (by merger, exchange, consolidation, purchase or otherwise) any corporation or partnership or equity interest in any Person;

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(n) other than in the ordinary course of business consistent with past practice, abandon or permit the lapse of material Intellectual Property Rights owned by the Company or the Company Subsidiary or grant any license, release or covenant not to sue with respect to any Company Intellectual Property Rights;

(o) any material change in the Company’s or the Company Subsidiary’s respective practices with respect to the timing of the payment of accounts payable or in the collection of notes or accounts receivable in advance of or beyond the dates when the same would have been collected; or

(p) enter into any Contract providing for any of the foregoing.

Purchaser acknowledges and agrees that: (i) nothing contained in this Agreement shall give Purchaser, directly or indirectly, the right to control or direct the Company and the Company Subsidiary’s operations prior to the Closing, (ii) prior to the Closing, Seller shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over the Company and the Company Subsidiary’s operations, and (iii) notwithstanding anything to the contrary set forth in this Agreement, no consent of Purchaser shall be required with respect to any matter set forth in Section 5.1 or elsewhere in this Agreement to the extent the requirement of such consent would, upon advice of counsel, violate applicable anti-trust law.

5.2 Investigation of Business; Confidentiality.

(a) Subject to limitations imposed under applicable Law, until the Closing, Seller shall cause the Company and the Company Subsidiary to permit Purchaser and its authorized agents or representatives to have reasonable access to the properties, books, records (including access to information in the electronic data room (but excluding any information relating to Seller)) and the Company Employees at reasonable hours to review information and documentation and ask questions relative to the properties, books, contracts, commitments and other records of the Business; provided, that any such investigation shall only be upon reasonable notice and shall not unreasonably interfere with or disrupt the personnel and operations of Seller and its Subsidiaries, shall comply with the reasonable security and insurance requirements of Seller and its Subsidiaries, shall not include any invasive or destructive environmental testing or sampling and shall be at Purchaser’s sole risk and expense. Notwithstanding the foregoing, Seller and its Subsidiaries shall have no obligation to disclose any information (i) to the extent the disclosure of which is subject to a confidentiality obligation in favor of any third party or (ii) where such access or disclosure would waive attorney-client privilege of Seller or its Subsidiaries or contravene any Law or binding agreement. The relevant parties shall attempt in good faith to make appropriate substitute disclosure arrangements under the circumstances in which the restrictions of the preceding sentence apply. All requests for access to the offices, properties, Books and Records of Seller and its Subsidiaries shall be made to such representatives of Seller or its Subsidiaries as Seller shall designate, who shall be solely responsible for coordinating all such requests and all access permitted hereunder. It is further agreed that neither Purchaser nor any of its Affiliates, agents or representatives shall contact any of the employees, customers (including dealers and distributors), suppliers, joint venture partners or other Subsidiaries or Affiliates of Seller in connection with the transactions contemplated hereby, whether in person or by telephone, electronic or other mail or other means of communication, without the specific prior authorization of such representatives of Seller; provided, however, Seller shall be deemed to have consented in the case of the counterparties to the contracts listed in Section 5.10 of the Seller Disclosure Schedule, and shall provide reasonable assistance to Purchaser to make initial contact with such counterparties, in connection with Purchaser’s procuring the licenses and other Contracts in Section 5.10 of the Disclosure Letter. Notwithstanding the foregoing, Seller shall provide to Purchaser a copy of the index to and (excluding any information relating to Seller) the information contained in the electronic data room promptly following the Closing Date (but, in any event, within thirty (30) days following the Closing Date).

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(b) The Parties expressly acknowledge and agree that this Agreement and its terms and all information, whether written or oral, furnished by either Party to the other Party or any Affiliate of such other Party in connection with the negotiation of this Agreement (“Confidential Information”) shall be treated as confidential information by the Parties and their Affiliates and shall not be disclosed to any other Person for a period of three (3) years after the date hereof without the prior written consent of the other Party, except as may be required by applicable Law or by order of an applicable Governmental Authority; provided, that this Section 5.2(b) imposes no obligation on either Party with respect to information that (i) was in the receiving Party’s possession before receipt from the disclosing Party; (ii) is or becomes a matter of public knowledge through no fault of the receiving Party; (iii) is rightfully received by the receiving Party from a third party without a duty of confidentiality; (iv) is independently developed by a representative of the receiving Party who have not had access to such information; or (v) is disclosed by the receiving Party with the written permission of the disclosing Party.

5.3 Necessary Efforts; No Inconsistent Action.

(a) Subject to Section 5.3(b) and the other terms and conditions of this Agreement, Seller and Purchaser agree (and shall cause each of its respective Affiliates) to use reasonable best efforts to take, or cause to be taken, all actions and to do, or cause to be done and to cooperate with the other Party in doing, all things necessary, proper or advisable to consummate and make effective the transactions contemplated by the Transaction Documents as soon as practicable and to cause the conditions to each Party’s obligation to close the transactions contemplated hereby as set forth in ARTICLE VI to be satisfied, including, without limitation, all actions necessary to (i) obtain all licenses, certificates, permits, approvals, clearances, expirations, waivers or terminations of applicable waiting periods, authorizations, qualifications and orders (each a “Consent”) of any Governmental Authority required for the satisfaction of the conditions set forth in Section 6.1(b), (ii) obtain all other Consents (it being understood that the failure to obtain any such Consents contemplated by this clause (ii) shall not cause the condition set forth in Section 6.3(b) to be deemed not to be satisfied and it being further understood that neither Seller nor any of its Subsidiaries shall be required to expend any money or agree to any restrictions in order to obtain any Consents) necessary in connection with the consummation of the transactions contemplated by the Transaction Documents, (iii) defend any suits, claims, actions, investigations or proceedings, whether judicial or administrative, challenging this Agreement or the consummation of the transactions contemplated by the Transaction Documents to which it is a party, including seeking to have any stay or temporary restraining order entered by any court or other Governmental Authority vacated or reversed, and (iv) execute or deliver any instruments or documents specified in this Agreement or any additional instruments necessary to consummate the transactions contemplated by the Transaction Documents, and to carry out fully the purposes of, this Agreement; provided, however, that in no event shall Seller or any of its Subsidiaries be required or expected to retain the Company or the Company Subsidiary or their respective assets or liabilities in order to comply with its obligations in respect of the foregoing. The Parties shall cooperate fully with each other to the extent necessary and permitted by applicable Law in connection with the foregoing.

(b) Purchaser and Seller shall timely and promptly make all filings which may be required for the satisfaction of the conditions set forth in Section 6.1(b) by each of them in connection with the consummation of the transactions contemplated hereby. In furtherance and not in limitation of the foregoing, each of Seller and Purchaser shall, in each case to the extent such filing is required or advisable, make all filings or notifications under any applicable Antitrust Regulation as promptly as practicable following the date of this Agreement and in any event no later than thirty (30) Business Days following the date of this Agreement.

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(c) Notwithstanding anything in this Agreement to the contrary, Purchaser agrees (and Seller agrees except with respect to clause (B) of this sentence), and shall cause each of its Subsidiaries, to take any and all actions necessary to obtain any Consents required under or in connection with any Antitrust Regulation, and to enable all waiting periods under any Antitrust Regulation to expire or to be terminated, and to avoid or eliminate each and every impediment under any Antitrust Regulation asserted by any Governmental Authority, in each case, to cause the transactions contemplated hereby to occur prior to the Outer Date, including but not limited to (A) promptly complying with or modifying any requests for additional information (including any second request) by any Governmental Authority, (B) if necessary to obtain clearance by any Governmental Authority before the Outer Date, offering, negotiating, committing to and effecting, by consent decree, hold separate order or otherwise, the sale, divestiture, license or other disposition of any and all of the capital stock, assets, rights, products or businesses of Purchaser and its Subsidiaries (including all or any portion of the Business) and any other restrictions on the activities of Purchaser and its Subsidiaries (unless such sale, divestiture, license, disposition or other restrictions, individually or in the aggregate, would be reasonably expected to have a material adverse effect on the business, operation, assets, liabilities, earnings, condition (financial or otherwise) or results of operations of Purchaser or the Company and the Company Subsidiary, taken as a whole, or the Business) and (C) contesting, defending and appealing any threatened or pending preliminary or permanent injunction or other order, decree or ruling or statute, rule, regulation or executive order that would adversely affect the ability of any Party hereto to consummate the transactions contemplated hereby and taking any and all other actions to prevent the entry, enactment or promulgation thereof.

(d) Subject to applicable Law and except as prohibited by any representative of any applicable Governmental Authority, each of Purchaser and Seller, acting through outside counsel, agree to coordinate and cooperate fully and promptly with each other in exchanging information and providing assistance as the other Party may reasonably request in connection with any filing, submission, investigation or other inquiry related to the transactions contemplated herein; provided, however, that neither Party shall be obligated to disclose any confidential information not related to the Business and each Party shall have the option to limit access to such documents to the other Party’s attorneys should the Party deem the information contained on such documents to be highly sensitive information. Each of Purchaser and Seller shall (i) use its reasonable best efforts to respond as reasonably practicable to any inquiries received from, and requests for additional information and documentary material by, any Governmental Authority, (ii) promptly notify the other Party of any written or oral communication to that Party from any Governmental Authority, and of any material communication received or given in connection with any proceeding by a private party, in each case regarding any of the transactions contemplated hereby, (iii) provide to the other Party, and permit the other Party to review and comment in advance of submission, all proposed correspondence, filings, and written communications with any Governmental Authority with respect to this Agreement and the transactions contemplated thereby, (iv) not participate in any substantive meeting or discussion with any Governmental Authority in respect of any filings, investigation or inquiry concerning this Agreement and the transactions contemplated hereby unless it consults with the other Party in advance and, except as prohibited by applicable Law or Governmental Authority, gives the other Party the opportunity to attend and participate thereat, and (v) in the event one Party is prohibited by applicable Law or Governmental Authority from participating in or attending any meetings or conferences, keep the other promptly and reasonably apprised with respect thereto. Without in any way limiting the foregoing, the Parties will consult and cooperate with one another, and consider in good faith the views of one another, in connection with any analyses, appearances, presentations, memoranda, briefs, arguments, opinions and proposals made or submitted by or on behalf of any Party in connection with proceedings under or relating to the any Antitrust Regulation, except as may be prohibited or restricted by Law.

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(e) Each of Purchaser and Seller shall promptly notify and keep the other advised as to (i) any material communication from or with or any Governmental Authority regarding any of the transactions contemplated hereby, (ii) any litigation or administrative proceeding pending and known to such Party, or to its knowledge threatened, which challenges, or would challenge, the transactions contemplated hereby and (iii) any event or circumstance which, to its knowledge, would constitute a breach of its respective representations and warranties in this Agreement such that a closing condition would not be satisfied. Subject to the provisions of ARTICLE VIII hereof, Seller and Purchaser shall not take any action inconsistent with their obligations under this Agreement or that would materially hinder or delay the consummation of the transactions contemplated by this Agreement.

5.4 Public Disclosures. Unless otherwise required by Law or the rules and regulations of any stock exchange or quotation services on which such Party’s (or such Party’s parent’s) stock is traded or quoted, prior to the Closing Date, no news release or other public announcement pertaining to the transactions contemplated by this Agreement will be made by or on behalf of any Party or its Affiliates without the prior approval of the other Party. If in the judgment of either Party such a news release or public announcement is required by Law or the rules or regulations of any stock exchange on which such Party’s (or such Party’s parent’s) stock is traded, the Party intending to make such release or announcement shall provide prior written notice to the other Party of the contents of such release or announcement and shall consult with the other Party with respect thereto and consider all reasonable comments of the other Party relating to such disclosure. In connection with the execution of this Agreement the Parties shall consult each other with respect to a news release announcing the transactions contemplated by this Agreement, which shall be subject to the consent of the other Party which consent shall not be unreasonably withheld.

5.5 Access to Records and Personnel.

(a) Exchange of Information. Following the Closing, each Party agrees to provide, or cause to be provided, to each other, as soon as reasonably practicable after written request therefor and at the requesting Party’s sole expense, reasonable access, during normal business hours and in a non-disruptive manner, to the other Party’s employees and to any books, records, documents, files and correspondence relating to the Business in the possession or under the control of the other Party that is necessary for the requesting Party to (i) comply with reporting, disclosure, filing or other requirements imposed on the requesting Party (including under applicable securities Laws) by a Governmental Authority having jurisdiction over the requesting Party, (ii) use in any other judicial, regulatory, administrative or other Proceeding or in order to satisfy Tax, audit, accounting, claims, regulatory, litigation or other similar requirements or (iii) comply with its obligation under this Agreement; provided, however, that in the event that any Party determines that any such provision of information could be commercially detrimental, violate any Law or agreement, or waive any attorney-client, or other similar privilege, the Parties shall take all reasonable measures to permit, to the extent reasonably practicable, the compliance with such obligations in a manner that avoids any such harm or consequence.

(b) Financial and Other Information. After the Closing, each Party shall provide, or cause to be provided, to the other Party at the requesting Party’s expense such financial and other data and information relating to the Business reasonably available and in its possession (in such form as is reasonably available to it) as is reasonably requested by the other Party and necessary in order for such other Party to prepare its financial statements and reports or filings, including Tax Returns, with any Governmental Authority; provided, however, that the provisions of this Section 5.5(b) shall in no way obligate either Party or any of its Subsidiaries to prepare any financial statements or information.

(c) Ownership of Information. Any information owned by a Party that is provided to a requesting Party pursuant to this Section 5.5 shall be deemed confidential information of, and to remain the property of, the providing Party. Unless specifically set forth herein, nothing contained in this Agreement shall be construed as granting or conferring rights of license or otherwise in any such information.

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(d) Record Retention. Except as otherwise provided herein, each Party agrees to use its commercially reasonable efforts to retain the books, records, documents, instruments, accounts, correspondence, writings, evidences of title and other papers relating to the Business (the “Books and Records”) in their respective possession or control for a period of six (6) years following the Closing Date or for such longer period as may be required by Law or until the expiration of the relevant representation or warranty under any of the Transaction Documents and any related claim of indemnification related thereto.

(e) Limitation of Liability. No Party shall have any liability to any other Party in the event that any information exchanged or provided pursuant to this Section 5.5 is found to be inaccurate. No Party shall have any liability to any other Party if any information is destroyed or lost after commercially reasonable efforts by such Party to comply with the provisions of Section 5.5(d).

(f) Other Agreements Providing For Exchange of Information. The rights and obligations granted under this Section 5.5 are subject to any specific limitations, qualifications or additional provisions on the sharing, exchange or confidential treatment of information set forth in this Agreement and the Confidentiality Agreement.

(g) Production of Witnesses; Records; Cooperation. In the case of a legal or other Proceeding (including a claim for indemnification) between the Parties or between one Party and a third party or Governmental Authority relating to the Company or the Company Subsidiary, this Agreement (including any matters subject to indemnification hereunder) or the transactions contemplated hereby, or any other Transaction Documents or the transactions contemplated thereby, each Party shall use its commercially reasonable efforts to make available to the other Party, upon written request, the former (to the extent practicable), current (to the extent practicable) and future officers, employees, other personnel and agents of such Party as witnesses and any books, records or other documents within its control or which it otherwise has the ability to make available (other than materials covered by the attorney-client privilege), to the extent that any such Person (giving consideration to business demands of such officers, employees, other personnel and agents) or books, records or other documents may reasonably be required in connection with any legal, administrative or other Proceeding in which the requesting Party may from time to time be involved, regardless of whether such legal, administrative or other Proceeding is a matter with respect to which indemnification may be sought hereunder. The requesting Party shall bear all out-of-pocket costs and expenses in connection with the foregoing.

(h) Confidential Information. Nothing in this Section 5.5 shall require either Party to violate any agreement with any third parties regarding the confidentiality of confidential and proprietary information; provided, however, that in the event that either Party is required under this Section 5.5 to disclose any such information, that Party shall use all commercially reasonable efforts to seek to obtain such third party’s consent to the disclosure of such information but in no event shall such Party be required to make a payment or other financial accommodation to obtain such consent.

5.6 Employee Benefits.

(a) During the period from the Closing Date until the first anniversary thereof, Purchaser shall cause the Company or the Company Subsidiary or any other Affiliate of Purchaser employing a Company Employee to, provide (i) each Company Employee (while they continue to be employed by Purchaser or any of its Affiliates) base salary, wages, or commission rates (as applicable),

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and annual incentive compensation opportunities that are at least at the same level as in effect with respect to such Company Employee immediately prior to the Closing, and (ii) a level of employee benefits to each Company Employee that is not less favorable, in the aggregate, to the level of employee benefits provided to such Company Employee immediately prior to the Closing (excluding, for these purposes, any equity or equity-based compensation, defined benefit pension benefits, retiree medical benefits or transaction or retention bonus).

(b) Purchaser shall cause the Company or the Company Subsidiary or any other Affiliate of Purchaser employing Company Employees to give each Company Employee who continues to be employed by any of them after the Closing service credit for all pre-Closing service to the same extent recognized immediately prior to the Closing (“Pre-Closing Service”) by the Company or the Company Subsidiary for purposes of eligibility, vesting and benefit accruals and levels of benefits, in each case, under any employee benefit plans or programs or service-based policies sponsored, maintained or contributed to by the Company, the Company Subsidiary, Purchaser or an Affiliate of Purchaser and in which such Company Employees participate.

(c) Purchaser shall cause the Company or the Company Subsidiary or any other Affiliate of Purchaser employing a Company Employee to, (i) with respect to any group health plan in which a Company Employee may be eligible to participate after the Closing, waive, or cause the waiver of, all limitations as to preexisting conditions, exclusions and waiting periods with respect to participation and coverage requirements, other than limitations or waiting periods that are already in effect with respect to such Company Employee and that have not been satisfied as of the Closing under the corresponding Company Plan immediately prior to the Closing, and (ii) with respect to any group health plan in which a Company Employee may be eligible to participate after the Closing (a “New Plan”), to provide such Company Employee with credit for any co-payments and deductibles paid during the portion of the plan year under a corresponding provision of the corresponding Company Plan ending on the date on which participation in the New Plan begins in satisfying any applicable coinsurance, deductible or out of pocket requirements under any such New Plan (to the extent Seller, the Company or any of their respective Subsidiaries provides Purchaser reasonably sufficient data to make such calculations).

(d) Nothing contained in this Agreement is intended to require Purchaser or Seller or any of their respective Subsidiaries to establish or maintain any specific Company Plan for any length of time. Nothing contained in this Agreement is intended to create a Company Plan or amend any Company Plan. This Section 5.6 is included for the sole benefit of the Parties hereto and their respective transferees and permitted assigns and does not and shall not create any right in any Person, including any Company Employee, any participant in any Company Plan or any beneficiary or trustee thereof. Furthermore, nothing contained in this Agreement, express or implied, is intended to confer upon any Person, any right to employment or continued employment for any period of time, or any right to a particular term or condition of employment.

5.7 Post-Closing Arrangements. At the Closing, the applicable parties shall execute and deliver a transition services agreement (the “Transition Services Agreement”) substantially in the form attached hereto as Exhibit B, the software license agreement (the “License Agreement”) substantially in the form attached hereto as Exhibit C and the professional services agreement (the “Professional Services Agreement”) substantially in the form attached hereto as Exhibit D.

5.8 Non-Solicitation; No-Hire.

(a) Seller agrees that for a period of three (3) years from and after the Closing Date it shall not, and it shall cause each of its Subsidiaries not to, without the prior written consent of Purchaser (not to be unreasonably withheld, conditioned or delayed), directly or indirectly, for Seller or any of its

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Subsidiaries or on behalf of another Person, solicit or hire any employee of the Company or the Company Subsidiary or any former employee of the Company or the Company Subsidiary within the last twelve (12) months (including calling or communicating with such employee for the purpose or with the intent of enticing, or in a manner reasonably likely to entice, such employee away from the Company or the Company Subsidiary).

(b) Purchaser agrees that for a period of three (3) years from and after the Closing Date it shall not, and it shall cause each of its Subsidiaries not to, without the prior written consent of Seller (not to be unreasonably withheld, conditioned or delayed), directly or indirectly, for Purchaser or any of its Subsidiaries or on behalf of another Person, solicit or hire any employee of the Seller or any of its Subsidiaries (other than the Company and the Company Subsidiary) with whom Purchaser actually communicated or of whom it learned as a result of the transactions contemplated by this Agreement and the other Transaction Documents (including calling or communicating with such employee for the purpose or with the intent of enticing, or in a manner reasonably likely to entice, such employee away from the Seller or any of its Subsidiaries (other than the Company and the Company Subsidiary)).

(c) Notwithstanding the foregoing, the restrictions set forth in Section 5.8(a) and Section 5.8(b) shall not apply to (i) any Person whose employment was terminated by the other Party or one of its Subsidiaries or (ii) bona fide public advertisements for employment placed by any Party and not specifically targeted at the employees of any other Party. Section 5.8(a) and Section 5.8(b) shall not apply to any Person who is solicited by Seller or Purchaser or any of their respective Subsidiaries, as applicable, (A) pursuant to any existing agreement with employee representatives (such as a works council agreement) by which Seller or Purchaser or any such Subsidiary, as applicable, is legally bound or (B) as a result of actions required to be taken by Seller or Purchaser or any of their respective Subsidiaries, as applicable, in order to comply with local employment Laws. Seller and Purchaser acknowledge and agree that the restrictive covenants set forth in Section 5.8(a) and Section 5.8(b) are a material and substantial part of the transactions contemplated hereby. In the event any court of competent jurisdiction shall determine that the scope, time or territorial restrictions set forth in Section 5.8(a) and Section 5.8(b) are unreasonable, then it is the intention of the Parties that such restrictions be enforced to the fullest extent which the court deems reasonable and Section 5.8(a) and Section 5.8(b) shall thereby be amended and modified accordingly without further action by the Parties hereto.

5.9 No-Shop.

(a) Prior to the Closing, Seller shall not, and shall cause its directors, officers, employees, representatives, advisors and other agents and Subsidiaries not to, directly or indirectly, (i) solicit, initiate, knowingly encourage or otherwise facilitate any Acquisition Proposal (as defined below) or any inquiry relating thereto, (ii) enter into, continue or otherwise participate in any discussions or negotiations regarding any Acquisition Proposal, or (iii) furnish to any Person (other than Purchaser) any non-public information concerning the Business, the Company, the Company Subsidiary or the properties or assets of the Company or the Company Subsidiary; provided, that the foregoing clause (iii) shall not limit the ability to share non-public information with any Person pursuant to non-disclosure agreements entered into in the ordinary course of business or other than with respect to an Acquisition Proposal. For purposes of this Agreement, “Acquisition Proposal” means (A) any proposal or offer for a merger, consolidation, dissolution, sale of substantial assets outside the ordinary course of business, stock purchase, recapitalization, share exchange or other business combination involving the Business, the Company, the Company Subsidiary or the properties or Assets of the Company or the Company Subsidiary, (B) any proposal or offer for the issuance by either the Company or the Company Subsidiary of any of its equity securities or (C) any proposal or offer to acquire in any manner, directly or indirectly, any equity securities of the Company and/or the Company Subsidiary or consolidated total Assets of the Business, the Company and/or the Company Subsidiary, in each case other than the transactions

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contemplated by this Agreement; provided, that the term “Acquisition Proposal” shall not include any proposal or offer that relates to Seller or any of its Subsidiaries or other businesses and that does not conflict with this Agreement.

(b) Seller shall, and shall cause its directors, officers, employees, representatives, advisors and other agents and Affiliates to, (i) immediately cease any discussions or negotiations with respect to an Acquisition Proposal that were pending, (ii) immediately notify any party with which such discussions or negotiations were being held of such termination, (iii) immediately request in writing that all Persons to whom nonpublic information concerning the Business (other than any information shared pursuant to non-disclosure agreements entered into in the ordinary course of business consistent with past practice) has been distributed on or prior to the date of this Agreement destroy or return such information to Seller as soon as possible consistent with the terms of their respective non-disclosure agreements with Seller and (iv) refrain from entering into any transaction relating to or arising from any Acquisition Proposal.

(c) From and after the execution of this Agreement, Seller shall, and shall cause its directors, officers, employees, representatives, advisors and other agents and Affiliates to, promptly advise Purchaser in writing of the receipt, directly or indirectly, of any bona fide written Acquisition Proposal. Seller shall promptly advise Purchaser of all subsequent material communications relating to such Acquisition Proposal.

5.10 No Intellectual Property Rights; Trademark Licenses; Source Code.

(a) The Purchaser acknowledges and agrees that, except as expressly provided in this Agreement, in the License Agreement or in the Transition Services Agreement, the Purchaser is not acquiring any right, title or interest in any Intellectual Property Rights (including any rights under any Material Contract) of Seller and its Affiliates. As promptly as possible following the Closing Date, but not later than (a) ninety (90) days thereafter, with respect to any electronic, digital, computerized or online media, and (b) one hundred eighty (180) days thereafter, with respect to any hard copies or physical materials, Purchaser shall remove, delete, redact or cover all Trademarks owned by Seller or any of its Subsidiaries (other than, after Closing, the Company and the Company Subsidiary) other than the Seller Interoperability Marks (as defined in Section 5.10(c)) (the “Seller Trademarks”) from any materials or content in any media owned or used by the Company or the Company Subsidiary (or at Seller’s option, destroy such materials or content), including websites, signs, billboards, promotional or advertising literature, labels, stationery, office forms and packaging materials. Any use of the Seller Trademarks by the Purchaser, the Company or the Company Subsidiary during the transition periods provided above shall be limited to the use made by the Company or the Company Subsidiary in the conduct of the Business as of the Closing Date. If Purchaser substantially complies with the above obligations by the above deadlines, Purchaser will not be in breach of this Section 5.10(a) for any incidental uses of the Seller Trademarks after such deadlines, if Purchaser promptly removes, deletes, redacts or covers any Seller Trademarks from applicable materials promptly after notice from Seller. Subject to the foregoing terms and conditions, Seller (on behalf of itself and its Subsidiaries) hereby grants Purchaser, the Company and the Company Subsidiary, as of the Closing Date, a non-exclusive, non-assignable, non-sublicensable license to use and display the Seller Trademarks, in a manner consistent with past practice and transitional use, for the above time periods. All goodwill resulting from such use shall inure to Seller. Purchaser covenants that all uses of the Seller Trademarks pursuant to this Section 5.10(a) shall be in a high-quality manner that preserves their goodwill, validity and value. If Purchaser breaches the foregoing covenant regarding any Seller Trademark and does not cure such breach within fifteen (15) days after notice from Seller, Seller may terminate the above license for the applicable Seller Trademarks, effective immediately upon notice.

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(b) As promptly as possible following the Closing Date, but not later than (a) ninety (90) days thereafter, with respect to any electronic, digital, computerized or online media, and (b) one hundred eighty (180) days thereafter, with respect to any hard copies or physical materials, Seller shall remove, delete, redact or cover all Trademarks owned by the Company and the Company Subsidiary other than the Company Interoperability Marks (as defined in Section 5.10(d)) (the “Company Trademarks”) from any materials or content in any media owned or used by Seller or its Subsidiaries (or at Purchaser’s option, destroy such materials or content), including websites, signs, billboards, promotional or advertising literature, labels, stationery, office forms and packaging materials. If Seller substantially complies with the above obligations by the above deadlines, Seller will not be in breach of this Section 5.10(b) for any incidental uses of the Company Trademarks after such deadlines, if Seller promptly removes, deletes, redacts or covers any Company Trademark from applicable materials promptly after notice from Purchaser. Subject to the foregoing terms and conditions, Purchaser (on behalf of itself, Company and the Company Subsidiary) hereby grants Seller and the Seller Subsidiary, a non-exclusive, non-assignable, non-sublicensable license to use and display the Company Trademarks, in a manner consistent with past practice and transitional use, for the above time periods. All goodwill resulting from such use shall inure to the Company. Seller covenants that all uses of the Company Trademarks pursuant to this Section 5.10(b) shall be in a high-quality manner that preserves their goodwill, validity and value. If Seller breaches the foregoing covenant regarding any Company Trademarks and does not cure such breach within fifteen (15) days after notice from Purchaser, Purchaser may terminate the above license for the applicable Company Trademarks, effective immediately upon notice.

(c) If and only if the Parties (or their designees) support AIM/ICQ Interop (as defined in the Transition Services Agreement) either (i) during the term of the Transition Services Agreement or (ii) during the term of a separate agreement regarding AIM/ICQ Interop to be entered into between Seller and Purchaser prior to the expiration of the Transition Services Agreement (in each case, the “AIM/ICQ Interop Period”), and effective upon the commencement of the AIM/ICQ Interop Period, Seller (on behalf of itself and its Subsidiaries) grants Purchaser, the Company and the Company Subsidiary a non-exclusive, non-assignable, non-sublicensable license to use and display Trademarks owned by Seller and its Subsidiaries as required to support AIM/ICQ Interop, which Trademarks shall be set forth in a mutually-agreed writing by the Parties as soon as commercially practicable (the “Seller Interoperability Trademarks”), for the AIM/ICQ Interop Period. All goodwill resulting from such use shall inure to Seller. Purchaser covenants that all uses of the Seller Interoperability Trademarks pursuant to this Section 5.10(c) shall be in a high-quality manner that preserves their goodwill, validity and value. If Purchaser breaches the foregoing covenant regarding any Seller Interoperability Trademarks and does not cure such breach within fifteen (15) days after notice from Seller, Seller may terminate the above license for the applicable Seller Interoperability Trademarks, effective immediately upon notice.

(d) If and only if the Parties (or their designees) support AIM/ICQ Interop during the AIM/ICQ Interop Period, and effective upon the commencement of the AIM/ICQ Interop Period, Purchaser (on behalf of itself, Company and the Company Subsidiary) grants Seller and the Seller Subsidiary a non-exclusive, non-assignable, non-sublicensable license to use the “ICQ Flower” logo and any other Trademarks owned by Company or the Company Subsidiary as required to support AIM/ICQ Interop, which Trademarks shall be set forth in a mutually-agreed writing by the Parties as soon as commercially practicable (the “Company Interoperability Trademarks”) for the AIM/ICQ Interop Period. All goodwill resulting from such use shall inure to the Company. Seller covenants that all uses of the Company Interoperability Trademarks pursuant to this Section 5.10(d) shall be in a high-quality manner that preserves their goodwill, validity and value. If Seller breaches the foregoing covenant regarding any Company Interoperability Trademarks and does not cure such breach within fifteen (15) days after notice from Purchaser, Purchaser may terminate the above license for the applicable Company Interoperability Trademarks, effective immediately upon notice.

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(e) With respect to those Trademarks and domain names contributed to Company by Seller Subsidiary pursuant to that certain Contribution Agreement dated April 22, 2010 and listed in Exhibits A and B to such Contribution Agreement, Seller shall use all reasonable efforts to deliver to Purchaser, at Seller’s cost and expense, documentation evidencing that each such Trademark and domain name is held in the name of Company and, with respect to such Trademarks, that the assignment has been duly delivered to Seller’s local agent to be recorded with the applicable U.S. Patent and Trademark Office and all similar offices and agencies anywhere in the world. With respect to such contributed domain names currently being managed by Melbourne IT on behalf of Seller, Seller shall establish an account with Melbourne IT in the name of the Company for the on-going management and maintenance of such domain names. With respect to the contributed domain names currently managed by Seller or any registrar directly, Purchaser agrees to provide Seller with the name of the domain name management company or registrar used by Purchaser for purposes of facilitating the assignment of such domain names in the name of the Company.

(f) Except as otherwise set forth in the Transition Services Agreement or the Professional Services Agreement, Purchaser agrees that it must procure, at its own expense, licenses or other Contracts for all third party software or other third party items listed on Section 5.10(f) of the Disclosure Letter in order to exercise its rights under this Agreement, the License Agreement, the Professional Services Agreement and the Transition Services Agreement. For each of the third party software components listed on Section 5.10(f) Part 1 of the Disclosure Letter and on Section 5.10(f) Part 2 of the Disclosure Letter, (i) as promptly as reasonably possible following the date of this Agreement, but not later than thirty (30) days thereafter, Seller shall assist Purchaser to identify the appropriate version number of, and the appropriate quantity of licenses required from the applicable vendor for each such third party component and (ii) Seller shall, if reasonably necessary, make an initial introduction on behalf of Purchaser to the vendor of such third party components.

(g) Section 5.10(g) of the Disclosure Letter sets forth a list, as of the date hereof, based on Seller’s good faith effort, of source code related to the Products and certain other products of the Company that will be owned by the Company as of the Closing Date (the “ICQ Software”). The Company will be in possession, as of the Closing Date, of all current source code versions of the ICQ Software, and all former source code versions of the ICQ Software to the extent such former versions are available in the Company’s source-code version control system. Seller and Purchaser will cooperate and work together between the date of this Agreement and the Closing Date to add any applicable additional items to Section 5.10(g) of the Disclosure Letter so as to include any back-end source code that will be delivered by the Seller to the Company pursuant to the License Agreement and the Professional Services Agreement. Seller agrees that it will deliver to Purchaser those versions of the source code for the software licensed under the License Agreement as provided for in Exhibit A, Part 2 to the License Agreement and as follows: (i) Seller will exercise commercially reasonable efforts to provide, as soon as reasonably practicable after the Closing Date, any source code that does not require any modifications to be made for the installation and configuration of such software as provided in the Professional Services Agreement, provided the delivery of, and Purchaser’s use of, such source code would not disrupt or delay the performance by Seller of its obligations under the Professional Services Agreement; and (ii) for all other items listed on Exhibit A, Part 2 of the License Agreement, in connection with Seller’s performance of its obligations under the Professional Services Agreement.

5.11 Insurance Matters. Subject to Section 5.16, Purchaser acknowledges that the policies and insurance coverage maintained on behalf of the Company and the Company Subsidiary are part of the corporate insurance program maintained by Seller (the “Seller Corporate Policies”), that Seller will remove the Company and the Company Subsidiary from the Seller Corporate Policies as of the Closing Date, and that such coverage will not be available or transferred to Purchaser or any of its Subsidiaries.

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5.12 Tax Matters.

(a) Transfer Taxes.

(i) All transfer, filing, recordation (including the cost of recording the assignment or transfer of Intellectual Property Rights), ad valorem, value added, bulk sales, stamp duties, excise, license or similar fees or Taxes incurred in connection with the consummation of the transactions contemplated under this Agreement and the other Transaction Documents (collectively, “Transfer Taxes”) shall be borne one-half by Purchaser and one-half by Seller. Seller and Purchaser shall cooperate with each other in the provision of any information or preparation of any documentation that may be necessary or useful for obtaining any available mitigation, reduction or exemption from any Transfer Taxes.

(ii) Any Tax Returns that must be filed in connection with any Transfer Taxes shall be prepared by the Party that customarily has primary responsibility for filing such Tax Returns pursuant to the applicable Laws under and according to which the respective Tax Returns are due to be filed. For Tax Returns required to be prepared by Seller or any Subsidiary pursuant to this Section 5.12(a)(ii), Seller shall collect the proper Transfer Tax from Purchaser and pay the Transfer Taxes shown on such Tax Return. For Tax Returns required to be prepared by Purchaser pursuant to this Section 5.12(a)(ii), the Purchaser shall collect the proper Transfer Tax from Seller and pay the Transfer Taxes shown on such Tax Return. The filing Party shall use its reasonable commercial efforts to provide to the other Party any Tax Returns which it is required to prepare and file at least ten (10) Business Days before such Tax Returns are due to be filed. Such Tax Returns shall be consistent with the allocation of the Purchase Price as determined pursuant to Section 2.7.

(b) Tax Returns. Seller shall prepare and Purchaser shall timely file (or shall cause to be timely filed) all Tax Returns that are required to be filed for the Company and the Company Subsidiary after the Closing Date with respect to taxable periods ending on or before the Closing Date (“Pre-Closing Tax Periods”). Purchaser shall prepare and file all other Tax Returns that are required to be filed for the Company and the Company Subsidiary after the Closing Date. For Tax Returns relating to Pre-Closing Tax Periods, Seller shall deliver, at least thirty (30) calendar days prior to the due date (including extensions) for filing such Tax Returns, to Purchaser a copy of such Tax Returns for Purchaser’s review and comment, and Seller shall prepare such Tax Returns in a manner consistent with past practice, except as otherwise required by Applicable Law. For Tax Returns relating to taxable periods beginning before and ending after the Closing Date, Purchaser shall deliver, at least thirty (30) calendar days prior the due date (including extensions) for filing such Tax Returns, to Seller a copy of such Tax Returns for Seller’s review and comment. Seller and Purchaser agree to consult and resolve in good faith any issue arising as a result of the review of such Tax Returns and, if the parties are unable to resolve any dispute, shall submit such dispute to the Accounting Referee whose determination shall be binding. Seller shall pay Purchaser the Pre-Closing Portion of any amounts shown to be due on such Tax Returns and all amounts shown to be due on Tax Returns relating solely to Pre-Closing Tax Periods no later than five (5) Business Days prior to the due date of such Tax Returns (including extensions). Purchaser shall not file or cause to be filed without Seller’s consent any amended Tax Return in respect of Taxes for which Seller is liable pursuant to this Agreement.

(c) Examinations and Settlements.

(i) Seller shall be entitled to exercise exclusive control over the handling, disposition and settlement of any inquiry, examination or proceeding by a Governmental Authority (or that portion of any inquiry, examination or proceeding by a Governmental Authority) with respect to Taxes for which Seller may be required to indemnify Purchaser and any Israeli withholding Taxes deducted and withheld and paid to the ITA, provided that (A) Purchaser shall be entitled to participate

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in any such inquiry, examination or proceeding at its cost represented by counsel or representatives of its choosing and (B) Purchaser shall control any inquiry, examination or proceeding if Seller fails to do so. Purchaser shall notify Seller in writing promptly upon learning of any such inquiry, examination or proceeding, provided that failure to so notify shall not relieve Seller of liability hereunder except to the extent Seller is actually prejudiced thereby, and Seller shall inform Purchaser in reasonable detail of each communication or meeting which Purchaser’s representatives do not attend and shall promptly provide copies of each filing and draft filing to Purchaser. Purchaser and its Affiliates shall cooperate with Seller, as Seller may reasonably request, in any such inquiry, examination or proceeding. Neither Purchaser nor any of its Affiliates shall extend, without Seller’s prior written consent, which consent not to be unreasonably withheld, conditioned or delayed, the statute of limitations for any Tax for which Seller may be required to indemnify Purchaser.

(ii) Neither Party (nor any Affiliate of such Party) shall agree to settle any Tax liability or compromise any claim with respect to Taxes, which settlement or compromise may adversely affect the liability for Taxes hereunder (or right to Tax benefit) of Purchaser, the Company or the Company Subsidiary (or their respective Affiliates) after the Closing Date without the other Party’s prior written consent, which consent shall not be unreasonably withheld, conditioned or delayed.

(d) Cooperation and Assistance.

(i) The Parties shall cooperate with each other in the filing of any Tax Returns and the conduct of any Tax audit or other Proceeding, the application for the ITA Withholding Certificate and the refund of any amount withheld or paid to the ITA, to the extent reasonably requested. They each shall execute and deliver such powers of attorney and make available such other documents as are reasonably necessary to carry out the intent of this Section 5.12.

(ii) Upon request or upon payment, each Party shall deliver to the tax director of the other Party copies of all receipts for any non-U.S. Tax with respect to which such other Party or any of its Affiliates could reasonably be expected to claim a foreign tax credit for U.S. federal income tax purposes and any supporting documents required in connection with claiming or supporting a claim for such a foreign tax credit.

(iii) The Parties shall retain records, documents, accounting data and other information in whatever form that are necessary for the preparation and filing, or for any Tax audit, of any and all Tax Returns with respect to any Taxes that relate to taxable periods that do not begin after the Closing Date. Such retention shall be for a period of six (6) years from the date of the Closing. Each Party shall give any other Party reasonable access to all such records, documents, accounting data and other information as well as to its personnel and premises to the extent necessary for a reasonable review or a Tax audit of such Tax Returns and relevant to an obligation under this Section 5.12.

(e) Refunds. If Purchaser or an Affiliate of Purchaser receives a refund with respect to Taxes Seller is responsible for pursuant to this Agreement (including any Israeli withholding Tax in respect of any portion of the Purchase Price), Purchaser or such Affiliate shall pay, within thirty (30) days following the receipt of such refund, the amount of such refund to Seller. If Seller or an Affiliate of Seller receives a refund with respect to Taxes that Purchaser is responsible for pursuant to this Agreement, Seller or such Affiliate shall pay, within thirty (30) days following the receipt of such refund, the amount of such refund to Purchaser.

(f) ITA Withholding Certificate. As soon as practicable (and in no event later than two (2) weeks) after the execution of this Agreement, Seller shall complete in good faith and submit to the ITA a request for an ITA Withholding Certificate to determine the amount (if any) of Israeli

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withholding Tax required to be withheld and remitted to the ITA in respect of the sale of the Securities pursuant to this Agreement and shall attempt in good faith to obtain an ITA Withholding Certificate within two (2) months after the execution of this Agreement.

5.13 Mail Handling; Post-Closing Payments. To the extent that Purchaser and/or any of its Subsidiaries receives any mail, packages or post-Closing payments addressed and delivered to Purchaser, the Company or the Company Subsidiary not relating to the Business and relating to the business of Seller and its Subsidiaries, Purchaser shall promptly deliver such mail, packages or post-Closing payments to Seller. To the extent that Seller or its Subsidiaries receives any mail, packages or post-Closing payments addressed and delivered to Seller or its Subsidiaries and relating to the Business, Seller shall promptly deliver such mail, packages or post-Closing payments to Purchaser.

5.14 Resignations. Seller shall use good faith efforts to obtain the resignation of each Manager, director and officer of the Company and the Company Subsidiary, in their capacity as such, as requested by Purchaser prior to the Closing.

5.15 Consents. Purchaser acknowledges that certain consents and waivers with respect to the transactions contemplated hereby and by the other Transaction Documents may be required from parties to Contracts to which the Company or any of their Subsidiaries is a party and that such consents and waivers have not been obtained. Purchaser agrees that, notwithstanding anything herein to the contrary, neither Seller, its Subsidiaries nor any other Person shall have any liability whatsoever to Purchaser arising out of or relating to the failure to obtain any consents or waivers that may be required in connection with the transactions contemplated hereby or by the other Transaction Documents or because of the termination of any Contract as a result thereof. Purchaser further agrees that no representation, warranty or covenant of Seller contained herein shall be breached or deemed breached, and no condition shall be deemed not satisfied, as a result of (a) the failure to obtain any such consent or waiver, (b) any such termination or (c) any Proceeding commenced or threatened by or on behalf of any Person arising out of or relating to the failure to obtain any such consent or any such termination. Prior to the Closing, Seller shall, and shall cause its Subsidiaries to, cooperate with Purchaser, upon the request of Purchaser, in any reasonable manner in connection with Purchaser obtaining any such consents and waivers; provided that such cooperation shall not include any requirement of Seller, its Subsidiaries or any other Person to expend money or commence, defend or participate in any litigation to any third party.

5.16 Director and Officer Indemnification. From and after the Closing Date, the Company and the Company Subsidiary shall indemnify each present and former director and officer of each of the Company and the Company Subsidiary from any and all claims arising out of or in connection with activities in such capacity to the fullest extent provided under Delaware or Israeli Law, as applicable, and in addition, to the fullest extent provided in their respective charters, by-laws or limited liability company agreement, as applicable, which obligations shall survive the Closing and shall continue in full force and effect for a period of not less than six (6) years from the Closing Date; provided, however, that if any claim or claims are asserted or made within such six (6)-year period, all rights to indemnification in respect of any such claim or claims shall continue until disposition of any and all such claims. Notwithstanding the foregoing, (a) Seller shall, at Seller’s expense, provide such directors and officers with an extension of existing D&O insurance coverage for six (6) years following the Closing Date of not less than the existing coverage of such insured directors and officers than the insurance coverage currently provided to such directors and officers and (b) to the extent consistent with such insurance, such insured directors and officers shall claim for coverage under such D&O insurance policy prior to making a claim for indemnification against the Company and/or the Company Subsidiary pursuant to this Section 5.16.

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ARTICLE VI

CONDITIONS TO CLOSING

6.1 Conditions Precedent to Obligations of Purchaser and Seller. The respective obligations of the Parties to consummate and cause the consummation of the transactions contemplated by this Agreement to occur at the Closing shall be subject to the satisfaction (or waiver by both Purchaser and Seller) at or prior to the Closing Date of each of the following conditions:

(a) No Injunction, etc. No Governmental Authority of competent jurisdiction shall have enacted, issued, promulgated, enforced or entered any Order which is in effect on the Closing Date which has or would have the effect of prohibiting the transactions contemplated by this Agreement and the other Transaction Documents or making such transactions illegal; and

(b) Regulatory Authorizations. (i) All Consents of any Governmental Authorities listed in Section 6.1(b) of the Disclosure Letter shall have been obtained and shall be in full force and effect, and (ii) if applicable, the waiting period under any applicable Antitrust Regulation shall have expired or been terminated.

6.2 Conditions Precedent to Obligation of Seller. The obligation of Seller to consummate and cause the consummation of the transactions contemplated by this Agreement to occur at the Closing shall be subject to the satisfaction (or waiver by Seller) at or prior to the Closing Date of each of the following conditions:

(a) Accuracy of Purchaser’s Representations and Warranties. The representations and warranties of Purchaser contained in this Agreement and the other Transaction Documents shall be true and correct in all respects (without reference to any Purchaser Material Adverse Effect or other materiality qualifications contained therein) on the Closing Date as though made on the Closing Date (or if such representations and warranties by their terms speak of an earlier date, in which case they shall be true and correct in all respects as of such earlier date) except for such failures to be true and correct which would not, individually or in the aggregate, reasonably be expected to have a Purchaser Material Adverse Effect (provided, that the Purchaser’s representations in Section 4.1, Section 4.2(a), Section 4.2(b) with respect to clause (i) and Section 4.6 shall be true and correct in all material respects); and Seller shall have received a certificate signed by an authorized officer of Purchaser to such effect.

(b) Covenants of Purchaser. Purchaser shall have complied in all material respects with all covenants contained in this Agreement to be performed by it prior to the Closing; and Seller shall have received a certificate signed by an authorized officer of Purchaser to such effect.

(c) Closing Documents. Purchaser shall have executed and delivered each of the closing documents described in Section 2.6.

(d) ITA Withholding Certificate. Seller shall have received an ITA Withholding Certificate from the ITA; provided, however, that if Seller has not received such ITA Withholding Certificate by the later of (i) the two month anniversary of the date hereof and (ii) ten (10) Business Days following the date on which the condition set forth in Section 6.1(b) has been satisfied, then Seller shall be deemed to have waived the condition set forth in this clause (d).

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6.3 Conditions Precedent to Obligation of Purchaser. The obligation of Purchaser to consummate and cause the consummation of the transactions contemplated by this Agreement to occur at the Closing shall be subject to the satisfaction (or waiver by Purchaser) at or prior to the Closing Date of each of the following conditions:

(a) Accuracy of Seller’s Representations and Warranties. The representations and warranties of Seller contained in this Agreement and the other Transaction Documents shall be true and correct in all respects (without reference to any Company Material Adverse Effect or other materiality qualifications contained therein other than in the case of clause (ii) of Section 3.16(a)) on the Closing Date as though made on the Closing Date (or if such representations and warranties by their terms speak of an earlier date, in which case they shall be true and correct in all respects as of such earlier date) except for such failures to be true and correct which would not, individually or in the aggregate, reasonably be expected to have a Company Material Adverse Effect (provided, that the Seller representations in Section 3.1, Section 3.2(a), Section 3.2(b) with respect to clause (i) and the last sentence of each of Section 3.4(a) and Section 3.4(b) shall be true and correct in all material respects); and Purchaser shall have received a certificate signed by an authorized officer of Seller to such effect.

(b) Covenants of Seller. Seller, Seller Subsidiary, the Company and the Company Subsidiary shall have complied in all material respects with all covenants contained in this Agreement to be performed by them prior to the Closing; and Purchaser shall have received a certificate signed by an authorized officer of Seller to such effect.

(c) No Company Material Adverse Effect. Except as set forth in Section 6.3(c) of the Disclosure Letter, since December 31, 2009, there shall not have occurred and be continuing any Company Material Adverse Effect.

(d) Termination of Guarantee Agreement. The Guarantee Agreement shall have been terminated with respect to the Company and the Company Subsidiary and be of no further force and effect against each of them and the Assets held by the Company and the Company Subsidiary without any further liability or obligation, and evidence of the foregoing reasonably satisfactory to Purchaser shall have been delivered to Purchaser.

(e) Termination of Security Agreement and Security Interests. The Security Agreement shall have been terminated with respect to the Company and the Company Subsidiary and be of no further force and effect against each of them and the Assets held by the Company and the Company Subsidiary without any further liability or obligation (including full release of Liens imposed on Trademarks of the Company and the Company Subsidiary), and evidence of the foregoing reasonably satisfactory to Purchaser shall have been delivered to Purchaser.

(f) Termination of Patent Security Agreement and Security Interests. The Patent Security Agreement shall have been terminated with respect to the Company and the Company Subsidiary and be of no further force and effect against each of them and the Assets held by the Company and the Company Subsidiary without any further liability or obligation (including full release of Liens imposed on Patents of the Company and the Company Subsidiary), and evidence of the foregoing reasonably satisfactory to Purchaser shall have been delivered to Purchaser.

(g) Closing Documents. Seller shall have executed and delivered each of the closing documents set forth in Section 2.5.

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ARTICLE VII

INDEMNIFICATION

7.1 Indemnification.

(a) Following the Closing and subject to the terms and conditions of this ARTICLE VII, Seller shall indemnify, defend and hold harmless Purchaser and its Subsidiaries (including the Company and the Company Subsidiary) and their officers, directors, employees, successors, assigns, representatives and agents (each, a “Purchaser Indemnified Party”) from and against, and shall reimburse each Purchaser Indemnified Party for, all losses, damages, liabilities, Taxes, costs and expenses, including reasonable attorneys’ fees and expenses, imposed upon or incurred by such Purchaser Indemnified Party (“Purchaser Losses”), arising out of or resulting from:

(i) any failure of any representation or warranty of Seller or any of its Subsidiaries set forth in this Agreement or the other Transaction Documents (or in any certificate delivered in connection therewith) to be true and correct when made;

(ii) any breach of any covenant or agreement of Seller or any of its Subsidiaries (including the Company and the Company Subsidiary prior to the Closing) set forth in this Agreement or the other Transaction Documents; and

(iii) without duplication (A) all Taxes of the Seller and its Affiliates (other than the Company and the Company Subsidiary, which are addressed in clause (B) below) other than Transfer Taxes for which Purchaser is responsible under Section 5.12(a)(i); (B) all Taxes of the Company (including any predecessor), the Company Subsidiary (including any predecessor) or the Business for all Tax periods through the Closing Date and, with respect to any taxable period of the Company or the Company Subsidiary that begins prior to the Closing Date and ends after the Closing Date, for the portion of such period through the end of the day on the Closing Date; (C) any liability for Taxes for Pre-Closing Tax Periods as a result of an express or implied obligation to indemnify or otherwise assume or succeed such liability to another Person other than any such express or implied obligation incurred following the Closing; (D) all Taxes relating to or arising from the conversion of the Company from a corporation to a limited liability company; and (E) all Israeli withholding Taxes in respect of the sale of the Securities pursuant to this Agreement.

(b) Following the Closing and subject to the terms and conditions provided in this ARTICLE VII, Purchaser shall indemnify, defend and hold harmless Seller and its Subsidiaries and their officers, directors, employees, successors, assigns, representatives and agents (each, a “Seller Indemnified Party”) from and against, and shall reimburse each Seller Indemnified Party for, all losses, damages, liabilities, Taxes, costs and expenses, including reasonable attorneys’ fees and expenses, imposed upon or incurred by such Seller Indemnified Party (“Seller Losses”), arising out of or resulting from:

(i) the failure of any representation or warranty of Purchaser set forth in this Agreement or the other Transaction Documents (or in any certificate delivered in connection therewith) to be true and correct when made;

(ii) any breach of any covenant or agreement of Purchaser set forth in this Agreement or the other Transaction Documents; and

(iii) without duplication (A) all Taxes of the Purchaser and its Affiliates (other than the Company and the Company Subsidiary or any successor thereto) other than Transfer Taxes for which Seller is responsible under Section 5.12(a)(i); and (B) all Taxes of the Company (including any successor) or the Company Subsidiary (including any successor) for all Tax periods after the Closing Date and, with respect to any taxable period of the Company or the Company Subsidiary that begins prior to the Closing Date and ends after the Closing Date, for the portion of such period after the Closing Date.

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(c) Notwithstanding the foregoing, Purchaser Losses and Seller Losses shall not be recoverable under the terms of this Agreement to the extent it (i) consists of or is based upon consequential (including, but not limited to, lost profits), incidental, punitive, special, indirect or similar damages (unless such damages are actually paid to a third party) or (ii) is addressed through the adjustments in Section 2.3; provided, however, that the foregoing limitation on Purchaser Losses and Seller Losses shall not apply in the case of fraud or willful breach.

(d) For purposes of Section 7.1(a)(iii)(B) and 7.1(b)(iii)(B), whenever it is necessary to determine the amount of any Taxes of the Company or the Company Subsidiary attributable to (i) the portion of a taxable period that begins prior to the Closing Date and ends at the end of the day on the Closing Date (the “Pre-Closing Portion”) or (ii) the portion of a taxable period that begins after the Closing Date (the “Post-Closing Portion”), the amount shall be determined based upon a hypothetical closing of the taxable year at the end of the day on the Closing Date with the Closing Date being included in the Pre-Closing Portion, except that exemptions, allowances or deductions that are calculated on an annual basis shall be apportioned on a time basis; provided, however, that any Taxes that are not based on income, purchases or receipts shall be determined by reference to the relative number of days in the Pre-Closing Portion or the Post-Closing Portion, as applicable.

7.2 Certain Limitations.

(a) Notwithstanding anything contained in any Transaction Document to the contrary, Seller shall not be obligated to indemnify any Purchaser Indemnified Parties (A) for Purchaser Losses under Section 7.1(a)(i) of this Agreement (other than in respect of the Seller Specified Reps) and for any breach of the Transition Services Agreement or the Professional Services Agreement and for any breach of a covenant contained in this Agreement insofar as it directly relates to the Transition Services Agreement or the Professional Services Agreement (including Section 9.13 hereof) collectively in the aggregate in excess of twenty eight million, one hundred twenty five thousand dollars ($28,125,000) (the “Cap”) or (B) with respect to all Purchaser Losses under Section 7.1(a) and for any breach of the Transition Services Agreement or the Professional Services Agreement (including breaches involving fraud or willful breach) collectively in the aggregate in excess of the Purchase Price (the “Aggregate Cap”); provided, that neither the Cap nor the Aggregate Cap shall apply in the case of fraud or willful breach involving this Agreement.

(b) Notwithstanding anything contained in any Transaction Document to the contrary, Purchaser shall not be obligated to indemnify any Seller Indemnified Parties (A) for Seller Losses under Section 7.1(b)(i) of this Agreement (other than in respect of the Purchaser Specified Reps) and for any breach of the Transition Services Agreement or the Professional Services Agreement and for any breach of a covenant contained in this Agreement insofar as it directly relates to the Transition Services Agreement or the Professional Services Agreement (including Section 9.13 hereof) collectively in the aggregate in excess of the Cap or (B) with respect to all Seller Losses under Section 7.1(b) and for any breach of the Transition Services Agreement or the Professional Services Agreement (including breaches involving fraud or willful breach) collectively in the aggregate in excess of the Aggregate Cap; provided, that neither the Cap nor the Aggregate Cap shall apply in the case of fraud or willful breach involving this Agreement.

(c) Notwithstanding anything to the contrary contained in this Agreement and subject to Section 7.1(c) and Section 7.2(c) of the Seller Disclosure Letter, Seller shall not be liable for any Purchaser Losses unless and until the aggregate amount of all Purchaser Losses incurred by Purchaser exceeds two million dollars ($2,000,000) (the “Deductible”) and then Seller shall be liable for aggregate amount of all Purchaser Losses (excluding the amount of the Deductible); provided, however, that (i) all Purchaser Losses up to the Deductible shall be calculated and included in the Deductible only to the

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extent Purchaser Losses resulting from any single claim or aggregate claims arising out of substantially the same facts, events or circumstances exceed the Lower Threshold and (ii) all Purchaser Losses in excess of the Deductible shall be calculated and included as Purchaser Losses for any purpose under this Article VII only to the extent Purchaser Losses resulting from any single claim or aggregate claims arising out of substantially the same facts, events or circumstances exceed the Higher Threshold; provided, further, that, for purposes of determining whether a Purchaser Loss applies to the Lower Threshold or the Higher Threshold, such determination shall be made based on timing of Purchaser Indemnified Party’s discovery of the event underlying such Purchaser Loss; provided, further, that the Deductible, the Lower Threshold and the Higher Threshold shall not apply to indemnification claims for Purchaser Losses under Section 7.1(a)(i) for breach of Seller Specified Reps or under Sections 7.1(a)(ii) or 7.1(a)(iii), or for fraud or willful breach.

(d) The representations and warranties of Seller and Purchaser contained in ARTICLE III (as modified by the Disclosure Letter) and ARTICLE IV, respectively, of this Agreement shall survive the Closing until the twelve (12)-month anniversary of the Closing Date, other than the representations set forth in (i) Section 3.1, Section 3.2(a), Section 3.2(b) with respect to clause (i) only, Section 3.4(a), Section 3.4(b), Section 3.10 and Section 3.11 (collectively, the “Seller Specified Reps”) and Section 4.1, Section 4.2, Section 4.4 and Section 4.6 (collectively, the “Purchaser Specified Reps”) which shall survive until thirty (30) days after the expiration of the applicable statute of limitations with respect to the matters contained therein or, if no such applicable statute of limitations exists, indefinitely. The covenants and agreements contained in this Agreement shall survive the Closing until the date or dates specified therein or, if not so specified, until the expiration of the applicable statute of limitations with respect to the matters contained therein or, if no such applicable statute of limitations exists, indefinitely. Notwithstanding the foregoing, no time limitations shall apply to any claims based on fraud or willful breach.

(e) The obligations to indemnify, defend and hold harmless a Party pursuant to Section 7.1(a) or 7.1(b) shall terminate if the applicable representation, warranty or covenant terminates pursuant to Section 7.2(d); provided, however, that such obligations to indemnify and hold harmless shall not terminate with respect to any item as to which the Seller Indemnified Party or Purchaser Indemnified Party, as the case may be, to be indemnified (each, an “Indemnified Party”) shall have, before the expiration of the applicable survival period, made a claim by delivering a written notice (stating in reasonable detail the basis of such claim) to the Indemnifying Party.

(f) Notwithstanding anything contained herein or elsewhere to the contrary, all “material,” “materially” or Company Material Adverse Effect qualifiers contained in the representations and warranties (or definitions used in the representations and warranties) set forth in ARTICLE III (other than clause (ii) of Section 3.16(a)) and ARTICLE IV of this Agreement and in the certificates delivered pursuant to Section 6.2(a) or Section 6.3(a) shall be ignored and not given any effect for purposes of the indemnification provisions hereof, including, without limitation, for purposes of determining whether or not a breach of a representation or warranty has occurred, in determining whether the limitations in this Section 7.2 have been satisfied (including the Deductible) and/or in determining the amount of any indemnifiable Purchaser Losses.

(g) Except with respect to intentionally concealed matters, no information or knowledge acquired, or investigations conducted, by Purchaser or its representatives, of the Business, the Company, the Company Subsidiary or otherwise, shall in any way limit, or constitute a waiver of, or a defense to, any claim for indemnification by Purchaser or any Purchaser Indemnified Party under this Agreement.

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7.3 Notice of Loss; Procedures for Third-Party Claims.

(a) Notice of Loss. An Indemnified Party shall give the indemnifying party hereunder (the “Indemnifying Party”) notice of any matter which an Indemnified Party has determined has given or could give rise to a right of indemnification under this Agreement promptly following such determination, stating in reasonable detail the nature and basis of the claim and the amount thereof, the method of computation thereof, and containing a reference to the provisions of this Agreement in respect of which such right of indemnification is claimed or arises. Failure of the Indemnified Party to give such notice shall not relieve the Indemnifying Party from liability on account of this indemnification, except if and to the extent the Indemnifying Party is actually prejudiced thereby.

(b) Third Party Claim Procedures. Promptly after the receipt by any Indemnified Party of a notice of any claim, action, suit or Proceeding by any third party that may be subject to indemnification hereunder, such Indemnified Party shall give written notice of such claim to the Indemnifying Party, stating in reasonable detail the nature and basis of the claim and the amount thereof, to the extent known, along with copies of the relevant documents evidencing the claim, the basis for indemnification sought and the method of computation of the amount to which the Indemnified Party claims to be entitled hereunder. Failure of the Indemnified Party to give such notice shall not relieve the Indemnifying Party from liability on account of this indemnification, except if and to the extent the Indemnifying Party is actually prejudiced thereby. Thereafter, the Indemnified Party shall deliver to the Indemnifying Party, promptly after the Indemnified Party’s receipt thereof, copies of all notices and documents (including court papers) received by the Indemnified Party relating to the claim and reasonably cooperate with the Indemnifying Party in evaluating and defending such claims. The Indemnifying Party shall have the right to assume the defense of the Indemnified Party against the third party claim if (i) it gives notice of its intention to do so to the Indemnified Party prior to the substantial completion of discovery relating to such third party claim and (ii) the Indemnifying Party acknowledges its indemnity obligation hereunder in respect of such Losses relating thereto, subject to the terms hereof. So long as the Indemnifying Party has assumed the defense of the third party claim in accordance herewith and notified the Indemnified Party in writing thereof, (A) the Indemnified Party may retain separate co-counsel at its sole cost and expense and participate in the defense of the third party claim, (B) the Indemnified Party shall not file any papers or consent to the entry of any judgment or enter into any settlement with respect to the third party claim without the prior written consent of the Indemnifying Party (not to be unreasonably withheld or delayed) and (C) the Indemnifying Party will not consent to the entry of any judgment or enter into any settlement with respect to the third party claim (other than a judgment or settlement that is solely for money damages payable by the Indemnifying Party and is accompanied by a release of all claims against the Indemnified Party) without the prior written consent of the Indemnified Party (not to be unreasonably withheld or delayed). Whether or not the Indemnifying Party shall have assumed the defense, such Indemnifying Party shall not be obligated to indemnify the Indemnified Party hereunder for any settlement entered into without the Indemnifying Party’s prior written consent, which consent shall not be unreasonably withheld or delayed. The parties will use commercially reasonable efforts to minimize Losses from third party claims and will act in good faith in responding to, defending against, settling or otherwise dealing with such claims.

7.4 Treatment of Indemnification Payments. Any payment made pursuant to the indemnification obligations under Section 5.12 or this ARTICLE VII shall be treated as an adjustment to the purchase price. Any indemnity payment under this Agreement shall be (i) decreased by any (A) amounts actually recovered from third parties or amounts actually recovered by the Indemnified Party under third party insurance policies with respect to such Loss or (B) tax benefits actually realized by the Indemnified Party in respect of such Loss to the extent such benefits reduce the Tax liability of the Indemnified Party for the tax year in which the payment is received or in any of the two (2) succeeding tax years, and (ii) increased by the cost incurred by the Indemnified Party in pursuing such contribution or indemnification from third parties and available insurance claims (including increased insurance premiums).

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7.5 Remedies Exclusive. Following the Closing, the remedies set forth in this ARTICLE VII shall constitute the sole and exclusive remedy and shall be in lieu of any other remedies that may be available to the Indemnified Parties under any other agreement or pursuant to any statutory or common law (including Environmental Law), other than claims arising out of fraud and willful breach or for specific performance, with respect to any Losses or remedy of any kind or nature incurred directly or indirectly resulting from or arising out of the Transaction Documents, the transactions contemplated thereby, the Securities or the Business. Seller and Purchaser each hereby waive any provision of any applicable Law to the extent that it would limit or restrict the agreement contained in this Section 7.5.

7.6 Mitigation. Purchaser and Seller shall cooperate with each other with respect to resolving any claim or liability with respect to which either such Party is obligated to indemnify Indemnified Parties hereunder, including by making commercially reasonable efforts to mitigate or resolve any such claim or liability.

ARTICLE VIII

TERMINATION

8.1 Termination Events. Without prejudice to other remedies which may be available to the Parties by Law or this Agreement, this Agreement may be terminated and the transactions contemplated herein may be abandoned:

(a) by mutual consent of the Parties;

(b) after the Outer Date, by any Party by notice to the other Party if the Closing shall not have been consummated on or prior to the Outer Date; provided, however, that the right to terminate this Agreement under this Section 8.1(b) shall not be available to any Party whose action or failure or whose Affiliate’s action or failure to perform any of its obligations under this Agreement, or failure to act in good faith, has been the principal cause of, or resulted in, the failure of the Closing to occur on or before such date; and provided, further, that neither Purchaser nor Seller shall have the right to terminate this Agreement pursuant to this Section 8.1(b) in the event the other party has initiated Proceedings to specifically enforce this Agreement while such Proceedings are still pending;

(c) by any Party prior to the Closing by notice to the other Party, if a final, non-appealable Order enjoining or otherwise prohibiting consummation of the transactions contemplated by this Agreement has been issued after the date hereof by any federal or state court in the United States having jurisdiction (unless such order, decree or ruling has been withdrawn, reversed or otherwise made inapplicable); provided, however, that the Party seeking to terminate this Agreement pursuant to this Section 8.1(c) shall have complied with Section 5.3 hereunder to prevent the entry of and to remove or avoid the imposition of such Order;

(d) by Seller prior to the Closing, upon written notice to Purchaser, if (i) Purchaser shall have materially breached any of the covenants or agreements contained in this Agreement to be complied with by Purchaser unless, to the extent such breach is capable of being cured, Purchaser shall have cured such breach within fifteen (15) days of receiving notice from Seller of such breach or (ii) there exists a breach of any representation or warranty of Purchaser contained in this Agreement such that the closing condition set forth in Section 6.2(a) would not be satisfied and such breach is incapable of being cured by the Outer Date; or

(e) by Purchaser prior to the Closing, upon written notice to Seller, if (i) Seller shall have materially breached any of the covenants or agreements contained in this Agreement to be complied with by Seller, Seller Subsidiary, the Company or the Company Subsidiary unless, to the extent such

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breach is capable of being cured, Seller shall have cured such breach within fifteen (15) days of receiving notice from Purchaser of such breach or (ii) there exists a breach of any representation or warranty of Seller contained in this Agreement such that the closing condition set forth in Section 6.3(a) would not be satisfied and such breach is incapable of being cured by the Outer Date.

8.2 Effect of Termination. In the event of any termination of the Agreement as provided in Section 8.1, this Agreement shall forthwith become wholly void and of no further force and effect and there shall be no liability on the part of Purchaser or Seller, except that the obligations of Purchaser and Seller under Sections 5.2(b) and 5.4, this Section 8.2 and ARTICLE IX of this Agreement shall remain in full force and effect. Notwithstanding the foregoing, the provisions of this Section 8.2 shall not relieve either party of any liability for fraud or willful breach of this Agreement occurring prior to such termination.

ARTICLE IX

MISCELLANEOUS AGREEMENTS OF THE PARTIES

9.1 Notices. Subject to Section 9.10, all communications provided for hereunder shall be in writing and shall be deemed to be given when delivered in person or by private courier with receipt, when telefaxed and received, or five (5) Business Days after being deposited in the United States mail, first-class, registered or certified, return receipt requested, with postage paid and, or to such other address as any such Party shall designate by written notice to the other Party.

(a) If to Purchaser:		Digital Sky Technologies Limited
		123317 Moscow, Presnenskaya naberezhanaya
		10, Block C, 57th Floor Russia
		Attention:	Verdi Israelian
		Email:	verdi@dstadvisors.ru
		Fax:	+7 (493) 363-1364
	with a copy to:	Goodwin Procter LLP
	(which shall not	901 New York Avenue, NW
	constitute notice)	Washington, DC 20001
		Attention:	James A. Hutchinson, Esq. and
			Seung W. Baik, Esq.
		Email:	jhutchinson@goodwinprocter.com and sbaik@goodwinprocter.com
		Fax:	(202) 346-4444
(b) If to Seller:		AOL Inc.
		770 Broadway Avenue
		New York, NY 10003
		Attention:	General Counsel
		Fax:	(703) 265-3922
	with a copy to:	Simpson Thacher & Bartlett LLP
	(which shall not	2550 Hanover Street
	constitute notice)	Palo Alto, CA 94304
		Attention:	Peter Malloy, Esq.
		Email:	pmalloy@stblaw.com
		Fax:	(650) 251-5002

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9.2 Severability. If any provision of this Agreement shall be declared by any court of competent jurisdiction to be illegal, void or unenforceable, all other provisions of this Agreement shall not be affected and shall remain in full force and effect, and Seller and Purchaser shall negotiate in good faith to replace such illegal, void or unenforceable provision with a provision that corresponds as closely as possible to the intentions of the Parties as expressed by such illegal, void or unenforceable provision.

9.3 Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed to be an original and all of which together shall be deemed to be one and the same instrument. Copies of executed counterparts transmitted by telecopy, telefax or other electronic transmission service shall be considered original executed counterparts for purposes of this Agreement.

9.4 Expenses. Except as otherwise expressly provided herein, whether or not the Closing occurs, Seller and Purchaser shall each pay their respective expenses (including, without limitation, legal, investment banker and accounting fees) incurred in connection with the negotiation and execution of this Agreement and the other Transaction Documents and the consummation of the transactions contemplated hereby and thereby; provided, however, that, for the avoidance of doubt, Seller shall pay all such expenses of the Company and the Company Subsidiary incurred on or prior to the Closing (excluding any expenses incurred by the Company and the Company Subsidiary after giving effect to the Closing).

9.5 Assignment. This Agreement shall not be assigned by either Party without the prior written consent of the other Party, and any attempted assignment, without such consent, shall be null and void; provided, however, Purchaser may assign any or all of its rights and obligations under this Agreement to any Subsidiary of Purchaser that is directly or indirectly wholly-owned by Purchaser or of whose equity only a de minimis amount of is not directly or indirectly owned by Purchaser (provided that no such assignment shall release Purchaser from any obligation or liability under this Agreement). Subject to the preceding sentence, this Agreement will be binding upon, inure to the benefit of, and be enforceable by the Parties and their respective successors and assigns.

9.6 Amendment; Waiver. This Agreement may be amended, supplemented or otherwise modified only by a written instrument executed by both Parties. No waiver by either Party of any of the provisions hereof shall be effective unless explicitly set forth in writing and executed by the Party so waiving. Except as provided in the preceding sentence or otherwise herein, no action taken pursuant to this Agreement, including any investigation by or on behalf of any Party, or a failure or delay by any Party in exercising any power, right or privilege under this Agreement shall be deemed to constitute a waiver by the Party taking such action of compliance with any representations, warranties, covenants, or agreements contained herein, and in any documents delivered or to be delivered pursuant to this Agreement and in connection with the Closing hereunder. The waiver by any Party of a breach of any provision of this Agreement shall not operate or be construed as a waiver of any subsequent breach.

9.7 Specific Performance. Subject to Section 7.5, the Parties agree that immediate and irreparable damage, for which money damages would not be an adequate remedy, would occur in the event any provision of this Agreement is not performed in accordance with the terms hereof and that the Parties shall be entitled to an injunction or injunctions (without posting a bond or other undertaking) to prevent breaches of this Agreement and to enforce specifically the terms and provisions of this Agreement in addition to any other remedy to which they are entitled at law or in equity. Notwithstanding Section 7.5, in the event that any action shall be brought in equity to enforce the provisions of this Agreement, no party shall allege, and each party hereby waives the defense, that there is an adequate remedy at law.

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9.8 Third Parties. This Agreement does not create any rights, claims or benefits inuring to any Person that is not a Party nor create or establish any third party beneficiary hereto other than the provisions of Section 5.16 and ARTICLE VII hereof with respect to indemnification under which the indemnitees thereunder shall be third party beneficiaries.

9.9 Governing Law. This Agreement and the exhibits and schedules hereto shall be governed by, and construed and interpreted in accordance with, the Laws of the State of New York.

9.10 Consent to Jurisdiction; Waiver of Jury Trial. Each party irrevocably submits to the exclusive jurisdiction of any state or Federal court located within the Borough of Manhattan, City of New York in the State of New York, for the purposes of any suit, action or other proceeding arising out of this Agreement or any transaction contemplated hereby. Each of the Parties further agrees that service of any process, summons, notice or document by U.S. registered mail to such Party’s respective address set forth in Section 9.1 shall be effective service of process for any action, suit or proceeding in New York with respect to any matters to which it has submitted to jurisdiction as set forth above in the immediately preceding sentence. Purchaser hereby irrevocably designates CT Corporation as its for the acceptance of service of process in order to confer jurisdiction over it upon any state or Federal court located within the Borough of Manhattan, City of New York in the State of New York (the “Chosen Courts”) and Purchaser will take all necessary actions to maintain the effectiveness of this appointment. Each of the Parties, irrevocably and unconditionally waives any objection to the laying of venue of any action, suit or proceeding set forth above arising out of this Agreement or the transactions contemplated hereby, and hereby further irrevocably and unconditionally waives and agrees not to plead or claim in any such Chosen Court that any such action, suit or proceeding brought in any such Chosen Court has been brought in an inconvenient forum. Nothing in this Section 9.10 shall limit the jurisdictions in which a judgment of the Chosen Courts may be enforced. THE PARTIES HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER AGREEMENT ENTERED INTO IN CONNECTION THEREWITH AND FOR ANY COUNTERCLAIM WITH RESPECT THERETO.

9.11 Disclosure Letter. Seller may, at its option, include in the Disclosure Letter items that are not material in order to avoid any misunderstanding, and such inclusion, or any references to dollar amounts, shall not be deemed to be an acknowledgement or representation that such items are material, to establish any standard of materiality or to define further the meaning of such terms for purposes of this Agreement. Information disclosed in any section or subsection of the Disclosure Letter shall be deemed to be disclosed with respect to any other section or subsection of the Disclosure Letter to the extent such disclosure is specifically cross-referenced or is otherwise reasonably apparent as being applicable from the face of the disclosure itself. From time to time prior to the Closing, Seller shall have the right to supplement or amend the Disclosure Letter with respect to any matter hereafter arising. No such supplement or amendment shall have any effect on the satisfaction of the condition to closing set forth in Section 6.3 or for purposes of indemnification obligations of Seller under Section 7.1(a). The disclosure of any matter of item in any section of the Disclosure Letter shall not be deemed to constitute an acknowledgement that any such matter is required to be disclosed.

9.12 Entire Agreement. The Transaction Documents, Confidentiality Agreement, the Disclosure Letter and the exhibits hereto and any other agreements between Purchaser and Seller entered into on the date hereof set forth the entire understanding of the Parties with respect to the subject matter hereof and there are no agreements, understandings, representations or warranties between the Parties or their respective Subsidiaries other than those set forth or referred to herein or therein.

9.13 Further Assurances Regarding Transaction Documents. Prior to Closing, at the reasonable request of, and in consultation with, the other Party, each Party shall take such reasonable

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actions as shall be necessary to facilitate its performance under the other Transaction Documents, including (a) Purchaser designating the Back-End Site and the Purchaser Representatives, and beginning to procure certain Hardware and Software and (b) Seller beginning the training of such Purchaser Representatives (as such terms are defined in the Professional Services Agreement).

9.14 Section Headings; Table of Contents. The section headings contained in this Agreement and the Table of Contents to this Agreement are for reference purposes only and shall not affect the meaning or interpretation of this Agreement.

[Signature pages follow]

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IN WITNESS WHEREOF, the Parties have caused this Securities Purchase Agreement to be duly executed as of the date first above written.

AOL INC.
By:	/s/ Arthur Minson
	Name:	Arthur Minson
	Title:	EVP and CFO

DIGITAL SKY TECHNOLOGIES LIMITED
By:	/s/ Michael Gray
	Name:	Michael Gray
	Title:	Director

[Signature Page to Securities Purchase Agreement]

EX-10.1

Exhibit 10.1

TWENTY-SEVENTH AMENDMENT TO AMENDED AND RESTATED

INTERACTIVE MARKETING AGREEMENT

This Twenty-Seventh Amendment to Amended and Restated Interactive Marketing Agreement (“Twenty-Seventh Amendment”) is entered into by and between AOL INC., a Delaware corporation (successor in interest to AOL LLC), with its principal place of business at 770 Broadway, New York, NY 10003 (“AOL”), and GOOGLE INC., a Delaware corporation (successor-in-interest to Google Inc., a California corporation) with offices at 1600 Amphitheatre Parkway, Mountain View, CA 94043 (“Google”), effective as of May 1, 2010 (the “Twenty-Seventh Amendment Effective Date”). AOL and Google may be referred to individually as a “Party” and collectively as the “Parties”.

INTRODUCTION

The Parties hereto wish to further amend that certain Amended and Restated Interactive Marketing Agreement effective as of October 1, 2003 (the “IMA”), as amended previously by that certain First Amendment to the Amended and Restated Interactive Marketing Agreement effective as of December 15, 2003 (the “First Amendment”), that Second Amendment to Amended and Restated Interactive Marketing Agreement effective as of March 30, 2004 (the “Second Amendment”), that Third Amendment to Amended and Restated Interactive Marketing Agreement effective as of April 7, 2004 (the “Third Amendment”), that Fourth Amendment to Amended and Restated Interactive Marketing Agreement effective as of June 1, 2004 (the “Fourth Amendment”), that Fifth Amendment to Amended and Restated Interactive Marketing Agreement effective as of June 14, 2004 (the “Fifth Amendment”), that Sixth Amendment to Amended and Restated Interactive Marketing Agreement effective as of December 17, 2004 (the “Sixth Amendment”), that Seventh Amendment to Amended and Restated Interactive Marketing Agreement effective as of March 28, 2005 (the “Seventh Amendment”), that Eighth Amendment to Amended and Restated Interactive Marketing Agreement effective as of April 28, 2005 (the “Eighth Amendment”), that Ninth Amendment to Amended and Restated Interactive Marketing Agreement effective as of December 15, 2005 (the “Ninth Amendment”), that Tenth Amendment to Amended and Restated Interactive Marketing Agreement effective as of March 24, 2006 (the “Tenth Amendment”), that Eleventh Amendment to Amended and Restated Interactive Marketing Agreement effective as of September 28, 2006 (the “Eleventh Amendment”), that Twelfth Amendment to Amended and Restated Interactive Marketing Agreement effective as of December 15, 2006 (the “Twelfth Amendment”), that Thirteenth Amendment to Amended and Restated Interactive Marketing Agreement effective as of January 12, 2007 (the “Thirteenth Amendment”), that Fourteenth Amendment to Amended and Restated Interactive Marketing Agreement effective as of February 16, 2007 (the “Fourteenth Amendment”), that Fifteenth Amendment to Amended and Restated Interactive Marketing Agreement effective as of March 2, 2007 (the “Fifteenth Amendment”), that Sixteenth Amendment to Amended and Restated Interactive Marketing Agreement effective as of September 24, 2007 (the “Sixteenth Amendment”), that Seventeenth Amendment to Amended and Restated Interactive Marketing Agreement effective as of February 29, 2008 (the “Seventeenth Amendment”), that Eighteenth Amendment to Amended and Restated Interactive Marketing Agreement effective as of March 31, 2008 (the “Eighteenth Amendment”), that Nineteenth Amendment to Amended and Restated Interactive Marketing Agreement effective as of April 30, 2008 (the “Nineteenth Amendment”), that Twentieth Amendment to Amended and Restated Interactive Marketing Agreement effective as of October 1, 2008 (the “Twentieth Amendment”), that Twenty-First Amendment to Amended and Restated Interactive Marketing Agreement effective as of November 1, 2008 (the “Twenty-First Amendment”), that Twenty-Second Amendment to Amended and Restated Interactive Marketing Agreement effective as of March 13, 2009 (the “Twenty-Second Amendment”), Twenty-Third Amendment to Amended and Restated Interactive Marketing Agreement effective as of December 4, 2009 (the “Twenty-Third Amendment”), Twenty-Fourth Amendment to Amended and Restated Interactive Marketing Agreement effective as of February 1, 2010 (the “Twenty-Fourth Amendment”), Twenty-Fifth Amendment to Amended and Restated Interactive Marketing Agreement effective as of March 1, 2010 (the “Twenty-Fifth Amendment”), Twenty-Sixth Amendment to Amended and Restated Interactive Marketing Agreement effective as of April 1, 2010 (the “Twenty-Sixth Amendment”), and that Addendum One to the Second Amendment to Amended and Restated Interactive Marketing

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Agreement dated October 5, 2004 (“Addendum One”) (the IMA and such amendments and addendum, collectively the “Existing Agreement” and the Existing Agreement together with this Twenty-Seventh Amendment, the “Agreement”). Capitalized terms not defined in this Twenty-Seventh Amendment shall have the meanings set forth in the Existing Agreement.

AGREEMENT

For good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereby amend the Existing Agreement as follows:

1. Interim Period. The Parties hereto agree to amend Section 1 of Twenty-Sixth Amendment by deleting the definition of Interim Period set forth therein in its entirety and replacing it with the following:

“Interim Period means the period of time beginning on the Spin-Off Date and ending on [****].”

2. Order of Precedence. This Twenty-Seventh Amendment is supplementary to and modifies the Existing Agreement. The terms of this Twenty-Seventh Amendment supersede provisions in the Existing Agreement only to the extent that the terms of this Twenty-Seventh Amendment and the Existing Agreement expressly conflict. However, nothing in this Twenty-Seventh Amendment shall be interpreted as invalidating the Existing Agreement, and provisions of the Existing Agreement shall continue to govern relations between the Parties insofar as they do not expressly conflict with this Twenty-Seventh Amendment. Furthermore, for the avoidance of doubt, any amendments or other changes made to any terms of the Existing Agreement under this Twenty-Seventh Amendment shall be interpreted to have full force and effect on any other relevant provisions of the Existing Agreement (including, but not limited to, Definitions, Exhibits, and Schedules related thereto), which reference or rely on such amended or changed terms.

3. Entire Agreement. This Twenty-Seventh Amendment constitutes the entire agreement with respect to the subject matter hereof. The Twenty-Seventh Amendment supersedes any other prior or collateral agreements, whether oral or written, with respect to the subject matter hereof.

4. Counterparts; Facsimile. This Twenty-Seventh Amendment may be executed in counterparts, each of which shall be deemed an original and all of which together shall constitute one and the same document. This Twenty-Seventh Amendment may be executed by facsimile.

IN WITNESS WHEREOF, the Parties have executed this Twenty-Seventh Amendment to the Existing Agreement.

AOL INC.		GOOGLE INC.
By:	/s/ Steven Quan	By:	/s/ Nikesh Arora
Name:	Steven Quan	Name:	Nikesh Arora
Title:	VP, Business Development	Title: President, Global Sales and Business Development
		Google Inc.
Date:	4/29/10	Date:	2010.04.29
		16:13:44-07’00’

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EX-10.2

Exhibit 10.2

TWENTY-EIGHTH AMENDMENT TO AMENDED AND RESTATED

INTERACTIVE MARKETING AGREEMENT

This Twenty-Eighth Amendment to Amended and Restated Interactive Marketing Agreement (“Twenty-Eighth Amendment”) is entered into by and between AOL INC., a Delaware corporation (successor in interest to AOL LLC), with its principal place of business at 770 Broadway, New York, NY 10003 (“AOL”), and GOOGLE INC., a Delaware corporation (successor-in-interest to Google Inc., a California corporation) with offices at 1600 Amphitheatre Parkway, Mountain View, CA 94043 (“Google”), effective as of June 1, 2010 (the “Twenty-Eighth Amendment Effective Date”). AOL and Google may be referred to individually as a “Party” and collectively as the “Parties”.

INTRODUCTION

The Parties hereto wish to further amend that certain Amended and Restated Interactive Marketing Agreement effective as of October 1, 2003 (the “IMA”), as amended previously by that certain First Amendment to the Amended and Restated Interactive Marketing Agreement effective as of December 15, 2003 (the “First Amendment”), that Second Amendment to Amended and Restated Interactive Marketing Agreement effective as of March 30, 2004 (the “Second Amendment”), that Third Amendment to Amended and Restated Interactive Marketing Agreement effective as of April 7, 2004 (the “Third Amendment”), that Fourth Amendment to Amended and Restated Interactive Marketing Agreement effective as of June 1, 2004 (the “Fourth Amendment”), that Fifth Amendment to Amended and Restated Interactive Marketing Agreement effective as of June 14, 2004 (the “Fifth Amendment”), that Sixth Amendment to Amended and Restated Interactive Marketing Agreement effective as of December 17, 2004 (the “Sixth Amendment”), that Seventh Amendment to Amended and Restated Interactive Marketing Agreement effective as of March 28, 2005 (the “Seventh Amendment”), that Eighth Amendment to Amended and Restated Interactive Marketing Agreement effective as of April 28, 2005 (the “Eighth Amendment”), that Ninth Amendment to Amended and Restated Interactive Marketing Agreement effective as of December 15, 2005 (the “Ninth Amendment”), that Tenth Amendment to Amended and Restated Interactive Marketing Agreement effective as of March 24, 2006 (the “Tenth Amendment”), that Eleventh Amendment to Amended and Restated Interactive Marketing Agreement effective as of September 28, 2006 (the “Eleventh Amendment”), that Twelfth Amendment to Amended and Restated Interactive Marketing Agreement effective as of December 15, 2006 (the “Twelfth Amendment”), that Thirteenth Amendment to Amended and Restated Interactive Marketing Agreement effective as of January 12, 2007 (the “Thirteenth Amendment”), that Fourteenth Amendment to Amended and Restated Interactive Marketing Agreement effective as of February 16, 2007 (the “Fourteenth Amendment”), that Fifteenth Amendment to Amended and Restated Interactive Marketing Agreement effective as of March 2, 2007 (the “Fifteenth Amendment”), that Sixteenth Amendment to Amended and Restated Interactive Marketing Agreement effective as of September 24, 2007 (the “Sixteenth Amendment”), that Seventeenth Amendment to Amended and Restated Interactive Marketing Agreement effective as of February 29, 2008 (the “Seventeenth Amendment”), that Eighteenth Amendment to Amended and Restated Interactive Marketing Agreement effective as of March 31, 2008 (the “Eighteenth Amendment”), that Nineteenth Amendment to Amended and Restated Interactive Marketing Agreement effective as of April 30, 2008 (the “Nineteenth Amendment”), that Twentieth Amendment to Amended and Restated Interactive Marketing Agreement effective as of October 1, 2008 (the “Twentieth Amendment”), that Twenty-First Amendment to Amended and Restated Interactive Marketing Agreement effective as of November 1, 2008 (the “Twenty-First Amendment”), that Twenty-Second Amendment to Amended and Restated Interactive Marketing Agreement effective as of March 13, 2009 (the “Twenty-Second Amendment”), Twenty-Third Amendment to Amended and Restated Interactive Marketing Agreement effective as of December 4, 2009 (the “Twenty-Third Amendment”), Twenty-Fourth Amendment to Amended and Restated Interactive Marketing Agreement effective as of February 1, 2010 (the “Twenty-Fourth Amendment”), Twenty-Fifth Amendment to Amended and Restated Interactive Marketing Agreement effective as of March 1, 2010 (the “Twenty-Fifth Amendment”), Twenty-Sixth Amendment to Amended and Restated Interactive Marketing Agreement effective as of April 1, 2010 (the “Twenty-Sixth Amendment”), Twenty-Seventh Amendment to Amended and Restated Interactive Marketing Agreement effective as of

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May 1, 2010 (the “Twenty-Seventh Amendment”), and that Addendum One to the Second Amendment to Amended and Restated Interactive Marketing Agreement dated October 5, 2004 (“Addendum One”) (the IMA and such amendments and addendum, collectively the “Existing Agreement” and the Existing Agreement together with this Twenty-Eighth Amendment, the “Agreement”). Capitalized terms not defined in this Twenty-Eighth Amendment shall have the meanings set forth in the Existing Agreement.

AGREEMENT

For good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereby amend the Existing Agreement as follows:

1. Interim Period. The Parties hereto agree to amend Section 1 of Twenty-Seventh Amendment by deleting the definition of Interim Period set forth therein in its entirety and replacing it with the following:

“Interim Period means the period of time beginning on the Spin-Off Date and ending on [****].”

2. Order of Precedence. This Twenty-Eighth Amendment is supplementary to and modifies the Existing Agreement. The terms of this Twenty-Eighth Amendment supersede provisions in the Existing Agreement only to the extent that the terms of this Twenty-Eighth Amendment and the Existing Agreement expressly conflict. However, nothing in this Twenty-Eighth Amendment shall be interpreted as invalidating the Existing Agreement, and provisions of the Existing Agreement shall continue to govern relations between the Parties insofar as they do not expressly conflict with this Twenty-Eighth Amendment. Furthermore, for the avoidance of doubt, any amendments or other changes made to any terms of the Existing Agreement under this Twenty-Eighth Amendment shall be interpreted to have full force and effect on any other relevant provisions of the Existing Agreement (including, but not limited to, Definitions, Exhibits, and Schedules related thereto), which reference or rely on such amended or changed terms.

3. Entire Agreement. This Twenty-Eighth Amendment constitutes the entire agreement with respect to the subject matter hereof. The Twenty-Eighth Amendment supersedes any other prior or collateral agreements, whether oral or written, with respect to the subject matter hereof.

4. Counterparts; Facsimile. This Twenty-Eighth Amendment may be executed in counterparts, each of which shall be deemed an original and all of which together shall constitute one and the same document. This Twenty-Eighth Amendment may be executed by facsimile.

IN WITNESS WHEREOF, the Parties have executed this Twenty-Eighth Amendment to the Existing Agreement.

AOL INC.		GOOGLE INC.
By:	/s/ Brian J. McMahon	By:	/s/ Nikesh Arora
Name:	Brian J. McMahon	Name:	Nikesh Arora
Title:	VP, Business Development	Title: President, Global Sales and Business Development
		Google Inc.
Date:	5/28/10	Date:	2010.06.01
		10:04:34-07’00’

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EX-10.3

EXHIBIT 10.3

Execution Version

Confidential

SEARCH SERVICES AGREEMENT

This Search Services Agreement (the “Agreement”), dated as of September 1, 2007 (the “Effective Date”), is between AOL LLC (“AOL”), a Delaware limited liability company, with offices at 22000 AOL Way, Dulles, Virginia 20166, and CNN Interactive Group, Inc. (hereinafter “CNN”), a Delaware corporation, with offices at One CNN Center, Atlanta, GA 30303. AOL and CNN may be referred to individually as a “Party” and collectively as the “Parties.”

INTRODUCTION

WHEREAS, AOL licenses from its Third Party Provider the right to receive web search functionality, Sponsored Link results from Advertisers, and certain branding rights and the right to provide such rights and services to Affiliates of Time Warner Inc.;

WHEREAS, AOL provides an Internet based program for directing Internet search engine users to a landing page of sponsored links relevant to the users’ search queries through the use of Result Terms or AOL Hand Mapped Terms (i.e., “Web Offers Links”);

WHEREAS, AOL wishes to provide and CNN, as an Affiliate of Time Warner Inc., wishes to receive through AOL the Web Service, the Sponsored Advertising Service and the Web Offers Links on CNN.com, along with certain Third Party Provider branding rights;

WHEREAS, this relationship is further described below and is subject to the terms and conditions set forth in this Agreement;

NOW THEREFORE, in consideration of the foregoing and the mutual promises contained herein, the Parties hereby agree as follows:

Defined terms used but not defined in the body of the Agreement shall be as defined on Exhibit A attached hereto.

TERMS

1. SERVICES

1.1. Sponsored Links. Subject to the terms and conditions of this Agreement, AOL shall enable CNN.com to request, and AOL will ensure that the Third Party Provider provides, Matched Results for display as Sponsored Links in the Sponsored Links Search Results Area throughout the Term (and where CNN is required to provide notice pursuant to this Agreement with respect to increase, elimination or suspension of the Matched Results and/or Additional Matched Results, CNN will comply with such notice requirement).

1.2. Web Search. Subject to the terms and conditions of this Agreement, AOL shall enable CNN.com to receive the Web Services and Licensed Content.

1.3. Web Offers. Subject to the terms and conditions of this Agreement, AOL shall enable CNN.com to receive the Web Offers Links.

2. IMPLEMENTATION, MECHANICS AND PROCESS.

2.1. Sponsored Link Implementation. Subject to the terms of this Agreement, AOL shall make available to CNN and CNN.com Users the Sponsored Advertising Service as set forth herein, and subject to Section 2.4, CNN shall use the protocol in Schedule 2.1 (on the terms set forth therein, including Preamble thereto) (the “Protocol”) to: (a) enable CNN.com Users who query the CNN Search Service (from CNN .com) to receive the results of those Queries (including the Sponsored Links) on the Sponsored Links Search Results Area (i.e., within CNN.com), (b) provide tag(s) within the request for Matched Results indicating the number of Matched Results requested and whether the Matched Results will be displayed on First Pages or Next Pages, and (c) subject to CNN’s rights under this Agreement, serve the Matched Results in the form of Sponsored Links in response to the CNN.com User Queries.

2.1.1. Sponsored Links Required Characteristics. Unless changed pursuant to Section 2.1.2 or otherwise changed by mutual agreement of the Parties during the Term, all Sponsored Links will include the characteristics set forth in this Section 2.1.1 (such characteristics, collectively, the “Sponsored Links Required Characteristics”): The Sponsored Links shall (i) include at least three (3) Matched Results above the Web Search Results Area on the First Pages of CNN.com, and at least two (2) Matched Results on the Next Pages of CNN.com (to the

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extent a sufficient number of Matched Results are delivered; if fewer than the number of Matched Results specified above are delivered, CNN shall serve the number of Matched Results delivered by the Third Party Provider, subject to CNN’s rights hereunder); (ii) be titled “Sponsored Links” unless otherwise agreed upon by the Parties in writing; (iii) at CNN’s option, include AOL-approved “mouse-overs” on the Sponsored Links on CNN.com (i.e., text that appears when the mouse sits on top of such title); (iv) include the following disclosure language (or substantially similar language as agreed upon by AOL and CNN) in relation to the group of Sponsored Links: “These listings are brought to you by a third party and are not necessarily endorsed by CNN” (in a font size similar to any other similar disclaimers on the same page or in accordance with CNN.com’s generally applicable disclaimer policies); and (v) appear materially similar to the mock-ups attached hereto as Exhibit H, or as otherwise mutually agreed. With respect to subpart (i) above: (x) the Parties expressly agree that CNN shall have the right to implement certain Additional Matched Results in compliance with Exhibit F hereto, as further referenced in Section 9 below; and (y) in situations where CNN faces risk of imminent harm (e.g., including without limitation, in the event of a virus transmission, ongoing misuse of user data, or any Sponsored Link Excess Slippage (defined below)) which is material, CNN may eliminate or suspend the display of the Matched Results and shall only be required to deliver written notice promptly following the elimination or suspension of Matched Results.

2.1.2. Redesigns. Notwithstanding anything to the contrary herein, CNN expressly reserves the right to redesign or modify the organization, structure, “look and feel,” navigation and other elements of any part or all of CNN.com, but excluding the text or Content of the Matched Results as provided by the Third Party Provider through AOL (“Redesigns”) at any time without notice to or consent from AOL, provided, however, if a Redesign to either the Sponsored Links Search Results Area or the Web Search Results Area causes the click-through rate (“CTR”) for Sponsored Links to decline by an average of twelve percent (12%) during the fifteen (15) days following the Redesign (versus the average during the thirty (30) days preceding the Redesign), AOL shall, at any time after such Redesign, notify CNN in writing of such decline (with e-mail being sufficient) and the Parties shall meet within three (3) business days of such notice to determine whether the decline in CTR was caused by the Redesign and if so, then to work together in good faith to agree on how to restore the CTR, as applicable, to the level that existed prior to the Redesign. If the Parties are unable to agree on how to restore the CTR, as applicable, to the level that existed prior to the Redesign then the Parties shall escalate such matter for further discussion to the Management Contacts identified in Section 1 of Exhibit E.

2.1.3. General Mechanics. This Section describes the general processes by which CNN will submit Queries to AOL and requests for Matched Results for display as Sponsored Links, and the Third Party Provider, through AOL, will deliver Matched Results to CNN, in accordance with the terms of this Agreement. Subject to Section 2.4, when CNN.com Users initiate a search on the CNN Search Service (whether through a Query or from a link within a category or subcategory or otherwise) then CNN will deliver the Search Term (if the search is initiated from a link within a category, then CNN will deliver the corresponding Search Term) to the Third Party Provider (subject to CNN’s rights to decline to send a particular Search Term pursuant to Section 2.9) and a request for Matched Results. The Third Party Provider shall receive and process the Search Term, including selecting Matched Results that satisfy the Search Term and this Agreement (e.g., including without limitation the filtering requirements of Section 2.8). The Third Party Provider then shall deliver to CNN, via a means and format agreed upon by AOL and CNN, an XML data feed that includes up to the specified number of Matched Results set forth in Section 2.1.1 above or a “no result” notice. CNN shall parse the data feed as appropriate and display all the provided Matched Results (again subject to its rights to decline pursuant to Section 2.9 and subject to not receiving more than the number of Matched Results as set forth in Section 2.1.1) as Sponsored Links. All Sponsored Links shall contain mutually agreed Linking Mechanisms. The Sponsored Links shall be the highest-ranked qualifying Matched Results provided by the Third Party Provider (subject to the applicable filtering and blocking rules), provided, however, that the Parties may mutually agree otherwise with respect to the Next Pages.

2.2. Web Search Implementation. AOL shall enable CNN to receive the Licensed Content and the Web Service for inclusion in, and use on, CNN.com and as otherwise set forth in this Agreement. Traffic on all Service Pages shall be considered to be CNN traffic. The Web Service will be provided by the Third Party Provider, in all material respects, in accordance with the functionality, specifications, performance criteria and limitations specified in or referenced in this Agreement, including in Exhibit B-1 attached hereto, or as otherwise agreed upon in writing by the Parties.

2.2.1. Service Pages. The Service Pages shall: (i) be served, produced and managed by, or for CNN co-branded sites on behalf of, CNN, except as otherwise agreed in writing by the Parties; (ii) be hosted and maintained solely on CNN’s servers (excluding the Search Engine and other Third Party Provider Technology), except as otherwise agreed in writing by the Parties; and (iii) have a domain name determined at CNN’s sole discretion.

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2.2.2. General Mechanics. All Queries to the Web Service sent by CNN to the Third Party Provider shall use a Client Name and a Valid IP Address provided by CNN to AOL and the Third Party Provider, where “Client Name” means an alphanumeric code assigned to CNN by the Third Party Provider, and “Valid IP Address” means any and all valid Internet protocol addresses that will be used by or on behalf of CNN.com. Any modifications to the initial list of Valid IP Addresses provided to AOL by CNN must be made by CNN. When CNN.com Users initiate a search on CNN.com in an area where CNN utilizes the Web Service, then CNN shall deliver such Queries to the Third Party Provider, subject to CNN’s rights to decline to send particular Queries pursuant to Section 2.9. The Third Party Provider shall receive and process the Queries, including generating the Results Set(s). The Third Party Provider then shall deliver to CNN the XML data feed that includes Results Set(s) or a “no result” notice. CNN shall parse the XML data feed to display, subject to the terms of this Agreement. CNN shall not alter the text of the Search Results, except that CNN may reformat, change the look and feel, and display only a portion of the Search Results, and may commingle and/or intermittently intersperse the Search Results with other search results (paid or unpaid, of CNN, its Affiliates and/or third parties), provided however, that in all cases CNN does not display the Search Results (whether or not commingled) in a different order or ranking than received. The Parties acknowledge and agree that nothing contained in this Section 2.2.2 is intended to negate or amend the restrictions placed on CNN set forth in Section 4 (Exclusivity) of this Agreement. CNN may limit the number of Results Sets returned per Query.

2.2.3. Web Service Implementation. AOL shall ensure that the Database is updated in a manner consistent with the descriptions set forth in Exhibit B-1. Subject to Section 2.1.2 above, CNN shall be responsible for the design, production, technology deployment, Content programming, and creation of graphic user interfaces of the Web Service as appearing within any area of CNN.com hereunder, and may in its sole discretion determine and limit the number of Search Results appearing in the Web Search Results Area and the size of each Search Result, in each case, as appearing within any area of CNN.com. The Web Service shall perform substantially in accordance with the then most-current performance standards of the most-current version of the Third Party Provider’s search service used by AOL that is similar to the Web Service (except (a) to the extent that this Agreement, including Exhibit B-1, provides for differences from such version and, (b) for the Database size limitations set forth on Exhibit B-1, and (c) to the extent that CNN and AOL select different filtering options in accordance with the Data Protocol), but in all cases otherwise in accordance with the requirements set forth in Exhibit B-1. CNN shall provide AOL with (i) at least forty (40) days notice of an expected increase in the daily average volume of Queries to the Web Service from CNN.com, of ten percent (10%) and up to thirty percent (30%), measured against the rolling thirty (30)-day average Query volume, (ii) at least ninety (90) days notice of an expected increase in the daily average volume of Queries to the Web Service from CNN.com, of thirty percent (30%) and up to fifty percent (50%), measured against the rolling thirty (30)-day average Query volume, and (iii) a mutually agreed notice period (acting reasonably in good faith) of an expected increase in the daily average volume of Queries to the Web Service from CNN.com, of fifty percent (50%) or greater, measured against the rolling thirty (30)-day average Query volume, provided however, that neither (x) failure to send such notice to AOL, nor (y) any lack of a change of volume (or other inaccuracy of the predicted volume change) after having sent such a notice to AOL shall be deemed a breach of, or otherwise result in liability to, CNN pursuant to the terms of this Agreement, but provided further, that in the event CNN fails to send such a notice, then AOL shall be under no obligation to meet the requirements set forth in Sections 1-3 of the Technical Requirements set forth in Exhibit B-1 attached hereto with respect to Queries for a period of thirty (30) days, ninety (90) days, or more, as applicable, from the date that such increase first occurred

2.3. Web Offers Links.

2.3.1. Web Offers Links Required Characteristics. Unless changed pursuant to Section 2.1.2 or otherwise changed by mutual agreement of the Parties during the Term, all Web Offers Links will include the characteristics set forth in this Section 2.3.1 (such characteristics, collectively, the “Web Offer Required Characteristics”): CNN shall include the Web Offers Links above the Web Search Results Area on the First Pages of CNN.com and may display Web Offers Links below the Web Search Results Area on the First Pages of CNN.com. CNN will only be required to display such number of Web Offers Links that can be displayed within two (2) lines of text. In addition, CNN may display Web Offers Links on the Next Pages, provided that the Web Offers Links are displayed in a manner similar to how they are displayed on the First Pages. In situations where CNN faces risk of imminent harm (e.g., including

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without limitation, in the event of a virus transmission, ongoing misuse of CNN.com User data, or any Sponsored Link Excess Slippage (defined below)) which is material, CNN may eliminate or suspend the display of Web Offers Links and shall only be required to deliver written notice promptly following the elimination or suspension of any Web Offers Links.

2.3.2. General Mechanics. When CNN.com Users initiate a search on the CNN Search Service (whether through a Query or from a link within a category or subcategory or otherwise) then subject to Section 2.4, CNN will deliver the Search Term (if the search is initiated from a link within a category, then CNN will deliver the corresponding Search Term) to AOL (subject to CNN’s rights to decline to send a particular Search Term pursuant to Section 2.9) and a request for Web Offers Links. AOL shall receive and process the Search Term, including selecting Web Offers Links that satisfy the Search Term and this Agreement (e.g., including without limitation the filtering requirements of Section 2.8). AOL then shall deliver to CNN, via a means and format agreed upon by AOL and CNN, an XML data feed that includes no more than the number of Web Offers Links that can be displayed within two (2) lines of text as set forth in Section 2.3.1 above. CNN shall parse the XML data feed as appropriate and display all the provided Web Offers Links (again subject to its rights to decline pursuant to Section 2.9). The Web Offers Links will direct CNN.com Users to the Web Offers Landing Page, which will reside in a CNN template, as agreed upon by the Parties.

2.4. Vertical Searches. Notwithstanding anything to the contrary herein, including, without limitation, the terms of Sections 2.1, 2.1.3 and 2.3.1, CNN may, but shall not be obligated to, implement the Sponsored Advertising Service, including Sponsored Links or Web Offers Links, with Vertical Searches (e.g., CNN could implement a Vertical Search in the travel category on CNN.com and not display Sponsored Links on the page that displays the results of the travel queries which results are provided by a third party). If, however, CNN elects to implement the Sponsored Advertising Service, including Sponsored Links or Web Offers Links, with Vertical Searches pursuant to this Section 2.4, CNN may not use any other paid search results within those Vertical Searches while using the Sponsored Advertising Service (including Sponsored Links or Web Offers Links). In addition, if CNN implements Vertical Searches on CNN.com using the same search box as it uses for web search or Site Search, it will make web search using the Web Service or Site Search the default search service in such search box on all CNN.com pages where such search box appears. For example, CNN may not categorize a query in the search box for web search or Site Search on CNN.com pages as “travel” and send such searches to CNN’s travel vertical experience, but CNN may, however, use Vertical Searches on the same search box that it uses for web search and/or Site Search if such Vertical Search is not the default search and is accessed by some means such as being triggered by a CNN.com User toggling over to a vertical tab (like “Shopping” or “Travel”) on the main search box.

2.5. Speed of Matched Results. Notwithstanding anything to the contrary herein, AOL will ensure that every Matched Result is fully queried, matched, processed, and delivered and received by CNN (including a complete http response, with a complete Matched Results Set result or a “no hit” set result served in XML format) (collectively, “Fully Processed and Served”) in less than one (1) second from the time the initial query is delivered to AOL or the Third Party Provider, as applicable, from CNN (i.e., the CNN server) (the “Maximum Delivery Time”). In the event that the Third Party Provider fails to Fully Process and Serve any individual Matched Result within the Maximum Delivery Time (“Timing Out”), then in addition to any other remedies available to CNN, CNN shall not be obligated to display any such individual Matched Results that take longer than the Maximum Delivery Time to be Fully Processed and Served (e.g., CNN may elect to “time out” or filter such Matched Results from the Sponsored Links).

2.6. Branding. Notwithstanding anything to the contrary, CNN shall not be obligated to display any branding of AOL or the Third Party Provider in connection with this Agreement. Notwithstanding the previous sentence, AOL hereby grants to CNN the right to use the branding of the Third Party Provider on CNN.com as depicted in the mock-ups attached hereto as Exhibit I and as otherwise mutually agreed.

2.7. Ownership. Subject to AOL and the Third Party Provider’s rights in the Sponsored Advertising Service and the Advertising Results (as applicable), and subject further to the rights of any of Advertisers in their advertisements, trademarks, and websites, CNN owns and (as between AOL and CNN) shall operate the CNN Search Service, and CNN owns all right, title and interest in and to CNN.com and all advertising and promotional spaces therein (including, without limitation, the Service Pages on which the Advertising Results appear via the Sponsored Links as set forth herein), including all frames and other tools or navigation associated therewith.

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2.8. Sponsored Links Promotional Limitations.

(a) First Level Filter. AOL shall implement a list for CNN.com of URLs and Search Terms that when queried, are more likely than not to produce search results that: (a) are pornographic, or that link to sites offering pornography; (b) would obviously link to a website that offers for sale an illegal substance, product or service; (c) are contrary to CNN’s written advertiser policy(ies); (d) CNN is prohibited from displaying within a service such as the Sponsored Links, because of a pre-existing (as of the Effective Date) agreement between CNN and a third party; or (e) are subject to the Second Level Filter (as defined in Section 2.8(b)) below, including any updates thereto as permitted under Section 2.8(c) below, in order to prevent such results during periods during which such updates are being implemented or generally to limit Second Level Failure (collectively, the “Sponsored Link First Level Filter”) (clauses (a) through (e) above, the “Sponsored Link First Level Filter Rules”). The Parties hereby agree that the Sponsored Link First Level Filter for CNN.com shall initially include the URLs and Search Terms from AOL’s current filters with the Third Party Provider, as provided to CNN in writing prior to the execution of this Agreement and as amended and updated by AOL during the Term (and provided to CNN.com in writing, with email being sufficient). CNN may update the Sponsored Link First Level Filter at any time during the Term (as provided in Section 2.8(c) below, AOL shall use commercially reasonable efforts not to provide, or have the Third Party Provider provide, any Matched Results for the Search Terms or URLs included in the Sponsored Link First Level Filter; provided that the existence of a Matched Result that should have been excluded by the Sponsored Link First Level Filter (“Sponsored Link First Level Failure”) will not be deemed a breach of the Agreement. Instead, AOL shall remedy the Sponsored Link First Level Failure as set forth in Section 2.9. The lists referenced in this Section 2.8(a) above will be specific to CNN.com.

(b) Second Level Filter. AOL shall use commercially reasonable efforts to, and CNN shall assist AOL to, create (i) a filter that includes Search Terms (which shall be deemed to include reasonably likely misspellings), Prohibited Entities and URLs (which shall be deemed to include reasonably applicable sub-URLs) for Prohibited Entities (“Prohibited Entities” shall mean those companies described on the Prohibitied Entities List (defined below)) and (ii) processes, including editorial review and post-incident instructions for removal of slippage, as applicable (as described below), to exclude the following from the Matched Results: Matched Results that (a) are contrary to certain applicable standard advertiser policies (as delivered to AOL in writing, which writing may be in the form of an email) which are selected by CNN from CNN’s generally applicable standard advertiser policies for CNN.com (as such selections may be updated by CNN from time to time); (b) link to a portion of a Prohibited Entity’s website on which is described or offered any product or service that CNN or its parent, Turner Broadcasting System, Inc., markets as part of one of its core businesses; or (c) promote, market, offer or distribute products or services which CNN identifies to AOL in writing (which writing may be in the form of an email) that CNN does not desire to display or distribute (for any reason as determined by CNN in its sole discretion); (collectively, the “Sponsored Link Second Level Filter”) (clauses (a), (b) and (c) above, the “Sponsored Link Second Level Fiter Rules” and, together with the Sponsored Link First Level Filter Rules, the “Sponsored Link Filter Rules”). The initial list of Prohibited Entities is attached hereto as Schedule 1 (the “Prohibited Entities List”) which such list may be updated upon mutual agreement between AOL and CNN and shall in any case be deemed to include reasonable variations, misspellings and singulars and plurals thereof. Through the Sponsored Link Second Level Filter, AOL is responsible for implementing CNN’s filtering rules that might be context dependent or subject to interpretation. For example, if the Search Term within the Sponsored Link Second Level Filter is “guns” and CNN’s policy forbids (or CNN does not desire to display or distribute) the sale of guns but permits (or otherwise does not object to) Content related to gun control or gun safety, then AOL would ensure that the Matched Results exclude links to Advertiser Websites selling guns, but would be permitted (but not required) to provide links to Advertiser Websites containing Content about gun control issues. The Parties hereby acknowledge that CNN has provided the Search Terms and Prohibited Entities that are initially included in the Sponsored Link Second Level Filter as of the Effective Date; thereafter CNN may update the Sponsored Link Second Level Filter as set forth in Section 2.8(c) below. AOL shall exclude from Matched Results any items covered by the Sponsored Link Second Level Filter; provided that the existence of a Matched Result that should have been excluded by the Sponsored Link Second Level Filter (“Sponsored Link Second Level Failure”) will not be deemed a breach of the Agreement. Instead, AOL shall remedy the Sponsored Link Second Level Failure as set forth in Section 2.9.

(c) Updates to First Level Filter and Second Level Filter. CNN may update the Sponsored Link First Level Filter and/or the Sponsored Link Second Level Filter and/or the Sponsored Link Second Level Filter Rules (including the Prohibited Entities List, upon mutual agreement with AOL, which will not be unreasonably withheld or delayed) at any time by providing written notice (which written notice may be in the form of email) to AOL of the Search Term, the URLs, standard advertiser policy, or the entity that should be included, and, for a Search Term, whether that Search Term should be included on the Sponsored Link First Level Filter or on the Sponsored Link Second Level Filter. Any updates must be consistent with the definitions and restrictions and rights (in the Sponsored Link First Level Filter Rules

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and Sponsored Link Second Level Filter Rules, as applicable) above, but may also include Search Terms, URLs, entities or policies that CNN reasonably and in good faith believes are necessary for inclusion to prevent (a) exposure of CNN to liability or (b) adverse effects to CNN, CNN.com, or the CNN.com User experience (including, without limitation, to brand and/or editorial independence or integrity). For updates to the Sponsored Link First Level Filter, AOL shall implement such updates, as soon as practicable, but in any event within two (2) Business Days from delivery of such written notice. For updates to the CNN standard advertising policies subject to the Sponsored Link Second Level Filter or for products or services subject to Section 2.8(b)(ii)(c), AOL shall implement such updates as soon as practicable, but in any event within six (6) Business Days from delivery of such written notice (unless such updating requires the manual review of a material portion of the Third Party Provider’s database of existing advertisements, in which case AOL shall implement such updates as soon as practicable, but in any event within a period of time not to exceed twenty-one (21) Business Days).

(d) Relevance. All Advertising Results shall be Relevant to the applicable Search Term. If CNN reasonably believes that a particular Matched Result is not Relevant, then in addition to CNN’s other rights under this Agreement, CNN shall have the rights in Section 2.9(a) to block, and may inform AOL, in which case AOL shall consider that Matched Result not to be Relevant, and shall exclude it as a Matched Result within the time set forth in Section 2.9

2.9. Rights and Remedies in the Event of Sponsored Links Promotional Problems

(a) CNN Right to Block. Notwithstanding any notice requirements elsewhere in this Agreement, CNN has the right, but not the obligation, to do any of the following: (a) decline to send a Query to AOL or the Third Party Provider (as applicable) that reasonably would produce an Excluded Result because the Search Term is on the Sponsored Link First Level Filter or Sponsored Link Second Level Filter, (b) remove, or decline to serve and display any Sponsored Links if CNN reasonably believes that the Matched Results being returned that are Excluded Results pursuant to the Sponsored Link First Level Filter or Sponsored Link Second Level Filter, or (c) remove, or decline to serve and display any Sponsored Links if CNN reasonably believes that Matched Results being returned are not Relevant. In the event that CNN notifies AOL in writing (which writing may be in the form of an email) of a Search Term or Search Result that should have been filtered under the Sponsored Link Filter Rules, such notice shall constitute a request to update the Sponsored Link First Level Filter or the Sponsored Link Second Level Filter, for which AOL shall take action pursuant to Section 2.8(c). CNN may continue to decline to send a Search Term and/or block the display of Sponsored Links until AOL advises CNN that AOL has adequately updated the filters or has otherwise remedied the problem.

(b) Slippage. The Parties acknowledge and agree that there will be minor occasions where Matched Results are not filtered out in accordance with Section 2.8 despite the commercially reasonable efforts of AOL and Third Party Provider (“Sponsored Link Slippage”), and in such event, the Parties will cooperate to remedy the situation as quickly as possible in a mutually agreed manner. Any immaterial and occasional Sponsored Link Slippage alone will not be deemed a material breach hereof; provided that AOL remedies such problems promptly; and provided further that CNN shall retain its rights to block as set forth in Section 2.9(a) above. If CNN determines that, in its reasonable judgment, the Matched Results include Excluded Results, whether or not such Sponsored Link Slippage is material, then CNN may provide written notice to AOL (during business hours such notice should be provided to both Joan.kickert@corp.aol,com and Scott.Knowles@corp.aol,com, after business hours (for urgent escalations) such notice should be provided to the AOL Network Operations Center via telephone at (703) 265-4662, or such other contacts as otherwise provided by AOL to CNN)(which written notice may be in the form of email). The notice must describe the Search Term, prohibited entity, or Advertiser Website affected, and the basis of the determination that it is an Excluded Result. AOL shall then remedy the problem by ceasing to provide, or having the Third Party Provider cease to provide, them as part of the Matched Results, as soon as reasonably possible, but no later than within three (3) Business Days from delivery of such written notice for Search Terms on the Sponsored Link First Level Filter, and seven (7) Business Days from delivery of such written notice for the Sponsored Link Second Level Filter. In the event that the quantity or frequency of Sponsored Link Slippage is becoming more than minor in scope or amount (including due to repetitive problems) (“Sponsored Link Excess Slippage”), CNN shall provide written notice thereof to AOL at any time. In the event that CNN notifies AOL of Sponsored Link Excess Slippage, senior account services representatives, or such other personnel as may reasonably be expected to be necessary to remedy the situation, from each Party, will work together in good faith for the five (5) day period commencing on the date of such notice. If AOL is unable to cure such Sponsored Link Excess Slippage within such five (5) day period, then CNN shall notify AOL in writing of such failure and, notwithstanding anything to the contrary, the Sponsored Link Slippage which is subject to such notice may constitute a material breach hereof, in which case such notice shall constitute CNN’s notice to AOL with respect to such material breach (and shall be deemed retroactive to the commencement of such five (5) day period).

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2.10. Web Search Limitations

(a) Keyword Filter. CNN may, and upon request from CNN, AOL will assist CNN to, create a list of Queries for the Web Service (a “Keyword List”), such list including the most common misspellings, that when queried, are more likely than not to produce search results that (a) are pornographic, or that link to sites offering pornography; (b) would obviously link to a website that offers for sale an illegal substance, product or service; (c) are contrary to CNN’s written advertiser policy(ies); (d) CNN is prohibited from displaying because of a pre-existing (as of the Effective Date) agreement between CNN and a third party; (e) could expose CNN to liability or have a negative impact on CNN (as determined by CNN in good faith); or (f) CNN reasonably believes in good faith could adversely affect CNN, CNN.com, or the CNN.com User experience (clauses (a) through (f) above, the “Web Search Filter Rules”) (collectively, the “Keyword Filter”). AOL shall remedy any failure of the Keyword Filter to exclude a Search Result that should have been excluded by the Keyword Filter as set forth in Section 2.10(g). Pursuant to Section 2.10(d) the initial Keyword Filter for CNN.com shall include AOL’s current Keyword Filter with the Third Party Provider.

(b) URL Filter. CNN may, and upon request from CNN, AOL will assist CNN to, create a list of URLs for the Web Service (a “URL List”) that could violate the Web Search Filter Rules to be excluded from Results Sets. AOL shall use commercially reasonable efforts to ensure that no Search Results (for the Web Service) provided are exact matches to the URLs or image URLs included in the URL filter list. AOL shall remedy any failure of the URL filter to exclude a Search Result that should have been excluded by the URL filter as set forth in Section 2.10(g). The Keyword Filter and the URL filter may hereinafter collectively be referred to as the “Web Search Filters.” Any Search Results or Results Set that could be filtered by the Web Search Filters shall be deemed a “Restricted Result.” Pursuant to Section 2.10(d) the initial URL filter for CNN.com shall include AOL’s current URL filter with the Third Party Provider.

(c) Technical Support. AOL will provide and ensure that CNN receives technical support to ensure that the Licensed Content is correctly received by CNN in accordance with the priority response times and terms and conditions set forth in Exhibit B-2. AOL shall appoint a technical contact to whom CNN may address all technical questions relating to the Web Service, and AOL shall use commercially reasonable efforts to remedy, or have its Third Party Provider remedy, any material malfunctioning of the Web Service in accordance with Exhibit B-2. As between AOL and CNN, AOL shall be solely responsible for the license, purchase, implementation, maintenance and support of all software and hardware required to fulfill its obligations under this Agreement. In the event that CNN technical support is required for the Web Service as implemented on CNN.com, CNN will provide reasonable technical support to AOL free of charge upon mutually acceptable terms and conditions.

(d) Updates to Keyword Filter and URL Filter. The Parties hereby agree that the initial Web Search Filters for CNN.com shall include AOL’s current filters with the Third Party Provider, as provided to CNN in writing prior to the execution of this Agreement and as amended and updated by AOL during the Term (and provided to CNN.com in writing, with email being sufficient). CNN may update the Web Search Filters at any time by providing written notice to AOL of the Query or URL and the applicable list in a manner and form to be mutually agreed. Any updates must be consistent with the definitions and restrictions and rights (in Web Search Filter Rules) above. AOL shall implement such updates to the Web Search Filters within three (3) Business Days. Notwithstanding the foregoing, if CNN requests that AOL block Content that is illegal or offers for sale an illegal substance, then AOL shall use commercially reasonable efforts to block the relevant URL(s) or image URL(s) within eighteen (18) hours from all Search Results (and in any case within two (2) calendar days), whether or not relevant Web Search Filters are in place.

(e) Relevance. The first Results Set shall be Relevant to the applicable Query. If CNN reasonably believes in good faith that a particular Query is being responded to with an initial Results Set that is not Relevant, then CNN shall have the rights in Section 2.10(f) to block, and may inform AOL, in which case AOL shall consider that Results Set not to be Relevant, and shall be deemed to be an Error, subject to Exhibit B-2.

(f) CNN Right to Block. Notwithstanding anything to the contrary, CNN shall have the right, but not the obligation, to (a) decline to send a Query to AOL or the Third Party Provider (as applicable) that reasonably would produce Restricted Results, adult or explicit results, results that are not Relevant, and/or results that are Timing Out (per Exhibit B-1), (b) decline to serve or display any Search Results if Search Results are not delivered to CNN in conformity with the Web Search Filter Rules, that is not

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Relevant, and/or that is Timing Out (per Exhibit B-1), and/or adult or explicit results, and/or (c) decline to display a resulting web page when a CNN.com User clicks on a Search Result that is a Restricted Result.

(g) Slippage. The Parties acknowledge and agree that there will be minor occasions where Search Results are not filtered by the Filters in accordance with this Section 2.10(g) despite commercially reasonable efforts of AOL (“Web Search Slippage”), and in such event, the Parties will cooperate to remedy the situation as quickly as possible in a mutually agreed manner. Any immaterial and occasional Web Search Slippage alone will not be deemed a material breach hereof; provided that AOL remedies such problems in accordance with this Section 2.10(g) and Exhibit B-2; and provided further that CNN shall retain its rights to block as set forth in Section 2.10(f) above. If CNN determines that in its reasonable judgment the Web Search Filters are not filtering properly, then CNN may provide written notice to AOL (during business hours such notice should be provided to both Joan.kickert@corp.aol.com and Scott.Knowles@corp.aol.com, after business hours (for urgent escalations) such notice should be provided to the AOL Network Operations Center via telephone at (703) 265-4662, or such other contacts as otherwise provided by AOL to CNN). The notice must describe the Query or URL and the basis of the determination. AOL shall then remedy the problem as follows: for issues relating to the Web Search Filters, AOL shall have the Web Search Filter fixed as a Severity 1 Error subject to Exhibit B-2. In the event that the quantity or frequency of Web Search Slippage is becoming material in scope or amount (including due to repetitive problems), as determined by CNN in good faith, such may constitute a material breach hereof, subject to the standard process therefore.

(h) Use of Service. Notwithstanding anything herein to the contrary, CNN is in no way restricted by this Agreement in distributing and using the Web Service throughout CNN.com. CNN may cache Search Results obtained in connection with the provision of the Web Service to CNN.com Users, provided that (a) CNN’s servers communicate to the servers of the Third Party Provider the number of Queries performed against the cached results (provided that the Parties shall mutually agree on the mechanics and implementation thereof, including without limitation appropriate increases to the response times set forth on Exhibit B-1), (b) the limitations set forth in Section 2.10 herein apply to the cached results only insofar as such limitations existed at the time the results were cached; and (c) the limitations set forth in Section 2.10 herein are required for the cached results only insofar as the cached results are used to obtain Results Sets for Queries sent with the same filter identifier as the Query that caused the creation of the cached results.

(i) AOL and Third Party Provider Proprietary Rights. CNN acknowledges and agrees that CNN owns no right, title and interest in and to the Search Results, the Third Party Provider’s Search Engine and the Third Party Provider Technology (including any software or other technology licensed by third parties to AOL or the Third Party Provider), including without limitation any and all Intellectual Property Rights therein, and that CNN shall not acquire any right, title or interest in or to the Search Results, the Third Party Provider’s Search Engine and the Third Party Provider Technology, except as expressly set forth in this Agreement. CNN shall not modify, adapt, translate, prepare derivative works from, decompile, reverse engineer, disassemble or otherwise attempt to derive source code from any AOL or Third Party Provider software or documentation, including without limitation the Third Party Provider’s Search Engine and the Third Party Provider Technology.

(j) CNN.com Data. As between AOL and CNN, AOL acknowledges and agrees that CNN own(s) all right, title and interest in and to the data generated on or by use of CNN.com, including without limitation (and as applicable) the following: all CNN.com User personal identification and site behavioral data; CNN.com User demographic and psychographic data; CNN.com User input data, preferences and Queries; CNN.com User advertising and search result click-through data; and any information derived therefrom, in each case including without limitation any and all Intellectual Property Rights therein (together, the “Service Data”), and that neither AOL nor the Third Party Provider shall acquire any right, title, or interest therein or thereto. Notwithstanding the foregoing, to the extent any of the Service Data include any Search Results, the portion of such Service Data which is Search Results (and only such data) is and shall remain the sole property of AOL, subject to the rights granted to CNN pursuant to this Agreement. AOL and the Third Party Provider may use the Search Results and search result clickthrough data to improve the Web Service or the Third Party Provider’s search algorithms so long as such data (a) is aggregated with other data from services operated by AOL or the Third Party Provider, (b) is not specifically identified as having been obtained from CNN, any CNN.com User of the Web Service and (c) is not used to target or to create a profile of any CNN.com Users of the Web Service; or (iii) for other purposes with the prior written consent of CNN in its sole discretion. The Parties acknowledge that each Party intends that no personally identifiable information shall be

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collected by AOL or the Third Party Provider or conveyed by CNN to AOL or the Third Party Provider via the Web Service. Both Parties further acknowledge that data regarding any user of the Web Service (e.g. mailing lists etc.) could be obtained by either Party through activities unrelated to this Agreement, and that any such data regarding users that is gathered through activities unrelated to this Agreement shall not be covered by this Agreement.

(k) Additional CNN Proprietary Rights. As between CNN and AOL, AOL acknowledges that CNN own(s) all right, title and interest in and to CNN.com and any CNN Enhancements (except for editorial Content regarding the use and functionality of the Web Service provided by AOL to CNN for incorporation in CNN.com, which Content shall be and remain the property of AOL (e.g., any disclosure text, text on how to search, or text on the use of safe search)), and that AOL shall not acquire any right, title, and interest in or to CNN.com or any CNN Enhancements, except as expressly set forth in this Agreement. AOL shall not modify, adapt, translate, prepare derivative works from, decompile, reverse engineer, disassemble or otherwise attempt to derive source code from any CNN software or documentation, including, without limitation, any CNN Enhancement.

(l) Safe Search. Beginning on the Effective Date, CNN may choose to use Safe Search as described in the Data Protocol for certain identified Queries, to which Queries CNN may also choose to have the Filters applied. Safe Search shall operate in accordance with the Data Protocol. AOL and the Third Party Provider shall address material malfunctions in the operation of Safe Search as is described in the Data Protocol as a Severity 1 Error in accordance with Exhibit B-2. AOL acknowledges and agrees that if CNN elects to use Web Search Filters in connection with Queries to which Safe Search is applied, the Query may result in a “no results” set being returned.

2.11 Data Protocol. AOL shall enable CNN, and hereby grants CNN the right, during the Term to use the Data Protocol in connection with the Web Service and the exercise of CNN’s rights hereunder. During the Term, AOL will provide all future releases of the Data Protocol to CNN at the same time the Third Party Provider makes such releases available to AOL. AOL confirms that the Data Protocol will enable CNN to select the features for the Web Service set forth on Exhibit B-1.

2.12 No Disabling. Except to the extent permitted by the proper use of any standard user interface or configuration (collectively, the “Software”) or otherwise agreed to in writing in advance by CNN, AOL shall not provide or implement any means or functionality relating to the Web Service or AOL’s or the Third Party Provider’s Web Site that would (i) alter, modify or enable CNN.com Users to alter or modify, the Software, (ii) disable any functionality of the Software, or (iii) modify the functioning of pages served by CNN.

2.13 Content Integration within One Click Products. (a) AOL shall integrate CNN Content within AOL’s One Click Product (to the extent it is generally available to AOL’s search customer base) or similar products that may be launched during the Term, provided that AOL Content is integrated within the One Click Product implementation, if any, on the CNN Search Results pages (or similar products that may be launched during the Term). The Content to be displayed within these products will link directly to the source property’s Web site. The designated editorial representatives of CNN and AOL shall agree on (i) the exact Content that will be integrated within the One Click Product implementation and other applicable products, and (ii) the degree of reciprocal integration. For the avoidance of doubt, there shall be no obligation on CNN to implement the One Click Product on CNN.com, including the CNN Search Results pages. In addition to the foregoing, (b) if AOL includes Content from parties other than AOL in AOL’s One Click Product, AOL shall integrate CNN Content within AOL’s One Click Product (to the extent it is generally available to AOL’s search customer base) and shall use commercially reasonable efforts to include at least one (1) link to CNN.com in each display of Content within the One Click Product. Further, (c) the Parties will work in good faith to explore how to incorporate CNN’s “hot topics” feed from CNN.com into AOL’s One Click Product.

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2.14 Toolbar Distribution. The Parties will discuss in good faith the potential of the distribution of a search toolbar for CNN.com that resolves to the CNN Search Results. For the avoidance of doubt, there shall be no obligation on either Party to agree upon or implement a search toolbar that resolves to CNN Search Results, provided, however, if CNN decides to create and implement a web search toolbar, CNN hereby agrees that during the Term such toolbar will resolve to the Sponsored Links Search Results Area and Web Search Results Area.

2.15 No Syndication. CNN will not resell, assign, transfer or syndicate the Web Service, the Sponsored Advertising Service or the Web Offers Links onto any third party or other product, property or service other than CNN.com, unless otherwise permitted pursuant to Section 2.14 above.

2.16 Additional CNN Implementation Requests. Notwithstanding anything to the contrary in this Agreement, any additional requests from CNN for implementing the Web Service, the Sponsored Advertising Service or the Web Offers Links on CNN.com (e.g., additional functionality around site specific searches) during the Term that are not contemplated by this Agreement shall be discussed in good faith and if agreed by the parties, shall be set forth in a written amendment to this Agreement, which may provide, among other things, AOL’s timing and cost estimate for any such new request(s).

3. OPERATIONS AND TECHNOLOGY; PROCESSES; QUARTERLY PERFORMANCE REVIEWS.

3.1. Hosting, Serving & Technology.

3.1.1 AOL shall ensure that the Third Party Provider shall serve all Advertising Results (e.g., as set forth with respect to delivery of results in Section 2.1.3 above) and, subject to the technical specifications and processes on Exhibit C, shall serve the XML feed of the Matched Results (e.g., as set forth with respect to the Third Party Provider’s delivery of results in Section 2.3 above). No third party, except for the Third Party Provider, shall be permitted to serve the Matched Results without CNN’s express written consent.

3.1.2 To the extent that CNN requests Matched Results for display as Sponsored Links, it shall do so using the XML feed referred to in Section 3.1.1 above in accordance with the terms of this Agreement.

3.2. Operating Standards. CNN reserves the right to review and test (as set forth in this Section 3.2 and in Exhibit C) the Matched Results as served into the Sponsored Links from time to time to ensure that such links and service remain compatible with CNN.com host software, and the other applicable portions of CNN.com. AOL shall ensure that the Sponsored Advertising Service and Sponsored Links comply at all times with the standards set forth in Exhibit C attached hereto and made a part hereof.

3.3. Advertising Terms and Conditions. AOL shall have, and shall ensure that Third Party Provider has, in place with each of its advertisers a set of written, standard, generally applicable advertising terms and conditions that may be negotiated with each of AOL’s and Third Party Provider’s Advertisers from time to time (the “Advertising Terms”). Notwithstanding any negotiation of such Advertising Terms, neither the Advertising Terms (e.g., in standard form or as may be negotiated) nor any other statement or representation of AOL or Third Party Provider shall provide or reasonably imply (at any time) that: (a) any Advertiser is guaranteed placement on CNN.com; or (b) AOL’s or Third Party Provider’s relationship with the Advertiser gives rise to any relationship between the Advertiser and CNN (the “Prohibited Advertising Terms”). AOL shall ensure that the restrictions herein shall apply to all Advertisers. Nothing in the preceding two (2) sentences shall be construed to prevent any Advertiser from declining to participate in syndication of its advertisements on CNN.com.

3.4. Quarterly Performance Reviews. During each quarter of the Term (i.e., every four (4) months), AOL shall be entitled to conduct an overall review of the pages of CNN.com where the Sponsored Links and/or Web Offers Links appear (a “Quarterly Performance Review”). If, during the Quarterly Performance Review, AOL finds that the average monthly Net Revenue for the Sponsored Links and Web Offers Links during the months covered by such Quarterly Performance Review are at or below the monthly average of the Revenue Threshold for the Term (i.e., $307,189.50 ($7,372,548 / 24)), then AOL shall notify CNN in writing (with e-mail being sufficient) and set up a meeting with CNN within (1) one week to discuss ways to improve monetization, which may include possible changes to the pages of CNN.com where the Sponsored Links and/or Web Offers Links appear in order to optimize revenue for such pages. If the Parties are unable to agree on changes to the pages of CNN.com where the Sponsored Links and/or Web Offers Links appear in order to optimize revenue for such pages then the Parties shall escalate such matter for further discussion to the Management Contacts identified in Section 1 of Exhibit E.

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4. EXCLUSIVITY OBLIGATIONS.

4.1 Search-Based Sponsored Text Links and Text-Based Algorithmic Internet Search Exclusivity.

(a) So long as this Agreement is in effect, with respect to CNN.com, AOL will be CNN’s exclusive third party provider for any Use of (i) Search-Based Sponsored Text Links, and (ii) Text-Based Algorithmic Internet Search, including with respect to the Licensing thereof.

(b) For the avoidance of doubt, under the foregoing exclusivity, CNN may not Use on CNN.com any third party service that (i) includes all the Attributes set forth in the definition of Search-Based Sponsored Text Links (taking into account the exceptions listed in the applicable definition), even if that third party service also includes additional features or functions unrelated to such Attributes, or (ii) includes all the Attributes set forth in the definition of Text-Based Algorithmic Internet Search (taking into account the exceptions listed in the applicable definition). For example, if a third party service includes all of the Attributes set forth in the definition of Search-Based Sponsored Text Links, but also includes a spell checker, then CNN may not Use such Search-Based Sponsored Text Links, but may Use the spell checker from the third party service.

(c) The exclusivity as set forth in this Section 4.1 will not apply to any Vertical Searches.

(d) Under this Section 4.1, in addition to the foregoing, CNN is also prohibited from redirecting Queries related to the Web Service or Site Search on CNN.com from CNN.com to a page other than the page on CNN .com where the Search Results are displayed. For the avoidance of doubt, it is not considered to be redirecting Web Service or Site Search Queries for the purpose of this paragraph if a user clicks on URL links that are delivered as Search Results.

5. ECONOMICS.

5.1. Minimum Revenue Guarantee. Subject to Section 5.2 below, during the Term AOL will pay CNN a total minimum revenue guarantee of $6,266,666.00 (the “Minimum Revenue Guarantee”). The Minimum Revenue Guarantee shall be payable by AOL to CNN on a monthly basis in installments equal to $261,111.00 per month on the first (1^st) day of each calendar month during the Term.

5.2. Performance Revenue. At any point during the Term, when the cumulative Net Revenue recognized by AOL during the Term exceeds the Revenue Threshold, AOL’s next monthly payment to CNN will include all remaining monthly Minimum Revenue Guarantee payments plus eighty-five percent (85%) of the Net Revenue recognized in excess of the Revenue Threshold. During the remaining months of the Term, AOL will pay CNN eighty-five percent (85%) of the Net Revenue recognized by AOL (the “Threshold Revenue Share”). As used herein, “Revenue Threshold” shall mean the total Minimum Revenue Guarantee payments to CNN divided by the Threshold Revenue Share (i.e., $7,372,548 ($6,266,666 / 0.85)). As used herein, “Net Revenue” shall equal revenue recognized by AOL from the Third Party Provider or Advertisers, as applicable, for the Advertising Results delivered to CNN during the Term. AOL shall pay CNN the Threshold Revenue Share, as described in this Section 5.2, on a monthly basis within thirty (30) days following the end of each applicable calendar month in which such amounts were recognized.

5.3. Wired Payments; Payment Contact. All payments required hereunder shall be paid in immediately available, non-refundable (except as expressly set forth in this Agreement) U.S. funds, which shall be either (a) wired to JPMorgan Bank, New York, NY, ABA #021000021, TBS, Inc./TBS Shared Receipts, Account 304-156744, Swift Code: CHASUS33, , or (b) transferred in another manner as agreed upon by the Parties. In the event of any questions regarding a payment made (or expected to be made) by AOL to CNN, CNN may contact Susanna Wolfe at Susanna.Wolfe@corp.aol.com and/or (703) 265-2080.

5.4 Taxes. As between AOL and CNN, AOL will pay any and all U.S. local, state, and national taxes (including, sales, use, personal property and excise taxes, customs fees, VAT, GST, and other Internet taxes), duties, levies, and assessments, however described or calculated (excluding taxes based on CNN’s net income) that apply to this Agreement (collectively, “Taxes”).

5.5. Reports and Auditing.

(a) AOL shall provide CNN written reports in a mutually agreed format setting forth, for both Sponsored Links and Web Offers Links, regular (at least monthly) (i) performance data, (ii) revenue data, and (iii) any other mutually agreed upon data, which shall be the equivalent to the reporting tools utilized by AOL for the management of the AOL search business (the “Reports”). CNN shall be entitled to use the Reports in its business operations and to disclose information derived from the Reports in an aggregate form (e.g., combined with other CNN sales information and in a manner that prevents

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individual identification of Advertisers or information). In addition, AOL shall use commercially reasonable efforts to provide CNN (starting on November 30, 2007) with a report within thirty (30) days of the end of each quarter of the Term that lists the Search Terms that have been searched on CNN.com during the previous quarter and the frequency with which each such Search Term was input.

(b) Notwithstanding any other provision on reporting in this Agreement, Queries shall be reported on a monthly basis by AOL to CNN based on AOL’s reporting (a “Monthly Query Report”). The number of Queries deemed delivered under this Agreement shall equal the number of Queries reported by AOL. If CNN disputes the number of Queries reported by AOL, then within thirty (30) days of CNN’s receipt of the applicable Monthly Query Report, CNN shall notify AOL of such dispute in writing and the Parties shall meet within three (3) business days of such notice to work together in good faith to resolve such dispute. If the Parties are unable to agree on how to resolve any such dispute then the Parties shall escalate such dispute to the Management Contacts pursuant to Section 1 of Exhibit E.

(c) AOL (and CNN, as applicable and to the extent CNN maintains any such records in the ordinary course of its business) shall maintain, and AOL shall ensure that the Third Party Provider maintains, complete, clear and accurate records relating to the obligations hereunder (including summary logs used to calculate and track Queries), and compliance with this Agreement (“Records”). All such Records shall be maintained for a minimum of ninety (90) days following termination or expiration of this Agreement.

(d) For the purpose of determining, in the event of a dispute, the accuracy of Queries, UAs, UA spam, Queries Spam, and other elements of the Reports provided by AOL, CNN shall have the right to direct a mutually agreeable independent third party auditor, which auditor must be a nationally recognized auditing firm (a “Metric Auditor”), subject to confidentiality restrictions consistent with those set forth in this Agreement (and any additional confidentiality restrictions as mutually agreed), to conduct reasonable and necessary copying and inspection of AOL’s Records and records of the Third Party Provider. Any such audit may be conducted after twenty (20) Business Days prior written notice, during normal business hours, no more frequently than once per year (and only with respect to a previously unaudited period) and shall be at CNN’s expense; provided, however, that if such inspection reveals any inaccuracy in any report of more than ten percent (10%) of the disputed item or any, AOL shall reimburse CNN for the reasonable fees charged by the Metric Auditor.

(e) For the purpose of determining, in the event of a dispute, AOL’s compliance with any of its payment obligations under this Agreement and upon AOL’s payment of the Threshold Revenue Share, CNN shall have the right to direct a mutually agreeable independent third party auditor, which auditor must be a nationally recognized auditing firm (a “Payment Auditor”), subject to confidentiality restrictions consistent with those set forth in this Agreement (and any additional confidentiality restrictions as mutually agreed), to conduct reasonable and necessary copying and inspection of AOL Records and records of the Third Party Provider. Any such audit may be conducted after twenty (20) Business Days prior written notice, during normal business hours, no more frequently than once per Year (and only with respect to previously unaudited period and no more than once per year), and shall be at CNN’s expense; provided, however, that if an inspection reveals any inaccuracy in any report of more than ten percent (10%) of any disputed item, (i) AOL shall promptly pay all amounts due under the Agreement as revealed by the audit and reimburse CNN for the reasonable fees charged by the Payment Auditor, and (ii) CNN shall thereafter have the additional right to conduct an audit pursuant to this subpart (f) once per the applicable Year only with respect to the remainder of the Year in which such reporting inaccuracy occurs. For the avoidance of doubt, at the beginning of each Year, the frequency of CNN’s audits shall be set at once per Year subject to this subpart (f).

6. TERM; MAKE GOOD TERM; TERMINATION; SUSPENSION.

6.1. Term. This Agreement will commence on the Effective Date and shall expire at 11 :59 p.m. (EST) on the date that is two (2) years after the Effective Date, unless extended pursuant to Section 6.2 below or terminated earlier as provided for in this Agreement (the “Term”).

6.2. Make Good Term. If, at the end of the Term, the Queries are less than the Queries Target, then, as AOL’s sole and exclusive remedy, the Term of this Agreement shall automatically extend until the earlier of: (a) the last day of an additional six (6) month period; or (b) the end of the month in which the cumulative number of Queries equals or exceeds the Queries Target (the “Make Good Term”). During any Make Good Term, AOL shall retain one hundred percent (100%) of all Net Revenues until the cumulative Net Revenue equals the Revenue Threshold, and CNN shall not be entitled to receive any portion of such revenues, provided however, if the cumulative number of Queries equal the Queries Target prior to the end of the month that the Make Good Term expires, AOL shall pay to CNN the Revenue Threshold Share for such excess Queries during the remainder of

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such month. Once the cumulative Net Revenue equals the Revenue Threshold, AOL will pay CNN the Threshold Revenue Share (i.e., eighty-five percent (85%) of the Net Revenue recognized by AOL) for the remainder of the Make Good Term.

6.3. Termination for Breach. Either Party may terminate this Agreement at any time in the event of a material breach of the Agreement by the other Party which remains uncured after thirty (30) days written notice thereof to the other Party; provided that, if the breaching Party is diligently working to effect a cure and requires more than thirty (30) days, then the cure period shall be extended for as long as reasonably necessary to effect the cure, but in no event more than thirty (30) additional days; provided further, that the cure period with respect to any payment shall be twenty (20) days from the date on which such payment is due as provided for herein without any extension of such cure period (“Payment Cure Period”).

6.4. Termination for Bankruptcy/Insolvency. Either Party may terminate this Agreement immediately following written notice to the other Party if the other Party (i) ceases to do business in the normal course, (ii) is declared insolvent or bankrupt by a court of competent jurisdiction, (iii) is the subject of any proceeding related to its liquidation or insolvency (whether voluntary or involuntary) which is not dismissed within ninety (90) calendar days or (iv) makes an assignment for the benefit of creditors.

6.5. Termination on Change of Affiliate Status of CNN. In the event that during the Term CNN ceases to be an Affiliate of Time Warner, Inc., AOL may terminate this Agreement by providing thirty (30) days written notice.

6.6. Suspension of Services. In the event that the Web Service and/or the Sponsored Advertising Service is suspended by the Third Party Provider and not generally available to AOL, AOL shall have the right to suspend CNN’s use of such services, as applicable, until they are again made generally available to AOL. If the Web Service and/or the Sponsored Advertising Service is suspended by the Third Party Provider and not generally available to AOL beyond twenty (20) days, CNN may terminate this Agreement upon written notice to AOL. In addition, (a) if AOL suspends the Web Service and/or the Sponsored Advertising Service pursuant to this Section, AOL shall continue to pay to CNN the greater of the pro-rated Minimum Revenue Guarantee or the pro-rated amount of Revenue Threshold Share paid to CNN during the preceding month (as applicable) for such time period, provided, however, that if CNN terminates this Agreement pursuant to this Section 6.6, AOL shall only be obligated to pay CNN the greater of the Minimum Revenue Guarantee or the Threshold Revenue Share paid to CNN during the preceding month through the effective date of such termination, and (b) during the period of the suspension, CNN shall receive credit towards the Query Target as follows: the number of Queries delivered by CNN each day of any suspension period shall be deemed to equal the daily average number of Queries delivered by CNN for the three (3) months preceding such suspension period.

6.7. Termination of the IMA and/or the Web Search Agreement. In the event that during the Term either the IMA or the Web Search Agreement is terminated (by either AOL or the Third Party Provider), AOL may terminate this Agreement upon sixty (60) days prior written notice, provided that; (a) CNN shall be entitled to retain all amounts previously paid and amounts due and owing through the effective date of such termination, and (b) AOL shall only be obligated to pay CNN (i) the Minimum Revenue Guarantee or (ii) the actual Threshold Revenue Share or (iii) if there is no revenue for all, or a portion of, this sixty (60) day period because service has been suspended and if cumulative Net Revenue recognized by AOL through such date exceeds the Revenue Threshold, AOL will pay CNN the pro-rated amount of the Revenue Threshold Share paid to CNN during the preceding month, as applicable, through the effective date of such termination. If, however, AOL is able to offer a replacement search provider, which is acceptable to CNN (as determined in CNN’s sole discretion), within sixty (60) days after giving notice to terminate this Agreement pursuant to this Section 6.7, then (i) AOL shall continue pay CNN the Minimum Revenue Guarantee or the Threshold Revenue Share, as applicable, for the Term of this Agreement, and (ii) CNN will use commercially reasonable efforts to transition into using the paid and organic search services of the agreed upon replacement search provider.

6.8. Termination of CNN AdSense for Content Agreement. In the event that during the Term the CNN AdSense for Content Agreement is terminated (by either CNN or the Third Party Provider), CNN may terminate this Agreement upon thirty (30) days prior written notice to AOL, provided that (i) AOL and CNN will have an executive management call before a termination notice is given and (ii) if such termination notice is given by CNN to AOL within the first twelve (12) months of the Term, CNN agrees to pay AOL one hundred twenty-five thousand dollars ($125,000) within sixty (60) days of such termination notice.

6.9. Effect of Termination. In the event of a termination of the Agreement on any date prior to the expiration of the Term (“Early Termination”), but without limiting the Parties’ other respective rights and remedies under this

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Agreement or at law, AOL shall pay to CNN: (i) within thirty (30) days following the date of such termination, the portion of the Minimum Revenue Guarantee for the time period of the Term, through the date of termination, and/or, as applicable (ii) the Threshold Revenue Share generated during the Term (and not yet paid) within thirty (30) days following the end of the month in which the applicable Threshold Revenue Share were generated.

7. RELATIONSHIP BETWEEN AOL AND ADVERTISERS.

7.1. Generally. AOL shall be deemed a CNN advertiser, subject to all applicable limitations thereon, but all Advertisers shall not be deemed CNN advertisers as a result of such status. As between CNN and AOL, AOL is responsible for all complaints, issues, disputes and claims of Advertisers with respect to CNN’s promotion of the Sponsored Links, and for excluding Excluded Results from the Matched Results or otherwise with respect to this Agreement. AOL will discharge all such responsibility as expressly set forth in this Agreement.

7.2. Claims by Advertisers for Termination. AOL shall ensure that it and the Third Party Provider have the ability to fulfill theirs obligations to their respective Advertisers other than through delivering the Advertising Results to CNN as Matched Results and Web Offers Links under this Agreement, such that, if CNN exercises any express rights herein to block or decline to distribute a Matched Result or Web Offers Links, then an Advertiser shall not, as a result of its relationship with AOL or the Third Party Provider, have gained the right to make a claim against CNN therefor. AOL shall discharge all such responsibility pursuant to Section 3.3, Section 10 of Exhibit E and Section 7.6 below.

7.3. Customer Service. As between the Parties, it is the sole responsibility of AOL, the Third Party Provider or Advertisers (and not CNN) to provide customer service to persons or entities purchasing products or services through the Advertiser Websites. AOL shall discharge all such responsibility pursuant to Section 3.3, Section 10 of Exhibit E and Section 7.6 below. CNN will have no obligations with respect to the products and services available on or through any Advertiser Website, including, but not limited to, any duty to review or monitor.

7.4. Applicable Laws; Infringement. As between AOL and CNN, AOL will bear all responsibility for the Advertiser Websites (a) complying with all applicable federal, state and local laws and regulations (including without limitation, as related to contests, sweepstakes, consumer protection and disclosure, out of stock products, etc.); (b) not infringing on nor violating any copyright, trademark, U.S. patent or any other third party right, including without limitation, any music performance or other music-related rights; and (c) not containing any libelous, or materially false or misleading statements. AOL shall discharge all such responsibility pursuant to Section 3.3, Section 10 of Exhibit E and Section 7.6 below.

7.5. Expert/Specialist Content. If any Advertiser Website for which a Matched Result is provided professes to provide any expert advice, then as between CNN and AOL, AOL shall be responsible for any third party claims brought against CNN to the extent based on allegations that such expert advice is not prepared or reviewed by licensed, insured and qualified practitioners/professionals in such field with expertise on the particular topic and to the extent based on allegations that such expert advice does not comply with applicable standards of the applicable profession or applicable laws and regulations. AOL shall discharge all such responsibility pursuant to Section 3.3, Section 10 of Exhibit E and Section 7.6 below.

7.6. Indemnification for Advertiser Claims. Notwithstanding anything to the contrary, and without limiting any additional indemnification herein, in the event CNN delays, reduces or removes any Sponsored Links, temporarily or permanently, as permitted by this Agreement, or terminates this Agreement as permitted herein (“CNN Permitted Actions”), CNN shall not, as a result of this Agreement, have any liability to any Advertisers. AOL shall, pursuant to the procedures established in Section 10 of Exhibit E, defend, indemnify, save and hold harmless CNN and all its officers, directors, agents, affiliates, distributors, franchisees and employees, from and against any and all demands, liabilities, costs or expenses, including reasonable attorneys’ fees, arising from third party claims by Advertisers against CNN arising from the CNN Permitted Actions.

8. STANDARD TERMS. The Standard Legal Terms & Conditions set forth on Exhibit E attached hereto are each hereby made a part of this Agreement.

9. COMMERCIAL LINKS. The terms set forth on Exhibit F attached hereto are hereby made a part of this Agreement.

[Intentionally left blank – the next page is a signature page]

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IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as of the Effective Date.

AOL LLC		CNN INTERACTIVE GROUP, INC.
By:	/s/ Theodore Cahall	By:	/s/ David Payne
Name:	Theodore Cahall	Name:	David Payne
Title:	CTO/EVP Platforms	Title:	SVP/GM
Date:	8/30/07	Date:	8/30/07

List of Exhibits
Exhibit A	Definitions
Exhibit B-1	The Web Service
Exhibit B-2	Priority Response Times
Exhibit C	Operations
Exhibit D	One Click Product
Exhibit E	Standard Legal Terms and Conditions
Exhibit F	Commercial Links
Exhibit G	User Registration and Privacy
Exhibit H	Sponsored Links Required Characteristics Mock-Ups
Schedule 1	Prohibited Entities List
Schedule 2.1	Ads Protocol Implementation Process

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EXHIBIT A

Definitions

The following definitions will apply to this Agreement:

Additional Matched Results. As defined in Exhibit F.

Additional Search(es). Any Vertical Searches or Site Searches.

Advertisers. Third party advertisers receiving placement within Advertising Results or the Web Offers Links.

Advertiser Website(s). The Interactive Sites of the Advertisers, as linked directly or indirectly to the Sponsored Links or the Web Offers Links in accordance with this Agreement.

Advertising Results. Results generated by queries to the Sponsored Advertising Service (including those based on common misspellings and plurals) or through Web Offers Links from CNN.com that are provided, as applicable, by or on behalf of paid Advertisers of the Third Party Providers and/or AOL, and not non-paid search results.

Advertising Terms. As defined in Section 3.3.

Affiliate(s). With respect to either Party, any entity that, directly or indirectly, controls, is controlled by, or is under common control with such Party, including any entity in which either Party or its parent, if any, holds, directly or indirectly, at least a twenty percent (20%) equity interest.

AOL Hand-Mapped Terms. Any web offers terms that result from an automated response to a query and that AOL did not obtain through licensed third party software Result Terms, but independently created or obtained.

AOL Technical Support Personnel. As defined in Exhibit B-2.

Attribute. Means, for each of Search-Based Sponsored Text Links and Text-Based and Algorithmic Internet Search, each of the attributes numbered by romanettes (e.g., i, ii, etc.) in the applicable definition therefor.

Business Day. A weekday (e.g., Monday through Friday), excluding any day a national holiday is observed on such weekday. For the avoidance of doubt and by way of example, a Business Day which begins upon receipt of notice at 9:00 pm PST shall continue up through and including 11:59 pm PST of the following Business Day.

Change of Control. (a) The consummation of a reorganization, merger or consolidation or sale or other disposition of substantially all of the assets of a Party; or (b) the acquisition by any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended) of beneficial ownership (within the meaning of Rule 13d-3 promulgated under such Act) of more than 50% of either (i) the then outstanding shares of common stock of such Party; or (ii) the combined voting power of the then outstanding voting securities of such Party entitled to vote generally in the election of directors.

Client Name. As defined in Section 2.2.2.

CNN AdSense for Content Agreement. The Google Services Agreement and Google Services Agreement Order Form for Google’s AdSense for Content Service dated July 1, 2007, between CNN and Google, Inc.

CNN Permitted Actions. As defined in Section 7.6.

CNN Search Results. The primary text-based Internet search results and Additional Search results generated by Queries on CNN.com.

CNN Search Service. With respect to CNN.com, (i) the Web Service (but expressly excluding the Sponsored Advertising Service) enabling CNN.com Users to conduct searches to locate information on the Internet, or (ii) any Additional Searches that are delivered to AOL or the Third Party Provider for the return of Matched Results and/or Web Offers Links.

CNN Enhancement. Any enhancement, added functionality, addition, extension or improvement to CNN.com created or developed by or for CNN for use with the Web Service or any technology of AOL or the Third Party Provider.

CNN User Information. As defined in Exhibit G.

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CNN.com. The U.S domestic version of CNN.com.

CNN.com User. Any user of CNN.com.

Confidential Information. As defined in Section 9(a) of Exhibit E.

Content. Text, images, video, audio (including, without limitation, music used in synchronism or timed relation with visual displays) and other data, products, advertisements, promotions, URLs, links, pointers and software, including any modifications, upgrades, updates, enhancements and related documentation.

Database. As defined in Exhibit B-1.

Early Termination. As defined in Section 6.9.

Effective Date. As defined in the exordium of this Agreement.

Error. Any error, bug, malfunction or other instance where the Third Party Provider-controlled portions of the Web Service do not substantially conform to agreed-upon features and specifications.

Excluded Results. Any Advertising Results that would or should reasonably be excluded from the Matched Results in accordance with Sections 2.8 or 2.9.

First Pages. The initial page on which search results are displayed on CNN.com after a Query is entered.

Fully Processed and Served. As defined in Section 2.5.

IMA. The Amended and Restated Interactive Marketing Agreement dated October 1, 2003, as amended, between AOL and Google, Inc.

Intellectual Property Rights. Any and all rights existing from time to time under patent law, copyright law, moral rights law, trade secret law, trademark law, unfair competition law, publicity rights law, privacy rights law, and any and all other proprietary rights, and any and all applications, renewals, extensions and restorations thereof, now or hereafter in force and effect worldwide.

Interactive Site. Any interactive product, site or area, including, by way of example and without limitation, (i) a site on the World Wide Web portion of the Internet or (ii) a channel or area delivered through a “push” product (such as the Pointcast Network).

Keyword Filter. As defined in Section 2.10(a).

Keyword List. As defined in Section 2.10(a).

Liabilities. As defined in Section 10.3 of Exhibit E.

Licensed Content. All Content provided by the Third Party Provider or AOL to CNN, pursuant to this Agreement (e.g., offline or online Promotional Materials, Content, Matched Results, etc.), including in each case, any modifications, upgrades, updates, enhancements, and related documentation. Licensed Content shall include, without limitation, (i) all other portions or aspects of the Matched Results provided by the Third Party Provider (e.g., contextual links and the XML formatting codes, functionality and/or URLs that enable a user of Sponsored Links to access the Sponsored Advertising Services, but shall expressly exclude all content of Advertisers on the Advertiser Websites, (ii) the Search Results, but in any event not including the Content of websites that are linked to by the Search Results, and (iii) the Web Offers Links.

Licensing. Means the licensing or similar procurement by CNN of a technology solution from a single third party provider and/or its Affiliates, which technology solution enables CNN to engage in substantially all aspects of the performance of (a) any Search-Based Sponsored Text Links (e.g., the licensing from a single third party provider and/or its Affiliates of a platform for the sale of Search-Based Sponsored Text Links by CNN), or (b) any Text-Based and Image-Based Algorithmic Internet Search (e.g., the licensing from a single third party provider and/or its Affiliates of a platform for the sale of Text-Based and Image-Based Algorithmic Internet Search by AOL).

Linking Mechanism. A mechanism provided in accordance with the Protocol in Schedule 2.1 (including the Preamble thereto) of this Agreement to enable CNN.com Users to connect directly or indirectly via a redirect to CNN.com then to AOL or the Third Party Provider (in such a manner as allows AOL to count the UA corresponding to such link) and from AOL or the Third Party Provider to an Advertiser’s website as identified by a URL in such Advertiser’s Matched Result.

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Make Good Term. As defined in Section 6.2.

Mapping Process. The query mapping and taxonomy development functions by which Queries are indexed, categorized, and organized using an AOL licensed third party software, and by which Result Terms are created and provided to CNN ranked by relevancy and value.

Matched Results. Advertising Results that are processed by the Third Party Provider on behalf of AOL and CNN pursuant to the IMA (including filtering, as applicable) in connection with Search Terms or other search queries from CNN.com Users (e.g., including terms input by CNN.com Users in the CNN Search Service), using the Third Party Provider’s proprietary technology, and are then delivered to CNN for CNN to display as Sponsored Links as set forth herein and consistent with all applicable provisions and requirements hereof.

Matched Results Set. The set of all Matched Results (whether one (1) or more than one (1) Matched Result) with respect to any given page.

Maximum Delivery Time. As defined in Section 2.5.

Metric Auditor. As defined in Section 5.5(d).

Minimum Revenue Guarantee. As defined in Section 5.1.

Monthly Query Report. As defined in Section 5.5(b).

Net Revenue. As defined in Section 5.2.

Next Page. To the extent within the Sponsored Links Search Results Area or the Web Search Results Area on CNN.com, the “next” page containing CNN Search Results following an initial page on which CNN Search Results appear (but not such first (top level) screen) (i.e., if Matched Results appear as Sponsored Links as the result of a particular CNN Search Results search within the CNN Search Service (assuming that there are qualifying Matched Results), and such resulting page has a “next” button to see more Search Results for the same search, then the subsequent Search Results pages, which contain a continuation of the Search Results, are Next Pages).

One Click Product. The product as set forth and illustrated in Exhibit D.

Payment Auditor. As defined in Section 5.5(e).

Payment Cure Period. As defined in Section 6.3.

Press Release. As defined in Exhibit E, Section 9(d).

Prohibited Advertising Terms. As defined in Section 3.3.

Prohibited Entities List. As defined in Section 2.8(b)

Promotional Materials. As defined in Exhibit E, Section 9(e).

Protocol or Data Protocol. As defined in Section 2.1.

Quarterly Performance Review. As defined in Section 3.4.

Queries. CNN.com Users search requests for results that are generated using the CNN Search Service (including those generated by inserting the applicable word, phrase or category ID into a search box, or (as approved by AOL, not to be unreasonably withheld) clicking on or (as approved by AOL, not to be unreasonably withheld) selecting from a pull down menu, and those generated when a search request consists of a CNN.com User clicking to the Next Page to get more results, clicking on a Web Offers Link,) or Additional Searches to be delivered to the Third Party Provider or AOL (as applicable). AOL hereby approves CNN.com Users clicks on terms presented on CNN.com in a “Top Searches” area where CNN displays the most frequently searched terms as Queries.

Query Spam. Those queries which have been reasonably determined by AOL or the Third Party Provider to be generated through any automated, deceptive, fraudulent or other invalid means (including, but not limited to, click spam, robots, macro programs, and Internet agents).

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Query Target. Three hundred and seventy two million, five hundred thousand (372,500,000) Queries.

Records. As defined in Section 5.5(c).

Redesigns. As defined in Section 2.1.2.

Relevant. Advertising Results that are clearly and obviously reflective of the search term, the line listing (title and description) accurately describes why the Web site is listed for the search term, and the Web site is clearly and obviously reflective of the search term.

Reports. As defined in Section 5.5(a).

Restricted Result. As defined in Section 2.10(b).

Result Terms. High value cost per click terms yielded from licensed third party software by running the Mapping Process, and taxonomies (including data, node definitions for each taxonomy, query terms in each node, positive/negative rules logic, relevancy and CPC rankings), that processes user query terms and returns query terms.

Results Set. The data set presented by the Search Engine consisting of between 0 and 15 records on a page in response to a Query (it being understood that the maximum such number qualifying and available will be sent).

Revenue Threshold. As defined in Section 5.2.

Search Engine. Computer software which crawls the Internet, downloads and analyzes text and other data, sorts and organizes the data, creates an index of accessible data, and, after receiving a particular search request (in the form of a word Query), locates material accessible in the database, and presents the results of the search.

Search Results. The search results from (i) the Web Service, consisting of the selection and ordering of URLs, image URLs and other related data with respect to a particular search Query, the corresponding numerical relevancy rankings among the results of a particular search, and any corresponding web site descriptions created by the Third Party Provider itself, that are provided by the Third Party Provider to CNN for serving and displaying to CNN.com Users on CNN.com, and (ii) the Sponsored Advertising Service.

Search Terms. The applicable word, phrase or category ID (as applicable) being input into a search box, or (as approved by AOL, not to be unreasonably withheld) clicked on, or (as approved by AOL, not to be unreasonably withheld) selected from a pull down menu by CNN.com Users to conduct a search for matching results using the Sponsored Advertising Service. AOL hereby approves the terms presented on CNN.com in a “Top Searches” area where CNN displays the most frequently searched terms as Search Terms.

Search-Based Sponsored Text Links. Means (i) auction-based, (ii) cost-per-click, (iii) text links (which may include an ancillary icon or logo, or other isolated graphical element), (iv) triggered only off of keywords (e.g., input by users in a search query box, through clicks on links consisting of suggested searches or keyword(s) preprogrammed by or for CNN, embedded in a URL link) and factors used by the provider’s automated system to better determine the relevancy of the link to the keyword (e.g., excluding behavioral targeting) and (v) delivered in the context of Web Service search and Site Search results. For the avoidance of doubt, Sponsored Links delivered in the context of Web Service search and Site Search results are “Search-Based Sponsored Text Links”.

Service Data. As defined in Section 2.9(j).

Service Pages. All pages of CNN.com where CNN elects to utilize the Web Service and collect Queries to send to the Third Party Provider hereunder (“Query Pages”), plus all pages containing the Web Search Results Areas.

Severity 1 Error. Means any Error that results in any material part of the web Service becoming inaccessible to CNN and CNN.com Users or inoperable, such that no useful work can be done.

Severity 2 Error. Means any Error that causes any feature of the Web Services to perform unpredictably or to otherwise become intermittently unavailable, or that causes the Web Service to have a significant degradation in response time or functional performance.

Site Searches. Searches of the CNN.com site (e.g., not Internet searches but searches of the CNN.com site, including text, video and image searches).

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Software. As defined in Section 2.12.

Sponsored Advertising Service. The Third Party Provider’s service which performs searches of the Third Party Provider’s and AOL’s database of Advertisers based on requests over the Internet or requests from Additional Searches and is accessible to CNN and CNN.com Users to the extent set forth herein, or if the Third Party Provider provides an “Alternate Google Advertising Service” (as defined in the IMA), a Sponsored Links advertising service of the Third Party Provider (including all related inventions, processes, algorithms, intellectual property and other rights forming part of such service), that is functionally equivalent or superior to the Sponsored Advertising Service.

Sponsored Links. The Matched Results and any Content associated with the Matched Results, as appearing within the Sponsored Links Search Results Areas (e.g., including without limitation the Next Pages) on the pages of CNN.com where CNN Search Results appear.

Sponsored Link Filter Rules. As defined in Section 2.8(b).

Sponsored Link First Level Failure. As defined in Section 2.8(a).

Sponsored Link First Level Filter. As defined in Section 2.8(a).

Sponsored Link First Level Filter Rules. As defined in Section 2.8(a).

Sponsored Links Required Characteristics. As defined in Section 2.1.1.

Sponsored Links Search Results Area. Means, with regards to Sponsored Advertising Service, the area of the page where actual Sponsored Links are displayed, which area is above the area of the page where CNN Search Results for the CNN Search Service appear, in each case only to the extent within CNN.com (as defined herein) (expressly excluding other areas/pages which may be linked to from such page, e.g., via tabs such as “Images,” “Community,” etc.).

Sponsored Link Second Level Failure. As defined in Section 2.8(b).

Sponsored Link Second Level Filter. As defined in Section 2.8(b).

Sponsored Link Second Level Filter Rules. As defined in Section 2.8(b).

Sponsored Link Excess Slippage. As defined in Section 2.9(b).

Sponsored Link Slippage. As defined in Section 2.9(b).

Support Pagers. As defined in Exhibit B-2.

Support Address. As defined in Exhibit B-2.

Taxes. As defined in Section 5.4.

Term. As defined in Section 6.1.

Text-Based Algorithmic Internet Search. Means a service which (i) performs general searches of information across the Internet (and which, in addition to searching across the Internet, may also search additional sources of information) (ii) is triggered off of keywords (e.g., input by users in a search query box, or through click(s) on link(s) consisting of suggested search(es) or through keyword(s) preprogrammed by or for CNN, embedded in a URL link), and which displays results that (iii) are unpaid, (iv) are automatically generated by use of an algorithm designed to show data primarily from the Internet which is relevant to the search queries submitted, and (v) consist either primarily or solely of text (i.e., which may include an ancillary icon or logo or other isolated graphical element). Text-Based Algorithmic Internet Search expressly excludes (a) with respect to romanette (v) above, any search format other than primarily or solely text as described in romanette (v) above (such as image, video, audio, etc.), (b) with respect to romanette (iii) above, any paid search elements, such as for database inclusion, placement in results, etc., (c) any search services which are ancillary to the services described in the first sentence of this paragraph, that do not themselves consist of Text-Based Algorithmic Internet Search, but rather enhance such services (e.g., clustering of search results, personalization of search results, etc.) and (d) Site Searches and Vertical Searches. For the avoidance of doubt, the Web Service is “Text-Based Algorithmic Internet Search”.

Third Party Provider. Means Google, Inc.

Third Party Provider Advertising Network. The entire distribution network of the Sponsored Advertising Service (or similar service provided by the Third Party Provider to other syndicated advertising partners), including such service(s) on properties owned or operated by the Third Party Provider (e.g. Google.com).

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Third Party Provider Technology. The Search Engine, the Data Protocol and all other computer software, technology and/or documentation relating thereto used by the Third Party Provider in connection with delivery of the Web Service, including without limitation all source code and object code therefor and all algorithms and Intellectual Property Rights therein.

Timing Out. As defined in Section 2.5.

Threshold Revenue Share. As defined in Section 5.2.

Transition Notice. As defined in Section 6.6.

UA or User Actions. A UA occurs when any CNN.com User clicks on any Sponsored Link and is transferred, directly or indirectly, to the Third Party Provider’s servers, expressly excluding any Excluded UAs. For purposes hereof, “Excluded UAs” shall mean any clicks (a) directly resulting from fraud for which AOL or the Third Party Provider does not receive any compensation as a result of such fraudulent status; (b) directly resulting from testing by CNN for which AOL or the Third Party Provider does not receive any compensation as a result of such testing; (c) directly resulting from any other clicks for which AOL or the Third Party Provider does not receive any compensation from an Advertiser due to fraud, malicious clicks, testing, ‘bots’ or automated programs, or (d) which AOL or the Third Party Provider is unable to count as a direct result of CNN’s failure to materially comply with the Protocol described in Schedule 2.1 (including the Preamble thereto); provided that any uncompensated clicks which are uncompensated for any other (e.g., commercial) reasons (e.g., customer relations, giveaways or other promotional purposes and similar activity) shall expressly not be deemed Excluded UAs.

URL List. As defined in Section 2.10(b).

Use. Means use, distribute, provide, display or otherwise make available.

Valid IP Address. As defined in Section 2.2.2.

Vertical Searches Means searches targeted to market segments (e.g., travel, shopping, local, news, kids/teens, movies, etc.), regardless of whether such searches search CNN.com, a third party site or sites, a database and/or other source.

Web Offers Landing Page. The page of advertisements served by AOL in response to a CNN.com User clicking on either Result Terms or AOL Hand Mapped Terms.

Web Offers Links. Links served by AOL’s Internet based web offers program for directing Internet search engine users and users of Additional Searches to a landing page of Sponsored Links relevant to the users’ search queries through the use of Result Terms or AOL Hand Mapped Terms.

Web Offer Required Characteristics. As defined in Section 2.3.1.

Web Search Agreement. The Web Search Agreement dated May 1, 2002, as amended, between AOL and Google, Inc.

Web Search Filter Rules. As defined in Section 2.10(a).

Web Search Filters. As defined in Section 2.10(b).

Web Search Results Area. Means, with regards to the Web Service, the area of the page within CNN.com where CNN displays search results from the Web Service responsive to Queries performed by an end user, and explicitly excluding any Additional Searches.

Web Search Slippage. As defined in Section 2.10(g).

Web Service. The Internet services relating to the Search Engine to be provided by the Third Party Provider via AOL for CNN under this Agreement, as more fully described, and according to the specifications listed, on Exhibit B-1, explicitly excluding the provision of paid-for search results.

Workaround. A method by which a user of a product can, by making a limited number of procedural or programming changes in a product, prevent the occurrence or re-occurrence of an Error. Programming changes include, without limitation, adjustments to set-up and configurations files or other settings that do not require recompilation.

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EXHIBIT B-1

EXHIBIT B-1: THE WEB SERVICE

Description of Service

AOL shall make available to CNN, and the “Web Service” shall consist of, the Third Party Provider’s web search services. AOL shall ensure that the Web Service is equal to the version of the Third Party Provider’s commercially available Web Service in all material respects, unless otherwise provided for in this Agreement and except to the extent that CNN selects filtering options in accordance with the Data Protocol. AOL shall, upon availability, provide any Upgrades to the Web Service to CNN free of charge during the Term. “Upgrades” shall mean upgrades and enhancements in connection with the services offered by the Third Party Provider that are made generally available to AOL at no cost.

Upon the Effective Date and throughout the Term, AOL shall make available to CNN in connection with the Web Service the Third Party Provider Database (the “Database”).

If any new algorithmic search products and services in which responses to Queries are generated through application of an algorithm are provided to AOL by the Third Party Provider (“New Products”), AOL shall, upon receipt of such products or services, make such products or services available to CNN during the Term, at an agreed upon price. Notwithstanding the foregoing, if CNN declines a New Product, AOL shall continue to deliver the Web Service pursuant to the terms of this Agreement.

AOL shall ensure that all New Products made available to CNN under this Agreement are equal to the version of such New Products provided to AOL in all material respects. AOL shall, upon availability, provide any Upgrades to the New Products, that are made generally available by the Third party Provider to AOL, to CNN free of charge during the Term. In addition, AOL shall make available to CNN, in connection with any New Product described above, the database (that is made the commercially available to AOL) accessible through such New Product on agreed upon pricing.

Technical Requirements (with respect to all Query traffic directed by AOL to an interconnect meeting place located in the United States (and other interconnect meeting places as mutually agreed)).

1. The following definitions shall apply to this Exhibit B-1:

a. “CNN Equipment and Software” shall mean equipment and software owned by CNN or operated at CNN’s instruction pursuant to agreements CNN has with third party service providers (other than AOL or the Third Party Provider).

b. “Availability” shall mean the percentage of Queries that are Fully Processed and Served within five seconds, over a rolling thirty (30) day period.

c. “End to End Latency” shall mean the time for Queries to be Fully Processed and Served.

d. “First Level Escalation Contact” shall mean, in the case of CNN, the CNN Network Operations Center, E-mail: noc-ops@web.turner.com, and tel. 404-878-0808; and, in the case of AOL, the AOL Network Operations Center, tel. (703) 265-4662 (which contacts may be changed upon reasonable written notice to the other party with a replacement having comparable seniority and experience).

e. “Fully Processed and Served” shall mean fully queried, matched, and processed, from the time sent from CNN Equipment and Software to Third Party Provider Equipment and Software, to the time received back by CNN Equipment and Software from Third Party Provider Equipment and Software (including a complete http response, with a complete set of Service Results or a “no results” set served in XML format), excluding any time, delays or outages due to CNN Equipment and Software, and provided the Parties mutually agree on, and maintain, a private interconnect meeting place.

f. “Third Party Provider Equipment and Software” shall mean equipment and software owned by the Third party Provider or AOL or operated at AOL and the Third Party Provider’s instruction pursuant to agreements that the Third Party Provider has with third party service providers.

g. “Second Level Escalation Contact” shall mean, in the case of CNN, Dennis Jones, Technology Manager, e-mail: dennis.jones@turner.com and tel.404-885-4235 and, in the case of AOL, Pete Jones, tel. (703) 265-4333 (which contacts may be changed upon reasonable written notice to the other party with a replacement having comparable seniority and experience).

h. “Network Latency” shall mean the round trip time for an ICMP ping packet sent by CNN between the applicable US CNN server sending Queries to the US Third Party Provider data center handling CNN’s Queries, provided that the Parties mutually agree on, and maintain, a private interconnect meeting place, and excluding any time, delays or outages due to CNN Equipment and Software.

i. “Server Latency” shall mean the latency between the time a Query is received by the Third Party Provider’s servers and the time transmission of the Search Results is initiated.

j. “Third Level Escalation Contact” shall mean, in the case of CNN, Dermot Waters, Dir of Technology - -

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CNN.com, e-mail: dermot.waters@turner.com and tel. 404-878-5832 and, in the case of AOL, Kevin Namey, tel. (703) 265-4167 (which contacts may be changed upon reasonable written notice to the other party with a replacement having comparable seniority and experience).

2. The following four (4) targets shall apply to the Web Service for Queries coming from a Valid IP Address under Section 2.2.2:

	Target (Target Amount”)	Low Priority Problem	Medium Priority Problem	High Priority Problem
Server Latency	Up to 0. 8 seconds over any 6 hour period	0. 8-1 second over any 6 hour period	1-1.5 seconds over any 6 hour period	1.5 or more seconds over any 6 hour period
Network Latency	Up to 50 milliseconds over any 6 hour period	50-99 milliseconds over any 6 hour period	100-125 milliseconds over any 6 hour period	125 or more milliseconds over any 6 hour period
End to End Latency	Up to 15% Fully Processed and Served in 1 second or more per day	20% Fully Processed an Served in 1 second or more per day	25% Fully Processed and Served in 1 second or more per day	30% or more Fully Processed and Served in 1 second or more per day
Availability	No less than 99.95%	99.95%-99.9%	99.9%-99.6%	99.5% or less

a. Any Low Priority Problem (other than Availability) that occurs four (4) or more times in any thirty (30) day period (measured on a rolling thirty (30) day basis) shall be considered a Medium Priority Problem.

b. Any Medium Level Problem (other than Availability) that occurs six (6) or more times in any thirty (30) day period (measured on a rolling thirty (30) day basis) shall be considered a High Priority Problem.

3. Responses to Problems. The following shall apply except as otherwise provided in Section 2.2.3 of the body of this Agreement.

a. Low Priority Problems. Both Parties shall address Low Priority Problems as Severity 2 Errors in accordance with Exhibit B-2.

b. Medium Priority Problems. Both Parties shall address Medium Priority Errors as Severity 1 Errors in accordance with Exhibit B-2. CNN may also contact the First Level Escalation Contact if the target response times set forth in Exhibit B-2 are not met. If a Medium Priority Error is not Fixed or a Workaround is not implemented within twelve (12) hours after contacting the First Level Escalation Contact, the Second Level Escalation Contact may be contacted. If the Medium Priority Error is not Fixed or a Workaround is not implemented within twelve (12) hours after contacting the Second Level Escalation Contact, then the Third Level Escalation Contact may be contacted. If either Party’s Escalation Contact has been contacted by the other Party, they may contact the corresponding Escalation Contact.

c. High Priority Problems. Both Parties shall address High Priority Errors as Severity 1 Errors in accordance with Exhibit B-2, CNN may contact the First Level Escalation Contact if the High Priority Problem is not Fixed or a Workaround is not implemented within the target response times set forth in Exhibit B-2. If a High Priority Error is not Fixed or a Workaround is not implemented within one (1) hour after contacting the First Level Escalation Contact, the Second Level Escalation Contact may be contacted. If the High Priority Error is not Fixed or a Workaround is not implemented within two (2) hours after contacting the Second Level Escalation Contact, then the Third Level Escalation Contact may be contacted. If either Party’s Escalation Contact has been contacted by the other Party, they may contact the corresponding Escalation Contact.

4. Measurement

a. Within forty-five (45) days from and after the Effective Date, Third Party Provider shall provide CNN with 5-minute delayed data that is viewable by a web browser to display the following two statistics for CNN.com using

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the Web Service: (1) Queries per second; and (2) average Server Latency. Such statistics should display the following intervals:

Last 30 minutes

Last 2 hours

Last 6 hours

Last 12 hours

Last 24 hours

Last 7 days

b. Intentionally blank.

c. The Third Party Provider and CNN shall each follow the following data/record keeping guidelines with respect to the data described in this Section 4:

i. The audit provisions contained in Section 5.5 of this Agreement shall apply to the data described in this Section 4 of Exhibit B-1, solely to the extent that records relate to the obligations described in Sections 2 and 3 of this Exhibit B-1.

ii. Both Parties agree to use commercially reasonable efforts to discuss performance, availability, outages, issues/escalations, upcoming events/releases/changes on a quarterly basis.

5. Other Service Requirements

a. Refresh. AOL shall Update the Database no less frequently than the database provided to AOL by the Third Party Provider. “Update” shall mean the process by which the Third Party Provider refreshes the Database (to update the web Service and Search Results from such Database).

b. Consistency. AOL shall provide all necessary data and IP addresses for CNN to do its own test of the Third Party Providers Consistency (defined below). Such tested Search Results shall remain Consistent (for CNN.com and Web Search Filter Rules until the Database is Updated (it being understood and agreed that the Third Party Provider Updates its own Database frequently) in no less than 99% of instances (over a reasonable sample size and number of Queries) in which a CNN.com User uses the web Services. “Consistent” shall mean that a Query returns the same Results Set for an exactly matching Query. A lack of such tested Consistency shall be considered a Severity 2 Error and shall be addressed by AOL in accordance with the requirements set forth in Exhibit B-2 of this Agreement.

c. Implementation of Technical Specifications. The latency and availability in this Exhibit B-1 shall only apply provided that (a) CNN implements the technical specifications concerning correct use of XML protocol arguments and correct handling of optional or new result fields set forth in the Data Protocol, (b) CNN’s DNS client implementation correctly complies with the DNS TTL time values returned by the Third Party Provider’s DNS servers, i.e., CNN’s DNS client does not cache data beyond the TTL time, and (c) CNN sends Queries to the host name provided to CNN by the Third Party Provider (e.g., CNN.google.com) and CNN’S client implementation repeats the DNS lookups at least every five seconds in order to pick up any changes. This Section 5(c) shall apply to any “backward compatible” updates to the Data Protocol unless CNN has consented to such updates and the date for their implementation, which consent will not be unreasonably withheld, where “backward compatible” updates means updates that do not require changes by CNN in order to maintain the same level of functionality that existed previous to the proposed update. Data Protocol updates that are backward compatible shall be considered to be a part of the Data Protocol to the extent that they are delivered by the Third Party Provider or AOL to CNN with reasonable notice and are concurrently generally required of the Third Party Provider’s commercial search customers.

d. Safe Search. CNN may elect to send Queries with “Safe Search” (e.g., adult versus kids) on or off on a Query by Query basis to filter out inappropriate or offensive content. The Parties acknowledge and agree that the Safe Search technology will not remove all objectionable search results. Safe Search, when selected, is intended to prevent adult and explicit content from appearing in Results Sets. During the Term the Third Party Provider will make Safe Search available to CNN and will continue to develop Safe Search.

e. Problem Review Meetings and Reporting. The Parties agree that they will use commercially reasonable efforts to meet via e-mail or telephone after resolution of any Medium Priority or High Priority Problem that was caused by Third Party Provider Equipment and Software.

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EXHIBIT B-2

PRIORITY RESPONSE TIMES

AOL shall provide, or cause the Third Party Provider to provide, to CNN support services for the Web Service consistent with the following support obligations:

1. OBLIGATIONS

1.1 Support Contact Points.

CNN Technical Support Personnel. CNN will designate a subset of operations positions (up to two (2) positions, and up to a total of four (4) English-speaking persons filling such positions) for all of CNN as qualified contact liaisons for AOL regarding technical support. CNN may change such designated positions or persons at its discretion with reasonable notice to AOL, provided that their numbers do not exceed two (2) and four (4), respectively. AOL acknowledges that CNN will not provide first-level technical support to CNN.com Users of the Web Service.

AOL Technical Support Personnel. AOL and/or the Third Party Provider shall provide back-up technical support to CNN regarding the Web Service. AOL shall appoint sufficient technical support personnel with reasonable and substantial relevant training and experience to whom CNN may address all technical questions relating to the Web Service (“AOL Technical Support Personnel”). AOL will ensure that its AOL Technical Support Personnel are adequately trained to provide technical support to CNN. AOL will provide CNN with an email address (the “Support Address”), a primary and secondary email pager number (the “Support Pagers”), and a telephone support number for contacting the AOL Technical Support Personnel no later than ten days after the Effective Date. AOL will also provide CNN with contact information for executive escalation personnel no later than ten days after the Effective Date. AOL may change its designated AOL Technical Support Personnel and executive escalation personnel at its discretion with reasonable notice to CNN.

1.2. Error Reporting. Errors may be reported on a 24 hours per day, 365 day per year basis via e-mail by any one contacts designated as set forth above.

1.3. Support Requests. AOL will use commercially reasonable efforts to respond to and provide a Fix for Severity 1 and Severity 2 Errors that anyone of the contacts designated as set forth above identifies, classifies and reports to AOL, and will use reasonable commercial efforts to respond and provide a Fix to all other Errors, in accordance with the following:

Severity 1 Error:

Target Response time: 60 mins

Target Fix time:120 mins

Severity 2 Error:

Target Response time: 90 mins

Target Fix time: Two days

For all other Errors, AOL will use commercially reasonable efforts to respond and to provide a Fix as soon as practicable.

AOL will inform CNN Technical Support Personnel of Fixes as soon as they are complete.

Primary contact for Severity 1 problems: AOL Network Operations Center, tel. (703) 265-4662

Primary contact for Severity 2 problems: AOL Network Operations Center, tel. (703) 265-4662

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EXHIBIT C

OPERATIONS

A. THE SERVICE

Description of Service

The Sponsored Advertising Service offered on CNN.com shall at all times be the primary and most widely available advertising search service the Third Party Provider makes commercially available to AOL to enable AOL users to search for information from the AOL’s and Third Party Provider’s database of Advertisers, unless otherwise agreed to by the Parties in a written Amendment to this Agreement.

B. RESPONSES AND SUPPORT

1.1 Technical Support. AOL will ensure that its and the Third Party Provider’s Technical Support Personnel are adequately trained to provide technical support to CNN. Prior to commercial launch of any material placements (or any material changes thereto), CNN will have the right to conduct reasonable performance testing (in person or through remote communications), with such commercial launch not to commence until such time as CNN is reasonably satisfied with the results of any such testing, so long as CNN conducts such testing within a reasonable time following notice of such contemplated launch from AOL (which written notice may be in the form of email).

1.2. Error Reporting. AOL will ensure that the performance and availability of the Service and Matched Results is monitored on a continuous basis. Errors may be reported on a 24 hours per day, 365 day per year basis via e-mail by any one of the contacts designated as set forth above.

1.3. Support Requests.

For all material problems affecting use by CNN.com Users of the Sponsored Advertising Service and Matched Results, AOL will provide a fix within a commercially reasonable period of time.

CNN may contact the following AOL executive escalation personnel in order (such personnel subject to change following prior written notice):

For general support contact: AOL Network Operations Center, tel. (703) 265-4662

Primary contact for highest severity problems: AOL Network Operations Center, tel. (703) 265-4662

Primary contact for other severe problems: AOL Network Operations Center, tel. (703) 265-4662

First Escalation Contact: AOL Network Operations Center, tel. (703) 265-4662

= = = =

Second Escalation Contact:

Pete Jones

Email: peter.jones@corp.aol.com

Phone: 703-265-4333

= = = =

Third Escalation Contact:

Kevin Namey

Email: Kevin.namey@corp.aol.com

Phone: 703-265-4167

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EXHIBIT D

ONE CLICK PRODUCT

The “One Click Product” consists of text links that link to relevant editorial content and which are below the news results links above the Web Search Results Area.

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EXHIBIT E

STANDARD LEGAL TERMS & CONDITIONS

1. Executive Dispute Resolution. In the event of any dispute or disagreement (each a “Dispute”) between the Parties or any of their respective subsidiaries, affiliates, successors and assigns under this Agreement or any document executed pursuant to this Agreement which cannot be resolved by the Parties, then the Dispute shall be submitted to the Executive Contacts (as defined below) for resolution. For ten (10) Business Days after the Dispute was submitted to the Executive Contacts, the Executive Contacts shall meet in person or by phone and attempt In good faith to resolve such Dispute; provided further. that the Executive Contacts shall have the final and exclusive right to resolve Disputes arising from any provision of this Agreement which expressly or implicitly provides for the Parties to reach mutual agreement as to certain terms. “Executive Contacts” or “Management Contacts” shall mean David Payne, Senior Vice President & General Manager CNN.com for CNN and John Kannapell, Senior Vice-President AOL Search Business for AOL, or their designees (together, the “Management Committee”), and generally overseeing the relationship between the Parties contemplated by this Agreement.

2. License. AOL hereby grants CNN a non-exclusive worldwide royalty free license to use, market, store, distribute, communicate, reproduce, display, perform, transmit and promote the Licensed Content (or any portion thereof) through such areas or features of CNN.com as CNN deems appropriate in its reasonable discretion. In addition, CNN Users will have the right to access each Advertiser Website.

3. Trademark License. In connection with the Web Service, including for use on the Service Pages as CNN deems desirable, and the design and implementation of Promotional Materials (as defined below) promoting, among other things, the Web Service, and subject to the terms and conditions of this Agreement, (a) CNN hereby grants to AOL and the Third Party Provider a nontransferable, nonsublicensable, worldwide, nonexclusive license to use and display trade names, trademarks, and service marks of CNN; and (b) AOL hereby grants CNN a nontransferable, nonsublicensable, worldwide, nonexclusive license to use and display the trade names, trademarks and service marks of AOL and the Third Party Provider (to the extent such rights are granted to AOL by the Third Party Provider) associated with the Web Service and the Promotional Materials (collectively, together with the CNN marks listed above, the “Marks”); provided that each Party: (i) does not create a unitary composite mark involving a Mark of the other Party without the prior written approval of such other Party; (ii) displays symbols and notices clearly and sufficiently Indicating the trademark status and ownership of the other Party’s Marks in accordance with applicable trademark law and practice; (iii) complies with all written guidelines provided to it by the other Party related to use of the other Party’s Marks, and (iv) obtains the other Party’s prior written approval (with e-mail being sufficient), which will not be unreasonably withheld or delayed.

4. Ownership of Trademarks. Each Party acknowledges the ownership right of the other Party in the Marks of the other Party and agrees that all use of the other Party’s Marks will inure to the benefit, and be on behalf, of the other Party. Each Party acknowledges that its utilization of the other Party’s Marks will not create in it, nor will it represent it has, any right, title, or interest in or to such Marks other than the. licenses expressly granted herein. Each Party agrees not to do anything contesting or impairing the. trademark rights of the other Party.

5. Quality Standards. Each Party agrees that the nature and quality of its products and services supplied in connection with the other Party’s Marks will conform to quality standards communicated in writing by the other Party for use of its trademarks. Each Party agrees to supply the other Party, upon request, with a reasonable number of samples of any Promotional Materials publicly disseminated by such Party which utilize the other Party’s Marks. Each Party will comply with all applicable laws, regulations, and customs and obtain any required government approvals pertaining to use of the other Party’s marks.

6. Infringement Proceedings. Each Party agrees to promptly notify the other Party of any unauthorized use of the other Party’s Marks of which it has actual knowledge. Each Party will have the sole right and discretion to bring proceedings alleging infringement of its Marks or unfair competition related thereto; provided, however, that each Party agrees to provide the other Party with its reasonable cooperation and assistance with respect to any such infringement proceedings.

7. Effort to Inform. CNN shall use commercially reasonable efforts to inform AOL of complaints CNN receives from CNN.com Users about the Sponsored Advertising Service or the Web Service which could reasonably lead to a claim, demand or liability of or against AOL or the Third Party Provider and/or its Affiliates by a third party. Notwithstanding the foregoing, CNN’s failure to provide notice under this Section shall not be deemed a breach of this Agreement.

8. Representations and Warranties. Each Party represents and warrants to the other Party that: (i) such Party has the full corporate right, power and authority to enter into this Agreement and to perform the acts required of it hereunder; (ii) the execution of this Agreement by such Party, and the performance by such Party of its obligations and duties hereunder, do not and will not violate any agreement to which such Party Is a party or by which it is otherwise bound; (iii) when executed and delivered by such Party, this Agreement will constitute the legal, valid, and binding obligation of such Party, enforceable against such Party in accordance with its terms; and (iv) such Party acknowledges that the other Party makes no representations, warranties or agreements related to the subject matter hereof that are not expressly provided for in this Agreement.

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9. Confidentiality.

(a) Definition. “Confidential Information” means any information disclosed in the course of this Agreement, which is or should be reasonably understood to be confidential or proprietary to the disclosing Party, including, but not limited to, the material terms of this Agreement, technical processes and formulas, source code, product designs, sales, cost and other unpublished financial information, product and business plans, projections and marketing data. “Confidential Information” will not include information that (i) was in the recipient’s possession before receipt from the disclosing Party; (ii) is or becomes a matter of public knowledge through no fault of the recipient; (iii) is rightfully received by the recipient from a third party without a duty of confidentiality; (iv) is independently developed by the recipient; (v) is disclosed pursuant to a legal requirement to disclose (including pursuant to federal or state securities laws), except that the recipient will disclose only such information as is legally required and will use reasonable efforts to obtain confidential treatment for any Confidential Information that is so disclosed; (vi) is disclosed by the recipient with the disclosing Party’s prior written approval; or (vii) is required to be disclosed in order to enforce the recipient’s rights under this Agreement in a court or arbitration proceeding (but in each case only to the extent of such requirement and only after consultation with the disclosing Party, and the recipient will use reasonable efforts to obtain, or assist the disclosing Party in obtaining, an order protecting the information from public disclosure).

(b) Obligation. Each Party acknowledges that Confidential Information may be disclosed to the other Party during the course of this Agreement. Each Party agrees that it will take reasonable steps, at least substantially equivalent to the steps it takes to protect its own proprietary information, during the Term of this Agreement and in perpetuity thereafter (with regard to personally identifiable information and non-published protocols) and for a period of three (3) years following expiration or termination of this Agreement (with regard to all other Confidential Information), to keep confidential and prevent the duplication or disclosure of Confidential Information of the disclosing Party, other than by or to its employees or agents, including accountants and auditors, that need access to such Confidential Information and who will each agree to comply with terms and conditions no less restrictive than those set forth in this Section 9; provided that nothing herein shall be deemed to require either Party to retain copies of personally identifiable information.

(c) Government Requirements. Notwithstanding the foregoing provisions of this Section 9, either Party. may disclose Confidential Information without the consent of the other Party, to the extent such disclosure is required by law, rule, regulation or government or court order, or in connection with the enforcement of this Agreement. In such event, the disclosing Party will provide at least five (5) Business Days prior written notice of such proposed disclosure to the recipient. Further, in the event such disclosure is required of either Party under the

laws, rules or regulations of the Securities and Exchange Commission or any other applicable governing body, such Party will (i) redact mutually agreed-upon portions of this Agreement to the fullest extent permitted under applicable laws, rules and regulations, and (ii) submit a request to the SEC or such governing body that such portions of this Agreement receive confidential treatment under the laws, rules and regulations of the Securities and Exchange Commission or otherwise be held in the strictest confidence to the fullest extent permitted under the laws, rules or regulations of any other applicable governing body.

(d) Press Releases. Neither Party shall issue any press release, or make any public statement, concerning the existence of this Agreement, the terms hereof or the activities contemplated hereunder (“Press Release”) without the prior written approval of the other Party. In the event a Party desires to issue a Press Release such Party shall submit to the other Party, for its prior written approval, any such Press Release; provided that, subsequent to the initial Press Release, if any, factual references by either Party to the existence of a business relationship between the Parties shall not require approval of the other Party.

(e) Promotional Materials. Each Party will submit to the other Party, for its prior written approval, any marketing, advertising, or other written promotional materials, excluding Press Releases (which are instead governed by Section (d) above), referencing the other Party and/or its trade names, trademarks, and service marks (the “Promotional Materials”); provided, however, that, following the initial public announcement of the business relationship between the Parties in accordance with the approval and other requirements contained herein, either Party’s subsequent factual reference to the existence of a business relationship between the Parties in Promotional Materials will not require the approval of the other Party. Once expressly pre-approved, the Promotional Materials may be used by a Party and its affiliates and re-used for such purpose until such approval is withdrawn with reasonable prior notice. In the event such approval is withdrawn, existing inventories of Promotional Materials may not be used.

10. Limitation of Liability; Disclaimer; Indemnification.

10.1 Liability.

NEITHER PARTY BE LIABLE TO THE OTHER PARTY FOR INDIRECT, INCIDENTAL, CONSEQUENTIAL, SPECIAL OR EXEMPLARY DAMAGES (EVEN IF THAT PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES), ARISING FROM BREACH OF THE AGREEMENT, THE SALE OF PRODUCTS, THE USE OR INABILITY TO USE CNN.COM, THE SEARCH RESULTS AREA OR ANY ONLlNE AREA RELATING THERETO, THE SPONSORED ADVERTISING SERVICE, ADVERTISING RESULTS, CNN SEARCH SERVICE, THE CNN SEARCH RESULTS, OR THE LICENSED CONTENT, OR ARISING FROM ANY OTHER PROVISION OF THIS. AGREEMENT, SUCH AS, BUT NOT LIMITED TO, LOSS OF REVENUE OR ANTICIPATED PROFITS OR LOST BUSINESS (COLLECTIVELY, “DISCLAIMED DAMAGES”); PROVIDED THAT EACH PARTY WILL REMAIN LIABLE TO THE OTHER PARTY TO THE

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EXTENT ANY DISCLAIMED DAMAGES ARE CLAIMED BY A THIRD PARTY AND ARE SUBJECT TO INDEMNIFICATION PURSUANT TO SECTIONS 5.4 OR 7.6 OF THE AGREEMENT AND 10.3 OF THIS EXHIBIT. EXCEPT AS PROVIDED IN SECTIONS 5.4 AND 7.6 OF THE AGREEMENT, AND 10.3 OF THIS EXHIBIT, (I) LIABILITY ARISING UNDER THE AGREEMENT WILL BE LIMITED TO DIRECT, OBJECTIVELY MEASURABLE DAMAGES, (II) THE MAXIMUM LIABILITY OF ONE PARTY TO THE OTHER PARTY FOR ANY CLAIMS ARISING IN CONNECTION WITH THE AGREEMENT WILL NOT EXCEED TWO TIMES THE TOTAL AGGREGATE VALUE OF CONSIDERATION PAID OR PAYABLE BY AOL TO CNN UNDER THE AGREEMENT; PROVIDED THAT EACH PARTY WILL REMAIN LIABLE FOR THE AGGREGATE AMOUNT OF ANY PAYMENT OBLIGATIONS OWED TO THE OTHER PARTY PURSUANT TO THE AGREEMENT. IF THERE IS A BREACH OF THE PROVISIONS REGARDING CONFIDENTIAL INFORMATION, THEN THE BREACHING PARTY MAY BE LIABLE FOR CONSEQUENTIAL DAMAGES, BUT NOT IN EXCESS OF THE CAP SET FORTH HEREIN.

10.2 No Additional Warranties. EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT, NEITHER PARTY MAKES ANY, AND EACH PARTY HEREBY SPECIFICALLY DISCLAIMS ANY, REPRESENTATIONS OR WARRANTIES, EXPRESS OR IMPLIED, REGARDING CNN.COM, THE CNN SEARCH SERVICE, THE SPONSORED LINKS SEARCH RESULTS AREA, THE WEB SEARCH RESULTS OR ANY ONLINE AREA RELATING THERETO, THE CNN SEARCH RESULTS, WEB SERVICE, THE SEARCH RESULTS, THE ADVERTISING SERVICE, THE ADVERTISING RESULTS, THE LICENSED CONTENT, OR THIS AGREEMENT INCLUDING ANY IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR NON-INFRINGEMENT AND IMPLIED WARRANTIES ARISING FROM COURSE OF DEALING OR COURSE OF PERFORMANCE. WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, CNN SPECIFICALLY DISCLAIMS ANY WARRANTY REGARDING THE PROFITABILITY OF (A) THE SPONSORED LINKS, (B) THE QUERIES, AND (C) THE USER ACTIONS.

10.3 Indemnity. Each Party will defend, indemnify, save and hold harmless the other Party and the officers, directors, agents, Affiliates. distributors, franchisees and employees of the other Party from any and all third party claims, and all liabilities, damages, costs or expenses, including reasonable attorneys’ fees (but excluding those attorneys’ fees that arise from an Indemnified Party’s (as defined below) decision to participate in its own defense at its expense) arising from such third party claims (collectively “Liabilities”), resulting from the indemnifying Party’s material breach or alleged material breach of any obligation, representation or warranty of this Agreement. In addition, AOL will defend indemnify, save and hold harmless CNN and its officers, directors, agents, Affiliates, distributors, franchisees and employees, from any Liabilities resulting from (i) displaying any Matched Results that are subject to

the First Level Filter or the Second Level Filter, including during any implementation periods with respect to updates thereof, and (ii) Slippage.

10.3.1. AOL IP Indemnity. In addition to the other provisions of this Section 10.3, AOL will defend, indemnify, save and hold harmless CNN and its officers, directors, agents, Affiliates, distributors, franchisees and employees from any Liabilities resulting from the infringement of or violation, or alleged infringement or violation of, any copyright, trademark U.S. patent or any other third party right, including without limitation, any music performance or other music related rights in connection with the Licensed Content and the Sponsored Advertising Service.

10.3.2. CNN Filter Indemnity. CNN shall defend, indemnify, save and hold harmless AOL and its officers, directors, agents, Affiliates, distributors, franchisees and employees from any Liabilities to the extent caused directly and Solely by the Keyword Filter and the URL filter (excluding, however, the Keyword Filter and URL filter provided by AOL to CNN pursuant to Section 2.10(d) of the Agreement) provided that (a) CNN expressly requested that AOL employ the Keyword Filter or URL filter that causes the Liabilities (the “Requested Filter”), (b) AOL complies with all the terms of this Agreement in deploying the Requested Filter, and (c) AOL does not have filters in place aimed at filtering the same or substantially similar Licensed Content from AOL’s Web Sites.

10.3.3. THE FOREGOING PARAGRAPHS 10.3, 10.3.1 AND 10.3.2 OF THIS EXHIBIT E AND SECTIONS 5.4 AND 7 IN THE BODY OF THE AGREEMENT STATE EACH PARTY’S ENTIRE LIABILITY (AND EACH PARTY’S SOLE AND EXCLUSIVE REMEDIES) FOR THIRD PARTY CLAIMS ARISING UNDER THIS AGREEMENT, EXCEPT FOR ANY CLAIMS FROM THE THIRD PARTY PROVIDER AGAINST CNN.

10.4 Claims. If a Party entitled to indemnification hereunder (the “Indemnified Party”) becomes aware of any matter it believes is indemnifiable hereunder involving any claim, action, suit, investigation, arbitration, or other proceeding against the Indemnified Party by any third party (each an “Action”), the Indemnified Party will give the other Party (the “Indemnifying Party”) prompt written notice of such Action. Such notice will (i) provide the basis on which indemnification is being asserted and (ii) be accompanied by copies of all relevant pleadings, demands, and other papers related to the Action and in the possession of the Indemnified Party. The Indemnifying Party will be obligated to defend the Action, at its own expense, and by counsel reasonably satisfactory to the Indemnified Party. The Indemnified Party will cooperate, at the expense of the Indemnifying Party (except for the value of time of the Indemnified Party’s employees), with the Indemnifying Party and its counsel in the defense and the Indemnified Party will have the right to participate fully, at its own expense, in the defense of such Action. Any compromise or settlement of an Action that requires the Indemnified Party to admit liability or to pay any money will require the prior written consent of the Indemnified Party, such consent not to be unreasonably withheld or delayed.

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11.    Acknowledgment. AOL and CNN each acknowledges that the provisions of this Agreement were negotiated to reflect an informed, voluntary allocation between them of all risks (both known and unknown) associated with the transactions contemplated hereunder. The limitations and disclaimers related to warranties and liability contained in this Agreement are intended to limit the circumstances and extent of liability. The Parties agree that .any principle of construction or rule of law that provides that an agreement shall be construed against the drafter of the agreement in the event of any inconsistency or ambiguity in such agreement shall not apply to the terms and conditions of this Agreement. The provisions of this Section 11 will be enforceable independent of and severable from any other enforceable or unenforceable provision of this Agreement

12.    Excuse. Neither Party will be liable for, or be considered in breach of or default under this Agreement on account of, any delay or failure to perform as required by this Agreement as a result of any causes or conditions which are beyond such Party’s reasonable control and which such Party is unable to overcome by the exercise of reasonable diligence, except that, to the extent expressly stated herein, as between AOL and CNN, AOL shall be responsible for the actions of the Advertisers.

13.    Independent Contractors. The Parties to this Agreement are independent contractors. Neither Party is an agent, representative or employee of the other Party. Neither Party will have any right, power or authority to enter into any agreement for or on behalf of, or incur any obligation or liability of, or to otherwise bind, the other Party. This Agreement will not be interpreted or construed to create an association, agency, joint venture or partnership between the Parties or to impose any liability attributable to such a relationship upon either Party. .

14. Notice.

All notices shall be in English, in writing, and shall be deemed given (i) upon receipt when delivered personally, (ii) upon written verification of receipt from overnight courier, (iii) upon verification of receipt of registered or certified mail, or (iv) upon verification of receipt via facsimile, provided that such notice is also sent simultaneously via U.S. mail. In the case of AOL, such notice will be provided to both the Executive Vice-President of Business Development for AOL (fax: 703-265-0242) and the Deputy General Counsel (fax:703-265-8433), each at 22000 AOL Way, Dulles, VA 20166 or as otherwise provided in writing for such notice purposes. In the case of CNN, such notice will be provided to both David Payne, Senior Vice President and General manager CNN.com (fax:. 404-827-2150) and its General Counsel (fax: 404-827-1995), each at One CNN Center, Atlanta, Georgia 30303 or as otherwise provided in writing for such notice purposes.

15.    No Waiver. The failure of either Party to insist upon or enforce strict performance by the other Party of any provision of this Agreement or to exercise any right under this Agreement will not be construed as a waiver or relinquishment to any extent of such Party’s right to assert or rely upon any such provision or right in that or any other instance; rather, the same will be and remain in full force and effect.

16.    Return of Information. Upon the expiration or termination of this Agreement, each Party will, upon the written request of the other Party, return or destroy (at the option of the Party receiving the request) all Confidential Information, documents, manuals and other materials specified by the other Party.

17.    Survival.

Sections 2.10(i), 2.10(j), 2.10(k) 6.6, 6.7 (Effect of Termination), and 7 (Relationship between AOL and Advertisers) of the body of the Agreement and Exhibit A, Sections 9-29 of this Exhibit E, Exhibit G, any payment obligations accrued prior to or upon termination or expiration, the obligations of AOL with respect to the use and retention of data in the Preamble to Schedule 2.1, and any other terms .and provisions of this Agreement needed to interpret or make the foregoing operative (except as set forth in such supplementary paragraph), will survive the completion, expiration, termination or cancellation of this Agreement

18.    Entire Agreement. This Agreement sets forth the entire agreement, and is a complete integration, and supersedes any and all prior agreements and statements of intent of the Parties with respect to the transactions set forth herein. Neither Party will be bound by, and each Party specifically objects to, any term, condition or other provision which Is different from or in addition to the provisions of this Agreement (whether or not it would materially alter this Agreement) and which is proffered by the other Party in any correspondence or other document, unless the Party to be bound thereby specifically agrees to such provision in writing.

19.    Amendment. No change, amendment or modification of any provision of this Agreement will be valid unless set forth in a written instrument signed by the Party subject to enforcement of such amendment, and in the case of AOL, by an executive of at least Vice President level.

20.    Further Assurances. Each Party will take such action (including, but not limited to, the execution, acknowledgment and delivery of documents) as may reasonably be requested by any other Party for the implementation or continuing performance of this Agreement.

21. Assignment

Neither Party will assign this Agreement or any right, interest or benefit under this Agreement (including, without limitation, by way of merger or consolidation) without the prior written consent of the other Party (not to be unreasonably withheld). Subject to the foregoing provisions of this Section 21, this Agreement will be fully binding upon, inure to the benefit of, and be enforceable by the Parties hereto and their respective successors and assigns. A Change of Control as defined in Exhibit A will be governed by Section 6.4 and not by this Section 21.

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22.    Construction: Severability. In the event that any provision of this Agreement conflicts with the law under which this Agreement is to be construed or if any such provision is held invalid by a court with jurisdiction over the Parties to this Agreement, (i) such provision will be deemed to be restated to reflect as nearly as possible the original intentions of the Parties in accordance with applicable law, and (ii) the remaining terms, provisions, covenants and restrictions of this Agreement will remain in full force and effect.

23.    Remedies. Except where otherwise specified, the rights and remedies granted to a Party under this Agreement are cumulative and in addition to, and not in lieu of, any other rights or remedies which the Party may possess at law or in equity.

24.    Applicable Law:

This Agreement and the rights of the Parties hereto shall be interpreted in accordance with the laws of the State of New York, and all rights and remedies shall be governed by such laws without regard to principles of conflicts of laws. Each of the Parties hereto irrevocably agrees that any legal action or proceeding arising out of this Agreement or any transaction contemplated hereby shall be brought only in the State or United States Federal courts located in the State of New York. Each Party hereto irrevocably consents to the service of process outside the territorial jurisdiction of such courts in any such action or proceeding by the mailing of such documents by registered United States mail, postage prepaid, to the respective address set forth In Section 14 hereof.

25.    Export Controls. Each Party shall comply with all applicable laws, regulations, and rules relating to the export of commodities, software or technical data, and shall not export or re-export any commodities, software, technical data, any products received from the other Party, or direct

product of such commodities, software or technical data, to any proscribed country, party, or entity listed in such applicable laws, regulations, and rules, unless properly authorized by the U.S. Government.

26. Headings. The captions and headings used in this Agreement are inserted for convenience only and will not affect the meaning or interpretation of this Agreement.

27. Counterparts; Facsimile. This Agreement may be executed in counterparts, each of which will be deemed an original and all of which together will constitute one and the same document. This Agreement, and written amendments hereto, may be executed by facsimile.

28. Injunctive Relief. Notwithstanding anything to the contrary in this Agreement, the Parties agree that any material breach or threatened material breach of the provisions of this Agreement related to exclusivity, intellectual property rights or confidentiality obligations, may cause irreparable harm to the other Party for which money damages might be difficult to determine and an inadequate remedy, and therefore an aggrieved Party may timely seek injunctive relief without the need to prove actual damages to protect its rights under this Agreement, in addition to any and all other remedies available at law or in equity.

29. No Third Party Beneficiaries. The Agreement is not intended to benefit, nor shall it be deemed to give rise to, any rights in any third party (including but not limited to any subsidiary or Affiliate of either Party hereto).

30. Third Party Provider. AOL will ensure the performance of, and be responsible for, all obligations under this Agreement that are to be performed by the Third Party Provider, and AOL shall be liable, to the extent set forth in this Agreement, for all acts, errors and omissions of the Third Party Provider that are in violation of this Agreement.

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EXHIBIT F

COMMERCIAL LINKS

1. Display of Additional Matched Results. Pursuant to Section 2.1.3 of this Agreement, in addition to the minimum number of Matched Results required by the Sponsored Links Required Characteristics, CNN shall have the right (but no obligation) to request from the Third Party Provider one or more additional Matched Results for display as Sponsored Links in the Sponsored Links Search Results Areas on CNN.com (such Matched Results, the “Additional Matched Results”). Unless otherwise mutually agreed to by the Parties in writing, the Additional Matched Results will be served by the Third Party Provider. For the avoidance of doubt: (x) CNN will have the right to completely discontinue or suspend all requests for Additional Matched Results at any time by providing AOL with two (2) Business Days advance written notice (which written notice may be in the form of email), or in the event CNN wishes only to change the quantity of Additional Matched Results requested (higher or lower), CNN may do so at any time by providing AOL with six (6) Business Days advance written notice (which written notice may be in the form of email), subject, however, to CNN’s right to completely discontinue or suspend all requests for Additional Matched Results as set forth under this subsection (x); and (y) subject to the other terms of this Exhibit F (e.g., CNN’s right to cease requesting Additional Matched Results for any reason), Section 2.1.3 of the main body of this Agreement will govern the general processes regarding the Additional Matched Results.

2. Application of Relevant Terms and Conditions to Additional Matched Results. For the avoidance of doubt, all terms and conditions of the Agreement applicable to the Sponsored Links and Matched Results shall apply to the Additional Matched Results, e.g., including without limitation the Protocol described in Section 2.1 of the main body of this Agreement.

3. Tracking and Reporting of Additional Matched Results. All reports required to be provided by AOL under this Agreement shall be inclusive of data relating to the Additional Matched Results.

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EXHIBIT G

USER REGISTRATION AND PRIVACY

USE OF PERSONAL DATA

CNN shall solely own and use all CNN.com User data and information obtained in connection with this Agreement (“CNN User Information”). Except to the extent expressly set forth in Section 2.10 (j) of this Agreement, AOL shall not disclose to any third party (except the Third party Provider) such CNN User Information without CNN’s prior written approval in its sole discretion. The Parties acknowledge that it is the intention of both Parties that neither AOL nor the Third Party Provider collect and CNN not convey to AOL or the Third Party Provider any personally identifiable information in connection with the Web Service. AOL and the Third Party Provider shall adhere to CNN’s then-current privacy policies with respect to activity on CNN.com. If CNN determines that AOL or the Third Party Provider or a third party in contract with AOL is not complying with such CNN policies with respect to such activity on CNN.com, then such non-compliance shall be considered a material breach of this Agreement.

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EXHIBIT H

SPONSORED LINKS REQUIRED CHARACTERISTICS MOCK-UPS

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EXHIBIT I

THIRD PARTY BRANDING MOCK-UP

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SCHEDULE 1

PROHIBITED ENTITIES

CAREER URLs	COMPETITOR URLs	OTHER URLs	KEYWORDs
a10minuteresume.com 123jobs.com 123movers.com 1greatresume.com 1on1resumes.com 1st-imp.com 1worldresources.com 4work.com 6figurejobs.com aaamovers.com acareerzon.com actautostaffing.com adecco.com adicio.com advancedcareercounseling.com aeroindustryjobs.com aftercollege.com agentrecruiting.com ajb.org ajcjobs.com all-trucking-jobs.com allretailjobs.com allstardirectoriesamericasjobbank.com ama.jobcontrolcenter.com americanjobs.com americasemployers.com atlantajobpost.com attorneyrecruiting.net bankjobs.com bdojobs.com beitlerstaff.com bestjobsusa.com betheboss.com bigfivepros.com bigwigs.net	http://bbc.com/ http://bbc.co.uk/ http://msnbc.msn.com/ http://news.google.com/ http://news.yahoo.com/ http://washingtonpost.com http://www.abcnews.com/ http://www.ap.org/ http://www.cbsnews.com/ http://www.cnbc.com/ http://www.cnet.com/ http://www.c-span.org/ http://www.ew.com/ http://www.forbes.com http://www.foxnews.com/ http://www.guardian.co.uk/ http://www.msnbc.com/ http://www.prnewswire.com/ http://www.reuters.com/ http://www.upi.com/ http://www.usatoday.com/ http://www.usnews.com/ http://www.weather.com/ http://www.wsj.com/		jobs job career careers job jobs job-search employment resume resumes workforce hired employee employment recruiting staffing career careers employment employ BBC MSN MSNBC Yahoo Yahoo News Google News Washington Post ABC ABC News ABCNews Associated Press AP CBS CBS News

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bluefoxjobs.com   boldfacejobs.com   brassring.com   brilliantpeople.com   campjobs.com   canalstreettalent.com   candocareer.com   care-orps.com   career-edu.com   career.bioexchange.com   career.com   career.org   careeradvancementservices.com   careerandresume.com   careeravenue.com   careerbank.com   careerboard.com   careerbuilder.com   careercast.com   careerchange.com   careercity.com   careerfish.com   careerinventory.com   careeriq.com   careerjournal.com   careermagazine .com   careernet.com   careeroverview.com   careerpath.com   careerperfect.com   careerpro.com   careers.edegree.org   careers.msn.com   careers.org   careers.yahoo.com   careerscape.com   careersite.com   careersmultilist.com.au   careerspan.com   careerzapper.com CBSNews   CNBC   C-Span   Cspan   Entertainment Weekly   EW   Forbes   Fox   Fox News   FoxNews   Guardian UK       PR Newswire   PRNewswire   Reuters         UPI   USA Today   USAToday   US News and World Report   Wall Street Journal

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careerzeekers.com

cdldriverswanted.net

chef2chef.net

chefjobs.com

chiefpeople.com

clubjobs.net

collegegrad.com

colorado,jobing.com

coloradojobs.com

computercareers.net

computerjobs.com

computerjobsworkathome.com

computerwork.com

corpsearch.com

csi-personnel.com

dcjobnetwork.com

destinationstaffing.com

developercareers.com

dice.com

drivercareers.com

earningontheweb.com

easyjob.net

ekonomijobb.se

elance.com

elance.com.hk

elsevierhealthcareers.com

employment-job-search.net

employment911.com

employmentguide.com

employmentwizard.com

ework.com

eworkmarkets.com

execresumes.com

execu-search.com

execunet.com

executive-advisors.com

executiveresumepro.com

exercisejobs.com

fabjob.com

filmstaff.com

fincareer.com

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findatruckingjob.com

findgreatpeople.com

findyourspot.com

firecareers.net

firerecruit.com

fish4jobs.co.uk

flipdo.com

flipdog.com

floridacareers.us

gapcareers.co.uk

getahead-direct.com

getinterviews.com

governmentaljobs.com

gravitypeople.com

greatnurse.com

gsajobmarket.com

gymjob.com

hbcucareercenter.com

hcareers.com

headhunter.net

health-care-careers.org

healthandwellnessjobs.com

healthecareers.com

heidrick.com

heidrickstruggles.com

hightechcareers.com

hire.com

homeemployed.com

hospitaljobsonline.com

hotcdljobs.com

hotelcareersolutions.com

hotjobs.com

hotjobs.yahoo.com

hotjobspider.com

hotrecruit.co.uk

howtogetyourdreamjob.com

hrjunction.com

hundredk.com

hurleysearch.com

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in.jobstreet.com

indeed.com

infoedge.com

infojobs.it

interplacement.com

itcareers.com

job-hunt.org

job-interview.net

job-opportunities.net

job.com

jobbankusa.com

jobbmatchning.dn.se

jobboards.com

jobbsafari.se

jobcenter.com

jobengine.com

jobfind.com

jobforest.com

jobguru.com

jobgusher.com

jobing.com

joboptions.com

jobpilot.com

jobs-on-monster.com

jobs.com

jobscience.com

jobsearch.com

jobsearch.lu

jobsearch.monster.com

jobsearchworkbench.com

jobsfortruckers.com

jobsinme.com

jobsinnh.comhome

jobsinsports.com

jobsinthemoney.com

jobsite.com

jobsmart.com

jobsnake.com

jobsniper.com

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jobsonline.com

jobster.com

jobsummit.com

jobtrak.com

jobvertise.com

jobweb.com

jonesinternational.edu

journeyed.com

justinjobs.com

kenexa.com

kornferry.com

landjob.com

lawjobs.com

layoffengineers.com

leadersonline.com

leisurejobs.com

lucascareers.com

manpower.com

manpower.se

maximumpayjobs.com

mbajobfind.com

medhunter.com

medhunters.com

minnesotajobs.com

monster.com

monstertrak.com

nationjob.com

nationsjob.com

needtechs.com

net-tamps.com

nettemps.com

newjobs.comphealth.com

nursajobz.com

nutritionjobs.com

nytimes.com

officeworksrx.com

oilandgasjobsearch.com

oilcareer.org

pcrecruiter.com

pharmjobdirect.com

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pilotcareercentre.com

preferredjobs.com

prohire.com

quintcareers.com

radcareers.com

readyrecruit.com

regionalhelpWanted.com

rehabjobs.com

restaurantjobs.com

richertoday.com

rntravelerjobs.com

roberthalf.com

rtc-employment.com

salary.com

sales-search.com

saljjobb.se

sciencejobs.com

scjobmarket.com

scripps.com

searchceo.com

simplyhired.com

skillsvillage.com

snagajob.com

starttodayjobs.com

swapjobs.com

talentmanager.it

techemployment.com

teknikjobb.se

theladders.com

therecruiternetwork.com

top-execs.com

topusajobs.com

tradesworker.com

traveltherapyjobs.com

trovojob.it

truckdriver.com

truckersearch.com

truecareers.com

usnews.com

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washingtonjobs.com

washingtonpost.com

wetfeet.com

wisconsinjobnetwork.com

worathome-employment.com

work4agoodcause.com

workathome-employment.com

workathomejobs.com

workathomesearchengine.com

workskillsprofessionals.com.au

workthing.com

yahoocareers.com

youapplyhere.com

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SCHEDULE 2.1

SCHEDULE 2.1

Ads Protocol and Protocol Implementation Process

Preamble

CNN will use the data protocol interface described in Section 1 below (the data described in Section 1 below referred to as the “Shared Data”) , in order to allow The Third Party Provider to (a) provide the Sponsored Advertising Service as required under this Agreement (including providing such information to a Metric Auditor to the extent required by Section 5.5(d) of the Agreement), (b) detect Spam, and (c) use such data in aggregate form (e.g., combined with data provided by multiple Third Party Provider distribution partners or customers (“Aggregated Data”) and in a manner that prevents (i) individual identification of CNN.com Users, their personal information (if any) or the fact that such end-users are CNN.com Users, or (ii) identification of groups or sets of end-users as users of products or services, as applicable, on CNN.com (other than for Spam detection)) for non-competitive purposes] (e.g., determining the most popular search terms)((a) through (c) being the “Designated Purposes”). AOL expressly recognizes that, notwithstanding anything to the contrary in this Schedule 2.1:

(a) CNN may elect not to provide the Shared Data, but if CNN elects to provide the Shared Data, CNN is only obligated to provide the Shared Data if and to the extent not personally identifiable (e.g., such that the portions of the Shared Data (e.g., cip) may be masked with a one-way hash (or otherwise masked) at CNN’s option); provided, however that CNN shall not be relieved of its obligation under the Agreement to submit Queries or display Sponsored Links, except as otherwise provided in the Agreement. If CNN elects to provide the end-user portions of the Shared Data it will do so as a one-way hash (and neither AOL nor the Third Party Provider will unmask such Shared IP Data). The one-way hash contemplated herein will be on a “one-to-one” basis, such that different source IP addresses will be assigned different codes, and the same source IP address will be assigned the same code. Ads cannot be geo-targeted without the provision of relevant zip code. Unless CNN elects to provide such relevant zip codes or other geo-targeting related information, AOL shall not be deemed in breach of Section A of Exhibit C of this Agreement to the extent AOL is unable to do so due to CNN’s election not to provide relevant zip codes or other geo-targeting related information. To the extent CNN makes available geo-targeting information, AOL will ensure that the Third Party Provider will use this data only for one-time targeting (i.e. only to serve the appropriate geo-targeted Sponsored Links in that one instance).

(b) For the avoidance, of doubt, CNN is never required to provide data kept in an end-user cookie (“Cookie Data”), and if CNN does provide Cookie Data then CNN may encrypt such Cookie Data at its option.

(c) AOL shall ensure that the Third Party Provider shall: (i) use the Shared Data solely for the Designated Purposes; (ii) not disclose the Shared Data to any third party other than (x) the Metric Auditor (to the extent required by Section 5.5(d) of the Agreement) and (y) Third Party Provider’s third-party agents solely for the Designated Purposes, subject to the confidentiality requirements and other restrictions on use set forth in the Agreement; (iii) only keep the Shared Data during the time in which it keeps the logs containing such Shared Data in the ordinary course of its business; (iv) keep the Shared Data under controlled access (i.e. in a manner which ensures that such data is not disclosed to any third party(except as described in this paragraph (c)) or made available to unauthorized personnel); and (v) not attempt to determine any personally identifiable information underlying of forming the basis of the Shared Data, For the avoidance of doubt, to the extent Third Party Provider’s other distribution partners or customers or their auditors are permitted to audit the non-CNN related Aggregated Data kept on Third Party Provider’s logs, AOL shall ensure that the Third Party Provider extracts the relevant data (i.e., not the Shared Data) from such logs and provides reports thereof in connection with such audits, but does not provide such third parties access to Shared Data provided by CNN.

(d) The “cip” data listed in the fifteenth line of chart 2 in Section 1.1 below are required only to the extent such information is readily available to CNN and to the extent that CNN elects to provide the same (e.g., source ip may not be available).

(e) The description of “cip” data listed in the fifteenth line of Chart 2 in Section 1.1 below shall be deemed to expressly exclude those X-Forwarded-For HTTP headers that are in the internal CNN path.

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(f) All items labeled as “Notes” are suggestions only, and CNN will not be liable for any failure to comply therewith.

(g) Note: Because the Third Party Provider relies on the ip parameter (IP address), AOL hereby advises CNN that providing the values of these parameters is necessary to have maximum protection against ad “spamming”.

(h) The Parties have agreed to filtering requirements in Section 2.8 of the main body of this Agreement. In connection with the filtering to be done in connection with such Section, listing a URL will block all sub-pages of the primary domain. For example:

Blocking www.guns.com, will automatically block www.guns.com/buygunshere

(i) CNN shall have up to 60 days from the Effective Date to implement the Protocols in this Agreement, subject to any circumstances beyond its reasonable control.

(j) AOL shall ensure that the Third Party Provider shall, upon each UA, be permitted to use “cookie” or web beacon technology (collectively, “Cookie Technology”) on a non-personally identifiable basis for the sole purposes of leveraging ad effectiveness functionality for an Advertiser relating click through events to conversions on the Advertiser’s Advertiser Web Site(s) (or the site of the relevant Advertiser’s third party agent) and similar return on investment (“ROI”) analysis of such Advertiser with respect to such Advertiser’s Sponsored Links delivered under this Agreement on a per click-through event basis, as well as aggregating such UAs with other UAs and/or other click-throughs across the Third Party Provider Advertising Network and other targeted text link monetization services of the Third Party Provider for conversion and similar ROI analysis (e.g., The Third Party Provider shall not build a profile of a CNN User with respect to the type of ad that is effective for such CNN User, or such CNN User’s buying habits, etc)(collectively, the “Permitted Cookie Uses”), provided that: (i) AOL is in compliance with the Agreement and any reasonable requirements set forth by CNN and disclosed to AOL in writing (which may be by email), including but not limited to rich media serving terms, submission requirements, etc., and (ii) the Third Party Provider provides access to Sponsored Links hereunder in accordance with generally recognized industry standards (e.g., click through functionality, description of placement of “cookies” on a browser and how “cookies” are read through hypertext transfer protocol (i.e., “HTTP”) headers). Notwithstanding anything to the contrary, such use of Cookie Technology on CNN.com shall not include the following activities:

(a) the collection of CNN.com User Navigational Data, or the aggregation, co-mingling or any other combination of data for or about CNN Users with data from other sites for the purpose of building profiles of CNN.com Users (regardless of whether such profiles were created outside of CNN.com), or for use in online preference marketing to CNN.com Users;

(b) aggregation, use or disclosure of Navigational Data obtained through the use of such technology;

(c) disclosure of or association by or on behalf of the Third Party Provider with any personally identifiable information of an CNN.com User;

(d) use or conducting of survey-based research without the prior written approval of CNN; and

(e) redirection or disclosure of data or information to a third party absent the express prior written approval by CNN (other than aggregate, non-personally identifiable data regarding conversions and other similar ROI analysis and/or spam, which may be disclosed to each relevant Advertiser or Advertiser’s Agent or others provided that such aggregate data could not reasonably be used to identify conversions on CNN.com).

For purposes of this Agreement, “Navigational Data” shall mean any data regarding CNN.com User navigation (e.g., destinations, clickstream, etc.) online, but excluding data which solely relates to whether (and, if so, when) a user who clicked on a Sponsored Link subsequently converts on the relevant Advertiser’s Advertiser Web Site(s) (or the site of the relevant Advertiser’s third party agent).

Restrictions on Use of CNN.com Information. Neither AOL nor the Third Party Provider shall (i) use any information or data gathered in connection with serving Sponsored Links to or through CNN.com (the “CNN.com Information”) in any manner whatsoever except as expressly permitted by the terms of this Agreement, nor (ii) communicate any CNN.com Information (or any portion thereof) to any individual or entity (other than aggregate, non-personally identifiable data regarding conversions and other similar ROI analysis and/or spam, which may be disclosed to each relevant Advertiser or Advertiser’s Agent or others provided that such aggregate data could not reasonably be used to identify conversions on CNN.com).

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AOL and the Third Party Provider shall maintain complete, clear and accurate records of all uses of CNN.com Information obtained through the use of Cookie Technology, including the collection, recording, organization, storage, adaptation, alteration, retrieval, consultation, alignment or combination, blocking, erasure or destruction of CNN.com Information and Aggregated Client Information, and of any permitted (if any) disclosure or otherwise making available of CNN.com Information (collectively, the “Privacy Records”).

All such privacy Records shall be maintained for a minimum of three (3) years following termination of this Agreement, except with respect to data or information for which the Third Party Provider has a company-wide policy for periodic purging of such data (which purging shall not occur more frequently than once during any six (6) month period) and information, which policy shall be provided to CNN upon request.

CNN shall have the right to direct a mutually agreeable independent third party privacy auditor, which auditor must be a nationally recognized auditing firm (a “Privacy Auditor”) to generate a report regarding Third Party Provider’s use of Cookie Technology and the collection and use of CNN.com Information, subject to confidentiality restrictions consistent with those set forth in this Agreement (and any additional confidentiality restrictions as mutually agreed), to conduct reasonable and necessary copying and inspection of Privacy Records. Any such audit may be conducted after twenty one (21) Business Days prior written notice, during normal business hours, no more than once per Year, and shall be at CNN’s expense; provided, however, that if an inspection reveals any violation of the terms and conditions set forth in this Preamble, (i) AOL shall promptly reimburse CNN for the reasonable fees charged by the Privacy Auditor, and (ii) CNN shall thereafter have the right to conduct more frequent audits during the Term, subject to this Section, provided, however that the total number of audits shall not exceed a total of two (2) per Year.

AOL shall comply with, and shall ensure that the Third Party Provider shall comply with, CNN directions and policies regarding the collection, storage and destruction of IP addresses that AOL and the Third Party Provider encounters in connection with this Agreement. Specifically, AOL shall ensure that: (a) IP addresses remain at all times encrypted when in the possession or storage of the Third Party Provider or its agents; and (b) other than the Permitted Cookie Uses and the Designated Purposes, the Third Party Provider will not use the IP addresses for any other purpose without the prior written consent of CNN, which may be given in CNN’s sole discretion.

Notwithstanding the foregoing or anything contained in this Schedule 2.1, the Designated Purposes and any other uses of data collected pursuant to this Schedule 2.1 shall not include any uses not permitted of Service Data under Section 2.10(j) of the Agreement, without the prior written consent of CNN, and the Shared Data and all other data collected under this Schedule 2.1 shall be owned as provided for Service Data under Section 2.10(j) of the Agreement.

*        *        *

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Note: This document describes protocol features specific only to ad requests and results.

Section 1

SLM Ad Interface

Overview

SLM (Sponsored Links Manager) serves Sponsored Links and/or Web Offers, both of which are just textual advertisements. This document describes the API used to obtain query-relevant ads.

SLM serves ads from a variety of advertising partners and aggregators, as defined by the particular needs of a given partner or ad consumer. A major partner is the Third Party Provider, and some the Third Party Provider terms are used in this description. A SLM Profile must be configured by AOL in order for a partner to issue these ad calls with an approved ID, and this configuration may specify advertising partners, and default behavior such as locale -language and country.

• There are 2 methods to retrieve sponsored links from SLM - XML and HTML. These methods provide flexibility in how the links may be brought into content pages through backend server functions.

• An Ad Request is an HTTP GET command. Here’s a sample test URL (not intended for any load). http://switcher.dmn.aol.com/sw/a?sch=dmn&ssch=test_aol_sports&squery=realtors&snum=10

• All parameters must be URL encoded for reliable transmission.

• Channels can set default values for optional parameters.

• For Server to Server requests (XML Response), SLM supports optional IP-based authentication

• The following request parameters are supported by SLM:

• Query related ads parameters

• Content related ads parameters

• Error related ads parameters

• Common parameters

Ad Types

SLM supports retrieval of matching ads which are determined to be relevant based on the following kinds of input parameters:

a) A specified query term, typically entered by an end-user.

b) An input keyword and/or URL typically entered by a channel devoted to specific topic.

c) A standard http error code (usually a DNS error).

Section 1.1

Matching Query Terms-Chart 1

For channels that supply a “query” term for which they want relevant ads. In the Third Party Provider terms, “AFS” (AdSense for Search) channels.

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Name	Required	Default Value	Channel can specify default	Description
Sch	Yes		Asd	Channel id assigned by SLM, passed by the partner on each API invocation
Ssch	Yes		Yes	Sub-channel id assigned by SLM, passed by the partner
squery	Yes		Yes	Search string as typed by user
Other SLM parameters-Chart 2
Other SLM parameters, independent of the kind of ads
Name	Required	Default Value	Channel can specify default	Description
snum		10	Yes	Number of ads requested
of		xml	Yes	“Output Format for the result (response) – xml & html are supported types”
stest		off	Yes	Test mode
locale		En_US	Yes	Country and language
z				Zip code for user
page		0	Yes	Page number of the ad distribution recipe.
nt				Value returned from previous request specifying how to get the next set of ads for same query
lf		0	Yes	Local Ad Filter: 0 – Retrieve both local/national advertisers. 1 – only local. 2 – only national
css			Yes	HTML API only – URL to the css to be applied to the unordered list of results
ssafe		high	Yes	Safety mode
sh_ie		UTF-8	Yes	Input encoding
sh_oe		UTF-8	Yes	Output encoding
sclient			Yes	Google Client Id
spch			Yes	Google Channel Id
cip				IP address of client
cru				Referrer URL
csp			Yes	Connection Speed
cua				Browser user agent string
scoco		usa	Yes	Country code of user
sbrand		aol	Yes	Brand of user
sview		web	Yes	Web or aol
sit			Yes	Promotional page/page position tracking
city			Yes	City for user.*
state			Yes	State for user. It must be in two letter format. For example CA for California, NM for New Mexico.*
sl_cat			Yes	The category under which the query has been classified; used to select Suppliers (“recipe”) to serve ads from; sl_cat=adult is the only category specified as of 08072006; unrecognized sl_cat will lead to the serving of ads from the “default” suppliers for the channel.

* city and state will only be used if zip code is not provided.

Testing with Google Ads

It’s essential when testing with the Third Party Provider to separate queries issued for preliminary testing and validation from queries issued in a production environment. During testing, all queries to SLM must include the parameter adtest,

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by appending it to the URL, in this format

&adtest=on

This indicates that the query is not to be counted as production traffic. Naturally, this parameter must be removed at the time of launch.

For example, the test URL shown above must be augmented for the Third Party Provider testing as shown here.

http://switcher.dmn.aol.com/sw/a?sch=dmn&ssch=test_aol_sports&squery=realtors&snum=10&adtest=on

Glossary

This glossary contains definitions of acronyms and terms that may be new to some readers.

Geo-Targeting – The Third Party Provider Search Engine contains the technology to determine the origin of a search request based on the user’s IP address or other relevant geographical information. Using this information, the Third Party Provider search requests can be configured to return either search or ad results limited to the user’s country or location.

2. Protocol Implementation Process.

2.1 Changes and Updates.

(1) The Third Party Provider reserves the right to make changes or updates to the Protocol implemented by CNN and the Third Party Provider set forth in this Schedule 2.1 or replace such Protocol with a new version, including without limitation, such changes, updates or replacements that enable new features or functionality of the Sponsored Advertising Service (collectively, “Updates”), in each case, subject to the mutual agreement (in writing) of CNN. CNN and AOL will (and AOL shall ensure the Third Party Provider will) work in good faith to reach mutual agreement on each such Update as soon as is reasonably possible, and to the extent that a particular issue concerning any proposed Update arises pursuant to which CNN reasonably withholds its mutual agreement (e.g., CNN User privacy), the Parties will, to the extent commercially practicable, modify and implement such Update to address such issues. For the avoidance of doubt, CNN’s reasonable objections to any component of a particular Update (“Specific Objections”) shall not affect the implementation of any mutually agreed components of such Update to the extent that such implementation is commercially practicable in light of the Specific Objections.

(2) Notwithstanding the foregoing, the Third Party Provider shall not be prohibited from making any Updates available to its other partners so long as the Third Party Provider also offers such Updates to CNN in compliance with subpart (1) above. For the avoidance of doubt, even in the event the Parties fail to reach mutual agreement as to any Update as set forth in subpart (1) above, AOL will not be in breach of Section A of Exhibit C of this Agreement as the result of providing such Updates to its partners.

(3) Without limitation of AOL’s rights under subpart (2) above, if CNN, AOL and the Third Party Provider are unable to reach mutual agreement with respect to any Updates to the Protocol within 30 days of the Third Party Provider’s request for implementation, then the matter shall be referred to the Management Committee for resolution in accordance with Exhibit E.

2.2. [intentionally omitted]

2.3. Support Requests. CNN will use commercially reasonable efforts to respond to and provide a fix for errors as reported by AOL and the Third Party Provider.

Contacts unless updated by written notice:

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Minor problems:

Email describing problem should be sent to CNN.com, e-mail: dermot.waters@tumer.com and tel. 404-878-5832

Major Problems:

If immediate attention is required call the CNN Network Operations Center, E-mail: noc-ops@web.turner.com, and tel. 404-878-0808 and report the problem.

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EX-10.4

Exhibit 10.4

Execution Version

FIRST AMENDMENT

TO

SEARCH SERVICES AGREEMENT

This First Amendment to the Search Services Agreement (“First Amendment”) is entered into by and between AOL LLC, (“AOL”) a Delaware limited liability company, with its principal place of business at 22000 AOL Way, Dulles, VA 20166, and CNN Interactive Group, Inc. (“CNN”), a Delaware corporation with offices at One CNN Center, Atlanta, GA 30303, effective as of April 30, 2008 (the “First Amendment Effective Date”).

INTRODUCTION

The Parties hereto wish to amend the Search Services Agreement entered into by and between the AOL and CNN on or about September 1, 2007 (the “Existing Agreement”) to, inter alia, remove the obligation of AOL to pay CNN the Minimum Revenue Guarantee (as defined in the Existing Agreement) and, instead, have AOL pay CNN a share of Net Revenue on a monthly basis. Together, the Existing Agreement and the First Amendment shall be referred to collectively as the “Agreement”. Capitalized terms not defined in this First Amendment shall have the meanings set forth in the Existing Agreement.

AGREEMENT

For good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereby amend the Existing Agreement as follows:

1. Section 3.4 (titled, “Quarterly Performance Reviews”) of the Existing Agreement is hereby deleted in its entirety and replaced with the following:

“3.4 Quarterly Performance Reviews. The Parties will meet at least quarterly to discuss financial performance of the Sponsored Links and/or Web Offers Links and ways to optimize performance.”

2. Section 5.1 (titled, “Minimum Revenue Guarantee”) and Section 5.2 (titled, “Performance Revenue”) of the Existing Agreement are hereby deleted in their entirety and replaced with the following:

“5.1. Revenue Share. Effective May 1, 2008, AOL shall pay CNN eighty-five percent (85%) of the Net Revenue recognized by AOL (the “Revenue Share”). As used herein, “Net Revenue” shall equal revenue recognized by AOL from the Third Party Provider or Advertisers, as applicable, for the Advertising Results delivered to CNN during the Term. AOL shall pay CNN the Revenue Share, as described in this Section 5.1, on a monthly basis within thirty (30) days following the end of each applicable calendar month in which such amounts were recognized. In addition, within thirty (30) days following the end of April 2008, AOL will pay to CNN an amount equal to: (a) eighty-five percent (85%) of the Net Revenue recognized by AOL during the calendar months of September 1, 2007 through April 30, 2008 less (b) the portion of the Minimum Revenue Guarantee (as defined in Section 5.2 of the Existing Agreement) paid to CNN during the period September 1, 2007 through April 30, 2008.”

“5.2. Intentionally Blank.”

3. The following phrase from the first sentence of Section 5.5(e) of the Existing Agreement is hereby deleted: “and upon AOL’s payment of the Threshold Revenue Share”.

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4. Section 6.1 (titled, “Term”) of the Existing Agreement is hereby deleted in its entirety and replaced with the following:

“This Agreement will commence on the Effective Date and shall expire at 11:59 p.m. (EST) on December 31, 2009, unless terminated earlier as provided for in this Agreement (the “Term”).

5. Section 6.2 (titled, “Make Good Term”) of the Existing Agreement is hereby deleted in its entirety.

6. Section 6.6 (titled, “Suspension of Services”) is hereby deleted and replaced with the following:

“Suspension of Services. In the event that the Web Service and/or the Sponsored Advertising Service is suspended by the Third Party Provider and not generally available to AOL, AOL shall have the right to suspend CNN’s use of such services, as applicable, until they are again made generally available to AOL. If the Web Service and/or the Sponsored Advertising Service is suspended by the Third Party Provider and not generally available to AOL beyond sixty (60) days, either Party may terminate this Agreement upon written notice to the other Party. In addition, if AOL suspends the Web Service and/or the Sponsored Advertising Service pursuant to this Section, AOL shall continue to pay to CNN a pro-rated amount of the average monthly Revenue Share paid to CNN during the preceding three (3) months for such time period, provided, however, that if either Party terminates this Agreement pursuant to this Section 6.6, AOL shall only be obligated to pay CNN a pro-rated amount of the Revenue Share paid to CNN during the preceding month through the effective date of such termination.”

7. Section 6.7 (titled, “Termination of IMA and/or Web Search Agreement”) of the Existing Agreement is hereby deleted in its entirety and replaced with the following:

“6.7. Termination of IMA and/or Web Search Agreement. In the event that during the Term either the IMA or the Web Search Agreement is terminated (by either AOL or the Third Party Provider), AOL may terminate this Agreement upon sixty (60) days prior written notice, provided that: (a) CNN shall be entitled to retain all amounts previously paid and amounts due and owing through the effective date of such termination; and (b) in the event AOL is unable to provide the Web Service and/or the Sponsored Advertising Service during such sixty (60) day period, AOL shall continue to pay to CNN a pro-rated amount of the Revenue Share paid to CNN during the preceding month through the effective date of such termination. If, however, AOL is able to offer a replacement search provider, which is acceptable to CNN (as determined in CNN’s sole discretion), within sixty (60) days after giving notice to terminate this Agreement pursuant to this Section 6.7, then (i) AOL shall continue pay CNN the Revenue Share for the Term of this Agreement, and (ii) CNN will use commercially reasonable efforts to transition into using the paid and organic search services of the agreed upon replacement search provider.”

8. Section 6.9 (titled, “Effect of Termination”) of the Existing Agreement is hereby deleted in its entirety and replaced with the following:

“6.9. Effect of Termination. In the event of a termination of the Agreement on any date prior to the expiration of the Term (“Early Termination”), but without limiting the Parties’ other respective rights and remedies under this Agreement or at law, AOL shall pay to CNN the Revenue Share generated during the Term (and not yet paid) within thirty (30) days following the end of the month in which the termination became effective.”

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9. The definition of “Make Good Term” set forth in Exhibit A of the Existing Agreement is hereby deleted in its entirety.

10. The definition of “Minimum Revenue Guarantee” set forth in Exhibit A of the Existing Agreement is hereby deleted in its entirety.

11. The definition of “Threshold Revenue Share” set forth in Exhibit A of the Existing Agreement is hereby deleted in its entirety.

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

13. Order of Precedence. In the event of conflict between the terms and conditions of the Existing Agreement and the terms and conditions of this First Amendment, the terms and conditions of this First Amendment will control.

14. Entire Agreement. The Existing Agreement, together with any exhibits, and schedules attached thereto and referenced therein, all as modified by this First Amendment, constitutes the entire and exclusive agreement between the Parties with respect to the subject matter thereof.

15. Counterparts; Facsimile. This First Amendment may be executed in counterparts, each of which shall be deemed an original and all of which together shall constitute one and the same document. This First Amendment may be executed by signatures transmitted by facsimile.

IN WITNESS WHEREOF, the Parties have caused this First Amendment to the Search Services Agreement to be signed by their duly authorized representatives and delivered as of the dates set forth below.

AOL LLC		CNN INTERACTIVE GROUP, INC.
By:	/s/ John Kannapell	By:	/s/ Susan Grant
Name:	John Kannapell	Name:	Susan Grant
Title:	SVP, AOL Search	Title:	EVP
Date:	5/11/08	Date:	5/7/08

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EX-10.5

Exhibit 10.5

Execution Copy

SECOND AMENDMENT TO SEARCH SERVICES AGREEMENT

This Second Amendment to Search Services Agreement (“Second Amendment”) is entered into by and between AOL Inc. (successor-in-interest to AOL LLC), a Delaware corporation, with its principal place of business at 770 Broadway, New York, NY 10003 (“AOL”), and CNN Interactive Group, Inc. (“CNN”), a Delaware corporation with offices at One CNN Center, Atlanta, GA 30303, effective as of December 10, 2009 (the “Second Amendment Effective Date”).

INTRODUCTION

The Parties hereto wish to amend the Search Services Agreement entered into by and between AOL and CNN on or about September 1, 2007, as amended by the First Amendment dated as of April 30, 2008 (collectively, the “Existing Agreement”), Together, the Existing Agreement and this Second Amendment shall be referred to collectively as the “Agreement”. Capitalized terms not defined in this Second Amendment shall have the meanings set forth in the Existing Agreement.

AGREEMENT

For good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereby amend the Existing Agreement as follows:

1. Term. Section 6.1 (titled, “Term”) of the Existing Agreement is hereby deleted in its entirety and replaced with the following:

“This Agreement will commence on the Effective Date and shall expire at 11:59 p.m. (EST) on January 31, 2010, unless terminated earlier as provided for in this Agreement (the “Term”).

2. Order of Precedence; Entire Agreement. Except as expressly modified by this Second Amendment, all terms and conditions, and provisions of the Existing Agreement shall continue in full force and effect. In the event of conflict between the terms and conditions of the Existing Agreement and the terms and conditions of this Second Amendment, the terms and conditions of this Second Amendment will control. The Existing Agreement, together with any exhibits, and schedules attached thereto and referenced therein, all as modified by this Second Amendment, constitutes the entire and exclusive agreement between the Parties with respect to the subject matter thereof.

3. Counterparts; Facsimile. This Second Amendment may be executed in counterparts, each of which shall be deemed an original and all of which together shall constitute one and the same document. This Second Amendment may be executed by signatures transmitted by facsimile or email.

IN WITNESS WHEREOF, the Parties have caused this Second Amendment to Search Services Agreement to be signed by their duly authorized representatives and delivered as of the dates set forth below.

AOL INC.		CNN INTERACTIVE GROUP, INC.
By:	/s/ Steven Quan	By:	/s/ KC Estenson
Name:	Steven Quan	Name:	KC Estenson
Title:	VP, Business Development	Title:	SVP, GM, CNN.com
Date:	12/10/09	Date:	12/18/09

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EX-10.6

Exhibit 10.6

Execution Copy

SIXTH AMENDMENT TO SEARCH SERVICES AGREEMENT

This Sixth Amendment to Search Services Agreement (“Sixth Amendment”) is entered into by and between AOL Inc. (successor-in-interest to AOL LLC), a Delaware corporation, with its principal place of business at 770 Broadway, New York, NY 10003 (“AOL”), and CNN Interactive Group, Inc. (“CNN”), a Delaware corporation with offices at One CNN Center, Atlanta, GA 30303, effective as of April 30, 2010 (the “Sixth Amendment Effective Date”).

INTRODUCTION

The Parties hereto wish to amend the Search Services Agreement entered into by and between AOL and CNN on or about September 1, 2007, as amended by the First Amendment dated as of April 30, 2008, the Second Amendment dated as of December 10, 2009, the Third Amendment dated as of January 31, 2010, the Fourth Amendment dated as of February 28, 2010, and the Fifth Amendment dated as of March 31, 2010 (collectively, the “Existing Agreement”). Together, the Existing Agreement and this Sixth Amendment shall be referred to collectively as the “Agreement”. Capitalized terms not defined in this Sixth Amendment shall have the meanings set forth in the Existing Agreement.

AGREEMENT

For good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereby amend the Existing Agreement as follows:

1. Term. Section 6.1 (titled, “Term”) of the Existing Agreement is hereby deleted in its entirety and replaced with the following:

“This Agreement will commence on the Effective Date and shall expire at 11:59 p.m. (EST) on May 31, 2010, unless terminated earlier as provided for in this Agreement (the “Term”). CNN may terminate this Agreement upon no less than three (3) days prior written notice to AOL if Google is prepared to provide search services directly to CNN.

2. Exclusivity Obligations. Effective as of April 30, 2010, Section 4.1 of the Agreement (including subsections therein) shall be deleted in its entirety and replaced with the following:

“Notwithstanding anything else set forth in the Agreement, no exclusivity obligation shall apply to CNN.com with respect to its Use of Search-Based Sponsored Text Links and Text-Based Algorithmic Internet Search, and CNN.com may Use Search-Based Sponsored Text Links and Text-Based Algorithmic Internet Search provided by a third party.”

3. Order of Precedence; Entire Agreement. Except as expressly modified by this Sixth Amendment, all terms and conditions, and provisions of the Existing Agreement shall continue in full force and effect. In the event of conflict between the terms and conditions of the Existing Agreement and the terms and conditions of this Sixth Amendment, the terms and conditions of this Sixth Amendment will control. The Existing Agreement, together with any exhibits, and schedules attached thereto and referenced therein, all as modified by this Sixth Amendment, constitutes the entire and exclusive agreement between the Parties with respect to the subject matter thereof.

4. Counterparts; Facsimile. This Sixth Amendment may be executed in counterparts, each of which shall be deemed an original and all of which together shall constitute one and the same document. This Sixth Amendment may be executed by signatures transmitted by facsimile or email.

Confidential

Execution Copy

IN WITNESS WHEREOF, the Parties have caused this Sixth Amendment to Search Services Agreement to be signed by their duly authorized representatives and delivered as of the dates set forth below.

AOL INC.		CNN INTERACTIVE GROUP, INC.
By:	/s/ Steven Quan	By:	/s/ KC Estenson
Name:	Steven Quan	Name:	KC Estenson
Title:	VP, Business Development	Title:	SVP, GM, CNN.com
Date:	4/29/10	Date:	4/30/10

Confidential   2

EX-10.7

Exhibit 10.7

Execution Copy

SEVENTH AMENDMENT TO SEARCH SERVICES AGREEMENT

This Seventh Amendment to Search Services Agreement (“Seventh Amendment”) is entered into by and between AOL Inc. (successor-in-interest to AOL LLC), a Delaware corporation, with its principal place of business at 770 Broadway, New York, NY 10003 (“AOL”), and CNN Interactive Group, Inc. (“CNN”), a Delaware corporation with offices at One CNN Center, Atlanta, GA 30303, effective as of May 31, 2010 (the “Seventh Amendment Effective Date”).

INTRODUCTION

The Parties hereto wish to amend the Search Services Agreement entered into by and between AOL and CNN on or about September 1, 2007, as amended by the First Amendment dated as of April 30, 2008, the Second Amendment dated as of December 10, 2009, the Third Amendment dated as of January 31, 2010, the Fourth Amendment dated as of February 28, 2010, the Fifth Amendment dated as of March 31, 2010, and the Sixth Amendment, dated as of April 30, 2010 (collectively, the “Existing Agreement”). Together, the Existing Agreement and this Seventh Amendment shall be referred to collectively as the “Agreement”. Capitalized terms not defined in this Seventh Amendment shall have the meanings set forth in the Existing Agreement.

AGREEMENT

For good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereby amend the Existing Agreement as follows:

1. Term. Section 6.1 (titled, “Term”) of the Existing Agreement is hereby deleted in its entirety and replaced with the following:

“This Agreement will commence on the Effective Date and shall expire at 11:59 p.m. (EST) on June 30, 2010, unless terminated earlier as provided for in this Agreement (the “Term”). CNN may terminate this Agreement upon no less than three (3) days prior written notice to AOL if Google is prepared to provide search services directly to CNN.

2. Order of Precedence; Entire Agreement. Except as expressly modified by this Seventh Amendment, all terms and conditions, and provisions of the Existing Agreement shall continue in full force and effect. In the event of conflict between the terms and conditions of the Existing Agreement and the terms and conditions of this Seventh Amendment, the terms and conditions of this Seventh Amendment will control. The Existing Agreement, together with any exhibits, and schedules attached thereto and referenced therein, all as modified by this Seventh Amendment, constitutes the entire and exclusive agreement between the Parties with respect to the subject matter thereof.

3. Counterparts; Facsimile. This Seventh Amendment may be executed in counterparts, each of which shall be deemed an original and all of which together shall constitute one and the same document. This Seventh Amendment may be executed by signatures transmitted by facsimile or email.

IN WITNESS WHEREOF, the Parties have caused this Seventh Amendment to Search Services Agreement to be signed by their duly authorized representatives and delivered as of the dates set forth below.

AOL INC.		CNN INTERACTIVE GROUP, INC.
By:	/s/ Steven Quan	By:	/s/ KC Estenson
Name:	Steven Quan	Name:	KC Estenson
Title:	VP, Business Development	Title:	SVP & GM, CNN.com
Date:	5/25/10	Date:	5/25/2010

Confidential

EX-10.8

Exhibit 10.8

Execution Copy

SIXTH AMENDMENT TO SEARCH SERVICES AGREEMENT

This Sixth Amendment to Search Services Agreement (“Sixth Amendment”) is entered into by and between AOL Inc. (successor-in-interest to AOL LLC), a Delaware corporation, with its principal place of business at 770 Broadway, New York, NY 10003 (“AOL”), and Time Inc. (“TI”), a Delaware corporation with offices at 1271 Avenue of the Americas, New York, New York 10020, effective as of April 30, 2010 (the “Sixth Amendment Effective Date”).

INTRODUCTION

The Parties hereto wish to amend the Search Services Agreement entered into by and between the AOL and TI on August 23, 2007, as amended by the First Amendment dated as of March 10, 2009, Second Amendment dated as of December 17, 2009, the Third Amendment dated as of January 31, 2010, the Fourth Amendment dated as of February 28, 2010, and the Fifth Amendment dated as of March 31, 2010 (collectively, the “Existing Agreement”). Together, the Existing Agreement and this Sixth Amendment shall be referred to collectively as the “Agreement”. Capitalized terms not defined in this Sixth Amendment shall have the meanings set forth in the Existing Agreement.

AGREEMENT

For good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereby amend the Existing Agreement as follows:

1. Term. Section 6.1 (titled, “Term”) of the Existing Agreement is hereby deleted in its entirety and replaced with the following:

“This Agreement will commence on the Effective Date and shall expire at 11:59 p.m. (EST) on May 31, 2010, unless terminated earlier as provided for in this Agreement (the “Term”). TI may terminate this Agreement by providing written notice to AOL at least three (3) business days in advance of the desired effective early termination date, which written notice may be in the form of email to the following AOL employees: (i) Steve Quan, VP Business Development at Steven.Quan@corp.aol.com, and (ii) Francis Lobo, VP AOL Search at Francis.Lobo@corp.aol.com.”

2. TI Revenue Share. In the event that the Term of the Agreement is extended beyond May 31, 2010, the Parties agree that the TI Revenue Share will be decreased to eighty-five percent (85%) of Net Revenue.

3. Order of Precedence; Entire Agreement. Except as expressly modified by this Sixth Amendment, all terms and conditions, and provisions of the Existing Agreement shall continue in full force and effect. In the event of conflict between the terms and conditions of the Existing Agreement and the terms and conditions of this Sixth Amendment, the terms and conditions of this Sixth Amendment will control. The Existing Agreement, together with any exhibits, and schedules attached thereto and referenced therein, all as modified by this Sixth Amendment, constitutes the entire and exclusive agreement between the Parties with respect to the subject matter thereof.

4. Counterparts; Facsimile. This Sixth Amendment may be executed in counterparts, each of which shall be deemed an original and all of which together shall constitute one and the same document. This Sixth Amendment may be executed by signatures transmitted by facsimile.

IN WITNESS WHEREOF, the Parties have caused this Sixth Amendment to Search Services Agreement to be signed by their duly authorized representatives and delivered as of the dates set forth below.

AOL INC.		TIME INC.
By:	/s/ Steven Quan	By:	/s/ Kavata Mbondo
Name:	Steven Quan	Name:	Kavata Mbondo
Title:	VP, Business Development	Title:	Dir., Inventory Analytics & Bus. Dev.
Date:	4/28/10	Date:	4/24/2010

Confidential

EX-10.9

Exhibit 10.9

Execution Copy

SEVENTH AMENDMENT TO SEARCH SERVICES AGREEMENT

This Seventh Amendment to Search Services Agreement (“Seventh Amendment”) is entered into by and between AOL Inc. (successor-in-interest to AOL LLC), a Delaware corporation, with its principal place of business at 770 Broadway, New York, NY 10003 (“AOL”), and Time Inc. (“TI”), a Delaware corporation with offices at 1271 Avenue of the Americas, New York, New York 10020, effective as of May 31, 2010 (the “Seventh Amendment Effective Date”).

INTRODUCTION

The Parties hereto wish to amend the Search Services Agreement entered into by and between the AOL and TI on August 23, 2007, as amended by the First Amendment dated as of March 10, 2009, Second Amendment dated as of December 17, 2009, the Third Amendment dated as of January 31, 2010, the Fourth Amendment dated as of February 28, 2010, the Fifth Amendment dated as of March 31, 2010, and the Sixth Amendment dated as of April 30, 2010 (collectively, the “Existing Agreement”). Together, the Existing Agreement and this Seventh Amendment shall be referred to collectively as the “Agreement”. Capitalized terms not defined in this Seventh Amendment shall have the meanings set forth in the Existing Agreement.

AGREEMENT

For good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereby amend the Existing Agreement as follows:

1. Term. Section 6.1 (titled, “Term”) of the Existing Agreement is hereby deleted in its entirety and replaced with the following:

“This Agreement will commence on the Effective Date and shall expire at 11:59 p.m. (EST) on June 30, 2010, unless terminated earlier as provided for in this Agreement (the “Term”). TI may terminate this Agreement by providing written notice to AOL at least three (3) business days in advance of the desired effective early termination date, which written notice may be in the form of email to the following AOL employees: (i) Steve Quan, VP Business Development at Steven.Quan@corp.aol.com, and (ii) Francis Lobo, VP AOL Search at Francis.Lobo@corp.aol.com.”

2. TI Revenue Share. Pursuant to Section 2 of the Sixth Amendment, effective as of June 1, 2010, the TI Revenue Share (as defined in Section 5.2 of the Agreement) will be decreased to eighty-five percent (85%) of Net Revenue (as defined in Section 5.2 of the Agreement).

3. Order of Precedence; Entire Agreement. Except as expressly modified by this Seventh Amendment, all terms and conditions, and provisions of the Existing Agreement shall continue in full force and effect. In the event of conflict between the terms and conditions of the Existing Agreement and the terms and conditions of this Seventh Amendment, the terms and conditions of this Seventh Amendment will control. The Existing Agreement, together with any exhibits, and schedules attached thereto and referenced therein, all as modified by this Seventh Amendment, constitutes the entire and exclusive agreement between the Parties with respect to the subject matter thereof.

4. Counterparts; Facsimile. This Seventh Amendment may be executed in counterparts, each of which shall be deemed an original and all of which together shall constitute one and the same document. This Seventh Amendment may be executed by signatures transmitted by facsimile.

Confidential

Execution Copy

IN WITNESS WHEREOF, the Parties have caused this Seventh Amendment to Search Services Agreement to be signed by their duly authorized representatives and delivered as of the dates set forth below.

AOL INC.		TIME INC.
By:	/s/ Steven Quan	By:	/s/ Kavata Mbondo
Name:	Steven Quan	Name:	Kavata Mbondo
Title:	VP, Business Development	Title:	Dir., Inventory Analytics & Bus. Dev.
Date:	5/26/10	Date:	5/26/2010

Confidential

EX-10.12

Exhibit 10.12

Via Hand Delivery

Revised April 5, 2010

January 14, 2010

Ted Cahall

22000 AOL Way

Dulles, Virginia 20166

Separation Agreement and Release of Claims

Dear Ted:

This letter will serve as confirmation that your employment with AOL Inc. (together with any successors, subsidiaries, merged entities, parent entities and their respective affiliates, “AOL” or “the Company”) is being terminated without cause. This Separation Agreement and Release of Claims (“Separation Agreement”), upon your signature after your Separation Date, will constitute the complete agreement between you and the Company regarding the terms of your separation from employment.

1. Your employment with the Company will terminate without cause at the close of business May 1, 2010 (your “Separation Date”) and January 14, 2010, the original date of this letter, shall be deemed your notification date (your “Notification Date”). Beginning on your Notification Date, you will remain an employee of the Company through your Separation Date (“Notification Period”). You shall continue to receive your base salary and benefits during this Notification Period. It is expected that you will perform your job satisfactorily. The Company reserves the right to change your Separation Date, but will notify you in writing of any change. If you obtain other employment with AOL or with any Time Warner company within thirty days of your Separation Date, you will not be eligible to receive any of the benefits set forth in this Agreement, unless specified herein, and this Agreement shall become null and void.

2. On the next regularly scheduled pay date following your Separation Date, or sooner if local law requires, you will receive a check for all unpaid wages and any accrued, unused vacation or paid time off from January 1, 2010, or longer if required by state law, due through your Separation Date, less applicable deductions and withholdings.

3. Your medical, dental and vision benefits will continue through the end of the month in which your Separation Date occurs. With respect to the Consolidated Omnibus Budget Reconciliation Act (“COBRA”), your COBRA period will begin on the first day of the month following your Separation Date. You will receive separate information regarding your option to continue health benefits under COBRA after your Separation.

Date. Your Company-paid life insurance will continue through the end of the month in which your Separation Date occurs. All other benefits will terminate on your Separation Date.

4. Prior to your departure on your Separation Date, unless otherwise instructed by an authorized Company representative, you must:

a. resign from any and all positions you hold as an officer and/or director of AOL Inc. and from each of its direct and indirect subsidiaries and/or affiliates; and

b. return to your department manager all the Company property in your possession, including, but not limited to, your identification badge and SecurID, keys, computers, corporate credit cards, pagers, telephones, parking permits and the original and all copies of any written, recorded, or computer readable information about Company practices, procedures, trade secrets, customer lists or product marketing associated with the Company’s business and any other information deemed proprietary or confidential in accordance with Company policies or the Company’s Confidential Information, Non-Competition and Proprietary Rights Agreement (the “CNPR Agreement”). By signing this Separation Agreement, you represent that you have returned all Company confidential or proprietary information in your possession and that you took all reasonable steps to protect the confidentiality of such Company information during your employment. You agree that you are bound by (a) all the terms of the Standards of Business Conduct through your Separation Date and (b) the Company’s CNPR Agreement, which remains in full force and effect after your Separation Date as specified therein.

5. In addition, pursuant to your December 15, 2006 Agreement and under the terms and conditions as detailed below, the Company will agree to provide you additional payments and benefits, which you acknowledge are payments and benefits to which you are otherwise not entitled, if you sign this Separation Agreement. If you do not sign this Separation Agreement, you will not receive the additional payments and benefits.

6. In exchange for your execution of this Separation Agreement, the Company will provide you the following and the following terms shall apply:

a. An amount equal to eighteen (18) months of your current Base Salary ($885,000), less applicable withholdings, payable in a lump sum, subject to paragraph 6(g) below. This payment will not be eligible for deferrals to the Company’s 401(k) plan.

b. Any unpaid bonus pursuant to the Company Retention Bonus Program, as outlined to you in a memo dated April 1, 2009 (an amount equal to $190,000), if you have not received such payment on or before your Separation Date, less tax withholdings, payable in a lump sum subject to paragraph 6(g) below. This payment will not be eligible for deferrals to the Company’s 401(k) plan.

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c. Subject to the terms of the Termination paragraph of the May 13, 2008 amendment to your Agreement (“Employment Agreement Amendment”), you will receive a bonus payment for the period from July 1, 2009 through 12/31/2009, if you have not received such payment on or before your Separation Date, payable at the target rate set forth in AOL’s Global Bonus Plan, (an amount equal to $181,720), less tax withholdings, paid in a lump sum, subject to paragraph 6(g) below. This amount represents the Bonus payment for the “Prior Year” as referenced in the termination provision of your Employment Agreement Amendment. This payment will not be eligible for deferrals to the Company’s 401(k) plan.

d. Subject to the terms of the Termination paragraph of your Employment Agreement Amendment, you will receive an amount equal to a pro-rated bonus payment for the period from January 1, 2010 through your Separation Date, payable at target (an amount equal to $184,389), less tax withholdings, paid in a lump sum, subject to paragraph 6(g) below. This payment will not be eligible for deferrals to the Company’s 401(k) plan.

e. If you elect to enroll in COBRA benefit continuation, the Company will pay the cost of medical, dental and vision benefit coverage under COBRA for eighteen (18) months beginning the first day of the calendar month following the termination of your employment.

f. The services of a professional outplacement and counseling firm, as designated by the Company, for eighteen (18) months to assist you in securing employment following your separation from employment with the Company.

g. The payments made under paragraphs 6(a), 6(b), 6(c) and 6(d) will be paid within thirty (30) days of the Separation Date or the “effective date” of the signed Separation Agreement, as set forth in paragraph 15 below, whichever is later, but no later than March 15 of the calendar year following the year of the termination of your employment. The Company represents that you were not a “specified employee” as of your separation from service, for purposes of 409A application. You are relying upon this representation by the Company in accepting the consideration in this Separation Agreement. In the event there is a determination to the contrary, in spite of the Company’s belief and representation that you were not a “specified employee” as of your separation from service, within the meaning of 409A, then the Company shall take all steps to make you whole, including any gross ups, payments of taxes, penalties and interest, and shall further compensate you for any losses as a result of such contrary determination, including any legal, tax and financial fees incurred by you associated with any challenge, determination and/or compliance. If any provision of this Agreement would cause you to incur any additional tax or interest under Section 409A of the Internal Revenue

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Code of 1986, as amended (“the Code”), any regulations or Treasury guidance promulgated thereunder, the Company shall reform such provision, provided that the Company shall: (i) maintain, to the maximum extent practicable, the original intent of the applicable provision without violating the provisions of Section 409A of the Code; and (ii) notify and consult with you regarding such amendments or modifications prior to the effective date of any such change.

In addition to the payments under this paragraph 6, if it shall be determined that any event or any payment, vesting, distribution, or transfer by the Company (or any successor, affiliate or by any other person) to you or for your benefit under the terms of this Agreement or otherwise would be subject to or result in the imposition of the excise tax under Section 4999 of the Code (and any regulations issued thereunder, any successor provision, and any similar provision of state or local income tax law) (collectively, the “Excise Tax”), then the Company shall pay to you a lump sum (“Tax Equalization Payment”) in an amount sufficient that, after payment of the federal, state or local income, employment or other required taxes (other than taxes that may be imposed by Section 409A of the Code)(“Regular Taxes”), you shall receive an amount equal to the Excise Tax. Such payment shall be made within 15 days of the date which you remit such Excise Tax. In determining the amount of any Regular Taxes, the maximum applicable, marginal rate of tax for the year in which the Tax Equalization Payment is payable shall be used. The amount of this Tax Equalization Payment shall be determined by the Company’s independent accountants.

h. You shall not be entitled to notice and severance under any policy or plan of the Company (the payments set forth in this paragraph being given in lieu thereof).

i. Except as set forth in paragraphs 6(b)-6(d), you shall not be entitled to receive any other bonus or pro-rated bonus payment.

j. The payments under paragraphs 6(a)-6(d) shall be made without regard to any duty to mitigate damages and shall not be reduced by any compensation received by you from any subsequent employment.

7. The payments and other benefits set forth in paragraph 6 are being offered solely in consideration for your execution of this Separation Agreement, including a release of all claims against the Company as set forth in paragraph 8 below. The payments are not an admission of any wrongdoing by the Company.

8. In exchange for the Company’s agreement as stated above, you agree to release and discharge unconditionally the Company and any successors, subsidiaries, affiliates, related entities, predecessors, merged entities and parent entities, and their respective

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officers, directors, stockholders, employees, benefit plan administrators and trustees, agents, attorneys, insurers, representatives, affiliates, successors and assigns, from any and all claims, actions, causes of action, demands, obligations or damages of any kind arising from your employment with the Company and the separation of that employment or otherwise, including the notice of your termination, whether known or unknown to you, which you ever had or now have upon or by reason of any matter, cause or thing, up to and including the day on which you sign this Separation Agreement. The claims you are waiving include, but are not limited to, all claims arising out of or related to any stock options held by you or granted to you by the Company which are scheduled to vest subsequent to your Separation Date; all claims under Title VII of the Civil Rights Act of 1964, as amended; all claims under the Worker Adjustment and Retraining Notification Act (WARN) or similar state statutes; all claims under the Americans with Disabilities Act; all claims under the Age Discrimination in Employment Act; all claims under the National Labor Relations Act; all claims under the Older Workers Benefit Protection Act (“OWBPA”); all claims under the Family and Medical Leave Act, to the extent permitted by law, all claims under the Employee Retirement Income Security Act; all claims under 42 U.S.C. § 1981; all claims under the Sarbanes-Oxley Act of 2002; all claims under state antidiscrimination laws; except in California, all claims for unreimbursed business expenses; all claims under any principle of common law; all claims concerning any right to reinstatement; and all claims for any type of relief from the Company, whether federal, state or local, whether statutory, regulatory or common law, and whether tort, contract or otherwise, to the fullest extent permitted by law. This release of claims does not affect any claim for workers’ compensation benefits, unemployment benefits or other non-waivable administrative claims, your vested rights, if any, in the Company’s 401(k) plan, your rights to exercise any and all Company stock options held by you that are exercisable as of your Separation Date during the applicable period of exercise and in accordance with all other terms of those options and the stock options plans, agreements, and notices under which such options were granted, or your right to enforce the terms of this Separation Agreement.

Notwithstanding the foregoing, in the event any of the Company’s successors, subsidiaries, affiliates, related entities, predecessors, merged entities and parent entities, and their respective officers, directors, stockholders, employees, benefit plan administrators and trustees, agents, attorneys, insurers, representatives, affiliates, successors and assigns bring any claim against you related to your dealings with the Company, you shall have the right to fully defend against such claims and may bring any counterclaims against such individuals or entities, without regard to this release.

9. In exchange for your agreement and covenants contained in this Agreement, the Company agrees to release and discharge you unconditionally, from any and all claims, action, causes of action, demands, obligations or damages of any kind arising out of or relating to your employment with the Company, the separation of that employment, whether known or unknown to them, which they ever had or now have upon or by reason of any matter, cause or thing, up to and including the day on which the Company signs this Separation Agreement. The claims they are waiving include, but are not limited to, all claims under any principle of common law; regulatory or common law, and whether tort, contract or otherwise, to the fullest extent permitted by law. This release of claims does not affect the Company’s right to enforce the terms of this Separation Agreement.

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10. The Company will provide you, within fifteen (15) days of your signature on this Separation Agreement, a full copy of your personnel file. Within seven (7) days of receipt of the file, you will mark any documents that you would like removed from the personnel file. Those documents marked and any copies of those documents will be removed from the personnel file and personnel records, and shall be held under seal by the Legal Department of the Company. The documents held under seal shall not be released absent Court Order, subpoena or other compulsory process. A release signed by you shall not be sufficient to release the documents; however, a letter requesting the release of the documents from your personal counsel shall be sufficient. Notwithstanding anything in this paragraph, the Company shall not be limited in its right to maintain accurate information in its personnel records in order to appropriately respond to any governmental agency or in any governmental or legal proceeding or to provide its benefit vendors with accurate information. In the event the Company believes that any of the information that you have requested be removed and kept under seal is provided to any governmental agency or in any governmental or legal proceeding or provided to its benefit vendors, the Company shall notify you in writing within 10 days of such event and the reasons therefore.

11. You agree to reasonably assist the Company, in connection with any litigation, investigation or other matter involving your tenure as an employee, officer, or director of the Company, including, but not limited to, meetings with Company representatives and counsel and giving testimony in any legal proceeding involving the Company. The Company will pay you reasonable compensation (to be mutually agreed upon at the time of request for your services) for the time you spend on such matters and reimburse you for all reasonable out-of-pocket expenses incurred in rendering such assistance to the Company.

12. The parties understand and agree that the terms of this Separation Agreement are confidential, and you agree not to disclose to others the terms of this Separation Agreement, except as otherwise permitted by law or with the written consent of each other, provided however, that this paragraph 13 does not preclude disclosure to your immediate family or for purposes of securing professional financial, tax or legal services, and for the Company, on a strictly need to know basis, provided further that, prior to making any such disclosure, the parties will inform any such persons that this confidentiality clause is in effect and that they are also bound by it.

13. The parties agree not to affirmatively encourage or assist any person or entity in litigation against each other in any manner. This provision does not prohibit each party’s response to a valid subpoena for documents or testimony or other lawful process; however, such receiving party agrees to provide the Company with prompt notice of any such subpoena or process. The parties further agree that this Separation Agreement is not admissible in any proceeding except one to enforce the terms of this Separation Agreement.

14. You agree not to make any disparaging or untruthful remarks or statements about the Company, its officers, directors, employees or agents. The Company agrees not to cause its officers or senior executives to make any disparaging or untruthful

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remarks or statements about your employment with the Company, in their official or unofficial capacity. Nothing in this Agreement prevents you or the Company from making truthful statements when required by law, court order, subpoena, or the like, to a governmental agency or body.

15. In accordance with the terms of this Agreement, you agree that in the event you are found in a court of law to be in breach of any of your obligations under this Separation Agreement, the Company may be entitled to receive the full amount paid under paragraph 6 above unless otherwise determined by the court and the Company will be entitled to obtain all other remedies provided by law or equity. In the event the Company is found in a court of law to be in breach of its obligations under this Separation Agreement, you will be entitled to appropriate relief as determined by the court.

16. If any term or clause of this Separation Agreement should ever be determined to be unenforceable, you and the Company agree that this will not affect the enforceability of any other term or clause of this Separation Agreement.

17. If you are under age 40 on your Separation Date:

a. You should consider consulting an attorney before executing this Separation Agreement. You have seven (7) days from your Separation Date in which to sign and return the Separation Agreement, although you may, at your discretion, sign and return the Separation Agreement at any earlier time, after your Separation Date. The day you return the executed Separation Agreement is the “effective date” of this Separation Agreement. If you have not returned the executed Separation Agreement within the time permitted, then the Company’s offer will expire by its own terms at such time.

b. If you are age 40 or older on your Separation Date:

Pursuant to the Older Workers Benefit Protection Act of 1990 (“OWBPA”), you acknowledge and warrant the following: (i) that you are waiving rights and claims for age discrimination under the ADEA and OWBPA, in exchange for the consideration described above, which is not otherwise due to you; (ii) you have consulted with an attorney before signing this Release and Waiver; (iii) you are not waiving rights or claims for age discrimination that may arise after the effective date of this Release and Waiver; (iv) you have been given a period of at least forty-five (45) days in which to consider this Release and Waiver and the waiver of any claims you have or may have under law, including your rights under the ADEA and OWBPA, before signing below; and (v) you understand that you may revoke the waiver of your age discrimination claims under the ADEA and OWBPA within seven (7) days after your execution of this Release and Waiver, and that such waiver shall not become effective or enforceable until seven (7) days after the date on which you execute this Release and Waiver.

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To revoke, you must send a written statement of revocation delivered by certified mail to AOL Inc., Attn: Gillian Pon, 22110 Pacific Blvd, Dulles, VA 20166. The revocation must be received no later than 5:00 p.m. on the seventh day following your execution of this Separation Agreement. If you do not so revoke, the eighth day following your acceptance will be the “effective date” of this Separation Agreement. If you have not returned the executed Separation Agreement within the time permitted, then the Company’s offer will expire by its own terms at such time.

18. This Agreement shall be governed by and construed and enforced in accordance with the substantive laws of the Commonwealth of Virginia applicable to agreements made and to be performed entirely in Virginia.

To accept the Separation Agreement, you must sign below on or after your Separation Date and return one entire copy to AOL Inc., Attn: Gillian Pon, 22110 Pacific Blvd., Dulles, VA 20166. (An extra copy for your files is enclosed.)

Sincerely,

/s/ David Harmon

David Harmon

Executive Vice President, Human Resources

AOL Inc.

By signing this Separation Agreement, I acknowledge that: I have had the opportunity to review this Separation Agreement carefully with legal or other personal advisors of my own choice; I understand that by signing this Separation Agreement I am releasing the Company of all claims against it; I have read this Separation Agreement and understand its terms; I have been given a reasonable period of time to consider its terms and effect and to ask any questions I may have; I voluntarily agree to the terms of this Separation Agreement.

AGREED AND ACCEPTED:
/s/ Theodore R. Cahall, Jr.	4/8/10
Ted Cahall	Date

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EX-10.13

Exhibit 10.13

[AOL LOGO]

AOL Inc. - Annual Bonus Plan

HIGHLY CONFIDENTIAL: AOL INTERNAL USE ONLY   [AOL LOGO]

1. Objective

The success of AOL Inc., along with its subsidiaries and affiliates (together the “Company”), is to a great extent dependent on the caliber of its employees. The AOL Inc. Annual Bonus Plan (the “ABP”) is a critical tool in rewarding outstanding Company performance, individual performance and behaviors that contribute to the achievement of corporate objectives.

At the discretion of senior management, the ABP provides participating employees (other than the executive officers of the Company whose participation is governed by the AOL Inc. Annual Incentive Plan for Executive Officers (the “Executive AIP”) and Section 6 herein) with the opportunity to receive cash incentives based on the financial and operational performance of the Company as well as their own individual performance.

The guidelines provided in this document are applicable to all ABP eligible employees regardless of location. As appropriate, due to local country laws or regulations, certain processes or calculations may be modified. For guidance on the application of the ABP within your particular country, please contact your HR representative.

The ABP shall supersede the Global Bonus Plan (GBP) in its entirety.

2. Eligibility

Employees of the Company with job grades A through J are eligible to participate in the ABP, subject to the terms of the ABP and the following conditions (each such employee, a “Participant”).

a. U.S. based employees must be scheduled to work a minimum of 25 hours or more per week to be eligible to participate.

b. Employees eligible to participate in any other Company incentive plan, including but not limited to sales incentive plans and bonus plans (e.g., the Patch Bonus Plan, etc.) are not eligible to participate in the ABP.

c. New employees who are hired during the 4^th quarter of a plan year (October 1^st – December 31^st or “Q4”) become eligible to participate in the ABP beginning on January 1^st of the following plan year. These employees will not be eligible to participate in the ABP or receive a prorated ABP payout for the plan year in which they were hired or transferred.

d. UK employees – a new employee who is hired during the year will be eligible to participate in the ABP beginning on his or her first day of employment or when he or she transfers into an eligible position. In addition, employees on a fixed term contracts are eligible to participate provided they are actively employed on the payment date.

SECTION: AOL INC. ANNUAL BONUS PLAN 2

HIGHLY CONFIDENTIAL: AOL INTERNAL USE ONLY [AOL LOGO]

e. Certain individuals, including, but not limited to, interns, MBA interns, contractors, bloggers and temporary workers who are not considered employees of the Company are not eligible to participate in the ABP. This list is not intended to be all inclusive and may be updated without prior notice.

f. The eligibility of executive officers of the Company will be determined pursuant to Section 5 of the Executive AIP.

3. Target Incentive

The ABP target incentive for Participants in job grades A through J is reflected as a percentage of such Participant’s annual base pay. If a Participant in grades A through J is an executive officer of the Company, then the applicable ABP target incentive for such Participant will be a component in the criteria used by the Committee (as defined in the Executive AIP) to apply negative discretion in determining the actual annual incentive payable to such Participant pursuant to the terms of the Executive AIP. No annual incentive payment will be made to an executive officer of the Company unless and until the performance goal specified in Section 3.2 of the Executive AIP is achieved.

Actual annual incentive payouts, if granted, will be calculated based on a Participant’s actual base pay for the plan year in accordance with the administrative guidelines of the ABP.

4. Performance Measures & Weighting

ABP target incentive payouts are calculated based on the following factors:

a. For Participants who are the Chief Executive Officer or an Executive Vice-President (“EVP”), the Company’s financial and operational performance is weighted at 75%.

b. For SVPs and below, the Company’s financial and operational performance is weighted at 50%.

c. Participants who are the Chief Executive Officer an EVP, individual performance as measured against pre-approved performance measures, is weighted at 25%.

SECTION: AOL INC. ANNUAL BONUS PLAN 3

HIGHLY CONFIDENTIAL: AOL INTERNAL USE ONLY [AOL LOGO]

d. For SVPs and below, individual performance as measured by a Participant’s overall rating in his or her annual performance review is weighted at 50%. Participants are rated on a 5-point scale against pre-determined individualized goals. The performance rating is then ranked with all other ratings within the EVP’s organization. Participants whose ratings are in the top 30th percentile of all eligible employees will be eligible to receive an additional discretionary annual incentive payment (or, in the case of a Participant who is an executive officer of the Company, this will be an additional factor considered in the application of negative discretion in determining the actual amount of the annual incentive that such Participant will receive under the Executive AIP (see below)). Participants in the bottom 10th percentile of eligible employees will not be eligible for a bonus.

e. With respect to a Participant who is an executive officer of the Company, the foregoing performance measures may be used by the Committee apply negative discretion to determine the actual bonus payable to such Participant (as set forth in Section 3.4 of the Executive AIP); provided, however, that the Company has positive “Adjusted Net Income,” as defined in the Executive AIP.

5. Funding

The Company’s total ABP funding is based on the Company’s operating income before depreciation and amortization (“OIBDA”) and Free Cash Flow achievement level, excluding restructuring costs. The OIBDA and Free Cash Flow goals are determined at the beginning of each plan year by senior management.

The ABP funding levels at various levels of the Company’s achievement are determined on an annual basis at the beginning of each plan year.

Both the OIBDA and Free Cash Flow metrics must meet the minimum threshold associated with a targeted funding level in order to have any payment at that targeted funding level. There is no guarantee of payout if the threshold is not met.

An employee who is rated below 100% in his or her individual performance metric will be funded at the lower of his or her performance rating or the Company’s performance rating. For example, if the Company achieves a 110% rating and the employee receives a 70% rating, the employee’s bonus will be funded at 70% for both the individual rating as well as the Company rating.

Final ABP funding is at the discretion of the Chief Executive Officer of the Company.

6. Executive Officers

This Section 6 will apply only to those Participants who are also executive officers, which determination will be made by the Committee. Only with respect to annual incentives payable to such Participants should the ABP be considered a sub-plan of the

SECTION: AOL INC. ANNUAL BONUS PLAN 4

HIGHLY CONFIDENTIAL: AOL INTERNAL USE ONLY [AOL LOGO]

Executive AIP. The eligibility of such Participants will be determined pursuant to Section 5 of the Executive AIP and the performance goals for such Participants will be determined pursuant to Section 3 of the Executive AIP. In addition, this sub-plan for Participants who are executive officers will be administered in accordance with Section 4 of the Executive AIP. The method, timing and/or form of any annual incentive payouts to such Participants will be as set forth in the Executive AIP. Once the Committee determines in writing that performance goals have been achieved (pursuant to Section 3 of the Executive AIP), the Committee may use negative discretion to finalize the annual incentive payouts, pursuant to the guidelines established under the ABP. The guidelines for each plan year will be set forth on an addendum to the ABP. Any capitalized terms used in this section (and throughout the ABP with respect to a Participant who is an executive officer of the Company) but not otherwise defined herein, in connection with determining the annual incentive payouts for such Participant only, will have the meaning set forth in the Executive AIP. In the event of a conflict between any term or provision contained in the ABP and a term or provision of the Executive AIP, the terms and provisions of the Executive AIP will govern and prevail.

7. Administrative Guidelines

a. The ABP is an annual bonus plan based on Company and individual performance from January 1^st through December 31^st (the “plan year”).

b. Any payouts with respect to a plan year will be distributed once a year, between January 1^st and no later than March 15^th of the year immediately following the end of such plan year.

India: Any payouts will be distributed once a year and no later than March 31^st following the end of the applicable plan year.

c. Participants must be actively employed by the Company at the time of payout in order to be eligible to receive a payout, unless otherwise required by law.

d. Employees promoted or transferred into an ABP eligible position may participate in the ABP effective as of the first day they were employed in an ABP eligible position. The ABP payment will be prorated daily based on the length of time such employee works in the ABP eligible position during the plan year.

e. Participants transferring from an ABP eligible position to non-ABP eligible positions will be eligible to receive an ABP payout, prorated on a daily basis for the portion of the plan year in which they were employed in an ABP eligible position, provided that the Company pays a bonus under the ABP to other Participants for that plan year.

f. ABP payouts for Participants who are promoted or transferred from one ABP level to another during the plan year will be eligible to receive an ABP payout, prorated on a daily basis based on the length of time in each position during the year.

SECTION: AOL INC. ANNUAL BONUS PLAN 5

HIGHLY CONFIDENTIAL: AOL INTERNAL USE ONLY [AOL LOGO]

g. Employees transferring to or from a sales or other incentive/bonus eligible position are eligible for a prorated ABP payout for the time they were in an ABP eligible position during the plan year, in accordance with the guidelines set forth in this plan.

h. Participants on an approved leave of absence are eligible for a prorated ABP payout for the time period during the plan year that they were scheduled to work 25 or more hours per week.

India - Participants on an approved leave of absence without pay (Loss of Pay leave) are eligible for an ABP payout only for the prorated time period when they were either at work or on approved leave of absence with pay during the applicable plan year. Such Participants are eligible for payment only upon return to work. If a Participant does not return from a leave of absence without pay, the individual will not receive a bonus payment.

Canada - Participants on an approved leave of absence are eligible for a prorated ABP payout for the time period during the applicable plan year that they were scheduled to work 25 or more hours/week. Participants are eligible for payment only upon a return to work. If a Participant does not return from a leave of absence, the individual will not receive a bonus payment.

i. The ABP allocation may not exceed 200% of a Participant’s bonus target.

j. In the event a Participant dies during the plan year, the Participant’s beneficiaries will receive a prorated ABP payout based on the number of days the Participant spent in an ABP eligible position during such plan year.

k. There is no guaranteed ABP payout.

8. Miscellaneous

a. Participation in the ABP does not constitute a contract of employment or a contractual agreement for payout. All elements of the ABP are at the discretion of the Company. This document is for informational purposes only. The ABP should not be considered to be a part of a Participant’s annual compensation. The Company reserves the right to modify, revoke, suspend, terminate, or disregard all plan practices, policies or procedures, in whole or in part, published or unpublished, at any time, with or without notice.

b. Management reserves the right to exercise discretion in calculating the ABP payout, and in setting or adjusting any values or factors used in the calculation of the ABP payout with respect to non-executive officer Participants only. Such discretion for Participants who are executive officers of the Company resides solely with the Committee (as defined in the Executive AIP) pursuant to the Executive AIP.

c. In the event of any inconsistency or conflict between the provisions of any other communications and the terms of this plan document, the terms outlined in this plan document will prevail.

SECTION: AOL INC. ANNUAL BONUS PLAN 6

HIGHLY CONFIDENTIAL: AOL INTERNAL USE ONLY [AOL LOGO]

d. Participants will not have the right to assign, pledge, or otherwise transfer any payments to which they may be entitled under the ABP.

e. The Company reserves the right to deduct any moneys owed to the Company by a Participant from any payout under the ABP prior to distribution, unless local or regional laws require otherwise.

f. The Company will be entitled to withhold from any payment due to a Participant any and all applicable income and employment taxes.

g. The ABP is intended to be exempt from Internal Revenue Code Section 409A.

SECTION: AOL INC. ANNUAL BONUS PLAN 7

EX-10.14

Exhibit 10.14

January 29, 2010

Polar Capital Group, LLC

200 Portland Street, Suite 301

Boston, MA 02114

Attn: Donald Armstrong

Chief Strategy and Investment Officer

Polar News Company, LLC

200 Portland Street, Suite 301

Boston, MA 02114

Attn: Donald Armstrong

Chief Strategy and Investment Officer

Re: AOL Inc. (successor by assignment to AOL LLC) / Patch Media Corporation Merger Consideration and Accrued Interest Payable to Polar Capital Group, LLC

Ladies and Gentlemen:

Reference is hereby made to (i) that certain Agreement and Plan of Merger, dated as of May 30, 2009, by and among AOL Inc., a Delaware corporation (successor by assignment to AOL LLC) (“Parent”), Pumpkin Merger Corporation, a Delaware corporation and a wholly owned Subsidiary of Parent (“Merger Sub”), Patch Media Corporation, a Delaware corporation (the “Company”), and Jon Brod, in his capacity as the Stockholders’ Agent (as the same may be amended, supplemented, modified and/or restated from time to time, the “Merger Agreement”); (ii) that certain Letter Agreement, dated as of June 10, 2009, by and among Parent, Polar News Company, LLC (“Polar News”) and Polar Capital Group, LLC’s (“Polar Capital”) (the “Polar Capital Consideration Side Letter”); and (iii) that certain Letter Agreement, dated as of August 5, 2009, by and among Parent, Polar News and Polar Capital (the “Accrued Interest Side Letter”). Capitalized terms used and not otherwise defined herein shall have the meaning ascribed to such terms in the Merger Agreement.

This letter is being delivered to document our mutual understanding regarding the implementation of the terms of the Polar Capital Side Letter and the Accrued Interest Side Letter with respect to a portion of the Polar Capital Merger Consideration (as such term is defined in the Polar Capital Consideration Side Letter). As of January 29, 2010, (i) the amount of Polar Capital Consideration (as such term is defined in the Polar Capital Consideration Side Letter) due to Polar Capital will be $4,110,269.51 (the “January 2010 Consideration Payment”), and (ii) the amount of accrued interest due to Polar Capital under the terms of the Accrued Interest Side Letter will be $1,215.19 (the “January 2010 Accrued Interest Payment”).

On January 29, 2010, after the close of trading on the New York Stock Exchange, in accordance with the terms of the Polar Capital Consideration Side Letter, Polar Capital will be issued 173,078 shares of common stock, $0.01 par value per share, of Parent (the “January 2010 Consideration Shares”) and paid $16.81 in cash in lieu of a fractional share in lieu of the January 2010 Consideration Payment and the January 2010 Accrued Interest Payment. Upon issuance of the January 2010 Consideration Shares and the $16.81 in lieu of a fractional share, Polar News or Polar Capital will cease to have any claim of any nature whatsoever with respect to, and Parent shall have no further obligation of any nature whatsoever to pay, the January 2010 Consideration Payment and the January 2010 Accrued Interest Payment.

Please indicate receipt of this letter agreement and acceptance of its terms and conditions by signing in the space provided below and returning to Parent an original signed copy of this letter.

AOL INC.
By:	/s/ Ira H. Parker
Name:	Ira H. Parker
Title:	Executive Vice President and General Counsel

Acknowledged and Agreed:

Polar Capital Group, LLC
By:	/s/ Jon Brod
Name:	Jon Brod
Title:	Manager
Polar News Company, LLC
By:	/s/ Jon Brod
Name:	Jon Brod
Title:	Manager

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EX-10.15

Exhibit 10.15

Via US mail

May 10, 2010

Revised June 4, 2010

Ira Parker

224 Lowell Road

Wellesley, MA 02481

Separation Agreement and Release of Claims

Dear Ira:

This letter will serve as confirmation that your employment with AOL Inc. (together with any successors, subsidiaries, merged entities, and their respective affiliates, “AOL” or “the Company”) is being terminated without cause. This Separation Agreement and Release of Claims (“Separation Agreement”), upon your signature after your Separation Date, will constitute the complete agreement between you and the Company regarding the terms of your separation from employment.

1. Your employment with the Company will terminate without cause at the close of business July 15, 2010 (your “Separation Date”) and the date of this letter shall be deemed your notification date (your “Notification Date”). Beginning on your Notification Date, you will remain an employee of the Company through your Separation Date (“Notification Period”). You shall continue to receive your base salary and benefits during this Notification Period. It is expected that you will perform your job satisfactorily. Your rights under any stock option or restricted stock unit awards shall be determined in accordance with the terms and provisions of the equity plans and agreements under which any grants of stock options or awards of restricted stock units were granted, based on a July 15, 2010 separation date. The Company reserves the right to change your Separation Date, but will notify you in writing of any change. If you obtain other employment with AOL within thirty days of your Separation Date, you will not be eligible to receive any of the benefits set forth in this Separation Agreement, unless specified herein, and this Separation Agreement shall become null and void.

2. On the next regularly scheduled pay date following your Separation Date, or sooner if local law requires, you will receive a check for all unpaid wages and any accrued, unused vacation or paid time off from January 1, 2010, or longer if required by state law, due through your Separation Date, less applicable deductions and withholdings.

3. Your medical, dental and vision benefits will continue through the end of the month in which your Separation Date occurs. The date of the qualifying event for purposes of the Consolidated Omnibus Budget Reconciliation Act (“COBRA”) shall be your Separation Date. You will receive separate information regarding your option to continue health benefits under

COBRA after your Separation Date. Your Company-paid life insurance will continue through the end of the month in which your Separation Date occurs. All other benefits will terminate on your Separation Date.

4. Prior to your departure on your Separation Date, unless otherwise instructed by an authorized Company representative, you must:

a. resign from any and all positions you hold as an officer and/or director of AOL Inc. and from each of its direct and indirect subsidiaries and/or affiliates; and

b. return to your manager all the Company property in your possession, including, but not limited to, your identification badge and SecurID, keys, computers, corporate credit cards, pagers, telephones, parking permits and the original and all copies of any written, recorded, or computer readable information about Company practices, procedures, trade secrets, customer lists or product marketing associated with the Company’s business and any other information deemed proprietary or confidential in accordance with Company policies or the Company’s Confidential Information, Non-Competition and Proprietary Rights Agreement (the “CNPR Agreement”). By signing this Separation Agreement, you represent that you have returned all Company confidential or proprietary information in your possession and that you took all reasonable steps to protect the confidentiality of such Company information during your employment. You agree that you are bound by (a) all the terms of the Standards of Business Conduct through your Separation Date and (b) the Company’s CNPR Agreement, which remains in full force and effect after your Separation Date and includes, among other obligations, the continuing duty not to disclose Company confidential or proprietary information after your Separation Date. Notwithstanding anything in the CNPR Agreement to the contrary, you shall not be prevented from owning, controlling, managing or working for any business except that, for the six-month period immediately following the Separation Date (the “Restricted Period”), you agree that you will not accept employment by Bloomberg, Demand Studios, Yahoo!, Inc., Google Inc., Microsoft Corporation, IAC/InterActive Corp., News Corp, Viacom Inc. or Disney, or any of their respective subsidiaries, affiliates or successors (each a “Restricted Entity”); provided that this restriction does not prevent you from (i) working in a capacity that does not compete with the specific business of the Company in which you were engaged or had material knowledge during the last two years of your employment with the Company. In the event that you wish to work for one of the Restricted Entities during the Restricted Period, you may send a written notice of that request to the Company, at which time the Company may elect to waive the application of this Paragraph 4 and to allow you to work for that Restricted Entity during the Restricted Period.

5. In addition, pursuant to your January 7, 2008 employment agreement (“Employment Agreement”) and under the terms and conditions as detailed below, the Company will agree to provide you additional payments and benefits, which you acknowledge are payments and benefits to which you are otherwise not entitled, if you sign this Separation Agreement. If you do not sign this Separation Agreement, you will not receive the additional payments and benefits.

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6. In exchange for your execution of this Separation Agreement, the Company will provide you the following and the following terms shall apply:

a. An amount equal to eighteen (18) months of your current Base Salary, $825,000, less applicable withholdings, payable in a lump sum, subject to Paragraph 6(e) below. This payment will not be eligible for deferrals to the Company's 401(k) plan.

b. Subject to the terms of Paragraph 17 of your Employment Agreement, you will receive an amount equal to a pro-rated bonus payment for the period from January 1, 2010 through your Separation Date, payable at target (an amount equal to $295,342.47), less tax withholdings, paid in a lump sum, subject to Paragraph 6(e) below. This payment will not be eligible for deferrals to the Company’s 401(k) plan.

c. If you elect to enroll in COBRA benefit continuation, the Company will pay the cost of medical, dental and vision benefit coverage under COBRA for eighteen (18) months beginning the first day of the calendar month following the termination of your employment.

d. The services of a professional outplacement and counseling firm, for eighteen (18) months to assist you in securing employment following your separation from employment with the Company, not to exceed $25,000.00 and to be paid via invoice to the firm directly.

e. The payments made under Paragraphs 6(a) and 6(b) will be paid within thirty (30) days of your Separation Date or the “effective date” of the signed Separation Agreement, as set forth in Paragraph 17 below, whichever is later, but no later than March 15 of the calendar year following the termination of your employment.

f. You shall not be entitled to notice and severance under any policy or plan of the Company (the payments set forth in this Paragraph being given in lieu thereof).

g. Except as set forth above, you shall not be entitled to receive any other bonus or pro-rated bonus payment.

h. The payments under Paragraphs 6(a) and 6(b) shall be made without regard to any duty to mitigate damages and shall not be reduced by any compensation received by you from any subsequent employment.

7. The payments and other benefits set forth in Paragraph 6 are being offered solely in consideration for your execution of this Separation Agreement, including a release of all claims against the Company as set forth in Paragraph 8 below. The payments are not an admission of any wrongdoing by the Company.

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8. In exchange for the Company’s agreement as stated above, you agree to release and discharge unconditionally the Company and any of its past or present subsidiaries, affiliates, related entities, predecessors, merged entities and parent entities, benefit plans, and all of their respective past and present officers, directors, stockholders, employees, benefit plan administrators and trustees, agents, attorneys, insurers, representatives, affiliates, and all of their respective successors and assigns, from any and all claims, actions, causes of action, demands, obligations or damages of any kind arising from your employment with the Company and the separation from that employment or otherwise, whether known or unknown to you, whether under federal, state or local law (whether constitutional, statutory, regulatory or decisional) which you ever had or now have upon or by reason of any matter, cause or thing, up to and including the day on which you sign this Separation Agreement. Without limiting the generality of the foregoing, the claims you are waiving include, but are not limited to, all claims arising out of or related to any stock options held by you or granted to you by the Company which are scheduled to vest subsequent to your Separation Date; all claims of discrimination or harassment on the basis of sex, race, age, national origin, religion, sexual orientation, disability, veteran status or any other legally protected category, and of retaliation; all claims under Title VII of the Civil Rights Act of 1964, the Age Discrimination in Employment Act, the Older Workers Benefit Protection Act (“OWBPA”), the Americans with Disabilities Act, and all other federal, state and local fair employment and anti-discrimination laws, all as amended; all claims under the Worker Adjustment and Retraining Notification Act (WARN) and similar state and local statutes, all as amended; all claims under the National Labor Relations Act, as amended; all claims under the Family and Medical Leave Act and other federal, state and local leave laws, all as amended; all claims under the Employee Retirement Income Security Act (except with respect to accrued vested benefits under any retirement or 401(k) plan in accordance with the terms of such plan and applicable law); all claims under 42 U.S.C. § 1981, as amended; all claims under the Sarbanes-Oxley Act of 2002; all claims of whistleblowing and retaliation under federal, state and local laws; all claims under any principle of common law or sounding in tort or contract; all claims concerning any right to reinstatement; all claims for attorneys’ fees, costs, damages or other relief (monetary, equitable or otherwise) from the Company, whether under federal, state or local law, whether statutory, regulatory or common law, to the fullest extent permitted by law. Further, each of the persons and entities released herein is intended to be a third-party beneficiary of this Separation Agreement. This release of claims does not affect or waive any claim for workers’ compensation benefits, unemployment benefits or other legally non-waivable rights or claims; claims that arise after you sign this Separation Agreement; your right to exercise any and all Company stock options held by you that are exercisable as of your Separation Date during the applicable period of exercise and in accordance with all other terms of those options and the stock options plans, agreements, and notices under which such options were granted; or your right to enforce the terms of this Separation Agreement. Additionally, nothing in this Separation Agreement waives or limits your right to file a charge with, provide information to or cooperate in any investigation of or proceeding brought by a government agency (though you acknowledge you are not entitled to recover money or other relief with respect to the claims waived in this Separation Agreement).

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Notwithstanding the foregoing, in the event any of the Company’s successors, subsidiaries, affiliates, related entities, predecessors, merged entities and parent entities, and their respective officers, directors, stockholders, employees, benefit plan administrators and trustees, agents, attorneys, insurers, representatives, affiliates, successors and assigns bring any claim against you, you shall have the right to fully defend against such claims and may bring any counterclaims against such individuals or entities, without regard to this release.

9. In exchange for your agreement and covenants contained in this Separation Agreement, the Company agrees to release and discharge you unconditionally, from any and all claims, action, causes of action, demands, obligations or damages of any kind arising out of or relating to your employment with the Company, the separation of that employment, whether known or unknown to them, which they ever had or now have upon or by reason of any matter, cause or thing, up to and including the day on which the Company signs this Separation Agreement. The claims they are waiving include, but are not limited to, all claims under any principle of regulatory or common law, and whether tort, contract or otherwise, to the fullest extent permitted by law. This release of claims does not affect the Company’s right to enforce the terms of this Separation Agreement.

10. The Company shall provide a neutral reference for any inquiries from prospective employers, and shall affirmatively state that the Company’s policy is to provide only a neutral reference, and they will provide only the dates of employment, positions held, and salary information, if appropriate. In response to any question from a prospective employer or agent of a prospective employer as to whether you are eligible for rehire, the Company shall respond that you are eligible for rehire.

11. You agree to assist the Company, in connection with any litigation, investigation or other matter involving your tenure as an employee, officer, or director of the Company, including, but not limited to, meetings with Company representatives and counsel and giving testimony in any legal proceeding involving the Company. The Company will pay you reasonable compensation (to be mutually agreed upon at the time of request for your services) for the time you spend on such matters (not including attorney’s fees unless required by federal, state or local law) and will reimburse you for all reasonable out-of-pocket expenses incurred in rendering such assistance to the Company.

12. The parties understand and agree that the terms of this Separation Agreement are confidential and agree not to disclose to others the terms of this Separation Agreement, except as otherwise permitted or required by law, to a government agency in connection with any charge or investigation, in connection with a dispute arising out of this Separation Agreement, or with the written consent of the other; provided however, that this Paragraph 12 does not preclude disclosure to your immediate family or for purposes of securing professional financial, tax or legal services, and for the Company, on a strictly need to know basis, provided further that, prior to making any such disclosure, the parties will inform any such persons that this confidentiality clause is in effect and that they are also bound by it.

13. The parties agree not to affirmatively encourage or assist any person or entity in litigation against each other in any manner. This provision does not affect the claims and rights that you have not waived as set forth in Paragraph 8, and does not prohibit each party’s

5

response to a valid subpoena for documents or testimony or other lawful process; however, such receiving party agrees to provide each other with prompt notice of any such subpoena or process. The parties further agree that this Separation Agreement is not admissible in any proceeding except one to enforce the terms of this Separation Agreement.

14. The parties agree not to make disparaging or untruthful remarks or statements about each other. The Company further agrees that it will take measure to ensure that its senior executives (defined as the CEO and all direct reports to the CEO) do not make any disparaging or untruthful remarks or statements about your employment with the Company. Nothing in this Separation Agreement prevents you or the Company from making truthful statements when required by law, court order, subpoena, or the like, to a governmental agency or body.

15. In accordance with the terms of this Separation Agreement, you agree that in the event you are found in a court of law or by another adjudicator with jurisdiction to hear the matter to be in breach any of your obligations under Paragraphs 4, 11, 12, 13 and 14 of this Separation Agreement, the Company will be entitled to recover the full amount paid under Paragraph 6 above and to obtain all other remedies provided by law or in equity. In the event the Company is found in a court of law or by another adjudicator with jurisdiction to hear the matter to be in breach of its obligations under this Separation Agreement, you will be entitled to appropriate relief as determined.

16. If any term or clause of this Separation Agreement should ever be determined to be unenforceable, you and the Company agree that this will not affect the enforceability of any other term or clause of this Separation Agreement.

17.    a)     If you are under age 40 on your Separation Date:

You should consider consulting an attorney before executing this Separation Agreement. You have seven (7) days from your Separation Date in which to sign and return the Separation Agreement, although you may, at your discretion, sign and return the Separation Agreement at any earlier time, after your Separation Date. The day you return the executed Separation Agreement is the “effective date” of this Separation Agreement. If you have not returned the executed Separation Agreement within the time permitted, then the Company’s offer will expire by its own terms at such time.

b) If you are age 40 or older on your Separation Date:

Pursuant to the Older Workers Benefit Protection Act of 1990 (“OWBPA”), you are advised: (1) to consult an attorney regarding this Separation Agreement before executing the Separation Agreement; (2) that you are waiving rights or claims which may be waived by law in exchange for consideration which is not otherwise due to you; (3) that rights or claims, including those arising under the Age Discrimination in Employment Act of 1967 (ADEA), that may arise after the date this Separation Agreement is executed are not waived; (4) that you have twenty-one (21) days from the date you received this Separation Agreement in

6

which to sign and return the Separation Agreement, although you may, at your discretion, knowingly and voluntarily, sign and return the Separation Agreement at any earlier time after your Separation Date; (5) that at any time within seven (7) days after executing this Separation Agreement, you may revoke the Separation Agreement; and (6) that this Separation Agreement is not enforceable until the revocation period has passed without a revocation. You acknowledge that by signing this Separation Agreement, you are giving up claims and rights under the Age Discrimination in Employment Act of 1967 as amended, as described above.

To revoke, you must send a written statement of revocation delivered by certified mail to AOL Inc., Attn: Gillian Pon, 22000 AOL Way, Dulles, VA 20166. The revocation must be received no later than 5:00 p.m. on the seventh day following your execution of this Separation Agreement. If you do not so revoke, the eighth day following your acceptance will be the “effective date” of this Separation Agreement. If you have not returned the executed Separation Agreement within the time permitted, then the Company’s offer will expire by its own terms at the conclusion of the time permitted.

18. This Separation Agreement shall be governed by and construed and enforced in accordance with the substantive laws of the State of New York applicable to agreements made and to be performed entirely in New York without regard to the principles of conflicts of law.

To accept the Separation Agreement, you must sign below on or after your Separation Date and return one entire copy to AOL Inc., Attn: Gillian Pon, 22000 AOL Way, Dulles, VA 20166. (An extra copy for your files is enclosed.)

Sincerely,

/s/ David J. Harmon

David J. Harmon

Executive Vice President,

  Human Resources and Corporate Services

AOL Inc.

By signing this Separation Agreement, I acknowledge that: I have had the opportunity to review this Separation Agreement carefully with legal or other personal advisors of my own choice; I understand that by signing this Separation Agreement I am releasing the Company of all claims against it; I have read this Separation Agreement and understand its terms; I have been given a reasonable period of time to consider its terms and effect and to ask any questions I may have; I voluntarily agree to the terms of this Separation Agreement.

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AGREED AND ACCEPTED:
/s/ Ira Parker	6/10/10
Ira Parker	Date

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EX-31.1

Exhibit 31.1

CERTIFICATION

PURSUANT TO SECURITIES EXCHANGE ACT RULE 13a-14(a)

I, Timothy M. Armstrong, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q for the quarter ended June 30, 2010 of AOL Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

c. Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 4, 2010	By:	/s/ Timothy M. Armstrong
		Name:	Timothy M. Armstrong
		Title:	Chairman and Chief Executive Officer (Principal Executive Officer)

EX-31.2

Exhibit 31.2

CERTIFICATION

PURSUANT TO SECURITIES EXCHANGE ACT RULE 13a-14(a)

I, Arthur Minson, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q for the quarter ended June 30, 2010 of AOL Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

c. Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 4, 2010	By:	/s/ Arthur Minson
		Name:	Arthur Minson
		Title:	Executive Vice President and Chief Financial Officer (Principal Financial Officer)

EX-32.1

Exhibit 32.1

CERTIFICATION

PURSUANT TO 18 U.S.C. SECTION 1350,

AS ENACTED BY SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q for the quarter ended June 30, 2010 of AOL Inc. (“the Company”), as filed with the Securities and Exchange Commission on the date hereof (the “Report”), each of the undersigned officers of the Company certifies, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to his respective knowledge:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: August 4, 2010	/s/ Timothy M. Armstrong
	Timothy M. Armstrong
	Chairman and Chief Executive Officer (Principal Executive Officer)

Date: August 4, 2010	/s/ Arthur Minson
	Arthur Minson
	Executive Vice President and Chief Financial Officer (Principal Financial Officer)