Stockholders' Equity

12 Months Ended

Dec. 31, 2013

Stockholders' Equity Note [Abstract]

Stockholders' Equity

Stockholders’ Equity

j2 Preferred Stock

In connection with the December 31, 2013 reorganization of Ziff Davis, Inc. ("ZD Inc.") into Ziff Davis, LLC ("ZD LLC") and the Company's acquisition of all of the minority holders' equity interests in ZD Inc., the Company issued j2 Series A Preferred Stock ("j2 Series A Stock") and j2 Series B Preferred Stock ("j2 Series B Stock").

j2 Series A Stock

Each share of j2 Series A Stock has a stated value of $1,000 and the aggregate stated value of all shares of Series A Stock is $5,064,000. The j2 Series A Stock is not convertible into any other securities. In the event ZD LLC pays any dividends or distributions to the Company in respect of the Company’s membership interests in ZD LLC (subject to certain exceptions in respect of senior interests), holders of the j2 Series A Stock will be entitled to receive a dividend in the aggregate with respect to all j2 Series A Stock equal to 2.4449% of such ZD LLC dividend (but only to the extent such dividend and all other dividends paid in respect of the series A preferred stock does not exceed a compounded annual rate of 15% on the stated value of the j2 Series A Stock).

The j2 Series A Stock has a liquidation preference over the j2 Series B Stock and a liquidation preference over j2 common stock in an amount up to, with respect to all shares of j2 Series A Stock, 2.4449% of the assets of ZD LLC and its subsidiaries legally available for distribution to the Company, after reduction in respect of certain senior interests (the "series A minority portion"), but in no event in an amount that exceeds the stated value of the j2 Series A Stock increased at a compounded annual rate of 15% (the "series A cap") and in no event in an amount that exceeds the lesser of the Company’s assets available for distribution and 2.4449% of the assets of ZD LLC and its subsidiaries legally available for distribution to the Company. 

On or after January 2, 2019, the j2 Series A Stock will be mandatorily redeemable by the Company upon the occurrence of certain contingent liquidity events such as a sale, initial public offering or spin-off transactions involving ZD, LLC. Any or all of the j2 Series A Stock is subject to redemption by the Company at its option at any time. If the redemption occurs in connection with certain sale, initial public offering or spin-off transactions involving ZD LLC, the redemption price will be equal to an allocable portion of the enterprise value of ZD, LLC implied by such transaction with respect to the series A minority portion and based on certain factors to be determined by the Company’s Board of Directors in its sole good faith judgment, but in no event in an amount that would exceed the series A cap. If not in connection with such a transaction, the redemption price will be the series A cap. 

j2 Series B Stock

The j2 Series B Stock is not convertible into any other securities.  In the event ZD LLC pays any dividends or distributions to the Company in respect of the Company’s membership interests in ZD LLC (subject to certain exceptions in respect of senior interests and the j2 Series A Stock), holders of the j2 series B preferred stock will be entitled to receive a dividend in the aggregate with respect to all j2 Series B Stock equal to 9.5579% of such ZD LLC dividend.

The j2 Series B Stock will have a liquidation preference junior to the liquidation preference of the j2 Series A Stock and a liquidation preference over the j2 common stock in an amount up to, with respect to all shares of j2 Series B Stock, 9.5579% of the assets of ZD LLC and its subsidiaries legally available for distribution to the Company, after reduction in respect of the j2 Series A Stock and certain other senior interests (the "series B minority portion"), but in no event in an amount that exceeds the lesser of the Company’s assets available for distribution and 9.5579% of the assets of ZD LLC and its subsidiaries legally available for distribution to the Company.

On or after January 2, 2019, the j2 Series B Stock will be mandatorily redeemable by the Company upon the occurrence of certain contingent liquidity events such as a sale, initial public offering or spin-off transactions involving ZD LLC. Any or all of the j2 Series B Stock is subject to redemption by the Company at its option at any time. If the redemption occurs in connection with certain sale, initial public offering or spin-off transactions involving ZD LLC, the redemption price will be equal to an allocable portion of the enterprise value of ZD LLC implied by such transaction with respect to the series B minority portion and based on certain factors to be determined by the Board of Directors of the Company in its sole good faith judgment. Otherwise, the redemption price will be equal to the fair market value of such share as determined by the Company’s Board of Directors in its sole good faith judgment.

The terms of the j2 Series A Stock and j2 Series B Stock are more fully described in the Certificates of Designation establishing the terms of such securities which are included as Exhibits 3.1 and 3.2 to the Current Report on Form 8-K filed by the Company on January 3, 2014.

Non-Controlling Interest

Non-controlling interests represents equity interests in consolidated subsidiaries that are not attributable, either directly or indirectly, to j2 Global (i.e., minority interests). Non-controlling interests includes the minority equity holders' proportionate share of the equity of Ziff Davis, Inc.

Ownership interests in subsidiaries held by parties other than the Company are presented as non-controlling interests within stockholders' equity, separately from the equity held by the Company on the consolidated statements of stockholders' equity. Revenues, expenses, net income and other comprehensive income are reported in the consolidated financial statements at the consolidated amounts, which includes amounts attributable to both the Company's interest and the non-controlling interests in Ziff Davis. Net income and other comprehensive income is then attributed to the Company's interest and the non-controlling interests. Net income to non-controlling interests is deducted from net income in the consolidated statements of income to determine net income attributable to the Company's common shareholders.

In connection with the December 31, 2013 reorganization of ZD, Inc. into ZD, LLC, the Company acquired all of the minority holders' equity interests in ZD, Inc. As a result, on December 31, 2013, ZD LLC became a wholly-owned subsidiary of j2 Global, Inc. and the non-controlling interest was no longer outstanding.

Common Stock Repurchase Program

In February 2012, the Company’s Board of Directors approved a program authorizing the repurchase of up to five million shares of j2 Global common stock through February 20, 2013 (See Note 22 - Subsequent Events - for a discussion regarding the extension of the share repurchase program through February 20, 2015). On February 15, 2012, the Company entered into a Rule 10b5-1 trading plan with a broker to facilitate the repurchase program. At December 31, 2013, 2.1 million shares were repurchased at an aggregate cost of $58.6 million (including an immaterial amount of commission fees).

Periodically, participants in j2 Global’s stock plans surrender to the Company shares of j2 Global stock to pay the exercise price or to satisfy tax withholding obligations arising upon the exercise of stock options or the vesting of restricted stock. During the year ended December 31, 2013, the Company purchased 105,828 shares from plan participants for this purpose.

Dividends

The following is a summary of each dividend declared during fiscal year 2013:

Declaration Date	Dividend per Common Share		Record Date	Payment Date
February 12, 2013	$	0.2325	February 25, 2013	March 4, 2013
May 7, 2013	$	0.24	May 20, 2013	June 4, 2013
August 7, 2013	$	0.2475	August 19, 2013	September 3, 2013
November 5, 2013	$	0.255	November 18, 2013	December 4, 2013

On February 11, 2014, the Company's Board of Directors approved a quarterly cash dividend of $0.2625 per share of common stock payable on March 10, 2014 to all stockholders of record as of the close of business on February 24, 2014 (See Note 21 - Subsequent Events). Future dividends will be subject to Board approval.

Treasury Stock

On August 14, 2012, the Company retired all treasury stock (which resulted from prior stock repurchases) on its balance sheet. Accordingly, such treasury stock is zero as of December 31, 2013 and 2012.