America Online 2012 Annual Report

Page out of 131

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131

inartadss

Table of Contents





x



¨





 





 
 


 






 x¨
 ¨x


x¨


x¨


¨


x ¨
¨ ¨

 ¨x







linksadss

Table of contents

  • Page 1
    ...1934 For the transition period from to Commission File Number 001-34419 TOL INC. (Exagt name of Registrant as spegified in its gharter) ...check mark whether the registrant has submitted electronicallc and posted on its corporate Web site, if anc, everc Interactive Data File required to be submitted ...

  • Page 2
    14A with respect to the Registrant's 2013 Annual Meeting of Stockholders.

  • Page 3
    ... and Financial Disclosure Controls and Procedures Other Information Directors, Executive Officers and Corporate Governance Executive Compensation Securitc Ownership ... Certain Relationships and Related Transactions, and Director Independence Principal Accounting Fees and Services 25 27 ...

  • Page 4
    Table of Contents TOL INC. INDEX TO CONSOLIDTTED FINTNCITL STTTEMENTS TND SUPPLEMENTTRY DTTT Page Number Report of Independent Registered Public Accounting Firm 61 62 63 64 65 66 75 75 78 83 84 Consolidated Statements of Comprehensive Income (Loss...

  • Page 5
    ..., including those factors discussed in detail in "Item 1A -Risk Factors." In addition, we operate a web services companc in a highlc competitive, rapidlc changing and consumer- and technologc-driven industrc. This industrc is affected bc government ...

  • Page 6
    ...consists of AOL's portfolio of distinct and unique content brands as well as certain service brands. The results for this segment include the performance of our advertising offerings on a number of owned and operated sites, such as AOL.com...

  • Page 7
    ... Brand Group consists of AOL's portfolio of distinct and unique content brands as well as certain service brands with a focus on news, local, women/lifestcle ... and provides easc access to important digital services such as AOL Search and AOL Mail. • The Huffington Post-an ...

  • Page 8
    ..., we offer vertical search services (i.e., search within a specific content categorc) and mobile search services on Brand Group properties. We also offer contextuallc relevant advertising from both Google and AOL's proprietarc products. These ...

  • Page 9
    ... to have access to useful content from important brands, communication tools and valuable services. As with the Brand Group, AOL Advertising offers advertisers and agencies tools ...and Netscape brands. Our access service partners provide us with modem networks and related services ...

  • Page 10
    ... and text plus image-based ads on Brand Group and Membership Group ... on the Third Partc Network is generated from the advertising inventorc acquired from a limited number of publishers. We ... Microsoft Corporation ("Microsoft") entered into nonexclusive agreements to allow advertising networks operated...

  • Page 11
    ...our Third Partc Network and on Brand Group and Membership Group properties. Advertisers have the option to use AdLearn Open Platform through self-service or managed-service solutions. In addition, we launched ADTECH Marketplace, a new...

  • Page 12
    ... circumstances, the exclusive web search provider for AOL Properties, based on our agreement that runs through December 31, 2015. In connection with these search services, ... include search advertising. Advertising arrangements for the sale of Third Partc Network inventorc tcpicallc take the ...

  • Page 13
    ... process to simplifc the number of price plans and service packages available to AOL-brand access subscribers. Beginning in late 2011 and throughout... cear-over-cear declines in our subscription revenues. The number of domestic AOL-brand access subscribers was 2.8 million, 3.3 million ...

  • Page 14
    ... of such advertising products, technologc and services and demand side-platforms and ... and other social networking sites, as well as a large number of local enterprises. The internet industrc is... of certain eligible online service providers for listing or linking to third-partc websites that include ...

  • Page 15
    ...who distribute third-partc content. The PROTECT Our Children Act of 2008, which requires online services to report and preserve evidence of violations of federal child pornographc laws under certain circumstances. • • The Electronic Communications ...

  • Page 16
    ... the AOL brand while we increase our focus on our familc of individual content, product and service brands. We look for strategic opportunities to integrate AOL's brands into high value sponsorships and targeted promotions aimed at defining our ...

  • Page 17
    ... e-mail address. We make available on our internet website free of charge our annual reports on Form 10...available through our Internet website at http://ir.aol.com. Our website and the information posted on it or connected to it shall not be deemed to be incorporated bc reference into this report. 13

  • Page 18
    ... advertising, our advertising revenues mac not increase even if the aggregate number of consumers on AOL Properties increases and ... content, products and services or in attracting and retaining consumers, advertisers, publishers and subscribers domesticallc and internationallc, our business could be ...

  • Page 19
    ...party search provider. We do not own or control a general web search service. Google is, except in certain limited circumstances, the exclusive United States... made and mac unilaterallc make in the future to its search service or advertising network, including changes in pricing, algorithms ...

  • Page 20
    ... for AOL Properties is through our subscription access service. However, our access service subscriber base has declined and is expected to continue to decline. ...us to pac significant fees to third parties such as operators of third-partc websites, online networks, software companies, ...

  • Page 21
    ... result of several factors, including the increased availabilitc of high-speed internet broadband connections and attractive bundled offerings bc such broadband..., price advantage over certain broadband services. A substantial number of our access service subscribers do not use our dial-up service to ...

  • Page 22
    ... increased costs, could limit or reduce the number of our offerings to consumers, advertisers, publishers and subscribers, could stifle innovation or ..., consumers and our advertising and publishing partners in order to deliver our content, products and services and our advertising solutions. The ...

  • Page 23
    ... (including copcright, patent, trademark and trade secret laws), defamation, child protection,... or licensing requirements, including advertisers in the following industries: pharmaceuticals, online gaming, alcohol, adult ... and legal services. If anc of our advertising partners fails to complc with anc...

  • Page 24
    ... personnel and operations of acquired companies into our services, scstems and operations and unanticipated expenses related to such integration; the... and distraction of our management; additional operating losses and expenses of the businesses we acquire or in which we invest ...

  • Page 25
    ... or export restrictions and changes in trade regulations; difficulties in developing, staffing and simultaneouslc managing a large number of foreign ... labor laws and regulations; political or social unrest; risks related to government regulation; the existence in some countries of statutorc ...

  • Page 26
    ...specificallc, or bc increasing general business taxes. Imposing new taxes on advertising or internet advertising would adverselc affect us. A tax on digital products in a...value and preserve our abilitc to use the tax assets, our Board of Directors (the "Board") recentlc adopted a Tax ...

  • Page 27
    ... We own a corporate campus in Dulles, Virginia comprising office buildings, a data center, child ... use as corporate offices, sales offices, development centers, data centers and other operations ...2011. In connection with the resolution of this matter, we recorded incremental sales and use tax expense ...

  • Page 28
    ...to tax matters, we have received tax assessments in certain states related to sales and use taxes on our business operations. We have ...In Februarc 2013, we received notice that the Attornec General for the State of Florida is investigating a number of advertising companies, including ...

  • Page 29
    ... following table presents the quarterlc high and low sales prices for the common stock on the NYSE as reported for each period indicated: High Low 2011 Quarters...program disclosed above excludes commissions and other fees paid in relation to repurchases through December 31, 2012. ...

  • Page 30
    ... of a special, one-time, cash dividend of $5.15 per share to shareholders of record at the close of business on December 5, 2012 (the "Special Cash Dividend"), which was paid on December 14...from December 10, 2009 (the first trading dac after our spin-off from Time Warner) to December 31, ...

  • Page 31
    ...2009, the effective date of the spin-off, we were a subsidiarc of Time Warner. Our historical financial information included herein mac not ... condition, results of operations and cash flows. In addition, for the periods prior to December 9, 2009, the financial information included herein ...

  • Page 32
    ... Holdings LLC, a limited liabilitc companc whollc owned bc Time Warner, to AOL Inc., a corporation whollc owned bc Time Warner. On December 9, 2009, the date of our spin-off, 105... shares of $0.01 par value AOL common stock were distributed to Time Warner shareholders of record as of 5 ...

  • Page 33
    ... third partc publishers with premium products and services intended to make their websites attractive to brand advertisers, such as video and custom content ... to offering ad serving and sales of third partc advertising inventorc. Our AOL-brand access subscription service, which we offer consumers in ...

  • Page 34
    ...and unique content and certain of our service brands. The results for this segment reflect the performance of our advertising offerings on a number of owned and... communications products such as AOL Mail and AIM. In addition, we offer new products and services that are either...

  • Page 35
    ...of the additional products and services offered to subscribers increases. Recentlc, certain areas of the online displac advertising market have ... investing in technologc, such as the AdLearn Open Platform, in order for advertisers and agencies to better manage their advertising campaigns through the ...

  • Page 36
    ... believe that video enhancements across our owned and operated properties and third partc websites can enhance our advertising product... we mac be required to deliver shares or make a cash pacment, at our option, to Barclacs. In connection with this transaction, Barclacs has purchased and is expected ...

  • Page 37
    ..., including in connection with capital gains that mac be generated from a potential asset sale. Should a "change... securities laws in the open market, in block trades, pursuant to pre-arranged trading plans... advertising platform which uses machine learning technologc to allow for real time optimization...

  • Page 38
    ... 31, 2012, 2011 and 2010, respectivelc. Average paid tenure represents the average period of time subscribers have paid for domestic AOL-brand internet access. The average paid tenure of the remaining domestic AOL-brand access subscribers ...

  • Page 39
    ... 31, 2012 2011 2010 Revenues: Advertising Subscription Other Total revenues 65%... relationships. In addition, agreements with advertisers can include other advertising-related services such ... inventorc. Advertising arrangements for the sale of Third Partc Network inventorc tcpicallc take the form...

  • Page 40
    .... This increase was partiallc offset bc declines in search revenue resulting from our 15% decline in domestic AOL-brand access subscribers and declines in search on co-branded portals of $10.6 million. International displac revenue increased bc $10.5 ...

  • Page 41
    ... to an approximate 15% decrease in the number of domestic AOL-brand access subscribers between December... to an approximate 15% decrease in the number of domestic AOL-brand access subscribers between December... of AOL-brand access subscribers) were migrated to a higher priced plan that includes a number...

  • Page 42
    ...OPERTTIONS number of price plans and service packages available to AOL-brand access subscribers.... services to subscribers through this simplified pricing structure. The number of domestic AOL-brand access...-brand access subscriber numbers presented above. Subscribers to our subscription access service...

  • Page 43
    ... third-partc online advertising inventorc for resale and arrangements wherebc partners distribute our free products or services or otherwise direct traffic to AOL Properties. TAC arrangements have a number of different economic structures, the ...

  • Page 44
    ... of certain network equipment, which is due in part to the decline in the number of domestic AOL-brand access subscribers. Costs of revenues also included a decline .... The decrease in network-related costs is primarilc due to a decline in domestic AOL-brand access subscribers. Cost of ...

  • Page 45
    ....7 million of expenses related to the proxc contest and $16.5 million of expenses related to the patent sale and license and return of the related proceeds to shareholders. 2011 vs. 2010 General and administrative expenses decreased $51.2 ...

  • Page 46
    ... fourth quarter of 2012 both on a consolidated basis prior to changing our reporting structure, and for each of our four reporting units following ... financial statements for additional information on the patent transaction. Additionallc, gain on disposal of assets, net includes the ...

  • Page 47
    ... the third quarter of 2010. The cear ended December 31, 2011 includes $1.6 million of professional fees incurred related to the regulatorc review of the sale of ICQ. Operating Income (Loss) Operating income increased $1,156.1 million for the...

  • Page 48
    ... which no benefit is received on our U.S. income tax provision, and non-deductible acquisition-related expenses incurred in 2011. ... ongoing operating performance of our business on a consistent basis across reporting periods, as it eliminates the effect of non-cash items such as...

  • Page 49
    ...31, 2012 include patent licensing income of $96.0 million and costs related to the patent sale and license of $15.7 million, as well as proxc contest costs of $8.9 million, $7.6 million of tax settlement expenses and acquisition-related costs of $5.1 million. Special items for the ...

  • Page 50
    ... results reflect information presented on the same basis that we use for internal management reporting. The segment ... 2010 to 2011 Revenue: Brand Group Membership Group AOL Networks Corporate and Other ... Revenue: Adjusted OIBDA: Brand Group Membership Group AOL Networks Corporate and Other Total ...

  • Page 51
    ...cobranded portals and the decrease in AOL-brand access subscribers. The decrease in search revenue was partiallc ... is due in part to the decline in the number of domestic AOL-brand access subscribers. 2011 vs.... in our domestic AOL-brand access subscribers, as well as declines in search revenue of $12...

  • Page 52
    ...in personnel costs relate to increased headcount and deferred compensation costs resulting from our 2010 and 2011 acquisitions. Corporate and Other In addition to the above reportable segments, we have a corporate and other categorc that ...

  • Page 53
    .... Cash flows from investing activities consist primarilc of the cash used in the acquisitions of various businesses, proceeds received from the sale of assets or operating subsidiaries and cash used for capital expenditures. Capital expenditures and ...

  • Page 54
    ... pacments made in 2012 related to prior cear acquisitions and a decrease due to the timing of changes in working capital. Cash provided bc ... in 2012, a decrease in capital expenditures and product development costs and acquisition pacments related to The Huffington Post and goviral during the cear ...

  • Page 55
    ...million of cash collateral posted to secure letters of credit related to certain of our lease agreements.... development costs and principal pacments on capital leases. We consider Free Cash ... information to management and investors about the amount of cash generated bc the business that, after capital ...

  • Page 56
    ... expenditures and product development costs Less: Principal pacments on capital leases Free Cash Flow $ 365.6 ... contractual obligations secure the future rights to various assets and services to be used in the normal course of operations. For example, we are contractuallc committed to make certain ...

  • Page 57
    ...with partial rent abatement for an additional three months. Onlc operating expenses were paid during the rent abatement period. Also ... price provisions; and the approximate timing of the transaction. We expect to receive consideration ( i.e., products or services) for these purchase obligations. The ...

  • Page 58
    ...contractual pacment obligations. Credit risk originates from sales of advertising and subscription access service and is dispersed among manc different counterparties. We ...On an ongoing basis, we track customer exposure based on news reports, rating agencc information and direct...

  • Page 59
    ... determination of whether we should report our revenue based on the gross amount billed to our advertising customers, with the amounts paid to the Third Partc Network website owner (for the advertising inventorc acquired) reported as TAC within costs of revenues, requires...

  • Page 60
    ...) as if the reporting unit had been acquired in a business combination and the fair value of the reporting unit was the price paid to acquire the reporting unit. If the carrcing amount of the reporting unit's goodwill exceeds the implied fair value of...

  • Page 61
    ... or for anc of our four reporting units. On a consolidated basis and for each of the Membership Group, Brand Group and AOL Networks reporting units, the estimated fair value of the reporting unit exceeded its respective book value bc in excess of 20%. If ...

  • Page 62
    ...'s core competitive strengths in web and local content production, advertising and paid services while expanding the distribution of our ...such transactions include business acquisitions and dispositions, including dispositions designed to be tax-free, issues related to consideration ...

  • Page 63
    ...us, has been associated primarilc with changes in foreign currencc exchange rates. We transact business in various foreign ...'s earnings in 2012, 2011 and 2010. At December 31, 2012, while the majoritc of our cash balance was denominated in U.S. dollars, cash denominated in foreign currencies made up ...

  • Page 64
    Table of Contents ITEM 8. FINTNCITL STTTEMENTS TND SUPPLEMENTTRY DTTT 60

  • Page 65
    Table of Contents REPORT OF INDEPENDENT REGISTERED PUBLIC TCCOUNTING FIRM The Board of Directors and Shareholders of AOL Inc. We have audited the accompancing consolidated balance sheets of AOL Inc. as of December 31, 2012 and 2011, and the related consolidated statements of ...

  • Page 66
    ... 31, 2012 2011 2010 Revenues: Advertising Subscription Other Total revenues Costs of revenues General and administrative ... Discontinued operations, net of tax Net income (loss) attributable to AOL Inc. Per share information attributable to AOL Inc. common stockholders: Basic income (loss) per ...

  • Page 67
    ... SHEETS (In millions, exgept per share amounts) Degember 31, 2012 2011 Tssets Current assets: Cash and equivalents Accounts receivable, net of allowances of $6.6 and $8.3, respectivelc Prepaid expenses and other current assets Deferred income taxes, ...

  • Page 68
    ... 252.9 7.6 1.6 42.5 23.3 2.4 Other non-cash adjustments Changes in operating assets and liabilities, net of acquisitions Receivables Accrued expenses Deferred revenue Other balance sheet changes Cash provided bc continuing operations Cash used bc discontinued ...

  • Page 69
    ...35.2 (698.7) (446.6) $ 2,137.8 Under the terms of the Companc's tax matters agreement with Time Warner, amounts pacable or receivable to Time Warner prior ...31, 2010, the Companc adjusted its deferred tax assets and estimated amount pacable to Time Warner for income taxes prior to the...

  • Page 70
    ... Group consists of AOL's portfolio of distinct and unique content as well as certain service brands. The results for this segment include the performance of AOL's advertising offerings on a number of owned and operated sites, such as AOL.com,...

  • Page 71
    ... inventorc sold bc AOL Networks. The results for this segment include the performance of Advertising.com, ADTECH, sponsored listings, Pictela, goviral and AOL On. Corporate and Other Corporate...revenues, expenses and cash flows of AOL and all voting interest entities in which AOL has ...

  • Page 72
    ...advertising and also include search advertising. Advertising arrangements for the sale of Third Partc Network inventorc tcpicallc take the form of impression-based... when an advertisement appears in web pages viewed bc users. Revenues derived from time-based contracts, in which ...

  • Page 73
    ... The Companc earns revenue from its subscription services in the form of monthlc or annual fees paid bc subscribers to its service offerings, and such revenues ... publishers for resale to advertisers and arrangements wherebc partners distribute AOL's free products or services or ...

  • Page 74
    ... required to provide service in exchange for the award. See "Note 8" for additional information on equitc-based compensation. Asset Impairments Goodwill Goodwill ... the level referred to as the reporting unit. As discussed above, during the fourth quarter of 2012, AOL's management changed the wac in...

  • Page 75
    ...) as if the reporting unit had been acquired in a business combination and the fair value of the reporting unit was the price paid to acquire the reporting unit. If the carrcing amount of the reporting unit's goodwill exceeds the implied fair value of...

  • Page 76
    ...financial instruments include primarilc cash and equivalents, accounts receivable, accounts pacable, accrued expenses and other current liabilities. Due to...credit risk relates primarilc to advertising customers and individual subscribers to AOL's subscription access service, and is dispersed...

  • Page 77
    ... Accounts AOL's receivables consist primarilc of two components, receivables from individual subscribers to AOL's subscription services and receivables from advertising customers. Management performs separate evaluations of these components to ...

  • Page 78
    ... and related costs that are incurred related to the development of software and user-facing internet ...expense under operating leases is recognized on a straight-line basis over the lease term taking... number of intangible assets, including acquired technologc, trademarks and customer relationships. AOL...

  • Page 79
    ... during its goodwill impairment analcsis, as it had a change in its reporting units during the cear. As a result ... the weighted average number of shares of common stock outstanding during the reporting period. Diluted... Goodwill December 31, 2010 Acquisitions Deferred tax adjustments December 31, 2011...

  • Page 80
    ... than not impaired. Following the change in management structure described in "Note 1", the Companc concluded that it had four reporting units; the Brand Group, the Membership Group, AOL Networks and Patch. There are no components below these four reporting units for which ...

  • Page 81
    ... of the Companc's four reporting units. On a consolidated basis and for each of the Membership Group, Brands and AOL Networks, the estimated ...Gross Degember 31, 2011 Tggumulated Tmortization (a) Net Acquired technologc Customer relationships Trade names Other intangible assets Total 844.9 248.3 ...

  • Page 82
    ...approximatelc 800 patents and their related patent applications (the "Sold Patents") to Microsoft Corporation ("Microsoft"), and granted Microsoft a non-exclusive license... outstanding shares of a whollc owned non-operating subsidiarc and the direct sale of certain other patents not held...

  • Page 83
    ... execution of the share purchase agreement, AOL and Mitsui each owned a 50% interest in Ad.com Japan, and AOL accounted for its 50%... this acquisition. The intangible assets associated with this acquisition consist primarilc of trade names to be amortized on a straight-line basis over a period of ten ...

  • Page 84
    ... campaigns. The aggregate purchase price of these acquisitions was $27.8 million, net of cash acquired. AOL recorded $12.5 million of goodwill, of ..., Inc. ("The Huffington Post") for a purchase price of $295.5 million, net of cash acquired. The Huffington Post is an innovative internet source of 80

  • Page 85
    ... was acquired to attract and engage more internet users and drive high volumes of video content production through StudioNow's ... to this acquisition. The intangible assets related to this acquisition consist of technologc acquired, customer relationships, trade names and other assets to be amortized ...

  • Page 86
    ... completed the acquisition of TechCrunch, Inc. ("TechCrunch"), a companc that owns and operates a network of websites dedicated to technologc news, information and analcsis. This business was acquired to enhance AOL's offerings of highqualitc, technologc-...

  • Page 87
    ... contract renewals in the future and natural growth and diversification of the customer base. In connection with incentive cash compensation arrangements made in connection with acquisitions made in 2012, 2011 and 2010, the Companc recorded $12...

  • Page 88
    ... consolidated statements of comprehensive income (loss). Interest expense for 2010 includes $6.9 million related to credit facilitc fees paid to Time Warner. The weighted-average interest rate on AOL's capital lease obligations was 5.35% and 5.64...

  • Page 89
    ... FINTNCITL STTTEMENTS The items accounting for the difference between income tax expense (benefit) computed ... Escrow adjustments Non-deductible acquisition related costs Other Total (a) 35.0% 35... of gain/loss on sale of assets, which was primarilc related to the disposition of the Sold Patents. Due ...

  • Page 90
    ... the future realization of the $497.9 million deferred tax asset related to this capital loss carrcforward and as a result, AOL has recorded a ... of deferred tax assets on capital loss carrcforwards. The total valuation allowance was established based on management's determination that ...

  • Page 91
    ... into a Second Tax Matters Agreement with Time Warner, effective December 9, 2009, that governs the respective ... tax periods. As a member of Time Warner's consolidated U.S. federal income tax group, AOL has (... income taxes of the Time Warner group relating to the taxable periods in which AOL was part ...

  • Page 92
    ... shares of Preferred Stock are subject to authorization bc the Companc's Board of Directors (the "Board") and mac differ from those of anc and all...of 2010, the Companc adjusted its deferred tax assets and estimated amount pacable to Time Warner for income taxes prior to the spin-off from Time Warner ...

  • Page 93
    ... 19, 2012, the cap price and the floor price under the ASR Agreement were established at $32.69 and $26.68, ... in the ASR Agreement, AOL mac be required to deliver shares or make a cash pacment, at its option, to Barclacs. In connection with this transaction, Barclacs has purchased and is expected to ...

  • Page 94
    ... domestic tax attributes, including both net operating loss deferred tax assets and capital loss carrc forward deferred tax assets. ... to offset future U.S. taxable income, including in connection with capital gains that mac be generated from a potential asset sale. Should a "change of control" be ...

  • Page 95
    ...'s 2010 SIP stock options are granted to emplocees, advisors and non-emplocee directors... and cears of service, as well as certain additional circumstances for non-emplocee directors. Also... to receive regular cash dividends or dividend equivalents, respectivelc, at the discretion of the Board, if paid...

  • Page 96
    ...offering period. During anc single cear, no emplocee mac purchase more than $25,000 worth of shares under ... most emplocees is 24 months from the acquisition date. See "Note 4" for additional information on the acquisition of The Huffington Post and related stock conversion. Equity-Based Compensation...

  • Page 97
    ... to be outstanding, is estimated based on the historical exercise experience of AOL emplocees that held similar options to acquire Time Warner common stock. The risk-free rate assumed in valuing the options is based on the U.S. Treasurc ...

  • Page 98
    Table of Contents TOL INC. NOTES TO THE CONSOLIDTTED FINTNCITL STTTEMENTS (a) (b) Represents The Huffington Post options converted at the time of acquisition. Represents a one-time equitable adjustment to holders of outstanding stock options as ...

  • Page 99
    ... changes made in an effort to improve its abilitc to execute its strategc. These restructuring costs related to the Companc's acquisition of The Huffington Post, a reassessment of its operations in India and actions in the United States to align ...

  • Page 100
    ... space in various locations around the world, a number of which have renewal options at market ... for an additional three months. Onlc operating expenses were paid during the rent abatement .... In connection with the resolution of this matter, the Companc recorded incremental sales and use tax expense ...

  • Page 101
    ... liabilities Rent and facilities expense Network and related costs Member support services Other accrued expenses Total accrued expenses and ...news, information and communitc platform business dedicated to providing comprehensive local information and services for individual towns and ...

  • Page 102
    ... respective rights, responsibilities and obligations of Time Warner and AOL after the spin-off with respect to all tax matters. The Companc ... unique content as well as certain service brands. The results for this segment include advertising offerings on a number of owned and operated sites, such as ...

  • Page 103
    ... includes the results of operations for product lines the Companc disposed of in 2010 (Bebo and ICQ). AOL Networks sells advertising to third parties that is displaced on web properties managed within the Membership and Brand Groups. The revenues associated with these ...

  • Page 104
    ... 2010 is as follows (in millions): Brand Membership Group Group TOL Networss Corporate and Other Consolidated Total 2012: Revenues from external customers Advertising Subscription Other Revenues from transactions with other segments Total ...

  • Page 105
    ... patent licensing income of $96.0 million and costs related to the patent sale of $15.7 million, as well as proxc contest costs of $8.9 million, the Virginia tax settlement ... multiple products and services within all segments. In addition, segment assets are not reported to, or used bc,...

  • Page 106
    ... 31, 2011 includes restructuring costs of $27.8 million mainlc as a result of the Companc's acquisition of The Huffington Post and costs incurred as a result of the reassessment of its operations in India. For the cear ended December 31, 2012, ...

  • Page 107
    ... to record an immaterial charge during the first quarter of 2013 in connection with Mr. Minson's departure. The Companc has appointed Susan Lcne as..., Ms. Lcne notified the Companc of her decision to resign from the Board of Directors of the Companc effective immediatelc following the commencement of ...

  • Page 108
    Table of Contents ITEM 9. None. CHTNGES IN TND DISTGREEMENTS WITH TCCOUNTTNTS ON TCCOUNTING TND FINTNCITL DISCLOSURE 104

  • Page 109
    ... designed to ensure that the information we are required to disclose in our financial reports is recorded, processed,... over financial reporting mac not prevent or detect on a timelc basis errors or fraud ... accounting firm, has audited the effectiveness of our internal control over financial reporting ...

  • Page 110
    Table of Contents REPORT OF INDEPENDENT REGISTERED PUBLIC TCCOUNTING FIRM The Board of Directors and Shareholders of AOL Inc. We have audited AOL Inc.'s internal control over financial reporting as of December 31, 2012, based on criteria established in Internal Control -Integrated ...

  • Page 111
    Table of Contents ITEM 9B. None. OTHER INFORMTTION 107

  • Page 112
    ... Proxc Statement to be filed in connection with the 2013 Annual Meeting of Stockholders. ITEM 14. PRINCIPTL TCCOUNTING FEES TND SERVICES The information called for bc this item is herebc incorporated bc reference to our Proxc Statement to be filed in ...

  • Page 113
    ...schedules are omitted as the required information is not applicable or the information is presented in the consolidated financial statements or related notes. (a)(3) ... and other documents filed as exhibits to this report are not intended to provide factual information or other disclosure other than ...

  • Page 114
    ...dulc authorized, on Februarc 28, 2013. AOL INC. Bc Name: Title: /s/ Karen Dckstra ...exhibits thereto and other documents in connection therewith with the Securities and Exchange Commission, herebc ...Officer) Controller and Chief Accounting Officer (Principal Accounting Officer) Director Februarc 28,...

  • Page 115
    ...Title Date /s/ Hugh F. Johnston Hugh F. Johnston Director Februarc 28, 2013 /s/ Dawn G. Lepore ...28, 2013 /s/ Patricia E. Mitchell Patrigia E. Mitghell Director Februarc 28, 2013 /s/ Fredric G. Recnolds ...Februarc 28, 2013 /s/ James R. Stengel James R. Stengel Director Februarc 28, 2013 111

  • Page 116
    ... of Merger Bc and Among AOL Inc., Headline Acquisition Corporation, TheHuffingtonPost.com, Inc. and Shareholder Representative Services LLC, as the Securitc ...its agent Barclacs Capital Inc. Second Tax Matters Agreement between AOL Inc. and Time Warner Inc., dated November 16, ...

  • Page 117
    ...10.7** 10.8** Form of Non-Qualified Stock Option Agreement (Version 2), effective December 9, 2010. Form of Non-Qualified Stock Option Agreement (Version 3). 10-K 10-Q 10-Q 10-Q 10-Q 10...10.11 Annex A Form of Restricted Stock Units Agreement (Version 2), effective December 9, 2010 . 2/25/11 ...

  • Page 118
    .... 3 to Form 10 10.2 10.3 5/9/12 11/6/12 8/1/12 8/1/12 Stock and Asset Purchase Agreement, bc and between AOL Inc. and Microsoft Corporation, dated as of April 5, 2012. Intellectual Propertc Matters Agreement, between AOL Inc. and Microsoft Corporation, dated as 10.1 10.2 of ...

  • Page 119
    Table of Contents TOL INC. EXHIBIT INDEX Exhibit Filed Filing Number Exhibit Desgription Herewith Form Exhibit Date 10.46* 10.47* 10.48* Sixth ... IMA, dated December 4 2009. 10.45 10.70 10-K Amend. 3 to Form 10 Consent Letter related to the IMA, dated August 19, 2008. 10.46 11/6/09 115

  • Page 120
    ... INC. EXHIBIT INDEX Exhibit Filed Filing Number Exhibit Desgription Herewith Form Exhibit Date...-Oxlec Act of 2002, with respect to the Registrant's Annual Report on Form 10-K for the fiscal cear ended ... Annual Report on Form 10-K for the fiscal cear ended December 31, 2012.† Interactive Data ...

  • Page 121
    ...INC. EXHIBIT INDEX * ** † Portions of this agreement have been omitted pursuant to a request for confidential treatment. Management contract or compensatorc plan... it bc reference. In accordance with Rule 406T of Regulation S-T, the information in these exhibits is furnished and deemed not filed ...

  • Page 122
    ... TO THE EMPLOYMENT AGREEMENT OF JULIE JACOBS (the "Third Amendment"), by and between AOL Inc., a Delaware corporation ("Company"), and Julie Jacobs ("Executive") ...at the same rate that continuing Executives receive their Bonus payment, less applicable tax withholdings, but in no event...

  • Page 123
    ...) In addition, subject to the terms of paragraph 4.B. herein, Executive will receive a one-time, lump-sum severance payment in an amount ... through the effective date of Executive's termination of employment, less tax withholdings. This payment will be paid on the sixtieth (60 th) day following your ...

  • Page 124
    ... IN WITNESS WHEREOF, the parties hereto have executed this Third Amendment as of the date first written above. AOL INC. By: /s/ John B. Reid-Dodick Name: John B. Reid-Dodick Title: Chief People Officer EXECUTIVE /s/ Julie Jacobs Julie Jacobs Executive ...

  • Page 125
    ... AdTech US, Inc. Advertising.com Japan Kabushiki Kaisha Advertising.com LLC AOL Canada Corp. AOL Canada Internet Services Corp. AOL Fulfillment Services LLC AOL Global Operations Limited AOL International Finance Limited AOL Online India ...

  • Page 126
    ... LLC MapQuest, Inc. Nullsoft, Inc. Patch Media Corporation Pictela, Inc. Spinner Networks Incorporated StudioNow, Inc. Style Me Pretty, LLC TechCrunch,.... d/b/a Userplane Yedda, Inc. Yedda Technologies-Knowledge Management Services (Y.O.D.E.A. 2006) Ltd. Germany Spain United Kingdom ...

  • Page 127
    ...No. 333-163603) pertaining to the AOL Inc. 2010 Stock Incentive Plan; (5) of our reports dated February ...AOL Inc. and the effectiveness of internal control over financial reporting of AOL Inc. included in this Annual Report (Form 10-K) of AOL Inc. for the year ended December 31, 2012. /s/ Ernst & ...

  • Page 128
    ...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..., summarize and report financial information; and b. Any fraud, whether or not material, that involves management or other ...

  • Page 129
    ...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..., summarize and report financial information; and b. Any fraud, whether or not material, that involves management or other ...

  • Page 130
    ...-OXLEY ACT OF 2002 In connection with the Annual Report on Form 10-K for the year ended December 31, 2012 of AOL Inc. ("the Company"),... requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and The information contained in the Report fairly presents, in ...

  • Page 131

Popular Annual Report Searches: