Shutterfly Acquires R&R Images

  Shutterfly Acquires R&R Images

     Acquisition Further Strengthens Premium Printing and Product Design

Business Wire

REDWOOD CITY, Calif. -- August 29, 2013

Shutterfly, Inc. (NASDAQ:SFLY), the leading manufacturer and digital retailer
of high-quality personalized products and services, announced today that it
has acquired R&R Images, a boutique, high variability printer focused on
premium stationery printing and product design. R&R Images is privately-held
and located in Phoenix, Arizona.

Initially, the acquisition will have limited impact on Shutterfly revenue, but
will enhance the company’s enterprise and consumer product innovation, design
and printing capabilities.

“AsShutterfly continues to grow, we are making additional strategic
investments in our manufacturing footprint focused on providing our customers
with innovative, high quality personalized products while efficiently scaling
and managing our costs,” said Jeffrey Housenbold, president and CEO of
Shutterfly. “We are excited to combine R&R Images’ product innovation and
expertise in premium, flexible printing withShutterfly’s manufacturing scale
and infrastructure to enhance our capabilities and continue delighting our
enterprise clients and consumers.”

Inducement Grant Disclosure

In accordance with NASDAQ Listing Rule 5635(c)(4), Shutterfly granted an
inducement grant to Rod Key, R&R Images’ founder. The inducement grant
consists of a restricted stock unit award representing the right to receive up
to 38,492 shares of Shutterfly’s common stock. The award will vest over three
years, with 33 percent of the underlying shares vesting on each of the first,
second, and third anniversaries of the initial August 29, 2013 grant date. The
grant is being made as an inducement material to Mr. Key’s acceptance of
employment with Shutterfly, in accordance with NASDAQ Listing Rule 5635(c)(4).
Vesting of the award is subject to Mr. Key’s continuous service through each
vesting date.

About Shutterfly, Inc.

Shutterfly, Inc. is the leading manufacturer and digital retailer of
high-quality personalized products and services offered through a family of
lifestyle brands. Founded in 1999, the Shutterfly, Inc. family of brands
includes Shutterfly, where your photos come to life in photo books, cards and
gifts; Tiny Prints, premium cards and stationery for all life’s occasions;
Wedding Paper Divas, wedding invitations and stationery for every step of the
planning process; Treat, personalized greeting cards that really stand out;
and MyPublisher, one of the pioneers in the photo book industry and creator of
easy-to-use photo book-making software. For more information about Shutterfly,
Inc. (NASDAQ:SFLY), visit


Shutterfly, Inc.
Michael Look, 650-610-5910
Gretchen Sloan, 650-610-5276
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