-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Re8RupG2mVapowhlKd6RP/azXSh2+eb6HWigL1qWThrjUScJTCaAiRuemtqYatVF Ljq/wsaKfaZm7FuVyRnRoQ== 0001047469-08-010202.txt : 20080922 0001047469-08-010202.hdr.sgml : 20080922 20080922171411 ACCESSION NUMBER: 0001047469-08-010202 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 6 CONFORMED PERIOD OF REPORT: 20080630 FILED AS OF DATE: 20080922 DATE AS OF CHANGE: 20080922 FILER: COMPANY DATA: COMPANY CONFORMED NAME: TICKETMASTER CENTRAL INDEX KEY: 0001006637 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-MISCELLANEOUS AMUSEMENT & RECREATION [7990] IRS NUMBER: 954546874 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-34064 FILM NUMBER: 081082985 BUSINESS ADDRESS: STREET 1: 8800 WEST SUNSET BLVD. CITY: WEST HOLLYWOOD STATE: CA ZIP: 90069 BUSINESS PHONE: 310-360-3300 MAIL ADDRESS: STREET 1: 8800 WEST SUNSET BLVD. CITY: WEST HOLLYWOOD STATE: CA ZIP: 90069 FORMER COMPANY: FORMER CONFORMED NAME: TICKETMASTER ONLINE CITYSEARCH INC DATE OF NAME CHANGE: 19980923 FORMER COMPANY: FORMER CONFORMED NAME: CITYSEARCH INC DATE OF NAME CHANGE: 19980617 FORMER COMPANY: FORMER CONFORMED NAME: PERFECTMARKET INC DATE OF NAME CHANGE: 19960909 10-Q 1 a2187681z10-q.htm FORM 10-Q
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q


ý		QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the Quarterly Period Ended June 30, 2008
or
o		TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to

Commission File No. 001-34064

TICKETMASTER
(Exact name of registrant as specified in its charter)


Delaware (State or other jurisdiction of incorporation or organization)		95-4546874 (I.R.S. Employer Identification No.)
8800 Sunset Blvd., West Hollywood, CA 90069 (Address of Registrant's principal executive offices)
(310) 360-3300 (Registrant's telephone number, including area code)

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 o No ý

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 definition of "accelerated filer," "large accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act. (Check one):


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

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

As of September 18, 2008, the following shares of the Registrant's common stock were outstanding: 56,195,031

EXPLANATORY NOTE

On July 1, 2008, the Board of Directors of IAC/InterActiveCorp, a Delaware corporation ("IAC"), approved a plan to separate IAC into five separate, publicly traded companies via the distribution of all of the outstanding shares of common stock of four wholly-owned subsidiaries, including Ticketmaster, a Delaware corporation ("Ticketmaster" or the "Company"). On August 20, 2008, in connection with the spin-off, IAC distributed to its stockholders all of the outstanding shares of Common Stock, par value $0.01 per share, of Ticketmaster.

Prior to the spin-off, Ticketmaster entered into a Separation and Distribution Agreement and several other agreements with IAC and the other Spincos (as defined below) to effect the separation of the Spincos and provide a framework for the relationships of the Spincos with IAC and each of the other Spincos.

Except as otherwise indicated or unless the context otherwise requires, (i) "IAC/InterActiveCorp" and "IAC" refer to IAC/InterActiveCorp and its consolidated subsidiaries other than, for all periods following the spin-off, HSN, Inc., Interval Leisure Group, Inc., Tree.com, Inc. and Ticketmaster and their respective subsidiaries (the "Spincos"), all of which were spun off from IAC concurrent with the Ticketmaster spin-off, (ii) "Ticketmaster," the "Company," "we," "our" or "us" refers to Ticketmaster, and (iii) "Spin-Off," "spin-off," "separation" or "distribution" refers to the distribution by IAC of the common stock of the Company and the other Spincos.

For further information regarding the presentation of financial information in this Quarterly Report on Form 10-Q, please see Note 1—Basis of Presentation to the combined financial statements.

TICKETMASTER

INDEX


PART I.		FINANCIAL INFORMATION
	Item 1.	Financial Statements		1
			Combined Statements of Operations for the Three and Six Months Ended June 30, 2008 and 2007 (unaudited)	1
			Combined Balance Sheets as of June 30, 2008 (unaudited) and December 31, 2007	2
			Combined Statement of Invested Equity as of June 30, 2008 (unaudited) and December 31, 2007	3
			Combined Statements of Cash Flows for the Six Months ended June 30, 2008 and 2007 (unaudited)	4
			Notes to Unaudited Combined Financial Statements	5
	Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations		15
	Item 3.	Quantitative and Qualitative Disclosures About Market Risk		28
	Item 4T.	Controls and Procedures		28
PART II.		OTHER INFORMATION
	Item 1.	Legal Proceedings		29
	Item 1A.	Risk Factors		29
	Item 6.	Exhibits		29
SIGNATURES				30

PART 1—FINANCIAL STATEMENTS

Item 1. Combined Financial Statements

TICKETMASTER AND SUBSIDIARIES

COMBINED STATEMENTS OF OPERATIONS

(Unaudited)

		Three Months Ended June 30,						Six Months Ended June 30,

		2008			2007			2008			2007
		(In thousands)
Service revenue		$	378,945		$	288,210		$	723,762		$	588,757
Interest on funds held for clients			3,424			5,206			7,588			8,236

	Total revenue		382,369			293,416			731,350			596,993
Cost of sales (exclusive of depreciation shown separately below)			248,549			183,860			469,571			368,644

	Gross profit		133,820			109,556			261,779			228,349
Selling and marketing expense			24,636			8,158			44,029			15,231
General and administrative expense			45,644			39,892			87,497			74,150
Amortization of intangibles			11,535			6,667			20,403			13,520
Depreciation			11,828			9,471			22,883			18,592

	Operating income		40,177			45,368			86,967			106,856
Other income (expense):
	Interest income		1,430			8,499			3,022			13,877
	Interest expense		(6,868	)		(133	)		(5,905	)		(399	)
	Equity in (losses) income of uncombined affiliates		(1,468	)		960			(802	)		1,825
	Other (expense) income		(287	)		(208	)		657			(125	)

Total other (expense) income, net			(7,193	)		9,118			(3,028	)		15,178

Earnings before income taxes and minority interest			32,984			54,486			83,939			122,034
Income tax provision			(10,854	)		(19,873	)		(29,675	)		(44,510	)
Minority interest in losses of combined subsidiaries			882			191			1,455			205

Net income		$	23,012		$	34,804		$	55,719		$	77,729

The accompanying Notes to Unaudited Combined Financial Statements are an integral part of these statements.

TICKETMASTER AND SUBSIDIARIES

COMBINED BALANCE SHEETS

		June 30, 2008			December 31, 2007

		(unaudited)			(audited)
		(In thousands)
ASSETS
Cash and cash equivalents		$	520,795		$	568,417
Restricted cash			—			853
Marketable securities			4,133			—
Accounts receivable, client accounts			112,658			99,453
Accounts receivable, trade, net of allowance of $7,140 and $2,346, respectively			44,035			33,979
Deferred income taxes			8,064			5,883
Contract advances			54,915			63,126
Prepaid expenses and other current assets			40,317			21,149

	Total current assets		784,917			792,860
Property and equipment, net			112,434			95,122
Goodwill			1,389,179			1,090,418
Intangible assets, net			224,635			92,325
Long-term investments			126,980			149,295
Other non-current assets			95,890			86,514

TOTAL ASSETS		$	2,734,035		$	2,306,534

LIABILITIES AND INVESTED EQUITY
LIABILITIES:
Accounts payable, client accounts		$	478,003		$	413,075
Accounts payable, trade			19,199			14,698
Accrued compensation and benefits			28,355			31,171
Deferred revenue			31,278			19,829
Income taxes payable			1,565			1,721
Other accrued expenses and current liabilities			41,156			42,449

	Total current liabilities		599,556			522,943
Income taxes payable			1,022			982
Other long-term liabilities			7,266			3,204
Deferred income taxes			66,245			32,416
Minority interest			7,331			7,812
Commitments and contingencies
INVESTED EQUITY:
Invested capital			2,604,162			2,172,497
Receivables from IAC and subsidiaries			(606,947	)		(474,110	)
Accumulated other comprehensive income			55,400			40,790

	Total invested equity		2,052,615			1,739,177

TOTAL LIABILITIES AND INVESTED EQUITY		$	2,734,035		$	2,306,534

The accompanying Notes to Unaudited Combined Financial Statements are an integral part of these statements.

TICKETMASTER AND SUBSIDIARIES

COMBINED STATEMENT OF INVESTED EQUITY

(Unaudited)

		Total			Invested Capital		Receivables from IAC and Subsidiaries			Accumulated Other Comprehensive Income

		(In thousands)
Balance as of December 31, 2007		$	1,739,177		$	2,172,497	$	(474,110	)	$	40,790
Comprehensive income:
	Net income for the six months ended June 30, 2008		55,719			55,719		—			—
	Foreign currency translation		14,610			—		—			14,610

Comprehensive income			70,329
Net transfers from IAC (principally funding for acquisitions)			375,946			375,946		—			—
Net change in receivables from IAC and subsidiaries			(132,837	)		—		(132,837	)		—

Balance as of June 30, 2008		$	2,052,615		$	2,604,162	$	(606,947	)	$	55,400

The accompanying Notes to Unaudited Combined Financial Statements are an integral part of these statements.

TICKETMASTER AND SUBSIDIARIES

COMBINED STATEMENTS OF CASH FLOWS

(Unaudited)

		Six Months Ended June 30,

		2008			2007
		(In thousands)
Cash flows from operating activities:
Net income		$	55,719		$	77,729
Adjustments to reconcile net income to net cash provided by operating activities:
	Amortization of intangibles		20,403			13,520
	Depreciation		22,883			18,592
	Non-cash compensation expense		11,393			4,942
	Deferred income taxes		(2,703	)		(5,606	)
	Equity in losses (income) of uncombined affiliates, net of dividends		4,290			3,529
	Minority interest in losses of combined subsidiaries		(1,455	)		(205	)
Changes in current assets and liabilities:
	Accounts receivable		(5,282	)		(2,126	)
	Prepaid expenses and other current assets		(12,020	)		(2,529	)
	Accounts payable and other current liabilities		(31,242	)		(13,143	)
	Income taxes payable		(5,442	)		(1,799	)
	Deferred revenue		5,652			282
	Funds collected on behalf of clients, net		42,530			32,347
Other, net			3,988			495

Net cash provided by operating activities			108,714			126,028

Cash flows from investing activities:
	Transfers (to) from IAC		(141,914	)		17,256
	Acquisitions, net of cash acquired		(393,545	)		(31,260	)
	Capital expenditures		(23,240	)		(21,361	)
	Purchase of marketable securities		(4,176	)		—
	Increase in long-term investments		(257	)		(77	)

Net cash used in investing activities			(563,132	)		(35,442	)

Cash flows from financing activities:
	Capital contributions from IAC		393,545			31,260
	Principal payments on long-term obligations		(929	)		(1,582	)
	Excess tax benefits from stock-based awards		53			2,489

Net cash provided by financing activities			392,669			32,167

Effect of exchange rate changes on cash and cash equivalents			14,127			11,346

Net (decrease) increase in cash and cash equivalents			(47,622	)		134,099
Cash and cash equivalents at beginning of period			568,417			317,577

Cash and cash equivalents at end of period		$	520,795		$	451,676

The accompanying Notes to Unaudited Combined Financial Statements are an integral part of these statements.

TICKETMASTER AND SUBSIDIARIES

NOTES TO UNAUDITED COMBINED FINANCIAL STATEMENTS

NOTE 1—ORGANIZATION AND BASIS OF PRESENTATION

Spin-Off

On August 20, 2008, IAC/InterActiveCorp ("IAC") distributed (the "spin-off") to its stockholders all of the outstanding shares of common stock, par value $0.01 per share, of Ticketmaster. Ticketmaster's businesses include the businesses that formerly comprised IAC's Ticketmaster segment, which consists of its domestic and international ticketing and ticketing related businesses, subsidiaries and investments, excluding its ReserveAmerica subsidiary and its investment in Active.com. Ticketmaster includes IAC's investment in Front Line Management Group, Inc. ("Front Line"). We refer to our businesses as the "Ticketmaster Businesses."

Basis of Presentation

The historical combined financial statements of Ticketmaster and its subsidiaries reflect the historical financial position, results of operations and cash flows of the Ticketmaster Businesses since their respective dates of acquisition by IAC, and the allocation to Ticketmaster of certain IAC corporate expenses relating to the Ticketmaster Businesses based on the historical consolidated financial statements and accounting records of IAC and using the historical results of operations and historical bases of the assets and liabilities of the Ticketmaster Businesses. However, for the purposes of these financial statements, income taxes have been computed for Ticketmaster on an as if stand-alone, separate tax return basis. These financial statements are prepared on a combined, rather than a consolidated, basis because they exclude ReserveAmerica and the investment in Active.com that were owned, and include the investment in Front Line that was not owned, either directly or indirectly, prior to the spin-off by legal entities that comprise the Ticketmaster Businesses. The ownership of ReserveAmerica and the investment in Active.com were retained by IAC after the spin-off. These combined financial statements present IAC's and its subsidiaries net investment in the Ticketmaster Businesses as invested equity in lieu of shareholders' equity. Intercompany transactions and accounts have been eliminated.

In the opinion of Ticketmaster's management, the assumptions underlying the historical combined financial statements of Ticketmaster are reasonable. However, this financial information does not necessarily reflect what the historical financial position, results of operations and cash flows of Ticketmaster would have been had Ticketmaster been a stand-alone company during the periods presented.

The accompanying unaudited combined financial statements have been prepared in accordance with U.S. generally accepted accounting principles for interim financial information and with the rules and regulations of the Securities and Exchange Commission. Accordingly, they do not include all of the information and notes required by U.S. generally accepted accounting principles for complete financial statements. In the opinion of Ticketmaster's management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Interim results are not necessarily indicative of the results that may be expected for a full year. The accompanying unaudited combined financial statements should be read in conjunction with Ticketmaster's audited combined financial statements and notes thereto for the year ended December 31, 2007.

Company Overview

Ticketmaster is the world's leading live entertainment ticketing and marketing company, providing ticket sales, ticket resale services, marketing and distribution through www.ticketmaster.com, one of the

TICKETMASTER AND SUBSIDIARIES

NOTES TO UNAUDITED COMBINED FINANCIAL STATEMENTS (Continued)

NOTE 1—ORGANIZATION AND BASIS OF PRESENTATION (Continued)

largest e-commerce sites on the internet, approximately 6,700 independent sales outlets and 19 call centers worldwide. Ticketmaster serves leading arenas, stadiums, amphitheaters, music clubs, concert promoters, professional sports franchises and leagues, college sports teams, performing arts venues, museums and theaters in the United States and abroad, including Australia, Canada, China, Denmark, Finland, Germany, Ireland, the Netherlands, New Zealand, Norway, Spain, Sweden, Turkey and the United Kingdom. Ticketmaster is also a party to joint ventures with third parties to provide ticket distribution services in Mexico and to supply ticketing services for the 2008 Beijing Olympic Games. Ticketmaster licenses its technology in Mexico, Argentina, Brazil, Chile, China and Belgium.

NOTE 2—SIGNIFICANT ACCOUNTING POLICIES

Accounting Estimates

Ticketmaster's management is required to make certain estimates and assumptions during the preparation of its combined financial statements in accordance with U.S. generally accepted accounting principles. These estimates and assumptions impact the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities as of the date of the combined financial statements. They also impact the reported amount of net earnings during any period. Actual results could differ from those estimates.

Significant estimates underlying the accompanying combined financial statements include: the recoverability of contract advances; the recoverability of long-lived assets; the recovery of goodwill and intangible assets; the determination of income taxes payable and deferred income taxes, including related valuation allowances; and assumptions related to the determination of stock-based compensation.

Recent Accounting Pronouncements

In September 2006, the FASB issued SFAS No. 157, "Fair Value Measurements" ("SFAS 157"). SFAS 157 does not require new fair value measurements but rather defines fair value, establishes a framework for measuring fair value and expands disclosure of fair value measurements. Ticketmaster adopted SFAS 157 on January 1, 2008 for financial assets and liabilities. Adoption of FAS 157 with respect to financial assets and liabilities did not have a material impact on Ticketmaster's combined financial position and results of operations. As of June 30, 2008, Ticketmaster's financial assets consisted of cash and marketable securities which are measured at fair value using quoted prices for identical assets in an active market (Level 1 fair value hierarchy) in accordance with SFAS 157.

In February 2008, the FASB issued FSP FAS 157-2, Effective date of FASB Statement No. 157 (FSP FAS 157-2), which permits a one-year deferral of the application of SFAS No. 157 for all non-financial assets and non-financial liabilities, except those that are recognized or disclosed at fair value in the financial statements on a recurring basis (at least annually). The Company will adopt SFAS No. 157 for non-financial assets and non-financial liabilities on January 1, 2009 and does not expect the provisions to have a material effect on its results of operations, financial position or cash flows.

In February 2007, the FASB issued SFAS No. 159, "The Fair Value Option for Financial Assets and Liabilities, including an amendment of FASB Statement No. 115." SFAS 159 allows companies to elect fair-value measurement when an eligible financial asset or financial liability is initially recognized or when an event, such as a business combination, triggers a new basis of accounting for that financial

TICKETMASTER AND SUBSIDIARIES

NOTES TO UNAUDITED COMBINED FINANCIAL STATEMENTS (Continued)

NOTE 2—SIGNIFICANT ACCOUNTING POLICIES (Continued)

asset or financial liability. SFAS 159 became effective for Ticketmaster on January 1, 2008, however, Ticketmaster did not elect the fair value measurement provision for any of our financial assets or liabilities, and as a result the adoption of SFAS 159 had no effect on Ticketmaster's combined financial position or results of operations.

In December 2007, the Financial Accounting Standards Board ("FASB") issued SFAS No. 160, "Noncontrolling Interests in Consolidated Financial Statements—an amendment of Accounting Research Bulletin No. 51" ("SFAS No. 160"). SFAS No. 160 establishes accounting and reporting standards for ownership interests in subsidiaries held by parties other than the parent, the amount of combined net income attributable to the parent and to the noncontrolling interest, changes in a parent's ownership interest and the valuation of retained noncontrolling equity investments when a subsidiary is deconsolidated. The Statement also establishes reporting requirements that provide sufficient disclosures that clearly identify and distinguish between the interests of the parent and the interests of the noncontrolling owners. SFAS No. 160 is effective for fiscal years beginning after December 15, 2008. SFAS No. 160 will be applied prospectively, except as it relates to disclosures, for which the effects will be applied retrospectively for all periods presented. Early adoption is not permitted. Ticketmaster is currently assessing the impact of SFAS No. 160 on its combined financial position, results of operations and cash flows.

In December 2007, the FASB issued SFAS No. 141 (revised 2007), "Business Combinations" ("SFAS No. 141R"), which replaces FASB Statement No. 141. SFAS No. 141R establishes principles and requirements for how an acquirer recognizes and measures in its financial statements the identifiable assets acquired, the liabilities assumed, any noncontrolling interest in the acquiree and the goodwill acquired. The Statement also establishes disclosure requirements that will enable users to evaluate the nature and financial effects of the business combination. SFAS No. 141R applies prospectively to business combinations in fiscal years beginning after December 15, 2008. Early adoption is not permitted. Ticketmaster is currently assessing the impact of the adoption of SFAS No. 141R on its combined financial position, results of operations and cash flows.

NOTE 3—GOODWILL AND INTANGIBLE ASSETS

The balance of goodwill and intangible assets, net is as follows (in thousands):

		June 30, 2008		December 31, 2007

Goodwill		$	1,389,179	$	1,090,418
Intangible assets with indefinite lives			62,585		62,560
Intangible assets with definite lives, net			162,050		29,765

	Total goodwill and intangible assets, net	$	1,613,814	$	1,182,743

TICKETMASTER AND SUBSIDIARIES

NOTES TO UNAUDITED COMBINED FINANCIAL STATEMENTS (Continued)

NOTE 3—GOODWILL AND INTANGIBLE ASSETS (Continued)

Intangible assets with indefinite lives relate principally to trade names and trademarks acquired in various acquisitions. At June 30, 2008, intangible assets with definite lives relate to the following (in thousands):

		Cost		Accumulated Amortization			Net

Purchase agreements		$	166,301	$	(156,386	)	$	9,915	6.0
Broker relationships			63,800		(1,772	)		62,028	12.0
Customer lists			34,600		(2,503	)		32,097	7.0
Technology			32,815		(11,215	)		21,600	3.4
Distribution agreements			28,903		(23,245	)		5,658	4.3
Other			44,792		(14,040	)		30,752	7.3

	Total	$	371,211	$	(209,161	)	$	162,050

At December 31, 2007, intangible assets with definite lives relate to the following (in thousands):

		Cost		Accumulated Amortization			Net

Purchase agreements		$	163,681	$	(145,637	)	$	18,044	6.1
Distribution agreements			28,109		(20,567	)		7,542	4.2
Technology			8,587		(8,397	)		190	4.0
Other			14,752		(10,763	)		3,989	5.2

	Total	$	215,129	$	(185,364	)	$	29,765

Amortization of intangible assets with definite lives is computed on a straight-line basis and, based on June 30, 2008 balances, such amortization for the remainder of 2008 and each of the next five years and thereafter is estimated to be as follows (in thousands):


Remaining six months of 2008	$	16,656
2009		28,710
2010		23,977
2011		15,513
2012		12,765
2013		12,051
2014 and thereafter		52,378

	$	162,050

The following table presents the balance of goodwill, including changes in the carrying amount of goodwill, for the six months ended June 30, 2008 (in thousands):

Balance As of January 1, 2008		Additions		(Deductions)			Foreign Exchange Translation		Balance As of June 30, 2008

$	1,090,418	$	293,760	$	(14	)	$	5,015	$	1,389,179

TICKETMASTER AND SUBSIDIARIES

NOTES TO UNAUDITED COMBINED FINANCIAL STATEMENTS (Continued)

NOTE 3—GOODWILL AND INTANGIBLE ASSETS (Continued)

Additions principally relate to the acquisitions of TicketsNow, Paciolan, and GET ME IN! LTD. The aggregate purchase price for these acquisitions totaled approximately $425 million. Ticketmaster identified approximately $151.5 million of intangible assets other than goodwill. The goodwill recognized amounted to approximately $289.3 million. The purchase price allocation for each of these acquisitions is preliminary and subject to adjustment during the allocation period, which is not expected to last beyond a year from the respective date of purchase, and as such the goodwill may change.

NOTE 4—PROPERTY AND EQUIPMENT

The balance of property and equipment, net is as follows (in thousands):

		June 30, 2008			December 31, 2007

Computer equipment and capitalized software		$	293,661		$	260,983
Leasehold improvements			17,460			14,180
Furniture and other equipment			21,168			18,375
Projects in progress			12,589			10,249
Land			2,471			2,500

			347,349			306,287
Less: accumulated depreciation and amortization			(234,915	)		(211,165	)

	Total property and equipment, net	$	112,434		$	95,122

NOTE 5—SEGMENT INFORMATION

Ticketmaster has one operating segment based upon how the chief operating decision maker and executive management view the business, its organizational structure and the type of service provided, which primarily is online and offline ticketing services.

Ticketmaster's primary metric is Operating Income Before Amortization, which is defined as operating income excluding, if applicable: (1) non-cash compensation expense, (2) amortization and impairment of intangibles, (3) goodwill impairment, (4) pro forma adjustments for significant acquisitions, and (5) one-time items. Ticketmaster believes this measure is useful to investors because it represents its combined operating results taking into account depreciation, which it believes is an ongoing cost of doing business, but excluding the effects of any other non-cash expenses. Operating Income Before Amortization has certain limitations in that it does not take into account the impact to Ticketmaster's statement of operations of certain expenses, including non-cash compensation and acquisition-related accounting.

TICKETMASTER AND SUBSIDIARIES

NOTES TO UNAUDITED COMBINED FINANCIAL STATEMENTS (Continued)

NOTE 5—SEGMENT INFORMATION (Continued)

The following table reconciles Operating Income Before Amortization to operating income and net income (in thousands):

		Three Months Ended June 30,						Six Months Ended June 30,

		2008			2007			2008			2007
Operating Income Before Amortization		$	58,340		$	55,098		$	118,763		$	125,318
Non-cash compensation expense			(6,628	)		(3,063	)		(11,393	)		(4,942	)
Amortization of intangibles			(11,535	)		(6,667	)		(20,403	)		(13,520	)

	Operating income		40,177			45,368			86,967			106,856
Interest income			1,430			8,499			3,022			13,877
Interest expense			(6,868	)		(133	)		(5,905	)		(399	)
Equity in (losses) income of uncombined affiliates			(1,468	)		960			(802	)		1,825
Other (expense) income			(287	)		(208	)		657			(125	)
Income tax provision			(10,854	)		(19,873	)		(29,675	)		(44,510	)
Minority interest in losses of combined subsidiaries			882			191			1,455			205

Net income		$	23,012		$	34,804		$	55,719		$	77,729

Non-cash compensation expense in the table above is included in the following line items in the accompanying combined statements of operations for the three and six months ended June 30, 2008 and 2007 (in thousands):

	Three Months Ended June 30,				Six Months Ended June 30,

	2008		2007		2008		2007
Cost of sales	$	303	$	242	$	538	$	390
Selling and marketing expense		330		265		588		428
General and administrative expense		5,995		2,556		10,267		4,124

Non-cash compensation expense	$	6,628	$	3,063	$	11,393	$	4,942

Ticketmaster maintains operations in the United States, the United Kingdom, Canada and other international territories. Geographic information about the United States and international territories is presented below (in thousands):

		Three Months Ended June 30,				Six Months Ended June 30,

		2008		2007		2008		2007
Revenue:
	United States	$	261,553	$	200,137	$	501,260	$	409,214
	All other countries		120,816		93,279		230,090		187,779

	Total	$	382,369	$	293,416	$	731,350	$	596,993

TICKETMASTER AND SUBSIDIARIES

NOTES TO UNAUDITED COMBINED FINANCIAL STATEMENTS (Continued)

NOTE 5—SEGMENT INFORMATION (Continued)

		June 30, 2008		December 31, 2007

Long-lived assets (excluding goodwill and intangible assets):
	United States	$	81,383	$	63,021
	All other countries		31,051		32,101

	Total	$	112,434	$	95,122

NOTE 6—EQUITY INVESTMENTS IN UNCOMBINED AFFILIATES

At June 30, 2008 and December 31, 2007, Ticketmaster's equity investments in uncombined affiliates totaled $122.6 million and $145.2 million, respectively, and are included in "Long-term investments" in the accompanying combined balance sheets. On June 9, 2008 IAC sold a portion of its investment in Front Line to Madison Square Garden, L.P. at the same per share price that IAC paid to acquire its investment in Front Line.

Summarized aggregated financial information for Ticketmaster's equity investments is as follows (in thousands):

	Six Months Ended June 30,

	2008		2007
Net sales	$	112,198	$	67,011
Gross profit		54,638		42,239
Net income		2,200		5,173

NOTE 7—COMPREHENSIVE INCOME

Comprehensive income is comprised of (in thousands):

	Three Months Ended June 30,				Six Months Ended June 30,

	2008		2007		2008		2007
Net income	$	23,012	$	34,804	$	55,719	$	77,729
Foreign currency translation		2,326		5,847		14,610		8,459

Comprehensive income	$	25,338	$	40,651	$	70,329	$	86,188

Accumulated other comprehensive income for the three and six months ended June 30, 2008 and June 30, 2007 is solely related to foreign currency translation.

NOTE 8—INCOME TAXES

Ticketmaster calculates its interim income tax provision in accordance with Accounting Principles Board Opinion No. 28 and FASB Interpretation No. 18. At the end of each interim period, Ticketmaster makes its best estimate of the annual expected effective tax rate and applies that rate to its ordinary year-to-date earnings or loss. The tax or benefit related to significant, unusual, or extraordinary items that will be separately reported or reported net of their related tax effect are individually computed and recognized in the interim period in which those items occur. In addition, the effect of changes in enacted tax laws or rates, tax status, or judgment on the realizability of a

TICKETMASTER AND SUBSIDIARIES

NOTES TO UNAUDITED COMBINED FINANCIAL STATEMENTS (Continued)

NOTE 8—INCOME TAXES (Continued)

beginning-of-the-year deferred tax asset in future years is recognized in the interim period in which the change occurs.

The computation of the annual expected effective tax rate at each interim period requires certain estimates and assumptions including, but not limited to, the expected operating income for the year, projections of the proportion of income (or loss) earned and taxed in foreign jurisdictions, permanent and temporary differences, and the likelihood of recovering deferred tax assets generated in the current year. The accounting estimates used to compute the provision for income taxes may change as new events occur, more experience is acquired, additional information is obtained or our tax environment changes. To the extent that the estimated annual effective tax rate changes during a quarter, the effect of the change on prior quarters is included in tax expense for the current quarter. Included in the income tax provision for the three months ended June 30, 2008 is a benefit of $0.4 million due to a change in the estimated annual effective tax rate from that used in the first quarter.

For the three and six months ended June 30, 2008, Ticketmaster recorded a tax provision of $10.9 million and $29.7 million, respectively, which represent effective tax rates of 33% and 35%, respectively. The tax rate for the three months ended June 30, 2008 is lower than the federal statutory rate of 35% due principally to foreign income taxed at lower rates and tax benefit related to foreign dividends, partially offset by state and local income taxes. The tax rate for the six months ended June 30, 2008 approximates the federal statutory rate of 35% principally due to state and local income taxes, offset by foreign income taxed at lower rates and foreign tax credits from foreign dividends.

For the three and six months ended June 30, 2007, Ticketmaster recorded a tax provision of $19.9 million and $44.5 million, respectively, representing an effective tax rate of 36%. The tax rate for the three and six months ended June 30, 2007 is higher than the federal statutory rate of 35% due principally to state and local income taxes.

As of December 31, 2007 and June 30, 2008, Ticketmaster had unrecognized tax benefits of approximately $5.5 million. Included in unrecognized tax benefits at June 30, 2008 is approximately $4.6 million for tax positions included in IAC's consolidated tax return filings that will remain a liability of IAC after the spin-off. Ticketmaster recognizes interest and, if applicable, penalties related to unrecognized tax benefits in income tax expense. Included in income tax expense for the three and six months ended June 30, 2008 is $0.1 million and $0.2 million, net of related deferred taxes, for interest on unrecognized tax benefits. At June 30, 2008, Ticketmaster has accrued $1.1 million for the payment of interest. There are no material accruals for penalties.

The IRS is currently examining the IAC consolidated tax returns for the years ended December 31, 2001 through 2003, which includes the operations of Ticketmaster from January 17, 2003, the date which Ticketmaster joined the IAC consolidated tax return. The statute of limitations for these

TICKETMASTER AND SUBSIDIARIES

NOTES TO UNAUDITED COMBINED FINANCIAL STATEMENTS (Continued)

NOTE 8—INCOME TAXES (Continued)

years has been extended to December 31, 2009. Various IAC consolidated state, local and foreign jurisdictions are currently under examination, the most significant of which are California, Florida, New York state and New York City, for various tax years after December 31, 2001. These examinations are expected to be completed by late 2008.

Ticketmaster believes that it is reasonably possible that its unrecognized tax benefits could decrease by approximately $3.6 million within twelve months of the current reporting date due to the reversal of deductible temporary differences which will result in a corresponding increase in net deferred tax liabilities. An estimate of other changes in unrecognized tax benefits cannot be made, but are not expected to be significant.

NOTE 9—CONTINGENCIES

In the ordinary course of business, Ticketmaster is a party to various lawsuits. Ticketmaster establishes reserves for specific legal matters when it determines that the likelihood of an unfavorable outcome is probable and the loss is reasonably estimable. Management has also identified certain other legal matters where it believes an unfavorable outcome is not probable and, therefore, no reserve is established. Although management currently believes that an unfavorable resolution of claims against Ticketmaster, including claims where an unfavorable outcome is reasonably possible, will not have a material impact on the liquidity, results of operations, or financial condition of Ticketmaster, these matters are subject to inherent uncertainties and management's view of these matters may change in the future. It is possible that an unfavorable outcome of one or more of these lawsuits could have a material impact on the liquidity, results of operations, or financial condition of Ticketmaster. Ticketmaster also evaluates other contingent matters, including tax contingencies, to assess the probability and estimated extent of potential loss. See Note 8 for discussion related to income tax contingencies.

NOTE 10—RELATED PARTY TRANSACTIONS

Ticketmaster's expenses include allocations from IAC of costs associated with IAC's accounting, treasury, legal, tax, corporate support, human resources and internal audit functions. These expenses were allocated based on the ratio of Ticketmaster's revenue as a percentage of IAC's total revenue. Allocated costs were $0.8 million and $0.7 million for the three months ended June 30, 2008 and 2007, respectively, and $1.8 million and $1.5 million for the six months ended June 30, 2008 and 2007, respectively, and are included in "General and administrative expense" in the accompanying combined statements of operations. It is not practicable to determine the amounts of these expenses that would have been incurred had Ticketmaster operated as an unaffiliated entity. In the opinion of management, the allocation method is reasonable.

The portion of interest expense reflected in the combined statements of operations that is intercompany in nature was $6.3 millions and $4.6 million for the three and six months ended June 30, 2008, respectively. The portion of interest income reflected in the combined statements of operations that is intercompany in nature was $7.6 million and $12.2 million for the three and six months ended June 30, 2007, respectively. This intercompany interest relates to the receivables from IAC.

TICKETMASTER AND SUBSIDIARIES

NOTES TO UNAUDITED COMBINED FINANCIAL STATEMENTS (Continued)

NOTE 10—RELATED PARTY TRANSACTIONS (Continued)

An analysis of Ticketmaster's receivables from IAC and subsidiaries is as follows (in thousands):

	June 30, 2008

Receivables from IAC and subsidiaries at December 31, 2007	$	474,110
Cash transfers from IAC related to its centrally managed U.S. treasury function		170,905
Interest expense		(4,587	)
Employee equity instruments and associated tax withholdings		4,053
Taxes (excludes tax withholdings associated with employee equity instruments)		(23,601	)
Allocation of non-cash compensation expense		(6,800	)
Administrative expenses and other		(7,133	)

Receivables from IAC and subsidiaries at June 30, 2008	$	606,947

Relationship Between IAC and Ticketmaster after the Spin-Off

For purposes of governing certain of the ongoing relationships between Ticketmaster and IAC at and after the spin-off, and to provide for an orderly transition, Ticketmaster and IAC entered into a separation agreement, a tax sharing agreement, an employee matters agreement and a transition services agreement, among other agreements.

NOTE 11—SUBSEQUENT EVENTS

In connection with the Spin-Off, Ticketmaster distributed approximately $726 million in cash to IAC on August 20, 2008. This distribution was funded in part through borrowings of $100 million and $350 million of Term Loan A and B loans, respectively , pursuant to the Credit Agreement entered into by Ticketmaster and certain of its subsidiaries on July 25, 2008 (the "Credit Agreement"). On August 20, 2008, each of Ticketmaster's direct and indirect domestic subsidiaries became a party to the Credit Agreement as a guarantor of Ticketmaster's obligations and pledged certain of its assets as security for those obligations. Ticketmaster has borrowed $15 million of revolving loans pursuant to the revolving portion of the Credit Agreement.

The remainder of the $726 million distribution was funded by the net proceeds from Ticketmaster's private placement of $300 million aggregate principal amount of 10.75% senior unsecured notes due 2016 (the "Ticketmaster Notes") issued pursuant to an Indenture between Ticketmaster and The Bank of New York Mellon on July 28, 2008 (the "Indenture"). On August 20, 2008, a subsidiary that was transferred to Ticketmaster in connection with the pre-Spin-Off restructuring became a guarantor of Ticketmaster's obligations under the Ticketmaster Notes pursuant to a Supplemental Indenture to the Indenture. Interest on the Ticketmaster Notes is payable semi-annually in cash in arrears on August 1 and February 1 of each year, commencing February 1, 2009.

Also in connection with the Spin-off, on August 20, 2008 the Ticketmaster Board of Directors and IAC, in its capacity as sole stockholder of Ticketmaster, approved both the Ticketmaster Deferred Compensation Plan for Non-Employee Directors and the Ticketmaster 2008 Stock and Annual Incentive Plan (the "2008 Incentive Plan"), each of which became effective on that date. As a result, non-employee members of Ticketmaster's Board of Directors were each awarded 4,621 Ticketmaster restricted stock units under the 2008 Incentive Plan.

Item 2. Management's Discussion and Analysis of the Financial Condition and Results of Operations

GENERAL

Forward-Looking Statements

Forward-looking statements in this Quarterly Report are subject to known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements or other public statements. Forward-looking statements include the information regarding future financial performance, business prospects and strategy, including the realization of anticipated benefits related to the spin-offs, as well as anticipated financial position, liquidity and capital needs and other similar matters, in each case relating to the Company.

Statements preceded by, followed by or that otherwise include the words "believes," "expects," "anticipates," "intends," "projects," "estimates," "plans," "may increase," "may fluctuate," and similar expressions or future or conditional verbs such as "will," "should," "would," "may" and "could" are generally forward-looking in nature and not historical facts. You should understand that the following important factors could affect future results and could cause actual results to differ materially from those expressed in such forward-looking statements:

•

adverse changes in economic conditions generally or in any of the markets or industries in which the businesses of the Company operate;

•

changes in senior management at the Company;

•

adverse changes to, or interruptions in, relationships with third parties;

•

changes affecting the ability of the Company to efficiently maintain and grow the market share of its various brands, as well as to extend the reach of these brands through a variety of distribution channels and to attract new (and retain existing) customers;

•

consumer acceptance of new products and services offered by the Company;

•

the rates of growth of the Internet and the e-commerce industry;

•

changes adversely affecting the ability of the Company to adequately expand the reach of its businesses into various international markets, as well as to successfully manage risks specific to international operations and acquisitions, including the successful integration of acquired businesses;

•

future regulatory and legislative actions and conditions affecting the Company, including:

•: the promulgation of new, and/or the amendment of existing laws, rules and regulations applicable to the Company and its businesses; and
•: changes in the application or interpretation of existing laws, rules and regulations in the case of the businesses of the Company. In each case, laws, rules and regulations include, among others, those relating to sales, use, value-added and other taxes, software programs, consumer protection and privacy, intellectual property, the Internet and e-commerce;

•

competition from other companies;

•

changes adversely affecting the ability of the Company and its businesses to adequately protect intellectual property rights, as well as to obtain licenses or other rights with respect to intellectual property in the future, which may or may not be available on favorable terms (if at all);

•

the substantial indebtedness of the Company and the possibility that the Company may incur additional indebtedness;

•: third-party claims alleging infringement of intellectual property rights by the Company or its businesses, which could result in the expenditure of significant financial and managerial resources, injunctions or the imposition of damages, as well as the need to enter into formal licensing or other similar arrangements with such third parties, which may or may not be available on favorable terms (if at all); and
•: natural disasters, acts of terrorism, war or political instability.

Certain of these factors and other factors, risks and uncertainties are discussed in the "Risk Factors" section of the Company's Post-Effective Amendment No. 1 to Form S-1 filed with the SEC on August 20, 2008, which is attached as Exhibit 99.2 hereto. Other unknown or unpredictable factors may also cause actual results to differ materially from those projected by the forward-looking statements. Most of these factors are difficult to anticipate and are generally beyond the control of the Company.

You should consider the areas of risk described above, as well as those set forth in the "Risk Factors" section of the Company's Post-Effective Amendment No. 1 to Form S-1 filed with the SEC on August 20, 2008, which is attached as Exhibit 99.2 hereto, in connection with considering any forward-looking statements that may be made by the Company generally. Except for the ongoing obligations of the Company to disclose material information under the federal securities laws, the Company does not undertake any obligation to release publicly any revisions to any forward-looking statements, to report events or to report the occurrence of unanticipated events unless required to do so by law.

Management Overview

On August 20, 2008, IAC/InterActiveCorp ("IAC") distributed (the "spin-off") to its stockholders all of the outstanding shares of common stock, par value $0.01 per share, of Ticketmaster. Our businesses include the businesses that formerly comprised IAC's Ticketmaster segment, which consists of its domestic and international ticketing and ticketing related businesses, subsidiaries and investments, excluding its ReserveAmerica subsidiary and its investment in Active.com. Ticketmaster includes IAC's investment in Front Line Management Group, Inc. ("Front Line"). We refer to our businesses as the "Ticketmaster Businesses."

Results of operations for the three and six months ended June 30, 2008 compared to the three and six months ended June 30, 2007:

Revenue

For the three months ended June 30, 2008 compared to the three months ended June 30, 2007

	Three Months Ended June 30,

	2008		% Change	2007
	(Dollars in thousands)
Domestic	$	261,553	31%	$	200,137
International		120,816	30%		93,279

Total revenue	$	382,369	30%	$	293,416

Revenue in 2008 increased $89.0 million, or 30%, from 2007 driven by increases in both domestic and international revenue as worldwide tickets sold increased 7%, with a 10% increase in average revenue per ticket. Domestic revenue grew by 31%, primarily due to a 9% increase in average revenue per ticket, a 5% increase in the number of tickets sold and contributions from The V.I.P. Tour Company ("TicketsNow") and Paciolan, Inc. ("Paciolan"), acquired in February and January 2008, respectively. The increase in average domestic revenue per ticket resulted from higher convenience and processing fees due, in part, to annual contractual increases. International revenue grew by 30%, or 21% excluding the impact of foreign exchange, primarily due to a 13% increase in average revenue per

ticket along with a 9% increase in the number of tickets sold. Both the increases in the average revenue per ticket and the number of tickets sold primarily resulted from increased revenue from Canada, China (Emma Entertainment acquired in August 2007) and Australia. Acquisitions contributed approximately $45.0 million to Ticketmaster's overall revenue growth in 2008.

Ticketmaster's largest client, Live Nation, Inc. ("Live Nation") (including its subsidiary House of Blues), represented approximately 18% and 23% of its combined revenue for the three months ended June 30, 2008 and 2007, respectively. Ticketmaster anticipates that none of the Live Nation agreements will be renewed upon their expiration, which range from December 31, 2008 through March 1, 2010.

For the six months ended June 30, 2008 compared to the six months ended June 30, 2007

	Six Months Ended June 30,

	2008		% Change	2007
	(Dollars in thousands)
Domestic	$	501,260	22%	$	409,214
International		230,090	23%		187,779

Total revenue	$	731,350	23%	$	596,993

Revenue in 2008 increased $134.4 million, or 23%, from 2007 driven by increases in both domestic and international revenue as worldwide tickets sold increased 5%, with an 8% increase in average revenue per ticket. Domestic revenue grew by 22%, primarily due to contributions from TicketsNow and Paciolan, acquired in February and January 2008, respectively, as well as an 8% increase in average revenue per ticket and a 3% increase in the number of tickets sold. The increase in average domestic revenue per ticket resulted from higher convenience and processing fees as noted above in the three month discussion. International revenue grew by 23%, or 13% excluding the impact of foreign exchange, primarily due to an 11% increase in average revenue per ticket along with a 7% increase in the number of tickets sold. Both the increases in the average revenue per ticket and the number of tickets sold primarily resulted from increased revenue from Canada, China (Emma Entertainment acquired in August 2007) and Australia. Acquisitions contributed approximately $61.9 million to Ticketmaster's overall revenue growth in 2008.

Live Nation (including its subsidiary House of Blues) represented approximately 17% and 20% of Ticketmaster's combined revenue for the six months ended June 30, 2008 and 2007, respectively.

Cost of sales

For the three months ended June 30, 2008 compared to the three months ended June 30, 2007

	Three Months Ended June 30,

	2008		% Change		2007
	(Dollars in thousands)
Cost of sales	$	248,549		35%	$	183,860
As a percentage of total revenue		65%		234 bp		63%
Gross margin		35%		(234) bp		37%

bp = basis points

Cost of sales consists primarily of ticketing royalties, credit card processing fees and compensation and other employee-related costs (including stock-based compensation) for personnel engaged in call center functions. Ticketing royalties relate to Ticketmaster's clients' share of convenience and order processing charges.

Cost of sales in 2008 increased $64.7 million from 2007, primarily due to increases of $20.5 million in ticketing royalties, $13.9 million in compensation and other employee-related costs and $6.8 million in credit card processing fees which resulted from an increase in ticket volume processed. Included in these increases is the impact of acquisitions not in the year ago period, which contributed $1.7 million, $7.3 million and $1.9 million to ticketing royalties, compensation and other employee-related costs and credit card processing fees, respectively. Excluding the impact of acquisitions not in the year ago period, cost of sales increased $36.4 million, or 20%. The increase in ticketing royalties is due to increased revenue and higher royalty rates which are driven, in part, by higher contractual royalty rates included in the renewal of contracts with various clients, and are usually based on a percentage of convenience and order processing revenue. Domestic and international ticketing royalties will continue to increase as a percentage of convenience and processing revenue.

For the six months ended June 30, 2008 compared to the six months ended June 30, 2007

	Six Months Ended June 30,

	2008		% Change		2007
	(Dollars in thousands)
Cost of sales	$	469,571		27%	$	368,644
As a percentage of total revenue		64%		246 bp		62%
Gross margin		36%		(246) bp		38%

Cost of sales in 2008 increased $100.9 million from 2007, primarily due to increases of $33.2 million in ticketing royalties resulting from higher revenue and higher royalty rates, $25.2 million in compensation and other employee-related costs associated, in part, with a 22% increase in headcount (or 4% excluding recent acquisitions) and $8.3 million in credit card processing fees. Included in these increases is the impact of acquisitions not in the year ago period, which contributed $2.4 million, $13.2 million and $2.6 million to ticketing royalties, compensation and other employee-related costs and credit card processing fees, respectively. Excluding the impact of acquisitions not in the year ago period, cost of sales increased $61.3 million, or 17%.

Selling and marketing expense

For the three months ended June 30, 2008 compared to the three months ended June 30, 2007

	Three Months Ended June 30,

	2008		% Change		2007
	(Dollars in thousands)
Selling and marketing expense	$	24,636		202%	$	8,158
As a percentage of total revenue		6%		366 bp		3%

Selling and marketing expense consists primarily of advertising and promotional expenditures and compensation and other employee-related costs (including stock-based compensation) for personnel engaged in customer service and sales functions. Advertising and promotional expenditures primarily include online marketing, including fees paid to search engines and distribution partners, as well as offline marketing, including sports sponsorship marketing and radio spending.

Selling and marketing expense in 2008 increased $16.5 million from 2007, primarily due to increased advertising and promotional expenditures of $11.1 million and increased compensation and other employee-related costs of $3.0 million. Included in these increases is the impact of acquisitions not in the year ago period, which contributed $7.0 million and $1.8 million to advertising and promotional expenditures and compensation and other employee-related costs, respectively. Excluding the impact of acquisitions not in the year ago period, selling and marketing expense increased $5.5 million, or 68%. The increase in advertising and promotional expenditures is due in part to costs

associated with its agreements with resale partners which are intended to promote Ticketmaster's ticket exchange offering.

For the six months ended June 30, 2008 compared to the six months ended June 30, 2007

	Six Months Ended June 30,

	2008		% Change		2007
	(Dollars in thousands)
Selling and marketing expense	$	44,029		189%	$	15,231
As a percentage of total revenue		6%		347 bp		3%

Selling and marketing expense in 2008 increased $28.8 million from 2007, primarily due to increased advertising and promotional expenditures of $19.3 million and increased compensation and other employee-related costs of $5.4 million as Ticketmaster continued to build out its worldwide infrastructure. Included in these increases is the impact of acquisitions not in the year ago period, which contributed $9.2 million and $2.9 million to advertising and promotional expenditures and compensation and other employee-related costs, respectively. Excluding the impact of acquisitions not in the year ago period, selling and marketing expense increased $13.3 million, or 87%. The increase in advertising and promotional expenditures is due, in part, to an increase in marketing efforts including online and resale ticket services such as ticket exchange.

General and administrative expense

For the three months ended June 30, 2008 compared to the three months ended June 30, 2007

	Three Months Ended June 30,

	2008		% Change		2007
	(Dollars in thousands)
General and administrative expense	$	45,644		14%	$	39,892
As a percentage of total revenue		12%		(166) bp		14%

General and administrative expense consists primarily of compensation and other employee-related costs (including stock-based compensation) for personnel engaged in finance, legal, tax, human resources and executive management functions, facilities costs and fees for professional services.

General and administrative expense in 2008 increased $5.8 million from 2007, primarily due to increases of $5.8 million in compensation and other employee-related costs, $2.4 million in professional fees, $1.4 million in rent and utilities and $0.9 million in bad debt expense, partially offset by a reduction of $7.0 million in certain litigation reserves. The increase in compensation and other employee-related costs is primarily due to an increase of $4.6 million associated with recent acquisitions not in the year ago period. Excluding the impact of acquisitions not in the year ago period, general and administrative expense decreased $1.3 million, or 4%. Ticketmaster expects to incur increased costs related to the additional financial and legal requirements associated with being a separate public company, as well as increased non-cash compensation associated with the modification of existing stock-based compensation awards in connection with the spin-off and the grant of new awards in connection with and subsequent to the spin-off.

General and administrative expense includes non-cash compensation expense of $6.0 million in 2008 compared with $2.6 million in 2007. The increase in non-cash compensation expense is primarily due to equity grants issued and assumed in recent acquisitions as well as equity grants issued to Ticketmaster employees subsequent to the second quarter of 2007. As of June 30, 2008, there was approximately $44.7 million of unrecognized compensation cost, net of estimated forfeitures, related to all equity-based awards, which is currently expected to be recognized over a weighted average period of

approximately 2.6 years (exclusive of the impact of the modification related to the spin-off, which primarily consists of the accelerated vesting of certain restricted stock units).

For the six months ended June 30, 2008 compared to the six months ended June 30, 2007

	Six Months Ended June 30,

	2008		% Change		2007
	(Dollars in thousands)
General and administrative expense	$	87,497		18%	$	74,150
As a percentage of total revenue		12%		(46) bp		12%

General and administrative expense in 2008 increased $13.3 million from 2007, primarily due to increases of $10.1 million in compensation and other employee-related costs. The increase in compensation and other employee-related costs is primarily due to an increase of $7.4 million associated with recent acquisitions not in the year ago period. Excluding the impact of acquisitions not in the year ago period, general and administrative expense increased $2.2 million, or 3%.

General and administrative expense includes non-cash compensation expense of $10.3 million in 2008 compared with $4.1 million in 2007. The increase in non-cash compensation expense is primarily due to factors described above in the three month discussion.

Depreciation

For the three and six months ended June 30, 2008 compared to the three and six months ended June 30, 2007

	Three Months Ended June 30,						Six Months Ended June 30,

	2008		% Change		2007		2008		% Change		2007
	(Dollars in thousands)
Depreciation	$	11,828		25%	$	9,471	$	22,883		23%	$	18,592
As a percentage of total revenue		3%		(13) bp		3%		3%		1 bp		3%

Depreciation for the three and six months ended June 30, 2008 increased $2.4 million and $4.3 million, respectively, primarily due to various acquisitions not in the year ago period and the incremental depreciation associated with capital expenditures made during 2007 and 2008, partially offset by certain fixed assets becoming fully depreciated during the period. Excluding the impact of acquisitions not in the year ago period, depreciation expense for the three and six months increased $0.3 million and $0.8 million, or 3% and 4%, respectively.

Operating Income Before Amortization

Operating Income Before Amortization is a non-GAAP measure and is defined in "Ticketmaster's Principles of Financial Reporting".

For the three months ended June 30, 2008 compared to the three months ended June 30, 2007

	Three Months Ended June 30,

	2008		% Change		2007
	(Dollars in thousands)
Operating Income Before Amortization	$	58,340		6%	$	55,098
As a percentage of total revenue		15%		(352) bp		19%

Operating Income Before Amortization in 2008 increased $3.2 million from 2007, primarily due to an increase in revenue, partially offset by higher administrative and technology costs associated with acquisitions and the continued build out of worldwide infrastructure, increased costs associated with its agreements with resale partners, increased losses associated with strategic investments, particularly in Germany and China and higher royalty rates. Excluding the impact of acquisitions not in the year ago period, Operating Income Before Amortization increased $4.1 million, or 7%.

For the six months ended June 30, 2008 compared to the six months ended June 30, 2007

	Six Months Ended June 30,

	2008		% Change	2007
	(Dollars in thousands)
Operating Income Before Amortization	$	118,763	(5)%	$	125,318
As a percentage of total revenue		16%	(475) bp		21%

Operating Income Before Amortization in 2008 decreased $6.6 million from 2007, primarily due to increases in cost of sales, selling and marketing expense and general and administrative expense. The increase in these expenses was driven by acquisitions and increased losses associated with strategic investments, particularly in Germany and China and higher overall royalty rates. Excluding the impact of acquisitions not in the year ago period, Operating Income Before Amortization decreased $2.8 million, or 2%.

Operating income

For the three months ended June 30, 2008 compared to the three months ended June 30, 2007

	Three Months Ended June 30,

	2008		% Change	2007
	(Dollars in thousands)
Operating income	$	40,177	(11)%	$	45,368
As a percentage of total revenue		11%	(495) bp		15%

Operating income in 2008 decreased $5.2 million from 2007, despite the increase in Operating Income Before Amortization described above, primarily due to increases of $4.9 million in amortization of intangibles and $3.6 million in non-cash compensation expense. Excluding the impact of acquisitions not in the year ago period, operating income increased $4.3 million, or 10%.

For the six months ended June 30, 2008 compared to the six months ended June 30, 2007

	Six Months Ended June 30,

	2008		% Change	2007
	(Dollars in thousands)
Operating income	$	86,967	(19)%	$	106,856
As a percentage of total revenue		12%	(601) bp		18%

Operating income in 2008 decreased $19.9 million from 2007, primarily due to the decrease in Operating Income Before Amortization described above and increases of $6.9 million in amortization of intangibles and $6.5 million in non-cash compensation expense. Excluding the impact of acquisitions not in the year ago period, operating income decreased $3.2 million, or 3%.

During the second quarter of 2008, Ticketmaster began a comprehensive review of its worldwide cost structure in light of significant investments that have been made through increased operating and capital expenditures, acquisitions in recent periods, and in advance of the termination of the Live Nation agreement in 2009. As a result of this review, Ticketmaster currently intends to take the following actions, among others, which it currently expects will reduce its operating expenditures by an estimated $35 million on an annualized basis: (i) integration of Paciolan and TicketsNow, which were acquired in January and February 2008, respectively, (ii) the rationalization of certain ticketing platforms, products and services, (iii) certain operating cost reductions, including, among others, reductions in personnel, payment processing and discretionary costs, (iv) the consolidation of customer contact centers and (v) the review of global marketing and sponsorship costs for efficiency. Ticketmaster currently expects that achieving these actions will require some up-front costs, principally

severance costs and lease termination costs as well as the accelerated amortization of capitalized software and leasehold improvements, which costs are currently expected to be $4 to $6 million in total. Ticketmaster expects that these up-front costs will principally impact its 2008 results, starting in the third quarter, but the aggregate cash costs of these actions are not expected to materially impact Ticketmaster's overall financial position or liquidity.

Other income (expense)

For the three months ended June 30, 2008 compared to the three months ended June 30, 2007

		Three Months Ended June 30,

		2008			% Change		2007
		(Dollars in thousands)
Other income (expense):
	Interest income	$	1,430			(83)%	$	8,499
	Interest expense		(6,868	)		5,064%		(133	)
	Equity in (losses) income of uncombined affiliates		(1,468	)		NM		960
	Other expense		(287	)		39%		(208	)

During the second quarter of 2008, IAC recorded a cumulative true-up of intercompany interest income. The amount of the related adjustment was $8.3 million. Accordingly, there is intercompany interest income of $7.6 million in 2007 and intercompany interest expense of $6.3 million in 2008. This is the primary driver of the quarter over quarter variance in interest income and interest expense.

Equity in (losses) income of uncombined affiliates in 2008 decreased $2.4 million due to losses of $1.5 million, primarily due to Ticketmaster investment in Front Line.

For the six months ended June 30, 2008 compared to the six months ended June 30, 2007

		Six Months Ended June 30,

		2008			% Change		2007
		(Dollars in thousands)
Other income (expense):
	Interest income	$	3,022			(78)%	$	13,877
	Interest expense		(5,905	)		1,380%		(399	)
	Equity in (losses) income of uncombined affiliates		(802	)		NM		1,825
	Other income (expense)		657			NM		(125	)

As described above in the three month discussion during the second quarter of 2008, there is an $8.3 million adjustment related to a cumulative true-up of intercompany interest income. Accordingly, there is intercompany interest income of $12.2 million in 2007 and intercompany interest expense of $4.6 million in 2008. This is the primary driver of the year over year variance in interest income and interest expense.

Income tax provision

For the three months ended June 30, 2008 compared to the three months ended June 30, 2007

For the three months ended June 30, 2008 and 2007, Ticketmaster recorded tax provisions of $10.9 million and $19.9 million, respectively, which represent effective tax rates of 33% and 36%, respectively. The 2008 tax rate is lower than the federal statutory rate of 35% due principally to foreign income taxed at lower rates and foreign tax credits from foreign dividends, partially offset by state and local income taxes. The 2007 tax rate is higher than the federal statutory rate of 35% principally due to state and local income taxes.

For the six months ended June 30, 2008 compared to the six months ended June 30, 2007

For the six months ended June 30, 2008 and 2007, Ticketmaster recorded tax provisions of $29.7 million and $44.5 million, respectively, which represent effective tax rates of 35% and 36%, respectively. The 2008 tax rate approximates the federal statutory rate of 35% due principally to state and local income taxes, offset by foreign income taxed at lower rates and foreign tax credits from foreign dividends. The 2007 tax rate is higher than the federal statutory rate of 35% principally due to state and local income taxes.

As of December 31, 2007 and June 30, 2008, Ticketmaster had unrecognized tax benefits of approximately $5.5 million. Included in unrecognized tax benefits at June 30, 2008 is approximately $4.6 million for tax positions included in IAC's consolidated tax return filings that remained a liability of IAC after the spin-off. Ticketmaster recognizes interest and, if applicable, penalties related to unrecognized tax benefits in income tax expense. Included in income tax expense for the three and six months ended June 30, 2008 is $0.1 million and $0.2 million, net of related deferred taxes, for interest on unrecognized tax benefits. At June 30, 2008, Ticketmaster has accrued $1.1 million for the payment of interest. There are no material accruals for penalties.

By virtue of previously filed separate company and consolidated tax returns with IAC, Ticketmaster is routinely under audit by federal, state, local and foreign authorities in the area of income tax. These audits include questioning the timing and the amount of deductions and the allocation of income among various tax jurisdictions. Income taxes payable include amounts considered sufficient to pay assessments that may result from examination of prior year returns; however, the amount paid upon resolution of issues raised may differ from the amount provided. Differences between the reserves for tax contingencies and the amounts owed by Ticketmaster are recorded in the period they become known. Ticketmaster believes that it is reasonably possible that its unrecognized tax benefits could decrease by approximately $3.6 million within twelve months of the current reporting date due to the reversal of deductible temporary differences which will result in a corresponding increase in net deferred tax liabilities. An estimate of other changes in unrecognized tax benefits cannot be made, but are not expected to be significant.

Under the terms of the tax sharing agreement, which will be executed in connection with the spin-off, IAC will generally retain the liability related to federal and state returns filed on a consolidated or unitary basis for all periods prior to the spin-off.

LIQUIDITY AND CAPITAL RESOURCES

As of June 30, 2008, Ticketmaster had $524.9 million of cash and cash equivalents, restricted cash and cash equivalents and marketable securities, including $365.3 million in funds representing amounts equal to the face value of tickets sold on behalf of its clients. Ticketmaster's cash and cash equivalents and restricted cash and cash equivalents held in foreign jurisdictions is approximately $354.0 million at June 30, 2008, including $230.9 million in funds representing amounts equal to the face value of tickets sold on behalf of its clients, and is maintained principally in Canada, the United Kingdom and Australia.

Net cash provided by operating activities was $108.7 million and $126.0 million in 2008 and 2007, respectively. The decrease of $17.3 million in net cash provided by operating activities reflects an increase in the payments of accounts payable and other current liabilities and increased prepaid expenses and other current assets, partially offset by an increased contribution from client funds of $10.2 million which is primarily due to the timing of settlements with clients.

Net cash used in investing activities in 2008 of $563.1 million primarily resulted from acquisitions, net of cash acquired, of $393.5 million, cash transfers to IAC of $141.9 million and capital expenditures of $23.2 million. The cash transfers to IAC relate to IAC's centrally managed U.S. treasury function. Acquisitions, net of cash acquired, in 2008 primarily relate to the acquisitions of TicketsNow, Paciolan and GET ME IN! Ltd. Net cash used in investing activities in 2007 of $35.4 million primarily resulted from acquisitions, net of cash acquired, of $31.3 million and capital expenditures of $21.4 million, partially offset by cash transfers from IAC of $17.3 million.

Net cash provided by financing activities in 2008 and 2007 of $392.7 million and $32.2 million, respectively, were primarily due to capital contributions of $393.5 million and $31.3 million from IAC to fund Ticketmaster's 2008 and 2007 acquisitions, respectively.

In connection with the spin-off, Ticketmaster raised $750 million through a combination of privately issued debt securities (the "Notes") and secured credit facilities (the "Term Loans"). In addition, Ticketmaster negotiated a $200 million revolving credit facility (the "RCF"). The total costs incurred in connection with the issuance of the Notes and borrowings under the Term Loans and establishing the RCF are estimated to be $26.0 million. The net proceeds are approximately $724.0 million. In connection with the separation, Ticketmaster distributed the net proceeds of the financing to IAC and retained its client cash and its international cash which total approximately $488.4 million as of June 30, 2008. Upon completion of the spin-off, intercompany receivable balances were extinguished.

Ticketmaster anticipates that it will need to make capital and other expenditures in connection with the development and expansion of its operations. Ticketmaster's ability to fund its cash and capital needs will be affected by its ongoing ability to generate cash from operations, the overall capacity and terms of its financing arrangements as discussed above, and access to the capital markets. Ticketmaster believes that its cash on hand along with its anticipated operating cash flow in 2008 and its access to capital markets are sufficient to fund its operating needs, capital, investing and other commitments and contingencies for the foreseeable future.

CONTRACTUAL OBLIGATIONS AND COMMERCIAL COMMITMENTS

	Payments Due by Period

Contractual Obligations	Total		Less Than 1 Year		1-3 Years		3-5 Years		More Than 5 Years
	(In thousands)
Capital lease obligations	$	3,910	$	2,269	$	1,641	$	—	$	—
Purchase obligations(a)		84,634		31,781		39,407		11,271		2,175
Operating leases		93,688		20,077		32,509		19,852		21,250

Total contractual cash obligations	$	182,232	$	54,127	$	73,557	$	31,123	$	23,425

(a): The purchase obligations primarily arise from sports sponsorship agreements intended to promote Ticketmaster's ticket resale services.

Seasonality

Ticketmaster's ticket sales are impacted by fluctuations in the availability of events for sale to the public, which may vary depending upon scheduling by its clients. Generally, the second and fourth quarters of the year experience the highest revenue.

Recent Accounting Pronouncements

Refer to Note 2 to the combined financial statements for a description of recent accounting pronouncements.

TICKETMASTER'S PRINCIPLES OF FINANCIAL REPORTING

Ticketmaster reports Operating Income Before Amortization as a supplemental measure to generally accepted accounting principles ("GAAP"). This measure is one of the primary metrics by which Ticketmaster evaluates the performance of its businesses, on which its internal budgets are based and by which management is compensated. Ticketmaster believes that investors should have access to the same set of tools that it uses in analyzing its results. This non-GAAP measure should be considered in addition to results prepared in accordance with GAAP, but should not be considered a substitute for or superior to GAAP results. Ticketmaster provides and encourages investors to examine the reconciling adjustments between the GAAP and non-GAAP measure which are discussed below.

Definition of Ticketmaster's Non-GAAP Measure

Operating Income Before Amortization is defined as operating income excluding, if applicable: (1) non-cash compensation expense, (2) amortization and impairment of intangibles, (3) goodwill impairment, (4) pro forma adjustments for significant acquisitions, and (5) one-time items. Ticketmaster believes this measure is useful to investors because it represents the operating results from the Ticketmaster Businesses, taking into account depreciation, which Ticketmaster believes is an ongoing cost of doing business, but excluding the effects of any other non-cash expenses. Operating Income Before Amortization has certain limitations in that it does not take into account the impact to Ticketmaster's statement of operations of certain expenses, including non-cash compensation, and acquisition-related accounting. Ticketmaster endeavors to compensate for the limitations of the non-GAAP measure presented by also providing the comparable GAAP measure with equal or greater prominence and descriptions of the reconciling items, including quantifying such items, to derive the non-GAAP measure.

Pro Forma Results

Ticketmaster will only present Operating Income Before Amortization on a pro forma basis if it views a particular transaction as significant in size or transformational in nature. For the periods presented in this report, there are no transactions that Ticketmaster has included on a pro forma basis.

One-Time Items

Operating Income Before Amortization is presented before one-time items, if applicable. These items are truly one-time in nature and non-recurring, infrequent or unusual, and have not occurred in the past two years or are not expected to recur in the next two years, in accordance with SEC rules. For the periods presented in this report, there are no one-time items.

Non-Cash Expenses That Are Excluded From Ticketmaster's Non-GAAP Measure

Non-cash compensation expense consists principally of expense associated with the grants, including unvested grants assumed in acquisitions, of restricted stock, restricted stock units and stock options. These expenses are not paid in cash, and Ticketmaster will include the related shares in its future calculations of fully diluted shares outstanding. Upon vesting of restricted stock and restricted stock units and the exercise of certain stock options, the awards will be settled, at Ticketmaster's discretion, on a net basis, with Ticketmaster remitting the required tax withholding amount from its current funds.

Amortization of intangibles is a non-cash expense relating primarily to acquisitions. At the time of an acquisition, the intangible assets of the acquired company, such as purchase and distribution agreements, are valued and amortized over their estimated lives. While it is likely that Ticketmaster will have significant intangible amortization expense as it continues to acquire companies, Ticketmaster believes that since intangibles represent costs incurred by the acquired company to build value prior to acquisition, they were part of transaction costs.

RECONCILIATION OF OPERATING INCOME BEFORE AMORTIZATION

For a reconciliation of Operating Income Before Amortization to net income for the three and six months ended June 30, 2008 and 2007, see Note 5 to the combined financial statements.

Item 3. Quantitative and Qualitative Disclosures about Market Risk

Foreign Currency Exchange Risk

Ticketmaster conducts business in certain foreign markets, primarily in the European Union and Canada. Ticketmaster's primary exposure to foreign currency risk relates to its investments in foreign subsidiaries that transact business in a functional currency other than the U.S. Dollar, primarily the Euro, British Pound Sterling and Canadian Dollar. However, the exposure is mitigated as Ticketmaster has generally reinvested profits from its international operations in order to fund the growth of its international operations including acquisitions. Ticketmaster is also exposed to foreign currency risk related to its assets and liabilities denominated in a currency other than the functional currency.

As currency exchange rates change, translation of the income statements of Ticketmaster's international businesses into U.S. dollars affects year-over-year comparability of operating results. Historically, Ticketmaster has not hedged translation risks because cash flows from international operations have been generally reinvested locally. Foreign exchange net losses for the three months ended June 30, 2008 and 2007 were $0.3 million and $0.2 million, respectively. For the six months ended June 30, 2008 foreign exchange net gains were $0.7 million compared with foreign exchange net losses of $0.1 million for the six months ended June 30, 2007.

As Ticketmaster increases its operations in international markets it becomes increasingly exposed to potentially volatile movements in currency exchange rates. The economic impact of currency exchange rate movements on Ticketmaster is often linked to variability in real growth, inflation, interest rates, governmental actions and other factors. These changes, if material, could cause Ticketmaster to adjust its financing, operating and hedging strategies.

Item 4T. Controls and Procedures

The Company monitors and evaluates on an ongoing basis its disclosure controls in order to improve its overall effectiveness. In the course of this evaluation, the Company modifies and refines its internal processes as conditions warrant.

As required by Rule 13a-15(b) under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), our management, including our Chief Executive Officer and our Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures (as defined by Rule 13a-15(e) and 15d-15(e) under the Exchange Act). Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that as of the end of the period covered by this report, our disclosure controls and procedures were effective in providing reasonable assurance that information we are required to disclose in our filings with the Securities and Exchange Commission under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Commission's rules and Forms, and include controls and procedures designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is accumulated and communicated to our management, including our principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosure.

We are required to comply with Section 404 of the Sarbanes-Oxley Act of 2002 by our fiscal year ending December 31, 2009. The notification of such compliance is due no later than the time we file our annual report for the fiscal year ending December 31, 2009. We believe we are devoting adequate resources and expertise, both internal and external, in order to meet this requirement. However, there is no guarantee that our efforts will result in management's ability to conclude, or our independent registered public accounting firm to attest, that our internal control over financial reporting is effective as of December 31, 2009.

PART II. OTHER INFORMATION

Item 1. Legal Proceedings

Please see the discussion of legal proceedings in the Company's Post-Effective Amendment No. 1 to Form S-1 filed with the SEC on August 20, 2008, which is incorporated herein by reference and attached as Exhibit 99.1 hereto.

Item 1A. Risk Factors

Please see the discussion of risk factors in the Company's Post-Effective Amendment No. 1 to Form S-1 filed with the SEC on August 20, 2008, which is incorporated herein by reference and attached as Exhibit 99.2 hereto.

Item 6. Exhibits

The following documents are filed as Exhibits to the Report:

Exhibit Numbers			Description

	31.1		Certification of the Company's Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
	31.2		Certification of the Company's Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
	32		Certification of the Company's Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
	99.1		"Legal Proceedings" as set forth in the Company's Post-Effective Amendment No. 1 to Form S-1 filed with the SEC on August 20, 2008
	99.2		"Risk Factors" as set forth in the Company's Post-Effective Amendment No. 1 to Form S-1 filed with the SEC on August 20, 2008

SIGNATURES

Pursuant to the requirements of 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.


	TICKETMASTER

Date: September 22, 2008	By:	/s/ BRIAN REGAN Brian Regan Executive Vice President and Chief Financial Officer

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EXPLANATORY NOTE
TICKETMASTER INDEX
PART 1—FINANCIAL STATEMENTS

Item 1. Combined Financial Statements

TICKETMASTER AND SUBSIDIARIES COMBINED STATEMENTS OF OPERATIONS (Unaudited)
TICKETMASTER AND SUBSIDIARIES COMBINED BALANCE SHEETS
TICKETMASTER AND SUBSIDIARIES COMBINED STATEMENT OF INVESTED EQUITY (Unaudited)
TICKETMASTER AND SUBSIDIARIES COMBINED STATEMENTS OF CASH FLOWS (Unaudited)
TICKETMASTER AND SUBSIDIARIES NOTES TO UNAUDITED COMBINED FINANCIAL STATEMENTS

Item 2. Management's Discussion and Analysis of the Financial Condition and Results of Operations

GENERAL
LIQUIDITY AND CAPITAL RESOURCES
CONTRACTUAL OBLIGATIONS AND COMMERCIAL COMMITMENTS
TICKETMASTER'S PRINCIPLES OF FINANCIAL REPORTING
RECONCILIATION OF OPERATING INCOME BEFORE AMORTIZATION

Item 3. Quantitative and Qualitative Disclosures about Market Risk

Item 4T. Controls and Procedures

PART II. OTHER INFORMATION

Item 1. Legal Proceedings

Item 1A. Risk Factors

Item 6. Exhibits

SIGNATURES
EX-31.1 2 a2187681zex-31_1.htm EXHIBIT 31.1
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Exhibit 31.1

Certification

I, Sean Moriarty, Chief Executive Officer of Ticketmaster, certify that:

1.

I have reviewed this quarterly report on Form 10-Q of Ticketmaster;

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): [Intentionally deleted];
(c): 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
(d): 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: September 22, 2008		/s/ SEAN MORIARTY Sean Moriarty President and Chief Executive Officer

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Exhibit 31.1

Certification
EX-31.2 3 a2187681zex-31_2.htm EXHIBIT 31.2
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Exhibit 31.2

Certification

I, Brian Regan, Chief Financial Officer of Ticketmaster, certify that:

1.

I have reviewed this quarterly report on Form 10-Q of Ticketmaster;

2.

3.

4.

(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): [Intentionally deleted];
(c): 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
(d): 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.

(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: September 22, 2008		/s/ BRIAN REGAN Brian Regan Executive Vice President and Chief Financial Officer

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Exhibit 31.2

Certification
EX-32 4 a2187681zex-32.htm EXHIBIT 32
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Exhibit 32

Certification of Chief Executive Officer and Chief Financial Officer
Pursuant to 18 U.S.C. Section 1350

In connection with the Quarterly Report of Ticketmaster (the "Company") on Form 10-Q for the quarterly period ended June 30, 2008 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), we, Sean Moriarty, Chief Executive Officer of the Company, and Brian Regan, Chief Financial Officer of the Company, hereby certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to our knowledge:

1. The Report fully complies with the requirements of Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934, as amended; 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: September 22, 2008		/s/ SEAN MORIARTY Sean Moriarty President and Chief Executive Officer

Date: September 22, 2008		/s/ BRIAN REGAN Brian Regan Executive Vice President and Chief Financial Officer

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Exhibit 32

Certification of Chief Executive Officer and Chief Financial Officer Pursuant to 18 U.S.C. Section 1350
EX-99.1 5 a2187681zex-99_1.htm EXHIBIT 99.1
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Exhibit 99.1

Legal Proceedings

Ticketmaster Legal Proceedings

In the ordinary course of business, Ticketmaster and its subsidiaries are parties to litigation involving property, personal injury, contract, intellectual property and other claims. The amounts that may be recovered in such matters may be subject to insurance coverage. Ticketmaster does not believe that such ordinary course litigation will have a material effect on its business, financial condition or results of operations. For a discussion of litigation reserves, see "Management Overview—Results of Operations for the Years Ended December 31, 2007, 2006 and 2005—General and Administrative Expense."

Rules of the Securities and Exchange Commission require the description of material pending legal proceedings, other than ordinary, routine litigation incident to the registrant's business, and advise that proceedings ordinarily need not be described if they primarily involve damage claims for amounts (exclusive of interest and costs) not exceeding 10% of the current assets of the registrant and its subsidiaries on a consolidated basis. In the judgment of management, none of the pending litigation matters which Ticketmaster and its subsidiaries are defending, including those described below, involves or is likely to involve amounts of that magnitude. However, the pending litigation matters described below could involve substantial amounts, which could have an adverse effect on Ticketmaster's business, financial condition and results of operations.

UPS Consumer Class Action Litigation

Curt Schlessinger et al. v. Ticketmaster, No. BC304565 (Superior Court, Los Angeles County). On October 21, 2003, a purported representative action was filed in California state court, challenging Ticketmaster's charges to online customers for UPS ticket delivery. The complaint alleged in essence that it is unlawful for Ticketmaster not to disclose on its website that the fee it charges to online customers to have their tickets delivered by UPS contains a profit component. The complaint asserted a claim for violation of Section 17200 of the California Business and Professions Code and sought restitution or disgorgement of the difference between (i) the total UPS delivery fees charged by Ticketmaster in connection with online ticket sales during the applicable statute of limitations period, and (ii) the amount Ticketmaster paid to UPS for that service.

On December 31, 2004, the court denied Ticketmaster's motion for summary judgment. On April 1, 2005, the court denied the plaintiffs' motion for leave to amend their complaint to include UPS-delivery fees charged in connection with ticket orders placed by telephone. Citing Proposition 64, a California ballot initiative that outlawed so-called "representative" actions brought on behalf of the general public, the court ruled that since the named plaintiffs did not order their tickets by telephone, they lacked standing to assert a claim based on telephone ticket sales. The plaintiffs were granted leave to file an amended complaint that would survive application of Proposition 64.

On August 31, 2005, the plaintiffs filed an amended class-action and representative-action complaint alleging (i) as before, that Ticketmaster's website disclosures in respect of its charges for UPS ticket delivery violate Section 17200 of the California Business and Professions Code, and (ii) for the first time, that Ticketmaster's website disclosures in respect of its ticket order-processing fees constitute false advertising in violation of Section 17500 of the California Business and Professions Code. On this latter claim, the amended complaint seeks restitution or disgorgement of the entire amount of order-processing fees charged by Ticketmaster during the applicable statute of limitations period.

On September 1, 2005, in light of the newly pleaded claim based upon order-processing fees, Ticketmaster removed the case to federal court pursuant to the recently enacted federal Class Action

Fairness Act. See Curt Schlessinger et al. v. Ticketmaster, No. 05-CV-6515 (U.S. District Court, Central District of California). On October 3, 2005, the plaintiffs filed a motion to remand the case to state court, which Ticketmaster opposed. On March 23, 2006, the federal district court issued an order granting the plaintiffs' motion to remand the case to state court. On April 4, 2006, Ticketmaster filed a petition for leave to appeal the district court's order to the United States Court of Appeals for the Ninth Circuit, which the plaintiffs opposed. On May 25, 2006, the federal court of appeals issued an order denying Ticketmaster's petition; as a result, the case was remanded to state court.

On August 14, 2006, the plaintiffs filed a motion for class certification, which Ticketmaster opposed. On September 25, 2006, Ticketmaster filed a motion for judgment on the pleadings, which the plaintiffs opposed. On November 21, 2006, Ticketmaster requested that the court stay the case pending the California Supreme Court's decisions in two cases (In re Tobacco II Cases, 142 Cal. App. 4^th 891, and Pfizer Inc. v. Superior Court (Galfano), 141 Cal. App. 4^th 290) that present issues concerning the interpretation of Proposition 64 that are directly pertinent to both of the pending motions. The plaintiffs opposed Ticketmaster's request. On November 29, 2006, the court ordered that the case be stayed pending the California Supreme Court's ruling on the two cases referenced above.

On July 11, 2007, the court lifted its stay of the action for the limited purpose of allowing the plaintiffs to proceed with their motion for class certification. The parties thereafter submitted supplemental briefing in support of their respective positions and argued the motion at a September 20 hearing. On December 19, 2007, the court issued an order denying the plaintiffs' motion for class certification without prejudice. The court also issued an order staying the action for an additional 180 days or until the California Supreme Court issues a ruling in the Tobacco II and Pfizer appeals.

Ticketmaster believes that the claims in this putative class action lack merit and will continue to defend itself vigorously.

Securities Class Action Litigation

In re Ticketmaster Online-CitySearch, Inc. Initial Public Offering Securities Litigation, Case No. 01 Civ. 10822 (S.D.N.Y.). On November 30, 2001, a purported securities class action was filed against Ticketmaster and other defendants in the U.S. District Court for the Southern District of New York. Plaintiff's suit was brought on behalf of purchasers of Ticketmaster common stock during the period from the date of its initial public offering through December 6, 2000, and alleged violations by Ticketmaster of Section 10(b) of the Securities Exchange Act of 1934 and Section 11 of the Securities Act of 1933. Plaintiff alleged that Ticketmaster failed to disclose that its underwriters were to receive undisclosed and excessive compensation and had agreed to allocate shares in the IPO to customers in exchange for agreements to purchase shares in the aftermarket at pre-determined prices. This action was later consolidated with hundreds of similar actions against issuers and underwriters in the U.S. District Court for the Southern District of New York in In re Initial Public Offering Securities Litigation, No. 21 MC 92 (S.D.N.Y.). On February 19, 2003, the court granted a motion to dismiss the Section 10(b) claim against Ticketmaster, but denied the motion as to the Section 11 claim against Ticketmaster.

On October 13, 2004, the district court granted a motion for class certification in the six so-called class certification "focus" cases in the consolidated litigation. (Ticketmaster is not a party in any of these focus cases.) On December 5, 2006, the U.S. Court of Appeals for the Second Circuit reversed the trial court's decision. On August 14, 2007, plaintiffs filed amended complaints containing new class definitions in the six class certification focus cases. On September 27, 2007, plaintiffs moved for certification of the classes in these cases. On November 13, 2007, the issuer defendants filed a motion to dismiss the amended complaints in the focus cases. On March 26, 2008, the district court granted this motion in part and denied it in part. Accordingly, this action remains pending against Ticketmaster.

On June 10, 2004, plaintiffs and the issuer and individual defendants in the consolidated litigation had submitted to the district court for approval a proposed settlement that had previously been approved by various insurers of the issuer defendants. Approval of the proposed settlement would have resulted in the dismissal of all claims against Ticketmaster with no material impact on the company. However, in the wake of the appellate reversal of the district court's class-certification order, the proposed settlement was withdrawn on June 25, 2007.

Ticketmaster believes the claims in this putative class action lack merit and will continue to defend itself vigorously.

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Exhibit 99.1

Legal Proceedings
EX-99.2 6 a2187681zex-99_2.htm EXHIBIT 99.2
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Exhibit 99.2

RISK FACTORS

RISK FACTORS RELATING TO OUR SPIN-OFF FROM IAC

After our spin-off from IAC, we may be unable to make the changes necessary to operate effectively as a separate public entity.

Following our spin-off from IAC, IAC will have no obligation to provide financial, operational or organizational assistance to us, other than limited services pursuant to a transition services agreement that we will enter into with IAC and the other Spincos in connection with the spin-offs. As a separate public entity, we will be subject to, and responsible for, regulatory compliance, including periodic public filings with the SEC and compliance with NASDAQ's continued listing requirements, as well as generally applicable tax and accounting rules. We may be unable to implement successfully the changes necessary to operate as an independent public entity.

We expect to incur increased costs relating to operating as an independent company that could cause our cash flow and results of operations to decline.

We expect that the obligations of being a public company, including substantial public reporting and investor relations obligations, will require new expenditures, place new demands on our management and will require the hiring of additional personnel. We may need to implement additional systems that require new expenditures in order to adequately function as a public company. Such expenditures could adversely affect our business, financial condition and results of operations.

In addition, IAC's businesses, by virtue of being under the same corporate structure, currently share economies of scope and scale in costs, human capital, vendor relationships and customer relationships with the businesses that we and the other Spincos will own following the spin-offs. The increased costs resulting from the loss of these benefits could have an adverse effect on us.

If one or more spin-offs, together with certain related transactions, were to fail to qualify as a transaction that is generally tax free for U.S. federal income tax purposes under Sections 355 and/or 368(a)(1)(D) of the Code, IAC, the Spincos and IAC stockholders may be subject to significant tax liabilities.

In addition to the opinion set forth in "The Separation—Material U.S. Federal Income Tax Consequences of the Spin-Offs", IAC expects to receive a private letter ruling from the IRS and/or an opinion of counsel satisfactory to the IAC Board of Directors regarding the qualification of the spin-offs, together with certain related transactions, as transactions that are generally tax free for U.S. federal income tax purposes under Sections 355 and/or 368(a)(1)(D) of the Code. If the private letter ruling is received prior to the spin-offs, IAC expects to receive an opinion of counsel regarding certain aspects of the transaction that are not covered by the private letter ruling. If the private letter ruling is not received prior to the spin-offs, IAC expects to receive an opinion of counsel regarding the qualification of the spin-offs as transactions that are generally tax free for U.S. federal income tax purposes under Section 355 and/or Section 368(a)(1)(D) of the Code, and opinions from its external tax advisors regarding the U.S. federal income tax consequences to IAC of certain related matters and transactions, and certain state tax consequences to IAC of the spin-offs. The IRS private letter ruling and the opinions will be based on, among other things, certain assumptions as well as the accuracy of certain representations and statements that IAC and the Spincos make to the IRS and to counsel or IAC's external tax advisors. If any of these representations or statements are, or become, inaccurate or incomplete, or if IAC or the Spincos breach any of their respective covenants, the IRS private letter ruling and/or the opinions may be invalid.

Moreover, as noted above, the IRS private letter ruling would not address all the issues that are relevant to determining whether the spin-offs qualify as transactions that are generally tax free for U.S. federal income tax purposes. Notwithstanding the IRS private letter ruling and/or opinion of counsel, the IRS could determine that one or more of the spin-offs should be treated as a taxable distribution if it determines that any of the representations, assumptions or undertakings that were included in the request for the IRS private letter ruling is false or has been violated or if it disagrees with the conclusions in the opinion of counsel that are not covered by the IRS ruling.

If one or more spin-offs were to fail to qualify as a transaction that is generally tax free for U.S. federal income tax purposes under Sections 355 and/or 368(a)(1)(D) of the Code, then IAC generally would recognize gain in an amount equal to the excess of (i) the fair market value of the Spinco common stock distributed to the IAC stockholders in such taxable spin-off over (ii) IAC's tax basis in the common stock of such Spinco. In addition, each IAC stockholder who received Spinco common stock in such taxable spin-off generally would be treated as having received a taxable distribution in an amount equal to the fair market value of the Spinco common stock received (including any fractional share sold on behalf of the stockholder) in such spin-off, which would be taxable as a dividend to the extent of the stockholder's ratable share of IAC's current and accumulated earnings and profits (as increased to reflect any current income, including any gain, recognized by IAC on the taxable spin-off). The balance, if any, of the distribution would be treated as a nontaxable return of capital to the extent of the IAC stockholder's tax basis in its IAC stock, with any remaining amount being taxed as capital gain. For more information, see "The Separation—Material U.S. Federal Income Tax Consequences of the Spin-Offs," included elsewhere in this prospectus.

Under the Tax Sharing Agreement that we will enter into with IAC and the other Spincos, each Spinco generally would be required to indemnify IAC and the other Spincos for any taxes resulting from the spin-off of such Spinco (and any related interest, penalties, legal and professional fees, and all costs and damages associated with related stockholder litigation or controversies) to the extent such amounts resulted from (i) any act or failure to act by such Spinco described in the covenants in the Tax Sharing Agreement, (ii) any acquisition of equity securities or assets of such Spinco or a member of its group, or (iii) any breach by such Spinco or any member of its group of any representation or covenant contained in the separation documents or in the documents relating to the IRS private letter ruling and/or tax opinions. The ability of IAC or the other Spincos to collect under these indemnity provisions will depend on the financial position of the indemnifying party. See "Certain Relationships and Related Party Transactions—Tax Sharing Agreement."

In addition, the IRS could disagree with or challenge the conclusions reached in one or more of the tax opinions that IAC expects to receive with respect to certain related matters and transactions. In such case, IAC could recognize material amounts of taxable income or gain.

Certain transactions in IAC or Spinco equity securities could cause one or more of the spin-offs to be taxable to IAC and may give rise to indemnification obligations of Ticketmaster under the Tax Sharing Agreement.

Current U.S. federal income tax law creates a presumption that the spin-off of a Spinco would be taxable to IAC, but not to its stockholders, if such spin-off is part of a "plan or series of related transactions" pursuant to which one or more persons acquire directly or indirectly stock representing a 50% or greater interest (by vote or value) in IAC or such Spinco. Acquisitions that occur during the four-year period that begins two years before the date of a spin-off are presumed to occur pursuant to a plan or series of related transactions, unless it is established that the acquisition is not pursuant to a plan or series of transactions that includes the spin-off. U.S. Treasury regulations currently in effect generally provide that whether an acquisition and a spin-off are part of a plan is determined based on all of the facts and circumstances, including, but not limited to, specific factors described in the Treasury regulations. In addition, the Treasury regulations provide several "safe harbors" for acquisitions that are not considered to be part of a plan.

These rules will limit our ability and the ability of IAC during the two-year period following the spin-offs to enter into certain transactions that might be advantageous to them and their respective stockholders, particularly issuing equity securities to satisfy financing needs, repurchasing equity securities, and, under certain circumstances, acquiring businesses or assets with equity securities or agreeing to be acquired. Under the Tax Sharing Agreement, there will be restrictions on our ability to take such actions for a period of 25 months from the day after the date of our spin-off from IAC.

In addition, the Tax Sharing Agreement generally provides that each Spinco will have to indemnify IAC and the other Spincos for any taxes resulting from the spin-off of such Spinco (and any related interest, penalties, legal and professional fees, and all costs and damages associated with related stockholder litigation or controversies) to the extent such amounts result from (i) any act or failure to act by such Spinco described in the covenants in the Tax Sharing Agreement, (ii) any acquisition of equity securities or assets of such Spinco or a member of its group, and (iii) any breach by such Spinco or any member of its group of any representation or covenant contained in the separation documents or in the documents relating to the IRS private letter ruling and/or tax opinions. See "The Separation—Material U.S. Federal Income Tax Consequences of the Spin-Offs" and "Certain Relationships and Related Party Transactions—Tax Sharing Agreement."

In addition to actions of IAC and the Spincos, certain transactions that are outside their control and therefore not subject to the restrictive covenants contained in the Tax Sharing Agreement, such as a sale or disposition of the stock of IAC or the stock of a Spinco by certain persons that own five percent or more of any class of stock of IAC or such Spinco, respectively, could have a similar effect on the tax-free status of the spin-offs as transactions to which IAC or a Spinco is a party. As of April 30, 2008, Liberty Media Corporation and certain of its affiliates, in the aggregate, owned IAC stock representing approximately 61.6% by vote and 29.9% by value and, assuming no acquisitions or dispositions of IAC stock by Liberty Media Corporation or its affiliates between such date and the date of the spin-offs, are expected to own stock of each Spinco representing approximately 29.9% by vote and value. Accordingly, in evaluating our ability and the ability of IAC to engage in certain transactions involving our or IAC's equity securities, we and IAC will need to take into account the activities of Liberty Media Corporation and its affiliates.

As a result of these rules, even if the Ticketmaster spin-off otherwise qualifies as a transaction that is generally tax-free for U.S. federal income tax purposes, transactions involving Ticketmaster or IAC equity securities (including transactions by certain significant stockholders) could cause IAC to recognize taxable gain with respect to the stock of Ticketmaster as described above. Although the restrictive covenants and indemnification provisions contained in the Tax Sharing Agreement are intended to minimize the likelihood that such an event will occur, the Ticketmaster spin-off may become taxable to IAC as a result of transactions in IAC or Ticketmaster equity securities.

The market price and trading volume of Ticketmaster securities may be volatile and may face negative pressure.

There is currently no trading market for any Ticketmaster securities. Investors may decide to dispose of some or all of the Ticketmaster securities that they receive in the Ticketmaster spin-off. Ticketmaster securities issued in the Ticketmaster spin-off will be trading publicly for the first time. Until, and possibly even after, orderly trading markets develop for these securities, there may be significant fluctuations in price. It is not possible to accurately predict how investors in Ticketmaster's securities will behave after the Ticketmaster spin-off. The market price for Ticketmaster's securities following the Ticketmaster spin-off may be more volatile than the market price of IAC securities before the spin-off. The market price of Ticketmaster's securities could fluctuate significantly for many reasons, including the risks identified in this prospectus or reasons unrelated to our performance. These factors may result in short- or long-term negative pressure on the value of the Ticketmaster securities.

After our spin-off from IAC, our securities may not qualify for placement in investment indices. In addition, our securities may fail to meet the investment guidelines of institutional investors. In either case, these factors may negatively impact the price of our securities and may impair our ability to raise capital through the sale of securities.

Some of the holders of IAC securities are index funds tied to NASDAQ or other stock or investment indices, or are institutional investors bound by various investment guidelines. Companies are generally selected for investment indices, and in some cases selected by institutional investors, based on factors such as market capitalization, industry, trading liquidity and financial condition. As an independent company, we will initially have a lower market capitalization than IAC has today. As a result, our securities may not qualify for those investment indices. In addition, the securities that are received in the Ticketmaster spin-off may not meet the investment guidelines of some institutional investors. Consequently, these index funds and institutional investors may have to sell some or all of the securities they receive in the Ticketmaster spin-off, and the price of our securities may fall as a result. Any such decline could impair our ability to raise capital through future sales of securities.

Financing—We may have future capital needs and may not be able to obtain additional financing on acceptable terms.

In connection with our spin-off from IAC, we expect to incur indebtedness of approximately $750 million. We expect that we will distribute most or all of the proceeds from this indebtedness to IAC.

These arrangements may limit our ability of to secure significant, additional financing in the future on favorable terms. Our ability to secure additional financing and satisfy our financial obligations under indebtedness outstanding from time to time will depend upon our future operating performance, which is subject to then prevailing general economic and credit market conditions, including interest rate levels and the availability of credit generally, and financial, business and other factors, many of which are beyond our control. The prolonged continuation or worsening of current credit market conditions would have a material adverse effect on our ability to secure financing on favorable terms, if at all.

We may be unable to secure additional financing or financing on favorable terms or our operating cash flow may be insufficient to satisfy our financial obligations under indebtedness outstanding from time to time (if any). Furthermore, if financing is not available when needed, or is available on unfavorable terms, we may be unable to develop new or enhance our existing services, complete acquisitions or otherwise take advantage of business opportunities or respond to competitive pressures, any of which could have a material adverse effect on our business, financial condition and results of operations. If additional funds are raised through the issuance of equity securities, our stockholders may experience significant dilution. Also, our ability to engage in significant equity issuances will be limited or restricted after our spin-off from IAC in order to preserve the tax-free nature of the distribution.

The spin-off agreements were not the result of arm's length negotiations.

The agreements that we will enter into with IAC and the other Spincos in connection with the spin-offs, including the separation and distribution agreement, tax sharing agreement, employee matters agreement and transition services agreement, were established by IAC, in consultation with the Spincos, with the intention of maximizing the value to current IAC's shareholders. Accordingly, the terms for us may not be as favorable as would have resulted from negotiations among unrelated third parties.

RISK FACTORS RELATING TO OUR BUSINESS FOLLOWING
TICKETMASTER'S SPIN-OFF FROM IAC

Live Entertainment Industry and General Economic Trends—Our success depends, in significant part, on entertainment, sporting and leisure events and factors adversely affecting such events could have a material adverse effect on our business, financial condition and results of operations.

We sell tickets to live entertainment, sporting and leisure events at arenas, stadiums, theaters and other facilities, and accordingly, our business, financial condition and results of operations are directly affected by the popularity, frequency and location of such events. Ticket sales are sensitive to fluctuations in the number and pricing of entertainment, sporting and leisure events and activities offered by promoters, teams and facilities, and adverse trends in the entertainment, sporting and leisure event industries could adversely affect our business, financial condition and results of operations. We rely on third parties to create and perform live entertainment, sporting and leisure events and to price tickets to such events. Accordingly, our success depends, in part, upon the ability of these third parties to correctly anticipate public demand for particular events and the prices that the public is willing to pay to attend such events, as well as the availability of popular artists, entertainers and teams.

In addition, general economic conditions, consumer trends, work stoppages, natural disasters and terrorism could have a material adverse effect on our business, financial condition and results of operations. Entertainment-related expenditures are particularly sensitive to business and personal discretionary spending levels, which tend to decline during general economic downturns.

Third Party Relationships—We depend on relationships with clients and any adverse changes in these relationships could adversely affect our business, financial condition and results of operations.

Our success is dependent, in significant part, on the ability of our businesses to maintain and renew relationships with existing clients and to establish new client relationships. We anticipate that for the foreseeable future, the substantial majority of our revenues will be derived from online and offline sales of tickets. We also expect that revenues from primary ticketing services, which consist primarily of per ticket convenience charges and per order "order processing" fees, will continue to comprise the substantial majority of our consolidated revenues. For the year ended December 31, 2007, our businesses provided primary ticketing services to over 9,000 clients.

Securing the right to sell tickets depends, in substantial part, on the ability of our businesses to enter into, maintain and renew client contracts on favorable terms. Revenue attributable to our largest client, Live Nation (including its subsidiary, House of Blues), represented approximately 17% of our total revenue in 2007. This client relationship consists of four agreements, two with Live Nation (a worldwide agreement (other than England, Scotland and Wales) that expires on December 31, 2008, and an agreement covering England, Scotland and Wales that expires on December 31, 2009) and two with House of Blues (a U.S. agreement that expires on December 31, 2009, and a Canadian agreement that expires on March 1, 2010). Revenue attributable to the worldwide agreement and the agreement covering England, Scotland and Wales represented approximately 11% and 3%, respectively, of our total revenues in 2007. Each party has the right to terminate the agreement covering England, Scotland and Wales as of December 31, 2008, in which case Live Nation would be obligated to pay us a termination fee in an amount equal to 1.25 times the average of our annual net profits under the agreement for 2007 and 2008. We anticipate that none of these agreements will be renewed. In addition, Live Nation has publicly announced that it will launch its own ticketing business in 2009 and that it intends to ticket Live Nation events and compete with Ticketmaster for third party clients.

We cannot provide assurances that our businesses will continue to be able to maintain other existing client contracts, or enter into or maintain new client contracts, on acceptable terms, if at all, and the failure to do so could have a material adverse effect on our business, financial condition and results of operations. In addition, facilities, promoters and other potential clients are increasingly

electing to self-ticket and/or distribute a growing number of tickets through client direct or other new channels, which could adversely impact the ability of our businesses to secure renewals and new client contracts. The non-renewal or termination of an agreement with a major client or multiple agreements with a combination of smaller clients could have a material adverse effect on our business, financial condition and results of operations.

Another important component of our success is the ability of our businesses to maintain existing and build new relationships with third party distribution channels and service providers, including providers of credit card processing and delivery services, as well as advertisers, among other parties. Any adverse changes in these relationships, including the inability of these parties to fulfill their obligations to our businesses for any reason, could adversely affect our business, financial condition and results of operations.

Brand Recognition—Failure to maintain brand recognition and attract and retain customers in a cost-effective manner could adversely affect our business, financial condition and results of operations.

Maintaining and promoting the Ticketmaster and ticketmaster.com (and related international) brand names and, to a lesser extent, the ticketsnow.com, ticketweb.com, museumtix.com and tmvista.com (and related international) brand names, is critical to the ability of our businesses to attract consumers and business customers to their respective websites and other distribution channels. We believe that the importance of brand recognition will increase, given the growing number of online ticketing services due to relatively low barriers to entry to providing internet online content and services. Accordingly, our businesses have spent, and expect to continue to spend, increasing amounts of money on, and devote greater resources to, branding and other marketing initiatives, including search engine optimization techniques and paid search engine marketing, neither of which may be successful or cost-effective. Ticketmaster believes that rates for desirable online advertising and marketing are likely to increase in the foreseeable future. The failure of our businesses to maintain the recognition of their respective brands and to attract and retain consumers in a cost-effective manner could adversely affect our business, financial condition and results of operations.

Acquisitions—We may experience operational and financial risks in connection with acquisitions. In addition, some of the businesses acquired by us may incur significant losses from operations or experience impairment of carrying value.

Our growth may depend upon future acquisitions and depends, in part, on our ability to successfully integrate historical acquisitions. We may experience operational and financial risks in connection with acquisitions. To the extent that we continue to grow through acquisitions, we will need to:

•: successfully integrate the operations, as well as the accounting, financial controls, management information, technology, human resources and other administrative systems, of acquired businesses with existing operations and systems;
•: retain the clients of the acquired businesses;
•: retain senior management and other key personnel at acquired businesses; and
•: successfully manage acquisition-related strain on our management, operations and financial resources and/or those of acquired businesses.

We may not be successful in addressing these challenges or any others encountered in connection with historical and future acquisitions and the failure to do so could adversely affect our business, financial condition and results of operations. The anticipated benefits of one or more acquisitions may not be realized and future acquisitions could result in potentially dilutive issuances of equity securities and/or contingent liabilities. Also, the value of goodwill and other intangible assets acquired could be

impacted by one or more unfavorable events or trends, which could result in impairment charges. The occurrence of any of these events could adversely affect our business, financial condition and results of operations.

Through certain recent (and potentially future) acquisitions, such as the acquisitions of TicketsNow, Emma Entertainment, Echo and GetMeIn!, we entered (or may enter) into aspects of the ticketing and/or entertainment industries in which we have not previously participated directly. Acquisitions of this nature could adversely affect relationships with new and potential clients to the extent that clients view the interests of acquired businesses, or those of Ticketmaster overall following the completion of any such acquisitions, as competing with or diverging from their own, which could adversely impact our relationships with its clients and its ability to attract new clients, which would adversely affect our business, financial condition and results of operations.

International Presence and Expansion—Our businesses operate in international markets in which they have limited experience. Our businesses may not be able to successfully expand into new, or further into existing, international markets.

We provide services in various jurisdictions abroad through a number of brands and businesses that we own and operate, as well as through joint ventures, and expect to continue to expand our international presence. See "Business of Ticketmaster—International Operations." We face, and expect to continue to face, additional risks in the case of our existing and future international operations, including:

•: political instability and unfavorable economic conditions in the markets in which we currently have international operations or into which our brands and businesses may expand;
•: more restrictive or otherwise unfavorable government regulation of the live entertainment and ticketing industries, including the regulation of the provision of primary ticketing and ticket resale services, as well promotional, marketing and other related services, which could result in increased compliance costs and/or otherwise restrict the manner in which our businesses provide services and the amount of related fees charged for such services;
•: limitations on the enforcement of intellectual property rights, which would preclude us from building the brand recognition upon which we have come to rely in many jurisdictions;
•: limitations on the ability of foreign subsidiaries to repatriate profits or otherwise remit earnings to us;
•: adverse tax consequences;
•: limitations on technology infrastructure, which could limit our ability to migrate international operations to the Ticketmaster System, which would result in increased costs;
•: lower levels of internet usage, credit card usage and consumer spending in comparison to those in the United States; and
•: difficulties in managing operations and adapting to consumer desires due to distance, language and cultural differences, including issues associated with management and operational systems and infrastructures, including internal financial control and reporting systems and functions, staffing and managing foreign operations, which we might not be able to do effectively, or if so, on a cost-effective basis.

Our ability to expand our international operations into new, or further into existing, jurisdictions will depend, in significant part, on our ability to identify potential acquisition candidates, joint venture or other partners, and enter into arrangements with these parties on favorable terms, as well as our ability to make continued investments to maintain and grow existing international operations. If the

revenues generated by international operations are insufficient to offset expenses incurred in connection with the maintenance and growth of these operations, our business, financial condition and results of operations could be materially and adversely affected. In addition, in an effort to make international operations in one or more given jurisdictions profitable over the long term, significant additional investments that are not profitable over the short term could be required over a prolonged period.

In addition, the ticketing industry in many jurisdictions abroad is more fragmented and local than it is in the United States. Our success in these markets will depend on the ability of our businesses to create economies of scale by consolidating within each market geographically, which would most likely occur over a prolonged period, during which significant investments in technology and infrastructure would be required. In the case of expansion through organic growth, we would face substantial barriers to entry in new, and expansion into existing, markets due primarily to the risks and concerns discussed above, among others.

Lastly, to the extent that costs and prices for services are established in local currencies and adjusted to U.S. dollars based on then-current exchange rates, we will be exposed to foreign exchange rate fluctuations. After accounting for such fluctuations, we may be required to record significant gains or losses, the amount of which will vary based on then current exchange rates, which could cause our results to differ materially from expectations. As we continue to expand our international presence, our exposure to exchange rate fluctuations will increase.

Changing Customer Requirements and Industry Standards—Our businesses may not be able to adapt quickly enough to changing customer requirements and industry standards.

The e-commerce industry is characterized by evolving industry standards, frequent new service and product introductions and enhancements and changing customer demands. Our businesses may not be able to adapt quickly enough and/or in a cost-effective manner to changes in industry standards and customer requirements and preferences, and their failure to do so could adversely affect our business, financial condition and results of operations. In addition, the continued widespread adoption of new internet or telecommunications technologies and devices or other technological changes could require our businesses to modify or adapt their respective services or infrastructures. The failure of our businesses to modify or adapt their respective services or infrastructures in response to these trends could render their existing websites, services and proprietary technologies obsolete, which could adversely affect our business, financial condition and results of operations.

In addition, we are currently in the process of migrating our international brands and businesses to the Ticketmaster System in an attempt to provide consistent and state-of-the-art services across our businesses and to reduce the cost and expense of maintaining multiple systems, which we may not be able to complete in a timely or cost-effective manner. Delays or difficulties in implementing the Ticketmaster System, as well as any new or enhanced systems, may limit our ability to achieve the desired results in a timely manner. Also, we may be unable to devote financial resources to new technologies and systems in the future, which could adversely affect our business financial condition and results of operations.

Compliance and Changing Laws, Rules and Regulations—Our failure to comply with existing laws, rules and regulations as well as changing laws, rules and regulations and legal uncertainty, could adversely affect our business, financial condition and results of operations.

Since our businesses sell tickets and provide related services to consumers through a number of different online and offline channels, they are subject to a wide variety of statutes, rules, regulations, policies and procedures in various jurisdictions in the United States and abroad, which are subject to change at any time. For example, our businesses conduct marketing activities via the telephone and/or

through online marketing channels, which activities are governed by numerous federal and state regulations, such as the Telemarketing Sales Rule, state telemarketing laws and the CAN-SPAM Act, among others. Our businesses are also subject to laws, rules and regulations applicable to providers of primary ticketing and ticket resale services, which in some cases regulate the amount of transaction and other fees that they may be charged in connection with primary ticketing sales and/or the ticket prices that may be charged in the case of ticket resale services, and new legislation of this nature is introduced from time to time in various (and is pending in certain) jurisdictions in which our businesses sell tickets and provide services. For example, several U.S. states and cities, Canadian provinces, the United Kingdom and European countries prohibit the resale of tickets at prices greater than the original face price (in the case of certain jurisdictions, without the consent of the venue) and/or prohibit the resale of tickets to certain types of events. The failure of our businesses to comply with these laws and regulations could result in fines and/or proceedings against us by governmental agencies and/or consumers, which if material, could adversely affect our business, financial condition and results of operations. In addition, the promulgation of new laws, rules and regulations that restrict or otherwise unfavorably impact the ability or manner in which our businesses provide primary ticketing and ticket resale services would require our businesses to change certain aspects of their business, operations and client relationships to ensure compliance, which could decrease demand for services, reduce revenues, increase costs and/or subject us to additional liabilities.

In addition, the application of various domestic and international sales, use, value-added and other tax laws, rules and regulations to our historical and new products and services is subject to interpretation by applicable taxing authorities. While we believe that we are compliant with current tax provisions, taxing authorities may take a contrary position and such positions may adversely affect our business, financial condition and results of operations.

From time to time, federal, state and local authorities and/or consumers commence investigations, inquiries or litigation with respect to compliance by us and our businesses with applicable consumer protection, advertising, unfair business practice, antitrust (and similar or related laws) and other laws. Our businesses have historically cooperated with authorities in connection with these investigations and have satisfactorily resolved each such material investigation, inquiry or litigation. We have incurred significant legal expenses in connection with the defense of governmental investigations and litigation in the past and may be required to incur additional expenses in the future should investigations and litigation be instituted. In the case of antitrust (and similar or related) matters, any adverse outcome could limit or prevent our businesses from engaging in the ticketing business generally (or in a particular market thereof) or subject them to potential damage assessments, all of which could have a material adverse effect on our business, financial condition and results of operations.

Maintenance of Systems and Infrastructure—Our success depends, in part, on the integrity of our systems and infrastructures. System interruption and the lack of integration and redundancy in these systems and infrastructures may have an adverse impact on our business, financial conditions and results of operations.

Our success depends, in part, on our ability to maintain the integrity of our systems and infrastructures, including websites, information and related systems, call centers and distribution and fulfillment facilities. System interruption and the lack of integration and redundancy in our information systems and infrastructures may adversely affect our ability to operate websites, process and fulfill transactions, respond to customer inquiries and generally maintain cost-efficient operations. We may experience occasional system interruptions that make some or all systems or data unavailable or prevent our businesses from efficiently providing services or fulfilling orders. We also rely on affiliate and third-party computer systems, broadband and other communications systems and service providers in connection with the provision of services generally, as well as to facilitate, process and fulfill transactions. Any interruptions, outages or delays in our systems and infrastructures, our businesses, our affiliates and/or third parties, or deterioration in the performance of these systems and infrastructures,

could impair the ability of our businesses to provide services, fulfill orders and/or process transactions. Fire, flood, power loss, telecommunications failure, hurricanes, tornadoes, earthquakes, acts of war or terrorism, acts of God and similar events or disruptions may damage or interrupt computer, broadband or other communications systems and infrastructures at any time. Any of these events could cause system interruption, delays and loss of critical data, and could prevent our businesses from providing services, fulfilling orders and/or processing transactions. While our businesses have backup systems for certain aspects of their operations, disaster recovery planning is not sufficient for all eventualities. In addition, we may not have adequate insurance coverage to compensate for losses from a major interruption. If any of these adverse events were to occur, it could adversely affect our business, financial conditions and results of operations.

In addition, any penetration of network security or other misappropriation or misuse of personal consumer information could cause interruptions in the operations of our businesses and subject us to increased costs, litigation and other liabilities. Claims could also be made against us for other misuse of personal information, such as for unauthorized purposes or identity theft, which could result in litigation and financial liabilities, as well as administrative action from governmental authorities. Security breaches could also significantly damage our reputation with consumers and third parties with whom we do business. It is possible that advances in computer capabilities, new discoveries, undetected fraud, inadvertent violations of company policies or procedures or other developments could result in a compromise of information or a breach of the technology and security processes that are used to protect consumer transaction data. As a result, current security measures may not prevent any or all security breaches. We may be required to expend significant capital and other resources to protect against and remedy any potential or existing security breaches and their consequences. We also face risks associated with security breaches affecting third parties with which we are affiliated or otherwise conduct business online. Consumers are generally concerned with security and privacy of the Internet, and any publicized security problems affecting our businesses and/or those of third parties may discourage consumers from doing business with us, which could have an adverse effect on our business, financial condition and results of operations.

Privacy—The processing, storage, use and disclosure of personal data could give rise to liabilities as a result of governmental regulation, conflicting legal requirements or differing views of personal privacy rights.

In the processing of consumer transactions, our businesses receive, transmit and store a large volume of personally identifiable information and other user data. The sharing, use, disclosure and protection of this information are governed by the privacy and data security policies maintained by us and our businesses. Moreover, there are federal, state and international laws regarding privacy and the storing, sharing, use, disclosure and protection of personally identifiable information and user data. Specifically, personally identifiable information is increasingly subject to legislation and regulations in numerous jurisdictions around the world, the intent of which is to protect the privacy of personal information that is collected, processed and transmitted in or from the governing jurisdiction. We could be adversely affected if legislation or regulations are expanded to require changes in business practices or privacy policies, or if governing jurisdictions interpret or implement their legislation or regulations in ways that negatively affect our business, financial condition and results of operations.

Our businesses may also become exposed to potential liabilities as a result of differing views on the privacy of consumer and other user data collected by these businesses. Our failure, and/or the failure by the various third party vendors and service providers with which we do business, to comply with applicable privacy policies or federal, state or similar international laws and regulations or any compromise of security that results in the unauthorized release of personally identifiable information or other user data could damage the reputation of these businesses, discourage potential users from trying our products and services and/or result in fines and/or proceedings by governmental agencies and/or

consumers, one or all of which could adversely affect our business, financial condition and results of operations.

Intellectual Property—We may fail to adequately protect our intellectual property rights or may be accused of infringing intellectual property rights of third parties.

We may fail to adequately protect our intellectual property rights or may be accused of infringing intellectual property rights of third parties. We regard our intellectual property rights, including patents, service marks, trademarks and domain names, copyrights, trade secrets and similar intellectual property (as applicable) as critical to our success. Our businesses also rely heavily upon software codes, informational databases and other components that make up their products and services.

We rely on a combination of laws and contractual restrictions with employees, customers, suppliers, affiliates and others to establish and protect these proprietary rights. Despite these precautions, it may be possible for a third party to copy or otherwise obtain and use trade secret or copyrighted intellectual property without authorization which, if discovered, might require legal action to correct. In addition, third parties may independently and lawfully develop substantially similar intellectual properties.

We have generally registered and continue to apply to register, or secure by contract when appropriate, our trademarks and service marks as they are developed and used, and reserve and register domain names as we deem appropriate. We generally consider the protection of our trademarks to be important for purposes of brand maintenance and reputation. While we vigorously protect our trademarks, service marks and domain names, effective trademark protection may not be available or may not be sought in every country in which products and services are made available, and contractual disputes may affect the use of marks governed by private contract. Similarly, not every variation of a domain name may be available or be registered, even if available. Our failure to protect our intellectual property rights in a meaningful manner or challenges to related contractual rights could result in erosion of brand names and limit our ability of to control marketing on or through the internet using our various domain names or otherwise, which could adversely affect our business, financial condition and results of operations.

Some of our businesses have been granted patents and/or have patent applications pending with the United States Patent and Trademark Office and/or various foreign patent authorities for various proprietary technologies and other inventions. We consider applying for patents or for other appropriate statutory protection when we develop valuable new or improved proprietary technologies or inventions are identified, and will continue to consider the appropriateness of filing for patents to protect future proprietary technologies and inventions as circumstances may warrant. The status of any patent involves complex legal and factual questions, and the breadth of claims allowed is uncertain. Accordingly, any patent application filed may not result in a patent being issued or existing or future patents may not be adjudicated valid by a court or be afforded adequate protection against competitors with similar technology. In addition, third parties may create new products or methods that achieve similar results without infringing upon patents that we own. Likewise, the issuance of a patent to us does not mean that our processes or inventions will not be found to infringe upon patents or other rights previously issued to third parties.

From time to time, we are subject to legal proceedings and claims in the ordinary course of business, including claims of alleged infringement of the trademarks, copyrights, patents and other intellectual property rights of third parties. In addition, litigation may be necessary in the future to enforce our intellectual property rights, protect trade secrets or to determine the validity and scope of proprietary rights claimed by others. Any litigation of this nature, regardless of outcome or merit, could result in substantial costs and diversion of management and technical resources, any of which could adversely affect our business, financial condition and results of operations. Patent litigation tends to be particularly protracted and expensive.

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Exhibit 99.2

RISK FACTORS
RISK FACTORS RELATING TO OUR SPIN-OFF FROM IAC
RISK FACTORS RELATING TO OUR BUSINESS FOLLOWING TICKETMASTER'S SPIN-OFF FROM IAC
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