8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of

the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): January 2, 2014

GROUPON, INC.

(Exact name of registrant as specified in its charter)

Delaware (State or other jurisdiction of incorporation) 1-353335 (Commission File Number) 27-0903295 (I.R.S. Employer Identification No.)

600 West Chicago Avenue, Suite 400 Chicago, Illinois  (Address of principal executive offices) 60654 (Zip Code)

312-676-5773

(Registrant's telephone number, including area code)

N/A

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 1.01. Entry into a Material Definitive Agreement.

On January 1, 2014, Groupon, Inc. (the "Company") entered into Amendment No. 2 to the Share Purchase Agreement (the "Amendment") by and among the Company, Groupon Trailblazer, Inc. ("Groupon Trailblazer"), LivingSocial, Inc. ("LivingSocial"), and LivingSocial, B.V. ("LivingSocial B.V."). The Amendment was entered into in connection with the previously reported Share Purchase Agreement, dated as of November 6, 2013 (the "Share Purchase Agreement"), and Amendment No. 1 to the Share Purchase Agreement, dated as of November 26, 2013, by and among the Company, Groupon Trailblazer, LivingSocial and LivingSocial B.V., pursuant to which Groupon Trailblazer will acquire (the "Acquisition") all of the issued and outstanding share capital of LivingSocial Korea, Inc. ("LS Korea"), the holding company of Ticket Monster Inc. ("Ticket Monster").

Pursuant to the Amendment, the parties agreed that LivingSocial will provide certain post-closing support to the Company in the preparation of certain financial statements of LS Korea for the quarter and year ended December 31, 2013.  The parties also agreed that LivingSocial may sell the shares of Class A common stock that it will receive as consideration for the transaction in an underwritten offering, and that LivingSocial will be responsible for certain expenses in connection therewith.

The foregoing description of the Amendment is qualified in its entirety by reference to the full text of the Amendment which is attached to this Current Report on Form 8-K as Exhibit 2.1 and incorporated herein by reference in its entirety. The Amendment has been attached to provide investors with information regarding its terms. It is not intended to provide any other factual information about the Company, Groupon Trailblazer, LS Korea or Ticket Monster.

Item 2.01. Completion of Acquisition or Disposition of Assets.

On January 2, 2014, the Company and Groupon Trailblazer completed its previously reported acquisition of LS Korea pursuant to a Share Purchase Agreement, dated November 6, 2013, as amended, by and among the Company, LivingSocial and LivingSocial B.V.

A copy of the Share Purchase Agreement was attached as Exhibit 2.1 to the Company's Form 8-K filed on November 7, 2013 and a copy of Amendment No.1 to the Share Purchase Agreement was attached as Exhibit 2.1 to the Company's Form 8-K filed on November 29, 2013. The Company entered into Amendment No.2 to the Share Purchase Agreement on January 1, 2014, a copy which is attached to this Current Report on Form 8-K as Exhibit 2.1 and incorporated herein by reference.

Item 3.02. Unregistered Sales of Equity Securities.

The information contained in Item 2.01 is hereby incorporated into this Item 3.02. In accordance with the Share Purchase Agreement, as amended, a portion of the consideration to be delivered to the former stockholders of LS Korea consists of shares of the Company's Class A common stock. These shares of the Company's Class A common stock will be issued pursuant to exemptions from registration provided by Section 4(2) and/or Regulation D and/or Regulation S of the 1933 Securities Act, as amended.

Item 7.01. Regulation FD Disclosure.

            On January 2, 2014, the Company posted a series of questions and answers regarding the Acquisition to the Company’s Investors Relations website.  A copy of the document is attached as Exhibit 99.2 to this Current Report on Form 8-K.

             This information shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.

Item 9.01. Financial Statements and Exhibits.

(a) Financial statements of businesses acquired.

The unaudited condensed consolidated financial statements of LivingSocial Korea, Inc. as of September 30, 2013 and for the nine months ended September 30, 2013 and 2012 and the related notes thereto are filed as Exhibit 99.3 hereto.

The audited consolidated financial statements of LivingSocial Korea, Inc. as of December 31, 2012 and 2011 and for the year ended December 31, 2012 and the period from July 1, 2011 (inception) through December 31, 2011 and the related notes thereto are filed as Exhibit 99.4 hereto.

The audited consolidated financial statements of Ticket Monster Inc. for the period from January 1, 2011 through September 16, 2011 and for the period from February 1, 2010 (inception) through December 31, 2010 and the related notes thereto are filed as Exhibit 99.5 hereto.

(b) Pro forma financial information.

The unaudited pro forma condensed combined consolidated financial statements of Groupon, Inc. and LivingSocial Korea, Inc. as of and for the nine months ended September 30, 2013 and for the year ended December 31, 2012 and the related notes thereto are filed as Exhibit 99.6 hereto.

(d) Exhibits.

Exhibit No.	Description
2.1	Amendment No. 2 to the Share Purchase Agreement, dated as of January 1, 2014, among Groupon, Inc., Groupon Trailblazer, Inc., LivingSocial, Inc. and LivingSocial, B.V.
23.1	Consent of Samil PricewaterhouseCoopers, Independent Auditor of LivingSocial Korea, Inc. and Ticket Monster Inc.
99.1	Press Release Dated January 2, 2014.
99.2	Questions and Answers regarding the Acquisition of LivingSocial Korea, Inc.
99.3	Unaudited condensed consolidated financial statements of LivingSocial Korea, Inc. as of September 30, 2013 and for the nine months ended September 30, 2013 and 2012 and the related notes thereto.
99.4	Audited consolidated financial statements of LivingSocial Korea, Inc. as of December 31, 2012 and 2011 and for the year ended December 31, 2012 and the period from July 1, 2011 (inception) through December 31, 2011 and the related notes thereto.
99.5	Audited consolidated financial statements of Ticket Monster Inc. for the period from January 1, 2011 through September 16, 2011 and for the period from February 1, 2010 (inception) through December 31, 2010 and the related notes thereto.
99.6	Unaudited pro forma condensed combined consolidated financial statements of Groupon, Inc. and LivingSocial Korea, Inc. as of and for the nine months ended September 30, 2013 and for the year ended December 31, 2012 and the related notes thereto.

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 hereunto duly authorized.

	GROUPON, INC.
Dated: January 2, 2014	By:	/s/ Jason E. Child
	Name:	Jason E. Child
	Title:	Chief Financial Officer

Exhibit Index

Exhibit No.	Description
2.1	Amendment No. 2 to the Share Purchase Agreement, dated as of January 1, 2014, among Groupon, Inc., Groupon Trailblazer, Inc., LivingSocial, Inc. and LivingSocial, B.V.
23.1	Consent of Samil PricewaterhouseCoopers, Independent Auditor of LivingSocial Korea, Inc. and Ticket Monster Inc.
99.1	Press Release Dated January 2, 2014.
99.2	Questions and Answers regarding the Acquisition of LivingSocial Korea, Inc.
99.3	Unaudited condensed consolidated financial statements of LivingSocial Korea, Inc. as of September 30, 2013 and for the nine months ended September 30, 2013 and 2012 and the related notes thereto.
99.4	Audited consolidated financial statements of LivingSocial Korea, Inc. as of December 31, 2012 and 2011 and for the year ended December 31, 2012 and the period from July 1, 2011 (inception) through December 31, 2011 and the related notes thereto.
99.5	Audited consolidated financial statements of Ticket Monster Inc. for the period from January 1, 2011 through September 16, 2011 and for the period from February 1, 2010 (inception) through December 31, 2010 and the related notes thereto.
99.6	Unaudited pro forma condensed combined consolidated financial statements of Groupon, Inc. and LivingSocial Korea, Inc. as of and for the nine months ended September 30, 2013 and for the year ended December 31, 2012 and the related notes thereto.

EX-2.1

Exhibit 2.1

AMENDMENT NO. 2 TO SHARE PURCHASE AGREEMENT

This Amendment No. 2 to SHARE PURCHASE AGREEMENT (this "Amendment") has been entered into as of January 1, 2014, by and among LivingSocial, Inc., a Delaware corporation ("LivingSocial"), LivingSocial, B.V., a Netherlands limited liability company ("Seller"), Groupon, Inc., a Delaware corporation ("Parent"), and Groupon Trailblazer, Inc.,a Delaware corporation ("Buyer"). LivingSocial, Seller, Parent, and Buyer are sometimes referred to herein as the "Parties" and each, individually, as a "Party".

Recitals

A.    Reference is made to that certain Share Purchase Agreement dated as of November 6, 2013, as amended by Amendment No. 1 thereto, dated November 26, 2013 (the "Share Purchase Agreement"), by and among the Parties.

B.    Pursuant to Section 9.10 of the Share Purchase Agreement, the Parties desire to amend, restate and supplement certain provisions set forth in the Share Purchase Agreement.

C.    All capitalized terms used, but not otherwise defined, herein shall have the meanings ascribed thereto in the Share Purchase Agreement.

NOW, THEREFORE, the Parties hereto agree as follows:

Amendment

1.The following definitions shall be inserted into Section 1.1 of the Share Purchase Agreement in the proper alphabetical order:

""Prospectus" has the meaning ascribed thereto in the Underwriting Agreement."

""Underwriting Agreement" shall mean the proposed underwriting agreement among LivingSocial, Parent and Morgan Stanley & Co., LLC."

2.A new Section 4.2(d) is hereby added to the Share Purchase Agreement as follows:

(d)    Not intending to limit the foregoing, after the Closing Date but subject to the execution of the Underwriting Agreement and the filing of the Prospectus, LivingSocial shall:

(i)    (A) provide reasonable access upon reasonable advance notice at reasonable times during normal business hours to the information necessary to support Parent's preparation and completion by March 31, 2014 of audited consolidated financial statements of LS Korea, the Company and its Subsidiaries for the year ended December 31, 2013, as Parent may reasonably request, and (B) provide reasonable access upon reasonable advance notice at reasonable times during normal business hours to LivingSocial personnel who will cooperate with Parent personnel and auditors, as applicable, with respect to the preparation and completion of such financial statements; and

(ii)    provide as soon as practicable, but in no case later than January 31, 2014: (A) information and supporting documentation relied upon by LivingSocial to substantiate the value of the LivingSocial shares held by LS Korea as required by law, as of the date of receipt by LS Korea (in connection with the acquisition of the Company by LivingSocial and LS Korea), and (B) information and supporting documentation reasonably required for Parent to perform a formula-based calculation, under Korean Tax requirements, of the value of the LivingSocial shares held by LS Korea, as of the date of disposal by LS Korea, and (C) to the extent any valuations of LivingSocial have been performed on or around the date such LivingSocial shares were received by LS Korea or disposed of by LS Korea, LivingSocial shall use reasonable efforts to secure access to such valuation reports from its third party valuation consultant.

3.The following sentence is hereby added to the end of Section 4.15(d) of the Share Purchase Agreement:

"All incremental expenses (including reasonable attorney and auditor fees) incurred by Parent specifically attributable to the underwritten sale of the Parent Shares under the Underwriting Agreement shall be borne by the Selling Stockholder, up to an aggregate maximum of $300,000; provided that Parent shall pay $75,000 worth of such expenses ("Parent Share of Expenses". Prior to the Closing, Parent shall provide the Selling Stockholder estimates of all such underwriting

Exhibit 2.1

expenses, which aggregate estimated underwriting expenses shall reduce the Closing Cash Payment, except that the Parent Share of Expenses shall not reduce the Closing Cash Payment. Following the Closing, Parent shall provide reasonable documentation to the Selling Stockholder evidencing the final amount of all such underwriting expenses, and Parent and the Selling Stockholder then shall reconcile and promptly pay the amounts, if any, owing to one another for such final underwriting expenses."

4.The second sentence of Section 4.15(n) of the Share Purchase Agreement is hereby amended and restated in its entirety to read as follows:

"Notwithstanding the foregoing, Seller will be permitted to sell in a single trading day more than ten percent (10%) of the ADTV; provided that such sales are carried out (i) by means of block trades of Parent Shares that in the aggregate are valued at least at One Hundred Million U.S. Dollars ($100,000,000) (or such lesser amount equal to the value of the Parent Shares actually delivered if Parent does not deliver Parent Shares valued at least at One Hundred Million U.S. Dollars ($100,000,000) pursuant to Section 2.2(a)(ii)), or (ii) pursuant to the Underwriting Agreement; provided further that (x) any such block trades made pursuant to subsection (i) are executed by JP Morgan Chase, Morgan Stanley or another dealer agreed to in advance by Parent and Seller, at a discount of no more than five percent (5%) to Parent’s prevailing share price at the time of such trade and Parent shall reasonably cooperate in any such sale, and (y) Parent shall reasonably assist and cooperate in any diligence efforts and trades to be made pursuant to the Underwriting Agreement, including by making its executive officers available for diligence interviews with Morgan Stanley and its counsel, entering into a lock-up for the reasonable period required by Morgan Stanley, causing its directors and officers to enter into a lock-up for the reasonable period required by Morgan Stanley, and executing and complying with the terms of the Underwriting Agreement."

5.Except as specifically set forth herein, the Share Purchase Agreement shall remain in full force and effect, and its provisions shall be binding on the Parties thereto. References in the Share Purchase Agreement or in any other document to the Share Purchase Agreement shall refer to the Share Purchase Agreement, as amended hereby.

6.This Amendment may be executed in one or more counterparts, all of which shall be considered one and the same instrument and shall become effective when one or more counterparts have been signed by each Party and delivered to the other Parties. Each counterpart may be delivered by facsimile transmission or e‑mail (as a .pdf, .tif or similar uneditable attachment), which transmission shall be deemed delivery of an originally executed counterpart hereof.

7.THIS AMENDMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE, WITHOUT REGARD TO THE CONFLICTS OF LAWS RULES THEREOF.

[Signature page follows]

Exhibit 2.1

IN WITNESS WHEREOF, the undersigned have executed this Amendment No. 2 to Share Purchase Agreement as of the date first above written.

SELLER:

LIVINGSOCIAL, B.V.

By: /s/ Timothy O'Shaughnessy

Name: Timothy O'Shaughnessy

Title: Director A

By: /s/ Siti Strijbosch

Name: Siti Strijbosch

Title: Director B

LIVINGSOCIAL:

LIVINGSOCIAL, INC.

By: /s/ Timothy O'Shaughnessy

Name: Timothy O'Shaughnessy

Title: Chief Executive Officer

BUYER:

GROUPON TRAILBLAZER, INC.

By:/s/ Jason Harinstein

Name: Jason Harinstein

Title: Senior Vice President

PARENT:

GROUPON, INC.

By:/s/ Jason Harinstein

Name: Jason Harinstein

Title: Senior Vice President

EX-23.1

Exhibit 23.1

CONSENT OF INDEPENDENT ACCOUNTANTS

We hereby consent to the incorporation by reference in the Registration Statement on Form S-8 (No. 333-181854 and 333-177799) of Groupon, Inc. of our reports dated December 23, 2013 relating to the financial statements of LivingSocial Korea, Inc. and Ticket Monster Inc., which appear in the Current Report on Form 8-K of Groupon, Inc. dated January 2, 2014.

/s/ Samil PricewaterhouseCoopers

Seoul, Korea

January 2, 2014

EX-99.1

Exhibit 99.1

Groupon Completes Acquisition of Ticket Monster

CHICAGO – Groupon (NASDAQ: GRPN) today announced it has completed the acquisition of Ticket Monster, a leading Korean ecommerce company, for $260 million in cash and stock.

As previously disclosed, the Ticket Monster brand and leadership team will remain in place and continue to be led by Daniel Shin, CEO of Ticket Monster. The company will maintain its headquarters in Seoul, where it employs approximately 1,000 employees.

As announced on November 7, 2013, Groupon has acquired LivingSocial Korea, Inc., the holding company that owns Ticket Monster. LivingSocial Korea's Malaysian subsidiary was divested prior to close and is not part of this transaction.

Per the terms of the agreement, the final allocation paid to LivingSocial, Inc. was $100 million in cash and $160 million in Groupon Class A common stock, subject to registration rights.

For the nine months ended September 30, 2013, LivingSocial Korea, Inc., excluding its Malaysian subsidiary, had gross billings of $572.7 million, revenue of $78.5 million, an operating loss of $38.7 million, and Adjusted EBITDA of $0.7 million.

For more information, visit Groupon's Investor Relations page at investor.groupon.com.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of Groupon securities in any state or jurisdiction in which such offer, solicitation, or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.

Non-GAAP Financial Measures

In addition to financial results reported in accordance with U.S. generally accepted accounting principles (U.S. GAAP), we have provided Adjusted EBITDA, a non-GAAP financial measure, in this release. This non-GAAP financial measure is presented to aid investors in better understanding the performance of the business that we acquired and to facilitate comparisons to many of its peers who present similar measures. However, this measure is not intended to be a substitute for measures reported in accordance with U.S. GAAP. This measure may be different from non-GAAP financial measures used by other companies, even when similar terms are used to identify such measures.

Groupon defines Adjusted EBITDA as net income (loss) excluding income taxes, interest and other non-operating items, depreciation and amortization, stock-based compensation, and acquisition-related expense (benefit), net. We exclude depreciation and amortization and stock-based compensation from this measure because they are primarily non-cash in nature and we believe that non-GAAP financial measures excluding these items provide meaningful supplemental information about operating performance and liquidity. We exclude other non-operating items and acquisition-related expense (benefit), net because we believe that non-GAAP financial measures excluding these items provide meaningful supplemental information about core operating performance and facilitate comparisons to historical operating results.

Exhibit 99.1

The following table reconciles the Adjusted EBITDA of LivingSocial Korea, Inc., excluding its Malaysian subsidiary that we did not acquire, to its Net Loss, which is the most applicable financial measure under U.S. GAAP, for the nine months ended September 30, 2013 (in thousands):

Adjusted EBITDA	$	682
Adjustments:
Stock-based compensation	(25,887		)
Acquisition-related expense (benefit), net	—
Depreciation and amortization	(13,470		)
Non-operating items:
Other expense, net	(514		)
Provision (benefit) for income taxes	—
Net Loss	$	(39,189	)

About Groupon

Groupon (NASDAQ: GRPN) is a global leader of local commerce and the place you start when you want to buy just about anything, anytime, anywhere. By leveraging the company’s global relationships and scale, Groupon offers consumers a vast marketplace of unbeatable deals all over the world. Shoppers discover the best a city has to offer on the web or on mobile with Groupon Local, enjoy vacations with Groupon Getaways, and find a curated selection of electronics, fashion, home furnishings and more with Groupon Goods. Groupon is redefining how traditional small businesses attract, retain and interact with customers by providing merchants with a suite of products and services, including customizable deal campaigns, credit card payment processing capabilities, and point-of-sale solutions that help businesses grow and operate more effectively. To search for great deals or subscribe to Groupon emails, visit www.Groupon.com. To download Groupon's five-star mobile apps, visit www.groupon.com/mobile. To learn more about the company’s merchant solutions and how to work with Groupon, visit www.GrouponWorks.com.

Media Contact

Groupon

Bill Roberts, 312-459-5191

billr@groupon.com

EX-99.2

Exhibit 99.2

What is the strategic rationale for the Ticket Monster ("TMON") acquisition?

TMON is a great fit for Groupon and was attractive to us for many reasons -

• Korea is one of the world’s largest economies, with a healthy and growing e-commerce sector and one of the world’s highest mobile penetration rates. The acquisition allows us to solidify a market-leading position in one of the world’s largest e-commerce markets.

• TMON has been successful building what we have been working to build, with a strong brand, scale, and rapid topline growth, a truly mobile marketplace, with approximately half of billings driven by mobile, and their own Pull marketplace, with little reliance on email.

• They have a strong management team with a track record of success, which will add nice depth to the Groupon team.

• Their product suite closely aligns with our own, across product, local, and travel.

• Overall, TMON will become the anchor of our Asian business, bringing scale, innovation, and e-commerce expertise to our existing operations.

What synergies are you anticipating as a result of the TMON acquisition?

Now that the transaction has closed, we will begin formally implementing our integration plans. As TMON is already a highly efficient operation, we do not anticipate material cost synergies.

How many employees does TMON have? Do you have retention mechanisms in place for critical talent?

TMON has about 1,000 employees, all of whom became Groupon employees effective immediately upon the close of the transaction. We are confident we will retain key talent.

What initial reactions have you seen or heard from customers and merchants? Do you expect any attrition?

TMON is one of the leading brands in Korea. Their relationships with customers and merchants will not be impacted as a result of this transaction, so we are not anticipating material changes.

What is TMON’s product mix?

Approximately 65% goods, 20-25% local, the remainder travel.

Why are TMON’s take rates lower than Groupon's take rates? Is there an opportunity to increase them?

TMON’s business mix is more heavily weighted toward product than that of Groupon. The margins of the product business are lower than their other businesses, similar to what we see in Groupon Goods. TMON’s margins also reflect the fact that the Korean market is a uniquely competitive market. We will work with TMON to continue to strengthen their business, but keep in mind that during the nine months ended September 30, 2013, they were able to reach breakeven on an Adjusted EBITDA basis, despite lower take rates.

Does TMON recognize revenue on a gross or a net basis?

The large majority of TMON’s revenue is recognized on a net basis (the revenue in the “Products” line on their P&L is recorded on a gross, or direct basis, the remainder is third-party and is recorded on a net basis). As with our own business, we will evaluate ways to do more deals on a direct basis over time.

Will you close Groupon’s Korea office?

With the transaction having just closed, we have now officially kicked off integration. No changes to our operations at this time.

How do we reconcile between your commentary that TMON is about breakeven on an Adjusted EBITDA basis, and the nearly $40 million operating loss reported for the nine months ended September 30, 2013?

Of the $38.7 million operating loss for the nine months ended September 30, 2013 (for LivingSocial Korea excluding the Malaysian subsidiary not acquired), $25.9 million is stock-based compensation, and $13.5 million is depreciation and amortization. Both of these non-cash items are excluded in Groupon’s calculation of Adjusted EBITDA. Excluding these items, LivingSocial Korea’s Adjusted EBITDA was close to breakeven. The full reconciliation of LivingSocial Korea’s net loss to Adjusted EBITDA is included in the press release issued today.

Why does Groupon view this as an attractive acquisition, when it would have negatively impacted your bottom line by $42 million for the nine-month period ended September 30, 2013?

Part of the loss is related to the amortization of intangible assets acquired, including trade names, subscriber and merchant relationships, and developed technology. These intangible assets are expected to be amortized on a straight-line basis over their useful lives, which range from 2 to 5 years. Until fully amortized, they will negatively impact our bottom line. In addition, a significant portion of LivingSocial Korea’s operating loss is related to stock-based compensation. Excluding these non-cash items, the company was about breakeven on an Adjusted EBITDA basis. This is quite an accomplishment for a company that is not yet

1

Exhibit 99.2

4 years old. As the company continues to grow, we expect that it will begin to contribute to Groupon’s Adjusted EBITDA growth, which we believe is a useful measure of the financial health of the business.

How many shares will you issue in connection with the transaction? How long is LivingSocial required to hold them?

We issued 13.8 million of Class A common shares in connection with the acquisition of TMON. This was calculated based on the average closing price of GRPN stock for the 10 trading days immediately prior to close.

The shares issued to LivingSocial are subject to registration rights. On January 3, 2014, we intend to file a registration statement for the shares issued to LivingSocial, pursuant to which LivingSocial will have the ability to sell their shares immediately, based on pre-agreed trading limits, if they so choose. LivingSocial may sell up to 10% of Groupon’s average daily trading volume (measured over the previous five trading days) per day in the open market. They may also arrange for block trades or for an underwritten sale of the shares without regard to this volume limitation, in the manner specified in the Share Purchase Agreement, as amended, filed with the SEC.

Any plans to increase your share repurchase program to offset the dilutive impact of the new shares?

No changes to announce related to the existing $300 million share repurchase authorization, which expires in August 2015.

Any changes to your guidance as a result of the transaction closing so close to the end of the quarter?

Our fourth quarter of 2013 included some costs related to the transaction. Outside of these costs, the acquisition had no impact on the fourth quarter. We are not updating or affirming the guidance that we gave on the earnings call on November 7, 2013.

How will your external reporting change as a result of this acquisition?

We do not currently have plans to change our segment reporting. We are always evaluating the best way to provide appropriate transparency into our business and will inform you of any expected changes.

Please direct additional questions to ir@groupon.com. The most commonly asked questions will either be posted here or addressed in connection with the company’s fourth quarter earnings call in February. Thank you.

Note on Forward-Looking Statements

This document contains forward-looking statements within the meaning of the ''safe harbor'' provisions of the Private Securities Litigation Reform Act of 1995. These statements are based on the current expectations and beliefs of the Company's management and are subject to a number of factors and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. The forward-looking statements contained herein include statements regarding the acquisition of Ticket Monster and other agreements with Ticket Monster and its employees, including the share purchase agreement. These statements are not guarantees of future performance, involve certain risks, uncertainties and assumptions that are difficult to predict, and are based upon assumptions as to future events that may not prove accurate. Therefore, actual outcomes and results may differ materially from what is expressed herein. The following factors, among others, could cause actual results to differ materially from those described in the forward-looking statements: the risk that Groupon may not realize the anticipated benefits of the Ticket Monster acquisition, the risk that the Company may not retain the customer, merchant and vendor relationships of Ticket Monster, the inability to retain key employees of Ticket Monster, and the inability to successfully integrate the acquired technologies or operations. Groupon urges you to refer to the factors included under the headings ''Risk Factors'' and ''Management's Discussion and Analysis of Financial Condition and Results of Operations'' in the company's Annual Report on Form 10-K and subsequent Quarterly Reports on Form 10-Q, copies of which may be obtained by visiting the company's Investor Relations web site at http://investor.groupon.com or the SEC's web site at www.sec.gov.

Groupon's actual results could differ materially from those predicted or implied and reported results should not be considered an indication of future performance. You should not rely upon forward-looking statements as predictions of future events. Although Groupon believes that the expectations reflected in the forward-looking statements are reasonable, it cannot guarantee that the future results, levels of activity, performance or events and circumstances reflected in the forward-looking statements will be achieved or occur. Moreover, neither the company nor any other person assumes responsibility for the accuracy and completeness of the forward-looking statements. The forward-looking statements reflect Groupon's expectations as of January 2, 2014. Groupon undertakes no obligation to update publicly any forward-looking statements for any reason after the date of this release to conform these statements to actual results or to changes in its expectations.

2

EX-99.3

Exhibit 99.3

LivingSocial Korea, Inc.

Unaudited Condensed Consolidated Financial Statements

For the nine months ended

September 30, 2013 and 2012

LivingSocial Korea, Inc.

Index

For the nine months ended September 30, 2013 and 2012

_____________________________________________________________________________________

Unaudited Condensed Consolidated Financial Statements	Page(s)
Unaudited Condensed Consolidated Balance Sheets	1
Unaudited Condensed Consolidated Statements of Operations	2
Unaudited Condensed Consolidated Statements of Comprehensive Loss	3
Unaudited Condensed Consolidated Statements of Cash Flows	4
Notes to Unaudited Condensed Consolidated Financial Statements	5-12

LivingSocial Korea, Inc.

Unaudited Condensed Consolidated Balance Sheets

As of September 30, 2013 and December 31, 2012

_____________________________________________________________________________________

(in thousands, except unit data)			As of			As of
			September 30,			December 31,
			2013			2012
Assets
Current assets
	Cash and cash equivalents		$	15,133		$	11,109
	Accounts receivable, net		12,322			12,188
	Other current assets		5,021			2,535
		Total current assets	32,476			25,832
Property and equipment, net			5,976			5,182
Intangible assets, net			40,960			52,359
Other noncurrent assets			1,435			3,030
Goodwill			50,685			50,557
		Total assets	$	131,532		$	136,960
Liabilities and Stockholder's Equity
Current liabilities
	Accounts payable		$	8,105		$	5,256
	Merchants payable		66,153			44,219
	Accrued expenses		15,120			29,750
	Due to related parties		16,920			21,886
	Other current liabilities		807			472
		Total current liabilities	107,105			101,583
Other noncurrent liabilities			5,069			3,857
		Total liabilities	112,174			105,440
Commitments and contingencies (Note 9)
Stockholder's equity
Share capital (1,413,593 units (₩5,000 par value) outstanding at September 30, 2013 and December 31, 2012)			288,475			276,113
Accumulated deficit			(169,159		)	(128,989		)
Investment of shares in Parent, at cost			(99,403		)	(115,439		)
Accumulated other comprehensive loss			(555		)	(165		)
		Total stockholder's equity	19,358			31,520
		Total liabilities and stockholder's equity	$	131,532		$	136,960

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements

1

LivingSocial Korea, Inc.

Unaudited Condensed Consolidated Statements of Operations

Nine Months Ended September 30, 2013 and 2012

_____________________________________________________________________________________

(in thousands)		Nine Months Ended
		September 30,
		2013			2012
Revenue
Deals		$	77,398		$	48,524
Products		1,638			2,297
Other		2,029			1,065
	Total revenue	81,065			51,886
Operating expenses
Costs of revenue (exclusive of depreciation and amortization)		20,187			18,596
Costs of goods sold (exclusive of depreciation and amortization)		1,145			1,247
Marketing expenses		13,567			14,866
Selling, general and administrative expenses		72,230			73,949
Depreciation and amortization		13,470			30,081
	Total operating expenses	120,599			138,739
	Operating loss	(39,534		)	(86,853		)
Interest expense, net		(870		)	(1,072		)
Other income, net		234			1,530
	Net loss from continuing operations before benefit from income taxes	(40,170		)	(86,395		)
Benefit from income taxes		—			(8,273		)
	Net loss	$	(40,170	)	$	(78,122	)

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements

2

LivingSocial Korea, Inc.

Unaudited Condensed Consolidated Statements of Comprehensive Loss

For the nine months ended September 30, 2013 and 2012

_____________________________________________________________________________________________

(in thousands)	Nine Months Ended
	September 30,
	2013			2012
Net loss	$	(40,170	)	$	(78,122	)
Other comprehensive income (loss)
Foreign currency translation adjustments	(555		)	3,102
Comprehensive loss	$	(40,725	)	$	(75,020	)

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements

3

LivingSocial Korea, Inc.

Unaudited Condensed Consolidated Statements of Cash Flows

For the nine months ended September 30, 2013 and 2012

_____________________________________________________________________________________________

(in thousands)		Nine Months Ended
		September 30,
		2013			2012
Operating activities
Net cash provided by operating activities		$	10,607		$	(209	)
Investing activities
Purchases of property and equipment and capitalized software		(2,175		)	(2,664		)
Cash received from sale of business and assets		318			—
Acquisitions of businesses, net of acquired cash		—			608
Change in restricted cash		—			401
Net cash used in investing activities		(1,857		)	(1,655		)
Financing activities
Net proceeds (repayments) on parent working capital loan		(4,966		)	7,303
Payment to acquire remaining shares of noncontrolling interest		—			(400		)
Payment of deferred consideration		—			(425		)
Net cash provided by (used in) financing activities		(4,966		)	6,478
Effect of exchange rate changes on cash and cash equivalents		240			992
	Net increase in cash and cash equivalents	4,024			5,606
Cash and cash equivalents
Beginning of period		11,109			6,044
End of period		$	15,133		$	11,650

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements

4

LivingSocial Korea, Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

For the nine months ended September 30, 2013 and 2012

_____________________________________________________________________________________

1.    Summary of Business

LivingSocial Korea, Inc. ("LivingSocial-Korea" or the "Company"), through its wholly-owned subsidiary Ticket Monster Inc. ("TicketMonster") is a provider of e-commerce deals, primarily in the Republic of Korea.

The Company's business consists of "Deals," "Products" and other offerings. The Company uses email, the Internet, mobile devices, social networks and other forms of media to promote its offerings. Deals represent discounted goods and services offered to the Company’s subscribers on behalf of its merchant partners, who are responsible for providing the product or service to the consumer. Products represent tangible goods sold directly to subscribers, where the Company is the primary obligor.

The Company was established by LivingSocial, Inc. ("LivingSocial" or the "Parent") on July 1, 2011 solely to acquire and hold the assets of TicketMonster (see Note 3).

Liquidity and Capital Resources

Since its inception in 2011, the Company has incurred significant losses from operations. As of September 30, 2013, the Company had cash and cash equivalents of $15.1 million and a working capital deficit of $74.6 million. Since its inception, the Company has relied on its Parent for funding its working capital requirements. In November 2013, the Parent entered into an agreement to sell the Company to Groupon, Inc.; the sale is expected to close in January 2014.

The accompanying unaudited condensed consolidated financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates continuity of operations, realization of assets and satisfaction of liabilities in the ordinary course of business. The propriety of using the going concern basis is dependent upon, among other things, the achievement of future profitable operations and the ability to generate sufficient cash from operations and potential other funding sources to meet the Company's obligations as they become due. The Company's operating assumptions and projections reflect management's best estimates of future operating activity; however, these assumptions and projections are subject to risks and uncertainties. The ability to generate cash flow from operations in the future will be subject to general economic, financial, competitive, and other factors, many of which are beyond the Company's control. Management believes the going concern basis is appropriate for the accompanying unaudited condensed consolidated financial statements based on its current operating plan into 2014. In addition, management has the intent and ability to take additional actions to continue as a going concern.

2.    Summary of Significant Accounting Policies

Principles of Consolidation and Basis of Presentation

The Company has prepared the unaudited condensed consolidated financial statements in accordance with accounting principles generally accepted in the United States ("U.S. GAAP") for interim financial information and consistent with Article 10 of Regulation S-X. The accompanying unaudited condensed consolidated financial statements include the accounts of the Company and its majority owned and controlled subsidiaries. All intercompany transactions and balances between the Company and its subsidiaries have been eliminated, and net income not attributable to the Company has been allocated to noncontrolling interests when material.

The accompanying unaudited condensed consolidated financial statements include all of the relevant assets, liabilities, revenues and expenses attributable to LivingSocial-Korea's operations. These financial statements do not include any corporate assets or liabilities of LivingSocial which cannot be specifically identifiable to LivingSocial-Korea. LivingSocial allocates certain general and administrative costs of the corporate function to the Company. These services include finance and accounting, executive office, compensation and benefits management, insurance, legal, tax planning and audit, and treasury, and are allocated using methods based on benefits provided to the Company.

5

LivingSocial Korea, Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

For the nine months ended September 30, 2013 and 2012

_____________________________________________________________________________________

In the opinion of management, the unaudited condensed consolidated financial statements reflect all normal recurring adjustments that the Company considers necessary for the fair statement of its results of operations and cash flows for the interim periods covered and of the financial position of the Company at the date of the interim unaudited condensed consolidated balance sheet. The year-end condensed consolidated balance sheet at December 31, 2012 was derived from audited consolidated financial statements, but does not include all disclosures required by U.S. GAAP.  The operating results for interim periods are not necessarily indicative of the operating results for the entire year. Certain information and footnote disclosures normally included in consolidated financial statements prepared in accordance with U.S. GAAP have been condensed or omitted in accordance with the rules and regulations of the U.S. Securities and Exchange Commission.

Foreign Currency

The Company's functional and reporting currency is the United States dollar. The functional currencies of the Company's wholly owned subsidiaries are their local currencies. Assets and liabilities of the Company's foreign subsidiaries are translated into United States dollars based on exchange rates at the end of the reporting period. Income and expense items are translated at the average exchange rates prevailing during the reporting period. Translation adjustments for subsidiaries that have not been sold, substantially liquidated or otherwise disposed of, are accumulated in other comprehensive income (loss), a component of stockholder's equity. Foreign currency translation adjustments are the sole component of accumulated other comprehensive income (loss) at September 30, 2013 and December 31, 2012. Foreign currency transaction gains and losses, excluding gains and losses on intercompany balances where there is no current intent to settle such amounts in the foreseeable future, are included in the determination of net loss, and were approximately $0.6 million in net losses and $1.1 million in net gains for the nine months ended September 30, 2013 and 2012, respectively.

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses during the reporting period. In the accompanying unaudited condensed consolidated financial statements, estimates are used for, but not limited to, stock-based compensation, allowance for doubtful accounts, income taxes, acquired goodwill and intangible assets and their useful lives, recoverability of goodwill and other long-lived assets, refunds, contra revenue, loyalty rewards, contingent liabilities, corporate expense allocations, and the depreciable lives of fixed assets. Actual results could differ materially from those estimates.

Restricted Cash

The Company's restricted cash balances as of September 30, 2013 and December 31, 2012 were $0.1 million, related primarily to letters of credit for facility leases and other collateral related to payment processing. Restricted cash is included in "Other noncurrent assets" in the accompanying unaudited condensed consolidated balance sheets.

Comprehensive Income (Loss) and Accumulated Other Comprehensive Income (Loss)

Comprehensive income (loss) includes the total of the Company's net income (loss) and all other changes in equity other than transactions with owners, including changes in equity for cumulative translation adjustments resulting from the consolidation of foreign subsidiaries that use their local currency as the functional currency. Effective January 1, 2012, the Company adopted ASU 2011-05, Comprehensive Income (Topic 220): Presentation of Comprehensive Income (ASU 2011-05). As a result, the Company now presents a separate statement of comprehensive income (loss). The adoption of ASU 2011-05 did not affect the Company's consolidated results of operations, financial position, or liquidity.

Revenue Recognition

The Company recognizes revenue principally from (i) Deals, (ii) Products and (iii) other service offerings.  Revenue is recognized when the following criteria are met: persuasive evidence of an arrangement exists; delivery has occurred; the

6

LivingSocial Korea, Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

For the nine months ended September 30, 2013 and 2012

_____________________________________________________________________________________

selling price is fixed or determinable; and collectability is reasonably assured. Any cash payments received from revenue transactions are recorded as deferred revenue until all of the criteria have been met. The Company's deferred revenue balances include amounts from all types of revenue sources. Deferred revenue was $0.04 million and $0.1 million as of September 30, 2013 and December 31, 2012, respectively, and is included in "Other current liabilities" in the accompanying unaudited condensed consolidated balance sheets.

Deals

For Deals, the customer is the merchant. The revenue recognition criteria are met when the Company has fulfilled its obligations to the merchant typically by electronically delivering the voucher to the subscriber and providing the purchaser list to the merchant. Under certain Deals arrangements, the Company is obligated to (i) provide subscriber delivery information to the merchant or (ii) deliver the products to the subscriber on behalf of the merchant; in these situations the revenue recognition criteria are satisfied when the required obligations are met.  The Company's Deal merchants assume the contractual risks, which include providing the goods or service and the risk of unsold inventory. As such, all Deals transactions are recorded at the net commission amount, which is the amount charged to the subscriber less the amount to be paid to the merchant and any applicable taxes and net of estimated refunds.

Under certain Deals arrangements, the Company pays the merchant on a redemption model, whereby the merchant is paid based on vouchers redeemed as opposed to vouchers sold. If a subscriber does not redeem a voucher under these agreements, the Company retains the entire initial purchase value of the voucher including the amount that would have been payable to the merchant if the deal had been redeemed, to the extent permitted by local laws and regulations. The Company records revenue from unredeemed vouchers, less any applicable taxes, and derecognizes the related liability only when the Company is legally released from its obligation, which the Company deems to be the later of (i) the expiration of the paid and promotional value of the voucher and (ii) final payment to the merchant to the extent permitted by local law.

Products

For Products, the revenue recognition criteria are met when the goods are shipped and title passes to the subscriber, which is the customer in a Products arrangement. Product sales represent revenue from the gross selling price of products and related shipping fees, net of promotional discounts and returns allowances. In these transactions, the Company is the primary obligor, is subject to inventory risk, and has latitude in establishing prices.

Other

The Company's Other revenues are derived primarily from advertising arrangements with third parties.  Revenue from advertising sales is recognized as advertising services are provided to the Company’s customers. 

Contra-revenue

The Company makes payments through arrangements with merchants. Payments to merchants are generally recorded as contra-revenue unless the Company receives in return a specifically identifiable benefit and the fair value of such benefit is determinable and measurable. If a benefit can be identified with a determinable and measurable fair value, the payment is recorded as marketing expense up to the fair value of the benefit.

Subscriber Loyalty Programs

The Company's loyalty programs allow its subscribers to earn credits that can be redeemed for future purchases of Deals or Products. Subscriber credits are provided to existing subscribers for performing qualifying acts. A qualifying act is when a subscriber performs an action, such as providing the Company a new subscriber referral, and the subscriber is made aware of the credits prior to the performance of the action. Upon issuance of the subscriber credits following a qualifying act, the value of subscriber credits is allocated between marketing expense or contra-revenue, based upon an estimate of whether such credits will be used by a subscriber in a Deals or Products transaction. If credits are issued for a specific revenue

7

LivingSocial Korea, Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

For the nine months ended September 30, 2013 and 2012

_____________________________________________________________________________________

transaction, the value of the subscriber credit is recorded consistent with the underlying revenue transaction. Unredeemed subscriber credits are recorded at the Company’s ultimate cost of such credits in accrued liabilities. The cost of expired credits is reversed against the initial marketing expense or revenue amounts in the period of expiration.

The Company also issues promotional credits in subscriber acquisition and other marketing campaigns, where the recipient of the credits is not required to perform any qualifying acts. Upon redemption, the value of promotional credits is recorded as either marketing expense or contra-revenue, dependent upon how the underlying revenue transaction is recorded (Deals or Products, respectively).

Subscriber Refunds

At the time revenue is recorded, the Company records an accrual for estimated refunds primarily based on the Company's historical experience with refunds.  Refunds are recorded as a reduction of revenue.  The liability for refunds is adjusted as appropriate as actual refund activity occurs. The Company routinely evaluates its assumptions used to estimate its subscriber refund accrual based on developments in refund and expiration patterns, subscriber contract changes, and other factors.

Marketing Expenses

Marketing expenses consist primarily of subscriber acquisition costs. Marketing payroll and benefit costs, including related stock-based compensation expense, are also classified as marketing expense. The Company records these costs when incurred. For the nine months ended September 30, 2013 and 2012, advertising costs were $0.8 million and $3.8 million, respectively.

Stock-Based Compensation

Stock-based compensation is classified in the accompanying unaudited condensed consolidated statements of operations in a manner consistent with the statements of operations' classification of an employee's salary and benefits, as follows:

	Nine Months Ended
(in thousands)	September 30,
	2013		2012
Marketing expenses	$	—	$	1,166
Selling, general and administrative expenses	25,887		27,337
	25,887		28,503
Capitalized stock-based compensation	—		254
Total stock-based compensation	$	25,887	$	28,757

Recent Accounting Pronouncements

In 2013, Financial Accounting Standards Board ("FASB") issued new accounting guidance clarifying the accounting for the release of cumulative translation adjustment into net income when a parent either sells a part or all of its investment in a foreign entity or no longer holds a controlling financial interest in a subsidiary or group of assets that is a nonprofit activity or a business within a foreign entity. This new guidance is effective for fiscal years, and interim periods within those fiscal years, beginning on or after December 15, 2013. The Company does not anticipate that this adoption will have a significant impact on the Company’s financial position, results of operations or cash flows.

8

LivingSocial Korea, Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

For the nine months ended September 30, 2013 and 2012

_____________________________________________________________________________________

In 2013, FASB also issued new accounting guidance requiring disclosure of items reclassified from other comprehensive income (loss) to net income. This guidance is effective for periods beginning after December 15, 2012. The adoption of this standard did not have a significant impact on the Company's financial position, results of operations or cash flows.

3.    Intangible Assets and Goodwill

Intangible Assets

Amortization expense for definite lived intangible assets was approximately $11.3 million and $28.6 million for the nine months ended September 30, 2013 and 2012, respectively. The weighted average remaining amortization period of intangible assets is 6.3 years as of September 30, 2013. 

Goodwill

Given that a significant component of goodwill is related to the Company's expected future growth, the Company closely monitors its results and projections.  If the long-term financial forecasts deteriorate and/or other indicators of impairment are present, the Company could be required to recognize impairment losses on the carrying value of the goodwill in future periods.

There were no goodwill impairment losses or measurement period adjustments during the nine months ended September 30, 2013 and 2012. The change in the carrying amount of goodwill during the nine months ended September 30, 2013 reflects the effect of changes in foreign currency exchange rates.

4.    Related Parties - relationship with LivingSocial, Inc.

LivingSocial provides certain executive office and other administrative services to the Company and allocates the fair value of such services to the Company, when material. For each of the nine month periods ended September 30, 2013 and 2012 approximately $1.6 million of strategic management costs were allocated based on the business unit's pro rata share of revenue.

As of September 30, 2013 and December 31, 2012, the Company has intercompany loans with LivingSocial to support working capital requirements, with balances of approximately $16.9 million and $21.9 million, respectively. The loans have stated terms and conditions, including stated interest rates equal to the one-year LIBOR rate plus 350 basis points compounded on a daily basis, and are expected to be collected and repaid, as appropriate, within one year. The total interest paid to LivingSocial in the nine-months ended September 30, 2013 and 2012 was $1.3 million and $0.2 million, respectively.

In connection with the Company's acquisition of TicketMonster in 2011, LivingSocial contributed 27.9 million shares of its common stock, with an estimated fair value of $195.0 million, to the Company to be used for both purchase consideration and post-acquisition compensation purposes. These shares have been reported in the Company's consolidated balance sheets as Investment in shares of Parent. In connection with the transfer of these shares and the acquisition of TicketMonster, the Company also entered into intercompany loans with LivingSocial in the amount of $167.4 million, which are reported in the Company's consolidated balance sheets as Share Capital. As a result of the final working capital adjustment, the Company repaid $0.6 million of this loan in 2012.

5.    Accrued Expenses

The Company made cash payments of approximately $2.4 million and $15.3 million in 2012 and the period ended September 30, 2013, respectively, for retention bonuses related to the 2011 TicketMonster acquisition.

9

LivingSocial Korea, Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

For the nine months ended September 30, 2013 and 2012

_____________________________________________________________________________________

6.    Stock-Based Compensation

The Company uses LivingSocial common stock for various forms of stock-based awards, including but not limited to stock options and restricted stock, to compensate its employees and directors for future service.

Stock Options

A summary of stock option activity during the nine months ended September 30, 2013 is presented below:

					Weighted-
			Weighted-Average Exercise Price		Average
					Remaining
					Contractual	Aggregate
	Stock Options				Life (in years)	Intrinsic Value
Outstanding at December 31, 2012	2,836,536		$	0.35	9.89	$	—
Granted	660,450		0.35			—
Exercised	(5,625	)	0.35			—
Forfeited	(409,441	)	0.35			—
Outstanding at September 30, 2013	3,081,920		$	0.35	9.26	$	—
Vested/Exercisable at September 30, 2013	164,284		$	0.35	8.73	$	—

During the nine months ended September 30, 2013, the weighted average fair value of stock options granted was $0.07. Stock-based compensation during the nine months ended September 30, 2013 and 2012 was approximately $0.1 million and $0.06 million, respectively, from stock options.

As of September 30, 2013, unrecognized stock-based compensation, net of estimated forfeitures, relating to unvested stock options was approximately $0.5 million, which is scheduled to be recognized as stock-based compensation over a weighted-average period of 2.8 years. To the extent the actual forfeiture rate is different than what the Company has anticipated compensation related to these options will be different from its expectations.

Restricted Stock

A summary of restricted stock activity during the nine months ended September 30, 2013 is presented below:

	Shares of Restricted Stock		Weighted- Average Grant Date Fair Value
Outstanding at December 31, 2012	16,457,359		$	7.00
Granted	—		—
Vested	(1,110,955	)	$	7.00
Forfeited	(1,157,928	)	$	7.00
Outstanding at September 30, 2013	14,188,476		$	7.00

Stock-based compensation was $25.8 million and $28.7 million during the nine months ended September 30, 2013 and 2012, respectively, related to restricted stock.

As of September 30, 2013, there was $33.9 million of unrecognized stock-based compensation related to restricted stock, which is scheduled to be recognized as compensation over a weighted-average period of 1.0 years.

10

LivingSocial Korea, Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

For the nine months ended September 30, 2013 and 2012

_____________________________________________________________________________________

Common Stock Valuations

Given the lack of an active public market for the Parent's common stock, the Company determined the fair value per share of the common stock underlying the stock-based awards through contemporaneous valuations as authorized by the Parent's board of directors, third-party transactions in the Parent's stock, or management's best estimate of fair value based upon recent transactions and valuations.

7.    Fair Value

Fair value is the price that would be received from the sale of an asset or paid to transfer a liability assuming an orderly transaction in the most advantageous market at the measurement date. U.S. GAAP establishes a hierarchical disclosure framework which prioritizes and ranks the level of observability of inputs used in measuring fair value.

Assets and Liabilities Measured at Fair Value on a Recurring Basis

Short-term Financial Instruments

The inputs used in measuring the fair value of cash equivalents are considered to be Level 1 in accordance with the three-tier fair value hierarchy. The fair market values are based on quoted prices in active markets at period-end supplied by the various banks and brokers that held the majority of the Company's funds.

Other Instruments

The Company has no other financial instruments or nonfinancial assets or liabilities that are measured at fair value on a recurring basis.

Assets Measured at Fair Value on a Nonrecurring Basis

The Company measures its long-lived assets, including property and equipment, goodwill and other intangible assets, at fair value on a nonrecurring basis. These assets are recognized at fair value when they are deemed to be impaired.

8.    Income Taxes

The Company accounts for income taxes using the asset and liability approach, which requires the recognition of future tax benefits or liabilities on the temporary differences between the financial reporting and tax bases of its assets and liabilities. A valuation allowance is established when necessary to reduce deferred tax assets to the amounts expected to be realized. For interim periods, the Company recognizes an income tax provision (benefit) based on its estimated annual effective tax rate expected for the entire year. The Company's benefit for income taxes was $8.3 million for the nine months ended September 30, 2012 and none in 2013. As of September 30, 2013 and December 31, 2012 the Company had recognized a full valuation allowance against its net deferred tax assets.

The Company also recognizes a tax benefit from uncertain tax positions only if it is "more likely than not" that the position is sustainable based on its technical merits. The Company's policy is to recognize interest and penalties on uncertain tax positions as a component of income tax expense.

9.    Commitments and Contingencies

From time to time the company is party to certain litigation or other legal proceedings arising in the ordinary course of business.  Because of the uncertainties inherent in litigation, the company cannot predict the outcome of such litigation or other legal proceedings; however, the company believes that none of these matters are probable or estimable at this time. Accordingly, the Company has not recorded an accrual for any possible losses in its financial statements.

11

LivingSocial Korea, Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

For the nine months ended September 30, 2013 and 2012

_____________________________________________________________________________________

10.    Subsequent Events

The Company has performed an evaluation of subsequent events through the date the accompanying financial statements were available and issued.

During November 2013, the Company entered into a definitive agreement to sell its Korean subsidiaries to an affiliate of Groupon, Inc. for $260 million in cash and stock. The agreement is for at least $100 million in cash and up to $160 million in the Class A common stock of Groupon, Inc., with the final cash and stock allocation to be determined prior to close.

The transaction is expected to close in January 2014, subject to customary closing conditions. As part of the transaction, all shares of LivingSocial common stock that were to be earned by and distributed to TicketMonster employees pursuant to the Company's 2011 acquisition of TicketMonster will be distributed at closing, and all outstanding options to acquire LivingSocial's common stock held by TicketMonster employees will terminate. Additionally, in conjunction with the transaction, LivingSocial will purchase from the Company 100% of its Malaysian subsidiary.

12

EX-99.4

Exhibit 99.4

LivingSocial Korea, Inc.

Consolidated Financial Statements

For the Year Ended December 31, 2012 and from Date of Inception (July 1, 2011) through December 31, 2011

LivingSocial Korea, Inc.

Index

For the Year Ended December 31, 2012 and from Date of Inception (July 1, 2011) through December 31, 2011

_____________________________________________________________________________________

Audited Consolidated Financial Statements	Page(s)
Independent Auditor's Report	1
Consolidated Balance Sheets	2
Consolidated Statements of Operations	3
Consolidated Statements of Comprehensive Loss	4
Consolidated Statements of Cash Flows	5-6
Consolidated Statements of Stockholder's Equity	7
Notes to Consolidated Financial Statements	8-26

Independent Auditor's Report

To the Board of Directors and Stockholder of LivingSocial Korea, Inc.

We have audited the accompanying consolidated financial statements of LivingSocial Korea, Inc. and its subsidiaries, which comprise the consolidated balance sheets as of December 31, 2012 and 2011, and the related consolidated statements of operations, comprehensive loss, stockholder's equity and cash flows for the year ended December 31, 2012 and for the period from date of inception (July 1, 2011) through December 31, 2011.

Management's Responsibility for the Consolidated Financial Statements

Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.

Auditor's Responsibility

Our responsibility is to express an opinion on the consolidated financial statements based on our audits. We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the consolidated financial statements. The procedures selected depend on our judgment, including the assessment of the risks of material misstatement of the consolidated financial statements, whether due to fraud or error. In making those risk assessments, we consider internal control relevant to the Company's preparation and fair presentation of the consolidated financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of LivingSocial Korea, Inc. and its subsidiaries at December 31, 2012 and 2011, and the results of their operations and their cash flows for the year ended December 31, 2012 and for the period from date of inception (July 1, 2011) through December 31, 2011 in accordance with accounting principles generally accepted in the United States of America.

/s/ Samil PricewaterhouseCoopers

Seoul, Korea

December 23, 2013

1

LivingSocial Korea, Inc.

Consolidated Balance Sheets

As of December 31, 2012 and 2011

_____________________________________________________________________________________

(in thousands, except unit data)			As of			As of
			December 31,			December 31,
			2012			2011
Assets
Current assets
	Cash and cash equivalents		$	11,109		$	6,044
	Accounts receivable, net		12,188			9,473
	Other current assets		2,535			2,020
		Total current assets	25,832			17,537
Property and equipment, net			5,182			3,232
Intangible assets, net			52,359			80,024
Other noncurrent assets			3,030			1,794
Goodwill			50,557			46,561
		Total assets	$	136,960		$	149,148
Liabilities and Stockholders' Equity
Current liabilities
	Accounts payable		$	5,256		$	8,411
	Merchants payable		44,219			23,352
	Accrued expenses		29,750			4,082
	Due to related party		21,886			15,067
	Other current liabilities		472			620
		Total current liabilities	101,583			51,532
Deferred tax liability, net			—			7,971
Other noncurrent liabilities			3,857			6,944
		Total liabilities	105,440			66,447
Commitments and contingencies (Note 11)
Stockholder's equity
Share capital (1,413,593 units (₩5,000 par value) outstanding at December 31, 2012 and 2011)			276,113			239,050
Accumulated deficit			(128,989		)	(33,570		)
Investment in shares of Parent, at cost			(115,439		)	(118,627		)
Accumulated other comprehensive loss			(165		)	(4,152		)
		Total stockholder's equity	31,520			82,701
		Total liabilities and stockholder's equity	$	136,960		$	149,148

The accompanying notes are an integral part of these consolidated financial statements

2

LivingSocial Korea, Inc.

Consolidated Statements of Operations

For the Year Ended December 31, 2012 and from Date of Inception (July 1, 2011) through December 31, 2011

______________________________________________________________________________________________________

(in thousands)					Period from
		Twelve Months Ended			Date of Inception through
		December 31,			December 31,
		2012			2011
Revenue
Deals		$	71,101		$	11,769
Products		3,300			—
Other		2,449			446
	Total revenue	76,850			12,215
Operating expenses
Costs of revenue (exclusive of depreciation and amortization)		25,032			5,545
Costs of goods sold (exclusive of depreciation and amortization)		1,808			—
Marketing expenses		19,803			9,601
Selling, general and administrative expenses		101,002			22,817
Depreciation and amortization		34,653			11,859
Acquisition related		—			975
	Total operating expenses	182,298			50,797
	Operating loss	(105,448		)	(38,582		)
Interest expense, net		(1,370		)	(217		)
Other (expense) income, net		3,125			(526		)
	Net loss before benefit from income taxes	(103,693		)	(39,325		)
Benefit from income taxes		(8,274		)	(5,755		)
	Net loss	$	(95,419	)	$	(33,570	)

The accompanying notes are an integral part of these consolidated financial statements

3

LivingSocial Korea, Inc.

Consolidated Statements of Comprehensive Loss

For the Year Ended December 31, 2012 and from Date of Inception (July 1, 2011) through December 31, 2011

_____________________________________________________________________________________

(in thousands)				Period from
	Year Ended			Date of Inception through
	December 31,			December 31,
	2012			2011
Net loss	$	(95,419	)	$	(33,570	)
Other comprehensive income (loss)
Foreign currency translation adjustments	3,987			(4,152		)
Comprehensive loss	$	(91,432	)	$	(37,722	)

The accompanying notes are an integral part of these consolidated financial statements

4

LivingSocial Korea, Inc.

Consolidated Statements of Cash Flows

For the Year Ended December 31, 2012 and from Date of Inception (July 1, 2011) through December 31, 2011

_____________________________________________________________________________________

(in thousands)							Period from
				Year Ended			Date of Inception through
				December 31			December 31,
				2012			2011
Operating activities
Net loss				$	(95,419	)	$	(33,570	)
Adjustments to reconcile net loss to net cash provided by operating activities
	Depreciation and amortization			34,653			11,859
	Unrealized foreign currency transaction gains			(941		)	(33		)
	Change in fair value of contingent consideration			—			(3,619		)
	Stock-based compensation			37,984			9,286
	Deferred tax benefit			(8,545		)	(6,000		)
	Provision for refunds and loyalty awards			23,061			1,309
	Change in assets and liabilities:
		Accounts receivable		(1,829		)	(7,065		)
		Prepaid expenses and other current assets		(1,545		)	386
		Other non current assets		(1,339		)	1,444
		Accounts payable		(1,349		)	4,033
		Accrued expenses		17,367			382
		Other liabilities		(2,590		)	6,861
Net cash provided by (used in) operating activities				(492		)	(14,727		)
Investing activities
Purchases of property and equipment and capitalized software				(3,274		)	(1,487		)
Cash paid for business acquisition, net of cash acquired				608			(24,277		)
Change in restricted cash				321			—
Net cash provided by (used in) investing activities				(2,345		)	(25,764		)
Financing activities
Net proceeds on parent working capital loan				7,760			14,092
Investment by Parent				—			32,625
Payment to acquire remaining shares of noncontrolling interest				(400		)	—
Payment of deferred consideration				(541		)	—
Net cash provided by financing activities				6,819			46,717
Effect of exchange rate changes on cash and cash equivalents				1,083			(182		)
			Net increase in cash and cash equivalents	5,065			6,044
Cash and cash equivalents
Beginning of period				6,044			—
End of period				$	11,109		$	6,044

The accompanying notes are an integral part of these consolidated financial statements

5

Non-cash investing and financing activities
Issuance of Parent common stock for acquisition	$	(2,567	)	$	(76,337	)
Parent loan contributed to capital, net	$	(590	)	$	167,388
Capitalized stock-based compensation	$	290		$	—
Supplemental cash flow information
Cash paid for interest	$	345		$	—

The accompanying notes are an integral part of these consolidated financial statements

6

LivingSocial Korea, Inc.

Consolidated Statements of Stockholder's Equity

For the Year Ended December 31, 2012 and from Date of Inception (July 1, 2011) through December 31, 2011

_____________________________________________________________________________________

(in thousands)	Share capital			Investment in shares of Parent			Accumulated deficit			Accumulated other comprehensive income (loss)			Total stockholder's equity
Balance at inception	$	—		$	—		$	—		$	—		$	—
Net loss	—			—			(33,570		)	—			(33,570		)
Parent shares contributed	29,751			(194,964		)	—			—			(165,213		)
Initial contribution of cash from Parent	32,625			—			—			—			32,625
Parent shares delivered to purchase TMON	—			76,337			—			—			76,337
Foreign currency translation	—			—			—			(4,152		)	(4,152		)
Parent loan contributed to capital, net	167,388			—			—			—			167,388
Stock-based compensation	9,286			—			—			—			9,286
Balance at December 31, 2011	$	239,050		$	(118,627	)	$	(33,570	)	$	(4,152	)	$	82,701
Net loss	—			—			(95,419		)	—			(95,419		)
Parent shares forfeited	(621		)	621			—			—			—
Parent shares delivered to purchase TMON	—			2,567			—			—			2,567
Foreign currency translation	—			—			—			3,987			3,987
Return of contribution to Parent	(590		)	—			—			—			(590		)
Stock-based compensation	38,274			—			—			—			38,274
Balance at December 31, 2012	$	276,113		$	(115,439	)	$	(128,989	)	$	(165	)	$	31,520

The accompanying notes are an integral part of these consolidated financial statements

7

LivingSocial Korea, Inc.

Notes to Consolidated Financial Statements

For the Year Ended December 31, 2012 and from Date of Inception (July 1, 2011) through December 31, 2011

_____________________________________________________________________________________

1.    Summary of Business

LivingSocial Korea, Inc. ("LivingSocial-Korea" or the "Company"), through its wholly-owned subsidiary Ticket Monster Inc. ("TicketMonster") is a provider of e-commerce deals, primarily in the Republic of Korea.

The Company's business consists of "Deals," "Products" and other offerings. The Company uses email, the Internet, mobile devices, social networks and other forms of media to promote its offerings. Deals represent discounted goods and services offered to the Company's subscribers on behalf of its merchant partners, who are responsible for providing the product or service to the consumer. Products represent tangible goods sold directly to subscribers, where the Company is the primary obligor.

The Company was established by LivingSocial, Inc. ("LivingSocial" or the "Parent") on July 1, 2011 and acquired TicketMonster (see Note 3) on September 16, 2011. The accompanying consolidated financial statements are presented for the period from the date of inception (July 1, 2011) through December 31, 2011, or the "2011 Period") and for the year ended December 31, 2012.

Liquidity and Capital Resources

Since its inception in 2011, the Company has incurred significant losses from operations. As of September 30, 2013, the Company had cash and cash equivalents of $15.1 million (unaudited) and had a working capital deficit of $74.6 million (unaudited). The Company has relied on its Parent for funding its working capital requirements. In November 2013, the Parent entered into an agreement to sell the Company to Groupon, Inc., and the sale is expected to close in January 2014.

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates continuity of operations, realization of assets and satisfaction of liabilities in the ordinary course of business. The propriety of using the going concern basis is dependent upon, among other things, the achievement of future profitable operations and the ability to generate sufficient cash from operations and potential other funding sources to meet the Company's obligations as they become due. The Company's operating assumptions and projections reflect management's best estimates of future operating activity; however, these assumptions and projections are subject to risks and uncertainties. The ability to generate cash flow from operations in the future will be subject to general economic, financial, competitive, and other factors, many of which are beyond the Company's control. Management believes the going concern basis is appropriate for the accompanying consolidated financial statements based on its current operating plan into 2014. In addition, management has the intent and ability to take additional actions to continue as a going concern.

2.    Summary of Significant Accounting Policies

Principles of Consolidation and Basis of Presentation

The Company has prepared the consolidated financial statements in accordance with accounting principles generally accepted in the United States ("U.S. GAAP"). The accompanying consolidated financial statements include the accounts of the Company and its majority owned and controlled subsidiaries. All intercompany transactions and balances between the Company and its subsidiaries have been eliminated, and net income not attributable to the Company has been allocated to noncontrolling interests when material.

The accompanying consolidated financial statements include all of the relevant assets, liabilities, revenues and expenses attributable to LivingSocial-Korea's operations. These financial statements do not include any corporate assets or liabilities of LivingSocial which cannot be specifically identifiable to LivingSocial-Korea. LivingSocial allocates certain general and administrative costs of the corporate function to the Company. These services include finance and accounting, executive

8

LivingSocial Korea, Inc.

Notes to Consolidated Financial Statements

For the Year Ended December 31, 2012 and from Date of Inception (July 1, 2011) through December 31, 2011

_____________________________________________________________________________________

office, compensation and benefits management, insurance, legal, tax planning and audit, and treasury, and are allocated using methods based on benefits provided to the Company.

Foreign Currency

The Company's functional and reporting currency is the United States dollar. The functional currency of its wholly owned subsidiaries is the subsidiaries' local currency. Assets and liabilities of subsidiaries are translated into United States dollars based on exchange rates at the end of the reporting period. Income and expense items are translated at the average exchange rates prevailing during the reporting period. Translation adjustments for subsidiaries that have not been sold, substantially liquidated or otherwise disposed of are accumulated in other comprehensive income (loss), a component of stockholder's equity. Foreign currency translation adjustments are the sole component of accumulated other comprehensive loss at December 31, 2012 and 2011. Foreign currency transaction gains and losses, excluding gains and losses on intercompany balances where there is no current intent to settle such amounts in the foreseeable future, are included in the determination of net loss. The gains associated with foreign currency transactions were approximately $2.2 million and $0.01 million for the year ended December 31, 2012 and the 2011 Period, respectively.

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses during the reporting period. In the accompanying consolidated financial statements, estimates are used for, but not limited to, stock-based compensation, allowance for doubtful accounts, income taxes, acquired goodwill and intangible assets and their useful lives, recoverability of goodwill and other long-lived assets, refunds, contra revenue, loyalty rewards, contingent consideration, contingent liabilities, corporate expense allocations, and the depreciable lives of fixed assets. Actual results could differ materially from those estimates.

Fair Value

The consolidated balance sheets include various financial instruments (primarily cash equivalents, contingent consideration, and deferred consideration) that are recorded at fair value. Fair value is the price that would be received from the sale of an asset or paid to transfer a liability assuming an orderly transaction in the most advantageous market at the measurement date. The Company's financial instruments that are not carried at fair value include restricted cash, prepaid expenses and other current assets, deposits, accounts receivable, accounts payable, merchants payable, accrued expenses, and other current liabilities. The carrying value of these assets and liabilities approximate their fair values due to their short-term nature. U.S. GAAP establishes a hierarchical disclosure framework which prioritizes and ranks the level of observability of inputs used in measuring fair value. These tiers include:

Level 1 defined as observable inputs such as quoted prices in active markets for identical assets;

Level 2 defined as observable inputs other than Level 1 prices such as quoted prices for similar assets; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities; and

Level 3 defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions.

See Note 9 for additional information regarding fair value.

9

LivingSocial Korea, Inc.

Notes to Consolidated Financial Statements

For the Year Ended December 31, 2012 and from Date of Inception (July 1, 2011) through December 31, 2011

_____________________________________________________________________________________

Concentrations of Credit Risk

Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of cash and cash equivalents and accounts receivable. While the Company maintains its cash and cash equivalents with financial institutions with high credit ratings, it often maintains these deposits in federally insured financial institutions in excess of federally insured limits. Accounts receivable include funds owed to the Company by a limited number of payment processors.

Cash, Cash Equivalents and Restricted Cash

The Company considers all highly liquid investments with original maturities of three months or less to be cash equivalents. The cash and cash equivalents balances at December 31, 2012 and 2011 consisted of cash deposited in institutional money market mutual funds and regular interest bearing and noninterest bearing depository accounts with commercial banks.

The Company's restricted cash balances as of December 31, 2012 and 2011 were $0.1 million and $0.4 million, respectively, related primarily to letters of credit for facility leases and other collateral related to payment processing. Restricted cash is included in "Other noncurrent assets" in the accompanying consolidated balance sheets.

Accounts Receivable

Accounts receivable primarily represents the net cash due from the Company's credit card and other payment processors for cleared transactions as well as cash due from merchants. When necessary, the carrying amount of the Company's receivables is reduced by an allowance for doubtful accounts that reflects management's best estimate of amounts that will not be collected. The allowance is based on historical experience and specific risks identified in collection matters. The Company's allowance for doubtful accounts was $1.8 million and $0.4 million at December 31, 2012 and December 31, 2011, respectively.

Property and Equipment

Property and equipment is carried at cost less accumulated depreciation. Depreciation is calculated using the straight-line method over the following estimated useful lives:

Computer equipment	1-3 years
Office furniture and equipment	3-7 years
Software	3 years
Leasehold improvements	shorter of useful life or remaining lease term

The Company periodically reviews the depreciation method, useful lives and estimated salvage value of its property and equipment and revises those estimates as necessary. Repairs and maintenance costs are expensed as incurred.

Internally Developed Software

Costs related to the design or maintenance of internally developed software are expensed as incurred. Costs incurred in the application development stage to develop software applications for internal use are capitalized and amortized over the estimated useful lives of the software once placed in service. The Company capitalized $1.0 million of costs associated with internally developed software in the year ended December 31, 2012 (none in the 2011 Period). Amortization of capitalized amounts was $0.1 million in 2012.

10

LivingSocial Korea, Inc.

Notes to Consolidated Financial Statements

For the Year Ended December 31, 2012 and from Date of Inception (July 1, 2011) through December 31, 2011

_____________________________________________________________________________________

Inventory

Inventory is primarily accounted for using the specific identification method. Inventory is valued using direct costs of the products, along with allocated overhead costs when material, and is carried at the lower of cost or current market value. Selling expenses, which do not include shipping and overhead, are reported as period costs and are excluded from inventory costs. Inventory is classified as "Other current assets" on the consolidated balance sheets.

Intangible Assets

Intangible assets are definite lived intangible assets generated from business combinations and are carried at cost less accumulated amortization. Amortization is calculated over the estimated useful lives (see Note 3). The Company applies an accelerated method of amortization to reflect an estimated pattern of economic benefit received from the subscriber relationships intangible asset. The remaining intangible assets are amortized using the straight-line method over their estimated useful lives as patterns of economic benefit cannot be reliably determined.

Impairment of Long-lived Assets

The Company assesses its long-lived assets for impairment when indicators of potential impairment are present. If impairment indicators are present, recoverability of assets is measured by comparing the carrying values of the assets to the future undiscounted cash flows expected to be generated by the assets. Any impairment loss would be measured as the excess of the assets' carrying values over their fair values. Fair value is based on market prices, when available, or the use of various other valuation techniques, including discounted cash flows.

Impairment of Goodwill

Goodwill is the excess of the acquisition cost of businesses over the fair value of the identifiable net assets acquired. Impairment testing for goodwill assigned to the Company's sole reporting unit is performed annually on October 1 or more frequently if indicators of potential impairment exist. When the Company performs its impairment test, it first assesses qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If based on this assessment the Company determines it is more likely than not that the fair value of the reporting unit is less than its carrying amount, then performing the two-step impairment test is necessary. The first step of the goodwill impairment test examines whether the carrying value of a reporting unit exceeds its fair value. If the carrying value of the reporting unit exceeds its fair value, the second step of the test requires the Company to then compare the implied fair value of that reporting unit's goodwill with the carrying value of its goodwill to determine the amount of impairment charge, if any. Fair value is based on market prices, when available, or the use of various valuation techniques.

Comprehensive Income (Loss) and Accumulated Other Comprehensive Income (Loss)

Comprehensive income (loss) includes the total of the Company's net income (loss) and all other changes in equity other than transactions with owners, including changes in equity for cumulative translation adjustments resulting from the consolidation of foreign subsidiaries as the financial statements of the subsidiaries are accounted for using the local currency as the functional currency. Effective January 1, 2012, the Company adopted ASU 2011-05, Comprehensive Income (Topic 220): Presentation of Comprehensive Income (ASU 2011-05). As a result, the Company now presents a separate statement of comprehensive income (loss). The adoption of ASU 2011-05 did not affect the Company's consolidated results of operations, financial position, or liquidity.

11

LivingSocial Korea, Inc.

Notes to Consolidated Financial Statements

For the Year Ended December 31, 2012 and from Date of Inception (July 1, 2011) through December 31, 2011

_____________________________________________________________________________________

Revenue Recognition

The Company recognizes revenue principally from (i) Deals, (ii) Products and (iii) other service offerings.  Revenue is recognized when the following criteria are met: persuasive evidence of an arrangement exists; delivery has occurred; the selling price is fixed or determinable; and collectability is reasonably assured. Any cash payments received from revenue transactions are recorded as deferred revenue until all of the criteria have been met. The Company's deferred revenue balances include amounts from all types of revenue sources. Deferred revenue was $0.1 million and $0.3 million as of December 31, 2012 and 2011, respectively, and is included in "Other current liabilities" in the accompanying consolidated balance sheets.

Deals

For Deals, the customer is the merchant. The revenue recognition criteria are met when the Company has fulfilled its obligations to the merchant typically by electronically delivering the voucher to the subscriber and providing the purchaser list to the merchant. Under certain Deals arrangements, the Company is obligated to (i) provide subscriber delivery information to the merchant or (ii) deliver the products to the subscriber on behalf of the merchant; in these situations the revenue recognition criteria are satisfied when the required obligations are met.  The Company's Deal merchants assume the contractual risks, which include providing the goods or service and the risk of unsold inventory. As such, all Deals transactions are recorded at the net commission amount, which is the amount charged to the subscriber less the amount to be paid to the merchant and any applicable taxes and net of estimated refunds.

Under certain Deals arrangements, the Company pays the merchant on a redemption model, whereby the merchant is paid based on vouchers redeemed as opposed to vouchers sold. If a subscriber does not redeem a voucher under these agreements, the Company retains the entire initial purchase value of the voucher including the amount that would have been payable to the merchant if the deal had been redeemed, to the extent permitted by local laws and regulations. The Company records revenue from unredeemed vouchers, less any applicable taxes, and derecognizes the related liability only when the Company is legally released from its obligation, which the Company deems to be the later of (i) the expiration of the paid and promotional value of the voucher and (ii) final payment to the merchant to the extent permitted by local law.

Products

For Products, the revenue recognition criteria are met when the goods are shipped and title passes to the subscriber, which is the customer in a Products arrangement. Product sales represent revenue from the gross selling price of products and related shipping fees, net of promotional discounts and returns allowances. The Company is the primary obligor in these transactions, is subject to inventory risk, and has latitude in establishing prices.

Other

The Company's Other revenues are derived primarily from advertising arrangements with third parties.  Revenue from advertising sales is recognized as advertising services are provided to the Company's customers. 

Contra-revenue

The Company makes payments through arrangements with merchants. Payments to merchants are generally recorded as contra-revenue unless the Company receives in return a specifically identifiable benefit and the fair value of such benefit is determinable and measurable. If a benefit can be identified with a determinable and measurable fair value, the payment is recorded as marketing expense up to the fair value of the benefit.

12

LivingSocial Korea, Inc.

Notes to Consolidated Financial Statements

For the Year Ended December 31, 2012 and from Date of Inception (July 1, 2011) through December 31, 2011

_____________________________________________________________________________________

Subscriber Loyalty Programs

The Company's loyalty programs allow its subscribers to earn credits that can be redeemed for future purchases of Deals or Products. Subscriber credits are provided to existing subscribers for performing qualifying acts. A qualifying act is when a subscriber performs an action, such as providing the Company a new subscriber referral, and the subscriber is made aware of the credits prior to the performance of the action. Upon issuance of the subscriber credits following a qualifying act, the value of subscriber credits is allocated between marketing expense or contra-revenue, based upon an estimate of whether such credits will be used by a subscriber in a Deals or Products transaction. If credits are issued for a specific revenue transaction, the value of the subscriber credit is recorded consistent with the underlying revenue transaction. Unredeemed subscriber credits are recorded at the Company's ultimate cost of such credits in accrued liabilities. The cost of expired credits is reversed against the initial marketing expense or revenue amounts in the period of expiration.

The Company also issues promotional credits in subscriber acquisition and other marketing campaigns, where the recipient of the credits is not required to perform any qualifying acts. Upon redemption, the value of promotional credits is recorded as either marketing expense or contra-revenue, dependent upon how the underlying revenue transaction is recorded (Deals or Products, respectively).

Subscriber Refunds

At the time revenue is recorded, the Company records an accrual for estimated refunds primarily based on the Company's historical experience with refunds.  Refunds are recorded as a reduction of revenue.  The liability for refunds is adjusted as appropriate as actual refund activity occurs. The Company routinely evaluates its assumptions used to estimate its subscriber refund accrual based on developments in refund and expiration patterns, subscriber contract changes, and other factors.

Costs of Revenue

Costs of revenue consist primarily of editorial and production costs, which include payroll and benefit costs, including related stock-based compensation expense, email fees for delivering vouchers to subscribers, fees paid to credit card and other payment processors, shipping costs, commissions paid to delivery agents and distributor fees. The Company records these costs when incurred. In addition, when it becomes probable that a revenue contract will result in an overall loss, the expected loss is recognized as costs of revenue when such losses become evident.

Costs of Goods Sold

Costs of goods sold include the cost of Products sold to subscribers along with outbound shipping charges and allocated editorial and production costs. Editorial and production costs include payroll and benefit costs, including related stock-based compensation expense, email fees for delivering vouchers to subscribers, fees paid to credit card and other payment processors, shipping costs, commissions paid to delivery agents and distributor fees. The Company records these costs upon the sale of Products.

Marketing Expenses

Marketing expense consists primarily of subscriber acquisition costs. These include online marketing costs, such as sponsored search, advertising on social networking sites, email marketing campaigns, and subscriber loyalty programs, and to a lesser extent, offline marketing costs such as television, radio and print advertising. Marketing payroll and benefit costs, including related stock- based compensation expense, are also classified as marketing expense. The Company records these costs when incurred. For the year ended December 31, 2012 and the 2011 Period, advertising costs were $4.2 million and $3.1 million, respectively.

13

LivingSocial Korea, Inc.

Notes to Consolidated Financial Statements

For the Year Ended December 31, 2012 and from Date of Inception (July 1, 2011) through December 31, 2011

_____________________________________________________________________________________

Stock-Based Compensation

The Company uses its Parent's common stock for various forms of stock-based awards, including but not limited to stock options and restricted stock, to compensate its employees for future service. The Company accounts for stock-based compensation at fair value on the date of grant or modification, net of estimated forfeitures. The Company determines the fair value of stock options using the Black-Scholes option pricing model. The fair value of other stock-based awards is based on the valuation of the Company's common stock on the date of grant or modification (see Note 8). The fair value of an award that is ultimately expected to vest is recognized as expense on a straight-line basis over the requisite service period.

Stock-based compensation is classified in the consolidated statements of operations in a manner consistent with the statements of operations' classification of the employee's salary and benefits, as follows:

(in thousands)	Year ended December 31, 2012		Period from date of inception through December 31, 2011
Marketing expenses	$	1,187	$	434
Selling, general and administrative	36,797		8,852
Stock-based compensation expense	37,984		9,286
Capitalized stock-based compensation	290		—
Stock-based compensation	$	38,274	$	9,286

Income Taxes

The Company accounts for income taxes using the asset and liability approach. This approach requires the recognition of tax benefits or expenses on the temporary differences between the financial reporting and tax bases of the Company's assets and liabilities. A valuation allowance is established when necessary to reduce deferred tax assets to the amounts expected to be realized. The Company also recognizes a tax benefit from uncertain tax positions only if it is "more likely than not" that the position is sustainable based on its technical merits. The Company's policy is to recognize interest and penalties on uncertain tax positions as a component of income tax expense.

Recent Accounting Pronouncements

In 2013, the Financial Accounting Standards Board ("FASB") issued new accounting guidance clarifying the accounting for the release of cumulative translation adjustment into net income when a parent either sells a part or all of its investment in a foreign entity or no longer holds a controlling financial interest in a subsidiary or group of assets that is a nonprofit activity or a business within a foreign entity. This new guidance is effective for fiscal years, and interim periods within those fiscal years, beginning on or after December 15, 2013. The Company does not anticipate that this adoption will have a significant impact on the Company’s financial position, results of operations or cash flows.

In 2013, FASB also issued new accounting guidance requiring disclosure of items reclassified from other comprehensive income (loss) to net income. This guidance is effective for periods beginning after December 15, 2012. The adoption of this standard did not have a significant impact on the Company’s financial position, results of operations or cash flows.

14

LivingSocial Korea, Inc.

Notes to Consolidated Financial Statements

For the Year Ended December 31, 2012 and from Date of Inception (July 1, 2011) through December 31, 2011

_____________________________________________________________________________________

3.    Business Combinations

On September 16, 2011, the Company acquired 100% of the outstanding capital stock of TicketMonster, a company incorporated under the laws of South Korea. TicketMonster has operations in South Korea and Malaysia. TicketMonster is primarily in the business of promoting discounted goods and services to its subscribers on behalf of its local merchant partners. The Company acquired TicketMonster principally for the purpose of extending the Deals business into South Korea and Malaysia and acquiring the leadership and human capital needed to develop and expand the business in those territories. The total purchase consideration consisted of the following:

(in thousands)	Non-Contingent			Contingent		Total
	Consideration			Consideration		Consideration
Shares granted (11,272)	$	78,904		$	—	$	78,904
Cash paid at closing	26,113			—		26,113
Fair value of contingent consideration	—			3,619		3,619
Working capital adjustment	(1,643		)	—		(1,643		)
Total consideration	$	103,374		$	3,619	$	106,993

The fair values as of September 16, 2011 of shares issued as a component of the consideration and the contingent consideration were determined using a valuation analysis prepared with the assistance of a third party. The contingent consideration was payable in cash based on various financial metrics achieved by TicketMonster during the period between the closing date and December 31, 2012, up to a total maximum payment of $45.0 million. Based on financial metrics achieved by TicketMonster through December 31, 2012, the Company has determined that no payments are required to be made pursuant to this arrangement.

In addition to the purchase consideration, the Company agreed to transfer 16.5 million shares of LivingSocial's common stock to TicketMonster's founders and employees as they vest based on continued employment over the three-year period after acquisition (see Note 12), along with up to $17.7 million in cash also subject to continued employment. The Company is expensing the value of the issuable shares and the deferred cash payment as compensation expense over the post- combination period. The Company recognized approximately $38.0 million and $9.3 million of expense related to the shares during 2012 and 2011, respectively. The Company recognized approximately $13.7 million and $4.0 million of expenses related to the deferred cash payments during 2012 and 2011, respectively, of which $2.4 million, net of withholding, was paid in 2012. As of December 31, 2012, the deferred cash payment balance of $15.3 million was presented as "Accrued expenses" on the consolidated balance sheet.

The Company accounted for its acquisition of TicketMonster by recording all tangible and intangible assets acquired and liabilities assumed at their respective fair values on the acquisition date, with the remaining unallocated purchase price recorded as goodwill. The fair value assigned to identifiable intangible assets acquired was determined using an income approach for trade names, subscriber relationships and merchant relationships and a cost approach for technology. The fair values were based on the Company's estimates, including estimates for the deferred income tax liabilities, and were prepared using the assistance of a third party. The Company recognized deferred income tax assets and liabilities for the tax effects of the differences between assigned book values and tax bases of assets acquired and liabilities assumed in the acquisition. As a result, the Company recorded a net deferred income tax liability of $14.3 million.

15

LivingSocial Korea, Inc.

Notes to Consolidated Financial Statements

For the Year Ended December 31, 2012 and from Date of Inception (July 1, 2011) through December 31, 2011

_____________________________________________________________________________________

The following represents the allocation of the purchase consideration:

($ in thousands)	Estimated			Estimated
	Fair Value			Useful Life
Accounts receivable	$	2,655
Other current assets (including cash of $1,836)	3,147
Other non-current assets	5,186
Merchants payable	(20,611		)
Accounts payable	(8,388		)
Other current liabilities	(2,581		)
Other liabilities	(1,039		)
Deferred tax assets (liabilities)	(14,323		)
Intangible assets:
Technology	600			1 year
Trade name	18,200			12 years
Subscriber relationships	53,900			6 years
Merchant relationships	21,700			1 year
Goodwill	48,547
Total consideration	$	106,993

The goodwill of the acquired company is primarily related to expected sales growth from future product offerings and customers, together with certain intangible assets that do not qualify for separate recognition, including assembled workforce. None of the goodwill is deductible for tax purposes.

TicketMonster recognized approximately $76.8 million of revenue and $95.4 million of net losses in 2012 and approximately $12.2 million of revenue and $32.3 million of net losses from the acquisition date to December 31, 2011, which results are included in the accompanying consolidated financial statements. The Company expensed acquisition-related costs of approximately $1.0 million related to this acquisition in 2011.

16

LivingSocial Korea, Inc.

Notes to Consolidated Financial Statements

For the Year Ended December 31, 2012 and from Date of Inception (July 1, 2011) through December 31, 2011

_____________________________________________________________________________________

4.    Property and Equipment

(in thousands)	As of December 31,
	2012			2011
Computer equipment	$	3,357		$	1,395
Office furniture and equipment	1,269			579
Software	2,049			322
Leasehold improvements	1,304			915
Construction in progress	34			547
	8,013			3,758
Less: Accumulated depreciation and amortization	(2,831		)	(526		)
Total property and equipment, net	$	5,182		$	3,232

Depreciation and amortization expense related to property and equipment for the year ended December 31, 2012 and the 2011 Period was approximately $2.1 million and $0.3 million, respectively.

5.    Intangible Assets and Goodwill

Intangible Assets

The carrying amounts of definite lived intangible assets consist of the following:

(in thousands)	As of December 31, 2012
	Gross		Accumulated			Net
	Carrying Value		Amortization			Carrying Value
Subscriber relationships	$	56,059	$	(20,905	)	$	35,154
Merchant/customer relationships	22,569		(22,569		)	—
Trade names	18,928		(2,038		)	16,890
Technology	790		(789		)	1
Non-compete agreements	824		(510		)	314
Total other intangible assets	$	99,170	$	(46,811	)	$	52,359

17

LivingSocial Korea, Inc.

Notes to Consolidated Financial Statements

For the Year Ended December 31, 2012 and from Date of Inception (July 1, 2011) through December 31, 2011

_____________________________________________________________________________________

(in thousands)	As of December 31, 2011
	Gross		Accumulated			Net
	Carrying Value		Amortization			Carrying Value
Subscriber relationships	$	51,675	$	(4,521	)	$	47,154
Merchant/customer relationships	20,804		(6,068		)	14,736
Trade names	17,449		(424		)	17,025
Technology	727		(210		)	517
Non-compete agreements	759		(167		)	592
Total other intangible assets	$	91,414	$	(11,390	)	$	80,024

Amortization expense for definite lived intangible assets was approximately $32.5 million and $11.6 million for the year ended December 31, 2012 and the 2011 Period, respectively. The weighted average remaining amortization period of intangible assets is 6.7 years as of December 31, 2012. Estimated future amortization expense with respect to definite lived intangible assets existing at December 31, 2012, by year and in the aggregate, is as follows:

(in thousands)
Fiscal Years	Amount
2013	$ 13,957
2014	9,986
2015	9,169
2016	6,336
2017	3,563
thereafter	9,348
	$ 52,359

Goodwill

The carrying value of goodwill was $50.6 million and $46.6 million at December 31, 2012 and 2011 respectively. Given that a significant component of goodwill is related to the Company's expected future growth of its reporting units, the Company closely monitors the results and projections at each reporting unit.  If the long-term financial forecasts for these reporting units deteriorate and/or other indicators of impairment are present, the Company could be required to recognize impairment losses on the carrying value of the goodwill in future periods. The Company believes the fair value of its goodwill exceeds its carrying value at December 31, 2012 and 2011.

There were no goodwill impairment losses or measurement period adjustments during 2012 or 2011. The $4.0 million change in the carrying amount of goodwill during the year ended December 31, 2012 reflects the effect of changes in foreign currency exchange rates.

18

LivingSocial Korea, Inc.

Notes to Consolidated Financial Statements

For the Year Ended December 31, 2012 and from Date of Inception (July 1, 2011) through December 31, 2011

_____________________________________________________________________________________

6.    Accrued Expenses

The following summarizes the Company's accrued expenses as of December 31, 2012 and 2011:

(in thousands)	As of December 31,
	2012		2011
Loyalty programs	$	1,584	$	608
Refunds	3,005		179
Accrued compensation and benefits	22,927		3,295
Accrued professional fees and other	2,234		—
Total accrued expenses	$	29,750	$	4,082

7.    Related Parties - relationship with LivingSocial, Inc.

LivingSocial provides certain executive office and other administrative services to the Company and allocates the fair value of such services to the Company, when material, based on the business unit's pro rata share of revenue. For the year ended December 31, 2012 approximately $2.1 million was allocated for these services and none was allocated in 2011.

As of December 31, 2012 and 2011, the Company had intercompany loans with LivingSocial and its subsidiaries to support working capital requirements, with balances of approximately $21.9 million and $15.1 million, respectively. The loans have stated terms and conditions, including a stated interest rate equal to the one-year LIBOR rate plus 350 basis points compounded on a daily basis, and are expected to be collected and repaid, as appropriate, within one year. Approximately $0.3 million of interest was paid in 2012 and none was paid in the 2011 Period.

In connection with the Company's acquisition of TicketMonster in 2011, LivingSocial contributed 27.9 million shares of its common stock, with an estimated fair value of $195.0 million, to the Company to be used for both purchase consideration and post-acquisition compensation purposes. These shares have been reported in the Company's consolidated balance sheets as Investment in shares of Parent. In connection with the transfer of these shares and the acquisition of TicketMonster, the Company also entered into intercompany loans with LivingSocial in the amount of $167.4 million, which are reported in the Company's consolidated balance sheets as Share Capital. As a result of the final working capital adjustment, the Company repaid $0.6 million of this loan in 2012.

8.    Stock-Based Compensation

The Company uses LivingSocial common stock for various forms of stock-based awards, including but not limited to stock options and restricted stock, to compensate its employees and directors for future service.

Stock Options

Options generally become vested and exercisable over a period of four years. The term of the options is up to ten years. A summary of stock option activity during the year ended December 31, 2012 and the 2011 Period is presented below:

19

LivingSocial Korea, Inc.

Notes to Consolidated Financial Statements

For the Year Ended December 31, 2012 and from Date of Inception (July 1, 2011) through December 31, 2011

_____________________________________________________________________________________

	Stock Options		Weighted- Average Exercise Price		Weighted- Average Remaining Contractual Life (in years)	Aggregate Intrinsic Value
Outstanding at date of inception	—		—		—	—
Granted	86,999		$	7.69
Exercised	—		—
Forfeited	—		—
Outstanding at December 31, 2011	86,999		$	7.69	9.83	$	—
Granted	2,789,937		$	0.35
Exercised	—		—
Forfeited	(40,400	)	$	3.98
Outstanding at December 31, 2012	2,836,536		$	0.35	9.89	$	—
Vested/Exercisable at December 31, 2012	32,905		$	0.35	7.01	$	—
Vested and Expected to Vest	2,729,337		$	0.35	9.89	$	—

During the year ended December 31, 2012 and the 2011 Period, the weighted average fair value of stock options granted was $0.21 and $3.28, respectively. Stock-based compensation during 2012 and 2011 was approximately $0.1 million and $0.02 million, respectively, from stock options.

As of December 31, 2012, unrecognized stock-based compensation, net of estimated forfeitures, relating to unvested stock options was approximately $0.6 million, which is scheduled to be recognized as stock-based compensation over a weighted-average period of 3.5 years.

The Company uses the Black-Scholes option-pricing model to estimate the fair value of stock option grants. The determination of the fair value of stock-based compensation grants is affected by estimates of the fair value of LivingSocial's stock as well as assumptions regarding a number of variables, including stock price volatility, risk-free interest rate, and actual and projected stock option exercise behaviors. The Company estimated the fair value for these stock options at the grant date, using the following assumptions:

	2012	2011
Risk-free interest rate	0.88% - 1.56%	1.41% - 1.83%
Expected dividend yield	—	—
Expected volatility	40.4% - 46.9%	49.50%
Expected term (years)	6.25	6.25

LivingSocial does not anticipate paying dividends on common stock during the expected term of the grants; therefore, the dividend rate was assumed to be zero. Expected volatility is estimated by considering the historical volatility of similar publicly-traded companies for which share price information is available. The expected term represents the period of time the stock options are expected to be outstanding; the Company estimated the expected term using the "simplified method" as it does not have sufficient historical exercise data to provide a reasonable estimate.

20

LivingSocial Korea, Inc.

Notes to Consolidated Financial Statements

For the Year Ended December 31, 2012 and from Date of Inception (July 1, 2011) through December 31, 2011

_____________________________________________________________________________________

Restricted Stock

A summary of restricted stock activity during the year ended December 31, 2012 and for the 2011 Period is presented below:

	Shares of Restricted Stock		Weighted- Average Grant Date Fair Value
Outstanding at July 1, 2011	—		—
Granted in conjunction with TicketMonster acquisition	16,503,750		$	7.00
Outstanding at December 31, 2011	16,503,750		$	7.00
Forfeited	(46,391	)	$	7.00
Outstanding at December 31, 2012	16,457,359		$	7.00

Stock-based compensation (including amounts capitalized) was $38.2 million and $9.3 million during 2012 and 2011, respectively, related to restricted stock.

As of December 31, 2012, there was $67.8 million of unrecognized stock-based compensation related to restricted stock, which is scheduled to be recognized as compensation over a weighted-average period of 1.7 years.

Common Stock Valuations

Given the lack of an active public market for the Parent's common stock, the Company determined the fair value per share of the common stock underlying the stock-based awards through contemporaneous valuations as authorized by the Parent's board of directors, third-party transactions in the Parent's stock, or management's best estimate of fair value based upon recent transactions and valuations.

9.    Fair Value

Fair value is the price that would be received from the sale of an asset or paid to transfer a liability assuming an orderly transaction in the most advantageous market at the measurement date. U.S. GAAP establishes a hierarchical disclosure framework which prioritizes and ranks the level of observability of inputs used in measuring fair value.

Assets and Liabilities Measured at Fair Value on a Recurring Basis

Short-term Financial Instruments

The inputs used in measuring the fair value of cash equivalents are considered to be Level 1 in accordance with the three-tier fair value hierarchy. The fair market values are based on quoted prices in active markets at period-end supplied by the various banks and brokers that held the majority of the Company’s funds.

Other Financial Instruments

The inputs used in measuring the fair value of contingent consideration related to the Company’s acquisition of TicketMonster are considered to be Level 3 in accordance with the hierarchy. The fair market value of the contingent consideration was approximately $3.6 million as of the acquisition date and was determined to be $0 as of December 31, 2011 with the change being reflected in net loss. The contingency expired on December 31, 2012 without payment.

21

LivingSocial Korea, Inc.

Notes to Consolidated Financial Statements

For the Year Ended December 31, 2012 and from Date of Inception (July 1, 2011) through December 31, 2011

_____________________________________________________________________________________

Other Instruments

The Company has no other financial instruments or nonfinancial assets or liabilities that are measured at fair value on a recurring basis.

Assets Measured at Fair Value on a Nonrecurring Basis

The Company measures its long-lived assets, including property and equipment, goodwill and other intangible assets, at fair value on a nonrecurring basis. These assets are recognized at fair value when they are deemed to be impaired.

10.    Income Taxes

Domestic (Korean) and foreign components of loss from continuing operations before income taxes are presented below:

(in thousands)	Year Ended December 31, 2012			Period from Date of Inception through December 31, 2011
Domestic loss before income taxes	$	(101,658	)	$	(38,886	)
Foreign loss before income taxes	(2,035		)	(439		)
Total loss before income taxes	$	(103,693	)	$	(39,325	)

The benefit from income taxes consists of the following:

22

LivingSocial Korea, Inc.

Notes to Consolidated Financial Statements

For the Year Ended December 31, 2012 and from Date of Inception (July 1, 2011) through December 31, 2011

_____________________________________________________________________________________

(in thousands)		Year Ended December 31, 2012			Period from Date of Inception through December 31, 2011
Current income tax provision (benefit):
	Domestic	$	21		$	177
	Foreign	—			—
	Total	21			177
Deferred income tax provision (benefit):
	Domestic	(10,539		)	(6,108		)
	Foreign	(506		)	(80		)
	Total	(11,045		)	(6,188		)
Change in valuation allowance		2,750			256
Total benefit for income taxes		$	(8,274	)	$	(5,755	)

The difference between income taxes computed by applying the Korean statutory income tax rate to losses before income taxes and the benefit for income taxes is attributable to the following:

(in thousands)	Year Ended December 31, 2012			Period from Date of Inception through December 31, 2011
Expected tax provision at Korean statutory rate of 22% (2012) and 24.2% (2011)	$	(22,812	)	$	(9,517	)
Stock based compensation	8,504			2,247
Non-deductible employee bonus	3,036			970
Foreign taxes	(62		)	(3		)
Change in valuation allowance	2,750			256
Other	310			292
Total income tax benefit	$	(8,274	)	$	(5,755	)

Deferred income taxes reflect the net tax effects of differences between the bases of assets and liabilities for financial reporting and income tax purposes. The Company's deferred income tax assets and liabilities consisted of the following:

23

LivingSocial Korea, Inc.

Notes to Consolidated Financial Statements

For the Year Ended December 31, 2012 and from Date of Inception (July 1, 2011) through December 31, 2011

_____________________________________________________________________________________

(in thousands)		As of December 31,
		2012			2011
Deferred tax assets:
	Accruals and advances	$	4,528		$	1,825
	Depreciation	13			—
	Customer refunds and loyalty awards	566			129
	Net operating loss carryforward	9,848			8,063
	Other	372			10
	Total deferred tax assets	$	15,327		$	10,027
Deferred tax liabilities:
	Depreciation	$	—		$	(19	)
	Intangible assets	(11,472		)	(17,451		)
	Other	(503		)	(59		)
	Total deferred tax liabilities	$	(11,975	)	$	(17,529	)
Valuation allowance		(3,352		)	(469		)
Total deferred tax asset (liability), net		$	—		$	(7,971	)

As of December 31, 2012, the Company had domestic net operating loss carry forwards of $43 million, which begin to expire in 2020, and foreign net operating loss carry forwards of $1.6 million, which never expire. The Company is required to establish a valuation allowance for deferred tax assets if, based on the weight of available evidence, it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. The Company considers the projected future taxable income and tax planning strategies in making this assessment. In 2011 management believed that the future reversals of the TicketMonster deferred tax liability that relates to the intangibles with certain life, recorded as part of acquisition accounting, would be sufficient sources of income over the remaining net operating loss, or NOL, carryforward periods and established no valuation allowance against the deferred tax asset related to the TicketMonster NOL in 2011. However, a full valuation allowance was established against the NOL deferred tax assets of the TicketMonster subsidiaries. Based upon the level of historical taxable income and projections for future taxable income in the periods which the deferred tax assets are deductible, the Company has determined that a full valuation allowance against its net deferred tax assets is required as of December 31, 2012.

The Company is subject to income taxes in numerous jurisdictions. Significant judgment is required in evaluating the Company's tax positions and determining its provision for income taxes. The Company establishes liabilities for tax-related uncertainties based on estimates of whether, and the extent to which, additional taxes will be due. These liabilities are established when the Company believes that certain positions might be challenged despite its belief that its tax return positions are fully supportable. The Company adjusts these liabilities in light of changing facts and circumstances, such as the outcome of a tax audit. The provision for income taxes includes the impact of changes to the liability that is considered appropriate. The Company has identified no material uncertain tax positions as of December 31, 2012 and 2011.

The Company is subject to income tax audits in all jurisdictions for which it files tax returns. Tax audits by their very nature are often complex and can require several years to complete. Neither the Company nor any of its subsidiaries is currently under audit in any jurisdiction. Domestic tax audits for TicketMonster have been completed for the periods from 2010 through 2012. Domestic tax audits for the Company have been completed for the 2011 period.

24

LivingSocial Korea, Inc.

Notes to Consolidated Financial Statements

For the Year Ended December 31, 2012 and from Date of Inception (July 1, 2011) through December 31, 2011

_____________________________________________________________________________________

11.    Commitments and Contingencies

Operating Leases

The Company has entered into various non-cancelable operating lease agreements, primarily covering certain of its offices throughout the world, with original lease periods expiring between 2013 and 2014. Rent expense under these operating leases was $3.6 million and $0.9 million forthe year ended December 31, 2012 and for the 2011 Period, respectively. Certain of these arrangements have renewal or expansion options and adjustments for market provisions, such as free or escalating base monthly rental payments. The Company recognizes rent expense under such arrangements on a straight-line basis over the initial term of the lease. The difference between the straight-line expense and the cash paid for rent has been recorded as deferred rent.

At December 31, 2012, future payments under operating leases (including rent escalation clauses but excluding proportionate share of operating expenses) were as follows:

(in thousands)	Operating Leases
Years Ending December 31,
2013	$	1,144
2014	23
2015	—
2016	—
2017	—
	$	1,167

Contingencies

From time to time the Company and its subsidiaries are party to certain litigation or other legal proceedings arising in the ordinary course of business.  Because of the uncertainties inherent in litigation, the Company cannot predict the outcome of such litigation or other legal proceedings; however, the Company believes that none of these matters involve material losses that are probable or estimable at this time. Accordingly, the Company has not recorded an accrual for any possible losses in its consolidated financial statements.

12.    Subsequent Events

The Company has performed an evaluation of subsequent events through the date the accompanying consolidated financial statements were available and issued.

In November 2013, LivingSocial entered into a definitive agreement to sell the Company and certain of its subsidiaries to an affiliate of Groupon, Inc. for $260 million in cash and stock. The agreement is for at least $100 million in cash and up to $160 million in the Class A common stock of Groupon, Inc., with the final cash and stock allocation to be determined prior to close.

The transaction is expected to close in January 2014, subject to customary closing conditions. As part of the transaction, all shares of LivingSocial common stock that were to be earned by and distributed to TicketMonster employees pursuant to the Company's 2011 acquisition of TicketMonster will be distributed prior to closing, and all outstanding options to acquire the LivingSocial's common stock held by TicketMonster employees will terminate in accordance with their terms (generally upon closing for unvested options and three months after closing for vested options). Additionally, in conjunction with the transaction, LivingSocial will purchase from the Company 100% of its Malaysian subsidiary.

25

EX-99.5

Exhibit 99.5

Ticket Monster Inc.

Consolidated Financial Statements

For the Period from January 1, 2011 through September 16, 2011 and for the Period from Date of Inception (February 1, 2010) through December 31, 2010

Ticket Monster Inc.

Index

For the Period from January 1, 2011 through September 16, 2011 and from Date of Inception (February 1, 2010) through December 31, 2010

_____________________________________________________________________________________

Audited Consolidated Financial Statements	Page(s)
Report of Independent Auditors	1
Consolidated Statements of Operations	2
Consolidated Statements of Comprehensive Loss	3
Consolidated Statements of Cash Flows	4
Consolidated Statements of Changes in Redeemable Convertible Preferred Shares and Stockholders' Deficit	5
Notes to Consolidated Financial Statements	6-19

Report of Independent Auditors

To the Board of Directors and Stockholders of Ticket Monster Inc.

We have audited the accompanying consolidated statements of operations, comprehensive loss, changes in redeemable convertible preferred shares and stockholders' deficit and cash flows of Ticket Monster Inc. and its subsidiaries for the period from date of inception (February 1, 2010) through December 31, 2010 and for the period from January 1, 2011 through September 16, 2011. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits of these statements in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether these statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in these statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of these statements. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated statements referred to above present fairly, in all material respects, the results of operations and of cash flows of Ticket Monster Inc. and its subsidiaries for the period from date of inception (February 1, 2010) through December 31, 2010 and for the period from January 1, 2011 through September 16, 2011 in conformity with accounting principles generally accepted in the United States of America.

/s/ Samil PricewaterhouseCoopers

Seoul, Korea

December 23, 2013

1

Ticket Monster Inc.

Consolidated Statements of Operations

For the Period from January 1, 2011 through September 16, 2011 and for the Period from Date of Inception (February 1, 2010) through December 31, 2010

_____________________________________________________________________________________

(in thousands)		Period from January 1, 2011 through September 16, 2011			Period from Date of Inception through December 31, 2010
Deal Revenue		$	18,138		$	2,992
	Total revenue	18,138			2,992
Operating expenses
Costs of revenue		15,822			1,009
Marketing expenses		21,352			2,717
Selling, general and administrative expenses		10,861			1,594
Research and development expenses		1,324			16
	Total operating expenses	49,359			5,336
	Operating loss	(31,221		)	(2,344		)
Interest expense, net		(323		)	—
Other income (expense), net		(1,675		)	1
	Net loss before benefit from income taxes	(33,219		)	(2,343		)
Benefit from income taxes		(1,073		)	—
	Net loss	$	(32,146	)	$	(2,343	)

The accompanying notes are an integral part of these consolidated financial statements    

2

Ticket Monster Inc.

Consolidated Statements of Comprehensive Income (Loss)

For the Period from January 1, 2011 through September 16, 2011 and from Date of Inception (February 1, 2010) through December 31, 2010

_____________________________________________________________________________________

(in thousands)
	Period from January 1, 2011 through September 16, 2011			Period from Date of Inception through December 31, 2010
Net loss	$	(32,146	)	$	(2,343	)
Other comprehensive loss
Foreign currency translation adjustments	(99		)	52
Comprehensive loss	$	(32,245	)	$	(2,291	)

The accompanying notes are an integral part of these consolidated financial statements    

3

Ticket Monster Inc.

Consolidated Statements of Cash Flows

For the Period from January 1, 2011 through September 16, 2011 and from Date of Inception (February 1, 2010) through December 31, 2010

_____________________________________________________________________________________

(in thousands)
				Period from January 1, 2011 through September 16, 2011			Period from Date of inception through December 31, 2010
Operating activities
Net loss				$	(32,146	)	$	(2,343	)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities
	Depreciation and amortization			3,743			16
	Provision for accrued severance benefits			—			53
	Stock-based compensation			4,163			14
	Deferred tax benefit			1,073			—
	Provision for refunds and loyalty awards			—			316
	Changes in assets and liabilities:
		Accounts receivable		(162		)	(2,170		)
		Prepaid expenses and other current assets		497			(271		)
		Other non current assets		(1,825		)	(59		)
		Accounts payable		18,576			5,488
		Accrued expenses		695			462
		Other liabilities		(1,076		)	(75		)
Net cash provided by (used in) operating activities				(6,462		)	1,431
Investing activities
Purchases of property and equipment and capitalized software				(2,501		)	(53		)
Acquisitions of businesses, net of acquired cash				(1,184		)	(583		)
Net cash used in investing activities				(3,685		)	(636		)
Financing activities
Payment to acquire remaining shares of noncontrolling interest				(325		)	—
Proceeds from issuances of preferred stock, net of paid issuance costs				8,010			2,884
Proceed from issuance of common shares, net of issuance costs				1,183			243
Net cash provided by financing activities				8,868			3,127
Effect of exchange rate changes on cash and cash equivalents				(720		)	(87		)
			Net increase (decrease) in cash and cash equivalents	(1,999		)	3,835
Cash and cash equivalents
Beginning of period				3,835			—
End of period				$	1,836		$	3,835
Supplemental cash flow information
Cash paid for interest				$	—		$	46
Cash paid for income taxes				$	—		$	38
Issuance of deferred consideration for acquisition				$	3,697		$	2,083

The accompanying notes are an integral part of these consolidated financial statements    

4

Ticket Monster Inc.

Consolidated Statements of Changes in Redeemable Convertible Preferred Shares and Stockholders' Deficit

For the Period from January 1, 2011 through September 16, 2011 and from Date of Inception (February 1, 2010) through December 31, 2010

___________________________________________________________________________________________________________________

(in thousands, except share data)	Redeemable Convertible Preferred Shares			Common Shares			Additional Paid-In-Capital			Accumulated deficit			Accumulated other comprehensive income (loss)			Total stockholders' deficit
	Shares	Amount		Shares	Amount
Balance at inception	—	$	—	—	$	—	$	—		$	—		$	—		$	—
Net loss	—	—		—	—		—			(2,343		)	—			(2,343		)
Foreign currency translation	—	—		—	—		—			—			52			52
Issuance of common shares, net	—	—		27,590	243		—			—			—			243
Issuance of Series A preferred shares	8,530	2,884		—	—		—			—			—			—
Stock-based compensation	—	—		1,560	14		—			—			—			14
Accretion of preferred shares	—	94		—	—		(94		)	—			—			(94		)
Balance at December 31, 2010	8,530	2,978		29,150	257		(94		)	(2,343		)	52			(2,128		)
Net loss	—	—		—	—		—			(32,146		)	—			(32,146		)
Foreign currency translation	—	—		—	—		—			—			(99		)	(99		)
Issuance of common shares, net	—	—		3,411	36		1,147			—			—			1,183
Issuance of Series B preferred shares	5,380	8,010		—	—		—			—			—			—
Stock-based compensation expense	—	—		481	4		4,159			—			—			4,163
Accretion of preferred shares	—	730		—	—		(730		)	—			—			(730		)
Balance at September 16, 2011	13,910	$	11,718	33,042	$	297	$	4,482		$	(34,489	)	$	(47	)	$	(29,757	)

The accompanying notes are an integral part of these consolidated financial statements

5

Ticket Monster Inc.

Notes to Consolidated Financial Statements

For the Period from January 1, 2011 through September 16, 2011 and from Date of Inception (February 1, 2010) through December 31, 2010

_____________________________________________________________________________________

1.    Summary of Business

Ticket Monster Inc. ("TicketMonster") is a provider of e-commerce deals in the Republic of Korea. TicketMonster and its subsidiary (together, the "Company") contracts with merchants to create discount deals and markets them online to its subscribers.

The Company's business consists of "Deals," "Products" and other offerings. The Company uses email, the Internet, mobile devices, social networks and other forms of media to promote its offerings. Deals represent discounted goods and services offered to the Company's subscribers on behalf of its merchant partners, who are responsible for providing the Deal product or service to the customer. Products represent tangible goods sold directly to subscribers (product sales where the Company is the primary obligor).

The Company was established on February 1, 2010 and was acquired by LivingSocial Korea, Inc. on September 16, 2011. The period from date of inception (February 1, 2010) through December 31, 2010 is hereinafter referred to as the "2010 Period" and the period from January 1, 2011 through the date of acquisition (September 16, 2011) is hereinafter referred to as the "2011 Period."

Liquidity and Capital Resources

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates continuity of operations, realization of assets and satisfaction of liabilities in the ordinary course of business. The propriety of using the going concern basis is dependent upon, among other things, the achievement of future profitable operations and the ability to generate sufficient cash from operations and potential other funding sources to meet the Company's obligations as they become due. The Company's operating assumptions and projections reflect management's best estimates of future operating activity; however, these assumptions and projections are subject to risks and uncertainties. The ability to generate cash flow from operations in the future will be subject to general economic, financial, competitive, and other factors, many of which are beyond the Company's control. Management believes the going concern basis is appropriate for the accompanying consolidated financial statements based on its current operating plan into 2014. In addition, management has the intent and ability to take additional actions to continue as a going concern.

2.    Summary of Significant Accounting Policies

Principles of Consolidation and Basis of Presentation

The Company has prepared the consolidated financial statements in accordance with accounting principles generally accepted in the United States ("U.S. GAAP"). The accompanying consolidated financial statements include the accounts of the Company and its majority owned and controlled subsidiaries. All intercompany transactions and balances between the Company and its subsidiaries have been eliminated, and net income not attributable to the Company has been allocated to noncontrolling interests when material. The accompanying consolidated financial statements include all of the relevant revenues and expenses attributable to TicketMonster's operations.

Foreign Currency

The Company's functional currency is its local currency and its reporting currency is the United States dollar. Assets and liabilities of the subsidiaries are translated into United States dollars based on exchange rates at the end of the reporting period. Income and expense items are translated at the average exchange rates prevailing during the reporting period. Translation adjustments for subsidiaries that have not been sold, substantially liquidated or otherwise disposed of, are accumulated in other comprehensive income (loss), a component of stockholders' equity. Foreign currency translation adjustments are the sole component of accumulated other comprehensive loss at September 16, 2011. Transaction losses are included in the determination of net loss, and were approximately $0.1 million in the 2011 Period and none in the 2010 Period.

6

Ticket Monster Inc.

Notes to Consolidated Financial Statements

For the Period from January 1, 2011 through September 16, 2011 and from Date of Inception (February 1, 2010) through December 31, 2010

_____________________________________________________________________________________

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses during the reporting period. In the accompanying consolidated financial statements, estimates are used for, but not limited to, stock-based compensation, allowance for doubtful accounts, income taxes, acquired goodwill and intangible assets and their useful lives, recoverability of goodwill and other long-lived assets, refunds, contra revenue, loyalty rewards, deferred consideration, contingent liabilities and the depreciable lives of fixed assets. Actual results could differ materially from those estimates.

Fair Value

The consolidated financial statements include various financial instruments (primarily cash equivalents, contingent consideration, and deferred consideration) that are recorded at fair value. Fair value is the price that would be received from the sale of an asset or paid to transfer a liability assuming an orderly transaction in the most advantageous market at the measurement date. The Company's financial instruments that are not carried at fair value include restricted cash, prepaid expenses and other current assets, deposits, accounts receivable, accounts payable, merchants payable, accrued expenses, and other current liabilities. The carrying value of these assets and liabilities approximate their fair values due to their short-term nature. U.S. GAAP establishes a hierarchical disclosure framework which prioritizes and ranks the level of observability of inputs used in measuring fair value. These tiers include:

Level 1 defined as observable inputs such as quoted prices in active markets for identical assets;

Level 2 defined as observable inputs other than Level 1 prices such as quoted prices for similar assets; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities; and

Level 3 defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions.

See Note 7 for additional information regarding fair value.

Concentrations of Credit Risk

Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of cash and cash equivalents and accounts receivable. While the Company maintains its cash and cash equivalents with financial institutions with high credit ratings, it often maintains these deposits in governmentally insured financial institutions in excess of governmentally insured limits. Accounts receivable include funds owed to the Company by a limited number of payment processors.

Cash, Cash Equivalents and Restricted Cash

The Company considers all highly liquid investments with original maturities of three months or less to be cash equivalents. The cash and cash equivalents balances at September 16, 2011 and December 31, 2010 consisted of cash deposited in institutional money market mutual funds and regular interest bearing and noninterest bearing depository accounts with commercial banks.

Accounts Receivable

Accounts receivable primarily represents the net cash due from the Company's credit card and other payment processors for cleared transactions as well as cash due from merchants. When necessary, the carrying amount of the Company's receivables is reduced by an allowance for doubtful accounts that reflects management's best estimate of amounts that will

7

Ticket Monster Inc.

Notes to Consolidated Financial Statements

For the Period from January 1, 2011 through September 16, 2011 and from Date of Inception (February 1, 2010) through December 31, 2010

_____________________________________________________________________________________

not be collected. The allowance is based on historical loss experience and any specific risks identified in collection matters. The Company had no allowance for doubtful accounts at September 16, 2011 and December 31, 2010.

Property and Equipment

Property and equipment is carried at cost less accumulated depreciation. Depreciation is calculated using the straight-line method over the following estimated useful lives:

Office furniture and equipment	3 years
Software	3 years
Leasehold improvements	shorter of useful life or remaining lease term

The Company periodically reviews the depreciation method, useful lives and estimated salvage value of its property and equipment and revises those estimates as necessary. Repairs and maintenance costs are expensed as incurred.

Internally Developed Software

Costs related to the design or maintenance of internally developed software are expensed as incurred. Costs incurred to develop software applications for internal use are capitalized and amortized over the estimated useful lives of the software once placed in service. The Company capitalized $0.3 million in the 2011 Period and none in the 2010 Period.

Intangible Assets

Intangible assets are definite lived intangible assets generated from business combinations and carried at cost less accumulated amortization. Amortization is calculated over the estimated useful lives. The Company applies an accelerated method of amortization to reflect an estimated pattern of economic benefit received from the subscriber relationships intangible asset. The remaining intangible assets are amortized using the straight-line method over their estimated useful lives as patterns of economic benefit cannot be reliably determined.

Impairment of Other Long-lived Assets

The Company assesses its long-lived assets for impairment when indicators of potential impairment are present. If impairment indicators are present, recoverability of assets is measured by comparing the carrying values of the assets to the future undiscounted cash flows expected to be generated by the assets. Any impairment loss would be measured as the excess of the assets' carrying values over their fair values. Fair value is based on market prices, when available, or the use of various other valuation techniques.

Impairment of Goodwill

Goodwill is the excess of the acquisition cost of businesses over the fair value of the identifiable net assets acquired. The Company evaluates goodwill for impairment annually or more frequently when an event occurs or circumstances change that indicate that the carrying value may not be recoverable. The Company uses December 31 as the annual evaluation date. When the Company performs its impairment test, it first assesses qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If based on this assessment the Company determines it is more likely than not that the fair value of the reporting unit is less than its carrying amount, then performing the two-step impairment test is necessary. The first step of the goodwill impairment test examines whether the carrying value of a reporting unit exceeds its fair value. If the carrying value of the reporting unit exceeds its fair value, the second step of the test requires the Company to then compare the implied fair value of that reporting unit's goodwill with the carrying value of its goodwill to determine the amount of impairment charge, if any. Fair value is based on market prices, when available, or the use of various valuation techniques.

8

Ticket Monster Inc.

Notes to Consolidated Financial Statements

For the Period from January 1, 2011 through September 16, 2011 and from Date of Inception (February 1, 2010) through December 31, 2010

_____________________________________________________________________________________

Accrued severance benefits

Employees and directors with one year or more of service are entitled to receive a lump-sum payment upon termination of their employment with the Company based on the length of service and rate of pay at the time of termination. Accrued severance benefits are estimated based on legal requirements in Korea and estimated employment term. The annual severance benefits expense charged to operations is calculated based upon the net change in the accrued severance benefits payable at the balance sheet date.

Redeemable convertible preferred stock

The carrying value of the Company's redeemable convertible preferred stock is increased by the accretion of related issuance costs and dividends so that the carrying amount will equal the redemption amount at the dates they become redeemable. The preferred stock is redeemable at the option of the majority of the holders.

Comprehensive Income (Loss) and Accumulated Other Comprehensive Income (Loss)

Comprehensive income (loss) includes the total of the Company's net income (loss) and all other changes in equity other than transactions with owners, including changes in equity for cumulative translation adjustments resulting from the consolidation of foreign subsidiaries as the financial statements of the subsidiaries located outside of the Korea are accounted for using the local currency as the functional currency. Effective January 1, 2012, the Company adopted ASU 2011-05, Comprehensive Income (Topic 220): Presentation of Comprehensive Income (ASU 2011-05). As a result, the Company now presents a separate statement of comprehensive income (loss). The adoption of ASU 2011-05 did not affect the Company's consolidated results of operations, financial position, or liquidity.

Revenue Recognition

The Company recognizes revenue principally from (i) Deals, (ii) Products and (iii) other service offerings.  Revenue is recognized when the following criteria are met: persuasive evidence of an arrangement exists; delivery has occurred; the selling price is fixed or determinable; and collectability is reasonably assured. Any cash payments received from revenue transactions are recorded as deferred revenue until all of the criteria have been met. The Company had no deferred revenue in 2011 and 2010.

Deals

For Deals, the customer is the merchant. The revenue recognition criteria are met when the Company has fulfilled its obligations to the merchant typically by electronically delivering the voucher to the subscriber and providing the purchaser list to the merchant. Under certain Deals arrangements, the Company is obligated to (i) provide subscriber delivery information to the merchant or (ii) deliver the products to the subscriber on behalf of the merchant; in these situations the revenue recognition criteria are satisfied when the required obligations are met.  The Company's Deal merchants assume the contractual risks, which include providing the goods or service and the risk of unsold inventory. As such, all Deals transactions are recorded at the net commission amount, which is the amount charged to the subscriber less the amount to be paid to the merchant and any applicable taxes and net of estimated refunds.

Under certain Deals arrangements, the Company pays the merchant on a redemption model, whereby the merchant is paid based on vouchers redeemed as opposed to vouchers sold. If a subscriber does not redeem a voucher under these agreements, the Company retains the entire initial purchase value of the voucher including the amount that would have been payable to the merchant if the deal had been redeemed, to the extent permitted by local laws and regulations. The Company records revenue from unredeemed vouchers, less any applicable taxes, and derecognizes the related liability only when the Company is legally released from its obligation, which the Company deems to be the later of (i) the expiration of the paid and promotional value of the voucher and (ii) final payment to the merchant to the extent permitted by local law.

9

Ticket Monster Inc.

Notes to Consolidated Financial Statements

For the Period from January 1, 2011 through September 16, 2011 and from Date of Inception (February 1, 2010) through December 31, 2010

_____________________________________________________________________________________

Products

For Products, the revenue recognition criteria are met when the goods are shipped and title passes to the subscriber, which is the customer in a Products arrangement. Product sales represent revenue from the gross selling price of products and related shipping fees, net of promotional discounts and returns allowances. The Company is the primary obligor in these transactions, is subject to inventory risk, and has latitude in establishing prices.

Contra-revenue

The Company makes payments through arrangements with merchants. Payments to merchants are generally recorded as contra-revenue unless the Company receives in return a specifically identifiable benefit and the fair value of such benefit is determinable and measurable. If a benefit can be identified with a determinable and measurable fair value, the payment is recorded as marketing expense up to the fair value of the benefit.

Subscriber Loyalty Programs

The Company's loyalty programs allow its subscribers to earn credits that can be redeemed for future purchases of Deals or Products. Subscriber credits are provided to existing subscribers for performing qualifying acts. A qualifying act is when a subscriber performs an action, such as providing the Company a new subscriber referral, and the subscriber is made aware of the credits prior to the performance of the action. Upon issuance of the subscriber credits following a qualifying act, the value of subscriber credits is allocated between marketing expense or contra-revenue, based upon an estimate of whether such credits will be used by a subscriber in a Deals or Products transaction. If credits are issued for a specific revenue transaction, the value of the subscriber credit is recorded consistent with the underlying revenue transaction. Unredeemed subscriber credits are recorded at the Company's ultimate cost of such credits in accrued liabilities. The cost of expired credits is reversed against the initial marketing expense or revenue amounts in the period of expiration.

The Company also issues promotional credits in subscriber acquisition and other marketing campaigns, where the recipient of the credits is not required to perform any qualifying acts. Upon redemption, the value of promotional credits is recorded as either marketing expense or contra-revenue, dependent upon how the underlying revenue transaction is recorded (Deals or Products, respectively).

Subscriber Refunds

At the time revenue is recorded, the Company records an accrual for estimated refunds primarily based on the Company's historical experience with refunds.  Refunds are recorded as a reduction of revenue.  The liability for refunds is adjusted as appropriate as actual refund activity occurs. The Company routinely evaluates its assumptions used to estimate its subscriber refund accrual based on developments in refund and expiration patterns, subscriber contract changes, and other factors.

Costs of Revenue

Costs of revenue consist primarily of editorial and production costs, which include payroll and benefit costs, including related stock-based compensation expense, email fees for delivering vouchers to subscribers, fees paid to credit card and other payment processors, shipping costs, commissions paid to delivery agents and distributor fees. The Company records these costs when incurred. In addition, when it becomes probable that a revenue contract will result in an overall loss, the expected loss is recognized as costs of revenue when such losses are incurred.

Marketing Expenses

Marketing expense consists primarily of subscriber acquisition costs. These include online marketing costs, such as sponsored search, advertising on social networking sites, email marketing campaigns, and subscriber loyalty programs, and to a lesser extent, offline marketing costs such as television, radio and print advertising. Marketing payroll and benefit costs, including related stock- based compensation expense, are also classified as marketing expense. The Company records these

10

Ticket Monster Inc.

Notes to Consolidated Financial Statements

For the Period from January 1, 2011 through September 16, 2011 and from Date of Inception (February 1, 2010) through December 31, 2010

_____________________________________________________________________________________

costs when incurred. For the 2011 Period and the 2010 Period, advertising costs were $17.3 million and $2.4 million, respectively.

Stock-Based Compensation

The Company uses its common stock to compensate its employees for future services with various forms of stock-based awards, including but not limited to stock options and restricted stock. The Company accounts for stock-based compensation at fair value on the date of grant or modification, net of estimated forfeitures. The Company determines the fair value of stock options using the Black-Scholes option pricing model. The fair value of other stock-based awards is based on the valuation of the Company's common stock on the date of grant or modification (see Note 6). The fair value of an award that is ultimately expected to vest is recognized as expense on a straight-line basis over the requisite service period.

Stock-based compensation is classified in the consolidated statements of operations in a manner consistent with the statements of operations' classification of the employee's salary and benefits, as follows:

(in thousands)	For the Period from January 1, 2011 through September 16, 2011		From the Date of Inception through December 31, 2010
Marketing expenses	$	814	$	5
Selling, general and administrative	3,349		9
Stock-based compensation	$	4,163	$	14

Income Taxes

The Company accounts for income taxes using the asset and liability approach. This approach requires the recognition of tax benefits or expenses on the temporary differences between the financial reporting and tax bases of the Company’s assets and liabilities. A valuation allowance is established when necessary to reduce deferred tax assets to the amounts expected to be realized. The Company also recognizes a tax benefit from uncertain tax positions only if it is "more likely than not" that the position is sustainable based on its technical merits. The Company’s policy is to recognize interest and penalties on uncertain tax positions as a component of income tax expense.

3.    Business Combinations

The Company's acquisition activities in 2011 and 2010 are as follows:

Acquisition of Astrics

On June 10, 2011, the Company entered into a Share Purchase Agreement (the "Astrics Agreement") to acquire 100% of the outstanding equity of Astrics for purchase consideration of $2.5 million of which $0.9 million was paid in cash. The remainder is payable in installments over a three year period. The remaining installment payments have been reflected at their net present value. As a result of the acquisition, the Company believes it has obtained several highly skilled developers as employees to support the Company's growth strategy.

The acquisition is accounted for using the acquisition method of accounting and the operations of Astrics are included in the consolidated financial statements from the date of acquisition. The purchase price was allocated to net assets based on their estimated fair values on the acquisition date, with the remaining unallocated purchase price recorded as goodwill. The goodwill of the acquired company is primarily related to expected sales growth from future product offerings and customers, together with certain intangible assets that do not qualify for separate recognition, including assembled workforce. None of the goodwill is deductible for tax purposes.

11

Ticket Monster Inc.

Notes to Consolidated Financial Statements

For the Period from January 1, 2011 through September 16, 2011 and from Date of Inception (February 1, 2010) through December 31, 2010

_____________________________________________________________________________________

The following summarizes the allocation of the Astrics purchase price:

		Fair Value			Estimated
		(in thousands)			Useful Lives
Tangible assets		$	1,038
Liabilities		(216		)
Deferred tax liabilities		(390		)
Goodwill		516
Intangible assets:
	Customer relationships	608			10 years
	Developed technology	148			5 years
	Non-compete agreement	775			2.5 years
Total purchase consideration		$	2,479

The fair value assigned to identifiable intangible assets acquired was determined using an income approach for customer relationships, developed technology and non-compete agreement. Purchased identifiable intangible assets are amortized on a straight-line basis over their respective useful lives.

Acquisition of Daily Pick

On December 27, 2010, the Company entered into a Share Purchase Agreement (the "Daily Pick Agreement") to acquire 100% of the outstanding equity of Daily Pick for purchase consideration of $4.3 million. $0.9 million was paid in cash, and the remainder is payable in installments over a two year period. The remaining installment payments have been reflected at their net present value. The Company acquired Daily Pick to significantly expand its presence in the daily deal market, specifically for food and beverage, and to obtain additional key members to supplement the existing senior management team.

The acquisition is accounted for using the acquisition method of accounting and the operation of Daily Pick is included in the consolidated financial statements from the date of acquisition. The purchase price was allocated to net assets based on their estimated fair values on the acquisition date, with the remaining unallocated purchase price recorded as goodwill. The goodwill of the acquired company is primarily related to expected sales growth from future product offerings and customers, together with certain intangible assets that do not qualify for separate recognition, including assembled workforce. None of the goodwill is deductible for tax purposes.

12

Ticket Monster Inc.

Notes to Consolidated Financial Statements

For the Period from January 1, 2011 through September 16, 2011 and from Date of Inception (February 1, 2010) through December 31, 2010

_____________________________________________________________________________________

The following summarizes the allocation of Daily Pick purchase price:

		Fair Value			Estimated
		(in thousands)			Useful Lives
Tangible assets		$	521
Liabilities		(556		)
Deferred tax liabilities		(658		)
Goodwill		2,193
Intangible assets:
	Customer relationships	268			5 years
	Trademark and tradenames	2,207			0.5 years
	Non-compete agreement	259			1 year
	Website	16			5 years
Total purchase consideration		$	4,250

The fair value assigned to identifiable intangible assets acquired was determined using an income approach for customer relationships, trademark and tradenames and non-compete agreement, and a cost approach for website. Purchased identifiable intangible assets that have finite lives are amortized on a straight-line basis over their respective useful lives.

4.    Property and Equipment

Depreciation and amortization expense related to property and equipment was $0.2 million in the 2011 Period and was $0.01 million in the 2010 Period.

5.    Intangible Assets and Goodwill

Amortization expense for definite lived intangible assets was approximately $3.6 million and $0.01 million for the 2011 Period and the 2010 Period, respectively. The weighted average remaining amortization period of intangible assets is 2.6 years as of September 16, 2011.  Estimated future amortization expense with respect to definite lived intangible assets existing at September 16, 2011, by year and in the aggregate, is as follows:

(in thousands)
2011 (remaining three months)	$	267
2012	493
2013	467
2014	79
2015	55
thereafter	1
	$	1,362

There were no goodwill impairment losses or measurement period adjustments during 2011 or 2010.

13

Ticket Monster Inc.

Notes to Consolidated Financial Statements

For the Period from January 1, 2011 through September 16, 2011 and from Date of Inception (February 1, 2010) through December 31, 2010

_____________________________________________________________________________________

6.    Stock-Based Compensation

For the 2010 period, in connection with the acquisition of Daily Pick, employees received 4,167 restricted common shares, all of which vest over a two-year period.

The table below summarizes activity regarding unvested restricted shares during the 2011 and 2010 Periods:

	Restricted Shares		Weighted- Average Grant Date Fair Value
Unvested at February 1, 2010 (inception date)	—		—
Granted	4,167		$	567
Vested	—		$	—
Forfeited	—		$	—
Unvested at December 31, 2010	4,167		$	567
Granted	481		$	3,823
Vested	(4,648	)	$	904
Forfeited	—		$	—
Unvested at September 16, 2011	—

Until the restrictions lapse, ownership of the affected shares of restricted share granted to the Company's employees is conditional upon continuous employment with the Company. During the restricted period, holders of restricted shares have full voting rights, even though the restricted shares remain subject to transfer restrictions and generally are subject to forfeiture upon termination of employment or service. If the employee terminates service before the restrictions lapse, the restricted shares may be repurchased by either the Company or other shareholders from the individual at par value.

The aggregate fair value of restricted shares on the date of grant is $4.2 million. During the 2011 Period and the 2010 Period the Company recognized $4.2 million and $0.01 million of compensation expense, respectively. There is no remaining unrecognized compensation expense at September 16, 2011 and $2.4 million at December 31, 2010.

The Company, with the support of third party advisor, determined the fair value per share of the common stock through the application of a discounted cash flow methodology and binomial model. Determining the fair value of the Company's common stock required making complex and subjective judgments. The assumptions used in the valuation models were based on future expectations combined with management estimates. The discounted cash flow method valued the business by discounting future available cash flows to present value. The cash flows were determined using forecasts of revenue, net income and debt-free future cash flow. The discount rate was derived using a Capital Asset Pricing Model. The Company also applied a lack of marketability discount to its enterprise value, which took into account that investments in private companies are less liquid than similar investments in public companies. A binomial model was used to allocate the enterprise value between the common stock and preferred shares. There is inherent uncertainty in all of the estimates applied in deriving the fair value per share of common stock.

7.    Fair Value

Fair value is the price that would be received from the sale of an asset or paid to transfer a liability assuming an orderly transaction in the most advantageous market at the measurement date. U.S. GAAP establishes a hierarchical disclosure framework which prioritizes and ranks the level of observability of inputs used in measuring fair value.

14

Ticket Monster Inc.

Notes to Consolidated Financial Statements

For the Period from January 1, 2011 through September 16, 2011 and from Date of Inception (February 1, 2010) through December 31, 2010

_____________________________________________________________________________________

Assets and Liabilities Measured at Fair Value on a Recurring Basis

Short-term Financial Instruments

The inputs used in measuring the fair value of cash and cash equivalents are considered to be Level 1 in accordance with the three-tier fair value hierarchy. The fair market values are based on quoted prices in active markets at period-end supplied by the various banks and brokers that held the majority of the Company's funds.

Other Instruments

The Company has no other financial instruments or nonfinancial assets or liabilities that are measured at fair value on a recurring basis.

Assets Measured at Fair Value on a Nonrecurring Basis

The Company measures its long-lived assets, including property and equipment, goodwill and other intangible assets, at fair value on a nonrecurring basis. These assets are recognized at fair value when they are deemed to be impaired.

8.    Shareholders' Equity

Each common share carries one voting right. The holders of common shares are also entitled to receive dividends whenever funds are legally available and when declared by the Board of Directors, subject to prior rights of holders of all classes of share outstanding having priority rights as to dividends, such as the preferred shares discussed below. No dividends have been declared or paid on any of the Company's outstanding common shares as of September 16, 2011.

Redeemable convertible preferred stock

In January 2011, the Company authorized and issued 5,380 shares of Series B Preferred for $8.0 million in gross proceeds (net of issuance costs of $0.01 million).

In September 2010, the Company authorized issuance of 8,530 shares of Series A Preferred for $2.9 million in gross proceeds (net of issuance costs of $0.02 million). The rights, preferences, privileges, restrictions and other matters relating to the Series Preferred shares are summarized below.

Series B Preferred Stock

The principal terms and conditions of the Series B Preferred shares are as follows:

Voting rights - Each holder of outstanding Preferred Shares shall be entitled to the number of votes equal to the number of Preferred Shares, at each annual or extraordinary general meeting of shareholders of the Company with respect to any and all matters presented to the shareholders of the Company for their action or consideration.

Dividends - The holders of Series B Preferred shall be entitled to receive cumulative dividends on each share of Series B Preferred during each fiscal year of the Company in an amount equal to an annual interest of 0.01% of the issue price per share of Series B Preferred, out of funds legally available therefore, payable in preference to any dividend or distribution on the Series A or the common stock. All dividends on the Series B Preferred shall be declared and paid on a pro rata basis in proportion to the number of then outstanding shares of Series B Preferred. No dividends shall be declared and paid with respect to the common stock or to the Series A Preferred in any such fiscal year unless the full preferential dividends on the Series B Preferred, as set forth above, shall have first been declared and paid.

15

Ticket Monster Inc.

Notes to Consolidated Financial Statements

For the Period from January 1, 2011 through September 16, 2011 and from Date of Inception (February 1, 2010) through December 31, 2010

_____________________________________________________________________________________

Liquidation preference - To the extent permitted under Korean law, in the event of any liquidation, dissolution, or winding up of the Company, either voluntary or involuntary, distributions to the shareholders of the Company shall be made with respect to each Preferred Share an amount in cash equal to the sum of 100% of issue price per share of Series B then held by them (as adjusted for any share dividends, combinations, splits and the like), plus an amount equal to 10% of the issue price compounded annually from the Issue Date to the date of actual distribution, less any accrued and paid dividends.

Conversion - Each share of Series B shall be convertible, at the option of the holder thereof, at any date falling on or after the issue date and from time to time until the date when the Series B is redeemed. Each share of Series B shall be convertible into such number of shares of common share as is determined by dividing the per share Series B Liquidation Preference by the Conversion Price in effect at the time of conversion. The initial price at which shares of common share shall be deliverable upon conversion of Series B shall be the issue price per share of Series B. Such initial Conversion Price shall be subject to adjustment.

Redemption - Subject to any legal restrictions on the Company's redemption of shares and to the extent permitted under Korean law, any Series B holders may require the Company to redeem, and the Company shall redeem at any time after the 3rd anniversary until the 10th anniversary of the issue date. The redemption price shall equal the issue price per share (as adjusted for any share dividends, combinations, splits and the like) plus all accrued but unpaid dividends thereon and an amount equal to an annual compound interest of 10% of the issue price of such shares per annum from the issue date to the date of actual payment of the redemption price (the redemption price shall be proportionally adjusted for share splits, share dividends, etc).

Series A Preferred Stock

The principal terms and conditions of the Series A Preferred shares are as follows:

Voting rights - Each holder of outstanding Preferred Shares shall be entitled to the number of votes equal to the number of Preferred Shares, at each annual or extraordinary general meeting of shareholders of the Company with respect to any and all matters presented to the shareholders of the Company for their action or consideration.

Dividends - The holders of Series A Preferred shall be entitled to receive cumulative dividends on each share of Series A Preferred during each fiscal year of the Company in an amount equal to an annual interest of 0.01% of the issue price per share of Series A Preferred, out of funds legally available therefore, payable in preference to any dividend or distribution on the common stock. All dividends on the Series A Preferred shall be declared and paid on a pro rata basis in proportion to the number of then outstanding shares of Series A Preferred. No dividends shall be declared and paid with respect to the common stock in any such fiscal year unless the full preferential dividends on the Series A Preferred, as set forth above, shall have first been declared and paid.

Liquidation preference - To the extent permitted under Korean law, in the event of any liquidation, dissolution, or winding up of the Company, either voluntary or involuntary, distributions to the shareholders of the Company shall be made with respect to each Preferred Share an amount in cash equal to the sum of 100% of issue price per share of Series A then held by them (as adjusted for any share dividends, combinations, splits and the like), plus an amount equal to 10% of the issue price compounded annually from the Issue Date to the date of actual distribution, less any accrued and paid dividends.

Conversion - Each share of Series A shall be convertible, at the option of the holder thereof, at any date falling on or after the issue date and from time to time until the date when the Series A is redeemed. Each share of Series A shall be convertible into such number of shares of common share as is determined by dividing per share Series A Liquidation Preference by the Conversion Price in effect at the time of conversion. The initial price at which shares of common share shall be deliverable upon conversion of Series A shall be the issue price per share of Series A. Such initial Conversion Price shall be subject to adjustment.

Redemption - Subject to any legal restrictions on the Company's redemption of shares and to the extent permitted under Korean law, any Series A holders may require the Company to redeem, and the Company shall redeem at any time after the 3rd anniversary until the 10th anniversary of the issue date. The redemption price shall equal the issue price per share

16

Ticket Monster Inc.

Notes to Consolidated Financial Statements

For the Period from January 1, 2011 through September 16, 2011 and from Date of Inception (February 1, 2010) through December 31, 2010

_____________________________________________________________________________________

(as adjusted for any share dividends, combinations, splits and the like) plus all accrued but unpaid dividends thereon and an amount equal to an annual compound interest of 10% of the issue price of such shares per annum from the issue date to the date of actual payment of the redemption price (the redemption price shall be proportionally adjusted for share splits, share dividends, etc).

For future periods, the combined aggregated amount of redemption requirements is as follows (in thousands):

2011 (remaining three months)	$	—
2012	$	—
2013	$	3,867
2014	$	10,670
2015	$	11,737

9.    Income Taxes

Domestic (Korean) and foreign components of loss from continuing operations before income taxes are presented below:

(in thousands)	Period from January 1, 2011 through September 16, 2011			Period from Date of Inception through December 31, 2010
Domestic loss before income taxes	$	(33,219	)	$	(2,343	)
Foreign loss before income taxes	—			—
Total loss before income taxes	$	(33,219	)	$	(2,343	)

17

Ticket Monster Inc.

Notes to Consolidated Financial Statements

For the Period from January 1, 2011 through September 16, 2011 and from Date of Inception (February 1, 2010) through December 31, 2010

_____________________________________________________________________________________

The benefit from income taxes consists of the following:

(in thousands)		Period from January 1, 2011 through September 16, 2011			Period from Date of Inception through December 31, 2010
Current income tax provision (benefit):
	Domestic	$	—		$	—
	Foreign	—			—
	Total	—			—
Deferred income tax benefit:
	Domestic	(7,138		)	(529		)
	Foreign	—			—
	Total	(7,138		)	(529		)
Change in valuation allowance		6,065			529
Total benefit for income taxes		$	(1,073	)	$	—

The difference between income taxes computed by applying the Korean statutory income tax rate to earnings before income taxes and the provision for income taxes is attributable to the following:

(in thousands)	Period from January 1, 2011 through September 16, 2011			Period from Date of Inception through December 31, 2010
Expected tax provision at Korean statutory rate of 24.2%	$	(8,039	)	$	(567	)
Stock based compensation	832
Change in valuation allowance	6,065			529
Other	69			38
Total income tax benefit	$	(1,073	)	$	—

As of September 16, 2011 the Company had domestic net operating loss carry forwards of $23.4 million, which begin to expire in 2020. The Company is required to establish a valuation allowance for deferred tax assets if, based on the weight of available evidence, it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Based upon the level of historical taxable income and projections for future taxable income in the periods which the deferred tax assets are deductible, the Company has determined that a full valuation allowance against its net deferred tax assets is required as of September 16, 2011 and December 31, 2010.

The Company is subject to income taxes in the jurisdictions in which it operates. Significant judgment is required in evaluating the Company's tax positions and determining its provision for income taxes. The Company establishes liabilities for tax-related uncertainties based on estimates of whether, and the extent to which, additional taxes will be due. These

18

Ticket Monster Inc.

Notes to Consolidated Financial Statements

For the Period from January 1, 2011 through September 16, 2011 and from Date of Inception (February 1, 2010) through December 31, 2010

_____________________________________________________________________________________

liabilities are established when the Company believes that certain positions might be challenged despite its belief that its tax return positions are fully supportable. The Company adjusts these liabilities in light of changing facts and circumstances, such as the outcome of a tax audit. The provision for income taxes includes the impact of changes to the liability that is considered appropriate. The Company has identified no material uncertain tax positions as of September 16, 2011 and December 31, 2010.

The Company is subject to income tax audits in all jurisdictions for which it files tax returns. Tax audits by their very nature are often complex and can require several years to complete. Neither the Company nor any of its subsidiaries is currently under audit in any jurisdiction. All of the Company's income tax returns remain subject to examination by tax authorities.

10.    Commitments and Contingencies

Operating Leases

The Company has entered into various noncancelable operating lease agreements, primarily covering certain of its offices throughout the world, with original lease periods expiring in 2012. Rent expense under these operating leases was $0.8 million and $0.07 million forthe 2011 Period and for the 2010 Period, respectively. Certain of these arrangements have renewal or expansion options and adjustments for market provisions, such as free or escalating base monthly rental payments. The Company recognizes rent expense under such arrangements on a straight-line basis over the initial term of the lease. The difference between the straight-line expense and the cash paid for rent has been recorded as deferred rent.

At September 16, 2011, future payments under operating leases (including rent escalation clauses but excluding proportionate share of operating expenses) were $0.6 million during the remainder of 2011 and $0.8 million in 2012.

Contingencies

From time to time the Company is party to certain litigation or other legal proceedings arising in the ordinary course of business.  Because of the uncertainties inherent in litigation, the Company cannot predict the outcome of such litigation or other legal proceedings; however, the Company believes that none of these matters are probable or estimable at this time. Accordingly, the Company has not recorded an accrual for any possible losses in its financial statements.

11.    Subsequent Events

The Company has performed an evaluation of subsequent events through the date the accompanying financial statements were available and issued.

In November 2013, LivingSocial, Inc. entered into a definitive agreement to sell its Korean subsidiaries (including the Company) to an affiliate of Groupon, Inc. for $260 million in cash and stock. The agreement is for at least $100 million in cash and up to $160 million in the Class A common stock of Groupon, Inc., with the final cash and stock allocation to be determined prior to close.

The transaction is expected to close in January 2014, subject to customary closing conditions. As part of the transaction, all shares of LivingSocial common stock that were to be earned by and distributed to TicketMonster employees pursuant to the Company's 2011 acquisition of TicketMonster will be distributed prior to closing, and all outstanding options to acquire the LivingSocial's common stock held by TicketMonster employees will terminate in accordance with their terms (generally upon closing for unvested options and three months after closing for vested options). Additionally, in conjunction with the transaction, LivingSocial will purchase from the Company 100% of its Malaysian subsidiary.

19

EX-99.6

Exhibit 99.6

UNAUDITED PRO FORMA CONDENSED COMBINED CONSOLIDATED FINANCIAL STATEMENTS

On January 2, 2014, Groupon, Inc., ("Groupon" or the "Company") through its direct subsidiary Groupon Trailblazer, Inc., completed the acquisition of all the outstanding equity interests of LivingSocial Korea, Inc., a Korean corporation including its subsidiary Ticket Monster Inc., a Korean corporation, from LivingSocial Inc., a Delaware corporation ("LivingSocial"), and LivingSocial B.V., a Netherlands limited liability company and direct subsidiary of LivingSocial for $100.0 million in cash and Groupon, Inc. Class A common stock with a fair value of $162.9 million.

The following unaudited pro forma condensed combined consolidated financial statements have been derived by the application of pro forma adjustments to the Company's historical consolidated financial statements. The unaudited pro forma condensed combined balance sheet as of September 30, 2013 for Groupon, Inc. and LivingSocial Korea, Inc. is presented as if the acquisition had occurred on September 30, 2013. The unaudited pro forma condensed combined statement of operations of Groupon, Inc. and LivingSocial Korea, Inc. for the nine months ended September 30, 2013 and for the year ended December 31, 2012 are presented as if the acquisition had occurred on January 1, 2012. The unaudited pro forma condensed combined consolidated financial statements are being provided for illustrative purposes only and do not purport to represent what our results of operations or financial position would have been if the transaction had occurred on the dates indicated and are not intended to project our results of operations or financial position for any future period. Any of the factors underlying these estimates and assumptions may change or prove to be materially different and the estimates and assumptions may not be representative of facts existing upon finalization of the acquisition.

The acquisition has been accounted for using the acquisition method of accounting. Under the acquisition method of accounting, the total acquisition price presented in the accompanying unaudited pro forma condensed combined consolidated financial statements has been preliminarily allocated to the assets acquired and liabilities assumed based on their estimated fair values as of the acquisition date. Acquired goodwill represents the premium the Company paid over the fair value of the net tangible and intangible assets acquired. The unaudited pro forma condensed combined consolidated financial statements contained herein do not reflect the costs of any integration activities or benefits that may result from realization of future cost savings from operating efficiencies, or any revenue, tax, or other synergies that may result from the acquisition.

The unaudited pro forma adjustments are based on estimates, available information and certain assumptions that the Company believes are reasonable. The unaudited pro forma adjustments and primary assumptions are described in the accompanying notes. The unaudited pro forma condensed combined consolidated financial statements and the related notes should be read in conjunction with the consolidated financial statements and the accompanying notes of LivingSocial Korea, Inc. and Ticket Monster Inc. included in Exhibit 99.3, 99.4 and 99.5 of this Current Report on Form 8-K and the historical consolidated financial statements and accompanying notes of Groupon, Inc. included in the Company's Annual Report on Form 10-K for the year ended December 31, 2012 and the Company’s Quarterly Report on Form 10-Q for the period ended September 30, 2013.

1

GROUPON, INC.

UNAUDITED PRO FORMA CONDENSED COMBINED CONSOLIDATED

BALANCE SHEET

As of September 30, 2013

(in thousands)

	Groupon, Inc. Historical (unaudited)			LivingSocial Korea, Inc. Historical (unaudited)			Adjustments for Operations Not Acquired (1)			Pro Forma Adjustments (2)						Notes	Pro Forma Combined
Assets
Current assets:
Cash and cash equivalents	$	1,139,857		$	15,133		$	(49	)	$	—		$	(100,000	)	a	$	1,054,941
Accounts receivable, net	86,233			12,322			(35		)	—			—				98,520
Deferred income taxes	30,692			—			—			—			—				30,692
Prepaid expenses and other current assets	136,543			5,021			(202		)	—			—				141,362
Total current assets	1,393,325			32,476			(286		)	—			(100,000		)		1,325,515
Property, equipment and software, net	126,881			5,976			(157		)	—			—				132,700
Goodwill	218,224			50,685			(190		)	(50,495		)	231,644			b	449,868
Intangible assets, net	33,182			40,960			—			(40,960		)	92,800			c	125,982
Investments	104,130			—			—			—			—				104,130
Deferred income taxes, non-current	29,476			—			—			—			—				29,476
Other non-current assets	45,322			1,435			—			—			—				46,757
Total Assets	$	1,950,540		$	131,532		$	(633	)	$	(91,455	)	$	224,444			$	2,214,428
Liabilities and Equity
Current liabilities:
Accounts payable	$	33,684		$	8,105		$	(6	)	$	—		$	—			$	41,783
Accrued merchant and supplier payables	591,476			66,153			(1,421		)	—			—				656,208
Accrued expenses	211,718			15,120			(186		)	—			3,394			d	230,046
Due to related parties	—			16,920			(2,072		)	(14,848		)	—			e	—
Deferred income taxes, current	52,216			—			—			—			—				52,216
Other current liabilities	126,764			807			—			—			—				127,571
Total current liabilities	1,015,858			107,105			(3,685		)	(14,848		)	3,394				1,107,824
Deferred income taxes, non-current	20,356			—			—			—			7,385			f	27,741
Other non-current liabilities	105,529			5,069			—			—			—				110,598
Total Liabilities	1,141,743			112,174			(3,685		)	(14,848		)	10,779				1,246,163
Stockholders' Equity
Class A common stock	66			—			—			—			2			g	68
Class B common stock	—			—			—			—			—				—
Common stock	—			—			—			—			—				—
Additional paid-in capital	1,563,815			288,475			(295		)	(288,180		)	162,860			g, h	1,726,675
Treasury stock, at cost	(9,014		)	—			—			—			—				(9,014		)
Investment in shares of Parent, at cost	—			(99,403		)	—			99,403			—			h	—
Accumulated deficit	(767,623		)	(169,159		)	3,409			165,750			(3,394		)	d, h	(771,017		)
Accumulated other comprehensive income (loss)	23,579			(555		)	(62		)	617			—			h	23,579
Total Groupon, Inc. Stockholders' Equity	810,823			19,358			3,052			(22,410		)	159,468				970,291
Noncontrolling interests	(2,026		)	—			—			—			—				(2,026		)
Total Equity	808,797			19,358			3,052			(22,410		)	159,468				968,265
Total Liabilities and Equity	$	1,950,540		$	131,532		$	(633	)	$	(37,258	)	$	170,247			$	2,214,428

The accompanying notes are an integral part of, and should be read together with, this unaudited pro forma condensed combined consolidated balance sheet.

(1) See note 2 in the accompanying notes for discussion of adjustments related to operations not acquired.

(2) See note 3 in the accompanying notes for discussion of pro forma adjustments.

2

GROUPON, INC.

UNAUDITED PRO FORMA CONDENSED COMBINED CONSOLIDATED

STATEMENT OF OPERATIONS

For the nine months ended September 30, 2013

(in thousands, except share and per share amounts)

	Groupon, Inc. Historical (unaudited)			LivingSocial Korea, Inc. Historical (unaudited)			Adjustments for Operations Not Acquired (1)			Pro Forma Adjustments (2)						Notes	Pro Forma Combined
Revenue:
Third party and other	$	1,252,966		$	79,427		$	(2,590	)	$	(3,447	)	$	—		i	$	1,326,356
Direct	552,242			1,638			—			—			—				553,880
Total revenue	1,805,208			81,065			(2,590		)	(3,447		)	—				1,880,236
Cost of revenue:
Third party and other	179,524			20,187			(563		)	197			—			j	199,345
Direct	502,359			1,145			—			38			—			j	503,542
Total cost of revenue	681,883			21,332			(563		)	235			—				702,887
Gross profit	1,123,325			59,733			(2,027		)	(3,682		)	—				1,177,349
Operating expenses:
Marketing	158,319			13,567			(711		)	(3,447		)	—			i	167,728
Selling, general and administrative	904,880			72,230			(2,175		)	1,891			14,625			j,k	991,451
Depreciation and amortization	—			13,470			—			(13,470		)	—			j,k	—
Acquisition-related benefit, net	(2,276		)	—			—			—			—				(2,276		)
Total operating expenses	1,060,923			99,267			(2,886		)	(15,026		)	14,625				1,156,903
Income (loss) from operations	62,402			(39,534		)	859			11,344			(14,625		)		20,446
Loss on equity method investments	(58		)	—			—			—			—				(58		)
Other income (expense), net	(9,772		)	(636		)	122			—			—				(10,286		)
Income (loss) before provision (benefit) for income taxes	52,572			(40,170		)	981			11,344			(14,625		)		10,102
Provision (benefit) for income taxes	62,657			—			—			2,745			(3,539		)	l	61,863
Net (loss) income	(10,085		)	(40,170		)	981			8,599			(11,086		)		(51,761		)
Net income attributable to noncontrolling interests	(4,061		)	—			—			—			—				(4,061		)
Net (loss) income attributable to Groupon, Inc.	$	(14,146	)	$	(40,170	)	$	981		$	8,599		$	(11,086	)		$	(55,822	)
Net loss per share
Basic	$(0.02)																$(0.08)
Diluted	$(0.02)																$(0.08)
Weighted average number of shares outstanding
Basic	662,531,567									13,825,283						m	676,356,850
Diluted	662,531,567									13,825,283						m	676,356,850

The accompanying notes are an integral part of, and should be read together with, this unaudited pro forma condensed combined consolidated statement of operations.

(1) See note 2 in the accompanying notes for discussion of adjustments related to operations not acquired.

(2) See note 3 in the accompanying notes for discussion of pro forma adjustments.

3

GROUPON, INC.

UNAUDITED PRO FORMA CONDENSED COMBINED CONSOLIDATED

STATEMENT OF OPERATIONS

For the year ended December 31, 2012

(in thousands, except share and per share amounts)

	Groupon, Inc. Historical			LivingSocial Korea, Inc. Historical			Adjustments for Operations Not Acquired (1)			Pro Forma Adjustments (2)						Notes	Pro Forma Combined
Revenue:
Third party and other	$	1,879,729		$	73,550		$	(2,370	)	$	(528	)	$	—		i	$	1,950,381
Direct	454,743			3,300			—			—			—				458,043
Total revenue	2,334,472			76,850			(2,370		)	(528		)	—				2,408,424
Cost of revenue:
Third party and other	297,739			25,032			(511		)	74			—			j	322,334
Direct	421,201			1,808			—			8			—			j	423,017
Total cost of revenue	718,940			26,840			(511		)	82			—				745,351
Gross profit	1,615,532			50,010			(1,859		)	(610		)	—				1,663,073
Operating expenses:
Marketing	336,854			19,803			(953		)	(528		)	—			i	355,176
Selling, general and administrative	1,179,080			101,002			(3,095		)	2,028			19,500			j,k	1,298,515
Depreciation and amortization	—			34,653			—			(34,653		)	—			j,k	—
Acquisition-related expense, net	897			—			—			—			—				897
Total operating expenses	1,516,831			155,458			(4,048		)	(33,153		)	19,500				1,654,588
Income (loss) from operations	98,701			(105,448		)	2,189			32,543			(19,500		)		8,485
Loss on equity method investments	(9,925		)	—			—			—			—				(9,925		)
Other income (expense), net	6,166			1,755			(299		)	—			—				7,622
Income (loss) before provision (benefit) for income taxes	94,942			(103,693		)	1,890			32,543			(19,500		)		6,182
Provision (benefit) for income taxes	145,973			(8,274		)	—			7,875			(4,719		)	l	140,855
Net (loss) income	(51,031		)	(95,419		)	1,890			24,668			(14,781		)		(134,673		)
Net income attributable to noncontrolling interests	(3,742		)	—			—			—			—				(3,742		)
Net (loss) income attributable to Groupon, Inc.	(54,773		)	(95,419		)	1,890			24,668			(14,781		)		(138,415		)
Adjustment of redeemable noncontrolling interests to redemption value	(12,604		)	—			—			—			—				(12,604		)
Net (loss) income attributable to common stockholders	$	(67,377	)	$	(95,419	)	$	1,890		$	24,668		$	(14,781	)		$	(151,019	)
Net loss per share
Basic	$(0.10)																$(0.23)
Diluted	$(0.10)																$(0.23)
Weighted average number of shares outstanding
Basic	650,214,119									13,825,283						m	664,039,402
Diluted	650,214,119									13,825,283						m	664,039,402

The accompanying notes are an integral part of, and should be read together with, this unaudited pro forma condensed combined consolidated statement of operations.

(1) See note 2 in the accompanying notes for discussion of adjustments related to operations not acquired.

(2) See note 3 in the accompanying notes for discussion of pro forma adjustments.

4

NOTES TOUNAUDITED PRO FORMA CONDENSED COMBINED CONSOLIDATED FINANCIAL STATEMENTS

1. PRELIMINARY ESTIMATED ACQUISITION PRICE ALLOCATION

The preliminary acquisition price allocation for LivingSocial Korea, Inc. is based on estimates, assumptions, and valuations which have not yet been finalized. Accordingly, the pro forma adjustments to allocate the acquisition consideration will remain preliminary until Groupon management determines the fair values of assets acquired, net of liabilities assumed. The final amounts allocated to assets acquired and liabilities assumed could differ materially from the amounts presented in the unaudited pro forma condensed combined consolidated financial statements. The preliminary amounts allocated to the net assets acquired and liabilities assumed are based on Groupon management's current best estimates. The fair values of net tangible assets acquired are expected to approximate their net carrying amounts.

The following table summarizes the preliminary allocation of the aggregate acquisition price (in thousands):

Preliminary Acquisition Price Allocation
Cash and cash equivalents	$	15,084
Accounts receivable, net	12,287
Prepaid expenses and other current assets	4,819
Property, equipment and software, net	5,819
Goodwill	231,644
Intangible Assets:
Subscriber relationships	69,000
Merchant relationships	6,600
Developed technology	200
Trade names	17,000
Other non-current assets	1,435
Total assets acquired	$	363,888
Accounts payable	$	8,099
Accrued merchant and supplier payables	64,732
Accrued expenses	14,934
Other current liabilities	807
Deferred income taxes, non-current	7,385
Other non-current liabilities	5,069
Total liabilities assumed	$	101,026
Total Acquisition Price	$	262,862

The aggregate acquisition-date fair value of the consideration transferred consisted of the following (in thousands):

Fair Value of Consideration Transferred	Fair Value
Cash Paid	$	100,000
Issuance of 13,825,283 shares of Class A common stock	162,862
Total	$	262,862

The fair value of the Groupon Class A common stock issued as consideration was measured based on the stock price upon closing of the transaction on January 2, 2014. This amount differs from the $160 million contractual price as stated in the Share Purchase Agreement, which is based on the average closing price of Groupon’s Class A common stock for the ten trading days immediately prior to close.

5

NOTES TOUNAUDITED PRO FORMA CONDENSED COMBINED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

2. ADJUSTMENTS FOR OPERATIONS NOT ACQUIRED

Groupon did not acquire a Malaysia-based subsidiary of LivingSocial Korea, Inc. Accordingly, the balances relating to that entity have been excluded from the unaudited pro forma condensed combined consolidated financial statements.

3. PRO FORMA ADJUSTMENTS TO UNAUDITED CONDENSED COMBINED CONSOLIDATED FINANCIAL STATEMENTS

The final acquisition price allocation may result in different allocations for tangible and intangible assets than presented in the unaudited pro forma condensed combined consolidated financial statements and these notes, and those differences may be material.

Balance Sheet

a. Adjustment to reflect the cash paid to the sole stockholder of LivingSocial Korea, Inc. as part of the acquisition consideration.

b. Adjustment to eliminate the historical LivingSocial Korea, Inc. goodwill of approximately $50.5 million and record preliminary goodwill created as a result of the acquisition of approximately $231.6 million.

c. Adjustment to record the preliminary fair value estimates of intangible assets resulting from the acquisition and to reverse the net book value of existing LivingSocial Korea, Inc. intangible assets. Preliminary fair values for the intangible assets were determined based on the income and cost approaches. The intangible assets acquired were trade names, developed technology, merchant relationships and subscriber relationships and are expected to be amortized on a straight-line basis over the following useful lives:

Identifiable Intangible Assets	Useful Life
Trade names	5 years
Developed technology	2 years
Merchant relationships	3 years
Subscriber relationships	5 years

d. Adjustment to record transaction costs for this acquisition that were incurred by Groupon after September 30, 2013.

e. Adjustment to eliminate the historical LivingSocial Korea, Inc. due to related parties of $14.8 million, which was not assumed in the acquisition.

f. Adjustment to record the estimated preliminary net deferred tax liability increase of $7.4 million related to the acquisition.

g. Adjustment to record common stock and additional paid-in capital related to the issuance of 13,825,283 shares of Groupon Class A common stock issued to the sole stockholder of LivingSocial Korea, Inc. as part of the acquisition consideration.

h. Adjustment to eliminate LivingSocial Korea, Inc.'s historical stockholder's equity (additional paid-in capital, investment in shares of Parent, at cost, accumulated deficit, and accumulated other comprehensive loss).

Statement of Operations

i. Adjustment to reclassify LivingSocial Korea, Inc.'s $3.4 million and $0.5 million of discount incentives for the nine months ended September 30, 2013 and the year ended December 31, 2012, respectively, from marketing expense to a reduction of revenue to conform to Groupon's presentation.

j. Adjustment to reclassify LivingSocial Korea, Inc.'s $2.1 million and $2.1 million of depreciation and amortization of property, equipment and software for the nine months ended September 30, 2013 and the year ended December 31, 2012, respectively, to selling, general and administrative expense and cost of revenue to conform to Groupon's presentation.

6

NOTES TOUNAUDITED PRO FORMA CONDENSED COMBINED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

k. Adjustment to eliminate $11.3 million and $32.5 million of historical amortization expense recorded for LivingSocial Korea, Inc.'s pre-existing intangible assets and to record $14.6 million and $19.5 million of amortization expense for the intangible assets expected to be recognized upon Groupon's acquisition of LivingSocial Korea, Inc. for the nine months ended September 30, 2013 and for the year ended December 31, 2012, respectively. The intangible assets acquired includetrade names, developed technology, merchant relationships and subscriber relationships. These intangible assets are expected to be amortized on a straight-line basis over the useful life of the underlying assets which range from 2 to 5 years.

l. Tax impact of pro forma adjustments at the Korean statutory rate.

m. Adjustment to increase the denominator of the net loss per share calculations to reflect the issuance of Groupon Class A common stock issued to the sole stockholder of LivingSocial Korea, Inc. as part of the acquisition consideration.

7