GUARANTOR AND NON-GUARANTOR FINANCIAL INFORMATION

The 2013 and 2012 Senior Notes are unconditionally guaranteed, jointly and severally, by certain domestic subsidiaries which are 100% owned by the Company. Following the closing of the Match Exchange Offer on November 16, 2015, Match Group and its subsidiaries were designated as unrestricted subsidiaries. The following tables present condensed consolidating financial information at December 31, 2015 and 2014 and for the years ended December 31, 2015, 2014 and 2013 for: IAC, on a stand-alone basis; the combined guarantor subsidiaries of IAC; the combined non-guarantor subsidiaries of IAC; and IAC on a consolidated basis.

Balance sheet at December 31, 2015:



	IAC		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations			IAC Consolidated
	(In thousands)
Cash and cash equivalents	$	1,073,053	$	—	$	408,394	$	—		$	1,481,447
Marketable securities	27,578		—		11,622		—			39,200
Accounts receivable, net	33		117,337		132,707		—			250,077
Other current assets	30,813		48,884		94,589		—			174,286
Intercompany receivables	—		570,607		1,029,863		(1,600,470		)	—
Property and equipment, net	4,432		201,242		97,143		—			302,817
Goodwill	—		830,642		1,414,722		—			2,245,364
Intangible assets, net	—		139,160		301,668		—			440,828
Investment in subsidiaries	3,128,765		457,063		1,445		(3,587,273		)	—
Other non-current assets	89,017		13,428		188,477		(14,991		)	275,931
Total assets	$	4,353,691	$	2,378,363	$	3,680,630	$	(5,202,734	)	$	5,209,950

Current portion of long-term debt	$	—	$	—	$	40,000	$	—		$	40,000
Accounts payable, trade	4,711		43,240		38,932		—			86,883
Other current liabilities	62,833		182,848		395,982		—			641,663
Long-term debt, net of current maturities	554,732		—		1,193,481		—			1,748,213
Income taxes payable	152		3,435		30,105		—			33,692
Intercompany liabilities	1,600,470		—		—		(1,600,470		)	—
Other long-term liabilities	326,267		18,160		83,847		(14,991		)	413,283
Redeemable noncontrolling interests	—		—		30,391		—			30,391
IAC shareholders' equity	1,804,526		2,130,680		1,456,593		(3,587,273		)	1,804,526
Noncontrolling interests	—		—		411,299		—			411,299
Total liabilities and shareholders' equity	$	4,353,691	$	2,378,363	$	3,680,630	$	(5,202,734	)	$	5,209,950

Balance sheet at December 31, 2014:



	IAC		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations			IAC Consolidated
	(In thousands)
Cash and cash equivalents	$	762,231	$	—	$	228,174	$	—		$	990,405
Marketable securities	159,197		—		1,451		—			160,648
Accounts receivable, net	13		137,593		98,480		—			236,086
Other current assets	20,532		55,422		72,795		—			148,749
Intercompany receivables	—		691,357		1,964,011		(2,655,368		)	—
Property and equipment, net	4,950		207,407		90,102		—			302,459
Goodwill	—		840,104		914,822		—			1,754,926
Intangible assets, net	—		243,408		248,528		—			491,936
Investment in subsidiaries	5,035,304		466,165		—		(5,501,469		)	—
Other non-current assets	44,610		13,228		113,838		—			171,676
Total assets	$	6,026,837	$	2,654,684	$	3,732,201	$	(8,156,837	)	$	4,256,885

Accounts payable, trade	$	3,059	$	50,761	$	27,343	$	—		$	81,163
Other current liabilities	73,491		187,698		331,348		—			592,537
Long-term debt	1,000,000		80,000		—		—			1,080,000
Income taxes payable	2,240		2,929		27,466		—			32,635
Intercompany liabilities	2,655,368		—		—		(2,655,368		)	—
Other long-term liabilities	300,726		59,889		76,366		—			436,981
Redeemable noncontrolling interests	—		—		40,427		—			40,427
IAC shareholders' equity	1,991,953		2,273,407		3,228,062		(5,501,469		)	1,991,953
Noncontrolling interests	—		—		1,189		—			1,189
Total liabilities and shareholders' equity	$	6,026,837	$	2,654,684	$	3,732,201	$	(8,156,837	)	$	4,256,885

Statement of operations for the year ended December 31, 2015:



	IAC			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			IAC Consolidated
	(In thousands)
Revenue	$	—		$	1,704,841		$	1,536,101		$	(10,009	)	$	3,230,933
Operating costs and expenses:
Cost of revenue (exclusive of depreciation shown separately below)	720			367,704			410,927			(1,190		)	778,161
Selling and marketing expense	3,210			852,173			499,053			(8,860		)	1,345,576
General and administrative expense	93,090			178,861			253,637			41			525,629
Product development expense	4,311			93,769			87,686			—			185,766
Depreciation	1,918			27,890			32,397			—			62,205
Amortization of intangibles	—			104,180			35,772			—			139,952
Goodwill impairment	—			14,056			—			—			14,056
Total operating costs and expenses	103,249			1,638,633			1,319,472			(10,009		)	3,051,345
Operating (loss) income	(103,249		)	66,208			216,629			—			179,588
Equity in earnings of unconsolidated affiliates	215,462			13,477			1,204			(229,371		)	772
Interest expense	(49,405		)	(6,130		)	(18,101		)	—			(73,636		)
Other (expense) income, net	(3,571		)	28,077			11,643			—			36,149
Earnings from continuing operations before income taxes	59,237			101,632			211,375			(229,371		)	142,873
Income tax benefit (provision)	60,218			(36,425		)	(53,309		)	—			(29,516		)
Earnings from continuing operations	119,455			65,207			158,066			(229,371		)	113,357
Earnings (loss) from discontinued operations, net of tax	17			—			(12		)	12			17
Net earnings	119,472			65,207			158,054			(229,359		)	113,374
Net loss attributable to noncontrolling interests	—			—			6,098			—			6,098
Net earnings attributable to IAC shareholders	$	119,472		$	65,207		$	164,152		$	(229,359	)	$	119,472
Comprehensive income attributable to IAC shareholders	$	55,069		$	61,730		$	98,323		$	(160,053	)	$	55,069

Statement of operations for the year ended December 31, 2014:



	IAC			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			IAC Consolidated
	(In thousands)
Revenue	$	—		$	1,694,844		$	1,426,542		$	(11,839	)	$	3,109,547
Operating costs and expenses:
Cost of revenue (exclusive of depreciation shown separately below)	998			438,729			423,230			(2,753		)	860,204
Selling and marketing expense	2,138			715,646			437,928			(8,303		)	1,147,409
General and administrative expense	105,221			148,026			190,318			45			443,610
Product development expense	6,496			83,216			71,631			(828		)	160,515
Depreciation	1,426			26,182			33,548			—			61,156
Amortization of intangibles	—			33,587			24,339			—			57,926
Total operating costs and expenses	116,279			1,445,386			1,180,994			(11,839		)	2,730,820
Operating (loss) income	(116,279		)	249,458			245,548			—			378,727
Equity in earnings (losses) of unconsolidated affiliates	253,582			(6,440		)	451			(257,290		)	(9,697		)
Interest expense	(51,988		)	(4,229		)	(97		)	—			(56,314		)
Other income (expense), net	2,688			12,533			(58,008		)	—			(42,787		)
Earnings from continuing operations before income taxes	88,003			251,322			187,894			(257,290		)	269,929
Income tax benefit (provision)	152,197			(98,198		)	(89,371		)	—			(35,372		)
Earnings from continuing operations	240,200			153,124			98,523			(257,290		)	234,557
Earnings from discontinued operations, net of tax	174,673			—			570			(570		)	174,673
Net earnings	414,873			153,124			99,093			(257,860		)	409,230
Net loss attributable to noncontrolling interests	—			—			5,643			—			5,643
Net earnings attributable to IAC shareholders	$	414,873		$	153,124		$	104,736		$	(257,860	)	$	414,873
Comprehensive income attributable to IAC shareholders	$	340,219		$	144,926		$	33,229		$	(178,155	)	$	340,219

Statement of operations for the year ended December 31, 2013:



	IAC			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			IAC Consolidated
	(In thousands)
Revenue	$	—		$	1,660,113		$	1,366,989		$	(4,115	)	$	3,022,987
Operating costs and expenses:
Cost of revenue (exclusive of depreciation shown separately below)	2,456			537,948			439,813			(2,860		)	977,357
Selling and marketing expense	2,563			591,543			389,801			(1,133		)	982,774
General and administrative expense	97,025			127,731			153,508			(122		)	378,142
Product development expense	4,685			77,153			57,921			—			139,759
Depreciation	1,386			27,609			29,914			—			58,909
Amortization of intangibles	—			37,890			21,953			—			59,843
Total operating costs and expenses	108,115			1,399,874			1,092,910			(4,115		)	2,596,784
Operating (loss) income	(108,115		)	260,239			274,079			—			426,203
Equity in earnings (losses) of unconsolidated affiliates	439,925			38,619			(303		)	(484,856		)	(6,615		)
Interest expense	(29,417		)	(3,957		)	(222		)	—			(33,596		)
Other (expense) income, net	(35,331		)	(18,653		)	84,293			—			30,309
Earnings from continuing operations before income taxes	267,062			276,248			357,847			(484,856		)	416,301
Income tax benefit (provision)	16,796			(81,803		)	(69,495		)	—			(134,502		)
Earnings from continuing operations	283,858			194,445			288,352			(484,856		)	281,799
Earnings (loss) from discontinued operations, net of tax	1,926			—			(39		)	39			1,926
Net earnings	285,784			194,445			288,313			(484,817		)	283,725
Net loss attributable to noncontrolling interests	—			—			2,059			—			2,059
Net earnings attributable to IAC shareholders	$	285,784		$	194,445		$	290,372		$	(484,817	)	$	285,784
Comprehensive income attributable to IAC shareholders	$	304,907		$	195,308		$	301,073		$	(496,381	)	$	304,907

Statement of cash flows for the year ended December 31, 2015:



	IAC			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			IAC Consolidated
	(In thousands)
Net cash (used in) provided by operating activities attributable to continuing operations	$	(139,227	)	$	235,424		$	253,208		$	349,405
Cash flows from investing activities attributable to continuing operations:
Acquisitions, net of cash acquired	—			(6,078		)	(611,324		)	(617,402		)
Capital expenditures	(1,332		)	(23,628		)	(37,089		)	(62,049		)
Proceeds from maturities and sales of marketable debt securities	218,462			—			—			218,462
Purchases of marketable debt securities	(93,134		)	—			—			(93,134		)
Proceeds from sales of long-term investments and a business	1,277			—			8,136			9,413
Purchases of long-term investments	(6,978		)	—			(27,492		)	(34,470		)
Other, net	3,613			(364		)	(6,790		)	(3,541		)
Net cash provided by (used in) investing activities attributable to continuing operations	121,908			(30,070		)	(674,559		)	(582,721		)
Cash flows from financing activities attributable to continuing operations:
Borrowings under Match Group Term Loan	—			—			788,000			788,000
Debt issuance costs	(1,876		)	—			(17,174		)	(19,050		)
Fees and expenses related to note exchange	—			—			(6,954		)	(6,954		)
Principal payments on long-term debt	—			(80,000		)	—			(80,000		)
Proceeds from Match Group initial public offering, net of fees and expenses	—			—			428,789			428,789
Purchase of treasury stock	(200,000		)	—			—			(200,000		)
Dividends	(113,196		)	—			—			(113,196		)
Issuance of common stock, net of withholding taxes	(38,418		)	—			—			(38,418		)
Repurchase of stock-based awards	—			—			(23,431		)	(23,431		)
Excess tax benefits from stock-based awards	18,034			—			38,384			56,418
Purchase of noncontrolling interests	—			—			(32,207		)	(32,207		)
Acquisition-related contingent consideration payments	—			(240		)	(5,510		)	(5,750		)
Intercompany	683,571			(125,114		)	(558,457		)	—
Other, net	(19,834		)	—			441			(19,393		)
Net cash provided by (used in) financing activities attributable to continuing operations	328,281			(205,354		)	611,881			734,808
Total cash provided by continuing operations	310,962			—			190,530			501,492
Total cash used in discontinued operations	(140		)	—			(12		)	(152		)
Effect of exchange rate changes on cash and cash equivalents	—			—			(10,298		)	(10,298		)
Net increase in cash and cash equivalents	310,822			—			180,220			491,042
Cash and cash equivalents at beginning of period	762,231			—			228,174			990,405
Cash and cash equivalents at end of period	$	1,073,053		$	—		$	408,394		$	1,481,447

Statement of cash flows for the year ended December 31, 2014:



	IAC			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			IAC Consolidated
	(In thousands)
Net cash (used in) provided by operating activities attributable to continuing operations	$	(109,745	)	$	326,206		$	207,587		$	424,048
Cash flows from investing activities attributable to continuing operations:
Acquisitions, net of cash acquired	—			(100,683		)	(158,708		)	(259,391		)
Capital expenditures	(1,843		)	(27,755		)	(27,635		)	(57,233		)
Proceeds from maturities and sales of marketable debt securities	21,644			—			—			21,644
Purchases of marketable debt securities	(175,826		)	—			—			(175,826		)
Proceeds from sales of long-term investments and a business	—			—			58,388			58,388
Purchases of long-term investments	(4,800		)	(2,087		)	(17,447		)	(24,334		)
Other, net	(2,000		)	11			(1,053		)	(3,042		)
Net cash used in investing activities attributable to continuing operations	(162,825		)	(130,514		)	(146,455		)	(439,794		)
Cash flows from financing activities attributable to continuing operations:
Debt issuance costs	(383		)	—			—			(383		)
Dividends	(97,338		)	—			—			(97,338		)
Issuance of common stock, net of withholding taxes	1,609			—			—			1,609
Excess tax benefits from stock-based awards	29,186			—			15,771			44,957
Purchase of noncontrolling interests	—			—			(33,165		)	(33,165		)
Acquisition-related contingent consideration payment	—			(736		)	(7,373		)	(8,109		)
Funds transferred to escrow for Meetic tender offer	—			—			12,354			12,354
Intercompany	321,192			(193,672		)	(127,520		)	—
Other, net	—			(1,310		)	405			(905		)
Net cash provided by (used in) financing activities attributable to continuing operations	254,266			(195,718		)	(139,528		)	(80,980		)
Total cash used in continuing operations	(18,304		)	(26		)	(78,396		)	(96,726		)
Total cash used in discontinued operations	(116		)	—			(29		)	(145		)
Effect of exchange rate changes on cash and cash equivalents	—			26			(13,194		)	(13,168		)
Net decrease in cash and cash equivalents	(18,420		)	—			(91,619		)	(110,039		)
Cash and cash equivalents at beginning of period	780,651			—			319,793			1,100,444
Cash and cash equivalents at end of period	$	762,231		$	—		$	228,174		$	990,405

Statement of cash flows for the year ended December 31, 2013:



	IAC			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			IAC Consolidated
	(In thousands)
Net cash (used in) provided by operating activities attributable to continuing operations	$	(84,317	)	$	336,453		$	158,825		$	410,961
Cash flows from investing activities attributable to continuing operations:
Acquisitions, net of cash acquired	—			(1,356		)	(39,078		)	(40,434		)
Capital expenditures	(1,387		)	(54,377		)	(24,547		)	(80,311		)
Proceeds from maturities and sales of marketable debt securities	12,502			—			—			12,502
Proceeds from sales of long-term investments and assets	7,839			—			75,252			83,091
Purchases of long-term investments	(17,814		)	—			(33,266		)	(51,080		)
Other, net	—			220			(3,749		)	(3,529		)
Net cash provided by (used in) investing activities attributable to continuing operations	1,140			(55,513		)	(25,388		)	(79,761		)
Cash flows from financing activities attributable to continuing operations:
Debt issuance costs	(7,399		)	—			—			(7,399		)
Proceeds from issuance of long-term debt	500,000			—			—			500,000
Principal payments on long-term debt	(15,844		)	—			—			(15,844		)
Purchase of treasury stock	(264,214		)	—			—			(264,214		)
Dividends	(79,189		)	—			—			(79,189		)
Issuance of common stock, net of withholding taxes	(5,077		)	—			—			(5,077		)
Excess tax benefits from stock-based awards	21,317			—			11,574			32,891
Purchase of noncontrolling interests	—			—			(67,947		)	(67,947		)
Acquisition-related contingent consideration payments	—			(256		)	—			(256		)
Funds transferred to escrow for Meetic tender offer	—			—			(71,512		)	(71,512		)
Intercompany	216,730			(279,779		)	63,049			—
Other, net	—			(917		)	(2,870		)	(3,787		)
Net cash provided by (used in) financing activities attributable to continuing operations	366,324			(280,952		)	(67,706		)	17,666
Total cash provided by (used in) continuing operations	283,147			(12		)	65,731			348,866
Total cash used in discontinued operations	(1,828		)	—			(49		)	(1,877		)
Effect of exchange rate changes on cash and cash equivalents	—			12			3,466			3,478
Net increase in cash and cash equivalents	281,319			—			69,148			350,467
Cash and cash equivalents at beginning of period	499,332			—			250,645			749,977
Cash and cash equivalents at end of period	$	780,651		$	—		$	319,793		$	1,100,444