##### Table of Contents

---

SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549

---

FORM 10-K

FOR ANNUAL AND TRANSITION REPORTS PURSUANT TO SECTIONS 13
OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

|(Mark One)                                                               
|-------------------------------------------------------------------------
|x                                                                        
|                                                                         
|For the fiscal year ended: December 31, 2002                             
|                                                                         
|                                                                         
|                                                                         
|o                                                                        
|                                                                         
|For the transition period from ___________________ to ___________________
|                                                                         
|Commission file number: 0-23337                                          
|                                                                         
|SPORTSLINE.COM, INC.                                                     
|(Exact name of registrant as specified in its charter)                   
|                                                                         
|Delaware                                                                 
|(State or other jurisdiction of incorporation or organization)           
|                                                                         
|2200 W. Cypress Creek Road Fort Lauderdale, Florida                      
|(Address of principal executive offices)                                 
|                                                                         
|Registrants telephone number, including area code:  (954) 351-2120      
|                                                                         
|Securities registered pursuant to Section 12(b) of the Act:  NONE        
|                                                                         
|Securities registered pursuant to Section 12(g) of the Act:              
|                                                                         
|Common Stock (par value $.01 per share)                                  
|(Title of Class)                                                         
|                                                                         

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities
Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

|Yes x | No o
|----- | ----

Indicate by check
mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrants knowledge, in definitive proxy or information statements incorporated by reference in
Part III of this Form 10-K or any amendment to this Form 10-K. x

Indicate by check mark whether the registrant is
an accelerated filer (as defined in Rule 12b-2 of the Act).

|Yes o | No x
|----- | ----

The aggregate
market value of shares of Common Stock held by non-affiliates of the Registrant as ofJune 28, 2002, the last trading day of the Registrants most recently completed second fiscal quarter, was approximately $33,762,686 based on the $1.03 closing
price for the Common Stock on The Nasdaq National Market on such date.  For purposes of this computation, all executive officers and directors of the registrant have been deemed to be affiliates.  Such determination should not be deemed to
be an admission that such directors and officers are, in fact, affiliates of the registrant.

The number of shares of Common Stock of the registrant outstanding as of
March 24, 2003 was 38,060,986.

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the
registrants definitive Proxy Statement relating to its 2003 Annual Meeting of Stockholders, to be filed with the Securities and Exchange Commission not later than 120 days after the end of the fiscal year covered by this report, are
incorporated by reference into Part III of this report.

---



---

##### Table of Contents

Index to Items

|         |          |                                                                                       | Page
|-------- | -------- | ------------------------------------------------------------------------------------- | ----
|         |          |                                                                                       |     
|PART I   |          |                                                                                       |     
|         |          |                                                                                       |     
|         | Item 1.  | Business                                                                              | 3   
|         | Item 2.  | Properties                                                                            | 15  
|         | Item 3.  | Legal Proceedings                                                                     | 15  
|         | Item 4.  | Submission of Matters to a Vote of Security Holders                                   | 16  
|         |          |                                                                                       |     
|PART II  |          |                                                                                       |     
|         |          |                                                                                       |     
|         | Item 5.  | Market for the Registrants Common Equity and Related Stockholder Matters             | 17  
|         | Item 6.  | Selected Financial Data                                                               | 18  
|         | Item 7.  | Managements Discussion and Analysis of Financial Condition and Results of Operations | 19  
|         | Item 7A. | Quantitative and Qualitative Disclosure About Market Risk                             | 41  
|         | Item 8.  | Financial Statements and Supplementary Data                                           | 42  
|         | Item 9.  | Changes in and Disagreements with Accountants on Accounting and Financial Disclosure  | 74  
|         |          |                                                                                       |     
|PART III |          |                                                                                       |     
|         |          |                                                                                       |     
|         | Item 10. | Directors and Executive Officers of the Registrant                                    | 75  
|         | Item 11. | Executive Compensation                                                                | 75  
|         | Item 12. | Security Ownership of Certain Beneficial Owners and Management                        | 75  
|         | Item 13. | Certain Relationships and Related Transactions                                        | 75  
|         | Item 14. | Controls and Procedures                                                               | 75  
|         |          |                                                                                       |     
|PART IV  |          |                                                                                       |     
|         |          |                                                                                       |     
|         | Item 15. | Exhibits, Financial Statement Schedules, and Reports on Form 8-K                      | 76  

2



---

##### Table of Contents

PART I

Item 1.    Business.

Certain statements contained in this Annual Report on Form 10-K, including, without limitation, statements containing the words
believes, anticipates, estimates, expects, and words of similar import, constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Readers are
referred to the Risk Factors section of the Managements Discussion and Analysis of Financial Condition and Results of Operations contained herein, which identifies important risk factors that could cause actual results
to differ materially from those contained in the forward looking statements.

SportsLine.com, Inc.
(together with its subsidiaries, SportsLine or the Company) publishes one of the most comprehensive collections of multimedia sports news and information available on the Internet and offers consumers a broad assortment of
merchandise and subscription and premium services, including fantasy leagues and contests.  SportsLine offers advertisers the opportunity to reach its audience through marketing solutions that include sponsorships, advertising and direct
marketing services.

The Company has established a number of important strategic relationships to
increase awareness of the SportsLine brand, build traffic to its Web sites and develop proprietary programming. SportsLine has strategic relationships with, among others, CBS Broadcasting Inc. (CBS), the National Football League (the
NFL), the National Collegiate Athletic Association (the NCAA), the PGA TOUR, Westwood One and the National Basketball Association (the NBA) and serves as a primary sports content provider for America Online, Inc.
(AOL).  See  Strategic Relationships.

Sports Information, Programming and Distribution

SportsLine offers a broad range of sports-related information and programming, which it delivers through its network of Web sites and
other distribution channels.

Information and Programming

| | News and Editorials          | The Companys news organization provides up-to-date general sports news and information for all major professional and college sports 24 hours a day, seven days a week,
including previews, game summaries, audio and video clips and color photographs, obtained from strategic partners such as CBS and a variety of leading sports news organizations such as Associated Press and Getty Images.  The Company also
publishes exclusive editorials and analyses from its in-house staff of writers and editors and freelance sports journalists.
| | ---------------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |                              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| | Scores and Statistics        | The Company delivers continuously updated, real-time scores, schedules, standings and player and team statistics for all major professional and college sports from data
providers including Associated Press and Elias Sports Bureau as well as from in-house staff updates.                                                                                                                                                                                                                                                                      
| |                              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| | Fantasy Leagues and Contests | Fantasy league enthusiasts can participate in SportsLine-administered leagues or form their own leagues with customized rules, live scoring and reporting.  The Company
administers player transactions (e.g., drafts, trades, starting lineup selection and disabled list and minor league moves) and provides summaries of scoring, standings and roster transactions.  Proprietary contests feature cash prizes, limited
edition sports memorabilia and other                                                                                   

3



---

##### Table of Contents

| |                                | awards based on the results of weekly, season-long or special event related games of skill.  Regular sweepstakes and giveaways feature cash prizes, sports
memorabilia, event tickets and other merchandise.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| | ------------------------------ | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| | Wireless                       | The Company delivers a subset of its content to wireless users of digital cellular phones, Web enabled cellular phones and personal digital assistant devices (PDAs).
Users opt in for notifications to their device of NBA, NCAA basketball, NCAA football, NFL, NHL, MLB, golf, auto racing and tennis scoring and headline alerts. The Company also produces content specifically for Web enabled cellular phones and PDAs,
such as headlines, scores, injuries, transactions, standings and schedules for the above sports, as well as auto racing.  The Company provides users of its fantasy products with the ability to (i) receive various short message service
(SMS) notifications on their wireless devices, such as player updates, a lineup reminder, and various league transactions and (ii) access live scoring, schedules, and statistics via a WAP-enabled device.
| |                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| | Local and Personalized Content | The Company packages its information and programming to enable users to follow local or regional team and event coverage, including weekly stories from college sports
publications and team coverage from staff writers strategically located in cities across the nation.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| |                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| | Audio                          | The Companys radio studio produces live sports updates for the Westwood One Radio Network and tapes and edits audio for streaming throughout the CBS SportsLine Web site,
including interviews with superstars, notable sports personalities and regular commentary from leading sports analysts.  The Company also produces and distributes audio clips of interviews, press conferences and other audio surrounding major
sporting events from various sources, including Associated Press and CBS Newspath.                                                                                                                                                                                                                                                                                                                                                                          
| |                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| | Video                          | The Company delivers video programming surrounding major sports events and daily video clips covering major events such as the Super Bowl and the NCAA Mens Basketball
Championship. The Company also distributes video highlights from the NFL, the PGA TOUR, CBS Sports and other sources.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| |                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| | Odds and Consulting            | The Companys vegasinsider.com Web site delivers electronic odds on all major sports events from major Las Vegas casinos, including the Stardust, the MGM Mirage,
Caesars-Hilton, and Harrahs/The Rio, plus lines from nationally recognized oddsmakers.  Additionally, the Company provides consulting services to certain Las Vegas casinos.  On February 26, 2003, the Company announced its intention
to dispose of its gaming information operations.  See  Managements Discussion and Analysis of Financial Condition and Results of OperationsRecent Developments.                                                                                                                                                                                                                                                                                                          

Web Sites

cbs.sportsline.com, the Companys flagship Web site, features comprehensive, in-depth coverage of all major professional and
college sports on a domestic and international basis.  The cbs.sportsline.com Web site offers fantasy sports products for all major sports including NFL, MLB, NBA, NHL, PGA Tour and NASCAR.  See  Subscription and Premium
Products.  cbs.sportsline.com has won numerous awards since its initial launch in 1996.

4



---

##### Table of Contents

Recent awards include Best Sports website in the WebAward competition by the Web Marketing Association (2002); One of 50 Best Web sites by Time Magazine (2002); Best Fantasy
Sports site from Yahoo! Internet Lifes 100 Best Sites of 02 (2002); Horizon Awards Top Sports Web Site of the Year and Sports Business Impact Partnership of the Year (2001); one of the top 100
innovative high-tech companies from Info World 100 (2001); Top Fantasy Baseball site, Los Angeles Times (2001); Outstanding Achievement in Web Site Development, Web Marketing Association (2001); Horizon Awards Top Sports Business Website
Marketing Campaign of the Year (2000); The Top 100 Web sites, P.O.V. Magazine (2000); Top NFL Web site by Access Magazine (2000); San Francisco Chronicle Best of the Web 2000; an Outstanding Web site by the Web Marketing Association (2000);
Best Football Site from Yahoo! Internet Life (2000); and The Top 100 Web Sites, PC Magazine (2000).

NFL.com, produced by SportsLine in association with the NFL and in partnership with AOL and CBS, is the leagues official
Web site and the anchor of the NFL Internet Network, which includes NFL.com, the 32 NFL team Web sites and other related Web sites, including superbowl.com, playfootball.com and nfleurope.com. The NFL.com site delivers complete coverage of the NFL
and its players with state-of-the-art technology, live scoring and play-by-play, audio and video streaming from NFL Films and a fantasy football product suite.  Additionally, the site provides access to the teams and players with
behind-the-scenes features, news and analysis. The NFL.com site was honored with the Horizon Award as the Top League Web Site of the Year for 2001.

golfweb@pgatour.com, produced by the Company in association with the PGA TOUR, is a comprehensive golf site that offers the only
full leaderboard real-time scoring on the Internet from the PGA TOUR, CHAMPIONS TOUR and NATIONWIDE TOUR events.  The site also features news covering other golf organizations and international tours.  Additionally, the pgatour.com site
focuses on recreational golf, travel opportunities and golf instruction and features a variety of interactive tools such as course guides and reviews.  The site also contains exclusive features such as Live@17, a video transmission of one hole
of a PGA TOUR tournament; and TOURCast, which allows users to view specific details such as distance and location of each shot of every golfer in a tournament.  The pgatour.com site also features the PGA TOUR SHOP, the official
online pro shop of the PGA TOUR offering a complete line of golf equipment, accessories, apparel and other products, including PGA TOUR branded merchandise.  The site also incorporates the Companys golfweb.com site, which provides
golf-related content, interactive entertainment, membership services, golf course discounts and merchandise.

NCAASports.com, produced by SportsLine pursuant to a sublicense of rights from CBS, is the official Web site of NCAA championship
events.  The NCAASports.com site features in-depth coverage of all championship events administered by the NCAA and a vast array of year-round content including student-athlete features, standings, stats, brackets, event results and on-site
championship information, including tickets, local events and activities.

mvp.com is a
state-of-the-art comprehensive sports-oriented retail Web site that offers consumers the opportunity to purchase thousands of licensed products, memorabilia and sporting goods.  See Merchandise.

vegasinsider.com provides sports gaming information and features electronic odds on all major sports events from major Las Vegas
casinos, including the Stardust, the MGM Mirage, Caesars-Hilton, and Harrahs/The Rio, plus lines from nationally recognized oddsmakers.  Handicapping information includes commentary, matchup analysis and picks from some of the
nations leading sports handicappers.  The sites news reporting is focused on a gaming perspective and provides detailed statistical and matchup analysis tools, including against-the-spread and straight-up
records, team and player statistics and injury and weather reports.  Live scoreboards provide breaking news and scores, updates, recaps and boxscores.  On February 26, 2003, the Company announced its intention to dispose of its gaming
information operations, including the vegasinsider.com Web site.  See  Managements Discussion and Analysis of Financial Condition and Results of OperationsRecent Developments.

Other League Web Sites. SportsLine has created Web sites for sports organizations and major sports events, including
superbowl.com (for Super Bowl XXXV, XXXVI and XXXVII), usopen.org (for the US Open Tennis Championship in 2001) and pgachampionship.com (for the PGA Championship in 2000 and 2001).

5



---

##### Table of Contents

SportsLine is responsible for the technical development, production and maintenance
of the Web sites it creates for third parties, as well as customer service, technical support and billing associated with the sale of premium features or merchandise. SportsLines third party Web site agreements are for terms ranging from one
to five years and generally provide SportsLine the exclusive right to create a Web site for a sports league, superstar, personality or organization as well as to receive certain content for the Web site and, in some cases, to use the league, athlete
or organizations name, logos and other materials to promote the Companys business and products.  In consideration for the rights granted under its third party Web site agreements, SportsLine has, in certain instances, issued shares
or warrants to purchase shares of Common Stock and/or agreed to make cash payments.  The Company generally is entitled to receive a percentage of the sponsorship, advertising and other revenue generated from the third party Web sites it
develops.

Other Distribution Channels

The inclusion of the Companys content in AOLs services makes the Companys sports content and programming readily
accessible to Web users that access the Internet via the AOL platform.   See Strategic RelationshipsAOL.  The Company, in partnership with the Westwood One Radio Network, had two radio programs in syndication
as of December 31, 2002: NFL Today, broadcast in approximately 150 markets and NFL Sunday, broadcast in approximately 175 markets.

Strategic
Relationships

SportsLine has established strategic relationships to provide marketing, e-commerce and
cross-promotional opportunities to increase consumer awareness of the SportsLine brand and other brands owned by the Company, to build traffic on its Web sites and to obtain exclusive sports content for its Web sites.

CBS.  In March 1997, the Company entered into a strategic alliance with CBS pursuant to which the Companys flagship
Web site was renamed cbs.sportsline.com.  The term of the agreement, as amended, runs through 2006.  The agreement provides for cbs.sportsline.com to receive, among other things, extensive network television advertising and
on-air promotion, primarily during CBS television sports broadcasts of events such as the NFL, the NCAA Mens Basketball Championship, NCAA Football, PGA TOUR events and U.S. Open tennis.  In addition, the Company has the right to use
certain CBS logos and television-related sports content on cbs.sportsline.com and in connection with the operation and promotion of that Web site.  CBS and the Company seek to maximize SportsLines advertising sales revenue through a joint
advertising sales effort.

PGA TOUR.In April 1999, the Company entered into an
exclusive agreement to align the pgatour.com and golfweb.com Web sites and co-produce a comprehensive golf site providing real-time scoring, golf news and information regarding recreational golf, travel opportunities and golf instruction.  The
Company and the PGA TOUR have combined resources to develop sales and sponsorship opportunities and share revenues from the combined site.   This agreement expires at the end of 2003.

NFL.  In July 2001, SportsLine entered a four-party, multi-year agreement with NFL Enterprises, L.P., CBS and AOL
encompassing a wide-range of initiatives, including the production and hosting by SportsLine of NFL.com, the most popular sports league Web site. SportsLine was given the designation of official online sports partner of the NFL and
benefits in its marketing efforts from the use of official NFL marks and logos and other league assets.  The cbs.sportsline.com site is prominently promoted on the NFL Internet Network, and receives selected NFL content for use on
cbs.sportsline.com, including four video clips a week, an audio game of the week, contests and sweepstakes.

SportsLine manages media sales and direct marketing services for NFL.com and related sites.  In addition to producing NFL.com, the
Company produces other NFL-related sites, such as superbowl.com, playfootball.com, and nfleurope.com, as well as the official fantasy football games for the sites. SportsLine also hosts and sells certain NFL content, such as NFL Films video, within
the team sites. SportsLine, the NFL, CBS and AOL have also agreed to jointly explore a range of potential new business ventures in technology-based media.

6



---

##### Table of Contents

NCAA.  In February 2003, SportsLine entered into an agreement with CBS
whereby SportsLine sublicensed the rights for the official NCAA Championship Web site, in their entirety, through 2006. These rights include site production, hosting and management of the sale of advertising for NCAASports.com, and the exclusive
rights to provide Internet broadcasts of certain NCAA championships including the Division 1 Mens Basketball Championship.  CBS received the NCAAs Internet rights, beginning in 2003, as part of its long-term arrangement with the
NCAA that includes coverage of the Division I Mens Basketball Championship and approximately 65 other championships, as well as radio, corporate marketing, licensing, publishing and special events rights.

AOL.  In July 1997, SportsLine entered into a strategic programming and distribution agreement with AOL pursuant to which
cbs.sportsline.com became the first anchor tenant on the AOL service.  In October 1998, SportsLine and AOL significantly expanded their online relationship to provide SportsLine-produced sports news and statistics, special features,
major event coverage and merchandise on several key AOL brands around the world.  In July 2001, SportsLine and AOL entered into a multi-year extension to the agreement, pursuant to which SportsLine remains an anchor tenant on the AOL Sports
Channel, giving it access to AOLs more than 30 million members.  Additionally, SportsLine receives extensive promotion across key America Online interactive brands, including Netscape, Compuserve, Digital City and ICQ.  SportsLine
also provides private label fantasy sports game products to AOL and sells advertising and sponsorships in connection with those games, including NFL fantasy products produced in association with the NFL, and fantasy games for professional baseball,
basketball, hockey, golf and auto racing, as well as college basketball tournament brackets contests.

GSI Commerce, Inc.  In July 2002, the Company entered into an e-commerce relationship with GSI Commerce, Inc.
(GSI) under which GSI was named the exclusive operator of the Companys online store, operated under the MVP.com brand name.  Under the five-year agreement, GSI manages certain components of the store, including customer
service, order processing and fulfillment.   The Company oversees the merchandising and marketing of the store.

Westwood One.In August 1999, the Company entered into a three-year agreement with Westwood One.  Under this
agreement, the Company produces sports content for Westwood One/CBS Radio Sports coverage of live sporting events.  In addition, Westwood One was granted the right to syndicate the Companys radio programs (NFL Today and
NFL Sunday).  In August 2002, the Company extended its programming and promotional agreement with Westwood One through July 2005.

Sports Superstars.  The Company has established strategic relationships with sports superstars and personalities, including
Michael Jordan, Tiger Woods, Joe Namath and Shaquille ONeal.

Advertising and Marketing Services

The Company believes that the demographics of its audience are similar to traditional sports advertisers target market. 
Based on Company-sponsored market research, users of SportsLines United States-targeted Web sites are predominantly male, 75% are between the ages of 25 to 54, 87% have attended college and 47% have an annual income greater than $75,000.

The Company currently derives, and expects to continue to derive, a substantial portion of its revenue
from advertising on Web sites.  The Company sells sponsorship opportunities that enable advertisers to associate their corporate messages with the Companys coverage of athletes and marquee events (such as the Super Bowl, the NCAA
Mens Basketball Championship, tennis and golfs major events, the NBA playoffs and the Stanley Cup playoffs), its fantasy sports products, special features of the Companys Web sites (including GameCenters and live scoring
applications) and special promotions, contests and events. In addition, the Company sells banner advertisements that allow interested readers to link directly to the advertisers own Web sites or to promotional sites created by
SportsLine.  SportsLine targets as advertisers on its Web sites traditional sports advertisers, such as consumer product and service companies, technology companies, sporting goods manufacturers and automobile companies.

7



---

##### Table of Contents

Advertising revenue is generally derived from short-term advertising contracts on a
per-impression basis or for a fixed fee based on a minimum number of impressions. SportsLines advertising rates generally range from $5.00 to $30.00 per thousand impressions.  To enable advertisers to verify the number of impressions
received by their advertisements and monitor their advertisements effectiveness, the Company provides its advertisers with third party audit reports showing data on impressions received by their advertisements.

The Company has developed its database marketing capabilities to offer its advertisers more targeted means to reach sports fans. 
SportsLine has developed its direct marketing database by leveraging its registration process for fantasy products, memberships, contests and other products and services.  The Company had approximately 10.5 million registered users as of
December 31, 2002. Current programs in place include direct e-mail campaigns as well as cost-per-lead-generation campaigns that are promoted on registration pages.

SportsLines in-house sales staff develops and implements its advertising strategies, including identifying strategic accounts and
developing presentations and promotional materials.  The Company has sales personnel located in Fort Lauderdale, New York, Chicago, San Francisco, Los Angeles, Atlanta and Detroit.  The Company also capitalizes on its cross-marketing
relationships with sports superstars, personalities, organizations and affinity groups by seeking sponsorships and advertisements from their sponsors.  The Company coordinates its advertising sales efforts for cbs.sportsline.com with CBSs
television network advertising sales personnel.

No customer accounted for more than 9% of the
Companys revenue during 2002 or 2001.

Subscription and Premium Products

The Company offers fantasy products for professional football, baseball, basketball, hockey, golf and auto racing.  These fantasy
products allow members to form their own team by assembling a group of athletes from a sport and following their performance on a weekly or daily basis.  These fantasy teams can then perform in competitions administered by the Company for cash
or merchandise prizes, or compete in leagues administered by the users on the Companys Web site.

The Companys fantasy sports products are offered for all major sports including NFL, MLB, NBA, NHL, PGA TOUR and NASCAR. The
Companys top-selling fantasy league management service is offered for use during the NFL, MLB, NBA and NHL seasons. Leagues are charged a fee for each sport in which they participate. Single team purchases are also available, and are managed
by Company representatives. Fantasy challenge games are selectively made available. These competitions allow all participants to compete against the entire game population for a grand prize.

From July 2000 to July 2001, the Company offered its fantasy products and services as a free service. Offering fantasy products for free
allowed the Company to showcase its league management service to a broad audience of fantasy players who had either only played free games before or had never played in a fantasy game online.  As a result of this strategy, the Company attracted
more than four million fantasy products customers in 2001, firmly establishing SportsLine as a clear leader in fantasy sports offerings.   After July 2001, the Company converted its free fantasy products back to primarily pay services,
with select challenge and other games made available for free from time to time.   Offerings include a league management service currently priced at $139.95 or individual fantasy teams, placed in a league, ranging in price from $9.95 to
$249.95, based on prizes and type of game. During 2002, more than 80,000 paid fantasy leagues representing about one million teams were formed in the Companys fee-based baseball, football, basketball and hockey fantasy games. In addition, the
total number of teams in all of the Companys fantasy sports products for 2002 was in excess of five million, including products managed by the Company for AOL, NFL.com and si.com.

Memberships

The Company currently offers two versions of its core loyalty
program. SportsLine Rewards is free to members and SportsLine Rewards Plus is available for a fee of $39.95 per year. Both programs allow members to earn points by visiting the cbs.sportsline.com Web site, becoming more involved in membership
offerings, referring others

8



---

##### Table of Contents

to register and clicking on sponsors advertisements. Members can redeem accumulated points in exchange for merchandise in the SportsLine Rewards catalog or by
participating in auctions for a variety of goods and services. SportsLine Rewards Plus members receive enhanced program benefits such as double points for visiting the cbs.sportsline.com site, access to exclusive contests and the ability to redeem
points in exclusive auctions.

Through its membership programs, the Company has established an
extensive database of members who exhibit increased media consumption (visit frequency and page views) due to their intense usage of the Companys membership products and services. The membership list is also one of companys key assets in
terms of both internal list marketing and external direct marketing services. Core membership products include web site customization offerings and a wide variety of contests. All membership benefits require registration and many are offered free of
charge. In addition, the Companys fantasy sports products require registration to participate and users become part of the Companys database of members.

The Company offers members the ability to customize its Web site in two ways. On the cbs.sportsline.com Web site, members can enter
their favorite (and despised) teams and players along with their zip code. Given these preferences, the Web site is tailored to highlight information specific to the members team and player preferences. The members zip code is used to
translate all schedule information into their local time zone.  Members who desire more control over their cbs.sportsline.com experience can design their own personal sports Web pages using My SportsLine. This product allows the
user to manage the content, layout and page settings of the site. Both customization offerings are intended to make the cbs.sportsline.com visitor experience more efficient and effective.

The Company also provides the opportunity for registered users to participate in contests and sweepstakes in which the user can win
cash, trips or merchandise. In many cases, an advertiser sponsors these contests and sweepstakes.

Merchandise

In July 2002, the Company entered into a five-year e-commerce relationship with GSI under which GSI was named the exclusive operator of
the Companys online store, marketed under the MVP.com brand name.  GSI provides inventory and conducts sales on the MVP.com Web site and pays a revenue share to the Company which is included in advertising and marketing services
revenue.  In January 2001, following the cessation of business operations by MVP.com, Inc., the sports and outdoor e-commerce company that had previously acquired and agreed to operate SportsLines domestic e-commerce business, SportsLine
acquired certain assets of MVP.com, Inc., including the domain names, trademarks and certain other assets associated with the Web sites mvp.com, planetoutdoors.com, igogolf.com, golfclubtrader.com and tennisdirect.com.

Marketing

The Companys agreement with CBS provides for
cbs.sportsline.com to receive extensive network television advertising and on-air promotion, primarily during CBS television broadcasts of sports events such as the NFL, the NCAA Mens Basketball Championship, NCAA Football, PGA TOUR events and
U.S. Open tennis.  In addition, CBS will provide on-air promotion for NCAASports.com, produced by SportsLine, during its telecasts of NCAA championships.  NFL.com, which is produced by the Company and has direct links to
cbs.sportsline.com, receives significant on-air promotion during all televised broadcasts of NFL games, including broadcasts on ABC, ESPN and Fox. PGATOUR.com, which is produced by the Company and has direct links to cbs.sportsline.com, receives
significant on-air promotion during all televised broadcasts of PGA TOUR events, including broadcasts on ABC, NBC, ESPN, Fox SportsNet, USA Networks, TNT, Golf Channel and CNBC. The Companys agreement with Westwood One Radio Network provides
the Company with extensive on-air promotion and live reads during radio broadcasts of the NFL, NCAA Football, Notre Dame Football and HBO Boxing and during other special events, such as the U.S. Open and Masters golf tournaments.

Under the terms of the Companys multi-year agreement with AOL, cbs.sportsline.com is an anchor tenant on the AOL Sports
Channel and receives extensive promotion across key AOL interactive brands, including Netscape, Compuserve, Digital City and ICQ.  Pursuant to the anchor tenancy agreement, the CBS SportsLine.com

9



---

##### Table of Contents

brand is promoted to AOLs more than 30 million members, each of whom have instant access to the Companys comprehensive coverage of the sports world through
cbs.sportsline.coms continuous presence on the main screen of the AOL Sports Channel. The Companys features and programming are also integrated throughout the AOL Sports Channels aggregated sports areas.

Another effective marketing outlet for the Company has been online advertising. The Company, from time to time, purchases
advertising impressions on leading web sites. In addition the Company purchases paid listings on major search engines to promote its fantasy sports products. SportsLine also advertises using direct e-mail, targeted print publications, stadium
signage, outdoor billboards, and sports talk radio.

Member Service and Support

The Company believes that member service and support are important to its ability to attract and retain members.  The
Companys member services staff provides telephone and continuous e-mail support, responds to customer requests concerning technical aspects of SportsLines Web sites and certain third party software and conducts inbound and outbound
telemarketing on a 16 hour a day, seven day a week basis.

Competition

The market for Internet services and products is highly competitive and the Company expects that competition will continue to
intensify.  SportsLine competes, directly and indirectly, for advertisers, viewers, members, content providers, merchandise sales and rights to sports events with the following categories of companies: (i) Web sites targeted to sports
enthusiasts generally (such as espn.com, si.com, sports.yahoo.com and foxsports.com) or to enthusiasts of particular sports (such as Web sites maintained by the NBA, MLB and the NHL); (ii) publishers and distributors of traditional off-line media
(such as television, radio and print), including those targeted to sports enthusiasts, many of which have established or may establish Web sites; (iii) general purpose consumer online services such as AOL and MSN, each of which provides access to
sports-related content and services; (iv) vendors of sports information, merchandise, products and services distributed through other means, including retail stores, mail, facsimile and private bulletin board services; and (v) Web search and
retrieval services, such as Google, Lycos, Netscape and Yahoo!, and other high-traffic Web sites.   Management believes that SportsLines most significant competitors are espn.com, Yahoo! Sports, AOL Sports, foxsports.com and si.com,
all of which offer a variety of sports content.

The Company believes that the principal competitive factors
in attracting and retaining users and members are the depth, breadth and timeliness of content, the ability to offer compelling and entertaining content and brand recognition.  Other important factors in attracting and retaining users include
ease of use, service quality and cost.  The Company believes that the principal competitive factor in attracting and retaining content providers and merchandisers is SportsLines ability to offer sufficient incremental revenue from
licensing fees, bounties and online sales of product or services.  The Company believes that the principal competitive factors in attracting advertisers include the number of users and members of SportsLines Web sites, the demographics of
SportsLines user and membership bases, price and the creative implementation of advertisement placements.  There can be no assurance that the Company will be able to compete favorably with respect to these factors.

Certain current and potential competitors of SportsLine have longer operating histories, significantly greater financial,
technical and marketing resources, significantly greater name recognition and substantially larger user or membership bases than SportsLine and, therefore, have a significantly greater ability to attract advertisers and users.  In addition,
many of these competitors may be able to respond more quickly than the Company to new or emerging technologies and changes in Internet user requirements and to devote greater resources than the Company to the development, promotion and sale of their
services.  There can be no assurance that SportsLines current or potential competitors will not develop products and services comparable or superior to those developed by SportsLine or adapt more quickly than the Company to new
technologies, evolving industry trends or changing Internet user preferences.  Increased competition could result in price reductions, reduced margins or loss of market share, any of which would materially and adversely affect the
Companys business, results of operations and financial condition.  There can be no assurance that the Company will be able to compete successfully against current and future

10



---

##### Table of Contents

competitors, or that competitive pressures faced by the Company would not have a material adverse effect on its business, results of operations and financial
condition.

Government Regulation and Legal Uncertainties

General.

Except as discussed below, SportsLines Internet operations are not currently subject to direct regulation by any government
agency, other than regulations applicable to businesses generally. The application of existing laws and regulations to SportsLine with respect to issues such as the protection of databases, user privacy, defamation, pricing, advertising, gambling,
taxation, sweepstakes and contests, promotions, content regulation, quality of products and services and intellectual property ownership and infringement can be unclear. In addition, SportsLine may also be subject to new laws and regulations
directly applicable to its activities.  Any existing or new legislation applicable to SportsLine could expose it to substantial liability, including significant expenses necessary to comply with such laws and regulations, and dampen the growth
in use of the Web.

SportsLines contests and sweepstakes may be subject to state and Federal laws
governing lotteries and gambling.  The Company seeks to design its contests and sweepstakes to either not be subject to or to fall within exemptions from such laws and restricts participation to individuals over 18 years of age who reside in
jurisdictions within the United States and Canada in which the contests and sweepstakes are lawful.  There can be no assurance that SportsLines contests and sweepstakes will be exempt from such laws or that the applicability of such laws
to the Company would not have a material adverse effect on the Companys business, results of operations and financial condition.

Certain Federal laws could have an impact on SportsLines business. The Digital Millennium Copyright Act is intended to reduce the
liability of online service providers for listing or linking to third-party Web sites that include materials that infringe copyrights or other rights of others. The Childrens Online Protection Act and the Childrens Online Privacy
Protection Act are intended to restrict the distribution of certain materials deemed harmful to children and impose additional restrictions on the ability of online services to collect user information from minors. In addition, the Protection of
Children From Sexual Predators Act of 1998 requires online service providers to report evidence of violations of Federal child pornography laws under certain circumstances. Such legislation may impose significant additional costs on the
Companys business or subject the Company to additional liabilities.

SportsLine posts its privacy
policy and practices concerning the use and disclosure of user data on its Web sites.  Any failure by the Company to comply with its posted privacy policy, requirements of the Federal Trade Commission (the FTC) regarding user
privacy, or other privacy-related laws and regulations could result in proceedings by the FTC or others which could potentially have an adverse effect on SportsLines business, results of operations and financial condition. In this regard, the
United States Congress and state legislative bodies periodically consider legislation regarding privacy issues that could affect SportsLines business.  It is not possible to predict whether or when such legislation may be adopted, and
certain proposals, if adopted, could materially and adversely affect the Companys business through a decrease in user registrations and revenues.  This could be caused by, among other possible provisions, the required use of disclaimers
or other requirements before users can utilize SportsLines services.

Due to the global nature of
the Internet, it is possible that the governments of various states of the United States or foreign countries may attempt to regulate SportsLines transmissions or to prosecute SportsLine for violations of their laws.  The Company may
unintentionally violate these laws and these laws may be modified, or new laws enacted, in the future.  It is also possible that various states of the United States or foreign countries may seek to impose sales taxes on out-of-state businesses
that engage in commerce over the Internet.  In the event that states or foreign countries succeed in imposing sales or other taxes on Internet commerce, the growth of the use of the Internet for commerce could slow substantially.

11



---

##### Table of Contents

Nevada Regulation and Licensing

During 2000, the Companys wholly owned subsidiary, VegasInsider.com, Inc. (VegasInsider), purchased the DBC Sports
division (DBC Sports) of Data Broadcasting Corporation (DBC), including all of the outstanding stock of Las Vegas Sports Consultants (LVSC).  LVSC was and remains engaged in the business of selling and
providing certain information to casinos doing business in Nevada.  As such, it is required to be licensed as an information service provider as that term is defined by the Nevada Gaming Control Act and the regulations promulgated
thereunder (the Nevada Act) and is subject to the licensing and regulatory control of the Nevada Gaming Commission (the Nevada Commission) and the Nevada State Gaming Control Board (the Nevada Board) (The Nevada
Commission and the Nevada Board are collectively referred to as the Nevada Gaming Authorities).

The laws, regulations and supervisory procedures of the Nevada Gaming Authorities are based upon declarations of public policy which are
concerned with, among other things: (i) the prevention of unsavory or unsuitable persons from having a direct or indirect involvement with gaming at any time or in any capacity; (ii) the establishment and maintenance of responsible accounting
practices and procedures; (iii) the maintenance of effective controls over the financial practices of licensees, including the establishment of minimum procedures for internal fiscal affairs and the safeguarding of assets and revenues, providing
reliable record keeping and filing periodic reports with the Nevada Gaming Authorities; (iv) the prevention of cheating and fraudulent practices; and (v) providing a source of state and local revenues through taxation and licensing fees. Changes in
such laws, regulations and procedures could have an adverse effect on the Companys information services provider operations.  Gaming licenses require the periodic payment of fees and taxes and are not transferable.

Prior to the acquisition of LVSC by the Company, LVSC had submitted an application with the Nevada Gaming Authorities
to be licensed as an information service provider. As a result its change of ownership, LVSC filed an amended application with the Nevada Gaming Authorities in order to reflect its new ownership structure.  VegasInsider filed an
application with the Nevada Gaming Authorities to be found suitable as an intermediary holding company, and the Company filed an application with the Nevada Gaming Authorities to be registered as a publicly traded company (Registered
Corporation).  In addition, certain officers and/or directors of the Company, VegasInsider and LVSC filed applications with the Nevada Gaming Authorities to be found suitable as officers and/or directors of the respective companies. 
In November 2000, the Nevada Board activated an investigation of the respective applications and the investigation is ongoing.  However, prior to final action on the applications, LVSC is permitted under Nevada law to continue to operate its
present business without an approved license.

The Company has declared its intention to sell LVSC and
VegasInsider; upon the sale of these businesses, the Company intends to seek withdrawal of its applications to the Nevada Gaming Authorities.  LVSC and VegasInsider intend to continue their respective business operations pending such sale. If,
prior to the sale, the Nevada Gaming Authorities determines that LVSC, VegasInsider or the Company are unsuitable, LVSC may be required to cease the business of providing odds information to Nevadas licensed sports books, within a time frame
prescribed by the Nevada Gaming Commission.

Intellectual Property

SportsLines performance and ability to compete are dependent to a significant degree on its internally developed content and
technology.  The Company relies on a combination of copyright and trademark laws, trade secret protection, confidentiality and non-disclosure agreements with its employees and with third parties and contractual provisions to establish and
protect its proprietary rights.  There can be no assurance that the steps taken by SportsLine to protect its proprietary rights will be adequate, that SportsLine will be able to secure trademark registrations for all of its marks in the United
States and/or foreign countries, or that third parties will not infringe upon or misappropriate the Companys copyrights, trademarks, service marks and similar proprietary rights.  In addition, effective copyright and trademark protection
may be unenforceable or limited in certain foreign countries, and the global nature of the Internet makes it impossible to control the ultimate destination of the Companys services.  In the future, litigation may be necessary to enforce
and protect the Companys trade secrets, copyrights and other intellectual property rights.

12



---

##### Table of Contents

From time to time, third parties have asserted copyright or trademark infringement
claims against SportsLine or claims that the Companys use of certain technologies violates a patent. If it is determined that SportsLine has infringed upon a third partys proprietary rights, there can be no assurance that any necessary
licenses or rights could be obtained on terms satisfactory to the Company, if at all.  The inability to obtain any required license on satisfactory terms could have a material adverse effect on the Companys business, results of operations
and financial condition.  SportsLine may also be subject to litigation to defend against claims of infringement of the rights of others or to determine the scope and validity of the intellectual property rights of others.  If competitors
of SportsLine prepare and file applications in the United States that claim trademarks used or registered by the Company, SportsLine may oppose those applications and have to participate in proceedings before the United States Patent and Trademark
Office to determine priority of rights to the trademark, which could result in substantial costs to the Company, even if the eventual outcome is favorable to the Company.  An adverse outcome could require SportsLine to license disputed rights
from third parties or to cease using such trademarks.  Any such litigation would be costly and divert managements attention, either of which could have a material adverse effect on the Companys business, results of operations and
financial condition.  Adverse determinations in such litigation could result in the loss of certain of the Companys proprietary rights, subject the Company to significant liabilities, require the Company to seek licenses from third
parties, or prevent the Company from selling its services, any one of which could have a material adverse effect on SportsLines business, results of operations and financial condition.  In addition, inasmuch as SportsLine licenses a
substantial portion of its content from third parties, its exposure to copyright infringement actions may increase because the Company must rely upon such third parties for information as to the origin and ownership of such licensed content. 
SportsLine attempts to obtain representations as to the origins and ownership of such licensed content and generally obtains indemnification to cover any breach of any such representations; however, there can be no assurance that such
representations will be accurate or that such indemnification will provide adequate compensation for any breach of such representations.

The Company has applied to register in the United States a number of marks, several of which include the term SportsLine.
The Company has filed applications to register SportsLine marks in the United Kingdom, Canada and Mexico.  There can be no assurance that the Company will be able to secure adequate protection for these trademarks in the United
States or in foreign countries.  Many foreign countries have a first-to-file trademark registration system; and thus the Company may be prevented from registering its marks in certain countries if third parties have previously filed
applications to register or have registered the same or similar marks.  It is possible that competitors of the Company or others will adopt product or service names similar to the Companys, thereby impeding the Companys ability to
build brand identity and possibly leading to customer confusion.  The inability of the Company to protect its SportsLine mark and other marks adequately could have a material adverse effect on the Companys business, results of
operations and financial condition.

SportsLine grants users of its Web sites a license to use the
Companys service under an agreement that prohibits the unauthorized reproduction or distribution of SportsLines licensed and proprietary content.  Despite the Companys efforts to protect its proprietary rights, unauthorized
parties may attempt to copy aspects of the Companys service or to obtain and use information that SportsLine or its content providers regard as proprietary.  There can be no assurance that the steps taken by the Company to protect its
proprietary rights will be adequate or that third parties will not infringe or misappropriate SportsLines copyrights, trademarks, service marks and similar proprietary rights.

Employees

As of December 31, 2002, SportsLine had 294 full-time employees,
of whom 96 employees were in editorial and operations, 61 were in technical and product development, 100 were in sales and marketing, and 37 were in finance and administration.  The Companys future success depends in large part upon its
ability to attract and retain highly qualified employees.  There can be no assurance that the Company will be able to retain its senior management or other key employees or that it will be able to attract and retain additional qualified
personnel in the future.  The Companys employees are not represented by any collective bargaining organization, and the Company considers its relations with its employees to be good.

13



---

##### Table of Contents

Infrastructure, Operations and Technology

The Companys web sites are made available with multiple servers using both the Red Hat Linux and Solaris operating systems on
Dell, Intel and Sun equipment. The majority of the sites was built using the perl programming language and is served with the Apache web server software. Capabilities in place include bulletin boards, mail, chat, news groups, merchandising, and
interactive Java and Flash applications.

The Company maintains the equipment used to service its customer
sites with Cable and Wireless (C&W) in their Miami, Florida datacenter facility. The facility maintains multiple redundant Internet feeds on the C&W backbone and accommodates 4 to 5 times the amount of bandwidth capabilities that
the Company requires. The Miami datacenter gets power from two independent power grids and is located near Miami International Airport, which is given higher priority for service restoration in the event of a catastrophe. The datacenter is staffed
twenty-four hours a day, every day, with both operations and security personnel.  The Company also maintains a disaster recovery site with C&W datacenter in Sterling, Virginia.

The Companys offices and production/programming systems are located at its Fort Lauderdale, Florida corporate headquarters. 
The Companys headquarter operations are dependent upon its ability to protect its systems against damage from fire, hurricanes, power loss, telecommunications failure, break-ins, computer viruses and other events beyond the Companys
control.  The Company maintains access to and from the Internet through two third-party providers of DS3 connections; one provides a capacity of 45 megabits per second, the other provides 100 megabits per second capacity. These links are
connected to two routers in the Companys facility.  Redundant cables from the Companys building connect with each local Internet providers network.  The Companys Internet connections are designed to be fully
redundant, so that if a failure in the network or equipment of one service provider occurs, traffic is automatically routed through to the other provider.  All of the Companys computer equipment is powered by an uninterruptible power
supply, which is backed up by a diesel generator designed to provide power to the UPS within seconds of a power outage.  In addition, all of the Companys production systems are copied to backup tapes each night and stored at a third
party, off-site storage facility.  All of the Companys computer equipment is insured at replacement cost.  The Company also maintains a private data circuit connecting its headquarter facility to its Miami datacenter and uses
an encrypted virtual private network over the Internet as a redundant backup to that circuit.

If, despite
these and other precautions taken, the Companys internet access is disrupted, and the Companys third party providers are unable to handle higher volumes of users, or such third party providers experience damage or failure that causes
system disruptions or other significant interruptions in the Company operations, the Companys business, results of operations and financial condition could be materially adversely affected.

Executive Officers

The executive officers of the Company are as
follows:

|Name               |  | Age |  | Position                                                           
|------------------ |  | --- |  | -------------------------------------------------------------------
|                   |  |     |  |                                                                    
|Michael Levy       |  | 56  |  | Chairman of the Board, President and Chief Executive Officer       
|Mark J. Mariani    |  | 46  |  | President, Sales and Marketing                                     
|Peter Pezaris      |  | 33  |  | President of Operations and Product Development                    
|Kenneth W. Sanders |  | 46  |  | President of Finance and Administration and Chief Financial Officer

Michael Levy has served as the Chairman of the Board, President and Chief Executive Officer of the Company since its
inception in February 1994.  From 1979 through March 1993, Mr. Levy served as President, Chief Executive Officer and as a director of Lexicon Corporation, a high technology company specializing in data communications and signal processing
technology.  From January 1988 to June 1993, Mr. Levy also served as Chairman of the Board and Chief Executive Officer of Sports-Tech International, Inc., a company engaged in the

14



---

##### Table of Contents

development, acquisition, integration and sale of computer software, equipment and computer-aided video systems used by professional, collegiate and high school sports
programs.  Between June 1993 and February 1994, Mr. Levy was a private investor.

Mark J.
Mariani has served as President, Sales and Marketing, since June 1999. He joined the Company in April 1996 as Executive Vice President, Sales. Mr. Mariani is responsible for Sales, Marketing, Radio Operations and Vegas Insider. From August
1991 to March 1996, Mr. Mariani served as Executive Vice President of Sports Sales for Turner Broadcasting Sales, Inc.  From June 1990 to August 1991, Mr. Mariani served as Senior Vice President and National Sales Manager for CNN in New York,
and from May 1986 to June 1990, Mr. Mariani served as Vice President for CNN Sales Midwest. Prior to joining Turner Broadcasting, Mr. Mariani served as an Account Executive for WBBM, an owned and operated CBS television station in Chicago,
Illinois.

Peter Pezarishas served as SportsLine.coms President of
Operations and Product Development since April 2002, responsible for technology and computer operations as well as programming, production and fantasy products.  From June 2001 to April 2002, Mr. Pezaris was President, Product Development,
responsible for programming, production and fantasy products and prior to June 2001 was Senior Vice President, Product Development, responsible for SportsLine.coms Commissioner.com subsidiary, which produces Fantasy products for CBS
SportsLine.com as well as official Fantasy games for NFL.com and AOL.com. Mr. Pezaris joined SportsLine in December 1999 when SportsLine acquired Daedalus World Wide Corporation (DWWC), the producer of Commissioner.com fantasy products
that Mr. Pezaris co-founded in 1995. Prior to DWWC, Mr. Pezaris was a systems and software developer for the investment banking firms of Bankers Trust and Salomon Brothers.

Kenneth W. Sanders has served as President of Finance and Administration and Chief Financial Officer since January 2001.
Mr. Sanders became the Vice President and Chief Financial Officer of the Company in September 1997 and was appointed Senior Vice President in October 1998. From January 1996 to August 1997, Mr. Sanders served as Senior Vice President, Chief
Financial Officer of Paging Network, Inc., the worlds largest paging company. From May 1993 to December 1995, Mr. Sanders served as Executive Vice President, Chief Financial Officer and a director of CellStar Corporation, an integrated
wholesaler and retailer of cellular phones and related products. Between July 1979 and April 1993, Mr. Sanders was with KPMG Peat Marwick, most recently as an Audit Partner from July 1990 to April 1993.

Item 2.    Properties.

SportsLines corporate headquarters are located in Fort Lauderdale, Florida.  The Company currently leases approximately
80,000 square feet under a lease which expires in March 2010. See Note 11 of Notes to Consolidated Financial Statements.  The Company has options to extend the lease for two additional five-year terms.  The space at the corporate
headquarters facility is in excess of the Companys current needs and the Company is seeking to sublease approximately 30,000 square feet of the facility.  SportsLine leases sales offices in Chicago, New York, Atlanta, San Francisco, Los
Angeles and Detroit and office space in Las Vegas.  The Company also leases two offices in Austin, Texas and New York, New York that are no longer being used by the Company and are currently being subleased; however, there is no guarantee that
these subleases will continue in the future.

Item 3.    Legal Proceedings.

In November 2001, Sandbox.com, Inc. (Sandbox) filed a lawsuit in the Seventeenth Judicial Circuit in and for Broward County,
Florida, alleging that the Company breached an agreement and plan of merger to acquire Sandbox (the Merger Agreement), misappropriated trade secrets, breached fiduciary duties, and was unjustly enriched as a consequence of alleged
transfers of assets and proprietary information.  The Company in its Answer and Affirmative Defenses and Claim of Right to Setoff asserts that it was within its contractual rights to terminate the Merger Agreement and otherwise denies the
substantive claims set forth in Sandboxs complaint, claims a $600,000 set off for Sandboxs breach of the Merger Agreement, and has filed a counterclaim against Sandbox and a third party complaint against another party for fraud
in the inducement relating to the Merger Agreement and a related Consulting Agreement.  The case is in the pre-trial discovery phase, and no trial date or pretrial order has yet been

15



---

##### Table of Contents

set by the court.  On September 6, 2002, Sandbox commenced a Chapter 11 bankruptcy proceeding in the United States Bankruptcy Court, Eastern District of Virginia, which
was subsequently converted into a Chapter 7 bankruptcy proceeding.  The Company believes that it is unlikely that the bankruptcy trustee will continue to pursue the case; however, the Company believes that the claim by Sandbox is without merit
and intends to vigorously defend itself in this action in the event the case is pursued by the trustee.   The Company also intends to continue to pursue its claims against the third party defendant.

On January 28, 2003, SportsTicker Enterprises, L.P., a vendor of electronic sports data, filed a lawsuit against SportsLine in New York
State Supreme Court, alleging that SportsLine improperly terminated its subscription agreement with SportsTicker.   SportsTickers complaint seeks approximately $2.15 million in damages.  On March 24, 2003, SportsLine filed a motion
to dismiss all claims on the ground that SportsLines termination was expressly authorized by the contract as a result of interruptions in SportsTickers service.  The motion has not yet been decided.  The Company believes the
claim by SportsTicker is without merit and intends to vigorously defend itself in this action.

From time
to time, SportsLine may be involved in litigation relating to claims arising out of its operations in the normal course of business.  The Company is not currently a party to any other legal proceedings, the adverse outcome of which,
individually or in the aggregate, is expected to have a material adverse effect on SportsLines financial position or results of operations.

Item 4.    Submission of Matters to a Vote of Security Holders.

No matter was submitted to a vote of security holders during the fiscal quarter ended December 31, 2002.

16



---

##### Table of Contents

PART II

Item 5.    Market for the Registrants Common Equity and Related Stockholder Matters.

Market Prices
for the Companys Common Stock and Related Stockholder Matters

The Companys Common Stock
has been traded on the Nasdaq National Market under the symbol SPLN since November 13, 1997.  The following table sets forth for the periods indicated the range of high and low closing prices per share of Common Stock, as reported
by the Nasdaq National Market:

|     |                | High |   | Low  | 
|---- | -------------- | ---- | - | ---- | 
|     |                |      |   |      | 
|2002 |                |      |   |      | 
|     | First Quarter  |      | $ | 3.70 | 
|     | Second Quarter |      |   | 3.50 | 
|     | Third Quarter  |      |   | 1.57 | 
|     | Fourth Quarter |      |   | 1.41 | 
|2001 |                |      |   |      | 
|     | First Quarter  |      | $ | 9.63 | 
|     | Second Quarter |      |   | 4.50 | 
|     | Third Quarter  |      |   | 2.40 | 
|     | Fourth Quarter |      |   | 3.82 | 

SportsLine has never paid any cash dividends on its Common Stock and does not anticipate paying any cash dividends in the foreseeable
future.  SportsLine currently intends to retain future earnings, if any, to fund the development and growth of its business.

As of March 11, 2003, the Company had approximately 570 stockholders of record.

Sales of Unregistered Securities During the Year Ended December 31, 2002

| | (1) | In January 2002, pursuant to the terms of the CBS Agreement, the Company issued to CBS 6,882,312 shares of its common stock with a value of $20,000,000, in consideration of the
rights granted to the Company under the agreement.                                                                                                    
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                        
| | (2) | In July 2002, pursuant to the terms of the AOL agreement, the Company issued to AOL 1,945,525 shares of common stock, with a value equal to $2,000,000, in consideration of the
rights granted to the Company under the agreement.                                                                                                     
| |     |                                                                                                                                                                                                                                                                                                                                        
| | (3) | In September 2002, pursuant to the Companys agreement with JAE Endorsements, Inc. relating to the services of John Elway, the Company issued to JAE Endorsements and its
assignees an aggregate of 200,000 shares of common stock with a value of $246,000, in consideration of the rights granted to the Company under the agreement.

No underwriter was involved in any of the above sales of securities.  All of the above securities were issued in reliance upon the
exemption set forth in Section 4(2) of the Securities Act of 1933, as amended (the Securities Act), on the basis that they were issued under circumstances not involving a public offering.

17



---

##### Table of Contents

Item 6.    Selected Financial Data.

The following data should be read in conjunction with the Companys Consolidated Financial Statements and Notes thereto included in
Item 8 of this Form 10-K.  The selected consolidated balance sheet data set forth below as of December 31, 2002 and 2001, and the selected consolidated statement of operations data for the three years ended December 31, 2002 have been derived
from the Companys audited consolidated financial statements included elsewhere herein.1



|                              |                                                                                      | Year Ended December 31,                         |       
|----------------------------- | ------------------------------------------------------------------------------------ | ----------------------------------------------- | ------
|                              |                                                                                      |                                                 |       
|                              |                                                                                      | Total 2002                                      |       
|                              |                                                                                      |                                                 |       
|                              |                                                                                      | (In thousands, except share and per share data) |       
|Statement of Operations Data: |                                                                                      |                                                 |       
|Revenue                       |                                                                                      | $                                               | 62,065
|Cost of revenue               |                                                                                      |                                                 | 23,962
|                              |                                                                                      |                                                 |       
|Gross profit (loss)           |                                                                                      |                                                 | 38,103
|Operating expenses:           |                                                                                      |                                                 |       
|                              | Product development                                                                  |                                                 |       
|                              | Sales and marketing:                                                                 |                                                 |       
|                              | Amortization of equity issued to Viacom for promotion                                |                                                 |       
|                              | Other                                                                                |                                                 |       
|                              | General and administrative                                                           |                                                 |       
|                              | Depreciation and  amortization                                                       |                                                 |       
|                              | Restructuring charge                                                                 |                                                 |       
|                              | Write-down of goodwill                                                               |                                                 |       
|                              | Other non-recurring charge for settlement of litigation                              |                                                 |       
|                              |                                                                                      |                                                 |       
|                              | Total operating expenses                                                             |                                                 |       
|                              |                                                                                      |                                                 |       
|                              | Loss from operations                                                                 |                                                 |       
|                              | Interest expense                                                                     |                                                 |       
|                              | Interest and other income, net                                                       |                                                 |       
|                              | Loss on equity investments                                                           |                                                 |       
|                              | Gain on termination of advertising agreements                                        |                                                 |       
|                              |                                                                                      |                                                 |       
|                              | Gain on sale of e-commerce subsidiaries                                              |                                                 |       
|                              | Gain on extinguishment of debt                                                       |                                                 |       
|                              | Effect of deconsolidation of Sports.com                                              |                                                 |       
|                              |                                                                                      |                                                 |       
|                              | Net loss before tax benefit                                                          |                                                 |       
|                              | Tax benefit                                                                          |                                                 |       
|                              |                                                                                      |                                                 |       
|                              | Net loss                                                                             |                                                 | $     
|                              |                                                                                      |                                                 |       
|                              | Net loss per share  basic and diluted                                               |                                                 | $     
|                              |                                                                                      |                                                 |       
|                              | Weighted average common and common equivalent shares outstanding  basic and
diluted |                                                 |       
|                              |                                                                                      |                                                 |       
|                              |                                                                                      |                                                 |       



|                                                                                     | Year Ended December 31,                                 |                                                
|------------------------------------------------------------------------------------ | ------------------------------------------------------- | -----------------------------------------------
|                                                                                     |                                                         |                                                
|                                                                                     |                                                         | (unaudited) U.S. 1999                          
|                                                                                     |                                                         |                                                
|                                                                                     |                                                         | (In thousands, except share and per share data)
|Statement of Operations Data:                                                        |                                                         |                                                
|Revenue                                                                              | $                                                       | 58,284                                         
|Cost of revenue                                                                      |                                                         | 31,536                                         
|                                                                                     |                                                         |                                                
|Gross profit (loss)                                                                  |                                                         | 26,748                                         
|Operating expenses:                                                                  |                                                         |                                                
|                                                                                     | Product development                                     |                                                
|                                                                                     | Sales and marketing:                                    |                                                
|                                                                                     | Amortization of equity issued to Viacom for promotion   |                                                
|                                                                                     | Other                                                   |                                                
|                                                                                     | General and administrative                              |                                                
|                                                                                     | Depreciation and  amortization                          |                                                
|                                                                                     | Restructuring charge                                    |                                                
|                                                                                     | Write-down of goodwill                                  |                                                
|                                                                                     | Other non-recurring charge for settlement of litigation |                                                
|                                                                                     |                                                         |                                                
|                                                                                     | Total operating expenses                                |                                                
|                                                                                     |                                                         |                                                
|Loss from operations                                                                 |                                                         | (51,417                                        
|Interest expense                                                                     |                                                         | (4,392                                         
|Interest and other income, net                                                       |                                                         | 8,783                                          
|Loss on equity investments                                                           |                                                         |                                               
|Gain on termination of advertising agreements                                        |                                                         |                                               
|Gain on sale of e-commerce subsidiaries                                              |                                                         |                                               
|Gain on extinguishment of debt                                                       |                                                         | 36,027                                         
|Effect of deconsolidation of Sports.com                                              |                                                         |                                               
|                                                                                     |                                                         |                                                
|Net loss before tax benefit                                                          |                                                         | (10,999                                        
|Tax benefit                                                                          |                                                         |                                               
|                                                                                     |                                                         |                                                
|Net loss                                                                             | $                                                       | (10,999                                        
|                                                                                     |                                                         |                                                
|Net loss per share basic and diluted                                                |                                                         |                                                
|                                                                                     |                                                         |                                                
|Weighted average common and common equivalent shares outstanding  basic and diluted |                                                         |                                                
|                                                                                     |                                                         |                                                
|                                                                                     |                                                         |                                                



|                                                 |  | December 31,   |       
|------------------------------------------------ |  | -------------- | ------
|                                                 |  |                |       
|                                                 |  | 2002           |       
|                                                 |  |                |       
|                                                 |  | (in thousands) |       
|Balance Sheet Data:                              |  |                |       
|Cash and marketable securities                   |  | $              | 37,625
|Working capital                                  |  |                | 18,405
|Total assets                                     |  |                | 91,988
|Long-term obligations, net of current maturities |  |                | 23,561
|Total shareholders equity                       |  |                | 54,035

---

1 Results of Sports.com
are consolidated from August 1999 through July 2001 only.  See Item 7. Managements Discussion and Analysis of Financial Condition and Results of Operations  Overview.

18



---

##### Table of Contents

Item 7.    Managements Discussion and Analysis of Financial Condition and Results of Operations

The following Managements Discussion and Analysis of Financial Condition and Results of Operations contains forward-looking
statements, which involve risks and uncertainties.  The Companys actual results could differ materially from those anticipated in these forward-looking statements as a result of certain risk factors, including those set forth under
Risk Factors that May Affect Future Results, below and elsewhere in this Report.  The following discussion also should be read in conjunction with the information set forth in Item 6. Selected Financial Data and the
Companys Consolidated Financial Statements and Notes thereto included in Item 8. Financial Statements and Supplementary Data of this Annual Report on Form 10-K.

Overview

Commencing in 2002, the Company is categorizing its revenue streams
into two types: advertising and marketing services revenue and subscription and premium products revenue. Prior to 2002, the Company also derived revenue from content licensing and international revenue.  Advertising and marketing services
revenue, subscription and premium products revenue, content licensing revenue and international revenue constituted approximately 77%, 23%, 0%and 0%, respectively, of the Companys total revenue in 2002; 80%, 8%, 5%and 7%, respectively, of the
Companys total revenue in 2001; and 76%, 6%, 9% and 9%, respectively, of the Companys total revenue in 2000.

Advertising and marketing services revenue is derived principally from short-term advertising contracts on a per impression basis or for
a fixed fee based on a minimum number of impressions.  Advertising revenue also includes sponsorship opportunities that enable advertisers to associate their corporate messages with the Companys coverage of major sports and marquee
events, games and contests for a fee.   Advertising and marketing services revenue is also derived from the sale of advertising on Web sites that the Company operates such as NFL.com and pgatour.com.  Advertising and marketing
services revenue is recognized in the period in which the advertisement is displayed or services rendered, provided that no significant obligations remain and collection of the resulting receivable is probable.  Company obligations typically
include guarantees of a minimum number of impressions, or times that advertisements appear in page views downloaded by users.  Advertising and marketing services revenue includes the Companys revenue from its direct marketing
services and from promotion of e-commerce Web sites such as MVP.com and the NFL.com shop.

Although most of
the content on the Companys Web sites is free, users of the Companys Web sites can purchase memberships and premium services for a fee.  Subscription and premium products revenue relating to annual memberships and seasonal sports
contests is recognized ratably over the life of the membership agreement or contest period.  Accordingly, amounts received for which services have not yet been provided are recorded as deferred revenue on the Companys balance
sheets.

Content licensing revenue was recognized over the period of the license agreement as the
Company delivered its content.  The Company did not have any content licensing revenue in 2002 and does not expect to have any such revenue in the future, unless the Company enters into new content licensing agreements. International revenue
was related to the Companys prior subsidiary Sports.com.

In March 1997, the Company entered into a
strategic alliance with CBS pursuant to which the Companys flagship Web site was renamed cbs.sportsline.com.  The CBS agreement was amended in February 1999 (as amended to date, the CBS Agreement) to extend the
term for an additional five years, effective as of January 1, 1999, through 2006.  Commencing with calendar year 1999, CBS is obligated to provide advertising and promotion of the cbs.sportsline.com Web site pursuant to a fixed promotion
schedule. In consideration of additional promotional and advertising opportunities, at the time of the execution of the amendment in 1999, the Company accelerated the issuance of the remaining shares that were formerly to be issued in 2000 and 2001
(567,579 and 485,358 shares, respectively), issued additional warrants to purchase 1,200,000 shares of common stock at per share exercise prices ranging from $23 in 1999 to $45 in 2001 and became obligated to issue additional shares of common stock
valued at $100 million between 2002 and 2006.  The 1999 amendment to the CBS Agreement provides that SportsLines obligation to issue additional shares of common stock valued at $100 million between 2002 and 2006 is to be
satisfied

19



---

##### Table of Contents

by the issuance of shares having a fair market value of $20 million based on the average of closing prices of the common stock on the Nasdaq National Market for the five-day
period ending on the day prior to each of the following five issue dates, as applicable:  January 1, 2002; April 1, 2003; July 1, 2004; October 1, 2005; and January 1, 2007. In January 2002, the Company satisfied the first of the foregoing five
issuances by issuing approximately 6.9 million shares of common stock to CBS valued at $20 million.  In March 2003, the CBS Agreement was amended to modify the annual schedule of stock issuances to CBS.   See Recent
Developments.

In July 2001, SportsLine entered into a multi-year agreement (the NFL
Agreement) with CBS, AOL and the NFL.  Pursuant to the terms of the NFL Agreement, SportsLine is responsible for the production and hosting of the NFLs Internet sites, including NFL.com, superbowl.com, nfleurope.com and
playfootball.com.  SportsLine is entitled to recoup the costs of such production and hosting pursuant to an agreed-upon budget, from the first dollars of revenue generated from such sites, after the payment of certain sales commissions,
including but not limited to, advertising and sponsorship sales, e-commerce revenues and direct marketing and, to a limited extent, from the exploitation of certain emerging media rights (collectively, the Gross Revenues). 
SportsLine is responsible for a portion of the rights fee payments required to be made to the NFL under the NFL Agreement, with SportsLines share of the required cash payments aggregating $24,050,000 over the five-year term of the NFL
Agreement as follows:  $4,238,000 has been paid as of December 31, 2002, $812,000 is owed for the second year; $6,000,000 for each of the third and fourth years; and $7,000,000 for the fifth year.  In addition, SportsLine issued to the NFL
350,000 shares of SportsLine common stock upon effectiveness of the NFL Agreement; and is obligated to pay an additional $1,333,333 in cash or stock, at SportsLines option, in May 2003 and an additional $2,666,667 in cash or stock, at
SportsLines option, in May 2004.  After the payment of certain sales commissions and SportsLines recoupment of its production and hosting expenses, SportsLine is entitled to a graduated share of Gross Revenues in an amount
aggregating approximately 50% of the first $140,000,000 of Gross Revenues generated during the term of the NFL Agreement.  In addition, SportsLine may be entitled to receive 20% of certain additional Gross Revenues in excess of such
amount.  The NFL has the unilateral right to terminate the NFL Agreement after the second or third year of the contract.

In July 2001, SportsLine extended its existing agreement with AOL (the AOL Extension).  Pursuant to the AOL Extension,
SportsLine paid AOL $1,000,000 cash in July 2001 and issued to AOL approximately 1.95 million shares of common stock valued at $2,000,000 in July 2002, and the Company is obligated to pay an additional $1,000,000 in cash and/or stock, at
SportsLines option, in July 2003.

In May 1999, SportsLine established Sports.com as a European-based,
majority owned subsidiary.  In 2000, the Company consolidated between 71% and 100% of the losses of Sports.com, which had historically been offset by the allocation of a portion of such losses to third party holders of Sports.com common
stock.  On July 17, 2001, Sports.com raised approximately $13,000,000 in equity funding from its existing investors.  After giving effect to the funding, the Companys fully diluted ownership stake in Sports.com, including all
outstanding warrants and management options, was approximately 30%. As a result of the Companys reduced ownership interest in Sports.com and a reduction in the Companys representation on Sports.coms board of directors to less than
a majority, as of July 17, 2001 the Company no longer consolidated the results of Sports.com and accounted for its investment in Sports.com under the equity method of accounting.  In accordance with United States generally accepted accounting
principles, the Company recorded in 2001 the effect of the deconsolidation of the subsidiary in the amount of $41,739,000.  The Companys comprehensive loss in 2001 decreased by approximately $5,200,000 due to the deconsolidation of
Sports.com.  After July 17, 2001, the Company no longer recorded any losses generated by Sports.com, as its investment had been reduced to zero and the Company had no future obligation to provide funding to Sports.com. Sports.coms assets
and liabilities are included in the Companys Consolidated Balance Sheet as of December 31, 2000. Sports.coms revenue, expenses and minority interest are included in the Companys Consolidated Statements of Operations for the year
ended December 31, 2000 and its revenue, expenses and minority interest through July 17, 2001 are included in the Consolidated Statement of Operations of the Company for the year ended December 31, 2001.  On May 31, 2002, Sports.com was placed
into administration, a procedure in the U.K. pursuant to which a court-appointed administrator assumes day-to-day control of a company in order to determine whether a business should be reorganized, sold or liquidated.  In July 2002, the
Company terminated its inter-company agreement with Sports.com, pursuant to which, among other things, the Company licensed the sports.com domain to Sports.com.  Separately, the Company sold the rights to the sports.com domain to an unrelated
third party.  The effect on the Companys financial condition and results of operations was not material.

20



---

##### Table of Contents

The Company acquired DWWC in December 1999.  The transaction was accounted for
using the purchase method of accounting.  The purchase resulted in goodwill of $31,880,000, which was being amortized over an estimated life of seven years.  In the fourth quarter of 2000, a $12,000,000 liability (included in accounts
payable at December 31, 2000) was recorded pursuant to the purchase agreement, which provided for additional consideration contingent upon the acquired company meeting certain performance thresholds.  During the first quarter of 2001, 828,376
shares of common stock were issued in satisfaction of $6,000,000 of the liability and during the fourth quarter of 2001, 2,195,968 shares of common stock were issued in satisfaction of the remaining $6,000,000 liability.  In addition, the
Company recognized a goodwill write-down during the year ended December 31, 2001 of $17,000,000 related to the reduced estimate of the value of its investment in DWWC.  The Companys assessment of its goodwill investment was based on
historical operations, undiscounted future cash flows and the market values of similar entities.  See Note 4 of Notes to Consolidated Financial Statements.  The Company performed the annual impairment test required under SFAS No. 142 to
test impairment as of October 1, 2002.  As a result, the Company found no impairment of its goodwill.  At December 31, 2002, the Company had goodwill of $16,194,000 recorded for DWWC.

In April 2000, the Company, through its wholly owned subsidiary VegasInsider.com, Inc., purchased the assets of the DBC Sports division
(DBC Sports) of Data Broadcasting Corporation (DBC), including LVSC, in exchange for 277,152 shares of the Companys common stock (the Consideration Shares).  Pursuant to the terms of the purchase
agreement, the Company guaranteed that the Consideration Shares would have a value equal to or greater than $12.5 million on March 31, 2001 (the Guaranteed Proceeds).  On April 6, 2001, due to the decline in the trading price of the
Companys common stock, the Company fulfilled its obligation to DBC by purchasing the Consideration Shares for $12.5 million. The Consideration Shares were cancelled and retired in April 2001. The Company recorded a goodwill write-down of
$4,600,000 in 2001 to reflect a reduction in the estimated value of its investment in DBC Sports.  The assessmentof goodwill was based on historical operating results, undiscounted future cash flows and the market values of similar
entities.  The Company performed the annual impairment test required under SFAS No. 142 to test impairment as of October 1, 2002.  As a result, the Company recorded a goodwill write-down of $2,650,000 to adjust the value of its investment
in DBC Sports to its estimated fair value.  At December 31, 2002, the Company had goodwill of $2,017,000 recorded for DBC Sports.  See Note 4 of Notes to Consolidated Financial Statements.

Recent Developments

NCAASports.com Agreement

In February 2003, the NCAA, CBS and SportsLine announced an agreement whereby the Company sublicensed the rights from CBS for the
official NCAA Championship Web site, in their entirety, through 2006. These rights include site production, hosting and management of the sale of advertising for the NCAASports.com Web site, and the exclusive rights to provide Internet broadcasts of
certain NCAA championships, including the Division 1 Mens Basketball Championship. The Company and CBS will share in revenues from the operations of the new site, with the Companys start-up production costs being recouped in the initial
year of operation.

Disposal of VegasInsider.com Website and LVSC

As part of the NCAASports.com agreement, the Company agreed that it would dispose of its gaming information operations, consisting of
the VegasInsider.com Web site and LVSC.  Beginning in its quarterly report on Form 10-Q for the quarter ending March 31, 2003, the Company will report the results from these operations as results from discontinued operations.

CBS Amendment

On March 5, 2003,
SportsLine and CBS entered into an amendment to the CBS agreement to provide for a change in the annual payment schedule pursuant to which CBS is entitled to receive SportsLine.com common stock in exchange for promotion of the CBS SportsLine.com Web
site.

21



---

##### Table of Contents

April 2003 Payment

On April 1, 2003, SportsLine is
obligated to issue to CBS, the lesser of (1) a number of shares of common stock having a fair market value of $20,000,000 on April 1, 2003; or (2) a number of shares of common stock that will result in CBS and its affiliates aggregate
beneficial ownership interest in SportsLines outstanding common stock not exceeding 39.9% (in which case the shares actually issued on April 1, 2003 will be valued at the current fair market value of such shares and the remainder of
SportsLines $20,000,000 obligation will be deferred until July 2004).

July 2004 Payment

On July 1, 2004, SportsLine is obligated to issue to CBS the lesser of (1) a number of shares of common stock having a fair market value on July 1, 2004 equal to (x) $20,000,000 plus (y) the
amount of the April 2003 payment which was deferred; or (2) a number of shares of common stock that will result in CBS and its affiliates aggregate beneficial ownership interest in SportsLines outstanding common stock not exceeding
49.9%.  If the number of shares of common stock that would result in CBS and its affiliates aggregate beneficial ownership interest in SportsLines outstanding common stock not exceeding 49.9% has a fair market value on July 1, 2004
less than the amount of SportsLines total obligation on July 1, 2004 (i.e., $20,000,000 plus the deferred portion of the April 2003 payment), then SportsLine must satisfy up to $5,000,000 of such obligation in cash.  SportsLine has the
option to satisfy any additional remaining obligation on July 1, 2004 in cash and/or stock at its option.  If SportsLine elects to satisfy any portion of that remaining obligation, if any, in stock and the issuance of such stock would cause the
ownership interest of CBS and its affiliates to exceed 49.9% on July 1, 2004, then CBS may elect to defer that portion of the issuance until October 1, 2005.

October 2005 and January 2007 Payments

On October 1, 2005, SportsLine will remain obligated to issue to
CBS common stock with a fair market value equal to (x) $20,000,000 plus (y) the portion of the payment due in July 2004, if any, that CBS may have elected to defer.  SportsLine remains obligated to issue common stock with a fair market value of
$20,000,000 to CBS on January 1, 2007.

Critical Accounting Policies and Estimates

Managements Discussion and Analysis of Financial Condition and Results of Operations discusses the Companys consolidated
financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States.  The preparation of these financial statements requires management to make estimates and assumptions that affect
the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amount of revenue and expenses during the reporting period.  On an on-going basis,
management evaluates its estimates and judgments, including those related to bad debts, intangible assets, restructuring costs, contingencies and litigation.  Management bases its estimates and judgments on historical experience, and on various
other factors that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources.  Actual
results may differ from these estimates under different assumptions or conditions.

Management believes the
following critical accounting policies, among others, affect the more significant judgments and estimates used in the preparation of its consolidated financial statements:

| |  | The Company maintains allowances for doubtful accounts for estimated losses resulting from the inability of its customers to make required payments.  If the financial
condition of the Companys customers were to deteriorate, resulting in an impairment of their ability to make payments, additional allowances may be required.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

22



---

##### Table of Contents

| |  | The Company reviews its long-lived assets for possible impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be fully
recoverable.  If the Companys analysis indicates a possible impairment exists based on undiscounted future cash flows, it is required to then measure impairment based on the estimated fair value of the assets determined either by third
party appraisal or projected discounted future cash flows.                                                                                                                                                                                                                                                                                                                                                                                                                   
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| |  | As described below under Recent Accounting Pronouncements, effective January 1, 2002, the Company is required at least annually to test for impairment of goodwill. 
Management believes its estimates and judgments have been reasonable in determining whether the Companys goodwill has been impaired.  If, however, there were a material change in the conditions or circumstances influencing fair value, the
Company could be required to recognize an impairment charge.                                                                                                                                                                                                                                                                                                                                                                                                                        
| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| |  | SFAS No. 123, Accounting for Stock-Based Compensation allows either adoption of a fair value based method of accounting for employee stock options and similar equity
instruments or continuation of the measurement of compensation cost relating to such plans using the intrinsic value based method of accounting prescribed by Accounting Principles Board (APB) Opinion No. 25, Accounting for Stock
Issued to Employees.The Company has elected to use the intrinsic value based method.  The Company grants its employees stock options with an exercise price equal to market price; therefore, no compensation expense is
recorded.                                                                                                                                                                                                                                                          
| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| |  | Advertising and marketing services revenue encompass advertising and sponsorship sales as well as the Companys revenue from its direct marketing services and promotion of
e-commerce Web sites such as MVP.com and the NFL.com shop. Revenue is primarily derived from the sale of advertising on the Companys Web sites as well as the sale of advertising on Web sites operated by the Company.  Advertising includes,
among other forms, banner advertisements and sponsorships.  Advertising and marketing services revenue is recognized in the period the advertisement is displayed or services rendered, provided that no significant Company obligations remain and
collection of the resulting receivable is probable.  Company obligations typically include guarantees of a minimum number of impressions, or times that an advertisement is viewed by users of the Companys Web sites.

Results of Operations

Revenue

Total revenue for the year ended December 31, 2002 was $62,065,000 compared to $64,530,000 for the year ended December 31, 2001 and
$95,887,000 for the year ended December 31, 2000.  Advertising and marketing services revenue decreased to $47,816,000 in 2002 compared to $53,583,000 in 2001 and $77,666,000 in 2000. Advertising and marketing services revenue for 2002, 2001
and 2000 accounted for approximately 77%, 83% and 81%, respectively, of total revenue.  Advertising and marketing services decreased in 2002 from 2001 primarily due to managements decision to limit barter revenue, which caused barter
revenue to decrease in 2002 to 11% of advertising and marketing services revenue from 17% in 2001.  Excluding barter revenue from both years, advertising and marketing services revenue increased slightly, mainly due to increased revenue derived
from the NFL as a result of the agreement being in effect for a full year in 2002.  During 2002, the Company was able to take advantage of preseason sales opportunities, which the Company did not have the opportunity to do in 2001 since the
agreement was entered into in July 2001.  Advertising and marketing services revenue decreased in 2001 from 2000 due to lower advertising revenue relating to the termination of the Companys agreements with MVP.com, Inc. (MVP)
and Internet Sports Network, Inc. (ISN), which accounted for $27,655,000 of advertising revenue during 2000 in the aggregate, and the result of a general slowdown in the domestic advertising market.  In addition, following the
events of September 11, 2001, advertising revenue was lower than expected because of cancellations and postponement of certain sporting events such as the second week of college and pro football games and the Ryder Cup.

Subscription and premium products revenue increased to $14,249,000 in 2002 compared to $4,252,000 in 2001 and $6,284,000 in
2000.   Subscription and premium products revenue increased in 2002 from 2001 because of the

23



---

##### Table of Contents

successful conversion from primarily free fantasy sports products to fee-based fantasy products.  More than 80,000 paid fantasy leagues representing about one million
teams were formed in the Companys fee-based baseball, football, basketball and hockey fantasy games in 2002, allowing the Company to generate approximately $10,900,000 of fantasy revenue in 2002 compared to $700,000 in 2001.  The increase
in fantasy revenue from 2002 to 2001 was offset by decreases in other products such as services related to statistical data and sales of the membership rewards program.  From July 2000 to July 2001, the Company offered its fantasy products and
services for free instead of for a subscription fee. As a result, subscription and premium products revenue decreased from 2000 to 2001 primarily due to the free offering of fantasy during the 2001 baseball season offset by fee-based football
fantasy offerings during the 2001 season. Other factors contributing to the decrease in 2001 from 2000 were the discontinuation of some products such as Sports Careers subscriptions and services related to sales of statistical data.

There was no content licensing revenue in 2002 compared to $6,695,000 in 2001 and $11,937,000 in
2000.   The decrease in content licensing revenue was due primarily to the replacement in July 2001 of the Companys previous agreement with AOL, which had included a barter content licensing provision.  Additionally, in 2000 the
Company recognized content licensing revenue pursuant to its agreement with Excite, Inc. that expired in December 2000.  Unless the Company enters into new content licensing agreements, management does not expect content licensing revenue to be
significantin future periods.

There was no international revenue in 2002 compared to $4,484,000 and
$8,429,000 in 2001 and 2000, respectively.  The Companys former subsidiary, Sports.com, was the sole source of international revenue.

As of December 31, 2002, the Company had deferred revenue of $2,052,000 relating to cash and receivables for which services had not yet
been provided.

Barter transactions, in which the Company received advertising or other services or goods
in exchange for content or advertising on its Web sites, accounted for approximately 8%, 20% and 17% of total revenue for 2002, 2001 and 2000, respectively.  Barter transactions are recorded based upon, and to the extent of, similar recent cash
transactions of the Company pursuant to Emerging Issues Task Force (EITF) Issue No. 99-17, Accounting for Advertising Barter Transactions.  While the Company may enter into barter arrangements from time to time, the Company
does not expect to recognize barter advertising revenue, along with the offsetting marketing expense, in future periods.

Equity transactions, in which the Company received equity in companies in exchange for advertising and promotion accounted for
approximately 0%, 5% and 16% of total revenue for the years ended December 31, 2002, 2001 and 2000, respectively.  The majority of the equity-related revenue in 2000 was derived from two agreements, both of which had been terminated as of
December 31, 2000. An additional agreement for equity-related revenue terminated in June 2001.  Therefore, the Company expects that, unless new agreements are entered into, equity-related revenue will be insignificant in future
periods.

Cost of Revenue

Cost of revenue consists primarily of revenue share expenses, content fees to third parties and payroll and related expenses for the
editorial and operations staff that are responsible for creating content on the Companys Web sites.  Telecommunications, Internet access and computer related expenses for the support and delivery of the Companys services are also
included in cost of revenue.

Cost of revenue was $23,962,000 in 2002 compared to $32,672,000 and
$41,001,000 in 2001 and 2000, respectively.  The decrease in cost of revenue in 2002 from 2001 is primarily due to the deconsolidation of Sports.com in July 17, 2001.  Sports.com accounted for 27% of cost of revenue in 2001.  Costs
related to revenue sharing increased in 2002 from 2001, primarily due to increased expenses related to increased fantasy football revenue.   Total revenue sharing expense was $10,211,000, $7,490,000 $13,608,000 for the years ended December
31, 2002, 2001 and 2000, respectively.  Revenue sharing expense represented 16% of total revenue in 2002, 12% of total revenue in 2001, and 14% of total revenue in the year 2000.  These increased costs were offset by reductions in
telecommunications expenses and payroll.  The decrease in cost of revenue from 2000 to 2001 was primarily due to decreased revenue

24



---

##### Table of Contents

sharing expense to CBS because of lower advertising revenue, elimination of revenue sharing expense to Major League Baseball and lower costs associated with the Companys
cost restructuring program initiated in the second quarter of 2001.  Also contributing to the decrease in 2001 was the deconsolidation of Sports.com in the third quarter of 2001.  As a percentage of revenue, cost of revenue decreased to
39% in 2002 compared to 51% in 2001 and 43% in 2000.

Operating Expenses

Product Development.  Product development expense consists primarily of employee compensation and related expenses required
to support the continuing development of proprietary sports information and entertainment applications, services, technologies, interfaces and content. These costs include the Companys effort to develop streaming media content and players,
advanced java applications, ShockWave and Flash games and contests, wireless applications and technologies, broadband content and enhanced user interfaces across all products. These costs are expensed as incurred.  In future periods, the
Company intends to reclassify product development costs as general and administrative expense.

Product development expense was $2,132,000 in 2002 compared to $1,854,000 and $1,791,000 in 2001 and 2000, respectively. The increase in
product development expense in 2002 is primarily the result of increased product development personnel and consultants related to the Companys agreement to produce NFL.com partially offset by lower costs from the Companys restructuring
program.  As a percentage of revenue, product development expense was 3%, 3% and 2% for 2002, 2001 and 2000, respectively.

Sales and Marketing  Amortization of Equity Issued to Viacom for Promotion.Amortization of equity issued to Viacom
for promotion consists of the amortization expense for the Companys agreements with two Viacom-related entities pursuant to which the Company issued equity instruments in exchange for advertising and promotion.

Pursuant to the Companys promotion and licensing agreement with CBS, the Company issued shares of common stock and warrants to
purchase shares of common stock and expensed $22,286,000 in 2002 compared to $17,288,000 in both 2001 and 2000.  Additionally, the Company expensed $1,750,000 in 2002 and $3,000,000 in both 2001 and 2000 related to shares of common stock issued
to Westwood One, Inc. in exchange for promotion and programming.  These expenses were classified as depreciation and amortization expense in prior periods; 2001 and 2000 amounts have been reclassified in the accompanying consolidated financial
statements to conform to current-year presentation as sales and marketing expense.   As a percentage of revenue, amortization of equity issued to Viacom for promotion was 39% for the year ended December 31, 2002 compared to 31% in 2001 and
21% in 2000.  The Company will not recognize amortization expense related to the Westwood One, Inc. agreement in future periods due to the expiration of the Companys agreement with Westwood One on August 1, 2002.  At that time, the
Company entered into a new agreement with Westwood One that does not require the issuance of additional equity or any other financial consideration.

Sales and Marketing  Other.  Sales and marketing  other expense consists of salaries and related expenses,
advertising, marketing, promotional, business development, public relations expenses, research expenses and rights payment expenses related to the Companys agreement with the NFL.

Sales and marketing expense  other was $24,471,000 in 2002 compared to $41,255,000 and $50,943,000 in 2001 and 2000,
respectively.  The decrease in sales and marketing  other expense from 2001 to 2002 was due to the deconsolidation of Sports.com along with decreased advertising and payroll as a result of the Companys cost restructuring programs.
Also, the Companys decision to limit barter advertising contributed to the decrease in 2002.  Barter transactions accounted for approximately 21% of sales and marketing  other expense for 2002, 31% for 2001 and 30% for 2000. 
The decrease in sales and marketing  other expense from 2000 to 2001 was primarily due to the decreased Web site and television advertising spending and the replacement of the Companys agreement with AOL at a lower cost, offset by
increases in radio and outdoor advertising expense. Additionally, payroll expenses decreased in 2001 because of the Companys cost restructuring program. Also contributing to lower sales and marketing expense  other in 2001 was the
deconsolidation of Sports.com in the third quarter of 2001.    As a percentage of revenue, sales and marketing  other expense decreased to 39% in 2002 compared to 64% in 2001 and

25



---

##### Table of Contents

53% in 2000.  Included in sales and marketing  other expense are cash payments made to CBS and certain affiliates of CBS, of $367,000, $2,227,000 and $1,408,000 in
2002, 2001 and 2000, respectively, for television, radio and outdoor advertising during those periods.

General and Administrative.  General and administrative expense consists of salary and related costs for executive, finance
and accounting, technical and customer support, human resources and administrative functions, as well as rent and occupancy expenses and professional service fees.

General and administrative expense was $20,193,000 in 2002 compared to $31,359,000 and $37,091,000 in 2001 and 2000, respectively. The
decrease in general and administrative expense from 2001 to 2002 was mainly due to the deconsolidation of Sports.com, which accounted for 20% of general and administrative expense in 2001, and decreases in payroll and consulting expenses due to the
Companys cost restructuring program.  The decrease in general and administrative expense in 2001 from 2000 was primarily attributable to the deconsolidation of Sports.com in the third quarter of 2001, the Company cost restructuring
program and to a lesser extent reduced bad debt expense related to lower advertising billings.  As a percentage of revenue, general and administrative expense decreased to 33% in 2002 compared to 49% in 2001 and 39% in 2000.

Depreciation and Amortization.  Depreciation and amortization expense consists of the depreciation of
property and equipment, amortization of costs associated with consulting agreements and amortization of licensing rights and intangible assets. Depreciation and amortization expense was $11,029,000 in 2002 compared to $24,235,000 and $21,598,000 in
2001 and 2000, respectively. The decrease in depreciation and amortization expense in 2002 compared to 2001 was due primarily to the adoption of Statement of Financial Accounting Standard (SFAS) No. 142 Goodwill and Other
Intangible Assets, effective January 1, 2002.  Goodwill is no longer subject to amortization, but instead will be reviewed for impairment and, if deemed necessary, written down and charged to results of operations.  Goodwill
amortization was $8,343,000 and $6,762,000 for the years ended December 31, 2001 and 2000, respectively.  Also depreciation and amortization expense related to fixed assets decreased due to decreased purchases in 2002 compared to 2001 combined
with certain equipment becoming fully depreciated.  The increase in depreciation and amortization in 2001 compared to 2000 was due to the amortization of the intangible assets acquired from MVP in January 2001 and the goodwill recorded in
connection with the acquisition of DBC Sports in April 2000.

Under the Companys agreement with the
PGA TOUR, which became effective in April 1999, the Company paid an up-front licensing fee of $8,500,000. The licensing fee was recorded on the balance sheet as licensing rights and was amortized to depreciation and amortization expense over each
related contract year, and has been fully amortized at December 31, 2002.  Total amortization expense under the PGA TOUR agreement was $2,267,000 for each of the years ended December 31, 2002, 2001 and 2000.  In January 2003 a cash payment
of $2,000,000 was made to the PGA TOUR, which will be recognized as sales and marketing expense  other in 2003.

Write-down of Goodwill.  For the years ended December 31, 2002 and 2001 the Company recorded charges totaling $2,650,000 and
$21,600,000, respectively, to reflect the reduction in the estimated value of its investment in DWWC and DBC Sports. The write-down of goodwill related to DBC Sports was $2,650,000 in 2002 and $4,600,000 in 2001.  The write-down of goodwill
related to DWWC was $0 in 2002 and $17,000,000 in 2001. The assessment of goodwill in 2001 was based on historical operating results, estimated undiscounted future cash flows, and the estimated market values of similar entities. As of October 1,
2002, the Company performed the annual impairment test required under SFAS No. 142 to test impairment.

Restructuring Charge.For the years ended December 31, 2002 and 2001 the Company recognized restructuring charges of
$2,499,000 and $985,000 related to severance payments and the termination of leases.   See Note 2 of Notes to Consolidated Financial Statements.

Interest Expense.  Interest expense was $929,000 in 2002 compared to $1,073,000 and $1,084,000 in 2001 and 2000,
respectively.  The decrease in interest expense in 2002 was primarily due to the repurchase of an additional $2,930,000 principal amount of the Companys Convertible Subordinated Notes due 2006 (Convertible Subordinated Notes)
in the fourth quarter of 2001.  The decrease in interest expense in 2001 was primarily due to the expiration of capital leases in the first quarter of 2001.

26



---

##### Table of Contents

Interest and Other Income, Net.  Interest and other income, net primarily
represents interest earned on cash and cash equivalents and marketable securities.  Interest and other income, net was $891,000 in 2002 compared to $3,479,000 and $12,914,000 in 2001 and 2000, respectively. The decrease in interest income in
2002 compared to 2001 and 2000 was primarily attributable to a lower invested cash balance and lower interest rates.

Loss on Equity Investments.  Several of the Companys equity investments in certain Internet companies, primarily its
investment in MVP, were written off in 2000 in the amount of $127,653,000 while the remainder of such investments in the amount of $28,000 was written off in 2001.  There was no loss on equity investments in 2002.   During the third
and fourth quarters of 2000, the Company deemed its investment in MVP to be permanently impaired and wrote off the entire value of that investment.  The Companys determination was based on the market downturn during the third and fourth
quarters of 2000 which caused similar declines in the market values of publicly-traded Internet e-commerce companies, the difficulty experienced by MVP in raising additional capital and an assessment of MVPs financial condition and prospects.
MVP ceased operations in January 2001.

Gain on Termination of Advertising Agreements.Due to
the termination of the Companys relationships with MVP and Internet Sports Network during 2000, the Company was no longer obligated to perform under either of these agreements.  In December 2000, the Company recorded a gain related to the
recognition of deferred revenue from these agreements of $78,766,000, net of an expense accrual of $2,673,000 for tax expense and potential expenses related to the MVP liquidation, such as assumption of leases and legal expenses.  In December
2001, the Company reversed the remaining accrual of $2,051,000 having deemed the MVP liquidation substantially complete.  There was no gain on termination of agreements in 2002.

Gain on Sale of E-Commerce Subsidiaries.  Effective January 1, 2000, the Company sold to MVP three of its subsidiaries,
which engaged in e-commerce activity (International Golf Outlet, Inc., Golf Club Trader, Inc. and TennisDirect.com, Inc.).  The sale resulted in a one-time gain of $7,814,000, net of taxes, in 2000.

Gain on Extinguishment of Debt. During the fourth quarter of 2001, the Company repurchased $2,930,000 of its Convertible
Subordinated Notes for approximately $500,000 and, as a result, recognized a gain of $2,404,000, net of unamortized debt issuance costs.   SFAS No. 145, Rescission of FASB Statements No. 4, 44, and 62, Amendment of FASB Statement No.
13, and Technical Corrections, eliminates the previous requirement under FASB Statement No. 4, Reporting Gains and Losses from Extinguishment of Debt,to report gains and losses from extinguishments of debt as extraordinary items in the
income statement.  The Company adopted SFAS No. 145 on July 1, 2002, and accordingly reclassified the extraordinary gain of $2,404,000 that occurred from its extinguishment of debt in 2001 to other non-operating income.

Effect of deconsolidation of Sports.com.  In accordance with United States generally accepted accounting
principles, the Company recorded in 2001 the effect of the deconsolidation of Sports.com in the amount of $41,739,000.  On July 17, 2001, Sports.com raised approximately $13,000,000 in equity funding from its existing investors.  After
giving effect to the funding, the Companys fully diluted ownership stake in Sports.com, including all outstanding warrants and management options, was approximately 30%. As a result of the Companys reduced ownership interest in
Sports.com and a reduction in the Companys representation on Sports.coms board of directors to less than a majority, as of July 17, 2001 the Company no longer consolidated the results of Sports.com and accounted for its investment in
Sports.com under the equity method of accounting.

Income Taxes.  No provision for
Federal and state income taxes has been recorded as the Company incurred net operating losses for each period presented.  As of December 31, 2002, the Company had approximately $185,000,000 of net operating loss carryforwards for Federal income
tax purposes, expiring beginning in 2009, available to offset future taxable income.  Additionally, the Company had approximately $93,000,000 of capital loss carryforwards. Given the Companys losses incurred to date and the difficulty in
accurately forecasting the Companys future results, management does not believe that the realization of the related deferred income tax assets meets the criteria required by United States generally accepted accounting principles and,
accordingly, a full valuation allowance has been recorded to reduce the deferred income tax assets to zero.  See Note 10 of Notes to Consolidated Financial Statements.

27



---

##### Table of Contents

In  2002, the Company recorded a tax benefit of $720,000 due to a refund of
alternative minimum taxes paid in 2000.

Quarterly Results of Operations (unaudited)

The tables below set forth the quarterly operating results for 2002 and 2001.  This information is unaudited, but in the opinion of
the Company reflects all adjustments (consisting only of normal recurring adjustments) that the Company considers necessary for a fair presentation of such information in accordance with United States generally accepted accounting principles. The
results for any quarter are not necessarily indicative of results for any future period.

|                                                                                     |                                                       | 2002 Quarter Ended                             |           
|------------------------------------------------------------------------------------ | ----------------------------------------------------- | ---------------------------------------------- | ----------
|                                                                                     |                                                       |                                                |           
|                                                                                     |                                                       | (in thousands except share and per share data) |           
|                                                                                     |                                                       | March                                          |           
|                                                                                     |                                                       |                                                |           
|Revenue                                                                              |                                                       | $                                              | 15,621    
|Cost of revenue                                                                      |                                                       |                                                | 4,889     
|                                                                                     |                                                       |                                                |           
|Gross profit                                                                         |                                                       |                                                | 10,732    
|                                                                                     |                                                       |                                                |           
|Operating Expenses:                                                                  |                                                       |                                                |           
|                                                                                     | Product development                                   |                                                |           
|                                                                                     | Sales and marketing:                                  |                                                |           
|                                                                                     | Amortization of equity issued to Viacom for promotion |                                                |           
|                                                                                     | Other                                                 |                                                |           
|                                                                                     | General and administrative                            |                                                |           
|                                                                                     | Depreciation and amortization                         |                                                |           
|                                                                                     | Write-down of goodwill                                |                                                |           
|                                                                                     | Restructuring charge                                  |                                                |           
|                                                                                     |                                                       |                                                |           
|                                                                                     | Total operating expenses                              |                                                |           
|                                                                                     |                                                       |                                                |           
|Loss from operations                                                                 |                                                       |                                                | (12,263   
|Interest expense                                                                     |                                                       |                                                | (228      
|Interest and other income, net                                                       |                                                       |                                                | 210       
|                                                                                     |                                                       |                                                |           
|Net loss before tax benefit                                                          |                                                       |                                                | (12,281   
|Tax benefit                                                                          |                                                       |                                                |          
|                                                                                     |                                                       |                                                |           
|Net loss                                                                             |                                                       | $                                              | (12,281   
|                                                                                     |                                                       |                                                |           
|Net loss per share  basic and diluted                                               |                                                       | $                                              | (0.34     
|                                                                                     |                                                       |                                                |           
|Weighted average common and common equivalent shares outstanding  basic and
diluted |                                                       |                                                | 36,101,561
|                                                                                     |                                                       |                                                |           
|                                                                                     |                                                       |                                                |           

28



---

##### Table of Contents

|                                                                  |                                                       | 2001 Quarter Ended                             |        
|----------------------------------------------------------------- | ----------------------------------------------------- | ---------------------------------------------- | -------
|                                                                  |                                                       |                                                |        
|                                                                  |                                                       | (in thousands except share and per share data) |        
|                                                                  |                                                       | March                                          |        
|                                                                  |                                                       |                                                |        
|Revenue                                                           |                                                       | $                                              | 22,298 
|Cost of revenue                                                   |                                                       |                                                | 11,163 
|                                                                  |                                                       |                                                |        
|Gross profit                                                      |                                                       |                                                | 11,135 
|                                                                  |                                                       |                                                |        
|Operating Expenses:                                               |                                                       |                                                |        
|                                                                  | Product development                                   |                                                |        
|                                                                  | Sales and marketing:                                  |                                                |        
|                                                                  | Amortization of equity issued to Viacom for promotion |                                                |        
|                                                                  | Other                                                 |                                                |        
|                                                                  | General and administrative                            |                                                |        
|                                                                  | Depreciation and amortization                         |                                                |        
|                                                                  | Write-down of goodwill                                |                                                |        
|                                                                  | Restructuring charge                                  |                                                |        
|                                                                  |                                                       |                                                |        
|                                                                  | Total operating expenses                              |                                                |        
|                                                                  |                                                       |                                                |        
|Loss from operations                                              |                                                       |                                                | (25,162
|Interest expense                                                  |                                                       |                                                | (276   
|Interest and other income, net                                    |                                                       |                                                | 1,617  
|Gain on termination of agreements                                 |                                                       |                                                |       
|Gain on extinguishment of debt                                    |                                                       |                                                |       
|Effect of deconsolidation of Sports.com                           |                                                       |                                                |       
|                                                                  |                                                       |                                                |        
|Net income (loss)                                                 |                                                       | $                                              | (23,821
|                                                                  |                                                       |                                                |        
|                                                                  | Net income (loss) per share  basic                   |                                                | $      
|                                                                  |                                                       |                                                |        
|                                                                  | Net income (loss) per share  diluted                 |                                                | $      
|                                                                  |                                                       |                                                |        
|Weighted average common and common equivalent shares outstanding: |                                                       |                                                |        
|                                                                  | Basic                                                 |                                                |        
|                                                                  |                                                       |                                                |        
|                                                                  | Diluted                                               |                                                |        
|                                                                  |                                                       |                                                |        
|                                                                  |                                                       |                                                |        

29



---

##### Table of Contents

Liquidity and Capital Resources

As of December 31, 2002, the Companys primary source of liquidity consisted of $17,383,000 in cash and cash equivalents.As of December 31, 2002, the Company also had $3,866,000 in current marketable securities, which mature at various dates from January 2003 to March 2003,and $16,376,000 in non-current marketable securities, which have an average maturity of
between twelve and eighteen months.  The Company believes that its current cash and marketable securities will be sufficient to fund its working capital and capital expenditure requirements for at least the next 12 months.  However, the
Company expects to continue to incur significant operating losses for at least the next 12 months.  To the extent the Company requires additional funds to support its operations or the expansion of its business, the Company may sell additional
equity, issue debt or convertible securities or obtain credit facilities through financial institutions.  The sale of additional equity or convertible securities will result in additional dilution to the Companys stockholders.  There
can be no assurance that additional financing, if required, will be available to the Company in amounts or on terms acceptable to the Company.

As of December 31, 2002, deferred advertising and content costs related to the CBS Agreement totaled $9,143,000. These costs represent
the value of the common stock warrants issued at the time of the renewal in exchange for the CBS Agreement extension.  Accrued liabilities totaled $9,216,000 as of December 31, 2002, an increase of $659,000 from December 31, 2001, primarily due
to increases in accruals for cost of revenue sharing and payroll charges.  Long-term liabilities at December 31, 2002 were $6,883,000 compared to $3,818,000 in 2001, an increase of $3,065,000, mainly due to the increase in the accrual related
to the NFL agreement.

Net cash used in operating activities was $7,127,000, $40,916,000 and $34,257,000
for 2002, 2001 and 2000, respectively. The principal uses of cash used in operating activities for all periods were to fund the Companys net losses from operations, partially offset by amortization of equity issued to Viacom, increases in
accrued liabilities, depreciation and amortization and other non-cash charges.

Net cash used in investing
activities was $5,695,000 in 2002 and $5,995,000 in 2000, and net cash provided by investing activities was $22,239,000 in 2001. Investing activities in 2002 consisted primarily of net purchases of marketable securities and to a lesser extent
purchases of property and equipment. Investing activities in 2001 consisted primarily of net proceeds from maturity of marketable securities offset by purchases of property and equipment and intangible assets and the Companys investment in
Sports.com.  The principal uses in 2000 were for purchases of property and equipment offset by net proceeds from the maturity of marketable securities.

Net cash used in financing activities was $117,000 and $17,714,000 for 2002 and 2001, respectively.  Net cash provided by financing
activities was $66,474,000 for 2000.   Financing activities in 2002 consisted primarily of the repurchase of restricted shares of common stock from a former employee. Financing activities in 2001 consisted principally of the repurchase of
the Consideration Shares from DBC for $12,500,000 and the repurchase of 2,500,500 shares of the Companys common stock for aggregate consideration of $5,074,000 on the open market.  Financing activities in 2000 consisted principally of the
issuance of a private placement of preferred stock by Sports.com and the exercise of warrants by CBS. In January 2000, Sports.com raised $52,500,000 through the issuance of Series B Preferred Stock.  In February 2000, CBS exercised warrants to
purchase 500,000 shares of Common Stock resulting in net proceeds of  $11,500,000.

Convertible
Subordinated Notes in an aggregate principal amount of approximately $16,678,000 were outstanding as of December 31, 2002.  The Convertible Subordinated Notes mature in 2006.

The Company has entered into various licensing, royalty and consulting agreements with content providers, vendors and sports
organizations, which agreements provide for consideration in various forms, including issuance of warrants to purchase Common Stock and payment of royalties, bounties and certain other guaranteed amounts on a per member and/or a minimum dollar
amount basis over terms remaining of one to four years.  Additionally, some of these agreements provide for a specified percentage of advertising and merchandising revenue to be paid to the organization from whose Web site the revenue is
derived.  As of December 31, 2002, the minimum guaranteed payments required to be made by the Company under such agreements, including the Companys agreements with

30



---

##### Table of Contents

the NFL, the PGA TOUR and AOL, totaled $31,286,000, of which $5,000,000 is payable in stock at prevailing market prices in lieu of cash at the Companys option.

The following contractual obligations and commercial commitments are payable during the periods
stated:

|                            |  | Years Ending December 31, |       
|--------------------------- |  | ------------------------- | ------
|                            |  |                           |       
|                            |  | (In thousands)            |       
|Type of obligation          |  | Total                     |       
|                            |  |                           |       
|Long-term debt              |  | $                         | 16,678
|Operating leases            |  |                           | 11,363
|Other long-term obligations |  |                           | 31,286
|                            |  |                           |       
|Total obligations           |  | $                         | 59,327



|(1) | $2,333 of which is payable in stock at prevailing market prices in lieu of cash at the Companys option.
|--- | --------------------------------------------------------------------------------------------------------
|(2) | $2,666 of which is payable in stock at prevailing market prices in lieu of cash at the Companys option.

The Company has entered into an agreement with a third party vendor to purchase approximately $1,000,000 worth of computer hardware over
a three-year period.  This purchase is part of the Companys plan to continue to invest in equipment related to the expected growth of the business.  To date, the Company has purchased $720,000 of equipment under the agreement. 
In addition, the Company anticipates purchasing approximately $1,000,000 of additional property and equipment during 2003. These capital expenditures will primarily be computer equipment related to the growth of the business.
  Additionally, the Company intends to continue to pursue acquisitions of or investments in businesses, services and technologies that are complementary to those of the Company.

Related Party Transactions

The Company has had transactions in the normal
course of business with certain officers and directors of the Company.  The terms of these transactions were:

In April 2001, the Company loaned Peter Pezaris, the Companys President, Operations and Product Development, $200,000 at an annual
interest rate of 5.5% secured by 50,000 shares of the Companys common stock owned by Mr. Pezaris.  The loan was made in connection with Mr. Pezaris relocation from New York to the Companys Fort Lauderdale headquarters. 
The loan and accrued interest were paid in full by Mr. Pezaris in December 2001.

The Company contracts for
endorsement and other services of Joe Namath through Planned Licensing, Inc., which is a wholly-owned subsidiary of Namanco Productions, Inc. whose president and sole stockholder is a director of the Company.  The Company has an agreement with
Planned Licensing, Inc. through October 16, 2004.  The Company incurred consulting and royalty expenses related to services provided by Planned Licensing, Inc. of $201,000, $207,000 and $267,000 in 2002, 2001 and 2000, respectively. 
Additionally, in 2000 the Company issued 30,000 common stock warrants to Planned Licensing, Inc. that vest over the life of the agreement.  The Company is obligated to make future minimum payments to Planned Licensing, Inc. totaling $350,000
under this agreement through 2004.

The Company has a strategic alliance with CBS.  As of March 28,
2003, CBS and its affiliates beneficially owned approximately 32% of SportsLines outstanding common stock and pursuant to the terms of the CBS Agreement, as amended in March 2003, SportsLine will issue additional shares of common stock to CBS
on April 1, 2003 which will bring their ownership interest to approximately 39.9% of the Companys outstanding stock.    See Business  Strategic Relationships  CBS, Managements Discussion and
Analysis of Financial Condition and Results of OperationsOverview and Managements Discussion and Analysis of Financial Condition and Results of OperationsRecent Developments.

31



---

##### Table of Contents

Seasonality

The Company
expects that its revenue will be higher leading up to and during major U.S. sports seasons and lower at other times of the year, particularly during the summer months.  In addition, the effect of such seasonal fluctuations in revenue could be
enhanced or offset by revenue associated with major sports events, such as the Olympics, the Ryder Cup and the World Cup, although such events do not occur every year.  The Company believes that advertising sales in traditional media, such as
television, generally are lower in the first and third calendar quarters of each year, and that advertising expenditures fluctuate significantly with economic cycles.  Historically, the first and fourth quarters of each year have been the
strongest for the Company due to the timing of major U.S. sporting events and major sports seasons.  Furthermore, the Company has experienced growth in its revenue from fantasy football products affecting the third and fourth quarter. 
Depending on the extent to which the Internet is accepted as an advertising medium, seasonality and cyclicality in the level of Internet advertising expenditures could become more pronounced.  The foregoing factors could have a material adverse
effect on the Companys business, results of operations and financial condition.

Recent Accounting Pronouncements

In July 2001, the Financial Accounting Standards Board (FASB) issued Statement of Financial Accounting Standard
(SFAS) No. 142, Goodwill and Other Intangible Assets.  SFAS No. 142 addresses financial accounting and reporting for intangible assets acquired individually or with a group of other assets (but not acquired in a business
combination) at acquisition.  SFAS No. 142 also addresses financial accounting and reporting for goodwill and other intangible assets subsequent to acquisition.  With the adoption of SFAS No. 142, goodwill is no longer subject to
amortization.  Rather, goodwill is subject to at least an annual assessment for impairment by applying a fair value-based test, with the initial test required by June 30, 2002.  SFAS No. 142 prescribes a two-phase process for impairment
testing of goodwill.  The first phase of the impairment test is designed to identify potential impairment; while the second phase (if necessary), measures the impairment.  The impairment loss is the amount, if any, by which the implied
fair value of goodwill is less than the book carrying value.  SFAS No. 142 is effective for fiscal years beginning after September 30, 2001.  The Company adopted SFAS No. 142 as of January 1, 2002, and its first phase impairment analysis,
completed by the Company in May 2002, found no instances of impairment of its recorded goodwill; accordingly, the second testing phase, was not necessary.  The Company has performed the annual impairment test required under SFAS No. 142 to test
impairment as of October 1, 2002.  As a result, the Company recorded a goodwill write-down of $2,650,000 to adjust the value of its investment in DBC Sports to its estimated fair value.

In October 2001, the FASB issued SFAS No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets, which is
applicable to financial statements issued for fiscal years beginning after December 15, 2001. The FASBs new rules on asset impairment supercede SFAS No. 121, Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to Be
Disposed Of, and portions of Accounting Principles Board (APB) Opinion No. 30, Reporting the Results of Operations. SFAS No. 144 provides a single accounting model for long-lived assets to be disposed of and significantly
changes the criteria that would have to be met to classify an asset as held-for-sale. Classification as held-for-sale is an important distinction since such assets are not depreciated and are stated at the lower of fair value or carrying amount.
SFAS No. 144 also requires expected future operating losses from discontinued operations to be displayed in the period(s) in which the losses are incurred, rather than as of the measurement date as presently required. The adoption of SFAS No. 144 on
January 1, 2002 did not have a material impact on the Companys consolidated financial statements.

In April 2002, the FASB issued SFAS No. 145, Rescission of FASB Statements No. 4, 44, and 62, Amendment of FASB Statement No. 13, and
Technical Corrections,which is generally applicable to financial statements for fiscal years beginning after May 15, 2002; however, early adoption is encouraged.  SFAS No. 145 eliminates the requirement under SFAS No. 4, Reporting Gains
and Losses from Extinguishment of Debtto report gains and losses from extinguishments of debt as extraordinary items in the income statement.  The Company adopted SFAS No. 145 on July 1, 2002, and has accordingly reclassified the
extraordinary gains of $2,404,000 and $36,027,000, which occurred from its extinguishment of debt in the fourth quarter of 2001 and third and fourth quarters of 1999, respectively.

32



---

##### Table of Contents

In June 2002, the FASB issued SFAS No. 146, Accounting for Costs Associated with
Exit or Disposal Activities,which is generally applicable to financial statements for fiscal years beginning after December 31, 2002; however early adoption is encouraged.  SFAS No. 146 requires that a liability for a cost associated with
an exit or disposal activity be recognized and measured initially at fair value only when the liability is incurred.  The Company adopted SFAS No. 146 on July 1, 2002, and it did not have a material impact on the Companys consolidated
financial statements.

In November 2002, the EITF reached a consensus on Issue 00-21, addressing how to
account for arrangements that involve the delivery or performance of multiple products, services, and/or rights to use assets.  Revenue arrangements with multiple deliverables are divided into separate units of accounting if the deliverables in
the arrangement meet the following criteria: (1) the delivered item has value to the customer on a stand-alone basis; (2) there is objective and reliable evidence of the fair value of undelivered items; and (3) delivery of any undelivered item is
probable.  Arrangement consideration should be allocated among the separate units of accounting based on their relative fair values, with the amount allocated to the delivered item being limited to the amount that is not contingent on the
delivery of additional items or meeting other specified performance conditions.  The final consensus will be applicable to agreements entered into in fiscal periods beginning after June 15, 2003 with early adoption permitted.  The
provisions of this consensus are not expected to have a significant effect on the Companys financial position or operating results.

In December 2002, the FASB issued SFAS No. 148 Accounting for Stock-Based Compensation  Transition and
Disclosure.   This statement amends SFAS No. 123 Stock-Based Compensation, to provide alternative methods of transition for a voluntary change to the fair value based method of accounting for stock based
employee compensation.  In addition, this statement amends the disclosure requirements of SFAS No. 123 to require prominent disclosures in both annual and interim financial statements about the method used on reported results.  The
disclosure provisions of this standard are effective for fiscal years ending after December 15, 2002 and have been incorporated in the Companys consolidated financial statements and notes thereto.

Risk Factors That May Affect Future Results

SportsLines business and
the value of its stock are subject to a number of risks.  Some of those risks are described below.

We operate in a difficult market environment.

The Internet-based advertising, information services and commerce markets in which we operate experience frequent and substantial
changes.  Additionally, we face intense competition and we must effectively manage our growth and respond quickly to rapid changes in customer demands and industry standards.  To address these risks, among others, we must provide
compelling and original content to our users, maintain our existing relationships and effectively develop new relationships with advertisers, advertising agencies and other third parties, develop and upgrade our technology and respond to competitive
developments, and attract, retain and motivate qualified personnel.  We may not succeed in addressing these challenges and risks.

We have an accumulated deficit and we anticipate further
losses.

We have incurred significant losses since we began doing business and it is possible that we
may never generate sufficient revenue to meet our expenses or achieve or maintain profitability.  We incurred net losses of $35.5 million during 1998, $17.1 million during 1999, $106.1 million during 2000, $61.1 million during 2001 and $48.2
million during 2002.  As of December 31, 2002, we had an accumulated deficit of $324.9 million.  We expect to continue to incur operating losses for at least the next twelve months.

Since inception, we have incurred substantial costs to develop and enhance our technology, to create, introduce and enhance our service
offerings, to acquire and develop content, to build traffic on our Web sites, to acquire members, to establish marketing relationships and to build an administrative organization and we intend to continue these efforts. We have entered into various
licensing, royalty and consulting agreements with content

33



---

##### Table of Contents

providers, vendors, athletes and sports organizations, including, among others, the NFL, the PGA TOUR and AOL, which agreements provide for consideration in various forms,
including issuance of shares of our common stock and/or warrants to purchase shares of our common stock and payment of royalties, bounties and certain other guaranteed amounts on a per member and/or a minimum dollar amount basis over terms ranging
from one to ten years. Additionally, some of these agreements provide for a specified percentage of advertising and merchandising revenue to be paid to the athlete or organization from whose Web site the revenue is derived.  As of December 31,
2002, the minimum guaranteed payments we were required to make under such agreements totaled $31,286,000, of which $5,000,000 is payable in stock at prevailing market prices in lieu of cash at the Companys option.  See  
Liquidity and Capital Resources.  Also, we recorded non-cash expense of approximately $22,000,000 and $17,000,000 in each of the years ended December 31, 2002 and 2001, related to our agreement with CBS and will record an additional
$89,000,000 of non-cash expense over the remaining term of our agreement with CBS.

We may need additional capital and the future funding of these capital needs is
uncertain.

As of December 31, 2002, our primary source of liquidity consisted of $17,383,000 in cash
and cash equivalents, $3,866,000 in current marketable securities, which mature at various dates from January 2003 to March 2003, and $16,376,000 of long-term marketable securities with average maturity dates between twelve and eighteen
months.  We believe that our current cash and marketable securities will be sufficient to fund our working capital and capital expenditure requirements for at least the next 12 months.  However, we expect to continue to incur significant
operating losses for such period.  To the extent we require additional funds to support our operations or the expansion of our business, we may need to sell additional equity, issue debt or convertible securities or obtain credit facilities
through financial institutions.  The sale of additional equity or convertible securities will result in additional dilution to our stockholders and the rights, preferences or privileges of the new security holders may be senior to those of the
existing common stockholders.  If we are unable to raise additional funds on favorable terms, we may be required to cut our expenditures, which may affect our ability to expand our business, support our operations and generate sustained
revenues.  There can be no assurance that additional financing, if required, will be available in amounts or on terms acceptable us or at all.

Financial results for any particular
period will not predict results for future periods.

There can be no assurance that the
purchasing pattern of customers advertising on the SportsLine network of Web sites will not continue to fluctuate, that advertisers will not make smaller and shorter-term purchases, or that market prices for online advertising will not decrease due
to competitive or other factors.  In addition, there can be no assurance that consumers will continue to purchase memberships or the fantasy and other subscription and premium products we offer at the times or in the same volumes as they have
in any particular sports season or fiscal period.  Because of the rapidly changing market we serve, period-to-period comparisons of operating results are not likely to be meaningful.  You should not rely on the results for any period as an
indication of future performance.

Our quarterly results may fluctuate seasonally.

We expect that our revenue will be higher leading up to and during major U.S. sports seasons and lower at other times of the year,
particularly during the summer months.  In addition, the effect of such seasonal fluctuations in revenue could be enhanced or offset by revenue associated with major sports events, such as the Olympics and World Cup events, although such events
do not occur every year.  We believe that advertising sales in traditional media, such as television, generally are lower in the first and third calendar quarters of each year, and that advertising expenditures fluctuate significantly with
economic cycles.  The growth of our subscription fantasy business may heighten such seasonal fluctuations based on major U.S. sports seasons.  Depending on the extent to which the Internet is accepted as an advertising medium, seasonality
and cyclicality in the level of Internet advertising expenditures could become more pronounced in which case our revenues may be affected by such seasonal and cyclical patterns.

34



---

##### Table of Contents

We rely heavily on revenues derived from Internet advertising, which are subject to uncertain demand from our current and potential clients and are difficult to forecast
accurately.

Currently, the majority of our revenues come from advertisements displayed on our online
properties. Our ability to continue to achieve substantial advertising revenue depends upon:

| |  | growth of our user base;                                                      
| | - | ------------------------------------------------------------------------------
| |   |                                                                               
| |  | our user base being attractive to advertisers;                                
| |   |                                                                               
| |  | our ability to derive better demographic and other information from our users;
| |   |                                                                               
| |  | acceptance by advertisers of the Web as an advertising medium; and            
| |   |                                                                               
| |  | our ability to transition and expand into other forms of advertising.         

Most of our revenues are currently derived from agreements with advertisers or sponsorship arrangements. These agreements generally have
terms no longer than three years and, in many cases, the terms are much shorter. In cases where the advertiser is providing services, the agreements often have payments contingent on usage levels. Accordingly, it is difficult to accurately forecast
these revenues. However, our expense levels are based in part on expectations of future revenues and are fixed over the short term with respect to certain categories. We may be unable to adjust spending quickly enough to compensate for any
unexpected revenue shortfall. Accordingly, the cancellation or deferral of advertising or sponsorship contracts could have a material adverse effect on our financial results.  Although none of our advertising clients accounted for more than 9%
of our consolidated revenue during 2002, if we lose several of our more significant advertising clients, or if these clients substantially reduce their advertising purchases from us, our advertising revenues could be adversely affected.

Our revenues also could be adversely affected if we are unable to adapt to other Internet advertising pricing models
that are adopted as industry standard.  It is difficult to predict which, if any, pricing models for Internet advertising will emerge as the industry standard.  This makes it difficult to project our future advertising rates and
revenues.

The rate structure of some of our sponsorship arrangements subjects us to financial risk.

A key element of our strategy is to generate advertising revenues through sponsored services and placements by third parties in our
online media properties in addition to banner advertising. We typically receive sponsorship fees or a portion of transaction revenues in return for minimum levels of user impressions to be provided by us. These arrangements expose us to potentially
significant financial risks in the event our usage levels decrease, including the following:

| |  | the fees we are entitled to receive may be adjusted downwards;                                                                                                                         
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |   |                                                                                                                                                                                        
| |  | we may be required to make good on our obligations by providing alternative services;                                                                                                
| |   |                                                                                                                                                                                        
| |  | the sponsors may not renew the agreements or may renew at lower rates; and                                                                                                             
| |   |                                                                                                                                                                                        
| |  | the arrangements may not generate anticipated levels of shared transaction revenues, or sponsors may default on the payment commitments in such agreements as has occurred in the
past.

Accordingly, any leveling off or decrease of our user base or the failure to
generate anticipated levels of shared transaction revenues could result in a significant decrease in our revenue levels.

We rely upon our strategic relationships in order to execute our
business plan.

In March 1997, we entered into a five-year agreement with CBS, pursuant to which our
flagship Web site was renamed cbs.sportsline.com.  We amended our agreement with CBS in February 1999 to extend the term through 2006.  Over the term of the agreement, we have the right to use certain CBS logos and
television-related sports content and will receive extensive network

35



---

##### Table of Contents

television advertising and on-air promotions. This network television advertising and on-air promotions, as well as the association of our brand with CBS, are important
elements of our strategy to increase awareness of the SportsLine brand and build traffic on our Web sites.  Under the agreement, CBS has the right to receive specified percentages of our net revenues.  The agreement requires us to maintain
and operate our flagship Web site, cbs.sportsline.com, in accordance with certain guidelines and restrictions and to cease using any content on cbs.sportsline.com which CBS determines conflicts, interferes with or is detrimental to the reputation or
business of CBS or which becomes subject to any third party restriction or claim which would prohibit, limit or restrict the use of such content on the Internet.  CBS has the right to terminate the agreement upon the acquisition by a CBS
competitor of 40% or more of the voting power of our equity securities or in certain other circumstances, including if we breach a material term or condition of the agreement or if we become insolvent or subject to bankruptcy or similar
proceedings.

The Company believes that its relationship with CBS, in particular the branding of its
flagship Web site as cbs.sportsline.com and the promotion the Company receives on CBS television broadcasts, has been important in establishing SportsLine as a broadly recognized consumer brand.  We cannot assure you that CBS will
perform its obligations under the agreement.  If the agreement with CBS were to terminate and the Company was unable to establish a strategic relationship with another promotional partner of similar stature on similar or more favorable terms,
it could have a material adverse effect on our business, results of operations and financial condition.

In addition to our relationship with CBS, we have entered into strategic relationships with other parties including the NFL, the NCAA,
AOL and the PGA TOUR, and various sports superstars and personalities and other sports organizations.  We rely on these relationships to increase awareness of our brand among consumers, to create revenue opportunities and to obtain content for
our Web sites.  We cannot assure you that a party to any of our strategic agreements will perform its obligations as agreed or that we will be able to specifically enforce any such agreement.  Many of these strategic agreements are
short-term in nature and either party on short notice may terminate certain of these agreements.  Our failure to maintain or renew these existing strategic relationships, to establish additional strategic relationships or to fully capitalize on
any such relationship could have a material adverse effect on our business, results of operations and financial condition.

CBS beneficially owns approximately 32% of our outstanding common
stock and their interests could conflict with yours.

As of March 28, 2003, CBS and its affiliates
beneficially owned approximately 32% of SportsLines outstanding common stock and pursuant to the terms of our agreement with CBS, as amended in March 2003, we will issue additional shares of common stock to CBS on April 1, 2003 which will
bring their ownership interest to approximately 39.9% of our outstanding stock.  Messrs. Sean McManus and Russell Pillar, members of our board of directors, are also employees of CBS and Viacom Inc., the parent company of CBS,
respectively.  As a result of CBSs ownership stake and representation on our board of directors, CBS may be able to significantly influence matters requiring stockholder approval, including the election of directors and approval of
significant corporate transactions. Furthermore, pursuant to our agreement with CBS, upon a change of control we may be required to accelerate the issuance of shares of common stock that are otherwise scheduled to be issued over the term of our
agreement.  Such concentration of ownership and the provision for the acceleration of future stock issuances may have the effect of delaying or preventing a change in control of SportsLine.  In addition, sales of significant amounts of
shares held by CBS, or the prospect of these sales, could adversely affect the market price of our common stock.

We may not be able to compete successfully.

The market for Internet services and products is highly competitive and we expect that competition will continue to intensify. 
Competition could result in less user traffic to our Web sites, price reductions for our advertising, reduced margins or loss of market share, any of which would have a material adverse effect on our business, results of operations and financial
condition.

We compete, directly and indirectly, for advertisers, viewers, members, content providers,
merchandise sales and rights to sports events with the following categories of companies:

36



---

##### Table of Contents

| |  | Web sites targeted to sports enthusiasts generally (such as espn.com, si.com, sports.yahoo.com and foxsports.com) or to enthusiasts of particular sports (such as Web sites
maintained by the NBA, MLB and the NHL),
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |   |                                                                                                                                                                                                                     
| |  | publishers and distributors of traditional off-line media (such as television, radio and print), including those targeted to sports enthusiasts, many of which have established
or may establish Web sites,         
| |   |                                                                                                                                                                                                                     
| |  | general purpose consumer online services such as AOL and MSN, each of which provides access to sports-related content and services,                                                                                 
| |   |                                                                                                                                                                                                                     
| |  | vendors of sports information, merchandise, products and services distributed through other means, including retail stores, mail, facsimile and private bulletin board services,
and                                
| |   |                                                                                                                                                                                                                     
| |  | Web search and retrieval services and portals, such as Google, Lycos, Netscape and Yahoo!, and other high-traffic Web sites.                                                                                        

Our ability to compete depends on many factors, many of which are outside of our control.  These factors include the quality of
content provided by us and by our competitors, the ease of use of services developed either by us or by our competitors, the timing and market acceptance of new and enhanced services developed either by us or by our competitors, and sales and
marketing efforts by us and our competitors.

Based on our review of publicly available documents, we
believe some of our existing competitors, as well as potential new competitors, have longer operating histories, significantly greater financial, technical and marketing resources, greater name recognition and substantially larger user or membership
bases than we do.  This may allow them to devote greater resources than we can to the development and promotion of their services.  In addition, some of these competitors may be able to respond more quickly than us to new or emerging
technologies and changes in Internet user requirements and to devote greater resources than us to the development, promotion and sale of their services.  There can be no assurance that our current or potential competitors will not develop
products and services comparable or superior to those developed by us or adapt more quickly than us to new technologies, evolving industry trends or changing Internet user preferences.  In addition, as we expand internationally we are likely to
face new competition.  There can be no assurance that we will be able to compete successfully against current and future competitors, or that competitive pressures would not have a material adverse effect on our business, results of operations
and financial condition.

More individuals are utilizing non-PC devices to access the Internet and we may not be successful in developing a version of our service that will gain widespread
adoption by users of such devices.

In the coming years, the number of individuals who access the
Internet through devices other than a personal computer (such as personal digital assistants, cellular telephones and television set-top devices) is expected to increase dramatically. Our services are designed for rich, graphical environments such
as those available on personal and laptop computers. The lower resolution, functionality and memory associated with alternative devices may make the use of our services through such devices difficult and we may be unsuccessful in our efforts to
modify our online properties to provide a compelling service for users of alternative devices. As we have limited experience to date in operating versions of our service developed or optimized for users of alternative devices, it is difficult to
predict the problems we may encounter in doing so and we may need to devote significant resources to the creation, support and maintenance of such versions. If we are unable to attract and retain a substantial number of alternative device users to
our online services, we may fail to capture a sufficient share of an increasingly important portion of the market for online services. Further, as the majority of our revenues are derived through the sale of banner and other advertising optimized
for a personal computer screen, we may not be successful at developing a viable strategy for deriving substantial revenues from online properties that are directed at the users of alternative devices. Any failure to develop revenue-generating online
properties that are adopted by a significant number of alternative device users could have a material adverse effect on our business, operating results and financial condition.

37



---

##### Table of Contents

We are dependent on certain content providers and are required to make significant payments to such content providers

We rely on independent content providers, including professional sports organizations, for sports news, scores, statistics and other
sports information.  Our future success depends, in significant part, on our ability to maintain and renew our relationships with these content providers and to build new relationships with other content providers.  Our agreements with
content providers generally are short-term and may be terminated by the content provider if we fail to fulfill our obligations under the applicable agreement.  Some of our content providers compete with one another and, to some extent, with us
for advertising and members.  Termination of one or more significant content provider agreements would decrease the availability of sports news and information which we can offer our customers and could have a material adverse effect on our
business, results of operations and financial condition.

Most of our agreements with content providers are
nonexclusive, and many of our competitors offer, or could offer, content that is similar or the same as that obtained by us from such content providers.  In addition, the growing reach and use of the Internet have further intensified
competition in this industry.  Consumers have gained free access to certain information provided directly on the Internet by certain content providers.  To the extent that content providers, including but not limited to our current
suppliers, provide information to users at a lower cost than us or at minimal or no cost, our business, results of operations and financial condition could be materially adversely affected.

Fees payable to content providers constitute a significant portion of our cost of revenue.  There can be no assurance that these
content providers will enter into or renew agreements with us on the same or similar terms as those currently in effect.  If we are required to increase the fees payable to our content providers, such increased payments could have a material
adverse effect on our business, results of operations and financial condition.

We may not be able to protect our proprietary rights and we may infringe the proprietary rights of
others

Proprietary rights are important to our success and competitive position.  In 1996, we
were issued a United States trademark registration for our former SportsLine USA logo.  We have applied to register in the United States a number of marks, several of which include the term SportsLine.  We have filed
applications to register SportsLine marks in Australia, the United Kingdom and other countries.  We cannot assure you that we will be able to secure adequate protection for these trademarks in the United States or in foreign
countries.  Although we seek to protect our proprietary rights, our actions may be inadequate to protect any trademarks and other proprietary rights or to prevent others from claiming violations of their trademarks and other proprietary
rights.  In addition, effective copyright and trademark protection may be unenforceable or limited in certain countries, and the global nature of the Internet makes it impossible to control the ultimate destination of our work.  We also
license content from third parties and it is possible that we could become subject to infringement actions based upon the content licensed from those third parties.  We generally obtain representations as to the origin and ownership of such
licensed content; however, this may not adequately protect us.  Any of these claims, with or without merit, could subject us to costly litigation and divert the attention of our technical and management personnel.

We hold rights to various Web domain names, including cbs.sportsline.com, golfweb.com and
vegasinsider.com, among others.  Governmental agencies typically regulate domain names.  These regulations are subject to change.  We may not be able to acquire or maintain appropriate domain names in all countries in
which we do business.  Furthermore, regulations governing domain names may not protect our trademarks and similar proprietary rights.  We may be unable to prevent third parties from acquiring domain names that are similar to, infringe upon
or diminish the value of our trademarks and other proprietary rights.

Our business is at risk of system failures, delays and inadequacy

The performance of our Web sites is critical to our reputation and ability to attract and retain users, advertisers and members. 
Services based on sophisticated software and computer systems often encounter development delays and the underlying software may contain undetected errors or failures when introduced.  Any system error or failure that causes interruption in
availability or an increase in response time could result in a loss of

38



---

##### Table of Contents

potential or existing users, advertisers or members and, if sustained or repeated, could reduce the attractiveness of our Web sites to users and advertisers.  A sudden
and significant increase in the number of users of our Web sites also could strain the capacity of the software, hardware or telecommunications systems we deploy, which could lead to slower response time or system failures.  In addition, if the
number of Web pages or users of our Web sites increases substantially, our hardware and software infrastructure may not be able to adequately handle the increased demand.  Our operations also are dependent upon receipt of timely feeds and
computer downloads from content providers, and any failure or delay in the transmission or receipt of such feeds and downloads, whether on account of our system failure, our content providers, the public network or otherwise, could disrupt our
operations.  Any failure or delay that causes interruptions in our operations could have a material adverse effect on our business, results of operations and financial condition.

Our
success is dependent on our key personnel

Our future success depends, in part, upon the continued
service of our senior management and other key personnel.  Although we have entered into employment agreements with Michael Levy, our President and Chief Executive Officer, and each of our other executive officers, the loss of his services or
the services of one or more of our other executive officers or key employees could have a material adverse effect on our business, results of operations and financial condition.  Our future success also depends on our continuing ability to
attract and retain highly qualified technical, editorial and managerial personnel.   We have, at times, experienced difficulties in attracting the desired number of such individuals.

We may not be able to adapt as Internet technologies and customer demands continue to evolve

To be successful, we must adapt to rapidly changing Internet technologies by continually enhancing our Web sites and introducing new
services to address our customers changing demands.  We could incur substantial costs if we need to modify our services or infrastructure in order to adapt to changes affecting providers of Internet services.  Our business, results
of operations and financial condition could be materially adversely affected if we incur significant costs to adapt, or cannot adapt, to these changes.

Concerns regarding security of
transactions and transmitting confidential information over the Internet

A significant barrier to
electronic commerce and communications is the secure transmission of confidential information over public networks.  We rely on encryption and authentication technology licensed from third parties to provide the security and authentication
necessary to effect secure transmission of confidential information.  We cannot assure you that advances in computer capabilities, new discoveries in the field of cryptography or other events or developments will not result in a compromise or
breach of the algorithms we use to protect customer transaction data.  If any such compromise of our security were to occur it could have a material adverse effect on our business, results of operations and financial condition.  If someone
is able to circumvent our security measures, such person could misappropriate proprietary information or cause interruptions in our operations.  We may be required to expend significant capital and other resources to protect against the threat
of such security breaches or to alleviate problems caused by such breaches.  Concerns over the security of Internet transactions and the privacy of users may also inhibit the growth of the Internet generally, and the Web in particular,
especially as a means of conducting commercial transactions.  To the extent that our activities or the activities of third party contractors involve the storage and transmission of proprietary information, such as credit card numbers, security
breaches could expose us to a risk of loss or litigation and possible liability.  We cannot assure you that our security measures will prevent security breaches or that failure to prevent such security breaches would not have a material adverse
effect on our business, results of operations and financial condition.

Regulatory and legal uncertainties could harm our business

The application of existing laws and regulations to SportsLine and its advertising clients with respect to issues such as the protection
of databases, user privacy, pricing, advertising, taxation, gambling, sweepstakes, promotions, content regulation, quality of products and services and intellectual property ownership and infringement can be unclear. In addition, SportsLine or its
clients may also be subject to new laws and regulations

39



---

##### Table of Contents

directly applicable to our respective activities.  Any existing or new legislation applicable to SportsLine could expose it to substantial liability, including
significant expenses necessary to comply with such laws and regulations, and dampen the growth in use of the Web.  Any new laws or regulations applicable to any of our advertising clients may reduce or eliminate their ability or desire to
advertise their services on our online properties and could therefore have a material adverse effect on our business, results of operations and financial condition.

Several Federal laws could have an impact on SportsLines business. The Digital Millennium Copyright Act is intended to reduce the
liability of online service providers for listing or linking to third-party Web sites that include materials that infringe copyrights or other rights of others. The Childrens Online Protection Act and the Childrens Online Privacy
Protection Act are intended to restrict the distribution of certain materials deemed harmful to children and impose additional restrictions on the ability of online services to collect user information from minors. In addition, the Protection of
Children From Sexual Predators Act of 1998 requires online service providers to report evidence of violations of Federal child pornography laws under certain circumstances. Such legislation may impose significant additional costs on our business or
subject us to additional liabilities.

SportsLine posts its privacy policy and practices concerning the use
and disclosure of user data.  Any failure by the Company to comply with its posted privacy policy, requirements of the FTC regarding user privacy, or other privacy-related laws and regulations could result in proceedings by the FTC or others
which could potentially have an adverse effect on SportsLines business, results of operations and financial condition. In this regard, there are a large number of legislative proposals before the United States Congress and various state
legislative bodies regarding privacy issues related to SportsLines business.  It is not possible to predict whether or when such legislation may be adopted, and certain proposals, if adopted, could materially and adversely affect the
Companys business through a decrease in user registrations and revenues.  This could be caused by, among other possible provisions, the required use of disclaimers or other requirements before users can utilize SportsLines services.

Our contests and sweepstakes may be subject to state and Federal laws governing lotteries and
gambling.  We seek to design our contest and sweepstakes rules to fall within exemptions from such laws and restrict participation to individuals over 18 years of age who reside in jurisdictions within the United States and Canada in which the
contests and sweepstakes are lawful.  We cannot assure you that our contests and sweepstakes will be exempt from such laws or that the applicability of such laws to us would not have a material adverse effect on our business, results of
operations and financial condition.

Through LVSC, we are currently engaged in the business of selling and
providing certain information to casinos doing business in Nevada.  As such, LVSC is required to be licensed as an information service provider as that term is defined by the Nevada Act and is subject to the regulatory jurisdiction
of the Nevada Gaming Authorities.  Our wholly owned subsidiary, VegasInsider, has filed an application to be found suitable as an intermediary holding company, and we have filed an application to be registered as a publicly traded
company.   In addition, certain of our officers and the officers of certain of our subsidiaries filed applications to be found suitable as officers of the respective companies.  We have recently declared our intention to sell LVSC and
VegasInsider and thereupon seek withdrawal of all applications.  However, LVSC and VegasInsider intend to continue their respective business operations pending such sale.  If, prior to the sale, the Nevada Gaming Authorities determine that
LVSC, VegasInsider or SportsLine are unsuitable, LVSC may be required to cease the business of providing odds information to Nevadas licensed sports books, within a time frame prescribed by the Nevada Gaming Commission.   See
BusinessGovernment Regulation and Legal Uncertainties  Nevada Regulation and Licensing.

We may be liable for the content we make available on the Internet

We may be subject to legal claims relating to the content we make available on our Web sites, or the downloading and
distribution of such content.  For example, persons may bring claims against us if material that is inappropriate for viewing by young children can be accessed from our Web sites.  Claims could also involve such matters as defamation,
invasion of privacy and copyright infringement.  Providers of Internet products and services have been sued in the past, sometimes successfully, based on the content of material. Although we carry general liability insurance, our insurance may
not cover potential claims of this type or may not be adequate to cover all costs incurred in defense of potential claims or to indemnify us for all liability that may be imposed.  Any costs or

40



---

##### Table of Contents

imposition of liability that is not covered by insurance or in excess of insurance coverage could have a material adverse effect on our business, results of operations and
financial condition.  Implementing measures to reduce our exposure to this liability may require us to spend substantial resources and limit the attractiveness of our service to users.

Our
consolidated financial statements as of and for the years ended December 31, 2001 and 2000 included in this Form 10-K were audited by Arthur Andersen LLP, which has been found guilty of obstruction of justice and may be the subject of additional
litigation.

Arthur Andersen LLP, the independent public accountants that audited our financial
statements for the fiscal years ended December 31, 2001 and 2000, was found guilty by a jury on June 15, 2002 of obstruction of justice in connection with the governments investigation of Enron Corp.  Arthur Andersen ceased practicing
before the Securities and Exchange Commission (the SEC) effective August 31, 2002. It is possible that events arising out of the indictment may adversely affect the ability of Arthur Andersen to satisfy any claims arising from its
provision of auditing and other services to us, including claims that may arise out of Arthur Andersens audits of our financial statements. The SEC has said that it will continue accepting financial statements audited or reviewed by Arthur
Andersen provided that issuers comply with the applicable rules and orders issued by the SEC in March 2002 for such purpose.

In the future, should we seek to access the public capital markets, SECs current rules require the inclusion or incorporation by
reference of three years of audited financial statements in any prospectus. These rules would require us to present audited financial statements for one or more fiscal years audited by Arthur Andersen until our audited financial statements for the
fiscal year ending December 31, 2004 become available in the first quarter of the 2005. The SEC recently adopted rules exempting certain issuers filing Securities Act registration statements containing financial statements audited by Arthur Andersen
from having to comply with rules that would also require such issuers to present manually signed reissued accountants reports and written consents issued by Arthur Andersen. Although we believe that we currently meet the requirements for such
exemptions, if the SEC ceases accepting financial statements audited by Arthur Andersen pursuant to such exemptions, it is possible that our financial statements for the years ended December 31, 2001 and December 31, 2000 audited by Arthur Andersen
might not satisfy the SECs requirements. If this occurs, we would not be able to access the public capital markets unless Ernst & Young LLP, our current independent accounting firm, or another independent accounting firm, is able to audit
the financial statements originally audited by Arthur Andersen. Any delay or inability to access the public capital markets caused by those circumstances could have a material adverse effect on our business, financial condition or results of
operation.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk.

The Companys exposure to market rate risk for changes in interest rates relates primarily to the Companys investment
portfolio.  The Company has not used derivative financial instruments in its investment portfolio. The Company invests its excess cash in debt instruments of the U.S. Government and its agencies, and in high-quality corporate issuers and, by
policy, limits the amount of credit exposure to any one issuer.  The Company protects and preserves its invested funds by limiting default, market and reinvestment risk.

Investments in both fixed rate and floating rate interest earning instruments carries a degree of interest rate risk. Fixed rate
securities may have their fair market value adversely impacted due to a rise in interest rates, while floating rate securities may produce less income than expected if interest rates fall. Due in part to these factors, the Companys future
investment income may fall short of expectations due to changes in interest rates or the Company may suffer losses in principal if forced to sell securities which have declined in market value due to changes in interest rates.

41



---

##### Table of Contents

Item 8.    Financial Statements and Supplementary Data.

Index to Financial Statements

|                                                                                                                | Page
|--------------------------------------------------------------------------------------------------------------- | ----
|                                                                                                                |     
|Reports of Independent Certified Public Accountants                                                             | 43  
|                                                                                                                |     
|Consolidated Balance Sheets as of December 31, 2002 and 2001                                                    | 45  
|                                                                                                                |     
|Consolidated Statements of Operations for the years ended December 31, 2002, 2001 and 2000                      | 46  
|                                                                                                                |     
|Consolidated Statements of Changes in Shareholders Equity for the years ended December 31, 2002, 2001 and 2000 | 47  
|                                                                                                                |     
|Consolidated Statements of Cash Flows for the years ended December 31, 2002, 2001 and 2000                      | 49  
|                                                                                                                |     
|Notes to Consolidated Financial Statements.                                                                     | 51  

42



---

##### Table of Contents

REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS

Board of Directors SportsLine.com, Inc.

We have audited the accompanying consolidated balance sheet of SportsLine.com, Inc. as of December 31, 2002, and the related consolidated statements of operations, changes in shareholders equity and cash flows for the
year then ended. 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 audit. The financial statements of SportsLine.com, Inc. for
the years ended December 31, 2001 and 2000 were audited by other auditors who have ceased operations and whose report dated January 25, 2002 expressed an unqualified opinion on those statements.

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

In our opinion, the
financial statements referred to above present fairly, in all material respects, the consolidated financial position of SportsLine.com, Inc. at December 31, 2002 and the consolidated results of its operations and its cash flows for the year then
ended, in conformity with accounting principles generally accepted in the United States.

As discussed above, the financial statements of SportsLine.com, Inc. for the years ended December 31, 2001
and 2000 were audited by other auditors who have ceased operations. As described in Note 2, these financial statements have been revised to include the transitional disclosures required by Statement of Financial Accounting Standards No. 142,
Goodwill and Other Intangible Assets, which was adopted by the Company as of January 1, 2002. Our audit procedures with respect to the disclosures in Note 2 with respect to 2001 and 2000 included (a) agreeing the previously reported net loss
to the previously issued financial statements and the adjustments to reported net loss representing amortization expense recognized in those periods related to goodwill to the Companys underlying records obtained from management, and (b)
testing the mathematical accuracy of the reconciliation of reported net loss to adjusted net loss, and the related adjusted loss-per-share amounts. In our opinion, the disclosures for 2001 and 2000 in Note 2 are appropriate. However, we were not
engaged to audit, review, or apply any procedures to the 2001 or 2000 financial statements of the Company other than with respect to such disclosures and, accordingly, we do not express an opinion or any other form of assurance on the 2001 or 2000
financial statements taken as a whole.

|                             | /S/ ERNST & YOUNG LLP            | 
|---------------------------- | -------------------------------- | 
|                             |                                  | 
|Ft. Lauderdale, Florida      |                                  | 
|January 27, 2003, except for |                                  | 
|                             | Note 13, as to which the date is | 
|                             | March 24, 2003                   | 

43



---

##### Table of Contents

THIS REPORT IS A COPY OF A REPORT PREVIOUSLY ISSUED BY ARTHUR ANDERSEN LLP. THE REPORT HAS NOT BEEN REISSUED BY ARTHUR ANDERSEN LLP NOR HAS ARTHUR ANDERSEN LLP
PROVIDED A CONSENT TO THE INCLUSION OF ITS REPORT IN THIS FORM 10-K.

REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS

To
SportsLine.com, Inc.:

We have audited the accompanying consolidated balance sheets of SportsLine.com, Inc. (a Delaware corporation) and
subsidiaries as of December 31, 2001 and 2000, and the related consolidated statements of operations, changes in shareholders equity and cash flows for each of the three years in the period ended December 31, 2001. 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 in accordance with auditing standards generally accepted in the United States. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of SportsLine.com, Inc. and
subsidiaries as of December 31, 2001 and 2000, and the results of their operations and their cash flows for each of the three years in the period ended December 31, 2001, in conformity with accounting principles generally accepted in the United
States.

|ARTHUR ANDERSEN LLP       | 
|------------------------- | 
|                          | 
|Fort Lauderdale, Florida, | 
|January 25, 2002.         | 

44



---

##### Table of Contents

SPORTSLINE.COM, INC. AND SUBSIDIARIESCONSOLIDATED BALANCE SHEETS(amounts in thousands, except share data)

|                                     |                                                                                                                                                                            | December 31, |       
|------------------------------------ | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------ | ------
|                                     |                                                                                                                                                                            |              |       
|                                     |                                                                                                                                                                            | 2002         |       
|                                     |                                                                                                                                                                            |              |       
|ASSETS                               |                                                                                                                                                                            |              |       
|CURRENT ASSETS:                      |                                                                                                                                                                            |              |       
|                                     | Cash and cash equivalents                                                                                                                                                  |              | $     
|                                     | Marketable securities                                                                                                                                                      |              |       
|                                     | Accounts receivable, net                                                                                                                                                   |              |       
|                                     | Due from CBS                                                                                                                                                               |              |       
|                                     | Prepaid expenses and other current assets                                                                                                                                  |              |       
|                                     |                                                                                                                                                                            |              |       
|                                     | Total current assets                                                                                                                                                       |              |       
|DEFERRED ADVERTISING AND CONTENT     |                                                                                                                                                                            |              | 9,143 
|PROPERTY AND EQUIPMENT, net          |                                                                                                                                                                            |              | 7,567 
|NONCURRENT MARKETABLE SECURITIES     |                                                                                                                                                                            |              | 16,376
|GOODWILL                             |                                                                                                                                                                            |              | 18,211
|OTHER ASSETS, net                    |                                                                                                                                                                            |              | 7,894 
|                                     |                                                                                                                                                                            |              |       
|                                     |                                                                                                                                                                            | $            | 91,988
|                                     |                                                                                                                                                                            |              |       
|LIABILITIES AND SHAREHOLDERS EQUITY |                                                                                                                                                                            |              |       
|CURRENT LIABILITIES:                 |                                                                                                                                                                            |              |       
|                                     | Accounts payable                                                                                                                                                           |              | $     
|                                     | Accrued liabilities                                                                                                                                                        |              |       
|                                     | Due to CBS                                                                                                                                                                 |              |       
|                                     | Deferred revenue                                                                                                                                                           |              |       
|                                     |                                                                                                                                                                            |              |       
|                                     | Total current liabilities                                                                                                                                                  |              |       
|OTHER LONG TERM LIABILITIES          |                                                                                                                                                                            |              | 2,563 
|LONG TERM LIABILITIES  NFL          |                                                                                                                                                                            |              | 4,320 
|CONVERTIBLE SUBORDINATED NOTES       |                                                                                                                                                                            |              | 16,678
|                                     |                                                                                                                                                                            |              |       
|                                     | Total liabilities                                                                                                                                                          |              |       
|                                     |                                                                                                                                                                            |              |       
|COMMITMENTS AND CONTINGENCIES        |                                                                                                                                                                            |              |       
|SHAREHOLDERS EQUITY:                |                                                                                                                                                                            |              |       
|                                     | Preferred stock, $0.01 par value, 1,000,000 shares authorized, none issued and outstanding as of
December 31, 2002 and December 31, 2001                                   |              |       
|                                     | Common stock, $0.01 par value, 200,000,000 shares authorized, 38,256,024 and 29,218,936 issued and outstanding as of
December 31, 2002 and December 31, 2001, respectively |              |       
|                                     | Additional paid-in capital                                                                                                                                                 |              |       
|                                     | Accumulated other comprehensive income                                                                                                                                     |              |       
|                                     | Deferred compensation costs                                                                                                                                                |              |       
|                                     | Accumulated deficit                                                                                                                                                        |              |       
|                                     |                                                                                                                                                                            |              |       
|                                     | Total shareholders equity                                                                                                                                                 |              |       
|                                     |                                                                                                                                                                            |              |       
|                                     |                                                                                                                                                                            | $            | 91,988
|                                     |                                                                                                                                                                            |              |       
|                                     |                                                                                                                                                                            |              |       

The accompanying notes to consolidated financial statements are an integral part of these consolidated balance sheets.

45



---

##### Table of Contents

SPORTSLINE.COM, INC. AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF OPERATIONS(amounts in thousands, except share and per share data)

|                                                                                     |                                                       | Year Ended December 31, |           
|------------------------------------------------------------------------------------ | ----------------------------------------------------- | ----------------------- | ----------
|                                                                                     |                                                       |                         |           
|                                                                                     |                                                       | 2002                    |           
|                                                                                     |                                                       |                         |           
|REVENUE                                                                              |                                                       | $                       | 62,065    
|COST OF REVENUE                                                                      |                                                       |                         | 23,962    
|                                                                                     |                                                       |                         |           
|GROSS PROFIT                                                                         |                                                       |                         | 38,103    
|                                                                                     |                                                       |                         |           
|OPERATING EXPENSES:                                                                  |                                                       |                         |           
|                                                                                     | Product development                                   |                         |           
|                                                                                     | Sales and marketing:                                  |                         |           
|                                                                                     | Amortization of equity issued to Viacom for promotion |                         |           
|                                                                                     | Other                                                 |                         |           
|                                                                                     | General and administrative                            |                         |           
|                                                                                     | Depreciation and amortization                         |                         |           
|                                                                                     | Restructuring charge                                  |                         |           
|                                                                                     | Write-down of goodwill                                |                         |           
|                                                                                     |                                                       |                         |           
|                                                                                     | Total operating expenses                              |                         |           
|                                                                                     |                                                       |                         |           
|LOSS FROM OPERATIONS                                                                 |                                                       |                         | (48,907   
|INTEREST EXPENSE                                                                     |                                                       |                         | (929      
|INTEREST AND OTHER INCOME, net                                                       |                                                       |                         | 891       
|LOSS ON EQUITY INVESTMENTS                                                           |                                                       |                         |          
|GAIN ON TERMINATION OF ADVERTISING AGREEMENTS                                        |                                                       |                         |          
|GAIN ON SALE OF E-COMMERCE SUBSIDIARIES                                              |                                                       |                         |          
|GAIN ON EXTINGUISHMENT OF DEBT                                                       |                                                       |                         |          
|EFFECT OF DECONSOLIDATION OF SPORTS.COM                                              |                                                       |                         |          
|                                                                                     |                                                       |                         |           
|NET LOSS BEFORE TAX BENEFIT                                                          |                                                       |                         | (48,945   
|TAX BENEFIT                                                                          |                                                       |                         | 720       
|                                                                                     |                                                       |                         |           
|NET LOSS                                                                             |                                                       | $                       | (48,225   
|                                                                                     |                                                       |                         |           
|                                                                                     | Net loss per share  basic and diluted                |                         | $         
|                                                                                     |                                                       |                         |           
|WEIGHTED AVERAGE COMMON AND COMMON EQUIVALENT SHARES OUTSTANDING  BASIC AND
DILUTED |                                                       |                         | 37,007,281
|                                                                                     |                                                       |                         |           
|                                                                                     |                                                       |                         |           

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

46



---

##### Table of Contents

SPORTSLINE.COM, INC. AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS EQUITY(amounts in thousands, except share data)

|                                                                           |                                   |              |            |                            |   |                             |   |                    |         |   | Accumulated Other Comprehensive Income (Loss) |        |   |   |        |        |   |         
|-------------------------------------------------------------------------- | --------------------------------- | ------------ | ---------- | -------------------------- | - | --------------------------- | - | ------------------ | ------- | - | --------------------------------------------- | ------ | - | - | ------ | ------ | - | --------
|                                                                           |                                   | Common Stock |            | Additional Paid-In Capital |   | Deferred Compensation Costs |   |                    |         |   |                                              
|                                                                           |                                   |              |            |                            |   | Accumulated Deficit         |   | Comprehensive Loss |        
|                                                                           |                                   | Shares       |            | Amount                     |   |                             |   |                    |        
|                                                                           |                                   |              |            |                            |   |                             |   |                    |         |   |                                               |        |   |  
|Balances at December 31, 1999                                              |                                   |              | 25,358,788 |                            | $ | 254                         |   | $                  | 333,879 |   | $                                             |       |   | $ | 7      |        | $ | (109,484
|Exercise of CBS warrants                                                   |                                   |              | 500,000    |                            |   | 5                           |   |                    | 11,495  |   |                                               |       |   |   |       |        |   |        
|Issuance of common stock and options pursuant to acquisition of
subsidiary |                                   |              | 305,591    |                            |   | 3                           |   |                    | 15,049  |   |                                               |       |   |   |       |        |   |        
|Equity activity of subsidiary                                              |                                   |              |           |                            |   |                            |   |                    | (5,007  | ) |                                               |       |   |   |       |        |   |        
|Issuance of common stock pursuant to the employee stock purchase plan      |                                   |              | 73,883     |                            |   | 1                           |   |                    | 715     |   |                                               |       |   |   |       |        |   |        
|Net proceeds from exercise of common stock warrants                        |                                   |              | 57,000     |                            |   |                            |   |                    | 365     |   |                                               |       |   |   |       |        |   |        
|Issuance of common stock warrants                                          |                                   |              |           |                            |   |                            |   |                    | 1,567   |   |                                               |       |   |   |       |        |   |        
|Issuance of common stock from exercise of employee options                 |                                   |              | 190,931    |                            |   | 2                           |   |                    | 1,549   |   |                                               |       |   |   |       |        |   |        
|Comprehensive loss:                                                        |                                   |              |            |                            |   |                             |   |                    |         |   |                                               |        |   |   |        |        |   |         
|                                                                           | Net loss                          |              |            |                           |   |                             |  |                    |         |  |                                               |        |  |   |        |       |   |         
|                                                                           | Cumulative translation adjustment |              |            |                           |   |                             |  |                    |         |  |                                               |        |  |   |        | (5,235 | ) |         
|                                                                           |                                   |              |            |                            |   |                             |   |                    |         |   |                                               |        |   |   |        |        |   |         
|                                                                           | Comprehensive loss                |              |            |                            |   |                             |   |                    |         |   |                                               |        |   |   |        |        |   |         
|                                                                           |                                   |              |            |                            |   |                             |   |                    |         |   |                                               |        |   |   |        |        |   |         
|Balances at December 31, 2000                                              |                                   |              | 26,486,193 |                            |   | 265                         |   |                    | 359,612 |   | $                                             |       |   |   | (5,228 | )      |   | (215,552
|Repurchase of common stock                                                 |                                   |              | (2,500,500 | )                          |   | (25                         | ) |                    | (5,049  | ) |                                               |       |   |   |       |        |   |        
|Issuance of common stock and options pursuant to acquisition of
Subsidiary |                                   |              | 3,024,344  |                            |   | 30                          |   |                    | 12,103  |   |                                               |       |   |   |       |        |   |        
|Issuance of common stock pursuant to the employee stock purchase plan      |                                   |              | 176,460    |                            |   | 2                           |   |                    | 363     |   |                                               |       |   |   |       |        |   |        
|Repurchase of common stock pursuant to acquisition of subsidiary           |                                   |              | (277,152   | )                          |   | (3                          | ) |                    | (12,497 | ) |                                               |       |   |   |       |        |   |        
|Issuance of restricted shares of common stock for employees                |                                   |              | 1,909,458  |                            |   | 19                          |   |                    | 2,005   |   |                                               | (2,024 | ) |   |       |        |   |        
|Issuance of common stock pursuant to National Football League agreement    |                                   |              | 350,000    |                            |   | 3                           |   |                    | 630     |   |                                               |       |   |   |       |        |   |        
|Issuance of common stock pursuant to consulting agreement                  |                                   |              | 50,000     |                            |   | 1                           |   |                    | 266     |   |                                               |       |   |   |       |        |   |        
|Issuance of common stock from exercise of employee options                 |                                   |              | 133        |                            |   |                            |   |                    | 1       |   |                                               |       |   |   |       |        |   |        
|Amortization of deferred compensation Costs                                |                                   |              |           |                            |   |                            |   |                    |        |   |                                               | 163    |   |   |       |        |   |        
|Comprehensive loss:                                                        |                                   |              |            |                            |   |                             |   |                    |         |   |                                               |        |   |   |        |        |   |         
|                                                                           | Net loss                          |              |            |                           |   |                             |  |                    |         |  |                                               |        |  |   |        |       |   |         
|                                                                           | Cumulative translation adjustment |              |            |                           |   |                             |  |                    |         |  |                                               |        |  |   |        | 5,228  |   |         
|                                                                           |                                   |              |            |                            |   |                             |   |                    |         |   |                                               |        |   |   |        |        |   |         
|                                                                           | Comprehensive loss                |              |            |                            |   |                             |   |                    |         |   |                                               |        |   |   |        |        |   |         
|                                                                           |                                   |              |            |                            |   |                             |   |                    |         |   |                                               |        |   |   |        |        |   |         
|Balances at December 31, 2001                                              |                                   |              | 29,218,936 |                            | $ | 292                         |   | $                  | 357,434 |   | $                                             | (1,861 | ) | $ |       |        | $ | (276,698
|                                                                           |                                   |              |            |                            |   |                             |   |                    |         |   |                                               |        |   |   |        |        |   |         

(continued on next page)

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

47



---

##### Table of Contents

SPORTSLINE.COM, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS EQUITY (CONTINUED)

(amounts in thousands, except share data)

|                                                                      |                                           |              |            |                            |   |                             |                     |   |                    |   |   |      |   | Accumulated Other Comprehensive Income (Loss) |    |    |   |          |         |   |  
|--------------------------------------------------------------------- | ----------------------------------------- | ------------ | ---------- | -------------------------- | - | --------------------------- | ------------------- | - | ------------------ | - | - | ---- | - | --------------------------------------------- | -- | -- | - | -------- | ------- | - | -
|                                                                      |                                           | Common Stock |            | Additional Paid-In Capital |   | Deferred Compensation Costs |                     |   |                    |   |   |      |   |                                              
|                                                                      |                                           |              |            |                            |   |                             | Accumulated Deficit |   | Comprehensive Loss |  
|                                                                      |                                           | Shares       |            | Amount                     |   |                             |                     |   |                    |  
|                                                                      |                                           |              |            |                            |   |                             |                     |   |                    |   |   |      |   |                                               |   
|Issuance of common stock pursuant to CBS agreement                    |                                           |              | 6,882,312  |                            |   | 69                          |                     |   | 19,931             |   |   |     |   |                                               |   |    |   |         |         |   |  
|Repurchase of common stock                                            |                                           |              | (24,700    | )                          |   |                            |                     |   | (25                | ) |   |     |   |                                               |   |    |   |         |         |   |  
|Issuance of common stock pursuant to the employee stock purchase plan |                                           |              | 123,383    |                            |   | 1                           |                     |   | 105                |   |   |     |   |                                               |   |    |   |         |         |   |  
|Repurchase of restricted shares of common stock held by employees     |                                           |              | (106,398   | )                          |   | (1                          | )                   |   | (209               | ) |   |     |   |                                               |   |    |   |         |         |   |  
|Issuance of common stock pursuant to AOL agreement                    |                                           |              | 1,945,525  |                            |   | 20                          |                     |   | 1,980              |   |   |     |   |                                               |   |    |   |         |         |   |  
|Issuance of common stock pursuant to John Elway agreement             |                                           |              | 200,000    |                            |   | 2                           |                     |   | 244                |   |   |     |   |                                               |   |    |   |         |         |   |  
|Issuance of common stock warrants pursuant to consulting agreement    |                                           |              |           |                            |   |                            |                     |   | 7                  |   |   |     |   |                                               |   |    |   |         |         |   |  
|Issuance of common stock from exercise of employee options            |                                           |              | 16,966     |                            |   |                            |                     |   | 12                 |   |   |     |   |                                               |   |    |   |         |         |   |  
|Amortization of deferred compensation Costs                           |                                           |              |           |                            |   |                            |                     |   |                   |   |   | 934  |   |                                               |   |    |   |         |         |   |  
|Comprehensive loss:                                                   |                                           |              |            |                            |   |                             |                     |   |                    |   |   |      |   |                                               |    |    |   |          |         |   |  
|                                                                      | Net loss                                  |              |            |                           |   |                             |                    |   |                    |  |   |      |  |                                               |    |   |   |          | (48,225 | ) | $
|                                                                      | Unrealized gains on marketable securities |              |            |                           |   |                             |                    |   |                    |  |   |      |  |                                               |    | 23 |   |          |        |   |  
|                                                                      |                                           |              |            |                            |   |                             |                     |   |                    |   |   |      |   |                                               |    |    |   |          |         |   |  
|                                                                      | Comprehensive loss                        |              |            |                            |   |                             |                     |   |                    |   |   |      |   |                                               |    |    |   |          |         |   | $
|                                                                      |                                           |              |            |                            |   |                             |                     |   |                    |   |   |      |   |                                               |    |    |   |          |         |   |  
|Balances at December 31, 2002                                         |                                           |              | 38,256,024 |                            | $ | 383                         |                     | $ | 379,479            |   | $ | (927 | ) | $                                             | 23 |    | $ | (324,923 | )       |   |  
|                                                                      |                                           |              |            |                            |   |                             |                     |   |                    |   |   |      |   |                                               |    |    |   |          |         |   |  
|                                                                      |                                           |              |            |                            |   |                             |                     |   |                    |   |   |      |   |                                               |    |    |   |          |         |   |  

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

48



---

##### Table of Contents

SPORTSLINE.COM, INC. AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF CASH FLOWS(amounts in thousands)

|                                                     |                                                                                              | Year Ended December 31, |        
|---------------------------------------------------- | -------------------------------------------------------------------------------------------- | ----------------------- | -------
|                                                     |                                                                                              |                         |        
|                                                     |                                                                                              | 2002                    |        
|                                                     |                                                                                              |                         |        
|CASH FLOWS FROM OPERATING ACTIVITIES:                |                                                                                              |                         |        
|                                                     | Net loss                                                                                     |                         | $      
|                                                     | Adjustments to reconcile net loss to net cash used in operating activities:                  |                         |        
|                                                     | Depreciation and amortization                                                                |                         |        
|                                                     | Amortization of equity issued to Viacom for promotion                                        |                         |        
|                                                     | Amortization of equity agreements                                                            |                         |        
|                                                     | Write-down of goodwill                                                                       |                         |        
|                                                     | Bad debt and other non-cash charges                                                          |                         |        
|                                                     | Minority interest in consolidated subsidiaries                                               |                         |        
|                                                     | Loss on equity investments                                                                   |                         |        
|                                                     | Gain on termination of agreements                                                            |                         |        
|                                                     | Gain on sale of e-commerce subsidiaries                                                      |                         |        
|                                                     | Effect of deconsolidation of Sports.com                                                      |                         |        
|                                                     | Gain on extinguishment of debt                                                               |                         |        
|                                                     | Changes in operating assets and liabilities:                                                 |                         |        
|                                                     | Accounts receivable                                                                          |                         |        
|                                                     | Prepaid expenses and other assets                                                            |                         |        
|                                                     | Accounts payable                                                                             |                         |        
|                                                     | Accrued liabilities                                                                          |                         |        
|                                                     | Deferred revenue                                                                             |                         |        
|                                                     |                                                                                              |                         |        
|                                                     | Net cash used in operating activities                                                        |                         |        
|                                                     |                                                                                              |                         |        
|CASH FLOWS FROM INVESTING ACTIVITIES:                |                                                                                              |                         |        
|                                                     | Purchases of available-for-sale securities                                                   |                         |        
|                                                     | Sales of available-for-sale securities                                                       |                         |        
|                                                     | Purchase of held-to-maturity securities                                                      |                         |        
|                                                     | Proceeds from maturity of held-to-maturity securities                                        |                         |        
|                                                     | Purchases of property and equipment                                                          |                         |        
|                                                     | Sale (purchase) of licensing rights and intangible assets                                    |                         |        
|                                                     | Investment in Sports.com                                                                     |                         |        
|                                                     | Cash effect of Sports.com deconsolidation                                                    |                         |        
|                                                     | Acquisition of businesses                                                                    |                         |        
|                                                     | Proceeds from sale of investments                                                            |                         |        
|                                                     | Net decrease (increase) in restricted cash                                                   |                         |        
|                                                     |                                                                                              |                         |        
|                                                     | Net cash provided by (used in) investing activities                                          |                         |        
|                                                     |                                                                                              |                         |        
|CASH FLOWS FROM FINANCING ACTIVITIES:                |                                                                                              |                         |        
|                                                     | Proceeds from issuance of preferred stock of subsidiary                                      |                         |        
|                                                     | Net proceeds from issuance of common stock and exercise of common stock warrants and
options |                         |        
|                                                     | Repurchase of common stock pursuant to acquisition of DBC Sports                             |                         |        
|                                                     | Repurchase of restricted shares of common stock                                              |                         |        
|                                                     | Repurchase of common stock                                                                   |                         |        
|                                                     | Repurchase of convertible subordinated notes, net of costs                                   |                         |        
|                                                     | Repayment of capital lease obligations                                                       |                         |        
|                                                     |                                                                                              |                         |        
|                                                     | Net cash provided by (used in) financing activities                                          |                         |        
|                                                     |                                                                                              |                         |        
|                                                     | Effect of exchange rate changes on cash                                                      |                         |        
|                                                     |                                                                                              |                         |        
|Net increase (decrease) in cash and cash equivalents |                                                                                              |                         | (12,939
|CASH AND CASH EQUIVALENTS, beginning of period       |                                                                                              |                         | 30,322 
|                                                     |                                                                                              |                         |        
|CASH AND CASH EQUIVALENTS, end of period             |                                                                                              | $                       | 17,383 
|                                                     |                                                                                              |                         |        
|                                                     |                                                                                              |                         |        

(continued on next page)

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

49



---

##### Table of Contents

SPORTSLINE.COM, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)(amounts in thousands)

|                                                          |                                                                                      | Year Ended December 31, |  
|--------------------------------------------------------- | ------------------------------------------------------------------------------------ | ----------------------- | -
|                                                          |                                                                                      |                         |  
|                                                          |                                                                                      | 2002                    |  
|                                                          |                                                                                      |                         |  
|SUPPLEMENTAL NON-CASH INVESTING AND FINANCING ACTIVITIES: |                                                                                      |                         |  
|                                                          | Sale of e-commerce subsidiaries                                                      |                         | $
|                                                          |                                                                                      |                         |  
|                                                          | Investments in businesses                                                            |                         | $
|                                                          |                                                                                      |                         |  
|                                                          | Equity activity of subsidiary                                                        |                         | $
|                                                          |                                                                                      |                         |  
|                                                          | Issuance of common stock pursuant to the CBS agreement                               |                         | $
|                                                          |                                                                                      |                         |  
|                                                          | Issuance of common stock pursuant to the AOL agreement                               |                         | $
|                                                          |                                                                                      |                         |  
|                                                          | Issuance of common stock pursuant to the NFL agreement                               |                         | $
|                                                          |                                                                                      |                         |  
|                                                          | Issuance of common stock pursuant to acquisition of subsidiaries                     |                         | $
|                                                          |                                                                                      |                         |  
|                                                          | Issuance of restricted shares to employees                                           |                         | $
|                                                          |                                                                                      |                         |  
|                                                          | Issuance of common stock and common stock warrants pursuant to consulting agreements |                         | $
|                                                          |                                                                                      |                         |  
|SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:         |                                                                                      |                         |  
|                                                          | Cash paid for interest                                                               |                         | $
|                                                          |                                                                                      |                         |  
|                                                          | Cash paid (refund received) for income taxes                                         |                         | $
|                                                          |                                                                                      |                         |  

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

50



---

##### Table of Contents

SPORTSLINE.COM, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS December 31, 2002(amounts in thousands, except share and per share data)

(1)     NATURE
OF OPERATIONS:

SportsLine.com, Inc. (SportsLine.com or the Company) was incorporated on February 23, 1994
and began recognizing revenue from its operations in September 1995.  SportsLine.com publishes one of the most comprehensive collections of multimedia sports news and information available on the Internet and offers consumers a broad assortment
of merchandise and subscription and premium services, including fantasy leagues and contests. The Companys flagship Internet sports service (http://cbs.sportsline.com) was renamed CBS SportsLine.com in March 1997 as part of an exclusive
promotional and content agreement with CBS Broadcasting Inc. (CBS). The Company has strategic relationships with CBS, Westwood One, the National Football League (the NFL), the National Collegiate Athletic Association (the
NCAA) and the PGA TOUR and serves as the primary sports content provider for America Online, Inc. (AOL).  The Company distributes a broad range of up-to-date news, scores, player and team statistics and standings, photos
and audio and video clips obtained from CBS and other leading sports news organizations; produces and offers fantasy league products, contests and other games; and produces and distributes entertaining, interactive and original programming such as
editorials and analyses from its in-house staff and freelance journalists.

(2)     SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

Principles of Consolidation

The consolidated
financial statements include the accounts of SportsLine.com and its majority owned subsidiaries.  All significant intercompany balances and transactions have been eliminated in consolidation.

Use of Estimates

The preparation of financial
statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and
liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period.  Actual results could differ from those estimates.

Reclassifications

Certain prior year amounts
have been reclassified to conform to the current year presentation.

Cash and Cash Equivalents

The Company considers all highly liquid cash investments with original maturities of three months or less to be cash equivalents.

Marketable Securities

The Company invests in certain
marketable debt securities, which consist primarily of high-quality short-to long-term fixed income securities that are classified as available-for-sale and held-to-maturity securities.  Such investments are included in Marketable
securities and Noncurrent marketable securities on the accompanying consolidated balance sheets.  The securities that are classified as available-for-sale are reported at fair value with unrealized gains and losses included in
Accumulated other comprehensive income.  The specific identification method is used to determine the cost of securities.  The marketable securities that are classified as held-to-maturity are carried at amortized cost, which
approximates market value at December 31, 2002 and 2001.

51



---

##### Table of Contents

SPORTSLINE.COM, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)(amounts in thousands, except share and per
share data)

(2)     SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:(Continued)

Deferred Advertising and Content Costs

Deferred advertising and content costs relate to unamortized costs of equity instruments issued under the CBS Agreement discussed in Note 8.  Such costs are
capitalized as the equity instruments are issued.  These costs are then charged to operations as the Company receives promotion and other benefits under the agreement.

Long-Lived Assets

Long-lived assets, other
than goodwill, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets might not be recoverable.  The Company does not perform a periodic assessment of assets for impairment in the
absence of such information or indicators.  Conditions that would necessitate an impairment assessment include a significant decline in the observable market value of an asset, or a significant adverse change that would indicate that the
carrying amount of an asset or group of assets is not recoverable.  For long-lived assets to be held and used, the Company recognizes an impairment loss only if its carrying amount is not recoverable through its undiscounted cash flows and
measures the impairment loss based on the difference between the carrying amount and fair value.

Property and
Equipment

Property and equipment is carried at historical cost and is being depreciated and amortized using the straight-line method
over the shorter of the estimated useful life of the asset or the lease period.

Maintenance and repairs are charged to expense when
incurred; betterments are capitalized.    Upon the sale or retirement of assets, the cost and accumulated depreciation and amortization are removed from the accounts and any gain or loss is recognized.

Goodwill

In July 2001, the Financial
Accounting Standards Board (FASB) issued Statement of Financial Accounting Standard (SFAS) No. 142, Goodwill and Other Intangible Assets.  SFAS No. 142 addresses financial accounting and reporting for intangible
assets acquired individually or with a group of other assets (but not acquired in a business combination) at acquisition.  SFAS No. 142 also addresses financial accounting and reporting for goodwill and other intangible assets subsequent to
acquisition.  With the adoption of SFAS No. 142, goodwill is no longer subject to amortization.  Rather, goodwill is subject to at least an annual assessment for impairment by applying a fair value-based test, with the initial test
required by June 30, 2002.  SFAS No. 142 prescribes a two-phase process for impairment testing of goodwill.  The first phase of the test is designed to identify potential impairment; while the second phase (if necessary), measures the
impairment.  The impairment loss is the amount, if any, by which the implied fair value of goodwill is less than the book carrying value.  SFAS No. 142 was effective for fiscal years beginning after December 15, 2001.  The Company
adopted SFAS No. 142 as of January 1, 2002, and its first phase impairment analysis, completed by the Company in May 2002, found no instances of impairment of its recorded goodwill; accordingly, the second testing phase was not necessary.  The
Company has performed the annual impairment test required under SFAS No. 142 to test impairment as of October 1, 2002.  See Note 4.

52



---

##### Table of Contents

SPORTSLINE.COM, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)(amounts in thousands, except share and per
share data)

(2)     SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:(Continued)

In accordance with Accounting Principles Board (APB) Opinion No. 20, Accounting Changes, the effect of this accounting change is reflected
prospectively.  Supplemental comparative disclosure, as if the change had been retroactively applied, is as follows:

|                                  |                                               | For the years ended December 31, |  
|--------------------------------- | --------------------------------------------- | -------------------------------- | -
|                                  |                                               |                                  |  
|                                  |                                               | 2002                             |  
|                                  |                                               |                                  |  
|Net loss:                         |                                               |                                  |  
|                                  | Reported net loss                             |                                  | $
|                                  | Goodwill amortization                         |                                  |  
|                                  |                                               |                                  |  
|                                  | Adjusted net loss                             |                                  | $
|                                  |                                               |                                  |  
|Basic and diluted loss per share: |                                               |                                  |  
|                                  | Reported loss per share                       |                                  | $
|                                  | Goodwill amortization                         |                                  |  
|                                  |                                               |                                  |  
|                                  | Adjusted basic and diluted net loss per share |                                  | $
|                                  |                                               |                                  |  

Other Assets

Licensing and Consulting Agreements.The cost of licensing and consulting agreements, which is primarily a result of issuances of warrants
to purchase common stock, is being amortized using the straight-line method over the term of the related agreements (from one to ten years) beginning in August 1995, when cbs.sportsline.com first became commercially available.  Such costs
totaled approximately $3,515 and $16,704 at December 31, 2002 and 2001, respectively.  Accumulated amortization on such amounts was approximately $3,006 and $11,541 at December 31, 2002 and 2001, respectively.  These amounts are reflected
in other assets in the accompanying consolidated balance sheets.  Amortization expense under these agreements was approximately $1,658, $4,662 and $5,689 for the years ended December 31, 2002, 2001 and 2000, respectively, and is included in
depreciation and amortization expense in the accompanying consolidated statements of operations.

Intangible Assets.In
January 2001, the Company acquired for a cost of $6,000 certain assets of MVP.com, Inc. (MVP), which had ceased business operations, including the domain names, trademarks and certain other assets associated with the Web sites mvp.com,
planetoutdoors.com, igogolf.com, golfclubtrader.com and tennisdirect.com.  The cost of these assets is being amortized using the straight-line method over five years.  Accumulated amortization was $2,400 at December 31, 2002. 
Amortization expense was approximately $1,200 for the year ended December 31, 2002 and is included in depreciation and amortization expense in the accompanying consolidated statements of operations.  Assuming there is no impairment of the
asset, future amortization expense will be $1,200 in each of the next three years.

53



---

##### Table of Contents

SPORTSLINE.COM, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)(amounts in thousands, except share and per
share data)

(2)     SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:(Continued)

Accrued Liabilities

Accrued liabilities
consists of the following:

|                  |  | December 31, |      
|----------------- |  | ------------ | -----
|                  |  |              |      
|                  |  | 2002         |      
|                  |  |              |      
|Revenue sharing   |  | $            | 3,084
|Payroll           |  |              | 2,603
|Health insurance  |  |              | 503  
|Cash prizes       |  |              | 475  
|Advertising       |  |              | 330  
|Professional fees |  |              | 282  
|Other             |  |              | 1,939
|                  |  |              |      
|                  |  | $            | 9,216
|                  |  |              |      

Revenue
Recognition

Revenue recognition policies for advertising and marketing services, subscription and premium products, content
licensing, international revenue and barter transactions are set forth below.

Revenue by Type

Revenue by type for the years ended December 31, 2002, 2001 and 2000 was as follows:

|                                   |  | Year Ended December 31, |       
|---------------------------------- |  | ----------------------- | ------
|                                   |  |                         |       
|                                   |  | 2002                    |       
|                                   |  |                         |       
|Advertising and marketing services |  | $                       | 47,816
|Subscription and premium products  |  |                         | 14,249
|Content licensing and other        |  |                         |      
|                                   |  |                         |       
|                                   |  | $                       | 62,065
|                                   |  |                         |       

Advertising and Marketing
Services Revenue

Advertising and marketing services revenue encompass advertising and sponsorship sales as well as the
Companys revenue from its direct marketing services and promotion of e-commerce Web sites such as MVP.com and the NFL.com shop. Revenue is primarily derived from the sale of advertising on the Companys Web sites as well as the sale of
advertising on Web sites operated by the Company.  Advertising includes, among other forms, banner advertisements and sponsorships.  Advertising and marketing services revenue is recognized in the period the advertisement is displayed or
services rendered, provided that no significant Company obligations remain and collection of the resulting receivable is probable.  Company obligations typically include guarantees of a minimum number of impressions, or times that
an advertisement is viewed by users of the Companys Web sites. Amounts received or billed for which impressions have not yet been delivered are reflected as deferred revenue in the accompanying consolidated balance sheets. The Company derives
marketing services revenue from third party Web sites it promotes, hosts, or produces.

54



---

##### Table of Contents

SPORTSLINE.COM, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)(amounts in thousands, except share and per
share data)

(2)     SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:(Continued)

Subscription and Premium Products Revenue

Subscription and premium products revenue includes paid memberships, fee-based fantasy products and premium Vegas Insider services.  The Company offers fee-based
fantasy products for football, baseball, basketball and hockey.  These fantasy products allow members to form their own team by assembling a group of athletes from a sport and following their performance on a weekly or daily basis.  These
fantasy teams can then compete in contests administered by the Company for cash or merchandise prizes or compete in leagues administered by the users on the Companys Web site.  The Company also offers a program, SportsLine
Rewards, at no charge that offers bonus points to members for viewing pages and making purchases.  These points can be redeemed for discounts on merchandise, special events and other premium items. For a fee, the Company offers
SportsLine Rewards Plus where members are also eligible to participate in sports contests to win cash prizes and merchandise.

Revenue relating to monthly memberships is recognized in the month the service is provided.  Revenue relating to yearly memberships and sports contests is
recognized ratably over the life of the membership agreement or contest period.  Revenue related to fantasy products is recognized over the applicable professional sports season, generally four to six months, over which the product is
serviced.  Accordingly, amounts received for which services have not yet been provided are reflected as deferred revenue in the accompanying consolidated balance sheets.

Content Licensing Revenue

Content licensing
revenue is derived from the licensing of certain of the Companys content to third parties.  Content licensing revenue is recognized over the period of the license agreement as the Company delivers content.  The Company did not have
any content licensing revenue in 2002 and does not expect to have any such revenue in the future, unless the Company enters into new content licensing agreements.

Barter and Equity Transactions

The Company
recognizes advertising and content licensing revenue as a result of barter transactions.  Such revenue is recognized based on the fair value of the consideration received, which generally consists of advertising displayed on the other
companies Web sites.  Barter revenue and the corresponding expense are recognized in the period the advertising is displayed.

Barter transactions, in which the Company received advertising or other services or goods in exchange for content or advertising on its Web sites, accounted for
approximately 8%, 20% and 17% of total revenue for the years ended December 31, 2002, 2001 and 2000, respectively.  Barter transactions are recorded based upon, and to the extent of, similar recent cash transactions of the Company pursuant to
Emerging Issues Task Force (EITF) Issue No. 99-17, Accounting for Advertising Barter Transactions.  During 2002, the Company delivered approximately 25.4 million impressions under barter arrangements where fair market value
was not determinable under EITF 99-17 and, accordingly, revenue was not recognized.  While the Company may enter into barter arrangements from time to time, the Company does not expect to recognize barter advertising revenue, along with the
offsetting marketing expense, in future periods.

Equity transactions, in which the Company received equity in companies in
exchange for advertising and promotion accounted for approximately 0%, 5% and 16% of total revenue for the years ended December 31, 2002, 2001 and 2000, respectively.  As discussed in Note 4, the majority of equity-related revenue was derived
from two agreements, both of which were terminated prior to December 31, 2000.  An additional agreement that provided for equity-related revenue was terminated in June 2001.  The Company does not expect to have any equity related revenue
in future periods, unless the Company enters into new agreements.

55



---

##### Table of Contents

SPORTSLINE.COM, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)(amounts in thousands, except share and per
share data)

(2)     SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:(Continued)

Cost of Revenue

Cost of revenue consists
primarily of content and royalty fees, revenue sharing, and payroll and related expenses for the editorial and operations staff.  Telecommunications, Internet access and computer related expenses for the support and delivery of the
Companys services are also included in cost of revenue.

Amortization of Equity Issued to Viacom

Amortization of equity issued to Viacom for promotion consists of the amortization expense for the Companys agreements with two Viacom-related entities
pursuant to which the Company issued equity instruments in exchange for advertising and promotion.

Sales and Marketing -
Other

Sales and marketing - other expense consists of salaries and related expenses, advertising, marketing, promotional, business
development, public relations expenses and member acquisition costs.  Member acquisition costs consist primarily of the direct costs of member solicitation, including advertising on other Web sites and Internet search engines and the cost of
obtaining qualified prospects from direct marketing programs and third parties.  No indirect costs are included in member acquisition costs.  In accordance with American Institute of Certified Public Accountants (AICPA)
Statement of Position (SOP), 93-7, Reporting on Advertising Costs,the Company may, in the future, capitalize such direct-response advertising costs if historical evidence is available to indicate that the advertising results in a
future benefit.  Until that time, all such costs are expensed as incurred.  All other advertising and marketing costs are charged to expense at the time the advertising takes place.  Cash advertising expense for 2002, 2001 and 2000
was $540, $7,035 and $16,217, respectively.

Per Share Amounts

Loss per share is computed using the weighted average number of common and dilutive common equivalent shares outstanding during the period. Common equivalent shares
consist of the incremental common shares issuable upon conversion of the Companys Convertible Subordinated Notes due 2006 (Convertible Subordinated Notes) (using the if-converted method) and shares issuable upon exercise of stock
options and warrants (using the treasury stock method).

There were 256,091 shares issuable upon conversion of the Convertible
Subordinated Notes at December 31, 2002 and 2001, respectively, and 301,080 shares issuable upon conversion at December 31, 2000, and there were 4,763,000, 4,346,000 and9,685,000 options and warrants outstanding in the aggregate at December 31,
2002, 2001 and 2000, respectively, that could potentially dilute earnings per share in the future.  Such shares issuable upon conversion of the Convertible Subordinated Notes and upon exercise of the options and warrants were not included in
the computation of diluted net loss per share as they were antidilutive for all periods presented.

Fair Value of Financial
Instruments

The Companys financial instruments, primarily consisting of cash and cash equivalents, marketable securities,
accounts receivable and accounts payable, approximate fair value due to their short-term nature and/or market rates of interest.  Additionally, the Company believes that the fair value of the Convertible Subordinated Notes at December 31, 2002
and 2001 was significantly below the principal amount of $16,678; however, it is not practicable to estimate their fair value as there is no market for the Convertible Subordinated Notes and the entire outstanding principal amount is held by one
entity.

56



---

##### Table of Contents

SPORTSLINE.COM, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)(amounts in thousands, except share and per
share data)

(2)     SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:(Continued)

Concentration of Credit Risk

Financial
instruments that potentially subject the Company to significant concentrations of credit risk consist primarily of cash and cash equivalents, marketable securities and accounts receivable.  The Companys cash management and investment
policies restrict investments to low risk, highly-liquid securities, and the Company performs periodic evaluations of the credit standing of the financial institutions with which it deals.  Accounts receivable from customers outside the United
States at December 31, 2002 were not significant.  The Company performs ongoing credit evaluations and maintains an allowance for doubtful accounts for accounts which management believes may have become impaired and, to date, losses have not
been significant.  The allowance for doubtful accounts was $887 and $1,031 at December 31, 2002 and 2001, respectively, and activity for the years ended December 31, 2002, 2001 and 2000 was as follows:

|                                |  | 2002 |       | 2001 |   | 2000   |  
|------------------------------- |  | ---- | ----- | ---- | - | ------ | -
|                                |  |      |       |      |   |        |  
|January 1 balance               |  | $    | 1,031 |      | $ | 1,765  |  
|Provision for doubtful accounts |  |      | 162   |      |   | 926    |  
|Write-offs                      |  |      | (306  | )    |   | (1,439 | )
|Sports.com deconsolidation      |  |      |      |      |   | (221   | )
|                                |  |      |       |      |   |        |  
|December 31 balance             |  | $    | 887   |      | $ | 1,031  |  
|                                |  |      |       |      |   |        |  

Stock-Based
Compensation

SFAS No. 123, Accounting for Stock-Based Compensation allows either adoption of a fair value based method of
accounting for employee stock options and similar equity instruments or continuation of the measurement of compensation cost relating to such plans using the intrinsic value method of accounting prescribed by APB Opinion No. 25, Accounting for
Stock Issued to Employees.The Company has elected to use the intrinsic value method.

Pro forma information is required
by SFAS No. 123 and has been determined as if the Company had accounted for its stock-based compensation plans under the fair value method.  The fair value of each option grant was estimated at the date of grant using the Black-Scholes option
pricing model with the following weighted average assumptions used for grants in 2002, 2001 and 2000, respectively: risk-free interest rates of 2.3% to 4.2%, 1.3% to 5.5% and 5.2% to 6.7%; dividend yield of 0% for all years; expected volatility
factor of 90% for 2002 and 100% for 2001 and 2000; and expected life of 4.39 years for all years.  The weighted average fair value of options granted during 2002, 2001 and 2000 was $1.26, $1.93, and $12.45, respectively.

The Companys pro forma information follows for the years ended December 31:

|                                                                                       |  | 2002 |         | 2001 |   | 2000    |  
|-------------------------------------------------------------------------------------- |  | ---- | ------- | ---- | - | ------- | -
|                                                                                       |  |      |         |      |   |         |  
|Net loss  as reported                                                                 |  | $    | (48,225 | )    | $ | (61,146 | )
|Total stock-based compensation determined under fair value based method for all awards |  |      | (5,745  | )    |   | (25,896 | )
|                                                                                       |  |      |         |      |   |         |  
|Pro forma net loss                                                                     |  | $    | (53,970 | )    | $ | (87,042 | )
|                                                                                       |  |      |         |      |   |         |  
|Net loss per share basic and diluted  as reported                                     |  | $    | (1.30   | )    | $ | (2.23   | )
|                                                                                       |  |      |         |      |   |         |  
|Net loss per share basic and diluted  pro forma                                       |  | $    | (1.46   | )    | $ | (3.17   | )
|                                                                                       |  |      |         |      |   |         |  

57



---

##### Table of Contents

SPORTSLINE.COM, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)(amounts in thousands, except share and per
share data)

(2)     SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:(Continued)

Restricted stock is measured at fair value on the date of grant based on the number of shares granted and the quoted price of the Companys common stock. 
Such value is recognized as an expense ratably over the corresponding vesting period.  Stock based compensation associated with the issuance of restricted stock was $934, $163 and $0 during 2002, 2001 and 2000, respectively.

Segment Reporting

Based on the
criteria set forth in SFAS No. 131, Disclosures about Segments of an Enterprise and Related Information, the Company operates in one principal business segment as of December 31, 2002.  For the year ended December 31, 2000 and through
July 17, 2001, the Company operated in two principal business segments that shared the same infrastructure:  United States and international through the Companys former subsidiary, Sports.com Limited.  See Note 4.

Comprehensive Income (Loss)

SFAS No. 130,Reporting Comprehensive Income, establishes standards for the reporting and display of comprehensive income (loss) and its components in a full
set of financial statements.  The objective of SFAS No. 130 is to report comprehensive income (loss), a measure of all changes in equity of an enterprise that result from transactions and other economic events in a period, other than
transactions with owners.  The Company has elected to disclose comprehensive income (loss) in the consolidated statements of changes in shareholders equity.

Restructuring Charge

In April 2001, the
Company began implementing several cost-saving initiatives, which continued into 2002. Cost reductions were accomplished through a variety of steps, most significantly in the areas of discretionary marketing and a substantial reduction in the
Companys domestic workforce.       Severance and rent payments relating to this initial cost restructuring plan were approximately $143 for the year ended December 31, 2002, with a remaining accrual balance at
December 31, 2002 of $40.

In April 2002, the Company announced the resignation of its chief technology officer and the expansion of
responsibilities of its president of product development.  As part of this change in personnel, the Company further integrated its fantasy sports operations into its other operations and technology departments. In August 2002, the Company
announced the resignation of its president of corporate and business development and integrated its business development and legal affairs departments into the sales and finance departments, respectively.  As a result of these resignations and
organizational changes, the Company eliminated approximately twenty-seven redundant positions.  Severance payments relating to these actions during the year ended December 31, 2002 were $1,236, with a remaining accrual balance as of December
31, 2002 of $1,166.

Internal Use Software and Web Site Development Costs

SOP 98-1, Accounting for the Costs of Computer Software Developed or Obtained for Internal Use, establishes criteria for determining which costs of developing
or obtaining internal-use computersoftware should be charged to expense and which should be capitalized.  To date, the Company has not capitalized any such costs.

EITF Issue 00-2, Accounting for Web Site Development Costs, provides guidance on what types of costs incurred to develop Web sites should be capitalized or
expensed.  To date, the Company has not capitalized any such costs.

58



---

##### Table of Contents

SPORTSLINE.COM, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)(amounts in thousands, except share and per
share data)

(2)     SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:(Continued)

Recent Accounting Pronouncements

In October
2001, the FASB issued SFAS No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets, which is applicable to financial statements issued for fiscal years beginning after December 15, 2001. The FASBs new rules on asset
impairment supercede SFAS No. 121, Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to Be Disposed Of, and portions of APB Opinion No. 30, Reporting the Results of Operations. SFAS No. 144 provides a single
accounting model for long-lived assets to be disposed of and significantly changes the criteria that would have to be met to classify an asset as held-for-sale. Classification as held-for-sale is an important distinction since such assets are not
depreciated and are stated at the lower of fair value or carrying amount. SFAS No. 144 also requires expected future operating losses from discontinued operations to be displayed in the period(s) in which the losses are incurred, rather than as of
the measurement date as presently required. The adoption of SFAS No. 144 on January 1, 2002 did not have a material impact on the Companys consolidated financial statements.

In April 2002, the FASB issued SFAS No. 145, Rescission of FASB Statements No. 4, 44, and 62, Amendment of FASB Statement No. 13, and Technical Corrections,which is generally applicable to financial statements for fiscal years beginning after May 15, 2002; however, early adoption is encouraged.  SFAS No. 145 eliminates the requirement under SFAS No. 4, Reporting Gains and Losses from
Extinguishment of Debtto report gains and losses from extinguishments of debt as extraordinary items in the income statement.  The Company adopted SFAS No. 145 on July 1, 2002, and accordingly reclassified the extraordinary gain of $2,404,
which occurred from its extinguishment of debt in 2001.

In June 2002, the FASB issued SFAS No. 146, Accounting for Costs Associated
with Exit or Disposal Activities,which is applicable to financial statements for fiscal years beginning after December 31, 2002; however early adoption is encouraged.  SFAS No. 146 requires that a liability for a cost associated with an
exit or disposal activity be recognized and measured initially at fair value only when the liability is incurred.  The Company adopted SFAS No. 146 on July 1, 2002, and it did not have a material impact on the Companys consolidated
financial statements.

In November 2002, the EITF reached a consensus on Issue 00-21, addressing how to account for arrangements that
involve the delivery or performance of multiple products, services, and/or rights to use assets.  Revenue arrangements with multiple deliverables are divided into separate units of accounting if the deliverables in the arrangement meet the
following criteria: (1) the delivered item has value to the customer on a stand-alone basis; (2) there is objective and reliable evidence of the fair value of undelivered items; and (3) delivery of any undelivered item is probable.  Arrangement
consideration should be allocated among the separate units of accounting based on their relative fair values, with the amount allocated to the delivered item being limited to the amount that is not contingent on the delivery of additional items or
meeting other specified performance conditions.  The final consensus will be applicable to agreements entered into in fiscal periods beginning after June 15, 2003 with early adoption permitted.  The provisions of this consensus are not
expected to have a significant effect on the Companys financial position or operating results.

In December 2002, the FASB issued
SFAS No. 148 Accounting for Stock-Based Compensation  Transition and Disclosure. This statement amends SFAS No. 123 Stock-Based Compensation, to provide alternative methods of transition for a voluntary
change to the fair value based method of accounting for stock based employee compensation.  In addition, this statement amends the disclosure requirements of SFAS No. 123 to require prominent disclosures in both annual and interim
financial statements about the method used on reported results.  The disclosure provisions of this standard are effective for fiscal years ending after December 15, 2002 and have been incorporated in these financial statements and accompanying
footnotes.

59



---

##### Table of Contents

SPORTSLINE.COM, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS December 31, 2002(amounts in thousands, except share and per
share data)

(3)     CASH, CASH EQUIVALENTS AND MARKETABLE SECURITIES:

The following tables summarize, by major security type, the Companys cash and cash equivalents and marketable securities as of December 31, 2002:

|                           |                                    | Cost or Amortized Cost |        | Gross Unrealized Gains |  | Gross Unrealized Losses |    | Estimated Fair Value |  
|-------------------------- | ---------------------------------- | ---------------------- | ------ | ---------------------- |  | ----------------------- | -- | -------------------- | -
|                           |                                    |                        |        |                        |  |                         |    |                      |  
|Cash and Cash Equivalents: |                                    |                        |        |                        |  |                         |    |                      |  
|                           | Cash                               |                        | $      | 8,279                  |  |                         |   |                      |  
|                           | Agency securities                  |                        |        | 9,104                  |  |                         |   |                      |  
|                           |                                    |                        |        |                        |  |                         |    |                      |  
|Cash and Cash Equivalents  |                                    |                        | 17,383 |                        |  |                        |    |                      | 
|Available-for-Sale:        |                                    |                        |        |                        |  |                         |    |                      |  
|                           | Corporate notes and bonds          |                        |        | 2,599                  |  |                         | 23 |                      |  
|                           | Asset-backed and agency securities |                        |        | 11,746                 |  |                         | 31 |                      |  
|Held-to-Maturity:          |                                    |                        |        |                        |  |                         |    |                      |  
|                           | Corporate notes and bonds          |                        |        | 1,067                  |  |                         |   |                      |  
|                           | Asset-backed and agency securities |                        |        | 4,807                  |  |                         | 10 |                      |  
|                           |                                    |                        |        |                        |  |                         |    |                      |  
|                           | Marketable securities              |                        |        | 20,219                 |  |                         | 64 |                      |  
|                           |                                    |                        |        |                        |  |                         |    |                      |  
|                           | Total                              |                        | $      | 37,602                 |  | $                       | 64 |                      | $
|                           |                                    |                        |        |                        |  |                         |    |                      |  
|                           |                                    |                        |        |                        |  |                         |    |                      |  

The following table summarizes contractual maturities of the Companys marketable securities as of December
31, 2002:

|                                                           |  | Amortized Cost |        | Estimated Fair Value |  
|---------------------------------------------------------- |  | -------------- | ------ | -------------------- | -
|                                                           |  |                |        |                      |  
|Due within one year                                        |  | $              | 3,863  |                      | $
|Asset-backed and agency securities with various maturities |  |                | 16,356 |                      |  
|                                                           |  |                |        |                      |  
|                                                           |  | $              | 20,219 |                      | $
|                                                           |  |                |        |                      |  

The Company realized an immaterial
gain on the sale of an available-for-sale security in 2002.  The Company classified all of its marketable securities as held-to-maturity as of December 31, 2001.

(4)     ACQUISITIONS AND DISPOSITIONS:

The Company acquired International Golf
Outlet, Inc. (IGO) in June 1998 and TennisDirect.com, Inc. in August 1999, and accounted for these transactions using the purchase method of accounting.  The purchases resulted in goodwill of $3,180. Such goodwill was being
amortized over an estimated life of ten years. In May 1999, the Company acquired Golf Club Trader, Inc. The purchase was accounted for using the pooling-of-interests method of accounting.  As of January 2000, the aforementioned companies were
sold to MVP.com, Inc. (MVP) in exchange for an equity interest in MVP resulting in a one-time gain of $7,814.  In addition, the Company entered into a 10-year strategic e-commerce and marketing agreement with MVP pursuant to which
MVP operated the Companys domestic e-commerce business.  These transactions with MVP resulted in the Company receiving an investment in MVP totaling $100,000.  Such investment was initially recorded at estimated fair value.During the third and fourth quarters of 2000, the Company deemed its investment in MVP to be permanently impaired and wrote off the entire investment of $100,000, which is included in loss on equity investments.  The Companys estimate
was based on the market downturn during the third and fourth quarters of 2000, which caused similar declines in publicly-traded Internet e-commerce companies market values, the difficulty experienced by MVP in raising additional capital and
an

60



---

##### Table of Contents

SPORTSLINE.COM, INC. AND SUBSIDIARIES UNAUDITED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (amounts in thousands except share and per share
data) (Continued)

(4)     ACQUISITIONS AND DISPOSITIONS:(Continued)

assessment of MVPs
financial condition and prospects.  In November 2000, the Company terminated its marketing agreement with MVP due to MVPs breach of the agreement.  As a result of the termination, in 2000 the Company reversed deferred revenue of
$72,303, net of taxes, which is included in gain on termination of advertising agreements in the accompanying consolidated statements of operations.  In 2001, the Company recognized an additional gain of $2,051 resulting from the reversal of an
accrual related to the termination of the MVP.com agreement.

Additionally, as of December 29, 2000, Internet Sports Network ceased
operations.  As a result, the Company wrote off its investment of $15,247, included in loss on equity investments, during the fourth quarter of 2000, which the Company had received as part of the promotional and advertising agreement. 
Furthermore, several of the Companys other equity investments were adversely affected by the market downturn and were written down by $12,406, included in loss on equity investments, in the third and fourth quarters of 2000.  As of
December 31, 2002, the Company had an equity investment in one company totaling $500, the value of which is guaranteed by a cash escrow account.

Sports.com Limited (Sports.com) was formed in May 1999.  As of December 31, 2000, SportsLine owned 71% of the common shares of Sports.com.  In
2000, the Company consolidated between 71% and 100% of the losses of Sports.com, which has historically been offset by the allocation of a portion of such losses to third party holders of Sports.com common stock.  On July 17, 2001, Sports.com
raised approximately $13,000 in equity funding from its existing investors. After giving effect to the funding, the Companys fully diluted ownership stake in Sports.com, including all outstanding warrants and management options, was
approximately 30%. As a result of the Companys reduced ownership interest in Sports.com and a reduction in the Companys representation on Sports.coms board of directors to less than a majority, as of July 17, 2001 the Company was
no longer consolidating the results of Sports.com and accounted for its investment in Sports.com under the equity method of accounting.  In accordance with United States generally accepted accounting principles, the Company recorded the effect
of the deconsolidation of the subsidiary in the amount of $41,739 in 2001. After July 17, 2001, the Company no longer recorded any losses generated by Sports.com as its investment had been reduced to zero and the Company had no future obligation to
provide funding to Sports.com.  On May 31, 2002, Sports.com was placed into administration, a procedure in the U.K. pursuant to which a court-appointed administrator assumes day-to-day control of a company in order to determine whether a
business should be reorganized, sold or liquidated, and in July 2002 the Companys inter-company agreement with Sports.com was terminated.

The Company acquired Daedalus World Wide Corporation (DWWC) in December 1999.  The transaction was accounted for using the purchase method of
accounting.  The purchase resulted in goodwill of $31,880, which was being amortized over an estimated life of seven years.  In the fourth quarter of 2000, a $12,000 liability, included in accounts payable at December 31, 2000, was
recorded pursuant to the purchase agreement, which provided for additional consideration in exchange for meeting certain performance thresholds.  During the first quarter of 2001, 828,376 shares of common stock were issued in satisfaction of
$6,000 of the liability, and during the fourth quarter of 2001, 2,195,968 shares of common stock were issued in satisfaction of the remaining $6,000 liability.  In addition, the Company recognized a goodwill write-down in the year ended
December 31, 2001 of $17,000 to adjust its investment in DWWC to its estimated fair value. The Companys assessment of its goodwill investment was based on historical operations, undiscounted future cash flows and the market value of similar
entities.  The Company performed the annual impairment test required under SFAS No. 142 to test impairment as of October 1, 2002.  As a result, the Company found no impairment of its goodwill.  At December 31, 2002, the Company had
goodwill of $16,194 recorded for DWWC.

In April 2000, the Company, through its wholly-owned subsidiary VegasInsider.com, Inc., purchased
the DBC Sports division of Data Broadcasting Corporation (DBC) in exchange for 277,152 shares of the Companys common stock (the Consideration Shares).  Pursuant to the terms of the purchase agreement, the Company
guaranteed that the Consideration Shares would have a value equal to or greater than $12,500 on March 31, 2001 (the Guaranteed Proceeds).  On April 6, 2001, due to the decline in the trading price of the Companys common stock,
the Company fulfilled its obligation to DBC by purchasing the Consideration Shares for $12,500. The Consideration

61



---

##### Table of Contents

SPORTSLINE.COM, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)(amounts in thousands, except share and per
share data)

(4)     ACQUISITIONS AND DISPOSITIONS:(Continued)

Shares were cancelled and retired in April
2001.  DBC Sports originates and sells odds and other statistical data to certain Las Vegas casinos. The Company recorded a goodwill write-down of $4,600 in 2001 to reflect a reduction in the estimated value of its investment in DBC
Sports.  The assessmentof goodwill was based on historical operating results, undiscounted future cash flows and the market values of similar entities.  The Company performed the annual impairment test required under SFAS No. 142 to test
impairment as of October 1, 2002.  As a result, the Company recorded a goodwill write-down of $2,650 to adjust the value of its investment in DBC Sports to its estimated fair value.  At December 31, 2002, the Company had goodwill of $2,017
recorded for DBC Sports.

The Company acquired another business during 1999 and accounted for the transaction using the purchase method
of accounting.  The purchase resulted in goodwill of $3,726, which was being amortized over an estimated life of seven years.  The business was subsequently sold in April 2000 resulting in a gain of $264.

The following unaudited pro forma financial information presents the consolidated operations of the Company along with the acquired and disposed of companies as if
the transactions had occurred at the beginning of the periods presented, after giving effect to certain adjustments including increased amortization of goodwill related to the acquisitions.  The following table excludes the results of
Sports.com in 2001 and 2000 and includes DBC Sports, acquired in April 2000, as if it had been acquired on January 1, 2000.  For comparative purposes the financial information for 2002 has been presented although there were no dispositions or
acquisitions in 2002.  The unaudited pro forma information is provided for informational purposes only and should not be construed to be indicative of the Companys consolidated results of operations had the transactions been consummated
on the dates assumed and do not project the Companys results of operations for any future period:

|                       |  | 2002 |         | 2001 |   | 2000    |  
|---------------------- |  | ---- | ------- | ---- | - | ------- | -
|                       |  |      |         |      |   |         |  
|Revenue                |  | $    | 62,065  |      | $ | 60,046  |  
|Net loss               |  | $    | (48,225 | )    | $ | (84,743 | )
|Diluted loss per share |  | $    | (1.30   | )    | $ | (3.09   | )



|(5) | INVESTMENT IN UNCONSOLIDATED SUBSIDIARY AND PRO FORMA CONSOLIDATED FINANCIAL INFORMATION (UNAUDITED):
|--- | -----------------------------------------------------------------------------------------------------

As discussed in Note 4, the Company began accounting for its investment in Sports.com under the equity method of accounting as of July 17, 2001.  No losses have
been recorded after July 17, 2001, as the Companys investment in Sports.com has been reduced to zero and the Company has no future obligation to provide funding to Sports.com.  Unaudited condensed financial information of Sports.com is as
follows:

|                                      |                                            |                   |       |       
|------------------------------------- | ------------------------------------------ | ----------------- | ----- | ------
|Balance Sheet                         |                                            | December 31, 2001 |      
|                                      |                                            |                   |      
|Assets:                               |                                            |                   |       |       
|Current assets                        |                                            | $                 | 7,556 |       
|Other                                 |                                            |                   | 5,717 |       
|                                      |                                            |                   |       |       
|                                      | Total assets                               |                   | $     | 13,273
|                                      |                                            |                   |       |       
|Liabilities and shareholders equity: |                                            |                   |       |       
|Current liabilities                   |                                            | $                 | 5,138 |       
|Shareholders equity                  |                                            |                   | 8,135 |       
|                                      |                                            |                   |       |       
|                                      | Total liabilities and shareholders equity |                   | $     | 13,273
|                                      |                                            |                   |       |       



|         |  | Year Ended December 31, |        
|-------- |  | ----------------------- | -------
|         |  |                         |        
|         |  | 2001                    |        
|         |  |                         |        
|Revenue  |  | $                       | 7,253  
|Expenses |  |                         | (37,178
|         |  |                         |        
|Net loss |  | $                       | (29,925
|         |  |                         |        

62



---

##### Table of Contents

SPORTSLINE.COM, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)(amounts in thousands, except share and per
share data)

|(5) | INVESTMENT IN UNCONSOLIDATED SUBSIDIARY AND PRO FORMA CONSOLIDATED FINANCIAL INFORMATION (UNAUDITED):(Continued)
|--- | -----------------------------------------------------------------------------------------------------------------



The unaudited pro forma results for the years ended December 31, 2001 and 2000, assuming
the deconsolidation of Sports.com occurred as of January 1, 2000, are as follows:

|                                        |                               | Year Ended December 31 |        
|--------------------------------------- | ----------------------------- | ---------------------- | -------
|                                        |                               |                        |        
|                                        |                               | 2001                   |        
|                                        |                               |                        |        
|REVENUE                                 |                               | $                      | 60,046 
|COST OF REVENUE                         |                               |                        | 23,770 
|                                        |                               |                        |        
|GROSS PROFIT                            |                               |                        | 36,276 
|                                        |                               |                        |        
|OPERATING EXPENSES:                     |                               |                        |        
|                                        | Product development           |                        |        
|                                        | Sales and marketing           |                        |        
|                                        | General and administrative    |                        |        
|                                        | Depreciation and amortization |                        |        
|                                        | Write-down of goodwill        |                        |        
|                                        | Restructuring charge          |                        |        
|                                        |                               |                        |        
|                                        | Total operating expenses      |                        |        
|                                        |                               |                        |        
|LOSS FROM OPERATIONS                    |                               |                        | (91,215
|INTEREST EXPENSE                        |                               |                        | (1,064 
|INTEREST AND OTHER INCOME, net          |                               |                        | 3,109  
|GAIN ON SALE OF E-COMMERCE SUBSIDIARIES |                               |                        |       
|LOSS ON EQUITY INVESTMENTS              |                               |                        | (28    
|GAIN ON EXTINGUISHMENT OF DEBT          |                               |                        | 2,404  
|GAIN ON TERMINATION OF AGREEMENTS       |                               |                        | 2,051  
|                                        |                               |                        |        
|NET LOSS                                |                               | $                      | (84,743
|                                        |                               |                        |        
|NET LOSS PER SHARE - BASIC AND DILUTED  |                               | $                      | (3.09  
|                                        |                               |                        |        
|                                        |                               |                        |        

(6)     PROPERTY AND EQUIPMENT, NET:

Property and equipment, net consists of the following:

|                                                |  | Estimated Useful Lives (Years) |      | December 31, |     
|----------------------------------------------- |  | ------------------------------ | ---- | ------------ | ----
|                                                |  |                                |      |             
|                                                |  |                                | 2002 |              | 2001
|                                                |  |                                |      |              |     
|Computer equipment                              |  |                                | 2-3  |              | $   
|Furniture, fixtures and leasehold improvements  |  |                                | 3-10 |              |     
|                                                |  |                                |      |              |     
|                                                |  |                                |      |              |     
|Less: accumulated depreciation and amortization |  |                                |      |              |     
|                                                |  |                                |      |              |     
|                                                |  |                                |      |              | $   
|                                                |  |                                |      |              |     

Depreciation and amortization
expense on property and equipment amounted to approximately $5,886, $8,848 and $7,609 for the years ended December 31, 2002, 2001 and 2000, respectively.

63



---

##### Table of Contents

SPORTSLINE.COM, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)(amounts in thousands, except share and per
share data)

(7)     DEBT:

In March 1999, the
Company completed an offering of $150,000 aggregate principal amount of 5% Convertible Subordinated Notes due 2006 (the Convertible Subordinated Notes).  The Convertible Subordinated Notes are convertible, at the holders
option, into the Companys common stock at an initial conversion rate of 15.355 shares of common stock per thousand dollar principal amount (equivalent to a conversion price of approximately $65.125 per share), subject to adjustment in certain
events.  Interest on the Convertible Subordinated Notes is payable semiannually on April 1 and October 1 of each year.  The Convertible Subordinated Notes are unsecured and are subordinated to all existing and future Senior Indebtedness
(as defined in the indenture governing the Convertible Subordinated Notes (the Indenture)) of the Company.  The Convertible Subordinated Notes are redeemable at the option of the Company, in whole or part, at the redemption prices
set forth in the Indenture.  At this time the Company does not intend to redeem the Convertible Subordinated Notes. As of December 31, 2002 and 2001, the Company had no material indebtedness outstanding that would have constituted Senior
Indebtedness.  The Indenture does not limit the amount of additional indebtedness, including Senior Indebtedness, which the Company can create, incur, assume, or guarantee, nor does the Indenture limit the amount of indebtedness which any
subsidiary of the Company can create, incur, assume or guarantee.  The Indenture includes provisions that give the holders of the Convertible Subordinated Notes the right to require the Company to repurchase all or part of the Convertible
Subordinate Notes at 100% of the principal amount upon a change of control (as defined in the Indenture) or if the Companys common stock is no longer listed for trading on a national securities exchange nor approved for trading on an
established automated over-the-counter trading market.  In such case, the Company would have the option to repurchase the Convertible Subordinated Notes in cash or shares of common stock, valued at 95% of the average of the closing prices of
the common stock for the five consecutive trading days prior to the repurchase.

During the third and fourth quarters of 1999, the Company
repurchased $130,300 of its Convertible Subordinated Notes for approximately $90,100 and, as a result, the Company recognized a gain of $36,027, net of unamortized debt issuance costs.  During the fourth quarter of 2001, the Company repurchased
$2,930 of its Convertible Subordinated Notes for approximately $500 and, as a result, the Company recognized a gain of $2,404, net of unamortized debt issuance costs.  Convertible Subordinated Notes in an aggregate principal amount of
approximately $16,678, which are convertible into 256,091 shares of common stock, were outstanding as of December 31, 2002 and 2001.

(8)     SHAREHOLDERS
EQUITY:

Pursuant to the terms of the Companys Amended and Restated Certificate of Incorporation, the Board of Directors is
authorized to issue up to an aggregate of 1,000,000 shares of preferred stock in one or more series and to fix or alter the designations, preferences, rights and any qualifications, limitations or restrictions of the shares of each such series
thereof, including the dividend rates, conversion rights, voting rights, terms of redemption (including sinking fund provisions), redemption price or prices, liquidation preferences and the number of shares constituting any series or designations of
such series.  The Company has no present plans to issue any shares of preferred stock.

In March 1997, the Company entered into a
five-year agreement with CBS Broadcasting Inc. (CBS). In consideration of the advertising and promotional efforts of CBS and its license to the Company of the right to use certain CBS logos and television-related sports content, CBS
received 3,100,000 shares of common stock over the term of the agreement (752,273, 735,802, 558,988, 567,579 and 485,358 shares in 1997, 1998, 1999, 2000 and 2001, respectively).  The CBS agreement also required the Company to issue CBS, on the
first business day of each of the first five contract years, warrants to purchase 380,000 shares of common stock at per share exercise prices ranging from $10 in 1997 to $30 in 2001.  Such warrants were exercisable at any time during the
contract year in which they were granted.  As of December 31, 2001, all unexercised warrants issued to CBS had expired.  The value of the advertising and content was recorded annually in the consolidated balance sheets as deferred
advertising and content costs and expensed to amortization of equity issued to Viacom over each related contract year.  Amounts amortized to expense in 2002, 2001 and 2000 were $22,286, $17,288 and $17,288, respectively, consisting
of

64



---

##### Table of Contents

SPORTSLINE.COM, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)(amounts in thousands, except share and per
share data)

(8)     SHAREHOLDERS EQUITY:(Continued)

amortization relating to advertising of $20,000
in 2002 and $14,000 in both 2001 and 2000; content of $0 for 2002 and $518 for both 2001 and 2000; and expense related to warrants of $2,286 for 2002 and $2,770 for both 2001 and 2000.  Additionally, the Company expensed $1,750 in 2002 and
$3,000 in both 2001 and 2000 related to common stock issued to Westwood One, Inc. in exchange for promotion and programming.  These amounts are included in amortization of equity issued to Viacom in the accompanying consolidated statements of
operations for the years ended December 31, 2002, 2001 and 2000.

In February 1999, the Company amended and extended its agreement with
CBS.  The original revenue sharing provisions of the CBS agreement were eliminated and replaced by a new revenue sharing formula, which is calculated on a broader revenue base and at a lower rate.  In consideration of additional
promotional and advertising opportunities the Company agreed to accelerate the issuance of the remaining shares that were formerly to be issued in 2000 and 2001 (567,579 and 485,358 shares, respectively), issued additional warrants to purchase
1,200,000 shares of common stock at per share exercise prices ranging from $23 in 1999 to $45 in 2001 and agreed to issue additional shares of common stock valued at $100,000 between 2002 and 2006.  Shares having a fair market value of $20,000
will be issued each year based on the average of closing prices of the common stock on the Nasdaq National Market for the five-day period ending on the day prior to the applicable issue dates: January 1, 2002; April 1, 2003; July 1, 2004; October 1,
2005 and January 1, 2007.  On January 1, 2002, the Company issued 6,882,312 shares of common stock, having a market value of $20,000, to CBS pursuant to this agreement.  See Note 13 regarding the 2003 amendment of the CBS Agreement.

Total annual amounts to be recognized as sales and marketing expense, not including any revenue share payments, in accordance with the
CBS agreement, as amended, are set forth below.  The 2003 amendment did not have any effect on when such expense will be recognized.

|2003 |  | $ | 22,286 | 
|---- |  | - | ------ | 
|2004 |  |   | 22,286 | 
|2005 |  |   | 22,286 | 
|2006 |  |   | 22,286 | 
|     |  |   |        | 
|     |  | $ | 89,144 | 
|     |  |   |        | 

In March 2000, the Company issued
28,439 shares of common stock to the former owners of IGO in connection with the sale of IGO to MVP.  See Note 4.

In April 2000, in
connection with the acquisition of DBC Sports, the Company issued to DBC 277,152 shares of common stock.  Due to the decline in the trading price of the Companys common stock, the Company purchased such shares back from DBC for $12,500 in
April 2001 in order to fulfill certain obligations set forth in the acquisition agreement.  See Note 4.

In January 2000, CBS
exercised its year 2000 warrants resulting in net proceeds of $11,500.

In July 2001, the Company issued to the National Football
League 350,000 shares of the Companys common stock valued at $633 pursuant to the Companys agreement with the NFL.

In July
2002, the Company issued to AOL 1,945,525 shares of common stock with a value equal to $2,000 pursuant to the Companys agreement with AOL.

In September 2002, the Company issued to JAE Endorsements, Inc. and its assignees 200,000 shares of common stock with a value of $246 pursuant to the Companys
agreement with JAE Endorsements, Inc.

65



---

##### Table of Contents

SPORTSLINE.COM, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)(amounts in thousands, except share and per
share data)

(8)     SHAREHOLDERS EQUITY:(Continued)

The Company has reserved sufficient shares of its common stock to cover its issuance obligations under agreements with CBS, NFL and AOL, exercises of outstanding
common stock warrants and the stock option, incentive compensation and employee stock purchase plans discussed in Note 9.  The following is a summary of all common stock reserved for issuance:

|                               |                                          | Shares |          
|------------------------------ | ---------------------------------------- | ------ | ---------
|                               |                                          |        |          
|Warrants                       |                                          |        | 850,000  
|Employee stock option plans    |                                          |        | 2,373,050
|Employee stock purchase plan   |                                          |        | 195,622  
|Convertible Subordinated Notes |                                          |        | 256,091  
|                               |                                          |        |          
|                               | Total common stock reserved for issuance |        |          
|                               |                                          |        |          

In addition, the Company has
reserved common stock for issuance pursuant to the agreements with CBS, NFL and AOL.  The amount of such shares is undetermined as such obligations are based on a dollar value dependant upon the trading price of the Companys common stock
at certain dates in the future and, in certain cases, are subject to the Companys option to pay cash in lieu of issuing shares.

(9)     WARRANTS, STOCK OPTIONS
AND EMPLOYEE BENEFIT PLANS:

There were no warrants granted in 2002 and 2001. Common stock warrants issued in 2000 to non-employees
for services rendered primarily under consulting agreements were valued on the date of grant using the Black-Scholes option pricing model.  The following is a summary of warrants granted, exercised, canceled and outstanding:

|                                        |  | 2002   |           | 2001                            |   | 2000   | 
|--------------------------------------- |  | ------ | --------- | ------------------------------- | - | ------ | 
|                                        |  |        |           |                                 |   |        | 
|                                        |  | Shares |           | Weighted Average Exercise Price |   | Shares | 
|                                        |  |        |           |                                 |   |        | 
|Warrants outstanding, beginning of year |  |        | 1,157,000 |                                 | $ | 25.01  | 
|Granted                                 |  |        |          |                                 |   |       | 
|Exercised                               |  |        |          |                                 |   |       | 
|Canceled                                |  |        | (307,000  | )                               |   | 15.35  | 
|                                        |  |        |           |                                 |   |        | 
|Warrants outstanding,  end of year      |  |        | 850,000   |                                 | $ | 28.51  | 
|                                        |  |        |           |                                 |   |        | 

The range of exercise prices of
warrants outstanding at December 31, 2002 was $5.00 - $49.00.  The weighted average fair value of warrants granted during 2000 was $6.81 per share. There were 727,375 and 928,365 warrants exercisable at December 31, 2002 and 2001, respectively,
at a weighted average exerciseprice of $29.51 and $26.35 per share, respectively.  Warrants outstanding at December 31, 2002 are exercisable through various dates through 2009.

Assumptions utilized to value warrants granted in 2000 are as follows:

|Volatility Factor |  | Dividend Yield |   | Risk-Free Interest Rates |  | Estimated Lives (Years) |  
|----------------- |  | -------------- | - | ------------------------ |  | ----------------------- | -
|                  |  |                |   |                          |  |                         |  
|100%              |  |                | 0 | %                        |  | 5.8 - 6.0               | %
|                  |  |                |   |                          |  |                         |  

66



---

##### Table of Contents

SPORTSLINE.COM, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)(amounts in thousands, except share and per
share data)

(9)     WARRANTS, STOCK OPTIONS AND EMPLOYEE BENEFIT PLANS:  (Continued)

In 1995, the Company adopted a stock option plan (the 1995 Plan) under which the Company is authorized to issue a total of 1,200,000 incentive stock
options and nonqualified stock options to purchase common stock to be granted to employees, non-employee members of the Board of Directors and certain consultants or independent advisors who provide services to the Company.  Options become
exercisable for 25% of the option shares upon the optionees completion of one year of service, as defined, with the balance vesting in successive equal monthly installments upon the optionees completion of each of the next 36 months of
service.  The maximum term of the options is ten years.

On April 14, 1997, the Company adopted the 1997 Incentive Compensation
Plan (the Incentive Plan).  Pursuant to the Incentive Plan, as amended, the total number of shares of common stock that may be subject to the granting of awards shall be equal to:  (i) 8,000,000 shares, plus (ii) the number of
shares with respect to awards previously granted under the Incentive Plan that terminate without being exercised, expire, are forfeited or canceled, and the number of shares of common stock that are surrendered in payment of any awards or any tax
withholding requirements.  The Incentive Plan provides for grants of stock options, stock appreciation rights, restricted stock, deferred stock, other stock-related awards and performance or annual incentive awards at not less than the fair
market value of the underlying common stock that may be settled in cash, stock or other property.  At December 31, 2002, there were 2,373,050 shares available for issuance under both plans.

A summary of the activity relating to the Companys employee stock option plans for the years ended  December 31, 2002, 2001 and 2000 is presented
below:

|                                   |  | 2002   |           | 2001                            |   | 2000   | 
|---------------------------------- |  | ------ | --------- | ------------------------------- | - | ------ | 
|                                   |  |        |           |                                 |   |        | 
|                                   |  | Shares |           | Weighted Average Exercise Price |   | Shares | 
|                                   |  |        |           |                                 |   |        | 
|Outstanding at beginning of year   |  |        | 3,189,111 |                                 | $ | 11.01  | 
|Granted                            |  |        | 1,180,850 |                                 |   | 1.85   | 
|Exercised                          |  |        | (16,966   | )                               |   | 0.73   | 
|Canceled                           |  |        | (439,158  | )                               |   | 13.58  | 
|                                   |  |        |           |                                 |   |        | 
|Outstanding at end of year         |  |        | 3,913,837 |                                 | $ | 8.00   | 
|                                   |  |        |           |                                 |   |        | 
|Options exercisable at end of year |  |        | 2,169,264 |                                 | $ | 10.78  | 
|                                   |  |        |           |                                 |   |        | 

67



---

##### Table of Contents

SPORTSLINE.COM, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)(amounts in thousands, except share and per
share data)

(9)     WARRANTS, STOCK OPTIONS AND EMPLOYEE BENEFIT PLANS:  (Continued)

The following table summarizes information about employee stock options outstanding at December 31, 2002:

|                         |  | Options Outstanding              |           | Options Exercisable                                    | 
|------------------------ |  | -------------------------------- | --------- | ------------------------------------------------------ | 
|                         |  |                                  |           |                                                        | 
|Range of Exercise Prices |  | Outstanding at December 31, 2002 |           | Weighted Average Remaining Contractual Life (In Years) | 
|                         |  |                                  |           |                                                        | 
|$0.62 to $2.00           |  |                                  | 1,008,691 |                                                        | 
|2.01 to 5.00             |  |                                  | 1,375,565 |                                                        | 
|5.01 to 8.00             |  |                                  | 527,695   |                                                        | 
|8.01 to 15.00            |  |                                  | 388,534   |                                                        | 
|15.01 to 30.00           |  |                                  | 342,897   |                                                        | 
|30.01 to 60.00           |  |                                  | 270,455   |                                                        | 
|                         |  |                                  |           |                                                        | 
|                         |  |                                  | 3,913,837 |                                                        | 
|                         |  |                                  |           |                                                        | 

In August and September 2001, the
Company issued an aggregate of 1,909,458 shares of restricted stock to its executive officers and certain other key employees in exchange for the cancellation of certain outstanding stock options to purchase in the aggregate 3,818,919 shares of
common stock.  Deferred compensation has been recorded for the deemed market value of the restricted shares as of the issuance date in the amount of $2,024.  Such amount is being amortized to expense over the expected four-year vesting
period of the restricted stock.  Although vesting is over a four-year period, vesting may be accelerated upon the Company achieving certain financial goals.  During the fourth quarter of 2002, the Company achieved certain financial goals
and, as a result, the vesting of 10% of the outstanding shares of restricted stock was accelerated.  As of December 31, 2002, 641,526 shares of restricted stock had vested.

On April 14, 1997, the Company adopted the Employee Stock Purchase Plan (the Purchase Plan) and on November 19, 1999 the Purchase Plan was amended to
increase the number of shares of common stock reserved for issuance thereunder to 1,000,000.  The Purchase Plan provides eligible employees, as defined therein, the right to purchase shares of common stock.  The purchase price per share
will be equal to 85% of the fair market value as of certain measurement dates.  Such purchases are limited in any calendar year to the lower of 25% of the employees total annual compensation or $25.  There were 123,383, 176,460 and
73,883 shares of common stock issued pursuant to the Purchase Plan in 2002, 2001 and 2000, respectively.

In January 1996, the
Company adopted a retirement plan that qualifies under Section 401(k) of the Internal Revenue Code.  Under this plan, participating employees, as defined, may defer a portion of their pretax earnings, up to the Internal Revenue Service annual
contribution limits.  There is currently no matching of employee contributions by the Company.

(10)    INCOME TAXES:

The Company accounts for income taxes under SFAS No. 109, Accounting for Income Taxes. Deferred income tax assets and liabilities are determined
based upon differences between financial reporting and tax basis of assets and liabilities and are measured using the enacted tax rate and laws that will be in effect when the differences are expected to reverse.  Deferred income taxes reflect
the net tax effects of temporary differences between the carrying amount of assets and liabilities for financial reporting purposes and the amounts used for income tax

68



---

##### Table of Contents

SPORTSLINE.COM, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)(amounts in thousands, except share and per
share data)

(10)     INCOME TAXES :  (Continued)

purposes.  Significant components of the
Companys net deferred income taxes as of December 31, 2002 are as follows:

|Deferred tax assets:                     |                                 |  |      |         
|---------------------------------------- | ------------------------------- |  | ---- | --------
|                                         | Net operating losses            |  | $    | 70,776  
|                                         | Capital losses                  |  |      | 35,535  
|                                         | Expense items                   |  |      | 8,426   
|                                         |                                 |  |      |         
|                                         | Total gross deferred tax assets |  |      | 114,737 
|                                         | Less valuation allowance        |  |      | (114,306
|                                         |                                 |  |      |         
|                                         | Net deferred tax assets         |  |      | 431     
|Deferred tax liabilities  expense items |                                 |  | (431 | )       
|                                         |                                 |  |      |         
|                                         | Net deferred tax assets         |  | $    |        
|                                         |                                 |  |      |         
|                                         |                                 |  |      |         

SFAS No. 109 requires a valuation allowance to reduce the deferred tax assets reported, if, based on the weight of
the evidence, it is more likely than not that some portion or all of the deferred tax assets will not be realized.  After consideration of all the evidence, both positive and negative, management has determined that a $114,306 valuation
allowance at December 31, 2002 is necessary to reduce the deferred tax assets to the amount that will likely be realized.  The change in the valuation allowance for the current year was an increase of $16,015.  At December 31, 2002, the
Company has available net operating loss carryforwards of $185,032, which begin to expire in the year 2009.  Additionally, the Company has approximately $93,000 of capital loss carryforwards at December 31, 2002.

In  2002, the Company recorded a tax benefit of $720 due to a refund of alternative minimum taxes paid in 2000.  The reconciliation of income tax computed
at the U.S. Federal statutory rate to income tax expense is as follows:

|                                    |  | December 31, 2002 |    
|----------------------------------- |  | ----------------- | ---
|                                    |  |                   |    
|Tax at U.S. statutory rate          |  |                   | (34
|State taxes, net of federal benefit |  |                   | (4 
|Non-deductible items                |  |                   | 2  
|Change in valuation allowance       |  |                   | 36 
|                                    |  |                   |    
|                                    |  |                   | 0  
|                                    |  |                   |    

(11)     COMMITMENTS AND CONTINGENCIES:

The Company leases its facilities under noncancelable leases that expire on various dates through 2010.  Certain of these leases require the Company to
pay operating costs, including property taxes and maintenance costs and some include rent adjustment clauses.  The Company entered into a ten-year lease for its corporate headquarters beginning in March 2000.  Under the terms of certain of
its office leases, the Company has provided letters of credit to the landlords.  The letters of credit are secured by certain restricted certificates of deposit of approximately $535 as of December 31, 2002.

Rent expense amounted to approximately $2,096, $2,825 and $3,281 for the years ended December 31, 2002, 2001 and 2000, respectively.

69



---

##### Table of Contents

SPORTSLINE.COM, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)(amounts in thousands, except share and per
share data)

(11)     COMMITMENTS AND CONTINGENCIES:(Continued)

Future minimum lease payments for all operating leases are as follows as of December 31, 2002:

|2003                         |  | $ | 2,128  | 
|---------------------------- |  | - | ------ | 
|2004                         |  |   | 1,522  | 
|2005                         |  |   | 1,355  | 
|2006                         |  |   | 1,403  | 
|2007                         |  |   | 1,459  | 
|Thereafter                   |  |   | 3,496  | 
|                             |  |   |        | 
|Total minimum lease payments |  | $ | 11,363 | 
|                             |  |   |        | 

The Company has entered into
licensing, royalty and consulting agreements with various content providers, vendors and sports leagues and associations.  The remaining terms of these agreements as of December 31, 2002 range from one to four years.  These agreements
provide for the payment of royalties, bounties and certain guaranteed amounts. Several of the payments ($2,333 in 2003, $2,666 in 2004) are payable in stock at prevailing market prices in lieu of cash at the Companys option.  The
following agreements are included in the table of minimum guaranteed payments below:

NFL.com. In July 2001, the Company entered
into an agreement with the NFL, CBS and AOL (the NFL Agreement).  The Company is responsible for a portion of the rights fee payments required to be made to the NFL under the NFL Agreement. Under the terms of the multi-year
agreement, $4,238 has been paid as of December 31, 2002, and the Company is obligated to make additional payments totaling $19,812 as follows: $812 for the balance of the payment due for the second year ending July 2003; $6,000 for each of the third
and fourth years ending July 2004 and July 2005; and $7,000 for the fifth year ending July 2006. In addition, in July 2001 the Company issued to the NFL 350,000 shares of the Companys common stock and is obligated to make additional payments
in cash or stock, at the Companys option, equal to $1,333 and $2,667 in 2003 and 2004, respectively.  The Company is amortizing its total cost of the rights fee to sales and marketing expense on a straight-line basis over the five-year
term of the NFL Agreement.

AOL.  In July 2001, the Company extended its agreement with AOL (the AOL
Extension).  Under the terms of the multi-year promotional agreement, the Company paid AOL $1,000 in cash upon execution of the AOL Extension and on July 18, 2002 issued 1,945,525 shares of common stock to AOL with a value equal to
$2,000.  The Company is obligated to make an additional payment in cash and/or stock, at the Companys option, equal to $1,000 in 2003.  The Company is amortizing the costs of the AOL Extension to sales and marketing expense on a
straight-line basis over the approximate five-year term of the agreement.

PGA Tour. Under the terms of the Companys
agreement with the PGA TOUR, the Company was required to make an additional license fee payment in cash of $2,000 to the PGA TOUR in January 2003.  The Company will recognize the cost of such payment to sales and marketing expense during
2003.

Other Commitments.  In July 2002, the Company entered into an agreement with a third party vendor to purchase
approximately $1,000 worth of computer hardware over a three-year period.  This purchase is part of the Companys plan to continue to invest in equipment related to the expected growth of the business.  To date, the Company has
purchased $720 of equipment under the agreement.

70



---

##### Table of Contents

SPORTSLINE.COM, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)(amounts in thousands, except share and per
share data)

(11)     COMMITMENTS AND CONTINGENCIES:(Continued)

Minimum future guaranteed payments required under such agreements are as follows as of December 31, 2002:

|2003 |  | $ | 12,896 | 
|---- |  | - | ------ | 
|2004 |  |   | 9,355  | 
|2005 |  |   | 7,105  | 
|2006 |  |   | 1,930  | 
|2007 |  |   |       | 
|     |  |   |        | 
|     |  | $ | 31,286 | 
|     |  |   |        | 

Contingencies

In November 2001, Sandbox.com, Inc. (Sandbox) filed a lawsuit in the Seventeenth Judicial Circuit in and for Broward
County, Florida, alleging that the Company breached an agreement and plan of merger to acquire Sandbox (the Merger Agreement), misappropriated trade secrets, breached fiduciary duties, and was unjustly enriched as a consequence of
alleged transfers of assets and proprietary information.  The Company in its Answer and Affirmative Defenses and Claim of Right to Setoff asserts that it was within its contractual rights to terminate the Merger Agreement and otherwise denies
the substantive claims set forth in Sandboxs complaint, claims a $600 setoff for Sandboxs breach of the Merger Agreement, and has filed a counterclaim against Sandbox and a third party complaint against another party for fraud
in the inducement relating to the Merger Agreement and a related Consulting Agreement.  The case is in the pre-trial discovery phase, and no trial date or pretrial order has yet been set by the court.  On September 6, 2002, Sandbox
commenced a Chapter 11 bankruptcy proceeding in the United States Bankruptcy Court, Eastern District of Virginia, which was subsequently converted into a Chapter 7 bankruptcy proceeding.  The Company believes that it is unlikely that the
bankruptcy trustee will continue to pursue the case; however the Company believes that the claim by Sandbox is without merit and intends to vigorously defend itself in this action in the event the case is pursued by the trustee.  The Company
also intends to continue to pursue its claims against the third party defendant.

The Company is subject to various other legal
proceedings and claims arising in the ordinary course of business, including claims of alleged infringement of trademarks, copyrights, patents and other intellectual property rights.  The Companys management does not expect that the
outcome in any of these legal proceedings, individually or collectively, will have a material adverse effect on the Companys consolidated financial position or results of operations.  However, the Company may incur substantial expenses in
defending against third party claims.  In the event of a determination adverse to it, the Company may incur substantial monetary liability and be required to change its business practices.  Either of these could have a material adverse
effect on the Companys financial position, results of operations or cash flows.

(12)     RELATED PARTY TRANSACTIONS:

Pursuant to the Companys promotion and licensing agreement with CBS, the Company issued equity instruments to CBS and expensed $22,286, $17,288 and $17,288
during 2002, 2001 and 2000, respectively, primarily related to advertising and promotion on CBS.  See Note 8.  Since January 2002, CBS has owned approximately 32% of the Companys outstanding common stock.  Revenue sharing
expense was $3,877 for the year ended December 31, 2002.  Revenue from third party advertisers billed to CBS was $2,595 for the year ended December 31, 2002.  In addition, the Company expensed $1,750, $3,000 and $3,000 during 2002, 2001
and 2000, respectively, related to shares issued to Westwood One, Inc., a company that may be deemed an affiliate of CBS, in exchange for advertising and promotion, and the Company incurred television, radio and outdoor advertising expenses related
to services provided by CBS and/or certain of its affiliates of $367, $2,227 and $1,408 in 2002, 2001 and 2000, respectively.

The
Company has had transactions in the normal course of business with certain officers and directors of the Company.  The terms of these agreements were negotiated on what the Company believes is an arms-length

71



---

##### Table of Contents

SPORTSLINE.COM, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)(amounts in thousands, except share and per
share data)

(12)     RELATED PARTY TRANSACTIONS:(Continued)

basis.  In April 2001, the Company
loaned an officer of the Company $200 at an annual interest rate of 5.5% secured by the officers stock in the Company.  The loan and accrued interest were paid in full in December 2001.  The Company contracts for endorsement and
other services of Joe Namath through Planned Licensing, Inc., which is a wholly-owned subsidiary of Namanco Productions, Inc. whose president and sole stockholder is a director of the Company.  The Company has an agreement with Planned
Licensing, Inc. through October 16, 2004.  The Company incurred consulting and royalty expenses related to services provided by Planned Licensing, Inc. of $201, $207 and $267 in 2002, 2001 and 2000, respectively.  Additionally, in 2000 the
Company issued 30,000 common stock warrants to Planned Licensing, Inc. that vest over the life of the agreement.  The Company is obligated to make future minimum payments to Planned Licensing, Inc. totaling $350 under this agreement through
2004.

(13)     SUBSEQUENT EVENTS:

SportsTicker
Litigation.On January 28, 2003, SportsTicker Enterprises, L.P., a vendor of electronic sports data, filed a lawsuit against the Company in New York State Supreme Court, alleging that the Company improperly terminated its subscription
agreement with SportsTicker.  SportsTickers complaint seeks approximately $2,150 million in damages.  On March 24, 2003, the Company filed a motion to dismiss all claims, on the ground that SportsLines termination was expressly
authorized by the contract as a result of interruptions in SportsTickers service.  The motion has not yet been decided.  The Company believes the claim by SportsTicker is without merit and intends to vigorously defend itself in this
action.

NCAASports.com Agreement.  On February 26, 2003, the Company announced an agreement to sublicense the rights from CBS
for the official NCAA Championship Web site, in their entirety, through 2006. These rights include site production, hosting and management of the sale of advertising for the NCAASports.com Web site, and the exclusive rights to provide Internet
broadcasts of certain NCAA championships including the Division 1 Mens Basketball Championship.

Disposal of
VegasInsider.com and LVSC.  As part of the NCAASports.com agreement, the Company announced its intention to dispose of its gaming information operations, consisting of its VegasInsider.com and Las Vegas Sports Consultants
subsidiaries.  Beginning in its Quarterly Report on Form 10-Q for the quarter ending March 31, 2003, the Company will report the results from these operations as discontinued operations. The Company expects to dispose of the operations in the
second or third quarter of 2003.  The carrying amount of the assets and liabilities that will be included in the disposal group is approximately $2,000 and $100, respectively.

CBS Amendment.  On March 5, 2003, the CBS agreement was amended to modify the annual schedule of stock issuances to CBS.

April 2003 Payment.  On April 1, 2003, SportsLine is obligated to issue to CBS, the lesser of (1) a number of shares of common stock having a
fair market value of $20,000 on April 1, 2003; or (2) a number of shares of common stock that will result in CBS and its affiliates aggregate beneficial ownership interest in SportsLines outstanding common stock not exceeding 39.9% (in
which case the shares actually issued on April 1, 2003 will be valued at the current fair market value of such shares and the remainder of SportsLines $20,000 obligation will be deferred until July 2004).

July 2004 Payment.On July 1, 2004, SportsLine is obligated to issue to CBS the lesser of (1) a number of shares of common stock having a fair market
value on July 1, 2004 equal to (x) $20,000 plus (y) the amount of the April 2003 payment which was deferred; or (2) a number of shares of common stock that will result in CBS and its affiliates aggregate beneficial ownership interest in
SportsLines outstanding common stock not exceeding 49.9%.  If the number of shares of common stock that would result in CBS and its affiliates aggregate beneficial ownership interest in SportsLines outstanding common stock not
exceeding 49.9% has a fair market value on July 1, 2004 less than the amount of SportsLines total obligation on July 1, 2004 (i.e., $20,000 plus the deferred portion of the April 2003

72



---

##### Table of Contents

SPORTSLINE.COM, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)(amounts in thousands, except share and per
share data)

(13)     SUBSEQUENT EVENTS:(Continued)

payment), then SportsLine must satisfy up to $5,000 of
such obligation in cash.  SportsLine has the option to satisfy any additional remaining obligation on July 1, 2004 in cash and/or stock at its option.  If SportsLine elects to satisfy any portion of that remaining obligation, if any, in
stock and the issuance of such stock would cause the ownership interest of CBS and its affiliates to exceed 49.9% on July 1, 2004, then CBS may elect to defer that portion of the issuance until October 1, 2005.

October 2005 and January 2007 Payments.On October 1, 2005, SportsLine will remain obligated to issue to CBS common stock with a fair market value equal
to (x) $20,000 plus (y) the portion of the payment due in July 2004, if any, that CBS may have elected to defer.  SportsLine remains obligated to issue common stock with a fair market value of $20,000 to CBS on January 1, 2007.

73



---

##### Table of Contents

Item 9.     Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

On May 31, 2002, SportsLines Board of Directors approved the dismissal of Arthur Andersen LLP
(Andersen) as SportsLines independent accountants and the appointment of Ernst & Young LLP (E&Y) to serve as SportsLines independent accountants for the year ending December 31, 2002.  The Company
filed a current report on Form 8-K with the SEC on June 6, 2002, and amended such Form 8-K on June 14, 2002, to report the change.

During SportsLines two most recent fiscal years ended December 31, 2001, and the subsequent interim periods
through May 31, 2002, there were no disagreements between SportsLine and Andersen on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, which disagreements, if not resolved to
Andersens satisfaction, would have caused Andersen to make reference to the subject matter of the disagreement in connection with its reports; and there were no reportable events described under Item 304(a)(1)(v) of Regulation S-K.

The audit reports of Andersen on the consolidated financial statements of SportsLine as of and for
the fiscal years ended December 31, 2001 and 2000, as included elsewhere herein, did not contain any adverse opinion or disclaimer of opinion, nor were they qualified or modified as to uncertainty, audit scope or accounting principles.

74



---

##### Table of Contents

PART III

Item 10.     Directors and Executive Officers of Registrant

The information
required in response to this item is incorporated by reference to the Registrants Proxy Statement to be filed with the Securities and Exchange Commission pursuant to Regulation 14A not later than 120 days after the end of the fiscal year
covered by this report.

Item 11.      Executive Compensation

The information required in response to this
item is incorporated by reference to the Registrants Proxy Statement to be filed with the Securities and Exchange Commission pursuant to Regulation 14A not later than 120 days after the end of the fiscal year covered by this report.

Item 12.     Security Ownership of Certain Beneficial Owners and Management

The
information required in response to this item is incorporated by reference to the Registrants Proxy Statement to be filed with the Securities and Exchange Commission pursuant to Regulation 14A not later than 120 days after the end of the
fiscal year covered by this report.

Item 13.     Certain Relationships and Related Transactions

The information required in response to this item is incorporated by reference to the Registrants Proxy Statement to be filed with the Securities and Exchange
Commission pursuant to Regulation 14A not later than 120 days after the end of the fiscal year covered by this report.

Item 14.     Controls and Procedures

Within 90 days prior to the date of this report, the Company carried out an evaluation, under the supervision and with the participation of our principal executive
officer and principal financial officer, of the effectiveness of the design and operation of its disclosure controls and procedures. Based on this evaluation, our principal executive officer and principal financial officer concluded that the
Companys disclosure controls and procedures are effective in timely alerting them to material information required to be included in our periodic SEC reports. It should be noted that the design of any system of controls is based in part upon
certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions, regardless of how remote.

There have been no significant changes in the Companys internal controls or in other factors that could significantly affect those controls subsequent to the
date of their last evaluation.

75



---

##### Table of Contents

PART IV

Item 15.     Exhibits, Financial Statement Schedules and Reports on Form 8-K.

(a)     1.       Financial Statements:

Reference is
made to the Index to Financial Statements set forth in Item 8.  Financial Statements and Supplementary Data of this Annual Report on Form 10-K.

2.       Financial Statement Schedules:

All schedules for which provision is made in the applicable accounting regulations of the Securities and Exchange Commission (the Commission) are not
required under the related instructions, the required information is contained in the financial statements and notes thereto or are not applicable, and therefore have been omitted.

3.       Exhibits:

The following exhibits are filed as part of this Annual Report on Form 10-K:



|Exhibit |  | Description                                                                                                                                                                    
|------- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|        |  |                                                                                                                                                                                
|3.1     |  | Amended and Restated Certificate of Incorporation (3.1)(1)                                                                                                                     
|3.2     |  | Amendment of Article IV of the Amended and Restated Certificate of Incorporation (3.2)(2)                                                                                      
|3.3     |  | Amendment of Article I of the Amended and Restated Certificate of Incorporation (3.3)(3)                                                                                       
|3.2     |  | Form of Amended and Restated Bylaws (3.2) (4)                                                                                                                                  
|10.1*   |  | Form of Indemnification Agreement between the Company and each of its directors and executive officers (10.2) (4)                                                              
|10.2*   |  | 1995 Stock Option Plan (10.1) (4)                                                                                                                                              
|10.3*   |  | 1997 Incentive Compensation Plan, as amended (4.1)(5)                                                                                                                          
|10.4*   |  | Employee Stock Purchase Plan, as amended (10.4)(3)                                                                                                                             
|10.5    |  | Agreement dated March 5, 1997 between the Company and CBS Inc. (10.6) (4)                                                                                                      
|10.6+   |  | Premier Sports Information and Commerce Agreement, effective as of October 1, 1998, by and between the Company and America Online, Inc. (10.1) (6)                             
|10.7    |  | Amendment to Agreement, effective as of January 1, 1999, between the Company and CBS Broadcasting, Inc. (99.1) (7)                                                             
|10.8*   |  | Amended and Restated Employment Agreement, dated as of January 28, 2000, between the Company and Michael Levy (10.14)(3)                                                       
|10.9*   |  | Amended and Restated Employment Agreement, dated as of January 28, 2000, between the Company and Kenneth W. Sanders (10.15)(3)                                                 
|10.10*  |  | Employment Agreement, dated as of January 28, 2000, between the Company and Mark J. Mariani (10.18)(3)                                                                         
|10.11   |  | First Amendment to License and Consulting Agreement between the Company and Planned Licensing, Inc. dated as of October 16, 1999 (10.19)(3)                                    
|10.12*  |  | Amendment to the Employment Agreement of Michael Levy, dated as of June 30, 2000 (10.1)(8)                                                                                     
|10.13*  |  | Second Amendment to Amended and Restated Employment Agreement of Michael Levy dated as of August 20, 2001 (10.1)(9)                                                            
|10.14*  |  | First Amendment to Amended and Restated Employment Agreement of Kenneth Sanders dated as of August 20, 2001 (10.2)(9)                                                          
|10.15*  |  | First Amendment to Employment Agreement of Mark Mariani dated as of August 20, 2001 (10.5)(9)                                                                                  
|10.16*  |  | Employment Agreement of Peter Pezaris dated as of August 20, 2001 (10.6)(9)                                                                                                    
|10.17++ |  | NFL Interactive Media Rights Agreement among NFL Enterprises, L.P., and America Online, Inc., CBS Broadcasting Inc. and SportsLine.com, Inc. dated as of July 6, 2001
(10.7)(9)
|10.18++ |  | Third Amendment to Premier Sports Information and Commerce Agreement, effective as of July 6, 2001, by and between America Online, Inc. and SportsLine.com, Inc.
(10.8)(9)     

76



---

##### Table of Contents

|21.1 |  | Subsidiaries of the Company (filed herewith)                                                                                                                 
|---- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------
|23.1 |  | Consent of Independent Certified Public Accountants, Ernst & Young LLP (filed herewith)                                                                      
|23.2 |  | Notice Regarding Consent of Arthur Andersen LLP (filed herewith)                                                                                             
|99.1 |  | Certification of Michael Levy Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (filed herewith)      
|99.2 |  | Certification of Kenneth W. Sanders Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (filed herewith)



|   
|---
|   
|(1)
|(2)
|(3)
|(4)
|(5)
|(6)
|(7)
|(8)
|(9)
|*  
|+  
|++ 

(b)                    Reports on Form 8-K

The Company did not file any Reports on Form 8-K during the three months ended December 31, 2002.

77



---

##### Table of Contents

SIGNATURES

Pursuant to the requirements
of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

|               | SPORTSLINE.COM, INC.
|-------------- | --------------------
|               |                     
|               | By:                 
|               |                     
|               |                     
|March 28, 2003 |                     

Pursuant to the requirements of
the Securities Exchange Act of 1934, this report has been signed by the following persons on behalf of the registrant in the capacities and on the dates indicated:

|Signature               |  | Title                                                                         |  | Date          
|----------------------- |  | ----------------------------------------------------------------------------- |  | --------------
|                        |  |                                                                               |  |               
|                        |  |                                                                               |  |               
|/s/ MICHAEL LEVY        |  | President, Chief Executive Officer and Director (principal executive officer) |  | March 28, 2003
|                        |  |                                                                               | 
|Michael Levy            |  |                                                                               |  |               
|                        |  |                                                                               |  |               
|                        |  |                                                                               |  |               
|/s/ KENNETHW. SANDERS   |  | Chief Financial Officer (principal financial and accounting officer)          |  | March 28, 2003
|                        |  |                                                                               | 
|Kenneth W. Sanders      |  |                                                                               |  |               
|                        |  |                                                                               |  |               
|                        |  | Director                                                                      |  |               
|                        |  |                                                                               |  |               
|Thomas Cullen           |  |                                                                               |  |               
|                        |  |                                                                               |  |               
|/s/ GERRY HOGAN         |  | Director                                                                      |  | March 28, 2003
|                        |  |                                                                               |  |               
|Gerry Hogan             |  |                                                                               |  |               
|                        |  |                                                                               |  |               
|/s/ RICHARD B. HORROW   |  | Director                                                                      |  | March 28, 2003
|                        |  |                                                                               |  |               
|Richard B. Horrow       |  |                                                                               |  |               
|                        |  |                                                                               |  |               
|/s/ JOSEPH LACOB        |  | Director                                                                      |  | March 28, 2003
|                        |  |                                                                               |  |               
|Joseph Lacob            |  |                                                                               |  |               
|                        |  |                                                                               |  |               
|/s/ SEAN MCMANUS        |  | Director                                                                      |  | March 28, 2003
|                        |  |                                                                               |  |               
|Sean McManus            |  |                                                                               |  |               
|                        |  |                                                                               |  |               
|/s/ ANDREW NIBLEY       |  | Director                                                                      |  | March 28, 2003
|                        |  |                                                                               |  |               
|Andrew Nibley           |  |                                                                               |  |               
|                        |  |                                                                               |  |               
|/s/ RUSSELL I. PILLAR   |  | Director                                                                      |  | March 28, 2003
|                        |  |                                                                               |  |               
|Russell I. Pillar       |  |                                                                               |  |               
|                        |  |                                                                               |  |               
|/s/ MICHAEL P. SCHULHOF |  | Director                                                                      |  | March 28, 2003
|                        |  |                                                                               |  |               
|Michael P. Schulhof     |  |                                                                               |  |               
|                        |  |                                                                               |  |               
|/s/ JAMES C. WALSH      |  | Director                                                                      |  | March 28, 2003
|                        |  |                                                                               |  |               
|James C. Walsh          |  |                                                                               |  |               

78



---

##### Table of Contents

CERTIFICATIONS

I, Michael Levy, certify that:

1.  I have reviewed this annual report on Form 10-K of SportsLine.com, Inc.;

2.  Based on my knowledge, this annual report does not contain any untrue statement of a
material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this annual report;

3.  Based on my knowledge, the financial statements, and other financial information
included in this annual report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this annual report;

4.  The registrants other certifying officers and I are responsible for establishing and maintaining
disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

| | a)  designed such disclosure controls and procedures to ensure that material information relating to the
registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this annual report is being prepared;
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |                                                                                                                                                                                                                                                                                                 
| | b)  evaluated the effectiveness of the registrants disclosure controls and procedures as of a date within
90 days prior to the filing date of this annual report (the Evaluation Date); and                                                                                                  
| |                                                                                                                                                                                                                                                                                                 
| | c)  presented in this annual report our conclusions about the effectiveness of the disclosure controls and
procedures based on our evaluation as of the Evaluation Date;                                                                                                                        

5.  The registrants other certifying officers and I have disclosed, based on our most recent
evaluation, to the registrants auditors and the audit committee of registrants board of directors (or persons performing the equivalent function):

| | a) all significant deficiencies in the design or operation of internal controls which could adversely affect the
registrants ability to record, process, summarize and report financial data and have identified for the registrants auditors any material weaknesses in internal controls; and
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |                                                                                                                                                                                                                                                                                                  
| | b) any fraud, whether or not material, that involves management or other employees who have a significant role in the
registrants internal controls; and                                                                                                                                        

6.  The
registrants other certifying officers and I have indicated in this annual report whether or not there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of
our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.

|Date: March 28, 2003 |                                                                                 
|-------------------- | --------------------------------------------------------------------------------
|                     |                                                                                 
|                     | /s/ MICHAEL LEVY                                                                
|                     |                                                                                 
|                     | Michael Levy President and Chief Executive Officer (Principal Executive Officer)
|                     |                                                                                 

79



---

##### Table of Contents

CERTIFICATIONS

I, Kenneth W. Sanders, certify that:

1.  I have reviewed this annual report on Form 10-K of SportsLine.com, Inc.;

2.  Based on my knowledge, this annual report does not contain any untrue statement of a
material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this annual report;

3.  Based on my knowledge, the financial statements, and other financial information
included in this annual report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this annual report;

4.  The registrants other certifying officers and I are responsible for establishing and
maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

| | a)  designed such disclosure controls and procedures to ensure that material information relating to the
registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this annual report is being prepared;
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |                                                                                                                                                                                                                                                                                                 
| | b)  evaluated the effectiveness of the registrants disclosure controls and procedures as of a date within
90 days prior to the filing date of this annual report (the Evaluation Date); and                                                                                                  
| |                                                                                                                                                                                                                                                                                                 
| | c)  presented in this annual report our conclusions about the effectiveness of the disclosure controls and
procedures based on our evaluation as of the Evaluation Date;                                                                                                                        

5.  The registrants other certifying officers and I have disclosed, based on our most recent
evaluation, to the registrants auditors and the audit committee of registrants board of directors (or persons performing the equivalent function):

| | a) all significant deficiencies in the design or operation of internal controls which could adversely affect the
registrants ability to record, process, summarize and report financial data and have identified for the registrants auditors any material weaknesses in internal controls; and
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |                                                                                                                                                                                                                                                                                                  
| | b) any fraud, whether or not material, that involves management or other employees who have a significant role in the
registrants internal controls; and                                                                                                                                        

6.  The
registrants other certifying officers and I have indicated in this annual report whether or not there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of
our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.

|Date: March 28, 2003 |                                                                         
|-------------------- | ------------------------------------------------------------------------
|                     |                                                                         
|                     | /s/ KENNETH W. SANDERS                                                  
|                     |                                                                         
|                     | Kenneth W. Sanders Chief Financial Officer (Principal Financial Officer)
|                     |                                                                         

80



---

##### Table of Contents

EXHIBIT INDEX

|Exhibit |  | Description                                                                                                                                                  
|------- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------
|        |  |                                                                                                                                                              
|21.1    |  | Subsidiaries of the Company                                                                                                                                  
|23.1    |  | Consent of Independent Certified Public Accountants, Ernst & Young LLP                                                                                       
|23.2    |  | Notice Regarding Consent of Arthur Andersen LLP                                                                                                              
|99.1    |  | Certification of Michael Levy Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (filed herewith)      
|99.2    |  | Certification of Kenneth W. Sanders Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (filed herewith)

81