SECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549

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FORM 10-K/A
(Amendment No. 1)

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|(Mark One)                                                    |                                                                                         
|------------------------------------------------------------- | ----------------------------------------------------------------------------------------
|ý                                                             | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934    
|FOR THE FISCAL YEAR ENDED DECEMBER 31, 2004                  
|or                                                           
|o                                                             | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|FOR THE TRANSITION PERIOD
FROM                             TO

Commission File Number 333-61386

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Advanstar, Inc.(Exact name of registrant as specified in its charter)

|Delaware(State or other jurisdiction of
incorporation or organization)      |  | 94-3243499(I.R.S. Employer
Identification No.)
|--------------------------------------------------------------------------- |  | ----------------------------------------------
|One Park Avenue, New York, New York(Address of principal executive offices) |  | 10016(Zip Code)                               

Registrant's
telephone number, including area code:(212)951-6600

Securities
registered pursuant to Section 12(b) of the Act:None

Securities
registered pursuant to Section 12(g) of the Act:None

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 ý    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. ý

Indicate by check mark whether the registrant is an accelerated filer (as defined in Exchange Act
Rule 12b-2). Yes o    No ý

As of June 30, 2004, none of the registrant's common stock was held by non-affiliates of the registrant.

As
of March 29, 2005, the registrant had 100 shares of common stock issued and outstanding.

DOCUMENTS
INCORPORATED BY REFERENCE

None.



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EXPLANATORY NOTE

Advanstar, Inc., (the "Company") is filing this Amendment No. 1 on Form 10-K/A to its Annual Report on
Form 10-K for the fiscal year ended December 31, 2004 (the "Original Filing"), which was originally filed on March 29, 2005, to amend the Report of Independent
Registered Public Accounting Firm in Item 8 and Item 15 of the Original Filing. The amended report complies with Auditing Standard No. 1 of the PCAOB, References in Audit Reports to Standards
of the Public Company Accounting Oversight Board (United States). The Original Filing inadvertently omitted the reference to the Public Company Accounting Oversight Board.

No
other changes to the Company's 2004 Form 10-K have been made.

The
undersigned registrant hereby amends the financial statements contained in Item 8 and Item 15 of its Report on Form 10-K for the year ended December 31,
2004 as follows:

1

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Report of Independent Registered Public Accounting Firm

To
the Stockholder and Board of
Directors of Advanstar, Inc.

In
our opinion, the consolidated financial statements listed in the index appearing under Item 15(a)(1) present fairly, in all material respects, the financial position of
Advanstar, Inc., a wholly owned subsidiary of Advanstar Holdings Corporation, and its Subsidiaries at December 31, 2004 and 2003, and the results of their operations and their cash flows
for each of the three years in the period ended December 31, 2004, in conformity with accounting principles generally accepted in the United States of America. In addition, in our opinion, the
financial statement schedules listed in the index appearing under Item 15(a)(2) present fairly, in all material respects, the information set forth therein when read in conjunction with the related
consolidated financial statements. These financial statements and financial statement schedules are the responsibility of the Company's management; our responsibility is to express an opinion on these
financial statements and financial statement schedules based on our audits. We conducted our audits of these statements in accordance with the standards of the Public Company Accounting Oversight
Board (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, assessing the accounting principles used and significant estimates made by management,
and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

As
discussed in Note 3 to the consolidated financial statements, the Company adopted Statement of Financial Accounting Standards No. 142, "Goodwill and Other Intangible
Assets", on January 1, 2002.

/s/
PricewaterhouseCoopers LLP

Minneapolis,
Minnesota
February 11, 2005

F-2

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Advanstar, Inc.  Consolidated Balance Sheets  December 31, 2004 and 2003

|                                                 |                                                                                                                         | 2004                                   |         | 2003     |        
|------------------------------------------------ | ----------------------------------------------------------------------------------------------------------------------- | -------------------------------------- | ------- | -------- | -------
|
|Assets                                           |                                                                                                                         |                                        |         |          |        
|Current assets                                   |                                                                                                                         |                                        |         |          |        
|                                                 | Cash and cash equivalents                                                                                               |                                        | $       | 41,328   |        
|                                                 | Accounts receivable, net of allowance of $798 and $842 at December 31, 2004 and 2003                                    |                                        |         | 27,289   |        
|                                                 | Prepaid expenses                                                                                                        |                                        |         | 8,839    |        
|                                                 | Other                                                                                                                   |                                        |         | 2,476    |        
|                                                 | Current assets of discontinued operations                                                                               |                                        |         |         |        
|                                                 |                                                                                                                         |                                        |         |          |        
|                                                 |                                                                                                                         | Total current assets                   |         |          | 79,932 
|                                                 |                                                                                                                         |                                        |         |          |        
|Due from parent                                  |                                                                                                                         |                                        | 256     |          |        
|Property, plant and equipment, net               |                                                                                                                         |                                        | 25,153  |          |        
|Intangible and other assets                      |                                                                                                                         |                                        |         |          |        
|                                                 | Goodwill                                                                                                                |                                        |         | 707,756  |        
|                                                 | Intangibles and other, net                                                                                              |                                        |         | 101,813  |        
|                                                 |                                                                                                                         |                                        |         |          |        
|                                                 |                                                                                                                         | Total intangible and other assets, net |         |          | 809,569
|Non-current assets of discontinued operations    |                                                                                                                         |                                        |        |          |        
|                                                 |                                                                                                                         |                                        |         |          |        
|                                                 |                                                                                                                         | $                                      | 914,910 |          | $      
|                                                 |                                                                                                                         |                                        |         |          |        
|Liabilities and Stockholder's Equity             |                                                                                                                         |                                        |         |          |        
|Current liabilities                              |                                                                                                                         |                                        |         |          |        
|                                                 | Current maturities of long-term debt                                                                                    |                                        | $       | 1,300    |        
|                                                 | Accounts payable                                                                                                        |                                        |         | 14,067   |        
|                                                 | Accrued compensation                                                                                                    |                                        |         | 8,695    |        
|                                                 | Other accrued expenses                                                                                                  |                                        |         | 34,103   |        
|                                                 | Deferred revenue                                                                                                        |                                        |         | 52,397   |        
|                                                 | Current liabilities of discontinued operations                                                                          |                                        |         |         |        
|                                                 |                                                                                                                         |                                        |         |          |        
|                                                 |                                                                                                                         | Total current liabilities              |         |          | 110,562
|                                                 |                                                                                                                         |                                        |         |          |        
|Long-term debt, net of current maturities        |                                                                                                                         |                                        | 752,019 |          |        
|Deferred income taxes                            |                                                                                                                         |                                        | 18,250  |          |        
|Other long-term liabilities                      |                                                                                                                         |                                        | 4,277   |          |        
|Minority interests                               |                                                                                                                         |                                        | 3,579   |          |        
|Long term liabilities of discontinued operations |                                                                                                                         |                                        |        |          |        
|Commitments and contingencies (Notes 11 and 13)  |                                                                                                                         |                                        |        |          |        
|Stockholder's equity                             |                                                                                                                         |                                        |         |          |        
|                                                 | Common stock, $.01 par value, 10,000 shares authorized; 100 shares issued and outstanding at December 31, 2004 and 2003 |                                        |         |         |        
|                                                 | Capital in excess of par value                                                                                          |                                        |         | 370,424  |        
|                                                 | Accumulated deficit                                                                                                     |                                        |         | (350,446 | )      
|                                                 | Accumulated other comprehensive income                                                                                  |                                        |         | 6,245    |        
|                                                 |                                                                                                                         |                                        |         |          |        
|                                                 |                                                                                                                         | Total stockholder's equity             |         |          | 26,223 
|                                                 |                                                                                                                         |                                        |         |          |        
|                                                 |                                                                                                                         | $                                      | 914,910 |          | $      
|                                                 |                                                                                                                         |                                        |         |          |        

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

F-3

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Advanstar, Inc.  Consolidated Statements of Operations  Years Ended December 31, 2004, 2003 and 2002

|                                                                                                                                                                                            |                                                             | 2004                                                                                                               |         | 2003    |         | 2002    |        
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------ | ------- | ------- | ------- | ------- | -------
|
|Revenue                                                                                                                                                                                     |                                                             | $                                                                                                                  | 380,471 |         | $       | 308,962 |        
|Operating expenses                                                                                                                                                                          |                                                             |                                                                                                                    |         |         |         |         |        
|                                                                                                                                                                                            | Cost of production (excluding depreciation)                 |                                                                                                                    |         | 76,791  |         |         | 62,895 
|                                                                                                                                                                                            | Selling, editorial and circulation (excluding depreciation) |                                                                                                                    |         | 163,598 |         |         | 128,783
|                                                                                                                                                                                            | General and administrative (excluding depreciation)         |                                                                                                                    |         | 45,817  |         |         | 35,310 
|                                                                                                                                                                                            | Restructuring charge                                        |                                                                                                                    |         | (4,015  | )       |         | 2,692  
|                                                                                                                                                                                            | Amortization of intangibles                                 |                                                                                                                    |         | 41,575  |         |         | 47,120 
|                                                                                                                                                                                            | Depreciation                                                |                                                                                                                    |         | 8,595   |         |         | 10,601 
|                                                                                                                                                                                            |                                                             |                                                                                                                    |         |         |         |         |        
|                                                                                                                                                                                            |                                                             | Total operating expenses                                                                                           |         |         | 332,361 |         |        
|                                                                                                                                                                                            |                                                             |                                                                                                                    |         |         |         |         |        
|                                                                                                                                                                                            |                                                             | Operating income                                                                                                   |         |         | 48,110  |         |        
|Other income (expense)                                                                                                                                                                      |                                                             |                                                                                                                    |         |         |         |         |        
|                                                                                                                                                                                            | Interest expense, net                                       |                                                                                                                    |         | (91,353 | )       |         | (75,924
|                                                                                                                                                                                            | Write-off of deferred financing costs                       |                                                                                                                    |         |        |         |         | (11,324
|                                                                                                                                                                                            | Other income (expense), net                                 |                                                                                                                    |         | 375     |         |         | 140    
|                                                                                                                                                                                            |                                                             |                                                                                                                    |         |         |         |         |        
|                                                                                                                                                                                            |                                                             | Loss from continuing operations before income taxes, minority interests and cumulative effect of accounting change |         |         | (42,868 | )       |        
|Income tax provision (benefit)                                                                                                                                                              |                                                             |                                                                                                                    | 13,954  |         |         | 4,283   |        
|Minority interests                                                                                                                                                                          |                                                             |                                                                                                                    | (562    | )       |         | (403    | )      
|                                                                                                                                                                                            |                                                             |                                                                                                                    |         |         |         |         |        
|                                                                                                                                                                                            |                                                             | Loss from continuing operations before cumulative effect of accounting change                                      |         |         | (57,384 | )       |        
|(Loss) income from operations of discontinued business (including a goodwill impairment charge of $15,570 net of minority interest of $5,072 for the year ended December 31, 2004) (Note 5) |                                                             |                                                                                                                    | (9,743  | )       |         | 89      |        
|                                                                                                                                                                                            |                                                             |                                                                                                                    |         |         |         |         |        
|                                                                                                                                                                                            |                                                             | Loss before cumulative effect of accounting change                                                                 |         |         | (67,127 | )       |        
|Cumulative effect of accounting change, net of tax and minority interest                                                                                                                    |                                                             |                                                                                                                    |        |         |         |        |        
|                                                                                                                                                                                            |                                                             |                                                                                                                    |         |         |         |         |        
|                                                                                                                                                                                            |                                                             | Net loss                                                                                                           |         | $       | (67,127 | )       | $      
|                                                                                                                                                                                            |                                                             |                                                                                                                    |         |         |         |         |        

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

F-4

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Advanstar, Inc.  Consolidated Statements of Stockholder's Equity  Years Ended December 31, 2004, 2003 and 2002

|                                    |                                                               | Common Stock             |   |   |   |   |   | Accumulated
Other
Comprehensive
Income (Loss) |   |   |         
|----------------------------------- | ------------------------------------------------------------- | ------------------------ | - | - | - | - | - | --------------------------------------------- | - | - | --------
|
|
|
|Balances at December 31, 2001       |                                                               | 100                      |   | $ |  |   | $ | 310,424                                       |   | $ | (95,096 
|Comprehensive loss                  |                                                               |                          |   |   |   |   |   |                                               |   |   |         
|                                    | Net loss                                                      |                          |  |   |   |  |   |                                               |  |   |         
|                                    | Translation adjustment                                        |                          |  |   |   |  |   |                                               |  |   |         
|                                    | Change in unrealized loss on derivative financial instruments |                          |  |   |   |  |   |                                               |  |   |         
|                                    |                                                               | Total comprehensive loss |   |  |   |   |  |                                               |   |  |         
|                                    |                                                               |                          |   |   |   |   |   |                                               |   |   |         
|Balances at December 31, 2002       |                                                               | 100                      |   |   |  |   |   | 310,424                                       |   |   | (213,175
|Comprehensive loss                  |                                                               |                          |   |   |   |   |   |                                               |   |   |         
|                                    | Net loss                                                      |                          |  |   |   |  |   |                                               |  |   |         
|                                    | Translation adjustment                                        |                          |  |   |   |  |   |                                               |  |   |         
|                                    | Change in unrealized loss on derivative financial instruments |                          |  |   |   |  |   |                                               |  |   |         
|                                    |                                                               | Total comprehensive loss |   |  |   |   |  |                                               |   |  |         
|Contribution of capital from parent |                                                               |                         |   |   |  |   |   | 60,000                                        |   |   |        
|                                    |                                                               |                          |   |   |   |   |   |                                               |   |   |         
|Balances at December 31, 2003       |                                                               | 100                      |   |   |  |   |   | 370,424                                       |   |   | (283,319
|Comprehensive loss                  |                                                               |                          |   |   |   |   |   |                                               |   |   |         
|                                    | Net loss                                                      |                          |  |   |   |  |   |                                               |  |   |         
|                                    | Translation adjustment                                        |                          |  |   |   |  |   |                                               |  |   |         
|                                    | Change in unrealized loss on derivative financial instruments |                          |  |   |   |  |   |                                               |  |   |         
|                                    |                                                               | Total comprehensive loss |   |  |   |   |  |                                               |   |  |         
|                                    |                                                               |                          |   |   |   |   |   |                                               |   |   |         
|Balances at December 31, 2004       |                                                               | 100                      |   | $ |  |   | $ | 370,424                                       |   | $ | (350,446
|                                    |                                                               |                          |   |   |   |   |   |                                               |   |   |         

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

F-5

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Advanstar, Inc.  Consolidated Statements of Cash Flows  Years Ended December 31, 2004, 2003 and 2002

|                                                                               |                                                     | 2004                                  |                                                      | 2003   |         | 2002     |       
|------------------------------------------------------------------------------ | --------------------------------------------------- | ------------------------------------- | ---------------------------------------------------- | ------ | ------- | -------- | ------
|
|Cash flows from operating activities                                           |                                                     |                                       |                                                      |        |         |          |       
|Net loss                                                                       |                                                     | $                                     | (67,127                                              | )      | $       | (70,144  | )     
|Adjustments to reconcile net loss to net cash provided by operating activities |                                                     |                                       |                                                      |        |         |          |       
|                                                                               | Cumulative effect of accounting changetransitional |                                       |                                                      |        |         |          |       
|                                                                               | goodwill impairment                                 |                                       |                                                      |       |         |          |      
|                                                                               | Write-off of deferred financing costs               |                                       |                                                      |       |         |          | 11,324
|                                                                               | Restructuring charge                                |                                       |                                                      | (4,015 | )       |          |      
|                                                                               | Impairment of goodwill                              |                                       |                                                      | 15,570 |         |          |      
|                                                                               | Depreciation and amortization                       |                                       |                                                      | 50,433 |         |          | 59,180
|                                                                               | (Gain) on derivative financial instruments          |                                       |                                                      | (1,391 | )       |          | (772  
|                                                                               | Undistributed earnings of minority interest holders |                                       |                                                      | 562    |         |          | 627   
|                                                                               | Noncash interest expense                            |                                       |                                                      | 24,489 |         |          | 21,386
|                                                                               | (Gain) loss on disposition of business and other    |                                       |                                                      | (1,006 | )       |          | 661   
|                                                                               | Provision for bad debts                             |                                       |                                                      | 874    |         |          | 589   
|                                                                               | Deferred income taxes                               |                                       |                                                      | 11,260 |         |          | 6,990 
|                                                                               | Changes in operating assets and liabilities         |                                       |                                                      |        |         |          |       
|                                                                               |                                                     | Accounts receivable                   |                                                      |        | 6,060   |          |       
|                                                                               |                                                     | Inventories                           |                                                      |        | (708    | )        |       
|                                                                               |                                                     | Prepaid expenses                      |                                                      |        | (506    | )        |       
|                                                                               |                                                     | Accounts payable and accrued expenses |                                                      |        | (10,776 | )        |       
|                                                                               |                                                     | Deferred revenue                      |                                                      |        | (6,902  | )        |       
|                                                                               |                                                     | Other                                 |                                                      |        | 1,733   |          |       
|                                                                               |                                                     |                                       |                                                      |        |         |          |       
|                                                                               |                                                     |                                       | Net cash provided by operating activities            |        |         | 18,550   |       
|                                                                               |                                                     |                                       |                                                      |        |         |          |       
|Cash flows from investing activities                                           |                                                     |                                       |                                                      |        |         |          |       
|Additions to property, plant and equipment                                     |                                                     |                                       | (9,576                                               | )      |         | (7,930   | )     
|Acquisition of publications and trade shows, net of cash acquired              |                                                     |                                       | (7,915                                               | )      |         | (137,728 | )     
|Proceeds from sale of assets                                                   |                                                     |                                       | 24,418                                               |        |         |         |       
|Acquisitions of intangibles, contingent payments, and other                    |                                                     |                                       | (1,931                                               | )      |         | 3        |       
|                                                                               |                                                     |                                       |                                                      |        |         |          |       
|                                                                               |                                                     |                                       | Net cash provided by (used in) investing activities  |        |         | 4,996    |       
|                                                                               |                                                     |                                       |                                                      |        |         |          |       
|Cash flows from financing activities                                           |                                                     |                                       |                                                      |        |         |          |       
|Proceeds from revolving credit loan                                            |                                                     |                                       | (14,000                                              | )      |         | (50,100  | )     
|Payments on revolving credit loan                                              |                                                     |                                       | 6,000                                                |        |         | 21,000   |       
|Proceeds from long-term debt                                                   |                                                     |                                       |                                                     |        |         | 431,050  |       
|Payments of long-term debt                                                     |                                                     |                                       | (3,700                                               | )      |         | (333,525 | )     
|Capital contributions from parent and other                                    |                                                     |                                       |                                                     |        |         | 60,000   |       
|Deferred financing costs                                                       |                                                     |                                       | (315                                                 | )      |         | (16,962  | )     
|Dividends paid to minority interest holders                                    |                                                     |                                       | (500                                                 | )      |         | (1,227   | )     
|                                                                               |                                                     |                                       |                                                      |        |         |          |       
|                                                                               |                                                     |                                       | Net cash (used in) provided by financing activities  |        |         | (12,515  | )     
|                                                                               |                                                     |                                       |                                                      |        |         |          |       
|Effect of exchange rate changes on cash                                        |                                                     |                                       | 576                                                  |        |         | (407     | )     
|                                                                               |                                                     |                                       |                                                      |        |         |          |       
|                                                                               |                                                     |                                       | Net increase (decrease) in cash and cash equivalents |        |         | 11,607   |       
|Cash and cash equivalents                                                      |                                                     |                                       |                                                      |        |         |          |       
|Beginning of year                                                              |                                                     |                                       | 29,721                                               |        |         | 19,022   |       
|                                                                               |                                                     |                                       |                                                      |        |         |          |       
|End of year                                                                    |                                                     | $                                     | 41,328                                               |        | $       | 29,721   |       
|                                                                               |                                                     |                                       |                                                      |        |         |          |       

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

F-6

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Advanstar, Inc.
Notes to Consolidated Financial Statements
December 31, 2004, 2003 and 2002

1.    Nature of Business and Basis of Presentation

The accompanying consolidated financial statements include the accounts of Advanstar, Inc. ("Advanstar"), a wholly owned subsidiary of Advanstar Holdings
Corporation ("Parent" or "Holdings"), and its wholly owned subsidiaries, Advanstar Communications Inc. ("Communications") and Advanstar IH, Inc. ("Advanstar.com"), (collectively, the
"Company"). All intercompany accounts and transactions between consolidated entities have been eliminated.

The
Company operates and manages trade shows and conferences; publishes controlled and paid circulation trade and professional and consumer periodicals; and markets a broad range of
marketing, direct mail and database products and services.

2.    Summary of Significant Accounting Policies



Cash and cash equivalents include cash on deposit and highly liquid investments with original maturities of three months or less. Cash equivalents are stated at
cost, which approximates fair market value.



Prepaid expenses consist primarily of prepaid trade show and conference expenses, prepaid publication production costs and miscellaneous deposits. Event and
publication expenses are charged to operations at the time of the related event and at the time of publication issuance. Other current assets consist primarily of paper inventories.



Property, plant and equipment consisted of the following at December 31:

2004

2003(in thousands of dollars)Land and improvements

$
2,514

$
2,495Buildings


6,310


5,327Furniture, machinery and equipment


45,749


41,113Leasehold improvements


6,502


5,39061,075


54,325Accumulated depreciation


(35,922
)

(29,919
)Property, plant and equipment, net

$
25,153

$
24,406


Property,
plant and equipment is stated at its original cost and is depreciated on a straight-line basis over the following estimated useful lives:

Land improvements

10-15 yearsBuildings

20-40 yearsFurniture, machinery and equipment

3-10 yearsLeasehold improvements

Shorter of useful life or original lease term


Maintenance
and repairs are charged to expense as incurred. Major betterments and improvements, which extend the useful life of the item, are capitalized and depreciated.
The cost and accumulated depreciation of property, plant and equipment retired or otherwise disposed of are removed from the related accounts, and any residual values are charged or credited to
operations.

F-7

---





Trade exhibitor and advertiser lists are amortized on a double-declining balance method over six years and five years, respectively. Subscriber lists and other
intangible assets are amortized on a straight-line basis over three to ten years. Trademarks and trade names are amortized on a straight-line basis over twenty years.



The Company evaluates the carrying value of long-lived assets, including identifiable intangibles, for impairment when events or changes in
circumstances indicate that the carrying amount of an asset may not be recoverable. If impairment indicators are present and the estimated future undiscounted cash flows are less than the carrying
value of the assets, the carrying value is reduced to the estimated fair value as measured by the associated discounted cash flows.

The
Company evaluates goodwill for impairment annually using a two-step test based upon a fair value approach. The first step is used to identify a potential impairment,
while the second step calculates the amount of impairment, if any. Additionally, goodwill is tested for impairment between annual tests if an event occurs or circumstances change that would more
likely than not reduce the fair value of a reporting unit below its carrying value.



Accrued expenses consisted of the following at December 31:

2004

2003(in thousands of dollars)Interest

$
13,084

$
12,958Deposits and customer advances


12,627


11,261Benefits and severance


2,326


2,882Taxes


4,403


4,543Derivative instruments





1,535Other


1,663


2,687$
34,103

$
35,866




Trade show and conference revenue is recognized in the accounting period in which the event is conducted. Subscription revenue is recognized on a pro rata basis
as publications are issued to fulfill the subscription obligations. Advertising revenue is recognized when the publication with the respective advertisement is issued. Custom project contract revenue
with both conference and print elements are deferred and not recognized until all elements are delivered. Deferred revenue is recorded when cash is received in advance of when a trade show event is
held or the publication is issued. Customer advances are recorded when cash is received in anticipation of future advertising unrelated to a specific publication issue.

Deferred
revenue consisted of the following at December 31:

2004

2003(in thousands of dollars)Deferred trade show and conference revenue

$
42,088

$
45,301Deferred advertising and subscription revenue


10,268


11,169Deferred Internet advertising and other revenue


41


83Total deferred revenue

$
52,397

$
56,553


F-8

---





The Company accounts for translation adjustments related to its investments in foreign entities in accordance with SFAS No. 52, Foreign Currency
Translation. Local currencies are considered the functional currencies outside of the U.S. Generally, income and expense items are
translated at average rates of exchange prevailing during the year. For operations in local currency environments, assets and liabilities are translated at year-end exchange rates with
cumulative translation adjustments included as a component of stockholder's equity.



The Company accounts for derivative instruments on the balance sheet at fair value in accordance with SFAS No. 133,Accounting for
Derivative Instruments and Hedging Activities. Changes in the fair value of derivative financial instruments must be recognized currently in earnings unless specific hedge
accounting criteria are met. For those instruments which meet the hedging criteria, gains and losses will be recognized in other comprehensive income rather than in earnings.



As permitted by SFAS No. 123,Accounting for Stock-Based Compensation, the Company has elected to account
for stock options and awards to employees under the provisions of Accounting Principles Board ("APB") Opinion No. 25,Accounting for Stock Issued to
Employees, and related interpretations.

If
the Company had elected to recognize compensation cost based on the fair value of the options granted as prescribed by SFAS No. 123, net loss would have been increased to the
unaudited pro forma amounts indicated in the table below for the years ended December 31:

2004

2003

2002(in thousands of dollarsunaudited)Net lossas reported

$
(67,127
)
$
(70,144
)
$
(118,079
)Less: Pro forma stock-based employee compensation cost


(2,550
)

(2,400
)

(2,133
)Net losspro forma

$
(69,677
)
$
(72,544
)
$
(120,212
)


See
Note 8 for further discussion of the Company's stock compensation plans.



The Company follows the provisions of SFAS No. 130,Reporting Comprehensive Income. This statement
established rules for the reporting of comprehensive income (loss) and its components. Comprehensive income (loss) reflects the change in equity of a business enterprise during a period from
transactions and other events and circumstances from nonowner sources. Comprehensive income (loss) consists of net income (loss), foreign currency translation adjustments and changes in unrealized
loss on derivative financial instruments, and is presented in the accompanying consolidated statements of stockholder's equity.



The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America 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 revenues and expenses during the reporting periods. Ultimate results could differ from these estimates. On an ongoing basis, management reviews its estimates, including those affecting
doubtful accounts, valuation of goodwill and intangible assets, and income taxes. Changes in facts and circumstances may result in revised estimates.

F-9

---





In December 2003, the FASB issued Interpretation No. 46R,Consolidation of Variable Interest
Entities, which addresses accounting for special-purpose and variable interest entities and which superseded Interpretation No. 46. The provisions of Interpretation
No. 46R are effective for the Company in the first quarter of 2005. The Company does not expect the adoption of this standard to have a material effect on its financial position, results of
operations or cash flows.

In
December 2004, the Financial Accounting Standards Board issued SFAS No. 123 R, "Share-Based Payment" which revises SFAS 123 and supersedes APB 25. This statement
establishes standards relating to accounting for transactions in which equity instruments are exchanged for goods or services. Under this statement, the Company must measure the cost of employee
services received in exchange for an award of equity instruments based upon the fair value of the award on the date of grant. This cost must be recognized over the period during which an employee is
required to provide the service (usually the vesting period). The Company is required to adopt the provisions of this standard effective January 1, 2006. The Company is currently evaluating the
impact of this standard. The adoption of this standard will result in an increase in compensation expense and an increase to net loss.

3.    Goodwill and Other Intangible Assets

Effective January 1, 2002, the Company adopted SFAS No. 142, which established new standards related to how acquired goodwill and indefinite-lived
intangible assets are to be recorded upon their acquisition as well as how they are to be accounted for after they have been initially recognized in the financial statements.

Effective
with the adoption of this standard, the Company no longer amortizes goodwill. Instead, SFAS No. 142 requires acquired goodwill to be periodically evaluated for
impairment. Upon adoption of the standard, the Company engaged an appraiser to assist in completing a transitional impairment test for its acquired goodwill using a discounted cash flow model. As a
result of the impairment analysis, the Company recorded a goodwill impairment charge of $70.9 million in the first quarter of 2002. After minority interest effect of $4.1 million, the
net charge was $66.8 million. This charge was attributable to an impairment of the carrying value of goodwill in the Company's trade show operating segment which management believes resulted
from a slow-down in the economy and its associated impact on the trade show business. The net charge of $66.8 million was reported as a cumulative effect of a change in accounting
principle. There was no income tax effect associated with this impairment charge.

On
a prospective basis, the Company is required to test acquired goodwill on an annual basis based upon a fair value approach. Additionally, goodwill shall be tested for impairment
between annual tests if an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying value.

On
July 1, 2003 and 2004, the Company engaged an appraiser to assist in completing its annual goodwill impairment test of each of its three reporting units. Based on this
valuation, which utilized a discounted cash flow method, there was no impairment of goodwill indicated.

F-10

---



The changes in the carrying amount of goodwill for the year ended December 31, by operating segment, are as follows:

|                                                         |  | Trade Shows
and
Conferences |         | Trade
Publications |   | Direct
Marketing
Products
and Other |   | Totals |       
|-------------------------------------------------------- |  | --------------------------- | ------- | ------------------ | - | ----------------------------------- | - | ------ | ------
|
|Balances at December 31, 2002                            |  | $                           | 456,940 |                    | $ | 133,725                             |   | $      | 30,840
|Goodwill acquired or finally allocated during the period |  |                             | (1,017  | )                  |   | 75,685                              |   |        |      
|Goodwill allocated to business disposition               |  |                             | (787    | )                  |   | (639                                | ) |        |      
|Foreign currency translation                             |  |                             | 2,773   |                    |   | 1,672                               |   |        | 29    
|                                                         |  |                             |         |                    |   |                                     |   |        |       
|Balances at December 31, 2003                            |  |                             | 457,909 |                    |   | 210,443                             |   |        | 30,869
|Goodwill acquired or finally allocated during the period |  |                             | 247     |                    |   | 6,272                               |   |        |      
|Goodwill allocated to business disposition               |  |                             |        |                    |   | (900                                | ) |        |      
|Foreign currency translation                             |  |                             | 2,274   |                    |   | 640                                 |   |        | 2     
|                                                         |  |                             |         |                    |   |                                     |   |        |       
|Balances at December 31, 2004                            |  | $                           | 460,430 |                    | $ | 216,455                             |   | $      | 30,871
|                                                         |  |                             |         |                    |   |                                     |   |        |       

Intangible
and other assets consist of the following at December 31:

2004

2003Trade exhibitor lists

$
155,721

$
155,043Advertiser lists


60,943


62,303Subscriber lists


29,145


28,577Trade names and trademarks


17,996


18,008Other intangible assets


24,405


21,323Deferred financing costs


23,379


23,063311,589


308,317Accumulated amortization


(209,776
)

(165,926
)Total intangible and other assets, net

$
101,813

$
142,391


The
allocated fair value of intangible assets acquired during 2004 and 2003 was as follows:

2004

2003(in thousands of dollars)Trade exhibitor lists

$


$
Advertiser lists





24,419Subscriber lists


789


5,091Trade names and trademarks


97


17,948Other intangible assets


1,566


14,752$
2,452

$
62,210


Estimated
amortization expense of intangible assets for the next five years is as follows:

(in thousands of dollars)2005

$
37,7532006


27,2952007


11,5332008


8,0372009


3,912


F-11

---



4.     Restructuring Activity

The Company integrated many of the sales, marketing, technology and operating functions of its wholly owned subsidiary Advanstar.com, Inc.
("Advanstar.com") with Communications and its core activities in publishing, trade shows and direct marketing products. These restructuring activities were completed by the end of 2001, except for
facility lease costs, which continue through June 2010, including leasehold improvements from the facility Advanstar.com vacated. At December 31 2003, there was a $6.2 million
accrual for remaining facility closure costs, of which $0.6 million is included in accrued liabilities and approximately $5.6 million is included in other long-term
liabilities in the accompanying consolidated balance sheet. The facility lease obligation was settled in May 2004 for less than amounts owed under the lease. An $4.0 million favorable
settlement (net of fees and related expenses) of the lease obligation was recognized as an offset to operating expenses in 2004. No liability existed as of December 31, 2004 relating to this
restructuring.

In
September 2003, the Company consolidated its midtown New York leased office space from two floors to one. These actions resulted in a third quarter charge of approximately
$2.1 million. In December 2003, the Company consolidated its Chester, U.K. leased office space, resulting in a fourth quarter charge of approximately $0.6 million. These charges
included the present value of future facility rental payments, net of sublease income, of $2.3 million and other relocation costs and expenses of $0.4 million. The Company will continue
to pay facility lease costs, net of sublease income, associated with the previously used facilities through August 2015. The balance of the accrual for these costs at December 31, 2004,
and 2003 is $1.8 million and $2.4 million which principally represents remaining facility lease costs, of which $0.5 million is included in accrued liabilities at
December 31, 2004 and 2003,
and $1.3 million and $1.9 million is included in other long-term liabilities at December 31, 2004 and 2003 in the accompanying consolidated balance sheet.

5.     Acquisitions and Divestitures



All acquisitions have been accounted for using the purchase method of accounting and, accordingly, the assets acquired and liabilities assumed have been recorded
at their fair values as of the dates of the acquisitions. The excess of the purchase price over the fair value of the assets acquired and liabilities assumed has been recorded as goodwill. Results of
operations for these acquisitions have been included in the accompanying consolidated financial statements since their respective dates of acquisition. Any divestiture where the Company has
significant continuing involvement are included in continuing operations in accordance with Emerging Issues Task Force (EITF) Issue No. 03-13.

On
January 9, 2002, the Company acquiredAIIM International Exposition and Conferencefor approximately $11.9 million in
cash.

On
October 3, 2002, the Company acquiredHTthe Magazine for Healthcare Travel Professionalsfor approximately
$11.1 million in cash.

During
2002, the Company completed two other acquisitions of publishing properties with a cumulative purchase price of $1.0 million in cash.

During
2003, the Company acquired intangible assets, primarily customer relationships, for $0.7 million in cash. The Company also paid an additional $0.5 million contingent
purchase price related to its 2002 acquisition ofHTthe Magazine for Healthcare Travel Professionals.

On
October 1, 2003, the Company purchased a portfolio of healthcare industry magazines and related custom service projects from the Thomson Corporation and its subsidiaries
("Thomson") for $150.7 million, including $136.5 million in cash (including related fees and expenses) and $14.1 million of liabilities assumed.

F-12

---



The
following table summarizes the estimated fair value of the assets acquired and liabilities assumed in the Thomson acquisition at October 1, 2003:

(in thousands of dollars)Current assets

$
12,878Property, plant and equipment


1,233Intangible assetsAdvertiser lists


23,842Subscriber lists


5,091Trade names and trademarks


17,948Noncompetition agreement


13,591Other intangible assets


957Goodwill


75,110Total assets acquired


150,650Current liabilities


14,111Total liabilities assumed


14,111Net assets acquired

$
136,539


The
$61.4 million of intangible assets related to Thomson have a weighted average useful life of approximately nine years. All goodwill acquired is expected to be
deductible for tax purposes.

Current
liabilities of $14.1 million were assumed, including approximately $1.0 million of severance costs pursuant to the Company's plan to sever certain employees of
Thomson. All affected employees were severed as of December 31, 2003. The remaining balance of accrued severance at December 31, 2004 and 2003, was $0.1 million and
$1.0 million, respectively. All remaining severance liability, as of December 31, 2004, will be paid in 2005.

On
March 8, 2004, the Company purchased a portfolio of pharmaceutical industry conferences and magazines from the Institute of Validation Technology, Inc. ("IVT") for
$7.9 million in cash. In addition, the Company will pay additional contingent cash consideration to the former shareholders based on 2004 and 2005 operating results of the acquired assets and
their continued employment with the Company. As of December 31, 2004, the Company has accrued $1.5 million based upon 2004 operating results, of which $1.0 million is included in
other accrued liabilities and $0.5 million is included in other long-term liabilities in the accompanying consolidated balance sheet at December 31, 2004.

The
following are the Company's unaudited pro forma operating results as if the Thomson acquisition had taken place at January 1, 2002. The unaudited pro forma operating results
related to all other acquisitions discussed above were immaterial.

2003

2002(in thousands of dollarsunaudited)Revenue

$
372,361

$
379,338Loss from continuing operations before cumulative effect of accounting change


(85,990
)

(59,916
)Net loss


(83,497
)

(126,826
)


The
unaudited pro forma operating results do not purport to represent what the Company's results of operations actually would have been if the acquisition had occurred as
of the date indicated or what such results will be for any future periods.

F-13

---





The results of the following divestitures have been reported in discontinued operations in the consolidated statements of operations for the years ended
December 31, 2004, 2003 and 2002. In addition, the assets and liabilities related to these divestitures are reported in discontinued operations in the consolidated balance sheet at
December 31, 2003. Any divestiture where the Company has continued involvement are included in continuing operations in accordance with Emerging Issues Task Force (EITF) regarding Issue
No. 03-13.



On March 12, 2004, the Company completed the sale of its art industry trade shows and magazines (the "Art Group") for a total selling price of
$19.6 million in cash. The portfolio included three trade shows and two publications. The Company recorded a gain on the sale of $1.0 million plus a tax benefit of $2.4 million.

Revenues
of the Art Group, included in discontinued operations in the consolidated statements of operations, for the period from January 1, 2004 to March 12, 2004, and for
the years ended December 31, 2003 and 2002, were $8.5 million, $10.9 million and $9.6 million, respectively.



On August 5, 2004, the Company completed the sale, for a total selling price of $3.1 million in cash, of its 65% ownership in its French joint
venture ("SeCA"), which consisted of one trade show. In
connection with the sale, the Company recorded a goodwill impairment charge of $9.4 million, net of minority interest, in the second quarter of 2004. The amount of the impairment charge was
determined based upon the excess of the carrying value of the Company's interest in SeCA over the selling price, less the costs incurred by the Company to sell SeCA. This charge is reported separately
as a component of discontinued operations for the year ended December 31, 2004.

Revenues
of SeCA, included in discontinued operations in the consolidated statements of operations, for the period from January 1, 2004 to August 5, 2004 and for the years
ended December 31, 2003 and 2002 were $2.9 million, $4.1 million and $5.7 million, respectively.



On September 8, 2004, the Company sold its German trade show business ("DMS") for $1.7 million in cash. In connection with the sale, the Company
recorded a goodwill impairment charge of $6.2 million in the third quarter of 2004. The amount of the impairment charge was determined based upon the excess of the carrying value of DMS over
the selling price, less the costs incurred by the Company to sell DMS. This charge is reported as a component of discontinued operations for the year ended December 31, 2004.

Revenues
of DMS, included in discontinued operations in the consolidated statements of operations, were for the period from January 1, 2004 to September 8, 2004, and for
the years ended December 31, 2003 and 2002 were, $0.1 million, $2.0 million and $2.3 million, respectively.

F-14

---



The
financial results of the Art Group, SeCA and DMS included in the discontinued operations in the accompanying consolidated statements of operations for the years ended
December 31, 2004, 2003 and 2003 are as follows:

2004

2003

2002(in thousands of dollars)(Loss) income before income taxes (including goodwill impairment charge and gain on sale)

$
(16,559
)
$
2,755

$
987Income tax (benefit) provision


(1,990
)

2,442


782Minority interests


4,826


(224
)

(298
)Net (loss) income


(9,743
)

89


(93
)


The
amount of goodwill associated with the businesses to be disposed of was determined based on the relative fair values of the businesses to be disposed of and the
portion of the reporting units that will be retained. For businesses to be disposed of that were never integrated into the reporting units, the carrying amount of that acquired goodwill is included in
the carrying amount of the businesses to be disposed of.

The
Art Group, SeCA and DMS goodwill included in gain/loss on discontinued operations and the goodwill impairment charge included in discontinued operations in the Company's reportable
segments for the year ended December 31, 2004 (in thousands) are as follows:

|                                                             |  | Trade Shows
and
Conferences |        | Trade
Publications |   | Direct
Marketing
Products
and Other |  | Corporate |   | Total
|------------------------------------------------------------ |  | --------------------------- | ------ | ------------------ | - | ----------------------------------- |  | --------- | - | -----
|Goodwill included in gain on sale of discontinued operations |  | $                           | 19,287 |                    | $ | 3,346                               |  | $         |  |      
|Goodwill impairment included in discontinued operations      |  |                             | 20,108 |                    |   | 534                                 |  |           |  |      

The
goodwill impairment charge of $20.6 million above does not include the effect of minority interest. After minority interest effect of $5.1 million, the net
charge was $15.6 million.

The
discontinued operations of the Art Group, SeCA and DMS included in the consolidated balance sheets as of December 31, 2003 are as follows:

|            |                                             | (in thousands of dollars)                             
|----------- | ------------------------------------------- | ------------------------------------------------------
|Assets      |                                             |                                                       
|            | Accounts receivable                         |                                                       
|            | Prepaid expenses                            |                                                       
|            |                                             |                                                       
|            |                                             | Total current assets of discontinued operations       
|            | Property, plant and equipment, net          |                                                       
|            | Goodwill                                    |                                                       
|            | Intangibles and other, net                  |                                                       
|            |                                             |                                                       
|            |                                             | Total non current assets of discontinued operations   
|Liabilities |                                             |                                                       
|            | Accounts payable and other accrued expenses |                                                       
|            | Deferred revenue                            |                                                       
|            |                                             |                                                       
|            |                                             | Total current liabilities of discontinued operations  
|            | Deferred income taxes                       |                                                       
|            | Minority interests                          |                                                       
|            |                                             |                                                       
|            |                                             | Total long term liabilities of discontinued operations
|            |                                             |                                                       
|            |                                             |                                                       
|            |                                             |                                                       

F-15

---



The Art Group, SeCA and DMS assets included in discontinued operations in the Company's reportable segments at December 31, 2003 (in thousands) are as follows:

|               |  | Trade Shows
and
Conferences |        | Trade
Publications |   | Direct
Marketing
Products
and Other |  | Corporate |   | Total
|-------------- |  | --------------------------- | ------ | ------------------ | - | ----------------------------------- |  | --------- | - | -----
|Segment assets |  | $                           | 45,167 |                    | $ | 3,908                               |  | $         |  |      

6.     Financial Derivative Instruments

The Company periodically uses derivative instruments to manage exposure to interest rate and foreign currency risks. The Company's objectives for holding
derivatives are to minimize the risks using the most effective methods to eliminate or reduce the impact of these exposures.



Variable rate debt instruments are subject to interest rate risk. In 2001, the Company entered into an interest rate collar agreement expiring
February 2004, to manage its exposure to interest rate movements on a portion of its variable rate debt obligations. The effective portion of the cumulative gain or loss on interest rate collar
agreement is reported as a component of accumulated other comprehensive income in stockholder's equity and is recognized in earnings as the underlying interest expense is incurred. The ineffective
portion of the interest rate collar and swap agreements is recognized in current earnings. The Company uses a portion of these agreements as hedges of the Company's second priority senior secured
floating rate notes described below. Gains and losses on the undesignated portion of these agreements at the end of each fiscal quarter (which are calculated as the net amount payable upon termination
at the date of determination), will be recognized in current earnings until expired.

In
May 2003, the Company entered into an interest rate swap agreement expiring November 2005, and subsequently terminated the agreement in December 2003. The net
gain at termination of approximately $0.2 million will continue to be reported in accumulated other comprehensive income and amortized into earnings over the original contract term.

In
connection with Communications' private placement of $360 million of second priority senior secured notes in August 2003 and the use of proceeds therefrom to repay and
terminate all outstanding term A loans under its credit facility and all but $25.0 million of the outstanding term B loans under its credit facility (Note 7), the Company reclassified
approximately $1.8 million of deferred losses previously reported as a component of accumulated other comprehensive income into other expense in the quarter ended September 30, 2003.



The Company periodically uses forward contracts to manage its exposure associated with forecasted international revenue and expense transactions denominated in
euro, British Pound Sterling and the Brazilian Real for up to 15 months in the future. Changes in the fair value of these instruments are reported as a component of accumulated other
comprehensive income in stockholder's equity and are recognized in earnings as the underlying revenue is recognized. Forward contracts not designated as hedging instruments under SFAS No. 133
are also used to manage the impact of the variability in exchange rates. Changes in the fair value of these foreign exchange contracts are recognized in current earnings.

At
December 31, 2004, the Company had no foreign exchange derivative contracts.

F-16

---





The following table summarizes the effects of SFAS No. 133 on the Company's accumulated other comprehensive income at December 31, 2004 and 2003:

Interest Rate
Collar
Agreements

Foreign
Exchange
Contracts

Total(in thousands of dollars)Accumulated other comprehensive loss balance at December 31, 2002

$
(4,350
)
$


$
(4,350
)Unwound from accumulated other comprehensive income during the period


5,739





5,739Mark to market hedge contracts


(1,431
)




(1,431
)Accumulated other comprehensive loss balance at December 31, 2003


(42
)




(42
)Unwound from accumulated other comprehensive income during the period


(99
)




(99
)Mark to market hedge contracts


244





244Accumulated other comprehensive income balance at December 31, 2004

$
103

$


$
103


At
December 31, 2004, the Company will reclassify out of accumulated other comprehensive income approximately $0.1 million of deferred gains into earnings within the next
12 months.

The
Company had no derivatives in the consolidated balance sheet as of December 31, 2004. As of December 31, 2003, the fair value of the Company's derivatives was a net
liability position of $1.5 million included in accrued liabilities, in the accompanying consolidated balance sheet.



The following tables summarize the effects of SFAS No. 133 on the Company's statement of operations related to the ineffective portion of the Company's
interest rate collar agreements and changes in the fair value of foreign exchange contracts not designated as hedging instruments for the years ended December 31, 2004 and 2003:

|                                                  |  | Interest Rate
Collar
Agreements |       | Foreign
Exchange
Contracts |   | Total
|------------------------------------------------- |  | ------------------------------- | ----- | -------------------------- | - | -----
|
|Year ended December 31, 2004                      |  |                                 |       |                            |   |      
|Other income (expense)                            |  | $                               | 1,319 |                            | $ | 71   
|                                                  |  |                                 |       |                            |   |      
|Total statement of operations impact before taxes |  | $                               | 1,319 |                            | $ | 71   
|                                                  |  |                                 |       |                            |   |      
|Year ended December 31, 2003                      |  |                                 |       |                            |   |      
|Other income (expense)                            |  | $                               | 1,178 |                            | $ | (96  
|                                                  |  |                                 |       |                            |   |      
|Total statement of operations impact before taxes |  | $                               | 1,178 |                            | $ | (96  
|                                                  |  |                                 |       |                            |   |      

7.     Debt



Prior to the August 2003 transactions described below, the credit facility (the "Credit Facility") consisted of (i) $415.0 million of term
loans A and B payable in quarterly installments through October 11, 2008, and (ii) $80.0 million of revolving loan availability through April 11, 2007. The Credit

F-17

---



Facility
contained restrictive covenants, which required the Company to, among other things, maintain a minimum fixed charge coverage ratio and maximum quarterly leverage ratio (as defined).

In
connection with the Company's private placement in August 2003, described below, the Company repaid all term A loans, all but $25.0 million term B loans, and a portion
of the revolving credit borrowings under the Credit Facility. The Company also amended its Credit Facility to reduce the
revolving loan availability from $80.0 million to $60.0 million, eliminate the leverage ratio covenant and amend certain other covenants.

Failure
to comply with current covenants may cause an event of default under the credit facility. Borrowings under the Credit Facility are collateralized by substantially all of the
Company's assets. At December 31, 2004, the Company had $59.1 million of borrowings available under the Credit Facility.



On August 18, 2003, Communications issued $360.0 million of second priority senior secured notes (the "August senior secured notes"). On
September 25, 2003, Communications issued an additional $70.0 million of second priority senior secured notes (the "September senior secured notes"), which were issued at a premium
(together with the August senior secured notes, the "Senior Secured Notes"). The Senior Secured Notes were issued in two tranches: $130.0 million of Second Priority Senior Secured Floating Rate
Notes due 2008, which will require quarterly amortization equal to 0.25% of the principal amount thereof (the "floating rate notes"), and $300.0 million of 10.75% Second Priority Senior Secured
Notes due 2010. Interest on the floating rate notes is payable at a rate equal to three-month LIBOR, which is reset quarterly, plus 7.5%. Each tranche of the notes is collateralized by second priority
liens on substantially all the collateral pledged against borrowings under Communications' Credit Facility (other than the capital stock of certain of its subsidiaries and assets of its parent
companies, including Advanstar). The notes contain restrictive covenants that, among other things, limit Communications' ability to incur debt, pay dividends and make investments. Communications
entered into a registration rights agreement in connection with the private placement pursuant to which the Company has registered substantially all of the notes under the Securities Act of 1933, as
amended.

Communications
used the net proceeds from the August senior secured notes offering to repay and terminate all outstanding term A loans under the Credit Facility and all but
$25.0 million of the outstanding term B loans and a portion of its revolving credit borrowings under the Credit Facility. Communications used the net proceeds of the September senior secured
notes offering to acquire a portfolio of healthcare industry magazines and related custom service projects from the Thomson Corporation (Note 5).

The
Senior Secured Notes are fully and unconditionally guaranteed on a senior basis, jointly and severally, by the Communications' wholly owned domestic subsidiaries. The financial
covenants under the notes include limitations on certain asset dispositions, payments, debt incurrence, dividends and other restricted payments.



Communications' $160.0 million unsecured, 12% senior subordinated notes due 2011 (the "Senior Subordinated Notes") bear interest payable semiannually on
February 15 and August 15 of each year. The Senior Subordinated Notes are fully and unconditionally guaranteed on a senior subordinated basis, jointly and severally, by Communications'
wholly owned domestic subsidiaries. The financial covenants under the Senior Subordinated Notes include limitations on certain asset dispositions, payments, debt incurrence, dividends and other
restricted payments.

F-18

---



The
Company's senior discount notes due October 2011 (the "Discount Notes") with a principal amount at maturity of $171.8 million bear interest at 15%, payable semiannually
beginning October 2005, and have an implied yield to maturity of approximately 17.2%. The notes are redeemable at the Company's option at specified premiums through 2007 and at par thereafter.
The notes may also be redeemed at a premium upon a qualifying change of control of the Company.

The
Discount Notes do not require cash interest payments until 2006 and contain restrictive covenants that, among other things, limit Advanstar's ability and that of its subsidiaries to
incur debt, pay dividends and make investments. Since Advanstar is a holding company and its subsidiaries serve as its only source of cash flow, its ability to pay interest on these notes will be
dependent upon the receipt of dividends from its subsidiaries. The Credit Facility, the Senior Secured Notes and the Senior Subordinated Notes impose substantial restrictions on
Advanstar, Inc.'s subsidiaries' ability to pay dividends to Advanstar, Inc. Additionally, the Discount Notes are not guaranteed by Advanstar's subsidiaries.

Accretion
of the debt discount on the Discount Notes was approximately $21.1 million, $17.9 million and $15.2 million during the years ended December 31,
2004, 2003 and 2002, respectively. These amounts are included in interest expense in the respective accompanying consolidated statements of operations.

Long-term
debt consists of the following at December 31:

|                                                                                                                                                             |  | 2004 |         | 2003 |  
|------------------------------------------------------------------------------------------------------------------------------------------------------------ |  | ---- | ------- | ---- | -
|
|Term loan B, interest at LIBOR plus 4.50%; 6.92% at December 31, 2004, due quarterly through October 11, 2008                                                |  | $    | 25,000  |      | $
|Revolving credit loan, interest at LIBOR plus 3.75%; due April 11, 2007                                                                                      |  |      |        |      |  
|Second priority senior secured floating rate notes, interest at LIBOR plus 7.50%, 9.79% at December 31, 2004, due 2008                                       |  |      | 128,375 |      |  
|10.75% Second priority senior secured notes, due 2010, plus unamortized premium of $844 and $994 at December 31, 2004 and 2003, respectively                 |  |      | 300,844 |      |  
|12% Senior subordinated notes, due 2011                                                                                                                      |  |      | 160,000 |      |  
|Senior discount notes, interest at 15%, due October 11, 2011, net of unamortized discount of $33,692 and $53,790 at December 31, 2004 and 2003, respectively |  |      | 139,100 |      |  
|Acquisition note payable, interest at 5.5%, due monthly through 2004                                                                                         |  |      |        |      |  
|Acquisition note payable, interest at 6.0%, due April 1, 2004                                                                                                |  |      |        |      |  
|                                                                                                                                                             |  |      |         |      |  
|                                                                                                                                                             |  |      | 753,319 |      |  
|Less: Current maturities                                                                                                                                     |  |      | (1,300  | )    |  
|                                                                                                                                                             |  |      |         |      |  
|                                                                                                                                                             |  | $    | 752,019 |      | $
|                                                                                                                                                             |  |      |         |      |  

Based
on the borrowing rates currently available to the Company for debt instruments with similar terms and average maturities, the fair value of long-term debt exceeded its
carrying value by $55.6 million and $49.1 million at December 31, 2004 and 2003.

Cash
paid for interest for the years ended December 31, 2004, 2003 and 2002, was approximately $67.2 million, $51.1 million and $49.1 million, respectively.

F-19

---



Annual maturities of long-term debt for the next five years (excluding amortization of premium) are as follows:

(in thousands of dollars)2005

$
1,3002006


1,3002007


1,3002008


149,4752009


Thereafter


632,792$
786,167


8.    Stockholder's Equity



On October 12, 2000, Holdings adopted the 2000 Management Incentive Plan. A maximum of 4,047,789 shares of Holdings are authorized for grant to
participants under the 2000 Management Incentive Plan. Options are granted by Holdings' board of directors at an exercise price of not less than the fair value of Holdings common stock at the date of
grant and vest over a maximum of nine years. Shares available for grant under the 2000 Management Incentive Plan totaled 222,789 at December 31, 2004.

For
purposes of computing pro-forma compensation cost of stock options granted, as summarized in Note 2, the fair value of each stock option grant was estimated on the
date of grant using the Black-Scholes option pricing model with the following weighted average assumptions for each of the years ended December 31:

2004

2003

2002Expected dividend yield





Expected stock price volatility

42.3
%
36.0
%
37.6
%Risk-free interest rate

3.6
%
3.8
%
5.0
%Expected life of options

5.0 years

7.0 years

7.0 years


The
Company uses comparable public companies in its industry for estimating its expected stock price volatility. The Company has not declared or paid any cash dividends in the past.
Under terms of the Company's Credit Facility, the Company is prohibited from paying cash dividends without prior approval of the lenders, as defined in the Credit Facility.

F-20

---



A
summary of stock option activity under the Plan and the 2000 Management Incentive Plan is as follows:

Options
Outstanding

Weighted
Average
Exercise
PriceOutstanding at December 31, 2001

2,925,000

$
10.00Granted

575,000


10.00Cancelled

(256,250
)

10.00Outstanding at December 31, 2002

3,243,750


10.00Granted

600,000


10.00Outstanding at December 31, 2003

3,843,750


10.00Granted

256,250


10.00Cancelled

(275,000
)

10.00Outstanding at December 31, 2004

3,825,000


10.00


At
December 31, 2004 and 2003, the outstanding stock options had a weighted average remaining contractual life of 6.83 years and 7.6 years, respectively, and an
exercise price of $10.00 per option. Of the options outstanding at December 31, 2004 and 2003, 2,230,798 and 1,596,600 respectively, were exercisable. The weighted average fair value of grants,
as estimated using the Black-Scholes option pricing model, for the years ended December 31, 2004, 2003 and 2002, was $5.24, $5.34 and $5.42 per option, respectively.

9.    401(k) Plan

The Company has a 401(k) savings plan and trust (the "401(k) Plan") available to employees of Advanstar, Inc. and its domestic subsidiaries. All domestic
employees who have completed one year of service and are at least 21 years of age are eligible to participate in the 401(k) Plan. The Company is required to make a matching contribution to the
401(k) Plan and may also make discretionary contributions to the 401(k) Plan. Eligible employees are vested 100% in their own contributions. Contributions made by the Company vest in equal
installments over five years. Total contribution expense was $1.6 million for the year ended December 31, 2004, $1.2 million for each of the years ended December 31, 2003
and 2002.

10.    Income Taxes

The Company's taxable income or loss is included in the consolidated federal income tax return of Holdings. Federal income taxes are paid to or refunded by the
Parent pursuant to the terms of a tax sharing agreement under which taxes approximate the amount that would have been computed on a separate company basis. Taxes payable to the Parent of approximately
$0.1 million at December 31, 2004 and 2003 are included in due from Parent in the accompanying consolidated balance sheets.

Cash
paid for income taxes for the years ended December 31, 2004, 2003 and 2002, was approximately $0.2 million, $0.3 million and $0.8 million, respectively.

F-21

---



The
summary of loss from continuing operations before provision (benefit) for income taxes, minority interests and accounting change were as follows for the years ended
December 31:

2004

2003

2002(in thousands of dollars)Domestic

$
(43,070
)
$
(60,424
)
$
(54,378
)Foreign


202


(5,123
)

(679
)$
(42,868
)
$
(65,547
)
$
(55,057
)


The
provision (benefit) for income taxes is comprised of the following for the years ended December 31:

2004

2003

2002(in thousands of dollars)CurrentFederal

$


$


$
(937
)State


7





59Foreign


283


(303
)

1,106Deferred


13,664


4,586


(4,292
)Total provision (benefit)

$
13,954

$
4,283

$
(4,064
)


The
Company accounts for income taxes following the provisions of SFAS No. 109,Accounting for Income Taxes, which requires
recognition of deferred tax assets and liabilities for the expected future tax consequences of differing amounts that have been included in the financial statements or tax returns. Under this method,
deferred tax assets and liabilities are determined based on the difference between the financial statement and tax bases of assets and liabilities using currently enacted tax rates.

F-22

---



Significant
components of the Company's deferred income taxes were as follows at December 31:

2004

2003(in thousands of dollars)Net current deferred tax assetAccrued expenses and other

$
7,927

$
7,882Prepaid and other


(372
)

(3,196
)Total net current deferred tax asset


7,555


4,686Net noncurrent deferred tax assetProperty, plant and equipment


777


1,587Identifiable intangible assets


16,012


5,238Goodwill


(18,250
)

(4,586
)U.S. net operating loss carryforwards


41,878


29,933Foreign jurisdiction net operating loss carryforwards


10,744


7,616Financial derivatives


(419
)

1,075Debt discount


17,089


11,793AMT credit carryforwards


453


453Total net noncurrent deferred tax asset


68,284


53,109Valuation allowance


(94,089
)

(62,381
)Net deferred income tax liabilities

$
(18,250
)
$
(4,586
)


The
Company has established a valuation allowance to offset all of these net deferred tax assets. The amortization of goodwill for income tax purposes resulted in the reduction in tax
basis of goodwill to a tax effected amount of $18.3 million and $4.6 million less than the carrying value of goodwill for financial reporting purposes at December 31, 2004 and
2003. Because goodwill is not amortized for financial reporting purposes, the Company has established a deferred tax liability equal to this basis difference and has increased the valuation allowance
by the same amount.

At
December 31, 2004 and 2003, the Company had net operating loss carryforwards of approximately $134.5 million and $97.5 million, respectively. Of these losses,
approximately $26.9 million and $19.0 million are related to losses generated by the Company's operations in foreign tax jurisdictions whose use are subject to the tax laws of such
foreign jurisdictions and will be limited by the ability of such foreign entities to generate taxable income. Of the total operating loss carryforwards, approximately $26.9 million have no
expiration date and approximately $107.6 million expire at various dates beginning in 2021.

F-23

---



A reconciliation of the Company's benefit for income taxes at the federal statutory rate to the reported income tax provision (benefit) is as follows:

|                                      |  |   |         |   |   | 2002    |  
|------------------------------------- |  | - | ------- | - | - | ------- | -
|
|
|Income tax benefit at statutory rates |  | $ | (15,004 | ) | $ | (21,977 | )
|Nondeductible goodwill impairment     |  |   |        |   |   |        |  
|Change in valuation allowance         |  |   | 27,580  |   |   | 28,831  |  
|State taxes, net of federal benefit   |  |   | (1,072  | ) |   | (1,570  | )
|Nondeductible interest                |  |   | 2,616   |   |   | 2,220   |  
|Foreign rate differential             |  |   | 213     |   |   | (568    | )
|Other, net                            |  |   | (379    | ) |   | (2,653  | )
|                                      |  |   |         |   |   |         |  
|Provision (benefit) for income taxes  |  | $ | 13,954  |   | $ | 4,283   |  
|                                      |  |   |         |   |   |         |  

The
change in valuation allowance for the year ended December 31, 2004 excludes a $4.1 million valuation allowance established to offset foreign jurisdiction net operating
loss carryforwards that were also recorded in the year ended December 31, 2004.

11.   Commitments and Contingencies



The Company has long-term operating leases for office space and office equipment. The leases generally require the Company to pay maintenance,
insurance, taxes and other expenses in addition to minimum annual rentals. Building and equipment rent expense, including an allocation of certain facility operating expenses, was $9.7 million,
$7.8 million and $7.4 million for the years ended December 31, 2004, 2003 and 2002, respectively. Future minimum rent commitments under operating leases with initial terms of one
year or more are as follows:

(in thousands of dollars)2005

$
7,0742006


6,3712007


5,1302008


4,5592009


3,046Thereafter


1,729




The Company is a defendant in legal proceedings arising in the ordinary course of business. Based on information presently available, management has determined
that the accruals for these routine actions and claims are adequate. Although recorded accruals include management's best estimates, the resolution of these matters and can not be predicted with
certainty. Management believes, however, that it is unlikely that any identified matters, either individually or in the aggregate, will have a material adverse effect on the Company's results of
operations or financial position.

F-24

---



12.   Segments

The Company follows the provisions of SFAS No. 131,Disclosures about Segments of an Enterprise and Related Information,and has
three reportable segments: trade shows and conferences, trade publications, and direct marketing products and other. The trade show and conference segment allows
exhibitors a cost-effective means to showcase and sell products and services, while developing business relationships with potential customers. The Company's trade publications segment
provides new product and educational information to readers and allows advertisers to reach highly targeted and select business audiences. The direct marketing products and other segment offers
customers mailing lists from the Company's subscriber and attendee databases; editorial and advertising reprints; direct mail postcards; and classified, recruitment and industry directory advertising.

The
Company evaluates the performance of, and allocates resources to, its segments based on contribution margindefined as net revenue less cost of production and selling,
editorial, and circulation costs (excluding depreciation), which is a non-GAAP measure. The accounting policies of the reportable segments are the same as those described in the summary of
significant accounting policies. There are no intersegment sales or transfers. Segment assets are primarily intangible assets, prepaid expenses and accounts receivable. Revenues, contribution margins
and segment assets of the Company's three reportable segments are as follows:

|                             |                            | Trade Shows
and
Conferences |   | Trade
Publications |  | Direct
Marketing
Products
and Other |         | Corporate |   | Total 
|---------------------------- | -------------------------- | --------------------------- | - | ------------------ |  | ----------------------------------- | ------- | --------- | - | ------
|
|Year ended December 31, 2004 |                            |                             |   |                    |  |                                     |         |           |   |       
|                             | Revenues                   |                             | $ | 151,483            |  | $                                   | 206,147 |           | $ | 22,841
|                             | Contribution margin (loss) |                             |   | 75,775             |  |                                     | 59,368  |           |   | 11,572
|                             | Segment assets             |                             |   | 502,663            |  |                                     | 293,399 |           |   | 33,848
|Year ended December 31, 2003 |                            |                             |   |                    |  |                                     |         |           |   |       
|                             | Revenues                   |                             |   | 142,063            |  |                                     | 147,864 |           |   | 19,035
|                             | Contribution margin (loss) |                             |   | 69,215             |  |                                     | 45,213  |           |   | 8,265 
|                             | Segment assets             |                             |   | 563,055            |  |                                     | 279,792 |           |   | 33,349
|Year ended December 31, 2002 |                            |                             |   |                    |  |                                     |         |           |   |       
|                             | Revenues                   |                             |   | 145,961            |  |                                     | 127,385 |           |   | 18,490
|                             | Contribution margin (loss) |                             |   | 76,384             |  |                                     | 35,538  |           |   | 7,512 
|                             | Segment assets             |                             |   | 586,406            |  |                                     | 183,954 |           |   | 32,599

The
reconciliation of total segment contribution margin to consolidated loss from continuing operations before taxes, minority interest and cumulative effect of accounting change is as
follows for the years ended December 31:

|                                   |                                                                                                      | 2004 |         | 2003    |   | 2002    |        
|---------------------------------- | ---------------------------------------------------------------------------------------------------- | ---- | ------- | ------- | - | ------- | -------
|
|Total segment contribution margin  |                                                                                                      | $    | 140,082 |         | $ | 117,284 |        
|General and administrative expense |                                                                                                      |      | (45,817 | )       |   | (35,310 | )      
|Restructuring charge               |                                                                                                      |      | 4,015   |         |   | (2,692  | )      
|Depreciation and amortization      |                                                                                                      |      | (50,170 | )       |   | (57,721 | )      
|Other expense (primarily interest) |                                                                                                      |      | (90,978 | )       |   | (87,108 | )      
|                                   |                                                                                                      |      |         |         |   |         |        
|                                   | Consolidated loss before income taxes, minority interests and cumulative effect of accounting change |      | $       | (42,868 | ) | $       | (65,547
|                                   |                                                                                                      |      |         |         |   |         |        

F-25

---



Financial
information relating to the Company's continuing operations by geographic area is as follows for the years ended December 31:

2004

2003

2002(in thousands of dollars)RevenueUnited States

$
366,674

$
297,897

$
273,344International


13,797


11,065


18,492$
380,471

$
308,962

$
291,836


2004

2003(in thousands of dollars)Long-Lived AssetsUnited States

$
794,973

$
828,270International


39,749


37,748$
834,722

$
866,018


13.   Related-Party Transactions



In 2003, Credit Suisse First Boston Corporation ("CSFB"), an affiliate of the DLJ Merchant Banking funds, provided services to the Company in connection with the
arrangement and syndication of the Credit Facility and as a lender thereunder. CSFB was an initial purchaser of, the Senior Secured Notes. The Company paid customary financing fees to CSFB for those
services. The aggregate amount of all fees paid to the CSFB entities in connection with these financings during 2003 was approximately $10.4 million, including
out-of-pocket expenses. This amount has been capitalized as deferred financing costs and is being amortized over the remaining term of the Senior Secured Notes.

The
Company has agreed to pay CSFB an annual advisory fee of $0.5 million until the earlier of (i) an initial public offering of Holdings, (ii) the date when the DLJ
Merchant Banking funds own less than 162/3% of the shares of Holdings' common stock held by them on the closing date of the DLJ Acquisition or (iii) October 11, 2005. This
amount is expensed as incurred.

F-26

---



SIGNATURES

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

| |  | ADVANSTAR, INC.
| |  | ---------------
| |  | By:            
| |  |                

---





|     |  | Exhibit Index                                                        
|---- |  | ---------------------------------------------------------------------
|31.1 |  | Rule 13a-14(a) or 15d-14(a) Certification of Chief Executive Officer.
|31.2 |  | Rule 13a-14(a) or 15d-14(a) Certification of Chief Financial Officer.
|32.1 |  | Section 1350 Certification of Chief Executive Officer.               
|32.2 |  | Section 1350 Certification of Chief Financial Officer.               

2

---



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