UNITED STATES
SECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549

FORM 10-Q

ý

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934For the Quarterly Period Ended June 30, 2009Oro

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934For the transition period
from                        to


Commission File No. 001-34064



TICKETMASTER ENTERTAINMENT, INC.(Exact name of registrant as specified in its charter)

Delaware(State or other jurisdiction of
incorporation or organization)

95-4546874(I.R.S. Employer
Identification No.)


8800 Sunset Blvd., West Hollywood, CA 90069(Address of Registrant's principal executive offices)

(310) 360-3300(Registrant's telephone number, including area code)



Indicate
by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past
90 days.    Yes ý    No o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to
be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that
the registrant was required to submit and post such
files).    Yes o    No o

Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting
company. See definition of "accelerated filer," "large accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer o

Accelerated filer o

Non-accelerated filerý (Do not check if a smaller reporting company)

Smaller reporting company o


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

As of August 10, 2009, the following shares of the Registrant's common stock were outstanding: 57,336,501



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Table of Contents



TICKETMASTER ENTERTAINMENT, INC.        FORM 10-Q        For the Quarterly Period Ended June 30, 2009        TABLE OF CONTENTS



Page
NumberPART IItem 1.

Consolidated Financial Statements

1Consolidated Statements of Operations for the Three Months and Six Months Ended June 30, 2009 and 2008 (unaudited)

1Consolidated Balance Sheets as of June 30, 2009 (unaudited) and December 31, 2008

2Consolidated Statement of Temporary Equity and Equity as of June 30, 2009 (unaudited) and December 31, 2008

3Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2009 and 2008 (unaudited)

4Notes to Unaudited Consolidated Financial Statements

5Item 2.

Management's Discussion and Analysis of Financial Condition and Results of Operations

28Item 3.

Quantitative and Qualitative Disclosures About Market Risk

43Item 4(T).

Controls and Procedures

43PART II

OTHER INFORMATION

44Item 1.

Legal Proceedings

44Item 1A.

Risk Factors

46Item 6.

Exhibits

48Signatures

49


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Table of Contents

PART 1FINANCIAL STATEMENTS

Item 1.Consolidated Financial Statements



TICKETMASTER ENTERTAINMENT, INC.        CONSOLIDATED STATEMENTS OF OPERATIONS        (Unaudited)

Three Months Ended
June 30,

Six Months Ended
June 30,2009

2008

2009

2008(In thousands, except per share data)Revenue

$
354,427

$
378,945

$
727,242

$
723,762Interest on funds held for clients


629


3,424


1,630


7,588Total revenue


355,056


382,369


728,872


731,350Cost of sales (exclusive of depreciation shown separately below)


220,807


248,549


453,367


469,571Gross profit


134,249


133,820


275,505


261,779Selling and marketing expense


19,590


24,636


43,885


44,029General and administrative expense


64,701


45,644


128,904


87,497Amortization of intangibles


20,857


11,535


35,915


20,403Depreciation


14,079


11,828


26,479


22,883Operating income


15,022


40,177


40,322


86,967Other expense, net:Interest income


727


3,463


1,368


6,753Interest expense


(15,419
)

(8,901
)

(33,575
)

(9,636
)Equity in income of unconsolidated affiliates


545


(1,468
)

1,888


(802
)Other income (expense)


3,730


(287
)

3,539


657Total other expense, net


(10,417
)

(7,193
)

(26,780
)

(3,028
)Earnings before income taxes and noncontrolling interests


4,605


32,984


13,542


83,939Income tax provision


(1,520
)

(10,854
)

(5,721
)

(29,675
)Net income


3,085


22,130


7,821


54,264Plus: Loss attributable to noncontrolling interests, net


3,792


882


6,305


1,455Net income attributable to Ticketmaster Entertainment, Inc.

$
6,877

$
23,012

$
14,126

$
55,719Net earnings per share available to common stockholders:Basic

$
0.12

$
0.41

$
0.25

$
0.99Diluted

$
0.12

$
0.41

$
0.24

$
0.99Weighted average number of shares of common and common equivalent stock outstanding:Basic


57,339


56,171


57,330


56,171Diluted


59,464


56,171


59,341


56,171


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

1

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Table of Contents

TICKETMASTER ENTERTAINMENT, INC.        CONSOLIDATED BALANCE SHEETS

June 30,
2009

December 31,
2008(Unaudited)(In thousands, except per share data)ASSETSCash and cash equivalents

$
616,072

$
464,618Marketable securities





1,495Accounts receivable, client accounts


75,070


70,121Accounts receivable, trade, net of allowance of $6,061 and $3,662, respectively


45,839


46,459Deferred income taxes


14,167


14,038Contract advances


49,471


44,927Prepaid expenses and other current assets


39,991


37,758Total current assets


840,610


679,416Property and equipment, net


110,414


111,291Goodwill


469,053


455,751Intangible assets, net


318,295


330,061Long-term investments


16,652


17,487Other non-current assets


111,621


112,561TOTAL ASSETS

$
1,866,645

$
1,706,567LIABILITIES, TEMPORARY EQUITY AND EQUITYLIABILITIES:Accounts payable, client accounts

$
448,581

$
324,164Accounts payable, trade


31,640


29,251Accrued compensation and benefits


42,473


39,683Deferred revenue


33,960


33,244Income taxes payable


6,978


7,522Other accrued expenses and current liabilities


87,385


82,435Total current liabilities


651,017


516,299Long-term debt


865,000


865,000Income taxes payable


4,316


1,680Other long-term liabilities


16,851


10,286Deferred income taxes


56,653


67,300Commitments and contingenciesTEMPORARY EQUITY:Series A convertible redeemable preferred stock, $0.01 par value, 25,000 shares authorized, 1,750 non-vested shares issued and outstanding at
June 30, 2009 and December 31, 2008


13,009


9,888Redeemable noncontrolling interests


765


1,293EQUITY:Ticketmaster Entertainment, Inc. stockholders' equity:Common stock, $0.01 par value, 300,000 shares authorized; 57,357 shares issued and outstanding at June 30, 2009 and 57,213 shares issued and outstanding
at December 31, 2008


574


572Additional paid-in capital


1,242,679


1,236,130Accumulated deficit


(1,044,632
)

(1,058,758
)Accumulated other comprehensive income (loss)


327


(11,374
)Total Ticketmaster Entertainment, Inc. stockholders' equity


198,948


166,570Noncontrolling interests


60,086


68,251Total equity


259,034


234,821TOTAL LIABILITIES, TEMPORARY EQUITY AND EQUITY

$
1,866,645

$
1,706,567


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

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Table of Contents

TICKETMASTER ENTERTAINMENT, INC.        CONSOLIDATED STATEMENT OF TEMPORARY EQUITY AND EQUITY        (Unaudited)

Temporary Equity

Ticketmaster Entertainment, Inc. Stockholders' EquityRedeemable Preferred Stock $0.01 Par Value



Common Stock $0.01 Par ValueAccumulated
Other
Comprehensive
IncomeRedeemable
Noncontrolling
Interests

Additional
Paid-in
Capital

Retained
Deficit

Noncontrolling
Interests

Total
EquityAmount

Shares

Amount

Shares(In thousands)Balance as of December 31, 2008

$
9,888


1,750

$
1,293

$
572


57,213

$
1,236,130

$
(1,058,758
)
$
(11,374
)
$
68,251

$
234,821Comprehensive income:Net income (loss)








(3,865
)










14,126





(2,440
)

11,686Foreign currency translation























11,701





11,701Comprehensive (loss) income








(3,865
)
















(2,440
)

23,387Issuance of common stock











2


144


761











763Stock-based compensation


3,121





890








8,591











8,591Repurchase of outstanding options

















(356
)










(356
)Fair value of redeemable noncontrolling interests adjustment








2,447








(2,447
)










(2,447
)Distributions to minority partners


























(5,725
)

(5,725
)Balance as of June 30, 2009

$
13,009


1,750

$
765

$
574


57,357

$
1,242,679

$
(1,044,632
)
$
327

$
60,086

$
259,034


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

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TICKETMASTER ENTERTAINMENT, INC.        CONSOLIDATED STATEMENTS OF CASH FLOWS        (Unaudited)

Six Months Ended June 30,2009

2008(In thousands)Cash flows from operating activities:Net income.

$
7,821

$
54,264Adjustments to reconcile net income to net cash provided by operating activities:Amortization of intangibles


35,915


20,403Depreciation


26,479


22,883Amortization of debt issuance costs


2,229


Provision for doubtful accounts


1,970


3,882Stock-based compensation expense


12,602


11,393Deferred income taxes


(10,807
)

(2,703
)Equity in income of unconsolidated affiliates, net of dividends


2,069


4,290Excess tax benefits from stock-based awards





(53
)Changes in current assets and liabilities, excluding acquisition effects:Accounts receivable


(165
)

(5,282
)Prepaid expenses and other current assets


(3,963
)

(12,020
)Accounts payable and other current liabilities


2,883


(31,242
)Income taxes payable


2,277


(5,389
)Deferred revenue


287


5,652Funds collected on behalf of clients, net


104,174


42,530Other, net


(78
)

106Net cash provided by operating activities


183,693


108,714Cash flows from investing activities:Transfers to IAC





(141,914
)Cash paid for acquisitions, net of cash acquired


(24,636
)

(393,545
)Purchases of property and equipment


(23,804
)

(23,240
)Purchase of marketable securities





(4,176
)Proceeds from sales and maturities of marketable securities


1,497


Cash paid for long-term investments


(134
)

(257
)Net cash used in investing activities


(47,077
)

(563,132
)Cash flows from financing activities:Capital contributions from IAC





393,545Principal payments on long-term obligations


(1,140
)

(929
)Distributions to noncontrolling interests


(5,725
)

Excess tax benefits from equity awards





53Other, net


(355
)

Net cash (used in) provided by financing activities


(7,220
)

392,669Effect of exchange rate changes on cash and cash equivalents


22,058


14,127Net increase (decrease) in cash and cash equivalents


151,454


(47,622
)Cash and cash equivalents at beginning of period


464,618


568,417Cash and cash equivalents at end of period

$
616,072

$
520,795


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

4

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Table of Contents



TICKETMASTER ENTERTAINMENT, INC.        NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1ORGANIZATION AND BASIS OF PRESENTATION

Company Overview

Ticketmaster Entertainment, Inc., a Delaware corporation ("Ticketmaster Entertainment," "we," "our," "us" or the "Company"),
consists of Ticketmaster and Front Line Management Group, Inc. ("Front Line"). Ticketmaster operates in 20 global markets, providing ticket sales, ticket resale services, marketing and
distribution throughwww.ticketmaster.com, numerous retail outlets and worldwide call centers. Established in 1976, Ticketmaster serves clients
worldwide across multiple event categories, providing exclusive ticketing services for leading arenas, stadiums, professional sports franchises and leagues, college sports teams, performing arts
venues, museums, and theaters. Ticketmaster Entertainment acquired a controlling interest in Front Line in October 2008. Founded by Irving Azoff and Howard Kaufman in 2004, Front Line is an artist
management company.

Spin-off from IAC/InterActiveCorp

On July 1, 2008, the Board of Directors of IAC/InterActiveCorp ("IAC") approved a plan to separate IAC into five separate,
publicly traded companies via the distribution of all
of the outstanding shares of common stock of four wholly-owned subsidiaries (the "Spincos"), including Ticketmaster Entertainment.

On
August 20, 2008, IAC distributed to its stockholders all of the outstanding shares of common stock, par value $0.01 per share, of Ticketmaster Entertainment (the
"spin-off"). Ticketmaster Entertainment's businesses include the businesses that formerly comprised IAC's Ticketmaster segment (which, at the time of the spin-off, included
IAC's domestic and international ticketing and ticketing related businesses, subsidiaries and investments, and excluded Ticketmaster Entertainment's Reserve America subsidiary and its investment in
Active.com). At the time of the spin-off, Ticketmaster Entertainment also included IAC's minority investment in Front Line. On October 29, 2008, the Company acquired additional
equity interests in Front Line, giving Ticketmaster Entertainment a controlling interest in Front Line.

Upon
completion of the spin-off (and for a short period prior to that, on a "when issued" basis), Ticketmaster Entertainment shares began trading on The Nasdaq Global Select
Market ("NASDAQ") under the symbol "TKTM." In conjunction with the spin-off, Ticketmaster Entertainment completed the following transactions: (1) extinguished all intercompany
receivable balances due from IAC and its subsidiaries, which totaled $604.4 million, by recording a non-cash distribution to IAC, (2) recapitalized the invested equity
balance with common stock, whereby holders of IAC stock received one fifth of a share of Ticketmaster Entertainment common stock for each share of common and class B common stock of IAC held,
as described in our Post Effective Amendment No. 1 to Form S-1 (Commission File Number 333-152702) filed with the Securities and Exchange Commission
("SEC") on August 20, 2008, and (3) distributed $752.9 million in cash to IAC in connection with Ticketmaster Entertainment's separation from IAC, which included the net proceeds
of $723.6 million from a combination of privately issued debt securities and bank borrowings. Refer to Note 5Long-Term Debt.

Pending Merger with Live Nation

On February 10, 2009, the Company entered into a definitive agreement to merge with Live Nation, Inc. ("Live Nation") in
a stock transaction pursuant to which the Company will merge with and into an indirect, wholly-owned subsidiary of Live Nation ("Merger Sub"), with Merger Sub continuing as the surviving entity and an
indirect, wholly-owned subsidiary of Live Nation and Live Nation

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Table of Contents

TICKETMASTER ENTERTAINMENT, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTE 1ORGANIZATION AND BASIS OF PRESENTATION (Continued)

continuing
as the public parent of the combined companies (the "Merger"). Pursuant to the terms of the merger agreement, the aggregate number of shares of Live Nation common stock that the holders of
securities representing 100% of the voting power of the Company's equity interests issued and outstanding immediately prior to the consummation of the Merger are entitled to receive in the Merger
will represent 50.01% of the total voting power of the Live Nation equity interests issued and outstanding immediately following the consummation of the Merger. The Merger requires, among other
customary closing conditions, approval by a majority of the outstanding shares of the Company's common stock and Series A Preferred Stock, voting together as a single class, approval by a
majority of the shares of Live Nation's common stock, represented in person or by proxy, domestic and foreign regulatory approvals, and receipt of the necessary consent of lenders party to the
Company's credit facility to allow the facility to remain in effect after the consummation of the Merger with no default or event of default thereunder resulting from the Merger, which consent was
obtained in May 2009. Liberty Media Corporation ("Liberty"), which beneficially owns approximately 29% of the Company's outstanding common stock, has agreed to vote in favor of the proposed
transaction, subject to the terms of a voting agreement.

The
proposed transaction has been subject to antitrust/competition regulatory review in the United States and four other countries. Ticketmaster Entertainment currently expects the
regulatory process to be completed, and the Merger to close, during 2009. In the United States, Ticketmaster Entertainment and Live Nation are engaged in discussions with the U.S. Department of
Justice, Antitrust Division ("DOJ") regarding the proposed transaction. The parties have been in the process of responding to the DOJ's "second request" for information related to the companies'
respective businesses and the proposed merger. The DOJ is actively investigating the merger and has advised that if there are no unanticipated delays, it currently expects to complete the work on its
investigation of the transaction by the end of September 2009.

The
other jurisdictions where the transaction has been under regulatory review are Canada, the United Kingdom, Norway and Turkey. The Canadian authorities issued a "second request" for
additional information relating to the parties' respective businesses, and the parties are in the process of responding to the Canadian request. The U.K. authorities have issued several information
requests to which the parties have responded, and the matter is now before the UK Competition Commission ("CC") via a referral from the UK Office of Fair Trading ("OFT") which completed its
investigation in June 2009 and determined that further evaluation by the CC is warranted in light of competition concerns that were identified by the OFT. The CC has scheduled a hearing on the merger
for August 6, 2009. The Norwegian and Turkish competition authorities have both completed and closed their investigations without asserting any objections to the merger.

Basis of Presentation

These interim unaudited consolidated financial statements present our results of operations, financial position, temporary equity and
equity, comprehensive income and cash flows, on a combined basis through the spin-off on August 20, 2008, and on a consolidated basis thereafter. Our pre spin-off
financial statements were prepared on a combined basis rather than a consolidated basis because they excluded Ticketmaster Entertainment's former Reserve America subsidiary and its investment in
Active.com, which were transferred to IAC, and included the investment in Front Line that was not owned prior to the spin-off by legal entities that comprise Ticketmaster Entertainment
businesses.

6

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Table of Contents

TICKETMASTER ENTERTAINMENT, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTE 1ORGANIZATION AND BASIS OF PRESENTATION (Continued)

Ticketmaster
Entertainment's investment in Front Line was consolidated beginning on October 29, 2008, when the Company increased its ownership interest from 39.4% to 82.3%
(approximately 74% on a diluted basis). Prior to October 29, 2008, the investment in Front Line was accounted for using the equity method of accounting. The ownership of Reserve America and the
investment in Active.com were retained by IAC after the spin-off.

We
prepared the interim unaudited consolidated financial statements from the historical results of operations and historical basis of the assets and liabilities of Ticketmaster
Entertainment with the exception of income taxes. We computed income taxes using our stand-alone tax rate. Our income tax payable as well as deferred tax assets and liabilities represent the estimated
impact of filing a consolidated income tax return with IAC through the spin-off, and filing a stand-alone consolidated income tax return thereafter.

Until
the spin-off, we recorded expense allocations from IAC, which consisted of certain IAC general corporate overhead expenses, based on the ratio of our revenue as a
percentage of IAC's total revenue. The general corporate overhead allocations primarily included expenses relating to accounting, treasury, legal, tax, corporate support, human resource functions and
internal audit. Since the spin-off, we have been performing these functions using our own resources or purchased services, including services purchased from IAC pursuant to the
transitional services agreement among IAC and the Spincos.

Interim
results are not necessarily indicative of the results that may be expected for a full year. You should read these interim unaudited consolidated financial statements and notes in
conjunction with our audited consolidated financial statements and notes for the year ended December 31, 2008, which are included in our Form 10-K, as amended.

The
historical June 30, 2008 unaudited financial statements are based on certain assumptions about Ticketmaster Entertainment as a stand-alone company. Our management believes the
assumptions underlying the historical combined financial statements of Ticketmaster Entertainment are reasonable. However, this financial information does not necessarily reflect what the historical
financial position, results of operations and cash flows of Ticketmaster Entertainment would have been if Ticketmaster Entertainment had been a stand-alone company during the period presented.

The
accompanying unaudited consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles for interim financial information and the
rules and regulations of the SEC. Accordingly, they do not include all of the information and notes required by
U.S. generally accepted accounting principles for audited financial statements. In the opinion of Ticketmaster Entertainment's management, all adjustments (consisting of normal recurring accruals)
considered necessary for a fair presentation have been included.

We
have evaluated all subsequent events through August 13, 2009, the date the financial statements were issued.

Reclassifications

Certain amounts in the prior year's combined financial statements and notes have been reclassified to conform to the
current-year presentation.

7

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Table of Contents

TICKETMASTER ENTERTAINMENT, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTE 2SUMMARY OF ACCOUNTING STANDARDS

Recently Adopted Accounting Standards

Disclosures by Public Entities about Transfers of Financial Assets and Interests in Variable Interest Entities

In December 2008, the Financial Accounting Standards Board (the "FASB") issued FASB Staff Position ("FSP") FAS No.140-4 and
FASB Interpretation No. 46(R)-8,Disclosures by Public Entities about Transfers of Financial Assets and Interests in Variable Interest
Entities("FSP FAS No. 140-4" and "FIN 46(R)-8"). FSP FAS No. 140-4 and FIN 46(R)-8 require
additional disclosures about an entity's involvement with variable interest entities and transfers of financial assets. Ticketmaster Entertainment adopted FSP FAS No. 140-4 and
FIN 46(R)-8 on January 1, 2009, and the standards did not have a material impact on the Company's consolidated financial statements.

Equity Method Investment Accounting Considerations

In November 2008, the FASB ratified the Emerging Issues Task Force ("EITF") consensus on Issue No. 08-6, Equity Method Investment Accounting
Considerations("EITF 08-6") which addresses certain effects of Statement of Financial Accounting
Standards ("SFAS") No. 141 (revised 2007),Business Combinations("SFAS No. 141R") and SFAS No. 160, Noncontrolling Interests in Financial Statementsan
amendment of Accounting Research Bulletin No. 51("SFAS No. 160") on an
entity's accounting for equity-method investments. The consensus indicates, among other things, that transaction costs for an investment should be included in the cost of the equity-method investment
(and not expensed) and shares subsequently issued by the equity-method investee that reduce the investor's ownership percentage should be accounted for as if the investor had sold a proportionate
share of its investment, with gains or losses recorded through earnings. Ticketmaster Entertainment adopted EITF 08-6 on January 1, 2009, and the standard did not have a
material impact on the Company's consolidated financial statements.

Accounting for Defensive Intangible Assets

In November 2008, the FASB ratified the EITF consensus on Issue No. 08-7,Accounting for
Defensive Intangible Assets("EITF 08-7"). EITF 08-7 addresses the accounting for an intangible asset acquired in a business combination
or asset acquisition that an entity does not intend to use or intends to hold to prevent others from obtaining access (a defensive intangible asset). Under EITF 08-7, a defensive
intangible asset would need to be accounted for as a separate unit of accounting and would be assigned a useful life based on the period over which the asset diminishes in value. Ticketmaster
Entertainment adopted EITF 08-7 on January 1, 2009, and the standard did not have a material impact on the Company's consolidated financial statements.

Determining Whether Instruments Granted in Share-Based Payment Transactions are Participating Securities

In June 2008, the FASB issued FSP No. EITF 03-6-1,Determining Whether
Instruments Granted in Share-Based Payment Transactions Are Participating Securities("FSP No. EITF 03-6-1"). FSP No.
EITF 03-6-1 clarifies that share-based payment awards that entitle their holders to receive nonforfeitable dividends before vesting should be considered participating
securities and included in the calculation of basic EPS. Ticketmaster Entertainment adopted EITF 03-06-1 on January 1, 2009, and the standard did not have a
material impact on the Company's consolidated financial statements.

8

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Table of Contents

TICKETMASTER ENTERTAINMENT, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTE 2SUMMARY OF ACCOUNTING STANDARDS (Continued)

Determination of the Useful Life of Intangible Assets

In April 2008, the FASB issued FSP No. FAS 142-3,Determination of the Useful Life of
Intangible Assets("FSP No. FAS 142-3"). FSP No. FAS 142-3 amends the factors that should be considered in developing renewal or extension
assumptions used to determine the useful life of a recognized intangible asset under SFAS No. 142,Goodwill and Other Intangible Assets.
Ticketmaster Entertainment adopted FSP No.
FAS 142-3 on January 1, 2009 on a prospective basis, and the standard did not have a material impact on the Company's consolidated financial statements.

Disclosures about Derivative Instruments and Hedging Activities

In March 2008, the FASB issued SFAS No. 161,Disclosures about Derivative Instruments and Hedging
Activitiesan amendment of FASB Statement No. 133("SFAS No. 161"). SFAS No. 161 requires enhanced disclosures on an entity's derivative and
hedging activities. Entities are required to provide enhanced disclosures about (i) how and why an entity uses derivative instruments, (ii) how derivative instruments and related hedging
items are accounted for under SFAS No. 133 and its related interpretations and (iii) how derivative instruments and related hedged items affect an entity's financial position, financial
performance, and cash flows. Ticketmaster Entertainment adopted SFAS No. 161 on January 1, 2009. Because SFAS No. 161 amends only the disclosure requirements for derivative
instruments and hedged items, the adoption of SFAS No. 161 did not have a material impact on the Company's consolidated financial statements.

Noncontrolling Interests in Consolidated Financial Statements

In December 2007, the FASB issued SFAS No. 160, which changes the accounting and reporting for minority interests.
Noncontrolling (minority) interests will be reported as a component of equity separate from the parent's equity, and purchases or sales of equity interests that do not result in a change in control
will be accounted for as equity transactions. In addition, net income attributable to the noncontrolling interest will be included in consolidated net income on the face of the statement of operations
and upon a loss of control, the interest sold, as well as any interest retained, will be recorded at fair value with any gain or loss recognized in earnings. SFAS No. 160 is applied
prospectively, except for the presentation and disclosure requirements, which are applied retrospectively for all periods presented. Ticketmaster Entertainment adopted SFAS No. 160 on
January 1, 2009. As a result of the adoption, we have reclassified certain noncontrolling interests from liabilities to a component of equity. In accordance with FASB EITF Topic
No. D-98, "Classification and Measurement of Redeemable Securities," securities that are redeemable at the option of the holder and
not solely within the control of the issuer, must be classified outside of equity. Since the noncontrolling interests held by third parties in certain consolidated subsidiaries are exercisable outside
the control of the Company, these interests are classified as a component of temporary equity in the accompanying consolidated balance sheets.

Business Combinations

In December 2007, the FASB issued SFAS No. 141R, which replaces SFAS No. 141. SFAS No. 141R establishes revised
principles and requirements for the recognition and measurement of assets and liabilities in a business combination. SFAS No. 141R requires (i) recognition of 100% of the fair values of
acquired assets, including goodwill, and assumed liabilities upon obtaining control,

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TICKETMASTER ENTERTAINMENT, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTE 2SUMMARY OF ACCOUNTING STANDARDS (Continued)

(ii) contingent
consideration to be fair valued at the acquisition date, (iii) transaction costs to be expensed as incurred, (iv) pre-acquisition contingencies to be
accounted for at the acquisition date at fair value and (v) costs of a plan to exit an activity or terminate or relocate employees to be accounted for as post combination costs. SFAS
No. 141R is effective for fiscal years beginning after December 15, 2008, and early adoption was prohibited. SFAS No. 141R requires prospective application for all acquisitions
after the adoption date. The Company expects SFAS No. 141R to have an impact on how acquisitions are reflected in the consolidated financial statements when effective, but the timing, nature
and magnitude of the specific effects will depend on the nature, terms and size of any acquisitions that the Company consummates after the effective date. As of December 31, 2008, approximately
$0.6 million of transaction costs related to deals not consummated were capitalized and included in prepaid expenses and other current assets. These costs were expensed during the first quarter
of 2009.

Additionally,
for business combinations for which the acquisition date occurs prior to the effective date of SFAS No. 141R, the acquirer is required to apply the requirements of
SFAS No. 109,Income Taxes, as amended by SFAS No. 141R, prospectively. After the effective date of SFAS No. 141R, changes in the
valuation allowance for acquired deferred tax assets and dispositions of uncertain income tax positions must be recognized as an adjustment to income tax expense, rather than through goodwill. The
impact of the adoption of SFAS No. 141R on the Company's consolidated financial statements will largely be dependent on the size and nature of the business combinations completed after
January 1, 2009.

In
April 2009 the FASB issued FSP No. 141R-1Accounting for Assets Acquired and Liabilities Assumed in a Business Combination That Arise from
Contingencies, ("FSP No. 141R-1"). FSP No. 141R-1 amends the provisions in SFAS No. 141R for the initial recognition and
measurement, subsequent measurement and accounting, and disclosures for assets and liabilities arising from contingencies in business combinations. FSP No. 141R-1 eliminates the
distinction between contractual and non-contractual contingencies, including the initial recognition and measurement criteria in SFAS No.141R, and instead carries forward most of the
provisions in SFAS No. 141 for acquired contingencies. FSP No. 141R-1 is effective for contingent assets and contingent liabilities acquired in business combinations for
which the acquisition date is on or after the beginning of the first annual reporting period beginning on or after December 15, 2008. Ticketmaster Entertainment adopted FSP141R-1 on
January 1, 2009 and the standard did not have a material impact on the Company's consolidated financial statements.

Accounting by Lessees for Maintenance Deposits

In June 2008, the FASB issued EITF Issue No. 08-3,Accounting by Lessees for Maintenance
Deposits("EITF 08-3"). EITF 08-03 concluded that maintenance deposits should be considered a deposit when paid to the lessor if it is
probable that the deposits will be refunded to the lessee. The cost of maintenance activities should be expensed or capitalized by the lessee, as appropriate, when the underlying maintenance is
performed. If it is less than probable that a maintenance deposit will be refunded to the lessee, the deposit is recognized as additional rent expense. EITF 08-03 is effective for
financial statements issued for fiscal years beginning after December 15, 2008. Ticketmaster Entertainment adopted EITF 08-3 on January 1, 2009 and the standard did
not have an impact on the Company's consolidated financial statements.

10

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TICKETMASTER ENTERTAINMENT, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTE 2SUMMARY OF ACCOUNTING STANDARDS (Continued)

Subsequent Events

In May 2009, the FASB issued SFAS No. 165,Subsequent Events, ("SFAS
No. 165"). SFAS No. 165 establishes general standards of accounting for and disclosure of events that occur after the balance sheet date but before financial statements are issued or are
available to be issued. In particular, SFAS No. 165 sets forth the following: (i) the period after the balance sheet date during which management of a reporting entity should evaluate
events or transactions that may occur for potential recognition or disclosure in the financial statements; (ii) the circumstances under which an entity should recognize events or transactions
occurring after the balance sheet date in its financial statements; and (iii) the disclosures that an entity should make about events or transactions that occurred after the balance sheet date.
SFAS No. 165 does not apply to subsequent events or transactions that are within the scope of other applicable U.S. generally accepted accounting principles that provide different guidance on
the accounting treatment for subsequent events or transactions. SFAS No. 165 is effective for interim or annual financial periods ending after June 15, 2009, but should be applied on a
prospective basis. Ticketmaster Entertainment adopted SFAS No. 165 in the second quarter of 2009, and the standard did not have a material impact on the Company's consolidated financial
statements and disclosures.

Fair Value Accounting

In April 2009, the FASB issued FSP No. 107-1 and Accounting Principles Board Opinion ("APB")
No. 28-1,Interim Disclosures about Fair Value of Financial Instruments("FSP FAS No. 107-1 and APB
No. 28-1"). FSP FAS No. 107-1 and APB No. 28-1 amends SFAS No. 107, "Disclosures about Fair Value of Financial
Instruments,"to require disclosures about the fair value of financial instruments for interim reporting periods ending after June 15, 2009. Ticketmaster Entertainment
adopted FSP FAS No. 107-1 and APB No. 28-1 in the second quarter of 2009, and the standard did not have an impact on the Company's financial statement
disclosures.

Recent Accounting Pronouncements

Variable Interest Entities

In June 2009, the FASB issued SFAS No. 167,Amendments to FASB Interpretation
No. 46(R)("SFAS No. 167"). This statement amends certain requirements of FASB Interpretation No. 46 (revised December 2003), Consolidation of Variable Interest Entities. Among other accounting and disclosure requirements, SFAS No. 167 replaces the quantitative-based
risks and rewards calculation for determining which enterprise has a controlling financial interest in a variable interest entity with an approach focused on identifying which enterprise has the power
to direct the activities of a variable interest entity and the obligation to absorb losses of the entity or the right to receive benefits from the entity. The Company will adopt SFAS No. 167 in
its first annual and interim reporting periods beginning after November 15, 2009. The Company is evaluating the impact of SFAS No. 167 on the Company's consolidated financial statements.

The FASB Accounting Standards Codification and the Hierarchy of Generally Accepted Accounting Principles

Effective July 1, 2009, the FASB issued SFAS No. 168,The FASB Accounting Standards Codification
and the Hierarchy of Generally Accepted Accounting Principlesa replacement of FASB Statement No. 162("SFAS No. 168"). Under SFAS No. 168, the
historical GAAP hierarchy was eliminated and the

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TICKETMASTER ENTERTAINMENT, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTE 2SUMMARY OF ACCOUNTING STANDARDS (Continued)

Accounting
Standards Codification became the single official source of authoritative, non-governmental GAAP, other than guidance issued by the SEC. All other literature became
non-authoritative. SFAS No. 168 is effective for financial statements issued for interim and annual periods ending after September 15, 2009. Since SFAS No. 168 does
not change GAAP, the Company has determined that the adoption of SFAS No. 168 will not have an impact on the Company's financial statements.

NOTE 3SEGMENT INFORMATION

The overall concept employed by Ticketmaster Entertainment in determining its operating segments is to present the financial information in a manner consistent with how our chief
operating decision maker manages our business, makes operating decisions and evaluates operating performance. Operating segments are consolidated for reporting purposes if they have similar economic
characteristics and meet the aggregation criteria of SFAS No. 131,Disclosures about Segments of an Enterprise and Related Information.

Prior
to the acquisition of a controlling interest in Front Line, Ticketmaster Entertainment had one operating segment in accordance with its internal management structure and based upon
how the chief
operating decision maker viewed the business, its organizational structure and the type of service provided, which primarily was online and offline ticketing services.

After
the October 29, 2008 acquisition of a controlling interest in Front Line, based upon changes in the internal management structure and how the chief operating decision maker
viewed the business, the Company began reporting two segments: Ticketing and Artist Services.

The
Ticketing segment is primarily an agency business that sells tickets for events on behalf of our clients and retains a convenience charge and order processing fee for our services.
We sell tickets through a combination of websites, telephone services and ticket outlets.

The
Artist Services segment primarily provides management services to music recording artists in exchange for a commission on the earnings of these artists. Artist Services also sells
merchandise associated with musical artists at live musical performances, to retailers and directly to consumers via a website.

Revenue
and expenses earned and charged between segments are eliminated in consolidation. Corporate expenses, interest income, interest expense, equity in income of nonconsolidated
affiliates, net loss attributable to noncontrolling interests, and other income (expense) and income tax expense are managed on a total company basis. Corporate expenses primarily include compensation
and other employee costs (including stock-based compensation), outside services and professional fees.

Three Months Ended
June 30,

Six Months Ended
June 30,2009

2008

2009

2008(In thousands)Revenue:Ticketing

$
311,917

$
382,369

$
650,927

$
731,350Artist services


43,139





77,945


Total revenue

$
355,056

$
382,369

$
728,872

$
731,350


12

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TICKETMASTER ENTERTAINMENT, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTE 3SEGMENT INFORMATION (Continued)



Three Months Ended
June 30,

Six Months Ended
June 30,2009

2008

2009

2008(In thousands)Operating income:Ticketing

$
37,487

$
58,459

$
97,575

$
124,954Artist services


1,256





(5,504
)

Corporate and unallocated


(23,721
)

(18,282
)

(51,749
)

(37,987
)Total operating income

$
15,022

$
40,177

$
40,322

$
86,967




Three Months Ended
June 30,

Six Months Ended
June 30,2009

2008

2009

2008(In thousands)Adjusted EBITDA(a):Ticketing

$
63,965

$
84,565

$
143,986

$
172,570Artist services


13,673





18,102


Corporate and unallocated


(21,349
)

(14,397
)

(46,770
)

(30,924
)Total Adjusted EBITDA

$
56,289

$
70,168

$
115,318

$
141,646




Six Months Ended June 30,2009

2008(In thousands)Capital expenditures:Ticketing

$
20,884

$
20,166Artist services


438


Corporate and unallocated


2,482


3,074Total capital expenditures

$
23,804

$
23,240


13

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Table of Contents

TICKETMASTER ENTERTAINMENT, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTE 3SEGMENT INFORMATION (Continued)

The
following table reconciles Adjusted EBITDA for the Company's reportable segments to Net income attributable to Ticketmaster Entertainment, Inc.:

Three Months Ended June 30, 2009Adjusted
EBITDA(a)

Non-cash
compensation
expense

Amortization
of
intangibles

Depreciation
expense

Operating
income(In thousands)Ticketing

$
63,965

$
(1,159
)
$
(12,182
)
$
(13,137
)
$
37,487Artist services


13,673


(3,609
)

(8,675
)

(133
)

1,256Corporate and unallocated


(21,349
)

(1,563
)




(809
)

(23,721
)Total

$
56,289

$
(6,331
)
$
(20,857
)
$
(14,079
)

15,022Other expense, net


(10,417
)Earnings before income taxes and noncontrolling interests


4,605Income tax provision


(1,520
)Net income


3,085Plus: Loss attributable to noncontrolling interests, net


3,792Net income attributable to Ticketmaster Entertainment, Inc.

$
6,877




Three Months Ended June 30, 2008Adjusted
EBITDA(a)

Non-cash
compensation
expense

Amortization
of
intangibles

Depreciation
expense

Operating
income(In thousands)Ticketing

$
84,565

$
(3,436
)
$
(11,535
)
$
(11,135
)
$
58,459Corporate and unallocated


(14,397
)

(3,192
)




(693
)

(18,282
)Total

$
70,168

$
(6,628
)
$
(11,535
)
$
(11,828
)

40,177Other expense, net


(7,193
)Earnings before income taxes and noncontrolling interests


32,984Income tax provision


(10,854
)Net income


22,130Plus: Loss attributable to noncontrolling interests, net


882Net income attributable to Ticketmaster Entertainment, Inc.

$
23,012


14

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TICKETMASTER ENTERTAINMENT, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTE 3SEGMENT INFORMATION (Continued)

Six Months Ended June 30, 2009Adjusted
EBITDA(a)

Non-cash
compensation
expense

Amortization
of
intangibles

Depreciation
expense

Operating
income(In thousands)Ticketing

$
143,986

$
(2,351
)
$
(19,416
)
$
(24,644
)
$
97,575Artist services


18,102


(6,839
)

(16,499
)

(268
)

(5,504
)Corporate and unallocated


(46,770
)

(3,412
)




(1,567
)

(51,749
)Total

$
115,318

$
(12,602
)
$
(35,915
)
$
(26,479
)

40,322Other expense, net


(26,780
)Earnings before income taxes and noncontrolling interests


13,542Income tax provision


(5,721
)Net income


7,821Plus: Loss attributable to noncontrolling interests, net


6,305Net income attributable to Ticketmaster Entertainment, Inc.

$
14,126




Six Months Ended June 30, 2008Adjusted
EBITDA(a)

Non-cash
compensation
expense

Amortization
of
intangibles

Depreciation
expense

Operating
income(In thousands)Ticketing

$
172,570

$
(5,719
)
$
(20,403
)
$
(21,494
)
$
124,954Corporate and unallocated


(30,924
)

(5,674
)




(1,389
)

(37,987
)Total

$
141,646

$
(11,393
)
$
(20,403
)
$
(22,883
)

86,967Other expense, net


(3,028
)Earnings before income taxes and noncontrolling interests


83,939Income tax provision


(29,675
)Net income


54,264Plus: Loss attributable to noncontrolling interests, net


1,455Net income attributable to Ticketmaster Entertainment, Inc.

$
55,719


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TICKETMASTER ENTERTAINMENT, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTE 3SEGMENT INFORMATION (Continued)



The
Ticketing segment's largest client through 2008, Live Nation (including its subsidiary House of Blues) , represented approximately 8% and 18% of Ticketmaster Entertainment's
consolidated revenue for the three months ended June 30, 2009 and 2008 respectively. Live Nation, represented approximately 7% and 17% of the Company's consolidated revenue for the six months
ended June 30, 2009 and 2008 respectively.

NOTE 4INCOME TAXES

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

The
computation of the annual expected effective tax rate at each interim period requires certain estimates and assumptions including, but not limited to, the expected operating income
for the year, projections of the proportion of income (or loss) earned and taxed in foreign jurisdictions, permanent and temporary differences and the likelihood of recovering deferred tax assets
generated in the current year. The accounting estimates used to compute the provision for income taxes may change as new events occur, more experience is acquired, additional information is obtained
or our tax environment changes. To the extent that the estimated annual effective tax rate changes during a quarter, the effect of the change on prior quarters is included in tax expense for the
current quarter. Included in the income tax provision for the three months ended June 30, 2009 is a provision of $0.2 million due to a change in the estimated annual effective tax rate
from that used in the first quarter.

For
the three and six months ended June 30, 2009, the Company recorded a tax provision of $1.5 million and $5.7 million, respectively, which represent effective tax
rates of 33% and 42%, respectively. The tax rate for the three months ended June 30, 2009 is lower than the federal statutory rate of 35% due principally to foreign income taxed at lower rates
including the effects of our international restructuring completed in January 2009, foreign tax credits related to foreign dividends, deductible payments made in connection with a Front Line dividend
and net adjustments related to the reconciliation of provision accruals to tax returns, partially offset by losses in foreign jurisdictions for which no tax benefit can be recognized. The tax rate for
the six months ended June 30, 2009 is higher than the federal statutory rate of 35% due principally to losses in foreign jurisdictions for which no tax benefit can be recognized and adjustments
to deferred taxes due to newly enacted state tax legislation,

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TICKETMASTER ENTERTAINMENT, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTE 4INCOME TAXES (Continued)

partially
offset by foreign income taxed at lower rates including the effects of our international restructuring and foreign tax credits related to foreign dividends.

For
the three and six months ended June 30, 2008, the Company recorded a tax provision of $10.9 million and $29.7 million, respectively, which represent effective
tax rates of 33% and 35%, respectively. The tax rate for the three months ended June 30, 2008 is lower than the federal statutory rate of 35%, due principally to foreign income taxed at lower
rates and foreign tax credits related to foreign dividends, partially offset by losses in foreign jurisdictions for which no tax benefit can be recognized and state and local income taxes. The tax
rate for the six months ended June 30, 2008 approximates the federal statutory rate of 35%, principally due to losses in foreign jurisdictions for which no tax benefit can be recognized and
state and local income taxes, offset by foreign income taxed at lower rates and foreign tax credits related to foreign dividends.

As
of December 31, 2008 and June 30, 2009, the Company had unrecognized tax benefits of approximately $1.3 million and $3.7 million, respectively. During the
three and six months ended June 30, 2009, the unrecognized tax benefits increased by approximately $1.4 million and $2.4 million, respectively, as a result of historical state tax
positions and foreign income tax positions taken in the current year. If unrecognized tax benefits as of June 30, 2009 are subsequently recognized, approximately $3.6 million, net of
related deferred tax assets and interest, would reduce the income tax provision from continuing operations. The Company recognizes interest and, if applicable, penalties related to unrecognized tax
benefits in income tax expense. Included in income tax expense for the three and six months ended June 30, 2009 is $0.2 million, net of related deferred taxes, for interest and penalties
on unrecognized tax benefits. At June 30, 2009, the Company has accrued $0.6 million for the payment of interest and penalties.

By
virtue of previously filed separate company tax returns, as well as consolidated tax returns with IAC, Ticketmaster Entertainment is routinely under audit by federal, state, local and
foreign income tax authorities. These audits include questioning the timing and the amount of deductions and the allocation of income among various tax jurisdictions. Income taxes payable include
amounts considered sufficient to pay assessments that may result from examination of prior year returns; however, the amount paid upon resolution of issues raised may differ from the amount provided.
Differences between the amounts recorded for unrecognized tax benefits and the amounts owed by Ticketmaster Entertainment are recorded in the period they become known.

The
IRS is currently examining the IAC consolidated tax returns for the years ended December 31, 2001 through 2006, which include the operations of Ticketmaster Entertainment from
January 17, 2003, the date which Ticketmaster Entertainment joined the IAC consolidated tax group. The statute of limitations for these years has been extended to December 31, 2011.
Various IAC consolidated state and local jurisdictions are currently under examination, the most significant of which are California, Florida, New York and New York City, for various tax years after
December 31, 2001. Ticketmaster Entertainment's operations were included in these returns from January 17, 2003. These examinations are expected to be completed by late 2009. See
Note 14Related Party Transactions to the Company's Annual Report on Form 10-K, as amended, for the year ended December 31, 2008, for a description of the
tax sharing arrangement with IAC and the Spincos.

Ticketmaster
Entertainment believes that it is reasonably possible that its unrecognized tax benefits could decrease by approximately $1.4 million within twelve months of the
current reporting date due to

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TICKETMASTER ENTERTAINMENT, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTE 4INCOME TAXES (Continued)

settlements
and expirations of applicable statute of limitations. An estimate of other changes in unrecognized tax benefits cannot be made, but such other changes are not expected to be significant.

NOTE 5LONG-TERM DEBT

The balance of long-term debt is as follows (in thousands):

June 30, 2009

December 31, 200810.75% Senior Notes due July 28, 2016

$
300,000

$
300,0002008 Term Loan A, due July 25, 2013


100,000


100,0002008 Term Loan B, due July 25, 2014


350,000


350,0002008 Revolver, due July 25, 2013


115,000


115,000Total

$
865,000

$
865,000


The
10.75% Senior Notes ("Senior Notes") contain two incurrence-based financial covenants requiring a minimum fixed charge coverage ratio, as defined therein, of 2.0 to 1.0, and a
maximum secured indebtedness leverage ratio, as defined therein, of 2.25 to 1.0.

Term
Loan A, Term Loan B and the revolving credit facility (the "Revolver"), collectively the ("Senior Secured Credit Facilities") bear interest rates per annum based on fixed and
variable interest rates specified in the credit agreement governing the Senior Secured Credit Facilities. The interest rates for Term Loan A, Term Loan B and the Revolver at June 30, 2009 were
3.34%, 3.84% and 3.21%, respectively.

The
Senior Secured Credit Facilities have two quarterly financial covenants requiring a maximum total leverage ratio, as defined therein, of 3.50 to 1.00 and a minimum interest coverage
ratio, as defined therein, of 3.00 to 1.00. As of June 30, 2009, the Company was in compliance with both of these financial covenants.

As
of June 30, 2009, the Company's long-term debt has scheduled principal repayments for each of the next five years and thereafter as follows (in thousands):

Years Ending December 31,2009

$
2010


2011


13,5002012


18,5002013


191,750Thereafter


641,250Total

$
865,000


In
July 2009, the Company repurchased and retired $13 million aggregate principal amount of our Senior Notes.

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TICKETMASTER ENTERTAINMENT, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTE 6EARNINGS PER SHARE

We compute earnings per share in accordance with SFAS No. 128,Earnings Per Share("SFAS No. 128"). We compute basic
earnings per share using the weighted average number of common shares outstanding for the period. Under the provisions of SFAS No. 128, basic net income per common share is computed by dividing
the net income applicable to common shares by the weighted average number of common shares outstanding during the period. Diluted net income per common share adjusts basic net income per common share
for the effects of stock options, restricted stock and other potentially dilutive financial instruments in the periods in which such effect is dilutive. For the three and six months ended
June 30, 2008, we computed earnings per share using the number of shares of common stock outstanding immediately following the spin-off, as if such shares were outstanding for the
entire period.

The
following table presents our basic and diluted earnings per share:

Three Months Ended
June 30,

Six Months Ended
June 30,2009

2008

2009

2008(In thousands, except for per share data)Net income attributable to Ticketmaster Entertainment, Inc.:

$
6,877

$
23,012

$
14,126

$
55,719Net earnings per share available to common stockholders:Basic

$
0.12

$
0.41

$
0.25

$
0.99Diluted

$
0.12

$
0.41

$
0.24

$
0.99Weighted average of number of shares outstanding:Basic


57,339


56,171


57,330


56,171Dilutive effect of:Options to purchase common stock, restricted stock units and redeemable preferred stock


2,125





2,011


Diluted


59,464


56,171


59,341


56,171


The
diluted weighted average common shares outstanding includes the incremental shares that would be issued upon the assumed exercise of stock options, vesting of restricted stock units
("RSUs") and conversion of the Company's Series A convertible redeemable preferred stock if the effect is dilutive.

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TICKETMASTER ENTERTAINMENT, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTE 7STOCK-BASED COMPENSATION

Stock-based compensation expense related to stock options, restricted stock, RSUs and performance stock units ("PSUs") is included in the following line items in the Consolidated
Statements of Operations for the three and six months ended June 30, 2009 and 2008 (in thousands):

Three Months Ended
June 30,

Six Months Ended
June 30,2009

2008

2009

2008Cost of sales

$
108

$
303

$
220

$
538Selling and marketing expense


117


330


238


588General and administrative expense


6,106


5,995


12,144


10,267Stock-based compensation expense

$
6,331

$
6,628

$
12,602

$
11,393


On
April 15, 2009, certain Front Line executives received grants of 2,592 restricted shares of Front Line's common stock with a grant date fair value of $6.15 million. The
value of the restricted stock is based on values of Front Line equity transactions near the grant date of the restricted stock. Based on the terms of the individual grants, the restricted stock vests
either on the third or fourth anniversary of the grant date. We have recorded $0.4 million of stock-based compensation cost during the three months ended June 30, 2009 related to these
Front Line restricted common stock grants.

In
connection with his appointment to the board, on April 16, 2009, the Company granted 22,000 RSUs to an eligible non-employee member of its Board of Directors with a
grant date fair value of $4.58 per share which vest ratably over two years.

On
April 29, 2009, the Company granted an aggregate of 2,235,000 options with an exercise price of $5.33 per share and an estimated average grant date fair value of approximately
$2.31 per share. The fair value of options granted in 2009 was estimated on the date of grant using the Black-Scholes option pricing model. The assumptions used an expected volatility rate of 43.28%,
dividend yield of 0%, expected term of 6.25 years and a risk-free interest rate of 1.23%. Volatility is based on the historical volatility of stocks of similar companies since the
Company does not have sufficient trading history to reasonably predict its own volatility. The risk-free rate is based on U.S. Treasury yields for notes with comparable terms as the awards
in effect at the grant date. The Company used the simplified method for estimating the expected life within the valuation model, which is the period of time that options granted are expected to be
outstanding. The options vest ratably over four years and have ten year terms. We have recorded $0.3 million of stock-based compensation cost during the three months ended June 30, 2009
related to these option grants.

On
April 29, 2009, the Company granted 113,000 RSUs to certain employees with a grant date fair value of $5.33 per share. The RSUs vest ratably over four years. We have recorded
$0.1 million of stock-based compensation cost during the three months ended June 30, 2009 related to these RSU grants.

NOTE 8EQUITY INVESTMENTS IN UNCONSOLIDATED AFFILIATES

At June 30, 2009 and December 31, 2008, Ticketmaster Entertainment's equity investments in unconsolidated affiliates totaled $16.7 million and $12.9 million,
respectively, and are included in Long-term investments in the Consolidated Balance Sheets.

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TICKETMASTER ENTERTAINMENT, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTE 8EQUITY INVESTMENTS IN UNCONSOLIDATED AFFILIATES (Continued)

On
October 29, 2008, Ticketmaster Entertainment acquired additional interests in Front Line from certain stockholders of Front Line for an aggregate purchase price of
$123.0 million. On this same date, the Company also acquired equity interests in Front Line in a transaction that, for accounting purposes, was treated as an exchange by a trust controlled by
Mr. Azoff of certain Front Line equity awards for certain Ticketmaster Entertainment equity awards. The Company acquired additional ownership interests of 42.9%, in the aggregate, resulting in
a controlling interest in Front Line of 82.3% (approximately 74% on a diluted basis). Ticketmaster Entertainment's 39.4% ownership interest in Front Line prior to the acquisition was accounted for
under the equity method of accounting. Losses related to the investment in Front Line, which totaled $1.6 million and $1.4 million in the three and six months ended June 30, 2008,
respectively, are included in equity in income of unconsolidated affiliates in the Consolidated Statements of Operations. The results of Front Line were consolidated with Ticketmaster Entertainment
effective October 29, 2008.

The
Company also maintains a 15% investment in Broadway China Ventures and accounts for its investment on a cost basis.

The
following is a list of investments accounted for under the equity method, the principal market in which the investee operates, and the relevant ownership percentage at both
June 30, 2009 and December 31, 2008:

iLike.com (United States)


25.0
%Beijing Gehua Ticketmaster Ticketing Co., Ltd. (China)


40.0
%TM Mexico (Mexico)


33.3
%


The
summarized aggregated financial information of Ticketmaster Entertainment's equity investments is as follows (in thousands):

Six Months Ended
June 30,2009

2008Net sales

$
17,342

$
112,198Gross profit


12,704


54,638Net income


5,283


2,200


The
summarized aggregated financial information for the six months ended June 30, 2008 includes Ticketmaster Entertainment's investment in Front Line which, prior to
October 29, 2008, was accounted for under the equity method of accounting.

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TICKETMASTER ENTERTAINMENT, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTE 9COMPREHENSIVE INCOME

The changes in the components of comprehensive income (loss), net of tax, are as follows (in thousands):

Three Months Ended June 30,

Six Months Ended June 30,2009

2008

2009

2008Net income

$
3,085

$
22,130

$
7,821

$
54,264Foreign currency translation


13,679


2,324


11,701


14,685Total Comprehensive income


16,764


24,454


19,522


68,949Loss attributable to noncontrolling interests, net


3,792


882


6,305


1,455Foreign currency translation


(21
)

2





(75
)Comprehensive loss attributable to noncontrolling interests


3,771


884


6,305


1,380Comprehensive income attributable to Ticketmaster Entertainment, Inc.

$
20,535

$
25,338

$
25,827

$
70,329


Accumulated
other comprehensive income as of June 30, 2009 and June 30, 2008 is solely related to foreign currency translation.

NOTE 10RELATED PARTY TRANSACTIONS

Prior to the spin-off, our operating expenses included allocations from IAC for accounting, treasury, legal, tax, corporate support, human resource functions, and internal
audit functions. These expenses were allocated based on the ratio of Ticketmaster Entertainment's revenue as a percentage of IAC's total revenue. The Company believes that the allocation methods used
by IAC were reasonable. Expense allocations from IAC were $0.8 million and $1.8 million for the three and six months ended June 30, 2008 and are included in general and
administrative expense in our Consolidated Statements of Operations for the period. The expense allocations from IAC ceased upon consummation of the spin-off.

Ticketmaster
Entertainment occupies office space in buildings in Los Angeles and New York City that are currently owned by IAC. Related rental expense charged to Ticketmaster
Entertainment by IAC totaled $0.9 million and $0.6 million for the three months ended June 30, 2009 and 2008, respectively and $1.8 million and $1.3 million for the
six months ended June 30, 2009 and 2008, respectively.

During
the second quarter of 2008, the Company recorded an $8.3 million cumulative interest charge from IAC. Accordingly, the portion of interest expense reflected in the
Company's Consolidated Statement of Operations that was intercompany in nature was $8.3 for the three and six months ended June 30, 2008. The portion of interest income reflected in the
Company's Consolidated Statement of Operations that was intercompany in nature was $2.0 million and $3.7 million for the three and six months ended June 30, 2008, respectively.
The intercompany interest relates to the receivable from IAC which was extinguished upon consummation of the spin-off.

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TICKETMASTER ENTERTAINMENT, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTE 10RELATED PARTY TRANSACTIONS (Continued)

Relationship between IAC and Ticketmaster Entertainment after the spin-off

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

IAC
and Ticketmaster Entertainment currently continue, and for the foreseeable future expect to continue, to work together pursuant to a variety of commercial relationships. In
connection with the spin-off, IAC and Ticketmaster Entertainment entered into various commercial agreements between subsidiaries of IAC, on the one hand, and subsidiaries of Ticketmaster
Entertainment, on the other hand, many of which memorialized (in most material respects) pre-existing arrangements in effect prior to the spin-off and all of which were
negotiated at arm's length.

Agreements with Liberty Media Corporation

In connection with the spin-off, the Company assumed from IAC all of IAC's rights and obligations relating to Ticketmaster
Entertainment under a Spinco Agreement between IAC and Liberty, providing for post-spin-off governance arrangements at the Company. As of February 10, 2009, Liberty
beneficially owned approximately 29.1% of the outstanding shares of common stock of the Company. Refer to the Company's Annual Report on Form 10-K, as amended, for the year ended
December 31, 2008 for a summary of the material terms of those governance agreements and related matters.

Liberty/Live Nation Stockholder Agreement

In connection with Ticketmaster Entertainment entering into a merger agreement with Live Nation, pursuant to which a merger of
Ticketmaster Entertainment with and into a wholly owned subsidiary of Live Nation is pending, on February 10, 2009, Ticketmaster Entertainment entered into a certain Stockholder Agreement among
Live Nation, Liberty, Liberty USA Holdings, LLC and Ticketmaster Entertainment, dated February 10, 2009 (the "Liberty Stockholder Agreement") regarding certain corporate governance
rights, designation rights and registration rights with respect to the Live Nation common stock to be acquired by Liberty in connection with the Merger. Among other things, subject to certain
restrictions and limitations set forth in the Liberty Stockholder Agreement,
Liberty will have the right, following the closing of the Merger, to nominate up to two directors to serve on the Live Nation board of directors. In addition, if Liberty designates two directors to
the Live Nation board of directors, one of them must meet the independence standards of the NYSE with respect to Live Nation, and Liberty would have the right to designate one of its nominees to serve
on the Audit Committee and one nominee to serve on the Compensation Committee of the Live Nation board of directors, subject to such designee's satisfaction of the applicable standards for service on
such committees. Furthermore, the Liberty Stockholder Agreement also contains provisions relating to limitations on the ownership of Live Nation equity securities by Liberty and its affiliates
following the Merger and on transfers of Live Nation equity securities and rights and obligations under the Liberty Stockholder Agreement following the Merger.

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TICKETMASTER ENTERTAINMENT, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTE 10RELATED PARTY TRANSACTIONS (Continued)

Relationships Involving Executives

In connection with Ticketmaster Entertainment's entering into the Live Nation merger agreement referred to above, on
February 10, 2009, Ticketmaster Entertainment entered into a letter agreement, dated as of February 10, 2009, with Mr. Azoff, Chief Executive Officer of Ticketmaster
Entertainment, pursuant to which Ticketmaster Entertainment agreed, prior to the consummation of the Live Nation merger, to redeem the shares of Ticketmaster Entertainment series A convertible
redeemable preferred stock held by or on behalf of Mr. Azoff for a note (i) having terms comparable to the Ticketmaster Entertainment series A convertible redeemable preferred
stock (except that the note will not be convertible into shares of Ticketmaster Entertainment common stock) and (ii) resulting in legal, economic and tax treatment that, in the aggregate, will
be no less favorable to Mr. Azoff than such treatment with respect to the Ticketmaster Entertainment series A convertible redeemable preferred stock.

In
April 2009, the Board of Directors of Front Line declared a dividend in the amount of $115.74844 per share of Front Line common stock payable in cash to the holders of record of Front
Line common stock. This dividend totaled $20,080,656 and was paid in April 2009. The Azoff Family Trust of 1997, of which Mr. Azoff, Ticketmaster Entertainment's Chief Executive Officer, is
co-Trustee, received a pro rata portion of this dividend totaling $3,000,000 with respect to the 25,918.276 shares of Front Line common stock held by the trust. Mr. Azoff, pursuant
to the terms of a restricted share grant agreement, also may be entitled to certain gross-up payments from Front Line associated with distributions made on the unvested portion of his
restricted Front Line common shares for the difference between ordinary income and capital gains tax treatment. Such payments were $0.7 million related to the April 2009 Front Line dividend.
The amount of the pro rata dividend paid to FLMG Holdings Corp. ("FLMG") and TicketWeb, LLC (wholly-owned subsidiaries of Ticketmaster Entertainment that hold Ticketmaster Entertainment's
interest in Front Line), was $15,000,000. Prior to the payment of the dividend, FLMG made a loan to Front Line in the amount of $20,000,000, evidenced by a promissory note from Front Line to FLMG with
a principal amount of $20,000,000 and
bearing interest at a rate of 4.5%, payable no later than six months from the date of issuance. A portion of the proceeds from the note was used, together with cash on hand at Front Line, to pay the
dividend.

For
a further discussion of related party relationships, see Item 13 of the Company's Annual Report on Form 10-K, as amended, for the year ended
December 31, 2008.

NOTE 11COMMITMENTS AND CONTINGIENCIES

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

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TICKETMASTER ENTERTAINMENT, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTE 11COMMITMENTS AND CONTINGIENCIES (Continued)

liquidity,
results of operations, or financial condition of Ticketmaster Entertainment. Ticketmaster Entertainment also evaluates other contingent matters, including tax contingencies, to assess the
probability and estimated extent of potential loss. See Note 4Income Taxes for discussion related to income tax contingencies. For a discussion of certain legal proceedings
involving the Company, see Part II, Item 1 of this Form 10-Q.

In
addition, pursuant to the Agreement and Plan of Merger dated as of February 10, 2009 (the "Merger Agreement"), among the Company, Live Nation, and Merger Sub, if the Merger
Agreement is
terminated before the Merger is completed, under some circumstances the Company may be obligated to pay to Live Nation a termination fee of $15 million plus Live Nation's expenses.

NOTE 12FAIR VALUE MEASUREMENTS

In accordance with SFAS No. 157,Fair Value Measurements("SFAS No. 157"), the Company maximizes the use of observable
inputs and minimizes the use of unobservable inputs when developing fair value measurements. When available, the Company uses quoted market prices to measure fair value. If market prices are not
available, fair value measurement is based upon models that use primarily market-based or independently-sourced market parameters. If market observable inputs for model-based valuation techniques are
not available, the Company will be required to make judgments about assumptions that market participants would use in estimating the fair value of the financial instrument. Fair values of cash and
cash equivalents, short-term accounts receivable, accounts payable and accrued liabilities approximate their carrying amounts because of their short-term nature. Marketable
securities are recognized in the balance sheets at their fair values based on quoted prices. Long-term debt is carried at cost. However, the Company is required to estimate the fair value
of long-term debt under SFAS No. 107,Disclosures about Fair Values of Financial Instruments("SFAS No. 107"). The fair value
of long-term debt is estimated based on market prices or third-party quotes.

The
provisions of SFAS No. 157 related to nonfinancial assets and liabilities became effective for the Company on January 1, 2009 in accordance with FSP
FAS 157-2,Effective Date of FASB Statement No. 157,and is applied prospectively. The application of SFAS No
157-2 did not have a material impact on the Company's consolidated financial statements.

In
connection with the acquisition of certain subsidiaries, the Company is party to fair value put and call arrangements with respect to the common securities that represent the
remaining noncontrolling interests of the acquired company. These put arrangements are exercisable at fair value by the counter-party outside the control of the Company and are accounted for in
accordance with EITF D-98,Classification and Measurement of Redeemable Securities. In accordance with EITF D-98, adjustments to
the carrying amount of noncontrolling interests issued in the form of a common security to reflect a fair value redemption feature do not impact the Company's earnings
per share. Accordingly, to the extent that the fair value of these interests exceeds the value determined by normal noncontrolling interest accounting, the value of such interests is adjusted to fair
value with a corresponding adjustment to additional paid-in capital.

SFAS
No. 157 establishes a three-tiered hierarchy that draws a distinction between market participant assumptions based on (i) quoted prices (unadjusted) in active markets
for identical assets and liabilities (Level 1), (ii) inputs other than quoted prices in active markets that are observable either directly or indirectly (Level 2) and
(iii) unobservable inputs that require the Company to use present value and other valuation techniques in the determination of fair value (Level 3).

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TICKETMASTER ENTERTAINMENT, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTE 12FAIR VALUE MEASUREMENTS (Continued)

The
Company estimated the fair value of its long-term debt by using market prices or third party quotes. The company estimates fair market values for its redeemable
noncontrolling interests using revenue trading multiples of comparable companies.

The
following presents information about accounts required to be measured at fair value on a recurring basis as of June 30, 2009 (in thousands):

Fair Value Measurements as of June 30, 2009Quoted Market
Prices in Active
Markets for
Identical Assets
(Level 1)

Significant
Other Observable Inputs
(Level 2)

Significant
Unobservable Inputs
(Level 3)

Total Fair
Value
Measurements

Carrying
ValueLong-term debt

$


$
792,700

$


$
792,700

$
865,000Redeemable noncontrolling interests








765


765


765Total

$


$
792,700

$
765

$
793,465

$
865,765


The
following table presents the changes in the Company's accounts that are measured at fair value on a recurring basis using significant unobservable inputs (Level 3):

Redeemable noncontrolling interestsBalance as of January 1, 2009

$
1,293Net loss attributable to redeemable noncontrolling interests


(2,975
)Change in fair value of redeemable noncontrolling interests recorded through APIC


2,447Balance as of June 30, 2009

$
765


NOTE 13RESTRUCTURING CHARGES

During the second quarter of 2008, Ticketmaster Entertainment began a comprehensive review of its worldwide cost structure in light of significant investments that have been made through
increased operating and capital expenditures, acquisitions in recent periods, and in advance of the expiration of the various Live Nation ticketing agreements beginning in December 2008. As a result
of this review, commencing in the third quarter of 2008, Ticketmaster Entertainment began to effect a series of actions expected to reduce 2009 annual operating expenses by approximately
$35 million from reductions in personnel, consolidation of customer contact centers, and the balance from reductions in other operating costs and other discretionary costs. The
cost-reduction efforts in the ticketing segment were substantially completed in the second quarter of 2009.

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TICKETMASTER ENTERTAINMENT, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTE 13RESTRUCTURING CHARGES (Continued)

The
following table summarizes the restructuring liabilities balance (included as a component of other accrued expenses within the Consolidated Balance Sheets) as of June 30,
2009.

Balance as of
January 1, 2009

Charges to
expense

Cash
payments

Foreign
Exchange
Translation

Balance as of
June 30, 2009(In thousands)Employee termination costs

$
5,687

$
127

$
(1,671
)
$
(16
)
$
4,127Total

$
5,687

$
127

$
(1,671
)
$
(16
)
$
4,127


During
the first quarter of 2009, the Company recorded a severance and separation charge of $1.4 million for the resignation of an executive of Ticketmaster Entertainment. As of
June 30, 2009, $1.2 million of this liability remains to be paid in bi-weekly installments for the remaining period of twenty-one months through March 2011. The
severance charge was included in the general and administrative expense line item in the Consolidated Statements of Operations for the six months ended June 30, 2009.

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

GENERAL

Forward-Looking Statements

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

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



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Certain
of these factors and other factors, risks and uncertainties are discussed in Part II, Item 1A of this Quarterly Report on Form 10-Q. Other
unknown or unpredictable factors may also cause actual results to differ materially from those projected by the forward-looking statements. Most of these factors are difficult to anticipate and are
generally beyond the control of the Company.

You
should consider the areas of risk described above, as well as those set forth in Part I, Item 1A of the Company's Annual Report on Form 10-K, as
amended, for the year ended December 31, 2008, in connection with considering any forward-looking statements that may be made by the Company generally. The Company does not undertake any
obligation to release publicly any revisions to any forward-looking statements, to report events or to report the occurrence of unanticipated events unless required to do so by law.

Spin-Off from IAC/InterActive Corp

On July 1, 2008, the Board of Directors of IAC approved a plan to separate IAC into five separate, publicly traded companies via
the distribution of all of the outstanding shares of common stock of four wholly-owned subsidiaries, including Ticketmaster Entertainment, formerly known as Ticketmaster.

On
August 20, 2008, IAC distributed to its stockholders all of the outstanding shares of common stock, par value $0.01 per share, of Ticketmaster Entertainment (the
"spin-off"). Our businesses include the businesses that formerly comprised IAC's Ticketmaster segment, which consists of its domestic and international ticketing and ticketing related
businesses, subsidiaries and investments, excluding its ReserveAmerica subsidiary and its investment in Active.com. At the time of the spin-off, Ticketmaster Entertainment includes IAC's
minority investment in Front Line. On October 29, 2008, the Company acquired additional equity interests in Front Line, giving Ticketmaster Entertainment a controlling interest in Front Line.
As a result, the Company consolidated the results of Front Line from the acquisition date.

Pending Merger with Live Nation

On February 10, 2009, the Company signed a definitive agreement to merge with Live Nation in a stock transaction pursuant to
which the Company will merge with and into an indirect, wholly-owned subsidiary of Live Nation ("Merger Sub"), with Merger Sub continuing as the surviving entity and as an indirect, wholly-owned
subsidiary of Live Nation and Live Nation continuing as the public parent of the combined companies (the "Merger"). Pursuant to the terms of the merger agreement, the aggregate

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number
of shares of Live Nation common stock that the holders of securities representing 100% of the voting power of the Company's capital stock issued and outstanding immediately prior to the
consummation of the Merger are entitled to receive in the Merger represents 50.01% of the total voting power of the Live Nation capital stock issued and outstanding immediately following the
consummation of the Merger. The Merger requires, among other customary closing conditions, approval by a majority of the outstanding shares of the Company's common stock and Series A Preferred
Stock, voting together as a single class, approval by a majority of the shares of Live Nation's common stock, represented in person or by proxy, domestic and foreign regulatory approvals, and receipt
of the necessary consent of lenders party to the Company's credit facility to allow the facility to remain in effect after the consummation of the Merger with no default or event of default thereunder
resulting from the Merger, which consent was obtained in May 2009. Liberty, which beneficially owns approximately 29% of the Company's common stock, has agreed to vote in favor of the proposed
transaction, subject to the terms of a voting agreement.

The
proposed transaction has been subject to antitrust/competition regulatory review in the United States and four other countries. Ticketmaster Entertainment currently expects the
regulatory process to be completed, and the Merger to close, during 2009. In the United States, Ticketmaster Entertainment and Live Nation are engaged in discussions with the U.S. Department of
Justice, Antitrust Division ("DOJ") regarding the proposed transaction. The parties have been in the process of responding to the DOJ's "second request" for information related to the companies'
respective businesses and the proposed merger. The DOJ is actively investigating the Merger and has advised that if there are no unanticipated delays, it currently expects to complete the work on its
investigation of the transaction by the end of September 2009.

The
other jurisdictions where the transaction has been under regulatory review are Canada, the United Kingdom, Norway, and Turkey. The Canadian authorities issued a "second request" for
additional information relating to the parties' respective businesses, and the parties are in the process of responding to the Canadian request. The U.K. authorities have issued several information
requests to which the parties have responded, and the matter is now before the UK Competition Commission ("CC") via a referral from the UK Office of Fair Trading ("OFT") which completed its
investigation in June 2009 and determined that further evaluation by the CC is warranted in light of competition concerns that were identified by the OFT. The CC has scheduled a hearing on the Merger
for August 6,
2009. The Norwegian and Turkish competition authorities have both completed and closed their investigations without asserting any objections to the Merger.

Basis of Presentation

These interim unaudited consolidated financial statements of Ticketmaster Entertainment discussed in this Management's Discussion and
Analysis of Financial Condition and Results of Operations present our results of operations, financial position, temporary equity and equity, comprehensive income and cash flows, on a combined basis
through the spin-off on August 20, 2008, and on a consolidated basis thereafter. Our pre spin-off financial statements were prepared on a combined basis rather than a
consolidated basis because they excluded Ticketmaster Entertainment's former Reserve America subsidiary and its investment in Active.com, which were transferred to IAC, and included the investment in
Front Line that was not owned prior to the spin-off by legal entities that comprise Ticketmaster Entertainment businesses.

The
Company's investment in Front Line was consolidated beginning October 29, 2008, when the Company increased its ownership interest from 39.4% to 82.3% (approximately 74% on a
diluted basis). Prior to October 29, 2008, the investment in Front Line was accounted for using the equity method of accounting. The ownership of Reserve America and the investment in
Active.com were retained by IAC after the spin-off. These consolidated financial statements included in this Quarterly

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Report
on Form 10-Q present IAC's and its subsidiaries net investment in Ticketmaster Entertainment businesses as invested capital in lieu of stockholders' equity.

We
prepared the interim unaudited consolidated financial statements from the historical results of operations and historical basis of the assets and liabilities of Ticketmaster
Entertainment with the exception of income taxes. We computed income taxes using our stand-alone tax rate. Our income tax payable as well as deferred tax assets and liabilities represent the estimated
impact of filing a consolidated income tax return with IAC through the spin-off, and filing a standalone consolidated income tax return thereafter. We have eliminated all significant
intercompany transactions and accounts for periods prior to the spin-off.

Until
the spin-off, we recorded expense allocations from IAC, which consisted of certain IAC general corporate overhead expenses based on the ratio of our revenue as a
percentage of IAC's total revenue. The general corporate overhead allocations primarily included expenses relating to accounting, treasury, legal, tax, corporate support, human resource functions and
internal audit. Since the spin-off, we have been performing these functions using our own resources or
purchased services, including services purchased from IAC pursuant to the transitional services agreement among IAC and the Spincos.

The
historical interim unaudited financial statements for periods prior to the spin-off are based on certain assumptions about Ticketmaster Entertainment as a stand-alone
company. Our management believes the assumptions underlying the historical combined financial statements of Ticketmaster Entertainment are reasonable. However, this financial information does not
necessarily reflect what the historical financial position, results of operations and cash flows of Ticketmaster Entertainment would have been if Ticketmaster Entertainment had been a stand-alone
company prior to the spin-off.

We
have evaluated all subsequent events through August 13, 2009, the date the financial statements were issued.

Management Overview

Ticketmaster Entertainment is the world's leading live entertainment ticketing and marketing company, providing ticket sales, ticket
resale services, marketing and distribution through www.ticketmaster.com, one of the largest e-commerce sites on the internet, approximately 7,100 independent sales outlets and 17 call
centers worldwide. Ticketmaster Entertainment serves leading arenas, stadiums, amphitheaters, music clubs, concert promoters, professional sports franchises and leagues, college sports teams,
performing arts venues, museums and theaters in the United States and abroad, including Australia, Canada, China, Denmark, Finland, Germany, Ireland, the Netherlands, New Zealand, Norway, Spain,
Sweden, Turkey and the United Kingdom. Ticketmaster Entertainment is also a party to joint ventures with third parties to provide ticket distribution services in Mexico and supplied ticketing services
for the 2008 Beijing Olympic Games. Ticketmaster Entertainment licenses its technology in Mexico, Argentina, Brazil, Chile, and Belgium.

Sources of Revenue



Ticketmaster Entertainment earns a majority of its revenue from primary ticketing on behalf of its clients. Ticketing operations
revenue primarily consists of convenience and order processing fees generated primarily through ticket sales. The sale of tickets for an event often commences several months prior to the event
performance date. Ticketmaster Entertainment recognizes revenue from the sale of a ticket when the ticket is sold. Fluctuations in ticket operations revenue occur largely as a result of changes in the
number of tickets sold and the average revenue per ticket. The number of tickets sold varies as a result of (i) additions or losses of clients serviced by Ticketmaster

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Entertainment;
(ii) fluctuations in the scheduling of events, particularly for popular performers; (iii) overall consumer demand for live entertainment events; and (iv) the
percentage of tickets for events which are sold directly by clients. The average revenue per ticket varies as a result of the amount of convenience charges earned on each ticket. The amount of
convenience charges typically varies based upon numerous factors, including the face price of the ticket, the type of event, and whether the ticket is purchased at an independent sales outlet, through
call centers or via Ticketmaster Entertainment's websites, as well as the services to be rendered to the client.



Front Line secures work for the clients it represents, for which it receives a commission. Generally, commissions are payable by
clients upon their receipt of payments for performance of services or upon the delivery or use of materials which they created. Revenue is recognized in the month of the artist event. Contingent
commissions, such as those based on profits or gross receipts, are recorded upon determination of the amounts. Revenue is not recognized before persuasive evidence of an arrangement exists, services
have been rendered, the amount to be received is fixed or determinable, and collectability is reasonably assured.

Other
revenues consist of revenues from the sales of entertainment packages to consumers in connection with live performances. Entertainment packages are sold and cash is received from
consumers in advance of the event. Revenue and related expenses incurred are deferred until the event occurs. In addition, Front Line sells entertainment related merchandise at live musical
performances, to retailers, and directly to consumers via a website. For retail and internet sales, revenue is recognized upon shipment of the merchandise. Touring revenue, including the sale of
merchandise, is recognized in the month of the event.

For
a more detailed presentation of the Company's operating businesses, see the Company's Annual Report on Form 10-K, as amended, for the year ended
December 31, 2008.

Results of Operations for the Three and Six Months Ended June 30, 2009 Compared to the Three and Six Months Ended June 30, 2008

Ticketmaster Entertainment Consolidated Results of Operations

Revenue



Three Months Ended June 30,

Six Months Ended June 30,2009

2008

% Change

2009

2008

% Change(Dollars in thousands)RevenueDomestic

$
263,923

$
261,320


1%

$
537,369

$
501,260


7%RevenueInternational


91,133


121,049


(25)%


191,503


230,090


(17)%Total revenue

$
355,056

$
382,369


(7)%

$
728,872

$
731,350


NM


Consolidated

Revenue in the three months ended June 30, 2009 decreased $27.3 million, or 7%, from the prior-year quarter
primarily due to lower ticketing revenue attributable to our largest client through 2008, Live Nation (including its subsidiary, House of Blues) following the expiration on December 31, 2008 of
the principal agreement for primary ticketing services to Live Nation, partially offset by contributions from Front Line, in which the Company acquired a majority interest in October 2008. On a
world-wide basis, there was an 11% decrease in the number of primary tickets sold and a 7%

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decrease
in average revenue per ticket. Domestic revenue was flat compared to the prior-year quarter, with an 11% decrease in the number of tickets sold, along with a 4% decrease in
average revenue per ticket due to lower ticketing revenue attributable to Live Nation, mentioned above, partially offset by contributions from Front Line. Ticketing volumes were lower across all major
categories except Arts and Theatre, with the largest impact experienced in the Concerts category due to the expiration of the principal agreement for primary ticketing with Live Nation. International
revenue decreased by 25% primarily due to an 11% decrease in the number of tickets sold along with a 13% decrease in average revenue per ticket in our international operations, due in part, to the
volatility of foreign exchange rates. The decrease in the average revenue per ticket primarily resulted from decreased revenue from the United Kingdom, Canada, the Netherlands and China, partially
offset by higher revenues in Spain. Excluding the impact of foreign exchange rates, international revenue decreased by 9% compared to the prior-year period.

Ticketmaster
Entertainment's largest client through 2008, Live Nation (including its subsidiary House of Blues), represented approximately 8% and 18% of the Company's consolidated
revenue for the three months ended June 30, 2009 and 2008, respectively.

Revenue
in the six months ended June 30, 2009 decreased $2.5 million from 2008 primarily due to lower ticketing revenue attributable to our largest client through 2008,
Live Nation (including its subsidiary, House of Blues) following the expiration on December 31, 2008 of the principal agreement for primary ticketing services to Live Nation, partially offset
by contributions from Front Line, in which the Company acquired a majority interest in October 2008. On a world-wide basis, there was a 9% decrease in the number of primary tickets sold
and a 4% decrease in average revenue per ticket. Domestic revenue increased by 7% primarily due to contributions from Front Line offset by a 10% decrease in the number of tickets sold, as well as a 1%
decrease in average revenue per ticket. Ticketing volumes were lower across all categories, with the largest impact experienced in the Concerts category due to the expiration of the principal
agreement for primary ticketing with Live Nation. International revenue decreased by 17% primarily due to an 8% decrease in the number of tickets sold along with a 9% decrease in average revenue per
ticket in our international operations, due in part, to the volatility of foreign exchange rates. The decrease in the average revenue per ticket primarily resulted from decreased revenue from the
Netherlands, United Kingdom, Canada, and Australia, partially offset by higher revenues in Spain. Excluding the impact of foreign exchange rates,
international revenue increased by 1% compared to the same-prior-year period.

Ticketmaster
Entertainment's largest client through 2008, Live Nation (including its subsidiary House of Blues), represented approximately 7% and 17% of the Company's consolidated
revenue for the six months ended June 30, 2009 and 2008, respectively.

Segment Revenue Ticketing

Refer to "Consolidated," directly above, for a discussion of revenues in our Ticketing segment.

Artist Services

On October 29, 2008, the Company acquired additional equity interests in Front Line, giving Ticketmaster Entertainment a
controlling interest in the business. The Company has consolidated the results of Front Line since the acquisition date and has entered into the artist services business by virtue of the acquisition.
The artist services business focuses on artist management, merchandising, VIP ticketing and related artist marketing services activities. In the three and six months ended June 30, 2009, Front
Line generated revenues of $43.1 million and $77.9 million, respectively, due to strong performance in VIP ticketing, core management services, non-artist management services
and strategic acquisitions.

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Three Months Ended June 30,

Six Months Ended June 30,2009

2008

% Change

2009

2008

% Change(Dollars in thousands)Revenue:Ticketing

$
311,917

$
382,369


(18)%

$
650,927

$
731,350


(11)%Artist services


43,139





NM


77,945





NMTotal revenue

$
355,056

$
382,369


(7)%

$
728,872

$
731,350


NM


Cost of Sales



Three Months Ended June 30,

Six Months Ended June 30,2009

2008

% Change

2009

2008

% Change(Dollars in thousands)Cost of sales


$220,807


$248,549

(11)%


$453,367


$469,571


(3)%As a percentage of total revenue


62%


65%

(281)bp


62%


64%


(200)bpGross margins


38%


35%

281bp


38%


36%


200bp


Cost
of sales consists primarily of ticketing royalties, as well as compensation and other employee-related costs (including stock-based compensation) for personnel engaged in call
center functions and credit card processing fees. Ticketing royalties relate to our client's share of convenience and order processing charges. In our Artist Services segment, merchandise inventory,
related shipping costs and costs associated with VIP ticket packages are recorded as cost of sales.

Cost
of sales for the quarter ended June 30, 2009 decreased $27.7 million from the prior-year quarter, primarily due to decreases of $15.4 million in
ticketing royalties, $10.6 million in compensation and other employee-related costs and $4.4 million in credit card processing fees. The decrease in ticketing royalties and credit card
processing fees was primarily due to lower convenience and processing revenues. The decrease in compensation and other employee-related costs was due in part to a reduction in headcount. These
decreases were partially offset by $16.4 million of merchandise inventory and related shipping costs related to Front Line, in which the Company acquired a majority interest in October 2008.
Excluding the impact of Front Line, cost of sales decreased $44.2 million, or 18%.

Cost
of sales for the six months ended June 30, 2009 decreased $16.2 million from 2008, primarily due to decreases of $20.8 million in ticketing royalties,
$15.9 million in compensation and other employee-related costs and $3.4 million in credit card processing fees. The decrease in ticketing royalties and credit card processing fees was
primarily due to lower convenience and processing revenues. The decrease in compensation and other employee-related costs was due in part to a reduction in headcount. These decreases were partially
offset by $34.2 million of merchandise inventory and related shipping costs related to Front Line, in which the Company acquired a majority interest in October 2008. Excluding the impact of
Front Line, cost of sales decreased $50.4 million, or 11%.

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Selling and marketing expense



Three Months Ended June 30,

Six Months Ended June 30,2009

2008

% Change

2009

2008

% Change(Dollars in thousands)Selling and marketing expense


$19,590


$24,636


(20)%


$43,885


$44,029


NMAs a percentage of total revenue


6%


6%


(93)bp


6%


6%


NM


Selling
and marketing expense consists primarily of advertising and promotional expenditures and compensation and other employee-related costs (including stock-based compensation) for
personnel engaged in customer service and sales functions. Advertising and promotional expenditures primarily include online marketing, including fees paid to search engine and distribution partners,
as well as offline marketing, including sports sponsorship marketing and radio spending. Sports sponsorship agreements are intended to promote Ticketmaster Entertainment's ticket resale services.

Selling
and marketing expense for the three months ended June 30, 2009 decreased $5.0 million from the prior-year quarter, primarily due to a decrease of
$4.6 million in advertising and promotional expenditures. The decrease in advertising and promotional expenditures was due, in part, to a decrease in sports sponsorship marketing expense and
fees paid to search engine partners for online marketing.

Selling
and marketing expense for the six months ended June 30, 2009 was flat compared to the prior-year period primarily due to an increase in sports sponsorship
marketing expense and fees paid to search engine partners for online marketing, offset by lower expenses in other advertising expense categories.

General and administrative expense



Three Months Ended June 30,

Six Months Ended June 30,2009

2008

% Change

2009

2008

% Change(Dollars in thousands)General and administrative expense


$64,701


$45,644


42%


$128,904


$87,497


47%As a percentage of total revenue


18%


12%


629bp


18%


12%


572bp


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

General
and administrative expense for the three months ended June 30, 2009 increased $19.1 million from the prior-year quarter, primarily due to increases of
$9.0 million in compensation and other employee-related costs and $5.8 million in professional fees. The increase in compensation and other employee-related costs was primarily due to an
increase of $11.9 million of Front Line compensation which was not included in the prior-year quarter, partially offset by cost savings from our restructuring plan. General and
administrative expense includes non-cash compensation expense of $6.1 million and $6.0 million for the three months ended June 30, 2009 and 2008, respectively. The
increase in professional fees was primarily due to $8.5 million of legal and professional fees incurred in connection with the pending merger with Live Nation, partially offset by lower costs
for other professional services. Excluding the impact of Front Line, general and administrative expense increased $2.4 million, or 5%.

General
and administrative expense for the six months ended June 30, 2009 increased $41.4 million from the prior-year period, primarily due to increases of
$18.6 million in compensation and other

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employee-related
costs and $14.1 million in professional fees. The increase in compensation and other employee-related costs was primarily due to $24.1 million of Front Line compensation
which was not included in the prior-year period, partially offset by cost savings from our restructuring plan. General and administrative expense includes non-cash compensation
expense of $12.1 million for the six months ended June 30, 2009 compared with $10.3 million in the prior-year period. The increase in non-cash compensation
was primarily due to the modification of existing stock-based compensation awards in connection with the spin-off, the grant of new awards subsequent to the spin-off and the
grants of awards in connection with 2008 acquisitions. The increase in professional fees was primarily due to $14.4 million of legal and professional fees incurred in connection with the
pending merger with Live Nation. Excluding the impact of Front Line, general and administrative expense increased $8.9 million, or 10%.

Depreciation



Three Months Ended June 30,

Six Months Ended June 30,2009

2008

% Change

2009

2008

% Change(Dollars in thousands)Depreciation


$14,079


$11,828


19%


$26,479


$22,883


16%As a percentage of total revenue


4%


3%


87bp


4%


3%


50bp


Depreciation
for the three and six months ended June 30, 2009 increased $2.3 million and $3.6 million, respectively, from 2008 primarily due to the incremental
depreciation associated with the impact of recent acquisitions which were not included in the prior-year periods.

Adjusted EBITDA

Adjusted EBITDA is a supplemental measure and is defined in "Ticketmaster Entertainment's Principles of Financial Reporting," below.



Three Months Ended June 30,

Six Months Ended June 30,2009

2008

% Change

2009

2008

% Change(Dollars in thousands)Adjusted EBITDA:Ticketing

$
63,965

$
84,565


(24)%

$
143,986

$
172,570


(17)%Artist services


13,673





NM


18,102





NMCorporate and unallocated


(21,349
)

(14,397
)

48%


(46,770
)

(30,924
)

51%Total Adjusted EBITDA

$
56,289

$
70,168


(20)%

$
115,318

$
141,646


(19)%


Adjusted
EBITDA for the three months ended June 30, 2009 decreased $13.9 million from the prior-year quarter, due to lower sales volumes and increases in
general and administrative expense, partially offset by lower cost of sales and selling and marketing expense,
discussed above. Excluding the impact of the Company's acquisition of a majority interest in Front Line in October 2008, Adjusted EBITDA decreased $27.6 million, or 39%.

Adjusted
EBITDA for the six months ended June 30, 2009 decreased $26.3 million from the prior-year period, due to lower sales volumes and increases in general
and administrative expense, partially offset by lower cost of sales, discussed above. Excluding the impact of the Company's acquisition of a majority interest in Front Line in October 2008, Adjusted
EBITDA decreased $44.4 million, or 31%.

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Operating income



Three Months Ended June 30,

Six Months Ended June 30,2009

2008

% Change

2009

2008

% Change(Dollars in thousands)Operating income (loss):Ticketing

$
37,487

$
58,459


(36)%

$
97,575

$
124,954


(22)%Artist services


1,256





NM


(5,504
)




NMCorporate and unallocated


(23,721
)

(18,282
)

30%


(51,749
)

(37,987
)

36%Total operating income

$
15,022

$
40,177


(63)%

$
40,322

$
86,967


(54)%


Operating
income for the three months ended June 30, 2009 decreased $25.2 million from the prior-year quarter, primarily due to the decrease in Adjusted EBITDA
described above and increases of $9.3 million in amortization of intangibles. The increase in intangible amortization expense was due to the acceleration of amortization expense of
$5.1 million related to certain international ticketing agreement intangible assets and incremental amortization expense from the impact of recent acquisitions which were not included in the
prior-year quarter.
Excluding the impact of the Company's acquisition of a majority interest in Front Line in October 2008, operating income decreased $26.4 million or 66%.

Operating
income for the six months ended June 30, 2009 decreased $46.6 million from the prior-year period, primarily due to the decrease in Adjusted EBITDA
described above and increases of $15.5 million in amortization of intangibles and $1.2 million in non-cash compensation expense. The increase in intangible amortization
expense was due to the acceleration of amortization expense of $5.1 million related to certain international ticketing agreement intangible assets and incremental amortization expense from the
impact of recent acquisitions which were not included in the prior-year period. Excluding the impact of the Company's acquisition of a majority interest in Front Line in October 2008,
operating income decreased $41.1 million or 47%.

Corporate and unallocated expenses

Corporate and unallocated expenses primarily include compensation and other employee costs (including stock-based compensation),
outside services and professional fees. Corporate and unallocated expenses for the three months and six months ended June 30, 2009 increased $5.4 million and $13.8 million,
respectively, from the prior-year periods primarily due to higher legal and professional fees associated with the pending merger with Live Nation and professional services related to
operating as a publicly traded company.

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Other expense, net



Three Months Ended June 30,

Six Months Ended June 30,2009

2008

% Change

2009

2008

% Change(Dollars in thousands)Other expense, net:Interest income

$
727

$
3,463


(79)%

$
1,368

$
6,753


(80)%Interest expense


(15,419
)

(8,901
)

73%


(33,575
)

(9,636
)

NMEquity in income of unconsolidated affiliates


545


(1,468
)

NM


1,888


(802
)

NMOther income (expense)


3,730


(287
)

NM


3,539


657


NM


Interest income

Interest income in 2009 for the three and six months ended June 30, 2009 decreased $2.7 million and $5.4 million,
respectively, from the prior-year periods primarily due to the extinguishment of intercompany receivables from IAC upon the consummation of the spin-off and lower average
interest rates.

Interest expense

Interest expense for the three and six months ended June 30, 2009 increased $6.5 million and $23.9 million,
respectively, from the prior-year periods. The increase was primarily due to interest expense and amortization of debt issuance costs of $15.0 million and $32.6 million for
the three and six months ended June 30, 2009, respectively, related to our Senior Notes and our Senior Secured Credit Facilities, partially offset by an $8.3 million cumulative interest
charge from IAC in the second quarter of 2008.

Equity in income of unconsolidated affiliates

Equity in the income of unconsolidated affiliates for the three and six months ended June 30, 2009 increased $2.0 million
and $2.7 million, respectively, from the prior-year periods, primarily due to increased earnings at the Company's joint venture in Mexico.

Other income (expense)

Other income (expense) in 2009 for the three and six months ended June 30, 2009 increased $4.0 million and
$2.9 million, respectively, from the prior-year periods due to gains on foreign currency exchange primarily related to the Company's operating activities in Canada and the United
Kingdom due to the strengthening of the U.S. dollar compared to the Canadian dollar and the British Pound.

Income tax provision

For the three months ended June 30, 2009 and 2008, Ticketmaster Entertainment recorded tax provisions of $1.5 million and
$10.9 million, respectively, which represent an effective tax rate of 33% for both periods. The 2009 tax rate is lower than the federal statutory rate of 35% due principally to foreign income
taxed at lower rates including the effects of our international restructuring, foreign tax credits related to foreign dividends, deductible payments made in connection with a Front Line dividend and
net adjustments related to the reconciliation of provision accruals to tax returns, partially offset by losses in foreign jurisdictions for which no tax benefit can be recognized. The 2008 tax rate is
lower than the federal statutory rate of 35% primarily due to foreign income taxed at lower rates and

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foreign
tax credits related to foreign dividends, partially offset by losses in foreign jurisdictions for which no tax benefit can be recognized and state and local income taxes.

For
the six months ended June 30, 2009 and 2008, Ticketmaster Entertainment recorded tax provisions of $5.7 million and $29.7 million, respectively, which represent
effective tax rates of 42% and 35%, respectively. The 2009 tax rate is higher than the federal statutory rate of 35% due principally to losses in foreign jurisdictions for which no tax benefit can be
recognized and adjustments to deferred taxes due to newly enacted state tax legislation, partially offset by foreign income taxed at lower rates including the effects of our international
restructuring and foreign tax credits related to foreign dividends. Excluding the effects of the newly enacted state tax legislation, the Company's effective tax rate would have been 31%. The 2008 tax
rate approximates the federal statutory rate of 35% primarily due to losses in foreign jurisdictions for which no tax benefit can be recognized and state and local income taxes, offset by foreign
income taxed at lower rates and foreign tax credits related to foreign dividends.

As
of December 31, 2008 and June 30, 2009, the Company had unrecognized tax benefits of approximately $1.3 million and $3.7 million, respectively. During the
three and six months ended June 30, 2009, the unrecognized tax benefits increased by approximately $1.4 million and $2.4 million, respectively, as a result of historical state tax
positions and foreign income tax positions taken in the current year. The Company recognizes interest and, if applicable, penalties related to unrecognized tax benefits in income tax expense. Included
in income tax expense for the three and six months ended June 30, 2009 is $0.2 million, net of related deferred taxes, for interest and penalties on unrecognized tax benefits. At
June 30, 2009, the Company had accrued $0.6 million for the payment of interest and penalties.

By
virtue of previously filed separate company tax returns, as well as consolidated tax returns with IAC, Ticketmaster Entertainment is routinely under audit by federal, state, local and
foreign income tax authorities. These audits include questioning the timing and the amount of deductions and the
allocation of income among various tax jurisdictions. Income taxes payable include amounts considered sufficient to pay assessments that may result from examination of prior year returns; however, the
amount paid upon resolution of issues raised may differ from the amount provided. Differences between the amounts recorded for unrecognized tax benefits and the amounts owed by Ticketmaster
Entertainment are recorded in the period they become known. Ticketmaster Entertainment believes that it is reasonably possible that its unrecognized tax benefits could decrease by approximately
$1.4 million within twelve months of the current reporting date due to settlements and expirations of applicable statute of limitations. An estimate of other changes in unrecognized tax
benefits cannot be made, but such other changes are not expected to be significant.

Segment Operating Results

The overall concept that Ticketmaster Entertainment employs in determining its operating segments is to present the financial
information in a manner consistent with how our chief operating decision maker manages our business, makes operating decisions and evaluates operating performance. Operating segments are consolidated
for reporting purposes if they have similar economic characteristics and meet the aggregation criteria of SFAS No. 131.

Prior
to the acquisition of a controlling interest in Front Line, Ticketmaster Entertainment had one operating segment in accordance with its internal management structure and based upon
how the chief operating decision maker viewed the business, its organizational structure and the type of service provided which primarily was online and offline ticketing services.

After
the October 29, 2008 acquisition of Front Line, based upon changes in the internal management structure and how the chief operating decision maker viewed the business, the
Company began reporting two segments: Ticketing and Artist Services.

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The
Ticketing segment is primarily an agency business that sells tickets for events on behalf of our clients and retains a convenience charge and order processing fee for our services.
We sell tickets through a combination of websites, telephone services and ticket outlets.

The
Artist Services segment primarily provides management services to music recording artists in exchange for a commission on the earnings of these artists. Artist Services also sells
merchandise
associated with musical artists at live musical performances, to retailers, and directly to consumers via a website.

For
additional information about our segment results, refer to Note 3Segment Information in the Notes to Unaudited Consolidated Financial Statements.

LIQUIDITY AND CAPITAL RESOURCES

As of June 30, 2009, Ticketmaster Entertainment had $616.1 million of cash and cash equivalents including
$373.5 million in funds representing amounts equal to the face value of tickets sold on behalf of clients ("client funds"). Ticketmaster Entertainment's $616.1 million of cash and cash
equivalents included approximately $373.5 million which were maintained principally in Canada, the United Kingdom, Ireland and Australia; of this balance, $227.5 million were client
funds. The Company does not utilize client funds for its own financing or investing activities as the amounts are payable to clients.

Net
cash provided by operating activities was $183.7 million and $108.7 million for the six months ended June 30, 2009 and 2008, respectively. The increase of
$75.0 million in net cash provided by operating activities reflected higher contributions from client funds of $61.6 million and the timing of settlements with clients. Other increases
were due to favorable changes in working capital, which included the timing of settlements for accrued liabilities, accounts receivable and accounts payable. These increases in net cash provided by
operating activities were partially offset by debt interest payments in 2009 which were not made in 2008 and a decline in operating results.

Net
cash used in investing activities in the six months ended June 30, 2009 of $47.1 million primarily resulted from cash paid for capital expenditures of
$23.8 million and $24.6 million for the acquisition of an artist management company. Net cash used in investing activities in the six months ended June 30, 2008 of
$563.1 million primarily resulted from cash transfers to IAC of $141.9 million, acquisitions, net of cash acquired, of $393.5 million and capital expenditures of
$23.2 million. The cash transfers related to IAC's centrally managed U.S. treasury function. Acquisitions, net of cash acquired, primarily related to the acquisitions of TicketsNow, Paciolan
and GET ME IN!.

Net
cash used in financing activities in the six months ended June 30, 2009 of $7.2 million was primarily due to principal payments on capital leases and distributions to
minority interest holders. Net cash provided by financing activities of $392.7 million in the six months ended June 30, 2008 was primarily due to capital contributions from IAC of
$393.5 million to fund Ticketmaster Entertainment's acquisitions.

Ticketmaster
Entertainment anticipates that it will need to make capital and other expenditures in connection with the development and expansion of its operations. Ticketmaster
Entertainment's ability to fund its cash and capital needs will be affected by its ongoing ability to generate cash from operations and the overall capacity and terms of its financing arrangements.
Ticketmaster Entertainment believes that its cash on hand, excluding client funds, along with its anticipated operating cash flow in 2009 and its access to financing arrangements are sufficient to
fund operating needs, capital, investing and other commitments and contingencies for the foreseeable future.

Under
the Company's Senior Secured Credit Facilities and the indenture governing the Company's Senior Notes, the Company is required to comply with certain financial covenants. The
Senior Notes contain two incurrence-based financial covenants, requiring that the Company meet a minimum fixed charge coverage ratio, as defined therein, of 2.0 to 1.0 and a maximum secured leverage
ratio, as

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defined
therein, of 2.25 to 1.0 in order to incur additional indebtedness, other than permitted debt. The senior secured credit facility has two maintenance-based quarterly financial covenants,
requiring a maximum total leverage ratio of 3.5 to 1.0 and a minimum interest coverage ratio of 3.0 to 1.0. The total leverage ratio for the Senior Secured Credit Facilities, calculated as total debt,
as defined therein, divided by total earnings before interest, taxes, depreciation and amortization ("EBITDA"), as defined therein, for the trailing twelve-month period is the most sensitive to
change, as debt levels increase and/or earnings decline. As of June 30, 2009, the Company was in compliance with all maintenance-based financial covenants.

The
Company believes it has adequate cash and cash equivalents and it will generate sufficient cash from operations to pay-down a portion of its debt, if required, in order
to maintain compliance with all financial covenants through December 31, 2009. Ticketmaster Entertainment may, from time to time, engage in open market purchases of its Notes. In July 2009, we
repurchased and retired $13 million aggregate principal amount of our Senior Notes.

In
the event that the proposed merger with Live Nation is consummated, we expect that our cost of capital related to our bank financing will increase as a result of obtaining amendments
to our senior secured credit facilities required for the proposed merger.

Critical Accounting Policies and Estimates

Refer to the discussion of our accounting policies in our audited consolidated financial statements and notes for the year ended
December 31, 2008, which are included in our Annual Report on Form 10-K, as amended, filed with the SEC.

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

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

Recent Accounting Pronouncements

Refer to the discussion of our accounting policies in our audited consolidated financial statements and notes for the year ended
December 31, 2008, which are included in our Annual Report on Form 10-K, as amended, filed with the SEC. In addition, refer to Note 2-Summary of Recent
Accounting Standards in the Notes to Unaudited Consolidated Financial Statements.

TICKETMASTER ENTERTAINMENT'S PRINCIPLES OF FINANCIAL REPORTING

Ticketmaster Entertainment reports Adjusted EBITDA as a supplemental measure to GAAP. This measure is one of the primary metrics by
which Ticketmaster Entertainment evaluates the performance of its segments and businesses, on which its internal budgets are based and by which management is compensated. Ticketmaster Entertainment
believes that investors should have access to the same set of tools that it uses in analyzing its results. This supplemental measure should be considered in addition to results prepared in accordance
with GAAP, but should not be considered a substitute for or superior to GAAP results. Ticketmaster Entertainment provides and encourages investors to examine the

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reconciling
adjustments between the GAAP measure and supplemental measure which are discussed below.

Definition of Ticketmaster Entertainment's Supplemental Measure

Adjusted Earnings before Interest, Income Taxes, Depreciation and Amortization ("Adjusted EBITDA"), is defined as operating income
excluding, if applicable: (1) depreciation expense, (2) non-cash compensation expense, (3) amortization and impairment of intangibles, (4) goodwill and other
impairments, (5) pro forma adjustments for significant acquisitions, fair value adjustments to contingent consideration and executive compensation expense associated with significant
transactions or the Merger with Live Nation and (6) one-time items. Ticketmaster Entertainment believes this measure is useful to investors because it represents the operating
results from Ticketmaster Entertainment businesses excluding the effects of non-cash expenses. The Adjusted EBITDA metric was named Adjusted Operating Income in our Annual Report on
Form 10-K, as amended, for the year ended December 31, 2008. Adjusted EBITDA has certain limitations in that it does not take into account the impact to Ticketmaster
Entertainment's statement of operations of certain expenses, including acquisition-related accounting. Ticketmaster Entertainment endeavors to compensate for the limitations of the supplemental
measure presented by also providing the comparable GAAP measure with equal or greater prominence and descriptions of the reconciling items, including quantifying such items, to derive the supplemental
measure.

Pro Forma Results

Ticketmaster Entertainment will only present Adjusted EBITDA on a pro forma basis if a particular transaction is significant within the
meaning of Rule 11-01 of Regulation S-X or if it views a transaction as so significant in nature that disclosure of pro forma financial information would be
material to investors. For the periods presented in this report, there are no transactions that Ticketmaster Entertainment has included on a pro forma basis.

One-Time Items

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

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

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

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

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RECONCILIATION OF ADJUSTED EBITDA

For a reconciliation of Adjusted EBITDA to Net income attributable to Ticketmaster Entertainment, Inc. for the three and six
months ended June 30, 2009 and 2008, see Note 3Segment Information in Notes to Unaudited Consolidated Financial Statements.

Item 3.Quantitative and Qualitative Disclosures about Market Risk

For quantitative and qualitative disclosures about market risk, refer to Part II, Item 7A Quantitative and Qualitative
Disclosure about Market Risk which is included in our Annual Report on Form 10-K, as amended, for the year ended December 31, 2008. Our exposure to market risk has not
changed materially since December 31, 2008.

Item 4(T).Controls and Procedures

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

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

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

As
required by Rule 13a-15(d) under the Exchange Act, we, under the supervision and with the participation of our management, including the Chief Executive Officer and
Chief Financial Officer, also evaluated whether any changes occurred to our internal control over financial reporting during the period covered by this report that have materially affected, or are
reasonably likely to materially affect, such control. Based on that evaluation, there has been no such change during the period covered by this report.

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PART IIOTHER INFORMATION

Item 1.Legal Proceedings



On October 21, 2003, a purported representative action was filed in California state court, challenging Ticketmaster
Entertainment's charges to online customers for UPS ticket delivery. The complaint alleged in essence that it is unlawful for Ticketmaster Entertainment not to disclose on its website that the fee it
charges to online customers to have their tickets delivered by UPS contains a profit component. The complaint asserted a claim for violation of California's Unfair Competition Law or "UCL," codified
at California Business and Professions Code section 17200et seq.,and sought restitution or disgorgement of the difference between
(i) the total UPS delivery fees charged by Ticketmaster Entertainment in connection with online ticket sales during the applicable statute of limitations period, and (ii) the amount
Ticketmaster Entertainment paid to UPS for that service.

On
July 20, 2004, Ticketmaster filed a motion for summary judgment. The Court heard the motion on December 20, 2004, and denied Ticketmaster's motion, in part, based on
Plaintiffs' arguments that they were not challenging Ticketmaster's rights to make a profit, but instead were only challenging Ticketmaster's UPS delivery charges based on Plaintiffs' "misleading
pass-through" theory of liability.

On
December 7, 2004, Ticketmaster filed its first motion for judgment on the pleadings based on the passage of Proposition 64, which became effective in November 2004. Plaintiffs
opposed the motion. The Court heard the motion on April 1, 2005, and explained that Plaintiffs could not proceed with a representative action without amending the complaint to comply with class
action procedures.

On
August 31, 2005, the plaintiffs filed their first amended complaint, for the first time pleading this case as a putative class action. The first amended complaint alleged
(i) as before, that Ticketmaster Entertainment's website disclosures in respect of its charges for UPS ticket delivery violate the UCL , and (ii) for the first time, that Ticketmaster
Entertainment's website disclosures in respect of its ticket order-processing fees constitute false advertising in violation of California's False Advertising Law or "FAL," codified at California
Business and Professions Code sections 17500et seq.On this latter claim, the amended complaint seeks restitution or disgorgement of the entire
amount of order-processing fees charged by Ticketmaster Entertainment during the applicable statute of limitations period.

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

On
September 20, 2007, the Court heard Plaintiffs' motion for class certification. On December 19, 2007, the Court issued an Order denying the motion without prejudice and
continuing the stay of the case pending resolution ofIn re Tobacco II(the lead case before the Supreme Court on the relevant issues).

On
May 18, 2009, the California Supreme Court decided theTobacco IIcase. On April 1, 2009, the Court granted plaintiff's
motion for leave to file a Second Amended Complaint that purports to clarify plaintiff's existing claims under the UCL and FAL and adds new claims that (a) Ticketmaster Entertainment's
order processing fees are unconscionable under the UCL and (b) Ticketmaster's alleged business practices violate the "unlawful" prong of the UCL because they also allegedly constitute an
underlying violation of California's Consumer Legal Remedies Act (codified at California

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Civil
Code sections 1750et seq.). Ticketmaster Entertainment filed a demurrer to the Second Amended Complaint on May 8, 2009. Plaintiffs
have filed a Third Amended Complaint to attempt to cure deficiencies in the Second Amended Complaint and to seek to address the California Supreme Court's holding inTobacco
II.Ticketmaster Entertainment filed a demurrer to the Third Amended Complaint on July 3. The parties have stipulated to a hearing on the demurrer on August 7,
2009. Ticketmaster Entertainment expects Plaintiffs to file another class certification motion within the next 60-90 days.



On November 30, 2001, a purported securities class action was filed against Ticketmaster Entertainment and other defendants in
the U.S. District Court for the Southern District of New York. Plaintiff's suit was brought on behalf of purchasers of Ticketmaster Entertainment common stock during the period from the date of its
initial public offering through December 6, 2000, and alleged violations by Ticketmaster Entertainment of Section 10(b) of the Exchange Act and Section 11 of the Securities Act.
Plaintiff alleged that Ticketmaster Entertainment failed to disclose that its underwriters were to receive undisclosed and excessive compensation and had agreed to allocate shares in the IPO to
customers in exchange for agreements to purchase shares in the aftermarket at pre-determined prices. This action was later consolidated with hundreds of similar actions against issuers and
underwriters in the U.S. District Court for the Southern District of New York inIn re Initial Public Offering Securities Litigation, No. 21 MC
92 (S.D.N.Y.). On February 19, 2003, the court granted a motion to dismiss the Section 10(b) claim against Ticketmaster Entertainment, but denied the motion as to the Section 11
claim against Ticketmaster Entertainment. On October 13, 2004, the district court granted a motion for class certification in the six so-called class certification "focus" cases in
the consolidated litigation. Ticketmaster Entertainment is not a party in any of these focus cases. On December 5, 2006, the U.S. Court of Appeals for the Second Circuit reversed the trial
court's decision. On August 14, 2007, plaintiffs filed amended complaints containing new class definitions in the six class certification focus cases. On November 13, 2007, the issuer
defendants filed a motion to dismiss the amended complaints in the focus cases. On March 26, 2008, the district court granted this motion in part and denied it in part.
Accordingly, this action remains pending against Ticketmaster Entertainment. The plaintiffs had filed a motion for class certification in the six class certification focus cases, however, on
October 3, 2008, plaintiffs requested to withdraw that motion without prejudice. On October 10, 2008, the Court granted that request. On April 2, 2009, a proposed settlement among
the parties in the consolidated litigation was filed with the Court, which, if finally approved by the Court, would result in the dismissal of the claims against the Company with prejudice. On
June 9, 2009, the Court granted preliminary approval to the proposed settlement and scheduled a settlement fairness hearing for September 10, 2009.



In February of 2009, five putative consumer class action complaints were filed in Canada against TNow Entertainment Group, Inc.,
Ticketmaster Entertainment, Ticketmaster Canada Ltd., and Premium Inventory, Inc. All of the cases allege essentially the same set of facts and causes of action: each plaintiff purports
to represent a class consisting of all persons who purchased a ticket from Ticketmaster Entertainment, Ticketmaster Canada or TicketsNow from early February of 2007 to the present. Each proposed class
purports to extend to United States as well as Canadian consumers. The complaints allege in essence that Ticketmaster Entertainment and Ticketmaster Canada conspired to divert a large number of
tickets for resale through the TicketsNow website at prices higher than face value in violation of Ontario's Ticket Speculation Act, the Amusement Act of Manitoba, the Amusement Act of Alberta, and
the Quebec Consumer Protection Act, respectively. The Ontario case contains the additional allegation that Ticketmaster Entertainment and TicketsNow's service fees run afoul of
anti-scalping laws. Each lawsuit seeks compensatory and punitive damages on behalf of the class.

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From February through June of 2009, eleven purported class action lawsuits asserting causes of action under various state consumer
protection laws were filed against Ticketmaster Entertainment and TicketsNow in District Courts in California, New Jersey, Minnesota, Pennsylvania, and North Carolina. The lawsuits allege that
Ticketmaster and TicketsNow unlawfully deceived consumers by, among other things, selling large quantities of tickets to TicketsNow's ticket brokers, either prior to or at the time that tickets for an
event go on sale, thereby forcing consumers to purchase tickets at significantly marked-up prices on TicketsNow instead of Ticketmaster.com. Plaintiffs further claim that Ticketmaster
Entertainment violated various state consumer protection laws by allegedly "redirecting" consumers from Ticketmaster.com to
Ticketsnow.com, thereby engaging in false advertising and an unfair business practice by deceiving consumers into inadvertently purchasing tickets from TicketsNow for amounts greater than face value.
Plaintiffs claim that Ticketmaster Entertainment has been unjustly enriched by this conduct and seek compensatory damages, a refund to every class member of the difference between face value and the
amount paid to TicketsNow, an injunction preventing Ticketmaster Entertainment from engaging in further unfair business practices with TicketsNow, and attorney fees and costs. On July 20, 2009,
all of the cases were consolidated and transferred to the Central District of California. A consolidated class action complaint must be filed no later than August 20, 2009. Ticketmaster
Entertainment will have 30 days to respond.



Ticketmaster Entertainment and each of its directors have been named as defendants in two lawsuits filed in the Superior Court of
California, Los Angeles County, challenging the Merger:McBride v. Ticketmaster Entertainment, Inc., No. BC407677, and Police and Fire Retirement System of the City of
Detroit v. Ticketmaster Entertainment, Inc., No. BC408228. These actions were consolidated under
the captionIn re Ticketmaster Entertainment Shareholder Litigation, Lead Case No. BC407677, by a court order dated March 30, 2009. The
plaintiffs filed an amended complaint in the consolidated action on July 2, 2009. The consolidated amended complaint generally alleges that Ticketmaster Entertainment and its directors breached
their fiduciary duties by entering into the Merger Agreement without regard to the fairness of the Merger Agreement to the Ticketmaster Entertainment stockholders and by failing to obtain the best
possible value for shares of Ticketmaster Entertainment common stock. The consolidated amended complaint also alleges that the amended proxy statement jointly filed on Form S-4/A by
Live Nation and Ticketmaster Entertainment with the Securities and Exchange Commission on July 1, 2009, contains material omissions and misstatements. Live Nation and its financial advisors,
Goldman Sachs and Deutsche Bank, and Ticketmaster Entertainment's financial advisor, Allen & Co., are also named as defendants in the consolidated action and are charged with aiding and
abetting the Ticketmaster Entertainment directors' alleged breaches of fiduciary duty. Among other things, the consolidated amended complaint seeks an injunction barring the completion of the Merger
until an adequate proxy statement is filed and Ticketmaster Entertainment and its directors have completed a process for selling Ticketmaster Entertainment or evaluating its strategic alternatives
that produces the greatest possible consideration for shares of Ticketmaster Entertainment common stock, rescission of the Merger Agreement, compensatory damages, and attorneys' fees and expenses.
Ticketmaster Entertainment believes the consolidated amended complaint is without merit and intends to defend the consolidated action vigorously.

Item 1A.Risk Factor

Cautionary Statements Regarding Forward-Looking Information

This Quarterly Report on Form 10-Q contains "forward-looking statements" within the meaning of the Private
Securities Litigation Reform Act of 1995. The use of words such as "anticipates," "estimates," "expects," "projects," "intends," "plans" and "believes," among others, generally identify

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forward-looking
statements. These forward-looking statements include, among others, statements relating to: Ticketmaster Entertainment's anticipated financial performance, business prospects and,
anticipated trends and prospects in the various industries in which Ticketmaster Entertainment businesses operate, new products, services and related strategies and other similar matters. These
forward-looking statements are based on management's current expectations and assumptions about future events, which are inherently subject to uncertainties, risks and changes in circumstances that
are difficult to predict.

Actual
results could differ materially from those contained in the forward-looking statements included in this report for a variety of reasons, including, among others, the risk factors
set forth below. Other unknown or unpredictable factors that could also adversely affect Ticketmaster Entertainment's business, financial condition and results of operations may arise from time to
time. In light of these risks and uncertainties, the forward-looking statements discussed in this report may not prove to be accurate. Accordingly, you should not place undue reliance on these
forward-looking statements, which only reflect the views of our management as of the date of this report. Ticketmaster Entertainment does not undertake to update these forward-looking statements.

Risk Factors

In addition to the other information set forth in this report, you should carefully consider the factors discussed in Part I,
"Item 1A. Risk Factors" in our Annual Report on Form 10-K, as amended, for the year ended December 31, 2008, and in Part II, "Item 1A. Risk Factors" in
our Quarterly Report on Form 10-Q for the quarter ended March 31, 2009, which could materially affect our business, financial condition or future results. The risks described
in the foregoing reports are not the only risks facing our Company. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially
adversely affect our business, financial condition and/or operating results.

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Item 6.Exhibits

Exhibit

Description10.1

Amendment No. 1, dated as of May 12, 2009, to the Credit Agreement dated as of July 25, 2008, among Ticketmaster Entertainment, Inc. (f/k/a Ticketmaster), the Guarantors party thereto, the Lenders
party thereto and JPMorgan Chase Bank, N.A., as Administrative Agent and Collateral Agent (incorporated by reference to Exhibit 10.5 of Live Nation, Inc.'s Registration Statement on Form S-4, filed June 15, 2005).10.2

Second Supplemental Indenture, dated as of April 30, 2009, to the Indenture, dated as of July 28, 2008, among Ticketmaster, as Issuer, the Guarantors identified therein and The Bank of New York Mellon, as
Trustee10.3

Third Supplemental Indenture, dated as of July 23, 2009, to the Indenture, dated as of July 28, 2008, among Ticketmaster, as Issuer, the Guarantors identified therein and The Bank of New York Mellon, as
Trustee31.1

CEO Certification Pursuant to Section 302(a) of the Sarbanes-Oxley Act of 200231.2

CFO Certification Pursuant to Section 302(a) of the Sarbanes-Oxley Act of 200232.1

CEO and CFO Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002


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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.

TICKETMASTER ENTERTAINMENT, INC.
                             (Registrant)Date: August 13, 2009

By:

/s/ BRIAN REGAN Brian Regan Executive Vice President and Chief Financial Officer


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