TICKETMASTER ONLINE CITYSEARCH INC, S-1/A, 1998-11-06

TICKETMASTER ONLINE CITYSEARCH INC
S-1/A, 1998-11-06
COMPUTER PROCESSING & DATA PREPARATION

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AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON NOVEMBER 6, 1998
REGISTRATION NO. 333-64855
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

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AMENDMENT NO. 2 TO
FORM S-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933

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TICKETMASTER ONLINE-CITYSEARCH, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)

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DELAWARE 7375 95-4546874
(STATE OR OTHER JURISDICTION OF (PRIMARY STANDARD INDUSTRIAL (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) CLASSIFICATION CODE NUMBER) IDENTIFICATION NUMBER)
</TABLE>

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TICKETMASTER ONLINE-CITYSEARCH, INC.
790 E. COLORADO BOULEVARD, SUITE 200, PASADENA, CA 91101, (626) 405-0050
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF
REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)

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CHARLES CONN, CHIEF EXECUTIVE OFFICER
TICKETMASTER ONLINE-CITYSEARCH, INC.
790 E. COLORADO BOULEVARD, SUITE 200, PASADENA, CA 91101, (626) 405-0050
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE,
OF AGENT FOR SERVICE)

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COPIES TO:

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<S> <C> <C>
LARRY W. SONSINI PAMELA S. SEYMON GLEN R. VAN LIGTEN
JOHN T. SHERIDAN ANDREW J. NUSSBAUM CRAIG E. SHERMAN
JULIE A. BELL WACHTELL, LIPTON, ROSEN & KATZ EDWARD Y. KIM
EILEEN MARSHALL 51 WEST 52ND STREET ROBERT S. SCHLOSSMAN
WILSON SONSINI GOODRICH & ROSATI NEW YORK, NY 10019 VENTURE LAW GROUP
PROFESSIONAL CORPORATION (212) 403-1000 A PROFESSIONAL CORPORATION
650 PAGE MILL ROAD 2800 SAND HILL ROAD
PALO ALTO, CA 94304 MENLO PARK, CA 94025
(650) 493-9300 (650) 854-4488
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APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon as
practicable after the effective date of this Registration Statement.

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If any securities being registered on this Form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, check the following box. [_]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following
box and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [_]
If this form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [_]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [_]
If this form is a post-effective amendment filed pursuant to Rule 462(d)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [_]

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CALCULATION OF REGISTRATION FEE
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PROPOSED
MAXIMUM
TITLE OF EACH CLASS OF AMOUNT TO PROPOSED AGGREGATE AMOUNT OF
SECURITIES TO BE BE MAXIMUM OFFERING OFFERING REGISTRATION
REGISTERED REGISTERED(1) PRICE PER SHARE PRICE(1)(2) FEE
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Class B Common Stock
$0.01 par value....... 8,050,000 $10.00 $80,500,000 $22,379 (3)
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(1) The Company has granted to the Underwriters a 30-day option to purchase up
to an additional 1,050,000 shares of Class B Common Stock solely to cover
over-allotments, if any.
(2) Estimated solely for the purpose of computing the amount of the
registration fee pursuant to Rule 457(a) promulgated under the Securities
Act of 1933, as amended.

(3) $27,140 was previously paid in connection with the Registration Statement
filed September 30, 1998.

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THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT
SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS
REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH
SECTION 8(A) OF THE SECURITIES ACT OF 1933, AS AMENDED, OR UNTIL THE
REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION,
ACTING PURSUANT TO SAID SECTION 8(A), MAY DETERMINE.

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++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A +
+REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE +
+SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY +
+OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT +
+BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR +
+THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE +
+SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE +
+UNLAWFUL PRIOR TO THE REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS +
+OF ANY SUCH STATE. +
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++

SUBJECT TO COMPLETION DATED NOVEMBER 6, 1998

[TICKETMASTER ONLINE LOGO]

[CITYSEARCH LOGO}

7,000,000 SHARES

TICKETMASTER ONLINE-CITYSEARCH, INC.

CLASS B COMMON STOCK

All of the shares of Class B Common Stock (the "Class B Common Stock")
offered hereby are being offered by Ticketmaster Online-CitySearch, Inc. (the
"Company"). Prior to this offering, there has been no public market for the
Class B Common Stock. It is currently estimated that the initial public
offering price will be between $8.00 and $10.00 per share. See "Underwriting"
for a discussion of factors to be considered in determining the initial public
offering price. Application has been made to have the Class B Common Stock
approved for listing on the Nasdaq National Market under the symbol "TMCS."

(Continued)

THIS OFFERING INVOLVES A HIGH DEGREE OF RISK. SEE "RISK FACTORS" BEGINNING ON
PAGE 12 FOR A DISCUSSION OF CERTAIN FACTORS THAT SHOULD BE CONSIDERED BY
PROSPECTIVE PURCHASERS OF THE CLASS B COMMON STOCK OFFERED HEREBY.

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THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

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Price Proceeds
to Underwriting to
Public Discount(1) Company(2)
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Per Share........................................ $ $ $
Total(3)......................................... $ $ $
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(1) See "Underwriting" for information concerning indemnification of the
Underwriters and other matters.

(2) Before deducting offering expenses estimated at $ . The Underwriters
have agreed to reimburse the Company under certain circumstances for a
portion of such expenses. See "Underwriting."

(3) The Company has granted to the Underwriters a 30-day option to purchase up
to an additional 1,050,000 shares of Class B Common Stock solely to cover
over-allotments, if any. If the Underwriters exercise this option in full,
the Price to Public will total $ , the Underwriting Discount will total
$ and the Proceeds to Company will total $ . See "Underwriting."

The shares of Class B Common Stock are offered by the Underwriters named
herein, subject to receipt and acceptance by them, and subject to their right
to reject any order in whole or in part. It is expected that delivery of the
certificates representing the shares will be made against payment therefor at
the office of NationsBanc Montgomery Securities LLC on or about , 1998.

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NationsBanc Montgomery Securities LLC
Allen & Company Incorporated
BancBoston Robertson Stephens
Bear, Stearns & Co. Inc.
Donaldson, Lufkin & Jenrette

, 1998
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[This page will contain a short paragraph of text briefly describing the Web
services operated by Ticketmaster Online-CitySearch. Immediately below this
paragraph will be screen shots of the home pages of each of the CitySearch and
Ticketmaster Online Web sites. Below the home page screen shots are maps of the
United States and certain foreign countries on which the cities where
CitySearch provides local guides are indicated by the CitySearch logo, and the
areas with live event venues ticketed by Ticketmaster Online are indicated by
the Ticketmaster Online logo.]

CERTAIN PERSONS PARTICIPATING IN THE OFFERING MAY ENGAGE IN TRANSACTIONS THAT
STABILIZE, MAINTAIN OR OTHERWISE AFFECT THE PRICE OF THE CLASS B COMMON STOCK
OFFERED HEREBY. SUCH TRANSACTIONS MAY INCLUDE STABILIZING THE PRICE OF THE
CLASS B COMMON STOCK TO COVER SYNDICATE SHORT POSITIONS AND THE IMPOSITION OF
PENALTY BIDS. FOR A DESCRIPTION OF THESE ACTIVITIES, SEE "UNDERWRITING."

The CitySearch logo is a registered United States trademark of the Company.
"CitySearch" is a United States trademark of a third party, and the Company is
the exclusive third-party licensee of this trademark in its field of use.
"Ticketmaster" is a registered United States trademark of Ticketmaster Corp.
The Ticketmaster Online logo is a registered United States service mark of
Ticketmaster Corp. This Prospectus also contains trademarks and tradenames of
other companies.

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[This page will contain five citysearch.com screen shots. There will be a
short description of the contents of these pages immediately adjacent to them.
The upper left hand screen shot will depict a home page from one of
CitySearch's city guides and the upper right hand screen shot will depict an
"Arts and Entertainment" topic page indicating a search for "Rock Music"
events in the search box. The third screen shot, located in roughly the center
of the page, will depict a listing of events resulting from the search for
"Rock Music" events. To the right of, and slightly below, this screen shot
will be a screen shot of an event profile created by CitySearch describing one
of the listed "Rock Music" events. Below the screen shot of the event profile
will be a screen shot of a custom Web site purchased by a CitySearch business
customer that hosts Rock Music events. This screen shot also depicts a feature
that enables Web users to get more information on places to go and things to
do nearby the business customer's location.]
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[This page will contain five ticketmaster.com screen shots. The upper left
corner of the page will contain a screen shot of the Ticketmaster Online home
page. There will be a short description of the contents of these pages
adjacent to them. Immediately to the right of this screen shot will be a
screen shot of the Ticketmaster Online event guide, which offers searching and
browsing of events and venues. The third screen shot, located in roughly the
center of the page, will be a ticket summary page for a Rock Music event
showing the venue, date, time and pricing information. Below the ticket
summary page will be a screen shot of a ticket order form for ordering tickets
online. To the left of this screen shot will be a screen shot of a seating
chart, which allows consumers to view the venue and seat selection.]
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(Continued from cover page)

Following this offering, the Company will have two classes of authorized
Common Stock (as defined below) outstanding, Class A Common Stock (the "Class
A Common Stock"), and the Class B Common Stock offered hereby. As of the date
of this Prospectus, there were 62,539,744 shares of Class A Common Stock and
no shares of Class B Common Stock outstanding. The rights of the holders of
Class A Common Stock and Class B Common Stock are substantially identical,
except with respect to voting, conversion and transfer. Except as otherwise
required by applicable law, each share of Class A Common Stock entitles its
holder to 15 votes and each share of Class B Common Stock entitles its holder
to one vote on all matters submitted to a vote or for the consent of
stockholders. Except as otherwise required by applicable law, the Class A
Common Stock and the Class B Common Stock shall vote together as a single
class on all matters submitted to a vote or for the consent of stockholders.
The Company has also authorized Class C Common Stock (the "Class C Common
Stock" and, together with the Class A Common Stock and the Class B Common
Stock, the "Common Stock"), which is nonvoting and of which no shares are
issued and outstanding. See "Description of Capital Stock." The Company is
currently a direct, non-wholly-owned subsidiary of Ticketmaster Corporation,
an Illinois corporation ("Ticketmaster Corp."), which is an indirect wholly-
owned subsidiary of USA Networks, Inc., a Delaware corporation ("USAi"). USAi
beneficially owns 42,480,143 shares of Class A Common Stock, or approximately
67.9%, of the Company's outstanding Common Stock prior to this offering.
Immediately after this offering, USAi will beneficially own approximately
61.1% of the outstanding Common Stock, representing approximately 67.4% of the
total voting power of the outstanding Common Stock. As a result of such
ownership, after giving effect to this offering, USAi will be able to control
the outcome of substantially all matters submitted to a vote or for the
consent of stockholders, including the election of directors and the approval
of other corporate transactions. See "Risk Factors--Control by and
Relationship with USAi," "--Potential Conflicts of Interest," "--Possible
Future Sales of Common Stock by USAi," "Principal Stockholders" and
"Ticketmaster Online-CitySearch Merger."
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PROSPECTUS SUMMARY

The following summary should be read in conjunction with, and is qualified in
its entirety by, the more detailed information, including "Risk Factors," the
Consolidated Financial Statements of CitySearch, Inc. and Notes thereto, the
Financial Statements of Ticketmaster Multimedia Holdings, Inc. (the "Financial
Statements of Ticketmaster Online") and Notes thereto, which present the
historical financial statements of Ticketmaster Multimedia Holdings, Inc. prior
to the Merger (as defined below), and the consolidated financial statements of
Ticketmaster Online and CitySearch, Inc. subsequent to the Merger, and the
Unaudited Pro Forma Condensed Combined Financial Statements and Notes thereto,
appearing elsewhere in this Prospectus. The discussion in this Prospectus
includes forward-looking statements that involve risks and uncertainties. The
Company's actual results may differ materially from those discussed in such
forward-looking statements. Unless the context otherwise requires,
(i) "Ticketmaster Online" means, prior to the Merger, Ticketmaster Multimedia
Holdings, Inc. and, after the Merger, the Ticketmaster Online business of the
Company, (ii) "CitySearch" means, prior to the Merger, CitySearch, Inc. and its
subsidiaries and, after the Merger, the CitySearch business of the Company,
(iii) "Ticketmaster Group" means Ticketmaster Group, Inc., a wholly-owned
subsidiary of USA Networks, Inc., and its subsidiaries and managed affiliates
(other than Ticketmaster Online and the Company), (iv) "Ticketmaster Corp."
means Ticketmaster Corporation, a wholly-owned subsidiary of Ticketmaster
Group, and its subsidiaries and managed affiliates (other than Ticketmaster
Online and the Company) collectively or individually, and (v) "USAi" means USA
Networks, Inc. and its subsidiaries and managed affiliates (other than
Ticketmaster Online and the Company). All information in this Prospectus (i)
reflects the merger of Ticketmaster Online with a wholly-owned subsidiary of
CitySearch, which became effective on September 28, 1998, with Ticketmaster
Online continuing as the surviving corporation and as a wholly-owned subsidiary
of CitySearch (the "Merger"), (ii) reflects the conversion of all of the
outstanding Series A, Series B, Series C, Series D and Series E convertible
preferred stock, each with a par value $.01 per share, of CitySearch
(collectively, the "CitySearch Convertible Preferred Stock") into common stock,
par value $.01 per share of CitySearch (the "CitySearch Common Stock") which
became effective immediately prior to consummation of the Merger (the
"Conversion") and the reclassification of all outstanding shares of the
CitySearch Common Stock into Class A Common Stock, which became effective on
September 28, 1998 (the "Reclassification"), and (iii) assumes no exercise of
the Underwriters' over-allotment option.

THE COMPANY

The Company is combining CitySearch and Ticketmaster Online to create a
leading provider of local city guides, local advertising and live event
ticketing on the Internet. The Company intends to integrate its local
CitySearch city guides with its Ticketmaster Online live events ticketing and
merchandise distribution capabilities to offer online ticketing, merchandise,
electronic coupons and other transactions to a broader audience of consumers.
The CitySearch city guides provide up-to-date information regarding arts and
entertainment events, community activities, recreation, business, shopping,
professional services and news/sports/weather to consumers in metropolitan
areas. Ticketmaster Online offers consumers up-to-date information on live
entertainment events and a convenient means of purchasing tickets for live
events and related merchandise on the World Wide Web (the "Web") in 44 states
and Canada and the United Kingdom. Consumers can access the Ticketmaster Online
service at www.ticketmaster.com and from CitySearch owned and operated city
guides at www.citysearch.com through numerous direct links from banners and
event profiles. Subject to certain limitations, Ticketmaster Online is the
exclusive agent for Ticketmaster Corp., a leading provider of live event
automated ticketing services in the United States, for the online sale of
tickets to live events presented by Ticketmaster Corp.'s clients. The Company
intends to do business under the name "CitySearch."

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Company plans to provide multiple links between its services, thereby providing
additional information to assist purchasing decisions. The Company believes
that by expanding its branded network of local city guides and continuing to
offer attractive features and services, such as live event ticketing, the
Company's Web sites will increasingly attract local, regional and national
advertisers that seek to efficiently target local consumers.

The CitySearch Service

Each local city guide primarily consists of original content developed and
designed specifically for the Web by the Company and its partners. The
CitySearch service is topically organized by categories, such as arts and
entertainment, restaurants and bars, community, shops and services, sports and
outdoors, hotels and tourism, local news and professional services. Within most
of the city guides, consumers can search neighborhood shopping areas, obtain
maps, contact community organizations and vendors by e-mail, and engage in
bulletin board discussions with individuals such as local public officials and
celebrities. In CitySearch owned and operated markets, consumers can also
access the Ticketmaster Online Web site through CitySearch city guides to
purchase live event tickets and related merchandise online.

The Company designs and produces custom-built Web sites and performs related
services for local and regional businesses, aggregates them in a local city
guide environment and provides these businesses with the ability to regularly
update and expand their sites. The CitySearch sites offer local and regional
businesses the opportunity to reach and interact with targeted consumers. The
Company builds its city guides with the involvement of local government,
community and volunteer associations, business and professional groups,
educational institutions and local media companies. In addition, content
generated by consumers through e-mail and bulletin boards, available in most
sites, enhances the sense of community in CitySearch sites.

The Company and its partners create original and locally focused content that
can be accessed using targeted, sophisticated searches across all content
residing on a CitySearch site. In contrast, many search engines and
navigational guides access pre-existing content from third-party Web sites that
may be incomplete or out of date. In its owned and operated markets, the
Company offers a broad array of updated, local content that is relevant to
consumers. In certain other markets, the Company provides local media companies
with the necessary technology and business expertise to design, launch and
operate a co-branded CitySearch site.

The Company launched its initial site in the Raleigh-Durham-Chapel Hill
metropolitan area in May 1996. The Company and its partners have since launched
or initiated a roll out of Web-based local city guides in Austin, Baltimore,
Dallas, Los Angeles, Nashville, New York City, Portland, Salt Lake City/Utah,
San Diego, the San Francisco Bay Area and Washington, D.C. in the United States
and in Copenhagen, Melbourne, Stockholm, Sydney and Toronto internationally. As
of September 30, 1998, approximately 8,500 CitySearch business Web sites were
online in the Company's owned and operated markets, while the Company believes
that approximately 8,400 business Web sites were online and operated by the
Company's local media partners ("partner-led markets").

The Company intends to enter targeted geographic regions, including those in
which Ticketmaster Corp. clients are located, through either an owned and
operated presence or by entering into partnerships and strategic alliances with
major media and telephony companies. The Company has, for instance, partnered
with The Baltimore Sun, The Dallas Morning News, the Los Angeles Times, The San
Diego Union-Tribune, Washingtonpost.Newsweek Interactive, Big Colour Pages
(independent yellow pages of Australia), The Melbourne Age, Schibsted
ASA/Scandinavia Online (Copenhagen, Oslo and Stockholm), The Sydney Morning
Herald, Tele-Direct (the yellow pages subsidiary of Bell Canada, Inc.) and the
Toronto Star. These major media partners bring capital, brand recognition,
promotional strength and local knowledge to their CitySearch sites and allow
the Company to build out its national and international network of sites faster
than it could solely through owned and operated sites.

The Company has also entered into an agreement with Classified Ventures,
L.L.C. ("Classified Ventures"), a leading provider of online classified
advertising products and services to the newspaper industry that was

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formed by eight leading newspaper companies. The Company has licensed elements
of its technology and business systems to Classified Ventures and provides
services in automotive and real estate classified advertising categories. The
Company has also entered into an agreement with American Express Travel Related
Services Company, Inc. ("American Express") that provides for marketing of
CitySearch's services to American Express merchant customers and various other
electronic commerce ("e-commerce") and marketing initiatives.

The Ticketmaster Online Service

Ticketmaster Online is a leading online ticketing service that enables
consumers to purchase tickets for live music, sports, theater and family
entertainment events presented by Ticketmaster Corp.'s clients and related
merchandise over the Web. The Company believes the online nature of the service
offers improved marketing and distribution capabilities as well as a larger
potential consumer base to Ticketmaster Corp. clients, while providing
consumers more convenient access to live event tickets and related merchandise.
In addition to these services, the Ticketmaster Online Web site provides local
information and original content regarding live events for Ticketmaster Corp.
clients throughout the United States, Canada and the United Kingdom.

Since its commencement of online ticket sales in November 1996, Ticketmaster
Online has experienced significant growth in tickets sold through its Web site.
Gross transaction dollars from ticket sales increased from approximately
$270,000 in November 1996 to approximately $11.6 million in September 1998.
Similarly, tickets sold on the Ticketmaster Online Web site in November 1996
represented less than 0.1% of total tickets sold by Ticketmaster Corp., while
tickets sold online in the month of September 1998 represented approximately
5.3%.

The Ticketmaster Online Web site consists primarily of original content
developed and designed specifically for the Web by Ticketmaster Online.
Information is currently available through a database with information on more
than 3,000 clients, and weekly listings of live events. Scheduled to launch in
the fourth quarter of 1998, the "my Ticketmaster" Web site is being developed
in partnership with Intel Corporation and will permit consumers to order
tickets and related merchandise over the Web while customizing live event
information to individual preferences.

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The Company is a direct, non-wholly-owned subsidiary of Ticketmaster Corp.,
which is an indirect wholly-owned subsidiary of USAi. USAi acquired a
controlling interest in Ticketmaster Group in July 1997 and the remainder of
the outstanding equity in Ticketmaster Group in June 1998, at which time
Ticketmaster Group became a wholly-owned subsidiary of USAi (the "Ticketmaster
Transaction"). The Company's other equity investors include entities affiliated
with The Goldman Sachs Group, L.P., Washingtonpost.Newsweek Interactive, The
Times Mirror Company, CPQ Holdings, Inc. (an entity affiliated with Compaq
Computer Corporation), Global Retail Partners, L.P., American Express, Intel
Corporation, AT&T Ventures, T. Rowe Price Threshold Fund III, L.P. and
Schibsted ASA.

The Company's principal executive offices are located at 790 E. Colorado
Boulevard, Suite 200, Pasadena, California 91101, and its telephone number at
that address is (626) 405-0050.

TICKETMASTER ONLINE-CITYSEARCH MERGER

On September 28, 1998, pursuant to an Amended and Restated Agreement and Plan
of Reorganization, dated August 12, 1998 (the "Merger Agreement"), by and among
CitySearch, USAi, Ticketmaster Group, Ticketmaster Corp., Ticketmaster Online,
and Tiberius, Inc., a wholly-owned subsidiary of CitySearch ("Merger Sub"),
Merger Sub was merged with and into Ticketmaster Online, with Ticketmaster
Online continuing as the surviving corporation and as a wholly-owned subsidiary
of the Company. Immediately prior to the Merger, all of the outstanding shares
of CitySearch Convertible Preferred Stock were converted into shares of
CitySearch Common Stock, and all outstanding options and warrants to purchase
shares of CitySearch Convertible Preferred Stock were converted into options or
warrants to purchase shares of CitySearch Common Stock. At the effective time
of the Merger, the outstanding capital stock of Ticketmaster Online was
converted into an aggregate of 37,238,000 shares of CitySearch Common Stock
which pursuant to the Reclassification was subsequently converted into Class A
Common Stock of the Company. In addition, all outstanding warrants and options

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exercisable for shares of CitySearch Common Stock became exercisable for shares
of Class A Common Stock (according to their existing vesting schedules and
other terms).

Pursuant to the terms of the Merger Agreement, on October 2, 1998, USAi
commenced an offer (the "Tender Offer") to purchase from holders of Common
Stock (including holders of outstanding options or warrants to acquire Common
Stock that were vested and exercisable at the effective time of the Merger) and
transferees of all such holders (excluding USAi and its affiliates) (each a
"Current CitySearch Holder") up to 20% of each such holder's shares of Common
Stock (including shares of Common Stock issuable upon exercise of options or
warrants that were vested and exercisable at the effective time of the Merger)
at a per share price of $8.67 net to the seller in cash. USAi purchased
1,997,502 shares of Class A Common Stock pursuant to the Tender Offer, which
was completed on November 3, 1998. See "Ticketmaster Online-CitySearch Merger--
Merger Agreement."

Following the Merger and the Tender Offer, USAi beneficially owns 42,480,143
shares of Class A Common Stock, or approximately 67.9% of the outstanding
Common Stock. As a result of such ownership, after giving effect to this
offering, USAi will be able to control the outcome of substantially all matters
submitted to a vote of or for the consent of stockholders, including the
election of directors and the approval of other corporate transactions. See
"Risk Factors--Control by and Relationship with USAi," "--Potential Conflicts
of Interest," "--Possible Future Sales of Common Stock by USAi," "Principal
Stockholders" and "Ticketmaster Online-CitySearch Merger."

Concurrently with the execution of the Merger Agreement, Ticketmaster Corp.,
Ticketmaster Online and USAi entered into a License and Services Agreement,
dated August 12, 1998 (the "Ticketmaster License Agreement"). The Ticketmaster
License Agreement designates Ticketmaster Online as Ticketmaster Corp.'s
exclusive online sales agent for live event tickets and allows Ticketmaster
Online to use the Ticketmaster trademark in connection with online promotion of
sales of tickets to live events presented by Ticketmaster Corp.'s clients,
subject to certain limitations. For purposes of the Ticketmaster License
Agreement, "online sales" is defined to include sales over the Web and any
sales through commercial online services such as America Online and @Home. The
Ticketmaster License Agreement also grants Ticketmaster Online certain non-
exclusive rights to conduct online solicitation of sales for merchandise
offered by Ticketmaster Corp. The Ticketmaster License Agreement further
provides that Ticketmaster Online may not enter into arrangements with venues,
ticket sellers or sales agents to sell tickets online and that USAi and its
affiliates may not enter into arrangements with other parties for online sales
of tickets to events presented by Ticketmaster Corp.'s clients. See "Risk
Factors--Dependence on Relationship with Ticketmaster Corp." and "Business--
Ticketmaster Online Business--Ticketmaster License Agreement."

In addition, concurrently with the execution of the Merger Agreement, USAi
loaned $50 million in cash to CitySearch in exchange for a convertible note
with a $50 million principal amount (the "Convertible Note"). The Convertible
Note bears interest at a rate of 7.00% per annum and is generally due and
payable on the earlier to occur of (a) August 13, 2005 or (b) 20 days following
the closing of an initial public offering which meets certain criteria. The
Company intends to use up to approximately $51 million of the net proceeds of
this offering to repay in full the Convertible Note and the accrued interest
thereon. See "Use of Proceeds," "Capitalization" and "Ticketmaster Online-
CitySearch Merger."

RISK FACTORS

No assurances can be given that the Company's objectives or strategies will
be achieved. Prospective investors should carefully consider the factors
discussed in detail elsewhere in this Prospectus under "Risk Factors."

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THE OFFERING

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Class B Common Stock offered...... 7,000,000 shares
Common Stock to be outstanding
after this offering:
Class A Common Stock............ 62,486,478 shares(1)
Class B Common Stock............ 7,000,000 shares(1)(2)
Total Common Stock............ 69,486,478 shares(1)(2)
</TABLE>
- --------

(1) Based on shares of Class A Common Stock outstanding as of September 30,
1998. Does not include (i) 3,890,694 shares of Class A Common Stock
issuable upon exercise of options outstanding at September 30, 1998 at a
weighted average exercise price of $3.66 per share under the Company's 1996
Stock Option Plan (the "1996 Stock Plan") and (ii) 93,107 shares of Class A
Common Stock issuable upon exercise of an outstanding warrant at an
exercise price of $8.86 per share held by NationsBanc Montgomery Securities
LLC. See "Capitalization," "Management--Employee Benefit Plans,"
"Underwriting" and Note 7 of Notes to Consolidated Financial Statements of
Ticketmaster Online.

(2) Does not include, as of the date of this Prospectus, an aggregate of
shares of Class B Common Stock available for future grant or issuance under
the Company's 1998 Stock Option Plan (the "1998 Stock Plan") and 1998
Employee Stock Purchase Plan (the "Purchase Plan"). See "Management--
Employee Benefit Plans."

Relative rights of Class A Common
Stock and Class B Common Stock..... The Class A Common Stock and Class B
Common Stock have substantially identical
rights other than with respect to voting,
conversion and transfer. Except as
otherwise required by applicable law, the
Class A Common Stock entitles its holders
to 15 votes per share while the Class B
Common Stock entitles its holders to one
vote per share on all matters submitted
to a vote or for the consent of
stockholders. Except as otherwise
required by applicable law, the Class A
Common Stock and Class B Common Stock
will vote together as a single class on
all matters submitted to a vote or for
the consent of stockholders. The shares
of Class A Common Stock are convertible
at any time at the option of the holder
into shares of Class B Common Stock on a
share-for-share basis. In addition,
shares of Class A Common Stock will
automatically be converted into a like
number of shares of Class B Common Stock
upon any sale, pledge, conveyance,
hypothecation, assignment or other
transfer (a "Transfer") of such shares by
the initial registered holder, except
under certain limited circumstances. See
"Description of Capital Stock."

Controlling stockholder.............
USAi beneficially owns 42,480,143 shares
of Class A Common Stock, or approximately
67.9% of the Company's outstanding Common
Stock and, immediately after this
offering, will beneficially own
approximately 61.1% of the outstanding
Common Stock of the Company, representing
approximately 67.4% of the total voting
power of the Common Stock. See "Risk
Factors--Control by and Relationship with
USAi," "--Potential Conflicts of
Interest," "--Possible Future Sales of
Common Stock by USAi," "Principal
Stockholders" and "Ticketmaster Online-
CitySearch Merger."

7
<PAGE>

Use of proceeds.....................
The Company intends to use up to
approximately $51 million of the net
proceeds of this offering to repay in
full the Convertible Note and the accrued
interest thereon. The Convertible Note
was issued to USAi upon execution of the
Merger Agreement in exchange for a $50
million loan from USAi to provide working
capital to the Company. To the extent
there are net proceeds in excess of
approximately $51 million, such proceeds
are expected to be used for working
capital and other general corporate
purposes.

Proposed Nasdaq symbol.............. TMCS

8
<PAGE>

CITYSEARCH SUMMARY HISTORICAL FINANCIAL DATA
(IN THOUSANDS, EXCEPT PER SHARE DATA)

The CitySearch summary historical financial data set forth below have been
derived from the Consolidated Financial Statements of CitySearch, Inc. and the
Notes thereto set forth elsewhere in this Prospectus and should be read in
conjunction with those financial statements and notes. The data set forth below
do not give effect to the Merger.

<TABLE>
<CAPTION>
SEPTEMBER 28,
1998(1)
-------------
<S> <C>
CONSOLIDATED BALANCE SHEET DATA:
Cash and cash equivalents........................................ $57,877
Working capital.................................................. 50,940
Total assets..................................................... 65,209
Long-term obligations, less current portion...................... 52,320
Stockholders' equity............................................. 3,837
</TABLE>
- --------

(1) The historical financial data of CitySearch is presented through the
effective date of the Merger (September 28, 1998). References throughout
this Prospectus to the nine months ended September 28, 1998 refer to the
period from January 1, 1998 through September 28, 1998.
(2) Shares used to compute pro forma basic and diluted net loss per share give
effect to the conversion of CitySearch Convertible Preferred Stock as if
converted at the earlier of the beginning of the period or issue date. See
Note 1 of Notes to Consolidated Financial Statements of CitySearch, Inc.
for an explanation of the determination of the number of shares used to
compute historical and pro forma basic and diluted net loss per share.

9
<PAGE>

TICKETMASTER ONLINE SUMMARY HISTORICAL FINANCIAL DATA
(IN THOUSANDS, EXCEPT PER SHARE DATA)

The Ticketmaster Online summary historical financial data set forth below
have been derived from the Financial Statements of Ticketmaster Online and the
Notes thereto set forth elsewhere in this Prospectus and should be read in
conjunction with those financial statements and notes. The data set forth below
presents the historical financial information of Ticketmaster Online prior to
the Merger and the consolidated financial information of Ticketmaster Online
and CitySearch for the two-day period ended September 30, 1998 subsequent to
the Merger.

<TABLE>
<CAPTION>
SEPTEMBER 30, PRO FORMA
1998(5) AS ADJUSTED(6)
------------- --------------
<S> <C> <C>
BALANCE SHEET DATA:
Cash and cash equivalents......................... $ 57,877 $64,067
Working capital................................... 49,364 56,024
Total assets(4)................................... 363,757 387,147
Long-term obligations, less current portion....... 52,320 2,320
Stockholders' equity(4)........................... 299,953 374,343
</TABLE>
- --------
(1) Ticketmaster Online did not incur costs or expenses until June 1995 and
commenced selling live event tickets and merchandise online in November
1996.

(2) Includes the operating results of CitySearch from September 29, 1998 to
September 30, 1998 as a result of the Merger.

(3) Basic and diluted net income (loss) per equivalent share is based on the
number of shares of CitySearch Common Stock exchanged in the Merger for all
periods presented, and for the eight months ended September 30, 1998
includes the outstanding Class A Common Stock for two days subsequent to
the Merger in the calculation of average shares.

(4) Total assets and stockholders' equity reflect a preliminary allocation of
$298.3 million of goodwill resulting from the Merger and the Ticketmaster
Transaction, and on a pro forma as adjusted basis, includes additional
goodwill of $17.2 million resulting from the Tender Offer.

(5) The balance sheet data at September 30, 1998 represent the consolidated
assets and liabilities of Ticketmaster Online and CitySearch as a result of
the Merger.

(6) Pro forma as adjusted amounts give effect to the purchase by USAi of
1,997,502 shares of Class A Common Stock from existing stockholders at
$8.67 per share pursuant to the Tender Offer, on a pro forma basis as of
September 30, 1998, and reflects the sale and issuance of the 7,000,000
shares of Class B Common Stock offered hereby at an assumed initial public
offering price of $9.00 per share (after deducting the underwriting
discount and estimated offering expenses payable by the Company) and the
application of the estimated net proceeds from this offering. See "Use of
Proceeds" and "Capitalization."

10
<PAGE>

SUMMARY UNAUDITED PRO FORMA COMBINED FINANCIAL DATA
(IN THOUSANDS, EXCEPT PER SHARE DATA)

The summary unaudited pro forma combined financial data set forth below give
effect to the Merger, the Tender Offer and the Ticketmaster Transaction. The
Merger was accounted for using the "reverse purchase" method of accounting,
pursuant to which Ticketmaster Online was treated as the acquiring entity for
accounting purposes, and the assets and liabilities of CitySearch will be
recorded at their respective fair values. The unaudited pro forma combined
statements of operations data give effect to the Merger, the Tender Offer and
the Ticketmaster Transaction as if they had occurred at the beginning of the
respective periods. The summary unaudited pro forma combined financial data
have been derived from the unaudited pro forma condensed combined financial
statements and notes thereto set forth elsewhere herein and should be read in
conjunction with those financial statements and notes. The summary unaudited
pro forma combined financial data do not purport to be indicative of future
operations and should not be construed as representative of future operations
of the combined companies.

<TABLE>
<CAPTION>
NINE MONTHS
YEAR ENDED ENDED
DECEMBER 31, SEPTEMBER 30,
1997 1998
------------ -------------
(IN THOUSANDS, EXCEPT
PER SHARE DATA)
<S> <C> <C>
PRO FORMA COMBINED STATEMENTS OF OPERATIONS DATA:
Revenues:
Ticketing operations.............................. $ 5,442 $ 10,571
Sponsorship and advertising....................... 3,965 4,915
City guide and related............................ 6,072 11,069
-------- --------
Total revenues.................................. 15,479 26,555
Costs and expenses:
Cost of ticketing operations...................... 3,865 7,810
Cost of city guide and related.................... 9,688 10,588
Sales and marketing............................... 20,611 15,734
Research and development.......................... 7,182 5,038
General and administrative........................ 6,993 5,998
Amortization of goodwill.......................... 57,461 43,096
Merger and other transactions costs............... -- 3,101
-------- --------
Total costs and expenses........................ 105,800 91,365
-------- --------
Loss from operations............................... (90,321) (64,810)
Interest income, net............................... 223 696
-------- --------
Loss before provision for income taxes............. (90,098) (64,114)
Provision for income taxes......................... 8 --
-------- --------
Net loss........................................... $(90,106) $(64,114)
======== ========
Basic and diluted net loss per share............... $ (1.61) $ (1.04)
Shares used to compute basic and diluted net loss
per share......................................... 55,898 61,785
</TABLE>

11
<PAGE>

RISK FACTORS

This offering involves a high degree of risk. In addition to the other
information set forth in this Prospectus, the following risk factors should be
considered carefully in evaluating the Company and its business before
purchasing any of the shares of Class B Common Stock offered hereby. This
Prospectus contains forward-looking statements that involve risks and
uncertainties, which statements may be deemed to include, but are not limited
to, the Company's plans to grow its online businesses, to expand the range of
services offered by the Company, to increase the number of customers and
venues using the Company's services and the dollar volume of transactions
booked through the Company's Web sites, to otherwise expand its business
activities in new cities and foreign countries, to retain key personnel or
otherwise to implement its strategy as well as the Company's beliefs regarding
consumer acceptance of the Internet as a means of commerce and the use of the
Internet as a source of advertising. Such statements include statements
regarding the belief or current expectation of the Company's management and
are necessarily based on management's current understanding of the markets and
industries in which the Company operates. That understanding could change or
could prove to be inconsistent with actual developments. The Company's actual
results could differ materially from the results discussed in this Prospectus,
including those anticipated in or implied by any forward-looking statements.
Factors that could cause or contribute to such differences include those
discussed below, as well as those discussed elsewhere in this Prospectus. The
cautionary statements made in this Prospectus should be read as being
applicable to all forward-looking statements wherever they appear in this
Prospectus.

LIMITED OPERATING HISTORY

CitySearch was incorporated in September 1995 and launched its initial local
city guide service in the Raleigh-Durham-Chapel Hill metropolitan area in May
1996. Ticketmaster Online commenced online ticket sales in November 1996.
Accordingly, the CitySearch and Ticketmaster Online businesses each have an
extremely limited operating history upon which an evaluation of the Company
and its prospects can be based. The Company's prospects must be considered in
light of the risks, expenses and difficulties frequently encountered by
companies in their early stages of development, particularly companies in new
and rapidly evolving markets such as those in which the Company competes. Such
risks include, but are not limited to, evolving and unpredictable business
models, management of growth, the Company's ability to anticipate and adapt to
developing markets, acceptance by Internet users, consumers and business
customers of the Company's services and the ability of the Company to
establish relationships with additional strategic partners. To address these
risks, the Company must, among other things, attract and retain an audience of
frequent users of its services in its target markets, maintain its business
customer base, attract a significant number of new CitySearch business
customers in target markets, expand its sales of tickets and merchandise
through Ticketmaster Online, respond to competitive developments, continue to
form and maintain relationships with media partners, continue to attract,
retain and motivate qualified personnel, provide superior customer service,
and continue to develop and upgrade its technologies and commercialize its
services incorporating such technologies. There can be no assurance that the
Company will be successful in addressing such risks, and a failure to do so
could have a material adverse effect on the Company's business, financial
condition and results of operations.

Furthermore, neither the Company, CitySearch nor Ticketmaster Online has any
history as a company with public reporting obligations, and operating the
Company with such obligations will place substantial demands on management and
the Company's operating systems. These increased demands may require further
expenditures to hire management personnel and to expand the Company's
operating systems. To the extent such expenditures precede or are not
subsequently followed by increased revenues, the Company's business, financial
condition and results of operations could be materially and adversely
affected. See "Management's Discussion and Analysis of Financial Condition and
Results of Operations."

ABSENCE OF HISTORY OF TICKETMASTER ONLINE AS AN INDEPENDENT COMPANY

Prior to the Merger, Ticketmaster Online was operated as a wholly-owned
subsidiary of Ticketmaster Corp. As a result, Ticketmaster Online does not
have an operating history as an independent company. In addition,

12
<PAGE>

prior to the Merger, Ticketmaster Online relied on Ticketmaster Corp. to
provide certain human resource, finance, recruiting, legal and other services.
Neither USAi nor Ticketmaster Corp. is required to provide assistance, funding
or any such services to Ticketmaster Online or the Company, except as
described in the Ticketmaster License Agreement. The Company will be required
to develop and implement the operational, administrative and other systems and
infrastructure necessary to support Ticketmaster Online's current and future
business, and any failure to do so could have a material adverse effect on the
Company's business, financial condition and results of operations. See "--
Dependence on Relationship with Ticketmaster Corp.," "--Control by and
Relationship with USAi" and "--Management of Potential Growth; Risks
Associated with Expansion."

ANTICIPATED CONTINUED OPERATING LOSSES

CitySearch incurred net losses of $308,000, $13.9 million and $36.5 million
for the period from September 20, 1995 (date of formation) to December 31,
1995, and for the years ended December 31, 1996 and 1997, respectively, and
$27.1 million for the nine months ended September 28, 1998. At September 28,
1998, CitySearch had an accumulated deficit of $77.8 million. Ticketmaster
Online incurred net losses of $615,000 for the year ended January 31, 1997 and
generated net income of $2.3 million and $2.5 million for the year ended
January 31, 1998 and the eight months ended September 30, 1998, respectively.
As a result of the Ticketmaster Transaction, the Merger and the Tender Offer,
the Company has recorded a significant amount of goodwill which will adversely
affect the earnings and profitability of the Company for the foreseeable
future. The Company recorded an aggregate of $315.5 million of goodwill and
other intangibles, $154.8 million of which related to the Ticketmaster
Transaction and is to be amortized through 2038, and $160.7 million of which
related directly to the Merger and the Tender Offer and is to be amortized
through 2001. To the extent the amount of such recorded goodwill is increased
or the Company has future losses and is unable to demonstrate its ability to
recover the amount of goodwill recorded during such time periods, the period
of amortization could be shortened, which may further increase annual
amortization charges. In such event, the Company's business, financial
condition and results of operations could be materially and adversely
affected.

The Company believes that its future profitability and success will depend
in large part on, among other things, its ability to generate sufficient
revenues from sales of CitySearch Web sites to businesses and from the
licensing of its technology and business systems to partners setting up
CitySearch services in partner-led markets, the ability of Ticketmaster Corp.
to maintain existing relationships and enter into new relationships with live
event venues, sports franchises, promoters and other clients for which it
sells live event tickets and to obtain or retain for Ticketmaster Online the
right to sell live event tickets and related merchandise online, its ability
to effectively maintain existing relationships with its media partners, its
ability to successfully enter into new strategic relationships for
distribution and increased usage of the Ticketmaster Online and CitySearch
services and its ability to generate sufficient online traffic and sales
volume to achieve profitability of the Ticketmaster Online business.
Accordingly, the Company expects to expend significant financial and
management resources on the roll-out of the CitySearch service in new owned
and operated and partner-led markets, site and content development on its
CitySearch and Ticketmaster Online sites, integration of the CitySearch and
Ticketmaster Online services, strategic relationships, technology and
operating infrastructure. As a result, the Company expects to incur
significant additional losses and continued negative cash flow from operations
for the foreseeable future. There can be no assurance that the Company's
revenues will increase or even continue at their current levels or that the
Company will achieve or maintain profitability or generate cash from
operations in future periods. In view of the rapidly evolving nature of the
Company's business, the limited operating history of both CitySearch and
Ticketmaster Online and the risks associated with integrating these
businesses, the Company believes that period-to-period comparisons of
operating results are not meaningful and should not be relied upon as an
indication of future performance. See "Management's Discussion and Analysis of
Financial Condition and Results of Operations."

DEPENDENCE ON RELATIONSHIP WITH TICKETMASTER CORP.

In connection with the Merger, Ticketmaster Online, Ticketmaster Corp. and
USAi entered into the Ticketmaster License Agreement, which agreement
designates, subject to certain limitations, Ticketmaster Online as
Ticketmaster Corp.'s exclusive agent for online live event ticket sales and as
its non-exclusive agent

13
<PAGE>

for the online sale of merchandise. See "Business--Ticketmaster Online
Business--Ticketmaster License Agreement."

The Company anticipates that, for the foreseeable future, a majority of its
revenues will be derived from the online sale of tickets and merchandise by
Ticketmaster Online. Ticketmaster Online currently derives and, for the
foreseeable future, will continue to derive a substantial portion of its
revenues from per ticket convenience charges and per order handling charges
paid by consumers in connection with online purchases of tickets to live
events presented or promoted by clients of Ticketmaster Corp. Ticketmaster
Online does not have contractual relationships with the entities for which it
sells tickets as Ticketmaster Corp.'s agent and it is restricted pursuant to
the Ticketmaster License Agreement from having such relationships, whether
with current Ticketmaster Corp. clients or its potential clients. Accordingly,
Ticketmaster Online's future revenues and business success are dependent on
Ticketmaster Corp.'s ability to maintain and renew relationships with its
existing clients and to establish relationships with additional clients.

For the year ended January 31, 1998, Ticketmaster Corp. processed ticket
sales for over 3,000 clients. Approximately 20% of Ticketmaster Corp.'s client
contracts are subject to renewal each year. Ticketmaster Online is dependent
upon Ticketmaster Corp.'s ability to enter into and maintain client contracts
on terms that are favorable to Ticketmaster Corp. and Ticketmaster Online.
There can be no assurance that Ticketmaster Corp. will be able to enter into
or maintain client contracts on such terms.

All of Ticketmaster Online's ticket sales are processed through Ticketmaster
Corp.'s systems. Under the Ticketmaster License Agreement, Ticketmaster Corp.
is generally obligated to provide order fulfillment services at least at the
same level as such services were generally provided as of the date of the
Ticketmaster License Agreement. The Ticketmaster License Agreement obligates
Ticketmaster Corp. to process a specified number of tickets sold online each
year through December 31, 2001. As a result, Ticketmaster Online's future
revenues are dependent upon Ticketmaster Corp.'s ability to process such
online ticket sales in an accurate and timely manner. While the Company
believes that, due to the perpetual right of Ticketmaster Online to serve as
Ticketmaster Corp.'s exclusive agent for online live event ticket sales,
Ticketmaster Corp. has a substantial interest in its relationship with
Ticketmaster Online, there can be no assurance that Ticketmaster Corp. will
provide fulfillment services to Ticketmaster Online in excess of the
requirements of the Ticketmaster License Agreement and, in particular, after
December 31, 2001.

Ticketmaster Online's ability to generate ticket and merchandise sales on
its Web sites is also dependent in part on Ticketmaster Corp.'s ability to
maintain and enhance the Ticketmaster brand name. Any failure on the part of
Ticketmaster Corp. to maintain its existing base of clients, to establish
relationships with new clients upon terms favorable to Ticketmaster Online, to
obtain or retain for Ticketmaster Online the right to sell tickets and
merchandise online for Ticketmaster Corp.'s clients, to process Ticketmaster
Online's online ticket sales in a timely and accurate manner or at levels
necessary to support Ticketmaster Online's business or to maintain and enhance
the Ticketmaster brand name would have a material adverse effect on the
Company's business, financial condition and results of operations. See
"Management's Discussion and Analysis of Financial Condition and Results of
Operations" and "Ticketmaster Online-CitySearch Merger."

CONTROL BY AND RELATIONSHIP WITH USAI

The Company is currently a direct, non-wholly owned subsidiary of
Ticketmaster Corp., which is an indirect wholly-owned subsidiary of USAi. Upon
completion of this offering, USAi will own approximately 61.1% of the total
outstanding Common Stock, representing approximately 67.4% of the total voting
power of the Common Stock. Following this offering, as a result of its
ownership of Class A Common Stock, USAi will have the right to control the
outcome of any matter submitted for the vote or consent of Company
stockholders, except where a separate vote of the holders of Class B Common
Stock is required by Delaware law. Subject to applicable Delaware law, USAi
will generally not be restricted with regard to its ability to control the
election of directors of the Company, to cause the amendment of the Company's
Amended and Restated Certificate of Incorporation, which will be in effect
immediately prior to the consummation of this offering (the "Restated

14
<PAGE>

Certificate of Incorporation"), Amended and Restated Bylaws, which will be in
effect immediately prior to the consummation of this offering (the "Restated
Bylaws") and other documents (including the Ticketmaster License Agreement) or
generally to exercise a controlling influence over the business and affairs of
the Company, including any determinations with respect to mergers or other
business combinations involving the Company, the acquisition or disposition of
assets by the Company, future issuances of equity securities by the Company,
the incurrence of indebtedness by the Company and the payment of dividends
with respect to the Common Stock. Similarly, USAi will have the power to
prevent, delay or cause a change in control of the Company and could take
other actions that might be favorable to USAi but not necessarily favorable to
other stockholders of the Company. In addition, because of the importance to
the Company of the relationship between Ticketmaster Online and Ticketmaster
Corp., an indirect wholly-owned subsidiary of USAi, the Company is to a large
degree dependent on its business relationships with its controlling
stockholder. There can be no assurance that conflicts, disagreements or other
disputes between the Company and USAi will not arise, or that such disputes
will be resolved in a manner that does not adversely affect the business,
financial condition or results of operations of the Company. There can be no
assurance that USAi's ownership of the Company's Class A Common Stock or its
other relationships with the Company will not have a material adverse effect
on the Company's business, financial condition or results of operations, on
its other stockholders or on the market price of the Company's Class B Common
Stock.

Subject to applicable Delaware law, USAi could elect to sell all or a
substantial portion of its equity interest in the Company to a third party,
which would represent a controlling or substantial interest in the Company,
without offering to other stockholders of the Company the opportunity to
participate in such a transaction. Although there can be no assurance in this
regard, USAi has advised the Company that its current intent is to continue to
hold for the foreseeable future the shares of Class A Common Stock owned by
it. In the event of a sale of USAi's interest to a third party, such third
party may be able to control the Company in the manner that USAi is able to
control the Company, including with respect to the election of a majority of
the members of the Company's Board of Directors. Such a sale may adversely
affect the market price of the Class B Common Stock and may adversely affect
the Company's business, financial condition and results of operations. See "--
Possible Future Sales of Common Stock by USAi."

Barry Diller, who is a director of the Company, is also the Chairman and
Chief Executive Officer of USAi. In addition, pursuant to stockholder and
governance agreements among Mr. Diller, Liberty Media Corp. ("Liberty,") a
subsidiary of Tele-Communications, Inc. ("TCI"), The Seagram Company Ltd.
("Seagram"), Universal Studios, Inc. ("Universal," a subsidiary of Seagram)
and USAi, Mr. Diller generally has the right to control the outcome of any
matter submitted to a vote or for the consent of USAi stockholders, other than
with respect to certain fundamental changes relating to USAi, in which case
the consent of Mr. Diller, Liberty and Universal is generally required for any
such fundamental change. Upon Mr. Diller's departure from USAi, USAi may
change in various fundamental ways, including the possible exercise of control
by Universal over the management and governance of USAi, subject to certain
rights of Liberty. Copies of such governance and stockholders agreements have
been filed with the Securities and Exchange Commission (the "Commission") as
Appendix B and C, respectively, to USAi's Definitive Proxy Statement, dated
January 12, 1998 and are available from the Commission. See "Available
Information." Although Mr. Diller has a significant equity interest in USAi,
including in the form of options to acquire shares of the common stock, par
value $.01 per share, of USAi (the "USAi Common Stock"), some of which are not
fully vested and require Mr. Diller's continued employment for a specified
period to so vest, Mr. Diller does not have an employment or noncompetition
agreement with USAi and is not obligated to remain as an executive officer or
director of that company. Any change in the management, operations or business
of USAi could have a material adverse effect on the Company's relationship
with USAi and Ticketmaster Corp. and could materially and adversely affect the
Company's business, financial condition and results of operations.

POTENTIAL CONFLICTS OF INTEREST

Conflicts of interest may arise between the Company, including Ticketmaster
Online, on the one hand, and USAi and its affiliates, including Ticketmaster
Corp., on the other hand, in areas relating to past, ongoing and

15
<PAGE>

future relationships, including the Ticketmaster License Agreement, corporate
opportunities, indemnity arrangements, tax and intellectual property matters,
potential acquisitions or financing transactions, sales or other dispositions
by USAi of shares of the Company's Class A Common Stock held by it and the
exercise by USAi of its ability to control the management and affairs of the
Company. These conflicts also may include disagreements regarding the
Ticketmaster License Agreement, including with respect to possible amendments
to, or modifications or waivers of provisions of, such agreement. Due to
USAi's ability to control the Company's Board of Directors and subject to
Delaware law, USAi may be able to effect such amendments without seeking the
approval of any other party. Such amendments, modifications or waivers may
adversely affect the Company's business, financial condition and results of
operations. Ownership interests of directors or officers of the Company in the
USAi Common Stock, or service as both a director or officer of the Company and
a director, officer or employee of USAi, could create or appear to create
potential conflicts of interest when directors and officers are faced with
decisions that could have different implications for the Company and USAi.
Seven of the members of the Company's Board of Directors are also directors,
officers or employees of USAi. See "Management" and "Ticketmaster Online--
CitySearch Merger."

In addition, USAi is engaged in a diverse range of media and entertainment-
related businesses, including businesses engaged in electronic and online
commerce (including Home Shopping Network and its USA Interactive business),
and these businesses may have interests that conflict or compete in some
manner with the businesses of the Company. Subject to applicable Delaware law,
USAi is under no obligation, and has not indicated any intention, to share any
future business opportunities available to it with the Company, except as
expressly provided by the Ticketmaster License Agreement. The Company's
Restated Certificate of Incorporation will also include provisions which
provide that (i) USAi shall have no duty to refrain from engaging in the same
or similar activities or lines of business of the Company, thereby competing
with the Company, (ii) USAi, its officers, directors and employees shall not
be liable to the Company or its stockholders for breach of any fiduciary duty
by reason of any activities of USAi in competition with the Company, and (iii)
USAi shall have no duty to communicate or offer corporate opportunities to the
Company and shall not be liable for breach of any fiduciary duty as a
stockholder of the Company in connection with such opportunities, provided
that certain procedures set forth in the Restated Certificate of Incorporation
are followed. There can be no assurance that any conflicts that may arise
between the Company and USAi, any loss of a corporate opportunity to USAi that
might otherwise be available to the Company or any engagement by USAi (subject
to the limitations of the Ticketmaster License Agreement) in any activity that
is similar to the businesses of the Company will not have a material adverse
effect on the Company's business, financial condition and results of
operations or its other stockholders. See "Description of Capital Stock."

POSSIBLE FUTURE SALES OF COMMON STOCK BY USAI

Subject to applicable federal securities laws and the restrictions set forth
below, after completion of this offering, USAi may sell a significant portion
of the shares of the Company's Class A Common Stock beneficially owned by it
(which, after completion of this offering, would represent approximately 61.1%
of the outstanding Common Stock) or distribute any or all of such shares of
Class A Common Stock to its stockholders. Pursuant to the Company's Restated
Certificate of Incorporation, each share of Class A Common Stock will be
converted automatically into one share of Class B Common Stock upon any
Transfer by the initial registered holder thereof (except in certain cases
such as transfers to affiliates or other holders of Class A Common Stock). See
"Description of Capital Stock." Any sales or distribution by USAi of
substantial amounts of Class B Common Stock issuable upon conversion of the
Class A Common Stock held by USAi in the public market or to its stockholders,
or a transfer of beneficial ownership of shares of Class A Common Stock that
does not constitute a Transfer pursuant to the Restated Certificate of
Incorporation, or the perception that such transfers, sales or distribution
could occur, could adversely affect the prevailing market prices for the Class
B Common Stock. USAi is not subject to any obligation to retain any portion of
its controlling interest in the Company, except that USAi has agreed not to
sell or otherwise dispose of any shares of its capital stock of the Company
for a period of 180 days after the date of this Prospectus without the prior
written consent of NationsBanc Montgomery

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<PAGE>

Securities LLC. See "Underwriting." Although there can be no assurance in this
regard, USAi has advised the Company that its current intent is to continue to
hold for the foreseeable future the shares of Class A Common Stock owned by
it. As a result, there can be no assurance concerning the period of time
during which USAi will maintain its beneficial ownership of capital stock of
the Company owned by it following this offering. Moreover, there can be no
assurance that, in any transfer by USAi of a controlling interest in the
Company, any other holders of Common Stock will be able to participate in such
transaction or will realize any premium or other amounts with respect to any
of their shares of such Common Stock.

COMPANY INTEGRATION RISKS

Prior to the Merger, CitySearch operated independently and Ticketmaster
Online operated as a wholly-owned subsidiary of Ticketmaster Corp. and USAi.
The Company's future success will depend to a significant extent on the
efficient, effective and timely integration of CitySearch's operations with
Ticketmaster Online's operations. Such integration will include the
combination of different business models, different technologies and personnel
with different expertise and backgrounds and the development of services in
which CitySearch's local content and Ticketmaster Online's live event-specific
content and transactional capabilities are integrated with each other. The
Company also will be required to evaluate its existing technologies and its
ability to support the expanded range of products and services the Company is
expected to offer. As a result of the Merger, the Company may attempt to link
the Ticketmaster Online ticketing service more closely with certain of its
CitySearch city guides. The Company has not executed such integration in the
past, and such integration could require adaptation of existing technologies
or development of new technologies. There can be no assurance that CitySearch
or Ticketmaster Online will be able to coordinate either operational or
technological integration effectively or efficiently with each other. Failure
to effectively accomplish the integration of the two companies' operations or
the loss of any of CitySearch's or Ticketmaster Online's key employees could
have a material adverse effect on the Company's business, financial condition
and results of operations.

DEPENDENCE ON INCREASED TICKET SALES

The Company's future success, and in particular its revenues and operating
results, depends in large part upon its ability to increase the dollar volume
of transactions through Ticketmaster Online, either by generating
significantly higher levels of traffic to its CitySearch and Ticketmaster
Online Web sites or by increasing the percentage of visitors to its online
sites who purchase tickets or merchandise, or through some combination
thereof. The Company's ability to increase ticket sales will also depend in
part upon Ticketmaster Corp.'s ability to obtain the rights to sell tickets
online for new Ticketmaster Corp. clients. The Company must also increase the
number of repeat purchasers of tickets and merchandise through Ticketmaster
Online. Under the Ticketmaster License Agreement, Ticketmaster Corp. is
generally obligated to provide order fulfillment services at least at the same
level as such services were generally provided as of the date of such
agreement. The Ticketmaster License Agreement obligates Ticketmaster Corp. to
process a specified number of tickets sold online each year through 2001.
While the Company believes that, due to the perpetual right of Ticketmaster
Online to serve as Ticketmaster Corp.'s exclusive agent for online live event
ticket sales, Ticketmaster Corp. has a substantial interest in its
relationship with Ticketmaster Online, there can be no assurance that
Ticketmaster Corp. will provide fulfillment services to Ticketmaster Online in
excess of the requirements of the Ticketmaster License Agreement and, in
particular, after December 31, 2001. In addition, in order to generate
sufficient revenues from sponsorship and advertising on the Ticketmaster
Online Web sites, the Company must deliver a high level of service and
compelling content in order to attract users with demographic characteristics
valuable to sponsors and advertisers. There can be no assurance that the
Company will be able to increase the dollar volume of transactions booked
through its online sites, increase traffic to its online sites, increase the
percentage of visitors who purchase tickets or merchandise, increase the
number of repeat purchasers or increase its sponsorship and advertising
revenues. In addition, there can be no assurance that the Company will be able
to offer its online ticketing services through its city guides in its partner-
led markets on terms acceptable to the Company. The failure to do one or more
of the foregoing would likely have a material adverse effect on the Company's
business, financial condition and results of operations. See "--Dependence on
Relationship with Ticketmaster Corp." and "Management's Discussion and
Analysis of Financial Condition and Results of Operations."

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<PAGE>

FUTURE CAPITAL NEEDS; UNCERTAINTY OF ADDITIONAL FINANCING

Since inception, CitySearch has experienced negative cash flow from
operations and the Company expects to continue to experience significant
negative cash flow from operations for the foreseeable future. USAi has no
obligation or agreement to provide any future capital or other funding to the
Company. The Company currently believes that its existing capital resources,
including the proceeds from the Convertible Note, combined with the net
proceeds of this offering, after repayment in full of the Convertible Note and
any accrued interest thereon, will be sufficient to meet its presently
anticipated cash requirements through at least the next 12 months. Thereafter,
the Company may be required to raise additional funds. No assurance can be
given that the Company will not be required to raise additional financing
prior to such time. If additional funds are raised through the issuance of
equity securities, stockholders of the Company may experience significant
dilution. Furthermore, there can be no assurance that additional financing
will be available when needed or that if available, such financing will
include terms favorable to the Company or its stockholders. If such financing
is not available when required or is not available on acceptable terms, the
Company may be unable to develop or enhance its services, take advantage of
business opportunities or respond to competitive pressures, any of which could
have a material adverse effect on the Company's business, financial condition
and results of operations. See "Management's Discussion and Analysis of
Financial Condition and Results of Operations--Liquidity and Capital
Resources."

UNPREDICTABILITY OF FUTURE REVENUES; FLUCTUATIONS IN OPERATING RESULTS

As a result of CitySearch's limited operating history and Ticketmaster
Online's lack of independent operating history, and the emerging nature of the
markets in which the Company competes, the Company is unable to accurately
forecast its future revenues. The Company's current and future expense levels
are based predominantly on its operating plans and estimates of future
revenues and are to a large extent fixed. For example, the CitySearch business
model, particularly in its owned and operated markets, requires significant
staffing to develop content and to create and maintain relationships with
small- and medium-size businesses. The Company may be unable to adjust
spending in a timely manner to compensate for any unexpected revenue
shortfall. Accordingly, any significant shortfall in revenues would likely
have an immediate material adverse effect on the Company's business, financial
condition and results of operations. Furthermore, the Company currently
intends to increase its operating expenses to roll out its CitySearch service
in new markets, to fund increased sales and marketing and customer service
operations, to attempt to further develop its technology infrastructure and to
integrate its local content with the event-specific content and transactional
capabilities of Ticketmaster Online. To the extent such expenses precede or
are not subsequently followed by increased revenues, the Company's operating
results will fluctuate and net anticipated losses in a given quarter may be
greater than expected.

The Company expects to experience significant fluctuations in its future
operating results due to a variety of factors, many of which are outside of
the Company's control. Factors that may adversely affect the Company's
operating results include, but are not limited to, Ticketmaster Corp.'s
ability to maintain and increase the number of clients for which it provides
online ticketing services and convenience charges relating thereto, the
ability of the Company's partners to meet roll-out schedules for CitySearch
city guide services, the timing and amount of license and royalty payments
from the Company's partners, the Company's ability to increase the volume of
online ticket sales through the Ticketmaster Online Web site, the Company's
ability to retain existing business customers, attract new business customers
at a steady rate and maintain customer satisfaction, the timing and volume of
new business Web site orders and the Company's capacity to meet such orders,
the Company's ability to maintain or increase current rates of sales
productivity, the announcement or introduction of new or enhanced sites and
services by the Company or its competitors, the amount of traffic on the
Company's online sites, the amount of expenditures for online advertising by
businesses, the level of use of the Web and online services and consumer
acceptance of the Internet for services such as those offered by the Company,
the Company's ability to upgrade and develop its systems and attract personnel
in a timely and effective manner, the amount and timing of operating costs and
capital expenditures relating to expansion of the Company's business and
infrastructure, technical difficulties, system downtime or Internet brownouts,
political or economic events affecting the cities in which the Company
operates and general economic conditions. Unfavorable changes in any of the
above factors

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<PAGE>

could adversely affect the Company's revenues, gross margins and results of
operations in future periods. In addition, Ticketmaster Online derives a
majority of its revenues directly or indirectly from the sale of tickets and
related merchandise for live entertainment, sporting and leisure events and is
directly affected by the popularity, frequency and location of such events.
Factors affecting the demand for and attendance of such events include,
without limitation, general economic conditions, consumer trends and work
stoppages. Any occurrence or condition that results in decreased attendance or
demand for such entertainment, sporting and leisure events would likely have a
material adverse effect on the Company's business, financial condition and
results of operations.

As a result of the foregoing, the Company believes that period-to-period
comparisons of its results of operations should not be relied upon as an
indication of future performance. In addition, the results of any quarterly
period are not indicative of results to be expected for a full fiscal year.
The foregoing factors which are largely unpredictable and may cause
significant fluctuations in operating results may cause the Company's annual
or quarterly results of operations to be below the expectations of public
market analysts or investors, in which case the market price of the Class B
Common Stock could be materially and adversely affected. See "Management's
Discussion and Analysis of Financial Condition and Results of Operations."

NEW AND UNCERTAIN MARKETS; UNPROVEN MARKET ACCEPTANCE; RISK OF SIGNIFICANT
BUSINESS CUSTOMER TURNOVER

The markets for the Company's services have only recently begun to develop,
are rapidly evolving and are characterized by a number of entrants that have
introduced or plan to introduce competing services. As is typical in the case
of new and rapidly evolving industries, demand and market acceptance for
recently introduced services are subject to a high level of uncertainty and
risk. It is therefore difficult to predict the size and future growth rate, if
any, of these markets. There can be no assurance that the markets for the
Company's services will develop or that demand for the Company's services will
emerge or become economically sustainable. The success of the Ticketmaster
Online service will depend on the willingness of consumers to purchase tickets
to live events and related merchandise online and on Ticketmaster Online's
ability to significantly increase online traffic and sales volume. The success
of CitySearch's city guide service will depend on the willingness of local
businesses to pay for custom business Web sites developed by CitySearch and to
retain the service, which in turn may depend on the popularity of the guides
to consumers and on the actual or perceived revenues attributable to the
services. If such businesses are unwilling to pay for the CitySearch service
or retain the service, if the markets for the Company's services otherwise
fail to develop or develop more slowly than anticipated or if business
customer turnover rates are higher than expected by the Company, the Company's
business, financial condition and results of operations could be materially
and adversely affected. The turnover rate of business customers using
CitySearch's service has been higher than CitySearch had anticipated, and
there can be no assurance that such turnover rates would be at levels which
would not in the future materially and adversely affect the Company's
business, financial condition and results of operations. There can be no
assurance that businesses will elect to outsource the design, development and
maintenance of their Web sites to services such as CitySearch. Businesses may
elect to perform such tasks internally, particularly if third-party providers
of such services prove to be unreliable, ineffective or too expensive or if
software companies offer user-friendly and cost-effective tools for such
purpose. In the event that a significant number of businesses internalize such
tasks, such event may have a material adverse effect on the Company's
business, financial condition and results of operations.

DEPENDENCE ON CONTINUED GROWTH OF ONLINE COMMERCE

The Company's future revenues and any future profits are substantially
dependent upon the widespread acceptance and use of the Web and online
services as an effective medium of commerce by consumers. Rapid growth in the
use of and interest in the Web, the Internet and commercial online services is
a recent phenomenon, and there can be no assurance that acceptance and use
will continue to develop or that a sufficiently broad base of consumers will
adopt, and continue to use, the Web and online services as a medium of
commerce, particularly

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<PAGE>

for purchasing tickets to live events and related merchandise. Demand for
recently introduced services and products over the Web and online services is
subject to a high level of uncertainty, and there are relatively few proven
services and products. The development of the Web and online services as a
viable commercial marketplace is subject to a number of factors, including
continued growth in the number of Internet users and users of such services,
concerns about transaction security, continued development of the necessary
technological infrastructure and the development of complementary services and
products. If the Web and online services do not become a viable commercial
marketplace, the Company's business, financial condition and results of
operations would be materially and adversely affected. See "Management's
Discussion and Analysis of Financial Condition and Results of Operations."

CITYSEARCH'S RELIANCE ON STRATEGIC RELATIONSHIPS

An important element of the Company's current business strategy with respect
to the CitySearch service is to enter into agreements with local media
companies to establish and support city guides. The Company has entered into,
and intends to enter into, agreements with media companies to address
opportunities. In these "partner-led" markets, the Company develops and
designs a city guide for local media companies and licenses certain
intellectual property to such companies in exchange for certain up-front and
continuing license payments and royalty payments. These royalty payments are
based on the amount of revenues generated by such companies through the
partner-led city guides. The Company currently anticipates that royalty
payments from such agreements will constitute a significant portion of the
Company's revenues in future periods. Accordingly, the Company's success will
depend in large part upon the ability of CitySearch's partners to timely
launch city guides in partner-led markets and the extent to which these
partners are able to generate revenue through their city guides. Under the
terms of the Company's agreements with its media company partners, the Company
has very limited control over the amount of time and financial resources that
a partner devotes to the launch of a city guide or over the day-to-day
operations and management of the city guide, including the marketing and sale
of business Web sites to potential business customers. For example, one of the
Company's partners did not launch its city guide in accordance with the
Company's initial expectations, thereby delaying revenues subject to royalty
payments payable to the Company. Furthermore, some of the Company's agreements
grant exclusivity in certain territories. There can be no assurance that the
Company's partners that are in the process of developing new city guides or
future partners will launch their sites in a timely manner, or at all, or that
if launched, such sites will generate revenues consistent with the Company's
expectations. Furthermore, due to the Company's limited experience with
partner-led city guides, it is unable to accurately forecast its revenues to
be derived from these agreements with such partners. Exclusivity provisions in
some of the Company's agreements place certain limitations on the Company's
ability to license its intellectual property to other partners. There also can
be no assurance that the Company will successfully enter into partnerships
with media companies in additional cities with respect to the CitySearch
service. In addition, certain of the Company's agreements with its media
company partners may be terminated for failure to meet performance criteria.
Any failure by one of the Company's proposed partner-led city guides to launch
in a timely manner or by one of the Company's existing partner-led city guides
to generate sufficient revenues, or a failure by the Company to enter into or
to renew agreements with media company partners on terms favorable to the
Company or early termination of certain existing agreements could have a
material adverse effect on the Company's business, financial condition and
results of operations.

The Company has recently entered into a license and services agreement with
Classified Ventures, pursuant to which the Company will license elements of
its technology and business systems to Classified Ventures and provide
services in automotive and real estate classified advertising categories. The
Company expects to receive significant revenues from licensing and service
fees under this agreement. Under this agreement, the Company is restricted
from entering into certain classified advertising markets and from licensing
its technology and business systems to competitors of Classified Ventures. In
addition, this agreement may be terminated effective 2001 by Classified
Ventures and there can be no assurance that it will be renewed on terms
favorable to the Company. The failure of the Company to meet certain
milestones under this agreement, early termination of this agreement or the
inability of the Company to compete with Classified Ventures or to license
technology to competitors of

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<PAGE>

Classified Ventures may have a material adverse effect on the Company's
business, financial condition and results of operations.

In its owned and operated markets, the Company has entered into co-promotion
or distribution agreements with a number of television, radio, print media and
online companies. Some of these agreements are of a short duration and there
can be no assurance that the Company's co-promotion or distribution partners
with respect to the CitySearch business will not terminate their agreements
with the Company or that the Company will secure additional co-promotion or
distribution partners in the future which could have a material adverse effect
on the Company's business, financial condition and results of operations.

TICKETMASTER ONLINE'S RELIANCE ON STRATEGIC RELATIONSHIPS

Ticketmaster Online's business is to an extent dependent on its (and
Ticketmaster Corp.'s) relationships with certain strategic partners, including
Yahoo! Inc. ("Yahoo!") relating to the sharing of certain Ticketmaster Online
Web site and user links between the Yahoo! and Ticketmaster Online sites. The
Company expects to derive significant benefits, including increased revenues
and consumer awareness, from these agreements. Such arrangements also include,
in certain cases, non-competition provisions that restrict the ability of the
Company to engage in similar activities on its own or with other partners.
There can be no assurance that these relationships will continue, that such
strategic relationships will be successful in any respect or that the Company
will be able to find suitable additional or replacement strategic partners.
The failure of such relationships could have a material adverse effect on the
Company's business, financial condition and results of operations. See "--
Potential Governmental Investigations and Litigation" and "Business--
Ticketmaster Online Business--Ticketmaster Online Strategic Alliances."

DEPENDENCE ON SALES PERSONNEL

The Company currently derives and, for the foreseeable future, intends to
derive a substantial portion of its revenues from sales of business Web sites
to local businesses in markets in which it owns and operates CitySearch city
guides. The Company depends on its direct sales force to sell business Web
sites in these markets. The creation of new revenue from CitySearch's city
guide service and its roll-out in additional cities requires the services of a
highly trained sales force working directly for the Company. Accordingly, a
shortage in the number of trained salespeople could limit the Company's
ability to sell business Web sites as it rolls out its service in new cities
or to maintain or increase its number of business customers in cities in which
CitySearch already operates. The Company has in the past and expects in the
future to experience a high rate of turnover in its direct sales force. There
can be no assurance that such turnover will not increase in the future or have
a material adverse effect on the Company's sales, which could have a material
adverse effect on the Company's business, financial condition and results of
operations. In addition, Ticketmaster Online currently derives a significant
portion of its revenues from the sale of banner advertising and sponsorships.
A shortage in the number of trained salespeople could limit the Company's
ability to sell additional banner advertising or sponsorships or renew
existing sponsorship or advertising relationships which could have a material
adverse effect on the Company's business, financial condition and results of
operations.

DEPENDENCE ON KEY PERSONNEL; NEED TO HIRE ADDITIONAL QUALIFIED PERSONNEL

The Company's success depends to a significant degree upon the continued
contributions of the Company's executive management team, including Charles
Conn, the Company's Chief Executive Officer, Thomas Layton, President and
Chief Operating Officer of the Company, and Robert Perkins, Executive Vice
President, Ticketing and Electronic Commerce. In connection with the Merger,
Mr. Conn and Mr. Layton received certain payments in exchange for entering
into non-competition agreements with CitySearch, Ticketmaster Corp. and
Ticketmaster Online (the "Non-Competition Agreements"), and the vesting of
options to purchase the Company's Class A Common Stock previously granted to
Mr. Conn and Mr. Layton was accelerated so that such options became fully
exercisable upon consummation of the Merger. The loss of the services of
Messrs. Conn, Layton or Perkins or other members of the Company's management
team could have a material adverse effect on the Company's

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<PAGE>

business, financial condition and results of operations. In addition,
Ticketmaster Online has been managed historically by the management of
Ticketmaster Corp. The success of the Company will depend upon a successful
transition of Ticketmaster Online's management responsibility to the Company's
senior management team. The Company's employees, including its senior
officers, may voluntarily terminate their employment with the Company at any
time, and competition for qualified employees is intense. The Company's
success also depends upon its ability to attract and retain additional highly
qualified management, technical and sales and marketing personnel. The process
of locating and hiring such personnel with the combination of skills and
attributes required to carry out the Company's strategy is often lengthy. The
loss of the services of key personnel or the inability to attract additional
qualified personnel could have a material adverse effect on the Company's
business, financial condition and results of operations.

UNCERTAIN ACCEPTANCE AND MAINTENANCE OF CITYSEARCH BRAND

The Company believes that establishing and maintaining the CitySearch brand
is critical to its efforts to attract consumers and business customers to its
sites and that the importance of brand recognition will increase due to the
growing number of Internet sites and relatively low barriers to entry to
providing Internet content. Promotion of the CitySearch brand will depend
largely on the success of CitySearch and its media company partners in
providing high quality Internet content. Under the terms of its agreements
with its media company partners, the Company has very limited control over the
content provided on the CitySearch partners' sites. If consumers and business
customers do not perceive the content of CitySearch's or its partners'
existing sites to be of high quality, the Company will be unsuccessful in
promoting and maintaining the CitySearch brand. Furthermore, not all of the
Company's partners promote the CitySearch brand on their services with a high
level of prominence. In addition, users accessing partner-led market sites
that contain different interfaces from the Company's owned and operated sites
may be confused by the differences in interface or navigation, and any such
confusion may inhibit the Company's ability to develop its brand and network.
Other than links to CitySearch's city sites, the Company has not entered into
a significant distribution relationship with any major online search or
navigation company. In order to attract and retain consumers and business
customers, and to promote the CitySearch brand in response to competitive
pressures, the Company may find it necessary to increase its budget for
content or otherwise to increase substantially its financial commitment to
creating and maintaining a distinct brand loyalty among consumers and business
customers. If either the Company or its media company partners are unable to
provide high quality content or otherwise fail to promote and maintain the
CitySearch brand or if the Company incurs excessive expenses in an attempt to
improve its CitySearch content or promote and maintain the CitySearch brand,
the Company's business, financial condition and results of operations could be
materially and adversely affected.

RISKS ASSOCIATED WITH ROLL OUT OF SERVICES

The Company's future success will depend to a significant extent on its
ability, on its own and with partners, to rapidly roll out the CitySearch
local city guide service in additional cities in the United States and
internationally. As of September 30, 1998, the Company had launched its local
city guide service in 15 metropolitan areas and intends to expand its service
in additional cities in the United States and internationally. There can be no
assurance that the Company will be able to launch the CitySearch service in
additional markets in a cost-effective or timely manner or in accordance with
its planned schedule, or that any newly launched service will achieve market
acceptance. Any new service that is not favorably received by local businesses
or consumers could damage the Company's reputation or the CitySearch brand.
Launching the CitySearch service or future services offered by the Company
will also require significant additional expenses and will strain the
Company's management, financial and operational resources. In particular, the
launch of the CitySearch service in additional cities will require the Company
to expand and upgrade its technology infrastructure and business systems,
including its enterprise management system (i.e., an integrated set of
software tools and business processes for sales force management, Web site
production, customer service and billing) and its business Web site production
system. The Company is in the process of launching a new version of the
software underlying the CitySearch service. There can be no assurance that
this new version will function as intended, and any failure of the software
could have a material adverse effect on the Company's business, financial
condition and results

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<PAGE>

of operations. There can be no assurance that the existing technology used by
Ticketmaster Online would be able to accommodate increased volumes of traffic
and transactions that may arise in the future. Expansion or increases of the
Company's technology capabilities could result in significant expenses.
Moreover, the strain placed on the Company's resources by simultaneous
launches of the CitySearch service in multiple cities and the Company's
efforts to integrate CitySearch's local content with the event-specific
content and transactional capabilities of Ticketmaster Online may adversely
affect the roll-out schedule or quality of the service in a particular city.
The Company's failure to launch the CitySearch service in new markets in a
timely and cost effective manner in accordance with its planned schedule or
the lack of market acceptance of new services would have a material adverse
effect on the Company's business, financial condition and results of
operations.

RISKS OF FIXED-PRICE CONTRACTS

The services offered by the Company to CitySearch business customers
typically consist of the design, implementation, hosting and maintenance of
customized Web sites, for which the customers are billed on a fixed-price
basis, consisting of an up-front fee and monthly fees. The Company's failure
to estimate accurately the resources and time required for providing such
services, to manage client expectations effectively regarding the scope of
services to be delivered for the estimated fees or to complete the services
within budget, on time and to clients' satisfaction would expose the Company
to risks associated with cost overruns and customer dissatisfaction, which
could have a material adverse effect on the Company's business, financial
condition and results of operations. See "Management's Discussion and Analysis
of Financial Condition and Results of Operations."

COMPETITION

The markets for local interactive content and services are highly
competitive. Currently, CitySearch's primary competitors include Digital City,
Inc., a company wholly-owned by America Online, Inc. and Tribune Company and
Microsoft Corporation (Sidewalk). CitySearch also competes against search
engine and other site aggregation companies which primarily serve to aggregate
links to sites providing local content such as Excite, Inc. (City.Net), Lycos,
Inc. (Lycos City Guide) and, while it is also a strategic partner of
Ticketmaster Online, Yahoo! (Yahoo! Local). In addition, CitySearch competes
against offerings from media companies, including Cox Interactive Media, Inc.,
Knight Ridder, Inc. and Zip2 Corporation, as well as offerings from several
telecommunications and cable companies and Internet service providers that
provide local interactive programming such as SBC Communications, Inc. (At
Hand) and MediaOne Group, Inc. (DiveIn). There are also numerous niche
competitors which focus on a specific category or geography and compete with
specific content offerings provided by the Company. The Company may also
compete with online services and other Web site operators, as well as
traditional media such as television, radio and print, for a share of
advertisers' total advertising budgets. The Company faces different
competitors in most of its CitySearch markets. For example, competitors in the
San Francisco Bay Area, the Company's largest market in terms of CitySearch
subscription and services revenues for the nine months ended September 30,
1998 (i.e., accounting for approximately 17% of such revenues during such
period) primarily included Microsoft Corporation (Sidewalk), America Online,
Inc. (Digital City) and Yahoo! (SF Bay). Competitors in Raleigh-Durham-Chapel
Hill, the Company's second largest market in terms of subscription and
services revenues for the nine months ended September 30, 1998 (i.e.,
accounting for approximately 16% of such revenues during such period)
primarily included the Web site operated by The Raleigh News & Observer, WRAL-
TV, trianglerestaurants.com, Digital Center (raleighonline.com), Yahoo! Local
and Internet Presentations, Inc. (citydirect.com). Furthermore, additional
major media and other companies with financial and other resources greater
than those of the Company may introduce new Internet products and services
addressing these markets in the future. There can be no assurance that the
Company's competitors will not develop services that are superior to those of
the Company or that achieve greater market acceptance than the Company's
offerings.

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<PAGE>

that handle their own ticket sales and distribution through online and other
distribution channels, live event automated ticketing companies with Web sites
which may or may not currently offer online transactional capabilities and
certain Web-based live event ticketing companies which only conduct business
online. Where facilities and promoters decide to utilize the services of a
ticketing company, Ticketmaster Corp. and Ticketmaster Online compete with
international, national and regional ticketing services, including TicketWeb,
Telecharge (Shubert Ticketing Services), NEXT Ticketing, Advantix, ETM
Entertainment Network, Dillard's, Prologue, Capital Tickets and Lasergate
(Lasergate Systems, Inc.). Several of Ticketmaster Corp.'s and Ticketmaster
Online's competitors have operations in multiple locations throughout the
United States and compete with Ticketmaster Corp. and Ticketmaster Online on a
national level, while others compete with Ticketmaster Corp. and Ticketmaster
Online principally in one specific geographic region. In certain specific
geographic regions, including certain of the local markets in which CitySearch
provides or intends to provide its local city guide service, one or more of
these competitors may serve as the primary ticketing service in the region.
The Company believes that Ticketmaster Online will experience significant
difficulty in establishing a significant online presence in such regions and,
as a result, any local city guide for such a region may be unable to provide
significant ticketing capabilities. There can be no assurance that one or more
of these regional automated ticketing companies will not expand into other
regions or nationally, which could have a material adverse effect on the
Company's business, financial condition and results of operations.

Furthermore, certain of Ticketmaster Online's competitors may have financial
and other resources greater than those of the Company and may introduce new
Internet products and services in these markets in the future. There can be no
assurance that Ticketmaster Online's competitors will not develop services
superior to those of Ticketmaster Online or achieve greater acceptance than
Ticketmaster Online's offerings. In addition, pursuant to the Ticketmaster
License Agreement, Ticketmaster Online is restricted from entering into
agreements with facilities, promoters or other ticket sellers for the online
sale of live event tickets. As a result, Ticketmaster Online is dependent on
the ability of Ticketmaster Corp. to acquire and maintain live event ticketing
rights, including online ticketing rights, with facilities and promoters and
to negotiate commercially favorable terms for such rights. Furthermore,
substantially all of the tickets sold through Ticketmaster Online's Web site
are also sold by Ticketmaster Corp. by telephone and through independent
retail outlets. Such sales by Ticketmaster Corp. could have a material adverse
effect on Ticketmaster Online's online sales, and as a result, on the
Company's business, financial condition and results of operations.

The Company believes that the principal competitive factors include depth,
quality and comprehensiveness of content, ease of use, distribution, search
capability and brand recognition. Many of the Company's competitors, whether
with respect to its CitySearch service or its Ticketmaster Online service,
have greater financial and marketing resources than the Company and may have
significant competitive advantages through other lines of business and
existing business relationships. There can be no assurance that the Company
will be able to successfully compete against its current or future competitors
or that competition will not have a material adverse effect on the Company's
business, financial condition and results of operations. Furthermore, as a
strategic response to changes in the competitive environment, the Company may
make certain pricing, servicing or marketing decisions or enter into
acquisitions or new ventures that could have a material adverse effect on the
Company's business, financial condition and results of operations.

RISKS ASSOCIATED WITH OFFERING NEW BUSINESS AND CONSUMER SERVICES

The Company is expected to introduce new and expanded services in order to
generate additional revenues, attract more businesses, consumers and respond
to competition. For example, the Company recently introduced business Web
sites containing new and enhanced functionality for its CitySearch business
customers. The Company also may in the future offer services facilitating the
purchase of goods by consumers from CitySearch's business customers or others.
A key element of the Company's strategy is to technologically enable its city
guides so that consumers and its business customers can buy and sell goods and
services online through the Company's city guides. The Company has limited
experience in building e-commerce functionality with its city guides. There
can be no assurance that the Company will be able to offer e-commerce or other
new services in a

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cost-effective or timely manner or that any such efforts would be successful.
Furthermore, any new service launched by the Company that is not favorably
received by consumers could damage the Company's reputation or its brand
names. Expansion of the Company's services in this manner would also require
significant additional expenses and development and may strain the Company's
management, financial and operational resources. The Company's inability to
generate revenues from such expanded services sufficient to offset their cost
could have a material adverse effect on the Company's business, financial
condition and results of operations.

MANAGEMENT OF POTENTIAL GROWTH; RISKS ASSOCIATED WITH EXPANSION

CitySearch's and Ticketmaster Online's businesses have grown rapidly in
recent periods. The growth of their businesses and expansion of their consumer
bases have placed a significant strain on their management and operations. The
growth of the businesses of CitySearch and Ticketmaster Online has resulted,
and for the Company is expected in the future to result, in the growth in the
number of its employees, in the establishment of offices in disparate regions
of the country and in increased responsibility for both existing and new
management personnel. In addition, this growth has and will put additional
pressure on existing operational, financial and management information
systems. The Company's success will depend to a significant extent on the
ability of its executive officers and other members of senior management to
operate effectively, both independently and as a group. To manage its growth,
the Company must continue to implement and improve operational, financial and
management information systems and hire and train additional qualified
personnel, including sales and marketing staff. There can be no assurance that
the Company will be able to manage recent or any future expansions
successfully, and any failure of the Company to do so could have a material
adverse effect on the Company's business, financial condition and results of
operations. There also can be no assurance that either CitySearch or
Ticketmaster Online will be able to sustain the rate of expansion that each
has experienced in the past.

DEPENDENCE UPON CONTINUED CONTENT DEVELOPMENT

The Company's success depends in part upon its ability to deliver compelling
interactive content on its CitySearch service, such as local events
information, recreation, business, shopping, professional services and
news/sports/weather and online ticketing services in order to attract
consumers with demographic characteristics valuable to CitySearch's business
customers, as well as its ability to develop and integrate compelling content
with existing ticketing capabilities on the Ticketmaster Online Web site.
There can be no assurance that the Company will be successful in developing
new content and services or enhancing CitySearch's existing local city guide
service or the Ticketmaster Online service on a timely basis, or that such
content and services will effectively address consumer requirements and
achieve market acceptance. If the Company, for technological or other reasons,
is unable to develop and enhance CitySearch's and Ticketmaster Online's local
interactive content and services in a manner compatible with emerging industry
standards and that allows it to attract, retain and expand a consumer base
possessing demographic characteristics attractive to CitySearch's business
customers and Ticketmaster Online's advertisers and sponsors, the Company's
business, financial condition and results of operations would be materially
and adversely affected.

DEPENDENCE ON INCREASED USAGE AND STABILITY OF THE INTERNET AND THE WEB

The usage of the Web for services such as those offered by the Company will
depend in significant part on continued rapid growth in the number of
households and commercial, educational and government institutions with access
to the Web, in the level of usage by individuals and in the number and quality
of products and services designed for use on the Web. Because usage of the Web
as a source for information, products and services is a relatively recent
phenomenon, it is difficult to predict whether the number of users drawn to
the Web will continue to increase and whether any significant market for usage
of the Web for such purposes will continue to develop and expand. There can be
no assurance that Internet usage patterns will not decline as the novelty of
the medium recedes or that the quality of products and services offered online
will improve sufficiently to continue to support user interest. Failure of the
Web to stimulate user interest and be accessible to a broad audience at
moderate costs would jeopardize the markets for the Company's services.

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Moreover, issues regarding the stability of the Internet's infrastructure
remain unresolved. The rapid rise in the number of Internet users and
increased transmission of audio, video, graphical and other multimedia content
over the Web has placed increasing strains on the Internet's communications
and transmission infrastructures. Continuation of such trends could lead to
significant deterioration in transmission speeds and reliability of the Web
and could reduce the usage of the Web by businesses and individuals. In
addition, to the extent that the Web continues to experience significant
growth in the number of users and level of use without corresponding increases
and improvements in the Internet infrastructure, there can be no assurance
that the Internet will be able to support the demands placed upon it by such
continued growth. Any failure of the Internet to support such increasing
number of users due to inadequate infrastructure or otherwise would seriously
limit the development of the Web as a viable source of local interactive
content and services, which could materially and adversely affect the
acceptance of the Company's services, which would, in turn, materially and
adversely affect the Company's business, financial condition and results of
operations.

RISKS ASSOCIATED WITH INTERNATIONAL EXPANSION

A key component of the Company's strategy is to continue to expand its
services into international markets. The Company anticipates that it will
expend significant financial and management resources to operate overseas and,
with respect to the CitySearch service, create localized user interfaces
through the launch of additional partner-led markets. The Company believes
Ticketmaster Corp. intends to continue to expand its operations outside of the
United States, which will require additional resources from Ticketmaster
Online to the extent it distributes tickets online in those markets. If the
revenues generated by these international operations are insufficient to
offset the expense of establishing and maintaining such operations, the
Company's business, financial condition and results of operations will be
materially and adversely affected. To date, CitySearch has limited experience
in developing localized versions of its online sites and marketing and
distributing its products and services internationally. There can be no
assurance that the Company or its partners will be able to successfully market
or sell its services in these international markets. In addition to the
uncertainty as to the Company's ability to expand its international presence,
there are certain risks inherent in conducting business on an international
level, such as unexpected changes in regulatory requirements, tariffs and
other trade barriers, difficulties in staffing and managing foreign
operations, political instability, currency rate fluctuations and potentially
adverse tax consequences. There can be no assurance that one or more of the
foregoing factors will not have a material adverse effect on the Company's
current and future international operations and, consequently, on its
business, financial condition and results of operations.

CAPACITY CONSTRAINTS AND SYSTEM DISRUPTIONS; RELIANCE ON THIRD-PARTY SYSTEMS

The satisfactory performance, reliability and availability of CitySearch's
city guides and Ticketmaster Online's online service and their network
infrastructures are critical to attracting Web users and maintaining
relationships with business customers and consumers. System interruptions that
result in the unavailability of sites or slower response times for consumers
would reduce the number of business Web sites and advertisements purchased and
reduce the attractiveness of CitySearch's local city guides and Ticketmaster
Online's online service to business customers and consumers. CitySearch and
Ticketmaster Online have experienced system interruptions in the past and
believe that such interruptions will continue to occur from time to time in
the future. Additionally, any substantial increase in traffic on CitySearch's
local city guides and Ticketmaster Online's online service will require the
Company to expand and adapt its network infrastructure. The Company's
inability to add additional software and hardware to accommodate increased
traffic on CitySearch's local city guides and Ticketmaster Online's online
service may cause unanticipated system disruptions and result in slower
response times. In addition, CitySearch currently depends on a limited number
of suppliers for certain key technologies used to roll out and manage the
CitySearch service, including Exodus Communications, Inc., which hosts the
CitySearch city guides, and PSINet, which hosts the Ticketmaster Online
service. There can be no assurance that the Company will be able to expand its
network infrastructure on a timely basis to meet increased demand or that key
technology suppliers will continue to provide the Company with products and
services that meet the Company's requirements. Any increase in system
interruptions or slower response times resulting from the

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foregoing factors could have a material adverse effect on the Company's
business, financial condition and results of operations.

The Company's operations are vulnerable to interruption by fire, earthquake,
power loss, telecommunications failure and other events beyond the Company's
control. Substantially all of the Company's server equipment is currently
located in California in areas that are susceptible to earthquakes. The
Company's business interruption insurance may not be sufficient to compensate
the Company for losses that may occur and would not compensate the Company for
the loss of consumer goodwill due to disruption of service, and any losses or
damages incurred by the Company could have a material adverse effect on its
business, financial condition and results of operations.

In addition, Ticketmaster Online's operations are substantially dependent
upon services and infrastructure provided by Ticketmaster Corp. that enable
Ticketmaster Online to access information on ticket and merchandise inventory,
events and consumers maintained by Ticketmaster Corp. In addition,
Ticketmaster Corp. has agreed to provide all order processing, payment
processing and fulfillment services for tickets to live events and merchandise
ordered through Ticketmaster Online pursuant to the terms and subject to the
limitations of the Ticketmaster License Agreement. Any discontinuation or
disruption of such services by Ticketmaster Corp. would be disruptive to the
Ticketmaster Online business and would likely have a material adverse effect
on the Company's business, financial condition and results of operations. See
"--Dependence on Relationship with Ticketmaster Corp." and "Business--
Ticketmaster Online Business."

Ticketmaster Online uses a custom-developed system for its online ticketing
operations and certain aspects of transaction processing. Ticketmaster Online
has experienced temporary system interruptions, which may continue to occur in
the future from time to time. Any substantial increase in the volume of
traffic on the Company's online sites or the number of tickets purchased by
consumers may require Ticketmaster Online to expand and upgrade further its
technology, transaction-processing systems and network infrastructure.
Ticketmaster Online has experienced and expects to continue to experience
temporary capacity constraints due to sharply increased traffic for certain
events, which may cause unanticipated system disruptions, slower response
times and degradation in levels of service. In addition, to the extent
Ticketmaster Online experiences delays in processing ticketing confirmations
and reporting accurate financial information, its operations would be
adversely affected. There can be no assurance that Ticketmaster Online's
transaction-processing systems and network infrastructure will be able to
accommodate such increases in traffic in the future, or that the Company will,
in general, be able to accurately project the rate or timing of such increases
or upgrade its systems and infrastructure to accommodate future traffic levels
on its online sites. In addition, there can be no assurance that Ticketmaster
Online will be able to effectively upgrade and expand its transaction-
processing systems in a timely manner or to successfully integrate any newly
developed or purchased components of its existing systems. Any inability to do
so could have a material adverse effect on the Company's business, financial
condition and results of operations. See "Business--Ticketmaster Online
Business."

ONLINE COMMERCE AND DATABASE SECURITY RISKS

A fundamental requirement for online commerce and communications is the
secure transmission of confidential information over public networks. The
Company relies on encryption and authentication technology licensed from third
parties to provide the security and authentication necessary to effect secure
transmission of confidential information, such as consumers credit card
numbers. In addition, the Company maintains an extensive confidential database
of consumer profiles and transaction information. There can be no assurance
that advances in computer capabilities, new discoveries in the field of
cryptography, or other events or developments will not result in a compromise
or breach of the methods used by the Company to protect consumer transaction
and personal data contained in the Company's database. If any such compromise
of the Company's security were to occur, it could have a material adverse
effect on the Company's reputation and on its business, operating results and
financial condition. A party who is able to circumvent the Company's security
measures could misappropriate proprietary information or cause interruptions
in the Company's operations. The Company may be required to expend significant
capital and other resources to protect against such security breaches or to

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alleviate problems caused by such breaches. Concerns over the security of
transactions conducted on the Internet and commercial online services and the
privacy of users may also inhibit the growth of the Web and online services as
a means of conducting commercial transactions. To the extent that activities
of the Company or third-party contractors involve the storage and transmission
of proprietary information, such as credit card numbers or other personal
information, security breaches could expose the Company to a risk of loss or
litigation and possible liability. In addition, the Company may suffer losses
as a result of orders placed with fraudulent credit card data, even though the
consumer's payment for such orders has been authorized by the associated
financial institution. Under current credit card practices, a merchant is
liable for fraudulent credit card transactions where, as is the case with the
transactions processed by the Company, no cardholder signature is obtained.
There can be no assurance that the Company will not suffer significant losses
as a result of fraudulent use of credit card data in the future, which could
have a material adverse effect on the Company's business, financial condition
and results of operations. See "Business--CitySearch Business--Technology" and
"Business--Ticketmaster Online Business--Technology."

RAPID TECHNOLOGICAL CHANGE

The Internet and the online commerce industry are characterized by rapid
technological change, changes in user and customer requirements and
preferences, frequent new product and service introductions embodying new
technologies and the emergence of new industry standards and practices that
could render the Company's existing online sites and proprietary technology
and systems obsolete. The emerging nature of these products and services and
their rapid evolution will require that the Company continually improve the
performance, features and reliability of its online services, particularly in
response to competitive offerings. The Company's success will depend, in part,
on its ability to enhance its existing services, to develop new services and
technology that address the increasingly sophisticated and varied needs of its
prospective customers and to respond to technological advances and emerging
industry standards and practices on a cost-effective and timely basis. The
development of online sites and other proprietary technology entails
significant technical and business risks and requires substantial expenditures
and lead time. There can be no assurance that the Company will successfully
use new technologies effectively or adapt its online sites, proprietary
technology and transaction-processing systems to customer requirements or
emerging industry standards. If the Company is unable, for technical, legal,
financial or other reasons, to adapt in a timely manner in response to
changing market conditions or customer requirements, its business, operating
results and financial condition could be materially adversely affected. See
"Business--CitySearch Business--Technology" and "Business--Ticketmaster Online
Business--Technology."

YEAR 2000 COMPLIANCE

Many older computer systems and software products currently in use are coded
to accept only two digit entries in the date code field. These date code
fields will need to accept four digit entries to distinguish 21st century
dates from 20th century dates. As a result, in less than two years, computer
systems and/or software used by many companies may need to be upgraded to
comply with such "Year 2000" requirements. Significant uncertainty exists in
the software industry concerning the potential effects associated with such
compliance. Although the Company licenses to its CitySearch partners software
products that are designed to be Year 2000 compliant, there can be no
assurance that the Company's software products contain all necessary date
changes. In addition, Ticketmaster Online is largely dependent on Ticketmaster
Corp. to ensure that all of its software used in connection with its online
ticketing service will manage and manipulate data involving the transition of
dates from 1999 to 2000 without functional or data abnormality and without
inaccurate results related to such dates. Any failure by Ticketmaster Online
or Ticketmaster Corp. to ensure that such software complies with Year 2000
requirements could have a material adverse effect on the Company's business,
financial condition and results of operations. Furthermore, while the Company
has developed a plan to identify programs used by its computer systems that
may require modification, and has initiated programs to rectify any such
problems, there can be no assurance that such plans and programs will be
effective in making such programs Year 2000 compliant or will be completed
prior to December 31, 1999. In addition, the Company utilizes third-party
equipment and the Company licenses software from third parties that may not be
Year 2000 compliant. Failure

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of the Company's software or internal computer systems or of third-party
equipment or software utilized by the Company to be Year 2000 compliant could
result in a material adverse affect on the Company's business, financial
condition and results of operations. Furthermore, the spending patterns of
business customers or potential business customers may be affected by Year
2000 issues as companies expend significant resources to correct or update
their current systems for Year 2000 compliance. These expenditures may result
in reduced funds available for such customers to pay for custom Web sites,
license the Company's software products and retain the Company's services,
which could have a material adverse effect on the Company's business,
financial condition and results of operations. See "Management's Discussion
and Analysis of Financial Condition and Results of Operations--Year 2000."

LIABILITY FOR ONLINE CONTENT

The Company may face potential liability for defamation, negligence,
copyright, patent or trademark infringement and other claims based on the
nature and content of the materials that appear on the CitySearch or
Ticketmaster Online sites or on sites operated by their respective partners.
Such claims have been brought, and sometimes successfully pressed, against
online services. Although the Company intends to continue its general
liability insurance, the Company's insurance may not cover claims of these
types or may not be adequate to indemnify the Company for any liability that
may be imposed. Any imposition of liability, particularly liability that is
not covered by insurance or is in excess of insurance coverage, could have a
material adverse effect on the Company's reputation and its business,
financial condition and results of operations.

UNCERTAIN PROTECTION OF INTELLECTUAL PROPERTY; RISKS OF THIRD-PARTY LICENSES

The Company regards its copyrights, service marks, trademarks, trade dress,
trade secrets, proprietary software and similar intellectual property as
critical to its success, and relies on trademark and copyright law, trade
secret protection and confidentiality and/or license agreements with
employees, customers, partners and others to protect its proprietary rights.
The Company does not hold any patents. The Company pursues the registration of
certain of its key trademarks and service marks in the United States and
internationally. Effective trademark, service mark, copyright and trade secret
protection may not be available or sought by the Company in every country in
which the Company's products and services are made available online. The
Company has licensed in the past, and expects that it may license in the
future, certain proprietary rights, such as trademarks or copyrighted
material, to third parties. In addition, the Company has licensed in the past,
and expects that it may license in the future, certain content, including
trademarks and copyrighted material, from third parties. While the Company
attempts to ensure that the quality of its brands is maintained by such
licensees, there can be no assurance that such licensees will not take actions
that might materially adversely affect the value of the Company's proprietary
rights or reputation, which could have a material adverse effect on the
Company's business, financial condition and results of operations. There can
be no assurance that the steps taken by the Company to protect its proprietary
rights will be adequate or that third parties will not infringe or
misappropriate its copyrights, trademarks, trade dress and similar proprietary
rights. In addition, there can be no assurance that other parties will not
assert infringement claims, including patent infringement claims, against the
Company. The Company licenses the trademark "CitySearch" from a third party,
and there can be no assurance that the Company will be able to continue to
license the trademark on terms acceptable to the Company. The licensor of the
trademark has filed an application for United States registration of the
CitySearch trademark with the United States Patent and Trademark Office
("USPTO") and has recently received communications from an entity affiliated
with Citigroup seeking an extension of the time period during which third
parties may oppose registration of the mark to the licensor of such trademark.
There can be no assurance that the USPTO will grant registration of the
CitySearch trademark or that an inability to obtain such registration will not
have an adverse effect on the ability of such licensor or the Company to
utilize such mark in the future. The Company licenses the trademark
"Ticketmaster" and related trademarks from Ticketmaster Corp. pursuant to the
Ticketmaster License Agreement. The Company may be subject to legal
proceedings and claims of alleged infringement of the trademarks and other
intellectual property rights of third parties by the Company and its
licensees. Such claims, even if not meritorious, could result in the
expenditure of significant financial and managerial resources which could
result in a material adverse effect on the Company's business, financial
condition and results of

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<PAGE>

operations licensed to Ticketmaster Corp. The Company is dependent upon
Ticketmaster Corp. to maintain and assert its rights to the trademarks and
defend infringement claims, if any.

RISKS ASSOCIATED WITH REGULATORY MATTERS

The Company is subject to regulations applicable to businesses generally and
laws or regulations directly applicable to access to online commerce. Although
there are currently few laws and regulations directly applicable to the
Internet and commercial online services, it is possible that a number of laws
and regulations may be adopted with respect to the Internet or commercial
online services covering issues such as user privacy, pricing, content,
taxation, copyrights, distribution, antitrust and characteristics and quality
of products and services. Furthermore, the growth and development of the
market for online commerce may prompt calls for more stringent consumer
protection laws that may impose additional burdens on those companies
conducting business online. The adoption of any additional laws or regulations
may decrease the growth of the Internet or commercial online services, which
could, in turn, decrease the demand for the Company's products and services
and increase the Company's cost of doing business, or otherwise have a
material adverse effect on the Company's business, financial condition and
results of operations. Moreover, the applicability to the Internet and
commercial online services of existing laws in various jurisdictions governing
issues such as property ownership, sales and other taxes, libel and personal
privacy is uncertain and may take years to resolve. For example, tax
authorities in a number of states are currently reviewing the appropriate tax
treatment of companies engaged in online commerce, and new state tax
regulations may subject the Company to additional state sales and income
taxes. Any such new legislation or regulation, the application of laws and
regulations from jurisdictions whose laws do not currently apply to the
Company's business, or the application of existing laws and regulations to the
Internet and commercial online services could have a material adverse effect
on the Company's business, financial condition and results of operations.

Ticketmaster Online is regulated by certain state and local regulations,
including, but not limited to, a law in Georgia that establishes maximum
convenience charges on tickets for certain sporting events. Other legislation
that could affect the way Ticketmaster Online does business, including bills
that would regulate the amount of convenience charges and handling charges,
are introduced from time to time in federal, state and local legislative
bodies. The Company is unable to predict whether any such bills will be
adopted and, if so, whether such legislation would have a material effect on
the business, financial condition and results of operations of the Company.

POTENTIAL GOVERNMENTAL INVESTIGATIONS AND LITIGATION

From time to time, federal, state and local authorities have conducted
investigations or inquiries with respect to Ticketmaster Corp.'s compliance
with antitrust, unfair business practice and other laws. The most recent
federal investigation was commenced in 1994 by the Antitrust Division of the
Department of Justice and was concluded in 1995 with no enforcement action
being taken against Ticketmaster Corp.

In addition, in 1994, Ticketmaster Corp. was named as a defendant in
multiple class action lawsuits by ticket purchasers alleging that Ticketmaster
Corp.'s activities violated federal antitrust laws. All of such federal
lawsuits were consolidated by the Judicial Panel on Multidistrict Litigation
for Pretrial Proceedings. After an amended and consolidated complaint was
filed by the plaintiffs, Ticketmaster Corp. filed a motion to dismiss and, on
May 31, 1996, the United States District Court for the Eastern District of
Missouri granted the motion to dismiss for failure to state a claim upon which
relief could be granted. On June 12, 1996, the plaintiffs appealed the
dismissal, and on April 10, 1998, the Court of Appeals issued an opinion
affirming the district court's ruling that the plaintiffs were not entitled to
pursue their claims for damages under the federal antitrust laws. However, the
Court of Appeals also held that the plaintiffs' status as indirect purchasers
of Ticketmaster Corp.'s services did not bar them from seeking injunctive
relief. Discovery on the plaintiffs' claim for equitable relief is ongoing in
the United States District Court in the Eastern District of Missouri and a
trial date of July 17, 2000 has been set. On July 9, 1998, the plaintiffs
filed a petition for writ of certiorari in the United States Supreme Court
seeking review of the decision dismissing their claims. On October 5, 1998,
the Supreme Court invited the Solicitor General of the United States to file a
brief expressing the views of the United States in this case.

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Accordingly, there can be no assurance that this lawsuit, if determined
adversely against Ticketmaster Corp., will not have a material adverse effect
on the business, financial condition or results of operations of Ticketmaster
Online or the Company.

In March 1995, MovieFone, Inc. ("MovieFone") and The Teleticketing Company,
L.P. filed a complaint against Ticketmaster Corp. in the United States
District Court for the Southern District of New York. Plaintiffs allege that
they are in the business of providing movie information and teleticketing
services, and that they are parties to a contract with Pacer Cats Corporation,
a wholly owned subsidiary of Wembley plc ("Pacer Cats"), to provide
teleticketing services to movie theaters. Plaintiffs also allege that,
together with Pacer Cats, they had planned to commence selling tickets to live
entertainment events, and that Ticketmaster Corp., by its conduct, frustrated
and prevented plaintiffs' ability to do so. Plaintiffs further allege that
Ticketmaster Corp. has interfered with and caused Pacer Cats to breach its
contract with plaintiffs. The complaint asserts that Ticketmaster Corp.'s
actions violate Section 7 of the Clayton Act and Sections 1 and 2 of the
Sherman Act, and that Ticketmaster Corp. tortiously interfered with
contractual and prospective business relationships and seeks monetary and
injunctive relief based on such allegations. Ticketmaster Corp. filed a motion
to dismiss. The court heard oral argument on September 26, 1995. In March,
1997, prior to the rendering of any decision by the Court on Ticketmaster
Corp.'s motion to dismiss, Ticketmaster Corp. received an amended complaint in
which the plaintiffs assert essentially the same claims as in the prior
complaint but have added a RICO claim and tort claims. Ticketmaster Corp.
filed a motion to dismiss the amended complaint in April, 1997. Certain of the
claims in this litigation are similar to claims that were the subject of an
arbitration award in which MovieFone was a claimant and Pacer Cats a
respondent. The arbitration award in that proceeding included findings
regarding Ticketmaster Corp. and certain of its affiliates, including a former
joint venture with Wembley which is now wholly owned by Ticketmaster Corp.,
which findings may be applicable to the New York litigation. Among other
things, the award included an injunction against certain entities, which may
include certain affiliates of Ticketmaster Corp., restricting or prohibiting
their activity with respect to certain aspects of the movie teleticketing
business for a specified period of time. Neither the Company, Ticketmaster
Corp., nor any entity owned or controlled by Ticketmaster Corp., were parties
to the arbitration. Both of these proceedings are ongoing and there can be no
assurances that these matters, if determined adversely to Ticketmaster Corp.,
will not have a material adverse effect on the Company, its business,
financial condition or results of operations.

On November 2, 1998, N2K, Inc. ("N2K") formally notified Ticketmaster Corp.
that it did not intend to honor its contract with Ticketmaster Ticketing Co.,
Inc., a subsidiary of Ticketmaster Corp. ("TM Ticketing"), and defaulted on a
$3 million payment due under such contract on November 1, 1998. Such contract
related, in part, to development of a co-branded online music store available
to users of the Ticketmaster Online and N2K Music Boulevard Web sites. On
November 4, 1998, TM Ticketing filed a complaint against N2K in Los Angeles
Superior Court alleging that N2K had unlawfully breached its contract with TM
Ticketing. The complaint seeks monetary and injunctive relief.

There can be no assurance that the Company, Ticketmaster Online or
Ticketmaster Corp. or its affiliates will not become the subject of future
governmental investigations or inquiries or named as a defendant in claims
alleging violations of federal or state antitrust laws or any other laws. Any
adverse outcome in such litigation, investigation or proceeding against the
Company, Ticketmaster Online or Ticketmaster Corp. or its affiliates could
limit or prevent Ticketmaster Online from engaging in its online ticketing
business or subject the Company to potential damage assessments, all of which
could have a material adverse effect on the Company's business, financial
condition or results of operations. Regardless of its merit, source or
outcome, any such litigation, investigation or proceeding would at a minimum
be costly and could divert the efforts of the Company's management and other
personnel from productive tasks, which could have a material adverse effect on
the Company's business, financial condition or results of operations.

RISKS ASSOCIATED WITH POTENTIAL ACQUISITIONS

As part of its business strategy, the Company may make acquisitions of, or
significant investments in, complementary companies, products or technologies.
Any such future acquisitions would be accompanied by the

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risks commonly encountered in acquisitions of companies. Such risks include,
among other things, the difficulty of assimilating the operations and
personnel of the acquired companies, the potential disruption of the Company's
ongoing business, the diversion of resources from the Company's existing
businesses, sites and technologies, the inability of management to maximize
the financial and strategic position of the Company through the successful
incorporation of the acquired technology into the Company's products and
services, additional expense associated with amortization of acquired
intangible assets, the maintenance of uniform standards, controls, procedures
and policies and the impairment of relationships with employees and customers
as a result of any integration of new management personnel. There can be no
assurance that the Company would be successful in overcoming these risks or
any other problems encountered with such acquisitions, and the Company's
inability to overcome such risks could have a material adverse effect on its
business, financial condition and results of operations.

RISKS ASSOCIATED WITH DOMAIN NAMES

The Company currently holds and licenses various Web domain names relating
to its brand, including the "citysearch.com" and "ticketmaster.com" domain
names. The acquisition and maintenance of domain names generally is regulated
by governmental agencies and their designees. For example, in the United
States, the National Science Foundation has appointed Network Solutions, Inc.
as the exclusive registrar for the ".com," ".net" and ".org" generic top-level
domains. The regulation of domain names in the United States and in foreign
countries is subject to change. Governing bodies may establish additional top-
level domains, appoint additional domain name registrars or modify the
requirements for holding domain names. As a result, there can be no assurance
that the Company will be able to acquire or maintain relevant domain names in
all countries in which it conducts business. Furthermore, the relationship
between regulations governing domain names and laws protecting trademarks and
similar proprietary rights is unclear. The Company, therefore, may be unable
to prevent third parties from acquiring domain names that are similar to,
infringe upon or otherwise decrease the value of its trademarks and other
proprietary rights. Any such inability could have a material adverse effect on
the Company's business, financial condition and results of operations.

LACK OF PRIOR PUBLIC MARKET AND POSSIBLE VOLATILITY OF STOCK PRICE

Prior to this offering, there has been no public market for the Company's
Class B Common Stock, and there can be no assurance that an active trading
market will develop or be sustained. The initial public offering price for the
Class B Common Stock to be sold by the Company will be established by
negotiations among the Company and the representatives of the Underwriters and
may bear no relationship to the price at which the Class B Common Stock will
trade after completion of this offering. See "Underwriting" for factors to be
considered in determining such offering price. The market price of the Class B
Common Stock could be subject to significant fluctuations in response to
quarter-to-quarter variations in the Company's operating results,
announcements of technological innovations or new products by the Company or
its competitors, and other events or factors. For example, a shortfall in
revenues or net income, or an increase in losses from levels expected by
securities analysts, could have an immediate and significant adverse effect on
the market price of the Company's Class B Common Stock. In addition, the stock
market in recent years has experienced extreme price and volume fluctuations
that have often dramatically affected the market prices of many high
technology companies, particularly those companies doing business on the
Internet. These fluctuations have often been unrelated or disproportionate to
the operating performance of the companies. Such fluctuations, as well as
general economic and market conditions, may adversely affect the market price
for the Class B Common Stock.

BENEFITS OF THE OFFERING TO EXISTING STOCKHOLDERS

This offering will provide substantial benefits to current stockholders of
the Company. Consummation of this offering is expected to create a public
market for the Class B Common Stock issuable upon conversion of the Class A
Common Stock held by current stockholders, including executive officers and
directors of the Company. As of September 30, 1998, existing stockholders paid
$359.3 million of aggregate consideration for

32
<PAGE>

an aggregate of 62,486,478 shares of Class B Common Stock issuable upon
conversion of the Class A Common Stock. Based upon an assumed initial public
offering price of $9.00 per share, the value of the shares held by such
existing stockholders would be approximately $562.4 million. Therefore, the
aggregate unrealized gain to existing stockholders of the Company resulting
from the offering would be approximately $203.1 million. See "Principal
Stockholders" and "Shares Eligible for Future Sale."

ANTITAKEOVER EFFECT OF CERTAIN CHARTER PROVISIONS

Certain provisions of the Company's Restated Certificate of Incorporation
and the Restated Bylaws and Delaware General Corporation Law (the "DGCL")
Section 203 may render more difficult, or have the effect of discouraging,
unsolicited takeover bids from third parties or the removal of incumbent
management of the Company. These provisions include the right of the holders
of the Class A Common Stock to 15 votes per share, versus one vote per share
for the holders of Class B Common Stock and provide that the stockholders may
not call special meetings. In addition, upon completion of this offering, the
Company's Restated Certificate of Incorporation will authorize the Board of
Directors to issue, without stockholder approval, 2,000,000 shares of
preferred stock, par value $.01 per share ("Preferred Stock"), with voting,
conversion and other rights and preferences that could adversely affect the
voting power or other rights of the holders of Common Stock of the Company.
Although the Company has no current plans to issue any shares of Preferred
Stock, the issuance of Preferred Stock or rights to purchase Preferred Stock
could render more difficult, or have the effect of discouraging, unsolicited
takeover bids from third parties or the removal of incumbent management of the
Company, or otherwise adversely affect the market price for the Class B Common
Stock. See "Description of Capital Stock--Preferred Stock", "--Antitakeover
Effects of Provisions of Certificate of Incorporation and Bylaws" and "--
Effect of Delaware Antitakeover Statute." Although such provisions do not have
a substantial practical significance to investors while USAi, through its
ownership of Class A Common Stock, is in a position to effectively control all
matters affecting the Company, such provisions could have the effect of
depriving stockholders of an opportunity to sell their shares at a premium
over prevailing market prices should USAi no longer be in such control.

SHARES ELIGIBLE FOR FUTURE SALE

Sales of substantial amounts of Class B Common Stock in the public market
after this offering (including by optional or automatic conversion of shares
of Class A Common Stock into Class B Common Stock), or the anticipation of
such sales, could have a material adverse effect on then-prevailing market
prices. Upon completion of the offering, the Company will have 7,000,000
shares of Class B Common Stock outstanding and 62,486,478 shares of Class A
Common Stock outstanding (based on shares outstanding as of September 30, 1998
and assuming no exercise of currently outstanding options or warrants). Prior
to this offering, USAi will beneficially own approximately 67.9% of the
outstanding Common Stock. Shares of Class A Common Stock are convertible into
Class B Common Stock on a share-for-share basis at the election of the holder
or automatically upon certain transfers thereof. The 7,000,000 shares of Class
B Common Stock sold in this offering (plus any additional shares sold upon
exercise of the Underwriters' over-allotment option) will be freely
transferable without restriction under the Securities Act of 1933, as amended
(the "Securities Act"), unless they are held by "affiliates" of the Company as
that term is used under the Securities Act and the regulations promulgated
thereunder ("Affiliates"). The remaining 62,486,478 shares of Class B Common
Stock issuable upon conversion of the Class A Common Stock (including the
shares of Class B Common Stock issuable upon certain transfers of the Class A
Common Stock or at the option of the holder thereof) held by existing
stockholders are "restricted securities" as that term is defined in Rule 144
of the Securities Act (the "Restricted Shares"). Restricted Shares may be sold
in the public market only if registered or if they qualify for an exemption
from registration under Rule 144 or Rule 701 under the Securities Act. As a
result of contractual restrictions and the provisions of Rules 144 and 701,
additional shares will be available for sale in the public market as follows:
(i) approximately 1,253,002 Restricted Shares will be eligible for immediate
sale on the effective date of this offering; (ii) approximately 5,200
Restricted Shares will be eligible for sale 90 days after the date of this
offering; (iii) approximately 7,138,773 Restricted Shares will be eligible for
sale without restriction and

33
<PAGE>

13,229,425 Restricted Shares will be eligible for sale subject to volume
limitations, in each case 180 days after the effective date of this offering
upon the expiration of contractual lock-up agreements with the Company and the
representatives of the Underwriters and (iv) the remainder of the Restricted
Shares will be eligible for sale from time to time thereafter upon expiration
of their respective holding periods under Rule 144. In addition,
shares of Class B Common Stock issuable upon conversion of Class A Common
Stock will be issuable upon exercise of vested stock options and eligible for
sale 180 days after the date of this offering upon the expiration of
contractual lock-up agreements. NationsBanc Montgomery Securities LLC, on
behalf of the Underwriters, may, in its sole discretion and at any time
without notice, release all or any portion of securities subject to the lock-
up agreement with the Underwriters.

Upon consummation of this offering, the holders of 7,006,671 shares of Class
A Common Stock will have the right in certain circumstances to request the
Company to register their shares under the Securities Act for resale to the
public in the event of a Company-initiated registration. These registration
rights are subject to certain conditions and limitations, among them the right
of the underwriters of an offering to limit the number of shares included in
such registration. If the Company were required to include in a Company-
initiated registration shares held by such holders, such sales may have a
material adverse effect on the market price for the Company's Class B Common
Stock and on the Company's ability to raise new capital. In addition, the
Company expects to file a registration statement on Form S-8 registering a
total of approximately 3,890,694 shares of Class A Common Stock subject to
outstanding stock options under the Company's 1996 Stock Plan as of September
30, 1998 and the approximately shares of Class B Common Stock reserved
for issuance under the Company's 1998 Stock Plan and the Purchase Plan. The
Form S-8 registration statement is expected to be filed and to become
effective immediately following the effective date of this offering. Shares
registered under such registration statement will be available for sale in the
open market, subject to Rule 144 volume limitations applicable to Affiliates,
unless such shares are subject to vesting restrictions with the Company or the
lock-up agreements described above. See "Description of Capital Stock--
Registration Rights" and "Shares Eligible for Future Sale."

DILUTION

The initial public offering price is substantially higher than the book
value per share of all of the outstanding classes of Common Stock. At an
assumed initial public offering price of $9.00 per share, investors purchasing
shares of Class B Common Stock in the offering will incur immediate,
substantial dilution in the amount of $8.13 per share. In addition, investors
purchasing shares of Class B Common Stock in this offering will incur
additional dilution to the extent outstanding options and warrants are
exercised. See "Dilution."

34
<PAGE>

USE OF PROCEEDS

The net proceeds to the Company from the sale of 7,000,000 shares of Class B
Common Stock offered hereby are estimated to be $63,000,000 million
($72,450,000 million if the over-allotment option is exercised in full) at an
assumed initial public offering price of $9.00 per share and after deducting
the underwriting discount and estimated offering expenses payable by the
Company. The Company intends to use the net proceeds of this offering, up to
approximately $51 million, to repay the Convertible Note and accrued interest
thereon. The Convertible Note was issued to USAi upon execution of the Merger
Agreement in exchange for a $50 million loan from USAi to provide working
capital to the Company. The Convertible Note bears interest at a rate of 7.00%
per annum and is generally due and payable on the earlier to occur of (i)
August 13, 2005 or (ii) 20 days following the closing of an initial public
offering meeting certain criteria. See "Ticketmaster Online-CitySearch
Merger--Convertible Note." To the extent there are net proceeds in excess of
approximately $51 million, such proceeds are expected to be used for working
capital and other general corporate purposes. A portion of any remaining
proceeds also may be used to acquire or invest in complementary businesses,
technologies or service offerings. In the ordinary course of business, the
Company evaluates potential acquisitions of such businesses, technologies or
service offerings. However, the Company has no present understandings,
commitments or agreements with respect to any such acquisition, and the
Company is not currently engaged in any negotiations with respect to any such
transaction. Pending use of the net proceeds for the above purposes, the
Company intends to invest such funds in short-term, interest-bearing,
investment-grade securities.

DIVIDEND POLICY

The Company has never declared or paid any cash dividends on its capital
stock. The Company currently anticipates that it will retain any future
earnings for use in its business and does not anticipate paying any cash
dividends for the foreseeable future.

35
<PAGE>

CAPITALIZATION

The following table sets forth the capitalization of the Company as of
September 30, 1998 (i) on an actual basis, and (ii) on a pro forma as-adjusted
basis to reflect the purchase by USAi of 1,997,502 shares of Class A Common
Stock from existing stockholders at $8.67 per share pursuant to the Tender
Offer and the receipt of the net proceeds from the sale of the 7,000,000
shares of Class B Common Stock offered hereby at an assumed initial public
offering price of $9.00 per share (after deducting the underwriting discount
and estimated offering expenses payable by the Company) and the application of
the estimated net proceeds therefrom.

<TABLE>
<CAPTION>
SEPTEMBER 30, 1998
-----------------------
PRO FORMA
ACTUAL AS ADJUSTED(2)
-------- --------------
(IN THOUSANDS)
<S> <C> <C>
Long-term obligations, less current portion(1)......... $ 52,320 $ 2,320
Stockholders' equity:
Class A Common Stock, $0.01 par value; 100,000,000
shares authorized, actual and pro forma as adjusted;
62,486,478 shares issued and outstanding, actual and
pro forma as adjusted............................... 625 645
Class B Common Stock, $0.01 par value; 250,000,000
shares authorized, actual and pro forma as adjusted;
no shares issued and outstanding,
actual; 7,000,000 shares issued and outstanding, pro
forma as adjusted................................... --
Class C Common Stock, $0.01 par value; 2,883,506
shares authorized, actual and pro forma as adjusted;
no shares issued and outstanding, actual and pro
forma as adjusted................................... -- --
Additional paid-in capital............................. 295,453 352,553
Retained earnings...................................... 3,875 3,875
-------- --------
Total stockholders' equity(3).......................... 299,953 357,143
-------- --------
Total capitalization............................... $352,273 $359,463
======== ========
</TABLE>
- --------

(1) See Notes 8 and 9 of Notes to Financial Statements of Ticketmaster Online.

(2) Based on shares outstanding as of September 30, 1998. Does not include (i)
3,890,694 shares of Class A Common Stock issuable upon exercise of options
outstanding at September 30, 1998 at a weighted average price of $3.66 per
share under the 1996 Stock Plan, (ii) an aggregate of shares of
Class B Common Stock available for future grant or issuance as of the date
of this Prospectus under the 1998 Stock Plan and the Purchase Plan and
(iii) 93,107 shares of Class A Common Stock issuable upon exercise of an
outstanding warrant at an exercise price of $8.86 per share held by
NationsBanc Montgomery Securities LLC. See "Management--Employee Benefit
Plans," "Underwriting" and Note 7 of Notes to Financial Statements of
Ticketmaster Online.

(3) Actual stockholders' equity includes a preliminary allocation of $298.3
million of goodwill resulting from the Merger and the Ticketmaster
Transaction and pro forma as adjusted stockholders' equity includes an
additional $17.2 million of goodwill resulting from the Tender Offer.

36
<PAGE>

DILUTION

The net tangible book value of the Company as of September 30, 1998 was $2.9
million, or $0.05 per share of Common Stock. "Net tangible book value per
share" is determined by dividing the number of outstanding shares of Common
Stock into the net tangible book value of the Company (total tangible assets
less total liabilities). After giving effect to the application of the
estimated net proceeds from the sale by the Company of the 7,000,000 shares of
Class B Common Stock offered hereby (based upon an assumed initial public
offering price of $9.00 per share and after deducting the underwriting
discount and estimated offering expenses payable by the Company), the net
tangible book value of the Company as of September 30, 1998 would have been
$60.1 million, or $0.87 per share. This represents an immediate increase in
net tangible book value of $0.82 per share to existing stockholders and an
immediate dilution of $8.13 per share to new investors purchasing shares at
the initial public offering price. The following table illustrates the per
share dilution:

<TABLE>
<S> <C> <C>
Assumed initial public offering price.............................. $9.00
Net tangible book value as of September 30, 1998................. $0.05
Increase in net tangible book value attributable to new
investors....................................................... 0.82
-----
Net tangible book value per share after the offering............... 0.87
-----
Dilution per share to new investors................................ $8.13
=====
</TABLE>

The following table summarizes as of September 30, 1998, the number of
shares of Common Stock purchased from the Company, the total consideration
paid to the Company and the average price per share paid by the existing
stockholders and by the investors purchasing shares of Class B Common Stock in
this offering, based upon an assumed initial public offering price of $9.00
per share (before deducting the underwriting discount and estimated offering
expenses payable by the Company):

<TABLE>
<CAPTION>
SHARES PURCHASED TOTAL CONSIDERATION AVERAGE
------------------ -------------------- PRICE
NUMBER PERCENT AMOUNT PERCENT PER SHARE
---------- ------- ------------ ------- ---------
<S> <C> <C> <C> <C> <C>
Existing stockholders(1).. 62,486,478 89.9% $359,280,107 85.1% $5.75
New investors(1).......... 7,000,000 10.1 63,000,000 14.9 9.00
---------- ----- ------------ -----
Total................... 69,486,478 100.0% $422,280,107 100.0%
========== ===== ============ =====
</TABLE>
- --------

(1) If the Underwriters' over-allotment is exercised in full, the number of
shares held by new investors will be increased to 8,050,000, or 11.4% of
the total shares of all classes of Common Stock to be outstanding after
this offering.

The foregoing computations assume no exercise of any outstanding stock
options or warrants. As of September 30, 1998, there were options outstanding
to purchase a total of 3,890,694 shares of Class A Common Stock at a weighted
average exercise price of $3.66 per share and warrants outstanding to purchase
a total of 93,107 shares of Class A Common Stock at an exercise price of $8.86
per share. In addition, as of the date of this Prospectus, an aggregate of
shares of Class B Common Stock were reserved for future issuance under
the 1998 Stock Plan and the Purchase Plan. To the extent that any shares
available for issuance upon exercise of outstanding stock options or warrants
or reserved for future issuance under the 1996 Stock Plan, the 1998 Stock Plan
or the Purchase Plan are issued, there will be future dilution to new
investors. See "Management--Employee Benefit Plans," "Underwriting" and Note 6
of Notes to Financial Statements of Ticketmaster Online.

37
<PAGE>

SELECTED HISTORICAL FINANCIAL DATA

CITYSEARCH

The selected consolidated financial data presented below for the period from
September 20, 1995 (date of formation) through December 31, 1995 and for, and
as of the end of, each of the years in the two-year period ended December 31,
1997, are derived from the Consolidated Financial Statements of CitySearch,
Inc., which consolidated financial statements have been audited by Ernst &
Young LLP, independent auditors, and are included elsewhere in this
Prospectus. The consolidated balance sheet data as of December 31, 1995 are
derived from audited Consolidated Financial Statements of CitySearch, Inc.
that are not included herein. The consolidated statements of operations data
for the nine-month periods ended September 30, 1997 and September 28, 1998,
respectively, and the consolidated balance sheet data at September 28, 1998
are derived from unaudited consolidated financial statements included
elsewhere in this Prospectus. In the opinion of management, the unaudited
consolidated financial statements have been prepared on the same basis as the
audited consolidated financial statements and contain all adjustments,
consisting only of normal recurring adjustments, necessary for a fair
presentation of CitySearch's results of operations for such periods and
financial condition at such date. The results of operations for the nine
months ended September 28, 1998 are not necessarily indicative of the results
to be expected for the full year or future periods. The selected consolidated
financial data set forth below are qualified in their entirety by, and should
be read in conjunction with, "Management's Discussion and Analysis of
Financial Condition and Results of Operations" and the Consolidated Financial
Statements of CitySearch, Inc. and Notes thereto included elsewhere in this
Prospectus.

<TABLE>
<CAPTION>
PERIOD FROM
SEPTEMBER 20, YEAR ENDED
1995 (DATE OF DECEMBER 31, NINE MONTHS ENDED
FORMATION) TO ------------------ --------------------
DECEMBER 31, SEPT. 30, SEPT. 28,
1995 1996 1997 1997 1998(1)
------------- -------- -------- --------- ---------
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C> <C> <C>
CONSOLIDATED STATEMENTS
OF OPERATIONS DATA:
Revenues:
Subscription and
services............. $ -- $ 203 $ 4,913 $ 2,986 $ 9,458
Licensing and royalty. -- -- 1,271 677 1,859
------ -------- -------- -------- --------
Total revenues....... -- 203 6,184 3,663 11,317
Costs and expenses:
Cost of revenues...... -- 2,908 9,688 7,612 10,491
Sales and marketing... 57 6,369 20,172 13,716 14,902
Research and
development.......... 152 2,563 7,182 4,949 5,000
General and
administrative....... 104 2,475 5,883 4,263 5,104
Merger and other
transactions costs... -- -- -- -- 3,101
------ -------- -------- -------- --------
Total costs and
expenses............ 313 14,315 42,925 30,540 38,598
------ -------- -------- -------- --------
Loss from operations... (313) (14,112) (36,741) (26,877) (27,281)
Interest income, net... 5 217 223 104 227
------ -------- -------- -------- --------
Loss before provision
for income taxes...... (308) (13,895) (36,518) (26,773) (27,054)
Provision for income
taxes................. -- 2 8 -- --
------ -------- -------- -------- --------
Net loss............... $ (308) $(13,897) $(36,526) $(26,773) $(27,054)
====== ======== ======== ======== ========
Historical basic and
diluted net loss per
share(2).............. $(0.04) $ (1.58) $ (3.86) $ (2.84) $ (2.73)
====== ======== ======== ======== ========
Pro forma basic and
diluted net loss per
share(2).............. $ (1.96) $ (1.51) $ (1.10)
======== ======== ========
Shares used to compute
historical basic and
diluted net loss per
share(2).............. 7,895 8,786 9,452 9,431 9,923
====== ======== ======== ======== ========
Shares used to compute
pro forma basic and
diluted net loss per
share(2).............. 18,660 17,764 24,547
======== ======== ========
</TABLE>

38
<PAGE>

<TABLE>
<CAPTION>
DECEMBER 31,
------------------------- SEPT. 28,
1995 1996 1997 1998(1)
------ -------- -------- ---------
(IN THOUSANDS)
<S> <C> <C> <C> <C>
CONSOLIDATED BALANCE SHEET DATA:
Cash and cash equivalents................ $1,413 $ 7,527 $ 25,227 $57,877
Working capital.......................... 1,323 4,257 19,375 50,940
Total assets............................. 1,490 13,370 31,655 65,209
Long-term obligations, less current
portion................................. -- 1,451 2,420 52,320
Redeemable Convertible Preferred Stock... -- 20,309 70,882 --
Stockholders' equity (deficit)........... 8,366 (11,943) (47,911) 3,837
</TABLE>
- --------
(1) The historical financial data of CitySearch is presented through the
effective date of the Merger (September 28, 1998). References throughout
this Prospectus to the nine months ended September 28, 1998 refer to the
period from January 1, 1998 through September 28, 1998.

(2) Shares used to compute pro forma basic and diluted net loss per share give
effect to the conversion of outstanding CitySearch Convertible Preferred
Stock as if converted at the earlier of the beginning of the period or
issue date. See Note 1 of Notes to Consolidated Financial Statements of
CitySearch, Inc. for an explanation of the determination of the number of
shares used to compute historical and pro forma basic and diluted net loss
per share.

39
<PAGE>

TICKETMASTER ONLINE

The selected financial data presented below at January 31, 1997 and 1998 and
for each of the three years in the period ended January 31, 1998, are derived
from the Financial Statements of Ticketmaster Online, which financial
statements have been audited by Ernst & Young LLP, independent auditors, and
are included elsewhere in this Prospectus. The balance sheet data as of
January 31, 1996 are derived from unaudited financial statements of
Ticketmaster Online that are not included herein. The statements of operations
data for the eight-month periods ended September 30, 1997 and 1998 and the
balance sheet data at September 30, 1998 are derived from unaudited financial
statements included elsewhere in this Prospectus. In the opinion of
management, the unaudited financial statements have been prepared on the same
basis as the audited financial statements and contain all adjustments,
consisting only of normal recurring adjustments, necessary for a fair
presentation of Ticketmaster Online's results of operations for such periods
and financial condition at such date. The results of operations for the eight
months ended September 30, 1998 are not necessarily indicative of the results
to be expected for the full year or future periods. The selected Ticketmaster
Online financial data set forth below are qualified in their entirety by, and
should be read in conjunction with, "Management's Discussion and Analysis of
Financial Condition and Results of Operations" and the Financial Statements of
Ticketmaster Online and Notes thereto included elsewhere in this Prospectus.

<TABLE>
<CAPTION>
EIGHT MONTHS
ENDED
YEAR ENDED JANUARY 31, SEPTEMBER 30,
------------------------ --------------
1996(1) 1997(1) 1998 1997 1998(2)
------- ------- ------ ------ -------
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C> <C> <C>
STATEMENT OF OPERATIONS DATA:
Revenues:
Ticketing operations.................. $ -- $ 199 $5,972 $3,413 $9,948
Sponsorship and advertising........... 14 997 3,933 2,410 4,210
City guide and related................ -- -- -- -- 112
------ ------ ------ ------ ------
Total revenues....................... 14 1,196 9,905 5,823 14,270
Costs and expenses:
Ticketing operations.................. -- 635 3,522 2,005 5,520
City guide and related................ 97
Sales and marketing................... -- 290 490 266 772
Research and development.............. -- -- -- -- 38
General and administrative............ 548 1,260 1,719 1,075 1,280
Amortization of goodwill.............. -- -- -- -- 1,224
------ ------ ------ ------ ------
Total costs and expenses............. 548 2,185 5,731 3,346 8,931
------ ------ ------ ------ ------
Income (loss) from operations.......... (534) (989) 4,174 2,477 5,339
Interest expense, net.................. -- -- -- -- (1)
------ ------ ------ ------ ------
Income (loss) before income taxes...... (534) (989) 4,174 2,477 5,338
Income tax provision (benefit)......... (204) (374) 1,827 1,089 2,865
------ ------ ------ ------ ------
Net income (loss)...................... $ (330) $ (615) $2,347 $1,388 $2,473
====== ====== ====== ====== ======
Basic and diluted net income (loss) per
equivalent share(3)................... $(0.01) $(0.02) $ 0.06 $ 0.04 $ 0.07
====== ====== ====== ====== ======
Number of shares used to compute basic
and diluted net income (loss) per
equivalent share (3).................. 37,238 37,238 37,238 37,238 37,425
====== ====== ====== ====== ======
</TABLE>

40
<PAGE>

<TABLE>
<CAPTION>
JANUARY 31,
--------------- SEPTEMBER 30,
1996 1997 1998 1998(5)
---- ---- ----- -------------
(IN THOUSANDS)
<S> <C> <C> <C> <C>
BALANCE SHEET DATA:
Cash and cash equivalents....................... $ -- $ 3 $ -- $ 57,877
Working capital (deficit)(4).................... 223 218 (100) 49,364
Total assets(6)................................. 354 554 688 363,757
Long-term obligations, less current portion..... -- -- -- 52,320
Stockholders' equity(6)......................... 354 489 289 299,953
</TABLE>
- --------
(1) Ticketmaster Online did not incur costs or expenses until June 1995 and
commenced selling live event tickets and merchandise online in November
1996.

(2) Includes the operating results of CitySearch from September 29, 1998 to
September 30, 1998 as a result of the Merger.

(3) Basic and diluted net income (loss) per equivalent share is based on the
number of shares of CitySearch Common Stock exchanged in the Merger for
all periods presented, and for the eight months ended September 30, 1998
includes the outstanding Class A Common Stock for two days subsequent to
the Merger in the calculation of average shares.

(4) Negative working capital at January 31, 1998 is primarily the result of
accounts receivable which are included as a receivable in "Due to (from)
Ticketmaster" in stockholders' equity. See Note 1 of Notes to the
Financial Statements of Ticketmaster Online and Notes thereto included
elsewhere in this Prospectus.

(5) The balance sheet data at September 30, 1998 represents the consolidated
assets and liabilities of Ticketmaster Online and CitySearch as a result
of the Merger.

(6) Total assets and stockholders' equity at September 30, 1998 reflect a
preliminary allocation of $298.3 million of goodwill resulting from the
Merger and the Ticketmaster Transaction. Upon completion of the Tender
Offer on November 3, 1998, an additional $17.2 million of goodwill was
recorded.

41
<PAGE>

SELECTED UNAUDITED PRO FORMA COMBINED FINANCIAL DATA

The selected unaudited pro forma combined financial data give effect to the
Merger and the Ticketmaster Transaction. The Merger will be accounted for
using the "reverse purchase" method of accounting pursuant to which
Ticketmaster Online will be treated as the acquiring entity for accounting
purposes and the assets and liabilities of CitySearch will be recorded at
their respective fair values. The unaudited pro forma combined statements of
operations data assume that the Merger and Ticketmaster Transaction had
occurred at the beginning of the respective periods. The selected unaudited
pro forma combined financial data have been derived from the unaudited pro
forma condensed combined financial statements and notes thereto set forth
elsewhere herein and should be read in conjunction with those financial
statements and notes. The selected unaudited pro forma combined financial data
do not purport to be indicative of future operations and should not be
construed as representative of future operations of the combined companies.

<TABLE>
<CAPTION>
NINE MONTHS
YEAR ENDED ENDED
DECEMBER 31, SEPTEMBER 30,
1997 1998
------------ -------------
(IN THOUSANDS, EXCEPT
PER SHARE DATA)
<S> <C> <C>
PRO FORMA COMBINED STATEMENT OF OPERATIONS:
Revenues:
Ticketing operations.............................. $ 5,442 $ 10,571
Sponsorship and advertising....................... 3,965 4,915
City guide and related............................ 6,072 11,069
-------- --------
Total revenues.................................. 15,479 26,555
Costs and expenses:
Ticketing operations.............................. 3,865 7,810
City guide and related............................ 9,688 10,588
Sales and marketing............................... 20,611 15,734
Research and development.......................... 7,182 5,038
General and administrative........................ 6,993 5,998
Amortization of goodwill.......................... 57,461 43,096
Merger and other transactions costs............... -- 3,101
-------- --------
Total costs and expenses........................ 105,800 91,365
-------- --------
Loss from operations............................... (90,321) (64,810)
Interest income, net............................... 223 696
-------- --------
Loss before provision for income taxes............. (90,098) (64,114)
Provision for income taxes......................... 8 --
-------- --------
Net loss........................................... $(90,106) $(64,114)
======== ========
Basic and diluted net loss per share............... $ (1.61) $ (1.04)
Shares used to compute basic and diluted net loss
per share......................................... 55,898 61,785
</TABLE>

42
<PAGE>

MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion of the financial condition and results of
operations of the Company should be read in conjunction with the Consolidated
Financial Statements of CitySearch, Inc. and the related Notes thereto and the
Financial Statements of Ticketmaster Online and the related Notes thereto
included elsewhere in this Prospectus. This discussion contains forward-
looking statements that involve risks and uncertainties. The Company's actual
results may differ materially from those anticipated in these forward-looking
statements as a result of certain factors, including, but not limited to,
those set forth under "Risk Factors" and elsewhere in this Prospectus.

OVERVIEW

CitySearch

The Company has two primary means of providing CitySearch local city guides.
In its owned and operated markets, the Company systematically produces the
majority of its own content, hires and rapidly deploys a direct sales force to
sell custom-built Web sites as well as related services to local and regional
businesses and launches a presence in approximately six months. In other
markets, the Company partners with a local media company that contracts with
the Company to assist in developing, designing and launching a city guide.
These partners license the Company's business and technology systems and
provide royalty payments to the Company for revenues derived from operations.
In partner-led markets, the Company's partners hire and train the local city
guide staff and purchase all necessary third-party hardware and software. The
Company's current owned and operated sites are Austin, Nashville, New York
City, Portland, Raleigh-Durham-Chapel Hill, Salt Lake City/Utah and the San
Francisco Bay Area, and current partner-led markets include Baltimore, Dallas,
Los Angeles, Washington D.C., Melbourne, Stockholm, Sydney and Toronto. The
Company has also deployed roll-out teams in the San Diego and Copenhagen
partner-led markets.

In its owned and operated city guide markets, the Company derives its
revenues primarily from subscription fees resulting from the creation, hosting
and maintenance of local business Web sites. Business customers typically
enter into one-year agreements that automatically convert to month to month
contracts upon expiration. The Company recognizes revenue from sales of local
business Web sites on a monthly basis over the term of each contract as
services are rendered. The Company's city guide business customers in its
owned and operated markets increased from approximately 1,300 as of December
31, 1996 to approximately 8,500 as of September 30, 1998. As of September 30,
1998, the Company believes that there were approximately 8,400 business
customers in its partner-led markets. The average monthly revenue from new
businesses signed up in its owned and operated markets in December 1996 was
approximately $50 per customer and in September 1998 was approximately $190
per customer. To a lesser extent, the Company derives city guide revenue from
banner and sponsorship advertising purchased by national and regional
advertisers and from barter agreements with television, radio and media
alliances. Banner revenue is recognized as earned. With barter agreements, the
Company receives television and radio broadcast advertising in exchange for
Web site design, hosting and maintenance. Barter revenue and expense are
recognized monthly over the term of each contract. For each barter

43
<PAGE>

agreement, revenue and expense are equal and are recognized at a rate based on
the estimated cost of the specific services provided by the Company.

In partner-led markets, the Company derives licensing and royalty revenues
from the licensing of the Company's technology and business systems,
consulting services and from providing back office and hosting services.
Royalty, consulting and technology customization revenues have not been
significant to date, but are expected to increase as a percentage of revenues
as partner-led markets mature and as more partner-led market sites are
launched. Licensing revenue under license agreements entered into prior to
December 31, 1997 is recognized upon the completion and installation of the
Company's business and technology systems and training of partner personnel in
each partner-led market. Pursuant to Statement of Position ("SOP") No. 97-2
and beginning with contracts signed in 1998, the Company is recognizing
revenues from the sale of licenses for use of the Company's business and
technology systems over the term of the license agreement or the period over
which the relevant services are delivered. See Note 1 of Notes to Consolidated
Financial Statements of CitySearch, Inc. Royalty revenue is recognized as
earned and is typically a percentage of partner-led market revenues from Web
site subscriptions, banners, advertisements, sponsorships, and other ancillary
offerings. In the second quarter of 1998, the Company began to derive revenue
from providing back office services, including business Web site design,
hosting, customer service and billing, to certain of its partners.

Ticketmaster Online

Through Ticketmaster Online, the Company derives revenues from its online
ticketing service, from the sale of sponsorships and advertising banners on
the Ticketmaster Online Web site and from the sale of merchandise through the
Ticketmaster Online Web site. Ticket operations revenues are primarily
comprised of convenience charges that are charged on a per ticket purchased
basis and shipping and handling fees which are collected on a per order basis.
The sale of tickets for an event often begins several months prior to the
scheduled date of the event. Ticket operations revenue is recognized when the
ticket is sold. If credit card chargeback or refund activity is likely to
occur with respect to an event, for example, due to the cancellation of such
event, an allowance is established for potential convenience charge refunds.
Sponsorship and advertising revenues are primarily recognized ratably over the
term of the promotion. Merchandise sale revenues are recognized when the
products are sold. The Company expects that revenues from Ticketmaster Online
will comprise a majority of the Company's overall revenues for the foreseeable
future.

Under the Ticketmaster License Agreement, subject to certain limitations,
Ticketmaster Corp. has granted Ticketmaster Online an exclusive, perpetual,
irrevocable, worldwide license to use the Ticketmaster trademark and certain
Ticketmaster Corp. databases to sell live event tickets online for
Ticketmaster Corp.'s clients. In addition, Ticketmaster Corp. has authorized
Ticketmaster Online to be Ticketmaster Corp.'s exclusive, perpetual, worldwide
agent for such online ticket sales. The Ticketmaster License Agreement further
provides that Ticketmaster Corp. may use and permit others to use the
Ticketmaster trademark in connection with the online promotion of ticket
sales.

Ticketmaster Corp. retains the rights to sell tickets by non-online means
and to use the Ticketmaster trademark in connection with such sales. The
Ticketmaster License Agreement defines such non-online means to include by
telephone; by other voice-to-voice means or voice-to-voice recognition unit
systems; by non-interactive broadcast, cable and satellite television; and by
kiosks and retail ticket outlets. Client venues retain the rights to sell
tickets at their box offices or as otherwise provided in client venue
agreements with Ticketmaster Corp.

Ticketmaster Corp. is the contracting party with client venues, promoters
and sports franchises, providing ticket inventory management, consumer
information and related data for all ticketing transactions. Ticketmaster
Corp. provides such information to Ticketmaster Online in connection with
processing online ticket sales and provides all transaction processing and
fulfillment services for online live event ticket sales. Ticketmaster Online
is required under the Ticketmaster License Agreement to comply with the terms
of Ticketmaster Corp.'s client agreements and Ticketmaster Online's rights as
set forth in the Ticketmaster License Agreement are subordinated

44
<PAGE>

and subject to such agreements. The Ticketmaster License Agreement also
generally restricts Ticketmaster Online from cooperating with, offering online
links to, or entering into any agreements with venues, ticket sellers or sales
agents for online sale of tickets.

Under the Ticketmaster License Agreement, Ticketmaster Online pays
Ticketmaster Corp. a royalty based on the percentage of the net profit it
derives from online ticket sales. Ticketmaster Online also reimburses
Ticketmaster Corp. for Ticketmaster Corp.'s direct expenses related to online
ticket sales.

Under the Ticketmaster License Agreement, Ticketmaster Online has also been
granted the non-exclusive right to promote and sell online certain merchandise
available through Ticketmaster Corp. Ticketmaster Corp. serves as Ticketmaster
Online's exclusive fulfillment provider for the online sales of such
merchandise. As long as Ticketmaster Corp.'s fees, terms and quality of
service are no less favorable than those available to Ticketmaster Online from
third parties, Ticketmaster Corp. or its affiliates will serve as Ticketmaster
Online's exclusive fulfillment provider for the online sales of all other
merchandise available through Ticketmaster Corp. Ticketmaster Corp. may also
solicit sponsorship and advertising for Ticketmaster Online's Web sites in a
bundle with other sponsorship and advertising opportunities offered by
Ticketmaster Corp. See "Risk Factors--Dependence on Relationship with
Ticketmaster Corp." and "--Potential Conflicts of Interest."

Operating Losses

Prior to the Merger, CitySearch incurred net losses of $308,000, $13.9
million and $36.5 million for the period from September 20, 1995 (date of
formation) to December 31, 1995, and for the years ended December 31, 1996 and
1997 respectively, and $27.1 million for the nine months ended September 28,
1998. At September 28, 1998, CitySearch had an accumulated deficit of $77.8
million. The net losses and accumulated deficit resulted from CitySearch's
lack of substantial revenues and the significant operation, infrastructure and
other costs incurred in the development and initial roll outs of CitySearch's
services.

Prior to the Merger, Ticketmaster Online incurred net losses of $330,000 and
$615,000 for the years ended January 31, 1996 and 1997, respectively, and
earned net income of $2.3 million and $2.5 million for the year ended January
31, 1998 and for the eight months ended September 30, 1998, respectively. At
September 30, 1998, Ticketmaster Online had retained earnings of $3.9 million.

Goodwill

The Merger and the Tender Offer resulted in $160.2 million of goodwill that
will be amortized over three years and intangibles related to the Non-
Competition Agreements of $500,000, which is being amortized over 2.5 years.
Prior to the Merger, Ticketmaster Online was a wholly-owned subsidiary of
Ticketmaster Corp., which is a wholly-owned subsidiary of Ticketmaster Group.
Goodwill of $154.8 million, recorded by Ticketmaster Online, which is being
amortized over 40 years, represents a preliminary allocation of goodwill
resulting from the acquisition of Ticketmaster Group by USAi.

45
<PAGE>

RESULTS OF OPERATIONS

CitySearch

Revenues. CitySearch's revenues increased from $3.7 million for the nine
months ended September 30, 1997 to $11.3 million for the nine months ended
September 28, 1998, and increased from $203,000 for the year ended
December 31, 1996 to $6.2 million for the year ended December 31, 1997.
CitySearch did not recognize any revenue from September 20, 1995 (date of
formation) to December 31, 1995 (the "Inception Period"). CitySearch has two
revenue sources: (i) subscription and services revenue and (ii) licensing and
royalty revenue. Subscription and services revenue was $3.0 million and $9.5
million for the nine months ended September 30, 1997 and September 28, 1998,
respectively, and was $203,000 and $4.9 million for the years ended
December 31, 1996 and 1997 respectively. Subscription and services revenue
increased for the nine months ended September 28, 1998 as compared to the nine
months ended September 30, 1997 primarily as the result of increases in
business Web site subscription revenue of $4.2 million, due to an increase in
the average sales price of new business Web sites sold from approximately $80
in September 1997 to approximately $190 in September 1998. Subscription and
services revenue increased for the year ended December 31, 1997 as compared to
the year ended December 31,1996 primarily as the result of the increases in
business Web site subscription revenue of $3.2 million, due to the launch of
two new city guides and an increase in the average sales price of new business
Web sites sold from approximately $50 in December 1996 to approximately $100
in December 1997. The increases in subscription and services revenue for the
nine months ended September 28, 1998 and for the year ended December 31, 1997
also resulted from increases in consulting revenue of $1.7 million and
$306,000, respectively, barter revenue of $337,000 and $1.1 million,
respectively, and banner revenue of $316,000 and $113,000, respectively.
Licensing and royalty revenue was $677,000 and $1.9 million for the nine
months ended September 30, 1997 and September 28, 1998, respectively, and was
$0 and $1.3 million for the years ended December 31, 1996 and 1997,
respectively. The Company began recognizing licensing and royalty revenue
after the launch of its initial partner-led market city guide in July 1997.

Cost of Revenues. Cost of revenues consists primarily of the expenses
associated with the design, layout, photography, customer service and
editorial resources used in the production and maintenance of business Web
sites and editorial content, network infrastructure maintenance and the costs
of consulting services in partner-led markets. Cost of revenues is expended as
incurred. CitySearch had no cost of revenues for the Inception Period. Cost of
revenues were $7.6 million and $10.5 million for the nine months ended
September 30, 1997 and September 28, 1998, respectively, and were $2.9 million
and $9.7 million for the years ended December 31, 1996 and 1997, respectively.
The increases for the nine months ended September 28, 1998 as compared to the
nine months ended September 30, 1997 and for the year ended December 31, 1997
as compared to the year ended December 31, 1996 were due primarily to
increased personnel and freelance labor amounting to $2.3 million and $5.5
million, respectively, required to produce and maintain the increased number
of business Web sites and amount of editorial content. The remaining amount of
the increase during the periods was due to operating support costs associated
with the growth in the business.

Sales and Marketing Expenses. Sales and marketing expenses consist primarily
of the costs related to compensation of sales and marketing personnel,
advertising, public relations, travel, sales force training and marketing
literature. Sales and marketing expenses were $13.7 million and $14.9 million
for the nine months ended September 30, 1997 and September 28, 1998,
respectively, and were $57,000, $6.4 million and $20.2 million for the
Inception Period and for the years ended December 31, 1996 and 1997,
respectively. The increase for the nine months ended September 28, 1998 as
compared to the nine months ended September 30, 1997 was primarily due to
increased sales and marketing personnel and increased advertising expenses.
The increase for the year ended December 31, 1997 as compared to the year
ended December 31, 1996 was due primarily to increased labor related costs of
$7.6 million. The increase in the year ended December 31, 1997 was also
attributable, to a lesser extent, to an increase of $2.0 million in
advertising costs. The remaining increase in the period was related to
operating support costs associated with the growth in sales and marketing
activities. The Company expects that sales and marketing expenses will
continue to increase in absolute dollars as CitySearch expands its direct
sales force, hires additional marketing personnel and increases expenditures
for marketing and promotional activities.

46
<PAGE>

Research and Development Expenses. Research and development expenses include
the costs to develop, test and upgrade the CitySearch online service and the
enterprise management systems. These costs consist primarily of salaries for
product development personnel, contract labor expense, consulting fees,
software licenses, hardware costs and recruiting fees. Research and
development expenses were $4.9 million and $5.0 million for the nine months
ended September 30, 1997 and September 28, 1998, respectively, and were
$152,000, $2.6 million and $7.2 million for the Inception Period and for the
years ended December 31, 1996 and 1997, respectively. The increases in
research and development expenses were primarily attributable to increased
staffing levels required to design, test, deploy and support expanded city
guide functionality and back-office systems. The Company believes that timely
deployment of new and enhanced products and technology is critical to
attaining its strategic objectives and to remaining competitive. Accordingly,
the Company intends to continue recruiting and hiring experienced research and
development personnel and making other investments in research and
development. As such, the Company expects that research and development
expenditures will increase in absolute dollars in future periods. CitySearch
has expended research and development costs as incurred.

General and Administrative Expenses. General and administrative expenses
consist primarily of administrative and executive personnel costs, fees for
professional services and the costs of in-house infrastructure to support the
operations of CitySearch. General and administrative expenses were $4.3
million and $5.1 million for the nine months ended September 30, 1997 and
September 28, 1998, respectively, and were $104,000, $2.5 million and $5.9
million for the Inception Period and for the years ended December 31, 1996 and
1997, respectively. These increases were due primarily to increased staffing
levels to manage and support CitySearch's expanding operations. The Company
anticipates hiring additional personnel and incurring additional costs related
to being a publicly held entity, including directors' and officers' liability
insurance, investor relations programs and professional service fees.
Accordingly, the Company anticipates that general and administrative expenses
will continue to increase in absolute dollars.

Merger and Other Transactions Costs. CitySearch recorded $3.1 million in
costs during the nine months ended September 28, 1998, which were primarily
related to the Merger.

Interest Income, Net. Net interest income consists primarily of interest
earned on CitySearch's cash and cash equivalents, less interest expense on
capital lease obligations. CitySearch had net interest income of $104,000 and
$227,000 for the nine months ended September 30, 1997 and September 28, 1998,
respectively, and $5,000, $217,000 and $223,000 for the Inception Period and
for the years ended December 31, 1996 and 1997, respectively. Included in net
interest income during the nine months ended September 28, 1998 is interest
expense of $469,000 on the Convertible Note. CitySearch invests its cash
balances in short-term investment grade, interest-bearing securities.

Income Taxes. The provision for income, franchise and capital taxes of $800,
$1,600 and $8,330 for the Inception Period and for the years ended December
31, 1996 and December 31, 1997, respectively, is based solely on minimum state
tax requirements. CitySearch's effective tax rate differs from the statutory
federal income tax rate, primarily as a result of operating losses not
benefited. Due to the uncertainty surrounding the timing of realizing the
benefits of its favorable tax attributes in future tax returns, CitySearch has
placed a valuation allowance against its otherwise recognizable deferred tax
assets. At December 31, 1997, CitySearch had net operating loss carryforwards
for federal and state income tax purposes of approximately $47.5 million. The
federal carryforwards expire principally in the period from 2010 to 2012, and
the state carryforwards expire principally in 2003. See Note 4 of Notes to
Consolidated Financial Statements of CitySearch, Inc. The Tax Reform Act of
1986 imposes substantial restrictions on the utilization of net operating
losses and tax credits in the event of an "ownership change" of a corporation.
CitySearch's ability to utilize net operating loss carryforwards may be
limited as a result of "ownership change" as defined in the Internal Revenue
Code of 1986, as amended (the "Code"). The Merger, and prior issuances of
CitySearch Convertible Preferred Stock, have constituted "ownership changes"
that could result in limitations on the use of net operating loss
carryforwards in future periods.

Recent Accounting Pronouncement. In October 1997, the American Institute of
Certified Public Accountants issued SOP No. 97-2, Software Revenue
Recognition, which supersedes SOP No. 91-1. CitySearch

47
<PAGE>

adopted SOP No. 97-2 prospectively for software transactions entered into
beginning January 1, 1998. SOP No. 97-2 generally requires revenue earned on
software arrangements involving multiple elements to be allocated to each
element based on the relative fair values of the elements. The fair value of
an element must be based on evidence that is specific to the vendor. If a
vendor does not have evidence of the fair value for all elements in a
multiple-element arrangement, all revenue from the arrangement is deferred
until such evidence exists or until all elements are delivered. Beginning with
contracts signed in 1998 pursuant to SOP 97-2, CitySearch is recognizing
revenues from the sale of licenses for use of CitySearch's business and
technology systems over the term of the license agreement or the period over
which the relevant services are delivered. See Note 1 of Notes to Consolidated
Financial Statements of CitySearch, Inc.

Ticketmaster Online

Revenues. Ticketing operations revenues increased from $3.4 million for the
eight months ended September 30, 1997 to $9.9 million for the eight months
ended September 30, 1998, and increased from $199,000 for the fiscal year
ended January 31, 1997 to $6.0 million for the fiscal year ended January 31,
1998. Ticketmaster Online did not recognize ticketing revenue for the fiscal
year ended January 31, 1996, since significant operations commenced in
November 1996. The increase for the eight months ended September 30, 1998 as
compared to the comparable period in 1997 is primarily attributable to a
significant increase in the number of tickets sold (from 574,000 to 1,848,000
tickets), and a 6.4% increase in average ticketing operations revenue per
ticket (from $5.00 to $5.32). The increase for the fiscal year ended January
31, 1998 is primarily attributable to a significant increase in the number of
tickets sold (from 39,000 to 1,065,000 tickets), and an 11% increase in
average convenience charge revenue per ticket (from $4.56 to $5.06). The
increase in the number of tickets sold in the fiscal year ended January 31,
1998 is largely attributable to the commencement of online ticket sales
through the Ticketmaster Online Web site in November 1996.

Sponsorship and advertising revenues were $2.4 million and $4.2 million for
the eight months ended September 30, 1997 and 1998, respectively, and $14,000,
$1.0 million and $3.9 million for the fiscal years ended January 31, 1996,
1997 and 1998, respectively. The increases are primarily attributable to an
increase in sponsorship and promotion activity with strategic marketing
partners.

Ticketing Operations Expenses. Ticketing operations expenses consist
primarily of expenses associated with ticket fulfillment, Web site design and
layout, service and network infrastructure maintenance and data
communications. Ticketing operating expenses were $2.0 million and $5.5
million for the eight months ended September 30, 1997 and 1998, respectively,
and were $635,000 and $3.5 million for the fiscal years ended January 31, 1997
and 1998, respectively. Ticketmaster Online did not incur any ticketing
operations expenses during the fiscal year ended January 31, 1996, since
significant ticketing operations began in November 1996. Ticketing operations
expenses are primarily variable in nature and have increased during the
periods presented in conjunction with the increase in ticketing operations
revenue and will continue to increase in future periods to the extent
ticketing operations revenues increase during such periods. In addition, the
Company expects that ticketing operations expenses will increase as a
percentage of ticketing revenues following the Merger as a result of expenses
associated with the Ticketmaster License Agreement.

Sales and Marketing Expenses. Sales and marketing expenses consist primarily
of costs related to the compensation of sales and marketing personnel,
advertising and travel. Sales and marketing expenses were $266,000 and
$772,000 for the eight months ended September 30, 1997 and 1998, respectively,
and $290,000 and $490,000 for the fiscal years ended January 31, 1997 and
1998, respectively. The increases for the fiscal year ended January 31, 1998
and the eight months ended September 30, 1998 over corresponding periods were
due primarily to increased salary related costs and operating support costs
associated with the growth in sales and marketing activities. The Company
expects that sales and marketing expenses will increase in absolute dollars.

General and Administrative Expenses. General and administrative expenses
consist primarily of administrative and executive personnel costs. General and
administrative expenses were $1.1 million and

48
<PAGE>

$1.3 million for the eight months ended September 30, 1997 and 1998,
respectively, and were $548,000, $1.3 million and $1.7 million for the fiscal
years ended January 31, 1996, 1997, and 1998, respectively. These increases
were due primarily to increased staffing levels to manage and support
Ticketmaster Online's expanding operations. The Company expects the general
and administrative expenses will increase in absolute dollars.

Income Taxes. The provision (benefit) for income taxes was $1.1 million and
$2.9 million for the eight months ended September 30, 1997 and 1998,
respectively, and $(204,000), $(374,000), and $1.8 million for the fiscal
years ended January 31, 1996, 1997 and 1998, respectively. Ticketmaster
Online's effective tax rate differs from the statutory federal income tax
rate, primarily as a result of state income taxes. Tax benefits were recorded
in fiscal years 1996 and 1997 as there were no valuation allowances recognized
against the deferred tax asset on a stand-alone basis for the respective
years. The Company expects that any taxable income of Ticketmaster Online for
1998 and 1999 will be offset by the expected future net operating losses of
CitySearch, resulting in a nominal tax provision on a combined basis
subsequent to the Merger. However, net operating loss carryforwards of
CitySearch will not be available to further offset taxable income of
Ticketmaster Online.

49
<PAGE>

SELECTED QUARTERLY OPERATING RESULTS

The following tables set forth certain historical statement of operations
data for CitySearch and Ticketmaster Online and certain pro forma combined
Ticketmaster Online-CitySearch, Inc. statement of operations data for the
seven quarters ended September 30, 1998 (September 28, 1998 for CitySearch).
This information has been derived from unaudited historical and pro forma
financial statements. In management's opinion, the unaudited historical
information has been prepared on the same basis as the annual financial
statements of CitySearch and Ticketmaster Online and includes all adjustments
(consisting only of normal recurring adjustments) necessary for a fair
presentation for the quarters presented. This information should be read in
conjunction with the Consolidated Financial Statements of CitySearch, Inc. and
Notes thereto, the Financial Statements of Ticketmaster Online and Notes
thereto and the Unaudited Pro Forma Condensed Combined Financial Statements of
Ticketmaster Online-CitySearch, Inc. and Notes thereto included elsewhere in
this Prospectus. The operating results for any quarter are not necessarily
indicative of results for any future period.

CitySearch (Historical)

<TABLE>
<CAPTION>
THREE MONTHS ENDED
---------------------------------------------------------------------
MARCH 31, JUNE 30, SEPT. 30, DEC. 31, MARCH 31, JUNE 30, SEPT. 28,
1997 1997 1997 1997 1998 1998 1998
--------- -------- --------- -------- --------- -------- ---------
(IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C> <C>
Revenues:
Subscription and
services............. $ 470 $ 1,038 $ 1,478 $ 1,927 $ 2,563 $ 3,014 $ 3,881
Licensing and
royalty.............. -- -- 677 594 528 693 638
------- ------- ------- ------- ------- ------- --------
Total revenues...... 470 1,038 2,155 2,521 3,091 3,707 4,519
Costs and expenses:
Cost of revenues...... 1,898 2,145 2,783 2,862 3,260 3,439 3,792
Sales and marketing... 4,661 4,963 4,878 5,670 4,757 5,055 5,090
Research and
development.......... 1,713 1,507 1,729 2,233 1,655 1,740 1,605
General and
administrative....... 1,363 1,380 1,520 1,620 1,468 1,687 1,949
Merger and other
transactions costs... -- -- -- -- 100 379 2,622
------- ------- ------- ------- ------- ------- --------
Total costs and
expenses........... 9,635 9,995 10,910 12,385 11,240 12,300 15,058
------- ------- ------- ------- ------- ------- --------
Loss from operations.... (9,165) (8,957) (8,755) (9,864) (8,149) (8,593) (10,539)
Interest income
(expense), net......... 84 20 -- 119 173 87 (33)
------- ------- ------- ------- ------- ------- --------
Loss before provision
for income taxes....... (9,081) (8,937) (8,755) (9,745) (7,976) (8,506) (10,572)
Provision for income
taxes.................. -- -- -- 8 -- -- --
------- ------- ------- ------- ------- ------- --------
Net loss................ $(9,081) $(8,937) $(8,755) $(9,753) $(7,976) $(8,506) $(10,572)
======= ======= ======= ======= ======= ======= ========
</TABLE>

Subscription and services revenues increased each period primarily as the
result of business Web site subscription revenue growth due to an increased
number of city guides launched, a greater number of business Web sites in each
city guide and an increase in the average sales price for business Web sites.
Licensing and royalty revenues have fluctuated with the timing of license
agreements in partner-led markets.

Cost of revenues has increased each period as CitySearch continues to sell
new business Web sites, add editorial content, host and maintain an increasing
number of business Web sites and, to a lesser extent, provide increasing
services in partner-led markets. Sales and marketing expenses fluctuate
primarily due to the timing of advertising and promotional campaigns. During
the three months ended December 31, 1997, the increase in sales and marketing
expense was primarily due to increased advertising expenditures. Research and
development expenses fluctuate primarily due to the periodic use of technology
consultants. During the three months ended December 31, 1997, consultants were
retained to assist with the development of version CS 2.5 of CitySearch's
online city guide application. General and administrative expenses have
increased due primarily to increased staffing levels to manage and support
CitySearch's expanding operations. During the three-month periods ended
June 30, 1998 and September 28, 1998, general and administrative expenses
increased primarily due to higher professional fees incurred during the
quarters. Merger and other transactions costs increased for the three months
ended September 28, 1998 primarily due to costs relating to the Merger.

50
<PAGE>

Ticketmaster Online (Historical)

<TABLE>
<CAPTION>
THREE MONTHS ENDED
------------------------------------------------------------------
MARCH 31, JUNE 30, SEPT. 30, DEC. 31, MARCH 31, JUNE 30, SEPT. 30,
1997 1997 1997 1997 1998 1998 1998
--------- -------- --------- -------- --------- -------- ---------
(IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C> <C>
Revenues:
Ticketing operations.. $ 528 $1,665 $1,302 $1,947 $2,237 $3,710 $4,624
Sponsorship and
advertising.......... 742 959 1,012 1,140 917 1,527 2,111
City guide and
related.............. -- -- -- -- -- -- 112
------ ------ ------ ------ ------ ------ ------
Total revenues...... 1,270 2,624 2,314 3,087 3,154 5,237 6,847
Costs and expenses:
Cost of ticketing
operations........... 441 753 863 1,203 1,377 2,074 2,496
Cost of city guide and
related.............. -- -- -- -- -- -- 97
Sales and marketing... 93 85 97 164 225 245 362
Research and
development.......... -- -- -- -- -- -- 38
General and
administrative....... 396 389 439 476 515 492 460
Amortization of
goodwill............. -- -- -- -- -- -- 1,224
------ ------ ------ ------ ------ ------ ------
Total costs and
expenses........... 930 1,227 1,399 1,843 2,117 2,811 4,677
------ ------ ------ ------ ------ ------ ------
Income from operations
..................... 340 1,397 915 1,244 1,037 2,426 2,170
Interest expense, net
..................... -- -- -- -- -- -- (1)
------ ------ ------ ------ ------ ------ ------
Income before
provision for income
taxes................ 340 1,397 915 1,244 1,037 2,426 2,169
Provision for income
taxes.................. 149 612 401 545 438 1,025 1,530
------ ------ ------ ------ ------ ------ ------
Net income............ $ 191 $ 785 $ 514 $ 699 $ 599 $1,401 $ 639
====== ====== ====== ====== ====== ====== ======
</TABLE>

During the three months ended June 30, 1997, ticketing operations revenues
included approximately $450,000 of revenue earned from Web site development
and support for an affiliate of Ticketmaster Online. During the three months
ended June 30, 1998, Ticketmaster Online began to recognize revenue from an
advertising and sponsorship agreement with N2K. See "Business--Ticketmaster
Online Business--Ticketmaster Online Strategic Alliances." The three months
ended September 30, 1998 include the two days of operating results of
CitySearch subsequent to the Merger.

Ticketmaster Online-CitySearch, Inc. (Pro Forma Combined)

<TABLE>
<CAPTION>
THREE MONTHS ENDED
------------------------------------------------------------------------
MARCH 31, JUNE 30, SEPT. 30, DEC. 31, MARCH 31, JUNE 30, SEPT. 30,
1997 1997 1997 1997 1998 1998 1998
--------- -------- --------- -------- --------- -------- ---------
(IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C> <C>
Revenues:
Ticketing operations.. $ 528 $ 1,665 $ 1,302 $ 1,947 $ 2,237 $ 3,710 $ 4,624
Sponsorship and
advertising.......... 744 968 1,047 1,206 1,014 1,707 2,194
City guide and
related.............. 468 1,029 2,120 2,455 2,994 3,527 4,548
-------- -------- -------- -------- -------- -------- --------
Total revenues...... 1,740 3,662 4,469 5,608 6,245 8,944 11,366
Costs and expenses:
Cost of ticketing
operations........... 450 915 1,018 1,482 1,691 2,717 3,402
Cost of city guide and
related.............. 1,898 2,145 2,783 2,862 3,260 3,439 3,889
Sales and marketing... 4,754 5,048 4,975 5,834 4,982 5,300 5,452
Research and
development.......... 1,713 1,507 1,729 2,233 1,655 1,740 1,643
General and
administrative....... 1,611 1,622 1,812 1,948 1,776 1,972 2,250
Amortization of
goodwill............. 14,366 14,365 14,366 14,364 14,366 14,365 14,365
Merger and other
transactions costs... -- -- -- -- 100 379 2,622
-------- -------- -------- -------- -------- -------- --------
Total costs and
expenses........... 24,792 25,602 26,683 28,723 27,830 29,912 33,623
-------- -------- -------- -------- -------- -------- --------
Loss from operations.... (23,052) (21,940) (22,214) (23,115) (21,585) (20,968) (22,257)
Interest income, net.... 84 20 -- 119 173 87 436
-------- -------- -------- -------- -------- -------- --------
Loss before provision
for income taxes....... (22,968) (21,920) (22,214) (22,996) (21,412) (20,881) (21,821)
Provision for income
taxes.................. -- -- -- 8 -- -- --
-------- -------- -------- -------- -------- -------- --------
Net loss................ $(22,968) $(21,920) $(22,214) $(23,004) $(21,412) $(20,881) $(21,821)
======== ======== ======== ======== ======== ======== ========
</TABLE>

51
<PAGE>

The Company's operating results have varied on a quarterly basis during its
short operating history and may fluctuate significantly in the future as a
result of a variety of factors, many of which are outside the Company's
control. Factors that may affect the Company's quarterly operating results
include, but are not limited to, Ticketmaster Corp.'s ability to maintain and
increase the number of clients for which it provides online ticketing services
and convenience charges relating thereto, the ability of the Company's
partners to meet roll-out schedules for CitySearch city guide services, the
timing and amount of license and royalty payments from CitySearch partners,
the Company's ability to increase the volume of online ticket sales through
the Ticketmaster Online Web site, the Company's ability to retain existing
business customers, attract new business customers at a steady rate and
maintain customer satisfaction, the timing and volume of new business Web site
orders and the Company's capacity to meet such orders, the Company's ability
to maintain or increase current rates of sales productivity, the announcement
or introduction of new or enhanced sites and services by the Company or its
competitors, the amount of traffic on the Company's online sites, the amount
of expenditures for online advertising by businesses, the level of use of the
Web and online services and consumer acceptance of the Internet for services
such as those offered by the Company, the Company's ability to upgrade and
develop its systems and attract personnel in a timely and effective manner,
the amount and timing of operating costs and capital expenditures relating to
expansion of the Company's business and infrastructure, technical
difficulties, system downtime or Internet brownouts, political or economic
events affecting the cities in which the Company operates and general economic
conditions. Unfavorable changes in any of the above factors could adversely
affect the Company's revenues, gross margins and results of operations in
future periods. In addition, Ticketmaster Online derives a majority of its
revenues directly or indirectly from the sale of tickets and related
merchandise for live entertainment, sporting and leisure events and is
directly affected by the popularity, frequency and location of such events.
Factors affecting the demand for and attendance of such events include,
without limitation, general economic conditions, consumer trends and work
stoppages. Any occurrence or condition that results in decreased attendance or
demand for such entertainment, sporting and leisure events would likely have a
material adverse effect on the Company's business, financial condition and
results of operations. As a result of the foregoing, the Company believes that
period-to-period comparisons of its results of operations should not be relied
upon as an indication of future performance. In addition, the results of any
quarterly period are not indicative of results to be expected for a full
fiscal year. The foregoing factors which are largely unpredictable and may
cause significant fluctuations in operating results may cause the Company's
annual or quarterly results of operations to be below the expectations of
public market analysts or investors, in which case the market price of the
Class B Common Stock could be materially and adversely affected.

LIQUIDITY AND CAPITAL RESOURCES

CitySearch

Since its inception, CitySearch has financed its operations primarily
through the private placement of equity securities, raising $81.0 million, and
capital equipment leases. At September 28, 1998, CitySearch had $57.9 million
in cash and cash equivalents. CitySearch has had significant negative cash
flows from operating activities in each fiscal and quarterly period to date.
Net cash used in operating activities was $22.8 million and $23.4 million for
the nine months ended September 30, 1997 and September 28, 1998, respectively,
and $213,000, $10.5 million and $30.1 million for the Inception Period and for
the years ended December 31, 1996 and 1997, respectively. Cash used in
operating activities from inception through September 28, 1998 consisted
primarily of net operating losses and increases in accounts receivable, which
were partially offset by increases in deferred revenues, accrued expenses and
accounts payable. CitySearch received a $50.0 million loan from USAi upon
issuance of the Convertible Note in August 1998. See "Ticketmaster Online-
CitySearch Merger--Convertible Note."

Net cash used in investing activities was $1.4 million and $171,000 for the
nine months ended September 30, 1997 and September 28, 1998, respectively, and
was $82,000, $3.5 million and $2.0 million for the Inception Period and for
the years ended December 31, 1996 and 1997, respectively. Net cash used in
investing activities in these periods consisted primarily of capital
expenditures for computer equipment, purchased software, office equipment, and
leasehold improvements. As of December 31, 1997, the Company also had
commitments under non-cancelable operating leases of $5.3 million. Net cash
provided by financing activities was $18.0 million and

52
<PAGE>

$56.2 million for the nine months ended September 30, 1997 and September 28,
1998, respectively, and was $1.7 million, $20.2 million and $49.7 million for
the Inception Period and the years ended December 31, 1996 and 1997,
respectively, attributable to the private sale of CitySearch Convertible
Preferred Stock.

Ticketmaster Online

Prior to the Merger, Ticketmaster Online's primary sources of liquidity were
cash from operations and funding from Ticketmaster Corp. Consistent with the
cash management policies of Ticketmaster Corp., Ticketmaster Online did not
maintain any cash balances prior to the date of the Merger (September 28,
1998). Since its inception through the fiscal year ended January 31, 1997,
Ticketmaster Online had negative cash flows from operating activities.
Subsequent to these periods, net cash provided from operating activities has
been positive. Net cash provided from operating activities was $1.8 million
and $6.0 million for the eight months ended September 30, 1997 and 1998,
respectively, and $2.9 million for the fiscal year ended January 31, 1998,
while net cash used in operating activities was $538,000 and $556,000 for the
years ended January 31, 1996 and 1997, respectively. Cash provided from
operating activities for the five months ended June 30, 1998 primarily
consists of net operating income and increases in deferred revenue.

Net cash used in investing activities was $125,000 and $401,000 for the
eight-month periods ended September 30, 1997 and 1998, respectively, and was
$146,000, $189,000 and $250,000 for the fiscal years ending January 31, 1996,
1997 and 1998, respectively. Net cash used in investing activities in these
periods consisted primarily of capital expenditures for computers, software,
equipment and leasehold improvements. Net cash used in financing activities
was $1.7 million and $5.5 million for the eight months ended September 30,
1997 and 1998, respectively, and $2.7 million for the fiscal year ended
January 31, 1998 attributable to repayments to Ticketmaster Corp. for prior
financing provided to Ticketmaster Online and distributions to Ticketmaster
Corp. Net cash provided by financing activities was $684,000 and $748,000 for
the fiscal years ended January 31, 1996 and 1997, respectively, attributed to
intercompany funding from Ticketmaster Corp.

At September 30, 1998, the Company's cash and cash equivalents were $57.9
million. The Company believes that net proceeds from this offering (following
the use of approximately $51 million of the proceeds to repay the Convertible
Note), together with existing cash and cash equivalents will be sufficient to
meet its working capital and capital expenditures requirements for at least
the next 12 months. Thereafter, the Company may be required to raise
additional funds. No assurance can be given that the Company will not be
required to raise additional financing prior to such time. If additional funds
are raised through the issuance of equity securities, stockholders of the
Company may experience significant dilution. Furthermore, there can be no
assurance that additional financing will be available when needed or that if
available, such financing will include terms favorable to the Company or its
stockholders. If such financing is not available when required or is not
available on acceptable terms, the Company may be unable to develop or enhance
its products and services, take advantage of business opportunities or respond
to competitive pressures, any of which could have a material adverse effect on
the Company's business, financial condition and results of operations. See
"Risk Factors--Future Capital Needs; Uncertainty of Additional Financing."

YEAR 2000

The widespread use of computer programs that rely on two-digit dates to
perform computation and decision-making functions may cause computer systems,
including systems and software used by the Company and its Web services, to
malfunction prior to or in the Year 2000 and lead to significant business
delays and disruptions in the Company's business and operations in the United
States and internationally.The Company has developed a plan to minimize the
impact of this Year 2000 problem. Pursuant to such plan, the Company has
established a Year 2000 Committee consisting of senior managers from relevant
functional areas. The Year 2000 Committee has reviewed all areas of the
Company's business and operations that may be affected and has assigned
responsibility for each area to individuals knowledgeable about their
respective areas. The Year 2000 Committee has made these individuals
responsible for the initial assessment of risk and initial estimate of
hardware cost,

53
<PAGE>

software cost and time required to achieve compliance. The Company believes
that this initial assessment will be concluded in the fourth quarter of 1998.
The Company will immediately thereafter commence implementation of remediation
necessary to achieve compliance. Remediation will continue in 1999. The
Company estimates that the dollar cost of Year 2000 compliance is
approximately $200,000. However, the Company has not yet completed its
comprehensive assessment of remediation costs and actual costs could
materially differ.

Several systems provided by third parties are required for the operation of
the Company's services, any of which may contain software code that is not
Year 2000 compliant. These systems include server software used to operate the
Company's network servers, software controlling routers, switches and other
components of the Company's data network, disk management software used to
control the Company's data disk arrays, firewall, security, monitoring and
back-up software used by the Company, as well as desktop PC applications
software. In most cases, the Company employs widely available software
applications and other products from leading third party vendors, and expects
that such vendors will provide any required upgrades or modifications in a
timely fashion. However, any failure of third party suppliers to provide Year
2000 compliant versions of the products used by the Company could result in a
temporary disruption of the Company's services or otherwise disrupt the
Company's operations. In addition, the Company's partners may operate their
city guide sites in proximity to other applications that may not be Year 2000
compliant. While the Company intends to assign an individual to coordinate
each partner's compliance efforts to ensure uninterrupted operations, the
Company has limited ability to influence decisions by its partners. Non-
compliant systems that adjoin partners' city guide applications could result
in interruption or disruption of the city guide service, which in turn could
reduce royalties or other amounts due to the Company. There can no assurance
that the Company, its third party suppliers or its partners will be Year 2000
compliant at the end of the millenium. Failure to achieve compliance could
result in complete failure or inaccessability of the Company's or its
partners' services, and could adversely affect the Company's business,
financial condition and results of operations.

Year 2000 compliance problems could also undermine the general
infrastructure necessary to support the Company's operations. For instance,
the Company depends on third party Internet service providers for connectivity
to the Internet. Any interruption of service from the Company's Internet
service providers could result in a temporary interruption of the Company's
services. Moreover, the effects of Year 2000 compliance deficiencies on the
integrity and stability of the Internet are difficult to predict. A
significant disruption in the ability of businesses and consumers to reliably
access the Internet or portions of it would have an adverse effect on demand
for the Company's services and adversely impact the Company's business,
financial condition and results of operations.

54
<PAGE>

BUSINESS

The discussion in this Prospectus contains forward-looking statements that
involve risks and uncertainties. The Company's actual results may differ
significantly from the results discussed in the forward-looking statements.
Factors that could cause or contribute to such differences include, but are
not limited to, those discussed in "Risk Factors" and "Management's Discussion
and Analysis of Financial Condition and Results of Operations." The discussion
in the Business section also includes market projections provided by research
firms identified therein. Such information is based upon data, assumptions and
methodologies compiled and applied by such firms. There can be no assurance
that such market projections will be achieved.

OVERVIEW

The Company is combining CitySearch and Ticketmaster Online to create a
leading provider of local city guides, local advertising and live event
ticketing on the Internet. CitySearch was incorporated in September 1995 and
launched its first local city guide in May 1996. Ticketmaster Online was
formed in 1993 to administer the online business of Ticketmaster Corp. and
began selling live event tickets and related merchandise online in November
1996. Prior to the Merger, Ticketmaster Online was operated as a wholly-owned
subsidiary of Ticketmaster Corp. The Company intends to integrate its local
CitySearch city guides with its Ticketmaster Online live events ticketing and
merchandising distribution capabilities to offer online ticketing,
merchandise, electronic coupons and other transactions to a broader audience
of consumers. The CitySearch city guides provide up-to-date information
regarding arts and entertainment events, community activities, recreation,
business, shopping, professional services and news/sports/weather to consumers
in metropolitan areas. Ticketmaster Online offers consumers up-to-date
information on live entertainment events and a convenient means of purchasing
tickets and related merchandise on the Web for live events in 44 states and in
Canada and the United Kingdom. Consumers can access the Ticketmaster Online
service at www.ticketmaster.com and from CitySearch owned and operated city
guides at www.citysearch.com through numerous direct links from banners and
event profiles. Subject to certain limitations, Ticketmaster Online is the
exclusive agent for Ticketmaster Corp., a leading provider of live event
automated ticketing services in the United States, for the online sale of
tickets to live events presented by Ticketmaster Corp.'s clients.

The Company intends to utilize Ticketmaster Online's presence in certain
domestic and international cities to accelerate the expansion of different
versions of the CitySearch city guides into new local territories. The Company
plans to include selected CitySearch editorial content on the Ticketmaster
Online Web site, thereby providing additional information to assist purchasing
decisions. The Company believes that by expanding its branded network of local
city guides and continuing to offer attractive features and services, such as
live event ticketing, the Company's Web sites will increasingly attract local,
regional and national advertisers that seek to efficiently target local
consumers.

INDUSTRY BACKGROUND

The Internet and the World Wide Web

The Internet is an increasingly significant global interactive medium for
communications, content and commerce. International Data Corporation ("IDC")
estimates that the number of Web users worldwide will increase from 69 million
at the end of 1997 to 320 million by the year 2002. According to The Media
Audit, in certain of the markets where CitySearch has offerings, including
Austin, Dallas, Portland, Raleigh-Durham-Chapel Hill, Salt Lake City, San
Diego, San Francisco and Washington, D.C., more than four in ten adults are
online. Growth in Internet usage has been fueled by a number of factors,
including (i) the large and growing installed base of personal computers in
the workplace and home, (ii) advances in the performance of personal computers
and modems, (iii) improvements in network systems and infrastructure, (iv)
more readily available and lower cost access to the Internet, (v) increased
awareness of the Internet among businesses and consumers, (vi) increased
volume of information and services offered on the Web and (vii) reduced
security risks in conducting transactions online. As Internet accessibility,
usage and functionality continue to grow, the Internet is increasingly being
used as a medium for direct communication among users (e.g., via e-mail and
bulletin boards) as well as a rapidly growing sales and marketing channel.

55
<PAGE>

The Demand for Local, Community-Oriented Information and Transactions over
the Internet

The Company believes that as users spend more time on the Web, they are
increasingly seeking local information relevant to their daily lives and
sophisticated online transaction capabilities including opportunities to
purchase products and services online. The Company believes that consumers
spend a large majority of their time and money in their local communities and
that, as a result, Web users are increasingly seeking targeted, relevant
information concerning local events, places of interest, products and services
available for sale and other information that is pertinent to their local
activities. The Media Audit reports that 39% of the adult population living in
66 metropolitan areas in the United States were online in the second quarter
of 1998. According to a survey conducted by Find/SVP, over half of United
States Internet users accessed some type of online local news and information
during the first three months of 1997. Additionally, businesses are seeking
cost-effective means to target advertising and direct marketing efforts based
on demographic characteristics, specific interests and geographic location.
McCann-Erickson Incorporated estimates that businesses spent approximately $77
billion in 1997 on traditional, indirect advertising efforts in local markets.
With the Internet, businesses can directly interact with consumers, receive
immediate feedback on their marketing efforts and refine advertising campaigns
on a real-time basis. The Company believes that the Web is becoming a more
effective and efficient means for businesses to reach local consumers. In
addition to improving advertising and marketing efforts, the increasing
functionality and availability of the Internet have made it an increasingly
attractive medium for conducting commerce. A broad range of consumer products
is being sold online, including tickets to live events, books, computers,
travel services, brokerage services, automobiles and music. IDC estimates that
the amount of commerce conducted worldwide over the Web will grow from over
$12 billion at the end of 1997 to more than $425 billion by the end of 2002,
of which approximately $93.5 billion is estimated to be goods and services
purchased by users over the Web from their homes.

Web users seeking relevant local information, as well as local businesses
interested in advertising to targeted consumers, currently lack effective Web
resources. As the Internet has evolved, Web users have used sites devoted to
local areas within navigational guides, such as search engines and
directories, and Web sites provided by newspapers and other traditional media
sources. Local content within large navigational guides is often comprised of
hypertext links to multiple, disparate Web sites that may provide the user
with inconsistent and confusing user interfaces, outdated information and no
common database to enable information searches. While Web sites for
traditional media, including newspapers and television stations, effectively
provide Web users with updated news coverage, traditional media organizations
often lack the internal resources to structure easy-to-use, interactive event
and transaction guides for Web users. In addition, the Company believes such
Web sites frequently do not provide local businesses with useful geographic
and editorial context for a business' Web presence. Finally, many traditional
media organizations, while possessing strong brand names in their local
markets, do not have experience in fielding, training and managing a sales and
production force skilled at selling Web sites to local businesses, producing
high quality Web-based advertising, providing sophisticated online transaction
capabilities and necessary customer support. For local businesses seeking a
means of establishing a Web presence, the current alternatives include either
building their own Web site or placing an advertisement with an electronic
yellow pages site. Custom Web sites are often expensive to develop and
maintain, and may not attract high levels of Web site traffic without
significant promotion. Placing an advertisement with an electronic yellow
pages typically provides neither an appropriate editorial context for a local
business' site nor assistance on how to effectively reach consumers.

The Company believes there is a growing demand for online city guides that
provide frequently updated local information organized in an intuitive manner
and targeted at metropolitan consumers. The Company believes that consumers
are seeking a guide that provides extensive information on local events,
business listings and community activities, offers a user-friendly interface
to facilitate rapid information access, allows users to search within a city-
specific site, and provides a platform for online transactions. The Company
additionally believes that as Internet users are increasingly seeking such
information, traditional media sources are also seeking to partner with
companies that are able to provide the appropriate technology and business
processes to develop an online presence. Similarly, businesses are seeking
high quality Web presences, editorially targeted at interested consumers, at
an affordable cost. Indicative of this opportunity, Jupiter Communications
estimates that

56
<PAGE>

the amount of local business advertising online will grow from 9% of total
online advertising revenues in 1996 to 37% in 1998 and 54% of the $7.7 billion
in online advertising in 2002. Forrester estimates that total worldwide
Internet advertising will increase from $1.5 billion in 1998 to $15.2 billion
in 2003. As a result, the Company believes a significant opportunity exists
for a local city guide that meets consumers' demands for local information and
businesses' objectives for targeting, interacting with and selling to these
local consumers.

The Automated and Online Ticketing Industry

The supply of tickets for live events, both domestically and
internationally, has grown in recent years due to increases in the number of
facilities, facility size and seating capacity, event expansion into new
market areas (e.g., new sports teams and leagues) and increases in the number
of event performances. Ticket supply has also been enhanced by the need for
facilities to continually present as many revenue-producing events as possible
in order to meet their financial and other obligations. In recent years, the
public's increased demand for tickets to certain live entertainment events has
been evidenced by its willingness to pay higher ticket prices to attend these
events and the spread of public interest in certain types of events beyond
customary boundaries (e.g., increased worldwide interest in American
basketball).

Tickets have historically been distributed through box offices and retail
outlets. These traditional ticket distribution methods have been characterized
by inefficiencies, including the lack of ticket accountability, inefficient
inventory control systems, inability to capture ticket sales information on a
real-time basis, and limited public access to tickets. Automated ticketing
services have grown substantially in response to the needs of venues, sports
franchises and promoters to more effectively and efficiently distribute and
manage the expanding supply of tickets, and to accommodate the public's
increasing demand for fair and convenient access to such tickets.

Automated ticketing companies that process and sell tickets for live events
contract with arenas, stadiums and other venues, sports franchises and event
promoters to provide ticket sales, promotion, distribution, inventory control,
and transaction processing and fulfillment services. Currently, other than
tickets sold at venue box offices, the substantial majority of tickets for
live events which are made available to the general public by automated
ticketing companies are purchased through telephone call centers and
independent retail ticket outlets. The Web provides venues, sports franchises
and event promoters with innovative ways to market tickets to live events,
including seating maps, presentation of event related content, sale of
distressed inventory in the last hours or days before an event, and a
purchasing process that enables consumers to conveniently purchase tickets at
home. Jupiter Communications predicts that the percentage of concert tickets
sold online will increase from 1.8% of total concert ticket sales in 1998 to
19.2% in 2002.

By selling live event tickets through automated ticket companies, the
Company believes venues, sports franchises and event promoters are better able
to centrally control ticket inventory and proceeds, collect and utilize
accounting information and market research data, manage transaction costs,
effect the broad, expedient and equitable distribution of tickets and widely
disseminate event information. Consumers are able to purchase tickets over the
telephone or by visiting an independent retail ticket outlet, such as a music
store, that is more conveniently located by the consumer's home or office than
the box office of the applicable venue.

Automated ticket companies are increasingly utilizing the Internet in an
effort to provide greater marketing and distribution capabilities for clients
and to enable consumers to more conveniently purchase live event tickets. The
Company believes the Web provides significant opportunities for venues and
other clients and marketing partners to use collected demographic information
to reach and interact with targeted audiences (e.g., advance notice of
upcoming events and promotional and merchandising opportunities). Additional
opportunities may exist internationally to reach additional live event venues
in what the Company believes are historically under-penetrated geographic
regions for ticketing services. The Company further believes consumers will
increasingly recognize the convenience of the Web for purchasing tickets to
live entertainment events as the transactional capabilities of the Internet
become more familiar, comfortable and easier for consumers to use.

57
<PAGE>

THE TICKETMASTER ONLINE-CITYSEARCH SOLUTION

The Company operates two complementary Web services: a network of CitySearch
local city guides and the Ticketmaster Online Web site. The CitySearch city
guides provide up-to-date information regarding arts and entertainment events,
community activities, recreation, business, shopping, professional services
and news/sports/weather to consumers in metropolitan areas. Ticketmaster
Online offers consumers up-to-date information on live entertainment events
and a convenient means of purchasing tickets for live events and related
merchandise on the Web in 44 states and in Canada and the United Kingdom.
Consumers can access the Ticketmaster Online service at www.ticketmaster.com
and from CitySearch owned and operated city guides at www.citysearch.com
through numerous direct links from banners and event profiles. Pursuant to the
terms of the Ticketmaster License Agreement and subject to certain
limitations, Ticketmaster Online is Ticketmaster Corp.'s exclusive agent for
the online sale of tickets to live events presented by Ticketmaster Corp.'s
clients.

CitySearch

Each local city guide primarily consists of original content developed and
designed specifically for the Web by the Company and its partners. The Company
designs and produces custom-built Web sites and performs related services for
local and regional businesses, aggregates them in a local city guide
environment and provides these businesses with the ability to regularly update
and expand their sites. The CitySearch sites offer local and regional
businesses the opportunity to reach and interact with targeted consumers.

The Company typically targets medium- to large-sized cities for its
CitySearch city guides with a combination of high personal computer
penetration, high Internet use, strong population growth, significant high
technology employment, a large university population and a government
presence. The Company has two primary means of providing its local city
guides. In its owned and operated markets, the Company systematically produces
the majority of its own content, hires and deploys a direct sales force to
sell custom-built Web sites to local businesses and contracts with local media
companies (primarily radio and television stations) for promotion and
distribution. In other markets, the Company partners with a local media
company (usually a leading daily newspaper) that contracts with the Company to
assist in designing, developing and launching a city guide. These partners
license the Company's systems and provide royalty payments to the Company on
revenues derived from operations. As of September 30, 1998, the Company
provided CitySearch city guides in 15 cities, seven of which are owned and
operated and eight of which are partner-led markets. The Company and its
partners are in the process of rolling out their services in two additional
partner-led markets in Copenhagen and San Diego.

Ticketmaster Online

Ticketmaster Online is a leading online ticketing service that enables
consumers to purchase tickets for live music, sports, theater and family
entertainment events presented by Ticketmaster Corp.'s clients and related
merchandise over the Web. The Company believes the online nature of the
service offers improved marketing and distribution capabilities as well as a
larger potential consumer base to Ticketmaster Corp. clients, while providing
consumers more convenient access to live event tickets and related
merchandise. In addition to these services, the Ticketmaster Online Web site
provides local information and original content regarding live events for
Ticketmaster Corp. clients throughout the United States, Canada and the United
Kingdom.

Ticketmaster Online distributes tickets over the Internet for Ticketmaster
Corp.'s clients, including over 3,000 venues, sports franchises and event
promoters. In addition to serving both multi-event and single event promoters,
Ticketmaster Corp.'s venues range in size from large stadiums with more than
60,000 seats to smaller theaters with fewer than 1,000 seats. Through
Ticketmaster Online, consumers can purchase tickets over the Internet for 94
professional sports franchises in North America, including 16 Major League
Baseball teams, 18 National Football League teams, 23 National Basketball
Association teams, 20 National Hockey League teams, ten Major League Soccer
teams and seven Women's National Basketball Association teams.

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Key elements of the Company's solution include the following:

Leading Local Online Services and Ticketing. The Company is a leading
provider of online local city guides and ticketing services for live events.
CitySearch has launched or initiated a roll-out of Web-based local city guides
in major national and international markets, including Austin, Baltimore,
Dallas, Los Angeles, Nashville, New York City, Portland, Raleigh-Durham-Chapel
Hill, Salt Lake City/Utah, San Diego, the San Francisco Bay Area, Washington,
D.C., Copenhagen, Melbourne, Stockholm, Sydney and Toronto. The Company
believes the success of its city guide approach is evidenced by the
approximately 8,500 CitySearch local and regional business Web sites that were
online as of September 30, 1998 in its owned and operated markets, the
approximately 8,400 business Web sites that the Company believes were online
as of September 30, 1998 in its partner-led markets, and by its consumer base
penetration and consumer usage. According to a RelevantKnowledge study, the
Company had approximately 743,000 unique adult users in its CitySearch owned
and operated markets in June 1998. A "unique user" is an individual Web user
who visited a particular Web site at least once in the reporting month. The
common Web term "hit" refers to a Web user's access of a single file on a Web
page, which may contain multiple files. The Company believes that
approximately 6.4% of the local market online consumers used the CitySearch
service in these markets. Media Metrix reports that Ticketmaster Online had
1.3 million unique users in July 1998. Gross transaction dollars from live
event ticket sales through the Ticketmaster Online Web site increased from
approximately $270,000 in November 1996 to approximately $11.6 million in
September 1998.

Differentiated Service Offering. The Company believes its CitySearch local
city guides in combination with its Ticketmaster Online sales of tickets and
related merchandise differ substantially from competitive offerings. The
Company develops and regularly updates the content of its city guides, both
internally and in conjunction with local media partners, as well as the live
event information presented by Ticketmaster Online. Unlike navigational guides
that typically access content from third-party Web sites that may be
incomplete or out of date, CitySearch sites encompass a broad array of
updated, community-specific content that is easily accessed through the
CitySearch common interface. The Company's city guides have received numerous
awards and recognition for design, functionality and content, including PC
Magazine's Editor's Choice, USA Today/Intelliquest's survey leader, the 1998
Webby award for best travel site, two 1998 Local Internet Service Awards for
Best Local/Regional Directory and Best City Guide, recognition by The New York
Times as best overall online guide to New York City and Net Guide's Platinum
"Best of the Web" award. In addition, the Ticketmaster Online Web site
received Internet Shopper Magazine's Spring 1997 Internet Shopper Choice award
for Best Entertainment Web Site and Interactive Services Association's award
for Best Online Application (Products and Services) and was included in
WebMaster Magazine's Top 50/50 Internet & Intranet Sites.

Strategic Partnerships. The Company is engaged in a number of strategic
partnerships with media, content and other companies in order to build the
CitySearch and Ticketmaster Online brand names as well as the network of city
guides. The Company has agreements to develop city guides in partnership with
The Baltimore Sun, The Dallas Morning News, the Los Angeles Times, The San
Diego Union-Tribune, Washingtonpost.Newsweek Interactive, Big Colour Pages
(independent yellow pages of Australia), The Melbourne Age, Schibsted
ASA/Scandinavia Online (Copenhagen, Oslo and Stockholm), The Sydney Morning
Herald, Tele-Direct (the yellow pages subsidiary of Bell Canada, Inc.), and
the Toronto Star. Several of the Company's strategic relationships involve
equity investments from the Company's partners, including
Washingtonpost.Newsweek Interactive Company, The Times Mirror Company, owner
of the Los Angeles Times and The Baltimore Sun, Schibsted ASA and Toronto Star
Newspapers Limited. These major media partners also bring capital, brand
recognition, promotional strength and local knowledge to their CitySearch
sites and allow the Company to build out its national and international
network of sites faster than it could solely through owned and operated sites.

In July 1998, the Company entered into an agreement with Classified
Ventures, a leading provider of online advertising products and services to
the newspaper industry. Classified Ventures is funded by Central Newspapers
Inc., Gannett Co., Inc., Knight Ridder, Inc., The McClatchy Company, The New
York Times Company, The Times Mirror Company, Tribune Company and The
Washington Post Company, and has a

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network of over 140 affiliated newspapers in 44 states, including 34 of the
nation's top 50 markets. CitySearch has licensed elements of its technology
and business systems to Classified Ventures and provide services in automotive
and real estate classified advertising categories. Certain CitySearch owned
and operated city guides may also participate as Classified Ventures
affiliates in their respective markets.

In owned and operated CitySearch markets, the Company partners with local
media companies to assist it in developing content and expanding its
promotional activities. For example, the Company has partnered in Salt Lake
City/Utah with the CBS television station (KUTV) and six radio stations owned
by Citadel Communications Corporation, in San Francisco with the ABC
television station (KGO) and two CBS-owned radio stations and in Raleigh-
Durham-Chapel Hill with the national public radio station (WUNC) and with four
radio stations owned by Capstar Broadcasting Corporation. In addition, the
Company is a party to an agreement with American Express pursuant to which
American Express made an equity investment in the Company, and that provides
for the distribution of co-branded marketing materials for the sale of
business Web sites to American Express merchant customers, American Express
sponsorship and banner advertising, introduction of e-commerce products and
services, sponsorships and other promotions. The Company has also reached
agreements or arrangements with Earthlink Network, Inc., The Walt Disney
Company's Family.com, CNET, Inc.'s Snap! Online, Planet Direct Corporation,
@Home Corporation and Internet Travel Network to expand its distribution
efforts.

The Company participates in several media, marketing and technology
initiatives. For example, Ticketmaster Online has entered into agreements with
major media companies such as the Los Angeles Times, The New York Times and
Tribune Interactive to create co-branded Web sites containing event listings,
other content and promotional opportunities for advertisers. Pursuant to an
agreement between TM Ticketing and N2K, Ticketmaster Online has created a co-
branded Web presence with N2K (Music Boulevard) to promote and sell music
products. The agreement is currently subject to litigation, initiated by TM
Ticketing, between the parties. See "Risk Factors--Potential Governmental
Investigations and Litigation." Ticketmaster Online advertises products and
services of Ford Motor Company, International Business Machines Corporation,
Red Lobster, Sprint Communications Company, L.P., United Parcel Service of
America, Inc. and Yahoo!. Ticketmaster Online is also working with Intel
Corporation to jointly develop the "my Ticketmaster" site, a personalized Web
application designed to enable users to choose categories of event information
based on personal preferences and that is scheduled to launch in the fourth
quarter of 1998.

Differentiated Presence on the Web For Local and Regional Businesses. The
Company creates CitySearch Web sites for local and regional businesses,
aggregates the Web sites in a local city guide environment and provides
businesses the ability to regularly update and expand their sites. The Company
believes its CitySearch service offers local and regional businesses the
opportunity to reach and interact with targeted audiences in a cost-effective
manner. The Company provides business customers with integrated solutions to
establish customized, multi-page Web sites including design, layout,
photography, posting of updated information, hosting and maintenance.
Businesses are able to provide a targeted audience with updated information
about their products and services, including photographs, prices, store
location, schedules of live entertainment, audio clips, e-mail distributions,
specials or sales and other relevant information. The Company typically
creates a customized, multi-page Web site for its customers with a minimal up-
front fee and monthly fees ranging from $60 to $750 per month. The Company
believes its broad offering of CitySearch services and prices compares
favorably to other Web advertising options available to businesses. Such
options range from low cost, low quality scanned-in information to free-
standing custom-designed sites that may cost in excess of $10,000 in up-front
fees to produce and that rely on significant additional promotion to attract
traffic. By providing a high quality Web presence at an affordable price, the
Company believes that its services address the demand of the large number of
businesses whose online needs fall between these market extremes.

Community-Based Approach. The Company differentiates itself from most
national developers of local city guides by building many of the CitySearch
owned and operated sites with involvement from city governments, chambers of
commerce, community associations, schools and other community groups, and by
focusing its hiring efforts within the local community. The Company builds
free Web sites for selected

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community organizations, provides tools for e-mail to constituents and
community forums and maintains guides to community services and volunteer
organizations, thereby enhancing the sense of community each CitySearch site
provides. The Company believes that its community-based approach builds
consumer interest in the site both directly, since the content it provides is
of interest to many individuals and is not generally covered by competing city
sites, and indirectly, because it builds broad support and "ownership" in the
community. The Company has secured strong community support for its service in
each of its markets, and the launch of many of its owned and operated markets
has been presided over by the mayor or governor.

STRATEGY

The Company's objective is to be the leading provider of comprehensive local
city guides and online live event ticketing to attract a new and larger group
of consumers to the Internet and provide an easy-to-use resource for local
information and transactions. The Company's strategy is focused on rapidly
rolling out its services in the most attractive, Web-penetrated communities
worldwide, establishing a leading presence in these communities while
increasing traffic and repeat usage of its network. In addition, the Company
intends to use the CitySearch local city guides and Ticketmaster Online
ticketing service as platforms for multiple revenue streams. The following are
key elements of this strategy:

Rapidly Build National and International Network and Brand Awareness. The
Company intends to establish its services as the category leader for local
information and live event ticketing on the Web by linking its local city
guides together in a national and international network. The Company believes
that as the number of its sites and usage of its service increase, it is
creating a readily recognizable brand name for local content and live event
ticketing on the Internet. As of September 30, 1998, the Company's CitySearch
service operated in 15 metropolitan areas worldwide, and the Company had
initiated roll out for launches in two additional metropolitan areas. The
Company intends to continue to aggressively enter targeted markets, including
territories in which Ticketmaster Corp. clients are located, through either an
owned and operated market presence or by entering into partnerships and
strategic alliances with major media and telephony companies. The Company's
roll-out teams are led by experienced managers who prepare for launch of a
CitySearch site in owned and operated markets by hiring and training local
management teams, building the initial community relationships, negotiating
promotional arrangements with local media, training a direct sales force of
Internet Business Advisors ("IBAs") and selling initial sites. The Company's
detailed roll-out process has been refined in seven owned and operated market
launches to date. In partner-led markets, the Company provides its roll-out
expertise, professional personnel and technical infrastructure to assist
partners in creating effective sites and initiating rapid and successful
launches.

The Company intends to further emphasize the differentiation of its services
by leveraging the widely-recognized Ticketmaster brand name and its live
events ticketing and merchandise distribution capabilities. The Company
believes that the Ticketmaster brand name and extensive distribution
capabilities of the Ticketmaster Online Web site combined with the local city
guides will help enable the Company to continue to increase penetration among
established live event ticketing and merchandise consumers, and will provide
opportunities to expand internationally to live event venues in historically
under-penetrated geographic regions. The Company believes that its branded and
expanding network of local city guides in Web-penetrated markets will
increasingly attract local, regional and national advertisers that seek to
efficiently target local markets and consumers seeking information about
cities where they live or intend to visit.

Provide Multiple Revenue Streams. CitySearch local city guides and the
Ticketmaster Online ticketing service provide platforms for multiple revenue
streams. With respect to Ticketmaster Online, the Company derives revenues
from online sales of tickets to live events and related merchandise, as well
as advertising. In owned and operated CitySearch markets, the Company derives
recurring fees from the sale of Web sites to local businesses, as well as
banner and sponsorship advertising. Part of the Company's strategy is to
increase average monthly revenue from new business customers, in part through
the introduction of new services. Between September 1997 and September 1998,
average monthly revenue from new customers on CitySearch local city guides
increased from approximately $80 to approximately $190. In partner-led
markets, the Company derives

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licensing and royalty revenues from the licensing of the Company's technology
and business systems, consulting services, and from providing back office and
hosting services. The Company intends to offer additional e-commerce
functionality and other features designed to enable businesses to better serve
consumers, including reservations, electronic coupons, and other transactions.
The Company further believes that its platforms will help enable it to take
advantage of new opportunities in areas such as entertainment information,
merchandising, advertising, promotional services and direct marketing.

Increase Usage and Frequency of Use of the Network. The Company plans to
increase usage of its network by continuing to provide compelling content and
expanding services that it believes are most desired by consumers. For
example, the Company is actively developing means of increasing the
personalization capabilities of its services to enable consumers to be
notified of upcoming events, reviews and transaction offerings for which they
specify a direct interest. In addition, the Company intends to introduce in
the fourth quarter of 1998 its new "my Ticketmaster" Web site, which is
designed to enable consumers to tailor live event information to individual
preferences. The Company intends to continually improve the convenience of its
services to businesses and consumers through technology enhancements such as
user interface refinements and increased efficiencies in transaction
processing and fulfillment operations. The Company also plans to increase
traffic over its network through strategic relationships and through increased
integration of the content and services provided by CitySearch city guides and
Ticketmaster Online. The Company believes these types of services offer the
Company the opportunity to attract new and existing consumers and businesses
to its sites. As the Company's network of city guides expands, the Company
intends to pursue regional and national media distribution arrangements to
help drive traffic to the Company's Web services.

Continue to Enter into Strategic Alliances. The Company intends to continue
to differentiate its services by entering into agreements with local radio,
television and other media and telephony companies in its future owned and
operated markets and with major newspapers and other media and telephony
companies in its domestic and international partner-led markets. The Company
believes major newspapers, in particular, are trusted sources for local
information and possess strong brand names in their communities. In addition,
the Company intends to aggressively pursue strategic relationships to enhance
its content offering, transaction capabilities and revenues. For example, the
Company has recently entered into relationships with Classified Ventures to
provide a variety of services and technology for classified advertising and
with American Express to promote the Company's services and coordinate e-
commerce initiatives. The Company will also continue to evaluate means of
expanding the reach of its services through additional alliances with other
Web sites, online service providers and through other relationships. Through
the Ticketmaster Online Web site, the Company participates in several media,
marketing and technology initiatives, with companies including Yahoo!, Intel
Corporation, Tribune Interactive, JAM TV, RealTime Sports, the Los Angeles
Times and The New York Times.

Expand Reach of Online Ticketing and City Guide Services. The Company
intends to increase the reach of its online live event ticketing and city
guide services. By further integrating ticketing functionality into its local
city guides, the Company intends to make online ticketing available to more
consumers. Furthermore, the Company believes that as a result of increases in
the number and seating capacity of venues, the number of teams and sports
leagues and the number of live entertainment events, significant opportunities
exist to increase the online sale of tickets and related merchandise. The
Company intends to work with Ticketmaster Corp. to extend the online
availability of live event tickets and related merchandise with respect to
smaller venues than have traditionally been served by automated ticketing
systems. The Company intends to increase the number of metropolitan areas
served by its CitySearch city guides by taking advantage of Ticketmaster
Online's presence in certain local areas.

Integrate CitySearch and Ticketmaster Online Services. The Company intends
to increase the degree of integration between the Ticketmaster Online site and
the CitySearch city guides in the short and medium term. Presently, numerous
hypertext links allow consumers to move between the sites easily. In the next
few months, the Company intends to exchange content between its services so
that, for example, consumers viewing event profiles on a CitySearch city guide
site will be able to click through to a co-branded Web page in order to
purchase live event tickets. Such ticketing-enabled event profiles would be
highlighted as such on city guide

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home pages, section pages, search results, and within the profiles themselves.
The Company also intends to synchronize the Ticketmaster Online and CitySearch
services events databases in order, for example, to automatically generate
ticketing-enabled event profiles, or provide immediate notification of recent
live event ticket availability to CitySearch's consumers who have registered
for personalization services. The Company further intends to locate the
majority of the Ticketmaster Online employees in the Company's Pasadena office
by the end of the first quarter of fiscal 1999.

CITYSEARCH BUSINESS

CitySearch Service for Consumers

The Company produces and delivers comprehensive local city guides on the
Web, providing up-to-date information regarding arts and entertainment events,
community activities, recreation, business, shopping, professional services
and news/sports/weather to consumers in metropolitan areas. Each local city
guide primarily consists of original content developed and designed
specifically for the Web by the Company and its partners. The CitySearch
service is topically organized by categories, such as arts and entertainment,
restaurants and bars, community, shops and services, sports and outdoors,
hotels and tourism, local news and professional services. Within most of the
city guides, consumers can search neighborhood shopping areas, obtain maps,
contact community organizations and vendors by e-mail, and engage in bulletin
board discussions with individuals such as local public officials and
celebrities. In CitySearch owned and operated markets, consumers can also
access the Ticketmaster Online Web site through CitySearch city guides to
purchase live event tickets and related merchandise online. In certain
markets, consumers can also access audio streams, including recent news and
other information, from local radio partners. CitySearch offers local and
regional businesses the opportunity to reach and interact with targeted
consumers. In addition, content generated by consumers through e-mail and
bulletin boards enhances the sense of community in CitySearch sites. For
example, in September 1998, the message boards within the Company's owned and
operated city guide sites received approximately 130,000 page views and
approximately 6,500 individual "posts" of information by consumers. As of
November 4, 1998, the Company's owned and operated city guide sites contained
approximately 1,300 "posts" by consumers in the "Buzz" areas of the sites,
where consumers can share their opinions and experiences about events and
locations described within the sites. In addition, the Company's owned and
operated city guides hosted numerous national celebrity online chats over the
past 12 months, including a chat event with Christian pop music celebrity Amy
Grant, in which approximately 400 users participated, with rock band Jethro
Tull, in which 170 users participated, and with pin-up celebrity Bettie Page,
in which 130 users participated.

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The CitySearch service has been launched in markets across the United States
and in selected international markets. The Company plans to continue to expand
the service both in owned and operated markets and by partnering with major
media companies in other markets. These major media partners bring capital,
brand recognition, promotional strength and local knowledge to their city
guides and allow the Company to build out its national and international
network of sites faster than it could solely through owned and operated sites.
The following table lists the Company's owned and operated and partner-led
markets:

<TABLE>
<CAPTION>
MARKETS DATE OF LAUNCH SELECTED PARTNERS
<C> <C> <S>
OWNED AND OPERATED:
Raleigh-Durham-Chapel May 1996 WUNC (public radio station)
Hill Capstar Broadcasting Corporation (4
radio stations)
WCHL AM
The Independent (weekly arts and
entertainment publication)
San Francisco Bay Area October 1996 KGO (ABC)
CBS Radio (2 radio stations)
Austin March 1997 KTBC (Fox)
Clear Channel Communications, Inc. (4
radio stations)
Salt Lake City/Utah April 1997 KUTV (CBS)
Citadel Communications Corporation (6
radio stations)
Nashville May 1997 WZTV (Fox)
Dick Broadcasting (2 radio stations)
Portland June 1997 KATU (ABC)
KKCW FM
New York(1) September 1997 New York Daily News
Time Out New York (weekly arts and
entertainment publication)
PARTNER-LED:
Melbourne July 1997 The Melbourne Age
Big Colour Pages (independent yellow
pages of Australia)
Sydney September 1997 The Sydney Morning Herald
Big Colour Pages
Toronto September 1997 Toronto Star
Tele-Direct (the yellow pages
subsidiary of Bell Canada)
Washington, D.C. January 1997 Washingtonpost.Newsweek Interactive
Los Angeles(2) April 1998 Los Angeles Times
Dallas July 1998 The Dallas Morning News
Baltimore August 1998 The Baltimore Sun
Stockholm September 1998 Schibsted ASA/Scandinavia Online
Copenhagen 1998* Schibsted ASA/Scandinavia Online
Oslo 1999* Schibsted ASA/Scandinavia Online
San Diego 1999* The San Diego Union-Tribune
</TABLE>
* Estimated launch dates

(1) The Company acquired Metrobeat, Inc. ("Metrobeat") in June 1996 and
relaunched the Metrobeat site as a CitySearch site in September 1997.

(2) Includes Pasadena, California, which was launched as a beta test site in
January 1996.

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CitySearch Service for Business Customers

The Company creates and hosts CitySearch Web sites for local and regional
businesses and organizations for a monthly fee. The Company offers local
businesses a wide range of options in creating Web presences, from a basic Web
presence costing as little as $60 per month to a multi-page site with
additional features and functionality costing up to $750 per month. Most
business customers have entered into a one-year agreement that automatically
converts into a month-to-month contract upon expiration of the initial term.
By aggregating a customer's Web site with those of numerous other businesses
in a comprehensive local city guide, the Company provides categorical,
geographic and editorial context to a customer's Web presence to generate
usage by consumers, as well as significant Internet traffic. Based on internal
studies, the Company believes that CitySearch users are more evenly split
between men and women, better educated, slightly older and have higher annual
incomes than the typical Internet user. The Company believes that these
demographics are attractive to its business customers.

The Company provides an integrated solution for businesses to establish a
CitySearch Web presence, including design, photography, layout, posting of
updated information, hosting and maintenance. Businesses are able to provide a
targeted audience with current information about their products and services
including photographs, prices, location, schedules of live entertainment,
sales and other relevant information. Unlike traditional media such as yellow
pages advertising, the Company offers CitySearch business customers a certain
number of free updates each month. The business customers also receive usage
reports, e-mails from interested consumers and access to an expanded base of
potential buyers including tourists and out-of-town users. The Company has
recently introduced a strategy of bundling enhanced features and
functionality, including panoramic images and audio clips. These services,
when bundled with the Company's basic CitySearch services, are typically
priced from $190 to $1,195 per month, and have accounted for significant
increases in the average selling prices of the Company's offerings. The
Company believes its broad offering of services and its prices compare
favorably to other Web advertising options available to businesses. Such
options range from low cost, low quality scanned-in information to free-
standing custom-designed sites that may cost in excess of $10,000 in up-front
fees to produce and that rely on significant promotion to attract traffic. By
providing a high-quality Web presence at an affordable price, the Company
believes that its services address the demand of the large number of
businesses whose online needs fall between these market extremes.

The Company's proprietary site design tools and production economies enable
it to build customized multi-page Web sites for customers for a minimal up-
front fee. The production of business Web sites for CitySearch owned and
operated markets and certain partner-led markets is managed centrally in the
Company's headquarters to better control quality and cost and provide rapid
production. Business Web site creation follows a standardized process. First,
IBAs in the field work with customers to design their sites and gather images
and text. Once content is collected, IBAs forward this information to the
Company's central production site in Pasadena, California where data entry
personnel input the text. Graphic designers then use the Company's proprietary
software to combine the text and scanned images to create custom sites
designed to reflect the nature and style of each business customer. Once the
Web site designers have completed their work, the business Web site is checked
for accuracy and published online after a 14-day customer proofing period. The
entire process, from the receipt of content by the Company to putting a site
online, takes approximately one month to complete. Each step of the sales and
production process is monitored by an enterprise management system to ensure
that the process is consistent and complete. The Company believes the systems
and processes it has developed to produce business Web sites allow it to
create higher quality, more informative sites in a more cost-effective and
timely manner than its competitors.

The Company intends to offer e-commerce functionality and other innovative
features allowing businesses to better serve consumers, including ticketing,
reservations, sales events notifications, electronic coupons, newsletters and
other transactions. The Company believes these types of services offer the
Company the opportunity to further attract both consumers and businesses to
its local city guides.

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CitySearch Strategic Alliances

The Company has entered into partnerships and strategic alliances with third
parties in order to (i) rapidly build its national and international network
of CitySearch local city guides, (ii) generate licensing revenue in CitySearch
partner-led markets, (iii) facilitate branding, (iv) gain access to additional
content and (v) drive traffic on the Company's network of sites. Management
intends to continue to negotiate further partnerships and alliances.

Newspaper and Telephony Partnerships. The Company has entered into strategic
partnerships with major newspapers and media companies such as The Baltimore
Sun, The Dallas Morning News, the Los Angeles Times, The San Diego Union-
Tribune, Washingtonpost.Newsweek Interactive, Big Colour Pages (independent
yellow pages of Australia), The Melbourne Age, Schibsted ASA/Scandinavia
Online (Copenhagen, Oslo and Stockholm), The Sydney Morning Herald, Tele-
Direct (the yellow pages subsidiary of Bell Canada, Inc.) and the Toronto
Star. In these partner-led markets, the partner provides the capital and
management, while the Company contributes technology, a business model,
consulting services, business systems and processes and network participation.
The Company typically receives up-front license fees, ongoing license fees for
delivery of upgrades and support, and royalties based on revenues that the
partner generates through the city guide service. In addition, the Company
generally receives additional fees for consulting services in connection with
the launch of the partner's city guides, custom engineering requested by
particular partners, and compensation for business Web site production,
customer service, billing and hosting services. These partner agreements are
typically five to eight years in length, and contain customary termination
rights in the event of material breach or non-performance. The Company
believes these arrangements allow it to expand its national and international
network of cities in a more rapid and cost-effective manner than a solely
owned and operated network would allow.

The Company has also reached content sharing and linking agreements with
various companies, including the New York Daily News Online Edition and Time
Out New York. Under these agreements, the Company's city guide sites and
content partners create co-branded areas and host certain content supplied by
the content partners.

In August 1998, the Company restructured its relationship with Toronto Star
Newspapers Limited in order to admit a new partner with significant brand,
sales and financial resources. Under the terms of the partnership agreement,
Toronto Star Newspapers Limited and Tele-Direct Inc. each hold a 45% interest
in the partnership and together operate the toronto.com Web service. The
Company holds a 10% interest in the partnership and licenses its technology
and business systems to the partnership for use in the defined territory.

In July 1998, the Company entered into agreement with Classified Ventures, a
leading provider of online advertising products and services to the newspaper
industry. Classified Ventures is funded by Central Newspapers, Inc., Gannett
Co., Inc., Knight Ridder, Inc., The McClatchy Company, The New York Times
Company, The Times Mirror Company, Tribune Company and The Washington Post
Company, and has a network of over 140 affiliated newspapers in 44 states,
including 34 of the nation's top 50 markets. The Company licensed elements of
its technology and business systems to Classified Ventures and provides
services in automotive and real estate classified advertising categories. The
agreement may be terminated effective 2001 by Classified Ventures. Certain
CitySearch owned and operated city guides may also participate as Classified
Ventures affiliates in their respective markets.

Television and Radio Media Alliances. The Company has entered into co-
promotion agreements with local television and radio stations in most of its
CitySearch owned and operated markets. These relationships typically offer
content sharing and co-promotion to both parties. The Company works with each
partner to develop a multimedia Web site within the CitySearch site, while the
partner offers promotion and a recognized brand within the market. The Company
typically receives significant on-air promotion from these television and
radio stations that increases brand awareness and drives traffic to the
CitySearch site. For example, the Company has partnered in Salt Lake City/Utah
with the CBS television station (KUTV) as well as radio stations owned by
Citadel Communications Corporation and, in Raleigh-Durham-Chapel Hill, with
the national public radio station (WUNC) and radio stations owned by Capstar
Broadcasting Corporation. In San Francisco, the Company has agreements with
the ABC television station (KGO) and radio stations owned by CBS.

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Marketing Agreements. The Company has entered into both local and national
marketing agreements. For example, the Company recently is a party to an
agreement with American Express which included an equity investment in the
Company. The agreement provides for distribution of co-branded marketing
materials to American Express merchant customers in the Company's local
markets that will offer merchant customers online Web site presences through
the Company's local city guides. The parties intend to create areas within the
CitySearch sites to aggregate promotions and discounts offered to consumers by
American Express merchant customers as well as develop additional e-commerce
products. In addition, American Express will purchase sponsorships and banner
advertising on the CitySearch sites. The agreement expires in 2002, subject to
certain provisions allowing for early termination in the event of a change of
control of the Company. In local markets, the Company reached an agreement
with Levi Strauss Associates Inc.'s Dockers Khakis to provide sponsorship,
editorial features and contests relating to two 1998 San Francisco film
festivals, and created printed local information guides for the United States
Tennis Association and American Express for distribution at the U. S. Open.
The Company intends to continue to aggressively pursue such marketing
agreements in order to attract additional business customers and increase
usage of the CitySearch service by consumers.

Content Distribution Alliances. The Company has entered into agreements with
a number of companies to distribute its content and drive traffic to the
Company's Web sites. For example, the Company has entered into agreements or
arrangements with Earthlink Network, Inc., The Walt Disney Company's
Family.com, CNET, Inc.'s Snap! Online, Planet Direct Corporation, @Home
Corporation and Internet Travel Network to distribute content across relevant
sites.

Marketing and Sales

The Company emphasizes marketing activities in its owned and operated
markets aimed at increasing awareness of its CitySearch local city guides for
both consumers and business customers. The Company's roll-out teams are led by
experienced managers who prepare for launch by negotiating promotional
arrangements with local media, training a direct sales force and selling
initial sites. The Company conducts advertising and public relations campaigns
through low-cost "guerilla" marketing efforts and the Company's local media
partners in radio, television and print advertising to both drive business
customer sales and consumer usage. The Company also purchases targeted
advertising on Web sites such as Infoseek, Preview Travel and Yahoo! as well
as through traditional media such as radio, print and outdoor.

In partner-led markets, the Company's marketing efforts rely substantially
on the partner's existing franchise and resources in the community. Partners
typically market their city guide services through print promotion and
integration into a pre-existing news Web site. The partner's brand is also
used in conjunction with the CitySearch brand to build credibility with local
consumers. The Company provides its partners both with a roll-out team to
launch the service and ongoing support, including assistance with recruiting,
sales strategy and back office operations.

Once a city site has been launched, the Company and its partners rely upon a
direct sales force to accelerate the momentum established by the roll-out
team. As of September 30, 1998, the Company employed approximately 140 IBAs in
its seven owned and operated markets selling directly to local businesses as
well as field customers service representatives in these markets to maintain
regular contact with business customers and facilitate up-selling of Web site
functionality. Each IBA completes an intensive training program at the
Company's headquarters with follow-up field training. The Company's
proprietary enterprise management system tracks sales leads and prospect
status and allows sales managers to track performance. IBAs participate in
ongoing training sessions in sales techniques and new products.

Operations

The Company has created a systematic approach to market roll-out of its
CitySearch local city guides that is designed to enable it to launch its
service in owned and operated markets and to support a local service once
launched. In addition, the Company licenses its roll-out capabilities to media
companies in its partner-led

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markets. The Company has analyzed and documented the best practices associated
with its early city launches to refine and standardize its field and home
office production processes. The Company's software systems monitor much of
the sales and customer care functions. Additionally, the Company has built
custom systems that streamline the site creation and maintenance process.

Customer service operations are located in the Company's Pasadena
headquarters. The Company's enterprise management systems enable customer
service staff to view the customer's full profile, billing and interactive
history as they take the call, and to use the software tools to make changes
to the business customer's site in real time.

Technology

The Company has developed and implemented a number of technologies to
support its local city guide service and business operations, including (i) an
online city guide application, (ii) a set of content creation and management
tools and (iii) a suite of integrated enterprise management systems.

CitySearch Online Application. The CitySearch online application provides a
user interface intended to support novice online users while providing easily
accessible advanced features for experienced Web users. The core end-user
functionality of the CitySearch application includes (i) concurrently
performed keyword, geographic and temporal searches; (ii) personalization that
permits consumers, for example, to receive newsletters in areas of interest,
and register for special offers from CitySearch business customers that have
chosen to implement a one-to-one marketing approach; (iii) dynamic map
rendering and "nearby" functionality; (iv) real-time chat; and (v) message
boards.

CitySearch has to date employed an object-relational database to support Web
publishing and searching. With version CS 2.5 of its service, which the
Company is currently deploying in all of its markets, CitySearch is employing
a multi-tiered architecture, separating a standard relational database from
business rules and presentation logic. CS 2.5 is designed to permit city guide
publishers to create and change the appearance and, generally, the function of
the product using any commercially available Web page design tool or text
editor. As a result, the Company believes that both it and its partners will
be able to respond more quickly to changes in the marketplace and evolving
user preferences. In addition, the object-oriented architecture is designed to
provide for rapid development cycles and code reuse. The Company has made a
substantial investment in its product development infrastructure and intends
to continue to release product enhancements that address changing demands of
business customers and consumers.

Content Creation and Management Tools. The Company has created the following
applications to support editorial and advertising content production: (i)
SiteWorks, for design of business Web sites and editorial features; (ii)
EditWorks, for editorial content entry; (iii) User Interface Tree editor, for
defining and managing the site hierarchy; and (iv) MediaWorks, to enable
remote content partners, typically television and radio stations, to submit
content directly to the site. These tools are designed to minimize the
technical knowledge that editorial and advertising content producers need to
possess.

Enterprise Management Systems. CitySearch has developed and implemented a
suite of integrated enterprise management systems designed to handle an
increasing volume of business customers. The enterprise management system
consists of third-party and internally developed applications covering sales
force automation and telemarketing, production management and tracking
systems, customer service, accounting, billing and commissions systems.

The Company has also designed a sophisticated tool to manage the planning,
scheduling, forecasting and tracking of business Web sites, banners and other
services through the various stages of design and production. This tool
enables the Company to manage the large number of business Web sites and
banners developed simultaneously and originating from numerous cities. The
Company believes the systems and processes it has developed to produce
business Web sites allow it to create high quality sites in a more cost-
effective and timely manner.

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TICKETMASTER ONLINE BUSINESS

Ticketmaster Online Service

Ticketmaster Online is a leading online ticketing service that enables
consumers to purchase tickets for live music, sports, theater and family
entertainment events presented by Ticketmaster Corp.'s clients and related
merchandise over the Web. Consumers can access the Ticketmaster Online service
at www.ticketmaster.com and from CitySearch owned and operated city guides at
www.citysearch.com through numerous direct links from banners and event
profiles. In addition to these services, the Ticketmaster Online Web site
provides local information and original content regarding live events for
Ticketmaster Corp. clients throughout the United States, Canada and the United
Kingdom.

Throughout the Ticketmaster Online Web site and at the conclusion of a
confirmed ticket purchase, the consumer is prompted to purchase merchandise
that is related to a particular event, such as videos, tour merchandise and
sports memorabilia. The Company intends to expand the types and range of
merchandise that can be ordered by consumers through the Ticketmaster Online
Web site. The Company also intends to organize membership programs that will
provide Ticketmaster Online members with certain benefits centered around
entertainment, leisure and travel activities. Membership is expected to
include participation in other activities not generally available to the
public.

Since the commencement of online ticket sales in November 1996, Ticketmaster
Online has experienced significant growth in tickets sold through its Web
site. Gross transaction dollars for ticket sales increased from approximately
$270,000 in November 1996 to $11.6 million in September 1998. Similarly,
tickets sold on the Ticketmaster Online Web site in November 1996 represented
less than 0.1% of total tickets sold by Ticketmaster Corp., while tickets sold
online in the month of July 1998 represented more than 5.0%.

Ticketmaster Corp. Clients

Ticketmaster Corp. is a leading provider of live event automated ticketing
services in the United States. Ticketmaster Corp. has over 3,000 clients,
including many well-known entertainment venues, sports teams and promoters.
Ticketmaster Corp. provides these clients with comprehensive ticket inventory
control and management, a broad distribution network and dedicated marketing
and support services. Ticket orders are received and fulfilled through call
centers, independent sales outlets remote to the facility box office, and
online. Pursuant to the Ticketmaster License Agreement and subject to certain
limitations, Ticketmaster Online acts as Ticketmaster Corp.'s exclusive agent
for online sales of live event tickets.

The Company believes that the Ticketmaster system for live event ticketing
transactions (the "Ticketmaster System") and its distribution capabilities
enhance Ticketmaster Corp.'s ability to attract new clients and maintain its
existing client base. The Ticketmaster System, which includes both hardware
and software, is typically installed in a client's box office and provides a
single centralized inventory control management system capable of tracking
total ticket inventory for all events, whether sales are made on a season,
subscription, group or individual ticket basis. The versatility of the
Ticketmaster System allows it to be customized to satisfy a full range of
client requirements.

Ticketmaster Corp. is the contracting party with the venues, promoters and
sports franchises that sell tickets through Ticketmaster Online. Ticketmaster
Corp. generally enters into written agreements with its clients pursuant to
which it agrees to provide the Ticketmaster System and to serve as the
client's exclusive ticket sales agent for all sales of individual tickets sold
outside of the facility's box office for a specified period, typically three
to five years. Pursuant to its agreements with facilities, Ticketmaster Corp.
generally is granted the right to sell tickets for all live events presented
at a facility, and installs the Ticketmaster System in the facility's box
office. Agreements with promoters generally grant Ticketmaster Corp. the right
to sell tickets for all live events presented by that promoter at any
facility, unless the facility is covered by an exclusive agreement with
another automated ticketing service company. The terms of Ticketmaster Corp.'s
agreements with clients are negotiated on a contract-by-contract basis. In the
case of contracts subject to public bid (e.g., by facilities owned or managed

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by municipalities or governmental agencies), the terms are defined, to a
material degree, by the specifications and conditions set forth in the formal
requests for bid.

Pursuant to its client agreements, Ticketmaster Corp. is generally granted
the right to collect from ticket purchasers a per ticket convenience charge on
all tickets sold other than at the box office and an additional per order
handling charge on all tickets sold by Ticketmaster Corp. other than at remote
sales outlets to partially offset the cost of fulfillment. The amount of the
convenience charge is typically determined during the contract negotiation
process, and varies based upon numerous factors, including the services to be
rendered to the client, the amount and cost of equipment to be installed at
the client's box office and the amount of advertising and/or promotional
allowances to be provided, as well as the type of event and whether the ticket
is purchased at a remote sales outlet, by telephone, through the Ticketmaster
Online Web site or otherwise. Any deviations from those amounts for any event
are negotiated and agreed upon by Ticketmaster Corp. and the client prior to
the commencement of ticket sales. During Ticketmaster Corp.'s fiscal 1998, the
convenience charges generally ranged from $1.50 to $7.00 per ticket.
Convenience charges, when added to per order handling charges, averaged
approximately $4.50 per ticket in fiscal 1998. Ticketmaster Corp.'s client
agreements also generally establish the amounts and frequency of any increases
in the convenience charge and handling charge during the term of the
agreement.

The agreements with certain of Ticketmaster Corp.'s clients may provide for
a client to participate in the convenience charges paid by ticket purchasers
for tickets bought through Ticketmaster Corp. for that client's events. The
amount of such participation, if any, is determined by negotiation with that
client. Some agreements also may provide for Ticketmaster Corp. to make
participation advances to the client, generally recoupable by Ticketmaster
Corp. out of the client's future right to participation. In limited cases,
Ticketmaster Corp. makes an upfront, non-recoupable payment to a client for
the right to sell tickets for that client.

Clients are routinely required by contract to include the Ticketmaster name
in print, radio and television advertisements for entertainment events
sponsored by such clients. The Ticketmaster name and logo are also prominently
displayed on printed tickets and ticket envelopes.

Ticketmaster Corp. generally does not buy tickets from its clients for
resale to the public and has no financial risk for unsold tickets. In the
United Kingdom, Ticketmaster Corp. may from time to time buy tickets from its
clients for resale to the public in an amount typically not exceeding
(Pounds)600,000 in the aggregate. Ticket prices are not determined by
Ticketmaster Corp. Ticketmaster Corp.'s clients also generally determine the
scheduling of when tickets go on sale to the public and what tickets will be
available for sale through Ticketmaster Corp. Facilities and promoters, for
example, often handle group and season ticket sales in-house. Ticketmaster
Corp. only sells a portion of its clients' tickets, the amount of which varies
from client to client and varies as to any single client from year to year.

The Company believes that the primary benefits derived by Ticketmaster
Corp.'s clients by use of the Ticketmaster System include (i) centralized
control of total ticket inventory as well as accounting information and market
research data, (ii) centralized accountability for ticket proceeds, (iii)
manageable and predictable transaction costs, (iv) broader and expedited
distribution of tickets, (v) wide dissemination of information about upcoming
events through Ticketmaster Corp.'s call centers, Ticketmaster Online and
other media platforms, (vi) the ability to easily add additional performances
if warranted by demand and (vii) marketing and promotional support.

If an event is canceled, Ticketmaster Corp.'s current policy is to refund
the per ticket convenience charges (but not the handling charge which is
payable with respect to online orders). Refunds of the ticket price for a
canceled event are funded by the client. To the extent that funds then being
held by Ticketmaster Corp. on behalf of the client are insufficient to cover
all refunds, the client is obligated to provide Ticketmaster Corp. with
additional amounts within 24 to 72 hours after a request by Ticketmaster Corp.

Ticketmaster License Agreement

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and certain Ticketmaster Corp. databases to sell live event tickets online for
Ticketmaster Corp.'s clients. In addition, Ticketmaster Corp. authorized
Ticketmaster Online to be Ticketmaster Corp.'s exclusive, perpetual, worldwide
agent for such online ticket sales. The Ticketmaster License Agreement further
provides that Ticketmaster Corp. may use and permit others to use the
Ticketmaster trademark in connection with the online promotion of ticket
sales.

Ticketmaster Corp. is the contracting party with client venues, promoters
and sports franchises, providing ticket inventory management, consumer
information and related data for all ticketing transactions. Ticketmaster
Corp. provides such information to Ticketmaster Online in connection with
processing online live event ticket sales and provides all transaction
processing and fulfillment services for online live event ticket sales.
Ticketmaster Online is required under the Ticketmaster License Agreement to
comply with the terms of Ticketmaster Corp.'s client agreements and
Ticketmaster Online's rights as set forth in the Ticketmaster License
Agreement are subordinated and subject to such agreements. The Ticketmaster
License Agreement also generally restricts Ticketmaster Online from
cooperating with, offering online links to, or entering into any agreements
with venues, ticket sellers or sales agents for online sale of tickets.

Ticketmaster Online Strategic Alliances

Ticketmaster Online participates in certain strategic partnerships with
leading media, marketing and technology partners. The Company believes that
these alliances will assist in the development of compelling content, increase
consumer traffic to the Ticketmaster Online Web site, continue to build the
Ticketmaster Online brand name and expand the Company's promotional
opportunities.

Media Partnerships. Ticketmaster Online creates and acquires entertaining,
informative and timely local content (e.g., live event information, venue
information, articles on live entertainment topics, chat sessions,
entertainment reviews and Webcasts), for use on its Web sites. In this regard,
Ticketmaster Online has entered into agreements with media companies such as
JAM TV and RealTime Sports. These arrangements generally provide for the
development of a co-branded Web presence and links from the co-branded area to
event listings and ticketing and merchandising pages on the Ticketmaster
Online Web site. Ticketmaster Online shares in the advertising and
merchandising revenues generated under the applicable agreement.

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Advertising, Sponsorship and Marketing Partnerships. Ticketmaster Online has
entered into advertising, sponsorship and marketing alliances with Internet
content and service providers and other partners. In addition, Ticketmaster
Corp. has entered into similar agreements pursuant to which Ticketmaster
Online performs services and is allocated a percentage of revenues. For
example, pursuant to an agreement between N2K and TM Ticketing, Ticketmaster
Online and N2K (Music Boulevard) have developed a co-branded presence on the
Web for retailing music products. The agreement is currently subject to
litigation, initiated by TM Ticketing, between the parties. See "Risk
Factors--Potential Governmental Investigations and Litigation." Ticketmaster
Online's other advertisers and marketing partners include Yahoo!, United
Parcel Service of America, Inc., International Business Machines Corporation,
Sprint Communications Company, Ltd., Red Lobster and Ford Motor Company.
Client advertisements and marketing opportunities are typically integrated
into Ticketmaster Online's Web site through banners and links that encourage
viewers to click through for additional information. The Company intends to
continue to pursue such advertising, sponsorship and marketing opportunities.

Technology Partnerships. Ticketmaster Online also participates in certain
arrangements with technology partners to provide enhanced features and
functionality on its Web site. For example, the Company's "my Ticketmaster"
Web site, which Ticketmaster Online is jointly developing with Intel
Corporation and currently anticipates will be launched in the fourth quarter
of 1998, is a personalized Web application designed to enable users to choose
categories of event information they receive based on personal preferences and
habits. This personalized and localized site is currently being designed to
include such features as seating charts (some of which are designed to provide
three-dimensional perspectives) and driving directions to venues.

Marketing and Sales

The Company believes that it will benefit from Ticketmaster Corp.'s
continued promotion of its brand name through Ticketmaster Corp.'s services
and advertising sales force. The Company intends to continue to leverage the
Ticketmaster brand name, Ticketmaster Corp.'s extensive distribution
capabilities and core ticketing services in an effort to offer live event
venues, sports franchises, promoters, advertisers, sponsors and other partners
a wider variety of advertising, promotional and marketing platforms for their
products and services. Through the Company's relationship with Ticketmaster
Corp., advertisers have access to a full array of advertising alternatives,
ranging from online advertising vehicles such as Web sites, banners and
sponsorships to traditional advertising on ticket stock and envelopes, during
telephone sales (e.g., "music on hold" and sales scripts) and through direct
mail campaigns. As of September 30, 1998, the Company had nine employees
dedicated to advertising and promotion of Ticketmaster Online's services.

Operations

Ticketmaster Online's ticketing system interfaces on a real-time basis with
the host ticketing systems developed by Ticketmaster Corp. This process is
designed to ensure that, except in limited circumstances, the inventory of
tickets available online is identical to that which is available through
Ticketmaster's other distribution methods (e.g., telephone call centers and
independent retail outlets) and to enable consumers to order tickets on a
"best available seat" basis. Measures are taken that are designed to prevent
system failure in Ticketmaster Corp.'s computer center. Each system has a live
back-up standing ready in the event of a primary system failure. The rooms
housing the computer-related equipment are protected by computer-safe fire
protection systems. To guard against power outages, uninterruptable power
supplies are utilized. High capacity back-up generators eliminate the
dependency on public electric sources. In addition, all data is continually
recorded on back-up tape.

Ticketmaster Online utilizes Secure Sockets Layer encryption technology
designed to allow users to securely transmit their personal information to the
Ticketmaster Online Web site. The decrypted data is then passed through two
levels of firewalls, using an internally developed communications protocol to
the Ticketmaster Corp. host systems where credit cards are processed and
customer accounts are created. The host systems communicate directly with bank
processing centers for instantaneous online credit card authorization and
electronic deposit of credit card receipts. Essentially, all order processing,
credit card billing, order

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fulfillment and consumer service functions for online ticketing orders are
handled by Ticketmaster Corp. in the same manner as orders which are placed by
telephone.

Technology

Ticketmaster Online has an extensive database of live event information,
with event information updated 12 times every hour and more than 200 times
daily. This data base contains information on more than 30,000 events and over
3,000 clients and is designed to support an easy-to-use and reliable dynamic
event calendar and ticket-buying interface to the Ticketmaster System.

The Ticketmaster Online system is deployed as a multi-tiered system of
servers that separate database functions, Web page serving functions,
transaction processing functions and ticketing system interfacing functions.
The system is built using a combination of commercial and proprietary software
and hardware and is integrated into the Ticketmaster System. All Ticketmaster
Online ticket sales occur on one of 20 geographically dispersed host systems.
Credit card authorization and deposit, inventory control for events, customer
account management and ticket printing and distribution are all handled on the
Ticketmaster System. Internet users interact with various Web servers to find
an event using various criteria including event location, event type, or
performer name. Once an event is located users interact with forms-based HTML
pages to guide them through the ticket-buying process. The Web servers
communicate via a proprietary gateway to the host ticketing systems where the
transaction actually takes place. Since the online ticketing system interfaces
in real-time with the host ticketing systems, except in limited circumstances,
the seats are identical to those available for sale through Ticketmaster
Corp.'s other distribution systems such as call centers, outlets or box
offices.

COMPETITION

The markets for local interactive content and services are highly
competitive. Currently, CitySearch's primary competitors include Digital City,
Inc., a company wholly-owned by America Online, Inc. and Tribune Company and
Microsoft Corporation (Sidewalk). CitySearch also competes against search
engine and other site aggregation companies which primarily serve to aggregate
links to sites providing local content such as Excite, Inc. (City.Net), Lycos,
Inc. (Lycos City Guide) and, while it is also a strategic partner of
Ticketmaster Online, Yahoo! (Yahoo! Local). In addition, CitySearch competes
against offerings from media companies, including Cox Interactive Media, Inc.,
Knight Ridder, Inc. and Zip2 Corporation, as well as offerings from several
telecommunications and cable companies and Internet service providers that
provide local interactive programming such as SBC Communications, Inc. (At
Hand) and MediaOne Group, Inc. (DiveIn). There are also numerous niche
competitors which focus on a specific category or geography and compete with
specific content offerings provided by the Company. The Company may also
compete with online services and other Web site operators, as well as
traditional media such as television, radio and print, for a share of
advertisers' total advertising budgets. The Company faces different
competitors in most of its CitySearch markets. For example, competitors in the
San Francisco Bay Area, the Company's largest market in terms of CitySearch
subscription and services revenues for the six months ended June 30, 1998
(i.e., accounting for 14% of such revenues during such period) primarily
included Microsoft Corporation (Sidewalk), America Online, Inc. (Digital City)
and Yahoo! (SF Bay). Competitors in Raleigh-Durham-Chapel Hill, the Company's
second largest market in terms of subscription and services revenues for the
six months ended June 30, 1998 (i.e., accounting for 13% of such revenues
during such period) primarily included the Web site operated by The Raleigh
News & Observer, WRAL-TV, trianglerestaurants.com, Digital Center
(raleighonline.com), Yahoo! Local and Internet Presentations, Inc.
(citydirect.com). Furthermore, additional major media and other companies with
financial and other resources greater than those of the Company may introduce
new Internet products and services addressing these markets in the future.
There can be no assurance that the Company's competitors will not develop
services that are superior to those of the Company or that achieve greater
market acceptance than the Company's offerings.

The markets for the business of selling live events tickets and related
merchandise is highly competitive and diverse. Ticketmaster Corp.'s and
Ticketmaster Online's competitors include event facilities and promoters that
handle their own ticket sales and distribution through online and other
distribution channels, live event

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automated ticketing companies with Web sites which may or may not currently
offer online transactional capabilities and certain Web-based live event
ticketing companies which only conduct business online. Where facilities and
promoters decide toutilize the services of a ticketing company, Ticketmaster
Corp. and Ticketmaster Online compete with international, national and
regional ticketing services, including TicketWeb, Telecharge (Shubert
Ticketing Services), NEXT Ticketing, Advantix, ETM Entertainment Network,
Dillard's, Prologue, Capital Tickets and Lasergate (Lasergate Systems, Inc.).
Several of Ticketmaster Corp.'s and Ticketmaster Online's competitors have
operations in multiple locations throughout the United States and compete with
Ticketmaster Corp. and Ticketmaster Online on a national level, while others
compete with Ticketmaster Corp. and Ticketmaster Online principally in one
specific geographic region. In certain specific geographic regions, including
certain of the local markets in which CitySearch provides or intends to
provide its local city guide service, one or more of these competitors may
serve as the primary ticketing service in the region. The Company believes
that Ticketmaster Online will experience significant difficulty in
establishing a significant online presence in such regions and, as a result,
any local city guide for such a region may be unable to provide significant
ticketing capabilities. There can be no assurance that one or more of these
regional automated ticketing companies will not expand into other regions or
nationally, which could have a material adverse effect on the Company's
business, financial condition and results of operations.

PROPRIETARY RIGHTS

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may license in the future, certain content, including trademarks and
copyrighted material, from third parties. While the Company attempts to ensure
that the quality of its brands is maintained by such licensees, there can be
no assurance that such licensees will not take actions that might materially
adversely affect the value of the Company's proprietary rights or reputation,
which could have a material adverse effect on the Company's business,
financial condition and results of operations. There can be no assurance that
the steps taken by the Company to protect its proprietary rights will be
adequate or that third parties will not infringe or misappropriate its
copyrights, trademarks, trade dress and similar proprietary rights. In
addition, there can be no assurance that other parties will not assert
infringement claims, including patent infringement claims, against the
Company. The Company licenses the trademark "CitySearch" from a third party,
and there can be no assurance that the Company will be able to continue to
license the trademark on terms acceptable to the Company. The initial term of
the license expires in 2001, subject to renewal at the Company's option. The
licensor of the trademark has filed an application for United States
registration of the CitySearch trademark with the USPTO and has recently
received communications from a third party seeking an extension of the time
period during which third parties may oppose registration of the mark. There
can be no assurance that the USPTO will grant registration of the CitySearch
trademark. The Company licenses the trademark "Ticketmaster" and related
trademarks from Ticketmaster Corp. pursuant to the Ticketmaster License
Agreement. The Company is dependent upon Ticketmaster Corp. to maintain and
assert its rights to the trademarks licensed from Ticketmaster Corp. and
defend infringement claims, if any, relating to the Company's use of such
marks. The Company may be subject to legal proceedings and claims of alleged
infringement of the trademarks and other intellectual property rights of third
parties by the Company and its licensees or licensors. Such claims, even if
not meritorious, could result in the expenditure of significant financial and
managerial resources which could result in a material adverse effect on the
Company's business, financial condition and results of operations.

EMPLOYEES

As of September 30, 1998, the Company employed 608 persons with respect to
the CitySearch business, including 214 persons in functions related to cost of
revenue (including 173 persons in design, content collection, editorial and
photography, 25 persons in customer service and 16 persons in professional
services), 272 persons in sales and marketing, 55 persons in research and
development and 67 persons in general and administrative areas. As of
September 30, 1998, the Company employed 25 persons with respect to the
Ticketmaster Online business, including 11 in advertising and promotion, six
in operations and technical support, five in graphic design and editorial and
content development and three in general and administrative services. None of
the Company's employees is represented by a labor union, and the Company
considers its employee relations to be good.

FACILITIES

The Company's headquarters are located in Pasadena, California, where the
Company currently leases approximately 28,000 square feet under a lease
expiring in 2002. The Company also leases approximately 4,500 square feet in
Austin, 3,900 and 7,880 square feet in Morrisville, North Carolina, 7,900
square feet in Research Triangle Park, North Carolina, 4,600 square feet in
Nashville, 10,000 square feet in New York, 4,700 square feet in Portland,
4,600 square feet in Salt Lake City and 5,800 square feet in San Francisco
under leases which expire in 2002, 2001, 2003, 2003, 2000, 2004, 2002, 2001
and 1999, respectively. Ticketmaster Online leases its principal offices in
Los Angeles, California, as well as office space in additional cities
throughout the United States, the United Kingdom and Canada, in each case on a
month-to-month basis from Ticketmaster Corp. on terms the Company believes are
at least as favorable as those it could obtain from a third party in an arm's-
length transaction. Ticketmaster Online currently occupies an aggregate of
approximately 3,900 square feet of space. The Company believes that its
facilities are adequate in those cities in which the Company currently does
business.

LEGAL PROCEEDINGS

The Company is not currently subject to any material legal proceedings. The
Company may from time to time become a party to various legal proceedings
arising in the ordinary course of business.

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MANAGEMENT

EXECUTIVE OFFICERS AND DIRECTORS

The following table sets forth certain information regarding the executive
officers and directors of the Company as of September 30, 1998:

<TABLE>
<CAPTION>
NAME AGE POSITION
---- --- --------
<C> <C> <S>
Alan Citron............. 40 Chairman of the Board
Charles Conn............ 37 Chief Executive Officer
Thomas Layton........... 35 President, Chief Operating Officer and
Treasurer
Robert Perkins.......... 43 Executive Vice President, Ticketing and
Electronic Commerce
Douglas McPherson....... 36 Chief Legal Officer and Vice President,
Business Development
Bradley Ramberg......... 35 Chief Financial Officer, Vice President,
Finance and Administration and Secretary
Terry Barnes............ 47 Director
Eugene L. Cobuzzi....... 41 Director
Stuart W. DePina(2)..... 38 Director
Barry Diller............ 56 Director
Joseph Gleberman........ 40 Director
William Gross........... 40 Director
Victor A. Kaufman....... 54 Director
Robert Kavner(1)........ 55 Director
William D. Savoy(1)(2).. 33 Director
Alan Spoon.............. 47 Director
Thomas Unterman(2)...... 53 Director
</TABLE>
- --------

(1) Member of the Compensation Committee

(2) Member of the Audit Committee

Mr. Citron has served as Chairman of the Board of the Company since
September 1998 and the President of USA Interactive, a division of USAi, since
July 1998. From June 1997 until July 1998, Mr. Citron served as the President
and Chief Operating Officer of Ticketmaster Online. From January 1995 until
June 1997, Mr. Citron served as Senior Vice President--New Media of
Ticketmaster Corp. From January 1991 until January 1995, Mr. Citron was
employed by the Los Angeles Times, a division of The Times Mirror Company, as
a reporter and business writer and, commencing in 1992, as an assistant
business editor in charge of entertainment.

Mr. Conn has served as Chief Executive Officer of the Company since
September 1998 and served as Chief Executive Officer of CitySearch since he
co-founded CitySearch in September 1995, served as President of CitySearch
from September 1995 to October 1996 and served as a director from September
1995 until September 1998. From September 1990 to September 1995, he was a
consultant at McKinsey & Company, where he was elected Partner. From September
1986 to September 1988, Mr. Conn worked with the Boston Consulting Group in
Boston and Tokyo and in 1989 with Canon, Inc. Mr. Conn holds a B.A. from
Boston University, a B.A. and M.A. from Oxford University, where he was a
Rhodes Scholar, and an M.B.A. from Harvard Business School, where he was a
Baker Scholar.

Mr. Layton has served as President, Chief Operating Officer and Treasurer of
the Company since September 1998. Prior to such time, he served as President
of CitySearch since October 1996 and as Chief Operating Officer and Treasurer
since November 1995. He served as a director of CitySearch from May 1996 to
September 1998.

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<PAGE>

He also served as Vice President, Sales and Marketing from November 1995 to
October 1996. From May 1994 to November 1995, he was with Score Learning
Corporation, a leading educational learning center, where he was promoted from
Chief Financial Officer to President and Chief Operating Officer. From January
1989 to October 1992, Mr. Layton was Vice President and General Manager of the
Western Region for Leasecomm, Inc., a national equipment leasing company, and
was previously with the Boston Consulting Group. Mr. Layton holds a B.S. from
the University of North Carolina at Chapel Hill and an M.B.A. from Stanford
University.

Mr. Perkins has served as Executive Vice President, Ticketing and Electronic
Commerce of the Company since September 1998. From 1982 until September 1998,
he served in a variety of senior management positions with Ticketmaster Corp.,
most recently as Vice President of Ticketmaster Online. Prior to joining
Ticketmaster Corp., Mr. Perkins worked in Venue Management and Sports
Marketing, having directed ticketing for the 1987 Pan Am Games in
Indianapolis, Indiana and serving as Venue Manager for the Olympic Ice Center
at the 1980 Winter Olympics in Lake Placid, New York.

Mr. McPherson has served as Chief Legal Officer and Vice President, Business
Development since September 1998. From July 1996 until September 1998, he
served as Chief Legal Officer and Vice President, Business Development of
CitySearch. From November 1992 to July 1996, Mr. McPherson was with the law
firm of Heller Ehrman White & McAuliffe, where he specialized in intellectual
property law and general commercial litigation. From September 1991 to
September 1992, he served as a law clerk for a federal district judge. From
June 1986 to June 1988, he served as Assistant to the Vice President at The
Rockefeller Foundation in New York City. He holds a B.A. from the University
of North Carolina at Chapel Hill, an M.A. from the University of California,
Berkeley and a J.D. from Stanford Law School.

Mr. Ramberg has served as the Chief Financial Officer, Vice President,
Finance and Administration and Secretary of the Company since September 1998.
From April 1996 when he joined CitySearch until September 1998, he served as
Chief Financial Officer and Vice President, Finance and Administration of
CitySearch and also served as Secretary of CitySearch since February 1998.
From January 1994 to April 1996, he was Vice President of Finance and
Operations at the Fresh Gourmet Company, a joint venture between CPC
International Inc. and Prepco. From December 1992 to January 1994, he was Vice
President, Operations and Finance at Pro-Towel, a start-up consumer products
venture. He holds an A.B. from Brown University and an M.B.A. from Harvard
Business School.

Mr. Barnes has served as a director of the Company since September 1998 and
as the President and Chief Executive Officer of Ticketmaster Corp. since June
1998. From September 1995 until June 1998, Mr. Barnes was the President and
Chief Operating Officer of TM Ticketing Co. From January 1991 until September
1995, Mr. Barnes was Vice President and General Manager of numerous
subsidiaries of Ticketmaster Corp. in the Midwest.

Mr. Cobuzzi has served as a director of the Company since September 1998 and
as the Chief Operating Officer of Ticketmaster Corp. since June 1998. From
February 1997 until June 1998, Mr. Cobuzzi was the Senior Vice President of
Operations for Ticketmaster Corp. From September 1995 until February 1997, Mr.
Cobuzzi served as an Executive Vice President of TM Ticketing Co. From January
1991 until September 1995, Mr. Cobuzzi served as an officer of numerous
subsidiaries of Ticketmaster Corp. in the Northeast. Mr. Cobuzzi, a CPA, began
his career at Ticketmaster Corp. as Controller in August 1985.

Mr. DePina has served as a director of the Company since September 1998 and
as the Chief Financial Officer of Ticketmaster Corp. since June 1998. From
November 1995 until June 1998, Mr. DePina was the Vice President--Finance and
Treasurer of Ticketmaster Group. From August 1984 to November 1995, Mr. DePina
was employed by the public accounting firm of KPMG Peat Marwick LLP serving in
various capacities including, most recently, as a partner.

Mr. Diller has served as a director of the Company since September 1998 and
served as a director of CitySearch from December 1997 until September 1998.
Mr. Diller has been a director and Chairman of the Board and Chief Executive
Officer of USAi since August 1995. He was Chairman of the Board and Chief
Executive

77
<PAGE>

Officer of QVC, Inc., from December 1992 through December 1994. From 1984 to
1992, Mr. Diller served as the Chairman of the Board and Chief Executive
Officer of Fox, Inc. Prior to joining Fox, Inc., Mr. Diller served for ten
years as Chairman of the Board and Chief Executive Officer of Paramount
Pictures Corporation. Mr. Diller is also a director of The Seagram Company
Ltd. He also serves on the Board of the Museum of Television and Radio and is
a member of the Board of Councilors for the University of Southern
California's School of Cinema-Television. Mr. Diller also serves on the Board
of Directors of AIDS Project Los Angeles, the Executive Board for the Medical
Sciences of the University of California, Los Angeles and the Board of the
Children's Advocacy Center of Manhattan.

Mr. Gleberman has served as a director of CitySearch since May 1996 and of
the Company since September 1998. He is a Managing Director in the Principal
Investment Area of Goldman, Sachs & Co., an investment banking firm, a
position which he held since November 1996. He joined Goldman, Sachs & Co. in
1982 and has served as a partner from November 1990 to November 1996. Mr.
Gleberman also serves as a director of Applied Analytical Industries, Inc.,
Biofield Corp. and Dade International, Inc.

Mr. Gross has served as a director of CitySearch since he co-founded it in
September 1995 and of the Company since September 1998. Since March 1996, Mr.
Gross has been Chairman of the Board, Chief Executive Officer and President of
bill gross' idealab!, a corporation which generates ideas for and creates new
companies. In 1991, he founded Knowledge Adventure Inc., a corporation which
developed educational software for children, and served as its Chairman from
June 1991 to January 1997. He was a developer at Lotus Development Corporation
from 1986 to 1991. Prior to joining Lotus Development Corporation, Mr. Gross
founded, in 1980, GNP Loudspeaker, Inc. to manufacture and sell his patented
designs. In 1995, Mr. Gross was elected to the Board of Trustees of California
Institute of Technology as the first Young Alumni Trustee.

Mr. Kaufman has served as a director of the Company since September 1998.
Mr. Kaufman has also served as a director of USAi since December 1996. Mr.
Kaufman has served in the Office of the Chairman of USAi since January 1997
and as its Chief Financial Officer since November 1997. Prior to that time, he
served as Chairman and Chief Executive Officer of Savoy Pictures
Entertainment, Inc. ("Savoy") from March 1992 through December 1996 and as a
director of Savoy from February 1992 through December 1996. Mr. Kaufman was
the founding Chairman and Chief Executive Officer of Tri-Star Pictures, Inc.
("Tri-Star") from 1983 until December 1987, at which time he became President
and Chief Executive Officer of Tri-Star's successor company, Columbia Pictures
Entertainment, Inc. ("Columbia"). He resigned from these positions at the end
of 1989 following the acquisition of Columbia by Sony USA, Inc. Mr. Kaufman
joined Columbia in 1974 and served in a variety of senior positions at
Columbia and its affiliates prior to the founding of Tri-Star.

Mr. Kavner has served as a director of CitySearch since December 1995,
including as Chairman of the Board from March 1996 to September 1998 and as a
director of the Company since September 1998. Mr. Kavner has served as the
Chief Executive Officer, President and a director of On Command Corporation, a
provider of hotel in-room entertainment and movies, since September 1996 and
was a consultant in the area of Internet services and content, interactive
entertainment and telecommunications from September 1995 to August 1996. From
June 1994 to September 1995, Mr. Kavner was the head of Creative Artists
Agency's business advisory group. From 1984 to 1994, Mr. Kavner held a number
of senior executive positions with AT&T, Inc. He also serves as a director of
Fleet Financial Group and Earthlink Networks, Inc.

Mr. Savoy has served as a director of the Company since September 1998.
Since 1990, Mr. Savoy has served as Vice President of Vulcan Ventures,
Incorporated, a venture capital fund. From 1987 until November 1990, Mr. Savoy
was employed by Layered, Inc., and became its President in 1988. Currently,
Mr. Savoy serves as President of Vulcan Northwest, Inc. Mr. Savoy also serves
on the Advisory Board of Dream Works SKG. Mr. Savoy serves as a director of
Cnet, Inc., Harbinger Corporation, Metricom, Inc., Telescan, Inc., United
States Satellite Broadcasting, Inc. and, since July 1997, has served as a
director of USAi.

Mr. Spoon has served as a director of CitySearch since December 1997 and as
a director of the Company since September 1998. Mr. Spoon has been President
of The Washington Post Company since September 1993 and Chief Operating
Officer and a director since May 1991. Prior to that, Mr. Spoon held a wide
variety of

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positions at The Washington Post Company, including President of Newsweek from
September 1989 to May 1991. He is also a director of American Management
Systems, Inc. and Human Genome Sciences, Inc.

Mr. Unterman has served as a director of CitySearch since June 1997 and as a
director of the Company since September 1998. Since March 1998, he has served
as Executive Vice President and Chief Financial Officer and from August 1995
to March 1998, he served as Senior Vice President and Chief Financial Officer
of The Times Mirror Company. From February 1995 to August 1995, Mr. Unterman
was a Senior Vice President and General Counsel and, from September 1992 to
February 1995, was Vice President and General Counsel of The Times Mirror
Company.

BOARD COMPOSITION

The Board of Directors of the Company is currently comprised of 12
directors, none of whom is an officer or employee of the Company. Upon
completion of this offering, pursuant to the Restated Certificate of
Incorporation of the Company, the number of directors of the Company will be
fixed from time to time by resolution of the Board of Directors. All members
of the Board of Directors are elected annually by the stockholders of the
Company. Seven of the Company's current directors are directors, officers or
employees of USAi or Ticketmaster Group. See "Risk Factors--Control By and
Relationship with USAi."

The Board of Directors has a Compensation Committee, comprised of Messrs.
Kavner and Unterman, with Mr. Citron serving as an observer to such Committee.
The Compensation Committee makes recommendations to the Board of Directors
concerning salaries and incentive compensation for officers and employees of
the Company, including equity compensation for senior executives of the
Company. See "Certain Transactions--Transactions with Affiliates." In
addition, the Board of Directors has an Audit Committee, comprised of Messrs.
DePina, Savoy and Unterman, that reviews and monitors corporate financial
reporting and audits of the Company, as well as any other accounting related
matters.

DIRECTOR COMPENSATION

The members of the Board of Directors are not currently compensated for
their services to the Company other than for reimbursement of their expenses
incurred in connection with such services. In March and April 1996, Mr. Kavner
received options to purchase 50,000 shares, 10,000 shares and 81,681 shares of
CitySearch Common Stock (or 50,000 shares, 10,000 shares and 81,681 shares of
Class A Common Stock, respectively, pursuant to the Reclassification) under
the 1996 Stock Plan at an exercise price of $0.10 per share, $0.10 per share
and $0.25 per share, respectively. Upon completion of this offering, directors
may receive discretionary stock option grants pursuant to the provisions of
the 1998 Stock Plan. See "--Employee Benefit Plans."

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

None of the members of the Compensation Committee will be an officer or
employee of the Company. No interlocking relationship will exist between the
Company's Board of Directors or the Compensation Committee and the board of
directors or compensation committee of any other company, nor has such an
interlocking relationship existed in the past.

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<PAGE>

EXECUTIVE COMPENSATION

The following table sets forth certain summary information concerning the
compensation awarded to, earned by or paid for services rendered during the
year ended December 31, 1997 by the Company's Chief Executive Officer and the
one executive officer who earned in excess of $100,000 in compensation during
such year (the "Named Executive Officers").

SUMMARY COMPENSATION TABLE

<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION
--------------
AWARDS
--------------
ANNUAL CITYSEARCH
COMPENSATION SECURITIES
--------------- OTHER ANNUAL UNDERLYING
NAME AND PRINCIPAL POSITION SALARY BONUS COMPENSATION OPTIONS (#)(1)
- --------------------------- ------- ------- ------------ --------------
<S> <C> <C> <C> <C>
Charles Conn....................... $93,333 $40,000 $ -- 125,000
Chief Executive Officer
Thomas Layton...................... 86,667 25,000 -- 75,000
President, Chief Operating Officer
and Treasurer
</TABLE>
- --------

(1) These options were granted pursuant to the 1996 Stock Plan and are options
to purchase Class A Common Stock of the Company. See "Employee Benefit
Plans--1996 Stock Option Plan."

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<PAGE>

OPTION GRANTS IN 1997

The following table sets forth certain information regarding option grants
to each of the Named Executive Officers during the year ended December 31,
1997.

<TABLE>
<CAPTION>
INDIVIDUAL GRANTS(1)
---------------------------------------------------
POTENTIAL REALIZABLE
VALUE AT ASSUMED
NUMBER OF PERCENT OF ANNUAL RATES OF STOCK
SECURITIES TOTAL OPTIONS PRICE APPRECIATION
UNDERLYING GRANTED TO EXERCISE FOR OPTION TERM(4)
OPTIONS EMPLOYEES IN PRICE EXPIRATION ---------------------
NAME GRANTED(#)(1) 1997(2) PER SHARE(3) DATE 5% 10%
---- ------------- ------------- ------------ ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Charles Conn............ 125,000 12.1% $2.00 10/01/07 $1,582,996 $2,669,485
Thomas Layton........... 75,000 7.2% 2.00 10/01/07 949,798 1,601,691
</TABLE>
- --------
(1) All options were granted under the 1996 Stock Plan and are exercisable for
Class A Common Stock of the Company. As of December 31, 1997, 10,416
shares and 6,250 shares subject to the options granted to Messrs. Conn and
Layton were vested, respectively. Prior to the Merger, an additional
20,833 shares and 12,500 shares subject to the options granted to Messrs.
Conn and Layton, respectively, vested. Upon the effectiveness of the
Merger, the remaining 93,751 shares and 56,250 shares subject to the
options granted to Messrs. Conn and Layton, respectively, immediately
vested.

(2) Based on options to purchase 1,035,219 shares granted to CitySearch
employees, including Messrs. Conn and Layton, during the year ended
December 31, 1997 (excluding options to purchase 84,895 shares of
CitySearch Common Stock that were granted to employees and subsequently
canceled during the fiscal year ended December 31, 1997).

(3) The exercise price per share of each option was equal to the fair market
value of the underlying CitySearch Common Stock on the date of grant as
determined by the CitySearch Board of Directors.

(4) Potential gains are calculated based on the assumed initial public
offering price of $9.00 per share of Class B Common Stock net of the
respective exercise price but before taxes associated with the exercise.
The 5% and 10% assumed annual rates of compounded stock appreciation are
mandated by the rules of the Commission and do not represent the Company's
estimate or projection of the future Class B Common Stock price. Actual
gains, if any, on stock option exercises are dependent on the future
market price of shares of Class B Common Stock, the future financial
performance of the Company and overall market conditions.

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<PAGE>

OPTION EXERCISES AND FISCAL YEAR-END VALUES

The following table sets forth the number of shares acquired upon the
exercise of stock options during the year ended December 31, 1997 and the
number of shares covered by both exercisable and unexercisable stock options
held by each of the Named Executive Officers at December 31, 1997.
<TABLE>
<CAPTION>
NUMBER OF SECURITIES
UNDERLYING UNEXERCISED VALUE OF UNEXERCISED
OPTIONS AT YEAR-END IN-THE-MONEY OPTIONS
(#)(1)(2) AT YEAR-END (2)(3)
------------------------- -------------------------
SHARES ACQUIRED VALUE
NAME ON EXERCISE (#) REALIZED EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
---- --------------- -------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Charles Conn............ -- -- 10,416 114,584 $ 72,912 $802,088
Thomas Layton........... -- -- 256,250 68,750 1,793,750 481,250
</TABLE>
- --------
(1) Options shown were granted under the 1996 Stock Plan and are exercisable
for Class A Common Stock. See "Employee Benefit Plans--1996 Stock Option
Plan" for a description of the material terms of these options.

(2) Upon the effectiveness of the Merger, the unvested stock options held by
Mr. Conn and Mr. Layton immediately vested and became fully exercisable.

(3) Based on the assumed initial public offering price of $9.00 per share,
less the exercise price.

EMPLOYMENT AGREEMENTS

On May 9, 1996 and July 2, 1997, CitySearch entered into at-will employment
agreements with each of Messrs. Conn and Layton, respectively. Pursuant to
such employment agreements, in the event that Messrs. Conn's or Layton's, as
the case may be, employment is terminated, he will be entitled to receive
severance payments until the earlier of (i) such time as he is employed by a
recognized company or (ii) six months after termination. Such severance
payments will equal his full salary for the first three months after
termination and half of his salary for the second three months after
termination.

In addition, pursuant to stock option agreements between the Company and
each of Messrs. Conn and Layton, the vesting of such stock options was
accelerated and such stock options fully vested upon completion of the Merger.
Moreover, in connection with the Merger, each of Messrs. Conn and Layton
entered into the Non-Competition Agreements. See "Certain Transactions--
Acceleration of Stock Options" and "--Non-Competition Agreements."

EMPLOYEE BENEFIT PLANS

1996 Stock Option Plan

The Board of Directors of CitySearch adopted and the stockholders approved
the 1996 Stock Plan and the reservation of 2,500,000 shares of Common Stock
thereunder on March 1, 1996. On September 18, 1996, the Board of Directors and
the stockholders of CitySearch approved an increase of 500,000 shares reserved
for issuance under the 1996 Stock Plan. The Board of Directors and the
stockholders of CitySearch approved a further increase of 1,000,000 shares on
November 18, 1996 and November 20, 1996, respectively. Pursuant to the terms
of the 1996 Stock Plan, the Merger and the Reclassification, the CitySearch
Common Stock reserved for issuance under the 1996 Stock Plan has been
reclassified as Class A Common Stock of the Company. As of September 30, 1998,
there were options to purchase an aggregate of 3,890,694 shares of Class A
Common Stock outstanding under the 1996 Stock Plan. Subject to approval by the
stockholders of the Company, the Company amended the 1996 Stock Plan to
increase the number of shares reserved for issuance by 1,500,000 shares of
Class A Common Stock to an aggregate of 5,500,000 shares. The Company does not
intend to grant any additional options under the 1996 Stock Plan following the
consummation of this offering.

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<PAGE>

The 1996 Stock Plan provides for the granting to employees (including
officers and employee directors) of incentive stock options within the meaning
of Section 422 of the Code and for the granting to employees (including
officers and employee directors) and consultants (including non-employee
directors) of nonstatutory stock options.

Unless determined otherwise by the administrator, an option granted under
the 1996 Stock Plan is not transferable by the optionee other than by will or
by the laws of descent or distribution, and is exercisable during the lifetime
of the optionee only by such optionee. Unless otherwise provided by the
administrator, an option granted under the 1996 Stock Plan must be exercised
within three months after termination of the optionee's status as an employee
or consultant of the Company (or within 12 months after termination of such
status by death or disability), but in no event later than the expiration of
the option in accordance with its terms. The shares subject to options granted
under the 1996 Stock Plan may be fully and immediately exercisable or may be
exercisable cumulatively over time or upon satisfaction of specified
performance criteria, as determined by the administrator. In most cases, 25%
of the shares subject to options granted under the 1996 Stock Plan are
exercisable at the end of one year with one forty-eighth of the shares subject
to the option becoming exercisable each month thereafter. The 1996 Stock Plan
provides that in the event of a merger of the Company with or into another
corporation, or a sale of substantially all of the Company's assets, each
option shall be assumed or an equivalent option substituted for by the
successor corporation. If the outstanding options are not assumed or
substituted for by the successor corporation, the administrator shall provide
for the optionee to have the right to exercise the option as to all of the
optioned stock, including shares as to which it would not otherwise be
exercisable. If the administrator makes an option exercisable in full in the
event of a merger or sale of assets, the administrator shall notify the
optionee that the option shall be fully exercisable for a period of 15 days
from the date of such notice, and the option will terminate upon the
expiration of such period.

1998 Stock Option Plan

Subject to approval by the Company's stockholders, the Company intends to
adopt the 1998 Stock Plan and reserve 4,000,000 shares of Class B Common Stock
of the Company for issuance thereunder. The 1998 Stock Plan provides for the
grant of incentive stock options to employees (including officers and employee
directors) and for the grant of nonstatutory stock options and stock purchase
rights ("SPRs") to employees, directors and consultants. Unless terminated
sooner, the 1998 Stock Plan will terminate automatically in September 2008. As
of the date of this Prospectus, no options or SPRs have been granted under the
1998 Stock Plan.

The administrator of the 1998 Stock Plan has the power to determine the
terms of the options or SPRs granted, including the exercise price of the
option or SPR, the number of shares subject to each option or SPR, the
exercisability thereof, and the form of consideration payable upon such
exercise. In addition, the administrator has the authority to amend, suspend
or terminate the 1998 Stock Plan, provided that no such action may affect any
shares of Class B Common Stock previously issued and sold or any option
previously granted under the 1998 Stock Plan. The maximum number of shares
covered by options that each optionee may be granted during a fiscal year is
500,000 shares. In addition, in connection with an optionee's initial
employment with the Company, such optionee may be granted an option covering
an additional 1,000,000 shares.

Options and SPRs granted under the 1998 Stock Plan are generally not
transferable by the optionee, and each option and SPR is exercisable during
the lifetime of the optionee only by such optionee. Options granted under the
1998 Stock Plan generally must be exercised within three months after the end
of the optionee's status as an employee, director or consultant of the
Company, or within 12 months after such optionee's termination by death or
disability, but in no event later than the expiration of the option's term.

In the case of SPRs, unless the administrator determines otherwise, the
restricted stock purchase agreement shall grant the Company a repurchase
option exercisable upon the voluntary or involuntary termination of the
purchaser's employment or consulting relationship with the Company for any
reason (including death or disability). The purchase price for shares
repurchased pursuant to the restricted stock purchase agreement shall be the
original price paid by the purchaser and may be paid by cancellation of any
indebtedness of the purchaser to the Company. The repurchase option shall
lapse at a rate determined by the administrator.

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<PAGE>

The exercise price of all incentive stock options granted under the 1998
Stock Plan must be at least equal to the fair market value of the Class B
Common Stock on the date of grant. The exercise price of nonstatutory stock
options and SPRs granted under the 1998 Stock Plan is determined by the
administrator, but with respect to nonstatutory stock options intended to
qualify as "performance-based compensation" within the meaning of Section
162(m) of the Code, the exercise price must be at least equal to the fair
market value of the Class B Common Stock on the date of grant. With respect to
any participant who owns stock possessing more than 10% of the voting power of
all classes of the Company's outstanding capital stock, the exercise price of
any incentive stock option granted must be at least equal 110% of the fair
market value on the grant date, and the term of such incentive stock option
must not exceed five years. The term of all other options granted under the
1998 Stock Plan may not exceed ten years.

The 1998 Stock Plan provides that in the event of a merger of the Company
with or into another corporation, or a sale of substantially all of the
Company's assets, each option and SPR shall be assumed or an equivalent option
substituted for by the successor corporation. If the outstanding options and
SPRs are not assumed or substituted for by the successor corporation, the
administrator shall provide for the optionee to vest and to have the right to
exercise the option or SPR as to all of the optioned stock, including shares
as to which it would not otherwise be vested or exercisable. If the
administrator makes an option or SPR vested and exercisable in full in the
event of a merger or sale of assets, the administrator shall notify the
optionee that the option or SPR shall be fully exercisable for a period of 15
days from the date of such notice, and the option or SPR will terminate upon
the expiration of such period.

1998 Employee Stock Purchase Plan

Subject to approval by stockholders, the Company plans to adopt the Purchase
Plan and reserve an aggregate of shares of Class B Common Stock
thereunder. The number of shares reserved will be increased automatically each
year on the first day of the Company's fiscal year beginning in 1999 by an
amount equal to the lesser of (i) shares of Class B Common Stock,
(ii) 1.0% of the outstanding shares of Common Stock of the Company on such
date or (iii) a lesser amount determined by the Board of Directors. The
Purchase Plan is intended to qualify as an employee stock purchase plan within
the meaning of Section 423 of the Code. Under the Purchase Plan, the Board of
Directors may authorize participation by eligible employees, including
officers, in periodic offerings following the commencement of the Purchase
Plan. Each offering period will run for months and will be divided into
consecutive purchase periods of approximately months. The initial offering
period under the Purchase Plan will commence on the date of this Prospectus
and terminate on , 1999. Thereafter, new -month offering periods will
commence every months on each and .

Unless otherwise determined by the Board of Directors, employees are
eligible to participate in the Purchase Plan only if they are customarily
employed by the Company or a subsidiary of the Company designated by the Board
of Directors for at least 20 hours per week and for at least five months per
calendar year. Amounts deducted and accumulated by the participant are used to
purchase shares of Class B Common Stock at the end of each purchase period.
Employees who participate in an offering may have up to 15% of their
compensation withheld pursuant to the Purchase Plan. The price of Class B
Common Stock purchased under the Purchase Plan will be equal to 85% of the
fair market value of the Class B Common Stock at the commencement date of each
offering period or the relevant purchase date, whichever is lower. In the
event the fair market value at the end of a purchase period is less than the
fair market value at the beginning of the offering period, the participants
will be withdrawn from the current offering period following exercise and
automatically re-enrolled in a new offering period. The new offering period
will use the lower fair market value as of the first date of the new offering
period to determine the purchase price for future purchase periods. Employees
may end their participation in any offering period at any time during any
offering period, and participation ends automatically on termination of
employment with the Company. The maximum number of shares that a participant
may purchase during each purchase period is shares during any purchase
period. In addition, no person may purchase shares under the Purchase Plan to
the extent such person would own 5% or more of the total combined value or
voting power

84
<PAGE>

of all classes of the capital stock of the Company or any of its subsidiaries,
or to the extent that such person's rights to purchase stock under all
employee stock purchase plans would exceed for any calendar year. The
Purchase Plan will terminate ten years from the date of adoption of the
Purchase Plan, unless terminated earlier in accordance with the provisions of
the Purchase Plan.

In the event of a proposed sale of all or substantially all the assets of
the Company, or the merger of the Company with or into another corporation,
each outstanding option will be assumed or an equivalent option substituted by
the successor corporation. In the event the successor corporation does not
assume or substitute for the option, any offering periods then in progress
shall be shortened to a new date prior to the proposed sale or merger. The
Board of Directors has the authority to amend or terminate the Purchase Plan,
provided, that no such action may adversely affect any outstanding rights to
purchase Class B Common Stock.

USAi Options

In connection with prior employment with Ticketmaster Online certain
employees were previously given options to purchase USAi Common Stock. USAi
has informed the Company that all outstanding options to purchase shares of
USAi Common Stock held by employees of Ticketmaster Online shall remain
outstanding until the earliest to occur of the exercise thereof, the
expiration thereof and the date that the optionholder is no longer an employee
of Ticketmaster Online or another business of the Company, and that the
unvested options shall continue to vest and become exercisable pursuant to the
terms of grant until the earlier of the expiration thereof and the date the
optionholder is no longer an employee of Ticketmaster Online or another
business of the Company.

401(k) Plan

The Company participates in a tax-qualified employee savings and retirement
plan (the "Company 401(k) Plan") which covers all of the Company's full-time
employees who are at least 21 years of age and who have been employed with the
Company for at least three months. Pursuant to the Company 401(k) Plan,
eligible employees may defer up to 20% of their pre-tax earnings, subject to
the Internal Revenue Service's annual contribution limit. The Company 401(k)
Plan permits additional discretionary matching contributions by the Company on
behalf of all participants in the Company 401(k) Plan in such a percentage
amount as may be determined annually by the Board of Directors of the Company.
To date, the Company has made no such matching contributions. The Company
401(k) Plan is intended to qualify under Section 401 of the Code so that
contributions by employees or by the Company to the Company 401(k) Plan, and
income earned on plan contributions, are not taxable to employees until
withdrawn from the Company 401(k) Plan, and so that contributions by the
Company, if any, will be deductible by CitySearch when made. The trustee under
the Company 401(k) Plan, at the direction of each participant, invests the
assets of the Company 401(k) Plan in any of a number of investment options.

Prior to the Merger, the employees of Ticketmaster Online were eligible for
and participated in the Ticketmaster Corp. 401(k) Savings Plan and Trust (the
"Ticketmaster 401(k) Plan"). Pursuant to the terms of the Merger Agreement, it
is anticipated that the Ticketmaster Online employees shall cease
participation in and become ineligible to contribute to the Ticketmaster
401(k) Plan after the effectiveness of the Merger. It is further anticipated
that (i) the Company will accept a spin-off of the Ticketmaster 401(k) Plan as
a trustee-to-trustee transfer with respect to that portion of the Ticketmaster
401(k) Plan which is attributable to the employees of Ticketmaster Online,
(ii) the vested balances of these Ticketmaster Online employees will be
assumed by and transferred into the Company 401(k) Plan, and (iii) the Company
will maintain the level of plan benefits and features required by the Employee
Retirement Income Security Act of 1974, as amended, and the Code in the case
of such spin-offs. In the event that the Company, Ticketmaster Online and
Ticketmaster Corp. determine that such trustee-to-trustee transfer is
inadvisable, adjustments may be made to enable the affected Ticketmaster
Online employees to maintain certain benefits comparable to those previously
afforded such employees and to explore opportunities for such employees to
participate in the 1998 Stock Plan and any other benefits and plans offered or
adopted by the Company (including any welfare and other benefits plans).

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<PAGE>

LIMITATIONS ON LIABILITY AND INDEMNIFICATION MATTERS

The Company's Restated Certificate of Incorporation limits the liability of
directors for breach of fiduciary duty as a director to the maximum extent
permitted by the DGCL. The DGCL provides that a corporation's certificate of
incorporation may contain a provision eliminating or limiting the personal
liability of directors for monetary damages for breach of their fiduciary
duties as directors, except for liability (i) for any breach of their duty of
loyalty to the corporation or its stockholders, (ii) for acts or omissions not
in good faith or which involve intentional misconduct or a knowing violation
of law, (iii) for unlawful payments of dividends or unlawful stock repurchases
or redemptions as provided for in Section 174 of the DGCL or (iv) for any
transaction from which the director derived an improper personal benefit. The
Company's Restated Certificate of Incorporation also provides that the Company
is required to indemnify to the fullest extent permitted by law any director,
officer or employee of the Company.

The Company's Restated Bylaws provide that (i) the Company is required to
indemnify its directors and officers to the maximum extent permitted by the
DGCL, subject to certain very limited exceptions, (ii) the Company may
indemnify its other employees and agents to the maximum extent permitted by
the DGCL, (iii) the Company is required to advance expenses, as incurred, to
its directors and officers in connection with a legal proceeding, subject to
certain very limited exceptions and (iv) the rights conferred in the Restated
Bylaws are not exclusive.

At present, there is no pending litigation or proceeding involving any
director, officer, employee or agent of the Company where indemnification will
be required or permitted. The Company is not aware of any threatened
litigation or proceeding that might result in a claim for such
indemnification.

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PRINCIPAL STOCKHOLDERS

The following tables set forth certain beneficial ownership information with
respect to the Company and USAi, the majority owner of the Company.

COMPANY CLASS B COMMON STOCK

The following table sets forth, as of November 4, 1998, certain information
regarding the beneficial ownership of the Company's Class B Common Stock,
adjusted to reflect the sale of the 7,000,000 shares of Class B Common Stock
offered hereby, by (i) each person or entity who is known by the Company to
own beneficially 5% or more of the Company's outstanding Class B Common Stock;
(ii) each director of the Company; (iii) each of the Named Executive Officers;
and (iv) all directors and executive officers of the Company as a group.

<TABLE>
<CAPTION>
PERCENTAGE OF
TOTAL VOTING
POWER
NUMBER OF PERCENTAGE OF (OF ALL CLASSES)(3)
SHARES SHARES ----------------------
NAME AND ADDRESS BENEFICIALLY BENEFICIALLY BEFORE AFTER
OF BENEFICIAL OWNER(1) OWNED(2) OWNED(2) OFFERING OFFERING
- ---------------------- ------------ ------------- --------- ---------
<S> <C> <C> <C> <C>
USA Networks, Inc................ 42,480,143 85.9% 67.9% 67.4%
152 West 57th Street, 42nd Floor
New York, NY 10019
Barry Diller(4).................. 42,480,143 85.9 67.9 67.4
William Gross(5)................. 3,887,145 35.7 6.2 6.2
Alan Citron...................... -- -- -- --
Terry Barnes..................... -- -- -- --
Eugene L. Cobuzzi................ -- -- -- --
Stuart W. DePina................. -- -- -- --
Joseph Gleberman(6).............. 2,387,981 25.4 3.8 3.8
Victor A. Kaufman................ -- -- -- --
Alan Spoon(7).................... 748,692 19.7 1.2 1.2
Thomas Unterman(8)............... 750,413 9.7 1.2 1.2
Robert Kavner(9)................. 233,783 3.2
William D. Savoy................. -- -- -- --
Charles Conn(10)................. 1,528,821 17.9 2.4 2.4
Thomas Layton(11)................ 963,821 12.1 1.5 1.5
All executive officers and
directors as a group
(17 persons)(12)................ 53,036,925 88.3 84.9 84.3
</TABLE>
- --------
* Less than 1% of the Company's outstanding Class B Common Stock.

** Less than 1% of the total voting power of the Company's outstanding Class
A Common Stock and Class B Common Stock.

(1) The address of Mr. Diller and Mr. Kaufman is: c/o USA Networks, Inc., 152
West 57th Street, 42nd Floor, New York, NY 10019. The address of each of
the other named individuals is: c/o Ticketmaster Online-CitySearch, Inc.,
790 E. Colorado Boulevard, Suite 200, Pasadena, CA 91101.

(2) All numbers shown give effect to the sale of 7,000,000 shares of Class B
Common Stock offered hereby. No shares of Class B Common Stock were
issued or outstanding, and no shares of Class B Common Stock were
beneficially owned, prior to the offering other than shares issuable upon
conversion of the Company's outstanding Class A Common Stock. Pursuant to
the Company's Restated Certificate of Incorporation, shares of Class A
Common Stock are convertible at any time into an equal number of shares
of Class B Common Stock. The percentage of shares beneficially owned
assumes the conversion

87
<PAGE>

of all shares of Class A Common Stock beneficially owned by such listed
person, but does not assume the conversion of Class A Common Stock owned
by any other person. Beneficial ownership is determined in accordance with
the rules of the Commission and generally includes voting or investment
power with respect to securities. Except as indicated by footnote, and
subject to community property laws where applicable, the persons named in
the table above have sole voting and investment power with respect to all
shares of Common Stock shown as beneficially owned by them. Amounts shown
in the above table and the following notes include shares issuable upon
exercise of stock options to purchase shares of Class A Common Stock which
are exercisable within 60 days of November 4, 1998.

(3) Percentage of total voting power of all classes after the offering gives
effect to the sale of 7,000,000 shares of Class B Common Stock offered
hereby. Percent of total voting power before and after the offering is
based on one vote for each share of Class B Common Stock and 15 votes for
each share of Class A Common Stock, calculated assuming no conversion of
the Class A Common Stock by any holder.

(4) Includes 42,480,143 shares of Class A Common Stock which are beneficially
owned by USAi. Mr. Diller disclaims beneficial ownership of such shares.

(5) Includes 1,058,884 shares of Class A Common Stock which Mr. Gross
transferred previously but as to which he retains voting power until the
closing of this offering. Includes 472,562 shares of Class A Common Stock
held by bill gross' idealab!. Mr. Gross disclaims beneficial ownership of
the shares held by bill gross' idealab!. Includes 70,000 shares of Class
A Common Stock that are owned by Mr. Kavner (60,000 shares) and Mr. Conn
(10,000 shares) but for which Mr. Gross has sole voting power until the
closing of the offering.

(6) Includes 2,387,981 shares of Class A Common Stock which are held by
entities affiliated with The Goldman Sachs Group L.P. (the "GS Group").
Mr. Gleberman is a managing director of Goldman, Sachs & Co., the general
partner of which is GS Group. Mr. Gleberman disclaims beneficial
ownership of the shares owned by the GS Group, except to the extent of
his pecuniary interest therein.

(7) Includes 748,692 shares of Class A Common Stock which are held by
Washingtonpost.Newsweek Interactive Company. Mr. Spoon disclaims
beneficial ownership of such shares.

(8) Includes 743,360 shares of Class A Common Stock which are held by The
Times Mirror Company. Mr. Unterman disclaims beneficial ownership of such
shares. Also includes 7,053 shares of Class A Common Stock which are held
by The Thomas and Janet Unterman Living Trust dated 12/30/94.

(9) Includes 115,282 shares of Class A Common Stock and options to purchase
118,501 shares of Class A Common Stock exercisable by Mr. Kavner within
60 days of November 4, 1998. Includes 60,000 shares of Class A Common
Stock that are owned by Mr. Kavner but for which Mr. Gross has sole
voting power until the closing of this offering.

(10) Includes 1,203,821 shares of Class A Common Stock and options to purchase
325,000 shares of Class A Common Stock exercisable by Mr. Conn within 60
days of November 4, 1998. Includes 10,000 shares of Class A Common Stock
that are owned by Mr. Conn but for which Mr. Gross has sole voting power
until the closing of this offering.

(11) Includes 688,821 shares of Class A Common Stock and options to purchase
275,000 shares of Class A Common Stock exercisable by Mr. Layton within
60 days of November 4, 1998.

(12) See notes (2) through (11). Reflects an aggregate of 1,997,502 shares of
Class A Common Stock sold to USAi pursuant to the Tender Offer by such
executive officers (including 382,000 shares sold by Mr. Conn and 240,000
shares sold by Mr. Layton), directors and their affiliated entities.

88
<PAGE>

COMPANY CLASS A COMMON STOCK

The following table sets forth, as of November 4, 1998, certain information
relating to the beneficial ownership of the Company's Class A Common Stock by
(i) each person or entity who is known by the Company to beneficially own 5%
or more of the Company's outstanding Class A Common Stock; (ii) each director
of the Company; (iii) each of the Named Executive Officers; and (iv) all
directors and executive officers of the Company as a group.

<TABLE>
<CAPTION>
NUMBER OF
SHARES PERCENTAGE
NAME AND ADDRESS BENEFICIALLY OF
OF BENEFICIAL OWNER(1) OWNED(2) CLASS(2)
---------------------- ------------ ----------
<S> <C> <C>
USA Networks, Inc................................. 42,480,143 67.9
152 West 57th Street, 42nd Floor
New York, NY 10019
Barry Diller(3)................................... 42,480,143 67.9
William Gross(4).................................. 3,887,145 6.2
Alan Citron....................................... -- --
Terry Barnes...................................... -- --
Eugene L. Cobuzzi................................. -- --
Stuart W. DePina.................................. -- --
Joseph Gleberman(5)............................... 2,387,981 3.8
Victor A. Kaufman................................. -- --
Alan Spoon(6)..................................... 748,692 1.2
Thomas Unterman(7)................................ 750,413 1.2
Robert Kavner(8).................................. 233,783 *
William D. Savoy.................................. -- --
Charles Conn(9)................................... 1,528,821 2.4
Thomas Layton(10)................................. 963,821 1.5
All executive officers and directors as a group
(17 persons)(11)................................. 53,036,925 83.7
</TABLE>
- --------
* Less than 1% of the Company's outstanding Class A Common Stock.

(2) Beneficial ownership is determined in accordance with the rules of the
Commission and generally includes voting or investment power with respect
to securities. Except as indicated by footnote, and subject to community
property laws where applicable, the persons named in the table above have
sole voting and investment power with respect to all shares of Class A
Common Stock shown as beneficially owned by them. Percentage of class is
based on 62,539,744 shares of Class A Common Stock outstanding as of
November 4, 1998. Amounts shown in the above table and the following
notes include shares issuable upon exercise of stock options to purchase
shares of Class A Common Stock which are exercisable within 60 days of
November 4, 1998. Shares of Class A Common Stock may be converted at any
time into an equal number of shares of Class B Common Stock.

(3) Includes 42,480,143 shares of Class A Common Stock beneficially owned by
USAi, as to which Mr. Diller disclaims beneficial ownership.

(4) Includes 1,058,884 shares of Class A Common Stock which Mr. Gross
transferred previously but as to which he retains voting power until the
closing of this offering. Includes 472,562 shares of Class A Common Stock
held by bill gross' idealab!. Mr. Gross disclaims beneficial ownership of
the shares held by bill gross' idealab!. Includes 70,000 shares of Class
A Common Stock that are owned by Mr. Kavner (60,000 shares) and Mr. Conn
(10,000 shares) but for which Mr. Gross has sole voting power until the
closing of the offering.

89
<PAGE>

(5) Includes 2,387,981 shares of Class A Common Stock held by entities
affiliated with the GS Group. Mr. Gleberman is a managing director of
Goldman, Sachs & Co., the general partner of which is GS Group. Mr.
Gleberman disclaims beneficial ownership of the shares owned by the GS
Group, except to the extent of his pecuniary interest therein.

(6) Includes 748,692 shares of Class A Common Stock held by
Washingtonpost.Newsweek Interactive Company, as to which Mr. Spoon
disclaims beneficial ownership.

(7) Includes 743,360 shares of Class A Common Stock held by The Times Mirror
Company, as to which Mr. Unterman disclaims beneficial ownership, and
7,053 shares of Class A Common Stock held by The Thomas and Janet
Unterman Living Trust dated 12/30/94.

(8) Includes 118,501 shares issuable upon exercise of stock options to
purchase shares of Class A Common Stock which are exercisable by Mr.
Kavner within 60 days of November 4, 1998. Includes 60,000 shares of
Class A Common Stock that are owned by Mr. Kavner but for which Mr. Gross
has sole voting power until the closing of this offering.

(9) Includes 325,000 shares issuable upon exercise of stock options to
purchase shares of Class A Common Stock which are exercisable by Mr. Conn
within 60 days of November 4, 1998. Includes 10,000 shares of Class A
Common Stock that are owned by Mr. Conn but for which Mr. Gross has sole
voting power until the closing of this offering.

(10) Includes 275,000 shares issuable upon exercise of stock options to
purchase shares of Class A Common Stock which are exercisable by Mr.
Layton within 60 days of November 4, 1998.

(11) See notes (2) through (10). Reflects an aggregate of 1,997,502 shares of
Class A Common Stock sold to USAi pursuant to the Tender Offer by such
executive officers (including 382,000 shares sold by Mr. Conn and 240,000
shares sold by Mr. Layton), directors and their affiliated entities.

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<PAGE>

USAI COMMON STOCK

The following table sets forth, as of October 30, 1998, information relating
to the beneficial ownership of the USAi Common Stock by (i) each director of
the Company; (ii) the Named Executive Officers of the Company; and (iii) all
executive officers and directors of the Company as a group.

<TABLE>
<CAPTION>
PERCENTAGE OF
TOTAL VOTING
NAME AND ADDRESS NUMBER OF PERCENT POWER
OF BENEFICIAL OWNER(1) SHARES OF CLASS(2) (OF ALL CLASSES)(3)
---------------------- ---------- ----------- -------------------
<S> <C> <C> <C>
Barry Diller(4).................. 59,230,060 34.8% 75.4%
William Gross.................... -- -- --
Alan Citron(5)................... 33,781 * **
Terry Barnes(5).................. 67,561 * **
Eugene L. Cobuzzi(5)............. 84,452 * **
Stuart W. DePina(5).............. 49,771 * **
Joseph Gleberman................. -- -- --
Victor A. Kaufman(6)............. 527,000 * **
Alan Spoon....................... -- -- --
Thomas Unterman.................. -- -- --
Robert Kavner.................... -- -- --
William D. Savoy(7).............. 71,745 * **
Charles Conn..................... -- -- --
Thomas Layton.................... -- -- --
All executive officers and
directors of the Company as a
group (17 persons).............. 60,109,411 35.2% 75.5%
</TABLE>
- --------
* Less than 1% of the outstanding USAi Common Stock.
** Less than 1% of the total voting power of the USAi Common Stock and the
Class B common stock of USAi, par value $.01 per share ("USAi Class B
Common Stock").

(1) The address of Mr. Diller and Mr. Kaufman is: c/o USAi Networks, Inc., 152
West 57th Street, 42nd Floor, New York, NY 10019. The address of each of
the other named individuals is: c/o Ticketmaster Online-CitySearch, Inc.,
790 E. Colorado Boulevard, Suite 200, Pasadena, CA 91101.
(2) The percentage of beneficial ownership listed assumes the conversion of
any shares of USAi Class B Common Stock owned by such listed person, but
does not assume the conversion of USAi Class B Common Stock owned by any
other person. Beneficial ownership has been determined in accordance with
the rules of the Commission. Shares of USAi Class B Common Stock are
convertible at any time into an equal number of shares of USAi Common
Stock.
(3) The percentage of votes for all classes is based on one vote for each
share of USAi Common Stock and ten votes for each share of USAi Class B
Common Stock (assuming no conversion of USAi Class B Common Stock).

(4) Liberty, a wholly-owned subsidiary of TCI, Universal, Seagram, USAi and
Mr. Diller are parties to a stockholders agreement (the "Stockholders
Agreement") pursuant to which Liberty and Mr. Diller have formed BDTV
INC., BDTV II INC., BDTV III INC. and BDTV IV INC. (together the "BDTV
Entities") which entities hold 4,000,000, 15,618,222, 4,005,182 and
800,000 shares of USAi Class B Common Stock, respectively. Includes
6,380,000 shares of USAi Class B Common Stock, and 7,120,000 shares of
USAi Common Stock as to which Mr. Diller has general voting power and
which are otherwise beneficially owned by Seagram. Includes 378,322
shares of USAi Class B Common Stock, and 4,820,587 shares of USAi Common
Stock as to which Mr. Diller has general voting power and which are
otherwise beneficially owned by Liberty. Mr. Diller also owns through
intermediate entities 973,954 shares of USAi Common Stock and vested
options to purchase 15,133,771 shares of USAi Common Stock. Pursuant to
the Stockholders Agreement, Mr. Diller generally has the right to vote
all of the shares of USAi stock held by the BDTV Entities, Seagram and
Liberty. These figures do not include any unissued shares of USAi Common
Stock or

91
<PAGE>

USAi Class B Common Stock issuable upon exchange of the shares of Home
Shopping Network, Inc. ("Home Shopping") held by Liberty HSN, Inc.
("Liberty HSN") and the shares of USANi LLC ("LLC Shares") beneficially
owned by Liberty or Seagram.

(5) Consists solely of vested options to purchase shares of USAi Common Stock.

(6) Consists of 210,000 shares of USAi Common Stock and vested options to
purchase 317,000 shares of USAi Common Stock.

(7) Consists of 29,000 shares of USAi Common Stock and vested options to
purchase 42,745 shares of USAi Common Stock.

USAI CLASS B COMMON STOCK

The following table sets forth, as of October 30, 1998, information relating
to the beneficial ownership of USAi Class B Common Stock for the individuals
described in the table regarding ownership of USAi Common Stock.

<TABLE>
<CAPTION>
NUMBER OF
SHARES
NAME AND ADDRESS BENEFICIALLY PERCENTAGE
OF BENEFICIAL OWNER OWNED(1) OF CLASS
- ------------------- ------------ ----------
<S> <C> <C>
Barry Diller(2)......................................... 31,181,726 100%
c/o USA Networks, Inc.
152 West 57th Street
42nd Floor
New York, NY 10019
</TABLE>
- --------
(1) All or any portion of shares of USAi Class B Common Stock may be converted
at any time into an equal number of shares of USAi Common Stock.
(2) These figures do not include any unissued shares of USAi Common Stock or
USAi Class B Common Stock issuable upon conversion of Liberty HSN's Home
Shopping shares and LLC Shares beneficially owned by Liberty or Seagram.

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<PAGE>

TICKETMASTER ONLINE-CITYSEARCH MERGER

MERGER AGREEMENT

On September 28, 1998, pursuant to the Merger Agreement, the Merger was
consummated and Ticketmaster Online became a wholly-owned subsidiary of the
Company. Immediately prior to the Merger, all of the outstanding shares of
CitySearch Convertible Preferred Stock were converted into shares of
CitySearch Common Stock and all outstanding options or warrants to purchase
shares of CitySearch Convertible Preferred Stock were converted into options
or warrants to purchase shares of CitySearch Common Stock. At the effective
time of the Merger, the outstanding capital stock of Ticketmaster Online was
converted into an aggregate of 37,238,000 shares of CitySearch Common Stock
which, pursuant to the Reclassification, was subsequently converted into Class
A Common Stock. In addition, all outstanding options or warrants exercisable
for shares of CitySearch Common Stock became exercisable for shares of Class A
Common Stock (according to their existing vesting schedule and other terms).
The following is a summary of certain aspects of the Merger Agreement, the
Merger and related transactions and is qualified in its entirety by reference
to the Merger Agreement and the exhibits thereto, copies of which have been
filed as exhibits to the Registration Statement of which this Prospectus is a
part.

Tender Offer

Pursuant to the terms of the Merger Agreement, on October 2, 1998, USAi
commenced the Tender Offer to purchase from each Current CitySearch Holder up
to 20% of each such holder's shares of Common Stock (including shares of
Common Stock issuable upon exercise of options or warrants that were vested
and exercisable as of the effective time of the Merger) at a per share price
of $8.67 net to the seller in cash. USAi purchased 1,997,502 shares of Class A
Common Stock pursuant to the Tender Offer, which was completed on November 3,
1998.

Put Option

The Merger Agreement provides that, in the event that the Company does not
close a Qualified IPO (as defined below) prior to any of the dates that are 12
months, 18 months and 24 months from the date of the Merger Agreement, then
during the 45-day period beginning on such dates, a majority in interest of
the Current CitySearch Holders may, upon notice to USAi, require USAi to
commence an exchange offer (the "Put Option"), consummation of which would be
subject to certain conditions, including that a minimum of 50.1% (on a fully
diluted basis) of the then-outstanding Common Stock held by Current CitySearch
Holders is tendered therein, for all shares of Common Stock then held by any
Current CitySearch Holder for consideration of (a) 0.1548 shares of USAi
Common Stock plus (b) at the election of USAi, either (i) $4.34 in immediately
available funds or (ii) a number of additional shares of USAi Common Stock
equal to $4.34 divided by the average closing price of a share of USAi Common
Stock for the 20 consecutive trading days ending on the date five days prior
to the date of the applicable notice, as reported on the Nasdaq National
Market or the New York Stock Exchange, as the case may be. Any such exchange
offer would be subject to certain conditions, including that a minimum of
50.1% (on a fully diluted basis) of the then-outstanding Common Stock held by
Current CitySearch Holders is tendered therein. A "Qualified IPO" is defined
in the Merger Agreement as an underwritten public offering of the Company's
Common Stock pursuant to a registration statement declared effective by the
Commission under the Securities Act, involving the offer and sale of shares of
the Company's Common Stock either (x) equal in number to 10% of the number of
all shares of outstanding Common Stock of all classes at the time of such
closing or (y) at an aggregate offering price (after deduction of underwriter
commissions and offering expenses) of not less than $75 million. For all
purposes under the Merger Agreement, a Qualified IPO shall have occurred if an
underwritten public offering meeting the criteria specified in the immediately
preceding sentence is consummated and one of the investment banking
institutions specified on a list agreed to by CitySearch and USAi is a
managing underwriter (or the sole underwriter) of such underwritten public
offering.

Based upon the number of shares of Class B Common Stock being offered
hereby, and the expected initial public offering price of such shares, this
offering, upon closing, will constitute a Qualified IPO. As a result, the

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<PAGE>

Put Option, as well as the other rights granted to the Current CitySearch
Holders in the Merger Agreement that terminate or expire upon the closing of a
Qualified IPO (including, without limitation, the right to nominate four
persons as directors on the Company's Board of Directors and certain Company
actions requiring supermajority board approvals), will terminate or expire, as
the case may be, upon the closing of this offering.

Indemnification by USAi

Pursuant to the Merger Agreement, USAi has agreed to indemnify each of the
Current CitySearch Holders and hold them harmless against any loss, loss of
value, liability, demand, claim, action or expense which any such person or
entity may suffer or become subject to as a result of a breach of certain
representations and warranties made by USAi, Ticketmaster Group, Ticketmaster
Corp. and Ticketmaster Online relating to Ticketmaster Corp. venue agreements
and Ticketmaster Online financial statements.

CONVERTIBLE NOTE

Concurrently with the execution of the Merger Agreement, USAi loaned $50
million in cash to CitySearch in exchange for the Convertible Note. The
Convertible Note, in the principal amount of $50 million, bears interest at a
rate per annum of 7.00%. Following consummation of the Merger, the Convertible
Note is convertible only upon the expiration of the final put right described
above under "Ticketmaster Online-CitySearch Merger" (if no Qualified IPO has
occurred) into that number of shares of Class A Common Stock equal to the
outstanding principal amount and any accrued and unpaid interest (which
interest has been outstanding for a period longer than one year) divided by
$7.33. Upon completion of this offering, which will result in the termination
of the Put Option, the Convertible Note and any remaining outstanding
principal or accrued interest thereon will no longer be convertible into
capital stock of the Company. The Convertible Note is generally due and
payable on the earlier to occur of (a) August 13, 2005 or (b) 20 days
following the closing of a Qualified IPO, which, as described above, would
include this offering. In the event that a Qualified IPO results in net cash
proceeds to the Company less than the aggregate amount of the outstanding
principal and accrued interest under the Convertible Note, the Company will be
required to pay USAi an amount equal to such net cash proceeds, with payment
of such proceeds first applied against the accrued and unpaid interest and
then to outstanding principal. See "Use of Proceeds."

TICKETMASTER LICENSE AGREEMENT

Concurrently with the execution of the Merger Agreement, Ticketmaster
Corp.,Ticketmaster Online and USAi entered into the Ticketmaster License
Agreement, which is described under "Business--Ticketmaster Online Business--
Ticketmaster License Agreement."

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<PAGE>

CERTAIN TRANSACTIONS

PRIVATE PLACEMENTS OF SECURITIES

On September 22, 1995, CitySearch issued an aggregate of 6,622,857 shares of
CitySearch Common Stock to Mr. Gross, a co-founder of CitySearch and director
of the Company, for services provided to CitySearch and aggregate proceeds of
$5,000. On December 9, 1995, CitySearch repurchased 2,000,000 shares of such
CitySearch Common Stock from Mr. Gross for an aggregate price of $1,510. On
October 11, 1995 CitySearch sold an aggregate of 4,233,500 shares of
CitySearch Common Stock to Messrs. Conn, Layton, Jeffrey Brewer and certain
other key employees (together with shares of CitySearch Common Stock issued to
Mr. Gross, the "Founders' Stock") for aggregate proceeds of $84,670. Pursuant
to the Reclassification, the Founders' Stock has been reclassified as Class A
Common Stock of the Company. Pursuant to the terms of the applicable
subscription agreement, Founders' Stock may not be transferred, prior to the
closing of a Qualified IPO, without the written consent of the Board of
Directors. To date, 1,178,234 shares of Founders' Stock have been transferred
by Mr. Gross and certain key employees with the approval of the Board of
Directors of CitySearch. However, Mr. Gross retains voting power over all of
shares transferred by him until the closing of this offering.

Between May 15, 1996 and July 31, 1996, CitySearch issued and sold an
aggregate of 3,261,024 shares of Series C Preferred Stock (or 3,170,356 shares
of Class A Common Stock pursuant to the Conversion and the Reclassification)
at a per share price of $3.4665. Entities affiliated with Goldman, Sachs & Co.
purchased 2,596,278 shares of these shares (or 2,465,686 shares of Class A
Common Stock pursuant to the Conversion and the Reclassification) for an
aggregate purchase price of approximately $9.0 million. Mr. Gleberman, a
director of the Company, is a Managing Director in the Principal Investment
Area of Goldman, Sachs & Co.

Between December 13, 1996 and October 22, 1997, CitySearch issued and sold
an aggregate of 4,430,313 shares of Series D Preferred Stock (or 4,297,824
shares of Class A Common Stock pursuant to the Conversion and the
Reclassification) at a per share price of $6.5251. These sales included the
following: 766,272 shares (or 743,360 shares of Class A Common Stock pursuant
to the Conversion and the Reclassification) were sold to The Times Mirror
Company for an aggregate purchase price of approximately $5.0 million; 475,085
shares (or 460,873 shares of Class A Common Stock pursuant to the Conversion
and the Reclassification) were sold to entities affiliated with Goldman, Sachs
& Co. for an aggregate purchase price of approximately $3.1 million; and
459,763 shares (or 446,015 shares of Class A Common Stock pursuant to the
Conversion and the Reclassification) were sold to Washingtonpost.Newsweek
Interactive Company for an aggregate purchase price of approximately $3.0
million. Mr. Unterman, a director of the Company, is an Executive Vice
President and Chief Financial Officer of The Times Mirror Company.
Mr. Gleberman, a director of the Company, is Managing Director in the
Principal Investment Area of Goldman, Sachs & Co. Mr. Spoon, a director of the
Company, is President, Chief Operating Officer and a director of The
Washington Post Company.

Between November 11, 1997 and November 26, 1997, CitySearch issued and sold
an aggregate of 4,655,347 shares of Series E Preferred Stock (or 4,714,286
shares of Class A Common Stock pursuant to the Conversion and the
Reclassification) at a per share price of $7.00. USAi purchased 2,857,143 such
shares (2,821,428 shares of Class A Common Stock pursuant to the Conversion
and the Reclassification) for an aggregate purchase price of approximately
$20.0 million. Mr. Diller, a director of the Company, is Chairman and Chief
Executive Officer of USAi. In addition, 306,509 shares (or 302,677 shares of
Class A Common Stock pursuant to the Conversion and the Reclassification) were
sold to Washingtonpost.Newsweek Interactive Company for an aggregate purchase
price of approximately $2.1 million.

On May 26, 1998, CitySearch issued and sold an aggregate of 1,000,000 shares
of Series E Preferred Stock (or 987,500 shares of Class A Common Stock
pursuant to the Conversion and the Reclassification) at a per share price of
$7.00. USAi purchased 428,571 of these shares (or 423,213 shares of Class A
Common Stock pursuant to the Conversion and the Reclassification) for an
aggregate purchase price of approximately $3.0 million.

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TRANSACTIONS WITH AFFILIATES

USAi, Ticketmaster Corp. and Related Entities

In May 1997, CitySearch entered into a cross-promotional agreement with
Ticketmaster Online. Pursuant to the agreement, Ticketmaster Online agreed to
provide banner advertising promoting CitySearch's owned and operated city
sites on the Ticketmaster Online Web site, to provide access to Ticketmaster
Online ticket and information Web pages and to provide "music-on-hold" and/or
direct mail opportunities from Ticketmaster Corp. CitySearch agreed to provide
promotion of the Ticketmaster name and logo in selected advertising and
marketing materials, to co-produce with Ticketmaster Online broadcast
advertising, to provide banner advertising promoting Ticketmaster Online on
the CitySearch Web sites and to promote Ticketmaster Corp. events and
publications. This agreement terminates on October 31, 1998.

CitySearch, USAi, Ticketmaster Online and various affiliates are parties to
the Merger Agreement. In addition, pursuant to the Merger Agreement, the
Tender Offer was completed on November 3, 1998. Concurrently with the
execution of the Merger Agreement, USAi loaned $50 million in cash to
CitySearch in exchange for the Convertible Note. See "Ticketmaster Online-
CitySearch Merger--Merger Agreement."

In August 1998, Ticketmaster Online, Ticketmaster Corp. and USAi entered
into the Ticketmaster License Agreement. See "Business--Ticketmaster Online
Business--Ticketmaster License Agreement."

The Company expects that, both within and outside the ordinary course of
business, the Company and its affiliates (other than USAi and its controlled
affiliates), on the one hand, and USAi and its affiliates (other than the
Company and its controlled affiliates), on the other hand, will engage in
various transactions, including pursuant to the Ticketmaster License
Agreement. The Company expects that such transactions will result in terms to
the Company that are at least as favorable as those that could be obtained
from a third party, where applicable.

Other Affiliates

In June 1997, CitySearch entered into a license and services agreement with
the Los Angeles Times, a division of The Times Mirror Company. The agreement
provides for the license of CitySearch's intellectual property and consulting
services in exchange for an up-front license fee, ongoing royalties based on
the revenues generated by the city guide developed by the parties and fees for
consulting services. The agreement contains customary termination provisions
for material breach or non-performance. Mr. Unterman, a director of the
Company, is Executive Vice President and Chief Financial Officer of The Times
Mirror Company.

In September 1997, Ticketmaster Online entered into an agreement with The
Los Angeles Times, Inc. providing for Ticketmaster Online to create and
maintain a co-branded Web site with ticketing capabilities and information on
local live events. Under the agreement, Ticketmaster Online is required to pay
to The Los Angeles Times, Inc. 50% of net merchandising revenue from the co-
branded Web site.

In November 1997, CitySearch entered into a license and services agreement
with Washingtonpost.Newsweek Interactive Company. The agreement provides for
the license of the Company's intellectual property and consulting services in
exchange for an up-front license fee, ongoing royalties based on the revenues
generated by the city guide developed by the parties and fees for consulting
services. The agreement contains customary termination provisions for material
breach or non-performance. Mr. Spoon, a director of the Company, is the
President and a director of The Washington Post Company, the parent of
Washington-post.Newsweek Interactive Company.

ACCELERATION OF STOCK OPTIONS

Messrs. Conn and Layton are parties to stock option agreements under the
1996 Stock Plan pursuant to which Mr. Conn was granted options to purchase
125,000 shares and 200,000 shares of CitySearch Common Stock at exercise
prices of $2.00 per share and $7.00 per share, respectively, and Mr. Layton
was granted options

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to purchase 75,000 shares and 200,000 shares of CitySearch Common Stock at
exercise prices of $2.00 per share and $7.00 per share, respectively. Each of
these stock option agreements provides that in the event of a substantial
merger or a board approved acquisition of CitySearch, all outstanding,
unvested stock options will vest upon completion of such event. Upon
consummation of the Merger, 277,085 shares subject to unvested options held by
Mr. Conn and 239,584 shares subject to unvested options held by Mr. Layton
immediately vested. Pursuant to terms of the stock option agreements, the
Merger and the Reclassification, these options are exercisable for Class A
Common Stock.

NON-COMPETITION AGREEMENTS

In connection with the execution of the Merger Agreement, Messrs. Conn and
Layton each entered into the Non-Competition Agreements with CitySearch,
Ticketmaster Corp. and Ticketmaster Online.

The Non-Competition Agreements provide that each of Messrs. Conn and Layton
will not, for a period of 30 months from the date of the Non-Competition
Agreement, directly engage in or assist any activity that is the same or
materially competes with the local city guide business on the Web or the
business of the sale of tickets to live events through any distributed
channels. Messrs. Conn and Layton each received $250,000 from Ticketmaster
Group in connection with the execution of his Non-Competition Agreement. In
addition, neither Messrs. Conn nor Layton may solicit senior employees or
customers, advertisers or clients of CitySearch or Ticketmaster Online or any
of their respective subsidiaries for a period of one year following the date
of the termination of his employment with CitySearch for any reason.

The Company has also entered into employment agreements with each of Messrs.
Conn and Layton, which provide for certain severance payments upon termination
of employment. See "Management--Employment Agreements."

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DESCRIPTION OF CAPITAL STOCK

The following summary of the terms of the Company's capital stock is
qualified in its entirety by reference to the applicable provisions of
Delaware law and the Company's Restated Certificate of Incorporation and
Restated Bylaws.

As of September 30, 1998, there were 62,486,478 shares of Class A Common
Stock outstanding, held of record by 298 stockholders of the Company, and
options to purchase 3,890,694 shares of Class A Common Stock outstanding.

COMMON STOCK

Upon the closing of this offering, the Company will be authorized to issue
100,000,000 shares of Class A Common Stock, 250,000,000 shares of Class B
Common Stock and 2,883,506 shares of Class C Common Stock. The Class A Common
Stock, Class B Common Stock and Class C Common Stock will have the following
rights, preferences and privileges:

Class A Common Stock

Except as otherwise provided by the Restated Certificate of Incorporation or
by applicable law, each share of Class A Common Stock issued and outstanding
shall have 15 votes on any matter submitted to a vote of stockholders.
Pursuant to the Reclassification, each share of CitySearch Common Stock
outstanding immediately prior to the Reclassification was reclassified on a
one-for-one basis as Class A Common Stock of the Company. Each share of Class
A Common Stock will be automatically converted into one share of Class B
Common Stock of the Company upon any Transfer of such share, whether or not
for value by the initial registered holder (the "Initial Holder") thereof,
other than any such Transfer by such holder to (i) a nominee of such holder
(without any change in beneficial ownership, within the meaning of Section
13(d) of the Securities and Exchange Act of 1934, as amended (the "Exchange
Act")) or (ii) another person that, at the time of the Transfer, beneficially
owns shares of Class A Common Stock or a nominee thereof; provided that,
notwithstanding the foregoing (A) any Transfer by the Initial Holder without
consideration to (i) any affiliated entity of such Initial Holder, (ii) a
partner, active or retired, of such Initial Holder, (iii) the estate of any
such Initial Holder or a trust established for the benefit of the descendants
or any relatives or spouse of such Initial Holder, (iv) a parent corporation
or wholly-owned subsidiary of such Initial Holder or to a wholly-owned
subsidiary of such parent unless and until such transferee ceases to be a
parent or wholly-owned subsidiary of the Initial Holder or a wholly-owned
subsidiary of such parent, or (v) the spouse of such Initial Holder, in each
case, shall not result in such conversion, or (B) any bona fide pledge to a
financial institution in connection with a borrowing shall not result in such
conversion; and provided further, that in the event any Transfer shall not
give rise to automatic conversion hereunder, then any subsequent Transfer by
the holder (other than any such Transfer by such holder to a nominee of such
holder (without any change in beneficial ownership, as such term is defined
under Section 13(d) of the Exchange Act)) or the pledgor, as the case may be,
shall be subject to automatic conversion upon such terms and conditions. In
addition, each share of Class A Common Stock may be converted at any time into
one share of Class B Common Stock at the option of the holder thereof. The
one-to-one conversion ratio shall be in all events equitably preserved in the
event of any merger, consolidation or other reorganization of the Company with
another corporation.

Pursuant to the terms of conversion described above, shares of Class A
Common Stock purchased by USAi pursuant to the Tender Offer did not convert to
Class B Common Stock and remained shares of Class A Common Stock. See
"Ticketmaster Online-CitySearch Merger--Merger Agreement--Tender Offer."

Pursuant to the terms of the 1996 Stock Plan, as amended, and the
Reclassification, all outstanding options as of September 30, 1998 are
exercisable for shares of Class A Common Stock, and no additional options will
be granted under the 1996 Stock Plan. See "Management--Employee Benefit
Plans--1996 Stock Option Plan."

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Class B Common Stock

Except as otherwise provided by applicable law, each share of Class B Common
Stock issued and outstanding shall have one vote on any matter submitted to a
vote of stockholders. The Restated Certificate of Incorporation provides that
the Company shall at all times reserve and keep available out of its
authorized but unissued shares of Class B Common Stock, solely for the purpose
of effecting the conversion of the shares of the Class A Common Stock, such
number of its shares of Class B Common Stock as shall be necessary to effect
the conversion of all outstanding shares of Class A Common Stock. Except as
otherwise required by applicable law, the Class A Common Stock and the Class B
Common Stock shall vote together as a single class on all matters submitted to
a vote of stockholders.

Class C Common Stock

No shares of Class C Common Stock issued and outstanding shall have any vote
on any matter submitted to a vote of stockholders, except as otherwise
required by applicable law. The Class C Common Stock is reserved for issuance
upon conversion of the Convertible Note held by USAi in certain limited
circumstances, as described in the Convertible Note. See "Ticketmaster Online-
CitySearch Merger--Convertible Note."

Except as set forth in the Company's Restated Certificate of Incorporation
and summarized in this Prospectus, with respect to voting rights, conversion
and transfer, and except as otherwise provided by applicable law, the Class A
Common Stock, Class B Common Stock and the Class C Common Stock have identical
rights, preferences and privileges. As such, subject to preferences that may
apply to shares of Preferred Stock outstanding from time to time, the holders
of outstanding shares of Common Stock of the Company are entitled to receive,
on a share-for-share basis, such dividends if, as and when declared from time
to time by the Board of Directors of the Company. Cumulative voting for the
election of directors is not provided for in the Company's Restated
Certificate of Incorporation; therefore, subject to applicable law, the
holders of a majority of the total voting power of the outstanding shares of
Common Stock voted will have the power to elect all of the directors then
standing for election. No class of Common Stock is entitled to preemptive or
redemption rights. Upon a liquidation, dissolution or winding-up of the
Company, the assets legally available for distribution to stockholders are
distributable ratably among the holders of each class of Common Stock, subject
to the preferences, if any, of any outstanding Preferred Stock and payment of
claims of creditors. The Company's Restated Certificate of Incorporation
further provides that in no event will any stock dividends or stock splits or
combinations of stock be declared or made on Class A Common Stock, Class B
Common Stock or Class C Common Stock unless all shares of Class A Common
Stock, Class B Common Stock and Class C Common Stock then outstanding are
treated equally and identically. Each outstanding share of Common Stock of the
Company is, and all shares of Common Stock to be outstanding upon completion
of this offering will be, fully paid and nonassessable.

PREFERRED STOCK

Upon the closing of this offering, the Company will be authorized to issue
2,000,000 shares of Preferred Stock. The Board of Directors is authorized,
subject to limitations prescribed by Delaware law, to provide for the issuance
of shares of Preferred Stock in one or more series, to establish from time to
time the number of shares to be included in each such series, to fix the
powers, designations, preferences and rights of the shares of each wholly
unissued series and designate any qualifications, limitations or restrictions
thereon and to increase or decrease the number of shares of any such series
(but not below the number of shares of such series then outstanding) without
any further vote or action by the stockholders. The issuance of Preferred
Stock may have the effect of delaying, deferring or preventing a change in
control of the Company and may adversely affect the voting and other rights of
the holders of Common Stock of the Company, which could have an adverse impact
on the market price of the Class B Common Stock. The Company has no current
plan to issue any shares of Preferred Stock.

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WARRANTS

In November 1997, as additional consideration for service rendered by
NationsBanc Montgomery Securities LLC as placement agent for the Series E
Preferred Stock, CitySearch issued to NationsBanc Montgomery Securities LLC a
warrant to purchase 94,286 shares of Series E Preferred Stock (or 93,107
shares of Class A Common Stock pursuant to the Conversion and the
Reclassification). The warrant is exercisable at any time at an exercise price
of $8.86 per share of Class A Common Stock. Any unexercised portion of the
warrant is automatically convertible into Class A Common Stock immediately
prior to the closing of this offering for that number of shares of Class A
Common Stock equal to (x) the value of the unexercised portion as of the date
of the closing of this offering, which value shall equal the difference
between the aggregate exercise price and the aggregate value of the shares of
Class A Common Stock issuable upon exercise of the unexercised portion of the
warrant, at a per share price equal to the initial offering price divided by
(y) the per share initial offering price of the shares of Class B Common Stock
to be issued and sold in this offering.

CORPORATE OPPORTUNITIES

The Company's Restated Certificate of Incorporation will provide that "USA
Networks" (for purposes of this section only, as defined below) shall have no
duty to refrain from engaging in the same or similar activities or lines of
business as the Company, and neither USA Networks nor any officer, director or
employee thereof (except as described below) shall be liable to the Company or
its stockholders for breach of any fiduciary duty by reason of any such
activities of USA Networks. In the event that USA Networks acquires knowledge
of a potential transaction or matter which may be a corporate opportunity for
both USA Networks and the Company, USA Networks shall have no duty to
communicate or offer such corporate opportunity to the Company and shall not
be liable to the Company or its stockholders for breach of any fiduciary duty
as a stockholder of the Company by reason of the fact that USA Networks
pursues or acquires such corporate opportunity for itself, directs such
corporate opportunity to another person, or does not communicate information
regarding such corporate opportunity to the Company. Nothing in this provision
of the Company's Restated Certificate of Incorporation shall amend or modify
in any respect any written contractual agreement between USA Networks and the
Company.

In the event that a director or officer of the Company who is also a
director, officer or employee of USA Networks acquires knowledge of a
potential transaction or matter which may be a corporate opportunity for both
the Company and USA Networks, such director or officer of the Company shall
have fully satisfied and fulfilled the fiduciary duty of such director or
officer to the Company and its stockholders with respect to such corporate
opportunity, if such director or officer acts in a manner consistent with the
following policy:

(i) a corporate opportunity offered to any person who is an officer of
the Company, and who is also a director but not an officer or employee of
USA Networks, shall belong to the Company;

(ii) a corporate opportunity offered to any person who is a director but
not an officer of the Company, and who is also a director, officer or
employee of USA Networks shall belong to the Company if such opportunity is
expressly offered to such person in his or her capacity as a director of
the Company, and otherwise shall belong to USA Networks; and

(iii) a corporate opportunity offered to any person who is an officer or
employee of USA Networks and an officer of the Company shall belong to the
Company if such opportunity is expressly offered to such person in his or
her capacity as an officer or employee of the Company, and otherwise shall
belong to USA Networks.

For purposes of the foregoing:

(i) A director of the Company who is Chairman of the Board of Directors
of the Company or of a committee thereof shall not be deemed to be an
officer of the Company by reason of holding such position (without regard
to whether such position is deemed an office of the Company under the
Restated Bylaws of the Company), unless such person is a full-time employee
of the Company; and

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(ii) The term "Company" shall mean the Company and all corporations,
partnerships, joint ventures, associations and other entities in which the
Company beneficially owns (directly or indirectly) 50% or more of the
outstanding voting stock, voting power, partnership interests or similar
voting interests. The term "USA Networks" shall mean USA Networks, Inc., a
Delaware corporation, USANi LLC, a Delaware limited liability company, and
all corporations, partnerships, joint ventures, associations and other
entities (other than the Company, as defined in accordance with this
paragraph) in which USA Networks beneficially owns (directly or indirectly)
50% or more of the outstanding voting stock, voting power, partnership
interests or similar voting interests.

The foregoing provisions of the Company's Restated Certificate of
Incorporation shall expire on the date that USA Networks ceases to
beneficially own Common Stock representing at least 20% of the total voting
power of all classes of outstanding capital stock of the Company entitled to
vote in the election of directors and no
person who is a director or officer of the Company is also a director or
officer of USA Networks. In addition to any vote of the stockholders required
by law, until the time that USA Networks ceases to beneficially own Common
Stock representing at least 20% of the total voting power of all classes of
outstanding capital stock of the Company entitled to vote in the election of
directors, the affirmative vote of the holders of more than 80% of the total
voting power of all such classes of outstanding capital stock of the Company
shall be required to alter, amend or repeal in a manner adverse to the
interests of USA Networks, or adopt any provision adverse to the interests of
USA Networks and inconsistent with, the corporate opportunity provisions
described above.

Any person purchasing or otherwise acquiring any interest in shares of the
capital stock of the Company shall be deemed to have notice of and to have
consented to the foregoing provisions of the Company's Restated Certificate of
Incorporation.

ANTITAKEOVER EFFECTS OF PROVISIONS OF CERTIFICATE OF INCORPORATION AND BYLAWS

Certain provisions of the Company's Restated Certificate of Incorporation
and Restated Bylaws and DGCL Section 203 may render more difficult, or have
the effect of discouraging, unsolicited takeover bids from third parties or
the removal of incumbent management of the Company. These provisions include
the right of the holders of Class A Common Stock to 15 votes per share, versus
one vote per share for the holders of Class B Common Stock, and provide that
the stockholders may not call special meetings. In addition, the Company's
Restated Certificate of Incorporation authorizes the Board of Directors to
issue, without stockholder approval, 2,000,000 shares of Preferred Stock with
voting, conversion and other rights and preferences that could adversely
affect the voting power or other rights of the holders of Common Stock of the
Company. Although the Company has no current plans to issue any shares of
Preferred Stock, the issuance of Preferred Stock or rights to purchase
Preferred Stock could render more difficult, or have the effect of
discouraging, unsolicited takeover bids from third parties or the removal of
incumbent management of the Company, or otherwise adversely affect the market
price for the Class B Common Stock. See "--Preferred Stock." Although, such
provisions do not have a substantial practical significance to investors while
USAi, through its ownership of Class A Common Stock, is in a position to
effectively control all matters affecting the Company, such provisions could
have the effect of depriving stockholders of an opportunity to sell their
shares at a premium over prevailing market prices should USAi no longer be in
such control.

EFFECT OF DELAWARE ANTITAKEOVER STATUTE

The Company is subject to Section 203 of the DGCL (the "Antitakeover Law"),
which regulates corporate acquisitions. The Antitakeover Law prevents certain
Delaware corporations, including those whose securities are listed for trading
on the Nasdaq National Market, from engaging under certain circumstances in a
"business combination" with any "interested stockholder" for three years
following the date that such stockholder became an interested stockholder. For
purposes of the Antitakeover Law, a "business combination" includes, among
other things, a merger or consolidation involving the Company and the
interested stockholder and the sale of more than ten percent of the Company's
assets. In general, the Antitakeover Law defines an "interested stockholder"
as any entity or person beneficially owning 15% or more of the outstanding
voting stock of the

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Company and any entity or person affiliated with or controlling or controlled
by such entity or person. A Delaware corporation may "opt out" of the
Antitakeover Law with an express provision in its original certificate of
incorporation or an express provision in its certificate of incorporation or
bylaws resulting from amendments approved by the holders of at least a
majority of the Company's outstanding voting shares. The Company has not
"opted out" of the provisions of the Antitakeover Law. The restrictions of the
Antitakeover Law will not apply to USAi, however, because (i) the Company's
Board of Directors approved the transaction which resulted in USAi becoming an
"interested stockholder" prior to the consummation of that transaction and
(ii) at the time USAi became an "interested stockholder," the restrictions of
Section 203 did not apply to the Company because the Company did not have a
class of voting stock (x) listed on a national securities exchange,
(y) authorized for quotation on the Nasdaq Stock Market or (z) held of record
by more than 2,000 stockholders.

REGISTRATION RIGHTS

After this offering, the holders of 7,006,671 shares of Class A Common Stock
will have the right in certain circumstances to request the Company to
register their shares under the Securities Act for resale to the public in the
event of a Company-initiated registration. Under the terms of the agreements
between the Company and the holders of such registrable securities, if the
Company proposes to register any of its securities under the Securities Act,
such holders are entitled to notice of such registration and are entitled to
include shares of such Class A Common Stock therein. These registration rights
are subject to certain conditions and limitations, among them the right of the
underwriters of an offering to limit the number of shares included in such
registration.

TRANSFER AGENT

The Transfer Agent and Registrar for the Common Stock is ChaseMellon
Shareholder Services, L.L.C.

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SHARES ELIGIBLE FOR FUTURE SALE

Prior to this offering, there has been no public market for the Class B
Common Stock of the Company. Future sales of substantial amounts of Class B
Common Stock in the public market (including by optional or automatic
conversion of shares of Class A Common Stock into Class B Common Stock), or
the anticipation of such sales, could materially adversely affect prevailing
market prices. Furthermore, since only a limited number of shares will be
available for sale shortly after the offering because of certain contractual
and legal restrictions on resale described below, sales of substantial amounts
of Class B Common Stock of the Company in the public market (including by
optional or automatic conversion of shares of Class A Common Stock into Class
B Common Stock) after such restrictions lapse could materially adversely
affect the prevailing market price and the ability of the Company to raise
equity capital in the future.

Upon completion of this offering, the Company will have 7,000,000 shares of
Class B Common Stock outstanding and 62,486,478 shares of Class A Common Stock
(based on shares outstanding as of September 30, 1998 and assuming no exercise
of currently outstanding options or warrants). USAi beneficially owns
42,480,143 shares of Class A Common Stock. Shares of Class A Common Stock are
convertible into Class B Common Stock on a share-for-share basis at the
election of the holder or automatically upon certain transfers thereof. The
7,000,000 shares of Class B Common Stock sold in this offering (plus any
additional shares sold upon exercise of the Underwriters' over-allotment
option) will be freely transferable without restriction under the Securities
Act, unless they are held by Affiliates. The remaining 62,486,478 shares of
Class B Common Stock issuable upon conversion of the Class A Common Stock
(including the shares of Class B Common Stock issuable upon certain transfers
of the Class A Common Stock or at the option of the holder thereof) held by
existing stockholders are Restricted Shares. Restricted Shares may be sold in
the public market only if registered or if they qualify for an exemption from
registration under Rule 144 or Rule 701 under the Securities Act. As a result
of contractual restrictions and the provisions of Rules 144 and 701,
additional shares will be available for sale in the public market as follows:
(i) approximately 1,253,002 Restricted Shares will be eligible for immediate
sale on the effective date of this offering; (ii) approximately 5,200
Restricted Shares will be eligible for sale 90 days after the effective date
of this offering; (iii) approximately 7,138,773 Restricted Shares will be
eligible for sale without restriction and 13,229,425 Restricted Shares will be
eligible for sale subject to volume limitations, in each case 180 days after
the effective date of this offering upon the expiration of contractual lock-up
agreements with the Company and the representatives of the Underwriters, and
(iv) the remainder of the Restricted Shares will be eligible for sale from
time to time thereafter upon expiration of their respective holding periods
under Rule 144. In addition, 2,539,665 shares will be issuable upon exercise
of vested stock options 180 days after the effective date of this offering
upon the expiration of contractual lock-up agreements. NationsBanc Montgomery
Securities LLC, on behalf of the Underwriters, may, in its sole discretion and
at any time without notice, release all or any portion of securities subject
to the lock-up agreement with the Underwriters.

In addition, the Company expects to file a registration statement on Form S-
8 registering a total of approximately 3,890,694 shares of Class A Common
Stock subject to outstanding stock options under the 1996 Stock Plan and an
aggregate of shares of Class B Common Stock reserved for future issuance
under the 1998 Stock Plan and Purchase Plan. The Form S-8 registration
statement is expected to be filed and to become effective immediately
following the date of this offering. Shares registered under such registration
statement will be available for sale in the open market, subject to Rule 144
value limitations applicable to Affiliates, unless such shares are subject to
vesting restrictions with the Company or the lock-up agreements described
above.

In general, under Rule 144 as currently in effect, beginning 90 days after
the effective date of the offering, an Affiliate of the Company or person (or
persons whose shares are aggregated) who has beneficially owned Restricted
Shares for at least one year is entitled to sell within any three-month period
a number of shares that does not exceed the greater of (i) one percent of the
then outstanding shares of the Company's Class B Common Stock or (ii) the
average weekly trading volume of the Company's Class B Common Stock in the
Nasdaq

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National Market during the four calendar weeks immediately preceding the date
on which the notice of the sale is filed with the Commission. Sales pursuant
to Rule 144 are subject to certain requirements relating to the manner of
sale, notice, and availability of current public information about the
Company. A person (or persons whose shares are aggregated) who is not an
Affiliate of the Company at any time during the 90 days immediately preceding
the sale, and who has beneficially owned Restricted Shares for at least two
years is entitled to sell such shares under Rule 144(k) without regard to the
limitations described above.

An employee, officer or director of the Company or a consultant to the
Company who purchased or was awarded shares or options to purchase shares
pursuant to a written compensatory plan or contract is entitled to rely on the
resale provisions of Rule 701 of the Securities Act, which permits Affiliates
and non-Affiliates to sell their Rule 701 shares without having to comply with
Rule 144's holding period restrictions, in each case commencing 90 days after
the date of this offering. In addition, non-Affiliates may sell Rule 701
shares without complying with the public information, volume and notice
provisions of Rule 144.

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UNDERWRITING

The Underwriters named below (the "Underwriters"), represented by
NationsBanc Montgomery Securities LLC, Allen & Company Incorporated,
BancBoston Robertson Stephens Inc., Bear, Stearns & Co. Inc. and Donaldson,
Lufkin & Jenrette Securities Corporation (the "Representatives"), have
severally agreed, subject to the terms and conditions set forth in the
underwriting agreement, among the Underwriters and the Company (the
"Underwriting Agreement"), to purchase from the Company the number of shares
of Class B Common Stock indicated below opposite their respective names at the
initial public offering price less the underwriting discount set forth on the
cover page of this Prospectus. The Underwriting Agreement provides that the
obligations of the Underwriters are subject to certain conditions precedent
and that the Underwriters are committed to purchase all of the shares if they
purchase any.

<TABLE>
<CAPTION>
NUMBER OF
UNDERWRITERS SHARES
------------ ---------
<S> <C>
NationsBanc Montgomery Securities LLC..............................
Allen & Company Incorporated.......................................
BancBoston Robertson Stephens Inc. ................................
Bear, Stearns & Co. Inc. ..........................................
Donaldson, Lufkin & Jenrette Securities Corporation................
---
Total............................................................
===
</TABLE>

The Representatives have advised the Company that the Underwriters initially
propose to offer the shares of Class B Common Stock to the public on the terms
set forth on the cover page of this Prospectus. The Underwriters may allow to
selected dealers a concession of not more than $ per share, and the
Underwriters may allow, and such dealers may reallow, a concession of not more
than $ per share to certain other dealers. After the offering, the offering
price and concessions and other selling terms may be changed by the
Representatives. No change in such terms shall change the amount of proceeds
to be received by the Company as set forth on the cover page of this
Prospectus. The Class B Common Stock is offered subject to receipt and
acceptance by the Underwriters and to certain other conditions, including the
right to reject orders in whole or in part. In addition, the Representatives
have agreed to reimburse the Company for up to $562,500 of the out-of-pocket
expenses incurred by the Company in connection with this offering, depending
on the gross proceeds of this offering. Based on the offering of 7,000,000
shares of Class B Common Stock hereby, at the assumed initial public offering
price of $9.00 per share, there will be no such reimbursement.

At the request of the Company, up to 5% of the shares of Class B Common
Stock to be sold by the Company in this offering have been reserved for sale
to certain persons, including officers, directors and employees of the
Company, pursuant to a directed shares program.

The Company has granted an option to the Underwriters, exercisable during
the 30-day period after the date of this Prospectus, to purchase up to a
maximum of 1,050,000 additional shares of Class B Common Stock to cover over-
allotments, if any, at the same price per share as the initial shares to be
purchased by the Underwriters. To the extent the Underwriters exercise this
option, each of the Underwriters will be committed to purchase such additional
shares in approximately the same proportion as set forth in the above table.
The Underwriters may purchase such shares only to cover over-allotments made
in connection with this offering.

The Underwriting Agreement provides that the Company will indemnify the
Underwriters against certain liabilities, including civil liabilities under
the Securities Act, or will contribute to payments the Underwriters may be
required to make in respect thereof.

All of the Company's officers and directors and certain stockholders have
agreed that, subject to certain exceptions, for a period of 180 days after the
date of this Prospectus, they will not, without the prior written consent of
NationsBanc Montgomery Securities LLC, directly or indirectly, sell, offer to
sell or otherwise dispose

105
<PAGE>

(other than pursuant to a conversion of shares of Class A Common Stock to
Class B Common Stock) of any shares of Class A Common Stock, Class B Common
Stock issuable upon conversion thereof or any right to acquire such shares or
any security convertible into or exchangeable or exercisable for any such
shares or rights to acquire such shares. In addition, the Company has agreed
that, for a period of 180 days after the date of this Prospectus, it will not,
without the prior written consent of NationsBanc Montgomery Securities LLC,
issue, offer, sell, grant options to purchase or otherwise dispose of any of
the Company's securities or any other securities convertible into or
exchangeable or exercisable for the Class B Common Stock or other security of
the Company, other than the grant of options to purchase Class B Common Stock,
or the issuance of shares of Class B Common Stock under the Company's stock
option and stock purchase plans, the issuance of shares of Class B Common
Stock in connection with certain acquisitions and the issuance of shares of
Class B Common Stock pursuant to the exercise of outstanding options.

Prior to this offering, there has been no public market for the Class B
Common Stock. Consequently, the initial public offering price will be
determined by negotiations between the Company and the Representatives. Among
the factors to be considered in such negotiations will be the history of, and
the prospects for, the Company and the industry in which it competes, an
assessment of the Company's management, the prospects for future earnings of
the Company, the present state of the Company's development, the general
condition of the securities markets at the time of the offering, the market
prices of and demand for publicly traded common stock of comparable companies
in recent periods and other factors deemed relevant.

The Representatives, on behalf of the Underwriters, may engage in over-
allotment, stabilizing transactions, syndicate covering transactions and
penalty bids in accordance with Regulation M under the Exchange Act. Over-
allotment involves syndicate sales in excess of the offering size, which
creates a syndicate short position. Stabilizing transactions permit bids to
purchase the underlying security so long as the stabilizing bids do not exceed
a specified maximum. Syndicate covering transactions involve purchases of
shares of Class B Common Stock in the open market after the distribution has
been completed in order to cover syndicate short positions. Penalty bids
permit the Representatives to reclaim a selling concession from a syndicate
member when the shares of Class B Common Stock originally sold by such
syndicate member are purchased in a syndicate covering transaction to cover
syndicate short positions. Such stabilizing transactions, syndicate covering
transactions and penalty bids may cause the price of the Class B Common Stock
to be higher than it would otherwise be in the absence of such transactions.
These transactions may be effected on the Nasdaq National Market or otherwise
and, if commenced, may be discontinued at any time.

The Representatives have informed the Company that the Underwriters do not
expect to make sales in excess of five percent of the number of shares of
Class B Common Stock offered hereby to accounts over which they exercise
discretionary authority.

In consideration of the services rendered by NationsBanc Montgomery
Securities LLC as placement agent for the Series E Preferred Stock, CitySearch
paid to NationsBanc Montgomery Securities LLC a fee equal to $1,546,182 in
November 1997. As additional consideration for such services, CitySearch
granted to NationsBanc Montgomery Securities LLC a warrant to purchase 94,286
shares of Series E Preferred Stock (or 93,107 shares of Class A Common Stock
pursuant to the Conversion and the Reclassification). The warrant is
exercisable at any time at an exercise price of $8.86 per share of Class A
Common Stock. Any unexercised portion of the warrant is automatically
convertible into Class A Common Stock immediately prior to the closing of this
offering for that number of shares of Class A Common Stock equal to (x) the
value of the unexercised portion as of the date of the closing of this
offering, which value shall equal the difference between the aggregate
exercise price and the aggregate value of the shares of Class A Common Stock
issuable upon exercise of the unexercised portion of the warrant, at a per
share price equal to the initial offering price divided by (y) the initial
offering price.

In connection with the Merger, NationsBanc Montgomery Securities LLC acted
as the Company's financial advisor. In addition to reimbursing NationsBanc
Montgomery Securities LLC for reasonable out-of-pocket expenses, the Company
has paid a customary fee to NationsBanc Montgomery Securities LLC in
connection

106
<PAGE>

with such services. In addition, the Company has agreed to indemnify
NationsBanc Montgomery Securities LLC against certain liabilities in
connection with the Merger or will contribute to payments that NationsBanc
Montgomery Securities LLC may be required to make in respect thereof.

Bayview Investors, Ltd., an entity affiliated with BancBoston Robertson
Stephens Inc., holds 25,165 shares of Class A Common Stock. Global Retail
Partners, L.P. and its affiliates, each an affiliate of Donaldson, Lufkin &
Jenrette Securities Corporation, holds 714,286 shares of Class A Common Stock.

Donald R. Keough, the Chairman of Allen & Company Incorporated, currently
serves as a director of USAi.

LEGAL MATTERS

The validity of the Class B Common Stock offered hereby will be passed upon
for the Company by Wilson Sonsini Goodrich & Rosati, Professional Corporation,
Palo Alto, California. Venture Law Group, A Professional Corporation, Menlo
Park, California, is acting as counsel for the Underwriters in connection with
certain legal matters relating to the shares of Class B Common Stock offered
hereby. An entity affiliated with Wilson Sonsini Goodrich & Rosati,
Professional Corporation, holds an aggregate of 75,281 shares of Class A
Common Stock.

EXPERTS

The consolidated financial statements of CitySearch, Inc. at December 31,
1996 and 1997 and for the period from September 20, 1995 (date of formation)
to December 31, 1995 and for the years ended December 31, 1996 and 1997, and
the financial statements of Ticketmaster Online-CitySearch, Inc. (Ticketmaster
Online) (formerly Ticketmaster Multimedia Holdings, Inc.) at January 31, 1997
and 1998 and for the years ended January 31, 1996, 1997 and 1998, included in
this Prospectus have been audited by Ernst & Young LLP, independent auditors,
as stated in their reports thereon appearing elsewhere herein and in the
Registration Statement, and are included in reliance upon such reports given
upon the authority of such firm as experts in accounting and auditing.

ADDITIONAL INFORMATION

The Company has filed with the Commission a Registration Statement under
the Securities Act with respect to the securities offered hereby. This
Prospectus does not contain all of the information set forth in the
Registration Statement and the exhibits and schedules thereto. For further
information with respect to the Company and the Class B Common Stock,
reference is made to the Registration Statement and the exhibits and schedules
filed as a part thereof. Statements contained in this Prospectus as to the
contents of any contract or any other document referred to are not necessarily
complete. In each instance, reference is made to the copy of such contract or
document filed as an exhibit to the Registration Statement, and each such
statement is qualified in all respects by such reference. The Registration
Statement, including exhibits and schedules thereto, may be inspected without
charge at the public reference facilities maintained by the Commission at 450
Fifth Street, N.W., Washington, D.C. 20549 and at the regional offices of the
Commission located at Seven World Trade Center, Suite 1300, New York, New York
10048 and Northwestern Atrium Center, 500 Madison Street, Suite 1400, Chicago,
Illinois 60661-2511. Copies of such materials may be obtained from the Public
Reference Section of the Commission, 450 Fifth Street, N.W., Washington, D.C.
20549, at prescribed rates. The Commission maintains a World Wide Web site
that contains reports, proxy and information statements and other information
regarding registrants that file electronically with the Commission. The
address of the Commission's Web site is http://www.sec.gov.

107
<PAGE>

INDEX TO FINANCIAL STATEMENTS

CONTENTS

<TABLE>
<S> <C>
UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL STATEMENTS
Introduction.............................................................. F-2
Unaudited Pro Forma Condensed Balance Sheet at September 30, 1998......... F-3
Unaudited Pro Forma Condensed Combined Statement of Operations for the
nine months ended September 30, 1998..................................... F-4
Unaudited Pro Forma Condensed Combined Statement of Operations for the
year ended December 31, 1997............................................. F-5
Notes to Unaudited Pro Forma Condensed Combined Financial Statements...... F-6
TICKETMASTER ONLINE-CITYSEARCH, INC. (TICKETMASTER ONLINE)
Report of Independent Auditors............................................ F-8
Balance Sheets at January 31, 1997 and 1998 and September 30, 1998
(unaudited).............................................................. F-9
Statements of Operations for the years ended January 31, 1996, 1997 and
1998 and the eight months ended September 30, 1997 and 1998 (unaudited).. F-10
Statements of Stockholders' Equity for the years ended January 31, 1996,
1997 and 1998 and the eight months ended September 30, 1998 (unaudited).. F-11
Statements of Cash Flows for the years ended January 31, 1996, 1997 and
1998 and the eight months ended September 30, 1997 and 1998 (unaudited).. F-12
Notes to Financial Statements............................................. F-13
CITYSEARCH, INC.
Report of Independent Auditors............................................ F-23
Consolidated Balance Sheets at December 31, 1996 and 1997 and at September
28, 1998 (unaudited)..................................................... F-24
Consolidated Statements of Operations for the period from September 20,
1995 (date of formation) to December 31, 1995, the years ended December
31, 1996 and 1997 and the nine months ended September 30, 1997 and
September 28, 1998 (unaudited)........................................... F-25
Consolidated Statements of Stockholders' Equity (Deficit) for the period
from September 20, 1995 (date of formation) to December 31, 1995, the
years ended December 31, 1996 and 1997 and the nine months ended
September 28, 1998 (unaudited)........................................... F-26
Consolidated Statements of Cash Flows for the period from September 20,
1995 (date of formation) to December 31, 1995, the years ended December
31, 1996 and 1997 and the nine months ended September 30, 1997 and
September 28, 1998 (unaudited)........................................... F-27
Notes to Consolidated Financial Statements................................ F-29
</TABLE>

F-1
<PAGE>

UNAUDITED PRO FORMA CONDENSED COMBINED
FINANCIAL STATEMENTS

The following unaudited pro forma condensed combined financial statements
(the "Condensed Statements") have been prepared to give effect to the Merger,
which was effective September 28, 1998, and the Tender Offer (as described
below). In addition, the Condensed Statements have been prepared to give
effect to the Ticketmaster Transaction and the Ticketmaster License Agreement.
The Merger was accounted for using the "reverse purchase" method of
accounting, pursuant to which Ticketmaster Online was treated as the acquiring
entity for accounting purposes, and the assets and liabilities of CitySearch
will be recorded at their respective fair values under the purchase method of
accounting. Capitalized terms presented in the unaudited condensed combined
pro forma financial statements, including the notes thereto, are defined
elsewhere in this Prospectus.

The Condensed Statements reflect certain assumptions regarding the Merger
and the Tender Offer and are based on the historical consolidated financial
statements of the respective entities. The Condensed Statements, including the
notes thereto, are qualified in their entirety by reference to and should be
read in conjunction with, the audited financial statements of CitySearch, Inc.
and Ticketmaster Online, including the notes thereto, which are included in
this Prospectus. The unaudited financial statements of Ticketmaster Online for
the year ended December 31, 1997 and nine months ended September 30, 1998 were
derived from the historical financial information of Ticketmaster Online which
has been adjusted to reflect a change in year end to December 31.

The unaudited pro forma condensed balance sheet as of September 30, 1998
includes the historical effect of the Merger, which was effective September
28, 1998, and on a pro forma basis, gives effect to the Tender Offer as if it
had occurred on September 30, 1998.

The unaudited pro forma condensed combined statement of operations for the
nine months ended September 30, 1998 reflects the unaudited consolidated
statement of operations of CitySearch for the nine-month period ended
September 28, 1998, combined with the unaudited statement of operations of
Ticketmaster Online (including the pro forma effects of the Ticketmaster
Transaction), for the nine months ended September 30, 1998.

The unaudited pro forma condensed combined statement of operations for the
year ended December 31, 1997 reflects the audited consolidated statement of
operations of CitySearch for the year ended December 31, 1997, combined with
the unaudited results of operations of Ticketmaster Online for the year ended
December 31, 1997 (including the pro forma effects of the Ticketmaster
Transaction).

On October 2, 1998 USAi commenced a tender offer ("the Tender Offer") to
purchase up to 20% of each stockholder's Common Stock at a per share purchase
price of $8.67 in cash, up to an aggregate of 2,924,339 shares. Upon
expiration of the Tender Offer on November 3, 1998, USAi purchased 1,997,502
shares of Common Stock.

The Company is in the process of evaluating the fair value of assets
acquired and liabilities assumed in order to make a final allocation of the
excess purchase price, including allocation to the intangibles other than
goodwill. Accordingly, the purchase accounting information is preliminary and
has been made solely for the purpose of developing such unaudited pro forma
condensed combined financial information. Based on current information the
preliminary determination of the costs in excess of the net assets acquired
and the allocation to goodwill should not materially differ from the final
determination.

The Condensed Statements are presented for illustrative purposes only and
are not necessarily indicative of the results of operations which would have
actually been reported for the nine months ended September 30, 1998, or for
the year ended December 31, 1997 had the Merger and Ticketmaster Transaction
occurred as of January 1, 1997, nor are the Condensed Statements necessarily
indicative of future results of operations.

F-2
<PAGE>

UNAUDITED PRO FORMA CONDENSED BALANCE SHEET OF TICKETMASTER ONLINE-CITYSEARCH
INC.

AS OF SEPTEMBER 30, 1998

(IN THOUSANDS)

<TABLE>
<CAPTION>
HISTORICAL PRO FORMA
TICKETMASTER TICKETMASTER
ONLINE-- PRO FORMA ONLINE--
CITYSEARCH, INC. ADJUSTMENTS CITYSEARCH, INC.
---------------- ----------- ----------------
<S> <C> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents.... $ 57,877 $ -- $ 57,877
Accounts receivable, net..... 631 -- 631
Related party receivable..... 424 -- 424
Due from licensees........... 1,673 -- 1,673
Prepaid expenses............. 243 -- 243
-------- ------- --------
Total current assets....... 60,848 -- 60,848
Computers, software, equipment,
and leasehold improvements,
net........................... 5,878 -- 5,878
Cost in excess of net assets
acquired...................... 297,031 17,200 (1) 314,231
-------- ------- --------
Total assets............... $363,757 $17,200 $380,957
======== ======= ========
LIABILITIES AND STOCKHOLDERS'
EQUITY
Current liabilities:
Accounts payable............. $ 2,797 $ -- $ 2,797
Accrued expenses............. 4,465 -- 4,465
Deferred revenue............. 3,314 -- 3,314
Current portion of capital
lease obligations........... 908 -- 908
-------- ------- --------
Total current liabilities.. 11,484 -- 11,484
Deferred rent.................. 203 -- 203
Deferred purchase price of
subsidiary.................... 446 -- 446
Convertible promissory note to
related party................. 50,000 -- 50,000
Capital lease obligations, net
of current portion............ 1,671 -- 1,671
Stockholders' equity:
Common Stock and additional
paid-in capital............. 296,078 17,200 (1) 313,278
Retained earnings............ 3,875 -- 3,875
-------- ------- --------
Total stockholders' equity..... 299,953 17,200 317,153
-------- ------- --------
Total liabilities and
stockholders' equity........ $363,757 $17,200 $380,957
======== ======= ========
</TABLE>

See accompanying notes to the unaudited pro forma condensed combined financial
statements.

F-3
<PAGE>

UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS OF
TICKETMASTER ONLINE-CITYSEARCH, INC.

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1998

(IN THOUSANDS, EXCEPT PER SHARE DATA)

<TABLE>
<CAPTION>
TICKETMASTER
TICKETMASTER PRO FORMA ONLINE AND
HISTORICAL ONLINE ADJUSTED CITYSEARCH
TICKETMASTER PRO FORMA TICKETMASTER HISTORICAL PRO FORMA PRO FORMA
ONLINE ADJUSTMENTS ONLINE CITYSEARCH ADJUSTMENTS COMBINED
------------ ------------ ------------ ---------- ------------ ---------
<S> <C> <C> <C> <C> <C> <C>
Revenues:
Ticketing operations.. $10,571 $ -- $10,571 $ -- $ -- $ 10,571
Sponsorship and
advertising.......... 4,555 -- 4,555 360 -- 4,915
City guide and
related.............. 112 -- 112 10,957 -- 11,069
------- ------- ------- -------- -------- --------
15,238 -- 15,238 11,317 -- 26,555
Costs and expenses:
Ticketing operations.. 5,947 -- 5,947 -- 2,613 (3) 7,810
(750)(4)
City guide and
related.............. 97 -- 97 10,491 -- 10,588
Sales and marketing... 832 -- 832 14,902 -- 15,734
Research and
development.......... 38 -- 38 5,000 -- 5,038
General and
administrative....... 1,467 -- 1,467 5,104 (573)(4) 5,998
Amortization of
goodwill............. 1,224 1,935 (2) 3,159 -- 39,937 (5) 43,096
Merger and other
transactions costs... -- -- -- 3,101 -- 3,101
------- ------- ------- -------- -------- --------
9,605 1,935 11,540 38,598 41,227 91,365
------- ------- ------- -------- -------- --------
Income (loss) from
operations............. 5,633 (1,935) 3,698 (27,281) (41,227) (64,810)
Interest income......... 21 -- 21 995 -- 1,016
Interest expense........ (22) -- (22) (768) 470 (6) (320)
------- ------- ------- -------- -------- --------
(1) -- (1) 227 470 696
------- ------- ------- -------- -------- --------
Income (loss) before
provision for income
taxes.................. 5,632 (1,935) 3,697 (27,054) (40,757) (64,114)
Provision for income
taxes.................. 2,993 -- 2,993 -- (2,993)(7) --
------- ------- ------- -------- -------- --------
Net income (loss)....... $ 2,639 $(1,935) $ 704 $(27,054) $(37,764) $(64,114)
======= ======= ======= ======== ======== ========
Basic and diluted net
loss per share......... $ (2.73) $ (1.04)
======== ========
Shares used to compute
basic and diluted net
loss per share......... 9,923 61,785 (8)
======== ========
</TABLE>

See accompanying notes to the unaudited pro forma condensed combined financial
statements.

F-4
<PAGE>

UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS OF
TICKETMASTER ONLINE-CITYSEARCH, INC.

YEAR ENDED DECEMBER 31, 1997

(IN THOUSANDS, EXCEPT PER SHARE DATA)

<TABLE>
<CAPTION>
TICKETMASTER
TICKETMASTER PRO FORMA ONLINE AND
HISTORICAL ONLINE ADJUSTED CITYSEARCH
TICKETMASTER PRO FORMA TICKETMASTER HISTORICAL PRO FORMA PRO FORMA
ONLINE ADJUSTMENTS ONLINE CITYSEARCH ADJUSTMENTS COMBINED
------------ ------------ ------------ ---------- ------------ ---------
<S> <C> <C> <C> <C> <C> <C>
Revenues:
Ticketing operations.. $5,442 $ -- $ 5,442 $ -- $ -- $ 5,442
Sponsorship and
advertising.......... 3,853 -- 3,853 112 -- 3,965
City guide and
related.............. -- -- -- 6,072 -- 6,072
------ ------- ------- -------- -------- --------
9,295 -- 9,295 6,184 -- 15,479
Costs and expenses:
Ticketing operations.. 3,260 -- 3,260 -- 1,001 (3) 3,865
(396)(4)
City guide and
related.............. -- -- -- 9,688 -- 9,688
Sales and marketing... 439 -- 439 20,172 -- 20,611
Research and
development.......... -- -- -- 7,182 -- 7,182
General and
administrative....... 1,700 -- 1,700 5,883 (590)(4) 6,993
Amortization of
goodwill............. -- 3,870(2) 3,870 -- 53,591 (5) 57,461
------ ------- ------- -------- -------- --------
5,399 3,870 9,269 42,925 53,606 105,800
------ ------- ------- -------- -------- --------
Income (loss) from
operations............. 3,896 (3,870) 26 (36,741) (53,606) (90,321)
Interest income......... -- -- -- 494 -- 494
Interest expense........ -- -- -- (271) -- (271)
------ ------- ------- -------- -------- --------
-- -- -- 223 -- 223
------ ------- ------- -------- -------- --------
Income (loss) before
provision for income
taxes.................. 3,896 (3,870) 26 (36,518) (53,606) (90,098)
Provision for income
taxes.................. 1,707 -- 1,707 8 (1,707)(7) 8
------ ------- ------- -------- -------- --------
Net income (loss)....... $2,189 $(3,870) $(1,681) $(36,526) $(51,899) $(90,106)
====== ======= ======= ======== ======== ========
Basic and diluted net
loss per share......... $ (3.86) $ (1.61)
======== ========
Shares used to compute
basic and diluted net
loss per share......... 9,452 55,898 (9)
======== ========
</TABLE>

See accompanying notes to the unaudited pro forma condensed combined financial
statements.

F-5
<PAGE>

NOTES TO UNAUDITED PRO FORMA CONDENSED COMBINED
FINANCIAL STATEMENTS

MERGER COSTS

Merger costs and the preliminary determination of the unallocated excess of
Merger costs over net assets acquired are set forth below (in thousands):

<TABLE>
<S> <C>
Initial investment at cost...................................... $ 23,000
Value of portion of CitySearch acquired in the Merger........... 120,864
Shares purchased under the Tender Offer......................... 17,318
Estimated transaction costs (including non-competition
agreements).................................................... 2,000
--------
Total acquisition costs....................................... 163,182
Net assets acquired............................................. 2,517
--------
Unallocated excess of acquisition cost over net assets acquired
(see note 5)................................................... $160,665
========
</TABLE>

The initial investment at cost represents the previous purchases of shares
of Series E Preferred Stock by USAi, which were converted into 3,244,641
shares of Class A Common Stock in connection with the Merger, which, prior to
the Merger, represented approximately 11.8% of the CitySearch outstanding
equity.

The value of the non-monetary exchange between Ticketmaster Online and
CitySearch was valued by Ticketmaster Online based on the fair value of the
50.7% of CitySearch acquired in the transaction. The fair value of CitySearch
before the Merger was $238.4 million based on an assumed fair value of $8.67
per share of CitySearch's Common Stock outstanding at September 28, 1998,
including outstanding stock options under the treasury method. The fair value
of CitySearch attributable to outstanding shares of Common Stock at
September 28, 1998 was $218.9 million and the fair value of CitySearch
attributable to outstanding stock options at September 28, 1998, under the
treasury stock method, was $19.5 million. The assumed fair value of the
CitySearch Common Stock of $8.67 per share is based on the Tender Offer
consideration per share determined in a negotiated transaction.

Based on current information the preliminary determination of the costs in
excess of the net assets acquired and the allocation to goodwill should not
materially differ from the final determination.

PRO FORMA ADJUSTMENTS

(1) Represents additional goodwill and common stock and additional paid-in
capital of $17.2 million to reflect the purchase by USAi of 1,997,502
shares of Class A Common Stock from existing shareholders for $8.67 per
share pursuant to the Tender Offer.

(2) Reflects amortization expense resulting from the increase in goodwill and
other intangible assets recorded in June 1998. The adjustment to the
statement of operations for the nine months ended September 30, 1998
represents six months of amortization expense to adjust the three months
of amortization expense already recorded in the historical statement of
operations. Additional goodwill of $154.8 million represents a
preliminary allocation of goodwill resulting from USAi's acquisition of
Ticketmaster Group, which is being amortized straight line over 40 years.
(See Note 1 to the Notes to the financial statements of Ticketmaster
Online for information regarding the historical formation of the Company
and USAi's acquisition of Ticketmaster Group.) The Ticketmaster Online
amortization period is consistent with the historical amortization period
of Ticketmaster Group due to the perpetual Ticketmaster License
Agreement, and the brand identity and age of the overall Ticketmaster
business.

(3) Represents a royalty that would have been required to be paid to
Ticketmaster Corp. under the Ticketmaster License Agreement had the
Ticketmaster License Agreement been in effect. Under the

F-6
<PAGE>

NOTES TO UNAUDITED PRO FORMA CONDENSED COMBINED
FINANCIAL STATEMENTS--(CONTINUED)

agreement, Ticketmaster Online is required to pay Ticketmaster Corp. a
royalty based on a percentage of the net profit it derives from online
ticket sales.

(4) Represents certain costs allocated from Ticketmaster Corp. to
Ticketmaster Online which are now covered under the license fee (see note
2).

(5) Reflects additional amortization expense resulting from the increase in
goodwill and other intangible assets due to the Merger. The unallocated
excess of acquisition costs over net assets acquired has been
preliminarily allocated as follows: $500,000 to intangibles related to
the Non-Competition Agreements, which is being amortized over 2.5 years,
and $160.2 million to goodwill, which is being amortized over

three years. In connection with finalizing the purchase price allocation,
the Company is currently evaluating the fair value of assets acquired and
liabilities assumed. Using this information, the Company will make a final
allocation of the excess purchase price, including allocation to the
intangibles other than goodwill. Accordingly, the purchase accounting
information set forth herein is preliminary.

(6) Reflects elimination of interest expense resulting from the Convertible
Note issued in connection with the Merger since the Convertible Note will
be repaid from the proceeds of the offering.

(7) Represents income tax benefit of the Merger, as taxable income of
Ticketmaster Online is offset by tax losses of CitySearch.

(8) For the nine months ended September 30, 1998, the calculation of shares
used in calculating basic and diluted pro forma loss per share adjusts
the 9,923,000 CitySearch historical weighted average shares to reflect
the 37,238,000 shares issued to Ticketmaster Corp. in the Merger, and
14,624,000 shares issued upon the conversion of the CitySearch
Convertible Preferred Stock as if converted at the earlier of the
beginning of the period or date of issuance of the CitySearch Convertible
Preferred Stock.

(9) For the year ended December 31, 1997, basic and diluted pro forma loss
per share adjusts the 9,452,000 CitySearch historical weighted average
shares by 37,238,000 shares issued to Ticketmaster Corp. in the Merger,
and 9,208,000 shares issued upon the conversion of the CitySearch
Convertible Preferred Stock, as if converted at the earlier of the
beginning of the period or date of issuance of the CitySearch Convertible
Preferred Stock.

F-7
<PAGE>

REPORT OF INDEPENDENT AUDITORS

BOARD OF DIRECTORS
TICKETMASTER ONLINE-CITYSEARCH, INC.

We have audited the accompanying balance sheets of Ticketmaster Online-
CitySearch, Inc. (Ticketmaster Online) (formerly Ticketmaster Multimedia
Holdings, Inc., a wholly-owned subsidiary of Ticketmaster Corporation) as of
January 31, 1997 and 1998, and the related statements of operations,
stockholders' equity and cash flows for each of the three years in the period
ended January 31, 1998. These financial statements are the responsibility of
Ticketmaster Online's management. Our responsibility is to express an opinion
on these financial statements based on our audits.

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

In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of Ticketmaster Online at
January 31, 1997 and 1998, and the results of its operations and its cash
flows for each of the three years in the period ended January 31, 1998, in
conformity with generally accepted accounting principles.

Ernst & Young LLP

Los Angeles, California
September 3, 1998

F-8
<PAGE>

TICKETMASTER ONLINE

BALANCE SHEETS
(IN THOUSANDS, EXCEPT SHARE DATA)

<TABLE>
<CAPTION>
JANUARY 31,
--------------- SEPTEMBER 30,
1997 1998 1998
------ ------- -------------
(UNAUDITED)
<S> <C> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents..................... $ 3 $ -- $ 57,877
Accounts receivable, net...................... 126 167 631
Related party receivable...................... -- -- 424
Due from licensees............................ -- -- 1,673
Prepaid expenses.............................. 154 124 243
------ ------- --------
Total current assets........................ 283 291 60,848
Computers, software, equipment and leasehold
improvements, net.............................. 271 397 5,878
Cost in excess of net assets acquired........... -- -- 297,031
------ ------- --------
Total assets................................ $ 554 $ 688 $363,757
====== ======= ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable.............................. $ -- $ 158 $ 2,797
Accrued expenses.............................. 65 144 4,465
Deferred revenue.............................. -- 89 3,314
Current portion of capital lease obligations.. -- -- 908
------ ------- --------
Total current liabilities................... 65 391 11,484
Deferred rent................................... -- 8 203
Deferred purchase price of subsidiary........... -- -- 446
Convertible promissory note payable to related
party.......................................... -- -- 50,000
Capital lease obligations, net of current
portion........................................ -- -- 1,671
Stockholders' equity:
Common Stock, no par value, 1,000 shares
authorized................................... -- -- --
Preferred stock, $0.01 par value;
Authorized shares--2,000,000 at September 30,
1998........................................ -- -- --
Class A Common Stock, $0.01 par value;
Authorized shares--100,000,000 at September
30, 1998
Issued and outstanding--62,486,478........... -- -- 625
Class B Common Stock--$0.01 par value;
Authorized shares--250,000,000 at September
30, 1998
Issued and outstanding--none................. -- -- --
Class C Common Stock--$0.01 par value;
Authorized shares--2,883,506 at September 30,
1998
Issued and outstanding--none................. -- -- --
Due to (from) Ticketmaster Corp............... 1,434 (1,113) --
Additional paid-in capital.................... -- -- 295,453
Retained earnings (deficit)................... (945) 1,402 3,875
------ ------- --------
Total stockholders' equity.................. 489 289 299,953
------ ------- --------
Total liabilities and stockholders' equity.. $ 554 $ 688 $363,757
====== ======= ========
</TABLE>

See accompanying notes.

F-9
<PAGE>

TICKETMASTER ONLINE

STATEMENTS OF OPERATIONS

(IN THOUSANDS, EXCEPT PER SHARE DATA)

<TABLE>
<CAPTION>
YEAR ENDED JANUARY EIGHT MONTHS
31, ENDED SEPTEMBER 30,
---------------------- -------------------
1996 1997 1998 1997 1998
------ ------ ------ --------- ---------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
Revenues:
Ticketing operations............. $ -- $ 199 $5,972 $ 3,413 $ 9,948
Sponsorship and advertising...... 14 997 3,933 2,410 4,210
City guide and related........... -- -- -- -- 112
------ ------ ------ --------- ---------
Total revenues................. 14 1,196 9,905 5,823 14,270
Operating costs and expenses:
Ticketing operations............. -- 635 3,522 2,005 5,520
City guide and related........... -- -- -- -- 97
Sales and marketing.............. -- 290 490 266 772
Research and development......... -- -- -- -- 38
General and administrative....... 548 1,260 1,719 1,075 1,280
Amortization of goodwill......... -- -- -- -- 1,224
------ ------ ------ --------- ---------
Total costs and expenses....... 548 2,185 5,731 3,346 8,931
------ ------ ------ --------- ---------
Income (loss) from operations...... (534) (989) 4,174 2,477 5,339
Interest income.................... -- -- -- -- 21
Interest expense................... -- -- -- -- (22)
------ ------ ------ --------- ---------
-- -- -- -- (1)
------ ------ ------ --------- ---------
Income (loss) before income taxes.. (534) (989) 4,174 2,477 5,338
Income tax provision (benefit)..... (204) (374) 1,827 1,089 2,865
------ ------ ------ --------- ---------
Net income (loss).................. $ (330) $ (615) $2,347 $ 1,388 $ 2,473
====== ====== ====== ========= =========
Basic and dilutive net income
(loss) per equivalent share....... $(0.01) $(0.02) $ 0.06 $ 0.04 $ 0.07
====== ====== ====== ========= =========
Shares used to compute basic and
diluted net income (loss) per
equivalent share.................. 37,238 37,238 37,238 37,238 37,425
====== ====== ====== ========= =========
</TABLE>

See accompanying notes.

F-10
<PAGE>

TICKETMASTER ONLINE

STATEMENTS OF STOCKHOLDERS' EQUITY

(IN THOUSANDS)

<TABLE>
<CAPTION>
CLASS A
COMMON STOCK COMMON STOCK DUE TO ADDITIONAL RETAINED
------------- ------------- (FROM) PAID-IN EARNINGS
SHARES AMOUNT SHARES AMOUNT TICKETMASTER CAPITAL (DEFICIT) TOTAL
------ ------ ------ ------ ------------ ---------- --------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Balance at inception.... -- $ -- -- $ -- $ -- $ -- $ -- $ --
Issuance of common
stock.................. 1 -- -- -- -- -- -- --
Accounts receivable
transferred to
Ticketmaster Corp...... -- -- -- -- -- -- -- --
Operating charges
transferred from
Ticketmaster Corp., net
of federal income tax
allocation............. -- -- -- -- 684 -- -- 684
Net loss................ -- -- -- -- -- -- (330) (330)
--- ---- ------ ---- ------- -------- ------ --------
Balance at January 31,
1996................. 1 -- -- -- 684 -- (330) 354
Accounts receivable
transferred to
Ticketmaster Corp...... -- -- -- -- (1,088) -- -- (1,088)
Operating charges
transferred from
Ticketmaster Corp., net
of federal income tax
allocation............. -- -- -- -- 1,838 -- -- 1,838
Net loss................ -- -- -- -- -- -- (615) (615)
--- ---- ------ ---- ------- -------- ------ --------
Balance at January 31,
1997................. 1 -- -- -- 1,434 -- (945) 489
Accounts receivable
transferred to
Ticketmaster Corp...... -- -- -- -- (9,953) -- -- (9,953)
Operating charges
transferred from
Ticketmaster Corp., net
of federal income tax
allocation............. -- -- -- -- 7,406 -- -- 7,406
Net income.............. -- -- -- -- -- -- 2,347 2,347
--- ---- ------ ---- ------- -------- ------ --------
Balance at January 31,
1998................. 1 -- -- -- (1,113) -- 1,402 289
Accounts receivable
transferred to
Ticketmaster Corp.
(unaudited)............ -- -- -- -- (15,351) -- -- (15,351)
Operating charges
transferred from
Ticketmaster Corp., net
of federal income tax
allocation (unaudited). -- -- -- -- 10,451 -- -- 10,451
Allocation of purchase
price (unaudited)...... -- -- -- -- -- 154,789 -- 154,789
Reclassification of due
from Ticketmaster
(unaudited)............ -- -- -- -- 6,013 (6,013) -- --
Stock exchanged in
Merger (37,238 shares)
and USAi's initial
investment in
CitySearch at cost
(unaudited)............ (1) -- 40,483 372 -- 145,492 -- 145,864
Predecessor basis of
CitySearch (unaudited). -- -- 22,003 253 1,185 -- 1,438
Net income (unaudited).. -- -- -- -- -- -- 2,473 2,473
--- ---- ------ ---- ------- -------- ------ --------
Balance at
September 30, 1998
(unaudited).......... -- $ -- 62,486 $625 $ -- $295,453 $3,875 $299,953
=== ==== ====== ==== ======= ======== ====== ========
</TABLE>

See accompanying notes.

F-11
<PAGE>

TICKETMASTER ONLINE

STATEMENTS OF CASH FLOWS
(IN THOUSANDS)

<TABLE>
<CAPTION>
YEAR ENDED JANUARY EIGHT MONTHS
31, ENDED SEPTEMBER 30,
-------------------- ---------------------
1996 1997 1998 1997 1998
----- ----- ------ --------- ----------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
OPERATING ACTIVITIES
Net income (loss)................ $(330) $(615) $2,347 $ 1,388 $ 2,473
Adjustments to reconcile net
income (loss) to net cash
provided by (used in) operating
activities:
Depreciation and amortization.. 15 51 268 171 1,585
Changes in operating assets and
liabilities:
Accounts receivable.......... (18) (108) (41) 77 (200)
Prepaid expenses............. (205) 51 30 (68) 58
Accounts payable............. -- -- 158 95 100
Accrued expenses............. -- 65 87 102 653
Deferred revenue............. -- -- 89 83 1,281
----- ----- ------ --------- ----------
Net cash provided by (used in)
operating activities............ (538) (556) 2,938 1,848 5,950
INVESTING ACTIVITIES
Purchase of property, equipment
and leasehold improvements...... (146) (189) (250) (125) (401)
----- ----- ------ --------- ----------
Net cash used in investing
activities...................... (146) (189) (250) (125) (401)
FINANCING ACTIVITIES
Net proceeds from (distributions
to) Ticketmaster Corp........... 684 748 (2,691) (1,726) (5,549)
----- ----- ------ --------- ----------
Net cash provided by (used in)
financing activities............ 684 748 (2,691) (1,726) (5,549)
----- ----- ------ --------- ----------
Net cash acquired in CitySearch
Merger.......................... -- -- -- -- 57,877
----- ----- ------ --------- ----------
Net increase (decrease) in cash
and cash equivalents............ -- 3 (3) (3) 57,877
Cash and cash equivalents at
beginning of period............. -- -- 3 3 --
----- ----- ------ --------- ----------
Cash and cash equivalents at end
of period....................... $ -- $ 3 $ -- $ -- $ 57,877
===== ===== ====== ========= ==========
</TABLE>
<TABLE>
<S> <C>
SUPPLEMENTAL STATEMENT OF CASH FLOW INFORMATION
NONCASH INVESTING AND FINANCING INFORMATION:
Acquisition of CitySearch, Inc.
Fair value of assets acquired (including cash and cash
equivalents of $57,877 and goodwill).............................. $208,675
Less:
Fair value of liabilities assumed................................. 61,373
Issuance of Class A Common Stock.................................. 147,302
--------
Cash paid........................................................ $ --
========
</TABLE>

See accompanying notes.

F-12
<PAGE>

TICKETMASTER ONLINE

NOTES TO FINANCIAL STATEMENTS

(INFORMATION AT SEPTEMBER 30, 1998 AND FOR THE EIGHT MONTHS ENDED
SEPTEMBER 30, 1997 AND 1998 IS UNAUDITED)

JANUARY 31, 1998

1. ORGANIZATION AND BUSINESS

MERGER

Prior to the Merger (as defined below), Ticketmaster Multimedia Holdings,
Inc. (Ticketmaster Online) was a wholly-owned subsidiary of Ticketmaster
Corporation (Ticketmaster Corp.).

On September 28, 1998, pursuant to an Amended and Restated Agreement and
Plan of Reorganization dated as of August 12, 1998 (the Merger Agreement), by
and among CitySearch, Inc. (CitySearch), USA Networks, Inc. (USAi),
Ticketmaster Group, Inc. (Ticketmaster Group), Ticketmaster Online and
Tiberius, Inc. (Tiberius), a wholly-owned subsidiary of CitySearch, Tiberius
was merged with and into Ticketmaster Online, with Ticketmaster Online
continuing as the surviving corporation and as a wholly-owned subsidiary of
CitySearch (the Merger). In connection with the Merger Agreement, all issued
and outstanding shares of Ticketmaster Online's Common Stock held by
Ticketmaster Corp. were converted into an aggregate of 37,238,000 shares of
CitySearch Common Stock and such shares were subsequently reclassified as
Class A Common Stock of the Company. The Merger was accounted for using the
"reverse purchase" method of accounting, pursuant to which Ticketmaster Online
was treated as the acquiring entity for accounting purposes, and the assets
acquired and liabilities assumed of CitySearch were recorded at their
respective fair values. The accompanying financial statements prior to the
Merger reflect the financial position, results of operations and cash flows of
Ticketmaster Online. The accompanying financial statements, subsequent to the
Merger, include the assets and liabilities of CitySearch and the results of
operations of CitySearch from September 29, 1998 through September 30, 1998.
In connection with the Merger the name of the combined company was changed
from CitySearch, Inc. to Ticketmaster Online-CitySearch, Inc. (the Company or,
subsequent to the Merger, Ticketmaster Online).

The Merger costs and the preliminary determination of the unallocated excess
of Merger costs over net assets acquired are set forth below (in thousands):

<TABLE>
<S> <C>
Initial investment at cost......................................... $ 23,000
Value of portion of CitySearch acquired in the Merger.............. 120,864
Estimated transaction costs (including non-competition
agreements)....................................................... 2,000
--------
Total acquisition costs.......................................... 145,864
Net assets acquired................................................ 2,398
--------
Unallocated excess of acquisition cost over net assets acquired ... $143,466
========
</TABLE>

The value of the non-monetary exchange between Ticketmaster Online and
CitySearch was determined by Ticketmaster Online based on the fair value of
the 50.7% of CitySearch acquired in the transaction. The fair value of
CitySearch before the Merger was $238.4 million based on an assumed fair value
of $8.67 per share of CitySearch's Common Stock outstanding at September 28,
1998, including outstanding stock options under the treasury method. The fair
value of CitySearch attributable to outstanding shares of Common Stock at
September 28, 1998 was $218.9 million and the fair value of CitySearch
attributable to outstanding stock options at September 28, 1998, under the
treasury stock method, was $19.5 million.

F-13
<PAGE>

TICKETMASTER ONLINE

NOTES TO FINANCIAL STATEMENTS--(CONTINUED)

(INFORMATION AT SEPTEMBER 30, 1998 AND FOR THE EIGHT MONTHS ENDED
SEPTEMBER 30, 1997 AND 1998 IS UNAUDITED)

On October 2, 1998 USAi commenced a tender offer (the Tender Offer) to
purchase up to 20% of each CitySearch stockholder's Common Stock at a per
share purchase price of $8.67 in cash, up to an aggregate of 2,924,339 shares.
The Tender Offer expired on November 3, 1998 and 1,997,502 shares were
tendered for purchase.

The assumed fair value of the CitySearch Common Stock of $8.67 per share is
based on the Tender Offer consideration per share determined in a negotiated
transaction.

In connection with the Merger Agreement, Ticketmaster Online also entered
into a License and Services Agreement (the License Agreement) with
Ticketmaster Corp. and USAi to remain perpetually in effect unless terminated
as allowed under the License Agreement. Under the License Agreement, for a
license fee, Ticketmaster Corp. granted Ticketmaster Online, among other
things, the exclusive worldwide right to use the trademarks of Ticketmaster
Corp. in connection with the sale of tickets and merchandise via electronic
interactive services.

PRO FORMA FINANCIAL DATA (UNAUDITED)

The following unaudited pro forma information presents a summary of results
of the Company assuming the Merger and the Tender Offer had occurred as of
January 1, 1997, with pro forma adjustments to give effect to amortization of
goodwill, certain other adjustments to conform to the terms of the License
Agreement, and the related income tax effects. The pro forma financial
information is not necessarily indicative of the results of operations as they
would have been had the transactions been effective on January 1, 1997.

<TABLE>
<CAPTION>
NINE MONTHS ENDED
YEAR ENDED SEPTEMBER 30,
DECEMBER 31, 1997 1998
----------------- -----------------
(IN THOUSANDS EXCEPT PER SHARE
DATA)
<S> <C> <C>
Revenues................................. $ 15,479 $ 26,555
Net loss................................. $ (90,106) $ (64,114)
Net loss per share....................... $ (1.61) $ (1.04)
</TABLE>

Goodwill of $297.0 million and Stockholders' Equity of $300.0 million
presented in the accompanying balance sheet as of September 30, 1998, adjusted
on a pro forma basis to give effect to the Tender Offer as if it occurred at
September 30, 1998, would have been $314.2 million and $317.2 million,
respectively.

BUSINESS

Prior to the Merger, Ticketmaster Online was a wholly-owned subsidiary of
Ticketmaster Corp. which is a leading provider of automated ticketing services
in the United States, with clients including many of the country's most well-
known entertainment facilities, promoters and professional sports franchises.
Ticketmaster Online was formed in December 1993 to administer the online
business of Ticketmaster Corp. There were no costs and expenses incurred by
Ticketmaster Online until June 1995. Ticketmaster Online commenced online
ticket sales in November 1996 providing a ticketing outlet via the World Wide
Web (Web) which gives users access to live event tickets and event
information. Ticketmaster Online's operations are the online distribution
mechanism for Ticketmaster Corp., which utilizes Ticketmaster Corp.'s business
relationships and brand name.

In July 1997, USAi acquired a controlling interest in Ticketmaster Group
through the issuance of shares of USAi common stock. The acquisition cost was
approximately $210.0 million, including expenses. In June 1998, USAi completed
its acquisition of Ticketmaster Group in a tax-free merger, pursuant to which
each outstanding share of Ticketmaster Group common stock not owned by USAi
was exchanged for 1.126 shares of USAi common

F-14
<PAGE>

TICKETMASTER ONLINE

NOTES TO FINANCIAL STATEMENTS--(CONTINUED)

(INFORMATION AT SEPTEMBER 30, 1998 AND FOR THE EIGHT MONTHS ENDED
SEPTEMBER 30, 1997 AND 1998 IS UNAUDITED)

stock. The aggregate acquisition cost was $467.0 million. These transactions
have been accounted for using the purchase method of accounting. The
acquisition cost has been allocated to the assets acquired and liabilities
assumed of Ticketmaster Group, including an allocation to Ticketmaster Online
of $154.8 million.
CitySearch was organized on September 20, 1995. CitySearch produces and
delivers comprehensive local city guides on the Web, providing up-to-date
information regarding arts and entertainment events, community events,
community activities, recreation, business, shopping, professional services
and news/sports/weather to consumers in metropolitan areas. CitySearch designs
and produces custom-built Web sites and related services for local businesses,
aggregates them in a local city guide environment and provides business
customers the ability to regularly update and expand their sites.

CitySearch has two primary means of providing its local city guides. In its
"owned and operated" markets CitySearch systematically produces the majority
of its own content, hires and rapidly deploys a direct sales force to sell
custom-built business Web sites as well as related services to local and
regional businesses and launches a presence in the market. In its partner-led
markets, CitySearch contracts with a local media company to provide assistance
in developing, designing and launching a city guide. Under these contracts,
the partners license CitySearch's business and technology systems and pay a
license fee and make royalty payments to CitySearch based on certain revenues
generated by the media partners from the operation of their sites and pay
CitySearch for additional consultation and design services not provided for
under the license fee.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

BASIS OF PRESENTATION

The financial statements include revenues related to the convenience charges
in connection with tickets sold via the Internet and advertising sales on
Ticketmaster Online's web site. Costs of ticketing revenues have been
allocated on a per ticket sold basis. The financial statements include
expenses which have been allocated to Ticketmaster Online by Ticketmaster
Corp. on a specific identification basis. Further, Ticketmaster Online shares
certain employees and other resources with Ticketmaster Corp. Allocations from
Ticketmaster Corp. for indirect expenses for such shared resources have been
made primarily on a proportional cost allocation method based on tickets sold
and related revenues. Management believes these allocations are reasonable and
that such expenses would not differ materially had Ticketmaster Online
operated on a stand-alone basis for all periods presented. The financial
statements of Ticketmaster Online do not necessarily reflect the results of
operations or financial position that would have existed had Ticketmaster
Online been an independent company.

CHANGE IN YEAR-END

The statements of operations and cash flows for the eight months ended
September 30, 1997 and 1998 reflect a change in Ticketmaster Online's year-end
as a result of the purchase of Ticketmaster Group by USAi.

INTERIM FINANCIAL STATEMENTS

The accompanying balance sheet as of September 30, 1998 and the statements
of operations and cash flows for the eight months ended September 30, 1997 and
1998 and the statement of stockholders' equity for the eight months ended
September 30, 1998 are unaudited. The accompanying balance sheet as of
September 30, 1998 reflects a preliminary allocation of the purchase price
paid by USAi in its acquisition of Ticketmaster Corp.'s ultimate parent,
Ticketmaster Group and its subsidiaries, including Ticketmaster Online. In the
opinion of

F-15
<PAGE>

TICKETMASTER ONLINE

NOTES TO FINANCIAL STATEMENTS--(CONTINUED)

(INFORMATION AT SEPTEMBER 30, 1998 AND FOR THE EIGHT MONTHS ENDED
SEPTEMBER 30, 1997 AND 1998 IS UNAUDITED)

management, the unaudited financial statements have been prepared on the same
basis as the audited financial statements and include all adjustments,
consisting of normal recurring adjustments, necessary for a fair presentation
of the financial position, results of operations, and cash flows for the
interim periods. The results of operations for the eight months ended
September 30, 1998 are not necessarily indicative of operating results to be
expected for the full fiscal year. As a result of the Merger, the financial
statements for the nine-month period ended September 30, 1998 have been
prepared on a consolidated basis including the assets and liabilities and the
results of operations of CitySearch from September 29, 1998 through September
30, 1998.

PRINCIPLES OF CONSOLIDATION

The accompanying consolidated financial statements as of September 30, 1998
and for the nine months ended September 30, 1998 include the accounts of the
Company and its wholly-owned subsidiaries. All significant intercompany
amounts have been eliminated.

REVENUE RECOGNITION

Revenue from advertising and sponsorship agreements is recognized when the
service is provided or over the license period. Revenue from the sale of
tickets is recognized when tickets are sold.

City guide and related revenues include revenue from the sale of
subscriptions for custom-built business Web sites (designed and developed by
CitySearch) in its owned and operated markets, the performance of consultation
and design services and licensing and royalty revenues from the sale of
licenses for the use of CitySearch's business and technology systems in its
partner-led markets. License and royalty revenue is less than ten percent of
consolidated revenue.

The Company recognizes subscription revenues over the period the services
are provided. Royalty revenues are recognized when earned based on the
revenues generated by the license or based on the minimum royalty provisions
in the contract. Revenue from consultation and design services is recognized
as the services are provided.

Revenues from the sale of licenses for use of the Company's business and
technology systems to its partner-led markets generally will be recognized
over the term of the license agreement or the period over which the relevant
services are delivered in accordance with Statement of Position 97-2. The
Company's license agreements have terms ranging from five to nine years.

Deferred revenue primarily consists of advertising and sponsorship revenue,
revenue from Web site support agreements with joint venture partners of
Ticketmaster Corp., and prepayments of subscription services and licensing
agreements. Web site support is recognized straight line over the life of the
agreement.

CASH EQUIVALENTS

The Company considers all highly liquid investments with a maturity of three
months or less when purchased to be cash equivalents. The Company places its
cash deposits with high-credit quality financial institutions.

ACCOUNTS RECEIVABLE

Accounts receivable prior to the Merger are principally from advertisers and
represent the net amount of the advertising agreement. The remainder is
comprised of receivables from Ticketmaster Corp.'s joint venture partners for
ticket revenues and Web site support. Subsequent to the Merger, accounts
receivable include the accounts receivable of CitySearch.

F-16
<PAGE>

TICKETMASTER ONLINE

NOTES TO FINANCIAL STATEMENTS--(CONTINUED)

(INFORMATION AT SEPTEMBER 30, 1998 AND FOR THE EIGHT MONTHS ENDED
SEPTEMBER 30, 1997 AND 1998 IS UNAUDITED)

Concentration of credit risk with respect to trade receivables is limited
based on the size and diversity of Ticketmaster Online's clients and the large
number and geographic dispersion of CitySearch customers. The Company
generally does not require collateral, however, credit losses have generally
been within management's expectations and have not been significant.

COMPUTERS, SOFTWARE, EQUIPMENT AND LEASEHOLD IMPROVEMENTS

Computers, software, equipment and leasehold improvements are stated at cost
and depreciated using the straight-line method over the estimated useful lives
of the assets, which range from three to seven years. Assets acquired under
capitalizable lease arrangements are recorded at the present value of the
minimum lease payments. Amortization of assets capitalized under capital
leases and leasehold improvements are computed using the straight-line method
over the life of the asset or term of the lease, whichever is shorter, and is
included in depreciation expense.

RESEARCH AND DEVELOPMENT

Research and development expenditures are charged to operations as incurred.
Based on the Company's product development process, technological feasibility
is established upon completion of a working model. Costs incurred by the
Company between completion of the working model and the point at which the
product is ready for general release have been insignificant.

COST IN EXCESS OF NET ASSETS ACQUIRED

Cost in excess of net assets acquired of $154.8 million represents goodwill
allocated to Ticketmaster Online from the purchase of Ticketmaster Group by
USAi and is being amortized by the straight-line method over 40 years.

As a result of the Merger, the Company recorded goodwill of $143.0 million,
which is being amortized using the straight-line method over three years and
intangibles relating to non-competition agreements of $500,000, which is being
amortized using the straight-line method over 2.5 years. Accumulated
amortization at September 30, 1998 was $1.2 million.

The Tender Offer increased the goodwill recorded in the Merger as disclosed
above by $17.2 million. Goodwill is amortized over its estimated useful life,
not to exceed 40 years.

DUE TO (FROM) TICKETMASTER CORP.

Due to (from) Ticketmaster Corp. includes amounts payable to Ticketmaster
Corp. primarily for operations and working capital requirements, offset by
amounts receivable for cash collected by Ticketmaster Corp. The balances are
primarily the result of Ticketmaster Online's participation in Ticketmaster
Corp.'s central cash management system, wherein all of Ticketmaster Online's
cash receipts are collected by Ticketmaster Corp. and all cash disbursements
are funded by Ticketmaster Corp. Other transactions include Ticketmaster
Online's pro rata share of the current portion of Ticketmaster Corp.'s
consolidated income tax liability and other administrative expenses incurred
by Ticketmaster Corp. on behalf of Ticketmaster Online. Such amounts payable
do not have specific repayment terms and do not bear interest. At January 31,
1997 and 1998, such intercompany balances have been included as a component of
stockholders' equity as it was not the original intention of Ticketmaster
Online or Ticketmaster Corp. to settle such balances in cash. The due to
(from) Ticketmaster Corp. was reclassified as additional paid-in capital in
connection with the Merger.

F-17
<PAGE>

TICKETMASTER ONLINE

NOTES TO FINANCIAL STATEMENTS--(CONTINUED)

(INFORMATION AT SEPTEMBER 30, 1998 AND FOR THE EIGHT MONTHS ENDED
SEPTEMBER 30, 1997 AND 1998 IS UNAUDITED)

An analysis of transactions in the due to (from) Ticketmaster Corp. account
for each of the three years in the period ended January 31, 1998 follows:

<TABLE>
<CAPTION>
1996 1997 1998
----- ------- -------
(IN THOUSANDS)
<S> <C> <C> <C>
Balance at beginning of year....................... $ -- $ 684 $ 1,434
Accounts receivable transferred to Ticketmaster
Corp.............................................. -- (1,088) (9,953)
Operating charges transferred from Ticketmaster
Corp. ............................................ 888 2,212 5,579
Share of Ticketmaster Corp.'s current federal
income tax provision (benefit) ................... (204) (374) 1,827
----- ------- -------
Balance at end of year............................. $ 684 $ 1,434 $(1,113)
===== ======= =======
Average balance during the year.................... $ 342 $ 1,059 $ 161
===== ======= =======
</TABLE>

INCOME TAXES

Historically, Ticketmaster Online's results have been included in
Ticketmaster Corp.'s consolidated federal and state income tax returns. The
income tax provision is calculated and deferred tax assets and liabilities are
recorded as if Ticketmaster Online had operated as an independent company.
Deferred tax assets and liabilities are recognized with respect to the tax
consequences attributable to the differences between the financial statement
carrying values and tax bases of assets and liabilities. Deferred tax assets
and liabilities are measured using enacted tax rates expected to apply to
taxable income in the years in which these temporary differences are expected
to be recovered or settled. Further, the effect on deferred tax assets and
liabilities of a change in tax rates is recognized in income in the period
that includes the enactment date. Ticketmaster Corp. pays all taxes for
Ticketmaster Online and, as such, income taxes payable and deferred tax assets
have been included in due to (from) Ticketmaster Corp. Subsequent to the
Merger, the Company will file its Federal and State income tax returns on a
stand-alone basis.

BASIC AND DILUTED EARNINGS (LOSS) PER EQUIVALENT SHARE

Basic and diluted earnings per equivalent share is based on the number of
shares of CitySearch Common Stock exchanged in the Merger for all periods
presented and for the nine months ended September 30, 1998 includes the
outstanding shares of Class A Common Stock of the Company for the two days
subsequent to the effective date of the Merger.

FINANCIAL INSTRUMENTS

The estimated fair values of cash, accounts receivable, accounts payable,
and accrued expenses approximate their carrying value because of the short
term maturity of these instruments or the stated interest rates are indicative
of market interest rates.

USE OF ESTIMATES

The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities at the

F-18
<PAGE>

TICKETMASTER ONLINE

NOTES TO FINANCIAL STATEMENTS--(CONTINUED)

(INFORMATION AT SEPTEMBER 30, 1998 AND FOR THE EIGHT MONTHS ENDED
SEPTEMBER 30, 1997 AND 1998 IS UNAUDITED)

date of financial statements and the reported amounts of revenue and expenses
during the reporting period. Actual results could differ from those estimates.

IMPAIRMENT OF LONG-LIVED ASSETS AND LONG-LIVED ASSETS TO BE DISPOSED OF

In accordance with the Statement of Financial Accounting Standards Board
(SFAS) No. 121, "Accounting for the Impairment of Long-Lived Assets and Long-
Lived Assets to Be Disposed Of," the Company periodically reviews long-lived
assets and certain identifiable intangibles for impairment whenever events or
changes in circumstances indicate that the carrying amount of an asset may not
be recoverable. Recoverability of assets to be held and used is measured by a
comparison of the carrying amount of an asset to future net cash flows (on an
undiscounted basis) expected to be generated by the asset. If such assets are
considered to be impaired, the impairment to be recognized is measured by the
amount by which the carrying amount of the assets exceeds the fair value of
the assets.

RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

In June 1997, the Financial Accounting Standards Board (FASB) issued SFAS
No. 130, "Reporting Comprehensive Income," effective for fiscal years
beginning after December 15, 1997. The Company will adopt SFAS No. 130 in
fiscal 1998 and does not expect that the adoption will have a material effect
on its financial statements.

In June 1997, the FASB issued SFAS No. 131, "Disclosures about Segments of
an Enterprise and Related Information," effective for fiscal years beginning
after December 15, 1997. The new rules establish revised standards for public
companies relating to the reporting of financial and descriptive information
about their operating segments in financial statements. The Company will adopt
SFAS No. 131 in fiscal 1998 and does not expect that the adoption will have a
material effect on its financial statements.

3. COMPUTERS, SOFTWARE, EQUIPMENT AND LEASEHOLD IMPROVEMENTS

Computers, software, equipment and leasehold improvements consisted of the
following:

<TABLE>
<CAPTION>
JANUARY
31,
-----------
1997 1998
---- -----
(IN
THOUSANDS)
<S> <C> <C>
Computer equipment.............................................. $311 $ 532
Furniture and fixtures.......................................... 8 20
Leasehold improvements.......................................... 16 33
---- -----
335 585
Less accumulated depreciation................................... (64) (188)
---- -----
$271 $ 397
==== =====
</TABLE>

Depreciation expense was $15,000, $49,000 and $124,000 for 1996, 1997 and
1998, respectively. During 1996, 1997, and 1998, rent expense allocated from
Ticketmaster Corp. amounted to $8,000, $42,000 and $149,000, respectively.

F-19
<PAGE>

TICKETMASTER ONLINE

NOTES TO FINANCIAL STATEMENTS--(CONTINUED)

(INFORMATION AT SEPTEMBER 30, 1998 AND FOR THE EIGHT MONTHS ENDED
SEPTEMBER 30, 1997 AND 1998 IS UNAUDITED)

4. INCOME TAXES

The provision (benefit) for income taxes consisted of the following:

<TABLE>
<CAPTION>
YEARS ENDED
JANUARY 31,
--------------------
1996 1997 1998
----- ----- ------
(IN THOUSANDS)
<S> <C> <C> <C>
Current:
Federal.............................................. $(186) $(340) $1,445
State................................................ (24) (46) 395
----- ----- ------
(210) (386) 1,840
----- ----- ------
Deferred:
Federal.............................................. 6 12 (13)
State................................................ -- -- --
----- ----- ------
6 12 (13)
----- ----- ------
Total income tax provision (benefit)................... $(204) $(374) $1,827
===== ===== ======
</TABLE>

The following is a reconciliation of the statutory federal income tax rate
to Ticketmaster Online's effective income tax rate:

<TABLE>
<CAPTION>
YEARS ENDED JANUARY 31,
-----------------------------
1996 1997 1998
------- ------- -------
<S> <C> <C> <C>
Statutory federal income tax expense
(benefit)............................... (34)% (34)% 34%
State income tax expense (benefit)....... (5) (6) 9
Other.................................... 1 2 1
------- ------- -------
(38)% (38)% 44%
======= ======= =======
</TABLE>

The Company had net operating loss carryforwards for federal and state
income tax purposes at September 30, 1998 of approximately $70,450,000 which
had been generated by CitySearch. The federal carryforwards expire principally
in the period from 2010 to 2012, and the state carryforwards expire
principally in 2003. These net operating loss carryforwards represent a
deferred tax asset of approximately $28.2 million, which is fully reserved for
with a valuation allowance. If the deferred tax asset becomes realizable in
the future, the reversal of the valuation allowance will be recorded as a
reduction of goodwill. Utilization of the net operating loss carryforwards is
subject to limitations as a result of ownership changes as defined in the
Internal Revenue Code. Furthermore, the net operating loss carryforwards, to
the extent not otherwise limited, can only be used to offset the future
taxable income of CitySearch.

5. DEFINED CONTRIBUTION PLANS

Ticketmaster Online participates in the Ticketmaster Corp. 401(k) defined
contribution plan (the 401(k) Plan), covering substantially all Ticketmaster
Online employees, which contains an employer matching feature of 25% up to a
maximum of 6% of the employee's compensation. Ticketmaster Online's
contribution for the 401(k) Plan years ended December 31, 1995, 1996 and 1997
was $0, $6,000 and $12,000, respectively.

F-20
<PAGE>

TICKETMASTER ONLINE

NOTES TO FINANCIAL STATEMENTS--(CONTINUED)

(INFORMATION AT SEPTEMBER 30, 1998 AND FOR THE EIGHT MONTHS ENDED
SEPTEMBER 30, 1997 AND 1998 IS UNAUDITED)

6. RELATED PARTY TRANSACTIONS

Ticketmaster Online is part of a consolidated group and, as such, has
significant transactions with related entities. The terms of those
transactions were determined between related parties and may differ from terms
which would have occurred between unrelated parties and may also differ from
the costs which would have been incurred had Ticketmaster Online operated as
an independent company.

On June 28, 1996, Ticketmaster Online entered into an agreement expiring on
December 31, 2003, with an affiliate of its then majority shareholder, whereby
in exchange for services rendered in connection with the development of
Ticketmaster Online's Web site, Ticketmaster Online will pay royalties
equaling 5% of net profit (as defined) from ticket convenience charges and 10%
of net profit (as defined) from merchandise sold through its Web site (net of
defined deductions). The agreement calls for an annual minimum royalty payment
of $100,000 per year (pro-rated for calendar 1996). Royalty expense incurred
for the years ended January 31, 1997 and 1998 amounted to $50,000 and
$138,000, respectively.

Revenues from affiliated companies for the fiscal years 1996, 1997 and 1998
amounted to $0, $21,000 and $583,000, respectively, primarily for Web site
development and support and license fee revenue.

7. STOCKHOLDERS' EQUITY AND STOCK OPTIONS

Stockholders' equity reflects the exchange of 1,000 shares of Common Stock
of Ticketmaster Online for 37,238,000 shares of CitySearch Common Stock
(subsequently reclassified as Class A Common Stock of the Company) and the
recording of the predecessor basis and outstanding shares of CitySearch Common
Stock (subsequently reclassified as Class A Common Stock of the Company) in
connection with the Merger. Holders of each share of Class A Common Stock have
15 votes. Each share of Class A Common Stock will automatically convert into
one share of Class B Common Stock upon a "transfer," as defined, of such share
except for transfers to certain parties. Holders of Class B Common Stock have
rights in the Company's Restated Certificate of Incorporation similar to
holders of Class A Common Stock except each share of Class B Common Stock
carries only one vote. Holders of Class C Common Stock have no voting rights.

The CitySearch 1996 Stock Option Plan (1996 Stock Plan) which authorized
members of management to grant non-statutory stock options or incentive stock
options to employees and consultants of the Company and its subsidiaries. As
of September 30, 1998 the maximum number of shares of Common Stock to be
issued under the Plan was 5,500,000 shares. All options granted under the 1996
Stock Plan have been made at prices not less than fair market value of the
stock at the date of grant. Options granted under the 1996 Stock Plan are
exercisable at various dates over their ten-year life. Options granted under
the 1996 Stock Plan vest principally 25% after the first year and ratably over
the remaining vesting period. At September 30, 1998 there were options to
purchase 3,890,694 shares of the Company's Class A Common Stock outstanding at
a weighted average exercise price of $3.66 per share. Options to purchase
290,000 shares of Class A Common Stock were available for future grants at
September 30, 1998.

8. CONVERTIBLE PROMISSORY NOTE PAYABLE TO RELATED PARTY

Concurrently with the execution of the Merger Agreement, the Company
received a $50 million loan from USAi in exchange for a convertible promissory
note (Convertible Note). The Convertible Note, in the principal amount of $50
million, bears interest at a rate per annum of 7.00% and, after consummation
of the Merger, is generally due and payable on the earlier to occur of (a)
August 13, 2005 or (b) 20 days following the closing of a qualified initial
public offering, as defined.

F-21
<PAGE>

TICKETMASTER ONLINE

NOTES TO FINANCIAL STATEMENTS--(CONTINUED)

(INFORMATION AT SEPTEMBER 30, 1998 AND FOR THE EIGHT MONTHS ENDED
SEPTEMBER 30, 1997 AND 1998 IS UNAUDITED)

9. COMMITMENTS

LEASES

The Company (through its acquisition of CitySearch) has noncancelable
capital lease obligations for computers and equipment and leases its
facilities and other office equipment under noncancelable operating lease
agreements expiring through 2004. Certain of the Company's leases provide for
free rent and escalations. The Company is responsible for other costs such as
property taxes, insurance, maintenance and utilities.

The following is a schedule of future minimum lease payments at September
30, 1998:

<TABLE>
<CAPTION>
OPERATING CAPITAL
LEASES LEASES
--------- -------
(IN THOUSANDS)
<S> <C> <C>
Year ended December 31:
1998.................................................... $ 329 $ 416
1999.................................................... 1,219 1,557
2000.................................................... 1,189 945
2001.................................................... 1,095 120
2002.................................................... 342 --
Thereafter.............................................. 364 --
------ ------
$4,538 $3,038
======
Less amount representing interest......................... 459
------
Net present value of net minimum lease payments (including
approximately $908 payable currently).................... $2,579
======
</TABLE>

F-22
<PAGE>

REPORT OF INDEPENDENT AUDITORS

BOARD OF DIRECTORS AND STOCKHOLDERS
CITYSEARCH, INC.

We have audited the accompanying consolidated balance sheets of CitySearch,
Inc. as of December 31, 1996 and 1997 and the related statements of operations,
stockholders' equity, and cash flows for the period from September 20, 1995
(date of formation) to December 31, 1995 and for each of the two years in the
period ended December 31, 1997. These financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements based on our audits.

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

In our opinion, the financial statements referred to above present fairly, in
all material respects, the consolidated financial position of CitySearch, Inc.
at December 31, 1996 and 1997, and the consolidated results of its operations
and its cash flows for the period from September 20, 1995 (date of formation)
to December 31, 1995 and for each of the two years in the period ended December
31, 1997 in conformity with generally accepted accounting principles.

Ernst & Young LLP

Los Angeles, California
March 11, 1998, except for Note 10
as to which the date is September
28, 1998

F-23
<PAGE>

CITYSEARCH, INC.

CONSOLIDATED BALANCE SHEETS

(IN THOUSANDS, EXCEPT PER SHARE DATA)

<TABLE>
<CAPTION>
DECEMBER 31,
------------------ SEPTEMBER 28,
1996 1997 1998
-------- -------- -------------
ASSETS (UNAUDITED)
<S> <C> <C> <C>
Current assets:
Cash and cash equivalents................... $ 7,527 $ 25,227 $ 57,877
Accounts receivable, net of allowance for
doubtful accounts of $0 in 1996 $25 in 1997
and $72 in 1998............................ 34 100 264
Due from licensees.......................... -- 57 1,467
Due from licensees--related party........... -- 136 206
Prepaid expenses and other current assets... 249 119 178
-------- -------- --------
Total current assets....................... 7,810 25,639 59,992
Computers, software, equipment and leasehold
improvements:
Computers and software...................... 2,074 7,716 9,236
Furniture and equipment..................... 391 194 194
Leasehold improvements...................... 194 275 248
Enterprise system development in process.... 1,315 -- --
-------- -------- --------
3,974 8,185 9,678
Accumulated depreciation.................... (329) (2,169) (4,461)
-------- -------- --------
3,645 6,016 5,217
Intangible asset, net of accumulated
amortization of $422 in 1996................ 1,915 -- --
-------- -------- --------
Total assets............................... $ 13,370 $ 31,655 $ 65,209
======== ======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
(DEFICIT)
Current liabilities:
Accounts payable............................ $ 1,975 $ 2,197 $ 2,540
Accrued payroll and related liabilities..... 174 664 1,270
Other accrued liabilities................... 991 760 2,398
Deferred subscription and license revenue... 327 1,836 1,936
Current portion of obligations under capital
leases..................................... 86 807 908
-------- -------- --------
Total current liabilities.................. 3,553 6,264 9,052
Deferred rent................................ 33 189 203
Deferred purchase price of subsidiary........ 1,336 891 446
Obligations under capital leases, net of
current portion............................. 82 1,340 1,671
Convertible promissory note payable to a
related party............................... -- -- 50,000
Commitments
Redeemable Convertible Preferred Stock, $0.01
par value, Series C, D, and E:
Authorized shares--12,500 at December 31,
1997
Issued and outstanding--4,706 at December
31, 1996 and 12,406 at December 31, 1997
and none at September 28, 1998
Liquidation preference--$20,731 at December
31, 1996 and $73,212 at December 31, 1997 . 20,309 70,882 --
Stockholders' equity (deficit):
Convertible Preferred Stock, $0.01 par
value, Series A and B:
Authorized shares--2,241 at December 31,
1997
Issued and outstanding--1,948 at December
31, 1996 and 2,016 at December 31, 1997
and none at September 30, 1998
Liquidation preference--$2,165 at December
31, 1996 and $2,610 at December 31, 1997 . 2,165 2,610 --
Common Stock, $0.01 par value:
Authorized shares--75,000 at December 31,
1997 and September 30, 1998
Issued and outstanding shares--8,814 at
December 31, 1996 and 9,540 at
December 31, 1997 and 25,248 at September
28, 1998 ................................. 97 472 82,582
Deferred compensation....................... -- (262) (960)
Accumulated deficit......................... (14,205) (50,731) (77,785)
-------- -------- --------
Total stockholders' equity (deficit)....... (11,943) (47,911) 3,837
-------- -------- --------
Total liabilities and stockholders' equity
(deficit)................................. $ 13,370 $ 31,655 $ 65,209
======== ======== ========
</TABLE>

See accompanying notes to consolidated financial statements.

F-24
<PAGE>

CITYSEARCH, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT PER SHARE DATA)

<TABLE>
<CAPTION>
PERIOD FROM
SEPTEMBER 20,
1995 (DATE OF YEAR ENDED
FORMATION) TO DECEMBER 31, NINE MONTHS ENDED
DECEMBER 31, ------------------ -------------------------------------
1995 1996 1997 SEPTEMBER 30, 1997 SEPTEMBER 28, 1998
------------- -------- -------- ------------------ ------------------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
Revenues:
Subscription and
services............. $ -- $ 203 $ 4,612 $ 2,781 $ 9,122
Subscription and
services--related
party................ -- -- 301 205 336
Licensing and royalty. -- -- 528 499 698
Licensing and
royalty--related
party................ -- -- 743 178 1,161
------ -------- -------- -------- --------
Total revenues...... -- 203 6,184 3,663 11,317
Costs and expenses:
Cost of revenues...... -- 2,908 9,688 7,612 10,491
Sales and marketing... 57 6,369 20,172 13,716 14,902
Research and
development.......... 152 2,563 7,182 4,949 5,000
General and
administrative....... 104 2,475 5,883 4,263 5,104
Merger and other
transactions costs... -- -- -- -- 3,101
------ -------- -------- -------- --------
Total costs and
expenses........... 313 14,315 42,925 30,540 38,598
------ -------- -------- -------- --------
Loss from operations.... (313) (14,112) (36,741) (26,877) (27,281)
Interest income......... 5 229 494 279 995
Interest expense........ -- (12) (271) (175) (768)
------ -------- -------- -------- --------
5 217 223 104 227
------ -------- -------- -------- --------
Loss before provision
for income taxes....... (308) (13,895) (36,518) (26,773) (27,054)
Provision for income
taxes.................. -- 2 8 -- --
------ -------- -------- -------- --------
Net loss................ $ (308) $(13,897) $(36,526) $(26,773) $(27,054)
====== ======== ======== ======== ========
Historical basic and
diluted net loss per
share.................. $(0.04) $ (1.58) $ (3.86) $ (2.84) $ (2.73)
====== ======== ======== ======== ========
Pro forma basic and
diluted net loss per
share.................. $ (1.96) $ (1.51) $ (1.10)
======== ======== ========
Shares used to compute
historical basic and
diluted net loss per
share.................. 7,895 8,786 9,452 9,431 9,923
====== ======== ======== ======== ========
Shares used to compute
pro forma basic and
diluted net loss per
share.................. 18,660 17,764 24,547
======== ======== ========
</TABLE>

See accompanying notes to consolidated financial statements.

F-25
<PAGE>

CITYSEARCH, INC.

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)
(IN THOUSANDS)

<TABLE>
<CAPTION>
CONVERTIBLE COMMON STOCK
PREFERRED STOCK --------------- DEFERRED ACCUMULATED
(SERIES A AND B) SHARES AMOUNT COMPENSATION DEFICIT TOTAL
------------------ ------ ------- ------------ ----------- -------
<S> <C> <C> <C> <C> <C> <C> <C>
Initial issuance of
Common Stock, September
20, 1995............... -- $ -- 6,623 $ 5 $ -- $ -- $ 5
Repurchase of Common
Stock.................. -- -- (2,000) (2) -- -- (2)
Issuance of Common
Stock.................. -- -- 4,233 85 -- -- 85
Issuance of Convertible
Preferred Stock........ 1,791 1,620 -- -- -- -- 1,620
Net loss................ -- -- -- -- -- (308) (308)
-------- -------- ------ ------- ------ -------- -------
Balance at December 31,
1995.................. 1,791 1,620 8,856 88 -- (308) 1,400
Repurchase of Common
Stock.................. -- -- (116) (2) -- -- (2)
Exercise of stock
options................ -- -- 74 11 -- -- 11
Issuance of Series B
Convertible Preferred
Stock ................. 157 545 -- -- -- -- 545
Net loss................ -- -- -- -- -- (13,897) (13,897)
-------- -------- ------ ------- ------ -------- -------
Balance at December 31,
1996.................. 1,948 2,165 8,814 97 -- (14,205) (11,943)
Exercise of stock
options................ -- -- 726 103 -- -- 103
Issuance of Series B
Convertible Preferred
Stock, ................ 68 445 -- -- -- -- 445
Deferred compensation... -- -- -- 272 (272) -- --
Amortization of deferred
compensation........... -- -- -- -- 10 -- 10
Net loss................ -- -- -- -- -- (36,526) (36,526)
-------- -------- ------ ------- ------ -------- -------
Balance at December 31,
1997.................. 2,016 2,610 9,540 472 (262) (50,731) (47,911)
Exercise of stock
options (unaudited).... -- -- 517 159 -- -- 159
Issuance of Series B
Convertible Preferred
Stock (unaudited)...... 64 446 -- -- -- -- 446
Deferred compensation
(unaudited)............ -- -- -- 1,054 (1,054) -- --
Conversion of Preferred
Stock (unaudited)...... (2,080) (3,056) 15,191 80,897 -- -- 77,841
Amortization of deferred
compensation
(unaudited)............ -- -- -- -- 356 -- 356
Net loss (unaudited).... -- -- -- -- -- (27,054) (27,054)
-------- -------- ------ ------- ------ -------- -------
Balance at September
28, 1998 (unaudited).. -- $ -- 25,248 $82,582 $ (960) $(77,785) $ 3,837
======== ======== ====== ======= ====== ======== =======
</TABLE>

See accompanying notes to consolidated financial statements.

F-26
<PAGE>

CITYSEARCH, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS
(IN THOUSANDS)

<TABLE>
<CAPTION>
PERIOD FROM
SEPTEMBER 20, YEAR ENDED
1995 (DATE OF DECEMBER 31, NINE MONTHS ENDED
FORMATION) TO ------------------ ---------------------------
DECEMBER 31, SEPTEMBER 30, SEPTEMBER 28,
1995 1996 1997 1997 1998
------------- -------- -------- ------------- -------------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
OPERATING ACTIVITIES
Net loss................ $ (308) $(13,897) $(36,526) $(26,773) $(27,054)
Adjustments to reconcile
net loss to net cash
used in
operating activities:
Equity interest in
loss from
partnership........... -- -- 259 113 --
Write-down of
investment in
partnership........... -- -- 321 321 --
Depreciation........... 5 325 1,841 1,087 2,291
Amortization........... -- 422 1,915 1,436 --
Change in operating
assets and
liabilities, net of
assets
acquired and
liabilities assumed:
Accounts receivable.. -- (34) (67) (62) (163)
Due from licensees... -- -- (57) (177) (1,410)
Due from licensees--
related party....... -- -- (136) (9) (70)
Prepaid expenses and
other current
assets.............. -- (249) 129 (53) (59)
Accounts payable..... 90 2,537 317 (763) 370
Accrued payroll and
related liabilities. -- -- 489 616 607
Other accrued
liabilities......... -- -- (221) 193 1,638
Deferred subscription
and license revenue. -- 327 1,510 1,174 100
Deferred rent........ -- 33 157 79 14
Deferred
compensation........ -- -- -- -- 356
------ -------- -------- -------- --------
Net cash used in
operating activities... (213) (10,536) (30,069) (22,818) (23,380)
INVESTING ACTIVITIES
Purchases of software,
equipment and
leasehold improvements. (82) (3,547) (1,391) (1,098) (171)
Investment in
partnership............ -- -- (580) (324) --
------ -------- -------- -------- --------
Net cash used in
investing activities... (82) (3,547) (1,971) (1,422) (171)
FINANCING ACTIVITIES
Payments on capital
leases................. -- (121) (840) (372) (917)
Exercise of stock
options................ -- 11 103 84 159
Issuance of Common
Stock.................. 90 -- -- -- --
Repurchases of Common
Stock.................. (2) (2) -- -- --
Convertible promissory
note payable to a
related party.......... -- -- -- -- 50,000
Issuance of Convertible
Preferred Stock, net... 1,620 20,309 50,477 18,274 6,959
------ -------- -------- -------- --------
Net cash provided by
financing activities... 1,708 20,197 49,740 17,986 56,201
------ -------- -------- -------- --------
Net increase (decrease)
in cash and cash
equivalents............ 1,413 6,114 17,700 (6,254) 32,650
Cash and cash
equivalents at
beginning of period.... -- 1,413 7,527 7,527 25,227
------ -------- -------- -------- --------
Cash and cash
equivalents at end of
period................. $1,413 $ 7,527 $ 25,227 $ 1,273 $ 57,877
====== ======== ======== ======== ========
Supplemental disclosure
of cash flow
information:
Cash paid for:
Interest............. $ -- $ 12 $ 271 $ 169 $ 329
Income taxes......... $ 1 $ 2 $ 8 $ -- $ --
</TABLE>

See accompanying notes to consolidated financial statements.

F-27
<PAGE>

CITYSEARCH, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS
(IN THOUSANDS, EXCEPT SHARE DATA)

NON-CASH INVESTING AND FINANCING ACTIVITIES

During 1996 and 1997, the Company purchased computers and office equipment
under financing leases totaling $288 and $2,820, respectively.

On June 19, 1996, the Company acquired Metrobeat, Inc. in exchange for an
initial payment of Series B Convertible Preferred Stock valued at $544. During
the year ended December 31, 1997 and the nine months ended September 30, 1998,
the Company made its second and third annual installment of Series B
Convertible Preferred Stock valued at $445 and $445, respectively, pursuant to
the acquisition. The remaining purchase price of $446 is payable in two annual
installments, principally of Series B Convertible Preferred Stock.

During 1997, the Company issued 14,670 shares of Series D Redeemable
Convertible Preferred Stock valued at $96 as payment for accrued advertising
and recruiting fees.

During the nine months ended September 30, 1997 and September 28, 1998, the
Company purchased computers and office equipment under financing leases
totaling $1,836 and $1,350, respectively.

See accompanying notes to consolidated financial statements.

F-28
<PAGE>

CITYSEARCH, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(INFORMATION AT SEPTEMBER 28, 1998 AND FOR THE NINE MONTHS ENDED
SEPTEMBER 30, 1997 AND SEPTEMBER 28, 1998 IS UNAUDITED)

1. DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

THE COMPANY AND BASIS OF PRESENTATION

CitySearch, Inc. (the Company), a Delaware corporation, was organized on
September 20, 1995. The Company and its wholly-owned subsidiaries, Metrobeat,
Inc. (Metrobeat) and CitySearch Ontario, Inc. (CitySearch Ontario), produce
and deliver comprehensive local city guides on the World Wide Web (the Web),
providing up-to-date information regarding arts and entertainment events,
community activities, recreation, business, shopping, professional services
and news/sports/weather to consumers in metropolitan areas. Each local city
guide consists primarily of original content developed and designed
specifically for the Web by the Company and its media partners. The Company
designs and produces custom-built Web sites and related services for local
businesses, aggregates them in a local city guide environment and provides
business customers the ability to regularly update and expand their sites.

The Company has two primary means of providing its local city guides. In its
owned and operated markets the Company systematically produces the majority of
its own content, hires and rapidly deploys a direct sales force to sell
custom-built business Web sites as well as related services to local and
regional businesses and launches a presence in the market. In its other
markets, the Company contracts with a local media company to provide
assistance in developing, designing and launching a city guide. Under these
contracts, the partners license the Company's business and technology systems
and pay a license fee and make royalty payments to the Company based on
certain revenues generated by the media partner from the operation of their
sites and pay the Company for additional consultation and design services not
provided for under the license fee.

Subscription and services revenues include revenue generated from the sale
of subscriptions for custom-built business Web sites (designed and developed
by the Company) and advertising on its owned and operated city guides on the
Internet, and the performance of consultation and design services. Licensing
and royalty revenues include revenues generated from the sale of licenses for
the use of the Company's business and technology systems in its partner-led
markets and the receipt of royalty payments under its license agreements. See
Revenue Recognition.

The cost of designing and developing custom-built business Web sites in the
Company's owned and operated markets and the cost of providing other design
and consultation services including the cost of developing, designing and
launching a city guide in partner-led-markets is included, as incurred, in the
cost of revenues. The cost of developing, designing and launching a city
guide, that is not separately billable under license agreements as services
revenue in the Company's partner-led markets, is not significant and is
included, as incurred, in the cost of revenues. Any ongoing customer support
or upgrades, after the launch of the Web site that is not separately billable
under the licensing contract is insignificant.

Customers include restaurants, taverns, movie theaters, museums and retail
stores. The Company currently owns and operates sites in Austin, TX,
Nashville, TN, New York, NY, Portland, OR, Raleigh-Durham-Chapel Hill, NC,
Salt Lake City, UT, Los Angeles, CA, and San Francisco, CA. Through
partnership and licensing agreements, the Company has an internet presence in
Washington D.C., Melbourne and Sydney, Australia, and Toronto, Canada.

The Company has experienced operating losses and negative cash flows from
operations since its formation on September 20, 1995. Since its formation, the
Company has raised significant capital through the sale of Convertible
Preferred Stock to outside investors and expects to continue to raise capital
in 1998. The Company has also successfully licensed its product domestically
and internationally generating additional revenue streams.

F-29
<PAGE>

CITYSEARCH, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

(INFORMATION AT SEPTEMBER 28, 1998 AND FOR THE NINE MONTHS ENDED
SEPTEMBER 30, 1997 AND SEPTEMBER 28, 1998 IS UNAUDITED)

Management anticipates that its investment in new markets and technology will
result in operating losses in the near term but believes that anticipated
revenues, existing cash, cash equivalents, working capital and new capital
contributions will be sufficient to fund operations over the next year.

PRINCIPLES OF CONSOLIDATION

The accompanying consolidated financial statements include the accounts of
the Company and its wholly-owned subsidiaries, Metrobeat and CitySearch
Ontario. All significant intercompany amounts have been eliminated.

INTERIM FINANCIAL INFORMATION

The accompanying balance sheet as of September 28, 1998, the statements of
operations and cash flows for the nine months ended September 30, 1997 and
September 28, 1998 and the statement of changes in shareholders equity
(deficit) for the nine months ended September 28, 1998 are unaudited.
References to the nine months ended September 28, 1998 refer to the period
from January 1, 1998 through September 28, 1998. In the opinion of management,
the statements have been prepared on the same basis as the audited financial
statements and include all adjustments, consisting of normal recurring
adjustments, necessary for the fair statement of interim periods. The data
disclosed in these notes to the financial statements for these periods is also
unaudited. The results of operations and cash flows for the interim period are
not necessarily indicative of the results to be expected for any other interim
future period.

ESTIMATES USED IN THE PREPARATION OF CONSOLIDATED FINANCIAL STATEMENTS

The preparation of consolidated financial statements in conformity with
generally accepted accounting principles requires management to make estimates
and assumptions that affect the amounts reported in the consolidated financial
statements and the accompanying notes. Actual results could differ from those
estimates, although management does not believe that any differences would
materially affect the Company's consolidated financial position or results of
operations.

REVENUE RECOGNITION

The Company recognizes subscription revenues over the period the services
are provided. Licensing revenue, under agreements entered into prior to
December 31, 1997, for partner-led markets is recognized upon the completion
of the delivery and installation of the business and technology systems and
training of partner personnel in each partner-led-market. Royalty revenues are
recognized when earned based on the revenues generated by the license or based
on the minimum royalty provisions in the contract. Revenue from consultation
and design services is recognized as the services are provided. Advertising
revenues, which have not been significant, are recognized as earned and are
included in subscription and service revenues. Any ongoing customer support
costs or upgrades, after the launch of the Web site, that are not separately
billable under the licensing contract are insignificant.

Effective January 1, 1998, the Company adopted Statement of Position 97-2
(SOP 97-2), "Software Revenue Recognition," which impacts the manner companies
recognize revenue on sales and licensing of software. The Company, during
1997, accounted for licensing of its software under the provisions of SOP 91-
1. The Company does not sell certain undelivered elements under its license
agreements separately and, accordingly, under the provisions of SOP 97-2
revenues from the sale of licenses for use of the Company's business and
technology systems to its partner-led markets are recognized over the term of
the license agreement or the period over which the relevant services are
delivered. The Company's license agreements have terms

F-30
<PAGE>

CITYSEARCH, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

(INFORMATION AT SEPTEMBER 28, 1998 AND FOR THE NINE MONTHS ENDED
SEPTEMBER 30, 1997 AND SEPTEMBER 28, 1998 IS UNAUDITED)

ranging from five to nine years. Licensing and royalty revenues, on a pro
forma basis, for the year ended December 31, 1997, and the nine months ended
September 30, 1997 and September 28, 1998 would have been $253,000, $132,000
and $783,000, respectively, had SOP 97-2 been effective January 1, 1997. SOP
97-2 is not expected to have a material effect on revenues from royalties,
services, and subscriptions.

Deferred revenues arise upon the prepayment of subscription services and
license agreements.

CASH EQUIVALENTS

The Company considers all highly liquid investments with a maturity of three
months or less when purchased to be cash equivalents.

CONCENTRATION OF CREDIT RISK

Financial instruments that potentially subject the Company to concentrations
of credit risk consist principally of trade accounts receivable and cash
deposits at financial institutions. Concentration of credit risk with respect
to trade receivables is limited due to the large number of customers and their
geographic dispersion. The Company requires no collateral from its customers.

The Company places its cash deposits with high-credit quality financial
institutions. At times, balances in the Company's cash accounts may exceed the
Federal Deposit Insurance Corporation (FDIC) limit.

COMPUTERS, SOFTWARE, EQUIPMENT AND LEASEHOLD IMPROVEMENTS

RESEARCH AND DEVELOPMENT

MERGER AND OTHER TRANSACTIONS COSTS

Merger and other transactions costs consist of costs related to the Merger,
costs related to an initial public offering that was cancelled and costs
related to a previous merger transaction that was not consummated.

ADVERTISING COSTS

Advertising costs are expensed as incurred. Advertising costs for the years
ended December 31, 1996 and 1997, amounted to $1,305,859 and $2,464,641,
respectively. There was no advertising expense for the period from September
20, 1995 (date of formation) to December 31, 1995.

F-31
<PAGE>

CITYSEARCH, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

(INFORMATION AT SEPTEMBER 28, 1998 AND FOR THE NINE MONTHS ENDED
SEPTEMBER 30, 1997 AND SEPTEMBER 28, 1998 IS UNAUDITED)

During 1996 and 1997 the Company entered into several barter arrangements
whereby the Company has assisted in the design of a Web site in exchange for
broadcast advertising. The fair value of services provided and the services
received in the barter arrangement is not readily determinable and therefore
is not used to measure the value of the broadcast advertising received. The
Company valued these barter transactions at $60,000 and $1,158,000 for the
years ended December 31, 1996 and 1997, respectively, based on the estimated
cost of the specific services provided by the Company. Such amounts are
included in subscription and services revenue as well as recognized in sales
and marketing expense in the accompanying consolidated statements of
operations. Reciprocal noncash barter advertising on the Internet is not
valued in the consolidated financial statements because of the immateriality
of the associated costs and the indeterminable fair value.

PRO FORMA AND HISTORICAL NET LOSS PER SHARE

Pro forma net loss per share is computed using the weighted average number
of shares of Common Stock outstanding. Common equivalent shares from
Convertible Preferred Stock (using the if converted method) have been included
in the computation when dilutive, except that the Convertible Preferred Stock
which converted into Common Stock in connection with the Merger is included as
if converted at the original date of issuance, for both basic and diluted net
loss per share, even though inclusion is antidilutive, based on the conversion
price disclosed in Note 6.

Historical net loss per share is computed as described above except that it
excludes the Convertible Preferred Stock because it is antidilutive for
periods which incurred a net loss.

INTANGIBLE ASSET

The intangible asset is stated at cost and consists of goodwill resulting
from the purchase of Metrobeat in June 1996 (see Note 2).

IMPAIRMENT OF LONG-LIVED ASSETS AND LONG-LIVED ASSETS TO BE DISPOSED OF

In accordance with Statement of Financial Accounting Standards Board No.
121, "Accounting for the Impairment of Long-Lived Assets and Long-Lived Assets
to Be Disposed Of," the Company periodically reviews long-lived assets and
certain identifiable intangibles for impairment whenever events or changes in
circumstances indicate that the carrying amount of an asset may not be
recoverable. Recoverability of assets to be held and used is measured by a
comparison of the carrying amount of an asset to future net cash flows (on an
undiscounted basis) expected to be generated by the asset. If such assets are
considered to be impaired, the impairment to be recognized is measured by the
amount by which the carrying amount of the assets exceeds the fair value of
the assets.

STOCK-BASED COMPENSATION

Statement of Financial Accounting Standards No. 123, "Accounting for Stock-
Based Compensation" (SFAS 123), requires that stock awards granted subsequent
to January 1, 1995, be recognized as compensation expense based on their fair
value at the date of grant. Alternatively, a company may use Accounting
Principles Board Opinion No. 25 (APB 25), "Accounting for Stock Issued to
Employees," and disclose pro forma results of operations which would have
resulted from recognizing such awards at their fair value. The Company will
continue to account for stock-based compensation under APB 25 and make the
required pro forma disclosures for compensation (see Note 8). Under APB 25
compensation expense is calculated based on the difference

F-32
<PAGE>

CITYSEARCH, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

(INFORMATION AT SEPTEMBER 28, 1998 AND FOR THE NINE MONTHS ENDED
SEPTEMBER 30, 1997 AND SEPTEMBER 28, 1998 IS UNAUDITED)

between the exercise price and the fair market value of the underlying stock
on the date of grant. The amount of compensation expense calculated under APB
25 is recognized over the vesting period of the options.

RECLASSIFICATIONS

Certain reclassifications have been made to the prior years' balances to
conform to the current year presentation.

2. ACQUISITION OF METROBEAT

On June 19, 1996, the Company purchased Metrobeat for approximately
$2,337,300. The Company assumed net liabilities of $456,303 and issued 157,074
shares of Series B Convertible Preferred Stock valued at $544,497. During the
year ended December 31, 1997 and the nine months ended September 28, 1998, the
Company made its second and third annual installment of Series B Convertible
Preferred Stock valued at $445,495 and $445,494, respectively. The remaining
purchase price of $445,506 is payable in one annual installment, principally
of Series B Convertible Preferred Stock . The remaining installment has been
recorded as a deferred purchase price liability in the accompanying
consolidated balance sheets. The transaction was accounted for using the
purchase method of accounting. The excess of the purchase price over the net
assets acquired has been allocated to goodwill and was initially to be
amortized over three years. Effective January 1, 1997, the Company reassessed
the future life of the goodwill recorded in connection with the Metrobeat
acquisition and concluded the remaining life was one year. Accordingly, the
unamortized goodwill as of December 31, 1996 was fully amortized to expense in
1997.

3. INVESTMENT IN PARTNERSHIP

On February 17, 1997, CitySearch Ontario entered into a partnership, Toronto
Star CitySearch (the Partnership), with others to launch CitySearch sites in
Canada. CitySearch Ontario contributed the Company's technology through a
licensing agreement valued by the other partners at $390,500 and cash of
$319,171 in exchange for a 20% interest in the partnership. The other partners
collectively contributed cash of $2,811,600 in exchange for the remaining 80%
interest. Profits are shared in accordance with the respective Partnership
interests. Losses are allocated to one of the other partners up to a
cumulative loss limit, and thereafter losses of the partnership shall be
allocated to CitySearch Ontario and the other partners at a ratio of 10% and
90%, respectively. CitySearch Ontario is committed to funding up to 10% of any
losses of the Partnership. In August 1998, the Company entered into a series
of agreements which effectively admitted a new party to the Partnership,
reduced the Company's interest in the Partnership to 10% and terminated its
commitment to fund any losses of the Partnership.

Summarized unaudited financial information of Toronto Star CitySearch as of
and for the year ended December 31, 1997 is as follows (in thousands):

<TABLE>
<S> <C>
As of December 31, 1997:
Current assets.................................................... $ 1,520
Total liabilities................................................. 2,006
Partners' capital................................................. 758
For the period ended December 31, 1997:
Revenues.......................................................... $ 123
Loss from operations.............................................. (2,658)
Net loss.......................................................... (2,806)
</TABLE>

F-33
<PAGE>

CITYSEARCH, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

(INFORMATION AT SEPTEMBER 28, 1998 AND FOR THE NINE MONTHS ENDED
SEPTEMBER 30, 1997 AND SEPTEMBER 28, 1998 IS UNAUDITED)

CitySearch Ontario carries its investment in Toronto Star CitySearch at
zero. CitySearch Ontario's share of partnership losses ($258,937) is included
in costs of revenues and sales and marketing expenses.

4. INCOME TAXES

Deferred tax assets and liabilities are determined based on differences
between the financial reporting and tax bases of assets and liabilities
measured using the enacted tax rates and laws that will be in effect when the
differences are expected to reverse. Deferred tax expense is determined by the
change in the net asset or liability for deferred taxes.

The provision for income, franchise and capital taxes of $800, $1,600 and
$8,330 is based solely on minimum state tax requirements. The Company's
effective tax rate differs from the statutory federal income tax rate,
primarily as a result of operating losses not benefited.

The tax effect of temporary differences resulted in net deferred income tax
assets and liabilities at December 31 are as follows:

<TABLE>
<CAPTION>
1996 1997
------- --------
(IN THOUSANDS)
<S> <C> <C>
Deferred tax assets:
Net operating loss and tax credits...................... $ 5,485 $ 21,239
Various accruals........................................ 58 636
Deferred rent........................................... 14 77
------- --------
5,557 21,952
Less valuation allowance................................ (5,103) (19,650)
------- --------
Net deferred tax assets................................... 454 2,302
Deferred tax liabilities:
Federal benefit for state income taxes.................. (427) (1,499)
Excess of tax depreciation and amortization............. (27) (803)
------- --------
Deferred tax liabilities.................................. (454) (2,302)
------- --------
$ -- $ --
======= ========
</TABLE>

Due to the uncertainty surrounding the timing of the realization of the
benefits from its favorable tax attributes in future tax returns, the Company
has placed a valuation allowance against its otherwise recognizable deferred
tax assets. The Company had federal and state operating loss carryforwards of
$47,450,000 at December 31, 1997. The federal carryforwards expire principally
in the period from 2010 to 2012, and the state carryforwards expire
principally in 2003. The Company has generated tax credit carryforwards for
federal and state purposes in the amounts of $329,723 and $107,353,
respectively, at December 31, 1997. Utilization of the above carryforwards is
subject to utilization limitations which may inhibit the Company's ability to
use carryforwards in the future.

F-34
<PAGE>

CITYSEARCH, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

(INFORMATION AT SEPTEMBER 28, 1998 AND FOR THE NINE MONTHS ENDED
SEPTEMBER 30, 1997 AND SEPTEMBER 28, 1998 IS UNAUDITED)

The following table reconciles the provision for taxes based on income
before taxes to the statutory federal income tax rate of 35%:

<TABLE>
<CAPTION>
PERIOD FROM
SEPTEMBER 20,
1995 (DATE OF YEAR ENDED
FORMATION TO DECEMBER 31,
DECEMBER 31, -----------------
1995 1996 1997
------------- ------- --------
(IN THOUSANDS)
<S> <C> <C> <C>
Tax benefit at statutory rate.............. $(108) $(4,864) $(12,781)
Increase related to:
State taxes, net of federal benefit........ 1 1 5
Meals and entertainment.................. 1 17 30
Amortization of goodwill................. -- 143 670
Foreign operations....................... -- -- 203
Valuation reserve on deferred taxes...... 106 4,705 11,881
----- ------- --------
$ -- $ 2 $ 8
===== ======= ========
</TABLE>

5. COMMITMENTS

LEASES

The Company entered into noncancelable capital lease obligations for
computers and equipment during the year ended December 31, 1997. In addition,
the Company leases its facilities and other office equipment under
noncancelable operating lease agreements expiring through 2004. Certain of the
Company's leases provide for free rent and escalations. The Company is
responsible for other costs such as property taxes, insurance, maintenance and
utilities.

The following is a schedule of future minimum lease payments:

<TABLE>
<CAPTION>
OPERATING CAPITAL
LEASES LEASES
--------- -------
(IN THOUSANDS)
<S> <C> <C>
December 31:
1998.................................................... $1,321 $1,115
1999.................................................... 1,191 1,028
2000.................................................... 1,167 517
2001.................................................... 1,043 4
2002.................................................... 265 --
Thereafter.............................................. 332 --
------ ------
$5,319 $2,664
======
Less amount representing interest......................... 517
------
Net present value of net minimum lease payments (including
approximately $807 payable currently).................... $2,147
======
</TABLE>

F-35
<PAGE>

CITYSEARCH, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

(INFORMATION AT SEPTEMBER 28, 1998 AND FOR THE NINE MONTHS ENDED
SEPTEMBER 30, 1997 AND SEPTEMBER 28, 1998 IS UNAUDITED)

Computers, software and equipment under capital leases had an original cost
basis of $288,419 and $2,819,842 at December 31, 1996 and 1997, respectively.
The net book value of the related computers, software and equipment was
$231,267 and $2,157,717 at December 31, 1996 and 1997, respectively.

Rent expense related to operating leases was $7,800, $291,000 and $1,372,000
for the period from September 20, 1995 (date of formation) to December 31,
1995 and for the years ended December 31, 1996 and 1997, respectively.

6. CONVERTIBLE PREFERRED STOCK

At December 31, 1997 and September 28, 1998, the Company was authorized to
issue 14,741,082 and 15,741,082 shares, respectively, of Convertible Preferred
Stock with a par value of $0.01 per share. The Company has designated
1,791,173 shares as Series A Convertible Preferred Stock; 450,000 shares as
Series B Convertible Preferred Stock; 3,261,024 shares as Series C Redeemable
Convertible Preferred Stock; 4,430,313 shares as Series D Redeemable
Convertible Preferred Stock; and 5,808,572 shares as Series E Redeemable
Convertible Preferred Stock.

Convertible Preferred Stock issued and outstanding as of December 31, 1997
and September 28, 1998 are as follows:

<TABLE>
<CAPTION>
ORIGINAL AS CONVERTED
AMOUNT PER SHARE EFFECTIVE PER
SHARES (NET OF ISSUANCE SHARE COMMON
OUTSTANDING ISSUANCE COST) PRICE STOCK PRICE DATE FIRST ISSUED
----------- -------------- --------- ------------- -----------------
(IN THOUSANDS)
<S> <C> <C> <C> <C> <C>
Series A................ 1,791 $ 1,620 $0.904 $0.904 October 31, 1995
Series B................ 157 545 3.467 3.467 June 19, 1996
Series B................ 68 445 6.525 6.525 June 19, 1997
Series B................ 64 445 7.000 7.00 June 21, 1998
Series C................ 3,261 11,261 3.467 3.57 May 15, 1996
Series D................ 4,431 28,265 6.525 6.73 December 13, 1996
Series E................ 4,714 31,356 7.000 7.09 November 10, 1997
Series E................ 1,000 6,959 7.000 7.09 May 26, 1998
------ -------
15,486 $80,896
====== =======
</TABLE>

Convertible Preferred Stock contains a liquidation preference of an amount
per share equal to the price for which such share of Convertible Preferred
Stock was originally issued, adjusted for any stock dividends, combinations or
splits with respect to such shares, plus any declared and unpaid dividends on
the Convertible Preferred Stock. The Series C Redeemable Convertible Preferred
Stock contains a May 2006 mandatory redemption provision. The Series D and
Series E Redeemable Convertible Preferred Stock contain mandatory redemption
provisions with a minimum of an 80% favorable vote, by the holders, beginning
December 2004.

Each share of Convertible Preferred Stock shall be, at the option of the
holder, convertible at any time into the number of shares of Common Stock as
determined by dividing the original issue price by the conversion price, as
defined. At the date of issuance, the conversion price for each series of
Convertible Preferred Stock was equal to the original per share issuance
price. The conversion price is subject to adjustment for stock splits and
stock combinations of outstanding Common Stock. The conversion price for
Series C, D and E Redeemable Convertible Preferred Stock, is also adjusted for
the forfeiture of Common Stock options outstanding from the

F-36
<PAGE>

CITYSEARCH, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

(INFORMATION AT SEPTEMBER 28, 1998 AND FOR THE NINE MONTHS ENDED
SEPTEMBER 30, 1997 AND SEPTEMBER 28, 1998 IS UNAUDITED)

date of issuance to the date of conversion. The Convertible Preferred Stock
has an automatic conversion feature which provides for each share of
Convertible Preferred Stock to be automatically converted into shares of
Common Stock based on the then effective conversion price immediately upon the
closing of an underwritten public offering pursuant to an effective
registration statement under the Securities Act of 1933, as amended, covering
the offer and sale of shares of Common Stock priced above $7.70 per share,
with aggregate net proceeds to the Company of not less than $20,000,000. At
September 28, 1998, on an unaudited pro forma basis, giving effect to Common
Stock option forfeitures through June 30, 1998, each share of Series A and B
Convertible Preferred Stock, and Series C, D and E Redeemable Convertible
Preferred Stock, was convertible into approximately 1.0, 1.0, .972, .970 and
.988 shares of Common Stock, respectively.

The as-converted effective per share Common Stock price presented in the
table above represents the effective price paid by the holders of the
Convertible Preferred Stock for each share of Common Stock to be obtained upon
conversion. The Convertible Preferred Stock was converted into 15,191,189
shares of Common Stock upon consummation of the Merger and share
reclassification discussed in Note 10.

7. STOCK OPTIONS

The Company has adopted the 1996 Stock Option Plan (1996 Stock Plan) which
authorizes members of management to grant non-statutory stock options or
incentive stock options to employees and consultants of the Company and its
subsidiaries. As of December 31, 1997 and September 28, 1998 the maximum
number of shares of Common Stock to be issued under the plan was 4,000,000 and
5,500,000 shares, respectively. All options granted under the 1996 Stock Plan
have been made at prices not less than fair market value of the stock at the
date of grant. Options granted under the 1996 Stock Plan are exercisable at
various dates over their ten-year life. Options granted under the 1996 Stock
Plan vest principally 25% after the first year and ratably over the remaining
vesting period.

The following table summarizes certain information related to options for
Common Stock:

<TABLE>
<CAPTION>
WEIGHTED
AVERAGE
NUMBER OF PRICE PER EXERCISE
SHARES SHARE PRICE
-------------- -------------- --------
(IN THOUSANDS)
<S> <C> <C> <C> <C>
Balance at January 1, 1996............ --
Granted during 1996................. 3,221 $0.10 to $0.75 $0.25
Forfeited........................... 314 0.10 to 0.75 0.15
Exercised........................... 74 0.10 to 0.75 0.16
-----
Outstanding at December 31, 1996...... 2,833 0.10 to 0.75 0.26
Granted during 1997................. 1,110 0.75 to 3.00 1.83
Forfeited........................... 485 0.10 to 2.00 0.64
Exercised........................... 726 0.10 to 2.00 0.15
-----
Outstanding at December 31, 1997...... 2,732 0.10 to 3.00 0.86
Granted............................. 1,999 3.00 to 8.67 6.36
Forfeited........................... 322 0.10 to 8.00 2.12
Exercised........................... 517 0.10 to 7.00 0.32
-----
Outstanding at September 28, 1998..... 3,892 0.10 to 8.67 3.66
=====
</TABLE>

F-37
<PAGE>

CITYSEARCH, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

(INFORMATION AT SEPTEMBER 28, 1998 AND FOR THE NINE MONTHS ENDED
SEPTEMBER 30, 1997 AND SEPTEMBER 28, 1998 IS UNAUDITED)

Options granted during the year ended December 31, 1997 and the nine months
ended September 28, 1998 resulted in a total compensation amount of $272,000
and $1,054,000, respectively, and were recorded as deferred compensation in
stockholders equity. The deferred compensation amount will be recognized as
compensation expense over the vesting period. During the year ended December
31, 1997 and the nine months ended September 28, 1998, such compensation
expense amounted to $10,000 and $356,000, respectively. Options outstanding at
December 31, 1996 and 1997 were exercisable for 1,100,000 and 1,135,500 shares
of Common Stock, respectively. Common Stock available for future grants at
December 31, 1996 and 1997 were 1,093,500 and 544,500 shares, respectively.

Additional information with respect to outstanding options as of December
31, 1997 is as follows:

<TABLE>
<CAPTION>
OPTIONS OUTSTANDING
------------------------------------ OPTIONS EXERCISABLE
WEIGHTED- ------------------------
WEIGHTED- AVERAGE WEIGHTED-
RANGE OF AVERAGE REMAINING AVERAGE
EXERCISE NUMBER OF EXERCISE CONTRACTUAL NUMBER OF EXERCISE
PRICES SHARES PRICE LIFE SHARES PRICE
-------- --------- --------- ----------- --------- ---------
(IN THOUSANDS) (IN THOUSANDS)
<S> <C> <C> <C> <C> <C>
0.50 to
0.75 631 0.61 8.83 168 0.57
2.00 to
3.00 895 2.02 9.76 83 2.00
----- -----
0.10 to
3.00 2,732 1,136
===== =====
</TABLE>

In connection with the Series E Redeemable Convertible Preferred Stock
issuance in November 1997, the Company granted warrants to a private placement
selling agent to purchase 94,286 shares of Series E Redeemable Convertible
Preferred Stock at an exercise price of $8.75 per share in exchange for
services. The warrants expire upon a closing of an initial public offering or
five years from the grant date, whichever is earlier. The fair value of these
warrants was not material at the date of issuance and therefore was included
in the amount of Series E Redeemable Convertible Preferred Stock reflected in
the accompanying balance sheet.

Pro forma information regarding the effect on operations is required by SFAS
123, and has been determined as if the Company had accounted for its employee
stock options under the fair value method of that statement. The fair value
for these options was estimated at the date of grant using the minimum-value
method, which utilizes a near-zero volatility factor.

<TABLE>
<CAPTION>
1996 1997
------- -------
<S> <C> <C>
Expected life (years)...................................... 6 years 5 years
Risk-free interest rate.................................... 6.30% 6.30%
Dividend yield............................................. -- --
</TABLE>

This option valuation model requires input of highly subjective assumptions.
Because the Company's employee stock options have characteristics
significantly different from those of traded options, and because changes in
the subjective input assumptions can materially affect the fair value
estimate, in management's opinion, the existing model does not necessarily
provide a reliable single measure of the fair value of its employee stock
options.

F-38
<PAGE>

CITYSEARCH, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

(INFORMATION AT SEPTEMBER 28, 1998 AND FOR THE NINE MONTHS ENDED
SEPTEMBER 30, 1997 AND SEPTEMBER 28, 1998 IS UNAUDITED)

For purposes of pro forma disclosures, the estimated fair value of the
options is amortized to expense over the option's vesting period. The
Company's pro forma information follows:

<TABLE>
<CAPTION>
YEAR ENDED
DECEMBER 31,
------------------
1996 1997
-------- --------
(IN THOUSANDS)
<S> <C> <C>
Net loss, as reported.................................... $(13,897) $(36,526)
Pro forma net loss....................................... (13,953) (36,608)
Pro forma basic and diluted historical loss per share.... $ (1.59) $ (3.87)
Pro forma basic and diluted loss per share............... (1.10) (1.96)
</TABLE>

The effects of applying SFAS 123 in this pro forma disclosure may not be
indicative of future amounts. Additional awards in future years are
anticipated. The weighted-average fair value of options granted during the
years ended December 31, 1996 and 1997 was $0.19 and $0.56, respectively, for
options granted with an exercise price equal to the deemed fair market value,
at the date of grant, of the underlying Common Stock. The weighted-average
fair value of options, granted with an exercise price less than the deemed
fair market value, at the date of grant, of the underlying Common Stock during
1997 was $1.04.

8. DEFINED CONTRIBUTION PLAN

In July 1997, the Company established a defined contribution plan for
certain qualified employees as defined in the plan. Participants may
contribute from 1% to 20% of pretax compensation subject to certain
liabilities. The plan does provide for certain discretionary contributions by
the Company as defined in the plan. No Company contributions were made for the
year ended December 31, 1997.

9. RELATED PARTY TRANSACTIONS

Included in subscription and service-related party and license and royalty-
related party revenues for the year ended December 31, 1997 and the nine
months ended September 28, 1998 is approximately $1,044,000 and $1,497,000 of
revenues, respectively, generated under the Company's license agreements with
stockholders or other related parties. Included in due from licensees at
December 31, 1997 and September 28, 1998 is $136,000 and $206,000,
respectively, due from stockholders and other related parties.

10. MERGER AND RELATED EVENTS

On September 28, 1998 pursuant to an Amended and Restated Agreement and Plan
of Reorganization, dated as of August 12, 1998 (the Merger Agreement) by and
among the Company, USA Networks, Inc. (USAi), Ticketmaster Group, Inc.
(Ticketmaster Group), a wholly-owned subsidiary of USAi, Ticketmaster Corp., a
wholly-owned subsidiary of Ticketmaster Group, Ticketmaster Online and
Tiberius, Inc. (Tiberius), a wholly-owned subsidiary of CitySearch, Inc.,
whereby Tiberius was merged with and into Ticketmaster Online, with
Ticketmaster Online continuing as the surviving corporation and as a wholly-
owned subsidiary of CitySearch, Inc. Under the Merger Agreement, the Company
issued 37,238,000 shares of the Company's Common Stock in exchange for 100% of
the outstanding common stock of Ticketmaster Online. The Merger was accounted
for using the "reverse purchase" method of accounting, pursuant to which
Ticketmaster Online will be treated as the acquiring entity and for accounting
purposes the assets acquired and liabilities assumed of the Company will be
recorded at their respective fair values. Pursuant to the Merger Agreement,
USAi, the indirect parent of Ticketmaster Online, commenced a tender offer
(the Tender Offer) to purchase up to 2,924,339 shares of the

F-39
<PAGE>

CITYSEARCH, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(CONTINUED)

(INFORMATION AT SEPTEMBER 28, 1998 AND FOR THE NINE MONTHS ENDED
SEPTEMBER 30, 1997 AND SEPTEMBER 28, 1998 IS UNAUDITED)

Company's Common Stock for $8.67 per share. The Tender Offer is scheduled to
expire 20 days after its commencement. The Merger Agreement contains a put
option which provides that in the event of consummation of the Merger, if a
Qualified IPO, as defined, is not closed within twelve, eighteen and
twenty-four months following the date of the Merger Agreement, the holders of
the Company's Common Stock could, subject to certain conditions, require USAi
to commence an exchange offer for all the then-outstanding shares of Common
Stock.

In addition, concurrently with the execution of the Merger Agreement, the
Company received a $50 million loan from USAi in exchange for the convertible
promissory note (the Convertible Note). The Convertible Note, in the principal
amount of $50 million, bears interest at a rate per annum of 7.00% and, after
consummation of the Merger, is generally due and payable on the earlier to
occur of (a) August 13, 2005 or (b) 20 days following the closing of a
Qualified IPO, as defined.

Upon consummation of the Merger, the Company amended its Certificate of
Incorporation and Bylaws to provide for, among other things, the authorization
of 100,000,000 shares of Class A Common Stock, 250,000,000 shares of Class B
Common Stock and 2,883,506 shares of Class C Common Stock. In addition, upon
consummation of a share reclassification immediately following the Merger,
each share of the Company's outstanding Common Stock was converted into one
share of Class A Common Stock entitled to 15 votes per share.

In connection with the Merger, all the Convertible Preferred Stock
outstanding converted into Common Stock. Such shares of Common Stock were
subsequently reclassified as shares of Class A Common Stock.

F-40
<PAGE>

[This page will be divided by a vertical line roughly two-thirds of the
distance across the page. The upper left two-thirds of the page will contain a
selection of five citysearch.com screen shots of the custom Web sites
purchased by CitySearch business customers. The screen shots will represent
business customers in a variety of service categories (e.g., restaurants,
professional services, entertainment venues, etc.) The lower left one-third of
the page will contain screen shots depicting Ticketmaster Online's
transactional features for purchasing merchandise and music products. The
right one-third of the page will contain four boxes. The first box will
contain the names and/or logos of the Company's domestic partners, including
washingtonpost.com, Los Angeles Times, The Baltimore Sun, The Dallas Morning
News and The San Diego Union-Tribune. The second box will contain the names
and/or logos of the Company's international partners organized by the city in
which the partner's service is available, including The Age, The Sydney
Morning Herald, Big Colour Pages, the Toronto Star, Tele-Direct, Schibsted and
Scandinavia Online. The third box will contain the names and/or logos of
certain of the businesses with which the Company has strategic relationships,
including New York Daily News and Classified Ventures. The fourth box will
contain the names and/or logos of certain of the Company's marketing partners,
including Yahoo! and American Express.]
<PAGE>

- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------

No dealer, salesperson or other person has been authorized to give any
information or to make any representations other than those contained in this
Prospectus in connection with this offering and, if given or made, such
information or representation must not be relied upon as having been authorized
by the Company or any Underwriter. This Prospectus does not constitute an offer
to sell or a solicitation of an offer to buy any securities offered hereby in
any jurisdiction to any person to whom it is unlawful to make such offer in
such jurisdiction. Neither the delivery of this Prospectus nor any sale made
hereunder shall, under any circumstances, create any implication that the
information herein is correct as of any time subsequent to the date hereof or
that there has been no change in the affairs of the Company since such date.

--------------------------

TABLE OF CONTENTS

--------------------------

<TABLE>
<CAPTION>
Page
----
<S> <C>
Prospectus Summary........................................................ 3
Risk Factors.............................................................. 12
Use of Proceeds........................................................... 35
Dividend Policy........................................................... 35
Capitalization............................................................ 36
Dilution.................................................................. 37
Selected Historical Financial Data........................................ 38
Selected Unaudited Pro Forma Combined Financial Data...................... 42
Management's Discussion and Analysis of Financial Condition and Results of
Operations............................................................... 43
Business.................................................................. 55
Management................................................................ 76
Principal Stockholders.................................................... 87
Ticketmaster Online-CitySearch Merger..................................... 93
Certain Transactions...................................................... 95
Description of Capital Stock.............................................. 98
Shares Eligible for Future Sale........................................... 103
Underwriting.............................................................. 105
Legal Matters............................................................. 107
Experts................................................................... 107
Additional Information.................................................... 107
Index to Financial Statements............................................. F-1
</TABLE>

---------------

Until , 1998 (25 days after the date of this Prospectus), all dealers
effecting transactions in the Class B Common Stock, whether or not
participating in this distribution, may be required to deliver a Prospectus.
This is in addition to the obligation of dealers to deliver a Prospectus when
acting as Underwriters and with respect to their unsold allotments or
subscriptions.

- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------

7,000,000 SHARES

[TICKETMASTER ONLINE LOGO]

[CITYSEARCH LOGO]
CLASS B COMMON STOCK

---------------

PROSPECTUS

---------------

NationsBanc Montgomery
Securities LLC

Allen & Company Incorporated

BancBoston
Robertson Stephens

Bear, Stearns & Co. Inc.

Donaldson, Lufkin & Jenrette
Securities Corporation

, 1998

- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>

PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 13. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION

The following table sets forth the costs and expenses, other than
underwriting discounts, commissions and certain accountable expenses, expected
to be incurred by the Company in connection with the sale of Class B Common
Stock being registered. All amounts are estimates except the Commission
registration fee and the National Association of Securities Dealers, Inc.
("NASD") filing fee.

<TABLE>
<S> <C>
SEC Registration Fee.......................................... $ 27,140
NASD Filing Fee............................................... 9,700
Nasdaq Listing Fee............................................ 90,000
Printing Fees and Expenses.................................... 150,000
Legal Fees and Expenses....................................... 700,000
Accounting Fees and Expenses.................................. 350,000
Blue Sky Fees and Expenses.................................... 5,000
Transfer Agent and Registrar Fees............................. 15,000
Miscellaneous................................................. 53,160
----------
Total....................................................... $1,400,000(1)
==========
</TABLE>
- --------

(1) In connection with this offering, the Representatives have agreed to
reimburse the Company for up to $562,500 of out-of-pocket expenses
incurred by the Company, which reimbursement shall be based upon the gross
proceeds of this offering. Based on the offering of 7,000,000 shares of
Class B Common Stock hereby, at the assumed initial public offering price
of $9.00 per share, there will be no such reimbursement.

ITEM 14. INDEMNIFICATION OF DIRECTORS AND OFFICERS

Section 145 of the DGCL permits a corporation to include in its charter
documents, and in agreements between the corporation and its directors and
officers, provisions expanding the scope of indemnification beyond that
specifically provided by the current law.

The Registrant's Restated Certificate of Incorporation provides for the
indemnification of directors to the fullest extent permissible under Delaware
law.

The Registrant's Bylaws provide for the indemnification of officers,
directors and third parties acting on behalf of the Registrant if such person
acted in good faith and in a manner reasonably believed to be in and not
opposed to the best interest of the Registrant, and, with respect to any
criminal action or proceeding, the indemnified party had no reason to believe
his conduct was unlawful.

ITEM 15. RECENT SALES OF UNREGISTERED SECURITIES

Since inception of Registrant (September 20, 1995), the Registrant has
issued and sold the following unregistered securities:

(1) From September 20, 1995 to September 30, 1998, CitySearch granted
options to purchase 6,338,118 shares of CitySearch Common Stock pursuant to
its 1996 Stock Plan at exercise prices ranging from $0.10 to $8.67 per
share (or 6,338,118 shares of Class A Common Stock pursuant to the
Reclassification).

(2) From September 20, 1995 to September 30, 1998, CitySearch issued and
sold an aggregate of 1,316,932 shares of Common Stock (or 1,316,932 shares
of Class A Common Stock pursuant to the Reclassification) to its employees,
directors and consultants upon exercise of stock options granted pursuant
to its 1996 Stock Plan at exercise prices ranging from $0.10 to $8.00 per
share for an aggregate consideration of approximately $273,000.

II-1
<PAGE>

(3) In September 1995, at CitySearch's formation, CitySearch issued and
sold 6,622,857 shares of CitySearch Common Stock (or 6,622,857 shares of
Class A Common Stock pursuant to the Reclassification) to William Gross for
an aggregate cash consideration of $5,000 and for services provided to
CitySearch.

(4) In October 1995, CitySearch issued and sold an aggregate of 4,233,500
shares of CitySearch Common Stock (or 4,233,500 shares of Class A Common
Stock pursuant to the Reclassification) for an aggregate cash consideration
of $84,670. These shares were issued to the following key founding
employees: Charles Conn, III; Thomas Layton; Jeffrey Brewer; Kristen Ding;
Caskey Dickson; David Holtz; Tamar Halpern; Brad Haugaard; Taylor Wescoatt;
Linda Gross; Karen DeDea; Lee Husiuk and Michael Radford.

(5) From November 1995 to December 1995, CitySearch issued and sold an
aggregate of 1,791,173 shares of its Series A Preferred Stock (or 1,791,173
shares of Class A Common Stock pursuant to the Reclassification) for an
aggregate cash consideration of approximately $1.6 million. Such shares
were issued to the following: David M. Balkin; Robert McLean; Morris
Ventures; Robert W. Shaw, Jr.; Philip E. Berney; WS Investment Company 95B;
William N. Melton; Stuart Cohen; Robert Kavner; Edwin C. Cohen; Peter R.
Bleyleben; Steven Spielberg; Gerald Breslauer; Barry S. Volpert; Pando
Associates, Ltd.; John Wylie; Jeffrey Glynn and Victoria Jo Edwards, Co-
Trustees of the Edwards Family Trust of 1995; Charles R. Conn, II; Taylor
Wescoatt; North American Trust Co., TTEE FBO L&W Dickson #410280.

(6) In June 1996, CitySearch issued an aggregate of 157,074 shares of
Series B Preferred Stock (or 157,074 shares of Class A Common Stock
pursuant to the Reclassification) at $3.4665 per share as part
consideration for the acquisition of MetroBeat. Such shares were issued to
the following shareholders of MetroBeat: Mark Davies and Joshua White.

(7) From May 1996 to July 1996, CitySearch issued and sold an aggregate
of 3,261,024 shares of Series C Preferred Stock (or 3,170,356 shares of
Class A Common Stock pursuant to the Conversion and the Reclassification)
for an aggregate cash consideration of approximately $11.3 million. Such
shares were issued to the following: GS Capital Partners II, L.P; GS
Capital Partners II Offshore, L.P.; Goldman, Sachs & Co. Verwaltungs GmbH;
The Goldman Sachs Group, L.P.; AT&T Venture Fund I, L.P.; AT&T Venture Fund
II, L.P.; Steven Spielberg; Edwin C. Cohen; Pamela C. Alexander; Barry S.
Volpert; Alexander Communications, Inc.; Jeffrey G. Edwards; IRA MSTC
Custodian; Morris Ventures; Byters; David White; Robert W. Shaw, Jr.;
Charles R. Conn, II; The Pacific Bank, N.A., Trustee E. Keith Thomson IRA;
Michael Barton; Eric Higgs; Mark Lewyn; Emily Martin; Douglas M. McPherson;
Ted Meisel.

(8) From December 1996 to October 1997, CitySearch issued and sold an
aggregate of 4,430,313 shares of Series D Preferred Stock (or 4,297,824
shares of Class A Common Stock pursuant to the Conversion and the
Reclassification) for an aggregate cash consideration of approximately
$28.9 million and for services provided to CitySearch. Such shares were
issued to the following: GS Capital Partners II, L.P.; GS Capital Partners
II Offshore, L.P.; Goldman, Sachs & Co. Verwaltungs GmbH; Stone Street Fund
1996, L.P.; Bridge Street Fund 1996, L.P.; Edwin C. Cohen; EnCompass Group,
Inc.; Michael Barton; Mark Lewyn; Brian A. Goler; Emily Bloomfield; Bradley
Ramberg; Lamar Rutherford; Kristen Brown; James R. McGovern; AnneMarie
Weibel; Debra J. Wilkens; Francesca Colloredo-Mansfeld; Kathryn Takach;
Byters; Comcast CitySearch, Inc.; Far West Capital Partners, L.P.; Robert
McLean; Morris Ventures; Steven Spielberg; David White; CPQ Holdings, Inc.;
Intel Corporation; Bayview Investors, Ltd.; Toronto Star Newspapers
Limited; AT&T Venture Fund I, L.P.; AT&T Venture Fund II, L.P.; Bill Gross'
idealab!; Alexander Communications, Inc.; The Times Mirror Company; Paul S.
Larsen; ServiceMaster Venture Fund L.L.C.; Digital Ink Company and
Korn/Ferry International.

(9) In June 1997, CitySearch issued an aggregate of 68,274 shares of
Series B Preferred Stock (or 68,274 shares of Class A Common Stock pursuant
to the Reclassification) at $6.5251 per share as additional consideration
for the acquisition of Metro Beat. Such shares were issued to the following
shareholders of MetroBeat: Mark Davies and Joshua White.

II-2
<PAGE>

(10) In November 1997, CitySearch issued and sold an aggregate of
4,714,286 shares of Series E Preferred Stock (or 4,655,347 shares of Class
A Common Stock pursuant to the Conversion and the Reclassification) for an
aggregate cash consideration of approximately $33.0 million. Such shares
were issued to the following: USAi; Comcast CitySearch, Inc.; Far West
Capital Partners, LP; Intel Corporation; Endurance Fund; Gary Lauder; The
Thomas and Janet Unterman Living Trust dated 12/30/94; East Peak Partners;
Margaret L. Taylor; David A. Duffield Trust dated 7/14/88; Orchid & Co.;
Digital Ink Company; Global Retail Partners, L.P.; DLJ Diversified
Partners, L.P.; GRP Partners, L.P.; Global Retail Partners Funding, Inc.;
DLJ First ESC L.P. and Schibsted ASA. NationsBanc Montgomery Securities LLC
acted as placement agent. As consideration for such services, CitySearch
paid NationsBanc $1,546,182 in cash and issued a warrant to purchase shares
of Series E Preferred Stock which terms and conditions are described in
item (11) below.

(11) In November 1997, as part consideration for services provided as
placement agent, CitySearch issued to NationsBanc a warrant to purchase
94,286 shares of Series E Preferred Stock (or 93,107 shares of Class A
Common Stock pursuant to the Conversion and the Reclassification). The
warrant is exercisable at any time at an exercise price equal to $8.86 per
share of Class A Common Stock and any unexercised portion of the warrant is
automatically convertible immediately prior to the closing of this
offering.

(12) In May 1998, CitySearch issued an sold an aggregate of 1,000,000
shares of its Series E Preferred Stock (or 987,500 shares of Class A Common
Stock pursuant to the Conversion and the Reclassification) for an aggregate
cash consideration of approximately $7.0 million. Such shares were issued
to the following: USAi and American Express.

(13) In June 1998, CitySearch issued an aggregate of 63,644 shares of
Series B Preferred Stock (or 63,644 shares of Class A Common Stock pursuant
to the Reclassification) at $7.00 per share as additional consideration for
the acquisition of MetroBeat. Such shares were issued to the following
shareholders of MetroBeat: Mark Davies and Joshua White.

(14) In September 1998, CitySearch issued an aggregate of 37,238,000
shares of CitySearch Common Stock (or 37,238,000 of Class A Common Stock
pursuant to the Reclassification) as consideration for the acquisition of
Ticketmaster Multimedia Holdings, Inc. Such shares were issued to
Ticketmaster Corp.

(15) In September 1998, pursuant to the Reclassification, each issued and
outstanding share of CitySearch Common Stock, or 62,486,478 shares, was
reclassified into one share of Class A Common Stock of the Company for no
consideration.

The sales of the securities described in Items 15(1) and 15(2) were deemed
to be exempt from registration under the Securities Act in reliance on Rule
701 promulgated under Section 3(b) of the Securities Act as transactions
pursuant to compensatory benefit plans and contracts relating to compensation
as provided under such Rule 701. The sale of the securities described in Items
15(3) through 15(14) were deemed to be exempt from registration under the
Securities Act in reliance on Section 4(2) of the Securities Act, or
Regulation D promulgated thereunder, as transactions by an issuer not
involving a public offering. The recipients of securities in each such
transaction represented their intention to acquire the securities for
investment only and not with a view to or for sale in connection with any
distribution thereof and appropriate legends were affixed to the share
certificates and other instruments issued in such transactions. All recipients
either received adequate information about CitySearch or had access, through
employment or other relationships, to such information. The sale of securities
in Item 15(15) was deemed to be exempt from registration under the Securities
Act in reliance on Section 3(a)(9) of the Securities Act as an exchange by the
issuer with its existing security holders where no commission or other
remuneration is paid or given directly or indirectly for soliciting such
exchange.

II-3
<PAGE>

ITEM 16. EXHIBITS

(a) Exhibits

<TABLE>
<C> <S>
1.1 Form of Underwriting Agreement.
2.1 *+Agreement and Plan of Reorganization, among CitySearch, Inc., MB
Acquisition Corporation, MetroBeat, Inc., Mark Davies and Joshua White,
dated May 31, 1996.
2.2 *Amended and Restated Agreement and Plan of Reorganization, among
CitySearch, Inc., Tiberius, Inc., USA Networks, Inc., Ticketmaster
Group, Inc., Ticketmaster Corporation and Ticketmaster Multimedia
Holdings, Inc., dated August 12, 1998.
3.1 *Amended and Restated Certificate of Incorporation, as currently in
effect.
3.2 Form of Amended and Restated Certificate of Incorporation, to be
effective immediately prior to the consummation of the offering.
3.3 Amended and Restated Bylaws.
4.1 Specimen Class B Common Stock Certificate.
5.1 Opinion of Wilson Sonsini Goodrich & Rosati, Professional Corporation,
as to the legality of the securities being registered.
10.1 ***Form of Indemnification Agreement for directors and officers.
10.2 1996 Stock Option Plan and form of agreement thereunder.
10.3 1998 Stock Option Plan and form of agreement thereunder.
10.4 **1998 Employee Stock Purchase Plan.
10.5 *+License Agreement between CitySearch, Inc. and Perly, Inc., dated
March 9, 1996.
10.6 *+Marketing Agreement between CitySearch, Inc. and American Express
Travel Related Services Company, Inc., dated May 26, 1998.
10.7 *Employment Agreement between CitySearch, Inc. and Charles Conn, dated
May 9, 1996.
10.8 *+Unanimous Shareholder Agreement between Tele-Direct (Services), Inc.,
Metroland Printing, Publishing & Distributing Ltd., CitySearch Canada,
Inc. and 1310818 Ontario, Inc., dated August 31, 1998.
10.9 *+Limited Partnership Agreement between Metroland Printing, Publishing &
Distributing Ltd., 1310818 Ontario Inc., CitySearch Canada, Inc., Tele-
Direct (Services), Inc., Tele-Direct (Publications), Inc., CitySearch,
Inc. and Torstar Corporation, dated August 31, 1998.
10.10 *+Amended and Restated License and Services Agreement between
CitySearch, Inc. and CitySearch Canada, Inc., dated August 31, 1998.
10.11 *+Sublicense and Services Agreement between CitySearch Canada, Inc. and
toronto.com, dated August 31, 1998.
10.12 *+Non-competition Agreement between Toronto Star Newspapers Ltd., Tele-
Direct (Services), Inc., CitySearch Canada, Inc. and Metroland Printing,
Publishing & Distributing Ltd., dated August 31, 1998.
10.13 *Lease Agreement by and between CitySearch, Inc. and West End Land
Development Co., L.P., dated November 7, 1996.
10.14 *Standard Form of Lease, Aeriel Center Executive Park, between
Pizzagalli Investment Company and CitySearch, Inc., dated May 8, 1996.
10.15 *Standard Office Lease between CitySearch, Inc. and Sage Realty
Corporation, dated May 6, 1997.
10.16 *Standard Office Lease between CitySearch, Inc. and H. Naito
Corporation, dated March 6, 1997.
10.17 *Standard Office Lease between CitySearch, Inc. and Brazos Austin
Centre, Ltd., dated August 15, 1996.
10.18 *Standard Office Lease between CitySearch, Inc. and Judge Building
Group, dated September 10, 1996.
10.19 *Standard Office Lease between CitySearch, Inc. and Sobel Building
Development, dated May 31, 1996.
10.20 *Standard Office Lease between CitySearch, Inc. and BPG Pasadena, L.L.C.
(later assigned to Spieker Properties), dated September 30, 1996.
10.21 *Lease Agreement between CitySearch, Inc. and Secured Properties
Investors II, L.P., dated May 13, 1998.
10.22 *Employment Agreement between CitySearch, Inc. and Thomas Layton, dated
July 2, 1997.
</TABLE>

II-4
<PAGE>

<TABLE>
<C> <S>
10.23 *+License and Services Agreement between CitySearch, Inc. and Classified
Ventures, L.L.C.
10.24 *Convertible Promissory Note issued to CitySearch, Inc. by USA Networks,
Inc., dated August 12, 1998.
10.25 *Non-Competition Agreement between CitySearch, Inc., Ticketmaster
Corporation, Ticketmaster
Multimedia Holdings, Inc., and Charles Conn, dated August 12, 1998.
10.26 *Non-Competition Agreement between CitySearch, Inc., Ticketmaster
Corporation, Ticketmaster
Multimedia Holdings, Inc., and Thomas Layton, dated August 12, 1998.
10.27 *+Letter Agreement between N2K Inc. and Ticketmaster Ticketing Co.,
Inc., dated April 23, 1998, as
amended by a Letter Agreement by and between the parties, dated June 16,
1998.
10.28 *Development and Services Agreement between Ticketmaster Multimedia
Holdings, Inc. and Starwave
Corporation, dated June 28, 1996.
10.29 *+License and Services Agreement between Ticketmaster Corporation,
Ticketmaster Multimedia
Holdings, Inc. and USA Networks, Inc., dated August 12, 1998.
21.1 *Subsidiaries of the Registrant.
23.1 Consent of Independent Auditors.
23.2 Consent of Independent Auditors.
23.3 Consent of Counsel (included in Exhibit 5.1).
24.1 *Power of Attorney.
27.1 *Financial Data Schedule.
</TABLE>

(b) Schedules
Schedule II--Valuation and Qualifying Accounts
- --------
* Previously filed.

** To be filed by amendment.

*** Previously filed form will not be used by the Company.
+ Confidential treatment requested.

ITEM 17. UNDERTAKINGS

The Registrant hereby undertakes to provide the Underwriters at the closing
specified in the Underwriting Agreement certificates in such denominations and
registered in such names as required by the Underwriters to permit prompt
delivery to each purchaser.

Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers, and controlling persons of the
Registrant pursuant to the provisions described in Item 14 above, or
otherwise, the Registrant has been advised that in the opinion of the
Commission such indemnification is against public policy as expressed in the
Securities Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
Registrant of expenses incurred or paid by a director, officer, or controlling
person of the Registrant in the successful defense of any action, suit, or
proceeding) is asserted by such director, officer, or controlling person in
connection with the securities being registered, the Registrant will, unless
in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the
Securities Act, and will be governed by the final adjudication of such issue.

The undersigned Registrant undertakes that: (1) for purposes of determining
any liability under the Securities Act, the information omitted from the form
of prospectus as filed as part of the registration statement in reliance upon
Rule 430A and contained in the form of prospectus filed by the Registrant
pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act shall be
deemed to be part of this registration statement as of the time it was
declared effective, and (2) for the purpose of determining any liability under
the Securities Act, each post-effective amendment that contains a form of
prospectus shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.

II-5
<PAGE>

SIGNATURES

PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, AS AMENDED, THE
REGISTRANT HAS DULY CAUSED THIS AMENDMENT TO THE REGISTRATION STATEMENT ON
FORM S-1 TO BE SIGNED ON ITS BEHALF BY THE UNDERSIGNED, THEREUNTO DULY
AUTHORIZED, IN THE CITY OF PASADENA, STATE OF CALIFORNIA, ON THE 6TH DAY OF
NOVEMBER, 1998.

TICKETMASTER ONLINE-CITYSEARCH, INC.

/s/ Charles Conn
By: _________________________________
CHARLES CONN
CHIEF EXECUTIVE OFFICER

PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, AS AMENDED, THIS
AMENDMENT TO THE REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING
PERSONS IN THE CAPACITIES AND ON THE DATES INDICATED.

<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----

<S> <C> <C>
/s/ Charles Conn Chief Executive Officer November 6, 1998
____________________________________ (Principal Executive
CHARLES CONN Officer)

/s/ Bradley Ramberg Chief Financial Officer and November 6, 1998
____________________________________ Vice President, Finance and
BRADLEY RAMBERG Administration and
Secretary (Principal
Financial Officer and
Principal Accounting
Officer)

* Director November 6, 1998
____________________________________
TERRY BARNES

* Director November 6, 1998
____________________________________
ALAN CITRON

* Director November 6, 1998
____________________________________
EUGENE L. COBUZZI
* Director November 6, 1998
____________________________________
STUART W. DEPINA

* Director November 6, 1998
____________________________________
BARRY DILLER

* Director November 6, 1998
____________________________________
JOSEPH GLEBERMAN

</TABLE>

II-6
<PAGE>

<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<S> <C> <C>
* Director November 6, 1998
____________________________________
WILLIAM GROSS

* Director November 6, 1998
____________________________________
VICTOR A. KAUFMAN

* Director November 6, 1998
____________________________________
ROBERT KAVNER
* Director November 6, 1998
____________________________________
WILLIAM D. SAVOY

* Director November 6, 1998
____________________________________
ALAN SPOON

* Director November 6, 1998
____________________________________
THOMAS UNTERMAN
</TABLE>

/s/ Bradley Ramberg
*By: __________________________
BRADLEY RAMBERG
ATTORNEY-IN-FACT

II-7
<PAGE>

CITYSEARCH, INC.
SCHEDULE II VALUATION AND QUALIFYING ACCOUNTS

<TABLE>
<CAPTION>
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E
-------- ---------- --------------------- ---------- ----------
BALANCE AT CHARGED TO CHARGED TO BALANCE AT
BEGINNING COSTS AND OTHER THE END OF
DESCRIPTION OF PERIOD EXPENSES ACCOUNTS DEDUCTIONS PERIOD
----------- ---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Period from September 20
(date of formation)
through December 31,
1995................... $-- $ -- $-- $ -- $ --
Year ended December 31,
1996................... -- -- -- -- --
Year ended December 31,
1997................... -- 114,000 -- 89,000(a) 25,000
</TABLE>
- --------
(a) Represents amounts written-off against the allowance for doubtful accounts,
net of recoveries and reversals.
<PAGE>

EXHIBIT INDEX

<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION
----------- -----------
<C> <S>
1.1 Form of Underwriting Agreement.
2.1 *+Agreement and Plan of Reorganization, among CitySearch, Inc., MB
Acquisition Corporation, MetroBeat, Inc., Mark Davies and Joshua
White, dated May 31, 1996.
2.2 *Amended and Restated Agreement and Plan of Reorganization, among
CitySearch, Inc., Tiberius, Inc., USA Networks, Inc., Ticketmaster
Group, Inc., Ticketmaster Corporation and Ticketmaster Multimedia
Holdings, Inc., dated August 12, 1998.
3.1 *Amended and Restated Certificate of Incorporation, as currently
in effect.
3.2 Form of Amended and Restated Certificate of Incorporation, to be
effective immediately prior to the consummation of the offering.
3.3 Amended and Restated Bylaws.
4.1 Specimen Class B Common Stock Certificate.
5.1 Opinion of Wilson Sonsini Goodrich & Rosati, Professional
Corporation, as to the legality of the securities being
registered.
10.1 ***Form of Indemnification Agreement for directors and officers.
10.2 1996 Stock Option Plan and form of agreement thereunder.
10.3 1998 Stock Option Plan and form of agreement thereunder.
10.4 **1998 Employee Stock Purchase Plan.
10.5 *+License Agreement between CitySearch, Inc. and Perly, Inc.,
dated March 9, 1996.
10.6 *+Marketing Agreement between CitySearch, Inc. and American
Express Travel Related Services Company, Inc., dated May 26, 1998.
10.7 *Employment Agreement between CitySearch, Inc. and Charles Conn,
dated May 9, 1996.
10.8 *+Unanimous Shareholder Agreement between Tele-Direct (Services),
Inc., Metroland Printing, Publishing & Distributing Ltd.,
CitySearch Canada, Inc. and 1310818 Ontario, Inc., dated August
31, 1998.
10.9 *+Limited Partnership Agreement between Metroland Printing,
Publishing & Distributing Ltd., 1310818 Ontario Inc., CitySearch
Canada, Inc., Tele-Direct (Services), Inc., Tele-Direct
(Publications), Inc., CitySearch, Inc. and Torstar Corporation,
dated August 31, 1998.
10.10 *+Amended and Restated License and Services Agreement between
CitySearch, Inc. and CitySearch Canada, Inc., dated August 31,
1998.
10.11 *+Sublicense and Services Agreement between CitySearch Canada,
Inc. and toronto.com, dated August 31, 1998.
10.12 *+Non-competition Agreement between Toronto Star Newspapers Ltd.,
Tele-Direct (Services), Inc., CitySearch Canada, Inc. and
Metroland Printing, Publishing & Distributing Ltd., dated August
31, 1998.
10.13 *Lease Agreement by and between CitySearch, Inc. and West End Land
Development Co., L.P., dated November 7, 1996.
10.14 *Standard Form of Lease, Aeriel Center Executive Park, between
Pizzagalli Investment Company and CitySearch, Inc., dated May 8,
1996.
10.15 *Standard Office Lease between CitySearch, Inc. and Sage Realty
Corporation, dated May 6, 1997.
10.16 *Standard Office Lease between CitySearch, Inc. and H. Naito
Corporation, dated March 6, 1997.
10.17 *Standard Office Lease between CitySearch, Inc. and Brazos Austin
Centre, Ltd., dated August 15, 1996.
10.18 *Standard Office Lease between CitySearch, Inc. and Judge Building
Group, dated September 10, 1996.
10.19 *Standard Office Lease between CitySearch, Inc. and Sobel Building
Development, dated May 31, 1996.
10.20 *Standard Office Lease between CitySearch, Inc. and BPG Pasadena,
L.L.C. (later assigned to Spieker Properties), dated September 30,
1996.
</TABLE>
<PAGE>

<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION
----------- -----------
<C> <S>
10.21 *Lease Agreement between CitySearch, Inc. and Secured Properties
Investors II, L.P., dated May 13, 1998.
10.22 *Employment Agreement between CitySearch, Inc. and Thomas Layton,
dated July 2, 1997.
10.23 *+License and Services Agreement between CitySearch, Inc. and
Classified Ventures, L.L.C.
10.24 *Convertible Promissory Note issued to CitySearch, Inc. by USA
Networks, Inc., dated August 12, 1998.
10.25 *Non-Competition Agreement between CitySearch, Inc., Ticketmaster
Corporation, Ticketmaster Multimedia Holdings, Inc., and Charles
Conn, dated August 12, 1998.
10.26 *Non-Competition Agreement between CitySearch, Inc., Ticketmaster
Corporation, Ticketmaster Multimedia Holdings, Inc., and Thomas
Layton, dated August 12, 1998.
10.27 *+Letter Agreement between N2K Inc. and Ticketmaster Ticketing
Co., Inc., dated April 23, 1998, as amended by a Letter Agreement
by and between the parties, dated June 16, 1998.
10.28 *Development and Services Agreement between Ticketmaster
Multimedia Holdings, Inc. and Starwave Corporation, dated June 28,
1996.
10.29 *+License and Services Agreement between Ticketmaster Corporation,
Ticketmaster Multimedia Holdings, Inc. and USA Networks, Inc.,
dated August 12, 1998.
21.1 *Subsidiaries of the Registrant.
23.1 Consent of Independent Auditors.
23.2 Consent of Independent Auditors.
23.3 Consent of Counsel (included in Exhibit 5.1).
24.1 *Power of Attorney.
27.1 *Financial Data Schedule.
</TABLE>
- --------
* Previously filed.

** To be filed by amendment.

*** Form previously filed will not be used by the Company.
+ Confidential treatment requested.

<PAGE>

DRAFT
-----

____________ SHARES

CITYSEARCH, INC.

COMMON STOCK

UNDERWRITING AGREEMENT

DATED NOVEMBER __, 1998
<PAGE>

TABLE OF CONTENTS

<TABLE>
<S> <C>
SECTION 1. REPRESENTATIONS AND WARRANTIES......................................................... 2
COMPLIANCE WITH REGISTRATION REQUIREMENTS.............................................. 2
OFFERING MATERIALS FURNISHED TO UNDERWRITERS........................................... 3
DISTRIBUTION OF OFFERING MATERIAL BY THE COMPANY....................................... 3
THE UNDERWRITING AGREEMENT............................................................. 3
AUTHORIZATION OF THE CLASS B COMMON SHARES............................................. 3
NO APPLICABLE REGISTRATION OR OTHER SIMILAR RIGHTS..................................... 3
NO MATERIAL ADVERSE CHANGE............................................................. 3
INDEPENDENT ACCOUNTANTS................................................................ 4
PREPARATION OF THE FINANCIAL STATEMENTS................................................ 4
INCORPORATION AND GOOD STANDING OF THE COMPANY
AND ITS SUBSIDIARIES.................................................................. 4
CAPITALIZATION AND OTHER CAPITAL STOCK MATTERS......................................... 5
STOCK EXCHANGE LISTING;................................................................ 5
NON-CONTRAVENTION OF EXISTING INSTRUMENTS; NO
FURTHER AUTHORIZATIONS OR APPROVALS REQUIRED.......................................... 5
NO MATERIAL ACTIONS OR PROCEEDINGS..................................................... 6
INTELLECTUAL PROPERTY RIGHTS........................................................... 6
ALL NECESSARY PERMITS, ETC............................................................. 6
TITLE TO PROPERTIES.................................................................... 6
TAX LAW COMPLIANCE..................................................................... 7
COMPANY NOT AN INVESTMENT COMPANY...................................................... 7
INSURANCE.............................................................................. 7
NO PRICE STABILIZATION OR MANIPULATION................................................. 7
RELATED PARTY TRANSACTIONS............................................................. 7
NO UNLAWFUL CONTRIBUTIONS OR OTHER PAYMENTS............................................ 8
COMPANY'S ACCOUNTING SYSTEM............................................................ 8
COMPLIANCE WITH ENVIRONMENTAL LAWS..................................................... 8
ERISA COMPLIANCE....................................................................... 9
MERGER AGREEMENT....................................................................... 9
YEAR 2000 COMPLIANCE................................................................... 9
SECTION 2. PURCHASE, SALE AND DELIVERY OF CLASS B COMMON SHARES................................... 10
THE FIRM CLASS B COMMON SHARES......................................................... 10
THE FIRST CLOSING DATE................................................................. 10
THE OPTIONAL CLASS B COMMON SHARES; THE SECOND CLOSING DATE............................ 11
PUBLIC OFFERING OF THE CLASS B COMMON SHARES........................................... 11
PAYMENT FOR THE CLASS B COMMON SHARES.................................................. 11
DELIVERY OF THE CLASS B COMMON SHARES.................................................. 12
DELIVERY OF PROSPECTUS TO THE UNDERWRITERS............................................. 12
SECTION 3. ADDITIONAL COVENANTS................................................................... 12
</TABLE>

-i-
<PAGE>

<TABLE>
<S> <C>
REPRESENTATIVE'S REVIEW OF PROPOSED AMENDMENTS AND SUPPLEMENTS.......................... 12
SECURITIES ACT COMPLIANCE............................................................... 12
AMENDMENTS AND SUPPLEMENTS TO THE PROSPECTUS AND OTHER SECURITIES ACT MATTERS........... 13
COPIES OF ANY AMENDMENTS AND SUPPLEMENTS TO THE PROSPECTUS.............................. 13
BLUE SKY COMPLIANCE..................................................................... 13
USE OF PROCEEDS......................................................................... 13
TRANSFER AGENT.......................................................................... 13
EARNINGS STATEMENT...................................................................... 13
PERIODIC REPORTING OBLIGATIONS.......................................................... 14
AGREEMENT NOT TO OFFER OR SELL ADDITIONAL SECURITIES.................................... 14
FUTURE REPORTS TO THE REPRESENTATIVE.................................................... 14
SECTION 4. PAYMENT OF EXPENSES..................................................................... 14
SECTION 5. CONDITIONS OF THE OBLIGATIONS OF THE UNDERWRITERS....................................... 15
ACCOUNTANTS' COMFORT LETTER............................................................. 15
COMPLIANCE WITH REGISTRATION REQUIREMENTS; NO STOP ORDER, NO OBJECTION FROM NASD........ 15
NO MATERIAL ADVERSE CHANGE OR RATINGS AGENCY CHANGE..................................... 16
OPINION OF COUNSEL FOR THE COMPANY...................................................... 16
OPINION OF COUNSEL FOR THE UNDERWRITERS................................................. 16
OFFICERS' CERTIFICATE................................................................... 17
BRING-DOWN COMFORT LETTER............................................................... 17
LOCK-UP AGREEMENT FROM CERTAIN STOCKHOLDERS OF THE COMPANY.............................. 17
ADDITIONAL DOCUMENTS.................................................................... 17
SECTION 6. REIMBURSEMENT OF UNDERWRITERS' EXPENSES................................................. 18
SECTION 7. EFFECTIVENESS OF THIS AGREEMENT......................................................... 18
SECTION 8. INDEMNIFICATION......................................................................... 18
INDEMNIFICATION OF THE UNDERWRITERS..................................................... 18
INDEMNIFICATION OF THE COMPANY, ITS DIRECTORS AND OFFICERS.............................. 19
NOTIFICATIONS AND OTHER INDEMNIFICATION PROCEDURES...................................... 20
SETTLEMENTS............................................................................. 21
SECTION 9. CONTRIBUTION............................................................................ 21
SECTION 10. DEFAULT OF ONE OR MORE OF THE SEVERAL UNDERWRITERS...................................... 23
SECTION 11. TERMINATION OF THIS AGREEMENT........................................................... 23
SECTION 12. REPRESENTATIONS AND INDEMNITIES TO SURVIVE DELIVERY..................................... 24
</TABLE>

-ii-
<PAGE>

<TABLE>
<S> <C>
SECTION 13. NOTICES........................................................................ 24
SECTION 14. SUCCESSORS..................................................................... 25
SECTION 15. PARTIAL UNENFORCEABILITY....................................................... 25
SECTION 16. GOVERNING LAW PROVISIONS....................................................... 25
SECTION 17. GENERAL PROVISIONS............................................................. 26
</TABLE>

-iii-
<PAGE>

DRAFT
-----

UNDERWRITING AGREEMENT

November __, 1998

NATIONSBANC MONTGOMERY SECURITIES LLC
ALLEN & COMPANY INCORPORATED
BANCAMERICA ROBERTSON STEPHENS
BEAR, STEARNS & CO. INC.
DONALDSON, LUFKIN & JENRETTE SECURITIES CORPORATION
As Representatives of the several Underwriters
c/o NATIONSBANC MONTGOMERY SECURITIES LLC
600 Montgomery Street
San Francisco, California 94111

Ladies and Gentlemen:

INTRODUCTORY. Ticketmaster Online-CitySearch, Inc., a Delaware corporation
(the "Company"), proposes to issue and sell to the several underwriters named in
Schedule A (the "Underwriters") an aggregate of _________ shares (the "Firm
- ----------
Class B Common Shares") of its Class B Common Stock, par value $0.01 per share
(the "Class B Common Stock"). In addition, the Company has granted to the
Underwriters an option to purchase up to an additional ________ shares (the
"Optional Class B Common Shares") of Class B Common Stock, as provided in
Section 2. The Firm Class B Common Shares and, if and to the extent such option
is exercised, the Optional Class B Common Shares are collectively called the
"Class B Common Shares". Nationsbanc Montgomery Securities LLC ("NMS"), Allen &
Company Incorporated ("ACI"), BancAmerica Robertson Stephens ("BRS"), Bear,
Stearns & Co. Inc. ("BSC") and Donaldson, Lufkin & Jenrette Securities
Corporation ("DLJ") have agreed to act as representatives of the several
Underwriters (in such capacity, the "Representatives") in connection with the
offering and sale of the Class B Common Shares.

The Company has prepared and filed with the Securities and Exchange
Commission (the "Commission") a registration statement on Form S-1 (File No.
333-____), which contains a form of prospectus to be used in connection with the
public offering and sale of the Common Shares. Such registration statement, as
amended, including the financial statements, exhibits and schedules thereto, in
the form in which it was declared effective by the Commission under the
Securities Act of 1933, as amended, and the rules and regulations promulgated
thereunder (collectively, the "Securities Act"), including any information
deemed to be a part thereof at the time of effectiveness pursuant to Rule 430A
or Rule 434 under the Securities Act, is called the "Registration Statement."
Any registration statement filed by the Company pursuant to Rule 462(b) under
the Securities Act is called the "Rule 462(b) Registration Statement," and from
and after the date and time of filing of the Rule 462(b) Registration Statement
the term "Registration Statement" shall include the Rule 462(b) Registration
Statement. Such prospectus, in the form first used by the Underwriters to
confirm sales of the Class B Common

-1-
<PAGE>

Shares, is called the "Prospectus;" provided, however, if the Company has, with
the consent of the Representatives, elected to rely upon Rule 434 under the
Securities Act, the term "Prospectus" shall mean the Company's prospectus
subject to completion (each, a "preliminary prospectus") dated October ___, 1998
(such preliminary prospectus is called the "Rule 434 preliminary prospectus"),
together with the applicable term sheet (the "Term Sheet") prepared and filed by
the Company with the Commission under Rules 434 and 424(b) under the Securities
Act and all references in this Agreement to the date of the Prospectus shall
mean the date of the Term Sheet. All references in this Agreement to the
Registration Statement, the Rule 462(b) Registration Statement, a preliminary
prospectus, the Prospectus or the Term Sheet, or any amendments or supplements
to any of the foregoing, shall include any copy thereof filed with the
Commission pursuant to its Electronic Data Gathering, Analysis and Retrieval
System ("EDGAR").

The Company hereby confirms its agreements with the Underwriters as
follows:

SECTION 1. REPRESENTATIONS AND WARRANTIES.

The Company hereby represents, warrants and covenants to each Underwriter
as follows:

(a) Compliance with Registration Requirements. The Registration
Statement and any Rule 462(b) Registration Statement have been declared
effective by the Commission under the Securities Act. The Company has
complied to the Commission's satisfaction with all requests of the Commission
for additional or supplemental information. No stop order suspending the
effectiveness of the Registration Statement or any Rule 462(b) Registration
Statement is in effect and no proceedings for such purpose have been
instituted or are pending or, to the best knowledge of the Company, are
contemplated or threatened by the Commission.

Each preliminary prospectus and the Prospectus when filed complied in all
material respects with the Securities Act and, if filed by electronic
transmission pursuant to EDGAR (except as may be permitted by Regulation S-T
under the Securities Act), was identical to the copy thereof delivered to the
Underwriters for use in connection with the offer and sale of the Class B
Common Shares. Each of the Registration Statement, any Rule 462(b)
Registration Statement and any post-effective amendment thereto, at the time
it became effective and at all subsequent times, complied and will comply in
all material respects with the Securities Act and did not and will not contain
any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading. The Prospectus, as amended or supplemented, as of its date and at
all subsequent times, did not and will not contain any untrue statement of a
material fact or omit to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading. The representations and warranties set forth in the two
immediately preceding sentences do not apply to statements in or omissions
from the Registration Statement, any Rule 462(b) Registration Statement, or
any post-effective amendment thereto, or the Prospectus, or any amendments or
supplements thereto, made in reliance upon and in conformity with information
relating to any Underwriter furnished to the Company in writing by the
Representatives expressly for use therein. There are no contracts or other
documents required to be described in the Prospectus or to be filed as
exhibits to the Registration Statement which have not been described or filed
as required.

-2-
<PAGE>

(b) Offering Materials Furnished to Underwriters. The Company has
delivered to the Representatives three complete manually signed copies of the
Registration Statement and of each consent and certificate of experts filed as
a part thereof, and conformed copies of the Registration Statement (without
exhibits) and preliminary prospectuses and the Prospectus, as amended or
supplemented, in such quantities and at such places as the Representatives
have reasonably requested for each of the Underwriters.

(c) Distribution of Offering Material By the Company. The Company has
not distributed and will not distribute, prior to the later of the Second
Closing Date (as defined below) and the completion of the Underwriters'
distribution of the Class B Common Shares, any offering material in connection
with the offering and sale of the Class B Common Shares other than a
preliminary prospectus, the Prospectus or the Registration Statement.

(d) The Underwriting Agreement. This Agreement has been duly
authorized, executed and delivered by, and is a valid and binding agreement
of, the Company, enforceable in accordance with its terms, except as rights to
indemnification hereunder may be limited by applicable law and except as the
enforcement hereof may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws relating to or affecting the rights and
remedies of creditors or by general equitable principles.

(e) Authorization of the Class B Common Shares. The Class B Common
Shares to be purchased by the Underwriters from the Company have been duly
authorized for issuance and sale pursuant to this Agreement and, when issued
and delivered by the Company pursuant to this Agreement, will be validly
issued, fully paid and nonassessable and issued in compliance with all
applicable federal and state securities laws.

(f) No Applicable Registration or Other Similar Rights. There are no
persons with registration or other similar rights to have any equity or debt
securities registered for sale under the Registration Statement or included in
the offering contemplated by this Agreement, except for such rights as have
been duly waived or relinquished in accordance with their terms.

(g) No Material Adverse Change. Except as otherwise disclosed in the
Prospectus, subsequent to the respective dates as of which information is
given in the Prospectus: (i) there has been no material adverse change, or
any development that could reasonably be expected to result in a material
adverse change, in the condition, financial or otherwise, or in the earnings,
business, operations or prospects, whether or not arising from transactions in
the ordinary course of business, of the Company and its subsidiaries,
considered as one entity, or of Ticketmaster Multimedia Holdings, Inc.
("TMOL") (any such change is called a "Material Adverse Change"); (ii) neither
the Company and its subsidiaries, considered as one entity, nor TMOL have
incurred any material liability or obligation, indirect, direct or contingent,
not in the ordinary course of business nor entered into any material
transaction or agreement not in the ordinary course of business; and (iii)
there has been no dividend or distribution of any kind declared, paid or made
by the Company or, except for dividends paid to the Company or other
subsidiaries, any of its subsidiaries on any class of capital stock or
repurchase or redemption by the Company or any of its subsidiaries of any
class of capital stock.

-3-
<PAGE>

(h) Independent Accountants. Ernst & Young LLP, which has expressed its
opinion with respect to the financial statements (which term as used in this
Agreement includes the related notes thereto) and supporting schedules filed
with the Commission as a part of the Registration Statement and included in
the Prospectus, are independent certified public accountants as required by
the Securities Act.

(i) Preparation of the Financial Statements. The historical financial
statements filed with the Commission as a part of the Registration Statement
and included in the Prospectus present fairly the consolidated financial
position of CitySearch, Inc. and its subsidiaries ("CitySearch") (the
"CitySearch Financial Statements") as of and at the dates indicated and the
results of their operations and cash flows for the periods specified. The
historical financial statements of TMOL (the "TMOL Financial Statements")
filed with the Commission as a part of the Registration Statement and included
in the Prospectus present fairly (i) the financial position of TMOL prior to
consummation of the Merger Agreement (as defined below) as of and at the dates
indicated and the results of its operations and cash flows for the periods
specified and (ii) the financial position of TMOL and CitySearch on a
consolidated basis following consummation of the Merger Agreement as of and at
the dates indicated and the results of operations and cash flows for the
periods specified. The condensed combined pro forma financial statements (the
"Pro Forma Financial Statements") of TMOL and CitySearch fairly present the
combined pro forma financial position of CitySearch and TMOL on and at the
dates indicated and the combined pro forma results of their operations and
cash flows for the periods specified. The supporting schedules included in
the Registration Statement present fairly the information required to be
stated therein. The CitySearch Financial Statements, the TMOL Financial
Statements and the Pro Forma Financial Statements, and supporting schedules
included in the Registration Statement present fairly the information required
to be stated therein. Such financial statements and supporting schedules have
been prepared in conformity with United States generally accepted accounting
principles applied on a consistent basis throughout the periods involved,
except as may be expressly stated in the related notes thereto. No other
financial statements or supporting schedules are required to be included in
the Registration Statement. The financial data set forth in the Prospectus
under the captions "Prospectus Summary--CitySearch Summary Historical
Financial Data", "Prospectus Summary--Ticketmaster Online Summary Historical
Financial Data," "Prospectus Summary--Summary Unaudited Pro Forma Combined
Financial Data," "Selected Historical Financial Data," "Selected Unaudited Pro
Forma Combined Financial Data" and "Capitalization" fairly present the
information set forth therein on a basis consistent with that of the audited
financial statements contained in the Registration Statement.

(j) Incorporation and Good Standing of the Company and its Subsidiaries.
Each of the Company and its subsidiaries has been duly incorporated and is
validly existing as a corporation in good standing under the laws of the
jurisdiction of its incorporation and has corporate power and authority to
own, lease and operate its properties and to conduct its business as described
in the Prospectus and, in the case of the Company, to enter into and perform
its obligations under this Agreement. Each of the Company and each subsidiary
is duly qualified as a foreign corporation to transact business and is in good
standing in the State of California and each other jurisdiction in which such
qualification is required, whether by reason of the ownership or leasing of
property or the conduct of business, except for such jurisdictions (other than
the State of California) where the failure to so qualify or to be in good
standing would not, individually or in the aggregate, result in a Material
Adverse

-4-
<PAGE>

Change. All of the issued and outstanding capital stock of each subsidiary has
been duly authorized and validly issued, is fully paid and nonassessable and
is owned by the Company, directly or through subsidiaries, free and clear of
any security interest, mortgage, pledge, lien, encumbrance or claim. The
Company does not own or control, directly or indirectly, any corporation,
association or other entity other than the subsidiaries listed in Exhibit 22.1
to the Registration Statement.

(k) Capitalization and Other Capital Stock Matters. The authorized,
issued and outstanding capital stock of the Company is as set forth in the
Prospectus under the caption "Capitalization" (other than for subsequent
issuances, if any, pursuant to employee benefit plans described in the
Prospectus or upon exercise of outstanding options or warrants described in
the Prospectus). The Class B Common Stock (including the Class B Common
Shares) and the Company's Class A Common Stock, par value $0.01 per share (the
"Class A Common Stock" and together with the Class B Common Stock, the "Common
Stock"), each conforms in all material respects to the description thereof
contained in the Prospectus. All of the issued and outstanding shares of
Common Stock have been duly authorized and validly issued, are fully paid and
nonassessable and have been issued in compliance with all applicable federal
and state securities laws. None of the outstanding shares of Common Stock
were issued in violation of any preemptive rights, rights of first refusal or
other similar rights to subscribe for or purchase securities of the Company.
There are no authorized or outstanding options, warrants, preemptive rights,
rights of first refusal or other rights to purchase, or equity or debt
securities convertible into or exchangeable or exercisable for, any capital
stock of the Company or any of its subsidiaries other than those accurately
described in the Prospectus. The description of the Company's stock option,
stock bonus and other stock plans or arrangements, and the options or other
rights granted thereunder, set forth in the Prospectus accurately and fairly
presents, in all material respects, the information required to be shown with
respect to such plans, arrangements, options and rights.

(l) Stock Exchange Listing. The Class B Common Shares have been
approved for inclusion on the Nasdaq National Market, subject only to official
notice of issuance.

(m) Non-Contravention of Existing Instruments; No Further Authorizations
or Approvals Required. Neither the Company nor any of its subsidiaries is in
violation of its charter or by-laws or is in default (or, with the giving of
notice or lapse of time, would be in default) ("Default") under any indenture,
mortgage, loan or credit agreement, note, contract, franchise, lease or other
instrument to which the Company or any of its subsidiaries is a party or by
which it or any of them may be bound or to which any of the property or assets
of the Company or any of its subsidiaries is subject (each, an "Existing
Instrument"), except for such Defaults as would not, individually or in the
aggregate, result in a Material Adverse Change. The Company's execution,
delivery and performance of this Agreement and consummation of the
transactions contemplated hereby and by the Prospectus (i) have been duly
authorized by all necessary corporate action and will not result in any
violation of the provisions of the charter or by-laws of the Company or any
subsidiary, (ii) will not conflict with or constitute a breach of, or Default
under, or result in the creation or imposition of any lien, charge or
encumbrance upon any property or assets of the Company or any of its
subsidiaries pursuant to, or require the consent of any other party to, any
Existing Instrument, except for such conflicts, breaches, Defaults, liens,
charges or encumbrances as would not, individually or in the aggregate, result
in a Material Adverse Change and (iii) will not result in any violation of any
law, administrative regulation or administrative or court

-5-
<PAGE>

decree applicable to the Company or any subsidiary, which violation would,
individually or in the aggregate, result in a Material Adverse Change. No
consent, approval, authorization or other order of, or registration or filing
with, any court or other governmental or regulatory authority or agency, is
required for the Company's execution, delivery and performance of this
Agreement and consummation of the transactions contemplated hereby and by the
Prospectus, except such as have been obtained or made by the Company and are
in full force and effect under the Securities Act, applicable state securities
or blue sky laws, and the rules and regulations promulgated by the National
Association of Securities Dealers, Inc. (the "NASD").

(n) No Material Actions or Proceedings. There are no legal or
governmental actions, suits or proceedings pending or, to the best of the
Company's knowledge, threatened (i) against or affecting the Company or any of
its subsidiaries, (ii) to the best of the Company's knowledge, against
Ticketmaster Corp. ("Ticketmaster") or any of its affiliates that could
reasonably be expected to affect the Company and its subsidiaries taken as a
whole, (iii) which has as the subject thereof any officer or director of, or
property owned or leased by, the Company or any of its subsidiaries or (iv)
relating to environmental or discrimination matters, where in any such case
(A) there is a reasonable possibility that such action, suit or proceeding
might be determined adversely to the Company or such subsidiary and (B) any
such action, suit or proceeding, if so determined adversely, would reasonably
be expected to result in a Material Adverse Change or adversely affect the
consummation of the transactions contemplated by this Agreement. No material
labor dispute with the employees of the Company or any of its subsidiaries
exists or, to the best of the Company's knowledge, is threatened or imminent.

(o) Intellectual Property Rights. The Company and its subsidiaries own
or possess sufficient trademarks, trade names, patent rights, copyrights,
licenses, approvals, trade secrets and other similar rights (collectively,
"Intellectual Property Rights") reasonably necessary to conduct their
businesses as now conducted; and the expected expiration of any of such
Intellectual Property Rights would not result in a Material Adverse Change.
Neither the Company nor any of its subsidiaries has received any notice of
infringement or conflict with asserted Intellectual Property Rights of others,
which infringement or conflict, if the subject of an unfavorable decision,
would result in a Material Adverse Change.

(p) All Necessary Permits, etc. The Company, each subsidiary of the
Company, and, to the best of the Company's knowledge, Ticketmaster each
possess such valid and current certificates, authorizations or permits
(collectively, "Permits") issued by the appropriate state, federal or foreign
regulatory agencies or bodies necessary to conduct their respective businesses
except where the failure to possess such Permit would not singly or in the
aggregate result in a Material Adverse Change, and neither the Company nor any
such subsidiary nor Ticketmaster has received any notice of proceedings
relating to the revocation or modification of, or non-compliance with, any
such Permit which, singly or in the aggregate, if the subject of an
unfavorable decision, ruling or finding, could result in a Material Adverse
Change.

(q) Title to Properties. The Company and each of its subsidiaries has
good and marketable title to all the properties and assets reflected as owned
in the financial statements referred to in Section 1(i) above (or elsewhere in
the Prospectus), in each case free and clear of any security interests,
mortgages, liens, encumbrances, equities, claims and other defects,

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<PAGE>

except such as do not materially and adversely affect the value of such
property and do not materially interfere with the use made or proposed to be
made of such property by the Company or such subsidiary. The real property,
improvements, equipment and personal property held under lease by the Company
or any subsidiary are held under valid and enforceable leases, with such
exceptions as are not material and do not materially interfere with the use
made or proposed to be made of such real property, improvements, equipment or
personal property by the Company or such subsidiary.

(r) Tax Law Compliance. The Company and its subsidiaries have filed all
necessary federal, state and foreign income and franchise tax returns other
than those being contested in good faith and have paid all material taxes
required to be paid by any of them and, if due and payable, any related or
similar material assessment, fine or penalty levied against any of them other
than those being contested in good faith and for which adequate reserves have
been provided, if required by United States generally accepted accounting
principles. The Company has made adequate charges, accruals and reserves (if
required by United States generally accepted accounting principles) in the
applicable financial statements referred to in Section 1 (i) above in respect
of all federal, state and foreign income and franchise taxes for all periods
as to which the tax liability of the Company or any of its subsidiaries has
not been finally determined.

(s) Company Not an "Investment Company". The Company has been advised
of the rules and requirements under the Investment Company Act of 1940, as
amended (the "Investment Company Act"). The Company is not, and after receipt
of payment for the Class B Common Shares will not be, an "investment company"
within the meaning of the Investment Company Act and will conduct its business
in a manner so that it will not become subject to the Investment Company Act.

(t) Insurance. Each of the Company and its subsidiaries are insured by
recognized, financially sound and reputable institutions with policies in such
amounts and with such deductibles and covering such risks as are generally
deemed adequate and customary for their businesses including, but not limited
to, policies covering real and personal property owned or leased by the
Company and its subsidiaries against theft, damage, destruction, acts of
vandalism and earthquakes. The Company has no reason to believe that it or
any subsidiary will not be able (i) to renew its existing insurance coverage
as and when such policies expire or (ii) to obtain comparable coverage from
similar institutions as may be necessary or appropriate to conduct its
business as now conducted and at a cost that would not result in a Material
Adverse Change. Neither the Company nor any subsidiary has been denied any
insurance coverage which it has sought or for which it has applied.

(u) No Price Stabilization or Manipulation. The Company has not taken
and will not take, directly or indirectly, any action designed to or that
might be reasonably expected to cause or result in stabilization or
manipulation of the price of any security of the Company to facilitate the
sale or resale of the Class B Common Shares in violation of applicable
securities laws.

(v) Related Party Transactions. There are no business relationships or
related-party transactions or relationships involving the Company or any
subsidiary of the Company or, to the best of the Company's knowledge, any
other person required to be described in the Prospectus which have not been
described as required.

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<PAGE>

(w) No Unlawful Contributions or Other Payments. Neither the Company
nor any of its subsidiaries nor, to the best of the Company's knowledge, any
employee or agent of the Company or any subsidiary, has made any contribution
or other payment to any official of, or candidate for, any federal, state or
foreign office in violation of any law or of the character required to be
disclosed in the Prospectus.

(x) Company's Accounting System. The Company maintains a system of
accounting controls sufficient to provide reasonable assurances that (i)
transactions are executed in accordance with management's general or specific
authorization; (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with United States generally
accepted accounting principles and to maintain accountability for assets;
(iii) access to assets is permitted only in accordance with management's
general or specific authorization; and (iv) the recorded accountability for
assets is compared with existing assets at reasonable intervals and
appropriate action is taken with respect to any differences.

(y) Compliance with Environmental Laws. Except as would not,
individually or in the aggregate, result in a Material Adverse Change (i)
neither the Company nor any of its subsidiaries is in violation of any
federal, state, local or foreign law or regulation relating to pollution or
protection of human health or the environment (including, without limitation,
ambient air, surface water, groundwater, land surface or subsurface strata) or
wildlife, including without limitation, laws and regulations relating to
emissions, discharges, releases or threatened releases of chemicals,
pollutants, contaminants, wastes, toxic substances, hazardous substances,
petroleum and petroleum products (collectively, "Materials of Environmental
Concern"), or otherwise relating to the manufacture, processing, distribution,
use, treatment, storage, disposal, transport or handling of Materials of
Environment Concern (collectively, "Environmental Laws"), which violation
includes, but is not limited to, noncompliance with any permits or other
governmental authorizations required for the operation of the business of the
Company or its subsidiaries under applicable Environmental Laws, or
noncompliance with the terms and conditions thereof, nor has the Company or
any of its subsidiaries received any written communication, whether from a
governmental authority, citizens group, employee or otherwise, that alleges
that the Company or any of its subsidiaries is in violation of any
Environmental Law; (ii) there is no claim, action or cause of action filed
with a court or governmental authority, no investigation with respect to which
the Company has received written notice, and no written notice by any person
or entity alleging potential liability for investigatory costs, cleanup costs,
governmental responses costs, natural resources damages, property damages,
personal injuries, attorneys' fees or penalties arising out of, based on or
resulting from the presence, or release into the environment, of any Material
of Environmental Concern at any location owned, leased or operated by the
Company or any of its subsidiaries, now or in the past (collectively,
"Environmental Claims"), pending or, to the best of the Company's knowledge,
threatened against the Company or any of its subsidiaries or any person or
entity whose liability for any Environmental Claim the Company or any of its
subsidiaries has retained or assumed either contractually or by operation of
law; and (iii) to the best of the Company's knowledge, there are no past or
present actions, activities, circumstances, conditions, events or incidents,
including, without limitation, the release, emission, discharge, presence or
disposal of any Material of Environmental Concern, that reasonably could
result in a violation of any Environmental Law or form the basis of a
potential Environmental Claim against the

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<PAGE>

Company or any of its subsidiaries or against any person or entity whose
liability for any Environmental Claim the Company or any of its subsidiaries
has retained or assumed either contractually or by operation of law.

(z) ERISA Compliance. The Company and its subsidiaries and any "employee
benefit plan" (as defined under the Employee Retirement Income Security Act of
1974, as amended, and the regulations and published interpretations thereunder
(collectively, "ERISA")) established or maintained by the Company, its
subsidiaries or their "ERISA Affiliates" (as defined below) are in compliance
in all material respects with ERISA. "ERISA Affiliate" means, with respect to
the Company or a subsidiary, any member of any group of organizations
described in Sections 414(b),(c),(m) or (o) of the Internal Revenue Code of
1986, as amended, and the regulations and published interpretations thereunder
(the "Code") of which the Company or such subsidiary is a member. No
"reportable event" (as defined under ERISA) has occurred or is reasonably
expected to occur with respect to any "employee benefit plan" established or
maintained by the Company, its subsidiaries or any of their ERISA Affiliates.
No "employee benefit plan" established or maintained by the Company, its
subsidiaries or any of their ERISA Affiliates, if such "employee benefit plan"
were terminated, would have any "amount of unfunded benefit liabilities" (as
defined under ERISA). Neither the Company, its subsidiaries nor any of their
ERISA Affiliates has incurred or reasonably expects to incur any liability
under (i) Title IV of ERISA with respect to termination of, or withdrawal
from, any "employee benefit plan" or (ii) Sections 412, 4971, 4975 or 4980B of
the Code. Each "employee benefit plan" established or maintained by the
Company, its subsidiaries or any of their ERISA Affiliates that is intended to
be qualified under Section 401(a) of the Code is so qualified and nothing has
occurred, whether by action or failure to act, which would cause the loss of
such qualification.

(aa) Merger Agreement. The execution and delivery of the Agreement and
Plan of Reorganization dated as of August 12, 1998 (the "Merger Agreement") by
and among CitySearch, USA Networks, Inc., Ticketmaster Group, Inc. and
Ticketmaster, TMOL and Tiberius, Inc. ("Tiberius") was duly authorized by all
necessary corporate action on the part of the Company and Tiberius. Each of
the Company and Tiberius had all corporate power and authority to execute and
deliver the Merger Agreement, to file the Merger Agreement with the Secretary
of State of the State of Delaware and to consummate the transactions
contemplated by the Merger Agreement, and the Merger Agreement at the time of
execution and filing constituted a valid and binding obligation of each of the
Company and Tiberius.

(bb) Year 2000 Compliance.

(a) All of the current or past products and/or services offered by
the Company and/or its subsidiaries and by Ticketmaster Corp., in the case of
Ticketmaster Corp., to the extent such products and services relate to or are
utilized in the online sale of live event tickets and related merchandise
(including any predecessor in interest), including each item of hardware,
software, or firmware, any system, equipment, or products consisting of or
containing one or more thereof, and any and all enhancements, upgrades,
customizations, modifications, maintenance and the like are Year 2000
Compliant (as defined herein). Neither the Company nor any of its subsidiaries
is subject to any pending or threatened claim, regulatory action, proceeding
or investigation concerning the Year 2000 Compliance of its respective
products, services or operations, and, to the Company's knowledge after a
reasonable investigation, there is no basis for any such claim, regulatory

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<PAGE>

action, investigation or proceeding. All of the internal management
information systems (including hardware, firmware, operating system software,
utilities, and applications software) and all facilities and systems used in
the ordinary course of business by or on behalf of the Company and its
subsidiaries, including payroll, accounting, billing/receivables, customer
service, human resources, and e-mail systems used by the Company and its
subsidiaries, are Year 2000 Compliant. To the best of the Company's knowledge,
after reasonable investigation, all vendors of products or services to the
Company and/or its subsidiaries, and its respective products, services and
operations, are Year 2000 Compliant, and each such vendor will continue to
furnish its products or services to the Company, without interruption or
material delay, on and after January 1, 2000.

(b) For purposes of this Agreement, "Year 2000 Compliant" means that
(1) the products, services, or other item(s) at issue accurately process,
provide and/or receive all date/time data (including calculating, comparing,
and sequencing) within, from, into, and between centuries (including the
twentieth and twenty-first centuries and the years 1999 and 2000), including
leap year calculations, and (2) neither the performance nor the functionality
nor the Company's provision of the products, services, and other item(s) at
issue will be affected by any dates/times prior to, on, after, or spanning
January 1, 2000. The design of the products, services, and other item(s) at
issue includes proper date/time data century recognition and recognition of
1999 and 2000, calculations that accommodate single century and multi-century
formulae and date/time values before, on, after, and spanning January 1, 2000,
and date/time data interface values that reflect the century, 1999, and 2000.

Any certificate signed by an officer of the Company and delivered to the
Representatives or to counsel for the Underwriters shall be deemed to be a
representation and warranty by the Company to each Underwriter as to the
matters set forth therein.

SECTION 2. PURCHASE, SALE AND DELIVERY OF THE CLASS B COMMON SHARES.

(a) The Firm Class B Common Shares. The Company agrees to issue and
sell to the several Underwriters the Firm Class B Common Shares upon the terms
herein set forth. On the basis of the representations, warranties and
agreements herein contained, and upon the terms but subject to the conditions
herein set forth, the Underwriters agree, severally and not jointly, to purchase
from the Company the respective number of Firm Class B Common Shares set forth
opposite their names on Schedule A. The purchase price per Firm Class B Common
----------
Share to be paid by the several Underwriters to the Company shall be $[___] per
share.

(b) The First Closing Date. Delivery of certificates for the Firm
Class B Common Shares to be purchased by the Underwriters and payment therefor
shall be made at the offices of NMS, 600 Montgomery Street, San Francisco,
California (or such other place as may be agreed to by the Company and the
Representatives) at 6:00 a.m. San Francisco time, on [___], or such other time
and date not later than 10:30 a.m. San Francisco time , on [___] as the
Representatives shall designate by notice to the Company (the time and date of
such closing are called the "First Closing Date"). The Company hereby
acknowledges that circumstances under which the Representatives may provide
notice to postpone the First Closing Date as originally scheduled include, but
are in no way limited to, any determination by the Company or the
Representatives to recirculate to the public copies of an amended or
supplemented Prospectus or a delay as contemplated by the provisions of Section
10.

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<PAGE>

(c) The Optional Class B Common Shares; the Second Closing Date. In
addition, on the basis of the representations, warranties and agreements herein
contained, and upon the terms but subject to the conditions herein set forth,
the Company hereby grants an option to the several Underwriters to purchase,
severally and not jointly, up to an aggregate of [___] Optional Class B Common
Shares from the Company at the purchase price per share to be paid by the
Underwriters for the Firm Class B Common Shares. The option granted hereunder
is for use by the Underwriters solely in covering any over-allotments in
connection with the sale and distribution of the Firm Class B Common Shares.
The option granted hereunder may be exercised at any time (but not more than
once) upon notice by the Representatives to the Company, which notice may be
given at any time within 30 days from the date of this Agreement. Such notice
shall set forth (i) the aggregate number of Optional Class B Common Shares as to
which the Underwriters are exercising the option, (ii) the names and
denominations in which the certificates for the Optional Class B Common Shares
are to be registered and (iii) the time, date and place at which such
certificates will be delivered (which time and date may be simultaneous with,
but not earlier than, the First Closing Date; and in such case the term "First
Closing Date" shall refer to the time and date of delivery of certificates for
the Firm Class B Common Shares and the Optional Class B Common Shares). Such
time and date of delivery, if subsequent to the First Closing Date, is called
the "Second Closing Date" and shall be determined by the Representatives and
shall not be earlier than three nor later than five full business days after
delivery of such notice of exercise. If any Optional Class B Common Shares are
to be purchased, each Underwriter agrees, severally and not jointly, to purchase
the number of Optional Class B Common Shares (subject to such adjustments to
eliminate fractional shares as the Representatives may determine) that bears the
same proportion to the total number of Optional Class B Common Shares to be
purchased as the number of Firm Class B Common Shares set forth on Schedule A
----------
opposite the name of such Underwriter bears to the total number of Firm Class B
Common Shares. The Representatives may cancel the option at any time prior to
its expiration by giving written notice of such cancellation to the Company.

(d) Public Offering of the Class B Common Shares. The
Representatives hereby advise the Company that the Underwriters intend to offer
for sale to the public, as described in the Prospectus, their respective
portions of the Class B Common Shares as soon after this Agreement has been
executed and the Registration Statement has been declared effective as the
Representatives, in their sole judgment, have determined is advisable and
practicable.

(e) Payment for the Class B Common Shares. Payment for the Class B
Common Shares shall be made at the First Closing Date (and, if applicable, at
the Second Closing Date) by wire transfer of immediately available funds to the
order of the Company.

It is understood that the Representatives have been authorized, for
their own account and the accounts of the several Underwriters, to accept
delivery of and receipt for, and make payment of the purchase price for, the
Firm Class B Common Shares and any Optional Class B Common Shares the
Underwriters have agreed to purchase. NMS, ACI, BSC, BRS or DLJ individually
and not as the Representatives of the Underwriters, may (but shall not be
obligated to) make payment for any Class B Common Shares to be purchased by any
Underwriter whose funds shall not have been received by the Representatives by
the First Closing Date or the Second Closing Date, as the case may be, for the
account of such Underwriter, but any such payment shall not relieve such
Underwriter from any of its obligations under this Agreement.

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<PAGE>

(f) Delivery of the Class B Common Shares. The Company shall
deliver, or cause to be delivered, to the Representatives for the accounts of
the several Underwriters certificates for the Firm Class B Common Shares at the
First Closing Date, against the irrevocable release of a wire transfer of
immediately available funds for the amount of the purchase price therefor. The
Company shall also deliver, or cause to be delivered, to the Representatives for
the accounts of the several Underwriters, certificates for the Optional Class B
Common Shares the Underwriters have agreed to purchase at the First Closing Date
or the Second Closing Date, as the case may be, against the irrevocable release
of a wire transfer of immediately available funds for the amount of the purchase
price therefor. The certificates for the Class B Common Shares shall be in
definitive form and registered in such names and denominations as the
Representatives shall have requested at least two full business days prior to
the First Closing Date (or the Second Closing Date, as the case may be) and
shall be made available for inspection on the business day preceding the First
Closing Date (or the Second Closing Date, as the case may be) at a location in
New York City as the Representatives may reasonably designate. Time shall be of
the essence, and delivery at the time and place specified in this Agreement is a
further condition to the obligations of the Underwriters.

(g) Delivery of Prospectus to the Underwriters. Not later than 12:00
p.m. on the second business day following the date the Class B Common Shares are
released by the Underwriters for sale to the public, the Company shall deliver
or cause to be delivered copies of the Prospectus in such quantities and at such
places as the Representatives shall reasonably request.

SECTION 3. ADDITIONAL COVENANTS.

(a) Representatives' Review of Proposed Amendments and Supplements.
During such period beginning on the date hereof and ending on the later of the
First Closing Date or such date, as in the opinion of counsel for the
Underwriters, the Prospectus is no longer required by law to be delivered in
connection with sales by an Underwriter or dealer (the "Prospectus Delivery
Period"), prior to amending or supplementing the Registration Statement
(including any registration statement filed under Rule 462(b) under the
Securities Act) or the Prospectus, the Company shall furnish to the
Representatives for review a copy of each such proposed amendment or
supplement, and the Company shall not file any such proposed amendment or
supplement to which the Representatives reasonably object.

(b) Securities Act Compliance. After the date of this Agreement, the
Company shall promptly advise the Representatives in writing (i) of the
receipt of any comments of, or requests for additional or supplemental
information from, the Commission, (ii) of the time and date of any filing of
any post-effective amendment to the Registration Statement or any amendment or
supplement to any preliminary prospectus or the Prospectus, (iii) of the time
and date that any post-effective amendment to the Registration Statement
becomes effective and (iv) of the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement or any post-
effective amendment thereto or of any order preventing or suspending the use
of any preliminary prospectus or the Prospectus, or (v) during the two year
period following the date hereof, of any proceedings to remove, suspend or
terminate from listing or quotation the Class B Common Stock from any
securities exchange upon which it is listed for trading or included or
designated for quotation, or of the threatening or initiation of any
proceedings for any of such purposes. If the Commission

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<PAGE>

shall enter any such stop order at any time, the Company will use its best
efforts to obtain the lifting of such order at the earliest possible moment.
Additionally, the Company agrees that it shall comply with the provisions of
Rules 424(b), 430A and 434, as applicable, under the Securities Act and will
use its reasonable efforts to confirm that any filings made by the Company
under such Rule 424(b) were received in a timely manner by the Commission.

(c) Amendments and Supplements to the Prospectus and Other Securities
Act Matters. If, during the Prospectus Delivery Period, any event shall occur
or condition shall exist as a result of which it is necessary to amend or
supplement the Prospectus in order to make the statements therein, in the
light of the circumstances when the Prospectus is delivered to a purchaser,
not misleading, or if in the opinion of the Representatives or counsel for the
Underwriters it is otherwise necessary to amend or supplement the Prospectus
to comply with law, the Company agrees to promptly prepare (subject to Section
3(a) hereof), file with the Commission and furnish at its own expense to the
Underwriters and to dealers, amendments or supplements to the Prospectus so
that the statements in the Prospectus as so amended or supplemented will not,
in the light of the circumstances when the Prospectus is delivered to a
purchaser, be misleading or so that the Prospectus, as amended or
supplemented, will comply with law.

(d) Copies of any Amendments and Supplements to the Prospectus. The
Company agrees to furnish the Representatives, without charge, during the
Prospectus Delivery Period, as many copies of the Prospectus and any
amendments and supplements thereto as the Representatives may reasonably
request.

(e) Blue Sky Compliance. The Company shall cooperate with the
Representatives and counsel for the Underwriters to qualify or register the
Class B Common Shares for sale under (or obtain exemptions from the
application of) state securities or blue sky laws or Canadian provincial
securities laws of those jurisdictions designated by the Representatives,
shall comply with such laws and shall continue such qualifications,
registrations and exemptions in effect so long as required for the
distribution of the Class B Common Shares. The Company shall not be required
to qualify as a foreign corporation or to take any action that would subject
it to general service of process in any such jurisdiction where it is not
presently qualified or where it would be subject to taxation as a foreign
corporation where it is not presently so subject. The Company will advise the
Representatives promptly of the suspension of the qualification or
registration of (or any such exemption relating to) the Class B Common Shares
for offering, sale or trading in any jurisdiction or any initiation or threat
of any proceeding for any such purpose, and in the event of the issuance of
any order suspending such qualification, registration or exemption, the
Company shall use its best efforts to obtain the withdrawal thereof at the
earliest possible moment.

(f) Use of Proceeds. The Company shall apply the net proceeds from the
sale of the Class B Common Shares sold by it in the manner described under the
caption "Use of Proceeds" in the Prospectus.

(g) Transfer Agent. The Company shall engage and maintain, at its
expense, a registrar and transfer agent for the Class B Common Stock.

(h) Earnings Statement. As soon as practicable, the Company will make
generally available to its security holders and to the Representatives an
earnings statement (which need

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<PAGE>

not be audited) covering the twelve-month period ending September 30, 1998
that satisfies the provisions of Section 11(a) of the Securities Act.

(i) Periodic Reporting Obligations. During the Prospectus Delivery Period
the Company shall file, on a timely basis, with the Commission and the Nasdaq
National Market all reports and documents required to be filed under the
Securities Exchange Act of 1934, as amended (the "Exchange Act").

(j) Agreement Not To Offer or Sell Additional Securities During the period
of 180 days following the date any of the Class B Common Shares is released by
the Representatives for sale to the public, the Company will not, without the
prior written consent of NMS (which consent may be withheld at the sole
discretion of NMS), directly or indirectly, sell, offer, contract or grant any
option to sell, pledge, transfer or establish an open "put equivalent
position" within the meaning of Rule 16a-1(h) under the Exchange Act, or
otherwise dispose of or transfer, or announce the offering of, or file any
registration statement under the Securities Act in respect of, any shares of
Common Stock, options or warrants to acquire shares of the Common Stock or
securities exchangeable or exercisable for or convertible into shares of
Common Stock (other than as contemplated by this Agreement with respect to the
Class B Common Shares); provided, however, that the Company may (i) issue,
without the prior written consent of NMS, shares of its Class B Common Stock
or options to purchase its Class B Common Stock, or Class A or Class B Common
Stock upon exercise of options, pursuant to any stock option, stock bonus or
other stock plan or arrangement described in the Prospectus, (ii) issue shares
of Class B Common Stock upon mandatory or voluntary conversion of Class A
Common Stock and (iii) issue shares of its Class A or Class B Common Stock, or
securities exchangeable or exercisable for or convertible into shares of Class
A or Class B Common Stock, as consideration in the acquisitions of businesses
(whether by merger, consolidation, purchase or otherwise).

(k) Future Reports to the Representatives. During the period of five years
hereafter the Company will furnish to the Representatives at 600 Montgomery
Street, San Francisco, CA 94111 Attention: Steve Baum, (i) as soon as
practicable after the end of each fiscal year, copies of the Annual Report of
the Company containing the balance sheet of the Company as of the close of
such fiscal year and statements of income, stockholders' equity and cash flows
for the year then ended and the opinion thereon of the Company's independent
public or certified public accountants; (ii) as soon as practicable after the
filing thereof, copies of each proxy statement, Annual Report on Form 10-K,
Quarterly Report on Form 10-Q, Current Report on Form 8-K or other report
filed by the Company with the Commission, the NASD or any securities exchange;
and (iii) as soon as available, copies of any report or communication of the
Company mailed generally to holders of its capital stock.

NMS, on behalf of the several Underwriters, may, in its sole discretion,
waive in writing the performance by the Company of any one or more of the
foregoing covenants or extend the time for their performance.

SECTION 4. PAYMENT OF EXPENSES. The Company agrees to pay all costs,
fees and expenses incurred in connection with the performance of its obligations
hereunder and in connection with the transactions contemplated hereby, including
without limitation (i) all expenses incident to the issuance and delivery of the
Class B Common Shares (including all

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printing and engraving costs), (ii) all fees and expenses of the registrar and
transfer agent of the Class B Common Stock, (iii) all necessary issue, transfer
and other stamp taxes in connection with the issuance and sale of the Class B
Common Shares to the Underwriters, (iv) all fees and expenses of the Company's
counsel, independent certified public accountants and other advisors, (v) all
costs and expenses incurred in connection with the preparation, printing,
filing, shipping and distribution of the Registration Statement (including
financial statements, exhibits, schedules, consents and certificates of
experts), each preliminary prospectus and the Prospectus, and all amendments and
supplements thereto, and this Agreement, (vi) all filing fees, attorneys' fees
and expenses incurred by the Company or the Underwriters in connection with
qualifying or registering (or obtaining exemptions from the qualification or
registration of) all or any part of the Class B Common Shares for offer and sale
under the state securities or blue sky laws or the provincial securities laws of
Canada, and, if requested by the Representatives, preparing and printing a "Blue
Sky Survey" or memorandum, and any supplements thereto, advising the
Underwriters of such qualifications, registrations and exemptions, (vii) the
filing fees incident to, and the reasonable fees and expenses of counsel for the
Underwriters in connection with, the NASD's review and approval of the
Underwriters' participation in the offering and distribution of the Class B
Common Shares, (viii) the fees and expenses associated with including the Class
B Common Shares on the Nasdaq National Market, and (ix) all other fees, costs
and expenses referred to in Item 13 of Part II of the Registration Statement.
Except as provided in this Section 4, Section 6, Section 8 and Section 9 hereof,
the Underwriters shall pay their own costs and expenses, including the fees and
disbursements of their counsel.

SECTION 5. CONDITIONS OF THE OBLIGATIONS OF THE UNDERWRITERS. The
obligations of the several Underwriters to purchase and pay for the Class B
Common Shares as provided herein on the First Closing Date and, with respect to
the Optional Class B Common Shares, the Second Closing Date, shall be subject to
the accuracy of the representations and warranties on the part of the Company
set forth in Section 1 hereof as of the date hereof and as of the First Closing
Date as though then made and, with respect to the Optional Class B Common
Shares, as of the Second Closing Date as though then made, to the timely
performance by the Company of its covenants and other obligations hereunder, and
to each of the following additional conditions:

(a) Accountants' Comfort Letter. On the date hereof, the Representatives
shall have received from Ernst & Young LLP, independent certified public
accountants for the Company, a letter dated the date hereof addressed to the
Underwriters, in form and substance satisfactory to the Representatives,
containing statements and information of the type ordinarily included in
accountant's "comfort letters" to underwriters, delivered according to
Statement of Auditing Standards No. 72 (or any successor bulletin), with
respect to the audited and unaudited financial statements and certain
financial information contained in the Registration Statement and the
Prospectus (and the Representatives shall have received an additional [___]
conformed copies of such accountants' letter for each of the several
Underwriters).

(b) Compliance with Registration Requirements; No Stop Order; No
Objection from NASD. For the period from and after effectiveness of this
Agreement and prior to the First Closing Date and, with respect to the
Optional Class B Common Shares, the Second Closing Date:

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<PAGE>

(i) the Company shall have filed the Prospectus with the Commission
(including the information required by Rule 430A under the Securities Act)
in the manner and within the time period required by Rule 424(b) under the
Securities Act; or the Company shall have filed a post-effective amendment
to the Registration Statement containing the information required by such
Rule 430A, and such post-effective amendment shall have become effective;
or, if the Company elected to rely upon Rule 434 under the Securities Act
and obtained the Representatives' consent thereto, the Company shall have
filed a Term Sheet with the Commission in the manner and within the time
period required by such Rule 424(b);

(ii) no stop order suspending the effectiveness of the Registration
Statement, any Rule 462(b) Registration Statement, or any post-effective
amendment to the Registration Statement, shall be in effect and no
proceedings for such purpose shall have been instituted or threatened by
the Commission; and

(iii) the NASD shall have raised no objection to the fairness and
reasonableness of the underwriting terms and arrangements.

(c) No Material Adverse Change or Ratings Agency Change. For the period
from and after the date of this Agreement and prior to the First Closing
Date and, with respect to the Optional Class B Common Shares, the Second
Closing Date:

(i) in the judgment of the Representatives there shall not have
occurred any Material Adverse Change; and

(ii) there shall not have occurred any downgrading, nor shall any
notice have been given of any intended or potential downgrading or of any
review for a possible change that does not indicate the direction of the
possible change, in the rating accorded any securities of the Company or
any of its subsidiaries by any "nationally recognized statistical rating
organization" as such term is defined for purposes of Rule 436(g)(2) under
the Securities Act.

(d) Opinion of Counsel for the Company. On each of the First Closing
Date and the Second Closing Date the Representatives shall have received the
favorable opinion of Wilson Sonsini Goodrich & Rosati, Professional
Corporation, counsel for the Company, dated as of such Closing Date, the form
of which is attached as Exhibit A (and the Representatives shall have received
---------
an additional [___] conformed copies of such counsel's legal opinion for each
of the several Underwriters).

(e) Opinion of Counsel for the Underwriters. On each of the First
Closing Date and the Second Closing Date the Representatives shall have
received the favorable opinion of Venture Law Group, A Professional
Corporation, counsel for the Underwriters, dated as of such Closing Date, with
respect to the matters set forth in paragraph (i), (vii) (with respect to
subparagraph (i) only), (viii), (ix), (x), (xi), (xii) and (xiii) (with
respect to the captions "Description of Capital Stock" and "Underwriting"
under subparagraph (i) only), and the next-to-last paragraph of Exhibit A (and
---------
the Representatives shall have received an additional [___] conformed copies
of such counsel's legal opinion for each of the several Underwriters).

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<PAGE>

(f) Officers' Certificate. On each of the First Closing Date and the
Second Closing Date the Representatives shall have received a written
certificate executed by the Chairman of the Board, Chief Executive Officer or
President of the Company and the Chief Financial Officer or Chief Accounting
Officer of the Company, dated as of such Closing Date, to the effect set forth
in subsections (b)(ii) and (c)(ii) of this Section 5, and further to the
effect that:

(i) for the period from and after the date of this Agreement and
prior to such Closing Date, there has not occurred any Material Adverse
Change;

(ii) the representations, warranties and covenants of the Company set
forth in Section 1 of this Agreement are true and correct with the same
force and effect as though expressly made on and as of such Closing Date;
and

(iii) the Company has complied with all the agreements and satisfied
all the conditions on its part to be performed or satisfied at or prior to
such Closing Date.

(g) Bring-down Comfort Letter. On each of the First Closing Date and the
Second Closing Date the Representatives shall have received from Ernst & Young
LLP, independent certified public accountants for the Company, a letter dated
such date, in form and substance satisfactory to the Representatives, to the
effect that they reaffirm the statements made in the letter furnished by them
pursuant to subsection (a) of this Section 5, except that the specified date
referred to therein for the carrying out of procedures shall be no more than
three business days prior to the First Closing Date or Second Closing Date, as
the case may be (and the Representatives shall have received an additional
[___] conformed copies of such accountants' letter for each of the several
Underwriters).

(h) Lock-Up Agreement from Certain Stockholders of the Company. On the
date hereof, each director of the Company owning shares of Common Stock, each
officer of the Company and the beneficial owners holding more than 90% of the
shares of Common Stock (as defined and determined according to Rule 13d-3
under the Exchange Act, except that a one hundred eighty day period shall be
used rather than the sixty day period set forth therein) shall be subject to
an agreement substantially in the form of Exhibit B hereto or shall be subject
--------
to an agreement with the Company similar in substance to such agreement and
such agreements shall be in full force and effect on each of the First Closing
Date and the Second Closing Date. To the extent that any holder of Common
Stock, options or warrants to acquire shares of Common Stock or any other
securities of the Company convertible into or exercisable or exchangeable for
is subject to an agreement with the Company and not the Representatives, the
Company will not release such holder from the terms of such agreement without
the consent of NMS.

(i) Additional Documents. On or before each of the First Closing Date
and the Second Closing Date, the Representatives and counsel for the
Underwriters shall have received such information, documents and opinions as
they may reasonably require for the purposes of enabling them to pass upon the
issuance and sale of the Class B Common Shares as contemplated herein, or in
order to evidence the accuracy of any of the representations and warranties,
or the satisfaction of any of the conditions or agreements, herein contained.

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<PAGE>

If any condition specified in this Section 5 is not satisfied when and as
required to be satisfied, this Agreement may be terminated with respect to the
Firm Class B Common Shares by the Representatives by notice to the Company at
any time on or prior to the First Closing Date and, with respect to the Optional
Class B Common Shares, at any time prior to the Second Closing Date, which
termination shall be without liability on the part of any party to any other
party, except that Section 4, Section 6, Section 8 and Section 9 shall at all
times be effective and shall survive such termination.

SECTION 6. REIMBURSEMENT OF UNDERWRITERS' EXPENSES. If this
Agreement is terminated by the Representatives pursuant to Section 5, Section 7,
Section 10 or Section 11, or if the sale to the Underwriters of the Class B
Common Shares on the First Closing Date is not consummated because of any
refusal, inability or failure on the part of the Company to perform any
agreement herein or to comply with any provision hereof, the Company agrees to
reimburse the Representatives and the other Underwriters (or such Underwriters
as have terminated this Agreement with respect to themselves), severally, upon
demand for all out-of-pocket expenses that shall have been reasonably incurred
by the Representatives and the Underwriters in connection with the proposed
purchase and the offering and sale of the Common Shares, including but not
limited to reasonable fees and disbursements of counsel, printing expenses,
travel expenses, postage, facsimile and telephone charges.

SECTION 7. EFFECTIVENESS OF THIS AGREEMENT.

This Agreement shall not become effective until the later of (i) the
execution of this Agreement by the parties hereto and (ii) notification by the
Commission to the Company and the Representatives of the effectiveness of the
Registration Statement under the Securities Act.

Prior to such effectiveness, this Agreement may be terminated by any
party by notice to each of the other parties hereto, and any such termination
shall be without liability on the part of (a) the Company to any Underwriter,
except that the Company shall be obligated to reimburse the expenses of the
Representatives and the Underwriters pursuant to Sections 4 and 6 hereof, (b)
any Underwriter to the Company, or (c) any party hereto to any other party
except that the provisions of Section 8 and Section 9 shall at all times be
effective and shall survive such termination.

SECTION 8. INDEMNIFICATION.

(a) Indemnification of the Underwriters. The Company agrees to
indemnify and hold harmless each Underwriter, its officers and employees, and
each person, if any, who controls any Underwriter within the meaning of the
Securities Act and the Exchange Act against any loss, claim, damage, liability
or expense, as incurred, to which such Underwriter or such controlling person
may become subject, under the Securities Act, the Exchange Act or other
federal or state statutory law or regulation, or at common law or otherwise
(including in settlement of any litigation, if such settlement is effected
with the written consent of the Company), insofar as, and to the extent that,
such loss, claim, damage, liability or expense (or actions in respect thereof
as contemplated below) arises out of or is based (i) upon any untrue statement
or alleged untrue statement of a material fact contained

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<PAGE>

in the Registration Statement, or any amendment thereto, including any
information deemed to be a part thereof pursuant to Rule 430A or Rule 434
under the Securities Act, or the omission or alleged omission therefrom of a
material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading; or (ii) upon any untrue statement or alleged untrue statement
of a material fact contained in any preliminary prospectus or the Prospectus
(or any amendment or supplement thereto), or the omission or alleged omission
therefrom of a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading; or (iii) in whole or in part upon any inaccuracy in the
representations and warranties of the Company contained herein; or (iv) in
whole or in part upon any failure of the Company to perform its obligations
hereunder or under law; or (v) any act or failure to act or any alleged act or
failure to act by any Underwriter in connection with, or relating in any
manner to, the Class B Common Stock or the offering contemplated hereby, and
which is included as part of or referred to in any loss, claim, damage,
liability or action arising out of or based upon any matter covered by clause
(i) or (ii) above, provided that the Company shall not be liable under this
clause (v) to the extent that a court of competent jurisdiction shall have
determined by a final judgment that such loss, claim, damage, liability or
action resulted directly from any such acts or failures to act undertaken or
omitted to be taken by such Underwriter through its bad faith or willful
misconduct; and to reimburse each Underwriter and each such controlling person
for any and all expenses (including the fees and disbursements of counsel
chosen by NMS) as such expenses are reasonably incurred by such Underwriter or
such controlling person in connection with investigating, defending, settling,
compromising or paying any such loss, claim, damage, liability, expense or
action; provided, however, that the foregoing indemnity agreement shall not
apply to any loss, claim, damage, liability or expense to the extent, but only
to the extent, arising out of or based upon any untrue statement or alleged
untrue statement or omission or alleged omission made in reliance upon and in
conformity with written information furnished to the Company by the
Representatives expressly for use in the Registration Statement, any
preliminary prospectus or the Prospectus (or any amendment or supplement
thereto); and provided, further, that with respect to any preliminary
prospectus, the foregoing indemnity agreement shall not inure to the benefit
of any Underwriter from whom the person asserting any loss, claim, damage,
liability or expense purchased Class B Common Shares, or any person
controlling such Underwriter, if copies of the Prospectus were timely
delivered to the Underwriter pursuant to Section 2 and a copy of the
Prospectus (as then amended or supplemented if the Company shall have
furnished any amendments or supplements thereto) was not sent or given by or
on behalf of such Underwriter to such person, if required by law so to have
been delivered, at or prior to the written confirmation of the sale of the
Class B Common Shares to such person, and if the Prospectus (as so amended or
supplemented) would have cured the defect giving rise to such loss, claim,
damage, liability or expense. The indemnity agreement set forth in this
Section 8(a) shall be in addition to any liabilities that the Company may
otherwise have.

(b) Indemnification of the Company, its Directors and Officers. Each
Underwriter agrees, severally and not jointly, to indemnify and hold harmless
the Company, each of its directors, each of its officers who signed the
Registration Statement and each person, if any, who controls the Company
within the meaning of the Securities Act or the Exchange Act, against any
loss, claim, damage, liability or expense, as incurred, to which the Company,
or any such director, officer or controlling person may become subject, under
the Securities Act, the Exchange Act, or other federal or state statutory law
or regulation, or at common

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<PAGE>

law or otherwise (including in settlement of any litigation, if such
settlement is effected with the written consent of such Underwriter), insofar
as such loss, claim, damage, liability or expense (or actions in respect
thereof as contemplated below) arises out of or is based upon any untrue or
alleged untrue statement of a material fact contained in the Registration
Statement, any preliminary prospectus or the Prospectus (or any amendment or
supplement thereto), or arises out of or is based upon the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading, in each case to the extent, but only to
the extent, that such untrue statement or alleged untrue statement or omission
or alleged omission was made in the Registration Statement, any preliminary
prospectus, the Prospectus (or any amendment or supplement thereto), in
reliance upon and in conformity with written information furnished to the
Company by the Representatives expressly for use therein; and to reimburse the
Company, or any such director, officer or controlling person for any legal and
other expense reasonably incurred by the Company, or any such director,
officer or controlling person in connection with investigating, defending,
settling, compromising or paying any such loss, claim, damage, liability,
expense or action. The Company hereby acknowledges that the only information
that the Underwriters have furnished to the Company expressly for use in the
Registration Statement, any preliminary prospectus or the Prospectus (or any
amendment or supplement thereto) are the statements set forth (A) as the
second to last paragraph on the inside front cover page of the Prospectus
concerning stabilization by the Underwriters and (B) in the table in the first
paragraph and as the [second and eighth] paragraphs under the caption
"Underwriting" in the Prospectus; and the Underwriters confirm that such
statements are correct. The indemnity agreement set forth in this Section 8(b)
shall be in addition to any liabilities that each Underwriter may otherwise
have.

(c) Notifications and Other Indemnification Procedures. Promptly after
receipt by an indemnified party under this Section 8 of notice of the
commencement of any action, such indemnified party will, if a claim in respect
thereof is to be made against an indemnifying party under this Section 8,
notify the indemnifying party in writing of the commencement thereof, but the
omission so to notify the indemnifying party will not relieve it from any
liability which it may have to any indemnified party for contribution or
otherwise than under the indemnity agreement contained in this Section 8 or to
the extent it is not prejudiced as a proximate result of such failure. In
case any such action is brought against any indemnified party and such
indemnified party seeks or intends to seek indemnity from an indemnifying
party, the indemnifying party will be entitled to participate in, and, to the
extent that it shall elect, jointly with all other indemnifying parties
similarly notified, by written notice delivered to the indemnified party
promptly after receiving the aforesaid notice from such indemnified party, to
assume the defense thereof with counsel reasonably satisfactory to such
indemnified party; provided, however, if the defendants in any such action
include both the indemnified party and the indemnifying party and the
indemnified party shall have reasonably concluded that a conflict may arise
between the positions of the indemnifying party and the indemnified party in
conducting the defense of any such action or that there may be legal defenses
available to it and/or other indemnified parties which are different from or
additional to those available to the indemnifying party, the indemnified party
or parties shall have the right to select separate counsel to assume such
legal defenses and to otherwise participate in the defense of such action on
behalf of such indemnified party or parties. Upon receipt of notice from the
indemnifying party to such indemnified party of such indemnifying party's
election so to assume the defense of such action and approval by

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<PAGE>

the indemnified party of counsel (which approval shall not be unreasonably
withheld), the indemnifying party will not be liable to such indemnified party
under this Section 8 for any legal or other expenses subsequently incurred by
such indemnified party in connection with the defense thereof unless (i) the
indemnified party shall have employed separate counsel in accordance with the
proviso to the next preceding sentence (it being understood, however, that the
indemnifying party shall not be liable for the reasonable expenses of more
than one separate counsel (together with local counsel), approved by the
indemnifying party (NMS in the case of Section 8(b) and Section 9),
representing the indemnified parties who are parties to such action) or (ii)
the indemnifying party shall not have employed counsel reasonably satisfactory
to the indemnified party to represent the indemnified party within a
reasonable time after notice of commencement of the action, in each of which
cases the fees and expenses of counsel shall be at the expense of the
indemnifying party.

(d) Settlements. The indemnifying party under this Section 8 shall not
be liable for any settlement of any proceeding effected without its written
consent, but if settled with such consent or if there is a final judgment for
the plaintiff, the indemnifying party agrees to indemnify the indemnified party
against any loss, claim, damage, liability or expense by reason of such
settlement or judgment. Notwithstanding the foregoing sentence, if at any time
an indemnified party shall have requested an indemnifying party to reimburse
the indemnified party for fees and expenses of counsel as contemplated by
Section 8(c) hereof, the indemnifying party agrees that it shall be liable for
any settlement of any proceeding effected without its written consent if (i)
such settlement is entered into more than 30 days after receipt by such
indemnifying party of the aforesaid request and (ii) such indemnifying party
shall not have reimbursed the indemnified party in accordance with such request
prior to the date of such settlement. If during any period of time the
indemnifying party is disputing in good faith the reasonableness of such fees
and expenses of counsel, such period of time shall not be counted in
calculating such 30-day period. No indemnifying party shall, without the prior
written consent of the indemnified party, effect any settlement, compromise or
consent to the entry of judgment in any pending or threatened action, suit or
proceeding in respect of which any indemnified party is or could have been a
party and indemnity was or could have been sought hereunder by such indemnified
party, unless such settlement, compromise or consent includes (i) an
unconditional release of such indemnified party from all liability on claims
that are the subject matter of such action, suit or proceeding and (ii) does
not include a statement as to or an admission of fault, culpability or a
failure to act, by or on behalf of the indemnified party.

SECTION 9. CONTRIBUTION.

If the indemnification provided for in Section 8 is for any reason
held to be unavailable to or otherwise insufficient to hold harmless an
indemnified party in respect of any losses, claims, damages, liabilities or
expenses referred to therein, then each indemnifying party shall contribute to
the aggregate amount paid or payable by such indemnified party, as incurred, as
a result of any losses, claims, damages, liabilities or expenses referred to
therein (i) in such proportion as is appropriate to reflect the relative
benefits received by the Company, on the one hand, and the

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<PAGE>

Underwriters, on the other hand, from the offering of the Class B Common Shares
pursuant to this Agreement or (ii) if the allocation provided by clause (i)
above is not permitted by applicable law, in such proportion as is appropriate
to reflect not only the relative benefits referred to in clause (i) above but
also the relative fault of the Company, on the one hand, and the Underwriters,
on the other hand, in connection with the statements or omissions or
inaccuracies in the representations and warranties herein which resulted in such
losses, claims, damages, liabilities or expenses, as well as any other relevant
equitable considerations. The relative benefits received by the Company, on the
one hand, and the Underwriters, on the other hand, in connection with the
offering of the Class B Common Shares pursuant to this Agreement shall be deemed
to be in the same respective proportions as the total net proceeds from the
offering of the Class B Common Shares pursuant to this Agreement (before
deducting expenses) received by the Company, and the total underwriting discount
received by the Underwriters, in each case as set forth on the front cover page
of the Prospectus (or, if Rule 434 under the Securities Act is used, the
corresponding location on the Term Sheet) bear to the aggregate initial public
offering price of the Class B Common Shares as set forth on such cover. The
relative fault of the Company, on the one hand, and the Underwriters, on the
other hand, shall be determined by reference to, among other things, whether any
such untrue or alleged untrue statement of a material fact or omission or
alleged omission to state a material fact or any such inaccurate or alleged
inaccurate representation or warranty relates to information supplied by the
Company, on the one hand, or the Underwriters, on the other hand, and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission.

The amount paid or payable by a party as a result of the losses,
claims, damages, liabilities and expenses referred to above shall be deemed to
include, subject to the limitations set forth in Section 8(c), any legal or
other fees or expenses reasonably incurred by such party in connection with
investigating or defending any action or claim. The provisions set forth in
Section 8(c) with respect to notice of commencement of any action shall apply if
a claim for contribution is to be made under this Section 9; provided, however,
that no additional notice shall be required with respect to any action for which
notice has been given under Section 8(c) for purposes of indemnification.

The Company and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this Section 9 were determined by pro rata
allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation which does not take account of the
equitable considerations referred to in this Section 9.

Notwithstanding the provisions of this Section 9, no Underwriter shall
be required to contribute any amount in excess of the underwriting commissions
received by such Underwriter in connection with the Class B Common Shares
underwritten by it and distributed to the public. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. The Underwriters' obligations to
contribute pursuant to this Section 9 are several, and not joint, in proportion
to their respective underwriting commitments as set forth opposite their names
in Schedule A. For purposes of this Section 9, each officer and employee of an
----------
Underwriter and each person, if any, who controls an Underwriter within the
meaning of the Securities Act and the Exchange Act shall have the same rights to
contribution as such Underwriter, and each director of the Company, each officer
of the Company who signed the Registration Statement, and each person, if any,
who controls the Company within the meaning of the Securities Act and the
Exchange Act shall have the same rights to contribution as the Company.

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<PAGE>

SECTION 10. DEFAULT OF ONE OR MORE OF THE SEVERAL UNDERWRITERS. If,
on the First Closing Date or the Second Closing Date, as the case may be, any
one or more of the several Underwriters shall fail or refuse to purchase Class B
Common Shares that it or they have agreed to purchase hereunder on such date,
and the aggregate number of Class B Common Shares which such defaulting
Underwriter or Underwriters agreed but failed or refused to purchase does not
exceed 10% of the aggregate number of the Class B Common Shares to be purchased
on such date, the other Underwriters shall be obligated, severally, in the
proportions that the number of Firm Class B Common Shares set forth opposite
their respective names on Schedule A bears to the aggregate number of Firm Class
----------
B Common Shares set forth opposite the names of all such non-defaulting
Underwriters, or in such other proportions as may be specified by the
Representatives with the consent of the non-defaulting Underwriters, to purchase
the Class B Common Shares which such defaulting Underwriter or Underwriters
agreed but failed or refused to purchase on such date. If, on the First Closing
Date or the Second Closing Date, as the case may be, any one or more of the
Underwriters shall fail or refuse to purchase Class B Common Shares and the
aggregate number of Class B Common Shares with respect to which such default
occurs exceeds 10% of the aggregate number of Class B Common Shares to be
purchased on such date, and arrangements satisfactory to the Representatives and
the Company for the purchase of such Class B Common Shares are not made within
48 hours after such default, this Agreement shall terminate without liability of
any party to any other party except that the provisions of Section 4, Section 8
and Section 9 shall at all times be effective and shall survive such
termination. In any such case either the Representatives or the Company shall
have the right to postpone the First Closing Date or the Second Closing Date, as
the case may be, but in no event for longer than seven days in order that the
required changes, if any, to the Registration Statement and the Prospectus or
any other documents or arrangements may be effected.

As used in this Agreement, the term "Underwriter" shall be deemed to
include any person substituted for a defaulting Underwriter under this Section
10. Any action taken under this Section 10 shall not relieve any defaulting
Underwriter from liability in respect of any default of such Underwriter under
this Agreement.

SECTION 11. TERMINATION OF THIS AGREEMENT. Prior to the First Closing
Date this Agreement may be terminated by the Representatives by notice given to
the Company if at any time (i) trading or quotation in any of the Company's
securities shall have been suspended or limited by the Commission or by the
Nasdaq Stock Market, or trading in securities generally on either the Nasdaq
Stock Market or the New York Stock Exchange shall have been suspended or
limited, or minimum or maximum prices shall have been generally established on
any of such stock exchanges by the Commission or the NASD; (ii) a general
banking moratorium shall have been declared by any of federal, New York,
Delaware or California authorities; (iii) there shall have occurred any outbreak
or escalation of national or international hostilities or any crisis or
calamity, or any change in the United States or international financial markets,
or any substantial change or development involving a prospective substantial
change in United States' or international political, financial or economic
conditions, as in the judgment of the Representatives is material and adverse
and makes it impracticable to market the Class B Common Shares in the manner and
on the terms described in the Prospectus or to enforce contracts for the sale of
securities; (iv) in the judgment of the Representatives there shall have
occurred any Material Adverse Change; or (v) the Company shall have sustained a
loss by strike, fire, flood, earthquake, accident or other calamity of such
character as in the judgment of the

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<PAGE>

Representatives may interfere materially with the conduct of the business and
operations of the Company regardless of whether or not such loss shall have been
insured. Any termination pursuant to this Section 11 shall be without liability
on the part of (a) the Company to any Underwriter, except that the Company shall
be obligated to reimburse the expenses of the Representatives and the
Underwriters pursuant to Sections 4 and 6 hereof, (b) any Underwriter to the
Company, or (c) of any party hereto to any other party except that the
provisions of Section 8 and Section 9 shall at all times be effective and shall
survive such termination.

SECTION 12. REPRESENTATIONS AND INDEMNITIES TO SURVIVE DELIVERY. The
respective indemnities, agreements, representations, warranties and other
statements of the Company, of its officers and of the several Underwriters set
forth in or made pursuant to this Agreement will remain in full force and
effect, regardless of any investigation made by or on behalf of any Underwriter
or the Company or any of its or their partners, officers or directors or any
controlling person, as the case may be, and will survive delivery of and payment
for the Class B Common Shares sold hereunder and any termination of this
Agreement.

SECTION 13. NOTICES. All communications hereunder shall be in
writing and shall be mailed, hand delivered or telecopied and confirmed to the
parties hereto as follows:

If to the Representatives:

NationsBanc Montgomery Securities LLC
600 Montgomery Street
San Francisco, California 94111
Facsimile: (415)249-5558
Attention: Richard A. Smith

with a copy to:

NationsBanc Montgomery Securities LLC
600 Montgomery Street
San Francisco, California 94111
Facsimile: (415) 249-5553
Attention: David A. Baylor, Esq.

and a copy to:

Venture Law Group
2800 Sand Hill Road
Menlo Park, California 94025
Facsimile: (650) 233-8386
Attention: Glen R. Van Ligten

If to the Company:

CitySearch, Inc.
790 E. Colorado Boulevard, Ste. 200

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<PAGE>

Pasadena, California 91101
Facsimile: (626) 660-2537
Attention: Brad Ramberg, Chief Financial Officer

with a copy to:

Wilson Sonsini Goodrich & Rosati
650 Page Mill Road
Palo Alto, California 94304-1050
Facsimile: (650) 493-6811
Attention: Larry W. Sonsini and John T. Sheridan

and:

USA Networks, Inc.
152 W. 57th Street
New York, New York 1001__
Facsimile: (212) 314-7329
Attention: General Counsel

Any party hereto may change the address for receipt of communications by giving
written notice to the others.

SECTION 14. SUCCESSORS. This Agreement will inure to the benefit
of and be binding upon the parties hereto, including any substitute Underwriters
pursuant to Section 10 hereof, and to the benefit of the employees, officers and
directors and controlling persons referred to in Section 8 and Section 9, and in
each case their respective successors, and personal representatives, and no
other person will have any right or obligation hereunder. The term "successors"
shall not include any purchaser of the Class B Common Shares as such from any of
the Underwriters merely by reason of such purchase.

SECTION 15. PARTIAL UNENFORCEABILITY. The invalidity or
unenforceability of any Section, paragraph or provision of this Agreement shall
not affect the validity or enforceability of any other Section, paragraph or
provision hereof. If any Section, paragraph or provision of this Agreement is
for any reason determined to be invalid or unenforceable, there shall be deemed
to be made such minor changes (and only such minor changes) as are necessary to
make it valid and enforceable.

SECTION 16. (A) GOVERNING LAW PROVISIONS. THIS AGREEMENT SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF
CALIFORNIA APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED IN SUCH STATE.

(b) Consent to Jurisdiction. Any legal suit, action or proceeding
arising out of or based upon this Agreement or the transactions contemplated
hereby ("Related Proceedings") may be instituted in the federal courts of the
United States of America located in the City and

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<PAGE>

County of San Francisco or the courts of the State of California in each case
located in the City and County of San Francisco (collectively, the "Specified
Courts"), and each party irrevocably submits to the exclusive jurisdiction
(except for proceedings instituted in regard to the enforcement of a judgment of
any such court (a "Related Judgment"), as to which such jurisdiction is non-
exclusive) of such courts in any such suit, action or proceeding. Service of any
process, summons, notice or document by mail to such party's address set forth
above shall be effective service of process for any suit, action or other
proceeding brought in any such court. The parties irrevocably and
unconditionally waive any objection to the laying of venue of any suit, action
or other proceeding in the Specified Courts and irrevocably and unconditionally
waive and agree not to plead or claim in any such court that any such suit,
action or other proceeding brought in any such court has been brought in an
inconvenient forum.

SECTION 17. GENERAL PROVISIONS. This Agreement constitutes the
entire agreement of the parties to this Agreement and supersedes all prior
written or oral and all contemporaneous oral agreements, understandings and
negotiations of the parties to this Agreement with respect to the subject matter
hereof. This Agreement may be executed in two or more counterparts, each one of
which shall be an original, with the same effect as if the signatures thereto
and hereto were upon the same instrument. This Agreement may not be amended or
modified unless in writing by all of the parties hereto, and no condition herein
(express or implied) may be waived unless waived in writing by each party whom
the condition is meant to benefit. The Table of Contents and the Section
headings herein are for the convenience of the parties only and shall not affect
the construction or interpretation of this Agreement.

Each of the parties hereto acknowledges that it is a sophisticated
business person who was adequately represented by counsel during negotiations
regarding the provisions hereof, including, without limitation, the
indemnification provisions of Section 8 and the contribution provisions of
Section 9, and is fully informed regarding said provisions. Each of the parties
hereto further acknowledges that the provisions of Sections 8 and 9 hereto
fairly allocate the risks in light of the ability of the parties to investigate
the Company, its affairs and its business in order to assure that adequate
disclosure has been made in the Registration Statement, any preliminary
prospectus and the Prospectus (and any amendments and supplements thereto), as
required by the Securities Act and the Exchange Act.

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<PAGE>

If the foregoing is in accordance with your understanding of our agreement,
kindly sign and return to the Company the enclosed copies hereof, whereupon this
instrument, along with all counterparts hereof, shall become a binding agreement
in accordance with its terms.

Very truly yours,

CITYSEARCH, INC.

By:__________________________
Charles Conn
Chief Executive Officer

The foregoing Underwriting Agreement is hereby confirmed and accepted by
the Representatives in San Francisco, California as of the date first above
written.

NATIONSBANC MONTGOMERY SECURITIES LLC
ALLEN & COMPANY INCORPORATED
BANCAMERICA ROBERTSON STEPHENS
BEAR, STEARNS & CO. INC.
DONALDSON, LUFKIN & JENRETTE SECURITIES CORPORATION
Acting as Representatives of the
several Underwriters named in
the attached Schedule A.

By NATIONSBANC MONTGOMERY SECURITIES LLC

By: _____________________________
Richard A. Smith
Managing Director

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<PAGE>

SCHEDULE A

NUMBER OF FIRM CLASS B
COMMON SHARES TO BE
UNDERWRITERS PURCHASED

NationsBanc Montgomery Securities LLC.............. [___]
Allen & Company Incorporated....................... [___]
BancAmerica Robertson Stephens [___]
Bear, Stearns & Co. Inc. .......................... [___]
Donaldson, Lufkin & Jenrette Securities [___]
Corporation
[___].............................................. [___]
[___].............................................. [___]

Total .................................... [___]
<PAGE>

EXHIBIT A
The final opinion in draft form should be attached as Exhibit A at the time this
Agreement is executed.

Opinion of counsel for the Company to be delivered pursuant to Section
5(d) of the Underwriting Agreement.

References to the Prospectus in this Exhibit A include any supplements
---------
thereto at the Closing Date.

(i) The Company has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of Delaware.

(ii) The Company has corporate power and authority to own, lease and
operate its properties and to conduct its business as described in the
Prospectus and to enter into and perform its obligations under the
Underwriting Agreement.

(iii) The Company is duly qualified as a foreign corporation to transact
business and is in good standing in the State of California and in each other
jurisdiction in which such qualification is required, whether by reason of the
ownership or leasing of property or the conduct of business, except for such
jurisdictions (other than the State of California) where the failure to so
qualify or to be in good standing would not, individually or in the aggregate,
result in a Material Adverse Change.

(iv) Ticketmaster Multimedia Holdings, Inc. and each of the Company's
significant subsidiaries (as defined in Rule 405 under the Securities Act) has
been duly incorporated and is validly existing as a corporation in good
standing under the laws of the jurisdiction of its incorporation, has
corporate power and authority to own, lease and operate its properties and to
conduct its business as described in the Prospectus and, to the knowledge of
such counsel, is duly qualified as a foreign corporation to transact business
and is in good standing in each jurisdiction in which such qualification is
required, whether by reason of the ownership or leasing of property or the
conduct of business, except for such jurisdictions where the failure to so
qualify or to be in good standing would not, individually or in the aggregate,
result in a Material Adverse Change.

(v) All of the issued and outstanding capital stock of MetroBeat, Inc.
and Ticketmaster Multimedia Holdings, Inc., respectively, has been duly
authorized and validly issued, is fully paid and non-assessable and is owned
by the Company, free and clear of any security interest, mortgage, pledge,
lien, encumbrance or, to the best knowledge of such counsel, any pending or
threatened claim.

(vi) The authorized, issued and outstanding capital stock of the Company
(including the Class B Common Stock) conforms in all material respects to the
descriptions thereof set forth or incorporated by reference in the Prospectus.
All of the outstanding shares of Common Stock have been duly authorized and
validly issued, are fully paid and nonassessable and, to such counsel's
knowledge, have been issued in compliance with the

A-1
<PAGE>

registration and qualification requirements of all applicable federal and
state securities laws. The form of certificate used to evidence the Class B
Common Stock is in due and proper form and complies with all applicable
requirements of the charter and by-laws of the Company and the General
Corporation Law of the State of Delaware. The description of the Company's
stock option, stock bonus and other stock plans or arrangements, and the
options or other rights granted and exercised thereunder, set forth in the
Prospectus accurately and fairly presents in all material respects the
information required to be shown with respect to such plans, arrangements,
options and rights.

(vii) No stockholder of the Company or any other person has any
preemptive right, right of first refusal or other similar right to subscribe
for or purchase securities of the Company arising (i) by operation of the
charter or by-laws of the Company or the General Corporation Law of the State
of Delaware or (ii) to the best knowledge of such counsel, otherwise, except
for such rights as have been duly waived.

(viii) The Underwriting Agreement has been duly authorized, executed and
delivered by, and is a valid and binding agreement of, the Company,
enforceable in accordance with its terms, except as rights to indemnification
thereunder may be limited by applicable law and except as the enforcement
thereof may be limited by bankruptcy, insolvency, reorganization, moratorium
or other similar laws relating to or affecting creditors' rights generally or
by general equitable principles.

(ix) The Class B Common Shares to be purchased by the Underwriters
from the Company have been duly authorized for issuance and sale pursuant to
the Underwriting Agreement and, when issued and delivered by the Company
pursuant to the Underwriting Agreement against payment of the consideration
set forth therein, will be validly issued, fully paid and nonassessable and
issued in compliance with all applicable federal and state securities laws.

(x) Each of the Registration Statement and the Rule 462(b)
Registration Statement, if any, has been declared effective by the Commission
under the Securities Act. To the knowledge of such counsel, no stop order
suspending the effectiveness of either of the Registration Statement or the
Rule 462(b) Registration Statement, if any, has been issued under the
Securities Act and no proceedings for such purpose have been instituted or are
pending or are contemplated or threatened by the Commission. Any required
filing of the Prospectus and any supplement thereto pursuant to Rule 424(b)
under the Securities Act has been made in the manner and within the time
period required by such Rule 424(b).

(xi) The Registration Statement, including any Rule 462(b)
Registration Statement, the Prospectus including any document incorporated by
reference therein, and each amendment or supplement to the Registration
Statement and the Prospectus including any document incorporated by reference
therein, as of their respective effective or issue dates (other than the
financial statements and supporting schedules included or incorporated by
reference therein or in exhibits to or excluded from the Registration
Statement, as to which no opinion need be rendered) comply as to form in all
material respects with the applicable requirements of the Securities Act.

A-2
<PAGE>

(xii) The Class B Common Shares have been approved for listing on
the Nasdaq National Market.

(xiii) The statements (i) on the cover of the Prospectus and in the
Prospectus under the captions "Prospectus Summary --Ticketmaster Online-
CitySearch Merger," "Prospectus Summary--the Offering," "Risk Factors--
Dependence on Relationship with Ticketmaster Corp.," "Risk Factors--Control by
and Relationship with USA," "Risk Factors--Conflicts of Interest," "Risk
Factors--Potential Governmental Investigation and Litigation," "Risk Factors--
Uncertain Protection of Intellectual Property; Risks of Third Party Licenses,"
"Risk Factors--Antitakeover Effects of Certain Charter and Contractual
Provisions," "Management's Discussion and Analysis of Financial Condition and
Results of Operations--Overview," "Description of Capital Stock," "Business--
Ticketmaster Online Business-Ticketmaster License Agreement," "Business--
Proprietary Rights," "Ticketmaster Online-CitySearch Merger," "Shares Eligible
for Future Sale" and "Underwriting" and (ii) in Item 14 and Item 15 of the
Registration Statement, insofar as such statements constitute matters of law,
summaries of legal matters, the Company's charter or by-law provisions,
documents or legal proceedings, or legal conclusions, have been reviewed by
such counsel and fairly present and summarize, in all material respects, the
matters referred to therein.

(xiv) To the knowledge of such counsel, there are no legal or
governmental actions, suits or proceedings pending or threatened which are
required to be disclosed in the Registration Statement, other than those
disclosed therein.

(xv) To the knowledge of such counsel, there are no Existing
Instruments (or any amendments or supplements thereto) required to be
described or referred to in the Registration Statement or to be filed as
exhibits thereto other than those described or referred to therein or filed or
incorporated by reference as exhibits thereto; and the descriptions thereof
and references thereto are correct in all material respects.

(xvi) No consent, approval, authorization or other order of, or
registration or filing with, any court or other governmental authority or
agency, is required for the Company's execution, delivery and performance of
the Underwriting Agreement and consummation of the transactions contemplated
thereby and by the Prospectus, except as required under the Securities Act,
applicable state securities or blue sky laws, and the rules and regulations
promulgated by the NASD.

(xvii) The execution and delivery of the Underwriting Agreement by
the Company and the performance by the Company of its obligations thereunder
(other than performance by the Company of its obligations under the
indemnification section of the Underwriting Agreement, as to which no opinion
need be rendered) (i) have been duly authorized by all necessary corporate
action on the part of the Company; (ii) will not result in any violation of
the provisions of the charter or by-laws of the Company or any subsidiary;
(iii) will not to the knowledge of such counsel constitute a breach of, or
Default under, or result in the creation or imposition of any lien, charge or
encumbrance upon any property or assets of the Company or any of its
subsidiaries pursuant to, any material Existing Instrument; or (iv) to

A-3
<PAGE>

the knowledge of such counsel, will not result in any violation of any law,
administrative regulation or administrative or court decree applicable to the
Company or any subsidiary, which violation, individually or in the aggregate,
would result in a Material Adverse Change.

(xviii) The Company is not, and after receipt of payment for the
Common Shares will not be, an "investment company" within the meaning of
Investment Company Act.

(xix) Except as disclosed in the Prospectus under the caption
"Shares Eligible for Future Sale", to the knowledge of such counsel, there are
no persons with registration or other similar rights to have any equity or
debt securities registered for sale under the Registration Statement or
included in the offering contemplated by the Underwriting Agreement, except
for such rights as have been duly waived.

(xx) To the knowledge of such counsel, neither the Company,
MetroBeat, Inc. nor Ticketmaster Multimedia Holdings, Inc. is in violation of
its charter or by-laws or any law, administrative regulation or administrative
or court decree applicable to the Company or any such subsidiary or is in
Default in the performance or observance of any obligation, agreement,
covenant or condition contained in any material Existing Instrument, except in
each such case for such violations or Defaults as would not, individually or
in the aggregate, result in a Material Adverse Change.

(xxi) The execution and delivery of the Merger Agreement was duly
authorized by all necessary corporate action on the part of each of the
Company and Tiberius, Inc.; and

(xxii) Each of the Company and Tiberius, Inc. had all corporate power
and authority to execute and deliver the Merger Agreement, to file the Merger
Agreement with the Secretary of State of the State of Delaware and to
consummate the transaction contemplated by the Merger Agreement, and the
Merger Agreement at the time of execution and filing constituted a valid and
binding obligation of each of the Company and Tiberius, Inc.

In addition, such counsel shall state that they have participated in
conferences with officers and other representatives of the Company,
representatives of the independent public or certified public accountants for
the Company and with representatives of the Underwriters at which the contents
of the Registration Statement and the Prospectus, and any supplements or
amendments thereto, and related matters were discussed and, although such
counsel is not passing upon and does not assume any responsibility for the
accuracy, completeness or fairness of the statements contained in the
Registration Statement or the Prospectus (other than as specified above), and
any supplements or amendments thereto, on the basis of the foregoing, nothing
has come to their attention which would lead them to believe that either the
Registration Statement or any amendments thereto, at the time the Registration
Statement or such amendments became effective, contained an untrue statement
of a material fact or omitted to state a material fact required to be stated
therein or necessary to make the statements therein not misleading or that the
Prospectus, as of its date or at the First Closing Date or the Second Closing
Date, as the case may be, contained an untrue statement of a material fact or
omitted to state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading (it

A-4
<PAGE>

being understood that such counsel need express no belief as to the financial
statements or schedules or other financial or statistical data derived
therefrom, included or incorporated by reference in the Registration Statement
or the Prospectus or any amendments or supplements thereto).

In rendering such opinion, such counsel may rely (A) as to matters
involving the application of laws of any jurisdiction other than the General
Corporation Law of the State of Delaware, the General Corporation Law of the
State of California or the federal law of the United States, to the extent they
deem proper and specified in such opinion, upon the opinion (which shall be
dated the First Closing Date or the Second Closing Date, as the case may be,
shall be satisfactory in form and substance to the Underwriters, shall expressly
state that the Underwriters may rely on such opinion as if it were addressed to
them and shall be furnished to the Representatives) of other counsel of good
standing whom they believe to be reliable and who are satisfactory to counsel
for the Underwriters; provided, however, that such counsel shall further state
that they believe that they and the Underwriters are justified in relying upon
such opinion of other counsel, and (B) as to matters of fact, to the extent they
deem proper, on certificates of responsible officers of the Company and public
officials.

A-5
<PAGE>

This agreement is irrevocable and will be binding on the undersigned and the
respective successors, heirs, personal representatives, and assigns of the
undersigned.

_____________________________________________
Printed Name of Holder

By:__________________________________________
Signature

_____________________________________________
Printed Name of Person Signing
(and indicate capacity of person signing if
signing as custodian, trustee, or on behalf
of an entity)
<PAGE>

EXHIBIT B
[Date]

NationsBanc Montgomery Securities LLC
Allen & Company Incorporated
BancAmerica Robertson Stephens
Bear, Stearns & Co. Inc.
Donaldson, Lufkin & Jenrette Securities Corporation
As Representatives of the Several Underwriters
c/o NationsBanc Montgomery Securities LLC
600 Montgomery Street
San Francisco, California 94111

RE: CitySearch, Inc. (or any successor-in-interest thereto) (the "Company")

Ladies & Gentlemen:

The undersigned is an owner of record or beneficially of certain shares of Class
A Common Stock of the Company or securities convertible into or exchangeable or
exercisable for Class A or Class B Common Stock of the Company (together or
individually hereinafter defined as "Common Stock"). The Company proposes to
carry out a public offering of Class B Common Stock (the "Offering") for which
you will act as the representatives (the "Representatives") of the underwriters.
The undersigned recognizes that the Offering will be of benefit to the
undersigned and will benefit the Company by, among other things, raising
additional capital for its operations. The undersigned acknowledges that you
and the other underwriters are relying on the representations and agreements of
the undersigned contained in this letter in carrying out the Offering and in
entering into underwriting arrangements with the Company with respect to the
Offering.

In consideration of the foregoing, the undersigned hereby agrees that the
undersigned will not, without the prior written consent of NationsBanc
Montgomery Securities LLC (which consent may be withheld in its sole
discretion), directly or indirectly, sell, offer, contract or grant any option
to sell (including without limitation any short sale) pledge, transfer,
establish an open "put equivalent position" within the meaning of Rule 16a-1(h)
under the Securities Exchange Act of 1934, as amended, or otherwise dispose of
any shares of Common Stock, options or warrants to acquire shares of Common
Stock, securities exchangeable or exercisable for or convertible into shares of
Common Stock or any other securities of the Company currently or hereafter owned
either of record or beneficially (as defined in Rule 13d-3 under Securities
Exchange Act of 1934, as amended) by the undersigned, or publicly announce the
undersigned's intention to do any of the foregoing, for a period commencing on
the date hereof and continuing to a date 180 days after the first date any of
the Common Stock to be sold in the Offering is released by you for sale to the
public. The undersigned also agrees and consents to the entry of stop transfer
instructions with the Company's transfer agent and registrar against the
transfer of shares of Common Stock or securities convertible into or
exchangeable or exercisable for Common Stock or any other securities of the
Company held by the undersigned except in compliance with the foregoing
restrictions.

<PAGE>

EXHIBIT 3.2

AMENDED AND RESTATED CERTIFICATE OF INCORPORATION

TICKETMASTER ONLINE-CITYSEARCH, INC.

A DELAWARE CORPORATION

Ticketmaster Online-CitySearch, Inc., a corporation organized and
existing under and by virtue of the General Corporation Law of Delaware (the
"Corporation"), does hereby certify as follows:

FIRST: The original Certificate of Incorporation of the Corporation was
filed under the name of "PerfectMarket, Inc." with the Secretary of State of the
State of Delaware (the "Secretary") on September 20, 1995.

SECOND: This Amended and Restated Certificate of Incorporation has been
duly adopted in accordance with the provisions of Sections 242 and 245 of the
General Corporation Law of the State of Delaware by the Board of Directors of
the Corporation.

THIRD: This Amended and Restated Certificate of Incorporation was approved
by written consent of the stockholders pursuant to Section 228 of the General
Corporation Law of the State of Delaware.

FOURTH: That written notice of this Amended and Restated Certificate of
Incorporation was duly given to stockholders of this Corporation who did not
consent in writing to the foregoing resolutions.

FIFTH: The Amended and Restated Certificate of Incorporation of this
Corporation is amended and restated in its entirety to read as follows:

The name of the Corporation is Ticketmaster Online-CitySearch, Inc.

II.

The address of the Corporation's registered office in the State of Delaware
is 1209 Orange Street, in the City of Wilmington, County of New Castle. The
name of its registered agent at such address is The Corporation Trust Company.
<PAGE>

III.

The purpose of the Corporation is to engage in any lawful act or activity
for which corporations may be organized under the General Corporation Law of the
State of Delaware.

IV.

The Corporation is authorized to issue four classes of stock to be
designated "Class A Common Stock," "Class B Common Stock", "Class C Common
Stock" (the Class A Common Stock, Class B Common Stock and Class C Common Stock
are sometimes referred to collectively hereinafter as the "Common Stock"),and
"Preferred Stock," all of which shall have a par value of $0.01 per share. The
total number of shares which the Corporation is authorized to issue is three
hundred fifty-four million eight hundred and eighty-three thousand and five
hundred and six (354,883,506) shares. One hundred million (100,000,000) shares
shall be Class A Common Stock, two hundred and fifty million (250,000,000)
shares shall be Class B Common Stock and two million eight hundred and eighty-
three thousand and five hundred six (2,883,506) shares shall be Class C Common
Stock and two million (2,000,000) shares shall be Preferred Stock.

In case any shares of Preferred Stock shall be redeemed or converted
pursuant to the terms hereof, the shares so converted or redeemed shall be
canceled and shall not be issuable by the Corporation. From time to time this
Restated Certificate of Incorporation shall be appropriately revised to reflect
the corresponding reduction in the Corporation's authorized capital stock.

A. COMMON STOCK

The rights, preferences, restrictions and other matters relating to the
Common Stock are as follows:

1. DIVIDENDS. The holders of the Class A Common Stock, the Class B
---------
Common Stock and the Class C Common Stock shall be entitled to receive, on a
share-for-share basis, such dividends if, as and when declared from time to time
by the Board of Directors of the Corporation (the "Board of Directors").

2. LIQUIDATION. In the event of the voluntary or involuntary
-----------
liquidation, dissolution, distribution of assets or winding-up of the
Corporation, the holders of the Class A Common Stock, the Class B Common Stock,
and the Class C Common Stock shall be entitled to receive, on a share-for-share
basis, all of the assets of the Corporation of whatever kind available for
distribution to stockholders.

3. VOTING RIGHTS. Except as otherwise provided herein or required by
-------------
applicable law or the Amended and Restated Agreement and Plan of Reorganization,
dated as of August 12, 1998 (the "Merger Agreement"), by and among the
Corporation, USA Networks, Inc. ("USAi"), Ticketmaster Group, Inc. ("TM Group"),
Ticketmaster Corporation ("TM Corp.", and together with TM Group, "TM"),
Ticketmaster Multimedia Holdings, Inc. and Tiberius, Inc., (i) each holder of
Class A Common Stock shall be entitled to vote fifteen (15) votes for each share
of Class A Common Stock held as of the applicable date on any matter that is
submitted to a vote or to the consent of the stockholders of the Corporation,
(ii) each holder of Class B Common Stock shall be entitled to vote one (1) vote
for each share of Class B Common Stock held as of the applicable date on any
matter that is submitted to a vote or to the consent of the stockholders of the
Corporation and (iii) each holder of Class C Common Stock shall be entitled to
no vote for each shares of Class C Common Stock held as of the applicable date
on

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<PAGE>

any matter that is submitted to a vote or to the consent of the stockholders of
the Corporation. Holders of Common Stock shall be entitled to notice of any
stockholders' meeting in accordance with the Bylaws of the Corporation. Except
as otherwise required by applicable law, the Class A Common Stock and the Class
B Common Stock shall vote together as a single class on all matters submitted to
a vote or to the consent of the stockholders of the Corporation. Holders of
Stock of any class or series of this Corporation shall not be entitled to
cumulate their votes for the election of directors or any other matter submitted
to a vote of the stockholders.

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<PAGE>

4. CONVERSION.
----------

(a) Each share of Class A Common Stock shall be convertible into one
fully paid and nonassessable share of Class B Common Stock at the option of the
holder thereof at any time.

(b) Each share of Class A Common Stock shall automatically be
converted into one fully paid and nonassessable share of Class B Common Stock
upon any sale, pledge, conveyance, hypothecation, assignment or other transfer
(a "Transfer") of such share, whether or not for value, by the initial
registered holder (the "Initial Holder") thereof, other than any such Transfer
by such holder to (i) a nominee of such holder (without any change in
beneficial ownership, as such term is defined under Section 13(d) of the
Securities Exchange Act of 1934, as amended (the "Exchange Act")) or (ii)
another person that, at the time of such Transfer, beneficially owns shares of
Class A Common Stock or a nominee thereof; provided that, notwithstanding the
foregoing, (A) any Transfer by the Initial Holder without consideration to (1)
any affiliated entity of such Initial Holder, (2) a partner, active or retired,
of such Initial Holder, (3) the estate of any such Initial Holder or a trust
established for the benefit of the descendants or any relatives or spouse of
such Initial Holder, (4) a parent corporation or wholly-owned subsidiary of such
Initial Holder or to a wholly-owned subsidiary of such parent unless and until
such transferee ceases to be a parent or wholly-owned subsidiary of the Initial
Holder or a wholly-owned subsidiary of such parent, or (5) the spouse of such
Initial Holder, in each case, shall not result in such conversion or (B) any
bona fide pledge by the Initial Holder to any financial institution in
connection with a borrowing shall not result in such conversion; and provided,
further that in the event any Transfer shall not give rise to automatic
conversion hereunder, then any subsequent Transfer by the holder (other than any
such Transfer by such holder to a nominee of such holder (without any change in
beneficial ownership)) or the pledgor, as the case may be, shall be subject to
automatic conversion upon the terms and conditions set forth herein.

(c) The one-to-one conversion ratio for the conversion of the Class A
Common Stock into Class B Common Stock in accordance with Section 4(a) and 4(b)
above shall in all events be equitably preserved in the event of any merger,
consolidation or other reorganization of the Corporation with another
corporation.

(d) The Corporation shall at all times reserve and keep available out
of its authorized but unissued shares of Class B Common Stock, solely for the
purpose of effecting the conversion of the shares of the Class A Common Stock,
such number of its shares of Class B Common Stock as shall from time to time be
sufficient to effect the conversion of all outstanding shares of Class A Common
Stock.

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<PAGE>

(e) In case any shares of Class A Common Stock shall be converted
pursuant to this Section 4, the shares so converted shall be canceled and shall
not be subject to reissue by the Corporation. From time to time, this Amended
and Restated Certificate of Incorporation shall be appropriately revised to
reflect the corresponding reduction in the Corporation's authorized capital
stock.

5. STOCK DIVIDENDS OR STOCK SPLITS OR COMBINATIONS. In no event shall
-----------------------------------------------
any stock dividends or stock splits or combinations of stock be declared or made
in Class A Common Stock, Class B Common Stock or Class C Common Stock unless all
shares of Class A Common Stock, Class B Common Stock and Class C Common Stock
then outstanding are treated equally and identically.

B. PREFERRED STOCK. The Board of Directors shall, by resolution,
designate the powers, preferences, rights and qualifications, limitations and
restrictions of the Preferred Stock.

CONDUCT OF CERTAIN AFFAIRS OF THE CORPORATION

SECTION 5.1. In anticipation of the possibility that the Corporation and
USA Networks (as defined below) may engage in the same or similar activities or
lines of business and have an interest in the same areas of corporate
opportunities, and in recognition of the benefits to be derived by the
Corporation through its continued contractual, corporate and business relations
with USA Networks (including possible service of officers and directors of USA
Networks as officers and directors of the Corporation), the provisions of this
Article V are set forth to regulate and define the conduct of certain affairs
of the Corporation as they may involve USA Networks and its officers and
directors, and the powers, rights, duties and liabilities of the Corporation and
its officers, directors and stockholders in connection therewith.

SECTION 5.2. USA Networks shall have no duty to refrain from engaging in
the same or similar activities or lines of business as the Corporation, and
neither USA Networks nor any officer, director or employee thereof (except as
provided in Section 5.3 below) shall be liable to the Corporation or its
stockholders for breach of any fiduciary duty by reason of any such activities
of USA Networks. In the event that USA Networks acquires knowledge of a
potential transaction or matter which may be a corporate opportunity for both
USA Networks and the Corporation. USA Networks shall have no duty to
communicate or offer such corporate opportunity to the Corporation and shall not
be liable to the Corporation or its stockholders for breach of any fiduciary
duty as a stockholder of the Corporation by reason of the fact that USA Networks
pursues or acquires such corporate opportunity for itself, directs such
corporate opportunity to another person, or does not communicate information
regarding such corporate opportunity to the Corporation. Nothing in this Article
V shall amend or modify in any respect any written contractual agreement between
USA Networks and the Corporation.

SECTION 5.3. In the event that a director or officer of the Corporation
who is also a director, officer or employee of USA Networks acquires knowledge
of a potential transaction or matter which may be a corporate opportunity for
both the Corporation and USA Networks, such director or officer of the
Corporation shall have fully satisfied and fulfilled the fiduciary duty of such
director or officer to the Corporation and its stockholders with respect to such
corporate opportunity, if such director or officer acts in a manner consistent
with the following policy.

(a) A corporate opportunity offered to any person who is an officer
of the Corporation and who is also a director but not an officer or
employee of USA Networks, shall belong to the Corporation.

(b) A corporate opportunity offered to any person who is a director
but not an officer of the Corporation, and who is also a director, officer
or employee of USA Networks shall belong to the Corporation if such
opportunity is expressly offered to such person in his or her capacity as a
director of the Corporation, and otherwise shall belong to USA Networks;
and

(c) A corporate opportunity offered to any person who is an officer
or employee of USA Networks and an officer of the Corporation shall belong
to the Corporation if such opportunity is expressly offered to such person
in his or her capacity as an officer or employee of the Corporation, and
otherwise shall belong to USA Networks.

SECTION 5.4. Any person purchasing or otherwise acquiring any interest
in shares of the capital stock of the Corporation shall be deemed to have notice
of and to have consented to the provisions of this Article V.

SECTION 5.5. For purposes of this Article V only;

(a) A director of the Corporation who is Chairman of the Board of
Directors of the Corporation or of a committee thereof shall not be deemed
to be an officer of the Corporation by reason of holding such position
(without regard to whether such position is deemed an office of the
Corporation under the Bylaws of the Corporation), unless such person is a
full-time employee of the Corporation; and

(b) The term "Corporation" shall mean the Corporation and all
corporations, partnerships, joint ventures, associations and other entities
in which the Corporation beneficially owns (directly or indirectly) 50% or
more of the outstanding voting stock, voting power, partnership interests
or similar voting interests. The term "USA Networks" shall mean USA
Networks, Inc., a Delaware corporation, USANi LLC, a Delaware limited
liability company, and all corporations, partnerships, joint ventures,
associations and other entities (other than the Corporation, as defined in
accordance with this paragraph) in which USA Networks beneficially owns
(directly or indirectly) 50% or more of the outstanding voting stock,
voting power, partnership interests or similar voting interests.

SECTION 5.6. Anything in this Certificate of Incorporation to the
contrary notwithstanding, (a) the foregoing provisions of this Article V shall
expire on the date that USA Networks ceases to beneficially own Common Stock
representing at least 20% of the total voting power of all classes of
outstanding capital stock of the Corporation entitled to vote in the election of
directors and no person who is a director or officer of the Corporation is also
a director or officer of USA Networks; and (b) in addition to any vote of the
stockholders required by law, until the time that USA Networks ceases to
beneficially own Common Stock representing at least 20% of the total voting
power of all classes of outstanding capital stock of the Corporation entitled to
vote in the election of directors, the affirmative vote of the holders of more
than 80% of the total voting power of all such classes of outstanding capital
stock of the Corporation shall be required to alter, amend or repeal in a manner
adverse to the interests of USA Networks, or adopt any provision adverse to the
interests of USA Networks and inconsistent with, any provision of this Article
V. Neither the alteration, amendment or repeal of this Article V nor the
adoption of any provision of this Certificate of Incorporation inconsistent with
this Article V shall eliminate or reduce the effect of this Article V in respect
of any matter occurring, or any cause of action, suit or claim that, but for
this Article V, would accrue or arise, prior to such alteration, amendment,
repeal or adoption.

VI.

Elections of directors need not be by written ballot except and to the
extent provided in the Bylaws of the Corporation.

VII.

Except as set forth in Article XI of the Bylaws, the Board of Directors is
expressly authorized to make, alter or repeal Bylaws of the Corporation, and the
stockholders may make additional Bylaws and may alter or repeal any Bylaw
whether adopted by them or otherwise.

VIII.

Each person who is or was or had agreed to become a director or officer of
the Corporation, or each such person who is or was serving or who had agreed to
serve at the request of the Board of Directors or an officer of the Corporation
as an employee or agent of the Corporation or as a director, officer, employee
or agent of another corporation, partnership, joint venture, trust or other
enterprise (including the heirs, executors, administrators or estate of such
person), shall be indemnified by the Corporation, in accordance with the Bylaws
of the Corporation, to the full extent permitted from time to time by the
General Corporation Law of the State of Delaware as the same exists or may
hereafter be amended (but, in the case of any such amendment, only to the extent
that such amendment permits the Corporation to provide broader indemnification
rights than said law permitted the Corporation to provide prior to such
amendment) or any other applicable laws as presently or hereinafter in effect.
Without limiting the generality or the effect of the foregoing, the Corporation
may enter into one or more agreements with any person that provide for
indemnification greater or different than that provided in this Article VIII.
Any amendment or repeal of this Article VIII shall not adversely affect any
right or protection existing hereunder immediately prior to such amendment or
repeal.

IX.

A director of the Corporation shall not be personally liable to the
Corporation or its stockholders for monetary damages for breach of fiduciary
duty as a director, except for liability (i) for any breach of the director's
duty of loyalty to the Corporation or its stockholders, (ii) for acts or
omissions not in good faith or which involve intentional misconduct or a knowing
violation of law, (iii) under Section 174 of the General Corporation Law of the
State of Delaware, or (iv) for any transaction from which the director derived
an improper personal benefit. Any amendment or repeal of this Article IX shall
not adversely affect any right or protection of a director of the Corporation
existing immediately prior to such amendment or repeal. The liability of a
director shall be further eliminated or limited to the full extent permitted by
Delaware law, as it may hereafter be amended.

The Corporation reserves the right to amend, alter, change or repeal any
provision contained in this Certificate of Incorporation in the manner now or
hereafter prescribed by the Delaware General Corporation Law, and all rights
conferred upon stockholders herein are granted subject to this reservation.

-5-
<PAGE>

IN WITNESS WHEREOF, CitySearch, Inc. has caused this Restated Certificate
of Incorporation to be signed by its Chief Executive Officer and attested to by
its Secretary this ____ day of _________, 1998.

/s/ Charles Conn III
------------------------------------
Charles Conn, III
Chief Executive Officer

ATTEST: /s/ Bradley O. Ramberg

Bradley O. Ramberg
Secretary

-6-

<PAGE>

EXHIBIT 3.3

AMENDED AND RESTATED

BY-LAWS

OF TICKETMASTER ONLINE-CITYSEARCH, INC.

ARTICLE I

Offices
-------

Section 1. Principal office. The registered office of the Corporation
----------------
shall be located in the City of Wilmington, County of New Castle, State of
Delaware.

Section 2. Other offices. The Corporation may also have offices at
-------------
such other places, both within and without the State of Delaware, as the Board
of Directors may from time to time determine or the business of the Corporation
may require.

ARTICLE II

Stockholders Section
--------------------

Section 1. Place of meeting. Meetings of stockholders may be held at
----------------
such place, either within or without the State of Delaware, as may be designated
by the Board of Directors.

If no designation is made, the place of the meeting shall be the
principal office of the Corporation.

Section 2. Annual meeting. The annual meeting of the stockholders
--------------
shall be held at such date and time as may be fixed by resolution of the Board
of Directors.

Section 3. Special meetings. Special meetings of the stockholders may
----------------
be called by the Chairman of the Board or a majority of the Board of Directors.

Section 4. Notice. Written notice stating the date, time and place of
------
the meeting, and in case of a special meeting, the purpose or purposes thereof,
shall be given to each stockholder entitled to vote thereat not less than ten
(10) nor more than sixty (60) days prior thereto, either personally or by mail,
facsimile or telegraph, addressed to each stockholder at his address as it
appears on the records of the Corporation.

If mailed, such notice shall be deemed to be delivered when deposited
in the United States mail so addressed, with postage thereon prepaid. If notice
be by facsimile, such notice shall be deemed to be delivered when confirmation
of receipt is received by the sender. If
<PAGE>

notice be by telegram, such notice shall be deemed to be delivered when the
telegram is delivered to the telegraph company. Such further notice shall be
given as may be required by law. Meetings may be held without notice if all
stockholders entitled to vote are present, or if notice is waived by those not
present. Any previously scheduled meeting of the stockholders may be postponed,
and (unless the Certificate of Incorporation of the Corporation otherwise
provides) any special meeting of the stockholders may be canceled, by resolution
of the Board of Directors upon public notice given prior to the date previously
scheduled for such meeting of stockholders.

Section 5. Adjourned meetings. The Chairman of the meeting or a
------------------
majority of the voting power of the shares so represented may adjourn the
meeting from time to time, whether or not there is a quorum. When a meeting is
adjourned to another time or place, except as required by law, notice of the
adjourned meeting need not be given if the time and place thereof are announced
at the meeting at which the adjournment is taken, if the adjournment is for not
more than thirty (30) days, and if no new record date is fixed for the adjourned
meeting. At the adjourned meeting the Corporation may transact any business that
might have been transacted at the original meeting.

Section 6. Quorum. The holders of a majority of the voting power of
------
the Corporation entitled to vote thereat, present in person or represented by
proxy, shall constitute a quorum at all meetings of the stockholders for the
transaction of business; provided, however, if the Certificate of Incorporation
of the Corporation or the Delaware General Corporation Law provides that any
matter shall be decided by a vote of a certain class or classes of stock, then
the holders of a majority of the voting power entitled to vote thereon, present
in person or represented by proxy shall constitute a quorum for the transaction
of business on such matter. If, however, such quorum shall not be present or
represented at any meeting of the stockholders, the stockholders entitled to
vote thereat, present in person or represented by proxy, shall have the power to
adjourn the meeting from time to time, without notice other than announcement at
the meeting, until a quorum shall be present or represented. If at such
adjourned meeting, a quorum shall be present or represented, any business may be
transacted that might have been transacted at the meeting as originally
notified. When a quorum is present at any meeting, the affirmative vote of a
majority of the voting power of the shares present in person or represented by
proxy at the meeting and entitled to vote on the matter shall be the act of the
stockholders, unless the question is one upon which by express provision of the
Delaware General Corporation Law or of the Certificate of Incorporation of the
Corporation, a different vote is required, in which case such express provision
shall govern and control the decision of such question.

Section 7. Voting. Each stockholder shall at every meeting of the
------
stockholders be entitled to vote in person or by proxy each share of the class
of capital stock having voting power held by such stockholder.

Section 8. Procedure for election of directors; required vote.
--------------------------------------------------
Election of directors at all meetings of the stockholders at which directors are
to be elected shall be by ballot, and, subject to the rights of the holders of
shares of Common Stock to elect directors under specified circumstances, a
plurality of the votes cast thereat shall elect directors. In connection with
any

2
<PAGE>

election of Directors, nominations for such office shall be made in accordance
with the Certificate of Incorporation of the Corporation.

Section 9. Inspectors of elections; opening and closing the polls. The
------------------------------------------------------
Board of Directors by resolution shall appoint one or more inspectors, which
inspector or inspectors may include individuals who serve the Corporation in
other capacities, including, without limitation, as officers, employees, agents
or representatives, to act at the meetings of stockholders and make a written
report thereof. One or more persons may be designated as alternate inspectors to
replace any inspector who fails to act. If no inspector or alternate has been
appointed to act or is able to act at a meeting of stockholders, the Chairman of
the meeting shall appoint one or more inspectors to act at the meeting. Each
inspector, before discharging the duties of an inspector, shall take and sign an
oath faithfully to execute the duties of inspector with strict impartiality and
according to the best of the inspector's ability. The inspectors shall have the
duties prescribed by law.

The Chairman of the meeting shall fix and announce at the meeting the
date and time of the opening and the closing of the polls for each matter upon
which the stockholders will vote at a meeting.

Section 10. Action without meeting. Any action required or permitted
----------------------
to be taken at any annual or special meeting of stockholders may be taken
without a meeting, without prior notice and without a vote, if a consent in
writing, setting forth the action so taken, is signed by the holders of
outstanding stock having not less than the minimum voting power that would be
necessary to authorize or take such action at a meeting at which all of the
shares entitled to vote thereon were present and voted, provided that prompt
notice of such action shall be given to those stockholders who have not so
consented in writing to such action without a meeting.

ARTICLE III

Directors
---------

Section 1. Number and tenure. The business and affairs of the
-----------------
Corporation shall be managed by the Board of Directors. The Board of Directors
shall consist of twelve (12) members. The number of directors may be changed by
an amendment to this By-Law, duly adopted by the Board of Directors or by the
stockholders, or by a duly adopted amendment to the Certificate of Incorporation
of the Corporation. Each director shall serve for a term of one year from the
date of his election and until his successor is elected. Directors need not be
stockholders.

Section 2. Resignation or removal. Any director may at any time resign
----------------------
by delivering to the Board of Directors his resignation in writing, to take
effect no later than ten days thereafter. Any director or the entire Board of
Directors may at any time be removed effective immediately, with or without
cause, by the vote, either in person or represented by proxy, of a majority of
the voting power of shares of stock issued and outstanding of the class or
classes that elected such director and entitled to vote at a special meeting
held for such purpose or by the

3
<PAGE>

written consent of a majority of the voting power of shares of stock issued and
outstanding of the class or classes that elected such director.

Section 3. Vacancies. Vacancies and newly created directorships
---------
occurring on the Board of Directors shall be filled in accordance with the
Certificate of Incorporation of the Corporation and the Delaware General
Corporation Law. The directors so chosen shall hold office until the next
annual election and until their respective successors are duly elected.

Section 4. Regular meetings. Regular meetings of the Board of
----------------
Directors shall be held at such dates, times and places as may be designated by
the Chairman of the Board, and shall be held at least quarterly.

Section 5. Special meetings. Special meetings of the Board of
----------------
Directors may be called by or at the request of the Chairman of the Board or any
two directors. The person or persons calling a special meeting of the Board of
Directors may fix a place and time within or without the State of Delaware for
holding such meeting.

Section 6. Notice. Notice of any regular meeting or a special meeting
------
shall be given to each director, either orally, by facsimile or by hand
delivery, addressed to each director at his address as it appears on the records
of the Corporation. Notice of any meeting of the Board of Directors shall set
out a detailed agenda of the matters to be discussed, but any subject properly
brought before the meeting may be addressed.

If notice be by facsimile, such notice shall be deemed to be
adequately delivered when the notice is transmitted at least 72 hours before
such meeting. If by telephone or by hand delivery, the notice shall be given at
least 72 hours prior to the time set for the meeting. Neither the business to be
transacted at, nor the purpose of, any regular or special meeting of the Board
of Directors need be specified in the notice of such meeting. A meeting may be
held at any time without notice if all the directors are present or if those not
present waive notice of the meeting in accordance with Article IX of these By-
Laws.

Section 7. Quorum. At all meetings of the Board of Directors, a
------
majority of the total number of directors that includes not less than one City
Director (as such term is defined in the Certificate of Incorporation of the
Corporation) shall constitute a quorum for the transaction of business;
provided, however, that if proper notice is given for such meeting in accordance
with these By-Laws and no City Director is present at such meeting, the
attendance of one City Director shall not be required in order to constitute a
quorum for such meeting, so long as a majority of the Directors are in
attendance. Unless otherwise provided in the Certificate of Incorporation of
the Corporation or these By-Laws, the act of a majority of the directors present
at any meeting at which there is a quorum shall be an act of the Board of
Directors. If a quorum is not present at any meeting of the Board of Directors,
the directors present may adjourn the meeting from time to time, without notice,
until a quorum shall be present. The directors present at a duly organized
meeting may continue to transact business until adjournment, notwithstanding the
withdrawal of enough directors to leave less than a quorum. A director present
at a meeting

4
<PAGE>

shall be counted in determining the presence of a quorum, regardless of whether
a contract or transaction between the Corporation and any other Corporation,
partnership, association, or other reorganization in which such director is a
director or officer or has a financial interest, is authorized or considered at
such meeting.

5
<PAGE>

Section 8. Action without meeting. Any action required or permitted to
----------------------
be taken at any meeting of the Board of Directors or of any committee thereof
may be taken without a meeting if all members of the Board of Directors or such
committee, as the case may be, consent thereto in writing and such written
consent is filed with the minutes of proceedings of the Board of Directors or
committee.

Section 9. Action by conference telephone. Members of the Board of
------------------------------
Directors or any committee thereof may participate in a meeting of such Board of
Directors or committee by means of a conference telephone or similar
communications equipment by means of which all persons participating in the
meeting can hear each other, and such participation in a meeting shall
constitute presence in person at such meeting.

Section 10. Chairman of the Board. The Chairman of the Board shall be
---------------------
chosen from among the Directors. The Chairman of the Board shall preside at all
meetings of the stockholders and of the Board of Directors, except that, in his
absence, he may designate another member of the Board of Directors to so
preside. Unless otherwise provided by resolution of the Board of Directors, the
Chairman of the Board shall not be an officer of the Corporation, The Chairman
of the Board shall perform all duties incidental to his office which may be
required by law and all such other duties as a properly required of him by the
Board of Directors. He shall make reports to the Board of Directors and the
stockholders and, together with the Chief Executive Officer of the Corporation,
shall see that all orders and resolutions of the Board of Directors and any
committee thereof are carried into effect.

Section 11. Committees. The Board of Directors, by resolution adopted
----------
by a majority of the whole Board of Directors, may designate one (1) or more
committees, each committee to consist of two (2) or more directors. The Board of
Directors may designate one (1) or more directors as alternate members of any
committee, who may replace any absent or disqualified member at any meeting of
the committee. In the absence or disqualification of any member of a committee,
the member or members thereof present at any meeting and not disqualified from
voting, whether or not he or they constitute a quorum, may unanimously appoint
another member of the Board of Directors to act at the meeting in the place of
any such absent or disqualified member. Any such committee, to the extent
provided in such resolution, shall have and may exercise all of the powers of
the Board of Directors in the management of the business and affairs of the
Corporation and may authorize the seal of the Corporation to be affixed to all
papers that may require it, except that no committee shall have the power or
authority to amend the Certificate of Incorporation of the Corporation, to adopt
an agreement of merger or consolidation, to recommend to the stockholders the
sale, lease or exchange of all or substantially all of the Corporation's
property and assets, to recommend to the stockholders a dissolution, to amend
the By-Laws of the Corporation, to declare a dividend or to authorize the
issuance of stock.

6
<PAGE>

Section 12. Compensation of directors. The directors may be paid their
-------------------------
expenses, if any, of attendance at each meeting of the Board of Directors and
may be paid a fixed sum for attendance at each meeting of the Board of Directors
or a stated salary as director. No such payment shall preclude any director from
serving the Corporation in any other capacity and receiving compensation
therefor. Members of committees may be allowed like compensation for attending
committee meetings.

ARTICLE IV

Officers
--------

Section 1. Number and salaries. The officers of the Corporation shall
-------------------
consist of a Chief Executive Officer (the "CEO"), a President, a Secretary, a
Treasurer, and such other officers and assistant officers and agents as may be
deemed necessary by the Board of Directors. Any two (2) or more offices may be
held by the same person.

Section 2. Election and term of office. The officers of the
---------------------------
Corporation shall be elected by the Board of Directors at the first meeting of
the Board of Directors following the stockholders' annual meeting, and shall
serve for a term of one (1) year and until a successor is elected by the Board
of Directors. Unless otherwise provided in the Certificate of Incorporation of
the Corporation or these By-Laws, any officer appointed by the Board of
Directors may be removed, with or without cause, at any time by the CEO or by
the Board of Directors. Each officer shall hold his office until his successor
is appointed or until his earlier resignation, removal from office, or death.
All officers elected by the Board of Directors shall each have such powers and
duties as generally pertain to their respective offices, subject to the specific
provisions of this Article IV.

Such officers shall also have such powers and duties as from time to
time may be conferred by the Board of Directors or by any committee thereof. The
Board or any committee thereof may from time to time elect, or the CEO may
appoint, such other officers (including a President, one or more Vice
Presidents, Assistant Secretaries, Assistant Treasurers, and Assistant
Controllers) and such agents, as may be necessary or desirable for the conduct
of the business of the Corporation. Such other officers and agents shall have
such duties and shall hold their offices for such terms as shall be provided in
these By-Laws or as may be prescribed by the Board or such committee or by the
CEO, as the case may be.

Section 3. The chief executive officer. The CEO shall be responsible
---------------------------
for the general management of the affairs of the Corporation and shall perform
all duties incidental to his office. The CEO shall be empowered to sign all
certificates, contracts and other instruments of the Corporation, and to do all
acts that are authorized by the Board of Directors, and shall, in general,

7
<PAGE>

have such other duties and responsibilities as are assigned consistent with the
authority of a Chief Executive Officer and Chairman of the Board of a
corporation.

Section 4. The president. The Board of Directors or the CEO may elect
-------------
a President to have such duties and responsibilities as from time to time may be
assigned to him by the CEO or the Board of Directors. The President shall be
empowered to sign all certificates, contracts and other instruments of the
Corporation, and to do all acts which are authorized by the CEO or the Board of
Directors, and shall, in general, have such other duties and responsibilities as
are assigned consistent with the authority of a President of a corporation.

Section 5. Vice presidents. The Board of Directors or the CEO may from
---------------
time to time name one or more Vice Presidents that may include the designation
of Executive Vice Presidents and Senior Vice Presidents all of whom shall
perform such duties as from time to time may be assigned to him by the CEO or
the Board of Directors.

Section 6. The secretary. The Secretary shall keep the minutes of the
-------------
proceedings of the stockholders and the Board of Directors; the Secretary shall
give, or cause to be given, all notices in accordance with the provisions of
these By-Laws or as required by law, shall be custodian of the corporate records
and of the seal of the Corporation, and, in general, shall perform such other
duties as may from time to time be assigned by the CEO or the Board of
Directors.

Section 7. Treasurer. The Treasurer or, if one is designated by the
---------
Board of Directors, the Chief Financial Officer of the Corporation, shall act as
the chief financial officer of the Corporation, shall have the custody of the
corporate funds and securities, shall keep, or cause to be kept, correct and
complete books and records of account, including full and accurate accounts of
receipts and disbursements in books belonging to the Corporation, shall deposit
all monies and other valuable effects in the name and to the credit of the
Corporation in such depositories as may be designated by the Board of Directors,
and in general shall perform all duties incident to the office of Treasurer and
such other duties as from time to time may be assigned to him by the CEO or the
Board of Directors.

Section 8. Assistant secretaries. The Assistant Secretaries, if any,
---------------------
in general shall perform such duties as from time to time may be assigned to
them by the Secretary or by the Board of Directors, and shall in the absence or
incapacity of the Secretary, perform his functions.

Section 9. Assistant treasurers. The Assistant Treasurers, if any, in
--------------------
general shall perform such duties as from time to time may be assigned to them
by the Treasurer or by the Board of Directors, and shall in the absence or
incapacity of the Treasurer perform his functions.

8
<PAGE>

ARTICLE V

Certificates of Stock
---------------------

Section 1. Signature by officers. Every holder of stock in the
---------------------
Corporation shall be entitled to have a certificate signed by or in the name of
the Corporation by the CEO, the Chairman or President, if any (or any Vice
President), and the Secretary (or an Assistant Secretary) of the Corporation,
certifying the number of shares owned by the stockholder in the Corporation.

Section 2. Facsimile signatures. The signature of the CEO, Chairman,
--------------------
President, Vice President, Treasurer or Assistant Treasurer, Secretary or
Assistant Secretary may be a facsimile. In case any officer or officers who have
signed, or whose facsimile signature or signatures have been used on any such
certificate or certificates shall cease to be such officer or officers of the
Corporation, whether because of death, resignation or otherwise, before such
certificate or certificates have been delivered by the Corporation, such
certificate or certificates may nevertheless be adopted by the Corporation and
be issued and delivered as though the person or persons who signed such
certificate or certificates or whose facsimile signature or signatures have been
used thereon had not ceased to be such officer or officers of the Corporation.

Section 3. Lost certificates. The Board of Directors may direct a new
-----------------
certificate(s) to be issued by the Corporation to replace any certificate(s)
alleged to have been lost or destroyed, upon its receipt of an affidavit of that
fact by the person claiming the certificate(s) of stock to be lost or destroyed.
When authorizing such issue of a new certificate(s), the Board of Directors may,
in its discretion and as a condition precedent to the issuance thereof, require
the owner of such lost or destroyed certificate(s), or such owner's legal
representative, to advertise the same in such manner as it shall require and/or
to give the Corporation a bond in such sum as it may direct as indemnity against
any claim that may be made against the Corporation with respect to the
certificate(s) alleged to have been lost or destroyed.

Section 4. Transfer of stock. Upon surrender to the Corporation or its
-----------------
transfer agent of a certificate for shares duly endorsed or accompanied by
proper evidence of succession, assignment or authority to transfer, the
Corporation shall issue a new certificate to the person entitled thereto, cancel
the old certificate and record the transaction upon its books.

Section 5. Closing of transfer books or fixing of record date. The
--------------------------------------------------
Board of Directors may close the stock transfer books of the Corporation for a
period of not more than sixty (60) nor less than ten (10) days preceding the
date of any meeting of stockholders, or the date for payment of any dividend, or
the date for the allotment of rights, or the date when any change or conversion
or exchange of capital stock shall go into effect or for a period of not more
than sixty (60) nor less than ten (10) days in connection with obtaining the
consent of stockholders for any purpose. In lieu of closing the stock transfer
books, the Board of Directors may fix in advance a date of not more than sixty
(60) nor less than ten (10) days preceding the date of any dividend, or the date
for the allotment of rights, or the date when any change or

9
<PAGE>

conversion or exchange of capital stock shall go into effect, or a date in
connection with obtaining such consent, as a record date for the determination
of the stockholders entitled to notice of, and to vote at, any such meeting, and
any adjournment thereof, or entitled to receive payment of any such dividend, or
to any such allotment of rights, or to exercise the rights in respect of any
change, conversion or exchange of capital stock, or to give such consent. In
such case and not- withstanding any transfer of any stock on the books of the
Corporation after any such record date, such stockholders as shall be
stockholders of record on the date so fixed shall be entitled to such notice of,
and to vote at, such meeting and any adjournment thereof, or to receive payment
of such dividend, or to receive such allotment of rights, or to exercise such
rights, or to give such consent, as the case may be.

Section 6. Registered stockholders. The Corporation shall be entitled
-----------------------
to recognize the exclusive right of a person registered on its books as the
owner of shares to receive dividends and to vote as such owner. Except as
otherwise provided by law, the Corporation shall not be bound to recognize any
equitable or other claim to or interest in such shares on the part of any other
person whether or not it shall have express or other notice thereof.

ARTICLE VI

Contract, Loans, Checks, and Deposits
-------------------------------------

Section 1. Contracts. When the execution of any contract or other
---------
instrument has been authorized by the Board of Directors without specification
of the executing officers, the CEO, the President, any Vice President, the
Treasurer or Assistant Treasurer and the Secretary, or any Assistant Secretary,
may execute the same in the name of and on behalf of the Corporation and may
affix the corporate seal thereto.

Section 2. Loans. No loans shall be contracted on behalf of the
-----
Corporation and no evidence of indebtedness shall be issued in its name unless
authorized by a resolution of the Board of Directors.

Section 3. Checks. All checks or demands for money and notes of the
------
Corporation shall be signed by such officer or officers or such other person or
persons as the Board of Directors may from time to time designate.

Section 4. Accounts. Bank accounts of the Corporation shall be opened,
--------
and deposits made thereto, by such officers or other persons as the Board of
Directors may from time to time designate.

10
<PAGE>

ARTICLE VII

Dividends
---------

Section 1. Declaration of dividends. Subject to the provisions, if
------------------------
any, of the Certificate of Incorporation of the Corporation, dividends upon the
capital stock of the Corporation may be declared by the Board of Directors at
any regular or special meeting, pursuant to law. Dividends may be paid in cash,
in property or contractual rights, or in shares of the Corporation's capital
stock.

Section 2. Reserves. Before payment of any dividend, there may be set
--------
aside out of any funds of the Corporation available for dividends such sum or
sums as the Board of Directors from time to time, in their absolute discretion,
think proper as a reserve or reserves to meet contingencies or for equalizing
dividends, or for repairing or maintaining any property of the Corporation, or
for such other purpose as the Board of Directors shall think conducive to the
interests of the Corporation, and the Board of Directors may modify or abolish
any such reserve in the manner in which it was created.

ARTICLE VIII

Fiscal Year
-----------

The fiscal year of the Corporation shall be established by the Board
of Directors.

ARTICLE IX

Waiver of Notice
----------------

Whenever any notice whatever is required to be given by law, the
Certificate of Incorporation of the Corporation or these By-Laws, a written
waiver thereof, signed by the person or persons entitled to such notice, whether
before or after the time stated therein, shall be deemed equivalent to the
giving of such notice.

Attendance of a person at a meeting shall constitute a waiver of
notice of such meeting.

ARTICLE X

Seal
----

The corporate seal shall have inscribed thereon the name of the
Corporation, the year of its organization, and the words "Corporate Seal,
Delaware". The seal may be used by causing it or a facsimile thereof to be
impressed or affixed or otherwise reproduced.

11
<PAGE>

ARTICLE XI

Amendments
----------

Except as expressly provided otherwise by the Delaware General
Corporation Law, the Certificate of Incorporation of the Corporation, or other
provisions of these By-Laws, these By-Laws may be altered, amended or repealed
and new By-Laws adopted at any regular or special meeting of the Board of
Directors by an affirmative vote of a majority of all directors.

ARTICLE XII

Indemnification and Insurance
-----------------------------

Section 1. Indemnification. The Corporation shall, to the fullest
---------------
extent authorized by the General Corporation Law of the State of Delaware as the
same exists or may hereafter be amended (but, in the case of any such amendment,
only to the extent that such amendment permits the Corporation to provide
broader indemnification rights than said law permitted the Corporation to
provide prior to such amendment), indemnify and hold harmless any person who was
or is a party or is threatened to be made a party to any threatened, pending or
completed action, suit, investigation or proceeding, whether civil, criminal or
administrative by reason of the fact that he or a person of whom he is the legal
representative is or was a director or officer of the Corporation, or is or was
a director or officer of the Corporation serving at the request of the
Corporation as a director, officer or employee of another Corporation,
partnership, joint venture, trust, employee benefit plan or other enterprise
(whether the basis of such proceeding is alleged action in an official capacity
as a director or officer or in any other capacity while serving as a director or
officer) against all expenses, liability and loss (including attorneys' fees,
judgments, fines, ERISA excise taxes or penalties and amounts paid or to be paid
in settlement) reasonably incurred or suffered by him in connection therewith;
provided, however, that except as provided in this By-Law, the Corporation shall
indemnify any such person seeking indemnification in connection with a
proceeding (or part thereof) initiated by such person only if such proceeding
(or part thereof) was authorized by the Board of Directors. The right to
indemnification conferred in this By-Law shall be a contract right and shall
include the right to be paid by the Corporation the expenses incurred in
defending any such proceeding in advance of its final disposition, such advances
to be paid by the Corporation within 20 days after the receipt by the
Corporation of a statement or statements from the claimant requesting such
advance or advances from time to time; provided, however, that if the General
Corporation Law of the State of Delaware requires, the payment of such expenses
incurred by a director or officer in his capacity as a director or officer (and
not in any other capacity in which service was or is rendered by such person
while a director or officer, including, without limitation, service to an
employee benefit plan) in advance of the final disposition of a proceeding,
shall be made only upon delivery to the Corporation of an undertaking by or on
behalf of such director or officer, to repay all amounts so advanced if it shall
ultimately be determined that such director or officer is not entitled to be
indemnified under this By-Law or otherwise.

12
<PAGE>

To obtain indemnification under this By-Law, a claimant shall submit
to the Corporation a written request, including therein or therewith such
documentation and information as is reasonably available to the claimant and is
reasonably necessary to determine whether and to what extent the claimant is
entitled to indemnification. Any indemnification (unless ordered by a court)
shall be made by the Corporation only as authorized in the specific case upon a
determination that indemnification of the director or officer is proper in the
circumstances because he has met the applicable standard of conduct. Upon
written request by a claimant for indemnification pursuant to the preceding
sentence, a determination, if required by applicable law, with respect to a
claimant's entitlement thereto shall be made as follows: (i) by the Board of
Directors by a majority vote of a quorum consisting of directors who were not
parties to such action, suit, investigation or proceeding, or (ii) if such a
quorum is not obtainable, or, even if obtainable, a quorum of disinterested
directors so directs, by independent legal counsel in a written opinion, or
(iii) by the stockholders of the Corporation. If it is so determined that the
claimant is entitled to indemnification, payment to the claimant shall be made
within 10 days after such determination.

If a claim under this By-Law is not paid in full by the Corporation
within 20 days after a written claim pursuant to this By-Law has been received
by the Corporation, the claimant may at any time thereafter bring suit against
the Corporation to recover the unpaid amount of the claim and, if successful in
whole or in part, the claimant shall be entitled to be paid also the expense of
prosecuting such claim. It shall be a defense to any such action (other than an
action brought to enforce a claim for expenses incurred in defending any
proceeding in advance of its final disposition where the required undertaking,
if any is required, has been tendered to the Corporation) that the claimant has
not met the standard of conduct which makes it permissible under the General
Corporation Law of the State of Delaware for the Corporation to indemnify the
claimant for the amount claimed, but the burden of proving such defense shall be
on the Corporation. Neither the failure of the Corporation (including its Board
of Directors or stockholders) to have made a determination prior to the
commencement of such action that indemnification of the claimant is proper in
the circumstances because he has met the applicable standard of conduct set
forth in the General Corporation Law of the State of Delaware, nor an actual
determination by the Corporation (including its Board of Directors or
stockholders) that the claimant has not met such applicable standard of conduct,
shall be a defense to the action or create a presumption that the claimant has
not met the applicable standard of conduct.

If a determination shall have been made pursuant to this By-Law that
the claimant is entitled to indemnification, the Corporation shall be bound by
such determination in any judicial proceeding commenced pursuant to this By-Law.

Furthermore, the Corporation shall be precluded from asserting in any
judicial proceeding commenced pursuant to this By-Law that the procedures and
presumptions of this By-Law are not valid, binding and enforceable and shall
stipulate in such proceeding that the Corporation is bound by all the provisions
of this By-Law.

13
<PAGE>

The right to indemnification and the payment of expenses incurred in
defending a proceeding in advance of its final disposition conferred in this By-
Law shall not be exclusive of any other rights to which those seeking
indemnification or advancement of expenses may be entitled under any By-Law,
agreement, contract, vote of stockholders or disinterested directors or pursuant
to the direction (howsoever embodied) of any court of competent jurisdiction or
otherwise, both as to action in his official capacity and as to action in
another capacity while holding such office, it being the policy of the
Corporation that indemnification shall be made to the fullest extent permitted
by law. No repeal or modification of this By-Law shall in any way diminish or
adversely affect the rights of any director or officer of the Corporation (or
employee or agent of the Corporation to which rights to indemnification have
been granted) hereunder in respect of any occurrence or matter arising prior to
any such repeal or modification.

The indemnification and advancement of expenses shall, unless
otherwise provided when authorized or ratified, continue as to a person who has
ceased to be a director, officer, employee or agent and shall inure to the
benefit of the heirs, executors and administrators of such a person.

The Corporation may, to the extent authorized from time to time by the
Board of Directors, grant rights to indemnification, and rights to be paid by
the Corporation the expenses incurred in defending any proceeding in advance of
its final disposition, to any employee or agent of the Corporation to the
fullest extent of the provisions of this By-Law with respect to the
indemnification and advancement of expenses of directors and officers of the
Corporation.

If any provision or provisions of this By-Law shall be held to be
invalid, illegal or unenforceable for any reason whatsoever: (1) the validity,
legality and enforceability of the remaining provisions of this By-Law
(including, without limitation, each portion of any paragraph of this By-Law
containing any such provision held to be invalid, illegal or unenforceable, that
is not itself held to be invalid, illegal or unenforceable) shall not in any way
be affected or impaired thereby; and (2) to the fullest extent possible, the
provisions of this By-Law (including, without limitation, each such portion of
any paragraph of this By-Law containing any such provision held to be invalid,
illegal or unenforceable) shall be construed so as to give effect to the intent
manifested by the provision held invalid, illegal or unenforceable.

Any notice, request or other communication required or permitted to be
given to the Corporation under this By-Law shall be in writing and either
delivered in person or sent by telecopy, telex, telegram, overnight mail or
courier service, or certified or registered mail, postage prepaid, return
receipt requested, to the Secretary of the Corporation and shall be effective
only upon receipt by the Secretary.

Section 2. Insurance. The Corporation may purchase and maintain
---------
insurance on behalf of any person who is or will be a director, officer,
employee or agent of the Corporation, or is or will be a director or officer of
the Corporation serving at the request of the Corporation as a director,
officer, employee or agent of another Corporation, partnership, joint venture,
trust, employee benefit plan or other enterprise against any expense, liability
or loss, whether or not the

14
<PAGE>

Corporation would have the power to indemnify such person against such expense,
liability or loss under the General Corporation Law of the State of Delaware. To
the extent that the Corporation maintains any policy or policies providing such
insurance, each such director or officer, and each such agent or employee to
which rights to indemnification have been granted, shall be covered by such
policy or policies in accordance with its or their terms to the maximum extent
of the coverage thereunder for any such director, officer, employee or agent.

<PAGE>

EXHIBIT 4.1
- --------------------------------------------------------------------------------

-------------- --------------
NUMBER [TICKETMASTER ONLINE LOGO] SHARES

-------------- --------------

CLASS B CLASS B
COMMON STOCK [CITYSEARCH LOGO] COMMON STOCK

INCORPORATED UNDER THE LAWS SEE REVERSE FOR
OF THE STATE OF DELAWARE CERTAIN DEFINITIONS

TICKETMASTER ONLINE-CITYSEARCH, INC. CUSIP 88633P 20 3

This Certifies that

is the record holder of

FULLY PAID AND NONASSESSABLE SHARES OF CLASS B COMMON STOCK $.01 PAR VALUE PER
SHARE, OF

TICKETMASTER ONLINE-CITYSEARCH, INC.

transferable on the books of the Corporation in person or by duly
authorized attorney on surrender of this certificate properly endorsed.
This certificate shall not be valid until countersigned and registered by
the Transfer Agent and Registrar.

WITNESS the facsimile seal of the Corporation and the signatures of its
duly authorized officers.

Dated:

/s/ Bradly Rambey SEAL /s/ Thomas Layton
[APPEARS HERE]
SECRETARY PRESIDENT

COUNTERSIGNED AND REGISTERED:
CHASEMELLON SHAREHOLDER SERVICES, L.L.C.
TRANSFER AGENT AND REGISTRAR

AUTHORIZED SIGNATURE

- --------------------------------------------------------------------------------
<PAGE>

The Corporation will furnish without charge to each stockholder who so requests
the powers, designations, preferences and relative, participating, optional, or
other special rights of each class of stock or series thereof and the
qualifications, limitations or restrictions of such preferences and/or rights.
Such requests shall be made to the Corporation's Secretary at the principal
office of the Corporation.

KEEP THIS CERTIFICATE IN A SAFE PLACE. IF IT IS LOST, STOLEN, OR
DESTROYED THE CORPORATION WILL REQUIRE A BOND OF INDEMNITY AS A CONDITION TO THE
ISSUANCE OF A REPLACEMENT CERTIFICATE.

The following abbreviations, when used in the inscription on the face of
this certificate, shall be construed as though they were written out in full
according to applicable laws or regulations:

<TABLE>
<S> <C>
TEN COM -- as tenants in common UNIF GIFT MIN ACT -- ..............Custodian.................
TEN ENT -- as tenants by the entireties (Cust) (Minor)
JT TEN -- as joint tenants with right of under Uniform Gifts to Minors
survivorship and not as tenants Act....................................
in common (State)
UNIF TRF MIN ACT -- ..........Custodian (Until age............)
(Cust)
..................under Uniform Transfers
(Minor)
to Minors Act............................
(State)
</TABLE>

Additional abbreviations may also be used though not in the above list.

FOR VALUE RECEIVED,____________________hereby sell, assign and transfer unto

PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE
_______________________________________

_______________________________________

________________________________________________________________________________
(PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING ZIP CODE, OF ASSIGNEE)

________________________________________________________________________________

__________________________________________________________________________Shares
of the common stock represented by the within Certificate, and do hereby
irrevocably constitute and appoint

_______________________________________________________________________Attorney
to transfer the said stock on the books of the within named Corporation with
full power of substitution in the premises.

Dated____________________________

X_______________________________________

THE SIGNATURE(S) TO THIS ASSIGNMENT MUST
CORRESPOND WITH THE NAMES(S) AS WRITTEN
NOTICE: UPON THE FACE OF THE CERTIFICATE IN EVERY
PARTICULAR, WITHOUT ALTERATION OR
ENLARGEMENT OR ANY CHANGE WHATEVER.

Signature(s) Guaranteed

By_______________________________________________
THE SIGNATURES(S) MUST BE GUARANTEED BY AN ELIGIBLE GUARANTOR INSTITUTION
(BANKS, STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH
MEMBERSHIP IN AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM), PURSUANT TO
S.E.C. RULE 17Ad-15.

<PAGE>

EXHIBIT 5.1
-----------
[WILSON SONSINI LETTERHEAD]

November 6, 1998

Ticketmaster Online-CitySearch, Inc.
790 East Colorado Boulevard, Suite 200
Pasadena, CA 91101

RE: REGISTRATION STATEMENT ON FORM S-1
----------------------------------

Ladies and Gentlemen:

We have examined the Registration Statement on Form S-1, as amended, filed
by Ticketmaster Online-CitySearch, Inc., a Delaware corporation (the "Company"),
with the Securities and Exchange Commission in connection with the registration
under the Securities Act of 1933, as amended, of up to 8,050,000 shares of the
Company's Common Stock (including an over-allotment of up to 1,050,000 shares of
the Company's Common Stock granted to the underwriters) (the "Shares"). The
Shares are to be sold to the underwriters for resale to the public as described
in the Registration Statement and pursuant to the Underwriting Agreement filed
as an exhibit thereto. As legal counsel to the Company, we have examined the
proceedings proposed to be taken in connection with said sale and issuance of
the Shares.

Based upon the foregoing, we are of the opinion that the Shares, when
issued in the manner described in the Registration Statement, will be duly
authorized, validly issued, fully paid and nonassessable.

We consent to the use of this opinion as an exhibit to the Registration
Statement, and further consent to the use of our name wherever appearing in the
Registration Statement, including the Prospectus constituting a part thereof,
and any amendment thereto.

Very truly yours,

/s/ WILSON SONSINI GOODRICH & ROSATI, P.C.
WILSON SONSINI GOODRICH & ROSATI
Professional Corporation

<PAGE>

EXHIBIT 10.2

TICKETMASTER ONLINE-CITYSEARCH, INC.

1996 STOCK OPTION PLAN
(As Amended Effective [Date])

1. Purposes of the Plan. The purposes of this Stock Option Plan are to
--------------------
attract and retain the best available personnel for positions of substantial
responsibility, to provide additional incentive to Employees and Consultants of
the Company and its Subsidiaries and to promote the success of the Company's
business. Options granted under the Plan may be incentive stock options (as
defined under Section 422 of the Code) or nonstatutory stock options, as
determined by the Administrator at the time of grant of an option and subject to
the applicable provisions of Section 422 of the Code, as amended, and the
regulations promulgated thereunder.

2. Definitions. As used herein, the following definitions shall apply:
-----------

(a) "Administrator" means the Board or any of its Committees appointed
-------------
pursuant to Section 4 of the Plan.

(b) "Applicable Laws" means the requirements relating to the
---------------
administration of stock option plans under U. S. state corporate laws, U.S.
federal and state securities laws, the Code, any stock exchange or quotation
system on which the Common Stock is listed or quoted and the applicable laws of
any foreign country or jurisdiction where Options are, or will be, granted under
the Plan.

(d) "Code" means the Internal Revenue Code of 1986, as amended.
----

(e) "Committee" means a Committee appointed by the Board of Directors
---------
in accordance with Section 4 of the Plan.

(f) "Common Stock" means the Class A Common Stock of the Company.
------------

(g) "Company" means Ticketmaster Online-CitySearch, Inc., a Delaware
-------
corporation.

(h) "Consultant" means any person who is engaged by the Company or any
----------
Parent or Subsidiary to render consulting or advisory services and is
compensated for such services, and any director of the Company whether
compensated for such services or not.

(i) "Continuous Status as an Employee or Consultant" means that the
----------------------------------------------
employment or consulting relationship with the Company, any Parent, or
Subsidiary, is not interrupted or terminated. Continuous Status as an Employee
or Consultant shall not be considered interrupted in the case of (i) any leave
of absence approved by the Company or (ii) transfers between locations of

<PAGE>

the Company or between the Company, its Parent, any Subsidiary, or any
successor. A leave of absence approved by the Company shall include sick leave,
military leave, or any other personal leave approved by an authorized
representative of the Company. For purposes of Incentive Stock Options, no such
leave may exceed 90 days, unless reemployment upon expiration of such leave is
guaranteed by statute or contract, including Company policies. If reemployment
upon expiration of a leave of absence approved by the Company is not so
guaranteed, on the 181st day of such leave any Incentive Stock Option held by
the Optionee shall cease to be treated as an Incentive Stock Option and shall be
treated for tax purposes as a Nonstatutory Stock Option.

(j) "Employee" means any person, including Officers and directors,
--------
employed by the Company or any Parent or Subsidiary of the Company. The payment
of a director's fee by the Company shall not be sufficient to constitute
"employment" by the Company.

(k) "Exchange Act" means the Securities Exchange Act of 1934, as
------------
amended.

(l) "Fair Market Value" means, as of any date, the value of Common
-----------------
Stock determined as follows:

(i) If the Common Stock is listed on any established stock
exchange or a national market system, including without limitation the Nasdaq
National Market or The Nasdaq SmallCap Market of The Nasdaq Stock Market, its
Fair Market Value shall be the closing sales price for such stock (or the
closing bid, if no sales were reported) as quoted on such exchange or system for
the last market trading day prior to the day of determination, as reported in
The Wall Street Journal or such other source as the Administrator deems
reliable;

(ii) If the Common Stock is regularly quoted by a recognized
securities dealer but selling prices are not reported, its Fair Market Value
shall be the mean between the high bid and low asked prices for the Common Stock
on the last market trading day prior to the day of determination, or;

(iii) In the absence of an established market for the Common
Stock, the Fair Market Value thereof shall be determined in good faith by the
Administrator.

(m) "Incentive Stock Option" means an Option intended to qualify as
----------------------
an incentive stock option within the meaning of Section 422 of the Code.

(n) "Nonstatutory Stock Option" means an Option not intended to
-------------------------
qualify as an Incentive Stock Option.

(o) "Officer" means a person who is an officer of the Company within
-------
the meaning of Section 16 of the Exchange Act and the rules and regulations
promulgated thereunder.

(p) "Option" means a stock option granted pursuant to the Plan.
------

-2-
<PAGE>

(q) "Optioned Stock" means the Common Stock subject to an Option.
--------------

(r) "Optionee" means an Employee or Consultant who receives an Option.
--------

(s) "Parent" means a "parent corporation", whether now or hereafter
------
existing, as defined in Section 424(e) of the Code.

(t) "Plan" means this 1996 Stock Option Plan.
----

(u) "Section 16(b)" means Section 16(b) of the Securities Exchange Act
-------------
of 1934, as amended.

(v) "Share" means a share of the Common Stock, as adjusted in
-----
accordance with Section 11 below.

(w) "Subsidiary" means a "subsidiary corporation", whether now or
----------
hereafter existing, as defined in Section 424(f) of the Code.

3. Stock Subject to the Plan. Subject to the provisions of Section 11 of
-------------------------
the Plan, the maximum aggregate number of Shares which may be optioned and sold
under the Plan is 5,500,000 Shares. The Shares may be authorized, but unissued,
or reacquired Common Stock.

If an Option expires or becomes unexercisable without having been
exercised in full, or is surrendered pursuant to an option exchange program, the
unpurchased Shares which were subject thereto shall become available for future
grant or sale under the Plan (unless the Plan has terminated); provided,
--------
however, that Shares that have actually been issued under the Plan shall not be
returned to the Plan and shall not become available for future distribution
under the Plan, except that if unvested Shares are repurchased by the Company at
their original purchase price, and the original purchaser of such Shares did not
receive any benefits of ownership of such Shares, such Shares shall become
available for future grant under the Plan. For purposes of the preceding
sentence, voting rights shall not be considered a benefit of Share ownership.

4. Administration of the Plan.
--------------------------

(a) Procedure.
---------

(i) Multiple Administrative Bodies. The Plan may be
------------------------------
administered by different Committees with respect to different groups of Service
Providers.

(ii) Section 162(m). To the extent that the Administrator
--------------
determines it to be desirable to qualify Options granted hereunder as
"performance-based compensation" within the

-3-
<PAGE>

meaning of Section 162(m) of the Code, the Plan shall be administered by a
Committee of two or more "outside directors" within the meaning of Section
162(m) of the Code.

(iii) Rule 16b-3. To the extent desirable to qualify
----------
transactions hereunder as exempt under Rule 16b-3, the transactions contemplated
hereunder shall be structured to satisfy the requirements for exemption under
Rule 16b-3.

(iv) Other Administration. Other than as provided above, the
--------------------
Plan shall be administered by (A) the Board or (B) a Committee, which committee
shall be constituted to satisfy Applicable Laws.

(b) Powers of the Administrator. Subject to the provisions of the
---------------------------
Plan and, in the case of a Committee, the specific duties delegated by the Board
to such Committee, and subject to the approval of any relevant authorities,
including the approval, if required, of any stock exchange upon which the Common
Stock is listed, the Administrator shall have the authority, in its discretion:

(i) to determine the Fair Market Value of the Common Stock, in
accordance with Section 2 of the Plan;

(ii) to select the Employees and Consultants to whom Options
may from time to time be granted hereunder;

(iii) to determine whether and to what extent Options are
granted hereunder;

(iv) to determine the number of shares of Common Stock to be
covered by each such award granted hereunder;

(v) to approve forms of agreement for use under the Plan;

(vi) to determine the terms and conditions of any award
granted hereunder;

(vii) to determine whether and under what circumstances an
Option may be settled in cash under subsection 9(e) instead of Common Stock;

(viii) to allow Optionees to satisfy withholding tax obligations
by electing to have the Company withhold from the Shares to be issued upon
exercise of an Option that number of Shares having a Fair Market Value equal to
the amount required to be withheld. The Fair Market Value of the Shares to be
withheld shall be determined on the date that the amount of tax to be withheld
is to be determined. All elections by an Optionee to have Shares withheld for
this purpose shall be made in such form and under such conditions as the
Administrator may deem necessary or advisable;

-4-
<PAGE>

(ix) to reduce the exercise price of any Option to the then
current Fair Market Value if the Fair Market Value of the Common Stock covered
by such Option has declined since the date the Option was granted; and

(ix) to construe and interpret the terms of the Plan and awards
granted pursuant to the Plan.

(c) Effect of Administrator's Decision. All decisions, determinations
----------------------------------
and interpretations of the Administrator shall be final and binding on all
Optionees and any other holders of any Options.

5. Eligibility.
-----------

(a) Nonstatutory Stock Options may be granted to Employees and
Consultants. Incentive Stock Options may be granted only to Employees. An
Employee or Consultant who has been granted an Option may, if otherwise
eligible, be granted additional Options.

6. Limitations.
-----------

(a) Each Option shall be designated in the Option Agreement as either
an Incentive Stock Option or a Nonstatutory Stock Option. However,
notwithstanding such designation, to the extent that the aggregate Fair Market
Value of the Shares with respect to which Incentive Stock Options are
exercisable for the first time by the Optionee during any calendar year (under
all plans of the Company and any Parent or Subsidiary) exceeds $100,000, such
Options shall be treated as Nonstatutory Stock Options. For purposes of this
Section 6(a), Incentive Stock Options shall be taken into account in the order
in which they were granted. The Fair Market Value of the Shares shall be
determined as of the time the Option with respect to such Shares is granted.

(b) Neither the Plan nor any Option shall confer upon an Optionee any
right with respect to continuing the Optionee's relationship as a Service
Provider with the Company, nor shall they interfere in any way with the
Optionee's right or the Company's right to terminate such relationship at any
time, with or without cause.

(i) No Employee or Consultant shall be granted, in any fiscal
year of the Company, Options to purchase more than 750,000 Shares.

(ii) In connection with his or her initial service, an Employee
or Consultant may be granted Options to purchase up to an additional 1,500,000
Shares which shall not count against the limit set forth in subsection (i)
above.

-5-
<PAGE>

(iii) The foregoing limitations shall be adjusted proportionately
in connection with any change in the Company's capitalization as described in
Section 12.

(iv) If an Option is cancelled in the same fiscal year of
the Company in which it was granted (other than in connection with a transaction
described in Section 12), the cancelled Option will be counted against the
limits set forth in subsections (i) and (ii) above. For this purpose, if the
exercise price of an Option is reduced, the transaction will be treated as a
cancellation of the Option and the grant of a new Option.

7. Term of Plan. The Plan shall become effective upon the earlier to
------------
occur of its adoption by the Board of Directors or its approval by the
stockholders of the Company, as described in Section 18 of the Plan. It shall
continue in effect for a term of ten (10) years unless sooner terminated under
Section 14 of the Plan.

8. Term of Option. The term of each Option shall be the term stated in
--------------
the Option Agreement; provided, however, that the term shall be no more than ten
(10) years from the date of grant thereof. However, in the case of an Incentive
Stock Option granted to an Optionee who, at the time the Option is granted, owns
stock representing more than ten percent (10%) of the voting power of all
classes of stock of the Company or any Parent or Subsidiary, the term of the
Option shall be five (5) years from the date of grant thereof or such shorter
term as may be provided in the Option Agreement.

9. Option Exercise Price and Consideration.
---------------------------------------

(a) The per share exercise price for the Shares to be issued pursuant
to exercise of an Option shall be such price as is determined by the
Administrator, but shall be subject to the following:

(i) In the case of an Incentive Stock Option

(A) granted to an Employee who, at the time of the grant of
such Incentive Stock Option, owns stock representing more than ten percent (10%)
of the voting power of all classes of stock of the Company or any Parent or
Subsidiary, the per Share exercise price shall be no less than 110% of the Fair
Market Value per Share on the date of grant.

(B) granted to any Employee other than an Employee described
in the preceding paragraph, the per Share exercise price shall be no less than
100% of the Fair Market Value per Share on the date of grant.

(ii) In the case of a Nonstatutory Stock Option, the per Share
exercise price shall be determined by the Administrator. In the case of a
Nonstatutory Stock Option intended to qualify as "performance-based
compensation" within the meaning of Section 162(m) of the Code,

-6-
<PAGE>

the per Share exercise price shall be no less than 100% of the Fair Market Value
per Share on the date of grant.

(iii) Notwithstanding the foregoing, Options may be granted with
a per Share exercise price of less than 100% of the Fair Market Value per Share
on the date of grant pursuant to a merger or other corporate transaction.

(b) The consideration to be paid for the Shares to be issued upon
exercise of an Option, including the method of payment, shall be determined by
the Administrator (and, in the case of an Incentive Stock Option, shall be
determined at the time of grant) and may consist entirely of (1) cash, (2)
check, (3) promissory note, (4) other Shares which (x) in the case of Shares
acquired upon exercise of an Option have been owned by the Optionee for more
than six months on the date of surrender and (y) have a Fair Market Value on the
date of surrender equal to the aggregate exercise price of the Shares as to
which said Option shall be exercised, (5) delivery of a properly executed
exercise notice together with such other documentation as the Administrator and
the broker, if applicable, shall require to effect an exercise of the Option and
delivery to the Company of the sale or loan proceeds required to pay the
exercise price, or (6) any combination of the foregoing methods of payment. In
making its determination as to the type of consideration to accept, the
Administrator shall consider if acceptance of such consideration may be
reasonably expected to benefit the Company.

10. Exercise of Option.
------------------

(a) Procedure for Exercise; Rights as a Stockholder. Any Option
-----------------------------------------------
granted hereunder shall be exercisable at such times and under such conditions
as determined by the Administrator, including performance criteria with respect
to the Company and/or the Optionee, and as shall be permissible under the terms
of the Plan. With respect to Options granted after February 2, 1998 unless the
Administrator provides otherwise, the vesting of such Options shall be tolled
during any unpaid leave of absence.

An Option may not be exercised for a fraction of a Share.

An Option shall be deemed to be exercised when written notice of such
exercise has been given to the Company in accordance with the terms of the
Option by the person entitled to exercise the Option and full payment for the
Shares with respect to which the Option is exercised has been received by the
Company. Full payment may, as authorized by the Administrator, consist of any
consideration and method of payment allowable under Section 9(b) of the Plan.
Until the issuance (as evidenced by the appropriate entry on the books of the
Company or of a duly authorized transfer agent of the Company) of the stock
certificate evidencing such Shares, no right to vote or receive dividends or any
other rights as a stockholder shall exist with respect to the Optioned Stock,
notwithstanding the exercise of the Option. The Company shall issue (or cause
to be issued) such stock certificate promptly upon exercise of the Option. No
adjustment will be made for a dividend or

-7-
<PAGE>

other right for which the record date is prior to the date the stock certificate
is issued, except as provided in Section 12 of the Plan.

Exercise of an Option in any manner shall result in a decrease in the
number of Shares which thereafter may be available, both for purposes of the
Plan and for sale under the Option, by the number of Shares as to which the
Option is exercised.

(b) Termination of Employment or Consulting Relationship. In the
----------------------------------------------------
event of termination of an Optionee's Continuous Status as an Employee or
Consultant with the Company (but not in the event of an Optionee's change of
status from Employee to Consultant (in which case an Employee's Incentive Stock
Option shall automatically convert to a Nonstatutory Stock Option on the date
three (3) months and one day from the date of such change of status) or from
Consultant to Employee), such Optionee may, but only within such period of time
as is determined by the Administrator, with such determination in the case of an
Incentive Stock Option not exceeding three (3) months after the date of such
termination (but in no event later than the expiration date of the term of such
Option as set forth in the Option Agreement), exercise his or her Option to the
extent that Optionee was entitled to exercise it at the date of such
termination. To the extent that Optionee was not entitled to exercise the
Option at the date of such termination, or if Optionee does not exercise such
Option to the extent so entitled within the time specified herein, the Option
shall terminate.

(c) Disability of Optionee. In the event of termination of an
----------------------
Optionee's consulting relationship or Continuous Status as an Employee as a
result of his or her disability, Optionee may, but only within twelve (12)
months from the date of such termination (and in no event later than the
expiration date of the term of such Option as set forth in the Option
Agreement), exercise the Option to the extent otherwise entitled to exercise it
at the date of such termination; provided, however, that if such disability is
not a "disability" as such term is defined in Section 22(e)(3) of the Code, in
the case of an Incentive Stock Option such Incentive Stock Option shall
automatically convert to a Nonstatutory Stock Option on the day three months and
one day following such termination. To the extent that Optionee is not entitled
to exercise the Option at the date of termination, or if Optionee does not
exercise such Option to the extent so entitled within the time specified herein,
the Option shall terminate, and the Shares covered by such Option shall revert
to the Plan.

(d) Death of Optionee. In the event of the death of an Optionee, the
-----------------
Option may be exercised at any time within twelve (12) months following the date
of death (but in no event later than the expiration of the term of such Option
as set forth in the Notice of Grant), by the Optionee's estate or by a person
who acquired the right to exercise the Option by bequest or inheritance, but
only to the extent that the Optionee was entitled to exercise the Option at the
date of death. If, at the time of death, the Optionee was not entitled to
exercise his or her entire Option, the Shares covered by the unexercisable
portion of the Option shall immediately revert to the Plan. If, after death,
the Optionee's estate or a person who acquired the right to exercise the Option
by bequest or inheritance does not exercise the Option within the time specified
herein, the Option shall terminate, and the Shares covered by such Option shall
revert to the Plan.

-8-
<PAGE>

(e) Buyout Provisions. The Administrator may at any time offer to buy
-----------------
out for a payment in cash or Shares, an Option previously granted, based on such
terms and conditions as the Administrator shall establish and communicate to the
Optionee at the time that such offer is made.

11. Non-Transferability of Options. Unless determined otherwise by the
------------------------------
Administrator, an Option may not be sold, pledged, assigned, hypothecated,
transferred, or disposed of in any manner other than by will or by the laws of
descent or distribution and may be exercised, during the lifetime of the
Optionee, only by the Optionee. If the Administrator makes an Option
transferable, such Option shall contain such additional terms and conditions as
the Administrator deems appropriate.

12. Adjustments Upon Changes in Capitalization or Merger.
----------------------------------------------------

(a) Changes in Capitalization. Subject to any required action by the
-------------------------
stockholders of the Company, the number of shares of Common Stock covered by
each outstanding Option, and the number of shares of Common Stock which have
been authorized for issuance under the Plan but as to which no Options have yet
been granted or which have been returned to the Plan upon cancellation or
expiration of an Option, as well as the price per share of Common Stock covered
by each such outstanding Option, shall be proportionately adjusted for any
increase or decrease in the number of issued shares of Common Stock resulting
from a stock split, reverse stock split, stock dividend, combination or
reclassification of the Common Stock, or any other increase or decrease in the
number of issued shares of Common Stock effected without receipt of
consideration by the Company after [the IPO Date]; provided, however, that
conversion of any convertible securities of the Company shall not be deemed to
have been "effected without receipt of consideration." Such adjustment shall be
made by the Administrator, whose determination in that respect shall be final,
binding and conclusive. Except as expressly provided herein, no issuance by the
Company of shares of stock of any class, or securities convertible into shares
of stock of any class, shall affect, and no adjustment by reason thereof shall
be made with respect to, the number or price of shares of Common Stock subject
to an Option.

(b) Dissolution or Liquidation. In the event of the proposed
--------------------------
dissolution or liquidation of the Company, the Administrator shall notify the
Optionee at least fifteen (15) days prior to such proposed action. To the
extent it has not been previously exercised, the Option will terminate
immediately prior to the consummation of such proposed action.

(c) Merger or Asset Sale. In the event of a merger of the Company
--------------------
with or into another corporation, or the sale of substantially all of the assets
of the Company, each outstanding Option shall be assumed or an equivalent option
or right substituted by the successor corporation or a Parent or Subsidiary of
the successor corporation. In the event that the successor corporation refuses
to assume or substitute for the Option, the Optionee shall fully vest in and
have the right to exercise the Option as to all of the Optioned Stock, including
Shares as to which it would not otherwise be vested or exercisable. If an
Option becomes fully vested and exercisable in lieu of assumption or
substitution in the event of a merger or sale of assets, the Administrator shall
notify the Optionee in writing or electronically that the Option shall be fully
vested and exercisable for a period of fifteen (15) days from the date of such
notice,and the Option shall terminate upon the expiration of such period. For
the purposes of this paragraph, the Option shall be considered assumed if,
following the merger or sale of assets, the option or right confers the right to
purchase or receive for each Share of Optioned Stock subject to the Option
immediately prior to the merger or sale of assets, the consideration (whether
stock, cash, or other securities or property) received in the merger or sale of
assets by holders of Common Stock for each Share held on the effective date of
the transaction (and if holders were offered a choice of consideration, the type
of consideration chosen by the holders of a majority of the outstanding Shares);
provided, however, that if such consideration received in the merger or sale of
assets was not solely common stock of the successor corporation or its Parent,
the Administrator may, with the consent of the successor corporation, provide
for the consideration to be received upon the exercise of the Option for each
Share of

-9-
<PAGE>

(15) days from the date of such notice, and the Option shall terminate upon the
expiration of such period. For the purposes of this paragraph, the Option shall
be considered assumed if, following the merger or sale of assets, the option or
right confers the right to purchase or receive, for each Share of Optioned Stock
subject to the Option immediately prior to the merger or sale of assets, the
consideration (whether stock, cash, or other securities or property) received in
the merger or sale of assets by holders of Common Stock for each Share held on
the effective date of the transaction (and if holders were offered a choice of
consideration, the type of consideration chosen by the holders of a majority of
the outstanding Shares); provided, however, that if such consideration received
in the merger or sale of assets is not solely common stock of the successor
corporation or its Parent, the Administrator may, with the consent of the
successor corporation, provide for the consideration to be received upon the
exercise of the Option, for each Share of Optioned Stock subject to the Option,
to be solely common stock of the successor corporation or its Parent equal in
fair market value to the per share consideration received by holders of Common
Stock in the merger or sale of assets.

13. Time of Granting Options. The date of grant of an Option shall, for
------------------------
all purposes, be the date on which the Administrator makes the determination
granting such Option, or such other date as is determined by the Board. Notice
of the determination shall be given to each Employee or Consultant to whom an
Option is so granted within a reasonable time after the date of such grant.

14. Amendment and Termination of the Plan.
-------------------------------------

(a) Amendment and Termination. The Board may at any time amend,
-------------------------
alter, suspend or terminate the Plan.

(b) Stockholder Approval. The Company shall obtain stockholder
--------------------
approval of any Plan amendment to the extent necessary and desirable to comply
with Applicable Laws.

(c) Effect of Amendment or Termination. No amendment, alteration,
----------------------------------
suspension or termination of the Plan shall impair the rights of any Optionee,
unless mutually agreed otherwise between the Optionee and the Company, which
agreement must be in writing and signed by the Optionee and the Company.
Termination of the Plan shall not affect the Administrator's ability to exercise
the powers granted to it hereunder with respect to Options granted under the
Plan prior to the date of such termination.

15. Conditions Upon Issuance of Shares. Shares shall not be issued
----------------------------------
pursuant to the exercise of an Option unless the exercise of such Option and the
issuance and delivery of such Shares pursuant thereto shall comply with all
relevant provisions of law, including, without limitation, the Securities Act of
1933, as amended, the Exchange Act, the rules and regulations promulgated
thereunder, and the requirements of any stock exchange upon which the Shares may
then be listed, and shall be further subject to the approval of counsel for the
Company with respect to such compliance.

-10-
<PAGE>

As a condition to the exercise of an Option, the Company may require
the person exercising such Option to represent and warrant at the time of any
such exercise that the Shares are being purchased only for investment and
without any present intention to sell or distribute such Shares if, in the
opinion of counsel for the Company, such a representation is required by any of
the aforementioned relevant provisions of law.

16. Reservation of Shares. The Company, during the term of this Plan,
---------------------
will at all times reserve and keep available such number of Shares as shall be
sufficient to satisfy the requirements of the Plan.

The inability of the Company to obtain authority from any regulatory
body having jurisdiction, which authority is deemed by the Company's counsel to
be necessary to the lawful issuance and sale of any Shares hereunder, shall
relieve the Company of any liability in respect of the failure to issue or sell
such Shares as to which such requisite authority shall not have been obtained.

17. Agreements. Options shall be evidenced by written agreements in such
----------
form as the Administrator shall approve from time to time.

18. Stockholder Approval. Continuance of the Plan shall be subject to
--------------------
approval by the stockholders of the Company within twelve (12) months before or
after the date the Plan is adopted. Such stockholder approval shall be obtained
in the degree and manner required under applicable state and federal law and the
rules of any stock exchange upon which the Common Stock is listed.

-11-
<PAGE>

TICKETMASTER ONLINE-CITYSEARCH, INC.

1996 STOCK OPTION PLAN

STOCK OPTION AGREEMENT

Unless otherwise defined herein, the terms defined in the Plan shall have
the same defined meanings in this Stock Option Agreement.

I. NOTICE OF STOCK OPTION GRANT
----------------------------

[Optionee's Name and Address]

You have been granted an option to purchase [Class A] Common Stock of the
Company, subject to the terms and conditions of the Plan and this Option
Agreement, as follows:

Grant Number _________________________

Date of Grant _________________________

Vesting Commencement Date _________________________

Exercise Price per Share $________________________

Total Number of Shares Granted _________________________

Total Exercise Price $________________________

Type of Option: ___ Incentive Stock Option

___ Nonstatutory Stock Option

Term/Expiration Date: _________________________

Vesting Schedule:
----------------

Subject to your Continuous Status as an Employee or Consultant, this Option
may be exercised, in whole or in part, in accordance with the following
schedule:

25% of the Shares subject to the Option shall vest on the twelve-month
anniversary of the Vesting Commencement Date, and 1/48 of the Shares subject to
the Option shall vest each month thereafter on the monthly anniversary of the
Vesting Commencement Date.
<PAGE>

Termination Period:
------------------

Subject to Part II, Section 6, you may exercise this Option for three
months after your employment or consulting relationship with the Company
terminates, or for such longer period upon your death or disability as provided
in the Plan. If your status changes from Employee to Consultant or Consultant to
Employee, this Option Agreement shall remain in effect. In no case may you
exercise this Option after the Term/Expiration Date as provided above.

II. AGREEMENT
---------

1. Grant of Option. The Plan Administrator of the Company hereby grants
---------------
to the Optionee named in the Notice of Grant attached as Part I of this
Agreement (the "Optionee") an option (the "Option") to purchase the number of
Shares, as set forth in the Notice of Grant, at the exercise price per share set
forth in the Notice of Grant (the "Exercise Price"), subject to the terms and
conditions of the Plan, which is incorporated herein by reference. Subject to
Section 14(c) of the Plan, in the event of a conflict between the terms and
conditions of the Plan and the terms and conditions of this Option Agreement,
the terms and conditions of the Plan shall prevail.

If designated in the Notice of Grant as an Incentive Stock Option
("ISO"), this Option is intended to qualify as an Incentive Stock Option under
Section 422 of the Code. However, if this Option is intended to be an Incentive
Stock Option, to the extent that it exceeds the $100,000 rule of Code Section
422(d) it shall be treated as a Nonstatutory Stock Option ("NSO").

2. Exercise of Option.
------------------

(a) Right to Exercise. This Option is exercisable during its term in
-----------------
accordance with the Vesting Schedule set out in the Notice of Grant and the
applicable provisions of the Plan and this Option Agreement.

(b) Method of Exercise. This Option is exercisable by delivery of an
------------------
exercise notice, in the form attached as Exhibit A (the "Exercise Notice"),
which shall state the election to exercise the Option, the number of Shares in
respect of which the Option is being exercised (the "Exercised Shares"), and
such other representations and agreements as may be required by the Company
pursuant to the provisions of the Plan. The Exercise Notice shall be completed
by the Optionee and delivered to the Company. The Exercise Notice shall be
accompanied by payment of the aggregate Exercise Price as to all Exercised
Shares. This Option shall be deemed to be exercised upon receipt by the Company
of such fully executed Exercise Notice accompanied by such aggregate Exercise
Price.

No Shares shall be issued pursuant to the exercise of this Option
unless such issuance and exercise complies with Applicable Laws.

-2-
<PAGE>

3. Method of Payment. Payment of the aggregate Exercise Price shall be
-----------------
by any of the following, or a combination thereof, at the election of the
Optionee:

(a) cash;

(b) check;

(c) consideration received by the Company under a cashless exercise
program implemented by the Company in connection with the Plan; or

(d) surrender of other Shares which (i) in the case of Shares
acquired upon exercise of an option, have been owned by the Optionee for more
than six (6) months on the date of surrender, AND (ii) have a Fair Market Value
on the date of surrender equal to the aggregate Exercise Price of the Exercised
Shares.

4. Non-Transferability of Option. This Option may not be transferred in
-----------------------------
any manner otherwise than by will or by the laws of descent or distribution and
may be exercised during the lifetime of Optionee only by the Optionee. The
terms of the Plan and this Option Agreement shall be binding upon the executors,
administrators, heirs, successors and assigns of the Optionee.

5. Term of Option. This Option may be exercised only within the term set
--------------
out in the Notice of Grant, and may be exercised during such term only in
accordance with the Plan and the terms of this Option Agreement.

6. Termination of Relationship. In the event an Optionee's Continuous
---------------------------
Status as an Employee or Consultant terminates, Optionee may, to the extent
otherwise so entitled at the date of such termination (the "Termination Date"),
exercise this Option during the Termination Period set out in the Notice of
Grant. To the extent that Optionee was not entitled to exercise this Option at
the date of such termination, or if Optionee does not exercise this Option
within the time specified herein, the Option shall terminate. An Optionee's
Continuous Status as a Consultant shall terminate at the completion of any three
month period in which the Optionee works less than one hour on behalf of the
Company in each of the three months.

7. Disability of Optionee. Notwithstanding the provisions of Section 6
----------------------
above, in the event of termination of an Optionee's consulting relationship or
Continuous Status as an Employee as a result of his or her disability, Optionee
may, but only within twelve (12) months from the date of such termination (and
in no event later than the expiration date of the term of such Option as set
forth in the Option Agreement), exercise the Option to the extent otherwise
entitled to exercise it at the date of such termination; provided, however, that
if such disability is not a "disability" as such term is defined in Section
22(e)(3) of the Code, in the case of an Incentive Stock Option such Incentive
Stock Option shall cease to be treated as an Incentive Stock Option and shall be
treated for tax purposes as a Nonstatutory Stock Option on the day three months
and one day following such termination. To the extent that Optionee was not
entitled to exercise the

-3-
<PAGE>

Option at the date of termination, or if Optionee does not exercise such Option
to the extent so entitled within the time specified herein, the Option shall
terminate, and the Shares covered by such Option shall revert to the Plan.

8. Death of Optionee. In the event of termination of Optionee's
-----------------
Continuous Status as an Employee or Consultant as a result of the death of
Optionee, the Option may be exercised at any time within twelve (12) months
following the date of death (but in no event later than the date of expiration
of the term of this Option as set forth in Section 10 below), by Optionee's
estate or by a person who acquired the right to exercise the Option by bequest
or inheritance, but only to the extent the Optionee could exercise the Option at
the date of death.

-4-
<PAGE>

9. Entire Agreement; Governing Law. The Plan is incorporated herein by
-------------------------------
reference. The Plan and this Option Agreement constitute the entire agreement
of the parties with respect to the subject matter hereof and supersede in their
entirety all prior undertakings and agreements of the Company and Optionee with
respect to the subject matter hereof, and may not be modified adversely to the
Optionee's interest except by means of a writing signed by the Company and
Optionee. This agreement is governed by the internal substantive laws, but not
the choice of law rules, of Delaware.

10. NO GUARANTEE OF CONTINUED SERVICE. OPTIONEE ACKNOWLEDGES AND AGREES
---------------------------------
THAT THE VESTING OF SHARES PURSUANT TO THE VESTING SCHEDULE HEREOF IS EARNED
ONLY BY CONTINUING AS A SERVICE PROVIDER AT THE WILL OF THE COMPANY (AND NOT
THROUGH THE ACT OF BEING HIRED, BEING GRANTED AN OPTION OR PURCHASING SHARES
HEREUNDER). OPTIONEE FURTHER ACKNOWLEDGES AND AGREES THAT THIS AGREEMENT, THE
TRANSACTIONS CONTEMPLATED HEREUNDER AND THE VESTING SCHEDULE SET FORTH HEREIN DO
NOT CONSTITUTE AN EXPRESS OR IMPLIED PROMISE OF CONTINUED ENGAGEMENT AS A
SERVICE PROVIDER FOR THE VESTING PERIOD, FOR ANY PERIOD, OR AT ALL, AND SHALL
NOT INTERFERE WITH OPTIONEE'S RIGHT OR THE COMPANY'S RIGHT TO TERMINATE
OPTIONEE'S RELATIONSHIP AS A SERVICE PROVIDER AT ANY TIME, WITH OR WITHOUT
CAUSE.

-5-
<PAGE>

entirety, has had an opportunity to obtain the advice of counsel prior to
executing this Option Agreement and fully understands all provisions of the Plan
and Option Agreement. Optionee hereby agrees to accept as binding, conclusive
and final all decisions or interpretations of the Administrator upon any
questions relating to the Plan and Option Agreement. Optionee further agrees to
notify the Company upon any change in the residence address indicated below.

OPTIONEE: TICKETMASTER ONLINE-CITYSEARCH, INC.

__________________________ ______________________________________
Signature By

__________________________ ______________________________________
Print Name Title

__________________________
Residence Address

__________________________

-6-
<PAGE>

EXHIBIT A
---------

1996 STOCK OPTION PLAN

EXERCISE NOTICE

Ticketmaster Online-CitySearch, Inc.
790 E. Colorado Blvd., Suite 200
Pasadena, CA 91101

Attention: Secretary

1. Exercise of Option. Effective as of today, ________________, 199__,
------------------
the undersigned ("Purchaser") hereby elects to purchase ______________ shares
(the "Shares") of the Class A Common Stock of Ticketmaster Online-CitySearch,
Inc. (the "Company") under and pursuant to the 1996 Stock Option Plan (the
"Plan") and the Stock Option Agreement dated ___________, 19___ (the "Option
Agreement"). The purchase price for the Shares shall be $_____________, as
required by the Option Agreement.

2. Delivery of Payment. Purchaser herewith delivers to the Company the
-------------------
full purchase price for the Shares.

3. Representations of Purchaser. Purchaser acknowledges that Purchaser
----------------------------
has received, read and understood the Plan and the Option Agreement and agrees
to abide by and be bound by their terms and conditions.

4. Rights as Stockholder. Until the issuance (as evidenced by the
---------------------
appropriate entry on the books of the Company or of a duly authorized transfer
agent of the Company) of the Shares, no right to vote or receive dividends or
any other rights as a stockholder shall exist with respect to the Optioned
Stock, notwithstanding the exercise of the Option. The Shares so acquired shall
be issued to the Optionee as soon as practicable after exercise of the Option.
No adjustment will be made for a dividend or other right for which the record
date is prior to the date of issuance, except as provided in Section 12 of the
Plan.

5. Tax Consultation. Purchaser understands that Purchaser may suffer
----------------
adverse tax consequences as a result of Purchaser's purchase or disposition of
the Shares. Purchaser represents that Purchaser has consulted with any tax
consultants Purchaser deems advisable in connection with the purchase or
disposition of the Shares and that Purchaser is not relying on the Company for
any tax advice.

-1-
<PAGE>

agreement of the parties with respect to the subject matter hereof and supersede
in their entirety all prior undertakings and agreements of the Company and
Purchaser with respect to the subject matter hereof, and may not be modified
adversely to the Purchaser's interest except by means of a writing signed by the
Company and Purchaser. This agreement is governed by the internal substantive
laws, but not the choice of law rules, of Delaware.

Submitted by: Accepted by:

PURCHASER: TICKETMASTER ONLINE-CITYSEARCH, INC.

______________________________ ______________________________
Signature By

______________________________ ______________________________
Print Name Its

Address: Address:
- ------- -------

______________________________ 790 E. Colorado Blvd., Suite 200
______________________________ Pasadena, CA 91101

______________________________
Date Received

-2-

<PAGE>

EXHIBIT 10.3

TICKETMASTER ONLINE-CITYSEARCH, INC.

1998 STOCK PLAN

1. Purposes of the Plan. The purposes of this 1998 Stock Plan are:
--------------------

. to attract and retain the best available personnel for positions of
substantial responsibility,

. to provide additional incentive to Employees, Directors and
Consultants, and

. to promote the success of the Company's business.

Options granted under the Plan may be Incentive Stock Options or
Nonstatutory Stock Options, as determined by the Administrator at the time of
grant. Stock Purchase Rights may also be granted under the Plan.

2. Definitions. As used herein, the following definitions shall apply:
-----------

(a) "Administrator" means the Board or any of its Committees as shall be
-------------
administering the Plan, in accordance with Section 4 of the Plan.

(d) "Code" means the Internal Revenue Code of 1986, as amended.
----

(e) "Committee" means a committee of Directors appointed by the Board
---------
in accordance with Section 4 of the Plan.

(f) "Common Stock" means the Class B Common Stock of the Company.
------------

(g) "Company" means Ticketmaster Online-CitySearch, Inc., a Delaware
-------
corporation.

(h) "Consultant" means any person, including an advisor, engaged by the
----------
Company or a Parent or Subsidiary to render services to such entity.

(i) "Director" means a member of the Board.
--------
<PAGE>

(j) "Disability" means total and permanent disability as defined in
----------
Section 22(e)(3) of the Code.

(k) "Employee" means any person, including Officers and Directors,
--------
employed by the Company or any Parent or Subsidiary of the Company. A Service
Provider shall not cease to be an Employee in the case of (i) any leave of
absence approved by the Company or (ii) transfers between locations of the
Company or between the Company, its Parent, any Subsidiary, or any successor.
For purposes of Incentive Stock Options, no such leave may exceed ninety days,
unless reemployment upon expiration of such leave is guaranteed by statute or
contract. If reemployment upon expiration of a leave of absence approved by the
Company is not so guaranteed, on the 181st day of such leave any Incentive Stock
Option held by the Optionee shall cease to be treated as an Incentive Stock
Option and shall be treated for tax purposes as a Nonstatutory Stock Option.
Neither service as a Director nor payment of a director's fee by the Company
shall be sufficient to constitute "employment" by the Company.

(l) "Exchange Act" means the Securities Exchange Act of 1934, as
------------
amended.

(m) "Fair Market Value" means, as of any date, the value of Common Stock
-----------------
determined as follows:

(ii) If the Common Stock is regularly quoted by a recognized
securities dealer but selling prices are not reported, the Fair Market Value of
a Share of Common Stock shall be the mean between the high bid and low asked
prices for the Common Stock on the last market trading day prior to the day of
determination, as reported in The Wall Street Journal or such other source as
the Administrator deems reliable; or

(iii) In the absence of an established market for the Common Stock,
the Fair Market Value shall be determined in good faith by the Administrator.

(n) "Incentive Stock Option" means an Option intended to qualify as an
----------------------
incentive stock option within the meaning of Section 422 of the Code and the
regulations promulgated thereunder.

(o) "Nonstatutory Stock Option" means an Option not intended to qualify
-------------------------
as an Incentive Stock Option.

-2-
<PAGE>

(p) "Notice of Grant" means a written or electronic notice evidencing
---------------
certain terms and conditions of an individual Option or Stock Purchase Right
grant. The Notice of Grant is part of the Option Agreement.

(q) "Officer" means a person who is an officer of the Company within
-------
the meaning of Section 16 of the Exchange Act and the rules and regulations
promulgated thereunder.

(r) "Option" means a stock option granted pursuant to the Plan.
------

(s) "Option Agreement" means an agreement between the Company and an
----------------
Optionee evidencing the terms and conditions of an individual Option grant. The
Option Agreement is subject to the terms and conditions of the Plan.

(t) "Option Exchange Program" means a program whereby outstanding
-----------------------
Options are surrendered in exchange for Options with a lower exercise price.

(u) "Optioned Stock" means the Common Stock subject to an Option or
--------------
Stock Purchase Right.

(v) "Optionee" means the holder of an outstanding Option or Stock
--------
Purchase Right granted under the Plan.

(w) "Parent" means a "parent corporation," whether now or hereafter
------
existing, as defined in Section 424(e) of the Code.

(x) "Plan" means this 1998 Stock Plan.
----

(y) "Restricted Stock" means shares of Common Stock acquired pursuant
----------------
to a grant of Stock Purchase Rights under Section 11 of the Plan.

(z) "Restricted Stock Purchase Agreement" means a written agreement
-----------------------------------
between the Company and the Optionee evidencing the terms and restrictions
applying to stock purchased under a Stock Purchase Right. The Restricted Stock
Purchase Agreement is subject to the terms and conditions of the Plan and the
Notice of Grant.

(aa) "Rule 16b-3" means Rule 16b-3 of the Exchange Act or any successor
----------
to Rule 16b-3, as in effect when discretion is being exercised with respect to
the Plan.

(bb) "Section 16(b)" means Section 16(b) of the Exchange Act.
-------------

(cc) "Service Provider" means an Employee, Director or Consultant.
----------------

-3-
<PAGE>

(dd) "Share" means a share of the Common Stock, as adjusted in
-----
accordance with Section 13 of the Plan.

(ee) "Stock Purchase Right" means the right to purchase Common Stock
--------------------
pursuant to Section 11 of the Plan, as evidenced by a Notice of Grant.

(ff) "Subsidiary" means a "subsidiary corporation", whether now or
----------
hereafter existing, as defined in Section 424(f) of the Code.

3. Stock Subject to the Plan. Subject to the provisions of Section 13 of
-------------------------
the Plan, the maximum aggregate number of Shares which may be optioned and sold
under the Plan is 4,000,000 Shares. The Shares may be authorized, but unissued,
or reacquired Common Stock.

If an Option or Stock Purchase Right expires or becomes unexercisable
without having been exercised in full, or is surrendered pursuant to an Option
Exchange Program, the unpurchased Shares which were subject thereto shall become
available for future grant or sale under the Plan (unless the Plan has
terminated); provided, however, that Shares that have actually been issued under
--------
the Plan, whether upon exercise of an Option or Right, shall not be returned to
the Plan and shall not become available for future distribution under the Plan,
except that if Shares of Restricted Stock are repurchased by the Company at
their original purchase price, such Shares shall become available for future
grant under the Plan.

4. Administration of the Plan.
--------------------------

(a) Procedure.
---------

(i) Multiple Administrative Bodies. The Plan may be administered
------------------------------
by different Committees with respect to different groups of Service Providers.

(ii) Section 162(m). To the extent that the Administrator
--------------
determines it to be desirable to qualify Options granted hereunder as
"performance-based compensation" within the meaning of Section 162(m) of the
Code, the Plan shall be administered by a Committee of two or more "outside
directors" within the meaning of Section 162(m) of the Code.

(iii) Rule 16b-3. To the extent desirable to qualify transactions
----------
hereunder as exempt under Rule 16b-3, the transactions contemplated hereunder
shall be structured to satisfy the requirements for exemption under Rule 16b-3.

(iv) Other Administration. Other than as provided above, the Plan
--------------------
shall be administered by (A) the Board or (B) a Committee, which committee shall
be constituted to satisfy Applicable Laws.

-4-
<PAGE>

(b) Powers of the Administrator. Subject to the provisions of the Plan,
---------------------------
and in the case of a Committee, subject to the specific duties delegated by the
Board to such Committee, the Administrator shall have the authority, in its
discretion:

(i) to determine the Fair Market Value;

(ii) to select the Service Providers to whom Options and Stock
Purchase Rights may be granted hereunder;

(iii) to determine the number of shares of Common Stock to be
covered by each Option and Stock Purchase Right granted hereunder;

(iv) to approve forms of agreement for use under the Plan;

(v) to determine the terms and conditions, not inconsistent with
the terms of the Plan, of any Option or Stock Purchase Right granted hereunder.
Such terms and conditions include, but are not limited to, the exercise price,
the time or times when Options or Stock Purchase Rights may be exercised (which
may be based on performance criteria), any vesting acceleration or waiver of
forfeiture restrictions, and any restriction or limitation regarding any Option
or Stock Purchase Right or the shares of Common Stock relating thereto, based in
each case on such factors as the Administrator, in its sole discretion, shall
determine;

(vi) to reduce the exercise price of any Option or Stock Purchase
Right to the then current Fair Market Value if the Fair Market Value of the
Common Stock covered by such Option or Stock Purchase Right shall have declined
since the date the Option or Stock Purchase Right was granted;

(vii) to institute an Option Exchange Program;

(viii) to construe and interpret the terms of the Plan and awards
granted pursuant to the Plan;

(ix) to prescribe, amend and rescind rules and regulations
relating to the Plan, including rules and regulations relating to sub-plans
established for the purpose of qualifying for preferred tax treatment under
foreign tax laws;

(x) to modify or amend each Option or Stock Purchase Right
(subject to Section 15(c) of the Plan), including the discretionary authority to
extend the post-termination exercisability period of Options longer than is
otherwise provided for in the Plan;

(xi) to allow Optionees to satisfy withholding tax obligations by
electing to have the Company withhold from the Shares to be issued upon exercise
of an Option or Stock

-5-
<PAGE>

Purchase Right that number of Shares having a Fair Market Value equal to the
amount required to be withheld. The Fair Market Value of the Shares to be
withheld shall be determined on the date that the amount of tax to be withheld
is to be determined. All elections by an Optionee to have Shares withheld for
this purpose shall be made in such form and under such conditions as the
Administrator may deem necessary or advisable;

(xii) to authorize any person to execute on behalf of the Company
any instrument required to effect the grant of an Option or Stock Purchase Right
previously granted by the Administrator;

(xiii) to make all other determinations deemed necessary or
advisable for administering the Plan.

(c) Effect of Administrator's Decision. The Administrator's decisions,
----------------------------------
determinations and interpretations shall be final and binding on all Optionees
and any other holders of Options or Stock Purchase Rights.

5. Eligibility. Nonstatutory Stock Options and Stock Purchase Rights may
-----------
be granted to Service Providers. Incentive Stock Options may be granted only to
Employees.

6. Limitations.
-----------

(a) Each Option shall be designated in the Option Agreement as either an
Incentive Stock Option or a Nonstatutory Stock Option. However, notwithstanding
such designation, to the extent that the aggregate Fair Market Value of the
Shares with respect to which Incentive Stock Options are exercisable for the
first time by the Optionee during any calendar year (under all plans of the
Company and any Parent or Subsidiary) exceeds $100,000, such Options shall be
treated as Nonstatutory Stock Options. For purposes of this Section 6(a),
Incentive Stock Options shall be taken into account in the order in which they
were granted. The Fair Market Value of the Shares shall be determined as of the
time the Option with respect to such Shares is granted.

(b) Neither the Plan nor any Option or Stock Purchase Right shall confer
upon an Optionee any right with respect to continuing the Optionee's
relationship as a Service Provider with the Company, nor shall they interfere in
any way with the Optionee's right or the Company's right to terminate such
relationship at any time, with or without cause.

(i) No Service Provider shall be granted, in any fiscal year of the
Company, Options to purchase more than 500,000 Shares.

-6-
<PAGE>

(ii) In connection with his or her initial service, a Service
Provider may be granted Options to purchase up to an additional 1,000,000 Shares
which shall not count against the limit set forth in subsection (i) above.

(iii) The foregoing limitations shall be adjusted proportionately
in connection with any change in the Company's capitalization as described in
Section 13.

(iv) If an Option is cancelled in the same fiscal year of the
Company in which it was granted (other than in connection with a transaction
described in Section 13), the cancelled Option will be counted against the
limits set forth in subsections (i) and (ii) above. For this purpose, if the
exercise price of an Option is reduced, the transaction will be treated as a
cancellation of the Option and the grant of a new Option.

7. Term of Plan. Subject to Section 19 of the Plan, the Plan shall become
------------
effective upon its adoption by the Board. It shall continue in effect for a
term of ten (10) years unless terminated earlier under Section 15 of the Plan.

8. Term of Option. The term of each Option shall be stated in the Option
--------------
Agreement. In the case of an Incentive Stock Option, the term shall be ten (10)
years from the date of grant or such shorter term as may be provided in the
Option Agreement. Moreover, in the case of an Incentive Stock Option granted to
an Optionee who, at the time the Incentive Stock Option is granted, owns stock
representing more than ten percent (10%) of the total combined voting power of
all classes of stock of the Company or any Parent or Subsidiary, the term of the
Incentive Stock Option shall be five (5) years from the date of grant or such
shorter term as may be provided in the Option Agreement.

9. Option Exercise Price and Consideration.
---------------------------------------

(a) Exercise Price. The per share exercise price for the Shares to be
--------------
issued pursuant to exercise of an Option shall be determined by the
Administrator, subject to the following:

(i) In the case of an Incentive Stock Option

(A) granted to an Employee who, at the time the Incentive Stock
Option is granted, owns stock representing more than ten percent (10%) of the
voting power of all classes of stock of the Company or any Parent or Subsidiary,
the per Share exercise price shall be no less than 110% of the Fair Market Value
per Share on the date of grant.

(B) granted to any Employee other than an Employee described in
paragraph (A) immediately above, the per Share exercise price shall be no less
than 100% of the Fair Market Value per Share on the date of grant.

-7-
<PAGE>

(b) Waiting Period and Exercise Dates. At the time an Option is
---------------------------------
granted, the Administrator shall fix the period within which the Option may be
exercised and shall determine any conditions which must be satisfied before the
Option may be exercised.

(c) Form of Consideration. The Administrator shall determine the
---------------------
acceptable form of consideration for exercising an Option, including the method
of payment. In the case of an Incentive Stock Option, the Administrator shall
determine the acceptable form of consideration at the time of grant. Such
consideration may consist entirely of:

(i) cash;

(ii) check;

(iii) promissory note;

(iv) other Shares which (A) in the case of Shares acquired upon
exercise of an option, have been owned by the Optionee for more than six months
on the date of surrender, and (B) have a Fair Market Value on the date of
surrender equal to the aggregate exercise price of the Shares as to which said
Option shall be exercised;

(v) consideration received by the Company under a cashless
exercise program implemented by the Company in connection with the Plan;

(vi) a reduction in the amount of any Company liability to the
Optionee, including any liability attributable to the Optionee's participation
in any Company-sponsored deferred compensation program or arrangement;

(vii) any combination of the foregoing methods of payment; or

(viii) such other consideration and method of payment for the
issuance of Shares to the extent permitted by Applicable Laws.

-8-
<PAGE>

10. Exercise of Option.
------------------

(a) Procedure for Exercise; Rights as a Stockholder. Any Option granted
-----------------------------------------------
hereunder shall be exercisable according to the terms of the Plan and at such
times and under such conditions as determined by the Administrator and set forth
in the Option Agreement. Unless the Administrator provides otherwise, vesting
of Options granted hereunder shall be tolled during any unpaid leave of absence.
An Option may not be exercised for a fraction of a Share.

An Option shall be deemed exercised when the Company receives: (i)
written or electronic notice of exercise (in accordance with the Option
Agreement) from the person entitled to exercise the Option, and (ii) full
payment for the Shares with respect to which the Option is exercised. Full
payment may consist of any consideration and method of payment authorized by the
Administrator and permitted by the Option Agreement and the Plan. Shares issued
upon exercise of an Option shall be issued in the name of the Optionee or, if
requested by the Optionee, in the name of the Optionee and his or her spouse.
Until the Shares are issued (as evidenced by the appropriate entry on the books
of the Company or of a duly authorized transfer agent of the Company), no right
to vote or receive dividends or any other rights as a stockholder shall exist
with respect to the Optioned Stock, notwithstanding the exercise of the Option.
The Company shall issue (or cause to be issued) such Shares promptly after the
Option is exercised. No adjustment will be made for a dividend or other right
for which the record date is prior to the date the Shares are issued, except as
provided in Section 13 of the Plan.

Exercising an Option in any manner shall decrease the number of
Shares thereafter available, both for purposes of the Plan and for sale under
the Option, by the number of Shares as to which the Option is exercised.

(b) Termination of Relationship as a Service Provider. If an Optionee
-------------------------------------------------
ceases to be a Service Provider, other than upon the Optionee's death or
Disability, the Optionee may exercise his or her Option within such period of
time as is specified in the Option Agreement to the extent that the Option is
vested on the date of termination (but in no event later than the expiration of
the term of such Option as set forth in the Option Agreement). In the absence
of a specified time in the Option Agreement, the Option shall remain exercisable
for three (3) months following the Optionee's termination. If, on the date of
termination, the Optionee is not vested as to his or her entire Option, the
Shares covered by the unvested portion of the Option shall revert to the Plan.
If, after termination, the Optionee does not exercise his or her Option within
the time specified by the Administrator, the Option shall terminate, and the
Shares covered by such Option shall revert to the Plan.

(c) Disability of Optionee. If an Optionee ceases to be a Service
----------------------
Provider as a result of the Optionee's Disability, the Optionee may exercise his
or her Option within such period of time as is specified in the Option Agreement
to the extent the Option is vested on the date of termination (but in no event
later than the expiration of the term of such Option as set forth in the Option

-9-
<PAGE>

Agreement). In the absence of a specified time in the Option Agreement, the
Option shall remain exercisable for twelve (12) months following the Optionee's
termination. If, on the date of termination, the Optionee is not vested as to
his or her entire Option, the Shares covered by the unvested portion of the
Option shall revert to the Plan. If, after termination, the Optionee does not
exercise his or her Option within the time specified herein, the Option shall
terminate, and the Shares covered by such Option shall revert to the Plan.

(d) Death of Optionee. If an Optionee dies while a Service Provider,
-----------------
the Option may be exercised within such period of time as is specified in the
Option Agreement (but in no event later than the expiration of the term of such
Option as set forth in the Notice of Grant), by the Optionee's estate or by a
person who acquires the right to exercise the Option by bequest or inheritance,
but only to the extent that the Option is vested on the date of death. In the
absence of a specified time in the Option Agreement, the Option shall remain
exercisable for twelve (12) months following the Optionee's termination. If, at
the time of death, the Optionee is not vested as to his or her entire Option,
the Shares covered by the unvested portion of the Option shall immediately
revert to the Plan. The Option may be exercised by the executor or
administrator of the Optionee's estate or, if none, by the person(s) entitled to
exercise the Option under the Optionee's will or the laws of descent or
distribution. If the Option is not so exercised within the time specified
herein, the Option shall terminate, and the Shares covered by such Option shall
revert to the Plan.

(e) Buyout Provisions. The Administrator may at any time offer to buy
-----------------
out for a payment in cash or Shares an Option previously granted based on such
terms and conditions as the Administrator shall establish and communicate to the
Optionee at the time that such offer is made.

11. Stock Purchase Rights.
---------------------

(a) Rights to Purchase. Stock Purchase Rights may be issued either
------------------
alone, in addition to, or in tandem with other awards granted under the Plan
and/or cash awards made outside of the Plan. After the Administrator determines
that it will offer Stock Purchase Rights under the Plan, it shall advise the
offeree in writing or electronically, by means of a Notice of Grant, of the
terms, conditions and restrictions related to the offer, including the number of
Shares that the offeree shall be entitled to purchase, the price to be paid, and
the time within which the offeree must accept such offer. The offer shall be
accepted by execution of a Restricted Stock Purchase Agreement in the form
determined by the Administrator.

(b) Repurchase Option. Unless the Administrator determines otherwise,
-----------------
the Restricted Stock Purchase Agreement shall grant the Company a repurchase
option exercisable upon the voluntary or involuntary termination of the
purchaser's service with the Company for any reason (including death or
Disability). The purchase price for Shares repurchased pursuant to the
Restricted Stock Purchase Agreement shall be the original price paid by the
purchaser and may be paid by cancellation of any indebtedness of the purchaser
to the Company. The repurchase option shall lapse at a rate determined by the
Administrator.

-10-
<PAGE>

(c) Other Provisions. The Restricted Stock Purchase Agreement shall
----------------
contain such other terms, provisions and conditions not inconsistent with the
Plan as may be determined by the Administrator in its sole discretion.

(d) Rights as a Stockholder. Once the Stock Purchase Right is
-----------------------
exercised, the purchaser shall have the rights equivalent to those of a
stockholder, and shall be a stockholder when his or her purchase is entered upon
the records of the duly authorized transfer agent of the Company. No adjustment
will be made for a dividend or other right for which the record date is prior to
the date the Stock Purchase Right is exercised, except as provided in Section 13
of the Plan.

12. Non-Transferability of Options and Stock Purchase Rights. Unless
--------------------------------------------------------
determined otherwise by the Administrator, an Option or Stock Purchase Right may
not be sold, pledged, assigned, hypothecated, transferred, or disposed of in any
manner other than by will or by the laws of descent or distribution and may be
exercised, during the lifetime of the Optionee, only by the Optionee. If the
Administrator makes an Option or Stock Purchase Right transferable, such Option
or Stock Purchase Right shall contain such additional terms and conditions as
the Administrator deems appropriate.

13. Adjustments Upon Changes in Capitalization, Dissolution, Merger or
------------------------------------------------------------------
Asset Sale.
- ----------

(a) Changes in Capitalization. Subject to any required action by the
-------------------------
stockholders of the Company, the number of shares of Common Stock covered by
each outstanding Option and Stock Purchase Right, and the number of shares of
Common Stock which have been authorized for issuance under the Plan but as to
which no Options or Stock Purchase Rights have yet been granted or which have
been returned to the Plan upon cancellation or expiration of an Option or Stock
Purchase Right, as well as the price per share of Common Stock covered by each
such outstanding Option or Stock Purchase Right, shall be proportionately
adjusted for any increase or decrease in the number of issued shares of Common
Stock resulting from a stock split, reverse stock split, stock dividend,
combination or reclassification of the Common Stock, or any other increase or
decrease in the number of issued shares of Common Stock effected without receipt
of consideration by the Company; provided, however, that conversion of any
convertible securities of the Company shall not be deemed to have been "effected
without receipt of consideration." Such adjustment shall be made by the Board,
whose determination in that respect shall be final, binding and conclusive.
Except as expressly provided herein, no issuance by the Company of shares of
stock of any class, or securities convertible into shares of stock of any class,
shall affect, and no adjustment by reason thereof shall be made with respect to,
the number or price of shares of Common Stock subject to an Option or Stock
Purchase Right.

(b) Dissolution or Liquidation. In the event of the proposed
--------------------------
dissolution or liquidation of the Company, the Administrator shall notify each
Optionee as soon as practicable prior to the effective date of such proposed
transaction. The Administrator in its discretion may provide for an Optionee to
have the right to exercise his or her Option until ten (10) days prior to such
transaction

-11-
<PAGE>

as to all of the Optioned Stock covered thereby, including Shares as to which
the Option would not otherwise be exercisable. In addition, the Administrator
may provide that any Company repurchase option applicable to any Shares
purchased upon exercise of an Option or Stock Purchase Right shall lapse as to
all such Shares, provided the proposed dissolution or liquidation takes place at
the time and in the manner contemplated. To the extent it has not been
previously exercised, an Option or Stock Purchase Right will terminate
immediately prior to the consummation of such proposed action.

(c) Merger or Asset Sale. In the event of a merger of the Company
--------------------
with or into another corporation, or the sale of substantially all of the assets
of the Company, each outstanding Option and Stock Purchase Right shall be
assumed or an equivalent option or right substituted by the successor
corporation or a Parent or Subsidiary of the successor corporation. In the event
that the successor corporation refuses to assume or substitute for the Option or
Stock Purchase Right, the Optionee shall fully vest in and have the right to
exercise the Option or Stock Purchase Right as to all of the Optioned Stock,
including Shares as to which it would not otherwise be vested or exercisable. If
an Option or Stock Purchase Right becomes fully vested and exercisable in lieu
of assumption or substitution in the event of a merger or sale of assets, the
Administrator shall notify the Optionee in writing or electronically that the
Option or Stock Purchase Right shall be fully vested and exercisable for a
period of fifteen (15) days from the date of such notice, and the Option or
Stock Purchase Right shall terminate upon the expiration of such period. For the
purposes of this paragraph, the Option or Stock Purchase Right shall be
considered assumed if, following the merger or sale of assets, the option or
right confers the right to purchase or receive, for each Share of Optioned Stock
subject to the Option or Stock Purchase Right immediately prior to the merger or
sale of assets, the consideration (whether stock, cash, or other securities or
property) received in the merger or sale of assets by holders of Common Stock
for each Share held on the effective date of the transaction (and if holders
were offered a choice of consideration, the type of consideration chosen by the
holders of a majority of the outstanding Shares); provided, however, that if
such consideration received in the merger or sale of assets is not solely common
stock of the successor corporation or its Parent, the Administrator may, with
the consent of the successor corporation, provide for the consideration to be
received upon the exercise of the Option or Stock Purchase Right, for each Share
of Optioned Stock subject to the Option or Stock Purchase Right, to be solely
common stock of the successor corporation or its Parent equal in fair market
value to the per share consideration received by holders of Common Stock in the
merger or sale of assets.

14. Date of Grant. The date of grant of an Option or Stock Purchase Right
-------------
shall be, for all purposes, the date on which the Administrator makes the
determination granting such Option or Stock Purchase Right, or such other later
date as is determined by the Administrator. Notice of the determination shall
be provided to each Optionee within a reasonable time after the date of such
grant.

15. Amendment and Termination of the Plan.
-------------------------------------

-12-
<PAGE>

(a) Amendment and Termination. The Board may at any time amend,
-------------------------
alter, suspend or terminate the Plan.

(b) Stockholder Approval. The Company shall obtain stockholder
--------------------
approval of any Plan amendment to the extent necessary and desirable to comply
with Applicable Laws.

16. Conditions Upon Issuance of Shares.
----------------------------------

(a) Legal Compliance. Shares shall not be issued pursuant to the
----------------
exercise of an Option or Stock Purchase Right unless the exercise of such Option
or Stock Purchase Right and the issuance and delivery of such Shares shall
comply with Applicable Laws and shall be further subject to the approval of
counsel for the Company with respect to such compliance.

(b) Investment Representations. As a condition to the exercise of an
--------------------------
Option or Stock Purchase Right, the Company may require the person exercising
such Option or Stock Purchase Right to represent and warrant at the time of any
such exercise that the Shares are being purchased only for investment and
without any present intention to sell or distribute such Shares if, in the
opinion of counsel for the Company, such a representation is required.

17. Inability to Obtain Authority. The inability of the Company to obtain
-----------------------------
authority from any regulatory body having jurisdiction, which authority is
deemed by the Company's counsel to be necessary to the lawful issuance and sale
of any Shares hereunder, shall relieve the Company of any liability in respect
of the failure to issue or sell such Shares as to which such requisite authority
shall not have been obtained.

18. Reservation of Shares. The Company, during the term of this Plan, will
---------------------
at all times reserve and keep available such number of Shares as shall be
sufficient to satisfy the requirements of the Plan.

19. Stockholder Approval. The Plan shall be subject to approval by the
--------------------
stockholders of the Company within twelve (12) months after the date the Plan is
adopted. Such stockholder approval shall be obtained in the manner and to the
degree required under Applicable Laws.

-13-
<PAGE>

TICKETMASTER ONLINE-CITYSEARCH, INC.

1998 STOCK PLAN

STOCK OPTION AGREEMENT

Unless otherwise defined herein, the terms defined in the 1998 Stock Plan
shall have the same defined meanings in this Stock Option Agreement.

I. NOTICE OF STOCK OPTION GRANT
----------------------------

[Optionee's Name and Address]

You have been granted an option to purchase Class B Common Stock of the
Company (the "Common Stock"), subject to the terms and conditions of the Plan
and this Option Agreement, as follows:

Grant Number _________________________

Date of Grant _________________________

Vesting Commencement Date _________________________

Exercise Price per Share $________________________

Total Number of Shares Granted _________________________

Total Exercise Price $_________________________

Type of Option: ___ Incentive Stock Option

___ Nonstatutory Stock Option

Term/Expiration Date: _________________________

Vesting Schedule:
----------------

This Option may be exercised, in whole or in part, in accordance with the
following schedule:

Termination Period:
------------------

This Option may be exercised for three months after Optionee ceases to be a
Service Provider. Upon the death or Disability of the Optionee, this Option may
be exercised for one year after Optionee ceases to be a Service Provider. In no
event shall this Option be exercised later than the Term/Expiration Date as
provided above.

II. AGREEMENT
---------

1. Grant of Option. The Plan Administrator of the Company hereby grants
---------------
to the Optionee named in the Notice of Grant attached as Part I of this
Agreement (the "Optionee") an option (the "Option") to purchase the number of
Shares, as set forth in the Notice of Grant, at the exercise price per share set
forth in the Notice of Grant (the "Exercise Price"), subject to the terms and
conditions of the Plan, which is incorporated herein by reference. Subject to
Section 15(c) of the Plan, in the event of a conflict between the terms and
conditions of the Plan and the terms and conditions of this Option Agreement,
the terms and conditions of the Plan shall prevail.

2. Exercise of Option.
------------------

(b) Method of Exercise. This Option is exercisable by delivery of an
------------------
exercise notice, in the form attached as Exhibit A (the "Exercise Notice"),
which shall state the election to exercise the Option, the number of Shares in
respect of which the Option is being exercised (the "Exercised Shares"), and
such other representations and agreements as may be required by the Company
pursuant to the provisions of the Plan. The Exercise Notice shall be completed
by the Optionee and delivered to [Title] of the Company. The Exercise Notice
shall be accompanied by payment of the aggregate Exercise Price as to all
Exercised Shares. This Option shall be deemed to be exercised upon receipt by
the Company of such fully executed Exercise Notice accompanied by such aggregate
Exercise Price.

No Shares shall be issued pursuant to the exercise of this Option
unless such issuance and exercise complies with Applicable Laws.

-2-
<PAGE>

3. Method of Payment. Payment of the aggregate Exercise Price shall be by
-----------------
any of the following, or a combination thereof, at the election of the Optionee:

(a) cash;

(b) check;

(c) consideration received by the Company under a cashless exercise
program implemented by the Company in connection with the Plan; or

-3-
<PAGE>

6. Entire Agreement; Governing Law. The Plan is incorporated herein by
-------------------------------
reference. The Plan and this Option Agreement constitute the entire agreement
of the parties with respect to the subject matter hereof and supersede in their
entirety all prior undertakings and agreements of the Company and Optionee with
respect to the subject matter hereof, and may not be modified adversely to the
Optionee's interest except by means of a writing signed by the Company and
Optionee. This agreement is governed by the internal substantive laws, but not
the choice of law rules, of Delaware.

-4-
<PAGE>

7. NO GUARANTEE OF CONTINUED SERVICE. OPTIONEE ACKNOWLEDGES AND AGREES
---------------------------------
THAT THE VESTING OF SHARES PURSUANT TO THE VESTING SCHEDULE HEREOF IS EARNED
ONLY BY CONTINUING AS A SERVICE PROVIDER AT THE WILL OF THE COMPANY (AND NOT
THROUGH THE ACT OF BEING HIRED, BEING GRANTED AN OPTION OR PURCHASING SHARES
HEREUNDER). OPTIONEE FURTHER ACKNOWLEDGES AND AGREES THAT THIS AGREEMENT, THE
TRANSACTIONS CONTEMPLATED HEREUNDER AND THE VESTING SCHEDULE SET FORTH HEREIN DO
NOT CONSTITUTE AN EXPRESS OR IMPLIED PROMISE OF CONTINUED ENGAGEMENT AS A
SERVICE PROVIDER FOR THE VESTING PERIOD, FOR ANY PERIOD, OR AT ALL, AND SHALL
NOT INTERFERE WITH OPTIONEE'S RIGHT OR THE COMPANY'S RIGHT TO TERMINATE
OPTIONEE'S RELATIONSHIP AS A SERVICE PROVIDER AT ANY TIME, WITH OR WITHOUT
CAUSE.

By your signature and the signature of the Company's representative below,
you and the Company agree that this Option is granted under and governed by the
terms and conditions of the Plan and this Option Agreement. Optionee has
reviewed the Plan and this Option Agreement in their entirety, has had an
opportunity to obtain the advice of counsel prior to executing this Option
Agreement and fully understands all provisions of the Plan and Option Agreement.
Optionee hereby agrees to accept as binding, conclusive and final all decisions
or interpretations of the Administrator upon any questions relating to the Plan
and Option Agreement. Optionee further agrees to notify the Company upon any
change in the residence address indicated below.

OPTIONEE: TICKETMASTER ONLINE-CITYSEARCH,
INC.

_______________________________ _________________________________________
Signature By

_______________________________ ______________________________________
Print Name Title

_______________________________
Residence Address

_______________________________

-5-
<PAGE>

EXHIBIT A
---------

1998 STOCK PLAN

EXERCISE NOTICE

Ticketmaster Online-CitySearch, Inc.
790 E. Colorado Blvd., Suite 200
Pasadena, CA 91101

Attention: Secretary

1. Exercise of Option. Effective as of today, ________________, 199__,
------------------
the undersigned ("Purchaser") hereby elects to purchase ______________ shares
(the "Shares") of the Class B Common Stock (the "Common Stock") of Ticketmaster
Online-CitySearch, Inc. (the "Company") under and pursuant to the 1998 Stock
Plan (the "Plan") and the Stock Option Agreement dated ____________, 19___ (the
"Option Agreement"). The purchase price for the Shares shall be $_____________,
as required by the Option Agreement.

2. Delivery of Payment. Purchaser herewith delivers to the Company the
-------------------
full purchase price for the Shares.

6. Entire Agreement; Governing Law. The Plan and Option Agreement are
-------------------------------
incorporated herein by reference. This Agreement, the Plan and the Option
Agreement constitute the entire agreement of the parties with respect to the
subject matter hereof and supersede in their entirety all
<PAGE>

prior undertakings and agreements of the Company and Purchaser with respect to
the subject matter hereof, and may not be modified adversely to the Purchaser's
interest except by means of a writing signed by the Company and Purchaser. This
agreement is governed by the internal substantive laws, but not the choice of
law rules, of Delaware.

Submitted by: Accepted by:

PURCHASER: TICKETMASTER ONLINE-
CITYSEARCH, INC.

______________________________ _________________________________
Signature By

______________________________ _________________________________
Print Name Its

Address: Address:
- ------- -------

_________________________________ 790 E. Colorado Blvd., Suite 200
_________________________________ Pasadena, CA 91101

_____________________________________
Date Received

-2-

<PAGE>

EXHIBIT 23.1

CONSENT OF INDEPENDENT AUDITORS

We consent to the reference to our firm under the captions "Experts" and
"Selected Historical Financial Data" and to the use of our report dated
September 3, 1998 with respect to the financial statements of Ticketmaster
Multimedia Holdings, Inc., included in the Registration Statement Form S-1 and
related Prospectus of Ticketmaster Online-CitySearch, Inc. dated November 6,
1998.

/s/ Ernst & Young LLP

Los Angeles, California

November 5, 1998

<PAGE>

EXHIBIT 23.2

CONSENT OF INDEPENDENT AUDITORS

We consent to the reference to our firm under the captions "Experts" and
"Selected Historical Financial Data" and to the use of our report dated March
11, 1998 (except Note 10, as to which the date is September 28, 1998), in the
Registration Statement Form S-1 and related Prospectus of Ticketmaster Online-
CitySearch, Inc. dated November 6, 1998.

Our audit also included the financial statement schedule of CitySearch, Inc.
listed in Item 16(b). The schedule is the responsibility of the Company's
management. Our responsibility is to express an opinion on the schedule based
on our audit. In our opinion, the financial statement schedule referred to
above, when considered in relation to the basic financial statements taken as
a whole, presents fairly in all material respects the information set forth
therein.

/s/ Ernst & Young LLP

Los Angeles, California

November 5, 1998