TICKETMASTER ONLINE CITYSEARCH INC, S-1/A, 1998-11-20

TICKETMASTER ONLINE CITYSEARCH INC
S-1/A, 1998-11-20
COMPUTER PROCESSING & DATA PREPARATION

Previous: LUCENT TECHNOLOGIES INC, 424B3, 1998-11-20

Next: GLENBROOK LIFE MULTI-MANAGER VARIABLE ACCOUNT, 497, 1998-11-20

<PAGE>

AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON NOVEMBER 20, 1998
REGISTRATION NO. 333-64855
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

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

AMENDMENT NO. 3 TO
FORM S-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933

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

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

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

<TABLE>
<S> <C> <C>
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>

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

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)

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

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)

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

COPIES TO:

<TABLE>
<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
</TABLE>

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

APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon as
practicable after the effective date of this Registration Statement.

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

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. [_]

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

CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
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
- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class B Common Stock
$0.01 par value....... 8,050,000 $10.00 $80,500,000 $22,379 (3)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
</TABLE>
(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.

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

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.

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

++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+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 20, 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. The Class B Common Stock has been 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.

-----------

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.

<TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<CAPTION>
Price Proceeds
to Underwriting to
Public Discount(1) Company(2)
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
Per Share........................................ $ $ $
Total(3)......................................... $ $ $
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
</TABLE>
(1) See "Underwriting" for information concerning indemnification of the
Underwriters and other matters.

(2) Before deducting offering expenses estimated at $1,400,000. 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.

-----------

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

, 1998
<PAGE>

[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.

<PAGE>

[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.]
<PAGE>

[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.]
<PAGE>

(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 November
4, 1998, 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."
<PAGE>

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 43 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 do business under the name "CitySearch."

3
<PAGE>

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

4
<PAGE>

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.

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

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

5
<PAGE>

converted into Class A Common Stock of the Company. In addition, all
outstanding warrants and options 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 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."

The following charts illustrate generally the equity ownership and voting
power relationship, before and after the Merger, of each entity party to the
Merger, without giving effect to this offering. Unless indicated otherwise, the
percentages are based on shares issued and outstanding at each respective time
and represent the equity ownership and voting power percentage in the indicated
entity.

[CHART] [CHART]

6
<PAGE>

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."

THE OFFERING

<TABLE>
<S> <C>
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
5,000,000 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."

7
<PAGE>

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."

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
present 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 56,084
Total assets(4)................................... 360,954 384,344
Long-term obligations, less current portion....... 52,320 2,320
Stockholders' equity(4)........................... 297,150 371,540
</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 reflect 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
------------ -------------
<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.......................... 47,712 35,784
Merger and other transactions costs............... -- 3,101
-------- --------
Total costs and expenses........................ 96,051 84,053
-------- --------
Loss from operations............................... (80,572) (57,498)
Interest income, net............................... 223 696
-------- --------
Loss before provision for income taxes............. (80,349) (56,802)
Provision for income taxes......................... 8 --
-------- --------
Net loss........................................... $(80,357) $(56,802)
======== ========
Basic and diluted net loss per share............... $ (1.44) $ (0.92)
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 $330,000 for the eight months ended September 30, 1998, and generated net
income of $2.3 million for the year ended January 31, 1998. 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 2008, and $160.7 million of which related
directly to the Merger and the Tender Offer and is to be amortized through
2003. 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

16
<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."

17
<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

18
<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. Specifically, the
turnover rate has been higher than expected due to several factors, including
the Company's early belief that its services would be suited to a broader base
of business customers, the challenges of proving advertising value to a broad
range of small businesses that may not have significant experience with online
services, the Company's continuing refinements to its sales, production and
customer service processes to meet the needs of its business customers, and
the Company's initial underestimation of the need for continuous marketing
support of its business customers. 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.

19
<PAGE>

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 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

20
<PAGE>

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 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

21
<PAGE>

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 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

22
<PAGE>

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 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 16% 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 15% 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

23
<PAGE>

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 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. Ticketmaster Corp. is a
leading provider of live event automated ticketing services in the United
States, with over 3,000 clients, and has a widely recognized brand name in the
live event ticketing business. The Company believes that its right to act as
Ticketmaster Corp.'s exclusive agent for online live event ticket sales with
the exclusive, worldwide right to use the Ticketmaster trademark for such
online sales will enable it to compete effectively with other online ticketing
services. However, 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 Ticketmaster Corp.'s and Ticketmaster
Online's 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. In addition, 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.

24
<PAGE>

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 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

25
<PAGE>

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.

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

26
<PAGE>

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 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

27
<PAGE>

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 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

28
<PAGE>

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 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

29
<PAGE>

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 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

30
<PAGE>

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. 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 be 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

31
<PAGE>

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 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.

32
<PAGE>

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 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

33
<PAGE>

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 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, 2,484,084 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 (based on shares outstanding as of November 4, 1998) 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 5,000,000 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 $57,190,000 ($65,978,500 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............................... 625 625
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................................... -- 70
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............................. 295,453 369,773
Retained earnings...................................... 1,072 1,072
-------- --------
Total stockholders' equity(3).......................... 297,150 371,540
-------- --------
Total capitalization............................... $349,470 $373,860
======== ========
</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 5,000,000 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
5,000,000 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.............. -- -- -- -- 4,027
------ ------ ------ ------ ------
Total costs and expenses............. 548 2,185 5,731 3,346 11,734
------ ------ ------ ------ ------
Income (loss) from operations.......... (534) (989) 4,174 2,477 2,536
Interest expense, net.................. -- -- -- -- (1)
------ ------ ------ ------ ------
Income (loss) before income taxes...... (534) (989) 4,174 2,477 2,535
Income tax provision (benefit)......... (204) (374) 1,827 1,089 2,865
------ ------ ------ ------ ------
Net income (loss)...................... $ (330) $ (615) $2,347 $1,388 $ (330)
====== ====== ====== ====== ======
Basic and diluted net income (loss) per
equivalent share(3)................... $(0.01) $(0.02) $ 0.06 $ 0.04 $(0.01)
====== ====== ====== ====== ======
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)................................. 354 554 688 360,954
Long-term obligations, less current portion..... -- -- -- 52,320
Stockholders' equity(6)......................... 354 489 289 297,150
</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.......................... 47,712 35,784
Merger and other transactions costs............... -- 3,101
-------- --------
Total costs and expenses........................ 96,051 84,053
-------- --------
Loss from operations............................... (80,572) (57,498)
Interest income, net............................... 223 696
-------- --------
Loss before provision for income taxes............. (80,349) (56,802)
Provision for income taxes......................... 8 --
-------- --------
Net loss........................................... $(80,357) $(56,802)
======== ========
Basic and diluted net loss per share............... $ (1.44) $ (0.92)
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 for the year ended January 31, 1998 and
incurred net losses of $330,000 for the eight months ended September 30, 1998.
At September 30, 1998, Ticketmaster Online had retained earnings of $1.1
million.

Goodwill

The Merger and the Tender Offer resulted in $160.2 million of goodwill that
will be amortized over five 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 ten 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 convenience charge 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 months 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............. -- -- -- -- -- -- 4,027
-------- -------- -------- -------- -------- -------- --------
Total costs and
expenses........... 930 1,227 1,399 1,843 2,117 2,811 7,480
-------- -------- -------- -------- -------- -------- --------
Income (loss) from
operations ............ 340 1,397 915 1,244 1,037 2,426 (633)
Interest expense, net .. -- -- -- -- -- -- (1)
-------- -------- -------- -------- -------- -------- --------
Income (loss) before
provision for income
taxes.................. 340 1,397 915 1,244 1,037 2,426 (634)
Provision for income
taxes.................. 149 612 401 545 452 1,059 1,482
-------- -------- -------- -------- -------- -------- --------
Net income (loss)..... $ 191 $ 785 $ 514 $ 699 $ 585 $ 1,367 $ (2,116)
======== ======== ======== ======== ======== ======== ========

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)

<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............. 11,928 11,928 11,928 11,928 11,928 11,927 11,929
Merger and other
transactions costs... -- -- -- -- 100 379 2,622
-------- -------- -------- -------- -------- -------- --------
Total costs and
expenses........... 22,354 23,165 24,245 26,287 25,392 27,474 31,187
-------- -------- -------- -------- -------- -------- --------
Loss from operations.... (20,614) (19,503) (19,776) (20,679) (19,147) (18,530) (19,821)
Interest income, net.... 84 20 -- 119 173 87 436
-------- -------- -------- -------- -------- -------- --------
Loss before provision
for income taxes....... (20,530) (19,483) (19,776) (20,560) (18,974) (18,443) (19,385)
Provision for income
taxes.................. -- -- -- 8 -- -- --
-------- -------- -------- -------- -------- -------- --------
Net loss................ $(20,530) $(19,483) $(19,776) $(20,568) $(18,974) $(18,443) $(19,385)
======== ======== ======== ======== ======== ======== ========
</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 months ended September 30, 1997 and 1998, respectively, and was
$146,000, $189,000 and $250,000 for the fiscal years ended 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 43 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 43 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.

58
<PAGE>

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

59
<PAGE>

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

60
<PAGE>

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

61
<PAGE>

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

62
<PAGE>

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 October 1998, the message boards within the Company's owned and
operated city guide sites received over 285,000 page views and over 18,000
individual "posts" of information by consumers. As of November 11, 1998, the
Company's owned and operated city guide sites contained approximately 1,500
"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.

63
<PAGE>

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
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.

64
<PAGE>

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.

65
<PAGE>

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.

66
<PAGE>

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

67
<PAGE>

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.

68
<PAGE>

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

69
<PAGE>

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

70
<PAGE>

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.

71
<PAGE>

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

72
<PAGE>

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 nine months ended September 30,
1998 (i.e., accounting for 16% 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 15% 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.

73
<PAGE>

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. Ticketmaster Corp. is a leading provider of live
event automated ticketing services in the United States, with over 3,000
clients, and has a widely recognized brand name in the live event ticketing
business. The Company believes that its right to act as Ticketmaster Corp.'s
exclusive agent for online live event ticket sales with the exclusive,
worldwide right to use the Ticketmaster trademark for such online sales will
enable it to compete effectively with other online ticketing services.
However, 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 Ticketmaster Corp.'s and Ticketmaster
Online's 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. In addition, 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

74
<PAGE>

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 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.

75
<PAGE>

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.

76
<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 has 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

78
<PAGE>

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. 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

The Board of Directors has a Compensation Committee, comprised of Messrs.
Kavner and Unterman, with Mr. Citron serving as an observer to such Committee.
Neither of the members of the Compensation Committee is an officer or employee
of the Company. No interlocking relationship exists 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.

79
<PAGE>

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.

In addition, 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 The Los Angeles Times, Inc. 50% of net merchandising revenue
from the co-branded Web site.

Mr. Unterman, a director of the Company, is Executive Vice President and
Chief Financial Officer of The Times Mirror Company.

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."

80
<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.

81
<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 2,268,750 481,250
</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.

82
<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.

83
<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 1,000,000 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 2000 by an
amount equal to (i) 200,000 shares of Class B Common Stock or (ii) 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 under
the Purchase Plan will run for six months, other than the initial offering
period, which will commence on the date of this Prospectus and end on August
14, 1999. Thereafter, new six-month offering periods will commence each
February 15 and August 15.

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 offering 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 on the relevant purchase date.
Shares purchased under the Purchase Plan generally may not be sold or
otherwise disposed of for 180 days after their date of purchase. 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 offering period is 2,000 shares. 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 of all classes of the
capital stock of the Company or any of its subsidiaries or its parent
corporation, or to the extent that such person's rights to purchase stock
under all employee stock purchase plans would accrue at a rate which exceeded
$25,000 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.

84
<PAGE>

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 to purchase Class B Common Stock 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, the
offering period 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. No such Board action may adversely affect any
outstanding options to purchase Class B Common Stock under the Purchase Plan
unless the ongoing operation of the Purchase Plan would result in unfavorable
accounting consequences to the Company.

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).

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

85
<PAGE>

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.

86
<PAGE>

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 9.7 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 83.7 83.1
</TABLE>
- --------

* 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 (including 70,000 shares of Class A Common Stock
that are owned by Mr. Kavner (60,000 shares) and Mr. Conn (10,000
shares)). 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!.

(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 (including 70,000 shares of Class A Common Stock
that are owned by Mr. Kavner (60,000 shares) and Mr. Conn (10,000
shares)). 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!.

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.

90
<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.

92
<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

93
<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."

94
<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 4,714,286 shares of Series E Preferred Stock (or 4,655,347
shares of Class A Common Stock pursuant to the Conversion and the
Reclassification) 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.

95
<PAGE>

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

96
<PAGE>

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."

97
<PAGE>

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."

98
<PAGE>

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.

99
<PAGE>

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

100
<PAGE>

(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

101
<PAGE>

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
(based on shares outstanding as of November 4, 1998) 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.

102
<PAGE>

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, 2,484,084 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 5,000,000 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

103
<PAGE>

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.

104
<PAGE>

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...................... 294,228 17,200 (1) 311,428
-------- ------- --------
Total assets............... $360,954 $17,200 $378,154
======== ======= ========
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............ 1,072 -- 1,072
-------- ------- --------
Total stockholders' equity..... 297,150 17,200 314,350
-------- ------- --------
Total liabilities and
stockholders' equity........ $360,954 $17,200 $378,154
======== ======= ========
</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............. 4,027 7,739 (2) 11,766 -- 24,018 (5) 35,784
Merger and other
transactions costs... -- -- -- 3,101 -- 3,101
------- ------- ------- -------- -------- --------
12,408 7,739 20,147 38,598 25,308 84,053
------- ------- ------- -------- -------- --------
Income (loss) from
operations............. 2,830 (7,739) (4,909) (27,281) (25,308) (57,498)
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.................. 2,829 (7,739) (4,910) (27,054) (24,838) (56,802)
Provision for income
taxes.................. 2,993 -- 2,993 -- (2,993)(7) --
------- ------- ------- -------- -------- --------
Net income (loss)....... $ (164) $(7,739) $(7,903) $(27,054) $(21,845) $(56,802)
======= ======= ======= ======== ======== ========
Basic and diluted net
loss per share......... $ (2.73) $ (0.92)
======== ========
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............. -- 15,479(2) 15,479 -- 32,233 (5) 47,712
------ -------- -------- -------- -------- --------
5,399 15,479 20,878 42,925 32,248 96,051
------ -------- -------- -------- -------- --------
Income (loss) from
operations............. 3,896 (15,479) (11,583) (36,741) (32,248) (80,572)
Interest income......... -- -- -- 494 -- 494
Interest expense........ -- -- -- (271) -- (271)
------ -------- -------- -------- -------- --------
-- -- -- 223 -- 223
------ -------- -------- -------- -------- --------
Income (loss) before
provision for income
taxes.................. 3,896 (15,479) (11,583) (36,518) (32,248) (80,349)
Provision for income
taxes.................. 1,707 -- 1,707 8 (1,707)(7) 8
------ -------- -------- -------- -------- --------
Net income (loss)....... $2,189 $(15,479) $(13,290) $(36,526) $(30,541) $(80,357)
====== ======== ======== ======== ======== ========
Basic and diluted net
loss per share......... $ (3.86) $ (1.44)
======== ========
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 ten
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.)

(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

five 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........... -- -- 294,228
------ ------- --------
Total assets................................ $ 554 $ 688 $360,954
====== ======= ========
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 1,072
------ ------- --------
Total stockholders' equity.................. 489 289 297,150
------ ------- --------
Total liabilities and stockholders' equity.. $ 554 $ 688 $360,954
====== ======= ========
</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......... -- -- -- -- 4,027
------ ------ ------ --------- ---------
Total costs and expenses....... 548 2,185 5,731 3,346 11,734
------ ------ ------ --------- ---------
Income (loss) from operations...... (534) (989) 4,174 2,477 2,536
Interest income.................... -- -- -- -- 21
Interest expense................... -- -- -- -- (22)
------ ------ ------ --------- ---------
-- -- -- -- (1)
------ ------ ------ --------- ---------
Income (loss) before income taxes.. (534) (989) 4,174 2,477 2,535
Income tax provision (benefit)..... (204) (374) 1,827 1,089 2,865
------ ------ ------ --------- ---------
Net income (loss).................. $ (330) $ (615) $2,347 $ 1,388 $ (330)
====== ====== ====== ========= =========
Basic and dilutive net income
(loss) per equivalent share....... $(0.01) $(0.02) $ 0.06 $ 0.04 $ (0.01)
====== ====== ====== ========= =========
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 loss (unaudited).... -- -- -- -- -- -- (330) (330)
--- ---- ------ ---- ------- -------- ------ --------
Balance at
September 30, 1998
(unaudited).......... -- $ -- 62,486 $625 $ -- $295,453 $1,072 $297,150
=== ==== ====== ==== ======= ======== ====== ========
</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 $ (330)
Adjustments to reconcile net
income (loss) to net cash
provided by (used in) operating
activities:
Depreciation and amortization.. 15 51 268 171 4,388
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.). Ticketmaster Corp. is a wholly owned
subsidiary of Ticketmaster Group.

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................................. $ (80,357) $ (56,802)
Net loss per share....................... $ (1.44) $ (0.92)
</TABLE>

Goodwill of $294.2 million and Stockholders' Equity of $297.2 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 $311.2 million and $314.4 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

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)

common 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 ten 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 five 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 five 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.

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>
$0.10 to
0.25 1,206 $0.13 8.18 885 $0.12
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.

** Filed herewith.
*** 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 20TH 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 20, 1998
- ------------------------------------
CHARLES CONN (Principal Executive
Officer)

/s/ Bradley Ramberg Chief Financial Officer and November 20, 1998
- ------------------------------------
BRADLEY RAMBERG Vice President, Finance and
Administration and
Secretary (Principal
Financial Officer and
Principal Accounting
Officer)

* Director November 20, 1998
- ------------------------------------
TERRY BARNES

* Director November 20, 1998
- ------------------------------------
ALAN CITRON

* Director November 20, 1998
- ------------------------------------
EUGENE L. COBUZZI

* Director November 20, 1998
- ------------------------------------
STUART W. DEPINA

* Director November 20, 1998
____________________________________
BARRY DILLER

* Director November 20, 1998
- ------------------------------------
JOSEPH GLEBERMAN

</TABLE>

II-6
<PAGE>

<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<S> <C> <C>
* Director November 20, 1998
- ------------------------------------
WILLIAM GROSS

* Director November 20, 1998
- ------------------------------------
VICTOR A. KAUFMAN

* Director November 20, 1998
- ------------------------------------
ROBERT KAVNER

* Director November 20, 1998
- ------------------------------------
WILLIAM D. SAVOY

* Director November 20, 1998
- ------------------------------------
ALAN SPOON

* Director November 20, 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.

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

<PAGE>

EXHIBIT 10.4

TICKETMASTER ONLINE-CITYSEARCH, INC.

1998 EMPLOYEE STOCK PURCHASE PLAN

The following constitute the provisions of the 1998 Employee Stock Purchase
Plan of Ticketmaster Online-CitySearch, Inc.

1. Purpose. The purpose of the Plan is to provide employees of the
-------
Company and its Designated Subsidiaries with an opportunity to purchase Class B
Common Stock of the Company through accumulated payroll deductions. It is the
intention of the Company to have the Plan qualify as an "Employee Stock Purchase
Plan" under Section 423 of the Internal Revenue Code of 1986, as amended. The
provisions of the Plan, accordingly, shall be construed so as to extend and
limit participation in a manner consistent with the requirements of that section
of the Code.

2. Definitions.
-----------

(a) "Board" shall mean the Board of Directors of the Company.
-----

(b) "Code" shall mean the Internal Revenue Code of 1986, as amended.
----

(d) "Company" shall mean Ticketmaster Online-CitySearch, Inc., and any
-------
Designated Subsidiary of the Company.

(e) "Compensation" shall mean all base straight time gross earnings
------------
and commissions, exclusive of payments for overtime, shift premium, incentive
compensation, incentive payments, bonuses and other compensation.

(f) "Designated Subsidiary" shall mean any Subsidiary which has been
---------------------
designated by the Board from time to time in its sole discretion as eligible to
participate in the Plan.

(g) "Employee" shall mean any individual who is an Employee of the
--------
Company for tax purposes whose customary employment with the Company is at least
twenty (20) hours per week and more than five (5) months in any calendar year.
For purposes of the Plan, the employment relationship shall be treated as
continuing intact while the individual is on sick leave or other leave of
absence approved by the Company. Where the period of leave exceeds 90 days and
the individual's right to reemployment is not guaranteed either by statute or by
contract, the employment relationship shall be deemed to have terminated on the
91st day of such leave.

(h) "Enrollment Date" shall mean the first Trading Day of each
---------------
Offering Period.

(i) "Exercise Date" shall mean the last Trading Day of each Offering
-------------
Period.

(j) "Fair Market Value" shall mean, as of any date, the value of
-----------------
Common Stock determined as follows:
<PAGE>

(1) 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 date of such determination, (or if there were no trades on the date of
determination then for the last market trading day prior to the date of
determination), as reported in The Wall Street Journal or such other source as
the Board deems reliable, or;

(2) 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 of the closing bid and asked prices for the Common Stock on
the date of such determination, (or the closing bid, if no sales were reported)
as quoted on such exchange or system for the date of such determination, (or if
there were no trades on the date of determination then for the last market
trading day prior to the date of determination), as reported in The Wall Street
Journal or such other source as the Board deems reliable, or;

(3) In the absence of an established market for the Common Stock,
the Fair Market Value thereof shall be determined in good faith by the Board.

(k) "Holding Period" shall mean that period of time beginning on an
--------------
Exercise Date on which shares are purchased by participants under the Plan and
ending 180 days thereafter.

(l) "Offering Period" shall mean a period of approximately six (6)
---------------
months during which an option granted pursuant to the Plan may be exercised,
commencing on the first Trading Day on or after February 15 and August 15 of
each year and terminating on the last Trading Day in the periods ending six (6)
months later; provided, however, that the first Offering Period under the Plan
shall commence with the first Trading Day on or after the date on which the
Securities and Exchange Commission declares the Company's Registration Statement
effective and ending on the last Trading Day on or before August 14, 1999. The
duration of Offering Periods may be changed pursuant to Section 4 of this Plan.

(m) "Parent" shall mean a " parent corporation," whether now or
------
hereafter existing, as defined in Section 424(e) of the Code.

(n) "Plan" shall mean this 1998 Employee Stock Purchase Plan.
----

(o) "Purchase Price" shall mean an amount equal to 85% of the Fair
--------------
Market Value of a share of Common Stock on the Exercise Date; provided, however,
that the Purchase Price may be adjusted by the Board pursuant to Section 20.

(p) "Reserves" shall mean the number of shares of Common Stock covered
--------
by each option under the Plan which have not yet been exercised and the number
of shares of Common Stock which have been authorized for issuance under the Plan
but not yet placed under option.

-2-
<PAGE>

(q) "Subsidiary" shall mean a "subsidiary corporation," whether now or
----------
hereafter existing, as defined in Section 424(f) of the Code.

(r) "Trading Day" shall mean a day on which national stock exchanges
-----------
and the Nasdaq System are open for trading.

3. Eligibility.
-----------

(a) Any Employee who shall be employed by the Company on a given
Enrollment Date shall be eligible to participate in the Plan.

(b) Any provisions of the Plan to the contrary notwithstanding, no
Employee shall be granted an option under the Plan (i) to the extent that,
immediately after the grant, such Employee (or any other person whose stock
would be attributed to such Employee pursuant to Section 424(d) of the Code)
would own capital stock of the Company and/or hold outstanding options to
purchase such stock possessing five percent (5%) or more of the total combined
voting power or value of all classes of the capital stock of the Company or of
any Subsidiary or of its Parent, or (ii) to the extent that his or her rights to
purchase stock under all employee stock purchase plans of the Company, its
Parent, and its Subsidiaries accrues at a rate which exceeds Twenty-Five
Thousand Dollars ($25,000) worth of stock (determined at the fair market value
of the shares at the time such option is granted) for each calendar year in
which such option is outstanding at any time.

4. Offering Periods. The Plan shall be implemented by consecutive
----------------
Offering Periods with a new Offering Period commencing on the first Trading Day
on or after February 15 and August 15 each year, or on such other date as the
Board shall determine, and continuing thereafter until terminated in accordance
with Section 20 hereof; provided, however, that the first Offering Period under
the Plan shall commence with the first Trading Day on or after the date on which
the Securities and Exchange Commission declares the Company's Registration
Statement effective and ending on the last Trading Day on or before August 14,
1999. The Board shall have the power to change the duration of Offering Periods
(including the commencement dates thereof) with respect to future offerings
without stockholder approval if such change is announced prior to the scheduled
beginning of the first Offering Period to be affected thereafter.

5. Participation.
-------------

(a) An eligible Employee may become a participant in the Plan by
completing a subscription agreement authorizing payroll deductions in the form
of Exhibit A to this Plan and filing it with the Company's payroll office prior
to the applicable Enrollment Date.

(b) Payroll deductions for a participant shall commence on the first
payroll following the Enrollment Date and shall end on the last payroll in the
Offering Period to which such authorization is applicable, unless sooner
terminated by the participant as provided in Section 10 hereof.

-3-
<PAGE>

6. Payroll Deductions.
------------------

(a) At the time a participant files his or her subscription agreement,
he or she shall elect to have payroll deductions made on each pay day during the
Offering Period in an amount not exceeding fifteen percent (15%) of the
Compensation which he or she receives on each pay day during the Offering
Period.

(b) All payroll deductions made for a participant shall be credited to
his or her account under the Plan and shall be withheld in whole percentages
only. A participant may not make any additional payments into such account.

(c) A participant may discontinue his or her participation in the Plan
as provided in Section 10 hereof, or may increase or decrease the rate of his or
her payroll deductions during the Offering Period by completing or filing with
the Company a new subscription agreement authorizing a change in payroll
deduction rate. The Board may, in its discretion, limit the number of parti
cipation rate changes during any Offering Period. The change in rate shall be
effective with the first full payroll period following five (5) business days
after the Company's receipt of the new subscription agreement unless the Company
elects to process a given change in participation more quickly. A participant's
subscription agreement shall remain in effect for successive Offering Periods
unless terminated as provided in Section 10 hereof.

(d) Notwithstanding the foregoing, to the extent necessary to comply
with Section 423(b)(8) of the Code and Section 3(b) hereof, a participant's
payroll deductions may be decreased to zero percent (0%) at any time during an
Offering Period. Payroll deductions shall recommence at the rate provided in
such participant's subscription agreement at the beginning of the first Offering
Period which is scheduled to end in the following calendar year, unless
terminated by the participant as provided in Section 10 hereof.

(e) At the time the option is exercised, in whole or in part, or at
the time some or all of the Company's Common Stock issued under the Plan is
disposed of, the participant must make adequate provision for the Company's
federal, state, or other tax withholding obligations, if any, which arise upon
the exercise of the option or the disposition of the Common Stock. At any time,
the Company may, but shall not be obligated to, withhold from the participant's
compensation the amount necessary for the Company to meet applicable withholding
obligations, including any withholding required to make available to the Company
any tax deductions or benefits attributable to sale or early disposition of
Common Stock by the Employee.

7. Grant of Option. On the Enrollment Date of each Offering Period, each
---------------
eligible Employee participating in such Offering Period shall be granted an
option to purchase on the Exercise Date of such Offering Period (at the
applicable Purchase Price) up to a number of shares of the Company's Common
Stock determined by dividing such Employee's payroll deductions accumulated
prior to such Exercise Date and retained in the Participant's account as of the
Exercise Date by the Purchase Price; provided that in no event shall an Employee
be permitted to purchase during each Offering Period more than 2,000 shares
(subject to any adjustment pursuant to

-4-
<PAGE>

Section 19), and provided further that such purchase shall be subject to the
limitations set forth in Sections 3(b) hereof. The Board may, for future
Offering Periods, increase or decrease, in its absolute discretion, the maximum
number of shares of the Company's Common Stock an Employee may purchase during
each Offering Period. Exercise of the option shall occur as provided in Section
8 hereof, unless the participant has withdrawn pursuant to Section 10 hereof.
The option shall expire on the last day of the Offering Period.

8. Exercise of Option.
------------------

(a) Unless a participant withdraws from the Plan as provided in
Section 10 hereof, his or her option for the purchase of shares shall be
exercised automatically on the Exercise Date, and the maximum number of full
shares subject to option shall be purchased for such participant at the Purchase
Price with the accumulated payroll deductions in his or her account. No
fractional shares shall be purchased; any payroll deductions accumulated in a
participant's account which are not sufficient to purchase a full share shall be
retained in the participant's account for the subsequent Offering Period,
subject to earlier withdrawal by the participant as provided in Section 10
hereof. Any other monies left over in a participant's account after the Exercise
Date shall be returned to the participant. During a participant's lifetime, a
participant's option to purchase shares hereunder is exercisable only by him or
her.

(b) Subject to Section 20(c), if the Board determines that, on a
given Exercise Date, the number of shares with respect to which options are to
be exercised may exceed (i) the number of shares of Common Stock that were
available for sale under the Plan on the Enrollment Date of the applicable
Offering Period, or (ii) the number of shares available for sale under the Plan
on such Exercise Date, the Board may in its sole discretion (x) provide that the
Company shall make a pro rata allocation of the shares of Common Stock available
for purchase on such Enrollment Date or Exercise Date, as applicable, in as
uniform a manner as shall be practicable and as it shall determine in its sole
discretion to be equitable among all participants exercising options to purchase
Common Stock on such Exercise Date, and continue all Offering Periods then in
effect, or (y) provide that the Company shall make a pro rata allocation of the
shares available for purchase on such Enrollment Date or Exercise Date, as
applicable, in as uniform a manner as shall be practicable and as it shall
determine in its sole discretion to be equitable among all participants
exercising options to purchase Common Stock on such Exercise Date, and terminate
any or all Offering Periods then in effect pursuant to Section 20 hereof. The
Company may make pro rata allocation of the shares available on the Enrollment
Date of any applicable Offering Period pursuant to the preceding sentence,
notwithstanding any authorization of additional shares for issuance under the
Plan by the Company's stockholders subsequent to such Enrollment Date.

9. Delivery. As promptly as practicable after each Exercise Date on
--------
which a purchase of shares occurs, the Company shall arrange the delivery to
each participant, as appropriate, the shares purchased upon exercise of his or
her option; provided, however, that the transferability of such shares out of
Participant's account will be restricted during the Holding Period pursuant to
Section 25.

-5-
<PAGE>

10. Withdrawal.
----------

(a) A participant may withdraw all but not less than all the payroll
deductions credited to his or her account and not yet used to exercise his or
her option under the Plan at any time by giving written notice to the Company in
the form of Exhibit B to this Plan. All of the participant's payroll deductions
credited to his or her account shall be paid to such participant promptly after
receipt of notice of withdrawal and such participant's option for the Offering
Period shall be automatically terminated, and no further payroll deductions for
the purchase of shares shall be made for such Offering Period. If a participant
withdraws from an Offering Period, payroll deductions shall not resume at the
beginning of the succeeding Offering Period unless the participant delivers to
the Company a new subscription agreement.

(b) A participant's withdrawal from an Offering Period shall not have
any effect upon his or her eligibility to participate in any similar plan which
may hereafter be adopted by the Company or in succeeding Offering Periods which
commence after the termination of the Offering Period from which the participant
withdraws.

11. Termination of Employment. Upon a participant's ceasing to be an
-------------------------
Employee for any reason, he or she shall be deemed to have elected to withdraw
from the Plan and the payroll deductions credited to such participant's account
during the Offering Period but not yet used to exercise the option shall be
returned to such participant or, in the case of his or her death, to the person
or persons entitled thereto under Section 15 hereof, and such participant's
option shall be automatically terminated. The preceding sentence
notwithstanding, a participant who receives payment in lieu of notice of
termination of employment shall be treated as continuing to be an Employee for
the participant's customary number of hours per week of employment during the
period in which the participant is subject to such payment in lieu of notice.

12. Interest. No interest shall accrue on the payroll deductions of a
--------
participant in the Plan.

13. Stock.
-----

(a) Subject to adjustment upon changes in capitalization of the
Company as provided in Section 19 hereof, the maximum number of shares of the
Company's Common Stock which shall be made available for sale under the Plan
shall be 1,000,000 shares, plus an annual increase to be added on the first day
of each fiscal year of the Company beginning in 2000 equal to 200,000 shares, or
a lesser amount determined by the Board.

(b) The participant shall have no interest or voting right in shares
covered by his option until such option has been exercised.

(c) Shares to be delivered to a participant under the Plan shall be
registered in the name of the participant or in the name of the participant and
his or her spouse.

-6-
<PAGE>

14. Administration. The Plan shall be administered by the Board or a
--------------
committee of members of the Board appointed by the Board. The Board or its
committee shall have full and exclusive discretionary authority to construe,
interpret and apply the terms of the Plan, to determine eligibility and to
adjudicate all disputed claims filed under the Plan. Every finding, decision
and determination made by the Board or its committee shall, to the full extent
permitted by law, be final and binding upon all parties.

15. Designation of Beneficiary.
--------------------------

(a) A participant may file a written designation of a beneficiary who
is to receive any shares and cash, if any, from the participant's account under
the Plan in the event of such parti cipant's death subsequent to an Exercise
Date on which the option is exercised but prior to delivery to such participant
of such shares and cash. In addition, a participant may file a written
designation of a beneficiary who is to receive any cash from the participant's
account under the Plan in the event of such participant's death prior to
exercise of the option. If a participant is married and the designated
beneficiary is not the spouse, spousal consent shall be required for such
designation to be effective.

(b) Such designation of beneficiary may be changed by the participant
at any time by written notice. In the event of the death of a participant and
in the absence of a beneficiary validly designated under the Plan who is living
at the time of such participant's death, the Company shall deliver such shares
and/or cash to the executor or administrator of the estate of the participant,
or if no such executor or administrator has been appointed (to the knowledge of
the Company), the Company, in its discretion, may deliver such shares and/or
cash to the spouse or to any one or more dependents or relatives of the
participant, or if no spouse, dependent or relative is known to the Company,
then to such other person as the Company may designate.

16. Transferability. Neither payroll deductions credited to a
---------------
participant's account nor any rights with regard to the exercise of an option or
to receive shares under the Plan may be assigned, transferred, pledged or
otherwise disposed of in any way (other than by will, the laws of descent and
distribution or as provided in Section 15 hereof) by the participant. Any such
attempt at assignment, transfer, pledge or other disposition shall be without
effect, except that the Company may treat such act as an election to withdraw
funds from an Offering Period in accordance with Section 10 hereof.

17. Use of Funds. All payroll deductions received or held by the Company
------------
under the Plan may be used by the Company for any corporate purpose, and the
Company shall not be obligated to segregate such payroll deductions.

18. Reports. Individual accounts shall be maintained for each participant
-------
in the Plan. Statements of account shall be given to participating Employees at
least annually, which statements shall set forth the amounts of payroll
deductions, the Purchase Price, the number of shares purchased and the remaining
cash balance, if any.

-7-
<PAGE>

19. Adjustments Upon Changes in Capitalization, Dissolution, Liquidation,
----------------------------------------------------------------------
Merger or Asset Sale.
--------------------

(a) Changes in Capitalization. Subject to any required action by the
-------------------------
stockholders of the Company, the Reserves, the maximum number of shares each
participant may purchase per Offering Period (pursuant to Section 7), as well as
the price per share and the number of shares of Common Stock covered by each
option under the Plan which has not yet been exercised 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 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.

(b) Dissolution or Liquidation. In the event of the proposed
--------------------------
dissolution or liquidation of the Company, the Offering Period then in progress
shall be shortened by setting a new Exercise Date (the "New Exercise Date"), and
shall terminate immediately prior to the consummation of such proposed
dissolution or liquidation, unless provided otherwise by the Board. The New
Exercise Date shall be before the date of the Company's proposed dissolution or
liquidation. The Board shall notify each participant in writing, at least ten
(10) business days prior to the New Exercise Date, that the Exercise Date for
the participant's option has been changed to the New Exercise Date and that the
participant's option shall be exercised automatically on the New Exercise Date,
unless prior to such date the participant has withdrawn from the Offering Period
as provided in Section 10 hereof.

(c) Merger or Asset Sale. In the event of a proposed sale of all or
--------------------
substantially all of the assets of the Company, or the merger of the Company
with or into another corporation, each outstanding option shall be assumed or an
equivalent option 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 Offering Period
then in progress shall be shortened by setting a new Exercise Date (the "New
Exercise Date") and shall end as of the New Exercise Date. The New Exercise
Date shall be before the effective date of the Company's proposed sale or
merger. The Board shall notify each participant in writing, at least ten (10)
business days prior to the New Exercise Date, that the Exercise Date for the
participant's option has been changed to the New Exercise Date and that the
participant's option shall be exercised automatically on the New Exercise Date,
unless prior to such date the participant has withdrawn from the Offering Period
as provided in Section 10 hereof.

-8-
<PAGE>

20. Amendment or Termination.
------------------------

(a) The Board of Directors of the Company may at any time and for any
reason terminate or amend the Plan. Except as provided in Section 19 hereof, no
such termination can affect options previously granted, provided that an
Offering Period may be terminated by the Board of Directors on any Exercise Date
if the Board determines that the termination of the Offering Period or the Plan
is in the best interests of the Company and its stockholders. Except as
provided in Section 19 and Section 20 hereof, no amendment may make any change
in any option theretofore granted which adversely affects the rights of any
participant. To the extent necessary to comply with Section 423 of the Code (or
any successor rule or provision or any other applicable law, regulation or stock
exchange rule), the Company shall obtain stockholder approval in such a manner
and to such a degree as required.

(b) Without stockholder consent and without regard to whether any
participant rights may be considered to have been "adversely affected," the
Board (or its committee) shall be entitled to change the Offering Periods, limit
the frequency and/or number of changes in the amount withheld during an Offering
Period, establish the exchange ratio applicable to amounts withheld in a
currency other than U.S. dollars, permit payroll withholding in excess of the
amount designated by a participant in order to adjust for delays or mistakes in
the Company's processing of properly completed withholding elections, establish
reasonable waiting and adjustment periods and/or accounting and crediting
procedures to ensure that amounts applied toward the purchase of Common Stock
for each participant properly correspond with amounts withheld from the
participant's Compensation, and establish such other limitations or procedures
as the Board (or its committee) determines in its sole discretion advisable
which are consistent with the Plan.

(c) In the event the Board determines that the ongoing operation of
the Plan may result in unfavorable financial accounting consequences, the Board
may, in its discretion and, to the extent necessary or desirable, modify or
amend the Plan to reduce or eliminate such accounting consequence including, but
not limited to:

(1) altering the Purchase Price for any Offering Period including
an Offering Period underway at the time of the change in Purchase Price;

(2) shortening any Offering Period so that Offering Period ends
on a new Exercise Date, including an Offering Period underway at the time of the
Board action; and

(3) allocating shares.

Such modifications or amendments shall not require stockholder
approval or the consent of any Plan participants.

21. Notices. All notices or other communications by a participant to the
-------
Company under or in connection with the Plan shall be deemed to have been duly
given when received in the form

-9-
<PAGE>

specified by the Company at the location, or by the person, designated by the
Company for the receipt thereof.

22. Conditions Upon Issuance of Shares. Shares shall not be issued with
----------------------------------
respect to an option unless the exercise of such option and the issuance and
delivery of such shares pursuant thereto shall comply with all applicable
provisions of law, domestic or foreign, including, without limitation, the
Securities Act of 1933, as amended, the Securities Exchange Act of 1934, as
amended, 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.

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 pur chased 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 applicable provisions of law.

23. Term of Plan. The Plan shall become effective upon the closing date
------------
of the Company's initial public offering of its equity securities registered on
Form S-1 with the Securities and Exchange Commission. It shall continue in
effect for a term of ten (10) years unless sooner terminated under Section 20
hereof.

24. Governing Law. The Plan and any Subscription Agreement or Notice of
-------------
Withdrawal entered into hereunder shall be governed by the internal substantive
laws, but not the choice of law rules, of Delaware.

25. Holding Period.
--------------

(a) Shares purchased by a participant shall be held in the
participant's account under the Plan during the Holding Period and may not be
sold, assigned, pledged or otherwise transferred (the "Holding Period Shares").
In the event of a proposed sale of all or substantially all of the Company's
assets, or a merger of the Company with or into another corporation, in which
shares of Common Stock are exchanged by the Company's stockholders, the Holding
Period shall terminate immediately prior to the effective date of the Company's
proposed sale or merger.

(b) During the Holding Period, participants shall have all the rights
of a stockholder, except the ability to transfer his or her shares with respect
to the Holding Period Shares

-10-
<PAGE>

EXHIBIT A
---------

TICKETMASTER ONLINE-CITYSEARCH, INC.

1998 EMPLOYEE STOCK PURCHASE PLAN

SUBSCRIPTION AGREEMENT

_____ Original Application Enrollment Date: __________
_____ Change in Payroll Deduction Rate
_____ Change of Beneficiary(ies)

1. _____________________________________ hereby elects to participate in the
Ticketmaster Online-CitySearch, Inc. 1998 Employee Stock Purchase Plan (the
"Employee Stock Purchase Plan") and subscribes to purchase shares of the
Company's Class B Common Stock (the "Common Stock") in accordance with this
Subscription Agreement and the Employee Stock Purchase Plan.

2. I hereby authorize payroll deductions from each paycheck in the amount of
____% of my Compensation on each payday (not to exceed 15%) during the
Offering Period in accordance with the Employee Stock Purchase Plan.
(Please note that no fractional percentages are permitted.)

3. I understand that said payroll deductions shall be accumulated for the
purchase of shares of Common Stock at the applicable Purchase Price
determined in accordance with the Employee Stock Purchase Plan. I
understand that if I do not withdraw from an Offering Period, any
accumulated payroll deductions will be used to automatically exercise my
option.

4. I UNDERSTAND THAT SHARES OF COMMON STOCK I PURCHASE UNDER THIS EMPLOYEE
STOCK PURCHASE PLAN CANNOT BE SOLD OR OTHERWISE TRANSFERRED BY ME FOR A
PERIOD OF 180 DAYS AFTER THE DATE OF PURCHASE (THE "HOLDING PERIOD") EXCEPT
AS OTHERWISE PROVIDED IN THE EMPLOYEE STOCK PURCHASE PLAN. I FURTHER
UNDERSTAND THAT DURING THE HOLDING PERIOD SUCH SHARES MUST REMAIN IN MY
PARTICIPANT ACCOUNT AT THE BROKER DESIGNATED BY THE COMPANY.

5. I have received a copy of the complete Employee Stock Purchase Plan. I
understand that my participation in the Employee Stock Purchase Plan is in
all respects subject to the terms of the Plan. I understand that my
ability to exercise the option under this Subscription Agreement is subject
to stockholder approval of the Employee Stock Purchase Plan.

6. Shares purchased for me under the Employee Stock Purchase Plan should be
issued in the name(s) of (Employee or Employee and Spouse only):
__________________________________________.
<PAGE>

7. I hereby agree to notify the Company in writing within 30 days after the
------------------------------------------------------------------------
date of any disposition of shares and I will make adequate provision for
------------------------------------------------------------------------
Federal, state or other tax withholding obligations, if any, which arise
------------------------------------------------------------------------
upon the disposition of the Common Stock. The Company may, but will not be
----------------------------------------
obligated to, withhold from my compensation the amount necessary to meet
any applicable withholding obligation including any withholding necessary
to make available to the Company any tax deductions or benefits
attributable to sale or early disposition of Common Stock by me.

8. I hereby agree to be bound by the terms of the Employee Stock Purchase
Plan. The effectiveness of this Subscription Agreement is dependent upon
my eligibility to participate in the Employee Stock Purchase Plan.

9. In the event of my death, I hereby designate the following as my
beneficiary(ies) to receive all payments and shares due me under the
Employee Stock Purchase Plan:

NAME: (Please print)
------------------------------------------------
(First) (Middle) (Last)

------------------- ------------------------------------------------
Relationship

------------------------------------------------
(Address)

Employee's Social
Security Number:
------------------------------------------------

Employee's Address:
------------------------------------------------

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

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

I UNDERSTAND THAT THIS SUBSCRIPTION AGREEMENT SHALL REMAIN IN EFFECT THROUGHOUT
SUCCESSIVE OFFERING PERIODS UNLESS TERMINATED BY ME.

Dated:
------------- -----------------------------------------------------
Signature of Employee

-----------------------------------------------------
Spouse's Signature (If beneficiary other than spouse)
<PAGE>

EXHIBIT B
---------

TICKETMASTER ONLINE-CITYSEARCH, INC.

1998 EMPLOYEE STOCK PURCHASE PLAN

NOTICE OF WITHDRAWAL

The undersigned participant in the Offering Period of the Ticketmaster
Online-CitySearch, Inc. 1998 Employee Stock Purchase Plan which began on
___________ 19____ (the "Enrollment Date") hereby notifies the Company that he
or she hereby withdraws from the Offering Period. He or she hereby directs the
Company to pay to the undersigned as promptly as practicable all the payroll
deductions credited to his or her account with respect to such Offering Period.
The undersigned understands and agrees that his or her option for such Offering
Period will be automatically terminated. The undersigned understands further
that no further payroll deductions will be made for the purchase of shares in
the current Offering Period and the undersigned shall be eligible to participate
in succeeding Offering Periods only by delivering to the Company a new
Subscription Agreement.

Name and Address of Participant:

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

Signature:

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

Date:
--------------------------------

<PAGE>

EXHIBIT 10.5

LICENSE AGREEMENT
-----------------

THIS LICENSE AGREEMENT made and effective this 9th day of March, 1996

BETWEEN: PERLY INC., of
345 Adelaide Street West,
Suite 400,
Toronto, Ontario
M5V 1R5

("Perly")

AND: PERFECT MARKET INC., of
4502 Dyer Street, Suite 201,
La Crescenta, California,
U.S.A. 91214

("Perfect")

BACKGROUND
- ----------

A. Perly is the owner of U.S. trademark and service mark registration no.
1.706.303 registered August 11, 1992, and is the owner of non-U.S trademark
and service mark no. 617598 registered February 23, 1990 for CITISEARCH,
for computer programs in the field of geographic information and data bases
containing geographic information, and for consulting services in the field
of geographic information.

B. Perfect wishes to use the trademark CITYSEARCH as a trademark for providing
on the Internet listings of businesses, attractions and facilities and
their locations (including maps), as well as current events and community
information for the public and wishes to have a license from Perly for such
use.

1. Perly hereby grants to Perfect a license, subject to the terms of this
agreement, to use the mark CITYSEARCH for the services of providing on the
internet listings of businesses, attractions and facilities and their
locations (including maps), as well as current events and community
information for the public. The license will be worldwide except for
Canada, subject to notices and payments of fees as set forth below. Perly
agrees not to license any user other than Perfect for a service similar to
that of Perfect. Perfect agrees that Perly may utilize the mark itself
and/or may license a user that is associated or affiliated with Perly.

2. As partial consideration for the grant of this license. Perfect will pay
Perly a sum of $[*] (all sums mentioned herein are in U.S. dollars)
concurrently with signing of this agreement by both parties. In addition,
Perfect will within 10 days from receipt of invoices therefor from Perly,
pay to Perly the out-of-pocket expenses incurred by Perly in relation to
the subject matter of this agreement, including Perly's costs relating to
the preparation of this agreement, and Perly's costs in relation to any
work performed concerning any trademark applications or registrations which
Perly reasonably believes are necessary or desirable to improve or obtain
protection in any place for the mark CITYSEARCH relating to this license.
Perly agrees to notify Perfect if on any occasion its above-mentioned costs
exceed $4,000.

- -------------
[*] = CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.

<PAGE>

-2-

3. Perfect's license will be effective without further payment other than as
specified above, for Internet listings as specified above in the city of
Pasadena, California and for the U.S. metropolitan area as defined by the
U.S. Census Bureau which contains Pasadena. If Perfect wishes to make its
license effective in any additional metropolitan area in the U.S. as
defined by the U.S. Census Bureau. Perfect will so notify Perly and will
pay Perly a fee of $[*] for each such additional metropolitan area, and
upon receipt of such notification and payment by Perly, Perfect's license
will then be effective in the additional U.S. metropolitan area in
question (subject to the terms of this agreement).

4. If Perfect wishes to make its license effective in any country outside the
U.S. (excluding Canada), Perfect will so notify Perly and will pay Perly
the sum of $1,000.00 for each country outside the U.S. Upon Perly's receipt
of such notice and payment, and subject to the terms of this agreement and
applicable law, Perfect's license for the country in question will become
effective.

5. Perfect will use the mark CITYSEARCH only for Internet listings of
businesses, attractions and facilities and their locations (including
maps), as well as current events and community information for the public,
which are located in areas in which its license has been made effective,
and then only in association with providing the Internet listings referred
to above. All such listings and their manner of provision will be of a high
quality and standard which will be subject to Perly's approval, such
approval not unreasonably to be withheld. Perfect will notify Perly of any
substantial change in the above mentioned Internet service or associated
material. Perfect may use the name CitySearch in its corporate name or
trade style.

6. Perfect shall in its use of the CITYSEARCH trademark publish such trademark
notice or notices, and in such matter, as Perly may from time to time
request. The standard for Perly's trademark notice request shall be that
such notifications are readable and reasonable.

7. Perfect will defend, indemnify and hold Perly harmless against all claims,
actions and suits brought against Perly and which result from, relate to or
arise from Perfect's activities under this license.

8. Perfect agrees that it will not use or advertise any word, design, mark or
name which is, or any part of which is, the same as, similar to or
confusingly similar with the mark CITYSEARCH except as specifically
permitted under this agreement.

9. Perfect acknowledges that the mark CITISEARCH and CITYSEARCH are and shall
at all times be solely the property of Perly, and that its use of the mark
CITYSEARCH enures to the benefit of Perly, and Perfect agrees that it will
not directly or indirectly do or cause to be done, whether by commission or
omission, any act which may in any way jeopardize or adversely affect the
validity or distinctiveness of such marks or the title of Perly thereto,
and Perfect agrees that it will without charge to Perly, upon request by
Perly or its representatives, do all things and execute all documents that
may at any time be necessary or desirable to ensure the validity and
distinctiveness of the mark CITISEARCH and CITYSEARCH and to ensure the
title of Perly thereto for all countries.

10. It is understood that Perly does not provide any warranties concerning the
trade marks licensed hereunder or Perfect's right to use such trade marks
in any place, other than Perly's own covenant not to complain of such use
by Perfect so long as Perfect complies in all respect with the terms of
this agreement. Perly warrants that Perly is the sole and exclusive owner
of the mark, free of all liens and encumbrances; there are no claims,
judgements or settlements to be paid by Perly or pending claims or
litigation relating to the mark.

- -------------
[*] = CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.

<PAGE>

-3-

11. Perfect agrees that Perly shall have the right of first refusal to supply
maps or mapping software for use in its service provided that the price and
quality of Perly's offerings shall be at least equal to Perfect's current
or proposed supplier. This right shall be subject to any previous agreement
or contract with Perfect and a third party. Perly shall have the onus to
advise Perfect when it has maps or map software where Perfect is operating.

12. The term of this license shall be five years from its date, subject to
earlier termination and to renewal as set forth below.

13. Perfect shall have the right to renew this agreement on the same terms and
conditions as those set forth here within for successive periods of one
year each by notice given to Perly at least 45 days before the expiry this
agreement or any renewal, and upon payment by Perfect to Perly of a
Payment of $[*] for each one year renewal, but no such renewal shall be
effective if Perfect is in breach of any term of this agreement, either at
time of notice or renewal.

14. If Perfect breaches this agreement, and if such breach is not remedied
within 45 days after notice of the breach is given by Perly to Perfect,
then Perly may terminate this agreement including any renewal thereof.

15. This agreement and any renewal thereof shall terminate if Perfect becomes
bankrupt or insolvent, or makes an assignment for the benefit of creditors,
or if all or any part of its business is placed in the hands of a receiver
or trustee, or if it seeks the benefit of any statute for the protection of
creditors or fails to meet its debts in general as they become due, or if
it ceases for a continuous period of six months to use the mark CITYSEARCH
for the Internet listings in question.

16. Perfect agrees that on termination or expiry of this agreement, it will
promptly cease use of the mark CITYSEARCH and will not thereafter use or
advertise the mark CITYSEARCH or any word, design, trademark or trade name
which is, or any part of which is, similar to or confusingly similar with
the mark CITISEARCH or CITYSEARCH, whether as a part of its corporate name
or otherwise.

17. It is agreed that clauses 7.9 and 16 will survive the termination or expiry
of this agreement and will remain in full force and effect at all times.

18. All notices given under this agreement will be considered properly given if
they are sent by facsimile, courier, or registered or certified mail to the
addresses of the parties as set forth above or to such other addresses as
the parties may in writing advise. Notices sent by facsimile or courier
will be considered given when received. Notices sent by registered or
certified mail will be considered given seven business days after being
mailed if there is no postal interruption in effect which would delay their
delivery.

19. This agreement is personal to Perfect and may not be assigned or
sublicensed by Perfect without Perly's prior written permission. Such
permission will not unreasonably be withheld if the assignment is to a
successor to substantially all of Perfect's business who is not a
competitor of Perly. Perly may assign this agreement upon notice to
Perfect. Perly shall not assign this agreement to any competitor of
Perfect except that it may make such an assignment to an affiliated or
associated company without restriction. Perfect may sublicense a joint
venture in which it has a substantial interest, or a user who licenses an
entire operating package from Perfect. Such sublicensed to be valid under
this agreement must be exclusive to one sublicensee per one given country
or region.

- -------------
[*] = CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.

<PAGE>

-4-

20. This agreement shall be governed by the laws of Ontario, Canada and all
disputes relating to the subject matter thereof shall be resolved by
appropriate tribunals in Ontario, Canada, whose decisions will be binding
on the parties.

21. This agreement will be binding upon and will enure to the benefit of the
parties and their respective permitted successors and assigns.

IN WITNESS OF WHICH the parties have duly executed this agreement under the
hands of their properly authorized officers.

PERLY INC.

By: [SIGNATURE ILLEGIBLE]
-----------------------
Title: President

PERFECTMARKET INC.

By: /s/ Charles Conn III
-----------------------
Title: President & CEO

<PAGE>

Amendment of License

Recitals:

1. Perly Inc. ("Perly") and PerfectMarket Inc. (predecessor to CitySearch
Inc., "CS", collectively the "Parties," executed that certain license
agreement dated March 9, 1996 (the "License"), whose subject matter is the
trademark "CITYSEARCH" described more fully therein (the "Mark").

2. Perly is the owner of registration number 365856 for the trademark
"CITYSEARCH" and recresents that this is a valid registration.

3. The Parties wish to amend the License to include Canada.

Therefore,

1. The License is hereby amended as follows:

a. Paragraph 1, line 4: "except for Canada" is deleted.
b. Paragraph 4, line 2: "(excluding Canada)" is deleted.

2. The Parties acknowledge that the purpose of this amendment is for Perly to
grant CS a license to use the Mark in Canada pursuant to the terms and
conditions contained in the License.

3. In partial consideration for this amendment CS agrees to pay to Perly a sum
of U.S. $[*], receipt of which is hereby acknowledged.

4. The parties acknowledge that the U.S. $[*] payment will satisfy all
payment obligations with respect to Canada pursuant to paragraph 4 of the
License.

5. If the Parties further amend the License with respect to any terms and
conditions therein including, but not limited to assigning the Mark to CS, the
U.S. $[*] amount will be applied toward CS's payment obligations, if any,
under the further amendment.

6. The Parties will take all necessary actions with respect to the Canadian
Trademark Office to record or otherwise validate the License and this
amendment, including, without limitation, the filing, at CS's expense, of a
Canadian application for the Mark, provided that no such Canadian application
will be filed earlier than one month from the date hereof without CS's consent.

Perly, Inc. CitySearch Inc.

By: [SIGNATURE ILLEGIBLE] By: /s/ Charles Conn III
--------------------- ---------------------
Its: President Its: Chief Executive Officer
---------------------
Date:Mar 14 1997 Date: 18 March 1997
-------------------- --------------------

- -------------
[*] = CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.

<PAGE>

EXHIBIT 10.9

LIMITED PARTNERSHIP AGREEMENT

BETWEEN

1310818 ONTARIO INC.

AND

METROLAND PRINTING, PUBLISHING & DISTRIBUTING LTD.

AND

CITYSEARCH CANADA INC.

AND

TELE-DIRECT (SERVICES) INC.

AND

CITYSEARCH, INC.

AND

TORSTAR CORPORATION

AND

TELE-DIRECT (PUBLICATIONS) INC.

MADE AS OF

AUGUST 31, 1998

_____________________________
[*] = CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH
RESPECT TO THE OMITTED PORTIONS.

-9-
<PAGE>

TABLE OF CONTENTS

<TABLE>
<CAPTION>
Page
<S> <C>
ARTICLE 1 INTERPRETATION
1.1 Definitions................................................................... 3
1.2 Headings and Table of Contents................................................ 7
1.3 Incorporation of Preambles and Recitals....................................... 7
1.4 Extended Meanings............................................................. 7
1.5 Accounting Principles......................................................... 7
1.6 Calculation of Time........................................................... 7

ARTICLE 2 THE LIMITED PARTNERSHIP
2.1 Formation.................................................................... 8
2.2 Declaration of Limited Partnership........................................... 8
2.3 Filing of Declarations....................................................... 9
2.4 Unlimited Liability of General Partner....................................... 9
2.5 Limited Liability of Limited Partners........................................ 9
2.6 Limited Partnership Interests................................................ 9
2.7 Business..................................................................... 10
2.8 Name......................................................................... 10
2.9 Authority.................................................................... 10
2.10 Activities................................................................... 10
2.11 California Franchise Disclaimer.............................................. 10
2.12 Ownership of Limited Partners................................................ 10
2.13 Year 2000 Compliance......................................................... 11

ARTICLE 3 PLACE OF LIMITED PARTNERSHIP BUSINESS
3.1 Location..................................................................... 12
3.2 Qualification................................................................ 12

ARTICLE 4 GENERAL PARTNER AND RESTRICTIONS ON LIMITED PARTNERS
4.1 General Partner and Duties of the General Partner............................ 12
4.2 Appointment of Operating Personnel by General Partner........................ 13
4.3 Reimbursement of the General Partner......................................... 13
4.4 Appointment of Publisher..................................................... 13
4.5 Borrowing.................................................................... 13
4.6 No Commingling of Funds...................................................... 13
4.7 Restrictions upon the General Partner........................................ 13
4.8 Representations and Warranties of General Partner............................ 14
4.9 Limitations on Authority of the Limited Partners............................. 14

ARTICLE 5 MANAGEMENT OF THE LIMITED PARTNERSHIP,ACCOUNTING AND FINANCIAL
STATEMENTS
</TABLE>
<PAGE>

<TABLE>
<S> <C>
5.1 Control...................................................................... 15
5.2 Meetings..................................................................... 15
5.3 Minute Book.................................................................. 15
5.4 Books and Records............................................................ 15
5.5 Financial Statements......................................................... 16
5.6 Auditors..................................................................... 16
5.7 Fiscal Year End.............................................................. 16
5.8 Other Information............................................................ 16

ARTICLE 6 CAPITAL CONTRIBUTIONS,ALLOCATIONS AND DISTRIBUTIONS
6.1 Classes of Accounts.......................................................... 17
6.2 Capital Contributions........................................................ 17
6.3 Capital Accounts and Initial Capital Contributions........................... 18
6.4 Additional Capital Contributions............................................. 18
6.5 Consequences of Non-Payment of Additional Capital Contribution............... 19
6.6 Allocation for Income Tax Purposes........................................... 21
6.7 Distributions to Limited Partners............................................ 22
6.8 Allocation in Event of Transfer.............................................. 22

ARTICLE 7 BUSINESS CONTRIBUTIONS AND OPERATION
7.1 Locations Where Service Will Be Provided..................................... 22
7.2 Site Selection............................................................... 24
7.3 Contributions of the Limited Partners........................................ 24
7.4 Subsequent Inputs............................................................ 24
7.5 Tele-Direct Contributions.................................................... 24
7.6 Excluded TEP/Metroland Assets and Excluded Tele-Direct Assets................ 25
7.7 Excluded Assets.............................................................. 25
7.8 Sympatico.................................................................... 26
7.9 CitySearch Canada Competitors................................................ 26

ARTICLE 8 COVENANTS OF LIMITED PARTNERS
8.1 Covenants.................................................................... 27

ARTICLE 9 TERMINATION, DISSOLUTION AND NON-COMPETITION
9.1 Term......................................................................... 27
9.2 Dissolution.................................................................. 28

ARTICLE 10 INSURANCE
10.1 Insurance.................................................................... 29

ARTICLE 11 GENERAL
11.1 Further Assurances........................................................... 29
11.2 Public Announcements......................................................... 30
11.3 Benefit of the Agreement..................................................... 30
11.4 Entire Agreement............................................................. 30
</TABLE>
<PAGE>

<TABLE>
<S> <C>
11.5 Dispute Resolution........................................................... 30
11.6 Amendment and Waiver......................................................... 31
11.7 Assignment................................................................... 31
11.8 Notices...................................................................... 31
11.9 Governing Law................................................................ 33
11.10 Limited Partner not a General Partner........................................ 33
11.11 Counterparts................................................................. 33
</TABLE>
<PAGE>

LIMITED PARTNERSHIP AGREEMENT
-----------------------------

THIS AGREEMENT made as of August 31, 1998;

B E T W E E N:

1310818 ONTARIO INC., a corporation incorporated under the laws of
Ontario

(hereinafter referred to as "General Partner")

OF THE FIRST PART

- and -

METROLAND PRINTING, PUBLISHING & DISTRIBUTING LTD., a corporation
incorporated under the laws of Ontario

(hereinafter referred to as "Metroland")

OF THE SECOND PART

- and -

CITYSEARCH CANADA INC., a corporation incorporated under the laws of
Ontario

(hereinafter referred to as "CitySearch Canada")

OF THE THIRD PART

- and -

TELE-DIRECT (SERVICES) INC., a corporation incorporated under the laws
of Canada

(hereinafter referred to as "Tele-Direct")

OF THE FOURTH PART

- and -
<PAGE>

-2-

CITYSEARCH, INC., a corporation incorporated under the laws of
Delaware

(hereinafter referred to as "CitySearch U.S.A.")

OF THE FIFTH PART

- and -

TORSTAR CORPORATION, a corporation incorporated under the laws of
Ontario

(hereinafter referred to as "Torstar")

OF THE SIXTH PART

- and -

TELE-DIRECT (PUBLICATIONS) INC., a corporation incorporated under the
laws of Canada

(hereinafter referred to as "Tele-Direct Pub.")

OF THE SEVENTH PART

WHEREAS the parties hereto hereby agree to form a limited partnership
for the purpose of operating the Limited Partnership Business;

AND WHEREAS the parties hereto have entered into this Agreement for
the purpose of making provision for the harmonious operation of the Limited
Partnership and to provide for their obligations with respect to the Limited
Partnership and to each other in respect of the Limited Partnership;

AND WHEREAS the General Partner is to be the general partner and the
Limited Partners are to be the limited partners of the limited partnership
created by this Agreement;

AND WHEREAS Tele-Direct Pub., CitySearch U.S.A. and Torstar are
parties to this Agreement for the purpose of giving the representations and
warranties provided for in Section 2.12;

AND WHEREAS CitySearch U.S.A. is also a party to this Agreement for
the purpose of giving the covenant in Section 2.13;
<PAGE>

-3-

NOW THEREFORE THIS AGREEMENT WITNESSES that, in consideration of the
premises and the covenants and agreements herein contained and for other good
and valuable consideration the receipt and sufficiency of which is hereby
acknowledged, the parties hereto covenant and agree as follows:

ARTICLE 1
INTERPRETATION
--------------

1.1 DEFINITIONS
-----------

In this Agreement, unless something in the subject matter or context
is inconsistent therewith, the following terms as used herein, including the
recitals, shall have the meanings set forth below:

(a) "AMENDED AND RESTATED LICENSE AND SERVICES AGREEMENT" means the
agreement made between CitySearch U.S.A. and CitySearch Canada
providing for the licensing to CitySearch Canada of certain software,
technology and know-how dated as of August 31, 1998;

(b) "ACT" means the Limited Partnerships Act (Ontario) as now enacted or
as the same may be from time to time amended, re-enacted or replaced;

(c) "AFFILIATE" means an affiliate of a party as determined by the
provisions of the Business Corporations Act (Ontario) as now enacted
or as the same may be from time to time amended, re-enacted or
replaced;

(d) "AGREEMENT" means this agreement and all amendments made hereto by
written agreement between the parties hereto;

(e) "ANCILLARY AGREEMENTS" means the Amended and Restated License and
Services Agreement, toronto.com Sublicense and Services Agreement,
Tele-Direct Sales Agreement, Tele-Direct Services Agreement, Torstar
Services Agreement, Metroland and CitySearch Conveyance and Employee
Transfer Agreement, Reciprocal Fees Agreement and Non-Competition
Agreement, each dated as of August 31, 1998;

(f) "ANNUAL BUDGET" means the then current annual budget (including
projections of cash flow, capital expenditure and income) for the
Limited Partnership approved pursuant to Section 5.1 of the Unanimous
Shareholder Agreement;

(g) "AUDITORS" means the auditors appointed pursuant to Section 5.6;
<PAGE>

-4-

(h) "BOARD OF DIRECTORS" means the board of directors of the General
Partner as elected or appointed from time to time;

(i) "BUSINESS" means the business of developing and operating local on-
line services (with content comprising local news and information,
local events, yellow pages business directories, and with classified
advertising content relating to jobs, automotive, real estate and
other classifications) that facilitate communication and business
transactions for internet users, generating revenue from advertising
and electronic commerce transactions, all as more particularly
described in Schedule B;

(j) "BUSINESS DAY" means a day other than a Saturday, Sunday or statutory
holiday in Ontario or California;

(k) "BUSINESS PLAN" means a business and marketing plan of the Limited
Partnership as approved by the Board of Directors pursuant to Section
5.1 of the Unanimous Shareholder Agreement;

(l) "CAPITAL" means the amount of cash or the value of all property
contributed to the capital of the Limited Partnership pursuant to the
provisions hereof;

(m) "CAPITAL ACCOUNT" of a Limited Partner means an account to which is
credited or debited all Capital contributions received from and
Capital distributions made, respectively, to such Limited Partner, in
accordance with the provisions of this Agreement;

(n) "CITYSEARCH INFORMATION SERVICE" means an online service of providing
Content related to restaurants, entertainment, retail establishment,
community events and other services, including on-line ticketing and
sale of merchandise, pertaining to a particular city or geographic
region which uses the CitySearch Systems;

(o) "CITYSEARCH SYSTEMS" has the meaning ascribed thereto in the Amended
and Restated License and Services Agreement;

(p) "CONTENT" has the meaning ascribed thereto in the Amended and Restated
License and Services Agreement;

(q) "CONTRIBUTING LIMITED PARTNER" has the meaning ascribed thereto in
Section 6.5;

(r) "CURRENT ACCOUNT" of a Limited Partner means an account to which is
credited or debited the net income or net loss, respectively, of the
Limited Partnership allocated to such Limited Partner in accordance
with the provisions of Section 6.1;
<PAGE>

-5-

(s) "DILUTION DATE" has the meaning set forth in Section 6.5;

(t) "DISTRIBUTION" and "DISTRIBUTED" shall mean amounts paid or other
property distributed by the Limited Partner in respect, or on account
of its interest in the Limited Partnership;

(u) "DIRECT COMPETITOR" of Metroland means a person whose business is
primarily involved in newspaper or electronic publishing; a Direct
Competitor of CitySearch Canada means a person whose business competes
directly with that of CitySearch Canada, CitySearch U.S.A. or any of
their respective Affiliates involved in electronic publishing; and a
Direct Competitor of Tele-Direct means a person whose business
competes directly with Tele-Direct or any of its respective Affiliates
in print and electronic publishing and data-related businesses;

(v) "EBITDA" means, for a particular fiscal period of the Limited
Partnership, the income (or loss) of the Limited Partnership before
deductions of depreciation, amortization, interest and taxes for such
fiscal period as determined from the financial statements of the
Limited Partnership for such period;

(w) "EXCLUSIVE TERRITORY" means the territory so marked in Schedule A;

(x) "EXECUTIVE COMMITTEE" means the executive committee of the Board of
Directors of the General Partner, as constituted from time to time;

(y) "FISCAL YEAR" means the period which currently commences on the date
hereof or January 1, and the case may be in any calendar year and ends
on December 31 in the same calendar year, or any other period
determined from time to time by the Board of Directors of the
Corporation to be the fiscal year of the Corporation;

(z) "GENERAL PARTNER" means 1310818 Ontario Inc.;

(aa) "INITIAL CAPITAL CONTRIBUTION" means in the case of Tele-Direct, the
amount of $[*] in cash, in the case of CitySearch Canada, the adjusted
cost base of the assets it is contributing under Section 6.2(b)(i)
which is estimated to be [*] Dollars ($[*]), and in the case of
Metroland, the adjusted cost base of the assets it is contributing
under Section 6.2(b)(ii) and an amount by way of deemed Capital
contribution sufficient to bring Metroland's Initial Capital
Contribution to [*] Dollars ($[*]);

(bb) "LIMITED PARTNERS" means Tele-Direct, Metroland and CitySearch Canada,
together with such other Persons who may become parties to this
Agreement and Limited Partner means any one of them;

[*] = CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
<PAGE>

-6-

(cc) "LIMITED PARTNERSHIP" means the limited partnership constituted by
this Agreement;

(dd) "LIMITED PARTNERSHIP BUSINESS" means the Business to be carried on in
the Exclusive Territory set forth on the map in Schedule A;

(ee) "LIMITED PARTNERSHIP INTEREST" has the meaning, subject to adjustment
pursuant to Section 6.4(2), set forth in Schedule E;

(ff) "MAJOR LIMITED PARTNERS" means Tele-Direct and Metroland and a Major
Limited Partner means any one of them;

(gg) "MAJOR SHAREHOLDERS" means collectively Tele-Direct and Metroland and
a "Major Shareholder" means any one of them;

(hh) "METROLAND AND CITYSEARCH CANADA CONVEYANCE AND EMPLOYEE TRANSFER
AGREEMENT" means an agreement among CitySearch Canada, Metroland,
Tele-Direct and the Limited Partnership dated August 31, 1998;

(ii) "NON-COMPETITION AGREEMENT" means an agreement made as of August 31,
1998 among Toronto Star Newspapers Ltd, Metroland, Tele-Direct and
CitySearch Canada;

(jj) "NON-CONTRIBUTING LIMITED PARTNER" has the meaning set forth in
Section 6.5;

(kk) "NOTICE" has the meaning set forth in Section 6.5;

(ll) "PERSON" means an individual, partnership, unincorporated association,
organization, syndicate, corporation, trustee, executor, administrator
or other legal or personal representative;

(mm) "PROMISSORY NOTE" has the meaning ascribed thereto in Section 6.2(b);

(nn) "SHAREHOLDER" means any holder of shares in the capital of the General
Partner;

(oo) "TEP" means Torstar Electronics Publishing Ltd;

(pp) "TORONTO STAR CITYSEARCH" means the general partnership formed as of
February 17, 1997 between Metroland and CitySearch Canada;

(qq) "TORONTO.COM SUBLICENSE AND SERVICES AGREEMENT" means the agreement
between CitySearch Canada and the Limited Partnership dated as of
August 31, 1998;
<PAGE>

-7-

(rr) "TRANSFER" means to sell, assign, surrender, give, transfer, pledge,
mortgage, charge, create a security interest in, hypothecate or
otherwise encumber the Limited Partnership Interest, whether
voluntary, involuntary, by operation of law or otherwise. A change in
control of a Limited Partner shall be deemed not to be a Transfer of
the Limited Partnership Interest held by that Limited Partner; and

(ss) "UNANIMOUS SHAREHOLDERS AGREEMENT" means an agreement made as of
August 31, 1998 between Tele-Direct, Metroland, CitySearch Canada and
the General Partner.

1.2 HEADINGS AND TABLE OF CONTENTS
------------------------------

The division of this Agreement into Articles and Sections, the
insertion of headings and the provision of any table of contents are for
convenience of reference only and shall not affect the construction or
interpretation of this Agreement. The terms "this Agreement", "hereof",
"hereunder" and similar expressions refer to this Agreement and not to any
particular Article, Section or other portion hereof and include any agreement
supplemental hereto.

1.3 INCORPORATION OF PREAMBLES AND RECITALS
---------------------------------------

The preambles and recitals set forth herein are true and correct at
the date hereof and are deemed to be part of this Agreement.

1.4 EXTENDED MEANINGS
-----------------

In this Agreement words importing the singular number only shall
include the plural and vice versa, words importing any gender shall include all
genders and words importing Persons shall include individuals, partnerships,
associations, trusts, unincorporated organizations and corporations.

1.5 ACCOUNTING PRINCIPLES
---------------------

Wherever in this Agreement reference is made to a calculation to be
made in accordance with generally accepted accounting principles, such reference
shall be deemed to be to the generally accepted accounting principles from time
to time approved by the Canadian Institute of Chartered Accountants, or any
successor institute, applicable as at the date on which such calculation is made
or required to be made.
<PAGE>

-8-

1.6 CALCULATION OF TIME
-------------------

When calculating the period of time within which or following which
any act is to be done or step taken pursuant to this Agreement, the first day of
such period shall be excluded and the last day of such period shall be included.
If the last day of such period is not a Business Day, the period in question
shall end on the next Business Day.

1.7 CURRENCY
--------

Unless otherwise provided herein, all reference to currency shall be
to Canadian dollars.

1.8 SECTION AND SCHEDULE REFERENCES
-------------------------------

Unless the context requires otherwise, references in this Agreement to
Sections, Exhibits or Schedules are to Sections, Exhibits or Schedules of this
Agreement. The Exhibits and Schedules to this Agreement are as follows:

EXHIBITS
--------

A Promissory Note

SCHEDULES
---------

A Area Map of the Exclusive Territory
B Description of the Limited Partnership's Business
C Cities/Regions in which Torstar/Metroland Operates and in which
Tele-Direct Operates
D Inputs
E Limited Partnership Interest

ARTICLE 2
THE LIMITED PARTNERSHIP
-----------------------

2.1 FORMATION
---------

The General Partner and the Limited Partners hereby constitute
themselves a limited partnership (the "Limited Partnership") for the purpose of
carrying on the Limited Partnership Business, subject to the terms and
conditions hereinafter set forth. To the extent not otherwise provided for
herein, the Limited Partnership shall be governed by the provisions of the Act
as now enacted or as the same may be from time to time amended, re-enacted or
replaced.
<PAGE>

-9-

2.2 DECLARATION OF LIMITED PARTNERSHIP
----------------------------------

A Declaration of Limited Partnership shall be filed or recorded to
establish the Limited Partnership with the Ministry of Consumer and Commercial
Relations in accordance with the provisions of the Act and in such other public
office as is required under applicable law or deemed advisable under the
discretion of the General Partner. Further amendments to the declaration also
shall be duly filed and recorded as required under the law or deemed advisable
in the discretion of the General Partner.

2.3 FILING OF DECLARATIONS
----------------------

As soon as practicable following the execution hereof, the General
Partner shall cause to be executed and filed such declarations, instruments and
documents as may be required under the laws of Ontario including the requisite
declarations under the Act. The General Partner shall, in accordance with the
provisions of this Agreement, cause to be filed, as appropriate, additional
declarations as required under the Act. The General Partner and each Limited
Partner shall execute and deliver as promptly as possible any documents that may
be necessary or desirable to accomplish the purposes of this Agreement or to
give effect to the formation and continuance of the Limited Partnership under
applicable laws. The General Partner shall take all necessary actions on the
basis of information available to it and maintain the status of the Limited
Partnership as a limited partnership.

2.4 UNLIMITED LIABILITY OF GENERAL PARTNER
--------------------------------------

The General Partner will have unlimited liability for all debts and
other liabilities and obligations of the Limited Partnership.

2.5 LIMITED LIABILITY OF LIMITED PARTNERS
-------------------------------------

Subject to the Act and any specific assumption of liability, the
liability of each Limited Partner for the debts, liabilities and obligations of
the Limited Partnership is limited to the amount of capital that such Limited
Partner has contributed or agreed to contribute to the Limited Partnership plus
such Limited Partner's share of the undistributed income of the Partnership as
set out herein and a Limited Partner shall have no further personal liability
for such debts, liabilities and obligations after making the full amount of such
Limited Partner's capital contribution to the Limited Partnership, subject to
any further calls or assessments or further contributions to the Limited
Partnership required pursuant to the terms of this Agreement.
<PAGE>

-10-

2.6 LIMITED PARTNERSHIP INTERESTS
-----------------------------

Notwithstanding the unequal Capital contributions of the General
Partner and the Limited Partners, the General Partner and the Limited Partners
hereby acknowledge and agree that as of the date hereof the respective Limited
Partnership Interests are as set forth in Schedule E.

2.7 BUSINESS
--------

The Limited Partnership shall not carry on any business other than the
Limited Partnership Business and no assets of the Limited Partnership shall be
used by any Limited Partner for any purpose other than the Limited Partnership
Business.

2.8 NAME
----

The name of the Limited Partnership shall be toronto.com. The primary
brand and URL address of the website for the Limited Partnership shall be
toronto.com. The by-line shall read as follows: "A Torstar/Tele-Direct
Partnership". In addition, the Toronto Star and Yellow Pages brands and/or
trademarks will be prominently displayed on the homepage and elsewhere on the
site. A mark will be placed "above the fold" on the first screen visible without
scrolling on the home page with the CitySearch U.S.A. logo and the statement "A
member of the CitySearch network".

2.9 AUTHORITY
---------

Except as otherwise provided herein, no Limited Partner shall have any
authority to act for, or assume any obligation or responsibility on behalf of,
any other Limited Partner or the Limited Partnership.

2.10 ACTIVITIES
----------

Each Limited Partner shall act in good faith toward, and in the best
interests of, the Limited Partnership and shall devote such time as may be
required to fulfill the obligations assumed by the Limited Partner in this
Agreement. Except as otherwise provided in Article 7 and subject to such
activities not causing a breach of this Agreement, each Limited Partner may
engage in any other business or activity outside the Limited Partnership
Business.
<PAGE>

-11-

2.11 CALIFORNIA FRANCHISE DISCLAIMER
-------------------------------

The parties agree that neither this Agreement nor the business
relationship established hereunder will be construed as granting a franchise.
The parties warrant to one another that they have consulted counsel in reviewing
and negotiating this Agreement and have concluded that no business plan or
franchise fees are conveyed or provided for in this Agreement or otherwise by
the relationship established hereby or by the relationship between the parties.

2.12 OWNERSHIP OF LIMITED PARTNERS
-----------------------------

(1) CitySearch U.S.A. represents and warrants to Tele-Direct, Tele-Direct
Pub., Torstar and Metroland that it is the beneficial and registered owner of
all of the outstanding shares of CitySearch Canada. Subject to the terms of
this Agreement, CitySearch U.S.A. covenants to ensure that the Limited
Partnership Interest held by CitySearch Canada continues to be held by a direct
or indirect wholly-owned subsidiary of CitySearch U.S.A.

(2) Torstar represents and warrants to Tele-Direct, Tele-Direct Pub.,
CitySearch U.S.A. and CitySearch Canada that it is the beneficial and registered
owner of all of the outstanding shares of Toronto Star Newspapers Limited, which
is the beneficial and registered owner of all of the outstanding shares of
Metroland. Subject to the terms of this Agreement, Torstar covenants to ensure
that the Limited Partnership Interest held by Metroland continues to be held by
a direct or indirect wholly-owned subsidiary of Torstar.

(3) Tele-Direct Pub. represents and warrants to Torstar, Metroland,
CitySearch U.S.A. and CitySearch Canada that it is the beneficial and registered
owner of all of the outstanding shares of Tele-Direct. Subject to the terms of
this Agreement, Tele-Direct Pub. covenants to ensure that the Limited
Partnership Interest held by Tele-Direct continues to be held by a direct or
indirect wholly-owned subsidiary of Tele-Direct Pub.

2.13 YEAR 2000 COMPLIANCE
--------------------

CitySearch U.S.A. covenants that on or before August 31, 1999:

(i) its 2.5, 2.6 and 2.7 releases of the software currently utilized
by the Limited Partnership will be installed in the toronto.com
platform; and

(ii) such releases will be Year 2000 compliant.

For the purposes of this Agreement, Year 2000 compliance shall mean the software
has been written and tested to support numeric transitions in leap years and
from the 20th to the 21st centuries, and back (eg. all calculations, ageing,
reporting, printing, displays, reversals, disasters, on vital records,
recoveries) without corruption or impact to current and/or future operations,
and that the software will operate during each such time period without error or
inaccuracy relating to
<PAGE>

-12-

or arising from the processing of calendar date data, including without
limitation, recognizing, calculating, comparing, managing, manipulating, sorting
and sequencing from, into and between different centuries or more than one
century, recognizing calendar date data century and performing calculations to
accommodate same-century and multi-century formulas and calendar date values.

ARTICLE 3
PLACE OF LIMITED PARTNERSHIP BUSINESS
-------------------------------------

3.1 LOCATION
--------

The principal place of business shall be at 1 Yonge Street, in the
City of Toronto in the Province of Ontario, M5E 1E6, or as may otherwise be
determined by the General Partner, and the books and records of accounts of the
Limited Partnership shall be kept at such location.

3.2 QUALIFICATION
-------------

To the extent required by any applicable law, the Limited Partnership
and each Limited Partner shall qualify to carry on the Limited Partnership
Business where the Limited Partnership Business is to be carried on from time to
time and shall maintain such registrations as may be necessary to lawfully carry
on the Limited Partnership Business.

ARTICLE 4
GENERAL PARTNER AND RESTRICTIONS ON LIMITED PARTNERS
----------------------------------------------------

4.1 GENERAL PARTNER AND DUTIES OF THE GENERAL PARTNER
-------------------------------------------------

Subject to any delegation of its powers properly authorized and
subject to the provisions of the Act, the General Partner will control and have
full and exclusive power, authority and responsibility of the business of the
Limited Partnership and will do or cause to be done in a prudent and reasonable
manner any and all acts necessary, appropriate or incidental to the business of
the Limited Partnership.

The General Partner shall exercise the powers and discharge the duties
of its office hereunder honestly, in good faith and in the best interest of the
Limited Partners and, in connection therewith, shall exercise the degree of
care, diligence and skill that a reasonably prudent person, experienced in the
business of the Limited Partnership, would exercise in comparable circumstances.
The General Partner shall be entitled to retain advisors, experts or consultants
to assist it in the exercise of its powers and the performance of its duties
hereunder. The General Partner further covenants that it shall maintain the
confidentiality of financial and other information and data which it may obtain
through or on behalf of the Limited Partnership,
<PAGE>

-13-

the disclosure of which may adversely affect the interests of the Limited
Partnership or a Limited Partner, except to the extent that the disclosure is
required by law or is in the best interests of the Limited Partnership, and it
shall utilize the information and data only for the business of the Limited
Partnership.

4.2 APPOINTMENT OF OPERATING PERSONNEL BY GENERAL PARTNER
-----------------------------------------------------

The General Partner shall appoint operating personnel of the Limited
Partnership and specify their duties.

4.3 REIMBURSEMENT OF THE GENERAL PARTNER
------------------------------------

The General Partner is entitled to reimbursement by the Limited
Partnership for all reasonable third party costs and expenses which are incurred
by the General Partner on behalf of the Limited Partnership in the ordinary
course of business or other costs and expenses incidental to acting as General
Partner to the Limited Partnership which are incurred, provided the General
Partner is not in default of its duties hereunder in connection with such costs
and expenses.

4.4 APPOINTMENT OF PUBLISHER
------------------------

The General Partner shall appoint the Publisher of the Limited
Partnership who shall report directly to the Executive Committee, which in turn
shall report to the Board of Directors. Until replaced with the approval of a
majority of the Board of Directors, the first Publisher shall be a Torstar
employee.

4.5 BORROWING
---------

The General Partner may borrow funds in the name of and on the
security of the assets of the Limited Partnership for the purposes of financing
and refinancing the business and operations of the Limited Partnership but not
for any other purpose.

4.6 NO COMMINGLING OF FUNDS
-----------------------

The funds or assets of the Limited Partnership shall not be commingled
with the funds or assets of the General Partner or any other Person.

4.7 RESTRICTIONS UPON THE GENERAL PARTNER
-------------------------------------

(1) The General Partner covenants that it shall not without the written
consent of all of the Limited Partners:
<PAGE>

-14-

(a) cause the Limited Partnership to guarantee the obligations or
liabilities of or make loans to the General Partner or any affiliate
or associate of the General Partner; or

(b) commingle the funds of the Limited Partnership with the funds of the
General Partner or any affiliate or associate of either of the General
Partner or any other Person;

(2) The General Partner has no authority without the written consent to
the specific act of all of the Limited Partners to:

(a) do any act in contravention of this Agreement;

(b) do any act which makes it impossible to carry on the ordinary business
of the Limited Partnership;

(d) possess property of the Limited Partnership, or assign any rights in
specific property of the Limited Partnership, for other than a limited
partnership purpose; or

(e) admit a Person as a general partner.

4.8 REPRESENTATIONS AND WARRANTIES OF GENERAL PARTNER
-------------------------------------------------

The General Partner represents, warrants and covenants to the Limited
Partners that the General Partner:

(a) is a corporation incorporated and in good standing under the laws of
the Province of Ontario;

(b) has the capacity and corporate authority to act as General Partner and
to perform its obligations under this Agreement, and such obligations
do not and will not conflict with or breach its Articles of
Incorporation, by-laws or any agreement by which it is bound; and

-15-

4.9 LIMITATIONS ON AUTHORITY OF THE LIMITED PARTNERS
------------------------------------------------

While Limited Partners have voting rights with respect to certain
matters, including the termination of the Limited Partnership, no Limited
Partner may take part in the operation or management of the business of the
Limited Partnership nor may any Limited Partner have the power to sign for or to
bind the Limited Partnership; however a Limited Partner may from time to time
examine into the state and progress of the business of the Limited Partnership
and advise as to its management. Limited Partners shall comply with the
provisions of the Act in force or in effect from time to time and shall not take
any action which will jeopardize or eliminate the status of the Limited
Partnership as a limited partnership.

ARTICLE 5
MANAGEMENT OF THE LIMITED PARTNERSHIP,
ACCOUNTING AND FINANCIAL STATEMENTS
-----------------------------------

5.1 CONTROL
-------

The General Partner shall have the full and exclusive control of the
business of the Limited Partnership. The Limited Partners shall have no control
over and no right to control the business of the Limited Partnership or the
management or direction of its affairs or policy and shall not have any power to
transact the business of, or sign for, or in any way bind, the Limited
Partnership.

5.2 MEETINGS
--------

Meetings of the Limited Partners may be called at any time by the
General Partner and shall be called upon written request of the Limited
Partners. Such request shall specify the purpose or purposes for which such
meeting is to be called and shall include sufficient information to enable other
Limited Partners to make a reasoned judgment on each matter to be considered at
the meeting. Any such meeting shall be held at such place in Ontario as the
General Partner shall reasonably designate. If the General Partner fails to
call a meeting upon such request of Limited Partners within a period of 10 days
after the giving of such request, the requesting Limited Partner(s) may call
such meeting and the notice calling such meeting shall be signed by such
requesting Limited Partner(s) or by any Person as such requesting Limited
Partner(s) may specify in writing.

5.3 MINUTE BOOK
-----------

All proceedings at all meetings of Limited Partners shall be recorded
in a minute book by the General Partner, which minute book shall be available
for the inspection of the Limited Partners at all meetings of Limited Partners
and at all other reasonable times during normal business hours at the offices of
the Limited Partnership.
<PAGE>

-16-

5.4 BOOKS AND RECORDS
-----------------

Proper books of account and records shall reflect all Limited
Partnership transactions, shall be kept by the Limited Partnership at the
principal place of business, and entry shall be made therein in accordance with
generally accepted accounting principles. Each of the Limited Partners shall
have access at all reasonable times to examine and copy such books of account
and records, as well as tax returns and tax assessments, provided that any
confidential information which is obtained from their examinations shall not be
disclosed to Persons who are not Shareholders or Limited Partners (or their
professional advisors) and shall not be used for any improper purpose. The
financial statements for the Limited Partnership shall be audited for all Fiscal
Years of the Limited Partnership.

5.5 FINANCIAL STATEMENTS
--------------------

(1) As soon as practicable after the end of each month but no later than
six (6) Business Days thereafter, financial statements shall be prepared by the
Limited Partnership, for and as of the end of such month, in accordance with
generally accepted accounting principles consistently applied, and such
financial statements shall show the cash flow, the assets and the liabilities of
the Limited Partnership, all income and revenue received and receivable and all
expenses, costs and charges incurred and paid or payable by the Limited
Partnership in respect of such month, with the resulting net profit or loss of
the Limited Partnership in respect of such month, and shall also show the
amounts standing to the credit of each Limited Partner hereto in respect of its
Capital Account and Current Account, all in accordance with the provisions
herein contained. As soon as practicable at the end of each Fiscal Year of the
Limited Partnership but no more than 30 days thereafter, like financial
statements shall be prepared for and as of the end of such Fiscal Year. As soon
as practicable at the end of each Fiscal Year of the Limited Partnership and no
later than sixty (60) days thereafter, audited financial statements shall be
prepared for the Limited Partnership at the expense of the Limited Partnership
in accordance with generally accepted accounting principles consistently
applied.

(2) Any financial statements prepared and certified by the Auditors as
herein provided shall be final, binding and conclusive among the Limited
Partners in the absence of manifest error.

5.6 AUDITORS
--------

Ernst & Young shall be appointed the Auditors unless, prior to the
appointment of any other Person as Auditors, the General Partner has consented
in writing to such person being appointed.

5.7 FISCAL YEAR END
---------------
<PAGE>

-17-

The fiscal year end of the Limited Partnership shall be December 31 in
each year.

5.8 OTHER INFORMATION
-----------------

The General Partner shall provide or cause to be provided to the
Limited Partners such additional financial and other information as may be
required from time to time under applicable legislation.

ARTICLE 6
CAPITAL CONTRIBUTIONS,
ALLOCATIONS AND DISTRIBUTIONS
-----------------------------

6.1 CLASSES OF ACCOUNTS
-------------------

(1) The Limited Partnership shall maintain a Capital Account and a Current
Account for each Limited Partner.

(2) The Capital contributions by each Limited Partner shall be credited to
the Capital Account maintained for such Limited Partner and the Capital
distributed to such Limited Partner shall be debited therefrom. No Limited
Partner shall be entitled to withdraw any part of its Capital Account or to
receive any distribution except as determined by the Board of Directors.

(3) The Limited Partnership's income allocated to each Limited Partner
shall be credited to the Current Account maintained for such Limited Partner and
any Limited Partnership's loss allocated to such Limited Partner shall be
debited therefrom. All distributions to the Limited Partners (except Capital
distributions) shall be debited to the Current Accounts.

6.2 CAPITAL CONTRIBUTIONS
---------------------

(a) GENERAL PARTNER

The General Partner shall contribute as Capital to the Limited
Partnership the cash sum of $10, on execution of this Agreement.

(b) LIMITED PARTNERS

Not later than the close of business on the Business Day following the
date of this Agreement, or as otherwise agreed, the Limited Partners shall make
Capital contributions to the Limited Partnership as follows:

(i) CitySearch Canada shall contribute its undivided interest in the
assets and its proportionate share of the liabilities of Toronto
Star CitySearch as set
<PAGE>

-18-

out in the Metroland and CitySearch Canada Conveyance and
Employee Transfer Agreement;

(ii) Metroland shall contribute its undivided interest in the assets
and its proportionate share of the liabilities of Toronto Star CitySearch
as set out in the Metroland and CitySearch Canada Conveyance and Employee
Transfer Agreement; and

(iii) Tele-Direct shall contribute $[*] of which $[*] shall be
contributed not later than the close of business on the Business Day
following the date of this Agreement, together with a promissory note in
substantially the same form as Exhibit A hereto for the balance (the
"Promissory Note"), of which $[*] is to be contributed on February 26, 1999
and $[*] is to be contributed on May 28, 1999, or such earlier dates as
determined by the Board of Directors.

No Limited Partner shall be entitled to interest on the amount of its
Capital contribution to the Limited Partnership.

(d) GST AND PST INDEMNIFICATION

Metroland and CitySearch Canada shall indemnify the Limited
Partnership from Goods and Services Tax and Ontario Provincial Sales Tax
resulting from the Transfer of their respective undivided interests in the
assets of Toronto Star CitySearch to the Limited Partnership.

6.3 CAPITAL ACCOUNTS AND INITIAL CAPITAL CONTRIBUTIONS
--------------------------------------------------

As of the date hereof, the Capital Accounts of the Limited Partners
are as follows:

Tele-Direct: $[*]
Metroland: $[*]
CitySearch Canada: $[*]

The foregoing is subject to amendment to reflect the actual cost base
of the assets being contributed to the Limited Partnership by Metroland and
CitySearch Canada. After finalization of the Capital Accounts for Metroland and
CitySearch Canada, Tele-Direct shall have the right to review and verify the
amount of such Capital Accounts.

6.4 ADDITIONAL CAPITAL CONTRIBUTIONS
--------------------------------

[*] = CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
<PAGE>

-19-

(1) Additional Capital contributions required for the Limited Partnership
shall be identified and provided for in the Annual Budget. By the close of
business on the last Business Day of each fiscal quarter, the Major Limited
Partners agree to make any additional Capital contributions, on a pro rata
basis, which are specified in the Annual Budget and approved by the Major
Limited Partners as being required for the fiscal quarter following the next
succeeding fiscal quarter. In addition, the Major Limited Partners shall have
the authority to determine, on a quarterly basis, the amount of any additional
required Capital contributions not identified in the Annual Budget which are in
the best interest of the Limited Partnership. Such additional Capital
contributions determined by the Major Limited Partners as being required in a
particular fiscal quarter shall not exceed [*]% of the Capital contributions
specified in the Annual Budget for such fiscal quarter. The Major Limited
Partners agree to make additional Capital contributions, on a pro rata basis, by
the close of business on the second Business Day following a capital call by
them.

(2) Each Major Limited Partner shall contribute its pro rata share of the
additional Capital contributions pursuant to Section 6.4(1), failing which that
Major Partner's Limited Partnership Interest shall be diluted in accordance with
the formula set forth in Section 6.5.

(3) In the event that any Major Limited Partner fails to make an
additional Capital contribution required pursuant to Section 6.4(1), and that
Major Partner's Limited Partnership Interest is diluted, the General Partner
shall cause Schedule E to be amended to appropriately reflect the adjustment to
the Limited Partnership Interests of the Limited Partners.

6.5 CONSEQUENCES OF NON-PAYMENT OF ADDITIONAL CAPITAL CONTRIBUTION
--------------------------------------------------------------

If a Major Limited Partner fails to make an additional Capital
contribution in accordance with Section 6.4(1) hereof (the "Non-Contributing
Limited Partner") the other Major Limited Partner (the "Contributing Limited
Partner") may, in addition to making its own contribution, elect by notice to
the Non-Contributing Limited Partner (the "Notice"), to make the contribution of
the Non-Contributing Limited Partner. Upon non-contribution by a Major Limited
Partner, the Limited Partnership Interest of the Non-Contributing Limited
Partner shall be diluted in accordance with the terms and conditions hereinafter
set forth.

(a) In the event that the Non-Contributing Limited Partner has not paid
its proportionate share of the additional Capital contribution by the
close of the second Business Day (the "Dilution Date") following
receipt of a capital call pursuant to Section 6.4(1), such Non-
Contributing Partner's Limited Partnership Interest shall be
determined in accordance with the calculation set out below. The
Limited Partnership Interests of the Major Limited Partners following
non-contribution by a Major Limited Partner shall be calculated as
follows:

[*] = CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
<PAGE>

-20-

the aggregate of the Contributing Major
Limited Partner's Initial Capital
Contribution plus the additional required
Capital contribution
--------------------------------X [*]%
the aggregate of the Initial Capital
Limited Partnership Interest = Contributions of both Major Limited Partners
of a Major Limited Partner plus the additional required Capital
contribution

For greater clarity, the following examples illustrate the adjustment
to the respective Limited Partnership Interests:

A) FIRST ADDITIONAL CAPITAL CONTRIBUTION:
Initial Capital Contributions of each Major Limited $[*]
Partner:

Limited Partnership Interest: [*]%
additional Capital contribution: $2 million

Limited Partnership Interest of sole Contributing [*] X [*]% = [*]%
Limited Partner "A" after contribution: ---
[*]
B) FUTURE ADDITIONAL CAPITAL CONTRIBUTION:

Limited Partnership Interest: Contributing Limited
Partner
"A": [*]%
Non-contributing
Limited
Partner "B": [*]%
additional Capital contribution: $3 million

Limited Partnership Interest of sole Contributing [*] X [*]% = [*]%
Limited Partner "A" after contribution: ---
[*]

Relative positions of Major Limited Partners: Contributing Limited
Partner
"A": [*]%
Non-Contributing
Limited
Partner "B": [*]%
C) FUTURE ADDITIONAL CAPITAL CONTRIBUTION:
Limited Partnership Interest: Contributing Limited
Partner

[*] = CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
<PAGE>

-21-

Limited Partnership Interest: "A": [*]
Non-Contributing
Limited
Partner "B": [*]%

additional Capital contribution: $2 million

Limited Partnership Interest of Limited [*] X [*]% = [*]%
Partner "A" as non-Contributing Limited Partner ---
[*]

Limited Partnership Interest of Contributing [*] X [*]% = [*]%
Limited Partner "B" ---
[*]

Limited Partnership Interests following 3 capital Limited Partner "A":
[*]%
calls: Limited Partner "B":
[*]%

(b) if, as a result of the application of this Section 6.5,
the Limited Partnership Interest of a Major Limited
Partner falls below 30%, then the number of nominees on
the Board of Directors to which such Major Limited
Partner's corresponding Major Shareholder is otherwise
entitled shall be reduced from 3 to 2 and the number of
nominees of the other Major Limited Partner's
corresponding Major Shareholder shall be increased from
3 to 4;

(c) if the Limited Partnership Interest of a Major Limited
Partner is diluted to 15% or less, the number of
nominees on the Board of Directors to which such Major
Limited Partner's corresponding Major Shareholder is
entitled shall be reduced from 2 to 1 and the number of
nominees of the other Major Limited Partner's
corresponding Major Shareholder shall be increased from
4 to 5; and

(d) if the Limited Partnership Interest of a Major Limited
Partner falls to 15% or below any provision of this
Agreement requiring the consent of both Major Limited
Partners or any provision requiring the consent of both
Major Shareholders pursuant to the Unanimous
Shareholders Agreement shall be read as requiring the
consent only of the Major Limited Partner holding the
greater Limited Partnership Interest or of that Major
Limited Partner's corresponding Major Shareholder as
the case may be.

6.6 ALLOCATION FOR INCOME TAX PURPOSES
----------------------------------

Income and losses of the Limited Partnership shall be determined in
accordance with the Income Tax Act (Canada).

(a) All net losses of the Limited Partnership shall be shared by and
allocated for income tax purposes to the Limited Partners on the following
basis:

[*] = CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
<PAGE>

-22-

(1) With respect to the net losses arising from the first $[*] of expenses
of the Limited Partnership:

(i) the revenues of the Limited Partnership shall be allocated to
each of the Major Limited Partners in proportion to their Limited
Partnership Interest;

(ii) the expenses of the Limited Partnership shall be allocated pro
rata to each Major Limited Partner in accordance with the
Capital Account and the Current Account (excluding revenues) of
such Limited Partner as at the end of each Fiscal Year (or at
the end of any accounting period, as may be appropriate in the
circumstances) provided that for periods ending on or before
December 31, 1998, Tele-Direct's Capital Account shall be
reduced by the amount of the Promissory Note outstanding; and

(iii) the net income or net loss for each Major Limited Partner shall
be its proportionate allocation of revenue (as determined
pursuant to subsection (a)(1)(i)) less its proportionate share
of the Limited Partnership's expenses (as determined pursuant to
subsection (a)(1)(ii) above).

(2) With respect to any additional net losses of the Limited Partnership,
all net losses of the Limited Partnership shall be allocated to each
of the Major Limited Partners in proportion to their Limited
Partnership Interest.

(b) All net income of the Limited Partnership shall be shared by and
allocated for income tax purposes to each of the Limited Partners in
proportion to their Limited Partnership Interest.

6.7 DISTRIBUTIONS TO LIMITED PARTNERS
---------------------------------

(A) DISTRIBUTIONS FROM THE CAPITAL ACCOUNT. All distributions from the
Capital Account to the Limited Partners shall first be to the extent of each
Limited Partner's Initial Capital Contribution, and thereafter proportionate to
each Limited Partner's contributions made in excess of the Initial Capital
Contribution.

(B) DISTRIBUTIONS FROM THE CURRENT ACCOUNT. All distributions from the
Current Account of each of the Limited Partners shall be pro rata in proportion
to each Limited Partner's respective Limited Partnership Interest.

6.8 ALLOCATION IN EVENT OF TRANSFER
-------------------------------

If a Limited Partnership Interest is transferred in accordance with
the terms of this Agreement, all items of income, gain, loss, deduction and
credit of the Limited Partnership shall be allocated between the periods before
and after the Transfer by a "closing of the books"

[*] = CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
<PAGE>

-23-

method. As of the date of such Transfer, the transferee shall succeed to the
Capital Account of the transferor Limited Partner with respect to the
transferred Limited Partnership Interest. This Section 6.8 shall apply for
purposes of computing a Limited Partner's Capital Account.

ARTICLE 7
BUSINESS CONTRIBUTIONS AND OPERATION
------------------------------------

7.1 LOCATIONS WHERE SERVICE WILL BE PROVIDED
----------------------------------------

(a) EXCLUDED TERRITORY. The Limited Partnership shall provide the Limited
Partnership Business in the Exclusive Territory.

(b) BUSINESS WHERE MAJOR LIMITED PARTNERS OPERATE. Subsequently, the
Limited Partnership may carry on the Business in those Canadian cities listed in
Schedule C, as amended from time to time, where both Major Limited Partners
operate.

(c) REST OF CANADA. In those areas of Canada outside the geographic
markets described in Sections 7.1 (a) and (b) hereof, the following shall apply:

(i) In Canadian markets where only one Major Limited Partner has an
operating presence, that Major Limited Partner has the right to
include or exclude the other Major Limited Partner from the
Business carried on in that market. If such Major Limited Partner
chooses to include the other Major Limited Partner in the
Business and the invited Major Limited Partner elects to
participate, the Limited Partnership shall carry on the Business
in that market. If one Major Limited Partner is excluded or
chooses not to be included, then the other Major Limited Partner
may carry on the Business in that market in association with
another local party, and that business association shall have the
right to use the Limited Partnership's know-how and intellectual
property under terms to be agreed to with the Limited Partnership
and the Limited Partners.

(ii) In Canadian markets where neither of the Major Limited Partners
has an operating presence, the two Major Limited Partners may
agree to cause the Limited Partnership to enter that market. If
one Major Limited Partner chooses not to participate, then the
other Major Limited Partner may carry on the Business with
another party, and that business association shall have the right
to use the Limited Partnership's know-how and intellectual
property under terms to be agreed to with the Limited Partnership
and the Limited Partners.
<PAGE>

-24-

(d) WHERE THE PARTIES OPERATE. For the purpose of determining whether a
Limited Partner operates in a given market, the following shall apply:

(i) The determination shall be made immediately prior to the time
that the Limited Partnership or a Limited Partner has notified
the other parties that it is considering operating the Business
in that city.

(ii) As of the date hereof, Torstar/Metroland and Tele-Direct shall be
considered to be operating in the cities listed in Schedule C.

Within 30 days after commencing operation in a new city, a Limited
Partner shall advise the other Limited Partners in writing that it is operating
the Business in that city.

7.2 SITE SELECTION
--------------

The site or sites for the Limited Partnership Business shall be
determined by the Executive Committee, leveraging the brands, where possible,
from Tele-Direct, Metroland, CitySearch Canada or their affiliated corporations
or other affiliated entities.

7.3 CONTRIBUTIONS OF THE LIMITED PARTNERS
-------------------------------------

In addition to any assets that are being contributed pursuant to the
Ancillary Agreements hereto, the initial inputs of the Limited Partners shall be
as follows:

(a) From the date hereof, Torstar/Metroland hereby grants to the Limited
Partnership a royalty-free license to use the know-how and
intellectual property belonging to Torstar ("Torstar/Metroland's
Inputs") as described in Schedule D; and

(b) From the date hereof, Tele-Direct hereby grants to the Limited
Partnership a royalty-free license to use the know-how and
intellectual property belonging to Tele-Direct ("Tele-Direct's
Inputs") as described in Schedule D.

7.4 SUBSEQUENT INPUTS
-----------------

The Limited Partners agree to use their reasonable best efforts to
make available to the Limited Partnership other know-how and intellectual
property that will add value to the Business belonging to them or their
affiliated entities at reasonable market rates.
<PAGE>

-25-

7.5 TELE-DIRECT CONTRIBUTIONS
-------------------------

Tele-Direct will transfer free of charge to the Limited Partnership
the following existing or planned Internet services (and related personnel for
item 4 only) relating to the Exclusive Territory as defined in Schedule A:

Greater Toronto Area ("GTA")
Internet Service Estimated Annual Revenue
---------------- ------------------------------

1. Repurposed Advertisements
for the Internet (upselling from
print based directory)
2. E-mail $[*]
3. URL links (links from online
directory listings to home pages)

4. Web Sites $[*]

Revenues shall accrue to toronto.com for sales or renewals made after
the date hereof.

7.6 EXCLUDED TEP/METROLAND ASSETS AND EXCLUDED TELE-DIRECT ASSETS
-------------------------------------------------------------

(a) EXCLUDED TEP/METROLAND ASSETS. The Limited Partners acknowledge that
Metroland and Torstar Electronic Publishing Ltd. ("TEP"), an Affiliate
of Torstar, have built and currently offer in the Exclusive Territory
certain electronic offerings. The Limited Partners recognize that some
combination of such electronic offerings with the Limited Partnership
Business may be to the mutual advantage of Metroland, TEP and the
Limited Partnership. In the event of such a contribution, details of
which are subject to negotiation, the Limited Partners intend that:
(a) the revenues from TEP's and Metroland's currently existing
business will be excluded from the calculation of the Limited
Partnership's revenue; and (b) the Limited Partnership will share in a
portion of any revenues of Metroland or TEP related to products or
services jointly developed with the Limited Partnership on terms to be
mutually agreed upon by Metroland, TEP and the Limited Partnership.

(b) EXCLUDED TELE-DIRECT ASSETS. The Limited Partners acknowledge that
Tele-Direct and its Affiliates have built and currently offer in the
Exclusive Territory certain electronic offerings. The Limited Partners
recognize that some combination of such electronic offerings with the
Limited Partnership Business may be to the mutual advantage of Tele-
Direct, its Affiliates and the Limited Partnership. In the event of
such a contribution, details of which are subject to negotiation, the
Limited Partners intend that:

[*] = CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
<PAGE>

-26-

(a) the revenues from Tele-Direct and its Affiliates' currently
existing business will be excluded from the calculation of the
Limited Partnership's revenue; and

(b) the Limited Partnership will share in a portion of any revenues
of Tele-Direct and its Affiliates relating to products or
services jointly developed with the Limited Partnership on terms
to be mutually agreed-upon by Tele-Direct, its Affiliates and the
Limited Partnership.

7.7 EXCLUDED ASSETS
---------------

The following assets of each of Metroland and Tele-Direct and their
respective Affiliates are not being transferred to the Limited Partnership as
part of a Major Limited Partner's Capital contributions to the Limited
Partnership but may be available to the Limited Partnership on mutually
satisfactory terms and conditions.

(A) EXCLUDED TORSTAR/METROLAND ASSETS

- Thestar.com
- Torstar.com
- Any national classifieds
content and/or portal services unless entered
into jointly with Tele-Direct.

(B) EXCLUDED TELE-DIRECT ASSETS

- All Internet services outside the Exclusive Territory
- Internet services in association with CANYPS
- Teledirect.com
- Canadayellowpages.com
- Yellowpages.ca / PagesJaunes.ca
- Canadian Trade Index (CTI)
- Caribbean Travel Guide
- Yellowpages of Golf
- BonVoyage.com
- Telecom Directories (Hong Kong)
- Chinese Yellow Pages

7.8 [*]
---------

The General Partner and the Limited Partners agree to consider [*] as
the exclusive portal for the Limited Partnership once [*] has reached a
significant share

[*] = CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
<PAGE>

-27-

([*]%) of the Toronto online subscriber market and relevant traffic which will
be reviewed annually, provided that [*] remains an open system freely
accessible from the World Wide Web.

Tele-Direct will use its best efforts to assist the Limited
Partnership to work with [*] to maximize the exposure of the toronto.com
service.

7.9 CITYSEARCH CANADA COMPETITORS
-----------------------------

The Major Limited Partners agree not to utilize the services of a
Direct Competitor of CitySearch Canada in the Exclusive Territory for the
Limited Partnership Business.

ARTICLE 8
COVENANTS OF LIMITED PARTNERS
-----------------------------

8.1 COVENANTS
---------

Each Limited Partner covenants that, throughout the term of this
Agreement, the Limited Partner shall:

(a) ensure its continued qualification under the laws of its jurisdiction
of incorporation and such jurisdictions where the Limited Partnership
conducts the Limited Partnership Business to the extent it is
reasonably within its power to do so;

(b) subject to the rights and obligations of the Limited Partners pursuant
to the License and Services Agreement and any amendments thereto, the
Limited Partners agree not to disclose or use any confidential or
proprietary information of the other Limited Partner or any of its
Affiliates or of the Limited Partnership to which it may have access
or have disclosed to it by virtue of the Limited Partnership, except
for the purposes of the Limited Partnership and shall ensure that all
persons to whom any such information is disclosed is bound by a duty
of confidence with respect thereto;

(c) not permit any security interest, encumbrance, pledge or other similar
claim to exist against its Limited Partnership Interest or its
interest in any property of the Limited Partnership;

(d) at all times duly and punctually pay and discharge separate and
private debts and engagements whether present or future and keep the
Limited Partnership and the

[*] = CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
<PAGE>

-28-

other Limited Partners indemnified therefrom and from all actions,
proceedings, costs, claims, demands, damages and expenses in respect
thereof; and

(e) maintain its Canadian resident status for purposes of the Income Tax
Act (Canada).

ARTICLE 9
TERMINATION, DISSOLUTION AND NON-COMPETITION
--------------------------------------------

9.1 TERM
----

Except as otherwise provided in this Agreement, the Limited
Partnership created by this Agreement shall begin on the date hereof and shall
continue thereafter until the Limited Partnership is dissolved pursuant to
Section 9.2, or the Limited Partnership is otherwise dissolved by operation of
law, notwithstanding changes from time to time in the Persons who are Limited
Partners.

9.2 DISSOLUTION
-----------

(1) The Limited Partnership may be dissolved in the following manner:

(a) commencing three (3) years from the date hereof, and any time
thereafter, any Limited Partner shall have the right to dissolve the
Limited Partnership upon the occurrence of any one of the following
events:

(i) the financial statements of the Limited Partnership for the
fiscal period ending December 31, 2001 or at the end of any
subsequent twelve (12) month period thereafter, do not show
positive EBITDA; or

(ii) at the end of August 31, 2001 or at the end of any twelve (12)
month period thereafter, toronto.com is not, in the Exclusive
Territory, ranked either first or second among competing,
comparable city guides with similar kinds of features, such
ranking to be determined by an independent web traffic
measurement firm acceptable to all of the Limited Partners, based
upon measurement criteria generally accepted in the industry that
include, but are not limited to, the tracking of traffic and
transactions.

The criteria set forth in the foregoing clause (a)(i) are subject to
reasonable adjustments to take into account changes in the business
focus and/or traffic of toronto.com and adjustments to the Business
Plan agreed upon by the Board of Directors.
<PAGE>

-29-

Upon the occurrence of either of the foregoing events, any Limited
Partner has the right, but not the obligation, to give written notice
to the other Limited Partners that the Limited Partnership shall be
dissolved following thirty (30) days from the date of such notice. At
the end of such thirty (30) day period, the Limited Partnership shall
take all necessary steps to sell its assets and the proceeds therefrom
shall be distributed to the Limited Partners in accordance with
Section 9.2(2) hereof; or

(b) otherwise by operation of law.

(2) Upon sale of all or substantially all of the assets of the Limited
Partnership, or upon dissolution of the Limited Partnership pursuant to either
Section 9.2(1)(a) or (b) above, a full and general account shall be taken of the
assets, credits, debts and liabilities of the Limited Partnership and of the
transactions and dealings thereof and with all convenient speed such assets and
credits shall be sold, realized and collected and the proceeds shall be applied
as follows:

(a) firstly, in paying and discharging the debts and liabilities of the
Limited Partnership to the Persons who are not Limited Partners and
the expenses of and incidental to the dissolution of the Limited
Partnership;

(b) secondly, in paying to each Limited Partner any unpaid debts and
liabilities (including any unpaid net profits) which may be due to it,
including without limitation, payment of the balance, if any, of the
royalty fee payable to CitySearch U.S.A. pursuant to section 4.08 of
the Amended and Restated Licence and Services Agreement; and

(c) thirdly, the balance, if any, of such proceeds and cash, shall be
divided between the Limited Partners proportionately to their Limited
Partnership Interests subject to the provisions of Section 6.7 hereof.

(3) On dissolution of the Limited Partnership, the Board of Directors
shall act as the receiver of the Limited Partnership. If the Board of
Directors shall be unable or unwilling to so act, the General Partner
may appoint some other appropriate Person as receiver of the Limited
Partnership.

ARTICLE 10
INSURANCE
---------

10. INSURANCE
---------

Unless the General Partner directs otherwise, the Limited Partnership
shall maintain insurance in respect of its business, operations and activities,
and the other assets of the
<PAGE>

-30-

Limited Partnership of such types and in such amounts as the Board of Directors
deems advisable including, without limitation, third party liability insurance
and product liability insurance, both during the operation of the Limited
Partnership Business and until any dissolution is completed.

ARTICLE 11
GENERAL
-------

11.1 FURTHER ASSURANCES
------------------

Each Limited Partner shall from time to time execute and deliver all
such further documents and instruments and do all acts and things as the General
Partner may reasonably require to effectively carry out or better evidence or
perfect the full intent and meaning of this Agreement.

11.2 PUBLIC ANNOUNCEMENTS
--------------------

Subject to applicable law or stock exchange regulation, no public
announcement or press release primarily concerning the Limited Partnership shall
be made by any Limited Partner without the prior consent of the General Partner
and joint approval of the other Limited Partners. If a Limited Partner wishes to
issue a press release primarily concerning the Limited Partnership it shall
provide a draft thereof (or the portion thereof relating to the Limited
Partnership) to the General Partner and the other Limited Partners as soon as a
draft is available and shall consider any reasonable comments of the General
Partner and the other Limited Partners with respect to the press release
provided that such comments are provided forthwith upon receipt of the draft.
Any failure to provide comment with respect to a draft press release within
three (3) Business Days shall be deemed to constitute consent to the release
thereof.

11.2 BENEFIT OF THE AGREEMENT
------------------------

This Agreement shall enure to the benefit of and be binding upon the
respective successors and permitted assigns of the parties hereto.

11.4 ENTIRE AGREEMENT
----------------

This Agreement, the Unanimous Shareholder Agreement and the Ancillary
Agreements constitute the entire agreement between the parties hereto with
respect to the subject matter hereof and cancel and supersede any prior
understandings and agreements between the parties hereto with respect thereto
including a term sheet entitled, "CitySearch-Term Sheet for Partnership
Agreement" dated July 16, 1998 and the initialled addendum attached thereto.
There are no representations, warranties, terms, conditions, undertakings or
collateral agreements, express, implied or statutory, between the parties other
than as expressly set forth in this Agreement, the Unanimous Shareholders
Agreement or the Ancillary Agreements.
<PAGE>

-31-

11.5 DISPUTE RESOLUTION
------------------

If any difference or dispute shall arise among the parties hereto in
respect of any matter arising out of this Agreement, including, without
limitation, the interpretation of any provision hereof, such difference or
dispute shall, unless settled by agreement between or among the disputing
parties be submitted to arbitration by a single arbitrator, if the parties can
agree on one. Any such arbitration shall be conducted in accordance with the
provisions of the Arbitration Act (Ontario), as from time to time amended or
replaced. If the parties fail to appoint an arbitrator within seven (7) days of
reaching agreement to resolve the dispute by arbitration, any one of the parties
in dispute may apply to a judge of the Ontario Court (General Division) to
appoint an arbitrator. The arbitrator so appointed shall forthwith proceed to
arbitrate the dispute. The cost of the arbitration shall be paid as determined
by the arbitrator. Despite anything to the contrary contained in the
Arbitration Act (Ontario) the decision arrived at by the arbitrator shall be
final and binding upon the parties and all Persons claiming through or under
them and no appeal shall lie from any award of the arbitrator.

11.6 AMENDMENT AND WAIVER
--------------------

This Agreement may be amended on the initiative of the General Partner
with the consent of the Limited Partners. No waiver of any breach of any term
or provision of this Agreement shall be effective or binding unless made in
writing and signed by the party purporting to give the same and, unless
otherwise provided, shall be limited to the specific breach waived.

11.7 ASSIGNMENT
----------

Except as may be expressly provided in this Agreement, no Limited
Partner may assign its rights or obligations under this Agreement without the
prior written consent of the General Partner and the other Limited Partners.

11.8 NOTICES
-------

Any demand, notice or other communication to be given in connection
with this Agreement shall be given in writing and shall be given by personal
delivery or by transmittal by electronic means of communication addressed to the
recipient as follows:
<PAGE>

-32-

For the General Partner:

1 Yonge Street
Toronto, Ontario
M5E 1E6

Attention: Chairperson
Fax No.: (416) 865-3618

For Tele-Direct:

325 Milner Avenue, Suite 1050
Scarborough, Ontario M1B 5S8

Attention: Mr. Douglas G. Renwicke
Fax No.: 416-412-5870
with a copy to:

325 Milner Avenue, Suite 1050
Scarborough, Ontario M1B 5S8
Attention: Mr. Shaul I. Ezer
Vice-President, General Counsel and Secretary
Fax No.: 416-412-5858

<PAGE>

-33-
For Metroland or Torstar:

c/o Torstar Corporation
1 Yonge Street
Toronto, Ontario
M5E 1P9

Attention: Mr. David Wetherald
General Counsel and Secretary
Fax. No.: (416) 869-4183

with a copy to:

Toronto Star Newspapers Limited
1 Yonge Street
Toronto, Ontario
M5E 1E6

Attention: Mr. Rocco Rossi
Vice-President, Strategic Planning & New Media
Fax No.: (416) 865-3618

To CitySearch Canada or CitySearch U.S.A.:

c/o CitySearch, Inc
790 East Colorado Boulevard
Suite 200
Pasadena, California 91101
U.S.A.

Attention: Douglas McPherson, Chief Legal Officer
Fax No.: (626) 405-9929

with a copy to:

Attention: Bradley Ramberg
Chief Financial Officer
Fax No.: (626) 405-9929

or to such other address, electronic communication number or individual as may
be designated by notice given by the General Partner or any Limited Partner to
the others. Any communication shall be conclusively deemed to have been given
on the day of actual delivery thereof if such day is a Business Day and the
communication is delivered or transmitted during the normal business
<PAGE>

-34-

hours of the recipient and on the Business Day during which normal business
hours next occur if given after such hours on any day.

11.9 GOVERNING LAW
-------------

This Agreement shall be governed by and construed in accordance with
the laws of the Province of Ontario and the laws of Canada applicable therein.

11.10 LIMITED PARTNER NOT A GENERAL PARTNER
-------------------------------------

In the event that any provision of this Agreement should have the
effect of imposing upon a Limited Partner any of the obligations of the General
Partner, such provision shall be of no force and effect and shall not be part of
this Agreement, but the remainder of this Agreement shall continue in effect.

11.11 COUNTERPARTS
------------

This Agreement may be executed in any number of counterparts with the
same effect as if all the parties hereto had executed the same document. All
counterparts shall be construed together and shall constitute one agreement.

IN WITNESS WHEREOF the parties hereto have executed this Agreement.

1310818 ONTARIO INC.

Per: /s/ D. G. Renwicke
---------------------------------

_____________________________________

TELE-DIRECT (SERVICES) INC.

Per: /s/ D. G. Renwicke
---------------------------------

_____________________________________
<PAGE>

-35-

METROLAND PRINTING, PUBLISHING & DISTRIBUTING LTD.

Per: /s/ David Wetherald
---------------------------------

_____________________________________

CITYSEARCH CANADA INC.

Per: /s/ Michael Barton
---------------------------------

CITYSEARCH, INC.

Per: /s/ Michael Barton
---------------------------------

TORSTAR CORPORATION

Per: /s/ David Wetherald
---------------------------------

_____________________________________

TELE-DIRECT (PUBLICATIONS) INC.

Per: /s/ D. G. Renwicke
---------------------------------

_____________________________________
<PAGE>

EXHIBIT A

PROMISSORY NOTE
---------------

AMOUNT: $[*]CDN) AUGUST 31, 1998

FOR VALUE RECEIVED, the undersigned hereby promises to pay to or to
the order of Toronto.com, a limited partnership, at Toronto, Ontario or such
other place as the Limited Partnership may direct in writing, the sum of [*]
Dollars ($[*]) (the "Principal Amount"), all in lawful money of Canada,
and payable in accordance with, and subject to, the provisions regarding the
payment of such amount set forth in this Promissory Note.

This Promissory Note is issued pursuant to and is subject to certain
provisions of a limited partnership agreement between, among others, 1310818
Ontario Inc., Tele-Direct (Services) Inc., Metroland Printing, Publishing &
Distribution Ltd. and CitySearch Canada Inc., made as of the 31st day of August,
1998 (the "Limited Partnership Agreement"). In the event of any inconsistency
between the terms of this Promissory Note and the terms of the Limited
Partnership Agreement, the terms of the Limited Partnership Agreement shall
govern to the extent of any such inconsistency. All capitalized terms used
herein unless otherwise defined shall have the meaning ascribed thereto in the
Limited Partnership Agreement.

The sum of [*] Dollars ($[*]) of the Principal Amount shall be due and
payable on February 26, 1999 and the sum of [*] Dollars ($[*]) of the Principal
Amount shall be due and payable on May 28, 1999, or on such earlier dates as
determined by the Board of Directors of the General Partner.

The Principal Amount shall bear interest from the date such sums are
due, calculated on the daily balance of such sums. Interest shall be payable
monthly on the last day of each month at Toronto, or at such other place as the
Limited Partnership shall direct in writing, after maturity, default and
judgment, at the rate per annum quoted by Canadian Imperial Bank of Commerce
("CIBC") from time to time as its prime rate for Canadian dollar commercial
loans made in Canada, adjusted automatically from time to time upon change by
CIBC without notice to the undersigned, and interest on overdue interest payable
at the same time, place and rate.

The undersigned waives presentment for payment, notice of dishonour,
notice of non-payment, protest and notice of protest in respect of this
Promissory Note.

The rights or obligations under this Promissory Note may not be
assigned or otherwise transferred.

This Promissory Note shall be governed by and construed in accordance
with the laws of the province of Ontario and the laws of Canada applicable
therein and the undersigned hereby attorns to the jurisdiction of the courts of
the province of Ontario for all purposes relating to this Promissory Note.

[*] = CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
<PAGE>

-2-

This Promissory Note is binding upon the undersigned and its
successors and permitted assigns and is for the benefit of the Limited
Partnership and its successors and permitted assigns.

DATED this 31st day of August, 1998.

TELE-DIRECT (SERVICES) INC.

By:_____________________________
Its:____________________________
<PAGE>

SCHEDULE A

AREA MAP OF THE EXCLUSIVE TERRITORY
-----------------------------------

[The northern boundary of the territory is indicated on a map of the greater
Toronto area as extending roughly from Dillon in the northwest corner, east to a
point slightly northeast of Millar Hill. The eastern border is indicated as
extending roughly from a point slightly northeast of Millar Hill, south to a
point slightly west of Moore Falls, then southwest to Barriefield. The southern
border is indicated as extending roughly from Barriefield southwest along Lake
Ontario to Dundas. The western border is indicated as extending roughly from
Dundas northwest to a point slightly south of Marden, north to Collingwood, then
along Nottawasaga Bay and Georgian Bay to Dillon.]

<PAGE>

SCHEDULE B

DESCRIPTION OF THE LIMITED PARTNERSHIP'S BUSINESS
-------------------------------------------------

(a) GENERAL. The Limited Partnership's business shall be to develop and
-------
operate local on-line services (with content comprising local news and
information, local events, yellow pages business directories, and with
classified advertising content relating to jobs, automotive, real estate
and other classifications) that facilitate communication and business
transactions for internet users, generating revenue from advertising and
electronic commerce transactions in the Exclusive Territory ("the
Exclusive Territory") described in Schedule A. The Limited Partnership's
business shall include:

- - To create a new entity in the local, online city directory and guide
business to operate as toronto.com

- - Building on the above, to create the best platform of local information
that facilitates communication and business transactions for Internet users

- - This platform will become a focal point for [*]

- - Content for the Toronto area local online directory and guide is not
limited to, but generally includes the following categories:

(a) Yellow Pages (TM) Business Directory (Tele-Direct)

(b) Classified Advertising (Star)

- - [*]

Note: The Major Limited Partner shall contribute the above elements to
toronto.com royalty-free, subject to any royalty that may have to be paid to a
third party.

[*] = CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.

<PAGE>

SCHEDULE C

CITIES/REGIONS IN WHICH TORSTAR/METROLAND OPERATE
- -------------------------------------------------

[*]

[*] = CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.

[*]

CITIES/REGIONS IN WHICH TELE-DIRECT OPERATES
- --------------------------------------------

[*]

[*] = CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
<PAGE>

SCHEDULE D

INPUTS
------

TORSTAR/METROLAND INPUTS
- ------------------------

1) License to use various Torstar affiliate logos and trademarks, including
"The Toronto Star"

2) Reciprocal links from thestar.com and torstar.com

3) Filler ad cross promotion support from Torstar print properties and
Toronto Star Television

4) Piggyback on local promotions - events and sponsorship opportunities

CITYSEARCH INPUTS
- -----------------

Amended and Restated License and Services Agreement dated as of August 31, 1998
Toronto.com Sublicense and Services Agreement dated as of August 31, 1998

TELE-DIRECT INPUTS
- ------------------

1. Yellow Pages Business Listings Data for the Exclusive Territory - Updated
Monthly -Initial and Update

2. 700 Digital Photos of GTA Restaurants

3. 500 Plus Enhanced Restaurants Listings in GTA - Food Type, Dress Code,
etc.

4. License to use Yellow Pages (TM) Logo and Trademark

5. Yellow Pages.ca/PagesJaunes.ca Links (reciprocal)

6. Filler ad Cross Promotion Support from Yellow Pages (TM) Print Business

7. Piggyback on Local Promotion - Events and Sponsorship Opportunities

Note: (1) Item 4 is subject to the Limited Partnership executing the
standard form license agreement in use by Tele-Direct (Publications) Inc., the
owner of the Logo and Trademark.
<PAGE>

(2) Item 1 is subject to restrictions or prohibitions that may be imposed
by the local telephone company or the CRTC.
<PAGE>

SCHEDULE E

LIMITED PARTNERSHIP INTEREST
----------------------------

LIMITED PARTNERSHIP INTERESTS AS OF AUGUST 31, 1998
- ---------------------------------------------------

GENERAL PARTNER

1310818 Ontario Inc. 0.1%

LIMITED PARTNERS

Tele-Direct 44.96%
Metroland 44.96%
CitySearch Canada 9.98%

<PAGE>

EXHIBIT 10.29

License and Services Agreement ("Agreement") is made and
entered into as of August 12, 1998, by and between
Ticketmaster Corporation, an Illinois corporation ("TM
Corp"); Ticketmaster Multimedia Holdings, Inc., a Delaware
corporation ("TMOL") and USA Networks, Inc. ("USAi").
----------------------------------------------------------

Introduction
------------

The parties have entered into an Agreement and Plan of Reorganization
("Reorganization Agreement") of even date herewith under which TMOL became a
wholly-owned subsidiary of CitySearch, Inc. ("CitySearch"). TMOL was,
immediately prior to the effective date of the merger consummated pursuant to
the Reorganization Agreement, a wholly-owned subsidiary of TM Corp, serving as
Online (as defined below) distribution agent for TM Corp and, upon effectiveness
of the merger, remains an indirect subsidiary of TM Corp.

As part of the transaction described in the Reorganization Agreement
and pursuant to this Agreement, Ticketmaster Companies are formally designating
TMOL as their exclusive agent for Online distribution of TM Tickets serving TM
Corp's Client Venues and are granting to TMOL the right to use the
"Ticketmaster" logos and related trademark and service mark rights in connection
with the online sales of tickets and merchandise.

In consideration of the foregoing premises and the respective
representations, warranties, covenants and agreements set forth herein, and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto agree as follows:

ARTICLE I

DEFINITIONS

1.1 Definitions. The following terms shall have the meanings set
-----------
forth below for all purposes under this Agreement.

"Affiliate" of an entity means (i) any entity controlled by,
controlling, or under common control with such first entity, where "control"
means ownership, either direct or indirect, of more than 50% of the equity
interest entitled to vote for the election of directors or equivalent governing
body and/or (ii) any entity of which such first entity has possession, either
direct or indirect, of the power to direct or cause the direction of management
and policies of the second entity through ownership of voting securities, by
contract or otherwise. Notwithstanding the foregoing, neither TMOL, CitySearch
nor either of their majority-owned subsidiaries will be considered to be an
Affiliate of TM Corp or any of the Ticketmaster Companies for the purposes of
this Agreement.

-9-

<PAGE>

"Client Venue Agreement" means a contract, agreement or arrangement
for the distribution of tickets on behalf of a Venue to which any Ticketmaster
Company is a party.

"Client Venues" means Venues which are parties to Client Venue
Agreements.

"Confidential Information" means any information disclosed by one
party to the other pursuant to this Agreement, either orally or in writing,
which is designated "Confidential," "Proprietary" or in some similar manner.

"Consumers" means parties buying Tickets or Merchandise.

"Fees" means any fees or charges (including without limitation
convenience charges, shipping and handling charges, TMOL Inside Charges, license
fees and sales and use taxes) payable to a Ticketmaster Company in respect of
Online Ticket sales.

"Merchandise" means goods or services other than tickets.

"Online" means electronic interactive services that are available via
public or private computer networks such as the Internet (e.g. the World Wide
Web), proprietary online services such as America Online and hybrid Internet
services such as WebTV and @Home. In the event that other electronic
interactive services emerge that would facilitate the sale of Tickets, the
parties pledge to make a good faith effort to integrate those services into this
Agreement, where appropriate. "Online" does not mean media such as non-
interactive cable television, satellite television, broadcast television, or the
like. The parties acknowledge that this definition also does not include voice-
to-voice or VRU based telephone services, kiosks dedicated exclusively to ticket
sales or retail ticket outlets.

"Online Ticketing and Sales" means the portion of any sale or
attempted sale of Tickets or Merchandise by Online means during which (a) the
Consumer provides specific transaction information such as quantity and type of
Tickets or Merchandise requested for purchase; (b) Inventory Data is accessed,
utilized, manipulated or displayed; (c) the Consumer provides personal data such
as name, billing and shipping address, and credit card or other payment
information; (d) the Consumer becomes bound to the purchase of the Tickets or
Merchandise; or (e) steps in an attempted or completed purchase and sale
transaction occur that are substantially equivalent to any of (a) through (d).

"Online Promotion" means the portion of any sale, attempted sale or
promotion of Tickets or Merchandise by Online means which does not constitute
Online Ticketing and Sales.

"Territory" means the United States, Canada and the United Kingdom,
their territories and possessions.

"Ticket" means tickets or reservations for individual (not group or
season) sale to the general public for any event or attraction, that may be
sold, distributed or promoted under a Trademark, excluding only travel and
lodging, for which a convenience charge has been received and retained, not sold
at a box office for the Client Venue.

-2-
<PAGE>

"ticketmaster.com" means all Web sites and pages located at the domain
name ticketmaster.com or any subdomains thereof and successors consistent with
the definition of Online.

"Ticketmaster Companies" means USAi, Ticketmaster Group, Inc., TM
Corp, and all their respective Affiliates, whether existing now or in the
future, other than CitySearch or TMOL or any of the majority-owned subsidiaries
of CitySearch or TMOL.

"TM Data" means the database maintained by TM Corp or its subsidiaries
containing, among other things, publicly available data regarding Client Venues
("Venue Data"); confidential data regarding Consumer Online sales, demographic
and other data relating to Online sales ("Consumer Data"); publicly available
data regarding performances, events and attractions ("Event Data"); publicly
available data regarding TM Merchandise ("Merchandise Data"); and confidential
data regarding inventories of Tickets for Client Venues or TM Merchandise
("Inventory Data").

"TM Domain Names" means the domain names listed on Exhibit F.

"TM Merchandise" means any goods or services that TM Corp or its
subsidiaries may sell or have the right to sell to Consumers in any manner,
including without limitation through Online distribution.

"TM Ticket" means any Ticket that any Ticketmaster Company may sell or
provide to Consumers pursuant to a Client Venue Agreement.

"TMOL Inside Charges" means per Ticket during any year the "Online
Percentage" of the excess of inside charge per Ticket in such year over the
inside charge per Ticket in 1998 escalating at 5% per year thereafter where (i)
the inside charge per Ticket is determined for this clause only based on
telephone, box office, Online and outlet Ticket sales and (ii) "Online
Percentage" is the number of TM Tickets sold Online as a percentage of total TM
Tickets sold for such year.

"Trademarks" means the marks identified in Exhibit D incorporating the
word "Ticketmaster," and any other logos, trademarks, service marks, and the
like incorporating the word "Ticketmaster" that the Ticketmaster Companies may
adopt from time to time using the Ticketmaster name in connection with the
distribution of Tickets.

"Venues" means entities that own or control the sale of Tickets.

1.2 Interpretations. Except as otherwise expressly provided in this
---------------
Agreement, the following rules of interpretation apply to this Agreement: (i)
the singular includes the plural and the plural includes the singular; (ii) "or"
and "any" are not exclusive and "include" and "including" are not limiting;
(iii) a reference to any agreement or other contract includes permitted
supplements and amendments; (iv) a reference to a law includes any amendment or
modification to such law and any rules or regulations issued thereunder; (v) a
reference to a person includes its permitted successors and assigns; (vi) a
reference to generally accepted accounting principles refers to United States
generally accepted accounting

-3-
<PAGE>

principles; and (vii) a reference in this Agreement to an Article, Section,
Annex, Exhibit or Schedule is to the Article, Section, Annex, Exhibit or
Schedule of this Agreement.

ARTICLE II

LICENSE, AGENCY

2.1 Licenses; Agencies. Subject to the continued compliance by TMOL
------------------
with all of the material terms and conditions of this Agreement:

(a) Trademark License. TM Corp, on behalf of Ticketmaster Companies,
-----------------
hereby grants to TMOL as follows:

(i) the exclusive, perpetual, irrevocable, worldwide right to
use the Trademarks to designate the source or origin of TM Tickets in connection
with Online Ticketing and Sale of TM Tickets;

(ii) the exclusive, perpetual, irrevocable right to use the
Trademarks to designate the source or origin of TM Merchandise in connection
with the Online Ticketing and Sale of TM Merchandise to shipping addresses
within the Territory;

(iii) the non-exclusive, perpetual, irrevocable right to use the
Trademarks to designate the source or origin of TM Merchandise in connection
with the Online Ticketing and Sale of TM Merchandise to shipping addresses
outside the Territory;

(iv) the non-exclusive, perpetual, irrevocable, worldwide right
to use the Trademarks in connection with Online Promotion of TM Tickets and TM
Merchandise, including without limitation the right to display the Trademarks on
Web sites of TMOL and the right to use the Trademarks on promotional and
advertising materials in connection with Online Ticketing and Sale and Online
Promotion of TM Tickets and TM Merchandise; and

(v) the exclusive, perpetual, irrevocable right to use the TM
Domain Names.

(b) Use of TM Data. TM Corp, on behalf of Ticketmaster Companies,
--------------
hereby grants to TMOL the exclusive (to the extent set forth below in
subparagraph (v)), worldwide, perpetual, irrevocable license to use the TM Data
in connection with the operation of the TMOL business as follows:

(i) Inventory Data is confidential and may be used by TMOL
solely in connection with Online Ticketing and Sales to individual
Consumers, and may not otherwise be used by TMOL. In particular, TMOL may
not on its own behalf systematically access, or permit any third party
systematically to access, the Inventory Data in order to view or duplicate
any portion of the Inventory Data database other than as necessary in
connection with individual bona fide Online Ticketing and Sales.

-4-
<PAGE>

(ii) Consumer Data is confidential and may be used by TMOL solely
in connection with bona fide Online Ticketing and Sales, advertising,
direct mail and Online Promotion conducted by TMOL on its own behalf.

(iii) Except as required pursuant to Client Venue Agreements
and the Agreements listed on Exhibit G, Venue, Event and Merchandise Data
may be used by TMOL on its own behalf but not licensed, sold or leased to
third parties. TMOL may use such Venue, Event and Merchandise Data solely
in connection with use of one or more appropriate Trademarks branding the
web page, display or advertisement in which such Venue, Event and
Merchandise Data is used or otherwise in connection with the proximate use
of one or more appropriate Trademarks.

(iv) The restrictions contained in subparagraphs (i) through
(iii) above shall not apply to the extent that any TM Data that becomes
known to TMOL from a source other than TM Corp or its Affiliate and is
subject to less restrictive usage requirements.

(v) Except as may be provided for in any Client Venue Agreements
or any agreements to which the Ticketmaster Companies are party as of the
date hereof that are listed in Exhibit G, the Ticketmaster Companies shall
not authorize any third party to use TM Data Online.

(c) TM Tickets. TM Corp, on behalf of Ticketmaster Companies, hereby
----------
appoints TMOL as worldwide, exclusive, perpetual agent for the Online Ticketing
and Sale and Online Promotion of TM Tickets in accordance with the terms of the
Client Venue Agreements. Except as required under this Agreement, TM Corp
agrees on behalf of Ticketmaster Companies that Ticketmaster Companies shall not
engage in Online Ticketing and Sale and Online Promotion of TM Tickets, or grant
to any other party the right to engage in such actions, or use the Trademarks in
connection with such actions or cooperate with in any way or grant to any other
party the right to use the Trademarks in connection with Online Ticketing and
Sale and Online Promotion of TM Tickets. In the case of any country in which
there is a Client Venue for which TM Corp or an Affiliate has acquired rights to
conduct Online Ticketing and Sales and Online Promotion of TM Tickets for such
Client Venue, upon the request of TM Corp, TMOL shall use commercially
reasonable efforts to develop a Web site or similar Online content, as TM Corp
may request, enabling the Online Ticketing and Sale of TM Tickets in a form and
language appropriate to such country.

(d) Merchandise. TM Corp, on behalf of Ticketmaster Companies, hereby
-----------
appoints TMOL as non-exclusive, worldwide agent for the Online Ticketing and
Sale and Online Promotion of TM Merchandise. TMOL may sell Other Merchandise,
subject to Sections 2.2. TM Corp agrees on behalf of Ticketmaster Companies
that Ticketmaster Companies shall not grant to any other party the right to
serve as agent for, or cooperate with in any way or grant to any other party the
right to use the Trademarks in connection with, the Online Ticketing and Sale of
TM Merchandise for shipping addresses in the Territory.

-5-
<PAGE>

2.2 Other Agreements. TMOL's rights under Section 2.1 and this
----------------
Agreement are subordinated and subject to any rights retained by such Client
Venues under any Client Venue Agreement, and subordinated and subject to all
other agreements to which the Ticketmaster Companies are subject as of the date
hereof that are listed in Exhibit G. TMOL shall not breach the terms and
provisions of any Client Venue Agreements or other agreements to which the
Ticketmaster Companies are party provided or made available to TMOL by the
Ticketmaster Companies that are applicable to TMOL's activities under this
Agreement, nor breach the terms or provisions of such agreements about which TM
Corp has given TMOL notice; provided, however, that TMOL will not be deemed in
breach of this provision unless such breach remains uncured for the cure period
in the underlying contract provided that TM Corp gives notice to TMOL (including
notice of the relevant cure period) thereof describing such breach and the
relevant contract terms.

2.3 TMOL Marketing Partners and Affiliates. Subject to the consent
--------------------------------------
of TM Corp, which consent shall not be unreasonably withheld, TMOL may
sublicense the rights granted above and appoint distribution agents to perform
Online Ticketing and Sale and Online Promotion of TM Tickets and TM Merchandise
to any TMOL business associates operating city guide Web sites and approved by
TM Corp, in connection with the operation of such sites. Any such sublicense or
distribution arrangement shall be on terms approved by TM Corp, whose approval
shall not be unreasonably withheld. TMOL may also allow any TMOL Affiliate
agreeing to comply with the terms of this Agreement to exercise any right
hereunder.

ARTICLE III

MARKETING AND USE OF TRADEMARKS

3.1 ticketmaster.com. At all times during the term of this
----------------
Agreement, TMOL shall conduct Online Ticketing and Sales solely by means of the
ticketmaster.com domain or subdomains thereof, including
ticketing.ticketmaster.com, or in the case of Consumers making use of Online
communications not part of the World Wide Web, such as America Online and other
proprietary Online services, solely by means of technology authorized by TM
Corp, which authorization shall not be unreasonably withheld. Without limiting
Article II, TMOL may conduct Online Promotion by means of ticketmaster.com and
subdomains thereof. TMOL shall consult with TM Corp regarding Online Promotion
by other Online means. TMOL shall perform any Online Promotion by other Online
means in good faith, and subject to Section 2.2.

3.2 TMOL Sponsorships. TMOL shall comply with the trademark use
-----------------
guidelines in Exhibit C regarding sponsorships, advertising or promotions
arranged and sold by TMOL to third parties involving ticketmaster.com. Any use
not allowed by such guidelines will be subject to the prior approval of TM Corp,
which will not be unreasonably delayed or withheld. TM Corp and TMOL will
develop a working relationship for daily review of the content of
ticketmaster.com for uses requiring prior approval.

3.3 Compliance with Laws. Each party shall comply with all
--------------------
applicable laws, statutes and regulations with respect to such parties'
obligations under this Agreement.

-6-
<PAGE>

3.4 Ownership. TMOL acknowledges and admits the validity of the
---------
Trademarks and covenants that it will not directly or indirectly contest the
validity of the Trademarks or the right and title of TM Corp therein and
thereto. All uses to be made by TMOL or its permitted sublicensees, if any, of
the Trademarks shall inure to the benefit of TM Corp. TMOL and its permitted
sublicensees, if any, shall acquire no right, title or interest in the
Trademarks or any goodwill associated therewith apart from the rights granted to
TMOL herein. This Agreement shall not affect TM Corp's right to enjoin or
obtain relief against any acts by third parties of trademark infringement or
unfair competition. At the request of TM Corp, TMOL shall, and shall cause any
of its permitted sublicensees to, execute and deliver any and all documents
necessary to enter TMOL or its permitted sublicensees thereof as registered
users of the Trademarks in each country of use to the extent required by
applicable law.

3.5 Quality Control. All uses by TMOL of the Trademarks shall meet
---------------
commercially reasonable standards of quality, which includes but is not limited
to the quality of the services and products heretofore distributed or provided
by TM Corp, or shall meet such other reasonable standards and specifications as
may be set by TM Corp and communicated to TMOL from time to time, including but
not limited to any fair practices requirements that TM Corp may reasonably
promulgate, such as prohibitions on brokering, scalping and unauthorized release
of Tickets, and similar requirements appropriate to the Online environment.
Upon TM Corp's request from time to time, TMOL shall provide to TM Corp
representative samples of its uses of the Trademarks or permit TM Corp to
inspect TMOL's places of business where the Trademarks are used.

3.6 Maintenance and Protection of Trademarks.
----------------------------------------

(a) Maintenance of Trademarks. TM Corp shall use commercially
-------------------------
reasonable efforts to maintain all registrations and prosecute all applications
for registration in the Trademarks. TM Corp shall include, to the extent
legally permissible and commercially reasonable, Online Ticketing and Sale of
TM Tickets and TM Merchandise in connection with any descriptions of use in any
applications to be filed for trademark registrations. At TM Corp's reasonable
request, TMOL, at TMOL's expense, shall furnish evidence of use as may be
reasonably required for such maintenance, and shall execute all documents as TM
Corp reasonably requests in order to maintain a registration or establish or
maintain TM Corp's ownership of the Trademarks.

(b) Trademark Legends. TMOL shall use any trademark notice that TM
-----------------
Corp deems advisable. In connection herewith, TMOL may use the encircled R
("(R)"), service mark ("?") or trademark ("") designations, as appropriate, the
first and most prominent time each Trademark is used, and may use the following
legend:

"[Trademark(s)] [is a/are] [federally-] [registered trademark(s)]
owned by Ticketmaster Corporation and [is/are] used under license."

(c) Infringement. Each party will notify the other party of any and
------------
all infringements, imitations or illegal uses of the Trademarks that come to
such party's attention. TM Corp shall have the right, and to the extent
commercially reasonable, the obligation, to

-7-
<PAGE>

prosecute, defend and conduct, at the expense of the party on whose behalf such
actions are being taken, all proceedings or actions involving the Trademarks and
to take any actions that it may deem proper or necessary for the protection of
the Trademarks. Upon TM Corp's request, TMOL and its permitted sublicensees, if
any, shall cooperate fully with TM Corp in connection with any such actions. The
proceeds, if any, of any such actions shall be paid to the party at whose
expense such actions were taken. TMOL shall have no right to prosecute, defend
or conduct any such proceedings or actions.

3.7 Reservation of Rights. TM Corp hereby reserves all rights,
---------------------
including title, to trademarks, domain names, URLs and data not expressly
granted in this Agreement and the right to continue to use as E-mail addresses
@ticketmaster.com.

ARTICLE IV

SERVICES

4.1 TM Corp Services. TM Corp shall provide the following services:
----------------

(a) Ticket and Merchandise Fulfillment Services. TM Corp, directly or
-------------------------------------------
through any Ticketmaster Company, shall provide the services described in
Exhibit A to TMOL, with no less than the same level of service generally as
currently provided by TM Corp to TMOL for Online Ticketing and Sales and Online
Promotion (subject to appropriate adjustments for changes in market conditions).

(b) Other Merchandise Fulfillment. One or more of the Affiliates of
-----------------------------
TM Corp, to be designated by TM Corp (the "TM Fulfillment Entity"), shall
provide to TMOL services for the fulfillment of orders for Merchandise other
than TM Merchandise sold through the TMOL City Guide Web sites or other Web
sites to be operated or owned by TMOL ("Other Merchandise"). TMOL will
reimburse TM Corp for the direct cost of the Other Merchandise and pay to TM
Corp a fee at competitive prices. TMOL shall reimburse TM Corp or the TM
Fulfillment Entity for actual direct expenses relating to these services.

4.2 TMOL Services. TMOL agrees to act as the Ticketmaster Companies'
-------------
agent for Online distribution of Tickets, and in connection with such agreement
to promote the Online sale of Tickets.

4.3 Exclusivity. Subject to TM Corp's performance of its obligations
-----------
under Sections 4.1.(a) and 4.1(b), TMOL shall not use any party other than the
TM Fulfillment Entity to provide services to TMOL for the fulfillment of orders
for TM Merchandise and Tickets. Provided that the TM Fulfillment Entity's fees,
aggregate terms, and quality of service for fulfillment of orders for Other
Merchandise are no worse than those available from third parties, TMOL shall not
use any party other than the TM Fulfillment Entity to provide services to TMOL
for the fulfillment of orders for Other Merchandise.

4.4 TM Database Services. TM Corp shall make the TM Data available
--------------------
for TMOL in the same manner TM Corp currently provides such TM Data to TMOL. TM
Corp

-8-
<PAGE>

will use commercially reasonable efforts to provide other data base services
requested by TMOL, such as data mining of the TM Data and data warehousing, on
mutually acceptable terms and conditions, at TMOL's expense at reasonable rates.

ARTICLE V

REVENUES AND PAYMENTS

5.1 Revenue Recognition. The parties agree that Fees are intended to
-------------------
be recognizable revenue of TMOL. If this Article does not accomplish the
intended purposes, the parties will negotiate in good faith to make appropriate
revisions to achieve the intended purpose.

5.2 Payment of Fees. TM Corp shall pay to TMOL all Fees collected by
---------------
TM Corp or any Ticketmaster Company during such week for all sales from Monday
through Sunday for a given week, on the subsequent Friday, in respect of Online
Ticket sales less (i) all Client Venues' share of such Fees, (ii) royalties to
TM Corp in respect of such Fees on an average basis, and (iii) reimbursement for
direct expenses in respect of Online Ticket sales for the services as provided
in Section 5.3.

5.3 Expenses. TM Corp shall provide TMOL monthly invoices showing
--------
direct expenses according to the Expense Guidelines set forth in Exhibit B. TMOL
shall reimburse TM Corp (or the appropriate Ticketmaster Company described in
Section 4.1(a) or the TM Fulfillment Entity described in Section 4.1(b)) for
such expenses not previously reimbursed, no later than 15 days after receipt of
such invoice; provided, however, that in no event shall TMOL be obligated to pay
expenses under this Section 5.3 in excess of Fees received under Section 5.2.

5.4 Royalties. Royalties for the purposes of Section 5.2 shall equal
---------
[*]% of "Profit," where Profit for any period means Fees payable to TMOL under
Section 5.2 (including without limitation convenience charges with respect to
Ticket sales and shipping and handling revenue related to Tickets) minus all
direct expenses related to Ticket sales (including without limitation all direct
expenses such as third party royalties, direct operations costs for operation
and maintenance of TM Corp's gateway servers and communications links from TM
Corp's database to TMOL's Web servers, data line costs, the reasonable costs of
creating, maintaining, operating and upgrading (other than costs that are
capitalized in accordance with generally accepted accounting procedures) the
ticketmaster.com Web site, costs associated with lost Tickets, secondary
commissions, credit card and other payment

processing expense, credit card charge-backs, shipping and handling costs for TM
Ticket sales, sales and use taxes, and refunds payable under Section 5.5)
incurred by TMOL, including

-9-
<PAGE>

without limitation those expenses reimbursed to TM Corp under Section 5.3. The
parties acknowledge that such royalties will be deductible expenses of TMOL.

5.5 Returns and Refunds. TMOL shall return to TM Corp any amount
-------------------
received in respect of tickets that subsequently are refunded or for which TM
Corp does not receive a convenience charge. TM Corp will have the right to
offset from its remittances of Fees any amounts due Consumers for return of
tickets and any amounts due TM Corp or its Client Venues, including charge-
backs.

5.6 Quarterly True-Up. At the end of each calendar quarter, TM Corp
-----------------
will calculate all amounts estimated for the purposes of Sections 5.2, 5.3 and
5.4 including the actual cost incurred of providing to TMOL the services
eligible for reimbursement and royalties due TM Corp, and the parties shall,
within 30 days, true-up any differences between actual costs and allocations.
Royalties and expenses estimated for the purposes of Sections 5.2, 5.3 and 5.4
shall be estimated at no more than the actual amounts on a per ticket basis for
the prior quarter.

5.7 Audits. Each party shall deliver, along with its payments due
------
under this Article V, a report showing in reasonable detail the basis for such
payment. Each party shall keep and maintain complete and accurate records of
the transactions underlying the reports to be furnished hereunder, and shall
allow the other party's representative (a third party certified public
accountant), during office hours and at reasonable intervals, to inspect and
make extracts or copies of such records solely for the purpose of ascertaining
the correctness of such statements, at the expense of the party conducting such
inspection.

ARTICLE VI

SPONSORSHIPS AND ADVERTISING

6.1 Advertising. Subject to the terms of this Article VI, TM Corp
-----------
may arrange advertising for TMOL Web sites, to be sold in a bundle with other
advertising sold by TM Corp. TMOL shall provide TM Corp the opportunity to
solicit sales of advertising on terms no less favorable than those it provides
to other agencies soliciting advertising in similar quantity and quality. TMOL
shall accommodate any advertising agreements of TM Corp existing as of the
effective date of this Agreement that are listed on Exhibit E.

6.2 TM Corp Sponsors. As to credit card, shipping and handling,
----------------
technology and telephone sponsors at TM Corp, TM Corp shall use commercially
reasonable efforts to cause such sponsorship arrangements to include Online
advertising on ticketmaster.com. If such sponsorship arrangements include
advertising on ticketmaster.com, TM Corp shall pay to TMOL a reasonable
allocation of sponsorship revenue, consistent with previous methods of
allocation in Exhibit E but subject to changes in market conditions, after
deduction of a reasonable allocation of costs and rebates, if any, made to
Client Venues and any direct costs associated with the production of such
revenue. Exhibit E describes such allocation with respect to any sponsorship
agreements of TM Corp existing as of the effective

-10-
<PAGE>

date of this Agreement. TM Corp shall keep TMOL apprised of all actual or
anticipated sponsorships arranged or being sought by TM Corp.

ARTICLE VII

ONLINE RIGHTS AND VENUE AGREEMENTS

7.1 Online Distribution Rights. In the event any Ticketmaster
--------------------------
Company assigns, transfers, or otherwise encumbers any rights of a Ticketmaster
Company to generate Fees or permits the transfer of control of any Ticketmaster
Company (by merger, consolidation, sales of equity interests or assets, or any
other means) (a) the Ticketmaster Companies shall obtain from the assignee or
transferee for the benefit of TMOL terms no less favorable than those granted by
the Ticketmaster Companies to TMOL under this Agreement, or the Ticketmaster
Companies shall otherwise provide TMOL substantially equivalent economic
benefits on an ongoing basis and (b) the parties agree to negotiate in good
faith alternative arrangements to give full effect to TMOL's rights and
obligations hereunder.

7.2 Client Venue Agreements. TM Corp shall use reasonable best
-----------------------
efforts to ensure that, under each Client Venue Agreement entered into or
renewed after the effective date of the Agreement, TM Corp will maintain the
Online distribution rights in a manner that TMOL can enjoy the benefits of this
Agreement. TM Corp shall use reasonable best efforts to enter into or renew
Client Venue Agreements on or after the effective date of this Agreement on
terms (including with respect to charges constituting Fees) no less favorable to
TMOL than the terms pertaining to Ticket distribution conducted by telephone.
Notwithstanding the foregoing, TM Corp may in lieu of the requirements of this
provision provide TMOL the economic equivalent of the inclusion of such rights.

ARTICLE VIII

NON-COMPETITION

8.1 In consideration for the exclusive arrangements of this
Agreement, (a) TMOL shall not enter into any arrangements with any Venues, and
Ticket sales agents or sellers of Tickets other than Ticketmaster Companies to
provide Online promotion or sales of Tickets during the term of the Agreement;
and (b) USAi, on behalf of Ticketmaster Companies, agrees that, except to
perform their obligations under this Agreement, Ticketmaster Companies shall not
engage in, enter into any arrangements or cooperate with any third party for
Online Ticketing and Sales or Online Promotion of TM Tickets. Nothing in this
Agreement shall be construed to prevent the TMOL CitySearch Web sites from
incorporating links to a Web site owned or operated by a Venue (other than a
Client Venue, a Ticket sales agent or a reseller of Tickets) through which
Online promotion and sales of the Tickets of such Venue occur, provided that TM
Corp reasonably does not deem such Venue to be a material part of the potential
market for TM Corp's ticketing or other services to Venues in the locality of
such Venue.

-11-
<PAGE>

ARTICLE IX

REPRESENTATIONS AND WARRANTIES; INDEMNITIES

9.1 TM Corp Representations and Warranties. TM Corp hereby
--------------------------------------
represents and warrants that:

(i) TM Corp has the right to enter into this Agreement and to grant
the rights being granted under this Agreement and has granted no rights that
would prohibit or materially interfere with the rights granted or agreements
made under this Agreement; and

(ii) The Ticketmaster Companies hold a valid trademark registration in
the word mark "TICKETMASTER" for use in connection with the respective goods and
services in each of the countries listed in Exhibit D with status "Registered"
for such word mark; as to all other Trademarks, except to an extent that would
not have a material adverse effect on TMOL's rights under this Agreement, and
except in connection with Trademarks identified in Exhibit D with status other
than "Registered," the Ticketmaster Companies hold a valid trademark
registration in such Trademarks for use in connection with the respective goods
and services, in each case in the country listed in Exhibit D pertaining to such
Trademark.

9.2 Copyright and Trade Secret Indemnities. Each party will be
--------------------------------------
performing its obligations under this Agreement using certain technology in
connection with Online Ticketing and Sales and Online Promotion ("Technology").
Each party shall defend or settle any third party claim, proceeding or suit
("Claim") brought against the other party to the extent such Claim alleges
infringement of any copyright or trade secret in the Territory which
infringement arises from use of the Technology in connection with Online Ticket
distribution.

9.3 Indemnity. Each party shall indemnify and hold harmless the
---------
other party against any and all Claims, losses, liabilities, and expenses
arising out of any breach by such party of Article II or Article III of this
Agreement.

9.4 Limitations. Neither party will have any obligations for Claims
-----------
under this Article IX unless (a) the indemnified party notifies the indemnifying
party promptly in writing of the Claim, (b) the indemnified party gives the
indemnifying party sole control over the defense and settlement of such Claim,
and (c) the indemnified party gives the indemnifying party full information and
assistance to defend or settle such Claim. The foregoing states the entire
liability and obligations of each party, and the sole remedy of each party, with
respect to any alleged infringement of patents, copyrights, or trade secrets
with respect to the Technology.

-12-
<PAGE>

ARTICLE X

CONFIDENTIALITY

10.1 Confidentiality. Each party shall treat as confidential all
---------------
Confidential Information of the other party, shall not use such Confidential
Information except in connection with performing its obligations and exercising
its rights under this Agreement and shall not disclose such Confidential
Information to any third party. This Section 10.1 will not apply to any
Confidential Information which is or becomes generally known and available in
the public domain through no fault of the receiver.

ARTICLE XI

TERM AND TERMINATION

11.1 Term. This Agreement will commence on the Effective Time, as
----
such term is defined in the Reorganization Agreement and continue perpetually
unless and until terminated as set forth below.

11.2 No Injunctive Relief. Notwithstanding anything to the contrary
--------------------
herein, no breach of this Agreement will entitle any party to terminate or
rescind this Agreement, or entitle TM Corp or Ticketmaster Companies to
injunctive or other equitable relief to terminate the licenses in this
Agreement. However, TMOL may terminate the provisions of Sections 4.1 and 4.3
regarding fulfillment services in the event of a material breach by TM Corp of
Section 4.1 that is uncured after 60 days written notice thereof to TM Corp.

11.3 Effect of Termination. The rights and obligations of the parties
---------------------
under Article X will survive any termination of this Agreement.

ARTICLE XII

GENERAL PROVISIONS

12.1 Amendment. Subject to applicable law, this Agreement may be
---------
amended by the parties hereto at any time by execution of an instrument in
writing signed on behalf of each of each party; however, prior to an initial
public offering of TMOL, this Agreement may not be modified without the approval
of a majority of the City Directors (as defined in the Reorganization
Agreement).

12.2 Extension; Waiver. Any party hereto may, to the extent legally
-----------------
allowed, (i) extend the time for the performance of any of the obligations or
other acts of the other parties hereto, (ii) waive any inaccuracies in the
representations and warranties made to such party contained herein or in any
document delivered pursuant hereto and (iii) waive compliance with any of the
agreements or conditions for the benefit of such party contained herein. Any
agreement on the part of a party hereto to any such extension or waiver shall be
valid only if

-13-
<PAGE>

set forth in an instrument in writing signed on behalf of such party. Delay in
exercising any right under this Agreement will not constitute a waiver of such
right.

12.3 Notices. All notices and other communications hereunder must be
-------
in writing and shall be deemed given if delivered personally or by commercial
delivery service, or sent via facsimile (receipt confirmed) to the parties at
the following addresses or facsimile numbers (or at such other address or
facsimile numbers for a party as shall be specified by like notice):

(a) if to TMOL, to:

c/o CitySearch, Inc.
790 East Colorado Boulevard
Suite 200
Pasadena, CA 91101
Attention: Doug McPherson
Telephone No.: (626) 660-2510
Facsimile No.: (626) 405-9929

with a copy to:

Wilson Sonsini Goodrich & Rosati, P.C.
650 Page Mill Road
Palo Alto, California 94304
Attention: Larry W. Sonsini
John T. Sheridan
Marty Korman
Telephone No.: (650) 493-9300
Facsimile No.: (650) 493-6811

(b) if to TM Corp, or any Ticketmaster Company, to:

Ticketmaster Group, Inc.
8800 Sunset Boulevard
West Hollywood, CA 90069
Attention: General Counsel
Telephone No.: (310) 360-6000
Facsimile No.: (310) 360-6509

-14-
<PAGE>

USA Network, Inc.
152 West 57th Street
New York, NY 10019
Attention: General Counsel
Telephone No.: (212) 314-7322
Facsimile No.: (212) 314-7329

with a copy to:

Howard, Smith & Levin LLP
1330 Avenue of the Americas
New York, New York 10019
Attention: Scott F. Smith
Telephone No.: (212) 841-1000
Facsimile No.: (212) 841-1010

12.4 Counterparts. This Agreement may be executed in one or more
------------
counterparts, all of which shall be considered one and the same agreement and
shall become effective when one or more counterparts have been signed by each of
the parties and delivered to the other party, it being understood that all
parties need not sign the same counterpart.

12.5 Entire Agreement; Third Party Beneficiaries. This Agreement, its
-------------------------------------------
Exhibits, and the documents and instruments and other agreements among the
parties hereto as contemplated by or referred to herein, or such other documents
that may be entered into by the parties referring to this Agreement, constitute
the entire agreement among the parties with respect to the subject matter hereof
and supersede all prior agreements and understandings, both written and oral,
among the parties with respect to the subject matter hereof.

12.6 Severability. In the event that any provision of this Agreement
------------
or the application thereof becomes or is declared by a court of competent
jurisdiction to be illegal, void or unenforceable, the remainder of this
Agreement will continue in full force and effect and the application of such
provision to other persons or circumstances will be interpreted so as reasonably
to effect the intent of the parties hereto. The parties further agree to
replace such void or unenforceable provision of this Agreement with a valid and
enforceable provision that will achieve, to the extent possible, the economic,
business and other purposes of such void or unenforceable provision.

12.7 Governing Law. This Agreement shall be governed by and construed
-------------
in accordance with the laws of the State of California, regardless of the laws
that might otherwise govern under applicable principles of conflicts of law
thereof. Each of the parties hereto irrevocably consents to the jurisdiction of
any state or federal court within the Central District of California in
connection with any matter based upon or arising out of this Agreement or the
matters contemplated herein, agrees that process may be served upon them in any
manner authorized by the laws of the State of California for such persons and
waives and covenants not to assert or plead any objection which they might
otherwise have to such jurisdiction and such process.

-15-
<PAGE>

12.8 Rules of Construction. The parties hereto agree that they have
---------------------
been represented by counsel during the negotiation and execution of this
Agreement and, therefore, waive the application of any law, regulation, holding
or rule of construction providing that ambiguities in an agreement or other
document will be construed against the party drafting such agreement or
document.

12.9 Assignment. No party may assign either this Agreement or any of
----------
its rights, interests, or obligations hereunder without the prior written
approval of the other parties. Notwithstanding the above, (a) TM Corp may
assign all of its rights and obligations under this Agreement to any entity that
is a controlled subsidiary of TM Corp, provided such party agrees in writing to
be bound to the terms of this Agreement; and (b) TMOL may assign all of its
rights and obligations under this Agreement to any entity that acquires control
of TMOL by means of a sale or merger of TMOL or a sale of all or substantially
all of TMOL's assets, provided such entity agrees in writing to be bound to the
terms of this Agreement. Subject to the preceding sentence, this Agreement
shall be binding upon and shall inure to the benefit of the parties hereto and
their respective successors and permitted assigns.

12.10 Effectiveness. This Agreement shall become effective upon the
-------------
consummation of the Merger contemplated by the Reorganization Agreement. Prior
to that time, this Agreement shall have no force and effect. In the event the
Reorganization Agreement terminates, this Agreement shall be null and void, and
of no further force and effect.

12.11 USAi Undertaking. USAi and TM Corp shall cause Ticketmaster
----------------
Companies to comply with all obligations of this Agreement.

* * * *

-16-
<PAGE>

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed by their duly authorized respective officers as of the date first
written above.

TICKETMASTER MULTIMEDIA HOLDINGS, INC.

By: /s/ Eugene L. Cobuzzi
--------------------------------------

Name: Eugene L. Cobuzzi
------------------------------------

Title: E.V.P.
-----------------------------------

TICKETMASTER CORPORATION

By: /s/ Eugene L. Cobuzzi
--------------------------------------

Name: Eugene L. Cobuzzi
------------------------------------

Title: C.O.O.
-----------------------------------

USA NETWORKS, INC.

By: /s/ Thomas J. Kuhn
--------------------------------------

Name: Thomas J. Kuhn
------------------------------------

Senior Vice President and General
Title: Counsel
-----------------------------------

ACKNOWLEDGED AND AGREED:

CITYSEARCH, INC.

By: /s/ Thomas H. Layton
------------------------

Name: Thomas H. Layton
----------------------

Title: President
---------------------

* * * LICENSE AND SERVICES AGREEMENT * * *
<PAGE>

EXHIBIT A - SERVICES

TM Corp will provide the following services, providing the same level of service
generally as currently provided (subject to appropriate adjustments for changes
in market conditions):

. all order processing, payment processing, and fulfillment services for TM
Merchandise and TM Tickets following Online Ticketing and Sale, including
shipping and handling

. consumer service inquiries

. merchandising services for entertainment-related TM Merchandise (Concert,
Sports, Theater, Family and Fine Arts) that TMOL sells

. collection of all proceeds of TM Ticket sales and remittance by TM Corp to
Client Venues

. collection of all Fees and remittance by TM Corp to TMOL of such amounts as
are due pursuant to this Agreement

. collection and remittance of merchandising revenue for TM Merchandise
access to TM Data necessary to engage in Online Ticketing and Sale and
Online Promotion, meeting at least the following performance standards:

. 7 days per week, approximately, 7:00am to 11:00pm, for each U.S. time
zone, real time access

. responses to requests made to the TM Corp gateway will be consistent
with current practices or TM Corp shall use its commercially
reasonable efforts to minimize the response time for requests made to
the TM Corp gateway

. volume handling sufficient to process 3,500,000 Ticket sales in year
ended 1998; 7,200,000 Ticket sales in year ended December 31, 1999;
11,100,000 Ticket sales in year ended December 31, 2000; and
15,300,000 Ticket sales in year ended December 31, 2001

. data base services (data mining, data warehousing)
<PAGE>

EXHIBIT B - EXPENSE GUIDELINES

The following are comprehensive, and by way of limitation, not example:

. fulfillment cost, including shipping and handling

. direct costs associated with sales of TM Merchandise

. call center costs for consumer service inquiries shall be reasonably
allocated but not to exceed [*] per ticket

. third-party royalties (to the extent owed by Ticketmaster Companies) under
the Agreements set forth on Exhibit H

. secondary commissions to Client Venues

. credit card processing expenses

. credit card charge-backs

The costs outlined above that involve allocated costs (such as fulfillment
costs, call center costs and customer service costs) will be charged on a basis
no less favorable to TMOL than similar charges by TM Corp to other third parties
(taking into account any cost savings associated with Online Ticket distribution
as compared to other Ticket distribution). TMOL will have rights to review the
calculation of such costs.

TM Corp will use commercially reasonable efforts to charge TMOL's consumers the
same shipping charge and handling fees charged to TM Corp's telephone customers.
Such fees will be based on an actual or average cost per order.

[*] = CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH
RESPECT TO THE OMITTED PORTIONS.
<PAGE>

EXHIBIT C - TRADEMARK USE GUIDELINES

1. These trademark usage guidelines apply to the authorized use of all of the
Trademarks in connection with the Online Ticketing and Sale and Online
Promotion of TM Tickets and TM Merchandise, whether in advertisements,
labels, product guides, catalogs, brochures, instruction manuals, customer
communications, press releases, packaging, electronic communications and
all other uses of the Trademarks.

2. The following general rules apply:

. Spell the trademark correctly and do not abbreviate it.

. Use capitalization consistently.

. Use a standard appearance for the trademark.

. Use a proper trademark notice at least once, the first time the Trademark
appears: we prefer you to use the notice each time the trademark is used.
Use (R) for registered trademarks and service marks, "TM" for unregistered
trademarks, and "SM" for unregistered service marks. If you have any
questions about which marks are registered, ask us.

. Use the Trademark only as a brand name in conjunction with a specific
product or service, e.g., Productname Tickets. "Productname " alone is not
appropriate. Use the trademark only as an adjective modifying a generic
product ("the Productname Tickets"), and never as a noun or a verb ("the
Productname ").

. Always give Ticketmaster Corporation attribution as the trademark owner any
time the Trademarks are used, e.g., " Productname is a trademark or
registered trademark of Ticketmaster Corporation".

3. TM Corp shall from time to time supply reasonable guidelines regarding
appearance of its logos in permitted uses, such as color, appearance, size,
clear space and fonts.

4. Restrictions:

Do not use the Trademarks in connection with any erotic or adult content,
content of an overtly sexual nature, or content containing profanity or
obscenity.
<PAGE>

EXHIBIT D - TRADEMARKS

[*]

[*] = THE INFORMATION ON PAGES 1 THROUGH 73 OF THIS EXHIBIT HAS BEEN OMITTED
AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.

<PAGE>

EXHIBIT E

EXISTING ADVERTISING AGREEMENTS

<TABLE>
<CAPTION>
CALENDAR 1998 CALENDAR 1999
ALLOCATION TO ALLOCATION TO
ADVERTISER DATE OF AGREEMENT EXPIRATION DATE ONLINE ONLINE
- ------------------- ----------------- ------------------ ------------- --------------
<S> <C> <C> <C> <C>
Acura June 1, 1998 September 30, 1998 [*] --
Amtrak June 16, 1998 September 23, 1998 [*] --
BASEketball June 17, 1998 July 31, 1998 [*] --
Bell South March 19, 1998 May 12, 1998 [*] --
Bell South December 30, 1997 March 31, 1998 [*] --
CD Now December 29, 1997 January 31, 1998 [*] --
CD Now January 28, 1998 February 28, 1998 [*] --
City Search April 18, 1997 June 30, 1998 [*] --
Columbia Tri-Star December 19, 1997 February 6, 1998 [*] --
Columbia Tri-Star March 19, 1998 April 24, 1998 [*] --
Columbia Tri-Star May 29, 1998 July 17, 1998 [*] --
Columbia Tri-Star August 7, 1998 August 21, 1998 [*] --
ESPN Sportszone June 1, 1998 December 31, 1998 [*]* --
eToys June 1, 1998 June 23, 1998 [*] --
Excite June 3, 1997 June 30, 1998 -- --
Ford Motor Media December 17, 1997 January 31, 1998 [*] --
Ford Motor Media January 30, 1998 April 30, 1998 [*] --
Ford Motor Media March 26, 1998 June 30, 1998 [*] --
Ford Motor Media July 1, 1998 September 30, 1998 [*] --
Gap, The November 12, 1997 May 15, 1998 [*] --
Gibson Guitars March 9, 1998 March 24, 1998 [*] --
Infoseek August 3, 1998 August 16, 1998 [*] --
Intel July 2, 1998 July 15, 1998 [*] --
Internet Shopping Network May 12, 1998 May 31, 1998 [*] --
Jam TV June 8, 1997 June 30, 1999 -- --
Kenwood August 3, 1998 October 31, 1998 [*] --
Lexus April 1, 1998 May 10, 1998 [*] --
Lexus April 1, 1998 May 31, 1998 [*] --
Los Angeles Times September 11, 1997 August 31, 1998 -- --
Mastercard October 23, 1995 November 30, 2000 [*]**
Microsoft June 9, 1998 September 23, 1998 [*] --
Music Boulevard January 14, 1998 February 15, 1998 [*] --
Music Boulevard February 11, 1998 March 16, 1998 [*] --
N2K April 23, 1998 April 30, 2000 [*] [*]
Nabisco June 16, 1998 August 16, 1998 [*] --
Nestle (Stouffers) October 23, 1997 May 31, 1998 [*] --
NY Times November 4, 1997 One year from availability -- --
Pillsbury December 11, 1997 February 28, 1998 [*] --
Red Lobster July 27, 1998 August 10, 1998 [*] --
Sonicnet February 13, 1998 March 31, 1998 [*] --
Sprint September 19, 1996 August 31, 2001 [*] pending
Sprint (May Movie Promo) May 4, 1998 June 7, 1998 [*] --
</TABLE>

- ------------
[*] = CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
<PAGE>

* Potential to earn $[*] based upon amount of click thrus.
** Represents [*]% of the monthly pro rata revenue from the annual
MasterCard Sponsorship Agreement, net of costs to venues. The amount
reflected in this schedule represents allocations from August 1998 (the
projected start of the merged entity) through October 1998 (the end of
the existing MasterCard Agreement), (i.e., $[*] - $[*] = $[*] / [*] =
$[*] / [*] * [*] = [*]).

- --------------
[*] = CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
<PAGE>

23. Joint Development Agreement between Ticket New Ventures, Ltd. and CIE
Internatcional, S.A. de C.V. dated June 27, 1997

24. Joint Venture Agreement between Ticketmaster Australasia Holdings Inc. and
Victorian Arts Centre Trust dated June 16, 1995.

25. Shareholders Agreement among CANAL+ SA, Ticketmaster Ticketing Co., Inc.,
in the name and on behalf of Ticketmaster France Holdings, Co., and
Ticketmaster Ticketing Co., Inc., dated April 30, 1998.

26. Joint Venture Agreement between Ticketmaster Bass Australasia Holdings Pty
Ltd. and Ticketmaster Australasia Investments Pty Ltd. dated December 1,
1995
<PAGE>

EXHIBIT H

CONTRACTS PROVIDING FOR FEE SHARING

1. Content Manager Agreement between Ticket Corp. and Intel Corporation dated
February 12, 1998

2. Development and Services Agreement with Starwave Corporation dated June 28,
1996

3. Cross-promotional, marketing, advertising and retail agreement with N2K
Inc. dated April 23, 1998

4. Content License, Promotion and Link Agreement with Yahoo!, Inc. dated June
1, 1998

5. Cross-promotional agreement with Knight Ridder New Media dated October 15,
1997

6. Cross-promotional agreement with Tribune Interactive, Inc. dated November
18, 1997

7. Cross-promotional agreement with The New York Times Electronic Media
Company dated November 4, 1997

8. Joint promotional agreement with The Los Angeles Times, a division of The
Times Mirror Company dated September 11, 1997

9. Cross-promotional agreement with JAM TV Corp. dated June 6, 1997

10. Distribution Agreement with Universal Studios Online, Inc. dated December
17, 1997

11. Cross-promotional agreement with DR Partners d/b/a Las Vegas Review Journal
dated March 6, 1998

<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 20,
1998.

/s/ Ernst & Young LLP

Los Angeles, California

November 20, 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 20, 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 20, 1998