GETTY IMAGES INC, S-3, 1999-09-29

GETTY IMAGES INC
S-3, 1999-09-29
BUSINESS SERVICES, NEC

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<PAGE> 1

AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON SEPTEMBER 29, 1999.

REGISTRATION NO. 333-
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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GETTY IMAGES, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
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<TABLE>
<S> <C> <C>
DELAWARE 7389 98-0177556
(STATE OR OTHER JURISDICTION OF (PRIMARY STANDARD INDUSTRIAL (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) CLASSIFICATION CODE NUMBER) IDENTIFICATION NO.)
</TABLE>

2101 FOURTH AVENUE, FIFTH FLOOR
SEATTLE, WASHINGTON 98121
(206) 695-3400
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING
AREA CODE, OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
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SUZANNE L. PAGE, ESQ.
GENERAL COUNSEL
GETTY IMAGES, INC.
2101 FOURTH AVENUE, FIFTH FLOOR
SEATTLE, WASHINGTON 98121
(206) 695-3400
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE,
OF AGENT FOR SERVICE)
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COPIES TO:

<TABLE>
<S> <C>
RICHARD S. MILLARD, ESQ. CHRISTOPHER L. KAUFMAN, ESQ.
WEIL, GOTSHAL & MANGES LLP LATHAM & WATKINS
2882 SAND HILL ROAD, SUITE 280 135 COMMONWEALTH DRIVE
MENLO PARK, CALIFORNIA 94025 MENLO PARK, CALIFORNIA 94025
(650) 926-6200 (650) 328-4600
</TABLE>

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

If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [ ]

If any of the 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, other than securities offered only in connection with dividend or interest
reinvestment plans, 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. [ ]
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CALCULATION OF REGISTRATION FEE

<TABLE>
<S> <C> <C> <C> <C>
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PROPOSED PROPOSED
TITLE OF EACH AMOUNT MAXIMUM MAXIMUM
CLASS OF SECURITIES TO BE OFFERING PRICE AGGREGATE OFFERING AMOUNT OF
TO BE REGISTERED REGISTERED(1) PER SHARE(2) PRICE(2) REGISTRATION FEE
- ---------------------------------------------------------------------------------------------------------------------------------
Common stock, $.01 par value, of
Getty Images, Inc............... 5,750,000 shares $24.125 $138,718,750 $38,564
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</TABLE>

(1) Includes 750,000 shares being registered to cover over-allotments, if any.

(2) Estimated in accordance with Rule 457(c), solely for the purpose of
determining the registration fee, on the basis of the average of the high
and low sales price of shares of common stock of Getty Images, Inc. on
September 27, 1999.
------------------------

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 OF THE
SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8, MAY
DETERMINE.

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<PAGE> 2

THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. WE MAY
NOT SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER
TO SELL THESE SECURITIES AND WE ARE NOT SOLICITING OFFERS TO BUY THESE
SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.

PROSPECTUS (Subject to Completion)

Issued , 1999

5,000,000 Shares

[GETTY IMAGES LOGO]
COMMON STOCK

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GETTY IMAGES, INC. IS OFFERING 5,000,000 SHARES OF ITS COMMON STOCK.
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OUR COMMON STOCK IS LISTED ON THE NASDAQ NATIONAL MARKET UNDER THE SYMBOL
"GETY." ON , 1999, THE REPORTED LAST SALE PRICE OF OUR
COMMON STOCK WAS $ PER SHARE.
------------------------

INVESTING IN OUR COMMON STOCK INVOLVES RISKS. SEE "RISK FACTORS" BEGINNING ON
PAGE 7.
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PRICE $ A SHARE
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<TABLE>
<CAPTION>
UNDERWRITING
PRICE TO DISCOUNTS AND PROCEEDS TO
PUBLIC COMMISSIONS GETTY IMAGES
--------- ------------- ------------
<S> <C> <C> <C>
Per Share........................................... $ $ $
Total............................................... $ $ $
</TABLE>

------------------------
Getty Images has granted the underwriters the right to purchase up to an
additional 750,000 shares to cover over-allotments.

The Securities and Exchange Commission and state securities regulators have not
approved or disapproved these securities, or determined if this prospectus is
truthful or complete. Any representation to the contrary is a criminal offense.

Morgan Stanley & Co. Incorporated expects to deliver the shares of common stock
to purchasers on , 1999.
MORGAN STANLEY DEAN WITTER
BANCBOSTON ROBERTSON STEPHENS
DEUTSCHE BANC ALEX. BROWN
HAMBRECHT & QUIST
PACIFIC CREST SECURITIES
, 1999

EDGAR description of artwork:
Inside front cover graphics of prospectus --
Inside back cover of prospectus --
Outside back cover of prospectus --
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EDGAR description of artwork:
Inside front cover graphics of prospectus --
Inside back cover of prospectus --
Outside back cover of prospectus --

TABLE OF CONTENTS

<TABLE>
<CAPTION>
PAGE
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<S> <C>
Prospectus Summary.................... 3
Risk Factors.......................... 7
Special Note Regarding
Forward-Looking Statements.......... 18
The Transaction....................... 19
Use of Proceeds....................... 23
Capitalization........................ 24
Common Stock Price Range.............. 25
Dividend Policy....................... 25
Selected Consolidated Financial Data
of Getty Images..................... 26
Management's Discussion and
Analysis of Financial Condition
and Results of Operations of Getty
Images.............................. 28
Selected Consolidated Financial Data
of The Image Bank................... 42
</TABLE>

<TABLE>
<CAPTION>
PAGE
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<S> <C>
Management's Discussion and Analysis
of Financial Condition and Results
of Operations of The Image Bank..... 43
Unaudited Condensed Pro Forma
Consolidated Financial
Information......................... 46
Business.............................. 54
Management............................ 67
Underwriters.......................... 70
Legal Matters......................... 71
Experts............................... 72
Where You Can Find More Information... 72
Incorporation of Certain
Documents by Reference.............. 73
Index to Consolidated Financial
Statements.......................... F-1
</TABLE>

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Our principal executive offices are located at 2101 Fourth Avenue, Fifth
Floor, Seattle, Washington 98121, and our telephone number is (206) 695-3400.
Our website can be found at www.getty-images.com. The contents of our website
are not part of this prospectus.

In this prospectus, "Getty Images," "we," "us," and "our" refer to Getty
Images, Inc. and its consolidated subsidiaries, unless the context otherwise
dictates, and references to "dollars" or "$" are to United States dollars and
references to "pounds sterling" or "L" are to United Kingdom pounds sterling.
Getty Images, Getty, Getty Logo, gettyone, Energy Film Library, PhotoDisc,
Allsport, OnLine USA, Tony Stone Images, EyeWire, Hulton, Art.com and Liaison
are used in this prospectus and are our trademarks. We also refer to trademarks
of others in this prospectus.

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

You should rely only on the information contained in this prospectus or
incorporated herein by reference. Any statement contained in a document
incorporated or deemed to be incorporated by reference into this prospectus
shall be deemed to be modified or superseded for purposes of this prospectus to
the extent that a statement contained in this prospectus, or in any other
document filed subsequently with the Securities and Exchange Commission which
also is or is deemed to be incorporated by reference, modifies or replaces that
statement. Any such statement so modified or replaced shall not be deemed,
except as so modified or replaced, to constitute part of this prospectus.

We have not authorized anyone to provide you with information different
from that contained in this prospectus or incorporated herein by reference. We
are offering to sell shares of common stock and seeking offers to buy shares of
common stock only in jurisdictions where offers and sales are permitted. The
information contained in this prospectus or incorporated herein by reference is
accurate only as of its date, regardless of the time of the delivery of this
prospectus or of any sale of the common stock.

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

UNTIL , 1999, ALL DEALERS THAT BUY, SELL OR TRADE
SHARES OF COMMON STOCK, WHETHER OR NOT PARTICIPATING IN THIS OFFERING, MAY BE
REQUIRED TO DELIVER A PROSPECTUS. THIS IS IN ADDITION TO THE DEALERS' OBLIGATION
TO DELIVER A PROSPECTUS WHEN ACTING AS UNDERWRITERS AND WITH RESPECT TO THEIR
UNSOLD ALLOTMENTS OR SUBSCRIPTIONS.
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PROSPECTUS SUMMARY

You should read the following summary together with the more detailed
information about our company, the common stock being sold and our financial
statements and the notes to those statements included elsewhere in this
prospectus. In addition, you should carefully consider the information set forth
or referred to under the heading "Risk Factors."

GETTY IMAGES

We are a leading provider of imagery to businesses and consumers worldwide,
distributing products digitally via the Internet and on CD ROMs, as well as in
analog form. We are pioneering a solution to aggregate and distribute visual
content. Since 1995, we have been an active consolidator of many of the visual
content industry's leading brands, acquiring brands such as Tony Stone Images, a
leading worldwide provider of contemporary stock photography, PhotoDisc, a
pioneer in the development and marketing of digital stock photography, which
uses the royalty-free licensing model, and the electronic delivery of images,
Allsport, a leading worldwide sports photography provider, EyeWire, a leading
provider of royalty-free imagery and visual content-related products and
services to the business user market, and Art.com, a leading provider of framed
and unframed art and art-related products to consumers on the Internet. We work
with an estimated 2,800 photographers and an estimated 400 cinematographers and
film producers to create our content. We recorded sales of $185.1 million in
1998, and $107.1 million for the six months ended June 30, 1999. Following our
recently announced acquisition of The Image Bank, which had sales of $70.8
million in 1998, we will own an estimated 60 million still images and an
estimated 27,000 hours of film footage.

We provide our high quality, relevant imagery to creative professionals at
advertising agencies, graphic design firms and corporations; press and editorial
customers involved in newspaper, magazine, book, CD ROM and online publishing;
business users and small office/home office users; and consumers. By aggregating
the content of our various leading brands on the Internet and partnering with
third party providers, we offer a comprehensive and user friendly solution for
our customers' imagery and related product needs. We seek to leverage our
internally-developed search and e-commerce technology to enhance our position as
a leader in the visual content industry.

Visual content is everywhere and is used by businesses and consumers alike
to enlighten, inspire, entertain, and communicate messages. Imagery is a dynamic
and forceful communication tool, allowing users to capture thoughts or ideas in
a simple way. Imagery has no language barriers and can often convey universal
messages. Business users typically integrate imagery into various media, such as
advertisements, billboards, direct mail, magazines, newspapers, packaging,
motion pictures, television programming and commercials and websites. Consumers,
forming a distinct market segment, have traditionally purchased images for
decoration or pleasure in the home or office and are increasingly using images
on the Internet.

The visual content industry supplies imagery to a varied and growing
customer base. The industry has historically been highly fragmented, with a few
international providers, a number of regional providers and a large number of
small businesses that specialize in a particular content type or geographic
area. We believe that the demand for visual content has grown throughout the
twentieth century. We believe this growth can be attributed in part to
technological improvements which have made imagery more accessible and the
proliferation of both print and television media. Recently, industry growth has
been accelerated by the use of still images and film footage on the Internet.

The visual content industry involves the creation, acquisition, storage,
distribution and end-use of both still images and film footage. Traditionally,
images have been captured and distributed
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in analog form. This has required a lengthy process for the provider and has
also been relatively inefficient for the customer. Digital image technology
captures images in a form that can be stored, electronically manipulated and
quickly retrieved from a computer. While visual content providers continue to
create and distribute imagery in the analog format, they are increasingly using
digital technology. The migration toward digital technology has had implications
for improving the process both from a customer and content provider perspective.
For the customer, the digital image acquisition process is dramatically more
efficient. For providers, digitization provides an opportunity to achieve
economies of scale by consolidating a widely fragmented industry, thereby
leveraging an increased offering of images over a wide range of business and
consumer customers.

We offer a hassle-free comprehensive solution, high quality, relevant
content and around-the-clock service to our customers. We seek to be the leading
provider in the visual content industry. Key elements of our strategy include:
promoting online distribution; creating vertical portals for our key customer
segments; increasing our penetration of the consumer marketplace; maintaining
our technology expertise; leveraging strategic alliances; and continuing to
pursue acquisitions.

RECENT DEVELOPMENTS

THE IMAGE BANK

The Image Bank employs approximately 475 people in ten offices throughout
the world, including offices in the United States, France and Hong Kong. The
Image Bank has also established an extensive network of franchised offices in
North America, Europe, Asia Pacific, South America and Africa. This network
enables The Image Bank to provide access to images worldwide, as well as
localized service and image distribution to creative professionals in major
global media markets.

EYEWIRE PARTNERS, INC. AND ONLINE USA, INC.

On August 5, 1999, we completed the acquisition of EyeWire Partners, Inc.,
a leading provider of royalty-free photography, video, audio, typefaces,
software and other design resources to creative professionals and business
users. EyeWire does the majority of its business online. We believe the
acquisition of EyeWire, located at www.eyewire.com, supports our strategy of
migrating the visual content industry from an analog to a digital platform, by
providing us with an array of online services. On August 19, 1999, we completed
the acquisition of Online USA, Inc., located at www.onlineusa.com, an agency
specializing in the sourcing and distribution of celebrity imagery over the
Internet.

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THE OFFERING

Common stock offered............ 5,000,000 shares

Common stock to be outstanding
after the offering.............. 40,434,676 shares

Use of proceeds................. To finance the acquisition of The Image Bank
and for general corporate purposes,
including working capital.
See "Use of Proceeds."

Nasdaq National Market Symbol... GETY

The above information is based on 35,434,676 shares of common stock
outstanding as of August 5, 1999. This information does not include 8,780,922
shares of common stock issuable upon exercise of our stock options outstanding
on August 5, 1999 or allocated for grant as of August 5, 1999. See
"Capitalization."

Unless otherwise specifically stated, the information in this prospectus:

- assumes no exercise of the underwriters' over-allotment option; and

- assumes our outstanding convertible subordinated notes are not converted
into shares of our common stock.

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SUMMARY CONSOLIDATED AND PRO FORMA FINANCIAL DATA
(IN THOUSANDS, EXCEPT PER SHARE DATA)

<TABLE>
<CAPTION>
GETTY COMMUNICATIONS
PLC
(PREDECESSOR PRO FORMA CONSOLIDATED
COMPANY) GETTY IMAGES, INC. GETTY IMAGES, INC.
--------------------- ---------------------------------------------- -----------------------------
YEAR ENDED YEAR ENDED SIX MONTHS SIX MONTHS YEAR ENDED SIX MONTHS
DECEMBER 31, DECEMBER 31, ENDED JUNE 30, ENDED JUNE 30, DECEMBER 31, ENDED JUNE 30,
1996 1997 1998(1) 1998 1999 1998(2) 1999(2)
--------- --------- ------------ -------------- -------------- ------------ --------------
(UNAUDITED) (UNAUDITED) (UNAUDITED)
<S> <C> <C> <C> <C> <C> <C> <C>
STATEMENT OF OPERATIONS
DATA:
Sales................... $ 85,014 $100,797 $185,084 $ 86,057 $107,107 $ 256,300 $145,740
Gross profit............ 52,858 63,283 132,254 60,541 78,502 173,561 101,336
Operating
income/(loss)......... 7,967 7,880 (29,763) (17,529) (19,376) (92,236) (46,576)
Net income/(loss)....... 2,728 4,022 (36,383) (20,106) (23,688) (103,274) (53,199)
Net income/(loss) per
share................. $ .10 $ .11 $ (1.25) $ (.72) $ (.74)
Shares used in computing
per share amount...... 27,442 37,908 29,160 27,787 32,134
OTHER OPERATING DATA:
EBITDA(3)............... $ 15,608 $ 19,347 $ 35,350 $ 14,956 $ 17,706 $ 37,562 $ 16,723
EBITDA per share........ $ .57 $ .51 $ 1.21 $ .54 $ .55
BALANCE SHEET DATA:
Cash and cash
equivalents........... $ 58,939 $ 29,234 $ 16,150 $ 36,163 $ 14,394 $ 2,577
Working capital(4)...... 51,242 23,062 22,627 31,568 16,562 14,138
Total assets............ 163,504 171,638 462,863 491,646 581,597 779,630
Long-term debt, net of
current maturities.... 17,910 14,657 72,354 72,014 72,778 123,182
Total stockholders'
equity................ 113,523 119,539 343,927 363,236 438,348 564,033
</TABLE>

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(1) Reflects the combination of the consolidated statement of operations of
Getty Communications plc, our predecessor company, for the period January 1,
1998 through February 9, 1998 and our consolidated statement of operations
for the period February 10, 1998 through December 31, 1998.

(2) Adjusted to reflect the pro forma adjustments (as set out in "Unaudited
Condensed Pro Forma Consolidated Financial Information") that would have
been determined if the acquisitions of Art.com and The Image Bank had taken
place on January 1, 1998. The unaudited selected pro forma consolidated
financial data is provided for illustrative purposes only and does not
purport to represent what our actual results of operations and financial
position would have been had the acquisitions occurred on January 1, 1998,
nor is it necessarily indicative of our future operating results or
consolidated financial position.

(3) EBITDA is defined as earnings before interest, taxes, exchange
gains/(losses), amortization, depreciation, non-recurring integration and
restructuring costs, legal settlement and extraordinary items. Thus, EBITDA
with respect to us comprises sales less cost of sales and selling, general
and administrative expenses. We believe that EBITDA provides investors and
analysts with a measure of operating income unaffected by the financing and
accounting effects of acquisitions and assists in explaining trends in our
operating performance. EBITDA should not be considered as an alternative to
operating income as an indicator of our operating performance or to cash
flows as a measure of our liquidity. EBITDA may not be comparable to other
similarly titled measures used by other companies.

(4) Working capital is defined as total current assets less total current
liabilities.

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RISK FACTORS

You should carefully consider the risks described below, together with all
of the other information included in this prospectus, before making an
investment decision. The risks and uncertainties described below are not the
only ones we face. If any of the following risks actually occurs, our business,
financial condition and results of operations could be materially adversely
affected. In such case, the trading price of our common stock could decline, and
you might lose all or part of your investment.

RISKS RELATED TO OUR BUSINESS

IF WE FAIL TO COMPLETE THE PROPOSED ACQUISITION OF THE IMAGE BANK, WE WILL
NOT RECOGNIZE SOME OF THE BENEFITS WE DESCRIBE IN THIS PROSPECTUS.

While we have entered into a stock purchase agreement with Eastman Kodak
Company and Kodak S.A. to purchase all of the capital stock of The Image Bank,
Inc. and The Image Bank France S.A., we have not completed this transaction. The
stock purchase agreement contains a number of conditions that must be satisfied
before we can close the transaction. While we anticipate closing this
transaction in the fourth quarter of 1999, we cannot guarantee when, or whether,
this transaction will be completed. See "The Transaction."

IF WE FAIL TO EXECUTE OUR STRATEGY FOR THE IMAGE BANK FOLLOWING THE
ACQUISITION, OUR BUSINESS MAY BE ADVERSELY AFFECTED.

The acquisition of The Image Bank represents a significant expansion of our
operations and presents a number of risks, including:

Failure to Move the Core Contemporary Stock Photography Collection of The
Image Bank Online. The acquisition of The Image Bank will add a substantial
amount of new content to our visual content collections. Nearly all of The Image
Bank's content is in the traditional analog format. Following the acquisition,
we plan to convert The Image Bank's core contemporary stock photography
collection into digital format and make this collection available online. If we
are unable to complete this conversion process in an efficient and effective
manner, or encounter unexpected difficulties during this conversion, we will not
realize one of the contemplated benefits of the acquisition.

Loss of Customers and Photographers. The Image Bank's customers, and
photographers who supply its images, may not be willing to continue or expand
their existing relationships with The Image Bank following the acquisition.
While some customers and photographers have contractual obligations to The Image
Bank, we could lose a substantial number of customers or photographers to
competing providers.

Relations with Franchisees. The Image Bank conducts a significant portion
of its business through franchisees. We cannot guarantee that we will be able to
work effectively with The Image Bank franchisees following the acquisition. In
the event these franchisee relationships are strained or a dispute arises, we
may not be able to terminate or buy-out the franchise agreements on acceptable
terms.

Inability to Retain Employees. The Image Bank employees may not wish to
continue working for The Image Bank following the acquisition. The loss of key
employees may disrupt our business and give rise to additional recruiting and
training costs.

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IF WE ARE UNABLE TO INTEGRATE COMPANIES WE ACQUIRE SUCCESSFULLY, INCLUDING
THE IMAGE BANK, OUR BUSINESS WILL BE ADVERSELY AFFECTED.

As a result of the consolidation strategy that we have implemented since
our inception in 1995 and our current plans to acquire The Image Bank, our
management has focused significant attention on integrating acquired businesses.
Our future performance will largely depend on our ability to integrate the
operations of acquired companies, including The Image Bank. These acquisitions
create risks such as:

- disruption of our ongoing business;

- difficulty assimilating the operations, including financial and
accounting functions, sales and marketing procedures, technology and
other corporate administrative functions of the combined companies;

- diversion of attention of our senior management team from existing
operations and other potential business opportunities;

- problems combining personnel of the acquired companies with our existing
personnel; and

- problems retaining key employees from the acquired companies.

We cannot guarantee that we will successfully integrate The Image Bank or
any other acquired companies with our business.

FAILURE TO MANAGE OUR GROWTH MAY ADVERSELY AFFECT OUR BUSINESS.

We have experienced and are currently experiencing significant growth. This
growth has placed, and the future growth we anticipate in our operations will
continue to place, a significant strain on our resources. As part of this
growth, we will have to implement new operational systems and procedures and
controls, expand, train and manage our employee base, and maintain close
coordination among our technical, accounting, finance, marketing, sales and
editorial staffs. In addition, managing these aspects of our business must be
done in the context of geographically dispersed operations worldwide.

Several members of our senior management team joined us in 1999. These
individuals are currently becoming integrated with the other members of our
management team. We believe the successful integration of our management team is
critical to manage our operations effectively and support our growth.

WE MAY LOSE CUSTOMERS IF WE ARE UNABLE TO DETERMINE CURRENT OR FUTURE TRENDS
AND MAINTAIN UP-TO-DATE CONTENT IN OUR COLLECTIONS.

Our future performance depends on our ability to review and refresh our
collections based on current and future trends in order to provide our customers
with the most up-to-date content. If we are unable to determine such trends and
add new imagery, or fail to do so in a timely manner, customers requiring such
content may use another visual content provider to obtain imagery.

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ACQUISITION RELATED CHARGES AND RESTRUCTURING COSTS COULD HAVE AN ADVERSE
IMPACT ON OUR OPERATING RESULTS.

Our operating results and earnings in future periods may be adversely
affected as a result of acquisition-related charges, including:

- significant goodwill amortization charges;

- one-time transaction costs; and

- other related one-time reorganization charges.

For example, the acquisitions of PhotoDisc and Allsport in February 1998,
Art.com in May 1999 and EyeWire in August 1999 generated approximately $396.1
million of goodwill and $51.0 million of other intangibles that will result in a
substantial annual charge to be amortized against our earnings in future
periods. We are amortizing goodwill relating to PhotoDisc and Allsport over 20
years, goodwill relating to Art.com over three years and goodwill relating to
EyeWire over seven years. We amortize other intangibles over one to three years.
However, we could be required to write-down the unamortized value of such
goodwill in the future at an accelerated rate in the event that it suffers an
impairment in value. Any acquisition we consummate in the future could generate
goodwill and other intangibles that would result in similar charges to be
amortized against our future earnings.

We incurred non-recurring integration and restructuring costs of $13.8
million during 1998 following the acquisitions of PhotoDisc and Allsport. In
addition, we expect to incur additional non-recurring charges associated with
the elimination of redundant positions and costs associated with the potential
closure or consolidation of facilities in the remainder of 1999. We currently
believe these charges will not exceed $10.0 million. We cannot guarantee that
further integration of our existing and future businesses will not result in
similar or greater integration and restructuring costs, which will negatively
effect our future earnings.

WE EXPECT OUR QUARTERLY FINANCIAL RESULTS TO FLUCTUATE.

Historical trends and quarter-to-quarter comparisons of our operating
results are not good indicators of our future performance. It is possible that
some future quarterly results may be below the expectations of public market
analysts and investors. In this event, the price of our common stock may fall.
Our revenues and operating results are expected to vary from quarter-to-quarter
due to a number of factors, including:

- demand for our products;

- our ability to continue to move customers to the digital distribution of
imagery;

- changes in sales mix, including sales of digital imagery, wholly-owned
imagery, geographic distribution and brand distribution;

- our ability to attract visitors to our websites;

- the frequency of repeat purchases by our customers;

- shifts in the nature and amount of publicity about us, our competitors or
the visual content industry;

- changes in the growth rate of the Internet;

- our ability to enhance our technology to accommodate any future growth in
our operations or customers;

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- changes in our pricing policies or the pricing policies of our
competitors;

- changes in government regulation; and

- costs related to potential acquisitions of technology or businesses.

WE MAY NOT BE ABLE TO COMPETE EFFECTIVELY AGAINST OUR EXISTING OR POTENTIAL
COMPETITORS.

The visual content industry is highly competitive. We compete directly with
a number of large and small visual content companies to provide imagery to
businesses and consumers. Our current or potential competitors include:

- other large visual content providers such as Visual Communications Group
and Corbis Corporation;

- specialized visual content companies that are well established in their
local, content or product specific markets;

- consumer oriented websites for art and related products; and

- commissioned photographers.

In addition to competitors and competitive factors applicable to the visual
content industry as a whole, our individual brands are subject to competitors
and competitive factors specific to each such brand.

We believe that the principal competitive factors in the visual content
industry are name recognition, company reputation, the quality, relevance and
diversity of the images, the quality of the contributing photographers and
cinematographers under contract with a company, effective use of developing
technology, customer service, pricing, accessibility of imagery, distribution
capability and speed of fulfillment.

Some of our existing and potential competitors may have significantly
greater financial, marketing and other resources or greater name recognition
than we have. Some of these competitors may be able to respond more quickly to
new or expanding technology and devote more resources to the development or
promotion of their services than we can. In addition, possible new entrants into
the visual content industry could increase if technological advances make
archiving, searching and digital delivery systems more affordable.

We cannot guarantee that we will be able to compete successfully against
existing or potential competitors.

WE MAY NOT BE ABLE TO ATTRACT CUSTOMERS TO OUR WEBSITES OR TAKE ADVANTAGE OF
THE GROWTH OF NEW MARKETS.

Our strategy depends, in large part, on our ability to attract customers to
our websites and to encourage and take advantage of the growth of new markets.
We will continue to seek strategic alliances and acquisitions to drive customers
to our websites and create new markets, products and services. We believe that
our ability to attract customers, facilitate market acceptance of our imagery,
related products and services and our brands, and enhance our sales and
marketing capabilities depends on our ability to develop and maintain
Internet-related strategic alliances and acquisitions. The market for
Internet-related alliances and acquisitions is highly competitive and we cannot
guarantee that we will be successful in negotiating additional alliances or
acquisitions on favorable terms, if at all. We also cannot be sure that any such
alliances or acquisitions will assist us in attaining our goals.

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THE SUCCESS OF OUR BUSINESS DEPENDS ON THE GROWTH IN DEMAND FOR THE DIGITAL
DOWNLOAD OF VISUAL CONTENT.

The success of our business depends on the continued and increasing
acceptance of the digital download method for purchasing visual content. The
growth and market acceptance of digital download is subject to a number of
factors, including:

- the availability of sufficient network bandwidth to enable purchasers to
rapidly download images;

- the number of relevant images available for purchase through digital
download as compared to those available through traditional methods;

- the level of consumer comfort with the process of downloading visual
content;

- the relative ease of the downloading process;

- concerns about the security of online transactions; and

- specific customer requirements that dictate the continued reliance on
analog imagery.

Our strategy is based in part on increasing acceptance of the Internet as a
method for distributing images. We may not overcome future technical challenges
associated with electronically delivering visual content reliably on a long-term
basis.

WE MAY NOT SUCCEED IN ESTABLISHING THE GETTYONE BRAND.

Historically, we have marketed each Getty brand as its own collection. We
have recently reorganized these brands into four customer divisions and plan to
launch the gettyone brand which will provide our customers with access to our
relevant imagery and services for creative professional customers on one
website. Successful positioning of the gettyone brand will largely depend on the
success of our advertising and promotional activities and our ability to provide
customers with high quality products and strong customer service. We believe
that a favorable customer reception of the gettyone brand is important to our
future success. If our brand enhancement strategy is unsuccessful, we may be
unable to realize potential benefits of gettyone.

OUR FUTURE SUCCESS DEPENDS ON OUR ABILITY TO RETAIN OUR EXECUTIVE CHAIRMAN
AND CHIEF EXECUTIVE OFFICER.

Our future success depends, in part, on the continued service of Mr. Mark
Getty, our Executive Chairman, and Mr. Jonathan Klein, our Chief Executive
Officer. Mr. Getty and Mr. Klein are each party to an employment agreement with
us for a minimum period of three years, commencing in February 1998 and August
1999, respectively. We do not have "key person" life insurance policies covering
either Mr. Getty or Mr. Klein.

CONSUMERS OF ART MAY NOT USE ART.COM FOR PURCHASES.

We recently entered into the consumer market through our acquisition of
Art.com. We may not be able to convert a large number of customers from
traditional shopping methods to online shopping for art and related products. If
we do not attract and retain a high volume of online

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customers at a reasonable cost, we may be unable to increase our consumer
revenues or achieve profitability in our consumer division.

OUR FUTURE SUCCESS DEPENDS ON OUR ABILITY TO IDENTIFY, ATTRACT, RETAIN AND
MOTIVATE HIGHLY SKILLED EMPLOYEES.

Our future success will depend upon our ability to identify, attract,
retain and motivate highly skilled technical, managerial, new product
development, editorial, merchandising, marketing and customer service employees.
Competition for qualified personnel is intense in the visual content industry.
We cannot guarantee that we will be successful in our efforts to attract such
personnel.

WE MAY EXPERIENCE SYSTEM FAILURES AND SERVICE INTERRUPTIONS ON OUR WEBSITES
THAT COULD RESULT IN ADVERSE PUBLICITY, CUSTOMER DISSATISFACTION AND REVENUE
LOSSES.

A key component of our growth strategy is the increased digitization of our
imagery and the distribution of such imagery and related products and services
over the Internet. As a result, our revenues are, and will continue to be,
dependent on the ability of our customers to access our websites. In the past,
we have experienced occasional system interruptions that make our websites
unavailable or prevent us from efficiently fulfilling orders. We cannot be sure
that we can prevent these interruptions in the future. System failures or
interruptions will inconvenience our users and may result in negative publicity
and reduce the volume of images we license online and the attractiveness of our
online products and services to our customers.

We will need to add additional software and hardware and upgrade our
systems and network infrastructure to accommodate increased traffic on our
websites and increased sales volume. Without these upgrades, we will face
additional system interruptions, slower response times, diminished customer
service, impaired quality and speed of order fulfillment and delays in our
financial reporting. We cannot accurately project the rate or timing of any
increases in traffic or sales volume on our websites and, therefore, the
integration and timing of these upgrades are uncertain.

The computer and communications hardware necessary to operate our corporate
group, and the Tony Stone Images and PhotoDisc e-commerce operations, is located
at a single facility in Seattle, Washington. Our other businesses have systems
located in other locations worldwide. Any of these systems and operations could
be damaged or interrupted by fire, flood, power loss, telecommunications
failure, earthquake and similar events. In addition, computer viruses, physical
or electronic break-ins and similar disruptions could cause system interruptions
or delays that could temporarily prevent us from providing services and
accepting and fulfilling customer orders. We do not have full redundancy for all
of our computer and telecommunications facilities and do not maintain a back-up
facility.

WE MAY NOT BE ABLE TO RESPOND TO RAPID TECHNOLOGICAL CHANGES RELATING TO THE
INTERNET.

To be successful, we must adapt to rapidly changing Internet technologies
by continually enhancing our products and services and introducing new services
to address the changing needs of our customers. We could incur substantial
development or acquisition costs if we are required to modify our services or
infrastructure to adapt to changes affecting companies providing services on the
Internet. If we are unsuccessful in adapting to these changes, or do not
sufficiently increase the features and functionality of our products and
services, our customers may ultimately switch to the product and service
offerings of our competitors. Our existing or potential competitors may develop
an improved method for distributing visual content through the Internet. If we
are unable to keep pace with the evolving technology of the Internet, the demand
for our imagery and related products and services may decrease.

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CERTAIN OF OUR STOCKHOLDERS CAN EXERCISE SIGNIFICANT INFLUENCE OVER OUR
BUSINESS AND AFFAIRS AND MAY HAVE INTERESTS THAT ARE DIFFERENT THAN YOURS.

Two groups of stockholders own substantial percentages of the outstanding
shares of our common stock.

The first group, the Getty Group, collectively owned approximately 25.8% of
the outstanding shares of our common stock as of September 24, 1999 and is
comprised of the following persons and entities:

- Getty Investments L.L.C.;

- The October 1993 Trust, a trust established for the benefit of Mr. Mark
Getty and members of his immediate family;

- The JD Klein Family Settlement, a trust established for the benefit of
Mr. Jonathan Klein and members of his immediate family;

- Mr. Mark Getty; and

- Mr. Jonathan Klein.

The second group, the Torrance Group, collectively owned approximately
11.5% of the outstanding shares of our common stock as of September 24, 1999 and
is comprised of the following persons and entities:

- PDI, L.L.C.;

- Mr. Mark Torrance;

- Ms. Wade Ballinger (Torrance); and

- certain of their family members.

Pursuant to a shareholders' agreement among us, the Getty Group and the
Torrance Group, none of the members of the Getty Group or the Torrance Group may
transfer their shares of our common stock except in accordance with the terms of
that agreement.

As a result of their share ownership, each of the Getty Group and the
Torrance Group will have significant influence over all matters requiring
approval of our stockholders, including the election of directors and the
approval of mergers or other business combinations. The substantial percentage
of our stock held by each of the Getty Group and the Torrance Group could also
make us a less attractive acquisition candidate or have the effect of delaying
or preventing a third party from acquiring control over us at a premium over the
then-current price of our common stock. In addition to ownership of common
stock, certain members of the Getty Group and the Torrance Group have management
and/or director roles within our company that increase their influence over us.

OUR RIGHT TO USE THE GETTY TRADEMARKS IS SUBJECT TO FORFEITURE IN THE EVENT
WE EXPERIENCE A CHANGE OF CONTROL.

We own trademarks and trademark applications through our subsidiaries
regarding the names Getty Images and Hulton Getty, and derivatives of those
names, including the name "Getty," and the related logo. We use "Getty" as a
corporate identity as do our subsidiaries and we may use "Getty" as a product or
service brand in the future. We refer to the above as the "Getty Trademarks." In
the event that a third party or parties not affiliated with the Getty family
acquire control of us, Getty Investments has the right to call for an assignment
to it, for a nominal sum, of

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all rights to the Getty Trademarks. In the event of an assignment, we will have
12 months to continue to use the Getty Trademarks, after which time we no longer
would have the right to use the Getty Trademarks. We cannot be sure that Getty
Investments' right to cause such an assignment would not have a negative impact
on the amount of consideration that a potential acquirer would be willing to pay
to acquire our common stock.

WE MAY NOT BE ABLE TO PREVENT THE MISUSE OF OUR IMAGERY AND WE MAY BE
SUBJECT TO INFRINGEMENT CLAIMS.

We rely on intellectual property laws and contractual restrictions to
protect our rights to our imagery. These afford us only limited protection.
Unauthorized parties have attempted, and may attempt, to improperly use our
owned or licensed imagery. We cannot guarantee that we will be able to prevent
the unauthorized use of our imagery or that we will be successful in ceasing
such use once it is detected.

We have been subject to a variety of third-party infringement claims in the
past and will likely be subject to similar claims in the future. We license a
portion of our visual content from photographers and cinematographers. We cannot
guarantee that each photographer or cinematographer holds the rights or releases
it claims or that such rights and releases are adequate. As a result, we may be
subject to infringement claims by third parties.

OUR INDEBTEDNESS COULD REDUCE OUR FLEXIBILITY AND MAKE US MORE VULNERABLE TO
ECONOMIC DOWNTURNS.

In May 1998, we issued $75.0 million of convertible subordinated notes due
2003. These notes bear interest at a rate of 4.75% per year and are convertible
into 2,600,000 shares of our common stock at a conversion price of approximately
$28.51 per share, subject to adjustments in certain circumstances. The notes are
unsecured subordinated obligations. The indenture governing the notes contains
provisions that require us to offer to repurchase the notes at 100% of the
principal amount thereof plus accrued and unpaid interest, upon a change of
control.

We may also incur additional indebtedness in the future. Such indebtedness
could have important consequences to you, including the following:

- our ability to make principal and interest payments on the convertible
subordinated notes could be negatively impacted;

- we may be unable to obtain necessary financing for working capital,
capital expenditures, debt service requirements and other purposes;

- our flexibility in planning for, or reacting to, changes in the business
and competition could be reduced; and

- we may be more vulnerable to economic downturns.

WE FACE YEAR 2000 RISKS ASSOCIATED WITH OUR SYSTEMS AND THOSE OF OUR
CUSTOMERS, SUPPLIERS AND THE INTERNET.

Year 2000 issues may adversely affect our business, suppliers, customers
and the Internet. Many currently installed computer systems and software
products are coded to accept or recognize only two digit entries in the date
code field. Consequently, on January 1, 2000, these systems and software
products may fail or malfunction because they may not be able to distinguish
21st century dates from 20th century dates. As a result, computer systems and
software used by many companies and governmental agencies may need to be
upgraded to comply with such Year 2000 requirements or risk system failure or
miscalculations causing disruptions of normal business
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operations. The failure of our internal systems or the systems used by our
customers or suppliers to become Year 2000 compliant could adversely affect our
normal operations. In addition, our ability to operate is largely dependent upon
the delivery of accurate electronic information through the Internet. See the
section entitled "Management's Discussion and Analysis of Financial Condition
and Results of Operations of Getty Images -- Risks Related to the Year 2000
Issue" for a more detailed description of our Year 2000 assessment.

FLUCTUATIONS IN FOREIGN EXCHANGE RATES COULD HAVE A NEGATIVE IMPACT ON THE
RESULTS OF OUR NON-U.S. BASED OPERATIONS.

We publish our consolidated financial statements in U.S. dollars and
conduct a portion of our business in currencies other than U.S. dollars,
particularly United Kingdom pounds sterling, Deutsche mark, French franc and the
Euro. As a result, we are exposed to changes in the value of currencies against
the U.S. dollar. Fluctuations in the values of currencies against the U.S.
dollar could affect the translation of the results of our non-U.S. based
operations into U.S. dollars for inclusion in our consolidated financial
statements. We cannot accurately predict the impact that future exchange rate
fluctuations may have on our results.

THE TRANSITION TO THE EURO WILL REQUIRE US TO MODIFY OUR EXISTING OPERATIONS
AND SYSTEMS.

A new European currency, the Euro, was implemented in January 1999 to
replace the separate currencies of eleven Western European countries. In order
to effectively handle transactions in the new currency, we are modifying our
systems and commercial arrangements. Modifications are necessary in areas such
as payroll, benefits and pension systems, contracts with suppliers and customers
and internal financial reporting systems. Although a three-year transition
period is expected during which transactions may also be made in the old
currency, we will use dual currency processes for our operations during the
transition period. We cannot be sure that we will identify or successfully solve
all problems associated with the transition or that a material disruption of our
business will not occur.

WE MAY NOT BE ABLE TO SECURE ADDITIONAL FINANCING TO MEET OUR FUTURE CAPITAL
NEEDS.

We currently anticipate that our available cash resources combined with the
net proceeds from this offering and borrowings under a senior credit facility,
which we are currently negotiating, will be sufficient to meet our anticipated
needs for working capital and capital expenditures for at least 12 months
following the date of this prospectus. After this time, if we are unable to
generate sufficient cash flows from operations to meet our anticipated needs for
working capital and capital expenditures, we will need to raise additional funds
to promote our products and services, develop new and enhanced services, respond
to competitive pressures or make acquisitions. We may be unable to obtain any
required additional financing on terms favorable to us, if at all. If adequate
funds are not available on acceptable terms, we may be unable to promote our
products and services successfully, develop or enhance services, respond to
competitive pressures or take advantage of acquisition opportunities. If we
raise additional funds through the issuance of equity securities, our
stockholders may experience dilution of their ownership interest, and the newly-
issued securities may have rights superior to those of our common stock. If we
raise additional funds by issuing new debt, we may be subject to limitations on
our operations, including limitations on the payment of dividends.

CERTAIN PROVISIONS OF OUR CORPORATE DOCUMENTS AND DELAWARE CORPORATE LAW MAY
DETER A THIRD-PARTY FROM ACQUIRING OUR COMPANY.

Our board of directors has the authority, without stockholder approval, to
issue up to 5,000,000 shares of preferred stock and to fix the rights,
preferences, privileges and restrictions of
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<PAGE> 17

such shares without any further vote or action by our stockholders. This
authority, together with certain provisions of our amended and restated
certificate of incorporation, may have the effect of making it more difficult
for a third party to acquire, or of discouraging a third party from attempting
to acquire, control of our company. This could occur even if our stockholders
consider such change in control to be in their best interests. In addition, the
concentration of beneficial ownership of our common stock in the Getty Group and
the Torrance Group, along with certain provisions of Delaware law, may have the
effect of delaying, deterring or preventing a takeover of our company.

RISKS RELATED TO INTERNET COMMERCE

IF THE USE OF THE INTERNET AND E-COMMERCE DOES NOT GROW AS ANTICIPATED, OUR
BUSINESS COULD BE SERIOUSLY HARMED.

Our growth strategy largely depends on the increased acceptance of the
Internet as a medium of commerce. Rapid growth in the use of the Internet is a
recent phenomenon. As a result, acceptance and use may not continue to develop
at historical rates and a broad base of our customers may not adopt or use the
Internet as a medium of commerce. Demand and market acceptance of our imagery
and related products over the Internet may not continue.

Our business could be harmed if:

- use of the Internet and other online services does not continue to
increase or increases more slowly than anticipated;

- the technology underlying the Internet and other online services does not
effectively support any expansion that may occur; and

- the Internet and other online services do not create a viable commercial
marketplace, inhibiting the development of e-commerce and reducing the
need for delivery of our products and services online.

AN INCREASE IN GOVERNMENT REGULATION OF THE INTERNET AND E-COMMERCE COULD
HAVE A NEGATIVE IMPACT ON OUR BUSINESS.

We are subject to a number of regulations applicable to businesses
generally, as well as laws and regulations directly applicable to e-commerce.
Although existing laws and regulations affecting e-commerce are minimal, state,
federal and foreign governments may adopt legislation regulating the Internet
and e-commerce in the near future. Any such legislation or regulation could
impede the growth of the Internet and decrease its acceptance as a
communications and commerce medium. If a decline in the use of the Internet
occurs, businesses and consumers may decide in the future not to use our online
services. Any significant decrease in the use of our online services could
negatively affect our business.

New laws and regulations could potentially govern or restrict any of the
following issues:

- user privacy;

- pricing and taxation of goods and services over the Internet;

- website content;

- consumer protection; and

- characteristics and quality of products and services offered over the
Internet.

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Future legislation could expose companies involved in the Internet or
e-commerce to potential liability.

ONLINE SECURITY RISKS AND CONCERNS MAY HARM OUR BUSINESS.

A significant barrier to e-commerce and online communications is the secure
transmission of confidential information over public networks. Advances in
computer capabilities, new discoveries in the field of cryptography or other
events or developments could result in compromises or breaches of our security
systems or those of other websites to protect proprietary information. If any
well-publicized compromises of security were to occur, it could have the effect
of substantially reducing the use of the Internet for commerce and
communications. Anyone who circumvents our security measures could
misappropriate proprietary information or cause interruptions in our services or
operations.

The Internet is a public network, and data is sent over it from many
sources. In the past, computer viruses, programs that disable or impair
computers, have been distributed and have rapidly spread over the Internet.
Computer viruses could be introduced into our systems or those of our customers,
which could disrupt the delivery of our imagery products and services or make
them inaccessible to our customers. We may be required to expend significant
capital resources to protect against the threat of security breaches or to
alleviate problems caused by such breaches. To the extent that our activities
may involve the storage and transmission of proprietary information, such as
credit card numbers, security breaches could expose us to a risk of loss or
litigation and possible liability. Our security measures may be inadequate to
prevent security breaches and our business could be harmed if we do not prevent
them.

RISKS RELATED TO THIS OFFERING

OUR STOCK PRICE HAS BEEN VOLATILE.

The market price of our common stock has been volatile. For example, in the
fourth quarter of 1998, the market price for our common stock ranged from $8.625
to $18.125. Trading prices may continue to fluctuate in response to a number of
events and factors, including the following:

- quarterly variations in operating results and announcements of
innovations;

- new products, services and strategic developments by us or our
competitors;

- business combinations and investments by us or our competitors;

- changes in our revenues, expense levels or profitability;

- changes in financial estimates and recommendations by securities
analysts;

- failure to meet the expectations of public market analysts;

- performance by other visual content companies; and

- news reports relating to trends in the visual content, Internet or other
product or service industries.

Any of these events may cause the price of our shares to fall. In addition,
the stock market in general and the market prices for e-commerce companies in
particular have experienced significant volatility that often has been unrelated
to the operating performance of such companies. These broad market and industry
fluctuations may adversely affect the market price of our shares, regardless of
our operating performance.

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FUTURE SALES OF OUR STOCK BY EXISTING STOCKHOLDERS COULD NEGATIVELY IMPACT
OUR STOCK PRICE.

Sales, or the possibility of sales, of substantial numbers of shares of our
common stock in the public market could adversely affect prevailing market
prices of shares of our common stock, potentially resulting in losses to
investors. Some of our stockholders, including the Getty Group, the Torrance
Group and certain former stockholders of Art.com, have the right, pursuant to
various registration rights agreements, to request that we register certain of
their shares of common stock for resale under the Securities Act of 1933, as
amended. In addition, our employees hold a significant number of options to
purchase shares, many of which are presently exercisable. Many employees may
exercise their options and sell shares shortly after such options become
exercisable, particularly if they need to raise funds to pay for the exercise of
such options or to satisfy tax liabilities that they may incur in connection
with exercising their options.

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

Throughout this prospectus and the information incorporated herein by
reference, we make "forward-looking statements" within the meaning of Section
27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act
of 1934, as amended. Forward-looking statements include the words "may," "will,"
"estimate," "intend," "continue," "pro forma," "expect" or "anticipate" or other
similar words. The forward-looking statements contained in this prospectus are
generally located in sections entitled "Prospectus Summary," "The Transaction,"
"Risk Factors," "Capitalization," "Management's Discussion and Analysis of
Financial Condition and Results of Operations of Getty Images," "Management's
Discussion and Analysis of Financial Condition and Results of Operations of The
Image Bank," and "Business," but may be found in other sections as well. These
forward-looking statements generally relate to our plans and objectives for
future operations and are based on management's reasonable estimates of future
results or trends. Although we believe that our plans and objectives reflected
in or suggested by such forward-looking statements are reasonable, we may not
achieve such plans or objectives and cannot guarantee future results, levels of
activity, performance or achievements. Actual results may differ from projected
results due, but not limited, to unforeseen developments, including those
discussed above.

You should read this prospectus and the documents incorporated herein by
reference completely and with the understanding that actual results may be
materially different from what we expect. We undertake no obligation after the
date of this prospectus to update any forward-looking statements even though our
situation may change in the future.

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THE TRANSACTION

OVERVIEW

On September 20, 1999, we signed a stock purchase agreement with Eastman
Kodak Company and Kodak S.A., an affiliate of Eastman Kodak Company, to purchase
all of the capital stock of The Image Bank, Inc. and The Image Bank France S.A.,
which we collectively refer to as "The Image Bank." The aggregate purchase price
for the stock of The Image Bank is approximately $173.0 million plus
approximately $10.0 million to compensate Eastman Kodak Company for a tax
election made for our benefit. We intend to fund the acquisition partially
through a senior credit facility, which we are currently negotiating, and
partially through the proceeds from this offering. The stock purchase agreement
allows us to pay approximately one-half of the purchase price with a promissory
note that will accrue interest at a rate of 11.0% per year. Interest payments
under the note will be payable at the end of each month, and the principal
amount of the note will become due one year after the closing of the
acquisition. We do not currently expect to pay any portion of the purchase price
with the promissory note. The acquisition is expected to close on or before
December 15, 1999, although we have the option under the stock purchase
agreement to extend the closing beyond that date. The closing of the acquisition
is not contingent on the closing of this offering.

Following our acquisition of The Image Bank, we believe we will be the
largest global provider of visual content in terms of size, revenue and
distribution reach with an estimated combined collection of more than 60 million
still images and more than 27,000 hours of film footage.

THE STOCK PURCHASE AGREEMENT

The stock purchase agreement provides that, at closing, Eastman Kodak
Company and Kodak S.A. will sell us all of the outstanding shares of capital
stock of The Image Bank. At the time we commenced acquisition discussions with
Eastman Kodak Company, we paid them a deposit of $1.0 million, which will be
applied toward the purchase price. We are permitted to assign the right to
acquire any of the shares of The Image Bank to any of our affiliates, so long as
we guarantee the obligations of such affiliates under the stock purchase
agreement. We may close the acquisition on or before December 15, 1999 by paying
the entire purchase price in cash or in a combination of at least $91.0 million
in cash and a promissory note for the balance of the purchase price. If we are
unprepared to close the acquisition by December 15, 1999, we may extend the
closing until February 15, 2000 by paying Eastman Kodak Company a non-refundable
fee of $2.0 million. Alternatively, we may terminate our obligations under the
stock purchase agreement by paying Eastman Kodak Company a non-refundable fee of
$4.0 million, in which event Eastman Kodak Company would also retain the $1.0
million deposit previously paid.

In the stock purchase agreement, Eastman Kodak Company has made
representations and warranties regarding The Image Bank and its business. We
have also made representations and warranties concerning our business and our
investment intent. Eastman Kodak Company and Kodak S.A. have agreed that, until
the closing date, they will operate The Image Bank in the ordinary course and
will cause The Image Bank to refrain from taking certain actions without our
consent.

Several conditions must be met, or waived, before we can close the
acquisition, including the following:

- all waiting periods under U.S. and French or European Union antitrust
laws must have expired or terminated;

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- no injunctions may be in effect prohibiting consummation of the
transaction;

- no litigation may be pending seeking to prohibit the transaction or
substantial damages as a result of the transaction;

- all required approvals must have been obtained;

- all representations and warranties made by each of the parties must be
true in all material respects;

- all covenants and agreements required to be performed by the parties
prior to closing must have been performed in all material respects;

- all tax sharing agreements involving The Image Bank must have been
terminated;

- The Image Bank's auditors must have provided us with consents and comfort
letters with respect to the registration statement related to this
prospectus; and

- no change that is materially adverse to The Image Bank may have occurred
at any time after June 30, 1999 with respect to the assets, liabilities,
properties, business, operations or condition of The Image Bank,
excluding general economic changes, changes in currency exchange rates,
changes that may affect the visual content industry generally, the
voluntary or involuntary termination of certain executives of The Image
Bank, and changes attributable to the acquisition.

We are being indemnified by Eastman Kodak Company under the stock purchase
agreement for any losses we incur, sustain or suffer directly or indirectly
relating to or arising out of any of the following:

- any fact or circumstance that constitutes a failure or breach of any
representation or warranty of Eastman Kodak Company or Kodak S.A.
contained in the stock purchase agreement;

- any act or omission that constitutes a breach or non-fulfillment of any
covenant or agreement of Eastman Kodak Company or Kodak S.A. contained in
the stock purchase agreement;

- any taxes payable by The Image Bank for any period through and including
the closing date;

- any obligation or liability arising under ERISA and payable by or imposed
upon The Image Bank by virtue of its status at any time as a subsidiary
of Eastman Kodak Company or Kodak S.A. or a member of their consolidated
or affiliated group; and

- the litigation and claims listed on a specified schedule attached to the
stock purchase agreement.

Our indemnification claims under the first two bullets in the immediately
preceding list are not recoverable unless our total losses exceed $1.0 million,
may not be applied to an indemnifiable loss unless the particular loss exceeds
$25,000 per loss, and total recovery by us may not exceed $60.0 million, subject
to certain exceptions.

THE IMAGE BANK

The Image Bank is among the top providers of visual content to the
advertising, design, publishing, corporate, broadcast and editorial markets. We
believe that The Image Bank is the market leader in the motion image market and
is a leading source of contemporary stock

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photography, archival photography, and illustrative artwork worldwide. Archive
Holdings, a division of The Image Bank, has one of the leading collections of
archival still and motion imagery, and has a reputation for strong customer
service and support. Upon consummation of the acquisition, The Image Bank's
stock image collection will add an estimated 30 million still images and an
estimated 15,000 hours of film footage to our collections. The Image Bank
generated EBITDA of approximately $7.4 million on sales of approximately $70.8
million in 1998. For the six months ended June 30, 1999, The Image Bank
generated EBITDA of approximately $3.1 million on sales of approximately $38.1
million.

The Image Bank has a long history in the visual content market and has
established brand awareness and a reputation for quality images and services.
The Image Bank employs approximately 475 people in ten offices throughout the
world, including offices in the United States, France and Hong Kong. The Image
Bank has also established an extensive network of franchised offices in North
America, Europe, Asia Pacific, South America and Africa. This network enables
The Image Bank to provide access to images worldwide, as well as localized
service and image distribution to creative professionals in major global media
markets.

The Image Bank is organized into four major operating units:

The Image Bank Division is comprised of one of the most extensive image
collections in the visual content industry with an estimated 10 million
contemporary still images in categories such as lifestyle, sports, wildlife,
business, medical and other commercial imagery, and an estimated 5,000 hours of
contemporary film footage, primarily marketed to professionals in the
advertising, design, corporate, editorial and broadcast industries;

Archive Holdings is a collection of an estimated 20 million news and stock
photographs marketed as Archive Photos and an estimated 10,000 hours of
historical, documentary and motion picture film footage marketed as Archive Film
that is accessible through a proprietary searchable database of images owned by
The Image Bank or available in the public domain, primarily marketed to
corporate, broadcast, advertising and editorial users seeking historical images;

Swanstock is a collection of museum quality photographic fine art images;
and

Artville is one of the leading collections of illustration imagery for
creative professionals in the advertising, corporate, educational, graphic
design, SOHO and consumer markets and principally serves buyers of royalty-free
images.

We believe that, following the completion of the acquisition, we will be
able to enhance the value of our combined businesses by:

Moving the Core Collection of The Image Bank's Contemporary Stock
Photography Content Online. The ability to provide full e-commerce has become
increasingly critical in the visual content industry over the past 12 months and
we believe The Image Bank has suffered from its lack of e-commerce capabilities.
We have experience in e-commerce, launching Tony Stone Images' e-commerce
website (www.tonystone.com) in October 1998, and believe that we can effectively
transfer an analog stock photography business to the Internet. Our immediate
focus upon completion of the acquisition will be to digitize, and make available
on the Internet, The Image Bank's core collection of contemporary stock
photography.

Supplementing Our Product Offerings With The Image Bank Collections. The
coordination of our existing content collections with those of The Image Bank
will enable us to provide our customers with one of the most comprehensive
collections of imagery. By integrating The Image Bank's collections into
gettyone, the vertical portal for the creative professional that we plan to
launch in the fourth quarter of 1999, we intend to make leading brands in the
contemporary licensed stock photography sector available for search, selection,
purchase and distribution in one location. In

21
<PAGE> 23

addition, we believe The Image Bank's Artville and Swanstock brands will
complement the breadth of our existing specialist collections which we plan to
make available on our gettyone website.

Promoting Our Enhanced Archival Collection. Archive Photos and Archive Film
are among the leading collections of North American archival imagery and have an
established customer base. We believe we will be able to complement these
collections with Hulton Getty's collection of European archival imagery. In
addition, we believe the integration of Archive Photos and Archive Film into our
Press and Editorial division will enhance our position as one of the leading
providers of imagery to the magazine and publishing community.

Augmenting Both Our Product Offering and Market Share In Film Footage. We
believe The Image Bank possesses the largest collection of film footage
worldwide, with a reputation for product and technology quality and an
established customer base. We believe that the coordination of The Image Bank
with our Energy Film Library brand will help us take advantage of growth in this
sector.

Further Expand International Reach and Distribution. The Image Bank has a
strong market position in regions where the visual content industry is less well
developed, such as South America and the Asia Pacific region. We believe that we
will be able to enhance the distribution of our broader content collections in
these areas by combining the companies' distribution networks. There is also
considerable overlap in terms of distribution in countries where we have
established wholly-owned operations. In these countries, we believe we will be
able to achieve efficiencies by combining the distribution networks.

22
<PAGE> 24

USE OF PROCEEDS

We estimate that the net proceeds from our sale of 5,000,000 shares of our
common stock will be approximately $ , assuming a public offering price
of $ per share and after deducting estimated underwriting discounts and
commissions and estimated offering expenses payable by us. If the over-allotment
option is exercised in full, we estimate that the net proceeds will be
approximately $ .

The principal purpose of this offering is to finance the acquisition of The
Image Bank. We expect to use the remaining net proceeds, if any, for general
corporate purposes, including working capital and the possible acquisition of
businesses, products or technologies that are complementary to our business.

23
<PAGE> 25

CAPITALIZATION

The following table sets forth our capitalization as of June 30, 1999. The
pro forma information reflects the issuance and sale of the shares of common
stock offered by us in this offering at an assumed public offering price of
$ per share. The outstanding share information excludes:

- 7,819,264 shares of common stock issuable upon exercise of options
outstanding as of June 30, 1999; and

- 5,154,566 shares of common stock reserved for future issuance under our
Getty Images, Inc. 1998 Stock Incentive Plan as of June 30, 1999.

This table should be read in conjunction with "Management's Discussion and
Analysis of Financial Condition and Results of Operations of Getty Images" and
our financial statements and accompanying notes and other financial data
included elsewhere in this prospectus.

<TABLE>
<CAPTION>
JUNE 30, 1999
-------------------------
ACTUAL(1) PRO FORMA(2)
--------- ------------
(IN THOUSANDS)
<S> <C> <C>
Cash and cash equivalents.................................. $ 14,394 $ 2,577
Short term debt............................................ 15,333 15,333
======== ========
Long term debt............................................. 72,778 123,182
Stockholders' equity:
Common stock, $.01 per share; 75,000,000 shares
authorized, 35,389,305 shares issued and outstanding
actual; and 75,000,000 shares authorized, 40,389,305
shares issued and outstanding pro forma............... 353 404
Additional paid-in capital............................... 492,490 618,124
Retained earnings and cumulative translation
adjustments........................................... (54,495) (54,495)
-------- --------
Total stockholders' equity................................. 438,348 564,033
-------- --------
Total capitalization....................................... $511,126 $687,215
======== ========
</TABLE>

- ---------------
(1) Actual amounts are derived from our unaudited consolidated balance sheet as
of June 30, 1999.

(2) Pro forma figures reflect the financing, cash and debt acquired and cash
paid or to be paid in connection with the acquisitions of Art.com and The
Image Bank.

24
<PAGE> 26

COMMON STOCK PRICE RANGE

Our common stock is traded on the Nasdaq National Market under the symbol
"GETY." The following table sets forth, for each of the quarterly periods
indicated, the high and low sales prices of our common stock as reported on the
Nasdaq National Market.

<TABLE>
<CAPTION>
COMMON STOCK PRICE
------------------
HIGH LOW
------- -------
<S> <C> <C>
Year ended December 31, 1997
First Quarter............................................. $18.000 $14.000
Second Quarter............................................ 15.250 11.500
Third Quarter............................................. 19.500 10.750
Fourth Quarter............................................ 18.250 13.000
Year ended December 31, 1998
First Quarter............................................. 27.250 13.500
Second Quarter............................................ 27.250 16.875
Third Quarter............................................. 27.625 13.875
Fourth Quarter............................................ 18.125 8.625
Year ending December 31, 1999
First Quarter............................................. 25.125 15.875
Second Quarter............................................ 30.500 17.000
Third Quarter (Through September 24, 1999)................ 26.625 16.250
</TABLE>

On September 24, 1999, the last reported sales price of our common stock as
reported on the Nasdaq National Market was $24.4375 per share. There were 71
holders of record of our common stock as of September 24, 1999.

DIVIDEND POLICY

We have not paid or declared any dividends on our common stock since our
inception and anticipate that our future earnings will be retained to finance
the continuing development of our business. The payment of any future dividends
will be at the discretion of our board of directors and will depend upon, among
other things, future earnings, the success of our business activities,
regulatory and capital requirements, our general financial condition and general
business conditions. In addition, our loan agreements may restrict our ability
to pay future dividends. Investors should not purchase our common stock with the
expectation of receiving dividends.

25
<PAGE> 27

SELECTED CONSOLIDATED FINANCIAL DATA OF GETTY IMAGES

The following selected consolidated financial data is qualified by
reference to, and should be read in conjunction with, our consolidated financial
statements and notes thereto and the section entitled "Management's Discussion
and Analysis of Financial Condition and Results of Operations of Getty Images."
The statement of operations data and cash flow data for the five years ended
December 31, 1998 and the balance sheet data for the five years ended December
31, 1998 are derived from our consolidated financial statements which have been
audited by PricewaterhouseCoopers, independent auditors. Interim statement of
operations data and cash flow data for the periods ended June 30, 1998 and June
30, 1999 and the balance sheet data for the periods ended June 30, 1998 and June
30, 1999 are derived from our unaudited financial statements which, in the
opinion of management, reflect all adjustments necessary for a fair presentation
of that data. Historical results are not indicative of the results to be
expected in the future.

<TABLE>
<CAPTION>
TONY STONE
IMAGES LIMITED GETTY COMMUNICATIONS PLC
(PREDECESSOR COMPANY) (PREDECESSOR COMPANY) GETTY IMAGES, INC.
--------------------- -------------------------------- -----------------------------------------
YEAR ENDED YEAR ENDED SIX MONTHS ENDED
DECEMBER 31, YEAR ENDED DECEMBER 31, DECEMBER 31, JUNE 30,
1994 1995(1) 1996 1997 1998(2) 1998 1999
--------------------- -------- -------- -------- ------------------ -------- --------
(UNAUDITED)
(IN THOUSANDS EXCEPT PER SHARE DATA)
<S> <C> <C> <C> <C> <C> <C> <C>
STATEMENT OF OPERATIONS
DATA:
Sales...................... $42,052 $ 63,021 $ 85,014 $100,797 $ 185,084 $ 86,057 $107,107
Cost of sales.............. 16,290 24,714 32,156 37,514 52,830 25,516 28,605
------- -------- -------- -------- --------- -------- --------
Gross profit............... 25,762 38,307 52,858 63,283 132,254 60,541 78,502
Selling, general and
administrative
expenses................. 19,140 27,655 37,250 43,936 96,904 45,585 60,796
Amortization of
intangibles.............. 1,134 2,380 2,155 3,253 36,961 16,903 27,021
Depreciation............... 2,267 3,605 5,486 8,214 14,397 6,445 10,061
Non-recurring integration
and restructuring
costs.................... -- -- -- -- 13,755 9,137 --
------- -------- -------- -------- --------- -------- --------
Operating income/(loss).... 3,221 4,667 7,967 7,880 (29,763) (17,529) (19,376)
Net interest
(expense)/income......... (218) (1,468) (1,951) 1,187 (2,986) (1,319) (1,773)
Net exchange
gains/(losses)........... 247 89 (306) (198) (124) (59) (371)
Legal settlement........... -- -- -- (974) -- -- --
------- -------- -------- -------- --------- -------- --------
Income/(loss) before income
taxes.................... 3,250 3,288 5,710 7,895 (32,873) (18,907) (21,520)
Income taxes............... (1,556) (2,017) (2,982) (3,873) (2,680) (369) (2,168)
Extraordinary items........ -- -- -- -- (830) (830) --
------- -------- -------- -------- --------- -------- --------
Net income/(loss).......... $ 1,694 $ 1,271 $ 2,728 $ 4,022 $ (36,383) $(20,106) $(23,688)
------- -------- -------- -------- --------- -------- --------
Net income/(loss) per
share(3)................. $ .05 $ .10 $ .11 $ (1.25) $ (.72) $ (.74)
-------- -------- -------- --------- -------- --------
Shares used in computing
per share amount(3)...... 27,442 27,442 37,908 29,160 27,787 32,134
-------- -------- -------- --------- -------- --------
Net income per ADS(4)...... $ .11 $ .20 $ .21 N/A N/A N/A
-------- -------- -------- --------- -------- --------
OTHER OPERATING DATA:
EBITDA(5).................. $ 6,622 $ 10,652 $ 15,608 $ 19,347 $ 35,350 $ 14,956 $ 17,706
------- -------- -------- -------- --------- -------- --------
EBITDA per share........... $ .39 $ .57 $ .51 $ 1.21 $ .54 $ .55
-------- -------- -------- --------- -------- --------
CASHFLOW DATA:
Net cash provided by/(used
in):
Operating activities....... $ 5,202 $ 6,957 $ 13,502 $ 13,174 $ 7,222 $ 5,220 $ 2,689
Investing activities....... (5,296) (24,689) (25,528) (35,447) (107,869) (83,667) (17,455)
Financing activities....... (314) 19,030 66,311 (3,052) 85,003 84,953 16,387
Exchange differences....... 83 (18) 2,755 (4,380) 2,560 423 (3,377)
------- -------- -------- -------- --------- -------- --------
Net increase/(decrease) in
cash and cash
equivalents.............. $ (325) $ 1,280 $ 57,040 $(29,705) $ (13,084) $ 6,929 $ (1,756)
------- -------- -------- -------- --------- -------- --------
BALANCE SHEET DATA:
Cash and cash
equivalents.............. $ 1,208 $ 1,899 $ 58,939 $ 29,234 $ 16,150 $ 36,163 $ 14,394
Total assets............... 25,334 71,024 163,504 171,638 462,863 491,646 581,597
Long-term debt, net of
current maturities....... 2,617 8,704 17,910 14,657 72,354 72,014 72,778
Total stockholders'
equity................... 5,984 27,012 113,523 119,539 343,927 363,236 438,348
------- -------- -------- -------- --------- -------- --------
</TABLE>

- ------------------------
(1) Reflects the combination of the results of Tony Stone Images, the
predecessor of Getty Communications plc and Getty Images, for the period
from January 1 through March 13, 1995 with the results of Getty
Communications plc

26
<PAGE> 28

for the period from March 14 through December 31, 1995. Due to the nature of
this combination, the presentation of combined results for the two periods
in 1995 does not conform with U.S. GAAP.

(2) Reflects the combination of the consolidated statement of operations of
Getty Communications plc, our predecessor company, for the period January 1,
1998 through February 9, 1998 and our consolidated statement of operations
for the period February 10, 1998 through December 31, 1998.

(3) Net income per share has not been computed for periods which relate to Tony
Stone Images as compared to Getty Communications plc or Getty Images.
Amounts for the year ended December 31, 1995 have been computed assuming the
same number of shares outstanding as determined for Getty Communications plc
for the period March 14, 1995 through December 31, 1995.

(4) Net income per Getty Communications plc ADS is calculated by adjusting net
income per share data for the ratio of two Getty Communications plc Class A
Ordinary Shares per Getty Communications plc ADS.

(5) EBITDA is defined as earnings before interest, taxes, exchange
gains/(losses), amortization, depreciation, non-recurring integration and
restructuring costs, legal settlement and extraordinary items. Thus, EBITDA
with respect to us comprises sales less cost of sales and selling, general
and administrative expenses. We believe that EBITDA provides investors and
analysts with a measure of operating income unaffected by the financing and
accounting effects of acquisitions and assists in explaining trends in our
operating performance. EBITDA should not be considered as an alternative to
operating income as an indicator of our operating performance or to cash
flows as a measure of our liquidity. EBITDA may not be comparable to other
similarly titled measures used by other companies.

27
<PAGE> 29

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

The following should be read in conjunction with our "Selected Consolidated
Financial Data" and the other financial information contained elsewhere in this
prospectus. In the following discussion, "we," "us" and "our" refer to Getty
Communications plc in 1996 and 1997 and Getty Communications plc combined with
Getty Images, Inc. for 1998. All financial data referred to in the following
discussion has been prepared in accordance with United States Generally Accepted
Accounting Principles (U.S. GAAP).

In addition to historical information, the discussion in this section may
contain certain forward-looking statements that involve risks and uncertainties.
The forward-looking statements relate to, among other things, operating results,
trends in sales, gross profit, operating expenses, effective tax rates,
anticipated expense levels, liquidity and capital resources, Year 2000 expenses
and the effect of foreign currency hedging transactions. Our actual results
could differ materially from those anticipated by these forward-looking
statements due to factors including, but not limited to, those set forth under
the section entitled "Risk Factors," and elsewhere in this prospectus.

OVERVIEW

Founded in March 1995 as Getty Communications plc, Getty Images, Inc. is a
leading global visual content provider, offering imagery over the Internet and
through a diverse set of distribution channels and media including CD ROMs,
demonstration reels and catalogs. We estimate we have over 30 million still
images and more than 15,000 hours of film footage. We own or control visual
content across major categories of the industry. Through our e-commerce enabled
websites and our international network of wholly-owned offices, as well as
agents, distributors and affiliates in 51 countries, we provide both businesses
and consumers with effective access to image and footage products.

Our visual content product brands are organized into the following
divisions to serve our four major types of customers:

Creative Professional Division. Tony Stone Images and PhotoDisc, leaders in
licensed and royalty-free contemporary stock photography, and Energy Film
Library, a leading provider of stock film footage;

Press and Editorial Division. Allsport, a leading global provider of sports
imagery; Liaison Agency, a leading North American news and features agency;
Hulton Getty, one of the world's largest commercially available collections of
archival photography; and Online USA, Inc., a leading provider of celebrity news
and event photography over the Internet that we acquired in August 1999;

Business User Division. EyeWire, a leading provider of royalty-free
imagery, footage, audio, typefaces, illustration, clip art and other design
products to business users that we acquired in August 1999; and

Consumer Division. Art.com, a leading destination for custom framed and
unframed art and art-related supplies for consumers on the Internet that we
acquired in May 1999.

Our sales are primarily derived from the marketing of image reproduction
and broadcasting rights to a range of business customers. Sales generally
consist of a large number of relatively small transactions involving the sale or
licensing of single images, video and film clips or CD ROM products containing
between 100 and 300 images. We use a variety of distribution platforms,
including digital distribution via the Internet and CD ROM, as well as analog
distribution of

28
<PAGE> 30

35mm film, video and analog transparencies. Price is generally determined by
resolution size and the extent of rights granted over the use of the image or
clip and can vary significantly across geographic markets and customer groups.
We also generate sales from subscription or bulk purchase deals where customers
are provided access to imagery online. In the case of our consumer business, we
principally sell framed and unframed art products to consumers over the Internet
with payment typically being made using a credit card.

Revenue arises from three principal types of sales:

Fixed license sales are recognized when a license agreement has been
completed with the customer for the use of the image, and the image has been
made available for use. Fixed license pricing terms do not call for additional
fees beyond the fixed license amount, and our customer is contractually
obligated to pay the fixed license amount upon agreement of the license terms
and availability of the image for use by the customer.

Royalty-free sales, or sales in which the user pays a one-time fee for
unlimited use, are recognized upon the shipment of the CD ROM or at the time
images are downloaded by the customer.

Consumer sales are recognized upon shipment of the product.

Circumstances in which sales are refunded are rare, and refunds are netted in
the recognition of revenue. Sales are recorded at invoiced amounts less sales
tax, if applicable. "Digital sales" are defined as those sales that are
transacted on the Internet or by CD ROM, and "e-commerce sales" are defined as
the Internet portion of digital sales.

Our cost of sales primarily consists of commission payments to contributing
photographers and cinematographers. These suppliers are under contract with us
and receive payments of up to 50.0% of sales depending on the type of product
and where and how the product is sold. We own a significant number of the images
in our collections and these images do not require commission payments. Cost of
sales also includes, to the extent applicable, handling and shipping costs for
duplicate transparencies, the cost of CD ROM production and costs associated
with framing and shipping art products. As a result, our gross margin is
impacted by the mix of sales conducted digitally on the Internet, sales of
wholly-owned imagery, geographic distribution of sales and brand sales mix.

Our selling, general and administrative expenses include salaries and
related staff costs, premises and utility costs, and sales and marketing costs.

We amortize goodwill and depreciate the cost of the investment in duplicate
transparencies, digital files, archival picture collections, computer systems
and other fixed assets over their expected useful lives. The acquisitions of
PhotoDisc and Allsport in February 1998 have generated approximately $241.9
million in goodwill and $51.0 million in other intangibles. The acquisitions of
Art.com in May 1999 and EyeWire in August 1999 have generated approximately
$122.2 million and $32.0 million of goodwill, respectively. These acquisitions
will result in a substantial charge to be amortized against our earnings in
future periods. We are amortizing goodwill relating to PhotoDisc and Allsport
over 20 years, goodwill relating to Art.com over three years, and goodwill
relating to EyeWire over seven years. We amortize other intangibles over one to
three years.

As a result of our various acquisitions and their financial and goodwill
accounting effects on net income, we believe that EBITDA provides stockholders,
investors and analysts with an appropriate measure of our operating performance.
We define EBITDA as earnings before interest, taxes, exchange gains/(losses),
depreciation, amortization, non-recurring integration and restructuring costs,
legal settlement and extraordinary items. EBITDA should not be considered as an
alternative to operating income as an indicator of our operating performance or
to cash flows as a measure of our liquidity.
29
<PAGE> 31

Following the acquisitions of PhotoDisc and Allsport in February 1998, we
commenced a program to integrate our businesses. This resulted in integration
and restructuring charges totaling $13.8 million. The charges included
restructuring costs, severance costs, consulting and professional fees, systems
and process integration costs, and costs associated with contract renegotiations
and terminations.

Restructuring costs, amounting to $10.1 million in 1998, were for estimated
exit costs associated with the closure of certain operating facilities,
including asset writedowns and termination costs. The largest element of the
asset writedowns consisted of system assets, primarily hardware and software,
both of which had shortened useful lives as a result of the restructuring plans.
Termination costs arose in relation to property related exit costs, termination
of agents and photographer contracts and employee terminations. Integration
costs of $3.7 million were associated with the activities of teams responsible
for integrating our businesses for the benefit of future operations and included
items such as consulting and professional fees, systems and process integration
costs and contract renegotiation and termination costs. We may incur additional
non-recurring charges associated with the elimination of redundant positions and
costs associated with the potential closure or consolidation of facilities in
the remainder of 1999. We believe these charges will not exceed $10.0 million.

30
<PAGE> 32

RESULTS OF OPERATIONS

The following table is derived from our consolidated financial statements
and sets forth certain items for the periods indicated.

<TABLE>
<CAPTION>
GETTY IMAGES, INC.
GETTY COMMUNICATIONS PLC ----------------------------------------
------------------------ YEAR ENDED SIX MONTHS ENDED
YEAR ENDED DECEMBER 31, DECEMBER 31, JUNE 30,
1996(1) 1997 1998 1998 1999
--------- --------- ------------ -------- --------
(UNAUDITED)
(IN THOUSANDS, EXCEPT PERCENTAGES)
<S> <C> <C> <C> <C> <C>
INCOME STATEMENT DATA:
Sales.............................. $ 85,014 $100,797 $185,084 $ 86,057 $107,107
Gross profit....................... 52,858 63,283 132,254 60,541 78,502
Selling, general and administrative
expenses......................... (37,250) (43,936) (96,904) (45,585) (60,796)
Amortization of intangibles and
depreciation..................... (7,641) (11,467) (51,358) (23,348) (37,082)
Non-recurring integration and
restructuring costs.............. -- -- (13,755) (9,137) --
Operating (loss)/income............ 7,967 7,880 (29,763) (17,529) (19,376)
Net interest (expense)/income...... (1,951) 1,187 (2,986) (1,319) (1,773)
Net exchange losses................ (306) (198) (124) (59) (371)
Legal settlement................... -- (974) -- -- --
Income taxes....................... (2,982) (3,873) (2,680) (369) (2,168)
Extraordinary items................ -- -- (830) (830) --
Net (loss)/income.................. $ 2,728 $ 4,022 $(36,383) $(20,106) $(23,688)
======== ======== ======== ======== ========
OTHER OPERATING DATA:
EBITDA(2).......................... $ 15,608 $ 19,347 $ 35,350 $ 14,956 $ 17,706
======== ======== ======== ======== ========

AS A PERCENTAGE OF SALES:
Sales.............................. 100.0% 100.0% 100.0% 100.0% 100.0%
Gross profit....................... 62.2 62.8 71.5 70.3 73.3
Selling, general and administrative
expense.......................... (43.8) (43.6) (52.4) (53.0) (56.8)
Amortization of intangibles and
depreciation..................... (9.0) (11.4) (27.7) (27.1) (34.6)
Non-recurring integration and
restructuring costs.............. -- -- (7.4) (10.6) --
Operating (loss)/income............ 9.4 7.8 (16.1) (20.4) (18.1)
Net interest (expense)/income...... (2.3) 1.2 (1.6) (1.5) (1.7)
Net exchange losses................ (.4) (.2) (.1) (.1) (.3)
Legal settlement................... -- (1.0) -- -- --
Income taxes....................... (3.5) (3.8) (1.4) (.4) (2.0)
Extraordinary items................ -- -- (.4) (1.0) --
Net (loss)/income.................. 3.2% 4.0% (19.7)% (23.4)% (22.1)%
======== ======== ======== ======== ========
OTHER OPERATING DATA:
EBITDA(2).......................... 18.4% 19.2% 19.1% 17.4% 16.5%
======== ======== ======== ======== ========
</TABLE>

- -------------------------
(1) We report in U.S. dollars. Getty Communications plc previously reported in
United Kingdom pounds sterling until December 31, 1996. To facilitate the
comparison of our results with the historical results of Getty
Communications plc and Tony Stone Images, the historical results of Getty
Communications plc have been translated into U.S. dollars using Noon Buying
Rates for pounds sterling expressed in U.S. dollars per pound sterling. The
period end rate at December 31, 1996 was 1.7113 and the average rate for the
twelve-month period ended December 31, 1996 was 1.5606.

(2) EBITDA is defined as earnings before interest, taxes, exchange
gains/(losses), depreciation, amortization, non-recurring integration and
restructuring costs, legal settlement and extraordinary items. EBITDA should
not be considered as an alternative to operating income as an indicator of
our operating performance or to cash flows as a measure of our liquidity.

31
<PAGE> 33

SIX MONTHS ENDED JUNE 30, 1998 AND 1999

Sales

Our total sales increased from $86.1 million in the six months ended June
30, 1998 to $107.1 million for the six months ended June 30, 1999, an increase
of 24.5%. This increase was largely attributable to the continued growth of our
business-to-business brands, particularly the growth of revenues from our
e-commerce websites.

We experienced an increase in the rate of demand for both analog and
digital search, selection and fulfillment of imagery during the six months ended
June 30, 1999, particularly in North America. Digital sales accounted for 27.8%
of our sales or $23.9 million in the six months ended June 30, 1998 and
increased to 41.5% of our sales or $44.5 million in the six months ended June
30, 1999, representing an 86.1% growth. These increases were due, in part, to
the inclusion of Allsport's and PhotoDisc's digital sales for the full six
months in 1999.

E-commerce sales accounted for $11.5 million of sales during the six months
ended June 30, 1998 and more than doubled to $24.1 million, or 22.5% of sales,
in the six months ended June 30, 1999.

Gross Profit

Our gross profit margin was 70.3% for the six months ended June 30, 1998,
and increased to 73.3% in the six months ended June 30, 1999. This result
reflects the increasing shift in sales mix to e-commerce with its lower cost of
sales, as well as continuing changes in our sales mix at the brand level.

Operating Expenses

Selling, General and Administrative Expenses. Selling, general and
administrative expenses were 53.0% of sales in the six months ended June 30,
1998, or $45.6 million, compared to 56.8% of sales, or $60.8 million, for the
six months ended June 30, 1999. The increase in selling, general and
administrative expenses over the same period in 1998 was largely attributable to
accelerated investment in advertising and marketing costs associated with our
new websites, increased investment in management and new sales offices, and the
development of new products and business systems. The acquisition of Art.com,
our consumer business, contributed to the increase in selling, general and
administrative expenses. We intend to continue to make the necessary investments
required to migrate our business from an analog to a digital platform.

We are committed to managing selling, general and administrative expenses
as we further integrate our businesses, and implement new and standardized
business systems. As customers move towards digital image search, retrieval and
payment, we plan to streamline our support operations. We also intend to
consolidate our offices and other premises throughout the world in line with the
recently announced reorganization of our business into four divisions.

Amortization of Intangibles and Depreciation. Amortization of intangibles
increased from $16.9 million in the six months ended June 30, 1998 to $27.0
million in the six months ended June 30, 1999, an increase of 59.9%. This
increase was attributable to increased goodwill that arose from the acquisitions
of PhotoDisc and Allsport in February 1998 and Art.com in May 1999.

Depreciation increased from $6.4 million in the six months ended June 30,
1998 to $10.1 million in the six months ended June 30, 1999, an increase of
56.1%. The increase primarily arose from the acquisitions of PhotoDisc and
Allsport in February 1998, together with increased capital expenditures related
to the development of our digital strategy. We expect depreciation to increase
in the second half of 1999 as a result of this increased investment.

32
<PAGE> 34

Net Exchange Losses. Our operating results are affected by exchange rate
fluctuations to the extent that we have receivables or payables that are
denominated in a currency other than the local currency. Exchange gains or
losses arising on the translation of these balances into local currency or on
the settlement of these transactions are recognized in our income statement.

Our policy is to hedge a majority of our contracted net receivables and
payables using a combination of foreign forward exchange contracts and foreign
currency term loans. Net exchange losses were $371,000 in the six months ended
June 30, 1999 and $59,000 in the same period of 1998.

Income Taxes

The tax charge for the six months ended June 30, 1998 was $369,000 compared
to a tax charge of $2.2 million in the six months ended June 30, 1999. Excluding
the effect of the amortization of intangibles, we have accrued tax at an
effective rate of tax for the six months ended June 30, 1998 of 36.1%, after
allowing for a tax credit of $2.2 million arising from the non-recurring
integration and restructuring costs in 1998. This compares to 39.4% for the same
period in 1999.

EBITDA

EBITDA increased from $15.0 million in the six months ended June 30, 1998
to $17.7 million in the six months ended June 30, 1999, an increase of 18.4%.
For the six months ended June 30, 1998, EBITDA, as a percentage of sales, was
17.4%, and, excluding Art.com, increased to 19.1% for the same period in 1999.
As with gross profit margin, our EBITDA has been impacted by the growth in
digital sales, the increasing sales mix of wholly-owned imagery, as well as
operating efficiencies.

YEARS ENDED DECEMBER 31, 1996, 1997 AND 1998

Sales

Our total sales for the years ended December 31, 1996, 1997, and 1998 were
$85.0 million, $100.8 million and $185.1 million, respectively, representing
increases of 18.6% in 1997 and 83.6% in 1998 over the respective prior year.
These increases were primarily due to growth in our base businesses, the
acquisitions of PhotoDisc and Allsport and growth in digital sales. Digital
sales of $59.0 million in 1998 represented 31.9% of our total sales, an increase
of 37.5% over 1997, compared to an 8.6% growth in our analog sales over the same
period.

Gross Profit

Our gross profit has increased as a percentage of sales from 62.2% in 1996
and 62.8% in 1997 to 71.5% in 1998. These improvements were largely attributable
to changes in the sales mix between brands, increased digital sales, lower cost
of sales for Allsport and PhotoDisc, which were acquired in 1998, a greater
proportion of wholly owned imagery sold or licensed during 1998, and operating
and process improvements.

Operating Expenses

Selling, General and Administrative Expenses. Selling, general and
administrative expenses were $37.3 million, $43.9 million and $96.9 million in
1996, 1997 and 1998, respectively, representing 43.8%, 43.6% and 52.4% of sales
in each respective year. The principal factors contributing to increases in the
dollar amounts of selling, general and administrative expenses during 1997 and
1998 were the inclusion of Allsport and PhotoDisc in our consolidated financial

33
<PAGE> 35

results from February 1998, as well as increased investment in management and
new business systems, particularly those related to e-commerce.

Amortization of Intangibles and Depreciation. Amortization of intangibles
was $2.2 million in 1996, compared to $3.3 million in 1997 and $37.0 million in
1998. The increase in amortization arose from the inclusion of amortization of
goodwill relating to the acquisitions of PhotoDisc and Allsport in February
1998.

Depreciation increased from $5.5 million in 1996 to $8.2 million in 1997
and $14.4 million in 1998. The increase primarily arose from acquisitions,
together with increased investment in capital expenditure related to the
continued development of our digital strategy.

Non-Recurring Integration and Restructuring Costs. Following the
acquisitions of PhotoDisc and Allsport in February 1998, we commenced a program
to integrate our businesses. This resulted in integration and restructuring
charges totaling $13.8 million. There were no such charges in 1996 or 1997.

Net Exchange Losses. Net exchange losses were $306,000 in 1996, $198,000 in
1997 and $124,000 in 1998.

Legal Settlement. We entered into a settlement agreement with Digital Stock
Corporation over a complaint filed in 1997. This resulted in a one-time charge
to 1997 earnings of approximately $1.0 million (including legal expenses).

Income Taxes

Our 1996 tax charge was $3.0 million compared with $3.9 million in 1997 and
$2.7 million in 1998. Excluding the effect of the amortization of intangibles,
which is largely non-tax deductible, we had an effective tax rate of 37.9% in
1996, as compared to 34.7% in 1997 and 38.0% in 1998.

The changes in the effective rate of tax, excluding the impact of the
amortization of intangibles, are due to variations in the profit mix and tax
rates in the countries in which we operate and non-recurring integration and
restructuring costs which are not all fully tax deductible. We expect our
effective tax rate in 1999 to increase to approximately 40.0%.

Extraordinary Items

The repayment of the term debt due to Midland Bank plc from the proceeds of
the $75.0 million, 4.75% convertible subordinated notes resulted in an
extraordinary charge of $830,000 for the year ended December 31, 1998. This
charge comprised the write-off of unamortized loan arrangement costs net of the
associated income tax benefit.

EBITDA

EBITDA for 1996, 1997 and 1998 was $15.6 million, $19.3 million and $35.4
million, respectively, representing increases of 24.0% in 1997 and 82.7% in 1998
over the respective prior years. The growth in EBITDA in 1998 was primarily
attributable to incremental EBITDA from our acquired businesses as well as gross
margin improvement in our base business. Currency movements did not have a
material impact on 1998 EBITDA.

34
<PAGE> 36

QUARTERLY RESULTS OF OPERATIONS

The following tables set forth our unaudited consolidated statement of
operations data for each of the six quarters in the period ended June 30, 1999,
as well as that data expressed as a percentage of our total revenues for the
quarters presented. You should read this information in conjunction with our
consolidated financial statements and related notes appearing elsewhere in this
prospectus. We have prepared this unaudited consolidated information on a basis
consistent with our audited consolidated financial statements, and, in the
opinion of management, this information reflects all normal recurring
adjustments that we consider necessary for a fair presentation of our operating
results for the quarters presented. You should not draw any conclusions about
our future operating results from the operating results for any quarter.

<TABLE>
<CAPTION>
THREE MONTHS ENDED
--------------------------------------------------------------------------
MARCH 31, JUNE 30, SEPTEMBER 30, DECEMBER 31, MARCH 31, JUNE 30,
1998 1998 1998 1998 1999 1999
--------- -------- ------------- ------------ --------- --------
(IN THOUSANDS, EXCEPT PERCENTAGES)
<S> <C> <C> <C> <C> <C> <C>
CONSOLIDATED QUARTERLY INCOME STATEMENT:
Sales................................... $ 37,931 $ 48,126 $ 48,975 $ 50,052 $ 52,150 $ 54,957
Gross profit............................ 26,324 34,217 35,411 36,302 38,309 40,193
Selling general and administrative
expenses.............................. (19,748) (25,837) (25,646) (25,672) (28,724) (32,072)
Amortization of intangibles and
depreciation.......................... (9,794) (13,554) (13,802) (14,207) (14,830) (22,252)
Non recurring integration and
restructuring costs................... -- (9,137) (4,618) -- -- --
Operating loss.......................... (3,218) (14,311) (8,655) (3,577) (5,245) (14,131)
Net interest expense.................... (551) (768) (800) (867) (811) (962)
Net exchange gains/(losses)............. (356) 296 (57) (8) (391) 20
Income taxes............................ (1,080) 712 (188) (2,123) (1,435) (733)
Extraordinary items..................... -- (830) -- -- -- --
Net loss................................ $ (5,205) $(14,901) $ (9,700) $ (6,575) $ (7,882) $(15,806)
======== ======== ======== ======== ======== ========
OTHER OPERATING DATA
EBITDA(1)............................... $ 6,576 $ 8,380 $ 9,765 $ 10,630 $ 9,585 $ 8,121
======== ======== ======== ======== ======== ========
AS A PERCENTAGE OF SALES:
Sales................................... 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
Gross profit............................ 69.4 71.1 72.3 72.5 73.5 73.1
Selling general and administrative
expenses.............................. (52.1) (53.7) (52.4) (51.3) (55.1) (58.4)
Amortization of intangibles and
depreciation.......................... (25.8) (28.2) (28.2) (28.4) (28.4) (40.5)
Non recurring integration and
restructuring costs................... -- (19.0) (9.4) -- -- --
Operating loss.......................... (8.5) (29.7) (17.7) (7.1) (10.1) (25.7)
Net interest expense.................... (1.5) (1.6) (1.6) (1.7) (1.6) (1.8)
Net exchange gains/(losses)............. (.9) .6 (.1) -- (.7) --
Income taxes............................ (2.8) 1.5 (.4) (4.2) (2.8) (1.3)
Extraordinary items..................... -- (1.7) -- -- -- --
Net loss................................ (13.7)% (31.0)% (19.8)% (13.1)% (15.1)% (28.8)%
======== ======== ======== ======== ======== ========
OTHER OPERATING DATA:
EBITDA(1)............................... 17.3% 17.4% 19.9% 21.2% 18.4% 14.8%
======== ======== ======== ======== ======== ========
</TABLE>

- ---------------
(1) EBITDA is defined as earnings before interest, taxes, exchange
gains/(losses), depreciation, amortization, non-recurring integration and
restructuring costs, legal settlement and extraordinary items.

35
<PAGE> 37

SIX QUARTERS ENDED JUNE 30, 1999

Sales

Our total sales revenues increased sequentially in each of the six
quarterly periods ended June 30, 1999. The significant increase in revenues in
the quarterly period ended June 1998 largely reflected the acquisitions of
Allsport and PhotoDisc in February 1998.

Digital sales increased significantly in the first and second quarters of
1999. Digital sales as a percentage of total sales were 40.2% and 42.8% for the
quarters ended March 31, 1999 and June 30, 1999, respectively. This compared to
22.7% and 31.2% for the corresponding periods in 1998. E-commerce sales for the
quarter ended March 31, 1999 more than doubled over the quarter ended March
31,1998 to $10.3 million. This trend continued with e-commerce sales reaching
$13.8 million for the quarter ended June 30, 1999, an increase of 115.3% over
the corresponding period in 1998. The launch of the Tony Stone Images website in
the fourth quarter of 1998, contributed significantly to this e-commerce sales
growth, particularly in North America.

Gross Profit

Gross profit increased sequentially in each of the six quarterly periods
ended June 30, 1999. Gross profit as a percentage of sales, or gross margin,
increased in each of the five quarterly periods ended March 31, 1999. The
increase in gross margin in June 1998 against the prior quarter primarily
resulted from the acquisitions of PhotoDisc and Allsport. The slight decrease in
the gross margin in the quarter ended June 30, 1999, as compared to the
preceding quarter, reflected the acquisition of Art.com in May 1999. Excluding
Art.com, the gross margin for the second quarter of 1999 would have reflected a
slight increase over the first quarter of 1999. The improvement in gross margin,
excluding Art.com, over the six quarterly periods reflects the increasing shift
in sales mix to e-commerce with its lower cost of sales, as well as continuing
changes in our sales mix at the brand level.

Operating Expenses

Selling, General and Administrative Expenses. Selling, general and
administrative expenses have increased in each of the last six quarters with the
exception of the third quarter of 1998. As a percentage of sales, selling,
general and administrative expenses have fluctuated across the six periods. The
increase in the dollar amount of such expenses in the second quarter of 1998
resulted from the acquisitions of PhotoDisc and Allsport in February 1998.
Selling, general and administrative expenses increased from the first to the
second quarter of 1999, mainly due to accelerated investment in advertising and
marketing costs associated with the new websites as well as increased investment
in management, new sales offices, the development of new technology products and
business systems. As a percentage of sales, selling, general and administration
costs increased from 55.1% in the first quarter of 1999 to 58.4% in the second
quarter of 1999. This increase was primarily attributable to the acquisition of
Art.com in May 1999.

Amortization of Intangibles and Depreciation. The increase in amortization
and depreciation expenses in the second quarter of 1998 from the previous
quarter relates to the acquisition of PhotoDisc and Allsport. The increase in
the quarterly period ended June 30, 1999 is attributable to the acquisition of
Art.com in May 1999.

Non-Recurring Integration and Restructuring Costs. We implemented a program
to integrate our businesses following the acquisitions of PhotoDisc and Allsport
in February 1998. This resulted in integration and restructuring charges
totalling $13.8 million in the second and third quarters of 1998. The charges
included restructuring costs, severance costs, consulting and professional fees,
systems and process integration costs, and costs associated with contract
renegotiations and terminations.
36
<PAGE> 38

EBITDA

EBITDA increased sequentially in each quarterly period during 1998. The
growth in the second quarter of 1998 over the first quarter of 1998 was largely
due to the acquisitions of PhotoDisc and Allsport in February 1998. EBITDA in
the first quarter of 1999 decreased from the fourth quarter of 1998 largely as a
result of an increase in selling, general and administration expenses. The
decrease in EBITDA in the second quarter of 1999 was due to the acquisition of
Art.com in May 1999.

LIQUIDITY AND CAPITAL RESOURCES

<TABLE>
<CAPTION>
GETTY
COMMUNICATIONS PLC GETTY IMAGES, INC.
------------------- ----------------------------------
YEAR ENDED YEAR ENDED SIX MONTHS ENDED
DECEMBER 31, DECEMBER 31, JUNE 30,
1996 1997 1998 1998 1999
-------- -------- ------------ -------- --------
(UNAUDITED)
(IN THOUSANDS)
<S> <C> <C> <C> <C> <C>
Net cash provided by/(used in):
Operating activities.......... $ 13,502 $ 13,174 $ 7,222 $ 5,220 $ 2,689
Investing activities.......... (25,528) (35,447) (107,869) (83,667) (17,455)
Financing activities.......... 66,311 (3,052) 85,003 84,953 16,387
Exchange differences.......... 2,755 (4,380) 2,560 423 (3,377)
-------- -------- --------- -------- --------
Net increase/(decrease) in cash
and cash equivalents.......... $ 57,040 $(29,705) $ (13,084) $ 6,929 $ (1,756)
======== ======== ========= ======== ========
</TABLE>

Net cash provided by operating activities amounted to $2.7 million in the
six months ended June 30, 1999, compared to $5.2 million in the six months ended
June 30, 1998. The decrease is due to increased spending on marketing and
advertising, particularly at Art.com, as well as the production of new
contemporary stock photography catalogs. Net cash provided by operating
activities amounted to $7.2 million in 1998 compared to $13.2 million in 1997
and $13.5 million in 1996. The decrease in cash generated from operations in
1998 was principally a result of payments of non-recurring integration and
restructuring costs related to our acquisition of PhotoDisc and Allsport in
February 1998 and the acquisition of other businesses throughout the year.

Net cash used in investing activities in the six months ended June 30, 1999
was $17.5 million, compared to $83.7 million in the same period in 1998. Net
cash used in investing activities was $107.9 million in 1998 as compared to
$35.4 million in 1997 and $25.5 million in 1996. The six month and yearly cash
flows primarily reflect the business acquisitions made in each period, in
addition to increased investment in technology and related infrastructure.
During 1998, we invested $27.3 million in fixed assets compared to $14.9 million
in 1997 and $7.2 million in 1996. Capital expenditure was $17.9 million for the
six months ended June 30, 1999.

Net cash provided by financing activities in the six months ended June 30,
1999 was $16.4 million, primarily as a result of a $15.0 million short-term
revolving credit facility we obtained in April 1999 to fund additional working
capital requirements and the acquisition of Art.com.

The acquisitions of PhotoDisc and Allsport in February 1998 and other
businesses throughout the year resulted in a net cash outflow of $80.6 million,
including expenses. To fund this amount, we raised a net additional $47.2
million of debt and Getty Investments LLC subscribed for an additional 1,500,000
shares, providing $28.0 million of additional capital. We also received an
additional $5.3 million in connection with the exercise of stock options.

37
<PAGE> 39

On May 20, 1998, we raised $75.0 million from the issuance of our
convertible subordinated notes. Of these proceeds, $49.0 million was applied to
the repayment of term debt and $3.3 million to debt issuance costs. Also, in the
year ended December 31, 1998, we raised $5.3 million from the exercise of
options. At December 31, 1998, we had outstanding long term debt of $75.0
million and cash of $16.2 million.

THE EURO CONVERSION

A new European currency, the Euro, was implemented in January 1999 to
replace the separate currencies of eleven Western European countries. This is
requiring changes in our operations as we modify systems and commercial
arrangements to handle the new currency. Modifications are necessary in
operations such as payroll, benefits and pension systems, contracts with
suppliers and customers and internal financial reporting systems. Although a
three-year transition period is expected during which transactions may also be
made in the old currency, we will use dual currency processes for our operations
during the transition period. We have identified the issues involved and are
developing and implementing solutions. We do not expect the cost of this effort
to have a material effect on our business or results of operations, however we
cannot be sure that all problems will be foreseen and corrected or that no
material disruption of our business will occur.

YEAR 2000 READINESS

The Year 2000 issue refers to the risk that systems, products and equipment
having date-sensitive components will not recognize the Year 2000 as a result of
computer programs using two digits rather than four to define the applicable
year. The use of noncompliant Year 2000 programs or our inability to update our
systems successfully may result in system failures, miscalculations or errors
which could cause disruption of operations, the corruption of data or other
business problems, including, among other things, a temporary inability to
process transactions and invoices, or engage in other business activities. In
addition to our computer systems, the Year 2000 issue may affect certain
embedded systems such as alarms, gates and time locks, lighting, security,
electrical supply control and backup equipment, and communication systems such
as switchboards, fax machines and cellular telephones.

In addition to Year 2000 issues related to our systems, we may be adversely
affected if our key suppliers or other material third party service providers
are unable or fail to adequately address the Year 2000 issue. Such suppliers can
include infrastructure suppliers in areas such as utilities, communications,
transportation and other services. While we are developing alternate power
generation sources for our most sensitive systems, the likelihood and effects of
failures in infrastructure systems and in the supply chain cannot be estimated.

We developed the Year 2000 Compliance Program (the "Program") to identify
and mitigate Year 2000 issues in our information systems, facilities and
suppliers. The Program can be divided into three phases: (1) evaluation, which
includes identifying issues, taking an inventory of the systems affected and
developing solutions to address the issues; (2) implementation, which includes
deploying program and software changes and completing necessary contingency
plans; and (3) testing, which includes performing applications and acceptance
testing and certification.

The goals of the Program are to ensure that we and our business divisions
can continue to function at optimal levels up to and beyond December 31, 1999,
to provide our customers and

38
<PAGE> 40

partners with our services throughout the affected period and to ensure that key
suppliers are Year 2000 compliant and that there will be no disruption in our
supply of services and products.

Our Chief Executive Officer, subject to our board of directors' oversight,
is responsible for the overall implementation of the Program and ensuring that
we become Year 2000 compliant by December 31, 1999.

As of June 30, 1999, we had completed phase one of the Program and had
completed the majority of phases two and three. We expect that the bulk of our
systems will be Year 2000 compliant by the end of the third quarter of 1999,
with the remainder reaching compliance during the fourth quarter of 1999.
Contingency plans have been developed for any matter not resolved in 1999 that
may have a material negative impact on our final Year 2000 readiness.

Evaluation. We have inventoried all of our major hardware and software
platforms, as well as the relevant computer, embedded and communication systems,
which may be affected by the Year 2000 issue and assessed our needs to become
Year 2000 compliant. We have completed a review of the Year 2000 issues faced by
our material suppliers and evaluated the risks and dependencies associated with
those suppliers. The review of the Year 2000 issues faced by licensees and
agents has been completed.

Implementation. We are in the advanced stages of our deployment of software
and hardware changes. Year 2000 compliance measures have been incorporated into
all new Internet initiatives, becoming our standard for all new contracts and
have been incorporated into our due diligence program when evaluating potential
acquisitions and partnerships.

In addition, we have developed our first stage contingency plan which
addresses the identification of alternative suppliers and distribution channels
and the implementation of manual systems if it becomes necessary. We are
continuing to review this process.

Testing. We will continue testing our computer, embedded and communication
systems as we complete the implementation of software and hardware changes.

We estimate that the expected total aggregate costs for our Year 2000
activities and related systems changes will be approximately $2.5 million, of
which approximately $2.2 million has been spent as of June 30, 1999.

RISKS RELATED TO THE YEAR 2000 ISSUE

Although our efforts to be Year 2000 compliant are intended to minimize the
adverse effects of the Year 2000 issues on our operations and business, the
actual effects of the Year 2000 issue will not be known until 2000. If we or our
material suppliers fail to become Year 2000 compliant in a timely manner, Year
2000 issues could have a material adverse effect on our business, results of
operations and financial condition. Our capital requirements may differ
materially from the foregoing estimate as a result of regulatory, technological
and competitive developments in our industry.

The Year 2000 disclosure set forth above is intended to be a "Year 2000
statement" as such term is defined in the Year 2000 Information and Readiness
Disclosure Act of 1998 (the "Year 2000 Act") and, to the extent such disclosure
relates to our Year 2000 processing or to products or services we offer, is
intended to be a "Year 2000 readiness disclosure" as such term is defined in the
Year 2000 Act.

39
<PAGE> 41

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We are exposed to a variety of risks, including changes in interest rates
affecting the return on our investments and foreign currency fluctuations. In
the normal course of business, we employ established policies and procedures to
manage our exposure to fluctuations in interest rates and foreign currency
values.

INTEREST RATE RISK

Our exposure to market rate risk for changes in interest rates relates
primarily to our debt instruments, most of which are fixed rate borrowings.

<TABLE>
<CAPTION>
FAIR VALUE
MATURITIES ----------
----------------------------------------- JUNE 30,
DEBT (INCLUDING CURRENT PORTION) 1999 2000 2003 TOTAL 1999
- -------------------------------- ------- -------- ------- ------- ----------
(IN THOUSANDS, EXCEPT PERCENTAGES)
<S> <C> <C> <C> <C> <C>
Fixed rate.................... $75,000 $75,000 $75,000
Average interest rate......... 4.75%
Other borrowings.............. $15,333 $15,333 $15,333
Average interest rate......... 6.30%
</TABLE>

FOREIGN CURRENCY RISK

We conduct our business primarily in the United States and the United
Kingdom and, therefore, our cashflows are primarily denominated in U.S. dollars
and United Kingdom pounds sterling. We are exposed to foreign exchange risk
related to foreign currency denominated assets and liabilities and cash. The
introduction of the euro does not significantly affect our foreign exchange
exposure.

Our functional currency is U.S. dollars. We have entered into forward
foreign currency exchange contracts to hedge our contracted net receivables
denominated in foreign currencies. The forward foreign currency exchange
contracts typically have a term of less than six months. All forward foreign
currency exchange contracts at June 30, 1999 were designated and accounted for
as hedges.

The criteria we use for designating a contract as a hedge include the
contract's effectiveness in risk reduction. Gains and losses on these contracts,
relating to the hedged risk, are recognized as incurred, reflecting the income
statement treatment of the hedge items.

If an underlying hedged transaction is terminated earlier than initially
anticipated, the offsetting gain or loss on the related forward foreign exchange
contract would be recognized in income in the same period. In addition, since we
enter into forward contracts only as hedges, any change in currency rates would
not result in any material gain or loss, as any gain or loss on the underlying
foreign currency denominated balances would be offset by the loss or gain on the
forward contract.

40
<PAGE> 42

The following table presents certain information regarding our use of
financial instruments.

<TABLE>
<CAPTION>
MATURITIES FAIR VALUE
-------------------------- U.S. DOLLAR
U.S. DOLLAR EQUIVALENT
CONTRACT TYPE 1999 EQUIVALENT JUNE 30, 1999
------------- ---------- ------------ --------------
(CURRENCY AND U.S. DOLLAR EQUIVALENTS IN
THOUSANDS EXCEPT AVERAGE CONTRACTUAL
EXCHANGE RATE WHICH IS TO THE NEAREST SECOND
DECIMAL POINT)
<S> <C> <C> <C>
Buy Pound Sterling/sell French Franc......... 7,200 $1,178 $(20)
Average contractual exchange rate (French
Franc/ Pound Sterling)..................... 9.80
Buy Pound Sterling/sell Deutsche mark........ 3,700 $2,005 $ (9)
Average contractual exchange rate (Deutsche
mark/Pound Sterling)....................... 2.96
Buy Pound Sterling/sell Italian Lire......... 1,050,000 $ 591 $(18)
Average contractual exchange rate (Italian
Lire/ Pound Sterling)...................... 2,850.16
Buy Pound Sterling/sell Japanese yen......... 24,000 $ 201 $ 2
Average contractual exchange rate (Japanese
Yen/ Pound Sterling)....................... 191.44
Buy Pound Sterling/sell Spanish Peseta....... 65,000 $ 422 $ (9)
Average contractual exchange rate (Spanish
Peseta/Pound Sterling)..................... 246.84
</TABLE>

There are further forward foreign currency exchange contracts at June 30,
1999 that are together considered immaterial. The U.S. dollar equivalent
maturity value of these contracts is $513,000. All foreign exchange risk
contracts are foreign currency forward exchange contracts between the indicated
currency and the United Kingdom pound sterling.

Forward foreign exchange contracts between United Kingdom pound sterling
and Deutsche mark, French franc, Italian lire, Spanish peseta and Japanese yen
account for 41.0%, 24.0%, 12.0%, 9.0% and 4.0%, respectively, of our total U.S.
dollar equivalents in forward foreign exchange contracts.

41
<PAGE> 43

SELECTED CONSOLIDATED FINANCIAL DATA OF THE IMAGE BANK

The following selected consolidated financial data is qualified by
reference to, and should be read in conjunction with, The Image Bank's
consolidated financial statements and notes thereto and the section entitled
"Management's Discussion and Analysis of Financial Condition and Results of
Operations of The Image Bank." The statement of operations data and cash flow
data for the year ended December 31, 1998 and the balance sheet data for the
year ended December 31, 1998 are derived from the consolidated financial
statements which have been audited by PricewaterhouseCoopers LLP, independent
auditors. Interim statement of operations data and cash flow data for the
periods ended June 30, 1998 and June 30, 1999 are derived from unaudited
financial statements which, in the opinion of management, reflect all
adjustments necessary for a fair presentation of that data. Historical results
are not indicative of the results to be expected in the future.

<TABLE>
<CAPTION>
THE IMAGE BANK, INC.
-------------------------------------------------
SIX MONTHS ENDED
YEAR ENDED -----------------------------
DECEMBER 31, 1998 JUNE 30, 1998 JUNE 30, 1999
----------------- ------------- -------------
(IN THOUSANDS)
<S> <C> <C> <C>
STATEMENT OF OPERATIONS DATA:
Sales....................................... $70,833 $35,357 $38,081
Cost of sales............................... 29,624 14,418 15,197
------- ------- -------
Gross profit................................ 41,209 20,939 22,884
Selling, general and administrative
expenses.................................. 33,791 17,628 19,814
Depreciation and amortization of
intangibles............................... 8,919 4,053 4,960
------- ------- -------
Operating loss.............................. (1,502) (742) (1,890)
Net interest expense........................ (286) (122) (85)
Miscellaneous income........................ 325 58 151
Net exchange gains/(losses)................. 65 (31) (485)
------- ------- -------
Loss before income taxes.................... (1,397) (837) (2,309)
Provision for income taxes.................. (1,954) (1,104) (688)
------- ------- -------
Net loss.................................... $(3,351) $(1,941) $(2,997)
======= ======= =======
CASHFLOW DATA:
Net cash provided by/(used in):
Operating activities........................ $ 5,276 $ 2,590 $ (930)
Investing activities........................ (17,213) (2,817) (5,052)
Financing activities........................ 13,001 548 6,306
------- ------- -------
Net increase in cash and cash equivalents... $ 1,064 $ 321 $ 324
======= ======= =======
BALANCE SHEET DATA:
Cash and cash equivalents................... $ 1,875 $ 1,132 $ 2,198
Total assets................................ 87,861 77,206 96,735
Long-term debt, net of current maturities... 48,986 36,182 56,274
Total stockholders' equity.................. $21,300 $22,640 $18,518
======= ======= =======
</TABLE>

42
<PAGE> 44

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS OF THE IMAGE BANK

The following should be read in conjunction with the "Selected Consolidated
Financial Data of The Image Bank" and the other financial information about The
Image Bank contained elsewhere in this prospectus. All financial data referred
to in the following discussion has been prepared in accordance with United
States Generally Accepted Accounting Principles (U.S. GAAP).

In addition to historical information, the discussion in this section may
contain certain forward-looking statements that involve risks and uncertainties.
The forward-looking statements relate to, among other things, operating results,
gross margins and anticipated liquidity and capital resources. Actual results
could differ materially from those anticipated by these forward-looking
statements due to factors including, but not limited to, those set forth under
the section entitled "Risk Factors," and elsewhere in this prospectus.

OVERVIEW

The Image Bank was founded in 1974 and was acquired by the Eastman Kodak
Company in 1991. The Image Bank is a leading provider of contemporary and
archival stock photography, film footage and illustrations. The Image Bank
licenses its images and footage primarily to advertising agencies, publishing
agencies, publishing companies, production companies and graphic art firms. We
believe that The Image Bank has more than 30 million photographs, more than
15,000 hours of film footage and approximately 100,000 illustrations.

The Image Bank consists of the The Image Bank stock photography and stock
footage businesses, Archive Photos and Archive Film, Swanstock and Artville. The
Image Bank markets contemporary still images and film footage. Archive Film has
collections of both archival still images and film footage. Swanstock
specializes in museum quality photographic fine art images. In October 1998, The
Image Bank acquired Artville, one of the leading sources for illustrations.

The Image Bank's sales are primarily derived from the marketing of image
reproduction and broadcasting rights to a range of business-to-business
customers. Sales generally consist of a large number of relatively small
transactions involving the sale either of single images, video and film clips or
of CD ROM products containing between 100 and 300 images. The Image Bank
principally uses analog distribution platforms together with some digital
distribution through CD ROMs. Price is generally determined by the extent of
rights granted over the use of the image or clip and can vary significantly
across geographic markets and customer groups. The Image Bank also charges photo
service and film service fees for customization, research and delivery.

Sales are recognized when a license agreement has been completed with the
customer for the use of the image and the image has been made available to the
customer for use. Pricing terms do not call for additional fees beyond the fixed
license amount. The customer is contractually obligated to pay the fixed license
amount upon agreement of the license terms and availability of the image for use
by the customer. In the case of royalty-free sales, revenue is recognized upon
the shipment of the CD ROM. There is no one single customer which accounts for
more than 10.0% of The Image Bank's total sales.

The Image Bank's cost of sales primarily consists of commission payments to
contributing photographers and cinematographers. The Image Bank has contracts
with these suppliers to provide stock photography and cinematography to The
Image Bank for commissions of up to 50.0% depending on the product sold and the
location of the sale. Images owned by The Image Bank or which are in the public
domain do not require commission payments. Cost of sales also includes, to the
extent applicable, handling and shipping costs for duplicate transparencies and
the cost of CD ROM production. As a result, The Image Bank's overall gross
profit margin is

43
<PAGE> 45

impacted by the sales of wholly-owned imagery, geographic distribution of sales
and brand sales mix.

The Image Bank's selling, general and administrative expenses include
salaries and related staff costs, premises and utility costs, and sales and
marketing costs.

The Image Bank amortizes goodwill and depreciates the cost of the
investment in its libraries (including any costs of duplication) and other fixed
assets over their expected useful lives. The acquisitions of Archive, Swanstock
and Artville generated approximately $32.0 million of goodwill that is being
amortized over ten to fifteen years. We intend to amortize this goodwill over a
period of ten years in line with our amortization of goodwill of The Image Bank.

The analysis in this "Management's Discussion and Analysis of Financial
Condition and Results of Operations of The Image Bank" comprises a comparison of
the six months ended June 30, 1999 with the six months ended June 30, 1998. No
comparison of the year ended December 31, 1998 with the year ended December 31,
1997 has been included because The Image Bank did not prepare audited accounts
for the year ended December 31, 1997.

RESULTS OF OPERATIONS

SIX MONTHS ENDED JUNE 30, 1999 AND 1998

Sales

Sales for the first six months of 1999 increased 7.7% to $38.1 million from
$35.4 million for the first six months of 1998. These increases were primarily
attributable to the inclusion in 1999 of revenue from Artville which was
acquired in October 1998, as well as continued growth in film sales. This
increase was partially offset by a decrease in The Image Bank's stock
photography revenues, which was largely due to foreign currency translation
losses.

Gross Profit

Gross profit for the first six months of 1999 increased by 9.3% to $22.9
million from $20.9 million for the first six months of 1998. Gross margin was
60.1% in the first six months of 1999 compared to 59.2% in the first six months
of 1998. The increase in absolute dollars and percentage was largely
attributable to the acquisition of Artville and growth in film sales.

Operating Expenses

Selling, General and Administrative Expenses. Selling, general and
administrative expenses for the first six months of 1999 increased 12.4% to
$19.8 million from $17.6 million for the first six months of 1998. The increase
was primarily attributable to an increase in headcount to support the increased
revenues and assist The Image Bank in addressing Year 2000 compliance. In
addition, The Image Bank also produced substantially more catalogs during the
first six months of 1999 as compared to the first six months of 1998 and
Artville's selling, general and administrative costs were included in 1999 but
not in 1998 due to the timing of its acquisition in the last half of 1998.

Amortization of Intangibles and Depreciation. Depreciation and amortization
of intangibles for the first six months of 1999 increased to $5.0 million from
$4.1 million in the first six months of 1998. The increase in 1999 amortization
was related to the acquisition of Artville in October 1998, which resulted in
approximately $7.9 million of goodwill. Depreciation increased due to The Image
Bank's investment in developing its e-commerce business as well as the inclusion
of assets acquired in the Artville acquisition in the 1999 period.

44
<PAGE> 46

EBITDA

EBITDA for The Image Bank represents gross profit less selling, general and
administrative expenses. EBITDA for the first six months of 1999 was $3.1
million compared to $3.3 million in the first six months of 1998. The decrease
was attributable to the increase in selling, general and administrative expenses
in the first six months of 1999. As a percentage of sales, EBITDA was 8.1% in
the first six months of 1999 compared to 9.4% in the first six months of 1998.

LIQUIDITY AND CAPITAL RESOURCES

Net cash used by operating activities was $930,000 during the first six
months of 1999 as compared to net cash provided by operating activities of $2.6
million during the six months ended June 30, 1998. The operating cash deficit
was primarily due to a higher net loss, partially offset by increased
depreciation and amortization expenses.

During the first six months of 1999, The Image Bank spent $5.1 million in
acquiring fixed assets and libraries, as compared to $2.8 million during the
first six months of 1998. The increased spending was largely attributable to the
digitization of The Image Bank's images and the initiation of the development of
an e-commerce channel. Additionally, financing activities provided The Image
Bank with $6.3 million during the six months ended June 30, 1999. This compared
to $548,000 during the six months ended June 30, 1998. These amounts were
primarily related to the repayment of debt.

45
<PAGE> 47

UNAUDITED CONDENSED PRO FORMA CONSOLIDATED
FINANCIAL INFORMATION

INTRODUCTORY NOTE

The following unaudited condensed pro forma consolidated financial
information (the "Pro Forma Consolidated Financial Information") gives pro forma
effect to the completion of the acquisitions of Art.com and The Image Bank,
after giving effect to the pro forma adjustments described in the accompanying
notes. The Pro Forma Consolidated Financial Information has been prepared from,
and should be read in conjunction with, our audited historical consolidated
financial statements and notes thereto included herein, the audited historical
financial statements of Art.com, which are included in our Quarterly Report on
Form 10-Q/A as filed with the SEC on July 16, 1999 and incorporated by reference
herein, and the audited historical financial statements of The Image Bank
included herein.

The Pro Forma Consolidated Financial Information is provided for
illustrative purposes only and does not purport to represent what actual results
of operations or financial position would have been had the acquisitions of
Art.com and The Image Bank occurred on the respective dates assumed, nor is it
necessarily indicative of our future operating results or consolidated financial
position.

We will account for the acquisitions of Art.com and The Image Bank by the
purchase method of accounting in accordance with U.S. GAAP. Accordingly, the
purchase consideration for acquiring Art.com and The Image Bank will be
allocated to the tangible and intangible assets acquired and the liabilities
assumed, with the excess cost being allocated to goodwill and presented as an
intangible asset. A preliminary allocation of the purchase price of The Image
Bank has been reflected in the Pro Forma Consolidated Financial Information. A
final allocation of the purchase price for The Image Bank is dependent on the
completion of certain valuations and other studies which will not be completed
before the closing of this offering. We believe that once the valuations and
other studies are completed, the resulting allocation of purchase price will not
result in an overall result significantly different from the preliminary
allocation of amortization assumed for the purposes of the Pro Forma
Consolidated Financial Information.

The purchase consideration of The Image Bank is estimated at $189.0
million, including expenses. The stock purchase agreement provides that we will
pay to Eastman Kodak $183.0 million at closing, which for the purposes of this
pro forma is assumed to be satisfied through $133.0 million from this offering
and $50.0 million from long term bank debt, which we are currently negotiating.

46
<PAGE> 48

UNAUDITED CONDENSED PRO FORMA CONSOLIDATED INCOME STATEMENT
YEAR ENDED DECEMBER 31, 1998

The following unaudited condensed pro forma income statement for the year
ended December 31, 1998 is derived from our audited historical consolidated
statements of operations for the year then ended, the audited historical
consolidated statement of operations of The Image Bank for the year then ended
and the audited historical statement of operations of Art.com for the year then
ended, after giving effect to the pro forma adjustments described in the notes
to the Pro Forma Consolidated Financial Information. Such adjustments have been
determined as if the acquisition of Art.com and The Image Bank took place on
January 1, 1998, the first day of the financial period presented in the Pro
Forma Consolidated Financial Information.

<TABLE>
<CAPTION>
PRO
FORMA
GETTY ART.COM, THE IMAGE ADJUSTMENTS ADJUSTMENTS PRO FORMA
IMAGES, INC. INC. BANK (NOTE 1) (NOTE 2) CONSOLIDATED
------------ -------- ---------- ----------- ----------- ------------
(IN THOUSANDS EXCEPT LOSS PER SHARE DATA)
<S> <C> <C> <C> <C> <C> <C>
Sales.................. $185,084 $ 384 $ 70,833 -- -- $ 256,300
Cost of sales.......... (52,830) (285) (29,624) -- -- (82,739)
-------- ------- -------- ------ -------- ---------
GROSS PROFIT........... 132,254 99 41,209 -- -- 173,561
Selling, general and
administrative
expenses............. (96,904) (5,304) (33,791) -- -- (135,999)
Amortization of
intangibles.......... (36,961) (26) (4,228) 1,245 (56,889) (96,859)
Depreciation........... (14,397) (96) (4,691) -- -- (19,184)
Non-recurring
integration and
restructuring costs.. (13,755) -- -- -- -- (13,755)
-------- ------- -------- ------ -------- ---------
OPERATING LOSS......... (29,763) (5,327) (1,502) 1,245 (56,889) (92,236)
Net interest expense... (2,986) (61) (286) -- (3,733) (7,065)
Net exchange
(losses)/gains....... (124) -- 65 -- -- (59)
Other operating
income............... -- -- 325 -- -- 325
-------- ------- -------- ------ -------- ---------
LOSS BEFORE TAXES...... (32,873) (5,388) (1,397) 1,245 (60,622) (99,035)
Income taxes........... (2,680) -- (1,954) -- 1,225 (3,409)
-------- ------- -------- ------ -------- ---------
Loss before
extraordinary
items................ (35,553) (5,388) (3,351) 1,245 (59,397) (102,444)
Extraordinary items.... (830) -- -- -- -- (830)
-------- ------- -------- ------ -------- ---------
NET LOSS............... $(36,383) $(5,388) $ (3,351) $1,245 $(59,397) $(103,274)
======== ======= ======== ====== ======== =========
LOSS PER SHARE:
Basic................ $ (1.25) $
======== =========
AVERAGE NUMBER OF
SHARES OUTSTANDING:
Basic................ 29,160
======== ======== =========
</TABLE>

See accompanying notes to the Pro Forma Consolidated Financial Information on
pages 50 to 53.

47
<PAGE> 49

UNAUDITED CONDENSED PRO FORMA CONSOLIDATED INCOME STATEMENT
SIX MONTHS ENDED JUNE 30, 1999

The following unaudited condensed pro forma income statement for the six
months ended June 30, 1999 is derived from the unaudited historical condensed
consolidated income statement of Getty Images for the six months then ended and
the unaudited historical condensed income statement of Art.com for the period
January 1, 1999 through May 4, 1999 and the unaudited historical condensed
consolidated income statement of The Image Bank for the six months ended June
30, 1999, after giving effect to the adjustments described in the notes to the
Pro Forma Consolidated Financial Information. Such adjustments have been
determined as if the acquisition of Art.com and The Image Bank took place on
January 1, 1998, the first day of the financial period presented in the Pro
Forma Consolidated Financial Information.

<TABLE>
<CAPTION>
PRO FORMA
GETTY IMAGES, THE IMAGE ADJUSTMENTS ADJUSTMENTS PRO FORMA
INC. ART.COM, INC. BANK (NOTE 1) (NOTE 2) CONSOLIDATED
------------- ------------- --------- ----------- ----------- ------------
(IN THOUSANDS EXCEPT LOSS PER SHARE DATA)
<S> <C> <C> <C> <C> <C> <C>
Sales...................... $107,107 $ 552 $ 38,081 -- -- $145,740
Cost of sales.............. (28,605) (602) (15,197) -- -- (44,404)
-------- ------- -------- ---- ------- --------
GROSS PROFIT............... 78,502 (50) 22,884 -- -- 101,336
Selling, general and
administrative
expenses................. (60,796) (4,003) (19,814) -- -- (84,613)
Amortisation of
intangibles.............. (27,021) -- (2,104) 623 (21,655) (50,157)
Depreciation............... (10,061) (225) (2,856) -- -- (13,142)
Non-recurring integration
and restructuring
costs.................... -- -- -- -- -- --
-------- ------- -------- ---- ------- --------
OPERATING LOSS............. (19,376) (4,278) (1,890) 623 (21,655) (46,576)
Net interest
(expense)/income......... (1,773) 51 (85) (1,867) (3,674)
Net exchange losses........ (371) -- (485) -- -- (856)
Other operating income..... -- -- 151 -- -- 151
-------- ------- -------- ---- ------- --------
LOSS BEFORE TAXES.......... (21,520) (4,227) (2,309) 623 (23,522) (50,955)
Income taxes............... (2,168) -- (688) -- 612 (2,244)
-------- ------- -------- ---- ------- --------
NET LOSS................... $(23,688) $(4,227) $ (2,997) $623 $(22,910) $(53,199)
======== ======= ======== ==== ======= ========
LOSS PER SHARE:
Basic.................... $ (.74)
======== ========
AVERAGE NUMBER OF SHARES
OUTSTANDING:
Basic.................... 32,134
======== ======= ========
</TABLE>

See accompanying notes to the Pro Forma Consolidated Financial Information on
pages 50 to 53.

48
<PAGE> 50

UNAUDITED CONDENSED PRO FORMA CONSOLIDATED BALANCE SHEET
AT JUNE 30, 1999

The following unaudited condensed pro forma balance sheet at June 30, 1999
is derived from our unaudited historical consolidated balance sheet at June 30,
1999 and the unaudited historical consolidated balance sheet of The Image Bank
at June 30, 1999, after giving effect to the pro forma adjustments described in
the notes to the Pro Forma Consolidated Financial Information. Such adjustments
have been determined as if the acquisition of The Image Bank took place on June
30, 1999.

<TABLE>
<CAPTION>
PRO FORMA
GETTY IMAGES, THE IMAGE ADJUSTMENTS ADJUSTMENTS PRO FORMA
INC. BANK (NOTE 1) (NOTE 3) CONSOLIDATED
------------- --------- ----------- ----------- ------------
(IN THOUSANDS)
<S> <C> <C> <C> <C> <C>
ASSETS
CURRENT ASSETS
Cash and cash equivalents..... $ 14,394 $ 2,198 $ -- $(14,015) $ 2,577
Accounts receivable, net...... 39,677 27,964 -- -- 67,641
Inventories, net.............. 28,389 -- -- -- 28,389
Prepaid expenses and other
assets...................... 4,573 3,373 -- -- 7,946
-------- ------- -------- -------- --------
TOTAL CURRENT ASSETS.......... 87,033 33,535 -- (14,015) 106,553
Fixed assets, net............. 68,612 20,168 -- -- 88,780
Intangible assets, net........ 421,077 41,302 (14,870) 130,183 577,692
Other long term assets........ -- 1,730 -- -- 1,730
Deferred tax assets........... 4,875 -- -- -- 4,875
-------- ------- -------- -------- --------
TOTAL ASSETS.................. $581,597 $96,735 $(14,870) $116,168 $779,630
======== ======= ======== ======== ========
LIABILITIES AND STOCKHOLDERS'
EQUITY
CURRENT LIABILITIES
Accounts payable.............. $ 31,444 $21,944 $ -- $ -- $ 53,388
Accrued expenses.............. 23,386 -- -- -- 23,386
Income taxes payable.......... 308 -- -- -- 308
Short term borrowings,
including current portion of
long term debt.............. 15,333 -- -- -- 15,333
-------- ------- -------- -------- --------
TOTAL CURRENT LIABILITIES..... 70,471 21,944 -- -- 92,415
Long term debt................ 72,778 56,274 (55,170) 49,300 123,182
-------- ------- -------- -------- --------
TOTAL LIABILITIES............. 143,249 78,218 (55,170) 49,300 215,597
TOTAL STOCKHOLDERS' EQUITY.... 438,348 18,517 40,300 66,868 564,033
-------- ------- -------- -------- --------
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY........ $581,597 $96,735 $(14,870) $116,168 $779,630
======== ======= ======== ======== ========
</TABLE>

See accompanying notes to the Pro Forma Consolidated Financial Information on
pages 50 to 53.

49
<PAGE> 51

NOTES TO THE UNAUDITED PRO FORMA CONSOLIDATED
FINANCIAL INFORMATION

1. ADJUSTMENTS TO HISTORICAL FINANCIAL STATEMENTS

(a) The historical financial statements are presented in U.S. dollars and
prepared in accordance with U.S. GAAP. The following adjustments have been made
to reflect the differences arising from the adoption of Getty Images' accounting
policies in order to align the useful lives of intangible assets and in order to
reflect the impact upon amortization of eliminating goodwill arising from the
acquisition of The Image Bank that was pushed down, or transferred, to the
accounting records of The Image Bank by Eastman Kodak following its acquisition
in 1991:

AMORTIZATION

<TABLE>
<CAPTION>
YEAR ENDED SIX MONTHS
DECEMBER 31, ENDED JUNE 30,
1998 1999
------------ --------------
(IN THOUSANDS)
<S> <C> <C>
Amortization of goodwill pushed down to The Image Bank
by Eastman Kodak Company............................. $1,508 $ 754
Impact of amortizing certain intangibles over ten
years -- previously amortised by The Image Bank over
15 years............................................. (263) (131)
------ ------
$1,245 $ 623
====== ======
</TABLE>

(b) Net goodwill pushed down to the accounting records of The Image Bank of
$14.9 million has been deducted in order to compute net assets acquired.

(c) Immediately prior to completion of the acquisition of The Image Bank,
intercompany indebtedness of $55.2 million is to be reclassified as part of
shareholders' equity.

2. PRO FORMA ADJUSTMENTS TO INCOME STATEMENT

The pro forma adjustments comprise the following:

(a) Amortization of intangible assets, had the acquisitions of Art.com and
The Image Bank taken place on January 1, 1998.

<TABLE>
<CAPTION>
YEAR ENDED SIX MONTHS
DECEMBER 31, ENDED JUNE 30,
1998 1999
------------ --------------
(IN THOUSANDS)
<S> <C> <C>
Amortization of goodwill relating to Art.com........... $40,745 $20,373
Amortization of goodwill relating to The Image Bank.... 11,102 5,551
Amortization of The Image Bank's other intangible
assets............................................... 5,042 2,521
------- -------
56,889 28,445
Less amount amortized by Getty Images in the period
following the Art.com acquisition.................... -- (6,790)
------- -------
$56,889 $21,655
======= =======
</TABLE>

The acquisition of Art.com generated goodwill of $122.2 million. A
preliminary review of the audited financial statements of Art.com indicated that
no material adjustment would arise from a purchase price allocation of separate
identifiable assets and that the excess of purchase price over

50
<PAGE> 52
NOTES TO THE UNAUDITED PRO FORMA CONSOLIDATED
FINANCIAL INFORMATION (CONTINUED)

net assets has been allocated to goodwill. We consider three years to be a
suitable period of amortization of this goodwill.

The acquisition of The Image Bank will generate goodwill of approximately
$110.0 million and other intangible assets of approximately $20.2 million, based
on the preliminary allocation of the purchase price (see Note 3(b)). We consider
ten years to be a suitable period of amortization for this goodwill and will
amortize the other intangibles over a period of four years.

(b) Interest expense on long-term debt and loan notes

The acquisition of The Image Bank will be funded in part through bank
long-term debt amounting to $50.0 million. Interest is payable on the long-term
debt at 1.5% above U.S. dollar LIBOR, which is assumed to be 7.0% for 1998 and
the six months to June 30, 1999 for the purposes of this Pro Forma Financial
Information.

The resulting interest charge to the income statement, had the acquisitions
taken place on January 1, 1998, would have been as follows:

<TABLE>
<CAPTION>
SIX MONTHS
YEAR ENDED ENDED JUNE
DECEMBER 31, 30,
1998 1999
------------ ----------
(IN THOUSANDS)
<S> <C> <C>
Interest on long-term debt............................. $3,500 $1,750
Amortization of arrangement fee over a three year
period............................................... 233 117
------ ------
$3,733 $1,867
====== ======
</TABLE>

The bank variable interest rate assumed above is based on rates prevailing
during each period indicated. A .125% variance in variable interest rates would
have an impact of $62,500 and $31,250 on the pro forma interest expense for the
year ended December 31, 1998 and the six months ended June 30, 1999,
respectively.

(c) The pro forma interest charge is offset by a reduction in taxes equal
to 35.0% of the interest charges. The resulting credit to the income statement
that would have occurred had the acquisitions of Art.com and The Image Bank
taken place on January 1, 1998 is $1.2 million for 1998 and $612,500 for the six
months ended June 30, 1999, respectively.

(d) The number of shares outstanding and used for the pro forma basic
earnings per share is calculated as follows:

<TABLE>
<CAPTION>
DECEMBER 31,
1998 JUNE 30, 1999
------------ -------------
(IN THOUSANDS)
<S> <C> <C>
Getty Images shares at December 31, 1998 and June 30,
1999................................................. 29,160 32,134
New shares issued to fund the acquisition of The Image
Bank.................................................
</TABLE>

51
<PAGE> 53
NOTES TO THE UNAUDITED PRO FORMA CONSOLIDATED
FINANCIAL INFORMATION (CONTINUED)

3. PRO FORMA ADJUSTMENTS TO BALANCE SHEET

(a) The effect of the acquisitions of Art.com and The Image Bank on cash
and cash equivalents is summarized below:

<TABLE>
<CAPTION>
JUNE 30, 1999
----------------------
(IN THOUSANDS)
<S> <C> <C>
Cash received on issue of new shares....................... $ 133,000
New long term debt......................................... 50,000
---------
Total cash raised to fund The Image Bank
Acquisition.................................... $ 183,000
Less costs:
Cash consideration to the holders of The Image Bank common
stock.................................................... $(183,000)
Getty Images' estimated costs of the transaction........... (6,000)
Estimated costs for issue of new shares of Getty Images'
common stock............................................. (7,315)
Arrangement fee for bank loan.............................. $ (700)
---------
$(197,015)
---------
Net effect on cash and cash equivalents.................... $ (14,015)
=========
</TABLE>

(b) Under the Stock Purchase Agreement, holders of shares of The Image Bank
common stock will be entitled to receive, at the effective time of the
acquisition, the cash purchase price. The following summarises the cost of
acquisition and the preliminary purchase price allocation:

PURCHASE PRICE OF THE IMAGE BANK

<TABLE>
<CAPTION>
(IN THOUSANDS)
<S> <C>
Cash consideration to holders of The Image Bank Common
Stock..................................................... $183,000
Getty Images' transaction expenses.......................... 6,000
--------
Total purchase price........................................ 189,000
Estimated fair value of net assets of The Image Bank (see
Note 3(f))................................................ (58,817)
--------
Excess of purchase price over net assets acquired........... $130,183
========
Amount allocated to other intangibles (amortized over 4
years).................................................... $ 20,168
========
Amount allocated to incremental goodwill (amortized over 10
years).................................................... $110,015
========
</TABLE>

(c) The debt required, totalling $50.0 million, together with the
associated costs, are reflected in the pro forma balance sheet as follows:

<TABLE>
<CAPTION>
(IN THOUSANDS)
<S> <C>
Long term debt.............................................. $50,000
Less: estimated arrangement fee amortized over period of
loan...................................................... (700)
-------
$49,300
=======
</TABLE>

(d) The acquisition of The Image Bank will be funded in part by the cash
received from this offering.

52
<PAGE> 54
NOTES TO THE UNAUDITED PRO FORMA CONSOLIDATED
FINANCIAL INFORMATION (CONTINUED)

(e) The estimated fair value of the net assets of The Image Bank, after
taking account of goodwill pushed down to the accounting records of The Image
Bank by Eastman Kodak Company, is calculated as follows:

<TABLE>
<CAPTION>
(IN THOUSANDS)
<S> <C>
Total shareholders' equity.................................. $73,687
Net goodwill pushed down to The Image Bank by Eastman Kodak
Company................................................... (14,870)
-------
Estimated fair value of net assets of The Image Bank........ $58,817
=======
</TABLE>

(f) The following consolidation adjustment is required in respect of
shareholders' equity as a result of the acquisition of The Image Bank:

SHAREHOLDERS' EQUITY

<TABLE>
<CAPTION>
(IN THOUSANDS)
<S> <C> <C>
Estimated fair value of net assets of The Image Bank (Note
3(f))..................................................... $(58,817)
New shares of Getty Images Common Stock issued.............. $133,000
Less estimated share issue costs............................ $ (7,315)
--------
$125,685
========
$ 66,868
========
</TABLE>

4. GENERAL

(a) The Pro Forma Consolidated Financial Information does not include
adjustments to eliminate amounts relating to transactions between Getty
Images and The Image Bank because such amounts are not considered
material.

(b) Potential cost savings and efficiencies resulting from the Acquisitions
have not been reflected in the Pro Forma Consolidated Financial
Information.

53
<PAGE> 55

BUSINESS

OVERVIEW

We are a leading provider of imagery to businesses and consumers worldwide.
We distribute our products digitally via the Internet, on CD ROMs and in analog
form. We are pioneering a solution to aggregate and distribute visual content.
Since 1995, we have consolidated many of the visual content industry's leading
brands. We have acquired important brands such as Tony Stone Images, a leading
worldwide provider of contemporary stock photography; PhotoDisc, a pioneer in
the development and marketing of digital stock photography, which uses the
royalty-free licensing model, and the electronic delivery of images; Allsport, a
leading worldwide sports photography provider; EyeWire, a leading provider of
royalty-free imagery and visual content-related products and services to the
business user market; and Art.com, a leading provider of framed and unframed art
and art-related products to consumers on the Internet. Following our recently
announced acquisition of the Image Bank, we will own an estimated 60 million
still images and an estimated 27,000 hours of film footage. We provide our high
quality, relevant imagery to creative professionals, press and editorial
companies, business users, small offices/home office users and consumers. By
aggregating the content of our various leading brands on the Internet and
partnering with third party providers of imagery and other content, we offer a
comprehensive and user friendly solution for our customers' imagery and related
products needs. We seek to leverage our internally-developed search and
e-commerce technology to enhance our position as a leading provider of visual
content over the Internet.

INDUSTRY BACKGROUND

THE VISUAL CONTENT INDUSTRY

Visual content is everywhere. Its purpose is to enlighten, inspire,
entertain, communicate messages and enhance aspects of business and commerce.
Businesses and consumers use images every day to communicate, symbolize and
reinforce a variety of messages in a powerful manner. Business users typically
integrate imagery into various media, such as advertisements, billboards, direct
mail, magazines, newspapers, packaging, motion pictures, television programming
and commercials and websites. Consumers, forming a distinct market segment, have
traditionally purchased images for decoration or pleasure, often buying wall art
or posters. With the advent of the Internet, consumers have turned to images for
new uses, such as communicating through e-greeting cards and enhancing personal
websites. Imagery is a dynamic and forceful communication tool because the user
is able to capture a thought or idea in a simple way. Imagery has no language
barriers and can often convey universal messages. As a result, as businesses
continue to globalize, companies are increasingly using visual content as a
means of communicating with a broader customer base. The following Allsport
image appeared in various publications and on websites when Major League
Baseball's homerun record was broken during the summer of 1998:

[Image of Mark McGwire]

The visual content industry supplies visual content like the above image to
a varied and growing customer base. Visual content can be broadly divided into
commissioned imagery and non-commissioned imagery. Users obtain commissioned
images by engaging photographers or cinematographers to create an image, often
for a single predetermined use. Non-commissioned images, commonly referred to as
"stock," are provided by companies that maintain collections of selected images
which can be licensed for use by different customers and for a variety of
purposes.

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We believe that the demand for visual content has grown consistently
throughout the twentieth century. This growth can be attributed in part to
technological improvements which have made imagery more accessible and the
proliferation of both print and television media. Recently, the growth has been
accelerated by the use of still images and film footage on the Internet.

TRADITIONAL ANALOG DISTRIBUTION OF VISUAL CONTENT

The visual content industry involves the creation, acquisition, storage,
distribution and end-use of both still and moving images. Traditionally, images
have been captured and distributed in analog or physical form. This has required
a lengthy process for the image provider, including the following steps:

Image Creation Process. The visual content provider determines that demand
exists for a particular image and hires or contracts with a photographer and
other required personnel to capture the image.

Production Process. The provider manages the process of developing the film
to create the raw imagery and then edits and selects the appropriate image.

Marketing and Distribution Process. The provider then incorporates the
image into appropriate marketing materials, principally catalogs, to make the
images available to the market. The provider must also determine which locations
are likely to experience the strongest demand for the images in order to make an
appropriate number of copies of the image physically available. The images must
then be transported to, and stored at, the appropriate places and be readily
accessible for customer searches and selection.

Analog distribution has also involved a number of relatively inefficient
steps for the customer:

Selecting the Provider. The visual content industry has historically been
comprised of a number of small companies, often focusing on relatively narrow
ranges of available images. Consequently, when a customer decides to acquire a
particular image, the customer must often select a number of providers to work
with in the hopes that one of them will carry the desired image. In fact, for
many customers, it has been more time efficient to commission a photographer
directly to create the desired image.

The Image Selection Process. The customer traditionally contacts a sales
representative at each selected provider and establishes the relevant parameters
for the appropriate image. The representative, in turn, works to research the
inventory to determine whether the requested image is available. Because analog
images are traditionally stored in physical form, they must be manually searched
to determine whether a match exists. If the image is not in the provider's
inventory, the provider is unlikely to be able to meet the customer's need. Once
the provider has finally located an appropriate image for selection, the image
must be shipped to the customer who, in turn, makes a final determination
whether to pay for the image.

The Purchase Process. Once the image has been selected, the customer must
indicate how the image will be used, in what type of publication, in which
geographic region and the duration of use. Once these parameters are
established, the customer and the provider can negotiate a price.

The visual content industry, established in a purely analog environment,
remains fragmented, with a few international providers, a number of regional
providers and a large number of small businesses that specialize in a particular
content type or geographic area.

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GROWTH OF THE DIGITAL DISTRIBUTION OF VISUAL CONTENT

Digital image technology is the capturing of an image in a form that can be
stored, easily manipulated and quickly retrieved from a computer. While visual
content providers continue to create and distribute imagery in the analog
format, they are increasingly using digital technology. The migration toward
digital technology has had dramatic implications for improving the process both
from a customer and content provider perspective, including:

Benefits to Customers. Digital technology enables customers to control the
entire search process. Customers can perform keyword searches on their own PCs
immediately to search the content of an entire collection, with or without the
assistance of customer service personnel, and learn the results of their search
on a real time basis. Customers are able to download the image immediately,
eliminating the need for physical images to be distributed to them for
inspection prior to completing the transaction. The purchase parameters can be
determined online and customers can be given a price without the traditional
negotiation process. As a result, several time consuming steps in the
transaction process can be eliminated.

Benefits to Visual Content Providers. Visual content providers are also
realizing a number of efficiencies by shifting to digital technology. The
collections of the visual content providers are now immediately accessible to
their customers. Content providers no longer need to keep duplicates of each
image in offices which may be dispersed worldwide. Instead, the images may be
digitally stored on a central server and delivered digitally or printed as
needed. A provider can achieve operating efficiencies because the filing,
pulling and mailing of physical images has been virtually eliminated. In
addition, because increased digital storage and delivery of images can be added
cost effectively, there is virtually no limit to the number of images that a
single provider can offer. This provides an opportunity to achieve economies of
scale by consolidating the widely fragmented visual content industry, thereby
leveraging an increased offering of images over a wide range of business and
consumer customers.

THE GETTY IMAGES SOLUTION

We are a leading provider of images to businesses and consumers worldwide.
We are pioneering a solution to aggregate and distribute visual content. By
aggregating the content of our various leading brands and partnering with third
party providers of imagery and other content, we offer a comprehensive and user
friendly solution for our customers' imagery and related product needs. We
provide high quality, relevant imagery in analog or digital format to creative
professionals, press and editorial companies, business users, small offices/home
office users and consumers. By leveraging our internally developed search and
e-commerce technology, we are able to distribute our broad range of imagery and
related products to our customers through multiple channels, including our
e-commerce enabled websites. We have content creation and distribution teams
located around the world, giving us an established international presence.

We offer our customers the following benefits:

Hassle-Free, Comprehensive Solution. Our solution enables our customers to
save time and money by providing them with an efficient tool to locate and
obtain what they need. While we continue to promote our products through print
and CD ROMs, our Internet capabilities provide a more efficient and increasingly
popular marketing, sales and distribution medium. We have an internally
developed search tool that quickly locates requested images or footage clips
available in our collections. By utilizing key words, a customer scans all of
the selected brand's digitized collection at once and our search tool quickly
produces the most appropriate images. Our customers are able to complete an
entire image transaction on the Internet quickly and efficiently, while also
benefiting from the support of our full time customer service personnel. Due in
part to this streamlined imagery location process, we believe our customers are
increasingly utilizing the

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faster and less expensive non-commissioned photography and footage options and
are realizing further cost savings in the process.

High Quality, Up-to-Date Content. Our comprehensive collection of still
images and film footage covers the major categories of the visual content
industry, including contemporary images, news and features, sports, celebrity
and fine art. In order to increase the breadth of our collection, our estimated
3,500 photographers worldwide, a number of whom have won awards for their work,
are constantly contributing new imagery. Our digitization capabilities allow us
to include new images in our collections immediately and to disseminate those
new images to our customers quickly.

To maintain the quality of our collection and provide our customers with
the most up-to-date content, our team of editors continually reviews the latest
imagery and focuses on the aesthetic and technical quality of the image, as well
as the collection as a whole. When a new trend emerges, we examine our
collection to determine if we have an appropriate variety of images covering the
trend and, if not, we seek to quickly add new relevant images.

24x7 Customer Service. Our customers often face imminent deadlines. Many of
our customers, particularly in the advertising and news businesses, work late
hours or even through the night to meet their deadlines. We satisfy their
demands by providing high quality, personalized customer service 24 hours a day,
seven days a week through our approximately 300 customer service representatives
with broad knowledge of the images in our collection. In addition, we make our
consultants, who have expertise in digital image applications, design tools and
photo manipulation methodologies, available to our customers. We believe we are
also innovative in the development and distribution of image-related products
and services that assist our customers with the use and integration of imagery
into their workflow. For example, our Business User division offers information
and software tools and applications designed to enhance the design ability of
its customers.

STRATEGY

Our objective is to enhance our position as a leader in the visual content
industry. We seek to leverage our breadth of content and internally developed
technology to provide comprehensive, high quality, up-to-date images to a broad
range of business and consumer customers in ways that efficiently meet their
needs. Key elements of our strategy include:

Promote Online Distribution. We have designed our technology to allow us to
use the Internet effectively to market and sell images to our customers and
increase the size of our customer base. We have engaged in marketing campaigns
targeted at customers most likely to benefit from moving their image
transactions online. We continue systematically to select our most widely used
images for digitization. In the first half of 1999, our e-commerce revenues
accounted for 22.5% of our total revenues, as compared to 13.4% in the same
period of 1998. Of these e-commerce revenues, 32.5% came from new customers. We
will continue to promote online distribution of visual content in order to
realize greater cost efficiencies, better meet our customers' needs and provide
more efficient customer service.

Create Vertical Portals for our Key Customer Segments. Our customers fall
into the following four segments: (1) creative professionals, including
advertising and design agencies and the marketing and communications departments
of other businesses, (2) press and editorial, including newspapers, magazines
and news-related websites (3) business users outside the marketing and
communications departments of the enterprise and (4) consumers. We are
consolidating our existing e-commerce-enabled branded websites into vertical
portal websites for each segment to simplify the image purchase process. We
intend to have each vertical portal focus on addressing the specific needs of
its particular customer segment and feature imagery and related products from
relevant

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Getty brands. Our first vertical portal, gettyone, located at www.gettyone.com,
will serve the creative professional market, and is expected to launch in the
fourth quarter of 1999. Each vertical portal will also feature products from
third-party providers. For example, the Bridgeman Art Library, one of the
leading providers of fine art imagery worldwide, will appear on gettyone.

Increase Penetration of the Consumer Marketplace. Through Art.com, we
intend to build the leading destination for selecting and purchasing art and
art-related products online. We are also using Art.com as a channel to enable
our consumers to access the voluminous archival collection of Hulton Getty.
Art.com is our point of entry into the consumer market and we are expending
significant resources to build consumer awareness about the website with an
aggressive print, outdoor and radio advertising campaign in selected
metropolitan markets. We will continue to attempt to build traffic to Art.com
through new and existing online relationships to reach our targeted demographic
audience. Existing relationships include AOL, Yahoo!, Women.com and iVillage.
Our affiliates program, which links third party websites to Art.com and allows
customers to place orders for Art.com products, is another integral part of our
plan for growth in the consumer marketplace.

Maintain Technology Expertise. We will continue to use our growing
technological expertise to facilitate the online search, selection, purchase and
delivery of imagery from our digital content collections. Our focus will be on
enhancing our network expertise and our internally developed keyword search
engine. With our increasing emphasis on the Internet, Internet-enabled
applications and digital delivery systems, we intend to enable our customers to
search for, purchase and download the most relevant images for their projects in
the quickest and easiest manner possible.

Leverage Strategic Alliances. We will continue to develop and employ
strategic alliances to direct traffic to, and increase relevant content on, our
branded websites and vertical portals. Our traffic driving alliances include
Adobe Systems, Amazon.com, Excite@Home, RealNetworks, Intuit and Digimarc. We
intend to enhance these relationships and pursue new strategic alliances to
promote our brand name and increase content and traffic on our websites. In
addition to traffic driving relationships, we are actively pursuing alliances
with providers of complementary content and services to enhance the breadth and
scope of our product offerings.

Pursue Strategic Acquisitions. We believe that the fragmented nature of the
industry provides us with a significant opportunity to continue to aggregate
content and increase our customer base. Since 1995, we have acquired a number of
businesses, including Tony Stone Images, PhotoDisc, Allsport, Art.com and
Eyewire. On September 20, 1999, we entered into an agreement to purchase The
Image Bank, a leading provider of contemporary and archival stock photography,
film footage and illustrations worldwide. We will continue to target companies
that offer complementary content; a presence in a geographic market where we are
under-represented; access to new or complementary technologies standards; or
established relationships with customer segments that we have targeted.

PRODUCTS AND SERVICES

We offer our customers an estimated 30 million still images, an estimated
12,000 hours of film footage and related products through the Internet, CD ROM,
catalogs and our international distribution network of company-operated offices
in 23 cities and agents and distributors in 51 countries. Our visual content
brands are organized into four divisions to serve our major types of customers:
(1) Creative Professional, (2) Press and Editorial, (3) Business User and (4)
Consumer.

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The following chart sets forth information regarding the brands, imagery
products, marketing efforts and distribution capabilities for each of our four
divisions:

<TABLE>
<S> <C> <C> <C> <C> <C>
- -------------------------------------------------------------------------------------------------------------------------
DIVISIONS CUSTOMERS BRANDS WEBSITE/URL IMAGERY PRODUCTS MARKETING
- -------------------------------------------------------------------------------------------------------------------------
CREATIVE Advertising, Tony Stone www.tonystone.com Contemporary stock Website, printed cata-
PROFESSIONAL graphic design, Images photography, licensed logs, direct mail, CD
marketing and PhotoDisc www.photodisc.com and royalty- free, and ROM and demonstration
corporate Energy Film www.digital- stock film footage reels
communications Library energy.com
groups
- -------------------------------------------------------------------------------------------------------------------------
PRESS AND Newspapers, Allsport www.allsport.com Sports, news and Website, subscription
EDITORIAL magazines, Liaison Agency www.liaisonphoto.com features, celebrity and customer service
publishers Online USA www.onlineusa.com and archival
Hulton Getty www.hultongetty.com photography
- -------------------------------------------------------------------------------------------------------------------------
BUSINESS USER Design firms, EyeWire www.eyewire.com Royalty-free imagery, Website and catalog
in- house software, typefaces
creative and other design
services resources
departments and
business owners
- -------------------------------------------------------------------------------------------------------------------------
CONSUMER Individuals Art.com www.art.com Framed and unframed Traditional and website
art and related advertising, direct
products marketing and affiliates
program
- -------------------------------------------------------------------------------------------------------------------------
</TABLE>

CREATIVE PROFESSIONAL DIVISION

Our Creative Professional division supplies images to professional image
users, such as advertising and design agencies, website designers and corporate
communications specialists. Our images cover a wide variety of contemporary
subjects including lifestyles, families, business, science, health and beauty,
sports, transportation and travel. These customers usually have an idea of the
message they are trying to convey and, consequently, are typically looking for a
specific conceptual image. Image quality and relevance are important factors in
the customers' decision. These customers need to access imagery as part of their
everyday working life. Their workflow is becoming increasingly digital, which we
believe will spur further demand for our images and services in this market.

Our Creative Professional division is comprised of three brands:

Tony Stone Images is a leading worldwide provider of contemporary stock
photography and is recognized as being trendy, hip and on the cutting edge of
stock photography. Tony Stone Images offers images for licensing on a per-use
basis and provides customers with the option to reserve the rights to an image
for a particular type of publication, for a specified period of time, in a
particular geographic area or in a specific industry. This rights-control system
is critical in allowing us to license the same image multiple times, thus
maximizing the return per image. Tony Stone Images offers many of its images
online at www.tonystone.com.

PhotoDisc is a pioneer in the development and marketing of digital stock
photography, products and electronic delivery of images. Its products are
offered on a royalty-free basis, which allows customers to pay a one-time fee to
use an image on a perpetual, non-exclusive basis for almost any purpose.
PhotoDisc offers all of its images online at www.photodisc.com.

Energy Film Library is an international provider of stock film footage to
the advertising, television, feature film, video corporate communications and
new media markets. Energy Film Library offers its moving images online at
www.digital-energy.com.

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Image Creation and Editing

We continue systematically to select our most widely used images for
digitization. Tony Stone Images and PhotoDisc are fully e-commerce enabled and
are rapidly migrating their businesses to an entirely web-based model. All of
the digitized images of these brands are available for search, selection and
immediate download from their respective websites 24 hours a day, seven days a
week. Energy Film Library maintains and licenses a growing library of an
estimated 12,000 hours of commercially desirable cinematography covering a broad
range of contemporary and archival subject matter.

We have creative teams in London, Los Angeles, Munich, Paris, Seattle and
New York that analyze customer requests and buying behavior and perform research
in key markets in order to target and source images. Our Creative Professional
division has an estimated 1,800 active contributing photographers, including
highly respected, internationally renowned professional photographers
representing a variety of styles, specialties and backgrounds. The Energy Film
Library offers a breadth of imagery and high resolution content, which is
cataloged on computer for quick access and retrieval in film, tape and digital
formats. Energy Film Library represents imagery from an estimated 400
cinematographers and film producers.

Marketing

We reach our creative professional customers through a diverse set of
marketing channels. We believe that these channels create brand awareness and,
in many cases, act as sales tools in the selection of image products for
license. We also serve our international markets by producing localized
marketing materials where appropriate.

Online Marketing. Our websites act as marketing tools as well as sales
tools, making the images of each collection available for research and selection
online. For example, we provide imagery to Amazon.com for its electronic
greeting cards.

Printed Catalogs and Direct Mail. We use catalogs to market the
contemporary photography of Tony Stone Images and PhotoDisc. We believe that our
catalog quality contributes to our strong reputation. These catalogs are also
used to promote our websites as well as our other product offerings.

CD ROM and Demonstration Reels. Several of our brands, including PhotoDisc
and Tony Stone Images, produce CD ROM catalogs, which enable customers to select
from a wide range of images on-screen and, in some cases, provide direct links
to the corresponding website. Energy Film Library markets our film footage
through demonstration reels sent directly to our existing and potential
customers. These demonstration reels contain samples of available footage.

Distribution

While we are focused on directing our creative professional customers to
the e-commerce environment, we continue to support and serve our customers who
wish to receive our branded content products through traditional analog means,
which involves the physical distribution of imagery on duplicate transparencies.
In many instances, we serve customers through a combination of e-commerce and
more traditional methods of customer service.

Digital Distribution. We are actively promoting digital distribution of
imagery and related products and services through the Internet. We believe this
offers our customers advantages in terms of convenience, speed and cost
efficiency, and enables us to achieve greater economies of scale. PhotoDisc has
been an industry leader for Internet delivery of imagery since 1995, and we have
leveraged this expertise to develop a successful e-commerce business for Tony
Stone Images.

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PhotoDisc's e-commerce sales exceeded $20.0 million in 1998 and exceeded
$14.6 million for the first six months of 1999.

Traditional Analog Distribution. We also market images through our broad
international distribution network of company-operated offices and agents and
distributions in approximately 140 locations in 51 countries. We believe that
control of our outlets results in more focused marketing activities and better
brand maintenance. A direct sales force and key account management team targets
advertising, publishing and communications companies, as well as other high
volume users of images. Our direct sales force focuses on reaching image
purchasers who are generally responsible for large order purchases. In order to
assist our customers in using the images they license, our sales force includes
technical support staff and training personnel who provide assistance both
before and after the sale. These consultants have expertise in digital image
applications, design tools and photo manipulation methodologies. Customer
service and technical support for Tony Stone Images and PhotoDisc are based in
Seattle.

PRESS AND EDITORIAL DIVISION

Our Press and Editorial division supplies images to a customer base of
professional image users who are involved in the publication of newspapers,
books and magazines, both online and in traditional media, as well as the
production of documentaries, and other editorial media. The imagery that is
provided by this division ranges from contemporary news, celebrity and feature
material, and sports imagery, to archival imagery covering major political,
social and sporting events since the beginning of photography in the early
nineteenth century. The customers specifically addressed by the Press and
Editorial division are looking for imagery that conveys information to
illustrate the story they are covering and often require the imagery to be
delivered rapidly after the event has occurred.

The Press and Editorial division has four key brands:

Allsport is a leading agency providing sports photography worldwide, with
an archive of an estimated five million still images from sporting events around
the world dating from 1896, and includes visual content that is both specialist
and generalist, most of which is wholly owned by Allsport. Allsport is a
commissioned photographer for the International Olympic Committee and the U.S.
Olympic Committee marketing partners, Major League Baseball, Major League Soccer
and the WTA Tour. Allsport adds an estimated 6,000 still images on average per
week to its portfolio, and has approximately 45 contributing photographers.
Allsport offers its images online at www.allsport.com.

Liaison Agency is a news and reportage agency that serves North America.
Liaison Agency receives material from an estimated 3,500 photographers worldwide
and its library contains photographs covering the major events, personalities
and entertainment of the last 30 years. Since 1986, images accepted by the
agency have been indexed using key words, creating one of the largest databases
in the industry. Liaison Agency offers its images online at
www.liaisonphoto.com.

Online USA is a Los Angeles-based agency specializing in the sourcing and
distribution of North American celebrity imagery over the Internet. The agency
was founded in 1994 as a purely digital business. Online USA offers its images
online at www.onlineusa.com.

Hulton Getty is one of the largest privately owned collections of archival
photography in the world, consisting of an estimated 300 separate collections
totaling an estimated 18 million still images. The imagery has been collected
from all over the world and consists of significant events, people and places
from the nineteenth and twentieth centuries, and vintage prints by renowned
photographers such as Man Ray, Bill Brandt, Alfred Eisenstadt and Robert Capa.
Hulton Getty offers its images online at www.hultongetty.com.
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Image Creation and Editing

The ability to source imagery from events taking place as they occur and
make them immediately available to customers is critical to the success of the
Press and Editorial division. To this end, we have production hubs in New York,
Los Angeles, London and Sydney to which photographers can submit imagery at any
time. The Press and Editorial division employs approximately 50 staff
photographers and has contractual relationships with an estimated 1,000
additional photographers. In addition to topics that we believe will be of
interest perennially, we seek to identify upcoming events that will generate
demand for particular archival images. We also offer in-depth research services
for more extensive projects that our customers may have or imagery they may
require immediately.

We digitize thousands of images on average per week and make them available
through a proprietary online subscription service and over the Internet. By
using digital cameras, we are able to have some new images online within fifteen
minutes of creation from major events such as The World Series or The Academy
Awards. In addition, we continually review our existing analog collections and
select imagery for digitization, which we anticipate will be requested by
customers.

Marketing

The Press and Editorial division markets our branded imagery primarily
through printed catalogs and websites.

Allsport, Online USA and Liaison Agency regularly provide a summary of the
latest breaking stories to their respective websites where customers can see
available imagery. These websites are currently being enhanced to offer a
unified digital source for the direct purchase and download of imagery. In
addition to these websites, we proactively approach our customers to inform them
of the stories that are available for purchase and seek to develop close
relationships between our customer service representatives and our customers. We
offer a subscription service to the customers in the Press and Editorial
division, providing them with relevant material. Finally, Liaison Agency markets
its assignment photography business via a website which enables customers to
view the work of photographers and to contact the agency on-line to arrange
assignments.

Distribution

The Press and Editorial division distributes imagery by a variety of means.
It uses online distribution methods, including the Internet, an ISDN
Point-to-Point network, the Photo Stream satellite network maintained by the
Associated Press, and a number of other third-party provided digital
transmission methods. In addition, the division leverages our international
network of offices and agents to ensure prompt and convenient support service to
the transmission systems and to provide access to physical duplicate
transparencies to customers that prefer to receive imagery in this fashion.

BUSINESS USER DIVISION

Our Business User division supplies imagery to the business user and small
office, home office, or SOHO, markets. The Business User division currently has
one key brand, EyeWire, which is one of the largest providers of royalty-free
imagery to business users and SOHO customers. In addition, EyeWire offers
related content and services which allow customers to produce professional
quality work product incorporating imagery, typefaces and other design elements.
EyeWire's non-imagery products include productivity-enhancing visual and audio
content, online software tools and design resources.
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Image Creation and Other Products

The Business User division sources new imagery from third party vendors and
produces its own branded content through independent photographers and image
suppliers. This division has relationships with third-party vendors to
distribute products such as typefaces, software applications, audio products and
illustrations which are complementary to the core image offering. The vendors
typically provide new products to EyeWire as they are released on the market.
Our Business User division currently has relationships with companies such as
Adobe Systems, Pantone and Digital Vision.

Marketing

The Business User division's marketing efforts are focused on the
award-winning EyeWire catalog and the EyeWire website, at www.eyewire.com.

EyeWire Catalog. Each month, EyeWire distributes an average of 750,000
sales catalogs worldwide. EyeWire has distributed approximately 47 million of
its catalogs to date. The EyeWire catalog has won numerous awards and offers
products from many leading brands.

Online Marketing. EyeWire also offers its products through its website.
EyeWire adds an estimated average of 5,000 new pieces of content to the Internet
each month. EyeWire has strategic alliances with RealNetworks, Earthlink,
Printonthenet.com, ImageX.com, DemoRoom.com and Pantone Color Systems. These
alliances involve an exchange of service, cross-promotion and cross-marketing
activities focused on mutual business development. For example, in connection
with the Earthlink alliance, EyeWire, as Earthlink's featured image provider,
provides images to Earthlink for use by its customers in building personal
websites.

Distribution

The Business User division delivers its content predominantly through the
Internet. Catalog orders are processed and distributed through a centrally
located fulfillment center.

CONSUMER DIVISION

The Consumer division currently consists of Art.com, a leading provider of
framed and unframed art and art-related products on the Internet. Art.com's
monthly feature galleries and My Gallery, a personal gallery that can be
created, saved and shared, allow users to browse for appropriate prints for
their needs and budgets.

Art.com's website features proprietary technology that allows customers to
visualize an estimated one billion custom matting and framing combinations for
their selected print on-screen before purchasing. It offers a number of services
such as the ArtClique Savers Club, which offers consumers discounts and special
offers, art-care tips with every purchase, monthly feature galleries, and My
Gallery. Art.com also offers Art Print Index (www.artprintindex.com) for
sourcing and buying prints on a wholesale basis.

Image Creation and Selection

Art.com has an estimated 100,000 images online, including works by artists
such as Monet, van Gogh and Picasso, and photographers such as Herb Ritts and
Robert Mapplethorpe. This imagery is secured from third-party owners and
publishers of imagery. The imagery that is created and owned by other Getty
brands can be leveraged into products offered through Art.com. For example, we
have created a Hulton Getty gallery on the Art.com website.

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Marketing

Traditional Advertising. We launched an aggressive advertising campaign for
Art.com in September 1999 and plan to build the brand through outdoor
advertising, free postcard advertisements, radio advertisements and
advertisements in newspapers and magazines that target the art community. We
believe this ongoing advertising program will facilitate the growth of the
brand, increase its name recognition and direct new customers to its online
store. In addition, we plan to direct traffic to the Art.com website through new
and existing marketing and business development relationships designed to reach
our targeted customers on a regular basis. Art.com has existing relationships
with companies such as Discover and Merrill Lynch.

Online Advertising. We use online sales and marketing techniques to
increase Art.com brand recognition and direct traffic to its website. We
purchase banner advertising on search engine websites and Internet directories.
In certain cases, when a user searches for information relating to certain
keywords (such as "impressionism") as well as the names of artists, an Art.com
link will automatically be displayed. We currently have Art.com advertisements
on AOL, Yahoo!, Women.com and iVillage, among others.

Direct Marketing. We believe the Internet provides additional opportunities
for direct marketing. We are exploring direct marketing opportunities such as
gallery customization to present each customer with a customized art assortment
based on that customer's historic purchasing patterns. Through Art.com, we make
customized offers such as an e-mail newsletter that includes purchase
recommendations based on demonstrated customer preferences or prior purchases.

Affiliates Program. We believe the affiliates program, with an estimated
13,000 participants, increases Art.com's market presence by allowing affiliate
websites to offer art to their customers for which Art.com ultimately provides
fulfillment. The affiliate embeds a hyperlink to Art.com's website that
automatically connects the customer to the Art.com online store where the
affiliate's customer may place an order. Under these arrangements, we pay the
affiliate a small percentage of the sales they generate.

Distribution

Imagery is made available for search, selection and purchase on the Art.com
website, where customers can choose the format and style that they desire their
images to be delivered. Once the image has been selected, we fulfill the order
in our dedicated facility. We customize product configurations as specified by
the customer and generally ship within 24 hours. We are currently developing
digital printing capacity at Art.com which we believe will enable us to produce
digital prints of archive quality to sizes that can be dictated by the customer.
We believe this will allow us to make more images available on the website
without having to increase the level of print inventory. We intend to make our
digital printing capacity available in the fourth quarter of 1999.

OPERATIONS AND TECHNOLOGY

We have implemented a broad range of technology, systems and services for
the search, selection, purchase, and download of digital content. These systems
span multiple operational activities, including customer interaction,
transaction processing, order fulfillment, invoicing, and customer relationship
management. We use a set of software applications for:

- categorizing digital content and embedding appropriate keywords and
search data (metadata);

- searching large information databases (across languages and linguistic
context);

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<PAGE> 66

- presenting detailed information related to specific digital content
elements;

- managing the online e-commerce transactions for the purchase of digital
content;

- managing the invoice generation and accounts receivable from customers;

- facilitating the communications between internal staff and customers,
suppliers, and partners; and

- tracking a broad range of intellectual property rights and permissions.

These services and systems use a combination of our proprietary
technologies and commercially available, licensed technologies. We focus our
internal development efforts on creating and enhancing the specialized,
proprietary software that is unique to our business. We intend to continue to
investigate, qualify, and develop technology and internal systems that support
key areas of our business to enhance the online and offline experience for our
customers. In particular, we are expending resources on creating a flexible
infrastructure that will facilitate the sale and distribution of third-party
digital content through our online e-commerce systems.

Our image search, image selection, licensing rights management, customer
interaction, order collection, fulfillment and back-end systems are proprietary.
Our online platform architecture is primarily based on Microsoft NT SiteServer.
These systems were designed to provide reliable e-commerce connectivity and
responsive online customer interaction. Our systems infrastructure is hosted
internally at multiple locations and externally at InterNAP. Both internal and
external hosting centers provide 24 hour monitoring, power generators and
multiple back up systems.

COMPETITION

The visual content industry is highly competitive. We believe that the
principal competitive factors are name recognition, company reputation, the
quality, relevance and diversity of the images, the quality of contributing
photographers and cinematographers under contract with a company, effective use
of developing technology, customer service, pricing, accessibility of imagery,
distribution capability and speed of fulfillment. Our current or potential
competitors include:

- other large visual content providers such as Visual Communications Group
and Corbis Corporation;

- specialized visual content companies that are well established in their
local, content or product specific markets;

- consumer oriented websites for art and related products; and

- commissioned photographers.

In addition to competitors and competitive factors applicable to the visual
content industry as a whole, our individual brands are subject to the following
competitors and competitive factors:

Tony Stone Images competes principally with one international competitor,
Visual Communications Group.

Hulton Getty competes with specialized archival collections and regional
stock photography companies with archival content in their collections,
including the Bettman Archive, owned by Corbis, and other privately owned and
public domain collections.

Liaison Agency competes in the U.S. news and reportage industry with a
number of companies that produce and distribute similar material.

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<PAGE> 67

Energy Film Library competes with smaller specialized film footage
providers.

PhotoDisc and EyeWire compete with other royalty-free stock photography
offerings, including Digital Vision and Corbis.

Allsport competes with Reuters and Associated Press for news wire coverage
of sports events.

Art.com competes with a number of online providers of prints and posters as
well as traditional art providers.

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<PAGE> 68

MANAGEMENT

Set forth below is certain information, as of August 31, 1999, with respect
to those individuals who serve as members of our Board of Directors or as our
executive officers.

<TABLE>
<CAPTION>
NAME AGE POSITION
---- --- --------
<S> <C> <C>
Mark H. Getty......................... 39 Executive Chairman and Director
Jonathan D. Klein..................... 39 Chief Executive Officer and Director
Christopher J. Roling................. 38 Senior Vice President, Finance, Chief
Financial Officer and Secretary
Andrew Duncomb........................ 32 Vice President, Developing Markets and
Senior Vice President, Creative
Professional Division
Nicholas Evans-Lombe.................. 33 Senior Vice President, Strategy and
Corporate Development
John Gonzalez......................... 38 Vice President, Strategic Relations
John Hallberg......................... 42 Senior Vice President, Creative
Professional Division
William Lederer....................... 38 President of Art.com
Suzanne L. Page....................... 32 Vice President, General Counsel and
Assistant Secretary
Stephen M. Powell..................... 47 President, Getty Images Editorial and
Press Division
Sally von Bargen...................... 50 President, Getty Images Creative
Professional Division
Bradley Zumwalt....................... 33 Senior Vice President of Business User
Division and President of EyeWire
James N. Bailey....................... 52 Director
Andrew S. Garb........................ 57 Director
Christopher H. Sporborg............... 60 Director
Anthony Stone......................... 67 Director
Mark Torrance......................... 53 Non-Executive Vice Chairman and
Director
</TABLE>

Set forth below is a description of the backgrounds of those individuals
who serve as members of our Board of Directors or executive officers. Our
officers are elected by the Board of Directors and hold their office until their
respective successors are duly elected and qualified.

Mark H. Getty is a co-founder of Getty Images and has been our Executive
Chairman since September 1998 and has been a director since February 1998. Mr.
Getty served as co-chairman and director from February 1998 until September
1998. He served as Executive Chairman and a director of Getty Communications
plc, our predecessor, from April 1996 to February 1998. From March 1995 to April
1996, Mr. Getty served as the Joint Chairman of Getty Communications plc. In
1993, Mr. Getty co-founded Getty Investment Holdings L.L.C. and from 1993 to
1995, together with Mr. Klein, formulated and implemented its strategy. From
1991 to 1993, Mr. Getty worked at Hambros Bank Limited. Mr. Getty serves on the
board of directors of The Conservation Corporation and is Chairman of Getty
Investments L.L.C.

Jonathan D. Klein is a co-founder of Getty Images and has been our Chief
Executive Officer and a director since February 1998. Mr. Klein served as Chief
Executive Officer and a director of Getty Communications plc from April 1996 to
February 1998. From March 1995 to April 1996, Mr. Klein served as the Joint
Chairman of Getty Communications plc. In 1993, Mr. Klein co-founded Getty
Investment Holdings L.L.C. and from 1993 to 1995, together with Mr. Getty,
formulated and implemented its strategy. From 1983 to 1993, Mr. Klein held
various positions at

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<PAGE> 69

]Hambros Bank Limited and was a director from 1989 to 1998. Mr. Klein serves on
the board of Getty Investments L.L.C. and The Conservation Corporation.

Christopher J. Roling has been our Senior Vice President, Finance, Chief
Financial Officer and Secretary since January 1999. Prior to joining us, Mr.
Roling served as Chief Financial Officer of The Kellogg Company for its Europe,
Africa and Middle East regions from August 1996 to January 1999. From May 1995
to August 1996, Mr. Roling served as the Vice President of International
Business Development for R.J. Reynolds International and from 1993 to May 1995
served as the Chief Financial Officer for Northern Europe of Pepsico
International.

Andrew Duncomb has been Vice President, Developing Markets and Senior Vice
President, Creative Professional Division since July 1999 and Managing Director
of Tony Stone Images Rest of the World since October 1998. Mr. Duncomb served as
President of Tony Stone Images/ Hulton Getty Americas from 1997 until October
1998. Mr. Duncomb joined Tony Stone Images in 1990 and became Vice President of
Sales of Tony Stone Images/New York in 1994 before returning to London in 1995
to manage Getty Communications' network of licensees throughout Europe, Asia and
Japan. In 1996, he was Managing Director of Getty Communications plc's
newly-acquired film footage division in North America.

Nicholas Evans-Lombe has been our Senior Vice President, Strategy and
Corporate Development since February 1998 and served as the Director of Strategy
and Corporate Development of Getty Communications plc from 1996 to February
1998. Prior to joining Getty Communications plc in 1996, Mr. Evans-Lombe held
various positions in the corporate finance division at Hambros Bank Limited from
1989 to December 1995. At Getty Communications plc and Getty Images, he has been
involved with strategy, business development and acquisitions.

John Gonzalez has been our Vice President, Strategic Relations since March
1999. Prior to joining us, he was responsible for business development at
Creative Pro.com (formerly Extensis Corporation) from October 1997 through
February 1999. Prior to that time, Mr. Gonzalez managed various strategic and
business planning functions at In Focus Systems, Sequent Computer Systems and
Now Software.

John Hallberg has been Vice President, Creative Division -- Americas and
Senior Vice President, Creative Professional Division since July 1999 and
President of Tony Stone Images North America since October 1998. From September
1996 to October 1998, Mr. Hallberg served as Senior Vice President of Worldwide
Marketing for Encyclopedia Britannica. From January 1995 until September 1996,
he served as Senior Vice President of Client Services for Information Resources,
Inc. Prior to that time, he held various positions at General Mills.

William Lederer founded Art.com in 1997 and has been its Chief Executive
Officer since its inception. Prior to that time, he served as an analyst,
financial manager and vice president-research for various firms. Mr. Lederer
also founded Minotaur Capital Management and its fund, Minotaur Partners, L.P.,
and is the Governor of the School of Art Institute.

Suzanne L. Page joined Getty Images in December 1998 and is Vice President,
General Counsel, and Assistant Secretary. Prior to joining us, Ms. Page was
associated with the law firm of Seyfarth, Shaw, Fairweather and Geraldson from
October 1995 through July 1998 and before that the law firm of Hinshaw and
Culbertson.

Stephen M. Powell is the President of our Press and Editorial Division.
Prior to that Mr. Powell served as the Chief Executive Officer of Allsport
Photographic plc. Mr. Powell helped establish Allsport Photographic plc in 1971,
which we acquired in February 1998.

Sally von Bargen is the President of our Creative Professional Division.
Ms. von Bargen served as President of PhotoDisc, Inc. since February 1998 and
served as its Senior Vice President of Sales and Service from March 1997 to
February 1998. Ms. von Bargen served as a director of
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<PAGE> 70

PhotoDisc, Inc. from 1992 to August 1996, and as an advisor and consultant to
the chief executive officer and president from September 1995 to March 1997. She
was also a senior management consultant with Satellite Market Resources from
September 1992 to November 1996.

Bradley Zumwalt has been Senior Vice President of our Business User
division since August 1999. He founded EyeWire in 1998 and continues to serve as
its Chief Executive Officer and President. From 1994 to 1998, Mr. Zumwalt was a
Vice President of Adobe Systems and was responsible for Adobe's visual content
business worldwide. Prior to that time, Mr. Zumwalt held executive level sales
and marketing positions at Aldus, Inc. and Image Club Graphics.

James N. Bailey has been a director since February 1998 and served as a
director of Getty Communications plc from September 1996 to February 1998. Mr.
Bailey is a founder of Cambridge Associates, Inc., an investment consulting
firm, and has served as its President since its inception in May 1973. He also
serves on the board of directors of The Plymouth Rock Company, SRB Corporation,
Inc., Direct Response Corporation, Coolidge Investment Company Inc., Homeowners
Direct Company and a number of not-for-profit organizations, including the New
England Aquarium.

Andrew S. Garb has been a director since February 1998 and served as
director of Getty Communications plc from May 1996 to February 1998. Mr. Garb
also has served as a director of Getty Investments L.L.C. and its predecessor,
Getty Investment Holdings L.L.C., since 1993. Mr. Garb is a partner with Loeb &
Loeb, L.L.P., a U.S. based law firm, and was the firm's managing partner from
1986 to 1992.

Christopher H. Sporborg has been a director since February 1998 and served
as a director of Getty Communications plc from May 1996 to February 1998. From
its inception in 1993 until April 1996, he served as a Chairman of Getty
Investment Holdings L.L.C. Mr. Sporborg held various positions at Hambros Bank
Limited from 1962 to 1998, including deputy chairman of Hambros PLC. Among other
positions, Mr. Sporborg is founder and Chairman of Hambros Countrywide Assured
PLC, Hambros Insurance Services Group PLC and Atlas Copco PLC; Deputy Chairman
of CE Health PLC; and a director of Trade Indemnity PLC.

Anthony Stone has been a director since February 1998 and served as a
director of Getty Communications plc from March 1995 to February 1998. Mr.
Stone, the founder of Tony Stone Images, served as Chairman and Managing
Director of Tony Stone Images from 1969 to 1992. From 1992 until the acquisition
of Tony Stone Images by Getty Communications plc in March 1995, he served as its
Chairman.

Mark Torrance has been our non-executive Vice Chairman since September 1998
and a director since February 1998. From February 1998 until September 1998, Mr.
Torrance served as our Co-Chairman. Mr. Torrance co-founded PhotoDisc, Inc. in
1992 and served as its Chairman of the Board and Chief Executive Officer from
1992 to February 1998. Prior to founding PhotoDisc, Inc., Mr. Torrance served as
President of Muzak, Inc. from 1985 to 1987, and as President of Yesco from 1972
to 1985, both of which are foreground music distribution companies.

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<PAGE> 71

UNDERWRITERS

Under the terms and subject to the conditions contained in an underwriting
agreement dated the date hereof, the underwriters named below, for whom Morgan
Stanley & Co. Incorporated, BancBoston Robertson Stephens Inc., Deutsche Bank
Securities Inc., Hambrecht & Quist LLC and Pacific Crest Securities Inc. are
acting as representatives, have severally agreed to purchase, and we have agreed
to sell to them, severally, the number of shares indicated below:

<TABLE>
<CAPTION>
NUMBER OF
NAME SHARES
---- ---------
<S> <C>
Morgan Stanley & Co. Incorporated...........................
BancBoston Robertson Stephens Inc. .........................
Deutsche Bank Securities Inc. ..............................
Hambrecht & Quist LLC.......................................
Pacific Crest Securities Inc. ..............................

---------
Total..................................................... 5,000,000
=========
</TABLE>

The underwriters are offering the shares of common stock subject to their
acceptance of the shares from us and subject to prior sale. The underwriting
agreement provides that the obligations of the several underwriters to pay for
and accept delivery of the shares of common stock offered by this prospectus are
subject to the approval of certain legal matters by their counsel and to certain
other conditions. The underwriters are obligated to take and pay for all of the
shares of common stock offered by this prospectus if any such shares are taken.
However, the underwriters are not required to take or pay for the shares covered
by the over-allotment option described below.

The underwriters initially propose to offer part of the shares of common
stock directly to the public at the public offering price set forth on the cover
page hereof and part to certain dealers at a price that represents a concession
not in excess of $ a share under the public offering price. Any
underwriter may allow, and such dealers may reallow, a concession not in excess
of $ a share to other underwriters or to certain dealers. After the initial
offering of the shares of common stock, the offering price and other selling
terms may from time to time be varied by the representatives.

Pursuant to the underwriting agreement, we have granted to the underwriters
an option, exercisable for 30 days from the date of this prospectus, to purchase
up to an aggregate of 750,000 additional shares of common stock at the public
offering price set forth on the cover page of this prospectus, less underwriting
discounts and commissions. The underwriters may exercise such option solely for
the purpose of covering over-allotments, if any, made in connection with the
offering of the shares of common stock offered hereby. To the extent the option
is exercised, each underwriter will become obligated, subject to certain
conditions, to purchase approximately the same percentage of such additional
shares of common stock as the number listed next to such underwriter's name in
the preceding table bears to the total number of shares of common stock listed
next to the names of all underwriters in the preceding table.

We, the directors, officers and certain other of our stockholders have each
agreed that, without the prior written consent of Morgan Stanley & Co.
Incorporated on behalf of the underwriters, during the period ending 90 days
after the date of this prospectus, we will not, directly or indirectly:

- offer, pledge, sell, contract to sell, sell any option or contract to
purchase, purchase any option or contract to sell, grant any option,
right or warrant to purchase, lend or otherwise

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<PAGE> 72

transfer or dispose of, directly or indirectly, any shares of common stock or
any securities convertible into or exercisable or exchangeable for common stock;
or

- enter into any swap or other arrangement that transfers to another, in
whole or in part, any of the economic consequences of ownership of common
stock,

whether any such transaction described above is to be settled by delivery of
common stock or such other securities, in cash or otherwise.

The restrictions described in the previous paragraph do not apply to:

- the sale to the underwriters of the shares of common stock under the
underwriting agreement;

- the issuance by us of shares of common stock upon the exercise of an
option or a warrant or the conversion of a security outstanding on the
date of this prospectus which is described in the prospectus;

- transactions by any person other than us relating to shares of common
stock or other securities acquired in open market transactions after the
completion of the offering of the shares of common stock;

- sales to us by a person in connection with such person's termination,
removal or resignation as a director, officer or employee of our company;
or

- certain gifts and transfers by a person other than us, provided that the
donee or transferee agrees to be bound by the foregoing provisions and
such gift or transfer does not require the donor or transferor to file a
report of such transaction on Form 4 under the Exchange Act.

In order to facilitate the offering of the common stock, the underwriters
may engage in transactions that stabilize, maintain or otherwise affect the
price of the common stock. Specifically, the underwriters may over-allot in
connection with the offering, creating a short position in the common stock for
their own account. In addition, to cover over-allotments or to stabilize the
price of the common stock, the underwriters may bid for, and purchase, shares of
common stock in the open market. Finally, the underwriting syndicate may reclaim
selling concessions allowed to an underwriter or a dealer for distributing the
common stock in the offering, if the syndicate repurchases previously
distributed shares of common stock in transactions to cover syndicate short
positions, in stabilization transactions or otherwise. Any of these activities
may stabilize or maintain the market price of the common stock above independent
market levels. The underwriters are not required to engage in these activities,
and may end any of these activities at any time.

The underwriters or their affiliates have provided and may in the future
provide investment banking and other financial services for us in the ordinary
course of business for which they have received and will receive customary
compensation.

We and the underwriters have agreed to indemnify each other against certain
liabilities, including liabilities under the Securities Act.

LEGAL MATTERS

Certain legal matters with respect to the shares of the common stock
offered by this prospectus will be passed upon by Weil, Gotshal & Manges LLP,
Menlo Park, California and New York, New York. Latham & Watkins, Menlo Park,
California, is acting as counsel to the underwriters.

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<PAGE> 73

EXPERTS

The consolidated financial statements of Getty Images, Inc. and
subsidiaries and of its predecessor, Getty Communications plc and subsidiaries
as of December 31, 1998 and 1997 and for each of the three years in the period
ended December 31, 1998 included in this registration statement, have been so
included in reliance on the reports of PricewaterhouseCoopers, independent
accountants, given on the authority of said firm as experts in auditing and
accounting.

With respect to the unaudited consolidated financial statements of Getty
Images, Inc. and subsidiaries for the three-month periods ended March 31, 1999
and 1998, and for the three-month and six-month periods ended June 30, 1999 and
1998, incorporated in this Registration Statement by reference to the quarterly
reports on Form 10-Q for the quarters ended March 31, 1999 and June 30, 1999,
PricewaterhouseCoopers, reported that they have applied limited procedures in
accordance with professional standards for a review of such information.
However, their separate reports dated May 17, 1999 and August 16, 1999
incorporated by reference herein, state that they did not audit and they do not
express an opinion on that unaudited consolidated financial information.
Accordingly, the degree of reliance on their report on such information should
be restricted in light of the limited nature of the review procedures applied.
PricewaterhouseCoopers is not subject to the liability provisions of Section 11
of the Securities Act of 1933 for their reports on the unaudited consolidated
financial statements because those reports are not a "report" or a "part" of the
registration statement prepared or certified by PricewaterhouseCoopers within
the meaning of Sections 7 and 11 of the Act.

The consolidated financial statements of The Image Bank, Inc. as of and for
the year ended December 31, 1998 included in this Registration Statement have
been so included in reliance on the report of PricewaterhouseCoopers LLP,
independent accountants, given on the authority of said firm as experts in
auditing and accounting.

The financial statements of Art.Com, Inc. as of and for the year ended
December 31, 1998 incorporated in this Registration Statement by reference to
the quarterly report on Form 10-Q/A filed on July 16, 1999, have been audited by
Arthur Andersen LLP, independent public accountants, as indicated in their
report with respect thereto, and are incorporated in reliance upon the authority
of said firm as experts in auditing and accounting.

The consolidated financial statements of PhotoDisc, Inc. and subsidiaries
as of and for the year ended December 31, 1997 incorporated in this Registration
Statement by reference to the current report on Form 8-K/A filed on April 27,
1998, have been so incorporated in reliance on the report of
PricewaterhouseCoopers LLP, independent accountants, given on the authority of
said firm as experts in auditing and accounting.

The consolidated financial statements of PhotoDisc, Inc. and subsidiaries
as of December 31, 1996 and for each of the two years in the period ended
December 31, 1996 incorporated in this Registration Statement by reference to
the current report on Form 8-K filed on May 6, 1998, have been so incorporated
in reliance on the report of Deloitte & Touche LLP, independent accountants,
given on the authority of said firm as experts in auditing and accounting.

WHERE YOU CAN FIND MORE INFORMATION

We are subject to the informational requirements of the Exchange Act and in
accordance therewith files reports and other information with the Securities and
Exchange Commission. The reports and other information that we file with the SEC
can be inspected and copied at the public reference facilities maintained by the
SEC at Room 1024, 450 Fifth Street, N.W., Washington, D.C. 20549, and at the
Regional Offices of the SEC located at 7 World Trade Center, Room 1300, 13th
Floor, New York, NY 10048, and Citicorp Center, 500 West Madison Street, Suite
1400,

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<PAGE> 74

Chicago, IL 60661-2511. Copies of such material can also be obtained by mail
from the Public Reference Section of the SEC at 450 Fifth Street, N.W.,
Washington, D.C. 20549, at prescribed rates. Such reports and other information
are also available at a website maintained by the SEC that contains reports,
proxy and information statements and other information that registrants file
electronically with the SEC. The address of such site is: http://www.sec.gov. In
addition, such material may be inspected and copied at the offices of the
National Association of Securities Dealers, Inc., 1935 K Street, N.W.,
Washington, D.C. 20006. Our common stock is quoted on The Nasdaq National Market
under the symbol "GETY."

We have filed with the SEC a registration statement on Form S-3 under the
Securities Act with respect to the offering of the securities made hereby. This
prospectus does not contain all of the information set forth in the registration
statement, certain parts of which are omitted in accordance with the rules and
regulations of the SEC. For further information with respect to us, please see
our registration statement.

INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE

We have filed the following documents with the SEC which are incorporated
herein by reference:

1. Our Annual Report on Form 10-K for the fiscal year ended December
31, 1998;

2. Our Quarterly Report on Form 10-Q for the three months ended March
31, 1999;

3. Our amended Quarterly Report on Form 10-Q/A for the three months
ended March 31, 1999;

4. Our Definitive Proxy Statement on Schedule 14A filed on April 7,
1999;

5. Our Quarterly Report on Form 10-Q for the three months ended June
30, 1999;

6. Our Current Report on Form 8-K filed on September 27, 1999;

7. Our Current Report on Form 8-K filed on November 10, 1998;

8. Our Current Report on Form 8-K filed on May 6, 1998;

9. Our Current Report on Form 8-K/A filed on April 27, 1998; and

10. Our Form 8-A filed on February 9, 1998.

All documents filed by us pursuant to Sections 13(a), 13(c), 14 or 15(d) of
the Exchange Act after the date of the filing of the Registration Statement of
which this prospectus forms a part and prior to the date of the termination of
this offering shall be deemed to be incorporated by reference into this
prospectus and be a part of it from the dates of filing of these documents.

Any statement contained in a document incorporated or deemed to be
incorporated by reference into this prospectus shall be deemed to be modified or
superseded for purposes of this prospectus to the extent that a statement
contained in this prospectus, or in any other document filed subsequently with
the SEC which also is or is deemed to be incorporated by reference, modifies or
replaces that statement. Any such statement so modified or replaced shall not be
deemed, except as so modified or replaced, to constitute a part of this
prospectus.

We will furnish without charge to each person, including any beneficial
owner, to whom this prospectus is delivered, on the written or oral request of
such person, a copy of any or all of the documents incorporated by reference,
other than exhibits to such documents (unless such exhibits are specifically
incorporated by reference herein). Requests should be directed to Getty Images,
Inc., 2101 Fourth Avenue, Fifth Floor, Seattle, Washington 98121, Attention:
Suzanne L. Page (telephone: (206) 695-3400).

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GETTY IMAGES, INC. AND GETTY COMMUNICATIONS PLC (PREDECESSOR)

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS AND FINANCIAL
STATEMENT SCHEDULES

<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Report of Independent Accountants........................... F-2
Consolidated Statements of Operations for the period January
1 through December 31, 1998, 1997 and 1996................ F-3
Consolidated Balance Sheets at December 31, 1998 and
December 31, 1997......................................... F-4
Consolidated Statements of Stockholders' Equity at December
31, 1998 and December 31, 1997............................ F-5
Consolidated Statements of Comprehensive Income for the
period January 1 through December 31, 1998, 1997 and
1996...................................................... F-5
Consolidated Statements of Cash Flows for the period January
1 through December 31, 1998, 1997 and 1996................ F-6
Notes to Consolidated Financial Statements.................. F-7
</TABLE>

THE IMAGE BANK, INC.

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS AND FINANCIAL
STATEMENT SCHEDULES

<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Report of Independent Accountants........................... F-23
Consolidated Balance Sheet at December 31, 1998............. F-24
Consolidated Statement of Operations for the year ended
December 31, 1998......................................... F-25
Consolidated Statement of Cash Flows for the year ended
December 31, 1998......................................... F-26
Notes to Consolidated Financial Statements.................. F-27
</TABLE>

F-1
<PAGE> 76

GETTY IMAGES, INC. AND SUBSIDIARIES

REPORT OF INDEPENDENT ACCOUNTANTS

TO THE BOARD OF DIRECTORS AND SHAREHOLDERS OF GETTY IMAGES, INC.

In our opinion, the accompanying consolidated balance sheets and the
related consolidated statements of operations, comprehensive income,
stockholders' equity and cash flows present fairly, in all material respects,
the financial position of Getty Images, Inc. and subsidiaries (the "Company")
and of its predecessor, Getty Communications plc and subsidiaries, at December
31, 1998, and at December 31, 1997 and the results of their consolidated
operations and cash flows for each of the three years in the period ended
December 31, 1998, in conformity with generally accepted accounting principles.
These financial statements are the responsibility of the Company's management;
our responsibility is to express an opinion on these financial statements based
on our audits. We conducted our audits of these statements in accordance with
generally accepted auditing standards which require that we plan and perform the
audit to obtain reasonable assurance about whether the financial statements are
free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements,
assessing the accounting principles used and significant estimates made by
management, and evaluating the overall financial statement presentation. We
believe that our audits provide a reasonable basis for the opinion expressed
above.

PRICEWATERHOUSECOOPERS
Chartered Accountants
London, England
March 31, 1999

F-2
<PAGE> 77

GETTY IMAGES, INC. AND GETTY COMMUNICATIONS PLC (PREDECESSOR)

CONSOLIDATED STATEMENTS OF OPERATIONS

<TABLE>
<CAPTION>
GETTY
IMAGES, INC. GETTY COMMUNICATIONS PLC
------------ ----------------------------
YEAR ENDED YEAR ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31, DECEMBER 31,
1998 1997 1996
------------ ------------ ------------
(IN THOUSANDS EXCEPT PER SHARE DATA)
<S> <C> <C> <C>
Sales....................................... $185,084 $100,797 $ 85,014
Cost of sales............................... 52,830 37,514 32,156
-------- -------- --------
GROSS PROFIT................................ 132,254 63,283 52,858
-------- -------- --------
Selling, general and administrative
expenses.................................. 96,904 43,936 37,250
Amortization of intangibles................. 36,961 3,253 2,155
Depreciation................................ 14,397 8,214 5,486
Non-recurring integration and restructuring
costs..................................... 13,755 -- --
-------- -------- --------
162,017 55,403 44,891
-------- -------- --------
OPERATING (LOSS)/INCOME..................... (29,763) 7,880 7,967
Net interest (expense)/income............... (2,986) 1,187 (1,951)
Net exchange losses......................... (124) (198) (306)
Legal settlement............................ -- (974) --
-------- -------- --------
(LOSS)/INCOME BEFORE INCOME TAXES........... (32,873) 7,895 5,710
Income taxes................................ (2,680) (3,873) (2,982)
-------- -------- --------
(Loss)/income before extraordinary items.... (35,553) 4,022 2,728
Extraordinary items......................... (830) -- --
-------- -------- --------
NET (LOSS)/INCOME........................... $(36,383) $ 4,022 $ 2,728
======== ======== ========
BASIC (LOSS)/EARNINGS PER SHARE(2).......... $ (1.22) $ 0.11 $ 0.10
======== ======== ========
Extraordinary items......................... (0.03) -- --
-------- -------- --------
NET (LOSS)/EARNINGS PER SHARE(2)............ $ (1.25) $ 0.11 $ 0.10
======== ======== ========
Diluted earnings per share(2)............... $ N/A $ 0.10 $ 0.10
======== ======== ========
WEIGHTED AVERAGE SHARES OUTSTANDING:
Basic(3).................................. 29,160 37,908 27,442
======== ======== ========
Diluted(3)................................ N/A 38,765 27,832
======== ======== ========
</TABLE>

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

(1) As explained in the "Explanatory Note", the 1998 consolidated statement of
operations reflects the combination of the consolidated statement of
operations of Getty Communications plc (the predecessor company) for the
period January 1, 1998 through February 9, 1998 and the consolidated
statement of operations of Getty Images, Inc. for the period February 10,
1998 through December 31, 1998.

(2) The comparatives reflect the share structure of Getty Communications plc
(the predecessor company). See "Explanatory Note".

(3) The difference between basic and diluted weighted average shares in 1996 and
1997 results from the assumption that dilutive stock options outstanding
were exercised.

For pages F-3 to F-22, historic numbers are shown for Getty Communications plc,
the predecessor company of Getty Images, Inc. References to "sterling" or "L",
are to the lawful currency of the United Kingdom and references to "U.S.
dollars" or "$" are to the lawful currency of the United States.

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

F-3
<PAGE> 78

GETTY IMAGES, INC. AND GETTY COMMUNICATIONS PLC (PREDECESSOR)

CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>
GETTY IMAGES, INC. GETTY COMMUNICATIONS PLC
------------------ ------------------------
AT DECEMBER 31, AT DECEMBER 31,
1998 1997
------------------ ------------------------
(IN THOUSANDS)
<S> <C> <C>
ASSETS
CURRENT ASSETS
Cash and cash equivalents.................. $ 16,150 $ 29,234
Accounts receivable, net................... 32,967 23,431
Inventories, net........................... 2,834 --
Prepaid expenses and other assets.......... 17,258 7,839
-------------- -----------------
TOTAL CURRENT ASSETS....................... 69,209 60,504
Fixed assets, net.......................... 62,757 39,853
Intangible assets, net..................... 325,861 66,870
Deferred tax assets........................ 5,036 4,411
-------------- -----------------
TOTAL ASSETS............................... $462,863 $171,638
-------------- -----------------
-------------- -----------------
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable........................... 26,232 21,461
Accrued expenses........................... 20,148 10,305
Income taxes payable....................... -- 3,580
Current portion of long-term debt.......... 202 2,096
-------------- -----------------
TOTAL CURRENT LIABILITIES.................. 46,582 37,442
Long-term debt............................. 72,354 14,657
-------------- -----------------
TOTAL LIABILITIES.......................... 118,936 52,099
-------------- -----------------
COMMITMENTS AND CONTINGENCIES (NOTE 15)
STOCKHOLDERS' EQUITY
Common stock............................... 306 608
Shares of common stock: par value $0.01 per
share, issued 30,574,792 at December 31,
1998;
Class 'A' shares: par value L0.01 per
share; issued 24,872,608 shares at
December 31, 1997;
Class 'B' shares: par value L0.01 per
share; issued 13,444,618 shares at
December 31, 1997
Additional paid-in capital................. 368,267 108,049
Retained (deficit)/earnings................ (28,259) 8,124
Cumulative translation adjustments......... 3,613 2,758
-------------- -----------------
TOTAL STOCKHOLDERS' EQUITY................. 343,927 119,539
-------------- -----------------
TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY................................... $462,863 $171,638
-------------- -----------------
-------------- -----------------
</TABLE>

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

F-4
<PAGE> 79

GETTY IMAGES, INC. AND GETTY COMMUNICATIONS PLC (PREDECESSOR)

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

<TABLE>
<CAPTION>
GETTY
GETTY IMAGES,
COMMUNICATIONS PLC INC.
--------------------- ---------
NO. OF NO. OF SHARES OF
A ORD. B ORD. COMMON
SHARES SHARES STOCK
L0.01 L0.01 $0.01 ADDITIONAL RETAINED CUMULATIVE
PAR PAR PAR COMMON PAID IN EARNINGS/ TRANSLATION
VALUE VALUE VALUE STOCK CAPITAL (DEFICIT) ADJUSTMENTS TOTAL
--------- --------- --------- ------ ---------- --------- ----------- --------
(IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
BALANCE AT DECEMBER
31, 1996........... 23,943 13,445 -- $593 $101,464 $ 4,102 $ 7,364 $113,523
Issue of shares to
sellers of
Liaison............ 312 -- -- 5 2,595 -- -- 2,600
Issue of shares to
sellers of
Energy............. 618 -- -- 10 3,990 -- -- 4,000
Net income........... -- -- -- -- -- 4,022 -- 4,022
Translation
adjustments........ -- -- -- -- -- -- (4,606) (4,606)
------- ------- ------ ---- -------- -------- ------- --------
BALANCE AT DECEMBER
31, 1997........... 24,873 13,445 -- $608 $108,049 $ 8,124 $ 2,758 $119,539
Capital
restructuring...... (24,873) (13,445) 19,159 (416) 416 -- -- --
Getty Investments
Subscription....... -- -- 1,519 15 27,985 -- -- 28,000
Issue of shares to
sellers of
PhotoDisc.......... -- -- 8,084 81 201,401 -- -- 201,482
Issue of shares to
sellers of
Allsport........... -- -- 1,138 11 23,203 -- -- 23,214
Issue of shares for
other
acquisitions....... -- -- 52 1 983 -- -- 984
Options exercised.... -- -- 623 6 6,230 -- -- 6,236
Net loss............. -- -- -- -- -- (36,383) -- (36,383)
Translation
adjustments........ -- -- -- -- -- -- 855 855
------- ------- ------ ---- -------- -------- ------- --------
BALANCE AT DECEMBER
31, 1998........... -- -- 30,575 $306 $368,267 $(28,259) $ 3,613 $343,927
======= ======= ====== ==== ======== ======== ======= ========
</TABLE>

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

<TABLE>
<CAPTION>
GETTY IMAGES, INC. GETTY COMMUNICATIONS PLC
------------------ ------------------------------
YEAR ENDED YEAR ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31, DECEMBER 31,
1998 1997 1996
------------------ ------------ --------------
(IN THOUSANDS)
<S> <C> <C> <C>
Net (loss)/income.............................. $(36,383) $4,022 $ 2,728
Other comprehensive income, net of tax:
Foreign currency translation adjustments....... 855 (4,606) 7,975
-------- ------ -------
Comprehensive (loss)/income.................... $(35,528) $ (584) $10,703
======== ====== =======
</TABLE>

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

F-5
<PAGE> 80

GETTY IMAGES, INC. AND GETTY COMMUNICATIONS PLC (PREDECESSOR)

CONSOLIDATED STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
GETTY IMAGES, INC. GETTY COMMUNICATIONS PLC
------------------ ----------------------------
YEAR ENDED YEAR ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31, DECEMBER 31,
1998(1) 1997 1996
------------------ ------------ ------------
(IN THOUSANDS)
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net (loss)/income...................... $ (36,383) $ 4,022 $ 2,728
Adjustments to reconcile net
(loss)/income to net cash provided by
operating activities:
Depreciation and amortization.......... 51,358 11,467 7,641
Bad debt expense....................... 412 536 510
Other items............................ 4,291 113 87
CHANGE IN ASSETS AND LIABILITIES, NET
OF EFFECTS OF BUSINESS ACQUISITIONS:
Accounts receivable.................... (2,359) (2,385) (1,275)
Accounts payable....................... (2,690) 919 1,483
Accrued expenses....................... 2,094 2,257 463
Inventory.............................. (1,758) -- --
Other assets........................... (7,743) (3,755) 1,865
--------------- ----------- -----------
NET CASH PROVIDED BY OPERATING
ACTIVITIES........................... 7,222 13,174 13,502
--------------- ----------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Business acquisitions, net of cash
acquired............................. (80,564) (20,546) (18,402)
Purchase of fixed assets............... (27,305) (14,901) (7,154)
Proceeds from sale of fixed assets..... -- -- 28
--------------- ----------- -----------
NET CASH USED IN INVESTING
ACTIVITIES........................... (107,869) (35,447) (25,528)
--------------- ----------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds of debt....................... 123,168 -- 17,084
Payments on principal balance of
debt................................. (67,153) (3,052) (26,582)
Capital contribution................... -- -- 124
Proceeds from issuance of ordinary
shares............................... 33,306 -- 75,685
Debt issue costs....................... (4,318) -- --
--------------- ----------- -----------
NET CASH PROVIDED BY/(USED IN)
FINANCING ACTIVITIES................. 85,003 (3,052) 66,311
--------------- ----------- -----------
Exchange rate differences arising from
translation of foreign currency
balances............................. 2,560 (4,380) 2,755
Net (decrease)/increase in cash and
cash equivalents..................... (13,084) (29,705) 57,040
Cash and cash equivalents:
-- beginning of period............... 29,234 58,939 1,899
--------------- ----------- -----------
-- end of period..................... $ 16,150 $ 29,234 $ 58,939
--------------- ----------- -----------
--------------- ----------- -----------
SUPPLEMENTAL DISCLOSURES
Interest paid.......................... $ 2,314 $ 1,688 $ 2,305
Income taxes paid...................... $ 6,387 $ 769 $ 3,396
--------------- ----------- -----------
--------------- ----------- -----------
</TABLE>

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

(1) Reflects the combination of the consolidated statement of cash flows of
Getty Communications plc (the predecessor company) for the period January
1, 1998 through February 9, 1998 and the consolidated statement of cash
flows of Getty Images, Inc. for the period February 10, 1998 through
December 31, 1998. See "Explanatory Note".

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

F-6
<PAGE> 81

GETTY IMAGES, INC. AND GETTY COMMUNICATIONS PLC (PREDECESSOR)

1. BASIS OF PRESENTATION AND ACCOUNTING POLICIES

Explanatory note. On February 9, 1998, the entire issued share capital of
Getty Communications plc ("Getty Communications") was acquired via a Scheme of
Arrangement by Getty Images, Inc. ("Getty Images" or the "Company"), a company
incorporated in Delaware and whose principal executive offices are located in
Seattle, Washington and London, England. Under the Scheme of Arrangement, each
issued Getty Communications Class B Ordinary Share was converted into one Getty
Communications Class A Ordinary Share and each holder of Getty Communications
Class A Ordinary Shares was issued one share of Getty Images Common Stock, par
value $0.01 ("Common Stock") for every two Getty Communications Class A Ordinary
Shares held.

The Scheme of Arrangement was accounted for as a transaction between
entities under common control, therefore purchase accounting was not applied.

On February 9, 1998, a wholly-owned subsidiary of Getty Images acquired
PhotoDisc, Inc., a Washington corporation ("PhotoDisc"). The purchase
consideration was $245.7 million, including expenses, which included the issue
of 8,083,831 shares of Getty Images Common Stock, at a total market value of
$171.8 million.

Also on February 9, 1998, Getty Investments LLC ("Getty Investments"), a
company registered in Delaware and resident in Jersey, completed a subscription
for 1,518,644 shares of Getty Images Common Stock at a purchase price of
$18.4375 per share or an aggregate of $28 million (the "Getty Investments
Subscription"). At December 31, 1998, Getty Investments held a 26.3 percent
interest in the share capital of the Company.

On February 10, 1998, Getty Images purchased the entire issued and
outstanding share capital of Allsport Photographic plc, a public limited company
organized under the laws of England & Wales ("Allsport"). The purchase
consideration was $51.1 million, including expenses, which included the issue of
1,137,916 shares of Getty Images Common Stock, at a total market value of $24.2
million.

Descriptions of these transactions were included in the Current Report on
Form 8-K dated February 9, 1998 and the Current Report on Form 8-K dated
February 24, 1998 (as amended by the Amendment to Current Report on Form 8-K/A
dated April 27, 1998), filed with the Securities and Exchange Commission (the
"Commission") by Getty Images and the Registration Statement on Form S-4 (No.
333-38777) that the Company filed with the Commission in connection with the
meetings of the stockholders of Getty Communications and the special meetings of
the stockholders of PhotoDisc that were required to approve the transactions and
the offering of securities in connection therewith.

As a result of such transactions, Getty Images became the successor to
Getty Communications. Trading in Getty Communications American Depository Shares
("ADSs") on the Nasdaq National Market (NASDAQ:GETTY) terminated on February 9,
1998 and trading subsequently commenced in shares of Getty Images Common Stock
on the NASDAQ National Market (NASDAQ:GETY). Registration of the Getty
Communications Ordinary Shares and ADSs under the Securities Exchange Act of
1934, as amended, has been terminated.

ACTIVITIES

The principal business of Getty Images and its subsidiaries is the
marketing of reproduction rights to still and moving images. These rights are
marketed in many countries throughout the world through the Company's Web sites
and through its international network of wholly-owned offices and agents.

F-7
<PAGE> 82
GETTY IMAGES, INC. AND GETTY COMMUNICATIONS PLC (PREDECESSOR)

1. BASIS OF PRESENTATION AND ACCOUNTING POLICIES (CONTINUED)
BASIS OF PRESENTATION

The consolidated financial statements, which have been prepared in
accordance with accounting principles generally accepted in the United States,
present the consolidated financial statements of Getty Images and subsidiaries
and the consolidated financial statements of its predecessor, Getty
Communications and subsidiaries. The Company's consolidated financial statements
include Getty Images and its subsidiaries, all of which are 100 percent owned.
Companies acquired during a period are consolidated from the date of
acquisition. All material intercompany amounts and transactions have been
eliminated in the consolidated financial statements.

TRANSLATION OF FOREIGN SUBSIDIARY FINANCIAL STATEMENTS

The Company records all transactions in the currency of the respective
primary economic environments in which they operate.

The assets and liabilities of non-U.S. subsidiaries are translated into
U.S. dollars at exchange rates as of the balance sheet date, and income and
expense items are translated at the average of the rates prevailing during the
period. Gains or losses from translating foreign currency financial statements
are accumulated as a separate component of stockholders' equity.

ACCOUNTING ESTIMATES

The preparation of financial statements in conformity with accounting
principles generally accepted in the United States requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the reported period. Accounting estimates have been employed in these
financial statements to determine reported amounts, including realizability of
receivables and other assets, useful lives of assets, income taxes and the fair
value of financial instruments. Actual results could differ from those
estimates.

CASH AND CASH EQUIVALENTS

The Company considers cash and demand bank deposits to be cash. Cash
equivalents consist of all deposits with an original maturity of three months or
less.

REVENUE RECOGNITION

Sales are recognized when a license agreement has been completed with the
customer for the use of the image and pricing terms, and the image has been made
available to the customer for use. Pricing terms do not call for additional fees
beyond the fixed license amount. Additionally, the customer is contractually
obligated to pay the fixed license amount upon agreement of the license terms
and availability of the image for use by the customer. In the case of royalty
free sales, revenue is recognized upon the sale of the CD ROM or at the time
images are downloaded by the customer. Circumstances in which sales are refunded
are rare and are taken into account in the recognition of revenue. Sales are
recorded at invoiced amounts less sales tax.

INVENTORIES

Inventories are valued at the lower of cost or market value. Inventories
consist of physical materials and finished goods, such as resource books, CD
ROMs and packaging materials. Inventories are reviewed periodically for
obsolescence.
F-8
<PAGE> 83
GETTY IMAGES, INC. AND GETTY COMMUNICATIONS PLC (PREDECESSOR)

1. BASIS OF PRESENTATION AND ACCOUNTING POLICIES (CONTINUED)
CATALOG COSTS

The Company produces both general catalogs, that are issued annually, and
specialist catalogs, that are topical in nature and distributed over a longer
period. Costs relating to the production of catalogs are expensed over their
estimated useful life, up to three years from the date on which they are
available for distribution to customers.

FIXED ASSETS

Fixed assets are stated at cost. The cost of acquired fixed assets includes
the purchase cost, together with any incidental expenses of acquisition. All
costs associated with the production of image duplicates are capitalized. The
cost of purchased software is capitalized and amortized from the implementation
date over its estimated useful economic life. The cost of internally developed
software is capitalized in accordance with Statement of Position 98-1,
"Accounting for the Costs of Computer Software Developed or Obtained for
Internal Use", and amortized from the implementation date over its estimated
useful economic life. The value of fixed assets is reviewed annually for
impairments in value.

Depreciation rates have been established to expense the cost of fixed
assets, less their estimated residual values, over their expected useful lives.
Depreciation is calculated at the following annual rates:

<TABLE>
<S> <C>
Archival picture collection................................. 2.5%
Fixtures, fittings, office and studio equipment............. 10 to 20%
Computer hardware........................................... 33%
Computer software (including internally developed
software)................................................. 25 to 33%
Image duplicates and digitization........................... 25%
</TABLE>

INTANGIBLE ASSETS

Goodwill and other intangibles are amortized on a straight-line basis over
their estimated lives not to exceed 40 years. The value of goodwill and other
intangibles is reviewed annually in relation to the operating performance and
future undiscounted cash flows of the underlying businesses, and a charge to the
consolidated statement of operations is made where a permanent diminution in
value is identified.

TAXES

Deferred tax assets and liabilities are provided for all temporary
differences between financial and tax reporting. As a matter of policy, deferred
tax assets are reduced by a valuation allowance if based on the weight of
available evidence it is more likely than not that some portion or all of the
deferred tax assets will not be realized. Deferred tax assets and liabilities
are classified into a net current amount and a net non-current amount, based on
the balance sheet classification of the related asset or liability.

PENSIONS

The Company contributes to defined contribution pension schemes for certain
directors and employees. Contributions are recognized as an expense in the
period in which they are incurred.

F-9
<PAGE> 84
GETTY IMAGES, INC. AND GETTY COMMUNICATIONS PLC (PREDECESSOR)

1. BASIS OF PRESENTATION AND ACCOUNTING POLICIES (CONTINUED)
LEASES

Under capital leasing arrangements, the present value of the future minimum
lease payments payable over the lease term is recorded as a fixed asset. The
corresponding leasing commitments are shown as amounts payable to the lessor.
Depreciation of leased assets is charged to the statement of operations over the
shorter of the lease term or the useful lives of equivalent owned assets.

Other leases are treated as operating leases. Annual rentals are charged to
the income statement on a straight-line basis over the term of the lease.

FINANCIAL INSTRUMENTS

Forward exchange contracts hedging firm commitments relating to trade and
other balances are recorded as hedges. Unrealized gains or losses are expensed.

The Company does not issue or hold financial instruments for trading
purposes.

EARNINGS PER SHARE

Basic and diluted earnings per share (EPS) are computed in accordance with
FAS No. 128, "Earnings per Share", which is effective for fiscal periods ending
after December 15, 1997. Prior periods have been restated to conform with the
provisions of this standard.

Basic (loss)/earnings per share is computed on the basis of weighted
average number of shares in issue. Diluted earnings per share are not given for
the year ended December 31, 1998 due to the loss incurred in that period.

2. RECENTLY ISSUED ACCOUNTING STANDARDS

In June 1998, the Financial Accounting Standards Board issued SFAS 133,
"Accounting for Derivative Instruments and Hedging Activities". The standard
requires that an entity recognize all derivatives as either assets or
liabilities and measure those instruments at fair value. The new rules will be
effective for fiscal years beginning after June 15, 1999. The Company does not
believe that the new standard will have a material impact on reporting segments.

3. NON-RECURRING INTEGRATION AND RESTRUCTURING COSTS

During the year ended December 31, 1998, the Company approved and commenced
a program to integrate its businesses following the acquisitions of PhotoDisc
and Allsport. This has resulted in integration and restructuring charges.

Integration costs in the year ended December 31, 1998 amounted to $3.7
million and are associated with the activities of teams responsible for
integrating the various businesses of the Company for the benefit of future
operations. These include items such as consulting and professional fees,
systems and process integration costs and contract renegotiation costs. These
costs are expensed as incurred.

Restructuring costs, which amounted to $10.1 million in the year ended
December 31, 1998, were for estimated exit costs associated with the closure of
10 facilities, asset write downs, employee termination costs and contract
termination costs.

F-10
<PAGE> 85
GETTY IMAGES, INC. AND GETTY COMMUNICATIONS PLC (PREDECESSOR)

3. NON-RECURRING INTEGRATION AND RESTRUCTURING COSTS (CONTINUED)
Non-recurring integration and restructuring costs have been incurred as
follows:

<TABLE>
<CAPTION>
GETTY IMAGES, INC.
--------------------------------
DECEMBER 31, 1998
--------------------------------
CHARGE UTILIZED PROVISION
------- -------- ---------
(IN THOUSANDS)
<S> <C> <C> <C>
INTEGRATION COSTS
Consulting and professional fees................... $ 1,167 $(1,017) $ 150
Systems and process integration costs.............. 1,891 (1,847) 44
Contract renegotiation costs....................... 622 (165) 457
------- ------- -------
$ 3,680 $(3,029) $ 651
------- ------- -------
RESTRUCTURING COSTS
Property exit costs................................ $ 1,406 $ (191) $ 1,215
Asset write downs.................................. 3,182 (2,732) 450
Employee termination costs......................... 4,026 (3,598) 428
Contract termination costs......................... 1,461 (94) 1,367
------- ------- -------
$10,075 $(6,615) $ 3,460
------- ------- -------
$13,755 $(9,644) $ 4,111
======= ======= =======
</TABLE>

Total amounts utilised comprised $7.0 million of cash expenditure and $2.6
million of non-cash write offs. It is anticipated that the majority of the
provision at December 31, 1998 will be used by December 31, 1999.

4. EXTRAORDINARY ITEMS

On May 22, 1998, the Company completed the issue of $75 million, 4.75%
convertible subordinated notes due 2003, the proceeds of which were applied
partially to the repayment of $49 million of term debt due to Midland Bank plc.
The early payment of such debt resulted in an extraordinary charge of $830,000
($0.03 per share) net of an income tax benefit of $408,000.

5. INVENTORIES

Inventories at December 31, 1998, are stated net of a $100,000 provision
(1997: $nil).

6. FIXED ASSETS

<TABLE>
<CAPTION>
GETTY IMAGES, INC. GETTY COMMUNICATIONS PLC
------------------ ------------------------
DECEMBER 31, DECEMBER 31,
1998 1997
------------------ ------------------------
(IN THOUSANDS)
<S> <C> <C>
Fixtures, fittings, office and studio
equipment................................ $ 23,334 $ 10,175
Computer hardware and software............. 29,678 13,206
Image duplicates and digitization.......... 36,287 20,023
Archival picture collection................ 15,714 15,847
Other fixed assets......................... 6,157 4,451
-------- --------
Total...................................... 111,170 63,702
Less accumulated depreciation.............. (48,413) (23,849)
-------- --------
Fixed assets, net.......................... $ 62,757 $ 39,853
======== ========
</TABLE>

F-11
<PAGE> 86
GETTY IMAGES, INC. AND GETTY COMMUNICATIONS PLC (PREDECESSOR)

6. FIXED ASSETS (CONTINUED)
The net book value of fixed assets includes $1,601,000 and $796,000 in
respect of assets held under capital leases at December 31, 1998 and 1997,
respectively. The charge to income resulting from depreciation of assets held
under capital leases, the majority of which form part of "other fixed assets",
is included within the depreciation expense in the consolidated statements of
operations. The accumulated depreciation of assets held under capital leases was
$1,213,000 (1997: $983,000).

7. INTANGIBLE ASSETS

<TABLE>
<CAPTION>
GETTY IMAGES, INC. GETTY COMMUNICATIONS PLC
------------------ ------------------------
DECEMBER 31, DECEMBER 31,
1998 1997
------------------ ------------------------
(IN THOUSANDS)
<S> <C> <C>
Cost....................................... $372,222 $76,270
Less accumulated amortization.............. (46,361) (9,400)
-------- -------
$325,861 $66,870
======== =======
</TABLE>

Intangible assets primarily consist of goodwill arising upon the
acquisition of companies and other businesses. Additions to goodwill arose
principally from the acquisitions of Liaison Inc. and Energy Film Library Inc.
in the year to December 31, 1997 and PhotoDisc and Allsport in the year to
December 31, 1998. Additional information on these acquisitions is set out in
Note 21.

8. ACCOUNTS RECEIVABLE

Accounts receivable comprise solely of receivables from customers.
Receivables are stated net of a provision for doubtful accounts of $4.8 million
and $2.8 million at December 31, 1998 and 1997, respectively. The Company has a
diverse customer base and is not dependent on any one customer.

9. PREPAID EXPENSES AND OTHER ASSETS

Prepaid expenses and other assets include deferred catalog costs of $6.6
million and $3.0 million at December 31, 1998 and 1997, respectively. Catalog
costs expensed in the periods ended December 31, 1998, 1997 and 1996 were $2.7
million, $1.5 million and $1.3 million, respectively.

10. SHORT-TERM BORROWINGS

At December 31, 1998 the Company had an unutilized credit facility of L2.0
million with Midland Bank plc. This facility is unsecured. Interest on the
facility is at a variable rate comprising the aggregate of a margin and Midland
Bank Rate ("MBR"). As of December 31, 1998, the margin was 1.0% and the MBR was
6.25%.

F-12
<PAGE> 87
GETTY IMAGES, INC. AND GETTY COMMUNICATIONS PLC (PREDECESSOR)

11. LONG-TERM DEBT

<TABLE>
<CAPTION>
GETTY IMAGES, INC. GETTY COMMUNICATIONS PLC
------------------ ------------------------
DECEMBER 31, DECEMBER 31,
1998 1997
------------ ------------
(IN THOUSANDS)
<S> <C> <C>
4.75% convertible subordinated notes due
2003..................................... $71,832 --
Bank loans................................. -- $16,342
Other loans................................ 34 --
Capital leases............................. 690 411
------- -------
72,556 16,753
Less current portion....................... (202) (2,096)
------- -------
Total long-term debt....................... $72,354 $14,657
======= =======
</TABLE>

The amounts outstanding at December 31, 1998 are payable as follows:

<TABLE>
<CAPTION>
CONVERTIBLE
SUBORDINATED
NOTES LOANS CAPITAL LEASES TOTAL
------------ ----- -------------- -------
(IN THOUSANDS)
<S> <C> <C> <C> <C>
1999................................ -- -- $202 $ 202
2000................................ -- $34 488 522
2001................................ -- -- -- --
2002................................ -- -- -- --
2003................................ $71,832 -- -- 71,832
------- --- ---- -------
Total............................... $71,832 $34 $690 $72,556
======= === ==== =======
</TABLE>

On May 20, 1998, the Company completed the issue of $75 million convertible
subordinated notes due 2003 (the "Notes"). These Notes carry a coupon of 4.75%
and are convertible into 2,600,000 shares of Common Stock of the Company at a
conversion price of $28.51 per share, subject to adjustments in certain
circumstances. The Notes are general unsecured subordinated obligations of the
Company. The funds raised were principally used to repay $49 million of term
debt, and to fund further investment in digitization and e-commerce. Issue costs
of $3.6 million were incurred in obtaining the Notes and have been offset
against the Notes. These costs are being amortized over the term of the Notes.

CAPITAL LEASES

Obligations under capital leases are collateralized by the respective
assets financed.

INTEREST EXPENSE

The interest expense relating to short and long-term borrowings amounted to
$2.6 million in 1998 (1997: $1.5 million).

12. SHARE OPTION PLANS

Executive directors and all employees of the Company were eligible to
participate in the Getty Communications Option Plan ("the Option Plan") under
which market and premium options over a total of 6,159,890 Class A Shares could
be issued. Options vest in equal proportions on each anniversary of the date of
grant over a five year period from the date of grant. Market options became
exercisable, to the extent vested, after three years from the date of grant and
lapse

F-13
<PAGE> 88
GETTY IMAGES, INC. AND GETTY COMMUNICATIONS PLC (PREDECESSOR)

12. SHARE OPTION PLANS (CONTINUED)
seven years from the date of the grant. Premium options become exercisable when
vested and remain exercisable for a period of two years after vesting.
Generally, options awarded under the Option Plan could not be exercised prior to
vesting, except under certain limited circumstances including a change of
control.

On July 2, 1996, market options over 2,793,960 Class A Shares were granted
under the Option Plan at an exercise price of $5.00 per share. Additionally,
premium options over 1,561,980 Class A Shares were granted under the Option Plan
at an exercise price of $8.05 per share.

On March 14, 1997, market options over 11,994 Class A Shares were granted
under the Option Plan at an exercise price of $6.81 per share and premium
options were granted over 11,994 Class A Shares at an exercise price of $10.97
per share. Additionally, on May 15, 1997, market options were granted over
215,204 Class A Shares at an option price of $6.81 per Class A Share and premium
options over 215,204 Class A Shares at an option price of $10.97 per share.

Under the Scheme of Arrangement, the existing Options granted by Getty
Communications were vested immediately, with the right to exercise the options
for a period of three months from February 17, 1998, which was subject to
extension at the discretion of the Company. As an alternative to exercising
Options, option holders had the right to exchange their existing Options for
Getty Communications Class A Ordinary Shares for new Options for Getty Images
Common Stock at a ratio of 2 for 1 with an appropriate adjustment to exercise
price, but with the terms otherwise unchanged. As of December 31, 1998, 468,332
options over Getty Images Common Stock were exercised and the remainder were
exchanged for new options over Getty Images Common Stock.

Pursuant to the acquisition of PhotoDisc, all outstanding options over
PhotoDisc Common Stock were assumed by Getty Images on an agreed basis. This
resulted in the issuance of 1.8 million options over Getty Images Common Stock
to former PhotoDisc option holders.

On February 8, 1998, the Board approved the establishment of the Getty
Images, Inc. Stock Incentive Plan (the "Getty Images Plan").

Under the Getty Images Plan, the Board has the discretion to grant stock
options ("Options") underlying shares of Common Stock at fair market prices,
based on the average of the high and low prices of the Company's Common Stock on
the date of grant. The Options vest 25% on the first anniversary of the date of
grant and on a monthly pro rata basis over three years thereafter and have a
term of ten years.

Executive directors, officers, consultants and all employees of the Company
are eligible to participate in the Getty Images Plan under which a total of
10,000,000 shares may be issued. Options which lapse will cease to be counted
toward this limit. Options become exercisable when vested and remain exercisable
through the remainder of the option term except upon termination of employment,
in which case the Options will terminate 90 days after the termination date.

Options granted under the Getty Images Plan in the year to December 31, 1998,
were as follows:

<TABLE>
<CAPTION>
GRANT DATE NUMBER EXERCISE PRICE
- ---------- --------- ----------------
<S> <C> <C>
February 9, 1998.................................... 2,701,863 $20.91
April 1, 1998....................................... 81,000 $25.88
June 2, 1998........................................ 240,500 $19.22
August 31, 1998..................................... 192,500 $15.32
September 8, 1998................................... 539,000 $14.94
September 9 - December 15, 1998..................... 356,500 $11.69 to $17.57
</TABLE>

F-14
<PAGE> 89
GETTY IMAGES, INC. AND GETTY COMMUNICATIONS PLC (PREDECESSOR)

12. SHARE OPTION PLANS (CONTINUED)
Options outstanding under the Getty Images Plan at December 31, 1998, are
analyzed by exercised price below, as follows:

<TABLE>
<CAPTION>
OPTIONS OUTSTANDING
(NUMBER) EXERCISE PRICE
------------------- ----------------
<S> <C> <C>
978,428....... $ .18 to $ 5.00
1,511,304..... $ 5.01 to $10.00
872,372....... $10.01 to $15.00
1,196,333..... $15.01 to $20.00
2,851,025..... $20.01 to $26.86
</TABLE>

The Company applies Accounting Principles Board Opinion No. 25 ("APB No.
25"), Accounting for Stock Issued to Employees and related interpretations in
accounting for its stock option plans. In accordance with APB No. 25, no
compensation expense has been recognized for such plans. The pro forma effect on
the Company's net income and earnings per share, had compensation costs for the
Company's stock option plans been determined based upon the fair market value at
the date of grant for awards under these plans consistent with the methodology
prescribed under Statement of Financial Accounting Standards ("FAS") No. 123,
Accounting for Stock-Based Compensation, is as follows: the net loss would have
increased by approximately $6.3 million to $42.7 million and the loss per share
would have increased by $0.22 to $1.47 per share. Net income for 1997 and 1996
would have been reduced by approximately $2.2 million and $1.2 million to $1.8
million and $1.5 million respectively. Earnings per share would have been
reduced by $0.05 to $0.05 per share and by $0.05 to $0.05 per share, in the
years ended December 31, 1997 and 1996 respectively.

The fair value of the Options granted during 1998 is estimated at $47.3
million on the date of grant using the Black-Scholes option pricing model with
the following assumptions: no dividends are paid, volatility of 65 percent,
risk-free interest rate range of 3.94% to 5.71%, assumed forfeiture rate of nil
percent and expected life of 4 years.

13. INCOME TAXES

The components of income before taxes and income tax expense are as
follows:

F-15
<PAGE> 90
GETTY IMAGES, INC. AND GETTY COMMUNICATIONS PLC (PREDECESSOR)

13. INCOME TAXES (CONTINUED)
The provisions differ from the amounts that would result by applying the
United States (United Kingdom in 1996 and 1997) statutory rate to earnings
before taxes. A reconciliation of the difference is:

The deferred tax assets in respect of loss carry forwards as at December
31, 1998 expire as follows:

<TABLE>
<CAPTION>
(IN THOUSANDS)
--------------
<S> <C>
2001........................................................ $ 185
2002........................................................ 476
2003........................................................ 138
2005........................................................ 31
2012........................................................ 112
2013........................................................ 487
Indefinite.................................................. 2,683
------
$4,112
======
</TABLE>

14. DEFINED CONTRIBUTION PLANS

The costs recognized by the Company with respect to its defined
contribution plans are as follows:

F-16
<PAGE> 91
GETTY IMAGES, INC. AND GETTY COMMUNICATIONS PLC (PREDECESSOR)

14. DEFINED CONTRIBUTION PLANS (CONTINUED)
The Company runs two pension plans in the United Kingdom. Under the terms
of the schemes, all employees are entitled to join one of the plans after six
months' service with the Company. Under the first scheme, the Company
contributes 6% of each participatory employee's salary to the plan and
contributes 5% under the second scheme. The employees contribute 4% of their
salary under the first scheme and 5% under the second.

The Company's U.S. subsidiaries operate three separate 401(k) pension plans
for their employees. Under the terms of the first plan, employees over 18 years
old are immediately eligible to participate. The Company contributes 40% of up
to 5% of the employee's contribution. Under the terms of the second plan,
employees over 21 years old are immediately eligible to participate. The Company
contributes 40% of up to 5% of the employee's contributions. Under the terms of
the third plan, employees over 21 years old are eligible to participate after 6
months service (however, only at entry periods of January 1 and July 1). The
Company contributes 25% of up to 3% of the employee's contribution.

15. COMMITMENTS AND CONTINGENCIES

The Company's commitments under capital leases as of December 31, 1998 are
as follows:

<TABLE>
<CAPTION>
(IN THOUSANDS)
--------------
<S> <C>
Minimum rental payments:
1999...................................................... $226
2000...................................................... 546
----
Total....................................................... 772
Less imputed interest cost.................................. (82)
----
Present value of minimum lease payments..................... $690
====
</TABLE>

The Company's commitments under operating leases as of December 31, 1998 are as
follows:

<TABLE>
<CAPTION>
(IN THOUSANDS)
--------------
<S> <C>
Minimum rental payments:
1999...................................................... $2,028
2000...................................................... 1,955
2001...................................................... 1,905
2002...................................................... 1,894
2003...................................................... 663
After 2003................................................ 1,235
------
Total....................................................... $9,680
======
</TABLE>

Rent expense amounted to $4.8 million in the year to December 31, 1998,
$3.1 million in the year to December 31, 1997 and $2.3 million in the year to
December 31, 1996.

From time to time the Company is subject to various legal actions arising
out of the normal course of business including claims relating to trademark,
patent or copyright infringements or other items. Management believes the
outcome of any such actions and claims will not materially affect these
consolidated financial statements.

F-17
<PAGE> 92
GETTY IMAGES, INC. AND GETTY COMMUNICATIONS PLC (PREDECESSOR)

16. FINANCIAL INSTRUMENTS

The Company operates internationally, giving rise to exposure to market
risks from changes in foreign exchange rates. The Company hedges only its
contracted net receivables and payables using a variety of financial
instruments. The Company does not issue or hold financial instruments for
trading purposes.

For accounting purposes, financial instruments relating to trade and other
balances and which are specifically identified are accounted for as hedges.
Gains and losses from hedging firm commitments are expensed as incurred.

The Company is exposed to credit losses in the event of non-performance by
counterparties to financial instruments, but considers this risk to be minimal.

Outstanding off-balance sheet contracts as of December 31, 1998 were:

<TABLE>
<CAPTION>
NOTIONAL AMOUNT AVERAGE TERM
--------------- ----------------
(IN THOUSANDS) (REMAINING DAYS)
<S> <C> <C>
Forward exchange contracts.......................... $5,188 87
====== ===
</TABLE>

The table above summarizes the notional amounts and average term remaining
of the Company's forward exchange contracts. The notional amounts of off-balance
sheet contracts summarized above do not represent amounts exchanged by the
parties and thus are not a measure of the exposure of the Company. The amounts
exchanged are calculated on the basis of the notional amounts and the other
terms of the contract. Foreign currency amounts are translated at rates current
at the reporting date.

17. FAIR VALUE OF FINANCIAL INSTRUMENTS

Disclosure of estimated fair value of financial instruments is based on the
requirements of Statements of Financial Accounting Standards No. 105, 107 and
119, and upon the assumptions or methods described below. Different estimates
may have been obtained had other assumptions or methods been applied. The
estimates are not necessarily indicative of amounts that would be realized in a
market exchange.

CASH, RECEIVABLES, PAYABLES AND SHORT-TERM BORROWINGS

The carrying amounts of these items approximate fair value.

LONG-TERM DEBT

The fair value is the estimated net present value of future cash flows
using estimated current rates at which similar bank loans could be obtained for
the remaining maturities. As of December 31, 1998, the fair value and the
carrying amount of convertible subordinated note debt were approximately the
same.

FORWARD EXCHANGE CONTRACTS

The fair value is the amount at which the forward contract would be
settled, based upon estimates obtained from external counterparties. As of
December 31, 1998, the fair value of forward exchange contracts did not differ
significantly from their notional values.

F-18
<PAGE> 93
GETTY IMAGES, INC. AND GETTY COMMUNICATIONS PLC (PREDECESSOR)

18. SUPPLEMENTAL DISCLOSURES ON CASH FLOWS

NON-CASH INVESTING ACTIVITIES

Fixed asset additions financed through capital leases amounted to $279,000,
$121,000 and $463,000 for the year ended December 31, 1998, the year ended
December 31, 1997 and the year ended December 31, 1996, respectively.

Further non-cash investing activities relating to acquisitions are detailed
in Note 21.

19. LEGAL SETTLEMENT

The Company entered into a settlement agreement with Digital Stock
Corporation over a complaint filed in 1997. This resulted in a one time charge
to 1997 earnings of $1.0 million (including legal expenses).

20. SEGMENT INFORMATION

As a provider of visual content, the Company operates one business segment.
Sales are reported in the geographic area where they originate.

Financial information by geographic areas is as follows, this information
is subject to the impact of translation differences and is therefore not a
reflection of the relative performance of individual areas:

<TABLE>
<CAPTION>
EUROPE NORTH AMERICA REST OF WORLD CONSOLIDATED
------- ------------- ------------- ---------------
(IN THOUSANDS)
<S> <C> <C> <C> <C>
GETTY IMAGES, INC.
YEAR ENDED DECEMBER 31, 1998
Sales to customers.................. $94,823 $85,339 $ 4,922 $185,084
======= ======= ======= ========
GETTY COMMUNICATIONS PLC
YEAR ENDED DECEMBER 31, 1997
Sales to customers.................. 37,505 48,266 15,026 100,797
======= ======= ======= ========
GETTY COMMUNICATIONS PLC
YEAR ENDED DECEMBER 31, 1996
Sales to customers.................. 32,115 36,069 16,830 85,014
======= ======= ======= ========
</TABLE>

Due to the nature of the operations of the Company sales are made to a
diverse client base and there is no reliance on a single customer or group of
customers.

21. ACQUISITIONS

PHOTODISC

On February 9, 1998, a wholly-owned subsidiary of Getty Images acquired
PhotoDisc. PhotoDisc develop and market digital stock photography, products and
electronic delivery of images. The purchase consideration was $245.7 million
including expenses, which included the

F-19
<PAGE> 94
GETTY IMAGES, INC. AND GETTY COMMUNICATIONS PLC (PREDECESSOR)

21. ACQUISITIONS (CONTINUED)
issue of 8,083,831 shares of Getty Images Common Stock, at a total market value
of $171.8 million.

<TABLE>
<CAPTION>
BOOK AND
FAIR VALUE
--------------
(IN THOUSANDS)
<S> <C>
Cash consideration to holders of PhotoDisc Common Stock and
Series A Preferred Stock.................................. $ 34,076
Getty Images' transaction expenses.......................... 10,155
--------
Cash costs of the acquisition............................... 44,231
Stock consideration -- Shares of Getty Images Common Stock
issued (8,083,831 at $21.25).............................. 171,781
Fair value of options over shares of PhotoDisc Common Stock
converted to options over shares of Getty Images Common
Stock..................................................... 29,701
--------
Total purchase price........................................ 245,713
PhotoDisc net assets at February 9, 1998.................... (3,366)
--------
Excess of purchase price over net assets acquired........... $242,347
========
Amount allocated to specific intangibles (amortized over 2
to 3 years)............................................... 46,387
Amount allocated to goodwill (amortized over 20 years)...... 195,960
--------
$242,347
========
</TABLE>

ALLSPORT

On February 10, 1998, Getty Images purchased the entire issued share
capital of Allsport. Allsport is a world-wide sports photography company,
providing images to the sports journalism market and the broader market of
advertisers and sports promoters. The purchase consideration was $51.1 million,
including expenses, which included the issue of 1,137,916 shares of Getty Images
Common Stock at a total market value of $24.2 million.

<TABLE>
<CAPTION>
BOOK AND
FAIR VALUE
--------------
(IN THOUSANDS)
<S> <C>
Cash consideration to holders of Allsport Ordinary Shares at
closing................................................... $26,998
Getty Images' transaction expenses.......................... 900
-------
Cash costs of the acquisition............................... 27,898
Stock consideration -- Shares of Getty Images Common Stock
issued (691,899 at $21.25)(1)............................. 14,703
Fair value of options over shares of Allsport Ordinary
Shares held by an Employee Benefit Trust, converted to
options over shares of Getty Images Common Stock(1)....... 8,511
-------
Total purchase price........................................ 51,112
Allsport net assets at February 10, 1998.................... (631)
-------
Excess of purchase price over net assets acquired........... $50,481
=======
Amount allocated to specific intangibles (amortized over 2
to 3 years)............................................... 4,571
Amount allocated to goodwill (amortized over 20 years)...... 45,910
-------
$50,481
=======
</TABLE>

F-20
<PAGE> 95
GETTY IMAGES, INC. AND GETTY COMMUNICATIONS PLC (PREDECESSOR)

21. ACQUISITIONS (CONTINUED)
(1) Of the stock consideration of 1,137,916 shares of Getty Images Common Stock,
446,017 were issued to an Employee Benefit Trust established on behalf of
certain employees of Allsport. Such shares of Getty Images Common Stock have
not been valued for the purpose of calculating the stock consideration, but
the underlying options over Allsport Ordinary Shares, which converted into
options over shares of Getty Images Common Stock, have been valued by
reference to the Black-Scholes Option pricing model.

ENERGY

On July 25, 1997, the Company acquired all of the common stock of Energy
Film Library Inc. ("Energy"). Energy is a Los Angeles based provider of
contemporary stock footage with another office in New York and representation in
most major markets through independent third agencies. The purchase
consideration was $17.5 million including expenses, which included the issue of
617,762 Class A Shares at a total market value of $4.0 million.

<TABLE>
<CAPTION>
BOOK AND
FAIR VALUE
--------------
(IN THOUSANDS)
<S> <C>
Cash paid, including acquisition expenses................... $13,500
Stock consideration -- Shares of Getty Communications stock
issued (617,762 at $6.47)................................. 4,000
-------
Total purchase price........................................ 17,500
Energy net liabilities acquired at July 25, 1997............ $ 181
-------
Excess of purchase price over net assets acquired, allocated
to goodwill (amortized over 20 years)..................... $17,681
=======
</TABLE>

LIAISON

On March 14, 1997, the Company acquired all the common stock of Liaison
Inc. ("Liaison"). Liaison is a provider of photographs to the photojournalist
market, operating primarily in North America but with relationships with
independent third party agencies in most major markets.

The purchase consideration was $9.4 million, including expenses, which
included the issue of 311,846 Class A Shares at total market value of $2.6
million.

<TABLE>
<CAPTION>
BOOK AND
FAIR VALUE
--------------
(IN THOUSANDS)
<S> <C>
Cash paid, including acquisition expenses................... $ 6,809
Stock consideration -- Shares of Getty Communications stock
issued (311,846 at $8.34)................................. 2,600
-------
Total purchase price........................................ 9,409
Liaison net liabilities acquired at March 14, 1997.......... $ 793
-------
Excess of purchase price over net assets acquired, allocated
to goodwill (amortized over 25 years)..................... $10,202
=======
</TABLE>

F-21
<PAGE> 96
GETTY IMAGES, INC. AND GETTY COMMUNICATIONS PLC (PREDECESSOR)

22. PRO FORMA INFORMATION RELATING TO ACQUISITIONS (UNAUDITED)

The following unaudited pro forma information shows the results of the
Company for each of the three years ended December 31, 1998, as if the
acquisition of Hulton Getty Holdings Limited, Fabulous Footage and World View
occurred on January 1, 1996, the acquisitions of Liaison and Energy occurred on
January 1, 1997 and the acquisitions of PhotoDisc and Allsport occurred on
January 1, 1998. The proforma information includes adjustments related to the
financing of the acquisitions, the effect of amortizing goodwill and other
intangible assets acquired, as well as the related tax effects. The pro forma
results of operations are unaudited, have been prepared for comparative purposes
only and do not purport to indicate the results of operations which would
actually have occurred had the combinations been in effect on the dates
indicated or which may occur in the future.

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31
----------------------------------------
1998 1997 1996
----------- ----------- ----------
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
(UNAUDITED)
<S> <C> <C> <C>
Sales............................................ $191,912 $105,592 $93,120
Net (loss)/income................................ (36,616) 3,692 2,786
Net (loss)/income per share...................... $ (1.26) $ 0.09 $ 0.09
</TABLE>

F-22
<PAGE> 97

REPORT OF INDEPENDENT ACCOUNTANTS

September 13, 1999

To the Board of Directors of
Eastman Kodak Company

In our opinion, the accompanying consolidated balance sheet and the related
consolidated statements of operations and of cash flows present fairly, in all
material respects, the financial position of The Image Bank, Inc. (the
"Company"), a wholly owned subsidiary of Eastman Kodak Company ("Kodak") at
December 31, 1998, and the results of its operations and its cash flows for the
year then ended, in conformity with generally accepted accounting principles.
These financial statements are the responsibility of the Company's management;
our responsibility is to express an opinion on these financial statements based
on our audit. We conducted our audit of these statements in accordance with
generally accepted auditing standards which require that we plan and perform the
audit to obtain reasonable assurance about whether the financial statements are
free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements,
assessing the accounting principles used and significant estimates made by
management, and evaluating the overall financial statement presentation. We
believe that our audit provides a reasonable basis for the opinion expressed
above.

PRICEWATERHOUSECOOPERS LLP
Rochester, New York

F-23
<PAGE> 98

THE IMAGE BANK, INC.
(A WHOLLY OWNED SUBSIDIARY OF EASTMAN KODAK COMPANY)

CONSOLIDATED BALANCE SHEET

<TABLE>
<CAPTION>
AT
DECEMBER 31,
1998
------------
<S> <C>
ASSETS
Current assets:
Cash and cash equivalents................................... $ 1,874,592
Accounts receivable, net.................................... 21,591,506
Prepaid expenses and other assets........................... 2,312,865
------------
Total current assets........................................ 25,778,963
------------
Non-current assets:
Libraries, net.............................................. 9,541,630
Fixed assets, net........................................... 7,970,163
Goodwill, net............................................... 42,763,307
Other assets................................................ 1,807,088
------------
Total assets................................................ $ 87,861,151
============
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued expenses....................... $ 5,921,022
Fees payable to photographers and cinematographers.......... 11,654,009
------------
Total current liabilities................................... 17,575,031
------------
Non-current liabilities:
Advances from Kodak......................................... 47,356,841
Other liabilities........................................... 1,628,820
------------
Total liabilities........................................... 66,560,692
------------
Shareholders' equity:
Capital stock, par value .01 per share, 10,000,000 shares
authorized; 3,000,000 shares issued and outstanding....... 30,000
Additional paid-in capital.................................. 32,995,805
Accumulated deficit......................................... (11,272,433)
Cumulative translation adjustment........................... (452,913)
------------
Total shareholders' equity.................................. 21,300,459
------------
Total liabilities and shareholders' equity.................. $ 87,861,151
============
</TABLE>

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

F-24
<PAGE> 99

THE IMAGE BANK, INC.
(A WHOLLY OWNED SUBSIDIARY OF EASTMAN KODAK COMPANY)

CONSOLIDATED STATEMENT OF OPERATIONS

<TABLE>
<CAPTION>
FOR THE
YEAR ENDED
DECEMBER 31,
1998
------------
<S> <C>
REVENUES:
Photography................................................. $45,997,513
Cinematography.............................................. 24,835,272
-----------
TOTAL REVENUES.............................................. 70,832,785
-----------
DIRECT COSTS:
Photography................................................. 20,540,893
Cinematography.............................................. 9,083,197
-----------
TOTAL DIRECT COSTS.......................................... 29,624,090
GROSS PROFIT................................................ 41,208,695
Depreciation and amortization............................... 8,919,392
Selling, general and administrative expenses................ 33,790,819
-----------
LOSS FROM OPERATIONS........................................ (1,501,516)
-----------
OTHER INCOME (EXPENSE):
Interest income............................................. 25,911
Interest expense............................................ (311,768)
Other income................................................ 325,417
Foreign currency gain....................................... 65,068
LOSS BEFORE INCOME TAXES.................................... (1,396,888)
Provision for income taxes.................................. 1,954,144
NET LOSS.................................................... $(3,351,032)
-----------
Other comprehensive loss:
Foreign currency translation adjustment..................... (444,635)
-----------
TOTAL COMPREHENSIVE LOSS.................................... $(3,795,667)
===========
</TABLE>

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

F-25
<PAGE> 100

THE IMAGE BANK, INC.
(A WHOLLY OWNED SUBSIDIARY OF EASTMAN KODAK COMPANY)

CONSOLIDATED STATEMENT OF CASH FLOWS

<TABLE>
<CAPTION>
FOR THE
YEAR ENDED
DECEMBER 31,
1998
------------
<S> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss.................................................... $ (3,351,032)
Adjustments to reconcile net loss to net cash flow provided
by operating activities:
Depreciation and amortization............................... 8,919,392
Gain from sale of fixed assets.............................. (268,612)
CHANGES IN OPERATING ASSETS AND LIABILITIES:
Accounts receivable......................................... 339,619
Prepaid expenses and other assets........................... (731,229)
Accounts payable and accrued expenses....................... (240,987)
Fees payable to photographers and cinematographers.......... 994,911
Other liabilities........................................... (385,831)
------------
NET CASH PROVIDED BY OPERATIONS............................. 5,276,231
------------
CASH FLOWS USED IN INVESTING ACTIVITIES:
Additions to libraries...................................... (4,813,310)
Additions to fixed assets, net of sales..................... (3,225,765)
Acquisition of Artville, net of cash acquired............... (9,173,781)
------------
NET CASH USED IN INVESTING ACTIVITIES....................... (17,212,856)
------------
CASH FLOWS PROVIDED BY FINANCING ACTIVITIES:
Net advances from Kodak..................................... 13,246,243
Payments on capital lease obligations....................... (245,898)
------------
NET CASH PROVIDED BY FINANCING ACTIVITIES................... 13,000,345
------------
Net increase in cash and cash equivalents................... 1,063,720
Cash and cash equivalents, beginning of year................ 810,872
------------
Cash and cash equivalents, end of year...................... $ 1,874,592
============
CASH PAID DURING THE YEAR FOR:
Interest.................................................... 283,791
------------
Income taxes................................................ 50,028
------------
</TABLE>

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

F-26
<PAGE> 101

THE IMAGE BANK, INC.
(A WHOLLY OWNED SUBSIDIARY OF EASTMAN KODAK COMPANY)

NOTES TO FINANCIAL STATEMENTS
YEAR ENDED DECEMBER 31, 1998

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

NATURE OF THE BUSINESS

The Image Bank, Inc. (the "Company"), a wholly owned subsidiary of Eastman
Kodak Company ("Kodak"), markets and licenses the reproduction rights to
photography and cinematography products to customers worldwide. The Company owns
or controls the rights, through representation agreements with photographers and
cinematographers, to more than 10 million photographs and 15,000 hours of film
footage.

The rights to these images are marketed to advertising and design agencies,
production companies, magazines, newspapers and broadcasters in many countries
throughout the world by the company's sales offices in the Unites States, France
and Hong Kong and by the Company's network of franchised sales offices.

BASIS OF PRESENTATION

The consolidated financial statements include the Company and its majority
owned subsidiary companies. All intercompany transactions have been eliminated.
Services provided to the Company by Kodak are insignificant; therefore, no
corporate allocations have been included in the statement of operations.

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 and
disclosures of contingent assets and liabilities, if any, at year end and the
reported amounts of revenues and expenses during the reporting period. Actual
results could differ from those estimates.

FOREIGN CURRENCY TRANSLATION

Local currencies are the functional currencies of the Company's foreign
subsidiaries in France and Hong Kong. Assets and liabilities of foreign
operations are translated to U.S. dollars at current rates of exchange and
revenues and expenses are translated using average rates. Gains and losses from
foreign currency translation are included as a separate component of
shareholders' equity. Foreign currency transaction gains and losses are included
as a component of other income/expense.

CONCENTRATION OF CREDIT RISK

Financial instruments which potentially expose the Company to concentration
of credit risk consist principally of accounts receivable. The Company performs
ongoing credit evaluations of its customers' financial condition and maintains
an allowance for uncollectible accounts receivable based upon the expected
collectibility of such amounts. No single customer accounts for more than 10% of
the Company's revenues and receivables.

F-27
<PAGE> 102
THE IMAGE BANK, INC.
(A WHOLLY OWNED SUBSIDIARY OF EASTMAN KODAK COMPANY)

NOTES TO FINANCIAL STATEMENTS (CONTINUED)
YEAR ENDED DECEMBER 31, 1998

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
CASH AND CASH EQUIVALENTS

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

LIBRARIES

Costs associated with the digitization of images and the production of
duplicates are capitalized. Duplicates represent copies of the Company's
portfolio of images which are distributed to the company's sales offices and
network of franchised sales offices. Amortization of libraries is computed on a
straight-line basis over the estimated useful lives of the assets, which is five
years for photographic duplicates and seven years for film duplicates.

FIXED ASSETS

Fixed assets are stated at cost and consist of computer equipment and
software, image duplication equipment, furniture and fixtures and leasehold
improvements. Expenditures for additions to fixed assets are capitalized and the
cost of repairs and maintenance is expensed when incurred. Depreciation of fixed
assets is computed on a straight-line balance basis over the estimated useful
lives of the assets, which is generally two to ten years. Leasehold improvements
are amortized on a straight-line basis over the shorter of the terms of the
leases or the estimated useful lives of the assets.

The costs of internally-developed software are capitalized and amortized
from the implementation date over the estimated useful lives, generally five
years.

GOODWILL

Goodwill includes the excess of the cost of net assets acquired in the
Company's business combinations over their fair value as well as the push-down
of goodwill resulting from Kodak's October 1991 acquisition of the Company.
Goodwill is amortized on a straight-line basis over the period estimated to be
benefited, between ten and fifteen years. The Company regularly assesses its
long-lived assets for impairment when events or circumstances indicate their
carrying value amounts may not be recoverable. Additions in 1998 to goodwill
arose from the acquisition of Artville, Inc. ("Artville") and totaled $7,890,000
(see Note 12). Total goodwill amortization amounted to $4,227,630 in 1998.

FEES PAYABLE TO PHOTOGRAPHERS AND CINEMATOGRAPHERS

The Company controls the rights to a portfolio of images through
representation agreements with artists and photographers. As consideration for
the rights to such images, the photographer or cinematographer receives a
royalty from the Company each time the rights to an image are licensed to a
customer by either the Company or its franchised sales offices and the Company
has collected the associated receivable from the customer or the licensee.

F-28
<PAGE> 103
THE IMAGE BANK, INC.
(A WHOLLY OWNED SUBSIDIARY OF EASTMAN KODAK COMPANY)

NOTES TO FINANCIAL STATEMENTS (CONTINUED)
YEAR ENDED DECEMBER 31, 1998

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
INCOME TAXES

Income tax expense is based on reported earnings before income taxes.
Deferred income taxes reflect the impact of temporary differences between the
amounts of assets and liabilities recognized for financial reporting purposes
and such amounts recognized for tax purposes.

REVENUE RECOGNITION

Revenue is recognized when the Company or its franchised sales office has
agreed on the price and the use of an image with a customer and the image has
been delivered to the customer.

ADVERTISING COSTS

The Company charges all non-catalogue advertising costs to operations when
incurred. Advertising expense amounted to $1,770,000 in 1998.

The costs of producing and distributing catalogues, net of reimbursements
from franchised sales offices, photographers and cinematographers, are
capitalized. Amortization expense is recorded over the estimated useful life,
generally two years from the date the catalogues are available for distribution
to customers.

Prepaid expenses and other non-current assets include capitalized catalogue
costs totaling $1,773,404 at December 31, 1998. Catalogue costs expensed in 1998
totaled $1,524,000.

2. ACCOUNTS RECEIVABLE

Accounts receivable consist of the following:

<TABLE>
<CAPTION>
DECEMBER 31,
1998
------------
<S> <C>
Trade receivables........................................... $ 9,768,493
Franchise receivables....................................... 18,872,607
Other....................................................... 390,627
-----------
Total....................................................... 29,031,727
Less -- Allowance for doubtful accounts..................... 7,440,221
-----------
$21,591,506
===========
</TABLE>

F-29
<PAGE> 104
THE IMAGE BANK, INC.
(A WHOLLY OWNED SUBSIDIARY OF EASTMAN KODAK COMPANY)

NOTES TO FINANCIAL STATEMENTS (CONTINUED)
YEAR ENDED DECEMBER 31, 1998

3. LIBRARIES

Libraries consist of the following:

<TABLE>
<CAPTION>
DECEMBER 31,
1998
------------
<S> <C>
Photographic duplicates..................................... $ 8,375,975
Film duplicates............................................. 10,194,686
Total cost.................................................. 18,570,661
Less -- Accumulated amortization............................ 9,029,031
-----------
Libraries, net.............................................. $ 9,541,630
===========
</TABLE>

Libraries amortization expense amounted to $2,340,842 in 1998.

4. FIXED ASSETS

Fixed assets consist of the following:

<TABLE>
<CAPTION>
DECEMBER 31,
1998
------------
<S> <C>
Computer equipment and software............................. $ 5,840,112
Image duplication equipment................................. 1,714,031
Furniture and fixtures...................................... 8,187,282
Leasehold improvements...................................... 4,096,615
-----------
Total cost.................................................. 19,838,040
Less -- Accumulated depreciation............................ 11,867,877
-----------
Fixed assets, net........................................... $ 7,970,163
===========
</TABLE>

Image duplication equipment at December 31, 1998 used under capitalized
leases totaled $1,022,713, net of accumulated depreciation of $621,475.
Depreciation expense on assets under capital leases was approximately $130,000.
Total depreciation expense amounted to $2,350,920 in 1998.

5. ACCOUNTS PAYABLE AND ACCRUED EXPENSES

Accounts payable and accrued expenses consist of the following:

<TABLE>
<CAPTION>
DECEMBER 31,
1998
------------
<S> <C>
Trade payables.............................................. $1,163,573
Employee-related liabilities................................ 1,701,295
Other....................................................... 3,056,154
----------
Total....................................................... $5,921,022
==========
</TABLE>

F-30
<PAGE> 105
THE IMAGE BANK, INC.
(A WHOLLY OWNED SUBSIDIARY OF EASTMAN KODAK COMPANY)

NOTES TO FINANCIAL STATEMENTS (CONTINUED)
YEAR ENDED DECEMBER 31, 1998

6. LEASES

The Company leases all of its office facilities and certain office
equipment. Future minimum lease payments under noncancellable leases at December
31, 1998 are as follows:

<TABLE>
<CAPTION>
CAPITALIZED OPERATING
LEASES LEASES
----------- -----------
<S> <C> <C>
1999...................................................... $215,840 $ 3,018,000
2000...................................................... 199,314 2,808,000
2001...................................................... 109,176 2,252,000
2002...................................................... -- 2,130,000
2003 and thereafter....................................... -- 3,132,000
-------- -----------
Total minimum lease payments.............................. 524,330 $13,340,000
-------- -----------
Less: Amount representing interest........................ 56,982
Present value of net minimum lease payments, including
current maturities of $192,383.......................... $467,348
========
</TABLE>

7. INCOME TAXES

The components of the loss from operations before income taxes and the
related provision (benefit) for U.S. and other income taxes are as follows:

<TABLE>
<CAPTION>
DECEMBER 31,
1998
------------
<S> <C>
Loss before income taxes
U.S. ....................................................... $ (973,816)
Outside the U.S. ........................................... (423,072)
-----------
Total....................................................... (1,396,888)
U.S. income taxes
Current provision........................................... $ 45,564
Deferred provision.......................................... --
Income taxes outside the U.S.
Current provision........................................... 1,793,284
Deferred provision.......................................... --
State and other income taxes
Current provision........................................... 115,296
Deferred provision.......................................... --
-----------
Total $ 1,954,144
===========
</TABLE>

F-31
<PAGE> 106
THE IMAGE BANK, INC.
(A WHOLLY OWNED SUBSIDIARY OF EASTMAN KODAK COMPANY)

NOTES TO FINANCIAL STATEMENTS (CONTINUED)
YEAR ENDED DECEMBER 31, 1998

7. INCOME TAXES (CONTINUED)
The differences between the provision for income taxes and income taxes
computed using the U.S. federal income tax rate are as follows:

<TABLE>
<CAPTION>
DECEMBER 31,
1998
------------
<S> <C>
Amount computed using the statutory rate.................... $ (488,911)
Increase in taxes resulting from:
Valuation allowance......................................... 1,478,993
Goodwill amortization....................................... 674,305
Foreign tax rate differences................................ 182,354
State and other income taxes................................ 74,942
Other, net.................................................. 32,461
----------
Provision for income taxes.................................. $1,954,144
==========
</TABLE>

The significant components of deferred tax assets and liabilities are as
follows:

<TABLE>
<CAPTION>
DECEMBER 31,
1998
------------
<S> <C>
Deferred tax assets
Bad debt reserves........................................... $2,849,604
Equity investments.......................................... 1,105,420
Foreign tax credits......................................... 996,421
Restructuring programs...................................... 507,820
Minimum tax credits......................................... 45,564
Other....................................................... 942,171
----------
6,447,000
Valuation allowance......................................... 5,277,000
----------
Total....................................................... 1,170,000
==========
Deferred tax liabilities
Other 1,170,000
----------
Total $1,170,000
==========
</TABLE>

The valuation allowance is primarily attributable to foreign tax credit
carryforwards from 1998 which may be carried forward for 5 years. Foreign tax
credit carryforwards from prior years have not been determined since it is not
practicable to calculate these credits and, if determined, would be fully offset
by a valuation allowance.

F-32
<PAGE> 107
THE IMAGE BANK, INC.
(A WHOLLY OWNED SUBSIDIARY OF EASTMAN KODAK COMPANY)

NOTES TO FINANCIAL STATEMENTS (CONTINUED)
YEAR ENDED DECEMBER 31, 1998

8. COMMITMENTS

On June 15, 1994, the Company executed a non-compete agreement with
Petrified Films, Inc., which prohibits Petrified Films, Inc. from competing in
the sale, marketing and licensing of archival film moving pictures. Expenses
under this agreement amounted to $256,100 in 1998. Future minimum payments under
the non-compete agreement are as follows:

<TABLE>
<S> <C>
1999........................................................ $256,100
2000........................................................ 256,100
2001........................................................ 256,100
2002........................................................ 149,394
--------
Total $917,694
========
</TABLE>

In connection with the acquisition of 80% of the common stock of Artville
(Note 12), the Company is required to purchase the remaining 20% of the common
stock of Artville by December 31, 2003 or earlier if the Company acquires
another business which competes with Artville, for an amount no less than
$3,250,000. Also, if the minority shareholder's employment is terminated prior
to December 31, 2003, the Company is required to purchase the remaining 20% of
the common stock of Artville, for an amount no less than $1 million.

9. EMPLOYEE BENEFIT PLANS

The Company maintains a 401(k) plan covering substantially all employees
who meet certain age and length of service requirements. The Company contributes
a percentage of the amount of salary deferral contributions made by each
participating employee. The amount charged to expense related to this plan was
approximately $110,041 in 1998.

10. GEOGRAPHIC INFORMATION

The Company operates under one business segment. Financial information for
the year ended December 31, 1998 by geographic region is as follows (sales are
reported in the geographic area of the customer or franchised sales office):

<TABLE>
<CAPTION>
NORTH AND ASIA-
SOUTH AMERICA EUROPE PACIFIC ELIMINATIONS TOTAL
------------- ----------- ---------- ------------- -----------
<S> <C> <C> <C> <C> <C>
Revenues............. $58,862,836 $29,932,759 $4,323,163 $ (22,424,538) $70,694,220
Long-lived assets.... 61,185,570 742,415 144,203 -- 62,082,188
</TABLE>

11. RELATED PARTY TRANSACTIONS

The Company purchases photographic laboratory services from the Color
Place, Inc., an entity which is wholly owned by the Chief Executive Officer of
the Company. Purchases in 1998 from the Color Place, Inc. totaled $773,000. The
Company believes these services are provided at fair market value.

The Company's internet site is maintained by Picture Network International,
a wholly owned subsidiary of Kodak. Picture Network billed the Company $267,000
for these services during 1998. The Company believes these services are provided
at fair market value.

F-33
<PAGE> 108
THE IMAGE BANK, INC.
(A WHOLLY OWNED SUBSIDIARY OF EASTMAN KODAK COMPANY)

NOTES TO FINANCIAL STATEMENTS (CONTINUED)
YEAR ENDED DECEMBER 31, 1998

11. RELATED PARTY TRANSACTIONS (CONTINUED)
Kodak funds the Company's cash flow requirements. Net borrowings from Kodak
are non-interest bearing.

12. ACQUISITION OF ARTVILLE

In October 1998, the Company acquired 80% of the common stock of Artville
for approximately $9,334,220. Artville is engaged in the marketing of
royalty-free image products, primarily illustrations. The acquisition has been
accounted for as a purchase and, Artville's operating results have been included
in the financial statements from the date of acquisition.

On an unaudited pro forma basis, the estimated combined revenues and net
loss of the Company, as though the acquisition of Artville was made at the
beginning of 1998, are approximately $74 million and $4 million, respectively.
The pro forma amounts do not necessarily reflect the results that actually would
have been obtained had the transaction taken place at the beginning of the year
nor are they intended to be a projection of future results.

13. SUBSEQUENT EVENT

On August 3, 1999, Kodak signed a letter of intent to sell all of the
Company's common stock to Getty Images, Inc. ("Getty"), a publicly owned visual
content provider. The sale is subject to the execution of a definitive agreement
by the parties and approvals by regulatory agencies.

F-34
<PAGE> 109

GETTY IMAGES
<PAGE> 110

PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.

The expenses in connection with the issuance and distribution of the
securities being registered, other than commissions and discounts of
underwriters, dealers or agents are as follows:

<TABLE>
<S> <C>
SEC registration fee........................................ $
--------
Legal fees and expenses.....................................
--------
Printing and engraving expenses.............................
--------
Accounting fees and expenses................................
--------
Miscellaneous...............................................
--------
$
========
</TABLE>

All of the above expenses, other than the SEC registration fee, are
estimates.

Getty Images has paid substantially all of the expenses of the issuance and
distribution of the securities being registered, other than commissions and
discounts of underwriters, dealers or agents.

ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS

Except to the extent indicated below, there is no charter provision,
by-law, contract, arrangement or statute under which any controlling person,
director or officer of Getty Images is insured or indemnified in any manner
against any liability which he or she may incur in his or her capacity as such.

The Delaware General Corporation Law (the "DGCL") provides that a
corporation may, and in certain circumstances must, indemnify its directors,
officers, employees and agents for expenses, judgments or settlements actually
and reasonably incurred by them in connection with suits and other legal actions
or proceedings if they acted in good faith and in a manner they reasonably
believed to be in or not opposed to the best interests of the corporation and,
with respect to any criminal action or proceeding, had no reasonable cause to
believe their conduct was unlawful. In any such suit or action brought by or on
behalf of the corporation, such indemnification is limited to expenses incurred
in defense or settlement of the suit or action. The DGCL also permits a
corporation to adopt procedures for advancing expenses to directors, officers
and others without the need for a case-by-case determination of eligibility, so
long as, in the case of officers and directors, they undertake to repay the
amounts advanced if it is ultimately determined that the officer or director was
not entitled to be indemnified. The Certificate of Incorporation of Getty Images
(the "Certificate of Incorporation") and the Bylaws of Getty Images (the
"Bylaws") contain provisions for indemnification of directors and officers and
for the advancements of expenses to any director or officer to the fullest
extent of the law.

The DGCL permits corporations to purchase and maintain insurance for
directors and officers against liability for expenses, judgments or settlements,
whether or not the corporation would have the power to indemnify such persons
therefor. The Bylaws permit Getty Images to purchase such insurance. Getty
Images has director and officer insurance in place for its directors and
officers.

Getty Images has also agreed by contract to indemnify the directors and
certain officers of Getty Images for certain liabilities incurred by such
persons by reason of the fact that such person is a director or officer,
provided that such person was acting in good faith.

II-1
<PAGE> 111

ITEM 16. EXHIBITS

<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF EXHIBITS
- ------- -----------------------
<S> <C>
1.1 Form of Underwriting Agreement**
5.1 Opinion of Weil, Gotshal & Manges LLP regarding validity of
securities**
15.1 Letter from PricewaterhouseCoopers to the Securities and
Exchange Commission dated September 24, 1999, regarding
review of interim consolidated financial information.*
23.1 Consent of PricewaterhouseCoopers, London, England*
23.2 Consent of PricewaterhouseCoopers, LLP, Rochester, New York*
23.3 Consent of Arthur Andersen LLP, Chicago, Illinois*
23.4 Consent of PricewaterhouseCoopers, Seattle, Washington*
23.5 Consent of Deloitte & Touche, LLP, Seattle, Washington*
23.6 Consent of Weil, Gotshal & Manges LLP (included in Exhibit
5.1)**
24.1 Powers of Attorney (included on the signature page hereto)*
</TABLE>

- -------------------------
* Filed herewith.

** To be filed by amendment.

ITEM 17. UNDERTAKINGS

Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the foregoing provisions or otherwise, the Registrant has
been advised that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Securities Act of
1933 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 of 1933 and will be governed by the final adjudication of such issue.

The undersigned registrant hereby undertakes that:

(1) For purposes of determining liability under the Securities Act of
1933, the information omitted from the form of prospectus filed as part of
this registration statement in reliance upon Rule 430A and contained in a
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 a part of this
registration statement as of the time it was declared effective.

(2) For the purpose of determining any liability under the Securities
Act of 1933, 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-2
<PAGE> 112

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in Seattle, Washington, on the 29th day of September, 1999.

GETTY IMAGES, INC.

By: /s/ MARK H. GETTY
--------------------------------------
Mark H. Getty
Executive Chairman

POWER OF ATTORNEY

We, the undersigned officers and directors of Getty Images, Inc., do hereby
severally constitute and appoint Mark Getty and Jonathan Klein and each of them
our true and lawful attorneys-in-fact and agents, each with full power of
substitution and resubstitution, for him and his name, place and stead, in any
and all capacities, to sign any and all amendments to this Registration
Statement (including any post-effective amendments), and to file the same, with
exhibits thereto, and other documents in connection therewith, with the
Securities and Exchange Commission, granting unto said attorneys-in-fact and
agents, and each of them, full power and authority to do and perform each and
every act and thing requisite or necessary to be done in and about the premises,
as fully to all intents and purposes as he might or could do in person, hereby,
ratifying and confirming that each of said attorneys-in-fact and agents, or his
substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following person in the
capacities and on the dates indicated.

<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<S> <C> <C>
/s/ MARK H. GETTY Executive Chairman and September 29, 1999
- ------------------------------------------------ Director
Mark H. Getty

/s/ JONATHAN D. KLEIN Chief Executive Officer September 29, 1999
- ------------------------------------------------ and Director
Jonathan D. Klein

/s/ CHRISTOPHER J. ROLING Senior Vice President, September 29, 1999
- ------------------------------------------------ Finance and Chief
Christopher J. Roling Financial Officer

/s/ MARK TORRANCE Non-executive Vice September 29, 1999
- ------------------------------------------------ Chairman and Director
Mark Torrance

/s/ ANDREW GARB Director September 29, 1999
- ------------------------------------------------
Andrew Garb
</TABLE>

II-3
<PAGE> 113

<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<S> <C> <C>
/s/ JAMES N. BAILEY Director September 29, 1999
- ------------------------------------------------
James N. Bailey

Director September , 1999
- ------------------------------------------------
Christopher S. Sporborg

Director September , 1999
- ------------------------------------------------
Anthony Stone
</TABLE>

II-4
<PAGE> 114

EXHIBIT INDEX

<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF EXHIBITS
- ------- -----------------------
<S> <C>
1.1 Form of Underwriting Agreement**
5.1 Opinion of Weil, Gotshal & Manges LLP regarding validity of
securities**
15.1 Letter from PricewaterhouseCoopers to the Securities and
Exchange Commission dated September 24, 1999, regarding
review of interim consolidated financial information.*
23.1 Consent of PricewaterhouseCoopers, London, England*
23.2 Consent of PricewaterhouseCoopers LLP, Rochester, New York*
23.3 Consent of Arthur Andersen LLP, Chicago, Illinois*
23.4 Consent of PricewaterhouseCoopers LLP, Seattle, Washington
23.5 Consent of Deloitte & Touche LLP, Seattle, Washington*
23.6 Consent of Weil, Gotshal & Manges LLP (included in Exhibit
5.1)**
24.1 Powers of Attorney (included on the signature page hereto)*
</TABLE>

- ---------------
* Filed herewith.

** To be filed by amendment.

<PAGE> 1
[PRICEWATERHOUSECOOPERS LETTERHEAD]

EXHIBIT NO. 15.1

September 24, 1999

Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
U.S.A.

Commissioners:

We are aware that our reports dated May 17, 1999 and August 16, 1999 on our
reviews of interim consolidated financial information of Getty Images, Inc.
(the "Company") and subsidiaries for the three month periods ended March 31,
1999 and 1998 and the three month and six month periods ended June 30, 1999 and
1998 which are included in the Company's quarterly reports on Form 10-Q for the
quarters then ended, are incorporated by reference in its Registration
Statement on Form S-3 dated September 29, 1999.

Yours faithfully,

/s/ PRICEWATERHOUSECOOPERS
- -----------------------------------
PricewaterhouseCoopers

<PAGE> 1

EXHIBIT 23.1

CONSENT OF INDEPENDENT ACCOUNTANTS

We hereby consent to the incorporation by reference in this Registration
Statement on Form S-3 of our reports dated March 31, 1999 relating to the
consolidated financial statements and financial statement schedules, which
appear in Getty Images, Inc.'s Annual Report on Form 10-K for the year ended
December 31, 1998. We also consent to the reference to us under the heading
"Experts" in such Registration Statement.

PricewaterhouseCoopers

PricewaterhouseCoopers
London
September 27, 1999

<PAGE> 1

EXHIBIT 23.2

CONSENT OF INDEPENDENT ACCOUNTANTS

We hereby consent to the use in this Registration Statement on Form S-3 of
our report dated September 13, 1999 relating to the consolidated financial
statements of The Image Bank, Inc., which appears in such Registration
Statement. We also consent to the reference to us under the headings "Experts"
and "Selected Consolidated Financial Data of The Image Bank" in such
Registration Statement.

PricewaterhouseCoopers LLP

Rochester, New York
September 27, 1999

<PAGE> 1

EXHIBIT 23.3

CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS

As independent public accountants, we hereby consent to the incorporation
by reference in this registration statement of our report dated March 12, 1999
(except for Note 10, as to which the date is May 5, 1999) included in Getty
Images, Inc.'s Form 10-Q/A for the quarter ended March 31, 1999 and to all
references to our Firm included in this registration statement.

Arthur Andersen LLP

ARTHUR ANDERSEN LLP

Chicago, Illinois
September 24, 1999

<PAGE> 1

EXHIBIT 23.4

CONSENT OF INDEPENDENT ACCOUNTANTS

We hereby consent to the incorporation by reference in this Registration
Statement on Form S-3 of our report dated February 25, 1998, relating to the
consolidated financial statements of Photodisc, Inc. and its subsidiaries as of
and for the year ended December 31, 1997, which appears in the Current Report on
Form 8-K/A, filed by Getty Images on April 27, 1998. We also consent to the
reference to us under the heading "Experts" in such Registration Statement.

PricewaterhouseCoopers LLP

PricewaterhouseCoopers LLP
Seattle, Washington
September 27, 1999

<PAGE> 1

EXHIBIT 23.5

INDEPENDENT AUDITORS' CONSENT

We consent to the incorporation by reference in this Registration Statement
on Form S-3 of our report dated August 12, 1997 (September 16, 1997 as to Note
1) on the consolidated financial statements of PhotoDisc, Inc. and subsidiaries,
appearing in the report on Form 8-K of Getty Images, Inc. filed with the SEC on
May 6, 1998, and to the reference to us under the heading "Experts" in the
Prospectus which is part of this Registration Statement.

Deloitte & Touche LLP

DELOITTE & TOUCHE LLP

Seattle, Washington
September 27, 1999