EFTA01378023.pdf

$21.8 million. primarily related to the internal development of software to support our products and services. Net cash used in investing activities in 2013 includes acquisitions of $32.1 million, which include Twoo. and capital expenditures of $19.8 million primarily related to the internal development of software to support our products and services. Net cash used in investing activities in 2012 includes acquisitions of $59.5 million, primarily related to Tutor.com and Dale Hookup, and capital expenditures of $19.9 million primal* related to the internal development of software to support our products and services. Cash flows used in financing activities Net cash provided by financing activities in the nine months ended September 30, 2015 includes net cash transfers of $75.9 million from IAC and $31.3 million in excess tax benefits from stock-based awards, partially offset by $5.5 million in contingent consideration payments. The net cash transfers include a $155.0 million capital contribution to partially fund the Plenty0IFish acquisition, partially offset by cash transfers to IAC of $79.1 million that relate to IAC's centrally managed U.S. treasury management function. Net cash provided by financing activities in the nine months ended September 30. 2014 includes $119.1 million in proceeds from the issuance of related party debt, the return of $12.4 million of funds held in escrow related to the Meetic tender offer and $5.3 million in excess tax benefits from stock-based awards, partially offset by cash transfers of $80.8 million to IAC, $30.3 million for the purchase of noncontrolling interests and $7.4 million in contingent consideration payments related to the 2013 Twoo acquisition. Net cash used in financing activities in 2014 includes cash transfers of $108.1 million to IAC, $33.2 million for the purchase of noncontrolling interests in Tinder and Meetic and a $7.4 million contingent consideration payment related to the 2013 Twoo acquisition, partially offset by $111.6 million in proceeds from the issuance of related party debt, the return of $12.4 million of funds held in escrow related to the Meetic tender offer and $5.3 million in excess tax benefits from stock based awards. Net cash used in financing activities in 2013 includes $71.5 million held in escrow related to the Meetic tender offer and $52.6 million for the purchase of noncontrolling interests in Meetic. partially offset by $10.8 million in excess tax benefits from stock-based awards and cash transfers of $9.7 million from RC. Net cash used in financing activities in 2012 includes cash transfers of $53.4 million to IAC. partially offset by $8.4 million in excess tax benefits from stock- based awards. 89 Table of Cnntenk Contractual obligations and contingencies Our principal commitments consist of obligations under related party debt and operating leases for equipment and office space. The following table summarizes our contractual obligations as of September 30, 2015. Payments due by parted Less than 1 to 3 3 to 6 More than 1 year years years 6 years Total (in thousands) Long-term debt—fatal paitytiX2) S 8,565 $ 17,129 S 17.129 S 206,319 S 249.142 Operating leases(3) 12.938 16,664 5,826 6,250 41.698 Puthese obegabors(4) 2,004 $ 8 — 2,020 TOIal eordreCtual oblgetans(5) S 23507 $ 33,821 $ 22,963 $ 212,569 S 292,880 (1) Long-term debt—related party consists of $79.0 million in notes payable n trees instalments of $26.3 million each due on Secterreer 1, 2021. 2023 and 2026. a 653 million (S59 4 in non at September 30. 2015) note due December 15 2021 and a $47 0 million note due Decanter 15, 2021 at of which wit be repaid in connection with tin ottenng We and certain of our domestic sLosickenes are also guarantors of JAC% senior notes and IACs credit faculty Prior to the closing of the &fern; we wit ro longer be a restricted subsidery d IAC for psposes of its debt facilities. nor will we guararbie any debt of IAC See "Managements chscusuon and analysis of francial condition and results of operettas-uncle), and capital resources " The artists in the table above are inclusive of interest (2) Pro Tonne i.ong.tenn debt prfolinelOn is provided below (3) We lease office space, data eerier tackles and equipment used in connection witho s operabons uxbr various operabrg leases many of which contain etcalabon clauses. In addition. future minimum lease payments include out allocable share of an IAC data carter lease (4) Pt:Chase ObligatqnS pcmanly include etheievng commtments, which commitments are reducible Or terminable such that these comnstments can newer exceed associated revenue by a mearingiut amours (5) We have excluded St 0 1 million in unrecognized tax benefits and related interest from tie table above as we are unable to make a reasonably reliable ester.* of the period in which these habitue moil be pad For addtional information on income taxes. see Note 3 to our audited combined financial statements included elsewhere in this VOSpeCtuS In addition to what is included in the table above, as of September 30, 2015, we may be required to pay, in connection with our acquisitions, up to an additional $170.3 million of cash consideration based on the combination of earnings performance and user growth at the businesses acquired. A substantial portion of the $170.3 million maximum liability ($81.7 million) relates to the contingent consideration arrangement entered into in connection with one acquisition, which has its final measurement period at the end of 2015. Based on current forecasts and the fact that the relevant measurement period for that acquisition Is nearly completed, the Company believes that it will not have to make any further payments with respect to this acquisition. The Company has other contingent consideration arrangements for which it has accrued $28.6 million as of September 30, 2015. We also had $0.3 million of surety bonds outstanding as of September 30. 2015 that could potentially require performance by the Company in the event of demands by third parties or contingent events. hap: vmw sec.env An:hives edger demi 5751691100104746915006431122264511^-t 192015 927:17 AA CONFIDENTIAL - PURSUANT TO FED. R. CRIM. P. 6(e) DB-SDNY-0075183 CONFIDENTIAL SONY GM_00221367 EFTA01378023