Live Nation Entertainment Annual Report 2012

← All annual reports

FY2012 Annual Report · Live Nation Entertainment

Loading PDF…

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-K

⌧ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2012,

OR
(cid:133) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number 001-32601

LIVE NATION ENTERTAINMENT, INC.

(Exact name of registrant as specified in its charter)

Delaware
(State of Incorporation)

20-3247759
(I.R.S. Employer
Identification No.)

9348 Civic Center Drive
Beverly Hills, CA 90210
(Address of principal executive offices, including zip code)
(310) 867-7000
(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class
Common Stock, $.01 Par Value per Share;
Preferred Stock Purchase Rights

Name of Each Exchange on which Registered
New York Stock Exchange

Securities registered pursuant to Section 12(g) of the Act:
None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. ⌧ Yes (cid:133) No
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. (cid:133) Yes ⌧ No
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding

12 months (or for such shorter period that the registrant was required to file such reports), and 2) has been subject to such filing requirements for the past 90
days. ⌧ Yes (cid:133) No

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted

and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit
and post such files). ⌧ Yes (cid:133) No

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§ 229.405 of this chapter) is not contained herein, and will not be
contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. ⌧

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of

“large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer ⌧

Accelerated filer (cid:133)

Non-accelerated filer (cid:133)
(Do not check if a smaller reporting company)

Smaller reporting company (cid:133)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). (cid:133) Yes ⌧ No
On June 30, 2012, the last business day of the registrant’s most recently completed second fiscal quarter, the aggregate market value of the Common Stock beneficially held

by non-affiliates of the registrant was approximately 1,201,000,000 (For purposes hereof, directors, executive officers and 10% or greater stockholders have been deemed
affiliates).

On February 20, 2013, there were 190,742,017 outstanding shares of the registrant’s common stock, $0.01 par value per share, including 2,694,733 shares of unvested

restricted stock awards.

DOCUMENTS INCORPORATED BY REFERENCE
Portions of our Definitive Proxy Statement for the 2013 Annual Meeting of Stockholders, expected to be filed within 120 days of our fiscal year end, are incorporated by

reference into Part III.

LIVE NATION ENTERTAINMENT, INC.
INDEX TO FORM 10-K

PART I

ITEM 1. BUSINESS .............................................................................................................................................................

ITEM 1A. RISK FACTORS ....................................................................................................................................................

ITEM 1B. UNRESOLVED STAFF COMMENTS .................................................................................................................

ITEM 2.

PROPERTIES.........................................................................................................................................................

ITEM 3. LEGAL PROCEEDINGS.......................................................................................................................................

PART II

ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND

ISSUER PURCHASES OF EQUITY SECURITIES ........................................................................................

ITEM 6.

SELECTED FINANCIAL DATA..........................................................................................................................

ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF

OPERATIONS ..................................................................................................................................................

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK .......................................

ITEM 8.

FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA .......................................................................

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
DISCLOSURE...................................................................................................................................................

ITEM 9A. CONTROLS AND PROCEDURES.......................................................................................................................

ITEM 9B. OTHER INFORMATION ......................................................................................................................................

PART III

ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE................................................

ITEM 11. EXECUTIVE COMPENSATION..........................................................................................................................

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND

RELATED STOCKHOLDER MATTERS .......................................................................................................

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE.....

ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES.........................................................................................

PART IV

Page

114

116

ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES ......................................................................................

117

ADA
AEG
AMG
AOI
Azoff Trust
BigChampagne
Cablevision
Clear Channel
Company
Coppel
Cream
CTS
DDA
DOJ
FASB
FCPA
FLMG
Front Line
FTC
Full Circle
GAAP
HARD
IAC
IRS
Liberty Media
Live Nation
LN-Haymon
LN-HS Concerts
Merger

Merger Agreement

MSG
OCI
Paciolan
SEC
Separation

Serviticket
Spincos

TGLP
Ticketmaster

Ticketnet
TicketsNow
T-Shirt Printers
Vector

LIVE NATION ENTERTAINMENT, INC.
GLOSSARY OF KEY TERMS

Americans with Disabilities Act of 1990
Anschutz Entertainment Group
Academy Music Holdings Limited Group
Adjusted operating income (loss)
The Azoff Family Trust of 1997, of which Irving Azoff is co-Trustee
BigChampagne, LLC
Cablevision Systems Corporation
Clear Channel Communications, Inc.
Live Nation Entertainment, Inc. and subsidiaries
Michael Coppel Ventures Pty Ltd
Cream Holdings Limited
CTS Eventim AG
United Kingdom’s Disability Discrimination Act 1995
United States Department of Justice
Financial Accounting Standards Board
Foreign Corrupt Practices Act
FLMG Holdings Corp., a wholly-owned subsidiary of Live Nation
Front Line Management Group, Inc.
Federal Trade Commission
Full Circle Limited Live
United States Generally Accepted Accounting Principles
HARD Events LLC
IAC/InterActiveCorp
United States Internal Revenue Service
Liberty Media Corporation
Live Nation Entertainment, Inc., formerly known as Live Nation, Inc., and subsidiaries
LN-Haymon Ventures, LLC
LN-HS Concerts, LLC
Merger between Live Nation, Inc. and Ticketmaster Entertainment, Inc. announced in

February 2009 and consummated in January 2010

Agreement and Plan of Merger, dated February 10, 2009 and consummated on January 25,

2010, between Live Nation, Inc. and Ticketmaster Entertainment, Inc.

The Madison Square Garden Company
Other comprehensive income (loss)
Paciolan, Inc.
United States Securities and Exchange Commission
The contribution and transfer by Clear Channel of substantially all of its entertainment assets

and liabilities to Live Nation

Serviticket, S.A.
Collective referral to Ticketmaster and other companies spun off from IAC on August 20,

2008

Ticketmaster Group Limited Partnership
For periods prior to May 6, 2010, Ticketmaster means Ticketmaster Entertainment LLC and

its predecessor companies (including without limitation Ticketmaster Entertainment, Inc.);
for periods on and after May 6, 2010, Ticketmaster means the Ticketmaster ticketing
business of the Company

Ticketnet S.A.
TNow Entertainment Group, Inc.
T-Shirt Printers Pty Ltd
Vector Management LLC and Vector West LLC

PART I

“Live Nation” (which may be referred to as the “Company,” “we,” “us” or “our”) means Live Nation Entertainment, Inc. and

its subsidiaries, or one of our segments or subsidiaries, as the context requires.

Special Note About Forward-Looking Statements

Certain statements contained in this Form 10-K (or otherwise made by us or on our behalf from time to time in other reports,
filings with the SEC, news releases, conferences, internet postings or otherwise) that are not statements of historical fact constitute
“forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the
Exchange Act of 1934, as amended, notwithstanding that such statements are not specifically identified. Forward-looking statements
include, but are not limited to, statements about our financial position, business strategy, competitive position, potential growth
opportunities, potential operating performance improvements, the effects of competition, the effects of future legislation or regulations
and plans and objectives of our management for future operations. We have based our forward-looking statements on our beliefs and
assumptions based on information available to us at the time the statements are made. Use of the words “may,” “should,” “continue,”
“plan,” “potential,” “anticipate,” “believe,” “estimate,” “expect,” “intend,” “outlook,” “could,” “target,” “project,” “seek,” “predict,”
or variations of such words and similar expressions are intended to identify forward-looking statements but are not the exclusive
means of identifying such statements.

Forward-looking statements are not guarantees of future performance and are subject to risks and uncertainties that could cause

actual results to differ materially from those in such statements. Factors that could cause actual results to differ from those discussed in
the forward-looking statements include, but are not limited to, those set forth under Item 1A.—Risk Factors as well as other factors
described herein or in our quarterly and other reports we file with the SEC (collectively, “cautionary statements”). Based upon
changing conditions, should any one or more of these risks or uncertainties materialize, or should any underlying assumptions prove
incorrect, actual results may vary materially from those described in any forward-looking statements. All subsequent written and oral
forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by the applicable
cautionary statements. We do not intend to update these forward-looking statements, except as required by applicable law.

ITEM 1.
Our Company

BUSINESS

We believe that we are the largest live entertainment company in the world, connecting more than 250 million fans across all of

our platforms to over 180,000 events in approximately 47 countries in 2012.

We believe we are the largest producer of live music concerts in the world, based on total attendance at Live Nation events as
compared to events of other promoters, connecting nearly 49 million fans to 22,000 events for over 2,300 artists in 2012. Globally,
Live Nation owns, operates, has booking rights for and/or has an equity interest in 139 venues, including House of Blues ® music
venues and prestigious locations such as The Fillmore in San Francisco, the Hollywood Palladium, the Ziggo Dome in Amsterdam
and the O2 Dublin.

We believe we are the world’s leading live entertainment ticketing sales and marketing company, based on the number of tickets

we sold. Ticketmaster provides ticket sales, ticket resale services, and marketing and distribution globally through
www.ticketmaster.com and www.livenation.com, numerous retail outlets and worldwide call centers. Established in 1976, Ticketmaster
serves clients worldwide across multiple event categories, providing ticketing services for leading arenas, stadiums, professional
sports franchises and leagues, college sports teams, performing arts venues, museums and theaters.

We believe we are one of the world’s leading artist management companies based on the number of artists represented. Front

Line and its affiliates manage musical artists and acts primarily in the rock, classic rock, pop and country music genres. As of
December 31, 2012, Front Line and its affiliates had approximately 230 artists on its rosters and over 70 managers providing services
to these artists.

We believe our global network is the world’s largest music marketing network for corporate brands and includes one of the

world’s top five ecommerce websites, based on comparison of gross sales of leading internet retailers. In 2012, we have over
119 million customers in our database based on visitors to www.livenation.com and www.ticketmaster.com and our other online
properties.

Our principal executive offices are located at 9348 Civic Center Drive, Beverly Hills, California 90210 (telephone: 310-867-
7000). Our principal website is www.livenation.com. Live Nation is listed on the New York Stock Exchange, trading under the symbol
“LYV.”

2
Our Strategy

Our strategy is to leverage our leadership position in live entertainment and our relationships with fans, venues, artists and
advertisers to sell more tickets and grow our revenue, earnings and cash flow. We pay artists, venues and teams to secure content and
tickets; we invest in the technology to advance our ticketing, ecommerce and mobile platforms; and we are paid by sponsors and
advertisers that aspire to connect their brands with our passionate fan base.

Our core businesses surrounding the promotion of live events include ticketing and ecommerce, sponsorship, and artist

management. We believe our focus on growing these businesses will increase shareholder value as we continue to build all our
revenue streams and achieve scale economies with our global platforms. We also continue to strengthen our core operations, further
expanding into additional global markets and optimizing our cost structure. Our strategy is to grow and innovate through the initiatives
listed below.

•

Expand our Platform to Sell more Tickets. We will build our fan base and sell more tickets by continuing to build our portfolio
of global festivals, expanding our electronic dance music (EDM) festival and show base, selectively growing into additional top
global music markets and further building our market share in established markets.

• Drive Conversion of Ticket Sales through Social and Mobile Channels. We are focused on selling tickets through a wide set of

sales channels, including social media and mobile, and leveraging our extensive database we have built through
www.livenation.com and www.ticketmaster.com to better reach consumers. We are shifting marketing spend from traditional
media outlets to social media and digital platforms to more effectively reach our fans and drive more ticket sales. We will
continue to develop new tools for mobile devices in additional markets to make it easier for our fans to get information on live
events and conveniently buy and sell tickets.

•

• Grow Sponsorship and Advertising. Our goal is to continue to drive growth in this area and capture a larger share of the music
sponsorship market. We will focus on expanding and developing new relationships with corporate sponsors to provide them
with targeted strategic programs through our unique relationship with fans and artists, our distribution network of venues and
our extensive ticketing operations and online presence. In addition, we have established one of the few ecommerce sites that has
a substantial and growing online advertising platform. We will continue to look for new innovative products and offerings that
give our sponsors and advertisers a unique ability to reach consumers through the power of live music.
Sell more Tickets and Drive Reductions in the Cost to Sell a Ticket. We will continue to invest in our ticketing platforms and
related venue and fan products to strengthen the functionality of our system and drive additional ticket sales while also creating
a more efficient system. We will also continue to deliver differentiated value to content owners and venues leveraging ticket
buyer data to effectively price and market shows, increasing attendance and optimizing revenues.
Build Secondary Ticket Volume. We will grow the volume of secondary tickets sold in partnership with content owners to
provide a trusted environment for fan ticket exchanges. We will deliver an integrated inventory product that will allow our fans
to have a dependable, secure location to come to for all available tickets for an event which they can access both online and via
their mobile devices.

•

Our Assets

•

We believe we have a unique portfolio of assets that is unmatched in the live entertainment industry.
Fans. During 2012, our events were attended by nearly 49 million live music fans. Our database of our fans and their interests
provides us with the means to efficiently market our shows to these fans as well as offer them other music-related products and
services. This fan database is an invaluable asset that we are able to use to provide unique services to our artists and corporate
clients.
Artists. We have extensive relationships with artists ranging from those acts that are just beginning their careers to established
superstars. In 2012, we promoted shows or tours for over 2,300 artists globally. In addition, through our artist management
companies, we manage approximately 230 artists. We believe our artist relationships are a competitive advantage and will help
us pursue our strategy to develop additional ancillary revenue streams around the ticket purchase, live event and the artists
themselves.

• Online Services and Ticketing. We own and operate various branded websites, both in the United States and abroad, which are

customized to reflect services offered in each jurisdiction. Our primary online websites, www.livenation.com and
www.ticketmaster.com, together with our other branded ticketing websites, are designed to promote ticket sales for live events
and to disseminate event and related merchandise information online. Fans can access www.livenation.com and
www.ticketmaster.com directly, from affiliated websites and through numerous direct links from banners and event profiles
hosted by approved third-party websites. We have also launched mobile apps under both Live Nation and Ticketmaster that our
fans can use to access event information and, in some cases, buy tickets to events.

3
• Distribution Network. We believe that our global distribution network of promoters, venues and festivals provides us with a
strong position in the live concert industry. We believe we have one of the largest global networks of live entertainment
businesses in the world, with offices in 72 cities in North America and 24 countries worldwide. In addition, we own, operate,
have booking rights and/or have an equity interest in 139 venues located across six countries as of the end of 2012, making us,
we believe, the second largest operator of music venues in the world. We also believe that we produce one of the largest
networks of music festivals in the world with more than 50 festivals globally. In addition, we believe that our global ticketing
distribution network with one of the largest ecommerce sites on the internet, approximately 9,200 sales outlets and 16 call
centers serving more than 13,000 clients worldwide makes us the largest ticketing network in the industry.
Sponsors. We employ a sales force of approximately 200 people that worked with approximately 800 sponsors during 2012,
through a combination of local venue-related deals and national deals, both in North America and internationally. Our sponsors
include some of the most well-recognized national and global brands including O2, State Farm, Red Bull and Coca-Cola (each of
these brands is a registered trademark of the sponsor).
Employees. At December 31, 2012, we employed approximately 7,100 full-time employees who are dedicated to providing first-
class service to our artists, fans, ticketing clients and corporate sponsors. Many of our employees have decades of experience in
promoting and producing live concerts, ticketing operations, sales and marketing, artist management and live event venue
management.

•

Our History

We were incorporated in Delaware on August 2, 2005 in preparation for the contribution and transfer by Clear Channel of

substantially all of its entertainment assets and liabilities to us. We completed the separation on December 21, 2005, and became a
publicly traded company on the New York Stock Exchange trading under the symbol “LYV.”

On January 25, 2010, we merged with Ticketmaster. Effective on the date of the Merger, Ticketmaster became a wholly-owned

subsidiary of Live Nation and Live Nation, Inc. changed its name to Live Nation Entertainment, Inc.

Our Industry

We operate in five main industries within the live entertainment business, including live music events, venue operations,

ticketing services, sponsorship and advertising sales and artist management and services.

The live music industry includes concert promotion and/or production of music events or tours. Typically, to initiate live music

events or tours, booking agents directly contract with artists to represent them for defined periods. Booking agents then contact
promoters, who will contract with them or directly with artists to arrange events. Booking agents generally receive fixed or percentage
fees from artists for their services. Promoters earn revenue primarily from the sale of tickets. Artists are paid by the promoter under
one of several different formulas, which may include fixed guarantees and/or a percentage of ticket sales or event profits. In addition,
promoters may also reimburse artists for certain costs of production, such as sound and lights. Under guaranteed payment formulas,
promoters assume the risks of unprofitable events. Promoters may renegotiate lower guarantees or cancel events because of
insufficient ticket sales in order to reduce their losses. Promoters can also reduce the risk of losses by entering into global or national
touring agreements with artists and including the right to offset lower performing shows against higher performing shows on the tour
in the determination of overall artist fees.

For music tours, one to four months typically elapse between booking artists and the first performances. Promoters, in
conjunction with artists, managers and booking agents, set ticket prices and advertise events. Promoters market events, sell tickets,
rent or otherwise provide venues and arrange for local production services, such as stages and sets.

Venue operators typically contract with promoters to rent their venues for specific events on specific dates and receive fixed

fees or percentages of ticket sales as rental income. In addition, venue operators provide services such as concessions, parking,
security, ushering and ticket-taking, and receive some or all of the revenue from concessions, merchandise, venue sponsorships,
parking and premium seating.

Ticketing services include the sale of tickets primarily through online channels but also through phone, outlet and box office
channels. Ticketing companies will contract with venues and/or promoters to sell tickets to events over a period of time, generally
three to five years. The ticketing company does not set ticket prices or seating charts for events as this information is given to them by
the venue and/or promoter in charge of the event. The ticketing company generally gets paid a fixed fee per ticket sold or a percentage
of the total ticket service charges. Venues will often also sell tickets through a local box office at the venue using the ticketing
company’s technology; on these box office tickets, the ticketing company will generally not earn a fee. The ticketing company
receives the cash for the ticket sales and related service charges at the time the ticket is sold and periodically remits these receipts to
the venue and/or promoter after deducting their fee. As ticket sales increase, related ticketing operating income generally increases as
well.

4
Ticketing “resale” services refers to the sale of tickets by a holder who originally purchased the tickets from a venue, promoter
or other entity, or a ticketing services provider selling on behalf of a venue, promoter or other entity. Generally, the ticket reseller is
paid a service charge when the ticket is resold and the negotiated ticket value is paid to the holder.

Artist management primarily provides services to music recording artists to manage their careers. The artist manager negotiates
on behalf of the artist and is paid a fee, generally as a percentage of the artist’s earnings. Artist services sells merchandise associated
with musical artists at live performances, to retailers and directly to consumers via the internet and also sells premium ticket packages
and services.

The sponsorship and advertising industry within the live entertainment business involves the sale of international, national,

regional and local advertising campaigns and promotional programs to a variety of companies desiring to advertise or promote their
brand or product. The advertising campaigns typically include venue naming rights, on-site venue signage, online banner
advertisements and exclusive partner rights in various categories such as beverage, hotel and telecommunications. These promotional
programs may include event pre-sales and on-site product activation.

Our Business

Our reportable segments are Concerts, Ticketing, Artist Nation and Sponsorship & Advertising. Prior to 2012, we reported an

eCommerce segment, which is now included in our Ticketing and Sponsorship & Advertising segments. Specifically, all online
advertising and online sponsorships previously reported in the eCommerce segment are now reported in the Sponsorship &
Advertising segment while all other activity has been included in the Ticketing segment. This change was made to be consistent with
how the four key components of the business are now being managed. Information related to these operating segments and other
operations for 2012, 2011 and 2010 is included in Note 13—Segment Data in the Notes to Consolidated Financial Statements in
Item 8.

Concerts. Our Concerts segment principally involves the global promotion of live music events in our owned and/or operated
venues and in rented third-party venues, the operation and management of music venues and the production of music festivals across
the world. During 2012, our Concerts business generated approximately $3.9 billion, or 66.5%, of our total revenue. We promoted
22,000 live music events in 2012, including artists such as Madonna, Lady Gaga, Coldplay, Roger Waters, Bruce Springsteen & the E
Street Band, Van Halen and the Dave Matthews Band and through festivals such as Rock Werchter, Download, Creamfields and
Reading. While our Concerts segment operates year-round, we generally experience higher revenue during the second and third
quarters due to the seasonal nature of shows at our outdoor amphitheaters and festivals, which primarily occur May through
September.

As a promoter, we earn revenue primarily from the sale of tickets and pay artists under one of several formulas, including a
fixed guaranteed amount and/or a percentage of ticket sales or event profits. For each event, we either use a venue we own and/or
operate, or rent a third-party venue. Revenue is generally related to the number of events, volume of ticket sales and ticket prices.
Event costs such as artist fees and production service expenses are included in direct operating expenses and are typically substantial
in relation to the revenue. As a result, significant increases or decreases in promotion revenue do not typically result in comparable
changes to operating income.

As a venue operator, we generate revenue primarily from the sale of concessions, parking, premium seating, rental income,

venue sponsorships and ticket rebates or service charges earned on tickets sold through our internal ticketing operations or by third
parties under ticketing agreements. In our amphitheaters, the sale of concessions is outsourced and we receive a share of the net
revenue from the concessionaire which is recorded in revenue with no significant direct operating expenses associated with it.
Revenue generated from venue operations typically have a higher margin than promotion revenue and therefore typically have a more
direct relationship to operating income.

As a festival operator, we typically book artists, secure festival sites, provide for third-party production services, sell tickets and

advertise events to attract fans. We also arrange for third-parties to provide operational services as needed such as concessions,
merchandising and security. We earn revenue from the sale of tickets and typically pay artists a fixed guaranteed amount. We also
earn revenue from the sale of concessions, camping fees, festival sponsorships and ticket rebates or service charges earned on tickets
sold. For each event, we either use a festival site we own or rent a third-party festival site. Revenue is generally related to the number
of events, volume of ticket sales and ticket prices. Event costs such as artist fees and production service expenses are included in direct
operating expenses and are typically substantial in relation to the revenue. As a result, significant increases or decreases in festival
promotion revenue will generally result in comparable changes to operating income.

5
Ticketing. Our Ticketing segment is primarily an agency business that sells tickets for events on behalf of our clients and retains

a convenience charge and order processing fee for our services. We sell tickets for our events and also for third-party clients across
multiple live event categories, providing ticketing services for leading arenas, stadiums, amphitheaters, music clubs, concert
promoters, professional sports franchises and leagues, college sports teams, performing arts venues, museums and theaters. We sell
tickets through a combination of websites, telephone services, mobile devices and ticket outlets. During the year ended December 31,
2012, we sold 78%, 6%, 4% and 12% of primary tickets through these channels, respectively. Our Ticketing segment also manages
our online activities including enhancements to our websites and bundled product offerings. During 2012, our Ticketing business
generated approximately $1.4 billion, or 23.6%, of our total revenue, which excludes the face value of tickets sold. Through all of our
ticketing services, we sold over 148 million tickets in 2012 and sold an additional 108 million tickets through our venue clients’ box
offices. Our ticketing sales are impacted by fluctuations in the availability of events for sale to the public, which may vary depending
upon event scheduling by our clients.

We generally enter into written agreements with individual clients to provide primary ticketing services for specified multi-year

periods, typically ranging from three to five years. Pursuant to these agreements, clients generally determine and then tell us what
tickets will be available for sale, when such tickets will go on sale to the public and what the ticket face price will be. Agreements
with venue clients generally grant us the right to sell tickets for all events presented at the relevant venue for which tickets are made
available to the general public. Agreements with promoter clients generally grant us the right to sell tickets for all events presented by
a given promoter at any venue, unless that venue is already covered by an existing exclusive agreement with our ticketing business or
another ticketing service provider. Where we have exclusive contracts, clients may not utilize, authorize or promote the services of
third-party ticketing companies or technologies while under contract with us. While we generally have the right to sell a substantial
portion of our clients’ tickets, venue and promoter clients often sell and distribute group sales and season tickets in-house. In addition,
under many written agreements between promoters and our clients, the client often allocates certain tickets for artist, promoter, agent
and venue use and does not make those tickets available for sale by us. We also generally allow clients to make a certain limited
number of tickets available for sale through fan clubs, or other similar arrangements, from which we generally derive no revenue
unless selected by the club to facilitate the sales. As a result, we do not sell all of our clients’ tickets and the amount of tickets that we
sell varies from client to client and from event to event, and varies as to any single client from year to year.

We currently offer ticket resale services through TicketsNow (in the United States and Canada), our TicketExchange service (in
the United States, Europe and Canada) and GET ME IN! (in the United Kingdom). Through TicketsNow and GET ME IN!, we enter
into listing agreements with ticket resellers to post ticket inventory for sale at a purchase price equal to a ticket resale price determined
by the ticket reseller plus an amount equal to a percentage of the ticket resale price and a pre-determined service fee. We remit the
ticket resale price to the ticket resellers and retain the remainder of the purchase price. While we do not generally acquire tickets for
sale on our own behalf, we may do so from time to time on a limited basis. In addition to enabling premium primary ticket sales, the
TicketExchange service allows consumers to resell and purchase tickets online for certain events that were initially sold for our venue
clients who elect to participate in the TicketExchange service. Sellers and buyers each pay a fee that has been negotiated with the
relevant client, a portion of which is shared with the client.

Artist Nation. Our Artist Nation segment primarily provides management services to music artists in exchange for a commission
on the earnings of these artists. Our Artist Nation segment also sells merchandise associated with musical artists at live performances,
to retailers and directly to consumers via the internet and also provides other services to artists. During 2012, our Artist Nation
business generated approximately $400 million, or 6.9%, of our total revenue. Revenue earned from our Artist Nation segment is
impacted to a large degree by the touring schedules of the artists we represent. Generally, we experience higher revenue during the
second and third quarters as the period from May through September tends to be a popular time for touring events.

Sponsorship & Advertising. Our Sponsorship & Advertising segment employs a sales force that creates and maintains

relationships with sponsors, through a combination of strategic, international, national and local opportunities for businesses to reach
customers through our concert, venue, artist relationship and ticketing assets, including advertising on our websites. We work with our
corporate clients to help create marketing programs that promote their brand and/or product. During 2012, our Sponsorship &
Advertising business generated approximately $248 million, or 4.3%, of our total revenue.

We believe that we have a unique opportunity to connect the music fan to corporate sponsors and therefore seek to optimize this

relationship through strategic sponsorship programs. We continue to also pursue the sale of national and local sponsorships, both
domestically and internationally, and placement of advertising, including signage, online advertising and promotional programs. Many
of our venues have venue naming rights sponsorship programs. We believe national and international sponsorships allow us to
maximize our network of venues and to arrange multi-venue branding opportunities for advertisers. Our sponsorship programs include
companies such as Starwood, American Express, Vodafone, Anheuser Busch, Citi and Hertz (each of the preceding brands is a
registered trademark of the sponsor). Our local and venue-focused sponsorships include venue signage, promotional programs, on-site
activation, hospitality and tickets, and are derived from a variety of companies across various industry categories.

6
2012 Acquisitions

The following list includes some of our larger acquisitions during 2012:

Coppel — In April 2012, our Concerts segment acquired a 51% interest in Michael Coppel Ventures Pty Ltd, a concert

promotion business in Australia and New Zealand.

Cream — In May 2012, our Concerts segment acquired a 90% interest in Cream Holdings Limited, an electronic dance music

festival promoter based in the United Kingdom.

HARD — In June 2012, our Concerts segment acquired HARD Events LLC, an electronic dance music festival promoter based

in Los Angeles, California.

Live Nation Venue Details

•

In the live entertainment industry, venue types generally consist of:
Stadiums—Stadiums are multi-purpose facilities, often housing local sports teams. Stadiums typically have 30,000 or more
seats. Although they are the largest venues available for live music, they are not specifically designed for live music. At
December 31, 2012, we had booking rights to two stadiums in North America.
Amphitheaters—Amphitheaters are generally outdoor venues with between 5,000 and 30,000 seats that are used primarily in the
summer season. We believe they are popular because they are designed specifically for concert events, with premium seat
packages and better lines of sight and acoustics. At December 31, 2012, we owned eight, leased 28, operated six and had
booking rights for seven amphitheaters located in North America.
Arenas—Arenas are indoor venues that are used as multi-purpose facilities, often housing local sports teams. Arenas typically
have between 5,000 and 20,000 seats. Because they are indoors, they are able to offer amenities that other similar-sized outdoor
venues cannot, such as luxury suites and premium club memberships. As a result, we believe they have become increasingly
popular for higher-priced concerts aimed at audiences willing to pay for these amenities. At December 31, 2012, we owned one,
leased three, operated four and had booking rights for three arenas located in North America, the United Kingdom, Ireland, the
Netherlands and Italy.

• Music Theaters—Music theaters are indoor venues that are built primarily for music events. These venues typically have a
capacity between 1,000 and 6,500. Because these venues have a smaller capacity than an amphitheater, they do not offer as
much economic upside on a per show basis. However, because music theaters can be used year-round, unlike most
amphitheaters, they can generate annual profits similar to those of an amphitheater. Music theaters represent less risk to concert
promoters because they have lower fixed costs associated with hosting a concert and may provide a more appropriately-sized
venue for developing artists and more artists in general. At December 31, 2012, we owned seven, leased 25, operated three, had
booking rights for seven and an equity interest in one music theaters located in North America and the United Kingdom.
• Clubs—Clubs are indoor venues that are built primarily for music events but may also include comedy clubs. These venues

typically have a capacity of less than 1,000 and often without full fixed seating. Because of their small size, they do not offer as
much economic upside, but they also represent less risk to a concert promoter because they have lower fixed costs associated
with hosting a concert and also may provide a more appropriate sized venue for developing artists. Clubs can also be used year-
round and can therefore generate higher profits for the year, even though per show profits are lower. At December 31, 2012, we
owned three, leased ten and had booking rights for three clubs in North America and the United Kingdom.

• House of Blues—House of Blues venues are indoor venues that offer customers an integrated live music and dining experience.
The live music halls are specially designed to provide optimum acoustics and typically can accommodate between 1,000 to
2,000 guests. A full-service restaurant and bar is located adjacent to the live music hall. We believe that the high quality of the
food, service and unique atmosphere in our restaurants attracts customers to these venues independently from an entertainment
event and generates a significant amount of repeat business from local customers. At December 31, 2012, we owned two and
leased ten House of Blues venues located in North America. One of the House of Blues venues is comprised of two buildings
where we own one and lease the other. We have included this venue as an owned venue.
Festival Sites—Festival sites are outdoor locations used primarily in the summer season to stage day-long or multi-day concert
events featuring several artists. Depending on the location, festival site capacities can range from 10,000 to 120,000. We believe
they are popular because of the value provided to the fan by packaging several artists for a full-day or multi-day event. While
festival sites only host a few events each year, they can provide higher operating income because we are able to generate income
from many different services provided at the event and they have lower costs associated with producing the event and
maintaining the site. At December 31, 2012, we owned four festival sites located in North America and the United Kingdom.
One of the festival sites is comprised of two parcels of land where we own one and lease the other. We have included this site as
owned.

•

7
•

Theatrical Theaters—Theatrical theaters are generally indoor venues that are built specifically for theatrical events, with
substantial aesthetic and acoustic consideration. These venues typically have less than 5,000 seats. Additionally, given their size,
they are able to host events aimed at niche audiences. At December 31, 2012, we leased one theatrical theater located in North
America and operated one in Ireland.

Venues

At December 31, 2012, we owned, leased, operated, had booking rights for and/or had an equity interest in the following

domestic and international venues primarily used for music events:

DMA®
Region
Rank
(1)
1

Market and Venue
NEW YORK, NY
PNC Bank Arts Center

Nikon at Jones Beach Theater

NYCB Theatre at Westbury

The Paramount
Irving Plaza Powered by Klipsch

Gramercy Theatre

Roseland Ballrooom
Foxwoods Theatre

Union County Performing Arts Center

LOS ANGELES, CA
San Manuel Amphitheater

Verizon Wireless Amphitheater

Gibson Amphitheatre at Universal

CityWalk

Hollywood Palladium

The Wiltern

House of Blues—Sunset Strip

House of Blues—Anaheim

CHICAGO, IL
First Midwest Bank Amphitheatre
House of Blues—Chicago
Charter One Pavilion at Northerly Island

Bottom Lounge

Type of Venue

Live Nation’s Interest

Amphitheater

Music Theater

Music Theater
Club

Club

Club
Theatrical Theater

Music Theater

22-year lease that expires
December 31, 2017
20-year license agreement that expires
December 31, 2019
43-year lease that expires
December 31, 2034
Booking agreement
10-year lease that expires
October 31, 2016
10-year lease that expires
December 31, 2016
Booking agreement
40-year lease that expires
December 31, 2038

Amphitheater

Music Theater

House of Blues

Amphitheater
House of Blues
Amphitheater

Club

Booking agreement

25-year lease that expires
June 30, 2018
20-year lease that expires
February 28, 2017
15-year lease that expires
September 9, 2014
20-year lease that expires
January 31, 2027
15-year lease that expires
June 30, 2020
13-year lease that expires
May 10, 2025
5-year lease that expires
January 31, 2016

Owned
Owned
1-year lease that expired December 31,
2011 (currently operating and negotiating
new terms)
Booking agreement

Estimated
Seating
Capacity

17,500

14,400

2,800

1,500
1,000

600

3,700
1,800

1,300

65,000

16,300

6,200

3,500

2,300

1,000

28,600
1,300
8,500

300

Market and Venue
PHILADELPHIA, PA
Susquehanna Bank Center

Tower Theater
Theatre of the Living Arts
Chestnut Street Theatre

Festival Pier (at Penn’s Landing)

River Stage at Great Plaza—Penn’s

Landing

DALLAS—FORT WORTH, TX
Gexa Energy Pavillion

House of Blues—Dallas

Morton H. Meyerson Symphony Center

Palladium Ballroom
SAN FRANCISCO—

OAKLAND—SAN JOSE, CA

Shoreline Amphitheatre

Sleep Train Pavilion at Concord

The Fillmore

Nob Hill Masonic Center

Punch Line Comedy Club—San Francisco

Cobb’s Comedy Club

BOSTON, MA
Comcast Center
Bank of America Pavilion

Orpheum Theatre—Boston

House of Blues—Boston

Paradise Rock Club

Brighton Music Hall

WASHINGTON, DC
Jiffy Lube Live
Warner Theatre

The Fillmore Silver Spring

DMA®
Region
Rank
(1)
4

Type of Venue

Live Nation’s Interest

Amphitheater

Music Theater
Club
Theatrical
Theater
Amphitheater

Amphitheater

House of Blues

Music Theater

Amphitheater

Music Theater

Club

Amphitheater
Amphitheater

Music Theater

House of Blues

Club

31-year lease that expires
September 29, 2025
Owned
Owned
Owned (currently not in operation)

3-year license agreement that expires
September 30, 2013
2-year license agreement that expires
September 30, 2013

30-year lease that expires
December 31, 2018
15-year lease that expires
May 31, 2027

Booking agreement
Booking agreement

15-year lease that expires
December 31, 2020
1-year management agreement that
expires December 31, 2013
10-year lease that expires
August 31, 2022
18-year lease that expires
March 31, 2028
5-year lease that expires
September 15, 2016
10-year lease that expires
October 31, 2015

Owned
Indefinite license agreement that
expires 18 months after notification
that pier is to be occupied for water
dependent use
15-year operating agreement that expires
December 31, 2020
20-year lease that expires
February 28, 2029
10-year lease that expires
May 31, 2018
10-year lease that expires
January 1, 2021

Amphitheater
Music Theater

Music Theater

Owned
1-year lease that expires
January 1, 2014
20-year lease that expires
August 30, 2021

Estimated
Seating
Capacity

25,000

3,100
800
2,400

6,500

3,500

20,100

1,600

2,100

3,000

22,000

12,500

1,200

3,300

500

200

19,900
4,900

2,700

2,400

800

300

22,500
1,900

2,000

Market and Venue
ATLANTA, GA
Aaron’s Amphitheatre at Lakewood

Chastain Park Amphitheatre

The Tabernacle

HOUSTON, TX
Cynthia Woods Mitchell Pavilion
Bayou Music Center

House of Blues—Houston

DETROIT, MI
The Fillmore Detroit

Saint Andrew’s Hall
SEATTLE—TACOMA, WA
White River Amphitheatre

PHOENIX, AZ
Ashley Furniture Home Store Pavilion

Comerica Theatre

TAMPA—ST PETERSBURG—

SARASOTA, FL

1-800-ASK-GARY Amphitheatre at the

Florida State Fairgrounds
MIAMI—FT LAUDERDALE, FL
Klipsch Amphitheatre at Bayfront Park

The Fillmore Miami Beach at the Jackie

Gleason Theater
Revolution Live
DENVER, CO
Comfort Dental Amphitheatre

Fillmore Auditorium
CLEVELAND—AKRON, OH
Blossom Music Center

House of Blues—Cleveland

Jacobs Pavilion at Nautica
ORLANDO—DAYTON BEACH—

MELBOURNE, FL
House of Blues—Orlando

DMA®
Region
Rank
(1)
9

Type of Venue

Live Nation’s Interest

Amphitheater

Music Theater

Amphitheater
Music Theater

House of Blues

Music Theater

Club

Amphitheater

Music Theater

35-year lease that expires
December 31, 2034
5-year lease that expires
December 31, 2015
20-year lease that expires
January 31, 2018

Booking agreement
10-year lease that expires
December 31, 2022
10-year lease that expires
October 31, 2018

15-year lease that expires
January 31, 2018
Owned

25-year management agreement that
expires October 31, 2027

60-year lease that expires
June 30, 2049
10-year lease that expires
December 31, 2016

Amphitheater

15-year lease that expires
December 31, 2018

Amphitheater

Music Theater

Club

Amphitheater

Music Theater

Amphitheater

House of Blues
Amphitheater

10-year management agreement that
expires December 31, 2018
10-year management agreement that
expires August 31, 2017
Booking agreement

1-year lease that expires
December 31, 2013
Owned

15-year lease that expires
October 31, 2014
20-year lease that expires
October 31, 2024
Booking agreement

House of Blues

6 month lease that expires
March 31, 2013

Estimated
Seating
Capacity

19,000

6,400

2,500

16,500
2,900

1,500

2,900

800

20,000

5,500

20,000

5,000

2,700

1,300

16,800

3,600

19,600

1,200
4,500

2,100

Market and Venue
SACRAMENTO—

STOCKTON—MODESTO, CA

Sleep Train Amphitheatre
Punch Line Comedy Club—Sacramento

ST. LOUIS, MO
Verizon Wireless Amphitheater—St.

Louis
The Pageant
PITTSBURGH, PA
First Niagara Pavilion

RALEIGH—DURHAM, NC
Time Warner Cable Music Pavilion at

Walnut Creek
Red Hat Amphitheater
CHARLOTTE, NC
Verizon Wireless Amphitheatre Charlotte

Time Warner Cable Uptown Amphitheater

Charlotte

The Fillmore Charlotte

INDIANAPOLIS, IN
Klipsch Music Center
Farm Bureau Insurance Lawn at White

River State Park

Murat Theatre at Old National Centre

SAN DIEGO, CA
Cricket Wireless Amphitheatre

SDSU Open Air Theatre
Viejas Arena
House of Blues San—Diego

HARTFORD—NEW HAVEN, CT
Comcast Theatre

Rentschler Field
Mohegan Sun Arena
Toyota Presents Oakdale Theatre
KANSAS CITY, MO
Starlight Theatre
MILWAUKEE, WI
Alpine Valley Music Theatre

DMA®
Region
Rank
(1)
20

Type of Venue

Live Nation’s Interest

Amphitheater

Owned

Club

5-year lease that expires
December 31, 2017

Amphitheater
Music Theater

Owned
50% equity interest

Amphitheater

Amphitheater
Amphitheater

Amphitheater

Amphitheater
Music Theater

45-year lease that expires
December 31, 2035

40-year lease that expires
October 31, 2030
Booking agreement

Owned
10-year lease that expires
June 12, 2019
10-year lease that expires
June 12, 2019

Amphitheater
Amphitheater

Owned
Booking agreement

Music Theater

Amphitheater

Amphitheater
Arena
House of Blues

Amphitheater

Stadium
Arena
Music Theater

50-year lease that expires
September 4, 2045

20-year lease that expires
October 31, 2023
Booking agreement
Booking agreement
15-year lease that expires
May 31, 2020

40-year lease that expires
September 13, 2034
Booking agreement
Booking agreement
Owned

Music Theater

Booking agreement

Amphitheater

21-year management agreement that
expires
December 31, 2019

Estimated
Seating
Capacity

18,500

100

21,000
2,300

23,100

20,000
5,400

18,800

5,000
2,000

24,400

6,000

2,500

19,500

4,800
12,500
1,100

24,200

34,300
9,000
4,600

8,100

35,300

Market and Venue
CINCINNATI, OH
Riverbend Music Center
PNC Pavilion
Bogart’s

WEST PALM BEACH—
FORT PIERCE, FL

Cruzan Amphitheatre

LAS VEGAS, NV
House of Blues—Las Vegas

BIRMINGHAM, AL
Oak Mountain Amphitheatre

HARRISBURG—LANCASTER—

LEBANON—YORK, PA

HERSHEYPARK Stadium
Sands Bethlehem Event Center
NORFOLK—PORTSMOUTH—

NEWPORT NEWS, VA

Farm Bureau Live at Virginia Beach

ALBUQUERQUE—
SANTA FE, NM

Hard Rock Casino Albuquerque Presents

the
Pavilion

Sandia Casino Amphitheater
LOUISVILLE, KY
The Louisville Palace
NEW ORLEANS, LA
House of Blues —New Orleans

BUFFALO, NY
Darien Lake Performing Arts Center

WILKES BARRE—SCRANTON, PA
Toyota Pavilion at Montage Mountain

ALBANY—SCHENECTADY—
TROY, NY
Saratoga Performing Arts Center

DMA®
Region
Rank
(1)
35

FLORENCE—MYRTLE BEACH, SC
House of Blues—Myrtle Beach

103

Type of Venue

Live Nation’s Interest

Amphitheater
Amphitheater
Club

Booking agreement
Booking agreement
10-year lease that expires
January 31, 2023

Amphitheater

10-year lease that expires
December 31, 2015

House of Blues

15-year lease that expires
January 1, 2014

Amphitheater

Owned

Stadium
Music Theater

Booking agreement
Booking agreement

Amphitheater

30-year lease that expires
December 31, 2025

Amphitheater

20-year lease that expires April 16, 2021

Music Theater

Booking agreement

Music Theater

Owned

House of Blues

One building owned and one building
under 35-year lease that expires
October 31, 2027

Amphitheater

25-year lease that expires
October 15, 2020

Amphitheater

10-year lease that expires
December 31, 2021

Amphitheater

5-year lease that expires
September 1, 2014

House of Blues

27-year lease that expires
May 31, 2025

Estimated
Seating
Capacity

20,500
4,000
1,500

19,300

1,800

10,600

30,000
3,500

20,000

12,000
4,200

2,700

1,000

21,800

17,500

25,200

2,000

Market and Venue
YAKIMA—PASCO—RICHLAND—
KENNEWICK, WA
The Gorge Amphitheatre

WHEELING, WV—STEUBENVILLE,

Jamboree in the Hills Festival Site
TORONTO, CANADA
Molson Canadian Amphitheatre

VANCOUVER, CANADA
Rogers Arena
Commodore Ballroom

BIRMINGHAM, ENGLAND
O2 Academy Birmingham

BOURNEMOUTH, ENGLAND
O2 Academy Bournemouth

BRIGHTON, ENGLAND
O2 Academy Brighton

BRISTOL, ENGLAND
O2 Academy Bristol

LEEDS, ENGLAND
O2 Academy Leeds

Leeds Festival Site
LIVERPOOL, ENGLAND
Nation

O2 Academy Liverpool

LONDON, ENGLAND
Wembley Arena

O2 Academy Brixton

O2 Academy Shepherds Bush Empire

O2 Academy Islington

MANCHESTER, ENGLAND
O2 Apollo Manchester
NEWCASTLE, ENGLAND
O2 Academy Newcastle

DMA®
Region
Rank
(1)
122

158

N/A

Type of Venue

Live Nation’s Interest

Amphitheater

20-year lease that expires
October 31, 2023

Festival Site

Owned

Amphitheater

Arena
Club

Music Theater

10-year lease that expires
December 31, 2020

Booking agreement
15-year lease that expires
July 31, 2014

27-year lease that expires
September 25, 2034

35-year lease that expires
July 17, 2034

Music Theater

30-year lease that expires
February 15, 2037 (currently not in

operation)

Music Theater

25-year lease that expires
December 25, 2023

Music Theater

Festival Site

25-year lease that expires
June 23, 2026
Owned

Club

Music Theater

Arena

Music Theater

Music Theater
Music Theater

3-year lease that expired
August 31, 2012 (currently operating and
negotiating new terms)
34-year lease that expires
January 22, 2037

7-year management agreement
that expires February 11, 2013
98-year lease that expires
December 24, 2024

Owned
25-year lease that expires
June 20, 2028

Music Theater

Owned

Music Theater

99-year lease that expires
March 24, 2021

Estimated
Seating
Capacity

20,000

N/A

16,000

13,000
1,100

3,000

1,800

2,500

1,900

2,300

N/A

2,900

1,200

12,800
4,900

2,000
800

3,500

2,000

SOUTHAMPTON, ENGLAND
Southampton Guildhall

N/A

Music Theater

AMSTERDAM, THE NETHERLANDS N/A
Heineken Music Hall

Market and Venue
NOTTINGHAM, ENGLAND
Media

OXFORD, ENGLAND
O2 Academy Oxford

READING, ENGLAND
Little John’s Farm
SHEFFIELD, ENGLAND
Motorpoint Arena

O2 Academy Sheffield

Ziggo Dome

GLASGOW, SCOTLAND
O2 Academy Glasgow
O2 ABC Glasgow

King Tuts Wah Wah Hut
Universe

Balado Airfield (T in the Park)

CARDIFF, WALES
Motorpoint Arena Cardiff

DUBLIN, IRELAND
The O2 Dublin
Bord Gáis Energy Theatre

TURIN, ITALY
Palasport Olimpico

Palavela

DMA®
Region
Rank
(1)
N/A

N/A

Type of Venue

Live Nation’s Interest

Club

25-year lease agreement that expires on
September 30, 2023 (currently not in
operation)

Music Theater

25-year lease that expires
October 30, 2031

Festival Site

Owned

Arena

Music Theater

5-year management agreement that
expires
March 31, 2016
35-year lease that expires
January 9, 2043

10-year management agreement that
expires February 10, 2013

Arena

20-year lease that expires
December 31, 2027
20-year lease that expires
June 1, 2032

N/A

Music Theater
Music Theater

Club
Club

Festival Site

Owned
40-year lease that expires
August 24, 2039
Owned
25-year lease agreement that expires on
July 29, 2017 (currently not in operation)
One parcel owned/one parcel under a
1-year lease that expires August 1, 2013

Arena

137-year lease that expires
December 25, 2131

Arena
Theatrical Theater

Owned
5-year management agreement that
expires December 31, 2015

Arena

30-year management agreement that
expires November 25, 2039
30-year management agreement that
expires November 25, 2039

Estimated
Seating
Capacity

1,400

1,000

N/A

11,300

2,400

1,800

5,500

15,700

2,500
1,600

300
200

N/A

6,700

13,000
2,000

12,500

8,300

(1) DMA® region refers to a United States designated market area as of September 22, 2012. At that date, there were 210 DMA®s.

DMA® is a registered trademark of Nielsen Media Research, Inc.

The following table summarizes the number of venues by type that we owned, leased, operated, had booking rights for and/or

had an equity interest in as of December 31, 2012:

Venue Type

Capacity

Owned

Leased

Operated

Booking
Rights

Equity
Interest

Total

Stadium ...................... More than 30,000
5,000 - 30,000
Amphitheater .............
5,000 - 20,000
Arena..........................
Music Theater ............
1,000 - 6,500
Less than 1,000
Club............................
1,000 - 2,000
House of Blues...........
Festival Site ...............
N/A
Theatrical Theater ......
Less than 5,000
Total venues ..........

Venues not currently in operation..................

Competition

-
8
1
7
3
2
4
-
25

-
28
3
25
10
10
-
1
77

-
6
4
3
-
-
-
1
14

2
7
3
7
3
-
-
-
22

-
-
-
1
-
-
-
-
1

2
49
11
43
16
12
4
2
139

Competition in the live entertainment industry is intense. We believe that we compete primarily on the basis of our ability to

deliver quality music events, sell tickets and provide enhanced fan and artist experiences. We believe that our primary strengths
include:
•
•
•
•
•
•
•
•
•

the quality of service delivered to our artists, fans and corporate sponsors;
our track record in promoting and producing live music events and tours both domestically and internationally;
artist relationships;
our global footprint;
ticketing software and services;
our ecommerce site and associated database;
distribution platform (venues);
the scope and effectiveness in our expertise of marketing and sponsorship programs; and
our financial stability.

Although we believe that our products and services currently compete favorably with respect to such factors, we cannot provide

any assurance that we can maintain our competitive position against current and potential competitors, especially those with
significantly greater brand recognition, or financial, marketing, support, technical and other resources.

In the markets in which we promote music concerts, we face competition from both promoters and venue operators. We believe

that barriers to entry into the promotion services business are low and that certain local promoters are increasingly expanding the
geographic scope of their operations.

Our main competitors in the live music industry include AEG and C3 Presents, in addition to numerous smaller regional
companies and various casinos in North America and Europe. Anschutz Entertainment Group operates under a number of different
names including AEG Live, Concerts West and The Messina Group. Some of our competitors in the live music industry have a
stronger presence in certain markets, have access to other sports and entertainment venues and may have greater financial resources in
those markets, which may enable them to gain a greater competitive advantage in relation to us.

In markets where we own and/or operate a venue, we compete with other venues to serve artists likely to perform in that general

region. Consequently, touring artists have various alternatives to our venues when scheduling tours. Our main competitors in venue
management include SMG, AEG and The Nederlander Organization in addition to numerous smaller regional companies in North
America and Europe. Some of our competitors in venue management have a greater number of venues in certain markets and may
have greater financial resources in those markets.

The ticketing services industry includes the sale of tickets primarily through online channels, but also through telephone
services, mobile devices and ticket outlets. As online ticket purchases increase, related ticketing costs generally decrease, which has
made it easier for technology-based companies to offer primary ticketing services and standalone, automated ticketing systems that
enable venues to perform their own ticketing services or utilize self-ticketing systems. In the online environment, we compete with
other websites, online event sites and ticketing companies to provide event information, sell tickets and provide other online services
such as fan clubs and artist websites.

We experience competition from other national, regional and local primary ticketing service providers to secure new venues and

to reach fans for events. Resale ticketing services and the consolidation of the resale industry, which historically had been more
fragmented and consisted of a significant number of local resellers with limited inventory selling through traditional storefronts, has
created more aggressive buying of primary tickets whereby brokers are using bot technology to attempt to buy the best tickets when
they go on sale. The internet allows fans and other ticket resellers to reach a vastly larger audience through the aggregation of
inventory on online resale websites and marketplaces, and provides consumers with more convenient access to tickets for a larger
number and greater variety of events. We also face significant and increasing competition from companies that sell self-ticketing
systems, as well as from venues that choose to integrate self-ticketing systems into their existing operations or acquire primary
ticketing service providers. Our main competitors include primary ticketing companies such as Tickets.com, AXS, Paciolan, Veritix
and CTS Eventim, online and event companies such as Eventbrite, eTix and Ticketfly and secondary ticketing companies such as
StubHub.

In the artist management business, we compete with other artist managers both at larger talent representation companies, such as

Red Light Management, as well as smaller artist management companies and individuals. In the artist services business, we compete
with companies typically only involved in one or a few of the services we provide. Some of these competitors include Bill Young
Productions, Bravado, Artist Arena and Global Merchandising.

Our main competitors at the local market level for sponsorships and advertising dollars include local sports teams, which often
offer state of the art venues and strong local media packages. Additionally, our competitors locally can include festivals, theme parks
and other local events. On the national level, our competitors include the major sports leagues that all sell sponsorships combined with
significant national media packages.

Government Regulations

We are subject to federal, state and local laws, both domestically and internationally, governing matters such as:

•

construction, renovation and operation of our venues;
licensing, permitting and zoning, including noise ordinances;
human health, safety and sanitation requirements;
the service of food and alcoholic beverages;

•
• working conditions, labor, minimum wage and hour, citizenship and employment laws;
•

compliance with the ADA and the DDA;
historic landmark rules;
compliance with United States FCPA, the United Kingdom Bribery Act 2010 and similar regulations in other countries;
hazardous and non-hazardous waste and other environmental protection laws;
sales and other taxes and withholding of taxes;
privacy laws and protection of personally identifiable information;

•
• marketing activities via the telephone and online; and
•

primary ticketing and ticket resale services.

We believe that we are in material compliance with these laws. The regulations relating to our food service in our venues are

many and complex. A variety of regulations at various governmental levels relating to the handling, preparation and serving of food,
the cleanliness of food production facilities and the hygiene of food-handling personnel are enforced primarily at the local public
health department level.

We also must comply with applicable licensing laws, as well as state and local service laws, commonly called dram shop
statutes. Dram shop statutes generally prohibit serving alcoholic beverages to certain persons such as an individual who is intoxicated
or a minor. If we violate dram shop laws, we may be liable to third parties for the acts of the customer. Although we generally hire
outside vendors to provide these services at our larger operated venues and regularly sponsor training programs designed to minimize
the likelihood of such a situation, we cannot guarantee that intoxicated or minor customers will not be served or that liability for their
acts will not be imposed on us.

We are also required to comply with the ADA, the DDA and certain state statutes and local ordinances that, among other things,

require that places of public accommodation, including both existing and newly constructed venues, be accessible to customers with
disabilities. The ADA and the DDA require that venues be constructed to permit persons with disabilities full use of a live
entertainment venue. The ADA and the DDA may also require that certain modifications be made to existing venues to make them
accessible to customers and employees who are disabled. In order to comply with the ADA, the DDA and other similar ordinances, we
may face substantial capital expenditures in the future.

We are required to comply with the laws of the countries we operate in and also the United States FCPA and the United

Kingdom Bribery Act 2010 regarding anti-bribery regulations. These regulations make it illegal for us to pay, promise to pay or
receive money or anything of value to, or from, any government or foreign public official for the purpose of directly or indirectly
obtaining or retaining business. This ban on illegal payments and bribes also applies to agents or intermediaries who use funds for
purposes prohibited by the statute.

We are required to comply with federal, state and international laws regarding privacy and the storing, sharing, use, disclosure

and protection of personally identifiable information and user data. Specifically, personally identifiable information is increasingly
subject to legislation and regulations in numerous jurisdictions around the world, the intent of which is to protect the privacy of
personal information that is collected, processed and transmitted in or from the governing jurisdiction.

From time to time, governmental bodies have proposed legislation that could have an effect on our business. For example, some
legislatures have proposed laws in the past that would impose potential liability on us and other promoters and producers of live music
events for entertainment taxes and for incidents that occur at our events, particularly relating to drugs and alcohol. More recently,
some jurisdictions have proposed legislation that would restrict ticketing methods, mandate ticket inventory disclosure and attack
current policies governing season tickets for sports teams.

In addition, we and our venues are subject to extensive environmental laws and regulations relating to the use, storage, disposal,

emission and release of hazardous and non-hazardous substances, as well as zoning and noise level restrictions which may affect,
among other things, the hours of operations of our venues.

Intellectual Property

We create, own and distribute intellectual property worldwide. It is our practice to protect our trademarks, brands, copyrights,
patents and other original and acquired works, ancillary goods and services. Our trademarks include, among others, the word marks
“Live Nation,” “Ticketmaster,” “House of Blues” and “The Fillmore,” as well as the Live Nation, Ticketmaster, House of Blues and
The Fillmore logos. We have registered our most significant trademarks in numerous foreign countries. We believe that our
trademarks and other proprietary rights have significant value and are important to our brand-building efforts and the marketing of our
services. We cannot predict, however, whether steps taken by us to protect our proprietary rights will be adequate to prevent
misappropriation of these rights.

Employees

As of December 31, 2012, we had approximately 7,100 full-time employees, including 4,700 domestic and 2,400 international

employees, of which approximately 6,900 were employed in our operations departments and approximately 200 were employed in our
corporate group.

Our staffing needs vary significantly throughout the year. Therefore, we also employ part-time and/or seasonal employees,

primarily for our live music venues. As of December 31, 2012, we employed approximately 5,800 seasonal and/or part-time
employees and during peak seasonal periods, particularly in the summer months, we employed as many as 14,000 seasonal employees
in 2012. The stagehands at some of our venues and other employees are subject to collective bargaining agreements. Our union
agreements typically have a term of three years and thus regularly expire and require negotiation in the course of our business. We
believe that we enjoy good relations with our employees and other unionized labor involved in our events, and there have been no
significant work stoppages in the past three years. Upon the expiration of any of our collective bargaining agreements, however, we
may be unable to renegotiate on terms favorable to us, and our business operations at one or more of our facilities may be interrupted
as a result of labor disputes or difficulties and delays in the process of renegotiating our collective bargaining agreements. In addition,
our business operations at one or more of our facilities may also be interrupted as a result of labor disputes by outside unions
attempting to unionize a venue even though we do not have unionized labor at that venue currently. A work stoppage at one or more
of our owned and/or operated venues or at our promoted events could have a material adverse effect on our business, results of
operations and financial condition. We cannot predict the effect that a potential work stoppage will have on our results of operations.

17
Executive Officers

Set forth below are the names, ages and current positions of our executive officers and other significant employees as of

February 20, 2013.

Name

Michael Rapino...............................

Ron Bension....................................

Joe Berchtold ..................................

Mark Campana................................

Brian Capo ......................................

Arthur Fogel....................................

John Hopmans.................................

Nathan Hubbard..............................

Simon Lewis ...................................

John Reid ........................................

Alan Ridgeway ...............................

Bob Roux ........................................

Michael Rowles ..............................

Russell Wallach ..............................

Kathy Willard .................................

Mark Yovich ...................................

Age

Position

President, Chief Executive Officer and Director

President—HOB Entertainment

Chief Operating Officer

President—North America Concerts, Regions North

Chief Accounting Officer

Chairman—Global Music and President—Global Touring

Executive Vice President—Mergers and Acquisitions and Strategic Finance

President—Ticketmaster

President—Live Nation Europe—Sponsorship and Concerts

President—Live Nation Europe—Concerts

President—International and Emerging Markets

President—North America Concerts, Regions South

General Counsel and Secretary

President—North America Sponsorships

Chief Financial Officer

President—Ticketmaster International

Michael Rapino is our President and Chief Executive Officer and has served in this capacity since August 2005. He has also

served on our board of directors since December 2005. Mr. Rapino has worked for us or our predecessors since 1999.

Ron Bension is President of our HOB Entertainment division and has served in this capacity since November 2010. Previously,

Mr. Bension served as Chief Executive Officer for TicketsNow, a division of Ticketmaster, from January 2010 to November 2010.
From June 2009 to October 2009, Mr. Bension was Chief Executive Officer of ProLink and from February 2008 to June 2009, he was
Chief Executive Officer for SportNet.

Joe Berchtold is our Chief Operating Officer and has served in this capacity since April 2011. Prior to that, Mr. Berchtold was at

Technicolor, where he was most recently President of Technicolor Creative Services, after joining them in 2003.

Mark Campana is President of our North America Concerts, Regions North division and has served in this capacity since
October 2010. Prior to that, Mr. Campana served as President of our Midwest Region in North America Concerts. Mr. Campana has
worked for us or our predecessors since 1980.

Brian Capo is our Chief Accounting Officer and has served in this capacity since December 2007.

Arthur Fogel is the Chairman of our Global Music group and President of our Global Touring division and has served in this

capacity since 2005. Mr. Fogel has worked for us or our predecessors since 1999.

John Hopmans is our Executive Vice President of Mergers and Acquisitions and Strategic Finance and has served in this
capacity since April 2008. Previously, Mr. Hopmans served in several capacities at Scotia Capital including Managing Director,
Industry Head, Private Equity Sponsor Coverage and as Managing Director, Industry Head, Diversified Industries since joining them
in 1991.

Nathan Hubbard is the President of our Ticketing division and has served in this capacity since January 2008. Prior to that,

Mr. Hubbard was Chief Executive Officer of Musictoday which was acquired by us in 2006.

Simon Lewis is the President of our Europe Sponsorship and Concerts divisions and has served in this capacity since November
2011. Prior to that, Mr. Lewis was President of our International Sponsorship division and had served in that capacity since joining us
in 2003.

John Reid is the President of our Europe Concerts division and has served in that capacity since January 2012. Prior to that,

Mr. Reid was the Chief Executive Officer of Warner Music Europe and International Marketing from November 2010 to December
2011. From February 2007 to October 2010, Mr. Reid was the Vice Chairman Warner Music International and President Warner
Music Continental Europe.

Alan Ridgeway is the President of our International and Emerging Markets division and has served in this capacity since

November 2011. Prior to that, Mr. Ridgeway was Chief Executive Officer of our International divisions from September 2007 to
October 2011. From September 2005 to August 2007, Mr. Ridgeway was our Chief Financial Officer. Mr. Ridgeway has worked for
us or our predecessors since 2002.

Bob Roux is President of our North America Concerts, Regions South division and has served in this capacity since October
2010. Prior to that, Mr. Roux served as President of our Southwest Region in North America Concerts. Mr. Roux has worked for us or
our predecessors since 1990.

Michael Rowles is our General Counsel and has served in this capacity since March 2006 and as our Secretary since May 2007.

Russell Wallach is President of our North America Sponsorships division and has served in this capacity since July 2006. Prior

to that, Mr. Wallach served as Executive Vice President of Sales and Marketing for us or our predecessors since joining in 1996.

Kathy Willard is our Chief Financial Officer and has served in this capacity since September 2007. From September 2005 to

August 2007, Ms. Willard was our Chief Accounting Officer. Ms. Willard has worked for us or our predecessors since 1998.

Mark Yovich is the President of Ticketmaster’s International division and has served in this capacity since November 2011.
Prior to that, Mr. Yovich served as Executive Vice President and General Manager of our International eCommerce division from
January 2010 to October 2011. From 2006 to January 2010, Mr. Yovich served as our Vice President New Media—International
Music and worked for us or our predecessors since 2000.

Available Information

We are required to file annual, quarterly and current reports, proxy statements and other information with the SEC. You may
read and copy any materials we have filed with the SEC at the SEC’s Public Reference Room at 100 F Street, NE, Washington, DC
20549. You may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. Our
filings with the SEC are also available to the public through the SEC’s website at www.sec.gov.

You can find more information about us at our internet website located at www.livenation.com. Our Annual Report on Form 10-
K, our Quarterly Reports on Form 10-Q, our Current Reports on Form 8-K and any amendments to those reports are available free of
charge on our internet website as soon as reasonably practicable after we electronically file such material with the SEC.

ITEM 1A. RISK

FACTORS

You should carefully consider each of the following risks and all of the other information set forth in this Annual Report. The
following risks relate principally to our business, our leverage, our convertible notes, our common stock, our separation from Clear
Channel, Ticketmaster’s spin-off from IAC, our merger with Ticketmaster and our general business operations. These risks and
uncertainties are not the only ones facing our company. Additional risks and uncertainties not presently known to us or that we
currently believe to be immaterial may also adversely affect our business. If any of the risks and uncertainties develop into actual
events, this could have a material adverse effect on our business, financial condition or results of operations. In that case, the trading
price of our common stock could decline.

Risks Relating to Our Business

Our business is highly sensitive to public tastes and is dependent on our ability to secure popular artists and other live music
events, and we and our ticketing clients may be unable to anticipate or respond to changes in consumer preferences, which may
result in decreased demand for our services.

Our business is highly sensitive to rapidly changing public tastes and is dependent on the availability of popular artists and
events. Our live entertainment business depends in part on our ability to anticipate the tastes of consumers and to offer events that
appeal to them. Since we rely on unrelated parties to create and perform at live music events, any unwillingness to tour or lack of
availability of popular artists could limit our ability to generate revenue. In particular, there are a limited number of artists that can
headline a major North American or global tour or who can sell out larger venues, including many of our amphitheaters. If those
artists do not choose to tour, or if we are unable to secure the rights to their future tours, then our business would be adversely
affected. Our ticketing business relies on third parties to create and perform live entertainment, sporting and leisure events and to price
tickets to such events. Accordingly, our ticketing business’ success depends, in part, upon the ability of these third parties to correctly
anticipate public demand for particular events, as well as the availability of popular artists, entertainers and teams. Our artist services
business could be adversely affected if the artists it represents do not tour or perform as frequently as anticipated, or if such tours or
performances are not as widely attended by fans as anticipated due to changing tastes, general economic conditions or otherwise.

In addition, our live entertainment business typically books our live music tours one to four months in advance of the beginning

of the tour and often agrees to pay an artist a fixed guaranteed amount prior to our receiving any revenue. Therefore, if the public is
not receptive to the tour, or we or an artist cancel the tour, we may incur a loss for the tour depending on the amount of the fixed
guarantee or incurred costs relative to any revenue earned, as well as revenue we could have earned at booked venues. We have
cancellation insurance policies in place to cover a portion of our losses if an artist cancels a tour but it may not be sufficient and is
subject to deductibles. Furthermore, consumer preferences change from time to time, and our failure to anticipate, identify or react to
these changes could result in reduced demand for our services, which would adversely affect our business, financial condition and
results of operations.

Our business depends on relationships between key promoters, executives, agents, managers, artists and clients and any adverse
changes in these relationships could adversely affect our business, financial condition and results of operations.

The live music business is uniquely dependent upon personal relationships, as promoters and executives within live music
companies such as ours leverage their existing network of relationships with artists, agents and managers in order to secure the rights
to the live music tours and events which are critical to our success. Due to the importance of those industry contacts to our business,
the loss of any of our promoters, officers or other key personnel could adversely affect our business. Similarly, the artist services
business is dependent upon the highly personalized relationship between a manager and an artist, and the loss of a manager may also
result in a loss in the artist represented by the manager, which could adversely affect our business. Although we have entered into
long-term agreements with many of those individuals described above to protect our interests in those relationships, we can give no
assurance that all or any of these key employees or managers will remain with us or will retain their associations with key business
contacts, including musical artists.

The success of our ticketing business depends, in significant part, on our ability to maintain and renew relationships with
existing clients and to establish new client relationships. We anticipate that, for the foreseeable future, the substantial majority of our
Ticketing segment revenue will be derived from both online and direct sales of tickets. We also expect that revenue from primary
ticketing services, which consist primarily of per ticket convenience charges and per order “order processing” fees, will continue to
comprise the substantial majority of our Ticketing segment revenue. We cannot provide assurances that we will be able to maintain
existing client contracts, or enter into or maintain new client contracts, on acceptable terms, if at all, and the failure to do so could
have a material adverse effect on our business, financial condition and results of operations.

Another important component of our success is our ability to maintain existing and to build new relationships with third-party

distribution channels, advertisers, sponsors and service providers. Any adverse change in these relationships, including the inability of
these parties to fulfill their obligations to our businesses for any reason, could adversely affect our business, financial condition and
results of operations.

20
We face intense competition in the live music, ticketing and artist services industries, and we may not be able to maintain or
increase our current revenue, which could adversely affect our business, financial condition and results of operations.

Our businesses are in highly competitive industries, and we may not be able to maintain or increase our current revenue due to

such competition. The live music industry competes with other forms of entertainment for consumers’ discretionary spending and
within this industry we compete with other venues to book artists, and, in the markets in which we promote music concerts, we face
competition from other promoters and venue operators. Our competitors compete with us for key employees who have relationships
with popular music artists and that have a history of being able to book such artists for concerts and tours. These competitors may
engage in more extensive development efforts, undertake more far-reaching marketing campaigns, adopt more aggressive pricing
policies and make more attractive offers to existing and potential artists. Our competitors may develop services, advertising options or
music venues that are equal or superior to those we provide or that achieve greater market acceptance and brand recognition than we
achieve. It is possible that new competitors may emerge and rapidly acquire significant market share.

Our ticketing business faces significant competition from other national, regional and local primary ticketing service providers

to secure new and retain existing clients on a continuous basis. Additionally, we face significant and increasing challenges from
companies that sell self-ticketing systems and from clients who choose to self-ticket, through the integration of such systems into their
existing operations or the acquisition of primary ticket services providers or by increasing sales through venue box offices and season,
subscription or group sales. We also face competition in the resale of tickets from online auction websites and resale marketplaces and
from other ticket resellers with online distribution capabilities. The advent of new technology, particularly as it relates to online
ticketing, has amplified this competition. The intense competition that we face in the ticketing industry could cause the volume of our
ticketing services business to decline. In 2010, we divested Ticketmaster’s Paciolan ticketing business which further increased the
competition that we face. As a result of our merger with Ticketmaster we may face direct competition, in the live music industry, with
our prospective or current primary ticketing clients, who primarily include live event content providers. This direct competition with
our prospective or current primary ticketing clients could result in a decline in the number of ticketing clients we have and a decline in
the volume of our ticketing business, which could adversely affect our business, financial condition and results of operations.

In the secondary ticket sales market, we have restrictions on our business that are not faced by our competitors, which

restrictions include those that are self-imposed, imposed as a result of agreements entered into with the FTC and the Attorneys
General of several individual states, and statutory. These restrictions primarily relate to our TicketsNow business, and include:
restrictions on linking from our page on the www.ticketmaster.com website that informs consumers that no tickets were found in
response to their ticket request to our TicketsNow resale website without first obtaining approval from the State of New Jersey as to
any changes to our current Ticketmaster/TicketsNow linking practices; a restriction on using or allowing our affiliates to use domain
names that, among other things, contain the unique names of venues, sports teams or performers, or contain names that are
substantially similar to or are misspelled versions of same; a requirement to clearly and conspicuously disclose on the TicketsNow
website (or any other resale website owned by us or on any primary ticketing website where a link or redirect to such a resale website
is posted) that it is a resale website and ticket prices often exceed the ticket’s original price; and a requirement to make certain clear
and conspicuous disclosures and in certain instances to create separate listings when a ticket being offered for resale is not “in-hand”
as well as a requirement to monitor and enforce the compliance of third parties offering tickets on our websites with such disclosure
requirements. Our competitors in the secondary ticket sales market are not, to our knowledge, bound by similar restrictions. As a
result, our ability to effectively compete in the secondary ticket sales market, through our TicketsNow business or otherwise, may be
adversely affected, which could in turn adversely affect our business, financial condition and results of operations.

The artist services industry is also a highly competitive industry. There are numerous other artist management companies and

individual managers in the United States alone. We compete with these companies and individuals to discover new and emerging
artists and to represent established artists. In addition, certain of our arrangements with clients of our artist services business are
terminable at will by either party, leading to competition to retain those artists as clients. Competition is intense and may contribute to
a decline in the volume of our artist services business, which could adversely affect our business, financial condition and results of
operations.

Other variables that could adversely affect our financial performance by, among other things, leading to decreases in overall

revenue, the number of sponsors, event attendance, ticket prices and fees or profit margins include:

•

an increased level of competition for advertising dollars, which may lead to lower sponsorships as we attempt to retain
advertisers or which may cause us to lose advertisers to our competitors offering better programs that we are unable or unwilling
to match;
unfavorable fluctuations in operating costs, including increased guarantees to artists, which we may be unwilling or unable to
pass through to our customers via ticket prices;
competitors’ offerings that may include more favorable terms than we do in order to obtain agreements for new venues or
ticketing arrangements or to obtain events for the venues they operate;

21
•

•

technological changes and innovations that we are unable to adopt or are late in adopting that offer more attractive entertainment
alternatives than we or other live entertainment providers currently offer, which may lead to a reduction in attendance at live
events, a loss of ticket sales or to lower ticket fees;
other entertainment options available to our audiences that we do not offer;
general economic conditions which could cause our consumers to reduce discretionary spending;
unfavorable changes in labor conditions which may require us to spend more to retain and attract key employees; and
unfavorable shifts in population and other demographics which may cause us to lose audiences as people migrate to markets
where we have a smaller presence, or which may cause sponsors to be unwilling to pay for sponsorship and advertising
opportunities if the general population shifts into a less desirable age or geographical demographic from an advertising
perspective.

We have incurred net losses and may experience future net losses.

Our operating results from continuing operations have been adversely affected by, among other things, variability in ticket sales,

event profitability, overhead costs and high amortization of intangibles related to prior acquisitions. Live Nation incurred net losses
from continuing operations of approximately $161.9 million, $70.4 million and $203.8 million in 2012, 2011 and 2010, respectively.
We may face reduced demand for our live music events, our ticketing software and services and other factors that could adversely
affect our business, financial condition and results of operations in the future. We cannot predict whether we will achieve or maintain
profitability in future periods.

Our operations are seasonal and our results of operations vary from quarter to quarter and year over year, so our financial
performance in certain financial quarters or years may not be indicative of, or comparable to, our financial performance in
subsequent financial quarters or years.

We believe our financial results and cash needs will vary greatly from quarter to quarter and year to year depending on, among
other things, the timing of tours, tour cancellations, event ticket on-sales, capital expenditures, seasonal and other fluctuations in our
operating results, the timing of guaranteed payments and receipt of ticket sales and fees, financing activities, acquisitions and
investments and receivables management. Because our results may vary significantly from quarter to quarter and year to year, our
financial results for one quarter or year cannot necessarily be compared to another quarter or year and may not be indicative of our
future financial performance in subsequent quarters or years. Typically, we experience our lowest financial performance in the first
and fourth quarters of the calendar year as our outdoor venues are primarily used, and our festivals primarily occur, during May
through September. In addition, the timing of tours of top grossing acts can impact comparability of quarterly results year over year
and potentially annual results. The timing of event on-sales by our ticketing clients can also impact this comparability.

The following table sets forth our operating income (loss) for the last eight fiscal quarters:

Fiscal Quarter Ended

Operating
income (loss)
(in thousands)

March 31, 2011........................................................................................ $
June 30, 2011........................................................................................... $
September 30, 2011 ................................................................................. $
December 31, 2011.................................................................................. $
March 31, 2012........................................................................................ $
June 30, 2012........................................................................................... $
September 30, 2012 ................................................................................. $
December 31, 2012.................................................................................. $

(72,161)
52,373
104,809
(66,684)
(42,803)
42,968
104,515
(126,319)

Our success depends, in significant part, on entertainment, sporting and leisure events and factors adversely affecting such
events could have a material adverse effect on our business, financial condition and results of operations.

A decline in attendance at or reduction in the number of live entertainment, sporting and leisure events may have an adverse

effect on our revenue and operating income. In addition, during past economic slowdowns and recessions, many consumers reduced
their discretionary spending and advertisers reduced their advertising expenditures. The impact of economic slowdowns on our
business is difficult to predict, but they may result in reductions in ticket sales, sponsorship opportunities and our ability to generate
revenue. The risks associated with our businesses may become more acute in periods of a slowing economy or recession, which may
be accompanied by a decrease in attendance at live entertainment, sporting and leisure events. Many of the factors affecting the
number and availability of live entertainment, sporting and leisure events are beyond our control. For instance, certain sports leagues
have recently had labor disputes leading to threatened or actual player lockouts. Any such lockouts that result in shortened or canceled

seasons would adversely impact our business to the extent that we provide ticketing services to the affected teams both due to the loss
of games and ticketing opportunities as well as the possibility of decreased attendance following such a lockout due to adverse fan
reaction.

Our business depends on discretionary consumer and corporate spending. Many factors related to corporate spending and

discretionary consumer spending, including economic conditions affecting disposable consumer income such as employment, fuel
prices, interest and tax rates and inflation can significantly impact our operating results. Business conditions, as well as various
industry conditions, including corporate marketing and promotional spending and interest levels, can also significantly impact our
operating results. These factors can affect attendance at our events, premium seat sales, sponsorship, advertising and hospitality
spending, concession and merchandise sales, as well as the financial results of sponsors of our venues, events and the industry.
Negative factors such as challenging economic conditions, public concerns over terrorism and security incidents, particularly when
combined, can impact corporate and consumer spending, and one negative factor can impact our results more than another. There can
be no assurance that consumer and corporate spending will not be adversely impacted by current economic conditions, or by any
further or future deterioration in economic conditions, thereby possibly impacting our operating results and growth.

We operate in international markets in which we have limited experience and which may expose us to risks not found in doing
business in the United States.

We provide services in various jurisdictions abroad through a number of brands and businesses that we own and operate, as well

as through joint ventures, and we expect to continue to expand our international presence. We face, and expect to continue to face,
additional risks in the case of our existing and future international operations, including:

•

political instability, adverse changes in diplomatic relations and unfavorable economic conditions in the markets in which
we currently have international operations or into which we may expand;

•

• more restrictive or otherwise unfavorable government regulation of the live entertainment and ticketing industries, which
could result in increased compliance costs and/or otherwise restrict the manner in which we provide services and the
amount of related fees charged for such services;
limitations on the enforcement of intellectual property rights;
limitations on the ability of foreign subsidiaries to repatriate profits or otherwise remit earnings;
adverse tax consequences;
expropriations of property and risks of renegotiation or modification of existing agreements with governmental
authorities;
diminished ability to legally enforce our contractual rights in foreign countries;
limitations on technology infrastructure, which could limit our ability to migrate international operations to a common
ticketing system;
lower levels of internet usage, credit card usage and consumer spending in comparison to those in the United States; and
difficulties in managing operations and adapting to consumer desires due to distance, language and cultural differences,
including issues associated with (i) business practices and customs that are common in certain foreign countries but might
be prohibited by United States law and our internal policies and procedures, and (ii) management and operational systems
and infrastructures, including internal financial control and reporting systems and functions, staffing and managing of
foreign operations, which we might not be able to do effectively, or if so, on a cost-efficient basis.

•

Our ability to expand our international operations into new jurisdictions, or further into existing jurisdictions will depend, in

significant part, on our ability to identify potential acquisition candidates, joint venture or other partners, and enter into arrangements
with these parties on favorable terms, as well as our ability to make continued investments to maintain and grow existing international
operations. If the revenue generated by international operations are insufficient to offset expenses incurred in connection with the
maintenance and growth of these operations, our business, financial condition and results of operations could be materially and
adversely affected. In addition, in an effort to make international operations in one or more given jurisdictions profitable over the long
term, significant additional investments that are not profitable over the short term could be required over a prolonged period.

Exchange rates may cause fluctuations in our results of operations that are not related to our operations.

Because we own assets overseas and derive revenue from our international operations, we may incur currency translation losses

or gains due to changes in the values of foreign currencies relative to the United States Dollar. We cannot predict the effect of
exchange rate fluctuations upon future operating results. For the year ended December 31, 2012, our international operations
accounted for approximately 36% of our revenue. Although we cannot predict the future relationship between the United States Dollar
and the currencies used by our international businesses, principally the British Pound, Euro and Canadian Dollar, we experienced
foreign exchange rate net losses of $2.5 million, $1.3 million and $14.6 million in 2012, 2011 and 2010, respectively, which had a
negative effect on our operating income. See Item 7A. Quantitative and Qualitative Disclosures about Market Risk.

23
We may enter into future acquisitions and take certain actions in connection with such transactions that could affect our results
of operations and the price of our common stock.

As part of our growth strategy, we expect to review acquisition prospects that would offer growth opportunities. In the event of

future acquisitions, we could, among other things:

•

use a significant portion of our available cash;
issue equity securities, which would dilute current stockholders’ percentage ownership;
incur substantial debt;
incur or assume contingent liabilities, known or unknown;
incur amortization expenses related to intangibles; and
incur large accounting write-offs.

Such actions by us could adversely affect our results from operations and the price of our common stock.

We may be unsuccessful in our future acquisition endeavors, if any, which may have an adverse effect on our business; in
addition, some of the businesses we acquire may incur significant losses from operations or experience impairment of carrying
value. Our compliance with antitrust, competition and other regulations may limit our operations and future acquisitions.

Our future growth rate depends in part on our selective acquisition of additional businesses. A significant portion of our growth

has been attributable to acquisitions. We may be unable to identify other suitable targets for further acquisition or make further
acquisitions at favorable prices. If we identify a suitable acquisition candidate, our ability to successfully complete the acquisition
would depend on a variety of factors, and may include our ability to obtain financing on acceptable terms and requisite government
approvals. In addition, the credit agreement for our senior secured credit facility restricts our ability to make certain acquisitions.
Acquisitions involve risks, including those associated with:

integrating the operations, financial reporting, technologies and personnel of acquired companies;

•
• managing geographically dispersed operations;
•

the diversion of management’s attention from other business concerns;
the inherent risks in entering markets or lines of business in which we have either limited or no direct experience; and
the potential loss of key employees, customers and strategic partners of acquired companies.

•

We may not successfully integrate any businesses or technologies we may acquire in the future and may not achieve anticipated

revenue and cost benefits. Acquisitions may be expensive, time consuming and may strain our resources. Acquisitions may not be
accretive to our earnings and may negatively impact our results of operations as a result of, among other things, expenses to pursue the
acquisition and the incurrence of debt. In addition, future acquisitions that we may pursue could result in dilutive issuances of equity
securities. Also, the value of goodwill and other intangible assets acquired could be impacted by one or more unfavorable events or
trends, which could result in impairment charges. The occurrence of any of these events could adversely affect our business, financial
condition and results of operations. In addition, we may choose to substantially reduce or discontinue the operations of any of our
acquired businesses if we are unsuccessful in meeting these challenges. Any such shut-down could expose us to expenses associated
with exiting from existing contracts and terminating employees, and could expose us to certain unknown liabilities that arise following
the shut-down.

We are also subject to laws and regulations, including those relating to antitrust, that could significantly affect our ability to

expand our business through acquisitions. For example, the FTC and the Antitrust Division of the DOJ with respect to our domestic
acquisitions, and the European Commission (the antitrust regulator of the European Union) and the United Kingdom Competition
Commission with respect to our European acquisitions, have the authority to challenge our acquisitions on antitrust grounds before or
after the acquisitions are completed. State agencies may also have standing to challenge these acquisitions under state or federal
antitrust law. Comparable authorities in other jurisdictions also have the ability to challenge our foreign acquisitions. Our failure to
comply with all applicable laws and regulations could result in, among other things, regulatory actions or legal proceedings against us,
the imposition of fines, penalties or judgments against us or significant limitations on our activities. In addition, the regulatory
environment in which we operate is subject to change. New or revised requirements imposed by governmental regulatory authorities
could have adverse effects on us, including increased costs of compliance. We also may be adversely affected by changes in the
interpretation or enforcement of existing laws and regulations by these governmental authorities.

24
Our businesses may not be able to adapt quickly enough to changing customer requirements and industry standards.
The ticketing industry is characterized by evolving industry standards, frequent new service and product introductions,
enhancements and changing customer demands. We may not be able to adapt quickly enough and/or in a cost-effective manner to
changes in industry standards and customer requirements and preferences, and our failure to do so could adversely affect our business,
financial condition and results of operations. In addition, the continued widespread adoption of new internet or telecommunications
technologies and devices or other technological changes could require us to modify or adapt our respective services or infrastructures.
Our failure to modify or adapt our services or infrastructures in response to these trends could render our existing websites, services
and proprietary technologies obsolete, which could adversely affect our business, financial condition and results of operations.

In addition, we are currently in the process of re-platforming our Ticketmaster ticketing system and migrating our international

brands and businesses to a common ticketing platform in an attempt to provide consistent and state-of-the-art services across our
businesses and to reduce the cost and expense of maintaining multiple systems, which we may not be able to complete in a timely or
cost-effective manner. Delays or difficulties in making these changes to our ticketing systems, as well as any new or enhanced
systems, may limit our ability to achieve the desired results in a timely manner. Also, we may be unable to devote financial resources
to new technologies and systems in the future, which could adversely affect our business, financial condition and results of operations.

There is the risk of personal injuries and accidents in connection with our live music events, which could subject us to personal
injury or other claims and increase our expenses, as well as reduce attendance at our live music events, causing a decrease in
our revenue.

There are inherent risks involved with producing live music events. As a result, personal injuries and accidents have, and may,

occur from time to time, which could subject us to claims and liabilities for personal injuries. Incidents in connection with our live
music events at any of our venues or festival sites that we own or rent could also result in claims, reducing operating income or
reducing attendance at our events, which could cause a decrease in our revenue. We have been subject to wrongful death claims and
are currently subject to other litigation. While we maintain insurance policies that provide coverage within limits that are sufficient, in
management’s judgment, to protect us from material financial loss for personal injuries sustained by persons at our venues or events or
accidents in the ordinary course of business, there can be no assurance that such insurance will be adequate at all times and in all
circumstances.

The success of our ticketing and ecommerce operations depends, in part, on the integrity of our systems and infrastructures and
the protection of the data contained in such systems. System interruption, the lack of integration and redundancy in these
systems and infrastructures and breaches or lapses in the security protecting these systems may have an adverse impact on our
business, financial condition and results of operations.

The success of our ticketing and ecommerce operations depends, in part, on our ability to maintain the integrity of our systems

and infrastructures, including websites, information technology systems, call centers and distribution and fulfillment facilities. System
interruption and the lack of integration and redundancy in our information systems and infrastructures of our ticketing operations may
adversely affect our ability to operate websites, process and fulfill transactions, respond to customer inquiries and generally maintain
cost-efficient operations. We may experience occasional system interruptions that make some or all systems or data unavailable or
prevent our businesses from efficiently providing services or fulfilling orders. We lack documentation regarding certain components
of our key ticketing software and systems operations and rely on certain key technology personnel to maintain such software and
systems. The loss of some or all of such personnel could require us to expend additional resources to continue to maintain such
software and systems and could subject us to frequent systems interruptions. We also rely on affiliate and third-party computer
systems, broadband and other communications systems and service providers in connection with the provision of services, as well as
to facilitate, process and fulfill transactions. Any interruptions, outages or delays in their systems and infrastructures, their businesses
and/or third parties, or deterioration in the performance of these systems and infrastructures, could impair our ability to provide
services, fulfill orders and/or process transactions. Fire, flood, power loss, telecommunications failure, hurricanes, tornadoes,
earthquakes, acts of war or terrorism, other acts of God and similar events or disruptions may damage or interrupt computer,
broadband or other communications systems and infrastructures at any time. Any of these events could cause system interruption,
delays and loss of critical data, and could prevent us from providing services, fulfilling orders and/or processing transactions. While
we have backup systems for certain aspects of our operations, disaster recovery planning by its nature cannot be sufficient for all
eventualities. In addition, we may not have adequate insurance coverage to compensate for losses from a major interruption. If any of
these adverse events were to occur, it could adversely affect our business, financial condition and results of operations.

25
In addition, any penetration of network security or other misappropriation or misuse of personal consumer information and data

could cause interruptions in our operations and subject us to increased costs, litigation and other liabilities. Network security issues
could lead to claims against us for other misuse of personal information, such as for unauthorized purposes or identity theft, which
could result in litigation and financial liabilities, as well as administrative action from governmental authorities. In addition, security
breaches or the inability to protect our data could lead to increased incidents of ticketing fraud and counterfeit tickets. Security
breaches could also significantly damage our reputation with consumers, ticketing clients and other third parties. It is possible that
advances in computer capabilities, new discoveries, undetected fraud, inadvertent violations of company policies or procedures or
other developments could result in a compromise of information or a breach of the technology and security processes that are used to
protect consumer transaction data. As a result, current security measures may not prevent any or all security breaches. We may be
required to expend significant capital and other resources to protect against and remedy any potential or existing security breaches and
their consequences. We also face risks associated with security breaches affecting third parties with which we are affiliated or with
which we otherwise conduct business. Consumers are generally concerned with security and privacy of the internet, and any
publicized security problems affecting our businesses and/or those of third parties may discourage consumers from doing business
with us, which could have an adverse effect on our business, financial condition and results of operations.

The processing, storage, use and disclosure of personal data could give rise to liabilities as a result of governmental regulation,
conflicting legal requirements or differing views of personal privacy rights.

In the processing of consumer transactions, we receive, transmit and store a large volume of personally identifiable information

and other user data. The sharing, use, disclosure and protection of this information are governed by our respective privacy and data
security policies. Moreover, there are federal, state and international laws regarding privacy and the storage, sharing, use, disclosure
and protection of personally identifiable information and user data. Specifically, personally identifiable information is increasingly
subject to legislation and regulations in numerous jurisdictions around the world, the intent of which is to protect the privacy of
personal information that is collected, processed and transmitted in or from the governing jurisdiction. We could be adversely affected
if legislation or regulations are expanded to require changes in business practices or privacy policies, or if governing jurisdictions
interpret or implement their legislation or regulations in ways that negatively affect our business, financial condition and results of
operations.

We may also become exposed to potential liabilities as a result of differing views on the privacy of the consumer and other user

data collected by us. Our failure or the failure of the various third-party vendors and service providers with which we do business to
comply with applicable privacy policies or federal, state or similar international laws and regulations or any compromise of security
that results in the unauthorized release of personally identifiable information or other user data could damage our reputation,
discourage potential users from trying our products and services and/or result in fines and/or proceedings by governmental agencies
and/or consumers, one or all of which could adversely affect our business, financial condition and results of operations.

Costs associated with, and our ability to obtain, adequate insurance could adversely affect our profitability and financial
condition.

Heightened concerns and challenges regarding property, casualty, liability, business interruption and other insurance coverage

have resulted from terrorist and related security incidents along with varying weather-related conditions and incidents. As a result, we
may experience increased difficulty obtaining high policy limits of coverage at reasonable rates, including coverage for acts of
terrorism and weather-related property damage. We have a material investment in property and equipment at each of our venues,
which are generally located near major cities and which hold events typically attended by a large number of fans. We also have a
significant investment in technology including our ticketing systems. At December 31, 2012, we had property and equipment with a
net book value of approximately $721.8 million.

These operational, geographical and situational factors, among others, may result in significant increases in insurance premium
costs and difficulties obtaining sufficiently high policy limits with deductibles that we believe to be reasonable. We cannot assure you
that future increases in insurance costs and difficulties obtaining high policy limits will not adversely impact our profitability, thereby
possibly impacting our operating results and growth.

In addition, we enter into various agreements with artists from time to time, including long-term artist rights arrangements. The
profitability of those arrangements depends upon those artists’ willingness and ability to continue performing, and we may not be able
to obtain sufficient insurance coverage at reasonable rates to adequately protect us against the death, disability or other failure of such
artists to continue engaging in revenue-generating activities under those agreements.

26
We cannot guarantee that our insurance policy coverage limits, including insurance coverage for property, casualty, liability,
artists and business interruption losses and acts of terrorism, would be adequate under the circumstances should one or multiple events
occur at or near any of our venues, or that our insurers would have adequate financial resources to sufficiently or fully pay our related
claims or damages. We cannot guarantee that adequate coverage limits will be available, offered at reasonable rates, or offered by
insurers with sufficient financial soundness. The occurrence of such an incident or incidents affecting any one or more of our venues
could have a material adverse effect on our financial position and future results of operations if asset damage and/or company liability
were to exceed insurance coverage limits or if an insurer were unable to sufficiently or fully pay our related claims or damages.

Costs associated with capital improvements could adversely affect our profitability and liquidity.

Growth or maintenance of our existing revenue depends in part on consistent investment in our venues and our technology.
Therefore, we expect to continue to make substantial capital improvements to meet long-term increasing demand, value and revenue.
We frequently have a number of significant capital projects underway. Numerous factors, many of which are beyond our control, may
influence the ultimate costs and timing of various capital improvements, including:

•

availability of financing on favorable terms;
advances in technology and related changes in customer expectations;
unforeseen changes in design;
increases in the cost of materials, equipment and labor;
fluctuations in foreign exchange rates;
litigation, accidents or natural disasters;
national or regional economic changes;
additional land acquisition costs;
environmental or hazardous conditions; and
undetected soil or land conditions.

The amount of capital expenditures can vary significantly from year to year. In addition, actual costs could vary materially from
our estimates if the factors listed above and our assumptions about the quality of materials, equipment or workmanship required or the
cost of financing such expenditures were to change. Construction is also subject to governmental permitting processes which, if
changed, could materially affect the ultimate cost. See Item 7. Management’s Discussion and Analysis of Financial Condition and
Results of Operations—Uses of Cash.

We may fail to adequately protect our intellectual property rights or may be accused of infringing upon intellectual property
rights of third parties.

We may fail to adequately protect our intellectual property rights or may be accused of infringing upon intellectual property
rights of third parties. We regard our intellectual property rights, including patents, service marks, trademarks and domain names,
copyrights, trade secrets and similar intellectual property (as applicable) as critical to our success. We also rely heavily upon software
codes, informational databases and other components that make up our products and services.

We rely on a combination of laws and contractual restrictions with employees, customers, suppliers, affiliates and others to
establish and protect these proprietary rights. Despite these precautions, it may be possible for a third party to copy or otherwise obtain
and use trade secrets or copyrighted intellectual property without authorization which, if discovered, might require legal action to
correct. In addition, third parties may independently and lawfully develop substantially similar intellectual properties.

We have generally registered and continue to apply to register, or secure by contract when appropriate, our trademarks and

service marks as they are developed and used, and reserve and register domain names as we deem appropriate. We consider the
protection of our trademarks to be important for purposes of brand maintenance and reputation. While we vigorously protect our
trademarks, service marks and domain names, effective trademark protection may not be available or may not be sought in every
country in which we operate, and contractual disputes may affect the use of marks governed by private contract. Similarly, not every
variation of a domain name may be available or be registered, even if available. Our failure to protect our intellectual property rights
in a meaningful manner or challenges to related contractual rights could result in erosion of brand names and limit our ability to
control marketing on or through the internet using our various domain names or otherwise, which could adversely affect our business,
financial condition and results of operations.

27
Some of our businesses have been granted patents and/or have patent applications pending with the United States Patent and
Trademark Office and/or various foreign patent authorities for various proprietary technologies and other inventions. We consider
applying for patents or for other appropriate statutory protection when we develop valuable new or improved proprietary technologies
or identify inventions, and will continue to consider the appropriateness of filing for patents to protect future proprietary technologies
and inventions as circumstances may warrant. The status of any patent involves complex legal and factual questions, and the breadth
of claims allowed is uncertain. Accordingly, any patent application filed may not result in a patent being issued or existing or future
patents may not be adjudicated valid by a court or be afforded adequate protection against competitors with similar technology. In
addition, third parties may create new products or methods that achieve similar results without infringing upon patents that we own.
Likewise, the issuance of a patent to us does not mean that its processes or inventions will not be found to infringe upon patents or
other rights previously issued to third parties.

From time to time, we are subject to legal proceedings and claims in the ordinary course of business, including claims of alleged
infringement of the trademarks, copyrights, patents and other intellectual property rights of third parties. In addition, litigation may be
necessary in the future to enforce our intellectual property rights, protect trade secrets or determine the validity and scope of
proprietary rights claimed by others. Any litigation of this nature, regardless of outcome or merit, could result in substantial costs and
diversion of management and technical resources, any of which could adversely affect our business, financial condition and results of
operations. Patent litigation tends to be particularly protracted and expensive.

We are subject to extensive governmental regulation, and our failure to comply with these regulations could adversely affect our
business, financial condition and results of operations.

Our operations are subject to federal, state and local statutes, rules, regulations policies and procedures, both domestically and

internationally, which are subject to change at any time, governing matters such as:

•

•
• working conditions, labor, minimum wage and hour, citizenship and employment laws;
•

•
• marketing activities via the telephone and online; and
•

primary ticketing and ticket resale services.

Our failure to comply with these laws and regulations could result in fines and/or proceedings against us by governmental
agencies and/or consumers, which if material, could adversely affect our business, financial condition and results of operations. While
we attempt to conduct our business and operations in a manner that we believe to be in compliance with such laws and regulations,
there can be no assurance that a law or regulation will not be interpreted or enforced in a manner contrary to our current understanding
of the law or regulation. In addition, the promulgation of new laws, rules and regulations could restrict or unfavorably impact our
business, which could decrease demand for services, reduce revenue, increase costs and/or subject us to additional liabilities. For
example, some legislatures have proposed laws in the past that would impose potential liability on us and other promoters and
producers of live music events for entertainment taxes and for incidents that occur at our events, particularly relating to drugs and
alcohol. Additionally, new legislation could be passed that may negatively impact our business, such as provisions that have recently
been proposed in various jurisdictions that would restrict ticketing methods, mandate ticket inventory disclosure and attack current
policies governing season tickets for sports teams.

From time to time, federal, state and local authorities and/or consumers commence investigations, inquiries or litigation with

respect to our compliance with applicable consumer protection, advertising, unfair business practice, antitrust (and similar or related
laws) and other laws. Our businesses have historically cooperated with authorities in connection with these investigations and have
satisfactorily resolved each such material investigation, inquiry or litigation. We and our TicketsNow business are currently subject to
agreements with the States of New Jersey, Maryland and Illinois and the FTC which govern, and in certain cases place limitations on,
our ticketing resale practices. Our competitors in the secondary ticket sales market are not, to our knowledge, bound by such

28
limitations and as a result, we may be at a competitive disadvantage. Other states and Canadian provinces have commenced
investigations or inquiries regarding the relationship between us and TicketsNow and other aspects of our ticketing business. We have
incurred significant legal expenses in connection with the defense of governmental investigations and litigation in the past and may be
required to incur additional expenses in the future regarding such investigations and litigation. In the case of antitrust (and similar or
related) matters, any adverse outcome could limit or prevent us from engaging in the ticketing business generally (or in a particular
market thereof) or subject us to potential damage assessments, all of which could have a material adverse effect on our business,
financial condition and results of operations.

Unfavorable outcomes in legal proceedings may adversely affect our business and operating results.

Our results may be affected by the outcome of pending and future litigation. Unfavorable rulings in our legal proceedings,

including those described in Note 7—Commitments and Contingent Liabilities to our consolidated financial statements, may have a
negative impact on us that may be greater or smaller depending on the nature of the rulings. In addition, we are currently, and from
time to time in the future may be, subject to various other claims, investigations, legal and administrative cases and proceedings
(whether civil or criminal) or lawsuits by governmental agencies or private parties, as further described in the immediately preceding
risk factor. If the results of these investigations, proceedings or suits are unfavorable to us or if we are unable to successfully defend
against third-party lawsuits, we may be required to pay monetary damages or may be subject to fines, penalties, injunctions or other
censure that could have a material adverse effect on our business, financial condition and operating results. Even if we adequately
address the issues raised by an investigation or proceeding or successfully defend a third-party lawsuit or counterclaim, we may have
to devote significant financial and management resources to address these issues, which could harm our business, financial condition
and operating results.

We depend upon unionized labor for the provision of some of our services and any work stoppages or labor disturbances could
disrupt our business.

The stagehands at some of our venues and other employees are subject to collective bargaining agreements. Our union
agreements typically have a term of three years and thus regularly expire and require negotiation in the ordinary course of our
business. Upon the expiration of any of our collective bargaining agreements, however, we may be unable to negotiate new collective
bargaining agreements on terms favorable to us, and our business operations may be interrupted as a result of labor disputes or
difficulties and delays in the process of renegotiating our collective bargaining agreements. In addition, our business operations at one
or more of our facilities may also be interrupted as a result of labor disputes by outside unions attempting to unionize a venue even
though we do not have unionized labor at that venue currently. A work stoppage at one or more of our owned and/or operated venues
or at our promoted events could have a material adverse effect on our business, results of operations and financial condition. We
cannot predict the effect that a potential work stoppage would have on our business.

We are dependent upon our ability to lease, acquire and develop live music venues, and if we are unable to do so on acceptable
terms, or at all, our results of operations could be adversely affected.

Our Concerts and Sponsorship & Advertising segments require access to venues to generate revenue from live music events. For

these events, we use venues that we own, but we also operate a number of our live music venues under various agreements which
include leases with third parties, ownership through an equity interest or booking agreements, which are agreements where we
contract to book the events at a venue for a specific period of time. Our long-term success in the live music business will depend in
part on the availability of venues, our ability to lease these venues and our ability to enter into booking agreements upon their
expiration. As many of these agreements are with third parties over whom we have little or no control, we may be unable to renew
these agreements or enter into new agreements on acceptable terms or at all, and may be unable to obtain favorable agreements with
venues. Our ability to renew these agreements or obtain new agreements on favorable terms depends on a number of other factors,
many of which are also beyond our control, such as national and local business conditions and competition from other promoters. If
the cost of renewing these agreements is too high or the terms of any new agreement with a new venue are unacceptable or
incompatible with our existing operations, we may decide to forego these opportunities. There can be no assurance that we will be
able to renew these agreements on acceptable terms or at all, or that we will be able to obtain attractive agreements with substitute
venues, which could have a material adverse effect on our results of operations.

We may continue to expand our operations through the development of live music venues and the expansion of existing live

music venues, which poses a number of risks, including:

•

construction of live music venues may result in cost overruns, delays or unanticipated expenses;
desirable sites for live music venues may be unavailable or costly; and
the attractiveness of our venue locations may deteriorate over time.

29
Additionally, the market potential of live music venue sites cannot be precisely determined, and our live music venues may face

competition in markets from unexpected sources. Newly constructed live music venues may not perform up to our expectations. We
face significant competition for potential live music venue locations and for opportunities to acquire existing live music venues.
Because of this competition, we may be unable to add to or maintain the number of our live music venues on terms we consider
acceptable.

Our revenue depends in part on the promotional success of our marketing campaigns, and there can be no assurance that such
advertising, promotional and other marketing campaigns will be successful or will generate revenue or profits.

Similar to many companies, we spend significant amounts on advertising, promotional, branding and other marketing campaigns
for our live music events, the Live Nation, Ticketmaster, www.ticketmaster.com, www.livenation.com and other brand names and other
business activities. Such marketing activities include, among others, promotion of events and ticket sales, premium seat sales,
hospitality and other services for our events and venues and advertising associated with our distribution of related merchandise and
apparel and costs related to search engine optimization and paid search engine marketing for our ecommerce sites. During 2012, we
spent approximately 3.9% of our revenue on marketing, including advertising. There can be no assurance that these marketing or
advertising efforts will be successful or will generate revenue or profits.

Poor weather adversely affects attendance at our live music events, which could negatively impact our financial performance
from period to period.

We promote and/or ticket many live music events. Weather conditions surrounding these events affect sales of tickets,
concessions and merchandise, among other things. Poor weather conditions can have a material effect on our results of operations
particularly because we promote and/or ticket a finite number of events. Due to weather conditions, we may be required to reschedule
an event to another available day or a different venue, which would increase our costs for the event and could negatively impact the
attendance at the event, as well as concession and merchandise sales. Poor weather can affect current periods as well as successive
events in future periods.

We may be adversely affected by the occurrence of extraordinary events, such as terrorist attacks.

The occurrence and threat of extraordinary events, such as terrorist attacks, intentional or unintentional mass-casualty incidents,
natural disasters or similar events, may substantially decrease the use of and demand for our services and the attendance at live music
events, which may decrease our revenue or expose us to substantial liability. The terrorism and security incidents in the past, military
actions in foreign locations and periodic elevated terrorism alerts have raised numerous challenging operating factors, including public
concerns regarding air travel, military actions and additional national or local catastrophic incidents, causing a nationwide disruption
of commercial and leisure activities.

Following past terrorism actions, some artists refused to travel or book tours, which adversely affected our business. The
occurrence or threat of future terrorist attacks, military actions by the United States or others, contagious disease outbreaks, natural
disasters such as earthquakes and severe floods or similar events cannot be predicted, and their occurrence can be expected to
negatively affect the economies of the United States and other foreign countries where we do business.

Risks Relating to Our Leverage

We have a large amount of debt and lease obligations that could restrict our operations and impair our financial condition.
As of December 31, 2012, our total indebtedness, excluding unamortized debt discounts and premiums, was approximately
$1.776 billion. Our available borrowing capacity under the revolving portion of our senior secured credit facility at that date was
approximately $236.1 million, with outstanding letters of credit of approximately $63.9 million. We may also incur significant
additional indebtedness in the future.

Our substantial indebtedness could have adverse consequences, including:

• making it more difficult for us to satisfy our obligations;
•

•

increasing our vulnerability to adverse economic, regulatory and industry conditions;
limiting our ability to obtain additional financing for future working capital, capital expenditures, mergers and other
purposes;
requiring us to dedicate a substantial portion of our cash flow from operations to fund payments on our debt, thereby
reducing funds available for operations and other purposes;
limiting our flexibility in planning for, or reacting to, changes in our business and the industry in which we operate;

•
• making us more vulnerable to increases in interest rates;

30
•

•

placing us at a competitive disadvantage compared to our competitors that have less debt; and
having a material adverse effect on us if we fail to comply with the covenants in the instruments governing our debt.

To service our debt and lease obligations and to fund potential acquisitions, artist and ticketing advances and capital
expenditures, we will require a significant amount of cash, which depends on many factors beyond our control.

As of December 31, 2012, approximately $62.1 million of our total indebtedness (excluding interest) is due in 2013, $344.0
million is due in the aggregate for 2014 and 2015, $876.7 million is due in the aggregate for 2016 and 2017 and $492.9 million is due
thereafter. In addition, as of December 31, 2012, we had approximately $2.0 billion in operating lease agreements, of which
approximately $118.9 million is due in 2013 and $114.4 million is due in 2014. See the table in Item 7. Management’s Discussion and
Analysis of Financial Condition and Results of Operations—Contractual Obligations and Commitments—Firm Commitments.

Our ability to service our debt and lease obligations and to fund potential acquisitions, artist and ticketing advances and capital

expenditures will require a significant amount of cash, which depends on many factors beyond our control. Our ability to make
payments on and to refinance our debt will also depend on our ability to generate cash in the future. This is, to an extent, subject to
general economic, financial, competitive, legislative, regulatory and other factors that are beyond our control.

We cannot assure you that our business will generate sufficient cash flow or that future borrowings will be available to us in an

amount sufficient to enable us to pay our debt or to fund our other liquidity needs. If our future cash flow from operations and other
capital resources are insufficient to pay our obligations as they mature or to fund our liquidity needs, we may be forced to reduce or
delay our business activities and capital expenditures, sell assets, obtain additional equity capital or restructure or refinance all or a
portion of our debt on or before maturity. In addition, the terms of our existing debt, including our senior secured credit facility, and
other future debt may limit our ability to pursue any of these alternatives.

These measures might also be unsuccessful or inadequate in permitting us to meet scheduled debt service or lease obligations.

We may be unable to restructure or refinance our obligations and obtain additional debt or equity financing or sell assets on
satisfactory terms or at all. Capital markets have been volatile in the recent past; a downturn could negatively impact our ability to
access capital should the need arise. As a result, the inability to meet our debt or lease obligations could cause us to default on those
obligations. Any such defaults could materially harm our financial condition and liquidity.

The agreements governing our senior secured credit facility and certain of our other indebtedness impose restrictions on us that
limit the discretion of management in operating our business and that, in turn, could impair our ability to meet our obligations
under our debt.

The agreements governing our senior secured credit facility and certain of our other indebtedness include restrictive covenants

that, among other things, restrict our ability to:
incur additional debt;
pay dividends and make distributions;

•

•
• make certain investments;
•

•

repurchase our stock and prepay certain indebtedness;
create liens;
enter into transactions with affiliates;

•
• modify the nature of our business;
•

enter into sale-leaseback transactions;
transfer and sell material assets; and

•
• merge or consolidate.

In addition, our senior secured credit facility includes other restrictions, including requirements to maintain certain financial
ratios. Our failure to comply with the terms and covenants in our indebtedness could lead to a default under the terms of the governing
documents, which would entitle the lenders to accelerate the indebtedness and declare all amounts owed due and payable.

These covenants could materially and adversely affect our ability to finance our future operations or capital needs. Furthermore,
they may restrict our ability to expand, to pursue our business strategies and otherwise to conduct our business. Our ability to comply
with these covenants may be affected by circumstances and events beyond our control, such as prevailing economic conditions and
changes in regulations, and we cannot assure you that we will be able to comply. A breach of these covenants could result in a default
under our debt. If there were an event of default under our outstanding indebtedness and the obligations there under accelerated, our
assets and cash flow might not be sufficient to repay our outstanding debt and we could be forced into bankruptcy.

31
We depend on the cash flows of our subsidiaries in order to satisfy our obligations.

We rely on distributions and loans from our subsidiaries to meet our payment requirements under our obligations. If our
subsidiaries are unable to pay dividends or otherwise make payments to us, we may not be able to make debt service payments on our
obligations. We conduct substantially all of our operations through our subsidiaries. Our operating cash flows and consequently our
ability to service our debt is therefore principally dependent upon our subsidiaries’ earnings and their distributions of those earnings to
us and may also be dependent upon loans or other payments of funds to us by those subsidiaries. Our subsidiaries are separate legal
entities and may have no obligation, contingent or otherwise, to pay any amount due pursuant to our obligations or to make any funds
available for that purpose. In addition, the ability of our subsidiaries to provide funds to us may be subject to restrictions under our
senior secured credit facility and may be subject to the terms of such subsidiaries’ future indebtedness, as well as the availability of
sufficient surplus funds under applicable law.

Any inability to fund the significant up-front cash requirements associated with our touring and ticketing businesses could
result in the loss of key tours or the inability to secure and retain ticketing clients.

In order to secure a tour, including global tours by major artists, we are often required to advance cash or post a letter of credit
to the artist prior to the sale of any tickets for that tour. Additionally, to secure new, or retain existing, ticketing clients, we are often
required by the client to make cash advances at the beginning and/or periodically during the term of the agreement. If we do not have
sufficient cash on hand or capacity under our credit facility to advance the necessary cash or post the required letter of credit, for any
given tour we would not be able to promote that tour and our touring business would be negatively impacted. Similarly, if we did not
have enough cash on hand, or access to cash, required to advance to new ticketing clients or to continue to pay advances under
existing ticketing agreements, our ticketing business would be negatively impacted.

Risks Relating to our 2.875% Convertible Senior Notes
We may not have the funds necessary to finance the repurchase of the notes or to pay the cash payable upon a conversion (if we
make the net share settlement election), or we may otherwise be restricted from making such payments, which may increase
note holders’ credit risk.

In July 2007, we issued $220 million of 2.875% convertible senior notes due 2027 in a private placement in the United States to

qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended. On July 15, 2014, July 15, 2017
and July 15, 2022, or in the event of a fundamental change (as defined in the indenture governing the notes), holders may require us to
repurchase their notes at a price of 100% of the principal amount of the notes, plus accrued and unpaid interest, including contingent
interest and additional amounts, to the repurchase date. In addition, at any time on or prior to June 15, 2027, we may irrevocably elect
net share settlement of the notes, and thereafter we will be required to make a cash payment of up to $1,000 for each $1,000 in
principal amount of notes converted. However, it is possible that we will not have sufficient funds available at such time to make the
required repurchase or settlement of converted notes. In addition, some of our existing financing agreements contain, and any future
credit agreements or other agreements relating to our indebtedness could contain, provisions prohibiting the repurchase of the notes
under certain circumstances, or could provide that a fundamental change constitutes an event of default under that agreement, restrict
our ability to make cash payments upon conversion of the notes or restrict the ability of our subsidiaries to make funds available to us
for that purpose. If any agreement governing our indebtedness prohibits or otherwise restricts us from repurchasing the notes or
making the cash payment upon conversion when we become obligated to do so, we could seek the consent of the lenders to repurchase
the notes or settle the conversion or attempt to refinance the other debt. If we do not obtain such consent or refinance the debt, we
would not be permitted to repurchase the notes or settle the conversion without potentially causing a default under the other debt. Our
failure to repurchase tendered notes or to pay any cash payable on a conversion would constitute an event of default under the
indenture, which might constitute a default under the terms of our other indebtedness.

The additional shares of common stock payable on any notes converted in connection with specified corporate transactions may
not adequately compensate holders of notes for any loss they may experience as a result of such specified corporate
transactions.

If certain specified corporate transactions occur on or prior to July 15, 2014, we will under certain circumstances increase the

conversion rate on notes converted in connection with the specified corporate transaction by a number of additional shares of common
stock. The number of additional shares of common stock will be determined based on the date on which the specified corporate
transaction becomes effective and the price paid per share of our common stock in the specified corporate transaction. The additional
shares of common stock issuable upon conversion of the notes in connection with a specified corporate transaction may not adequately
compensate holders of notes for any loss they may experience as a result of such specified corporate transaction. Furthermore, holders
of notes will not receive the additional consideration payable as a result of the increase in the conversion rate until the effective date of
the specified corporate transaction or later, which could be a significant period of time after holders of notes have tendered their notes
for conversion. If the specified corporate transaction occurs after July 15, 2014, or if the price paid per share of our common stock in
the specified corporate transaction is less than the common stock price at the date of issuance of the notes or above a specified price,
there will be no increase in the conversion rate. In addition, in certain circumstances upon a change of control arising from our
acquisition by a public company, we may elect to adjust the conversion rate and, if we so elect, holders of notes will not be entitled to
the increase in the conversion rate determined as described above.

32
The conditional conversion feature of the notes could result in holders of notes receiving less than the value of the common
stock for which a note would otherwise be convertible.

Prior to July 15, 2027, the notes are convertible for shares of our common stock (or cash or a combination of cash and shares of
our common stock) only if specified conditions are met. If the specific conditions for conversion are not met, holders of notes will not
be able to convert their notes, and they may not be able to receive the value of the common stock or cash and common stock, as
applicable, for which the notes would otherwise be convertible.

Upon conversion of the notes, holders of notes may receive less proceeds than expected because the value of our common stock
may decline after the exercise of the conversion right.

If we elect to settle conversions other than solely in shares of common stock, including by making a net share settlement
election, the conversion value that holders of notes will receive upon conversion of their notes are in part determined, subject to
certain exceptions, by the average of the last reported sale prices of our common stock for the 20 trading days beginning on the second
trading day immediately following the day the notes are tendered for conversion, or, if tendered within the 20 days leading up to the
maturity date or a specified redemption date, beginning on the fifth day following the maturity date or the redemption date.
Accordingly, if the price of our common stock decreases after holders of notes tender their notes for conversion, the conversion value
they will receive may be adversely affected.

The conversion rate of the notes may not be adjusted for all dilutive events.

The conversion rate of the notes is subject to adjustment only for certain specified events, including, but not limited to, the
issuance of stock dividends on our common stock, the issuance of certain rights or warrants, subdivisions, combinations, distributions
of capital stock, indebtedness or assets, cash dividends and certain issuer tender or exchange offers. However, the conversion rate will
not be adjusted for other events, such as an issuance of common stock for cash or acquisition, that may adversely affect the trading
price of the notes or the common stock, or for a third-party tender offer.

We cannot predict the prices at which our common stock may trade.

Risks Relating to Our Common Stock

Our stock price has fluctuated between $7.14 and $16.90 over the past three years. The market price of our common stock may

continue to fluctuate significantly due to a number of factors, some of which may be beyond our control, including:

•

our quarterly or annual earnings, or those of other companies in our industry;
actual or anticipated fluctuations in our operating results due to the seasonality of our business and other factors related to our
business;
our loss of or inability to obtain significant popular artists or ticketing clients;
changes in accounting standards, policies, guidance, interpretations or principles;
announcements by us or our competitors of significant contracts, acquisitions or divestitures;
the publication by securities analysts of financial estimates or reports about our business;
changes by securities analysts of earnings estimates or reports, or our inability to meet those estimates or achieve any goals
described in those reports;
the disclosure of facts about our business that may differ from those assumed by securities analysts in preparing their estimates
or reports about us;

• media reports, whether accurate or inaccurate;
•

the operating and stock price performance of other comparable companies;
overall market fluctuations; and
general economic conditions.

•

In particular, the realization of any of the risks described in these Risk Factors could have a significant and adverse impact on

the market price of our common stock.

In addition, in the past, some companies that have had volatile market prices for their securities have been subject to securities
class action suits filed against them. If a suit were to be filed against us, regardless of the outcome, it could result in substantial legal
costs and a diversion of our management’s attention and resources. This could have a material adverse effect on our business, results
of operations and financial condition.

33
Our corporate governance documents, rights agreement and Delaware law may delay or prevent an acquisition of us that
stockholders may consider favorable, which could decrease the value of our common stock.

Our amended and restated certificate of incorporation and amended and restated bylaws and Delaware law contain provisions

that could make it more difficult for a third party to acquire us without the consent of the board of directors. These provisions include
restrictions on the ability of our stockholders to remove directors and supermajority voting requirements for stockholders to amend our
organizational documents, a classified board of directors and limitations on action by our stockholders by written consent. In addition,
the board of directors has the right to issue preferred stock without stockholder approval, which could be used to dilute the stock
ownership of a potential hostile acquirer. Delaware law, for instance, also imposes some restrictions on mergers and other business
combinations between any holder of 15% or more of our outstanding common stock and us. Although we believe these provisions
protect our stockholders from coercive or otherwise unfair takeover tactics and thereby provide for an opportunity to receive a higher
bid by requiring potential acquirers to negotiate with the board of directors, these provisions apply even if the offer may be considered
beneficial by some stockholders.

Our amended and restated certificate of incorporation provides that, subject to any written agreement to the contrary, which
agreement does not currently exist, Clear Channel will have no duty to refrain from engaging in the same or similar business activities
or lines of business as us or doing business with any of our customers or vendors or employing or otherwise engaging or soliciting any
of our officers, directors or employees. Our amended and restated certificate of incorporation provides that if any director and/or
officer of the Company who is also a director and/or officer of Clear Channel acquires knowledge of a potential transaction or matter
which may be a corporate business opportunity (a “corporate opportunity”) for both us and Clear Channel, we will generally renounce
our interest in the corporate opportunity. Our amended and restated certificate of incorporation renounces any interest or expectancy in
such corporate opportunity that will belong to Clear Channel, unless such opportunity is offered to a director and/or officer of the
Company in writing solely in such person’s capacity as a director and/or officer of the Company. Clear Channel will, to the fullest
extent permitted by law, have satisfied its fiduciary duty with respect to such a corporate opportunity and will not be liable to us or our
stockholders for breach of any fiduciary duty by reason of the fact that it acquires or seeks the corporate opportunity for itself, directs
that corporate opportunity to another person or does not present that corporate opportunity to us. These provisions could make an
acquisition of us less advantageous to a third party.

We have also adopted a stockholder rights plan intended to deter hostile or coercive attempts to acquire us. Under the plan, if

any person or group acquires, or begins a tender or exchange offer that could result in such person acquiring, 15% or more of our
common stock, and in the case of certain Schedule 13G filers, 20% or more of our common stock, and in the case of Liberty Media
and certain of its affiliates, more than 35% of our common stock, without approval of the board of directors under specified
circumstances, our other stockholders have the right to purchase shares of our common stock, or shares of the acquiring company, at a
substantial discount to the public market price. Therefore, the plan makes an acquisition much more costly to a potential acquirer.

In addition, the terms of our senior secured credit facility provide that the lenders can require us to repay all outstanding

indebtedness upon a change of control. These provisions make an acquisition more costly to a potential acquirer. See Item 7.
Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources.

We have no plans to pay dividends on our common stock, which could affect its market price.

We currently intend to retain any future earnings to finance the growth, development and expansion of our business and/or to

repay existing indebtedness. Accordingly, we do not intend to declare or pay any dividends on our common stock for the foreseeable
future. The declaration, payment and amount of future dividends, if any, will be at the sole discretion of the board of directors after
taking into account various factors, including our financial condition, results of operations, cash flow from operations, current and
anticipated capital requirements and expansion plans, the income tax laws then in effect and the requirements of Delaware law. In
addition, the agreement governing our senior secured credit facility includes restrictions on our ability to pay cash dividends without
meeting certain financial ratios and obtaining the consent of the lenders. Accordingly, holders of common stock will not receive cash
payments on their investment and the market price may be adversely affected.

Future sales or other issuances of our common stock could adversely affect its market price.

We have a large number of shares of common stock outstanding and available for resale beginning at various points in time in

the future. Sales of a substantial number of shares of our common stock in the public market, or the possibility that these sales may
occur, could cause the market price for our common stock to decline. As of December 31, 2012, there were 190.9 million shares of
Live Nation common stock outstanding (including 3.2 million shares of unvested restricted stock awards), 15.5 million shares of
common stock issuable from options currently exercisable at a weighted average exercise price of $13.46 per share, 8.1 million shares
issuable from the conversion of our 2.875% convertible notes and a warrant to purchase 0.5 million shares of common stock at an
exercise price of $13.73.

34
We continually explore acquisition opportunities consistent with our strategy. These acquisitions may involve the payment of

cash, the incurrence of debt or the issuance of common stock or other securities. Any such issuance could be at a valuation lower than
the trading price of our common stock at the time. The price of our common stock could also be affected by possible sales of our
common stock by hedging or arbitrage trading activity that may develop involving our common stock. The hedging or arbitrage could,
in turn, affect the trading prices of our 2.875% convertible notes.

Conversion of our convertible notes may dilute the ownership interest of existing stockholders and may affect our per share
results and the trading price of our common stock.

The issuance of shares of our common stock upon conversion of our convertible notes may dilute the ownership interests of
existing stockholders. Issuances of stock on conversion may also affect our per share results of operations. Any sales in the public
market of our common stock issuable upon such conversion could adversely affect prevailing market prices of our common stock.

We can issue preferred stock without stockholder approval, which could materially adversely affect the rights of common
stockholders.

Our certificate of incorporation authorizes us to issue “blank check” preferred stock, the designation, number, voting powers,
preferences and rights of which may be fixed or altered from time to time by the board of directors. Our subsidiaries may also issue
additional shares of preferred stock. Accordingly, the board of directors has the authority, without stockholder approval, to issue
preferred stock with rights that could materially adversely affect the voting power or other rights of the common stockholders or the
market value of the common stock.

Risks Relating to the Separation

If the Separation were to fail to qualify as a transaction that is generally tax-free for United States federal income tax purposes,
we may be subject to significant tax liabilities.

In connection with the Separation, Clear Channel received both a private letter ruling from the IRS and a legal opinion
substantially to the effect that the distribution of our common stock to its stockholders qualified as a tax-free distribution for United
States federal income tax purposes under Sections 355 and 368(a)(1)(D) of the Internal Revenue Code of 1986, as amended, or the
Code. Notwithstanding receipt by Clear Channel of the ruling and the opinion of counsel, the IRS could assert that the Separation did
not qualify for tax-free treatment for United States federal income tax purposes. If the IRS were successful in taking this position,
Clear Channel could be subject to a significant United States federal income tax liability. In general, Clear Channel would be subject
to tax as if it had sold our common stock in a taxable sale for its fair market value. In addition, even if the Separation otherwise were
to qualify under Section 355 of the Code, it may be taxable to Clear Channel as if it had sold our common stock in a taxable sale for
its fair market value under Section 355(e) of the Code, if the Separation were later deemed to be part of a plan (or series of related
transactions) pursuant to which one or more persons acquire directly or indirectly stock representing a 50% or greater interest in Clear
Channel or us. For this purpose, any acquisitions of Clear Channel stock or of our stock within the period beginning two years before
the Separation and ending two years after, are presumed to be part of such a plan, although we or Clear Channel may be able to rebut
that presumption.

Although such corporate-level taxes, if any, resulting from a taxable distribution generally would be imposed on Clear Channel,
we have agreed in the tax matters agreement to indemnify Clear Channel and its affiliates against tax-related liabilities, if any, caused
by the failure of the Separation to qualify as a tax-free transaction under Section 355 of the Code (including as a result of
Section 355(e) of the Code) if the failure to so qualify is attributable to actions, events or transactions relating to our stock, assets or
business, or a breach of the relevant representations or covenants made by us in the tax matters agreement. If the failure of the
Separation to qualify under Section 355 of the Code is for any reason for which neither we nor Clear Channel is responsible, we and
Clear Channel have agreed in the tax matters agreement that we will each be responsible for 50% of the tax-related liabilities arising
from the failure to so qualify. Clear Channel reported a $2.4 billion capital loss as a result of the Separation.

We could be liable for income taxes owed by Clear Channel.

Each member of the Clear Channel consolidated group, which includes Clear Channel, us and our subsidiaries through
December 21, 2005, and Clear Channel’s other subsidiaries, is jointly and severally liable for the United States federal income tax
liability of each other member of the consolidated group. Consequently, we could be liable in the event any such liability is incurred,
and not discharged, by any other member of the Clear Channel consolidated group. Disputes or assessments could arise during future
audits by the IRS in amounts that we cannot quantify. In addition, Clear Channel recognized a capital loss for United States federal
income tax purposes in connection with the Separation. If Clear Channel were unable to deduct such capital loss for United States
federal income tax purposes as a result of any action we take following the Separation or our breach of a relevant representation or
covenant made by us in the tax matters agreement, we have agreed in the tax matters agreement to indemnify Clear Channel for the
lost tax benefits that Clear Channel would have otherwise realized if it were able to deduct this loss. See Item 8. Financial Statements
and Supplementary Data—Note 8—Related-Party Transactions—Relationship with Clear Channel.

35
Risks Relating to the Spin-off from IAC

If the spin-off of Ticketmaster from IAC or one or more of the Spincos were to fail to qualify as a transaction that is generally
tax-free for United States federal income tax purposes, we may be subject to significant tax liabilities.

In connection with IAC’s spin-off of each of the Spincos, IAC received a private letter ruling from the IRS regarding the
qualification of these spin-offs as transactions that are generally tax-free for United States federal income tax purposes. IAC’s spin-off
of each of the Spincos is referred to collectively as the IAC spin-offs. IAC also received an opinion of counsel regarding certain
aspects of the transaction that were not covered by the private letter ruling. Notwithstanding the IRS private letter ruling and opinion
of counsel, the IRS could determine that one or more of the IAC spin-offs should be treated as a taxable distribution if it determines
that any of the representations, statements or assumptions or undertakings that were included in the request for the IRS private letter
ruling are false or have been violated or if it disagrees with the conclusions in the opinion of counsel that are not covered by the IRS
ruling. In addition, if any of the representations, statements or assumptions upon which the opinion of counsel was based were or
become inaccurate, the opinion may be invalid.

If any of the IAC spin-offs were to fail to qualify as a transaction that is generally tax-free for United States federal income tax
purposes, then IAC would incur material income tax liabilities for which we, as successor-in-interest to Ticketmaster could be liable.
Under applicable federal income tax rules, Ticketmaster is severally liable for any federal income taxes imposed on IAC with respect
to taxable periods during which Ticketmaster was a member of IAC’s consolidated federal income tax return group, including the
period in which the IAC spin-offs were consummated. Under the tax sharing agreement that Ticketmaster entered into with IAC and
the other Spincos, Ticketmaster generally is required to indemnify IAC and the other Spincos for any taxes resulting from the spin-off
to the extent such amounts resulted from (i) any act or failure to act by Ticketmaster described in the covenants in the tax sharing
agreement, (ii) any acquisition of equity securities or assets of Ticketmaster or (iii) any breach by Ticketmaster of any representation
or covenant contained in the spin-off documents or in the documents relating to the IRS private letter ruling and/or tax opinions.
Corresponding indemnification provisions also apply to the other Spincos. Ticketmaster is entitled to indemnification from IAC,
among other things, if, Ticketmaster is liable for, or otherwise required to make a payment in respect of, a spin-off tax liability for
which Ticketmaster is not responsible under the tax sharing agreement and, if applicable, is unable to collect from the Spinco
responsible for such liability under the tax sharing agreement. Ticketmaster’s ability to collect under these indemnity provisions would
depend on the financial position of the indemnifying party.

Certain transactions in IAC, Ticketmaster, or other Spinco equity securities could cause one or more of the IAC spin-offs to be
taxable to IAC and may give rise to indemnification obligations of Ticketmaster under the tax sharing agreement.

Current United States federal income tax law creates a presumption that any of the IAC spin-offs would be taxable to IAC if it is
part of a “plan or series of related transactions” pursuant to which one or more persons acquire directly or indirectly stock representing
a 50% or greater interest (by vote or value) in IAC or a Spinco (including Ticketmaster). Acquisitions that occur during the four-year
period that begins two years before the date of a spin-off are presumed to occur pursuant to a plan or series of related transactions,
unless it is established that the acquisition is not pursuant to a plan or series of transactions that includes the spin-off.

These rules limited Ticketmaster’s ability during the two-year period following the Spin-off to enter into certain transactions

that might have otherwise been advantageous to us and our stockholders, particularly issuing equity securities to satisfy financing
needs, repurchasing equity securities, and, under certain circumstances, acquiring businesses or assets with equity securities or
agreeing to be acquired. Under the tax sharing agreement, there were restrictions on Ticketmaster’s ability to take such actions for a
period of 25 months from the day after the date of the spin-off. Entering into the merger agreement with Live Nation did not violate
these restrictions because, prior to entering into the agreement, Ticketmaster provided IAC with an unqualified opinion of tax counsel
contemplated by the tax sharing agreement and IAC confirmed that the opinion was satisfactory to IAC. We believe that we did not
take any actions during the two-year period following the spin-off that compromised the tax-free nature of that transaction. However,
the statutes of limitations related to these tax periods remain open, and if taxing authorities successfully assert tax claims against IAC
related to the spin-off, it could give rise to indemnification obligations of Ticketmaster under the tax sharing agreement.

In addition to actions of IAC and the Spincos (including Ticketmaster), certain transactions that are outside their control and

therefore not subject to the restrictive covenants contained in the Tax Sharing Agreement, such as a sale or disposition of the stock of
IAC or the stock of a Spinco by certain persons that own five percent or more of any class of stock of IAC or a Spinco could have a
similar effect on the tax-free status of a spin-off as transactions to which IAC or a Spinco is a party.

As a result of these rules, even if each IAC spin-off otherwise qualifies as a transaction that is generally tax-free for United

States federal income tax purposes, transactions involving Spinco or IAC equity securities (including transactions by certain
significant stockholders) could cause IAC to recognize taxable gain with respect to the stock of the Spinco as described above.
Although the restrictive covenants and indemnification provisions contained in the tax sharing agreement are intended to minimize the
likelihood that such an event will occur, one or more of the IAC spin-offs may become taxable to IAC as a result of transactions in
IAC or Spinco equity securities. As discussed previously, we, as successor-in-interest to Ticketmaster could be liable for such taxes
under the tax sharing agreement or under applicable federal income tax rules.

36
In connection with the Merger, Ticketmaster received (i) two unqualified opinions of tax counsel (one dated as of the date of

execution of the definitive merger agreement and one dated as of the closing date of the Merger) that the transaction as contemplated
in the definitive merger agreement would not have an adverse tax effect on the spin-off, and (ii) IAC’s written acknowledgement that
the closing date opinion was in form and substance satisfactory to IAC. However, the IRS may disagree with the conclusions in these
opinions of counsel and determine that the Merger caused the Spin-off to be taxable to IAC. Were this to occur and that position were
sustained, we, as successor-in-interest to Ticketmaster would be required to make material indemnification payments to IAC.

Risks Relating to the Merger

In connection with the Merger, we became subject to a Final Judgment imposing certain obligations and restrictions on us
which could negatively impact our business.

On July 30, 2010, the United States District Court for the District of Columbia approved and entered a Final Judgment relating
to the Merger that imposes certain obligations on us in order to address the issues the DOJ raised in its antitrust review of the Merger.
Among other things, the Final Judgment required us to offer a license to the Ticketmaster ticketing technology to AEG and to divest
Ticketmaster’s Paciolan ticketing business. We have entered into a license agreement with AEG and sold Paciolan to Comcast-
Spectacor, L.P., thus satisfying those two requirements. Prospectively, pursuant to the Final Judgment, we have agreed to abide by
certain behavioral remedies that prevent us from engaging in retaliatory business tactics or improper tying arrangements and to
provide periodic reports to the DOJ about our compliance with the Final Judgment. The Final Judgment is in effect and will bind us
until July 30, 2020.

During the duration of the Final Judgment, we are restricted from engaging in certain business activities that, absent the Final
Judgment, would be lawful for us to undertake. Our inability to undertake these business strategies could disadvantage us when we
compete against firms that are not restricted by any such order. Our compliance with the Final Judgment therefore creates certain
unquantifiable business risks for us.

Also, on January 25, 2010, we entered into a Consent Agreement with the Canadian Competition Commission, or the Canadian

Consent Agreement, which had the effect of imposing essentially the same terms as the Final Judgment on our business in Canada.
The Canadian Consent Agreement will remain in effect for ten years following the date of the agreement. The Canadian Consent
Agreement creates similar risks for us, both in terms of creating potential enforcement actions and in limiting us from pursuing certain
business practices.

ITEM 1B. UNRESOLVED STAFF COMMENTS

None.

ITEM 2.

PROPERTIES

As of December 31, 2012, we own, operate or lease 93 entertainment venues and 100 other facilities, including office leases,
throughout North America and 22 entertainment venues and 82 other facilities internationally. We believe our venues and facilities are
generally well-maintained and in good operating condition and have adequate capacity to meet our current business needs. We have a
lease ending June 30, 2020 for our corporate headquarters in Beverly Hills, California, used primarily by our executive and domestic
operations management staff.

Our leases are for varying terms ranging from monthly to multi-year. These leases can typically be for terms of three to five

years for our office leases and 10 to 20 years for our venue leases, and many provide for renewal options. There is no significant
concentration of venues under any one lease or subject to negotiation with any one landlord. We believe that an important part of our
management activity is to negotiate suitable lease renewals and extensions.

ITEM 3.
CTS Arbitration

LEGAL PROCEEDINGS

Live Nation Worldwide, Inc., or Live Nation Worldwide, and CTS were parties to an agreement, or the CTS Agreement,
pursuant to which CTS was to develop and Live Nation Worldwide licensed or agreed to use ticketing software or ticketing platforms.
Under the agreement, CTS was to develop software to be licensed to Live Nation Worldwide to provide ticketing services in the
United States and Canada. The CTS Agreement also generally required Live Nation Worldwide to use CTS’s ticketing platforms in
certain European countries so long as CTS’s existing platforms were appropriately modified to meet local market conditions. In June
2010, Live Nation Worldwide terminated the CTS Agreement because CTS materially breached the agreement by failing to deliver a
North American ticketing system that met the contractual requirements of being a “world class ticketing system . . . that fits the needs
of the North American market,” and by failing to deliver a ticketing system for the United Kingdom and other European countries that
fit the needs of those markets as required by the CTS Agreement.

37
For North America, had CTS performed on the CTS Agreement, it would have been generally entitled to receive, during the
then 10-year term of the CTS Agreement, a per ticket license fee upon the sale of certain tickets that Live Nation Worldwide or any of
certain of its subsidiaries, which are collectively referred to as Live Nation Worldwide entities, controlled and had the right to
distribute by virtue of certain promotion and venue management relations. This per ticket fee for events in North America was payable
to CTS regardless of whether the Live Nation Worldwide entities chose to use the CTS ticketing platform, Ticketmaster’s ticketing
platform or another ticketing platform for the sale of such controlled tickets. For events in certain European countries, not including
the United Kingdom, Live Nation Worldwide generally was required, during a 10-year term, to exclusively book on the CTS ticketing
platform all tickets that the Live Nation Worldwide entities had the right to distribute (or, to the extent other ticketing platforms were
used, Live Nation Worldwide was generally required to pay to CTS the same fee that would have been payable had the CTS platform
been used). For events in the United Kingdom, Live Nation Worldwide was required, for a 10-year term, to (i) book on the CTS
ticketing platform all tickets controlled by Live Nation Worldwide entities that were not allocated by Live Nation Worldwide for sale
through other sales channels and (ii) to offer for sale on the CTS UK website a portion of the tickets controlled by the Live Nation
Worldwide entities. Finally, the CTS Agreement obligated Live Nation Worldwide and CTS to negotiate a set of noncompete
agreements that, subject to legal restrictions, could have precluded Live Nation Worldwide from offering primary market ticketing
services to third parties in certain European countries during the term of the CTS Agreement.

In April 2010, CTS filed a request for arbitration with the International Court of Arbitration of the International Chamber of

Commerce, or ICC, pursuant to the CTS Agreement. In its request for arbitration, CTS asserts, among other things, that (i) the terms
of the CTS Agreement, including the North America per ticket license fee, European exclusivity obligations and United Kingdom
distribution obligations described above, apply to tickets sold and distributed by Ticketmaster, (ii) Ticketmaster’s sales and
distribution of tickets following the completion of the Merger have resulted in various breaches of Live Nation Worldwide’s
obligations under the CTS Agreement, (iii) Live Nation has failed to allocate the proper number of tickets to CTS’s system in the
United Kingdom and (iv) the Merger and our subsequent actions have breached the implied covenant of good faith and fair dealing. In
its request for arbitration, CTS seeks relief in the form of a declaration that Live Nation and Live Nation Worldwide are in breach of
the CTS Agreement and the implied covenant of good faith and fair dealing, specific performance of Live Nation Worldwide’s
obligations under the CTS Agreement, and unspecified damages resulting from such breaches. In March 2011, CTS provided further
specifications on its claims and purported damages, including a claim for royalties that would have been paid over the contemplated
10-year term of the CTS Agreement and on Ticketmaster-controlled tickets (as well as tickets controlled by Live Nation Worldwide or
any of certain of its subsidiaries).

In May 2010, we responded to CTS’s request for arbitration and filed counterclaims asserting that CTS breached the CTS
Agreement by failing to provide ticketing platforms that met the standard required by the CTS Agreement for the North American and
European markets. We are seeking relief primarily in the form of damages and a declaration that we validly terminated the CTS
Agreement based on CTS’s material breaches. We deny that CTS is entitled to collect damages for royalties that would have been paid
over the full 10-year term of the CTS Agreement or on Ticketmaster-controlled tickets. The matter has been assigned to an arbitrator,
and hearings were conducted in the summer and fall of 2011. A decision from the arbitrator is currently expected by spring of 2013.
While we do not believe that a loss is probable of occurring at this time, if the arbitrator rules against us on any or all claims, the
amounts at stake could be substantial. Considerable uncertainty remains regarding the validity of the claims and damages asserted
against us. As a result, we are currently unable to estimate the possible loss or range of loss for this matter. We intend to continue to
vigorously defend the action.

Ticketing Fees Consumer Class Action Litigation

In October 2003, a putative representative action was filed in the Superior Court of California challenging Ticketmaster’s

charges to online customers for shipping fees and alleging that its failure to disclose on its website that the charges contain a profit
component is unlawful. The complaint asserted a claim for violation of California’s Unfair Competition Law, or UCL, and sought
restitution or disgorgement of the difference between (i) the total shipping fees charged by Ticketmaster in connection with online
ticket sales during the applicable period, and (ii) the amount that Ticketmaster actually paid to the shipper for delivery of those tickets.
In August 2005, the plaintiffs filed a first amended complaint, then pleading the case as a putative class action and adding the claim
that Ticketmaster’s website disclosures in respect of its ticket order processing fees constitute false advertising in violation of
California’s False Advertising Law. On this new claim, the amended complaint seeks restitution or disgorgement of the entire amount
of order processing fees charged by Ticketmaster during the applicable period. In April 2009, the Court granted the plaintiffs’ motion
for leave to file a second amended complaint adding new claims that (a) Ticketmaster’s order processing fees are unconscionable
under the UCL, and (b) Ticketmaster’s alleged business practices further violate the California Consumer Legal Remedies Act.
Plaintiffs later filed a third amended complaint, to which Ticketmaster filed a demurrer in July 2009. The Court overruled
Ticketmaster’s demurrer in October 2009.

38
The plaintiffs filed a class certification motion in August 2009, which Ticketmaster opposed. In February 2010, the Court
granted certification of a class on the first and second causes of action, which allege that Ticketmaster misrepresents/omits the fact of
a profit component in Ticketmaster’s shipping and order processing fees. The class would consist of California consumers who
purchased tickets through Ticketmaster’s website from 1999 to present. The Court denied certification of a class on the third and
fourth causes of action, which allege that Ticketmaster’s shipping and order processing fees are unconscionably high. In March 2010,
Ticketmaster filed a Petition for Writ of Mandate with the California Court of Appeal, and plaintiffs also filed a motion for
reconsideration of the Superior Court’s class certification order. In April 2010, the Superior Court denied plaintiffs’ Motion for
Reconsideration of the Court’s class certification order, and the Court of Appeal denied Ticketmaster’s Petition for Writ of Mandate.
In June 2010, the Court of Appeal granted the plaintiffs’ Petition for Writ of Mandate and ordered the Superior Court to vacate its
February 2010 order denying plaintiffs’ motion to certify a national class and enter a new order granting plaintiffs’ motion to certify a
nationwide class on the first and second claims. In September 2010, Ticketmaster filed its Motion for Summary Judgment on all
causes of action in the Superior Court, and that same month plaintiffs filed their Motion for Summary Adjudication of various
affirmative defenses asserted by Ticketmaster. In November 2010, Ticketmaster filed their Motion to Decertify Class.

In December 2010, the parties entered into a binding agreement providing for the settlement of the litigation and the resolution
of all claims therein. In September 2011, the Court declined to approve the settlement in its then-current form. Litigation continued,
and in September 2011, the Court granted in part and denied in part Ticketmaster’s Motion for Summary Judgment. The parties
reached a new settlement in September 2011, which was approved preliminarily, but in September 2012 the Court declined to grant
final approval. In doing so, the court identified potential modifications to the settlement, and the parties continue to discuss such
potential modifications and the possibility of a revised settlement agreement. Ticketmaster and its parent, Live Nation, have not
acknowledged any violations of law or liability in connection with the matter.

As of December 31, 2012, we have accrued $35.4 million, our best estimate of the probable costs associated with the settlement
referred to above. This liability includes an estimated redemption rate. Any difference between our estimated redemption rate and the
actual redemption rate we experience will impact the final settlement amount; however, we do not expect this difference to be
material.

Canadian Consumer Class Action Litigation Relating to TicketsNow

In February 2009, four putative consumer class action complaints were filed in various provinces of Canada against

TicketsNow, Ticketmaster, Ticketmaster Canada Ltd. and Premium Inventory, Inc. All of the cases allege essentially the same set of
facts and causes of action. Each plaintiff purports to represent a class consisting of all persons who purchased a ticket from
Ticketmaster, Ticketmaster Canada Ltd. or TicketsNow from February 2007 to present and alleges that Ticketmaster conspired to
divert a large number of tickets for resale through the TicketsNow website at prices higher than face value. The plaintiffs characterize
these actions as being in violation of Ontario’s Ticket Speculation Act, the Amusement Act of Manitoba, the Amusement Act of
Alberta or the Quebec Consumer Protection Act. The Ontario case contains the additional allegation that Ticketmaster’s and
TicketsNow’s service fees violate anti-scalping laws. Each lawsuit seeks compensatory and punitive damages on behalf of the class.

In February 2012, the parties entered into a settlement agreement that will resolve all of the resale market claims. The court

approval process for the settlement has been completed, with final approvals given in all provinces.

As of December 31, 2012, we have accrued our best estimate of the probable costs associated with the resale market claims of

this matter, the full amount of which was funded by an escrow established in connection with Ticketmaster’s 2008 acquisition of
TicketsNow.

While it is reasonably possible that a loss related to the primary market claims of this matter could be incurred by us in a future

period, we do not believe that a loss is probable of occurring at this time. Considerable uncertainty remains regarding the validity of
the claims and damages asserted against us. As a result, we are currently unable to estimate the possible loss or range of loss for the
primary market claims of this matter. We intend to continue to vigorously defend all claims in all of the actions.

Other Litigation

From time to time, we are involved in other legal proceedings arising in the ordinary course of our business, including

proceedings and claims based upon violations of antitrust laws and intellectual property rights, and tortious interference, which could
cause us to incur significant expenses. We have also been the subject of personal injury and wrongful death claims relating to
accidents at our venues in connection with our operations. As required, we have accrued our estimate of the probable settlement or
other losses for the resolution of any outstanding claims. These estimates have been developed in consultation with counsel and are
based upon an analysis of potential results, including, in some cases, estimated redemption rates for the settlement offered, assuming a
combination of litigation and settlement strategies. It is possible, however, that future results of operations for any particular period
could be materially affected by changes in our assumptions or the effectiveness of our strategies related to these proceedings. In
addition, under our agreements with Clear Channel, we have assumed and will indemnify Clear Channel for liabilities related to our
business for which they are a party in the defense.

39
As of December 31, 2012, we have accrued $40.6 million for the specific cases discussed above as our best estimate of the

probable costs of legal settlement, including $35.4 million for the Ticketing Fees Consumer Class Action litigation settlement.

PART II

ITEM 5.

MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND
ISSUER PURCHASES OF EQUITY SECURITIES

Our common stock was listed on the New York Stock Exchange under the symbol “LYV” on December 21, 2005. There were

4,608 stockholders of record as of February 20, 2013. This figure does not include an estimate of the indeterminate number of
beneficial holders whose shares may be held of record by brokerage firms and clearing agencies. The following table presents the high
and low sales prices of the common stock on the New York Stock Exchange during the calendar quarter indicated.

Common Stock
Market Price

High

Low

2011
First Quarter............................................................................................................................................................... $ 11.96 $ 9.82
Second Quarter .......................................................................................................................................................... $ 11.59 $ 9.70
Third Quarter ............................................................................................................................................................. $ 12.44 $ 7.66
Fourth Quarter............................................................................................................................................................ $
9.88 $ 7.14
2012
First Quarter............................................................................................................................................................... $ 11.00 $ 8.54
9.90 $ 8.10
Second Quarter .......................................................................................................................................................... $
9.76 $ 8.37
Third Quarter ............................................................................................................................................................. $
9.69 $ 8.16
Fourth Quarter............................................................................................................................................................ $

Dividend Policy

Since the Separation and through December 31, 2012, we have not declared or paid any dividends. We presently intend to retain
any future earnings to finance the expansion of our business. Therefore, we do not expect to pay any cash dividends in the foreseeable
future. Moreover, the terms of our senior secured credit facility limit the amount of funds that we will have available to declare and
distribute as dividends on our common stock. Payment of future cash dividends, if any, will be at the discretion of our board of
directors in accordance with applicable law after taking into account various factors, including our financial condition, operating
results, current and anticipated cash needs, plans for expansion and contractual restrictions with respect to the payment of dividends.

ITEM 6.

SELECTED FINANCIAL DATA

2012

Year Ended December 31,
2010

2009

2011

2008

(in thousands except per share data)
Results of Operations Data (1):
Revenue ............................................................ $
Operating income (loss).................................... $
Loss from continuing operations before

5,819,047 $
(21,639) $

5,383,998 $
18,337 $

5,063,748 $
(63,700) $

4,181,021 $
(52,356) $

4,085,306
(297,293)

income taxes................................................. $

(132,161) $

(96,627) $

(188,654) $

(114,678) $

(357,735)

Net loss attributable to common stockholders

of Live Nation Entertainment, Inc................ $

(163,227) $

(83,016) $

(228,390) $

(60,179) $

(239,412)

Basic and diluted loss from continuing
operations attributable to common
stockholders of Live Nation Entertainment,
Inc. ............................................................... $

(0.87) $

(0.46) $

(1.36) $

(1.65) $

(4.39)

Cash dividends per share .................................. $

- $

(in thousands)
Balance Sheet Data (1):
Total assets.......................................................... $
Long-term debt, net (including current

2012

2011

As of December 31,
2010

2009

2008

5,290,806 $

5,077,344 $

5,195,560 $

2,341,759 $

2,476,723

maturities) ...................................................... $
Redeemable preferred stock................................ $

1,740,005 $
- $

1,705,261 $
- $

1,731,864 $
- $

740,069 $
40,000 $

824,120
40,000

(1) Acquisitions and dispositions significantly impact the comparability of the historical consolidated financial data reflected in this

schedule of Selected Financial Data.

The Selected Financial Data should be read in conjunction with Item 7. Management’s Discussion and Analysis of Financial

Condition and Results of Operations.

ITEM 7.

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

You should read the following discussion of our financial condition and results of operations together with the audited
consolidated financial statements and notes to the financial statements included elsewhere in this Annual Report. This discussion
contains forward-looking statements that involve risks and uncertainties. The forward-looking statements are not historical facts, but
rather are based on current expectations, estimates, assumptions and projections about our industry, business and future financial
results. Our actual results could differ materially from the results contemplated by these forward-looking statements due to a number
of factors, including those discussed under 1A.—Risk Factors and other sections in this Annual Report.

Executive Overview

In 2012, we delivered growth in ticket sales, revenue and operating results. Our strategy remains focused on leveraging our
leadership position in the live entertainment industry to reach fans through the live concert experience in order to sell more tickets and
grow our sponsorship and advertising revenue, while continuing to optimize our cost structure. We believe as the leading, global live
event and ticketing company that we are well-positioned to better serve artists, teams, fans and venues.

Our Concerts segment sold more tickets, even with slightly fewer events in 2012, which delivered higher revenue as compared
to last year. Overall, we delivered higher attendance per show at our owned and/or operated amphitheaters and improved the ancillary
net revenue per attendee at these venues. We continued to focus on festivals, including improvement of key European festival event
profitability, expanding our portfolio of electronic dance music events, with the acquisition of the Creamfields brand, as well as
investing in new festivals. We also were successful in expanding geographically, increasing the reach of our promotion activity in
Australia with the acquisition of Coppel and adding offices in additional countries in Asia, either on our own or with strategic
partners.

Our Ticketing segment sold more tickets this year as compared to last year driven primarily by increases in concerts and sports

tickets. Overall, our revenue and operating results improved due to these higher ticket volumes along with higher resale market
activity. During the year, we successfully completed the 2012 London Olympics as its official ticket seller. Investment in our ticketing
platform is in the second year of the planned three-year development and we rolled out several enhancements to our clients during the
year. We will continue to invest in a variety of initiatives aimed at improving the ticket buying process and overall fan and venue
experience.

Our Artist Nation segment is focused on serving our existing artists as well as developing new relationships with top artists and

extending our various services provided. We expect that our performance in this business will improve as we empower the next
generation of the industry’s top managers to more effectively tap into the assets of our Ticketing, Concerts, and Sponsorship &
Advertising platforms.

Our Sponsorship & Advertising segment again delivered growth in revenue and operating results driven by increased

advertising revenue on our websites and the renewal and growth of sponsorships from brand relationships. Our extensive on-site and
online reach, global venue distribution network, artist relationships and ticketing operations are the key to securing long-term
sponsorship agreements with major brands and we continue to look for ways to expand these assets and to extend further
internationally in new markets.

We continue to be optimistic about the long-term potential of our Company and we are focused on the key elements of our

business model – expanding our concert platform to sell more tickets, driving conversion of ticket sales through social and mobile
channels, growing our sponsorship and online revenue and selling more tickets for our Ticketmaster clients while driving reductions in
the ticketing cost structure.

Segment Overview

Our reportable segments are Concerts, Ticketing, Artist Nation and Sponsorship & Advertising. Prior to 2012 we reported an

The segment results for the prior periods have been reclassified to conform to the current year presentation.

Concerts

Our Concerts segment principally involves the global promotion of live music events in our owned and/or operated venues and

in rented third-party venues, the operation and management of music venues and the production of music festivals across the world.
While our Concerts segment operates year-round, we generally experience higher revenue during the second and third quarters due to
the seasonal nature of shows at our outdoor amphitheaters and festivals, which primarily occur May through September. Revenue and
related costs for events are generally deferred and recognized when the event occurs. All advertising costs for shows are expensed at
the end of the year for any future events.

To judge the health of our Concerts segment, we primarily monitor the number of confirmed events in our network of owned

and/or operated and third-party venues, talent fees, average paid attendance and advance ticket sales. In addition, at our owned and/or
operated venues, we monitor attendance, ancillary revenue per fan and premium seat sales. For business that is conducted in foreign
markets, we also compare the operating results from our foreign operations to prior periods on a constant currency basis.

Ticketing

The Ticketing segment is primarily an agency business that sells tickets for events on behalf of our clients and retains a
convenience charge and order processing fee for our services. We sell tickets through a combination of websites, telephone services
and ticket outlets. Our ticketing sales are impacted by fluctuations in the availability of events for sale to the public, which may vary
depending upon scheduling by our clients. Our Ticketing segment also manages our online activities including enhancements to our
websites and bundling product offerings. Through our websites, we sell tickets to our own events as well as tickets for our ticketing
clients and provide event information. Revenue related to ticketing service charges for our events where we control ticketing is
deferred and recognized as the event occurs.

42
To judge the health of our Ticketing segment, we primarily review the number of tickets sold through our ticketing operations,

average convenience charges and order processing fees, the number of client tickets renewed or added and the average royalty rate
paid to clients who use our ticketing services. In addition, we review the number of visits to our websites, the overall number of
customers in our database and the revenue related to the sale of other products on our websites. For business that is conducted in
foreign markets, we also compare the operating results from our foreign operations to prior periods on a constant currency basis.

Artist Nation

The Artist Nation segment primarily provides management services to music artists in exchange for a commission on the
earnings of these artists. Our Artist Nation segment also sells merchandise associated with music artists at live performances, to
retailers and directly to consumers via the internet and provides other services to artists. Revenue earned from our Artist Nation
segment is impacted to a large degree by the touring schedules of the artists we represent. Generally, we experience higher revenue
during the second and third quarters as the period from May through September tends to be a popular time for touring events.

To judge the health of our Artist Nation segment, we primarily review the average annual earnings of each artist represented and
the percentage of top artists on tour or with planned album releases as these activities tend to drive higher revenue. For business that is
conducted in foreign markets, we compare the operating results from our foreign operations to prior periods on a constant currency
basis.

Sponsorship & Advertising

Our Sponsorship & Advertising segment employs a sales force that creates and maintains relationships with sponsors through a
combination of strategic, international, national and local opportunities that allow businesses to reach customers through our concert,
venue, artist relationship and ticketing assets, including advertising on our websites. We work with our corporate clients to help create
marketing programs that drive their business goals and connects their brands directly with fans and artists.

To judge the health of our Sponsorship & Advertising segment, we primarily review the average revenue per sponsor, the total
revenue generated through sponsorship arrangements, percentage of expected revenue under contract and the online revenue received
from sponsors advertising on our websites.

See further discussion of our segments in Item 1. Business—Our Business.

43
Consolidated Results of Operations

2012

Year Ended December 31,
2011
(in thousands)

2010

% Change
2012 vs 2011

% Change
2011 vs 2010

Revenue .............................................. $ 5,819,047
Operating expenses:

5,383,998

$ 5,063,748

3,789,488

3,658,310

1,111,969
343,018

1,014,491
321,666

978
112,157
8,051
18,337

374
110,252
22,355
(63,700)

10%

3%
25%

*
1%
*
*

10%
7%

*
2%
*
*

4,151,277

1,143,632
429,557

(514)
113,364
3,370
(21,639)

Direct operating expenses ..............
Selling, general and administrative
expenses ....................................
Depreciation and amortization .......
Loss (gain) on sale of operating

assets .........................................
Corporate expenses ........................
Acquisition transaction expenses ...
Operating income (loss)......................
Operating margin ................................

Interest expense...................................
Loss (gain) on extinguishment

of debt ............................................
Interest income....................................
Equity in earnings of nonconsolidated
affiliates..........................................
Other expense (income), net ...............
Loss from continuing operations

before income taxes........................
Income tax expense (benefit) ..............
Loss from continuing operations.........
Loss from discontinued operations,

net of tax ........................................
Net loss ...............................................
Net income attributable to

noncontrolling interests..................

Net loss attributable to common
stockholders of Live Nation
Entertainment, Inc. ......................... $

(0.4)%

0.3%

(1.3)%

123,740

120,414

116,527

(460)
(4,170)

(9,921)
1,333

(132,161)
29,736
(161,897)

-
(161,897)

1,330

-
(4,215)

(7,742)
6,507

(96,627)
(26,224)
(70,403)

-
(70,403)

12,613

21,315
(3,771)

(4,928)
(4,189)

(188,654)
15,154
(203,808)

(4,228)
(208,036)

20,354

(163,227)

(83,016)

(228,390)

Notes: Acquisitions and dispositions significantly impact the comparability of the historical consolidated financial data reflected in

this schedule of Consolidated Results of Operations.

Percentages are not meaningful.

Key Operating Metrics

Concerts (1)

Total estimated events:.................................................................................
North America ....................................................................................
International........................................................................................
Total estimated events ...............................................................
Total estimated attendance (rounded): .........................................................
North America ....................................................................................
International........................................................................................
Total estimated attendance ........................................................
Ancillary net revenue per attendee:..............................................................

North America amphitheaters ............................................................. $
International festivals.......................................................................... $

Ticketing (2) (4)

Number of tickets sold (in thousands):.........................................................
Concerts ..............................................................................................
Sports ..................................................................................................
Arts and theater...................................................................................
Family .................................................................................................
Other (3)..............................................................................................

Gross value of tickets sold (in thousands) .................................................... $
Number of customers in database (rounded) ................................................

Sponsorship & Advertising

Year Ended December 31,
2011

2012

2010

14,962
7,000
21,962

15,531
6,720
22,251

14,119
6,971
21,090

32,007,000
16,750,000
48,757,000

31,060,000
15,742,000
46,802,000

30,603,000
16,659,000
47,262,000

18.56 $
15.55 $

18.11 $
16.62 $

17.57
15.95

75,372
28,760
19,961
15,970
7,669
147,732
9,146,254 $

71,632
27,055
21,891
14,248
6,541
141,367
8,441,230 $

119,592,000

110,208,000

63,833
22,074
18,462
11,469
4,420
120,258
7,466,957
98,007,000

Sponsorship revenue (in thousands) ............................................................. $
Online advertising revenue (in thousands) ................................................... $

191,773 $
56,148 $

179,734 $
51,057 $

161,653
38,493

(1) Events generally represent a single performance by an artist. Attendance generally represents the number of fans who were

present at an event. Festivals are counted as one event in the quarter in which the festival begins but attendance is split over the
days of the festival and can be split between quarters. Events and attendance metrics are estimated each quarter.

(2) The number and gross value of tickets sold includes primary tickets only and excludes tickets sold for the 2012 Olympics. These

metrics include tickets sold during the period regardless of event timing except for our promoted concerts in our owned and/or
operated venues and in certain European territories where these tickets are recognized as the concerts occur. The tickets sold
listed above for 2010 do not include 7.1 million tickets with a gross value of $406.4 million for the pre-Merger period. Tickets
sold for the full year ended December 31, 2010, including the pre-Merger period, were as follows:

Concerts............................................................................
Sports................................................................................
Arts and theater.................................................................
Family...............................................................................
Other.................................................................................

66,843
23,733
19,709
12,467
4,651
127,403

(3) Other category includes tickets for comedy shows, facility tours, donations, lectures, seminars and cinemas.
(4) The total number of tickets sold for the years ended December 31, 2012, 2011 and 2010 do not include 108 million, 135 million

and 112 million, respectively, of tickets sold through our venue clients’ box offices for which we do not receive a fee.

Revenue

Our revenue increased $435.0 million, or 8%, during the year ended December 31, 2012 as compared to the prior year. The

overall increase in revenue was primarily due to increases in our Concerts and Ticketing segments of $364.2 million and $54.7
million, respectively. Excluding the decreases of approximately $100.4 million related to the impact of changes in foreign exchange
rates, revenue increased $535.4 million, or 10%.

Our revenue increased $320.3 million, or 6%, during the year ended December 31, 2011 as compared to the prior year. The

overall increase in revenue was primarily due to increases in our Concerts, Ticketing, Artist Nation and Sponsorship & Advertising
segments of $67.8 million, $194.6 million, $31.0 million and $30.6 million, respectively. The overall increase included incremental
revenue of $77.3 million resulting from the timing of the Merger. Excluding the increases of approximately $132.9 million related to
the impact of changes in foreign exchange rates, revenue increased $187.4 million, or 4%.

More detailed explanations of the changes for the years ended 2012 and 2011 are included in the applicable segment discussions

contained herein.

Direct operating expenses

Our direct operating expenses increased $361.8 million, or 10% during the year ended December 31, 2012 as compared to the

prior year. The overall increase in direct operating expenses was primarily due to increases in our Concerts and Ticketing segments of
$328.5 million and $32.7 million, respectively. Excluding the decreases of approximately $77.4 million related to the impact of
changes in foreign exchange rates, direct operating expenses increased $439.2 million, or 12%.

Our direct operating expenses increased $131.2 million, or 4%, during the year ended December 31, 2011 as compared to the

prior year. The overall increase in direct operating expenses was primarily due to increases in our Concerts, Ticketing and Artist
Nation segments of $36.1 million, $69.6 million and $27.9 million, respectively. The overall increase included incremental direct
operating expenses of $34.1 million resulting from the timing of the Merger. Excluding the increases of approximately $102.3 million
related to the impact of changes in foreign exchange rates, direct operating expenses increased $28.9 million, or 1%.

Direct operating expenses include artist fees, ticketing client royalties, show-related marketing and advertising expenses along

with other costs.

More detailed explanations of the changes for the years ended 2012 and 2011 are included in the applicable segment discussions

contained herein.

Selling, general and administrative expenses

Our selling, general and administrative expenses increased $31.7 million, or 3%, during the year ended December 31, 2012 as

compared to the prior year. The overall increase in selling, general and administrative expenses was primarily due to an increase in our
Concerts segment of $34.1 million. Excluding the decreases of approximately $15.1 million related to the impact of changes in foreign
exchange rates, selling, general and administrative expenses increased $46.8 million, or 4%.

Our selling, general and administrative expenses increased $97.5 million, or 10%, during the year ended December 31, 2011 as
compared to the prior year. The overall increase in selling, general and administrative expenses was primarily due to increases in our
Ticketing and Artist Nation segments of $65.9 million and $19.2 million, respectively, driven by the incorporation of the Ticketmaster
results after the completion of the Merger. Excluding the increases of approximately $17.6 million related to the impact of changes in
foreign exchange rates, selling, general and administrative expenses increased $79.9 million, or 8%.

More detailed explanations of the changes for the years ended 2012 and 2011 are included in the applicable segment discussions

contained herein.

Depreciation and amortization

Our depreciation and amortization increased $86.5 million, or 25%, during the year ended December 31, 2012 as compared to
the prior year. The overall increase in depreciation and amortization was primarily due to increases in our Concerts and Artist Nation
segments of $13.1 million and $65.3 million, respectively. During 2012, we recorded an impairment charge primarily related to
client/vendor relationship intangible assets in the Artist Nation segment and revenue-generating contracts and client/vendor
relationships in the Concerts segment. Excluding the decreases of approximately $2.4 million related to the impact of changes in
foreign exchange rates, depreciation and amortization expense increased $88.9 million, or 26%.

46
Our depreciation and amortization increased $21.4 million, or 7%, during the year ended December 31, 2011 as compared to the

prior year. The overall increase in depreciation and amortization was primarily due to increases in our Ticketing and Artist Nation
segments of $19.1 million and $8.9 million, respectively, partially offset by a decrease in our Concerts segment of $6.7 million.
During 2011, we recorded an impairment charge of $24.1 million related primarily to two amphitheaters, a music theater, a club and
contract intangibles. Excluding the increases of approximately $3.4 million related to the impact of changes in foreign exchange rates,
depreciation and amortization expense increased $18.0 million, or 6%.

Acquisition transaction expenses

Acquisition transaction expenses were $3.4 million, $8.1 million and $22.4 million during the years ended December 31, 2012,
2011 and 2010, respectively. All years include current year acquisition costs that vary based on the size and number of acquisitions in
the year. In addition, 2011 and 2010 expenses also include ongoing litigation costs relating to the Merger along with changes in the
fair value of acquisition-related contingent consideration. The 2010 acquisition transaction expenses are higher primarily due to costs
associated with the completion of the Merger.

Interest expense

Interest expense increased $3.3 million, or 3%, for the year ended December 31, 2012 as compared to the prior year primarily
due to additional term loan B borrowings under our senior secured credit facility and the costs related to the issuance in 2012 of the
7% senior notes and redemption of the 10.75% senior notes.

Interest expense increased $3.9 million, or 3%, for the year ended December 31, 2011 as compared to the prior year primarily

due to higher debt balances from the debt obtained in the Merger for a full year.

Our debt balances and weighted average cost of debt, excluding unamortized debt discounts and premiums were $1.776 billion

and 5.2%, respectively, at December 31, 2012, and $1.732 billion and 6.0%, respectively, at December 31, 2011.

Loss on extinguishment of debt

We recorded a loss on extinguishment of debt of $21.3 million for the year ended December 31, 2010, related to the replacement

of our two senior secured credit facilities and the redemption of our redeemable preferred stock in May 2010 with a new senior
secured credit facility that provides for $1.2 billion in total credit availability.

Other (income) expense, net

Other expense of $6.5 million for the year ended December 31, 2011 includes the impact of changes in foreign exchange rates

of $5.1 million in 2011.

Other income of $4.2 million for the year ended December 31, 2010 includes the impact of changes in foreign exchange rates of

$2.8 million in 2010.

Income taxes

Our 2012 effective tax rate of (22)% represented a net tax expense of $29.7 million on losses from continuing operations before

tax of $132.2 million compared to our 2011 effective tax rate of 27% which represented a net tax benefit of $26.2 million on losses
from continuing operations before tax of $96.6 million for the years ended December 31, 2012 and 2011, respectively. In 2012,
income tax expense includes $19.5 million related to statutory expense for foreign entities, $3.9 million current tax expense for state
and local income taxes, $4.0 million deferred state income tax primarily related to blended state rate changes and other tax expense of
approximately $2.3 million. The net increase in 2012 tax expense as compared to 2011 is principally driven by the 2011 valuation
allowance release of $39.5 million related to the 2011 federal tax consolidation of Front Line with the Company’s other domestic
operations.

Our effective tax rate for 2011 was 27% as compared to an effective tax rate of (8)% for 2010. The higher net tax benefit in
2011 as compared to 2010 is principally driven by higher tax benefits recognized in 2011 related to the 2011 federal tax consolidation
of Front Line with the Company’s other domestic operations.

Discontinued operations

For the year ended December 31, 2010, we reported $4.2 million of additional expense related to the 2009 sale of our U.K.

theatrical business as a loss on disposal.

47
Net income attributable to noncontrolling interests

Net income attributable to noncontrolling interests decreased $11.3 million during the year ended December 31, 2012 as
compared to the prior year primarily due to reduced operating results of various artist management businesses resulting from an
impairment of a client/vendor relationship intangible.

Net income attributable to noncontrolling interests decreased $7.7 million during the year ended December 31, 2011 as
compared to the prior year primarily due to reduced operating results for various entities, primarily internationally, along with the
2011 acquisitions of the remaining interests in Front Line and Vector partially offset by our acquisition of LN Ontario Concerts.

Concerts Results of Operations
Our Concerts segment operating results were, and discussions of significant variances are, as follows:

(in thousands)

Year Ended December 31,
2011

2012

2010

% Change
2012 vs. 2011

% Change
2011 vs. 2010

Revenue .............................................. $ 3,870,371
3,274,951
Direct operating expenses ...................
Selling, general and administrative

expenses .........................................
Depreciation and amortization ............
Gain on sale of operating assets..........
Acquisition transaction expenses ........
Operating loss ..................................... $

569,570
145,552
(453)
847
(120,096)

$ 3,506,188
2,946,410

$ 3,438,350
2,910,334

535,500
132,441
(880)
(2,286)
(104,997)

524,672
139,129
(4,848)
(2,424)
(128,513)

10%
11%

6%
10%
*
*
14%

2%
1%

2%
(5)%
*
*
(18)%

Operating margin ................................

(3.1)%

(3.0)%

(3.7)%

Adjusted operating income ** ............ $

31,364

30,275

15,366

97%

Percentages are not meaningful.

*
** AOI is a non-GAAP financial disclosure and is discussed in more detail and reconciled to operating income (loss) below.

Year Ended 2012 Compared to Year Ended 2011

Concerts revenue increased $364.2 million, or 10%, during the year ended December 31, 2012 as compared to the prior year
partially resulting from strategic priorities to grow owned and/or operated amphitheater and European festival profitability, expand our
portfolio of electronic dance music and other new festivals and expand into new geographic markets. Excluding the decrease of $80.2
million related to the impact of changes in foreign exchange rates, revenue increased $444.4 million, or 13%, partially due to
incremental revenue of $95.0 million resulting from acquisitions, primarily from the April 2012 acquisition of Coppel and the May
2012 acquisition of Cream. In addition, revenue increased due to current activity from global tours, more shows and higher per show
attendance at our North America owned and/or operated amphitheaters, third-party stadiums and theaters and clubs and increased
festival activity resulting from new events and higher attendance.

Concerts direct operating expenses increased $328.5 million, or 11%, during the year ended December 31, 2012 as compared to

the prior year. Excluding the decrease of $70.1 million related to the impact of changes in foreign exchange rates, direct operating
expenses increased $398.6 million, or 14%, partially due to incremental direct operating expenses of $91.7 million from acquisitions
as noted above. In addition, we incurred higher global touring costs and higher expenses associated with the increased number of
events and festival activity noted above. We also incurred $6.9 million higher advertising costs in 2012 for future events than we did
in the prior year.

Concerts selling, general and administrative expenses increased $34.1 million, or 6%, during the year ended December 31, 2012

as compared to the prior year. Excluding the decrease of $9.5 million related to the impact of changes in foreign exchange rates,
selling, general and administrative expenses increased $43.6 million, or 8%, resulting primarily from incremental costs of $6.9 million
from the acquisitions noted above and $12.4 million from expansion of our business in Asia and the opening of new venues, such as
Ziggo Dome in the Netherlands. We also had higher legal defense costs from various cases and increased compensation costs related
to improved performance and annual inflationary increases.

Concerts depreciation and amortization increased $13.1 million, or 10%, during the year ended December 31, 2012 as compared

to the prior year. Excluding the decrease of $1.1 million related to the impact of changes in foreign exchange rates, depreciation and
amortization increased $14.2 million, or 11%, primarily due to higher amortization associated with the impairment of intangible assets
for revenue-generating contracts and additional definite-lived intangible amortization expense associated with recent acquisitions.

Concerts acquisition expenses increased $3.1 million during the year ended December 31, 2012 as compared to the prior year
primarily due to costs associated with the acquisitions noted above partially offset by 2011 reductions in the fair value of acquisition-
related contingent consideration.

The increased operating loss for Concerts was primarily driven by higher costs incurred in 2012 for future events, increased
compensation costs and higher amortization partially offset by the timing of global tours and the improved results of our owned and/or
operated amphitheaters.

Year Ended 2011 Compared to Year Ended 2010

Concerts revenue increased $67.8 million, or 2%, during the year ended December 31, 2011 as compared to the prior year.
Excluding the increase of $99.4 million related to the impact of changes in foreign exchange rates, revenue decreased $31.6 million, or
1%, primarily due to a decrease in events and attendance from our planned show reduction in amphitheaters and reduced global
touring activity partially offset by increased shows and attendance in arenas and stadiums.

Concerts direct operating expenses increased $36.1 million, or 1%, during the year ended December 31, 2011 as compared to

the prior year. Excluding the increase of $87.1 million related to the impact of changes in foreign exchange rates, direct operating
expenses decreased $51.0 million, or 2%, primarily due to fewer amphitheater events and reduced global touring activity as noted
above and the impairment of certain artist advances in 2010 partially offset by higher expenses associated with increased arena and
stadium activity noted above and costs associated with investments in new festivals launched in 2011.

Concerts selling, general and administrative expenses increased $10.8 million, or 2%, during the year ended December 21, 2011

as compared to the prior year driven by an increase of $9.3 million related to the impact of changes in foreign exchange rates.

Concerts depreciation and amortization decreased $6.7 million, or 5%, during the year ended December 31, 2011 as compared
to the prior year. Excluding the increase of $1.2 million related to the impact of changes in foreign exchange rates, depreciation and
amortization decreased $7.9 million, or 6%, primarily due to an impairment charge of $31.2 million recorded in 2010 related to a club
and a contract intangible compared to an impairment charge in 2011 of $24.1 million for two amphitheaters, a music theater, a club
and contract intangibles.

Concerts gain on sale of operating assets was $0.9 million for the year ended December 31, 2011 as compared to $4.8 million
for the prior year. The 2010 gain was driven by a $4.3 million gain on the sale of a music theater in Sweden and the final settlement
received for the 2009 sale of a music theater in London.

The decreased operating loss for Concerts was primarily related to improved arena and stadium results and reduced artist costs

partially offset by investments in new festivals and reduced results in certain other festivals.

49
Ticketing Results of Operations

Our Ticketing segment operating results were, and discussions of significant variances are, as follows:

(in thousands)

Year Ended December 31,
2011

2012

2010

% Change
2012 vs. 2011

% Change
2011 vs. 2010

Revenue ................................................... $ 1,374,049
651,055
Direct operating expenses ........................
Selling, general and administrative

expenses ..............................................
Depreciation and amortization .................
Loss (gain) on sale of operating assets.....
Acquisition transaction expenses .............
Operating income..................................... $

434,310
165,947
(225)
153
122,809

$ 1,319,343
618,382

$ 1,089,340
513,311

428,364
158,071
(96)
1,314
113,308

362,416
139,007
5,186
780
68,640

4%
5%

1%
5%
*
*
8%

21%
20%

18%
14%
*
*
65%

Operating margin .....................................

8.9%

8.6%

6.3%

Adjusted operating income ** ................. $

294,625

279,045

234,053

19%

Percentages are not meaningful.

*
** AOI is a non-GAAP financial disclosure and is discussed in more detail and reconciled to operating income (loss) below.

Year Ended 2012 Compared to Year Ended 2011

Ticketing revenue increased $54.7 million, or 4%, during the year ended December 31, 2012 as compared to the prior year

partially resulting from strategic priorities such as focusing on strong client renewals supported by the launch of new products,
leveraging value-added client services and extending our mobile platforms, as well as growing our secondary, or resale, ticket sales.
Excluding the decrease of $14.8 million related to the impact of changes in foreign exchange rates, revenue increased $69.5 million, or
5%, primarily due to higher primary ticket sales for concert and sporting events and fees for the 2012 Olympics, increased resale
volume and $8.7 million in incremental revenue resulting from the acquisitions of TGLP in January 2011 and Serviticket in April
2011. These increases were partially offset by a reduction in primary and resale ticket sales associated with the National Hockey
League strike in 2012.

Ticketing direct operating expenses increased $32.7 million, or 5%, during the year ended December 31, 2012 as compared to

the prior year. Excluding the decrease of $6.3 million related to the impact of changes in foreign exchange rates, direct operating
expenses increased $39.0 million, or 6%, primarily due to additional costs associated with the increase in ticket sales noted above and
incremental direct operating expenses of $3.8 million resulting from the acquisitions noted above.

Ticketing selling, general and administrative expenses increased $5.9 million, or 1%, during the year ended December 31, 2012

as compared to the prior year. Excluding the decrease of $5.4 million related to the impact of changes in foreign exchange rates,
selling, general and administrative expenses increased $11.3 million, or 3%, primarily due to increased headcount and other expenses
associated with the investment in our technology platform and incremental costs of $7.2 million related to the acquisitions noted above
and BigChampagne in December 2011. These increases were partially offset by an accrual in the third quarter of 2011 related to a
legal settlement.

Ticketing depreciation and amortization increased $7.9 million, or 5%, during the year ended December 31, 2012 as compared
to the prior year. Excluding the decrease of $1.3 million related to the impact of changes in foreign exchange rates, depreciation and
amortization increased $9.2 million, or 6%, primarily due to increased amortization related to non-recoupable venue contract advances
and higher depreciation from our investment in our technology platform.

The increase in operating income for Ticketing was primarily due to improved primary ticket sales and resale volume partially

offset by costs associated with our investment to enhance our ticketing platform.

Year Ended 2011 Compared to Year Ended 2010

Ticketing revenue increased $230.0 million, or 21%, during the year ended December 31, 2011 as compared to the prior year.
Excluding the increase of $25.1 million related to the impact of changes in foreign exchange rates, revenue increased $204.9 million,
or 19%, primarily due to incremental revenue of $137.4 million resulting from the timing of our Merger and the acquisitions of
Ticketnet, TGLP and Serviticket. In addition, we had increased upsell revenue and ticket sales internationally, primarily in Germany,
Australia, Turkey and Sweden, fees related to ticketing services for the 2012 London Olympics, higher resale volume and the
transition of the artist-related online business from the Artist Nation segment in 2011. Partially offsetting these increases was a
reduction in fees due to the full year impact of the change to the contract with AEG, which was a requirement of the DOJ approval of
the Merger, and a reduction of $3.7 million relating to our divestiture of Paciolan in 2010.

Ticketing direct operating expenses increased $105.1 million, or 20%, during the year ended December 31, 2011 as compared to

the prior year. Excluding the increase of $12.1 million related to the impact of changes in foreign exchange rates, direct operating
expenses increased $93.0 million, or 18%, primarily due to incremental direct operating expenses of $62.0 million resulting from the
timing of our Merger and the acquisitions noted above. We also had increased costs associated with the higher ticket sales
internationally and the transition of the artist-related online business noted above, partially offset by lower domestic direct costs and a
reduction of $1.7 million relating to our Paciolan divestiture.

Ticketing selling, general and administrative expenses increased $65.9 million, or 18%, during the year ended December 31,

2011 as compared to the prior year. Excluding the increase of $7.7 million related to the impact of changes in foreign exchange rates,
selling, general and administrative expenses increased $58.2 million, or 16%, primarily due to incremental expenses of $39.9 million
resulting from the timing of our Merger and the acquisitions noted above. We also increased operating costs related to our technology
platform as we began the first year of development during 2011 and also transitioned the artist-related online business as noted above.
Partially offsetting these increases were lower litigation settlement accruals and a reduction of $1.1 million relating to our Paciolan
divestiture.

Ticketing depreciation and amortization increased $19.1 million, or 14%, during the year ended December 31, 2011 as
compared to the prior year. Excluding the increase of $2.2 million related to the impact of changes in foreign exchange rates,
depreciation and amortization increased $16.9 million, or 12%, primarily due to incremental depreciation and amortization of $11.6
million resulting from the timing of our Merger and the acquisitions noted above along with increased amortization resulting from the
addition of technology definite-lived intangible assets from our Merger.

Ticketing gain on sale of operating assets was $0.1 million for the year ended December 31, 2011 as compared to a loss on sale

of operating assets of $5.2 million for the prior year primarily due to the sale of Paciolan in March 2010.

The increase in operating income for Ticketing was primarily due to the impact from the Merger and other acquisitions, higher

ticket sales, upsell revenue and earnings from the 2012 Olympics, partially offset by investments in our technology platform.

Artist Nation Results of Operations

Our Artist Nation segment operating results were, and discussions of significant variances are, as follows:

Year Ended December 31,
2011

2012

2010

% Change

% Change
2012 vs. 2011

2011 vs. 2010

(in thousands)

Revenue ....................................................... $ 399,940
263,896
Direct operating expenses ............................
Selling, general and administrative

expenses ..................................................
Depreciation and amortization .....................
Loss (gain) on sale of operating assets.........
Acquisition transaction expenses .................
Operating loss .............................................. $

99,786
115,696
(42)
1,163
(80,559)

$ 393,129
260,884

$ 362,159
233,016

113,199
50,412
1,264
(7,758)
(24,872)

93,995
41,520
20
6,277
(12,669)

2%
1%

(12)%
*
*
*
*

9%
12%

20%
21%
*
*
96%

Operating margin .........................................

(20.1)%

(6.3)%

(3.5)%

Adjusted operating income ** ..................... $

38,134

47,178

46,553

(19)%

Percentages are not meaningful.

*
** AOI is a non-GAAP financial disclosure and is discussed in more detail and reconciled to operating income (loss) below.

Year Ended 2012 Compared to Year Ended 2011

Artist Nation revenue increased $6.8 million, or 2%, during the year ended December 31, 2012 as compared to the prior year.
Excluding the decrease of $0.3 million related to the impact of changes in foreign exchange rates, revenue increased $7.1 million, or
2%, primarily due to increased sales of premium ticket packages and incremental revenue of $9.5 million resulting from the
acquisition of T-Shirt Printers in October 2011. These increases were partially offset by reduced tour merchandise sales and the
transition of the online fan club activity to the Ticketing segment in 2011.

Artist Nation direct operating expenses increased $3.0 million, or 1%, during the year ended December 31, 2012 as compared to

the prior year. Excluding the decrease of $0.4 million related to the impact of changes in foreign exchange rates, direct operating
expenses increased $3.4 million, or 1%, primarily due to increased cost for premium ticket packages and incremental direct operating
expenses of $8.4 million resulting from the acquisition noted above. These increases were partially offset by lower costs for tour
merchandise due to reduced sales and the transition of the online fan club activity noted above.

Artist Nation selling, general and administrative expenses decreased $13.4 million, or 12%, during the year ended December 31,
2012 as compared to the prior year primarily due to $24.4 million of stock-based compensation expense recorded in the first quarter of
2011 related to the acquisition of the remaining interests in Front Line partially offset by incremental costs related to Irving Azoff
leaving of $5.5 million and $1.9 million resulting from the acquisition above along with higher compensation-related costs related to
the management business.

Artist Nation depreciation and amortization increased $65.3 million, or 130%, during the year ended December 31, 2012 as

compared to the prior year primarily due to an impairment charge of $62.7 million related to certain client/vendor relationship
intangibles in the management business based on current expectations related to future cash flows on this business.

Artist Nation loss on sale of operating assets decreased $1.3 million during the year ended December 31, 2012 as compared to

the prior year primarily due to the sale of an artist management company in January 2011.

Artist Nation acquisition transaction expenses increased $10.0 million for the year ended December 31, 2012 as compared to the

prior year primarily due to reductions in 2011 in the fair value of acquisition-related contingent consideration.

The increased operating loss for Artist Nation was driven by the impairment of certain client/vendor relationship intangibles in

2012 partially offset by lower stock-based compensation expense from the 2011 acquisitions of the remainder of Front Line.

Year Ended 2011 Compared to Year Ended 2010

Artist Nation revenue increased $31.0 million, or 9%, during the year ended December 31, 2011 as compared to the prior year.
Excluding the increase of $2.1 million related to the impact of changes in foreign exchange rates, revenue increased $28.9 million, or
8%, primarily due to incremental revenue of $20.4 million resulting from the timing of our Merger, the 2011 acquisition of T-Shirt
Printers and the 2010 acquisition of Sports Marketing and Entertainment, Inc. In addition, we generated higher management
commissions and increased sales of premium ticket packages and merchandise.

Artist Nation direct operating expenses increased $27.9 million, or 12%, during the year ended December 31, 2011 as compared

to the prior year. Excluding the increase of $2.0 million related to the impact of changes in foreign exchange rates, direct operating
expenses increased $25.9 million, or 11%, primarily due to incremental direct operating expenses of $16.0 million resulting from the
timing of our Merger and the acquisitions noted above as well as higher costs associated with premium ticket packages and
merchandise sales.

Artist Nation selling, general and administrative expenses increased $19.2 million, or 20%, during the year ended December 31,
2011 as compared to the prior year primarily due to incremental stock-based compensation expense of $24.4 million related to the first
quarter 2011 acquisition of the remaining interests in Front Line along with incremental selling, general and administrative expenses
of $5.2 million resulting from the timing of our Merger and the acquisitions noted above. Partially offsetting these increases were
declines in selling, general and administrative expenses resulting from the transition of the artist-related online businesses to
Ticketing.

Artist Nation depreciation and amortization increased $8.9 million, or 21%, during the year ended December 31, 2011 as
compared to the prior year primarily due to incremental amortization of definite-lived intangible assets resulting from our Merger and
other acquisitions and the acceleration of amortization for a trade name being phased out.

Artist Nation loss on sale of operating assets of $1.3 million during the year ended December 31, 2011 is primarily due to the

sale of an artist management company in January 2011.

Artist Nation acquisition transaction expenses decreased by $14.0 million for the year ended December 31, 2011 as compared to
the prior year primarily due to decreases in the fair values of acquisition-related contingent consideration in 2011 relating to the timing
of key artists tours as compared to 2010 increases in the fair value of acquisition-related contingent consideration relating to improved
projections for several artist management businesses.

The increased operating loss for Artist Nation was driven by incremental stock-based compensation expense related to the

acquisition of the remaining interests in Front Line.

Sponsorship & Advertising Results of Operations

Our Sponsorship & Advertising segment operating results were, and discussions of significant variances are, as follows:

Year Ended December 31,
2011

2012

2010

% Change
2012 vs. 2011

% Change
2011 vs. 2010

(in thousands)

Revenue ............................................................. $ 247,921
34,738
Direct operating expenses ..................................
38,198
Selling, general and administrative expenses.....
1,187
Depreciation and amortization ...........................
-
Loss on sale of operating assets .........................
Operating income............................................... $ 173,798

$ 230,791
33,682
32,787
483
-
$ 163,839

$ 200,146
28,512
30,707
255
6
$ 140,666

7%
3%
17%
*
*
6%

15%
18%
7%
89%
*
16%

Operating margin ...............................................

70.1%

71.0%

70.3%

Adjusted operating income ** ........................... $ 175,619

$ 165,081

$ 141,537

17%

Percentages are not meaningful.

*
** AOI is a non-GAAP financial disclosure and is discussed in more detail and reconciled to operating income (loss) below.

Year Ended 2012 Compared to Year Ended 2011

Sponsorship & Advertising revenue increased $17.1 million, or 7%, during the year ended December 31, 2012 as compared to

the prior year. Excluding the decrease of $5.0 million related to the impact of changes in foreign exchange rates, revenue increased
$22.1 million, or 10%, resulting primarily from expansion of existing and new sponsorship agreements, online advertising growth and
higher festival sponsorships driven by increased international festival activity.

Sponsorship & Advertising direct operating expense increased $1.1 million, or 3%, during the year ended December 31, 2012 as

compared to the prior year. Excluding the decrease of $0.6 million related to the impact of changes in foreign exchange rates, direct
operating expenses increased $1.7 million, or 5%, primarily driven by higher costs associated with the increase in revenue.

Sponsorship & Advertising selling, general and administrative expenses increased $5.4 million, or 17%, during the year ended
December 31, 2012 as compared to the prior year. Excluding the decrease of $0.2 million related to the impact of changes in foreign
exchange rates, selling, general and administrative expenses increased $5.6 million, or 17%, primarily related to increased headcount
and compensation costs to drive higher digital and sponsorship sales.

The increased operating income was primarily due to higher sponsorship and online advertising activity, including increased

international festival sponsorships, partially offset by increased headcount expenses to sell and manage the higher revenue.

Year Ended 2011 Compared to Year Ended 2010

Sponsorship & Advertising revenue increased $30.6 million, or 15%, during the year ended December 31, 2011 as compared to

the prior year. Excluding the increase of $4.9 million related to the impact of changes in foreign exchange rates, revenue increased
$25.7 million, or 13%, primarily due to new sponsorship relationships, renewal or expansion of existing arrangements, increased
online advertising and expansion of our sponsorship operations to additional countries.

Sponsorship & Advertising direct operating expense increased $5.2 million, or 18%, during the year ended December 31, 2011
as compared to the prior year. Excluding the increase of $1.0 million related to the impact of changes in foreign exchange rates, direct
operating expenses increased $4.2 million, or 15%, primarily driven by higher fulfillment costs related to the increased revenue.

The increased operating income was primarily due to new sponsor and advertising relationships and higher international festival

sponsorships.

Reconciliation of Segment Adjusted Operating Income (Loss)

AOI is a non-GAAP financial measure that we define as operating income (loss) before acquisition expenses (including
transaction costs, changes in the fair value of accrued acquisition-related contingent consideration arrangements, Merger bonuses,
payments under the Azoff Trust note and acquisition-related severance), depreciation and amortization (including goodwill
impairment), loss (gain) on sale of operating assets and non-cash and certain stock-based compensation expense (including expense
associated with grants of certain stock-based awards which were classified as liabilities). We use AOI to evaluate the performance of
our operating segments. We believe that information about AOI assists investors by allowing them to evaluate changes in the
operating results of our portfolio of businesses separate from non-operational factors that affect net income, thus providing insights
into both operations and the other factors that affect reported results. AOI is not calculated or presented in accordance with GAAP. A
limitation of the use of AOI as a performance measure is that it does not reflect the periodic costs of certain amortizing assets used in
generating revenue in our business. Accordingly, AOI should be considered in addition to, and not as a substitute for, operating
income (loss), net income (loss), and other measures of financial performance reported in accordance with GAAP. Furthermore, this
measure may vary among other companies; thus, AOI as presented herein may not be comparable to similarly titled measures of other
companies.

The following table sets forth the computation of adjusted operating income (loss):

Adjusted
operating
income (loss)

Non-cash
and stock-
based
compensation
expense

2012
Concerts ......................... $
Ticketing ........................
Artist Nation ..................
Sponsorship &

Advertising................
Other and Eliminations ..
Corporate .......................
Total............................... $

2011
Concerts ......................... $
Ticketing ........................
Artist Nation ..................
Sponsorship &

Advertising................
Other and Eliminations ..
Corporate .......................
Total............................... $

2010
Concerts ......................... $
Ticketing ........................
Artist Nation ..................
Sponsorship &

Advertising................
Other and Eliminations ..
Corporate .......................
Total............................... $

31,364 $
294,625
38,134

175,619
(1,639)
(78,965)
459,138 $

30,275 $
279,045
47,178

165,081
2,298

(85,972)
437,905 $

15,366 $
234,053
46,553

141,537
(250)
(74,444)
362,815 $

Loss (gain)
on sale of
operating
assets

Depreciation
and
amortization

(in thousands)

Acquisition
expenses

Operating
income (loss)

5,514 $
6,273
1,876

634
-

22,766
37,063 $

5,995 $
5,607
28,132

763
-

20,148
60,645 $

11,603 $
12,241
10,205

459
-

27,099
61,607 $

(453) $
(225)
(42)

-
206
-
(514) $

(880) $
(96)
1,264

-
689
1
978 $

(4,848) $
5,186
20

6
6
4
374 $

145,552 $
165,947
115,696

1,187
(1,654)
2,829
429,557 $

132,441 $
158,071
50,412

483
(855)
2,466
343,018 $

139,129 $
139,007
41,520

255
(511)
2,266
321,666 $

847 $
(179)
1,163

-
-
12,840
14,671 $

(2,284) $
2,155
(7,758)

(4)
-
22,818
14,927 $

(2,005) $
8,979
7,477

151
-
28,266
42,868 $

(120,096)
122,809
(80,559)

173,798
(191)
(117,400)
(21,639)

(104,997)
113,308
(24,872)

163,839
2,464
(131,405)
18,337

(128,513)
68,640
(12,669)

140,666
255
(132,079)
(63,700)

Liquidity and Capital Resources

Our working capital requirements and capital for our general corporate purposes, including acquisitions and capital

expenditures, are funded from operations or from borrowings under our senior secured credit facility described below. Our cash is
centrally managed on a worldwide basis. Our primary short-term liquidity needs are to fund general working capital requirements,
capital expenditures and debt service requirements while our long-term liquidity needs are primarily related to acquisitions and debt
repayment. Our primary sources of funds for our short-term liquidity needs will be cash flows from operations and borrowings under
our senior secured credit facility, while our long-term sources of funds will be from cash flows from operations, long-term bank
borrowings and other debt or equity financing.

Our balance sheets reflect cash and cash equivalents of $1.0 billion at December 31, 2012 and $844.3 million at December 31,

2011. Included in the December 31, 2012 and 2011 cash and cash equivalents balance is $441.6 million and $373.9 million,
respectively, of funds representing amounts equal to the face value of tickets sold on behalf of clients and the clients’ share of
convenience and order processing charges, or client funds. We do not utilize client funds for our own financing or investing activities
as the amounts are payable to clients. Our foreign subsidiaries hold approximately $473.5 million in cash and cash equivalents,
excluding client cash. We do not intend to repatriate these funds, but would need to accrue and pay United States federal and state
income taxes on any future repatriations, net of applicable foreign tax credits. We may from time to time enter into borrowings under
our revolving credit facility. If the original maturity of these borrowings is ninety days or less, we present the borrowings and
subsequent repayments on a net basis on the statement of cash flows to better represent our financing activities. Our balance sheets
reflect current and long-term debt of $1.7 billion at December 31, 2012 and $1.7 billion at December 31, 2011. Our weighted-average
cost of debt, excluding the debt discounts on our term loan and convertible notes, was 5.2% at December 31, 2012.

Our cash and cash equivalents are held in accounts managed by third-party financial institutions and consist of cash in our

operating accounts and invested cash. Cash held in interest-bearing operating accounts in many cases exceeds the Federal Deposit
Insurance corporation insurance limits. The invested cash is in interest-bearing funds consisting primarily of bank deposits and money
market funds. While we monitor cash and cash equivalent balances in our operating accounts on a regular basis and adjust the
balances as appropriate, these balances could be impacted if the underlying financial institutions fail. To date, we have experienced no
loss or lack of access to our cash and cash equivalents; however, we can provide no assurances that access to our cash and cash
equivalents will not be impacted by adverse conditions in the financial markets.

For our Concerts segment, we generally receive cash related to ticket revenue at our owned and/or operated venues in advance

of the event, which is recorded in deferred revenue until the event occurs. With the exception of some upfront costs and artist deposits,
which are recorded in prepaid expenses until the event occurs, we pay the majority of event-related expenses at or after the event.

We view our available cash as cash and cash equivalents, less ticketing-related client funds, less event-related deferred revenue,

less accrued expenses due to artists and for cash collected on behalf of others for ticket sales, plus event-related prepaids. This is
essentially our cash available to, among other things, repay debt balances, make acquisitions and finance capital expenditures.

Our intra-year cash fluctuations are impacted by the seasonality of our various businesses. Examples of seasonal effects include
our Concerts and Artist Nation segments, which report the majority of their revenue in the second and third quarters. Cash inflows and
outflows depend on the timing of event-related payments but the majority of the inflows generally occur prior to the event. See “—
Seasonality” below. We believe that we have sufficient financial flexibility to fund these fluctuations and to access the global capital
markets on satisfactory terms and in adequate amounts, although there can be no assurance that this will be the case, and capital could
be less accessible and/or more costly given current economic conditions. We expect cash flow from operations and borrowings under
our senior secured credit facility, along with other financing alternatives, to satisfy working capital, capital expenditures and debt
service requirements for at least the succeeding year.

We may need to incur additional debt or issue equity to make other strategic acquisitions or investments. There can be no
assurance that such financing will be available to us on acceptable terms or at all. We may make significant acquisitions in the near
term, subject to limitations imposed by our financing documents and market conditions.

The lenders under our revolving loans and counterparties to our interest rate hedge agreements consist of banks and other third-
party financial institutions. While we currently have no indications or expectations that such lenders and counterparties will be unable
to fund their commitments as required, we can provide no assurances that future funding availability will not be impacted by adverse
conditions in the financial markets. Should an individual lender default on its obligations, the remaining lenders would not be required
to fund the shortfall, resulting in a reduction in the total amount available to us for future borrowings, but would remain obligated to
fund their own commitments. Should any counterparty to our interest rate hedge agreements default on its obligations, we could
experience higher interest rate volatility during the period of any such default.

55
Sources of Cash

Liberty Media Subscription Agreement

In February 2011, we entered into a subscription agreement with Liberty Media. Pursuant to the subscription agreement, in
February and June 2011, we sold to Liberty Media 1.8 million and 5.5 million shares, respectively, of our common stock for cash
consideration of $18.8 million and $57.7 million, respectively.

May 2010 Senior Secured Credit Facility

In August 2012, we exercised a right, under the terms of our senior secured credit facility, to increase the term loan B

borrowings by $100 million and entered into an Incremental Term Loan Joinder Agreement.

At December 31, 2012 our senior secured credit facility consists of (i) a $100 million term loan A with a maturity of five and

one-half years, (ii) a $900 million term loan B with a maturity of six and one-half years and (iii) a $300 million revolving credit
facility with a maturity of five years. In addition, subject to certain conditions, we have the right to increase such term loan facilities
by up to $200 million in the aggregate. The five-year revolving credit facility provides for borrowings up to the amount of the facility
with sublimits of up to (i) $150 million to be available for the issuance of letters of credit, (ii) $50 million to be available for swingline
loans and (iii) $100 million to be available for borrowings in foreign currencies. The senior secured credit facility is secured by a first
priority lien on substantially all of our domestic wholly-owned subsidiaries and on 65% of the capital stock of our wholly-owned
foreign subsidiaries.

The interest rates per annum applicable to loans under the senior secured credit facility are, at our option, equal to either LIBOR
plus 3.25% or a base rate plus 2.25%, subject to stepdowns based on our leverage ratio. The interest rate for the term loan B is subject
to a LIBOR floor of 1.5% and a base rate floor of 2.5%. We are required to pay a commitment fee of 0.5% per year on the undrawn
portion available under the revolving credit facility and variable fees on outstanding letters of credit.

For the term loan A, we are required to make quarterly payments ranging from $1.25 million to $10 million with the balance due
at maturity in November 2015. For the term loan B, we are required to make quarterly payments of $2.25 million with the balance due
at maturity in November 2016. We are also required to make mandatory prepayments of the loans under the credit agreement, subject
to specified exceptions, from excess cash flow, and with the proceeds of asset sales, debt issuances and specified other events.

On June 29, 2012, we entered into Amendment No. 1 to our senior secured credit agreement to, among other things, (i) modify

the definition of Consolidated EBITDA to increase our allowance for restructuring, nonrecurring or other unusual loss or expense,
(ii) modify the Consolidated Total Leverage Ratio and (iii) modify the definition of Applicable Percentage for purposes of Revolving
Loans, Swingline Loans, B/A Drawings, Letter of Credit Fees, Term A Loans and Term B Loans (as defined in the credit agreement)
in the event that our Consolidated Total Leverage Ratio equals or exceeds 4.0x.

During the year ended December 31, 2012, we made principal payments totaling $18.5 million on these term loans. At

December 31, 2012, the outstanding balances on the term loans, net of discount were $939.9 million. There were no borrowings under
the revolving credit facility as of December 31, 2012. Based on our letters of credit of $63.9 million, $236.1 million was available for
future borrowings.

7% Senior Notes

In August 2012, we issued $225 million of 7% senior notes due 2020. Interest on the notes is payable semi-annually in cash in
arrears on March 1 and September 1 of each year, beginning on March 1, 2013, and the notes will mature on September 1, 2020. We
may redeem some or all of the notes at any time prior to September 1, 2016 at a price equal to 100% of the aggregate principal
amount, plus any accrued and unpaid interest to the date of redemption, plus a ‘make-whole’ premium using a discount rate equal to
the Treasury Rate plus 50 basis points. We may also redeem up to 35% of the notes from the proceeds of certain equity offerings prior
to September 1, 2015, at a price equal to 107% of the principal amount, plus any accrued and unpaid interest. In addition, on or after
September 1, 2016, we may redeem at our option some or all of the notes at redemption prices that start at 103.5% of their principal
amount, plus any accrued and unpaid interest to the date of redemption. We must make an offer to redeem the notes at 101% of the
aggregate principal amount, plus accrued and unpaid interest to the repurchase date, if we experience certain defined changes of
control. At December 31, 2012, the outstanding balance on the 7% senior notes was $225.0 million.

Borrowings under the 7% senior notes, along with the $100 million incremental term loan B, were primarily used to repay

borrowings under the 10.75% senior notes, pay related fees and expenses and for general corporate purposes.

8.125% Senior Notes

In May 2010, we issued $250 million of 8.125% senior notes due 2018. Interest on the notes is payable semi-annually in cash in
arrears on May 15 and November 15 of each year, beginning on November 15, 2010, and the notes will mature on May 15, 2018. We
may redeem some or all of the notes at any time prior to May 15, 2014 at a price equal to 100% of the principal amount, plus any
accrued and unpaid interest to the date of redemption, plus a ‘make-whole’ premium using a discount rate equal to the Treasury Rate
plus 50 basis points. We may also redeem up to 35% of the notes from the proceeds of certain equity offerings prior to May 15, 2013,
at a price equal to 108.125% of the principal amount, plus any accrued and unpaid interest. In addition, on or after May 15, 2014, we

56
may redeem some or all of the notes at any time at redemption prices that start at 104.063% of the principal amount. We must also
offer to redeem the notes at 101% of the aggregate principal amount, plus accrued and unpaid interest to the repurchase date, if we
experience certain kinds of changes of control. Borrowings on the 8.125% senior notes were primarily used to partially repay the
borrowings under our and Ticketmaster’s then existing credit facilities. At December 31, 2012, the outstanding balance on the 8.125%
senior notes was $250.0 million.

Other Debt

In June 2012, we entered into an additional debt agreement, where we borrowed $34.2 million of floating rate debt, primarily to

fund our operations in Australia.

Debt Covenants

Our senior secured credit facility contains a number of covenants and restrictions that, among other things, require us to satisfy

certain financial covenants and restrict our and our subsidiaries’ ability to incur additional debt, make certain investments and
acquisitions, repurchase our stock and prepay certain indebtedness, create liens, enter into agreements with affiliates, modify the
nature of our business, enter into sale-leaseback transactions, transfer and sell material assets, merge or consolidate, and pay dividends
and make distributions (with the exception of subsidiary dividends or distributions to the parent company or other subsidiaries on at
least a pro-rata basis with any noncontrolling interest partners). Non-compliance with one or more of the covenants and restrictions
could result in the full or partial principal balance of the credit facility becoming immediately due and payable. The senior secured
credit facility agreement has two covenants measured quarterly that relate to total leverage and interest coverage. The consolidated
total leverage covenant requires us to maintain a ratio of consolidated total debt to consolidated EBITDA (both as defined in the credit
agreement) of 4.5x over the trailing four consecutive quarters through December 2013. The total leverage ratio will reduce to 4.25x on
March 31, 2014, 4.0x on March 31, 2015 and 3.75x on March 31, 2016. The consolidated interest coverage covenant requires us to
maintain a minimum ratio of consolidated EBITDA to consolidated interest expense (both as defined in the credit agreement) of 3.0x
over the trailing four consecutive quarters.

The indentures governing our 7% senior notes and the 8.125% senior notes contain covenants that limit, among other things, our

ability and the ability of our restricted subsidiaries to incur certain additional indebtedness and issue preferred stock; make certain
distributions, investments and other restricted payments; sell certain assets; agree to any restrictions on the ability of restricted
subsidiaries to make payments to us; merge, consolidate or sell all of our assets; create certain liens; and engage in transactions with
affiliates on terms that are not arm’s length. Certain covenants, including those pertaining to incurrence of indebtedness, restricted
payments, asset sales, mergers and transactions with affiliates will be suspended during any period in which the notes are rated
investment grade by both rating agencies and no default or event of default under the indentures has occurred and is continuing. The
7% senior notes and the 8.125% senior notes each contain two incurrence-based financial covenants, as defined, requiring a minimum
fixed charge coverage ratio of 2.0 to 1.0 and a maximum secured indebtedness leverage ratio of 2.75 to 1.0.

Some of our other subsidiary indebtedness includes restrictions on entering into various transactions, such as acquisitions and

disposals, and prohibits payment of ordinary dividends. They also have financial covenants including minimum consolidated EBITDA
to consolidated net interest payable, minimum consolidated cash flow to consolidated debt service and maximum consolidated debt to
consolidated EBITDA, all as defined in the applicable debt agreements.

As of December 31, 2012, we believe we were in compliance with all of our debt covenants. We expect to remain in compliance

with all of our debt covenants throughout 2013.

Disposal of Assets

During the year ended December 31, 2012, we received $8.3 million of proceeds primarily related to the sale of an amphitheater

in Ohio. During the year ended December 31, 2011, we received $7.4 million of proceeds primarily related to the sale of an
amphitheater in Texas and a payment received in the first quarter of 2011 relating to the 2010 sale of a music theater in Sweden.
During the year ended December 31, 2010, we received $35.8 million of proceeds primarily related to the sale of Paciolan and a music
theater in Sweden.

Uses of Cash

Acquisitions

When we make acquisitions, the acquired entity may have cash on its balance sheet at the time of acquisition. All amounts
discussed in this section are presented net of any cash acquired. During 2012, we used $75.6 million in cash primarily for acquisitions
in our Concerts segment of Coppel in April 2012 and Cream in May 2012.

57
During 2011, we used $39.5 million in cash primarily for the acquisitions in our Artist Nation segment of interests in four artist

management companies in the United Kingdom and the United States, the April 2011 acquisition in our Ticketing segment of
Serviticket and the December 2011 acquisition of BigChampagne, the October 2011 acquisition in our Artist Nation segment of T-
Shirt Printers and the December 2011 acquisition in our Concerts segment of LN-HS Concerts.

During 2010, our cash increased by $491.5 million from acquisitions in our Concerts, Ticketing, Artist Nation and Sponsorship
& Advertising segments, primarily related to Ticketmaster cash on hand at the time of the Merger partially offset by our acquisition of
Ticketnet, a ticketing company in France.

Purchases of Intangibles

In 2012, we used $14.6 million in cash primarily related to the acquisition of the rights to a festival in Europe.

In 2011 and 2010, we used $2.6 million and $1.8 million, respectively, in cash primarily related to a naming rights agreement

for a festival in Europe.

Capital Expenditures

Venue and ticketing operations are capital intensive businesses, requiring continual investment in our existing venues and

ticketing system to address audience and artist expectations, technological industry advances and various federal, state and/or local
regulations.

We categorize capital outlays between maintenance capital expenditures and revenue generating capital expenditures.

Maintenance capital expenditures are associated with the renewal and improvement of existing venues and technology systems, web
development and administrative offices. Revenue generating capital expenditures generally relate to the construction of new venues or
major renovations to existing buildings or buildings that are being added to our venue network or the development of new online or
ticketing tools or technology enhancements. Revenue generating capital expenditures can also include smaller projects whose purpose
is to add revenue and/or improve operating income. Capital expenditures typically increase during periods when venues are not in
operation since that is the time that such improvements can be completed.

Our capital expenditures, including accruals but excluding expenditures funded by outside parties such as landlords or

replacements funded by insurance companies, consisted of the following:

2012

Year Ended December 31,
2011
(in thousands)

2010

Maintenance capital

expenditures........................ $

Revenue generating capital

expenditures........................
Total capital expenditures........ $

62,962

60,255
123,217

64,351

47,471

47,693
112,044

26,367
73,838

Maintenance capital expenditures for 2012 decreased from the prior year primarily due to a reduction in venue-related projects

and office renovations or relocations.

Revenue generating capital expenditures for 2012 increased from the prior year primarily related to our investment in

technology and renovation and development of various venues.

Maintenance capital expenditures for 2011 increased from the prior year primarily due to expenditures relating to the integration

of our financial systems and offices as a result of the Merger along with higher maintenance expenditures related to venues, ticketing
technology and client ticketing equipment.

Revenue generating capital expenditures for 2011 increased from the prior year primarily related to the re-platforming of our

ticketing system and website enhancements.

We currently expect capital expenditures to be approximately $120.0 million for the year ending December 31, 2013.

Contractual Obligations and Commitments

Firm Commitments

In addition to the scheduled maturities on our debt, we have future cash obligations under various types of contracts. We lease
office space, certain equipment and many of the venues used in our concert operations under long-term operating leases. Some of our
lease agreements contain renewal options and annual rental escalation clauses (generally tied to the consumer price index), as well as
provisions for our payment of utilities and maintenance. We also have minimum payments associated with non-cancelable contracts
related to our operations such as artist guarantee contracts. As part of our ongoing capital projects, we will enter into construction-
related commitments for future capital expenditure work. The scheduled maturities discussed below represent contractual obligations
as of December 31, 2012 and thus do not represent all expected expenditures for those periods.

The scheduled maturities of our outstanding long-term debt, future minimum rental commitments under non-cancelable lease

agreements, minimum payments under other non-cancelable contracts and capital expenditure commitments as of December 31, 2012
are as follows:

Payments Due by Period

Total

2013

2014-2015
(in thousands)

2016-2017

2018 and
thereafter

Long-term debt obligations, including current

maturities:

Term loans and revolving credit facility............... $
7% senior notes ....................................................
8.125% senior notes .............................................
2.875% convertible senior notes (1) .....................
Other long-term debt ............................................

955,000 $
225,000
250,000
220,000
125,660

Estimated interest payments (2).....................................
Non-cancelable operating leases (3) ..............................
Non-cancelable contracts (3) .........................................
Capital expenditures.......................................................
Contingent consideration ...............................................

424,854
1,964,796
1,123,025
3,575
6,718

22,750 $

81,750 $

850,500 $

-
-
-
39,300

92,245
118,892
728,504
3,225
2,538

-
-
220,000
42,268

166,182
223,994
256,407
50
4,180

-
-
-
26,180

108,249
205,933
118,485
50
-

-
225,000
250,000
-
17,912

58,178
1,415,977
19,629
250
-

Total............................................................................... $ 5,298,628 $ 1,007,454 $

994,831 $ 1,309,397 $ 1,986,946

(1)

(2)

July 15, 2014 represents the earliest redemption date for the holders of the 2.875% convertible senior notes.
Includes interest on the 2.875% convertible senior notes through July 2014. Does not include interest on the revolving credit
facility as the balance was zero as of December 31, 2012.

(3) Commitment amounts for non-cancelable operating leases and non-cancelable contracts which stipulate an increase in the

commitment amount based on an inflationary index have been estimated using an inflation factor of 2.5% for North America,
3.1% for the United Kingdom and 2.1% for the Netherlands.

During 2006, in connection with our acquisition of the Historic Theatre Group, we guaranteed obligations related to a lease

agreement. In the event of default, we could be liable for obligations which have future lease payments (undiscounted) of
approximately $23.1 million through the end of 2035 which are not reflected in the table above. The scheduled future minimum
rentals for this lease for the years 2013 through 2017 are $1.6 million each year. The venues under the lease agreement were included
in the sale of our North American theatrical business. The buyer assumed our obligations under the guaranty, however we remain
contingently liable to the lessor. We believe that the likelihood of a material liability being triggered under this lease is remote, and no
liability has been accrued for these contingent lease obligations as of December 31, 2012.

Aggregate minimum rentals of $87.3 million to be received in years 2013 through 2020 under non-cancelable subleases are

excluded from the commitment amounts in the above table.

Guarantees of Third-Party Obligations

As of December 31, 2012 and 2011, we guaranteed the debt of third parties of approximately $12.7 million and $13.1 million

for each of the respective periods, primarily related to maximum credit limits on employee and tour-related credit cards and
obligations under a venue management agreement.

Cash Flows

Cash provided by (used in):

Operating activities ............... $
Investing activities ................ $
Financing activities ............... $

Operating Activities

Year Ended 2012 Compared to Year Ended 2011

2012

Year Ended December 31,
2011
(in thousands)

2010

367,098
(203,791)
(19,891)

$
$
$

135,705
(152,017)
(44,379)

$
$
$

158,518
452,987
49,086

Cash provided by operating activities was $367.1 million for the year ended December 31, 2012, compared to $135.7 million for

the year ended December 31, 2011. The $231.4 million increase in cash provided by operating activities resulted primarily from net
changes in the event-related operating accounts which are dependent on the timing of ticket sales along with the size and number of
events for upcoming periods. During 2012, we sold more tickets for future events than we did in 2011 which increased deferred
revenue, partially offset by higher payments of prepaid event-related expenses for those future events. In addition, we collected more
accounts receivable, had lower long-term artist-related payments and paid less accrued event-related expenses as compared to the
same period in the prior year. Also contributing to the increase in cash provided by operating activities was $22.2 million in payments
made in 2011 related to the acquisition of certain remaining equity interests in Front Line that were classified as liabilities.

Year Ended 2011 Compared to Year Ended 2010

Cash provided by operating activities was $135.7 million for the year ended December 31, 2011, compared to $158.5 million for
the year ended December 31, 2010. The $22.8 million decrease in cash provided by operating activities resulted primarily from the net
changes in the operating balance sheet accounts largely offset by the increase in the cash-related portion of net income. In 2011, we
received less deferred revenue and increased accounts receivable and other assets partially offset by lower prepaid expenses as
compared to the prior year. Also contributing to the decrease in cash provided by operating activities was $22.2 million in payments
made in 2011 related to the acquisition of certain remaining equity interests in Front Line that were classified as liabilities.

Investing Activities
Year Ended 2012 Compared to Year Ended 2011

Cash used in investing activities was $203.8 million for the year ended December 31, 2012, compared to $152.0 million for the
year ended December 31, 2011. The $51.8 million increase in cash used in investing activities is primarily due to higher payments for
acquisitions, purchases of property, plant and equipment, primarily related to technology, and intangible assets partially offset by
lower payments for investments made in nonconsolidated affiliates. See “—Uses of Cash” above for further discussion.

Year Ended 2011 Compared to Year Ended 2010

Cash used in investing activities was $152.0 million for the year ended December 31, 2011, compared to cash provided by

investing activities of $453.0 million for the year ended December 31, 2010. The $605.0 million increase in cash used in investing
activities was primarily due to $576.5 million of cash acquired in the Merger in 2010, less proceeds from the disposals of assets and an
increase in purchases of property, plant and equipment.

Financing Activities

Year Ended 2012 Compared to Year Ended 2011

Cash used in financing activities was $19.9 million for the year ended December 31, 2012, compared to $44.4 million for the
year ended December 31, 2011. The $24.5 million decrease in cash used in financing activities is primarily a result of net proceeds
received in 2012 from the issuance of the 7% senior notes and increased term loan B borrowings, after repayment of the 10.75%
senior notes and related costs, along with additional financing to fund Australian operations as compared to a net pay down in 2011 on
the term loans. We also made less payments of deferred and contingent consideration in 2012 as compared to the same period in 2011.
Also contributing to the decrease was cash used in 2011 for purchases of non-controlling interests for the remaining equity interests in
Front Line. These decreases in cash used were partially offset by proceeds received in 2011 from the sale of common stock in
connection with the subscription agreement with Liberty Media.

Year Ended 2011 Compared to Year Ended 2010

Cash used in financing activities was $44.4 million for the year ended December 31, 2011, compared to cash provided by
financing activities of $49.1 million for the year ended December 31, 2010. The $93.5 million increase in cash used in financing
activities was primarily a result of net proceeds received in 2010 from the issuance of $250 million of 8.125% senior notes and our
new senior secured credit facility, after repayment of the borrowings under the Live Nation and Ticketmaster credit facilities, payment
of debt issuance costs and the redemption of preferred stock, as compared to only a net pay down in 2011 on the term loans. The
increase was also a result of cash used for purchases of non-controlling interests, primarily related to the 2011 acquisition of the
remaining equity interests in Front Line. These increases were partially offset by proceeds received in 2011 from the sale of common
stock in connection with the subscription agreement with Liberty Media.

Seasonality

Our Concerts and Artist Nation segments typically experience higher operating income in the second and third quarters as our
outdoor venues and international festivals are primarily used or occur during May through September, and our artists touring activity
is higher. In addition, the timing of ticket on-sales and the tours of top-grossing acts can impact comparability of quarterly results year
over year, although annual results may not be impacted. Our Ticketing segment sales are impacted by fluctuations in the availability of
events for sale to the public, which vary depending upon scheduling by our clients.

Cash flows from our Concerts segment typically have a slightly different seasonality as payments are often made for artist
performance fees and production costs in advance of the date the related event tickets go on sale. These artist fees and production
costs are expensed when the event occurs. Generally, all costs related to events are expensed when the event occurs with the exception
of advertising costs which are expensed either at the time of the event or annually for future shows. Once tickets for an event go on
sale, we generally begin to receive payments from ticket sales in advance of when the event occurs for events at our owned and/or
operated venues. We record these ticket sales as revenue when the event occurs.

We expect these trends to continue in the future. See Item 1A.—Risk Factors: Our operations are seasonal and our results of

operations vary from quarter to quarter and year over year, so our financial performance in certain quarters may not be indicative of,
or comparable to, our financial performance in subsequent quarters or years.

Market Risk

We are exposed to market risks arising from changes in market rates and prices, including movements in foreign currency

exchange rates and interest rates.

Foreign Currency Risk

We have operations in countries throughout the world. The financial results of our foreign operations are measured in their local

currencies. As a result, our financial results are affected by factors such as changes in foreign currency exchange rates or weak
economic conditions in the foreign markets in which we have operations. Currently, we do not operate in any hyper-inflationary
countries. Our foreign operations reported operating income of $114.1 million for the year ended December 31, 2012. We estimate
that a 10% change in the value of the United States dollar relative to foreign currencies would change our operating income for the
year ended December 31, 2012 by $11.4 million. As of December 31, 2012, our primary foreign exchange exposure included the
Euro, British Pound and Canadian Dollar. This analysis does not consider the implication such currency fluctuations could have on the
overall economic conditions of the United States or other foreign countries in which we operate or on the results of operations of our
foreign entities.

We primarily use forward currency contracts in addition to options to reduce our exposure to foreign currency risk associated
with short-term artist fee commitments. We also enter into forward currency contracts to minimize the risks and/or costs associated
with changes in foreign currency rates on forecasted operating income and short-term intercompany loans. At December 31, 2012, we
had forward currency contracts and options outstanding with a notional amount of $100.0 million.

Interest Rate Risk

Our market risk is also affected by changes in interest rates. We had $1.7 billion of total debt, net of unamortized discounts and
premiums, outstanding as of December 31, 2012. Of the total amount, taking into consideration existing interest rate hedges, we had
$854.1 million of fixed-rate debt and $885.9 million of floating-rate debt.

Based on the amount of our floating-rate debt as of December 31, 2012, each 25 basis point increase or decrease in interest rates

would increase or decrease our annual interest expense and cash outlay by approximately $2.3 million when the floor rate is not
applicable. This potential increase or decrease is based on the simplified assumption that the level of floating-rate debt remains
constant with an immediate across-the-board increase or decrease as of December 31, 2012 with no subsequent change in rates for the
remainder of the period.

61
At December 31, 2012, we have one interest rate cap agreement that is designated as a cash flow hedge for accounting purposes.

The interest rate cap had a notional amount of $77.5 million at December 31, 2012, to limit our cash flow exposure to an interest rate
of 4% per annum. This agreement expires on June 30, 2013. The fair value of this agreement at December 31, 2012 was a de minimis
asset. This agreement was put in place to reduce the variability of a portion of the cash flows from the interest payments related to the
May 2010 senior secured credit facility. The terms of the May 2010 senior secured credit facility require one or more interest rate
protection agreements, with an effect of fixing or limiting the interest costs, for at least 50% of the consolidated total funded debt as of
the closing date for at least three years. Upon the execution of this interest rate cap agreement, the existing interest rate protection
agreements fully met this requirement.

At December 31, 2012, we have an interest rate swap agreement that is designated as a cash flow hedge for accounting
purposes. The interest rate swap had a notional amount of $15.6 million at December 31, 2012 to effectively convert a portion of our
floating-rate debt to a fixed-rate basis and expires in May 2015. The fair value of this agreement at December 31, 2012 was a liability
of $0.2 million. This agreement was put into place to reduce the variability of the cash flows from the interest payments related to
certain financing.

Through our AMG subsidiary, we have two interest rate swap agreements with a $32.2 million aggregate notional amount that

effectively convert a portion of our floating-rate debt to a fixed-rate basis. Both agreements expire in December 2015. Also, in
connection with the financing of the redevelopment of the O2 Dublin, we have an interest rate swap agreement with a notional amount
of $8.5 million that expires in December 2013 effectively converting a portion of our floating-rate debt to a fixed-rate basis. These
interest rate swap agreements have not been designated as hedging instruments. Therefore, any change in fair value is recorded in
earnings during the period of the change.

We currently have 2.875% convertible senior notes due 2027 with a principal amount of $220 million. Beginning with the
period commencing on July 20, 2014 and ending on January 14, 2015, and for each of the interest periods commencing thereafter, we
will pay contingent interest on the notes if the average trading price of the notes during the five consecutive trading days ending on the
second trading day immediately preceding the first day of the applicable interest period equals or exceeds 120% of the principal
amount of the notes. The contingent interest payable per note will equal 0.25% per year of the average trading price of such note
during the applicable five trading-day reference period, payable in arrears.

Recent Accounting Pronouncements
Recently Adopted Pronouncements

In May 2011, the FASB issued guidance that improves comparability of fair value measurements presented and disclosed in

financial statements. This guidance clarifies the application of existing fair value measurement requirements including (1) the
application of the highest and best use and valuation premise concepts, (2) measuring the fair value of an instrument classified in a
reporting entity’s stockholders’ equity, and (3) quantitative information required for fair value measurements categorized within Level
3. It also requires additional disclosure for Level 3 measurements regarding the sensitivity of the fair value to changes in unobservable
inputs and any interrelationships between those inputs. We adopted this guidance on January 1, 2012 and the adoption of this guidance
did not have a material effect on our financial position or results of operations.

In July 2012, the FASB issued guidance which gives companies the option to perform a qualitative assessment to determine

whether it is more likely than not that an indefinite-lived intangible asset is impaired, and in some cases, bypass the two-step
impairment test. This guidance is effective for annual and interim indefinite-lived intangible asset impairment tests performed for
fiscal years beginning after September 15, 2012. Early adoption of the new guidance is permitted. We adopted this guidance on
October 1, 2012.

Recently Issued Pronouncements

In February 2013, the FASB issued guidance which requires companies to disclose additional information about reclassification

adjustments, including (1) changes in accumulated other comprehensive income balances by component and (2) significant items
reclassified out of accumulated other comprehensive income. The new disclosure requirements are to be applied prospectively and are
effective for interim and annual periods beginning after December 15, 2012. We will adopt this guidance on January 1, 2013 and the
adoption of this standard will not have a material effect on our financial position or results of operations.

62
Critical Accounting Policies and Estimates

The preparation of our financial statements in conformity with GAAP requires management to make estimates, judgments and

assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the
financial statements and the reported amount of revenue and expenses during the reporting period. On an ongoing basis, we evaluate
our estimates that are based on historical experience and on various other assumptions that are believed to be reasonable under the
circumstances. The result of these evaluations forms the basis for making judgments about the carrying values of assets and liabilities
and the reported amount of revenue and expenses that are not readily apparent from other sources. Because future events and their
effects cannot be determined with certainty, actual results could differ from our assumptions and estimates, and such difference could
be material. Management believes that the following accounting estimates are the most critical to aid in fully understanding and
evaluating our reported financial results, and they require management’s most difficult, subjective or complex judgments, resulting
from the need to make estimates about the effect of matters that are inherently uncertain. The following narrative describes these
critical accounting estimates, the judgments and assumptions and the effect if actual results differ from these assumptions.

Consolidation

We consolidate entities in which we own more than 50% of the voting common stock and control operations and also variable
interest entities for which we are the primary beneficiary. Investments in nonconsolidated affiliates in which we own more than 20%
of the voting common stock or otherwise exercise significant influence over operating and financial policies, but not control of the
nonconsolidated affiliate, are accounted for using the equity method of accounting. Investments in nonconsolidated affiliates in which
we own less than 20% of the voting common stock are accounted for using the cost method of accounting. Intercompany accounts
among the consolidated businesses have been eliminated in consolidation. Net income (loss) attributable to noncontrolling interests is
reflected in the statements of operations for consolidated affiliates.

Allowance for Doubtful Accounts

We evaluate the collectability of our accounts receivable based on a combination of factors. Generally, we record specific

reserves to reduce the amounts recorded to what we believe will be collected when a customer’s account ages beyond typical
collection patterns, or we become aware of a customer’s inability to meet its financial obligations.

We believe that the credit risk with respect to trade receivables is limited due to the large number and the geographic

diversification of our customers.

Business Combinations

We account for our business combinations under the acquisition method of accounting. Identifiable assets acquired, liabilities

assumed and any noncontrolling interest in the acquiree are recognized and measured as of the acquisition date at fair value.
Additionally, contingent consideration is recorded at fair value on the acquisition date and classified as a liability. Goodwill is
recognized to the extent by which the aggregate of the acquisition-date fair value of the consideration transferred and any
noncontrolling interests in the acquiree exceeds the recognized basis of the identifiable assets acquired, net of assumed liabilities.
Determining the fair value of assets acquired, liabilities assumed and noncontrolling interests requires management’s judgment and
often involves the use of significant estimates and assumptions, including assumptions with respect to future cash flows, discount rates
and asset lives among other items.

Property, Plant and Equipment

We test for possible impairment of property, plant and equipment whenever events or circumstances change, such as a
significant reduction in operating cash flow or a dramatic change in the manner that the asset is intended to be used indicate that the
carrying amount of the asset may not be recoverable. If indicators exist, we compare the estimated undiscounted future cash flows
related to the assets to the carrying amount of those assets. If the carrying value is greater than the estimated undiscounted future cash
flows, the cost basis of the asset is reduced to reflect the current fair value. We use various assumptions in determining the current fair
market value of these assets, including future expected cash flows and discount rates, as well as future salvage values and other fair
value measures. Our impairment loss calculations require us to apply judgment in estimating future cash flows, including forecasting
useful lives of the assets and selecting the discount rate that reflects the risk inherent in future cash flows.

If actual results are not consistent with our assumptions and judgments used in estimating future cash flows and asset fair

values, we may be exposed to future impairment losses that could be material to our results of operations.

63
Intangibles

We test for possible impairment of definite-lived intangible assets whenever events or circumstances change, such as a
significant reduction in operating cash flow or a dramatic change in the manner in which the asset is intended to be used which may
indicate that the carrying amount of the asset may not be recoverable. When specific assets are determined to be unrecoverable, the
cost basis of the asset is reduced to reflect the current fair value.

We test for possible impairment of indefinite-lived intangible assets on at least an annual basis. Based on facts and

circumstances, we perform either a qualitative or a quantitative assessment for impairment. If a qualitative assessment is performed,
and the existence of events and circumstances indicate that it is more likely than not that an indefinite-lived intangible asset is
impaired, then we perform the quantitative impairment test by comparing the fair value with the carrying amount. When specific
assets are determined to be impaired, the cost basis of the asset is reduced to reflect the current fair value.

We use various assumptions in determining the current fair market value of these definite-lived and indefinite-lived assets,
including future expected cash flows and discount rates, as well as other fair value measures. For intangibles related to artist rights, we
use assumptions about future revenue and operating income for the rights acquired. These projections are based on information about
the artists’ past results and expectations about future results. Our impairment loss calculations require us to apply judgment in
estimating future cash flows, including forecasting useful lives of the assets and selecting the discount rate that reflects the risk
inherent in future cash flows.

If actual results are not consistent with our assumptions and judgments used in estimating future cash flows and asset fair

values, we may be exposed to future impairment losses that could be material to our results of operations.

Goodwill

We review goodwill for impairment annually, as of October 1, using a three-step process. The first step is a qualitative

evaluation as to whether it is more likely than not that the fair value of any of our reporting units are less than its carrying value using
an assessment of relevant events and circumstances. Examples of such events and circumstances include financial performance,
industry and market conditions, macroeconomic conditions, reporting unit-specific events, historical results of goodwill impairment
testing and the timing of the last performance of a quantitative assessment. If any reporting units are concluded to be more likely than
not impaired, a second step is performed for that reporting unit. This second step, used to quantitatively screen for potential
impairment, compares the fair value of the reporting unit with its carrying amount, including goodwill. The third step, employed for
any reporting unit that fails the second step, is used to measure the amount of any potential impairment and compares the implied fair
value of the reporting unit’s goodwill with the carrying amount of goodwill. If a reporting unit’s carrying value is negative, we do not
follow this three step process. In this case, a qualitative evaluation is performed to determine whether it is more likely than not that the
reporting unit’s goodwill is impaired. If it is, the third step discussed above is performed to measure the amount of any potential
impairment.

The second and third steps that we use to evaluate goodwill for impairment involve the determination of the fair value of our

reporting units. Inherent in such fair value determinations are certain judgments and estimates relating to future cash flows, including
our interpretation of current economic indicators and market valuations, and assumptions about our strategic plans with regard to our
operations. Due to the uncertainties associated with such estimates, actual results could differ from such estimates.

In developing fair values for our reporting units, we may employ a market multiple or a discounted cash flow methodology, or a

combination thereof. The market multiple methodology compares us to similar companies on the basis of risk characteristics to
determine its risk profile relative to the comparable companies as a group. This analysis generally focuses on quantitative
considerations, which include financial performance and other quantifiable data, and qualitative considerations, which include any
factors which are expected to impact future financial performance. The most significant assumptions affecting the market multiple
methodology are the market multiples and control premium. A control premium represents the value an investor would pay above
noncontrolling interest transaction prices in order to obtain a controlling interest in the respective company.

The discounted cash flow methodology establishes fair value by estimating the present value of the projected future cash flows

to be generated from the reporting unit. The discount rate applied to the projected future cash flows to arrive at the present value is
intended to reflect all risks of ownership and the associated risks of realizing the stream of projected future cash flows. The discounted
cash flow methodology uses our projections of financial performance. The most significant assumptions used in the discounted cash
flow methodology are the discount rate, the attrition rate and expected future revenue and operating margins, which vary among
reporting units.

We also test goodwill for impairment in other periods if an event occurs or circumstances change that would more likely than

not reduce the fair value of a reporting unit below its carrying amount.

64
Revenue Recognition

Revenue from the promotion and production of an event is recognized after the performance occurs upon settlement of the

event. Revenue related to larger global tours is recognized after the performance occurs; however, any profits related to these tours,
primarily related to music tour production and tour management services, is recognized after minimum revenue thresholds, if any,
have been achieved. Revenue collected in advance of the event is recorded as deferred revenue until the event occurs. Revenue
collected from sponsorships and other revenue, which is not related to any single event, is classified as deferred revenue and generally
amortized over the operating season or the term of the contract.

Revenue from our ticketing operations primarily consists of convenience and order processing fees charged at the time a ticket
for an event is sold and is recorded on a net basis (net of the face value of the ticket). For tickets sold for events at our owned and/or
operated venues in the United States, and where we control the tickets internationally, this revenue is recognized after the performance
occurs upon settlement of the event. Revenue for these ticket fees collected in advance of the event is recorded as deferred revenue
until the event occurs. These fees will be shared between our Ticketing segment and our Concerts segment. For tickets sold for events
at third-party venues, this revenue is recognized at the time of the sale and is recorded by our Ticketing segment.

For multiple element contracts, we allocate consideration to the multiple elements based on the relative fair selling price of each
separate element which are determined using vendor specific objective evidence, third-party evidence or our best estimate in order to
assign relative fair values.

We account for taxes that are externally imposed on revenue producing transactions on a net basis, as a reduction of revenue.

Litigation Accruals

We are currently involved in certain legal proceedings and, as required, have accrued our estimate of the probable costs for the

resolution of these claims. Management’s estimates used have been developed in consultation with counsel and are based upon an
analysis of potential results, assuming a combination of litigation and settlement strategies. It is possible, however, that future results
of operations for any particular period could be materially affected by changes in our assumptions or the effectiveness of our strategies
related to these proceedings.

Non-cash and Stock-Based Compensation

We follow the fair value recognition provisions of the FASB guidance for stock compensation. In accordance with this
guidance, we continue to use the Black-Scholes option pricing model to estimate the fair value of our stock options at the date of
grant. Judgment is required in estimating the amount of stock-based awards expected to be forfeited prior to vesting. If actual
forfeitures differ significantly from these estimates, non-cash compensation expense could be materially impacted.

Income Taxes

We account for income taxes using the liability method in accordance with the FASB guidance for income taxes. Under this

method, deferred tax assets and liabilities are determined based on differences between financial reporting bases and tax bases of
assets and liabilities and are measured using the enacted tax rates expected to apply to taxable income in the periods in which the
deferred tax asset or liability is expected to be realized or settled. Deferred tax assets are reduced by valuation allowances if we
believe it is more likely than not that some portion or the entire asset will not be realized. As all earnings from our continuing foreign
operations are permanently reinvested and not distributed, our income tax provision does not include additional United States taxes on
those foreign operations. It is not practical to determine the amount of federal and state income taxes, if any, that might become due in
the event that the earnings were distributed.

The FASB guidance for income taxes prescribes a recognition threshold and a measurement attribute for the financial statement

recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax
position must be more likely than not to be sustained upon examination by taxing authorities. The amount recognized is measured as
the largest amount of benefit that is greater than 50% likely of being realized upon ultimate settlement.

Ratio of Earnings to Fixed Charges

The ratio of earnings to fixed charges is as follows:

2012
*

2011
*

Year Ended December 31,

2010
*

2009
*

2008
*

For the years ended December 31, 2012, 2011, 2010, 2009 and 2008, fixed charges exceeded earnings from continuing
operations before income taxes and fixed charges by $142.1 million, $104.4 million, $193.6 million, $116.5 million and $358.6
million, respectively.

The ratio of earnings to fixed charges was computed on a total company basis. Earnings represent income from continuing

operations before income taxes less equity in undistributed net income (loss) of nonconsolidated affiliates plus fixed charges. Fixed
charges represent interest, amortization of debt discount and premium and the estimated interest portion of rental charges. Rental
charges exclude variable rent expense for events in third-party venues.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Required information is within Item 7. Management’s Discussion and Analysis of Financial Condition and Results of

Operations.

66
ITEM 8.

FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

Report of Independent Registered Public Accounting Firm

The Board of Directors and Stockholders of Live Nation Entertainment, Inc.

We have audited the accompanying consolidated balance sheets of Live Nation Entertainment, Inc. as of December 31, 2012 and
2011, and the related consolidated statements of operations, comprehensive loss, changes in stockholders’ equity, and cash flows for
each of the three years in the period ended December 31, 2012. Our audits also included the financial statement schedule listed in the
index at Item 15(a)2. These financial statements and schedule are the responsibility of the Company’s management. Our responsibility
is to express an opinion on these financial statements and schedule based on our audits.

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

In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial position of
Live Nation Entertainment, Inc. at December 31, 2012 and 2011, and the consolidated results of its operations and its cash flows for
each of the three years in the period ended December 31, 2012, in conformity with U.S. generally accepted accounting principles.
Also in our opinion, the related financial statement schedule, when considered in relation to the basic financial statements taken as a
whole, presents fairly in all material respects the information set forth therein.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), Live
Nation Entertainment, Inc.’s internal control over financial reporting as of December 31, 2012, based on criteria established in Internal
Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report
dated February 26, 2013 expressed an unqualified opinion thereon.

Los Angeles, California
February 26, 2013

LIVE NATION ENTERTAINMENT, INC.
CONSOLIDATED BALANCE SHEETS

December 31,

2012

2011

(in thousands except share data)

ASSETS

Current assets

Cash and cash equivalents................................................................................................................................. $
Accounts receivable, less allowance of $19,794 and $16,986 in 2012 and 2011, respectively .........................
Prepaid expenses ...............................................................................................................................................
Other current assets ...........................................................................................................................................

Total current assets .........................................................................................................................

Property, plant and equipment

Land, buildings and improvements ...................................................................................................................
Computer equipment and capitalized software..................................................................................................
Furniture and other equipment ..........................................................................................................................
Construction in progress....................................................................................................................................

Less accumulated depreciation..........................................................................................................................

Intangible assets

Definite-lived intangible assets, net...................................................................................................................
Indefinite-lived intangible assets .......................................................................................................................
Goodwill.................................................................................................................................................................
Investments in nonconsolidated affiliates...............................................................................................................
Other long-term assets ............................................................................................................................................

Total assets ....................................................................................................................................... $

Current liabilities

LIABILITIES AND STOCKHOLDERS’ EQUITY

Accounts payable, client accounts..................................................................................................................... $
Accounts payable ..............................................................................................................................................
Accrued expenses..............................................................................................................................................
Deferred revenue ...............................................................................................................................................
Current portion of long-term debt .....................................................................................................................
Other current liabilities......................................................................................................................................

Total current liabilities....................................................................................................................

Long-term debt, net ................................................................................................................................................
Long-term deferred income taxes ...........................................................................................................................
Other long-term liabilities.......................................................................................................................................
Commitments and contingent liabilities

1,001,055
415,790
359,936
36,031
1,812,812

852,175
338,919
200,743
56,822
1,448,659
726,873
721,786

724,463
377,463
1,357,827
46,160
250,295
5,290,806

557,953
102,718
626,723
402,002
62,050
16,726
1,768,172

1,677,955
199,596
94,409

844,253
389,346
316,491
26,700
1,576,790

851,812
261,475
172,250
60,652
1,346,189
626,053
720,136

873,712
377,160
1,257,644
55,796
216,106
5,077,344

473,956
87,627
579,566
273,536
52,632
25,236
1,492,553

1,652,629
186,298
120,693

Redeemable noncontrolling interests......................................................................................................................

42,100

8,277

Stockholders’ equity

Preferred stock—Series A Junior Participating, $.01 par value; 20,000,000 shares authorized; no shares

issued and outstanding .................................................................................................................................
Preferred stock, $.01 par value; 30,000,000 shares authorized; no shares issued and outstanding....................
Common stock, $.01 par value; 450,000,000 shares authorized; 190,853,380 and 189,536,279 shares issued
and outstanding in 2012 and 2011, respectively...........................................................................................
Additional paid-in capital..................................................................................................................................
Accumulated deficit ..........................................................................................................................................
Cost of shares held in treasury (578,570 shares in 2011) ..................................................................................
Accumulated other comprehensive loss ............................................................................................................

Total Live Nation Entertainment, Inc. stockholders’ equity........................................................
Noncontrolling interests .........................................................................................................................................

Total stockholders’ equity...............................................................................................................

-
-

1,877
2,272,882
(908,418)
-
(10,923)
1,355,418
153,156
1,508,574

-
-

1,868
2,243,587
(745,191)
(2,787)
(36,374)
1,461,103
155,791
1,616,894

Total liabilities and stockholders’ equity ....................................................................................... $

5,290,806

5,077,344

See Notes to Consolidated Financial Statements

LIVE NATION ENTERTAINMENT, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS

Revenue .............................................................................................................. $
Operating expenses:

Direct operating expenses ..............................................................................
Selling, general and administrative expenses.................................................
Depreciation and amortization .......................................................................
Loss (gain) on sale of operating assets...........................................................
Corporate expenses ........................................................................................
Acquisition transaction expenses ...................................................................
Operating income (loss)...................................................................

Interest expense...................................................................................................
Loss (gain) on extinguishment of debt................................................................
Interest income....................................................................................................
Equity in earnings of nonconsolidated affiliates .................................................
Other expense (income), net ...............................................................................
Loss from continuing operations before income taxes........................................
Income tax expense (benefit) ..............................................................................
Loss from continuing operations.........................................................................
Loss from discontinued operations, net of tax ....................................................
Net loss ...............................................................................................................
Net income attributable to noncontrolling interests ............................................
Net loss attributable to common stockholders of Live Nation Entertainment,

Inc.

Year Ended December 31,
2010
2011
(in thousands except share and per share data)

2012

5,819,047 $

5,383,998 $

5,063,748

4,151,277
1,143,632
429,557
(514)
113,364
3,370
(21,639)

123,740
(460)
(4,170)
(9,921)
1,333
(132,161)
29,736
(161,897)
-
(161,897)
1,330

3,789,488
1,111,969
343,018
978
112,157
8,051
18,337

120,414
-
(4,215)
(7,742)
6,507
(96,627)
(26,224)
(70,403)
-
(70,403)
12,613

3,658,310
1,014,491
321,666
374
110,252
22,355
(63,700)

116,527
21,315
(3,771)
(4,928)
(4,189)
(188,654)
15,154
(203,808)
(4,228)
(208,036)
20,354

(163,227) $

(83,016) $

(228,390)

Basic and diluted net loss per common share attributable to common

stockholders of Live Nation Entertainment, Inc.:
Loss from continuing operations.................................................................... $
Loss from discontinued operations ................................................................
Net loss attributable to common stockholders of Live Nation

(0.87) $
-

(0.46) $
-

(1.36)
(0.03)

Entertainment, Inc. .................................................................................... $

(0.87) $

(0.46) $

(1.39)

Weighted average common shares outstanding: ............................................
Basic and diluted............................................................................................

186,955,748

182,388,070

164,410,167

See Notes to Consolidated Financial Statements

LIVE NATION ENTERTAINMENT, INC.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

2012

Year Ended December 31,
2011
(in thousands)

2010

Net loss ................................................................................................................................... $
Other comprehensive income (loss), net of tax:

Realized loss on cash flow hedges .....................................................................................
Unrealized loss on cash flow hedges..................................................................................
Change in funded status of defined benefit pension plan...................................................
Foreign currency translation adjustments...........................................................................
Comprehensive loss ................................................................................................................
Comprehensive income attributable to noncontrolling interests ........................................

(161,897) $

(70,403) $

(208,036)

(164)
(390)
26,005

(136,446)

1,330

-
(159)
(42)
(13,929)
(84,533)
12,613

6,920
(218)
(179)
(32,966)
(234,479)
20,354

Comprehensive loss attributable to common stockholders of Live Nation

Entertainment, Inc.

(137,776) $

(97,146) $

(254,833)

See Notes to Consolidated Financial Statements

C
N
I

T
N
E
M
N
I
A
T
R
E
T
N
E
N
O
I
T
A
N
E
V
I
L

y
t
i
u
q
E

’
s
r
e
d
l
o
h
k
c
o
t
S

.
c
n
I

,
t
n
e
m
n
i
a
t
r
e
t
n
E
n
o
i
t
a
N
e
v
i
L

Y
T
I
U
Q
E

’
S
R
E
D
L
O
H
K
C
O
T
S
N
I
S
E
G
N
A
H
C
F
O
S
T
N
E
M
E
T
A
T
S
D
E
T
A
D
I
L
O
S
N
O
C

l
a
t
o
T

g
n
i
l
l
o
r
t
n
o
c
n
o
N

s
t
s
e
r
e
t
n
I

d
e
t
a
l
u
m
u
c
c
A

r
e
h
t
O

e
v
i
s
n
e
h
e
r
p
m
o
C

e
m
o
c
n
I

)
s
s
o
L

(

f
o

t
s
o
C

s
e
r
a
h
S

n
i
d
l
e
H

y
r
u
s
a
e
r
T

d
e
t
a
l
u
m
u
c
c
A

t
i
c
i
f
e
D

l
a
n
o
i
t
i
d
d
A

n
I
-
d
i
a
P

l
a
t
i
p
a
C

n
o
m
m
o
C

k
c
o
t
S

n
o
m
m
o
C

s
e
r
a
h
S

d
e
u
s
s
I

e
l
b
a
m
e
e
d
e
R

g
n
i
l
l
o
r
t
n
o
c
n
o
N

s
t
s
e
r
e
t
n
I

)
s
d
n
a
s
u
o
h
t

n
i
(

0
4
6
,
8

7
2
3
,
0
5

6
9
6
,
1
8
9

)
0
2
1
(

)
3
4
5
,
6
(

)
2
9
4
,
6
(

)
7
8
6
,
7
1
(

6
0
2
,
0
6

)
6
1
1
,
0
1
(

)
1
0
2
,
7
(

)
8
1
2
(

0
2
9
,
6

)
9
7
1
(

)
6
6
9
,
2
3
(

)
1
5
1
,
7
0
2
(

9
3
2
,
1
2

)
8
1
2
(

0
2
9
,
6

)
9
7
1
(

)
6
6
9
,
2
3
(

4
2
6

2
8
7
,
2

)
0
9
3
,
8
2
2
(

)
0
2
1
(

3
7
5
,
3

7
4
8
,
5

6
9
6
,
9
4

3
4
6
,
0
2
9

9
0
7

)
7
8
6
,
7
1
(

1
4
4
,
5
2
7

4
2
1
,
3
7

9
9
1
,
4

)
9
2
5
,
9
(

)
5
8
7
,
3
3
4
(

2
7
5
,
0
9
0
,
1

)
a
t
a
d
e
r
a
h
s

t
p
e
c
x
e

,
s
d
n
a
s
u
o
h
t

n
i
(

0
6
8

1
1

6
4
8

2
7
5
,
6
1
0
,
6
8

2
7
3
,
1
0
7

6
3
5
,
3
6
0
,
1

0
5
3
,
2
1
6
,
4
8

9
1

4
7
4
,
8
9

)
4
5
7
,
7
(

7
8
6
,
7
1

)
5
8
8
(

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
9
0
0
2

,
1
3

r
e
b
m
e
c
e
D

t
a
s
e
c
n
a
l
a
B

.
.
.
.
.
n
o
i
t
a
s
n
e
p
m
o
c

d
e
s
a
b
-
k
c
o
t
s
d
n
a
h
s
a
c
-
n
o
N

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
s
n
o
i
t
p
o
k
c
o
t
s

f
o

e
s
i
c
r
e
x
E

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
s
n
o
i
t
i
s
i
u
q
c
A

.
.
.
.
.
.

s
t
s
e
r
e
t
n
i

g
n
i
l
l
o
r
t
n
o
c
n
o
n

f
o

s
n
o
i
t
i
s
i
u
q
c
A

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
s
t
s
e
r
e
t
n
i

g
n
i
l
l
o
r
t
n
o
c
n
o
n

f
o

s
e
l
a
S

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
s
t
n
e
m
t
s
u
j
d
a

e
u
l
a
v

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
x
a
t

f
o
t
e
n

,
s
d
n
e
d
i
v
i
d

h
s
a
C

r
i
a
f

s
t
s
e
r
e
t
n
i

g
n
i
l
l
o
r
t
n
o
c
n
o
n
e
l
b
a
m
e
e
d
e
R

:
)
s
s
o
l
(

e
m
o
c
n
i

e
v
i
s
n
e
h
e
r
p
m
o
C

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.

)
s
s
o
l
(

e
m
o
c
n
i

t
e
N

.
.
.
.
.
.
.
.
.

s
e
g
d
e
h
w
o
l
f

h
s
a
c
n
o

s
s
o
l

d
e
z
i
l
a
e
R

.
.
.
.
.
.
s
e
g
d
e
h
w
o
l
f
h
s
a
c

n
o
s
s
o
l

d
e
z
i
l
a
e
r
n
U

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
n
a
l
p

n
o
i
s
n
e
p

t
i
f
e
n
e
b

.
.
.
.
.
.
.
.
.
.
.
.
.
t
n
e
m
t
s
u
j
d
a

n
o
i
t
a
l
s
n
a
r
t
y
c
n
e
r
r
u
C

d
e
n
i
f
e
d

f
o

s
u
t
a
t
s
d
e
d
n
u
f

n
i

e
g
n
a
h
C

8
6
6
,
1
0
5
,
1

2
5
2
,
7
3
1

)
4
4
2
,
2
2
(

)
2
2
1
,
6
(

)
5
7
1
,
2
6
6
(

3
3
2
,
3
5
0
,
2

4
2
7
,
1

0
3
8
,
3
9
3
,
2
7
1

1
4
5
,
7
0
1

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
0
1
0
2

,
1
3

r
e
b
m
e
c
e
D

t
a
s
e
c
n
a
l
a
B

5
0
7
,
2

6
8
1
,
1
3

2
9
4
,
6
7

8
7
6
,
4

4
8
8
,
4
9

)
9
3
1
,
3
(

)
4
2
4
(

)
7
3
9
,
1
(

9
3
5
,
3

)
7
4
3
,
3
1
(

)
9
5
1
(

)
1
8
2
,
5
6
(

)
2
4
(

)
9
2
9
,
3
1
(

4
1
6
,
4

4
9
2
,
9

)
9
3
1
,
3
(

)
7
5
1
(

9
3
5
,
3

)
7
4
3
,
3
1
(

5
3
7
,
7
1

)
9
5
1
(

)
2
4
(

)
9
2
9
,
3
1
(

2
1

3
2
3
,
3

)
6
1
0
,
3
8
(

8
8
6
,
2

1
6
8
,
7
2

9
1
4
,
6
7

0
9
5
,
5
8

)
7
6
2
(

)
7
3
9
,
1
(

3
7

4
6

1
6
6
,
3
9
1

3
1
3
,
5
2
5

0
0
0
,
0
0
3
,
7

4
4
1
,
7
7
3
,
6

8
6
2
,
8

)
7
6
0
,
8
9
(

7
3
9
,
1

)
0
1
7
(

)
0
7
5
,
5
(

)
2
2
1
,
5
(

.
.
.
.
.
n
o
i
t
a
s
n
e
p
m
o
c

d
e
s
a
b
-
k
c
o
t
s
d
n
a
h
s
a
c
-
n
o
N

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
s
n
o
i
t
p
o
k
c
o
t
s

f
o

e
s
i
c
r
e
x
E

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
s
e
r
a
h
s

n
o
m
m
o
c

f
o

e
l
a
S

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
s
n
o
i
t
i
s
i
u
q
c
A

.
.
.
.
.
.

s
t
s
e
r
e
t
n
i

g
n
i
l
l
o
r
t
n
o
c
n
o
n

f
o

s
n
o
i
t
i
s
i
u
q
c
A

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
s
t
s
e
r
e
t
n
i

g
n
i
l
l
o
r
t
n
o
c
n
o
n

f
o

s
e
l
a
S

r
i
a
f

s
t
s
e
r
e
t
n
i

g
n
i
l
l
o
r
t
n
o
c
n
o
n
e
l
b
a
m
e
e
d
e
R

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
s
t
n
e
m
t
s
u
j
d
a

e
u
l
a
v

.
.
.
.
.
.
.
.
.
s
n
o
i
t
u
b
i
r
t
n
o
c

s
t
s
e
r
e
t
n
i

g
n
i
l
l
o
r
t
n
o
c
n
o
N

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
x
a
t

f
o
t
e
n

,
s
d
n
e
d
i
v
i
d

h
s
a
C

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
r
e
h
t
O

:
)
s
s
o
l
(

e
m
o
c
n
i

e
v
i
s
n
e
h
e
r
p
m
o
C

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.

)
s
s
o
l
(

e
m
o
c
n
i

t
e
N

.
.
.
.
.
.
.
.
.

s
e
g
d
e
h
w
o
l
f

h
s
a
c
n
o

s
s
o
l

d
e
z
i
l
a
e
R

.
.
.
.
.
.
s
e
g
d
e
h
w
o
l
f
h
s
a
c

n
o
s
s
o
l

d
e
z
i
l
a
e
r
n
U

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
n
a
l
p

n
o
i
s
n
e
p

t
i
f
e
n
e
b

.
.
.
.
.
.
.
.
.
.
.
.
.
t
n
e
m
t
s
u
j
d
a

n
o
i
t
a
l
s
n
a
r
t
y
c
n
e
r
r
u
C

d
e
n
i
f
e
d

f
o

s
u
t
a
t
s
d
e
d
n
u
f

n
i

e
g
n
a
h
C

4
9
8
,
6
1
6
,
1

1
9
7
,
5
5
1

)
4
7
3
,
6
3
(

)
7
8
7
,
2
(

)
1
9
1
,
5
4
7
(

7
8
5
,
3
4
2
,
2

8
6
8
,
1

8
4
9
,
9
8
7
,
6
8
1

7
7
2
,
8

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
1
1
0
2

,
1
3

r
e
b
m
e
c
e
D

t
a
s
e
c
n
a
l
a
B

l
a
t
o
T

s
t
s
e
r
e
t
n
I

g
n
i
l
l
o
r
t
n
o
c
n
o
N

e
m
o
c
n
I

)
s
s
o
L

(

d
e
t
a
l
u
m
u
c
c
A

r
e
h
t
O

e
v
i
s
n
e
h
e
r
p
m
o
C

y
r
u
s
a
e
r
T

t
i
c
i
f
e
D

f
o
t
s
o
C

s
e
r
a
h
S

n
i
d
l
e
H

d
e
t
a
l
u
m
u
c
c
A

l
a
n
o
i
t
i
d
d
A

n
I
-
d
i
a
P

l
a
t
i

p
a
C

n
o
m
m
o
C

k
c
o
t
S

n
o
m
m
o
C

s
e
r
a
h
S

d
e
u
s
s
I

y
t
i
u
q
E

’
s
r
e
d
l
o
h
k
c
o
t
S

.
c
n
I

,
t
n
e
m
n
i
a
t
r
e
t
n
E
n
o
i
t
a
N
e
v
i
L

)
a
t
a
d
e
r
a
h
s

t
p
e
c
x
e

,
s
d
n
a
s
u
o
h
t

n
i
(

e
l
b
a
m
e
e
d
e
R

g
n
i
l
l
o
r
t
n
o
c
n
o
N

s
t
s
e
r
e
t
n
I

)
s
d
n
a
s
u
o
h
t

n
i
(

3
4
1
,
1

6
0
7
,
1
3

0
4
5
,
5
1

)
6
3
2
(

)
1
0
8
(

5
2
8

)
9
7
2
(

5
2
8

)
8
9
4
,
1
(

)
9
7
0
,
0
2
(

)
1
7
3
,
0
6
1
(

6
5
8
,
2

)
4
6
1
(

)
0
9
3
(

5
0
0
,
6
2

)
4
6
1
(

)
0
9
3
(

5
0
0
,
6
2

4
7
5
,
8
0
5
,
1
$

6
5
1
,
3
5
1

)
3
2
9
,
0
1
(

7
8
7
,
2

)
7
2
2
,
3
6
1
(

3
4

0
4
1
,
1

3
1
9
,
8
2

)
1
0
8
(

4
9
5
,
1
0
6

9
9
7
,
9
5
2

6
6
8
,
7
3

1
0
8

2
8
6

)
0
0
0
,
4
(

)
6
2
5
,
1
(

s
t
s
e
r
e
t
n
i

g
n
i
l
l
o
r
t
n
o
c
n
o
n

e
l
b
a
m
e
e
d
e
R

g
n
i
l
l
o
r
t
n
o
c
n
o
n
f
o
s
n
o
i
t
i
s
i
u
q
c
A

d
e
s
a
b
-
k
c
o
t
s
d
n
a
h
s
a
c
-
n
o
N

s
n
o
i
t
p
o
k
c
o
t
s

f
o
e
s
i
c
r
e
x
E

n
o
i
t
a
s
n
e
p
m
o
c

s
n
o
i
t
i
s
i
u
q
c
A

s
t
s
e
r
e
t
n
i

n
a
l
p
n
o
i
s
n
e
p
t
i
f
e
n
e
b
d
e
n
i
f
e
d

t
n
e
m
t
s
u
j
d
a

n
o
i
t
a
l
s
n
a
r
t

y
c
n
e
r
r
u
C

f
o
s
u
t
a
t
s

d
e
d
n
u
f

n
i

e
g
n
a
h
C

w
o
l
f
h
s
a
c

n
o

s
s
o
l

d
e
z
i
l
a
e
r
n
U

)
s
s
o
l
(

e
m
o
c
n
i

t
e
N

:
)
s
s
o
l
(

e
m
o
c
n
i

e
v
i
s
n
e
h
e
r
p
m
o
C

s
e
g
d
e
h

s
t
n
e
m
t
s
u
j
d
a

e
u
l
a
v
r
i
a
f

s
t
s
e
r
e
t
n
i

g
n
i
l
l
o
r
t
n
o
c
n
o
N

s
n
o
i
t
u
b
i
r
t
n
o
c

x
a
t

f
o
t
e
n

,
s
d
n
e
d
i
v
i
d
h
s
a
C

n
o
i
t
p
o
t
u
p
f
o
e
s
i
c
r
e
x
E

.
.
.
.

r
e
h
t
O

s
t
n
e
m
e
t
a
t
S

l
a
i
c
n
a
n
i
F
d
e
t
a
d
i
l
o
s
n
o
C
o
t

s
e
t
o
N
e
e
S

)
8
1
4
,
8
0
9
(

2
8
8
,
2
7
2
,
2
$

7
7
8
,
1

1
4
3
,
1
5
6
,
7
8
1

0
0
1
,
2
4

2
1
0
2
,
1
3
r
e
b
m
e
c
e
D

t
a
s
e
c
n
a
l
a
B

LIVE NATION ENTERTAINMENT, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS

CASH FLOWS FROM OPERATING ACTIVITIES
Net loss................................................................................................................................... $
Reconciling items:

Depreciation ......................................................................................................................
Amortization .....................................................................................................................
Impairment of operational assets.......................................................................................
Deferred income tax benefit ..............................................................................................
Amortization of debt issuance costs and discount/premium, net.......................................
Provision for uncollectible accounts receivable and advances ..........................................
Non-cash (gain) loss on extinguishment of debt ...............................................................
Non-cash compensation expense.......................................................................................
Unrealized changes in fair value of contingent consideration ...........................................
Loss (gain) on sale of operating assets ..............................................................................
Equity in earnings of nonconsolidated affiliates................................................................
Other, net...........................................................................................................................

Changes in operating assets and liabilities, net of effects of acquisitions and dispositions:

Increase in accounts receivable .........................................................................................
Decrease (increase) in prepaid expenses ...........................................................................
Increase in other assets ......................................................................................................
Increase in accounts payable, accrued expenses and other liabilities ................................
Increase (decrease) in deferred revenue ............................................................................
Net cash provided by operating activities..........................................................

CASH FLOWS FROM INVESTING ACTIVITIES
Distributions from nonconsolidated affiliates.........................................................................
Investments made in nonconsolidated affiliates .....................................................................
Purchases of property, plant and equipment ...........................................................................
Proceeds from disposal of operating assets, net of cash divested ...........................................
Cash paid for acquisitions, net of cash acquired .....................................................................
Purchases of intangible assets.................................................................................................
Decrease (increase) in other, net.............................................................................................
Net cash provided by (used in) investing activities ...........................................

2012

Year Ended December 31,
2011
(in thousands)

2010

(161,897) $

(70,403) $

(208,036)

124,593
304,964
-
(10,957)
16,696
8,787
(460)
37,063
(894)
(514)
(9,921)
1,642

(20,319)
(69,175)
(41,707)
64,437
124,760
367,098

9,241
(3,788)
(123,811)
8,293
(75,641)
(14,562)
(3,523)
(203,791)

129,177
213,841
-
(45,603)
13,059
9,272
-
50,045
(11,691)
978
(7,742)
2,481

(79,807)
73,314
(83,928)
6,817
(64,105)
135,705

9,273
(15,770)
(107,500)
7,391
(39,465)
(2,591)
(3,355)
(152,017)

135,573
186,093
13,373
(25,021)
11,437
6,606
8,272
52,395
3,171
4,602
(4,928)
-

(4,581)
(22,570)
(41,686)
386
43,432
158,518

5,863
(3,458)
(75,578)
35,756
491,531
(1,790)
663
452,987

CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from long-term debt, net of debt issuance costs ......................................................
Payments on long-term debt ...................................................................................................
Redemption of preferred stock ...............................................................................................
Contributions from noncontrolling interests ...........................................................................
Distributions to noncontrolling interests.................................................................................
Purchases and sales of noncontrolling interests, net ...............................................................
Proceeds from exercise of stock options.................................................................................
Proceeds from sale of common stock .....................................................................................
Equity issuance costs ..............................................................................................................
Payments for purchases of common stock..............................................................................
Payments for deferred and contingent consideration ..............................................................
Net cash provided by (used in) financing activities ...........................................
Effect of exchange rate changes on cash and cash equivalents...............................................
Net increase (decrease) in cash and cash equivalents ........................................
Cash and cash equivalents at beginning of period ..................................................................
Cash and cash equivalents at end of period ............................................................................ $

538,124
(525,060)
-
825
(20,079)
(4,259)
1,143
-
-
-
(10,585)
(19,891)
13,386
156,802
844,253
1,001,055 $

(669)
(31,338)
-
711
(20,863)
(47,610)
2,705
76,492
-
-
(23,807)
(44,379)
12,186
(48,505)
892,758
844,253 $

1,352,856
(1,233,020)
(40,000)
429
(14,955)
(6,670)
8,640
-
(357)
(1,567)
(16,270)
49,086
(4,788)
655,803
236,955
892,758

SUPPLEMENTAL DISCLOSURE
Cash paid during the year for:

Interest............................................................................................................................... $
Income taxes, net of refunds.............................................................................................. $

107,975 $
(2,238) $

107,288 $
37,746 $

89,876
50,579

See Notes to Consolidated Financial Statements

LIVE NATION ENTERTAINMENT, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1—THE COMPANY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

History

Live Nation was incorporated in Delaware on August 2, 2005 in preparation for the contribution and transfer by Clear Channel

of substantially all of its entertainment assets and liabilities to the Company. The Company completed the Separation on
December 21, 2005 and became a publicly traded company on the New York Stock Exchange trading under the symbol “LYV.” Prior
to the Separation, Live Nation was a wholly-owned subsidiary of Clear Channel.

On January 25, 2010, the Company merged with Ticketmaster. Effective on the date of the Merger, Ticketmaster became a

wholly-owned subsidiary of Live Nation and Live Nation, Inc. changed its name to Live Nation Entertainment, Inc. Ticketmaster’s
results of operations are included in the Company’s consolidated financial statements beginning January 26, 2010. See Note 3—
Acquisitions for prior year pro forma information regarding the impacts of the Merger.

Seasonality

Due to the seasonal nature of shows at outdoor amphitheaters and festivals, which primarily occur May through September, the

Company experiences higher revenue for the Concerts segment during the second and third quarters. The Artist Nation segment’s
revenue is impacted, to a large degree, by the touring schedules of the artists it represents. Generally, the Company experiences higher
revenue in this segment during the second and third quarters as the period from May through September tends to be a popular time for
touring events. The Ticketing segment’s sales are impacted by fluctuations in the availability of events for sale to the public, which
vary depending upon scheduling by its clients. The Company’s seasonality also results in higher balances in cash and cash
equivalents, accounts receivable, prepaid expenses, accrued expenses and deferred revenue at different times in the year.

Basis of Presentation and Principles of Consolidation

The Company’s consolidated financial statements include all accounts of the Company, its majority owned and controlled

subsidiaries and variable interest entities for which the Company is the primary beneficiary.

The Company consolidates entities in which the Company owns more than 50% of the voting common stock and controls
operations and also variable interest entities for which the Company is the primary beneficiary. Investments in nonconsolidated
affiliates in which the Company owns more than 20% of the voting common stock or otherwise exercises significant influence over
operating and financial policies but not control of the nonconsolidated affiliate are accounted for using the equity method of
accounting. Investments in nonconsolidated affiliates in which the Company owns less than 20% of the voting common stock are
accounted for using the cost method of accounting. Intercompany accounts among the consolidated businesses have been eliminated in
consolidation. Net income (loss) attributable to noncontrolling interests is reflected in the statements of operations for consolidated
affiliates.

All cash flow activity reflected on the consolidated statements of cash flows for the Company is presented net of any non-cash
transactions so the amounts reflected may be different than amounts shown in other places in the Company’s financial statements that
are not just related to cash flow amounts. For example, the purchases of property, plant and equipment reflected on the consolidated
statements of cash flows reflects the amount of cash paid during the year for these purchases and does not include the impact of the
changes in accrued liabilities related to capital expenditures during the year. In addition, the consolidated statements of cash flows for
all years presented include all cash flow activity for the Company, including line item details of any applicable activity in businesses
that were sold and are now reflected as discontinued operations on the statements of operations.

Cash and Cash Equivalents

Cash and cash equivalents include all highly liquid investments with an original maturity of three months or less. The

Company’s cash and cash equivalents consist primarily of domestic and foreign bank accounts as well as money market accounts. To
reduce its credit risk, the Company monitors the credit standing of the financial institutions that hold the Company’s cash and cash
equivalents. These balances are stated at cost, which approximates fair value.

Included in the December 31, 2012 and 2011 cash and cash equivalents balance is $441.6 million and $373.9 million,

respectively, of funds representing amounts equal to the face value of tickets sold on behalf of clients and the clients’ share of
convenience and order processing charges (“client funds”). The Company does not utilize client funds for its own financing or
investing activities as the amounts are payable to clients and these amounts due are included in accounts payable, client accounts.

The Company’s available cash and cash equivalents are held in accounts managed by third-party financial institutions and

consist of cash in operating accounts and invested cash. Cash held in operating accounts in many cases exceeds the Federal Deposit
Insurance Corporation insurance limits. The invested cash is held in interest-bearing funds in bank deposits and money market funds.

While the Company monitors cash and cash equivalents balances in its operating accounts on a regular basis and adjusts the

balances as appropriate, these balances could be impacted in the future if the underlying financial institutions fail. To date, the
Company has experienced no loss or lack of access to its cash or cash equivalents; however, the Company can provide no assurances
that access to its cash and cash equivalents will not be impacted in the future by adverse conditions in the financial markets.

Allowance for Doubtful Accounts

The Company evaluates the collectability of its accounts receivable based on a combination of factors. Generally, it records

specific reserves to reduce the amounts recorded to what it believes will be collected when a customer’s account ages beyond typical
collection patterns, or the Company becomes aware of a customer’s inability to meet its financial obligations.

The Company believes that the credit risk with respect to trade receivables is limited due to the large number and the geographic

diversification of its customers.

Prepaid Expenses

The majority of the Company’s prepaid expenses relate to event expenses including show advances and deposits and other costs

directly related to future concert events. For advances that are expected to be recouped over a period of more than 12 months, the
long-term portion of the advance is classified as other long-term assets. These prepaid costs are charged to operations upon completion
of the related events.

Ticketing Contract Advances

Ticketing contract advances, which can be either recoupable or non-recoupable, represent amounts paid in advance to the
Company’s clients pursuant to ticketing agreements. Recoupable ticketing contract advances are generally recoupable against future
royalties earned by the clients, based on the contract terms, over the life of the contract. Non-recoupable ticketing contract advances,
excluding those amounts paid to support clients’ advertising costs, are fixed additional incentives occasionally paid by the Company
to secure exclusive rights with certain clients and are normally amortized over the life of the contract on a straight-line basis.
Amortization of these non-recoupable ticketing contract advances is included in depreciation and amortization in the statements of
operations. For the years ended December 31, 2012, 2011 and 2010, the Company amortized $48.1 million, $38.6 million and $24.1
million, respectively, related to non-recoupable ticketing contract advances.

Business Combinations

The Company accounts for its business combinations under the acquisition method of accounting. Identifiable assets acquired,

liabilities assumed and any noncontrolling interest in the acquiree are recognized and measured as of the acquisition date at fair value.
Additionally, any contingent consideration is recorded at fair value on the acquisition date and classified as a liability. Goodwill is
recognized to the extent by which the aggregate of the acquisition-date fair value of the consideration transferred and any
noncontrolling interests in the acquiree exceeds the recognized basis of the identifiable assets acquired, net of assumed liabilities.
Determining the fair value of assets acquired, liabilities assumed and noncontrolling interests requires management’s judgment and
often involves the use of significant estimates and assumptions, including assumptions with respect to future cash flows, discount rates
and asset lives among other items.

Property, Plant and Equipment

Property, plant and equipment are stated at cost or fair value at date of acquisition. Depreciation, which is recorded for both
owned assets and assets under capital leases, is computed using the straight-line method over their estimated useful lives, which are as
follows:

Buildings and improvements — 10 to 50 years
Computer equipment and capitalized software — 3 to 10 years
Furniture and other equipment — 3 to 10 years

Leasehold improvements are depreciated over the shorter of the economic life or associated lease term assuming the Company

exercises renewal periods, if appropriate. Expenditures for maintenance and repairs are charged to operations as incurred, whereas
expenditures for renewal and improvements are capitalized.

75
The Company tests for possible impairment of property, plant, and equipment whenever events or circumstances change, such
as a significant reduction in operating cash flow or a dramatic change in the manner that the asset is intended to be used which may
indicate that the carrying amount of the asset may not be recoverable. If indicators exist, the Company compares the estimated
undiscounted future cash flows related to the asset to the carrying value of the asset. If the carrying value is greater than the estimated
undiscounted future cash flow amount, an impairment charge is recorded based on the difference between the fair value and the
carrying value. Any such impairment charge is recorded in depreciation and amortization expense in the statement of operations. The
impairment loss calculations require management to apply judgment in estimating future cash flows and the discount rates that reflect
the risk inherent in future cash flows.

Intangible Assets

The Company classifies intangible assets as definite-lived and indefinite-lived. Definite-lived intangibles primarily include

revenue-generating contracts, client/vendor relationships, non-compete agreements, venue management and leasehold agreements,
technology and trademarks and naming rights, all of which are amortized either pro-rata over the respective lives of the agreements,
typically three to twenty years, or on a basis more representative of the time pattern over which the benefit is derived. The Company
periodically reviews the appropriateness of the amortization periods related to its definite-lived intangible assets. These assets are
stated at cost or fair value. Indefinite-lived intangibles primarily include trade names. The excess cost over fair value of net assets
acquired is classified as goodwill. Goodwill and indefinite-lived intangibles are not subject to amortization, but are reviewed for
impairment at least annually.

The Company tests for possible impairment of definite-lived intangible assets whenever events or circumstances change, such as

a significant reduction in operating cash flow or a dramatic change in the manner that the asset is intended to be used which may
indicate that the carrying amount of the asset may not be recoverable. If indicators exist, the Company compares the estimated
undiscounted future cash flows related to the asset to the carrying value of the asset. If the carrying value is greater than the estimated
undiscounted future cash flow amount, an impairment charge is recorded based on the difference between the fair value and the
carrying value. Any such impairment charge is recorded in depreciation and amortization expense in the statement of operations.

The Company tests for possible impairment of indefinite-lived intangible assets at least annually. Depending on facts and
circumstances, qualitative factors may first be assessed to determine whether the existence of events and circumstances indicate that it
is more likely than not that an indefinite-lived intangible asset is impaired. If it is concluded that it is more likely than not impaired,
then the Company performs a quantitative impairment test by comparing the fair value with the carrying amount. If the qualitative
assessment is not performed first, the Company performs only this quantitative test. When specific assets are determined to be
impaired, the cost basis of the asset is reduced to reflect the current fair value. Any such impairment charge would be recorded in
depreciation and amortization in the statement of operations.

The impairment loss calculations require management to apply judgment in estimating future cash flows and the discount rates

that reflect the risk inherent in future cash flows.

Goodwill

The Company reviews goodwill for impairment at least annually, as of October 1, using a three-step process. The first step is a

qualitative evaluation as to whether it is more likely than not that the fair value of any of the Company’s reporting units is less than its
carrying value using an assessment of relevant events and circumstances. Examples of such events and circumstances include financial
performance, industry and market conditions, macroeconomic conditions, reporting unit-specific events, historical results of goodwill
impairment testing and the timing of the last performance of a quantitative assessment. If any reporting units are concluded to be more
likely than not impaired, a second step is performed for that reporting unit. This second step, used to quantitatively screen for potential
impairment, compares the fair value of the reporting unit’s goodwill with its carrying amount, including goodwill. The third step,
employed for any reporting unit that fails the second step, is used to measure the amount of any potential impairment and compares
the implied fair value of the reporting unit with the carrying amount of goodwill. If a reporting unit’s carrying value is negative, the
Company does not follow this three-step process. In this case, a qualitative evaluation is performed to determine whether it is more
likely than not that the reporting unit’s goodwill is impaired. If it is, the third step discussed above is performed to measure the amount
of any potential impairment.

The second and third steps that the Company uses to evaluate goodwill for impairment involve the determination of the fair
value of the Company’s reporting units. Inherent in such fair value determinations are certain judgments and estimates relating to
future cash flows, including the Company’s interpretation of current economic indicators and market valuations, and assumptions
about the Company’s strategic plans with regard to its operations. Due to the uncertainties associated with such estimates, actual
results could differ from such estimates.

76
In developing fair values for its reporting units, the Company may employ a market multiple or a discounted cash flow
methodology, or a combination thereof. The market multiple methodology compares the Company to similar companies on the basis
of risk characteristics to determine its risk profile relative to the comparable companies as a group. This analysis generally focuses on
quantitative considerations, which include financial performance and other quantifiable data, and qualitative considerations, which
include any factors which are expected to impact future financial performance. The most significant assumptions affecting the market
multiple methodology are the market multiples used and control premium. A control premium represents the value an investor would
pay above noncontrolling interest transaction prices in order to obtain a controlling interest in the respective company.

The discounted cash flow methodology establishes fair value by estimating the present value of the projected future cash flows

to be generated from the reporting unit. The discount rate applied to the projected future cash flows to arrive at the present value is
intended to reflect all risks of ownership and the associated risks of realizing the stream of projected future cash flows. The discounted
cash flow methodology uses the Company’s projections of financial performance. The most significant assumptions used in the
discounted cash flow methodology are the discount rate, attrition rate and expected future revenue and operating margins, which vary
among reporting units.

The Company also tests goodwill for impairment in interim periods if an event occurs or circumstances change that would more

likely than not reduce the fair value of a reporting unit below its carrying amount.

Nonconsolidated Affiliates

In general, nonconsolidated investments in which the Company owns more than 20% of the common stock or otherwise
exercises significant influence over the affiliate are accounted for under the equity method. The Company recognizes gains or losses
upon the issuance of securities by any of its equity method investees. The Company reviews the value of equity method investments
and records impairment charges in the statement of operations for any decline in value that is determined to be other-than-temporary.

Accounts Payable, Client Accounts

Accounts payable, client accounts consists of contractual amounts due to ticketing clients which includes the face value of

tickets sold and the clients’ share of convenience and order processing charges.

Income Taxes

The Company accounts for income taxes using the liability method in accordance with the FASB guidance for income taxes.
Under this method, deferred tax assets and liabilities are determined based on differences between financial reporting bases and tax
bases of assets and liabilities and are measured using the enacted tax rates expected to apply to taxable income in the periods in which
the deferred tax asset or liability is expected to be realized or settled. Deferred tax assets are reduced by valuation allowances if the
Company believes it is more likely than not that some portion of or the entire asset will not be realized. As all earnings from the
Company’s continuing foreign operations are permanently reinvested and not distributed, the Company’s income tax provision does
not include additional United States taxes on those foreign operations. It is not practical to determine the amount of federal and state
income taxes, if any, that might become due in the event that the earnings were distributed.

The FASB guidance for income taxes prescribes a recognition threshold and a measurement attribute for the financial statement

recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax
position must be more likely than not to be sustained upon examination by taxing authorities. The amount recognized is measured as
the largest amount of benefit that is more likely than not to be realized upon ultimate settlement.

The Company has established a policy of including interest related to tax loss contingencies in income tax expense (benefit).

Revenue Recognition

Revenue from the promotion and production of an event is recognized after the performance occurs upon settlement of the

event. Revenue related to larger global tours is recognized after the performance occurs; however, any profits related to these tours,
primarily related to music tour production and tour management services, is recognized after minimum revenue guarantee thresholds,
if any, have been achieved. Revenue collected in advance of the event is recorded as deferred revenue until the event occurs. Revenue
collected from sponsorships and other revenue, which is not related to any single event, is classified as deferred revenue and generally
amortized over the operating season or the term of the contract. Membership revenue is recognized on a straight-line basis over the
term of the membership.

77
Revenue from the Company’s ticketing operations primarily consists of convenience and order processing fees charged at the
time a ticket for an event is sold and is recorded on a net basis (net of the face value of the ticket). For tickets sold for events at the
Company’s owned and/or operated venues in the United States, and where the Company controls the tickets internationally, this
revenue is recognized after the performance occurs upon settlement of the event. Revenue for the associated ticket fees collected in
advance of the event is recorded as deferred revenue until the event occurs. These fees are shared between the Company’s Ticketing
segment and the Concerts segment. For tickets sold for events at third-party venues, the revenue is recognized at the time of the sale
and is recorded by the Company’s Ticketing segment.

For multiple element contracts, the Company allocates consideration to the multiple elements based on the relative selling price
of each separate element which are determined using vendor specific objective evidence, third-party evidence or the Company’s best
estimate in order to assign relative fair values.

The Company accounts for taxes that are externally imposed on revenue producing transactions on a net basis, as a reduction of

revenue.

Gross versus Net Revenue Recognition

The Company reports revenue on a gross or net basis based on management’s assessment of whether the Company acts as a

principal or agent in the transaction. To the extent the Company acts as the principal, revenue is reported on a gross basis. The
determination of whether the Company acts as a principal or an agent in a transaction is based on an evaluation of whether the
Company has the substantial risks and rewards of ownership under the terms of an arrangement. The Ticketing segment’s revenue,
which primarily consists of convenience charges and order processing fees from its ticketing operations, is recorded net of the face
value of the ticket as the Company generally acts as an agent in these transactions.

Foreign Currency

Results of operations for foreign subsidiaries and foreign equity investees are translated into United States dollars using the

average exchange rates during the year. The assets and liabilities of those subsidiaries and investees are translated into United States
dollars using the exchange rates at the balance sheet date. The related translation adjustments are recorded in a separate component of
stockholders’ equity in accumulated OCI. Cumulative translation adjustments included in accumulated OCI were $(9.7) million and
$(35.7) million as of December 31, 2012 and 2011, respectively. Foreign currency transaction gains and losses are included in the
statements of operations. For the years ended December 31, 2012 and 2010, the Company recorded net foreign currency transaction
gains of $1.4 million and $2.8 million, respectively. For the year ended December 31, 2011, the Company recorded net foreign
currency transaction losses of $5.1 million. The Company does not have operations in highly inflationary countries.

Advertising Expense

The Company records advertising expense as it is incurred on an annual basis. Advertising expenses of $208.0 million, $200.5

million and $206.6 million for the years ended December 31, 2012, 2011 and 2010, respectively, were recorded as a component of
direct operating expenses. Advertising expenses of $21.6 million, $18.0 million and $14.6 million for the years ended December 31,
2012, 2011 and 2010, respectively, were recorded as a component of selling, general and administrative expenses.

Direct Operating Expenses

Direct operating expenses include artist fees, show related marketing and advertising expenses, royalties paid to clients for a
share of convenience and order processing fees, rent expense for events in third-party venues, credit card fees, telecommunications
and data communication costs associated with the Company’s call centers, commissions paid on tickets distributed through
independent sales outlets away from the box office, and salaries and wages related to seasonal employees at the Company’s venues
along with other costs, including ticket stock and shipping. These costs are primarily variable in nature.

Selling, General and Administrative Expenses

Selling, general and administrative expenses include salaries and wages related to full-time employees, fixed rent, legal

expenses and consulting along with other costs.

Depreciation and Amortization

The Company’s depreciation and amortization is presented as a separate line item in the statements of operations. There is no

depreciation or amortization included in direct operating expenses or selling, general and administrative expenses.

78
Non-cash and Stock-based Compensation

The Company follows the fair value recognition provisions in the FASB guidance for stock compensation. Stock-based
compensation expense recognized during the year includes compensation expense for all share-based payments based on the grant
date fair value estimated in accordance with the provisions in this guidance.

The fair value for options in Live Nation stock is estimated on the date of grant using the Black-Scholes option-pricing model.

The fair value of the options is amortized to expense on a straight-line basis over the options’ vesting period. Expected volatilities
established prior to 2011 were based on similar companies’ implied volatilities of traded options and historical volatilities since the
Company’s common stock did not have sufficient trading history to reasonably predict its own volatility. Starting in 2011, the
Company uses an expected volatility based on an even weighting of its own traded options and historical volatility. The Company uses
the simplified method for estimating the expected life within the valuation model which is the period of time that options granted are
expected to be outstanding. The Company uses the simplified method as it does not believe its historical experience provides a
reasonable basis with which to estimate the expected term due to the impact of a number of divestitures after the Separation, the
varying vesting terms of awards issued since the Separation and the impact from the type and amount of awards converted pursuant to
the Merger. The risk-free rate for periods within the expected life of the option is based on the United States Treasury note rate.

The fair value of restricted stock and restricted stock units is amortized to expense on a straight-line basis over the vesting

period.

Acquisition Transaction Expenses

Acquisition transaction expenses consist of direct costs related to business combinations, such as legal and accounting
transaction charges related to reviewing and closing an acquisition and also other legal costs directly tied to the transaction. These
expenses also reflect changes in the fair value of accrued acquisition-related contingent consideration arrangements. The Company
records transaction costs incurred in connection with the purchase or sale of a noncontrolling interest in a subsidiary, when control is
maintained, as a deduction from equity in additional paid-in capital.

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates, judgments, and

assumptions that affect the amounts reported in the financial statements and accompanying notes including, but not limited to, legal,
tax and insurance accruals, acquisition accounting and impairments. The Company bases its estimates on historical experience and on
various other assumptions that are believed to be reasonable under the circumstances. Actual results could differ from those estimates.

Reclassifications

Certain reclassifications have been made to the 2011 consolidated financial statements to conform to the 2012 presentation. The
Company has reclassified $35.4 million for the year ended December 31, 2011 in the results of operations for its reportable segments
as an increase to revenue and direct operating expenses in the Ticketing segment with corresponding increases to Eliminations in order
to properly break out intersegment revenues. There is no impact to the consolidated financial statements. Additionally, as of
December 31, 2011, the Company reclassified $10.4 million from other long-term assets to long-term debt to properly reflect the debt
discount related to the May 2010 senior secured credit facility.

Recent Accounting Pronouncements
Recently Adopted Pronouncements

In May 2011, the FASB issued guidance that improves comparability of fair value measurements presented and disclosed in

financial statements. This guidance clarifies the application of existing fair value measurement requirements including (1) the
application of the highest and best use and valuation premise concepts, (2) measuring the fair value of an instrument classified in a
reporting entity’s stockholders’ equity, and (3) quantitative information required for fair value measurements categorized within Level
3. It also requires additional disclosure for Level 3 measurements regarding the sensitivity of the fair value to changes in unobservable
inputs and any interrelationships between those inputs. The Company adopted this guidance on January 1, 2012 and the adoption of
this guidance did not have a material effect on its financial position or results of operations.

In July 2012, the FASB issued guidance which gives companies the option to perform a qualitative assessment to determine

79
Recently Issued Pronouncements

In February 2013, the FASB issued guidance which requires companies to disclose additional information about reclassification

adjustments, including (1) changes in accumulated other comprehensive income balances by component and (2) significant items
reclassified out of accumulated other comprehensive income. The new disclosure requirements are to be applied prospectively and are
effective for interim and annual periods beginning after December 15, 2012. The Company will adopt this guidance on January 1,
2013 and the adoption of this standard will not have a material effect on its financial position or results of operations.

NOTE 2—LONG-LIVED ASSETS
Property, Plant and Equipment

The Company tests for possible impairment of property, plant and equipment whenever events or circumstances change, such as
a significant reduction in operating cash flow or a dramatic change in the manner that the asset is intended to be used indicate that the
carrying amount of the asset may not be recoverable.

During each year presented, the Company reviewed the carrying value of certain property, plant and equipment that

management determined would, more likely than not, be disposed of before the end of their previously estimated useful lives or had an
indicator that future operating cash flows may not support their carrying value. It was determined that certain assets were impaired
since the estimated undiscounted cash flows associated with the respective asset were less than its carrying value. For the years ended
December 31, 2012, 2011 and 2010, the Company recorded an impairment charge of $4.3 million, $10.0 million and $16.4 million,
respectively, as a component of depreciation and amortization. The 2012 impairment charge was primarily related to certain leasehold
improvements and office furniture and equipment in the Artist Nation segment, an amphitheater in the Concerts segment and a
theatrical theater in other operations. The 2011 impairment charge related to two amphitheaters, a music theater and a club in the
Concerts segment. The 2010 impairment charge was primarily related to a House of Blues club in the Concerts segment and a
theatrical theater in other operations. See Note 6—Fair Value Measurements for further discussion of the inputs used to determine the
fair value.

Also during 2010, the Company recorded $4.5 million for acceleration of depreciation expense related to a change in estimate

for the CTS ticketing platform assets that are no longer in use.

80
e
r
a

s
t
e
s
s
a

e
h
t

e
m

i
t

f
o

d
o
i
r
e
p
e
h
t

r
o
s
t
n
e
m
e
e
r
g
a

e
h
t

f
o
s
e
v
i
l

e
v
i
t
c
e
p
s
e
r

e
h
t

r
e
h
t
i
e

f
o
r
e
t
r
o
h
s

e
h
t

r
e
v
o

d
e
z
i
t
r
o
m
a

e
r
a

h
c
i
h
w
s
t
e
s
s
a

e
l
b
i
g
n
a
t
n
i

d
e
v
i
l
-
e
t
i
n
i
f
e
d
s
a
h

y
n
a
p
m
o
C
e
h
T

e
h
t

s
t
n
e
s
e
r
p
e
l
b
a
t
g
n
i
w
o
l
l
o
f

e
h
T

.
s
i
s
a
b
n
o
i
t
c
u
d
o
r
p
f
o

s
t
i
n
u
r
o
e
n
i
l
-
t
h
g
i
a
r
t
s

r
e
h
t
i
e
n
o
d
e
z
i
n
g
o
c
e
r

s
i

n
o
i
t
a
z
i
t
r
o
m
a

e
h
T

.
s
w
o
l
f

h
s
a
c

e
r
u
t
u
f

s
’
y
n
a
p
m
o
C
e
h
t

o
t

e
t
u
b
i
r
t
n
o
c

o
t

d
e
t
c
e
p
x
e

:
1
1
0
2
d
n
a

2
1
0
2
,
1
3
r
e
b
m
e
c
e
D
d
e
d
n
e

s
r
a
e
y

e
h
t

r
o
f

s
t
e
s
s
a

e
l
b
i
g
n
a
t
n
i
d
e
v
i
l
-
e
t
i
n
i
f
e
d

f
o
n
o
i
t
a
z
i
t
r
o
m
a

d
e
t
a
l
u
m
u
c
c
a

d
n
a

t
n
u
o
m
a
g
n
i
y
r
r
a
c

s
s
o
r
g
e
h
t

n
i

s
e
g
n
a
h
c

l
a
t
o
T

r
e
h
t
O

s
k
r
a
m
e
d
a
r
T

d
n
a

g
n
i
m
a
n

s
t
h
g
i
r

y
g
o
l
o
n
h
c
e
T

)
s
d
n
a
s
u
o
h
t

n
i
(

e
u
n
e
V

t
n
e
m
e
g
a
n
a
m

d
n
a

s
d
l
o
h
e
s
a
e
l

e
t
e
p
m
o
c
-
n
o
N

s
t
n
e
m
e
e
r
g
a

t
n
e
i
l

r
o
d
n
e
v

s
p
i
h
s
n
o
i
t
a
l
e
r

-
e
u
n
e
v
e
R

g
n

i
t
a
r
e
n
e
g

s
t
c
a
r
t
n
o
c

)
8
5
1
,
7
6
2
(

8
6
2
,
7
9
9

6
2
4
,
4
6
2
,
1

0
9
1
,
3

)
9
3
2
,
3
(

9
2
4
,
6

)
2
2
5
,
9
(

8
9
9
,
3
2

6
7
4
,
4
1

2
0
1
,
5
9

)
7
9
7
,
1
1
(

5
0
3
,
3
8

)
8
7
8
,
0
3
(

5
2
2
,
5
1
1

7
4
3
,
4
8

)
3
3
8
,
8
6
(

0
4
7
,
5
7
1

7
0
9
,
6
0
1

)
4
1
3
,
0
3
(

4
4
3
,
5
6
3

0
3
0
,
5
3
3

8
8
5
,
2
8
4

)
5
7
5
,
2
1
1
(

3
1
0
,
0
7
3

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.

t
n
u
o
m
a
g
n
i
y
r
r
a
c

s
s
o
r
G

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
n
o
i
t
a
z
i
t
r
o
m
a
d
e
t
a
l
u
m
u
c
c
A

:
0
1
0
2
,
1
3

r
e
b
m
e
c
e
D

f
o

s
a

e
c
n
a
l
a
B

t
e
N

s
e
l
b
i
g
n
a
t
n
I
d
e
v
i
l
-
e
t
i
n
i
f
e
D

)
9
9
3
,
4
(

)
7
5
5
,
4
(

4
0
4
,
7
5

)
6
5
0
,
7
1
(

2
9
3
,
1
3

3
1

)
8
(

)
3
(

2
2
4

5
7
3
,
2

2
7
4
,
7
1

6
1

)
7
1
2
,
5
7
1
(

)
3
5
9
(

)
8
4
9
,
4
5
1
(

)
5
3
9
(

)
6
0
1
,
2
2
4
(

8
1
8
,
5
9
2
,
1

2
1
7
,
3
7
8

7
4
5
,
7

2
1
7
,
2
0
1

)
5
7
3
,
6
1
2
(

)
6
1
1
,
6
0
1
(

)
2
1
9
,
6
5
2
(

)
0
8
6
,
3
(

9
5
4
,
7
1
2

)
3
3
1
,
3
4
(

6
2
4
,
6

)
4
7
1
,
4
(

2
5
2
,
2

6
2

)
7
1
(

)
9
5
4
(

)
6
7
4
(

)
9
3
2
,
5
6
4
(

2
0
7
,
9
8
1
,
1

2
5
4
,
6

)
0
5
6
,
4
(

3
6
4
,
4
2
7

2
0
8
,
1

8
7
5
,
2

)
9
1
3
(

)
0
4
7
,
1
(

9
1
5

)
5
2
5
,
8
(

4
0
1

1
4
7
,
1

)
0
8
6
,
6
(

7
1
5
,
4
2

)
2
0
2
,
6
1
(

5
1
3
,
8

8
9
4

4
6
7
,
5

)
6
5
3
,
2
1
(

)
4
9
0
,
6
(

)
1
1
2
(

)
0
2
6
,
2
(

5
5
3
,
2
1

4
2
5
,
9

)
8
7
6
,
6
(

3
2
4
,
8
1

5
4
7
,
1
1

)
9
7
5
(

4
1
8
,
8

5
3
2
,
8

2
1
1

)
7
2
1
,
0
2
(

)
5
1
0
,
0
2
(

)
2
1
8
,
1
3
(

7
3
3
,
3
0
1

5
2
5
,
1
7

3
2
4

)
6
3
3
,
2
(

)
3
1
9
,
1
(

)
9
3
2
(

)
4
4
2
,
1
2
(

)
3
8
4
,
1
2
(

)
5
9
2
,
3
5
(

4
2
4
,
1
0
1

9
2
1
,
8
4

8
2
8
,
3

)
9
1
4
(

)
2
6
8
,
1
(

7
4
5
,
1

0
1
2

0
3
0
,
2

)
9
3
1
,
8
(

)
9
7
3
,
0
1
(

)
7
1
0
,
9
3
(

2
7
7
,
6
1
1

5
5
7
,
7
7

7
8
4
,
1

)
2
9
3
(

)
2
8
4
,
2
1
(

)
4
7
8
,
2
1
(

)
1
9
8
,
1
5
(

9
5
2
,
8
1
1

8
6
3
,
6
6

)
0
0
1
(

)
7
0
1
(

)
8
6
7
,
3
(

)
5
7
9
,
3
(

1
6

6
1
1

0
5
7

)
8
5
5
,
5
2
(

)
1
3
6
,
4
2
(

)
4
6
4
,
3
9
(

5
6
7
,
1
7
1

1
0
3
,
8
7

8
9

0
0
0
,
3

)
5
4
4
,
6
(

)
7
4
3
,
3
(

)
7
7
(

8
4
4
,
7

)
6
7
2
,
5
2
(

)
5
0
9
,
7
1
(

8
1
4
,
8
6
1

)
9
6
3
,
1
1
1
(

9
4
0
,
7
5

)
2
9
(

)
8
3
5
,
5
(

)
9
9
2
,
4
(

)
0
4
8
,
4
2
(

)
9
6
7
,
4
3
(

1
6
3

1
8
5
,
8

)
8
7
1
,
5
4
(

)
4
3
2
,
6
3
(

)
8
4
5
,
6
6
(

5
7
5
,
0
3
3

7
2
0
,
4
6
2

)
8
2
4
(

6
5
8
,
2
7

)
8
4
3
,
1
4
1
(

)
0
2
9
,
8
6
(

)
1
1
6
,
4
1
1
(

8
4
3
,
1
4
1

1
4
7
,
6
2

)
7
0
8
,
9
3
(

5
5
6
,
1
6
2

8
4
8
,
1
2
2

7
7
4
,
1
5

)
3
3
0
,
3
(

4
9
3
,
1
1

8
3
8
,
9
5

5
1
8
,
1

8
6
3
,
4

)
7
9
4
,
4
6
(

)
4
1
3
,
8
5
(

6
2
4
,
2
4
5

)
9
8
8
,
0
7
1
(

7
3
5
,
1
7
3

3
4
4
,
5

8
2
4
,
3
2

)
6
2
2
,
6
5
(

)
5
5
3
,
7
2
(

)
0
2
2
,
0
8
(

)
8
4
7
,
2
(

8
0
3
,
6
5

)
0
6
6
,
6
2
(

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
s
n
o
i
t
i
s
i
u
q
c
A

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
s
e
r
u
t
i
t
s
e
v
i
D

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
e
g
n
a
h
c
x
e

n
g
i
e
r
o
F

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.

)
1
(

r
e
h
t
O

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
:
t
n
u
o
m
a

g
n
i
y
r
r
a
c

s
s
o
r
G

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
e
s
n
e
p
x
e
n
o
i
t
a
z
i
t
r
o
m
A

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
s
e
r
u
t
i
t
s
e
v
i
D

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
e
g
n
a
h
c
x
e

n
g
i
e
r
o
F

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.

)
1
(

r
e
h
t
O

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.

:
n
o
i
t
a
z
i
t
r
o
m
a

d
e
t
a
l
u
m
u
c
c
A

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
s
n
o
i
t
i
s
i
u
q
c
A

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
e
g
n
a
h
c
x
e

n
g
i
e
r
o
F

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.

)
1
(

r
e
h
t
O

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
:
t
n
u
o
m
a

g
n
i
y
r
r
a
c

s
s
o
r
G

t
e
N

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.

t
n
u
o
m
a
g
n
i
y
r
r
a
c

s
s
o
r
G

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
n
o
i
t
a
z
i
t
r
o
m
a
d
e
t
a
l
u
m
u
c
c
A

:
1
1
0
2
,
1
3

r
e
b
m
e
c
e
D

f
o

s
a

e
c
n
a
l
a
B

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
e
s
n
e
p
x
e
n
o
i
t
a
z
i
t
r
o
m
A

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
e
g
n
a
h
c
x
e

n
g
i
e
r
o
F

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.

)
1
(

r
e
h
t
O

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.

:
n
o
i
t
a
z
i
t
r
o
m
a

d
e
t
a
l
u
m
u
c
c
A

2
2
5
,
7
1
3

t
e
N

1
7
0
,
5
1
5

)
9
4
5
,
7
9
1
(

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.

t
n
u
o
m
a
g
n
i
y
r
r
a
c

s
s
o
r
G

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
n
o
i
t
a
z
i
t
r
o
m
a
d
e
t
a
l
u
m
u
c
c
A

:
2
1
0
2
,
1
3

r
e
b
m
e
c
e
D

f
o

s
a

e
c
n
a
l
a
B

s
t
c
a
r
t
n
o
c
g
n
i
t
a
r
e
n
e
g
-
e
u
n
e
v
e
r
d
n
a

s
p
i
h
s
n
o
i
t
a
l
e
r

r
o
d
n
e
v
/
t
n
e
i
l
c

o
t

d
e
t
a
l
e
r
y
l
i
r
a
m

i
r
p
,
n
o
i
l
l
i

m
7
.
2
0
1
$
g
n
i
l
a
t
o
t

s
t
e
s
s
a

e
l
b
i
g
n
a
t
n
i
d
e
v
i
l
-
e
t
i
n
i
f
e
d
d
e
d
r
o
c
e
r
y
n
a
p
m
o
C
e
h
t

2
1
0
2
g
n
i
r
u
D

.
s
t
e
s
s
a

d
e
r
i
a
p
m

r
o
d
e
z
i
t
r
o
m
a
y
l
l
u
f

f
o
s
n
w
o
d
t
e
n
d
n
a

s
n
o
i
t
a
u
l
a
v

f
o
n
o
i
t
a
z
i
l
a
n
i
f

e
h
t

m
o
r
f
g
n
i
t
l
u
s
e
r

s
t
e
s
s
a

e
l
b
i
g
n
a
t
n
i

d
e
v
i
l
-
e
t
i
n
i
f
e
d
f
o
s
e
i
r
o
g
e
t
a
c

n
e
e
w
t
e
b

s
n
o
i
t
a
c
i
f
i
s
s
a
l
c
e
r

s
e
d
u
l
c
n
i

r
e
h
t
O

)
1
(

c
i
s
u
m
e
c
n
a
d

c
i
n
o
r
t
c
e
l
e

n
a

m
a
e
r
C

f
o
n
o
i
t
i
s
i
u
q
c
a

2
1
0
2
y
a
M

e
h
t

,
d
n
a
l
a
e
Z
w
e
N
d
n
a

a
i
l
a
r
t
s
u
A
n
i

s
s
e
n
i
s
u
b
n
o
i
t
o
m
o
r
p
t
r
e
c
n
o
c

,
l
e
p
p
o
C

f
o
n
o
i
t
i
s
i
u
q
c
a
2
1
0
2
l
i
r
p
A
e
h
t

h
t
i

w
d
e
t
a
i
c
o
s
s
a

.
e
p
o
r
u
E
n
i

d
l
e
h
l
a
v
i
t
s
e
f

o
t

s
t
h
g
i
r

f
o
e
s
a
h
c
r
u
p
e
h
t

d
n
a
m
o
d
g
n
i
K
d
e
t
i
n
U
e
h
t

n
i
d
e
s
a
b
r
e
t
o
m
o
r
p
l
a
v
i
t
s
e
f

s
n
o
i
t
i
d
d
A

.
y
g
o
l
o
n
h
c
e
t

d
n
a

s
t
c
a
r
t
n
o
c

g
n
i
t
a
r
e
n
e
g
-
e
u
n
e
v
e
r
o
t

d
e
t
a
l
e
r
y
l
i
r
a
m

i
r
p

,
n
o
i
l
l
i

m
4
.
7
5
$
g
n
i
l
a
t
o
t

s
t
e
s
s
a

e
l
b
i
g
n
a
t
n
i
d
e
v
i
l
-
e
t
i
n
i
f
e
d
d
e
d
r
o
c
e
r
y
n
a
p
m
o
C
e
h
t

1
1
0
2
g
n
i
r
u
D

h
s
i
n
a
p
S
a

,
t
e
k
c
i
t
i
v
r
e
S
f
o
n
o
i
t
i
s
i
u
q
c
a

1
1
0
2
l
i
r
p
A
e
h
t

,
a
e
r
a

o
r
t
e
m

C
D
n
o
t
g
n
i
h
s
a

e
h
t

n
i

s
s
e
n
i
s
u
b
g
n
i
t
e
k
c
i
t
y
r
a
m

i
r
p

P
L
G
T
f
o

n
o
i
t
i
s
i
u
q
c
a
1
1
0
2
y
r
a
u
n
a
J

e
h
t
o
t

d
e
t
a
l
e
r
y
l
i
r
a
m

i
r
p

f
o
r
e
p
o
l
e
v
e
d
a

,
e
n
g
a
p
m
a
h
C
g
i
B

f
o
n
o
i
t
i
s
i
u
q
c
a

1
1
0
2

r
e
b
m
e
c
e
D
e
h
t

d
n
a

a
i
n
r
o
f
i
l
a
C
n
r
e
h
t
u
o
S
n
i

r
e
t
o
m
o
r
p
a

,
s
t
r
e
c
n
o
C
S
H
N
L
f
o
n
o
i
t
i
s
i
u
q
c
a

1
1
0
2
r
e
b
o
t
c
O
e
h
t

y
n
a
p
m
o
c

g
n
i
t
e
k
c
i
t

.
s
c
i
r
t
e
m
a
i
d
e
m
g
n
i
t
u
b
i
r
t
s
i
d
d
n
a

g
n
i
z
y
l
a
n
a

,
g
n
i
t
c
e
l
l
o
c

r
o
f

s
e
i
g
o
l
o
n
h
c
e
t

The 2012 and 2011 additions to definite-lived intangible assets have weighted average lives as follows:

Weighted Average
Life (years)

2012

2011

Revenue-generating contracts .............................................
Client/vendor relationships .................................................
Non-compete agreements....................................................
Venue management and leaseholds.....................................
Technology..........................................................................
Trademarks and naming rights ............................................

All categories ......................................................................

11
9
3
-
6
10

10
8
3
6
5
-

During 2011, the Company recorded a divestiture of $4.4 million primarily relating to the sale of an artist management

company.

The Company tests for possible impairment of definite-lived intangible assets whenever events or circumstances change, such as

a significant reduction in operating cash flow or a dramatic change in the manner in which the asset is intended to be used which may
indicate that the carrying amount of the asset may not be recoverable. During all years presented, the Company reviewed the carrying
value of certain definite-lived intangible assets that management determined would not be renewed or that had an indicator that future
operating cash flows may not support their carrying value. It was determined that certain assets were impaired since the estimated
undiscounted cash flows associated with those assets were less than their carrying value. For the years ended December 31, 2012,
2011 and 2010, the Company recorded an impairment charge related to definite-lived intangible assets of $89.6 million, $14.1 million
and $17.2 million, respectively, as a component of depreciation and amortization. The 2012 impairment charge primarily related to
client/vendor relationship intangible assets in the Artist Nation segment and revenue-generating contracts and client/vendor
relationships in the Concerts segment. The 2011 impairment charge related to intangible assets for client/vendor relationships,
revenue-generating contracts and venue management and leaseholds in the Concerts segment. The 2010 impairment charge was
primarily related to intangible assets for revenue-generating contracts and trademarks and naming rights in the Concerts segment. See
Note 6—Fair Value Measurements for further discussion of these impairments and the inputs used to determine the fair value.

Total amortization expense from definite-lived intangible assets for the years ended December 31, 2012, 2011 and 2010 was

$256.9 million, $175.2 million and $151.9 million, respectively. The increase in amortization expense for the year ended
December 31, 2012 as compared to the prior year is primarily driven by amortization related to the impairment of intangible assets for
client/vendor relationships and revenue-generating contracts, additional definite-lived intangibles acquired in the acquisitions noted
above and $3.7 million related to the acceleration of amortization expense resulting from a change in the estimated useful life of a
venue management and leaseholds intangible in the Concerts segment. The increase in amortization expense for the year ended
December 31, 2011 as compared to the prior year is primarily driven by the additional definite-lived intangible assets obtained in the
Merger, the acquisition of the remaining 49% interest in, and control of, LN-Haymon and the acquisitions of Ticketnet and
Serviticket. Also adding to the increase in amortization expense for the year ended December 31, 2011 as compared to the prior year
was a $6.1 million reduction to amortization expense in 2010 related to a non-cash gain on the settlement of a pre-existing relationship
with LN-Haymon.

The following table presents the Company’s estimate of amortization expense for each of the five succeeding fiscal years for

definite-lived intangible assets that exist at December 31, 2012:

2013 .............................................................................. $
2014 .............................................................................. $
2015 .............................................................................. $
2016 .............................................................................. $
2017 .............................................................................. $

(in thousands)
135,355
136,949
99,967
89,968
92,440

As acquisitions and dispositions occur in the future and the valuations of intangible assets for recent acquisitions are completed,

amortization expense may vary.

Indefinite-lived Intangibles

The Company has indefinite-lived intangible assets which consist primarily of the intangible value related to trade names. These

indefinite-lived intangible assets had a carrying value of $377.5 million and $377.2 million as of December 31, 2012 and 2011,
respectively.

The Company tests for possible impairment of indefinite-lived intangible assets on at least an annual basis. During 2010, the

Company determined that certain indefinite-lived intangible assets were impaired since the estimated fair value associated with those
assets was less than its carrying value. For the year ended December 31, 2010, the Company recorded an impairment related to
indefinite-lived intangible assets of $10.0 million, which is included in depreciation and amortization in the Ticketing segment. See
Note 6—Fair Value Measurements for further discussion of the inputs used to determine the fair value. There were no impairment
charges recorded for the years ended December 31, 2012 and 2011.

Goodwill

The following table presents the changes in the carrying amount of goodwill in each of the Company’s reportable segments for

the years ended December 31, 2012 and 2011:

Concerts

Ticketing

Artist
Nation

eCommerce

(in thousands)

Sponsorship
& Advertising

Other

Total

375,487

557,856

$ 267,992

214,927

80,056 $

13,037

1,509,355

(269,902)

105,585

557,856

267,992

214,927

(13,037)

80,056

(282,939)

1,226,416

47,086

(214,927)

167,841

Balance as of December 31,

2010:

Goodwill ........................ $
Accumulated

impairment losses....

Net

Recast balances (1):
Fair value approach .......

Recast Balance as of January 1,
2011: ....................................
Goodwill ........................
Accumulated

impairment losses....

Net

Acquisitions - current

year ..........................

Acquisitions - prior

year ..........................
Dispositions ...................
Foreign exchange ..........

Balance as of December 31,

2011:

Goodwill ........................
Accumulated

impairment losses....

Net

Acquisitions - current

year ..........................

Acquisitions - prior

year ..........................
Foreign exchange ..........

Balance as of December 31,

2012:

Goodwill ........................
Accumulated

375,487

604,942

267,992

(269,902)

105,585

604,942

267,992

15,040

27,590

1,836

2
-
(3,341)

2,956
-
(1,636)

(7,523)
(147)
-

387,188

633,852

262,158

(269,902)

117,286

633,852

262,158

71,942

-
9,761

2,380
1,410

4,542
120

468,891

637,642

266,820

-
-
-

-
-

247,897

13,037

1,509,355

(13,037)

247,897

-
-
(3,549)

-
-
-

(282,939)

1,226,416

44,466

(4,565)
(147)
(8,526)

244,348

13,037

1,540,583

(13,037)

244,348

-
10,028

-
-

(282,939)

1,257,644

71,942

6,922
21,319

254,376

13,037

1,640,766

(13,037)

(282,939)

254,376 $

1,357,827

impairment losses....

(269,902)

Net

198,989

637,642

$ 266,820

(1) The beginning balance for the eCommerce segment has been recast to allocate goodwill to the Ticketing and Sponsorship &

Advertising segments. The total consolidated amount remained unchanged.

Included in the current year acquisitions amount above for 2012 is $71.9 million of goodwill primarily related to the acquisitions

of Coppel and Cream.

Included in the current year acquisitions amount above for 2011 is $44.5 million of goodwill primarily related to the acquisitions

of Serviticket, LN-HS Concerts and BigChampagne.

Of the total amount of goodwill recognized in connection with the 2012 and 2011 acquisitions, none is expected to be deductible

for tax purposes.

The Company reviews for possible impairment of goodwill annually. There was no impairment charge recorded for the years

ended December 31, 2012, 2011 and 2010.

The Company is in the process of finalizing its acquisition accounting for recent smaller acquisitions which could result in a

change to the relevant purchase price allocations including goodwill.

Long-Lived Asset Disposals

In January 2012, the Company completed the sale of an amphitheater in Ohio. In January 2011, the Company sold its 50%

controlling interest in an artist management company. In May 2011, the Company completed the sale of the Selma amphitheater in
Texas.

In connection with the Merger, the Company reached an agreement with the DOJ that Ticketmaster would divest its Paciolan

ticketing business and, in March 2010, the Company completed this sale to Comcast-Spectacor, L.P. In December 2010, the Company
also sold a music theater in Sweden and an indoor Latin/salsa event in the Netherlands.

The table below summarizes the asset and liability values at the time of disposal and the resulting gain or loss recorded.

Divested Asset

Segment

Gain (Loss)
on Sale of
Operating
Assets

Current
Assets

Noncurrent
Assets
(in thousands)

Current
Liabilities

Noncurrent
Liabilities

2012 Divestiture
Ohio amphitheater................................

Concerts

444 $

- $

5,400 $

444 $

2011 Divestiture
Texas amphitheater ..............................
$
Artist management company ............... Artist Nation $

Concerts

798 $
(1,264) $

- $
3 $

3,206 $
4,153 $

- $
119 $

-
-

2010 Divestiture
Paciolan................................................
Sweden music theater ..........................
Latin/salsa event ..................................

Discontinued Operations

Ticketing
Concerts
Concerts

$
$
$

(5,218) $
3,094 $
(67) $

8,357 $
(1,258) $
408 $

33,492 $
15,502 $
8 $

7,595 $
3,847 $
348 $

6,364
-
-

For the year ended December 31, 2010, the Company reported $4.2 million of expense, net of tax, related to the 2009 sale of its

remaining theatrical venues and operations in the United Kingdom.

Certain agreements relating to disposals of businesses provide for future contingent consideration to be paid to the Company
based on the financial performance of the businesses sold. The Company will record additional amounts related to such contingent
consideration, with a corresponding adjustment to gain (loss) on sale of operating assets, if and when it is determinable that the
applicable financial performance targets will be met. The aggregate of these contingent considerations, if all existing performance
targets are met, would not significantly impact the results of operations of the Company. The last contingency period for which the
Company has outstanding contingent consideration is for the year ended December 31, 2013.

NOTE 3—ACQUISITIONS

During 2012, the Company completed its acquisitions of Coppel, Cream, HARD and other smaller acquisitions. These

acquisitions were accounted for as business combinations under the acquisition method of accounting and were not considered
significant on an individual basis or in the aggregate.

During 2011, the Company completed its acquisitions of TGLP, LN Ontario Concerts, Serviticket, Jeff Battaglia Management,

LLC, Full Circle, LN-HS Concerts, T-Shirt Printers and BigChampagne. These acquisitions were accounted for as business
combinations under the acquisition method of accounting and were not considered significant on an individual basis or in the
aggregate.

Front Line

In the first quarter of 2011, the Company acquired all of the remaining equity interests of Front Line that it did not previously

own in a series of transactions. As a result of these transactions, the Company was able to further simplify its operating structure and it
has achieved or expects to achieve future savings through reduced cash taxes, noncontrolling interest distributions and other synergies.

Under the terms of the stock purchase agreement, the Company purchased all restricted and unrestricted shares of common
stock of Front Line held by Irving Azoff and the Azoff Trust (collectively the “Azoff Sellers”), purchased all in-the-money options for
common stock of Front Line held by the Azoff Sellers and purchased all shares of common stock of Front Line held by MSG. Irving
Azoff was the Company’s Executive Chairman and Chairman of the board of directors until his resignation as officer, director and
employee of the Company on December 31, 2012. The Company also paid an amount equal to the 2010 dividend paid by Front Line
to the Azoff Sellers and MSG, pro-rated for the period from January 1, 2011 through the closing date, and paid Mr. Azoff a
contractually-owed tax gross-up associated with his restricted Front Line common stock and dividend. In total, under the stock
purchase agreement, the Company paid $56.3 million in cash and $18.6 million in newly-issued shares of Live Nation common stock
to the Azoff Sellers and $0.2 million in cash and $41.0 million in newly issued shares of Live Nation common stock to MSG. These
shares were valued using the closing price of the Company’s stock on the date of the transaction. Of the total shares of Live Nation
stock issued, the Azoff Sellers received 1.8 million shares of common stock and MSG received 3.9 million shares of common stock.

As part of individual redemption agreements, the Company also purchased the remaining smaller holdings of outstanding Front

Line restricted shares of common stock from other individuals for a total of $12.8 million in cash.

The shares purchased under all of these agreements had redemption features and, previous to these repurchases, the Azoff

Sellers’ and MSG’s common shares and the Azoff Sellers’ options were classified as redeemable noncontrolling interests and all of
the remaining shares were classified as liabilities. All of these instruments were carried at their fair values and amounts paid as part of
these agreements were recorded in the income statement to the extent they were in excess of the amount recorded on the balance sheet,
with the exception of the unrestricted shares of common stock held by the Azoff Sellers and MSG which were accounted for as the
acquisition of noncontrolling interests and the difference between the carrying value and settlement value was recorded in additional
paid-in capital. Tax gross-up amounts paid were recorded in the income statement to the extent the amount paid exceeded the amount
already accrued. As a result of the repurchases, the Company recorded $24.4 million in selling, general and administrative expenses in
the first quarter of 2011, which is classified as stock-based compensation. Further, cash flows from financing activities reflects a $47.9
million use of cash and cash flows from operating activities reflects a $21.4 million use of cash as a result of these transactions. Total
non-cash consideration was $59.6 million and is not included in the statement of cash flows.

Merger with Ticketmaster

Description of Transaction

In January 2010, Live Nation completed the merger of Ticketmaster with and into a wholly-owned subsidiary of Live Nation

pursuant to the Merger Agreement. In connection with the Merger, each issued and outstanding share of Ticketmaster common stock
was cancelled and converted into the right to receive 1.4743728 shares of Live Nation common stock plus cash in lieu of any
fractional shares such that Ticketmaster stockholders received approximately 50.01% of the voting power of the combined company.

The combination of Live Nation and Ticketmaster was structured as a merger of equals. The Merger was accounted for as a

business combination under the acquisition method of accounting in accordance with GAAP. Live Nation was the deemed
“accounting acquirer” of Ticketmaster for accounting purposes.

86
Actual and Pro Forma Impact of Acquisition

The revenue, income from continuing operations and net income of Ticketmaster that are included in the Company’s 2010
statement of operations since the Merger are detailed below. These amounts are not necessarily indicative of the results of operations
that Ticketmaster would have realized if it had continued to operate as a stand-alone company during the period presented primarily
due to the elimination of certain headcount and administrative costs since the Merger that are the result of synergy impacts or due to
costs that are now reflected by the Company in its results of operations and not allocated to Ticketmaster.

Revenue
Income from continuing operations
Net income attributable to common
stockholders of Live Nation
Entertainment, Inc.

$
$

From the Merger
Date through
December 31, 2010
(in thousands)

1,246,546
47,722

47,124

The following unaudited pro forma information presents the consolidated results of Live Nation and Ticketmaster for the year
ended December 31, 2010, with adjustments to give effect to pro forma events that are directly attributable to the Merger and have a
continuing impact, as well as to exclude the impact of pro forma events that are directly attributable to the Merger and are one-time in
nature. The unaudited pro forma information is presented for illustrative purposes only and is not necessarily indicative of the results
of operations of future periods or the results of operations that actually would have been realized had the entities been a single
company during the periods presented or the results that the combined company will experience after the Merger. The unaudited pro
forma information does not give effect to the potential impact of current financial conditions, regulatory matters or any anticipated
synergies, operating efficiencies or cost savings that may be associated with the Merger. The unaudited pro forma information also
does not include any integration costs, dis-synergies or remaining future transaction costs that the companies may incur related to the
Merger as part of combining the operations of the companies.

The unaudited pro forma consolidated results of operations for the year ended December 31, 2010, assuming the acquisition had

occurred on January 1, 2009 are as follows:

Unaudited pro forma consolidated results:

Revenue...................................................... $
Loss from continuing operations................ $
Net loss attributable to common
stockholders of Live Nation
Entertainment, Inc. ................................ $

(in thousands)

5,089,110
(156,026)

(179,656)

The Company has incurred a total of $70.0 million of acquisition transaction expenses to date relating to the Merger, of which
$1.2 million, $16.9 million and $17.0 million are included in the results of operations for the years ended December 31, 2012, 2011
and 2010, respectively. For the years ended December 31, 2012 and 2011, these expenses were primarily the result of litigation costs
relating to the Merger. The Company has incurred a total of $3.0 million of equity issuance costs to date related to the Merger which
have been recorded as a charge to additional paid-in capital, as a reduction of the otherwise determined fair value of the equity issued.

In connection with the Merger, the Company incurred severance costs of $8.1 million, $1.2 million and $0.1 million as a
component of selling, general and administrative expenses in its Ticketing, Artist Nation and Sponsorship & Advertising segments,
respectively, and $4.7 million as a component of corporate expenses for the year ended December 31, 2010. As of December 31, 2012
and 2011, the accrual balance for the Merger restructuring was $0.1 million and $0.4 million, respectively. The Company did not incur
additional severance costs in 2012 or 2011.

NOTE 4—LONG-TERM DEBT

Long-term debt, which includes capital leases, at December 31, 2012 and 2011, consisted of the following:

December 31,

2012

2011

(in thousands)

May 2010 Senior Secured Credit Facility:

Term loan A, net of unamortized discount of $0.9 million and $1.2 million at December 30,

2012 and 2011, respectively ........................................................................................................ $

76,556 $

86,341

Term loan B, net of unamortized discount of $14.1 million and $12.2 million at December 31,

2012 and 2011, respectively ........................................................................................................
Revolving credit facility ...................................................................................................................
7% Senior Notes due 2020.........................................................................................................................
8.125% Senior Notes due 2018..................................................................................................................
10.75% Senior Notes due 2016, plus unamortized premium of $18.7 million at December 31, 2011 ......
2.875% Convertible Senior Notes due 2027, net of unamortized discount of $20.6 million and $32.4

million at December 31, 2012 and 2011, respectively

Other long-term debt..................................................................................................................................

Less: current portion ..................................................................................................................................

863,370
-
225,000
250,000
-

199,419
125,660
1,740,005
62,050

773,773
-
-
250,000
305,649

187,627
101,871
1,705,261
52,632

Total long-term debt, net............................................................................................................................ $ 1,677,955 $ 1,652,629

Future maturities of long-term debt at December 31, 2012 are as follows:

2013 .......................................................................... $
2014 ..........................................................................
2015 ..........................................................................
2016 ..........................................................................
2017 ..........................................................................
Thereafter..................................................................
Total..........................................................................
Debt discount ............................................................
Total including discount ........................................... $

(in thousands)

62,050
263,241
80,777
875,113
1,567
492,912
1,775,660
(35,655)
1,740,005

All long-term debt without a stated maturity date is considered current and is reflected as maturing in the earliest period shown

in the table above. See Note 6—Fair Value Measurements for discussion of fair value measurement of the Company’s long-term debt.

May 2010 Senior Secured Credit Facility

Pursuant to the terms of the Company’s senior secured credit facility described below, subject to certain conditions, the
Company had the right to increase its original term loan facilities by up to $300 million in the aggregate. In August 2012, the
Company exercised the right and entered into an Incremental Term Loan Joinder Agreement that increased the existing term loan B
borrowings by $100 million.

At December 31, 2012, the Company’s senior secured credit facility, dated as of May 6, 2010, consists of (i) a $100 million

term loan A with a maturity of five and one-half years, (ii) a $900 million term loan B with a maturity of six and one-half years and
(iii) a $300 million revolving credit facility with a maturity of five years. In addition, subject to certain conditions, the Company has
the right to increase such facilities by up to $200 million in the aggregate. The five-year revolving credit facility provides for
borrowings up to the amount of the facility with sublimits of up to (i) $150 million to be available for the issuance of letters of credit,
(ii) $50 million to be available for swingline loans and (iii) $100 million to be available for borrowings in foreign currencies. The
senior secured credit facility is secured by a first priority lien on substantially all of the Company’s domestic wholly-owned
subsidiaries and on 65% of the capital stock of the Company’s wholly-owned foreign subsidiaries.

The interest rates per annum applicable to loans under the senior secured credit facility are, at the Company’s option, equal to

either LIBOR plus 3.25% or a base rate plus 2.25%, subject to stepdowns based on the Company’s leverage ratio. The interest rate for
the term loan B is subject to a LIBOR floor of 1.5% and a base rate floor of 2.5%. The Company is required to pay a commitment fee
of 0.5% per year on the undrawn portion available under the revolving credit facility and variable fees on outstanding letters of credit.

For the term loan A, the Company is required to make quarterly payments ranging from $1.25 million to $10 million with the
balance due at maturity in November 2015. For the term loan B, the Company is now required to make quarterly payments of $2.25
million with the balance due at maturity in November 2016. The Company is also required to make mandatory prepayments of the
loans under the credit agreement, subject to specified exceptions, from excess cash flow, and with the proceeds of asset sales, debt
issuances and specified other events.

Based on the Company’s outstanding letters of credit of $63.9 million, $236.1 million was available for future borrowings under

the revolving credit facility.

7% Senior Notes

In August 2012, the Company issued $225 million of 7% senior notes due 2020. Interest on the notes is payable semi-annually
in cash in arrears on March 1 and September 1 of each year, beginning on March 1, 2013, and the notes will mature on September 1,
2020. The Company may redeem some or all of the notes at any time prior to September 1, 2016 at a price equal to 100% of the
aggregate principal amount, plus any accrued and unpaid interest to the date of redemption, plus a ‘make-whole’ premium using a
discount rate equal to the Treasury Rate plus 50 basis points. The Company may also redeem up to 35% of the notes from the
proceeds of certain equity offerings prior to September 1, 2015, at a price equal to 107% of the principal amount, plus any accrued and
unpaid interest. In addition, on or after September 1, 2016, the Company may redeem at its option some or all of the notes at
redemption prices that start at 103.5% of their principal amount, plus any accrued and unpaid interest to the date of redemption. The
Company must make an offer to redeem the notes at 101% of the aggregate principal amount, plus accrued and unpaid interest to the
repurchase date, if it experiences certain defined changes of control.

The indentures governing the notes contain covenants that limit, among other things, the Company’s ability, and the ability of its

restricted subsidiaries, to incur certain additional indebtedness and issue preferred stock; make certain distributions, investments and
other restricted payments; sell certain assets; agree to any restrictions on the ability of restricted subsidiaries to make payments to the
Company; create certain liens; merge, consolidate or sell substantially all of the Company’s assets; or enter into certain transactions
with affiliates.

8.125% Senior Notes

In May 2010, the Company issued $250 million of 8.125% senior notes due 2018. Interest on the notes is payable semi-annually
in cash in arrears on May 15 and November 15 of each year, beginning on November 15, 2010, and the notes will mature on May 15,
2018. The Company may redeem some or all of the notes at any time prior to May 15, 2014 at a price equal to 100% of the principal
amount, plus any accrued and unpaid interest to the date of redemption, plus a ‘make-whole’ premium using a discount rate equal to
the Treasury Rate plus 50 basis points. The Company may also redeem up to 35% of the notes from the proceeds of certain equity
offerings prior to May 15, 2013, at a price equal to 108.125% of their principal amount, plus any accrued and unpaid interest. In
addition, on or after May 15, 2014, the Company may redeem some or all of the notes at any time at redemption prices that start at
104.063% of their aggregate principal amount. The Company must also offer to redeem the notes at 101% of their principal amount,
plus accrued and unpaid interest to the repurchase date, if it experiences certain kinds of changes of control.

2.875% Convertible Senior Notes

In July 2007, the Company issued $220 million of convertible senior notes due 2027. The notes pay interest semiannually at a
rate of 2.875% per annum. Beginning with the period commencing on July 20, 2014 and ending on January 14, 2015, and for each of
the interest periods commencing thereafter, the Company will pay contingent interest on the notes if the average trading price of the
notes during the five consecutive trading days ending on the second trading day immediately preceding the first day of the applicable
interest period equals or exceeds 120% of the principal amount of the notes. The contingent interest payable per note will equal
0.25% per year of the average trading price of such note during the applicable five trading-day reference period, payable in arrears.
The notes will be convertible, under certain circumstances, at an initial conversion rate of 36.8395 shares per $1,000 principal amount
of notes, which represents a 27.5% conversion premium based on the last reported sale price of $21.29 per share on July 10, 2007.
Upon conversion, the notes may be settled in shares of Live Nation common stock or, at the Company’s election, cash or a
combination of cash and shares of Live Nation common stock. Assuming the Company fully settled the notes in shares, the maximum
number of shares that could be issued to satisfy the conversion is 8.1 million.

89
Holders of the 2.875% convertible senior notes may require the Company to purchase for cash all or a portion of their notes on

July 15, 2014, July 15, 2017 and July 15, 2022 at a price equal to 100% of the principal amount plus accrued and unpaid interest, if
any, subject to specified additional conditions. In addition, if the Company experiences a fundamental change, as defined in the
indenture governing the notes, holders may require the Company to purchase for cash all or a portion of their notes, subject to
specified exceptions, at a price equal to 100% of the principal amount of the notes plus accrued and unpaid interest, if any. Due to its
legal structure, the Merger was not considered a fundamental change under these covenants.

On or after July 20, 2014, the Company may redeem all or a portion of the notes for cash at a price equal to 100% of the

principal amount being redeemed plus accrued and unpaid interest, if any.

As of December 31, 2012 and 2011, the carrying amount of the equity component of the notes was $73.0 million. As of
December 31, 2012 and 2011, the principal amount of the liability component (face value of the notes) was $220.0 million in each of
the respective periods. As of December 31, 2012 the remaining period over which the discount will be amortized is approximately two
years. At December 31, 2012, the value of the notes, if converted and fully settled in shares, does not exceed the principal amount of
the notes. For the years ended December 31, 2012, 2011 and 2010, the effective interest rate on the liability component of the notes
was 9.7%. The following table summarizes the amount of pre-tax interest cost recognized on the notes:

Interest cost recognized relating to:

Contractual interest coupon ....................... $
Amortization of debt discount ...................
Amortization of debt issuance costs ..........

Total interest cost recognized on the notes.......... $

2012

Year Ended December 31,
2011
(in thousands)

2010

6,325
11,792
703
18,820

6,325
10,700
703
17,728

6,325
9,710
703
16,738

See Note 5—Derivative Instruments for discussion on the accounting for derivative instruments embedded within the 2.875%

convertible senior notes.

Other Long-term Debt

Other long-term debt is comprised of capital leases of $12.4 million and notes payable and other debt of $113.3 million,

including debt to noncontrolling interest partners of $24.5 million, debt related to the redevelopment of the O2 Dublin of $13.0 million,
$40.4 million of long-term debt for AMG which consists of term loans and shareholder loan notes and $31.1 million of long-term debt
for the Company’s Australian operations. Total notes payable consist primarily of seventeen notes with interest rates ranging from
0.4% to 11.0% and maturities of up to nine years.

Debt Extinguishment

In August 2012, the proceeds from the issuance of the 7% senior notes and increased term loan B borrowings were used to repay

all of the Company’s outstanding 10.75% senior notes with a principal amount of $287 million, to pay related redemption premium
and accrued interest of $19.5 million and to pay related fees and expenses of $6.1 million, leaving $12.4 million in additional cash
available for general corporate purposes. The gain on extinguishment of debt resulting from these transactions was not significant.

The December 2005 senior secured credit facility and the Ticketmaster senior secured credit facility were paid in full in May

2010 with proceeds from the May 2010 senior secured credit facility and the issuance of the 8.125% senior notes. In addition, the
interest rate swap agreements affiliated with the December 2005 senior secured credit facility were settled in conjunction with the
termination of the prior credit facility. See Note 5—Derivative Instruments for further discussion of the interest rate swap settlements.
Also, the Company converted the existing preferred stock of one of its subsidiaries with an aggregate liquidation preference of $40
million into the right to receive a cash payment of the outstanding principal and a make-whole payment to compensate the holders for
their interest through maturity and settled this obligation. The preferred stock accrued dividends at 13% per annum and was
mandatorily redeemable on December 21, 2011. Finally, the Company expensed the deferred debt issuance costs associated with the
December 2005 senior secured credit facility and preferred stock. The Company recorded a total of $21.2 million for the loss on
extinguishment of debt in the second quarter of 2010.

December 2005 Senior Secured Credit Facility
The Company had a senior secured credit facility that was entered into in December 2005 which consisted of term loans totaling

$550 million and a $285 million revolving credit facility. Under the senior secured credit facility, revolving loans bore interest at an
annual rate of LIBOR plus 2.25% and term loans bore interest at an annual rate of LIBOR plus 3.25%.

The interest rate paid on the Company’s $285 million, multi-currency revolving credit facility depended on its total leverage

ratio. In addition to paying interest on outstanding principal under the credit facility, the Company was required to pay a commitment
fee to the lenders under the revolving credit facility in respect of the unutilized commitments. The Company was also required to pay
customary letter of credit fees, as necessary.

Ticketmaster Senior Secured Credit Facility
As part of the Merger, the Company acquired the Ticketmaster senior secured credit facility, which consisted of a $100 million

term loan A, a $350 million term loan B and a $200 million revolving credit facility.

The interest rates per annum applicable to loans under the Ticketmaster senior secured credit facility at the Merger date were a
base rate plus an applicable margin in the case of term loan A and the revolving credit facility and 4.5% per annum plus LIBOR for
term loan B. The base rate was the greater of (i) the prime rate as quoted from time to time by JPMorgan Chase Bank, N.A. or (ii) the
Federal Funds rate plus 0.5%. At the Merger date, the base rate was 2.5%.

Debt Covenants

The Company’s senior secured credit facility, which was entered into in May 2010, and further amended in June 2012, contains
a number of covenants and restrictions that, among other things, require the Company to satisfy certain financial covenants and restrict
the Company’s and its subsidiaries’ ability to incur additional debt, make certain investments and acquisitions, repurchase its stock
and prepay certain indebtedness, create liens, enter into agreements with affiliates, modify the nature of its business, enter into sale-
leaseback transactions, transfer and sell material assets, merge or consolidate, and pay dividends and make distributions (with the
exception of subsidiary dividends or distributions to the parent company or other subsidiaries on at least a pro-rata basis with any
noncontrolling interest partners). Non-compliance with one or more of the covenants and restrictions could result in the full or partial
principal balance of the credit facility becoming immediately due and payable. The senior secured credit facility agreement has two
covenants measured quarterly that relate to total leverage and interest coverage. The consolidated total leverage covenant requires the
Company to maintain a ratio of consolidated total debt to consolidated EBITDA (both as defined in the credit agreement) of 4.5x over
the trailing four consecutive quarters through December 31, 2013. The total leverage ratio will reduce to 4.25x on March 31, 2014,
4.0x on March 31, 2015, and 3.75x on March 31, 2016. The consolidated interest coverage covenant requires us to maintain a
minimum ratio of consolidated EBITDA to consolidated interest expense (both as defined in the credit agreement) of 3.0x over the
trailing four consecutive quarters.

The indentures governing the 7% senior notes and the 8.125% senior notes contain covenants that limit, among other things, the
Company’s ability and the ability of its restricted subsidiaries to incur certain additional indebtedness and issue preferred stock; make
certain distributions, investments and other restricted payments; sell certain assets; agree to any restrictions on the ability of restricted
subsidiaries to make payments to the Company; merge, consolidate or sell all of the Company’s assets; create certain liens; and
engage in transactions with affiliates on terms that are not arm’s length. Certain covenants, including those pertaining to incurrence of
indebtedness, restricted payments, asset sales, mergers and transactions with affiliates will be suspended during any period in which
the notes are rated investment grade by both rating agencies and no default or event of default under the indentures has occurred and is
continuing. The 7% senior notes and the 8.125% senior notes each contain two incurrence-based financial covenants, as defined,
requiring a minimum fixed charge coverage ratio of 2.0 to 1.0 and a maximum secured indebtedness leverage ratio of 2.75 to 1.0.

Some of the Company’s other subsidiary indebtedness includes restrictions on entering into various transactions, such as

acquisitions and disposals, and prohibits payment of ordinary dividends. They also have financial covenants including minimum
consolidated EBITDA to consolidated net interest payable, minimum consolidated cash flow to consolidated debt service and
maximum consolidated debt to consolidated EBITDA, all as defined in the applicable debt agreements.

At December 31, 2012, the Company was in compliance with all debt covenants. The Company expects to remain in compliance

with all of these covenants throughout 2013.

NOTE 5—DERIVATIVE INSTRUMENTS

The Company primarily uses forward currency contracts and options to reduce its exposure to foreign currency risk associated
with short-term artist fee commitments. The Company also enters into forward currency contracts to minimize the risks and/or costs
associated with changes in foreign currency rates on forecasted operating income and short-term intercompany loans. At
December 31, 2012 and 2011, the Company had forward currency contracts and options outstanding with notional amounts of $100.0
million and $32.5 million, respectively. These instruments have not been designated as hedging instruments. Any change in fair value
is reported in earnings during the period of the change. The Company’s foreign currency derivative activity, including the related fair
values, are not material to any period presented.

91
Additionally, the Company has entered into certain interest rate swaps and cap agreements to limit its exposure to variable

interest rates, related to portions of the Company’s outstanding debt, some of which have been designated as cash flow hedges. At
December 31, 2012 and 2011, the Company had interest rate swaps and cap agreements outstanding with notional amounts of $133.8
million and $131.0 million, respectively. In May 2010, in conjunction with the refinancing of certain of its debt arrangements, the
Company settled three interest rate swap agreements, one of which was designated as a cash flow hedge, that were associated with the
term loans under the Company’s December 2005 senior secured credit facility. The Company recognized expense of $4.5 million for
the settlement of the interest rate swap agreements as a component of loss on extinguishment of debt. Excluding the debt
extinguishment settlements, the Company’s interest rate swaps and cap activity, including the related fair values, are not material to
any period presented.

As of December 31, 2012 and 2011, there is no ineffective portion or amount excluded from effectiveness testing for derivatives

designated as cash flow hedging instruments.

The Company’s 2.875% convertible senior notes issued in July 2007 include certain provisions which are bifurcated from the
notes and accounted for as derivative instruments. At the date of issuance and as of December 31, 2012 and 2011, the fair value of
these provisions was considered to be de minimis.

The Company does not enter into derivative instruments for speculation or trading purposes and does not anticipate any
significant recognition of derivative activity through the income statement in the future related to the instruments currently held. See
Note 6—Fair Value Measurements for further discussion and disclosure of the fair values for the Company’s derivative instruments.

NOTE 6—FAIR VALUE MEASUREMENTS

The Company currently has various financial instruments carried at fair value, such as marketable securities, derivatives and

contingent consideration, but does not currently have nonfinancial assets and nonfinancial liabilities that are required to be measured
at fair value on a recurring basis. The Company’s financial assets and liabilities are measured using inputs from all levels of the fair
value hierarchy as defined in the FASB guidance for fair values. For this categorization, only inputs that are significant to the fair
value are considered. The three levels are defined as follows:

Level 1—Inputs are unadjusted quoted prices in active markets for identical assets or liabilities that can be accessed at the

measurement date.

Level 2—Inputs include quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar

assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability (i.e.,
interest rates, yield curves, etc.) and inputs that are derived principally from or corroborated by observable market data by correlation
or other means (i.e., market corroborated inputs).

Level 3—Unobservable inputs that reflect assumptions about what market participants would use in pricing the asset or liability.

These inputs would be based on the best information available, including the Company’s own data.

92
In accordance with the fair value hierarchy described above, the following table shows the fair value of the Company’s financial

assets and liabilities that are required to be measured at fair value on a recurring basis, as of December 31, 2012 and 2011, which are
classified on the balance sheets as cash and cash equivalents, other current assets, other long-term assets, other current liabilities and
other long-term liabilities:

Fair Value Measurements
at December 31, 2012
Level 2

Level 3

Level 1

(in thousands)

Total

Level 1

Fair Value Measurements
at December 31, 2011
Level 2

Level 3

(in thousands)

Total

Assets:

Cash equivalents.............. $ 61,996
Forward currency

contracts......................
Interest rate cap ...............
Stock options ...................
Total ................................ $ 61,996 $

-
-
-

- $

- $ 61,996 $ 138,537 $

- $

- $ 138,537

81
-
-
81 $

-
-
204
204 $ 62,281 $ 138,537 $

81
-
204

-
-
-

355
7
-
362 $

-
355
-
7
1,060
1,060
1,060 $ 139,959

Liabilities:

Interest rate swaps ........... $
Forward currency

contracts......................
Contingent consideration.
Total ................................ $

- $

2,811 $

- $

2,811 $

- $

3,037 $

- $

3,037

-
-
- $

625
-
3,436 $

-
6,718
6,718 $ 10,154 $

625
6,718

-
-
- $

-
-
3,037 $

-
8,363
8,363 $

-
8,363
11,400

Cash equivalents consist of money market funds. Fair values for cash equivalents are based on quoted prices in an active market.

Fair values for forward currency contracts are based on observable market transactions of spot and forward rates. Fair values for the
interest rate swaps and the interest rate cap are based on inputs corroborated by observable market data with similar tenors.

The Company has certain contingent consideration obligations related to acquisitions which are measured at fair value using
Level 3 inputs. The amounts due to the sellers are based on the achievement of agreed-upon financial performance metrics by the
acquired companies where the contingent obligation is either earned or not earned. The Company records the liability at the time of
the acquisition based on management’s best estimates of the future results of the acquired companies compared to the agreed-upon
metrics. Subsequent to the date of acquisition, the Company updates the original valuation to reflect current projections of future
results of the acquired companies and the passage of time. Accretion of, and changes in the valuations of contingent consideration are
reported in acquisition transaction expenses. During the year ended December 31, 2012, the Company recognized a decrease of $1.6
million for its contingent consideration obligations primarily due to changes in earnings from artist relationships and a payment of an
obligation. During the year ended December 31, 2011, the Company recognized a decrease of $7.6 million for its contingent
consideration obligations primarily driven by a reduction in earnings from certain artist relationships and the timing of key artist tours
partially offset by a new contingent obligation resulting from the acquisition of LN-HS Concerts. See Note 7—Commitments and
Contingent Liabilities for additional information related to the contingent payments.

The Company has stock options in a company that became publicly-traded in the third quarter of 2011 which are measured at
fair value using Level 3 inputs. The stock options were received as consideration in connection with a licensing agreement entered
into by a subsidiary of the Company and became fully-vested in the second quarter of 2011. The Company has recorded an asset for
these options which was valued using the Black-Scholes option pricing model. The Company has recorded revenue based on the
valuation of the options as of the measurement date, which was the vesting date. The changes in the valuation after the measurement
date are recorded in other expense (income), net.

Due to the short maturity, the carrying amounts of cash and cash equivalents, accounts receivable, accounts payable and accrued

expenses approximated their fair values at December 31, 2012 and 2011.

The Company’s outstanding debt held by third-party financial institutions is carried at cost, adjusted for premiums or discounts.

The Company’s debt is not publicly-traded and the carrying amounts typically approximate fair value for the Company’s debt that
accrues interest at a variable rate, which are considered to be Level 2 inputs. The estimated fair values of the 7% senior notes, the
8.125% senior notes and the 2.875% convertible senior notes were $236.3 million, $273.4 million and $219.4 million at December 31,
2012, respectively. The estimated fair values of the 8.125% senior notes, the 10.75% senior notes and the 2.875% convertible senior
notes were $243.3 million, $306.4 million and $193.6 million at December 31, 2011, respectively. See Note 4—Long-term Debt for
discussion of the issuance of the 7% senior notes and redemption of the 10.75% senior notes. The estimated fair value of the

Company’s third-party fixed-rate debt is based on quoted market prices in active markets for the same or similar debt, which are
considered to be Level 2 inputs. The Company has fixed rate debt held by noncontrolling interest partners with a face value of $24.5
million and $26.0 million at December 31, 2012 and 2011, respectively. The Company is unable to determine the fair value of this
debt.

The following table shows the fair value of the Company’s financial assets that have been adjusted to fair value on a non-

recurring basis which had a significant impact on the Company’s results of operations for the years ended December 31, 2012 and
2011:

Description

2012 Impairments

Fair Value
Measurement
As Of
December 31

Fair Value Measurements Using
Level 3
Level 2
Level 1
(in thousands)

Total
Losses

Property, plant and equipment........................................ $
Definite-lived intangible assets, net ............................... $
2012 Total ............................................................

2011 Impairments

Property, plant and equipment........................................ $
Definite-lived intangible assets, net ............................... $
2011 Total ............................................................

5,983 $
90,176 $

5,400 $
44,585 $

- $
- $

5,983 $

- $ 90,176

- $

4,266
89,584
$ 93,850

5,400 $

- $ 44,585

- $ 10,030
14,103
$ 24,133

During 2012, 2011 and 2010, the Company recorded an impairment charge of $4.3 million, $10.0 million and $16.4 million,

respectively, as a component of depreciation and amortization for certain property, plant and equipment. The 2012 impairment charge
was primarily related to certain leasehold improvements and office furniture and equipment in the Artist Nation segment, an
amphitheater in the Concerts segment and a theatrical theater in other operations. The 2011 impairment charge related to two
amphitheaters, a music theater and a club in the Concerts segment. The 2010 impairment charge was primarily related to a club in the
Concerts segment and a theatrical theater in other operations. It was determined that these assets were impaired since the estimated
undiscounted future cash flows associated with the respective asset were less than its carrying value. These cash flows were calculated
using the estimated sale values for the assets being sold and/or operating cash flows, all of which were discounted to approximate fair
value. The estimated sale values and operating cash flows used for these non-recurring fair value measurements are considered Level
2 and Level 3 inputs, respectively.

During 2012, 2011 and 2010, the Company recorded impairments related to definite-lived intangible assets of $89.6 million,
$14.1 million and $17.2 million, respectively, as a component of depreciation and amortization. The 2012 impairment charge was
primarily related to intangible assets for client/vendor relationships in the Artist Nation segment and revenue-generating contracts and
client/vendor relationships in the Concerts segment. The 2011 impairment charge related to intangible assets for client/vendor
relationships, revenue-generating contracts and venue management and leaseholds in the Concerts segment. The 2010 impairment
charge was primarily related to intangible assets for revenue-generating contracts and trademarks and naming rights in the Concerts
segment. In all cases it was determined that these assets were impaired since the most recent estimated undiscounted future cash flows
associated with the respective assets fell to levels below their carrying values. These impairments were then calculated using operating
cash flows which were discounted to approximate fair value. The key inputs in these calculations include future cash flow projections,
including revenue and profit margins, attrition rates as applicable, and, for the fair value computation, a discount rate. The key inputs
used for these non-recurring fair value measurements are considered Level 3 inputs.

During 2010, the Company recorded an impairment related to indefinite-lived intangible assets of $10.0 million, as a component

of depreciation and amortization in the Ticketing segment. It was determined that certain indefinite-lived intangible assets were
impaired since the estimated fair value associated with those assets was less than its carrying value. The fair value of these assets was
calculated using a relief-from royalty method. The relief-from royalty method applied a royalty rate to the projected earnings
attributable to the indefinite-lived intangible assets. The projected earnings used for these non-recurring fair value measurements are
considered Level 3 inputs. There was no impairment charge recorded for the years ended December 31, 2012 and 2011 related to
indefinite-lived intangible assets.

During 2010, the Company recorded impairments related to certain artist advances of $13.4 million as a component of direct
operating expenses in the Concerts segment. It was determined that the recoverability of certain artist advances was uncertain since the
estimated undiscounted future cash flows associated with those advances were less than their carrying value. These cash flows were
calculated using operating cash flows which were discounted to approximate fair value. The operating cash flows used for these non-
recurring fair value measurements are considered Level 3 inputs.

NOTE 7—COMMITMENTS AND CONTINGENT LIABILITIES

The Company leases office space, certain equipment and many of its concert venues. Some of the lease agreements contain

renewal options and annual rental escalation clauses (generally tied to the consumer price index), as well as provisions for the
payment of utilities and maintenance by the Company. The Company also has non-cancelable contracts related to minimum
performance payments with various artists and other event-related costs. In addition, the Company has commitments relating to
additions to property, plant, and equipment under certain construction commitments for facilities and venues.

As of December 31, 2012, the Company’s future minimum rental commitments under non-cancelable operating lease
agreements with terms in excess of one year, minimum payments under non-cancelable contracts in excess of one year and capital
expenditure commitments consist of the following:

Non-cancelable
Operating Leases

2013 ..................... $
2014 .....................
2015 .....................
2016 .....................
2017 .....................
Thereafter ............

Total..................... $

118,892
114,355
109,639
107,893
98,040
1,415,977
1,964,796

Non-cancelable
Contracts
(in thousands)

728,504
139,508
116,899
80,446
38,039
19,629
1,123,025

Capital
Expenditures

3,225
25
25
25
25
250
3,575

Commitment amounts for non-cancelable operating leases and non-cancelable contracts which stipulate an increase in the
commitment amount based on an inflationary index have been estimated using an inflation factor of 2.5% for North America, 3.1% for
the United Kingdom and 2.1% for the Netherlands.

Aggregate minimum rentals of $87.3 million to be received in years 2013 through 2023 under non-cancelable subleases are

excluded from the commitment amounts in the above table.

Total rent expense charged to operations for 2012, 2011 and 2010 was $145.2 million, $128.7 million and $128.0 million,

respectively. In addition to the minimum rental commitments included in the table above, the Company has leases that contain
contingent payment requirements for which payments vary depending on revenue, tickets sold or other variables. Contingent rent
expense charged to operations for 2012, 2011 and 2010 was $30.0 million, $17.0 million and $20.1 million, respectively. The above
table above does not include contingent rent or rent expense for events in third-party venues.

In connection with asset and business disposals, the Company generally provides indemnifications to the buyers including
claims resulting from employment matters, commercial claims and governmental actions that may be taken against the assets or
businesses sold. Settlement of these claims is subject to various statutory limitations that are dependent upon the nature of the claim.
As of December 31, 2012 and 2011, the balance for these indemnifications for asset and business disposals was $0.7 million and $7.6
million, respectively.

Certain agreements relating to acquisitions that occurred prior to the adoption in January 2009 of the new FASB guidance for

business combinations provide for purchase price adjustments and other future contingent payments based on the financial
performance of the acquired companies. The Company will accrue additional amounts related to such contingent payments, which
were part of business combinations, with a corresponding adjustment to goodwill, if and when it is determinable that the applicable
financial performance targets will be met. The aggregate of these contingent payments, if all performance targets are met, would not
significantly impact the financial position of the Company. The last contingency period for which the Company has an outstanding
contingent earn-out payment is for the period ending December 2017.

The Company also has certain contingent obligations related to acquisitions made after the adoption in January 2009 of the
FASB guidance for business combinations. In accordance with the current guidance, contingent consideration associated with business
combinations must be recorded at its fair value at the time of the acquisition and reflected at current fair value for each subsequent
reporting period thereafter until settled. The Company records these fair value changes in its statements of operations as acquisition
transaction expenses. The contingent consideration is generally subject to payout following the achievement of future performance
targets and some may be payable in 2013. As of December 31, 2012, the Company has accrued $2.5 million in other current liabilities
and $4.2 million in other long-term liabilities and, as of December 31, 2011, the Company had accrued $1.5 million in other current
liabilities and $6.9 million in other long-term liabilities representing the fair value of these estimated earn-out arrangements. The last
contingency period for which the Company has an outstanding contingent earn-out payment is for the period ending December 2017.
See Note 6—Fair Value Measurements for further discussion related to the valuation of the earn-out payments.

In addition, the Company has certain contingent obligations related to acquisitions where the Company does not consolidate the

entity, but rather accounts for the investee under the equity method of accounting. If, at acquisition, the fair value of the Company’s
share of net assets exceeds the Company’s initial cost, the maximum amount of contingent consideration that could be paid is recorded
up to that excess amount. When the contingency is resolved, any difference between the amount recorded and the settlement is
recorded as an adjustment to the investment account. The aggregate of contingent payments associated with equity method
investments, if all performance targets are met, would not significantly impact the financial position of the Company. As of
December 31, 2011, the Company had accrued $3.9 million in other long-term liabilities for these estimated earn-out arrangements.
There were no contingent obligations related to investees accounted for under the equity method of accounting accrued at
December 31, 2012.

Certain agreements relating to acquisitions provide for deferred purchase consideration payments at future dates. A liability is
established at the time of the acquisition for these fixed payments. For obligations payable at a date greater than twelve months from
the acquisition date, the Company applies a discount rate to present value the obligations. As of December 31, 2011, the Company had
accrued $7.1 million in other current liabilities and $2.6 million in other long-term liabilities related to these deferred purchase
consideration payments. These deferred purchase consideration liabilities were settled during 2012.

During 2006, in connection with the Company’s acquisition of Historic Theatre Group, the Company guaranteed obligations

related to a lease agreement. In the event of default, the Company could be liable for obligations through the end of 2035 which have
future lease payments (undiscounted) of approximately $23.1 million as of December 31, 2012. The scheduled future minimum rentals
for this lease for the years 2013 through 2017 are $1.6 million each year. The venues under the lease agreement were included in the
sale of the Company’s North American theatrical business. The buyer has assumed the Company’s obligations under the guaranty,
however the Company remains contingently liable to the lessor. The Company believes that the likelihood of a material liability being
triggered under this lease is remote, and no liability has been accrued for these contingent lease obligations as of December 31, 2012.

As of December 31, 2012 and 2011, the Company guaranteed the debt of third parties of approximately $12.7 million and $13.1

million, respectively, primarily related to maximum credit limits on employee and tour-related credit cards and obligations under a
venue management agreement.

Litigation
CTS Arbitration

Live Nation Worldwide, Inc., (“Live Nation Worldwide”) and CTS were parties to an agreement (the “CTS Agreement”),
pursuant to which CTS was to develop and Live Nation Worldwide licensed or agreed to use ticketing software or ticketing platforms.
Under the agreement, CTS was to develop software to be licensed to Live Nation Worldwide to provide ticketing services in the
United States and Canada. The CTS Agreement also generally required Live Nation Worldwide to use CTS’s ticketing platforms in
certain European countries so long as CTS’s existing platforms were appropriately modified to meet local market conditions. In June
2010, Live Nation Worldwide terminated the CTS Agreement because CTS materially breached the agreement by failing to deliver a
North American ticketing system that met the contractual requirements of being a “world class ticketing system . . . that fits the needs
of the North American market,” and by failing to deliver a ticketing system for the United Kingdom and other European countries that
fit the needs of those markets as required by the CTS Agreement.

For North America, had CTS performed on the CTS Agreement, it would have been generally entitled to receive, during the
then 10-year term of the CTS Agreement, a per ticket license fee upon the sale of certain tickets that Live Nation Worldwide or any of
certain of its subsidiaries (collectively, the “Live Nation Worldwide entities”) controlled and had the right to distribute by virtue of
certain promotion and venue management relations. This per ticket fee for events in North America was payable to CTS regardless of
whether the Live Nation Worldwide entities chose to use the CTS ticketing platform, Ticketmaster’s ticketing platform or another
ticketing platform for the sale of such controlled tickets. For events in certain European countries, not including the United Kingdom,
Live Nation Worldwide generally was required, during a 10-year term, to exclusively book on the CTS ticketing platform all tickets
that the Live Nation Worldwide entities had the right to distribute (or, to the extent other ticketing platforms were used, Live Nation
Worldwide was generally required to pay to CTS the same fee that would have been payable had the CTS platform been used). For
events in the United Kingdom, Live Nation Worldwide was required, for a 10-year term, to (i) book on the CTS ticketing platform all
tickets controlled by Live Nation Worldwide entities that were not allocated by Live Nation Worldwide for sale through other sales
channels and (ii) to offer for sale on the CTS UK website a portion of the tickets controlled by the Live Nation Worldwide entities.
Finally, the CTS Agreement obligated Live Nation Worldwide and CTS to negotiate a set of noncompete agreements that, subject to
legal restrictions, could have precluded Live Nation Worldwide from offering primary market ticketing services to third parties in
certain European countries during the term of the CTS Agreement.

96
In April 2010, CTS filed a request for arbitration with the International Court of Arbitration of the International Chamber of

Commerce (“ICC”), pursuant to the CTS Agreement. In its request for arbitration, CTS asserts, among other things, that (i) the terms
of the CTS Agreement, including the North America per ticket license fee, European exclusivity obligations and United Kingdom
distribution obligations described above, apply to tickets sold and distributed by Ticketmaster, (ii) Ticketmaster’s sales and
distribution of tickets following the completion of the Merger have resulted in various breaches of Live Nation Worldwide’s
obligations under the CTS Agreement, (iii) Live Nation has failed to allocate the proper number of tickets to CTS’s system in the
United Kingdom and (iv) the Merger and the Company’s subsequent actions have breached the implied covenant of good faith and fair
dealing. In its request for arbitration, CTS seeks relief in the form of a declaration that Live Nation and Live Nation Worldwide are in
breach of the CTS Agreement and the implied covenant of good faith and fair dealing, specific performance of Live Nation
Worldwide’s obligations under the CTS Agreement, and unspecified damages resulting from such breaches. In March 2011, CTS
provided further specifications on its claims and purported damages, including a claim for royalties that would have been paid over the
contemplated 10-year term of the CTS Agreement and on Ticketmaster-controlled tickets (as well as tickets controlled by Live Nation
Worldwide or any of certain of its subsidiaries).

In May 2010, the Company responded to CTS’s request for arbitration and filed counterclaims asserting that CTS breached the

CTS Agreement by failing to provide ticketing platforms that met the standard required by the CTS Agreement for the North
American and European markets. The Company is seeking relief primarily in the form of damages and a declaration that the Company
validly terminated the CTS Agreement based on CTS’s material breaches. The Company denies that CTS is entitled to collect
damages for royalties that would have been paid over the full 10-year term of the CTS Agreement or on Ticketmaster-controlled
tickets. The matter has been assigned to an arbitrator, and hearings were conducted in the summer and fall of 2011. A decision from
the arbitrator is currently expected by spring of 2013. While the Company does not believe that a loss is probable of occurring at this
time, if the arbitrator rules against the Company on any or all claims, the amounts at stake could be substantial. Considerable
uncertainty remains regarding the validity of the claims and damages asserted against the Company. As a result, the Company is
currently unable to estimate the possible loss or range of loss for this matter. The Company intends to continue to vigorously defend
the action.

Ticketing Fees Consumer Class Action Litigation

In October 2003, a putative representative action was filed in the Superior Court of California challenging Ticketmaster’s

charges to online customers for shipping fees and alleging that its failure to disclose on its website that the charges contain a profit
component is unlawful. The complaint asserted a claim for violation of California’s Unfair Competition Law (“UCL”) and sought
restitution or disgorgement of the difference between (i) the total shipping fees charged by Ticketmaster in connection with online
ticket sales during the applicable period, and (ii) the amount that Ticketmaster actually paid to the shipper for delivery of those tickets.
In August 2005, the plaintiffs filed a first amended complaint, then pleading the case as a putative class action and adding the claim
that Ticketmaster’s website disclosures in respect of its ticket order processing fees constitute false advertising in violation of
California’s False Advertising Law. On this new claim, the amended complaint seeks restitution or disgorgement of the entire amount
of order processing fees charged by Ticketmaster during the applicable period. In April 2009, the Court granted the plaintiffs’ motion
for leave to file a second amended complaint adding new claims that (a) Ticketmaster’s order processing fees are unconscionable
under the UCL, and (b) Ticketmaster’s alleged business practices further violate the California Consumer Legal Remedies Act.
Plaintiffs later filed a third amended complaint, to which Ticketmaster filed a demurrer in July 2009. The Court overruled
Ticketmaster’s demurrer in October 2009.

The plaintiffs filed a class certification motion in August 2009, which Ticketmaster opposed. In February 2010, the Court
granted certification of a class on the first and second causes of action, which allege that Ticketmaster misrepresents/omits the fact of
a profit component in Ticketmaster’s shipping and order processing fees. The class would consist of California consumers who
purchased tickets through Ticketmaster’s website from 1999 to present. The Court denied certification of a class on the third and
fourth causes of action, which allege that Ticketmaster’s shipping and order processing fees are unconscionably high. In March 2010,
Ticketmaster filed a Petition for Writ of Mandate with the California Court of Appeal, and plaintiffs also filed a motion for
reconsideration of the Superior Court’s class certification order. In April 2010, the Superior Court denied plaintiffs’ Motion for
Reconsideration of the Court’s class certification order, and the Court of Appeal denied Ticketmaster’s Petition for Writ of Mandate.
In June 2010, the Court of Appeal granted the plaintiffs’ Petition for Writ of Mandate and ordered the Superior Court to vacate its
February 2010 order denying plaintiffs’ motion to certify a national class and enter a new order granting plaintiffs’ motion to certify a
nationwide class on the first and second claims. In September 2010, Ticketmaster filed its Motion for Summary Judgment on all
causes of action in the Superior Court, and that same month plaintiffs filed their Motion for Summary Adjudication of various
affirmative defenses asserted by Ticketmaster. In November 2010, Ticketmaster filed its Motion to Decertify Class.

97
In December 2010, the parties entered into a binding agreement providing for the settlement of the litigation and the resolution
of all claims therein. In September 2011, the Court declined to approve the settlement in its then-current form. Litigation continued,
and in September 2011, the Court granted in part and denied in part Ticketmaster’s Motion for Summary Judgment. The parties
reached a new settlement in September 2011, which was approved preliminarily, but in September 2012 the Court declined to grant
final approval. In doing so, the court identified potential modifications to the settlement, and the parties continue to discuss such
potential modifications and the possibility of a revised settlement agreement. Ticketmaster and its parent, Live Nation, have not
acknowledged any violations of law or liability in connection with the matter.

As of December 31, 2012, the Company has accrued $35.4 million, its best estimate of the probable costs associated with the
settlement referred to above. This liability includes an estimated redemption rate. Any difference between the Company’s estimated
redemption rate and the actual redemption rate it experiences will impact the final settlement amount; however, the Company does not
expect this difference to be material.

Canadian Consumer Class Action Litigation Relating to TicketsNow

In February 2009, four putative consumer class action complaints were filed in various provinces of Canada against

In February 2012, the parties entered into a settlement agreement that will resolve all of the resale market claims. The court

approval process for the settlement has been completed, with final approvals given in all provinces.

As of December 31, 2012, the Company has accrued its best estimate of the probable costs associated with the resale market

claims of this matter, the full amount of which was funded by an escrow established in connection with Ticketmaster’s 2008
acquisition of TicketsNow.

While it is reasonably possible that a loss related to the primary market claims of this matter could be incurred by the Company

in a future period, the Company does not believe that a loss is probable of occurring at this time. Considerable uncertainty remains
regarding the validity of the claims and damages asserted against the Company. As a result, the Company is currently unable to
estimate the possible loss or range of loss for the primary market claims of this matter. The Company intends to continue to vigorously
defend all claims in all of the actions.

Other Litigation

From time to time, the Company is involved in other legal proceedings arising in the ordinary course of its business, including
proceedings and claims based upon violations of antitrust laws and intellectual property rights, and tortious interference, which could
cause the Company to incur significant expenses. The Company has also been the subject of personal injury and wrongful death
claims relating to accidents at its venues in connection with its operations. As required, the Company has accrued its estimate of the
probable settlement or other losses for the resolution of any outstanding claims. These estimates have been developed in consultation
with counsel and are based upon an analysis of potential results, including, in some cases, estimated redemption rates for the
settlement offered, assuming a combination of litigation and settlement strategies. It is possible, however, that future results of
operations for any particular period could be materially affected by changes in the Company’s assumptions or the effectiveness of its
strategies related to these proceedings. In addition, under the Company’s agreements with Clear Channel, it has assumed and will
indemnify Clear Channel for liabilities related to its business for which they are a party in the defense.

As of December 31, 2012, the Company has accrued $40.6 million for the specific cases discussed above as its best estimate of

the probable costs of legal settlement, including $35.4 million for the Ticketing Fees Consumer Class Action litigation settlement.

NOTE 8—RELATED-PARTY TRANSACTIONS
Agreements with Liberty Media

In connection with a stockholder agreement, Liberty Media exercised its right to nominate two members to the Company’s

board of directors. In February 2011, the Company entered into a subscription agreement with Liberty Media. Pursuant to the
subscription agreement, in February and June 2011, the Company sold to Liberty Media 1.8 million and 5.5 million shares,
respectively, of the Company’s common stock for aggregate cash consideration of $18.8 million and $57.7 million, respectively.

98
Transactions Involving Directors

The following table sets forth expenses incurred and revenue earned from the transactions noted below:

Director related-party revenue .......... $

18,329

2012

Year Ended December 31,
2011
(in thousands)
22,069
$

2010

Director related-party expenses ........ $

21,795

25,210

7,839

Relationship with Clear Channel

For purposes of governing certain of the ongoing relationships between Clear Channel and Live Nation at and after the

Separation, Clear Channel and Live Nation entered into a tax matters agreement, among other agreements.

The Company has a non-employee director as of December 31, 2012 who is also a director and executive officer of Clear

Channel. This director receives directors’ fees, stock options and restricted stock awards on the same basis as other non-employee
members of the Company’s board of directors. Additionally, during 2012, the Company had an employee director who is also a
director of Clear Channel. From time to time, the Company purchases advertising from Clear Channel and its subsidiaries in the
ordinary course of business on an arms-length basis. The Company also has various lease and licensing agreements with Clear
Channel for office space.

Transactions with IAC

For purposes of governing certain of the ongoing relationships between IAC and Ticketmaster at and after the spin-off of the

Spincos from IAC, and to provide for an orderly transition, IAC, Ticketmaster and the other Spincos entered into a separation
agreement and a tax sharing agreement, among other agreements.

The Company occupied office space in a building in Los Angeles that is owned by IAC through December 2011. Since the

Company had a non-employee director until January 2011 who was also a director and executive officer of IAC, this rental
arrangement was considered a related party transaction for 2010.

Transactions with MSG

The Company has a non-employee director as of December 31, 2012 who is also a director and executive officer of MSG and

Cablevision. This director receives directors’ fees, stock options and restricted stock awards on the same basis as other non-employee
members of the Company’s board of directors. From time to time, the Company promotes events at venues owned and/or operated by
MSG and pays rental fees and co-promote fees to MSG and its subsidiaries. In addition, the Company provides ticketing services for
venues and sports franchises owned and/or operated by MSG and pays royalty fees to MSG and its subsidiaries. The Company also
receives transaction fees from MSG and its subsidiaries for tickets MSG sells using the Company’s ticketing software. Finally, the
Company purchases advertising from Cablevision and its subsidiaries from time to time. All of these transactions are entered into in
the ordinary course of business on an arms-length basis.

Transactions Involving Executives

ATC Aviation, Inc. (“ATC”), which is owned by Irving Azoff, owns an aircraft. An aircraft management and charter company,
unrelated to either the Company or ATC, manages and operates the aircraft on ATC’s behalf and charged market rates for the use of
the aircraft when used by Mr. Azoff or other executives on Company business, a portion of which was paid to ATC. For the years
ended December 31, 2012, 2011 and from the Merger date through December 31, 2010, the Company made payments to ATC and the
outside aircraft management and charter company totaling $1.9 million, $1.7 million and $0.7 million, respectively, pursuant to the
foregoing arrangements.

Irving Azoff has a minority ownership interest in an entity that subleases office space from the Company. For the years ended
December 31, 2012, 2011 and from the Merger date through December 31, 2010, rent charged by the Company totaled $0.7 million,
$0.7 million and $0.6 million, respectively.

The Azoff Trust was a party to the Second Amended and Restated Stockholders’ Agreement of Front Line dated as of June 9,
2008, as amended (the “Front Line Stockholders’ Agreement”). The Front Line Stockholders’ Agreement governed certain matters
related to Front Line and the ownership of securities of Front Line, including board designation rights, transaction approval
requirements, share transfer provisions, and put and call rights. The Front Line Stockholders’ Agreement also provided for the annual
pro rata dividend to be paid to the stockholders as soon as reasonably practicable after the end of each fiscal year. The Front Line
Stockholders’ Agreement was terminated in connection with the first quarter 2011 acquisition of the remaining equity interests in
Front Line. See Note 3—Acquisitions for further discussion of this 2011 transaction.

In January 2011, the board of directors of Front Line declared a dividend payable in cash to the holders of record of Front Line
common stock. This dividend was paid in January 2011 and totaled $20.1 million of which the Company received $15.0 million. The
Azoff Trust received a pro rata portion of this dividend totaling $3.0 million. In connection with the January 2011 dividend, Mr. Azoff
received a gross-up payment of $0.6 million. Prior to the payment of the dividend, FLMG made a loan to Front Line principally to
fund the dividend, evidenced by a promissory note from Front Line to FLMG with a principal amount of $20.7 million and bearing
interest at a rate of 4.5%, payable no later than December 31, 2011. As of December 31, 2011, the outstanding principal balance on
this promissory note was $1.0 million. The remaining outstanding principal balance was paid in full in January 2012.

Transactions Involving Equity Method Investees

The Company conducts business with certain of its equity method investees in the ordinary course of business. Transactions
relate to venue rentals, management fees, sponsorship revenue, and reimbursement of certain costs. Revenue of $2.3 million, $1.3
million and $1.2 million were earned in 2012, 2011 and 2010, respectively, and expenses of $5.4 million, $4.8 million and $5.0
million were incurred in 2012, 2011 and 2010, respectively, from these equity investees for services rendered or provided in relation
to these business ventures.

Other Related Parties

During the years ended December 31, 2011 and 2010, the Company paid $6.8 million and $6.9 million, respectively, for

deferred consideration due in connection with acquisitions of companies owned by various members of management of one of the
Company’s subsidiaries. One of these companies holds venue leases and the agreements were paid in full in 2011.

In January 2011, the Company sold a 49.9% noncontrolling interest in its clubs and theaters venue promotion business in Boston
to a company partially owned by two employees of one of the Company’s subsidiaries in exchange for assets and cash valued at $12.6
million. During the year ended December 31, 2010, the Company received $16.6 million in connection with the sale of a theater
business in Sweden to an entity owned by employees of one of the Company’s subsidiaries, one of which is an executive officer of the
Company.

The Company conducts certain transactions in the ordinary course of business with companies that are owned, in part or in total,

by various members of management of the Company’s subsidiaries or companies over which it has significant influence. These
transactions primarily relate to venue rentals, concession services, equipment rentals, ticketing, marketing and other services. As of
December 31, 2012 and 2011, the Company has a receivable balance of $12.2 million and $13.3 million, respectively, from certain of
these companies. The following table sets forth expenses incurred and revenue earned from these companies for services rendered or
provided in relation to these business ventures. None of these transactions were with directors or executive officers of the Company.

Other related-parties revenue............ $

Year Ended December 31,
2011
(in thousands)
5,226
$

2012

4,958

2010

6,846

Other related-parties expenses.......... $

14,275

9,007

12,419

100

NOTE 9—INCOME TAXES

Significant components of the provision for income tax expense (benefit) are as follows:

Current—federal............................................................................................. $
Current—foreign ............................................................................................
Current—state ................................................................................................
Total current..........................................................................................
Deferred—federal...........................................................................................
Deferred—foreign ..........................................................................................
Deferred—state ..............................................................................................
Total deferred........................................................................................
Income tax expense (benefit) ......................................................................... $

2012

2,235
34,541
3,917
40,693
(386)
(14,591)
4,020
(10,957)
29,736

2011
(in thousands)
$

(23,340) $
38,328
4,391
19,379
(29,153)
(13,463)
(2,987)
(45,603)
(26,224) $

2010

5,907
29,150
5,118
40,175
(21,348)
(2,737)
(936)
(25,021)
15,154

Current income tax expense increased $21.3 million for the year ended December 31, 2012 as compared to the prior year due
principally to the carryback of domestic net operating losses in 2011 which generated $24.2 million of federal tax refunds. Current
income tax expense decreased $20.8 million for the year ended December 31, 2011 as compared to the prior year due principally to
the carryback of domestic net operating losses which generated $24.2 million of federal tax refunds received in the first quarter of
2012.

Deferred income tax benefit decreased $34.6 million for the year ended December 31, 2012 as compared to the prior year due

principally to the reversal of valuation allowances recorded against United States federal and state deferred tax assets driven primarily
by deferred tax attributes relating to the acquisition of the remaining interests in Front Line in the first quarter of 2011 and an increase
in the blended state tax rate in 2012. Deferred income tax benefit increased $20.6 million for the year ended December 31, 2011 as
compared to the prior year due principally to the reversal of valuation allowances recorded against United States federal and state
deferred tax assets driven primarily by deferred tax attributes relating to the acquisition of the remaining interests in Front Line in the
first quarter of 2011.

The domestic loss from continuing operations before income taxes was $232.3 million, $200.4 million and $294.7 million for
2012, 2011 and 2010, respectively. Non-United States income from continuing operations before income taxes was $100.1 million,
$103.8 million and $106.0 million for 2012, 2011 and 2010, respectively.

Significant components of the Company’s deferred tax liabilities and assets as of December 31, 2012 and 2011 are as follows:

Deferred tax liabilities:

Intangible assets ............................... $
Prepaid expenses ..............................
Long-term debt.................................
Total deferred tax liabilities.......................

Deferred tax assets:

Intangible and fixed assets ...............
Accrued expenses.............................
Net operating loss carryforwards .....
Foreign tax credit carryforwards ......
Equity compensation........................
Investments in nonconsolidated

affiliates.......................................
Other ................................................
Total gross deferred tax assets...................

2012

2011

(in thousands)

281,071
4,575
41,949
327,595

27,723
53,125
379,111
38,710
47,542

5,267
14,114
565,592

317,862
2,067
32,773
352,702

75,353
59,346
288,830
32,541
39,249

5,125
13,670
514,114

Valuation allowance.........................
Total deferred tax assets...................
Net deferred tax liabilities................ $

425,404
140,188
(187,407)

336,799
177,315
(175,387)

101

The valuation allowance was recorded due to the uncertainty of the ability to generate sufficient taxable income necessary to

realize certain deferred tax assets in future years. If, at a later date, it is determined that due to a change in circumstances, the
Company will utilize all or a portion of those deferred tax assets, the Company will reverse the corresponding valuation allowance
with the offset to income tax benefit. In the first quarter of 2011, the Company recognized an income tax benefit of $39.5 million due
to the partial release of its valuation allowance. This release was related to the Company’s ability to consider Front Line’s net deferred
tax liabilities as a source of future taxable income within the consolidated federal tax provision as a result of the acquisition of the
remaining Front Line equity interests in 2011. For further discussion of events involving Front Line, see Note 3—Acquisitions.

During 2012 and 2011, the Company recorded net deferred tax liabilities of $21.3 million and $6.3 million, respectively, due

principally to differences in financial reporting and tax bases in assets acquired in business combinations.

Deferred tax assets related to intangibles and fixed assets principally relate to differences in book and tax basis of tax-deductible

goodwill created from the Company’s various stock acquisitions. As of December 31, 2012, the Company has United States federal
and state deferred tax assets related to net operating loss carryforwards of $267.1 million and $69.8 million, respectively. Based on
current statutory carryforward periods, these losses will expire on various dates between the years 2016 and 2032. The amount of
United States net operating loss carryforwards that will expire if not utilized in 2016 is $18.3 million. The Company’s federal net
operating loss is subject to statutory limitations on the amount that can be used in any given year. Pursuant to an amended U.S. federal
tax return for the year ended December 31, 2009, changes to deferred tax assets are reflected in the comparative schedule of 2012 and
2011 deferred tax liabilities and assets above. Specifically, as of December 31, 2011, the deferred tax asset for net operating loss
carryforwards increased $63.4 million, the deferred tax asset for foreign tax credit carryforwards decreased $50.9 million and the
valuation allowance on deferred tax assets increased $12.5 million.

The reconciliation of income tax from continuing operations computed at the United States federal statutory tax rates to income

tax expense (benefit) is:

Income tax benefit at statutory rates............................................................... $
State income taxes, net of federal tax benefits ...............................................
Differences of foreign taxes from U.S. statutory rates ...................................
Non-U.S. income inclusions and exclusions ..................................................
Loss on preferred stock redemption ...............................................................
Nondeductible acquisition costs .....................................................................
Nondeductible items.......................................................................................
Tax contingencies...........................................................................................
Change in valuation allowance.......................................................................
Other, net........................................................................................................

2012

(46,256)
3,917
(25,637)
9,901
-
-
9,005
4,316
79,214
(4,724)
29,736

2011
(in thousands)
$

(33,820) $
4,391
(25,158)
11,288
-
-
9,252
2,632
7,412
(2,221)
(26,224) $

2010

(66,029)
5,118
(24,150)
19,358
3,099
15,100
3,669
545
55,269
3,175
15,154

During 2012, the Company recorded income tax expense of approximately $29.7 million on losses from continuing operations

before tax of $132.2 million. Income tax expense is principally attributable to the Company’s earnings in foreign tax jurisdictions.

During 2011, the Company recorded an income tax benefit of approximately $26.2 million on losses from continuing operations

before tax of $96.6 million. Income tax benefit is principally attributable to the reversal of valuation allowances recorded against
United States federal and state deferred tax assets driven primarily by deferred tax attributes of $39.5 million relating to the
acquisition of the remaining interests in Front Line in the first quarter of 2011 and the carryback of the Front Line tax loss for the short
period January 1, 2011 to February 4, 2011 caused by the acquisition. At December 31, 2011, the Company had a $24.2 million
income tax receivable included in accounts receivable on the balance sheet.

Differences of foreign taxes from United States statutory rates of $25.6 million, $25.2 million and $24.2 million for the years
ended December 31, 2012, 2011 and 2010, respectively, are primarily attributable to the Company’s Luxembourg holding company
structure and tax rulings received from the Luxembourg tax authorities.

The Company regularly assesses the likelihood of additional assessments in each taxing jurisdiction resulting from current and

subsequent years’ examinations. Liabilities for income taxes have been established for future income tax assessments when it is
probable there will be future assessments and the amount thereof can be reasonably estimated. Once established, liabilities for
uncertain tax positions are adjusted only when there is more information available or when an event occurs necessitating a change to
the liabilities. The Company believes that the resolution of income tax matters for open years will not have a material effect on its
consolidated financial statements although the resolution of income tax matters could impact the Company’s effective tax rate for a
particular future period.

102

At December 31, 2012 and 2011, the Company had $16.0 million and $13.4 million, respectively, of unrecognized tax benefits.

All of these unrecognized tax benefits would favorably impact the effective tax rate if recognized at some point in the future.

The Company recognizes interest and penalties related to uncertain tax positions in income tax expense. For the years ended

December 31, 2012, 2011 and 2010, the Company has recognized $0.7 million, $0.7 million and ($0.1) million, respectively, of
interest and penalties related to uncertain tax positions. As of December 31, 2012 and 2011, the Company has accrued interest related
to uncertain tax positions of $1.6 million and $1.3 million, respectively.

The tax years 2001 through 2012 remain open to examination by the major tax jurisdictions to which the Company is subject.

The following table summarizes the activity related to the Company’s unrecognized tax benefits for the years ended

December 31, 2012, 2011 and 2010:

Balance at January 1............................................ $
Balance from current year acquisition.................
Additions:

Tax for current year positions....................
Tax for prior year positions .......................
Interest and penalties for prior years..........

Reductions:

Expiration of applicable statue of

limitations .............................................
Settlements for prior year positions ...........
Foreign currency .................................................
Reclassification to other liabilities ......................
Balance at December 31...................................... $

2012

13,357
-

2,978
652
686

-
(1,716)
247
(230)
15,974

2011
(in thousands)
10,917
$
-

1,991
(86)
727

-
-
(192)
-
13,357

2010

4,144
5,925

2,769
100
150

(744)
(1,730)
239
64
10,917

NOTE 10—STOCKHOLDERS’ EQUITY

Dividends

The Company presently intends to retain future earnings, if any, to finance the expansion of its business. Therefore, it does not
expect to pay any cash dividends in the foreseeable future. Moreover, the terms of the Company’s senior secured credit facility limit
the amount of funds that the Company will have available to declare and distribute as dividends on its common stock. Payment of
future cash dividends, if any, will be at the discretion of the Company’s board of directors in accordance with applicable laws after
taking into account various factors, including the financial condition, operating results, current and anticipated cash needs, plans for
expansion and contractual restrictions with respect to the payment of dividends.

Common Stock

In February 2011, the Company issued 5.7 million shares of common stock in connection with the acquisition of the remaining

interests in Front Line. See Note 3—Acquisitions for further discussion regarding this 2011 transaction.

In February and June 2011, the Company issued 1.8 million and 5.5 million shares, respectively, of common stock pursuant to a

subscription agreement with Liberty Media. See Note 8—Related-Party Transactions for further discussion of the subscription
agreement.

In May 2011, the Company issued 0.7 million shares of common stock in connection with the acquisition of the remaining

interests in Vector.

Common Stock Reserved for Future Issuance

Common stock of approximately 35.9 million shares as of December 31, 2012 is reserved for future issuances under the stock

incentive plan (including 24.7 million options and 3.2 million restricted stock awards currently granted).

103

Redeemable Noncontrolling Interests

For certain of its consolidated subsidiaries, the Company is subject to put arrangements arising from business combinations
where the holders of the noncontrolling interests can require the Company to repurchase their shares at specified dates in the future or
within specified periods in the future. Certain of these puts can be exercised earlier upon the occurrence of triggering events as
specified in the agreements. The exercise dates for these puts range from April 2013 to December 2018. The redemption amounts for
these puts are either at a fixed amount, at fair value at the time of exercise or variable based on a formula linked to earnings. In
accordance with the FASB guidance for business combinations, the redeemable noncontrolling interests are recorded at their fair value
at the acquisition date. As these put arrangements are not currently redeemable, for increases in the estimated redemption value, or
reductions in the estimated redemption value to the extent increases had been recognized previously, the Company accretes changes in
the redemption value over the period from the date of issuance to the earliest redemption date of the individual puts, with the offset
recorded to additional paid-in capital. Accounting guidance prohibits the recognition of reductions in value below issuance date value.
Changes in estimated redemption values that are based on a formula linked to future earnings are computed using projected cash flows
each reporting period which take into account the current expectations regarding profitability and the timing of revenue-generating
events. For redemption amounts that are fixed dollar amounts, if the initial fair value is the redemption amount, there are no changes
recorded until the puts are exercised or expire. The redemption amounts for these put arrangements are reflected in the Company’s
balance sheets as redeemable noncontrolling interests outside of permanent equity and, at December 31, 2012 and December 31, 2011,
were $42.1 million and $8.3 million, respectively. The increase during the current year is principally related to puts associated with the
2012 acquisitions.

Noncontrolling Interests

As of December 31, 2012, for the non-wholly-owned subsidiaries of the Company, where the common securities held by the

noncontrolling interests do not include put arrangements exercisable outside of the control of the Company, such noncontrolling
interests are recorded in stockholders’ equity, separate from the Company’s own equity.

The purchase or sale of ownership in an already controlled subsidiary, where the Company retains control after the transaction,
is recorded as an equity transaction with no gain or loss recognized in consolidated net income or comprehensive income. In 2011, the
Company acquired the remaining equity interests in Front Line, Vector and other smaller companies. See Note 3—Acquisitions for
further discussion regarding the Front Line acquisition. The following schedule reflects the change in ownership interests for these
transactions.

2012

Year Ended December 31,
2011
(in thousands)

2010

Net loss attributable to common stockholders of Live Entertainment,

Inc..................................................................................................... $

(163,227) $

(83,016) $

(228,390)

Transfers from noncontrolling interest:

Changes in Live Nation Entertainment, Inc.’s additional paid-
in capital for purchase of noncontrolling interests, net of
transaction costs ......................................................................
Net transfers from noncontrolling interest .........................
Change from net income (loss) attributable to common stockholders

of Live Nation Entertainment, Inc. and transfers from
noncontrolling interests .................................................................... $

43
43

85,590
85,590

3,573
3,573

(163,184) $

2,574 $

(224,817)

Earnings per Share

Basic net income per common share is computed by dividing the net income applicable to common shares by the weighted
average number of common shares outstanding during the period. Diluted net income per common share adjusts basic net income per
common share for the effects of stock options, restricted stock and other potentially dilutive financial instruments only in the periods
in which such effect is dilutive. The Company’s 2.875% convertible notes are considered in the calculation of diluted net income per
common share, if dilutive.

104

The following table sets forth the computation of basic and diluted net loss from continuing operations per common share:

2012
2010
2011
(in thousands, except for per share data)

(163,227)
-

(83,016) $
-

(228,390)
(4,228)

Net income (loss) attributable to common stockholders of Live Nation

Entertainment, Inc. ................................................................................ $

Less loss from discontinued operations, net of tax.....................................
Net loss from continuing operations attributable to common stockholders

of Live Nation Entertainment, Inc.—basic and diluted ......................... $

(163,227)

Weighted average common shares—basic .................................................
Effect of dilutive securities:

Stock options, restricted stock and warrants .....................................
2.875% convertible senior notes .......................................................
Weighted average common shares—diluted ..............................................

186,956

-
-
186,956

(83,016) $

(224,162)

182,388

-
-
182,388

164,410

-
-
164,410

Basic and diluted loss from continuing operations per common share ...... $

(0.87)

(0.46) $

(1.36)

The calculation of diluted net income per common share includes the effects of the assumed exercise of any outstanding stock
options and warrants, the assumed vesting of shares of restricted stock awards and units and the assumed conversion of the 2.875%
convertible senior notes where dilutive. The following table shows securities excluded from the calculation of diluted net income per
common share because such securities are anti-dilutive:

Options to purchase shares of common stock ..........................................................
Restricted stock awards and units - unvested ...........................................................
Warrants ...................................................................................................................
Conversion shares related to 2.875% convertible senior notes ................................
Number of anti-dilutive potentially issuable shares excluded from diluted

common shares outstanding.................................................................................

2012

2011
(in thousands)

24,722
3,207
500
8,105

21,429
4,028
500
8,105

2010

20,464
4,031
500
8,105

36,534

34,062

33,100

NOTE 11—STOCK-BASED COMPENSATION

In December 2005, the Company adopted its 2005 Stock Incentive Plan, which has been amended and/or restated on several

occasions. The plan authorizes the Company to grant stock option awards, director shares, stock appreciation rights, restricted stock
and deferred stock awards, other equity-based awards and performance awards. The Company has granted restricted stock awards and
options to purchase its common stock to employees, directors and consultants of the Company and its affiliates under the stock
incentive plan at no less than the fair market value of the underlying stock on the date of grant. The options are granted for a term not
exceeding ten years and the nonvested options are generally forfeited in the event the employee or director terminates his or her
employment or relationship with the Company or one of its affiliates. Any options that have vested at the time of termination are
forfeited to the extent they are not exercised within the applicable post-employment exercise period provided in their option
agreements. These options vest over one to five years. The stock incentive plan contains anti-dilutive provisions that require the
adjustment of the number of shares of the Company’s common stock represented by, and the exercise price of, each option for any
stock splits or stock dividends.

The following is a summary of stock-based compensation expense recorded by the Company during the respective periods:

Selling, general and administrative expenses ..................................................... $
Corporate expenses ............................................................................................

14,297
22,766

40,496 $
20,149

34,509
27,098

Total stock-based compensation expense........................................................... $

37,063

60,645 $

61,607

2012

2011
(in thousands)

2010

105

In December 2012, in connection with Mr. Azoff’s resignation, the Company accelerated the vesting of 0.7 million unvested

options, 0.3 million shares of unvested restricted stock awards and units and 1.5 million shares of restricted Live Nation common
stock held by the Azoff Trust. In addition, Mr. Azoff forfeited 0.4 million unvested options, 0.2 million unvested restricted stock
awards and 0.4 million restricted stock units (“RSUs”). As a result of these accelerations and forfeitures, the Company recognized an
additional $0.6 million of stock-based compensation expense for the year ended December 31, 2012 as a component of corporate
expense.

In the first quarter of 2011, the Company acquired the remaining equity interests of Front Line. As a result of this acquisition,

the Company recorded $24.4 million of stock-based compensation in selling, general and administrative expenses. See Note 3—
Acquisitions for further discussion regarding the 2011 acquisition of the remaining equity interests in Front Line.

In June 2011, the Company registered an additional 10.0 million shares to service the Live Nation stock incentive plan. In

January 2010, the Company registered an additional 4.9 million shares to service the Live Nation stock incentive plan, 1.5 million
shares to service the Live Nation stock bonus plan and 16.7 million shares to service the Ticketmaster stock and annual incentive plan.

As part of the Merger Agreement, all Ticketmaster stock options, restricted stock awards and RSUs that were outstanding
immediately before the Merger were exchanged for Live Nation awards using the final exchange ratio of 1.4743728. As a result, Live
Nation issued 13.0 million stock options, 1.5 million shares of restricted stock and 0.9 million RSUs to employees and directors of
Ticketmaster, as well as 2.5 million stock options and 0.2 million RSUs to employees of IAC and the Spincos. The Live Nation
awards have the same vesting periods, terms and conditions as the previous Ticketmaster awards, with the exception of 1.5 million
shares of restricted Live Nation common stock held by the Azoff Trust. Certain of the unvested shares held by the Azoff Trust at
December 31, 2012 were accelerated in connection with Mr. Azoff’s resignation from the Company as noted above. Stock-based
compensation expense of $6.3 million, $3.4 million and $3.2 million related to this restricted Live Nation common stock was recorded
for the years ended December 31, 2012, 2011 and from the Merger date until December 31, 2010, respectively, as a component of
corporate expenses. The value of all exchanged awards which related to services already rendered as of the date of the Merger was
included as part of the consideration transferred.

There were 23,825 stock-based awards issued by Front Line that were not exchanged or modified as a result of the Merger. The

Company recorded $6.9 million of expense relating to these awards from the date of the Merger through December 31, 2010 as a
component of selling, general and administrative expenses. In 2011, the Company acquired the remaining equity interests in Front
Line, Vector and other smaller companies including these stock-based awards. See Note 3—Acquisitions for further discussion
regarding the Front Line acquisition.

In 2010, the Company accelerated and modified the vesting of 1.4 million shares of unvested outstanding stock-based equity

awards granted to certain employees of Ticketmaster effective upon termination, all of which had been converted to Live Nation
equity awards in the Merger. The Company also accelerated 1.1 million shares of unvested outstanding stock-based equity awards as a
result of the Merger based on employment contract “change of control” provisions for certain employees. In addition to these merger-
related accelerations, the Company accelerated and modified the vesting of 3.4 million shares of unvested outstanding stock-based
equity awards granted to certain employees of Live Nation effective upon termination. As a result of these accelerations, the Company
recognized $18.1 million of stock-based compensation expense for the year ended December 31, 2010. Of this amount, $8.0 million
was recorded in corporate expenses and $10.1 million was recorded in selling, general and administrative expenses.

As of December 31, 2012, there was $53.8 million of total unrecognized compensation cost related to stock-based compensation

arrangements for stock options and restricted stock awards. This cost is expected to be recognized over a weighted-average period of
3.2 years.

Azoff Trust Note

As part of the Merger, a note was issued to the Azoff Trust in exchange for shares of Ticketmaster’s series A convertible
redeemable preferred stock held by the Azoff Trust. The note accrued interest equal to 3.0% of the outstanding principal balance and
was payable in monthly installments of $0.8 million through October 1, 2013. The note was paid in full in December 2012 in
connection with Mr. Azoff’s resignation.

The Company accounted for the note in accordance with the guidance for stock-based compensation because the note was
considered a modification of an existing stock-based award. The Company included $14.4 million in consideration transferred relating
to the exchanged award, calculated as the full fair value of the note, as determined by the Company, multiplied by the ratio of the pre-
combination service period to the total service period. The Company recognized a total of $24.0 million of stock-based compensation
expense, which is the difference between the total cash payments due under the note of $38.4 million and the initial carrying value of
$14.4 million at the date of the Merger. This expense was recognized on a straight-line basis over the remaining service period
through December 2012 and, in connection with Mr. Azoff’s resignation in December 2012, the remaining unamortized compensation
expense was recognized in 2012. For the years ended December 31, 2012, 2011 and from the date of the Merger through
December 31, 2010, the Company recorded $11.7 million, $6.4 million and $5.9 million, respectively, related to this note as a
component of corporate expenses.

106
Stock Options

The following assumptions were used to calculate the fair value of the Company’s options on the date of grant:

Risk-free interest rate..............................................................
Dividend yield.........................................................................
Volatility factors .....................................................................
Weighted average expected life (in years) ..............................

2012
0.83% - 1.14%
0.0%
54.6% - 61.3%
6.46

2011

0.99% - 2.16%
0.0%
39.6% - 62.5%
6.25

2010
1.93%
0.0%
39.6%
6.25

The following table presents a summary of the Company’s stock options outstanding at, and stock option activity during, the

years ended December 31, 2012, 2011 and 2010 (“Price” reflects the weighted average exercise price per share):

Outstanding January 1..................
Granted...............................
Merger conversion..............
Exercised ............................
Forfeited or expired ............

2012

2011

2010

Options

Price

Options

Price

Options

Price

21,429 $
5,495
-

(259)
(1,943)

(in thousands, except per share data)

12.33
8.80
-
4.39
11.70

20,464 $
2,512
-
(529)
(1,018)

12.41
11.22
-
5.13
15.20

7,099 $
2,471
15,476
(1,642)
(2,940)

12.13
11.01
12.72
4.76
16.35

Outstanding December 31............

24,722 $

11.68

21,429 $

12.33

20,464 $

12.41

Exercisable December 31 ............
Weighted average fair value per
option granted .........................

15,529 $

13.46

12,276 $

14.71

9,454 $

16.43

3.93

5.27

4.59

The total intrinsic value of stock options exercised during the years ended December 31, 2012, 2011 and 2010 was $1.3 million,
$3.0 million and $12.8 million, respectively. Cash received from stock option exercises for the years ended December 31, 2012, 2011
and 2010 was $1.1 million, $2.7 million and $8.6 million, respectively. Through December 31, 2012, no tax benefits from the exercise
of stock options have been recognized. Any future excess tax benefits derived from the exercise of stock options will be recorded
prospectively and reported as cash flows from financing activities in accordance with the FASB guidance for stock compensation.

There were 8.0 million shares available for future grants under the stock incentive plan at December 31, 2012. Upon share

option exercise or vesting of restricted stock and restricted stock units, the Company issues new shares or treasury shares to fulfill
these grants. Vesting dates on the stock options range from January 2013 to December 2017, and expiration dates range from January
2013 to July 2021 at exercise prices and average contractual lives as follows:

Outstanding
as of
12/31/12
(in thousands)

Weighted
Average
Remaining
Contractual
Life
(in years)

Weighted
Average
Exercise
Price

Exercisable
as of
12/31/12
(in thousands)

Weighted
Average
Remaining
Contractual
Life
(in years)

Weighted
Average
Exercise
Price

2,936
8,956
8,646
1,296
1,692
776
5
415

6.2 $
8.5 $
6.9 $
5.0 $
4.1 $
2.3 $
1.4 $
2.4 $

3.04
7.88
12.07
18.35
24.50
29.42
32.76
39.93

1,731
3,232
6,382
1,296
1,692
776
5
415

6.2 $
6.6 $
6.4 $
5.0 $
4.1 $
2.3 $
1.4 $
2.4 $

3.03
6.21
12.35
18.35
24.50
29.42
32.76
39.93

Range of
Exercise
Prices

$0.02 - $4.99
$5.00 - $9.99
$10.00 - $14.99
$15.00 - $19.99
$20.00 - $24.99
$25.00 - $29.99
$30.00 - $34.99
$35.00 - $39.99

The total intrinsic value of options outstanding and options exercisable as of December 31, 2012 was $31.3 million and $20.9

million, respectively.

107

Restricted Stock and Restricted Stock Units

The Company has granted restricted stock awards to its employees and directors under its stock incentive plans. These common

shares carry a legend which restricts their transferability for a term of one to five years and are forfeited in the event the recipient’s
employment or relationship with the Company is terminated prior to the lapse of the restriction. In addition, certain restricted stock
awards require the Company or the recipient to achieve minimum performance targets or market conditions in order for these awards
to vest.

RSUs are awards in the form of phantom shares or units, denominated in a hypothetical equivalent number of shares of the

Company’s common stock with the value of each RSU equal to the fair value of the Company’s common stock at the date of grant.
RSUs may be settled in cash, stock or both, as determined at the time of the grant. The majority of RSUs are settled in stock and are
classified as equity. Each RSU is subject to service-based vesting, where a specific period of continued employment must pass before
an award vests. The fair value of the RSU is amortized to expense on a straight-line basis over the RSUs vesting period. RSU grants to
international employees require cash settlement at the end of the vesting term and are therefore classified as liabilities.

In 2012, the Company granted 0.2 million shares of restricted stock and 1.0 million shares of market-based or performance-

based awards under the Company’s stock incentive plans. These awards will all vest over one or four years with the exception of the
market-based awards which will vest over four years if a specified stock price is achieved over a specified number of consecutive days
during the four years and the performance-based awards which will vest within one to three years if the performance criteria are met.

In 2011, the Company granted 0.8 million shares of restricted stock and 0.4 million shares of market-based or performance-
based awards under the Company’s stock incentive plans. These awards will all vest over four years with the exception of the market-
based awards which will vest over four years if a specified stock price is achieved over a specified number of consecutive days during
the four years and the performance-based awards which will vest within two years if the performance criteria are met.

In 2010, the Company granted 2.7 million shares of restricted stock and 0.5 million shares of market-based or performance-
based awards. These awards will all vest over four years with the exception of the market-based awards which will vest if a specified
stock price is achieved over a specified number of consecutive days and performance-based awards which will vest within two years if
the performance criteria are met.

The following table presents a summary of the Company’s unvested restricted stock awards and equity-settled RSUs
outstanding at December 31, 2012, 2011 and 2010 (“Price” reflects the weighted average share price at the date of grant):

Restricted Stock
Price

Awards

RSUs

Awards

Price

(in thousands, except per share data)
692 $

- $

Unvested at December 31, 2009...........................................................
Granted .......................................................................................
Merger conversion ......................................................................
Forfeited......................................................................................
Vested .........................................................................................
Unvested at December 31, 2010...........................................................
Granted .......................................................................................
Forfeited......................................................................................
Vested .........................................................................................
Unvested at December 31, 2011...........................................................
Granted .......................................................................................
Forfeited......................................................................................
Vested .........................................................................................
Unvested at December 31, 2012...........................................................

3,191
-
(71)
(787)
3,025 $
1,220
(35)
(885)
3,325 $
1,243
(151)
(1,215)
3,202 $

12.08
11.74
-
10.76
11.93
11.76
9.97
11.19
11.68
10.98
8.96
7.90
10.95
10.32

586
1,026
(147)
(459)
1,006 $
-
(66)
(237)
703 $
-
(373)
(325)

5 $

-
9.94
10.51
10.51
10.51
10.16
-
10.51
10.51
10.03
-
9.61
10.51
10.51

The total fair market value of the shares issued upon the vesting of restricted stock awards and RSUs during the years ended
December 31, 2012, 2011 and 2010 was $14.7 million, $12.0 million and $14.0 million, respectively. As of December 31, 2012, there
were 1.3 million restricted stock awards outstanding which require the Company or the recipient to achieve minimum performance
targets or market conditions in order for the awards to vest. There were no RSUs outstanding at December 31, 2012 that require the
Company or the recipient to achieve minimum performance targets or market conditions in order for the award to vest.

108

Stock-Based Compensation of Acquired Companies

Front Line

As of the Merger date and December 31, 2010, Irving Azoff had 3,402 options outstanding and exercisable to acquire Front
Line common stock from a 2006 grant by the Front Line board of directors. As of the Merger date and December 31, 2010, Mr. Azoff
and the Azoff Trust held 15,376 restricted shares of Front Line’s common stock from a June 2007 grant which were to cliff vest at the
end of the required service period on October 29, 2013. As of the date of the Merger and December 31, 2010, there were 5,047
restricted shares of common stock of Front Line outstanding with various employees and consultants.

The Company recorded $9.8 million relating to all Front Line awards from the date of the Merger through December 31, 2010

as a component of selling, general and administrative expenses.

In the first quarter of 2011, the Company acquired all of the remaining equity interests of Front Line that it did not previously

own in a series of transactions. See Note 3—Acquisitions for further discussion regarding the Front Line acquisition.

NOTE 12—OTHER INFORMATION

The following details the components of “Other current assets”:

Inventory................................................................................................. $
Cash held in escrow ................................................................................
Other .......................................................................................................
Total other current assets.................................................................................. $

The following details the components of “Other long-term assets”:................

Long-term advances................................................................................ $
Debt issuance costs .................................................................................
Prepaid rent.............................................................................................
Other .......................................................................................................
Total other long-term assets ............................................................................. $

The following details the components of “Accrued expenses”:

Accrued compensation and benefits ....................................................... $
Accrued event expenses..........................................................................
Collections on behalf of others ...............................................................
Accrued legal ..........................................................................................
Accrued insurance...................................................................................
Accrued royalties ....................................................................................
Other .......................................................................................................
Total accrued expenses..................................................................................... $

The following details the components of “Other current liabilities”:

Contingent and deferred purchase consideration .................................... $
Other .......................................................................................................
Total other current liabilities ............................................................................ $

The following details the components of “Other long-term liabilities”:

Accrued rent............................................................................................ $
Contingent and deferred purchase consideration ....................................
Unrecognized tax benefits ......................................................................
Deferred revenue ....................................................................................
Other .......................................................................................................
Total other long-term liabilities........................................................................ $

December 31,

2012

2011

(in thousands)

12,034
11,498
12,499
36,031

167,220
16,332
21,153
45,590
250,295

132,353
110,267
52,856
47,936
47,293
16,420
219,598
626,723

3,355
13,371
16,726

51,982
4,180
15,974
3,601
18,672
94,409

12,947
10,405
3,348
26,700

150,123
16,105
23,124
26,754
216,106

113,810
73,886
59,452
51,107
44,813
14,586
221,912
579,566

9,364
15,872
25,236

51,908
13,534
13,357
5,119
36,775
120,693

109

NOTE 13—SEGMENT DATA

The Company’s reportable segments are Concerts, Ticketing, Artist Nation and Sponsorship & Advertising. Prior to 2012, the

Company reported an eCommerce segment, which is now included in the Ticketing and Sponsorship & Advertising segments.
Specifically, all online advertising and online sponsorships previously reported in the eCommerce segment are now reported in the
Sponsorship & Advertising segment while all other activity has been included in the Ticketing segment. This change was made to be
consistent with how the four key components of the business are now being managed.

The Concerts segment involves the promotion of live music events globally in the Company’s owned and/or operated venues

and in rented third-party venues, the production of music festivals and the operation and management of music venues and is the
aggregation of the Company’s North American Concerts and International Concerts operating segments. The Ticketing segment
involves the management of the Company’s global ticketing operations including providing ticketing software and services to clients
and online access for customers relating to ticket and event information and is responsible for the Company’s primary websites,
www.livenation.com and www.ticketmaster.com. The Ticketing segment is the aggregation of the Company’s North American
Ticketing and International Ticketing operating segments. The Artist Nation segment provides management services to artists and
other services including merchandise, artist fan sites and VIP tickets and is the aggregation of the Company’s Artist Management and
Artist Services operating segments. The Sponsorship & Advertising segment manages the development of strategic sponsorship
programs in addition to the sale of international, national and local sponsorships and placement of advertising including signage,
promotional programs and banner ads in the Company’s owned and/or operated venues and on its primary websites.

The Company has reclassified all periods to conform to the current period presentation. Revenue and expenses earned and

charged between segments are eliminated in consolidation. Corporate expenses and all line items below operating income are
managed on a total company basis.

The Company manages its working capital on a consolidated basis. Accordingly, segment assets are not reported to, or used by,

the Company’s management to allocate resources to or assess performance of the segments, and therefore, total segment assets have
not been presented.

There are no customers that individually account for more than ten percent of the Company’s consolidated revenue in any year.

110
d
e
t
a
d
i
l
o
s
n
o
C

7
4
0
,
9
1
8
,
5

7
7
2
,
1
5
1
,
4

2
3
6
,
3
4
1
,
1

7
5
5
,
9
2
4

)
4
1
5
(

0
7
3
,
3

4
6
3
,
3
1
1

)
9
3
6
,
1
2
(

7
1
2
,
3
2
1

8
9
9
,
3
8
3
,
5

8
8
4
,
9
8
7
,
3

9
6
9
,
1
1
1
,
1

8
1
0
,
3
4
3

8
7
9

1
5
0
,
8

7
5
1
,
2
1
1

7
3
3
,
8
1

4
4
0
,
2
1
1

8
4
7
,
3
6
0
,
5

0
1
3
,
8
5
6
,
3

1
9
4
,
4
1
0
,
1

6
6
6
,
1
2
3

4
7
3

5
5
3
,
2
2

2
5
2
,
0
1
1

)
0
0
7
,
3
6
(

8
3
8
,
3
7

s
n
o
i
t
a
n
i
m

i
l

)
s
d
n
a
s
u
o
h
t

n
i
(

e
t
a
r
o
p
r
o
C

r
e
h
t
O

h
s
r
o
s
n
o
p
S

g
n
i
s
i
t
r
e
v
d
A
&

t
s
i
t
r
A

n
o
i
t
a
N

g
n
i
t
e
k
c
i
T

s
t
r
e
c
n
o
C

:
0
1
0
2
d
n
a

1
1
0
2
,
2
1
0
2
,
1
3

r
e
b
m
e
c
e
D
g
n
i
d
n
e

s
r
a
e
y
e
h
t

r
o
f

s
t
n
e
m
g
e
s

e
l
b
a
t
r
o
p
e
r

s
’
y
n
a
p
m
o
C
e
h
t

r
o
f

s
n
o
i
t
a
r
e
p
o
f
o
s
t
l
u
s
e
r

e
h
t

s
t
n
e
s
e
r
p
e
l
b
a
t
g
n
i
w
o
l
l
o
f

e
h
T

7
9
9
,
2
$

0
4
9
,
9
9
3
$

9
4
0
,
4
7
3
,
1
$

1
7
3
,
0
7
8
,
3
$

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
e
u
n
e
v
e
R

2
1
0
2

1
5
9
,
4
7
2
,
3

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
s
e
s
n
e
p
x
e

g
n
i
t
a
r
e
p
o
t
c
e
r
i

)
1
3
2
,
6
7
(

)
9
7
1
,
4
7
(

)
2
5
0
,
2
(

)
1
3
2
,
6
7
(

)
9
0
9
(

)
0
4
9
,
8
6
(

)
1
3
0
,
8
6
(

)
0
4
9
,
8
6
(

)
8
3
2
,
0
3
(

)
5
6
3
,
8
2
(

)
3
7
8
,
1
(

)
8
3
2
,
0
3
(

9
2
8
,
2

7
0
2
,
1

4
6
3
,
3
1
1

)
0
0
4
,
7
1
1
(

4
4
2
,
1

6
6
4
,
2

1
8
7
,
6
1

7
5
1
,
2
1
1

)
5
0
4
,
1
3
1
(

6
7
4
,
3

)
3
3
3
(

2
0
5
,
1

6
6
2
,
2

2
2
7
,
7
1

2
5
2
,
0
1
1

)
9
7
0
,
2
3
1
(

9
8
1
,
7

6
1
8

8
6
7
,
1

8
9
3

6
0
2

)
1
9
1
(

)
9
3
8
,
1
(

9
1
1
,
2

7
8
4
,
3
$

4
5

9
8
6

8
3
7
,
4
3

8
9
1
,
8
3

7
8
1
,
1

1
2
9
,
7
4
2

7
4
1
,
5

8
9
7
,
3
7
1

3
8
4

2
8
6
,
3
3

7
8
7
,
2
3

1
9
7
,
0
3
2

4
9
0
,
4

4
6
4
,
2
$

9
3
8
,
3
6
1

1
0
7
,
2

2
6
3
,
1

4
2
3
,
4
$

5
5
2

6
0
3

5
5
2

2
1
5
,
8
2

7
0
7
,
0
3

6
4
1
,
0
0
2

7
6

6
6
6
,
0
4
1

)
2
4
(

3
6
1
,
1

6
9
8
,
3
6
2

6
8
7
,
9
9

6
9
6
,
5
1
1

)
5
2
2
(

3
5
1

5
5
0
,
1
5
6

0
1
3
,
4
3
4

7
4
9
,
5
6
1

)
3
5
4
(

7
4
8

0
7
5
,
9
6
5

2
5
5
,
5
4
1

)
9
5
5
,
0
8
(
$

9
0
8
,
2
2
1

1
0
6

1
0
9
,
7

1
7
7
,
2

2
7
0
,
2
9

)
6
9
0
,
0
2
1
(

9
5
5
,
5
6

9
4
1
,
4
2

.
.
.
.
s
e
s
n
e
p
x
e

e
v
i
t
a
r
t
s
i
n
i
m
d
a

d
n
a

l
a
r
e
n
e
g

g
n
i
l
l
e
S

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
n
o
i
t
a
z
i
t
r
o
m
a

d
n
a

n
o
i
t
a
i
c
e
r
p
e
D

.
.
.
.
.
.
.
.
.
.
.
.
.
.
s
t
e
s
s
a

g
n
i
t
a
r
e
p
o

f
o

e
l
a
s
n
o
)
n
i
a
g
(

s
s
o
L

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
s
e
s
n
e
p
x
e

e
t
a
r
o
p
r
o
C

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
s
e
s
n
e
p
x
e

n
o
i
t
c
a
s
n
a
r
t

n
o
i
t
i
s
i
u
q
c
A

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
)
s
s
o
l
(

e
m
o
c
n
i

g
n
i
t
a
r
e
p
O

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
e
u
n
e
v
e
r

t
n
e
m
g
e
s
r
e
t
n
I

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
s
e
r
u
t
i
d
n
e
p
x
e

l
a
t
i
p
a
C

1
1
0
2

9
2
1
,
3
9
3
$

3
4
3
,
9
1
3
,
1
$

8
8
1
,
6
0
5
,
3
$

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
e
u
n
e
v
e
R

4
8
8
,
0
6
2

9
9
1
,
3
1
1

4
6
2
,
1

2
1
4
,
0
5

)
8
5
7
,
7
(

)
6
9
(

4
1
3
,
1

2
8
3
,
8
1
6

4
6
3
,
8
2
4

1
7
0
,
8
5
1

)
2
7
8
,
4
2
(
$

8
0
3
,
3
1
1

2
2
6
,
8

6
1
9
,
4

2
5
4
,
1

2
2
1
,
8
7

0
1
4
,
6
4
9
,
2

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
s
e
s
n
e
p
x
e

g
n
i
t
a
r
e
p
o
t
c
e
r
i

)
0
8
8
(

)
6
8
2
,
2
(

0
0
5
,
5
3
5

1
4
4
,
2
3
1

)
7
9
9
,
4
0
1
(

6
6
8
,
8
5

6
3
4
,
1
2

.
.
.
.
s
e
s
n
e
p
x
e

e
v
i
t
a
r
t
s
i
n
i
m
d
a

d
n
a

l
a
r
e
n
e
g

g
n
i
l
l
e
S

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
n
o
i
t
a
z
i
t
r
o
m
a

d
n
a

n
o
i
t
a
i
c
e
r
p
e
D

.
.
.
.
.
.
.
.
.
.
.
.
.
.
s
t
e
s
s
a

g
n
i
t
a
r
e
p
o

f
o

e
l
a
s
n
o
)
n
i
a
g
(

s
s
o
L

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
s
e
s
n
e
p
x
e

e
t
a
r
o
p
r
o
C

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
s
e
s
n
e
p
x
e

n
o
i
t
c
a
s
n
a
r
t

n
o
i
t
i
s
i
u
q
c
A

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
)
s
s
o
l
(

e
m
o
c
n
i

g
n
i
t
a
r
e
p
O

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
e
u
n
e
v
e
r

t
n
e
m
g
e
s
r
e
t
n
I

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
s
e
r
u
t
i
d
n
e
p
x
e

l
a
t
i
p
a
C

5
9
9
,
3
9

0
2
5
,
1
4

6
1
0
,
3
3
2

9
5
1
,
2
6
3
$

0
2

7
7
2
,
6

0
4
3
,
9
8
0
,
1
$

0
5
3
,
8
3
4
,
3
$

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
e
u
n
e
v
e
R

0
8
7

1
1
3
,
3
1
5

6
1
4
,
2
6
3

7
0
0
,
9
3
1

6
8
1
,
5

4
3
3
,
0
1
9
,
2

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
s
e
s
n
e
p
x
e

g
n
i
t
a
r
e
p
o
t
c
e
r
i

)
8
4
8
,
4
(

2
7
6
,
4
2
5

9
2
1
,
9
3
1

.
.
.
.
s
e
s
n
e
p
x
e

e
v
i
t
a
r
t
s
i
n
i
m
d
a

d
n
a

l
a
r
e
n
e
g

g
n
i
l
l
e
S

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
n
o
i
t
a
z
i
t
r
o
m
a

d
n
a

n
o
i
t
a
i
c
e
r
p
e
D

.
.
.
.
.
.
.
.
.
.
.
.
.
.
s
t
e
s
s
a

g
n
i
t
a
r
e
p
o

f
o

e
l
a
s
n
o
)
n
i
a
g
(

s
s
o
L

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
s
e
s
n
e
p
x
e

e
t
a
r
o
p
r
o
C

)
4
2
4
,
2
(

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
s
e
s
n
e
p
x
e

n
o
i
t
c
a
s
n
a
r
t

n
o
i
t
i
s
i
u
q
c
A

)
9
6
6
,
2
1
(
$

0
4
6
,
8
6

6
9
9

2
6
3
,
3
1

4
4
5
,
5
4

)
3
1
5
,
8
2
1
(

6
7
8
,
6
1

6
3
7
,
9
1

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
)
s
s
o
l
(

e
m
o
c
n
i

g
n
i
t
a
r
e
p
O

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
e
u
n
e
v
e
r

t
n
e
m
g
e
s
r
e
t
n
I

.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
s
e
r
u
t
i
d
n
e
p
x
e

l
a
t
i
p
a
C

0
1
0
2

111

The following table provides revenue and long-lived assets for the Company’s foreign operations included in the consolidated

financial statements:

United
Kingdom
Operations

Other
Foreign
Operations

Total
Foreign
Operations

(in thousands)

Total
Domestic
Operations

Consolidated
Total

2012
Revenue ................. $ 711,989 $
87,790 $
Long-lived assets ... $

2011
Revenue ................. $ 686,982 $
85,614 $
Long-lived assets ... $

2010
Revenue ................. $ 575,985 $
73,634 $
Long-lived assets ... $

1,368,768 $
102,706 $

2,080,757 $
190,496 $

3,738,290 $
531,290 $

1,387,295 $
99,459 $

2,074,277 $
185,073 $

3,309,721 $
535,063 $

1,044,288 $
82,624 $

1,620,273 $
156,258 $

3,443,475 $
580,806 $

5,819,047
721,786

5,383,998
720,136

5,063,748
737,064

112

administrative expenses...

Depreciation and

amortization ...................

Loss (gain) on sale of

operating assets ..............
Corporate expenses .............
Acquisition transaction

expenses .........................
Operating income (loss)......

Interest expense...................
Gain on extinguishment of
debt.................................
Interest income....................
Equity in earnings of
nonconsolidated
affiliates..........................

Other expense (income),

Income tax expense

(benefit)..........................
Net income (loss) ................
Net income (loss)
attributable to
noncontrolling interests....

Net income (loss)

attributable to common
stockholders of Live
Nation Entertainment,

NOTE 14—QUARTERLY RESULTS OF OPERATIONS (Unaudited)

March 31,

June 30,

September 30,

December 31,

2012

2011

2012

2011

2012

2011

2012
(in thousands)

Revenue .............................. $867,997 $849,409 $1,550,677 $1,558,882 $1,963,146 $1,790,025 $1,437,227 $1,185,682
Operating expenses:
Direct operating expenses ...
Selling, general and

538,714 547,124 1,106,869

1,286,304 1,048,271

817,909

1,138,151

1,457,423

268,135 272,969 280,943

266,795

283,846

282,462 310,708

289,743

79,713 77,481

94,259

76,927

84,684

83,341 170,901

105,269

(288)

1,295
23,217 21,036

93
27,415

(660)
24,590

(60)
30,842

231
27,385

(259)
31,890

1,309

1,665

(42,803)

(72,161)

(1,870)
42,968

706
52,373

1,896
104,515

5,493
104,809

2,035
(126,319)

29,710 29,229

29,488

30,845

35,535

30,388

29,007

(900)

(527)

-
(931)

-
(1,298)

(460)
(994)

(1,023)

-
(1,345)

112
39,146

187
(66,684)

29,952

-
(1,367)

(3,881)

(994)

(1,801)

(1,778)

(3,117)

(2,777)

(1,122)

(2,193)

net...................................

(1,782)

(585)

5,424

1,331

(6,575)

Income (loss) before

income taxes...................

(65,950)

(99,284)

10,788

23,273

80,126

6,461

4,266

(700)

71,760

(157,125)

(92,376)

4,278 (44,942)
(54,342)

(70,228)

5,228
5,560

6,659
16,614

11,950
68,176

8,739
63,021

8,280
(165,405)

3,320
(95,696)

(1,078)

(5,882)

(2,132)

3,357

10,228

11,309

(5,688)

3,829

Inc.............................. $ (69,150) $ (48,460) $

7,692 $

13,257 $

57,948 $

Basic net income (loss) per

common share
attributable to common
stockholders of Live
Nation Entertainment,

Inc.............................. $

(0.37) $

(0.27) $

0.04 $

0.07 $

0.31 $

Diluted net income (loss)
per common share
attributable to common
stockholders of Live
Nation Entertainment,

Inc.............................. $

(0.37) $

(0.27) $

0.04 $

0.07 $

0.31 $

51,712 $ (159,717) $

(99,525)

0.28 $

(0.87) $

(0.53)

0.27 $

(0.87) $

(0.53)

113

ITEM 9.

CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
DISCLOSURE

None.

ITEM 9A. CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures

We have established disclosure controls and procedures to ensure that material information relating to our company, including

our consolidated subsidiaries, is made known to the officers who certify our financial reports and to other members of senior
management and our board of directors.

Based on their evaluation as of December 31, 2012, our Chief Executive Officer and Chief Financial Officer have concluded

that our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934,
as amended) are effective to ensure that the information required to be disclosed by us in the reports that we file or submit under the
Securities Exchange Act of 1934, as amended, is recorded, processed, summarized and reported within the time periods specified in
SEC rules and forms.

Our management, including our Chief Executive Officer and Chief Financial Officer, does not expect that our disclosure

controls and procedures or internal controls will prevent all possible error and fraud. Our disclosure controls and procedures are,
however, designed to provide reasonable assurance of achieving their objectives, and our Chief Executive Officer and Chief Financial
Officer have concluded that our financial controls and procedures are effective at that reasonable assurance level.

Management’s Report on Internal Control over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in
Rule 13a-15(f) under the Securities Exchange Act of 1934, as amended. Our management conducted an evaluation of the effectiveness
of our internal controls over financial reporting based on the framework in Internal Control—Integrated Framework issued by the
Committee of Sponsoring Organizations of the Treadway Commission (the COSO criteria). Based on its evaluation, our management
concluded that our internal control over financial reporting was effective as of December 31, 2012.

Ernst & Young LLP, an independent registered public accounting firm, has issued an attestation report on our internal control

over financial reporting. The attestation report is included herein.

Changes in Internal Control Over Financial Reporting

There has been no change in our internal control over financial reporting during the fourth quarter of 2012 that has materially

affected, or is reasonably likely to materially affect, our internal control over financial reporting.

114

Report of Independent Registered Public Accounting Firm

The Board of Directors and Stockholders of Live Nation Entertainment, Inc.

We have audited Live Nation Entertainment, Inc.’s internal control over financial reporting as of December 31, 2012, based on criteria
established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway
Commission (the COSO criteria). Live Nation Entertainment, Inc.’s management is responsible for maintaining effective internal
control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting included in the
accompanying Management’s Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the
company’s internal control over financial reporting based on our audit.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those
standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over
financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over
financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of
internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances.
We believe that our audit provides a reasonable basis for our opinion.

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of
financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting
principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the
maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the
company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in
accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in
accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding
prevention or timely detection of unauthorized acquisition, use or disposition of the company’s assets that could have a material effect
on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections
of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in
conditions, or that the degree of compliance with the policies or procedures may deteriorate.

In our opinion, Live Nation Entertainment, Inc. maintained, in all material respects, effective internal control over financial reporting
as of December 31, 2012, based on the COSO criteria.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the
consolidated balance sheets of Live Nation Entertainment, Inc. as of December 31, 2012 and 2011 and the related consolidated
statements of operations, comprehensive loss, changes in stockholders’ equity, and cash flows for each of the three years in the period
ended December 31, 2012 of Live Nation Entertainment, Inc. and our report dated February 26, 2013 expressed an unqualified
opinion thereon.

Los Angeles, California
February 26, 2013

115

ITEM 9B. OTHER INFORMATION

None.

PART III

ITEM 10.

DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

Other than the information set forth under Item 1. Business—Executive Officers, the information required by this Item is

incorporated by reference to our Definitive Proxy Statement, expected to be filed within 120 days of our fiscal year end.

ITEM 11.

EXECUTIVE COMPENSATION

The information required by this Item is incorporated by reference to our Definitive Proxy Statement, expected to be filed within

120 days of our fiscal year end.

ITEM 12.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED
STOCKHOLDER MATTERS

The information required by this Item is incorporated by reference to our Definitive Proxy Statement, expected to be filed within

120 days of our fiscal year end.

ITEM 13.

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

The information required by this Item is incorporated by reference to our Definitive Proxy Statement, expected to be filed within

120 days of our fiscal year end.

ITEM 14.

PRINCIPAL ACCOUNTING FEES AND SERVICES

The information required by this Item is incorporated by reference to our Definitive Proxy Statement, expected to be filed within

120 days of our fiscal year end.

116

PART IV

ITEM 15.
(a)1. Financial Statements.

EXHIBITS, FINANCIAL STATEMENT SCHEDULES

The following consolidated financial statements are included in Item 8:

Consolidated Balance Sheets as of December 31, 2012 and 2011....................................................................................................

Consolidated Statements of Operations for the Years Ended December 31, 2012, 2011 and 2010..................................................

Consolidated Statements of Comprehensive Loss for the Years Ended December 31, 2012, 2011 and 2010..................................

Consolidated Statements of Changes in Stockholders’ Equity for the Years Ended December 31, 2012, 2011 and 2010...............

Consolidated Statements of Cash Flows for the Years Ended December 31, 2012, 2011 and 2010 ................................................

Notes to Consolidated Financial Statements.....................................................................................................................................

(a)2. Financial Statement Schedule.

The following financial statement schedule for the years ended December 31, 2012, 2011 and 2010 is filed as part of this report

and should be read in conjunction with the consolidated financial statements.

Schedule II Valuation and Qualifying Accounts
All other schedules for which provision is made in the applicable accounting regulation of the SEC are not required under the

related instructions or are inapplicable, and therefore have been omitted.

117

LIVE NATION ENTERTAINMENT, INC.
SCHEDULE II
VALUATION AND QUALIFYING ACCOUNTS
Allowance for Doubtful Accounts

Balance at
Beginning of
Period

Charges of
Costs,
Expenses and
Other

Write-off of
Accounts
Receivable
(in thousands)

Description

Other

Balance at
End of Period

Year ended December 31, 2010.................... $

8,230 $

4,666 $

(2,342) $

344 (1) $

10,898

Year ended December 31, 2011.................... $

10,898 $

6,440 $

(243) $

(109)(1) $

16,986

Year ended December 31, 2012.................... $

16,986 $

6,480 $

(4,155) $

483 (1) $

19,794

(1) Foreign currency adjustments.

118

LIVE NATION ENTERTAINMENT, INC.
SCHEDULE II
VALUATION AND QUALIFYING ACCOUNTS
Deferred Tax Asset Valuation Allowance

Description

Balance at
Beginning of
Period

Charges of
Costs,
Expenses and
Other (1)

Deletions
(in thousands)

Other (1)

Balance at
End of Period

Year ended December 31, 2010 (2) .......... $

204,294 $

55,269 $

- $

64,107 $

323,670

Year ended December 31, 2011................ $

323,670 $

7,412 $

Year ended December 31, 2012................ $

336,799 $

79,214 $

- $

5,717 $

336,799

9,391 $

425,404

(1) During 2012, 2011 and 2010, the valuation allowance was adjusted for acquisitions and divestitures.
(2) The balance at the beginning of period for the year ended December 31, 2010, has been increased by $12.5 million

pursuant to an amended U. S. federal tax return for the year ended December 31, 2009.

119

Exhibit
No .
2.1

3.1

3.2

4.1

4.2

4.3

4.4

4.5

10.1

10.2

10.3

10.4

10.5

Exhibit Description

Agreement and Plan of Merger,
dated February 10, 2009, between
Ticketmaster Entertainment, Inc.
and Live Nation, Inc.
Amended and Restated Certificate
of Incorporation of Live Nation
Entertainment, Inc., as amended.
Fourth Amended and Restated
Bylaws of Live Nation
Entertainment, Inc.
Rights Agreement, dated
December 21, 2005, between CCE
Spinco, Inc. and The Bank of New
York, as Rights Agent.
First Amendment to Rights
Agreement, dated February 25,
2009, between Live Nation, Inc.
and The Bank of New York Mellon,
as Rights Agent.
Second Amendment to Rights
Agreement, effective as of
September 23, 2011, entered into by
and between Live Nation
Entertainment, Inc. and The Bank
of New York Mellon, as rights
agent.
Form of Certificate of Designations
of Series A Junior Participating
Preferred Stock.
Form of Right Certificate.

Second Amended and Restated
Certificate of Incorporation of Live
Nation Holdco #2, Inc.
Indenture, dated July 16, 2007,
between Live Nation, Inc. and
Wells Fargo Bank, N.A., as
Trustee.
Indenture, dated July 28, 2008,
among Ticketmaster, the
Guarantors identified therein and
The Bank of New York Mellon, as
Trustee.
First Supplemental Indenture, dated
August 20, 2008, to the Indenture,
dated July 28, 2008, among
Ticketmaster, the Guarantors
identified therein and The Bank of
New York Mellon, as Trustee.
Second Supplemental Indenture,
dated April 30, 2009, to the
Indenture, dated July 28, 2008,
among Ticketmaster, the
Guarantors identified therein and
The Bank of New York Mellon, as

Incorporated by Reference

Form
8-K

File No.
001-32601

Exhibit No.
2.1

Filing Date
Filed By
2/13/2009 Live Nation

Filed
Here
with

Entertainment,
Inc.

10-K

001-32601

3.1

2/25/2010 Live Nation

8-K

001-32601

3.1

6/13/2012 Live Nation

8-K

001-32601

4.1

12/23/2005 Live Nation

Entertainment,
Inc.

8-K

001-32601

4.1

3/3/2009 Live Nation

Entertainment,
Inc.

8-K

001-32601

4.1

9/28/2011 Live Nation

Entertainment,
Inc.

8-K

001-32601

4.2

12/23/2005 Live Nation

8-K

001-32601

4.3

12/23/2005 Live Nation

8-K

001-32601

10.2

7/23/2008 Live Nation

Entertainment,
Inc.

8-K

001-32601

4.1

7/16/2007 Live Nation

Entertainment,
Inc.

S-1

333-152702

10.21

8-K

001-34064

4.1

10-Q

001-34064

10.2

Entertainment,
Inc.

8/1/2008 Ticketmaster
Entertainment
LLC

8/25/2008 Ticketmaster
Entertainment
LLC

8/13/2009 Ticketmaster
Entertainment
LLC

120

Exhibit
No .

10.6

10.7

10.8

10.9

10.10

10.11

Exhibit Description

Trustee.
Third Supplemental Indenture,
dated July 23, 2009, to the
Indenture, dated July 28, 2008,
among Ticketmaster, the
Guarantors identified therein and
The Bank of New York Mellon, as
Trustee.
Fourth Supplemental Indenture,
dated January 25, 2010, to the
Indenture, dated July 28, 2008,
among Ticketmaster, the
Guarantors named therein and The
Bank of New York Mellon, as
Trustee.
Fifth Supplemental Indenture, dated
as of April 30, 2010, to the
Indenture dated July 28, 2008,
among Ticketmaster, the
Guarantors named therein and The
Bank of New York Mellon, as
Trustee.
Sixth Supplemental Indenture,
entered into as of May 6, 2010, to
the Indenture, dated July 28, 2008,
among Ticketmaster, the
Guarantors named therein and The
Bank of New York Mellon, as
Trustee.
Seventh Supplemental Indenture,
entered into as of February 14,
2011, among Live Nation
Entertainment, Inc., the guarantors
listed in Appendix I attached
thereto, Career Artist Management
LLC, and The Bank of New York
Mellon Trust Company, N.A., as
Trustee.
Eighth Supplemental Indenture,
entered into as of August 4, 2011,
among Live Nation Entertainment,
Inc., the guarantors listed in
Appendix I attached thereto, Vector
Management LLC, Vector West,
LLC and The Bank of New York
Mellon Trust Company, N.A., as
trustee.

10.12 Ninth Supplemental Indenture,

entered into as of January 4, 2012,
among Live Nation Entertainment,
Inc., the guarantors listed in
Appendix I attached thereto, Live
Nation LGTours (USA), LLC and
The Bank of New York Mellon
Trust Company, N.A. as trustee.
Tenth Supplemental Indenture,
entered into as of February 28,

10.13

Incorporated by Reference

Form

File No.

Exhibit No.

Filing Date

Filed By

10-Q

001-34064

10.3

8/13/2009 Ticketmaster
Entertainment
LLC

Filed
Here
with

8-K

001-32601

4.1

1/29/2010 Live Nation

Entertainment,
Inc.

10-Q

001-32601

10.1

8/5/2010 Live Nation

Entertainment,
Inc.

10-Q

001-32601

10.2

8/5/2010 Live Nation

Entertainment,
Inc.

10-Q

001-32601

10.4

5/5/2011 Live Nation

Entertainment,
Inc.

10-Q

001-32601

10.2

11/3/2011 Live Nation

Entertainment,
Inc.

10-K

001-32601

10.12

2/24/2012 Live Nation

Entertainment,
Inc.

10-Q

001-32601

10.1

5/10/2012 Live Nation

Entertainment,

121

Exhibit
No .

10.14

10.15

Exhibit Description
2012, among Live Nation
Entertainment, Inc., the guarantors
listed in Appendix I attached
thereto, HOB Punch Line S.F.
Corp., and The Bank of New York
Mellon Trust Company, N.A., as
trustee.
Eleventh Supplemental Indenture,
entered into as of August 16, 2012,
among Live Nation Entertainment,
Inc., the guarantors listed in
Appendix I attached thereto, HARD
Events LLC, and The Bank of New
York Mellon Trust Company, N.A.,
as trustee.
Lockup and Registration Rights
Agreement, dated May 26, 2006,
among Live Nation, Inc., SAMCO
Investments Ltd., Concert
Productions International Inc., CPI
Entertainment Rights, Inc. and the
other parties set forth therein.

10.16 Voting Agreement, dated

10.17

February 10, 2009, between Liberty
USA Holdings, LLC and Live
Nation, Inc.
Stockholder Agreement, dated
February 10, 2009, among Live
Nation, Inc., Liberty Media
Corporation, Liberty USA
Holdings, LLC and Ticketmaster
Entertainment, Inc.
10.18 Note, dated January 24, 2010,

10.20

among Ticketmaster Entertainment,
Inc., Azoff Family Trust of 1997
and Irving Azoff.
10.19 Registration Rights Agreement,
dated January 25, 2010, among
Live Nation, Inc., Liberty Media
Corporation and Liberty Media
Holdings USA, LLC.
Tax Matters Agreement, dated
December 21, 2005, among CCE
Spinco, Inc., CCE Holdco #2, Inc.
and Clear Channel
Communications, Inc.
Tax Sharing Agreement, dated
August 20, 2008, among
IAC/InterActiveCorp, HSN, Inc.,
Interval Leisure Group, Inc.,
Ticketmaster and Tree.com, Inc.
Form of Indemnification
Agreement.

10.21

10.22

10.23 §

Live Nation Entertainment, Inc.
2005 Stock Incentive Plan, as
amended and restated as of

Incorporated by Reference

Form

File No.

Exhibit No.

Filing Date

Filed
Here
with

Filed By

Inc.

8-K

001-32601

4.1

6/2/2006 Live Nation

Entertainment,
Inc.

8-K

001-32601

10.1

2/13/2009 Live Nation

Entertainment,
Inc.

8-K

001-32601

10.2

2/13/2009 Live Nation

Entertainment,
Inc.

10-K

001-32601

10.17

2/25/2010 Live Nation

Entertainment,
Inc.

8-K

001-32601

10.1

1/29/2010 Live Nation

Entertainment,
Inc.

8-K

001-32601

10.2

12/23/2005 Live Nation

8-K

001-34064

10.2

Entertainment,
Inc.

8/25/2008 Ticketmaster
Entertainment
LLC

10-K

001-32601

10.23

2/25/2010 Live Nation

8-K

001-32601

10.3

6/20/2011 Live Nation

Entertainment,
Inc.

122

Exhibit
No .

Exhibit Description

April 15, 2011.

10.24 § Amended and Restated

Ticketmaster Entertainment, Inc.
2008 Stock and Annual Incentive
Plan.

10.25 § Amendment No. 1 to the Amended

10.26 §

and Restated Ticketmaster
Entertainment, Inc. 2008 Stock and
Annual Incentive Plan.
Live Nation Entertainment, Inc.
2006 Annual Incentive Plan, as
amended and restated as of
April 15, 2011.
10.27 § Amended and Restated Live

Nation, Inc. Stock Bonus Plan.

10.28 §

10.29 §

Employment Agreement, dated
October 21, 2009, among Live
Nation, Inc., Live Nation
Worldwide, Inc. and Michael
Rapino.
First Amendment to Employment
Agreement, dated December 27,
2012 by and between Live Nation
Entertainment, Inc. and Michael
Rapino.
10.30 § Amended and Restated

Employment Agreement, effective
September 1, 2009, between Live
Nation Worldwide, Inc. and
Michael G. Rowles .

10.31 § Amended and Restated

10.32 §

10.33 §

10.34 §

10.35 §

10.36 §

Employment Agreement, effective
September 1, 2009, between Live
Nation Worldwide, Inc. and Kathy
Willard.
Employment Agreement, effective
December 17, 2007, between Live
Nation Worldwide, Inc. and Brian
Capo.
First Amendment to Employment
Agreement, effective December 31,
2008, between Live Nation
Worldwide, Inc. and Brian Capo.
Second Amendment to
Employment Agreement, effective
October 22, 2009, between Live
Nation Worldwide, Inc. and Brian
Capo.
Employment Agreement, effective
February 1, 2007, between Live
Nation Worldwide, Inc. and Nathan
Hubbard.
First Amendment to Employment
Agreement, effective March 1,
2009, between Live Nation
Worldwide, Inc. and Nathan

Incorporated by Reference

Form

File No.

Exhibit No.

Filing Date

Filed By

S-8

333-164507

10.1

1/26/2010 Live Nation

Filed
Here
with

Entertainment,
Inc.

10-Q

001-32601

10.1

11/4/2010 Live Nation

Entertainment,
Inc.

8-K

001-32601

10.2

6/20/2011 Live Nation

Entertainment,
Inc.

8-K

001-32601

10.1

1/25/2010 Live Nation

8-K

001-32601

10.1

10/22/2009 Live Nation

Entertainment,
Inc.

8-K

001-32601

10.2

10/22/2009 Live Nation

Entertainment,
Inc.

8-K

001-32601

10.3

10/22/2009 Live Nation

Entertainment,
Inc.

10-Q

001-32601

10.4

8/7/2008 Live Nation

Entertainment,
Inc.

10-K

001-32601

10.30

3/5/2009 Live Nation

Entertainment,
Inc.

10-K

001-32601

10.55

2/25/2010 Live Nation

Entertainment,
Inc.

10-Q

001-32601

10.1

5/10/2010 Live Nation

Entertainment,
Inc.

10-Q

001-32601

10.2

5/10/2010 Live Nation

Entertainment,
Inc.

123

Exhibit
No .

10.37 §

10.38 §

10.39

10.40

10.41

10.42

10.43

10.44

Exhibit Description

Hubbard.
Second Amendment to
Employment Agreement, effective
January 1, 2011, by and between
Live Nation Worldwide, Inc. and
Nathan Hubbard.
Employment Agreement, effective
March 18, 2011, between Live
Nation Entertainment, Inc. and Joe
Berchtold.
Indenture dated as of May 6, 2010
by and among Live Nation
Entertainment, Inc., the Guarantors
party thereto and The Bank of New
York Mellon Trust Company, N.A.,
as trustee.
First Supplemental Indenture,
entered into as of February 14,
2011, among Live Nation
Entertainment, Inc., the guarantors
listed in Appendix I attached
thereto, Career Artist Management
LLC, and The Bank of New York
Mellon Trust Company, N.A., as
trustee.
Second Supplemental Indenture,
entered into as of August 4, 2011,
among Live Nation Entertainment,
Inc., the guarantors listed in
Appendix I attached thereto, Vector
Management LLC, Vector West,
LLC and The Bank of New York
Mellon Trust Company, N.A., as
trustee.
Third Supplemental Indenture,
entered into as of January 4, 2012,
among Live Nation Entertainment,
Inc., the guarantors listed in
Appendix I attached thereto, Live
Nation LGTours (USA), LLC, and
The Bank of New York Mellon
Trust Company, N.A., as trustee.
Fourth Supplemental Indenture,
entered into as of February 28,
2012, among Live Nation
Entertainment, Inc., the guarantors
listed in Appendix I attached
thereto, HOB Punch Line S.F.
Corp., and The Bank of New York
Mellon Trust Company, N.A., as
trustee.
Fifth Supplemental Indenture,
entered into as of August 16, 2012,
among Live Nation Entertainment,
Inc., the guarantors listed in
Appendix I attached thereto, HARD
Events LLC, and The Bank of New

Incorporated by Reference

Form

File No.

Exhibit No.

Filing Date

Filed By

8-K

001-32601

10.1

10/14/2011 Live Nation

Filed
Here
with

Entertainment,
Inc.

10-Q

001-32601

10.1

8/7/2012 Live Nation

Entertainment,
Inc.

10-Q

001-32601

10.3

8/5/2010 Live Nation

Entertainment,
Inc.

10-Q

001-32601

10.3

5/5/2011 Live Nation

Entertainment,
Inc.

8-K

001-32601

10.1

11/3/2009 Live Nation

Entertainment,
Inc.

10-K

001-32601

10.43

2/24/2012 Live Nation

Entertainment,
Inc.

10-Q

001-32601

10.2

5/10/2012 Live Nation

Entertainment,
Inc.

124

Exhibit
No .

10.45

10.46

10.47

10.48

10.49

10.50

10.51

Exhibit Description
York Mellon Trust Company, N.A.,
as trustee.
Sixth Supplemental Indenture,
entered into as of October 4, 2012,
among Live Nation Entertainment,
Inc., the Guarantors listed in
Appendix I attached hereto, Live
Nation Ushtours (USA), LLC, and
The Bank of New York Mellon
Trust Company, N.A., as trustee.
Credit Agreement entered into as of
May 6, 2010, among Live Nation
Entertainment, Inc., the Foreign
Borrowers party thereto, the
Guarantors identified therein, the
Lenders party thereto, JPMorgan
Chase Bank, N.A., as
Administrative Agent and
Collateral Agent, JPMorgan Chase
Bank, N.A., Toronto Branch, as
Canadian Agent and J.P. Morgan
Europe Limited, as London Agent.
Amendment No. 1, dated as of
June 29, 2012, entered into by and
among Live Nation Entertainment,
Inc., the relevant Credit Parties
identified therein, the lenders party
thereto, and JPMorgan Chase Bank,
N.A., as administrative agent for
the Lenders .
Incremental Term Loan Joinder
Agreement No. 1, dated August 20,
2012, by and among Live Nation
Entertainment, Inc.,
JPMorganChase Bank, N.A., as
administrative agent, each
Incremental Term Loan Lender
defined therein and the relevant
Credit Parties identified therein.
Indenture, dated August 20, 2012,
by and among Live Nation
Entertainment, Inc., the Guarantors
defined therein, and the Bank of
New York Mellon Trust Company,
N.A., as trustee.
First Supplemental Indenture,
entered into as of October 4, 2012,
among Live Nation Entertainment,
Inc., the Guarantors listed in
Appendix I attached hereto, Live
Nation Ushtours (USA), LLC, and
The Bank of New York Mellon
Trust Company, N.A., as trustee.
Stock Purchase Agreement, dated
as of February 4, 2011, by and
among Live Nation Entertainment,
Inc., FLMG Holdings Corp., Irving

Incorporated by Reference

Form

File No.

Exhibit No.

Filing Date

Filed By

Filed
Here
with

10-Q

001-32601

10.4

11/5/2012 Live Nation

Entertainment,
Inc.

10-Q

001-32601

10.4

8/5/2010 Live Nation

Entertainment,
Inc.

10-Q

001-32601

10.2

8/7/2012 Live Nation

Entertainment,
Inc.

10-Q

001-32601

10.2

11/5/2012 Live Nation

Entertainment,
Inc.

10-Q

001-32601

10.1

11/5/2012 Live Nation

Entertainment,
Inc.

10-Q

001-32601

10.3

11/5/2012 Live Nation

Entertainment,
Inc.

8-K

001-32601

10.1

2/7/2011 Live Nation

Entertainment,
Inc.

125

Exhibit Description

Form

File No.

Exhibit No.

Filing Date

Filed By

Incorporated by Reference

8-K

001-32601

10.2

2/7/2011 Live Nation

Entertainment,
Inc.

Exhibit
No .

10.52

12.1

14.1

21.1
23.1
24.1

31.1

31.2

32.1

32.2

Azoff, the Azoff Family Trust of
1997, dated May 27, 1997, as
amended, Madison Square Garden,
L.P., LNE Holdings, LLC, and
Front Line Management Group,
Inc.
Subscription Agreement, dated as
of February 4, 2011, by and
between Liberty Media Corporation
and Live Nation Entertainment, Inc.
Computation of Ratio of Earnings
to Fixed Charges.
Code of Business Conduct and
Ethics.
Subsidiaries of the Company.
Consent of Ernst & Young LLP.
Power of Attorney (see signature
page).
Certification of Chief Executive
Officer.
Certification of Chief Financial
Officer.
Section 1350 Certification of Chief
Executive Officer.
Section 1350 Certification of Chief
Financial Officer.

101.INS * XBRL Instance Document
101.SCH * XBRL Taxonomy Schema

Document

101.CAL * XBRL Taxonomy Calculation

Linkbase Document

101.DEF * XBRL Taxonomy Definition

Linkbase Document
101.LAB * XBRL Taxonomy Label Linkbase

Document

101.PRE * XBRL Taxonomy Presentation
Linkbase Document

Filed
Here
with

X
X
X

X
X

§ Management contract or compensatory plan or arrangement.
*

In accordance with Rule 406T of Regulation S-T, the XBRL related information in Exhibit 101 to this Annual Report on Form
10-K shall not be deemed to be “filed” for purposes of Section 18 of the Exchange Act, or otherwise subject to the liability of
that section, and shall not be part of any registration statement or other document filed under the Securities Act or the Exchange
Act, except as shall be expressly set forth by specific reference in such filing.

The Company has not filed long-term debt instruments of its subsidiaries where the total amount under such instruments is less
than ten percent of the total assets of the Company and its subsidiaries on a consolidated basis. However, the Company will furnish a
copy of such instruments to the Commission upon request.

126

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this

report to be signed on its behalf by the undersigned, thereunto duly authorized, on February 26, 2013.

SIGNATURES

LIVE NATION ENTERTAINMENT, INC.

By:

/s/ Michael Rapino
Michael Rapino
President and Chief Executive Officer

POWER OF ATTORNEY

KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints,

jointly and severally, Michael Rapino and Kathy Willard, and each of them, as his or her true and lawful attorneys-in-fact and agents,
with full power of substitution and resubstitution, for him or her and in his or her name, place and stead, in any and all capacities, to
sign any and all amendments to this Annual Report on Form 10-K, and to file the same, with all 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 and necessary to be done in connection
therewith, as fully to all intents and purposes as he or she might or could do in person, hereby ratifying and confirming all that said
attorneys-in-fact and agents, or any of them, or their or his or her substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons

on behalf of the registrant and in the capacities and on the dates indicated.

Name

/s/ Michael Rapino
Michael Rapino
/s/ Kathy Willard
Kathy Willard
/s/ Brian Capo
Brian Capo
/s/ Mark Carleton
Mark Carleton
/s/ Jonathan Dolgen
Jonathan Dolgen
/s/ Ariel Emanuel
Ariel Emanuel
/s/ Robert Ted Enloe, III
Robert Ted Enloe, III
/s/ Jeffrey T. Hinson
Jeffrey T. Hinson
/s/ James S. Kahan
James S. Kahan
/s/ Gregory B. Maffei
Gregory B. Maffei
/s/ Randall T. Mays
Randall T. Mays
/s/ Mark S. Shapiro
Mark S. Shapiro

Title

President and Chief Executive Officer
and Director

Chief Financial Officer

Chief Accounting Officer

Director

Date

February 26, 2013

127

PERFORMANCE GRAPH

The graph below shows the relative investment performance of our common stock, the NYSE Market Index

and the Hemscott Group Index for the period from December 31, 2007 through December 31, 2012 assuming
reinvestment of dividends at the date of payment into the common stock of the indexes. The Hemscott Group Index
consists of the following fourteen companies: Bona Film Group Limited; Dial Global, Inc.; Digital Domain Media
Group, Inc.; Imax Corporation; Kit Digital, Inc.; Ku6 Media Co., Ltd.; Live Nation Entertainment, Inc.; News
Corporation; The Madison Square Garden Company; The Walt Disney Company; Time Warner Inc.; Valcom, Inc.;
Viacom Inc. and World Wrestling Entertainment, Inc. The information reflected below is not necessarily indicative
of our future performance.

COMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN*
Among Live Nation Entertainment, Inc., the NYSE Composite Index, and the Hemscott Group Index

$160

$140

$120

$100

$80

$60

$40

$20

12/07

12/08

12/09

12/10

12/11

12/12

Live Nation Entertainment, Inc.

NYSE Composite

Peer Group

*$100 invested on 12/31/07 in stock or index, including reinvestment of dividends.
Fiscal year ending December 31.

Live Nation Entertainment, Inc. ........
NYSE Composite ..............................
Hemscott Group Index.......................

12/31/07 12/31/08 12/31/09 12/31/10 12/31/11 12/31/12
64.12
98.55
147.63

100.00
100.00
100.00

57.23
84.96
110.30

78.65
88.36
100.86

39.53
60.74
58.38

58.61
77.92
85.82

128

This page intentionally left blank.

Board of Directors

Corporate Information

Mark Carleton
Senior Vice President, Liberty Media Corporation

Jonathan Dolgen
Principal, Wood River Ventures, LLC

Ariel Emanuel
Chief Executive Officer, WME Entertainment

Robert Ted Enloe, III
Managing General Partner, Balquita Partners, Ltd.

Jeffrey T. Hinson
President, YouPlus Media, LLC

James S. Kahan
AT&T Senior Executive Vice President – Corporate Development,
Retired

Gregory B. Maffei (Chairman of the Board)
President and Chief Executive Officer, Liberty Media Corporation

Randall T. Mays
Vice Chairman, Clear Channel Communications, Inc.

Michael Rapino
President and Chief Executive Officer, Live Nation Entertainment

Mark S. Shapiro
Executive Producer, Dick Clark Productions

Executive and Other Key Officers

Michael Rapino
President and Chief Executive Officer

Ron Bension
President – HOB Entertainment

Joe Berchtold
Chief Operating Officer

Mark Campana
President – North America Concerts, Regions North

Brian Capo
Chief Accounting Officer

Arthur Fogel
Chairman – Global Music and President – Global Touring

John Hopmans
Executive Vice President – Mergers and Acquisitions and Strategic
Finance

Nathan Hubbard
President – Ticketmaster

Simon Lewis
President – Live Nation Europe, Sponsorship and Concerts

John Reid
President – Live Nation Europe, Concerts

Alan Ridgeway
President – International and Emerging Markets

Bob Roux
President – North America Concerts, Regions South

Michael Rowles
General Counsel and Secretary

Russell Wallach
President – North America Sponsorships

Kathy Willard
Chief Financial Officer

Mark Yovich
President – Ticketmaster International

Independent Registered Public Accounting Firm

Ernst & Young LLP
Los Angeles, California

Investor Relations and Press Contacts

Maili Bergman (Investors)
Senior Vice President, Investor Relations

Jacqueline Peterson (Press)
Senior Vice President, Corporate Communications

Live Nation Entertainment
9348 Civic Center Drive
Beverly Hills, California 90210
(310) 867-7000

Transfer Agent and Registrar

Computershare Shareowner Services

Stockholder correspondence should be mailed to:
Computershare
P.O. Box 43006
Providence, Rhode Island 02940-3006

Overnight correspondence should be mailed to:
Computershare
250 Royall Street
Canton, Massachusetts 02021

(877) 296-7874
(201) 680-6578 (for callers outside the United States)

Stockholder website: www.computershare.com/investor
Stockholder online inquiries:
https://www-us.computershare.com/investor/Contact

Stock Listing

Live Nation Entertainment’s common stock is listed on the New York
Stock Exchange under the symbol “LYV.”

Annual Report on Form 10-K

Live Nation Entertainment’s Annual Report on Form 10-K for the
year ended December 31, 2012 is included in this annual report. The
exhibits accompanying the report are filed with the U.S. Securities
and Exchange Commission and can be accessed in the EDGAR
database at the SEC’s website, www.sec.gov, or through the
“Investors” section of Live Nation Entertainment’s website, at
to
www.livenation.com/investors. We will provide
stockholders upon request. Requests for any such exhibits should be
made to:

these

items

Live Nation Entertainment
Attention: Corporate Secretary
9348 Civic Center Drive
Beverly Hills, California 90210

Forward-Looking Statements

forward-looking statements

In accordance with the Private Securities Litigation Reform Act of
1995, Live Nation Entertainment notes that this annual report
contains
risks and
uncertainties, including those relating to our company’s future
success and growth. Actual results may differ materially due to risks
and uncertainties as described in our filings with the U.S. Securities
and Exchange Commission. Live Nation Entertainment does not
intend to update these forward-looking statements.

involve

that