ServiceMagic 2009 Annual Report Download - page 117

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Table of Contents
IAC/INTERACTIVECORP AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
NOTE 18—SUPPLEMENTAL CASH FLOW INFORMATION (Continued)
Supplemental Disclosure of Cash Flow Information:
NOTE 19—RELATED PARTY TRANSACTIONS
Continuing operations
Relationships Involving the Company and Expedia
In connection with and following the Expedia spin-off, the Company and Expedia entered into various commercial agreements, which
generally include distribution agreements, services agreements and advertising agreements, as well as a cost sharing agreement. Certain of these
agreements were entered into with IAC entities that were subsequently spun-off or sold and, accordingly, the related activity is described in
discontinued operations. Total amounts received by the Company from Expedia related to these agreements in 2009, 2008 and 2007 were
$1.3 million, $2.7 million and $3.1 million, respectively. Amounts receivable by the Company from Expedia related to these agreements at
December 31, 2009 and 2008 were $0.5 million and $0.6 million, respectively, and are included in "Accounts receivable, net" in the
accompanying consolidated balance sheet. Total payments made by the Company to Expedia related to these agreements were $0.2 million in
2009, and $0.1 million in both 2008 and 2007. Amounts payable to Expedia by the Company related to these agreements were less than
$0.1 million at both December 31, 2009 and 2008, and are included in "Accounts payable, trade" in the accompanying consolidated balance
sheet. The Company and Expedia expect these commercial relationships to continue for the foreseeable future. The Company and Expedia are
related parties since they are under common control, given that Mr. Diller serves as Chairman and Chief Executive Officer of the Company and
Chairman and Senior Executive of Expedia.
In addition, each of the Company and Expedia has a 50% ownership interest in an aircraft that may be used by both companies. Members of
this aircraft's flight crew are employed by an entity in which each of the Company and Expedia has a 50% ownership interest. The Company and
Expedia have agreed to share costs relating to flight crew compensation and benefits pro-rata according to each company's respective usage of
the aircraft, for which they are separately billed by the entity described above. During 2009, 2008 and 2007, total payments of $0.5 million,
$0.6 million and $0.5 million, respectively, were made to this entity by the Company.
Relationships Involving Named Executive Officer and Directors
On August 9, 2007, the Company sold a portion of its investment in Front Line to the Warner Music Group for $109.9 million. The sale did
not result in a recognized gain or loss because the investment was sold at the same per share price that the Company paid to acquire the
investment. Warner Music Group is a related party because its Chairman is one of the Company's board members.
106
Years Ended December 31,
2009
2008
2007
(In thousands)
Cash paid during the
period for:
Interest
5,682
$
54,465
56,585
Income tax payments
8,397
16,191
174,539
Income tax refunds
(136,435
)
(15,397
)
(33,505
)