Table of Contents 

Principal amounts by expected maturity in U.S. dollars as of December 31, 2000 are as follows (in thousands, except percentages):  

2001 

2002 

2003 

Total 

Fair Value 

Corporate notes and bonds 

$  104,492   

$  19,276   

$ 2,500   

$  126,268   

$  126,438 

Weighted average interest rate 

6.24 % 

6.65 % 

6.99 % 

6.32 % 

U.S. Government securities 

29,000   

10,500   

39,500   

39,609 

Weighted average interest rate 

5.87 % 

6.09 % 

5.93 % 

Commercial Paper 

107,520   

107,520   

106,924 

Weighted average interest rate 

6.58 % 

6.58 % 

Taxable municipal bonds 

80,800   

80,800   

80,800 

Weighted average interest rate 

6.83 % 

6.83 % 

Certificate of Deposit 

1,750   

1,750   

1,750 

Weighted average interest rate 

6.81 % 

6.81 % 

Adjustable Rate Mortgage 

Weighted average interest rate 

Cash equivalents and marketable fixed income securities 

$  323,562   

$  29,776   

$ 2,500   

$  355,838   

$  355,521 

Equity Investment Risk 

.     We have invested in equity instruments of public and privately held technology companies for business and 

strategic purposes. These investments are recorded as long term assets. For the privately held investments, our policy is to regularly review the 

valuation of the company and assumptions underlying the operating performance and cash flow forecasts in assessing the carrying value. If the 

carrying value of the privately held investment has decreased, an other than temporary decline in market value is deemed to have occurred and 

an impairment on the investment is recorded in the statement of operations. For our publicly held investments, we are subject to significant 

fluctuations in fair market value due to the volatility of the stock market. Changes in fair market value for our publicly held investments are 

recorded as a component of other comprehensive income and do not effect net income until the securities are sold and a realized gain or loss is 

incurred or if an other than temporary decline in market value has occurred and an impairment on the investment is recorded. During 2000 and 

the first quarter of 2001, a portion of our public and private investments were held in the InfoSpace Venture Fund. Changes in fair market value 

for investments held by the Venture Fund, prior to dissolution as of March 31, 2001, were recorded through the statement of operations and had 

material effects on net income in 2000 and 2001. The closure of the Venture Fund in the first quarter of 2001 affected the accounting for these 

investments as they reverted back to InfoSpace and the accounting for gains and losses are as noted above. As of January 1, 2001, changes in 

the market value of warrants that qualify as derivatives are recorded through the Statement of Operations. The Company recorded a charge of 

$3.2 million as of January 1, 2001 to adopt SFAS No. 133, which requires that these warrants be presented at fair value, and recorded 

additional charges of $5.4 million during 2001 for further declines in the fair value of warrants held.  

As of December 31, 2001, the fair value of our publicly held and privately held investments was $8.7 million and $38.4 million, 

respectively. As of December 31, 2000, the fair value of our publicly held and privately held investments was $24.0 million and $97.6 million, 

respectively. Included in the December 31, 2001 investment balance is $7.8 million of warrant investments. Included in the December 31, 2000 

investment balance is $18.5 million of warrant investments. All of these investments are in companies involved in Internet related businesses 

and their fair values are subject to significant fluctuations due to changes in general economic conditions. The fair values of our publicly held 

investments are also subject to fluctuations in the stock market. Based on the fair value of the publicly traded securities that we held at 

December 31, 2001, an assumed 15%, 25% or 50% adverse change to market prices would result in corresponding declines in total fair value 

of approximately $1.3 million, $2.2 million or $4.4 million, respectively.  

Foreign Currency Risk 

:     We have offices in Canada, the United Kingdom, The Netherlands, Australia and Brazil. Historically, the 

foreign currency exchange rate exposure has had a minimal impact on our financial results. We do not expect this exposure to be material in the 

future.  

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