jvid视频

(1)听听听Basis of Presentation

The accompanying condensed consolidated financial statements include the accounts of jvid视频. and its controlled subsidiaries (collectively, "jvid视频," the "Company," 鈥淐onsolidated jvid视频,鈥� 鈥渦s,鈥� 鈥渨e,鈥� or 鈥渙ur鈥� unless the context otherwise requires). All significant intercompany accounts and transactions have been eliminated in consolidation. jvid视频 is made up of wholly-owned subsidiaries QVC, Inc. (鈥淨VC鈥�), which includes HSN, Inc. (鈥淗SN鈥�), Cornerstone Brands, Inc. (鈥淐ornerstone鈥�), Zulily, LLC (鈥淶ulily鈥�), and other cost and equity method investments.

jvid视频 is primarily engaged in the video and online commerce industries in North America, Europe and Asia. The businesses of the Company鈥檚 wholly-owned subsidiaries, QVC, Cornerstone and Zulily, are seasonal due to a higher volume of sales in the fourth calendar quarter related to year-end holiday shopping. 听

The accompanying (a) condensed consolidated balance sheet as of December听31, 2020, which has been derived from audited financial statements, and (b) the interim unaudited condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles ("GAAP") for interim financial information and the instructions to Form听10-Q and Article听10 of Regulation听S-X as promulgated by the Securities and Exchange Commission. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation of the results for such periods have been included. Additionally, certain prior period amounts have been reclassified for comparability with current period presentation. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto contained in jvid视频's Annual Report on Form听10-K for the year ended December听31, 2020 (the 鈥�2020 10-K鈥�).

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. jvid视频 considers (i)听fair value measurements, (ii)听accounting for income taxes, and (iii)听estimates of retail-related adjustments and allowances to be its most significant estimates. 听 听

In December 2019, a new coronavirus (鈥淐OVID-19鈥�) was reported to have surfaced in Wuhan, China and has subsequently spread across the globe causing a global pandemic, impacting all countries where jvid视频 operates. As a result of the spread of COVID-19, certain local governmental agencies have imposed travel restrictions, local quarantines or stay at home restrictions to contain the spread, which has caused a significant disruption to most sectors of the economy.

Management is not presently aware of any events or circumstances arising from COVID-19 that would require the Company to update the estimates, judgments or revise the carrying value of our assets or liabilities. Management's estimates may change, however, as new events occur and additional information is obtained, and any such changes will be recognized in the consolidated financial statements. Actual results could differ from estimates, and any such differences may be material to our financial statements.

As a result of repurchases of Series A jvid视频 common stock (鈥淨RTEA鈥�) and other equity transactions, the Company鈥檚 additional paid-in capital balance was in a deficit position as of September听30, 2021.听听In order to ensure that the additional paid-in capital account is not negative, we reclassified the amount of the deficit ($259 million) at September听30, 2021 to retained earnings.

jvid视频 has entered into certain agreements with Liberty Media Corporation ("LMC") (for accounting purposes, a related party of the Company), a separate publicly traded company. These agreements include a reorganization agreement, services agreement and facilities sharing agreement. 听As a result of certain corporate transactions, LMC and jvid视频 may have obligations to each other for certain tax related matters. Neither jvid视频 nor LMC has any stock ownership, beneficial or otherwise, in the other. In connection with a split-off transaction that occurred in the first quarter of 2018 (the 鈥淕CI Liberty Split-Off鈥�), jvid视频 and GCI Liberty, Inc. (鈥淕CI Liberty鈥�) entered into a tax sharing agreement. Pursuant to the tax sharing agreement, GCI Liberty agreed to indemnify jvid视频 for taxes and tax-related losses

resulting from the GCI Liberty Split-Off to the extent such taxes or tax-related losses (i) result primarily from, individually or in the aggregate, the breach of certain restrictive covenants made by GCI Liberty (applicable to actions or failures to act by GCI Liberty and its subsidiaries following the completion of the GCI Liberty Split-Off), or (ii) result from Section 355(e) of the Internal Revenue Code applying to the GCI Liberty Split-Off as a result of the GCI Liberty Split-Off being part of a plan (or series of related transactions) pursuant to which one or more persons acquire, directly or indirectly, a 50-percent or greater interest (measured by vote or value) in the stock of GCI Liberty (or any successor corporation). Following a merger between Liberty Broadband Corporation (鈥淟iberty Broadband鈥�) and GCI Liberty, Liberty Broadband (for accounting purposes, a related party of the Company) has assumed the tax sharing agreement.

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In December 2019, the Company entered into an amendment to the services agreement in connection with LMC鈥檚 entry into a new employment arrangement with Gregory B. Maffei, the Company鈥檚 Chairman of the Board (the 鈥淐hairman鈥�). Under the amended services agreement, components of his compensation will either be paid directly to him by each of the Company, Liberty TripAdvisor Holdings, Inc., and Liberty Broadband (collectively, the 鈥淪ervice Companies鈥�) or reimbursed to LMC, in each case, based on allocations among LMC and the Service Companies set forth in the amended services agreement, currently set at听17% for the Company.听

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The reorganization agreement with LMC provides for, among other things, provisions governing the relationship between jvid视频 and LMC, including certain cross-indemnities. Pursuant to the services agreement, LMC provides jvid视频 with certain general and administrative services including legal, tax, accounting, treasury and investor relations support. jvid视频 reimburses LMC for direct, out-of-pocket expenses incurred by LMC in providing these services and for jvid视频's allocable portion of costs associated with any shared services or personnel based on an estimated percentage of time spent providing services to jvid视频. Under the facilities sharing agreement, LMC shares office space and related amenities at its corporate headquarters with jvid视频. Under these various agreements, approximately $2 million was reimbursable to LMC for both of the three months ended September听30, 2021 and 2020, and $8 million and $7 million was reimbursable to LMC for the nine months ended September听30, 2021 and 2020, respectively. jvid视频 had a tax sharing payable to LMC and Liberty Broadband in the amount of approximately $122 million and $129 million as of September听30, 2021 and December 31, 2020, respectively, included in Other liabilities in the condensed consolidated balance sheets.听

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On November 4, 2021, jvid视频 announced that its Board of Directors declared a special cash dividend in the amount of $1.25 per common share for an aggregate cash dividend of approximately $495 million based on shares outstanding as of October 31, 2021 (to be updated for actual shares outstanding as of the record date). The dividend is payable on November 22, 2021 to stockholders of record of jvid视频鈥檚 Series A and Series B common stock as of the close of business on November 15, 2021.听

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