America Online 2010 Annual Report Download - page 60

Table of Contents
AOL INC.
PART II—ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Investing Activities
The following table presents cash provided (used) by investing activities for the periods presented (in millions):
Years Ended December 31,
2010 2009 2008
Investments and acquisitions, net of cash acquired $ (154.0) $ (18.1) $ (1,035.4)
Proceeds from disposal of assets and consolidated businesses, net 344.2 2.2 135.3
Capital expenditures and product development costs (95.9) (135.3) (172.2)
Investment activities from discontinued operations 14.8 (0.5) —
Cash provided (used) by investing activities $ 109.1 $ (151.7) $ (1,072.3)
Cash provided by investing activities was $109.1 million for the year ended December 31, 2010, as compared to cash used by investing activities of
$151.7 million for the year ended December 31, 2009. The increase in cash provided by investing activities was due to the net cash proceeds received in the
year ended December 31, 2010 from the sale of ICQ of $173.1 million and Pacific Corporate Park of $127.9 million as well as a decrease in capital
expenditures and product development costs, partially offset by an increase in cash used for acquisitions. The increase in cash used for acquisitions is due to
the acquisition of 5min Media, Thing Labs, TechCrunch, Pictela, About.me and StudioNow during 2010.
Cash used by investing activities was $151.7 million for the year ended December 31, 2009, as compared to cash used by investing activities of
$1,072.3 million for the year ended December 31, 2008. The decrease in cash used by investing activities was due to a decrease in cash used for acquisitions
as well as a decrease in capital expenditures and product development costs, partially offset by a decrease related to proceeds received in 2008 from the sale of
our United Kingdom access service business.
Capital expenditures and product development costs are mainly for the purchase of computer hardware, software, network equipment, furniture, fixtures
and other office equipment.
Financing Activities
The following table presents cash used by financing activities for the periods presented (in millions):
Years Ended December 31,
2010 2009 2008
Debt repayments $ — $ — $ (54.0)
Principal payments on capital leases (37.5) (31.1) (25.1)
Net contribution from (distribution to) Time Warner — (709.3) 210.4
Excess tax benefit on equity-based compensation — — 2.1
Tax withholdings related to net share settlements of restricted stock units (4.3) — —
Other — (9.2) 1.5
Cash provided (used) by financing activities $ (41.8) $ (749.6) $ 134.9
Cash used by financing activities was $41.8 million for the year ended December 31, 2010, compared to $749.6 million for the year ended
December 31, 2009. This change was due to the $709.3 million of net cash
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