Liberty Interactive
Liberty Interactive Corp (Form: S-4, Received: 08/31/2017 08:57:05)

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As filed with the Securities and Exchange Commission on August 31, 2017

Registration No. 333-[     ·     ]

 

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

Form S-4
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933

Liberty Interactive Corporation
(Exact name of registrant as specified in its charter)

Delaware
(State or other jurisdiction of
incorporation or organization)
  001-33982
(Primary Standard Industrial
Classification Code Number)
  84-1288730
(I.R.S. Employer
Identification No.)

12300 Liberty Blvd.
Englewood, Colorado 80112
(720) 875-5300

(Address, including zip code, and telephone number, including area code, of registrant's principal executive offices)

Richard N. Baer, Esq.
Chief Legal Officer
Liberty Interactive Corporation
12300 Liberty Boulevard
Englewood, Colorado 80112
(720) 875-5300
(Name, address, including zip code, and telephone number, including area code, of agent for service)

Copies to:

Renee L. Wilm
Jonathan Gordon
Beverly B. Reyes
Baker Botts L.L.P.
30 Rockefeller Plaza
New York, New York 10112
(212) 408-2500

 

Gregory J. Henchel
HSN, Inc.
1 HSN Drive
St. Petersburg, Florida, 33729
(727) 872-1000

 

George R. Bason, Jr.
Marc O. Williams
Davis Polk & Wardwell LLP
450 Lexington Avenue
New York, New York 10017
(212) 450-4000

Approximate date of commencement of the proposed sale of the securities to the public:
As soon as practicable after this Registration Statement becomes effective and upon completion of the applicable transactions described in the enclosed document.

            If the securities being registered on this Form are being offered in connection with the formation of a holding company and there is compliance with General Instruction G, check the following box.     o

            If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act of 1933, as amended, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.     o

            If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.     o

            Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer  ý   Accelerated filer  o   Non-accelerated filer  o
(Do not check if a
smaller reporting company)
  Smaller reporting company  o

Emerging growth company  o

            If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act.     o

            If applicable, place an X in the box to designate the appropriate rule provision relied upon in conducting this transaction:

               
 
Title of Each Class of Securities
to Be Registered

  Amount to Be
Registered(1)

  Proposed Maximum
Offering Price Per
Share

  Proposed Maximum
Aggregate Offering
Price(2)

  Amount of
Registration Fee(3)

 

Series A QVC Group common stock

  58,493,933   N/A   $1,283,321,422   $148,737

 

(1)
Represents the maximum number of shares of Series A QVC Group common stock, par value $0.01 per share (the Liberty QVCA common stock ), of the Registrant to be issued upon the completion of the merger described in the proxy statement/prospectus contained herein, and is based on the exchange ratio described in the proxy statement/prospectus contained therein multiplied by 35,450,868 (which number is equal to (i) 52,388,545 shares of common stock, par value $0.01 per share (the HSNi common stock ), of HSN, Inc. ( HSNi ) outstanding as of August 28, 2017, (ii)  minus 20,016,167 shares of HSNi common stock owned by Liberty Interactive Corporation (and its wholly owned subsidiaries) for which no shares of Liberty QVCA common stock are issuable, (iii)  plus 1,051,959 shares of HSNi common stock issuable upon settlement of deferred stock units, restricted stock units and performance share units (based on certain assumptions), 1,972,835 shares issuable upon exercise of outstanding stock appreciation rights relating to shares of HSNi common stock (based on certain assumptions), 33,644 shares issuable upon exercise of outstanding options to purchase shares of HSNi common stock under the Employee Stock Purchase Plan and 20,052 shares issuable upon exercise of outstanding stock options to purchase shares of HSNi common stock, in each case, outstanding as of August 28, 2017).

(2)
Pursuant to Rule 457(f)(1) and Rule 457(c) under the Securities Act of 1933, as amended, and solely for the purpose of calculating the registration fee, the proposed maximum aggregate offering price is the product of the average high and low prices for shares of HSNi common stock as reported on the Nasdaq Stock Market LLC on August 29, 2017 ($36.20 per share), multiplied by the estimated maximum number of shares of HSNi common stock (35,450,868) that may be exchanged or converted for the securities being registered.

(3)
Calculated on the basis of $115.90 per million of the proposed maximum aggregate offering price.

             The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the Registration Statement shall become effective on such dates as the Commission, acting pursuant to said Section 8(a), may determine.

   


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Information in this proxy statement/prospectus is not complete and may be changed. We may not sell the securities offered by this proxy statement/prospectus until the registration statement filed with the Securities and Exchange Commission is effective. This proxy statement/prospectus does not constitute an offer to sell or a solicitation of an offer to buy any securities in any jurisdiction where an offer or solicitation is not permitted.

Subject to completion, dated August 31, 2017

     
LOGO   LOGO

TRANSACTION PROPOSALS—YOUR VOTE IS VERY IMPORTANT

Dear Stockholders of HSN, Inc.:

          HSN, Inc., a Delaware corporation ( HSNi ), Liberty Interactive Corporation, a Delaware corporation ( Liberty Interactive ), and Liberty Horizon, Inc., a Delaware corporation and a direct, wholly owned subsidiary of Liberty Interactive ( Merger Sub ), have entered into an Agreement and Plan of Merger, dated as of July 5, 2017 (as may be amended from time to time, the merger agreement ), pursuant to which Liberty Interactive has agreed to acquire HSNi by way of a merger of Merger Sub with and into HSNi (the merger ), with HSNi surviving as a wholly owned subsidiary of Liberty Interactive. Liberty Interactive indirectly currently owns approximately 38.2% of the outstanding shares of HSNi's common stock, par value $0.01 per share (the HSNi common stock ), and if the merger is completed, will acquire the remaining 61.8% of shares of HSNi common stock.

          If the merger is completed, and upon the satisfaction of the conditions set forth in the merger agreement, holders of shares of HSNi common stock ( HSNi stockholders ) (other than Liberty Interactive and its wholly owned subsidiaries) will receive 1.650 shares of Liberty Interactive's Series A QVC Group common stock, par value $0.01 per share (the Liberty QVCA common stock ), in exchange for each share of HSNi common stock held by such holder immediately prior to the effective time of the merger. The market value of the Liberty QVCA common stock to be issued in the merger will fluctuate with the trading price of Liberty QVCA common stock. The exchange ratio equates to total consideration of $40.36 per share of HSNi common stock, based on the closing price of Liberty QVCA common stock on July 5, 2017, the last trading day before the public announcement of the execution of the merger agreement, and to $36.55 per share of HSNi common stock, based on the closing price of Liberty QVCA common stock on August 28, 2017, the last practicable date before the filing of the proxy statement/prospectus accompanying this notice. Liberty Interactive intends to issue approximately 53.4 million shares of Liberty QVCA common stock to HSNi stockholders, and HSNi stockholders are expected to own approximately 10.6% of the undiluted equity and 7.0% of the undiluted voting power of Liberty Interactive's QVC Group tracking stock group, in each case based on the number of shares outstanding as of July 31, 2017. Additionally, HSNi stockholders are expected to own approximately 6.0% of the undiluted voting power of Liberty Interactive as a whole, taking into account the outstanding shares of Liberty Interactive's Ventures Group tracking stock as of the same date.

          HSNi stockholders should obtain current stock price quotations for shares of HSNi common stock and shares of Liberty QVCA common stock. Shares of HSNi common stock and Liberty QVCA common stock are listed on the NASDAQ Global Select Market under the symbols "HSNi" and "QVCA," respectively. Pursuant to the terms of the merger agreement, it is a condition to the completion of the merger that the shares of Liberty QVCA common stock issuable in the merger be authorized for listing on the Nasdaq Stock Market LLC, subject to official notice of issuance.

          HSNi will be holding a special meeting of HSNi stockholders for the purpose of voting on certain matters in connection with the merger (the HSNi special meeting ). No vote of stockholders of Liberty Interactive is required in connection with the merger, nor is any such vote being sought.

          HSNi stockholders as of the close of business on [     ·     ], 2017, the record date of the HSNi special meeting, are cordially invited to attend a special meeting of HSNi stockholders to be held on [date], 2017, at [location], [city], at [     ·     ] [a.m. / p.m.], local time. HSNi is holding the HSNi special meeting in order to obtain the stockholder approval necessary to approve the merger agreement (the merger agreement proposal ), as well as certain other matters. Pursuant to the terms of the merger agreement and applicable law, the approval of the merger agreement proposal is a condition to the completion of the merger.

          The HSNi board of directors, acting on the recommendation of a special committee thereof, has determined that the merger and the other transactions contemplated by the merger agreement are fair to, and in the best interests of, HSNi and its stockholders, and has approved and declared advisable the merger agreement and the transactions contemplated thereby, including the merger, and recommends that HSNi stockholders vote " FOR " the merger agreement proposal and " FOR " each of the other proposals described in the accompanying proxy statement/prospectus. Liberty Interactive has agreed to vote all of the shares of HSNi common stock beneficially owned by it (constituting approximately 38.2% of the issued and outstanding shares of HSNi common stock as of August 28, 2017) in favor of the merger agreement proposal and in favor of any other matter necessary to consummate the merger, on the terms and subject to the conditions set forth in the merger agreement.

           Your vote is important, regardless of the number of shares you own. Whether or not you plan to attend the HSNi special meeting, please vote as soon as possible to make sure that your shares are represented. Submitting a proxy now will not prevent you from being able to vote in person at the HSNi special meeting.

           Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of the merger, the adoption of the merger agreement, the issuance of the shares of Liberty QVCA common stock in the merger, or any of the other transactions described in the accompanying proxy statement/prospectus or determined if this proxy statement/prospectus is truthful or complete. Any representation to the contrary is a criminal offense.

           The obligations of HSNi and Liberty Interactive to complete the merger are subject to the satisfaction or waiver of the conditions set forth in the merger agreement, a copy of which is included as part of the accompanying proxy statement/prospectus. The proxy statement/prospectus provides you with detailed information about the proposed merger. It also contains or references information about HSNi and Liberty Interactive and certain related matters. You are encouraged to read the proxy statement/prospectus carefully and in its entirety. In particular, you should carefully read the section entitled "Risk Factors" beginning on page 30 of the proxy statement/prospectus for a discussion of risks you should consider in evaluating the proposed merger and the issuance of shares of Liberty QVCA common stock in connection with the merger and how they will affect you.

          Thank you for your cooperation and we look forward to the successful completion of the merger.

Very truly yours,   Very truly yours,

Gregory B. Maffei
President and Chief Executive Officer ,
Liberty Interactive Corporation

 

Arthur C. Martinez
Chairman of the Board ,
HSN, Inc.

           The accompanying proxy statement/prospectus is dated [     ·     ], 2017 and is first being mailed to the HSNi stockholders of record as of the close of business on [     ·     ], 2017.


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LOGO

HSN, INC.
1 HSN Drive
St. Petersburg, FL 33729
(727) 872-1000

NOTICE OF SPECIAL MEETING OF STOCKHOLDERS
TO BE HELD ON [    
·     ]
AT [    
·     ], LOCAL TIME

         NOTICE IS HEREBY GIVEN that a special meeting of stockholders (the HSNi special meeting ) of HSN, Inc. ( HSNi ) will be held on [     ·     ], at [     ·     ], local time, at [     ·     ], for the following purposes:

        Pursuant to the merger agreement and applicable law, approval of the merger agreement proposal at the HSNi special meeting is required to complete the merger of Merger Sub with and into HSNi (the merger ), with HSNi continuing as the surviving corporation and a wholly owned subsidiary of Liberty Interactive. HSNi stockholders will also be asked to approve the adjournment proposal and the non-binding compensation advisory proposal; however, approval of the adjournment proposal and the nonbinding compensation advisory proposal is not required to complete the merger. HSNi will transact no other business at the HSNi special meeting except as set forth above. The record date for the HSNi special meeting has been set as of the close of business on [     ·     ]. Only HSNi stockholders of record as of the close of business on such record date are entitled to notice of, and to vote at, the HSNi special meeting or any adjournments and postponements thereof. See "The HSNi Special Meeting" of the proxy statement/prospectus accompanying this notice for additional information.

        The HSNi board of directors, acting on the recommendation of a special committee thereof, has determined that the merger agreement and the transactions contemplated thereby, including the merger, are advisable and fair to, and in the best interests of, HSNi and its stockholders, and has approved and declared advisable the merger agreement and the transactions contemplated thereby, including the merger, and recommends that HSNi stockholders vote " FOR " the merger agreement proposal, " FOR " the adjournment proposal if necessary to solicit additional proxies in favor of the approval of the merger agreement and " FOR " the non-binding compensation advisory proposal. Liberty Interactive has agreed to vote all of the shares of HSNi common stock beneficially owned by it (constituting approximately 38.2% of the issued and outstanding shares of HSNi common stock as of August 28, 2017) in favor of the merger agreement proposal and in favor of any other matter necessary to consummate the merger, on the terms and subject to the conditions set forth in the merger agreement.


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        The proposals to be considered at the HSNi special meeting are described in more detail in the accompanying proxy statement/prospectus, which you should read carefully in its entirety before you vote. A copy of the merger agreement is attached as Annex A to the accompanying proxy statement/prospectus.

         PLEASE VOTE AS PROMPTLY AS POSSIBLE, WHETHER OR NOT YOU PLAN TO ATTEND THE HSNi SPECIAL MEETING. IF YOU LATER DESIRE TO REVOKE OR CHANGE YOUR PROXY FOR ANY REASON, YOU MAY DO SO IN THE MANNER DESCRIBED IN THE ACCOMPANYING PROXY STATEMENT/PROSPECTUS. FOR FURTHER INFORMATION CONCERNING THE PROPOSALS BEING VOTED UPON, USE OF THE PROXY AND OTHER RELATED MATTERS, YOU ARE URGED TO READ THE ACCOMPANYING PROXY STATEMENT/PROSPECTUS.

Your vote is important. Adoption of the merger agreement by the HSNi stockholders is a condition to the merger and requires the affirmative vote, in person or by proxy, of holders of a majority of the aggregate voting power of HSNi common stock outstanding and entitled to vote on such proposal, voting together as a single class. Adoption of the other proposals to be presented at the HSNi special meeting requires the affirmative vote of holders of a majority of the votes cast affirmatively or negatively on such proposals. HSNi stockholders are requested to complete, date, sign and return the enclosed proxy card in the envelope provided, which requires no postage if mailed in the United States, or to submit their votes electronically via the Internet or by telephone. Simply follow the instructions provided on the enclosed proxy card. Your abstaining, failure to submit a proxy or vote in person at the HSNi special meeting, or failure to provide your broker, nominee, fiduciary or other custodian, as applicable, with instructions on how to vote your shares will have the same effect as a vote "AGAINST" the adoption of the merger agreement, but it will have no effect on the adjournment proposal and the non-binding compensation advisory proposal, in each case assuming a quorum is present

 

    BY ORDER OF THE BOARD OF DIRECTORS OF HSN, INC.,

 

 

Arthur C. Martinez
Chairman of the Board

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ADDITIONAL INFORMATION

        This proxy statement/prospectus incorporates important business and financial information from other documents that HSN, Inc. ( HSNi ) and Liberty Interactive Corporation ( Liberty Interactive ) have filed with the Securities and Exchange Commission (the SEC ). For a listing of documents incorporated by reference herein, please see "Additional Information—Where You Can Find More Information." This information is available for you to review without charge at the SEC's public reference room located at 100 F Street, N.E., Room 1580, Washington, D.C. 20549 and through the SEC's website at www.sec.gov. You can obtain copies of this proxy statement/prospectus and any of the documents incorporated by reference in this proxy statement/prospectus or other information about HSNi or Liberty, without charge, upon written or oral request to the applicable company's principal executive office or proxy solicitor, as applicable, which are as follows:


Liberty Interactive Corporation
12300 Liberty Blvd.
Englewood, Colorado 80112
(720) 875-5300
Attn.: Investor Relations

 

HSN, Inc.
1 HSN Drive
St. Petersburg, Florida, 33729
(727) 872-1000
Attn.: Investor Relations
ir@hsn.net
or
Georgeson LLC
1290 Avenue of the Americas, 9th Floor
New York, NY 10104
(888) 206-5896

        Investors may also consult the websites of Liberty Interactive or HSNi for more information concerning the merger described in this proxy statement/prospectus. The website of HSNi is www.hsni.com and the website of Liberty Interactive is www.libertyinteractive.com. Information included on these websites is not incorporated by reference into this proxy statement/prospectus.

         If you would like to request any documents, please do so at least five business days before HSNi's special meeting of stockholders, in order to receive them before the special meeting.

        For more information, see "Additional Information—Where You Can Find More Information."

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ABOUT THIS PROXY STATEMENT/PROSPECTUS

        This proxy statement/prospectus, which forms part of a registration statement on Form S-4 filed with the SEC by Liberty Interactive (File No. 333-[     ·     ]), constitutes a prospectus of Liberty Interactive under Section 5 of the Securities Act of 1933, as amended, with respect to the shares of Liberty Interactive's Series A QVC Group common stock, par value $0.01 per share, to be issued to the stockholders of HSNi in the merger of a wholly owned subsidiary of Liberty Interactive with and into HSNi, with HSNi becoming a wholly owned subsidiary of Liberty Interactive (the merger ). This document also constitutes a proxy statement of HSNi under Section 14(a) of the Securities Exchange Act of 1934, as amended. It also constitutes a notice of meeting with respect to a special meeting of holders of HSNi common stock, at which such holders will be asked to vote upon a proposal to approve the merger and certain related matters.

        You should rely only on the information contained or incorporated by reference into this proxy statement/prospectus in connection with any vote, the giving or withholding of any proxy or any investment decision in connection with the merger. Neither Liberty Interactive nor HSNi have authorized anyone to provide you with information that is different from that contained in, or incorporated by reference into, this proxy statement/prospectus. This proxy statement/prospectus is dated [     ·     ], 2017. You should not assume that the information contained in, or incorporated by reference into, this proxy statement/prospectus is accurate as of any date other than such date, unless otherwise specifically provided herein, and you should not assume that the information incorporated by reference herein is accurate as of any date other than the date of the incorporated document. Neither our mailing of this proxy statement/prospectus to HSNi stockholders nor the issuance of shares in the merger will create any implication to the contrary.

         This proxy statement/prospectus does not constitute an offer to sell, or a solicitation of an offer to buy, any securities, or the solicitation of a proxy, in any jurisdiction in which or from any person to whom it is unlawful to make any such offer or solicitation in such jurisdiction. Information contained in this proxy statement/prospectus regarding Liberty Interactive has been provided by Liberty Interactive, and information contained in this proxy statement/prospectus regarding HSNi has been provided by HSNi.

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QUESTIONS AND ANSWERS

    1  

SUMMARY

    16  

The Companies

    16  

The Merger

    18  

SELECTED FINANCIAL DATA OF LIBERTY INTERACTIVE AND HSNi

    19  

Selected Historical Financial Data of Liberty Interactive

    19  

Selected Historical Financial Data of HSNi

    20  

UNAUDITED COMPARATIVE PER SHARE INFORMATION

    22  

QVC Group Common Stock Historical Per Share Data

    22  

HSNi Common Stock Historical Per Share Data

    22  

QVC Group Pro Forma Per Share Data

    23  

COMPARATIVE PER SHARE MARKET PRICE AND DIVIDEND INFORMATION

    24  

Liberty Interactive Market Price

    24  

HSNi Market Price

    25  

Dividends

    26  

Comparison of Liberty QVCA Common Stock and HSNi Market Prices and Implied Value of Share Value of the Stock Consideration

    27  

CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING STATEMENTS

    28  

RISK FACTORS

    30  

Risks Relating to the Merger

    30  

Risks Relating to the Combined Company After Completion of the Merger

    40  

INFORMATION ABOUT THE MERGER

    42  

Background of the Merger

    42  

Liberty Interactive's Purpose and Reasons for the Merger

    56  

HSNi's Purpose and Reasons for the Merger and Other Proposals; Recommendations of the Special Committee and HSNi Board; Fairness of the Merger

    59  

Unaudited Forecasted Financial Information

    64  

Opinion of the Special Committee Financial Advisor (Centerview Partners)

    70  

Opinion of the Special Committee Financial Advisor (Goldman Sachs)

    81  

Interests of Certain Persons of HSNi in the Merger

    91  

Effect of the Merger on HSNi Stockholders; What HSNi Stockholders Will Receive in the Merger

    96  

Amount and Source of Funds and Financing of the Merger; Expenses

    97  

Accounting Treatment

    97  

Regulatory Approvals

    97  

No Appraisal Rights

    99  

The Merger Agreement

    99  

The Rights Plan Amendment

    117  

COMPARISON OF STOCKHOLDERS' RIGHTS

    118  

THE HSNi SPECIAL MEETING

    133  

Time, Place and Date

    133  

Purpose of the HSNi Special Meeting

    133  

Recommendation of the HSNi Board

    133  

HSNi Record Date; Stock Entitled to Vote

    133  

Quorum

    133  

Required Vote

    134  

Outstanding Shares

    134  

Voting Procedures for Record Holders

    134  

Revoking a Proxy

    135  

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Proxy Solicitation Costs

    135  

Other Information

    136  

Assistance

    136  

Vote of HSNi's Directors and Executive Officers

    136  

Vote of Liberty Interactive

    136  

Attending the HSNi Special Meeting

    137  

Stockholder List

    137  

Results of the HSNi Special Meeting

    137  

Householding

    137  

HSNi PROPOSALS

    139  

HSNi Proposal 1: The Merger Agreement Proposal

    139  

HSNi Proposal 2: The Adjournment Proposal

    139  

HSNi Proposal 3: The Non-Binding Compensation Advisory Proposal

    140  

SECURITY OWNERSHIP OF CERTAIN HSNi BENEFICIAL OWNERS AND MANAGEMENT/DIRECTORS OF HSNi

    141  

Security Ownership of Officers and Directors

    141  

Security Ownership of Other Beneficial Owners

    142  

CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS

    144  

Relationship Between HSNi and Liberty Interactive

    144  

MATERIAL U.S. FEDERAL INCOME TAX CONSEQUENCES

    147  

ADDITIONAL INFORMATION

    150  

Legal Matters

    150  

Experts

    150  

Stockholder Proposals

    150  

Where You Can Find More Information

    151  

INDEX TO FINANCIAL STATEMENTS

    F-1  

ANNEX A: AGREEMENT AND PLAN OF MERGER

    A-1  

ANNEX B: AMENDMENT NO. 1 TO RIGHTS AGREEMENT

    B-1  

ANNEX C: OPINION OF CENTERVIEW PARTNERS LLC

    C-1  

ANNEX D: OPINION OF GOLDMAN SACHS & CO. LLC

    D-1  

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QUESTIONS AND ANSWERS

         The questions and answers below highlight only selected information about the merger, the merger agreement and the HSNi special meeting, and how to vote your shares of HSNi common stock. These questions and answers may not address all questions that may be important to you as an HSNi stockholder. You should carefully read the entire proxy statement/prospectus, including the Annexes and the additional documents incorporated by reference herein, to fully understand the proposals being considered at the HSNi special meeting.

Q:
Why am I receiving this document?

A:
This document is being delivered to you because HSN, Inc., a Delaware corporation ( HSNi ), is holding a special meeting (the HSNi special meeting ) of holders of shares of its common stock, par value $0.01 per share (the HSNi common stock ), in connection with a proposed merger to be effected pursuant to the Agreement and Plan of Merger, dated as of July 5, 2017, by and among Liberty Interactive Corporation, a Delaware corporation ( Liberty Interactive ), Liberty Horizon, Inc., a Delaware corporation and a direct, wholly owned subsidiary of Liberty Interactive ( Merger Sub ), and HSNi (as may be amended from time to time, the merger agreement ).

Pursuant to the merger agreement, on the terms and subject to the conditions set forth therein, Liberty Interactive has agreed to acquire HSNi by means of a merger (the merger ) of Merger Sub with and into HSNi, with HSNi surviving the merger as a wholly owned subsidiary of Liberty Interactive (the surviving corporation ). The merger agreement must be adopted by the holders of shares of HSNi common stock (the HSNi stockholders ) in accordance with the General Corporation Law of the State of Delaware (the DGCL ) in order for the merger to be consummated. At the HSNi special meeting, the HSNi stockholders will consider and vote on a proposal to adopt the merger agreement, along with certain other matters described in this proxy statement/prospectus.

If the merger is completed, the surviving corporation will become a wholly owned subsidiary of Liberty Interactive, and HSNi will no longer be a publicly traded company.

Q:
What will HSNi stockholders receive in the merger?

A:
In the merger, each HSNi stockholder (other than Liberty Interactive or any of its wholly owned subsidiaries) will receive 1.650 shares (the exchange ratio ) of validly issued, fully paid and non-assessable shares of Liberty Interactive's Series A QVC Group common stock, par value $0.01 per share (the Liberty QVCA common stock , and the shares of Liberty QVCA common stock to be received by each HSNi stockholder in the merger, the merger consideration ), for each share of HSNi common stock held by such holder. The exchange ratio is fixed and will not reflect changes in the price of HSNi common stock or Liberty QVCA common stock prior to the closing of the merger. Based on the closing price of shares of Liberty QVCA common stock on the NASDAQ Global Select Market ( Nasdaq ) on July 5, 2017, the last trading day before public announcement of the merger agreement, the exchange ratio represented approximately $40.36 in shares of Liberty QVCA common stock for each share of HSNi common stock, and, based on the closing price of shares of Liberty QVCA common stock on August 28, 2017, the last practicable date before the filing of this proxy statement/prospectus, the exchange ratio represented approximately $36.55 in shares of Liberty QVCA common stock. The exchange ratio is subject to customary anti-dilution adjustments, such as in the event of a stock split or of a stock dividend on shares of Liberty QVCA common stock.

Each share of HSNi common stock held by Liberty Interactive or any of its wholly owned subsidiaries will be converted into one validly issued, fully paid and non-assessable share of common stock, par value $0.01 per share, of the surviving corporation.

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    Each share of HSNi common stock held by HSNi as treasury stock will be cancelled and will cease to exist.

    Liberty Interactive intends to issue approximately 53.4 million shares of Liberty QVCA common stock to HSNi stockholders, and HSNi stockholders are expected to own approximately 10.6% of the undiluted equity and 7.0% of the undiluted voting power of Liberty Interactive's QVC Group tracking stock group (the QVC Group ), in each case, based on the number of shares outstanding as of July 31, 2017. Additionally, HSNi stockholders are expected to own approximately 6.0% of the undiluted voting power of Liberty Interactive as a whole, taking into account the outstanding shares of Liberty Interactive's Ventures Group tracking stock outstanding as of the same date. The exact equity and voting stake of HSNi stockholders in Liberty Interactive immediately following the merger will depend on the number of shares of HSNi common stock and common stock of Liberty Interactive outstanding at that time. See "Summary—The Companies—Liberty Interactive Corporation" for a discussion of Liberty Interactive's tracking stock structure.

Q:
What will the relationship be between HSNi and Liberty Interactive after the completion of the merger?

A:
If the merger is completed, the surviving corporation will become a wholly owned subsidiary of Liberty Interactive. As a result of the merger, HSNi will no longer be a publicly held company. Following the merger, shares of HSNi common stock will be delisted from Nasdaq and deregistered under the Securities Exchange Act of 1934, as amended (the Exchange Act ).

Q:
What will happen to stock-based awards with respect to shares of HSNi common stock granted by HSNi to employees and non-employee directors?

A:
Stock Options.     At the effective time of the merger (the effective time ), each option to purchase shares of HSNi common stock (an HSNi stock option ) that is outstanding as of immediately prior to the effective time, whether vested or unvested, will be converted into an option to purchase a number of shares of Liberty QVCA common stock equal to the product of (i) the number of shares of HSNi common stock subject to such HSNi stock option immediately prior to the effective time and (ii) the exchange ratio, rounded down to the nearest whole share, at an exercise price per share determined by dividing the per-share exercise price of the HSNi stock option immediately prior to the effective time by the exchange ratio (rounding the resulting quotient up to the nearest whole cent). Following such adjustment, any restrictions applicable to the exercise of an HSNi stock option will continue in full force and effect and the terms, exercisability, vesting schedules and other provisions will remain unchanged.

Stock Appreciation Rights.     At the effective time, each stock appreciation right with respect to shares of HSNi common stock (an HSNi SAR ) that is outstanding as of immediately prior to the effective time, whether vested or unvested, will be converted into a stock appreciation right with respect to a number of shares of Liberty QVCA common stock equal to the product of (i) the number of shares of HSNi common stock subject to such HSNi SAR immediately prior to the effective time and (ii) the exchange ratio, rounded down to the nearest whole share, at an exercise price per share determined by dividing the exercise price of such HSNi SAR immediately prior to the effective time by the exchange ratio (rounding the resulting quotient up to the nearest whole cent). Following such adjustment, any restrictions applicable to the exercise of an HSNi SAR will continue in full force and effect and the terms, exercisability, vesting schedules and other provisions will remain unchanged.

Restricted Stock Units.     At the effective time, each award of restricted stock units with respect to shares of HSNi common stock (an HSNi RSU ) that is outstanding as of immediately prior to the effective time, that is subject to time-based vesting, will be converted into an award of restricted

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    stock units with respect to a number of shares of Liberty QVCA common stock equal to the product of (i) the number of shares of HSNi common stock subject to such HSNi RSU immediately prior to the effective time and (ii) the exchange ratio, rounded to the nearest whole share. Following such adjustment, any vesting conditions and restrictions on the receipt of an HSNi RSU will continue in full force and effect and the terms, vesting schedules and other provisions will remain unchanged.

    Performance Share Units.     At the effective time, each award of performance share units with respect to shares of HSNi common stock (an HSNi PSU ) that is outstanding as of immediately prior to the effective time of the merger will be converted into an award of performance share units with respect to a target number of shares of Liberty QVCA common stock equal to the product of (i) the target number of shares of HSNi common stock subject to such HSNi PSU immediately prior to the effective time and (ii) the exchange ratio, rounded to the nearest whole share. Following such adjustment, any vesting conditions and restrictions on the receipt of an HSNi PSU will continue in full force and effect and the terms, vesting schedules and other provisions will remain unchanged.

Q:
Will the rights associated with my shares of HSNi common stock change as a result of the merger?

A:
Yes. Liberty QVCA common stock is a tracking stock of Liberty Interactive. Accordingly, Liberty QVCA common stock includes terms that are specific to a tracking stock and would not typically apply to a regular common stock, such as conversion at the option of the issuer, redemption for stock of a subsidiary, mandatory conversion, inter-group interests, and certain redemption or dividend requirements upon an asset disposition. None of these tracking stock-specific terms apply to HSNi common stock. In addition, HSNi stockholders will have different rights once they become holders of Liberty QVCA common stock due to the differences between the governing documents of HSNi and Liberty Interactive, including:

voting rights;

proposals at annual and special meetings of stockholders; and

amendments to governing documents.

    For additional information regarding the Liberty QVCA common stock, see "Comparison of Stockholders' Rights."

Q:
What happens if the market price of shares of Liberty QVCA common stock or HSNi common stock changes prior to the closing of the merger?

A:
No change will be made to the exchange ratio if the market price of Liberty QVCA common stock or HSNi common stock changes prior to the closing of the merger. Because the exchange ratio is fixed, the value of the shares of Liberty QVCA common stock to be received by HSNi stockholders in the merger will depend solely on the market price of shares of Liberty QVCA common stock at the effective time.

Q:
Will Liberty Interactive issue fractional shares of Liberty QVCA common stock in the merger?

A:
Liberty Interactive will not issue fractional shares of Liberty QVCA common stock in the merger. To the extent that the merger would result in an HSNi stockholder being issued a fractional share, such HSNi stockholder will instead receive a cash payment in an amount based on the aggregation and sale of all fractional shares by Liberty Interactive's exchange agent for the merger at prevailing market prices on behalf of such HSNi stockholder. Amounts payable in lieu of such fractional shares will be payable from the proceeds of the aggregation and sale of the fractional shares as

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    soon as practicable following the completion of the merger. No HSNi stockholder will be entitled to dividends, voting rights or any other rights with respect to any fractional shares.

Q:
What are the U.S. federal income tax consequences of the merger to HSNi stockholders?

A:
It is intended that, for U.S. federal income tax purposes, the merger will qualify as a "reorganization" within the meaning of Section 368(a) of the Internal Revenue Code of 1986, as amended (the Code ), which we refer to as the Intended Tax Treatment . However, the completion of the merger is not conditioned on the merger qualifying for the Intended Tax Treatment or upon the receipt of an opinion of counsel to that effect. In addition, neither Liberty Interactive nor HSNi intends to request a ruling from the Internal Revenue Service (the IRS ) regarding the U.S. federal income tax consequences of the merger. Accordingly, no assurance can be given that the merger will qualify for the Intended Tax Treatment. Further, even if Liberty Interactive and HSNi conclude that the merger qualifies for the Intended Tax Treatment, no assurance can be given that the IRS will not challenge that conclusion or that a court would not sustain such a challenge.

Assuming the merger qualifies for the Intended Tax Treatment, U.S. Holders (as defined in the section entitled "Material U.S. Federal Income Tax Consequences" below) of HSNi common stock will not recognize any gain or loss upon the receipt of shares of Liberty QVCA common stock in the merger, except with respect to cash received in lieu of a fractional share of Liberty QVCA common stock.

If, at the effective time of the merger, any requirement for the merger to qualify for the Intended Tax Treatment is not satisfied, a U.S. Holder of HSNi common stock would generally recognize gain or loss in an amount equal to the difference between (i) the sum of the fair market value of the shares of Liberty QVCA common stock received in the merger and the amount of any cash received in lieu of a fractional share of Liberty QVCA common stock pursuant to the merger and (ii) such holder's basis in the shares of HSNi common stock surrendered.

Each HSNi stockholder should read the discussion under "Material U.S. Federal Income Tax Consequences" and should consult its own tax advisor for a full understanding of the tax consequences of the merger to such stockholder.

Q:
Is the completion of the merger subject to any conditions?

A:
Yes. The completion of the merger depends on the satisfaction or, if applicable, waiver, of a number of conditions, including:

the receipt of the requisite approval of the HSNi stockholders of the merger agreement proposal;

the expiration or termination of any applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (the HSR Act ), and the receipt of approval of the Federal Communications Commission (the FCC ) of certain applications for transfer of control and/or assignment of certain FCC licenses, authorizations and registrations (the FCC Approvals );

the absence of any judgment, order, writ, injunction or decree that prohibits, renders illegal or permanently enjoins the consummation of the merger;

the effectiveness of the registration statement on Form S-4 of which this proxy statement/prospectus forms a part, and there being no stop order or proceedings relating thereto; and

the approval of Nasdaq for the listing of the shares of Liberty QVCA common stock to be issued in the merger.

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    For more information, please see "Information About the Merger—The Merger Agreement—Conditions to the Completion of the Merger."

Q:
What regulatory approvals are required to complete the merger?

A:
The completion of the merger is conditioned on, among other things, the expiration or termination of any applicable waiting period under the HSR Act. In addition, Liberty Interactive's obligation to effect the merger is conditioned upon the receipt of the FCC Approvals.

Under the terms of the merger agreement, each of Liberty Interactive and HSNi agreed to use their respective reasonable best efforts to obtain all necessary regulatory approvals, provided that neither party is required to agree to any requirement to sell or otherwise dispose of any asset or business that would materially adversely affect such party (but, in the case of Liberty Interactive, with respect to the QVC Group only), or would prohibit or materially limit the ownership, control or operation by such party of its respective businesses or assets (but, in the case of Liberty Interactive, with respect to the QVC Group only).

For more information, please see "Information About the Merger—Regulatory Approvals."

Q:
Can HSNi solicit alternative transactions?

A:
No. HSNi is subject to a "no-shop" restriction that limits its ability to solicit alternative transaction proposals from, or engage in discussions with, third parties, except under limited circumstances to permit the board of directors of HSNi (the HSNi board ) to comply with its fiduciary duties under applicable law.

Under the terms of the merger agreement, HSNi may not, and agreed to cause each of its representatives and subsidiaries not to, solicit certain alternative transaction proposals (as further discussed herein) or engage in activities, discussions or negotiations with third parties with respect to certain alternative transaction proposals, unless the HSNi board receives a bona fide written proposal that (i) did not result from a breach of HSNi's non-solicitation obligations and (ii) in the good faith determination of the HSNi board, is or is reasonably expected to result in a superior transaction proposal (as further discussed herein). In the case of such a superior transaction proposal or an intervening event (as further discussed herein), the HSNi board may change its recommendation with respect to the merger, or, solely in the case of a superior transaction proposal, HSNi may terminate the merger agreement and enter into a definitive transaction agreement with respect to such superior transaction proposal, if, in either case, the HSNi board believes that the failure to take such action with respect to the merger would be likely to be inconsistent with its fiduciary duties under applicable law.

If the HSNi board intends to change its recommendation with respect to the merger as a result of a superior transaction proposal or intervening event, or to terminate the merger agreement in order to enter concurrently into a definitive agreement with respect to a superior transaction proposal, it must first negotiate in good faith with Liberty Interactive for at least four business days to modify the merger agreement such that the failure to change its recommendation or terminate the merger agreement, as applicable, would no longer be likely to constitute a breach of its fiduciary duties under applicable law.

For more information, see "Information About the Merger—The Merger Agreement—No Solicitation."

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Q:
Can the merger agreement be terminated by the parties?

A:
Yes. The merger agreement may be terminated prior to the effective time of the merger, whether before or after the receipt of the required approval of the HSNi stockholders:

by mutual written consent of each of Liberty Interactive, Merger Sub and HSNi;

by either Liberty Interactive or HSNi, if the merger is not consummated on or before April 5, 2018 (the outside date ), provided that either party may extend the outside date for a period of six months upon written notice to the other party if all conditions to the closing of the merger have been satisfied or waived, or are capable of being satisfied, other than conditions relating to antitrust approval or the receipt of the FCC Approvals;

by either Liberty Interactive or HSNi, if there is a final, non-appealable judgment, order, writ, injunction or decree by any governmental authority permanently restraining, enjoining or otherwise prohibiting the merger; or

by either Liberty Interactive or HSNi, if the required approval of the HSNi stockholders is not obtained at a meeting of the HSNi stockholders at which a final vote was taken, provided that the party seeking to terminate the merger agreement following the failure to obtain such stockholder approval is not in material breach of its obligations under the merger agreement.

    The merger agreement may also be terminated by HSNi:

    prior to the receipt of the required approval of the HSNi stockholders, in order for HSNi to enter concurrently into a definitive written agreement with respect to a superior transaction proposal; or

    provided that HSNi is not in material breach of any of its obligations under the merger agreement, there is any continuing breach in the representations and warranties of Liberty Interactive or Merger Sub, or Liberty Interactive is failing to perform any of its covenants or other agreements under the merger agreement that would cause certain conditions to the completion of the merger to not be satisfied, subject to a cure period.

    The merger agreement may also be terminated by Liberty Interactive:

    prior to the receipt of the required approval of the HSNi stockholders, if the HSNi board changes its recommendation with respect to the merger, or HSNi materially breaches or fails to perform its non-solicitation obligations and such breach or failure to perform leads to or results in an alternative transaction proposal; or

    provided that neither Liberty Interactive nor Merger Sub is in material breach of any of its obligations under the merger agreement, there is any continuing breach in the representations and warranties of HSNi, or HSNi is materially failing to perform any of its covenants or other agreements under the merger agreement that would cause certain conditions to the completion of the merger to not be satisfied, subject to a cure period.

Q:
Are there any fees payable by the parties in connection with a termination of the merger agreement?

A:
Yes, in certain circumstances. Subject to the terms and conditions of the merger agreement, HSNi will pay Liberty Interactive a one-time termination fee of $40 million if (i) HSNi terminates the merger agreement to enter concurrently into a definitive agreement with respect to a superior transaction proposal, (ii) Liberty Interactive terminates the merger agreement as a result of (x) the HSNi board changing its recommendation with respect to the merger or (y) HSNi materially breaching or failing to perform its non-solicitation obligations, and such breach or failure to perform leads to or results in an alternative transaction proposal, or (iii) (A) an alternative

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    transaction proposal is made to HSNi, (B) the merger agreement is terminated (1) by HSNi or Liberty Interactive due to the failure to consummate the merger by the outside date, (2) by HSNi or Liberty Interactive due to the failure of the HSNi stockholders to approve the merger or (3) by Liberty Interactive due to HSNi's breach of its covenants in a way that prevents satisfaction of certain closing conditions, subject to a cure period, and (C) within fifteen (15) months of such termination, HSNi enters into an agreement for an alternative transaction that meets certain requirements (as further discussed herein) and such alternative transaction is later consummated.

    Subject to the terms and conditions of the merger agreement, Liberty Interactive will pay HSNi a one-time termination fee of $75 million (i) if the merger has not been consummated on or before the outside date (as it may be extended) as a result of the required regulatory approvals having not been obtained or (ii) if any court or other governmental authority has issued an order or taken any other action permanently restraining, enjoining or otherwise prohibiting the merger under any competition law or the Communications Act of 1934, as amended (the Communications Act ), and such order or other action is, or has become, final and non-appealable, and, in each case, all other mutual conditions and the conditions of Liberty Interactive and Merger Sub to the completion to the merger are satisfied or capable of being satisfied.

    For more information, see "Information About the Merger—The Merger Agreement—Termination Fees."

Q:
When do you expect the merger to be completed?

A:
Liberty Interactive and HSNi currently expect to complete the merger during the fourth quarter of calendar year 2017. However, the merger is subject to various conditions, including applicable regulatory and stockholder approvals, and it is possible that factors outside of the control of Liberty Interactive and HSNi could result in the merger being completed at a later time, or not at all. There may be a substantial amount of time between the HSNi special meeting and the completion of the merger.

For more information, see "Information About the Merger—The Merger Agreement—Conditions to the Completion of the Merger."

Q:
What happens to the HSNi stockholder rights plan as a result of the merger agreement and the merger?

A:
In connection with the merger, on July 5, 2017, HSNi entered into an amendment (the rights plan amendment ) to the Rights Agreement, dated as of December 23, 2008 (the HSNi rights plan ), by and between HSNi and Computershare Trust Company, N.A., as successor-in-interest to The Bank of New York Mellon, a New York banking corporation. Among other things, the rights plan amendment (i) exempts the approval, execution, delivery and performance of the merger agreement and the other contracts or instruments related thereto, and the announcement and the consummation of the merger, such that the rights issued under the HSNi rights plan to acquire shares of HSNi common stock ( the HSNi rights ) will not become exercisable, and (ii) provides for the expiration of the HSNi rights in their entirety, and the termination of the HSNi rights plan immediately prior to the effective time (but only if the effective time occurs) without any consideration payable therefor or in respect thereof.

Q:
What will happen to Liberty Interactive and the QVC Group following Liberty Interactive's previously announced transaction with General Communication, Inc.?

A:
On April 4, 2017, Liberty Interactive, Liberty Interactive LLC, a Delaware limited liability company and a direct, wholly owned subsidiary of Liberty Interactive ( Liberty LLC ), and General Communication, Inc., an Alaska corporation ( GCI ), entered into an agreement (the GCI

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    reorganization agreement ) whereby Liberty Interactive agreed, on the terms and subject to the conditions set forth therein, to acquire GCI through a reorganization in which certain assets and liabilities currently attributed to Liberty Interactive's Ventures Group tracking stock group (the Ventures Group ) will be contributed to GCI in exchange for a controlling interest in GCI. Liberty Interactive would then effect a tax-free split-off of its controlling interest in the combined company (to be named GCI Liberty, Inc. ( GCI Liberty )) to the holders of shares of Liberty Interactive's Series A Liberty Ventures common stock, par value $0.01 per share ( LVNTA ), and Series B Liberty Ventures common stock, par value $0.01 per share ( LVNTB , and together with LVNTA, the Liberty Ventures common stock ), in full redemption of all outstanding shares of Liberty Ventures common stock. The transactions contemplated by the GCI reorganization agreement (the GCI transactions ) currently are expected to be consummated during the fourth quarter of 2017, subject to the satisfaction or waiver, if applicable, of all closing conditions set forth in the GCI reorganization agreement. The completion of the merger is not a condition to the completion of the GCI transactions, nor is the completion of the GCI transactions a condition to the completion of the merger.

    Following the completion of the GCI transactions, Liberty Interactive will be renamed "QVC Group, Inc." and the QVC Group common stock (as defined below) will become an asset-backed security. In addition, Liberty Interactive expects to submit to its stockholders at its first annual meeting following the closing of the GCI transactions an amendment to its certificate of incorporation which would eliminate all of the tracking stock-specific terms and provisions of the QVC Group common stock. For additional information regarding those provisions which are specific to Liberty Interactive's tracking stock structure, see "Comparison of Stockholders' Rights."

Q:
What is the accounting treatment for the merger?

A:
In accordance with accounting principles generally accepted in the United States ( GAAP) , the merger will be accounted for by Liberty Interactive under the acquisition method of accounting for business combinations.

Q:
What is the dividend policy of HSNi pending completion of the merger?

A:
Under the terms of the merger agreement, HSNi is permitted to continue to pay regular quarterly cash dividends to HSNi stockholders in an amount not to exceed $0.35 per share of HSNi common stock per fiscal quarter, provided that such dividends will not be paid using funds borrowed specifically for that purpose. Other than such regular quarterly cash dividends, HSNi has agreed not to (i) declare, set aside, make or pay any other dividend or make any other distribution (whether payable in cash, stock, property or a combination thereof) with respect to any of its capital stock, (ii) reclassify, combine, split or subdivide any of its capital stock or (iii) redeem, purchase or otherwise acquire any equity interest in HSNi or any of its subsidiaries.

Q:
When and where will the HSNi special meeting be held?

A:
The HSNi special meeting will be held at [location], on [date], at [time], local time.

Q:
Who is entitled to vote at the HSNi special meeting and how many votes do I have?

A:
The HSNi board has fixed [     ·     ] as the record date for the HSNi special meeting (the HSNi record date ). All holders of record of shares of HSNi common stock as of the close of business on the HSNi record date are entitled to receive notice of, and to vote at, the HSNi special meeting. Please see "The HSNi Special Meeting—Voting Procedures for Record Holders" for instructions on how to vote your shares of HSNi common stock at the HSNi special meeting.

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    Each HSNi stockholder of record is entitled to one vote for each share of HSNi common stock held of record by him or her as of the close of business on the HSNi record date. As of the close of business on the HSNi record date, there were [     ·     ] shares of HSNi common stock issued and outstanding.

Q:
What am I being asked to vote on?

A:
At the HSNi special meeting, HSNi stockholders are being asked to consider and vote upon:

a proposal to approve the adoption of the merger agreement (the merger agreement proposal );

a proposal to authorize the adjournment of the HSNi special meeting by HSNi to permit further solicitation of proxies, if necessary or appropriate, if sufficient votes are not represented at the HSNi special meeting to approve the merger agreement proposal (the adjournment proposal ); and

a proposal to approve, by a non-binding advisory vote, certain compensation that may be paid or become payable to HSNi's named executive officers that is based on or otherwise relates to the merger (the non-binding compensation advisory proposal ).

    The approval of the merger agreement proposal is a condition to the completion of the merger. The approval of the adjournment proposal and the non-binding compensation advisory proposal are not conditions to the completion of the merger.

Q:
Why am I being asked to consider and vote on a proposal, by non-binding advisory vote, concerning compensation that may become payable to HSNi's named executive officers in connection with the merger?

A:
The SEC has adopted rules that require HSNi to seek a non-binding, advisory vote on the compensation payments that will or may be made to its named executive officers, that is based on or otherwise relates to the merger and that will or may become payable to its named executive officers at the closing of the merger or on a qualifying termination of employment upon or following the consummation of the merger. This compensation is referred to as "golden parachute" compensation by the applicable SEC disclosure rules. HSNi urges its stockholders to read the section entitled "Information About the Merger—Interests of Certain Persons of HSNi in the Merger."

Q.
What vote is required to approve each proposal?

A:
The merger agreement proposal requires the affirmative vote of the holders of a majority of the aggregate voting power of the outstanding shares of HSNi common stock and entitled to vote on such proposal, voting together as a single class. Each of the adjournment proposal and the non-binding compensation advisory proposal requires the affirmative vote of the holders of a majority of the votes cast affirmatively or negatively on such proposal (assuming a quorum is present).

Q:
How does the board of directors of HSNi recommend that I vote?

A:
The HSNi board recommends that you vote " FOR " the merger agreement proposal, " FOR " the adjournment proposal if necessary to solicit additional proxies in favor of the approval of the merger agreement proposal and " FOR " the non-binding compensation advisory proposal. Please see "Additional Information—Where You Can Find More Information." Your vote is important. Adoption of the merger agreement by the HSNi stockholders is a condition to the completion of the merger and requires the affirmative vote, in person or by proxy, of holders of a majority of the aggregate voting power of HSNi common stock outstanding and entitled to vote on such proposal,

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    voting together as a single class. Adoption of the other proposals to be considered at the special meeting requires the affirmative vote of holders of a majority of the votes cast affirmatively or negatively on such proposals.

    For more information regarding how the HSNi board recommends you vote, please see "Information About the Merger—HSNi's Purpose and Reasons for the Merger and Other Proposals; Recommendations of the Special Committee and HSNi Board; Fairness of the Merger."

Q:
Did the HSNi board form a special committee, and did the special committee receive opinions from its financial advisors?

The HSNi board formed a special committee to review and evaluate potential strategic transactions with Liberty Interactive and other potential third parties (the Special Committee ). The Special Committee was authorized by the HSNi board to (i) review, evaluate and negotiate the terms and conditions of a potential strategic transaction involving Liberty Interactive and, if the Special Committee deemed it appropriate, alternative transactions, including the possibility of a sale, merger or recapitalization of all or any portion of HSNi, (ii) negotiate with Liberty Interactive any element of any such potential transaction, (iii) negotiate with any other third party or parties the terms of any such alternative transaction, (iv) negotiate the terms of any definitive agreement with respect to any such transaction, the execution of which would be subject to the approval of the HSNi board, (v) determine and recommend to the HSNi board whether any such potential transaction was advisable and fair to and in the best interests of, HSNi and the HSNi stockholders and (vi) determine to elect not to pursue any such potential transaction. The HSNi board resolved not to approve any such transaction unless it was recommended by the Special Committee. Please see "Information About the Merger—Background of the Merger" and "Information About the Merger—HSNi's Purpose and Reasons for the Merger and Other Proposals; Recommendations of the Special Committee and HSNi Board; Fairness of the Merger."

The Special Committee engaged both Centerview Partners LLC ( Centerview Partners ) and Goldman Sachs & Co. LLC ( Goldman Sachs ) as financial advisors to the Special Committee.

In connection with this engagement, the Special Committee requested that Centerview Partners evaluate the fairness, from a financial point of view, to the holders of shares of HSNi common stock (other than shares held by HSNi as treasury stock and shares held by Liberty Interactive, its affiliates and other specified persons and entities related to a significant stockholder of Liberty Interactive, which are collectively referred to as Excluded Shares throughout this section and the summary of Centerview Partners' opinion in the section entitled "Information About the Merger—Opinion of the Special Committee Financial Advisor (Centerview Partners)") of the merger consideration. On July 5, 2017, Centerview Partners rendered to the Special Committee (with the members of the HSNi board other than Ms. Courtnee Chun and Mr. William Costello (the Qualified Directors ) present) its oral opinion, which was subsequently confirmed by delivery of a written opinion dated July 5, 2017, that, as of such date and based upon and subject to the assumptions made, procedures followed, matters considered, and qualifications and limitations upon the review undertaken by Centerview Partners in preparing its opinion, the merger consideration was fair, from a financial point of view, to the holders of shares of HSNi common stock (other than Excluded Shares).

The full text of Centerview Partners' written opinion, dated July 5, 2017, which describes the assumptions made, procedures followed, matters considered, and qualifications and limitations upon the review undertaken by Centerview Partners in preparing its opinion, is attached as Annex C to this proxy statement/prospectus and is incorporated herein by reference. Centerview Partners' financial advisory services and opinion were provided for the information and assistance of the Special Committee (in their capacity as directors and not in any other capacity) and at the

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    Special Committee's request, to the other members of the HSNi board (in their capacity as directors and not in any individual capacity as an employee or designee of any particular HSNi stockholder) in connection with and for purposes of their consideration of the merger and Centerview Partners' opinion addressed only the fairness, from a financial point of view, as of the date thereof, to the holders of shares of HSNi common stock (other than Excluded Shares) of the merger consideration. Centerview Partners' opinion did not address any other term or aspect of the merger agreement or the merger and does not constitute a recommendation to any HSNi stockholder or any other person as to how such stockholder or other person should vote with respect to the merger or otherwise act with respect to the merger or any other matter.

    The full text of Centerview Partners' written opinion should be read carefully in its entirety for a description of the assumptions made, procedures followed, matters considered, and qualifications and limitations upon the review undertaken by Centerview Partners in preparing its opinion. See "Information About the Merger Opinion of the Special Committee Financial Advisor (Centerview Partners)."

    In addition, Goldman Sachs delivered its opinion to the Special Committee (with the other Qualified Directors present) that, as of July 5, 2017, and based upon and subject to the factors and assumptions set forth therein, the consideration to be paid by Liberty Interactive for each share of HSNi common stock pursuant to the merger agreement was fair from a financial point of view to the HSNi stockholders (other than Liberty Interactive, a significant stockholder of Liberty Interactive, and their respective affiliates, which are collectively referred to as the Liberty Interactive related entities in and solely for the purpose of the summary of Goldman Sachs' opinion below in the section entitled "Information About the Merger—Opinion of the Special Committee Financial Advisor (Goldman Sachs)").

    The full text of the written opinion of Goldman Sachs, dated July 5, 2017, which sets forth assumptions made, procedures followed, matters considered and limitations on the review undertaken in connection with the opinion, is attached as Annex D to this proxy statement/prospectus and is incorporated herein by reference. Goldman Sachs provided its opinion for the information and assistance of the Special Committee and, at the Special Committee's request, for the information and assistance of the HSNi board in connection with their consideration of the merger. The Goldman Sachs opinion is not a recommendation as to how any HSNi stockholder should vote with respect to the merger or any other matter. See "Information About the Merger—Opinion of the Special Committee Financial Advisor (Goldman Sachs)."

Q:
What constitutes a quorum?

A:
The holders of a majority of the voting power of all of the shares of HSNi common stock entitled to vote at the HSNi special meeting, present in person or represented by proxy, shall constitute a quorum at the HSNi special meeting. For purposes of determining a quorum, your shares will be included as represented at the meeting even if your proxy indicates that you abstain from voting. If a broker who is a record holder of shares indicates on a form of proxy that the broker does not have discretionary authority to vote those shares, or if those shares are voted in circumstances in which proxy authority is defective or has been withheld, those shares will not be treated as present for purposes of determining the presence of a quorum.

Q:
What is the difference between holding shares as a stockholder of record and as a beneficial owner?

A:
If your shares of HSNi common stock are registered directly in your name with HSNi's transfer agent, Computershare Trust Company, N.A., you are considered the stockholder of record with respect to those shares, and access to proxy materials is being provided directly to you. If your

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    shares are held in a stock brokerage account or by a bank or other nominee, then you are considered the beneficial owner of those shares, which are considered to be held in "street name." Access to proxy materials is being provided to you by your broker, bank or other nominee who is considered the stockholder of record with respect to those shares.

Q:
How can I vote my shares in person at the HSNi special meeting?

A:
Shares of HSNi common stock held directly in your name as the stockholder of record as of the close of business on the HSNi record date may be voted in person at the HSNi special meeting. If you choose to attend the HSNi special meeting, you will need to bring valid, government-issued photo identification. If you are a beneficial owner of HSNi common stock but not the stockholder of record of such shares, you will also need proof of stock ownership to be admitted to the HSNi special meeting. A recent brokerage statement or a letter from a bank or broker are examples of proof of ownership. Please note that if your shares are held in "street name" by a broker, bank or other nominee and you wish to vote at the HSNi special meeting, you will not be permitted to vote in person unless you first obtain a legal proxy issued in your name from the record owner and present it to the inspector of election with your ballot at the HSNi special meeting. To request a legal proxy, please contact your broker, bank or other nominee holder of record. It is suggested you do so in a timely manner to ensure receipt of your legal proxy prior to the HSNi special meeting.

Failure to bring the appropriate documentation may delay your entry into or prevent you from attending the HSNi special meeting. The doors to the meeting room will be closed promptly at the start of the meeting, and HSNi stockholders will not be permitted to enter after that time.

Q:
How can I vote my shares without attending the special meeting?

A:
If you are a stockholder of record of HSNi common stock as of the close of business on the HSNi record date, you can vote by proxy via the internet, by telephone or by mail by following the instructions provided in the enclosed proxy card. Please note that if you are a beneficial owner, you may vote by submitting voting instructions to your bank, brokerage firm or other nominee, or otherwise by following instructions provided by your bank, brokerage firm or other nominee. Telephone and internet voting may be available to beneficial owner. Please refer to the vote instruction form provided by your bank, brokerage firm or other nominee.

Q:
Can I change my vote after I have returned a proxy or voting instruction card or voted through the Internet or by telephone?

A:
Yes. If you are a stockholder of record of HSNi common stock as of the close of business on the HSNi record date, whether you vote by telephone, internet or mail, you can change or revoke your proxy before it is voted at the HSNi special meeting by:

submitting a new proxy card bearing a later date;

voting again by telephone or the internet at a later time;

giving written notice of your revocation to the HSNi Corporate Secretary at the address provided above; or

voting in person at the HSNi special meeting. Please note that your attendance at the HSNi special meeting will not alone serve to revoke your proxy.

    If you are a beneficial owner of HSNi common stock as of the close of business on the HSNi record date, you must follow the instructions of your broker, bank or other nominee to revoke or change your voting instructions.

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Q:
If my shares of HSNi common stock are held in "street name" by my bank, brokerage firm or other nominee, will my bank, brokerage firm or other nominee automatically vote my shares for me?

A:
If you hold your shares of HSNi common stock in a stock brokerage account or if your shares are held by a bank, brokerage firm or other nominee (that is, in "street name"), you must provide the record holder of your shares with instructions on how to vote your shares. Banks, brokerage firms or other nominees who hold shares of HSNi common stock on behalf of their customers may not give a proxy to HSNi to vote those shares without specific instructions from their customers. Please follow the voting instructions provided by your bank, brokerage firm or other nominee. Please note that you may not vote shares of HSNi common stock held in street name by returning a proxy card directly to HSNi or by voting in person at the HSNi special meeting unless you provide a "legal proxy," which you must obtain from your bank, brokerage firm or other nominee.

If you fail to instruct your bank, brokerage firm or other nominee to vote your shares of HSNi common stock, your bank, brokerage firm or other nominee may not vote your shares on the merger agreement proposal, the adjournment proposal or the non-binding compensation advisory proposal. This will have the same effect as a vote against the merger agreement proposal, but it will have no effect on the adjournment proposal or the non-binding compensation advisory proposal, assuming a quorum is present.

Q:
What will happen if I fail to vote or I abstain from voting?

A:
If you are an HSNi stockholder and fail to vote, it will have the same effect as a vote against the merger agreement proposal, but, assuming a quorum is present, it will have no effect on the adjournment proposal or the non-binding compensation advisory proposal. If you are an HSNi stockholder and you abstain from voting, it will have the same effect as a vote against the merger agreement proposal, but it will have no effect on the adjournment proposal and the non-binding compensation advisory proposal.

Q:
If an HSNi stockholder gives a proxy, how will the shares of HSNi common stock covered by the proxy be voted?

A:
If you provide a proxy, regardless of whether you provide that proxy by phone, via the internet or by completing and returning the applicable enclosed proxy card, the individuals named on the enclosed proxy card will vote your shares of HSNi common stock in the way that you indicate when providing your proxy in respect of the shares of HSNi common stock. When completing the internet or telephone processes or the proxy card, you may specify whether your shares of HSNi common stock should be voted for or against, or abstain from voting on, all, some or none of the specific items of business to come before the HSNi special meeting.

Q:
How will my shares of HSNi common stock be voted if I return a blank proxy?

A:
If you sign, date and return your proxy and do not indicate how you want your shares of HSNi common stock to be voted, then your shares of HSNi common stock will be voted " FOR " the merger agreement proposal, " FOR " the adjournment proposal if necessary to solicit additional proxies in favor of the approval of the merger agreement and " FOR " the non-binding compensation advisory proposal.

Q:
What should I do if I receive more than one set of voting materials?

A:
You may receive more than one set of voting materials relating to the HSNi special meeting if you hold shares of HSNi stock in "street name" and also directly in your name as a stockholder of record or otherwise or if you hold shares of HSNi common stock in more than one brokerage

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    account. If you do receive more than one set of voting materials, you should follow the appropriate procedures in each set of voting materials to ensure that you vote all of your shares.

    Direct holders (stockholders of record)

    For shares of HSNi common stock held directly, please complete, sign, date and return each proxy card (or cast your vote by telephone or internet as provided on each proxy card) or otherwise follow the voting instructions provided in this proxy statement/prospectus in order to ensure that all of your shares of HSNi common stock are voted.

    Holders of shares in "street name"

    For shares of HSNi common stock held in "street name" through a bank, brokerage firm or other nominee, you should follow the procedures provided by your bank, brokerage firm or other nominee to vote your shares.

Q:
What happens if I sell my shares of HSNi common stock before the HSNi special meeting?

A:
The HSNi record date for HSNi stockholders entitled to vote at the HSNi special meeting is earlier than the date of the HSNi special meeting. If you transfer your shares of HSNi common stock after the HSNi record date but before the HSNi special meeting, you will, unless special arrangements are made, retain your right to vote at the HSNi special meeting but will have transferred the right to receive the merger consideration in connection with the merger to the person to whom you transferred your shares of HSNi common stock.

Q:
Are HSNi stockholders entitled to appraisal rights in connection with the merger?

A:
No. Under Delaware law, HSNi stockholders are not entitled to appraisal rights in connection with the merger. For more information regarding appraisal rights, see "Information About the Merger—No Appraisal Rights."

Q:
Has Liberty Interactive agreed to vote its shares in favor of any of the proposals to be considered at the HSNi special meeting?

A:
Yes. Pursuant to the merger agreement, Liberty Interactive agreed to vote the shares of HSNi common stock it beneficially owns in favor of the adoption of the merger agreement, in favor of any proposal to adjourn or postpose the HSNi special meeting if there are not sufficient votes to adopt the merger agreement and/or if there are not sufficient shares present in person or by proxy at such meeting to constitute a quorum, and in favor of any other matter necessary to consummate the merger.

As of the HSNi record date, Liberty Interactive beneficially owned approximately [     ·     ]% of the outstanding shares of HSNi common stock.

For a discussion of Liberty Interactive's obligations to vote the shares of HSNi common stock it beneficially owns in favor of the merger, see "Information About the Merger—The Merger Agreement—Liberty Interactive Voting Obligations."

Q:
What do I need to do now?

A:
Carefully read and consider the information contained in and incorporated by reference into this proxy statement/prospectus, including its annexes, and return your completed, signed and dated proxy card(s) by mail in the enclosed postage-paid envelope or submit your voting instructions by telephone or via the internet as soon as possible so that your shares of HSNi common stock will be voted in accordance with your instructions.

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    You should not submit your HSNi share certificates at this time .    After the merger is completed, if you held certificates representing shares of HSNi common stock immediately prior to the effective time, the exchange agent will send you a letter of transmittal and instructions for exchanging your shares of HSNi common stock for the merger consideration. Upon surrender of the certificates for cancellation and the executed letter of transmittal and other required documents described in the instructions, an HSNi stockholder will receive the merger consideration.

    Holders of shares of HSNi common stock in book-entry form immediately prior to the effective time will not need to take any action to receive the merger consideration.

Q:
Who is the exchange agent for the merger?

A:
Liberty Interactive has selected Computershare Trust Company, N.A. to act as the exchange agent in connection with the merger.

Q:
Who will solicit and pay the cost of soliciting proxies?

A:
HSNi has retained Georgeson LLC ( Georgeson ) to assist in the solicitation process. HSNi will pay Georgeson a fee of approximately $5,000, as well as reasonable and documented out-of-pocket expenses. HSNi also has agreed to indemnify Georgeson against various liabilities and expenses that relate to or arise out of its solicitation of proxies (subject to certain exceptions).

Q:
Will HSNi stockholders receive certificates representing shares of Liberty QVCA common stock following the merger?

A:
No. Pursuant to the terms of the merger agreement, no physical certificates representing shares of Liberty QVCA common stock will be delivered to HSNi stockholders. Instead, Liberty Interactive, with the assistance of the exchange agent, will electronically distribute shares of Liberty QVCA common stock in book-entry form to such holder or its bank or brokerage firm on its behalf. If you are a record holder of HSNi common stock upon the effective time, the exchange agent will mail you a book-entry account statement that reflects your shares of Liberty QVCA common stock. If you are a beneficial owner (but not a record holder) of HSNi common stock upon the effective time, your bank or brokerage firm will credit your account with the shares of Liberty QVCA common stock that you are entitled to receive.

Q:
Who can help answer my questions?

A:
HSNi stockholders who have questions about the merger or the matters to be voted on at the HSNi special meeting, or who desire additional copies of this proxy statement/prospectus or additional proxy or voting instruction cards should contact:

Georgeson LLC
1290 Avenue of the Americas, 9 th  Floor
New York, NY 10104
(888) 206-5896

or

HSN, Inc.
1 HSN Drive
St. Petersburg, FL 33729
Attn.: Investor Relations
(727) 872-1000
ir@hsn.net

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SUMMARY

         The following summary includes selected information contained elsewhere in this proxy statement/prospectus. This summary does not contain all of the important information that you should consider before voting on the proposals. You should carefully read the entire proxy statement/prospectus, including the Annexes and the documents incorporated by reference herein.

The Companies

    Liberty Interactive Corporation

        Liberty Interactive is a Delaware corporation and owns interests in companies primarily engaged in the video and online commerce industries. Through its subsidiaries and affiliates, it operates in North America, Europe and Asia. Its principal businesses and assets include its consolidated subsidiaries QVC, Inc. ( QVC ), zulily, llc ( zulily ) and Evite, Inc. ( Evite ) and its equity interests in FTD Companies, Inc. ( FTD ), HSNi, LendingTree, Inc. ( LendingTree ), Charter Communications, Inc. ( Charter ) and Liberty Broadband Corporation ( Liberty Broadband ).

        Liberty Interactive's corporate structure includes two tracking stocks, each of which tracks a tracking stock group. Tracking stocks are a type of capital stock that the issuing company intends to reflect or "track" the economic performance of a particular business or "group," rather than the economic performance of the company as a whole. Each group has a separate collection of businesses, assets and liabilities attributed to it, but no group is a separate legal entity and, therefore, no group can own assets, issue securities or enter into legally binding agreements. Liberty Interactive's two tracking stocks are the QVC Group common stock (which includes the Liberty QVCA common stock and Liberty's Series B QVC Group common stock, par value $0.01 per share ( QVCB )) and the Liberty Ventures common stock, which are intended to track and reflect the economic performance of the QVC Group and the Ventures Group, respectively. The QVC Group common stock trades on Nasdaq under the ticker symbols "QVCA" and "QVCB," and the Liberty Ventures common stock trades on Nasdaq under the ticker symbols "LVNTA" and "LVNTB."

        Currently, the QVC Group has attributed to it, among other things, Liberty Interactive's wholly-owned subsidiaries QVC and zulily and its approximately 38% interest in HSNi, along with cash and certain liabilities. The Ventures Group has attributed to it, among other things, Liberty Interactive's equity interests in FTD, LendingTree, Charter and Liberty Broadband, and certain liabilities relating to exchangeable debentures of Liberty LLC, along with cash and certain other liabilities.

        On April 4, 2017, Liberty Interactive, Liberty LLC and GCI entered into the GCI reorganization agreement whereby Liberty Interactive has agreed, on the terms and subject to the conditions set forth therein, to acquire GCI through a reorganization in which certain Ventures Group assets and liabilities will be contributed to GCI in exchange for a controlling interest in GCI. Liberty Interactive would then effect a tax-free split-off of its controlling interest in the combined company (to be named GCI Liberty, Inc.) to the holders of Liberty Ventures common stock in full redemption of all outstanding shares of Liberty Ventures common stock. The GCI transactions currently are expected to be consummated during the fourth quarter of 2017, subject to the satisfaction or waiver, if applicable, of the closing conditions set forth in the GCI reorganization agreement. The completion of the merger is not a condition to the completion of the GCI transactions, nor is the completion of the GCI transactions a condition to the completion of the merger.

        In connection with the GCI transactions, it is currently contemplated that the following assets and liabilities currently attributed to the Ventures Group will be reattributed to the QVC Group:

    certain green energy assets attributed to the Ventures Group;

    Liberty LLC's outstanding 4% Exchangeable Senior Debentures due 2029;

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    Liberty LLC's outstanding 3.75% Exchangeable Senior Debentures due 2030;

    Liberty LLC's outstanding 3.5% Exchangeable Senior Debentures due 2031;

    Liberty LLC's outstanding 0.75% Exchangeable Senior Debentures due 2043;

    any portion of Liberty LLC's outstanding 1.75% Exchangeable Senior Debentures due 2046 not tendered in the exchange offer for mirror debentures of GCI Liberty, Inc. that is expected to be completed in connection with the closing of the GCI transaction;

    a certain amount of cash;

    deferred tax liabilities and tax attributes relating to the exchangeable senior debentures described above and certain tax items related to Liberty Interactive's repurchase of exchangeable debentures in prior years;

    tax benefits relating to certain equity awards with respect to stock of Liberty Expedia Holdings, Inc. ( Liberty Expedia ), CommerceHub, Inc. and Liberty TripAdvisor Holdings, Inc. ( Liberty TripAdvisor );

    Liberty Interactive's interest in ILG, Inc. ( ILG );

    Liberty Interactive's interest in Time, Inc.; and

    Liberty Interactive's interest in Time Warner, Inc.

No assurance can be given, however, that the GCI transactions will be completed on the terms described above or at all.

        The address of Liberty Interactive's principal executive office is 12300 Liberty Boulevard, Englewood, Colorado 80112, and its telephone number is (720) 875-5300.

        The transfer agent and registrar for the QVC Group common stock and the Liberty Ventures common stock is Computershare Trust Company, N.A.

    Liberty Horizon, Inc.

        Merger Sub is a Delaware corporation and a direct, wholly owned subsidiary of Liberty Interactive. Merger Sub was formed by Liberty Interactive for the purpose of engaging in the transactions contemplated by the merger agreement, and has not conducted any business activities, has no assets, liabilities or obligations and has conducted its operations solely as contemplated by the merger agreement.

        The address of Merger Sub's principal executive office is c/o Liberty Interactive Corporation, 12300 Liberty Boulevard, Englewood, Colorado 80112, and its telephone number is (720) 875-5300.

    HSN, Inc.

        HSNi is an interactive multi-channel retailer offering customers innovative and differentiated experiences through various platforms including television, online, mobile, catalogs and in retail and outlet stores through the six brands of its two operating segments, HSN and Cornerstone.

        HSN is an interactive entertainment and lifestyle retailer offering a curated assortment of exclusive products and top brand names to its customers primarily through television home shopping programming on the HSN television networks, through its business-to-consumer digital commerce sites HSN.com and joymangano.com, through mobile applications, through its outlet stores and through its wholesale distribution of certain proprietary products to other retailers. HSN incorporates entertainment, inspiration and personalities to provide an entirely unique shopping experience.

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        Cornerstone is comprised of interactive, aspirational home and apparel lifestyle brands, including Ballard Designs, Frontgate, Garnet Hill, Grandin Road, and Improvements. Cornerstone operates five separate digital sales sites, distributes approximately 300 million catalogs annually and operates 18 retail and outlet stores.

        HSNi's predecessor company began broadcasting television home shopping programming from its studios in St. Petersburg, Florida in 1981 and, by 1985, was broadcasting this programming through a national network of cable and local television stations 24 hours a day, seven days a week. HSNi's national distribution network consists of a combination of cable, satellite and broadcast systems and, as of December 31, 2016, the HSNi television networks reached approximately 91.1 million residential homes in the United States.

        HSNi was incorporated in Delaware in May 2008 in connection with the spin-off of several businesses previously owned by IAC/InterActiveCorp ( IAC ). HSNi was formed to hold HSNi and Cornerstone, the businesses that previously comprised most of IAC's retailing segment. The spin-off from IAC occurred on August 20, 2008 and, in connection with such spin-off, HSNi's shares began trading on the Nasdaq under the symbol "HSNI."

        The address of HSNi's principal executive office is 1 HSN Drive, St. Petersburg, Florida 33729 and its main telephone number is (727) 872-1000.

The Merger

        Please refer to the information included in "Questions and Answers" above for a summary of the terms and conditions of the merger agreement. A more complete description of the terms and conditions of the merger agreement is included in "Information About the Merger—The Merger Agreement."

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SELECTED FINANCIAL DATA OF LIBERTY INTERACTIVE AND HSNi

Selected Historical Financial Data of Liberty Interactive

        The following tables present selected historical information related to Liberty Interactive's financial condition and results of operations as of and for each of the years in the five year period ended December 31, 2016 and as of and for the six months ended June 30, 2017 and 2016. The following data should be read in conjunction with Liberty Interactive's consolidated financial statements.

 
   
  December 31,  
 
  June 30,
2017
 
 
  2016   2015   2014   2013   2012  
 
  amounts in millions
 

Summary Balance Sheet Data:

                                     

Cash and cash equivalents

  $ 905     825     2,449     2,306     902     2,291  

Investments in available-for-sale securities and other cost investments

  $ 2,347     1,922     1,353     1,224     1,313     1,720  

Investment in affiliates, accounted for using the equity method

  $ 646     581     714     1,119     760     420  

Investment in Liberty Broadband measured at fair value

  $ 3,703     3,161                  

Intangible assets not subject to amortization

  $ 9,405     9,354     9,485     7,893     8,383     8,424  

Noncurrent assets of discontinued operations(1)(2)

  $         927     514     7,572     7,859  

Total assets

  $ 20,973     20,355     21,180     18,598     24,642     26,223  

Long-term debt

  $ 6,935     7,166     7,481     7,062     6,072     5,873  

Deferred income tax liabilities

  $ 3,920     3,636     3,217     2,681     2,794     2,805  

Noncurrent liabilities of discontinued operations(1)(2)

  $         285     140     1,584     1,878  

Total equity

  $ 7,499     6,861     6,875     5,780     11,435     12,051  

Noncontrolling interest in equity of subsidiaries(1)

  $ 93     89     88     107     4,499     4,489  

 

 
  Six months
ended
June 30,
  Years ended December 31,  
 
  2017   2016   2016   2015   2014   2013   2012  
 
  amounts in millions,
except per share amounts

 

Summary Statement of Operations Data:

                                           

Revenue

  $ 4,679     5,073     10,647     9,989     10,499     10,219     9,888  

Operating income (loss)

  $ 467     439     968     1,116     1,188     1,136     1,163  

Interest expense

  $ (179 )   (185 )   (363 )   (360 )   (387 )   (380 )   (466 )

Share of earnings (losses) of affiliates, net

  $ (36 )   1     (68 )   (178 )   (19 )   2     (20 )

Realized and unrealized gains (losses) on financial instruments, net

  $ 817     336     1,175     114     (57 )   (22 )   (81 )

Gains (losses) on transactions, net

  $         9     110     74     (1 )    

Earnings (loss) from continuing operations(3):

                                           

Liberty Interactive Corporation common stock

    NA     NA     NA     NA     NA     NA     33  

QVC Group common stock

  $ 202     224     511     674     574     500     291  

Liberty Ventures common stock

    480     223     743     (43 )   (36 )   27     125  

  $ 682     447     1,254     631     538     527     449  

Basic earnings (loss) from continuing operations attributable to Liberty Interactive Corporation stockholders per common share(4):

                                           

Series A and Series B Liberty Interactive Corporation common stock

    NA     NA     NA     NA     NA     NA      

Series A and Series B QVC Group common stock

  $ 0.45     0.46     0.99     1.35     1.10     0.88     0.48  

Series A and Series B Liberty Ventures common stock

  $ 5.65     1.66     5.54     (0.36 )   (0.43 )   0.37     1.89  

Diluted earnings (loss) from continuing operations attributable to Liberty Interactive Corporation stockholders per common share(4):

                                           

Series A and Series B Liberty Interactive Corporation common stock

  $ NA     NA     NA     NA     NA     NA      

Series A and Series B QVC Group common stock

  $ 0.44     0.46     0.98     1.33     1.09     0.86     0.47  

Series A and Series B Liberty Ventures common stock(2)

  $ 5.58     1.65     5.49     (0.36 )   (0.43 )   0.36     1.87  

(1)
On December 11, 2012, Liberty Interactive acquired approximately 4.8 million additional shares of common stock of TripAdvisor, Inc. ( TripAdvisor ) (an additional 4% equity ownership interest), for $300 million, along with the right to control the vote of the shares of TripAdvisor's common stock and class B common stock Liberty Interactive owns. Following the transaction Liberty Interactive owned approximately 22% of the equity and 57% of the total votes of all classes of TripAdvisor common stock. On August 27, 2014, Liberty Interactive completed the spin-off of its

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    former wholly owned subsidiary, Liberty TripAdvisor (the Liberty TripAdvisor spin-off ), to holder of shares of its Liberty Ventures common stock. At the time of the Liberty TripAdvisor spin-off, Liberty TripAdvisor was comprised of Liberty Interactive's former interest in TripAdvisor as well as BuySeasons, Inc., Liberty Interactive's former wholly-owned subsidiary, and corporate level debt. Following the completion of the Liberty TripAdvisor spin-off, Liberty Interactive and Liberty TripAdvisor operate as separate, publicly traded companies, and neither has any stock ownership, beneficial or otherwise, in the other. The consolidated financial statements of Liberty Interactive have been prepared to reflect Liberty TripAdvisor as discontinued operations. However, the noncontrolling interest attributable to its former ownership interest in TripAdvisor is included in the noncontrolling interest line item in the consolidated balance sheet from the date of acquisition until the date of completion of the Liberty TripAdvisor spin-off.

(2)
The split-off of Liberty Expedia was effected on November 4, 2016 through the redemption of a portion of LVNTA and LVNTB for shares of the corresponding series of common stock of Liberty Expedia. The consolidated financial statements of Liberty Interactive have been prepared to reflect Liberty Interactive's interest in Expedia, Inc. as a discontinued operation.

(3)
Includes earnings (losses) from continuing operations attributable to the noncontrolling interests of $39 million, $42 million, $40 million, $45 million and $63 million for the years ended December 31, 2016, 2015, 2014, 2013 and 2012, respectively.

(4)
Basic and diluted earnings per share have been calculated for Liberty Interactive Corporation common stock for the periods from May 9, 2006 to August 9, 2012. Basic and diluted earnings per share have been calculated for QVC Group common stock and Liberty Ventures common stock subsequent to August 9, 2012.

Selected Historical Financial Data of HSNi

        The following table presents selected historical consolidated financial data for HSNi as of and for the years ended December 31, 2016, 2015, 2014, 2013 and 2012 and as of and for the six months ended June 30, 2017 and 2016. The consolidated financial data for each of the years ended December 31, 2016, 2015 and 2014, and as of December 31, 2016 and 2015 have been derived from HSNi's selected financial data and audited consolidated financial statements included in its Annual Report on Form 10-K for the fiscal year ended December 31, 2016, which is incorporated by reference herein. The selected historical consolidated financial data of HSNi for each of the years ended December 31, 2013 and 2012 and as of December 31, 2014, 2013 and 2012 have been derived from HSNi's selected financial data and audited consolidated financial statements for such years, which have not been incorporated by reference herein. The selected historical consolidated financial data as of, and for the six months ended, June 30, 2017 and for the six months ended June 30, 2016 have been derived from HSNi's unaudited consolidated financial statements and related notes contained in its Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2017, which is incorporated by reference herein.

        The information set forth below is not necessarily indicative of future results and should be read together with the other information contained in HSNi's Annual Report on Form 10-K for the fiscal year ended December 31, 2016 and its Quarterly Reports on Form 10-Q for the quarters ended March 31, 2017 and June 30, 2017, including the sections entitled "Management's Discussion and

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Analysis of Financial Condition and Results of Operations" and the consolidated financial statements and related notes therein. See "Additional Information—Where You Can Find More Information."

 
   
  December 31,  
 
  June 30,
2017
 
 
  2016   2015   2014   2013   2012  
 
  amounts in thousands
 

Summary Balance Sheet Data:

                                     

Working capital

  $ 260,579     268,937     329,182     407,654     361,386     357,265  

Total assets

  $ 1,206,844     1,304,533     1,341,463     1,399,526     1,308,162     1,304,349  

Total debt, including current maturities

  $ 487,500     515,000     640,000     228,126     240,625     250,000  

Other long-term liabilities, including deferred income taxes

  $ 84,547     80,088     65,155     72,698     74,845     67,385  

 

 
  Six months ended
June 30,
  Years ended December 31,  
 
  2017   2016   2016   2015   2014   2013   2012(1)  
 
  amounts in thousands,
except per share amounts

 

Statement of Operations Data:

                                           

Net sales

  $ 1,606,796     1,671,074     3,567,485     3,690,575     3,587,995     3,403,983     3,266,739  

Loss on sale of businesses and asset impairments(2)

  $     20,400     31,232     6,660         3,040      

Operating income (loss)

  $ 94,161     96,043     205,807     284,034     284,609     282,654     258,744  

Income from continuing operations

  $ 54,021     55,030     118,708     169,239     172,984     178,449     136,497  

Net income

  $ 54,021     55,030     118,708     169,239     172,984     178,449     130,675  

Income from continuing operations per share:

                                           

Basic earnings per share:

  $ 1.03     1.05     2.27     3.22     3.28     3.33     2.42  

Diluted earnings (loss) per share:

  $ 1.02     1.04     2.25     3.16     3.23     3.25     2.36  

Net income per share:

                                           

Basic earnings per share:

  $ 1.03     1.05     2.27     3.22     3.28     3.33     2.32  

Diluted earnings (loss) per share:

  $ 1.02     1.04     2.25     3.16     3.23     3.25     2.25  

(1)
The Territory Ahead and Smith+Noble, two brands sold by Cornerstone in 2012, were presented as discontinued operations.

(2)
Includes the loss on sale of businesses and asset impairment charges related to Chasing Fireflies and TravelSmith, two brands sold by Cornerstone in 2016.

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UNAUDITED COMPARATIVE PER SHARE INFORMATION

        Presented below are the QVC Group's and HSNi's historical and pro forma per share data for the year ended December 31, 2016 and six months ended June 30, 2017. Except for the historical information for the year ended December 31, 2016, the information provided in the table below is unaudited. This information should be read together with the historical consolidated financial statements and related notes of the QVC Group and HSNi filed by each with the SEC, and incorporated by reference in this proxy statement/prospectus, and with the unaudited pro forma condensed combined financial statements included in the section entitled "Unaudited Pro Forma Condensed Combined Financial Statements."

        The pro forma information is presented for illustrative purposes only and is not necessarily indicative of the operating results or financial position that would have occurred if the merger had been completed as of the beginning of the periods presented, nor is it necessarily indicative of the future operating results or financial position of the combined company. The pro forma information, although helpful in illustrating the financial characteristics of the combined company under one set of assumptions, does not reflect the benefits of expected cost savings, opportunities to earn additional revenue, the impact of restructuring, or other factors that may result as a consequence of the merger and, accordingly, does not attempt to predict or suggest future results.

QVC Group Common Stock Historical Per Share Data

        This table shows historical per share information for QVC Group common stock.

 
  As of and for the
six months ended
June 30, 2017
  As of and for the
year ended
December 31, 2016
 

Basic earnings per share attributable to the QVC Group

  $ 0.45   $ 0.99  

Diluted earnings per share attributable to the QVC Group

    0.44     0.98  

Cash dividends per share

         

Book value per share

    11.10     10.61  

HSNi Common Stock Historical Per Share Data

 
  As of and for the
six months ended
June 30, 2017
  As of and for the
year ended
December 31, 2016
 

Basic earnings per share

  $ 1.03   $ 2.27  

Diluted earnings per share

    1.02     2.25  

Cash dividends per share

    0.70     1.40  

Book value per share

    4.10     3.74  

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QVC Group Pro Forma Per Share Data

        This table shows pro forma per share information for QVC Group common stock after giving effect to the HSNi business combination.

 
  As of and for the
six months ended
June 30, 2017
  As of and for the
year ended
December 31, 2016
 

Pro forma basic earnings per share attributable to QVC Group common stockholders

  $ 0.39   $ 0.87  

Cash dividends per share

         

Pro forma book value per share

    14.07     NA  

        The above pro forma earnings per share data was calculated by dividing net earnings (loss) attributable to QVC Group stockholders per the pro forma condensed combined statements of operations by 505 million common shares, which is the aggregate number of shares of Liberty QVCA common stock and Series B QVC Group common stock outstanding if the business combination had occurred on June 30, 2017. The pro forma book value per share information was calculated by dividing QVC Group net assets plus pro forma adjustments to total equity per the pro forma condensed combined balance sheet by 505 million common shares outstanding.

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COMPARATIVE PER SHARE MARKET PRICE AND DIVIDEND INFORMATION

Liberty Interactive Market Price

        On October 3, 2014, Liberty Interactive reattributed from the Interactive Group to the Ventures Group approximately $1 billion in cash and its digital commerce businesses, including Backcountry.com, Inc., Bodybuilding.com, LLC, CommerceHub, Inc. (then, Commerce Technologies, Inc.) ( CommerceHub ), Provide Commerce, Inc. and Evite. Subsequent to such reattribution, the Interactive Group is now referred to as the QVC Group. In connection with the reattribution, the Liberty Interactive tracking stock trading symbol "LINTA" was changed to "QVCA" and the "LINTB" tracking stock trading symbol was changed to "QVCB," effective October 7, 2014. Effective June 4, 2015, the name of the "Liberty Interactive common stock" was changed to the "QVC Group common stock." In connection with the split-off of Liberty Expedia, Liberty Interactive redeemed 0.4 of each outstanding share of LVNTA and LVNTB for 0.4 of a share of Liberty Expedia Series A and Series B common stock, respectively, at 5:00 p.m., New York City time, on November 4, 2016. Accordingly, the high and low sales prices of the Series A and Series B Liberty Ventures common stock have been retroactively restated in the table below. Each series of Liberty Interactive's common stock trades on Nasdaq. The following table sets forth the range of intra-day high and low sales prices of shares of Liberty Interactive's common stock for the periods indicated.

 
  QVC Group  
 
  Series A (QVCA)   Series B (QVCB)  
 
  High   Low   High   Low  

2015

                         

First quarter

  $ 29.73     27.03     30.10     27.45  

Second quarter

  $ 29.70     27.01     30.06     27.91  

Third quarter

  $ 31.62     24.72     30.75     25.80  

Fourth quarter

  $ 28.71     25.01     28.26     26.02  

2016

                         

First quarter

  $ 26.97     22.51     30.62     24.40  

Second quarter

  $ 27.25     23.01     26.98     24.02  

Third quarter

  $ 27.06     18.42     26.69     19.00  

Fourth quarter

  $ 22.33     17.88     24.10     17.78  

2017

                         

First quarter

  $ 20.88     17.24     22.05     17.62  

Second quarter

  $ 24.94     19.81     24.93     19.40  

Third quarter (through August 28, 2017)

  $ 26.00     20.90     25.10     21.14  

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  Liberty Ventures  
 
  Series A (LVNTA)   Series B (LVNTB)  
 
  High   Low   High   Low  

2015

                         

First quarter

  $ 38.31     31.64     37.88     33.60  

Second quarter

  $ 41.06     35.13     40.62     34.42  

Third quarter

  $ 39.57     32.08     40.70     35.46  

Fourth quarter

  $ 41.03     35.96     42.24     39.08  

2016

                         

First quarter

  $ 40.22     29.24     36.83     33.14  

Second quarter

  $ 36.55     30.97     36.72     34.36  

Third quarter (July 1 - July 22)

  $ 38.59     32.76     37.87     37.33  

Third quarter (July 23 - September 30)(1)

  $ 40.80     36.09     39.89     38.05  

Fourth quarter (October 1 - November 4)

  $ 41.37     38.40     41.57     39.29  

Fourth quarter (November 5 - December 31)(2)

  $ 41.74     36.54     41.94     36.93  

2017

                         

First quarter

  $ 45.17     36.69     46.61     38.61  

Second quarter

  $ 55.93     44.13     56.33     53.33  

Third quarter (through August 28, 2017)

  $ 62.41     50.56     59.88     51.80  

(1)
Liberty Interactive effected the spin-off of CommerceHub on July 22, 2016 as a pro-rata dividend of shares of CommerceHub to the holders of Liberty Ventures common stock.

(2)
Liberty Interactive effected the split-off of Liberty Expedia on November 4, 2016 as a redemption of the Liberty Ventures common stock for shares of Liberty Expedia.

        As of July 5, 2017, the last trading day prior to the public announcement of the merger, Liberty QVCA common stock closed at $24.46. As of August 28, 2017, the most recent practicable date prior to the filing of this proxy statement/prospectus, Liberty QVCA common stock closed at $22.15.

HSNi Market Price

        Shares of HSNi common stock are traded on Nasdaq under the symbol "HSNI." The following table sets forth the range of intra-day high and low sales prices per share for HSNi common stock for the periods indicated and the cash dividends per share declared with respect to HSNi common stock in

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the periods indicated, in each case rounded to the nearest whole cent. HSNi's fiscal year ends on December 31.

 
  HSNi Common Stock  
 
  High   Low   Dividend  

2015

                   

First quarter(1)

  $ 79.80     64.13     10.35  

Second quarter

  $ 71.46     61.74     0.35  

Third quarter

  $ 75.43     57.17     0.35  

Fourth quarter

  $ 63.44     49.43     0.35  

2016

                   

First quarter

  $ 55.87     40.83     0.35  

Second quarter

  $ 54.79     45.57     0.35  

Third quarter

  $ 54.03     37.34     0.35  

Fourth quarter

  $ 40.95     30.75     0.35  

2017

                   

First quarter

  $ 41.35     32.70     0.35  

Second quarter

  $ 38.35     30.90     0.35  

Third quarter (through August 28, 2017)

  $ 42.75     31.25     0.35  

(1)
In January 2015, the HSNi board approved a special cash dividend of $10.00 per share payable February 19, 2015 to stockholders of record as of February 9, 2015. The intra-day high and low sales prices per share for HSNi common stock have not been adjusted for such special cash dividend.

        As of July 5, 2017, the last trading day prior to the public announcement of the merger, shares of HSNi common stock closed at $31.30. As of August 28, 2017, the most recent practicable date prior to the filing of this proxy statement/prospectus, shares of HSNi common stock closed at $36.50. You should obtain current market quotations for shares of HSNi common stock, as the market price of HSNi common stock will fluctuate between the date of this proxy statement/prospectus and the date on which the merger is completed, and at times in between. You can obtain these quotations from publicly available sources.

Dividends

        Liberty Interactive has not paid any cash dividends on shares of QVC Group common stock. In addition, until the completion of the merger, Liberty Interactive has agreed not to declare or pay any cash dividend or make any other cash distribution with respect to shares of QVC Group common stock.

        In the first quarter of 2017, the HSNi board approved a quarterly cash dividend of $0.35 per share of HSNi common stock resulting in a payment of $18.3 million on March 22, 2017. In the second quarter of 2017, the HSNi board approved a quarterly cash dividend of $0.35 per share of HSNi common stock resulting in a payment of $18.3 million on June 21, 2017. In the third quarter of 2017, the HSNi board approved a quarterly cash dividend of $0.35 per share of HSNi common stock to be paid on September 22, 2017. Under the terms of the merger agreement, HSNi may continue to pay regular dividends on a quarterly basis not to exceed $0.35 per share of HSNi common stock, provided that such dividend may not be paid using funds borrowed specifically for that purpose.

        The declaration of dividends is at the discretion of the HSNi board. The HSNi board periodically reviews the HSNi dividend policy based upon HSNi's financial results and cash flow projections. Decisions regarding whether or not to pay dividends and the amount of any dividends are determined after consideration of various factors, including earnings, cash requirements, the financial condition of

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HSNi, the DGCL, limitations under the merger agreement and other factors deemed relevant by the HSNi board.

Comparison of Liberty QVCA Common Stock and HSNi Market Prices and Implied Value of Share Value of the Stock Consideration

        The following table sets forth the closing sale price per share of Liberty QVCA common stock and HSNi common stock as reported on Nasdaq on July 5, 2017, the last trading day prior to the public announcement of the merger, and on August 28, 2017, the last practicable trading day before the filing of this proxy statement/prospectus with the SEC. The table also shows the estimated implied value of the stock consideration proposed for each share of HSNi common stock as of the same two dates. This implied value was calculated by multiplying the closing price of a share of Liberty QVCA common stock on the relevant date by the exchange ratio of 1.650 shares of Liberty QVCA common stock in exchange for each share of HSNi common stock.

 
  Liberty QVCA
Common Stock
  HSNi
Common Stock
  Implied Per
Share Value of
Stock
Consideration
 

July 5, 2017

  $ 24.46   $ 31.30   $ 40.36  

August 28, 2017

  $ 22.15   $ 36.50   $ 36.55  

        The market prices of Liberty QVCA common stock and HSNi common stock have fluctuated since the date of the public announcement of the merger agreement and will continue to fluctuate prior to, and in the case of Liberty QVCA common stock, after, completion of the merger. No assurance can be given concerning the market prices of Liberty QVCA common stock or HSNi common stock before completion of the merger or of Liberty QVCA common stock after completion of the merger. Pursuant to the terms of the merger agreement the exchange ratio is fixed, but the market price of Liberty QVCA common stock (and therefore the value of the merger consideration) to be received by HSNi stockholders in the merger could be greater than, less than or the same as the prices shown in the table above after the merger is completed. Accordingly, holders of Liberty QVCA common stock and HSNi stockholders are encouraged to obtain current market quotations for Liberty QVCA common stock and HSNi common stock and to review carefully the other information contained in this proxy statement/prospectus or incorporated by reference herein. For more information, see "Additional Information—Where You Can Find More Information."

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CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING STATEMENTS

        This proxy statement/prospectus and the documents incorporated by reference herein includes certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the Securities Act ) and Section 21E of the Exchange Act. Words such as "may," "will," "could," "anticipate," "estimate," "expect," "predict," "project," "future," "potential," "intend," "plan," "assume," "believe," "forecast," "look," "build," "focus," "create," "work," "continue" or the negative of such terms or other variations thereof and words and terms of similar substance used in connection with any discussion of future plans, actions, or events identify forward-looking statements. These forward-looking statements include:

        In addition to the risk factors described herein under the heading "Risk Factors," the following include some but not all of the factors that could cause actual results or events to differ materially from those expressed or implied by such statements, including, without limitation:

        These forward-looking statements and such risks, uncertainties and other factors speak only as of the date of this proxy statement/prospectus, and Liberty Interactive, QVC and HSNi expressly disclaim any obligation or undertaking to disseminate any updates or revisions to any forward-looking statement contained herein to reflect any change in Liberty Interactive's, QVC's or HSNi's expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based. When considering such forward-looking statements, you should keep in mind the factors described in "Risk Factors" and other cautionary statements contained or incorporated in this

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document. Such risk factors and statements describe circumstances which could cause actual results to differ materially from those contained in any forward-looking statement. Where, in any forward-looking statement, Liberty Interactive or HSNi express an expectation or belief as to future results or events, such expectation or belief is expressed in good faith and believed to have a reasonable basis, but such statements necessarily involve risks and uncertainties and there can be no assurance that the expectation or belief will result or be achieved or accomplished.

         Please refer to the publicly filed documents of Liberty Interactive, QVC and HSNi, including the most recent Forms 10-K and 10-Q for additional information about Liberty Interactive, QVC and HSNi and about the risks and uncertainties related to the business of each of Liberty Interactive, QVC and HSNi which may affect the statements made in this proxy statement/prospectus. For more information, see "Additional Information—Where You Can Find More Information."

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RISK FACTORS

         In addition to the other information included and incorporated by reference into this proxy statement/prospectus, including the matters addressed in "Cautionary Statement Concerning Forward-Looking Statements," you should carefully consider the following risks before deciding how to vote. In addition, you should read and consider the risks associated with each of the businesses of HSNi and Liberty Interactive because these risks will also affect the combined company following completion of the merger. These risks can be found in the Annual Reports on Form 10-K and Quarterly Reports on Form 10-Q of each of Liberty Interactive and HSNi, each of which is filed with the Securities and Exchange Commission (the SEC ) and incorporated by reference into this proxy statement/prospectus. You should also read and consider the other information in this proxy statement/prospectus and the other documents incorporated by reference into this proxy statement/prospectus. For more information, see "Additional Information—Where You Can Find More Information."

         If any of the following risks and uncertainties develop into actual events, these events could have a material adverse effect on the business, financial condition or results of operations of (i) prior to the merger, Liberty Interactive and/or HSNi, as applicable, and (ii) after the merger, the combined company. In addition, past financial performance may not be a reliable indicator of future performance, and historical trends should not be used to anticipate results or trends in future periods.

Risks Relating to the Merger

         The merger is subject to a number of conditions, and may not be completed on the terms or timeline currently contemplated, or at all.

        The consummation of the merger is subject to certain mutual conditions, including (i) the approval of the merger agreement proposal by the holders of at least a majority of the outstanding aggregate voting power of HSNi common stock, voting together as a single class, (ii) the expiration or termination of any waiting period applicable to the consummation of the merger under the HSR Act, (iii) the absence of any judgment, order, writ, injunction or decree of any court or other governmental authority that prohibits, renders illegal or permanently enjoins the consummation of the merger, (iv) the effectiveness of the registration statement on Form S-4 of which this proxy statement/prospectus forms a part and (v) the authorization for listing of the shares of Liberty QVCA common stock issuable in the merger on Nasdaq (subject to official notice of issuance). The obligation of each party to consummate the merger is also conditioned upon (i) the accuracy of the representations and warranties of the other party as of the date of the merger agreement and as of the closing (subject to, in certain cases, materiality and material adverse effect qualifiers), (ii) compliance by the other party in all material respects with its pre-closing obligations under the merger agreement and (iii) the absence of a material adverse effect with respect to the other party. Liberty Interactive's obligation to consummate the merger is also conditioned upon (i) the receipt of the FCC Approvals and (ii) the rights plan amendment remaining in effect and having not been terminated, amended or withdrawn.

        In addition, governmental authorities from which regulatory approvals are required may impose conditions on the completion of the merger or require changes to the terms of the merger or the merger agreement, which could have the effect of delaying or impeding completion of the merger, or of imposing additional costs or limitations on Liberty Interactive following completion of the merger.

        Liberty Interactive and HSNi cannot assure that the merger will be consummated on the terms or timeline currently contemplated or at all. Many of the conditions to the closing of the merger are not within the control of Liberty Interactive or HSNi, and neither company can predict when or if these conditions will be satisfied. The failure to meet all of the required conditions could delay the completion of the merger for a significant period of time or prevent it from occurring. Any delay in completing the merger could cause each of Liberty Interactive and HSNi not to realize some or all of

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the benefits that each expects to achieve if the merger is successfully completed within its expected timeframe.

        For more information, please see "Information About the Merger—Regulatory Approvals."

         Failure to complete the merger could adversely affect the stock prices and the future business and financial results of Liberty Interactive and HSNi.

        If the merger is not completed for any reason, including as a result of the HSNi stockholders failing to approve the merger agreement proposal, the ongoing businesses of Liberty Interactive and/or HSNi may be adversely affected and, without realizing any of the benefits of having completed the merger, Liberty Interactive and HSNi will be subject to numerous risks, including the following:

         The exchange ratio is fixed and will not be adjusted to reflect price changes of either Liberty QVCA common stock or HSNi common stock prior to the closing of the merger.

        In the merger, each outstanding share of HSNi common stock (other than shares held by HSNi as treasury stock and shares held by Liberty Interactive or any of its wholly owned subsidiaries) will automatically be converted into the exchange ratio of 1.650 shares of validly issued, fully paid and non-assessable shares of Liberty QVCA common stock. While the exchange ratio will be adjusted in certain limited circumstances set forth in the merger agreement, including a recapitalization, stock split, stock dividend or distribution, merger, subdivision, issuer tender or exchange offer or other similar transaction involving Liberty Interactive or HSNi, the exchange ratio is otherwise fixed and will not be adjusted for changes in the market price of either Liberty QVCA common stock or HSNi common stock prior to the closing of the merger.

        The market prices of Liberty QVCA common stock and HSNi common stock have fluctuated since the date of the public announcement of the merger agreement and will continue to fluctuate prior to, and in the case of Liberty QVCA common stock, after, completion of the merger. No assurance can be given concerning the market prices of Liberty QVCA common stock or HSNi common stock before completion of the merger or of Liberty QVCA common stock after completion of the merger. Pursuant to the terms of the merger agreement the exchange ratio is fixed, but the market price of Liberty QVCA common stock (and therefore the value of the merger consideration) to be received by HSNi stockholders in the merger could be greater than, less than or the same as the prices shown in the table above after the merger is completed. Liberty QVCA and HSNi stockholders are encouraged to obtain current market quotations for Liberty QVCA common stock and HSNi common stock and to review

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carefully the other information contained in this proxy statement/prospectus or incorporated by reference herein. For more information, see "Additional Information—Where You Can Find More Information."

        Stock price changes may result from a variety of factors (many of which are beyond the control of HSNi or Liberty Interactive), including the following:

        The price of Liberty QVCA common stock at the closing of the merger may vary from the price of Liberty QVCA common stock on the date the merger agreement was executed, on the date of this proxy statement/prospectus and on the date of the HSNi special meeting. As a result, the market value of the merger consideration will also vary. For example, based on the range of closing prices of Liberty QVCA common stock during the period from July 5, 2017, the last trading day before public announcement of the merger, through August 28, 2017, the latest practicable date before the filing of this proxy statement/prospectus, the merger consideration represented a market value per share of HSNi common stock ranging from a low of $34.49 to a high of $42.90.

        Because the merger will be completed, if at all, after the date of the HSNi special meeting, the exact market value of the shares of Liberty QVCA common stock that HSNi stockholders will receive upon completion of the merger cannot be known at the time of the HSNi special meeting.

        Therefore, while the number of shares of Liberty QVCA common stock to be issued per share of HSNi common stock is fixed, at the time they consider and vote upon the merger agreement proposal HSNi stockholders cannot be sure of the market value of the merger consideration they will receive upon completion of the merger.

         HSNi stockholders will have a reduced ownership and voting interest in the combined company following the merger, and will exercise less influence over management of the combined company.

        Because shares of Liberty QVCA common stock to be received by HSNi stockholders in the merger will not represent the same proportionate equity and voting interests as their existing shares of HSNi common stock represent in HSNi, this will result in HSNi stockholders having less influence over the management of the combined company. Based upon the number of outstanding shares on the HSNi record date for the HSNi special meeting, upon completion of the merger, we expect that former HSNi stockholders will own approximately 10.6% of the undiluted equity and 7.0% of the undiluted voting power of the QVC Group (based on the number of shares outstanding on July 31, 2017, the last practicable date prior to the date of filing this proxy statement/prospectus).

        It is also important to note that in light of Liberty Interactive's tracking stock structure, former HSNi stockholders will own approximately 6.0% of the aggregate voting power of Liberty Interactive on a consolidated basis, after taking into account the outstanding shares of Liberty Ventures common stock (based on the number of shares outstanding on July 31, 2017, the last practicable date prior to the date of filing this proxy statement/prospectus). Holders of QVC Group common stock and Liberty

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Ventures common stock generally vote together on all matters brought to a vote of the stockholders of Liberty Interactive, except as otherwise required by the restated certificate of incorporation of Liberty Interactive, as amended (the Liberty Interactive charter ) or applicable Delaware law. See "Comparison of Stockholders' Rights."

        Consequently, holders of QVC Group common stock and HSNi common stock, as a general matter, will have less influence over the management and policies of Liberty Interactive after the completion of the merger than they currently exercise over the management and policies of Liberty Interactive and HSNi, respectively.

         Liberty Interactive and HSNi expect to incur significant costs and expenses in connection with the merger.

        Each of Liberty Interactive and HSNi have incurred, and expect to further incur, certain nonrecurring costs in connection with the consummation of the merger, including advisory, legal and other transaction costs. A majority of these costs have already been incurred or will be incurred regardless of whether the merger is completed. While many of the expenses that will be incurred, by their nature, are difficult to estimate accurately at the present time, management of Liberty Interactive and HSNi continue to assess the magnitude of these costs, and additional unanticipated costs may be incurred in connection with the merger. Although Liberty Interactive and HSNi expect that the realization of benefits related to the merger will offset such costs and expenses over time, no assurances can be made that this net benefit will be achieved in the near term, or at all. See "Information About the Merger—Amount and Source of Funds and Financing of the Merger; Expenses."

         The announcement and pendency of the merger could divert the attention of management and cause disruptions in the businesses of HSNi and Liberty Interactive, which could have an adverse effect on the business and financial results of both HSNi and the QVC Group.

        Liberty Interactive and HSNi are currently operated independently of each other. Management of both HSNi and Liberty Interactive may be required to divert a disproportionate amount of attention away from their respective day-to-day activities and operations, and devote time and effort to consummating the merger. The risks, and adverse effects, of such disruptions and diversions could be exacerbated by a delay in the completion of the merger. These factors could adversely affect the financial position or results of operations of the QVC Group and HSNi, regardless of whether the merger is completed.

         HSNi is subject to contractual restrictions while the merger is pending, which could adversely affect HSNi's business.

        The merger agreement imposes certain restrictive interim covenants on HSNi. For instance, the consent of Liberty Interactive is required in respect of, among other things, amendments to HSNi's organizational documents, share repurchases, certain actions relating to material contracts, certain employee benefit changes, certain capital expenditures and dispositions, payments of dividends, and certain issuances of shares of HSNi common stock. These restrictions may prevent HSNi from taking certain actions before the closing of the merger or the termination of the merger agreement, including making certain acquisitions or otherwise pursuing certain business opportunities, or making certain changes to its capital stock, that the HSNi board may deem beneficial.

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         Liberty Interactive is subject to contractual restrictions while the merger is pending, which could adversely affect Liberty Interactive's business.

        Although less restrictive than those imposed on HSNi, the merger agreement does impose certain restrictive interim covenants on Liberty Interactive. For instance, the consent of HSNi is required in respect of, among other things, amendments to Liberty Interactive's organizational documents, certain payments of dividends with respect to shares of QVC Group common stock and certain issuances of shares of QVC Group common stock. These restrictions may prevent Liberty Interactive from taking certain actions before the closing of the merger or the termination of the merger agreement, including completing certain capital raising activities that the board of directors of Liberty Interactive (the Liberty Interactive board ) may deem beneficial.

         The merger agreement limits HSNi's ability to pursue alternative transactions.

        The merger agreement contains provisions that may discourage a third party from submitting an acquisition proposal to HSNi that might result in greater value to the HSNi stockholders than the merger, or may result in a potential acquiror of HSNi proposing to pay a lower per share price to acquire HSNi than it might otherwise have proposed to pay. These provisions include a general prohibition on HSNi soliciting or, subject to certain exceptions relating to the exercise of fiduciary duties by the HSNi board, entering into discussions with third parties regarding alternative transactions. In addition, pursuant to the merger agreement, HSNi has an unqualified obligation to submit the merger agreement proposal to a vote by the HSNi stockholders, even if HSNi receives an alternative transaction proposal that the HSNi board believes is superior to the merger, unless Liberty Interactive or HSNi, as applicable, terminates the merger agreement in accordance with its terms prior to such time. See "Information About the Merger—The Merger Agreement—Termination of the Merger Agreement."

         Certain provisions of the merger agreement could discourage a potential competing acquiror of HSNi or could result in any competing proposal being offered at a lower price than it might otherwise be.

        Pursuant to the merger agreement, HSNi may not solicit alternative transaction proposals, and HSNi may only engage with a competitive acquiror if the HSNi board receives a bona fide alternative transaction proposal that did not result from a material breach of its non-solicitation obligations and which the HSNi board determines to be, or to be reasonably expected to lead to, a superior transaction proposal, and the failure to take such action would be reasonably likely to be inconsistent with the directors' fiduciary duties, subject to the terms and conditions of the merger agreement. The merger agreement can be terminated by HSNi in order to enter into a superior transaction with a third party, but only subject to compliance with certain terms and conditions included in the merger agreement and upon payment of a termination fee of $40 million to Liberty Interactive. For more information, see "Information About the Merger—The Merger Agreement—No Solicitation."

        These provisions could discourage a potential competing acquiror that might have an interest in acquiring all or a significant part of HSNi from considering or proposing such an acquisition, even if it were prepared to pay consideration with a higher per share value than the value proposed to be received in the merger, or might result in a potential competing acquiror proposing to pay a lower price than it might otherwise have proposed to pay because of the added expense of the termination fee that may become payable in certain circumstances under the merger agreement.

         The pendency of the merger could adversely affect the business and operations of the QVC Group and HSNi.

        In connection with the pending merger, some customers or vendors of each of the QVC Group and HSNi may delay or defer decisions. Similarly, current and prospective employees of HSNi may

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experience uncertainty about their future roles with HSNi following the merger, which may materially adversely affect the ability of HSNi to attract and retain key personnel during the pendency of the merger. In particular, HSNi does not currently have a full-time chief executive officer, and the merger agreement imposes certain limitations on HSNi's ability to fill such position. In addition, due to operating covenants in the merger agreement, HSNi and, in some cases, Liberty Interactive, may be unable (without the other party's prior written consent), during the pendency of the merger, to pursue strategic transactions, undertake significant capital projects, undertake certain significant financing transactions and otherwise pursue other actions, even if such actions would prove beneficial. The risks, and adverse effects, of such disruptions could be exacerbated by a delay in the completion of the merger or termination of the merger agreement.

         Some of the directors and executive officers of HSNi have interests in seeing the merger completed that are different from, or in addition to, those of the HSNi stockholders.

        Directors and executive officers of HSNi may have interests in the merger that are different from, or in addition to, the interests of HSNi stockholders generally. These interests include, among others, the treatment of outstanding equity awards pursuant to the merger agreement, potential severance and other benefits upon a qualifying termination in connection with the merger, Liberty Interactive's agreement to appoint one member of the HSNi board (other than a director designated by Liberty Interactive) to the Liberty Interactive board at the closing, and certain rights to ongoing indemnification and insurance coverage. Additionally, Ms. Chun, who is a Liberty Interactive employee, and Mr. Costello, are Liberty Interactive's designees on the HSNi board and were designated by Liberty Interactive pursuant to the Spinco Agreement (as defined in "Certain Relationships and Related Party Transactions" and as further described in "Information About the Merger—Interests of Certain Persons of HSNi in the Merger."

         If the merger is not consummated by April 5, 2018 (unless extended under certain circumstances), either Liberty Interactive or HSNi may terminate the merger agreement.

        Either Liberty Interactive or HSNi may terminate the merger agreement if the merger has not been consummated by the outside date of April 5, 2018, subject to a six month extension by either Liberty Interactive or HSNi if the only closing condition(s) that have not been satisfied are related to the receipt of antitrust or FCC Approvals. However, this termination right will not be available to a party that failed to fulfill its obligations under the merger agreement and such failure was the cause of, or resulted in, the failure to consummate the merger. No termination fee is payable by either party for a termination of the merger agreement, except in limited circumstances.

        HSNi will pay Liberty Interactive a termination fee of $40 million (i) if an alternative transaction proposal is made to HSNi, (ii) thereafter the merger agreement is terminated by either party for failure to consummate the merger by the outside date (at such time as the HSNi stockholders have failed to approve the transactions), and (iii) within 15 months of such termination, HSNi enters into an alternative transaction and such alternative transaction is consummated.

        Similarly, Liberty Interactive will pay HSNi a termination fee of $75 million (i) if the merger has not been consummated on or before the outside date (as it may be extended) as a result of the required regulatory approvals having not been obtained or (ii) if any court or other governmental authority has issued an order or taken any other action permanently restraining, enjoining or otherwise prohibiting the merger under any competition law or the Communications Act and such order or other action is, or has become, final and non-appealable. For more information, see "Information About the Merger—The Merger Agreement—Termination of the Merger Agreement."

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         Sales of Liberty QVCA common stock after the completion of the merger may cause the market price of Liberty QVCA common stock shares to fall.

        Based upon the number of outstanding shares of HSNi common stock on the HSNi record date, we expect that Liberty Interactive will issue approximately [     ·     ] shares of Liberty QVCA common stock in the merger.

        Many former HSNi stockholders may decide not to hold the shares of Liberty QVCA common stock they will receive in the merger. Such sales of Liberty QVCA common stock could have the effect of depressing the market price for Liberty QVCA common stock, and may take place promptly following the merger.

         The Liberty QVCA common stock to be received by HSNi stockholders in the merger will have rights different from shares of HSNi common stock.

        Upon completion of the merger, HSNi stockholders will no longer hold shares of HSNi common stock but will instead become holders of shares of Liberty QVCA common stock, and their rights as stockholders of Liberty Interactive will be governed by the terms of the Liberty Interactive charter, the amended and restated bylaws of Liberty Interactive (the Liberty Interactive bylaws ) and by the DGCL. The terms of the Liberty Interactive charter are in many respects different from the terms of the amended and restated certificate of incorporation of HSNi (the HSNi charter ) and the amended and restated bylaws of HSNi (the HSNi bylaws ). See "Comparison of Stockholders' Rights" for a discussion of the different rights associated with Liberty QVCA common stock.

         The unaudited pro forma condensed combined financial statements included in this proxy statement/prospectus are for illustrative purposes and the actual financial condition and results of operations after the merger may differ materially.

        The unaudited pro forma condensed combined financial statements in this document are presented for illustrative purposes only and are not necessarily indicative of what the combined company's actual financial condition or results of operations would have been had the merger been completed on the dates indicated. The unaudited pro forma condensed combined financial statements reflect adjustments, which are based upon assumptions and preliminary estimates, to record the HSNi identifiable assets acquired and liabilities assumed at fair value and the resulting goodwill recognized. The purchase price allocation reflected in this document is preliminary, and final allocation of the purchase price will be based upon the actual purchase price and the fair value of the assets and liabilities of HSNi as of the date of the completion of the merger. Accordingly, the final acquisition accounting adjustments may differ materially from the pro forma adjustments reflected in this document. For more information, see "Unaudited Comparative Per Share Information" and "Unaudited Pro Forma Condensed Combined Financial Statements" of this proxy statement/prospectus.

         The unaudited forecasted financial information of HSNi and the QVC Group included in this proxy statement/prospectus are presented for illustrative purposes only and involves risks, uncertainties and assumptions, many of which are beyond the control of HSNi and Liberty Interactive. As a result, it may not prove to be accurate and is not necessarily indicative of current values or future performance.

        The unaudited forecasted financial information of HSNi and the QVC Group contained in "Information About the Merger—Unaudited Forecasted Financial Information" of this proxy statement/prospectus involves risks, uncertainties and assumptions and is not a guarantee of future performance. The future financial results of the HSNi and the QVC Group may materially differ from those expressed in the unaudited forecasted financial information due to factors that are beyond HSNi's and Liberty Interactive's respective ability to control or predict. No assurances can be made regarding future events or that the assumptions made in preparing the unaudited forecasted financial

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information will accurately reflect future conditions. The unaudited forecasted financial information was based on numerous variables and assumptions that are inherently subjective, and depend on a number of factors, including risks and uncertainties relating to the businesses of HSNi and the QVC Group (including the ability of each to achieve strategic goals, objectives and targets over applicable periods), industry performance, general business and economic conditions, and other factors described or incorporated by reference in this section or the section entitled "Cautionary Statement Concerning Forward-Looking Statements," all of which are uncertain and many of which are beyond the control of HSNi and Liberty Interactive, and, if the merger is completed, will be beyond the control of the combined company. Neither HSNi nor Liberty Interactive can provide any assurance that its future financial results, or if the merger is completed, those of the combined company, will not materially vary from the unaudited forecasted financial information. The unaudited forecasted financial information is not fact and should not be relied upon as being necessarily indicative of future results, and readers of this proxy statement/prospectus are cautioned not to place undue reliance on the unaudited forecasted financial information. The unaudited forecasted financial information covers multiple years, and the information by its nature becomes subject to greater uncertainty with each successive year. The unaudited forecasted financial information does not take into account any circumstances or events occurring after the date it was prepared.

        More specifically, the unaudited forecasted financial information:

        The unaudited forecasted financial information was not prepared with a view toward public disclosure or compliance with published guidelines of the SEC or the American Institute of Certified Public Accountants for preparation and presentation of prospective financial information or GAAP and does not reflect the effect of any proposed or other changes in GAAP that may be made in the future.

        Neither Liberty Interactive nor HSNi intend to update or otherwise revise the unaudited forecasted financial information to reflect circumstances existing after the date when made or reflect the occurrence of future events, even in the event that any or all of the assumptions underlying such unaudited forecasted financial information are no longer appropriate, except as may be required by law.

         The fairness opinions obtained by the Special Committee from Centerview Partners and Goldman Sachs will not reflect changes, circumstances, developments or events that have occurred or may occur after the date of their respective opinions.

        On July 5, 2017, Centerview Partners rendered its oral opinion to the Special Committee (with the other Qualified Directors present), which was subsequently confirmed by delivery of a written opinion dated such date, as of such date and based upon and subject to the assumptions made, procedures followed, matters considered, and qualifications and limitations upon the review undertaken by Centerview Partners in preparing its opinion, as to the fairness, from a financial point of view, of the

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merger consideration to be received by the HSNi stockholders (other than as specified in such opinion) pursuant to the merger agreement.

        Also on July 5, 2017, Goldman Sachs rendered its oral opinion to the Special Committee (with the other Qualified Directors present), which was subsequently confirmed by delivery of a written opinion dated such date, as of such date and based upon and subject to the factors and assumptions set forth therein, as to the fairness, from a financial point of view, of the exchange ratio to be received by the HSNi stockholders (other than Liberty Interactive, a significant stockholder of Liberty Interactive, and their respective affiliates) pursuant to the merger agreement.

        Both financial advisor opinions were necessarily based on economic, market, financial and other conditions as they existed on, and on the information made available to Centerview Partners and Goldman Sachs as of the date of the opinion, including the unaudited forecasted financial information summarized in the section "Information About the Merger—Unaudited Forecasted Financial Information." The opinions do not speak as of the time the merger will be completed or as of any date other than the date of the opinion. Subsequent developments, including changes to the operations and prospects of Liberty Interactive or HSNi, regulatory or legal changes, general market and economic conditions and other factors that may be beyond the control of Liberty Interactive or HSNi, and on which Centerview Partners' or Goldman Sachs' opinions were based, may alter the value of Liberty Interactive or HSNi or the prices of shares of Liberty QVCA common stock or shares of HSNi common stock at the effective time. The value of the merger consideration to be received based on the exchange ratio has fluctuated since, and could be materially different from its value as of, the date of Centerview Partners' and Goldman Sachs' opinions. Because HSNi does not currently anticipate asking its financial advisors to update their opinions, their opinions will not address the fairness of the merger consideration from a financial point of view at the time the merger is completed, or at any other time other than the date the opinions were delivered.

        For a more complete description of the opinions that Centerview Partners and Goldman Sachs delivered, and a summary of the material financial analyses performed, in connection with such opinions, please refer to the sections "Information About the Merger—Opinion of the Special Committee Financial Advisor (Centerview Partners)" and "—Opinion of the Special Committee Financial Advisor (Goldman Sachs)," respectively. A copy of the opinion of Centerview Partners is attached as Annex C, a copy of the opinion of Goldman Sachs is attached as Annex D to this proxy statement/prospectus, and each is incorporated by reference herein.

         The GCI transactions could result in a significant tax liability to Liberty Interactive.

        It is a condition to the GCI transactions that Liberty Interactive receive the opinion of Skadden, Arps, Slate, Meagher & Flom LLP ( Skadden Arps ), in form and substance reasonably acceptable to Liberty Interactive, to the effect that, for U.S. federal income tax purposes, the GCI transactions will qualify as a tax-free transaction to Liberty Interactive and holders of Liberty Ventures common stock under Section 355, Section 368(a)(1)(D) and related provisions of the Code.

        The opinion of Skadden Arps will be based on the law in effect as of the time of the GCI transactions and will rely upon certain assumptions, as well as statements, representations and undertakings made by officers of Liberty Interactive, GCI Liberty and Mr. John C. Malone. These assumptions, statements, representations and undertakings are expected to relate to, among other things, Liberty Interactive's and GCI Liberty's business reasons for engaging in the GCI transactions, the conduct of certain business activities by Liberty Interactive and GCI Liberty, and the plans and intentions of Liberty Interactive and GCI Liberty to continue conducting those business activities and not to materially modify their ownership or capital structure following the GCI transactions. If any of those statements, representations or assumptions is incorrect or untrue in any material respect or any of those undertakings is not complied with, or if the facts upon which the opinion is based are

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materially different from the actual facts that exist at the time of the GCI transactions, the conclusions reached in such opinion could be adversely affected.

        Liberty Interactive does not intend to seek a ruling from the IRS as to the U.S. federal income tax treatment of the GCI transactions. The legal authorities upon which the opinion of Skadden Arps will be based are subject to change or differing interpretations at any time, possibly with retroactive effect. The opinion of Skadden Arps will not be binding on courts or the IRS, and there can be no assurance that the IRS will not challenge the conclusions reached in the opinion or that a court would not sustain such a challenge.

        Even if the GCI transactions otherwise qualify under Section 355, Section 368(a)(1)(D) and related provisions of the Code, the GCI transactions would result in a significant U.S. federal income tax liability to Liberty Interactive (but not to holders of Liberty Ventures common stock) under Section 355(e) of the Code if one or more persons acquire, directly or indirectly, a 50% or greater interest (measured by either vote or value) in the stock of Liberty Interactive or in the stock of GCI Liberty (or any successor corporation) (excluding, for this purpose, the acquisition of GCI Liberty common stock by Liberty Interactive in the GCI transactions and by holders of Liberty Ventures common stock in the GCI transactions) as part of a plan or series of related transactions that includes the GCI transactions. Any acquisition of the stock of Liberty Interactive or GCI Liberty (or any successor corporation) within two years before or after the GCI transactions would generally be presumed to be part of a plan that includes the GCI transactions, although the parties may be able to rebut that presumption under certain circumstances. The process for determining whether an acquisition is part of a plan under these rules is complex, inherently factual in nature and subject to a comprehensive analysis of the facts and circumstances of the particular case. Notwithstanding the opinion of Skadden Arps described above, Liberty Interactive or GCI Liberty might inadvertently cause or permit a prohibited change in ownership of Liberty Interactive or GCI Liberty, thereby triggering tax liability to Liberty Interactive, which could have a material adverse effect.

        Pursuant to the tax sharing agreement that Liberty Interactive will enter into with GCI Liberty in connection with the GCI transactions (the Tax Sharing Agreement ), GCI Liberty will be required to indemnify Liberty Interactive, its subsidiaries and certain related persons for taxes and losses resulting from the failure of the GCI transactions to qualify as a tax-free transaction under Section 355, Section 368(a)(1)(D) and related provisions of the Code to the extent that such taxes and losses (i) result primarily from, individually or in the aggregate, the breach of certain covenants made by GCI Liberty (applicable to actions or failures to act by GCI Liberty and its subsidiaries following the completion of the GCI transactions) or (ii) result from the application of Section 355(e) of the Code to the GCI transactions as a result of the treatment of the GCI transactions as part of a plan (or series of related transactions) pursuant to which one or more persons acquire, directly or indirectly, a 50% or greater interest (measured by vote or value) in the stock of GCI Liberty (or any successor corporation).

        If it is subsequently determined that the GCI transactions do not qualify for tax-free treatment, and GCI Liberty does not have an obligation to indemnify Liberty Interactive under the Tax Sharing Agreement for tax liabilities incurred as a result of the GCI transactions or GCI Liberty fails to comply with its indemnification obligations, Liberty Interactive could incur significant tax liabilities which could have a material adverse effect. Further, in light of the requirements under Section 355 of the Code, Liberty Interactive might determine to forgo certain transactions, including stock issuances, certain asset dispositions and other strategic transactions for some period of time following the GCI transactions.

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         The completion of the merger is not conditioned on the receipt of an opinion of counsel to the effect that the merger will qualify for the Intended Tax Treatment, and no ruling has been or will be sought from the IRS regarding the U.S. federal income tax consequences of the merger.

        It is intended that, for U.S. federal income tax purposes, the merger will qualify as a "reorganization" within the meaning of Section 368(a) of the Code, which we refer to as the Intended Tax Treatment. However, the completion of the merger is not conditioned on the merger qualifying for the Intended Tax Treatment or upon the receipt of an opinion of counsel to that effect. In addition, neither Liberty Interactive nor HSNi intends to request a ruling from the IRS regarding the U.S. federal income tax consequences of the merger. Accordingly, no assurance can be given that the merger will qualify for the Intended Tax Treatment. Further, even if Liberty Interactive and HSNi conclude that the merger qualifies for the Intended Tax Treatment, no assurance can be given that the IRS will not challenge that conclusion or that a court would not sustain such a challenge. Each HSNi stockholder should read the discussion under "Material U.S. Federal Income Tax Consequences" and should consult its own tax advisor for a full understanding of the tax consequences of the merger to such stockholder.

Risks Relating to the Combined Company After Completion of the Merger

         Following the merger, Liberty Interactive may be unable to integrate the businesses of QVC and HSNi successfully or realize the anticipated synergies and related benefits of the merger or do so within the anticipated time frame.

        The merger involves the combination of two companies which currently operate as independent companies. Liberty Interactive will be required to devote significant management attention and resources to integrating the businesses and operations of HSNi. Potential difficulties QVC or HSNi may encounter in the integration process include the following:

        For all these reasons, you should be aware that it is possible that the integration process could result in the distraction of QVC's or HSNi's management, the disruption of Liberty Interactive's ongoing business or inconsistencies in Liberty Interactive's services, standards, controls, procedures and policies, any of which could adversely affect the ability of Liberty Interactive to maintain relationships with customers, vendors and employees or to achieve the anticipated benefits of the merger, or could otherwise adversely affect the business and financial results of Liberty Interactive following the merger.

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         Following the merger, Liberty Interactive does not expect to pay dividends.

        Liberty Interactive expects that, following the merger, it will not continue HSNi's quarterly dividend payments. Liberty Interactive has not paid any cash dividends on shares of QVC Group common stock, and has no present intention of so doing. Payment of dividends, if any, in the future will be determined by the Liberty Interactive board in light of earnings, financial condition and other relevant considerations.

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INFORMATION ABOUT THE MERGER

         The following is a discussion of the merger and the material terms of the merger agreement by and among Liberty Interactive, Merger Sub and HSNi. This discussion is qualified in its entirety by reference to the merger agreement, and you are urged to read the merger agreement carefully and in its entirety, a copy of which is attached as Annex A to this proxy statement/prospectus and incorporated by reference into this proxy statement/prospectus.

Background of the Merger

         The following chronology summarizes the key meetings and events that led to the signing of the merger agreement. The following chronology does not purport to catalogue every conversation among the HSNi board or Liberty Interactive board, or the representatives of each company, their respective advisors or any other persons.

        The HSNi board and HSNi management regularly review and assess HSNi's operations, performance, prospects and strategic direction, and evaluate the possibility of pursuing various strategic transactions and other strategic alternatives as part of ongoing efforts to strengthen the business and enhance stockholder value, while taking into account economic, regulatory, competitive and other conditions.

        On December 9, 2016, Mr. Gregory B. Maffei, Liberty Interactive's President and Chief Executive Officer, telephoned Mr. Arthur C. Martinez, Chairman of the HSNi board, to discuss the retail industry generally, and the possibility of a potential strategic transaction involving Liberty Interactive and HSNi. Mr. Maffei expressed his view that combining the two companies in an all-stock transaction could provide significant benefits to both Liberty Interactive and the HSNi stockholders, and that he believed any takeover premium had already been priced in to HSNi's current trading price. Mr. Martinez advised Mr. Maffei that he would relay the discussion to the HSNi board and respond to Mr. Maffei in due course.

        On December 14, 2016, the HSNi board (with the exception of Ms. Chun and Mr. Costello, Liberty Interactive's nominees on the HSNi board, who agreed to recuse themselves from this meeting) held a meeting during which Mr. Martinez informed the HSNi board of his discussion with Mr. Maffei. A representative of Davis Polk & Wardwell LLP ( Davis Polk ), participated in the meeting and reviewed with the HSNi board certain legal matters including the directors' fiduciary duties in connection with their consideration of a potential strategic transaction and the terms of the Spinco Agreement with Liberty Interactive (which is described in more detail in the section entitled "Certain Relationships and Related Party Transactions—Relationship Between HSNi and Liberty Interactive—Spinco Agreement"). Following discussion, the HSNi board approved resolutions authorizing the creation of the Special Committee, and vested it with the power to (i) review, evaluate and negotiate the terms and conditions of a potential strategic transaction involving Liberty Interactive and, if the Special Committee deemed it appropriate, alternative transactions, including the possibility of a sale, merger or recapitalization of all or any portion of HSNi, (ii) negotiate with Liberty Interactive any such potential transaction, (iii) negotiate with any other party or parties the terms of any such alternative transaction, (iv) negotiate the terms of any definitive agreement with respect to any such transaction, the execution of which would be subject to the approval of the HSNi board, (v) determine and recommend to the HSNi board whether any such potential transaction was advisable and fair to and in the best interests of the HSNi stockholders and (vi) determine to elect not to pursue any such potential transaction. The HSNi board resolved not to recommend or approve any such transaction without a prior favorable recommendation from the Special Committee. The HSNi board appointed Mr. James Follo, Mr. Martinez, and Mr. Thomas McInerney as the initial members of the Special Committee, each of whom was determined by the HSNi board to be disinterested with respect to a potential strategic transaction involving Liberty Interactive and free of any relationship that, in the opinion of the HSNi

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board, would interfere with their independent judgment as a member of the Special Committee. The HSNi board then appointed Mr. Martinez as Chairman of the Special Committee.

        On December 19, 2016, the Special Committee held a telephonic meeting and authorized Mr. Martinez to inform Mr. Maffei that HSNi had formed a special committee to review and evaluate potential strategic transactions with Liberty Interactive and other potential third parties and was in the process of retaining a financial advisor. The Special Committee then determined that Mr. Martinez should arrange interviews with multiple financial advisors, including Centerview Partners and Goldman Sachs, to discuss their interest and qualifications to serve as a financial advisor to the Special Committee in connection with a potential transaction. Representatives of Davis Polk then reviewed with the Special Committee certain legal matters including the Special Committee's fiduciary duties in connection with their consideration of a potential strategic transaction and the Special Committee's express authorization to retain legal counsel as it deemed necessary. Thereafter, all representatives of Davis Polk left the telephonic meeting. After discussion, the Special Committee unanimously determined that it was advisable and in the best interests of HSNi and the HSNi stockholders to retain Davis Polk as independent legal counsel to the Special Committee, based on its qualifications, experience and reputation and following disclosure to the Special Committee of Davis Polk's relationships with HSNi.

        On December 22, 2016, Mr. Martinez telephoned Mr. Maffei to inform Mr. Maffei that HSNi had formed a special committee to review and evaluate potential strategic transactions with Liberty Interactive and other potential third parties and was in the process of retaining financial advisors.

        On January 5, 2017, the Special Committee held a meeting. Representatives of Davis Polk participated in the meeting. At the invitation of the Special Committee, representatives of Goldman Sachs joined the meeting. At the meeting, representatives of Goldman Sachs described their qualifications to serve as financial advisor to the Special Committee, noting their prior experience working opposite Mr. Maffei and Liberty Interactive. Goldman Sachs presented the Special Committee with various strategies that HSNi could pursue to maximize stockholder value. The Special Committee asked questions and discussed numerous aspects of the presentation, including, among others, strategies for maximizing stockholder value when dealing with a significant stockholder and the implications of Liberty Interactive's tracking and low-vote stock. After the representatives of Goldman Sachs were excused from the meeting, and at the request of the Special Committee, representatives of Centerview Partners joined the meeting. Representatives of Centerview Partners described their qualifications to serve as financial advisor to the Special Committee, focusing in particular on prior experience working opposite Mr. Maffei and Liberty Interactive, their familiarity with HSNi's business from prior work they had done for HSNi, and their involvement in other significant stockholder situations. Centerview Partners presented the Special Committee with various strategies that HSNi could pursue to maximize stockholder value. The Special Committee asked questions and discussed numerous aspects of the presentation, including, among others, strategies for maximizing stockholder value when dealing with a significant stockholder and the implications of Liberty Interactive's tracking and low-vote stock. After the representatives of Centerview Partners were excused from the meeting, the Special Committee reviewed and discussed the qualifications of each of Goldman Sachs and Centerview Partners to serve as financial advisor to the Special Committee, taking into account their prior experiences with each firm, the firms' and the deal teams' experience advising on complex transactions, particularly in the retail industry, and in transactions involving Liberty Interactive and Mr. Maffei. The Special Committee also considered Centerview Partners' prior work for HSNi. The Special Committee then reviewed each financial advisor's responses to a questionnaire regarding its and its affiliates' relationships with certain entities and individuals, including Liberty Interactive, Dr. John C. Malone, Chairman of the Board of Liberty Interactive and Mr. Maffei. The Special Committee considered the facts and circumstances surrounding such relationships in determining whether to engage Centerview Partners and Goldman Sachs to provide financial advisory services to HSNi. The Special Committee discussed the benefits of

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retaining more than one financial advisor. After discussion, the Special Committee unanimously determined it was advisable and in the best interests of HSNi and its stockholders to retain both Goldman Sachs and Centerview Partners as financial advisors to the Special Committee and authorized Mr. Martinez to retain both Goldman Sachs and Centerview Partners.

        On January 13, 2017, the Special Committee held a telephonic meeting. Representatives of Davis Polk, Centerview Partners and Goldman Sachs participated in the meeting. Mr. Martinez informed the Special Committee and its advisors that he had not been contacted by Mr. Maffei since their December 22, 2016 call, but that he had instructed HSNi's then-current management to continue preparing HSNi's 2017 and 2018 financial plans expeditiously for presentation to the Qualified Directors as part of HSNi's regular January 2017 HSNi board meeting. Following discussion, the Special Committee directed Mr. Martinez to notify Mr. Maffei that the Special Committee had engaged financial advisors and would be prepared to engage with Liberty Interactive in two to three weeks' time. Representatives of Davis Polk noted that Ms. Chun and Mr. Costello, Liberty Interactive's nominees on the HSNi board, had agreed to recuse themselves from meetings or discussions relating to the ongoing strategic review process, including those regarding HSNi's forecasts and valuation. Representatives of Centerview Partners and Goldman Sachs then led a discussion regarding publicly available information regarding QVC.

        On January 18, 2017, Mr. Martinez informed Mr. Maffei that the Special Committee had retained Centerview Partners and Goldman Sachs (which are sometimes referred to collectively as the financial advisors ) and that they were in the process of conducting their analysis.

        On January 30, 2017, the Qualified Directors held a meeting. Mr. Rod Little, Chief Financial Officer of HSNi, reviewed with the Qualified Directors HSNi's then-current management projections for the years 2017 through 2021 for HSNi on a stand-alone basis, and the Special Committee approved the projections for use by the financial advisors in connection with their analyses. Representatives of Davis Polk, Centerview Partners and Goldman Sachs then joined for a portion of the meeting in order to review with the Qualified Directors (i) HSNi's management projections in the context of historical performance, previous HSNi management estimates, Wall Street consensus estimates, and retail company performance, (ii) retail industry trends and valuation, (iii) the potential importance of a transaction with HSNi for Liberty Interactive and the QVC Group and (iv) the status of the Special Committee's strategic review process more broadly.

        On February 9, 2017, the Special Committee held a telephonic meeting. Representatives of Davis Polk, Centerview Partners and Goldman Sachs, and members of HSNi management participated in the meeting. Mr. Martinez informed the Special Committee that Mr. Little had informed him that HSNi's revenue for January 2017 would be lower than its revenue for January 2016. Representatives of Centerview Partners and Goldman Sachs led a discussion regarding various aspects of HSNi's operating performance and strategic environment, including a general overview of retail industry dynamics, public market perspectives on HSNi, a review of HSNi's stand-alone plan, a preliminary financial analysis of HSNi, public market perspectives on QVC, a preliminary financial analysis of QVC, a pro forma evaluation of a potential combination of HSNi and QVC based on publicly available data for QVC, and a preliminary evaluation of potential strategic alternatives, including a break-up of HSNi through a sale of its Cornerstone business division, a re-purchase of Liberty Interactive's ownership of HSNi and the sale of HSNi to a potential third party. The Special Committee discussed the extent to which HSNi's current stock price reflected a premium associated with the market's expectation that QVC would eventually acquire 100% of HSNi and the value of any cost and revenue synergies that could result from a possible combination of HSNi and QVC. Following discussion, the Special Committee determined to engage in further discussions with Liberty Interactive and that Mr. Martinez would contact Mr. Maffei to advise him that HSNi was now prepared to discuss a possible strategic transaction.

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        On February 14, 2017, Mr. Martinez telephoned Mr. Maffei to inform him that HSNi was prepared to discuss a possible strategic transaction, but that any such transaction would need to adequately compensate the HSNi stockholders for the value of any synergies derived from the transaction and for the change of control. Mr. Maffei requested information regarding HSNi's current business plan. Mr. Martinez informed Mr. Maffei that HSNi was not willing to share that information at this stage, and asked Mr. Maffei to provide an initial indication regarding value. Mr. Maffei informed Mr. Martinez that he would be in touch to propose a process for further engagement. Later on February 14, 2017, Mr. Martinez provided a telephonic update to the Special Committee, along with representatives of Davis Polk, Centerview Partners and Goldman Sachs, regarding his discussion with Mr. Maffei.

        On February 16, 2017, Mr. Maffei telephoned Mr. Martinez to inform him that he intended to contact the Special Committee's financial advisors on February 21, 2017 to discuss a possible strategic transaction between HSNi and Liberty Interactive.

        On February 21, 2017, Mr. Maffei telephoned representatives of Centerview Partners and Goldman Sachs to inform them that Liberty Interactive expected to create an asset-based stock for QVC, zulily and HSNi, which he believed would be eligible for possible inclusion in stock indices and trade at a premium relative to the QVC Group tracking stock.

        Later on February 21, 2017, the Special Committee held a telephonic discussion that included representatives of Davis Polk, Centerview Partners and Goldman Sachs. The representatives of the financial advisors updated the Special Committee regarding their earlier conversation with Mr. Maffei relating to the creation of an asset-based stock for QVC, zulily and HSNi. The representatives of Centerview Partners and Goldman Sachs also informed the Special Committee that they impressed upon Mr. Maffei the Special Committee's view that the HSNi stockholders receive an appropriate control premium and share of the value of any synergies resulting from any potential transaction involving HSNi and Liberty Interactive.

        On February 24, 2017, representatives of Centerview Partners and Goldman Sachs called Mr. Maffei to follow-up on the February 16, 2017 discussion between Mr. Martinez and Mr. Maffei. During the call, Mr. Maffei indicated that Liberty Interactive would be in touch in the next two to three weeks to discuss a strategic transaction involving HSNi and Liberty Interactive.

        Also on February 24, 2017, the HSNi board held its regular quarterly meeting. Representatives of Davis Polk, Centerview Partners and Goldman Sachs joined for a portion of the meeting in order to update the members of the HSNi board on their analyses, including HSNi's recent performance, the Special Committee's strategic review process more broadly, and potential strategic alternatives for HSNi that had been previously discussed with the Special Committee. Ms. Chun and Mr. Costello recused themselves from this portion of the meeting. Representatives of Centerview Partners and Goldman Sachs informed the Qualified Directors that they had conveyed to Mr. Maffei the Special Committee's view that any transaction involving Liberty Interactive should provide the HSNi stockholders with an appropriate control premium and share of the resulting synergies.

        On March 9, 2017, the Qualified Directors held a follow-up meeting with representatives of Davis Polk, Centerview Partners and Goldman Sachs. Representatives of Centerview Partners and Goldman Sachs updated the Qualified Directors regarding recent stock price performance for HSNi, the QVC Group and other retail companies, an update on the preliminary financial analysis of HSNi and the QVC Group and the status of the Special Committee's evaluation of potential strategic alternatives.

        Also on March 9, 2017, Mr. Maffei called a representative of Goldman Sachs to further outline his expectations for a potential transaction with HSNi. Mr. Maffei informed the representative of Goldman Sachs of his view that the HSNi common stock was overvalued by the market, while the Liberty QVCA common stock was undervalued by the market, and his belief that the disparity was due in part to the

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fact that Liberty QVCA common stock is a tracking stock and not included in stock indices, and that the market viewed HSNi as a potential takeover target. Mr. Maffei suggested to the representative of Goldman Sachs that they combine the two companies at fair value in a transaction that would compensate the HSNi stockholders for roughly half of the estimated $750 million of net present value of synergies, net of transaction fees, that Liberty Interactive expected to be realized as a result of a potential combination of Liberty Interactive and HSNi, which was equal to approximately $100 million of annual synergies capitalized at a multiple of 8x, net of an estimated $50 million in transaction fees. Mr. Maffei indicated that Liberty Interactive was exploring ways to announce a deal that would create an asset-based stock consisting of QVC and zulily and Liberty Interactive's stake in HSNi. The representative of Goldman Sachs conveyed this information to the Special Committee later that day.

        On March 10, 2017, the Special Committee held a telephonic discussion that included representatives of Davis Polk, Centerview Partners and Goldman Sachs. The Special Committee discussed with representatives of Davis Polk, Centerview Partners and Goldman Sachs the contours of the potential transaction discussed with Mr. Maffei. Following discussion, the Special Committee directed HSNi management to further refine their analysis of the potential synergies that could be generated by a combination of Liberty Interactive and HSNi.

        On March 15, 2017, the Liberty Interactive board held a meeting at which representatives of Liberty Interactive management informed the Liberty Interactive board that there were preliminary discussions occurring with HSNi regarding a potential transaction.

        On March 28, 2017, Mr. Maffei called representatives of Centerview Partners and Goldman Sachs to inform them that Liberty Interactive expected to announce a transaction in the next two weeks that would separate its QVC Group and Ventures Group assets and liabilities into separate companies, each with asset-based stocks.

        On March 29, 2017, the Special Committee held a telephonic discussion that included representatives of Davis Polk, Centerview Partners and Goldman Sachs. The representatives of Goldman Sachs and Centerview Partners provided an update regarding their March 28, 2017 call with Mr. Maffei, and advised the Special Committee that they expected Mr. Maffei to make a proposal regarding a transaction with HSNi after the market had an opportunity to incorporate the impact of the announcement of the proposed transaction referred to by Mr. Maffei in their March 28, 2017 call.

        On April 4, 2017, Liberty Interactive announced that it had entered into an agreement to acquire GCI in a transaction expected to result in certain Ventures Group assets and liabilities being split off from Liberty Interactive, leaving behind the QVC Group assets and liabilities.

        On April 17, 2017, representatives of Goldman Sachs and Centerview Partners called Mr. Maffei to discuss the timing of a potential strategic combination. The representatives of Centerview Partners and Goldman Sachs informed Mr. Maffei that this process had been consuming a significant amount of HSNi management's time and the Special Committee wanted to either proceed expeditiously with discussions regarding a potential combination of HSNi and Liberty Interactive or abandon discussions and focus on executing HSNi's stand-alone plan. Mr. Maffei indicated that Liberty Interactive intended to wait until after the release of Liberty Interactive's first quarter earnings on May 9, 2017 before discussing further.

        On April 21, 2017, Ms. Mindy Grossman, Chief Executive Officer of HSNi and a member of the HSNi board, delivered to the HSNi board her written resignation from HSNi, including in her capacity as a director and officer of HSNi. The HSNi board accepted Ms. Grossman's resignation effective May 24, 2017.

        On April 24, 2017, the HSNi board established, on an interim basis, an Office of the Chief Executive, which included Mr. Little, Mr. William C. Brand, President of HSN and Chief Marketing

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Officer of HSNi, and Ms. Judy Schmeling, President of Cornerstone Brands and Chief Operating Officer of HSNi, with Mr. Little acting as HSNi's interim principal executive officer.

        On May 10, 2017, Liberty Interactive confidentially provided the HSNi board with a preliminary, non-binding proposal to acquire 100% of HSNi's stock for $40.50 per share payable in shares of Liberty QVCA common stock in an all-stock transaction (representing a premium of approximately 9.5% to HSNi's closing price as of May 10, 2017), which proposal also indicated that HSNi would be entitled to designate appropriate board representation in connection with the completion of any such transaction, and that the proposed merger consideration included therein was subject to a number of contingencies, including the completion of due diligence and execution of definitive agreements.

        On May 11, 2017, the Special Committee held a telephonic meeting regarding the proposal received from Liberty Interactive. Representatives of Davis Polk, Centerview Partners and Goldman Sachs participated in the meeting. The Special Committee discussed the terms of Liberty Interactive's May 10 proposal, including the manner in which synergies would be shared by the HSNi stockholders and the floating exchange ratio included in the proposal. Representatives of the financial advisors provided their initial analysis of the proposal, including a summary of Liberty Interactive's previously announced transaction with GCI, in addition to a review of both HSNi and the QVC Group's recent earnings reports. The Special Committee noted that the proposal was not conditioned on the completion of the transaction with GCI. The Special Committee discussed the importance of closing certainty in light of the recently announced departure of Ms. Grossman. The Special Committee agreed to reconvene on May 15, 2017, to discuss the proposal in greater detail after Centerview Partners and Goldman Sachs had an opportunity to complete their analysis.

        On May 15, 2017, the Special Committee held a telephonic meeting regarding the proposal received from Liberty Interactive. Representatives of Davis Polk, Centerview Partners and Goldman Sachs participated in the meeting. The Special Committee reviewed various components of Liberty Interactive's May 10 proposal and Centerview Partners' and Goldman Sachs's analyses. Representatives of the financial advisors reviewed their updated financial analyses of HSNi and the potential combination, along with recommendations for the Special Committee regarding the optimal response to Liberty Interactive in order to maximize HSNi stockholder value. The Special Committee then discussed the proposed timeline and sequencing for the due diligence requested by Liberty Interactive. The Special Committee discussed the merits of conditioning a transaction with Liberty Interactive on the consummation of Liberty Interactive's proposed transaction with GCI, but concluded that such a condition was not in the best interests of the HSNi stockholders. Following discussions, the Special Committee directed representatives of the financial advisors to contact Liberty Interactive to discuss the assumptions underlying the proposal and the Special Committee's belief that the transaction should be based on a fixed exchange ratio so that the HSNi stockholders would be able to participate in any increase in the Liberty QVCA common stock price attributable to the combination. Representatives of Centerview Partners and Goldman Sachs delivered this message to Mr. Maffei on May 16, 2017.

        On May 18, 2017, Liberty Interactive confidentially provided HSNi with a revised preliminary, non-binding proposal to acquire 100% of HSNi in an all-stock transaction for a fixed exchange ratio of 1.735 shares of Liberty QVCA common stock per share of HSNi common stock (representing a premium of approximately 20% to the closing price of HSNi common stock as of May 18, 2017). The proposal indicated that it was subject to a number of contingencies, including HSNi generating financial results not below that of current Wall Street consensus estimates for revenue and earnings before interest, tax, depreciation and amortization (which is sometimes referred to herein as EBITDA ) for the second quarter of 2017, as well as the satisfactory completion of business, legal, tax and accounting diligence.

        On May 19, 2017, members of the Special Committee held an update call with representatives from Centerview Partners and Goldman Sachs regarding Liberty Interactive's May 18 proposal.

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Representatives of the financial advisors reviewed the changes reflected in Liberty Interactive's May 18 proposal, including the fixed (rather than floating) exchange ratio, as well as HSNi management's earnings expectations for the second quarter of 2017 relative to the current Wall Street consensus estimates. Representatives of the financial advisors advised the Special Committee that they believed Liberty Interactive would be able to further increase the exchange ratio.

        On May 23, 2017, the Liberty Interactive board held a meeting regarding the current status of negotiations with HSNi. Senior management of Liberty Interactive attended the meeting.

        On May 24, 2017, the HSNi board held its regular quarterly meeting. Representatives of Davis Polk, Centerview Partners, Goldman Sachs and members of HSNi management joined for a portion of the meeting in order to update the members of the HSNi board on the terms of Liberty Interactive's May 10 and May 18 proposals and the discussions they had with Mr. Maffei regarding these proposals. Ms. Chun and Mr. Costello recused themselves from this portion of the meeting. The HSNi board discussed the contingency included in the May 18 proposal regarding HSNi's second quarter results and the market's likely reaction to the proposal and HSNi's alternatives if it were to reject Liberty Interactive's proposal. Representatives of the financial advisors also informed the Qualified Directors that Liberty Interactive had made clear that it was not interested in selling its approximately 38.2% ownership position in HSNi or supporting any such alternative transaction. Representatives of the financial advisors then reviewed HSNi's stand-alone plan, noting the challenging landscape for HSNi relative to QVC and the retail industry as a whole. Representatives of the financial advisors updated the Qualified Directors on their preliminary financial analysis of HSNi and a potential combination. The Qualified Directors discussed the risks inherent in HSNi's stand-alone plan, including the fact that HSNi was operating without a CEO and that QVC had been performing better relative to HSNi. Representatives of Davis Polk then reviewed with the Qualified Directors their fiduciary duties in connection with their consideration of the proposal.

        The Qualified Directors also discussed the possibility, and risks, of conducting a broad sale process pre-signing in light of Liberty Interactive's unwillingness to sell its HSNi shares or support an alternative transaction, and representatives of the financial advisors advised that outreach to other potential buyers would likely be futile in those circumstances. Members of HSNi management were then excused from the meeting and the Qualified Directors and representatives of Davis Polk, Centerview Partners and Goldman Sachs continued to discuss Liberty Interactive's proposals and the Special Committee's optimal response. Representatives of the financial advisors stated that they believed there might be additional value that Liberty Interactive would be willing to offer, but that in their view Liberty Interactive was likely nearing its maximum offer price. Additionally, representatives of the financial advisors noted that Liberty Interactive would be aware before signing that HSNi was unlikely to meet Wall Street consensus estimates, as required by Liberty Interactive's May 18 proposal, as a result of normal due diligence. Representatives of Davis Polk reviewed the key contractual terms for the Qualified Directors to consider in the context of any eventual merger agreement, including the possibility of conditioning the transaction on the approval by a majority of HSNi's non-Liberty Interactive stockholders. The Qualified Directors also discussed the possibility that rejecting Liberty Interactive's May 18 proposal would cause Liberty Interactive to terminate discussions with HSNi regarding the potential transaction. Following discussion, the Special Committee instructed representatives of Centerview Partners and Goldman Sachs to inform Mr. Maffei that HSNi was reviewing Liberty Interactive's latest proposal and planned to respond the following day.

        On May 25, 2017, the Special Committee held a telephonic meeting to further discuss Liberty Interactive's May 18 proposal and to formulate an appropriate response. Representatives of Davis Polk, Centerview Partners and Goldman Sachs participated in the meeting. The Special Committee discussed various aspects of the response and determined that it was advisable and in the best interests of the HSNi stockholders to propose a fixed exchange ratio of 1.790 shares of Liberty QVCA common stock for each share of HSNi common stock, which was in line with the six-month average exchange ratio

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between Liberty QVCA common stock and HSNi common stock-based on market prices and a premium of approximately 21% to the closing price of HSNi common stock as of May 25, 2017, and to make clear that HSNi expected to continue paying its regular, quarterly cash dividend of $0.35 per share during the period between signing of any merger agreement and the closing of the transaction. The Special Committee determined that the response should emphasize the importance of negotiating and executing definitive documentation on an expedited basis and ensuring that, once announced, Liberty Interactive's ability to abandon the transaction is limited, and accordingly, that the contingency relating to HSNi's second quarter performance should be removed. The Special Committee determined that Mr. Martinez would contact Mr. Maffei to convey the Special Committee's response regarding the principal economic points and representatives of the financial advisors would follow-up with the Special Committee's response on the other material terms and conditions.

        Later on May 25, 2017, Mr. Martinez called Mr. Maffei to respond to Liberty Interactive's May 18 proposal as directed by the Special Committee. Mr. Maffei informed Mr. Martinez that he was not inclined to increase the exchange ratio but would consider these points and discuss further.

        On May 26, 2017, Mr. Maffei called a representative of Goldman Sachs to request support for HSNi's assertion that an exchange ratio of 1.790 shares of Liberty QVCA common stock for each share of HSNi common stock better reflected an approximate 50/50 sharing of the expected synergies, as compared to Liberty Interactive's proposed exchange ratio of 1.735.

        Later on May 26, 2017, the Special Committee held a telephonic meeting. Representatives of Davis Polk, Centerview Partners and Goldman Sachs participated in the meeting. Mr. Martinez updated the Special Committee regarding his May 25, 2017 discussion with Mr. Maffei. Representatives of the financial advisors reviewed HSNi management's estimates of potential cost and revenue synergies that might result from a transaction and described to the Special Committee Mr. Maffei's call to a representative of Goldman Sachs earlier that day and Mr. Maffei's request for HSNi's synergy analysis. Following discussion, the Special Committee determined that it was advisable and in the best interests of the HSNi stockholders to share its synergy analysis if Liberty Interactive agreed to provide its own and to keep the information confidential subject to a customary confidentiality agreement to be negotiated by HSNi and Liberty Interactive in due course.

        Also on May 26, 2017, following receipt of confirmation from representatives of Liberty Interactive that Liberty Interactive would provide its own synergy analysis and would keep HSNi's analysis confidential, HSNi sent Liberty Interactive its synergy analysis.

        On May 30, 2017, Liberty Interactive sent the Special Committee its synergy analysis.

        On May 31, 2017, members of the Special Committee held a telephonic meeting with representatives of Davis Polk, Centerview Partners and Goldman Sachs as well as Mr. Little and Mr. Michael J. Attinella, Chief Accounting Officer of HSNi, to review the synergy analysis provided by Liberty Interactive on May 30, 2017.

        Later on May 31, 2017, members of HSNi management, Centerview Partners and Goldman Sachs held a conference call with representatives of Liberty Interactive, including representatives of QVC, to review each party's analysis of the potential synergies resulting from the proposed transaction.

        On June 1, 2017, Liberty Interactive informed representatives of Centerview Partners and Goldman Sachs that Liberty Interactive may be willing increase the fixed exchange ratio to 1.750 shares of Liberty QVCA common stock per share of HSNi common stock (representing a premium of approximately 27% to the closing price of HSNi common stock as of June 1, 2017), subject to the same contingencies discussed in its earlier non-binding proposals).

        On June 2, 2017, the Special Committee held a telephonic meeting regarding the June 1, 2017 non-binding proposal received from Liberty Interactive. Representatives of Davis Polk, Centerview

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Partners and Goldman Sachs participated in the meeting. The advisors and the Special Committee discussed various components of the proposal and representatives of Centerview Partners and Goldman Sachs advised the Special Committee that they believed that it was unlikely Liberty Interactive would agree to any further increase to the exchange ratio. Mr. Martinez informed the Special Committee that, earlier that day, Mr. Little had informed him that he expected HSNi's second quarter revenue to be below current Wall Street consensus estimates. Following discussion, the Special Committee determined that it was advisable and in the best interests of the HSNi stockholders to continue negotiating with Liberty Interactive on the basis of a 1.750 exchange ratio, subject to Liberty Interactive agreeing to permit HSNi to continue paying its regular quarterly cash dividend and to certain other terms intended to provide increased closing certainty. The Special Committee directed representatives of the financial advisors to deliver their response to Liberty Interactive and to inform Liberty Interactive that the Special Committee was prepared to recommend that the HSNi board approve the proposal subject to these other terms. The Special Committee also directed representatives of the financial advisors to arrange a call between HSNi and Liberty Interactive regarding the companies' second quarter performance, which would occur prior to any further information regarding HSNi being provided, so that Liberty Interactive could confirm their proposal in light of that information. The Special Committee also directed representatives of Davis Polk to send a confidentiality agreement to Liberty Interactive's counsel. The Special Committee then discussed whether Liberty Interactive should be required to agree to a standstill provision in the confidentiality agreement. Following discussion, the Special Committee determined that a standstill provision was not necessary in this context due to Liberty Interactive's approximately 38.2% interest in HSNi, the existing restrictions on Liberty Interactive acquiring additional shares of HSNi common stock under the terms of the Spinco Agreement between HSNi and Liberty Interactive (which is described in more detail in the section entitled "Certain Relationships and Related Party Transactions—Relationship Between HSNi and Liberty Interactive—Spinco Agreement") and the likelihood that requesting a standstill provision could lead to Liberty Interactive withdrawing its proposal and terminating discussions.

        Also on June 2, 2017, Davis Polk sent a draft mutual confidentiality agreement to Baker Botts L.L.P. ( Baker Botts ), legal counsel to Liberty Interactive. On June 4 and June 5, 2017, Baker Botts and Davis Polk exchanged revised drafts of the confidentiality agreement.

        On June 5, 2017, Liberty Interactive and HSNi executed the confidentiality agreement.

        On June 6, 2017, Mr. Maffei called a representative of Goldman Sachs to coordinate the process for HSNi and Liberty Interactive to conduct due diligence on one another.

        On June 8, 2017, members of HSNi management, Centerview Partners and Goldman Sachs held a conference call with representatives of Liberty Interactive to review HSNi's results for the month of April, draft results for the month of May and expected results for the month of June as well as the expected consolidated results for the second quarter of fiscal year 2017. Mr. Little also spoke about the observed industry trends impacting the business.

        Also on June 8, 2017, representatives of Liberty Interactive, including QVC, held a telephonic meeting with representatives of HSNi and the financial advisors to review HSNi's second quarter outlook.

        On June 9, 2017, Mr. Maffei called a representative of Goldman Sachs to inform him that, due to the deterioration in HSNi's business reflected in its second quarter revenue estimates, Liberty Interactive was reducing its proposed exchange ratio to 1.600 shares of Liberty QVCA common stock per share of HSNi common stock (representing a premium of approximately 18% to the closing price of HSNi common stock as of June 9, 2017), and that its current proposal otherwise remained subject to the same contingencies discussed in its earlier proposals. The representative of Goldman Sachs informed the Special Committee of the proposed reduction in the exchange ratio.

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        On June 12, 2017, Mr. Maffei contacted a representative of Goldman Sachs for an update on HSNi's review of the proposed transaction. The representative of Goldman Sachs informed Mr. Maffei that he did not have a formal response yet from the Special Committee, but the reduced price had not been well received by members of the Special Committee. Mr. Maffei informed the representative of Goldman Sachs that Liberty Interactive was willing to delay the transaction until after second quarter earnings were announced.

        Also on June 12, 2017, the Special Committee held a telephonic meeting with representatives of Davis Polk, Centerview Partners and Goldman Sachs to discuss the proposed reduction in the exchange ratio. A representative of Goldman Sachs relayed to the Special Committee his earlier discussion with Mr. Maffei, including Mr. Maffei's suggestion that they delay future discussion until after second quarter earnings were announced. Mr. Little then reviewed with the Special Committee HSNi's current outlook for the second quarter and the next 18 months. The Special Committee then discussed the comparative challenges facing the HSNi business and the QVC business. The Special Committee agreed to reconvene after it had a chance to review the forthcoming draft of the merger agreement in order to discuss the appropriate response.

        Later on June 12, 2017, Baker Botts delivered to Davis Polk an initial draft of the merger agreement.

        On June 13, 2017, Mr. Maffei called a representative of Goldman Sachs to discuss the initial draft of the merger agreement. The representative of Goldman Sachs informed Mr. Maffei that the draft omitted certain significant considerations that were important to the Special Committee, including the ability for HSNi to continue paying its regular quarterly cash dividend of up to $0.35 per share, a requirement that the transaction be conditioned on approval by a majority of HSNi's non-Liberty Interactive stockholders and a meaningful undertaking on Liberty Interactive's part to take the actions necessary to obtain regulatory approval. Mr. Maffei agreed that HSNi would be permitted to continue paying its regular quarterly dividend of up to $0.35 per share of HSNi common stock and to provide HSNi reasonable flexibility to hire and retain personnel during the period between signing and closing. He also informed the representative of Goldman Sachs that Liberty Interactive was not willing to agree to specific undertakings in order to obtain regulatory approval, that Liberty Interactive was unwilling to condition the transaction on the approval of a majority of the non-Liberty Interactive stockholders and that it was important to Liberty Interactive that HSNi not be permitted to terminate the agreement in order to enter into an agreement with a third party providing for a superior proposal unless and until HSNi stockholders voted against the proposed transaction.

        Also on June 13, 2017, the Special Committee held a telephonic meeting regarding Liberty Interactive's latest June 9, 2017 proposal regarding the reduced exchange ratio. Representatives of Davis Polk, Centerview Partners and Goldman Sachs participated in the meeting. Representatives of Davis Polk reviewed with the Special Committee the key provisions and principal issues raised by Liberty Interactive's initial draft of the merger agreement. A representative of Goldman Sachs then relayed to the Special Committee his earlier discussion with Mr. Maffei regarding certain of those provisions. The Special Committee discussed the proposal and the value it offered the HSNi stockholders compared to the value the HSNi stockholders would receive if HSNi remained a stand-alone company, as well as the availability of other strategic alternatives, taking into account Liberty Interactive's previously stated position that it would not be interested in selling its approximately 38.2% stake or supporting an alternative transaction. Following discussion, the Special Committee determined that it was advisable and in the best interests of the HSNi stockholders to propose a fixed exchange ratio of 1.700 shares of Liberty QVCA common stock per share of HSNi common stock (representing a premium of approximately 28% to the closing price of HSNi common stock as of June 13, 2017). The Special Committee directed representatives of the financial advisors to deliver their response to Liberty Interactive and to inform Liberty Interactive that the Special Committee was prepared to recommend

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that HSNi's board approve the proposal at that price subject to certain other conditions, including an expedited timeline to signing.

        On June 14, 2017, a representative of Goldman Sachs delivered to Mr. Maffei the Special Committee's response. Mr. Maffei informed the representative of Goldman Sachs that Liberty Interactive may be willing to increase the exchange ratio to 1.650 shares of Liberty QVCA common stock per share of HSNi common stock and expected to be in a position to execute the definitive agreement within two weeks (subject to the completion of ongoing due diligence, among other contingencies), but Liberty Interactive was not willing to condition the transaction on the approval of the non-Liberty Interactive shareholders.

        On June 15, 2017, the Special Committee held a telephonic meeting with representatives of Davis Polk, Goldman Sachs and Centerview Partners. A representative of Goldman Sachs informed the Special Committee that he had relayed the Special Committee's response to Mr. Maffei as well as Mr. Maffei's latest proposal that was discussed the previous evening. In response, representatives of Goldman Sachs said that Liberty Interactive may be willing to increase the exchange ratio to 1.650 shares of Liberty QVCA common stock per share of HSNi common stock (representing a premium of approximately 25% to the closing price of HSNi common stock as of June 14, 2017), and expected to be in a position to execute the definitive agreement within two weeks, but Liberty Interactive was not willing to condition the transaction on the approval of a majority of the non-Liberty Interactive HSNi stockholders and that the increased exchange ratio remained subject to certain contingencies, including ongoing due diligence. Representatives of Centerview Partners and Goldman Sachs advised the Special Committee that in their view, Liberty Interactive was unlikely to further increase the exchange ratio. Representatives of Davis Polk reviewed with the Special Committee various issues relating to removing the condition that the transaction be approved by a majority of HSNi's non-Liberty Interactive stockholders. Following discussion, the Special Committee agreed to proceed without that condition.

        On June 16, 2017, HSNi provided access to a virtual dataroom to Liberty Interactive and its advisors, in response to diligence requests previously sent by Liberty Interactive and its advisors. From June 16, 2017, and on a continuing basis up until the date the merger agreement was executed, both Liberty Interactive and HSNi, along with their respective advisors, conducted business, legal and financial due diligence regarding their respective business operations, including engaging in due diligence calls and meetings on various topics.

        Also on June 16, 2017, Davis Polk delivered to Baker Botts a revised draft of the merger agreement. From June 16, 2017 until the execution of the merger agreement on July 5, 2017, the parties and their respective legal and financial advisors exchanged numerous drafts of, and engaged in numerous discussions and negotiations concerning the terms of, the merger agreement and related disclosure schedules and exhibits. Significant areas of discussion and negotiation included Liberty Interactive's obligation to take meaningful action as might be necessary to obtain the required regulatory approvals and the associated reverse termination fee payable by Liberty Interactive in the event the transaction did not close due to the failure to obtain any of the required regulatory approvals, HSNi's obligation to cooperate with Liberty Interactive's financing activities and the associated condition to closing relating to Liberty Interactive's financing, the "no-shop" provisions and the circumstances in which (i) either party would be permitted to terminate the merger agreement in response to the HSNi board changing its recommendation with respect to the transaction, (ii) HSNi would be permitted to terminate the merger agreement in order to enter into an agreement with a third party and (iii) a fee would be payable by HSNi in connection therewith, and various employee-related matters. Documentary and other due diligence by both parties also continued in parallel with the negotiation of the merger agreement and the overall transaction.

        On June 20, 2017 and June 21, 2017, representatives of the financial advisors met with representatives of HSNi and Liberty Interactive, including QVC, to discuss the proposed transaction

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and conduct due diligence, including on the potential synergies that could result from a potential transaction. Representatives of Liberty Interactive also discussed the QVC Group's expected results for the second quarter of 2017 and provided their updated outlook for full fiscal years 2017 and 2018.

        Also on June 21, 2017, Liberty Interactive formally engaged Allen & Company LLC ( Allen & Co. ) to act as its financial advisor with respect to the potential transaction with HSNi. From time to time during the negotiations described above and below (including prior to their official engagement), representatives of Allen & Co. provided strategic advice to senior management of Liberty Interactive with respect to the potential transaction with HSNi. However, Allen & Co. was not asked to provide, and did not provide, a fairness opinion to Liberty Interactive regarding the transaction.

        On June 22, 2017, the Qualified Directors held a telephonic meeting. Representatives of Davis Polk, Centerview Partners and Goldman Sachs as well as Mr. Little participated in the meeting. Mr. Little reviewed HSNi management's financial outlook for the second quarter of 2017 as well as its updated outlook for the full fiscal year 2017. Representatives of the financial advisors then provided a review of Liberty Interactive's latest proposal and an update on the process and the diligence meetings that were held on June 20, 2017. Representatives of Davis Polk reviewed with the Qualified Directors key terms and principal issues raised by the latest draft of the merger agreement.

        On June 23, 2017, the Special Committee held a telephonic meeting. Representatives of Davis Polk, Centerview Partners and Goldman Sachs participated in the meeting. The advisors and the Special Committee discussed various topics from the Qualified Directors meeting that occurred the prior day, along with next steps regarding the proposed transaction. The Special Committee discussed the potential antitrust implications for the proposed transaction and various methods of incentivizing Liberty Interactive to take appropriate action in order to obtain the required regulatory approvals and to compensate the HSNi stockholders in the event any of the regulatory approvals are not obtained. The Special Committee also discussed the conditions to closing of the transaction. The Special Committee directed representatives of Davis Polk on how to respond to these issues and the other material terms, and to revise the merger agreement accordingly. The Special Committee directed representatives of the financial advisors to arrange a call with Mr. Maffei after representatives of Davis Polk delivered a revised draft of the merger agreement to Baker Botts in order to discuss the timeline and process for due diligence, particularly in light of the amount of information that had been requested by Liberty Interactive and the resources HSNi was expending to satisfy those requests.

        Also on June 23, 2017, Liberty Interactive provided access to a virtual dataroom to HSNi and its advisors, in response to diligence requests previously sent by HSNi and its advisors.

        On June 26, 2017, the Special Committee held a telephonic meeting. Representatives of Davis Polk, Centerview Partners and Goldman Sachs participated in the meeting. Representatives of the financial advisors informed the Special Committee that Mr. Maffei indicated that further progress needed to be made with regard to certain due diligence items and certain provisions of the merger agreement before a final agreement could be reached. Mr. Little reviewed with the Special Committee the unaudited forecasted financial information prepared by QVC management and HSNi management's proposed adjustments to that unaudited forecasted financial information. Following discussion, the Special Committee determined that the unaudited forecasted financial information, as adjusted by HSNi management, was fair and based on reasonable assumptions, and approved it for use by the financial advisors in connection with their analyses.

        On June 28, 2017, Mr. Maffei called a representative of Goldman Sachs to discuss the remaining open items in the merger agreement and the due diligence process. Mr. Maffei indicated to the representative of Goldman Sachs that Liberty Interactive believed it was reasonable to target a public announcement of a potential transaction on July 6, 2017, subject to the satisfactory resolution of the outstanding material issues and completion of due diligence.

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        Also on June 28, 2017, the Special Committee held a telephonic meeting. Representatives of Davis Polk, Centerview Partners and Goldman Sachs participated in the meeting. At the Special Committee's request, representatives of Davis Polk reviewed with the Special Committee the material open issues in the merger agreement, including HSNi's right to terminate the merger agreement in order to enter into an agreement with a third party providing for a superior transaction proposal (as defined in the "—The Merger Agreement—No Solicitation" section) subject to payment of a customary termination fee, the inclusion of a closing condition relating to Liberty Interactive's financing and certain employee-related matters. Representatives of Davis Polk informed the Special Committee that Liberty Interactive had agreed to the inclusion of a reverse termination break-up fee in the event the transaction did not close due to the failure to obtain the required regulatory approvals but that the amount of the fee was still subject to negotiation.

        On June 29, 2017, representatives of Liberty Interactive, including QVC, and HSNi as well as representatives of the financial advisors held a series of in-person due diligence meetings in Tampa, Florida.

        On June 30, 2017, the Special Committee held a telephonic meeting. Representatives of Davis Polk, Centerview Partners and Goldman Sachs participated in the meeting. Representatives of Davis Polk reviewed with the Special Committee the material open issues in the merger agreement. Following discussion, the Special Committee directed representatives of Davis Polk on how to respond to these issues and the other material terms, and to revise the merger agreement accordingly.

        On July 2, 2017, representatives of Centerview Partners and Goldman Sachs spoke with Mr. Maffei regarding the remaining open issues in the merger agreement. Mr. Maffei agreed to allow HSNi to terminate the merger agreement in order to enter into an agreement with a third party providing for a superior transaction proposal, subject to payment of a $40 million termination fee. Mr. Maffei and the representatives of Centerview Partners and Goldman Sachs discussed certain employee related matters, including HSNi's ability to continue the search for a new CEO and the treatment of outstanding equity awards with respect to shares of HSNi common stock. Mr. Maffei also agreed that HSNi would have a consent right with respect to certain material changes to Liberty Interactive's proposed transaction with GCI, subject to continuing discussion regarding the appropriate parameters of such consent right.

        On July 4, 2017, Mr. Little requested the Special Committee's approval of the unaudited forecasted financial information for HSNi on a stand-alone basis, the unaudited forecasted financial information for the QVC Group on a stand-alone basis prepared by the management of HSNi (based on forecasts that were initially prepared by the management of Liberty Interactive) and the unaudited forecasted financial information for the QVC Group pro forma for the merger prepared by the management of HSNi. Mr. Little noted that the financial information for HSNi stand-alone upon which the unaudited forecasted financial information for HSNi stand-alone and the QVC Group pro forma for the merger was based reflected the updated outlook for the fiscal year ending 2017, as discussed with the Qualified Directors on June 22, 2017, and, for the fiscal years ending 2018 through 2021, reflected the projections previously approved by the Special Committee on January 30, 2017. The Special Committee determined that the unaudited forecasted financial information for HSNi stand-alone and for the QVC Group pro forma for the merger were fair and based on reasonable assumptions, and approved them for use by the financial advisors in connection with their analyses.

        Also on July 4, 2017, the Special Committee held a telephonic meeting. Representatives of Davis Polk, Centerview Partners and Goldman Sachs participated in the meeting. Representatives of Davis Polk discussed certain unresolved issues in connection with the merger agreement. The Special Committee concluded that a $75 million reverse termination break-up fee was sufficient to incentivize Liberty Interactive to take appropriate actions to obtain the required regulatory approvals. Following discussion, the Special Committee directed representatives of Davis Polk on how to respond to these issues and the other material terms.

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        On July 5, 2017, after the markets were closed, the Special Committee and other Qualified Directors held a meeting for the purpose of considering the proposed transaction with Liberty Interactive, with representatives of Davis Polk, Centerview Partners and Goldman Sachs in attendance at the meeting. Mr. Martinez reviewed with the Qualified Directors the proposal from Liberty Interactive to acquire HSNi for a fixed exchange ratio of 1.650 shares of Liberty QVCA common stock per share of HSNi common stock. Mr. Martinez informed the Qualified Directors that the remaining issues were being discussed between Davis Polk and Baker Botts with the intention to have them resolved in the next few hours. Without representatives of Centerview Partners or Goldman Sachs present, the Qualified Directors and representatives of Davis Polk discussed the fiduciary duties of the Qualified Directors in connection with the proposed transaction. The Special Committee then reviewed the updated relationship disclosures provided by each financial advisor to supplement the questionnaires provided to the Special Committee prior to its January 5, 2017 meeting, and reflecting matters arising since that time. The Special Committee determined that it did not believe that either Centerview Partners or Goldman Sachs had any actual or potential conflict of interest that would impair either firm's ability to provide independent advice to the Qualified Directors and the Special Committee. Thereafter, at the request of the Special Committee, Centerview Partners and Goldman Sachs joined the meeting and delivered a presentation to the Special Committee and the other Qualified Directors with respect to the financial terms of the proposed transaction with Liberty Interactive. Representatives of the financial advisors and the Qualified Directors had a detailed discussion of the unaudited forecasted financial information for QVC prepared by the management of HSNi (based on forecasts that were initially prepared by the management of Liberty Interactive), and the unaudited forecasted financial information for HSNi prepared by HSNi management, used for the financial analyses. Representatives of the financial advisors then reviewed their separate financial analyses of Liberty Interactive's proposal to acquire HSNi for 1.650 shares of Liberty QVCA common stock per share of HSNi common stock (representing a premium of approximately 29% to the closing price of HSNi common stock as of July 5, 2017). Centerview Partners rendered to the Special Committee (with the other Qualified Directors present) an oral opinion, which was subsequently confirmed by delivery of a written opinion dated July 5, 2017, that, as of such date and based upon and subject to the assumptions made, procedures followed, matters considered, and qualifications and limitations upon the review undertaken by Centerview Partners in preparing its opinion, the consideration to be paid by Liberty Interactive to the holders of shares of HSNi common stock (other than as specified in such opinion) pursuant to the merger agreement was fair, from a financial point of view, to such holders. For a detailed discussion of Centerview Partners' opinion, please see "—Opinion of the Special Committee Financial Advisors (Centerview Partners)." Goldman Sachs rendered to the Special Committee (with the other Qualified Directors present) an oral opinion, which was subsequently confirmed by delivery of a written opinion dated July 5, 2017, that, as of such date and based upon and subject to the factors and assumptions set forth therein the consideration to be paid by Liberty Interactive for each share of HSNi common stock pursuant to the merger agreement was fair, from a financial point of view, to the holders (other than the Liberty Interactive related entities) of shares of HSNi common stock. For a detailed discussion of Goldman Sachs' opinion, please see "—Opinion of the Special Committee Financial Advisors (Goldman Sachs)." Representatives of Davis Polk provided the Special Committee and the other Qualified Directors with a summary of the key terms in the merger agreement. The Special Committee and the other Qualified Directors adjourned the meeting and reconvened later that night, at which time representatives of Davis Polk informed the Special Committee and the other Qualified Directors that HSNi and Liberty Interactive had agreed to mutually acceptable resolutions regarding the remaining material issues. Representatives of Goldman Sachs and Centerview Partners informed the Special Committee and the other Qualified Directors that, in order to resolve certain concerns raised by Liberty Interactive about the aggregate transaction fees payable to Goldman Sachs and Centerview Partners by HSNi under their respective engagement letters in light of Liberty Interactive's existing significant equity interest in HSNi, Goldman Sachs and Centerview Partners had orally advised Liberty Interactive that, to the extent they were engaged in the

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future to provide investment banking advisory services to Liberty Interactive or certain entities controlled by Liberty Interactive, each would provide, depending on the circumstances, a credit toward such engagement. After discussion, the Special Committee and the other Qualified Directors determined that all open material issues had been resolved in a manner satisfactory to the Special Committee and the other Qualified Directors and in the best interests of the HSNi stockholders. The Special Committee unanimously recommended that the Qualified Directors (i) determine the merger agreement and the transactions contemplated thereby, including the merger, are advisable and fair to, and in the best interests of, HSNi and the HSNi stockholders, (ii) approve and declare advisable the merger agreement and the transactions contemplated thereby, including the merger and (iii) direct that the merger agreement be submitted to the HSNi stockholders for adoption. On the recommendation of the Special Committee, the Qualified Directors (i) determined the merger agreement and the transactions contemplated thereby, including the merger, are advisable and fair to, and in the best interests of, HSNi and the HSNi stockholders, (ii) approved and declared advisable the merger agreement and the transactions contemplated thereby, including the merger, (iii) resolved to recommend that the HSNi stockholders approve the adoption of the merger agreement and (iv) directed that the merger agreement be submitted to the HSNi stockholders for adoption. The Qualified Directors also approved a one-time payment of $50,000 to each member of the Special Committee (other than Mr. Martinez, who at the time the Special Committee was formed declined to receive any payment), and agreed to reimburse the reasonable out-of-pocket expenses of each member of the Special Committee in connection with each member's service on the Special Committee.

        Also on July 5, 2017, the Liberty Interactive board held a telephonic meeting to discuss and review the terms of the transaction. Following a discussion in which representatives of Baker Botts and senior management of Liberty Interactive participated, the Liberty Interactive board unanimously (i) determined that the merger agreement and the transactions contemplated thereby, including the merger, are advisable and fair to, and in the best interests of, Liberty Interactive and its stockholders, and (ii) approved and declared advisable the merger agreement and the transactions contemplated thereby, including the merger.

        The merger agreement was executed and delivered, as of July 5, 2017, by Liberty Interactive, Merger Sub and HSNi.

        On July 6, 2017, before the markets opened, Liberty Interactive and HSNi announced that they had entered into the merger agreement.

Liberty Interactive's Purpose and Reasons for the Merger

        The Liberty Interactive board has determined that the merger agreement and the transactions contemplated thereby, including the merger, are advisable and in the best interests of Liberty Interactive and its stockholders. In reaching this conclusion, the Liberty Interactive board consulted with Liberty Interactive's management and its legal and financial advisors, and considered a variety of factors, including the material factors described below.

        In reaching its conclusion that the merger agreement and the transactions contemplated thereby, including the merger, are advisable and in the best interest of Liberty Interactive and its stockholders, the Liberty Interactive board considered a number of factors that it believes support its determination, including (not necessarily in order of importance):

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        The Liberty Interactive board also considered a number of uncertainties, risks and other potentially negative factors in its deliberations concerning the merger agreement and the transactions

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contemplated thereby, including the merger. These factors include (not necessarily in order of importance):

        After considering the positive and negative factors described above, the Liberty Interactive board determined that the anticipated benefits of the merger outweighed the risks and costs and approved the merger agreement and the transactions contemplated thereby, including the merger.

        The foregoing discussion summarizes the material information and factors considered by the Liberty Interactive board in its consideration of the merger agreement and the transactions contemplated thereby, including the merger. The Liberty Interactive board reached the unanimous decision to approve the merger agreement and the merger in light of the factors described above and other factors that each member of the Liberty Interactive board felt were appropriate. In view of the variety of factors and the quality and amount of information considered, the Liberty Interactive board did not find it practicable to, and did not, make specific assessments of, quantify or otherwise assign relative weights to the specific factors considered in reaching its determination. Individual members of the Liberty Interactive board may have given different weights to different factors.

        The explanation of Liberty Interactive's reasons for the merger agreement and the merger, and other information presented in this section is forward-looking in nature and, accordingly, should be read in light of the factors described under "Risk Factors" and "Cautionary Statement Concerning Forward-Looking Statements" above.

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HSNi's Purpose and Reasons for the Merger and Other Proposals; Recommendations of the Special Committee and HSNi Board; Fairness of the Merger

        The HSNi board recommends that the HSNi stockholders vote " FOR " the merger agreement proposal.

        The HSNi board established the Special Committee to negotiate the terms of the merger on behalf of its unaffiliated stockholders with the assistance of independent legal and financial advisors. In reaching the decision to recommend to the HSNi board the approval of the merger agreement, the merger and the transactions contemplated by the merger agreement and to recommend that the HSNi stockholders vote to approve the adoption of the merger agreement, the Special Committee consulted extensively with its financial and legal advisors and HSNi management, and considered other potential strategic alternatives. After such discussions and considering such alternatives, the Special Committee unanimously determined the proposed merger to be advisable, fair to and in the best interests of, HSNi and the HSNi stockholders.

        In reaching its decision to recommend that the HSNi stockholders vote to approve the adoption of the merger agreement, the merger and the transactions contemplated thereby, the HSNi board consulted extensively with the Special Committee and the Special Committee's financial and legal advisors and HSNi management, and considered other potential strategic alternatives. After such discussions and considering such alternatives, the HSNi board determined the proposed merger to be advisable, fair to and in the best interests of, HSNi and the HSNi stockholders.

        The Special Committee's recommendation and the HSNi board's decision to approve the merger agreement, the merger and the other transactions contemplated thereby and to recommend to the HSNi stockholders that they vote to approve the adoption of the merger agreement was based on a number of factors, including the following (which are not necessarily presented in order of relative importance):

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        The Special Committee and the HSNi board also considered the following specific aspects of the merger agreement (which are not necessarily presented in order of relative importance):

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        In the course of its deliberations, the Special Committee and the HSNi board also considered a variety of risks, uncertainties and other potentially negative factors, including the following (which are not necessarily presented in order of relative importance):

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        The Special Committee and the HSNi board considered all of these factors as a whole and concluded that they supported a determination that the proposed merger was advisable, fair to and in the best interests of, HSNi and the HSNi stockholders. The foregoing discussion of the information and factors considered by the Special Committee and the HSNi board is not exhaustive. In view of the wide variety of factors considered by the Special Committee and the HSNi board in connection with their evaluation of the merger and the complexity of these matters, the Special Committee and the HSNi board did not consider it practical to, nor did they attempt to, quantify, rank or otherwise assign relative weights to the specific factors that they considered in reaching their respective decisions. In considering the factors described above and any other factors, individual members of the Special Committee and the HSNi board may have viewed factors differently or given different weight or merit to different factors.

        In considering the recommendation of the HSNi board that the HSNi stockholders vote to approve the adoption of the merger agreement and the transactions contemplated thereby, HSNi stockholders should be aware that the executive officers and directors of HSNi may have certain interests in the

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merger that may be different from, or in addition to, the interests of HSNi stockholders generally. To avoid any actual conflict of interest or the appearance of any conflict of interest, the two individuals designated by Liberty Interactive to the HSNi board recused themselves from all discussions and presentations regarding the transactions contemplated by the merger agreement, including the merger. The HSNi board was aware of these interests and considered them when approving the merger agreement and recommending that HSNi stockholders vote to approve and adopt the merger agreement and the transactions contemplated thereby. See "Information About the Merger—Interests of Certain Persons of HSNi in the Merger."

        The foregoing discussion of the information and factors considered by the Special Committee is forward-looking in nature. This information should be read in light of the factors described in the section entitled "Cautionary Statement Concerning Forward-Looking Statements."

Unaudited Forecasted Financial Information

        Liberty Interactive prepared unaudited forecasted financial information for the years 2017 through 2021 for the QVC Group on a stand-alone basis. HSNi prepared unaudited forecasted financial information for the years 2017 through 2021 for HSNi on a stand-alone basis and, using unaudited forecasted financial information provided by Liberty Interactive for the QVC Group, prepared unaudited forecasted financial information for the years 2017 through 2021 for the QVC Group on a standalone basis. The unaudited forecasted financial information does not give effect to the merger. The unaudited forecasted financial information was prepared separately by each of the companies using, in some cases, different assumptions, and is not intended to be added together. Adding the unaudited forecasted financial information together for the two companies would not necessarily represent the results the combined company will achieve if the merger is completed and does not represent forecasted financial information for the combined company if the merger is completed.

        Neither Liberty Interactive nor HSNi, as a matter of course, makes public long-term projections as to future revenues, earnings or other results due to, among other reasons, the uncertainty of the underlying assumptions and estimates. However, the unaudited forecasted financial information set forth below was made available to the Special Committee, the HSNi board, Centerview Partners and/or Goldman Sachs in connection with the evaluation of the merger. The inclusion of this information should not be regarded as an indication that any of the Special Committee, HSNi, Centerview Partners, Goldman Sachs or any other recipient of this information considered, or now considers, it to be necessarily predictive of actual future results. Readers of this document are cautioned not to place undue reliance on the unaudited forecasted financial information.

        The unaudited forecasted financial information was, in general, prepared solely for internal use and is subjective in many respects. As a result, there can be no assurance that the forecasted results will be realized or that actual results will not be significantly higher or lower than estimated. Since the unaudited forecasted financial information covers multiple years, such information by its nature becomes less predictive with each successive year. The estimates and assumptions underlying the unaudited forecasted financial information involve judgments with respect to, among other things, future economic, competitive, regulatory and financial market conditions and future business decisions which may not be realized and that are inherently subject to significant uncertainties and contingencies, all of which are difficult to predict and many of which are beyond the control of Liberty Interactive and/or HSNi and will be beyond the control of the combined company. HSNi stockholders are urged to review the SEC filings of Liberty Interactive for a description of risk factors with respect to the business of Liberty Interactive and the SEC filings of HSNi for a description of risk factors with respect to the business of HSNi. See "Cautionary Statement Concerning Forward-Looking Statements" and "Additional Information—Where You Can Find More Information," respectively. HSNi stockholders are also urged to review the section entitled "Risk Factors." The unaudited forecasted financial information was not prepared with a view toward public disclosure, nor was it prepared with a view

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toward compliance with published guidelines of the SEC, the guidelines established by the American Institute of Certified Public Accountants for preparation and presentation of prospective financial information or GAAP (including because certain metrics are non-GAAP measures) but, in the view of HSNi's management was prepared on a reasonable basis, reflects the best currently available estimates and judgments, and presents, to the best of HSNi's management's knowledge and belief, the expected course of action and the expected future financial performance of the QVC Group and HSNi, as applicable. However, this information is not fact and should not be relied upon as being necessarily indicative of future results, and readers of this proxy statement/prospectus are cautioned not to place undue reliance on the unaudited forecasted financial information. Neither of the independent registered public accounting firms of Liberty Interactive or HSNi nor any other independent accountants, have compiled, examined, or performed any procedures with respect to the unaudited forecasted financial information contained herein, nor have they expressed any opinion or any other form of assurance on such information or its achievability. The report of the independent registered public accounting firm of Liberty Interactive contained in Liberty's Annual Report on Form 10-K for the year ended December 31, 2016 and the report of the independent registered public accounting firm of HSNi contained in HSNi's Annual Report on Form 10-K for the year ended December 31, 2016, both of which are incorporated by reference into this document, relate to the historical financial information of Liberty Interactive and HSNi, respectively. They do not extend to the unaudited forecasted financial information and should not be read to do so. Furthermore, the unaudited forecasted financial information does not take into account any circumstances or events occurring after the date they were prepared.

        NEITHER LIBERTY INTERACTIVE NOR HSNi INTEND TO UPDATE OR OTHERWISE REVISE THE UNAUDITED FORECASTED FINANCIAL INFORMATION TO REFLECT CIRCUMSTANCES EXISTING AFTER THE DATE WHEN MADE OR TO REFLECT THE OCCURRENCE OF FUTURE EVENTS, EVEN IN THE EVENT THAT ANY OR ALL OF THE ASSUMPTIONS UNDERLYING SUCH PROSPECTIVE FINANCIAL INFORMATION ARE NO LONGER APPROPRIATE, EXCEPT AS MAY BE REQUIRED BY LAW.

        The following table presents select unaudited forecasted financial information of HSNi for the fiscal years ending 2017 through 2021 prepared by HSNi management and provided to the Special Committee, the HSNi board, Centerview Partners, Goldman Sachs and, with the exception of

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(Increase)/Decrease in Net Working Capital and Unlevered Free Cash Flow, provided to Liberty Interactive, and is sometimes referred to as the HSNi unaudited forecasted financial information :

 
  Year Ended December 31,  
 
  2017E   2018E   2019E   2020E   2021E  
 
  amounts in millions, except per share amounts (a)
 

Income Statement Items

                               

Net Sales

  $ 3,515   $ 3,786   $ 3,946   $ 4,100   $ 4,257  

Gross Profit

  $ 1,206   $ 1,316   $ 1,383   $ 1,447   $ 1,513  

Adjusted EBITDA(b)

  $ 283   $ 346   $ 377   $ 408   $ 441  

Stock-Based Compensation

  $ (21 ) $ (22 ) $ (22 ) $ (23 ) $ (24 )

Comparable EBITDA(c)

  $ 262   $ 324   $ 354   $ 385   $ 417  

Depreciation and amortization

  $ 47   $ 49   $ 52   $ 56   $ 59  

Cash Flow Items

                               

(Increase)/Decrease in Net Working Capital

  $ (6 ) $ (31 ) $ (16 ) $ (14 ) $ (17 )

Capital Expenditures

  $ (59 ) $ (82 ) $ (84 ) $ (80 ) $ (73 )

Unlevered Free Cash Flow(d)

  $ 117   $ 109   $ 141   $ 168   $ 193  

(a)
Certain totals in the tables included in this proxy statement/prospectus may not sum due to rounding.

(b)
Adjusted EBITDA, which is calculated as consolidated net earnings before interest, income taxes, stock-based compensation expense and depreciation and amortization expense, is a non-GAAP financial measure as it excludes amounts included in net earnings, the most directly comparable measure calculated in accordance with GAAP. This measure should not be considered as an alternative to net earnings or other measures derived in accordance with GAAP.

(c)
Comparable EBITDA means Adjusted EBITDA less stock-based compensation expense.

(d)
Unlevered free cash flow means Comparable EBITDA (as defined in the immediately preceding footnote (c)), less unlevered cash taxes, less capital expenditures, less the increase in net working capital.

        The HSNi unaudited forecasted financial information is based on various assumptions, including the following principal assumptions:

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        The estimates and assumptions underlying the HSNi unaudited forecasted financial information are inherently uncertain and, though considered reasonable by the management of HSNi as of the date of the preparation of such unaudited forecasted financial information, are subject to a wide variety of significant business, economic, regulatory and competitive risks and uncertainties that could cause actual results to differ materially from those contained in the unaudited forecasted financial information, including, among other things, the matters described in the sections entitled "Cautionary Statement Concerning Forward-Looking Statements" and "Risk Factors," respectively. Accordingly, there can be no assurance that the forecasted results are indicative of the future performance of HSNi, or that actual results will not differ materially from those presented in the HSNi unaudited forecasted financial information.

        Inclusion of the HSNi unaudited forecasted financial information in this proxy statement/prospectus should not be regarded as a representation by any person that the results contained in the HSNi unaudited forecasted financial information will be achieved.

        The HSNi unaudited forecasted financial information is not included in this proxy statement/prospectus in order to induce any HSNi stockholder to vote in favor of any of the proposals at the HSNi special meeting.

        The following table presents select unaudited forecasted financial information of the QVC Group for the fiscal years ending 2017 through 2021 based on (i) Liberty Interactive management's outlook for the QVC Group for the fiscal years ending 2017 and 2018 as prepared in June 2017 and (ii) for the fiscal years ending 2019 through 2021, Liberty Interactive management's long-range plan for the QVC Group as prepared in January 2017. This information was provided to the Special Committee, the HSNi board, Centerview Partners and Goldman Sachs, and is sometimes referred to as the QVC Group standalone unaudited forecasted financial information .

 
  Year Ended December 31,  
 
  2017E   2018E   2019E   2020E   2021E  
 
  amounts in millions, except per share amounts (a)
 

Income Statement Items

                               

Revenue

  $ 10,350   $ 10,733   $ 11,554   $ 12,009   $ 12,673  

Adjusted EBITDA(b)

  $ 2,006   $ 2,083   $ 2,253   $ 2,389   $ 2,525  

(a)
Certain totals in the tables included in this proxy statement/prospectus may not sum due to rounding.

(b)
Adjusted EBITDA, which is calculated as consolidated net earnings before interest, income taxes, stock-based compensation expense and depreciation and amortization expense, is a non-GAAP financial measure as it excludes amounts included in net earnings, the most directly comparable measure calculated in accordance with GAAP. This measure should not be considered as an alternative to net earnings or other measures derived in accordance with GAAP.

        The following table presents select unaudited forecasted financial information of the QVC Group for the fiscal years ending 2017 through 2021 prepared by HSNi management and provided to the Special Committee, the HSNi board, Centerview Partners and Goldman Sachs, and is sometimes referred to as the QVC Group standalone adjusted unaudited forecasted financial information . Such

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QVC Group standalone adjusted unaudited forecasted financial information was prepared by HSNi management from the QVC Group standalone unaudited forecasted financial information.

 
  Year Ended December 31,  
 
  2017E   2018E   2019E   2020E   2021E  
 
  amounts in millions, except per share amounts (a)
 

Income Statement Items

                               

Revenue

  $ 10,321   $ 10,568   $ 10,882   $ 11,197   $ 11,533  

Gross Profit

  $ 3,458   $ 3,551   $ 3,667   $ 3,785   $ 3,910  

Adjusted EBITDA(b)

  $ 2,006   $ 2,042   $ 2,157   $ 2,269   $ 2,393  

Stock-Based Compensation

  $ (67 ) $ (69 ) $ (71 ) $ (73 ) $ (75 )

Comparable EBITDA(c)

  $ 1,939   $ 1,973   $ 2,086   $ 2,196   $ 2,318  

Depreciation and amortization(d)

  $ 721   $ 515   $ 456   $ 431   $ 434  

Transaction amortization

  $ 373   $ 150   $ 79   $ 54   $ 49  

Cash Flow Items

                               

(Increase)/Decrease in Net Working Capital

  $ (63 ) $ (36 ) $ (46 ) $ (41 ) $ (53 )

Capital Expenditures(e)

  $ (296 ) $ (301 ) $ (308 ) $ (314 ) $ (321 )

Unlevered Free Cash Flow(f)

  $ 999   $ 1,049   $ 1,109   $ 1,177   $ 1,239  

(a)
Certain totals in the tables included in this proxy statement/prospectus may not sum due to rounding.

(b)
Adjusted EBITDA, which is calculated as consolidated net earnings before interest, income taxes, stock-based compensation expense and depreciation and amortization expense, is a non-GAAP financial measure as it excludes amounts included in net earnings, the most directly comparable measure calculated in accordance with GAAP. This measure should not be considered as an alternative to net earnings or other measures derived in accordance with GAAP.

(c)
Comparable EBITDA means Adjusted EBITDA less stock-based compensation expense.

(d)
Includes transaction amortization, and it assumes transaction amortization is not tax deductible for cash tax purposes, per Liberty Interactive SEC filings.

(e)
This includes capitalized TV distribution fees of approximately $90 million per year.

(f)
Unlevered free cash flow means Comparable EBITDA (as defined in the preceding footnote (c)), less unlevered cash taxes, less capital expenditures (as described in the immediately preceding footnote (e)), less the increase in net working capital.

        The following table presents select unaudited forecasted financial information of the QVC Group pro forma for the merger for the fiscal years ending 2017 through 2021 prepared by HSNi management and provided to the Special Committee, the HSNi board, Centerview Partners and Goldman Sachs, and is sometimes referred to as the QVC Group pro forma adjusted unaudited forecasted financial information. Such QVC Group pro forma adjusted unaudited forecasted financial information was prepared by HSNi management from the HSNi unaudited forecasted financial information, the QVC

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Group standalone adjusted unaudited forecasted financial information and certain assumptions with regards to operating synergies and the cost to achieve such synergies.

 
  Year Ended December 31,  
 
  2017E   2018E   2019E   2020E   2021E  
 
  amounts in millions, except per share amounts(a)
 

Income Statement Items

                               

Revenue

  $ 13,837   $ 14,354   $ 14,828   $ 15,297   $ 15,791  

Adjusted EBITDA (Pre-Synergies)(b)          

  $ 2,290   $ 2,388   $ 2,534   $ 2,676   $ 2,834  

Stock-Based Compensation

  $ (88 ) $ (90 ) $ (93 ) $ (96 ) $ (99 )

Comparable EBITDA (Pre-Synergies)(c)

  $ 2,202   $ 2,297   $ 2,441   $ 2,581   $ 2,735  

Illustrative Net Synergies(d)

  $ 0   $ 16   $ 109   $ 125   $ 125  

Depreciation and amortization(e)

  $ 767   $ 564   $ 508   $ 486   $ 492  

Transaction amortization

  $ 373   $ 150   $ 79   $ 54   $ 49  

Cash Flow Items

                               

(Increase)/Decrease in Net Working Capital

  $ (69 ) $ (67 ) $ (62 ) $ (55 ) $ (71 )

Capital Expenditures(f)

  $ (355 ) $ (383 ) $ (392 ) $ (394 ) $ (393 )

Unlevered Free Cash Flow(g)

  $ 1,115   $ 1,167   $ 1,320   $ 1,423   $ 1,511  

(a)
Certain totals in the tables included in this proxy statement/prospectus may not sum due to rounding. Figures illustratively presented as if transaction closed on January 1, 2017.

(b)
Adjusted EBITDA, which is calculated as consolidated net earnings before interest, income taxes, stock-based compensation expense and depreciation and amortization expense, is a non-GAAP financial measure as it excludes amounts included in net earnings, the most directly comparable measure calculated in accordance with GAAP. This measure should not be considered as an alternative to net earnings or other measures derived in accordance with GAAP.

(c)
Comparable EBITDA means Adjusted EBITDA less stock-based compensation expense.

(d)
For illustrative purposes, assumes $125 million of run-rate synergies, 50% of which are achieved during the fiscal year ending 2018 and 100% of which are achieved during the fiscal year ending 2019 and thereafter. Assumes one-time costs to achieve synergies are equal to 50% of run-rate synergies and are incurred 75% in the fiscal year ending 2018 and 25% in the fiscal year ending 2019.

(e)
Includes transaction amortization, and it assumes transaction amortization is not tax deductible for cash tax purposes, per Liberty Interactive SEC filings.

(f)
This includes capitalized TV distribution fees of approximately $90 million per year.

(g)
Unlevered free cash flow means Comparable EBITDA (as defined in the preceding footnote (c)), plus illustrative net synergies (as described in the preceding footnote (d)), less unlevered cash taxes, less capital expenditures (as described in the immediately preceding footnote (f)), less the increase in net working capital.

        The QVC Group standalone adjusted unaudited forecasted financial information and the QVC Group pro forma adjusted unaudited forecasted financial information are based on various assumptions, including the following principal assumptions:

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        The estimates and assumptions underlying the QVC Group standalone unaudited forecasted financial information, the QVC Group standalone adjusted unaudited forecasted financial information and the QVC Group pro forma adjusted unaudited forecasted financial information are inherently uncertain and, though considered reasonable by the management of HSNi as of the date of the preparation of the QVC Group standalone adjusted unaudited forecasted financial information and the QVC Group pro forma adjusted unaudited forecasted financial information, as applicable, are subject to a wide variety of significant business, economic, regulatory and competitive risks and uncertainties that could cause actual results to differ materially from those contained in the unaudited forecasted financial information, including, among other things, the matters described in the sections entitled "Cautionary Statement Concerning Forward-Looking Statements" and "Risk Factors," respectively. Accordingly, there can be no assurance that the forecasted results are indicative of the future performance of the QVC Group, or that actual results will not differ materially from those presented in the QVC Group standalone adjusted unaudited forecasted financial information and the QVC Group pro forma adjusted unaudited forecasted financial information, as applicable.

        Inclusion of the QVC Group standalone unaudited forecasted financial information, the QVC Group standalone adjusted unaudited forecasted financial information and the QVC Group pro forma adjusted unaudited forecasted financial information in this proxy statement/prospectus should not be regarded as a representation by any person that the results contained in the QVC Group standalone unaudited forecasted financial information, the QVC Group standalone adjusted unaudited forecasted financial information or the QVC Group pro forma adjusted unaudited forecasted financial information will be achieved.

        None of the QVC Group standalone unaudited forecasted financial information, the QVC Group standalone adjusted unaudited forecasted financial information or the QVC Group pro forma adjusted unaudited forecasted financial information are included in this proxy statement/prospectus in order to induce any HSNi stockholder to vote in favor of any of the proposals at the HSNi special meeting.

Opinion of the Special Committee Financial Advisor (Centerview Partners)

        On July 5, 2017, Centerview Partners rendered to the Special Committee (with the other Qualified Directors present) its oral opinion, subsequently confirmed in a written opinion dated as of such date, that, as of such date and based upon and subject to various assumptions made, procedures followed, matters considered, and qualifications and limitations upon the review undertaken by Centerview Partners in preparing its opinion, the merger consideration was fair, from a financial point of view, to the holders of shares of HSNi common stock (other than Excluded Shares).

        The full text of Centerview Partners' written opinion, dated July 5, 2017, which describes the assumptions made, procedures followed, matters considered, and qualifications and limitations upon the review undertaken by Centerview Partners in preparing its opinion, is attached as Annex C to this proxy statement/prospectus and is incorporated herein by reference. The summary of the written opinion of Centerview Partners set forth below is qualified in its entirety to the full text of Centerview Partners' written opinion attached as Annex C to this proxy statement/prospectus and is incorporated herein by reference. Centerview Partners' financial advisory services and opinion were provided for the information and assistance of the Special Committee (in their capacity as directors and not in any other capacity) and, at the Special Committee's request, the HSNi board (in their capacity as directors and not in any individual capacity as an employee or designee of any particular shareholder) in connection with and for purposes of their consideration of the merger and Centerview Partners'

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opinion only addressed the fairness, from a financial point of view, as of the date thereof, to the holders of shares of HSNi common stock (other than Excluded Shares) of the merger consideration. Centerview Partners' opinion did not address any other term or aspect of the merger agreement or the merger and does not constitute a recommendation to any HSNi stockholder or any other person as to how such stockholder or other person should vote with respect to the merger or otherwise act with respect to the merger or any other matter.

         The full text of Centerview Partners' written opinion should be read carefully in its entirety for a description of the assumptions made, procedures followed, matters considered, and qualifications and limitations upon the review undertaken by Centerview Partners in preparing its opinion.

        In connection with rendering the opinion described above and performing its related financial analyses, Centerview Partners reviewed, among other things:

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        Centerview Partners also participated in discussions with members of the senior management and representatives of HSNi and Liberty Interactive regarding their assessment of the HSNi internal data (including, without limitation, the HSNi forecasts), the Liberty Interactive forecasts, the pro forma forecasts, the Liberty Interactive internal data and the synergies, as appropriate, and the strategic rationale for the merger. In addition, Centerview Partners reviewed publicly available financial and stock market data, including valuation multiples, for HSNi and Liberty Interactive (including shares of Liberty QVCA common stock) and compared that data with similar data for certain other companies, the securities of which are publicly traded, in lines of business that Centerview Partners deemed relevant. Centerview Partners also compared certain of the proposed financial terms of the merger with the financial terms, to the extent publicly available, of certain other transactions that Centerview Partners deemed relevant and conducted such other financial studies and analyses and took into account such other information as Centerview Partners deemed appropriate.

        Centerview Partners assumed, without independent verification or any responsibility therefor, the accuracy and completeness of the financial, legal, regulatory, tax, accounting and other information supplied to, discussed with, or reviewed by Centerview Partners for purposes of its opinion and has, with the Special Committee's consent, relied upon such information as being complete and accurate. In that regard, Centerview Partners assumed, at the Special Committee's direction, that the HSNi internal data (including, without limitation, the HSNi forecasts), the Liberty Interactive forecasts, the pro forma forecasts and the synergies have been reasonably prepared on bases reflecting the best currently available estimates and judgments of the management of HSNi as to the matters covered thereby and that the Liberty Interactive internal data have been reasonably prepared on bases reflecting the best currently available estimates and judgments of the management of Liberty Interactive as to the matters covered thereby, and Centerview Partners relied, at the Special Committee's direction, on the HSNi internal data (including, without limitation, the HSNi forecasts), the Liberty Interactive forecasts, the pro forma forecasts, the Liberty Interactive internal data and the synergies for purposes of Centerview Partners' analysis and opinion. Centerview Partners expressed no view or opinion as to the HSNi internal data (including, without limitation, the HSNi forecasts), the Liberty Interactive forecasts, the pro forma forecasts, the Liberty Interactive internal data and the synergies or the assumptions on which they are based. In addition, at the Special Committee's direction, Centerview Partners did not make any independent evaluation or appraisal of any of the assets or liabilities (contingent, derivative, off-balance-sheet or otherwise) of HSNi or Liberty Interactive, nor was Centerview Partners furnished with any such evaluation or appraisal and was not asked to conduct, and did not conduct, a physical inspection of the properties or assets of HSNi or Liberty Interactive. Centerview Partners assumed, at the Special Committee's direction, that the final executed merger agreement would not differ in any respect material to Centerview Partners' analysis or opinion from the execution copy reviewed by Centerview Partners. Centerview Partners also assumed, at the Special Committee's direction, that the merger will be consummated on the terms set forth in the merger agreement and in accordance with all applicable laws and other relevant documents or requirements, without delay or the waiver, modification or amendment of any term, condition or agreement, the effect of which would be material to Centerview Partners' analysis or opinion and that, in the course of obtaining the necessary governmental, regulatory and other approvals, consents, releases and waivers for the merger, no delay, limitation, restriction, condition or other change, including any divestiture requirements or amendments or modifications, will be imposed, the effect of which would be material to Centerview Partners' analysis or Centerview Partners' opinion. Centerview Partners further assumed, at the Special Committee's direction, that the merger will qualify for U.S. federal income tax purposes as a

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"reorganization" within the meaning of Section 368(a) of the Code. Centerview Partners did not evaluate and did not express any opinion as to the solvency or fair value of HSNi, Liberty Interactive or the QVC Group, or the ability of HSNi, Liberty Interactive or the QVC Group to pay their respective obligations when they come due, or as to the impact of the merger on such matters, under any state, federal or other laws relating to bankruptcy, insolvency or similar matters. Centerview Partners is not a legal, regulatory, tax or accounting advisor, and Centerview Partners expressed no opinion as to any legal, regulatory, tax or accounting matters.

        Centerview Partners' opinion expressed no view as to, and did not address, HSNi's underlying business decision to proceed with or effect the merger, or the relative merits of the merger as compared to any alternative business strategies or transactions that might be available to HSNi or in which HSNi might engage. Centerview Partners was not requested to solicit, and did not solicit, interest from other parties with respect to an acquisition of, or other business combination with, HSNi or any other alternative transaction. Centerview Partners' opinion was limited to and addressed only the fairness, from a financial point of view, as of the date of Centerview Partners' written opinion, to the holders of the HSNi common stock (other than Excluded Shares) of the merger consideration. For purposes of its opinion, Centerview Partners was not asked to, and Centerview Partners did not, express any view on, and its opinion did not address, any other term or aspect of the merger agreement or the merger, including, without limitation, the structure or form of the merger, or any other agreements or arrangements contemplated by the merger agreement or entered into in connection with or otherwise contemplated by the merger, including, without limitation, the fairness of the merger or any other term or aspect of the merger to, or any consideration to be received in connection therewith by, or the impact of the merger on, the holders of any other class of securities, creditors or other constituencies of HSNi or any other party. In addition, Centerview Partners expressed no view or opinion as to the fairness (financial or otherwise) of the amount, nature or any other aspect of any compensation to be paid or payable to any of the officers, directors or employees of HSNi or any party, or class of such persons in connection with the merger, whether relative to the consideration to be paid by Liberty Interactive for each share of HSNi common stock pursuant to the merger agreement or otherwise. Centerview Partners' opinion was necessarily based on financial, economic, monetary, currency, market and other conditions and circumstances as in effect on, and the information made available to Centerview Partners as of, the date of Centerview Partners' written opinion, and Centerview Partners does not have any obligation or responsibility to update, revise or reaffirm its opinion based on circumstances, developments or events occurring after the date of Centerview Partners' written opinion. With respect to the shares of Liberty QVCA common stock to be issued pursuant to the merger, Centerview Partners did not take into account any feature of such shares other than the economic rights attaching to such shares. Centerview Partners expressed no view or opinion as to what the value of shares of Liberty QVCA common stock actually will be when issued pursuant to the merger or the prices at which the shares of HSNi common stock or Liberty QVCA common stock will trade or otherwise be transferable at any time, including following the announcement or consummation of the merger. Centerview Partners' opinion does not constitute a recommendation to any HSNi stockholder or any other person as to how such stockholder or other person should vote with respect to the merger or otherwise act with respect to the merger or any other matter. Centerview Partners' financial advisory services and its written opinion were provided for the information and assistance of the Special Committee (in their capacity as directors and not in any other capacity) and, at the Special Committee's request, the HSNi board (in their capacity as directors and not in any individual capacity as an employee or designee of any particular HSNi stockholder) in connection with and for purposes of their consideration of the merger. The issuance of Centerview Partners' opinion was approved by the Centerview Partners LLC Fairness Opinion Committee.

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        The following is a summary of the material financial analyses prepared and reviewed with the Special Committee (with the other Qualified Directors present) in connection with Centerview Partners' opinion, dated July 5, 2017. The summary set forth below does not purport to be a complete description of the financial analyses performed or factors considered by, and underlying the opinion of, Centerview Partners, nor does the order of the financial analyses described represent the relative importance or weight given to those financial analyses by Centerview Partners. Centerview Partners may have deemed various assumptions more or less probable than other assumptions, so the reference ranges resulting from any particular portion of the analyses summarized below should not be taken to be Centerview Partners' view of the actual value of HSNi, Liberty Interactive or the QVC Group pro forma for the merger. Some of the summaries of the financial analyses set forth below include information presented in tabular format. In order to fully understand the financial analyses, the tables must be read together with the text of each summary, as the tables alone do not constitute a complete description of the financial analyses performed by Centerview Partners. Considering the data in the tables below without considering all financial analyses or factors or the full narrative description of such analyses or factors, including the methodologies and assumptions underlying such analyses or factors, could create a misleading or incomplete view of the processes underlying Centerview Partners' financial analyses and its opinion. In performing its analyses, Centerview Partners made numerous assumptions with respect to industry performance, general business and economic conditions and other matters, many of which are beyond the control of HSNi or any other parties to the merger. None of HSNi, Liberty Interactive, Merger Sub or Centerview Partners or any other person assumes responsibility if future results are materially different from those discussed. Any estimates contained in these analyses are not necessarily indicative of actual values or predictive of future results or values, which may be significantly more or less favorable than as set forth below. In addition, analyses relating to the value of HSNi, Liberty Interactive or the QVC Group pro forma for the merger do not purport to be appraisals or reflect the prices at which HSNi, Liberty Interactive or the QVC Group pro forma for the merger may actually be sold. Accordingly, the assumptions and estimates used in, and the results derived from, the financial analyses are inherently subject to substantial uncertainty. Except as otherwise noted, the following quantitative information, to the extent that it is based on market data, is based on market data as it existed on or before July 5, 2017 (the last trading day before the public announcement of the merger), and is not necessarily indicative of current market conditions.

        Centerview Partners performed separate discounted cash flow analyses of HSNi and the QVC Group based on the internal data. A discounted cash flow analysis is a traditional valuation methodology used to derive a valuation of an asset by calculating the "present value" of estimated future cash flows of the asset. "Present value" refers to the current value of future cash flows and is obtained by discounting those future cash flows by a discount rate that takes into account macroeconomic assumptions and estimates of risk, the opportunity cost of capital, expected returns and other appropriate factors.

        Centerview Partners performed a discounted cash flow analysis of HSNi based on the HSNi internal data. In performing this analysis, Centerview Partners calculated a range of illustrative equity values for HSNi by discounting to present value as of July 5, 2017, using discount rates ranging from 9.0% to 10.0% (reflecting Centerview Partners' analysis of HSNi's weighted average cost of capital) and the mid-year convention: (a) (i) the forecasted unlevered after-tax free cash flows of HSNi over the period beginning March 31, 2017 and ending December 31, 2021, utilizing the HSNi internal data and the assumptions provided by HSNi management, and (ii) a range of illustrative terminal values of

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HSNi, calculated by Centerview Partners applying perpetuity growth rates ranging from 1.0% to 3.0% to HSNi's after-tax unlevered free cash flows for the terminal year and (b) subtracting from the foregoing results the face value of HSNi's net debt as of March 31, 2017. Centerview Partners divided the result of the foregoing calculations by the number of fully diluted outstanding shares of HSNi common stock as of June 29, 2017 based on the HSNi internal data to derive a range of implied values per share of HSNi common stock of $33.00 to $51.00, rounded to the nearest $1.00. Centerview Partners compared this range to the value of the merger consideration of $40.36 per share implied by the 1.650 exchange ratio, based on the closing price of Liberty QVCA common stock on July 5, 2017 of $24.46 per share.

        Centerview Partners also performed a discounted cash flow analysis of the QVC Group based on the Liberty Interactive forecasts and the Liberty Interactive internal data. In performing this analysis, Centerview Partners calculated a range of illustrative equity values for the QVC Group by discounting to present value as of July 5, 2017, using discount rates ranging from 8.5% to 9.5% (reflecting Centerview Partners' analysis of QVC Group's weighted average cost of capital) and the mid-year convention: (a) (i) the forecasted unlevered after-tax free cash flows of the QVC Group over the period beginning March 31, 2017 and ending December 31, 2021, utilizing the Liberty Interactive forecasts, the Liberty Interactive internal data and the assumptions provided by HSNi management, and (ii) a range of illustrative terminal values of the QVC Group, calculated by Centerview Partners applying perpetuity growth rates ranging from 1.0% to 3.0% to the QVC Group's after-tax unlevered free cash flows for the terminal year, (b) subtracting from the foregoing results (i) the face value of the QVC Group's net debt, as of March 31, 2017 and (ii) the estimated market value of the QVC Group's non-controlling interests, and (c) adding to the foregoing results (i) the market value of Liberty Interactive's stake in HSNi as of July 5, 2017 and (ii) the estimated market value of QVC Group's stake in its joint venture in China with Beijing-based CNR Media Group. Centerview Partners divided the result of the foregoing calculations by the number of fully diluted outstanding shares of Liberty QVCA common stock as of June 30, 2017 based on the Liberty Interactive internal data to derive a range of implied values per share of Liberty QVCA common stock of $18.00 to $32.00, rounded to the nearest $1.00.

        Centerview Partners reviewed and compared certain information relating to the following selected transactions involving publicly traded companies in the retail industry with a total enterprise value of at least $500 million (where sufficient public information was available to calculate enterprise value as a multiple of the last twelve months EBITDA) announced since January 1, 2010 that Centerview

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Partners, based on its experience and professional judgment, deemed relevant to consider in relation to HSNi and the merger.

Announcement Date
  Acquiror   Target
December 2010   Leonard Green & Partners, L.P.   Jo-Ann Stores, Inc.

May 2012

 

Ascena Retail Group, Inc.

 

Charming Shoppes Inc.

May 2012

 

Bed Bath & Beyond Inc.

 

Cost Plus Inc.

November 2012

 

Berkshire Hathaway Inc.

 

Oriental Trading Company, Inc.

November 2012

 

Leon's Furniture Limited

 

The Brick Ltd.

February 2013

 

Office Depot, Inc.

 

Office Max Incorporated

July 2013

 

Hudson's Bay Company

 

Saks Incorporated

September 2013

 

Ares Management LLC and Canada Pension Plan Investment Board

 

Neiman Marcus Group, Inc.

December 2013

 

Sycamore Partners

 

The Jones Group Inc.

February 2014

 

Signet Jewelers Limited

 

Zale Corporation

September 2014

 

Capmark Financial Group Inc.

 

Bluestem Brands, Inc.

December 2014

 

Buyer Group led by BC Partners, Inc.

 

PetSmart, Inc.

May 2015

 

Ascena Retail Group, Inc.

 

ANN INC.

August 2015

 

Sycamore Partners

 

Belk, Inc.

November 2015

 

CVC Capital Partners Limited and Canada Pension Plan Investment Board

 

PETCO Animal Supplies, Inc.

February 2016

 

Lowe's Companies, Inc.

 

RONA, INC.

October 2016

 

Bass Pro Group, LLC

 

Cabela's Incorporated

May 2017

 

Coach, Inc.

 

Kate Spade & Company

June 2017

 

Sycamore Partners

 

Staples, Inc.

        No company or transaction used in this analysis is identical or directly comparable to HSNi or the merger, respectively. The companies included in the selected transactions listed above were selected, among other reasons, because they have certain characteristics that, for the purposes of this analysis, may be considered similar to certain characteristics of HSNi. The transactions were selected, among other reasons, because their participants, size or other factors, for purposes of Centerview Partners' analysis, may be considered similar to the merger. The reasons for and the circumstances surrounding each of the selected transactions analyzed were diverse and there are inherent differences in the business, operations, financial conditions and prospects of HSNi and the companies included in the selected transactions analysis. Accordingly, Centerview Partners believed that it was inappropriate to, and therefore did not, rely solely on the quantitative results of the selected transactions analysis. This analysis involves complex considerations and qualitative judgments concerning differences in financial and operating characteristics and other factors that could affect the public trading, acquisition or other values of the selected target companies and HSNi.

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        Financial data for the selected transactions were based solely on publicly available information at the time of the announcement of the relevant transactions that Centerview Partners obtained from SEC filings and other data sources.

        Centerview Partners calculated, for each selected transaction set forth above, among other things, the enterprise value (which is defined as equity value, calculated using the number of fully diluted shares of a company and using the treasury stock method, plus total debt and non-controlling interests, less unrestricted cash and cash equivalents, less equity method investments), which is referred to in this summary of Centerview Partners' opinion as EV , implied for the applicable target company based on the consideration payable in the applicable selected transaction as a multiple of the target company's EBITDA for the latest twelve-month period for which financial information had been made public, which is referred to in this summary of Centerview Partners' opinion as LTM Comparable EBITDA , at the time of the transaction announcement. The results of this analysis are summarized as follows:

25 th  Percentile

    7.2x  

Median

    9.4x  

75 th  Percentile

    11.3x  

        Based on its analysis and other considerations that Centerview Partners deemed relevant in its professional judgment, Centerview Partners applied a range of multiples of 8.0x to 10.0x to HSNi's LTM Comparable EBITDA of $269 million for the period ended March 31, 2017, as reflected in the HSNi internal data, which resulted in a range of implied values per share of HSNi common stock of approximately $31.00 to $41.00, rounded to the nearest $1.00. Centerview Partners compared this range to the value of the merger consideration of $40.36 per share implied by the 1.650 exchange ratio, based on the closing price of Liberty QVCA common stock on July 5, 2017 of $24.46 per share.

        Centerview Partners reviewed and compared certain financial information, ratios and public market multiples for HSNi and the QVC Group to corresponding financial information, ratios and public market multiples of the following publicly traded companies in the specialty, home stores, department/mass and eCommerce retail industries that Centerview Partners deemed comparable, based on its experience and professional judgment, to HSNi and the QVC Group, which are referred to in this summary of Centerview Partners' opinion as the selected companies :

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        Although none of the selected companies is directly comparable to HSNi or the QVC Group, the companies listed above were chosen by Centerview Partners, among other reasons, because they are publicly traded companies with certain operational, business and/or financial characteristics that, for purposes of Centerview Partners' analysis, may be considered similar to those of HSNi and the QVC Group. However, because none of the selected companies is exactly the same as HSNi or the QVC Group, Centerview Partners believed that it was inappropriate to, and therefore did not, rely solely on the quantitative results of the selected public company analysis. Accordingly, Centerview Partners also made qualitative judgments, based on its experience and professional judgment, concerning differences between the business, financial and operating characteristics and prospects of HSNi, the QVC Group and the selected companies that could affect the public trading values of each in order to provide a context in which to consider the results of the quantitative analysis.

        Using publicly available information obtained from SEC filings and other data sources as of July 5, 2017, Centerview Partners also calculated and compared various financial multiples for the selected companies, HSNi and the QVC Group. With respect to the selected companies, HSNi and the QVC Group, Centerview Partners calculated:

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        The results of these analyses are summarized as follows:

 
  Price/Comparable
EPS
  NTM EV/Comparable
EBITDA
 

Selected Public Companies:

             

25th Percentile

    10.6x     4.9x  

Median

    13.1x     7.4x  

75th Percentile

    17.5x     9.4x  

HSNi Consensus

    11.9x     7.7x  

QVC Group Consensus

    13.3x     8.9x  

        Based on the foregoing analysis and other considerations that Centerview Partners deemed relevant in its professional judgment, Centerview Partners (i) applied a range of 12.0x to 16.0x to HSNi's estimated next twelve months Comparable EPS of $2.70 based on the HSNi internal data, which resulted in a range of implied values per share of HSNi common stock of $32.00 to $43.00, rounded to the nearest $1.00, and (ii) applied a range of multiples of 7.0x to 9.0x to HSNi's next twelve months estimated Comparable EBITDA of approximately $294 million based on the HSNi internal data, which resulted in a range of implied values per share of HSNi common stock of $29.00 to $40.00, rounded to the nearest $1.00. Centerview Partners compared these ranges to the value of the merger consideration of $40.36 per share implied by the exchange ratio (calculated by multiplying the 1.650 exchange ratio by the $24.46 closing price per share of Liberty QVCA common stock on July 5, 2017).

        Based on the foregoing analysis and other considerations that Centerview Partners deemed relevant in its professional judgment, Centerview Partners applied a range of multiples of 7.0x to 9.0x to the QVC Group's next twelve months estimated Comparable EBITDA of approximately $1,957 million, based on the Liberty Interactive forecasts, which resulted in a range of implied values of $17.00 to $25.00 per share of Liberty QVCA common stock, rounded to the nearest $1.00.

        Centerview Partners observed certain additional information that was not considered part of its financial analyses for its opinion but was noted for informational purposes, including, among other things, the following:

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General

        The preparation of a financial opinion is a complex analytical process involving various determinations as to the most appropriate and relevant methods of financial analysis and the application of those methods to the particular circumstances and, therefore, a financial opinion is not readily susceptible to summary description. In arriving at its opinion, Centerview Partners did not draw, in isolation, conclusions from or with regard to any factor or analysis that it considered. Rather, Centerview Partners made its determination as to fairness on the basis of its experience and professional judgment after considering the results of all of the analyses.

        Centerview Partners' financial analyses and opinion were only one of many factors taken into consideration by the Special Committee in their evaluation of the merger. Consequently, the analyses described above should not be viewed as determinative of the views of the Special Committee or the HSNi board with respect to the exchange ratio or as to whether the Special Committee or the HSNi board would have been willing to determine that a different consideration was fair. The consideration for the merger was determined through arm's-length negotiations between the Special Committee and Liberty Interactive and was recommended by the Special Committee and approved by the HSNi board. Centerview Partners provided advice to the Special Committee during these negotiations. Centerview Partners did not, however recommend any specific amount of consideration to the Special Committee or the HSNi board that any specific amount of consideration constituted the only appropriate consideration for the merger.

        Centerview Partners is a securities firm engaged directly and through affiliates and related persons in a number of investment banking, financial advisory and merchant banking activities. In the two years prior to the delivery of its opinion, except for Centerview Partners' current engagement by the Special Committee, Centerview Partners has not been engaged to provide financial advisory or other services to HSNi, and, except in connection with such current engagement, Centerview Partners has not received any compensation from HSNi. In the two years prior to the delivery of its opinion, Centerview Partners has not been engaged to provide financial advisory or other services to Liberty Interactive or Merger Sub and Centerview Partners has not received any compensation from Liberty Interactive or Merger Sub. Centerview Partners may provide investment banking and other services to or with respect to HSNi, Liberty Interactive or their respective affiliates in the future, for which Centerview Partners may receive compensation. Certain (i) of Centerview Partners and its affiliates' directors, officers, members and employees, or family members of such persons, (ii) of Centerview Partners' affiliates or related investment funds and (iii) investment funds or other persons in which any of the foregoing may have financial interests or with which they may co-invest, may at any time acquire, hold, sell or trade, in debt, equity and other securities or financial instruments (including derivatives, bank loans or other obligations) of, or investments in, HSNi, Liberty Interactive or any of their respective affiliates, or any other party that may be involved in the merger.

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        The Special Committee selected Centerview Partners as its financial advisor in connection with the merger because it is an internationally recognized investment banking firm that has substantial experience in transactions similar to the merger.

        In connection with Centerview Partners' services as the financial advisor to the Special Committee, HSNi has agreed to pay Centerview Partners an aggregate fee that is estimated, based on the information available as of the date of announcement, at approximately $20 million, of which $1 million was payable upon the execution of the engagement letter, $1 million was payable upon the rendering of Centerview Partners' opinion and the remainder is payable contingent upon consummation of the merger. In addition, HSNi has agreed to reimburse certain of Centerview Partners' expenses arising, and to indemnify Centerview Partners against certain liabilities that may arise, out of Centerview Partners' engagement.

        To resolve certain concerns raised by Liberty Interactive about the aggregate transaction fees payable to Goldman Sachs and Centerview Partners by HSNi under their respective engagement letters in light of Liberty Interactive's existing significant equity interest in HSNi, Goldman Sachs and Centerview Partners orally advised Liberty Interactive that, to the extent they were engaged in the future to provide investment banking advisory services to Liberty Interactive or certain entities controlled by Liberty Interactive, each would provide, depending on the circumstances, a credit of up to $5,000,000 toward such engagement. The foregoing discussion did not include any commitment or agreement by Liberty Interactive to hire Goldman Sachs or Centerview Partners for future work or any commitment or agreement by Goldman Sachs or Centerview Partners to provide any future investment banking advisory services to Liberty Interactive or any other entity.

Opinion of the Special Committee Financial Advisor (Goldman Sachs)

        Goldman Sachs rendered its opinion to the Special Committee (with the other Qualified Directors present) that, as of July 5, 2017, and based upon and subject to the factors and assumptions set forth therein, the consideration to be paid by Liberty Interactive for each share of HSNi common stock pursuant to the merger agreement was fair from a financial point of view to the HSNi stockholders (other than the Liberty Interactive related entities).

         The full text of the written opinion of Goldman Sachs, dated July 5, 2017, which sets forth assumptions made, procedures followed, matters considered and limitations on the review undertaken in connection with the opinion, is attached as Annex D to this proxy statement/prospectus and is incorporated herein by reference. Goldman Sachs provided its opinion for the information and assistance of the Special Committee and, at the Special Committee's request, the information and assistance of the HSNi board in connection with their consideration of the merger. The Goldman Sachs opinion is not a recommendation as to how any HSNi stockholder should vote with respect to the merger, or any other matter.

        In connection with rendering the opinion described above and performing its related financial analyses, Goldman Sachs reviewed, among other things:

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        Goldman Sachs also held discussions with members of the senior managements of HSNi and Liberty Interactive regarding their assessment of the strategic rationale for, and the potential benefits of, the merger and the past and current business operations, financial condition and future prospects of Liberty Interactive; held discussions with members of the senior management of HSNi regarding their assessment of the past and current business operations, financial condition and future prospects of HSNi; reviewed the reported price and trading activity for the HSNi common stock and Liberty QVCA common stock; compared certain financial and stock market information for HSNi and Liberty Interactive with similar information for certain other companies the securities of which are publicly traded; reviewed the financial terms of certain recent business combinations in the specialty, home, department/mass and eCommerce retail industries and in other industries; and performed such other studies and analyses, and considered such other factors, as it deemed appropriate.

        For purposes of rendering its opinion, Goldman Sachs, with the consent of the Special Committee, relied upon and assumed the accuracy and completeness of all of the financial, legal, regulatory, tax, accounting and other information provided to, discussed with or reviewed by, it, without assuming any responsibility for independent verification thereof. In that regard, Goldman Sachs assumed with the consent of the Special Committee that the Forecasts, including the Synergies, were reasonably prepared on a basis reflecting the best currently available estimates and judgments of the management of HSNi. Goldman Sachs did not make an independent evaluation or appraisal of the assets and liabilities (including any contingent, derivative or other off-balance-sheet assets and liabilities) of HSNi or Liberty Interactive or any of their respective subsidiaries and it was not furnished with any such evaluation or appraisal. Goldman Sachs assumed that all governmental, regulatory or other consents and approvals necessary for the consummation of the merger will be obtained without any adverse effect on HSNi or Liberty Interactive or on the expected benefits of the merger in any way meaningful to its analysis. Goldman Sachs also assumed that the merger will be consummated on the terms set forth in the merger agreement, without the waiver or modification of any term or condition the effect of which would be in any way meaningful to its analysis.

        Goldman Sachs' opinion does not address the underlying business decision of HSNi to engage in the merger or the relative merits of the merger as compared to any strategic alternatives that may be available to HSNi; nor does it address any legal, regulatory, tax or accounting matters. Goldman Sachs was not requested to solicit, and did not solicit, interest from other parties with respect to an acquisition of, or other business combination with, HSNi or any other alternative merger. Goldman Sachs' opinion addresses only the fairness from a financial point of view to the HSNi stockholders (other than the Liberty Interactive related entities and their respective affiliates), as of the date of the opinion, of the consideration to be paid by Liberty Interactive for each share of HSNi common stock pursuant to the merger agreement. Goldman Sachs' opinion does not express any view on, and does not address, any other term or aspect of the merger agreement or the merger or any term or aspect of any other agreement or instrument contemplated by the merger agreement or entered into or amended in connection with the merger, including the fairness of the merger to, or any consideration received in

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connection therewith by, the holders of any other class of securities, creditors, or other constituencies of HSNi; nor as to the fairness of the amount or nature of any compensation to be paid or payable to any of the officers, directors or employees of HSNi, or class of such persons in connection with the merger, whether relative to the consideration to be paid by Liberty Interactive for each share of HSNi common stock pursuant to the merger agreement or otherwise. With respect to the shares of Liberty QVCA common stock to be issued pursuant to the merger, Goldman Sachs did not take into account any feature of such shares other than the economic rights attaching to such shares. Goldman Sachs's opinion did not express any opinion as to the prices at which shares of Liberty QVCA common stock will trade at any time or as to the impact of the merger on the solvency or viability of HSNi, Liberty Interactive or the QVC Group or the ability of HSNi, Liberty Interactive or the QVC Group to pay their respective obligations when they come due. Goldman Sachs' opinion was necessarily based on economic, monetary market and other conditions, as in effect on, and the information made available to it as of the date of the opinion and Goldman Sachs assumed no responsibility for updating, revising or reaffirming its opinion based on circumstances, developments or events occurring after the date of its opinion. Goldman Sachs' opinion was approved by a fairness committee of Goldman Sachs.

        The following is a summary of the material financial analyses delivered by Goldman Sachs to the Special Committee (with the other Qualified Directors present) in connection with rendering the opinion described above. The following summary, however, does not purport to be a complete description of the financial analyses performed by Goldman Sachs, nor does the order of analyses described represent relative importance or weight given to those analyses by Goldman Sachs. Some of the summaries of the financial analyses include information presented in tabular format. The tables must be read together with the full text of each summary and are alone not a complete description of Goldman Sachs' financial analyses. Except as otherwise noted, the following quantitative information, to the extent that it is based on market data, is based on market data as it existed on or before July 5, 2017, the last trading day before the public announcement of the merger, and is not necessarily indicative of current market conditions.

        Goldman Sachs analyzed the $40.36 implied per share consideration (calculated by multiplying the 1.650 exchange ratio by the $24.46 closing price per share of Liberty QVCA common stock on July 5, 2017) to be paid to HSNi stockholders (other than Liberty Interactive and its wholly owned subsidiaries) pursuant to the merger agreement in relation to (a) the closing price per share of HSNi common stock on July 5, 2017, (b) the highest and lowest closing prices per share of HSNi common stock over the 52-week period ended July 5, 2017, and the volume weighted average prices per share of the HSNi common stock over the 30- and 90-day periods ended July 5, 2017.

        This analysis indicated that the implied per share consideration to be paid to HSNi stockholders (other than Liberty Interactive and its wholly owned subsidiaries) pursuant to the merger agreement represented:

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        Goldman Sachs reviewed and compared certain financial information, ratios and public market multiples for HSNi and the QVC Group to corresponding financial information, ratios and public market multiples for the following publicly traded corporations in the specialty, home stores, department/mass and eCommerce retail industries, which are referred to in this summary of Goldman Sachs' opinion, collectively, as the selected companies :

        Although none of the selected companies is directly comparable to HSNi or the QVC Group, the companies included were chosen because they are publicly traded companies with operations that for purposes of analysis may be considered similar to certain operations of HSNi and the QVC Group.

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        Goldman Sachs also calculated and compared various financial multiples for the selected companies, HSNi and the QVC Group based on financial and trading data as of July 5, 2017, as well as information it obtained from SEC filings and Wall Street research. With respect to the selected companies, HSNi and the QVC Group, Goldman Sachs calculated:

        The results of these analyses, based on Wall Street research, are summarized as follows:

 
  Price/Comparable
EPS
  NTM EV/Comparable
EBITDA
 

Selected Public Companies:

             

25 th  Percentile

    10.6x     4.9x  

Median

    13.1x     7.4x  

75 th  Percentile

    17.5x     9.4x  

HSNi consensus

    11.9x     7.7x  

QVC Group consensus

    13.3x     8.9x  

        Additionally, Goldman Sachs calculated the enterprise value of HSNi using the merger consideration's implied price per share of $40.36 as a multiple of 2017 estimated Comparable EPS of HSNi, as set forth in the Forecasts, and the merger consideration's implied price per share of HSNi common stock of $40.36 at a multiple of 2017 estimated Comparable EBITDA of HSNi as set forth in the Forecasts:

HSNi Price (using the merger consideration's implied price per share of $40.36)/2017E Comparable EPS (using the Forecasts):

    17.2x  

HSNi EV (using the merger consideration's implied price per share of $40.36)/2017 Comparable EBITDA (using the Forecasts):

   
10.1x
 

        Goldman Sachs analyzed certain information relating to the following selected transactions in the retail industry since January 1, 2010, with a total enterprise value of at least $500 million where sufficient public information was available to calculate enterprise value as a multiple of the last twelve months EBITDA:

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        While none of the target companies that participated in the selected transactions are directly comparable to HSNi, the companies that participated in the selected transactions are companies with operations that, for the purposes of analysis, may be considered similar to certain of HSNi's results, market size and product profile.

        For each of the selected transactions, Goldman Sachs calculated and compared enterprise value as a multiple of the last twelve months Comparable EBITDA. The analysis reflected multiples at the 25th percentile, median, and 75th percentile of 7.2x, 9.4x and 11.3x, respectively. Goldman Sachs then applied a range of 8.0x to 10.0x to HSNi's last twelve months Comparable EBITDA, which analysis resulted in a range of illustrative implied prices per share of HSNi common stock of approximately $31.00 to $41.00, rounded to the nearest $1.00.

        Goldman Sachs performed illustrative analyses of the implied present value of the future value per share of HSNi common stock and Liberty QVCA common stock, in each case on a stand-alone basis, and Liberty QVCA common stock pro forma for the merger, which analyses are designed to provide an indication of the present value of a theoretical future value of the equity of HSNi and the QVC Group, in each case on a stand-alone basis, and the QVC Group pro forma for the merger, respectively, as a function of the estimated one-year forward enterprise value to future EBITDA multiple, which is referred to in this summary of Goldman Sachs' opinion as the one-year forward EV/EBITDA multiple .

        For the analysis of shares of HSNi common stock on a stand-alone basis, Goldman Sachs first used the Forecasts for fiscal years 2018 through 2021 to calculate implied values per share of HSNi common

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stock on a stand-alone basis as of January 1 for each of the fiscal years 2018 to 2021. Then, Goldman Sachs applied a range of enterprise value to one-year forward EV/EBITDA multiples of 7.0x to 9.0x to HSNi's Comparable EBITDA, and then discounted the implied future value of the share price, including dividends, back to March 31, 2017, using an illustrative discount rate of 9.5%, reflecting an estimate of HSNi's cost of equity. This analysis resulted in a range of illustrative implied present values of $33.55 to $49.99 per share of HSNi common stock.

        For the analysis of shares of Liberty QVCA common stock on a stand-alone basis, Goldman Sachs first used the Forecasts for fiscal years 2018 through 2021 to calculate implied values per share of Liberty QVCA common stock on a stand-alone basis as of January 1 for each of the fiscal years 2018 to 2021. Then, Goldman Sachs applied a range of enterprise value to one-year forward EV/EBITDA multiples of 7.0x to 9.0x to the QVC Group's Comparable EBITDA, and then discounted the implied future value of the share price, including dividends, back to March 31, 2017, using an illustrative discount rate of 11.0%, reflecting an estimate of the QVC Group's cost of equity. This analysis resulted in a range of illustrative implied present values of $17.22 to $29.53 per share of Liberty QVCA common stock.

        For the analysis of shares of Liberty QVCA common stock pro forma for the merger, Goldman Sachs first used the Forecasts for fiscal years 2018 through 2021, including the Synergies, to calculate implied values per share of Liberty QVCA common stock pro forma for the merger as of January 1 for each of the fiscal years 2018 to 2021. Then, Goldman Sachs applied a range of enterprise value to one-year forward EV/EBITDA multiples of 7.0x to 9.0x to the QVC Group's Comparable EBITDA pro forma for the merger, and then discounted the implied future value of the share price, including dividends, back to March 31, 2017, using an illustrative discount rate of 11.0%, reflecting an estimate of the QVC Group's cost of equity pro forma for the merger. This analysis resulted in a range of illustrative implied present values of $22.14 to $35.19 per share of Liberty QVCA common stock pro forma for the merger.

        Goldman Sachs then calculated an illustrative range of implied present values of the merger consideration by multiplying this range of illustrative implied present values per share of Liberty QVCA common stock by the exchange ratio of 1.650. This analysis yielded an illustrative range of implied values per share of $36.52 to $58.06.

        Goldman Sachs performed illustrative discounted cash flow analyses on HSNi, the QVC Group stand-alone and the QVC Group pro forma for the merger, in each case using the Forecasts (which, in the case of the pro forma combined company, included the Synergies).

        For the discounted cash flow analysis of HSNi on a stand-alone basis, using discount rates ranging from 8.0% to 9.5%, reflecting estimates of HSNi's weighted average cost of capital, Goldman Sachs discounted to present value as of March 31, 2017 (i) estimates of unlevered free cash flow for HSNi for the years 2017 through 2021 as reflected in the Forecasts and (ii) a range of illustrative terminal values for HSNi, which were calculated by applying perpetuity growth rates ranging from 1.5% to 2.5%, to a terminal year estimate of the unlevered free cash flow to be generated by HSNi, as reflected in the Forecasts. Goldman Sachs derived ranges of illustrative enterprise values for HSNi by adding the ranges of present values it derived above. Goldman Sachs then subtracted from this range of illustrative

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enterprise values HSNi's net debt as of March 31, 2017, as provided by the management of HSNi, to derive a range of illustrative equity values for HSNi. Goldman Sachs then divided the range of illustrative equity values it derived by the number of fully diluted outstanding shares of HSNi as of June 29, 2017, as provided by the management of HSNi, to derive a range of illustrative present values per share ranging from $36.42 to $53.98.

        For the discounted cash flow analysis of the QVC Group, using discount rates ranging from 8.0% to 9.5%, reflecting estimates of the QVC Group's weighted average cost of capital, Goldman Sachs discounted to present value as of March 31, 2017 (i) estimates of unlevered free cash flow for the QVC Group for the years 2017 through 2021 as reflected in the Forecasts and (ii) a range of illustrative terminal values for the QVC Group, which were calculated by applying perpetuity growth rates ranging from 1.5% to 2.5%, to a terminal year estimate of the unlevered free cash flow to be generated by the QVC Group, as reflected in the Forecasts. Goldman Sachs derived ranges of illustrative enterprise values for the QVC Group by adding the ranges of present values it derived above. From the range of illustrative enterprise values it derived for the QVC Group, Goldman Sachs then (a) subtracted (i) net debt as of March 31, 2017, as provided by the management of HSNi and (ii) the estimated market value of the QVC Group's non-controlling interests and (b) added (i) the market value of Liberty Interactive's stake in HSNi as of July 5, 2017 and (ii) the estimated market value of QVC Group's stake in its joint venture in China with Beijing-based CNR Media Group to derive a range of illustrative equity values for the QVC Group. Goldman Sachs then divided the range of illustrative equity values it derived by the number of fully diluted outstanding shares of Liberty QVCA common stock as of June 30, 2017, as provided by the management of HSNi, to derive a range of illustrative present values per share ranging from $19.79 to $32.31.

        For the discounted cash flow analysis of the QVC Group pro forma for the merger, using discount rates ranging from 8.0% to 9.5%, reflecting estimates of the QVC Group's weighted average cost of capital pro forma for the merger, Goldman Sachs discounted to present value as of March 31, 2017 (i) estimates of unlevered free cash flow for the QVC Group pro forma for the merger for the years 2017 through 2021 as reflected in the Forecasts and (ii) a range of illustrative terminal values for the QVC Group pro forma for the merger, which were calculated by applying perpetuity growth rates ranging from 1.5% to 2.5%, to a terminal year estimate of the unlevered free cash flow to be generated by the QVC Group pro forma for the merger, as reflected in the Forecasts. Goldman Sachs derived ranges of illustrative enterprise values for the QVC Group pro forma for the merger by adding the ranges of present values it derived above. Goldman Sachs then (a) subtracted (i) net debt as of March 31, 2017, as provided by the management of HSNi and (ii) the estimated market value of the QVC Group's non-controlling interests and (b) added the estimated market value of QVC Group's stake in its joint venture in China with Beijing-based CNR Media Group, to derive a range of illustrative equity values for the QVC Group pro forma for the merger. Goldman Sachs then divided the range of illustrative equity values it derived by the number of fully diluted outstanding shares of common stock of the QVC Group pro forma for the merger as of June 29, 2017 (for HSNi common stock) and June 30, 2017 (for Liberty QVCA common stock), as provided by the management of HSNi to derive a range of illustrative present values per share of Liberty QVCA common stock pro forma for the merger. Goldman Sachs then multiplied the exchange ratio of 1.650 by this range of illustrative present values per share of Liberty QVCA common stock to obtain an illustrative range of implied values of the per share merger consideration of $37.26 to $60.97.

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        Using information obtained from public filings, public databases and press reports, Goldman Sachs analyzed certain information relating to all-stock consideration acquisition transactions since 2007, with a total enterprise value of at least $500 million, with a U.S. target in which the target's shareholders owned less than 35% of the pro forma company, excluding transactions in the real estate, financial and energy industries. Goldman Sachs calculated the implied price per share represented by the exchange ratio, based on the last closing price per share of the Liberty QVCA common stock before announcement of the merger, in relation to the closing trading price of HSNi common stock one trading day earlier. Based on these calculations, the 25th percentile, median, and 75th percentile of premiums in these transactions were 17%, 25% and 36%, respectively. Goldman Sachs then applied a range of premiums of 15% to 35% to the closing trading price per share of HSNi common stock on July 5, 2017, which analysis resulted in a range of implied prices per share of HSNi common stock of approximately $36.00 to $42.00, rounded to the nearest $1.00.

        The preparation of a fairness opinion is a complex process and is not necessarily susceptible to partial analysis or summary description. Selecting portions of the analyses or of the summary set forth above, without considering the analyses as a whole, could create an incomplete view of the processes underlying Goldman Sachs' opinion. In arriving at its fairness determination, Goldman Sachs considered the results of all of its analyses and did not attribute any particular weight to any factor or analysis considered by it. Rather, Goldman Sachs made its determination as to fairness on the basis of its experience and professional judgment after considering the results of all of its analyses. No company or transaction used in the above analyses as a comparison is directly comparable to HSNi or the QVC Group or the contemplated transaction.

        Goldman Sachs prepared these analyses for purposes of Goldman Sachs' providing its opinion to the Special Committee (with the other Qualified Directors present) as to the fairness from a financial point of view to the HSNi stockholders (other than the Liberty Interactive related entities and their respective affiliates), as of the date of the opinion, of the exchange ratio pursuant to the merger agreement. These analyses do not purport to be appraisals nor do they necessarily reflect the prices at which businesses or securities actually may be sold. Analyses based upon forecasts of future results are not necessarily indicative of actual future results, which may be significantly more or less favorable than suggested by these analyses. Because these analyses are inherently subject to uncertainty, being based upon numerous factors or events beyond the control of the parties or their respective advisors, none of HSNi, Liberty Interactive, Goldman Sachs or any other person assumes responsibility if future results are materially different from those forecast.

        The consideration to be paid by Liberty Interactive for each share of HSNi common stock pursuant to the merger agreement was determined through arm's-length negotiations between the Special Committee and Liberty Interactive and was recommended by the Special Committee and approved by the HSNi board. Goldman Sachs provided advice to the Special Committee during these negotiations. Goldman Sachs did not, however, recommend any specific exchange ratio to the Special Committee or the HSNi board or that any specific exchange ratio constituted the only appropriate exchange ratio for the merger.

        As described above, Goldman Sachs' opinion to the Special Committee was one of many factors taken into consideration by the Special Committee and the HSNi board in making their determination with respect to the merger agreement. The foregoing summary does not purport to be a complete description of the analyses performed by Goldman Sachs in connection with the fairness opinion and is qualified in its entirety by reference to the written opinion of Goldman Sachs attached as Annex D of this proxy statement/prospectus.

        Goldman Sachs and its affiliates are engaged in advisory, underwriting and financing, principal investing, sales and trading, research, investment management and other financial and non-financial

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activities and services for various persons and entities. Goldman Sachs and its affiliates and employees, and funds or other entities they manage or in which they invest or have other economic interests or with which they co-invest, may at any time purchase, sell, hold or vote long or short positions and investments in securities, derivatives, loans, commodities, currencies, credit default swaps and other financial instruments of HSNi, the Liberty Interactive related entities or any of their respective affiliates, or any currency or commodity that may be involved in the merger. Goldman Sachs acted as financial advisor to the Special Committee in connection with, and participated in certain of the negotiations leading to, the merger. Goldman Sachs has provided certain financial advisory and/or underwriting services to the entities referred to, solely for the purpose of Goldman Sachs' opinion, as "Liberty Interactive related entities" and/or their respective affiliates from time to time for which the Investment Banking Division of Goldman Sachs has received, and may receive, compensation, including having acted as financial advisor to Liberty Global plc, which is referred to in this summary of Goldman Sachs' opinion as Liberty Global and is a Liberty Interactive related entity, in connection with the issuance of Liberty Global's LiLAC Group Tracking Stock in July 2015; as financial advisor to Expedia, Inc., which is a subsidiary of Liberty Expedia (incorrectly identified as a subsidiary of Liberty Media in the fairness opinion) and is a Liberty Interactive related entity, in connection with its acquisition of HomeAway, Inc. in December 2015; as financial advisor to Telenet Group Holding N.V., a subsidiary of Liberty Global, in connection with its acquisition of BASE Company N.V. in February 2016; as financial advisor to Liberty Global in connection with its acquisition of Cable & Wireless Communications Plc in May 2016; as placement agent with respect to a private offering of 1.75% exchangeable senior debentures due 2046 (aggregate principal amount of $750,000,000) by Liberty Interactive in August 2016; as bookrunner with respect to a public offering by Ziggo Group Holding B.V., a subsidiary of Liberty Global, of its 6.000% senior notes due 2027 (aggregate principal amount of $625,000,000), its 5.500% senior secured notes due 2027 (aggregate principal amount of $2,000,000,000) and its 4.250% senior secured notes due 2027 (aggregate principal amount of €775,000,000) in September 2016; as a joint bookrunner in connection with the initial public offering of 30,026,635 American Depository Shares, representing 30,026,635 Class A shares, of Trivago N.V., which is a subsidiary of Expedia, Inc., (incorrectly identified as a subsidiary of Liberty Media in the fairness opinion) in December 2016; as bookrunner with respect to a dollar-denominated term loan refinancing (aggregate principal amount of $2,525,000,000) and a euro-denominated term loan refinancing (aggregate principal amount of €2,250,000,000) for VodafoneZiggo Group Holding B.V., which is an affiliate of Liberty Global, in January 2017; and as bookrunner in connection with a convertible financing (aggregate principal amount of $300,000,000) for LendingTree, which is a Liberty Interactive related entity, in May 2017. During the two-year period ended July 5, 2017, Goldman Sachs has received compensation for financial advisory and/or underwriting services provided by its Investment Banking Division to the Liberty Interactive related entities of approximately $45.5 million. Goldman Sachs may also in the future provide financial advisory and/or underwriting services to HSNi, the Liberty Interactive related entities and their respective affiliates for which the Investment Banking Division of Goldman Sachs may receive compensation.

        The Special Committee selected Goldman Sachs as its financial advisor because it is an internationally recognized investment banking firm that has substantial experience in transactions similar to the merger. Pursuant to a letter agreement dated June 23, 2017, the Special Committee engaged Goldman Sachs to act as its financial advisor in connection with the contemplated merger. The engagement letter between the Special Committee and Goldman Sachs provides for a transaction fee that is estimated, based on the information available as of the date of announcement, at approximately $20,000,000, $1,000,000 of which became payable upon the execution of the engagement letter, $1,000,000 of which became payable upon delivery of the opinion, and the reminder of which is contingent upon consummation of the merger. In addition, HSNi has agreed to reimburse Goldman Sachs for certain of its expenses, including attorneys' fees and disbursements, and to indemnify

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Goldman Sachs and related persons against various liabilities, including certain liabilities under the federal securities laws.

        To resolve certain concerns raised by Liberty Interactive about the aggregate transaction fees payable to Goldman Sachs and Centerview Partners by HSNi under their respective engagement letters in light of Liberty Interactive's existing significant equity interest in HSNi, Goldman Sachs and Centerview Partners orally advised Liberty Interactive that, to the extent they were engaged in the future to provide investment banking advisory services to Liberty Interactive or certain entities controlled by Liberty Interactive, each would provide, depending on the circumstances, a credit of up to $5,000,000 toward such engagement. The foregoing discussion did not include any commitment or agreement by Liberty Interactive to hire Goldman Sachs or Centerview Partners for future work or any commitment or agreement by Goldman Sachs or Centerview Partners to provide any future investment banking advisory services to Liberty Interactive or any other entity.

Interests of Certain Persons of HSNi in the Merger

        In considering the recommendation of the HSNi board with respect to the merger, HSNi stockholders should be aware that executive officers and non-employee directors of HSNi have certain interests in the merger that may be different from, or in addition to, the interests of HSNi stockholders generally. These interests include the following:

        The HSNi board includes two designees of Liberty Interactive—Ms. Chun and Mr. Costello. Ms. Chun serves as Senior Vice President of Investor Relations for Liberty Interactive and Liberty Media Corporation.

        Under the terms of the merger agreement, at the effective time, Liberty Interactive is required (i) to appoint one designee from the HSNi board, who will be chosen in Liberty Interactive's sole discretion (but who cannot be an HSNi director designated by Liberty Interactive pursuant to the Spinco Agreement), to the Liberty Interactive board at the effective time, and (ii) use its reasonable best efforts to cause such person to be elected to the Liberty Interactive board at the first annual meeting of the stockholders of Liberty Interactive following the effective time. See "—The Merger Agreement—Additional Covenants and Agreements" and "Certain Relationships and Related Party Transactions—Relationship Between HSNi and Liberty Interactive—Spinco Agreement" below.

        The merger agreement provides that Liberty Interactive will:

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        As described in more detail below under "—The Merger Agreement—Treatment of HSNi Stock Options and Other Equity-Based Awards in the Merger" at the effective time, all HSNi equity awards then held by non-employee directors and executive officers (and other employees) will convert into equity awards based on Liberty QVCA common stock. All such awards that are then unvested will continue to vest following the effective time in accordance with the terms, exercisability, vesting schedules and other provisions applicable to such awards. The vesting of such awards will accelerate on termination of the holder's employment or service by HSNi without "cause" or by the holder for "good reason" during the one-year period following the effective time. In the event of such termination, HSNi PSUs will be deemed earned based on the level of attainment of the applicable relative total stockholder return goal measured as of the date on which the holder's employment or service terminates or the date on which the effective time occurs, whichever produces the greater payout.

        For the estimated values of the potential accelerated vesting of the equity awards held by HSNi's executive officers on a qualifying termination of employment, see the "Equity" column of the table below under "—Golden Parachute Compensation."

        The table below sets forth the estimated values of the accelerated vesting of the non-employee directors' deferred stock units, assuming that the effective time had occurred on August 1, 2017 and that the directors' service was terminated without "cause" immediately thereafter. The values were calculated, in accordance with the applicable rules under Regulation S-K under the Exchange Act, by assuming a price per share of HSNi common stock of $37.64, which equals the average closing price of a share over the five business day period following the first public announcement of the merger.

Director
  Deferred
Stock Unit
Acceleration ($)
 

Courtnee Chun

    124,094  

William Costello

    124,094  

Fiona Dias

    124,094  

James M. Follo

    124,094  

Stephanie Kugelman

    124,094  

Arthur C. Martinez

    281,990  

Thomas J. McInerney

    124,094  

Matthew E. Rubel

    124,094  

Ann Sarnoff

    124,094  

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        Under the terms of the merger agreement, each executive officer (and each other bonus-eligible employee) is entitled to the annual bonus opportunities described below if the executive officer remains employed through the regular payment date or if, following the effective time and prior to such date, the executive officer's employment is terminated by HSNi without "cause" or by the executive officer for "good reason:"

        Each named executive officer (other than Ms. Grossman) was granted a performance cash award in 2015 that is scheduled to vest on December 31, 2017 based on the level of attainment of the applicable relative total shareholder return goal measured over the three-year period ending on such date. Under the terms of the award, if prior to December 31, 2017 the effective time occurs and the executive's employment is terminated by HSNi without "cause" or by the executive for "good reason," the award will vest and be paid in cash at the target level, as prorated to reflect the number of months during the performance period that the executive was employed. The amount of the payment will be reduced to reflect the time value of the earlier payment of the award based on the whole number of months between the first day of the month in which the effective time occurs and the scheduled vesting date, using the federal short-term rate determined pursuant to Section 1274 of the Code for the month in which the effective time occurs, compounded monthly. For the estimated values of these payments, see the "Cash" column of the table below under "—Golden Parachute Compensation."

        Each executive officer participates in the HSN, Inc. Named Executive Officer and Executive Vice President Severance Plan (the severance plan ). The severance plan was adopted in 2009 to formalize and standardize HSNi's severance practices for its most senior executive officers and was adopted in lieu of issuing new employment agreements.

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        Under the severance plan, each executive officer whose employment is terminated by HSNi without "cause" or by the executive officer for "good reason," in either case within the one-year period following the effective time, would be entitled to the payments and benefits, subject to the conditions and limitations, described below:

        For purposes of the equity awards, annual bonuses and severance plan, "cause" and "good reason" are defined as follows:

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        The table below sets forth for each of HSNi's named executive officers estimates of the amounts of compensation that are based on or otherwise relate to the merger and that will or may become payable to the named executive officer on a qualifying termination of employment following the merger (i.e., on a "double trigger" basis). None of the named executive officers would be entitled to any such compensation immediately at the effective time (i.e., on a "single trigger" basis). Mindy Grossman, who resigned as HSNi's Chief Executive Officer effective as of May 24, 2017, would not be entitled to any payments or benefits that are based on or otherwise relate to the merger.

        The HSNi stockholders are being asked to approve, on a non-binding, advisory basis, such compensation for these named executive officers. See "HSNi Proposals—HSNi Proposal 3: The Non-Binding Compensation Advisory Proposal." Because the vote to approve such compensation is advisory only, it will not be binding on either HSNi or Liberty Interactive. Accordingly, if the merger agreement is adopted by HSNi's stockholders and the merger is completed, the compensation will be payable regardless of the outcome of the vote to approve such compensation, subject only to the conditions applicable thereto, which are described in the footnotes to the table below and above in this section.

        The table also sets forth estimates of the amounts of such compensation for Rod R. Little, who is an executive officer of HSNi (but was not a named executive officer for calendar year 2016 due to his appointment in January 2017).

        The estimates in the table assume that the merger had become effective on August 1, 2017 and that the employment of each of the executive officers (other than Ms. Grossman) had been terminated

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immediately thereafter by HSNi without "cause" or by the executive officer for "good reason" (see the definitions above under "—Definitions of 'Cause' and 'Good Reason"').

Name
  Cash(1)
($)
  Equity(2)
($)
  Perquisites/
Benefits(3)
($)
  Total
($)
 

Named Executive Officers

                         

Mindy Grossman, Former Chief Executive Officer

    0     0     0     0  

Judy A. Schmeling, Chief Operating Officer, HSNi and President, Cornerstone Brands, Inc. 

    4,407,123     1,514,326     20,000     5,941,449  

William C. Brand, President, HSN and Chief Marketing Officer, HSNi

    3,139,053     1,097,072     20,000     4,256,125  

Gregory J. Henchel, Chief Legal Officer and Secretary

    2,098,684     632,766     20,000     2,751,450  

Maria D. Martinez, Chief Human Resources Officer

    1,507,392     450,602     20,000     1,977,994  

Other Executive Officer

                         

Rod R. Little, Chief Financial Officer and Interim Principal Executive Officer

    3,591,119     2,279,300     20,000     5,890,419  

(1)
The amounts in this column reflect the sum of the following cash payments that each executive officer (other than Ms. Grossman) would be entitled to receive on a "double trigger" basis on termination of employment by HSNi without "cause" or by the executive officer for "good reason" on the assumed termination date of August 1, 2017: (a) a lump sum severance payment (see above under "—Severance Plan"), (b) payment of a prorated portion of the target amount of the performance cash award that is scheduled to vest on December 31, 2017 (see above under "—Performance Cash Awards"), (c) for the period from January 1, 2017 through June 30, 2017, the annual bonus earned based on actual performance for such period, as prorated to reflect the number of days during such period (see above under "—Annual Bonuses—Bonus for First Half of 2017"), and (d) for the period from July 1, 2017 through the assumed termination date of August 1, 2017, 70% of the target annual bonus, as prorated to reflect the number of days during such period, which is the minimum amount that would be payable for such period (see above under "—Annual Bonuses—Bonus for Second Half of 2017").

(2)
Each of the executive officers (other than Ms. Grossman) holds unvested equity awards, the vesting of which would accelerate on a "double trigger" basis on termination of employment by HSNi without "cause" or by the executive officer for "good reason" on the assumed termination date of August 1, 2017 (see above under "—Equity Awards"). The amounts in this column reflect the value of such accelerated vesting. The amounts were calculated, in accordance with the applicable rules under Regulation S-K under the Exchange Act, by assuming a price per share of HSNi common stock of $37.64, which equals the average closing price of a share over the five business day period following the first public announcement of the merger.

(3)
The amounts in this column reflect outplacement services that each of the executive officers (other than Ms. Grossman) would be entitled to receive on a "double trigger" basis on termination of employment by HSNi without "cause" or by the executive for "good reason" on the assumed termination date of August 1, 2017 (see above under "—Severance Plan").

Effect of the Merger on HSNi Stockholders; What HSNi Stockholders Will Receive in the Merger

        HSNi stockholders (other than Liberty Interactive and its wholly owned subsidiaries) will receive the exchange ratio of 1.650 shares of Liberty QVCA common stock for each share of HSNi common stock held as of the effective time, which represents approximately $40.36 in shares of Liberty QVCA common stock-based on the closing price of shares of Liberty QVCA common stock on July 5, 2017, the last trading day before the public announcement of the execution of the merger agreement, and

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$36.55 in shares of Liberty QVCA common stock-based on the closing price of Liberty QVCA common stock on August 28, 2017, the last practicable date prior to the filing of this proxy statement/prospectus. Each share of HSNi common stock held by Liberty Interactive or any of its wholly owned subsidiaries will be converted into one validly issued, fully paid and non-assessable share of common stock of the surviving corporation.

        Based upon the number of outstanding shares of HSNi common stock on the HSNi record date, and on the number of shares of capital stock of Liberty Interactive outstanding on the HSNi record date, it is expected that (i) Liberty Interactive will issue [     ·     ] shares of Liberty QVCA common stock in the merger, (ii) Liberty Interactive will reserve approximately [     ·     ] shares of HSNi common stock for issuance in respect of HSNi equity awards that Liberty Interactive will assume in the merger as described below, and (iii) former HSNi stockholders (excluding Liberty Interactive and any of its wholly owned subsidiaries) will own approximately [     ·     ]% of the undiluted equity of the QVC Group and [     ·     ]% of the undiluted voting power of the QVC Group. Additionally, HSNi stockholders are expected to own approximately 6.0% of the undiluted voting power of Liberty Interactive as a whole, taking into account the outstanding shares of the Ventures Group tracking stock as of July 31, 2017. See "Summary—The Companies—Liberty Interactive Corporation" for a discussion of Liberty Interactive's tracking stock structure.

        Certain rights pertaining to Liberty QVCA common stock to be received by the HSNi stockholders will be different from the rights pertaining to shares of HSNi common stock. A description of the rights pertaining to Liberty QVCA common stock is included under "Comparison of Stockholders' Rights."

Amount and Source of Funds and Financing of the Merger; Expenses

        Pursuant to the terms of the merger agreement, each party agreed to pay its own expenses in connection with the merger, except that any expenses incurred by HSNi in connection with the solicitation of certain consents and amendments to its credit agreement in accordance with the merger agreement are subject to reimbursement by Liberty Interactive upon certain termination events set forth in the merger agreement.

Accounting Treatment

        Liberty Interactive will account for the merger under the acquisition method of accounting for business combinations in accordance with GAAP.

Regulatory Approvals

    General

        The parties' respective obligations to consummate the merger are conditioned upon, among other things, (i) the absence of any judgment, order, writ or award entered, enacted, promulgated, enforced or issued by any court or other governmental authority of competent jurisdiction which prohibits, renders illegal or permanently enjoins the consummation of the merger, (ii) the expiration or termination of any waiting period applicable to the consummation of the merger under the HSR Act and (iii) the effectiveness under the Securities Act of the registration statement on Form S-4 of which this proxy statement/prospectus forms a part, with no stop order or proceeding seeking a stop order having been initiated by the SEC. In addition, Liberty Interactive's obligation to effect the merger is conditioned upon the approval of the FCC of applications for transfer of control and/or assignment of certain FCC licenses, authorizations and registrations.

        Liberty Interactive and HSNi have each agreed to use reasonable best efforts to take, or cause to be taken, all actions, and to do, or cause to be done, and to assist and cooperate with the other parties in doing, all things, necessary, proper or advisable to consummate and make effective, in the most

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expeditious manner practicable, the merger, including preparing and filing as soon as practicable all applications, forms, registrations and notices required to be filed prior to the consummation of the merger and the taking of any actions as are reasonably necessary to obtain any requisite approvals, consents, orders, exemptions or waivers from any governmental authority or other third party required to be obtained prior to the consummation of the merger, including pursuant to the HSR Act, FCC requirements or as required in relation to any antitrust, trade, competition, or other regulatory matters. Liberty Interactive and HSNi have also agreed to take all reasonable actions necessary to resolve any objection asserted under any domestic or foreign competition or antitrust law or any communications law, or any action asserted by any governmental authority objecting to the merger. However, neither Liberty Interactive nor HSNi will be obligated to, consent to or agree to hold separate or otherwise dispose of, restrict, operate, invest or otherwise change, its respective assets or business in any manner that, individually or in the aggregate, (i) materially adversely affects the financial condition, business or operations of (x) HSNi and its subsidiaries or (y) QVC and zulily, and their respective subsidiaries, on a consolidated and post-closing basis, or (ii) prohibits or materially limits the ownership, control or operation by (x) HSNi and its subsidiaries or (y) QVC and zulily, and their respective subsidiaries, of any material portion of its or their respective businesses or assets, or compels Liberty Interactive (with respect to the QVC Group only) or HSNi to dispose of or hold separate any material portion of its business or assets.

        There can be no assurances that all of the regulatory approvals necessary to consummate the merger and described herein will be obtained and, if obtained, there can be no assurances as to the timing of any approvals, Liberty Interactive's and HSNi's ability to obtain the approvals on satisfactory terms or the absence of any litigation challenging such approvals. For more information, see "Risk Factors" above.

    Securities and Exchange Commission

        In connection with the issuance of shares of Liberty QVCA common stock in the merger, Liberty Interactive must file a registration statement with the SEC under the Securities Act, of which this proxy statement/prospectus forms a part, and it is a condition to the merger that such registration statement has become effective under the Securities Act, and that no stop order has been issued or initiated by the SEC and not rescinded.

    Federal Communications Commission

        HSNi, through multiple subsidiaries, holds satellite earth station authorizations, low-power television licenses, and business radio licenses issued by the FCC, the transfer of control of which requires the prior approval of the FCC. On July 18, 2017, the parties filed applications seeking the FCC's consent to transfer control of the FCC licenses and authorizations in connection with the merger. On July 24 and 26, 2017, the FCC issued public notices on the low-power television and satellite earth station applications, respectively. Also on July 26, 2017, the FCC consented to the transfer of HSNi's business radio licenses. The deadlines to file petitions to deny the low-power television and satellite earth station applications passed on August 23 and August 25, 2017, respectively, and no petitions to deny were filed.

    HSR Act

        The merger is subject to the requirements of the HSR Act, which provides that certain transactions may not be completed until required information and materials are furnished to the Antitrust Division of the Department of Justice (the DOJ ), and the Federal Trade Commission (the FTC ), and until certain waiting period requirements have been satisfied. Each of HSNi and Liberty Interactive filed a Pre-merger Notification and Report Form under the HSR Act with the DOJ and the

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FTC in connection with the merger effective July 28, 2017. The waiting period expired at 11:59 p.m., Eastern Time, on August 28, 2017.

        The DOJ, the FTC, state attorneys general, and others may challenge the merger on antitrust grounds after the expiration or termination of the applicable waiting period. Accordingly, at any time before or after the completion of the merger, any of the DOJ, the FTC or others could take action under the antitrust laws, including without limitation seeking to enjoin the completion of the merger or permitting completion subject to regulatory concessions or conditions. Neither HSNi nor Liberty Interactive believes that the merger violates U.S. antitrust laws, but there can be no assurance that a challenge to the merger on antitrust grounds will not be made or, if such a challenge is made, that it would not be successful.

No Appraisal Rights

        In accordance with Section 262 of the DGCL, HSNi stockholders will not have appraisal rights in connection with the merger.

The Merger Agreement

        This section summarizes material provisions of the merger agreement. This summary does not purport to be complete and may not contain all of the information about the merger agreement that is important to you. This summary is subject to, and qualified in its entirety by reference to, the merger agreement, which is attached as Annex A to this proxy statement/prospectus and is incorporated by reference into this proxy statement/prospectus. The rights and obligations of the parties are governed by the express terms and conditions of the merger agreement and not by this summary or any other information contained in this proxy statement/prospectus. You are urged to read the merger agreement carefully and in its entirety before making any decisions regarding the merger agreement and the merger.

        This summary of the merger agreement is included in this proxy statement/prospectus only to provide you with information regarding the terms and conditions of the merger agreement, and not to provide any other factual information about Liberty Interactive or HSNi or their respective subsidiaries or businesses. Accordingly, the representations and warranties and other provisions of the merger agreement should not be read alone, but instead should be read together with the information provided elsewhere in this proxy statement/prospectus and in the documents incorporated by reference into this proxy statement/prospectus. For more information, see "Additional Information—Where You Can Find More Information."

        The representations, warranties and covenants set forth in the merger agreement and described in this proxy statement/prospectus were made only for purposes of the merger agreement, were made as of specific dates and may be subject to more recent developments, were made solely for the benefit of the parties to the merger agreement and may be subject to limitations agreed upon by the contracting parties, including being qualified by reference to confidential disclosures, were made for the purposes of allocating contractual risk between the parties to the merger agreement instead of establishing these matters as facts, and may apply standards of materiality in a way that is different from what may be viewed as material by you or other investors. The representations and warranties set forth in the merger agreement do not, with certain exceptions, survive the effective time of the merger. Investors should not rely on the representations, warranties and covenants or any description thereof as characterizations of the actual state of facts or conditions of Liberty Interactive, HSNi or any of their respective subsidiaries or affiliates. Moreover, information concerning the subject matter of the representations, warranties and covenants set forth in the merger agreement may change after the date of the merger agreement, which subsequent information may or may not be fully reflected in public disclosures by Liberty Interactive or HSNi.

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    Form of the Merger

        Pursuant to the merger agreement, at the effective time, Merger Sub will merge with and into HSNi, with HSNi continuing as the surviving corporation and becoming a wholly owned subsidiary of Liberty Interactive.

    Consideration to HSNi Stockholders in the Merger

        HSNi stockholders (other than Liberty Interactive and its wholly owned subsidiaries) will receive the exchange ratio of 1.650 shares of Liberty QVCA common stock for each share of HSNi common stock held as of the effective time, which represents approximately $40.36 in shares of Liberty QVCA common stock-based on the closing price of shares of Liberty QVCA common stock on July 5, 2017, the last trading day before the public announcement of the execution of the merger agreement, and $36.55 in shares of Liberty QVCA common stock-based on the closing price of Liberty QVCA common stock on August 28, 2017, the last practicable date prior to the filing of this proxy statement/prospectus. Each share of HSNi common stock held by Liberty Interactive or any of its wholly owned subsidiaries will be converted into one validly issued, fully paid and non-assessable share of common stock of the surviving corporation.

        No fractional shares of Liberty QVCA common stock will be issued in the merger. To the extent that the merger would result in any HSNi stockholder being issued a fractional share, such HSNi stockholder will instead receive a cash payment in an amount based on the aggregation and sale of all fractional shares by the exchange agent at prevailing market prices on behalf of such HSNi stockholders. Amounts payable in lieu of such fractional shares will be payable from the proceeds of the aggregation and sale of the fractional shares as soon as practicable following the effective time. No HSNi stockholder will be entitled to dividends, voting rights or any other rights with respect to any fractional shares.

        Certain rights pertaining to Liberty QVCA common stock to be received by the HSNi stockholders will be different from the rights pertaining to shares of HSNi common stock. A description of the rights pertaining to Liberty QVCA common stock is included under "Comparison of Stockholders' Rights."

        For more information, see "Information About the Merger—The Merger Agreement—Exchange of Shares in the Merger."

    Treatment of HSNi Stock Options and Other Equity-Based Awards in the Merger

        At the effective time of the merger, upon the terms and subject to the conditions of the merger agreement, outstanding equity awards with respect to shares of HSNi common stock granted by HSNi to employees and non-employee directors will be adjusted as follows:

    Stock Options.   At the effective time, each HSNi stock option that is outstanding as of immediately prior to the effective time, whether vested or unvested, will be converted into an option to purchase a number of shares of Liberty QVCA common stock (rounded down to the nearest number of whole shares) equal to the product of (i) the number of shares of HSNi common stock subject to such HSNi stock option immediately prior to the effective time of the merger and (ii) the exchange ratio, rounded down to the nearest whole share, at an exercise price per share determined by dividing the per-share exercise price of the HSNi stock option immediately prior to the effective time of the merger by the exchange ratio (rounding the resulting quotient up to the nearest whole cent). Any restrictions applicable to the exercise of the HSNi stock options will continue in full force and effect following such adjustment and the terms, exercisability, vesting schedules and other provisions will remain unchanged.

    Stock Appreciation Rights.   At the effective time, each HSNi SAR that is outstanding as of immediately prior to the effective time, whether vested or unvested, will be converted into a

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      stock appreciation right with respect to a number of shares of Liberty QVCA common stock equal to the product of (i) the number of shares of HSNi common stock subject to such HSNi SAR immediately prior to the effective time of the merger and (ii) the exchange ratio, rounded down to the nearest whole share, at an exercise price per share determined by dividing the exercise price of such HSNi SAR immediately prior to the effective time by the exchange ratio (rounding the resulting quotient up to the nearest whole cent). Any restrictions applicable to the exercise of the HSNi SARs will continue in full force and effect following such adjustment and the terms, exercisability, vesting schedules and other provisions will remain unchanged.

    Restricted Stock Units.   At the effective time, each HSNi RSU that is outstanding as of immediately prior to the effective time of the merger, that is subject to time-based vesting, will be converted into an award of restricted stock units with respect to a number of shares of Liberty QVCA common stock equal to the product of (i) the number of shares of HSNi common stock subject to such HSNi RSU immediately prior to the effective time of the merger and (ii) the exchange ratio, rounded to the nearest whole share. Any vesting conditions and restrictions on the receipt of any HSNi RSUs will continue in full force and effect following such adjustment and the terms, vesting schedules and other provisions will remain unchanged.

    Performance Share Units.   At the effective time, each HSNi PSU that is outstanding as of immediately prior to the effective time of the merger will be converted into an award of performance share units with respect to a target number of shares of Liberty QVCA common stock equal to the product of (i) the target number of shares of HSNi common stock subject to such HSNi PSU immediately prior to the effective time of the merger and (ii) the exchange ratio, rounded to the nearest whole share. Any vesting conditions and restrictions on the receipt of any HSNi PSUs will continue in full force and effect following such adjustment and the terms, vesting schedules and other provisions will remain unchanged.

        Each adjusted HSNi stock option, HSNi SAR, HSNi RSU and HSNi PSU will be subject to further adjustment to reflect any stock split, division, consolidation, reclassification, recapitalization or similar transaction with respect to shares of Liberty QVCA common stock. In addition, each adjusted HSNi stock option, HSNi SAR, HSNi RSU and HSNi PSU will be subject to the authority of the compensation committee of the Liberty Interactive board and Liberty Interactive's equity compensation administrative procedures.

    Closing: Effective Time of the Merger

        Unless the merger agreement shall have been terminated in accordance with its terms, and subject to certain other conditions set forth in the merger agreement, the closing of the merger will occur as promptly as practicable (but in no event later than the second business day) after all of the conditions to the merger have been satisfied or waived by the party entitled to the benefit of the same (other than the conditions which by their terms are required to be satisfied or waived at the closing of the merger, but subject to the satisfaction or waiver of such conditions) (the date on which the closing occurs, or at such other time and on a date as agreed to by the parties in writing, the