Business Context and Reporting Period
This Form 8-K Current Report was filed by Expedia, Inc. on April 5, 2006. The filing discloses material changes in executive leadership, specifically the appointment of a new Chief Financial Officer and the resignation of the incumbent.
Key Financial Metrics
The filing text does not provide a clear value for revenue, profit, cash flow, margins, debt, or liquidity. This report focuses exclusively on executive compensation and personnel changes rather than financial performance metrics.
Material Changes
- Appointment: Michael Adler was appointed Chief Financial Officer, effective May 15, 2006. He will serve as Executive Vice President of Finance prior to that date.
- Resignation: Mark S. Gunning resigned as Executive Vice President and CFO, effective May 15, 2006.
- Compensation Package for New CFO:
- Annual base salary: $375,000.
- Target annual bonus: 60% of base salary.
- Signing bonus: $250,000.
- Restricted Stock Units (RSUs): Grant-date value of $2.6 million, vesting over five years.
- Acceleration Clauses: 100% of RSUs vest immediately upon a change of control; $800,000 of RSUs vest upon termination without cause or resignation for good reason.
Guidance, Outlook, and Risks
The filing text does not provide a clear value for financial guidance, outlook, or specific risk factors beyond the standard employment agreement terms. The document notes a two-year non-compete covenant for the new CFO following termination of employment.
Investor Verification Checklist
- Verify the transition timeline for the CFO role between May 15, 2006, and the interim period.
- Confirm the total equity grant value ($2.6 million) and its impact on future dilution.
- Review the specific definitions of "good reason" and "cause" in the new CFO's employment agreement regarding the $800,000 accelerated vesting provision.
- Assess the potential financial impact of the $250,000 signing bonus and $375,000 base salary on near-term operating expenses.