Business Context and Reporting Period
This Form 8-K was filed by Expedia, Inc. on July 8, 2005. The report details the entry into a material definitive agreement and the creation of a direct financial obligation. The filing is contingent upon the completion of the Company's spin-off from IAC/InterActiveCorp.
Key Financial Metrics
- Debt Facility: Entered into a new unsecured $1 billion, five-year revolving credit facility.
- Borrowers: Expedia, Inc. (Delaware), Expedia, Inc. (Washington), Travelscape, Inc., Hotels.com, and Hotwire, Inc.
- Agents: JPMorgan Chase Bank, N.A. (Administrative Agent); Bank of America, N.A. (Syndication Agent); Wachovia Bank, N.A. and The Royal Bank of Scotland PLC (Co-Documentation Agents).
- Revenue, Profit, Cash Flow, Margins, Liquidity: The filing text does not provide specific values for revenue, profit, cash flow, margins, or existing liquidity positions.
Material Changes
The primary material change is the establishment of the $1 billion revolving credit facility. This facility is intended for general corporate purposes. The obligation of lenders to fund loans is subject to the condition that the Company completes its spin-off from IAC/InterActiveCorp.
Guidance, Outlook, and Risks
Management Commentary: The facility is designated for general corporate purposes. The full terms are detailed in the Credit Agreement attached as Exhibit 10.1.
Risks and Contingencies: The primary contingency is the successful completion of the spin-off from IAC/InterActiveCorp. Without this completion, the lenders' obligation to make loans may not be triggered.
Investor Verification Checklist
- Verify the status of the spin-off from IAC/InterActiveCorp to confirm the credit facility is active.
- Review Exhibit 10.1 (Credit Agreement) for specific interest rates, covenants, and repayment terms not detailed in the summary.
- Confirm the specific roles and liabilities of the various subsidiary borrowers (Travelscape, Hotels.com, Hotwire).