Orbitz 2008 Annual Report Download - page 119

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ORBITZ WORLDWIDE, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
16. Related Party Transactions (Continued)
incentive fee of $5 million for entering into an amended service agreement to continue using the services of the ISO. We deferred the incentive fee and recognize
it as a reduction to expense on a straight-line basis over the term of the agreement, which expires in 2010.
Financial Advisory Services Agreement
On July 16, 2007, we completed the sale of an offline U.K. travel subsidiary. Pursuant to an agreement between Travelport and Blackstone, Blackstone
provided financial advisory services to Travelport and to us in connection with certain business transactions, including dispositions. Under the terms of that
agreement, Travelport paid $2 million to Blackstone on our behalf for advisory services upon completion of the sale. As a result, we recorded a $2 million capital
contribution from Travelport in our consolidated balance sheet.
Related Party Transactions with Blackstone, TCV and Affiliates
The following table summarizes the related party balances with Blackstone, TCV and their affiliates as of December 31, 2007 and 2006, reflected in our
consolidated balance sheets:
Successor
December 31, 2007
December 31, 2006
(in millions)
Accounts payable $ 1 $ 1
The following table summarizes the related party transactions with Blackstone, TCV and their affiliates for the year ended December 31, 2007 and for the
period from August 23, 2006 to December 31, 2006, reflected in our consolidated statements of operations:
Year Ended
December 31, 2007
Successor
Period from
August 23, 2006 to
December 31, 2006
Successor
(in millions)
Net revenues $ 12 $ 5
Selling, general and administrative 1 —
Marketing 1 —
Service Agreement with Tecnovate
As discussed above, an affiliate of Blackstone acquired Tecnovate, an ISO. In connection with the change in ownership, we entered into an amended service
agreement. Tecnovate provides us with call center and telesales, back office administrative, information technology and financial services. The current hourly
billing rate for the services is based on cost plus a predetermined percentage. Our agreement is currently scheduled to expire in September 2010.
Other Agreements
In the normal course of conducting business, we have entered into various agreements with affiliates of Blackstone and TCV. We believe that these
agreements have been executed on terms comparable to those of unrelated third parties. For example, we have agreements with certain hotel
112
Source: Orbitz Worldwide, In, 10-K/A, August 28, 2008