Orbitz 2008 Annual Report Download - page 117

ORBITZ WORLDWIDE, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
16. Related Party Transactions (Continued)
and continues to pay us fees for related maintenance and support services. The licenses include our supplier link technology; portions of ebookers' booking,
search and dynamic packaging technologies; certain of our products and online booking tools for corporate travel; portions of our white label dynamic packaging
technology; and our extranet supplier connectivity function currently being developed as part of our global technology platform.
The Master License Agreement granted us the right to use a corporate online booking product that Travelport was developing at the time we entered into the
agreement. The development of this product is now complete, and we are negotiating a value added reseller license with Travelport for this product. We paid a
one-time fee for this license.
Equipment, Services and Use Agreements
Prior to our IPO, we shared office locations with Travelport in twelve locations worldwide. In connection with our IPO, we separated the leasehold
properties based upon our respective business operations and assigned a leasehold interest where one company had exclusive use or occupation of a property.
We also entered into an Equipment, Services and Use Agreement for each office occupied by both parties. This agreement commenced in most locations on
June 1, 2007 and provided that the cost of the shared space would be ratably allocated. The agreement expired on December 31, 2007 but automatically renewed
for an additional one-year term if no termination notice was served. Termination notices were served at five of the twelve locations in 2007.
Travelport remained liable to landlords for all lease obligations with guarantee agreements, unless expressly released from this liability by the relevant
landlord. See "Separation Agreement" above for information as to the guarantees and letters of credit issued on our behalf by Travelport.
GDS Service Agreements
Certain of our subsidiaries had subscriber services agreement with Galileo, a subsidiary of Travelport. Under these agreements, Galileo provided us GDS
services and paid us an incentive payment for each segment processed using its GDS services.
In connection with our IPO, we entered into a new agreement with Travelport to use GDS services provided by both Galileo and Worldspan. The new
agreement replaced the former Galileo agreement discussed above as well as a GDS contract we had with Worldspan (see Note 9—Unfavorable Contracts). The
new agreement became effective in July 2007 with respect to GDS services provided by Galileo. In August 2007, upon completion of Travelport's acquisition of
Worldspan, the new agreement became effective for GDS services provided by Worldspan. This agreement expires on December 31, 2014.
The new Travelport GDS service agreement is structured such that we receive an incentive payment for each segment that is processed through Galileo or
Worldspan. The agreement also required us to process 33 million segments during 2007, 16 million segments through Worldspan and 17 million segments
through Galileo. The required number of segments processed in future years for Worldspan remains fixed at 16 million segments, while the required number of
segments for Galileo is subject to adjustment based upon the actual segments processed in the preceding year. In 2008, we are required to process approximately
22 million segments through Galileo. Our failure to process the
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Source: Orbitz Worldwide, In, 10-K/A, August 28, 2008