Orbitz 2008 Annual Report Download - page 26

liability. Security breaches could also cause customers and potential customers to lose confidence in our security, which would have a negative effect on the
demand for our products and services.
Moreover, public perception concerning security and privacy on the Internet could adversely affect customers' willingness to use our websites. A publicized
breach of security, even if it only affects other companies conducting business over the Internet, could inhibit the growth of the Internet and, therefore, our
services as a means of conducting commercial transactions.
Travelport's controlling holders control us and may have strategic interests that differ from ours or our public shareholders.
Travelport and investment funds that own and/or control Travelport's ultimate parent company currently own approximately 58% of our outstanding
common stock. As a result of this ownership, Travelport's controlling holders are entitled to elect all or substantially all of our directors, to appoint new
management and to determine the outcome of actions requiring the approval of our stockholders, including adopting most amendments to our certificate of
incorporation and approving or rejecting proposed mergers or sales of all or substantially all of our assets. Through their control of the ultimate parent of
Travelport, Travelport's controlling holders indirectly control us and all of our subsidiaries.
The interests of Travelport's controlling holders may differ from those of our public shareholders in material respects. For example, Travelport's controlling
holders and their affiliates are in the business of making investments in companies. They currently have, and may from time to time in the future acquire,
interests in businesses that directly or indirectly compete with certain portions of our business or our suppliers or customers of ours. In addition, Travelport's
controlling holders, either through Travelport, one of its subsidiaries or other unrelated entities, may also pursue acquisition opportunities that may be
complementary to our business and, as a result, those acquisition opportunities may not be available to us. So long as investment funds associated with or
designated by Travelport's controlling holders continue to indirectly own a significant amount of the outstanding shares of our common stock, even if such
amount is less than 50%, Travelport's controlling holders will continue to be able to strongly influence or effectively control our decisions. The interests of these
holders may differ from our public shareholders' interests in material respects.
Our certificate of incorporation and separation agreement with Travelport limit our ability to engage in many transactions without the consent of Travelport.
Our certificate of incorporation and separation agreement with Travelport provide Travelport with a greater degree of control and influence in the operation
of our business and the management of our affairs than is typically available to stockholders of a publicly-traded company. Certain of these controls relate to our
status as a restricted subsidiary under Travelport's indentures because, as a restricted subsidiary, our actions can cause a breach of the covenants under
Travelport's indentures. Also, the agreements governing the indebtedness of Travelport restrict Travelport's ability to, among other things, permit us to incur
indebtedness and restrict our ability to apply the proceeds of any equity offering. Until Travelport ceases to beneficially own shares entitled to 33% or more of
the votes entitled to be cast by the holders of our then outstanding common stock, the prior consent of Travelport is required for:
•
any consolidation or merger of us or any of our subsidiaries with any person, other than a subsidiary;
•
any sale, lease, exchange or other disposition or any acquisition or investment, other than certain permitted investments, by us, other than
transactions between us and our subsidiaries, or any series of related dispositions or acquisitions, except for those for which we give
Travelport at least 15 days prior written notice and which involve consideration not in excess of $15 million in fair market value, except
(1) any disposition of cash equivalents or investment grade securities or
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Source: Orbitz Worldwide, In, 10-K/A, August 28, 2008