Orbitz 2010 Annual Report Download - page 114

The agreement included a termination clause in the event of certain changes in control. In December
2007, Travelport completed the sale of Tecnovate to an affiliate of Blackstone, Intelenet Global Services
(“Intelenet”), which qualified as a change in control under the termination clause. Prior to the sale, Travelport
paid us an incentive fee of $5 million for entering into an amended service agreement to continue using the
services of Tecnovate. We deferred the incentive fee and recognize it as a reduction to expense on a straight-
line basis over the original three-year term of the agreement.
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, in 2007, we recorded a $2 million capital contribution from Travelport in our consolidated balance
sheet.
Related Party Transactions with Affiliates of Blackstone and TCV
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 management companies that are
affiliates of Blackstone and that provide us with access to their inventory. We also purchase services from
certain Blackstone and TCV affiliates such as telecommunications and advertising. We have also entered into
various outsourcing agreements with Intelenet, an affiliate of Blackstone, that provide us with call center and
telesales, back office administrative, information technology and financial services. In addition, various
Blackstone and TCV affiliates utilize our partner marketing programs and corporate travel services.
The following table summarizes the related party balances with affiliates of Blackstone and TCV as of
December 31, 2009 and December 31, 2008, reflected in our consolidated balance sheets:
December 31, 2009 December 31, 2008
(in millions)
Accounts payable .................................. $5 $ 5
Accrued expenses .................................. 2 1
Accrued merchant payable ........................... 6 —
The following table summarizes the related party transactions with affiliates of Blackstone and TCV for
the years ended December 31, 2009, December 31, 2008 and December 31, 2007, reflected in our consolidated
statements of operations:
2009 2008 2007
Years Ended December 31,
(in millions)
Net revenue ...................................... $17 $14 $12
Cost of revenue(b) ................................. 26 30 —
Selling, general and administrative expense(c) . . . .......... 3 5 1
Marketing expense ................................. — — 1
(b) These amounts shown represent call center and telesales costs incurred under our outsourcing agreements
with Intelenet.
(c) Of the amounts shown for the years ended December 31, 2009, December 31, 2008 and December 31,
2007, $3 million, $5 million and $0, respectively, represent costs incurred under our outsourcing agree-
ments with Intelenet for back office administrative, information technology and financial services.
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ORBITZ WORLDWIDE, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)