Document/Exhibit Description Pages Size
1: 8-K Current Report 6 31K
2: EX-2.2 Plan of Acquisition, Reorganization, Arrangement, 3 11K
Liquidation or Succession
3: EX-2.3 Plan of Acquisition, Reorganization, Arrangement, 35 126K
Liquidation or Succession
4: EX-12.1 Statement re: Computation of Ratios 2± 11K
5: EX-23.1 Consent of Experts or Counsel 1 7K
6: EX-99.1 Miscellaneous Exhibit 41 245K
7: EX-99.2 Miscellaneous Exhibit 14 87K
8: EX-99.3 Miscellaneous Exhibit 8 45K
_______________________________________________________________________________
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
JULY 16, 2001
DATE OF REPORT (JULY 2, 2001)
SABRE HOLDINGS CORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
DELAWARE 1-12175 75-2662240
(STATE OR OTHER JURISDICTION (COMMISSION FILE NO.) (IRS EMPLOYER
OF INCORPORATION) IDENTIFICATION NO.)
4255 AMON CARTER BLVD.
FORT WORTH, TEXAS 76155
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (817) 963-6400
NOT APPLICABLE
(FORMER NAME OR FORMER ADDRESS, IF CHANGED SINCE LAST REPORT.)
_______________________________________________________________________________
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS
On March 14, 2001, Sabre Holdings Corporation and its wholly-owned subsidiary
Sabre Inc. (collectively, the "Company") entered into agreements with
Electronic Data Systems Corporation ("EDS") which provide for (i) the sale of
the Company's infrastructure outsourcing business and information technology
("IT") infrastructure assets and associated real estate to EDS (the "Asset
Purchase Agreement"), (ii) a 10-year contract with EDS to manage the Company's
IT systems (the "IT Outsourcing Agreement"), and (iii) agreements between the
Company and EDS to jointly market IT services and software solutions to the
travel and transportation industries (the "Marketing Agreements").
Effective on July 1, 2001, the Company and EDS completed the sale of the
Company's infrastructure outsourcing contracts, web hosting contracts, and IT
infrastructure assets and related real estate to EDS for approximately $661
million in cash, pursuant to the Asset Purchase Agreement. Up to approximately
$31 million of the sale proceeds is contingently refundable to EDS based, in
part, upon the amount of revenues received by EDS from US Airways under an
outsourcing contract during the 30 months following the close of the
transaction. In addition, the Company may receive aggregate additional
payments from EDS for these assets ranging from $6 million to $25 million on
April 15, 2003 and 2004, depending on the amount of revenues received by EDS
under certain other airline outsourcing contracts. The Company used the entire
$661 million of the cash proceeds from the sale to reduce existing debt.
The assets transferred included the Company's: outsourcing contracts with
American, US Airways, Gulf Air, and Dollar/Thrifty Rent-A-Car; and its data
centers, network and desktop and mid range computer systems. These assets were
used for the Company's outsourcing business and for transaction processing in
its travel marketing and distribution segment, including the operation of the
Sabre(R) global distribution system ("SABRE system"). Approximately 4,000 of
the Company's employees, located mostly in the United States, were transitioned
to employment with EDS upon closing of the transaction.
The Company retained its core travel marketing and distribution business,
including: the line of business related to contracts with travel suppliers and
travel agency subscribers for participation in the Sabre system; the Company's
investment in the Travelocity.com(SM) consumer on-line business and GetThere(TM)
corporate on-line booking business; and contracts with travel suppliers, travel
agencies and online travel sites for Web site development and booking engine
services. The Company plans to continue to focus its business on remaining the
global leader in all channels of travel distribution.
The Company also retained contracts and assets that are directly related to its
core travel marketing and distribution business. Those include its multihost
business, which provides internal reservation systems for airline customers;
contracts to provide software applications development, maintenance and
licensing; the Company's intellectual property assets, including its software
applications portfolios; and the eMergo(TM) suite of airline solutions offered
by the Company as an online application service provider.
Under the IT Outsourcing Agreement, EDS will provide, manage and operate the
Company's IT infrastructure, including data center management, applications
hosting, selected applications development, data assurance, and network
management services. The term of the IT Outsourcing Agreement is 10 years. The
Outsourcing Agreement is expected to generate future cost savings for the
Company.
Under the Marketing Agreements, the Company and EDS will jointly market certain
IT services and software solutions to the travel and transportation industries.
As part of the marketing relationship, EDS will contribute $20 million toward
enhancing and promoting the Company's portfolio of airline software solutions.
EDS has also agreed to move its travel bookings to the Company's Sabre system
and to implement the Company's GetThere corporate booking platform in its
organization.
2
CAUTIONARY NOTICE ABOUT FORWARD-LOOKING STATEMENTS
Statements in this report, and in the Company's news releases, analyst
newsletters, conference calls, web sites, and elsewhere, which are not purely
historical facts, including statements about the EDS transaction, the unaudited
pro forma condensed consolidated financial statements, the Company's forecasted
revenues and earnings, future bookings outlook, technology adoption rates, or
other statements about the Company's anticipations, beliefs, expectations,
hopes, intentions or strategies for the future, may be forward-looking
statements within the meaning of Section 21E of the Securities Exchange Act of
1934, as amended. Readers are cautioned not to place undue reliance on
forward-looking statements.
All forward-looking statements are based upon information available to the
Company on the date the statements are first published. The Company undertakes
no obligation to publicly update or revise any forward-looking statements,
whether as a result of new information, future events or otherwise.
Any forward-looking statements involve risks and uncertainties that could cause
actual events or results to differ materially from the events or results
described in the forward-looking statements, including risks or uncertainties
related to: integration and migration of IT operations by the Company and EDS;
competition from established and emerging travel distribution channels; travel
agency consolidation and increased competition for travel agency subscribers;
airlines limiting their participation in travel marketing and distribution
services; changes in relationships with principal customers; rapid
technological changes; systems failures or constraints and business
interruptions; and revenues being highly dependent on the travel and
transportation industries.
Further information regarding factors that could affect the Company's financial
and other results can be found in the risk factors section included in Exhibit
Number 99.2.
3
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
Commencing with the first quarter 2001, the Company began reporting the
historical operations of the information technology infrastructure
outsourcing business ("Outsourcing Business") as a discontinued operation
because of the then pending sale to EDS. With the completion of the sale
effective on July 1, 2001, the results of operations of the Outsourcing
Business included in the consolidated statements of operations for the years
ended December 31, 2000, 1999 and 1998 and the related notes thereto have
been revised for discontinued operations. The Management's Discussion and
Analysis of Financial Condition and Results of Operations for each of those
periods have also been reclassified for discontinued operations and the Risk
Factors have been updated. The reclassified financial information,
Management's Discussion and Analysis and updated Risk Factors are included in
the exhibits to this filing.
(a) Financial Statements of Businesses Acquired.
None.
(b) Pro Forma Financial Information.
The Company is providing in Exhibit 99.1 a Report of Independent Auditors;
audited Consolidated Balance Sheets at December 31, 2000 and 1999; audited
Consolidated Statements of Income for the Years Ended December 31, 2000, 1999
and 1998; audited Consolidated Statements of Cash Flows for the Years Ended
December 31, 2000, 1999 and 1998; audited Consolidated Statements of
Stockholders' Equity for the Years Ended December 31, 2000, 1999 and 1998 and
Notes to those Consolidated Financial Statements updated to reflect the
impact of the EDS transaction as described in Note 2 to the Consolidated
Financial Statements.
The Company is providing in Exhibit 99.2 Management's Discussion and Analysis
of Financial Condition and Results of Operations as revised to reflect the
discontinued operations; and Risk Factors also updated to reflect the impact
of the EDS transaction.
The Company is providing in Exhibit 99.3 unaudited pro forma condensed
consolidated financial statements which give effect to (i) the acquisition of
GetThere Inc., (ii) the sale of the infrastructure outsourcing business and IT
infrastructure assets and associated real estate and (iii) the expected use of
the cash proceeds to retire a portion of the Company's outstanding debt. The
unaudited pro forma condensed consolidated balance sheet reflects these
transactions as if they had occurred on March 31, 2001. The preliminary
unaudited pro forma condensed consolidated statement of operations for the
three months ended March 31, 2001 and the twelve months ended December 31, 2000
reflects these transactions as if they had occurred on January 1, 2000. The
unaudited pro forma condensed consolidated financial statements do not reflect
anticipated future savings from the IT Outsourcing Agreement and revenue the
Company expects to earn under the Marketing Agreements with EDS. The statements
also do not reflect the impact on continuing operations of general and
administrative costs which historically have been allocated to the discontinued
operations, but which will not be eliminated as a result of the EDS transaction.
(c) Exhibits.
The exhibits filed herewith are shown on the Exhibit Index attached hereto and
are incorporated herein by this reference.
4
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
SABRE HOLDINGS CORPORATION
Date: July 16, 2001 /s/ William J. Hannigan
--------------------------------------------
William J. Hannigan
Chairman, President and Chief Executive
Officer
(Principal Executive Officer)
/s/ Jeffery M. Jackson
--------------------------------------------
Jeffery M. Jackson
Executive Vice President, Chief Financial
Officer and Treasurer
(Principal Financial and Accounting Officer)
5
EXHIBIT INDEX
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[Enlarge/Download Table]
EXHIBIT NUMBER DESCRIPTION FILED HEREWITH
2.1 Asset Purchase Agreement by and among EDS Information
Services L.L.C. ("EDS IS"), Electronic Data Systems
Corporation ("EDS"), Sabre Inc. ("Sabre"), and
Sabre Holdings Corporation ("Sabre Holdings"). (1)
2.2 First Amendment to Asset Purchase Agreement by and X
among EDS IS, EDS, Sabre and Sabre Holdings.
2.3 Second Amendment to Asset Purchase Agreement by and X
among EDS IS, EDS, Sabre and Sabre Holdings.
12.1 Computation of Ratio of Earnings to Fixed Charges X
23.1 Consent of Ernst & Young LLP X
99.1 Audited Consolidated Financial Statements and notes X
thereto, including Report of Independent Auditors.
99.2 Management's Discussion and Analysis of Financial X
Condition and Results of Operations and Risk
Factors.
99.3 Unaudited Pro Forma Condensed Consolidated Balance X
Sheet of Sabre Holdings Corporation as of March 31,
2001. Unaudited Pro Forma Condensed Consolidated
Statement of Operations of Sabre Holdings Corporation
for the three months ended March 31, 2001 and for the
twelve months ended December 31, 2000.
(1) Incorporated by reference to Exhibit 2.1 of the Registrant's quarterly
report on Form 10-Q filed May 15, 2001 for the period ended March 31, 2001.
6
Dates Referenced Herein and Documents Incorporated by Reference
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