Exhibit 99.1
[LOGO OF EXPEDIA, INC.] [LOGO OF USA NETWORKS, INC.]
FOR IMMEDIATE RELEASE
February 5, 2002
Expedia, Inc. shareholders approve USA Networks, Inc. transaction
Majority ownership transfers to USA
BELLEVUE, Washington - February 5, 2002 - Expedia, Inc. (NASDAQ: EXPE)
today reported that on February 4, 2002, its shareholders approved the merger
transaction in which USA Networks, Inc. (NASDAQ: USAI) became the controlling
shareholder of Expedia(R). The transaction was completed yesterday.
The transaction transfers the ownership of 33.7 million shares of Expedia
from Microsoft Corporation to USA. In addition, another 1.0 million shares,
including approximately 240,000 shares submitted via notice of guaranteed
delivery, were exchanged by other Expedia shareholders for a package of USA
securities, bringing USA's ownership in Expedia to 34.7 million shares, or about
65% of the 53.7 million basic shares outstanding, and representing 94.9% percent
of the voting interest.
On a preliminary basis, for each Expedia share, exchanging shareholders,
including Microsoft, received 0.6009 shares of USA common stock; 0.3779 shares
of USA cumulative convertible preferred stock, and 0.4229 USA warrants. In
aggregate, USA issued to former shareholders of Expedia who elected to receive
USA securities approximately 20.9 million shares of USA common stock, 13.1
million shares of USA cumulative convertible preferred stock and 14.7 million
USA warrants.
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Expedia shareholders who did not exchange their shares for the USA
securities retained their Expedia common stock and received 0.192 warrants for
each Expedia share. Each warrant entitles the holder to purchase one share of
Expedia common stock for $52 through February 4, 2009. Including warrants
distributed to Expedia option holders on January 25, 2001, Expedia issued 6.4
million warrants to holders of its securities. The Expedia warrants will trade
on Nasdaq under the symbol "EXPEW."
The number of shares of USA common stock and USA cumulative convertible
preferred stock received in exchange for each exchanging Expedia share will
change in the event that all of the approximately 240,000 shares submitted via
notice of guaranteed delivery are not submitted to the exchange agent by
Wednesday at 5:00 p.m., eastern time. The final exchange ratios will be
announced on Thursday, February 7, 2002.
The USA cumulative convertible preferred stock has a $50 face value, a
1.99% annual dividend, two votes per share, and is convertible at any time into
USA common stock at a conversion price of $33.75 per USA share, subject to a
downward adjustment to the extent the average share price of USA common stock
over a ten trading-day period prior to conversion is greater than $35.10. Each
complete USA warrant entitles the holder to purchase one share of USA common
stock for $35.10 through February 4, 2009. The USA cumulative convertible
preferred will trade on OTC under the symbol "USAIP". The USA warrants will
trade on Nasdaq under the symbol "USAIW."
Immediately after the closing of the merger transaction, the Expedia board
of directors expanded the Board from 7 to 13 members. With one of these members
still to be named, the new Expedia Board consists of Barry Diller, chairman and
chief executive officer of USA, as chairman; Richard Barton, president and chief
executive officer of
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Expedia; Tom Breitling, former president of Travelscape, Inc.; Julius
Genachowski, executive vice president and general counsel of USA; Jay Hoag,
general partner of Technology Crossover Ventures; Victor Kaufman, vice chairman
of USA; Dara Khosrowshahi, executive vice president and chief financial officer
of USA; Gregory Maffei, CEO of 360networks and former chairman of Expedia's
board of directors; Daniel Marriott, senior vice president, strategic planning,
USA; Jon Miller, president and CEO, USA Information and Services, a division of
USA; John Pleasants, president and CEO of Ticketmaster, Inc.; and Gregory
Stanger, senior vice president and chief financial officer of Expedia.
It is anticipated that the Board will fill the remaining Board seat
promptly.
About Expedia, Inc.
Expedia, Inc. (Nasdaq: EXPE) operates the largest online travel service in
the world, with Expedia.com(R) in the United States and localized versions in
Europe and Canada. To help travelers travel right, Expedia.com provides a wide
variety of travel products and services, such as Expedia(R) Special Rate hotels
and vacation rentals with the guaranteed lowest prices. Expedia's quality and
leadership are recognized by several awards, including Yahoo! Internet Life's
"Best Overall Travel Site" and one of Mobile Computing & Communications' "Best
Mobile Web Sites of 2001".
Expedia.com customers are supported by a credit card guarantee (U.S. site
only), the industry's best privacy policy, and live agents via e-mail and an
800-number available 24 hours a day/seven days a week. Expedia.com is also
available under Travel on the MSN network of Internet services.
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About USA Networks, Inc.
USA Networks, Inc. (Nasdaq: USAI), to be renamed USA Interactive upon close
of its pending transaction with Vivendi Universal, is organized into two groups,
the Interactive Group and the Entertainment Group. The Interactive Group
consists of Home Shopping Network (including HSN International and HSN
Interactive); Ticketmaster (Nasdaq: TMCS), which operates CitySearch and
Match.com; Hotel Reservations Network (Nasdaq: ROOM); Electronic Commerce
Solutions; Styleclick; Precision Response Corporation; and now, Expedia, Inc.
(Nasdaq: EXPE). The Entertainment Group consists of USA Cable, including USA
Network, SCI FI Channel, TRIO, Newsworld International, and Crime; Studios USA,
which produces and distributes television programming; and USA Films, which
produces and distributes films. On December 17, 2001, USA and Vivendi Universal
announced a transaction in which the assets of the Entertainment Group would be
contributed to Vivendi Universal Entertainment, a new joint venture. ###
Expedia, Expedia.com, and the airplane logo and Travelscape are either
registered trademarks or trademarks of Expedia, Inc. in the United States,
Canada and/or other countries. Other products and company names mentioned herein
may be trademarks of their respective owners.
For more information, press only:
For Expedia: Darcy Bretz, Edelman Public Relations (312) 240-2619,
Darcy.bretz@edelman.com
For USA: Ron Sato, USA Communications (212) 314-7254. Sato@usanetworks.com
For more information, investment community:
For Expedia: Marj Charlier, Director of Investor Relations, 425-564-7666
For USA: Roger Clark/Lauren Rosenfield, USA Investor Relations (212) 314-7400
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