|TRIVAGO N.V. filed this Form 20-F on 03/06/2018|
On August 21/22, 2017, the Founders, Expedia Lodging Partner Services S.à r.l., trivago GmbH, trivago N.V. and certain other Expedia parties entered into a contribution agreement with respect to potential tax liability arising out of the Post-IPO merger, which we refer to as the contribution agreement. Following our IPO, we requested binding tax rulings from the German tax authorities regarding the tax neutrality to trivago GmbH, trivago N.V. and the Founders of the Post-IPO merger. Under the rulings, the German tax authorities have taken the opinion that trivago GmbH is liable for an immaterial tax amount. Under the IPO Structuring Agreement, our liability for this amount could be considered an "Adverse Ruling Determination", in which case the Post-IPO merger would only be consummated if we and Expedia Lodging Partner Services S.à r.l. entered into an agreement with Expedia Lodging Partner Services S.à r.l. that would make trivago GmbH whole for any additional tax liability incurred by it as a result of the Post-IPO merger. Under the contribution agreement, Expedia Lodging Partner Services S.à r.l. undertook, subject to the occurrence of a final, non-appealable and unchangeable tax assessment notice issued to us, to make an informal immaterial capital contribution (informele kapitaalstorting) on the Class B shares in cash in the amount of any (a) German Corporate Income Tax (Körperschaftsteuer), (b) German solidarity surcharge (Solidaritätszuschlag) thereon, and (c) German Trade Tax (Gewerbesteuer) that would not be made in exchange for any shares issued by us. In accordance with the terms and conditions of the contribution agreement, we and Expedia Lodging Partner Services S.à r.l. acknowledged that this contribution would be treated as share premium (agio) attached to the Class B shares and that the amount of this contribution would be attributed to our share premium reserve (agioreserve) attached to the Class B shares. The parties to the contribution agreement agreed that this contribution by Expedia Lodging Partner Services S.à r.l. shall be treated as a tax neutral shareholder contribution (verdeckte Einlage) at the trivago N.V. level for corporate tax purposes to the greatest extent possible. If and to the extent that German tax authorities challenge the neutral treatment of the contribution amount at the trivago N.V. level for corporate tax purposes, Expedia Lodging Partner Services S.à r.l. will contribute to us, in addition to the contribution amount referenced above, such additional amount as is necessary to ensure that the net amount actually received by us (after taking into account the payment by us of corporate taxes imposed on the contribution amount and any additional amounts payable to us pursuant the requiring payment of such additional amounts) that equals the full amount that we would have received had no such corporate taxes been imposed on the contribution amount.
Credit facility Guarantee
On September 5, 2014, we entered into an uncommitted credit facility with Bank of America Merrill Lynch International Ltd., one of the underwriters of our IPO, with a maximum principal amount of €10.0 million. Advances under this facility bear interest at a rate of LIBOR plus 1.0% per annum. This facility may be terminated at any time by the lender. Our obligations under this facility are guaranteed by Expedia. On December 19, 2014, we entered into an amendment to this facility pursuant to which the maximum principal amount was increased to €50.0 million. We utilized €20.0 million of our €50.0 million credit facility to fund capital requirements in 2015. During the year ended December 31, 2016, we utilized an additional €20.0 million under our credit facility, and subsequently repaid a total of €40.0 million of this obligation. As of December 31, 2016 and 2017, €0.0 million was drawn from our €50.0 million credit facility.
On July 23, 2015, we entered into a Lease Agreement with Jupiter EINHUNDERTVIERUNDFÜNFZIG GmbH (now IMMOFINANZ Medienhafen GmbH) for office space in the Media Harbour area in Düsseldorf with a monthly rent of €566,560. The initial lease term is for ten years starting with handover of the location scheduled for May 2018, and we have the option to extend the lease term for another ten years. Initially, our obligations under this lease agreement were guaranteed by Expedia. With effect as of July 2017, the parent guarantee was replaced by a bank guarantee.
Loans from Expedia
In 2014, Expedia granted a loan of €1.0 million to the company in conjunction with our acquisition of Rheinfabrik in 2014. We repaid the loan during 2015.