8-K

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

Date of report (Date of earliest event reported): December 21, 2006

______________________________________________

Expedia, Inc.

(Exact Name of Registrant as Specified in Charter)

______________________________________________

Delaware	000-51447	20-2705720
(State or Other Jurisdiction	(Commission	(I.R.S. Employer
of Incorporation)	File Number)	Identification No.)

3150 139th Avenue S.E., Bellevue, Washington	98005
(Address of Principal Executive Offices)	(Zip Code)

Registrant's telephone number, including area code:	(425) 679-7200
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the
filing obligation of the registrant under any of the following provisions:
[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17
CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17
CFR 240.13e-4(c))

Item 1.01. Entry into a Material Definitive Agreement.

On December 21, 2006, effective as of December 18, 2006, Expedia, Inc. entered into a Second Amendment (the “Second Amendment”) to the Credit Agreement, dated as of July 8, 2005, among Expedia, Inc., a Delaware corporation, Expedia, Inc., a Washington corporation, Travelscape, Inc., a Nevada corporation, Hotels.com, a Delaware corporation, and Hotwire, Inc., a Delaware corporation, as Borrowers; the Lenders party thereto; Bank of America, N.A., as Syndication Agent; Wachovia Bank, N.A. and The Royal Bank of Scotland PLC, as Co-Documentation Agents; JPMorgan Chase Bank, N.A., as Administrative Agent; and J.P. Morgan Europe Limited, as London Agent, as amended as of December 7, 2006, providing for a reduced consolidated net worth requirement.

The foregoing summary is qualified in its entirety by reference to the Second Amendment, which is filed as Exhibit 10.1 to this report and incorporated herein by reference.

Item 9.01. Financial Statements and Exhibits.

(d)	Exhibits
10.1	Second Amendment, dated as of December 18, 2006, to the Credit Agreement dated as of
	July 8, 2005, among Expedia, Inc., a Delaware corporation; Expedia, Inc., a Washington
	corporation; Travelscape LLC, a Nevada limited liability company (successor to
	Travelscape, Inc., a Nevada corporation); Hotels.com, a Delaware corporation; Hotwire,
	Inc., a Delaware corporation; the other Borrowing Subsidiaries from time to time party
	thereto; the Lenders from time to time party thereto; JPMorgan Chase Bank, N.A., as
	Administrative Agent; and J.P. Morgan Europe Limited, as London Agent

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 thereunto duly authorized.

Date: December 27, 2006

EXPEDIA, INC.

By:  /s/ Burke F. Norton                                 

       Name: Burke F. Norton

       Title:    Executive Vice President, 

                  General Counsel and Secretary

EXHIBIT INDEX

10.1	Second Amendment, dated as of December 18, 2006, to the Credit Agreement dated as of
	July 8, 2005, among Expedia, Inc., a Delaware corporation; Expedia, Inc., a Washington
	corporation; Travelscape LLC, a Nevada limited liability company (successor to
	Travelscape, Inc., a Nevada corporation); Hotels.com, a Delaware corporation; Hotwire,
	Inc., a Delaware corporation; the other Borrowing Subsidiaries from time to time party
	thereto; the Lenders from time to time party thereto; JPMorgan Chase Bank, N.A., as
	Administrative Agent; and J.P. Morgan Europe Limited, as London Agent

EX-10.1

Exhibit 10.1

EXECUTION COPY

     SECOND AMENDMENT, dated as of December 18, 2006 (this “Amendment”), to the CREDIT AGREEMENT dated as of July 8, 2005, as amended by the First Amendment dated as of December 7, 2006 (as further amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), among EXPEDIA, INC., a Delaware corporation; EXPEDIA, INC., a Washington corporation; TRAVELSCAPE, LLC, a Nevada limited liability company (successor to TRAVELSCAPE, INC., a Nevada corporation); HOTELS.COM, a Delaware corporation; HOTWIRE, INC., a Delaware corporation; the other Borrowing Subsidiaries from time to time party thereto; the Lenders from time to time party thereto; JPMORGAN CHASE BANK, N.A., as Administrative Agent; and J.P. Morgan Europe Limited, as London Agent.

WITNESSETH:

     WHEREAS, the Lenders have agreed to extend credit to the Borrowers under the Credit Agreement on the terms and subject to the conditions set forth therein; and

     WHEREAS, the Company has requested that the Lenders amend certain provisions of the Credit Agreement and the Lenders under the Credit Agreement whose signatures appear below, constituting at least the Required Lenders, are willing to amend the Credit Agreement on the terms and subject to the conditions set forth herein;

     NOW, THEREFORE, in consideration of the mutual agreements herein contained and other good and valuable consideration, the sufficiency and receipt of which are hereby acknowledged, the parties hereto hereby agree as follows:

     SECTION 1.Defined Terms. Capitalized terms used but not otherwise defined herein (including in the preamble hereto) have the meanings assigned to them in the Credit Agreement.

     SECTION 2.Amendment of Section 6.11. Section 6.11 of the Credit Agreement is hereby amended in its entirety to read as follows:

               “SECTION 6.11. Consolidated Net Worth. The Company will not at any time permit Consolidated Net Worth to be less than the sum at such time of (a) US$4,500,000,000 and (b) commencing with the fiscal quarter beginning on January 1, 2007, 50% of the Company’s Consolidated Net Income for each fiscal quarter of the Company for which Consolidated Net Income is positive and for which financial statements shall have been delivered under Section 5.01(a) or (b).”

     SECTION 3.Representations, Warranties and Agreements. The Company, as to itself and each of the Subsidiaries, hereby represents and warrants to and agrees with each Lender and the Agents that:

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     (a)The representations and warranties set forth in Article III of the Credit Agreement, as amended hereby, are true and correct in all material respects on and as of the Amendment Effective Date (as defined below) and after giving effect to this Amendment, with the same effect as if made on and as of such date, except to the extent such representations and warranties expressly relate to an earlier date, in which case they were true and correct as of such earlier date.

     (b)As of the Amendment Effective Date, after giving effect to this Amendment, no Default or Event of Default has occurred and is continuing.

     SECTION 4.Effectiveness. This Amendment shall become effective as of the date (the “Amendment Effective Date”) on which the Administrative Agent shall have received duly executed counterparts hereof that, when taken together, bear the authorized signatures of the Company and Lenders constituting at least the Required Lenders.

     SECTION 5.Credit Agreement. Except as specifically stated herein, the Credit Agreement shall continue in full force and effect in accordance with the provisions thereof. As used therein, the terms “Agreement”, “herein”, “hereunder”, “hereto”, “hereof” and words of similar import shall, unless the context otherwise requires, refer to the Credit Agreement as modified hereby.

     SECTION 6.Applicable Law. THIS AMENDMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK.

     SECTION 7.Counterparts. This Amendment may be executed in counterparts (and by different parties hereto on different counterparts), each of which shall constitute an original but all of which, when taken together, shall constitute a single instrument. Delivery of an executed counterpart of a signature page of this Amendment by telecopy shall be effective as delivery of a manually executed counterpart hereof.

     SECTION 8.Expenses. The Company agrees to reimburse the Administrative Agent for its reasonable out-of-pocket expenses in connection with this Amendment, including the reasonable fees, charges and disbursements of Cravath, Swaine & Moore LLP, counsel for the Administrative Agent.

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     IN WITNESS WHEREOF, the parties hereto have caused this Second Amendment to be duly executed by their respective authorized officers as of the date first above written.

EXPEDIA, INC., a Delaware corporation,

by: /s/ Bret Myers                          

         Name: Bret Myers

         Title: Vice President and Treasurer

JPMORGAN CHASE BANK, N.A., individually

and as Administrative Agent,

by: /s/ Peter B. Thauer                   

         Name: Peter B. Thauer

         Title: Vice President

To approve the Second Amendment to the Expedia, Inc. Credit Agreement:

Name of Institution:

Fifth Third Bank

by:	/s/ Gary S. Losey
	Name: Gary S. Losey
	Title: Vice President
by:	_______________________1
	Name:
	Title:
1	For any institution requiring a second signature line.

To approve the Second Amendment to the Expedia, Inc. Credit Agreement:

Name of Institution:
Wachovia Bank, N.A.
by:	/s/ Scott Suddreth
	Name: Scott Suddreth
	Title: Vice President

To approve the Second Amendment to the Expedia, Inc. Credit Agreement:

Name of Institution:
The Royal Bank of Scotland, plc
by:	/s/ William McGinty
	Name: William McGinty
	Title: Senior Vice President

To approve the Second Amendment to the Expedia, Inc. Credit Agreement:

Name of Institution:
Bank of America, N.A.
by:	/s/ John Margetanski
	Name: John Margetanski
	Title: Vice President
by:	____________________1
	Name:
	Title:
1	For any institution requiring a second signature line.

To approve the Second Amendment to the Expedia, Inc. Credit Agreement:

Name of Institution:
U.S. BANK NATIONAL ASSOCIATION
by:	/s/ Kurban H. Merchant
	Name: Kurban H. Merchant
	Title: Vice President

To approve the Second Amendment to the Expedia, Inc. Credit Agreement:

Name of Institution:
BNP Paribas
by:	/s/ Nuala Marley
	Name: Nuala Marley
	Title: Managing Director
by:	/s/ Nanette Baudon               1
	Name: Nanette Baudon
	Title: Vice President
1	For any institution requiring a second signature line.

To approve the Second Amendment to the Expedia, Inc. Credit Agreement:

Name of Institution:
Societe Generale
by:	/s/ Nigel Elvey
	Name: Nigel Elvey
	Title: Vice President

To approve the Second Amendment to the Expedia, Inc. Credit Agreement:

Name of Institution:
BARCLAYS BANK PLC
by:	/s/ David Barton
	Name: David Barton
	Title: Associate Director

To approve the Second Amendment to the Expedia, Inc. Credit Agreement:

Name of Institution:
Sumitomo Mitsui Banking Corporation
by:	/s/ Leo E. Pagarigan
	Name: Leo E. Pagarigan
	Title: Joint General Manager
by:	____________________1
	Name:
	Title:
1	For any institution requiring a second signature line.

To approve the Second Amendment to the Expedia, Inc. Credit Agreement:

Name of Institution:
HSBC Bank USA, National Association
by:	/s/ Darren Pinsker
	Name: Darren Pinsker
	Title: Senior Vice President

To approve the Second Amendment to the Expedia, Inc. Credit Agreement:

Name of Institution:
Mizuho Corporate Bank, Ltd.

by:	/s/ Leon Mo
	Name: Leon Mo
	Title: Senior Vice President
by:	____________________1
	Name:
	Title:
1	For any institution requiring a second signature line.

To approve the Second Amendment to the Expedia, Inc. Credit Agreement:

Name of Institution:
United Overseas Bank Limited, New York Agency
by:	/s/ George Lim
	Name: George Lim
	Title: FVP and General Manager
by:	/s/ Mario Sheng
	Name: Mario Sheng
	Title: AVP