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EXHIBIT 10.57
HCC PARTICIPANT AGREEMENT
This Agreement (the "Agreement") is entered into by and between THE HOTEL
CLEARING CORPORATION, a Delaware corporation ("HCC"), and HFS INCORPORATED
("Participant"), to be effective the 16th day of May, 1997.
SECTION 1. DEFINITIONS
1.1 For purposes of this Agreement, the following definitions shall
apply:
(i) Commissionable Reservations. Commissionable Reservations
within a particular time period equals the number of
reservations (both voice and electronic) processed through
the HCC System within such time period that are identified as
"commissionable" or "partially commissionable" on the
transaction records provided by Participant to HCC and for
which a travel agent commission is paid pursuant to this
Agreement.
(ii) HCC System. The HCC System is HCC's automated clearinghouse
system to provide for the coordination of reservation
information, transfer of hotel reservation commissions and
ancillary services to Travel Agents and Participating
Entities.
(iii) Participating Entity. A Participating Entity is an operator
of a hotel reservation system that has executed a HCC
Participant Agreement.
(iv) HCC Travel Agents. An HCC Travel Agent is a travel agency who
has executed an HCC Subscriber Agreement. A list of current
HCC Travel Agents will be periodically provided by HCC to
Participant.
(v) HCC Travel Agent Commissions. HCC Travel Agent Commissions
are the commissions paid by Participant to HCC Travel Agents
pursuant to this Agreement. HCC Travel Agent Commissions will
be based on commission rates provided by Participant to HCC.
SECTION 2. THE HCC SYSTEM
2.1 Duties of HCC. HCC will provide and operate the HCC System for the
use and benefit of Participant, its franchisees and affiliates, and
other Participating Entities. HCC will provide all reasonable and
necessary technical support, hardware and software, except as
otherwise provided herein, and modifications to the HCC System to
provide clearinghouse services to Participant and its franchisees
and affiliates as described below. Upon compliance with the terms
of this Agreement by Participant, its franchisees and affiliates,
and subject to Section 5 hereof, HCC will provide the following
clearinghouse services to Participant and its franchisees and
affiliates:
(i) identify Participant to travel agents as being a HCC System
Participating Entity;
INFORMATION CONTAINED IN THIS AGREEMENT HAS BEEN OMITTED SUBJECT TO A
CONFIDENTIAL TREATMENT REQUEST AND HAS BEEN FILED SEPARATELY WITH THE S.E.C.
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(ii) provide billing statements for HCC Travel Agent Commissions,
Transaction Fees (as defined below) and other fees, costs and
expenses to Participant no later than the fifteenth (15th)
business day after the end of each month as provided in
Section 3 below;
(iii) distribute collected HCC Travel Agent Commissions received
from Participant and its affiliates and franchisees to the
appropriate HCC Travel Agents as set forth in the HCC Travel
Agent Commission information provided by Participant;
(iv) provide no later than the fifteenth (15th) business day of
each month reports to Participant and HCC Travel Agents
reflecting HCC Travel Agents' reservation transactions with
Participant and HCC Travel Agent Commissions owed based upon
the data provided to HCC by Participant and its affiliates
and franchisees who are participating in the HCC System; and
(v) provide telephone customer support services from 8:00 a.m. to
5:00 p.m., U.S. Central time, Monday through Friday,
exclusive of legal holidays.
The procedures of the HCC System are subject to changes for enhancements from
time to time as determined by HCC, provided that no such changes will have a
significant adverse impact on the clearinghouse services described above.
2.2 Duties of Participant. Participant shall diligently and in good
faith do the following:
(i) Cooperate reasonably with HCC personnel with respect to the
implementation of the HCC System between HCC Travel Agents
and Participant and its affiliates and franchisees;
(ii) Provide HCC with all that is reasonably required by HCC to
process all reservations (including all reservations made
electronically or by voice, through the use of a central
reservation "800" phone number, inclusive of no-shows,
cancellations and non-commissionable transactions) made by
HCC Travel Agents with Participant and, subject to 2.2(iv),
its affiliates and franchisees no less often than on a
semi-monthly basis such data being complete and accurate to
the best of Participant's knowledge and ability and inclusive
of all of the information to permit HCC to provide the
clearinghouse services described in Section 2.1 hereof and,
without limitation, being such information as set forth on
Exhibit A hereof; and permit and authorize HCC to obtain and
use such data concerning such reservations made with
Participant and, subject to 2.2(iv), its affiliates and
franchisees except such data designated as confidential
pursuant to Section 7 hereof. The foregoing shall be subject
to receipt by Participant from HCC of the instructions,
specifications, directions, information, assistance, and
cooperation reasonably required by Participant to provide the
foregoing.
(iii) Pay, pursuant to this Agreement, all Travel Agent Commissions
reported to HCC for processing pursuant to this Agreement
within two (2) business days of receipt of the billing
statement described in Section 3.5 hereof;
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(iv) Use its reasonable efforts to cause each of its franchisees
and affiliates to fully and timely participate in the HCC
System pursuant to this Agreement;
(vi) Permit HCC to use its name as an entity participating in the
HCC System.
2.3 Modification or Enhancement of the HCC System or Participant
System. HCC may in its sole discretion modify the operation or
enhance the capability of the HCC System, and Participant agrees to
cooperate reasonably with HCC to the extent reasonably necessary to
effectuate modifications and enhancements of the HCC System. If
Participant determines that such modification or enhancement is
likely to require Participant to make significant modifications to
its central reservation system (any such modifications to be at
Participant's sole expense), HCC will provide at least ninety (90)
days' prior notice to Participant of such modification or
enhancement and Participant may, at its option, terminate this
Agreement upon sixty (60) days notice to HCC.
SECTION 3. FEES, COSTS, AND PAYMENTS
3.1 Fees for Processing HCC Travel Agent Commissions.
(a) For the [*] Commissionable Reservations processed
each month, Participant shall pay HCC a transaction fee ("HCC
Transaction Fee") each month of U.S. [*] for each such
Commissionable Reservation processed. For any month wherein
the total of Commissionable Reservations is [*]
but less than [*] shall be due [*]
for each such Commissionable Reservation [*]
(b) For each Commissionable Reservation in excess of [*]
processed each month, [*]
each month (the [*] ) as
follows:
For any month wherein the total of Commissionable
Reservations processed are in excess of [*] but less than
[*] a [*] for each
Commissionable Reservation between [*] ;
For any month wherein the total of Commissionable
Reservations processed are in excess of [*] but less than
[*] a [*] for each
Commissionable Reservation between [*] ;
For any month wherein the total of Commissionable
Reservations processed are in excess of [*] and less than
[*] a [*] for each
Commissionable Reservation between [*] ; and
For any month wherein the total of Commissionable
Reservations processed are in excess of [*] a
[*] for each Commissionable
Reservation in excess of [*] .
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Provided however, notwithstanding the preceding provisions of this
3.1(b), the total [*] paid per month shall not exceed an amount
equal to [*] in the aggregate.
3.2 Commission Payments. HCC shall pay HCC Travel Agent Commissions in
the travel agent's local currency or the currency requested by the
travel agency. HCC shall be responsible for complying with laws and
regulations relating to the treatment of unclaimed property
(sometimes referred to as "escheatment" laws) resulting from checks
issued to travel agents under this Agreement. The parties will
jointly establish mutually acceptable procedures to be implemented
by HCC in order to comply with such laws and regulations. The
parties will meet to establish such procedures by no later than
thirty (30) days after the effective date, and will cooperate and
work diligently with one another in order to finalize same as
promptly as practical.
3.3 Disputed Commissions. HCC will provide Participant and HCC Travel
Agents with periodic reports indicated under Section 2.1(iv) that
will indicate any exceptions to HCC Travel Agent Commissions, based
on discrepancies between information given HCC by Participant
compared to other information available to HCC. With respect to all
exceptions as to which Participant provides supporting
documentation, HCC will forward such documentation to the
appropriate HCC Travel Agent(s), and the HCC Travel Agents involved
may pursue such dispute directly with Participant('s) franchisees,
but HCC will not have any liability to either Participant or any
travel agent (HCC or non-HCC) with respect to the resolution of any
disputed commission. No dispute concerning any travel agent
commissions will in any way affect or reduce the obligations of
Participant to (i) timely pay all other HCC Travel Agent
Commissions reported to HCC for processing and (ii) timely pay to
HCC all Transaction Fees and other fees, costs and additional
expenses owed by Participant under this Agreement; nor shall any
such dispute in any way affect or reduce the obligations of [*] due
under this Agreement.
3.4 Billing Statements. Based upon the information provided HCC by or
with respect to Participant pursuant to Section 2.2, above, HCC
will provide Participant a monthly billing statement detailing (i)
HCC Travel Agent Commissions to be paid by Participant for the
period covered by such billing statement; (ii) HCC Transaction Fees
to be paid by Participant, based on Commissionable Reservations for
the period covered by such billing statement; (iii) [*], based on
Commissionable Reservations for the period covered by such billing
statements, (iv) any refund of the Incentive Fee which is due and
(v) all other costs and fees owed by Participant pursuant to this
Agreement. All fees and costs shall be paid in U.S. dollars.
SECTION 4. TERM
4.1 Term of Agreement. The initial term of this Agreement shall begin
on the effective date set forth at the beginning of this Agreement
and, unless earlier terminated pursuant to the provisions of this
Agreement, shall expire on the last day of the sixtieth (60th)
month after the date of this Agreement. However, this Agreement will
be automatically renewed and extended for additional twelve (12)
month periods unless, at least sixty (60) days prior to the
expiration of the initial term of this Agreement or any additional
twelve (12) month period, either party provides written notice to
the other of its decision not to renew and extend.
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SECTION 5. TERMINATION
5.1 Termination Upon Default. Upon the occurrence of an Event of
Default (as defined below) by either party and the failure of such
party to cure such default after notice and opportunity to cure as
provided by Section 6.3 below, the nondefaulting party may
terminate this Agreement at any time.
5.2 Suspension of Status. Upon the occurrence of an Event of Default by
Participant and the failure of Participant to cure such default
after notice and opportunity to cure as provided by Section 6.3
below, then, if HCC does not terminate this Agreement under Section
5.1, until such time as such Event of Default is cured HCC shall
have the right to suspend the status of Participant as a
Participating Entity and to notify all HCC Travel Agents of such
default and suspension through central reservation systems or
otherwise.
SECTION 6. DEFAULT
6.1 Events of Default. Subject to Section 6.2 below, any one of the
following will be considered an Event of Default:
(i) The failure of either party to pay any amount due hereunder
within the time required;
(ii) The failure of Participant or HCC to satisfy the obligations
set forth in this Agreement;
(iii) The refusal or failure of either party to perform diligently
and in good faith each and every material provision of this
Agreement;
(iv) If either HCC or Participant (the "Defaulting Party") becomes
insolvent, takes any step leading to its cessation as a going
concern, or ceases business operations for reasons other than
a strike and other than assignment as allowed by this
Agreement, then the other party (the "Insecure Party") may
immediately terminate this Agreement upon written notice to
the other party unless the Defaulting Party immediately gives
the Insecure Party adequate assurance of the future
performance of this Agreement. If bankruptcy proceedings are
commenced with respect to the Defaulting Party, and if this
Agreement has not otherwise terminated, then the Insecure
Party may suspend all further performance of this Agreement
until the Defaulting Party assumes or rejects this Agreement
pursuant to Section 365 of the Bankruptcy Code or any similar
or successor provision. Any such suspension of further
performance by the Insecure Party pending the Defaulting
Party's assumption or rejection will not be a breach of this
Agreement.
Any such Event of Default shall not relieve the defaulting party from any
of its obligations hereunder, and the non-defaulting party shall, except
as provided in this Agreement, be entitled to whatever remedies at law or
in equity are available to it.
6.2 Force Majeure. It will not constitute an Event of Default if such
event listed in Section 6.1 is caused by or results from acts of
God, fire, war, civil unrest, accident, power fluctuations or
outages, telecommunication fluctuations, outages or delays, utility
failures, mechanical defects, or other events beyond the control of
the defaulting party. However, if any such occurrence results in
any of the events described in Section 6.1, and the same continues
for more than thirty (30) consecutive days, either party may
terminate this
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Agreement by providing notice as required herein.
6.3 Cure Period. Upon the occurrence of an Event of Default, the
non-defaulting party will give written notice to the defaulting
party specifying the alleged default. In the case of a monetary
default by either party, the defaulting party will only be allowed
to cure such default within two (2) business days after receipt of
such notice, by delivering that amount owed to HCC in good funds
into the non-defaulting party's bank account. In all other
instances, the defaulting party will be entitled to fifteen (15)
days from receipt of notice within which to cure the default.
SECTION 7. CONFIDENTIALITY
7.1 Proprietary Information. During the term of this Agreement, it is
acknowledged by Participant and HCC that each may receive
confidential and proprietary information that is the property of
the other party. All such confidential and proprietary information
will be marked or otherwise identified as such and will be treated
as confidential and proprietary subject only to disclosure where
required by law. Such designation may be removed by each party
making the designation. Participant acknowledges that it will have
no access to and will not use the HCC System or related property,
other than as specifically provided for in this Agreement, and that
such system and related property is confidential and proprietary
property of HCC. Any use of HCC service marks or trade names by
Participant is subject to prior written approval of HCC, provided,
that Participant may describe the HCC System contemplated by this
Agreement in its franchise offering circular and other materials as
required by state or federal law. Unless otherwise provided herein,
any use of Participant's service marks or trade names by HCC is
subject to prior written approval of Participant. The provisions of
this Section 7.1 will remain binding and in force and effect as
long as such information remains confidential (other than by breach
of this Agreement), notwithstanding the expiration or termination
of this Agreement at any time. Except as is necessary in connection
with the performance of this Agreement, information regarding the
reservations and other transactions of Participant processed by HCC
shall be treated as confidential whether or not so marked or
otherwise identified as confidential.
SECTION 8. INDEMNIFICATION
8.1 Indemnification in the Event of Certain Losses. Participant agrees
to indemnify and hold harmless HCC and HCC's affiliates, directors,
officers, employees and stockholders, from and against any losses,
claims, liabilities, damages or expenses (including reasonable
attorney's fees) occurring as a result of or arising out of a
material breach of this Agreement on account of Participant's (or
its franchisees) fault, to the extent not caused by the fault of
HCC ("HCC's Losses"). HCC agrees to indemnify and hold harmless
Participant, and Participant's affiliates, directors, officers,
employees and stockholders, from and against any losses, claims,
liabilities, damages or expenses (including reasonable attorney's
fees) ("Participant's Losses") occurring as a result of or arising
out of a material breach of this Agreement on account of HCC's
fault to the extent not caused by the fault of Participant.
Promptly after receipt by an indemnified party of notice of the
commencement of any action or the presentation or other assertion
of any claim which could result in any indemnification claim
pursuant to this Section 8.1, such indemnified party will give
prompt notice thereof to the indemnifying party and the
indemnifying party will be entitled to participate therein or, to
the extent that it wishes, assume the defense thereof with its own
counsel. If the indemnifying party elects to assume the defense of
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any such action or claim, the indemnifying party shall not be
liable to the indemnified party for any fees of other counsel or
other expenses subsequently incurred by such indemnified party in
connection with the defense thereof, other than reasonable costs of
investigation and preparation, unless representation of both
parties by the same counsel would be inappropriate due to actual or
potential differing interests between them. The parties agree to
cooperate to the fullest extent possible in connection with any
claim for which indemnification is or may be sought under this
Agreement. Whether or not the indemnifying party elects to assume
the defense of any such action or claim, the indemnifying party
shall not be liable for any compromise or settlement of any such
action or claim effected without its consent (which shall not be
unreasonably withheld).
SECTION 9. DISCLAIMER OF WARRANTIES
9.1 Waiver of Warranties. HCC WILL NOT BE RESPONSIBLE OR LIABLE FOR ANY
FALSIFICATIONS OR INACCURACIES IN THE DATA PROVIDED BY PARTICIPANT
OR THE INFORMATION PROCESSED BY OR THROUGH THE HCC SYSTEM NOR WILL
IT HAVE ANY LIABILITY FOR ANY ACT OR FAILURE TO ACT WITH RESPECT TO
THE DATA OR THE PAYMENT OF COMMISSIONS UNLESS EXPRESSLY SET FORTH
HEREIN. EXCEPT WITH RESPECT TO HCC'S GROSS NEGLIGENCE OR WILLFUL
MISCONDUCT, ALL WARRANTIES, EXPRESS OR IMPLIED, STATUTORY OR
OTHERWISE, INCLUDING, WITHOUT LIMITATION, ANY WARRANTY OF FITNESS
FOR A PARTICULAR PURPOSE, MERCHANTABILITY, GOOD AND WORKMANLIKE
PRODUCT OR SERVICE OR OTHERWISE, ARE DISCLAIMED BY HCC AND WAIVED
BY PARTICIPANT.
9.2 No Consequential Damages. Except with respect to the
indemnification provisions set forth in Section 8.1 hereof, neither
party will be liable to the other for any consequential damages
caused or resulting from any breach of this Agreement or arising
out of the performance of this Agreement, and each party hereby
expressly waives such damages.
SECTION 10. MISCELLANEOUS
10.1 Arbitration of Disputes. Any controversy or claim arising out of or
relating to this contract, or the breach thereof, will be settled
by arbitration in accordance with the Commercial Arbitration Rules
of the American Arbitration Association, and judgment upon the
award rendered by the arbitrators may be entered in any court
having jurisdiction thereof. There shall be a panel of three
arbitrators. Each party will select one arbitrator within thirty
(30) days of notice of the dispute, and the two (2) arbitrators
selected shall select a third neutral arbitrator within thirty (30)
days after the second arbitrator is chosen. All reasonable and
necessary costs and fees (including attorney's fees) incurred in
connection with the arbitration will be borne by the losing party
or assessed in the award as otherwise deemed appropriate by the
arbitrators. If the demand for arbitration is initiated by
Participant, venue of the arbitration proceedings will be
determined by HCC. If the demand for arbitration is initiated by
HCC, venue of the arbitration proceedings will be determined by
Participant.
10.2 Non-Exclusive Agreement. Each party acknowledges that this is not
an exclusive agreement with respect to reservations commissions
clearinghouse services and that each party may contract with other
parties providing same or similar services.
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10.3 Status of Parties. This Agreement will not constitute a
partnership, joint venture or similar arrangement. The parties
hereto are separate and distinct entities independently contracting
with each other at arms length. HCC will not be deemed by this
Agreement to be granting a license to Participant with respect to
the HCC System or any software or service ▇▇▇▇ related thereto, or
otherwise, this being a contract for the use and rendering of
services only.
10.4 Assignment. This Agreement is not assignable by HCC or Participant
without the prior written consent of the non-assigning party, and
such consent shall not be unreasonably withheld or delayed provided
that Participant may assign this Agreement to a wholly-owned
subsidiary or in connection with the sale of its reservation system
or franchise system and either party may assign this Agreement
without consent in the event of a merger, consolidation, or sale of
substantially all of its assets.
10.5 Notices. All notices and other communications contemplated hereby
must be in writing (except in the case of electronically
transmitted data) and (a) personally delivered, (b) deposited in
the United States mail, first-class, registered or certified mail,
return receipt requested, with postage prepaid, (c) sent by
overnight courier service (for next business day delivery),
shipping prepaid, (d) sent by telecopy or facsimile with
confirmation of receipt to the number indicated, or (e) transmitted
directly to the recipient by electronic data transmission pursuant
to arrangements made between the parties. Such notices and other
communications (except in the case of electronically transmitted
data) shall be addressed as follows:
IF TO HCC: IF TO PARTICIPANT:
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇. ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇.
▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ Attn: ▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇, III Fax: ▇▇▇-▇▇▇-▇▇▇▇
If by telecopy/facsimile to:
528-5675
or such persons or addresses as any party may request by notice
duly given hereunder. Except as otherwise specified herein, notices
will be deemed given and received when received.
10.6 Controlling Law. This Agreement will be interpreted pursuant to the
laws of the State of Texas without reference to its conflict of
laws principles. Subject to the agreement to arbitrate and the
jurisdiction and venue provisions set forth in Section 10.1 hereof,
any action brought relating to or arising out of this Agreement
must be brought in the state or federal courts situated in the
county and state of the residence or principal place of business of
the party against whom the action is brought (or any of them, if
more than one).
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10.7 Entire Agreement. This Agreement and the Exhibits attached hereto
constitute the entire agreement between HCC and Participant with
respect to the provision of services under the HCC System and
supersedes and replaces any and all other agreements and
representations, verbal or written, with respect to the subject
matter of this Agreement. There are no representations, warranties
or agreements made or relied upon by either party with respect to
the subject matter of this Agreement that are not contained in this
Agreement.
10.8 Successors and Assigns. This Agreement will be binding upon and
will inure to the benefit of the legal representatives, successors
and duly authorized assigns of each party whether resulting from
merger, acquisition, reorganization or assignment pursuant to the
terms hereof.
10.9 Confidentiality of the Agreement. The parties agree that the terms
and provisions of this Agreement will be kept confidential and
shall be disclosed only to those persons and entities as required
by law or as permitted by the other party hereto. The parties may,
however, disclose the existence of this Agreement to any person or
entity.
AGREED to as of the date first written above.
THE HOTEL CLEARING CORPORATION HOSPITALITY FRANCHISE SYSTEMS, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇, III By: /s/ ▇▇▇ ▇▇▇▇▇
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Its: President Its: VP Worldwide Sales
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EXHIBIT A
Initial Information to be Provided by Participant to HCC
The fields in each commission record are the following:
-Record identifier required validated
-Chain record number required check for duplicates
-Chain/Brand code required validated
-Booking source required validated
-Property ID required validated
-PNR Number optional no checks
-Confirmation number required validated presence
-Cancellation number optional no checks
-Corporate ID number optional no checks
-Subscriber IATA number required validated HCC User
-Group/Guest last name required validated presence
-Group/Guest first name optional no checks
-Status code required validated
-Reason code optional if present, validate
-Arrival date required validated, no future
-Departure date required validated, no future
-Number of nights required validated presence
-Number of rooms required validated presence
-Commissionable revenue required validated, no neg.
-Gross Commission required validated, no neg.
-Adjustment amount required validated presence
-Net Commission due required validate computation
-Currency code required validated
-Comments optional no checks
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