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EXHIBIT 10.23
HCC PARTICIPANT AGREEMENT
This Agreement (the "Agreement") is entered into by and
between THE HOTEL CLEARING CORPORATION, a Delaware corporation ("HCC"), and ITT
SHERATON CORPORATION ("Participant"), to be effective the 28 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;
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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 first [*] 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 greater than [*] but
less than [*] shall be due from either party
for each such Commissionable Reservation over [*]
but less than [*].
(b) For each Commissionable Reservation in excess of [*]
processed each month, [*] a transaction fee each
month (the [*]) as follows:
For any month wherein the total of Commissionable
Reservations processed are in excess of [*] but less
than [*] a Participant Transaction Fee of [*] for
each Commissionable Reservation between [*] and
[*];
For any month wherein the total of Commissionable
Reservations processed are in excess of [*] but
less than [*] a Participant Transaction Fee of
[*] for each Commissionable Reservation between
[*] and [*];
For any month wherein the total of Commissionable
Reservations processed are in excess of [*] and
less than [*] a Participant Transaction Fee of
[*] for each Commissionable Reservation between
[*] and [*]; and
For any month wherein the total of Commissionable
Reservations processed are in excess of [*], a
Participant Transaction Fee of [*] for each
Commissionable Reservation in excess of [*].
*Confidential Treatment Requested
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Provided however, notwithstanding the preceding provisions
of this 3.1(b), the total Participant Transaction Fee paid
per month shall not exceed an amount equal to [*] per
Commissionable Reservation 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 HCC to timely pay
Participant all Participant Transaction Fees 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) [*] (iv)
[*] 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 [*] 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.
*Confidential Treatment Requested
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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 Agreement by providing notice as
required herein.
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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
and HCC's business, 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 xxxx 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:
0000 Xxxxxx Xxxxx Xxxx.
Xxxxx 0000
Xxxxxx, XX 00000
Attention: Xxxx X. Xxxxx, III
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 ITT SHERATON CORPORATION
By: [ILLEGIBLE] By: [ILLEGIBLE]
------------------------------ --------------------------
Its: V.P. SALES Its: SR. V.P.
----------------------------- -------------------------
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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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