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EXHIBIT 16
MASTER AGREEMENT
This Master Agreement ("Agreement"), dated the 17th day of November, 1999, is
between Delta Air Lines, Inc. ("Delta") and xxxxxxxxx.xxx Incorporated
("Priceline").
Recitals
Delta has agreed to amend the General Agreement, dated August 31, 1998,
as amended (the "GA"), to add United Airlines, American Airlines, US Airways,
Japan Airlines, Alitalia and Aerolineas Argentinas to the list of permitted
carriers and to modify sections of the GA relating to market restrictions, the
allocation methodology, and reporting and audit rights set forth therein. In
exchange, Priceline (a) has agreed to provide financial consideration to Delta
by making possible certain arrangements described herein and (b) has requested
the release by Xxxxxx Xxxxxxx of Delta from a lock-up arrangement so that Delta
may sell 8,440,067 shares ("Market Sale Shares") of its approximately 14.4
million shares of Priceline common stock. In addition, Priceline has agreed that
the remaining approximately six million shares of Priceline common stock held by
Delta will be exchanged, at Delta's option, for approximately six million shares
of newly issued Priceline convertible preferred stock, which will bear an eight
percent annual pay-in-kind dividend.
The parties agree to the following:
ARTICLE 1 - ACTIONS OF THE PARTIES
1.1 Amendment to General Agreement and Airline Participation Agreement
Delta and Priceline agree to amend the General Agreement and Airline
Participation Agreement, dated August 31, 1998, as amended ("APA"), in
accordance with Exhibit A, attached hereto and incorporated by reference
herein (the "Amendment").
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1.2 Release from Lock-up
Priceline will use its best efforts to cause Xxxxxx Xxxxxxx & Co.
Incorporated and Xxxxxx Xxxxxxx & Co. International Limited (collectively,
Xxxxxx Xxxxxxx) to release the Market Sale Shares held by Delta from the
lock-up that expires on February 7, 2000 pursuant to that certain Lock-Up
Letter from Delta to Xxxxxx Xxxxxxx and several Underwriters dated August
11, 1999 (the "Lock-Up"). In addition, Priceline shall not request, will
oppose if requested, and will use its best efforts to cause Xxxxxx Xxxxxxx
not to release any other parties from any existing lock-up agreements
relating to Priceline, until Delta has sold the Market Sale Shares.
1.3 No Amendment of Warrant Agreements
Priceline shall not amend, during the period from the date hereof until the
earlier of February 7, 2000 or Delta having sold the Market Sale Shares
(the "Release Date"), any warrant agreement or warrant certificate to
permit a cashless exercise feature.
1.4 No Sale or Registration of Securities
Priceline shall not initiate, and to the extent it has a contractual right
to do so, Priceline shall not consent to or participate in, a sale of
equity securities of Priceline until after the Release Date.
1.5 Convertible Preferred Stock
At Delta's option, , all of the shares of Priceline Common Stock held by
Delta (other than the Market Sale Shares) will be exchanged for
$359,580,000 aggregate principal amount of a newly issued class of
convertible preferred stock of Priceline bearing an accruing semi-annual
paid-in-kind dividend at a rate of eight percent (8%) per annum, payable
semiannually, in Priceline common shares (the "Convertible Preferred
Stock"), which such exchange to be structured to the extent possible in a
tax-free transaction to Delta pursuant to I.R.C. Section 368 (a)(1)(E). Any
shares of Convertible Preferred Stock held by Delta after the date of
issuance may be converted at Delta's option at any time into shares of
Priceline common stock at a one (1) to one (1) ratio (i.e. a zero percent
premium). The Convertible Preferred Stock will have a final maturity of ten
(10) years from the date of issue and
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be subject to a mandatory redemption at the tenth (10th) anniversary for
cash at a price per share of $59.93; provided that Priceline shall have a
call right for the Convertible Preferred Stock after three (3) years from
the date of issue for cash at a price per share of $59.93. To the extent
all or a portion of the Convertible Preferred Stock is called, Priceline
will provide Delta with 30 days' advance written notice so that Delta will
first have the right to convert its Convertible Preferred Stock during such
30 day period. Whether or not Priceline has exercised its call right, Delta
is guaranteed the first six semiannual dividends. The Convertible Preferred
Stock will be subordinated to any indebtedness of Priceline, will rank pari
passau with any existing or future preferred stock issued by Priceline, and
will have priority over the the common stock of Priceline. Delta will have
voting rights for the Convertible Preferred Stock as if Delta held an
equivalent number of Priceline common shares (i.e., on a one to one ratio).
In the event that Priceline issues a cash dividend to the holders of common
shares, then Delta shall be entitled to demand a cash dividend on the
Convertible Preferred Stock in lieu of the paid-in-kind dividend.
In the event of a change of control of Priceline where cash is a portion of
the consideration paid by the acquiring company, Delta will have the right
to elect to receive the greater of par (cash at a price per share of
$59.93) or the cash value of the transaction. If the transaction is for
stock, the exchange ratio will be adjusted such that Delta receives the
same monetary consideration for its Convertible Preferred Stock.
Priceline hereby confirms that such shares, when converted to Priceline
common stock, shall have demand and piggyback registration rights under the
existing Amended and Restated Registration Rights Agreement dated December
8, 1998 by and among Delta, Priceline, and other parties or any successor
or substitute registration rights agreement thereto.
The Convertible Preferred Stock will be subordinated to any indebtedness of
Priceline, will rank pari passau with any existing or future preferred
stock issued by Priceline, and will have priority over the the common stock
of Priceline. Delta will have voting rights for the Convertible Preferred
Stock as if Delta held an equivalent number of Priceline common shares
(i.e., on a one to one ratio). In the event that Priceline issues a cash
dividend to the holders of common shares, then Delta shall be entitled to
demand a cash dividend on the Convertible Preferred Stock in lieu of the
paid-in-kind dividend.
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1.6 Other Agreements
Priceline and Delta, respectively, shall execute and deliver the agreements
described in Article 6 to which either is a party.
ARTICLE 2 - CLOSING
2.1 Closing. The closing (the "Closing") of the transactions contemplated by
this Agreement shall take place immediately, following the satisfaction or
waiver of all of the conditions set forth in Article 6 hereof (the "Closing
Date").
ARTICLE 3 - REPRESENTATIONS AND WARRANTIES OF PRICELINE
Representations and Warranties of Priceline. Priceline represents and warrants
to Delta as follows:
3.1 Organization and Qualification. Priceline is a duly organized and validly
existing corporation in good standing under the laws of the State of Delaware
and has the corporate power and authority to own, operate and lease the
properties and assets it now owns, operates or leases and to conduct its
business as it is now being conducted.
3.2 Authority Relative to this Agreement. Priceline has the corporate power and
authority to execute and deliver this Agreement and to consummate the
transactions contemplated hereby in accordance with the terms hereof. The
execution and delivery of this Agreement and the consummation of the
transactions contemplated hereby have been duly authorized by all necessary
corporate action on the part of the Priceline. This Agreement has been duly and
validly executed and delivered by Priceline and is, assuming due execution and
delivery thereof by Delta and that Delta has full legal power and right to enter
into this Agreement, a valid and binding obligation of Priceline, enforceable
against Priceline in accordance with its terms, except as enforcement thereof
may be limited by the availability of certain equitable remedies or by
bankruptcy, insolvency or similar laws affecting creditors' rights generally.
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3.3 Broker. Priceline has not retained or agreed to pay any broker or finder
with respect to this Agreement and the transactions contemplated hereby, the
fees for which Delta may be responsible.
3.4 Shares Held by Delta. Priceline represents that, as of the date of the
Warrant Agreement, after giving effect to the Stock Purchase Agreement of
November 16, 1999, pursuant to which Xxx X. Xxxxxx purchased from Delta
2,085,767 shares of Priceline common stock at a price of $59.93 per share, the
remaining 14,440,067 shares of Priceline common stock held by Delta represent
approximately eight and eighty five hundredths percent (8.85%) of the
outstanding common stock of Priceline.
ARTICLE 4 - REPRESENTATIONS AND WARRANTIES OF DELTA
Representations and Warranties of Delta. Delta represents to Priceline
as follows:
4.1 Organization and Qualification. Delta is a duly incorporated and validly
existing corporation in good standing under the laws of the State of Delaware
and has the corporate power and authority to own, operate and lease the
properties and assets it now owns, operates or leases and to conduct its
business as it is now being conducted.
4.3 Authority Relative to this Agreement. Delta has the corporate power and
authority to execute and deliver this Agreement and to consummate the
transactions contemplated hereby in accordance with the terms hereof. The
execution and delivery of this Agreement and the consummation of the
transactions contemplated hereby have been duly authorized by all necessary
corporate action on the part of the Delta. This Agreement has been duly and
validly executed and delivered by Delta and is, assuming due execution and
delivery thereof by Priceline and that Priceline has full legal power and right
to enter into this Agreement, a valid and binding obligation of Delta,
enforceable against Delta in accordance with its terms, except as enforcement
thereof may be limited by the availability of certain equitable remedies or by
bankruptcy, insolvency or similar laws affecting creditors' rights generally.
4.3 Purchase for Investment.
(a) Delta understands that the shares of Convertible Preferred Stock to be
issued to Delta hereunder (the "Shares") have not been registered
under the Securities Act of 1933, as amended (the "Act"), or under
applicable
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state securities laws, in reliance upon exemptions contained in the
Act and such laws and any applicable regulations promulgated
thereunder or interpretations thereof, and cannot be offered for sale,
sold or otherwise transferred unless all or any portion of the Shares
subsequently are so registered or qualify for exemption from
registration under the Act and such laws and unless such offer, sale
or transfer is made in compliance with the terms of this Agreement and
that the certificate(s) representing the Shares shall bear the
following legends:
"THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAW.
THEY MAY NOT BE SOLD OR OFFERED FOR SALE, PLEDGED, HYPOTHECATED
OR OTHERWISE TRANSFERRED EXCEPT IN COMPLIANCE WITH SAID ACT."
(b) The Shares are being acquired under this Agreement by Delta
in good faith solely for its own account, for investment and not with
a view toward resale or other distribution within the meaning of the
Act; and such Shares will not be offered for sale, sold or otherwise
transferred without either registration or exemption from registration
under the Act.
(c) Delta is an "Accredited Investor" within the meaning of rule
501 of Regulation D under the Act, as presently in effect. Delta has
such knowledge and experience in financial and business matters that
it is capable of evaluating the merits and risks of its investment in
the Shares; and understands and is able to bear any economic risks
associated with such investment.
(d) Delta understands that the Shares will be considered
"restricted securities" within the meaning of Rule 144 under the Act;
that Rule 144 may not be available to exempt from the registration
requirements of the Act sales of such restricted securities; that if
Rule 144 is available, sales may be made in reliance upon Rule 144
only in accordance with the terms and conditions of Rule 144, which
among other things generally requires that the securities be held for
at least one year and that sales be made in limited amounts (which
amounts are subject to certain exceptions depending upon whether the
seller is an "affiliate" within the meaning of Rule 144 and how long
the securities have been held); and that, if the exemption for such
sales
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is not available, registration of the Shares under the Act and state
securities laws may be required.
4.4 Broker. Delta has not retained or agreed to pay any broker or finder with
respect to this Agreement and the transactions contemplated hereby, the fees for
which Priceline may be responsible.
ARTICLE 5 - FURTHER AGREEMENTS OF THE PARTIES
5.1 Governmental Filings. In connection with the consummation of the
transactions contemplated hereby, Priceline and Delta shall promptly file with
the SEC any required materials relating to the transactions contemplated by this
Agreement.
5.2 Reasonable Business Efforts. Upon the terms and subject to the conditions
of this Agreement, Delta and Priceline agree to use reasonable business efforts
to take, or cause to be taken, and to assist and cooperate with each other in
doing, all things reasonably necessary, proper or advisable under applicable
laws and regulations to consummate and make effective, in the most expeditious
manner practicable, the transactions contemplated by this Agreement.
5.3 Expenses; Payments. Each party hereto agrees to bear its own expenses
(including, without limitation, the reasonable fees and disbursements of
counsel) in connection with the negotiation and preparation of this Agreement
and its performance hereunder.
5.4 Warrant. On November 17, 1999, Priceline shall execute and deliver to Delta
a Participation Warrant Agreement in the form of Exhibit D attached hereto.
ARTICLE 6 - CONDITIONS TO OBLIGATIONS OF DELTA
Delta shall not be obligated to consummate the transactions contemplated by this
Agreement, unless the following conditions shall have been satisfied or, if
applicable, waived by Delta prior to or at the Closing.
6.1 Representations and Warranties. The representations and warranties of
Priceline contained herein shall be true, complete and accurate in all material
respects as of the Closing Date.
6.2 Xxxxxx Xxxxxxx shall have issued to Delta a letter in the form of Exhibit B
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attached hereto in which Xxxxxx Xxxxxxx releases the Market Sale Shares from the
Lock-Up that expires on February 7, 2000 (the "Lock-Up").
6.3 Xxx X. Xxxxxx, Xxxxxx Digital, Xxxxxxx Xxxxxxxx, Xxxx Xxxxxxx and Xxxxxxx
Xxxxx each shall have signed a letter agreement with Delta, in the form of
Exhibit C attached hereto, in which each agrees, during the period from the date
hereof until the Release Date, not to sell or transfer, directly or indirectly,
any Priceline securities.
6.4 Priceline shall have executed a Participation Warrant Agreement in the form
of Exhibit D attached hereto.
ARTICLE 7 - CONDITIONS TO OBLIGATIONS OF PRICELINE
Priceline shall not be obligated to consummate the transactions contemplated by
this Agreement unless the following conditions shall have been satisfied or, if
applicable, waived by Priceline prior to or at the Closing.
7.1 Representations and Warranties. The representations and warranties of Delta
contained herein shall be true, complete and accurate in all material respects
as of the Closing Date.
7.2 Amendments. Delta shall have executed and delivered the Amendment to the GA
and APA, substantially in the form of Exhibit A attached hereto.
ARTICLE 8 - TERMINATION
8.1 Certain Terminations. This Agreement may be terminated at any time prior to
the occurrence of the Closing: (a) by written agreement by Delta and Priceline;
or (b) by the party not in breach in the event of a material breach by the other
which is not cured within fifteen (15) days after written notice thereof.
8.2 Effect of Termination. In the event of the termination of this Agreement by
either Delta or Priceline, as provided above, this Agreement shall thereafter
become void and of no further force and effect and there shall be no liability
on the part of any party hereto or its directors, officers, stockholders,
employees or agents, except for any liability for any willful breach of this
Agreement causing or permitting such termination and except that the provisions
of Sections 5.3 and this Section 8.2 shall survive such termination. The
representations and warranties made herein shall survive the Closing.
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ARTICLE 9 - MISCELLANEOUS
9.1 Further Assurances. From time to time hereafter, each party shall, using
reasonable business efforts, execute and deliver such other instruments of
transfer and assumption and take such further action including providing access
to necessary books and records as the other may reasonably request to carry out
the transfer of the Assets and as otherwise may be reasonably required in
connection with effecting or carrying out the provisions of this Agreement.
9.2 No Waiver. Except as expressly provided in this Agreement, nothing
contained in this Agreement shall cause the failure of either party to insist
upon strict compliance with any covenant, obligation, condition or agreement
contained herein to operate as a waiver of, or estoppel with respect to, any
such or any other covenant, obligations, condition or agreement by the party
entitled to the benefits thereto.
9.3 Severability. If any provisions hereof shall be held invalid or
unenforceable by any court of competent jurisdiction or as a result of future
legislative action, such holding or action shall be strictly construed and,
subject to applicable law, shall not affect the validity or effect of any other
provisions hereof.
9.4 No Third Party Beneficiary. Nothing herein expressed or implied is intended
to or shall be construed to confer upon or give to any person or corporation
other than the parties hereto and their successors any rights or remedies under
or by reason of this Agreement.
9.5 Entire Agreement; Amendments. This Agreement contains and is intended as, a
complete statement of the entire agreement and understanding between the parties
with respect to the subject matter hereof and supersedes all prior statements,
representations, discussions, agreements, draft agreements and undertakings,
whether written or oral, express or implied, of any and every nature with
respect thereto. This Agreement cannot be changed or terminated orally. This
Agreement may only be amended by written agreement of Priceline and Delta.
9.6 Assignment. This Agreement shall be binding upon the successors and assigns
of the parties hereto, although no party shall be permitted to assign any of its
rights or delegate any of its duties under this Agreement without the consent of
the other party hereto.
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9.7 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Delaware applicable to agreements made
and to be performed in the State of Delaware.
9.8 Notices. All notices, requests, demands, and other communications under
this Agreement shall be in writing and shall be delivered personally (including
by courier) or mailed by registered mail, return receipt requested, or given by
facsimile transmission to the parties at the following addresses (or to such
other address as a party may have specified by notice given to the other
pursuant to this provision) and shall be deemed given when so received:
(a) if to Priceline, to:
xxxxxxxxx.xxx Incorporated
0 Xxxx Xxxxx Xxxx,
Xxxxxxxx, Xxxxxxxxxxx 00000
Attn: - General Counsel
Facsimile number: (000) 000-0000.
(b) if to Delta, to:
Delta Air Lines, Inc.
0000 Xxxxx Xxxxxxxxx Xxxxxxx, XX 00000
Attn: Senior Vice President - General Counsel
Facsimile number: (000) 000-0000.
9.9 Headings. The section headings of this Agreement are for reference purposes
only and are to be given no effect in the construction or interpretation of this
Agreement. All references herein to sections, unless otherwise identified, are
to sections of this Agreement.
9.10 Counterparts; Facsimile Signature. This Agreement may be executed by the
parties hereto in two or more counterparts, by facsimile or otherwise, each of
which shall be deemed to constitute an original, but together which shall
constitute one and the same instrument.
9.11 Indemnity Each party (the "Indemnifying Party") shall indemnify, defend,
compensate, and hold harmless the other, and the other's officers, directors,
employees, and representatives, to the fullest extent permitted by law, from and
against all
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damages, claims, liabilities, losses and attorneys' fees, arising out of or
relating to any breach of any representation, warranty, covenant or agreement in
this Agreement or any agreement signed by Delta or Priceline pursuant to
Article 6.
IN WITNESS WHEREOF, the undersigned have caused this Agreement to be executed as
of the date first above written.
XXXXXXXXX.XXX DELTA AIR LINES, INC.
INCORPORATED
/s/ XXXX X. XXXXXXX /s/ M. XXXXXXX XXXXX
----------------------- --------------------------
By: Xxxx X. Xxxxxxx By: M. Xxxxxxx Xxxxx
Title: Chief Financial Officer Title: Vice President & Treasurer
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EXHIBIT A
Amendment to the Airline Participation Agreement and the General Agreement
This Amendment ("Amendment"), dated the 17th day of November, 1999, amends the
Airline Participation Agreement ("APA") and the General Agreement ("GA"), dated
August 31, 1998, as amended, between and among Delta Air Lines, Inc. ("Delta")
and xxxxxxxxx.xxx Incorporated and PriceLine Travel, Inc. which merged with and
into xxxxxxxxx.xxx Incorporated on March 24, 1999 ("Priceline"). Unless
otherwise defined herein, capitalized terms shall have the meanings set forth in
the APA and the GA, as applicable.
1. The following provision replaces Section 3.1 of the GA in its entirety:
3.1 Subject to Section 3.5 below, Delta and Priceline agree that, during the
term of the GA and APA:
(a) Delta consents to the participation in Priceline by the U.S. carriers
identified in the attached Schedule 3.1; subject to the following
restrictions:
(i) Priceline shall not issue tickets on Northwest Airlines to or from
ATL, except for the following O&D markets: DTW-ATL, MSP-ATL, and MEM-ATL;
(ii) Priceline shall not issue tickets on Continental Airlines to or
from ATL, except for the following O&D markets: EWR-ATL, CLE-ATL,
HOU-ATL and IAH-ATL;
(iii) Priceline shall not issue tickets on United Airlines to or from
ATL, except for the following O&D markets: XXX-XXX, XXX-XXX, XXX-XXX,
and IAD-ATL;
(iv) Priceline shall not issue tickets on USAirways to or from ATL, BOS
or LGA except for the following O&D markets: PIT-ATL/BOS/LGA,
PHL-ATL/BOS/LGA, and CLT-ATL/BOS/LGA. Notwithstanding the above
restriction, Priceline may issue tickets on USAirways to or from BOS or
LGA in O&D markets not served by nonstop flights operated by Delta or a
carrier operating a flight under Delta's two letter "DL" designator
code, provided, that Priceline shall restrict its ticket BOS or LGA
sales on USAirways within thirty (30) days of any new nonstop BOS or
LGA service offered by Delta or a carrier operating a flight under
Delta's two letter "DL" designator code; and
(v) Priceline shall not issue tickets on American Airlines to or from
ATL, except for the following O&D markets: ORD-ATL, DFW-ATL and
MIA-ATL. In the event that American Airlines (or an affiliate of
American Airlines), merges with or acquires substantial assets of
USAirways in Boston, then, in addition to the ATL market restriction,
Priceline shall not issue tickets on American Airlines to or from BOS,
except for the following O&D markets: ORD- BOS, DFW- BOS
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and MIA- BOS; provided, that Priceline may issue tickets on American
Airlines to or from BOS in O&D markets not served by nonstop flights
operated by Delta or a carrier operating a flight under Delta's two
letter "DL" designator code subject to; provided, further, that
Priceline shall restrict its BOS ticket sales on American within
thirty (30) days of any new nonstop BOS service offered by Delta or a
carrier operating a flight under Delta's two letter "DL" designator
code. In the event that American acquires or operates a hub airport in
PIT, PHL or CLT as a result of the acquisition of substantially all of
the assets of USAirways in PIT, PHL or CLT, then Priceline may issue
tickets on American Airlines, respectively, in the PIT-ATL, PHL-ATL,
or CLT-ATL markets, respectively.
(b) Delta consents to the participation in Priceline by the International
Carriers identified in the attached Schedule 3.1; subject to the following
restrictions:
(i) Priceline shall not issue tickets for international travel on
Austrian Airlines, Sabena, Swissair, AeroMexico, Air Jamaica, Korean
Airlines, Air Canada, All Nippon Airways, El Al Israel Airlines,
Qantas, Japan Airlines, Alitalia and Aerolineas Argentinas to or from
ATL or BOS, except for offers originating from O&D markets not served
by Delta or a carrier operating a flight under Delta's two letter
("DL") designator code.
(c) Notwithstanding the restrictions set forth in Section 3.1(a) and
3.1(b), Priceline may, in addition to other rights set forth in this
Amendment issue tickets (i) on Turkish Airlines solely in the New York
(JFK) - Istanbul, Turkey O&D market, (ii) on flights operated by
Participating Airlines in O&D markets not served by Delta or a carrier
operating a flight under Delta's two letter designator code, and (iii) on
code share flights operated by third party carriers (including commuter
carriers) where the Participating Carrier's two letter designator code used
to identify its flights (as published and used in the Official Airline
Guide (OAG), computer reservation systems (CRS's) and internal reservations
systems) appears in the carrier code box of the flight coupon; provided,
that the market restrictions set forth in Section 3.1(a) and 3.1(b) are
applicable to such code share flights.
(d) Priceline shall not issue tickets on carriers that are not listed on
Schedule 3.1. The participation of other domestic and international
carriers in Priceline, and the sale of tickets on such carriers, is subject
to Delta's prior written consent. Delta agrees to meet with Priceline to
discuss objective criteria by which new international participants could be
added.
(e) For purposes of Section 3.1, an O&D market shall be considered to be
served by Delta or a carrier operating a flight under Delta's two letter
designator code at any time scheduled service is offered for sale by one or
more such carriers.
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2. The following test is added as Section 7.15 (f) of the GA:
Reporting Audit Rights:
The General Agreement will be amended to state that Priceline will make
available (at no cost to Delta) to all Participating Airlines, on an agreed
production schedule, the following information for all Domestic and
International markets in which such Participating Airlines provide fares and
availability ("Applicable O&D's"):
- Methodology for determination of "Reasonable Demand" where "Reasonable
Demand" denotes offers acceptable to Priceline for possible fulfillment
- Notification of changes to "Reasonable Demand" methodology
- O&D routing, number of passengers, revenue, and average fare data for
all Priceline tickets for each Participating Airline
The above data will be made available to each Participating Airline no later
than 30 days following the end of each calendar month in the case of segment
data and each calendar quarter in the case of data relating to number of
passengers, revenue and average fare data.
- With respect to Delta only
- Weekly frequency distribution of offer price demand by applicable O&D to
include mode, range, minimum/maximum level, mean, median, standard
deviation and bid price trends
- As soon as practical but in any case within six months, make available to
Delta with weekly detail and summary report that identifies rejected
offers and the reasons leading to the rejections (e.g., "bid was too low
by $20, no "L" inventory LGA-ATL Nov 1)
- Priceline will continue to provide to Delta all the data it currently
submits on a regular basis (i.e., Delta Air Lines' Weekly Ticket Report -
Summaries of Ticket Sales by O&D - Domestic and International), including
data routinely submitted in response to Delta ad hoc requests.
Priceline will disclose bookings through Priceline in a format comparable to the
CRS MIDT data on a weekly basis and Priceline shall make available such data to
all Participating Carriers.
Priceline agrees to make available to Delta the audit plan and the report
prepared by priceline's auditors concerning Priceline's compliance with the
Participation Agreement and Delta General Agreement. In addition, Delta will
have the right to audit Priceline for compliance on all contractual market,
product, and other agreements and to receive regular reports measuring
compliance to such contractual terms.
3. The following provision replaces Section 7.11 of the General Agreement in its
entirety:
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7.11 All Participating Carriers will be given the first opportunity to
fill a customer ticket request based on a formula which allocates such
requests in proportion to the aggregate domestic or international
market share (as applicable) of each Participating Carrier for each O&D
requested. If a Participating Carrier fails to respond to a ticket
request on its designated first look, then Priceline will allocate the
request through a second round of preferred looks, which will be
allocated in proportion to the aggregate domestic or international
market shares (as applicable) of all remaining Participating Carriers
for each O&D requested (but excluding the Participating Carrier that
failed to fulfill the ticket request on the first look).
4. The following provision replaces Article III of the Airline Participation
Agreement in its entirety:
III. Priceline Ticket Allocation Methodology
All Participating Carriers will be given the first opportunity to fill
a customer ticket request based on a formula which allocates such
requests in proportion to the aggregate domestic or international
market share (as applicable) of each Participating Carrier for each O&D
requested. If a Participating Carrier fails to respond to a ticket
request on its designated first look, then Priceline will allocate the
request through a second round of preferred looks, which will be
allocated in proportion to the aggregate domestic or international
market shares (as applicable) of all remaining Participating Carriers
for each O&D requested (but excluding the Participating Carrier that
failed to fulfill the ticket request on the first look).
5. Except as provided herein, all other terms and conditions of the APA and
the GA shall remain in full force and effect. In the event any term or
provision of the APA or the GA is contrary to or inconsistent with this
Amendment, the terms of this Amendment shall control.
XXXXXXXXX.XXX DELTA AIR LINES, INC.
INCORPORATED
-------------------------- -----------------------------------
By: Xxxx X. Xxxxxxx By: M. Xxxxxxx Xxxxx
Title: Chief Financial Officer Title: Vice President & Treasurer
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SCHEDULE 3.1
US CARRIERS
Alaska Airlines
American Airlines
America West Airlines
Continental Airlines
Hawaiian Airlines
Midway Airlines
Northwest Airlines
Sky West
Trans World Airlines
Trans States
USAirways
United Airlines
INTERNATIONAL CARRIERS
Air Jamaica
Aer Lingus
Aerolineas Argentinas
Aeromexico
Air Canada
Air France
Air New Zealand
Alitalia
All Nippon Airways
Austrian Airlines
Cathay Pacific Airways
El Al Israel Airlines
Iberia
Icelandair
Korean Air Lines
Japan Airlines
Lufthansa
Malaysia Airlines
Qantas
SAS (Scandinavian Airlines)
Singapore Airlines
Sabena
South African Airways
Swissair
Varig
Virgin Atlantic
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