EXHIBIT 10.8
Note: Portions of this exhibit indicated by "[*]" are subject to a confidential
treatment request, and have been omitted from this exhibit. Complete, unredacted
copies of this exhibit have been filed with the Securities and Exchange
Commission as part of this company's confidential treatment request.
CRS MARKETING, SERVICES AND DEVELOPMENT AGREEMENT
This CRS MARKETING, SERVICES AND DEVELOPMENT AGREEMENT, dated and effective
as of December 15, 1995 (the "Agreement"), by and between MICROSOFT CORPORATION,
a Washington corporation, with its principal office at Xxx XXXXXXXXX Xxx,
Xxxxxxx, Xxxxxxxxxx 00000 ("MICROSOFT"), and WORLDSPAN, L.P., a Delaware limited
partnership, with its principal office at 000 Xxxxxxxx Xxxxxxx XX, Xxxxxxx,
Xxxxxxx 00000 ("WORLDSPAN")
RECITALS
WORLDSPAN operates a computerized reservations system and provides
information and other transaction processing to airlines, travel agents and
others in the travel industry.
MICROSOFT develops software and operates an Online System in the United
States and throughout the world.
MICROSOFT desires to retain WORLDSPAN to provide travel related transaction
and data processing and other services, and WORLDSPAN desires to provide same,
all according to this Agreement;
Now, Therefore, in consideration of the above recitals, the mutual
undertakings of the parties as contained herein and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties to this Agreement hereby agree as follows:
1. Definitions
-----------
Except as otherwise defined in this Agreement, terms used herein in
capitalized form shall have the meanings set forth in Schedule 1.
2. WORLDSPAN's Obligations
-----------------------
2.1.1 WORLDSPAN shall provide MICROSOFT access to the WORLDSPAN
System through Super Transaction, Standard Message Interface, and such other
communication protocols as WORLDSPAN may develop from time to time. WORLDSPAN
shall through proprietary and leased communications facilities allow access to
the WORLDSPAN System to MICROSOFT's communications node in Bellevue, Washington.
2.1.2 The parties acknowledge that neither can accurately forecast
the volume of transactions that will be generated by MICROSOFT System users with
the WORLDSPAN System. To ensure reasonable capacity is available, WORLDSPAN
shall make available to MICROSOFT not later than August 14, 1996, processing
capacity from the WORLDSPAN System according to the specifications set forth on
Schedule 2.1.2 attached hereto and as otherwise provided in this Agreement.
Thereafter, the parties shall confer periodically for the purpose of modifying
these minimum standards. Notwithstanding the foregoing, WORLDSPAN acknowledges
that the standards set forth herein and to be agreed upon are the minimum
standards necessary to service MICROSOFT System users and that adequate
WORLDSPAN System
resources are critical to the use of the MICROSOFT System travel related
services for their intended purposes.
2.2 WORLDSPAN shall be responsible for acquiring any hardware and
developing, at its expense, all of the software and systems necessary and
appropriate for delivery of the CRS Services to the MICROSOFT node according to
this Agreement. Improvements, changes and enhancements to the WORLDSPAN System
to be developed by WORLDSPAN to implement MICROSOFT's access to the WORLDSPAN
System and the schedule for such development are included on Schedule 2.2
attached hereto and incorporated herein by this reference.
2.3 Upon MICROSOFT's request, WORLDSPAN shall provide, at its own
expense, engineering, communications and technical support on-site at
MICROSOFT's facilities in Redmond, Washington until the Rollout Date to a
maximum of two (2) Person Months in any twelve (12) month period. This on-site
support will be provided by WORLDSPAN to: (a) assist MICROSOFT in installing and
utilizing the communication's link between the MICROSOFT System and the
WORLDSPAN System; (b) provide support for translation of MICROSOFT System users'
entries into the appropriate set of Super Transactions and input values; and (c)
trouble-shoot and repair problems with any of the foregoing.
2.4 WORLDSPAN shall provide to MICROSOFT telephone access to
WORLDSPAN's production and technical personnel or contractors to respond to
MICROSOFT personnel with questions and problems arising out of access to the
WORLDSPAN System by MICROSOFT System users. WORLDSPAN shall use reasonable
business efforts to make the necessary personnel available twenty four (24)
hours each day.
2.5 WORLDSPAN shall not disclose any information created by a
MICROSOFT System user or use such information except as necessary for the
performance of this Agreement (including as reasonably needed by WORLDSPAN to
complete and facilitate travel transactions generated by Microsoft System users,
and/or to adequately service WORLDSPAN's Travel Suppliers), except that
WORLDSPAN may disclose information from a reservation as required by law.
WORLDSPAN acknowledges and agrees that MICROSOFT will have data privacy
obligations to its customers which MICROSOFT will need to be respected by
WORLDSPAN. WORLDSPAN agrees to comply with all MICROSOFT data privacy
requirements communicated in writing by MICROSOFT to WORLDSPAN except where to
do so would be commercially unreasonable due to the costs of implementation
(where costs may not include foregone revenue from the sale or use of such
data).
3. Services
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3.1 During the Term, WORLDSPAN shall make available to MICROSOFT the
CRS Services in accordance with the performance standards set forth in Schedule
2.1.2. Such performance standards in general are intended to reflect the service
levels provided to any Travel Agent customer of WORLDSPAN. WORLDSPAN shall not
be responsible for WORLDSPAN System unavailability or any Response Time in
excess of agreed limits due to: (a) scheduled maintenance or scheduled downtime,
(b) actions or inactions of MICROSOFT or MICROSOFT System users, (c) failure of
any part of the WORLDSPAN Network operated by a third party supplier, or (d)
outages caused by the failure of public network components.
2
3.2 Nothing herein shall prohibit MICROSOFT from obtaining any travel
information or CRS Services from any entity other than WORLDSPAN for use with
the MICROSOFT System and nothing shall prohibit WORLDSPAN from providing any
travel information or CRS Services to any Online System provider or other
person.
3.3 MICROSOFT shall provide to WORLDSPAN the information, data and
necessary technical and human resources to permit WORLDSPAN to complete
WORLDSPAN's development of improvements, changes and enhancements to the
WORLDSPAN System and to provide access to the WORLDSPAN System and the CRS
Services.
4. Access To CRS Services And Rights
---------------------------------
4.1 Subject to Section 4.3 and during the Term, WORLDSPAN hereby
grants to MICROSOFT a nonexclusive right and license in and to all of the
functions, services, information and data available through the WORLDSPAN System
to all of WORLDSPAN's Travel Agent customers including, but not limited to, the
CRS Services.
4.2 WORLDSPAN also grants to MICROSOFT a worldwide, non-exclusive,
right and license during the Term of this Agreement in WORLDSPAN Training
Materials for the sole purpose of permitting MICROSOFT to create, publish, and
distribute training books, manuals, software programs and other materials for
the use of MICROSOFT employees, contractors and MICROSOFT System users. Within a
reasonable period following termination of this Agreement not to exceed sixty
(60) days, MICROSOFT shall, at its option, return to WORLDSPAN or destroy all of
the WORLDSPAN Training Materials and all copies of books, manuals, software or
other materials containing WORLDSPAN Training Materials, then in the possession
of MICROSOFT.
4.3 The license and the rights granted in Section 4.1 herein shall be
limited to the Territory and shall permit MICROSOFT to utilize information,
data, functions and services from the WORLDSPAN System, including the CRS
Services, to provide such information, data, functions and services through an
Online System to permit, among other things, users to review travel related
information, make reservations, and request tickets and other documents for
travel. Notwithstanding anything to the contrary herein, such restriction of
MICROSOFT's license rights to the Territory shall mean only that MICROSOFT shall
not actively market or advertise the availability of the travel services and
information provided through the WORLDSPAN System as part of the MICROSOFT
System outside of the Territory, and such restriction shall place no limitation
on MICROSOFT's right which is permitted by this Agreement to operate the
MICROSOFT System and to provide travel services and information via the
WORLDSPAN System over the Internet, the World Wide Web, The Microsoft Network,
or any other Online System. As used in this Section 4.3, to "actively market or
advertise" outside the Territory shall mean to undertake actual marketing or
advertising activities in local markets outside the Territory, but shall not
include marketing or advertising activities done generally over the Internet,
the World Wide Web, The Microsoft Network, or any other Online System regardless
of the fact that such activities may be accessible to persons outside the
Territory. With respect to information and data regarding hotels and other
lodging services, WORLDSPAN also grants to MICROSOFT a perpetual, worldwide
license and right to: (a) develop, market, sell, make, use, reproduce, modify,
adapt, create derivative works based on, translate, distribute, (directly and
indirectly), transmit, display and perform publicly, license, rent, lease, and
sell such information and data on printed, electronic or other fixed media, and
to sublicense any or all of the foregoing rights, including the right to
sublicense such rights to third parties; and (b) create, develop, market,
distribute, transmit, license, sub-license and sell such information and data
through broadcast, cable or satellite television distribution, interactive and
otherwise. Such license to information and data regarding hotels and other
lodging services shall be subject to such future restrictions as may be imposed
on WORLDSPAN by its suppliers of such information, but only to the extent that
such restrictions are communicated in advance and in writing to MICROSOFT.
3
4.4 Subject to the provisions of Section 7.5 herein, WORLDSPAN
retains the right to modify and enhance the WORLDSPAN System in its sole
discretion at any time during the Term, including but not limited to, the right
to migrate MICROSOFT and MICROSOFT System users to new computer reservation
systems created or used by WORLDSPAN, provided that any such modifications,
enhancements and/or migration shall not materially adversely alter any of the
CRS Services, including specifically the functionality associated with the
development items set forth on Schedule 2.2 attached hereto. MICROSOFT agrees
that it will take reasonable steps to administer the use of the WORLDSPAN System
by MICROSOFT System Users, including but not limited to using all commercially
reasonable efforts to terminate the access of such users who MICROSOFT or
WORLDSPAN determines use the WORLDSPAN System improperly. Improper use of the
WORLDSPAN System shall include: transmitting personal messages; making
speculative or improper bookings; training anyone other than MICROSOFT
employees, contractors or MICROSOFT System users; entering passive booking codes
(e.g., GK, HK, MK or BK codes) when no corresponding space has been reserved
with the transporting carrier's internal reservation system; or failing to
remove such passive bookings from the WORLDSPAN System if the corresponding
space is canceled via telephone or by other means.
5. MICROSOFT's Obligations
-----------------------
MICROSOFT will develop, at its own expense, the capability for
MICROSOFT System users to make reservations on airlines, cars, hotels, tours,
cruises and other products and services distributed through the WORLDSPAN
System. For a five (5) month period following implementation of the WORLDSPAN
System through the MICROSOFT System, MICROSOFT will use reasonable business
efforts to construct its travel reservations facilities available through the
MICROSOFT System in a way to promote the making of reservations and bookings to
generate a stream of chargeable transactions through the WORLDSPAN System.
Thereafter, MICROSOFT and WORLDSPAN shall agree upon the appropriate level of
promotion of the WORLDSPAN System given the then-existing business
circumstances. MICROSOFT makes no representation or warranty about the volume of
chargeable transactions that will be generated by MICROSOFT System users or the
ratio of chargeable transactions to total transactions.
6. Attribution
-----------
At WORLDSPAN's request, MICROSOFT shall include in a screen or page
provided as a part of any fixed media product utilizing data or information
provided from the WORLDSPAN System that WORLDSPAN has supplied such data or
information.
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7. Term
----
7.1 Unless earlier terminated as provided herein, the term of this
Agreement (the "Term") shall commence as of the date first written above on page
one, and shall continue thereafter for a period of ten (10) years.
7.2 This Agreement may be terminated as follows:
7.2.1 Either WORLDSPAN or MICROSOFT may terminate this Agreement
(a) following six (6) months prior notice if the parties have failed to reach an
agreement according to either Section 2.1.2 or Section 11.2 or Schedule 2.1.2 of
this Agreement, or (b) upon the occurrence of an Event of Default by the other
party.
7.2.2 An Event of Default with respect to MICROSOFT shall mean
that:
(a) MICROSOFT defaults in making any payment hereunder
when the same becomes due and payable, and such default continues for a
period of thirty (30) days after notice thereof in writing from WORLDSPAN;
or
(b) MICROSOFT fails to comply with any of its other
material covenants or agreements in this Agreement and such default
continues for a period of thirty (30) days after notice thereof in writing
from WORLDSPAN.
7.2.3 An Event of Default with respect to WORLDSPAN shall mean
that:
(a) WORLDSPAN fails to provide the CRS Services, which
failure is not cured by WORLDSPAN not more than sixty (60) days after
notice thereof in writing from MICROSOFT; or
(b) WORLDSPAN fails to comply with any of its other
material covenants or obligations in this Agreement and such default
continues for a period of thirty (30) days after notice thereof in writing.
7.3 If MICROSOFT makes any assignment for the benefit of creditors or
becomes insolvent, or if WORLDSPAN has reason to believe MICROSOFT is not
generally paying its bills when due, or if federal, state or common law
bankruptcy or insolvency proceedings are commenced with respect to MICROSOFT, or
if a receiver of MICROSOFT assets is appointed, or if MICROSOFT shall take any
step leading to its cessation as a going concern, or if MICROSOFT shall cease
operations for reasons other than a strike, then in any of the foregoing events
WORLDSPAN may immediately cancel this Agreement on notice to MICROSOFT, or, at
WORLDSPAN's option require MICROSOFT to give adequate assurance of future
performance of this Agreement by immediately curing any default hereunder and
establishing any irrevocable letter of credit issued by a bank and on terms and
conditions acceptable to WORLDSPAN in an amount sufficient to cover all amounts
potentially due from MICROSOFT under this Agreement and which may be drawn upon
WORLDSPAN upon the sole condition that MICROSOFT does not fulfill its
obligations under this Agreement in a timely manner.
5
7.4 If WORLDSPAN makes any assignment for the benefit of creditors or
becomes insolvent, or if MICROSOFT has reason to believe WORLDSPAN is not
generally paying its bills when due, or if federal, state or common law
bankruptcy or insolvency proceedings are commenced with respect to WORLDSPAN, or
if a receiver of WORLDSPAN's assets is appointed, or if WORLDSPAN shall take any
step leading to its cessation as a going concern, or if WORLDSPAN shall cease
operations for reasons other than a strike, then in any of the foregoing events
MICROSOFT may immediately cancel this Agreement on notice to WORLDSPAN, or, at
MICROSOFT's option require WORLDSPAN to give adequate assurance of future
performance of this Agreement by immediately curing any default hereunder and
establishing any irrevocable letter of credit issued by a bank and on terms and
conditions acceptable to MICROSOFT in an amount sufficient to cover all amounts
potentially due from WORLDSPAN under this Agreement and which may be drawn upon
MICROSOFT upon the sole condition that WORLDSPAN does not fulfill its
obligations under this Agreement in a timely manner.
7.5 MICROSOFT shall have the option to terminate this Agreement upon
written notice to WORLDSPAN in the event that WORLDSPAN migrates MICROSOFT and
MICROSOFT System users to a computer reservation system not operated by
WORLDSPAN. In addition, either party may terminate this Agreement upon written
notice to the other in the event of an assignment of this Agreement by the other
party to a third party. For purposes of this Section 7.5, an assignment shall
include (i) any transfer of an ownership interest in WORLDSPAN or MS to a
person, group, or entity that would result in that person, group or entity
acquiring control of such party, or (ii) any transfer by either party of all or
substantially all of its assets.
8. Additional Development Services
-------------------------------
In addition to development otherwise required to be done by WORLDSPAN
pursuant to this Agreement, MICROSOFT may request that WORLDSPAN develop
additional enhancements, improvements or changes to the WORLDSPAN System for the
benefit of MICROSOFT System users. Subject to the availability of programming
resources and provided the enhancements, improvements, or changes do not
adversely impact the existing performance standards of the WORLDSPAN System,
WORLDSPAN shall provide Additional Development Services to complete such
requested development.
9. Charges/Payment
---------------
9.1 MICROSOFT shall pay WORLDSPAN'S standard hourly rate for
Additional Development Services provided pursuant to this Agreement.
9.2 MICROSOFT shall pay all amounts hereunder calculated pursuant to
the formulas and otherwise in the manner set forth in this Agreement. Payment
shall be made within thirty (30) days of each monthly invoice.
6
10. Ownership, No Other License
---------------------------
10.1 The WORLDSPAN System, including all Intellectual Property
Rights therein, shall be owned or retained, to the fullest extent legally
permitted under all applicable laws, by WORLDSPAN. MICROSOFT shall execute such
instruments, agreements and acknowledgments as WORLDSPAN shall require to
transfer and assign any and all of MICROSOFT's rights in and to such
Intellectual Property Rights therein to WORLDSPAN. In addition to any other
rights WORLDSPAN may have, WORLDSPAN shall be permitted to license or market to
any third party all or portions of the WORLDSPAN System or the WORLDSPAN
Software.
10.2 The MICROSOFT System, including all Intellectual Property
Rights therein, shall be owned or retained, to the fullest extent legally
permitted under all applicable laws, by MICROSOFT. WORLDSPAN shall execute such
instruments, agreements and acknowledgments as MICROSOFT shall require to
transfer and assign any and all of WORLDSPAN's rights in and to such
Intellectual Property Rights therein to MICROSOFT. In addition to any other
rights MICROSOFT may have, MICROSOFT shall be permitted to license or market to
any third party all or portions of the MICROSOFT System or the MICROSOFT
Software.
10.3 Nothing herein shall be construed as granting or conferring
upon a party a license or right to use the name or any Trademark, logo, or xxxx
of the other party.
11. Financial Arrangements
----------------------
11.1 WORLDSPAN acknowledges that the MICROSOFT System is a new
service and, accordingly, neither MICROSOFT nor WORLDSPAN can anticipate the
number of transactions through the WORLDSPAN System that will be generated by
MICROSOFT System users nor all of the revenues or expenses that will accrue to
either party or the number of transactions that will be generated by MICROSOFT
System users. As additional consideration for the promises made by WORLDSPAN in
this Agreement, MICROSOFT agrees that if revenues payable by Travel Suppliers to
WORLDSPAN for transactions generated by MICROSOFT System users are less than One
Hundred Thousand Dollars ($100,000.00) during the five (5) month period
following implementation of the WORLDSPAN System through the MICROSOFT System
(including the development items set forth on Schedule 2.2), then MICROSOFT
shall pay to WORLDSPAN:
(i) the amount by which the actual amount of revenues payable is less than
$100,000.00; and
(ii) the amount equal to WORLDSPAN's out of pocket costs paid to third
party telecommunications suppliers for the leased communications lines from
the WORLDSPAN System to the Microsoft System in Bellevue, Washington.
WORLDSPAN shall make available to MICROSOFT upon request any of its books,
records and regularly generated reports as are reasonably necessary to confirm
the average amounts charged for air bookings in 1995 and 1996.
7
11.2 Other than payments made by MICROSOFT for Additional
Development Services and the amount to be paid by MICROSOFT, if any, pursuant to
section 11.1 above, MICROSOFT and WORLDSPAN agree that each shall bear any and
all expenses incurred in the performance of this Agreement and each shall be
entitled to retain any and all revenues arising out of this Agreement for the
period ending January 31, 1997. Not later than August 1, 1996, the parties shall
begin to confer for the purposes of determining the need for making any change
to the financial aspects of this Agreement for the period after January 31,
1997, principally the sharing of revenues received by WORLDSPAN from Travel
Suppliers for bookings and reservations made by MICROSOFT System users and
expenses incurred by WORLDSPAN in excess of the anticipated expenses. In the
event the parties are unable to agree to the financial aspects by November 30,
1996, either party may terminate this Agreement pursuant to Section 7.2.
12. Confidentiality
---------------
12.1 The Non Disclosure Agreement shall be in effect throughout the
Term and shall continue according to its terms.
12.2 Notwithstanding the foregoing, if either party receives a
subpoena, civil investigative demand, or any other order, demand or request for
the Confidential Information of the other party (the "Owning Party"); or if
there is any change in law, statute or regulation that requires the disclosure
or delivery of such information to any third party, then the party that would
respond or otherwise be required to make the delivery, disclosure or response
shall give written notice to the Owning Party. The Owning Party shall have ten
(10) business days following such notice to make any motion to quash, file any
objection or protest, or otherwise take any action deemed necessary and
appropriate to prevent such disclosure and, during such ten (10) day period, the
other party will make no delivery, disclosure or response with respect to the
Confidential Information of the Owning Party.
13. Force Majeure
-------------
13.1 WORLDSPAN shall have no liability to MICROSOFT or any other
person for malfunctions, errors or interruptions in the operation of the
WORLDSPAN System or non-performance or delays in performance hereunder caused by
acts of God, strikes, labor disputes, fires, delays of suppliers of goods or
services, acts or omissions of sovereign states or airline industry associations
(including but not limited to ATA, ACH, ARC and IATA) or for any other cause
beyond the control of WORLDSPAN, and no such malfunction, interruption, non-
performance or delay shall constitute an Event of Default with respect to
WORLDSPAN or MICROSOFT hereunder.
13.2 MICROSOFT shall have no liability to WORLDSPAN or any other
person for malfunctions or interruptions in the operation of the MICROSOFT
System or non-performance or delays in performance hereunder caused by acts of
God, strikes, labor disputes, fires, delays of suppliers of goods or services,
acts or omissions of sovereign states or airline industry associations
(including but not limited to ATA, ACH, ARC and IATA) or for any other cause
beyond the control of MICROSOFT, and no such malfunction, interruption, non-
performance or delay shall constitute an Event of Default with respect to
MICROSOFT or WORLDSPAN hereunder.
8
14. Indemnification
---------------
14.1 WORLDSPAN and MICROSOFT each agree to indemnify, defend and
hold harmless the other and the other's directors, officers, partners,
affiliates, and employees from any and all Loss arising out of: (a) the death or
bodily injury of any agent, employee, contractor, customer, business invitee or
business visitor of the indemnitor; and (b) the damage, loss or destruction of
any real or tangible personal property of the indemnitor, including but limited
to the loss of use thereof.
14.2 WORLDSPAN and MICROSOFT each agree to indemnify, defend and
hold harmless the other and the other's directors, officers, partners,
affiliates, and employees from any and all Loss arising out of any claims or
infringement of any Intellectual Property Right conferred by contract or by
common law or by any law of the United States or any state alleged to have
occurred because of any service, data, or Confidential Information provided or
work performed by the indemnitor; provided, however, that this indemnity shall
not apply unless the party claiming indemnification notifies the other promptly
of any matters in respect of which the foregoing indemnity may apply and of
which the notifying party has knowledge and gives the other full opportunity to
control the response thereto and defense thereof, including, without limitation
any agreement relating to the settlement thereof.
14.3 MICROSOFT agrees to indemnify, defend, and hold harmless
WORLDSPAN and its directors, officers, partners, affiliates, and employees from
any and all Loss incurred by WORLDSPAN arising out any claim by a MICROSOFT
System user using the WORLDSPAN System, except for or to the extent that any
such Loss is due to the negligence of WORLDSPAN.
14.4 WORLDSPAN agrees to indemnify, defend, and hold harmless
MICROSOFT and its directors, officers, partners, affiliates, and employees from
any and all Loss incurred by MICROSOFT arising out any claim by a MICROSOFT
System user using the WORLDSPAN System to the extent that any such Loss is due
to the negligence of WORLDSPAN.
14.5 Each of the indemnities set forth in this Section shall apply
to each applicable Loss described above that results from any cause (including
the negligence of the indemnified party) but shall not apply to the extent such
applicable loss results solely from the gross negligence or willful misconduct
of the indemnified party or such indemnity is otherwise prohibited by applicable
law.
15. Insurance
---------
15.1 WORLDSPAN shall maintain a Comprehensive General Liability
insurance policy, including worldwide coverage, in the amount of no less than
U.S. One Million and no/100 Dollars ($1,000,000.00) per occurrence with a U.S.
Two Million and no/100 Dollars ($2,000,000.00) aggregate. Such coverage shall
include contractual liability coverage for the indemnification obligations
contained herein, products hazard coverage and broad form property coverage. In
addition, WORLDSPAN shall maintain an umbrella liability insurance policy or
policies in an amount no less than U.S. Five Million and no/100 Dollars
($5,000,000.00).
9
15.2 WORLDSPAN shall maintain the insurance or policies as required
in subsection 15.1 above as follows:
15.2.1 WORLDSPAN hereto shall provide to MICROSOFT a
Certificate of Insurance, in a form reasonably acceptable to MICROSOFT, for each
of the policies of insurance required by this Section. Each Certificate of
Insurance with respect to the policies of insurance required by this Section
must name MICROSOFT as an additional insured.
15.2.2 Each insurance policy including renewal insurance, or
Certificates of Insurance shall contain an agreement by the insurer that it
shall give no less than thirty (30) days written notice of cancellation, intent
not to renew, or reduction of material change in coverage. WORLDSPAN shall
provide MICROSOFT no less than ten (10) days prior written notice of any such
notice set forth in this Section.
15.2.3 Each Certificate of Insurance required hereby shall be
delivered to MICROSOFT within ten (10) business days after the effective date or
renewal of the respective policy, as applicable.
16. Regulatory Compliance
---------------------
WORLDSPAN and MICROSOFT shall comply with all ATA, ACH, ARC, IATA and other
travel industry and other governmental and regulatory rules and regulations, and
all laws, statutes, ordinances and regulations in each case, applicable to this
Agreement, to the parties, and to the services provided hereunder. WORLDSPAN
reserves the right to modify or eliminate any CRS Service if the provision of
such service might constitute a violation of any applicable statute, law,
ordinance, industry rule or regulation or order of a court or judicial or
administrative body.
17. Successors
----------
Neither party shall assign its interest in this Agreement; provided,
however, that (subject to Section 7.5) either party may assign this Agreement
upon thirty (30) days prior written notice to a wholly-owned subsidiary or to an
entity to which substantially all of the assets of the assigning party are being
transferred if such assignee assumes and agrees to perform all of the
obligations of the assignor. This Agreement shall be binding upon the parties
hereto and their successors and assigns and all persons claiming under or
through them or any such successor or assign.
18. Entire Agreement
----------------
This Agreement and the Non Disclosure Agreement, together with any
appendices, schedules and exhibits to either this Agreement and the Non
Disclosure Agreement, constitute the entire agreement and understanding of the
parties and supersedes all other prior agreements and understandings, both
written and oral, between the parties with respect to the subject matter hereof.
This Agreement and the Non Disclosure Agreement may be amended only by a further
writing duly executed by authorized representative of the parties.
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19. Governing Law
-------------
19.1 Governing Law. This agreement shall be governed by, and shall
-------------
be performed, enforced and construed in accordance with, the laws of the United
States and the State of Washington (other than its rules on conflicts of laws).
19.2 Jurisdiction, Forum. Each Party irrevocably submits to the
-------------------
non-exclusive jurisdiction of the Courts of the State of Georgia and Washington
and the United States Federal Courts sitting in Georgia and Washington. Each
party shall appoint an agent for services of process in the States of Georgia
and Washington (and notify the other party of the name and address of such
agent) and shall maintain such agent at all times unless it shall designate and
notify the other of a reasonably satisfactory successor agent or agents.
19.3 Negotiation of Provisions. The parties agree that the choice
-------------------------
of law and forum provisions of this Section 19 have been negotiated in good
faith and agreed upon by the parties hereto and are reasonable. The parties, by
their due execution of this Agreement, expressly agree, to the fullest extent
permitted by law, not to challenge the choice of law or forum provisions
contained in this Section 19.
20. No Third Party Beneficiaries
----------------------------
None of the provisions of this Agreement shall be for the benefit of or
enforceable by or against any person other than a party, including without
limitation, any creditor of WORLDSPAN or of MICROSOFT.
21. Cooperation and Further Assurances
----------------------------------
Each party hereto agrees to execute, acknowledge, deliver, file and record
such further certificates, instruments and documents, and to do such other acts
and things as may be required by law, or as may, in the reasonable opinion of
the counsel of either party, be necessary or advisable to carry out the full
intent and purposes of this Agreement. In addition, each party agrees to provide
to the other party, as soon as practicable after receipt of a request and
subject to applicable laws and regulations, such financial data or other
information as may be necessary for compliance with the requirements of any
federal, state or local law or regulations or any governmental agency or
authority applicable to a party or its affiliates; provided, however, that the
requesting person shall bear any outside reasonable accounting, legal, and
third-party costs and expenses incurred in fulfilling any such request. Each
party agrees to keep confidential and not use in any matter, other than as
contemplated in this Section 21, financial data or other information or
documents furnished pursuant to this Agreement unless ascertainable from public
or published information or trade sources, or already known to our subsequently
developed by such party independently, or received from a third party not under
an obligation to keep confidential such financial data, other information or
documents. Both parties also agree to confer on mutually beneficial projects,
such as, but not limited to, Net Fares support with possible incentives for the
Net Fares program, during the term of this Agreement.
11
22. Expenses
--------
Each party hereto shall assume and pay its own expenses incident to the
negotiation, execution and performance of this Agreement.
23. Waivers
-------
The terms of this Agreement may be waived only by a written instrument
signed by the party which would have been able to require compliance. No delay
on the part of either party in exercising any right, power or privilege
hereunder shall operate as a waiver thereof. No waiver on the part of either
party of any such right, power or privilege, shall preclude any further exercise
thereof or the exercise of any other such right, power or privilege.
24. Notices
-------
24.1 All notices, requests, demands, and other communications under
this Agreement shall be in writing and shall be deemed given: (a) when received
if delivered personally; (b) on the next business day if sent by overnight
service prepaid with instructions for next business day delivery; or (c) on the
day of transmission if telecopied or telegraphed (transmission confirmed), to
the parties at the following addresses and numbers (or to such other persons,
addresses and numbers as a party may have specified by notice given to the other
party pursuant to this provision):
If to WORLDSPAN:
WORLDSPAN, L.P.
000 Xxxxxxxx Xxxxxxx, XX., Xxxxx 0000
Xxxxxxx, Xxxxxxx 00000
Attention: Chief Executive Officer
Telecopier No.: (000) 000-0000
with a copy to:
WORLDSPAN, L.P.
000 Xxxxxxxx Xxxxxxx, XX., Xxxxx 0000
Xxxxxxx, Xxxxxxx 00000
Attention: Vice President, General Counsel and Secretary
Telecopier No.: (000) 000-0000
If to MICROSOFT:
MICROSOFT CORPORATION
Xxx XXXXXXXXX Xxx
Xxxxxxx, Xxxxxxxxxx 00000-0000
Attention: Product Unit Manager - Travel Products Group
Telecopier No.: (000) 000-0000
12
with a copy to:
MICROSOFT CORPORATION
Xxx XXXXXXXXX Xxx
Xxxxxxx, Xxxxxxxxxx 00000-0000
Attention: Legal Department
Telecopier No.: (000) 000-0000
24.2 If either party gives a notice regarding any alleged breach or
default of any term of this Agreement, then such party shall include prominently
on such notice the legend "Notice of Claim of Breach of Contract" or words to
the same effect.
25. Headings
--------
The headings of this Agreement are for reference purposes only and are to
be given no effect in the construction or interpretation of this Agreement.
26. Severability
------------
Any provision of this Agreement which is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof or affecting the validity or enforceability of such provision
in any other jurisdiction.
27. Counterparts
------------
This Agreement may be executed in counterparts, each of which shall be an
original and all of which shall together constitute one and the same instrument.
28. WARRANTY DISCLAIMER
-------------------
28.1 MICROSOFT, ON BEHALF OF ITSELF, ITS SUBSIDIARIES, AFFILIATES, AND
SUBSCRIBERS, ACKNOWLEDGES AND AGREES THAT, EXCEPT AS OTHERWISE PROVIDED HEREIN,
NEITHER WORLDSPAN, ITS PARTNERS, AFFILIATES, NOR ANY SERVICE PROVIDER OR OTHER
SUPPLIER OF DATA PROVIDED THROUGH THE WORLDSPAN SYSTEM WARRANTS THE ACCURACY,
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OF ANY SOFTWARE, DATA OR
EQUIPMENT. MICROSOFT FURTHER ACKNOWLEDGES AND AGREES THAT, EXCEPT AS OTHERWISE
PROVIDED HEREIN, WORLDSPAN, ITS PARTNERS, AND AFFILIATES DO NOT MAKE ANY
REPRESENTATIONS OR WARRANTIES CONCERNING THE PARTICIPATION OR IDENTITIES OF
TRAVEL SUPPLIERS OR VENDORS IN THE WORLDSPAN SYSTEM. EXCEPT AS OTHERWISE
PROVIDED HEREIN, NO WARRANTIES, GUARANTEES OR REPRESENTATIONS OF ANY KIND,
EXPRESSED OR IMPLIED, ARE MADE BY WORLDSPAN WITH RESPECT TO THE WORLDSPAN SYSTEM
OR ANY WORLDSPAN SOFTWARE, INCLUDING WITHOUT LIMITATION, ANY IMPLIED WARRANTY OF
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.
13
28.2 WORLDSPAN, ON BEHALF OF ITSELF, ITS SUBSIDIARIES, AFFILIATES, AND
SUBSCRIBERS, ACKNOWLEDGES AND AGREES THAT, EXCEPT AS OTHERWISE PROVIDED HEREIN,
NEITHER MICROSOFT, ITS AFFILIATES, NOR ITS AGENTS WARRANTS THE ACCURACY,
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OF ANY SOFTWARE, DATA OR
EQUIPMENT. WORLDSPAN FURTHER ACKNOWLEDGES AND AGREES THAT, EXCEPT AS OTHERWISE
PROVIDED HEREIN, MICROSOFT, ITS PARTNERS, AND AFFILIATES DO NOT MAKE ANY
REPRESENTATIONS OR WARRANTIES CONCERNING THE PARTICIPATION LEVEL OF USERS THE
MICROSOFT SYSTEM OR THE REVENUES THAT MIGHT BE GENERATED THEREBY. EXCEPT AS
OTHERWISE PROVIDED HEREIN, NO WARRANTIES, GUARANTEES OR REPRESENTATIONS OF ANY
KIND, EXPRESSED OR IMPLIED, ARE MADE BY MICROSOFT WITH RESPECT TO THE MICROSOFT
SYSTEM, ITS SUBSCRIBERS, OR ANY MICROSOFT SOFTWARE, INCLUDING WITHOUT
LIMITATION, ANY IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR
PURPOSE.
IN WITNESS WHEREOF, each of the parties hereto have caused this Agreement
to be executed by its respective officer thereunto duly authorized as of the day
and year first above written.
MICROSOFT CORPORATION WORLDSPAN, L.P.
/s/ Xxxxx Xxxxxxxxxx /s/ Xxxx Xxxxxxx
--------------------------------- --------------------------------
By (sign) By (sign)
Xxxxx Xxxxxxxxxx Xxxx Xxxxxxx
--------------------------------- --------------------------------
Senior Vice President - Consumer Chief Executive Officer, pursuant to
Division a delegation of authority by the
General partners of WORLDSPAN, L.P.
12/22/95
--------------------------------- ________________________________
Date Date
14
SCHEDULE 1
DEFINITIONS RELATING TO THE
CRS MARKETING, SERVICES AND DEVELOPMENT AGREEMENT
"ACH" means the Airlines Clearing House
"ARC" means the Airlines Reporting Corporation
"ATA" means the Airline Transport Association
"Additional Development Services" means programming services provided by
WORLDSPAN pursuant to Section 8 of the Agreement to create improvements and
enhancements to the WORLDSPAN System for the benefit of MICROSOFT.
"Computer Reservation System" or "CRS" means an automated system used by travel
agents and other non-airline personnel under contractual agreement, containing
information about the availability of travel related services and goods.
"Confidential Information" shall have the meaning set forth in the Non
Disclosure Agreement. This Agreement shall also be considered Confidential
Information of each party with respect to the other party.
"Contracts" means contracts, leases, sales orders, licenses, agreements,
permits, plans, purchase orders, commitments, collective bargaining agreements,
and other binding arrangements (including, without limitation, capital
commitments and arrangements with respect to construction in progress), whether
oral or written, express or implied.
"CRS Services" means all of the information, data, services, features and
functions of the WORLDSPAN System made available to all Travel Agent customers
of WORLDSPAN from time to time.
"Event of Default" has the meaning assigned in Section 7 of the Agreement.
"Fares/Pricing Services" means the services provided to MICROSOFT through the
WORLDSPAN System with respect to information on fares and the automatic
calculation of prices for air travel itineraries for MICROSOFT System users.
"IATA" means the International Air Transport Association.
"Intellectual Property Right" means each (a) Patent, (b) Trademark, (c) trade
name, (d) knowhow, (e) shop right, (f) copyright, (g) service xxxx, (h) trade
secret, (i) invention and (j) any Intellectual Property Right.
"Loss" means loss, liability (whether accrued, absolute, contingent, or
otherwise), damages, deficiencies, expenses (including without limitation, fees
and disbursements of counsel and expenses of investigation), claims, liens or
other obligations whatsoever.
15
"MICROSOFT Network" means the telecommunications network operated and/or managed
by MICROSOFT.
"MICROSOFT Software" means the computer programs and associated documentation,
including source code, used by MICROSOFT in the MICROSOFT Network or otherwise
developed by or licensed to MICROSOFT.
"MICROSOFT System" means the computer hardware, software and related devices and
systems used by, or operated for the benefit of, MICROSOFT to provide an Online
System to customers and MICROSOFT internal users including, without limitation,
the MICROSOFT Software and the MICROSOFT Network. The MICROSOFT System does not
include the WORLDSPAN System.
"MICROSOFT System user" means any person or entity who is entitled to use the
MICROSOFT System.
"Network Services" means data communication services provided through a network.
"Non Disclosure Agreement" means that Microsoft Corporation Non-Disclosure
Agreement between MICROSOFT and WORLDSPAN dated February 10, 1995.
"Online System" means any system or combination of systems for distributing
electronic content or an electronic product or service, digital or otherwise,
via transmission, directly or indirectly, to users, whether over telephone
lines, cable television systems, optical fiber connections, cellular telephones,
satellites, wireless broadcast, or other mode of transmission now known or
subsequently developed.
"Operational Emergency" means (i) any disruption in or impairment of the
operation of the WORLDSPAN System that causes a material interruption in the
normal business operations of any WORLDSPAN Hosted Carrier, or (ii) any problem
or defect in the WORLDSPAN System which, in the reasonable opinion of WORLDSPAN,
either (x) impairs the ability of aircraft of any such carrier to operate safely
pursuant to the laws, rules or regulations of any jurisdiction governing the
flight of such aircraft or (y) poses any imminent risk that the airline
operations conducted by any such carrier will suffer any event, occurrence or
delay that poses a material threat to the safe operation of any aircraft.
"Patents" means patents (including all reissues, divisions, continuation and
extensions thereof), patent applications, patent disclosures docketed and all
other patent rights.
"Person Month" means the equivalent of one person working on average one hundred
seventy (170) hours for a period of thirty (30) consecutive days.
"Power Shopper" means the functionality provided through the WORLDSPAN System to
permit a user to automatically retrieve the lowest priced travel option as more
fully defined in the document entitled "WORLDSPAN Super Transaction
Implementation Guide" as modified on November 13, 1995.
16
"Response Time" means the time elapsed between delivery of a message to the
WORLDSPAN System, until the response to that message leaves the WORLDSPAN System
(exclusive of the WORLDSPAN Network).
"Rollout Date" means the date that Power Shopper has been through alpha testing,
that changes and/or fixes arising out of alpha testing have been implemented by
WORLDSPAN, and Power Shopper is then released to MICROSOFT for beta testing.
"Term" shall have the meaning assigned in Section 7 of the Agreement.
"Territory" means the geographic territory defined by IATA as Traffic
Conferences 1 and 2, which includes all of the North and South American
continents and xxxxxxxx xxxxxxx, Xxxxxxxxx, Xxxxxxx, the West Indies and Islands
of the Caribbean, the Hawaiian Islands (including Midway and Palmyra), all of
Europe and adjacent islands, Iceland, the Azores, all of Africa and adjacent
islands, Ascension Island and that part of Asia lying west of and including
Iran.
"Trademark" means a trademark, service xxxx or an application for either.
"Training Materials" means books, instructions, charts, information or programs
used or useful in training or educating a Travel Agent in operating the
WORLDSPAN System, regardless of whether such materials are made available in
print, electronic media, online or otherwise.
"Travel Agent" means each wholesaler, agent or other person who makes travel
arrangements for others for airlines, trains, buses, cruise ships, hotels, car
rentals and the like as well as any corporate travel department, but shall not
include any Travel Supplier.
"Travel Supplier" means each airline, hotel, car rental company, cruise line or
other entity providing travel related goods or services.
"WORLDSPAN Hosted Carrier" means any WORLDSPAN Partner which receives its
internal reservation and/or flight operations functions from the WORLDSPAN
System.
"WORLDSPAN Network" means the telecommunications network operated and/or managed
by WORLDSPAN.
"WORLDSPAN Partner" means any airline that owns, directly or indirectly, an
equity interest in WORLDSPAN, L.P.
"WORLDSPAN Software" means the computer programs and associated documentation,
including source code, used by WORLDSPAN in connection with the operation of the
WORLDSPAN System, including all Improvements.
17
"WORLDSPAN System" means the computer hardware, software and related devices and
systems used by WORLDSPAN to provide services to MICROSOFT pursuant to the
Agreement including, without limitation, the WORLDSPAN Software and the
WORLDSPAN Network.
"WORLDSPAN Training Materials" means training manuals, books, software and other
materials used or useful in connection with training for WORLDSPAN's Travel
Agent customers.
18
SCHEDULE 2.1.2
WORLDSPAN INITIAL MINIMUM CAPACITY REQUIREMENTS
WORLDSPAN will provide initial capability to process up to [*] concurrent TPF
transactions during peak hours (7am-7pm EST) and up to [*] concurrent TPF
transactions during off peak hours (7pm-7am EST) submitted from MICROSOFT. This
capacity is expected to be sufficient to process [*] Super Transactions per
second during peak hours and up to [*] super Transactions per second during off-
peak hours. This will be implemented in the form of [*] of terminal addresses
which MICROSOFT can access through the WORLDSPAN Auxiliary Processor. WORLDSPAN
will provide one half the number of terminal addresses guaranteed for the
beginning phase of production by February 15, 1996. During the period February
15, 1996 to August 14, 1996, for agreed upon scheduled periods of at least ten
(10) days every two (2) months, full initial capacity as described above will be
made available for the purpose of stress testing.
WORLDSPAN SYSTEM AVAILABILITY OBJECTIVE
The CRS Services will be available to MICROSOFT on average during any [*]
consecutive month period at least [*] of the time.
Regarding Power Shopper: given that MICROSOFT does not submit at a higher rate
than [*] Power Shopper request per [*] seconds during peak hours (7am-7pm EST)
and [*] Power Shopper per second during off peak hours (7pm-7am EST)WORLDSPAN
will provide a substantive, accurate response [*] of the time.
Prior to Rollout Date
MICROSOFT and WORLDSPAN agree to:
1. Identify all unique Super Transactions which will be generated by MICROSOFT
for processing by the WORLDSPAN System and identify the average TPF
Transaction rate per Super Transaction.
2. Identify profile of Super Transactions activity to include estimates of rates
for entire 24-hour daily periods.
3. Measure current Response Time levels provided to Travel Agent and other
customers of WORLDSPAN System using identical or similar Super Transactions.
4. Identify and implement any necessary changes to the WORLDSPAN System to make
Response Times to MICROSOFT comparable to measurements from point 3 above.
5. MICROSOFT will make changes to its message structure as suggested by
WORLDSPAN to improve Response Times providing the changes do not materially
impact the functionality provided to MICROSOFT System users.
[*] The redacted portion, indicated by this symbol, is the subject of a
confidential treatment request.
19
Prior to end of Beta Test
-------------------------
WORLDSPAN and MICROSOFT will mutually agree to the documentation and acceptance
of Response Time objectives above.
The Response Time objectives above shall be available no later than August 14,
1996. In the event the parties are unable to agree to the Response Times to be
imposed during the term of this Agreement, either party may terminate this
Agreement pursuant to Section 7.2.
SCHEDULE 2.2
WORLDSPAN DEVELOPMENT ITEMS AND DELIVERY DATES
This schedule defines additional functionality in addition to the CRS Services
that WORLDSPAN will provide to MICROSOFT pursuant to the Agreement. Also defined
is the nature and responsibility for the communication link between WORLDSPAN
and MICROSOFT and standards for WORLDSPAN System availability to MICROSOFT
during development.
General Nature of Work
MICROSOFT requires a set of changes to the WORLDSPAN System in order to build
the initial version of the product to be included with the Microsoft System.
Other changes may be necessary to support future versions. The changes described
in this subsection are general only, and more detailed descriptions follow
below. Although all requests in this Schedule 2.2 refer to Super Transaction,
other functionally similar structured message interfaces may be substituted
following MICROSOFT's consent. The changes fall into four categories:
1. Provide functionality through the Super Transaction API that exists on the
native host systems but is not currently available through Super Transaction.
Where practical, MICROSOFT will in its discretion attempt to leverage the
existing capability of the host systems and not require new functionality at the
host level. However, new host system capability may be needed in some areas.
2. Provide enhanced shopping capabilities.
3. Provide support for automating processes that an experienced travel agent
could perform using the existing WORLDSPAN System. For example, interpreting
fares rules and applying applicable discounts.
4. Support MICROSOFT's ability to provide travel agency operations (ticketing,
queue management, etc.) and telephone support, either directly or through
agreement with third parties.
Existing Functionality
MICROSOFT will have the ability to use all functionality described in "WORLDSPAN
Super Transaction Specifications" dated December 1, 1995. All functionality
described in the Specifications will work as documented. Any functionality
described in the Specifications but not yet implemented will be accessible by
MICROSOFT by December 15, 1995.
All transactions will return complete, accurate and reliable information. [*] of
all software defects reported by MICROSOFT will be resolved in 30 days or less
unless by mutual agreement the time limit is extended. Resolution will either
mean the defect is fixed or a suitable work around is identified. A "software
defect" means any documented occurrence of an instance where the software does
not perform according to its published specifications.
Summary of the Requirements for New Work
The following enhancements will be required:
[*]
[*] The redacted portion, indicated by this symbol is the subject of a
confidential treatment request.
21
Air Transactions
----------------
[*]
Hotels
------
[*]
Other
-----
[*]
[*] The redacted portion, indicated by this symbol is the subject of a
confidential treatment request.
22
Communication Links
-------------------
WORLDSPAN will provide the following communication links with MICROSOFT:
The existing dial-in X.25 link to Atlanta provided for test purposes shall
continue through the Term of the Agreement. MICROSOFT pays for the phone costs
and WORLDSPAN maintains the internal connections and hardware to WORLDSPAN's
systems.
By November 30, 1995, WORLDSPAN will provide a leased line X.25 connection to
the point-of-presence at the local telephone provider in Bellevue Washington.
This will operate at speeds no less than 56KB/sec. WORLDSPAN will pay for all
traffic generated and the cost of installation to the point-of-presence. This
line will be used for continued test and development of the products. This will
be maintained for the Term of the Agreement.
By January 1, 1996, WORLDSPAN will provide one leased line X.25 connection to a
point of presence identified above to WORLDSPAN production facilities. This will
operate at speeds no less than 56KB/sec. WORLDSPAN will pay for all traffic
generated and the cost of installation to the point-of-presence. This line will
be used for final beta testing. This will be maintained for the Term of the
Agreement.
By February 15, 1995, WORLDSPAN will provide two more leased lines X.25
connection to a point of presence identified above to WORLDSPAN production
facilities. These will operate at speeds no less than 56KB/sec. WORLDSPAN will
pay for all traffic generated and the cost of installation to the point-of-
presence. This line will be used for production uses. This will be maintained
for the Term of the Agreement.
For each communications facility described above, WORLDSPAN will provide the
same level availability as provided to its highest volume travel agencies using
similar facilities.
The technology used to support any of the above links can be modified to provide
higher bandwidth, lower cost or better security so long as such modifications do
not materially adversely affect WORLDSPAN's performance standards hereunder.
23
AMENDMENT NO. 1
TO CRS MARKETING, SERVICES AND DEVELOPMENT AGREEMENT
THIS AMENDMENT NO. 1 TO CRS MARKETING, SERVICES AND DEVELOPMENT AGREEMENT, dated
and effective as of January 1, 1997 ("Amendment"), by and between Microsoft
Corporation, a Washington corporation ("MICROSOFT") with its principal office at
Xxx Xxxxxxxxx Xxx, Xxxxxxx, Xxxxxxxxxx 00000, and WORLDSPAN, L.P., a Delaware
limited partnership ("WORLDSPAN"), with its principal office at 000 Xxxxxxxx
Xxxxxxx, XX, Xxxxxxx, Xxxxxxx 00000.
MICROSOFT and WORLDSPAN are parties to that certain CRS Marketing, Services and
Development Agreement dated December 15, 1995 (the "Agreement").
WORLDSPAN and MICROSOFT now desire to modify the Agreement.
Now, Therefore, in consideration of the above recitals, the mutual undertakings
of the parties as contained herein and other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the parties to
this Amendment hereby agree as follows:
1. Definitions
-----------
Terms in capitalized form used in this Amendment shall have the meanings
set forth in Schedules 1 and 2.1.2. Terms in capitalized form not defined in
this Amendment shall have the meanings set forth in the Agreement.
2. Travel Supplier Xxxxxxxx
------------------------
A new Section 29 is hereby added to the Agreement to provide as follows:
29. Travel Supplier Xxxxxxxx
------------------------
29.1 Notwithstanding anything in this Agreement to the contrary,
commencing with Car and Hotel Bookings as of January 1, 1997,
WORLDSPAN agrees to prepare and deliver to MICROSOFT and/or its
designated service provider reasonably approved by WORLDSPAN, a report
showing the Car and Hotel Bookings made through MICROSOFT System
during the preceding calendar month (the "Booking Report"). The
Booking Reports shall be delivered not more than ten (10) days
following the end of the month in which the Car and Hotel Bookings
occurred. Each Booking Report shall be provided in printed form and on
electronic media according to the following specifications: delimited
text file and print file, both available for download via modem by
MICROSOFT and/or its designated service provider. Each Booking Report
shall include, for each Car and Hotel Booking, the date made, name of
the traveler, and such other information normally provided by
WORLDSPAN to the Participating Car or Participating Hotel in
connection with WORLDSPAN's invoice for the Bookings. WORLDSPAN shall
use reasonable business efforts to obligate, where applicable,
Participating Cars and Participating Hotels to pay Car and Hotel Fees
to MICROSOFT instead of WORLDSPAN. MICROSOFT understands and
agrees that WORLDSPAN may directly xxxx certain Participating Cars and
Participating Hotels for Bookings made by MICROSOFT System users.
MICROSOFT shall be responsible at its expense for contracting with
Travel Suppliers with regard to payment of MICROSOFT's charges and
other matters related to Bookings from the MICROSOFT System.
29.2 With respect to Bookings made through the MICROSOFT System, the
parties acknowledge that Participating Cars and Participating Hotels
may agree to provide MICROSOFT with a negotiated rate agreed upon by
MICROSOFT and the applicable Travel Supplier ("Negotiated Car and
Hotel Rates") in lieu of the customary industry commissions. MICROSOFT
shall provide to WORLDSPAN a list indicating whether a Participating
Car or Hotel has elected to pay a Negotiated Car and Hotel Rate on a
monthly basis. Exhibit A sets forth the Participating Cars and
Participating Hotels that have agreed to pay the Negotiated Car and
Hotel Rates as of the effective date of this Amendment. WORLDSPAN
shall prepare a monthly invoice based upon the list described above
and the monthly Booking Report, and MICROSOFT shall pay WORLDSPAN [*]
per Net Booking made by MICROSOFT System users with respect to
Participating Cars and Participating Hotels that have elected to pay
the Negotiated Car and Hotel Rates. (The amount to be paid with
respect to other Travel Suppliers (i.e., cruises and tours), if any,
shall be determined by mutual written agreement of the parties.) Such
invoiced amount shall be paid by MICROSOFT within sixty (60) days of
receipt of WORLDSPAN's invoice. In the event a Participating Car or
Participating Hotel fails to pay MICROSOFT the Negotiated Car and
Hotel Rates for three (3) consecutive months, and MICROSOFT, despite
using reasonable business efforts, is unable to collect any such fees,
MICROSOFT will notify WORLDSPAN in writing of such uncollected amounts
and the parties will discuss the appropriate next steps. If such
Participating Car or Participating Hotel continues to fail to pay
MICROSOFT the Negotiated Car and Hotel Rates for an additional thirty
(30) days after the date of the notice, then MICROSOFT may elect
either (i) to continue to pay to WORLDSPAN the [*] per Net Booking
incurred despite its inability to collect or (ii) to agree to remove
the defaulting Participating Car or Participating Hotel from this
Section 29.2 and to permit WORLDSPAN to directly invoice such
defaulting Participating Car or Participating Hotel the standard
WORLDSPAN Car or Hotel Fee in which case WORLDSPAN will refund (or
otherwise offset from amounts owed by MICROSOFT to WORLDSPAN
hereunder) the amounts paid to WORLDSPAN by MICROSOFT for such
uncollected Bookings (provided, however, WORLDSPAN will not be
required to refund any amounts where MICROSOFT fails to collect due to
a marketing or other arrangement with a Participating Car or
Participating Hotel).
29.3 If WORLDSPAN elects to terminate the availability of a Travel
Supplier participating in the WORLDSPAN System, WORLDSPAN shall notify
MICROSOFT as soon as reasonably practicable and shall use commercially
reasonable efforts to make arrangements appropriate for handling the
existing Bookings of such Travel Supplier made by MICROSOFT users
through the WORLDSPAN System.
[*] The redacted portion, indicated by this symbol is the subject of a
confidential treatment request.
2
29.4 WORLDSPAN and MICROSOFT reserve the right to charge Travel
Suppliers for other services and products, and to modify their
respective fees and charges with Travel Suppliers. In the event that
WORLDSPAN changes its Car and Hotel Fee, such change shall not affect
the distribution of the fees collected by MICROSOFT from such
Participating Cars or Participating Hotels as set forth in this
Amendment above unless otherwise agreed to by the parties in writing.
29.5 MICROSOFT shall make available to WORLDSPAN upon request any of
its books, records and reports as are reasonably necessary to confirm
the reports or statement provided by MICROSOFT hereunder.
3. Payment
-------
Section 9.2 of the Agreement is hereby deleted and replaced by the
following new Section 9.2:
9.2 Each party shall pay all amounts due hereunder calculated pursuant to
the formulas and otherwise in the manner set forth in this Agreement.
Except as otherwise specified, payment shall be made within thirty (30)
days of an invoice or, where the amount owed is determined by the paying
party, within sixty (60) days of the end of the month, quarter or other
period to which the obligation applies. All payments to be made to
MICROSOFT shall be sent to the following address (or to such other address
as MICROSOFT so designates in writing to WORLDSPAN):
Microsoft North American Collections
Attn: Dept. 551 - Special Agreements
X.X. Xxx 000000
Xxxxxx, XX 00000-0000
4. System Capacity
---------------
Section 2.1.2 of the Agreement is hereby deleted and replaced by the
following new Section 2.1.2:
2.1.2 To ensure reasonable capacity is available and subject to
Section 3.1, WORLDSPAN shall make available to MICROSOFT processing
capacity from the WORLDSPAN System according to the specifications set
forth on Schedule 2.1.2 attached hereto and as otherwise provided in
this Agreement. MICROSOFT shall not have any proprietary rights in any
equipment or software acquired by WORLDSPAN to provide capacity
hereunder. Once each calendar month during the term of this Agreement,
MICROSOFT and WORLDSPAN agree to discuss the WORLDSPAN System capacity
available to MICROSOFT and MICROSOFT's projections with respect to its
total capacity requirements. Based upon such meetings and projections,
the parties shall implement in good faith any necessary changes
mutually agreed upon, including but not limited to the WORLDSPAN
System capacity and other technical issues and shall document such
changes in a revised Schedule 2.1.2. MICROSOFT and WORLDSPAN
3
shall bear the costs and expenses associated with any expansion of
capacity of the WORLDSPAN System only to the extent expressly agreed
to herein by the parties in writing.
5. Revenue Share; Capacity Fees.
----------------------------
(a) Effective as of January 1, 1997, Section 11.1 of the Agreement
is hereby deleted and replaced by the following new Section 11.1:
11.1. A. As additional consideration for the promises made by
WORLDSPAN in this Agreement including, but not limited to the promises
regarding WORLDSPAN System capacity, MICROSOFT shall pay WORLDSPAN [*]
within thirty (30) days of the signing date of this Amendment.
Additionally, MICROSOFT shall pay WORLDSPAN [*] within thirty (30)
days of the signing of this Amendment.
B. (i) The parties agree that WORLDSPAN shall pay to
MICROSOFT the base revenue share amount indicated in the attached
Appendix 1 ("Base Revenue Share") and the incentive revenue share
amount indicated in the attached Appendix 1 (`Incentive Revenue
Share") with respect to all Airline Fees generated by MICROSOFT System
users through the MICROSOFT System. Within sixty (60) days after the
end of each calendar month, WORLDSPAN shall furnish MICROSOFT with a
statement together with payment for all amounts shown thereby to be
due to MICROSOFT. The statement shall be based upon the Base Revenue
Share and the Incentive Revenue Share (together, the "Revenue Share")
for the month preceding the month then ended, and shall contain
information sufficient to discern how the Revenue Share was computed.
(ii) At the end of each calendar year, WORLDSPAN shall
reconcile the amounts billed to and paid by Participating Airlines for
Bookings made by MICROSOFT System users. In the event a Participating
Airline fails to pay and WORLDSPAN, despite using reasonable business
efforts, is unable to collect Airline Fees from such Participating
Airline, WORLDSPAN shall notify MICROSOFT in writing of such
uncollected amounts. Within thirty (30) days of receipt of WORLDSPAN's
notice, MICROSOFT will refund (or WORLDSPAN may set off from amounts
owed by WORLDSPAN to MICROSOFT hereunder) the amounts paid to
MICROSOFT by WORLDSPAN for such Bookings. MICROSOFT shall not be
required to refund any amounts where WORLDSPAN's fails to collect due
to a marketing or other arrangement with a Participating Airline.
(iii) Notwithstanding the foregoing, MICROSOFT and WORLDSPAN
agree to discuss in good faith the revenue share that would apply in
the event a significant or major airline becomes a Participating
Airline.
C. MICROSOFT agrees to pay to WORLDSPAN the Base Capacity Fee
(as defined in Schedule 2.1.2) each month during the term of this
Agreement. The Base Capacity Fee shall be the full amount due to
WORLDSPAN from
[*] The redacted portion, indicated by this symbol is the subject of a
confidential treatment request.
4
MICROSOFT with respect to the provision of Base Capacity (as defined
in Schedule 2.1.2). The Base Capacity Fee may be adjusted in
accordance with the provisions set forth in Schedule 2.1.2.
Additionally, MICROSOFT agrees to reimburse WORLDSPAN for the charges
incurred by WORLDSPAN with respect to direct communication lines and
frame relay access devices (each party is responsible for its own
installation and ongoing costs of circuits and equipment necessary to
connect such party's facilities to the local exchange carrier's
termination of the frame relay circuits) that are requested by
MICROSOFT through its Product Unit Manager for the Travel Group
("Direct Communication Fees") and to pay the direct costs related to
terminal addresses used in connection with the MICROSOFT System by
MICROSOFT's fulfillment partner ("Fulfillment Partner Fees").
WORLDSPAN shall invoice MICROSOFT for the Base Capacity Fee, the
Direct Communication Fees, and the Fulfillment Partner Fees on a
monthly basis and shall also include a written report of the PS Rate
for the applicable month and a summary of number of sessions used by
MICROSOFT in connection with the MICROSOFT System. MICROSOFT shall pay
the invoiced amount within thirty (30) days after receipt of the
invoice.
D. WORLDSPAN shall make available to MICROSOFT upon request
any of its books, records and reports as are reasonably necessary to
confirm the reports or statements provided by WORLDSPAN hereunder.
(b) Section 11.2 of the Agreement is hereby deleted and
replaced with the following new Section 11.2:
11.2 Other than payments made by MICROSOFT for Additional
Development Services and the amounts to be paid by MICROSOFT and
WORLDSPAN, if any, pursuant to new Sections 11.1 and 29, MICROSOFT and
WORLDSPAN agree that each shall bear its own expenses incurred in the
performance of this Agreement. Not later than June 1, 1999, the
parties shall begin to confer for the purpose of determining the need
for making any change to the financial aspects of this Agreement for
the period after September 30, 1999, principally the sharing of
revenues received by WORLDSPAN from Travel Suppliers for Bookings
generated by MICROSOFT System users and expenses incurred by WORLDSPAN
in excess of the anticipated expenses. If the parties are unable to
agree to an arrangement for the period after September 30, 1999, the
Agreement shall continue according to the terms in effect on September
30, 1999, subject to each party's rights in Section 7.2 of this
Agreement.
6. Confidentiality
---------------
The terms and conditions contained in this Amendment shall be
considered Confidential Information in accordance with Section 12 of the
Agreement.
7. Other Products and Services.
---------------------------
With respect to other products and services through which MICROSOFT
may desire to use WORLDSPAN System, including but not limited to, certain
private label products, the parties will discuss in good faith how such
products and services may be
5
included under the terms of this Agreement.
8. Other Agreements
----------------
(a) Use of WORLDSPAN Logo. MICROSOFT agrees that it will include the
---------------------
WORLDSPAN Wired logo on the bottom of the MICROSOFT Expedia home page.
Placement and size of the logo will be determined by MICROSOFT, however
MICROSOFT will use its best efforts to feature the WORLDSPAN logo in a
manner similar to the presentation of any other third party logo featured
on the MICROSOFT Expedia home page.
(b) Updated Hotel Data. WORLDSPAN agrees, on at least a monthly basis
------------------
until September 30, 1999, to continue to provide and license to MICROSOFT,
subject to Section 4.3 of the Agreement, updated pricing information and
data regarding hotel and other lodging services. WORLDSPAN shall not be
obligated to provide any such pricing information and data supplied by
third parties where WORLDSPAN's agreement with such third party prohibits
providing such data to MICROSOFT or for which WORLDSPAN is required to pay
a fee and the provision of such pricing information and data is subject to
the disclaimer of warranty set forth in Section 28 of the Agreement.
Additionally, pursuant to the Section 4.3 of the Agreement, MICROSOFT has
updated certain information and data regarding hotel and other lodging
services received from WORLDSPAN as of the Effective Date of this Amendment
("Updated Hotel Data"). MICROSOFT hereby grants to WORLDSPAN a perpetual,
nonexclusive, royalty-free worldwide license and right to: (i) develop,
market, sell, make, use, reproduce, modify, adapt, create derivative works
based on, translate, distribute (directly and indirectly), transmit,
display and perform publicly, license, rent, lease, and sell such Updated
Hotel Data on printed, electronic or other fixed media, and to sublicense
any or all of the foregoing rights, including the right to sublicense such
rights to third parties; and (ii) create, develop, market, distribute,
transmit, license, sub-license and sell such Updated Hotel Data. WORLDSPAN,
ON BEHALF OF ITSELF, ITS SUBSIDIARIES, AFFILIATES AND SUBSCRIBERS,
ACKNOWLEDGES AND AGREES THAT NEITHER MICROSOFT, ITS AFFILIATES, NOR ITS
AGENTS WARRANTS THE ACCURACY, MERCHANTABILITY OR FITNESS FOR A PARTICULAR
PURPOSE OF THE UPDATED HOTEL DATA. WORLDSPAN FURTHER ACKNOWLEDGES AND
AGREES THAT MICROSOFT, ITS AFFILIATES, AND AGENTS DO NOT MAKE ANY
REPRESENTATIONS OR WARRANTIES CONCERNING THE UPDATED HOTEL DATA. To the
extent that MICROSOFT, in its sole discretion, updates or modifies the
Updated Hotel Data from the Effective Date until September 30, 1999,
MICROSOFT agrees to provide such updates or modifications to the Updated
Hotel Data to WORLDSPAN without cost. MICROSOFT shall not be obligated to
provide any Updated Hotel Data supplied by third parties where MICROSOFT's
agreement with such third party prohibits providing such data to WORLDSPAN
or for which MICROSOFT is required to pay a fee.
(c) Minimum Performance Functionality. From the Effective Date of
---------------------------------
this Amendment through September 30, 1999, WORLDSPAN agrees to provide the
same or comparable significant functionality tools and features (such as a
ticketless functionality) as other computer reservation systems. So long as
WORLDSPAN complies with the foregoing, MICROSOFT agrees that it will
maintain from the Effective Date of this
[*] The redacted portion, indicated by this symbol, is the subject of a
confidential treatment request.
6
Amendment through September 30, 1999; on a calendar quarterly basis, at
least [*] CRS booking share from Expedia North America on the WORLDSPAN
System. At any time after MICROSOFT enters into an agreement with another
computer reservation system for [*], MICROSOFT shall provide WORLDSPAN with
a quarterly report that details bookings made by Expedia North American
users. In the event MICROSOFT does not maintain at least a [*] CRS booking
share from Expedia North America on the WORLDSPAN System, the amounts
otherwise payable to MICROSOFT pursuant to Section 5 of this Amendment and
Appendix 1 shall be reduced by [*].
9. Effective Date
--------------
Except as provided in this Amendment or the schedules, the provisions
of this Amendment shall be effective as of the date specified in the
preamble to this Amendment.
10. Continuation of Agreement
-------------------------
Except as provided in this Amendment, the Agreement shall continue in
full force and effect.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed
by their duly authorized undersigned representatives as of the date first above
written.
MICROSOFT CORPORATION WORLDSPAN, L.P.
By: /s/ Xxxx Xxxxxxx By: /s/ Xxxx Xxxxxxx
--------------------------- ------------------------------
Print Name: Xxxx Xxxxxxx Print Name: Xxxx Xxxxxxx
------------------- ----------------------
Title: Vice President Title: Chief Executive Officer
------------------------ ---------------------------
Date : 6-16-97
[*] The redacted portion, indicated by this symbol is the subject of a
confidential treatment request.
7
SCHEDULE I
DEFINITIONS RELATING TO THE AMENDMENT TO THE
CRS MARKETING, SERVICES AND DEVELOPMENT AGREEMENT
"Airline Fee" means the fee charged by WORLDSPAN to a Participating Airline for
Bookings and other transactions made through the WORLDSPAN System by MICROSOFT
System users.
"Base Capacity" has the meaning set forth in Schedule 2.1.2.
"Base Capacity Fee" has the meaning set forth in Schedule 2.1.2.
"Base Revenue Share" has the meaning set forth in Section 5 of the Amendment.
"Booking" means a reservation, electronic message or other transaction made
through the WORLDSPAN System with respect to a Travel Supplier for which
WORLDSPAN charges a fee.
"Booking Report" has the meaning set forth in Section 2 of the Amendment.
"Car and Hotel Booking" means a reservation or other transaction made through
the WORLDSPAN System with respect to a Participating Car or Participating Hotel
for which WORLDSPAN charges a fee.
"Car and Hotel Fee" means the fee charged by WORLDSPAN to Participating Cars and
Participating Hotels for Bookings and other transactions made through the
WORLDSPAN System by MICROSOFT users.
"Direct Communication Fees" has the meaning set forth in Section 5 of the
Amendment.
"Fulfillment Partner Fees" has the meaning set forth in Section 5 of the
Amendment.
"Incentive Revenue Share" has the meaning set forth in Section 5 of the
Amendment.
"Negotiated Car and Hotel Rates" has the meaning set forth in Section 2 of the
Amendment.
"Net Booking" means the total number of Bookings generated for a Travel Supplier
by a MICROSOFT System user during a calendar month, minus the cancellations
accepted by WORLDSPAN for such Travel Supplier.
"Off-Peak Time" has the meaning set forth in Schedule 2.1.2.
"Off-Peak Power Shopper Factor" or "Off-Peak PS Factor" has the meaning set
forth in Schedule 2.1.2.
"Participating Airline" means an airline that is a party to an agreement with
WORLDSPAN for participation in the WORLDSPAN System and which pays WORLDSPAN
Airline Fees.
"Participating Car" means a single company or facility that rents or leases cars
or other vehicles, a chain of such companies, or an entity representing a group
of car or other vehicle rental facilities that is a party to an agreement with
WORLDSPAN for participation in the WORLDSPAN System and which pays WORLDSPAN a
fee.
"Participating Hotel" means a single hotel or other lodging facility, chain of
hotels or lodging facility, or entity representing a group of hotels or lodging
facilities, that is a party to an agreement with WORLDSPAN for participation in
the WORLDSPAN System and which pays WORLDSPAN a fee.
"Peak Time" has the meaning set forth in Schedule 2.1.2
"Peak Power Shopper Factor" or "Peak PS Factor" has the meaning set forth in
Schedule 2.1.2.
"Power Shopper Rate" or "PS Rate" has the meaning set forth in Schedule 2.1.2.
"Revenue Share" has the meaning set forth in Section 5 of the Amendment.
"Segment" means each passenger leg created in a passenger name record booked in
the WORLDSPAN System by a MICROSOFT System user less cancellations.
"Updated Hotel Data" has the meaning set forth in Section 8 of the Amendment.
"WORLDSPAN Sessions" has the meaning set forth in Schedule 2.1.2.
SCHEDULE 2.1.2
CAPACITY REQUIREMENTS
1. Base Capacity; Base Capacity Fees.
---------------------------------
The table below sets forth the initial base capacity that WORLDSPAN will provide
to MICROSOFT as measured by a Power Shopper Rate (during both Peak and Off-Peak
Times) for each identified usage by the MICROSOFT System. MICROSOFT may change
the initial base capacity pursuant to Section 2 of this Schedule 2.1.2, and the
base capacity at any time during the term is defined herein as "Base Capacity".
In consideration for the Base Capacity, MICROSOFT will pay the total Base
Capacity Fees indicated in the table below on a monthly basis in accordance with
Section 5(a) of the Amendment. MICROSOFT will receive a [*] discount from the
Base Capacity Fee in any month if (and subject to Section 3.1 of the Agreement)
i) WORLDSPAN provides a substantive, accurate response to MICROSOFT's processor
[*] of the time during the month, or (ii) WORLDSPAN fails to provide the Base
Capacity in any period during the month.
(excluding any downtime)
If MICROSOFT decides to change the level of Base Capacity (in accordance with
the procedure outlined in Section 2 below), the Base Capacity Fees will be
increased or decreased, as applicable, by [*] per WORLDSPAN Session (SMI/ST/DIR)
per month as a result of the requested change in Base Capacity. The table below
indicates the additional fee that will be incurred by MICROSOFT for one
additional Power Shopper message per second that may be requested by MICROSOFT.
Any changes to Base Capacity will be billed effective as of the first day of the
month such change is implemented by WORLDSPAN.
If MICROSOFT exceeds the indicated Base Capacity by [*] or less for any given
minute during the month, then MICROSOFT will pay to WORLDSPAN the applicable
Base Capacity Fee. If MICROSOFT exceeds the indicated Base Capacity by [*] or
less but more than [*] for any given minute during the month, then MICROSOFT
will pay to WORLDSPAN the applicable Base Capacity Fee and the pro-rated portion
of the Base Capacity Fee for the amount of capacity used in excess of Base
Capacity. If MICROSOFT exceeds the indicated Base Capacity by more than [*] for
any given minute during the month, then MICROSOFT will pay to WORLDSPAN the
applicable Base Capacity Fee, the pro-rated portion of the Base Capacity Fee for
the amount of capacity used in excess of Base Capacity, and the penalty fee
indicated in the "Penalty" column of the Table.
[*] The redacted portion, indicated by this symbol is the subject of a
confidential treatment request.
Microsoft Base Capacity Table
[*]
2. Procedure for Changing Base Capacity.
------------------------------------
MICROSOFT may from time to time during the term of this Agreement request
changes to Base Capacity. Changes to Base Capacity may be requested only by the
MICROSOFT Product Unit Manager for the Travel Group to the WORLDSPAN Product
Specialist - Expedia. Requests must be made by email, fax or letter. MICROSOFT
will pay for expanded capacity only to the extent requested by MICROSOFT.
WORLDSPAN shall provide the requested changes to the Base Capacity on the
following schedule, provided however that MICROSOFT may not request a change of
more than [*] Power Shopper messages per second at any one time:
. within two (2) weeks after receiving notice for a less than [*]
increase or decrease (based upon the total Power Shopper messages per
second or sessions for the MICROSOFT System) for existing SMI/ST/DIR
sessions.
. within sixty (60) days after receiving notice for a more than [*]
increase or decrease (based upon the total Power Shopper messages per
second or sessions for the MICROSOFT System) for an existing
SMI/ST/DIR sessions.
. within sixty (60) days after receiving notice for a new SID.
Notwithstanding the above schedule, WORLDSPAN will only be required to provide a
change in Base Capacity that equals [*] per second (or more) within sixty (60)
days after receiving notice of the request. Additionally, WORLDSPAN shall not be
required to provide to MICROSOFT more than [*] Power Shopper messages per second
in connection with the uses by the MICROSOFT System as set forth in the above
Table (or subsequent versions of the Table). The parties agree to discuss in
good faith applicable capacity issues in the event MICROSOFT desires to obtain
more than [*] Power Shopper messages per second in connection with the uses of
the MICROSOFT System as set forth in the above Table (or subsequent versions of
the Table). WORLDSPAN may reject messages from the MICROSOFT System to the
extent that capacity for any given minute during the month exceeds the indicated
Base Capacity by more than [*] if it causes a denigration of the WORLDSPAN
System.
[*] The redacted portion, indicated by this symbol is the subject of a
confidential treatment request.
3. Other Requirements
------------------
In connection with providing Base Capacity, WORLDSPAN agrees to configure its
Power Shopper capacity to accept a Power Shopper message for each SMI session.
MICROSOFT will be responsible for appropriately "throttling" the Power Shopper
messages per second rate to its associated Base Capacity. Additionally,
WORLDSPAN will provide [*] two test labs on the WORLDSPAN test systems for
customer test as a cost of doing business and will not be used in billing
calculations.
Current WORLDSPAN capacity configuration may be adjusted at MICROSOFT's request
per Section 2 above (i.e. - [*] sessions can be changed to [*] sessions).
[*]
4. Capacity Meetings and Reports.
-----------------------------
WORLDSPAN will provide the following information and reports to MICROSOFT on a
monthly basis prior to the capacity meetings described in Section 4 of the
Amendment:
[*]
5. Changes to Schedule 2.1.2. The parties may revise and amend this Schedule
-------------------------
2.1.2 from time to time during the term of the Agreement. Any amended Schedule
2.1.2 must be signed by both parties and attached to the Agreement.
[*] The redacted portion, indicated by this symbol is the subject of a
confidential treatment request.
6. Definitions.
-----------
Subject to Section 1 of the Amendment, the following are the defined terms for
the purposes of this Schedule 2.1.2:
"Base Capacity" means the PS Rate supported by WORLDSPAN for the MICROSOFT
System.
"Base Capacity Fees" means the fees set forth in the Microsoft Base Capacity
Table in Section 1 of this Schedule 2.1.2.
"Off-Peak Time" means 19:00 Eastern Time - 7:00 Eastern Time.
"Power Shopper" or "PS" means the functionality provided through the WORLDSPAN
System to permit a user to automatically retrieve the lowest priced travel
option as more fully defined in the document entitled "WORLDSPAN Super
Transaction Implementation Guide" as modified on November 13, 1995.
"Peak Time" means 07:00 Eastern Time - 19:00 Eastern Time.
"Power Shopper Rate" or "PS Rate" means the number of PS requests received by
WORLDSPAN from the MICROSOFT System per second averaged over a fixed one minute
period.
"WORDSPAN Sessions" means the total of SMI sessions, ST sessions and DIR
sessions requested by MICROSOFT that are connected to the production WORLDSPAN
TPF system.
"Peak Power Shopper Factor" or "Peak PS Factor" = [*]
"Off-Peak Power Shopper Factor" or "Off-Peak PS Factor" = [*]
(Note - Peak and Off Peak Power Shopper Factor are determined from the current
MICROSOFT configuration of PS enabled sessions for the MICROSOFT US Expedia
product.)
[*] The redacted portion, indicated by this symbol is the subject of a
confidential treatment request.
APPENDIX I
REVENUE SHARE MATRIX
The Revenue Share payable by WORLDSPAN to MICROSOFT shall consist of a Base
Revenue Share and an Incentive Revenue Share.
The Base Revenue Share of Airline Fees shall be based on the number of Power
Shopper messages per net Segment per month. The "Base Revenue Share" column
indicates that percentage amount of Airline Fees that will be paid by WORLDSPAN
to MICROSOFT in accordance with Section 5 of the Amendment from dollar one.
Power Shopper Message Base Revenue
----- ------- ------- ------------
Per Net Segment Per Month Share
------- ------- --------- -----
35.01 And Above Renegotiate
30.01 35.00
29.01 30.00
28.01 29.00
27.01 28.00
26.01 27.00
25.01 26.00
23.01 25.00
21.01 23.00
19.01 21.00
17.01 19.00
15.01 17.00
13.01 15.00
11.01 13.00
9.01 11.00
7.01 9.00
5.01 7.00
Below 5.01
[*] The redacted portion, indicated by this symbol is the subject of a
confidential treatment request.
The Incentive Revenue Share shall be based on the number of net Segments
generated by MICROSOFT System users each month. The Incentive Revenue Share
column indicates the percentage of Airline Fees that will be paid by WORLDSPAN
to MICROSOFT on an incremental basis.
[*]
For example, and subject to the limitation in the next paragraph, if the net
Segments for a particular month total [*], WORDSPAN will pay Microsoft an
incentive Revenue Share equal to [*] for net Segments that exceed [*] but are
less than [*] plus [*] for net Segments that exceed [*] but are less than [*].
The maximum Revenue Share of Airline Fees to be paid by WORLDSPAN to
MICROSOFT on a monthly basis shall not exceed [*]
[*] The redacted portion, indicated by this symbol is the subject of a
confidential treatment request.
EXHIBIT A
List of Participating Hotels and Participating Cars Paying Negotiated Car and
Hotel Rates
Participating Hotels:
[*]
Participating Cars;
[*]
[*] The redacted portion, indicated by this symbol is the subject of a
confidential treatment request.
Amendment No. 2
to CRS Marketing, Services and Development Agreement
This Amendment No. 2 to the CRS Marketing, Services and Development Agreement
(the "Amendment") is entered into as of July 27, 1998 (the "Amendment Effective
--
Date") by and between Microsoft Corporation, a Washington corporation
("Microsoft") with its principal office at Xxx Xxxxxxxxx Xxx, Xxxxxxx,
Xxxxxxxxxx 00000, and WORLDSPAN, L.P., a Delaware limited partnership
("WORLDSPAN"), with its principal office at 000 Xxxxxxxx Xxxxxxx, XX, Xxxxxxx,
Xxxxxxx 00000.
Recitals
Microsoft and WORLDSPAN are parties to that certain CRS Marketing, Services
and Development Agreement dated December 15, 1995, as amended by the parties
pursuant to that certain Amendment No. 1 dated January 1, 1997 (collectively,
the "Agreement").
Microsoft and WORLDSPAN seek to modify the Agreement as set forth herein
to provide an additional avenue for mutual cooperation wherein WORLDSPAN will
encourage certain travel suppliers to join the Microsoft Expedia Associates
Program, and WORLDSPAN and Microsoft will share WORLDSPAN revenues created from
travel bookings deriving from customers who access Expedia (and WORLDSPAN) via
the web sites of such new Associates.
Now, therefore, in consideration of the above recitals, the mutual
undertakings of the parties as contained herein and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties to this Amendment hereby agree as follows:
Agreement
1. Definitions
Terms in capitalized form used in this Amendment shall have the meanings
set forth in Schedule I of this Amendment or in the text of this Amendment.
Terms in capitalized form not defined in Schedule I or in the text of the
Amendment shall have the meanings set forth in the Agreement.
2. Revenue Share; Capacity and SID Fees
A new Section 11.3 is hereby added to the Agreement to provide as follows:
11.3. WORLDSPAN Expedia Associates Program
------------------------------------
A. Notwithstanding anything to the contrary in this Section
11, effective as of the Amendment Effective Date, the parties agree that
all Airline Fees generated with respect to WORLDSPAN/EAP Bookings shall be
shared [*] by the parties. The revenue share matrix set forth in Appendix 1
of Amendment No. 1 shall not apply to WORLDSPAN/EAP Bookings. In addition,
the additional fees charged by WORLDSPAN as referred to in Section 30.6
herein shall be reported to Microsoft, but this revenue will not be shared.
B. Within sixty (60) days after the end of each calendar
month, WORLDSPAN shall furnish Microsoft with a statement regarding, and
full payment for, all
[*] The redacted portion, indicated by this symbol is the subject of a
confidential treatment request.
1
amounts due to Microsoft pursuant to subsection A above. WORLDSPAN shall be
responsible for tracking the source of all its Bookings to enable the
parties to determine which Bookings qualify as WORLDSPAN/EAP Bookings
subject to Section 1l.3. A above. At the end of each calendar year,
WORLDSPAN shall reconcile the amounts billed to and paid by WORLDSPAN
Expedia Associates. In the event a WORLDSPAN Expedia Associate fails to pay
and WORLDSPAN, despite using reasonable business efforts, is unable to
collect Airline Fees from such WORLDSPAN Expedia Associate, WORLDSPAN will
deduct [*] of the amount not collected from such WORLDSPAN Expedia
Associate from amounts otherwise owed by WORLDSPAN to Microsoft.
C. The parties further acknowledge and agree that, with respect
to all WORLDSPAN/EAP Bookings, there shall be no Incentive Revenue Share
payable to either party.
D. Capacity for WORLDSPAN/EAP Bookings shall be provided by
WORLDSPAN and paid by Microsoft in accordance with Schedule 2.1.2 of
Amendment No. 1.
E. In the event WORLDSPAN EAP Air Bookings exceed [*] per month
in any month during the first year following the Amendment Effective Date,
Microsoft shall arrange and pay for up to [*]. WORLDSPAN shall use such
tickets as incentives to be provided to WORLDSPAN employees (and their
guests) who market Expedia to Eligible Customers.
F. Microsoft agrees to process any and all WORLDSPAN Expedia
Associates' car and hotel bookings, reservations and other transactions via
the WORLDSPAN System, regardless of whether Microsoft uses any other CRS to
process such car and hotel bookings reservations or other transactions for
other providers.
3. WORLDSPAN Marketing of Expedia Associate Program
A new Section 30 shall be added to the Agreement to provide as follows:
30. Marketing of Expedia Associate Programs; WORLDSPAN Contacts
-----------------------------------------------------------
30.1 During the term of this Agreement, WORLDSPAN may initiate
Marketing Contacts with any Eligible Customers for purposes of encouraging
such Eligible Customers to sign the EAP Agreement. WORLDSPAN shall not
entertain any discussions with the Excluded Carriers regarding the Expedia
Associate Program without first receiving written permission from
Microsoft, even in the event such an Excluded Carrier contacts WORLDSPAN
for information regarding the EAP Program; in such case, WORLDSPAN shall
promptly refer such entities to Microsoft.
30.2 Microsoft agrees that for six (6) months starting with the
Amendment Effective Date, Microsoft shall not itself make contacts with
airlines who are Eligible Customers, nor authorize any third party other
than WORLDSPAN to make such contacts, for the purposes of having such
Eligible Customers sign EAP Agreements for U.S. and Canada points of sale.
Microsoft may decide, in its sole discretion, to extend the foregoing
period longer than six (6) months.
[*] The redacted portion, indicated by this symbol is the subject of a
confidential treatment request.
2
30.3 WORLDSPAN may disclose the terms of the EAP Agreement in
Marketing Contacts to potential WORLDSPAN Expedia Associates, and may show
such Agreement to the potential WORLDSPAN Expedia Associate and allow a
duplicate to remain in the possession of such potential Associate.
WORLDSPAN shall present interested parties with all information necessary
to contact a designated Microsoft representative to pursue signing the EAP
Agreement. If the WORLDSPAN candidate signs an EAP Agreement, then if the
candidate so agrees. Microsoft shall provide WORLDSPAN a copy of the signed
EAP Agreement, subject to nondisclosure obligations.
30.4 In the event a WORLDSPAN Marketing Contact results in the
delivery of a WORLDSPAN MTT Customer to Microsoft or the conversion of an
Expedia Associate to an MTT Customer. Microsoft shall pay WORLDSPAN [*] of
the initial, one-time license fee (first year only) Microsoft may receive
from such WORLDSPAN MTT Customer. To the extent a WORLDSPAN Marketing
Contact results in the WORLDSPAN candidate becoming a WORLDSPAN Expedia
Associate prior to becoming a WORLDSPAN MTT Customer, the compensation
provisions regarding WORLDSPAN Expedia Associates shall apply. WORLDSPAN
shall not have the right to receive a copy of signed Microsoft Travel
Technology agreements.
30.5 In no event shall either party be considered, or represent
itself, as an agent of the other. Both parties agree that WORLDSPAN is an
independent contractor providing sales services to Microsoft and that
WORLDSPAN has no authority to enter into any obligations, make any
representations or warranties or negotiate any agreements on Microsoft's
behalf. Similarly, Microsoft has no authority to enter into any
obligations, make any representations or warranties or negotiate any
agreements on WORLDSPAN's behalf.
30.6 Initially, the parties agree that WORLDSPAN may charge (or
discount or waive) WORLDSPAN fees to Eligible Customers to complete a
Marketing Contact, in addition to any other compensation owed by the
WORLDSPAN Expedia Associate to Microsoft or WORLDSPAN under the EAP
Agreement or under the WORLDSPAN Expedia Associate's billing arrangements
with WORLDSPAN. The parties shall reexamine such additional WORLDSPAN fees
within six (6) months of the Amendment Effective Date, and WORLDSPAN shall
be permitted to continue such fees after six (6) months only if the parties
so agree in writing. Notwithstanding the foregoing, WORLDSPAN retains
exclusive control over the identity of and the terms of its agreements with
Travel Suppliers.
30.7 The parties agree that the WORLDSPAN "wired" logo shall appear on
WORLDSPAN Expedia Associates' web sites in substantially the same form as
set forth in Exhibit B.
30.8 In the event that traffic generated by WORLDSPAN Expedia
Associates makes Microsoft exceed the capacity provided under Schedule
2.1.2 of Amendment 1, Microsoft may restrict the ability of users referred
by WORLDSPAN Expedia Associates to make searches and bookings on Expedia,
unless WORLDSPAN agrees in writing to provide additional capacity to
accommodate the WORLDSPAN Expedia Associates users.
4. WORLDSPAN Account.
[*] The redacted portion, indicated by this symbol is the subject of a
confidential treatment request.
3
A new Section 31 shall be added to the Agreement to provide as follows:
31. Changing the CRS of a WORLDSPAN Expedia Associate.
-------------------------------------------------
Microsoft agrees not to switch the processing of WORLDSPAN bookings,
reservations or other transactions for any WORLDSPAN Expedia Associate to
any other CRS during the initial term of the WORLDSPAN Expedia Associate's
EAP Agreement, and for twelve (12) months after such initial term.
Notwithstanding the foregoing, twenty-four (24) months after the effective
date of the EAP Agreement for any WORLDSPAN Expedia Associate, Microsoft
may switch the WORLDSPAN Expedia Associate's WORLDSPAN EAP Bookings to
another CRS.
5. Territory.
The term "Territory" as defined in Schedule 1 of the Agreement is hereby
revised to provide as follows:
"Territory" means the entire world.
The parties agree that, along with this change of the definition of "Territory,"
the second and third sentences of Section 4.3 of the Agreement are deleted, and
Microsoft may market and advertise the availability of travel services via
Expedia in the applicable countries within TC3 as it does in the rest of the
Territory.
6. Fare Guarantee
A new Section 32 shall be added to the Agreement to provide as follows:
32. Fare Guarantee.
--------------
A. Beginning August 1, 1998, WORLDSPAN guarantees that the prices
available to Expedia for any itinerary for a scheduled airline flight or
flights will be correctly calculated according to applicable fare rules. In
the event that any carrier issues to Microsoft or its authorized
representative a debit memo or other charge for any fare that is not
correct, WORLDSPAN shall promptly either pay the amount of such memo or
charge directly to the carrier, or reimburse Microsoft.
B. This guarantee by WORLDSPAN shall be subject to the following
terms:
1. The price must be based upon published fares in the WORLDSPAN
System.
2. The guarantee applies only to reservations made on the scheduled
flights of WORLDSPAN Participating Carriers and through one of the
predetermined SIDs, for Microsoft Expedia in Great Britain, Germany, France and
Australia. Other countries may be added upon the mutual written consent of both
parties.
3. The price must be autopriced by Power Shopper or other standard
WORLDSPAN System facility such as, but not limited to, entries 4P or 4PLFB. The
guarantee does not apply to
4
other pricing methods such as agent assist price or rate desk price,
unless the fare has been approved before booking by a WORLDSPAN
representative.
C. Any fare quoted by the WORLDSPAN System will remain valid
for ticketing until midnight the day following the day the
reservation is made. For purposes of determining when a reservation
is made, the time zone of the SID for a particular country shall
apply rather than the time zone for the Point of Sale. WORLDSPAN
will establish SID location per Microsoft direction.
D. If Microsoft receives a debit memo or otherwise is advised
that a price subject to this guarantee is not correct, Microsoft
shall promptly forward such memo or item to WORLDSPAN. WORLDSPAN
shall promptly investigate and, where the price is guaranteed
according to this Agreement, pay the airline the amount of the
charge or, reimburse Microsoft. WORLDSPAN will use commercially
reasonable efforts to provide Microsoft a written report by the
fifteenth day of each calendar month with respect to the handling of
charges referred by Microsoft during the previous month.
E. WORLDSPAN may terminate this Section 32 in its sole
discretion without penalty or reimbursement with ninety (90) days
written notice to Microsoft.
All other terms not expressly amended herein shall remain in full force and
effect as set forth in the Agreement.
MICROSOFT CORPORATION WORLDSPAN, L.P.
/s/ Xxxxx Xxxxxxxxx /s/ Xxxx Xxxxxxx
-------------------------------- -------------------------------
By By
Xxxxx Xxxxxxxxx XXXX XXXXXXX
-------------------------------- -------------------------------
Name (Print) Name (Print)
Group Manager VICE PRESIDENT
-------------------------------- -------------------------------
Title Title
7/30/98 7/27/98
-------------------------------- -------------------------------
Date Date
5
Schedule 1
Definitions
"Co-Branded Pages" means the Web pages to be developed and maintained within
Expedia by MS pursuant to the terms of the EAP Agreement and incorporating the
branding of both MS and the WORLDSPAN Expedia Associate.
"EAP" means the Microsoft Expedia Associate Program, the terms and conditions of
which are set forth in the EAP Agreement.
"EAP Agreement" means an agreement executed between Microsoft and a Eligible
Customer that is substantially in the form attached hereto as Exhibit A.
"Eligible Customers" means any airline (not on the Excluded Carrier list--
Schedule 2) offering U.S. or Canadian Point of Sale, which are customers of
WORLDSPAN at WORLDSPAN's "direct access," "direct sell," or "airline source"
level (referring to the level of access into their reservation database for
purposes of online booking via WORLDSPAN). Microsoft may add additional
categories of companies to the definition of Eligible Customers by providing
written notice to WORLDSPAN.
"Excluded Carriers" means those airline carriers listed in Schedule 2 hereto.
"Expedia" means the software code, informational databases, products, and other
components that make up Microsoft's service to enable such end users to shop
for, reserve, book (including, at a minimum, air travel, hotel accommodations,
and car rentals) and pay for certain travel services via a personal computer (or
other interactive device) connected to the Internet or other network. Microsoft
currently offers such service on the Web under the name "Expedia," but such name
may change from time to time and the term "Expedia" as used herein shall be
deemed to refer to all future versions of the above-described online service,
regardless of the name under which it is offered from time to time, and
includes without limitation any and all additional, follow-on, successor or
replacement versions of such service.
"Marketing Contact" means any sales call or other contact initiated by
WORLDSPAN with a Eligible Customer in which WORLDSPAN explains and markets
Microsoft's EAP program or MTT program, and persuades such potential EAP
Associate or MTT Customer to contact a designated Microsoft liaison with the
intention of entering into the EAP Agreement or MTT license agreement.
"Microsoft Travel Technology" means the computer software and other technology
that provides the travel booking functionality for Expedia.
"Point of Sale" means the location of an Expedia user making a Booking on
Expedia, determined by the billing address of the credit card the end user uses
to make the booking.
"SID" shall mean a WORLDSPAN Subscriber Identification code that allows
Microsoft and WORLDSPAN to identify end user traffic on Expedia as originating
with a WORLDSPAN Expedia Associate.
"Web Link Page(s)" means any page(s) within the web site of a WORLDSPAN Expedia
Associate that provides a hyperlink directly to a Co-Branded Page in Expedia.
6
"WORLDSPAN/EAP Air Booking" means a WORLDSPAN/EAP Booking for air travel
tickets.
"WORLDSPAN/EAP Booking" means any reservation, electronic message or other
transaction made through the WORLDSPAN System (a) for which WORLDSPAN charges a
fee and (b) that is completed by a user of Expedia who has linked directly to
Expedia from Web Link Page of a WORLDSPAN Expedia Associate.
"WORLDSPAN Expedia Associate" means any Eligible Customer that actually enters
into an EAP Agreement with Microsoft as a direct result of a Marketing Contact.
"WORLDSPAN MTT Customer" means an Eligible Customer who, as a direct result of
a Marketing Contact, enters into a license agreement with Microsoft for
Microsoft Travel Technology in order to allow customers to reserve and purchase
travel services via such Eligible Customer's Web site.
7
Schedule 2
Excluded Carriers
[*]
[*] The redacted portion, indicated by this symbol is the subject of a
confidential treatment request.
8
Exhibit A
Sample EAP Agreement
MICROSOFT CORPORATION
ASSOCIATE PROGRAM AGREEMENT
THIS AGREEMENT ("Agreement") contains the complete terms and conditions
for participation in Microsoft Expedia Associate Program ("Program"), and is
made and entered into as of the later of the two signature dates below (the
"Effective Date") by and between MICROSOFT CORPORATION ("MS"), a Washington,
U.S.A. corporation, and("Company"), a ____________ corporation.
1. DEFINITIONS
1.1 "Co-Branded Pages" means (a) the Welcome Page, and(b) the Expedia
Travel Agent web pages co-branded with the COMPANY logo in accordance with the
specifications set forth in Exhibit 1. Such Expedia Travel Agent web pages will
be made available to users of COMPANY's Web Site who link directly to Expedia
from the COMPANY Web Link Pages.
1.4 "COMPANY Web Link Pages" means the pages within COMPANY Web Site
as identified in Exhibit 2 that provide a hyperlink directly to a Co-Branded
Page in Expedia.
1.5 "COMPANY Web Site" means COMPANY's site located at [insert URL of
COMPANY'S site] and any successor web site.
1.6 "Expedia" means the software code, informational databases,
products, and other components that make up MS' service which is marketed for
use by individual end users in the United States and/or Canada to enable such
end users to shop for, reserve, book (including, at a minimum, air travel, hotel
accommodations, and car rentals) and pay for certain travel services via a
personal computer (or other interactive device) connected to the Internet or
other network. MS currently offers such service on the Web under the name
"Expedia," but such name may change from time to time and the term "Expedia" as
used herein shall be deemed to refer to all future versions of the above-
described online service, regardless of the name under which it is offered from
time to time, and includes without limitation any and all additional, follow-on,
successor or replacement versions of such service.
1.7 "Expedia Logo" means the MS' Expedia logo as set forth in
Exhibit 2.
1.8 "Expedia Travel Agent" means the area within Expedia where Users
may search for and book airline tickets, automobile rentals, and hotel rooms.
1.9 "User" means any person accessing the COMPANY Web Site, Expedia,
or the Co-Branded Pages.
9
1.10 "Welcome Page" means the first Co-branded Page (as more
particularly described in Exhibit 1) that a User sees when the User links to
Expedia from Company Web Link Pages.
2. MS OBLIGATIONS
2.1 MS shall create and maintain the Co-Branded Pages of Expedia as set
forth in Exhibit 1 for use by Users linking directly to Expedia from COMPANY Web
Link Pages. MS may use COMPANY's logo and/or logo link described in Exhibit 1 in
accordance with any COMPANY logo guidelines that may be set forth in Exhibit 1
or any other replacement guidelines that COMPANY may provide to MS in writing
from time-to-time during the term of this Agreement. COMPANY's logo link on the
Co-Branded Pages shall link directly back to COMPANY Web Link Pages.
2.2 MS shall provide COMPANY with a Uniform Resource Locator (URL) to
link from COMPANY Web Link Pages to the Welcome Co-Branded Page or similar page
specified in Exhibit 1.
2.3 MS shall provide services to users linking directly to Expedia from
COMPANY Web Link Pages in accordance with MS' then-current standard terms and
conditions and standard customer service policies and procedures applying
generally to users of Expedia.
2.4 MS shall provide COMPANY, reports that set forth the activity by
users linking directly to Expedia from COMPANY Web Link Pages during the
applicable month.
2.5 MS shall be responsible for the development, operation, and
maintenance of Expedia and the Co-Branded Pages and, except as expressly set
forth herein, MS will remit Fare and Tax revenue through normal agency channels.
MS shall retain all other revenues (including all advertising revenues) that are
generated from Expedia, the Co-Branded Pages or related services.
2.6 In the event traffic on Expedia exceeds or threatens to exceed MS'
back end booking capacity, MS shall retain the right to redirect or temporarily
block User searches.
3. COMPANY OBLIGATIONS
3.1 No later than thirty(30) days after the Effective Date, COMPANY
shall prominently display and maintain a persistent hyperlink (in the form
indicated in Exhibit 2 or a substitute that MS may provide to COMPANY from
time-to-time during the term of this Agreement) on the COMPANY Web Link Pages
which shall link directly to the Welcome Page (or other Co-Branded Page) on
Expedia. If Exhibit 2 indicates that such persistent hyperlink shall be in the
form of an MS logo, then the COMPANY agrees to comply with the MS logo link
guidelines as set forth in Exhibit 3or any other replacement guidelines that MS
may provide to COMPANY in writing from time-to-time during the term of this
Agreement.
3.2 COMPANY shall provide MS with all the information identified in the
checklist set forth in Exhibit 1 at least seven (7) days prior to the Effective
Date.
3.3 During the term of the Agreement, COMPANY shall use commercially
reasonable efforts to actively market and promote Expedia and the services
available on Expedia in order to generate the maximum number of bookings on
Expedia by users of COMPANY Web Site. During the term of this Agreement, COMPANY
agrees that it will not with respect to the COMPANY Web Site, co-brand, grant a
sponsorship to or promote any third-party online travel service provider other
than Expedia.
10
3.4 COMPANY shall be responsible for the development, operation, and
maintenance of COMPANY Web Site and for all materials that appear on COMPANY Web
Site, including without limitation, as follows:
(a) all technical operation of COMPANY Web Site and all related
equipment;
(b) all maintenance of the hyperlink(s) to Expedia as described in
Exhibit 1 ; and
(c) compliance with all MS trademark requirements or guidelines as
defined in Exhibit 3 and Section 4 below.
3.5 COMPANY agrees that it shall submit the COMPANY Web Link Pages as
described in Exhibit 2 (and any modifications thereof) to MS for its review and
written approval prior to publishing such COMPANY Web Link Pages. Company shall
submit such materials to the MS Expedia Associate Program Product Manager for
review. In no event shall COMPANY or its agents make or extend any
representation or warranty on behalf of MS with respect to Expedia or the
services available therein.
4. MS TRADEMARKS IN PROMOTION MATERIALS
COMPANY agrees that if it desires to use MS trademarks, logos or branding in any
COMPANY promotional material then COMPANY shall first submit all marketing
pieces, documentation, and other materials which contain an MS trademark, logo
or branding to MS for its prior review and written approval. Company shall
submit such materials to the MS Expedia Associate Program Product Manager for
review.
5. OWNERSHIP OF EXPEDIA
5.1 MS shall own all intellectual property rights (including without
limitation all copyrights, patents, trademarks and trade secrets) in connection
with and in all versions of Expedia.
5.2 End users who use Expedia, including users who have linked to
Expedia from COMPANY Web Link Pages, shall be deemed to be customers of
Microsoft Expedia for all purposes with respect to such users' actions on
Expedia. Accordingly, all Expedia terms and conditions, rules, policies and
operating procedures including but not limited to policies relating to the use
of customer personally identifying information, customer orders, customer
service, and ticket fulfillment will apply to those customers. MS reserves the
right to change such terms and conditions, rules, policies and operating
procedures at any time.
6. PAYMENTS
6.1 Fees.
----
Microsoft Expedia is an accredited IATA approved agency. COMPANY agrees
to pay Microsoft Expedia normal commissions that it pays to standard
agencies.
7. TERM AND TERMINATION
7.1 The term of this Agreement shall commence on the Effective Date
and, unless terminated earlier as provided herein, shall continue for one (1)
year after the Effective Date.
11
7.2 In the event that MS exits the online travel service business and
no longer offers Expedia, MS may terminate this Agreement with written notice to
COMPANY. Additionally, in the event either party materially fails to perform or
comply with this Agreement or any provision thereof, and fails to remedy the
default within seven (7) days after the receipt of notice to that effect, then
the other party shall have the right, at its sole option and upon written notice
to the defaulting party, to terminate this Agreement upon written notice. Any
notice of default hereunder shall be prominently labeled "NOTICE OF DEFAULT,"
and if to MS, shall be copied to MS' Law & Corporate Affairs Department, attn.
U.S. Legal Group. The rights and remedies provided in this section shall not be
exclusive and are in addition to any other rights and remedies provided by law
or this Agreement.
7.3 Upon termination or expiration of this Agreement for any reason,
COMPANY shall immediately remove any MS logo link from COMPANY Web Site Pages.
7.4 The following provisions shall survive termination of this
Agreement: 7.3, 7.4 and 8-12.
8. REPRESENTATIONS AND WARRANTIES
Each party hereby represents and warrants as follows:
8.1 Corporate Power. Such party is duly organized and validly
---------------
existing under the laws of the state of its incorporation and has full corporate
power and authority to enter into this Agreement and to carry out the provisions
hereof.
8.2 Due Authorization. Such party is duly authorized to execute and
-----------------
deliver this Agreement and to perform its obligations hereunder.
8.3 Binding Agreement. This Agreement is a legal and valid obligation
-----------------
binding upon it and enforceable with its terms. The execution, delivery and
performance of this Agreement by such party does not conflict with any
agreement, instrument or understanding, oral or written, to which it is a party
or by which it may be bound, nor violate any law or regulation of any court,
governmental body or administrative or other agency having jurisdiction over it.
8.4 Logos and Marks. Such party has the full and exclusive right to
---------------
grant or otherwise permit the other party to use the trademarks, logos and trade
names as set forth in this Agreement, and that it is aware of no claims by any
third parties adverse to any of such trademarks, logos and trade names.
The representations and warranties and covenants in this Section 8 are
continuous in nature and shall be deemed to have been given by each party at
execution of this Agreement and at each stage of performance hereunder. These
representations, warranties and covenants shall survive termination or
expiration of this Agreement.
9. LIMITATION OF WARRANTY
EXCEPT AS EXPRESSLY WARRANTED IN SECTION 8 ABOVE, EACH PARTY EXPRESSLY DISCLAIMS
ANY FURTHER WARRANTIES, EITHER EXPRESS OR IMPLIED, INCLUDING BUT NOT LIMITED TO,
THE IMPLIED WARRANTIES OF MERCHANTABILITY, OR FITNESS FOR A PARTICULAR PURPOSE.
12
10. INDEMNIFICATION AND LIMITATION OF LIABILITY
10.1 Indemnification by COMPANY. COMPANY shall, at its expense and MS'
--------------------------
request, defend any third-party claim or action brought against MS, and MS'
affiliates, directors, officers, employees, licensees, agents and independent
contractors, (i) relating to COMPANY Web Site or the marketing thereof, and (ii)
to the extent it is based upon a claim that, if true, would constitute a breach
of a COMPANY warranty, representation or covenant set forth in this Agreement
(collectively, "COMPANY Claims"), and COMPANY shall indemnify and hold MS
harmless from and against any costs, damages and fees reasonably incurred by MS,
including but not limited to fees of attorneys and other professionals, that are
attributable to such COMPANY Claims. MS shall provide COMPANY reasonably prompt
notice in writing of any such COMPANY Claims and provide COMPANY with reasonable
information and assistance, at COMPANY's expense, to help Company to defend such
COMPANY Claims.
10.2 Indemnification by MS. MS shall, at its expense and COMPANY's
---------------------
request, defend any third-party claim or action brought against COMPANY, and its
affiliates, directors, officers, employees, licensees, agents and independent
contractors, (i) relating to Expedia, the Co-Branded Pages or the marketing
thereof, and (ii) to the extent it is based upon a claim that, if true, would
constitute a breach of a MS warranty, representation or covenant set forth in
this Agreement (collectively, "MS Claims"), and MS shall indemnify and hold
COMPANY harmless from and against any costs, damages and fees reasonably
incurred by COMPANY, including but not limited to fees of attorneys and other
professionals, that are attributable to such MS Claims. COMPANY shall provide MS
reasonably prompt notice in writing of any such MS Claims and provide MS with
reasonable information and assistance, at MS' expense, to help MS to defend such
MS Claims.
10.3 Limitation of Liability. BOTH PARTIES AGREE THAT NEITHER PARTY
-----------------------
WILL BE LIABLE FOR ANY SPECIAL, INDIRECT, INCIDENTAL, OR CONSEQUENTIAL DAMAGES
(INCLUDING BUT NOT LIMITED TO SUCH DAMAGES ARISING FROM BREACH OF CONTRACT OR
WARRANTY OR FROM NEGLIGENCE OR STRICT LIABILITY), OR FOR INTERRUPTED
COMMUNICATIONS, LOST BUSINESS, LOST DATA OR LOST PROFITS, ARISING OUT OF OR IN
CONNECTION WITH THIS AGREEMENT, EVEN IF SUCH PARTY HAS BEEN ADVISED OF (OR KNOWS
OR SHOULD KNOW OF) THE ONLY POSSIBILITY OF SUCH DAMAGES. UNDER NO CIRCUMSTANCES
SHALL MS BE LIABLE TO COMPANY OR ANY THIRD PARTY FOR AN AMOUNT GREATER THAN THE
AGGREGATE AMOUNTS PAID BY MS HEREUNDER.
11. CONFIDENTIALITY; MEDIA COMMUNICATIONS
11.1 If MS and COMPANY have entered into a Microsoft Non-Disclosure
Agreement, MS and COMPANY agree that the terms of such agreement shall be deemed
incorporated herein, and further, that all terms and conditions of this
Agreement shall be deemed Confidential Information as defined therein. If MS and
COMPANY have not entered into a Microsoft Non-Disclosure Agreement, then each
party expressly undertakes to retain in confidence and to require its agents and
contractors to retain in confidence all information and know-how transmitted to
such party that the disclosing party has identified as being proprietary and/or
confidential or which, by the nature of the circumstances surrounding the
disclosure, ought in good faith to be treated as proprietary and/or
confidential. Without limiting the foregoing, all terms and conditions of this
Agreement shall be considered confidential and shall not be disclosed (except to
either party's attorneys and accountants on a need-to-know basis) without the
prior written consent of the other party.
13
11.2 MS and COMPANY agree that the initial press release or
communication to the press and/or public regarding this Agreement and the
parties' relationship shall be made only after prior consultation with the other
party. Subsequent accurate press releases and other communications to the press
and/or public regarding the parties' relationship may be made by either party
subject to the confidentiality obligations set forth in Section 11.1.
12. GENERAL
12.1 Governing Law; Venue; Attorneys Fees. This Agreement shall be
------------------------------------
construed and controlled by the laws of the State of Washington, and each party
further consents to jurisdiction by the state or federal courts sitting in the
State of Washington. Process may be served on either party by U.S. Mail, postage
prepaid, certified or registered, return receipt requested, or by such other
method as is authorized by law. If either MS or COMPANY employs attorneys to
enforce any rights arising out of or relating to this Agreement, the prevailing
party shall be entitled to recover reasonable attorneys' fees and costs,
including expert witness fees.
12.2 Force Majeure. If the performance of this Agreement or any
-------------
obligation hereunder is prevented, restricted or interfered with by any act or
condition whatsoever beyond the reasonable control of the affected party, the
party so affected, upon giving prompt notice to the other party, shall be
excused from such performance, except for the making of payments hereunder, to
the extent of such prevention, restriction or interference.
12.3 Notices; Requests. All notices and requests in connection with
-----------------
this Agreement shall be deemed given as of the day they are (i) deposited in the
U.S. mails, postage prepaid, certified or registered, return receipt requested;
or (ii) sent by overnight courier, charges prepaid, with a confirming fax; and
addressed as follows:
COMPANY:
courier address:
-----------------------
-----------------------
-----------------------
mailing address:
-----------------------
-----------------------
-----------------------
Attention:
-----------------------
Fax:
-----------------------
Phone:
-----------------------
with a cc to: Corporate Legal Department
14
MS: MICROSOFT CORPORATION
Xxx Xxxxxxxxx Xxx
Xxxxxxx, XX 00000-0000
Attention: Product Manager, Expedia Travel
with a cc to: MICROSOFT CORPORATION
Xxx Xxxxxxxxx Xxx
Xxxxxxx, XX 00000-0000
Attention: Law & Corporate Affairs Department
Fax: U.S. Legal Group
(000) 000-0000
or to such other address as the party to receive the notice or request so
designates by written notice to the other.
12.4 Assignment. COMPANY may not assign this Agreement, or any portion
----------
thereof, to any third party unless MS expressly consents to such assignment in
writing. For the purposes of this Agreement, a merger, consolidation, or other
corporate reorganization, or a transfer or sale of a controlling interest in
COMPANY's stock, or of all or substantially all of its assets shall be deemed to
be an assignment.
12.5 Severability. In the event that any provision of this Agreement
------------
is found invalid or unenforceable pursuant to judicial decree or decision, the
remainder of this Agreement shall remain valid and enforceable according to its
terms. The parties intend that the provisions of this Agreement be enforced to
the fullest extent permitted by applicable law. Accordingly, the parties agree
that if any provisions are deemed not enforceable, they shall be deemed modified
to the extent necessary to make them enforceable.
12.6 Entire Agreement; Modification; No Offer. The parties hereto
----------------------------------------
agree that this Agreement (and the Microsoft Non-Disclosure Agreement to the
extent incorporated herein) constitutes the entire agreement between the parties
with respect to the subject matter hereof and merges all prior and
contemporaneous communications. It shall not be modified except by a written
agreement dated subsequent hereto signed on behalf of COMPANY and MS by their
duly authorized representatives. Neither this Agreement nor any written or oral
statements related hereto constitute an offer, and this Agreement shall not be
legally binding until executed by both parties hereto.
12.7 Binding Effect. Subject to the limitations herein before
--------------
expressed, this Agreement will inure to the benefit of and be binding upon the
parties, their successors, administrators, heirs, and permitted assigns.
15
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
as of the dates indicated below.
MICROSOFT CORPORATION COMPANY
----------------------------- ------------------------------------
By (sign) By (sign)
----------------------------- ------------------------------------
Name (Print) Name (Print)
----------------------------- ------------------------------------
Title Title
----------------------------- ------------------------------------
Date Date
Federal Employer ID No.:
------------
16
Exhibit 1
Co-Branded Pages Specifications
Xxxxxxx.xxx Associates Program
Partner Set-Up Information Form
Getting set up with the Expedia Associates Program is easy! The 5 simple steps
below provide you with the necessary information to help you get set up.
[ARROW] Step 1: Provide us with some basic information
[ARROW] Step 2: Send us your logo and a return link to your site
[ARROW] Step 3: Fill in the Friendship Table
[ARROW] Step 4: Linking to Xxxxxxx.xxx
[ARROW] Step 5: Send completed form and signed contract to Microsoft
[ARROW] Step 6: Microsoft sends you your Expedia Associates Program
Identification Number and URLs for linking to Expedia
[ARROW] Step 7: How to get a free Hot Mail account to receive your monthly
reports and Expedia Updates!
Please complete this document filling in blanks and checking appropriate boxes
where indicated and return to Xxxx Xxxxxx at your earliest convenience. Once
this form has been completed and returned to Expedia, you will be sent back a
copy of this form and an email confirmation with specific URL information.
If you have any questions or comments, please do not hesitate to contact Xxxx
Xxxxxx, Marketing Coordinator at [425] 703-6625 or via email
x-xxxxxx@xxxxxxxxx.xxx for assistance.
[ARROW]
17
Step 1: Provide us with Basic Information
Please fill in the blanks below:
Your Company Name _____________________________________________
This is the name consumers will see on the Intro
page (see Step 2, for sample screen shots of this
page). Please limit this name to a maximum of 40
characters.
Example: Blue Yonder Airways
Business Contact Name & email Name:_____________________________________________
Email Address:_____________________________________________
The name & email address to receive information
and notification with regards to EAP promotions,
reports, member information, etc.
Example: xxxx@xxxxxxxxxxxxxxxxx.xxx
Monthly Report Email Address _____________________________________________
The email address to receive your monthly
performance report.
Example: xxx@xxxxxxxxxxxxxxxxx.xxx
Technical Contact Name & email Name:_____________________________________________
Email Address:_____________________________________________
The name & email address to receive information
and notification with regards to set-up and review
of EAP links and pages and any technical questions.
Example: xxxx@xxxxxxxxxxxxxxxxx.xxx
Your Company "Short Name": _____________________________________________
A shortened version (up to 8 characters) of Partner Name.
Example: bluydair
(Note: If you represent multiple
sites or multiple links, and each
site is linking to Expedia, you must
assign a unique number to each site.
For example, suppose you are Alpine
Ski Center and there are individual
store sites you represent; you would
list the following multiple short
names and numbers:
bluydair 01 -Alpine Ski Center
bluydair 02 -Alpine Sports Ski Haus
bluydair 03 -Alpine Sports Ski House
In order to track each of these,
please complete a separate EAP
Partner Set Up Information Required
form for each sub-site.)
18
Business Type Select one:
Air Car
Directory Hotel
Search Engine Travel Content
Other (please specify):
19
[ARROW] Step 2: Send us your logo and a return link your site
Please provide your logo as a Gif in an electronic file format. Total Gif
dimensions should be 180 width and 38 height. The logo must be centered on a
white background with no border within the specified area. An additional fade
element image (15w x 38h) will be added to the left of the logo (see example
below).
Coloring should be within the 216 color palette that is Netscape and Internet
Explorer Compatible. This will ensure a clean solid appearance with no dithering
pattern. (If your logo contains gradient, metallic, or gives a 3D rendered
appearance please provide a high quality jpeg file instead of a Gif.)
Example:
[GRAPHIC]
[GRAPHIC]
Please fill in the blank below:
Your Return Page URL
--------------------------------------------
The URL where you'd like users to return to
if they click on your logo (as shown in the
banner samples above). Typically this return
URL is either to your homepage or the page
on your site the visitor was last at.
Example: Error! Bookmark not defined.
[ARROW]
20
[ARROW] Step 3: Friendship Table
If applicable, select whether a consumer sees and chooses from a complete list
of companies (see Figure 3) or a singular company.
Airline Flight Wizard (select one)
Show complete list of airlines to choose from
-----
Show only one airline. Please specify:
-----
---------------------------------------------
Example:Show only one airline: Blue Yonder Airways
Car Wizard (select one)
Show complete list of car rental companies to choose from
-----
Show only one car rental company. Please specify:
-----
---------------------------------------------
Hotel Wizard (select one)
Show complete list of hotels to choose from
-----
Show only one hotel company. Please specify:
-----
---------------------------------------------
Figure 3
If you'd like to rent from a specific company, select a name
from the drop-down list below.
-----------------------------------
Company All
All
Advantage Rent A Car
Alamo Rent A Car
Avis
Budget
Dollar Rent A Car
Hertz
National Car Rental Interrent
Sears Car and Truck Rental
Thrifty Car Rental
Value Rent A Car
-----------------------------------
21
[ARROW] Step 4: Linking to Xxxxxxx.xxx
Linking to Expedia is simple! We will work with you to design a welcome page
that you can link to from your site. This page will reside on Expedia's web site
and explain how Expedia works to your customers. We recommend this method of
linking to Expedia because it:
[X] Provides your customer with an individual welcome from both
your company and Expedia (co-branding)
[X] Includes necessary information to help your customer with all
of their travel needs
[X] Clearly explains how to use Microsoft Expedia
Please review our recommended linking method below - option 1 (as well as the
additional option detailed on the next page). Once you have decided which method
of linking you prefer, please indicate which choice you prefer by selecting one
of the options (on this page and the following page).
Y/N OPTION 1 Expedia works with you to create a welcome page (Figure 1
------
illustrated below.)
--------------------------------------------------------------------------------
-----------------------------------
----------- Key
Figure 1 . Circled areas represent a link
--------------------------------------------- . Arrows point to where the
link will take the customer
-----------------------------------
--------------------------------------------------
1.) You add a link to your main site to Expedia.
(image - left).
--------------------------------------------------
-----------------------------------------------------
2.) Your customer clicks on the Microsoft Expedia
link and goes to the Welcome page on Xxxxxxx.xxx
-----------------------------------------------------
-------------------------------------------------------------------------
22
Linking to Expedia...continued
Below is option 2 for linking to Expedia. This method of linking to Expedia
requires creation of an additional page hosted on your web site explaining
Expedia and providing a link to the Travel Agent main page (and/or additional
linking options as illustrated below). If you select this option, the page you
develop should include the following:
[X] Clear direction to your customer they will be leaving your web
site and going to Expedia
[X] Thorough explanation of Expedia: what the service is and what
it provides
If you select this option, we will work with you on implementing your page and
also need to approve the final design.
Y/N OPTION 2 Your company creates your welcome page (Figure 2 illustrated
------
below.)
--------------------------------------------------------------------------------
-----------------------------------
----------- Key
Figure 2 ---------------------------------- . Circled areas represent a link
----------- . Arrows point to where the
--------------------------------------- link will take the customer
1.) You add a link to your main web -----------------------------------
site to an additional page on your
company web site (image - below)
---------------------------------------
---------------------------------------------------
2.) Create an additional site which your company
[GRAPHIC] will build and host that introduces & explains
Expedia and then directs your customers to the
---------------------------------------------------
----------------------------------------------------
The Travel Agent main page site sits behind
our registration wall. Therefore, your visitors
in this instance will go to our registration page
if they are not currently an Expedia member.
If the visitor is an existing member, they will
go directly into the area you link to.
----------------------------------------------------
--------------------------------------------------------------------------------
3.) Link to Expedia via one or more of the following urls: (this example uses
Blue Yonder Airways EAPid which is 101)
Travel Agent Main Page: xxxx://xxxxxxx.xxx.xxx/xxx/xxx.xxx?XXXXXx000-0
Flight Wizard: xxxx://xxxxxxx.xxx.xxx/xxx/xxx.xxx?Xxxxxxxxxx:%0X%0Xxxxxxxx.
xxx.xxx%2Fpub%2Fela dll%3Fcscr%3Dfexp%25illy%30new&EAPID=101-1
Car Wizard: xxxx://xxxxxxx.xxx.xxx/xxx/xxx/xxx?XXXXXxxxxx%0X%0Xxxxxxxx msn
com%2Fpub%2Feta
dll%3Fascr%3Dspec%26illy%3Dnew%26flag%3DF&aapid=101.1
Hotel Wizard: xxxx://xxxxxxx.xxx com/pub/eap aso?INTRO=http%2F%2Fexpedia
xxx.xxx%2Fpub%2Fela dll%3Fcscr%3Dhtwx%26illy%3Dnew&EAPID=101-1
--------------------------------------------------------------------------------
23
[ARROW] Step 6: Return this form and the signed contract to Microsoft
Please send this form and your signed contract to:
Attn: Xxxx Xxxxxx
Microsoft Travel Business Unit
Microsoft Corporation
Xxx Xxxxxxxxx Xxx
Xxxxxx, Xxxxxxxxxx 00000-0000
[ARROW] Step 6: Microsoft will send your Expedia Identification Number and URLs
We will provide you with an EAPid number to be used when setting up
URLs. You will receive a copy of this completed form with your unique
EAPid once the contracts are signed. In addition, we will send you
linking information for linking to Xxxxxxx.xxx (this will be filled out
below and returned to you).
(This section is to be filled in by Microsoft)
1.) Your Identification Number -EAPid1 We will send you this information with
completed form --------------------------------------
--------------
2.) URLs We will send you this information with completed form
-----------------------------------------------------
These URLs will be used for linking
to Expedia from your web site.
[ARROW] Step 7: Sign up for your free Hot Mail account to receive your monthly
reports and
---------------------------------
1 EAPid = Expedia Associates Programs Identification
24
Expedia Updates
We send out monthly reports and Xxxxxxx.xxx updates each month via your EAP
Hot Mail account. The report is in HTML format and provides you with your
company monthly activity as well as new promotions on Expedia you can
participate in and other Xxxxxxx.xxx content and event updates.
If you are running Microsoft Outlook 98 you will
be able to receive HTML based email. Check
here if you are running Outlook 98 and include
your email address:
--------------------------
[GRAPHIC]
To sign up for your Hot Mail account here is what you need to do:
1.) Go to xxxx://xxxxxxx.xxx/
2.) Register and Sign up for your account!
3.) Send Expedia your Hot Mail address we will add to our account list for
monthly reporting distribution i.e., xxxxxxxxxxxxx@xxxxxxx.xxx (or the name
-------------------------
of the person who will receive the reports)
HOTMAIL EMAIL ADDRESS - INPUT HERE BEFORE RETURNING FORM:
--------------------------------------------------------------------------------
The names of companies, products, people, characters, and/or data mentioned
herein are fictitious and are in no way intended to represent any real
individual, company, product, or event, unless otherwise noted.
25
Appendix A
Figure 1 - Option 1: Co-Branded Introduction Page
If you choose this option, your url to link to Expedia would be as follows:
xxxx://xxxxxxx.xxx.xxx/xxx/xxx.xxx?XXXXXxX-0 X in this instance is a PLACEHOLDER
for your EAPid. With your returned contract and set up form, your assigned url
will be found within Step 5 under EAPid.
26
Appendix B
Figure 2 - Option 2: Customized Introduction Page
If you choose this option, your url to link to Expedia would one or more of the
following URLS:
[GRAPHIC]
--------------------------------------------------------------------------------
3.) Link to Expedia via one or more of the following urls: (this example uses
Blue Yonder Airways EAPid which is 101)
Travel Agent Main Page: xxxx://xxxxxxx.xxx.xxx/xxx/xxx.xxx?XXXXXx000-0
Flight Wizard: xxxx://xxxxxxx.xxx.xxx/xxx/xxx.xxx?Xxxxxxxxxx:%0X%0Xxxxxxxx.
xxx.xxx%2Fpub%2Fela dll%3Fcscr%3Dfexp%25illy%30new&EAPID=101-1
Car Wizard: xxxx://xxxxxxx.xxx.xxx/xxx/xxx/xxx?XXXXXxxxxx%0X%0Xxxxxxxx msn
com%2Fpub%2Feta
dll%3Fascr%3Dspec%26illy%3Dnew%26flag%3DF&aapid=101.1
Hotel Wizard: xxxx://xxxxxxx.xxx com/pub/eap aso?INTRO=http%2F%2Fexpedia
xxx.xxx%2Fpub%2Fela dll%3Fcscr%3Dhtwx%26illy%3Dnew&EAPID=101-1
--------------------------------------------------------------------------------
X in this instance is a PLACEHOLDER for your EAPid. With your returned contract
and set up form, your assigned url will be found within Step 5 under EAPid.
[GRAPHIC]
--------------------------------------------------------------------------------
---------
tagging [GRAPHIC]
---------
----------------------------------------------------------
Expedia Page Link
Travel Agent Main Page or one of the other options: Hotel,
Car or Flight wizard.
----------------------------------------------------------
--------------------------------------------------------------------------------
Tagging occurs when the user from Blue Yonder Airways clicks through to the
Expedia web site.
--------------------------------------------------------------------------------
27
Exhibit 2
Expedia Logo
[LOGO OF MICROSOFT XXXXXXX.XXX APPEARS HERE]
Start your travel here
28
Exhibit B
Sample Appearance of WORLDSPAN Wired Logo
on WORLDSPAN Expedia Associate Web Sites
[LOGO OF WORLDSPAN WIRED APPEARS HERE]
30
Exhibit 3
Expedia Logo Link and
Guidelines for Using the Expedia Logo Link
On COMPANY Web Link Pages
The following guidelines apply to COMPANY'S use of the Expedia Logo for use on
COMPANY Web Link Pages
1. Except as Microsoft may authorize elsewhere, COMPANY may use only the
Expedia Logo in accordance with the Agreement and guidelines set forth
below.
2. COMPANY may only use the Expedia Logo on COMPANY Web Link Pages identified
in Exhibit 1, and not in any other manner. It must always be an active link
to Microsoft's Expedia web site at xxxx://xxxxxxx.xxx/. HTML code for the
link is shown below.
3. The Expedia Logo gif includes certain words describing the significance of
the Expedia Logo on COMPANY Web Site Pages (i.e. the Expedia Logo is a link
to Microsoft, not an endorsement of COMPANY Web Site). COMPANY may not
remove or alter this or any other element of the Expedia Logo.
4. The Expedia Logo may be used only on COMPANY Web Link Pages that make
accurate references to Microsoft Expedia's products or services. COMPANY
Web Link Page title and other trademarks and logos must appear at least as
prominent as the Expedia Logo. COMPANY may not display the Expedia Logo in
any manner that implies sponsorship, endorsement, or license by Microsoft.
5. The Expedia Logo must appear by itself, with a minimum spacing (the height
of the Expedia Logo) between each side of the Expedia Logo and other
graphic or textual elements on COMPANY Web Link Page. The Expedia Logo may
not be used as a feature or design element of any other logo.
6. COMPANY may not alter the Expedia Logo in any manner, including size,
proportions, colors, elements, etc., or animate, morph or otherwise distort
its perspective or two-dimensional appearance.
7. COMPANY may not use the Expedia Logo on any site that disparages Microsoft
or its products or services, infringes any Microsoft intellectual property
or other rights, or violates any state, federal or international law.
These guidelines do not grant a license or any other right in Microsoft's logos
or trademarks. Microsoft reserves the right in its sole discretion to terminate
or modify permission to use the Expedia Logo at any time. Microsoft reserves the
right to take action against any use that does not conform to these Policies,
infringes any Microsoft intellectual property or other right, or violates other
applicable law.
29
Amendment No. 3
to CRS Marketing, Services and Development Agreement
This Amendment No. 3 to the CRS Marketing, Services and Development Agreement
(the "Amendment No. 3") is entered into as of April 1, 1999 (the "Amendment
Effective Date") by and between Microsoft Corporation, a Washington corporation
("Microsoft") with its principal office at Xxx Xxxxxxxxx Xxx, Xxxxxxx,
Xxxxxxxxxx 00000, and WORLDSPAN, L.P., a Delaware limited partnership
("WORLDSPAN"), with its principal office at 000 Xxxxxxxx Xxxxxxx, XX, Xxxxxxx,
Xxxxxxx 00000.
Recitals
i. Microsoft and WORLDSPAN are parties to that certain CRS Marketing,
Services and Development Agreement dated December 15, 1995, as amended by the
parties pursuant to that certain Amendment No. 1 dated January 1, 1997 and
Amendment No. 2 dated July 1, 1998 (collectively, the "Agreement").
ii. Microsoft and WORLDSPAN seek to modify the Agreement as set forth
herein to change the revenue sharing arrangements, capacity provisions, and
other terms under the Agreement.
Now, therefore, in consideration of the above recitals, the mutual
undertakings of the parties as contained herein and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties to this Amendment hereby agree as follows:
Agreement
1. Definitions
Terms in capitalized form not defined in the text of this Amendment No. 3
shall have the meanings set forth in the Agreement.
2. Revenue Share.
(a) The revenue share matrix set forth in Appendix 1 of Amendment No. 1
shall be deleted and replaced in its entirety with the matrix attached as
Appendix 1 of this Amendment No. 3. Furthermore, Section 11.3 A. through D. of
the Agreement, as set forth in Amendment No. 2, shall be deleted, and the
revenue share described in Appendix 1 of this Amendment No. 3 shall apply to
WORLDSPAN/EAP Bookings as well as all other air bookings under the Agreement.
However, in the event (i) WORLDSPAN breaches the Development Agreement between
the parties dated as of July 1, 1999 (the "BFS Agreement") and Microsoft elects
to terminate the BFS Agreement pursuant to Section 5.2(a) of the BFS Agreement
or (ii) WORLDSPAN elects to terminate the BFS Agreement pursuant to Section
5.2(b) of the BFS Agreement, then the revenue share and WORLDSPAN's capacity
commitment will revert to the Revenue Share, volume tables and WORLDSPAN
capacity commitment set forth in Schedule 2.1.2 and Appendix 1 of Amendment No.
1 to the Agreement.
(b) Microsoft recognizes that [*] and WORLDSPAN are in the process of
negotiating an agreement whereby WORLDSPAN will provide [*] with hosting and
other airline services. As a part of these negotiations, WORLDSPAN has agreed
to charge hosting and other airline services. As a part of these negotiations,
WORLDSPAN has agreed to charge [*] at cost (as determined in accordance with
WORLDSPAN's normal cost collection and allocation methodology, as used by
WORLDSPAN with respect to its owner airlines) for messages generated through the
[*]. Microsoft agrees that these at-cost fees charged by WORLDSPAN to [*] will
not be included within the definition of Airline Fees under this Agreement and
will not be subject to the revenue share specified in Appendix 1. In the event
WORLDSPAN and [*] do not execute an agreement for hosting and other airline
services within three (3) years after the Effective Date, WORLDSPAN will charge
[*] for all transactions generated on the [*]in accordance with the
Participating Carrier Agreement between [*] and WORLDSPAN and all revenue
received from [*] from its Internet booking site as an [*] (including all
amounts paid retroactively by [*]) will be included as Airline Fees and shared
with Microsoft in accordance with Appendix 1.
[*] The redacted portion, indicated by this symbol is the subject of a
confidential treatment request.
1
[*]
(c) Section 11.2 of the Agreement is hereby deleted and replaced with
the following new Section 11.2:
Section 11.2. Other than payments made by MICROSOFT for Additional
Development Services and the amounts to be paid by MICROSOFT and
WORLDSPAN, if any, pursuant to new Sections 11.1 and 29, MICROSOFT
and WORLDSPAN agree that each shall bear its own expenses incurred in
the performance of this Agreement.
3. Capacity
Schedule 2.1.2 is deleted from the Agreement in its entirety. Section
2.1.2 of the Agreement, as set forth in Amendment No. 1, is hereby deleted
and replaced in its entirety with the following:
Section 2.1.2. WORLDSPAN and Microsoft will work together in good
faith to ensure the WORLDSPAN System has sufficient capacity to
process Microsoft's estimated demand in accordance with this Section.
The failure of either (i) WORLDSPAN to deliver sufficient capacity
to meet Microsoft's demand, or (ii) Microsoft to deliver the
anticipated air ticket sales, will result in a financial penalty
mutually agreed upon by the parties as set forth herein.
(a) Each month during the Term, Microsoft shall provide to
WORLDSPAN a good faith estimate of the projected Expedia air ticket
sales for each of the following twelve (12) months. WORLDSPAN will
estimate segments to be generated by the projected level of Expedia
air ticket sales and the number of Power Shopper messages that are
expected to be generated by the estimated segments. Microsoft shall
provide such assistance and information for WORLDSPAN's estimation of
segments and Power Shopper messages as WORLDSPAN may reasonably
request. Upon conclusion of this forecasting process, WORLDSPAN
shall make all necessary preparations to provide sufficient capacity
on the WORLDSPAN System to support the projected Expedia demand
during the next six (6) months, as projected pursuant to subsection
(b) below.
(b) If a given estimate of Expedia demand will cause
WORLDSPAN to make material equipment purchases (e.g. purchase of new
CPUs or other equipment) specifically for additional Expedia demand,
WORLDSPAN shall notify Microsoft thereof in writing, and Microsoft
shall either reconfirm or adjust its estimate of Expedia air ticket
sales within ten (10) days after such notice (such reconfirmed or
adjusted estimate, a "Microsoft Binding Estimate"). WORLDSPAN may
also adjust the related estimates of segments and Power Shopper
messages. WORLDSPAN
[*] The redacted portion, indicated by this symbol is the subject of a
confidential treatment request.
2 MICROSOFT/WORLDSPAN
CONFIDENTIAL
shall deliver the required capacity no later than ninety (90) days
after the date of a Microsoft Binding Estimate.
(i) The financial remedy to compensate WORLDSPAN for
excess capacity or Microsoft for insufficient capacity shall be
determined by the parties after the following occur:
.A forecasting model that calculates air ticket sales will
be developed by Microsoft within thirty (30) days of
Microsoft's execution of this Amendment and approved by
WORLDSPAN within thirty (30) days after receipt from Microsoft.
.A capacity planning and tracking model to forecast
capacity and calculate rejected demand will be built by
WORLDSPAN within thirty (30) days of WORLDSPAN's execution of
this Amendment and approved by Microsoft within thirty (30)
days after receipt from WORLDSPAN.
.The agreed-upon models will be used for six (6) months
from approval of the above models before instituting any
financial penalties and, during such testing, may be "tweaked"
or otherwise adjusted by mutual agreement of the parties in
order to better achieve their intended purposes. At the end of
such six (6) month period (the "Test Period"), if the models,
as so adjusted, would not have resulted in payments to either
party, then the financial payment aspects of these procedures
will become operative for the remainder of the term of this
Agreement. If, however, the models, as so adjusted, would, have
resulted in payments to either party during the Test Period,
then the financial aspects of these procedures will not become
operative and the parties will negotiate in good faith to
develop alternative models or procedures as a replacement for
those described. If the parties fail to reach an agreement
regarding such replacement models or procedures within two (2)
months after the end of the Test Period, then the financial
payment aspects of the models, as so adjusted, shall continue in
effect with a cap of [*] per month payable by either party,
until the parties mutually agree on alternative financial
arrangements.
The financial penalties will be determined based on the
parameters set forth in Section 2.1.2(b)(ii) and (iii) below.
(ii) If actual Expedia air ticket sales in a given month
are less than [*] of the Microsoft Binding Estimate, then
Microsoft will pay WORLDSPAN an amount based on WORLDSPAN's
anticipated portion of lost Airline Fees. Such Airline Fees
shall be calculated at the revenue share level for such month,
as set forth in Appendix 1 of this Amendment No. 3. If actual
ticket sales in a given month are greater than [*] of the
Microsoft Binding Estimate, then Microsoft will owe nothing
additional to WORLDSPAN.
(iii) If actual Expedia air ticket sales in a given month
are less than [*] of the Microsoft Binding Estimate due to a
failure of the WORLDSPAN System to support the forecast segments
and Power Shopper messages necessary to process the Microsoft
Binding Estimate, WORLDSPAN will pay Microsoft an amount based
on Microsoft's anticipated portion of Airline Fees for ticket
sales that do not get
[*] The redacted portion, indicated by this symbol is the subject of a
confidential treatment request.
3 MICROSOFT/WORLDSPAN
CONFIDENTIAL
processed due to such interruptions in capacity. Such Airline
Fees shall be calculated at the revenue share level for such
month, as set forth in Appendix 1 of this Amendment No. 3. If
the WORLDSPAN System processes [*] or more of the Microsoft
Binding Estimate, then WORLDSPAN will owe nothing additional to
Microsoft.
(c) On an annual basis, Microsoft will provide WORLDSPAN with a
long-term demand forecast covering at least three (3) years beyond
the current year. WORLDSPAN, within thirty (30) days after
Microsoft's delivery of such demand forecast, will provide Microsoft
a nonbinding projection of the capacity WORLDSPAN will provide in
the same three (3) year period to support the forecast Microsoft
demand. If after reviewing the demand forecast from Microsoft
pursuant to this Section 2.1.2(C), WORLDSPAN can demonstrate that it
can not meet the capacity requirements during the forecast period by
the time required without having to build a new computer data center
or without materially altering the architecture of the WORLDSPAN
System, WORLDSPAN will provide Microsoft with eleven (11) months
prior written notice (provided Microsoft has given WORLDSPAN at least
twelve (12) months written notice of such increased capacity
requirement) that it will not be able to meet the capacity demand in
the forecasted time. In such event, Microsoft will be released from
its minimum commitment in Section 8(c) of this Amendment and
WORLDSPAN shall not be obligated to provide such additional capacity
to Microsoft but will continue to provide the maximum capacity set
forth in the previously agreed-upon capacity forecast. WORLDSPAN
agrees that Microsoft has provided the projection of Expedia air
ticket sales set forth below, and WORLDSPAN expects to be able to
meet capacity requirements therefor without having to build a new
computer data center and without materially altering the architecture
of the WORLDSPAN System.
Fiscal Year Ticket Sales Projected
-------------------------------------------------------------------
July 1999-June 2000 2.5 million
-------------------------------------------------------------------
July 2000-June 2001 3.7 million
-------------------------------------------------------------------
July 2001-June 2002 4.5 million
-------------------------------------------------------------------
4. Revenue Share Payments; Capacity Fees.
Sections 11.1 B and C of the Agreement, as set forth in Amendment
No. 1, are hereby deleted and replaced in their entirety with the
following:
Section 11.1 B (i) The parties agree that WORLDSPAN shall pay to
Microsoft the revenue share amount indicated in the attached
Appendix 1 (the "Revenue Share") with respect to Airline Fees
generated by Microsoft System users through the Microsoft System.
Within thirty (30) days from the end of each calendar month,
WORLDSPAN shall furnish Microsoft with a statement together with
payment for all amounts shown thereby to be due to Microsoft. That
statement shall be based upon the Revenue Share for the month
preceding the month then ended, and shall contain information
sufficient to discern how the Revenue Share was computed.
(ii) At the end of each calendar year, WORLDSPAN shall reconcile the
amounts billed to and paid by Participating Airlines for Bookings
made by Microsoft System users. In the event a Participating Airline
fails to pay and WORLDSPAN, despite using reasonable business
efforts, is unable to collect Airline Fees from such Participating
Airline, WORLDSPAN shall notify Microsoft in writing of such
uncollected amounts. Within thirty (30) days of receipt of
WORLDSPAN's notice, Microsoft will refund (or WORLDSPAN may set off
from amounts owed
[*] The redacted portion, indicated by this symbol is the subject of a
confidential treatment request.
4 MICROSOFT/WORLDSPAN
CONFIDENTIAL
by WORLDSPAN to Microsoft hereunder) the amounts paid to Microsoft by
WORLDSPAN for such Bookings. Microsoft shall not be required to
refund any amounts where WORLDSPAN fails to collect due to a
marketing or other arrangement with a Participating Airline.
Section 11.1 C. Microsoft shall reimburse WORLDSPAN for the charges
incurred by WORLDSPAN with respect to direct communication lines and
frame relay access devices (each party is responsible for its own
installation and ongoing costs of circuits and equipment necessary to
connect such party's facilities to the local exchange carrier's
termination of the frame relay circuits) that are requested by
Microsoft through its Product Unit Manager for the Travel Group
("Direct Communication Fees") and to pay the direct costs related to
terminal addresses used in connection with the Microsoft System by
Microsoft's fulfillment partner ("Fulfillment Partner Fees").
Microsoft shall also pay for any equipment requested by Microsoft and
provided by WORLDSPAN to be used by Microsoft's fulfillment partner.
WORLDSPAN shall either offset these fees from the Revenue Share due
Microsoft or invoice Microsoft for the Direct Communication Fees and
the Fulfillment Partner Fees on a monthly basis and shall also
include a written report of the PS Rate for the applicable month.
Microsoft shall pay the invoiced amount within thirty (30) days after
receipt of the invoice. Except as provided herein and Section 2.1.2,
Microsoft shall not owe WORLDSPAN any fees for capacity under this
Agreement.
5. Assignment.
Section 17 of the Agreement is hereby deleted and replaced in its
entirety with the following:
Section 17. Neither party may assign its interest in this Agreement;
provided, however, that either party may assign this Agreement upon
thirty (30) days prior written notice to a wholly-owned subsidiary or
to an entity to which substantially all the assets of the assigning
party (or, with respect to MICROSOFT, substantially all the assets of
the Expedia online consumer travel agent business) are being
transferred if such assignee assumes and agrees to perform all the
obligations of the assignor. This Agreement shall be binding upon the
parties hereto and their successors and permitted assigns and all
persons claiming under or through them or any such successor or
permitted assign.
6. Equal Treatment.
A new Section 33 shall be added to the Agreement to provide as
follows:
33. Equal Treatment.
---------------
[*] If (i) WORLDSPAN differentiates between Expedia and offline
travel agencies for reasons other than regulatory requirements
and (ii) at the time WORLDSPAN first differentiates, any two of
Sabre, Galileo or Amadeus are not similarly differentiating
between online and offline travel agencies, then the parties
shall at that time discuss adjustment to the business
relationship between the parties in good faith. If the parties
fail to reach an agreement regarding an adjustment to the
business relationship within two (2) months after WORLDSPAN
implements such differentiation, Microsoft may terminate this
Agreement upon six (6) months' written notice. Such termination
right expires eight (8) months from the date of such
differentiation.
[*] The redacted portion, indicated by this symbol is the subject of a
confidential treatment request.
5 MICROSOFT/WORLDSPAN
CONFIDENTIAL
7. Change in Expedia Search Functionality.
A new Section 34 shall be added to the Agreement to provide as
follows:
34. Change in Expedia Search Functionality.
---------------------------------------
Microsoft shall consult with WORLDSPAN on a regular basis regarding
proposed changes to the search functionality, or changes to the
utilization of existing functionality, available to end users of
Expedia that are reasonably expected to have a materially adverse
impact on message weight in the WORLDSPAN CRS. If the proposed
change has a materially adverse impact on the financial benefits of
the parties hereunder, the parties shall discuss in good faith a
corresponding adjustment to pricing or revenue share. If the parties
are unable to reach agreement within two (2) months after Microsoft
implements such change, then WORLDSPAN may terminate this Agreement
upon a further six (6) months' written notice. Such termination
right expires eight (8) months from the date of Microsoft's
implementation of such changes.
8. Changes to Expedia CRS Usage Commitment.
Section 8(c) of Amendment No. 1 to the Agreement is hereby deleted
and replaced in its entirety with the following:
(c) Minimum Performance Functionality. During the Term of the
---------------------------------
Agreement, WORLDSPAN agrees to provide the same or comparable significant
functionality tools and features (such as a ticketless functionality) as
other computer reservation systems. So long as WORLDSPAN complies with
the foregoing, Microsoft agrees that it will maintain during the Term of
the Agreement, on a calendar quarterly basis, at least the same or
greater (but in no event [*] CRS booking share from Expedia on the
WORLDSPAN System than it maintains on any other CRS ("Minimum
Commitment"). At any time after Microsoft enters into an agreement with
another CRS for Expedia, Microsoft shall provide WORLDSPAN with a
quarterly report that details bookings made by Expedia users. In the
event Microsoft does not maintain at least the Minimum Commitment CRS
booking share from Expedia on the WORLDSPAN System, the amounts otherwise
payable to Microsoft pursuant to Appendix 1 shall be reduced by [*] For
purposes of this Section only, the term "CRS" shall mean the following
entities and their successors: Sabre, Galileo, Abacus, Amadeus, and
Infini.
[*] The redacted portion, indicated by this symbol is the subject of a
confidential treatment request.
6 MICROSOFT/WORLDSPAN
CONFIDENTIAL
All other terms not expressly amended herein shall remain in full force and
effect as set forth in the Agreement. The Agreement, as amended hereby, shall
remain in effect for the remainder of the term set forth in Section 7.
Microsoft Corporation WORLDSPAN, L.P.
/s/ Xxxxxxx Xxxxxx /s/ Xxxxxxx X. Xxxxxxxx
------------------------ ---------------------------
By By
Xxxxxxx Xxxxxx Xxxxxxx X. Xxxxxxxx
------------------------ ---------------------------
Name (Print) Name (Print)
Gen. Mgr. Travel Group Co-Chief Executive Officer
------------------------ ---------------------------
Title Title
7/20/99 July 16, 1999
------------------------ ---------------------------
Date Date
7 MICROSOFT/WORLDSPAN
CONFIDENTIAL
Appendix 1
Revenue Share Matrix
The Revenue Share payable by WORLDSPAN to Microsoft shall consist of the
Base Revenue Share set forth below. The Incentive Revenue Share appearing in
Appendix 1 of Amendment No. 1 is eliminated.
The Revenue Share of Airline Fees shall be based on the number of Power
Shopper messages per net Segment per month. The "Revenue Share" column indicates
the percentage amount of Airline Fees that will be paid by WORLDSPAN to
Microsoft in accordance with Section 5 of Amendment No. 1, from dollar one.
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Power Shopper Messages per Revenue Share to
Net Segment per Month Microsoft
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30.01 and greater *
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29.01-30.00 *
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28.01-29.00 *
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27.01-28.00 *
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26.01-27.00 *
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25.01-26.00 *
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24.01-25.00 *
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23.01-24.00 *
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22.01-23.00 *
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21.01-22.00 *
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20.01-21.00 *
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19.01-20.00 *
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18.01-19.00 *
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17.01-18.00 *
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16.01-17.00 *
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15.01-16.00 *
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14.01-15.00 *
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13.01-14.00 *
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12.01-13.00 *
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11.01-12.00 *
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11.00 and less *
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If the number of Power Shopper messages per net Segment exceeds 30.00, or
falls below 11.00, in an given month, then the parties shall renegotiate revenue
share percentages in good faith. If the parties are unable to reach agreement
within three (3) months, then at any time in the following three (3) months
either party may terminate this Agreement upon a further six (6) months' written
notice. In the meantime, the percentages set forth above shall apply.
[*] The redacted portion, indicated by this symbol is the subject of a
confidential treatment request.
8 MICROSOFT/WORLDSPAN
CONFIDENTIAL
