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EXHIBIT 10.5
SERVICES AGREEMENT
SERVICES AGREEMENT (this "Agreement"), dated as of _________
__, 1997, among Galileo International, Inc., a Delaware corporation ("Galileo"),
United Airlines, Inc., a Delaware corporation ("United"), US Airways, Inc., a
Delaware corporation ("USAW"), and Air Canada, a corporation incorporated under
the laws of Alberta ("Air Canada" and, together with United and USAW, the
"Service Providers").
WHEREAS, the Service Providers have a significant number of
sales personnel and sales offices in the ATS Territory (as hereafter defined),
and are very knowledgeable about the airline distribution business;
WHEREAS, as a result of the Service Providers' significant
number of sales personnel and sales offices in the ATS Territory and their
knowledge concerning the airline distribution business, Galileo desires to
enlist the Service Providers' assistance with certain marketing and other
services designed to assist Galileo in growing the business operations of Apollo
Travel Services ("ATS");
WHEREAS, the Service Providers desire to provide such
marketing and other services designed to assist Galileo in growing the business
operations of ATS;
NOW, THEREFORE, in consideration of the foregoing and the
mutual covenants and agreements herein contained and intending to be legally
bound hereby, the parties hereby agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. Definitions. For purposes of this Agreement, the
following terms shall have the following meanings:
"ATS Territory" means (i) the United States of America,
including its overseas territories, commonwealths, trust territories and
protectorates, (ii) Anguilla, Antigua and Barbuda, Bahamas, Barbados, Cayman
Islands, Cuba, Dominica, Dominican Republic, Grenada, Guadeloupe, Haiti,
Jamaica, Martinique, Montserrat, St. Kitts-Nevis, Saint Lucia, St. Xxxxxxx and
the Grenadines, Trinidad and Tobago and Turks and Caicos Islands, and (iii) the
Republic of Mexico.
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"Cost of Carry Factor" means the number resulting from the
following formula: (1 + Cost of Carry Rate)n, where n is the number of years
between the date hereof and the date of any applicable payment made hereunder
(adjusted pro rata for any fraction of a year).
"Cost of Carry Rate" means 8.625%.
"Segments" means net air segments, as determined by Galileo's
billing system in accordance with current practices, in respect of transactions
made in the Galileo System within the ATS Territory by (i) Neutral Travel
Providers and Other Customers that have entered into subscriber agreements with
ATS for Reservations Services (or, following the date hereof, by Neutral Travel
Providers and Other Customers within the ATS Territory that have entered into
subscriber agreements with Galileo for Reservations Services) from which Booking
Fee Revenue is generated which is split between Galileo and ATS, with respect to
NTP Revenue, in accordance with the DSSA between Galileo and ATS, or which is
split between Galileo and ATS, with respect to Other Customer Revenue, in
accordance with the first clause of Section 8.8(a) of the Galileo International
Partnership Agreement (or, following the date hereof, would have been split
between Galileo and ATS, with respect to NTP Revenue, in accordance with the
DSSA between Galileo and ATS or which would have been split between Galileo and
ATS, with respect to Other Customer Revenue, in accordance with the first Clause
of Section 8.8(a) of the Galileo International Partnership Agreement, had that
agreement and that provision, respectively, continued to have been in effect)
and (ii) Other Customers (corporate only) of United, USAW, or Air Canada
utilizing a Customized Product from which Booking Fee Revenue is generated which
is split in accordance with the first clause of Section 8.8(c) of the Galileo
International Partnership Agreement (or, following the date hereof, which would
have been split in accordance with the first Section 8.8(c) of the Galileo
International Partnership Agreement, had that provision continued to have been
in effect). The calculation of net air segments to be credited to ATS hereunder
excludes net air segments in respect of transactions made in the Galileo System
by Other Customers of United, USAW, or Air Canada utilizing Partner Developed
Products. All capitalized terms used in this definition of the term "Segments"
shall be as defined in the Galileo International Partnership Agreement or the
Distributor Sales and Service Agreement between Galileo and ATS as in effect
immediately prior to the date hereof.
"Transaction Category" means any transaction category, as
determined in accordance with Galileo's customary practices, including, without
limitation, the following transaction categories (together with any transaction
categories that replace the following transaction categories or are
substantially similar thereto): an active confirmed segment input, a passive
segment input, an other segment input, an active confirmed segment cancel, a
passive segment cancel, an other segment cancel, an interactive display
transaction, an interactive sell transaction, an inside availability
transaction, a positive acknowledgement transaction, and a marriage logic
transaction.
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"Transaction Category Weighted Average Price" means, with
respect to any applicable Transaction Category during the course of any
applicable year, the weighted average of the published prices for such
Transaction Category during the course of such year, as determined by (i)
multiplying each published list price recorded for such Transaction Category
during the course of such year by a fraction, the numerator of which is the
number of days for which such published price was in effect for such Transaction
Category during the course of such year, and the denominator of which is 365,
and (ii) taking the sum of the resulting numbers.
ARTICLE II
PROVISION OF SERVICES
SECTION 2.01. Provision of Services. Subject to the
requirements of applicable law, each of the Service Providers hereby agrees to
use its expertise with respect to the airline distribution business and its
significant number of sales personnel and sales offices in the ATS Territory to
increase Galileo's competitiveness in the marketplace and generate additional
segments and revenue for Galileo through, but not limited to, the provision of
the following services to Galileo:
(a) Representatives from the marketing divisions of each of
Galileo and such Service Provider shall meet regularly to discuss, coordinate
and implement future marketing strategies related to, but not limited to, the
direction of distribution in the marketplace and the emergence of alternative
distribution channels and technologies (i.e., the internet and other direct
access products).
(b) Representatives of such Service Provider shall assist
Galileo by conducting or participating in meetings and discussions with vendors,
including car, hotel, leisure or marketing or code share air carriers, that
participate or may participate in the Galileo system to strengthen and bolster
such relationships.
(c) Such Service Provider's sales staff shall conduct sales
calls (including joint sales calls with the appropriate Galileo account
executive) to users of the Galileo system throughout the ATS Territory, as
mutually agreed between the parties.
(d) Upon reasonable notice, such Service Provider's marketing
personnel shall participate in Galileo's vendor workshops to be held at various
times throughout the year.
(e) Certain of such Service Provider's key staff, including
sales staff, shall within the first six (6) months hereof, and annually
thereafter, attend a local one-day overview session regarding the Galileo
system.
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(f) Such Service Provider and Galileo shall cooperate in
exchanging noteworthy information for inclusion in newsletters produced for and
distributed to travel agencies.
(g) Representatives of such Service Provider shall participate
in Galileo's future global automation conferences to enhance Galileo's global
market presence.
(h) Representative of such Service Provider shall meet from
time to time with Galileo on a schedule to which they mutually agree to (i)
review the progress of such Service Provider's performance under this Agreement,
(ii) adopt a schedule of meetings and (iii) consult regarding the appropriate
staffing of Service Provider personnel to perform the Service Provider's
obligations under this Agreement.
SECTION 2.02. Designation of United Representative. United
hereby designates Xxxx Xxxxxx as its initial representative for purposes of
performing its obligations under Section 2.01.
ARTICLE III
CONTINGENT PAYMENT FOR SERVICES
SECTION 3.01. Contingent Payment for Services. (a) The
payment, if any, that Galileo shall make to the Service Providers in
consideration for the services described in Section 2.01 shall be based upon an
improvement in Galileo's air booking fee revenue, as measured over a five year
period commencing as of the date hereof, and as calculated below. The revenue
improvement shall be measured utilizing two factors, weighted average annual air
segment growth rate ("Weighted Air Segment Growth Rate") and weighted average
annual price increase rate ("Weighted Air Price Increase Rate").
(b) The Service Providers and Galileo will share in the
economic benefit to Galileo of revenue increases which are (i) above the minimum
weighted average annual air segment growth rate ("Minimum Weighted Air Segment
Growth Rate") and at or below the targeted weighted average annual air segment
growth rate ("Targeted Weighted Air Segment Growth Rate") and revenue increases
which are (ii) above the minimum weighted average annual price increase rate
("Minimum Weighted Air Price Increase Rate") and at or below the targeted
weighted average annual price increase rate ("Targeted Weighted Air Price
Increase Rate"). The Minimum Weighted Air Segment Growth Rate and the Targeted
Weighted Air Segment Growth Rate are 3.4% and 5.4%, respectively. The Minimum
Weighted Air Price Increase Rate and the Targeted Weighted Air Price Increase
Rate are 2.0% and 4.0%, respectively.
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(c) The Service Providers shall receive payments, calculated
and paid in accordance with Sections 3.02 through 3.06 below, which reflect the
approximate economic value of the achievement of the first fifty percent of the
range between (i) the Minimum Weighted Air Segment Growth Rate and the Targeted
Weighted Air Segment Growth Rate and (ii) the Minimum Weighted Air Price
Increase Rate and the Targeted Weighted Air Price Increase Rate, respectively.
Galileo shall retain the approximate economic value of the achievement of the
second fifty percent of such ranges as well as any economic value from the
achievement of a Weighted Air Segment Growth Rate or a Weighted Air Price
Increase Rate which is in excess of such ranges.
SECTION 3.02. Calculation of Segment Growth Payment. (a) The
"Segment Growth Payment" shall be calculated in accordance with the provisions
of this Section 3.02:
(i) Within 60 days of the fifth anniversary hereof (or,
in the event Section 3.04(c) is applicable, within 60
days of the date that is six months after the fifth
anniversary hereof), Galileo shall calculate in
accordance with its customary practices (A) the total
number of Segments recorded in the ATS Territory for
the period of twelve months ending on the date hereof
(the "Pre-Closing Year") and for the period of twelve
months ending on each of the first, second, third,
fourth and fifth anniversaries of the date hereof
(the "Post-Closing Years"), and (B) the percentage
increase or decrease in the total number of such
Segments for each of the Post-Closing Years in
comparison to the immediately preceding Pre-Closing
Year or Post-Closing Year, as applicable.
(ii) Following the calculations described in clause (i)
above, Galileo shall then weight such percentage
increases or decreases by multiplying such percentage
increases or decreases by the corresponding Weighting
Factors set forth on Exhibit 1 hereto. The sum of the
resulting percentages shall constitute the Weighted
Air Segment Growth Rate.
(b) If the Weighted Air Segment Growth Rate is less than or
equal to 3.4%, no Segment Growth Payment shall be made.
(c) If the Weighted Air Segment Growth Rate is greater than or
equal to 4.4%, the Segment Growth Payment shall be $100,000,000.
(d) If the Weighted Air Segment Growth Rate is greater than
3.4% but less than 4.4%, the Segment Growth Payment shall be an amount equal to
(i) $100,000,000 multiplied by (ii) a fraction, the numerator of which shall be
(A) the Weighted Air Segment Growth Rate minus (B) 3.4%, and the denominator of
which shall be 0.01.
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SECTION 3.03. Calculation of Air Booking Price Increases. (a)
Within 60 days of the fifth anniversary hereof (or, in the event Section 3.04(c)
is applicable, within 60 days of the date that is six months after the fifth
anniversary hereof), Galileo shall calculate the "Price Increase Payment" in
accordance with the provisions of this Section 3.03:
(i) Galileo shall calculate the total number of
transactions, by Transaction Category, associated
with the total number of Segments recorded in the ATS
Territory for the Pre-Closing Year.
(ii) Galileo shall then calculate the aggregate revenue in
the ATS Territory for the Pre-Closing Year by
multiplying the Transaction Category Weighted Average
Price for each Transaction Category for the Pre-
Closing Year by the total number of transactions, by
Transaction Category, recorded in the ATS Territory
in the Pre-Closing Year.
(iii) Galileo shall then determine what the total revenue
in the ATS Territory would have been in each of the
Post-Closing Years on a comparative basis to the
Pre-Closing Year by multiplying the Transaction
Category Weighted Average Price for each Transaction
Category for such Post-Closing Year by the total
number of transactions, by Transaction Category,
recorded in the ATS Territory in the Pre-Closing
Year.
(iv) Galileo shall then calculate the percentage increase
or decrease in the aggregate revenue in the ATS
Territory in each of the Post-Closing Years by taking
the results of the calculations described in clause
(iii) above for each of the Post-Closing Years and
dividing them by the results of the calculations
described in clauses (ii) and (iii) above, as
applicable, with respect to the immediately preceding
years, and then subtracting one from the resulting
numbers to derive a percentage increase or decrease.
(v) Galileo shall weight the percentage price increases
or decreases calculated in accordance with clause
(iv) by multiplying such percentage increases or
decreases by the corresponding Weighting Factors set
forth on Exhibit 1 hereto. The sum of the resulting
percentages shall constitute the Weighted Air Price
Increase Rate.
(b) If the Weighted Air Price Increase Rate is less than or
equal to 2.0%, there shall be no Price Increase Payment.
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(c) If the Weighted Air Price Increase Rate is greater than or
equal to 3.0%, the Price Increase Payment shall be $100,000,000;
(d) If the Weighted Air Price Increase Rate is greater than
2.0% but less than 3.0%, the Price Increase Payment shall be an amount equal to
(i) $100,000,000 multiplied by (ii) a fraction, the numerator of which shall be
(A) the Weighted Air Price Increase Rate minus (B) 2.0%, and the denominator of
which shall be 0.01.
SECTION 3.04. Grace Period for Certain Price Increases. (a)
The provisions of this Section 3.04 shall apply if the published price for any
Transaction Category in the ATS Territory does not increase during the course of
the first six months of the fifth Post-Closing Year.
(b) With regard to any Transaction Category whose published
price in the ATS Territory does not increase during the course of the first six
months of the fifth Post-Closing Year, but whose published price does increase
on or after the first day of the seventh month of the fifth Post-Closing Year
but prior to the first day of the first month of the sixth Post-Closing Year,
then for purposes of Section 3.03(a)(iii) and the definition of the term
Transaction Category Weighted Average Price, such price increase shall be deemed
to have occurred with regard to such Transaction Category on the first day of
the seventh month of the fifth Post-Closing Year.
(c) If the published price for any Transaction Category does
not increase in the ATS Territory during the course of the fifth Post-Closing
Year, then the calculations set forth in Sections 3.02, 3.03, 3.05 and 3.06
shall not be completed until 60 days (or, in the case of Section 3.06, 65 days)
after the date that is six months after the fifth anniversary hereof. If there
is such a price increase as to such Transaction Category in the ATS Territory
during the six month period following the fifth anniversary hereof, then for
purposes of Section 3.03(a)(iii) and the definition of the term Transaction
Category Weighted Average Price, such price increase shall be deemed to have
occurred with regard to such Transaction Category on the date that is six months
prior to the date on which such price increase actually occurred.
(d) All other calculations set forth in this Agreement with
regard to Transaction Categories whose published prices in the ATS Territory do
increase during the first six months of the fifth Post-Closing Year shall be
unaffected by the provisions of this Section 3.04.
SECTION 3.05. Calculation of Adjusted Services Payment. The
sum of (i) the Segment Growth Payment calculated in accordance with Section 3.02
and (ii) the Price Increase Payment calculated in accordance with Sections 3.03
and 3.04 shall constitute the "Total Services Payment". The Total Services
Payment shall be multiplied by the Cost of
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Carry Factor, and the product of such calculation shall constitute the "Adjusted
Services Payment".
SECTION 3.06. Interim Statements; Adjusted Services Payment
Statement; Disputes; Payment of Adjusted Services Payment. (a) Within 60 days of
each of the first four anniversaries hereof, Galileo shall calculate, and shall
deliver to the Service Providers (for informational purposes only), a written
statement (each such statement, an "Interim Statement") setting forth Galileo's
preliminary calculation of the Weighted Air Segment Growth Rate for the
preceding year and the Weighted Air Price Increase Rate as of the end of the
preceding year. In no event shall any Service Provider be entitled to dispute
any of the calculations set forth on an Interim Statement.
(b) Within 65 days of the fifth anniversary hereof (or, in the
event Section 3.04(c) is applicable, within 65 days of the date that is six
months after the fifth anniversary hereof), Galileo shall deliver to the Service
Providers a written statement (the "Adjusted Services Payment Statement")
setting forth Galileo's calculation of the Adjusted Services Payment.
(c) Disputes. (i) Subject to clause (ii) of this Section
3.06(c), the Adjusted Services Payment Statement delivered by Galileo to the
Service Providers shall be deemed to be and shall be final, binding and
conclusive on the parties hereto.
(ii) The Service Providers may dispute any amounts reflected
on the Adjusted Services Payment Statement to the extent such disputed
amounts affect the calculation of the Adjusted Services Payment;
provided, however, that the Service Providers shall have notified
Galileo in writing of each disputed item, specifying the amount thereof
in dispute and setting forth, in reasonable detail, the basis for such
dispute, within 15 business days of Galileo's delivery of the Adjusted
Services Payment Statement to the Service Providers. Galileo and the
Service Providers shall attempt in good faith to resolve the matter in
dispute. If Galileo and the Service Providers, notwithstanding such
good faith effort, shall have failed to resolve the matter or matters
in dispute within 15 business days after receipt by Galileo of the
Service Providers' written notice of dispute, Galileo and the Service
Providers shall submit the items remaining in dispute for resolution to
[Name of Accounting Firm] (or, if such firm shall decline to act or is
not, at the time of such submission, independent of Galileo and the
Service Providers, to another independent accounting firm of
international reputation mutually acceptable to Galileo and the Service
Providers) (either [Name of Accounting Firm] or such other accounting
firm being referred to herein as the "Independent Accounting Firm"),
which shall, within 45 business days after such submission, determine
and report to Galileo and the Service Providers upon such remaining
disputed items, and such report shall be final, binding and conclusive
on the parties hereto. The fees and disbursements of the Independent
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Accounting Firm shall be allocated among Galileo and the Service
Providers in the same proportion that the aggregate amount of such
disputed items so submitted to the Independent Accounting Firm that is
unsuccessfully disputed by Galileo, on the one hand, or the Service
Providers, on the other hand (as finally determined by the Independent
Accounting Firm), bears to the total amount of disputed items so
submitted.
(iii) In acting under this Agreement, the Independent
Accounting Firm shall be entitled to the privileges and immunities of
an arbitrator.
(d) Cooperation. For purposes of complying with the terms set
forth herein, each party shall (i) cooperate with and promptly make available to
the other parties and their respective auditors and representatives, all
information, records, data, auditors' working papers, and access to its
personnel, (ii) permit access to its facilities and (iii) permit the other party
and its auditors and representatives to make copies of all information, records,
data and auditor's working papers, in each case as may be reasonably required in
connection with the analysis of the Adjusted Services Payment Statement, the
calculation of the Adjusted Services Payment and the resolution of any
dispute(s) thereunder.
(e) Adjusted Services Payment. Within 5 business days of the
earliest of (i) the date that is 15 business days after the delivery of the
Adjusted Services Payment Statement pursuant to the provisions set forth in
Section 3.06(b) hereof if such Adjusted Services Payment Statement is not
disputed by the Service Providers, (ii) the resolution of all disagreements with
respect to the Adjusted Services Payment Statement directly by Galileo and the
Service Providers and (iii) the issuance of the report of the Independent
Accounting Firm, Galileo shall pay to each of the Service Providers in
immediately available funds to accounts designated in writing by the Service
Providers not later than two business days prior to the date of such payment a
pro rata portion of the Adjusted Services Payment, if any, in proportion to
their respective former percentage interests in ATS immediately prior to the
date hereof. For purposes of any such payment, the Adjusted Services Payment
shall be recalculated to give effect to the Cost of Carry Factor for the period
between the delivery of the Adjusted Services Payment Statement and the actual
date of payment.
SECTION 3.07. Change in Galileo Pricing Methodology. In the
event that, between the date hereof and the fifth anniversary hereof, there is a
fundamental change in Galileo's pricing methodology such that the provisions of
this Article III cannot be implemented in the manner currently intended by the
parties hereto, they shall negotiate in good faith with a view to amending the
provisions of this Article III in order to reflect such fundamental change. In
the absence of any agreement among the parties with regard to any such
amendments, the provisions of this Article III shall be applied in a manner
designed to effectuate, to the greatest possible extent, the parties' original
intentions.
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ARTICLE IV
MISCELLANEOUS
SECTION 4.01. Representations and Warranties. Each of the
parties hereto represents and warrants that this Agreement has been duly
authorized, executed and delivered by such party and constitutes a legal, valid
and binding obligation of such party, enforceable against it in accordance with
the terms of this Agreement.
SECTION 4.02. Notices. All notices, requests, claims, demands
and other communications hereunder shall be in writing and shall be given (and
shall be deemed to have been duly given upon receipt) by delivery in person, by
cable, facsimile, telegram or telex or by registered or certified mail (postage
prepaid, return receipt requested) or by a nationally recognized overnight
courier service to the respective parties at the following addresses (or at such
other address for a party as shall be specified in a notice given in accordance
with this Section 4.02):
(i) if to Galileo:
Galileo International Partnership
0000 X. Xxxxxxxx Xxx
Xxxxxxxxx, Xxxxxxxx 00000
Telecopy: (000) 000-0000
Attention: Xxxxxxx X. Xxxx, Esq.
with a copy to:
Shearman & Sterling
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile: (000) 000-0000
Attention: Xxxxx X'Xxxxx, Esq.
(ii) if to United:
United Air Lines, Inc.
0000 X. Xxxxxxxxx Xxxx
Xxx Xxxxx Xxxxxxxx, Xxxxxxxx 00000
Telecopy: (000) 000-0000
Attention: Xxxxxxxxx X. "Jake" Brace, III
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with a copy to:
Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopy: (000) 000-0000
Attention: Xxxxxx X. Xxxxxxx, Esq.
(iii) if to USAW:
US Airways, Inc.
0000 Xxxxxxx Xxxxx
Xxxxxxxxx, Xxxxxxxx 00000
Telecopy: (703) ___________
Attention: Xxxx Xxxxx
with a copy to:
US Airways, Inc.
0000 Xxxxxxx Xxxxx
Xxxxxxxxx, Xxxxxxxx 00000
Telecopy: (703) ___________
Attention: Xxxxxx Xxxx, Esq.
(iv) if to Air Canada:
Air Canada
C.P. 14,000/P.O. Xxx 00,000
Xxxxxxx Xxxxxxx
Xxxxxx, Xxxxxx
Xxxxxx X0X 0X0
Facsimile: (000) 000-0000
Attention: Xxx Xxxxxx, Esq.
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with a copy to:
Osler, Xxxxxx & Harcourt
1 First Canadian Place
000 Xxxx Xxxxxx Xxxx 00xx Xxxxx
Xxxxxxx, Xxxxxxx
Xxxxxx X0X 0X0
Facsimile: (000) 000-0000
Attention: Xxxxxxxx Xxxxxxxx
SECTION 4.03. Severability. If any term or other provision of
this Agreement is invalid, illegal or incapable of being enforced by any rule of
law, or public policy, all other conditions and provisions of this Agreement
shall nevertheless remain in full force and effect so long as the economic or
legal substance of the transactions contemplated by this Agreement are not
affected in any manner materially adverse to any party. Upon such determination
that any term or other provision is invalid, illegal or incapable of being
enforced, the parties hereto shall negotiate in good faith to modify this
Agreement so as to effect the original intent of the parties as closely as
possible in a mutually acceptable manner in order that the transactions
contemplated by this Agreement be consummated as originally contemplated to the
fullest extent possible.
SECTION 4.04. Term of Agreement. The provisions of this
Agreement (other than Articles I and IV) shall terminate and be of no further
force and effect, automatically and without any required actions of the parties
hereto, on the fifth anniversary of the date hereof; provided, however, that
(i) the provisions of Article II hereof shall terminate on the date on which
Galileo ceases to be a party to a marketing cooperation and sales
representation agreement with each of United and ASAW, but in no event earlier
than the third anniversary hereof, (ii) the provisions of Article III shall
terminate on the date that all payments to be made thereunder are made (or the
date on which the parties agree that no such payment is required to be made),
and (iii) the parties may extend the provisions of any other provision of this
Agreement beyond the fifth anniversary hereof pursuant to an instrument
in writing signed by all of the parties hereto.
SECTION 4.05. Default; Cure Period; Remedies. (a) Upon a
breach of any of the covenants set forth in this Agreement by any of the Service
Providers, such Service Provider shall use its reasonable efforts to cure such
breach within 30 days of receipt of written notice of such breach from Galileo.
(b) Upon a breach of any of the covenants set forth in this
Agreement by Galileo, Galileo shall use its reasonable efforts to cure such
breach within 30 days of receipt of written notice of such breach from any of
the Service Providers.
(c) Galileo acknowledges that its sole and exclusive remedy
for the breach by any Service Provider of its obligations pursuant to Article II
(other than a breach resulting
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from the wilful misconduct or gross negligence of any Service Provider) shall be
specific performance.
(d) Notwithstanding anything to the contrary in this Section
4.05, no Service Provider will be deemed to be in breach of its obligations
under this Agreement so long as any Service Provider is performing its
obligations hereunder.
SECTION 4.06. Confidentiality. Each of the parties hereto
shall keep confidential any information with respect to any of the parties
hereto provided in connection with this Agreement that is not otherwise
generally available to the public, except as may be required by applicable law.
SECTION 4.07. Entire Agreement; Assignment. This Agreement
(including the Exhibits, which are hereby incorporated herein and made a part
hereof for all purposes as if fully set forth herein) constitutes the entire
agreement among the parties with respect to the subject matter hereof and
supersede all prior agreements and undertakings, both written and oral, among
the parties, or any of them, with respect to the subject matter hereof;
provided, however, that to the extent there is a conflict between any provision
of this Agreement as it relates to United and the terms of the Marketing
Cooperation and Sales Representation Agreement, dated as of _______ __, 1997,
between Galileo and United (the "United Sales Representation Agreement"), the
terms of the United Sales Representation Agreement shall govern. This Agreement
shall not be assigned by operation of law or otherwise.
SECTION 4.08. Parties in Interest. This Agreement shall be
binding upon and inure solely to the benefit of each party hereto, and nothing
in this Agreement, express or implied, is intended to or shall confer upon any
other person any right, benefit or remedy of any nature whatsoever under or by
reason of this Agreement.
SECTION 4.09. Governing Law. This Agreement shall be governed
by, and construed in accordance with, the laws of the State of New York
applicable to contracts executed in and to be performed in that state.
SECTION 4.10. Headings. The descriptive headings contained in
this Agreement are included for convenience of reference only and shall not
affect in any way the meaning or interpretation of this Agreement.
SECTION 4.11. Counterparts. This Agreement may be executed and
delivered (including by facsimile transmission) in one or more counterparts, and
by the different parties hereto in separate counterparts, each of which when
executed and delivered shall be deemed to be an original but all of which taken
together shall constitute one and the same agreement.
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IN WITNESS WHEREOF, the parties have caused this Agreement to
be executed as of the date first written above by their respective officers
thereunto duly authorized.
GALILEO INTERNATIONAL, INC.
By: _______________________
Name:
Title:
UNITED AIRLINES, INC.
By: _______________________
Name:
Title:
US AIRWAYS, INC.
By: _______________________
Name:
Title:
AIR CANADA
By: _______________________
Name:
Title:
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EXHIBIT 1
Weighting Factors
Post-Closing Year Weighting
----------------- ---------
1 24%
2 22%
3 20%
4 18%
5 16%
