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EXHIBIT 10.6
CONFIDENTIAL TREATMENT
REQUESTED BY GALILEO
INTERNATIONAL, INC.
MARKETING COOPERATION
AND SALES REPRESENTATION AGREEMENT
between
UNITED AIR LINES, INC.
and
GALILEO INTERNATIONAL, INC.
Dated as of __________________ __, 1997
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CONFIDENTIAL TREATMENT
REQUESTED BY GALILEO
INTERNATIONAL, INC.
MARKETING COOPERATION
AND SALES REPRESENTATION AGREEMENT
Table of Headings
Section Page
------- ----
1 Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
2 Sales Agency and Territories . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2.1 Sales to NTP Subscribers . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2.1.1 Sales Agency Appointment . . . . . . . . . . . . . . . . . . . 2
2.1.2 Designated Subscribers . . . . . . . . . . . . . . . . . . . . 2
2.1.3 Multinational Accounts . . . . . . . . . . . . . . . . . . . . 2
2.2 Sales to CTMS Customers . . . . . . . . . . . . . . . . . . . . . . . . . 3
2.3 Other Sales Agents . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
2.4 Territorial Reassignment . . . . . . . . . . . . . . . . . . . . . . . . . 3
2.5 Trade Names . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
3 The Administration of this Agreement . . . . . . . . . . . . . . . . . . . . . . 4
3.1 GI-Inc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
3.2 United . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
3.3 Meetings and Coordination . . . . . . . . . . . . . . . . . . . . . . . . . 6
4 Responsibilities of United . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
4.1 NTP Sales Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
4.2 Multinational Sales Services . . . . . . . . . . . . . . . . . . . . . . . . 7
4.3 CTMS Sales Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
4.4 Support Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
4.5 Responsibilities With Respect to Excluded Subscribers . . . . . . . . . . . 10
4.6 Sales Planning . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
4.7 Staffing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
4.7.1 Staffing Commitment . . . . . . . . . . . . . . . . . . . . . . . . . 10
4.7.2 Review of Staffing Levels . . . . . . . . . . . . . . . . . . . . . . 10
4.7.3 Employee Proficiency and Training . . . . . . . . . . . . . . . . . . 10
4.7.3.1 Introductory Training . . . . . . . . . . . . . . . . . . . 10
4.7.3.2 Employee Proficiency . . . . . . . . . . . . . . . . . . . . 11
4.7.3.3 Training and Test Materials . . . . . . . . . . . . . . . . 11
5 GI-Inc Responsibilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
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CONFIDENTIAL TREATMENT
REQUESTED BY GALILEO
INTERNATIONAL, INC.
5.1 Marketplace Competitiveness . . . . . . . . . . . . . . . . . . . . . . . . 12
5.2 GI-Inc Support of Sales Services and Support Services . . . . . . . . . . . 12
5.3 Services of GI-Inc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
5.4 New Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
5.5 CTMS Products . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
5.5.1 Base Products . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
5.5.2 Demonstrations . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
5.6 Technical Support . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
5.7 Technical Assistance Offices . . . . . . . . . . . . . . . . . . . . . . . . 13
5.8 Help Desk . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
6 Reporting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
7 Other Marketing Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
7.1 GI-Inc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
7.2 United . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
8 Terms of Payment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
9 Currency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
10 Term . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
11 Confidentiality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
11.1 Confidential Information . . . . . . . . . . . . . . . . . . . . . . . . . . 15
11.2 Service . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
12 Service Marks, Patents, Third Party Data . . . . . . . . . . . . . . . . . . . . 16
12.1 Use of Service Marks . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
12.1.1 GI-Inc Marks . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
12.1.2 United Marks . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
12.2 Patent Indemnity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
12.2.1 Actions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
12.2.2 Limitation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
12.3 Third Party Data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
13 Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
13.1 GI-Inc Responsibilities . . . . . . . . . . . . . . . . . . . . . . . . . . 17
13.2 Claims . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
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CONFIDENTIAL TREATMENT
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INTERNATIONAL, INC.
14 Limitation of Liability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
15 Consequential Damages . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
16 Termination for Breach . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
17 Force Majeure, Delay . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
18 Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
19 Guarantee of Performance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
20 Third Party Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
21 Assignment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
22 Relationship of the Parties . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
23 Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
24 Survival . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
25 Governing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
26 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
27 Headings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
28 Entirety of Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
29 Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
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CONFIDENTIAL TREATMENT
REQUESTED BY GALILEO
INTERNATIONAL, INC.
Table of Attachments
Appendix I . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
[INTENTIONALLY OMITTED -- CONFIDENTIAL TREATMENT REQUESTED]
Appendix II . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
[INTENTIONALLY OMITTED -- CONFIDENTIAL TREATMENT REQUESTED]
Attachment A . . . . . . . . . . . . . . . . . . . . . Defined Terms
Attachment B . . . . . . . . . . . . . . .Dispute Resolution Procedure
Exhibit A . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
[INTENTIONALLY OMITTED -- CONFIDENTIAL TREATMENT REQUESTED]
Exhibit B . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
[INTENTIONALLY OMITTED -- CONFIDENTIAL TREATMENT REQUESTED]
Exhibit C . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
[INTENTIONALLY OMITTED -- CONFIDENTIAL TREATMENT REQUESTED]
Exhibit D . . . . . . . . . . . . . . . . .Sales Representative Reports
Exhibit E . . . . . . . . . . . . . . . . . . . . . Certain Territories
Schedule 1
[INTENTIONALLY OMITTED -- CONFIDENTIAL TREATMENT REQUESTED]
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CONFIDENTIAL TREATMENT
REQUESTED BY GALILEO
INTERNATIONAL, INC.
MARKETING COOPERATION AND SALES REPRESENTATION AGREEMENT
UNITED AIR LINES, INC. AND GALILEO INTERNATIONAL, INC.
This Marketing Cooperation and Sales Representation Agreement (this
"Agreement") effective as of the ___ day of _______, 1997 (the "Effective
Date"), by and between GALILEO INTERNATIONAL, INC., a Delaware corporation
("GI-Inc") with offices at Xxxxx 000, 0000 Xxxx Xxxxxxx Xxxx, Xxxxxxxx,
Xxxxxxxx, 00000, and UNITED AIR LINES, INC., a Delaware corporation ("United")
with offices at 0000 X. Xxxxxxxxx Xxxx, Xxx Xxxxx Xxxxxxxx, Xxxxxxxx 00000.
RECITALS
WHEREAS United and Apollo Travel Services Partnership, a Delaware
general partnership ("Apollo Partnership"), are parties to a Sales
Representative Agreement, dated as of January 1, 1994 (the "Original
Agreement"); and
WHEREAS GI-Inc generates computerized reservations services through
GI-Inc's computer reservation system and distributes such services worldwide for
use by travel-related business entities, by CTMS Customers, and by individual
consumers; and
WHEREAS GI-Inc desires to appoint Sales Representatives that will be
responsible for the sale of GI-Inc's reservations services to such persons and
for the provision of ongoing support services to certain of such persons; and
WHEREAS The parties hereto agree that, because of the competitiveness of
the products and services of GI-Inc vis-a-vis like products and services of all
other companies within the CRS Industry, United is desirous of entering into
this Agreement; and
WHEREAS The parties hereto agree that, because of United's knowledge of
and contact with a substantial portion of the community of travel agents within
the Territory, GI-Inc is desirous of entering into this Agreement; and
WHEREAS United and Apollo Partnership intend to terminate the Original
Agreement and United desires to be a Sales Representative for GI-Inc under the
terms and conditions of this Agreement;
NOW, THEREFORE, in consideration of the mutual covenants set forth in
this Agreement, GI-Inc and United hereby agree as follows:
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CONFIDENTIAL TREATMENT 2
REQUESTED BY GALILEO
INTERNATIONAL, INC.
1 Definitions.
Capitalized terms used as defined terms in this Agreement have, unless
otherwise defined elsewhere in this Agreement, the meanings provided for each
in Attachment A hereto.
2 Sales Agency and Territories.
2.1 Sales to NTP Subscribers.
2.1.1 Sales Agency Appointment.
With respect to the Assigned Subscribers, GI-Inc hereby
appoints United as the exclusive limited agent of GI-Inc to
obtain commitments from the Assigned Subscribers to subscribe for
and lease Galileo Services. Except as provided in Section 4.2
below, United will act as the sales agent of GI-Inc only for the
limited purposes of negotiating and obtaining written commitments
from NTP Subscribers on terms and in a form prepared and approved
in advance by GI-Inc.
2.1.2 Designated Subscribers.
Exhibit C hereto lists the NTP Subscribers with locations
in the sales territories of more than one sales representative for
whom United is the designated provider of Sales Services and
Support Services. United is the exclusive provider of Sales
Services and Support Services for all locations of such NTP
Subscribers in the Territory. GI-Inc may add or delete NTP
Subscribers from such Exhibit C only with United's consent.
All NTP Subscribers listed on Exhibit C are "Excluded Subscribers"
for all other sales representatives of GI-Inc, including for GI-Inc
itself.
2.1.3 Multinational Accounts.
An NTP Subscriber whose Headquarters is in the Territory and
that has outlets (whether owned, licensed, or otherwise) for its
business in both the Territory and outside of the Territory is, for
the purposes of this Agreement, a "Multinational Account". GI-Inc
has overall responsibility with respect to Multinational Accounts,
including the provision of services to and all payments of
Financial Assistance to such Multinational Accounts, provided,
however, that United has responsibility for the negotiations with
Multinational Accounts with respect to the products and services of
GI-Inc, and United and GI-Inc agree that United together with
GI-Inc shall undertake all such negotiations pursuant to this
Agreement, including, without limitation, the Multinational
Procedure as
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CONFIDENTIAL TREATMENT 3
REQUESTED BY GALILEO
INTERNATIONAL, INC.
described in Section 4.2 below. Exhibit C to this Agreement lists the
Multinational Accounts as of the Effective Date. Subsequent to the
Effective Date, United shall assume the responsibilities described in this
Section 2.1.3 with respect to any National Account that, during the term
of this Agreement, becomes a Multinational Account, whether by growth,
merger, business combination, or otherwise. In the event that any
Multinational Account ceases to be a Multinational Account during the term
of this Agreement (a "Discontinued Multinational Account"), then such
Discontinued Multinational Account shall no longer be deemed to be a
Multinational Account but shall be deemed to be a Designated Subscriber.
2.2 Sales to CTMS Customers.
With respect to CTMS Customers and CTMS Agents, GI-Inc hereby appoints
United as its non-exclusive limited agent to obtain commitments from CTMS
Customers and CTMS Agents to purchase, license, or lease CTMS Services.
Pursuant to Section 4.3 below, and except in those territories where GI-Inc has
granted exclusive distribution rights to third parties with respect to Galileo
Services and CTMS Services, as listed in Exhibit E hereto, United may act as
the sales agent of GI-Inc worldwide for the limited purposes of negotiating and
obtaining written commitments from CTMS Customers and CTMS Agents on terms
and in a form prepared and approved in advance by GI-Inc.
2.3 Other Sales Agents.
Subject to this Section 2 and to Section 3 below, GI-Inc may at its
discretion appoint other persons as sales agents of GI-Inc and GI-Inc may act
on its own behalf as sales agent. GI-Inc will treat each of its sales agents
in a fair and nondiscriminatory manner and as appropriate in a manner
proportionate to United's responsibilities hereunder with respect to the terms
and conditions of its appointment as a sales representative, including, but not
limited to, the provision of Sales Services, Support Services, training, the
criteria for approvals of Form Agreements, the compensation arrangements
provided by GI-Inc, and in all associated support functions that are GI-Inc's
responsibility hereunder.
2.4 Territorial Reassignment.
A "Territorial Reassignment" shall occur in the event of (i) a
reassignment by GI-Inc among its sales representatives of territories outside
of the APR but within the Territory, or (ii) the termination of any arrangement
regarding sales agency between GI-Inc and another sales representative of
GI-Inc who is performing as a sales agent within the Territory but not within
the APR (an "Other Agent"). In the event of a
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CONFIDENTIAL TREATMENT 4
REQUESTED BY GALILEO
INTERNATIONAL, INC.
Territorial Reassignment, GI-Inc will offer to United the right of first
refusal to assume sales agent responsibility within such reassigned
territory or within the territory of such terminated Other Agent. Before
such territories are assigned to United, GI-Inc and United will negotiate
in good faith to adjust the performance objectives and the compensation
therefor as provided in Appendix II. If United and GI-Inc are unable
within ninety days (90 days) from the commencement of such negotiations to
agree on the terms of adjustment for the performance objectives and the
compensation then GI-Inc shall be free to make the Territorial Reassignment
to any other agent or GI-Inc may perform such sales function for itself.
2.5 Trade Names.
During the term of this Agreement and except as otherwise provided in
this Agreement, with respect to the APR, GI-Inc will market, and United
will sell, the Reservations Services and CTMS Services of GI-Inc under the
"Apollo" trade name. Notwithstanding the foregoing, if, as a result of
United's efforts under this Agreement, a customer of GI-Inc commits to
purchase GI-Inc products or services outside of the Territory then GI-Inc
will determine the trade name for such products or services outside of the
Territory . For the purposes of this Agreement it is assumed, without
obligation on GI-Inc's part, that such trade name outside the Territory is
"Galileo".
3 The Administration of this Agreement.
United and GI-Inc agree that the proper and efficient administration of each
party's obligations under this Agreement is essential to meeting the objectives
of the parties hereunder. To this purpose, the parties agree to dedicate
appropriate staff and resources at an executive level, and otherwise, as
follows:
3.1 GI-Inc.
At all times during the term of this Agreement GI-Inc will employ an
individual who shall have primary responsibility for meeting GI-Inc's
obligations under this Agreement, which person shall be a duly appointed
officer of GI-Inc (the "GI-Inc Executive"). The GI-Inc Executive shall
report directly to the President and Chief Executive Officer of GI-Inc.
The GI-Inc Executive shall be a person who has experience and background
commensurate with his or her responsibilities. The GI-Inc Executive will
maintain an office in the Chicago metropolitan region.
The GI-Inc Executive shall have full authority to bind GI-Inc in all
matters regarding this Agreement that may arise during the term of this
Agreement, subject to
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CONFIDENTIAL TREATMENT 5
REQUESTED BY GALILEO
INTERNATIONAL, INC.
the provisions of the corporate by-laws and commitment authorities
of GI-Inc as approved by GI-Inc's Board of Directors or CEO, including,
without limitation:
(i) matters regarding Financial Assistance;
(ii) the approval of agreements with current and potential customers of
GI-Inc that are negotiated by United on GI-Inc's behalf pursuant to
this Agreement;
(iii) the negotiation with United of goals and targets related to
GI-Inc's and United's performance under this Agreement;
(iv) the compensation owed United by GI-Inc under this Agreement,
including the negotiation and payment thereof;
(v) the quantity, quality of performance and training of personnel
provided by GI-Inc pursuant to its obligations under this
Agreement;
(vi) the coordination of GI-Inc's role in negotiations with any third
party where such negotiations involve the participation of parties
other than GI-Inc, United, and that third party; and
(vii) the coordination and resolution of any issues arising under this
Agreement that, in United's or GI-Inc's estimation, are affected by
actions that have been or may be taken by other sales agents of
GI-Inc or by GI-Inc.
The GI-Inc Executive may delegate to employees of GI-Inc or to persons
under the control of GI-Inc such matters that are his or her responsibility
hereunder and as may be, in the GI-Inc Executive's discretion, appropriate for
delegation provided that, if United reasonably objects that such delegation will
result in a diminishment of GI-Inc's performance hereunder or in a detriment to
United's ability to perform its obligations hereunder, or both, then GI-Inc will
review the proposed delegation and inform United as to how GI-Inc will address
United's reasonable concerns.
3.2 United.
At all times during the term of this Agreement United will employ an
individual to have primary responsibility for meeting United's obligations
under this Agreement, which person shall be a duly appointed officer of United
(the "United Executive"). The United Executive shall he a person who has
experience and background commensurate with his or her responsibilities. The
United Executive will maintain an office in the Chicago metropolitan region.
The United Executive shall have full authority to bind United in all matters
regarding this Agreement that may arise during the term of this Agreement,
subject to the provisions of the corporate by-laws and commitment
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CONFIDENTIAL TREATMENT 6
REQUESTED BY GALILEO
INTERNATIONAL, INC.
authorities of United Air Lines, Inc., as approved by United Air Lines,
Inc.'s Board of Directors or CEO, including, without limitation:
(i) the conduct of United's negotiations with current and potential
customers of GI-Inc on GI-Inc's behalf pursuant to this Agreement;
(ii) the negotiation with GI-Inc of goals and targets related to
GI-Inc's and United's performance under this Agreement;
(iii) the compensation owed United by GI-Inc under this agreement,
including the negotiation and payment thereof;
(iv) the quantity, quality of performance and training of personnel
provided by United pursuant to its obligations under this
Agreement;
(v) the coordination of United's role in negotiations with any third
party where such negotiations involve the participation of parties
other than GI-Inc, United, and that third party; and
(vi) the coordination and resolution of any issues arising under this
Agreement that, in United's or GI-Inc's estimation, are affected by
actions that have been or may be taken by other sales agents of
GI-Inc or by GI-Inc.
The United Executive may delegate to employees of United or to persons
under the control of United such matters that are his or her responsibility
hereunder and as may be, in the United Executive's estimation, appropriate
for delegation, provided that, if GI-Inc reasonably objects that such
delegation will result in a diminishment of United's performance hereunder
or in a detriment to GI-Inc's ability to perform its obligations hereunder,
or both, then United will review the proposed delegation and inform GI-Inc
as to how United will address GI-Inc's reasonable concerns.
3.3 Meetings and Coordination.
The GI-Inc Executive and the United Executive shall meet from time to
time, whether telephonically or in person and on a schedule to which
they mutually agree, to review the progress of each party's performance
under this Agreement as well as general economic and travel industry market
conditions or factors that may potentially affect one or the other party
performance hereunder.
4 Responsibilities of United.
4.1 NTP Sales Services.
Primarily using United's General Sales Personnel, United will
actively engage in the sale, marketing, and promotion of Galileo Services
to the Assigned Subscribers.
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CONFIDENTIAL TREATMENT 7
REQUESTED BY GALILEO
INTERNATIONAL, INC.
To this end, United will perform the following services for GI-Inc
pursuant to this Agreement (such services are, collectively, "NTP Sales
Services"):
(i) Scope. United will engage in NTP Sales Services regarding only
those Galileo Services as directed or authorized in advance by GI-
Inc.
(ii) Contact. United will maintain current and establish new personal a
nd telephone contact and sales relationships, including, where
appropriate, in person or telephone sales calls. At GI-Inc's
expense, United may, on approval of GI-Inc, undertake direct mail
solicitations, promotions, and other sales efforts, with NTP
Subscribers within the APR. GI-Inc may disapprove any sales
promotion or solicitation with respect to the Galileo Services that
GI-Inc in its reasonable discretion determines to be contrary to
the objectives or policies of GI-Inc.
(iii) Commitment Review Procedure. United shall follow the Commitment
Review Procedure described in Section 5.2 below.
(iv) Support Services. Subject to the NTP Form Agreement and within the
Negotiation Range, United shall offer to NTP Subscribers within the
APR such NTP Support Services as are approved in advance by GI-Inc.
(v) Discontinued Services. Upon receipt of a Discontinued Service
Notice, as such term is defined in Section 5.1 below, United will
cease Sales Services regarding such Galileo Service or feature.
(vi) Changes to United Organization. United will give GI-Inc prompt
written notice regarding any significant re-organization,
redeployment or change of responsibilities of its General
Sales Personnel (an "Organization Change"). If such Organization
Change is likely to result in an inability of United to perform NTP
Sales Services in a metropolitan area in the APR that provides a
significant portion of Total Revenue then United will notify GI-Inc
as to whether
(a) United chooses to continue providing services under this
Agreement in such area, in which case United will propose to
GI-Inc how United will staff the necessary Sales Force
coverage for such area, and GI-Inc will review United's
proposal in good faith and determine whether it accepts the
proposal; or
(b) United chooses not to continue providing services under this
Agreement in such area.
In the event of (b), above, or of GI-Inc's rejection of United's
proposal in (a), above, then GI-Inc may reassign sales
responsibility in such area to another person, including to GI-Inc
itself.
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CONFIDENTIAL TREATMENT 8
REQUESTED BY GALILEO
INTERNATIONAL, INC.
4.2 Multinational Sales Services.
United will actively engage in the sale, marketing, and promotion
of Galileo Services to Multinationals. To this end, and notwithstanding
the provisions of Section 4.1 above, United will perform the following services
for GI-Inc pursuant to this Agreement (such services are, collectively,
"Multinational Sales Services"):
(i) Scope. United will engage in Multinational Sales Services regarding
only those Galileo Services as directed or authorized in advance by
GI-Inc.
(ii) Multinational Procedure; GI-Inc Lead; United Lead. With respect to the
management of the account of each Multinational, the GI-Inc Executive
shall appoint an individual (the "GI-Inc Lead") and the United Executive
shall appoint an individual (the "United Lead") who shall have joint
responsibility for the preparation and conduct of negotiations with that
Multinational. The following procedure (the "Multinational Procedure")
shall apply to the preparation and conduct of such negotiations:
(a) US Deal. The United Lead shall be the lead negotiator in negotiations
with a Multinational that apply to Galileo Services that are to be
provided by GI-Inc in at least the United States of America (a "US
Deal").
(b) Sales Calls. All sales calls related to a US Deal and made in person
with the Multinational shall be made jointly by the United Lead and
the GI-Inc Lead. The GI-Inc Lead and the United Lead shall jointly
coordinate contacts and meetings, whether in person or telephonic or
via some other electronic means, with the Multinational. In the event
that the Multinational initiates contact with one Lead outside of the
presence of the other Lead, then the contacted Lead will promptly
provide the other Lead with information about such contact insofar as
it relates to the subject matter of this Agreement. In no case will
any GI-Inc employee or agent discuss any element of United's business
with the Multinational without United's prior knowledge and consent.
(c) Account Leads - Non-US Deals. In the case of negotiations with a
Multinational that are not related to a US Deal, this Agreement does
not apply, provided that, GI-Inc will regularly provide United with any
information related to such non-United States of America negotiations
or services that may reasonably be understood to be related either to
the conduct and maintenance of United's good relations with such
Multinational or to United's effective performance under this
Agreement, or both. GI-Inc will endeavor to provide to United in
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CONFIDENTIAL TREATMENT 9
REQUESTED BY GALILEO
INTERNATIONAL, INC.
advance of the presentation of proposals with respect
to non-US Deals to Multinationals, a summary of the
terms of such proposals. If United provides GI-Inc
with United's reasonable objections to such terms to
the effect that such terms will, in United estimate,
have a negative effect on United ability to negotiate
acceptable US Deals in the future, with respect to
Financial Assistance or otherwise, then GI-Inc will
take United's objections into account. If GI-Inc
negotiates a non-US Deal that includes a level of
Financial Assistance for a Multinational that is
greater than the level of Financial Assistance then
currently agreed with that Multinational under a US
Deal then GI-Inc will not thereafter attempt to
increase the Revenue Goal or reduce the FA Budget to
offset such increased Financial Assistance.
4.3 CTMS Sales Services.
United will actively engage in the sale, marketing, and promotion of
CTMS Services to CTMS Customers and CTMS Agents. To this end, United will
perform the following services for GI-Inc pursuant to this Agreement (such
services are, collectively, "CTMS Sales Services"):
(i) Scope. United will engage in CTMS Sales Services regarding only
those CTMS Services as directed or authorized in advance by GI-Inc.
(ii) Product Licensing. As GI-Inc's non-exclusive sales agent for the
licensing of CTMS Services, subject to Section 2.2 above, United may
market and license CTMS Services to CTMS Customers and to CTMS
Agents. The parties will work together to develop marketing plans for
CTMS Services, including the name or names of products.
(iii) Contact. United will maintain current and establish new personal
and telephone contact and sales relationships, including, where
appropriate, in person or telephone sales calls with CTMS Customers
and CTMS Agents. At GI-Inc's expense, United may, on approval of
GI-Inc, undertake direct mail solicitations, promotions, and other
sales efforts, with CTMS Customers and CTMS Agents. GI-Inc may
disapprove any sales promotion or solicitation with respect to the
CTMS Services that GI-Inc in its reasonable discretion determines to
be contrary to the objectives or policies of GI-Inc.
(iv) Commitment Review Procedure. United shall follow the Commitment
Review Procedure described in Section 5.2 below.
(v) CTMS Support Services. Subject to the CTMS Form Agreement and within
the Negotiation Range, United shall offer to CTMS Customers or CTMS
Agents, or
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CONFIDENTIAL TREATMENT 10
REQUESTED BY GALILEO
INTERNATIONAL, INC.
both, as the case may be, such CTMS Support Services as are approved
in advance by GI-Inc.
(vi) Discontinued Services. Upon receipt of a Discontinued Service
Notice, as such term is defined in 5.1 below, United will cease CTMS
Sales Services regarding such CTMS Service.
4.4 Support Services.
In addition to the Sales Services, United will perform the following
services for GI-Inc pursuant to this Agreement for those NTP Subscribers
with annual HOL Flow in excess of $5 million (such services are,
collectively, "Support Services").
(i) Support Services Calls. Responses to inquiries from, and regular
premises visits and assistance to, NTP Subscribers in order to
establish and maintain good relations and to improve relations
between NTP Subscribers and GI-Inc, and to aid in familiarization
with and use of Galileo Services and CTMS Services.
(ii) Technical Questions Received. United will relay promptly to GI-Inc
any technical questions received by United from customers of GI-Inc
and, as requested by GI-Inc, will coordinate responses thereto.
(iii) Area of Support. United will be responsible for Support Services for
locations of NTP Subscribers within the APR, and as designated by
GI-Inc outside of the APR (although associated revenue from non-APR
Subscribers designated for support will be included in Total
Revenue).
4.5 Responsibilities With Respect to Excluded Subscribers.
United will not enter into sales negotiations with Excluded
Subscribers except with the prior written approval of GI-Inc. GI-Inc may
add or delete NTP Subscribers as Excluded Subscribers on Exhibit B hereto
after consulting with and receiving the consent of all affected sales
representatives, including United. Revenues from all Assigned Subscribers
who become Excluded Subscribers will continue to be counted for that year
in the Total Revenue. United may negotiate with NTP Subscribers regarding
sales commitments outside of the APR (i) after prior notice to GI-Inc, (ii)
after a reasonable period of time in which GI-Inc has had the opportunity
to coordinate such sales calls with its own sales force and with GI-Inc's
other sales representatives, and (iii) after consent of GI-Inc. Only those
sales outside of the APR approved in advance by GI-Inc will be included in
Total Revenue totals.
4.6 Sales Planning.
Subject to Appendix II, and in no event later than February 28 of
each year, GI-Inc and United jointly will develop a sales plan for such
year, which sales plan will be
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CONFIDENTIAL TREATMENT 11
REQUESTED BY GALILEO
INTERNATIONAL, INC.
designed to increase business opportunities, procure profitable NTP
Subscriber accounts for GI-Inc and attain or exceed the Revenue Goal.
4.7 Staffing.
4.7.1 Staffing Commitment.
As described in Appendix I, United will staff a Sales Force who
will provide Sales Services to GI-Inc under this Agreement.
4.7.2 Review of Staffing Levels.
United will consult with GI-Inc from time to time as requested
by either party to review the job descriptions, minimum
qualifications, career paths, and other matters in connection with the
Sales Force. United will consult with GI-Inc regarding the staffing
of Dedicated Personnel and Active Support Personnel positions to be
provided under this Agreement. Such consultations will include review
of job descriptions and necessary qualifications, consideration of
possible applicants from GI-Inc and United as well as third parties,
and full consultation and review of proposed training schedules for
each Dedicated Personnel and Active Support Personnel.
4.7.3 Employee Proficiency and Training.
4.7.3.1 Introductory Training.
Prior to commencing any Sales Services on behalf of
GI-Inc hereunder, all Sales Force personnel of United must
attend a five-day introductory training course and, thereafter,
a two-day refresher training course at least once annually, at
a location or locations to be mutually agreed between United
and GI-Inc. As new GI-Inc products or services are released by
GI-Inc for Sales Services hereunder, GI-Inc will provide
training with respect thereto to the Sales Force at a location
or locations as agreed by the parties. GI-Inc will bear its
own expenses in providing the training and United will bear its
own expenses of the Sales Force in attending such training.
4.7.3.2 Employee Proficiency.
United will take all reasonable steps to ensure that
all of the Sales Force who are authorized to sell or support
the products and services of GI-Inc hereunder have been trained
appropriately and are proficient to provide Sales Services in
accordance with the terms of this Agreement.
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CONFIDENTIAL TREATMENT 12
REQUESTED BY GALILEO
INTERNATIONAL, INC.
GI-Inc shall have the right to test the proficiency of
individual Sales Force personnel at the time of their
refresher training and to require additional training for
such individuals as do not demonstrate minimum proficiency.
GI-Inc will provide all course materials, test materials,
and training facilities necessary to provide such additional
training, and United and GI-Inc will mutually establish a
reasonable schedule for the administration of such
additional training. Sales Force personnel who have
completed such additional training will be again tested and
those who again demonstrate an inability to achieve the
minimum level of proficiency will not be counted toward the
required staffing levels prescribed in this Section 4.7.
4.7.3.3 Training and Test Materials.
GI-Inc will provide to United in advance of their
use copies of all introductory training materials, refresher
training materials, and proficiency test vehicles to he used
pursuant to this Section 4.7.3 (collectively, the "Training
Materials"). The Training Materials will always be
constructed according to the best practices for Training
Materials then employed by U.S. industry and shall be
related solely to the reasonable skills required of a person
engaged in the sales of products and services such as those
of GI-Inc. United may, at its request, review such Training
Materials in advance of their use hereunder and GI-Inc will
make all reasonable changes requested by United to the
Training Materials.
5 GI-Inc Responsibilities.
5.1 Marketplace Competitiveness.
GI-Inc will at all times during the term of this Agreement use its
best efforts to ensure that Galileo Services maintain a superior level of
competitiveness in the CRS Industry. GI-Inc will give United as much
notice as is reasonably practicable if GI-Inc discontinues general
distribution or provision of any particular Galileo Service or CTMS Service
or major feature thereof (a "Discontinued Service Notice")
5.2 GI-Inc Support of Sales Services and Support Services.
With the objective of ensuring the proper level of GI-Inc support for
Sales Services and for Support Services provided by United under this
Agreement, GI-Inc will provide the following support to United
(collectively, the "GI-Inc Support"):
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CONFIDENTIAL TREATMENT 13
REQUESTED BY GALILEO
INTERNATIONAL, INC.
(i) Copies. GI-Inc will ensure that United at all times has a
current copy of each version of the Form Agreements together with
such commentary or explanation of the Form Agreements as may be
reasonably required by United for the comprehension and
understanding of the Form Agreements.
(ii) Changes to Form Agreements. GI-Inc will provide United with no
less than 30 days written notice in the event that GI-Inc
modifies or discontinues the use of any of the Form Agreements.
5.3 Services of GI-Inc.
GI-Inc will provide Galileo Services, CTMS Services and New
Services to NTP Subscribers, CTMS Customers and CTMS Agents, subject
to the terms of the Form Agreements as negotiated by Untied and
approved by GI-Inc pursuant to this Agreement.
5.4 New Services.
GI-Inc will not distribute any Galileo Service (but excluding
enhancements or replacements of any Galileo Service) that did not
exist as of the Effective Date (a "New Service") through any sales
representative in the Territory, and including GI-Inc itself, without
first offering United the right of first refusal to become the
exclusive sales agent for such New Service for the APR. GI-Inc and
United shall negotiate on the reasonable terms of such agency,
including the performance objectives and the compensation therefor as
provided in Appendix II. Failing agreement with United within ninety
days (90 days) of the inception of such negotiations, GI-Inc may, upon
giving notice to United pursuant to Section 26, below, make the other
sales representative arrangements for the New Service within the
Territory.
5.5 CTMS Products.
5.5.1 Base Products.
GI-Inc has the ultimate role in determining product
specifications and features of any CTMS Service, and GI-Inc will
ensure that such specifications and product implementations of
such specifications meet prevailing market needs. To that end,
the GI-Inc Executive shall consult regularly with the United
Executive as to information that United may gather in the course
of its business that United believes is relevant to ensuring that
the CTMS Service is competitive with like services and products
provided by other service providers.
5.5.2 Demonstrations.
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CONFIDENTIAL TREATMENT 14
REQUESTED BY GALILEO
INTERNATIONAL, INC.
Upon United's request, subject to GI-Inc.'s agreement, GI-Inc, at
its expense, will provide demonstrations of CTMS Services to CTMS
Customers and/or CTMS Agents. GI-Inc will coordinate the content and
scheduling of such demonstrations with United.
5.6 Technical Support.
GI-Inc will provide in a good and workmanlike manner all installation,
connection, and testing of all Galileo Services, CTMS Services and any
field or technical support or field maintenance required by NTP
Subscribers, CTMS Customers, or CTMS Agents. GI-Inc will maintain ongoing
and appropriate contact with NTP Subscribers, CTMS Customers and CTMS
Agents to facilitate user operation of the Galileo Services and CTMS
Services. Technical sales consulting support will also be provided by
GI-Inc to the Sales Force.
5.7 Technical Assistance Offices.
GI-Inc will maintain regional Tech Offices for the use of its sales
representatives that will be staffed by knowledgeable employees capable of
providing technical assistance regarding Galileo Services and CTMS
Services. Such assistance will be available to United during normal GI-Inc
business hours.
5.8 Help Desk.
GI-Inc, at its expense, will maintain a telephone call center or
centers for use by the Sales Force, NTP Subscribers, CTMS Customers, and
CTMS Agents during normal business hours for each of those persons in their
places of business. The call centers will be staffed by knowledgeable
persons under the control of GI-Inc who are capable of providing prompt,
thorough, courteous, and professional technical assistance regarding the
products and services of GI-Inc.
6 Reporting.
United will furnish, at no cost to GI-Inc, the reports and documents set
forth in Exhibit D hereto.
7 Other Marketing Rights.
7.1 GI-Inc.
GI-Inc reserves the right to market and to support services in the
Sales APR. During the term of this Agreement, and except as otherwise
provided in this
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CONFIDENTIAL TREATMENT 15
REQUESTED BY GALILEO
INTERNATIONAL, INC.
Agreement, GI-Inc will not designate the Sales APR of United as the area
of primary sales responsibility of any other sales agent of GI-Inc,
including GI-Inc itself.
7.2 United.
Subject to the provisions of the Non-Competition Agreement, while United
is the sales agent of GI-Inc under the terms of this Agreement, United
will not act as a sales agent for the reservations or accounting
services of another entity in the CRS Industry in the APR without the
prior consent of GI-Inc, provided, however, that nothing in this Agreement
will prevent United from:
(i) having United Group Products and Services displayed or listed in any
person's computer reservation system, schedule, other electronic or
paper communications medium, or otherwise;
(ii) providing to any person any technological or computerized means of
delivering information and automation functionality;
(iii) authorizing any person to use United's trademarks and trade names
in connection with advertising United's participation in such
person's computer information or reservation system, or otherwise;
(iv) endorsing the products or services of another member of the CRS
Industry, provided, however, that United may not endorse such
products or services of such other member of the CRS Industry as
being preferred to those of GI-Inc, provided, however, (a) if
GI-Inc does not itself provide such products or services, or
(b) GI-Inc provides such products or services but they do not meet
United's needs, then, subject to the provisions of the
Non-Competition Agreement, United may endorse such products or
services of such other member of the CRS Industry in any manner.
8 Terms of Payment.
GI-Inc will pay United quarterly in arrears, upon receipt and acceptance by
GI-Inc of United's reports pursuant to Section 6 above for the preceding
quarter and of its invoice therefor, an amount equal to one quarter of the Base
Compensation. Invoices will be prepared and mailed on the first work day of
April, July, October and January of each year. After the end of each calendar
year, following receipt and acceptance by GI-Inc of United's report pursuant to
Section 6 above with results for the year as a whole, adjustments will be made
as required by Appendix II, and GI-Inc or United, as appropriate, will make
payment to the other in an amount determined in accordance with the application
of such Section. All payments hereunder will be made within 30 days of date of
invoice by wire transfer, banking instructions to be given by the recipient
thereof in advance of each such transfer. All amounts due and
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CONFIDENTIAL TREATMENT 14
REQUESTED BY GALILEO
INTERNATIONAL, INC.
payable hereunder and not paid within 30 days of date of invoice shall be
subject to late payment interest subject to the following: (i) the Interest
Rate shall be fixed as of the due date of the invoice, and (ii) interest shall
be calculated, on the basis of a 360-day year, from the due date.
9 Currency.
For the purposes of this Agreement all currency calculations shall be in US
Dollars and, to the extent paid in a currency other than US Dollars, revenue
received by GI-Inc or expenses incurred by GI-Inc will be converted to US
Dollars at the exchange rate in effect at the date of the receipt of such
revenue or payment of such expense, as the case may be.
10 Term.
This Agreement is effective as of the Effective Date, and will continue
until the termination of the Non-Competition Agreement. GI-Inc may issue, no
earlier than July 1 of each year a conditional notice of termination if GI-Inc
has reasonably determined that United may, as a result of its own failure to
perform and not as a result of a Material Change, not meet its then current
Revenue Goal; if, as of 120 days after such conditional notice, GI-Inc
reasonably determines that United will not meet such Revenue Goal and so
notifies United, this Agreement will terminate 90 days after such determination
(with no sales exclusivity during the last 30 days of the 90 day period) and
United will be paid for sales services during the last 30 days only at direct
labor cost (adjusted to reflect time devoted to GI-Inc) and associated
expenses.
11 Confidentiality.
11.1 Confidential Information.
Confidential information, including, without limitation, source code,
object code, manufacturing, financial and marketing data, orders,
forecasts, plans, designs, drawings and specifications of either United
or GI-Inc, which is contained in tangible records designated as
"CONFIDENTIAL", "TRADE SECRET" or "PROPRIETARY", or which is otherwise
communicated on the express basis that the information is confidential,
and which is provided to the other party during the performance of this
Agreement (hereafter "Confidential Information"), will be treated as
confidential and not further disclosed to any third party without the
prior written consent of the providing party, except as provided under the
terms of this Agreement, for five years from the date such Confidential
Information was first received, unless such Confidential Information was
already in the possession of the other party, is placed in the public
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CONFIDENTIAL TREATMENT 17
REQUESTED BY GALILEO
INTERNATIONAL, INC.
domain through no fault of the party receiving such information, or
becomes rightfully available to the other party through other sources
without restriction on disclosure.
11.2 Service.
If either party is served with a subpoena or other legal process
requiring the production or disclosure of any Confidential Information or
United Information, then that party will immediately notify the owner
thereof, and will in good faith attempt to permit the owner at the owner's
expense to intervene and contest such disclosure or production.
12 Service Marks, Patents, Third Party Data.
12.1 Use of Service Marks.
12.1.1 GI-Inc Marks.
United will use and display the GI-Inc trade and
service marks in the form specified by GI-Inc. United will market
the Galileo Services and CTMS Services under product names
established by GI-Inc and must identify all such Galileo
Services and CTMS Services as the products or services of GI-Inc.
United may include its name and identifying marks in association
with the name "GI-Inc". GI-Inc reserves the right to disapprove
any use of the trade and service marks and other proprietary rights
of GI-Inc if GI-Inc determines in its reasonable discretion that
such use is contrary to the objectives or policies of GI-Inc.
12.1.2 United Marks.
GI-Inc will not use the trade or service marks of
United without United's prior written consent. United reserves
the right to disapprove any use of the trade and service marks and
other proprietary rights of United if United determines in its
reasonable discretion that such use is contrary to the objectives
or policies of United.
12.2 Patent Indemnity.
12.2.1 Actions.
GI-Inc will defend at its expense any suit or
proceeding against United based on a claim that any product or
service of GI-Inc ("GI-Inc Product") constitutes an infringement of
the patent, trademark, or copyright laws of the United States,
provided that GI-Inc is notified promptly in writing
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CONFIDENTIAL TREATMENT 18
REQUESTED BY GALILEO
INTERNATIONAL, INC.
and given full and complete authority, information, and assistance
for the defense of such suit or proceeding. If the foregoing
provision is complied with, GI-Inc will pay damages and costs
awarded against United, but GI-Inc will not be responsible for any
compromise or settlement made without its prior written consent.
If any GI-Inc Product is held to constitute infringement of such
patent, trademark, or copyright and its use is enjoined, GI-Inc
will, at its election and expense, either obtain for United the
right to continue using such GI-Inc Product, modify such GI-Inc
Product so that it is not infringing, or remove such GI-Inc
Product.
12.2.2 Limitation.
GI-Inc will not be liable to United with respect
to any claim of infringement which is based upon (a)
combination or utilization of an GI-Inc Product with products or
services not supplied by GI-Inc; (b) the unauthorized modification
by United or a person other than GI-Inc or its designated
representatives of any GI-Inc Product or (c) the use of any GI-Inc
Product not in accordance with GI-Inc's specifications or
recommendations.
12.3 Third Party Data.
GI-Inc makes no representation or warranty regarding the accuracy
or reliability of any schedule, fare, quote, or other information provided
to GI-Inc by airlines or by hotels, car rental companies or other vendors
of travel related services. GI-Inc will not be responsible for, and
United hereby releases and waives any claims against GI-Inc conceding, the
accuracy or reliability of any such information provided by such third
parties.
13 Taxes.
13.1 GI-Inc Responsibilities.
GI-Inc will pay any sales, use, or personal property taxes
(except for any tax levied upon or measured by United's gross
receipts) imposed by any taxing authority and required to be paid by
GI-Inc or United as a result of services provided to GI-Inc under this
Agreement. GI-Inc will not be liable for any tax levied upon or
measured by the income of United.
13.2 Claims.
If a claim is made against United for any taxes that are to be
paid by GI-Inc, United will timely notify GI-Inc. If GI-Inc so requests
in writing, United will, at GI-Inc's expense, take such action as GI-Inc
may reasonably direct with respect to such
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CONFIDENTIAL TREATMENT 19
REQUESTED BY GALILEO
INTERNATIONAL, INC.
taxes, including payment of such taxes under protest. If the tax has
been paid, and if requested by GI-Inc, United will, at GI-Inc's
expense, take such action as GI-Inc may reasonably direct, including
allowing GI-Inc to file a claim or commence legal action in United's
name, to recover such tax payment. In the event of refund or recovery
of any tax, or part thereof, United will pay to GI-Inc promptly that
portion of the tax paid by GI-Inc, including any interest received
thereon.
14 Limitation of Liability.
Except as provided under Section 18 below ("Indemnification"), each
party's total liability regarding any claim by the other party for breach of
this Agreement is limited to the amount of compensation earned by United for
the year in which the claim arises or, if based on obligations of a continuing
nature and arising after termination, then the final year of this Agreement,
and each party hereby releases and waives any claims against the other party
for such breach in excess of such amount.
15 Consequential Damages.
NEITHER PARTY WILL BE LIABLE FOR, AND EACH PARTY WAIVES AND RELEASES
ANY CLAIMS AGAINST THE OTHER PARTY FOR, ANY SPECIAL, INCIDENTAL, OR
CONSEQUENTIAL DAMAGES, INCLUDING DAMAGE TO OR DESTRUCTION OF PROPERTY, LOST
REVENUES, LOST PROFIT, OR LOSS OF PROSPECTIVE ECONOMIC ADVANTAGE, RESULTING
FROM PERFORMANCE OR FAILURE TO PERFORM UNDER THIS AGREEMENT.
16 Termination for Breach.
If either party (the "Defaulting Party") breaches any of its duties or
obligations under this Agreement, and such breach continues for thirty days
(ten days regarding failure to pay amounts due) after written notice of such
default from the other party, then the other party may terminate this Agreement
at any time thereafter, effective immediately upon written notice of
termination to the Defaulting Party, without prejudice to any other rights or
remedies the non-defaulting party may have. Upon notice of such termination,
the Defaulting Party will return immediately to the non-defaulting party any
and all confidential or proprietary information, programs, materials, or other
data, and any copies thereof, in the possession or control of the Defaulting
Party.
17 Force Majeure, Delay.
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CONFIDENTIAL TREATMENT 20
REQUESTED BY GALILEO
INTERNATIONAL, INC.
Neither party will be responsible for delays in performance caused by
acts of God or governmental authority, strikes or labor disputes, fires or
other loss of manufacturing facilities, breach by suppliers of supply
agreements, or any other cause beyond the reasonable control of that party.
18 Indemnification.
Each party (the "Indemnitor") will indemnify the other party, its
officers, employees, and agents (collectively "Indemnitees") against and hold
each Indemnitee harmless from all claims, suits, judgments, losses, damages,
fines or costs (including reasonable legal fees and expenses) resulting from
any claim, suit, or demand by any third party for injuries to or deaths of
persons or loss of or damage to property arising out of the Indemnitor's
performance or, willful misconduct of the Indemnitor its employees, officers,
or agents, in connection with the Indemnitor's performance of this Agreement,
except to the extent caused by the negligence of any Indemnitee. The
Indemnitor's obligations under this paragraph will survive the termination of
this Agreement.
19 Guarantee of Performance.
If either party (the "Insolvent Party") becomes insolvent; if the
other party (the "Insecure Party") has evidence that the Insolvent Party is not
paying its bills when due without just cause; if a receiver of the Insolvent
Party's assets is appointed; if the Insolvent Party takes any step leading to
its cessation as a going concern; or if the Insolvent Party either ceases or
suspends operations for reasons other than a strike, then immediately upon
receipt of written notice from the Insecure Party the Insolvent Party will
provide adequate assurance, satisfactory to the Insecure Party, of the future
performance of this Agreement. If bankruptcy proceedings are commenced with
respect to the Insolvent Party, then the Insecure Party may suspend all further
performance of this Agreement until the Insolvent Party assumes or rejects this
Agreement pursuant to section 365 of the Bankruptcy Code or any similar or
successor provision. Any such suspension of further performance by the
Insecure Party pending the Insolvent Party's assumption or rejection will not
be a breach of this Agreement and will not affect the Insecure Party's right to
pursue or enforce any of its rights under this Agreement or otherwise
20 Third Party Rights.
Nothing contained in this Agreement establishes or creates, or is
intended or will be construed to establish or create, any right in or any duty
or obligation to any third party.
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CONFIDENTIAL TREATMENT 21
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INTERNATIONAL, INC.
21 Assignment.
United may assign or transfer this Agreement or any rights granted or
provided for hereunder, in whole or in part, to any person or entity that is
controlled by United, otherwise United may not assign or transfer this
Agreement or any rights granted or provided for hereunder, in whole or in part,
without the written Agreement of GI-Inc. GI-Inc may assign or transfer this
Agreement or any rights granted or provided for hereunder, in whole or in part,
to any person or entity that is controlled by GI-Inc, otherwise GI-Inc may not
assign or transfer this Agreement or any rights granted or provided for
hereunder, in whole or in part, without the written Agreement of United.
22 Relationship of the Parties.
The relationship of the parties is that of principal and limited
agent. United may bind GI-Inc only as specifically provided in this
Agreement.
23 Severability.
If any provision of this Agreement is held to be invalid, illegal or
unenforceable in any respect, then the Agreement shall he construed to exclude
such provision and to be enforceable in all other respects, unless to do so
would prejudice the rights of either party or result in such a material change
as to cause performance by either party to be unreasonable.
24 Survival.
All provisions of this Agreement which by their terms survive
termination thereof will continue thereafter in full force and effect.
25 Governing Law.
This Agreement, and any dispute arising under or in connection with
this Agreement, including any action in tort, will be governed by the internal
laws of the State of Illinois. Any action brought to (i) preserve the status
quo pending arbitration or (ii) enforce an arbitration proceeding or decision
shall be brought in courts located within Xxxx County, Illinois, the parties
hereby consenting to personal jurisdiction and venue therein.
26 Notices.
All notices to either party under this Agreement must be in writing
and sent to the following addressee and at the following address:
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CONFIDENTIAL TREATMENT 22
REQUESTED BY GALILEO
INTERNATIONAL, INC.
for GI-Inc:
Galileo International Incorporated
Suite 400
0000 Xxxx Xxxxxxx Xxxx
Xxxxxxxx, Xxxxxxxx 00000
Attn: President
for United:
United Airlines Department WHQSS
0000 X. Xxxxxxxxx Xxxx
Xxx Xxxxx Xxxxxxxx, Xxxxxxxx 00000
Attn: Vice President and General Sales Manager
Notices will be deemed effective on the date received. Notices by
certified or registered mail (return receipt requested) will be deemed received
on the date shown on the return receipt. Notices sent by telex or facsimile
will be deemed received on the date transmitted if transmitted before 3:30 p.m.
time of recipient, otherwise on the next business day following transmission.
27 Headings.
The section headings and captions used in this Agreement are for
convenience of reference only and do not constitute a part of this Agreement
and will not be deemed to limit, characterize or in any way affect any
provision of this Agreement, and all provisions of this Agreement will be
enforced and construed as if no heading or caption had been used in this
Agreement.
28 Entirety of Agreement.
This Agreement including any Exhibits or attachments, supersedes all
prior oral or written representations or communications between the parties and
constitutes the entire understanding of the parties regarding the subject
matter of this Agreement. This Agreement may be modified only in a writing
signed by both parties.
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REQUESTED BY GALILEO
INTERNATIONAL, INC.
29 Counterparts.
This Agreement may be executed in one or more counterparts, each of
which shall be deemed an original, but all of which shall be considered one and
the same instrument.
IN WITNESS WHEREOF, the parties have agreed to and executed this
Agreement by their authorized representatives as of the Effective Date first
set forth above
GALILEO INTERNATIONAL, INC. UNITED AIR LINES, INC.
By: ______________________________ By: ______________________________
Name: ____________________________ Name: ____________________________
Title: ___________________________ Title: ___________________________
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CONFIDENTIAL TREATMENT
REQUESTED BY GALILEO
INTERNATIONAL, INC.
Appendix I
[INTENTIONALLY OMITTED -- CONFIDENTIAL TREATMENT REQUESTED]
[THREE PAGES OMITTED]
(APPENDIX I-1)
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Appendix II
[INTENTIONALLY OMITTED -- CONFIDENTIAL TREATMENT REQUESTED]
[FIVE PAGES OMITTED]
(APPENDIX II-1)
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CONFIDENTIAL TREATMENT
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Attachment A
Defined Terms
As used in this Agreement, including the Attachments, Exhibits and Schedules
hereto, the terms listed in this Attachment A have the meanings ascribed to
them. The use of a term in the singular that is defined herein in the plural
is understood in this Agreement to signify a single instance of such defined
matter.
"Accounting Services" means those travel agency accounting services that are
provided by GI-Inc to customer of GI-Inc.
"Active Support Personnel" means General Sales Personnel who will be dedicated
primarily (80 percent of work time) to providing Sales Services pursuant to
this Agreement.
"Administrative Support Personnel" means those General Sales Personnel who
perform primarily administrative or management functions in the provision of
Sales Services pursuant to this Agreement.
"Advance Credit" has the meaning ascribed to that term in Section 9 of Appendix
II.
"APR" means "Area of Primary Sales Responsibility" as defined herein.
"ARC" means Airlines Reporting Corporation.
"Area of Primary Sales Responsibility" means the exclusive geographic area of
primary sales responsibility assigned to United as described in Exhibit A
hereto and as such geographic area may be amended from time to time in
accordance with the provisions of this Agreement.
"Assigned Subscribers" means (i) all NTP Subscribers within the APR and (ii)
the Designated Subscribers, but excluding the Excluded Subscribers.
"Base Compensation" has the meaning ascribed to that term in Section 6 of
Appendix II and, in the event that there is a Carryover Base Compensation,
means such Carryover Base Compensation.
"BSP" means an entity, including, without limitation, IATA, that performs
accreditation, revenue reporting and clearing functions such as those performed
by ARC.
(ATTACHMENT A-1)
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CONFIDENTIAL TREATMENT
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"Cancelled Deal" has the meaning ascribed to that term in Section 5.2 above.
"Carryover Base Compensation" has the meaning ascribed to that term in Section
4.2 of Appendix II.
"Carryover FA Budget" has the meaning ascribed to that term in Section 4.2 of
Appendix II.
"Carryover Plan" has the meaning ascribed to that term in Section 4.2 of
Appendix II.
"Carryover Revenue Goal" has the meaning ascribed to that term in Section 4.2
of Appendix II.
"Commitment Review Procedure" has the meaning ascribed to that term in Section
5.2 above.
"Corporate Direct System" means a computerized travel reservations system that
is integrated with desktop travel management software including, for example,
travel policy enforcement, expense management, and management reporting
functionality and is (i) selected by a CTMS Customer for use by its employees,
or (ii) selected for use by a CTMS Agent retained by a CTMS Customer to service
the travel planning and management requirements of such CTMS Customer.
"CRS Industry" means the group of business entities who provide products and
services alike to the products and services of GI-Inc.
"CTMS Agent" means a Travel Agent, NTP Subscriber, service bureau, or other
person with whom a CTMS Customer has an agreement pursuant to which the CTMS
Agent performs services related to the use of a CTMS and other aspects of that
CTMS Customer's travel planning and travel management requirements.
"CTMS Customer" means a corporation, partnership, or other person who is an
existing or a potential purchaser of CTMS Services from GI-Inc.
"CTMS Form Agreement" means a Form Agreement that relates to CTMS Services.
"CTMS Sales Services" has the meaning ascribed to that term in Section 4.3
above.
"CTMS Services" means any portion of a Corporate Direct System provided by
GI-Inc, whether itself, or through an arrangement or arrangements between
GI-Inc and a third party or third parties.
(ATTACHMENT A-2)
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CONFIDENTIAL TREATMENT
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INTERNATIONAL, INC.
"CTMS" means a CTMS Service.
"Designated Subscribers" means those NTP Subscribers listed on Exhibit C hereto
and as amended pursuant to this Agreement.
"Dedicated Personnel" means General Sales Personnel of at least Account
Executive level who will be dedicated full-time (100 percent of work time) to
the provision of Sales Services pursuant to this Agreement.
"Discontinued Multinational Account" has the meaning ascribed to that term in
Section 2.1.3 above.
"Discontinued Service Notice" has the meaning ascribed to that term in Section
5.1 above.
"Dispute" means any dispute, disagreement, claim, or controversy arising in
connection with or relating to this Agreement, or the validity, interpretation,
performance, breach, or termination of this Agreement, including any claim of
breach of representation or warranty or of non-performance.
"Dispute Resolution Procedure" means the procedure described in Attachment B
hereto.
"Dispute Summary" means, with respect to a Dispute and with respect to the
party to the Dispute who shall prepare a Dispute Summary, a written declaration
presenting (i) a statement expressing the issue(s) in Dispute, (ii) facts
relevant to the understanding of the issue(s) in Dispute, and (iii) a statement
expressing the resolution of the Dispute that is sought by the party who
prepares the Dispute Summary.
"Excluded Subscribers" means those NTP Subscribers listed on Exhibit B pursuant
to this Agreement.
"FAA Factor" means, with respect to the Carryover Plan year in question, the
change, expressed as a percentage, in forecast domestic revenue passenger
enplanements for that Carryover Plan year versus the immediately preceding
year, where "forecast domestic revenue passenger enplanements" shall be as
provided in the then-current (as of the time the Carryover Plan is created)
"FAA Aviation Forecasts" issued by the U.S. Department of Transportation,
Federal Aviation Administration, Office of Aviation Policy and Plans.
"Financial Assistance" means the provision by GI-Inc, and at GI-Inc's expense,
to any one or more of (i) the Assigned Subscribers, (ii) CTMS Customers, and
(iii) CTMS Agents, of any
(ATTACHMENT A-3)
34
CONFIDENTIAL TREATMENT
REQUESTED BY GALILEO
INTERNATIONAL, INC.
one or more of: (a) cash payments; (b) indemnification payments; (c) revenue
sharing; (d) booking fee rebates; (e) lease fee waivers; (f) license fee
waivers; (g) productivity or efficiency fee waivers; (h) airline tickets or
other airline, car or hotel perquisites; (i) computer or other hardware; and (j)
other benefits.
"FA Budget" means the amount of Financial Assistance established in accordance
with the provisions of Section 3 of Appendix II and, in the event that there is
a Carryover FA Budget, means such Carryover FA Budget.
"Form Agreements" has the meaning ascribed to that term in Section 5.2 above.
"Galileo Board" means the Board of Directors of GI-Inc.
"Galileo Services" means, collectively, Reservations Services and Accounting
Services, as provided by GI-Inc in the APR, excluding CTMS Services.
"General Sales Personnel" means regular, full-time employees of United who
either are in training for or are actively engaged in the sale of air
transportation on United, or other persons as may be agreed by GI-Inc and
United, including Administrative Support Personnel as provided above, but
excluding employees of United engaged primarily in administrative or management
positions that supervise sale planning or implementation policies or processes
of United.
"GI-Inc Executive" has the meaning ascribed to that term in Section 3.1 above.
"GI-Inc Lead" has the meaning ascribed to that term in Section 4.2 above.
"GI-Inc Support" has the meaning ascribed to that term in Section 5.2 above.
"Guaranteed Compensation" has the meaning ascribed to that term in Section 7 of
Appendix II.
"Headquarters" means, with respect to the corporation or partnership in
question, the city or place in which that corporation or partnership maintains
its principal offices.
"HOL Flow" means, with respect to an individual NTP Subscriber, the annual
sales of air transportation revenue, as measured by ARC and BSPS, for all
locations of that NTP Subscriber.
"IATA" means the International Air Transport Association.
(ATTACHMENT A-4)
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CONFIDENTIAL TREATMENT
REQUESTED BY GALILEO
INTERNATIONAL, INC.
"Independent Directors" means the members of the Galileo Board who are neither
nominated by an airline owner of GI-Inc or are members of the executive
management of GI-Inc.
"Interest Rate" means the mathematical average of the prevailing
dollar-denominated 30 day and 90 day London Interbank Offered Rates (LIBOR), as
reported in the Wall Street journal for a specified business day, plus 200
basis points.
"Level One Bonus" has the meaning ascribed to that term in Section 8 of
Appendix II.
"Level Two Bonus" has the meaning ascribed to that term in Section 8 of
Appendix II.
"Material Change" has the meaning ascribed to that term in Section 5 of
Appendix II.
"Multinational Accounts" means (i) those Designated Subscribers listed under
"(A) Multinational Accounts" on Exhibit C hereto, and (ii) any other NTP
Subscriber who may become a "Multinational Account" as provided in Section
2.1.3 above.
"Multinational Procedure" has the meaning ascribed to that term in Section 4.2
above.
"Multinational Sales Services" has the meaning ascribed to that term in Section
4.2 above.
"National Accounts" means those Designated Subscribers listed under "(B)
National Accounts" on Exhibit C hereto.
"Negotiation Range" has the meaning ascribed to that term in Section 5.2 above.
"Neutral Travel Provider" means any Travel Agent that sells the products and
services of Vendors and holds itself out as a neutral source of information
regarding Vendors and their services or products.
"New Service" has the meaning ascribed to such term in Section 5.4 above.
"Non-Competition Agreement" means the Amended and Restated Non-Competition
Agreement, dated as of _____________ ___, 1997, among GI-Inc, United Air Lines,
Inc., UAL Corporation and Covia Corporation.
"Non-Vendor Revenue" means all revenue received by GI-Inc from NTP Subscribers,
CTMS Customers, CTMS Agents, and other persons and including, without
limitation, lease and license payments, install/deinstall charges, variable
charges (including but not limited to
(ATTACHMENT A-5)
36
CONFIDENTIAL TREATMENT
REQUESTED BY GALILEO
INTERNATIONAL, INC.
charges for tickets, itineraries and invoice documents), and backroom lease and
license fees, net of discounts, but not including Vendor Revenue.
"NTP" means Neutral Travel Provider, as defined herein.
"NTP Form Agreement" means a Form Agreement that relates to Galileo Services,
but excluding CTMS Services.
"NTP Sales Services" has the meaning ascribed to that term in Section 4.1
above.
"NTP Subscriber" means a Neutral Travel Provider who is an existing or a
potential purchaser of Galileo Services from GI-Inc.
"OPS" means United's Organizational Pay Summary system or any replacement
system that United may use, in United's sole discretion, and which is a
proprietary system that tracks United PMEs.
"Other Agent" has the meaning ascribed to that term in Section 2.4 above.
"Performance Compensation" has the meaning ascribed to that term in Section 7
of Appendix II.
"PME" means Paid Manpower Equivalent, which is commonly used in United's
business practices as a measure of average employee headcount for a the period
of time in question.
"Reporting Number" means an account number issued by the Airline Reporting
Corporation or by the International Air Transport Association, or both, to an
individual or entity for the purpose of authorizing such individual or entity
to operate as a travel agency.
"Reservations Services" means the computerized display, reservation, ticketing,
or sale of the services or products of Vendors including the availability and
price thereof, as generated by GI-Inc to any person other than Vendors.
"Revenue Goal" has the meaning ascribed to that term in Section 2 of Appendix
II.
"Sales Services" means, collectively, NTP Sales Services, Multinational Sales
Services, and CTMS Sales Services.
(ATTACHMENT A-6)
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CONFIDENTIAL TREATMENT
REQUESTED BY GALILEO
INTERNATIONAL, INC.
"Sales Force" means, collectively, the Active Support Personnel, Dedicated
Support Personnel and General Sales Personnel.
"Senior Review Committee" means a committee consisting of GI-Inc's President
and United's Senior Vice President - North America.
"Support Services" has the meaning ascribed to that term in Section 4.4 above.
"Tech Office" means a technical support center (at times referred to
colloquially as a "TN" office) operated and staffed by GI-Inc with personnel
proficient in all technical aspects of the use by end-users of GI-Inc products
and services.
"Territorial Reassignment" has the meaning ascribed to that term in Section 2.4
above.
"Territory" means, collectively, the United States of America together with its
territories and protectorates, and the Republic of Mexico.
"Total Revenue" means the sum of Non-Vendor Revenue and Vendor Revenue, with
respect to the APR plus such revenue generated from Designated Subscribers less
such revenue generated from Excluded Subscribers, provided that any such
revenue generated from the location of an Excluded Subscriber in the calendar
year in which such location commences purchasing Galileo Services shall be
included in the Total Revenue only for the sales representative who was
responsible for such sale of Galileo Services.
"Training Materials" has the meaning ascribed to that term in Section 4.7.3.3
above.
"Travel Agent" means an individual or entity, that has been assigned a
Reporting Number.
"United Executive" has the meaning ascribed to that term in Section 3.2 above.
"United Group Products and Services" means with respect to United and any
carrier that uses United's airline designator code in the display of certain
designated flights (collectively, the "group carriers") the schedule, seat
availability, and price thereof of the group carriers, including, without
limitation, air and/or non-air travel packages that may include ancillary air
segments on non-group-carrier airlines.
"United Lead" has the meaning ascribed to that term in Section 4.2 above.
"US Deal" has the meaning ascribed to that term in Section 4.2 above.
(ATTACHMENT A-7)
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CONFIDENTIAL TREATMENT
REQUESTED BY GALILEO
INTERNATIONAL, INC.
"US Dollar" means the lawful currency of the United States of America.
"Vendor" means a vendor of travel-related services, such as an airline, hotel,
or rental car company, tour package, cruise operator, or travel insurance
company, that has purchased or subscribed for Reservations Services.
"Vendor Revenue" means all revenue received by GI-Inc from Vendors with respect
to booking fees and other service charges or fees as a result of bookings and
other transactions for which GI-Inc charges a fee to Vendors, which such
bookings and other transactions are generated by NTP Subscribers, CTMS
Customers, CTMS Agents, and other persons.
(ATTACHMENT A-8)
39
CONFIDENTIAL TREATMENT
REQUESTED BY GALILEO
INTERNATIONAL, INC.
Attachment B
Dispute Resolution Procedure
1. General Procedure.
Except as otherwise stated in the Agreement, the parties hereto shall
resolve all Disputes in accordance with this procedure:
(a) Each party shall instruct its appropriate representative to promptly
negotiate in good faith with the other party's appropriate
representative to resolve the Dispute. The GI-Inc Executive shall be
the representative of GI-Inc. The United Executive shall be the
representative of United.
(b) if the representatives do not resolve the Dispute within ten business
days (or such longer period as the Representatives may agree) after
the date of referral of the Dispute to them, the representative of
each party will prepare a Dispute Summary with respect to that party's
position in the Dispute. The Dispute shall be referred (by either or
both of the representatives) to the Senior Review Committee for
resolution on the basis of the Dispute Summaries prepared by each
party.
(c) If the Senior Review Committee does not resolve the Dispute within ten
business days (or such longer period as that Committee may agree) from
the date of referral to it, either party may submit the Dispute to
binding arbitration in accordance with Section 2 of this Attachment.
2. Arbitration Procedure
The Arbitration Procedure shall be the "baseball" arbitration procedure
provided in Section 5.04 of the Amended and Restated Computer Services
Agreement between United and GI-Inc, modified as necessary with respect to
defined terms in this Agreement.
(ATTACHMENT B-1)
40
CONFIDENTIAL TREATMENT
REQUESTED BY GALILEO
INTERNATIONAL, INC.
Exhibit A
[INTENTIONALLY OMITTED -- CONFIDENTIAL TREATMENT REQUESTED]
(EXHIBIT A-1)
41
CONFIDENTIAL TREATMENT
REQUESTED BY GALILEO
INTERNATIONAL, INC.
Exhibit B
[INTENTIONALLY OMITTED -- CONFIDENTIAL TREATMENT REQUESTED]
(EXHIBIT B-1)
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CONFIDENTIAL TREATMENT
REQUESTED BY GALILEO
INTERNATIONAL, INC.
Exhibit C
[INTENTIONALLY OMITTED -- CONFIDENTIAL TREATMENT REQUESTED]
(EXHIBIT C-1)
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CONFIDENTIAL TREATMENT
REQUESTED BY GALILEO
INTERNATIONAL, INC.
Exhibit D
Sales Representative Reports
1) Staffing Report. A quarterly written advice of staffing levels.
2) Account Activity Reports setting forth: Gains (signed
contracts/OA's); Losses, Renewals; Changes/Updates to target lists -
due on last day of each month.
3) Redistricting Reports and Administrative Files. On GI-Inc's request,
contains account alignments and assignments.
(EXHIBIT D-1)
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CONFIDENTIAL TREATMENT
REQUESTED BY GALILEO
INTERNATIONAL, INC.
Exhibit E
Certain Territories
[This Exhibit E is to contain a list of territories for which Galileo has
granted exclusive distribution rights for products to a third party and in
which United may not sell CTMS Services so long as the exclusivity provision(s)
of Galileo's agreement with that third party is in effect.]
(EXHIBIT E-1)
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CONFIDENTIAL TREATMENT
REQUESTED BY GALILEO
INTERNATIONAL, INC.
Schedule 1
[INTENTIONALLY OMITTED -- CONFIDENTIAL TREATMENT REQUESTED]
(Schedule 1-1)
