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EXHIBIT 10.59
HCC PARTICIPANT AGREEMENT
This Agreement (the "Agreement") is entered into by and between THE
HOTEL CLEARING CORPORATION, a Delaware corporation ("HCC"), and BEST WESTERN
INTERNATIONAL, INC. ("Participant"), to be effective the 30 day of July, 1997.
SECTION 1. DEFINITIONS
1.1 For purposes of this Agreement, the following definitions shall
apply:
(i) Commissionable Reservations. Commissionable Reservations
within a particular time period equals the number of
reservations (both voice and electronic) processed through
the HCC System within such time period that are identified
as "commissionable" or "partially commissionable" on the
transaction records provided by Participant to HCC and for
which a travel agent commission is paid pursuant to this
Agreement.
(ii) HCC System. The HCC System is HCC's automated
clearinghouse system to provide for the coordination of
reservation information, transfer of hotel reservation
commissions and ancillary services to Travel Agents and
Participating Entities.
(iii) Participating Entity. A Participating Entity is an
operator of a hotel reservation system that has executed a
HCC Participant Agreement.
(iv) HCC Travel Agents. An HCC Travel Agent is a travel agency
who has executed an HCC Subscriber Agreement. A list of
current HCC Travel Agents will be periodically provided by
HCC to Participant.
(v) HCC Travel Agent Commissions. HCC Travel Agent
Commissions are the commissions paid by Participant to HCC
Travel Agents pursuant to this Agreement. HCC Travel
Agent Commissions will be based on commission rates
provided by Participant to HCC.
SECTION 2. THE HCC SYSTEM
2.1 Duties of HCC. HCC will provide and operate the HCC System for
the use and benefit of Participant, its franchisees and
affiliates, and other Participating Entities. HCC will provide
all reasonable and necessary technical support, hardware and
software, except as otherwise provided herein, and modifications
to the HCC System to provide clearinghouse services to
Participant and its franchisees and affiliates as described
below. Upon compliance with the terms of this Agreement by
Participant, its franchisees and affiliates, and subject to
Section 5 hereof, HCC will provide the following clearinghouse
services to Participant and its franchisees and affiliates:
(i) identify Participant to travel agents as being a HCC
System Participating Entity;
INFORMATION CONTAINED IN THIS AGREEMENT HAS BEEN OMITTED SUBJECT TO A
CONFIDENTIAL TREATMENT REQUEST AND HAS BEEN FILED SEPERATELY WITH THE S.E.C.
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(ii) provide billing statements for HCC Travel Agent
Commissions, Transaction Fees (as defined below) and other
fees, costs and expenses to Participant no later than the
fifteenth (15th) business day after the end of each month
as provided in Section 3 below;
(iii) distribute collected HCC Travel Agent Commissions received
from Participant and its affiliates and franchisees to the
appropriate HCC Travel Agents as set forth in the HCC
Travel Agent Commission information provided by
Participant;
(iv) provide no later than the fifteenth (15th) business day of
each month reports to Participant and HCC Travel Agents
reflecting HCC Travel Agents' reservation transactions
with Participant and HCC Travel Agent Commissions owed
based upon the data provided to HCC by Participant and its
affiliates and franchisees who are participating in the
HCC System; and
(v) provide telephone customer support services from 8:00 a.m.
to 5:00 p.m., U.S. Central time, Monday through Friday,
exclusive of legal holidays.
The procedures of the HCC System are subject to changes for enhancements from
time to time as determined by HCC, provided that no such changes will have a
significant adverse impact on the clearinghouse services described above.
2.2 Duties of Participant. Participant shall diligently and in good
faith do the following:
(i) Cooperate reasonably with HCC personnel with respect to
the implementation of the HCC System between HCC Travel
Agents and Participant and its affiliates and
franchisees;
(ii) Provide HCC with all that is reasonably required by HCC to
process all reservations (including all reservations made
electronically or by voice, through the use of a central
reservation "800" phone number, inclusive of no-shows,
cancellations and non-commissionable transactions) made by
HCC Travel Agents with Participant and, subject to
2.2(iv), its affiliates and franchisees no less often than
on a semi-monthly basis such data being complete and
accurate to the best of Participant's knowledge and
ability and inclusive of all of the information to permit
HCC to provide the clearinghouse services described in
Section 2.1 hereof and, without limitation, being such
information as set forth on Exhibit A hereof; and permit
and authorize HCC to obtain and use such data concerning
such reservations made with Participant and, subject to
2.2(iv), its affiliates and franchisees except such data
designated as confidential pursuant to Section 7 hereof.
The foregoing shall be subject to receipt by Participant
from HCC of the instructions, specifications, directions,
information, assistance, and cooperation reasonably
required by Participant to provide the foregoing.
(iii) Pay, pursuant to this Agreement, all Travel Agent
Commissions reported to HCC for processing pursuant to
this Agreement within two (2) business days of receipt of
the billing statement described in Section 3.5 hereof;
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(iv) Use its reasonable efforts to cause each of its
franchisees and affiliates to fully and timely participate
in the HCC System pursuant to this Agreement;
(vi) Permit HCC to use its name as an entity participating in
the HCC System.
2.3 Modification or Enhancement of the HCC System or Participant
System. HCC may in its sole discretion modify the operation or
enhance the capability of the HCC System, and Participant agrees
to cooperate reasonably with HCC to the extent reasonably
necessary to effectuate modifications and enhancements of the HCC
System. If Participant determines that such modification or
enhancement is likely to require Participant to make significant
modifications to its central reservation system (any such
modifications to be at Participant's sole expense), HCC will
provide at least ninety (90) days' prior notice to Participant of
such modification or enhancement and Participant may, at its
option, terminate this Agreement upon sixty (60) days notice to
HCC.
SECTION 3. FEES, COSTS, AND PAYMENTS
3.1 Fees for Processing HCC Travel Agent Commissions.
(a) For the first * Commissionable Reservations processed
each month, * shall pay * each month of U.S. * for
each such Commissionable Reservation processed. For any
month wherein the total of Commissionable Reservations is
greater than * but less than * shall be due from
either party for each such Commissionable Reservation over
* .
(b) For each Commissionable Reservation in excess of *
processed each month, * each month (the "Participant
Transaction Fee") as follows:
For any month wherein the total of Commissionable
Reservations processed are * , a * of * for
each Commissionable Reservation between * ;
For any month wherein the total of Commissionable
Reservations processed are * , a * of * each
Commissionable Reservation between * ;
For any month wherein the total of Commissionable
Reservations processed are * , a * of * for
each Commissionable Reservation between * ; and
For any month wherein the total of Commissionable
Reservations processed are in * , a * of * for
each Commissionable Reservation in excess of * .
Provided however, notwithstanding the preceding provisions of
this 3.2(b), the total Participant Transaction Fee paid per month
shall not exceed an amount equal to * in the aggregate.
3.2 Commission Payments. HCC shall pay HCC Travel Agent Commissions
in the travel agent's local currency or the currency requested by
the travel agency. HCC shall be responsible for
* CONFIDENTIAL TREATMENT REQUESTED
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complying with laws and regulations relating to the treatment of
unclaimed property (sometimes referred to as "escheatment" laws)
resulting from checks issued to travel agents under this
Agreement. The parties will jointly establish mutually
acceptable procedures to be implemented by HCC in order to comply
with such laws and regulations. The parties will meet to
establish such procedures by no later than thirty (30) days after
the effective date, and will cooperate and work diligently with
one another in order to finalize same as promptly as practical.
3.3 Disputed Commissions. HCC will provide Participant and HCC
Travel Agents with periodic reports indicated under Section
2.1(iv) that will indicate any exceptions to HCC Travel Agent
Commissions, based on discrepancies between information given HCC
by Participant compared to other information available to HCC.
With respect to all exceptions as to which Participant provides
supporting documentation, HCC will forward such documentation to
the appropriate HCC Travel Agent(s), and the HCC Travel Agents
involved may pursue such dispute directly with Participant('s)
franchisees, but HCC will not have any liability to either
Participant or any travel agent (HCC or non-HCC) with respect to
the resolution of any disputed commission. No dispute concerning
any travel agent commissions will in any way affect or reduce the
obligations of Participant to (i) timely pay all other HCC Travel
Agent Commissions reported to HCC for processing and (ii) timely
pay to HCC all Transaction Fees and other fees, costs and
additional expenses owed by Participant under this Agreement; nor
shall any such dispute in any way affect or reduce the
obligations of HCC to timely pay Participant all Participant
Transaction Fees due under this Agreement.
3.4 Billing Statements. Based upon the information provided HCC by
or with respect to Participant pursuant to Section 2.2, above,
HCC will provide Participant a monthly billing statement
detailing (i) HCC Travel Agent Commissions to be paid by
Participant for the period covered by such billing statement;
(ii) HCC Transaction Fees to be paid by Participant, based on
Commissionable Reservations for the period covered by such
billing statement; (iii) * to be paid by HCC, based on
Commissionable Reservations for the period covered by such
billing statements, (iv) * which is due and (v) all other
costs and fees owed by Participant pursuant to this Agreement.
All fees and costs shall be paid in U.S. dollars.
SECTION 4. TERM
4.1 Term of Agreement. The initial term of this Agreement shall
begin on the effective date set forth at the beginning of this
Agreement and, unless earlier terminated pursuant to the
provisions of this Agreement, shall expire on the last day of the
twenty fourth (24th) month after the date of this Agreement.
However, this Agreement will be automatically renewed and
extended for additional twelve (12) month periods unless, at
least sixty (60) days prior to the expiration of the initial term
of this Agreement or any additional twelve (12) month period,
either party provides written notice to the other of its decision
not to renew and extend.
SECTION 5. TERMINATION
5.1 Termination Upon Default. Upon the occurrence of an Event of
Default (as defined below) by either party and the failure of
such party to cure such default after notice and opportunity to
cure as provided by Section 6.3 below, the nondefaulting party
may terminate this Agreement at any time.
5.2 Suspension of Status. Upon the occurrence of an Event of Default
by Participant and the failure of Participant to cure such
default after notice and opportunity to cure as provided by
Section 6.3 below, then, if HCC does not terminate this Agreement
under Section 5.1, until
* CONFIDENTIAL TREATMENT REQUESTED
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such time as such Event of Default is cured HCC shall have the
right to suspend the status of Participant as a Participating
Entity and to notify all HCC Travel Agents of such default and
suspension through central reservation systems or otherwise.
SECTION 6. DEFAULT
6.1 Events of Default. Subject to Section 6.2 below, any one of the
following will be considered an Event of Default:
(i) The failure of either party to pay any amount due
hereunder within the time required;
(ii) The failure of Participant or HCC to satisfy the
obligations set forth in this Agreement;
(iii) The refusal or failure of either party to perform
diligently and in good faith each and every material
provision of this Agreement;
(iv) If either HCC or Participant (the "Defaulting Party")
becomes insolvent, takes any step leading to its cessation
as a going concern, or ceases business operations for
reasons other than a strike and other than assignment as
allowed by this Agreement, then the other party (the
"Insecure Party") may immediately terminate this Agreement
upon written notice to the other party unless the
Defaulting Party immediately gives the Insecure Party
adequate assurance of the future performance of this
Agreement. If bankruptcy proceedings are commenced with
respect to the Defaulting Party, and if this Agreement has
not otherwise terminated, then the Insecure Party may
suspend all further performance of this Agreement until
the Defaulting Party assumes or rejects this Agreement
pursuant to Section 365 of the Bankruptcy Code or any
similar or successor provision. Any such suspension of
further performance by the Insecure Party pending the
Defaulting Party's assumption or rejection will not be a
breach of this Agreement.
Any such Event of Default shall not relieve the defaulting party from
any of its obligations hereunder, and the non-defaulting party shall,
except as provided in this Agreement, be entitled to whatever remedies
at law or in equity are available to it.
6.2 Force Majeure. It will not constitute an Event of Default if
such event listed in Section 6.1 is caused by or results from
acts of God, fire, war, civil unrest, accident, power
fluctuations or outages, telecommunication fluctuations, outages
or delays, utility failures, mechanical defects, or other events
beyond the control of the defaulting party. However, if any such
occurrence results in any of the events described in Section 6.1,
and the same continues for more than thirty (30) consecutive
days, either party may terminate this Agreement by providing
notice as required herein.
6.3 Cure Period. Upon the occurrence of an Event of Default, the
non-defaulting party will give written notice to the defaulting
party specifying the alleged default. In the case of a monetary
default by either party, the defaulting party will only be
allowed to cure such default within two (2) business days after
receipt of such notice, by delivering that amount owed to HCC in
good funds into the non-defaulting party's bank account. In all
other instances, the defaulting party will be entitled to fifteen
(15) days from receipt of notice within which to cure the
default.
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SECTION 7. CONFIDENTIALITY
7.1 Proprietary Information. During the term of this Agreement, it
is acknowledged by Participant and HCC that each may receive
confidential and proprietary information that is the property of
the other party. All such confidential and proprietary
information will be marked or otherwise identified as such and
will be treated as confidential and proprietary subject only to
disclosure where required by law. Such designation may be
removed by each party making the designation. Participant
acknowledges that it will have no access to and will not use the
HCC System or related property, other than as specifically
provided for in this Agreement, and that such system and related
property is confidential and proprietary property of HCC. Any
use of HCC service marks or trade names by Participant is subject
to prior written approval of HCC, provided, that Participant may
describe the HCC System contemplated by this Agreement in its
franchise offering circular and other materials as required by
state or federal law. Unless otherwise provided herein, any use
of Participant's service marks or trade names by HCC is subject
to prior written approval of Participant. The provisions of this
Section 7.1 will remain binding and in force and effect as long
as such information remains confidential (other than by breach of
this Agreement), notwithstanding the expiration or termination of
this Agreement at any time. Except as is necessary in connection
with the performance of this Agreement and HCC's business,
information regarding the reservations and other transactions of
Participant processed by HCC shall be treated as confidential
whether or not so marked or otherwise identified as confidential.
SECTION 8. INDEMNIFICATION
8.1 Indemnification in the Event of Certain Losses. Participant
agrees to indemnify and hold harmless HCC and HCC's affiliates,
directors, officers, employees and stockholders, from and against
any losses, claims, liabilities, damages or expenses (including
reasonable attorney's fees) occurring as a result of or arising
out of a material breach of this Agreement on account of
Participant's (or its franchisees) fault, to the extent not
caused by the fault of HCC ("HCC's Losses"). HCC agrees to
indemnify and hold harmless Participant, and Participant's
affiliates, directors, officers, employees and stockholders, from
and against any losses, claims, liabilities, damages or expenses
(including reasonable attorney's fees) ("Participant's Losses")
occurring as a result of or arising out of a material breach of
this Agreement on account of HCC's fault to the extent not caused
by the fault of Participant. Promptly after receipt by an
indemnified party of notice of the commencement of any action or
the presentation or other assertion of any claim which could
result in any indemnification claim pursuant to this Section 8.1,
such indemnified party will give prompt notice thereof to the
indemnifying party and the indemnifying party will be entitled to
participate therein or, to the extent that it wishes, assume the
defense thereof with its own counsel. If the indemnifying party
elects to assume the defense of any such action or claim, the
indemnifying party shall not be liable to the indemnified party
for any fees of other counsel or other expenses subsequently
incurred by such indemnified party in connection with the defense
thereof, other than reasonable costs of investigation and
preparation, unless representation of both parties by the same
counsel would be inappropriate due to actual or potential
differing interests between them. The parties agree to cooperate
to the fullest extent possible in connection with any claim for
which indemnification is or may be sought under this Agreement.
Whether or not the indemnifying party elects to assume the
defense of any such action or claim, the indemnifying party shall
not be liable for any compromise or settlement of any such action
or claim effected without its consent (which shall not be
unreasonably withheld).
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SECTION 9. DISCLAIMER OF WARRANTIES
9.1 Waiver of Warranties. HCC WILL NOT BE RESPONSIBLE OR LIABLE FOR
ANY FALSIFICATIONS OR INACCURACIES IN THE DATA PROVIDED BY
PARTICIPANT OR THE INFORMATION PROCESSED BY OR THROUGH THE HCC
SYSTEM NOR WILL IT HAVE ANY LIABILITY FOR ANY ACT OR FAILURE TO
ACT WITH RESPECT TO THE DATA OR THE PAYMENT OF COMMISSIONS UNLESS
EXPRESSLY SET FORTH HEREIN. EXCEPT WITH RESPECT TO HCC'S GROSS
NEGLIGENCE OR WILLFUL MISCONDUCT, ALL WARRANTIES, EXPRESS OR
IMPLIED, STATUTORY OR OTHERWISE, INCLUDING, WITHOUT LIMITATION,
ANY WARRANTY OF FITNESS FOR A PARTICULAR PURPOSE,
MERCHANTABILITY, GOOD AND WORKMANLIKE PRODUCT OR SERVICE OR
OTHERWISE, ARE DISCLAIMED BY HCC AND WAIVED BY PARTICIPANT.
9.2 No Consequential Damages. Except with respect to the
indemnification provisions set forth in Section 8.1 hereof,
neither party will be liable to the other for any consequential
damages caused or resulting from any breach of this Agreement or
arising out of the performance of this Agreement, and each party
hereby expressly waives such damages.
SECTION 10. MISCELLANEOUS
10.1 Arbitration of Disputes. Any controversy or claim arising out of
or relating to this contract, or the breach thereof, will be
settled by arbitration in accordance with the Commercial
Arbitration Rules of the American Arbitration Association, and
judgment upon the award rendered by the arbitrators may be
entered in any court having jurisdiction thereof. There shall be
a panel of three arbitrators. Each party will select one
arbitrator within thirty (30) days of notice of the dispute, and
the two (2) arbitrators selected shall select a third neutral
arbitrator within thirty (30) days after the second arbitrator is
chosen. All reasonable and necessary costs and fees (including
attorney's fees) incurred in connection with the arbitration will
be borne by the losing party or assessed in the award as
otherwise deemed appropriate by the arbitrators. If the demand
for arbitration is initiated by Participant, venue of the
arbitration proceedings will be determined by HCC. If the demand
for arbitration is initiated by HCC, venue of the arbitration
proceedings will be determined by Participant.
10.2 Non-Exclusive Agreement. Each party acknowledges that this is
not an exclusive agreement with respect to reservations
commissions clearinghouse services and that each party may
contract with other parties providing same or similar services.
10.3 Status of Parties. This Agreement will not constitute a
partnership, joint venture or similar arrangement. The parties
hereto are separate and distinct entities independently
contracting with each other at arms length. HCC will not be
deemed by this Agreement to be granting a license to Participant
with respect to the HCC System or any software or service xxxx
related thereto, or otherwise, this being a contract for the use
and rendering of services only.
10.4 Assignment. This Agreement is not assignable by HCC or
Participant without the prior written consent of the non-
assigning party, and such consent shall not be unreasonably
withheld or delayed provided that Participant may assign this
Agreement to a wholly-owned subsidiary or in connection with the
sale of its reservation system or franchise system and either
party may assign this Agreement without consent in the event of a
merger, consolidation, or sale of substantially all of its
assets.
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10.5 Notices. All notices and other communications contemplated
hereby must be in writing (except in the case of electronically
transmitted data) and (a) personally delivered, (b) deposited in
the United States mail, first-class, registered or certified
mail, return receipt requested, with postage prepaid, (c) sent by
overnight courier service (for next business day delivery),
shipping prepaid, (d) sent by telecopy or facsimile with
confirmation of receipt to the number indicated, or (e)
transmitted directly to the recipient by electronic data
transmission pursuant to arrangements made between the parties.
Such notices and other communications (except in the case of
electronically transmitted data) shall be addressed as follows:
IF TO HCC: IF TO PARTICIPANT:
0000 Xxxxxx Xxxxx Xxxx.
Xxxxx 0000
Xxxxxx, XX 00000
Attention: Xxxx X. Xxxxx, III
If by telecopy/facsimile to:
000-000-0000
or such persons or addresses as any party may request by notice
duly given hereunder. Except as otherwise specified herein,
notices will be deemed given and received when received.
10.6 Controlling Law. This Agreement will be interpreted pursuant to
the laws of the State of Texas without reference to its conflict
of laws principles. Subject to the agreement to arbitrate and
the jurisdiction and venue provisions set forth in Section 10.1
hereof, any action brought relating to or arising out of this
Agreement must be brought in the state or federal courts situated
in the county and state of the residence or principal place of
business of the party against whom the action is brought (or any
of them, if more than one).
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10.7 Entire Agreement. This Agreement and the Exhibits attached
hereto constitute the entire agreement between HCC and
Participant with respect to the provision of services under the
HCC System and supersedes and replaces any and all other
agreements and representations, verbal or written, with respect
to the subject matter of this Agreement. There are no
representations, warranties or agreements made or relied upon by
either party with respect to the subject matter of this Agreement
that are not contained in this Agreement.
10.8 Successors and Assigns. This Agreement will be binding upon and
will inure to the benefit of the legal representatives,
successors and duly authorized assigns of each party whether
resulting from merger, acquisition, reorganization or assignment
pursuant to the terms hereof.
10.9 Confidentiality of the Agreement. The parties agree that the
terms and provisions of this Agreement will be kept confidential
and shall be disclosed only to those persons and entities as
required by law or as permitted by the other party hereto. The
parties may, however, disclose the existence of this Agreement to
any person or entity.
AGREED to as of the date first written above.
THE HOTEL CLEARING CORPORATION BEST WESTERN INTERNATIONAL, INC.
By: /s/ M. XXXXXXXX XXXX By: /s/ XXXX X. XXXXXXX
----------------------------- ------------------------------
M. Xxxxxxxx Xxxx Xxxx X. Xxxxxxx
Its: VP Sales Its: Vice President
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EXHIBIT A
Initial Information to be Provided by Participant to HCC
The fields in each commission record are the following:
-Record identifier required validated
-Chain record number required check for duplicates
-Chain/Brand code required validated
-Booking source required validated
-Property ID required validated
-PNR Number optional no checks
-Confirmation number required validated presence
-Cancellation number optional no checks
-Corporate ID number optional no checks
-Subscriber IATA number required validated HCC User
-Group/Guest last name required validated presence
-Group/Guest first name optional no checks
-Status code required validated
-Reason code optional if present, validate
-Arrival date required validated, no future
-Departure date required validated, no future
-Number of nights required validated presence
-Number of rooms required validated presence
-Commissionable revenue required validated, no neg.
-Gross Commission required validated, no neg.
-Adjustment amount required validated presence
-Net Commission due required validate computation
-Currency code required validated
-Comments optional no checks
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