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EXHIBIT 10.24
HCC PARTICIPANT AGREEMENT
This Agreement (the "Agreement") is entered into by and between THE HOTEL
CLEARING CORPORATION, a Delaware corporation ("HCC"), and LA QUINTA INNS, INC.
("Participant"), to be effective the 29 day of May 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;
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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, Participant shall pay HCC a transaction fee
("HCC Transaction Fee") 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 [*] but less than [*].
(b) For each Commissionable Reservation in excess of [*]
processed each month, [*] a transaction fee each month
(the [*]) as follows:
For any month wherein the total of Commissionable
Reservations processed are in excess of [*] but less
than [*] a Participant Transaction Fee of [*] for each
Commissionable Reservation between [*] and [*];
For any month wherein the total of Commissionable
Reservations processed are in excess of [*] but less
than [*] a Participant Transaction Fee of [*] for each
Commissionable Reservation between [*] and [*];
For any month wherein the total of Commissionable
Reservations processed are in excess of [*] and less
than [*], a Participant Transaction Fee of [*] for each
Commissionable Reservation between [*] and [*]; and
For any month wherein the total of Commissionable
Reservations processed are in excess of [*] a
Participant Transaction Fee of [*] for each
Commissionable Reservation in excess of [*].
*Confidential Treatment Requested
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Provided however, notwithstanding the preceding provisions of
this 3.1(b), the total Participant Transaction Fee paid per
month shall not exceed an amount equal to [*] per Commissionable
Reservation 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 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) [*] based on [*] for the period
covered by such billing statements, (iv) any [*] of the [*]
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 [*] 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.
*Confidential Treatment Requested
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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 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
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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.
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 attorneys 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
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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).
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 Conseguential 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
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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.
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. 0000 Xxxxxxxxx
Xxxxx 0000 Xxxxx 000
Xxxxxx, XX 00000 Xxx Xxxxxxx, XX 00000
Attention: Xxxx X. Xxxxx, III Attn: Xxxxxx Xxxxx
If by telecopy/facsimile to: 210/616-7649
528-5675
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 LA QUINTA INNS, INC.
By: /s/ [ILLEGIBLE] By: /s/ [ILLEGIBLE]
--------------------------- ---------------------------
Its: V.P. SALES Its: SR VP & CFO
-------------------------- --------------------------
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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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