Exhibit 10.26


MASTER SERVICES
AGREEMENT


 


This
Master Services Agreement (“Agreement”) is made as of March, ___, 2005 (“Effective
Date”), between Pegasus Solutions, Inc.
(“Pegasus”) and Cendant Travel Distribution
Services Group, Inc. (“Customer”).


 


In consideration of the
covenants and agreements set forth herein and other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the
parties agree as follows:


 


1.0  DEFINITIONS


 


1.1           All capitalized terms not otherwise
defined in this Agreement shall have the following meanings:


 


(a)           “Affiliate” means (i) any
entity that is now or hereafter owned, leased or managed by Customer that
provides hotel distribution services; or (ii) any entity that is controlled by
Customer with access to the Services.


2.0  SERVICES


 


2.1           Services.  Pursuant to a mutually agreed plan, schedule
of implementation and service level addendum, if applicable, and subject to the
performance by Customer of its duties set forth herein, during the term of this
Agreement, Pegasus will provide to Customer the services (“Services”) described
in the service schedules and applicable service level addendums (“Service
Schedules”) attached hereto and made a part of this Agreement.


 


2.2           Additional
Services.  Pegasus is not
obligated by this Agreement to provide any services to Customer other than the
Services.  Notwithstanding the foregoing,
if Pegasus introduces any additional products or services to any of its
customers in the future, Pegasus will promptly give notice to Customer of such
additional products or services and will, upon Customer’s request, provide
Customer with such products and services pursuant to an agreed upon schedule
and agreed upon pricing.  If Pegasus and
Customer execute a service schedule for additional services, such additional
services shall thereafter be deemed to be Services, and such service schedule
shall thereafter be deemed to be a Service Schedule, shall be made a part of
this Agreement and shall be subject to the terms and conditions contained
herein.  If Pegasus provides any services
to Customer pursuant to a work order, statement of work or similar document,
such document being executed by both Customer and Pegasus, which services are
not subject to a Service Schedule, such services shall be provided pursuant to
the terms and conditions of this Agreement and the contents of the governing
work order, statement of work or similar document, provided that if a conflict
exists between the terms and conditions of this Agreement and the contents of
the governing work order, statement of work or similar document, the terms and
conditions of this Agreement shall control.


 


 


 


3.0  GENERAL REQUIREMENTS


 


3.1           Cooperation.  Customer agrees (a) to use commercially
reasonable efforts to cooperate fully with and provide reasonable support for,
and cause each Affiliate to cooperate fully with and provide reasonable support
for, Pegasus personnel with respect to the implementation, maintenance and
delivery of the Services in accordance with the terms of this Agreement; (b) at
Customer’s sole expense, to procure, operate, maintain and manage (or cause
each Affiliate to procure, operate, maintain and manage) at each Affiliate’s
premises and Customer’s permitted facilities, if any, such hardware, software,
equipment and communications capabilities and lines as may be reasonably
necessary for Customer and each Affiliate to access and receive the Services  (and, to the extent that the parties agree
in writing that Pegasus will provide such communications capabilities and lines
to Customer and/or each Affiliate, to pay Pegasus for the same as mutually
agreed to in writing); and (c) that each party shall be solely responsible for
the performance of local and wide-area networks, dedicated leased data lines,
dial up lines, and all other communication interfaces and related equipment
used for any connections or interfaces required to perform its obligations
under this Agreement.


 


PORTIONS
OF THIS EXHIBIT MARKED BY AN (***) HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMMISSION


 


1

















 


3.2           Modifications
and Enhancements.


 


(a)           Pegasus reserves the right to modify
or enhance the Services, and related processes and procedures, at any time in
its sole discretion, provided that (i) no such modification or enhancement
affects the functionality of the Services in a material adverse manner, and
(ii) Pegasus provides Customer, at no charge to Customer, the same training, if
any, that is provided at no charge to its other customers receiving the same
modification or enhancement, but in no event less than the training provided at
no charge to customers receiving the same modification or enhancement; and
(iii) Customer has the right to terminate the Agreement if Customer determines
that such modification or enhancement affects the functionality of the Services
in a material adverse manner, or will result in additional cost to
Customer.  Customer agrees to cooperate
and will use commercially reasonable efforts to cause all Affiliates to
cooperate with Pegasus in connection with any modification or enhancement of
the Services.  Pegasus will provide
reasonable documentation relating to enhancements or modifications to the Services.  Pegasus will not be obligated to provide,
maintain or support any release or version of any Service other than the
then-current release or version of such Service or the release or version
immediately preceding the then-current release or version.


 


(b)           Pegasus will use commercially
reasonable efforts to implement each new release and version of each Service in
accordance with a mutually agreed implementation schedule and shall provide
Customer with reasonable notice in the event of any delay in the implementation
schedule; provided, however, Customer may not delay implementation of any new
release or version of a Service beyond the release date of any subsequent
release or version of such Service without Pegasus’ consent, which shall not be
unreasonably withheld.  Pegasus will
provide Customer with thirty (30) days notice of any reasonable changes (due to
upgrades, enhancements or discontinuing support) that Customer and/or
Affiliates must make to their third-party hardware, software, equipment and
communications capabilities and lines so that Customer and/or the Affiliates
can continue to access and receive the Services; provided, however, Customer
has the right to terminate the Agreement if it does not agree to any such
changes.


 


3.3           Accuracy
of Data.  Each party shall
cause all information provided by such party or its Affiliates to the other
party to be complete, accurate, and current, and in the form and format
required by the other party as previously provided to the party providing the
information  or as otherwise
mutually agreed to between the parties.


 


3.4           Extraordinary
Service Needs.  Customer
shall use commercially reasonable efforts to advise Pegasus in writing a
reasonable period of time prior to the occurrence of any events, including
without limitation special promotions, group or tour events and marketing
activities, that Customer knows will require significantly increased support or
levels of service from Pegasus or involve significantly increased usage of any
of the Services by Customer or any Affiliate.


3.5           Network Security.


(a)           Customer shall (i) upon Pegasus’
request, identify the individuals given access by Customer to Pegasus’ networks
and systems and notify Pegasus of any changes to such group; and
(ii) implement and maintain policies and procedures consistent with
Customer’s responses to the most recent Pegasus-provided network security
survey.  Pegasus shall have the right to
deny any individual’s access to Pegasus’ networks and systems due to security
concerns; provided, however, Pegasus has provided Customer with security
requirements in advance and shall provide Customer with the nature of such
security concern and such denial shall not be unreasonable.


 


(b)           To the extent that Pegasus performs
any of the Services via such electronic means, and/or has access to Customer’s
or its Affiliates’ electronic mail, Web site, computer systems or networks,
and/or other Internet systems, Pegasus shall implement industry-standard
security to protect Customer’s and its Affiliates’ computer systems, network
devices and/or the data processed thereon against the risk of penetration by,
or exposure to, a third party via any system or feature utilized by Pegasus in
performing such work and/or accessing such systems.  Unless otherwise specified in the applicable
Service Schedule(s), such protections shall include, but not be limited to, (i)
securing the computer systems and network devices, (ii) protecting against
intrusions of operating systems or software, (iii) implementing access controls
on all data, software or other file-system objects limiting access to only
authorized users,


 


2

















 


(iv)
ensuring the integrity of all data stored or processed, and (v) preventing the
loss of data processed or transferred.


 


(c)           Pegasus shall monitor all service,
equipment, test environment, and communication links for security breaches,
violations and suspicious activity, and shall notify Customer immediately in
the event of any security breaches, violations or suspicious activity


 


4.0  FEES AND COSTS


 


4.1           Fees
and Costs.  The parties
agree to pay the fees and costs for the Services as set forth in the Pricing
Schedule attached hereto and made a part of this Agreement.


 


4.2           Taxes.  Customer shall pay all sales, use, excise, value
added and similar taxes and duties levied by any taxing authority upon this
Agreement or the services provided by Pegasus pursuant to this Agreement other
than taxes that are levied upon Pegasus’ net income or payroll (collectively, “Taxes”).


 


4.3           Payment
of Fees and Costs.


 


(a)           Except as otherwise provided in the Pricing Schedule
attached hereto or in any Service Schedule, all undisputed amounts payable
pursuant to this Agreement are due within thirty (30) days of the date of
receipt of each billing statement and shall be paid in U.S. Dollars.  If any amount is past due pursuant to this
Agreement, in addition to any rights of termination provided herein, the past
due party agrees to pay interest on such amount at the rate of (***) per month,
or the maximum rate allowed by law, whichever is lower; provided, however,
Customer shall not be charged interest if Pegasus is delinquent in
electronically deducting its fees.


(b)           A party shall notify the other party
in writing, within thirty (30) business days of receipt of a billing statement,
of any good faith dispute concerning any amount reflected as due on such
billing statement.  Such notice shall
include a written statement identifying in reasonable detail the facts relating
to the dispute, the amount disputed and the relief requested or proposed.  The dispute of an amount due shall not
relieve any obligations to pay all undisputed amounts in accordance with this
Agreement.  The parties shall use good
faith efforts to resolve any such disputes in a timely manner.


 


4.4           Annual Increase.  Deleted
by agreement.


4.5           Third-Party
Costs and Fees.  Customer
acknowledges that any third party costs passed on by Pegasus to Customer may
not include discounts, rebates or credits received by Pegasus.  All third party charges shall be set forth on
the applicable Pricing Schedule.


 


5.0  TERM


 


5.1           Term
of Agreement. The term of this Agreement shall begin on the
Effective Date and shall continue until the term of each Service Schedule,
including all renewals and extensions thereof, has terminated, provided that
the term of this Agreement may be earlier terminated, as specified below.


 


6.0  TERMINATION


 


6.1           Termination
Upon Default.  Upon the
occurrence of an Event of Default (as defined in Section 7.0 below) by
either party and the failure of the defaulting party to cure such Event of
Default after written notice and opportunity to cure as provided in Section
7.3 hereof, the non-defaulting party may terminate each Service Schedule
affected by such Event of Default upon written notice given to the defaulting
party within thirty (30) days of the expiration of the cure period.  Upon the occurrence of an Event of Default
with respect to Section 4.1 hereof by Customer, or Section 8.1
hereof by either party, and the failure of the defaulting party to cure such
Event of Default after written notice and opportunity to cure as provided in Section
7.3 hereof, the non-defaulting party may terminate this Agreement upon
written notice given to the defaulting party within thirty (30) days of the expiration
of the cure period.


 


3

















 


6.2           Effect of Termination.
 Upon
the termination of this Agreement or any Service Schedule (a) each billed party
shall promptly pay to the billing party all undisputed amounts due to such
billing party pursuant to this Agreement; and (b) the billing party may
continue to perform all or part of the Services consistent with past practices
as operationally necessary to finalize the termination of Services and the
billed party agrees to pay to the billing party the undisputed amounts for
those Services performed that would be payable if the Agreement had not
terminated.  Following the payment to
Pegasus of the amounts described in the preceding sentence, Pegasus shall
deliver to Customer, in a format supported by the Pegasus systems used to
provide the related Services, one or more data files containing all of Customer’s
data stored on such systems as of the date of such termination.


 


6.3           Survival.  Sections 6.2 (Effect of Termination), 6.3
(Survival), 8.1 (Confidentiality), 9.1 (Pegasus Ownership), 9.2 (Customer
Ownership), 9.3(b) (Use of Marks), 9.4 (Definition), , 10.1 (Indemnification),
10.2 (Representations and Warranties), 10.3 (Disclaimer of Warranties), 10.4
(Limitation of Liability), 10.5 (No Consequential Damages), 11.2 (Law and
Venue), 11.11 (Waiver) and 11.12 (Severability) hereof and any rights or
obligations of Pegasus or Customer that may have accrued as of the termination
of this Agreement shall survive such termination.


 


7.0  DEFAULT


 


7.1           Events
of Default.  Subject to Section
7.2 hereof, any one of the following listed occurrences shall be considered
an “Event of Default”:


 


(a)           Either party hereto fails to pay any amount due hereunder
within the time period required;


(b)           Either party hereto commits a material breach of this
Agreement; or


(c)           Either party ceases to do business as
a going concern; becomes insolvent, bankrupt or the subject of a receivership;
makes an assignment for the benefit of its creditors or enters into an
arrangement with creditors in lieu thereof; authorizes, applies for, or
consents to the appointment of a trustee or liquidator of all or substantially
all of its assets or has proceedings seeking such an appointment commenced
against it which are not terminated within sixty (60) days of such
commencement; or has any substantial part of its property subjected to any
levy, seizure, assignment or sale for, or by any creditor or governmental
agency without said levy, seizure, assignment or sale being lifted, released,
reversed or satisfied within ten (10) days.


 


7.2           Force
Majeure.  The occurrence
of an event listed in Section 7.1(b) hereof will not constitute an Event
of Default if the occurrence is caused by or results from governmental
regulation, acts of God, terrorist acts, fire, war, civil unrest, power
fluctuations or outages, public utility failures, mechanical defects, or other
events beyond the control of the affected party, provided that if such event
continues for more than thirty (30) consecutive days, either party may
terminate this Agreement by providing notice to the other party as specified in
Section 11.6 of this Agreement.


 


7.3           Notice
of Default and Cure Period. 
Following the occurrence of an Event of Default, the non-defaulting
party may give written notice to the defaulting party specifying the same.  Except as otherwise provided in the Pricing
Schedule attached hereto or in any Service Schedule, the defaulting party shall
be entitled thirty (30) days after receipt of such notice within which to cure
any default.


 


8.0  CONFIDENTIALITY


 


8.1           Confidentiality.  For purposes of this Agreement, “Confidential
Information” shall mean all information furnished by one party hereto to the
other in connection with this Agreement that is designated or treated as
confidential by the disclosing party; all information concerning the design,
functionality and operation of the Pegasus systems used to provide the
Services; and all Customer data generated by the operation of such systems.  Confidential Information shall not include
any information that (a) is already lawfully known by the receiving party when
received as a matter of record; (b) is
independently developed by the receiving party; (c) is now or hereafter
becomes generally available to the public through no fault of the receiving
party; (d) is received by the receiving
party from a third party legally entitled to make such disclosure; or
(e) is disclosed after the receiving party obtains prior written approval from
the disclosing party for such disclosure. 
Neither party hereto


 


4

















 


shall
use the other party’s Confidential Information for any purpose other than to
fulfill its obligations arising under this Agreement.  Each party hereto shall use reasonable
efforts to keep confidential the other party’s Confidential Information and the
terms and pricing contained in this Agreement and shall not disclose such
information to any person or entity other than its employees, agents, and
affiliates who agree to comply with this Section 8.1 or other than as
required to fulfill its obligations arising under this Agreement.  Each party hereto shall be responsible for
the breach of this Section 8.1 by its employees, agents, and
affiliates.  After the termination of this
Agreement each party hereto shall promptly return to the other party or destroy
all original and duplicate copies of the other party’s Confidential Information
furnished to it upon the written request of the other party, provided that
Pegasus may retain in its records relating to its performance of the Services
Customer’s Confidential Information that is incorporated into such records in
the normal course of Pegasus’ business. 
Each party shall certify any such destruction to the other party within
five business days of such written request. 
Notwithstanding this Section 8.1, Pegasus may use and disclose
data derived by Pegasus in the performance of this Agreement, provided that
neither Customer, nor any Affiliate or customer of any Affiliate, is identifiable
from such data.  In the event that the
receiving party is ordered, by law, rule, regulation, governmental agency or
court of competent jurisdiction, to disclose Confidential Information of the
disclosing party, the receiving party will provide prompt notice of such order
to the disclosing party and cooperate with and assist the disclosing party, at
the disclosing party’s cost and expense, so that the disclosing party may limit
the scope of any disclosure.  To the extent that Pegasus has access to personally
identifiable information (including, but not limited to, names, phone numbers,
addresses, credit card information, social security numbers, and/or account or
financial information) of Customer’s or its
Affiliates’ employees, franchisees, sales associates, brokers, or customers,
Pegasus acknowledges and agrees that such information is highly confidential
and private in nature and agrees to hold such information in the strictest of
confidence, and protect such information, in accordance with Customer’s privacy
policies, the aforementioned confidentiality provisions, and applicable law.
Pegasus shall not use or disclose such personally identifiable
information without the prior written consent of Customer and the applicable
individual(s) to whom the information belongs. In the event that Customer and
the applicable individual(s) so consent, Pegasus may disclose such personally
identifiable information only to the extent expressly permitted by Customer and
such individual(s) and only in accordance with the terms of this Agreement and
applicable law.


 


8.2           No Hire.  Deleted by
agreement.


9.0  INTELLECTUAL
PROPERTY RIGHTS; OWNERSHIP OF DATA


 


9.1           Pegasus Ownership.  Pegasus and its licensors shall retain
exclusive ownership of all right, title and interest, including without
limitation, all Intellectual Property Rights (as defined in Section 9.4
hereof), in and to the Services and the systems and software used by Pegasus to
provide the Services; the design, functionality, operation and components of
the same; all modifications, enhancements and upgrades to the same; and Pegasus’
business methods.  No right, title or
interest of any kind in the foregoing is granted to Customer or any Affiliate
pursuant to this Agreement.


 


9.2           Customer
Ownership.  Customer and
its licensors shall retain exclusive ownership of all right, title and
interest, including without limitation, all Intellectual Property Rights (as
defined in Section 9.4 hereof) in and to (a) Customer’s and Affiliates’ data
residing on the Pegasus systems; and (b) Customer’s and Affiliates’ images
stored during the term of this Agreement on Pegasus’ servers.  No right, title or interest of any kind in
the foregoing is granted to Pegasus pursuant to this Agreement.


 


9.3           Use
of Marks.


 


(a)           Customer represents that it has the right to grant, and
hereby grants, to Pegasus the right to use and display, and store on
Pegasus’ servers, Customer’s and each applicable Affiliate’s trademarks,
service marks, trade names, trade dress, logos, names, and pictures (and those of
any third party which are used or provided by Customer and each of its
applicable Affiliates) to the extent necessary to perform Pegasus’ obligations
in accordance with this Agreement. Notwithstanding the preceding sentence,
Pegasus acknowledges and agrees that it will not obtain any right, title or
interest in or to the foregoing pursuant to this Agreement.


(b)           Customer shall indemnify, defend and hold harmless Pegasus
and its subsidiaries, and the officers, directors employees and agents of the
same, from and against all losses, claims, liability, costs,


 


5

















 


damages, fines, and expenses
(including all legal costs) incurred or suffered by any of the indemnified
parties that arise out of or in connection with a third party claim based upon
the actions described in the preceding subsection (a) other than any losses,
liability, costs, damages, fines or expenses resulting from any indemnified
party’s alteration or misuse of Customer’s or any Affiliate’s trademarks,
service marks, trade names, trade dress, logos, names or pictures.


(c)           Neither party shall use any of the
trademarks, service marks, trade names, trade dress, logos or name of the other
party or its affiliates in any way including, without limitation, in any
advertising or promotional materials, without the prior written approval of the
owning party.  Neither party nor any of
its affiliates shall obtain any right, title or interest in or to the other
party’s Intellectual Property Rights (as defined in Section 9.4 herein)
pursuant to this Agreement.


 


9.4           Definition.  As used in this Agreement, “Intellectual
Property Rights” shall mean any and all now known or hereafter known tangible
and intangible (a) rights associated with works of authorship, including but
not limited to copyrights and moral rights; (b) trademark, trade name and trade
dress rights and similar rights; (c) trade secret rights; and (d) patents,
designs, algorithms and other industrial property rights; all other
intellectual and industrial property rights (of every kind and nature
throughout the world and however designated), whether arising by operation of
law, contract, license or otherwise; and all registrations, initial
applications, renewals, extensions, continuations, divisions or reissues
thereof now or hereafter in force.


9.5           Intellectual
Property Indemnification. 
Should any claim be raised by any third party alleging that Customer’s
use of any of the Services or Intellectual Property Rights constitute
infringement of any United States patent, copyright, license or other property
right (an “IP Claim”), Pegasus will, at its expense, defend such IP Claim and
will indemnify Customer from and against each claim, demand, loss, liability
and expense (including reasonable attorney’s fees) suffered or incurred by
Customer as a result of or in connection with any IP Claim, except to the
extent that an IP Claim arises as a result of (a) a breach by Customer of its
obligations under this Agreement; (b) any alteration or modification made by
Customer to the Services; (c) use of the Services by Customer in combination
with hardware or software not supplied by Pegasus; or (d) any third party’s
access to or use of any of Pegasus’ services. 
After receiving notice of an IP Claim, Customer shall promptly advise
Pegasus of the IP Claim.  Excluding any
settlement negotiations which affect Customer, Pegasus may, at its sole option,
assume sole control of the defense of any IP Claim and any related settlement
negotiations. Customer shall give Pegasus all reasonable information and
assistance, at Pegasus’s expense, reasonably necessary to defend any IP
Claim.  Should Customer be temporarily or
permanently enjoined from using any Service or Intellectual Property as a
result of any IP Claim, Pegasus, at its own expense, will either procure for
Customer the right to continue to use the Service free from any IP Claim or
replace or modify the offending Service or Intellectual Property so that its
use by Customer becomes non-infringing, as soon as reasonably practicable
following the date on which Pegasus receives notice of such injunction, or
Customer may terminate this Agreement.


 


10.0  REPRESENTATIONS AND WARRANTIES; DISCLAIMER OF
WARRANTIES; INDEMNIFICATION;LIMITATION OF LIABILITY


 


 


10.1         Indemnification.  Each party to this Agreement agrees to
indemnify and hold harmless the other party, the other party’s subsidiaries and
affiliates, and the respective successors and assigns thereof, from any and all
third party losses, liability, damages, costs, claims, demands, actions, or
suits, including reasonable attorneys’ fees and court costs (collectively a “Claim”),
which arise directly or indirectly out of: (i) any breach of Sections 10.2(a),
10.2(b)(iii) or 10.2(b)(iv), (ii) with respect to Pegasus, any loss,
misdirection, or conversion of the funds remitted to Pegasus that resulted from
any error by Pegasus, or (iii) the gross negligence or willful misconduct of
the indemnifying party in connection with its participation/performance
hereunder.  After receiving notice of a
Claim subject to indemnification hereunder, the indemnified party shall
promptly advise the indemnifying party of such Claim.  Excluding any settlement negotiations which
affect the indemnified party, the indemnifying party may, at its sole option,
assume sole control of the defense of any Claim and any related settlement
negotiations.  The indemnified party
shall give the indemnifying party all reasonable information and assistance, at
the indemnifying party’s expense, reasonably necessary to defend any Claim.


 


 


10.2         Representations
and Warranties.


 


6

















 


(a)           Each party warrants and represents to
the other party that:  it is free
of any contractual obligations that would prevent it from entering into and
performing its obligations under this Agreement.


(b)           Pegasus warrants and represents to
Customer that:


(i)            It will perform its obligations
under this Agreement using all reasonable skill and care;


(ii)           All personnel assigned by Pegasus to
perform Pegasus’ obligations under this Agreement shall be competent and will
perform their duties in a professional manner;


(iii)          it shall use commercially reasonable
efforts to ensure, by means of recognized diagnostic and security procedures,
that the Services shall be free from disabling programs or devices and
contamination by any virus and that it will not introduce any such disabling
programs or devices and viruses onto the Customer’s or Affiliate’s systems
while performing the Services; and


(iv)          There are no actions, suits or
proceeding pending which shall have a material affect on Pegasus’ ability to
fulfill its obligations under this Agreement


 


10.3         Disclaimer
of Warranties.  EXCEPT AS
SET FORTH IN SECTION 10.2 ABOVE, NEITHER PARTY MAKES AND EACH PARTY
HEREBY SPECIFICALLY DISCLAIMS ALL OTHER 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 NON-INFRINGEMENT, RELATING TO THE SUBJECT MATTER OF THIS AGREEMENT.


 


10.4         Limitation
of Liability.  PEGASUS,
ITS SUBSIDIARIES AND AFFILIATES SHALL HAVE NO LIABILITY ARISING FROM OR
RELATING TO (i) THE FAILURE OF THE SERVICES TO OPERATE OR FUNCTION DUE TO
APPLICATIONS, EQUIPMENT, SERVICES, CONTENT OR NETWORKS PROVIDED BY CUSTOMER, AN
AFFILIATE OR A THIRD PARTY NOT ACTING AS PEGASUS’ AGENT; (ii) INTERRUPTIONS OF
CUSTOMER’S OR ANY AFFILIATE’S ACCESS TO THE SERVICES OR LOST OR ALTERED
TRANSMISSIONS NOT CAUSED BY PEGASUS; (iii) UNAUTHORIZED ACCESS TO OR THEFT,
ALTERATION, LOSS OR DESTRUCTION BY ANY THIRD PARTY OF CUSTOMER’S OR ANY
AFFILIATE’S APPLICATIONS, CONTENT, DATA, INFORMATION, NETWORKS OR SYSTEMS NOT
CAUSED BY PEGASUS; (iv) DATA PROVIDED OR ENTERED BY CUSTOMER, ANY AFFILIATE OR
ANY THIRD PARTY (OTHER THAN ANY ERROR OR OMISSION IN DATA CAUSED BY PEGASUS’,
OR PEGASUS’ AGENTS’ OR SUBCONTRACTORS’, ENTRY OF THAT DATA); OR (v) ANY GOOD OR
SERVICE SUPPLIED TO CUSTOMER OR AN AFFILIATE BY ANY THIRD PARTY THAT IS
REFERRED BY PEGASUS OR THAT HAS A HYPERLINK, ADVERTISEMENT OR OTHER PRESENCE ON
ANY PAGE OR SCREEN DISPLAYED BY PEGASUS. 
EXCEPT FOR EACH PARTY’S INDEMNIFICATION AND CONFIDENTIALITY OBLIGATIONS,
AND PAYMENT OBLIGATIONS, IN NO EVENT WILL EITHER PARTY’S LIABILITY UNDER THIS
AGREEMENT EXCEED THE TOTAL FEES AND COSTS PAID BY CUSTOMER FOR THE SERVICES
DURING THE TWELVE (12) MONTHS IMMEDIATELY PRECEDING THE DATE OF THE CAUSE OF
ACTION OR OCCURRENCE WHICH IS THE BASIS OF EITHER PARTY’S CLAIM AGAINST THE
OTHER PARTY.


 


10.5         No
Consequential Damages. 
EXCEPT FOR THE OBLIGATIONS SET FORTH HEREIN PERTAINING TO
CONFIDENTIALITY AND INDEMNIFICATION, IN NO EVENT WILL EITHER PARTY, NOR ANY
AFFILIATE, BE LIABLE FOR ANY PUNITIVE, INCIDENTAL OR CONSEQUENTIAL DAMAGES IN
ANY ACTION ARISING FROM OR RELATED TO THE TERMS AND CONDITIONS OF THIS
AGREEMENT, WHETHER BASED IN CONTRACT, TORT (INCLUDING NEGLIGENCE), INTENDED
CONDUCT OR OTHERWISE, INCLUDING, WITHOUT LIMITATION, DAMAGES RELATING TO THE
LOSS OF PROFITS, INCOME OR GOODWILL, REGARDLESS OF WHETHER SUCH PARTY HAS BEEN
ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.


 


11.0  MISCELLANEOUS


 


11.1         Mandatory
Arbitration.  Deleted by
agreement.


 


11.2         Law
and Venue.   If any
dispute between Pegasus and Customer arises out of this Agreement, the parties
agree that the laws of the State of New York, USA shall control without
reference to its conflict of laws principles. 
In the event Pegasus institutes any legal proceeding relating to this
Agreement against Customer,


 


7

















 


venue
for such proceeding shall be in New York County, New York, and in the event
Customer institutes any legal proceeding relating to this Agreement against
Pegasus, venue for such proceeding shall be in Dallas County, Texas.


 


11.3         Compliance
with Laws.  Each party
shall fully comply with all material laws, regulations and governmental orders
applicable to their performance of this Agreement, including without limitation
those regarding trade sanctions, export control, data protection and the
processing of personal data.  Notwithstanding
anything to the contrary contained in this Agreement, in no event shall either
party or any of its affiliates be required to perform hereunder to the extent
that such party reasonably concludes that such performance may violate any
applicable law, regulation or governmental order.


 


11.4         Status
of Parties.  This
Agreement does not constitute a partnership, joint venture, or similar
arrangement between the parties, and neither party nor any of their respective
directors, officers, employees or agents shall be deemed to be an agent,
employee, or legal representative of the other. 
Neither party hereto is authorized by this Agreement to bind the other
or otherwise act in the name of or on behalf of the other.  Nothing in this Agreement shall be construed
to give any person or entity other than Pegasus and Customer any legal or
equitable right, remedy or claim in connection with or arising from this
Agreement.


 


11.5         Assignment.  This Agreement is not assignable by Pegasus
or Customer without the prior written consent of the other party, and such
consent may not be unreasonably withheld or delayed.  Notwithstanding the foregoing, either party
may assign this Agreement without consent in the event of a merger, acquisition
or sale of all or substantially all of its assets provided the assignee
unconditionally assumes the Agreement in writing.  Either party may assign this Agreement or any
part of the Services to any of its subsidiaries or affiliates without the other
party’s consent.  Any assignment of this
Agreement in violation of this section shall be void and unenforceable.  Notwithstanding the foregoing, if a Pegasus
Change in Control occurs, Customer may terminate this Agreement with sixty (60)
days prior written notice.  For purposes
of this provision, a “Pegasus Change in Control” means an event in which
Pegasus becomes controlled by, or an affiliate of, a Customer competitor.  For purposes of this provision, “controlled
by” means the possession, directly or indirectly, of the power to direct or
cause the direction of management or policies (whether through ownership of
securities or partnership or other ownership interests, or by contract).  For purposes of this provision, “Customer
competitor” means Amadeus Global Travel Distribution S.A., Sabre, Inc.
(including Easy Sabre, Travelocity, Site59 and GetThere), Hotels.com,
Hotwire.com and Expedia Inc. (including Travelscape) and all subsidiaries and
affiliates of, and any successor entity to, any of the foregoing


 


11.6         Notices.  All notices contemplated hereby must be in
writing and (a) personally delivered; (b) deposited in the mail, first-class,
registered or certified mail, return receipt re­quested, or similar service
with postage prepaid; or (c) sent by overnight courier service (for next
business day delivery if within the country of the sender or second business
day delivery if outside the country of the sender), shipping prepaid as follows
(or to such persons or addresses as any party may request by notice duly given
hereunder):


 


	
  If to
  Pegasus:

  	
  If to
  Customer:

  
	
  Pegasus Solutions, Inc.

  8350 N. Central Expressway, Suite 1900

  Dallas, Texas 75206 USA

  Attn: Gideon Dean

  	
  Cendant Travel
  Distribution Services Group

  7 Sylvan Way

  Parsippany, New Jersey 07054

  Attn: Jeff Horch, Hospitality Distribution

  
	
   

  	
   

  	
   

  	
   

  
	
  cc: 

  	
  Ric L. Floyd, General Counsel

  at the same address

  	
  cc: 

  	
  General Counsel,

  at the same address

  



 


Except
as otherwise specified herein, notices will be deemed given and received at the
time of delivery or of refusal of delivery.


 


11.7         Entire
Agreement; Controlling Language. 
This Agreement, the Service Schedules and any other attachments hereto
constitute the entire agreement between Pegasus and Customer with respect to
the subject matter of this Agreement and supersedes and replaces any and all
other agreements and representations, verbal or written, with respect
thereto.  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 set forth in this Agreement.
This Agreement (including the Service Schedules and any other attachments
hereto) may not be amended or modified other than by a written agreement
executed by Customer and Pegasus.  In the
event of any conflict between the


 


8

















 


terms
of this Agreement and the terms of any Service Schedule, the terms of this
Agreement shall control.  This Agreement
has been executed in the English language, which shall be the controlling
language with respect to this Agreement in all respects.  Any translation of this Agreement into
another language is for convenience only and no such translation shall be
binding against the parties hereto.


 


11.8         Exclusive
Agreement.  Deleted by
agreement.


 


11.9         Successors
and Assigns.  This Agreement
shall 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.


 


11.10       Execution;
Retention.  This Agreement
may be executed in counterparts, each of which when so executed shall be deemed
to be an original and all of which taken together shall constitute one and the
same agreement enforceable against each party in accordance with its
terms.  A signature delivered by
facsimile transmission shall be effective to bind the executing party.  This Agreement may be retained or stored by
either party solely in an electronic format, and any reproduction of this
Agreement by reliable means from an electronic format shall be deemed an
original.


 


11.11       Waiver.  Except as otherwise provided herein, the
failure of a party hereto to exercise any of its rights or to enforce any of
the provisions of this Agreement on any occasion shall not be a waiver of such
right or provision, nor affect the right of such party thereafter to enforce
such right or provision.


 


11.12       Severability.  If any provision of this Agreement shall be
held illegal, invalid or unenforceable by a court of competent jurisdiction, in
whole or in part, such provision shall be deemed modified to the minimum extent
necessary to make it legal, valid and enforceable, and the legality, validity
and enforceability of the remaining provisions shall not be affected.


 


11.13       Insurance.  At no cost to Customer, Pegasus shall obtain
and maintain commercial general liability insurance from on or more companies
having an A.M. Best’s Rating of A-VII or better, which insurance will have
minimum limits of $2,000,000 bodily injury and property damage per occurrence;
shall be occurrence based; and shall include personal injury coverage.


 


IN WITNESS WHEREOF, the parties hereto have
executed this Agreement as of the date first above written.


 


	
  PEGASUS SOLUTIONS, INC.

  	
   

  	
  CENDANT  TRAVEL DISTRIBUTION

  
	
   

  	
   

  	
  SERVICES
  GROUP, INC.

  
	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ RALPH E. COMPTON III

  	
   

  	
  By:

  	
  /s/ JEFF HORCH

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Name: 

  	
  Ralph E. Compton III

  	
   

  	
  Name:

  	
  Jeff Horch

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  	
  Title:

  	
   

  



 


 


9














 


	
  Region: circle one

  	
   

  	
   

  	
   

  	
  UltraDirect Services 

  
	
  1     2     3     4     5     6     7

  	
   

  	
   

  	
   

  	
  Schedule

  
	
  8     9     10     11     12     13

  	
   

  	
   

  	
   

  	
   

  



 


 


 


This UltraDirect Services
Schedule is attached to and a part of the Master Services Agreement with the
Effective Date of _______________, 200__, by and between Pegasus Solutions,
Inc. and Cendant Travel Distribution Services Group, Inc.


1.             Definitions.  All capitalized terms used in this
UltraDirect Services Schedule but not defined herein shall have the meanings
set forth elsewhere in this Agreement. 
In addition, the following definitions shall apply for purposes of this
UltraDirect Services Schedule:


(a)           UltraDirect Services
Schedule Effective Date means _____________________, 200__.


(b)           Available
means that (i) the Reservation
Function transmits Reservations Data materially in accordance with the terms of
this UltraDirect Services Schedule; and (ii) the Reservation Function is
accessible from the point at which the Pegasus data center local area network
intersects with the wide area networks over which Reservations Data are
transmitted to the Reservation Function pursuant to this UltraDirect Services
Schedule. It is the intent of both parties to work toward valid responses from
the central reservations systems represented. 
Pegasus’ contribution will include the Best Practices Certification
initiative for CRS’s.


(c)           Customer's Web Site
means the Internet site(s) created, maintained and hosted by or on behalf of
Customer with the following address(es):                          ,
and any successor or replacement site(s) created, maintained and hosted by or
on behalf of Customer.


(d)           Downtime
is the amount of time during which the Reservation Function is not Available,
subject to the provisions of subparagraph 8(c) of this UltraDirect Services
Schedule.


(e)           Fees
means those fees set forth in paragraphs 2 
through 5 of the UltraDirect Pricing Schedule to this Agreement.


(f)            Geo Search means
functionality allowing an accessor of Customer’s Web Site to receive, in
response to a query, a list of the lodging establishments whose information
appears in the Online Distribution Database that satisfy the following
criteria: (i) a location described as either a physical address or latitude and
longitude; and (ii) a radial distance in miles or kilometers specified from
such location.


(g)           Geo
Search Maps means functionality allowing an accessor of Customer’s
Services to request and view a map showing the lodging establishments included
in the Online Distribution Database in response to a Geo Search query.


(h)           Issue
means a problem that causes a failure of, or a degradation in, the operation of
the Reservation Function or the Online Distribution Database


(i)            Look
to Book Ratio means the ratio of (i) the sum of Single Property
Availability Requests plus Multi-Property Availability Requests plus Rate Plan
Information Requests with respect to a particular time period, to (ii) Total
Reservations with respect to the same time period.


(j)            Maintenance
Window means the following hours, subject to change upon the
agreement of Pegasus and Customer: (i) 10:00 p.m. to midnight, Mountain
Standard Time (North America), on each Friday; and (ii) 9:00 p.m. to midnight,
Mountain Standard Time (North America), on each Saturday.


(k)           Monitoring
Application means an automated monitoring application employed by
Pegasus that generates test messages, causes such messages to be transmitted
throughout the technology infrastructure used by Pegasus to deliver the
Services and records the results of each transmission for later analysis.


(l)           Multi-Property
Availability Request means a single request message for rates and
availability relating to two or more lodging properties that is transmitted
through the UltraDirect Interface pursuant to this UltraDirect Services Schedule.


(m)         Net Reservations means the number of
reservations transmitted through the UltraDirect Interface


 


1

















 


during a particular time period, less the number of
cancellations of reservations transmitted through the UltraDirect Interface
during the same time period.


 


(n)           Offensive
Content means content that, is defamatory, obscene, pornographic,
gratuitously violent or otherwise offensive.


(o)           Online Distribution
Database means a digital database of lodging data and images created
and maintained by or for Pegasus.


(p)           Onward Distributor
means a party other than Pegasus or Customer that operates an electronic system
that displays and transmits Reservations Data which includes providers of
metasearch or rate auditing functionality (also known as crawlers) that have
contractual relationships with Customer.


(q)           Rate Plan Information
Request means a single request message for detailed information
regarding a specified rate and room type that is transmitted through the
UltraDirect Interface pursuant to this UltraDirect Services Schedule.


(r)            Reservations
Data means reservation rate and availability information, and
information relating to the making, changing and canceling of reservations.


(s)           Reservation
Function means Pegasus-provided functionality that transmits
Reservations Data between reservation systems and other systems.


(t)            Response Time means
the time elapsed from Customer’s submission of a valid request to Pegasus’
return of response excluding time for respective CRS response.


(u)           Scheduled
Downtime means a period of time (i) during the Maintenance Window,
(ii) during which the Reservation Function is not Available, and (iii)
with respect to which Pegasus gives Customer notice in compliance with
subparagraph 8(d) of this UltraDirect Services Schedule.


(v)           CRS Scheduled Downtime
means a period of time during which a particular CRS is not Available, and with
respect to which such CRS has given Pegasus advance notice.


(w)          Single Property
Availability Request means a single request message for rates and
availability relating to one lodging property that is transmitted through the
UltraDirect Interface pursuant to this UltraDirect Services Schedule.


(x)            Total Reservations
means the total number of reservation requests transmitted through the
UltraDirect Interface pursuant to this UltraDirect Services Schedule.


(y)           UltraDirect
Interface means an interface between (i) Customer’s Web Site and
(ii) the Online Distribution Database and the Pegasus system(s) performing
the Reservation Function.


(z)            UltraDirect
Services means the services described in paragraph 2 of this
UltraDirect Services Schedule.


 


2.             UltraDirect
Services.  Pegasus agrees
to (a) provide Customer with specifications for Customer’s use in creating and
implementing the UltraDirect Interface; (b) grant Customer’s Web Site access to
the Online Distribution Database and the Reservation Function through the
UltraDirect Interface created, implemented and maintained by Customer in
conformity with such specifications, for the purpose of permitting accessors of
Customer’s Web Site to view data residing in the Online Distribution Database
and to transmit and view Reservations Data; and (c) use commercially reasonable
efforts to support Customer’s implementation and maintenance of the UltraDirect
Interface.


 


3.             Customer’s Duties.


General.  Customer shall (i) diligently create,
implement and maintain the UltraDirect Interface in accordance with this
UltraDirect Services Schedule; (ii) be solely responsible for the creation of
all necessary URL links from Customer’s Web Site to the Online Distribution
Database and the Reservation Function; and (iii) except as expressly permitted
under this Agreement, not permit the Online Distribution Database, the
Reservation Function or the UltraDirect Interface to be copied, downloaded,
hyperlinked or in any manner used or redistributed in whole or in part except
as expressly permitted by this Agreement


 


2

















 


(a)                         Onward Distributors. 
Except as set forth in this paragraph, Customer shall not knowingly
permit any third party, other than end-user consumers who access Customer’s Web
Site, access to or use of data transmitted through the UltraDirect
Interface.  Customer may permit Onward
Distributors access to and use of data transmitted through the UltraDirect
Interface, subject to Pegasus’ right to prohibit such access and use by any
Onward Distributor, provided that


(i)                                      prior to
permitting such access and use by an Onward Distributor, Customer provides
written notice to such Onward Distributor stating that (A) such data and the
systems transmitting the same are the sole and exclusive property of Pegasus,
its licensors and/or the lodging establishments whose information appears in
the Online Distribution Database (provided Pegasus need not be named); and (B)
no right, title or interest of any kind in such systems or data is granted by
Pegasus to such Onward Distributor by virtue of its access to and use of such
data. [Our agreements with our affiliates make clear the data is owned by “Third
Parties” and “Suppliers” but do not mention Pegasus by name]


(ii)                                   Customer uses
reasonable efforts to terminate such access and use by any Onward Distributor
that displays Offensive Content on any electronic system maintained and hosted
by or on behalf of such Onward Distributor


(iii)                               In
consideration of Pegasus’ agreement to permit Onward Distributors access to and
use of data transmitted through the UltraDirect Interface, Customer hereby
agrees to indemnify, defend and hold harmless Pegasus, its directors, officers,
employees, agents, successors and assigns, from and against any and all
liability and every loss, cost, damage, claim, cause of action and expense
(including reasonable attorneys’ fees) paid or incurred by and one or more of
them arising from or attributable to such access or use by any Onward
Distributor or a user of any Onward Distributor in violation of the terms of
this Agreement provided such loss, cost, damage, claim, cause of action and
expense is not attributable to Pegasus’ negligence or misconduct (or that of
Pegasus’ affiliates).


(b)       Bursting; Look to Book Ratio.


(i)            Methods to Reduce Ratio.  Each party shall (i) confer with the other
party in good faith regarding recommended methods for reducing the Look to Book
Ratio; and (ii) use commercially reasonable efforts to implement those
recommended methods that Pegasus and Customer agree in good faith are
practicable.  Pegasus shall continue to
implement measures to improve system stability.


(ii)           Excess Ratio.  If the Look to Book Ratio exceeds 1,000:1
with respect to a calendar month then:


                                                    (a)          The Fees set forth in paragraph 3 of
the UltraDirect Pricing Schedule apply; and


                                                    (b)          Pegasus shall not be obligated to
transmit Customer Reservations Data during the calendar month immediately
following such month to any central reservation system  to which the operator of such system has
requested that Customer Reservations Data not be transmitted, provided,
however, that Pegasus promptly notifies Customer of such request.


 


4.             Use of Reservation
Function.  If information
from the Online Distribution Database regarding a lodging establishment is
provided to an accessor of Customer’s Web Site or an Onward Distributor,
Customer shall use reasonable efforts to ensure that such accessor of Customer’s
Web Site or Onward Distributor transmits Reservations Data regarding such
lodging establishment exclusively through the Reservation Function, provided
that Pegasus’ sole remedy for a breach of this Section 4 shall be to terminate
this Schedule upon thirty (30) days’ prior notice to Customer.


5.             Offensive Content.  Pegasus may immediately terminate the
provision of UltraDirect Services to Customer for any period of time during
which Customer’s Web Site, or any electronic system maintained and hosted by or
on behalf of an Onward Distributor with access to and use of data transmitted
through the UltraDirect Interface, displays any Offensive Content.  Notwithstanding the foregoing, before Pegasus
exercises its termination right set forth in the preceding sentence, Pegasus
shall first afford Customer the opportunity to remove such Offensive Content
within twenty-four (24) hours after receiving written notice from Pegasus.


 


3

















 


6.             Data Transmission.  The transmission of data between Customer’s
Web Site and the UltraDirect Interface shall occur by such means as are
mutually agreed by Customer and Pegasus.


7.             Online Distribution
Database Download.  Pegasus agrees to allow Customer,
and Customer agrees to perform, a complete download to Customer’s Web Site of
all property-descriptive information in the Online Distribution Database, such
download to occur an a date mutually agreed by Customer and Pegasus, but not
occur after the 5th day of each month. Pegasus agrees to allow, and
Customer agrees to perform, on a daily basis thereafter one (1) download to
Customer’s Web Site of any property-descriptive information in the Online
Distribution Database that has been modified since the last download.  Customer further agrees to make a good faith
effort to make modified property-descriptive information accessible to
accessors of Customer’s Web Site within two (2) business days of Customer’s
download of the same.  Customer shall not
permit information downloaded pursuant to this paragraph to be further
downloaded to any third party system and shall not distribute such information
to any third party in any tangible medium. 
Upon the earlier of the termination of this UltraDirect Services
Schedule or such time as Customer ceases to perform downloads as provided
above, Customer shall promptly delete from its systems all information
downloaded pursuant to this paragraph which is not publicly available elsewhere
and shall promptly destroy or return to Pegasus all physical copies of any such
information.  Upon Pegasus’ request,
Customer shall certify to Pegasus any such deletion, destruction and return
within five business days of receipt of such request.


 


8.             Service
Availability Commitment.


(a)          Service
Availability/Service Level Credit. 
If Pegasus is unable to achieve a level of 99.8% Availability of the
Reservation Function during each calendar month as a percentage of all time
during such calendar month,  Pegasus
shall, as Customer’s sole and exclusive remedy for such violation, pay to
Customer in the following calendar month a fee calculated in accordance with
the following table:


 


	
  Availability
  of the

  Reservation Function

  During Each Calendar

  Month

  	
   

  	
  Service
  Level Fee Payable by

  Pegasus to Customer

  (Effective Date through August 31,

  2005)

  	
   

  	
  Service
  Level Fee Payable

  by Pegasus to Customer

  (September 1, 2005 onward)

  
	
  99.79% - 99.75%

  	
   

  	
  (***) per Net Reservation

  	
   

  	
  (***) per Net Reservation

  
	
  99.74% - 99.70%

  	
   

  	
  (***) per Net Reservation

  	
   

  	
  (***) per Net Reservation

  
	
  99.69% - 99.60%

  	
   

  	
  (***) per Net Reservation

  	
   

  	
  (***) per Net Reservation

  
	
  99.59% - 99.50%

  	
   

  	
  (***) per Net Reservation

  	
   

  	
  (***) per Net Reservation

  
	
  99.49% - 99.40%

  	
   

  	
  (***) per Net Reservation

  	
   

  	
  (***) per Net Reservation

  
	
  99.39% - 99.01%

  	
   

  	
  (***) per Net Reservation

  	
   

  	
  (***) per Net Reservation

  
	
  99.00% - below

  	
   

  	
  (***) per Net Reservation

  	
   

  	
  (***) per Net Reservation

  



 


 


In
the event Customer owes Pegasus any amounts under this Agreement, Pegasus will
offset/credit the Service Level Fees specified above payable by Pegasus against
any such amounts owed to Pegasus by Customer.


(b)          Downtime
Measurement.  The amount of
Downtime during any period will be determined by reference to the results
recorded by the Monitoring Application and agreed upon by Pegasus and Customer
(agreement not to be unreasonably withheld by either party).  Downtime end times will be demarked by
written (email) notification by Pegasus to Customer.


(c)          Downtime
Exclusions.  Downtime shall
not include any time during which the Reservation Function is not Available due
to:


(i)                                 up to four (4)
hours of Scheduled Downtime per calendar month


(ii)                              acts or
omissions of any party other than Pegasus or Pegasus’ vendors and agents;


 


4

















 


(iii)                           hardware,
software, networks, equipment or interfaces other than those provided or
managed by Pegasus or Pegasus’ vendors and agents;


(iv)                          third-party
service providers other than Pegasus’ vendors and agents;


(v)                             any other
equipment, applications or components not directly managed or controlled by
Pegasus or Pegasus’ vendors and agents; or


(vi)         one or more of the causes listed in Section
8.2 of  the Master Services
Agreement.


 


 


(d)          Notice
by Pegasus of Scheduled Downtime. 
Pegasus will give notice of Scheduled Downtime to Customer by e-mail or
such other means as mutually agreed by Customer and Pegasus.  In addition, Pegasus will give notice of CRS
Scheduled downtime to Customer by e-mail or such other means as mutually agreed
by Customer and Pegasus, to the extent Customer obtains written permission from
such CRS for Pegasus to provide such notice. 
Such notice will be given by Pegasus to the individual designated by
Customer for the receipt of such notices and will be given no less than five
(5) calendar days prior to the commencement of the subject Scheduled Downtime
provided Pegasus is informed prior to five (5) calendar days.  Any such notice given by Pegasus will include
the date and time of commencement of the subject Scheduled Downtime and an estimate
of the duration of the subject Scheduled Downtime


(e)          Notice
by Customer of Scheduled Outage. 
The parties acknowledge and agree that Pegasus could interpret the
cessation of activity though the UltraDirect Interface from Customer’s Web Site
as an Issue requiring action by Pegasus pursuant to paragraph 9 below.  Consequently, Customer agrees to use
commercially reasonable efforts to provide Pegasus prior notice, by e-mail or
such other means as mutually agreed by Customer and Pegasus, of any plan by
Customer to make Customer’s Web Site unavailable to transmit Reservations Data
to, or to receive transmissions of Reservations Data from, the Reservation
Function for any period of time.  Any
such notice given by Customer will include the date and time of commencement of
the subject unavailability and an estimate of the duration of the subject
unavailability


(f)           Event
of Default.  Nothing contained in paragraph
8(a) above shall  be interpreted to
limit the rights and remedies of Customer in the case of an Event of Default,
as such term is defined in Section 7.0 of Master Services Agreement.


 


9.             Response
Time Commitment.  The
following table sets forth percentage of responses (all request types) that
must be received within the associated time limit (excluding requests submitted
during Scheduled Platform Maintenance):


	
  Percentage of Responses

  	
   

  	
  Response Time

  
	
  100%

  	
   

  	
  10 seconds

  
	
  95%

  	
   

  	
  5 seconds

  
	
  90%

  	
   

  	
  3 seconds

  



 


(a)                           Pegasus will
provide an xml request that will return a consistent result that will allow
Cendant to verify that the Pegasus electronic distribution environment is
available and able to perform requested work. 
 The Cendant test request through this monitor will also test the
Response Time of the transaction.  Pegasus will have the same (or similar)
monitoring capability local to their systems and will provide Cendant access to
the monitor’s results in near real-time via a portal.


(b)                              For any
calendar month in which the Response Times do not meet any or all of the
thresholds outlined above, then the Net Reservation Fees payable by Pegasus to
Customer pursuant to paragraph 2 of the UltraDirect Pricing Schedule with
respect to each Net Reservation processed during such month shall be increased
in accordance with the following table:


 


5

















 


	
   

  	
   

  	
  Potential Result Sets

  	
   

  
	
  100%
  within 10 seconds

  	
   

  	
  X

  	
   

  	
  X

  	
   

  	
  X

  	
   

  	
  X

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  95%
  within 5 seconds

  	
   

  	
  X

  	
   

  	
  X

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  X

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  90%
  within 3 seconds

  	
   

  	
  X

  	
   

  	
   

  	
   

  	
  X

  	
   

  	
   

  	
   

  	
  X

  	
   

  	
  X

  	
   

  	
   

  	
   

  
	
  Addition
  to Net Reservation fee

  	
   

  	
  (***)

  	
   

  	
  (***)

  	
   

  	
  (***)

  	
   

  	
  (***)

  	
   

  	
  (***)

  	
   

  	
  (***)

  	
   

  	
  (***)

  	
   

  



Note:  “X” denotes meeting requirement


 


10.           Issue
Resolution.


(a)        Severity
Level Description.  The
following table sets forth the criteria by which Customer will determine the
appropriate classification for each Issue identified by or reported to Pegasus:


	
  Severity
  Level

  	
   

  	
  Description

  
	
  1

  Emergency

  	
   

  	
  Reservation Function not Available (other than
  during Scheduled Downtime); or severe impact to Customer business operations;
  or potential for significant Customer loss of revenue

  
	
  2

  High

  	
   

  	
  Significant impact to Customer business
  operations; or significant impact to Customer’s use of the Reservation
  Function and absence of a work-around

  
	
  3

  Medium

  	
   

  	
  Significant impact to Customer’s use of the
  Reservation Function but a work-around exists

  
	
  4

  Low

  	
   

  	
  Any
  Issue that is not appropriately classified as Severity 1, 2 or 3

  



 


(b)         Issue
Resolution Procedures.  The
following table sets forth (i) the time periods within which Pegasus will
communicate with Customer (by telephone or electronic means) with respect to
each Issue reported to Pegasus; and (ii) Pegasus’ commitments to resolve, or
mitigate the effects of, such  Issue:


 


	
  Severity
  Level

  	
   

  	
  Communication

  	
   

  	
  Resolution
  or Mitigation

  
	
  1

  Emergency

  	
   

  	
  Pegasus will contact Customer within thirty (30)
  minutes of receiving the initial report of the Issue, and will update Customer
  every thirty (30) minutes thereafter until the Issue is resolved.

  	
   

  	
  Pegasus commits to resolve the Issue or implement
  a work-around for the Issue that effectively mitigates the effects of the
  Issue within two (2) hours of Pegasus’ receipt of the initial report of such
  Issue.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Within five (5) business days of resolution,
  Pegasus will deliver to Orbitz a written analysis detailing the causes of the
  of Issue.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2

  

  High

  	
   

  	
  Pegasus will contact Customer within sixty (60)
  minutes of receiving the initial report of the Issue, and will update
  Customer every sixty (60) minutes until the Issue is resolved.

  	
   

  	
  Pegasus commits to resolve the Issue or implement
  a work-around for the Issue that effectively mitigates the effects of the
  Issue within six (6) hours of Pegasus’ receipt of the initial report of such
  Issue.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Within five (5) business days of resolution,
  Pegasus will deliver to Orbitz a written analysis detailing the causes of the
  of Issue.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3

  	
   

  	
  Pegasus will contact Customer: (i) on 

  	
   

  	
  Pegasus commits to resolve the Issue or 

  



 


6

















 


	
  

  Medium

  	
   

  	
  the same business day if the initial report is
  received during normal business hours and Pegasus is able to respond on the
  same business day or (ii) the next business day of receiving the initial
  report of the Issue if Pegasus is unable to resolve on the same business day.
  Pegasus will update Customer daily thereafter until the Issue is resolved.

  	
   

  	
  implement a work-around for the Issue that
  effectively mitigates the effects of the Issue within five (5) business days
  of Pegasus’ receipt of the initial report of such Issue.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4

  Low

  	
   

  	
  Pegasus
  will contact Customer within three (3) business days of receiving the initial
  report of the Issue.

  	
   

  	
  Pegasus will resolve the Issue or implement a
  work-around for the Issue that effectively mitigates the effects of the Issue
  within ten (10) business days of Pegasus’ receipt of the initial report of
  such issue.

  



 


(c)        Conditions
to Pegasus’ Obligations. 
Pegasus’ performance of the obligations set forth in the preceding
subparagraph 9(b) with respect to an Issue are conditioned upon  (i) Customer taking such reasonable
actions within its control as are required to resolve or mitigate the Issue, as
applicable; (ii) with respect to a Severity Level 1 Issue, Customer
committing personnel and corporate resources as reasonably  necessary and without regard to normal
business hours to assist Pegasus so that Pegasus can promptly research and resolve
the Issue; and (iii) with respect to a Severity Level 2 or a Severity
Level 3 Issue, Customer committing personnel and corporate resources as  reasonably necessary during normal business
hours to assist Pegasus so that Pegasus can promptly research and resolve or
mitigate the Issue, as applicable


11.           Time Period Targets.


(a)          Implementation.  Pegasus and Customer will each use
commercially reasonable efforts to implement the UltraDirect Services for any
affiliates of Customer that wish to receive to receive the Services hereunder
within forty-five (45) business days of the UltraDirect Services Schedule
Effective Date, subject to the provisions of the governing plan and schedule of
implementation and to the performance of all necessary actions by any third
party.


(b)          Professional
Services.  Pegasus will use
commercially reasonable efforts to provide to Customer, within ten (10)
business days of Customer’s request for services to be performed by Pegasus’
Professional Services group, an estimated schedule for, and the estimated total
cost of, the requested services.


12.                         Term.


(a)                                 This
UltraDirect Services Schedule shall be effective as of the UltraDirect Services
Schedule Effective Date and shall continue in effect for an initial term of two
(2) years from such date unless terminated earlier as provided in this
Agreement.  The term of this UltraDirect
Services Schedule shall thereafter automatically renew for additional,
successive one (1) year terms unless either party provides written notice to
the other party of its intent to terminate this UltraDirect Services Schedule
at least ninety (90) days prior to the expiration of the then-current term.


(b)          Notwithstanding the foregoing, Customer may terminate this
UltraDirect Services Schedule upon the expiration of the first initial twelve
(12) months of the initial term subject to Customer: (i) providing
ninety (90) days prior written notice and (ii) paying to Pegasus an early
termination fee (which serves as liquidated damages hereunder and not a
penalty) equal to the sum the product of: (x) the average number of (***)
during the previous (***) Billing Periods prior to such termination and
(y) (***), multiplied by (***).


 


7

















 


 


	
  PEGASUS
  SOLUTIONS, INC.

  	
  CENDANT
  TRAVEL DISTRIBUTION

  SERVICES, INC.

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ RALPH E. COMPTON III

  	
   

  	
  By:

  	
  /s/ JEFF HORCH

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Name:

  	
  Ralph E. Compton III

  	
   

  	
  Print:

  	
  Jeff Horch

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  	
  Title:

  	
   

  



 


 


8

















 


 


 ATTACHMENT A
TO


ULTRADIRECT SERVICES SCHEDULE


 


XML
SOFTWARE LICENSE AGREEMENT


 


BY ITS EXECUTION OF THE
ULTRADIRECT SERVICES SCHEDULE TO WHICH THIS XML SOFTWARE LICENSE AGREEMENT IS
ATTACHED (THE “ULTRADIRECT SERVICES SCHEDULE”), CUSTOMER (“LICENSEE”) AGREES TO
ALL OF THE TERMS AND CONDITIONS OF THIS XML SOFTWARE LICENSE AGREEMENT.   ALL CAPITALIZED TERMS USED BUT NOT DEFINED
IN THIS XML SOFTWARE LICENSE AGREEMENT SHALL HAVE THE MEANINGS SET FORTH
ELSEWHERE IN THE AGREEMENT TO WHICH THE ULTRADIRECT SERVICES SCHEDULE IS
ATTACHED AND OF WHICH IT IS A PART.


License.  Pegasus Solutions, Inc., one or more of its
subsidiaries (collectively, “Pegasus”) or their licensors are the sole
owners of the Software (as defined below). 
Other than as set forth in the UltraDirect Service Schedule or the
Master Services Agreement between the parties, the Software licensed hereunder
is licensed on an as is basis without any warranty of any kind.  Other than the license granted herein,
Licensee will not acquire any right, title or interest in or to the Software
pursuant to this XML Software License Agreement or its use of the
Software.  Licensee is hereby licensed
to: (i) use the Software on one or more processors to create, implement and
maintain the UltraDirect Interface; (ii) modify the Software and/or merge it
into other software for Licensee’s use consistent with this XML Software
License Agreement and the UltraDirect Services Schedule, with any portion of
the Software that is so merged continuing to be subject to the terms and
conditions of this XML Software License and the UltraDirect Services Schedule;
and (iii) make copies of the Software for backup purposes only, provided that
each such copy contains all of the restrictive and proprietary notices that
appear on the original version of the Software copied, including the copyright
notice.  Licensee agrees not to use,
copy, or modify the Software or any copy, modification, or merged portion
thereof, in whole or in part, except as expressly provided for in this XML
Software License Agreement.  LICENSEE AGREES NOT TO SUBLICENSE, ASSIGN, OR TRANSFER
THIS LICENSE OR THE SOFTWARE AND THAT ANY ATTEMPT TO DO SO SHALL BE INVALID AND
AUTOMATICALLY TERMINATE THIS LICENSE. 
LICENSEE ACKNOWLEDGES THAT ITS SOLE RIGHTS WITH RESPECT TO THE SOFTWARE
ARE SET FORTH HEREIN.


Termination
of License.  The license
granted pursuant to this XML Software License Agreement is co-terminus with the
UltraDirect Services Schedule unless otherwise terminated pursuant to the terms
hereof.  The license granted hereby to
Licensee will be automatically terminated if Licensee fails to comply with any
term or condition of the Agreement, including this XML Software License
Agreement.  Licensee agrees that upon
termination of the license granted herein it will immediately return to Pegasus
(upon Pegasus’ request) or destroy (and provide certification of such
destruction upon Pegasus request) the Software and all copies, modifications,
and merged portions thereof under Licensee’s control in any form or medium in
which they exist. [


Installation
and Operation.  Pegasus
shall provide (i) documentation relating to the operation of the Software; and
(ii) four (4) hours (including all telephone and non-telephone time) of
customer service support to answer questions concerning the Software.  Except as set forth in the preceding sentence
and the UltraDirect Services Schedule, Pegasus shall have no obligation to
provide services or support to Licensee relating to the Software, including
without limitation any upgrades or enhancements to, or bug fixes for, the
Software.  Licensee and Pegasus agree
that any action of Pegasus in providing upgrades, enhancements or bug fixes to
Licensee shall not constitute a course of dealing, course of conduct or
amendment to this XML Software License Agreement creating a future obligation
to provide the same.


Definition of Software.  As used in this XML Software License
Agreement, “Software” means application software supplied by Pegasus to
Customer that parses and formats data utilizing the Extensible Markup Language
specification, and all modifications and enhancements to, and replacements of,
such software.


 


9














	
  Region:
  circle one

  	
   

  	
   

  	
   

  	
  Pricing Schedule

  
	
  1     2     3     4     5     6     7

  	
   

  	
   

  	
   

  	
  (UltraDirect)

  
	
  8     9     10     11     12     13

  	
   

  	
   

  	
   

  	
   

  



 


 


 


This Pricing Schedule is attached to and a
part of the Master Services Agreement with the Effective Date of __________,
200__, by and between Pegasus Solutions, Inc. and Cendant Travel Distribution
Services Group, Inc.


 


1.             Definitions.  All capitalized terms used in this Pricing
Schedule but not defined herein shall have the meanings set forth elsewhere in
this Agreement.  In addition, the
following definitions shall apply for purposes of this Pricing Schedule:


(a)                               Pricing
Schedule Effective Date means _______________, 200__.


(b)          Billing Period
means the period of time to which a billing statement issued by Pegasus relates.


(c)          UltraDirect Net Reservations means the number of
reservations transmitted through the UltraDirect Interface (as defined in the
UltraDirect Services Schedule) during a particular time period, less the number
of cancellations of reservations transmitted through the UltraDirect Interface
during the same time period.


 


 


2.             UltraDirect Net Reservation Fee.  Pegasus shall pay a Net Reservation Fee for
each Net Reservation processed during that calendar month as follows:


 


	
  Net Reservations

  	
   

  	
  Fee

  
	
  Less
  than or equal to 25,000

  	
   

  	
  (***)

  
	
  25,001-50,000

  	
   

  	
  (***)

  
	
  50,001-100,000

  	
   

  	
  (***)

  
	
  100,001-150,000

  	
   

  	
  (***)

  
	
  150,001-200,000

  	
   

  	
  (***)

  
	
  More
  than 200,000

  	
   

  	
  (***)

  



 


 


3.             Look to Book Transactional
Efficiency.   For any
calendar month in which the Look to Book Ratio as specified in paragraph 3(d)
of the UltraDirect Services Schedule exceeds 1,000:1, then the Net Reservation
fee payable by Pegasus to Customer pursuant to paragraph 2 above with respect
to each Net Reservation processed during such month shall be reduced in accordance
with the following table:


 


	
  Look to Book Ratio

  	
   

  	
  Reduction in Net Reservation Fee

  Payable by Pegasus to Customer

  (Effective Date through
  August 31, 2005)

  	
   

  	
  Reduction in Net Reservation

  Fee Payable by Pegasus to

  Customer

  (September 1, 2005 onward)

  
	
  1,001:1
  but not more than 1,300:1

  	
   

  	
  (***)

  	
   

  	
  (***)

  
	
  1,301:1
  but not more than 1,600:1

  	
   

  	
  (***)

  	
   

  	
  (***)

  
	
  More
  than 1,600:1

  	
   

  	
  (***)

  	
   

  	
  (***)

  



 


If after applying the reduction to the Net
Reservation Fee payable by Pegasus as set forth above results in a negative
amount payable by Pegasus (“Excess Amount”) for that calendar month,  then such Excess Amount shall be applied to
reduce/offset any other amounts owed by Pegasus to Customer under this
Agreement including, but not limited to, any service level credits; provided,
however,  if there is no such other
amount owed by Pegasus to Customer then such Excess Amount will be carried over
and applied to reduce any Net Reservation Fees or other fees payable by Pegasus
to Customer under this Agreement for the following calendar month and each
calendar month thereafter as long an any Excess Amount remains.


 


1

















 


 


4.             Online Distribution Database Download Fee.  If Customer chooses to download to Customer’s
Web Site information in the Online Distribution Database pursuant to paragraph
7 of the UltraDirect Services Schedule, Customer shall pay to Pegasus a
monthly fee as follows:


 


	
  Net Reservations

  	
   

  	
  ODD Download Fee

  
	
  75,000 and greater

  	
   

  	
  (***)

  
	
  Less than 75,000

  	
   

  	
  (***)

  



 


5.             Geo Search and Geo Search Map Fees.


(a)          Annual License Fee. 
If during any calendar year Customer utilizes the Geo Search or Geo
Search Maps functionality or an accessor of Customer’s Web Site transmits a Geo
Search or Geo Search Map request, Customer shall pay to Pegasus an annual
mapping license fee of (***).


(b)          Per Use Fee.  Customer shall pay to Pegasus a fee with
respect to each Billing Period equal to the product of (i) the sum during such
Billing Period of the number of transmissions from Customer’s Web Site of (A)
Geo Search requests, plus (B) Geo Search Map requests, plus (C) requests to (1)
pan, (2) zoom in, (3) zoom out, (4) move up, (5) move down, (6) move right or
(7) move left while viewing the response to any Geo Search Map request;
multiplied by (ii) (***).


(c)          Change in
Fees.  If the per transmission
amount charged to Pegasus by the third party vendor of the Geo Search and Geo
Search Maps functionality is increased, the fee paid by Customer pursuant to
paragraph 5(b) above shall be increased by the same amount.


(d)          Definitions.  For purposes of this paragraph, “Geo Search”,
“Geo Search Maps” and “Customer’s Web Site” have the meanings set forth in the
UltraDirect Services Schedule.


 


6.             Professional Services Fees.


(a)          Implementation.  Customer shall pay to Pegasus a fee of (***)
for Pegasus’ implementation of the Services in accordance with the plan and
schedule of implementation mutually agreed by the parties.  Such fee shall become due and payable from
Customer to Pegasus on the Pricing Schedule Effective Date.


(b)          Other Professional
Services.  Customer shall pay
fees to Pegasus for Pegasus’ performance of professional services (other than
those relating to the immediately preceding subparagraph) at Pegasus’
then-standard hourly rate for such technical and/or professional services (not
to exceed (***) per hour) as specified in the work order, statement of work or
similar document executed by Pegasus and Customer regarding the professional
services performed..


 


7.
                                    Competitive
Pricing.  At all
times during the term of this Pricing Schedule, Pegasus shall provide the
Services pursuant to the UltraDirect Services Schedule to Customer on pricing
terms at least as favorable as the pricing terms applicable for the same
services based on the same scope and scale of the delivery of such services
(e.g., considering any minimum revenue commitments to Pegasus or its
affiliates, contract term and bundled pricing) provided by Pegasus to any
Competitor of Customer.  For purposes
hereof, “Competitor” shall mean an organization that provides online travel
services.


 


8.                                       Term.  This Pricing Schedule shall be effective as
of the Pricing Schedule Effective Date and shall continue in effect thereafter
with respect to each Service that Pegasus provides pursuant to this Agreement
until such time as this Pricing Schedule has been terminated or replaced with
respect to such Service.


 


2

















 


 


	
  PEGASUS SOLUTIONS, INC.

  	
   

  	
  CENDANT TRAVEL DISTRIBUTION
  SERVICES, INC.

  
	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ RALPH E. COMPTON III

  	
   

  	
  By:

  	
  /s/ JEFF HORCH

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Name:

  	
  Ralph E. Compton III

  	
   

  	
  Print:

  	
  Jeff Horch

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Title:

  	
  August 9, 2005

  	
   

  	
  Title:

  	
  August 8, 2005

  



 


3














 


	
  Commission Processing

  
	
  Member Services Schedule

  
	
  (ERTS)

  



 


This Commission Processing Member Services Schedule is
attached to and a part of the Master Services Agreement with the Effective Date
of ____________, 2005, by and between Pegasus Solutions, Inc. (“Pegasus”) and
Cendant Travel Distribution Services Group, Inc. (“Customer”).


 


1.             Definitions.  All capitalized terms used in this Commission
Processing Member Services Schedule but not defined herein shall have the
meanings set forth elsewhere in this Agreement. 
In addition, the following definitions shall apply for purposes of this
Commission Processing Member Services Schedule:


(a)          Commission Processing
Member Services Schedule Effective Date means   _________________, 2005.


(b)          Commission
means a payment owed to Customer for distribution services provided by
Customer, whether such payment is in the form of a percentage commission or
payment, payment of a flat fee or payment of an incentive or override.


(c)          Commission Response
means a record, other than a Participant Commission Record, of the
determination by a Commission payor of the amount due, or of the amount paid by
a Commission payor, to Customer for the sale of a reservation by means of
Customer’s services.


(d)          Electronic Reconciliation
and Tracking is the trade name for Pegasus’ services described in
paragraph 3 of this Agreement


(e)          Member Commissions
means an amount equal to the aggregate Commissions received by Pegasus from all
Participants, less any applicable fees authorized by the Pricing Schedule and
any applicable Taxes.


(f)           Member Commission
Statement means a record of all Participant Commission Records
communicated to Pegasus with respect to a given payment of Member Commissions.


(g)          Participant
means an entity that is subject to an agreement pursuant to which Pegasus
processes such party’s payment of Commissions.


(h)          Participant Commission
Record means a record (i) of the determination by a Participant of
the amount of one or more Commissions due to Customer; and (ii) that is
communicated to Pegasus by such Participant for processing by Pegasus
Commission Processing.


(i)           Payment Period
means the period of time to which a payment of Member Commissions relates.


(j)           Pegasus Commission
Processing is the trade name for Pegasus’ services described in
paragraph 2 of this Agreement


(k)          Underpayment
means the payment to Pegasus by a Participant of funds relating to Pegasus
Commission Processing in an amount less than the amount specified by Pegasus
for such payment.


2.             Pegasus Commission Processing Services.  Pegasus shall, on a weekly basis, or as
otherwise agreed by the parties:


(a)          consolidate by Participant those Participant Commission
Records and Commissions received by Pegasus with respect to the immediately
preceding Payment Period;


                                                (b)           transmit
to Customer the Member Commission Statement relating to the immediately
preceding Payment Period, provided that no Member Commission Statement will be
generated if no Member Commissions are paid; and


(c)          distribute to Customer, in the currency requested by
Customer from a list provided by Pegasus, the Member Commissions relating to
the immediately preceding Payment Period.


Notwithstanding paragraph
2(c) above, Pegasus shall have no obligation to pay to Customer any amount
relating to an Underpayment until Pegasus receives the balance of the
Underpayment from the relevant Participant.


 


1

















 


3.             Electronic
Reconciliation and Tracking Services.  Pegasus agrees to perform the following
services with respect to all Commission payors:


(a)          enter into its Electronic
Reconciliation and Tracking system the following information received from
Customer or third parties: (i) Commission Responses received by Customer; (ii)
Commission Responses received by Pegasus on Customer’s behalf from travel
suppliers that are not Participants; and (iii) payments received by Customer
from Commission payors;


(b)          match reservation information received
by Pegasus from Customer to reservation information received by Pegasus from
Commission payors, and report the Commission Responses that have been received
by Pegasus and that relate to such reservation information;


(c)          based upon information generated by
the process described in paragraph 3(b) above, track overdue Commissions on a
continuing basis and request payment of each overdue Commission for up to 180
days after the end of the month to which the associated reservation relates;
and


(d)          provide
reports to Customer setting forth, in detail and summary form, the information
used in or generated by the processes described in paragraphs 3(a), 3(b) and
3(c) above.


4.             Customer’s
Duties.  Customer shall:


(a)          except for merchant transactions,
refrain from acting to circumvent the processing of Commissions pursuant to
this Commission Processing Member Services Schedule unless otherwise agreed to
between the parties;


(a)          provide Pegasus with all Customer
ARC/IATA numbers, and promptly notify Pegasus of additions and changes to, and
deletions of, such numbers; and


(b)          provide to Pegasus no later than the
fifth (5th) business day after the end of each calendar month or as
otherwise agreed by the parties (i) a file containing all reservation
information relating to such calendar month, such file to designate each such
reservation that is non-commissionable; and (ii) all Commission Responses in
the form of statements, copies of checks or other mutually agreed verification
of payments received directly by Customer from Commission payors.


5.             Affiliates.  The parties agree that, in addition to
Customer, (a) Pegasus shall provide Pegasus Commission Processing and
Electronic Reconciliation and Tracking pursuant to this Agreement to those
Affiliates that are designated in writing by Customer for the provision of such
services; and (b) the terms of this Commission Processing Member Services
Schedule shall be applicable to each designated Affiliate and Customer shall
use commercially reasonable efforts to cause each designated Affiliate to
observe and comply with the same.  Customer  acknowledges that it has the  authority to direct Pegasus to provide
Pegasus Commission Processing and Electronic Reconciliation and Tracking to
each Affiliate designated by Customer for the provision of such services.  Customer shall indemnify, defend and hold
harmless Pegasus and its subsidiaries, and the officers, directors employees
and agents of the same, from and against all losses, claims, liability, costs,
damages, fines, and expenses (including all reasonable legal costs) incurred or
suffered by any of the indemnified parties that arise out of or in connection
with any claim that any of Customer’s Affiliates did not elect to receive the
Services hereunder from Pegasus through Customer.


6.             Additional Terms.  No dispute between Customer and any
Commission payor concerning any Commission shall in any way affect or reduce
the obligations of Customer to abide by the terms of this Commission Processing
Member Services Schedule.  Customer
shall, promptly after receiving notice from Pegasus, repay to Pegasus any
confirmed amounts paid in error to Customer pursuant to this Commission
Processing Member Services Schedule. 
Customer acknowledges that Pegasus incurs costs and risks in converting
currency for the benefit of Customer and agrees that Pegasus may include its
standard margin or markup in the exchange rate to cover these items.


7.             Disclaimer.  Customer agrees that the services to be
rendered by Pegasus pursuant to this Commission Processing Member Services
Schedule are those of a clearinghouse only and, accordingly, (a) Pegasus’
obligation to make payments to Customer is limited to the amount of Member
Commissions actually received by Pegasus, and (b) under no circumstances
shall Pegasus be responsible for collecting Commissions owed to Customer or for
uncollected Commissions due to Customer.


 


2

















 


8.             Term.  This Commission Processing Member Services
Schedule shall be effective as of the Commission Processing Member Services
Schedule Effective Date and shall continue in effect for an initial term of two
(2) years from such date unless terminated earlier as provided in this
Agreement, provided that Orbitz, LLC may terminate this Commission Processing
Member Services Schedule, as it pertains to Orbitz, LLC, at any time after one
(1) year.  The term of this Commission
Processing Member Services Schedule shall thereafter automatically renew for
additional, successive three (3) month terms unless either party provides
written notice to the other party of its intent to terminate this Commission
Processing Member Services Schedule at least ninety (90) days prior to the
expiration of the then current term.


	
  PEGASUS SOLUTIONS, INC.

  	
   

  	
  CENDANT TRAVEL DISTRIBUTION SERVICES GROUP, INC.

  
	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  /s/
  RALPH E. COMPTON III

  	
   

  	
  By:

  	
  /s/
  JEFF HORCH

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Name:

  	
  Ralph
  E. Compton III

  	
   

  	
  Name:

  	
  Jeff
  Horch

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  	
  Title:

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Date:

  	
  August 9,
  2005

  	
   

  	
  Date:

  	
  August 8, 2005

  



 


 


3














 


Pricing
Schedule


Commission
Processing - ERTS


 


 


 


 


This Pricing Schedule is attached to and a
part of the Master Services Agreement with the Effective Date of _____________,
2005, by and between Pegasus Solutions, Inc. and Cendant Travel Distribution
Services Group, Inc.


 


1.             Definitions.  All capitalized terms used in this Pricing
Schedule but not defined herein shall have the meanings set forth elsewhere in
this Agreement.  In addition, the
following definitions shall apply for purposes of this Pricing Schedule:


(a)          Pricing Schedule Effective
Date means ____________________, 2005.


 


2.             Pegasus Commission Processing Services.  For Pegasus’ performance of services pursuant
to paragraph 2 of the Commission Processing Member Services Schedule, Customer
shall pay Pegasus a fee equal to (***) of the total Commissions paid by
Participants to Customer as set forth on the Member Commission Statements.  Costs associated with tapes or diskettes and
other optional services, if any, requested by Customer shall be as agreed to in
writing between the parties. 
Notwithstanding any other provision of this Agreement, the fees and
costs set forth in the preceding sentence, and any Taxes, shall be deducted by
Pegasus from the Commissions paid by Participants to Customer.


 


3.             Electronic
Reconciliation and Tracking Services.  For Pegasus’ performance of services pursuant
to paragraph 3 of the Commission Processing Member Services Schedule, Customer
shall pay to Pegasus:


(a)          (***) of the total
Commissions, with respect to which Pegasus performed the service described in
subparagraph 3(c) of the Commission Processing Member Services Schedule, paid
by Participants to Customer as set forth on the Member Commission Statements;
plus


(b)          (***)
of the total Commissions, with respect to which Pegasus performed the service
described in subparagraph 3(c) of the Commission Processing Member Services
Schedule, paid by Commission payors to Customer as set forth on the reports
described in subparagraph 3(d) of the Commission Processing Member Services
Schedule (other than Member Commission Statements).  (***)


(c)          (i.)           (***)
for each Commission Response received for Orbitz with respect to which Pegasus
performs the service described in subparagraph 3(a) of the Commission
Processing Member Services Schedule; provided that, if Customer fails to
provide Commission Responses as agreed by the parties, Customer shall pay
Pegasus an amount equal to the amount paid by Customer pursuant to this
subparagraph immediately prior to such failure.


               (ii.)          U.S.
Seventy-five Cents ($0.75) for each
Commission Response received for all other affiliates with respect to which
Pegasus performs the service described in subparagraph 3(a) of the Commission
Processing Member Services Schedule; provided that, if Customer fails to provide
Commission Responses as agreed by the parties, Customer shall pay Pegasus an
amount equal to the amount paid by Customer pursuant to this subparagraph
immediately prior to such failure.


 


All fees due pursuant to this paragraph shall be in addition to the
fees and costs set forth in the immediately preceding paragraph, if any, that
are due with respect to the subject Commissions.  Notwithstanding any other provision of this
Agreement, all fees due pursuant to this paragraph shall be deducted by Pegasus
from the Commissions paid by Participants to Customer.


 


4.             Renegotiation of Fees.  If (a) the number of commissionable
reservations set forth on three consecutive Member Commission Statements is
less (***) of the total number of reservations set forth on such Member
Commission Statements, or (b) the average commission rate applicable to the
commissionable reservations set forth on three consecutive Member Commission
Statements is less than (***), then (y) Pegasus and Customer shall promptly
enter into good faith negotiations to amend the preceding paragraph of this
Pricing Schedule entitled “Pegasus Commission Processing Services”


 


1

















 


(and the preceding paragraph entitled “Electronic Reconciliation and
Tracking Services”, if included in this Pricing Schedule) in a mutually
agreeable manner; and (z) in the absence of such an amendment, Pegasus shall
have the right to terminate the Commission Processing Member Services Schedule
sixty (60) days after the commencement of such negotiations.


 


5.             Professional Services Fees.


(a)          Implementation.  Waived.


(b)          Other Professional
Services.  Customer shall pay
fees to Pegasus for Pegasus’ performance of professional services (other than
those relating to the immediately preceding subparagraph (a)) as specified in
the work order, statement of work or similar document executed by Pegasus and
Customer regarding the professional services performed.


 


6.             Term.  This Pricing Schedule shall be effective as
of the Pricing Schedule Effective Date and shall continue in effect thereafter
with respect to each Service that Pegasus provides pursuant to this Agreement
until such time as this Pricing Schedule has been terminated or replaced with
respect to such Service.


 


 


	
  PEGASUS SOLUTIONS, INC.

  	
   

  	
  CENDANT TRAVEL DISTRIBUTION
  SERVICES GROUP, INC.

  
	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ RALPH E. COMPTON III

  	
   

  	
  By:

  	
  /s/ JEFF HORCH

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Name:

  	
  Ralph E. Compton III

  	
   

  	
  Print:

  	
  Jeff Horch

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  	
  Title:

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Date:

  	
  August 8, 2005

  	
   

  	
  Date:

  	
  August 8, 2005

  



 


2