CONFORMED COPY
OUTSOURCING AGREEMENT
by and among
CENDANT CORPORATION,
CENDANT MEMBERSHIP SERVICES HOLDINGS SUBSIDIARY, INC.,
CENDANT MEMBERSHIP SERVICES, INC.
and
TRILEGIANT CORPORATION
Dated as of July 2, 2001
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TABLE OF CONTENTS
Page
ARTICLE I
LEASE OF ASSETS
Section 1.1. CMS Assets...................................2
Section 1.2. [Intentionally Omitted]......................6
Section 1.3. Retained Liabilities.........................6
Section 1.4. Time and Place of Closing....................7
Section 1.5. Purchase and Sale; Newco Shares..............7
Section 1.6. Deliveries by Cendant........................8
Section 1.7. Deliveries by Newco.........................10
Section 1.8. Business Books and Records..................11
Section 1.9. Post-Closing Arrangements...................11
Section 1.10. Treatment of Cendant Guarantees............11
Section 1.11. Definitions................................12
ARTICLE II
CONTINUING ROYALTY PAYMENTS AND RENTAL PAYMENTS
Section 2.1. Payment of Royalties........................16
Section 2.2. Applicable Membership Club Divestitures.....17
Section 2.3. Payment of Retained Member Income...........18
Section 2.4. Rental Payment for Leased Assets............18
Section 2.5. Payment Statements..........................19
Section 2.6. Interest....................................19
Section 2.7. Term of Revenue Obligations.................19
Section 2.8. No Accord and Satisfaction..................19
Section 2.9. No Withholding..............................20
Section 2.10. Computation, Calculation; Disputes.........20
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF CENDANT
Section 3.1. Organization; Etc...........................20
Section 3.2. Authority Relative to This Agreement........21
Section 3.3. Consents and Approvals; No Violations.......21
Section 3.4. Acquisition of Shares for Investment;
Ability to Evaluate and Bear Risk.........22
Section 3.5. Validity of Shares..........................22
Section 3.6. Assets......................................22
Section 3.7. Availability of Funds.......................23
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Section 3.8. Brokers; Finders and Fees...................23
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF NEWCO
Section 4.1. Organization; Etc...........................23
Section 4.2. Authority Relative to this Agreement........23
Section 4.3. Consents and Approvals; No Violations.......24
Section 4.4. Capitalization; Ownership of Shares.........24
Section 4.5. Acquisition of Shares for Investment;
Ability to Evaluate and Bear Risk.........25
Section 4.6. Newco Acknowledgment........................25
Section 4.7. Brokers; Finders and Fees...................26
ARTICLE V
COVENANTS OF THE PARTIES
Section 5.1. Conduct of Business of Cendant..............26
Section 5.2. Consents; Cooperation.......................26
Section 5.3. Commercially Reasonable Efforts.............27
Section 5.4. Public Announcements........................27
Section 5.5. Tax Matters.................................27
Section 5.6. Knowledge of Breach; Prior Knowledge........28
Section 5.7. Employees; Employee Benefits................28
Section 5.8. Maintenance of Books and Records
by the Parties; Payment Disputes..........31
Section 5.9. Cendant's Trademarks and Logos..............33
Section 5.10. Transfers Not Effected as of Closing.......33
Section 5.11. Further Actions............................34
Section 5.12. Non-Competition Restrictions...............35
Section 5.13. Non Circumvention; Servicing Retained
Active Members by Newco..................36
Section 5.14. Operation of the Business and
Applicable Membership Clubs Following
the Closing Date.........................37
Section 5.15. Non-Solicitation...........................37
Section 5.16. Cooperation on Certain Litigation Matters..37
Section 5.17. Improvements...............................38
Section 5.18. Confidentiality............................39