REVENUE MANAGEMENT FOR HIRE AGREEMENT
ESSENTIAL LEVEL
THIS AGREEMENT is made effective as of______[date ]between ______(“Client”) and Six Continents Hotels, Inc. (“SCH”).
In the event of a conflict between the provisions of any attachments hereto and the provisions set forth in this Agreement, the provisions of such attachments shall govern.
Background
A.Client is the______(Ex: GM or Owner) of the hotel known as the______, located at______(Address) (the “Hotel”), and has the authority to enter into this Agreement on behalf of the owner of the Hotel.
B.Client operates the Hotel as a______brand hotel pursuant to the terms and conditions of a license agreement with an affiliate of SCH.
C.SCH operates an Americas RegionRevenue Management Department located at Three Ravinia Drive, Suite 100, Atlanta, Georgia 30346 (“Department”) and has offered to have the Department provide certain revenue management services with respect to the Hotel subject to the terms and conditions of this Agreement. Such services are hereinafter referred to as “Services.” Client wishes to accept and participate in such Services with respect to the Hotel.
1Services.
SCH agrees to perform for Client the services listed below. Recommendations by your RMH Manager may result in modifications to rates, inventory, and yielding strategies in HOLIDEX Plus and/or PERFORM. These recommendations will be discussed with your hotel managers, and on the instructions of the General Manager, Principal Correspondent, or other designated staff member, your RMH Manager will execute all changes in the HOLIDEX Plus and/or PERFORM systems within an agreed time frame. Therefore, active participation from hotel management is required in order to maximize the benefit of Revenue Management for Hire.Client agrees that SCH shall have ready access to Client’s staff and resources as necessary to perform SCH’s services provided for by this contract.
Your RMH Manager will have a standing revenue conference call with your hotel management team. The schedule, based on a 48 week year, will be determined by an RMH Regional Operations Manager. Strategy calls are conducted on a weekly basis on the Premier Level service offering; calls are conducted on a bi-weekly basis on the Essential Level service offering. During the call we will establish short term strategies for the hotel. A follow-up call may take place later in the week to discuss how these strategies have performed. Adjustments to the current strategy may be implemented at this time.
If your hotel qualifies to move to another level of the RMH program at any point during the agreement, you may do so one (1) time per agreement cycle.
Scope of Services includes:
- Discuss short-term selling strategy for Hotel locally (Front Desk, Reservations) and in the HOLIDEX Plus system. Include rates to sell as well as overbooking levels.
- Review short-term Hurdle Points (PERFORM hotels) and authorizations by rate code (all hotels); review Hotel’s short-term HOLIDEX Plus stay restrictions
- Discuss short-term group block cutoff dates
- Monitor competitors’ rates using The Rubicon Group’s Marketvision report
- Analyze denials and regrets
- Review Hotel’s pricing structure, utilizing PERFORM Price Optimization
- Review Hotel’s consumed business versus prior month (monthly)
- Review booking trends through various sales channels (monthly)
- Review booking trends of major accounts and travel agencies (monthly)
- Detailed review of LNR production and budget review (monthly)
- Detailed market segment analysis (yearly)
- Statistical support for marketing plan preparation (yearly)
- Statistical support for budget preparation (yearly)
- Preparation of all price positioning tools available within the IHG “Toolbox”, utilizing Hotel data and publicly-available data
- Coordination of all RFP related activities in conjunction with Hotel (yearly)
- Implementation of all pricing initiatives
2Rate of Payment for Services.
Client agrees to pay SCH for Services in accordance with the schedule contained in either Exhibit A1 or A2, as applicable, attached hereto and incorporated herein by reference. At any time and without cause, SCH may modify the pricing and such modifications shall become effective upon ninety (90) days notice to Client.
3Invoicing.
Client shall pay the amounts agreed to herein upon receipt of invoices which shall be sent by SCH, and Client shall pay the amount of such invoices to SCH. Any fees or other amounts due under this Agreement not received by SCH on or before such invoice is due shall bear interest at the rate of one and a half percent (1.5%) per month, calculated on a daily basis, until paid in full.
4Confidential Information.
Neither party hereto shall disclose to any non-party to the Agreement, any confidential information of such other party. Confidential information is information which relates to the other party’s research, development, trade secrets, marketing plans, or business affairs, but does not include information which is generally known or easily ascertainable by non-parties.
SCH hereby acknowledges that during the performance of this contract, SCH may learn or receive confidential Client information and therefore SCH hereby confirms that all such information relating to the Client’s business will be kept confidential by SCH, except to the extent that such information is required to be divulged to SCH’s clerical or support staff or associates in order to enable SCH to perform SCH’s services under this Agreement or is required to be disclosed pursuant to a subpoena, court order or other applicable law.
5Staff, Use and Hours of Operation.
SCH is an independent contractor and neither SCH nor SCH’s staff is or shall be deemed to be employed by Client. Client is hereby contracting with SCH for the Services described on Exhibit A and SCH reserves the right to determine the method, manner and means by which the Services will be performed. The Services shall be performed by SCH or SCH’s staff, and Client shall not be required to hire, supervise or pay any assistants to help SCH perform the Services under this agreement.
SCH shall not be required to devote SCH’s full time nor the full time of SCH’s staff to the performance of the Services required hereunder, and it is acknowledged that SCH has other Clients within the SCH family of brands. The order or sequence in which the Services are to be performed shall be under the sole control of SCH. Except to the extent that SCH’s Services must be performed on or with Client’s computers or Client’s existing software, and except to the extent specified in Exhibit A, all materials used in providing the Services shall be provided by SCH.
Each of the parties hereto agrees that, while performing Services under this Agreement, and for a period of three (3) months following the termination of this Agreement, neither party will, except with the other party’s written approval, solicit or offer employment to the other party’s employees or staff engaged in any efforts under this Agreement.
SCH shall keep the Department staffed and open for business during normal business hours in the U.S. Eastern time zone, excluding holidays.
6Term of Agreement.
6.1The term of this Agreement shall commence as of , and shall continue for a period of twelve (12) months and expire at the close of business on
, provided that this Agreement is not earlier terminated as more particularly described below (“Initial Term”).
6.2Either party may terminate this Agreement upon providing ninety (90) days prior written notice to the other party.
6.3If Client is participating with a third party intermediary (TPI) that is not certified by SCH, even if Client has obtained a waiver to participate with said non-certified TPI, this agreement shall be terminated upon notice to Client.
6.4In the event of a termination or expiration of the License Agreement between Client and Holiday Hospitality Franchising, Inc., this Agreement shall automatically and without further action or notice on the part of any party hereto, terminate and only Sections 4, 10, 11, 13 and 20 herein shall survive such termination.
6.5After the Initial Term, this Agreement shall automatically renew for additional one year Terms, although either party may terminate this Agreement without cause (a) during a renewal Term, upon 90 days prior written notice to the other party, or (b) upon notice of non-renewal of at least 30 days prior to the end of a Term.
6.6RMH fees are based on annual occupancy for a given hotel; subsequently, the hotel’s annual occupancy will be reviewed at time of renewal to ensure proper cost of service.
7Default.
Any party to this Agreement shall be deemed to be in default hereunder if (a) such party fails to pay any sum due hereunder on or before the fifteenth (15th) day after the invoice mailing date thereof, or (b) such party fails to perform any other obligation hereunder on or before the thirtieth (30th) day following mailing of written notice of such failure by the other party. If the default is not cured within thirty (30) days of the mailing of a termination notice, this Agreement will terminate. Provided, however, that if the non-monetary default at issue is not reasonably susceptible of being cured within such thirty (30) days, such thirty (30) day period shall be extended as reasonably necessary to allow the defaulting party to effect a cure, but in no event longer than a grace period of an additional thirty (30) days. If the defaulting party fails to cure its default within any applicable cure or grace period, the non-defaulting party may terminate this Agreement.
8Use of Work Product.
Except as specifically set forth in writing and signed by both Client and SCH, all work product, whether or not copyrightable or patentable, developed for Client by SCH or utilized solely for Client while performing Services for Client pursuant to this Agreement, shall be the sole and exclusive property of SCH. Client is hereby granted a limited, revocable, nonexclusive license to use and employ such work product within the Client’s business during the term of this Agreement.
9Client Representative.
The following individual ______shall represent the Client during the performance of this Agreement with respect to the services and deliverables as defined herein and shall have the authority to execute written modifications or additions to this contract pursuant to Section 15.
10Taxes.
Any and all taxes, except income taxes of SCH, imposed or assessed by reason of this contract or its performance, including but not limited to sales or use taxes, shall be paid by Client. Client and SCH specifically agree that SCH is not an employee of Client. In the event foreign, federal, state or local taxes are assessed on the Services and SCH has paid for such taxes, Client shall promptly reimburse SCH for all such taxes except for those taxes based on the income of SCH, SCH employees, or personnel provided by SCH pursuant to this Agreement.
11Liability.
SCH warrants to Client that the analysis, data, and services to be delivered or rendered hereunder, will be of the kind and quality described in Exhibit A and will be performed by qualified personnel.
SCH makes no other warranties, whether written, oral or implied, including without limitation, warranty of fitness for purpose or merchantability. In no event shall SCH be liable for special or consequential damages including, but not limited to, ANY DAMAGES RELATED TO the AmOUNTS OF the client’s REVENUE OR PROFITS, either in contract or tort, whether or not the possibility of such damages has been disclosed to SCH in advance or could have been reasonably foreseen by SCH, and in the event this limitation of damages is held unenforceable then the parties agree that by reason of the difficulty in foreseeing possible damages all liability to Client shall be limited to One Hundred Dollars ($100.00) as liquidated damages and not as a penalty.
12Complete Agreement.
This agreement contains the entire agreement between the parties hereto with respect to the matters covered herein. No other agreements, representations, warranties or other matters, oral or written, purportedly agreed to or represented by or on behalf of SCH by any of its employees or agents, or contained in any sales materials or brochures, shall be deemed to bind the parties hereto with respect to the subject matter hereof. Client acknowledges that it is entering into this Agreement solely on the basis of the representations contained herein.
13Applicable Law.
The parties shall each comply with all applicable federal, state and local employment and other laws, government regulations and orders. This Agreement shall be construed in accordance with the laws of the State of Georgia. Venue for any claim, suit, or action for enforcement of any provision of this Agreement shall lie in the state or federal courts located in the State of Georgia, Fulton or DeKalbCounty, to the exclusion of all others.
14Scope of Agreement.
If the scope of any of the provisions of the Agreement is too broad in any respect whatsoever to permit enforcement to its full extent, then such provisions shall be enforced to the maximum extent permitted by law, and the parties hereto consent and agree that such scope may be judicially modified accordingly and that the whole of such provisions of this Agreement shall not thereby fail, but that the scope of such provisions shall be curtailed only to the extent necessary to conform to law.
15Additional Work.
If the parties agree upon additional services to be performed for Client by SCH and upon the additional compensation to be paid to SCH for such additional services, the parties shall both execute a document confirming such terms and such document shall become an amendment to this Agreement.
16Notices.
(i). Notices to Client should be sent to (Address): (if other than hotel)
(ii). Notices to SCH should be sent to: InterContinental Hotels Group, Revenue Management Department, Attention Director of Revenue Management Services,3 Ravinia Drive, Suite 100, Atlanta, GA 30346-2121, with a copy sent by fax to Legal Department (678-894-4128).
17Assignment.
Client shall not assign or otherwise transfer this Agreement or any of its interest in this Agreement without the prior written consent of SCH.Except for the prohibition on assignment contained in the preceding sentence, this Agreement shall be binding upon and inure to the benefits of the heirs, successors and assigns of the parties hereto.
18Illegality of Agreement.
If any provision of this Agreement is declared to be illegal or unenforceable, the remainder of the Agreement shall not be affected by such illegality or unenforceability.
19Exclusivity.
SCH may provide similar services to other hotel owners. Client does not have an exclusive right to receive the Services from SCH.
20Litigation Costs.
In the event of any action, suit or proceeding related to this Agreement, the prevailing party, in addition to its rights and remedies otherwise available shall be entitled to receive reimbursement of reasonable attorney’s fees and costs and court costs.
IN WITNESS WHEREOF, each party hereto has caused this Agreement to be executed by an authorized person as of the date first above written.
SIX CONTINENTS HOTELS, INC.
By (signature): ______
Name: Eric D. Black
Title: Manager-Revenue Management & Business Development
Date:
Company Name:
By (Signature):
Name:
Title: ______
Date: ______
Referred by:______
Once completed please fax the agreement to 678-894-4128 or email to +.
Exhibit A1
Compensation – Revenue Management for Hire
Essential Level
The cost of the service is based upon your 12 months rolling occupancy and room count. If the hotel’s room count is 150 rooms and annual occupancy is less than 75%, the service is offered at $850 per month. This level of service includes a strategy call conducted on a bi-weekly basis.
Given the above statement…client shall compensate SCH at a rate of $850 per month. An invoice will be sent monthly to Client and shall be due fifteen (15) days from the date of such invoice mailing.
SCH shall be reimbursed at actual cost for all necessary and reasonable out-of-pocket travel expenses (if travel is required or requested by Client) incurred by SCH personnel.
Revenue Manager Pay for Performance Plan – Bonus Plan for RM
- The overall goal of RMH is to capture incremental share (RevPAR Index) from the competition. To drive this performance we have included a bonus incentive for the Revenue Manager that works with your property. This incentive is calculated and paid out after the hotel has been on the program for one year. The intention of this incentive is to drive performance by adding an incentive to the Revenue Manager.
Client shall compensate SCH the sum per level of Increase as outlined below. This is measured using a 12 month rolling average beginning with the date the hotel started with program. The measurement begins as of the start date of the Agreement through 12 months and every 12 months thereafter.
The RevPAR Index is determined by the Smith Travel Research (STR) hotel defined comp set.
RevPAR Index0 / <29 / No Pay Out
30 / 69 / Level 1 $100
70 / 89 / Level 2 $100
90 / 99 / Level 3 $150
100 / 105 / Level 4 $200
106 / 109 / Level 5 $200
110+ / $250 per point
*Max payout of Bonus is $1,750
Starting level based on trailing 12 months RevPAR Index. For Hotels without 12 months history, the year-to-date RevPAR Index will be the starting level.
Bonus is paid after participating in Revenue Management for Hire for 12 months.
Please initial regarding the RGI Bonus structure to indicate your agreement.
Hotel Information:
Hotel Inn Code______
Management Company______
Primary Contact Name ______
Primary Contact Phone Number ______
Primary Contact Email ______
General Managers Name______
GM Phone Number______
GM E-Mail______
GM Fax______
Secondary Contact Name______
Secondary Contact Phone Number ______
Secondary E-Mail ______
Once completed please fax the agreement to 678-894-4128 or email to +
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