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CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH
RESPECT TO THE OMITTED PORTIONS.
HOSPITALITY MARKETING CONCEPTS
MARKETING AGREEMENT
This Marketing Agreement ("Agreement") is entered into this 13th day of
January 1995, by and between HOSPITALITY MARKETING CONCEPTS INTERNATIONAL
LIMITED with its seat in West Sussex, England (hereinafter "HMC") and ORBIS
COMPANY INC. (hereinafter "ORBIS")
PREAMBLE
WHEREAS, HMC has the expertise and experience in the organization,
advertisement, research, promotion and development of hotel and hospitality
marketing Programmes, as that term is hereinafter defined; and
WHEREAS, ORBIS is in the business of offering to the general public
lodging, recreational and restaurant facilities, including related services; and
WHEREAS, HMC, ORBIS and the participating ORBIS HOTELS are desirous of
entering into an agreement whereby HMC will act as the exclusive marketing
representative, of Club ORBIS as describes hereinbelow, of the participating
ORBIS HOTELS to market and promote the facilities and services hereafter
described, within the Territory as defined under the terms and conditions set
forth hereinbelow.
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CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH
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AGREEMENT
THEREFORE, in consideration of the premises and the mutual promises,
covenants and agreements herein contained, it is agreed by and between HMC,
ORBIS and the participating ORBIS HOTELS as follows:
1. DEFINITIONS
(A) The preamble of this Agreement shall form an integral part hereof.
(B) Unless otherwise specified by subject and content, the words appearing
in the first column of the following table whenever used within this Agreement
shall bear the meanings set opposite them, respectively, in the second column
thereof:
Agreement Term The period beginning on the day in which this
Agreement becomes effective and continuing until
this Agreement is terminated as provided herein.
Club Name The name appearing on all the collateral material
relating to the Membership Programme and the
plastic membership card described herein.
Execution Date The date of the execution of this Agreement as
first written above.
Active Programme A Marketing Programme that is actively selling
memberships.
HMC SP. Z 0.0. The legal entity which shall be established by HMC
for realisation of this Agreement and to which all
rights and obligations of HMC under this Agreement
shall be assigned.
Gross Receipts All membership fees generated by the Programme,
less all amounts paid for VAT or other similar
tax.
ORBIS S.A. The legal entity entering into this Marketing
Agreement with HMC.
Marketing Programme The telemarketing operation implemented by HMC on
behalf of ORBIS to promote and sell Membership
Cards.
Membership Programme The granting of the right to use the facilities of
ORBIS under the "Club" name specified herein.
Member(s)/Membership Those individuals who purchase the Membership
Programme described herein and are holders of
Membership Cards.
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CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH
RESPECT TO THE OMITTED PORTIONS.
Membership Date The date of the purchase of the Membership Card by
Member.
Membership Term The period beginning on the Membership Date and
continuing for twelve (12) to thirteen (13)
consecutive months thereafter.
Membership Card The plastic identification card issued in
connection with the purchase of the Membership for
the Membership Programme described herein.
Membership Agreement The agreement under which a person becomes a
member.
Proprietary Information Any and all information of a secret or
confidential nature arising in relation to the
hotel marketing programmes of HMC, including but
not limited to brochures, promotional literature,
marketing materials, club membership agreements,
club membership cards and all other products
related, similar to or derived from the membership
programme, any idea, date, knowhow, technique,
formula, method process, use, composition,
product, invention, trade secret or other
technical, business, financial customer or product
development plans, forecasts or strategies and the
names and expertise of employees and consultants,
whether or not any such information can be
patented, trademarked, copyrighted or enforceable
as a trade secret under the laws of any nation.
Sales Reports Financial and accounting reports sent to ORBIS on
a weekly basis.
The Territory All domestic markets.
2. MEMBERSHIP CARDS
HMC shall print or cause to be printed Membership Cards bearing the title
ORBIS GOLD CLUB for the Membership Programme. HMC shall [REDACTED*] all design,
preproduction, and manufacturing costs incurred relating to the production of
the Membership Cards [REDACTED*]. Each Membership Card shall be valid and
honored by each participating ORBIS hotel for the Membership Term.
Prior to the initial distribution of Membership Cards to Members, HMC shall
provide to ORBIS all plans, designs, and artwork on the proposed Membership
Card. ORBIS shall, within ten (10) days of receipt of the proposed Membership
Card, provide written notice to HMC that the proposed Membership Card has met,
or rails to meet, the product quality control standards of ORBIS. In the event
HMC does not receive written notice of acceptance or rejection of the proposed
Membership Card, the plan, design, and artwork of the Membership Card will be
presumed to meet the minimum product quality control standards of ORBIS, and
will thereafter
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CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH
RESPECT TO THE OMITTED PORTIONS.
be produced in such form and distributed to those entitled under this Agreement
to Membership Cards.
3. COMPLIMENTARY MEMBERSHIPS
ORBIS shall be entitled to [REDACTED*] Membership Cards free of charge for
each participating ORBIS hotel. The [REDACTED*] promotional Membership Card, and
each promotional Membership Card thereafter, will be distributed at a cost to
the requester of [REDACTED*] of such Membership Card.
4. MARKETING MATERIALS
Substantially contemporaneous with the production of the Membership Cards
but not before, HMC shall produce marketing materials, including, but not
limited to, marketing literature, promotional materials and advertisements for
the Membership Programme [REDACTED*]. ORBIS has the right to review all
materials produced by HMC relating to the packaging, promotion and marketing of
ORBIS.
Prior to the distribution of marketing materials to the general public, HMC
shall provide ORBIS with copies of the proposed marketing material or
advertisement. ORBIS shall, within then (10) days of receipt of the proposed
marketing material, provide written notice to HMC that the proposed standards of
ORBIS. In the event HMC does not receive written notice of acceptance or
rejection of the proposed material within ten (10) days of receipt of said
material, the plan, design and artwork of the material will be presumed to meet
the minimum product quality control standards of ORBIS, and will thereafter be
distributed to the general public.
5. MEMBERSHIP TERM
Each Membership Card sold by HMC shall be valid for the Membership Term.
Each Member shall be entitled to those privileges specified on the Membership
Card and marketing materials, subject to all limitations, restrictions, and/or
disclaimers contained in such materials.
Membership Cards shall have no cash value or redemption value, unless
specifically stated on the Membership Card to have said value.
6. RESTAURANT DISCOUNT
All restaurants at participating ORBIS hotels shall honor the Membership
Card for a minimum of two (2) persons with no maximum restrictions. A Member
shall receive a [REDACTED*] discount on the total food purchased by the Member
and one guest; a [REDACTED*] discount shall be given to a Member and two guests;
a [REDACTED*] discount shall be given to the Member with three guests; and the
discount shall continue as set forth above, pro-rata, depending upon the number
of guests that accompany the Member.
The participating hotel restaurants shall accept payment in any acceptable
form for the total food bill, after crediting the Member with the applicable
membership discount. All food
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CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH
RESPECT TO THE OMITTED PORTIONS.
purchase during the participating restaurant's Membership Programme hours are to
be ordered form the restaurant's regular menu, including any and all special
menus, attachments, or "clipons".
The amount of the discount shall be exclusive of (a) alcoholic/non-
alcoholic beverages; (b) taxes (if applicable); (c) orders made off-premises
or through room service; (d) discounted dining specials or hotel promotions
independent of participating hotel's Marketing Programme.
Participating ORBIS hotels shall have the sole responsibility for providing
services and maintaining the facilities to provide the benefits described in
ORBIS CLUB Membership Programme. payments for any of the services or facilities
offered to any Member shall be made directly to the participating ORBIS outlet.
It shall be the sole responsibility of the participating ORBIS outlet to satisfy
itself as the payment for such services or facilities and under no circumstances
shall HMC be liable to ORBIS or any participating ORBIS outlet for any payment
for such services or facilities.
HMC shall not be responsible for the refusal of a Member to honor
obligation to pay for lodging, food or services provided by the ORBIS hotels.
7. ORBIS COMPENSATION
In consideration of ORBIS's participation, in the Marketing Programme,
ORBIS shall receive [REDACTED*] as more particularly set forth in the expense
schedules, which are attached hereto and marked as Attachments C and D which are
incorporated by this reference as though fully set forth herein.
8. HMC COMPENSATION
All payments for memberships shall be remitted directly to HMC. The term
"payments" as used herein includes payments made in cash, vouchers, caulks,
debit cards, credit cards, including, but not limited to, Cakes, Visa, Diner's
Club, Carte Blanche, and American Express. Said payments will be processed by
HMC on a weekly basis.
9. ACCOUNTING AND REPORTING
Complete and accurate records concerning monetary transactions will be
maintained on each Membership Card purchased. HMC will diligently record and
report the following information:
(a) date and amount of each Membership Card sold;
(b) an itemization of operating expenses;
(c) the name and account number of the payer;
(d) date and amounts of costs to be refunded to HMC for cancellations or
refunds;
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CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH
RESPECT TO THE OMITTED PORTIONS.
(e) dates and payments of customer payments as well as refunds;
(f) records concerning any returned caulks.
Monetary transactions are to be reported on a weekly basis, within three
(3) working days of the last day of each, week (Sunday).
HMC shall, within thirty (30) working days of ORBIS's receipt of the weekly
Sales Reports and related documentation, pay to ORBIS an amount [REDACTED*].
10. HOTEL FACILITIES
ORBIS shall provide various office and lodging facilities free of charge or
at an agreed charge as more precisely set forth in attachment D.
11. MANAGEMENT INFORMATION SYSTEMS
As the exclusive marketing representative of the ORBIS CLUB HMC will
require certain specific information concerning ORBIS and its participating
hotels so that HMC can market an promote the facilities and services of said
hotels. Therefore, on the request of HMC, ORBIS or the participating hotel shall
provide HMC with information regarding its room accommodations, dining
facilities, and services as HMC may reasonably request during the term of this
Agreement.
ORBIS and the Participating ORBIS Hotels shall provide HMC with duly
completed vouchers for usage tracking purposes to enable HMC to provide
Management Information Services to ORBIS as provide herein below.
HMC shall provide ORBIS with monthly Member tracking reports providing
ORBIS and the Participating ORBIS Hotels return F&B and rooms tracking vouchers
as provided for in this Agreement.
12. MEMBERSHIP CANCELLATIONS
Members shall have [REDACTED*] the receipt of their Membership Card to
cancel and receive a full refund providing they return all membership material
as outlined in the Membership Agreement. If a Member wishes to cancel after the
[REDACTED*] period, the HMC shall seek ORBIS's approval before issuing such as
refund. Such approval shall not be unreasonable withheld by ORBIS. Any
cancellation or refund resulting from poor service, failure to honor the
Agreement, or resulting from the conduct of ORBIS, or its agents and employees
shall be the liability of ORBIS. Therefore, cancellation incurred directly by
HMC shall be entitled to the compensation, as described herein, notwithstanding
the refund, replacement or cancellation.
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CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH
RESPECT TO THE OMITTED PORTIONS.
13. INDEMNIFICATIONS
ORBIS shall defend HMC and its representatives against all financial claims
of third parties and shall reimburse HMC and its representatives for all
justified costs and damages awarded by a final court decision (including but not
limited to legal fees and court costs) relating to any failure of ORBIS to
provide Members with the benefits conferred by the Membership Programme.
HMC shall reimburse ORBIS and its representatives for all justified costs
and damages related to the default realisation of HMC obligations under this
Agreement.
14. MARKETING OF MEMBERSHIP PROGRAMME
HMC shall advise each prospective Membership Programme purchase of the
benefits to be derived from becoming a Member, subject to the conditions and
limitations contained herein.
15. PROMOTION OF MEMBERSHIP PROGRAMME
A) In promoting and marketing the Membership Programme, HMC shall use its
best efforts to sell a minimum of [REDACTED*] memberships annually each year of
this Agreement for the participating ORBIS HOTELS in Poland. The sale of the
minimum number of memberships, as set forth above, is the target, goal,
objective (hereinafter "objective") of the parties hereto, and it shall not be
considered a breach of this agreement should HMC not achieve the mutually agreed
upon objective. The above annual goal is based on the participation of
[REDACTED*] ORBIS Hotels and may change from year to year of this Agreement
depending on the number of Participating ORBIS Hotels, which number may be
changed by ORBIS.
B) HMC with the cooperation of ORBIS shall establish eight (8) regional
active Programmes in certain cities to sell and promote Memberships of CLUB
ORBIS. The anticipated duration of the selling and marketing of the Membership
Programme at each ORBIS HOTEL regional marketing location is [REDACTED*] from
the time HMC staff arrive at the ORBIS HOTEL regional marketing location. It
shall be within HMC's sole discretion to terminate the selling and marketing of
the Membership Programme only after the objective, as set forth in Paragraph A
above, has been attained. The election to terminate the selling and marketing
in a regional active Programme concludes the sales and marketing of the
Membership Programme only for the given contract year. In no event shall this
provision be interpreted to mean that this Agreement is terminated. This
Agreement may only be terminated as set forth hereinbelow.
C) The provision for further promotion and marketing by HMC for the
renewal of the Membership Programme shall commence not earlier than four (4)
weeks from the expiration of the earliest Membership Term. At the commencement
(or as soon thereafter as the HMC staff can arrive at the Regional Location) of
the second year, and each succeeding year thereafter, in which this Club
Agreement is in force, a new selling and marketing period of [REDACTED*] shall
take place. The terms and provisions of Paragraphs A and B above shall apply
with each new annual selling and marketing period.
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CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH
RESPECT TO THE OMITTED PORTIONS.
16. TERMINATION
This Agreement shall remain in effect for a period of [REDACTED*] from the
date of its execution and shall be automatically renewed thereafter for
[REDACTED*] periods. Either party to this Agreement may terminate the Agreement
at the end of each period by giving not less than ninety (90) days written
notice to the following addresses:
HOSPITALITY MARKETING CONCEPTS ORBIS COMPANY INC
15751 Rockfield Boulevard 16 BRACKA STR.
Irvine, California 92716 USA 00-028 WARSAW
POLAND
If Agreement is terminated: -
(a) by HMC then ORBIS shall not within the Territory be involved, engaged,
concerned or interested or promote any programme which is the same or
similar to the Membership Programme until the expiration of the validity of
the last Membership sold under this Agreement.
(b) by ORBIS or by a participating hotel or by mutual consent then ORBIS
and the participating hotels covenant that they will not jointly or
severally within the Territory be involved, engaged, concerned or
interested or promote any programme which is the same or similar to the
Membership Programme for a period of [REDACTED*] from the expiration of the
validity of the last Membership sold under this Agreement.
17. ORBIS COVENANTS
ORBIS hereby covenants with HMC that it will not at any time directly or
indirectly:-
(a) Disclose or permit to be disclosed any Proprietary Information.
(b) Utilise or allow to be used any Proprietary Information for its own
benefit or for the benefit of any other person or persons or in a manner
which might cause loss or be detrimental to HMC.
(c) Within The Territory be involved, engaged, concerned or interested in
any other business or course of conduct in respect of which use or
disclosure of Proprietary Information could arise.
(d) Without the express written consent of HMC extend the validity of the
Membership Card.
For the avoidance of doubt, all Proprietary Information remains at all
times during the course of and subsequent to the termination of this Agreement
the exclusive property of HMC.
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CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH
RESPECT TO THE OMITTED PORTIONS.
18. HMC COVENANTS
HMC covenants with ORBIS that it will not sell or promote a similar or same
Membership Programme in cities in Poland where a Participating ORBIS Hotel may
exist as long as this Agreement is in force.
In addition, HMC covenants with ORBIS that it will not disclose to any
third party any information regarding ORBIS's turnover, occupancy rates and all
financial information delivered to HMC by ORBIS or ORBIS hotels participating in
the Programme and any other information, which will be named as confidential by
ORBIS or ORBIS hotel participating in the Programme.
19. ASSIGNMENT
This Agreement, and those rights granted hereunder, will bind and inure to
the benefit of the successors and assigns of the parties. HMC may assign this
Agreement to another HMC company upon thirty (30) days written notice to ORBIS.
20. SEPARATION OF PROVISIONS
Each provision of this Agreement is separable and if any other provision is
determined to be invalid, no other provision of this Agreement shall be affected
and shall remain in full force and effect.
21. PREVIOUS AGREEMENT
This Agreement supersedes all previous agreements, written or oral, between
the parties hereto and may be modified only by the written mutual agreement of
the parties.
22. NOTICES
All notices required to be sent by either party to this Agreement to the
other shall be sent by registered or certified mail to the respective addresses
listed in paragraph 16, hereinabove.
23. LAW AND LITIGATION
This Agreement shall be governed by Polish law, in any and all matters,
such as interpretation, meaning and construction of this Agreement. If either
party hereto brings an action to enforce the terms hereof or to declare rights
hereunder, the prevailing party in such action shall be entitled to an award of
reasonable costs of litigation, including legal fees, in such amount as may be
determined by the court having jurisdiction in such action.
24. JOINT VENTURE
This Agreement shall neither constitute a Joint Venture Agreement between
HMC and ORBIS nor a Joint Venture Agreement between HMC and the participating
ORBIS hotels for the marketing and sale of the Membership Programme.
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OMITTED AND FILED SEPARATELY WITH THE COMMISSION.
CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH
RESPECT TO THE OMITTED PORTIONS.
25. EMPLOYEES
HMC and ORBIS confirm and agree that throughout the Agreement Term and for
a period of [REDACTED*] thereafter neither party hereto shall solicit, entice or
procure the employee of the other party hereto.
26. COUNTERPARTS
This Agreement may be executed in counterparts.
27. THE EFFECTIVE DATE OF THIS AGREEMENT
This Agreement shall become effective on the day of registration by the
respective court for commercial cases of the company HMC Poland Spolka z o.o.
and the assignment by HMC to HMC Poland Spolka z o.o. all rights and obligations
under this Agreement, which shall be notified by HMC to ORBIS in writing.
28. ATTACHMENTS
The following documents attached to this Agreement are hereby incorporated
herein by this reference and shall form an integral part hereof.
A- SERVICES, FACILITIES, AND MEMBERSHIP BENEFITS/INCENTIVES
B- LIST OF PARTICIPATING HOTELS
C- EXPENSE SCHEDULE PROGRAMME
D- EXPENSE SCHEDULE ORBIS FACILITIES
E- "ORBIS GOLDEN CLUB" PLAN
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the day and year first written above.
HMC
BY: /s/
-------------------------
ITS:
ORBIS
BY: /s/
-------------------------
ITS:
BY: /s/
-------------------------
ITS:
This constitutes a fair and accurate
English translation of the underlying
agreement
By: /s/ Philip G. Hirsch
--------------------------------
Philip G. Hirsch
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CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH
RESPECT TO THE OMITTED PORTIONS.
MARKETING AGREEMENT ATTACHMENT A
SERVICES, FACILITIES AND, MEMBERSHIP BENEFITS
ORBIS engages HMC to promote and market the following restaurants and Hotel
services:
A. ORBIS PARTICIPATING HOTEL dining facilities:
[REDACTED*] in all the restaurants of the ORBIS during their regular
opening hours subject to exclusions and limitations contained in paragraph
6 of the Marketing Agreement.
B. Room incentive and benefits:
1. [REDACTED*] off published rates or best available public rates upon
presentation of a valid Membership Card valid all week. Transferable
bookings allowed subject to space availability restrictions. Member
need not to be present at time of his/her guest check-in to qualify
for the above rates.
2. [REDACTED*] in a double room at any participating ORBIS Hotel,
breakfast not included. Valid Friday, Saturday, or Sunday nights.
Nontransferable, subject to availability and prior reservations. This
benefit is provided upon presentation of a voucher to be given to each
Member of the Club.
C. Conference benefits:
1. [REDACTED*] off normal space rental fee on weekdays, Monday through
Friday.
2. [REDACTED*] of normal space rental fee on weekends, Saturday & Sunday.
Above conference benefits are subject to availability and prior
reservations. Not valid for Food and Beverage services.
D. Membership Cards will not be honored on the following dates: New Year's Eve
and New Year's Day/
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CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH
RESPECT TO THE OMITTED PORTIONS.
MARKETING AGREEMENT ATTACHMENT B.
LIST OF PARTICIPATING HOTELS
LIST OF PARTICIPATING ORBIS HOTELS IN POLAND
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CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH
RESPECT TO THE OMITTED PORTIONS.
MARKETING AGREEMENT ATTACHMENT C.
EXPENSE SCHEDULE
As used in the Marketing Agreement, The term "Operating Expenses",
including but is not limited by the following:
A. A fee for services of [REDACTED*]. Programme Management bonuses and
incentives not to exceed [REDACTED*]. The Programme Manager and Assistant
Programme Manager round trip transportation to the Programmes. Assistant
Managers as required [REDACTED*].
B. When and if deemed necessary by HMC for the benefit of the Programmes on
Operations Manager will be placed into the Programmes and charged as an
Operational Expense at a fee of [REDACTED*] plus travel expenses.
C. [REDACTED*]
D. [REDACTED*] for the financial management of the Programme of Audits as may
be required by Government authorities or ORBIS accountants or legal
representatives.
E. [REDACTED*]
F. [REDACTED*]
G. [REDACTED*]
H. [REDACTED*]. Services listed in this item may be provided by HMC.
I. [REDACTED*]
J. [REDACTED*] will be charged to the Marketing Programme for tracking and
Management Information Services.
K In addition to standard telephone and printing reserves, HMC will withhold
and a weekly basis during the Marketing Programme [REDACTED*] as reserve to
cover contingencies and cancellations. A final audit will be performed
ninety (90) days after the conclusion of the Marketing Programme at which
time remaining funds will be distributed according to the Agreement.
L. Other expenses as mutually agreed to in writing by both parties.
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CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH
RESPECT TO THE OMITTED PORTIONS.
MARKETING AGREEMENT ATTACHMENT D.
EXPENSE SCHEDULE
In each of the eight (8) regional Marketing Programme HMC will required
office and lodging facilities, which HMC agrees to pay for, as a Programme
expense, where required at a substantial reduction to be negotiated with each of
the ORBIS hotels participating in the Programme, but in any case a lodging rate
shall [REDACTED*]. All charges paid for facilities whether to ORBIS or a
participating ORBIS Hotel or and outside suppler shall be deemed [REDACTED*].
HMC will also require about 12 telephone lines and instruments in each
location that ORBIS may supply or help arrange the supply of such lines and
instruments. [REDACTED*].
The following facilities and services will be required in each of the eight
location:
(a) ORBIS shall provide or arrange for office space, with a minimum of
about fifty (50) square meters with windows. Said office space will be
utilized by HMC over the selling and marketing of the Membership
Programme as set forth in Paragraph 15 above, and must be adequate to
sustain up to twenty (20) telemarketing stations, secretarial space
and a storage area for filing and ancillary materials;
(b) Two single sleeping rooms which will serve as the residence of the
Programme Manager and Assistant Programme Manager during the term of
the promotion of the Membership Programme as set forth in paragraph 16
above;
(c) Such photocopies as are reasonable required to enable HMC to
adequately run the programmes and furnish ORBIS with the details of
weekly and daily reports and other required information. [REDACTED*].
(d) Meals for HMC Corporate Management and the Programme Manager,
Assistant Programme Manager, and Programme Secretary in the Hotel
staff canteen, restaurants, or room Service at [REDACTED*], except for
meals at the staff canteens. [REDACTED*].
All other expenses incurred by HMC in providing the services herein
specified shall be deemed [REDACTED*], as set forth in the attachments hereto,
which are hereby incorporated herein by this reference.
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