NON-COMPETITION AGREEMENT

NON-COMPETITION AGREEMENT





AMR CORPORATION



AMERICAN AIRLINES, INC.



TSG CORPORATION





THE SABRE GROUP, INC.



Dated: July 1, 1996







Non-competition Agreement







NON-COMPETITION AGREEMENT



TABLE OF CONTENTS





Section Page

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RECITALS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1



1 DEFINED TERMS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1



2 TERM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

2.1 Termination Due to Acquisition of TSGH or TSG . . . . . . . . . . . . . . . . . . . . . . . . . . 1

2.2 Effect of Termination of IT Services Agreement . . . . . . . . . . . . . . . . . . . . . . . . . 2



3 GEOGRAPHIC AREA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2



4 NON-COMPETITION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2



5 PERMITTED ACTIVITIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

5.1 Permitted Electronic Travel Distribution . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

5.2 Prohibited Use of ETDS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

5.3 Response to Actions by Air Carrier Competitors . . . . . . . . . . . . . . . . . . . . . . . . . 4

5.4 Software Licensing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

5.5 AMR Services Subsidiaries Excluded . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4



6 THIRD PARTY SUPPLIERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

6.1 Endorsement of Third Party Products or Services . . . . . . . . . . . . . . . . . . . . . . . . . 5



7 AIRLINE ALLIANCES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5



8 OTHER ACQUISITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5



9 EXTENDED DISPOSITION PERIOD . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5



10 DISPOSITION OF SUBSIDIARY EQUITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6



11 PARTICIPATION IN INDUSTRY ORGANIZATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6



12 REPRESENTATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6



13 LIMITS OF LIABILITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6



14 REMEDIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7











Non-competition Agreement i 15 NO ASSIGNMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7



16 MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

16.1 Additional Representations and Warranties . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

16.2 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

16.3 Binding Effect . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

16.4 Integration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

16.5 No Third Party Beneficiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

16.6 Waiver . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

16.7 Multiple Originals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

16.8 Invalidity of Provisions/Blue Penciling . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

16.9 Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

16.10 Dispute Resolution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

16.11 Choice of Forum . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

16.12 Compliance with Laws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10



Attachments



APPENDIX A Defined Terms APPENDIX B Dispute Resolution Procedures











Non-competition Agreement ii NON-COMPETITION AGREEMENT



This Non-competition Agreement (together with the attachments hereto, the "Agreement") is made and entered into as of July 1, 1996, by and among AMR Corporation, a Delaware corporation ("AMR"), American Airlines, Inc., a Delaware corporation ("American"), TSG Corporation, a Delaware corporation ("TSGH"), and The SABRE Group, Inc., a Delaware corporation ("TSG").





WHEREAS, this Agreement is ancillary to, and represents part of the consideration under, the IT Services Agreement and the Marketing Cooperation Agreement, each dated July 1, 1996, between American and TSG; and



WHEREAS, TSG conducts the TSG Business, and AMR and American formerly conducted the TSG Business, on a world- wide basis; and



WHEREAS, AMR believes that in order to promote and protect the TSG Business, it is in the best interests of AMR, as the common parent of American and TSGH, to limit the ability of American and other AMR Subsidiaries to Compete with the TSG Business; and



WHEREAS, the Parties recognize that TSG and its Affiliates are also currently subject to the ENCOMPASS Non- Competition Agreement;





NOW, THEREFORE, in consideration of the mutual covenants and undertakings set forth herein and in the IT Services Agreement and the Marketing Cooperation Agreement, the Parties hereto agree as follows:



1 DEFINED TERMS Capitalized terms used and not otherwise defined herein shall have the meanings assigned to such terms in Appendix A. This Agreement shall be interpreted in accordance with the rules of interpretation contained in Appendix A.



2 TERM This Agreement shall be effective as of the Effective Date and shall continue in effect until December 31, 2001, unless this Agreement is terminated sooner as provided elsewhere herein.



2.1 Termination Due to Acquisition of TSGH or TSG This Agreement may be terminated by American and AMR if American gives notice of termination of the IT Services Agreement under Section 24.5 of that agreement, subject to the requirement that American provide











Non-competition Agreement 1 ninety (90) days Notice to TSG that it also intends to terminate this Agreement and provided that this Agreement shall not terminate unless the IT Services Agreement shall also terminate.



2.2 Effect of Termination of IT Services Agreement If the IT Services Agreement is terminated by American as a result of an Egregious Breach or an SLA Termination Event (as those terms are defined in that agreement) by TSG under that agreement, then this Agreement shall continue in force but shall cease to apply to, and each of the Restricted Persons may thereafter engage in, the activities described in clauses b., c., d. and e., of the definition of TSG Business contained in Appendix A.



3 GEOGRAPHIC AREA The terms and conditions of this Agreement apply to all of the activities world-wide of each of TSGH, TSG and the Restricted Persons.



4 NON-COMPETITION Except as permitted under Section 2.2 or Section 5, after the Effective Date and during the term of the Agreement, unless TSGH or TSG has given its Consent, each of AMR and American shall not, and shall cause the Restricted Persons not to, Compete with the TSG Business in any of the following ways:



4.1 Through a directly-owned business or business unit that

Competes with the TSG Business.



4.2 Through a Subsidiary that Competes with the TSG Business.



4.3 Through active participation in the management of any

Person that derives more than $50 million or 20% of its

total revenues, whichever is less, from business

activities that Compete with the TSG Business.



4.4 Through direct ownership, or indirect ownership through

one or more Persons, of more than 5% in the aggregate of

the equity ownership of a Person that derives more than

$50 million or 20% of its total revenues, whichever is

less, from business activities that Compete with the TSG



4.5 Through direct ownership, or indirect ownership through

one or more Persons, of more than 5% in the aggregate of

any class of the equity ownership of a Person which class

reflects a participation in the revenues or profits of a

business unit that derives more than $50 million or 20% of

its total revenues, whichever is less, from business

activities that Compete with the TSG Business.



4.6 Through any understanding, commitment, agreement or

contractual arrangement with any Person which is likely to

have the same economic effect as the equity ownership

described in Section 4.4 or Section 4.5.











Non-competition Agreement 2 5 PERMITTED ACTIVITIES Notwithstanding the restrictions in Section 4, and except as provided herein or as the Parties may otherwise agree in writing, each of the Restricted Persons may engage in the activities permitted by Section 5.1, Section 5.3, Section 5.4 and Section 5.5, and in any Permitted Activity that might otherwise Compete with the TSG Business.



5.1 Permitted Electronic Travel Distribution The Restricted Persons may develop, maintain, manage, market and provide an Electronic Travel Distribution System as set forth in this Section 5.1.



(a) American Airlines Reservations Systems American may

develop, maintain, manage, market and provide an ETDS for and/or to

third parties, subject to the requirements that any such ETDS: (i)

must be branded using the name "American Airlines" and/or the name of

an airline marketing alliance in which American participates and which

involves an exchange of passenger or cargo traffic; (ii) if provided

directly to Travel Purchasers (i.e., not by an Intermediary), must (A)

apply a minimum 90 minute penalty in its availability displays to Air

Carrier services that Compete with AA Flights and (B) favor AA Flights

in all other displays that include multiple Air Carriers; and (iii) if

provided indirectly to Travel Purchasers (i.e., by an Intermediary),

must (A) apply a minimum 360 minute penalty in its availability

displays to Air Carrier services that Compete with AA Flights, (B)

favor AA Flights in all other displays that include multiple Air

Carriers and (C) be provided to Travel Purchasers without modification

or enhancement of the information or software provided by American to

the Intermediary.



(b) Travel Agents Notwithstanding the foregoing paragraph

(a), the Restricted Persons shall not market or provide any ETDS

described in this Section 5.1 to any Travel Agent if that Travel Agent

has during the preceding six calendar months generated twenty-five

percent (25%) or more of its total bookings through the SABRE system

(for this purpose the SABRE System does not include any ETDS provided

by American). The Restricted Persons may own, manage, control or

participate in the business of a retail travel agency that is not a

CRS or CRS owner and may use in such business any ETDS, whether

provided by TSG or by any third party.



5.2 Prohibited Use of ETDS With regard to any ETDS described in Section 5.1, the Restricted Persons shall not: (a) permit or facilitate the use of software that would allow the use of any such ETDS in a manner contrary to Section 5.1, nor (b) permit or facilitate any Person's use of any such ETDS or information provided by or through any such ETDS in a manner contrary to Section 5.1. If TSG or any Restricted Person learns that an ETDS described in Section 5.1 is being used in a manner not permitted by Section 5.1, then the Restricted Persons shall cooperate with TSG at the expense of the Restricted Person providing that ETDS to cause such impermissible use to be terminated, including, if technologically feasible and economically practicable, blocking any further such use.











Non-competition Agreement 3

5.3 Response to Actions by Air Carrier Competitors Subject to the restrictions in Section 7 and Section 8, if any Air Carrier that Competes with American engages in an activity in connection with such Air Carrier's Transportation Business, and if the restrictions imposed upon American under this Agreement would prevent American from engaging in the same activity and, in American's sole judgment, would be likely to place American at a disadvantage in Competing against such Air Carrier in the Transportation Business, then American may engage in such activity subject to the following requirements: (i) prior to engaging in such activity, American shall give TSG a Notice containing a description of the nature and scope of the activity in which American proposes to engage in order to alleviate such competitive disadvantage; (ii) American shall consult with TSG within ten (10) days after such Notice concerning measures and/or compensation that may be appropriate in order to mitigate, to the extent possible, the adverse impact of such American activity on the economic expectations of TSG under this Agreement while still alleviating such competitive disadvantage to American. If American and TSG are unable to agree upon appropriate measures and/or compensation, then American may engage in such proposed activity and the issue of what, if any, compensation to TSG may be appropriate shall constitute a Dispute that shall be resolved pursuant to the Dispute Resolution Procedures.



5.4 Software Licensing Except as provided in the IT Services Agreement or the Marketing Cooperation Agreement or as they may otherwise agree in writing, any Restricted Person may: (i) license to any third party End User any software that is owned by the Restricted Person in response to a request or offer from that third party End User, except, however, that the Restricted Persons shall not in an organized manner market or promote such software or solicit such offers or requests; and (ii) receive from a third party a royalty paid with respect to licenses by such third party of software developed by it for the Restricted Person, except, however, that the Restricted Person shall not in an organized manner market or promote such software. Any Restricted Person shall, in response to unsolicited requests from third parties, be permitted to demonstrate, or answer questions regarding, software described in this Section 5.4.



5.5 AMR Services Subsidiaries Excluded AMR Services Holding Corporation and its Subsidiaries shall be entitled to Compete with the TSG Business, and nothing in this Agreement shall limit the ability of AMR Services Holding Corporation or its Subsidiaries to Compete with the TSG Business; except that AMR and American shall not, for the purpose of avoiding the restrictions imposed on the Restricted Persons under this Agreement, direct or permit AMR Services Holding Corporation or any of its Subsidiaries to engage in any activity that Competes with the TSG Business if that activity either (i) is engaged in principally to benefit one or more of the Restricted Persons (other than any benefit derived solely as an investor), or (ii) principally relates to the business or activities of one or more of the Restricted Persons.



6 THIRD PARTY SUPPLIERS Except as the Parties may otherwise agree in writing, this Agreement does not limit the right or ability of the Restricted Persons to obtain any products or services from third parties that may Compete with the TSG Business. Except as prohibited herein, or as the Parties may otherwise agree in writing, each of the Restricted Persons may market and distribute their products and services through any Person.











Non-competition Agreement 4 6.1 Endorsement of Third Party Products or Services Except as the Parties may otherwise agree in writing, each Restricted Person may authorize any third party to use any of that Restricted Person's logos, trademarks and trade names in connection with advertising such Restricted Person's participation in, purchase or use of any product or service offered by such third party, and may endorse such product or service; except, however, that such Restricted Person may not endorse any such product or service: (i) if TSGH or TSG or any of their respective Subsidiaries is the exclusive provider of a Competing product or service to such Restricted Person; or (ii) as being preferred over or having qualities superior to any equivalent product or service that TSGH or TSG or their respective Subsidiaries are then actually providing to that Restricted Person.



7 AIRLINE ALLIANCES Notwithstanding the restrictions in Section 4.4, Section 4.5, Section 5 and Section 8, but subject to the restrictions of Section 4.3, the Restricted Persons shall be entitled to acquire and hold, through direct ownership or indirect ownership through one or more Persons, any amount of the equity ownership of any Air Carrier, and any Subsidiary of such an Air Carrier; except, however, that if AMR or American Controls, through direct ownership or indirect ownership through one or more Persons, such Air Carrier, and if such Air Carrier or a Subsidiary of such Air Carrier Competes with the TSG Business, then, except as otherwise permitted by Section 9, the Restricted Persons shall within 24 months after such acquisition reduce to 5% or less their collective ownership interest in the Subsidiary that Competes with the TSG Business or sell the assets which are used to Compete with the TSG Business. If possible, the Restricted Persons shall provide TSG the opportunity to bid for such ownership interest or assets.



8 OTHER ACQUISITIONS Notwithstanding the restrictions in Section 4.4, Section 4.5, and Section 5, but subject to the restrictions of Section 4.3, the Restricted Persons shall be entitled to acquire and hold, through direct ownership or indirect ownership through one or more Persons, any amount of the equity ownership or assets of any Person that Competes with the TSG Business if the equity or assets were acquired as a part of a transaction involving the acquisition of a Person or the assets of a business the primary business activity of which does not Compete with the TSG Business; except, however, that if AMR or American Controls, through direct ownership or indirect ownership through one or more Persons, such a Person that Competes with the TSG Business, then, except as otherwise permitted by Section 9, the Restricted Persons shall within 24 months after such acquisition reduce to 5% or less their collective ownership interest in the Person that Competes with the TSG Business or sell the assets of such Person which are used to Compete with the TSG Business. If possible, the Restricted Persons shall provide TSG the opportunity to bid for such ownership interest or assets.



9 EXTENDED DISPOSITION PERIOD Notwithstanding the requirements of Section 7 or Section 8 above, if AMR, American and their respective Subsidiaries diligently attempt during the 24 month period specified in Section 7 or Section 8 above to reduce to 5% or less their collective ownership interest in the Subsidiary that Competes with the TSG Business or sell the assets which are used to Compete with the TSG Business, and if AMR, American and their respective Subsidiaries are unable to do so during such 24 month period as a result of any applicable legal requirement or











Non-competition Agreement 5 fiduciary obligation, then such 24 month period shall be extended to the minimum extent necessary to permit satisfaction or waiver of any such applicable legal requirement or fiduciary obligation.



10 DISPOSITION OF SUBSIDIARY EQUITY Notwithstanding the restrictions in Section 4.4 and Section 4.5 and Section 5, but subject to the restrictions in Section 4.3, the Restricted Persons shall be entitled to retain and continue to own, through direct ownership or indirect ownership through one or more Persons, more than 5% in the aggregate of the equity ownership of a Person that was previously Controlled by AMR or American.



11 PARTICIPATION IN INDUSTRY ORGANIZATIONS Notwithstanding the restrictions in Section 4, each of the Restricted Persons shall be permitted to participate in the management of, and to own, through direct ownership or indirect ownership through one or more Persons, an interest in any air transportation industry cooperative organization or similar Person in which that ownership interest is determine ...