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Exhibit 10.3
LETTER OF INTENT
FOR
JAVAONE 1999-2001
15 July 1998
George Paolini
Sun Microsystems, Inc., Java Software Division
901 San Antonio Road
Palo Alto, CA 94303
Re: JavaOne 1999-2001
Dear George:
This letter serves as the Letter of Intent ("LOI") entered into as of the above
date ("Effective Date") by and between ZD Events Inc., a Delaware corporation
with offices at 303 Vintage Park Drive, Foster City, CA 94404-1138 ("ZD"), and
Sun Microsystems, Inc., with offices at 901 San Antonio Road, Palo Alto,
California 94303, acting by and through its Java Software division ("Java
Software"). In order to confirm our mutual understanding and intent to proceed
and negotiate as outlined herein, please execute both copies of this letter and
return them to us.
I. Purpose Of The LOI
This LOI sets forth specified binding commitments and the non-binding intent
of ZD and Java Software to negotiate in good faith an agreement between them for
Java Software to hold an annual technical conference in the United States for
Java technology developers and users currently known as "JavaOne: Sun's
Worldwide Java Developers' Conference" for three years from 1999 through 2001
(the "Event") and for ZD to produce the Event, on terms and conditions as
generally outlined below.
Except as to the provisions of Article III, there is no legally binding or
enforceable contract between the parties pertaining to the subject matter of
this LOI, and this LOI and any statements of intent or understandings related to
this LOI shall not be deemed to constitute an offer, acceptance, or legally
binding agreement or to create any rights or obligations for or on the part of
any party hereto, absent execution of a definitive agreement ("Definitive
Agreement"). It is anticipated that this LOI will be superseded by the
Definitive Agreement, incorporating the general terms set forth herein and such
other terms upon which the parties may agree. The statements and terms set forth
in this LOI are an incomplete expression of the essential terms to be included
in the Definitive Agreement, and such terms may change following further
investigation and negotiation.
II. Terms Of The Proposed Definitive Agreement
All terms and conditions concerning the agreements described in this LOI
shall be set forth in the Definitive Agreement, incorporating the general terms
set forth herein. The Definitive Agreement will be subject to the approval of
each party acting on advice of counsel and executed by authorized
representatives of each party. Upon execution of this LOI, counsel for ZD will
prepare the Definitive Agreement and counsel for Java Software will prepare
authorization for use of the Sun and Java Software Marks by ZD, and the parties
will negotiate in good faith in an effort to finalize and execute the Definitive
Agreement not later than 01 September 1998. The terms and conditions of the
Definitive Agreement will include representations, warranties, covenants, and
indemnities as are usual and customary in a transaction of this nature.
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III. Binding Commitments
The parties, by this LOI, mutually agree to the following binding
commitments:
A. The Definitive Agreement shall include, in substance, the
following terms:
Recitals
--------
1. ZD, among other things, creates, organizes, promotes, produces,
manages and operates trade shows, exhibitions, conferences, and
seminar events that serve the information technology industry
internationally.
2. Java Software makes, promotes, and distributes products utilizing
its Java technology and holds various "Java" trademarks.
3. Java Software desires to significantly extend the reach, impact,
and influence of its brand among developers and other constituents
by sponsoring and endorsing an annual series of conference events
around Java technology, presently known as JavaOne.
4. Java Software and ZD wish to enter into a definitive agreement
providing ZD with the exclusive right during the term of such an
agreement to organize, produce, and operate the Event under
authorization from Java Software for use of its Java marks in
connection with the Event.
5. Java Software is committed to making the Event the premier
gathering for Java developers and such other constituents as Java
Software may determine, and to sponsor, endorse, and support the
Event.
Term
----
6. The term of the Definitive Agreement shall be for at least three
years from its effective date, and will provide for a minimum of
one Event each year in the U.S. commencing with the 1999 Event.
Java Software will first engage in discussions with ZD prior to
contracting for additional Events in the United States or other
countries.
7. The parties shall meet to review their relationship within 30 days
following the conclusion of the U.S.-based Event in the year 2000
to determine whether both parties wish to extend their agreement
for an additional two years beyond the original expiration date.
Each party shall provide the other with their final intent on such
a possible extension within 30 days after the aforementioned
meeting, and if both parties agree in writing, this LOI or the
Definitive Agreement (as applicable) shall be extended for an
additional two-year period from the original term. Only mutual
written agreement, material breach, or insolvency of one of the
parties may termination of the Definitive Agreement. Nothing in
this LOI or the Definitive Agreement shall preclude ZD from
producing conferences, expositions, or trade shows featuring Java
technology.
Benefits
--------
8. ZD shall, is return for Java Software's three year exclusive
commitment to the Event, provide Java Software with a set pool of
bonus dollars which can be used to purchase advertising, floor
space, marketing information, and educational products services
during the 1999, 2000, and 2001 calendar years. The details of this
program are
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George Paolini
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contained in the Sun Microsystems, JavaOne Contract Rider,
presented by ZD to Sun on July 14, 1998, which shall be
incorporated herein on the Effective Date subject to clarifications
which the parties agree to negotiate in good faith during
completion of the Definitive Agreement.
9. Java Software shall choose its exhibit space to showcase Java
technology. The space shall be allocated to Java Software without
charge, and Java Software shall have the right of first refusal
to participate in all MPOs except those created by other
exhibitors.
Ownership
---------
10. Java Software and ZD acknowledge that Java Software owns the Event
and all goodwill associated therewith, and that ZD owns all Event
revenue, venue leases, and other contractual rights as against
third parties related to the Event.
11. The parties acknowledge that:
a) Java Software owns the Sun and Java Marks, Sun and Java
Software division customer lists, and the technical content
provided by Java Software;
b) ZD owns the ZD Marks, ZD customer lists, and event
production methodologies;
c) Each party owns its pre-existing confidential and
proprietary information;
d) Each party owns materials and information it creates in
connection with the Event; and
e) Except with respect to the Attendee Lists, developments created
jointly by the parties shall be owned jointly by the parties,
and neither party shall have a duty to account to the other
with respect to jointly owned information.
12. Java Software and ZD will own jointly all right, title, and interest
in and to the lists of persons registered to attend the Event (the
"Attendee Lists"). ZD agrees not to use the Attendee Lists in
connection with the production or promotion of a technology
exhibition, conference, or seminar principally featuring a
technology which reasonably may be deemed directly competitive with
Java technology. Java Software agrees not to use the Attendee Lists
except to promote the Java Software division's and Sun's core
businesses, and in no event may Java Software use the Attendee Lists
to compete with ZD's event won business or in connection with the
production or promotion of a technology exhibition, conference or
seminar, unless such event is solely owned and produced by Java
Software. Neither party will have a duty to account to the other
party with respect to any revenues or other benefits arising from
the use of Attendee Lists. Attendee Lists shall not be disclosed to
the parties without the approval of the other party.
Exclusivity
-----------
13. ZD will have the exclusive right to produce the Event for the
mutual benefit of the parties with Java Software's support and
cooperation, and the Java Software division will not directly or
indirectly produce, or be primary sponsor for, or endorse any other
event to circumvent the three year commitment contemplated herein.
Neither party
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George Paolini
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shall, during the term of the LOI or the Definitive Agreement,
use "JavaOne" or any other name by which the parties agree to
identify the Event, or any confusingly similar name, for any
other event in the United States. The parties acknowledge that
the Java Business Expo event produced by ZD is governed by a
separate agreement.
Responsibilities: Finances
--------------------------
l4. The dates, location, and venue of each Event will be arranged by
ZD, subject to Java Software's approval, which will not
unreasonably be withheld. The 1999 Event is scheduled to be held in
mid-June 1999 at Moscone Center. Java Software and ZD acknowledge
that ZD shall have final responsibility for the overall planning,
management, promotion, production, and selection of all vendors for
the Event in the U.S. ZD shall, however review and discuss all
major vendor selections with Java Software particularly as they
relate to the look and feel of the Event and the attendee
experience. Java Software will initiate discussions with ZD
regarding possible launch of the Event in Europe and in Japan in
1999.
15. ZD shall be responsible for all Event finances and shall assume any
profit or loss from the Event in the United States. A key goal of
Java Software is that Java Software incur no cost from the
production of the Event, except that Java Software shall be
responsible for all its own overhead costs, costs relating to
content, costs of its own performance of its own obligations, and
the costs of any other responsibilities Java Software accepts under
the Definitive Agreement, and shall pay any third parties it
retains. Neither party shall charge the other a license fee or any
other fees under the Definitive Agreement.
16. ZD will be responsible for vendor selection and direct costs of
producing the U.S. Event keynote for the 1999 and future U.S.
Events. Such responsibilities and costs shall include staging,
lighting, sound, venue arrangements, and logistics such as
projection. screens, signage, stage sets, and decor on stage and in
the area for the presentation.
17. Java Software shall continue to be responsible for arrangements and
costs for Event content, including but not limited to videos,
speech writing and/or speech coaching, creative presentation,
equipment rental, slide preparation and presentation, selection of
speakers, computer and related equipment for the presentation and
technical support for same, speaker travel, housing, and other
expenses, except to the extent ZD is responsible for certain
aspects of the U.S. Event keynote as set forth above. ZD shall
review and discuss with Java Software ZD's vendor selections
regarding the keynote and the parties shall co-operate to establish
a working schedule of activities so as to avoid overtime or late
fee charges from vendors.
Trademarks
----------
18. Each party owns all right, title and Interest in their respective
trademarks, and will make certain trademarks available to the
other party on terms to be set forth in mutual trademark
authorizations, which shall provide generally as follows:
a) ZD shall have non-exclusive permission to use the Sun and Java
Marts for purposes of promoting the Event; provided, however,
that ZD shall have exclusive permission to use JavaOne and any
other names approved by Java Software by which the Event may
be known ("Event Marks").
b) Java Software shall have non-exclusive permission to use
the ZD Marks to
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George Paolini
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promote the Event.
c) Both parties shall comply with respective trademark
guidelines provided or made available to the other.
d) Neither party shall have the right to use the other's marks
after the expiration or termination of this LOI or the
Definitive Agreement, whichever is later.
e) Each party will have final approval of the use of its Marks
and Logos in marketing materials, which approval shall not be
unreasonably withheld, and will designate a contact to whom
materials will be submitted for review. Materials not
objected to within three business days from receipt may be
used by the sending party, but if the party later reasonably
objects for failure to conform to a party's Trademark
Guidelines, the materials will be conformed after existing
stock is used up.
f) Each party will designate a principal and alternative point
of contact for review and approval of the use of their
respective marks. Materials shall be deemed to have been
submitted to the other for review where (i) that delivery was
documented by confirmed facsimile transmission; and (ii) the
sending party shall have telephoned or left a voice mail
message for the individual recipient advising of the date and
means by which materials were sent.
19. Java Software shall have the right to have appropriate Sun names
and or logos and the JavaOne or other Event name generally
featured in Event signage, promotional materials, and advertising
in location and size more prominent than any other organization.
Other Licenses
--------------
20. Java Software will great to ZD a non-exclusive license and
appropriate access to use Java Software division and Sun customer
lists to solicit attendees and exhibitors to attend the Event and
to otherwise increase the visibility of the Event. Such license
will be exercised through the use of a bonded third-party mail
house reasonably acceptable to Java Software. ZD will provide the
materials to be forwarded to the mail house, and Java Software
will provide the Java Software division and Sun customer lists in
a format reasonably specified by ZD to the mail house for
fulfillment. ZD will not have direct access to the Java Software
division or Sun customer list.
Marketing
---------
21. Java Software shall support ZD's efforts to market the
Event.
22. Java Software and ZD shall create a list of potential Co-Sponsors
for the Event. Java Software or ZD shall initiate first contact
with those and other potential Co-Sponsors. Java Software shall
have final approval of all Co-Sponsors for the Event. ZD shall be
responsible for finalizing each Co-Sponsorship with reasonable
assistance from Java Software.
Miscellaneous
-------------
23. It is the intent of both parties to establish mutually
acceptable qualitative and
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George Paolini
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quantitative goals for each Event. ZD shall conduct research and
measurement against such objectives to determine the Event's
success in achieving the goals.
24. Each Event shall be produced by ZD at the same level of quality
that characterizes ZD's other major events of comparable size
and character in the country where the Event is held. It is the
intention of both parties to provide a distinctive experience
for Event participants, and for ZD to produce the Event at a
level of quality equal to or better than, the quality of the
previous Event in that country.
25. Java Software and ZD acknowledge that obtaining a suitable
number of exhibitors of suitable quality will significantly
affect the Event's success. The parties will use reasonable
efforts to locate and obtain such exhibitors and Java Software
will endorse a letter to send to all relevant Sun and Java
Software division business partners, and to all Java source code
licensees, independent software vendors (ISVs), and corporate
developers.
26. Java Software acknowledges that ZD is in the business of
producing events and that, from time to time, ZD may produce
an event that addresses one or more products of Java Software's
competitors. ZD shall not be precluded from any such activities,
except to the extent expressly provided in paragraph 12 above.
B. In the period between the execution of the LOI and Definitive
Agreement, Java Software will work diligently to formally define the
Java Software go-to market and other objectives for the Event in
1999, and ZD will work diligently on a definitive marketing plan
based on such objectives. Representatives of both parties shall meet
during this period to develop marketing plans and timelines not later
than 18 August 1998. In addition, the parties will define budgetary
bases for the Event under which Java Software's projected net out of
pocket costs for the Event shall be approximately zero dollars,
except to the extent this LOI or the Definitive Agreement provides
that Java Software bear certain costs relating to the Event.
C. All confidential or proprietary material respecting either party will
be kept in confidence by the other party (and its agents, employer,
or professional advisors) and will not be used for any purpose
unrelated to the transaction contemplated by this LOI. This LOI is
confidential. The parties will execute a separate agreement regarding
confidentiality.
D. This LOI shall be effective as of the Effective Date and shall
continue until the earlier of the execution of the Defintive
Agreement or 31 December 2001 if no Definitive Agreement is finally
executed. In the event no Definitive Agreement is finally executed,
the parties shall continue under the terms and conditions of the LOI,
supplemented, solely to the extent necessary, by the practices
previously established by the parties during the 1998 Event as
further supplemented by mutually agreed upon refinements thereof.
E. Except as expressly set forth in this LOI. each party shall bear its
own costs and expenses with regard to all negotiations and activities
relating to this LOI, whether or not a Definitive Agreement is
signed. Notwithstanding the foregoing, Java Software acknowledges
that ZD has to date and will continue to conduct work regarding and
make commitments toward the production of the 1999 Event, including
but not limited to the reservation of hotel room blocks, venue
leases, and provison of services in support of the Event.
F. Liability for Breach or Termination. The parties recognize that
failure of either party to meet its obligations under the LOI or the
Definitive Agreement at any time during the term could give rise to
obligations to pay damages associated with cancellation or
termination of vendor
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obligations. As such, the breaching party shall be obligated to
reimburse the non-breaching party for any and all such costs and
expenses of such vendor obligations upon proof of such expenses and
after a good faith effort to mitigate such costs expenses.
G. Except to the extent provided in this LOI or the Definitive
Agreement, in no event shall either party make a claim against, nor
be liable to, the other party or its affiliates for any indirect,
special, incidental, consequential, or punitive damages in
connection with or arising out of this LOI or the termination
thereof, under any theory of law, including damages for lost profits
or business opportunity, or injury to business reputation, resulting
from the continuation or abandonment of negotiations or failure to
execute the Definitive Agreement.
H. Any legal action arising from or relating to this LOI shall be
governed by California law and venued in California, and the choice
of law rules of any jurisdiction shall not apply.
L. Except to the extent expressly set forth to the contrary herein, this
LOI, to the extent binding upon the parties, supersedes all prior
negotiations and constitutes the entire agreement between the parties
with respect to the Event for 1999 and later dates. This LOI may be
modified only by a writing executed by an authorized representative
of both parties.
WHEREFORE, the parties have caused this LOI to be executed by their duly
authorized representatives.
--------------------------------------------------------------------------------
ZD Events Inc. Sun Microsystems, Inc., by and through its
Java Software division
--------------------------------------------------------------------------------
By: /s/ Richard R. Blouin By: /s/ George Paolini
Name: Richard R. Blouin Name: George Paolini
Title: Executive Vice President Title: Director, Marketing
Date: 7-15-98 Date: 7-15-98
--------------------------------------------------------------------------------
cc: Jason Chudnofsky
Dick Blouin
Michelle O'Connor Abrams
Mo Virani
Geoffrey Creighton
7
