1
EXHIBIT 10.10
TIME WARNER, INC.
00 XXXXXXXXXXX XXXXX
Xxx Xxxx, XX 00000
March 3, 2000
printCafe Systems, Inc.
00 Xxxxxx Xxxxxx Xxxxxx
Xxxxx Xxxxx
Xxxxxxxxxx, XX 00000
Attn: Xxxx Xxxx, President
Re: Agreement in Principle
Dear Xx. Xxxx:
This letter outlines the agreement in principle between Time Warner
Inc., a Delaware corporation ("Publisher"), and printCafe Systems, Inc., a
Delaware corporation ("printCafe"), for the establishment of a co-branded web
site hosted through printCafe's web site "xxxxxXxxx.xxx" (the "Site") through
which Publisher may purchase print services over the Internet.
1. Preferred Procurement Provider Status. Publisher shall make printCafe
its preferred internal print procurement provider and shall not publicly
disclose or acknowledge the use or existence of any other print procurement
system for a nine month period from the execution of a definitive Co-Branded
Site Agreement (the "Definitive Agreement"). For purposes of clarification, (a)
Publisher shall not be obligated to use printCafe to procure its printing
services and shall not be prevented from using a third party business to
business Internet provider for its print procurement services so long as such
relationship is not publicly disclosed or acknowledged, (b) a public disclosure
or public announcement shall mean the issuance of a press release or other
similar general release but shall not mean a disclosure made in conversation or
a written communication with a third party (other than a news reporter) and (c)
Publisher may procure its printing services other than through the Internet.
2. Warrants. The parties acknowledge that the parent company of
printCafe (printCafe, Inc. ("Parent")) has, in consideration for Publisher
signing the letter of intent dated February 3, 2000, agreed to issue to
Publisher, as of the date hereof, a warrant to purchase 100,000 shares of common
stock of Parent at a price of $5.80 per share pursuant to a warrant agreement
dated the date hereof. In consideration for entering into this letter agreement,
printCafe shall cause Parent to issue an additional warrant to purchase 900,000
shares of common stock of parent at a price of $5.80 per share pursuant to the
Warranty Agreement attached hereto as Exhibit A (the "Additional Warrant"). The
parties agree that Publisher shall forfeit its right to the Additional Warrant
(and the Warrant Agreement shall be deemed null and
2
printCafe Systems, Inc.
March 3, 2000
Page 2
void) if the parties do not enter into the Definitive Agreement or this letter
of understanding is terminated by printCafe pursuant to Section 10.
3. Services. Upon execution of the Definitive Agreement, printCafe shall
(i) construct a discreet area hosted at the Site which bear Publisher's
trademarks to be supplied by Publisher (the "Publisher Marks") and which may be
used by Publisher to list orders for its printing jobs or requests for
quotations for printing jobs (the "Co-Branded Site") in accordance with site
specifications to be provided by Publisher (the "Site Specifications"); (ii)
host and maintain the Co-Branded Site; (iii) identify the technical and
functional specifications for and assist in the creation of interfaces to be
used in integrating the Co-Branded Site with Publisher's internal print
procurement software applications which shall be described in the Site
Specifications (the "Interfaces"); and (iv) provide other services as may be
mutually agreed upon between the parties and set forth in the Definitive
Agreement (collectively, the "Services"). The Co-Branded Site shall be fully
operational no later than seventy-five (75) days following the delivery of the
Site Specifications by Publisher. printCafe shall, in connection with the
Co-Branded Site, provide Publisher with a fully staffed customer service call
center from 7:00 a.m. to 10:00 p.m. EST, Monday through Friday, and
7-day/24-hour pager response at all other times in order to resolve customer
questions and problems relating to the Co-Branded Site.
4. Fees. In connection with the development of the Co-Branded Site,
printCafe shall provide up to [*] programming hours (the "Free Hours") at no
cost to Publisher in connection with its provision of the Services. Publisher
shall pay printCafe, on a monthly basis, fees equal to $[*] per hour for
programming hours in excess of the Free Hours, plus reasonable travel and living
expenses which have been approved in advance in writing by Publisher. printCafe
does not currently anticipate significantly exceeding the [*] programming hours
in connection with its provision of the Services and printCafe shall advise
Publisher in writing on a monthly basis of the usage of programming hours during
the prior month. Except for the foregoing, there shall be no other charges by
printCafe to Publisher.
5. Use of Publisher Trademarks and Icons. (a) printCafe shall display
the Publisher Marks and a graphical image file and/or trademark ("Publisher's
Icon") on the Co-Branded Site following the written approval of same by
Publisher. In addition, printCafe shall provide links from the Co-Branded Site
to sites designated by Publisher and to no other sites.
(b) printCafe shall not use any Publisher Xxxx, Publisher's Icon
(or any component of either) on any business sign, business cards, stationery or
forms, or as part of the name of printCafe's business or any division thereof,
or on any advertising or promotional materials without the prior written consent
of Publisher. In addition, printCafe shall not make any announcements or
statements to the public concerning the relationship between printCafe and
Publisher or the transactions described herein without the prior written consent
of Publisher, which consent shall not be unreasonably withheld. Publisher hereby
consents to an appropriate reference to Publisher, the Definitive Agreement when
executed and this letter of understanding
------------------
* Material has been omitted pursuant to a request for confidential treatment.
2
3
printCafe Systems, Inc.
March 3, 2000
Page 3
in printCafe's publicly filed registration statements for securities, subject to
the review and approval by Publisher of such references to Publisher in such
registration statements.
6. Confidentiality. All information that either party acquires from the
other with respect to, or in connection with, the discussions and projects
envisioned hereunder shall be deemed confidential and proprietary information of
the disclosing party which shall be disclosed on a `need to know" basis only,
provided that such information shall not be deemed confidential if such
information (i) was generally available to or known by the public at the time it
was disclosed; (ii) becomes generally available to or known by the public other
than as a result of a disclosure by the receiving party, (iii) becomes available
to the receiving party on a nonconfidential basis from a source other than the
disclosing party (provided that such source is not known by the receiving party
to be prohibited from disclosing such information), (iv) is or was developed by
the receiving party independently of any disclosure by the disclosing party to
the receiving party, or (v) was in the possession of or known by the receiving
party prior to disclosure thereof by the disclosing party.
7. License by printCafe. printCafe shall license (i) to Publisher and
its affiliates a royalty-free, non-exclusive license to use the Co-Branded Site
to procure printing and other related services during the term of the Definitive
Agreement, (ii) to Publisher and its applicable affiliates a royalty-free,
non-exclusive license to use internally and modify the Interfaces (and to
compile any such modified versions thereof) during the term of the Definitive
Agreement and (iii) to Publisher a royalty-free, non-exclusive license to, in
connection with the processing of print orders through the Co-Branded Site, use
certain printCafe software and distribute the printCafe software to its
employees and the employees of its affiliates accessing the Co-Branded Site
during the term of the Definitive Agreement.
8. License by Publisher. Publisher shall grant to printCafe a
non-exclusive, non-transferable license necessary for printCafe to use the
Publisher Marks, Publisher's Icon and Publisher's internal print procurement
software application to perform the Services in accordance with the terms of the
Definitive Agreement. Ownership of all derivative works of the print procurement
software application and of any other of Publisher's programs, tools,
applications or interfaces, in each case developed by or for Publisher (other
than by printCafe) in connection with the provision of the Services or the
transactions contemplated hereby, shall vest in Publisher.
9. Definitive Agreement. Upon execution of this agreement in principle,
the parties shall prepare the Definitive Agreement and any ancillary agreements
which the parties may agree are desirable, which will contain representations,
warranties, indemnities, and other provisions normal and customary in a
transaction of this kind.
10. Non-binding; Termination. This letter is intended as an agreement in
principle summarizing and evidencing Publisher's and printCafe's discussions to
the date hereof. This letter is not intended to be a legally binding agreement
nor does it constitute a legally binding agreement to enter into an agreement,
provided, however, that the provisions set forth in Sections
3
4
printCafe Systems, Inc.
March 3, 2000
Page 3
2, 5(b), 6, 10, 11 and 12 hereof shall be binding upon the parties hereto. This
letter may be terminated by printCafe in its sole discretion in the event that
Publisher enters into negotiations or an agreement with a competitor of
printCafe for the provision of print procurement services prior to the execution
of the Definitive Agreement.
11. Governing Law. This letter of intent shall be governed by and
construed in accordance with the internal laws of the State of New York, without
giving effect to the conflicts of laws principles thereof.
12. Counterparts. This letter of intent may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which when
taken together, shall constitute one and the same instrument.
13. Please indicate your agreement and acceptance of the terms and
conditions of this letter by executing and returning it to Xx. Xxx Xxxxxxxxx at
1271 Avenue of the Americas, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx, 00000, whereupon
this letter shall constitute an agreement in principle between the parties in
accordance with the terms and provisions set forth above. If a fully executed
letter is not returned by 5:00 p.m. by March 6, 2000, its terms shall become
null and void.
Very truly yours,
TIME WARNER, INC.
By:___________________________
Name: Xxxxxx X. XxXxxxxxx
Title: Vice President
AGREED TO AND ACCEPTED:
PRINTCAFE SYSTEMS, INC.
By:________________________
4
