Document:

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                                                                   EXHIBIT 10.4

                              AMENDED AND RESTATED
                              EMPLOYMENT AGREEMENT

This Amended and Restated Employment Agreement (this "Agreement") is made as of
the 12th day of May 2000, effective as of January 1, 2000 (the "Effective
Date"), by and between NEWMARK HOME CORPORATION, a Nevada corporation (the
"Employer"), and LONNIE M. FEDRICK, an individual residing in Sugar Land, Texas
(the "Employee").

                                    RECITALS

The Employer, its divisions, subsidiaries, and other affiliated entities, are
primarily engaged in the business of constructing single-family residences. The
Employer and the Employee entered into an Employment Agreement dated January 1,
1998 (the "Employment Agreement"), the intent and purpose being to specify the
terms and conditions of Employee's employment with the Employer. The Employer
and the Employee desire to amend the terms and conditions of the employment with
the Employer and hereby enter into this Agreement as of the Effective Date.

                                    AGREEMENT

The parties, intending to be legally bound, agree as follows:

1.       DEFINITIONS

For the purposes of this Agreement, the following terms have the meanings
specified or referred to in this Section 1.

         "AEBIT" means actual consolidated earnings before income taxes for the
         Newmark Entities as determined by an independent audit of such entities
         for the years ended December 31, 2000, 2001 and 2002.

         "Agreement"--the Employment Agreement, as amended from time to time,
         including this Agreement.

         "Base Salary"--as defined in Section 3.1(a).

         "Basic Compensation" means Base Salary and Benefits.

         "BEBIT" and "Target Amount" are used interchangeably and mean the
         budgeted earnings before income taxes for the Newmark Entities as has
         been established by the Special Benefits Committee of the Board of
         Directors of Newmark Homes Corp. (the "special Benefits Committee") and
         the Employee prior to the date of this Agreement for the calendar year
         2000 and shall be agreed to prior to the end of the first quarter of
         2001 and 2002 for calendar years 2001 and 2002, respectively. If the
         parties are unable to agree on the BEBIT for 2001, the Target Amount
         shall be 110% of the BEBIT for the prior calendar year. If the parties
         are unable to agree on the BEBIT for 2002, the Target Amount shall be
         the BEBIT for 2000 compounded at 110%.

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         "Benefits"--as defined in Section 3.1(b).

         "Board of Directors" means the Board of Directors of Newmark Homes
         Corp.

         "Bonus Plan"--as defined in Section 3.1 (c).

         "Confidential Information" means any and all intellectual property of
         the Employer (or any of its affiliates), including but not limited to:

          (a)  trade secrets concerning the business and affairs of the Employer
               (or any of its affiliates), product specifications, data,
               know-how, formulae, compositions, processes, designs, sketches,
               photographs, graphs, drawings, samples, inventions and ideas,
               past, current, and planned research and development, current and
               planned manufacturing or distribution methods and processes,
               customer lists, current and anticipated customer requirements,
               price lists, market studies, business plans, computer software
               and programs (including object code and source code), computer
               software and database technologies, systems, structures, and
               architectures (and related formulae, compositions, processes,
               improvements, devices, know-how, inventions, discoveries,
               concepts, ideas, designs, methods and information), and any other
               information, however documented, that is a trade secret under
               federal, state or other applicable law; and

          (b)  information concerning the business and affairs of the Employer
               (or any of its affiliates) (which includes historical financial
               statements, financial projections and budgets, historical and
               projected sales, capital spending budgets and plans, the names
               and backgrounds of key personnel, personnel training and
               techniques and materials), however documented; and

          (c)  notes, analysis, compilations, studies, summaries, and other
               material prepared by or for the Employer (or any of its
               affiliates) containing or based, in whole or in part, on any
               information included in the foregoing.

         "Disability"-- as defined in Section 4.2.

         "Effective Date" means the date stated in the first paragraph of this
         Agreement or, if applicable for the period prior to January 1, 2000,
         the Effective Date set forth in the Employment Agreement.

         "Employee Invention" means any idea, invention, technique,
         modification, process, or improvement (whether patentable or not), any
         industrial design (whether registerable or not), any mask work, however
         fixed or encoded, that is suitable to be fixed, embedded or programmed
         in a semiconductor product (whether recordable or not), and any work of
         authorship (whether or not copyright protection may be obtained for it)
         created, conceived, or developed by the Employee, either solely or in
         conjunction with others, during the Employment Period or at any time
         prior to the Employment Period that Employee was an employee of
         Employer, or a period that includes a portion of the Employment Period,
         that relates in any way to, or is useful in any manner in, the business

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         then being conducted or proposed to be conducted by the Employer, and
         any such item created by the Employee, either solely or in conjunction
         with others, following termination of the Employee's employment with
         the Employer, that is based upon or uses Confidential Information.

         "Employment Period" means the term of the Employee's employment under
         this Agreement.

         "Fiscal Year" means the Employer's fiscal year, as it exists on the
         Effective Date or as changed from time to time.

         "For cause"--as defined in Section 4.3.

         "Percentage of Target Amount Achieved" shall be determined by dividing
         the AEBIT by the BEBIT.

         "Person" means any individual, corporation (including any nonprofit
         corporation), general or limited partnership, limited liability
         company, joint venture, estate, trust, business trust, association,
         organization, or governmental body.

         "Post-Employment Period"-- as defined in Section 5.2.

         "Newmark Entities" shall mean the Employer and all of its subsidiaries,
         whether wholly-owned or not wholly-owned and whether direct or
         indirect.

         "Target Amount"--see BEBIT defined above.

2.       EMPLOYMENT TERMS AND DUTIES

2.1      EMPLOYMENT

         The Employer hereby employs the Employee, and the Employee hereby
         accepts employment by the Employer, upon the terms and conditions set
         forth in this Agreement.

2.2      TERM

         The term of the Employee's employment with the Employer pursuant to the
         Employment Agreement commenced on January 1, 1998 and shall continue
         pursuant to this Agreement on the Effective Date and end on December
         31, 2002, unless terminated earlier in accordance with the provisions
         of Section 4 herein. Employer and Employee may extend the term of this
         Agreement by execution of a written amendment hereto, setting forth the
         terms of such extension. If the parties fail to execute such written
         amendment, but the employment relationship has continued by mutual
         consent, then the terms of such employment shall be deemed to be on a
         month-to-month basis.

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2.3      DUTIES

         The Employee has served as President and Chief Executive Officer of the
         Employer since January 1, 1998 pursuant to the Employment Agreement,
         will continue to serve in such position for the remaining term of this
         Agreement and will have such duties as are assigned or delegated to the
         Employee by the Board of Directors of Newmark Homes Corp. The Employee
         will devote his full business time, attention, skill, and energy
         exclusively to the business of the Employer, will use his best efforts
         to promote the success of the Employer's business, and will cooperate
         fully with the Board of Directors of Employer in the advancement of the
         best interests of the Employer. Nothing in this Section 2.3, however,
         will prevent the Employee from engaging in additional activities in
         connection with personal investments and community affairs that are not
         inconsistent with the Employee's duties under this Agreement. If the
         Employee is elected an officer of any of Employer's affiliates, the
         Employee will fulfill his duties as such officer without additional
         compensation.

3.       COMPENSATION

         The compensation and other benefits payable to the Employee under this
         Agreement shall constitute the full consideration to be paid to the
         Employee for all services to be rendered by the Employee for the
         Employer, its divisions, subsidiaries and other affiliated entities.

3.1      BASIC COMPENSATION

         (a)      The Employee will be paid an annual salary as set forth below
                  ("Base Salary"), which will be payable in equal periodic
                  installments according to the Employer's customary payroll
                  practices, but no less frequently than monthly.

<TABLE>
<CAPTION>
                Calendar Year                   Base Salary
                -------------                   -----------
<S>                                             <C>
                1998                            $400,000.00
                1999                            $450,000.00
                2000                            $525,000.00
                2001                            $550,000.00
                2002                            $575,000.00
</TABLE>

         (b)      The Employee will, during the Employment Period, be permitted
                  to participate in such pension, profit sharing, life
                  insurance, hospitalization, major medical and other employee
                  benefit plans of the Employer that may be in effect from time
                  to time, to the extent Employee is eligible under the terms of
                  those plans (collectively, the "Benefits").

                  (c) Employee has participated in an annual bonus plan pursuant
                  to the Employment Agreement for the calendar years 1998 and
                  1999 and, subject to shareholder approval at the annual
                  shareholder meeting in year 2000 or at any shareholder meeting
                  held thereafter, shall be entitled to participate in an annual
                  bonus plan in accordance with this Agreement for each calendar
                  year thereafter

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                  (collectively, the "Bonus Plan" or "Bonus Plans"). Employee
                  shall be entitled to a cash bonus for each calendar year
                  commencing on or after January 1, 2000 in an amount equal to
                  the product of the Employee's Base Salary for such calendar
                  year (determined at the time the Target Amount is established
                  by the Special Benefits Committee and disregarding any
                  subsequent increase thereof) multiplied by the Percentage of
                  Target Amount Achieved and subject to certification by the
                  Special Benefits Committee. Notwithstanding the foregoing, the
                  Employee's Bonus with respect to any calendar year shall not
                  exceed $1,150,000.

4.       TERMINATION

4.1      EVENTS OF TERMINATION

         The Employment Period, the Employee's Basic Compensation, and any and
         all other rights of the Employee under this Agreement or otherwise as
         an employee of the Employer will terminate (except as otherwise
         provided in this Section 4):

         (a)      upon the death of the Employee;

         (b)      upon the disability of the Employee (as defined in Section
                  4.2) immediately upon notice from either party to the other;

         (c)      for cause (as defined in Section 4.3), immediately upon notice
                  from the Employer to the Employee, or at such later time as
                  such notice may specify; or

         (d)      on December 31, 2002.

4.2      DEFINITION OF DISABILITY

         For purposes of Section 4.1, the Employee will be deemed to have a
         "disability" if, for physical or mental reasons, the Employee is unable
         to perform the essential functions of the Employee's duties under this
         Agreement for 120 consecutive days, or 180 days during any twelve (12)
         month period, as determined in accordance with this Section 4.2. The
         disability of the Employee will be determined by a medical doctor
         selected by written agreement of the Employer and the Employee upon the
         request of either party by notice to the other. If the Employer and the
         Employee cannot agree on the selection of a medical doctor, each of
         them will select a medical doctor and the two (2) medical doctors will
         select a third medical doctor who will determine whether the Employee
         has a disability. The determination of the medical doctor selected
         under this Section 4.2 will be binding on both parties. The Employee
         must submit to a reasonable number of examinations by the medical
         doctor making the determination of disability under this Section 4.2,
         and the Employee hereby authorizes the disclosure and release to the
         Employer of such determination and all supporting medical records. If
         the Employee is not legally competent, the Employee's legal guardian or
         duly authorized attorney-in-fact will act in the Employee's stead,
         under this Section 4.2, for the purposes of submitting the Employee to
         the examinations, and providing the authorization of disclosure,
         required under this Section 4.2.

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4.3      DEFINITION OF "FOR CAUSE"

         For purposes of Section 4.1, the phrase "for cause" means: (a) the
         commission of fraud, theft, embezzlement, or similar malfeasance
         involving moral turpitude or the conviction of, or plea of nolo
         contendere to, any felony; (b) gross negligence, nonfeasance,
         dishonesty, willful misconduct or substantial failure to perform
         employment duties in a manner consistent with normal standards of job
         performance after prior evaluation and warning related to such
         standards of job performance; or (c) the appropriation (or attempted
         appropriation) of a material business opportunity of the Employer.

4.4      TERMINATION PAY

         Effective upon the termination of this Agreement, the Employer will be
         obligated to pay the Employee (or, in the event of his death, his
         designated beneficiary as defined below) only such compensation as is
         provided in this Section 4.4, and in lieu of all other amounts and in
         settlement and complete release of all claims the Employee may have
         against the Employer. For purposes of this Section 4.4, the Employee's
         designated beneficiary will be such individual beneficiary or trust,
         located at such address, as the Employee may designate by notice to the
         Employer from time to time or, if the Employee fails to give notice to
         the Employer of such a beneficiary, the Employee's estate.

         (a)      Termination by the Employer for Cause. If the Employer
                  terminates this Agreement for cause, the Employee will be
                  entitled to receive his accrued, but unpaid, Base Salary only
                  through the date such termination is effective. If the
                  Employer terminates this Agreement for cause, as defined in
                  Section 4.3(a) or 4.3(c), Employee shall forfeit his rights to
                  any payment under any Bonus Plan in which Employee
                  participated at the time of termination, whether or not
                  payments under such Bonus Plan have been accrued by Employer.
                  If the Employer terminates this Agreement for cause, as
                  defined in Section 4.3(b), Employee shall be entitled to
                  receive a pro-rated portion of any payment under any Bonus
                  Plan in which Employee participated at the time of
                  termination, based on the actual days worked by the Employee
                  during the fiscal year on which the Bonus Plan is based.
                  Employee shall not be released from the covenants contained in
                  Section 5 hereof.

         (b)      Termination upon Disability. If this Agreement is terminated
                  by either party as a result of the Employee's disability, as
                  determined under Section 4.2, the Employer will pay the
                  Employee (i) his Base Salary through the remainder of the
                  calendar month during which such termination is effective and
                  (ii) a pro-rated portion of any payment under any Bonus Plan
                  in which Employee participated at the time of termination,
                  based on the actual days worked by the Employee during the
                  fiscal year on which the Bonus Plan is based.

         (c)      Termination upon Death. If this Agreement is terminated
                  because of the Employee's death, the Employee's estate will be
                  entitled to receive (i) his Base Salary through the end of the
                  calendar month in which his death occurs and (ii) a pro-rated
                  portion of any payment under any Bonus Plan in which Employee

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                  participated at the time of termination, based on the actual
                  days worked by the Employee during the fiscal year on which
                  the Bonus Plan is based.

         (d)      Termination on December 31, 2002. If on December 31, 2002,
                  this Agreement terminates because the parties have not
                  extended the Term (as provided in Section 2.2 hereof), the
                  Employee shall be entitled to receive (i) any unpaid Base
                  Salary accrued through December 31, 2002, and (ii) a pro-rated
                  portion of any payment under any Bonus Plan in which Employee
                  participated at the time of termination, based on the actual
                  months worked by the Employee during the fiscal year on which
                  the Bonus Plan is based. Employee shall not be released from
                  the covenants contained in Section 5 hereof; provided however,
                  that Employer shall pay Employee an amount equal to one year's
                  Base Salary. Such amount shall be payable in twelve (12) equal
                  monthly installments, determined by dividing Employee's Base
                  Salary, on the last day of Employee's employment with
                  Employer, by 12, with the first such installment being due and
                  payable on the last day of Employee's employment with
                  Employer, and the remaining installments being due and payable
                  on the same date in each succeeding month. Employer shall have
                  the right, at any time, to release Employee from the covenants
                  contained in Section 5 hereof, at which time Employee's right
                  to receive and Employer's obligation to make any installment
                  payment shall terminate.

         (e)      Termination after December 31, 2002. In the event Employer and
                  Employee agree to continue Employee's employment with Employer
                  after December 31, 2002, pursuant to the terms of Section 2.2
                  hereof, such employment shall be continued, unless otherwise
                  agreed in writing, on a month-to-month basis and on the same
                  terms and conditions as set forth herein, and may be
                  terminated by Employer (i) at any time upon thirty (30) days
                  notice, or (ii) immediately, provided that Employer shall pay
                  Employee in a lump sum, an amount equal to one (1) month's
                  Base Salary. Employee shall be entitled to receive a pro-rated
                  portion of any payment under any Bonus Plan in which Employee
                  participated at the time of termination, based on the actual
                  months worked by the Employee during the fiscal year on which
                  the Bonus Plan is based. Employee shall not be released from
                  the covenants contained in Section 5 hereof; provided however,
                  that Employer shall pay Employee an amount equal to one year's
                  Base Salary. Such amount shall be payable in twelve (12) equal
                  monthly installments, determined by dividing Employee's Base
                  Salary, on the last day of Employee's employment with
                  Employer, by 12, with the first such installment being due and
                  payable on the last day of Employee's employment with
                  Employer, and the remaining installments being due and payable
                  on the same date in each succeeding month. Employer shall have
                  the right, at any time, to release Employee from the covenants
                  contained in Section 5 hereof, at which time Employee's right
                  to receive and Employer's obligation to make any installment
                  payment shall terminate.

                  In the event that Employer terminates Employee for cause, as
                  defined in Section 4.3, then the provisions of this Section
                  4.4(e)(i) and (ii) shall not apply, and Employee will be
                  entitled to receive only his accrued, but unpaid, Base Salary

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                  through the date such termination is effective and Employee
                  shall not be released from the covenants contained in Section
                  5 hereof. If the Employer terminates this Agreement for cause,
                  as defined in Section 4.3(a) or 4.3(c), Employee shall forfeit
                  his rights to any payment under any Bonus Plan in which
                  Employee participated at the time of termination, whether or
                  not payments under such Bonus Plan have been accrued by
                  Employer. If the Employer terminates this Agreement for cause,
                  as defined in Section 4.3(b), Employee shall be entitled to
                  receive a pro-rated portion of any payment under any Bonus
                  Plan in which Employee participated at the time of
                  termination, based on the actual days worked by the Employee
                  during the fiscal year on which the Bonus Plan is based.

         (f)      Benefits. The Employee's accrual of, or participation in plans
                  providing for, Benefits, will cease at the effective date of
                  the termination of this Agreement, except as otherwise
                  specifically provided in writing in the documentation for any
                  such Benefit. The Employee will not receive, as part of his
                  termination pay pursuant to this Section 4, any payment or
                  other compensation for any vacation, holiday, sick leave, or
                  other leave unused on the date the notice of termination is
                  given under this Agreement, unless Employer's written
                  personnel policies provide otherwise.

5.       NON-COMPETITION AND NON-INTERFERENCE

5.1      ACKNOWLEDGMENTS BY THE EMPLOYEE

         The Employee acknowledges that: (a) the services to be performed by him
         under this Agreement are of a special, unique, unusual, extraordinary,
         and intellectual character, and (b) the provisions of this Section 5
         are reasonable and necessary to protect the goodwill and other business
         interests of Employer.

5.2      COVENANTS OF THE EMPLOYEE

         In consideration of the acknowledgments by the Employee, and in
         consideration of the compensation and benefits to be paid or provided
         to the Employee by the Employer, the Employee covenants that he will
         not, directly or indirectly:

         (a)      during the Employment Period, except in the course of his
                  employment hereunder, and during the Post-Employment Period
                  (as defined below), without the express prior written consent
                  of Employer (as authorized by its board of directors), as
                  owner, officer, director, employee, stockholder, principal,
                  consultant, agent, lender, guarantor, cosigner, investor or
                  trustee of any corporation, partnership, proprietorship, joint
                  venture, association or any other entity of any nature,
                  engage, directly or indirectly, in any business of siting,
                  permitting, developing, constructing, or selling single-family
                  homes in (i) the following counties in the State of Texas: (1)
                  Harris County and all contiguous counties, (2) Travis County
                  and all contiguous counties, (3) Bexar County and all
                  contiguous counties, (4) Dallas County and all contiguous
                  counties, and (5) any county in which Employer has
                  homebuilding activity during the Employment

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                  Period, and (ii) the following counties in the State of
                  Tennessee: (1) Williamson County and all contiguous counties,
                  and (2) any county in which Employer engages in business
                  during the Employment Period: provided, however, that the
                  Employee may purchase or otherwise acquire up to (but not more
                  than) one percent (1%) of any class of securities of any
                  enterprise (but without otherwise participating in the
                  activities of such enterprise) if such securities are listed
                  on any national or regional securities exchange or have been
                  registered under Section 12(g) of the Securities Exchange Act
                  of 1934;

         (b)      whether for the Employee's own account or for the account of
                  any other person, at any time during the Employment Period
                  (except for the account of Employer and its affiliates) and
                  the Post-Employment Period, solicit business of the same or
                  similar type being carried on by the Employer, from any person
                  known by the Employee to be a customer of the Employer,
                  whether or not the Employee had personal contact with such
                  person during and by reason of the Employee's employment with
                  the Employer;

         (c)      whether for the Employee's own account or the account of any
                  other person (i) at any time during the Employment Period and
                  the Post-Employment Period, solicit, employ, or otherwise
                  engage as an employee, independent contractor, or otherwise,
                  any person who is an employee of the Employer, or in any
                  manner induce, or attempt to induce, any employee of the
                  Employer to terminate his employment with the Employer; or
                  (ii) at any time during the Employment Period and Post
                  Employment Period, interfere with the Employer's relationship
                  with any person, including any person, who at any time during
                  the Employment Period, was an employee, contractor, supplier,
                  or customer of the Employer; provided, however, that nothing
                  in this Section 5.2(c)(ii) shall preclude Employee from
                  soliciting or employing any person, who was employed by
                  Employer, after six (6) months have lapsed from the last date
                  of the former employee's employment with Employer; or

         (d)      at any time during or after the Employment Period, disparage
                  the Employer or any of its shareholders, parents, affiliates,
                  directors, officers, employees, or agents.

         The term "Post-Employment Period" means the one (1) year period
         beginning on the date of termination of the Employee's employment with
         the Employer.

         If any covenant in this Section 5.2 is held to be unreasonable,
         arbitrary, or against public policy, such covenant will be considered
         to be divisible with respect to scope, time, and geographic area, and
         such lesser scope, time, or geographic area, or all of them, as a court
         of competent jurisdiction may determine to be reasonable, not
         arbitrary, and not against public policy, will be effective, binding,
         and enforceable against the Employee. Employee hereby agrees that this
         covenant is a material and substantial part of this Agreement and that
         (i) the geographic limitations are reasonable; (ii) the one (1) year
         term of the covenant is reasonable; and (iii) the covenant is not made
         for the purpose of limiting competition per se and is reasonably
         related to a protectable business interest of the Employer.

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         The period of time applicable to any covenant in this Section 5.2 will
         be extended by the duration of any violation by the Employee of such
         covenant.

         The Employee will, while the covenant under this Section 5.2 is in
         effect, give notice to the Employer, within ten (10) days after
         accepting any other employment, of the identity of the Employee's
         employer. The Employer may notify such employer that the Employee is
         bound by this Agreement and, at the Employer's election, furnish such
         employer with a copy of this Agreement or relevant portions thereof.

6.       NON-DISCLOSURE COVENANT; EMPLOYEE INVENTIONS

6.1      ACKNOWLEDGMENTS BY THE EMPLOYEE

         The Employee acknowledges that (a) during the Employment Period and as
         a part of his employment, the Employee will be afforded access to
         Confidential Information; (b) public disclosure of such Confidential
         Information could have an adverse effect on the Employer and its
         business; (c) because the Employee possesses substantial technical
         expertise and skill with respect to the Employer's business, the
         Employer desires to obtain exclusive ownership of each Employee
         Invention, and the Employer will be at a substantial competitive
         disadvantage if it fails to acquire exclusive ownership of each
         Employee Invention; and (d) the provisions of this Section 6 are
         reasonable and necessary to prevent the improper use or disclosure of
         Confidential Information and to provide the Employer with exclusive
         ownership of all Employee Inventions.

6.2      AGREEMENTS OF THE EMPLOYEE

         In consideration of the compensation and benefits to be paid or
         provided to the Employee by the Employer under this Agreement, the
         Employee covenants as follows:

         (a)      Confidentiality.

                  (i)      During and following the Employment Period, the
                           Employee will hold in confidence the Confidential
                           Information and will not disclose it to any person
                           other than in connection with the performance of his
                           duties and obligations hereunder, except with the
                           specific prior written consent of the Employer or
                           except as otherwise expressly permitted by the terms
                           of this Agreement.

                  (ii)     Any trade secrets of the Employer will be entitled to
                           all of the protections and benefits under the federal
                           and state trade secret and intellectual property laws
                           and any other applicable law. If any information that
                           the Employer deems to be a trade secret is found by a
                           court of competent jurisdiction not to be a trade
                           secret for purposes of this Agreement, such
                           information will, nevertheless, be considered
                           Confidential Information for purposes of this
                           Agreement. The Employee hereby waives any

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<PAGE>   11

                           requirement that the Employer submit proof of the
                           economic value of any trade secret or post a bond or
                           other security.

                  (iii)    None of the foregoing obligations and restrictions
                           applies to any part of the Confidential Information
                           that the Employee demonstrates was or became
                           generally available to the public other than as a
                           result of a disclosure by the Employee.

                  (iv)     The Employee will not remove from the Employer's
                           premises (except to the extent such removal is for
                           purposes of the performance of the Employee's duties
                           at home or while traveling, or except as otherwise
                           specifically authorized by the Employer) any
                           document, record, notebook, plan, model, component,
                           device, or computer software or code, whether
                           embodied in a disk or in any other form belonging to
                           the Employer or used in Employer's business
                           (collectively, the "Proprietary Items"). The Employee
                           recognizes that, as between the Employer and the
                           Employee, all of the Proprietary Items, whether or
                           not developed by the Employee, are the exclusive
                           property of the Employer. Upon termination of this
                           Agreement, or upon the request of the Employer during
                           the Employment Period, the Employee will return to
                           the Employer all of the Proprietary Items in the
                           Employee's possession or subject to the Employee's
                           control, and the Employee shall not retain any
                           copies, abstracts, sketches, or other physical
                           embodiment of any of the Proprietary Items.

         (b)      Employee Inventions. Each Employee Invention will belong
                  exclusively to the Employer. The Employee acknowledges that
                  all of the Employee's writing, works of authorship and other
                  Employee Inventions are works made for hire and the property
                  of the Employer, including any copyrights, patents, or other
                  intellectual property rights pertaining thereto. If it is
                  determined that any such works are not works made for hire,
                  the Employee hereby assigns to the Employer all of the
                  Employee's right, title, and interest, including all rights of
                  copyright, patent, and other intellectual property rights, to
                  or in such Employee Inventions. The Employee covenants that he
                  will promptly:

                  (i)      disclose to the Employer in writing any Employee
                           Invention;

                  (ii)     assign to the Employer or to a party designated by
                           the Employer, at the Employer's request and without
                           additional compensation, all of the Employee's right
                           to the Employee Invention for the United States and
                           all foreign jurisdictions;

                  (iii)    execute and deliver to the Employer such
                           applications, assignments, and other documents as the
                           Employer may request in order to apply for and obtain
                           patents or other registrations with respect to any
                           Employee Invention in the United States and any
                           foreign jurisdictions;

                  (iv)     sign all other papers necessary to carry out the
                           above obligations; and

                                      -11-
<PAGE>   12

                  (v)      give testimony and render any other assistance but
                           without expense to the Employee in support of the
                           Employer's rights to any Employee Invention.

6.3      DISPUTES OR CONTROVERSIES

         The Employee recognizes that should a dispute or controversy arising
         from or relating to this Agreement be submitted for adjudication to any
         court, arbitration panel, or other third party, the preservation of the
         secrecy of Confidential Information may be jeopardized. All pleadings,
         documents, testimony, and records relating to any such adjudication
         will be maintained in secrecy and will be available for inspection by
         the Employer, the Employee, and their respective attorneys and experts,
         who will agree, in advance and in writing, to receive and maintain all
         such information in secrecy, except as may be limited by them in
         writing.

7.       GENERAL PROVISIONS

7.1      INJUNCTIVE RELIEF AND ADDITIONAL REMEDY

         The Employee acknowledges that the injury that would be suffered by the
         Employer as a result of a breach of the provisions of this Agreement
         (including any provision of Sections 5 and 6) would be irreparable and
         that an award of monetary damages to the Employer for such a breach
         would be an inadequate remedy. Consequently, the Employer will have the
         right, in addition to any other rights it may have, to obtain
         injunctive relief to restrain any breach or threatened breach or
         otherwise to specifically enforce any provision of this Agreement.
         Without limiting the Employer's rights under this Section 7 or any
         other remedies of the Employer, if the Employee breaches any of the
         provisions of Sections 5 and 6 and such breach is proven in a court of
         competent jurisdiction, the Employer will have the right to cease
         making any payments otherwise due to the Employee under this Agreement.

                                      -12-
<PAGE>   13

7.2      COVENANTS OF SECTIONS 5 AND 6 ARE ESSENTIAL AND INDEPENDENT COVENANTS

         The covenants by the Employee in Sections 5 and 6 are essential
         elements of this Agreement, and without the Employee's agreement to
         comply with such covenants, the Employer would not have entered into
         this Agreement or continued the employment of the Employee. The
         Employer and the Employee have independently consulted their respective
         counsel and have been advised in all respects concerning the
         reasonableness and propriety of such covenants, with specific regard to
         the nature of the business conducted by the Employer.

         The Employee's covenants in Section 5 and 6 are independent covenants
         and the existence of any claim by the Employee against the Employer
         under this Agreement or otherwise will not excuse the Employee's breach
         of any covenant in Sections 5 or 6.

         If the Employee's employment hereunder expires or is terminated, this
         Agreement will continue in full force and effect as is necessary or
         appropriate to enforce the covenants and agreements of the Employee in
         Sections 5 and 6.

7.3      LEGAL RECOURSE

         Employee further agrees that these covenants are made to protect the
         legitimate business interests of the Employer. Employee understands as
         a part of these covenants that the Employer intends to exercise
         whatever legal recourse against him for any breach of this Agreement
         and in particular, for any breach of these covenants.

8.       GENERAL PROVISIONS

8.1      WAIVER

         The rights and remedies of the parties to this Agreement are cumulative
         and not alternative. Neither the failure nor any delay by either party
         in exercising any right, power, or privilege under this Agreement will
         operate as a waiver of such right, power, or privilege, and no single
         or partial exercise of any such right, power, or privilege will
         preclude any other or further exercise of such right, power, or
         privilege or the exercise of any other right, power, or privilege. To
         the maximum extent permitted by applicable law, (a) no claim or right
         arising out of this Agreement can be discharged by one party, in whole
         or in part, by a waiver or renunciation of the claim or right unless in
         writing signed by the other party; (b) no waiver that may be given by a
         party will be applicable except in the specific instance for which it
         is given; and (c) no notice to or demand on one party will be deemed to
         be a waiver of any obligation of such party or of the right of the
         party giving such notice or demand to take further action without
         notice or demand as provided in this Agreement.

                                      -13-
<PAGE>   14

8.2      BINDING EFFECT; DELEGATION OF DUTIES PROHIBITED

         This Agreement shall inure to the benefit of, and shall be binding
         upon, the parties hereto and their respective successors, assigns,
         heirs, and legal representatives, including any entity with which the
         Employer may merge or consolidate or to which all or substantially all
         of its assets may be transferred. The duties and covenants of the
         Employee under this Agreement, being personal, may not be delegated.

8.3      NOTICES

         All notices, consents, waivers, and other communications under this
         Agreement must be in writing and will be deemed to have been duly given
         when (a) delivered by hand (with written confirmation of receipt), (b)
         sent by facsimile (with written confirmation of receipt), provided that
         a copy is mailed by certified mail, return receipt requested, or (c)
         when received by the addressee, if sent by a nationally recognized
         overnight delivery service, in each case to the appropriate addresses
         and facsimile numbers set forth below (or to such other addresses and
         facsimile numbers as a party may designate by notice to the other
         parties):

         If to Employer:

                  Newmark Home Corporation
                  1200 Soldiers Field Drive
                  Sugar Land, TX 77479
                  Facsimile No.:  281/243-0132

         With a copy to:

                  Holly A. Hubenak
                  Technical Olympic USA, Inc.
                  1200 Soldiers Field Drive
                  Sugar Land, TX 77479
                  Facsimile No.: 281/243-0116

         If to the Employee:

                  Lonnie M. Fedrick
                  19 Legend Park Drive
                  Sugar Land, Texas 77479

8.4      ENTIRE AGREEMENT; AMENDMENTS

         Employee and Employer have entered into a Mutual Agreement to Arbitrate
         Claims (the "Arbitration Agreement") incorporated herein for all
         purposes as if set forth in full. The Arbitration Agreement is hereby
         amended to provide that the Arbitration as defined in the Arbitration
         Agreement, shall be non-binding. This Agreement, together with the

                                      -14-
<PAGE>   15

         Arbitration Agreement, contains the entire agreement between the
         parties with respect to the subject matter hereof and supersedes all
         prior agreements and understandings, oral or written, between the
         parties hereto with respect to the subject matter hereof. This
         Agreement may not be amended orally, but only by an agreement in
         writing signed by the parties hereto.

8.5      GOVERNING LAW

         This Agreement will be governed by the laws of the State of Texas
         without regard to conflicts of laws principles.

8.6      SEVERABILITY

         If any provision of this Agreement is held invalid or unenforceable by
         any court of competent jurisdiction, the other provisions of this
         Agreement will remain in full force and effect. Any provision of this
         Agreement held invalid or unenforceable only in part or degree will
         remain in full force and effect to the extent not held invalid or
         unenforceable.

                                      -15-
<PAGE>   16

         IN WITNESS WHEREOF, the parties have executed and delivered this
Agreement as of the date first above written.

                                           "EMPLOYER"

                                           NEWMARK HOME CORPORATION

                                           /s/ Constantine Stengos
                                           By: Newmark Homes Corp. (its sole
                                           shareholder)
                                           Name: Constantine Stengos
                                           Title: Chairman of the Board of
                                           Directors

                                           "EMPLOYEE"

                                           /s/ Lonnie M. Fedrick
                                           LONNIE M. FEDRICK

                                      -16-<PAGE>

                                                                    EXHIBIT 10.1

                             DISTRIBUTION AGREEMENT

                                      among

                                ZIFF-DAVIS INC.,

                              KEY3MEDIA GROUP, INC.

                                       and

                             KEY3MEDIA EVENTS, INC.

                          dated as of August ___, 2000
<PAGE>

                               TABLE OF CONTENTS

                                                                          Page
                                                                          ----

                                    ARTICLE I
                                   DEFINITIONS

   SECTION 1.1. General......................................................1
   SECTION 1.2. Reference; Interpretation....................................6

                                   ARTICLE II
                                    COVENANTS

   SECTION 2.1. Corporate Reorganization and Other Transactions..............6
   SECTION 2.2. Credit Facility..............................................7
   SECTION 2.3. Senior Debentures............................................7
   SECTION 2.4. Repayment of Borrowings......................................7
   SECTION 2.5. Dividend to Ziff-Davis.......................................7
   SECTION 2.6. Inter-Group Obligations......................................7
   SECTION 2.7. Further Assurances...........................................8
   SECTION 2.8. Witness Services.............................................8
   SECTION 2.9. Transition Services..........................................8
   SECTION 2.10. Corporate Names; Trademarks.................................8

                                   ARTICLE III
                                  DISTRIBUTION

   SECTION 3.1. Distribution.................................................9

                                   ARTICLE IV
                         CONDITIONS TO THE DISTRIBUTION

   SECTION 4.1. Conditions to the Distribution...............................9
   SECTION 4.2. No Constraints..............................................10
   SECTION 4.3. Deferral of the Distribution Date...........................10
   SECTION 4.4. Public Notice of the Deferred Distribution Date.............11

                                    ARTICLE V
                                 INDEMNIFICATION

   SECTION 5.1. Indemnification by Ziff-Davis...............................11
   SECTION 5.2. Indemnification by Key3Media................................11
   SECTION 5.3. Procedures for Indemnification..............................11
   SECTION 5.4. Indemnification Payments....................................13

                                   ARTICLE VI
                                       TAX

   SECTION 6.1. Liability for Taxes and Related Matters.....................13
   SECTION 6.2. Transfer Taxes..............................................17
   SECTION 6.3. Information to be Provided by Key3Media.....................17
<PAGE>

   SECTION 6.4. Payments....................................................17
   SECTION 6.5. Treatment of Intercompany Payments..........................17
   SECTION 6.6. Tax Attributes..............................................17
   SECTION 6.7. Assistance and Cooperation..................................18
   SECTION 6.8. Survival of Obligations.....................................19

                                   ARTICLE VII
                              ACCESS TO INFORMATION

   SECTION 7.1. Provision of Corporate Records..............................19
   SECTION 7.2. Access to Information.......................................19
   SECTION 7.3. Confidentiality.............................................19
   SECTION 7.4. Privileged Matters..........................................20
   SECTION 7.5. Ownership of Information....................................21
   SECTION 7.6. Retention of Records........................................21
   SECTION 7.7. Limitation of Liability; Release............................22

                                  ARTICLE VIII
                                  MISCELLANEOUS

   SECTION 8.1. Complete Agreement; Construction............................22
   SECTION 8.2. Counterparts................................................22
   SECTION 8.3. Survival of Agreements......................................22
   SECTION 8.4. Distribution Expenses.......................................22
   SECTION 8.5. Notices.....................................................23
   SECTION 8.6. Waivers.....................................................23
   SECTION 8.7. Amendments..................................................23
   SECTION 8.8. Assignment..................................................24
   SECTION 8.9. Successors and Assigns......................................24
   SECTION 8.10. Termination................................................24
   SECTION 8.11. Subsidiaries...............................................24
   SECTION 8.12. Third Party Beneficiaries..................................24
   SECTION 8.13. Title and Headings.........................................24
   SECTION 8.14. Exhibits and Schedules.....................................24
   SECTION 8.15. GOVERNING LAW..............................................24
   SECTION 8.16. Consent to Jurisdiction....................................24
   SECTION 8.17. Severability...............................................25
<PAGE>

                             DISTRIBUTION AGREEMENT

          THIS DISTRIBUTION AGREEMENT (this "Agreement") is dated as of August
                                             ---------
__, 2000, among Ziff-Davis Inc., a Delaware corporation ("Ziff-Davis"),
                                                          ----------
Key3Media Group, Inc., a Delaware corporation ("Key3Media"), and Key3Media
                                                ---------
Events, Inc., a Delaware corporation and a wholly owned subsidiary of Ziff-Davis
("Events").
  ------

          WHEREAS, the Board of Directors of Ziff-Davis has determined that it
is appropriate and desirable to dispose of all of its businesses that are not
Internet-related and transform Ziff-Davis into a company focused almost
exclusively on Internet-related businesses;

          WHEREAS, through its wholly owned subsidiaries listed on Exhibit A
                                                                   ---------
hereto (collectively, the "Events Subsidiaries"), Ziff-Davis is currently
                           -------------------
engaged in the businesses of producing, promoting and managing tradeshows,
conferences and other events for the information technology industry (the

"Events Business");
----------------

          WHEREAS, the Board of Directors of Ziff-Davis has determined that it
is appropriate and desirable to dispose of the Events Business by (i) causing
all of the Event Subsidiaries other than Events to become wholly owned by Events
and Key3Media, (ii) contributing all of the issued and outstanding shares of
Events to Key3Media in exchange for shares of the common stock, par value $0.01
per share, of Key3Media (the "Key3Media Common Stock"), and (iii) distributing
                              ----------------------
shares of Key3Media Common Stock by dividend to the record holders of the issued
and outstanding shares of Ziff-Davis Inc. -- ZD Common Stock, par value $0.01
per share, of Ziff-Davis (the "Ziff-Davis Common Stock"), at the close of
                               -----------------------business on a record date
to be determined as provided herein at the rate of one Key3Media Share for each
two shares of Ziff-Davis Common Stock (the "Distribution");
                                            ------------

          NOW, THEREFORE, in consideration of the mutual covenants contained in
this Agreement, the parties hereby agree as follows:

                                   ARTICLE I

                                  DEFINITIONS

     SECTION 1.1.  General. Unless otherwise defined herein or unless the
     -------
context otherwise requires, as used in this Agreement, the following terms shall
have the following meanings:

               "Action" means any lawsuit or other proceeding by or before any
                ------
     court or other governmental, regulatory or administrative body.

               "Affiliate" shall have the meaning set forth in Rule 405
                ---------
     promulgated under the Securities Act as interpreted thereunder.

               "Agent" shall have the meaning set forth in Section 3.1(a) of
                -----
     this Agreement.
<PAGE>

               "Agreement" shall mean this Distribution Agreement.
                ---------

               "Commission" shall mean the U.S.  Securities and Exchange
                ----------
     Commission.

               "Distribution" shall have the meaning set forth in the recitals
                ------------
     to this Agreement.

               "Distribution Date" shall mean such date as may be determined by
                -----------------
     the Board of Directors of Ziff-Davis, or such committee of such Board of
     Directors as shall be designated by the Board of Directors of Ziff-Davis,
     as the date as of which the Distribution shall be effected.

               "Distribution Record Date" shall mean such date as may be
                ------------------------
     determined by the Board of Directors of Ziff-Davis, or such committee of
     such Board of Directors as shall be designated by the Board of Directors of
     Ziff-Davis, as the record date for the Distribution.

               "Effective Time" shall mean 5:00 p.m., New York City time, on the
                --------------
     Distribution Date.

               "Event Subsidiaries" shall have the meaning set forth in the
                ------------------
     Recitals to this Agreement.

               "Event Businesses" shall have the meaning assigned to it in the
                ----------------
     Recitals to this Agreement.

               "Exchange Act" shall mean the Securities Exchange Act of 1934, as
                ------------
     amended, together with the rules and regulations promulgated thereunder.

               "Financings" shall have the meaning set forth in Section 2.4.
                ----------

               "Governmental Authority" shall mean any federal, state, local,
                ----------------------
     foreign or international court, government, department, commission, board,
     bureau, agency, official, the NYSE, the NASD or other regulatory,
     administrative or governmental authority.

               "Income Taxes" means all federal, state, local or foreign income,
                ------------
     franchise or similar taxes imposed on or measured by (i) net income or (ii)
     capital, where the taxing jurisdiction (A) taxes capital in lieu of net
     income, (B) taxes capital in addition to net income or (C) imposes a tax on
     capital as a minimum tax where there is no net income, together with any
     interest, additions or penalties with respect thereto and any interest in
     respect of such additions or penalties.

               "Income Tax Returns" means all reports, forms, filings,
                ------------------
     information returns or other documents required to be filed with respect to
     Income Taxes and all schedules or statements required to be filed
     therewith, including without limitation any

                                      -2-
<PAGE>

     amended returns, and any documents with respect to or accompanying payments
     of estimated Income Taxes.

               "Income Tax Returns Supporting Documentation" means all
                -------------------------------------------
     supporting documentation, forms, filings, questionnaires, disclosure
     schedules, schedules of Income Tax attributes, workpapers, calculations of
     any limitations on availability of any Income Tax benefit or attribute, and
     information returns.

               "Indemnified Party" shall have the meaning set forth in Section
                -----------------
     5.3(a) of this Agreement.

               "Indemnifying Party" shall have the meaning set forth in Section
                ------------------
     5.3(a) of this Agreement.

               "Key3Media" shall have the meaning set forth in the preamble to
                ---------
     this Agreement.

               "Key3Media Common Stock" shall have the meaning set forth in the
                ----------------------
     Recitals to this Agreement.

               "Key3Media Group" shall mean Key3Media and the Events
                ---------------
     Subsidiaries.

               "Key3Media Indemnitees" shall mean:
                ---------------------

               (i) Key3Media and each of the Events Subsidiaries; and

               (ii) each of the respective past, present and future directors,
          officers, members, employees and agents of any of the entities
          described in the immediately preceding clause (i) and each of the
          heirs, executors, successors and assigns of any of such directors,
          officers, members, employees and agents.

               "Key3Media Shares" shall have the meaning set forth in Section
                ----------------
     2.1(a) to this Agreement.

               "Law" shall mean all laws, statutes and ordinances and all
                ---
     regulations, rules and other pronouncements of Governmental Authorities
     having the effect of law of the United States, any foreign country, or any
     domestic or foreign state, province, commonwealth, city, country,
     municipality, territory, protectorate, possession or similar
     instrumentality, or any Governmental Authority thereof.

               "Liabilities" shall mean any and all debts, liabilities,
                -----------
     obligations, losses, damages (whether compensatory, punitive or treble),
     fines, penalties and sanctions, absolute or contingent, matured or
     unmatured, liquidated or unliquidated, foreseen or unforeseen, joint,
     several or individual, asserted or unasserted, accrued or unaccrued, known
     or unknown, whenever arising, including without limitation those arising
     under or in connection with any Law (including any environmental laws),
     Action, threatened

                                      -3-
<PAGE>

     Action, order or consent decree of any Governmental Authority or any award
     of any arbitration tribunal, and those arising under any contract,
     guarantee, commitment or undertaking, whether sought to be imposed by a
     Governmental Authority, private party, or party to this Agreement, whether
     based in contract, tort, implied or express warranty, strict liability,
     criminal or civil statute, or otherwise, and including any costs, expenses,
     interest, attorneys' fees, disbursement and expense of counsel, expert and
     consulting fees and costs related thereto or to the investigation or
     defense thereof.

               "NASD" shall mean the National Association of Securities Dealers.
                ----

               "Notices" shall have the meaning set forth in Section 8.5 of this
                -------
     Agreement.

               "NYSE" shall mean the New York Stock Exchange, Inc.
                ----

               "Person" shall mean any natural person, corporation, business
                ------
     trust, limited liability company, joint venture, association, company,
     partnership or government, or any agency or political subdivision thereof.

               "Pro-Forma Income Tax Return" means a draft Income Tax Return
                ---------------------------
     indicating the liability of Key3Media for an Income Tax period, it being
     understood by the parties to this Agreement that each such draft shall
     substantially reflect such liability of Key3Media as reported on the Income
     Tax Return ultimately filed for such period by the Ziff-Davis Group
     (including for this purpose members of the Key3Media Group).

               "Records" shall have the meaning set forth in Section 7.1 of this
                -------
     Agreement.

               "Registration Rights Agreement" shall mean the Registration
                -----------------------------
     Rights Agreement by and between SOFTBANK Corp.  and Key3Media, which
     agreement shall be entered into prior to or on the Distribution Date in the
     form attached hereto as Exhibit B.
                             ---------

               "Registration Statements" shall mean, collectively, the
                -----------------------
     Registration Statement on Form S-1, File No.  333-36828,  relating to the
     Distribution filed by Key3Media with the Commission under the Securities
     Act and the Registration Statement on Form 10 relating to the Key3Media
     Common Stock filed by Key3Media with the Commission under the Exchange Act,
     in each case in the form declared effective by the Commission.

               "Representative" shall mean, with respect to any Person, the
                --------------
     directors, officers, employees, agents, consultants, advisors, accountants,
     attorneys and representatives of such Person and its Subsidiaries.

               "Securities Act" shall mean the Securities Act of 1933, as
                --------------
     amended, together with the rules and regulations promulgated thereunder.

                                      -4-
<PAGE>

               "Subsidiary" shall mean, with respect to any specified Person,
                ----------
     any corporation or other legal entity of which such Person or any of its
     Subsidiaries controls or owns, directly or indirectly, more than 50% of the
     stock or other equity interest entitled to vote generally in the election
     of members to the board of directors or similar governing body.

               "Taxes" means all federal, state, local or foreign, property
                -----
     (real or personal), production, sales, use, value added, license, excise,
     franchise, transfer, gains, mortgage recording, transportation, employment,
     occupation, pension plan, Social Security, payroll withholding, withholding
     or similar taxes imposed on the properties or other assets of the relevant
     entity, together with any interest, additions or penalties with respect
     thereto and any interest in respect of such additions or penalties.

               "Tax Returns" means all reports and returns required to be filed
                -----------
     with respect to or including the Taxes of the relevant member or members of
     the Key3Media Group.

               "Unclaimed Property" shall have the meaning set forth in Section
                ------------------
     3.1(c).

               "ZD Intellectual Property" shall have the meaning set forth in
                ------------------------
     Section 2.10(a) of this Agreement.

               "Ziff-Davis" shall have the meaning set forth in the preamble to
                ----------
     this Agreement.

               "Ziff-Davis Businesses" shall mean, collectively, each and every
                ---------------------
     business conducted at any time by Ziff-Davis or any of its Subsidiaries
     other than the Events Businesses.

               "Ziff-Davis Common Stock" shall have the meaning set forth in the
                -----------------------
     Recitals to this Agreement.

               "Ziff-Davis Group" shall mean Ziff-Davis and each Person that is
                ----------------
     a Subsidiary of Ziff-Davis other than members of the Key3Media Group.

               "Ziff-Davis Indemnitee" shall mean:
                ---------------------

               (i) Ziff-Davis and each Affiliate thereof; and

               (ii) each of the respective past, present and future directors,
          officers, members, employees and agents of any of the entities
          described in the immediately preceding clause (i) and each of the
          heirs, executors, successors and assigns of any of such directors,
          officers, members, employees and agents, except in the case of clauses
          (i) and (ii), the Key3Media Indemnitees.

                                      -5-
<PAGE>

     SECTION 1.2.    Reference; Interpretation. References in this Agreement
                     -------------------------
to any gender include references to all genders, and references to the singular
include references to the plural and vice versa. The words "include", "includes"
and "including" when used in this Agreement shall be deemed to be followed by
the phrase "without limitation." Unless the context otherwise requires,
references in this Agreement to Articles, Sections, Exhibits and Schedules shall
be deemed references to Articles and Sections of, and Exhibits and Schedules to,
this Agreement. Unless the context otherwise requires, the words "hereof",
"hereby" and "herein" and words of similar meaning when used in this Agreement
refer to this Agreement in its entirety and not to any particular Article,
Section or provision of this Agreement. This Agreement shall not be construed
against either party as the principal draftsperson hereof.

                                   ARTICLE II

                                    COVENANTS

     SECTION 2.1.    Corporate Reorganization and Other Transactions.
                     -----------------------------------------------

     (a) Corporate Reorganization. On or prior to the Distribution Date,
         ------------------------
Ziff-Davis shall transfer or cause to be transferred to Events all of the issued
and outstanding shares of the capital stock of, or other equity interests in,
each of the Events Subsidiaries other than Events (other than those held by
individuals or to be transferred to Key3Media pursuant to the next sentence).
Thereafter, and on or prior to the Distribution Date, Ziff-Davis shall transfer
or cause to be transferred to Key3Media all of the issued and outstanding shares
of capital stock of, or other equity interests in, Events and the remaining
shares it owns in the Event Subsidiaries other than Events and in consideration
of such transfers Key3Media shall issue and deliver to Ziff-Davis a certificate
registered in the name of Ziff- Davis representing the number of shares of
Key3Media Common Stock equal to one-half of the total number of issued and
outstanding shares of Ziff-Davis Common Stock held of record at the close of
business on the Distribution Record Date (the "Key3Media Shares"). Key3Media
                                               ----------------
hereby represents and warrants that each Key3Media Share will be validly issued,
fully paid and non-assessable and free of any preemptive (or similar) rights.

     (b) Charter and Bylaws. On or prior to the Distribution Date, Key3Media and
         ------------------
Ziff-Davis shall have taken all necessary actions to provide for the adoption of
the form of Restated Certificate of Incorporation and Bylaws in substantially
the form filed by Key3Media with the Commission as exhibits to the Registration
Statements.

     (c) Directors. On or prior to the Distribution Date, Ziff-Davis and
         ---------
Key3Media shall have taken all necessary action to cause the Board of Directors
of Key3Media to consist of the individuals identified as directors of Key3Media
in the Registration Statements.

     (d) Election of Officers. On or prior to the Distribution Date, Key3Media
         --------------------
shall take all actions necessary and desirable so that as of the Distribution
Date the officers of Key3Media will be as set forth in the Registration
Statements.

                                      -6-
<PAGE>

     (e) State Securities Laws. Prior to the Distribution Date, Ziff-Davis and
         ---------------------
Key3Media shall take all such action as may be necessary or appropriate under
the securities or blue sky laws of states or other political subdivisions of the
United States in order to effect the Distribution.

     (f) Listing Application. Prior to the Distribution Date, Ziff-Davis and
         -------------------
Key3Media shall prepare and file with the NYSE a listing application and related
documents and shall take all such other actions with respect thereto as shall be
necessary or desirable in order to cause the NYSE to list the Key3Media Common
Stock on or prior to the Distribution Date, subject to official notice of
issuance.

     (g) Notice to NYSE. Ziff-Davis shall give the NYSE not less than ten days
         --------------
advance notice of the Distribution Record Date in compliance with Rule 10b- 17
under the Exchange Act.

     (h) Other Transactions. On or prior to the Distribution Date, the parties
         ------------------
hereto shall have consummated those other transactions in connection with the
Distribution that are contemplated by the Registration Statements and not
specifically referred to in this Section 2.1.

     SECTION 2.2.   Credit Facility.  On or prior to the Distribution Date,
                    ---------------
Events will (i) enter into a credit facility with one or more financial
institutions, (ii) make term loan borrowings thereunder in an aggregate
principal amount of $330 million and (iii) after deducting the fees payable to
the lenders in connection with such borrowings, receive aggregate net proceeds
from these borrowings of $323,235,000. The terms of such credit facilities shall
be as described in the Registration Statements.

     SECTION 2.3.   Senior Debentures.  On or prior to the Distribution Date,
                    -----------------
Key3Media will issue and sell zero coupon senior debentures with an aggregate
initial principal amount of $75 million and warrants to purchase Key3Media
Common Stock and will receive aggregate net proceeds from such sale of
$72,937,500. The terms of such debentures and warrants shall be as described in
the Registration Statements. Promptly after it receives such net proceeds and
the net proceeds of the offering, Key3Media shall contribute all but $47.498
million of such combined net proceeds to Events.

     SECTION 2.4.    Repayment of Borrowings.  On or prior to the Distribution
                     -----------------------
Date, but after receiving the net proceeds (or portion thereof) of the
financings described in Sections 2.2 and 2.3 (collectively, the "Financings"),
                                                                 ----------
Events shall repay (i) the $150 million that it borrowed under the 364 Day
Revolving Credit Agreement, dated April 13, 2000 and (ii) the $232,002,000 it
owes to Ziff-Davis.

     SECTION 2.5.    Dividend to Ziff-Davis.  On or prior to the Distribution
                     ----------------------
Date but after the reorganization required by Section 2.1(a), Events shall
dividend to Key3Media, and thereafter Key3Media shall dividend to Ziff-Davis,
$42,998,000.

     SECTION 2.6.    Inter-Group Obligations.  The parties shall forgive
                     -----------------------
without consideration at the Effective Time (but after the repayment pursuant to
Section 2.4) any and all

                                      -7-
<PAGE>

amounts owing between any member of the Key3Media Group and any member of the
Ziff-Davis Group other than those arising under this Agreement, and each of the
parties agrees to indemnify and hold the other harmless from and against any
such liabilities after the Effective Time.

     SECTION 2.7.    Further Assurances.  In case at any time after the
                     ------------------
Effective Time any further action is reasonably necessary or desirable to carry
out the purposes of this Agreement, the proper officers of each party to this
Agreement shall take all such necessary action.

     SECTION 2.8.    Witness Services.  At all times from and after the
                     ----------------
Distribution Date, each of Ziff-Davis and Key3Media shall use their commercially
reasonable efforts to make available to the other, upon reasonable written
request, its Representatives as witnesses to the extent that (a) such persons
may reasonably be required in connection with the prosecution or defense of any
Action in which the requesting party from time to time be involved and (b) there
is no conflict in the Action between the requesting party and the other party. A
party providing witness services to the other party under this Section shall be
entitled to receive from the recipient of such services, upon the presentation
of invoices therefor, payments for such amounts, relating to disbursements and
other out-of-pocket expenses (which shall be deemed to exclude the costs of
salaries and benefits of employees who are witnesses), as may be reasonably
incurred in providing such witness services.

     SECTION 2.9.    Transition Services.  After the Distribution Date, if
                     -------------------
Key3Media requests that Ziff-Davis provide it with any transition services
reasonably required by Key3Media, the parties will consult in good faith to
determine whether Ziff-Davis can reasonably provide such services and the basis
on which such services, if any, will be provided.

     SECTION 2.10.    Corporate Names; Trademarks.  The parties agree that:
                      ---------------------------

     (a) as soon as reasonably practicable after the Distribution Date but in
any event within six months thereafter, Key3Media will, at its own expense,
remove (or, if necessary, on an interim basis, cover up) any and all exterior
signs and other identifiers located on any property or premises of or used by
any member of the Key3Media Group which refer or pertain to Ziff-Davis or which
include the Ziff-Davis name, logo or other trademark (including but not limited
to "Ziff-Davis" or "ZD" any similar marks or any derivatives thereof) or other
Ziff-Davis intellectual property (the "ZD Intellectual Property"); and
                                       ------------------------

     (b) as soon as is reasonably practicable after the Distribution Date but in
any event within six months thereafter, Key3Media will, and will cause its
Subsidiaries to, remove from all letterhead, envelopes, invoices and other
communications media of any kind that are to be used by Key3Media after the
Effective Time, all references to any of the ZD Intellectual Property (except
that Key3Media shall not be required to take any such action with respect to
materials in the possession of customers or to transactions currently in
progress).

                                      -8-
<PAGE>

                                  ARTICLE III

                                  DISTRIBUTION

     SECTION 3.1.    Distribution.  Subject to the conditions set forth in
                     ------------
Article IV:

     (a) On or prior to the Distribution Date, Ziff-Davis shall deliver to
Key3Media's stock transfer agent (the "Agent") the share certificate or
                                       -----
certificates representing the Key3Media Shares duly endorsed by Ziff-Davis in
blank, for the benefit of the record holders of Ziff-Davis Common Stock as of
the Distribution Record Date, and Ziff-Davis shall instruct the Agent to
distribute, on or as soon as practicable following the Distribution Date,
certificates representing such Key3Media Shares to such record holders as
contemplated by the Registration Statements and this Agreement. Key3Media shall
provide any share certificates or other documentation that the Agent shall
reasonably require in order to effect the Distribution.

     (b) No fractional shares of Key3Media Common Stock will be issued in the
Distribution; instead the Agent will aggregate all fractional shares to which
all the record holders of ZD Common Stock would otherwise be entitled into whole
shares and will sell the whole shares in the open market at then prevailing
prices as soon as practicable after the Distribution Date on behalf of such
holders. The Agent will distribute to each such holder such holder's ratable
share of the proceeds of such sale, net of brokerage commissions and other
expenses incurred in such sales, as soon as practicable after the Distribution
Date.

     (c) The Agent shall return to Ziff-Davis any Key3Media Shares, cash in lieu
of fractional shares and/or dividends or distributions with respect to the
Key3Media Shares that remain unclaimed by stockholders 180 days after the
Distribution Date ("Unclaimed Property") and thereafter such stockholders shall
                    ------------------
look only to Ziff-Davis for such Unclaimed Property, subject to applicable
escheat or other abandoned property laws.

     (d) Solely for purposes of computing fractional share interests, the
beneficial owner of shares of Ziff-Davis Common Stock held of record in the name
of a nominee will be treated as the holder of record of such shares.

                                   ARTICLE IV

                         CONDITIONS TO THE DISTRIBUTION

     SECTION 4.1.    Conditions to the Distribution.  The obligations of the
                     ------------------------------
parties hereto to consummate the Distribution are subject to the satisfaction or
waiver of each of the following conditions:

     (a)  Covenants.  Each of Ziff-Davis and Key3Media shall have taken in all
          ---------
material respects the actions required to be taken by it under this Agreement
prior to the Distribution;

                                      -9-
<PAGE>

     (b)  Listing of Key3Media Common Stock.  The Key3Media Common Stock shall
          ---------------------------------
have been approved for listing on the NYSE, subject to official notice of
issuance;

     (c)  Effectiveness of Registration Statements.  Each of the Registration
          ----------------------------------------
Statements shall been filed with the SEC and shall each have become effective,
and no stop order with respect to either of them shall be in effect;

     (d)  Governmental Authorizations.  All material authorizations, consents,
          ---------------------------
approvals and clearances of federal, state, local and foreign governmental
agencies required to permit the valid consummation by the parties hereto of the
transactions contemplated by this Agreement shall have been obtained; and no
such authorization, consent, approval or clearance shall contain any conditions
which would have a material adverse effect on the ability of Ziff-Davis or
Key3Media to perform its obligations under this Agreement and all statutory
requirements for such valid consummation shall have been fulfilled;

     (e)  No Stop Orders.  No preliminary or permanent injunction or other
          --------------
order, decree or ruling issued by a court of competent jurisdiction or by a
government, regulatory or administrative agency or commission, and no statute,
rule, regulation or executive order promulgated or enacted by any governmental
authority, shall be in effect preventing the consummation of this Agreement or
the Distribution;

     (f)  Execution and Delivery of Certain Agreements.  SOFTBANK Corp. and
          --------------------------------------------
Key3Media shall have executed and delivered the Registration Rights Agreement
and SOFTBANK Corp. shall have executed and delivered a Lock-Up Agreement in
substantially the form attached hereto as Exhibit C;

     (g)  Financings. Key3Media and Events shall have received the proceeds of
          ----------
the Financings and shall have made the contributions or loans, repayments and
dividends specified in Article II; and

     (h)  Instructions to Agent.  An officer of Ziff-Davis shall have
          ---------------------
instructed the Agent to make the Distribution effective.

     SECTION 4.2.    No Constraints.  Notwithstanding the provisions of
                     --------------
Section 4.1, the fulfillment or waiver of any or all of the conditions precedent
to the Distribution set forth therein shall not in any way limit Ziff-Davis'
right and power under Section 8.10 to terminate this Agreement and the process
leading to the Distribution and to abandon the Distribution or alter the
consequences of any such termination under Section 8.10 from those specified in
such Section.

     SECTION 4.3.    Deferral of the Distribution Date.  If the Distribution
                     ---------------------------------
Date shall have been established by the board of directors of Ziff-Davis but all
the conditions precedent to the Distribution set forth in this Agreement have
not theretofore been fulfilled or waived, or Ziff-Davis does not reasonably
anticipate that they will be fulfilled or waived, on or prior to the date
established as the Distribution Date, the Distribution shall not occur at the
time established and Ziff-Davis may, by resolution of its board of directors (or
a committee thereof, so authorized),

                                      -10-
<PAGE>

defer the Distribution Date to a later date. Subject to its right to terminate
this Agreement, Ziff-Davis shall cause the Distribution to occur as promptly as
is reasonably practicable.

     SECTION 4.4.    Public Notice of the Deferred Distribution Date. If the
                     -----------------------------------------------
Distribution Date is deferred in accordance with Section 4.3 and public
announcement of the prior Distribution Date has theretofore been made,
Ziff-Davis shall promptly thereafter issue a public announcement with respect to
such deferment and shall take such other actions as may be required by law or
deemed necessary or desirable with respect to the dissemination of such
information. Prior to any such public announcement, Ziff-Davis shall consult
with Key3Media concerning the content thereof.

                                   ARTICLE V

                                 INDEMNIFICATION

     SECTION 5.1.    Indemnification by Ziff-Davis.  Ziff-Davis shall indemnify
                     -----------------------------
and hold harmless the Key3Media Indemnitees from and against any and all
third-party claims that arise out of or result from (i) the Ziff-Davis
Businesses, (ii) the litigation listed on Schedule 5.1 or any shareholder
                                          ------------
derivative suits relating to or arising out of the Distribution or the
restructuring contemplated hereby, (iii) misstatements in or omissions from the
Registration Statements that relate to the Ziff-Davis Group or the Distribution,
(iv) Unclaimed Property, (v) the Distribution, except for those relating to the
Financings or described in clause (iii) of Section 5.2, (vi) any failure of the
ZD Retirement & Savings Plan to be fully funded as of the Distribution Date or
(vii) any breach of this agreement. Notwithstanding the foregoing, in no event
shall Ziff-Davis be required to indemnify and hold harmless Jason Chudnofsky
under this Agreement from and against any liabilities arising out of any
derivative suits or claims brought against him in his role as a director of
Ziff-Davis.

     SECTION 5.2.    Indemnification by Key3Media.  Key3Media shall indemnify
                     ----------------------------
and hold harmless the Ziff-Davis Indemnitees from and against any and all
third-party claims to the extent they arise out of or result from (i) the Events
Business, (ii) the litigation listed on Schedule 5.2, (iii) misstatements in or
                                        ------------
omissions from the Registration Statements that relate to the Key3Media Group,
the Financings, or the offering described in the Registration Statement or (iv)
any breach of this agreement.

     SECTION 5.3.    Procedures for Indemnification.
                     ------------------------------

     (a)  Third-Party Claims.  If a third-party claim is made against a
          ------------------
Key3Media Indemnitee or a Ziff-Davis Indemnitee (each, an "Indemnified Party")
                                                           -----------------
as to which such Indemnified Party is entitled to indemnification pursuant to
this Agreement, such Indemnified Party shall notify the party which is or may be
required pursuant to Section 5.1 or Section 5.2 hereof to make such
indemnification (the "Indemnifying Party") in writing, and in reasonable detail
                      ------------------
(to the extent available), of the third-party claim promptly (and in any event
within 15 Business Days) after receipt by such Indemnified Party of written
notice of the third-party claim; provided, however, that failure to give such
notification shall not affect the Indemnifying Party's indemnification
obligations provided hereunder except to the extent the Indemnifying Party shall

                                      -11-
<PAGE>

have been actually prejudiced as a result of such failure; and provided,
                                                               --------
further, that the Indemnifying Party shall not be liable for any expenses
-------
incurred during the period in which the Indemnified Party failed to give such
notice. Thereafter, the Indemnified Party shall deliver to the Indemnifying
Party, promptly (and in any event within ten Business Days) after the
Indemnified Party's receipt thereof, copies of all notices and documents
(including court papers) received by the Indemnified Party relating to the
third-party claim.

          If a third-party claim is made against an Indemnified Party, the
Indemnifying Party shall be entitled to participate in the defense thereof and,
if it so chooses, to assume the defense thereof with counsel selected by the
Indemnifying Party and reasonably acceptable to the Indemnified Party.  If the
Indemnifying Party elects to assume the defense of a third-party claim and
notifies the Indemnified Party of such election in writing, the Indemnifying
Party shall thereafter not be liable to the Indemnified Party for legal or other
expenses subsequently incurred by the Indemnified Party in connection with the
defense thereof; provided, however, that such Indemnified Party shall have the
                 --------  -------
right to employ counsel to represent such Indemnified Party if, in such
Indemnified Party's reasonable judgment, a conflict of interest between such
Indemnified Party and such Indemnifying Party exists in respect of such claim
which would make representation of both such parties by one counsel
inappropriate, and in such event the fees and expenses of one separate counsel
for all the Indemnified Parties party to such claim shall be paid by such
Indemnifying Party.  If the Indemnifying Party assumes such defense, the
Indemnified Party shall have the right to participate in the defense thereof
with separate counsel retained by it at its own expense (subject to the proviso
of the preceding sentence), it being understood and agreed, however, that the
Indemnifying Party and its counsel shall control such defense.  The Indemnifying
Party shall be liable for the reasonable fees and expenses of counsel employed
by the Indemnified Party during any period after the Indemnified Party shall
have given written notice to the Indemnifying Party of such third party claim
and before the Indemnifying Party shall have assumed the defense thereof.  If
the Indemnifying Party so elects to assume the defense of any third-party claim,
all of the Indemnified Parties shall cooperate with the Indemnifying Party in
the defense or prosecution thereof, including by providing or causing to be
provided, Records and witnesses as soon as reasonably practicable after
receiving any request therefor from or on behalf of the Indemnifying Party;
provided that the Indemnifying Party shall reimburse the Indemnified Parties for
--------
all of out-of-pocket expenses they incur in so cooperating.

          In no event will any Indemnified Party admit any liability with
respect to, or settle, compromise or discharge, any third-party claim for which
it is entitled to indemnity hereunder without the Indemnifying Party's prior
written consent; provided, however, that the Indemnified Party shall have the
                 --------  -------
right to settle, compromise or discharge such third-party claim without the
consent of the Indemnifying Party if the Indemnified Party releases the
Indemnifying Party from its indemnification obligation hereunder with respect to
such third-party claim and such settlement, compromise or discharge would not
otherwise adversely affect the Indemnifying Party.  The Indemnified Party will
agree to any settlement, compromise or discharge of a third-party claim that the
Indemnifying Party may recommend and that (i) by its terms obligates the
Indemnifying Party to pay the full amount of the liability in connection with
such third-party claim, (ii) does not contain any admission of guilt or fault on
the part of the Indemnified Party, (iii) releases the Indemnified Party
completely in connection with such third-party claim and (iv)

                                      -12-
<PAGE>

would not otherwise adversely affect the Indemnified Party. If an Indemnifying
Party elects not to assume the defense of a third-party claim, such Indemnified
Party may compromise, settle or defend such third-party claim.

          Notwithstanding the foregoing, the Indemnifying Party shall not be
entitled to assume the defense of any third-party claim (and shall be liable for
the fees and expenses of counsel incurred by the Indemnified Party in defending
such third-party claim) if the third-party claim seeks an order, injunction or
other equitable relief or relief for other than money damages against the
Indemnified Party which the Indemnified Party reasonably determines, after
conferring with its counsel, cannot be separated from any related claim for
money damages.  If such equitable relief or other relief portion of the third-
party claim can be so separated from that for money damages, the Indemnifying
Party shall be entitled to assume the defense of the portion relating to money
damages.

     (b) In the event of payment by an Indemnifying Party to any Indemnified
Party in connection with any third-party claim, then to the extent of such
payment such Indemnifying Party shall be subrogated to and shall stand in the
place of such Indemnified Party as to any events or circumstances in respect of
which such Indemnified Party may have any right or claim relating to such
third-party claim against any claimant or plaintiff asserting such third-party
claim. Such Indemnified Party shall cooperate with such Indemnifying Party in a
reasonable manner, and at the cost and expense of such Indemnifying Party, in
prosecuting any subrogated right or claim.

     (c) The remedies provided in this Article V shall be cumulative and shall
not preclude assertion by any Indemnified Party of any other rights or the
seeking of any and all other remedies against any Indemnifying Party.

     SECTION 5.4. Indemnification Payments.  (a)  Indemnification required by
                  ------------------------
this Article V shall be made by periodic payments of the amount thereof during
the course of the investigation or defense, as and when bills are received or
loss, liability, claim, damage or expense is incurred.

     (b) The amount of any claim by an Indemnified Party under this Agreement
shall be reduced to reflect any actual tax savings received by any Indemnified
Party that result from the Indemnifiable Losses that gave rise to such
indemnity.

                                   ARTICLE VI

                                       TAX

     SECTION 6.1.    Liability for Taxes and Related Matters
                     ---------------------------------------

                                      -13-
<PAGE>

     (a)  Liability for Taxes.  Ziff-Davis shall be liable for, shall indemnify
          -------------------
and hold Key3Media harmless from and against, and shall make payment of (i) any
Income Tax imposed on any member of the Ziff-Davis Group and the Key3Media Group
attributable to any Income Tax period ending prior to or on the Distribution
Date (the "Pre-Distribution Period"), (ii) any Income Taxes for a
           -----------------------
Pre-Distribution Period resulting from or attributable to transactions described
in this Distribution Agreement, including, without limitation, the distribution
of the Key3Media stock in the Distribution, (iii) any Income Taxes for which any
member of the Key3Media Group is or may be liable as a result of being
affiliated with the Ziff-Davis Group or any prior affiliated group under
Treasury Regulation Section 1502-6 or any similar provision of foreign, state,
local law or under a transferee liability or similar theory, (iv) with respect
to any Income Tax periods that begin before but end after the Distribution Date,
Income Taxes imposed for the portion of such periods that are deemed to close on
the Distribution Date pursuant to Section 6.1(c), (v) any payroll, Social
Security, Medicare, unemployment, pension or similar state, local or foreign
Taxes attributable to any Pre-Distribution Period for which the Ziff-Davis Group
processed the payroll for the Key3Media Group, except to the extent such
liability of the Ziff- Davis Group is attributable to information provided to
the Ziff-Davis Group by Key3Media, and (vi) any foreign Tax attributable to any
Pre-Distribution Period. Ziff-Davis shall be entitled to any refund of (x)
Income Taxes received by the Key3Media Group attributable to any Pre-
Distribution Period and any portion of the periods for which Ziff-Davis is
liable under this Section 6.1(a)(i), (ii), (iii) and (iv), and (y) other Taxes
for which Ziff-Davis is liable under Section 6.1(a)(v) or (vi).

     (b) Key3Media shall be liable for, shall indemnify and hold Ziff-Davis
harmless from and against and shall make payments of (i) the Income Taxes of all
members of the Key3Media Group for any taxable year or period that begins on the
day after the Distribution Date and, with respect to any taxable year or period
beginning before and ending after the Distribution Date, the portion of such
taxable year beginning on the day after the Distribution Date and (ii) the Taxes
of all members of the Key3Media Group for any period, other than any Taxes for
which Ziff-Davis is liable under Section 6.1(a)(v)-(vi). Key3Media shall be
entitled to any refund of Taxes and Income Taxes of all members of the Key3Media
Group received for such periods except for any Income Taxes or Taxes for which
Ziff-Davis is liable under Section 6.1(a)(i)-(vi).

     (c) Taxes for Short Taxable Year. For purposes of determining the liability
         ----------------------------
for Income Taxes of the Ziff-Davis Group and Key3Media with respect to any
Income Tax periods or years that begin before the Distribution Date but do not
end on the Distribution Date, there shall be deemed to be a short Income Tax
period closing on the Distribution Date and another short Income Tax period
beginning on the day immediately following the Distribution Date. Any items of
income, deductions, expenditures and Income Tax attributes shall be allocated
between these two short Income Tax periods on the basis of the closing of the
books method as of the end of the day at the Distribution Date, except that
exemptions, allowances or deductions that are calculated on an annual basis
shall be prorated on the basis of the number of days in the applicable period
that elapsed through the Distribution Date. The Ziff-Davis Group shall be liable
for any Income Taxes attributable to the short Income Tax period deemed to close
on the Distribution Date, and Key3Media shall be liable for any Income Taxes
attributable to the short Income Tax period beginning on the day immediately
following the Distribution Date.

                                      -14-
<PAGE>

     (d) Refunds from Carrybacks. Key3Media shall, if permissible under
         -----------------------
applicable law, make the election under Treasury Regulations Section 1.1502-
21(b)(3)(i) or comparable provisions of state, local or foreign law to
relinquish the carryback period for any post-Distribution Date net operating
losses or other Income Tax attributes. To the extent such an election is not
permissible, the parties agree to cooperate in the filing of a refund claim and
to allocate the benefits of any such carryback on an equitable basis.

     (e)  Tax Returns.
          -----------

               (i) Ziff-Davis shall file or cause to be filed when due all
          Income Tax Returns that are required to be filed by or with respect to
          any member of the Key3Media Group for Pre-Distribution Periods and
          shall pay all Income Taxes due with respect to such Income Tax
          Returns.

               (ii) With respect to the Income Tax Returns for Income Tax
          periods ending in 1999, Ziff-Davis shall provide Key3Media with a
          draft of the Income Tax Returns (or in the case of a consolidated,
          combined or unitary Income Tax Return, a Pro-Forma Income Tax Return)
          together with any relevant Income Tax Returns Supporting
          Documentation, with respect to Key3Media as soon as practicable prior
          to the due date for filing of Ziff Davis's 1999 consolidated federal
          Income Tax Return. Ziff-Davis will consult in good faith with
          Key3Media with respect to any comments and suggestions made by
          Key3Media with respect to such Income Tax Returns. The parties shall
          attempt to resolve in good faith any disagreement or dispute with
          respect to any disputed items. The ultimate resolution of any disputed
          items will be determined by Ziff-Davis in its sole and absolute
          discretion.

               (iii) With respect to the Income Tax Returns for Income Tax
          periods ending after December 31, 1999 but before the Distribution
          Date, Ziff-Davis shall provide Key3Media with a draft of a Pro-Forma
          Income Tax Return and any relevant Income Tax Returns Supporting
          Documentation with respect to Key3Media as soon as practicable but no
          later than August 15, 2001. Ziff-Davis will consult in good faith with
          Key3Media with respect to any comments and suggestions made by
          Key3Media with respect to such Income Tax Returns. The parties shall
          attempt to resolve in good faith any disagreement or dispute with
          respect to any disputed items. The ultimate resolution of any disputed
          items will be determined by Ziff-Davis in its sole and absolute
          discretion.

               (iv) Key3Media shall file or cause to be filed any Income Tax
          Returns (other than consolidated, combined or unitary Income Tax
          Returns that include Income Taxes of Key3Media and Ziff-Davis) due
          that are required to be filed by or with respect to the Key3Media
          Group for any Income Tax periods ending after the Distribution Date
          and pay any Income Taxes due. With respect to such Income Tax Returns
          for Tax periods ending in 2000 for which Ziff-Davis may be liable
          under Section 6.1(a) (i.e. to which Section 6.1(c) applies), Key3Media
          shall

                                      -15-
<PAGE>

          provide Ziff-Davis with a draft of any Income Tax Returns for such
          periods at least seventy-five (75) days prior to the due date for
          filing of any such Tax Returns. Key3Media will consult in good faith
          with Ziff-Davis with respect to any comments and suggestions made by
          Ziff-Davis with respect to such Income Tax Returns. The parties shall
          attempt to resolve in good faith any disagreement or dispute with
          respect to any disputed items. The ultimate resolution of any disputed
          items will be determined by Key3Media in its sole and absolute
          discretion.

          (f) Contest Provisions.
              ------------------

          Key3Media shall promptly notify Ziff-Davis in writing upon receipt by
Key3Media or any of its affiliates of notice of any pending or threatened audits
or assessments which may affect the Tax or Income Tax liabilities of any member
of the Key3Media Group for which Ziff-Davis would be required to indemnify
Key3Media pursuant to Section 6.1(a), provided that failure to comply with this
provision shall not affect Key3Media's right to indemnification hereunder unless
Ziff-Davis is prejudiced thereby. Ziff-Davis shall promptly notify Key3Media in
writing of any pending or threatened Income Tax or Tax audit or controversy that
could affect any member of the Key3Media Group for any Pre-Distribution Period,
provided that failure to comply with this provision shall not require Ziff-Davis
to indemnify Key3Media for the effects of such failure unless Key3Media is
prejudiced by the failure of Ziff-Davis to notify Key3Media.  Ziff-Davis shall
have the sole right to represent any member of the Key3Media Group's interests
in any Income Tax or Tax audit or administrative or court proceeding relating to
taxable periods ending on or before the Distribution Date, to employ counsel of
its choice at its expense and to settle any such audit or proceeding in its sole
and absolute discretion; provided, however, that Ziff-Davis shall consult in
good faith with Key3Media with respect to any comments and suggestions made in
this regard by Key3Media.

          Ziff-Davis shall be entitled to participate at its expense in the
defense of any claim for Income Taxes or Taxes for a year or period ending after
the Distribution Date which may be the subject of indemnification by Ziff-Davis
pursuant to Section 6.1(a) and, with the written consent of Key3Media, and at
its sole expense, may assume the entire defense of such Income Tax or Tax claim.
Key3Media may not agree to settle any Income Tax or Tax claim for the portion of
the year or period ending on the Distribution Date which may be the subject of
indemnification by Ziff-Davis under Section 6.1(a) without the prior written
consent of Ziff-Davis, which consent shall not be unreasonably withheld.

     (g) Termination of Tax Allocation Agreements. Any tax allocation or sharing
         ----------------------------------------
agreement or arrangement, whether or not written, that may have been entered
into by Ziff-Davis or any member of the Ziff-Davis Group and any member of the
Key3Media Group shall be terminated as to each member of the Key3Media Group as
of the Distribution Date, and no payments which are owed by or to the Key3Media
Group pursuant thereto shall be made thereunder.

                                      -16-
<PAGE>

     SECTION 6.2.    Transfer Taxes.  Ziff-Davis shall hold Key3Media harmless,
                     --------------
shall indemnify Key3Media, and shall pay any and all Taxes arising with respect
to or as a result of any transfer of property (including stock) under the
Distribution Agreement or the distribution of the Key3Media stock pursuant to
the Distribution Agreement.

     SECTION 6.3.    Information to be Provided by Key3Media.  With respect to
                     ---------------------------------------
the taxable year of Ziff-Davis ending December 31, 1999 and the period in 2000
prior to the Distribution Date, Key3Media shall promptly prepare or cause to be
prepared and provide to Ziff-Davis a package of Income Tax information materials
(the "Tax Package"), which shall be completed in accordance with past practice
including past practice as to providing the information, schedules and work
papers and as to the method of computation of separate taxable income or other
relevant measure of income of the members of the Key3Media Group. Key3Media
shall cause the Tax Package for the taxable year of Ziff-Davis ending December
31, 1999 to be delivered no later than forty-five (45) days before the due date
for the Ziff-Davis Federal Income Tax Return required to be filed for that
period, and shall cause the Tax Package for the portion of the taxable period
ending on the Distribution Date to be delivered to Ziff-Davis within one-hundred
and fifty (150) days after the Distribution Date.

     SECTION 6.4.    Payments.  Failure to make any payment required under this
                     --------
Agreement will result in the accrual of interest on such amount due. Any
interest payment required hereunder shall be calculated from the date of the
failure to make any payments required under this Agreement, at the rate used by
the Internal Revenue Service (the "IRS"), any foreign, state, or local tax
authority, as applicable, in computing the interest payable by it or to it.
Unless otherwise provided, all payments required to be made under this Agreement
from one party to another shall be made within thirty (30) days after the event
which gives rise to the requirement for payment occurs.

     SECTION 6.5.    Treatment of Intercompany Payments.  To the extent that
                     ----------------------------------
any payments are made between Key3Media and Ziff-Davis pursuant to this
Agreement, for purposes of Income Tax treatment, such payments to Ziff-Davis by
Key3Media shall be treated as a distribution under Section 301 of the Code by
Key3Media to Ziff-Davis at a time when the two corporations filed a consolidated
federal Income Tax return, and such payments by Ziff-Davis to Key3Media shall be
treated as a nontaxable contribution by Ziff-Davis to the capital of Key3Media
immediately prior to the Distribution Date.

     SECTION 6.6.    Tax Attributes.  The Ziff-Davis Group shall be entitled
                     --------------
to the benefits of any net operating losses or other Income Tax attributes
generated by Key3Media while a member of the Ziff-Davis Group that can be
utilized by the Ziff-Davis Group in any Income Tax periods prior to and
including the Income Tax period which includes the Distribution Date. Key3Media
will not be compensated for use of any such Income Tax attributes by the
Ziff-Davis Group. To the extent such net operating losses and Income Tax
attributes are not absorbed by the Ziff-Davis Group, Key3Media shall be entitled
to carry forward to any post-Distribution Income Tax periods any net operating
loss or other Income Tax attributes generated while any of the Key3Media
Entities had been a member of the Ziff-Davis

                                      -17-
<PAGE>

Group and which are properly allocated to Key3Media under Treasury Regulation
Section 1.1502-21(b) or other provisions of the Regulations or comparable state,
local or foreign law.

     SECTION 6.7.    Assistance and Cooperation.  After the Distribution Date,
                     --------------------------
     (a) each of Ziff-Davis and Key3Media shall:

             (i) reasonably assist (and cause their respective affiliates to
     reasonably assist) the other party in preparing any Tax Returns, Income Tax
     Returns or reports which such other party is responsible for preparing and
     filing in accordance with this Article VI;

             (ii) cooperate fully in preparing for any audits of, or disputes
     with taxing authorities regarding, any Tax Returns or Income Tax Returns of
     any member of the Key3Media Group;

             (iii) make available to the other and to any taxing authority as
     reasonably requested all information, records, and documents relating to
     Taxes or Income Tax of any member of the Key3Media Group or any member of
     the Key3Media Group while a direct or indirect subsidiary of Ziff-Davis;

             (iv) provide timely notice to the other in writing of any pending
     or threatened Tax or Income Tax audits or assessments of the Key3Media
     Group or any member of the Key3Media Group while a direct or indirect
     subsidiary of Ziff-Davis for taxable periods for which the other party may
     have a liability under this Article VI;

             (v) furnish the other with copies of all correspondence received
     from any taxing authority in connection with any Tax or Income Tax audit or
     information request with respect to any such taxable period; and

     (b) Ziff-Davis shall prepare and deliver to Key3Media and an independent
accounting firm of national standing appointed by Key3Media that is reasonably
satisfactory to Ziff-Davis as soon as practicable but not later than August 15,
2001, a schedule of all Income Tax attributes than can be carried forward and a
calculation of all limitations on any Income Tax-related deductions or credits.
Key3Media and such accounting firm shall be entitled to review such schedule and
calculation, and shall notify Ziff-Davis of any comments or suggestions relating
thereto no later than 15 days after receipt of such schedule and calculation.
Ziff-Davis will consult in good faith with Key3Media and such accounting firm
with respect to any such comments and suggestions. Ziff-Davis will provide such
accounting firm (but not Key3Media) with all information reasonably requested by
such accounting firm in order for it to review such schedule and calculation or
perform any additional calculations that it deems necessary, at any time after
delivery of such schedule and calculation. Such accounting firm shall not
disclose any information received with respect to the Tax Returns, Income Tax
Returns or Income Tax Returns Supporting Documentation of any member of the
Ziff-Davis Group to any other person, including Key3Media; and

     (c) Ziff-Davis shall promptly notify Key3Media of (i) any event that may
adversely affect any post Distribution Income Tax Return or Tax Return of the
Key3Media Group, (ii) any recalculation of Income Tax attributes or benefits for
any Pre-Distribution Period that were previously allocated to Key3Media pursuant
to Section 6.6 and carried forward to a post-distribution period, and (iii) the
intention to file any amended Income Tax Return or Tax Return for any
Pre-Distribution Period that may affect any member of the Key3Media Group, and
shall provide Key3Media with such information that is required by Key3Media to
accurately prepare all Tax Returns and Income Tax Returns (including amendments
thereto) for any post-Distribution period.

                                      -18-
<PAGE>

     SECTION 6.8.    Survival of Obligations.  The obligations of the parties
                     -----------------------
set forth in this Article VI shall be unconditional and absolute and shall
remain in effect without limitation as to time.

                                  ARTICLE VII

                              ACCESS TO INFORMATION

     SECTION 7.1.    Provision of Corporate Records.
                     ------------------------------

     (a) After the date hereof, upon the prior written request by Key3Media for
specific and identified agreements, documents, books, records or files
(collectively, "Records") in the possession or control of any member of the
                -------
Ziff-Davis Group which relate to Key3Media or the conduct of the Events Business
prior to the Effective Time, Ziff-Davis shall arrange, as soon as reasonably
practicable following the receipt of such request, to provide the originals of
any such Records not already in the possession or control of a member of the
Key3Media Group (or, if it would be burdensome for Ziff-Davis to provide the
originals, copies thereof).

     (b) After the date hereof, upon the prior written request by Ziff-Davis for
specific and identified Records in the possession or control of any member of
the Key3Media Group which relate to the Ziff-Davis Group or the conduct of the
Ziff-Davis Business prior to the Effective Time, Key3Media shall arrange, as
soon as reasonably practicable following the receipt of such request, to provide
the originals of any such Records not already in the possession or control of a
member of the Ziff-Davis Group (or, if it would be burdensome for Key3Media to
provide the originals, copies thereof).

     SECTION 7.2.    Access to Information.  From and after the date hereof,
                     ---------------------
each of Ziff-Davis and Key3Media shall afford to the other and its authorized
Representatives reasonable access during normal business hours, subject to
appropriate restrictions for classified, privileged or confidential information,
to the personnel, properties, books and records of such party and its
Subsidiaries insofar as such access is reasonably required by the other party
and relates to such other party or the conduct of its business prior to the
Effective Time or is necessary to conduct such other party's business after the
Effective Time.

     SECTION 7.3.   Confidentiality.  Neither (a) Ziff-Davis nor any of its
                    ---------------
Subsidiaries nor (b) Key3Media nor any of its Subsidiaries shall use or permit
the use of (without the prior written consent of the other) and shall keep, and
shall cause its Representatives to keep, confidential all information concerning
the other party and its Subsidiaries in its possession, its custody or under its
control (except to the extent that (i) such information has become publicly
available through no fault of such party or (ii) such information has been later
lawfully acquired from other sources by such party or (iii) this Agreement
permits the use or disclosure of such information) to the extent such
information was acquired during the period prior to the Effective Time, and each
party shall not (without the prior written consent of the other) otherwise
release or disclose such information to any other Person, except such party's
auditors, attorneys, consultants and advisors, except to the extent (and only to
the extent) that disclosure of such information is required by Law, judicial or
administrative process or the rules of any stock

                                      -19-
<PAGE>

exchange upon which such party's securities are listed if, prior to such
disclosure, such party has used commercially reasonable efforts to consult with
the other affected party or parties.

     SECTION 7.4.    Privileged Matters.  The parties hereto recognize that
                     ------------------
legal and other professional services that have been and will be provided prior
to the Distribution Date have been and will be rendered for the benefit of each
of the members of the Ziff-Davis Group, and the members of the Key3Media Group,
and that each of the members of the Ziff-Davis Group, and each of the members
of the Key3Media Group should be deemed to be the client for the purposes of
asserting all privileges which may be asserted under applicable Law. To allocate
the interests of each party in the information as to which any party is entitled
to assert a privilege, the parties agree as follows:

     (a) Ziff-Davis shall be entitled, in perpetuity, to control the assertion
or waiver of all privileges in connection with privileged information which
relates solely to the Ziff-Davis Business, whether or not the privileged
information is in the possession of or under the control of Ziff-Davis or
Key3Media. Ziff-Davis shall also be entitled, in perpetuity, to control the
assertion or waiver of all privileges in connection with privileged information
that relates solely to the subject matter of any claims listed on Schedule 5.1,
now pending or which may be asserted in the future, in any lawsuits or other
proceedings initiated against or by Ziff-Davis, whether or not the privileged
information is in the possession of or under the control of Ziff-Davis or
Key3Media.

     (b) Key3Media shall be entitled, in perpetuity, to control the assertion or
waiver of all privileges in connection with privileged information which relates
solely to the Events Business, whether or not the privileged information is in
the possession of or under the control of Ziff-Davis or Key3Media. Key3Media
shall also be entitled, in perpetuity, to control the assertion or waiver of all
privileges in connection with privileged information that relates solely to the
subject matter of any claims listed on Schedule 5.2, now pending or which may be
asserted in the future, in any lawsuits or other proceedings initiated against
or by Key3Media, whether or not the privileged information is in the possession
of or under the control of Ziff-Davis or Key3Media.

     (c) The parties hereto agree that they shall have a shared privilege, with
equal right to assert or waive, subject to the restrictions in this Section 7.5,
with respect to all privileges not allocated pursuant to the terms of Sections
7.5(a) and (b). All privileges relating to any claims, proceedings, litigation,
disputes, or other matters which involve Ziff-Davis and Key3Media in respect of
which such parties retain any responsibility or liability under this Agreement,
shall be subject to a shared privilege among them.

     (d) No party hereto may waive any privilege which could be asserted under
any applicable Law, and in which any other party hereto has a shared privilege,
without the consent of the other party, which consent shall not be unreasonably
withheld or delayed, except to the extent reasonably required in connection with
any litigation with third parties or as provided in subsection (e) below.
Consent shall be in writing, or shall be deemed to be granted unless written
objection is made within twenty (20) days after notice upon the other party
requesting such consent.

                                      -20-
<PAGE>

     (e) In the event of any litigation or dispute between or among any of the
parties hereto, any party and a Subsidiary of another party hereto, or a
Subsidiary of one party hereto and a Subsidiary of another party hereto, either
such party may waive a privilege in which the other party has a shared
privilege, without obtaining the consent of the other party, provided that such
waiver of a shared privilege shall be effective only as to the use of
information with respect to the litigation or dispute between the relevant
parties and/or their Subsidiaries, and shall not operate as a waiver of the
shared privilege with respect to third parties. To the extent practicable in the
circumstances, the party to the litigation shall seek to have such information
kept under seal or otherwise kept confidential in such litigation.

     (f) If a dispute arises between or among the parties hereto or their
respective Subsidiaries regarding whether a privilege should be waived to
protect or advance the interest of any party, each party agrees that it shall
negotiate in good faith, shall endeavor to minimize any prejudice to the rights
of the other parties, and shall not unreasonably withhold consent to any request
for waiver by another party. Each party hereto specifically agrees that it will
not withhold consent to waiver for any purpose except to protect its own
legitimate interests.

     (g) Upon receipt by any party hereto or by any Subsidiary thereof of any
subpoena, discovery or other request which arguably calls for the production or
disclosure of information subject to a shared privilege or as to which another
party has the sole right hereunder to assert a privilege, or if any party
obtains knowledge that any of its or any of its Subsidiaries' current or former
directors, officers, agents or employees have received any subpoena, discovery
or other requests which arguably calls for the production or disclosure of such
privileged information, such party shall promptly notify the other party of the
existence of the request and shall provide the other party a reasonable
opportunity (to the extent it is available) to review the information and to
assert any rights it or they may have under this Section 7.5 or otherwise to
prevent the production or disclosure of such privileged information.

     (h) The transfer of all Records and other information pursuant to this
Agreement is made in reliance on the agreement of Ziff-Davis and Key3Media, as
set forth in Sections 7.4 and 7.5, to maintain the confidentiality of privileged
information and to assert and maintain all applicable privileges. The access to
information being granted pursuant to Sections 7.4 and 7.5 hereof, the agreement
to provide witnesses and individuals pursuant to Section 2.9, and the transfer
of privileged information between and among the parties and their respective
Subsidiaries pursuant to this Agreement shall not be deemed a waiver of any
privilege that has been or may be asserted under this Agreement or otherwise.

     SECTION 7.5. Ownership of Information.  Any information owned by one party
                  ------------------------
or any of its Subsidiaries that is provided to a requesting party pursuant to
Section 7.4 shall be deemed to remain the property of the providing party.
Unless specifically set forth herein, nothing contained in this Agreement shall
be construed as granting or conferring rights of license or otherwise in any
such information.

     SECTION 7.6. Retention of Records.  Ziff-Davis shall deliver to
                  --------------------
Key3Media upon Key3Media's request all Records that are specifically identified
by Key3Media and known

                                      -21-
<PAGE>

by Ziff-Davis, after reasonable inquiry, to be in its control or possession
relating to the Events Business. Except when a longer retention period is
otherwise required by Law or agreed to in writing, Ziff-Davis and Key3Media
shall retain, for a period of at least six years, all Records relating to the
Events Business existing as of the Effective Time. Notwithstanding the
foregoing, in lieu of retaining any specific Records, Ziff-Davis or Key3Media
may offer in writing to deliver such Records to the other and, if such offer is
not accepted within 90 days, the offered Records may be destroyed or otherwise
disposed of at any time. If a recipient of such offer shall request in writing
prior to the scheduled date for such destruction or disposal that any of the
Records proposed to be destroyed or disposed of be delivered to such requesting
party, the party proposing the destruction or disposal shall promptly arrange
for delivery of such of the Records as was requested (at the cost of the
requesting party).

     SECTION 7.7.    Limitation of Liability; Release.  Effective upon the
                     --------------------------------
Distribution and except as otherwise specifically set forth in this Agreement,
each of Ziff-Davis and Key3Media on behalf of itself and each member of the
Ziff-Davis Group and the Key3Media Group, respectively, releases and forever
discharges the other and its Representatives and Subsidiaries, of and from all
debts, demands, actions, causes of action, suits, accounts, covenants,
contracts, agreements, damages, and any and all claims, demands and liabilities
whatsoever of every name and nature, both in law and in equity, against such
other party, its Representatives and Subsidiaries or any of its assigns, which
the releasing party has or ever had, which arise out of or relate to events,
circumstances or actions taken by such other party prior to the Distribution;
provided, however, that the foregoing general release shall not apply to this
Agreement or the transactions contemplated hereby and shall not affect either
party's right to enforce this Agreement in accordance with its terms.

                                  ARTICLE VIII

                                  MISCELLANEOUS

     SECTION 8.1.    Complete Agreement; Construction.  This Agreement,
                     --------------------------------
including the Exhibits and Schedules, shall constitute the entire agreement
between the parties with respect to the subject matter hereof and shall
supersede all previous negotiations, commitments and writings with respect to
such subject matter. In the event of any inconsistency between this Agreement
and any Schedule hereto, the Schedule shall prevail.

     SECTION 8.2.    Counterparts.  This Agreement may be executed in one or
                     ------------
more counterparts, all of which shall be considered one and the same agreement,
and shall become effective when one or more such counterparts have been signed
by each of the parties and delivered to the other parties.

     SECTION 8.3.    Survival of Agreements.  Except as otherwise contemplated
                     ----------------------
by this Agreement, all covenants and agreements of the parties contained in this
Agreement shall survive the Distribution Date.

     SECTION 8.4.    Distribution Expenses.  Except for the bank commitment
                     ---------------------
fees of $6.765 million and the $2.0625 million discount payable to the lenders
in connection with the Financings, the listing fees payable to the

                                      -22-
<PAGE>

NYSE in respect of the Key3Media Common Stock, the fees and disbursements of
Mayer, Brown and Platt and as otherwise provided in this Agreement, all costs
and expenses incurred in connection with the preparation, execution, delivery,
printing and implementation of this Agreement, the Registration Statements and
the Distribution and the consummation of the transactions contemplated thereby
(collectively, the "Transaction Expenses") shall be charged to and paid by
                    --------------------
Ziff-Davis. The Transaction Expenses shall not include expenses incurred by
Key3Media or the Events Subsidiaries relating to the conduct of, or changes to,
their businesses. Except as otherwise set forth in this Agreement, each party
shall bear its own costs and expenses from and after the Distribution Date. Any
amount or expense to be paid or reimbursed by any party hereto to any other
party hereto shall be so paid or reimbursed promptly after the existence and
amount of such obligation is determined and written demand therefor is made.

     SECTION 8.5.    Notices.  All notices and other communications hereunder
                     -------
shall be in writing, shall reference this Agreement and shall be hand delivered
or mailed by registered or certified mail (return receipt requested) or sent by
any means of electronic message transmission with delivery confirmed (by voice
or otherwise) to the parties at the following addresses (or at such other
addresses for a party as shall be specified by like notice) and will be deemed
given on the date on which such notice is received ("Notices"):
                                                     -------

          To Ziff-Davis:

                    Chief Executive Officer
                    Ziff-Davis Inc.
                    28 East 28th Street
                    New York, New York 10016

                    Telephone:  (212) 503-3500
                    Facsimile:   (212) 503-5075

          To Key3Media:

                    Chief Executive Officer
                    Key3Media Group, Inc.
                    5700 Wilshire Boulevard, Suite 325
                    Los Angeles, California 90036

                    Telephone:  (323) 954-3000
                    Facsimile:   (323) 954-3010

     SECTION 8.6.    Waivers.  The failure of any party to require strict
                     -------
performance by any other party of any provision in this Agreement will not waive
or diminish that party's right to demand strict performance thereafter of that
or any other provision hereof.

     SECTION 8.7.    Amendments.  Subject to the terms of Section 8.10 hereof,
                     ----------
this Agreement may not be modified or amended except by an agreement in writing
signed by each of the parties hereto.

                                      -23-
<PAGE>

     SECTION 8.8.     Assignment.  This Agreement shall not be assignable, in
                      ----------
whole or in part, directly or indirectly, by any party hereto without the prior
written consent of the other party hereto, which consent shall not be
unreasonably withheld and provided that the assignee shall remain liable for its
obligations hereunder, and any attempt to assign any rights or obligations
arising under this Agreement without such consent shall be void.

     SECTION 8.9.     Successors and Assigns.  The provisions to this Agreement
                      ----------------------
shall be binding upon, inure to the benefit of and be enforceable by the parties
and their respective successors and permitted assigns.

     SECTION 8.10.    Termination.  This Agreement (including Article V) may
                      -----------

be terminated and the Distribution may be amended, modified or abandoned at any
time prior to the Distribution by and in the sole discretion of Ziff-Davis
without the approval of Key3Media. In the event of such termination, no party
shall have any liability of any kind to any other party or any other person
arising out of this Agreement. After the Distribution, this Agreement may not be
terminated except by an agreement in writing signed by the parties; provided,
                                                                    --------
however, that Article V shall not be terminated or amended after the
-------
Distribution in respect of the third party beneficiaries thereto without the
consent of such persons.

     SECTION 8.11.    Subsidiaries.  Each of the parties hereto shall cause to
                      ------------
be performed, and hereby guarantees the performance of, all actions, agreements
and obligations set forth herein to be performed by any Subsidiary of such party
or by any entity that is contemplated to be a Subsidiary of such party on and
after the Distribution Date.

     SECTION 8.12.    Third Party Beneficiaries.  Except as provided in
                      -------------------------
Article V relating to Indemnified Parties, this Agreement is solely for the
benefit of the parties hereto and their respective Subsidiaries and Affiliates
and should not be deemed to confer upon third parties any remedy, claim,
liability, reimbursement, claim of action or other right in excess of those
existing without reference to this Agreement.

     SECTION 8.13.    Title and Headings.  Titles and headings to sections
                      ------------------
herein are inserted for convenience of reference only and are not intended to be
a part of or to affect the meaning or interpretation of this Agreement.

     SECTION 8.14.    Exhibits and Schedules.  The Exhibits and Schedules shall
                      ----------------------
be construed with and as an integral part of this Agreement to the same extent
as if the same had been set forth verbatim herein.

     SECTION 8.15.    GOVERNING LAW.  THIS AGREEMENT SHALL BE GOVERNED BY AND
                      -------------
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO
CONTRACTS MADE AND TO BE PERFORMED IN THE STATE OF NEW YORK.

     SECTION 8.16.    Consent to Jurisdiction.  Without limiting the provisions
                      -----------------------
of Article V hereof, each of the parties irrevocably submits to the exclusive
jurisdiction of (a) the state courts of the State of New York, located in The
City of New York, and (b) the United States District Court for the Southern
District of Manhattan, for the purposes of any suit, action

                                      -24-
<PAGE>

or other proceeding arising out of this Agreement or any transaction
contemplated hereby. Each of the parties agrees to commence any action, suit or
proceeding relating hereto either in the United States District Court for the
Southern District of Manhattan or if such suit, action or other proceeding may
not be brought in such court for jurisdictional reasons, in the state courts of
the State of New York, located in the City of New York. Each of the parties
further agrees that service of any process, summons, notice or document by U.S.
registered mail to such party's respective address set forth above shall be
effective service of process for any action, suit or proceeding in New York with
respect to any matters to which it has submitted to jurisdiction in this Section
8.16. Each of the parties irrevocably and unconditionally waives any objection
to the laying of venue of any action, suit or proceeding arising out of this
Agreement or the transactions contemplated hereby in (i) the state courts of the
State of New York, located in The City of New York, or (ii) the United States
District Court for the Southern District of Manhattan, and hereby further
irrevocably and unconditionally waives and agrees not to plead or claim in any
such court that any such action, suit or proceeding brought in any such court
has been brought in an inconvenient forum.

     SECTION 8.17.    Severability.  In the event any one or more of the
                      ------------
provisions contained in this Agreement should be held invalid, illegal or
unenforceable in any respect, the validity, legality and enforceability of the
remaining provisions contained herein and therein shall not in any way be
affected or impaired thereby. The parties shall endeavor in good-faith
negotiations to replace the invalid, illegal or unenforceable provisions with
valid provisions, the economic effect of which comes as close as possible to
that of the invalid, illegal or unenforceable provisions.

                                      -25-
<PAGE>

          IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed as of the day and year first above written.

                                          ZIFF-DAVIS INC.

                                          By__________________________________
                                             Name:
                                             Title:

                                          KEY3MEDIA GROUP, INC.

                                          By__________________________________
                                             Name:
                                             Title:
<PAGE>

                                   EXHIBIT A

                              Events Subsidiaries

1.  Key3Media Events, Inc.
2.  Key3Media Events Pty Ltd., an Australian corporation
3.  ZD Events S.A., a Mexican corporation
4.  Key3Media S.A., a French corporation
<PAGE>

                                   EXHIBIT B

                         Registration Rights Agreement
<PAGE>

                                   EXHIBIT C

                               Lock-Up Agreement
<PAGE>

                                  SCHEDULE 5.1

                   Certain Third-Party Claims Arising Out of

                            the Ziff-Davis Business

     In re Ziff-Davis Inc. Securities Litigation, U.S. District Court, Southern
District of New York; Master File No. 98 Civ. 7158 (SWK)

     In re Ziff-Davis Inc. Derivative Litigation, Court of Chancery of the State
of Delaware for New Castle County, Consolidated C.A. No. 16813NC
<PAGE>

                                  SCHEDULE 5.2
                    Certain Third-Party Claims Arising Out of
                               the Events Business

  Joseph W. Ott v. GES Exposition Service, Premier Displays & Exhibits CO,
Softbank Comdex, J.R. Lighting, EZC International, Dynapac Rotating Co., Inc. -
Filed in District Court, Clark County, NV

  Hope Morreale v. ZD Comdex & Forums - Filed in Massachusetts Commission
Against Discrimination

  Feese, Sandra v. ZD Events Inc. - Filed at EEOC San Francisco District Office

  Frederick Baumgartner v. ZD Comdex & Forums, et al

  ZD Events Inc. v. GES Exposition Services, Inc. (U.S. District Court)
(Massachusetts) C.A. No. 00 CV 0505-DPW.

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