Exhibit 2
February 25, 1999
Laser Power Corporation
00000 Xxxx Xxxxx Xxxx
Xxx Xxxxx, XX 00000
Attn: Xxxx Xxxxxxx
Ladies and Gentlemen:
In order to facilitate the consideration and negotiation of a possible
negotiated transaction involving Union Miniere Inc. (the "Recipient") and Laser
Power Corporation (the "Company"), the Recipient has requested access to certain
non-public information regarding the Company and its subsidiaries. This letter
agreement sets forth the Recipient's obligations regarding the use and
disclosure of such information and regarding various related matters.
The Recipient, intending to be legally bound, acknowledges and agrees
as follows:
1. Limitations on Use and Disclosure of Confidential Information.
Subject to section 4 below, neither the Recipient nor any of the Recipient's
Representatives (as defined in section 13 below) will, at any time, directly or
indirectly:
(a) make use of any Confidential Information (as defined in
section 12 below), except for the specific purpose of considering,
evaluating and negotiating a possible negotiated transaction between
the Recipient and the Company; or
(b) disclose any Confidential Information to any other Person
(as defined in Section 13 below).
The Recipient will be liable and responsible for any breach of this letter
agreement by any of its Representatives and for any other action or conduct on
the part of any of its Representatives that is inconsistent with any provision
of this letter agreement. The Recipient will (at its own expense) take all
actions necessary to restrain its Representatives from making any unauthorized
use or disclosure of any Confidential Information.
2. Company Contact. Any request by the Recipient or any of its
Representatives to review Confidential Information must be directed to the
Company's Chief Executive Officer (the "Company Contact"). Neither the Recipient
nor any of the Recipient's Representatives will contact or otherwise communicate
with any other Representative of the Company without the prior written
authorization of the Company Contact.
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February 25, 1999
Page 2
3. No Representations by Company. The Company Contact will have the
exclusive authority to decide what Confidential Information (if any) is to be
made available to the Recipient and its Representatives. Neither the Company nor
any of the Company's Representatives will be under any obligation to make any
particular Confidential Information available to the Recipient or any of the
Recipient's Representatives or to supplement or update any Confidential
Information previously furnished. Neither the Company nor any of its
Representatives has made or is making any representation or warranty, express or
implied, as to the accuracy or completeness of any Confidential Information, and
neither the Company nor any of its Representatives will have any liability to
the Recipient or to any of the Recipient's Representatives relating to or
resulting from the use of any Confidential Information or any inaccuracies or
errors therein or omissions therefrom. Only those representations and warranties
(if any) that are included in any final definitive written agreement that
provides for the consummation of a negotiated transaction between the Recipient
and the Company and is validly executed on behalf of the Recipient and the
Company (a "Definitive Agreement") will have legal effect.
4. Permitted Disclosures.
(a) Notwithstanding the limitations set forth in section 1
above:
(i) the Recipient may disclose Confidential
Information if and to the extent that the Company consents in writing
to the Recipient's disclosure thereof;
(ii) subject to section 4(b) below, the Recipient may
disclose Confidential Information to any Representative of the
Recipient, but only to the extent such Representative (A) needs to know
such Confidential Information for the purpose of helping the Recipient
evaluate or negotiate a possible negotiated transaction between the
Recipient and the Company, and (B) has been provided with a copy of
this letter agreement and has agreed to abide and be bound by the
provisions hereof; and
(iii) subject to section 4(c) below, the Recipient
may disclose Confidential Information to the extent required by
applicable law or governmental regulation or by valid legal process.
(b) If the Company delivers to the Recipient a written notice
stating that certain Confidential Information may be disclosed only to specified
Representatives of the Recipient then, notwithstanding anything to the contrary
contained in section 4(a)(ii) above, the Recipient shall not disclose or permit
the disclosure of any of such Confidential Information to any other
Representative of the Recipient.
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February 25, 1999
Page 3
(c) If the Recipient or any of the Recipient's Representatives
is required by law or governmental regulation or by subpoena or other valid
legal process to disclose any Confidential Information to any Person, the
Recipient will immediately provide the Company with written notice of the
applicable law, regulation or process so that the Company may seek a protective
order or other appropriate remedy. The Recipient and its Representatives will
cooperate fully with the Company and the Company's Representatives in any
attempt by the Company to obtain any such protective order or other remedy. If
the Company elects not to seek, or is unsuccessful in obtaining, any such
protective order or other remedy in connection with any requirement that the
Recipient disclose Confidential Information, and if the Recipient furnishes the
Company with a written opinion of reputable legal counsel acceptable to the
Company confirming that the disclosure of such Confidential Information is
legally required, then the Recipient may disclose such Confidential Information
to the extent legally required; provided, however, that the Recipient and its
Representatives will use their best efforts to ensure that such Confidential
Information is treated confidentially by each Person to whom it is disclosed.
5. Return of Confidential Information. Upon the Company's request, the
Recipient and the Recipient's Representatives will promptly deliver to the
Company any Confidential Information (and all copies thereof) obtained or
possessed by the Recipient or any of the Recipient's Representatives; provided,
however, that, in lieu of delivering to the Company any written materials of the
type described in clause "(b)" of the first sentence of section 12 below, the
Recipient may destroy such written materials and deliver to the Company a
certificate confirming their destruction. Notwithstanding the delivery to the
Company (or the destruction by the Recipient) of Confidential Information
pursuant to this section 5, the Recipient and its Representatives will continue
to be bound by their confidentiality obligations and other obligations under
this letter agreement.
6. Limitation on Hiring and Soliciting Employees. During the three-year
period commencing on the date of this letter agreement, neither the Recipient
nor any of the Recipient's Representatives will employ, or solicit or seek to
employ, any Person who is an employee of the Company or any subsidiary or other
affiliate of the Company as of the date of this letter agreement or who becomes
an employee of the Company or of any subsidiary or other affiliate of the
Company before the later of March 31, 1999 or the termination of discussions
regarding a possible negotiated transaction involving the Recipient and the
Company.
7. Standstill Provisions. During the three-year period commencing on
the date of this letter agreement (the "Standstill Period"), neither the
Recipient nor any of the Recipient's Representatives will, in any manner,
directly or indirectly:
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February 25, 1999
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(a) make, effect, initiate, cause or participate in (i) any
acquisition of beneficial ownership of any securities of the Company or
any securities of any subsidiary or other affiliate of the Company,
(ii) any acquisition of any assets of the Company or any assets of any
subsidiary or other affiliate of the Company, (iii) any tender offer,
exchange offer, merger, business combination, recapitalization,
restructuring, liquidation, dissolution or extraordinary transaction
involving the Company or any subsidiary or other affiliate of the
Company, or involving any securities or assets of the Company or any
securities or assets of any subsidiary or other affiliate of the
Company, or (iv) any "solicitation" of "proxies" (as those terms are
used in the proxy rules of the Securities and Exchange Commission) or
consents with respect to any securities of the Company;
(b) form, join or participate in a "group" (as defined in the
Securities Exchange Act of 1934 and the rules promulgated thereunder)
with respect to the beneficial ownership of any securities of the
Company;
(c) act, alone or in concert with others, to seek to control
or influence the management, board of directors or policies of the
Company;
(d) take any action that might require the Company to make a
public announcement regarding any of the types of matters set forth in
clause "(a)" of this sentence;
(e) agree or offer to take, or encourage or propose (publicly
or otherwise) the taking of, any action referred to in clause "(a)",
"(b)", "(c)" or "(d)" of this sentence;
(f) assist, induce or encourage any other Person to take any
action of the type referred to in clause "(a)", "(b)", "(c)", "(d)" or
"(e)" of this sentence;
(g) enter into any discussions, negotiations, arrangement or
agreement with any other Person relating to any of the foregoing; or
(h) request or propose that the Company or any of the
Company's Representatives amend, waive or consider the amendment or
waiver of any provision set forth in this section 7;
provided, however, that this section 7 shall not preclude the Recipient from
acquiring securities of the Company such that following any such acquisition the
Recipient owns less than 15% of the outstanding voting stock of the Company;
provided further that this section 7 shall not preclude the Recipient from
engaging in any transaction approved by a majority of the disinterested members
of the Company's Board of Directors; and provided further that the provisions of
this section 7 shall not apply to the Recipient in the event that any other
Person has
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February 25, 1999
Page 5
taken any publicly disclosed action regarding any of the types of matters set
forth in clause "(a)" of this sentence but only for so long as such Person
continues to pursue such matters in a bona fide manner.
The expiration of the Standstill Period will not terminate or otherwise affect
any of the other provisions of this letter agreement.
8. No Obligation to Pursue Transaction. Unless the Recipient and the
Company enter into a Definitive Agreement, no agreement providing for a
transaction involving the Company will be deemed to exist between the Recipient
and the Company, and the Company will be under no obligation to negotiate or
enter into any such agreement or transaction with the Recipient. The Company
reserves the right, in its sole discretion: (a) to conduct any process it deems
appropriate with respect to any transaction or proposed transaction involving
the Company, and to modify any procedures relating to any such process without
giving notice to the Recipient or any other Person; (b) to reject any proposal
made by the Recipient or any of the Recipient's Representatives with respect to
a transaction involving the Company; and (c) to terminate discussions and
negotiations with the Recipient at any time. The Recipient recognizes that,
except as expressly provided in any Definitive Agreement between the Recipient
and the Company: (i) the Company and its Representatives will be free to
negotiate with, and to enter into any agreement or transaction with, any other
interested party; and (ii) the Recipient will not have any rights or claims
against the Company or any of the Company's Representatives arising out of or
relating to any transaction or proposed transaction involving the Company.
9. No Waiver. No failure or delay by the Company or any of its
Representatives in exercising any right, power or privilege under this letter
agreement will operate as a waiver thereof, and no single or partial exercise of
any such right, power or privilege will preclude any other or future exercise
thereof or the exercise of any other right, power or privilege under this letter
agreement. No provision of this letter agreement can be waived or amended except
by means of a written instrument that is validly executed on behalf of the
Company and that refers specifically to the particular provision or provisions
being waived or amended.
10. Remedies. The Recipient shall indemnify and hold harmless the
Company and the Company's Representatives against and from, and shall compensate
and reimburse the Company and the Company's Representatives for, any damage,
loss, claim, liability or expense (including legal fees and the cost of
enforcing the Company's rights under this letter agreement) arising directly or
indirectly out of or resulting directly or indirectly from any unauthorized use
or disclosure of any Confidential Information or any other breach of this letter
agreement. The Recipient acknowledges that money damages would not be a
sufficient remedy for any breach of this letter agreement by the Recipient or
any of the Recipient's Representatives and that the Company would suffer
irreparable harm as a result of any such breach. Accordingly, the
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February 25, 1999
Page 6
Company will also be entitled to equitable relief, including injunction and
specific performance, as a remedy for any breach or threatened breach of this
letter agreement. The indemnification and equitable remedies referred to above
will not be deemed to be the exclusive remedies for a breach of this letter
agreement, but rather will be in addition to all other remedies available at law
or in equity to the Company. In the event of litigation relating to this letter
agreement, if a court of competent jurisdiction determines that the Recipient or
any of its Representatives has breached this letter agreement, the Recipient
will be liable for, and will pay to the Company and the Company's
Representatives, the reasonable legal fees incurred by the Company and the
Company's Representatives in connection with such litigation (including any
appeal relating thereto).
11. Successors and Assigns; Applicable Law; Jurisdiction and Venue.
This letter agreement will be binding upon the Recipient and its Representatives
and their respective heirs, successors and assigns, and will inure to the
benefit of the Company and its Representatives and their respective heirs,
successors and assigns. This letter agreement will be governed by and construed
in accordance with the laws of the State of California (without giving effect to
principles of conflicts of laws). The Recipient and its Representatives: (a)
irrevocably and unconditionally consent and submit to the jurisdiction of the
state and federal courts located in the State of California for purposes of any
action, suit or proceeding arising out of or relating to this letter agreement;
(b) agree that service of any process, summons, notice or document by U.S.
registered mail to the address set forth at the end of this letter agreement
shall be effective service of process for any action, suit or proceeding brought
against the Recipient or any of the Recipient's Representatives; (c) irrevocably
and unconditionally waive any objection to the laying of venue of any action,
suit or proceeding arising out of or relating to this letter agreement in any
state or federal court located in the State of California; and (d) irrevocably
and unconditionally waive the right to plead or claim, and irrevocably and
unconditionally agree not to plead or claim, that any action, suit or proceeding
arising out of or relating to this letter agreement that is brought in any state
or federal court located in the State of California has been brought in an
inconvenient forum.
12. Confidential Information. For purposes of this letter agreement,
"Confidential Information" will be deemed to include:
(a) any information (including any technology, know-how,
patent application, test result, research study, business plan, budget,
forecast or projection) relating directly or indirectly to the business
of the Company, any predecessor entity or any subsidiary or other
affiliate of the Company (whether prepared by the Company or by any
other Person and whether or not in written form) that is or has been
made available to the Recipient or any Representative of the Recipient
by or on behalf of the Company or any Representative of the Company;
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February 25, 1999
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(b) any memorandum, analysis, compilation, summary,
interpretation, study, report or other document, record or material
that is or has been prepared by or for the Recipient or any
Representative of the Recipient and that contains, reflects, interprets
or is based directly or indirectly upon any information of the type
referred to in clause "(a)" of this sentence;
(c) the existence and terms of this letter agreement, and the
fact that information of the type referred to in clause "(a)" of this
sentence has been made available to the Recipient or any of its
Representatives; and
(d) the fact that discussions or negotiations are or may be
taking place with respect to a possible transaction involving the
Recipient and the Company, and the proposed terms of any such
transaction.
However, "Confidential Information" will not be deemed to include:
(i) any information that is or becomes generally
available to the public or the Company's stockholders other than as a
direct or indirect result of the disclosure of any of such information
by the Recipient or by any of the Recipient's Representatives;
(ii) any information that was in the Recipient's
possession prior to the time it was first made available to the
Recipient or any of the Recipient's Representatives by or on behalf of
the Company or any of the Company's Representatives, provided that the
source of such information was not and is not bound by any contractual
or other obligation of confidentiality to the Company or any other
Person with respect to any of such information; or
(iii) any information that becomes available to the
Recipient on a non-confidential basis from a source other than the
Company or any of the Company's Representatives, provided that such
source is not bound by any contractual or other obligation of
confidentiality to the Company or any other Person with respect to any
of such information.
13. Miscellaneous.
(a) For purposes of this letter agreement, a party's
"Representatives" will be deemed to include each Person that is or becomes (i) a
subsidiary or other affiliate of such party, or (ii) an officer, director,
employee, partner, attorney, advisor, accountant, agent or representative of
such party or of any of such party's subsidiaries or other affiliates; provided,
however, that notwithstanding the other provisions of this letter agreement,
this letter agreement
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February 25, 1999
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shall not inhibit in any way Xx. Xxxxxxx X. Xxxxx in the discharge of his duties
and responsibilities as a director of the Company.
(b) The term "Person," as used in this letter agreement, will
be broadly interpreted to include any individual and any corporation,
partnership, entity, group, tribunal or governmental authority.
(c) The bold-faced captions appearing in this letter agreement
have been included only for convenience and shall not affect or be taken into
account in the interpretation of this letter agreement.
(d) The invalidity or unenforceability of any provision of
this letter agreement shall not affect the validity or enforceability of any
other provision of this letter agreement.
(e) By making Confidential Information or other information
available to the Recipient or the Recipient's Representatives, the Company is
not, and shall not be deemed to be, granting (expressly or by implication) any
license or other right under or with respect to any patent, trade secret,
copyright, trademark or other proprietary or intellectual property right.
(f) This letter agreement constitutes the entire agreement
between the Recipient and the Company regarding the subject matter hereof and
supersedes any prior agreement between the Recipient and the Company regarding
the subject matter hereof.
Very truly yours,
UNION MINIERE INC.
By: /s/ Xxxxxxx X. Xxxxx
--------------------------------
Name: Xxxxxxx X. Xxxxx
Title: Executive Vice President
Address: 00000 Xxxx Xxxxxxxx Xxxxx
Xxxxxxxx, XX 00000
