[WAVERLY, INC. LETTERHEAD]
PERSONAL AND CONFIDENTIAL December 5, 1997
Wolters Kluwer U.S. Corporation
CONFIDENTIALITY AGREEMENT
Dear Sirs:
In connection with your consideration of a possible transaction (the
"Transaction") with Waverly, Inc. ("Waverly"), you have requested certain
information concerning Xxxxxxx. Waverly is prepared, in its sole discretion,
to make available to you certain information which is non-public,
confidential or proprietary in nature concerning the business, financial
condition, operation and assets of Waverly for your use in connection with
your consideration of the Transaction.
As a condition to and in consideration of your being furnished such
information, you agree to treat any information concerning Waverly or its
business or operations (whether written, electronically recorded or oral, and
whether prepared by Waverly, its advisors or otherwise) which is furnished to
you by or on behalf of Waverly, including any materials prepared by you or
your representatives which reflect such information (herein collectively
referred to as the "Evaluation Material"), in accordance with the provisions
of this letter and to take or abstain from taking certain other actions
described in this letter. The term "Evaluation Material" does not include
information which (i) is already in your possession, provided that such
information is not subject to another confidentiality agreement with or other
obligation of secrecy to Waverly; (ii) becomes available to you on a
non-confidential basis from a source other than Waverly or its advisors,
provided that such source is not bound by a confidentiality agreement with or
other obligation of secrecy to Waverly; (iii) which hereafter becomes
generally available except through your fault.
You hereby agree that the Evaluation Material will be used solely for the
purpose of evaluating the Transaction, and that such information will be kept
confidential by you and may be disclosed only to those of
Wolters Kluwer U.S. Corporation
December 5, 1997
Page 2
your directors, officers and employees, and representatives of your advisors
who need to know such information for the purpose of evaluating any such
possible transaction between Waverly and you (it being agreed that such
directors, officers, employees and representatives of your advisors shall be
informed by you of the confidential nature of such information, shall be
directed by you to treat such information confidentially, and shall agree to
be bound by the terms of this agreement prior to receipt of any Evaluation
Material), unless Waverly otherwise consents in writing. You hereby agree to
be responsible for any violations of this letter by any of the other persons
referred to in this paragraph other than Waverly.
In the event that you or any of your advisors are requested or required to
disclose any Evaluation Material by legal process or in connection with any
legal proceedings, you agree that you will provide prompt written notice of
such request or requirement to Waverly, so that Waverly may take whatever
steps it deems appropriate concerning disclosure of such information,
including requesting entry of appropriate protective orders, and/or waive
compliance with the provisions of this agreement. In the event that no such
protective order or other remedy is obtained, or that Waverly waives
compliance with the terms of this agreement, you and your advisors will
furnish only that portion of the information which, upon written advice of
counsel, is required to be provided and will exercise your best efforts at
Xxxxxxx's expense to obtain reliable assurance that the Evaluation Material
will be afforded confidential treatment.
You agree that nothing in this agreement will prevent Waverly from (i)
determining that certain Evaluation Material should be disclosed, if at all,
under terms and conditions which limit its disclosure further than the
limitations set forth above; and (ii) upon making any such determination,
conditioning access to any such Evaluation Material upon the execution of a
further agreement, satisfactory to Waverly, providing for such additional
terms and conditions. In addition, you will, and will to cause your
representatives to, honor the confidentiality provisions contained in any
agreements of Waverly which are made available to you and your
representatives.
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December 5, 1997
Page 3
You hereby acknowledge that you are aware, and that you will advise such
directors, officers, employees and representatives of your advisors who are
informed as to the matters which are the subject of this letter, that the
United States securities laws prohibit any person who has received from an
issuer material, non-public information from purchasing or selling securities
of such issuer or from communicating such information to any other person
under circumstances in which it is reasonably foreseeable that such person is
likely to purchase or sell such securities.
In addition, without the prior written consent of Waverly, you will not, and
will direct your directors, officers, employees and representatives of your
advisors not to, disclose to any person either the fact that discussions or
negotiations are taking place concerning a possible transaction between
Waverly and you or any of the terms, conditions or other facts with respect
to any such possible transaction, including the status thereof. Without
limiting the generality of the foregoing, you further agree that, without the
prior written consent of Waverly, you will not, directly or indirectly, enter
into any agreement, arrangement or understanding or any discussions which
might lead to such agreement, arrangement or understanding with any other
person regarding the Transaction. However, nothing in this agreement shall
prohibit you from disclosing or discussing negotiations concerning the
Transaction or any terms of a possible transaction between Waverly and you,
with and only with Xxxx Elsevier Inc.
In consideration of the Evaluation Material being furnished to you, you
hereby agree that, without the prior written consent of the Board of
Directors of Waverly, for a period of three (3) years from the date hereof,
neither you nor any of your affiliates, in any manner whatsoever, directly or
indirectly, will, acting alone or as part of a group, (a) acquire or offer or
agree to acquire, directly or indirectly, by purchase or otherwise, any
securities (or direct or indirect rights or options to acquire any
securities) of Waverly or any successor or affiliate of Waverly (subject to
an exception for de minimis passive investments to be mutually agreed upon by
the parties after the execution of this letter agreement), or seek by any
action not permitted under this letter agreement to influence or control the
management or policies of Waverly, or (b) publicly propose to (i) acquire
Wolters Kluwer U.S. Corporation
December 5, 1997
Page 4
or offer or agree to acquire any securities (or direct or indirect rights or
options to acquire any securities) or assets of Waverly or (ii) otherwise act
or seek to influence or control the management, the board of directors or
policies of Waverly.
In addition, you agree that, for a period of three (3) years from the date
hereof, you will not, directly or indirectly, publicly present, or publicly
propose to present, to the stockholders of Waverly any proposal or offer for
a merger, tender or exchange offer or other form of business combination
involving Waverly, or effect, publicly propose to effect, or cause to occur
any of the foregoing, that previously has not been approved in writing by the
Board of Directors of Waverly, nor will you, directly or indirectly, solicit,
or propose (whether publicly or otherwise) to solicit, proxies or consents to
vote or become a participant in any "election contest" with respect to
Waverly (as such terms are used in Rule 14a-1 and Rule 14a-11 of Regulation
14A under the Securities Exchange Act of 1934, as amended).
Although Waverly has endeavored to include in the Evaluation Material
information known to it which it believes to be relevant for the purpose of
your investigation, you understand that neither Waverly nor any of its
directors, officers, employees, agents, representatives or advisors have made
or make any representation or warranty as to the accuracy or completeness of
the Evaluation Material. You agree that neither Waverly nor its directors,
officers, employees, agents, representatives or advisors shall have any
liability to you or any of your advisors resulting from the availability or
use of Evaluation Material.
If you determine that you do not wish to proceed with the Transaction, you
agree to promptly advise Waverly of such decision. In the event that you do
not proceed with the transaction which is the subject of this letter within a
reasonable time, you shall promptly return to Waverly at its request all
written Evaluation Material and any other written material containing or
reflecting any information in the Evaluation Material (whether prepared by
Waverly, its advisors or otherwise) and will not retain any copies, extracts,
or other reproductions in whole or in part of such written material, except
that all documents, memoranda, notes and other writings whatsoever prepared
by you or your
Wolters Kluwer U.S. Corporation
December 5, 1997
Page 5
advisors based on the information in the Evaluation Material or which contain
information set forth in the Evaluation Material shall be destroyed, and such
destruction shall be certified in writing to Waverly by an authorized officer
supervising such destruction.
You agree that, for a period of two (2) years from the date of this
letter, you will not, directly or indirectly, solicit for employment any
employee of Waverly with whom you have had contact or who became known to you
in connection with your consideration of the Transaction. You agree not to
contact any person employed by Xxxxxxx regarding the subject matter of this
letter without the prior approval of Xxxxxxx.
You acknowledge that Waverly may establish procedures and guidelines (the
"Procedures") for the submission of proposals with respect to the
Transaction. You acknowledge and agree that (a) Waverly and its
representatives are free to conduct the process leading up to a possible
Transaction as Waverly and its representatives, in their sole discretion,
determine (including, without limitation, by negotiating with any third party
and entering into a preliminary or definitive agreement without prior notice
to you or any other person); and (b) Waverly reserves the right, in its sole
discretion, to change the Procedures relating to the consideration of the
Transaction at any time without prior notice to you or any other person, to
reject any and all proposals made by you or any of your representatives with
regard to the Transaction, and to terminate discussions and negotiations with
you at any time and for any reason.
You agree not to initiate or maintain contact (except for contacts made in
connection with existing commercial relationships and/or in the ordinary
course of business) with any officer, director, employee or agent of Waverly
except with the express prior permission of Waverly. It is understood that
Xxxxxxx will arrange for appropriate contacts for due diligence purposes. It
is further understood that all (a) communications regarding a possible
transaction, (b) requests for additional information, (c) requests for
facility tours or management meetings and (d) discussions or questions
regarding Procedures, will be submitted only to certain designated Waverly
employees.
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December 5, 1997
Page 6
You agree that unless and until a definitive agreement between Waverly and
you with respect to the Transaction referred to in the first paragraph of
this letter has been executed and delivered, neither Waverly nor you will be
under any legal obligation of any kind whatsoever with respect to the
Transaction by virtue of this or any other written, electronic or oral
communication with respect to the Transaction by any of Waverly's directors,
officers, employees, agents or any other representatives or their advisors
and representatives of those advisors, except for the matters specifically
agreed to in this letter. The agreements set forth in this letter may be
modified or waived only by a separate writing signed by Waverly and you
expressly modifying or waiving this agreement.
You also agree that in the event of any breach of the provisions of this
agreement, Xxxxxxx would be entitled to equitable relief, including an
injunction, because such a breach would cause irreparable harm for which
there would be no adequate remedy at law. You agree that you shall not
oppose the granting of such equitable relief.
In the event that you or your directors, officers, employees or
representatives shall have knowledge of any breach of the confidentiality of,
or the misappropriation of, any of the Evaluation Material, you shall
promptly give notice thereof to Waverly.
It is further understood and agreed that no failure or delay by Xxxxxxx in
exercising any right, power or privilege hereunder shall operate as a waiver
thereof, nor shall any single or partial exercise thereof preclude any other
or further exercise thereof or the exercise of any right, power or privilege
hereunder.
You understand and agree that if any provision contained in this letter
agreement or the application thereof to either you or Waverly, or any other
person or circumstance shall be invalid, illegal or unenforceable in any
respect under any applicable law as determined by a court of competent
jurisdiction, the validity, legality and enforceability of the remaining
provisions contained in this letter agreement, or the application of such
provision to such persons or circumstances other than those as to which it
has been held invalid or unenforceable, shall remain in full force and effect
and shall in no way be affected,
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December 5, 1997
Page 7
impaired or invalidated thereby. In the case of any such invalidity,
illegality or unenforceability, you agree to negotiate with Xxxxxxx in good
faith in an effort to agree upon a suitable and equitable substitute
provision to effect the original intent of the parties to this letter
agreement.
You agree that the rights and remedies of Waverly under or pursuant to this
letter agreement shall inure to the benefit of Waverly, its affiliates, and
their respective successors and assigns. This letter agreement shall not be
assigned by you without the prior written consent of Xxxxxxx. This letter
agreement shall be binding upon your successors and permitted assigns.
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December 5, 1997
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This letter agreement shall be governed by, and construed in accordance with,
the laws of the State of Maryland.
Very truly yours,
WAVERLY, INC.
By: /s/ Xxxxxx X. Xxxxxx , Xx.
--------------------------------------
Name: Xxxxxx X. Xxxxxx, Xx.
Title: President and CEO
Accepted and Agreed as
of the date first written
above:
WOLTERS KLUWER U.S. CORPORATION
By: /s/ Xxxxx X. Xxxx
----------------------------------
Name: Xxxxx X. Xxxx
Title: Executive Vice President
