[LETTERHEAD OF GCHI]
August 23, 1999
Cementos Portland, SA
Estella 6
31002 Pamplona, Spain
Attention: Xx. Xxxxxx xx Xxxxxx Xxxxxx
Deputy Managing Director
Gentlemen:
In order to allow you to evaluate the possible acquisition (the "Proposed
Acquisition") of Giant Cement Holding, Inc. (the "Company"), we will deliver to
you, upon your execution and delivery to us of this letter agreement, certain
information about the properties and operations of the Company. All information
about the Company furnished by us or our Representatives (as defined below),
whether furnished before or after the date hereof, whether oral or written, and
regardless of the manner in which it is furnished, is referred to in this letter
agreement as "Proprietary Information". Proprietary Information does not
include, however, information which (a) is or becomes generally available to the
public other than as a result of a disclosure by you or your Representatives,
(b) was available to you on a nonconfidential basis prior to its disclosure by
us or our Representatives or (c) becomes available to you on a nonconfidential
basis from a person other than us or our Representatives who is not otherwise
bound by a confidentiality agreement with us or any Representative of ours, or
is otherwise not under an obligation to us or any Representative of ours not to
transmit the information to you. As used in this letter agreement, the term
"Representative" means, as to any person, such person's affiliates and its and
their directors, officers, employees, agents, advisors (including, without
limitation, financial advisors, counsel and accountants) and controlling
persons. As used in this letter agreement, the term "person" shall be broadly
interpreted to include, without limitation, any corporation, company,
partnership, other entity or individual.
Except as required by law, unless otherwise agreed to in writing by us,
you agree (a) to keep all Proprietary Information confidential and not to
disclose or reveal any Proprietary Information to any person other than your
Representatives who are actively and directly participating in your evaluation
of the Proposed Acquisition or who otherwise need to know the Proprietary
Information for the purpose of evaluating the Proposed Acquisition and to cause
those persons to observe the terms of this letter agreement, (b) not to use
Proprietary Information for any purpose other than in connection with your
evaluation of the Proposed Acquisition or the consummation of the Proposed
Acquisition in a manner that we have approved and (c) not to disclose to any
person (other than those of your Representatives who are actively and directly
participating in your evaluation of the Proposed Acquisition or who otherwise
need to know for the purpose of evaluating the Proposed Acquisition and, in the
case of your Representatives, whom you will cause to observe the terms of this
letter agreement) any information about the Proposed Acquisition, or the terms
or conditions or any other facts relating thereto, including, without
limitation, the fact that discussions are taking place with respect thereto or
the status thereof, or the
fact that Proprietary Information has been made available to you or your
Representatives. You will be responsible for any breach of the terms of this
letter agreement by you or your Representatives.
In the event that you are requested pursuant to, or required by,
applicable law or regulation or by legal process to disclose any Proprietary
Information or any other information concerning the Company or the Proposed
Acquisition, you agree that you will provide us with prompt notice of such
request or requirement in order to enable us to seek an appropriate protective
order or other remedy, to consult with you with respect to our taking steps to
resist or narrow the scope of such request or legal process, or to waive
compliance, in whole or in part, with the terms of this letter agreement. In any
such event you will use your reasonable best efforts to ensure that all
Proprietary Information and other information that is so disclosed will be
accorded confidential treatment.
You also agree that for a period of one year from the date of this letter
agreement, neither you nor any of your Representatives will, without the prior
written consent of the Company or its Board of Directors:
(a) acquire, offer to acquire, or agree to acquire, directly or
indirectly, by purchase or otherwise, any voting securities or direct
or indirect rights to acquire any voting securities of the Company or
any subsidiary thereof, or of any successor to or person in control of
the Company, or any assets of the Company or any subsidiary or
division thereof or of any such successor or controlling person;
(b) make, or in any way participate, directly or indirectly, in any
"solicitation" of "proxies" to vote (as such terms are used in the
rules of the Securities and Exchange Commission), or seek to advise or
influence any person or entity with respect to the voting of any
voting securities of the Company;
(c) make any public announcement with respect to, or submit a proposal
for, or offer of (with or without conditions) any extraordinary
transaction involving the Company or any of its securities or assets;
(d) form, join or in any way participate in a "group" as defined in
Section 13(d)(3) of the Securities Exchange Act of 1934, as amended,
in connection with any of the foregoing;
(e) Seek or propose to influence or control the Management or policies of
the Company; or
(f) request the Company or any of our Representatives, directly or
indirectly, to amend or waive any provision of this paragraph.
You will promptly advise the Company of any inquiry or proposal made to you with
respect to any of the foregoing.
If you determine that you do not wish to proceed with the Proposed
Acquisition, you will promptly advise us of that decision. In that case, or in
the event that we, in our sole discretion, so request or the Proposed
Acquisition is not consummated by you, you will, (i) continue to refrain from
disclosing to any person any information regarding the Proposed Acquisition,
including without limitation the terms and conditions or other facts relating
thereto, the fact that you engaged in discussions relating thereto or the status
thereof, and (ii) upon our request, promptly deliver to us all Proprietary
Information, including all copies, reproductions, summaries, analyses or
extracts thereof or based thereon in your possession or in the possession of any
Representative of yours.
You acknowledge that none of the Company, Xxxxxxx Lynch, Xxxxxx, Xxxxxx &
Xxxxx Incorporated ("Xxxxxxx Xxxxx") or our other Representatives and none of
the respective officers, directors, employees, agents or controlling persons of
Xxxxxxx Xxxxx or such other Representatives makes any express or implied
representation or warranty as to the accuracy or completeness of any Proprietary
Information, and you agree that none of such persons shall have any liability to
you or any of your Representatives relating to or arising from your or their use
of any Proprietary Information or for any errors therein or omissions therefrom.
You also agree that you are not entitled to rely on the accuracy or completeness
of any Proprietary Information and that you shall be entitled to rely solely on
such representations and warranties regarding Proprietary Information as may be
made to you in any final acquisition agreement relating to the Proposed
Acquisition, subject to the terms and conditions of such agreement.
You agree that, without our prior written consent, you will not for a
period of one year from the date hereof directly or indirectly solicit for
employment or employ any person who is now employed by us or any of our
subsidiaries and who is identified by you as a result of your evaluation or
otherwise in connection with the Proposed Acquisition.
You agree that until a final acquisition agreement regarding the Proposed
Acquisition has been executed by you and us, neither we nor any of our
Representatives are under any legal obligation and shall have no liability to
you of any nature whatsoever with respect to the Proposed Acquisition by virtue
of this letter agreement or otherwise. You also acknowledge and agree that (i)
we and our Representatives may conduct the process that may or may not result in
the Proposed Acquisition in such manner as we, in our sole discretion, may
determine (including, without limitation, negotiating and entering into a final
acquisition agreement with any third party without notice to you); (ii) we
reserve the right to change (in our sole discretion, at any time and without
notice to you) the procedures relating to our and your consideration of the
Proposed Acquisition (including, without limitation, terminating all further
discussions with you and requesting that you return all Proprietary Information
to us); (iii) all inquiries, requests for information and other communications
with the Company will be made only through Xxxxxxx Xxxxx & Co. or such other
individuals as may be designated by them; and (iv) you will not contact
employees, customers or suppliers of the Company with respect to the Proposed
Acquisition or for the purpose of obtaining information for use in your
evaluation of the Proposed Acquisition.
Without prejudice to the rights and remedies otherwise available to us,
you agree we shall be entitled to equitable relief by way of injunction or
otherwise if you or any of your Representatives breach or threaten to breach any
of the provisions of this letter agreement.
It is further understood and agreed that no failure or delay by us 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.
This letter agreement shall be governed by and construed in accordance
with the laws of the State of New York applicable to contracts executed in and
to be performed in that state.
Any assignment of this letter agreement by you without our prior written
consent shall be void.
This letter agreement contains the entire agreement between you and us
concerning confidentiality of the Proprietary Information, and no modification
of this letter agreement or waiver of the terms and conditions hereof shall be
binding upon you or us, unless approved in writing by each of you and us.
Please confirm your agreement with the foregoing by signing and returning
to the undersigned the duplicate copy of this letter enclosed herewith.
GIANT CEMENT HOLDING, INC.
By /s/ Xxxxx X. Xxxxxx
---------------------------
Title: Vice President and
Chief Financial Officer
Accepted and Agreed as of the date first written above:
CEMENTOS PORTLAND, SA
By Xxxxxx xx Xxxxxx Xxxxxx
------------------------------------
Title: Director General Corporation
Cementos Portland
21-9-99
