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EXHIBIT 4
CONFIDENTIALITY AGREEMENT
April 29, 1997
Monterey Resources, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇. ▇▇▇▇▇▇ Whaling
Chairman and Chief Executive Officer
Gentlemen:
In connection with your analysis of a possible negotiated
transaction with ▇▇▇▇▇▇▇▇▇ Energy, Inc. (the "Company"), you have been or will
be furnished certain information that is proprietary, non-public or
confidential concerning the Company from Representatives (as defined below) of
the Company, including the Company's financial advisors, ▇▇▇▇▇▇▇▇▇▇▇ & Co.,
Inc. (collectively, and together with the Company, the "Disclosing Parties").
In consideration of furnishing you with such information to assist you in such
regard, you hereby agree to the following (it being understood that you are
also agreeing to cause your affiliates to comply with the applicable provisions
hereof):
1. Use of Evaluation Material. The Evaluation Material
(as defined below) will be used solely for the purpose of evaluating a possible
negotiated acquisition or other business combination transaction between you
and the Company approved by the Board of the Directors of the Company and not
in a manner detrimental to the Company. Unless and until you have completed an
acquisition or other business combination with the Company, all the Evaluation
Material will be kept confidential by you and will not be disclosed to any
other persons in any manner; provided that you may disclose the Evaluation
Material or portions thereof to those of your Representatives who need to know
such information for the purpose of evaluating a possible negotiated
transaction involving you and the Company (it being understood that such
Representatives shall be informed by you of the confidential nature of such
information and shall agree to treat such information confidentially in
accordance with this letter). You agree to be responsible for compliance with
this agreement by any of your Representatives.
2. Legally Required Disclosures. In the event that you
or any of your Representatives is requested or required (by deposition,
interrogatory, request for documents, subpoena, civil investigative demand or
similar process) to disclose any of the Evaluation Material, you shall provide
the Company with prompt prior written notice of such request
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or requirement, and you shall cooperate with the Company so that the Company
may seek a protective order or other appropriate remedy or, if it so elects,
waive compliance with the terms of this agreement. In the event that such
protective order or other remedy is not obtained, or the Company waives
compliance with the provisions hereof, you or such Representative, as the case
may be, may disclose only that portion of the Evaluation Material that you are
advised by counsel is legally required to be disclosed and shall exercise all
reasonable efforts to obtain assurance that confidential treatment will be
accorded such Evaluation Material.
3. Definition of Evaluation Material. The term
"Evaluation Material" as used in this agreement shall mean all information and
documents which any Disclosing Party furnishes or otherwise discloses to you or
any of your Representatives, together with all analyses, compilations, studies
or other documents, records or data (in whatever form maintained, whether
documentary, computer storage or otherwise) prepared by you or any of your
Representatives which contain or otherwise reflect or are generated from such
information and documents. The term "Evaluation Material" does not include any
information that (i) at the time of disclosure or thereafter is generally
available to and known by the public (other than as a result of a disclosure by
you or any of your Representatives), or (ii) is or was available to you on a
nonconfidential basis from a source other than the Disclosing Parties who to
your knowledge after reasonable inquiry is not prohibited from transmitting the
information to you by a contractual, legal or fiduciary obligation to the
Company.
4. Return or Destruction of Materials. Upon request of
the Company you will return promptly to the Company all copies of the
Evaluation Material then in your possession or in the possession of any of the
Representatives, and any copies, notes or extracts thereof, without retaining
any copy thereof, except that you may destroy promptly (in lieu of returning)
all copies of any analyses, compilations, studies or other documents, records
or data prepared by you or your Representatives which contain or otherwise
reflect or are generated from the Evaluation Material, and you will certify to
the Company that such destruction has been accomplished.
5. Nondisclosure of Possible Transaction. Without the
prior written consent of the Company, and except as required by law or stock
exchange rule, you will not, and will direct and cause your Representatives not
to, disclose to any person (i) that Evaluation Material has been made available
to you, (ii) that discussions or negotiations are taking place concerning a
possible transaction between the Company and you or any of your affiliates,
(iii) that you or any of your affiliates are considering or reviewing a
transaction involving or relating to the Company or taking any of the actions
described in paragraph 8 or (iv) the terms, conditions or other facts with
respect to any such possible transaction or actions, including the status
thereof. Your obligations in the preceding sentence shall survive any return
or destruction of the Evaluation Material pursuant to paragraph 4.
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6. Contacts With Company Personnel. Until the earliest
of (i) the execution by you of a Definitive Business Combination Agreement (as
defined below), (ii) an acquisition of the Company by a third party or (iii)
eighteen (18) months from the date of this agreement, you agree not to initiate
or maintain contact (except for those contacts made in the ordinary course of
business) with any officer, director or key employee of the Company or any of
its subsidiaries regarding its business, assets, operations, prospects or
finances, except with the express permission of a duly authorized executive
officer of the Company. It is understood that ▇▇▇▇▇▇▇▇▇▇▇ & Co., Inc., or such
other parties as may be designated in writing by the Company, 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 or
directed to ▇▇▇▇▇▇▇▇▇▇▇ & Co., Inc., or such other party as may be designated
in writing by the Company. Except as provided in a Definitive Business
Combination Agreement, you agree that for a period of eighteen (18) months from
the date hereof, you will not solicit for employment any officer, director or
key employee of the Company or its subsidiaries; provided, that this
prohibition shall not apply to solicitations made by you to the public or the
industry generally, and that you shall not be prohibited from employing any
such person who contacts you on his or her own initiative without any
prohibited solicitation.
7. No Representation or Warranty. Although the Company
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 the Company nor any of its Representatives have made or
make any representation or warranty as to the accuracy or completeness of the
Evaluation Material. You agree that neither the Company nor its
Representatives shall have any liability to you or any of your Representatives
resulting from the use of the Evaluation Material. Only those representations
or warranties that are made in a Definitive Business Combination Agreement
when, as and if it is executed, and subject to such limitations and
restrictions as may be specified in such Definitive Business Combination
Agreement, will have any legal effect.
8. Other Restrictions. Until the expiration of eighteen
(18) months from the date hereof, neither you nor any of your affiliates nor
any of your Representatives shall, without the prior written consent of the
Board of Directors of the Company, directly or indirectly, (a) effect or seek,
offer or propose (whether publicly or otherwise) to effect, or cause or
participate in or in any way assist any other person to effect or seek, offer
or propose (whether publicly or otherwise) to effect or participate in, (i) any
acquisition of any securities or rights to acquire any securities (or any other
beneficial ownership thereof) or assets of the Company or any of its
subsidiaries (provided that the foregoing shall not apply to any acquisition by
any of your employee benefit plans in the ordinary course of business); (ii)
any merger or other business combination or tender or exchange offer involving
the Company or any of its subsidiaries; (iii) any recapitalization,
restructuring,
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liquidation, dissolution or other extraordinary transaction with respect to the
Company or any of its subsidiaries; or (iv) any "solicitation" of "proxies" (as
such terms are used in the proxy rules of the Securities and Exchange
Commission) or consents to vote or otherwise with respect to any voting
securities of the Company, or make any communication exempted from the
definition of "solicitation" by Rule 14a-1(1)(2)(iv) under the Securities
Exchange Act of 1934; (b) form, join or in any way participate in a "group" (as
defined under the Securities Exchange Act of 1934) with respect to the Company;
(c) otherwise 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 which the Company has been advised by counsel would require it
to make a public announcement regarding any of the types of matters set forth
in (a) above; or (e) enter into any discussions or arrangements with any third
party with respect to any of the foregoing. You agree during such period not
to publicly request the Company (or its Representatives), directly or
indirectly, to amend or waive any provision of this paragraph (including this
sentence).
9. Definitive Business Combination Agreement. You also
understand and agree that no contract or agreement providing for a business
combination transaction between the Company and you or your affiliates shall be
deemed to exist unless and until a definitive business combination agreement
has been executed and delivered by you and each of the other parties thereto
("Definitive Business Combination Agreement"), and you hereby waive, in
advance, any claims (including, without limitation, breach of contract) in
connection with such a transaction unless and until a Definitive Business
Combination Agreement has been executed and delivered by you and each of the
other parties thereto. It is also agreed that unless and until a Definitive
Business Combination Agreement between the Company and you with respect to a
business combination involving the Company has been executed and delivered,
neither the Company nor its stockholders has any legal obligation of any kind
whatsoever with respect to any such transaction. For purposes of this
paragraph, the term "Definitive Business Combination Agreement" does not
include an executed letter of intent or any other preliminary written
agreement, nor does it include any written or oral offer or bid on your part or
any written or oral acceptance thereof. You further understand that the
Company shall be free to conduct any process for the sale of the Company as it
in its sole discretion shall determine. Neither this paragraph nor any other
provision in this agreement can be waived or amended except by written consent
of the Company, which consent shall specifically refer to this paragraph (or
such other provision) and explicitly make such waiver or amendment.
10. Securities Laws. You hereby acknowledge that you are
aware, and that you will advise your Representatives who are informed as to the
matters that are the subject of this agreement, that the United States
securities laws prohibit any person who has material, non-public information
concerning the matters which are the subject of this agreement from purchasing
or selling securities of the Company or from communicating such information to
any other person
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under circumstances in which it is reasonably foreseeable that such person is
likely to purchase or sell such securities.
11. Remedies. You agree that money damages would not be
a sufficient remedy for any breach of this agreement and that the Company shall
be entitled to equitable relief, including injunction and specific performance,
in the event of any breach of the provisions of this agreement, in addition to
all other remedies available to the Company at law or in equity. You also
agree to reimburse the Company for all costs and expense, including reasonable
attorneys' fees, incurred by it in enforcing your obligations hereunder.
12. Access. In the event you desire physical access to
any of the Company's properties, you agree to indemnify, defend and hold
harmless the Company, its affiliates and subsidiaries from and against any and
all liabilities, claims and causes of action for personal injury, death or
property damage occurring on or to such property as a result of your entry onto
the premises. You agree to comply fully with all rules, regulations and
instructions issued by the Company regarding your actions while upon, entering
or leaving the property of the Company.
13. No Waiver. It is further understood and agreed that
no failure or delay in exercising any right, power or privilege hereunder will
operate as a waiver thereof, nor will any single or partial exercise thereof
preclude any other or further exercise thereof or the exercise of any other
right, power or privilege hereunder. This agreement represents the entire
understanding of the parties with respect to the matters referred to herein and
supersedes all prior understandings, written or oral, between the parties with
respect thereto.
14. Person; Representatives. As used in this agreement,
(i) the term "person" will be interpreted broadly to include, without
limitation, any corporation, company, group, partnership, limited liability
company, other entity or individual, and (ii) the term "Representatives," used
with respect to a person, shall include the directors, officers, employees,
representatives, agents, attorneys, consultants, accountants, financial and
other advisors, and banks and other financing sources of or to such person.
15. Notices. All notices to be given to a party hereunder
shall be in writing and delivered personally, by overnight courier or by
facsimile, addressed to the Chief Executive Officer of such party, with a copy
to the General Counsel of such party, at the corporate headquarters of such
party.
This agreement is for the benefit of the Company and you and
will be governed by and construed in accordance with the laws of the State of
Delaware, without giving effect to the choice of law rules thereof.
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If you agree with the foregoing, please sign both copies of
this agreement and return one to the Company, which will constitute our
agreement with respect to the subject matter of this letter.
Very truly yours,
▇▇▇▇▇▇▇▇▇ ENERGY, INC.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
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▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
CONFIRMED AND AGREED
as of the date written above
MONTEREY RESOURCES, INC.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
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Title: President
