EXHIBIT 1
WORKGROUP TECHNOLOGY CORPORATION
Xxx Xxxxxxxxxx Xxxxx Xxxxx
Xxxxxxxxxx, XX 00000-0000
RECIPIENT: October 16, 2002
12:08 PM
SofTech, Inc.
0 Xxxxxxxx Xxxxx
Xxxxxxxxx, XX 00000
CONFIDENTIALITY AGREEMENT
Gentlemen:
In connection with your consideration of a possible negotiated transaction
with Workgroup Technology Corporation (the "Company"), the Company is prepared
to make available to you certain information concerning the business (including
the manner in which the Company organizes and conducts its business), financial
condition, operations, assets and liabilities of the Company. As a condition to
such information being furnished to you and your directors, officers,
employees, agents or advisors (including, without limitation, attorneys,
accountants, consultants, bankers and financial advisors) (collectively,
"Representatives"), you agree to treat any information concerning the Company
(whether prepared by the Company, its advisors or otherwise and irrespective of
the form of communication) which has been or is, in the future, furnished to
you or to your Representatives by or on behalf of the Company (collectively,
the "Evaluation Material") in accordance with the provisions of this letter
agreement, and to take or abstain from taking certain other actions hereinafter
set forth.
The term "Evaluation Material" also shall be deemed to include all notes,
analyses, compilations, studies, interpretations or other documents prepared by
you or your Representatives which contain, reflect or are based upon, in whole
or in part, the information furnished to you or your Representatives pursuant
hereto. The term "Evaluation Material" does not include information which (i) is
or becomes generally available to the public other than as a result of
disclosure by you or your Representatives, (ii) was within your possession on a
non confidential basis prior to its being furnished to you by or on behalf of
the Company, provided that the source of such information is not known by you to
be bound by a confidentiality agreement with or other contractual, legal or
fiduciary obligation of confidentiality to the Company or any other party with
respect to such information, (iii) becomes available to you on a
non-confidential basis from a source other than the Company or any of its
Representatives, provided that such source is not known by you to be bound by a
confidentiality agreement with or other contractual, legal or fiduciary
obligation of confidentiality to the Company with respect to such information or
(iv) can be shown by you to have been independently developed by you without
reliance upon any information furnished by the Company pursuant hereto.
Page 2
You hereby agree that you and your Representatives shall use the
Evaluation Material solely for the purpose of evaluating a possible negotiated
transaction between the Company and you, that the Evaluation Material will be
kept confidential and that you and your Representatives will not disclose any
of the Evaluation Material in any manner whatsoever, provided that any of such
information may be disclosed to your Representatives who need to know such
information for the sole purpose of evaluating a possible negotiated
transaction with the Company, who agree to keep such information confidential
and agree to be bound by the terms hereof to the same extent as if they were
parties hereto. In any event, you shall be responsible for any breach of this
letter agreement by any of your Representatives.
In addition, you agree that, without the prior written consent of the
Company, you and your Representatives will not disclose to any other person
other than the members of the Board of Directors of the Company and
professionals at each of Xxxxxxxxx Associates LLP and Xxxxx, Xxxxxxx &
Xxxxxxxxx, LLP that represent the Company on a regular basis the fact that the
Evaluation Material has been made available to you, that discussions or
negotiations are taking place concerning a possible transaction involving the
Company or any of the terms, conditions or other facts with respect thereto
(including the status thereof), provided that you may make such disclosure if
required by law or the rules of any securities exchange or market. The term
"person" as used in this letter agreement shall be broadly interpreted to
include the media and any corporation, partnership, group, individual or other
entity.
If you or any of your Representatives are requested or required (by oral
questions, interrogatories, requests for information or documents in legal
proceedings, subpoena, civil investigative demand or other similar process) to
disclose any of the Evaluation Material, you shall use your best efforts to
provide the Company with prompt written notice of any such request or
requirement so that the Company may seek a protective order or other
appropriate remedy and/or waive compliance with the provisions of this letter
agreement. If, in the absence of a protective order or other remedy or the
receipt of a wavier by the Company, you or any of your Representatives are
nonetheless, based on the advice of counsel, required to disclose Evaluation
Material to any tribunal or else stand liable for contempt or suffer other
censure or penalty, you or your Representatives may, without liability
hereunder, disclose to such tribunal only that portion of the Evaluation
Material which such counsel advises you is legally required to be disclosed,
provided that you exercise your best efforts to preserve the confidentiality of
the Evaluation Material, including, without limitation, by cooperating with the
Company to obtain an appropriate protective order or other reliable assurance
that confidential treatment will be accorded the Evaluation Material by such
tribunal.
If you decide that you do not wish to proceed with a transaction with the
Company, you will promptly inform the Company of that decision. In that case,
or at any time upon the request of the Company for any reason, you will
promptly deliver to the Company all Evaluation Material (and all copies
thereof) furnished to you or your Representatives by or on behalf of the
Company and will destroy all other Evaluation Material prepared by you or your
Representatives. Upon request by the Company, you will confirm in writing that
you have returned or destroyed all Evaluation Material, and all copies thereof,
in your possession. All Evaluation Material shall remain at all times the sole
and exclusive property of the Company and you shall acquire no rights in or to
such Evaluation Material by reason of its disclosure hereunder.
Page 3
You understand and acknowledge that neither the Company nor any of its
Representatives (including without limitation any of the Company's directors,
officers, employees and agents) makes any representation or warranty, express
or implied, as to the accuracy or completeness of the Evaluation Material. You
agree that neither the Company nor any of its Representatives shall have any
liability to you or to any of your Representatives relating to or resulting
from the use of the Evaluation Material or any errors therein or omissions
therefrom. Only those representations or warranties which are made in a final
definitive agreement regarding any transactions contemplated hereby, when, as
and if executed, and subject to such limitations and restrictions as may be
specified therein, will have any legal effect.
You agree not to initiate or maintain contact (except for those contacts
made in the ordinary course of business) with any officer (other than the Chief
Executive Officer of the Company), employee or agent (other than professionals
at each of Xxxxxxxxx Associates LLC and Xxxxx, Xxxxxxx & Xxxxxxxxx, LLP that
represent the Company on a regular basis) of the Company regarding its
business, operations, prospects or finances, except with the express permission
of the representative of the Company signing this letter. For avoidance of
doubt, the reference to "agent" in the previous sentence shall not include
members of the Company's Board of Directors. It is understood that the
representative of the Company signing this letter 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
the representative of the Company signing this letter.
In consideration of the Evaluation Material being furnished to you, you
hereby agree that, without the prior written consent of the Company, for a
period of one year from the date hereof, neither you nor any of your affiliates
will solicit for employment any person who is an officer or employee of the
Company as of the date of this agreement who was specifically identified to you
during the period of your investigation of the Company. The foregoing
restriction shall not prohibit SofTech Inc. from offering employment to any
officer or employee of the Company that (i) directly contacts SofTech Inc.
after the date hereof regarding potential employment opportunities with SofTech
Inc. or (ii) directly contacts SofTech Inc. after the date hereof in response
to a non-directed media advertisement regarding potential employment
opportunities with SofTech Inc.
You hereby acknowledge that you are aware and that your Representatives
have been advised that the United States securities laws prohibit any person
who has material non-public information about an issuer from purchasing or
selling securities of such issuer.
You understand and agree that no contract or agreement providing for any
transaction involving the Company shall be deemed to exist between you and the
Company unless and until a final definitive agreement has been executed and
delivered. You also agree that unless and until a final definitive agreement
regarding a transaction between the Company and you has been executed and
delivered, neither the Company nor you will be under any legal obligation of
any kind whatsoever with respect to such a transaction by virtue of this letter
agreement except for the matters specifically agreed to herein. You further
acknowledge and agree that the Company reserves the right, in its sole
discretion, to reject any and all proposals made by you or any of your
Representatives with regard to a transaction between the Company and you, and
to terminate discussions and negotiations with you at any time. The Company
acknowledges and agrees that the preceding sentence shall not constitute a
waiver of any rights you may have in your capacity as a shareholder of the
Company. Neither this paragraph
Page 4
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 provision) and explicitly make such waiver or amendment.
No failure or delay by the Company 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 future exercise thereof or the
exercise of any other right, power or privilege hereunder.
It is further understood and agreed that money damages would not be a
sufficient remedy for any breach of this letter agreement by you or any of your
Representatives and that the Company shall be entitled to equitable relief,
including injunction and specific performance, as a remedy for any such breach.
Such remedies shall not be deemed to be the exclusive remedies for a breach by
you of this letter agreement but shall be in addition to all other remedies
available at law or equity to the Company.
This letter agreement is for the benefit of the Company and its directors,
officers, stockholders, owners, affiliates and agents, and shall be governed by
and constructed in accordance with the laws of the Commonwealth of
Massachusetts. You also hereby irrevocably and unconditionally consent to
submit to the exclusive jurisdiction of the courts of the Commonwealth of
Massachusetts and of the United States of America located in the City of
Boston, Massachusetts for any actions, suits or proceedings arising out of or
relating to this agreement and the transactions contemplated hereby (and you
agree not to commence any action, suit or proceeding relating thereto except in
such courts). You hereby irrevocably and unconditionally waive any objection to
the laying of venue of any action, suit or proceeding arising out of this
agreement or the transactions contemplated hereby, in the courts of the
Commonwealth of Massachusetts or of the United States of America located in the
City of Boston, Massachusetts, and hereby further irrevocably and
unconditionally waive and agree 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.
Please confirm your agreement with the foregoing by signing and returning
one copy of this letter to the undersigned, whereupon this letter agreement
shall become a binding agreement between you and the Company.
Very truly yours,
WORKGROUP TECHNOLOGY
CORPORATION
By /s/ Xxxxxxx X. Xxxxxxx
______________________________
Name: Xxxxxxx X. Xxxxxxx
Title: President
Accepted and agreed as of the date first written above:
By /s/ Xxxxxx X. Xxxxxxxx
_____________________________________
Name: Xxxxxx X. Xxxxxxxx
Title: President and COO
