[Letter for Adams, Harkness & Hill, Inc.]
May 3, 1999
PERSONAL & CONFIDENTIAL
Mr. Brian Roussell
Chief Financial Officer
Tyco Printed Circuit Group Inc.
11 Tyco Drive
Stafford Springs, CT 06076[cad 220]0100
Re: Confidentiality Agreement (the 'Agreement')
Dear Brian:
1. You have requested information about Praegitzer Industries, Inc., (the
'Company') in connection with your consideration of a possible transaction
with the Company (a 'Transaction'). As a condition to our furnishing such
information to you, we are requiring that you agree, as set forth below, to
treat confidentially such information and any other information that the
Company, its agents or its representatives (including attorneys and financial
advisors) furnishes to you or your directors, officers, employees, agents,
advisors, prospective bank or institutional lenders, affiliates or
representatives of your agents, advisors or prospective lenders (all of the
foregoing collectively referred to as 'your Representatives'), whether
furnished before or after the date of this letter, whether communicated in
writing or orally or gathered by inspection, and all notes, analyses,
compilations, studies or other documents, whether prepared by you or others,
which contain or otherwise reflect such information and such information
shall include but not be limited to information developed by you or your
Representatives from plant visits or interviews with customers, suppliers or
employees (collectively, the 'Evaluation Material').
2. The term 'Evaluation Material' does not include information which
(i) becomes generally available to the public other than as a result of a
disclosure by you or your Representatives, (ii) was available to you on a
non-confidential basis prior to its disclosure to you by the Company, its
representatives or its agents, (iii) becomes available to you on a
non[cad 220]confidential basis from a source other than the Company, its
representatives or its agents, provided that such source is not bound by a
confidentiality agreement with the Company, its representatives or its agents
or otherwise prohibited from transmitting the information to you or your
Representatives by a contractual, legal or fiduciary obligation, or (iv) was
independently developed by you without access to or the benefit of the
Evaluation Material.
3. It is understood that you may disclose any of the Evaluation Material
to those of your Representatives who require such material for the purpose of
evaluating a possible Transaction (provided that such Representatives shall
be informed by you of the confidential nature of the Evaluation Material).
You agree that you and your Representatives will keep the Evaluation Material
confidential from any employee of the Company, except with the specific prior
consent of the Company, Adams, Harkness & Hill, Inc. or McDonald Investments,
Inc. or as otherwise permitted by the terms hereof. You further agree that
you and your Representatives will not use any of the Evaluation Material for
any reason or purpose other than to evaluate a possible Transaction.
4. Without the prior written consent of the Company, you and your
Representatives will not disclose to any person (i) the fact that the
Evaluation Material has been made available to you or that you have
inspected any portion of the Evaluation Material, (ii) the fact that any
discussions or negotiations are taking place concerning a possible
Transaction, or (iii) any of the terms, conditions or other facts with
respect to any possible Transaction, including the status thereof, unless and
only to the extent that such disclosure (after making reasonable efforts to
avoid such disclosure and after advising and consulting with the Company
about your intention to make, and the proposed contents of, such disclosure)
is, in the opinion of your counsel, which shall promptly be provided to the
Company in writing, required by applicable United States securities laws. The
term 'person' as used in this letter shall be broadly interpreted to include
without limitation any corporation, company, partnership and individual.
5. In the event that you or any of your Representatives are requested or
required (by oral questions, interrogatories, requests for information or
documents, subpoena, Civil Investigative Demand or similar process) to
disclose any of the Evaluation Material, it is agreed that you or such
Representative, as the case may be, will provide the Company with prompt
notice in writing of such request(s) so that it may seek an appropriate
protective order or other appropriate remedy and/or waive your or such
Representative's compliance with the provisions of this Agreement. In the
event that such protective order or other remedy is not obtained, or that the
Company grants a waiver hereunder, you or such Representative may furnish
that portion (and only that portion) of the Evaluation Material which, in the
written opinion of your counsel, you are legally compelled to disclose and
will exercise your best efforts to obtain reliable assurance that
confidential treatment will be accorded any Evaluation Material so furnished.
6. Without the prior written consent of the Company and except for
communications with Adams, Harkness and Hill, Inc. or McDonald Investments,
Inc., (i) neither you nor those of your Representatives who are aware of the
Evaluation Material and/or the possibility of a Transaction will initiate or
cause to be initiated any communications with any customer, supplier or
employee of the Company concerning the Evaluation Material or any possible
Transaction or any other matter concerning the Company and (ii) none of your
directors, officers or employees who are aware of the Evaluation Material
and/or the possibility of a Transaction will, for the one (1) year period
from the date of this letter agreement, either directly or indirectly solicit
or cause to be solicited the employment of or hire any employee of the
Company, unless such employee is responding to a bona fide advertisement for
employment placed by you in a newspaper or trade publication of general
circulation; provided, however, that the foregoing provision will not prevent
you from employing any person who ceases to be employed by the Company for
the previous three (3) months and that nothing herein shall preclude you from
hiring any such employee who initiates contact with you or responds to any
advertisements or general solicitation that is not specifically targeted at
such person. In addition, the provisions in this Section 6 shall not apply
to the hiring of any Company employee earning less than $20.00 per hour.
7. You will not copy or remove from the Company's premises any data,
documents, reports or other materials without the Company's express approval.
If you determine that you will not proceed with the Transaction or a
Transaction is not consummated by you, or upon the written request of the
Company, you will promptly deliver to the Company all documents or other
materials furnished by the Company to you or your Representatives
constituting Evaluation Material, together with all copies thereof in the
possession of you or your Representatives. In the event of such request, all
other documents, studies, analyses, compilations or other matter reflecting
or constituting Evaluation Material in the possession of you or your
Representatives will be destroyed, with any such destruction confirmed by you
in writing to the Company.
8. You hereby acknowledge that you are aware that the securities of the
Company are traded publicly. You hereby acknowledge that you are aware, and
that you will advise each of your Representatives and such other persons who
are informed by you as to the matters which are the subject of this letter,
that the United States securities laws prohibit any person who has received
material, non-public information from an issuer concerning the matters which
are the subject of this letter 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.
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9. In further consideration of our furnishing you with Evaluation
Material, you also agree that, for a period of two (2) years from the date of
this letter agreement, neither you nor any of your Representatives, without
the prior written consent of the Company, will:
(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 of
any successor to or otherwise, any voting securities or direct or
indirect rights to acquire any voting securities of the Company, or of
any successor to or person(s) in control of the Company, other than
voting securities acquired solely for investment purposes totaling less
than one percent (1%) of any such entity's outstanding voting
securities, 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' or '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 in respect of the voting of any voting
securities of the Company;
(c) make any public announcement in respect of or submit a proposal
for, or offer of (with or without conditions) any extraordinary
transaction involving the Company or its securities or assets;
(d) seek or propose to influence or control the Company's management
or policies; or
(e) 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 (the 'Exchange Act'), in connection with any of the foregoing.
You promptly will advise the Company of any inquiry or proposal made to
you in respect of any of the foregoing paragraph 9. You also agree that the
Company will be entitled to equitable relief, including but not limited to
injunctive relief, in the event of any breach of the provisions of these
paragraphs.
If a third party not affiliated with Tyco Printed Circuit Group Inc.
('Tyco') or any of its affiliates shall have (i) acquired or agreed to
acquire beneficial ownership of at least 10% of the outstanding shares of
capital stock of the Company, which acquisition was not induced directly or
indirectly by Tyco or any of its affiliates, and shall have filed a
Schedule 13D under the Exchange Act with the Securities and Exchange
Commission that sets forth a present intent that is other than passive in all
material respects, provided that an acquisition for investment purposes only
shall be deemed passive, or (ii) commenced or publicly announced its
intention to commence a tender or exchange offer for more than 20% of the
outstanding shares of capital stock of the Company, Tyco shall not be bound
by clauses (a) through (e) of this Section 9 unless the foregoing
third party shall have, in the case of clause (i) above, reduced its
beneficial ownership of the outstanding shares of the capital stock to below
10% or, in the case of clause (ii) above, terminated or publicly announced
its intention to terminate the tender offer, or the tender offer has
otherwise expired, without the purchase by such third party of at least 20%
of the outstanding shares of capital stock of the Company.
10. You understand that 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, and you further understand that
neither the Company nor its agents or its representatives makes any
representation or warranty as to the accuracy or completeness of the
Evaluation Material. You agree that neither the Company nor its agents or its
representatives makes any representation or warranty as to the accuracy or
completeness of the Evaluation Material. You agree that neither the Company
nor its agents or its representatives shall have any liability to you or any
of your Representatives resulting from the use of the Evaluation Material by
you or such Representatives. Only those representations and warranties that
may be made to you or your affiliates in a definitive written agreement for a
Transaction, when, as and if executed and subject to such limitations and
restrictions as may be specified therein, shall have any legal effect, and
you agree that if you determine to engage in a Transaction such determination
will be based solely on the terms of such written agreement and on your own
investigation, analysis and assessment of
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the business to be acquired. Moreover, unless and until such a definitive
written agreement is entered into, none of the Company, its affiliates or you
will be under any legal obligation of any kind whatsoever with respect to
such a Transaction except for the matters specifically agreed to in this
Agreement. The agreements set forth in this Agreement may be modified or
waived only by a separate writing signed by the Company and you expressly so
modifying or waiving such agreements.
11. You hereby agree to indemnify and hold harmless the Company from any
damage, loss, cost or liability (including legal fees and the cost of
enforcing this indemnity) arising out of or resulting from any unauthorized
use or disclosure by you or your Representatives of the Evaluation Material.
You also acknowledge that money damages would be both incalculable and an
insufficient remedy for any breach of this Agreement by you or your
Representatives and that any such breach would cause the Company irreparable
harm. Accordingly, you also agree that in the event of any breach or
threatened breach of this Agreement, the Company, in addition to any other
remedies at law or in equity it may have, shall be entitled, without the
requirement of posting a bond or other security, to equitable relief,
including injunctive relief and specific performance.
12. It is understood and agreed that 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 further exercise thereof or the exercise of any right, power or
privilege hereunder.
13. The invalidity or unenforceability of any provision of this
Agreement shall not affect the validity or enforceability of any other
provisions of this letter agreement, which shall remain in full force and
effect.
14. The rights and obligations provided by this Agreement shall expire
on the second anniversary of the date first above written.
15. You agree and consent to personal jurisdiction and service and venue
in any federal or state court within the State of Oregon having subject
matter jurisdiction, for the purposes of any action, suit or proceeding
arising out of or relating to this Agreement. This Agreement shall be
governed by and construed in accordance with the laws of the State of Oregon,
without giving effect to the conflict of laws provisions thereof.
16. If you are in agreement with the foregoing, please sign and return
one copy of this letter, which thereupon will constitute our Agreement with
respect to the subject matter hereof.
Very truly yours,
Adams, Harkness & Hill, Inc.
on behalf of Praegitzer Industries, Inc.
/s/ Mark Young
Mark Young
Vice President
Confirmed and agreed to this 3rd
day of May, 1999:
By: /s/ Brian Roussell
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Brian Roussell
Title:
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Chief Financial Officer[cad 228]Tyco Printed Circuit Group Inc.
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