May 21, 1996
Kash n' Xxxxx Food Stores, Inc.
0000 Xxxxxx Xxxx
Xxxxx, Xxxxxxx 00000
Ladies and Gentlemen:
We have agreed to provide to you certain information relating to Food Lion,
Inc. (the "Company") in connection with the Company's possible negotiated
transaction relating to your business and assets (a "Transaction").
As a condition to the furnishing of the requested information to you, you
agree that: (i) all information relating to the Company furnished by or on
behalf of the Company to you, whether prior to or after your acceptance of this
letter and irrespective of the form of communication, or learned by you in
connection with visits to the Company's facilities (such information, together
with notes, memoranda, summaries, analyses, compilations and other writings
relating thereto or based thereon prepared by you, being referred to herein as
the "Evaluation Material"), will be kept strictly confidential and not disclosed
to any person or entity (including your Representatives (as defined below),
agents or employees or officers) other than those designated on Schedule 1
hereto (the "Designated Recipients"); and (ii) the Evaluation Material will be
used solely for the purpose of discussions with the Company relating to a
Transaction. The term "Evaluation Material" does not include information which
is or becomes available to you on a non-confidential basis from a source other
than the Company or its affiliates or Representatives, provided that you are not
aware that such source is under an obligation (whether contractual, legal or
fiduciary) to the Company to keep such information confidential. For purposes
hereof, the "Representatives" of any entity mean such entity's directors,
officers, employees, legal and financial advisers, accountants and other agents
and representatives. You will be responsible for any breach of this agreement by
the Designated Recipients and agree to take all reasonable measures to restrain:
(i) your Representatives (other than the Designated Recipients) from obtaining
any Evaluation Material; and (ii) the Designated Recipients from disclosing or
using the Evaluation Material. You shall advise the Designated Recipients of the
existence of this Agreement and their obligations hereunder.
In addition, each of the parties hereto agree that, except with the prior
written consent of the other party hereto or as required or permitted by this
agreement, such party will not, and will direct its Representatives not to, make
any release to the press or other public disclosure concerning the existence of
this letter or that the Evaluation Material has been made available to you,
except for such public disclosure as may be necessary, in the written opinion of
such party's outside counsel, for such party not to be in violation of or
default under any applicable law, regulation or governmental order. If either
party hereto proposes to make any disclosure based upon the opinion, such party
will deliver a copy of such opinion to the other party hereto together with the
text of the proposed disclosure as far in advance of its disclosure as is
practicable, and will in good faith consult with and consider the suggestions of
the other party hereto and its Representatives concerning the nature and scope
of the information proposed to be disclosed.
If you or any of your Representatives are requested in any judicial or
administrative proceeding or by any governmental or regulatory authority to
disclose any Evaluation Material, you will (i) give the Company prompt written
notice of such request so that it may seek an appropriate protective order, and
(ii) consult with the Company as to the advisability of taking legally available
steps to resist or narrow such a request. You will cooperate fully with the
Company in obtaining such an order. If, in the absence of a protective order,
you are nonetheless compelled to disclose Evaluation Material, the Company
agrees that you may make such disclosure without liability hereunder, provided
that you give the Company written notice of the information to be disclosed as
far in advance of its disclosure as is practicable and, upon the Company's
request and at its expense, use your best efforts to obtain reasonable assurance
that confidential treatment will be accorded to such information.
At any time, upon the Company's request, you will promptly (and in no event
later than five (5) business days after such request) redeliver or cause to be
redelivered to the Company all copies of the Evaluation Material furnished to
you by or on behalf of the Company and destroy or cause to destroyed all
Evaluation Material prepared by you. Notwithstanding the return or destruction
of the Evaluation Material, you will continue to be bound by your obligations
hereunder.
You hereby acknowledge that you are aware of the restrictions imposed by
Federal and state securities laws on a person possessing material nonpublic
information about a company. In this regard, you hereby agree that, while you
are in possession of material nonpublic information with respect to the Company,
you will not purchase or sell any securities of the Company, or communicate such
information to any third party, in violation of such laws.
In consideration for access to the Evaluation Material which you have
requested, you agree not to initiate or maintain contact with any officer,
director, employee or agent of the company regarding its business, operations,
prospects, finances or any other matter pertaining to the Company, other than by
contacting X. Xxxxxxx XxXxxxxxx or his designee(s) first.
You further agree that, for a period of eighteen (18) months from the date
hereof, neither you nor any of your affiliates will solicit, either directly or
indirectly through recruiters or other agents, to employ any officer or
management employee of the Company above the store level, so long as they are
employed by the Company, without obtaining the prior written consent of the
Company. The term "solicit to employ" does not include general solicitations of
employment not specifically directed towards employees of the Company.
Neither the Company nor you will have any rights or obligations of any kind
whatsoever with respect to a Transaction by virtue of this agreement.
You hereby acknowledge and agree that this agreement is for the benefit of
the Company and its successors and assigns, and that they shall be entitled to
enforce the provisions hereof as though parties hereto. You acknowledge and
agree that money damages would not be a sufficient remedy for any breach of any
provision of this agreement by you, and that, in addition to all other remedies
which the Company may have, the Company will be entitled to specific performance
and injunctive or other equitable relief as a remedy for any such breach. No
failure or delay by the Company 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 contains the sole and entire agreement between the parties
with respect to the subject matter hereof. This agreement may be amended,
modified or waived only by a separate written instrument duly executed by or on
behalf of the Company and you. This agreement shall be governed by and construed
in accordance with the laws of the State of New York without giving effect to
the conflicts of laws or principles thereof.
Except to the extent that any provision of this agreement by its terms
terminates sooner, this agreement shall terminate on the second anniversary of
the date hereof.
If the foregoing correctly sets forth our agreement with respect to the
matters set forth herein, please so indicate by signing two copies of this
agreement and returning one such signed copies to us, whereupon this agreement
will constitute a binding agreement with respect to the matters set forth
herein.
Very truly yours,
FOOD LION, INC.
By: /s/ X. XXXXXXX XXXXXXXXX
-----------------------------------------
Name: X. Xxxxxxx XxXxxxxxx
Title: Senior Vice President
ACCEPTED AND AGREED AS OF THE
DATE FIRST WRITTEN ABOVE:
KASH N' XXXXX FOOD STORES, INC.
By: /s/ XXXXXX X. XXXXXXX
-------------------------
Name: Xxxxxx X. Xxxxxxx
Title: President
SCHEDULE 1
Xxxxxx X. Xxxxxxx
Xxxxxxx X. Xxxxxxx
Xxxxxxxx X. Xxxxx, Xx.
X.X. Xxxxxxxx
Xxxxx Xxxxx
Xxxxx Xxxxxxxxx
