EXHIBIT A
CONFIDENTIALITY AGREEMENT
This CONFIDENTIALITY AGREEMENT (this "Agreement") is made and entered
into effective October 24, 2003 by Oaktree Capital Management, LLC as agent and
on behalf of certain funds and accounts ("Recipient") for the benefit of
Wilshire Enterprises, Inc., a Delaware corporation ("Wilshire" or the "Company"
and each of Wilshire and Recipient, individually, a "Party" and Wilshire and
Recipient, collectively, the "Parties").
WITNESSETH:
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WHEREAS, Recipient has requested that it be permitted to examine
certain information (the "Evaluation Material") in the possession of Wilshire
relating to general information concerning the Company and information regarding
its oil and gas properties, its real estate properties and its corporate
operations in both the United States and Canada for the sole purpose (the
"Purpose") of enabling Recipient to make an evaluation of such properties and
the interests therein and related rights and interests of Wilshire in order to
determine whether Recipient desires to make an offer to purchase for cash the
outstanding common stock of the Company (a "Transaction").
NOW, THEREFORE, for and in consideration of the premises, Recipient
hereby agrees as follows:
1. The Evaluation Material, any other information obtained by
Recipient directly or indirectly from Wilshire or any of its employees,
consultants, agents or representatives, and any analyses, compilations, reports,
studies or other documentation prepared by Recipient or its Representatives (as
defined below) are herein collectively referred to as the "Confidential
Information". Such Confidential Information includes, by way of illustration,
but not limitation and irrespective of the form of communication: geophysical
data and surveys, well and log data, maps, charts, production and engineering
data, title and land information, technical data and financial data, prospective
drilling opportunities or other ventures with existing or new partners,
locations of properties, individual property profit and loss statements, tenant
rolls, development plans, and potential bids for individual properties owned by
the Company or others.
2. Recipient's directors, officers, employees, attorneys, agents,
consultants, financial institutions and representatives are sometimes herein
collectively referred to as its "Representatives".
3. Recipient agrees that it will use the Confidential Information
solely for the Purpose and will not use, or allow the use of any portion of same
by Recipient's Representatives, for any other purpose and, in doing so, agrees
to limit access to the Confidential Information to such of its Representatives
who have a need to review such Confidential Information for the Purpose and who
are informed by Recipient of the confidential nature of the Confidential
Information. Recipient shall be responsible and liable for ensuring that its
Representatives hold such Confidential Information in the same strict confidence
as is required of Recipient hereunder.
4. Upon Wilshire's written request, Recipient agrees to return all
original Evaluation Material to Wilshire or its advisor without retaining copies
thereof or excerpts therefrom and, concurrently therewith, to destroy all other
Confidential Information not so returned to Wilshire or its advisor that is in
its and/or its Representatives' possession.
5. Recipient agrees that until the expiration of eighteen months from
the date of this Agreement, Recipient shall not, directly or indirectly, without
the prior written approval of the Board of Directors of Wilshire, in any manner
(i) acquire, agree to acquire or make any offer to acquire, propose, seek or
offer to acquire, or facilitate the acquisition or ownership of securities or
assets of Wilshire, (ii) make, or in any way participate, directly or
indirectly, in any "solicitation" of "proxies" (as such terms are used in the
proxy rules of the Securities and Exchange Commission) to vote, or seek to
advise or influence any person with respect to the voting of any voting
securities of Wilshire or any of its subsidiaries, (iii) otherwise act, alone or
in concert with others, to seek to control or influence the management or the
policies of Wilshire or any of its subsidiaries, (iv) disclose any intention,
plan or arrangement prohibited by, or inconsistent with, the foregoing or (v)
advise, assist or encourage or enter into any discussions, negotiations,
agreements or arrangements with any other persons in connection with the
foregoing with the exception of Xxxxx XxXxxxxx of Summit Capital LLC; provided
that the restrictions set forth in clause (i) above shall not apply to
confidential proposals made to Wilshire's advisors concerning a Transaction.
Recipient also agrees during such period (a) not to request Wilshire (or its
directors, officers, employees or agents), directly or indirectly, to amend or
waive any provision of this paragraph and (b) not to take any action that
requires Wilshire to make a public announcement regarding the possibility of a
business combination, merger or other type of transaction described in this
paragraph to avoid potential liability, provided that Recipient may disclose
this letter agreement in an amendment to its Form 13D on file.
6. The confidentiality obligations contained in this Agreement shall
continue for a period of eighteen months from the effective date hereof.
7. Recipient shall not reproduce or remove any Evaluation Material
from Wilshire's offices without Wilshire's express permission. All Confidential
Information and copies thereof and excerpts therefrom shall remain or become
Wilshire's property, and Wilshire retains all right, title and interest therein.
8. Recipient's obligations under Section 3, 4, 6 and 7 above shall not
apply to: (a) information which at the time of initial disclosure hereunder was
already in the possession of Recipient or its Representatives; (b) information
which at the time of initial disclosure hereunder was in the public domain or
which after disclosure becomes a part of the public domain through no action or
failure to act on the part of Recipient or any of its Representatives; and (c)
information which at the time of initial disclosure hereunder was or is
thereafter lawfully acquired by Recipient or its Representatives from a source
other than Wilshire, provided to the best of Recipient's knowledge (i) such
source was not under an obligation of confidence to Wilshire with respect
thereto and (ii) did not acquire such information directly or indirectly from
Wilshire.
9. Recipient acknowledges and agrees that Wilshire, in its sole
discretion, (a) is free to explore other potential opportunities that may lead
to a possible transaction with another party, (b) may change the procedures
relating to its consideration of a transactions at any time without prior
notice, (c) may reject any and all proposals made by Recipient with respect to a
possible Transaction, (d) may terminate discussions with Recipient at any time
and for any reason, and (e) will have no obligation or liability to Recipient
with regard to a possible Transaction by virtue of this Agreement or otherwise,
unless and until and only in the event that definitive agreements have been
executed for a Transaction. Accordingly, Wilshire may elect at any time to
terminate further access to and review of the Confidential Information, at which
time the obligations of Recipient contained in Section 4 above shall be
applicable.
10. Except as may be set forth in a definitive agreement between the
parties, Recipient understands and agrees that Wilshire is making no express
warranty and disclaims all implied warranties as to the accuracy or completeness
of the Confidential Information, including the Evaluation Material furnished by
Wilshire or located in Wilshire's offices.
11. Except as may be set forth in a definitive agreement between the
parties, Recipient agrees that it and its Representatives will use the
Confidential Information at their sole risk, and Wilshire will have no liability
whatsoever with respect to the use of the same. Except as may be set forth in a
definitive agreement between the parties, Recipient hereby releases Wilshire,
its affiliates and their respective
directors, officers, employees, consultants, agents and representatives (the
"Indemnified Parties") from, and agrees to defend, indemnify and hold harmless
all Indemnified Parties from and against, any and all claims, liabilities,
losses or damages resulting in any way from or attributable to such reliance.
12. In the event any Representative or Recipient is permitted at any
time to visit the Company's headquarters or its property locations, such visit
shall be conducted at the sole cost, risk and expense of Recipient. Recipient
hereby agrees to defend, indemnify and hold harmless all Indemnified Parties
from and against any and all claims for injury, death, property damages or other
loss resulting from or attributable to any such visit, regardless of the cause
of same excerpt gross negligence or willful misconduct of Wilshire or its
employees. Recipient agrees that it will not contact the Company's employees or
management and will direct all communications through the Company's advisors.
13. Recipient acknowledges and agrees that remedies at law may be
inadequate to protect Wilshire against any actual or threatened breach of this
Agreement by Recipient or its Representatives, and accordingly, Recipient agrees
that Wilshire shall be entitled to obtain injunctive relief in its favor. Such
remedy shall not be deemed to be the exclusive remedy for a breach by Recipient
or its Representatives of this Agreement, but rather shall be in addition to all
other remedies available to Wilshire at law or in equity. In the event of
litigation relating to this Agreement, then the non-prevailing party shall
reimburse the prevailing party for its costs and expenses (including, but not
limited, to, reasonable legal fees and expenses) incurred in connection with any
such litigation as concerns such breach, including, but not limited to, in
connection with any appeal therefrom.
14. Notices to either Party with regard to any matter covered by this
Agreement shall be made in writing and (a) delivered in person, by U.S. mail,
postage prepaid, or overnight courier service, such notice to be deemed given
upon actual receipt, or (b) facsimile, such notice to be deemed given upon
confirmation of the receipt thereof.
15. If Recipient or any its Representatives are required by any court
or legislative or administrative body (by oral questions, interrogatories,
requests for information or documents, subpoena or similar process) to disclose
any Confidential Information, Recipient shall provide Wilshire promptly with
written notice of such requirement in order to afford Wilshire an opportunity to
seek an appropriate protective order. Recipient and its Representatives agree to
cooperate with any reasonable request of Wilshire in its efforts to secure such
protective order. If Wilshire is unable to obtain such protective order,
however, or does not seek such protective order and Recipient or its
Representatives are, in the opinion of their counsel, compelled to disclose the
Confidential Information under pain of liability for contempt, censure or
penalty, disclosure of such information may be made without liability hereunder.
16. No failure or delay by Wilshire in exercising any right, power or
privilege hereunder shall be deemed a waiver thereof or preclude exercise of any
other or further right, power or privilege hereunder. No amendments, changes, or
modifications to this Agreement shall be valid unless in writing and signed by a
duly authorized representative of each of the Parties. This Agreement comprises
the full and complete agreement of the Parties with respect to the subject
matter hereof, and supersedes and replaces any oral or written communications,
understandings and agreements heretofore made between the Parties with respect
to such subject matter. This Agreement shall inure to the benefit of Wilshire
and its successors and assigns, and shall be binding upon Recipient and its
Representatives and their heirs, representatives, successors and assigns,
provided that Recipient may not assign any of its rights or obligations
hereunder to any third party without the prior written consent of Wilshire. Any
attempted assignment without such consent shall be null and void. This Agreement
shall be governed by the laws of the state of Delaware, excluding its choice of
law rules, and any disputes hereunder shall be heard solely in state or federal
courts sitting in the state of New Jersey, and each party consents to the
jurisdiction of such courts for those purposes. This Agreement may be executed
in multiple counterparts, each of which shall be deemed an original, but all of
which together shall constitute a single agreement.
IN WITNESS WHEREOF, the duly authorized representative of Recipient
has executed this Agreement effective as of the day and year first above
written.
Oaktree Capital Management, LLC, as agent and on
behalf of certain funds and
accounts
By: /s/ Xxxx Xxxxxxx
Name: Xxxx Xxxxxxx
Title: Senior Vice President
By: /s/ Xxxx Xxxxxxxx
Name: Xxxx Xxxxxxxx
Title: Senior Vice President, Legal
DELOITTE & TOUCHE CORPORATE FINANCE LLC as a representative:
By: /s/ X. Xxxxx
Name: X. Xxxxx
Title: Managing Director
10/24/03
