EXHIBIT 2
Wellsford Real Properties, Inc.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
December 28, 1999
First Union Real Estate Equity
and Mortgage Investments
00 Xxxxxx Xxxxxx
Xxxxx 0000
Xxxxxxxxx, XX 00000
Ladies and Gentlemen:
First Union Real Estate Equity and Mortgage Investments ("First
Union") and Wellsford Real Properties, Inc. ("WRP") have expressed an
interest in exploring a possible transaction (the "Transaction") and, in
connection therewith, may exchange certain confidential information.
As used herein, "Confidential Material" means, with respect to
either party hereto (each a "Providing Party"), all information, whether
oral, written or otherwise (including any information furnished prior to
the execution of this agreement), furnished to the other party hereto (each
a "Receiving Party") or to such Receiving Party's directors, trustees,
officers, partners, members, managers, Affiliates (as defined in Rule 12b-2
under the Securities Exchange Act of 1934 (the "Exchange Act")), employees,
agents or representatives (collectively, "Representatives"), by the
Providing Party and all reports, analyses, compilations, studies and other
materials prepared by the Receiving Party or its Representatives (in
whatever form maintained, whether documentary, computer storage or
otherwise) containing, reflecting or based upon, in whole or in part, any
such proprietary confidential information. The term "Confidential Material"
does not include information which (i) is or becomes generally available to
the public other than as a result of a disclosure by the Receiving Party,
its Representatives or anyone to whom the Receiving Party or any of its
Representatives transmit any Confidential Material in violation of this
agreement or (ii) is or becomes known or available to the Receiving Party
or its Representatives on a non-confidential basis from a source (other
than the Providing Party or one of its Representatives) who is not, to the
knowledge of the Receiving Party after reasonable inquiry, prohibited from
transmitting the information to the Receiving Party or its Representatives
by a contractual, legal or fiduciary obligation.
In consideration of the exchange of the Confidential Material,
First Union and WRP agree that:
1. Subject to paragraph 3 below, the Confidential Material will
be kept confidential and will not, without the prior written consent of the
Providing Party, be disclosed by the Receiving Party or its
Representatives, in whole or in part, and will not be used by the Receiving
Party or its Representatives, directly or indirectly, for any purpose other
than in connection with evaluating, negotiating or advising with respect to
a possible Transaction. Moreover, such Receiving Party agrees to disclose
that it is evaluating a Transaction and transmit Confidential Material to
its Representatives only if and to the extent that such Representatives
need to know the Confidential Material for the purpose of evaluating,
negotiating or advising with respect to such Transaction and are informed
by such Receiving Party of the confidential nature of the Confidential
Material and of the terms of this agreement. In any event, each Receiving
Party will be responsible for any actions by its Representatives which are
not in accordance with the provisions hereof.
2. Subject to paragraph 3 below, without the prior written
consent of the other party hereto, except as required by law, neither First
Union nor WRP nor any of their respective Representatives will disclose to
any person any information regarding a possible Transaction or any
information relating in any way to the Confidential Material, including,
without limitation,(i) the fact that discussions or negotiations are taking
place concerning a possible Transaction, including the status thereof or
the termination of discussions or negotiations, (ii) any of the terms,
conditions or other facts with respect to any such possible Transaction or
(iii) that this agreement exists or that Confidential Material has been
provided. The term "Person" as used in this agreement shall be broadly
interpreted to include, without limitation, any corporation, company,
group, limited liability company, partnership or other entity or any
individual.
3. In the event that either the Receiving Party, or its
Representatives or anyone to whom such Receiving Party or its
Representatives supply the Confidential Material or any of the facts or
information referred to in paragraph 2 above, are requested or required (by
oral questions, interrogatories, requests for information or documents,
subpoena, civil investigative demand, any informal or formal investigation
by any government or governmental agency or authority or otherwise in
connection with legal processes) to disclose any Confidential Material or
any of the facts or information referred to in the immediately preceding
paragraph or any information relating to a possible Transaction or such
Person's opinion, judgment, view or recommendation concerning the Providing
Party as developed from the Confidential Material, such Receiving Party
agrees (i) to immediately notify the Providing Party of the existence,
terms and circumstances surrounding such a request,(ii) to consult with the
Providing Party on the advisability of taking legally available steps to
resist or narrow such request and (iii) if disclosure of such information
is required, to furnish only that portion of the Confidential Material
which, in the opinion of such Receiving Party's counsel, such Receiving
Party is legally compelled to disclose and to cooperate with any action by
the Providing Party to obtain an appropriate protective order or other
reliable assurance that confidential treatment will be accorded the
Confidential Material, it being agreed that the Providing Party shall
reimburse the Receiving Party for all reasonable out-of-pocket expense
incurred by the Receiving Party in connection with such cooperation.
4. Each of First Union and WRP hereby acknowledges that it is
aware, and agrees to advise such of its Representatives who are informed in
accordance with the terms of this agreement as to the matters which are the
subject of this agreement, that the United States securities laws prohibit
any person who has received from an issuer material, non-public information
concerning the matters which are the subject to this agreement 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.
5. Each Receiving Party hereby acknowledges that the Confidential
Material is being furnished to it in consideration of its agreement that,
for a period of one year from the date hereof, neither such Receiving Party
nor its Affiliates shall, directly or indirectly, (a)(x) solicit, seek or
offer to effect or effect, (xx) negotiate with or provide any information
to the Board of Directors or Board of Trustees, as the case may be, of the
Providing Party, any trustee, director or officer of the Providing Party or
any stockholder of the Providing Party with respect to, (xxx) make any
statement or proposal, whether written or oral, either alone or in concert
with others, to the Board of Directors or Board of Trustees, as the case
may be, of the Providing Party, any director or officer of the Providing
Party or any stockholder of the Providing Party or any other person with
respect to, or (xxxx) make any public announcement (except as required by
law in respect of actions permitted hereby) or proposal or offer whatsoever
(including, but not limited to, any "solicitation" or "proxies" as such
terms are defined or used in Regulation 14A of the Exchange Act) with
respect to, (i) any form of business combination or similar or other
extraordinary transaction involving the Providing Party or any Affiliate
thereof, including, without limitation, a merger, tender or exchange offer
or liquidation of the Providing Party's assets, (ii) any form of
restructuring, recapitalization or similar transaction with respect to the
Providing Party or any Affiliate thereof, (iii) any purchase of any
securities or assets, or rights or options to acquire any securities or
assets (through purchase, exchange, conversion or otherwise), of the
Providing Party or any Affiliate thereof, (iv) any proposal to seek
representation on the Board of Directors or Board of Trustees, as the case
may be, of the Providing Party or to seek to appoint, elect or remove any
member of the Board of Directors or Board of Trustees, as the case may be,
of the Providing Party or make any public statements proposing or
suggesting any change in the Board of Directors or Board of Trustees, a the
case may be, or management of the Providing Party or otherwise to seek to
control or influence the management, Board of Directors or Board of
Trustees, as the case may be, or policies of the Providing Party or any
Affiliate thereof, (v) any request or proposal to waive, terminate or amend
the provisions of this agreement or (vi) any proposal or other statement
inconsistent with the terms of this agreement or (b) instigate, encourage,
join, act in concert with or assist (including, but not limited to,
providing or assisting in any way in the obtaining of financing for, or
acting as a joint or co- bidder for the Providing Party with) any third
party to do any of the foregoing (the actions referred to in (a) and (b) in
this sentence are referred to as "Prohibited Actions"), unless and until
such Receiving Party has received the prior written invitation or approval
of a majority of the Board of Directors or Board of Trustees, as the case
may be, of the Providing Party to do any of the foregoing, it being agreed
and understood that the entering into of this agreement shall not
constitute such invitation or approval.
6. Each Receiving Party acknowledges that neither the Providing
Party nor any of its Representatives has made, or, except as may be
otherwise provided in any definitive agreement relating to a Transaction,
will make, any representation or warranty, express or implied, as to the
accuracy or completeness of the Confidential Material. Each Receiving Party
agrees that, except as may be otherwise provided in any definitive
agreement relating to a Transaction, neither the Providing Party nor its
Representatives shall have any liability to such Receiving Party or any of
its Representatives resulting from the Confidential Material or the
Receiving Party's or its Representatives' consideration of, or
participation in a process relating to, a possible Transaction.
7. Promptly upon request from either Providing Party, the
Receiving Party shall, except to the extent prevented by law, redeliver to
the Providing Party or destroy all tangible Confidential Material delivered
to it or its Representatives and any other tangible material containing,
prepared on the basis of, or reflecting any information in the Confidential
Material (whether prepared by the Providing Party, its advisors or
otherwise), including all reports, analyses, compilations, studies and
other materials containing or based on the Confidential Material or
reflecting such Receiving Party's review of, or interest in, such Providing
Party, and will not retain any copies, extracts or other reproductions in
whole or in part of such tangible material. Any such destruction shall be
certified in writing to the Providing Party by an authorized officer of the
Receiving Party supervising the same.
8. Each of First Union and WRP acknowledges and agrees that in
the event of any breach of this agreement by either party, the other party
would be irreparably and immediately harmed and could not be made whole by
monetary damages. It is accordingly agreed that each party, in addition to
any other remedy to which it may be entitled in law or equity, shall be
entitled to an injunction or injunctions to prevent breaches of this
agreement by the other party or by any non-party recipient of the
Confidential Material and to compel specific performance of this agreement,
without the need for proof of actual damages. Further, each party hereby
waives any request for or the seeking or posting of any bond in connection
with such injunction or injunctions.
9. Each of First Union and WRP agrees that (i) unless and until a
definitive written agreement between them with respect to a Transaction has
been executed and delivered, neither First Union nor WRP will be under any
legal obligation of any kind whatsoever with respect thereto and (ii) this
agreement shall be superseded by such definitive written agreement, except
to the extent otherwise provided therein. The agreements set forth in this
agreement may be modified or waived only by a written instrument duly
executed by First Union and WRP.
10. Each of First Union and WRP agrees that for a period of two
years from the date hereof it will not solicit to hire any person then
currently employed by the other party.
11. Each of First Union and WRP agrees that it will not contact
or solicit information from any of the other party's stockholders,
employees, tenants, vendors or lenders except to the extent approved in
writing by such other party, which consent will not be unreasonably
withheld or delayed if such other party intends to continue discussions
regarding a Transaction.
12. It is understood and agreed that no failure or delay by
either party hereto 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. This agreement shall be governed by, and construed in
accordance with, the laws of the State of New York, without regard to the
principles of conflict of laws thereof. This agreement may not be assigned
in whole or in part by either party without the prior written consent of
the other party. This agreement may be executed in counterparts, each of
which shall be deemed to be an original, and all of which shall constitute
the same agreement.
14. Notwithstanding anything contained herein to the contrary,
this agreement is made and executed on behalf of First Union by its
officer(s) on behalf of the trustees thereof, and none of the trustees or
any additional or successor trustee hereafter appointed, or any
beneficiary, officer, employee or agent of First Union shall have any
liability in his or her personal or individual capacity, but instead, WRP
shall look solely to the property and assets of First Union for
satisfaction of claims of any nature arising under or in connection with
this agreement.
Very truly yours,
WELLSFORD REAL PROPERTIES, INC.
By: /s/ Xxxxxx Xxxxxxxxx
------------------------------
Agreed:
FIRST UNION REAL ESTATE AND
MORTGAGE INVESTMENTS
By: /s/ Xxxxxxx X. Xxxxxx
--------------------------
Chairman
