Exhibit (d)(2)
August 9, 2000
Xx. Xxxxxx Xxxxx
Electronics For Imaging, Inc.
000 Xxxxxxxx Xxx
Xxxxxx Xxxx, Xxxxxxxxxx 00000
Dear Xxx:
In connection with your consideration of a possible negotiated business
combination transaction (a "Transaction") between Splash Technology Holdings,
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Inc. a Delaware corporation (the "Company") and Electronics For Imaging, Inc., a
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Delaware corporation (hereinafter "you"), the Company and you expect to make
available to one another certain information concerning their respective
business, financial condition, operations, assets and liabilities which is non-
public, confidential or proprietary in nature (herein collectively referred to
as the "Evaluation Material"). As a condition to Evaluation Material being
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furnished to each party and its directors, officers, employees, agents or
advisors (including, without limitation, attorneys, accountants, consultants,
bankers and financial advisors) (collectively, "Representatives"), each party
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agrees to treat any Evaluation Material concerning the other party (whether
prepared by the disclosing party, its advisors or otherwise and irrespective of
the form of communication) which is furnished hereunder to a party or to its
Representatives now or in the future by or on behalf of the disclosing party in
accordance with the provisions of this letter agreement, and to take or abstain
from taking certain other actions hereinafter set forth.
(1) Evaluation Material. Evaluation Material, if disclosed in written
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form, shall be designated in writing to be confidential or proprietary. The
term "Evaluation Material" also shall be deemed to include all notes, analyses,
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compilations, studies, interpretations or other documents prepared by each party
or its Representatives which contain, reflect or are based upon, in whole or in
part, the information furnished to such party or its Representatives pursuant
hereto. The term "Evaluation Material" does not include information which (i)
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is or becomes generally available to the public other than as a result of a
disclosure by the receiving party or its Representatives, (ii) is or becomes
available to the receiving party on a non-confidential basis from a source other
than the disclosing party or any of its Representatives, provided that, to the
knowledge of the receiving party, such source is not bound by a confidentiality
agreement with or other contractual, legal or fiduciary obligation of
confidentiality to the disclosing party or any other party with respect to such
information, (iii) conveyed orally and is not related to the business or
operations of a party, (iv) is in the possession of the receiving party at the
time of disclosure as shown by the receiving party's files and records in
existence prior to the time of disclosure, (v) is developed independently by the
receiving party without use of or reference to the Evaluation Material of the
disclosing party, or (vi) becomes available to the receiving party by lawful
inspection or analysis of products offered for sale. Nothing herein shall
constitute an admission by either party that any Evaluation Material in fact
contains material nonpublic information concerning the disclosing party or is,
in fact, confidential information of the disclosing party.
(2) Purpose of Disclosure of Evaluation Material. It is understood and
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agreed by each party that any exchange of information under this agreement shall
be solely for the purpose of evaluating a Transaction between the parties and
not to effect, in any way, each party's relative competitive position to the
other party or to other entities. It is further agreed, that the information to
be disclosed to each other shall only be that information which is reasonably
necessary to a Transaction and that information which is not reasonably
necessary for such purposes shall not be disclosed or exchanged, unless
otherwise agreed. In addition, disclosure of competitively sensitive information
such as information concerning product development or marketing plans, product
prices or pricing plans, cost data, customers or similar information which has
been determined to be reasonably necessary to a Transaction, shall be limited
only to those senior executives, employees and Representatives who have a need
to know for purposes of evaluating or negotiating a Transaction or approving the
value of a Transaction.
(3) Use of Evaluation Material. Each party hereby agrees that it and its
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Representatives shall use the other's Evaluation Material solely for the purpose
of evaluating a possible Transaction between the parties, and that the
disclosing party's Evaluation Material will be kept confidential and each party
and its Representatives will not disclose or use for purposes other than the
evaluation of a Transaction any of the other's Evaluation Material in any manner
whatsoever, provided, however, that (i) the receiving party may make any
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disclosure of such information to which the disclosing party gives its prior
written consent and (ii) any of such information may be disclosed to the
receiving party's Representatives who need to know such information for the sole
purpose of evaluating a possible Transaction between the parties, who agree to
keep such information confidential and agree to be bound by the confidentiality
provisions hereof to the same extent as if they were parties hereto. Except as
otherwise permitted by law, neither party shall reverse engineer, disassemble or
decompile any prototypes, software or other tangible objects which embody the
other party's Evaluation Material and which are provided to the party hereunder.
(4) Non-Disclosure. In addition, each party agrees that, without the prior
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written consent of the other party, neither it nor its Representatives will
disclose to any other person not involved in the evaluation or Transaction the
fact that any Evaluation Material has been made available hereunder, that
discussions or negotiations are taking place concerning a Transaction involving
the parties or any of the terms, conditions or other facts with respect thereto
(including the status thereof), provided that a party may make such disclosure
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if in the opinion of a party's outside counsel, such disclosure is necessary to
avoid committing a violation of law. In such event, the disclosing party shall
use its best efforts to give advance notice to the other party. The terms of
confidentiality under this letter agreement shall not be construed to limit
either party's right to independently develop or acquire products without use of
the other party's Evaluation Material. The disclosing party acknowledges that
the receiving party may currently or in the future be developing information
internally, or receiving information from other parties, that is similar to the
Evaluation Material. Accordingly, nothing in this letter agreement will be
construed as a representation or agreement that the receiving party will not
develop or have developed for it products, concepts, systems, or techniques that
are similar to or compete with the products, concepts, systems or techniques
contemplated by or embodied in the Evaluation Material provided that the
receiving party does not violate any of its obligations under this letter
agreement in connection with such development.
(5) Required Disclosure. In the event that a party or its Representatives
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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 other party's Evaluation
Material, the party requested or required to make the disclosure shall provide
the other party with prompt notice of any such request or requirement so that
the other party 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 waiver by such
other party, the party requested or required to make the disclosure or any of
its Representatives are nonetheless, in the opinion of counsel, legally
compelled to disclose the other party's Evaluation Material to any tribunal or
else stand liable for contempt or suffer other censure or penalty, the party
requested or required to make the disclosure or its Representative may, without
liability hereunder, disclose to such tribunal only that portion of the other
party's Evaluation Material which such counsel advises is legally required to be
disclosed, provided that the party requested or required to make the disclosure
exercises its reasonable efforts to preserve the confidentiality of the other
party's Evaluation Material, including, without limitation, by cooperating with
the other party to obtain an appropriate protective order or other reliable
assurance that confidential treatment will be accorded the other party's
Evaluation Material by such tribunal.
(6) Non-Solicitation. For a period of one (1) year subsequent to the
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termination of discussions regarding a Transaction, neither party shall directly
or indirectly solicit for hire any employee of the other party or any of its
subsidiaries with whom it has first had contact or who first became known to it
in connection with its consideration of a Transaction; provided, however, that
the foregoing provision shall not prevent either party from (i) employing an
employee who contacts such party, directly or indirectly through an
intermediary, at his or her own initiative without any direct or indirect
solicitation by or encouragement from such party; or (ii) placing advertisements
in newspapers consistent with such party's past practices or using recruiters,
provided such recruiters have not been directed, either directly or indirectly,
to contact the other party's employees.
(7) Standstill. Beginning on the date of this letter agreement and
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continuing for a period of one (1) year after the date of a notice of
termination of discussions under Section (8) below, each party and its officers,
directors, subsidiaries and persons in control of such party will not (and each
party and its officers, directors, subsidiaries and persons in control of such
party will not assist or encourage others to), directly or indirectly, unless
specifically requested to do so in writing in advance by the other party's Board
of Directors:
(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 other party or any
subsidiary thereof, or of any successor to or person in control of the other
party, or any assets of the other party 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 ("SEC")), or seek to advise or influence any
person or entity with respect to the voting of any voting securities of the
other party;
(c) make any public announcement with respect to, or submit a
proposal for, or offer of (with or without conditions) any extraordinary
transaction involving the other party or any of its securities or assets;
(d) 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;
(e) otherwise act or seek to control or influence the management,
Board of Directors or policies of the other party; or
(f) take any action that could reasonably be expected to require the
other party to make a public announcement regarding the possibility of any of
the events described in clauses (a) through (e) above.
(8) Termination of Discussions. If either party decides that it does not
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wish to proceed with a Transaction with the other party, the party so deciding
will promptly inform the other party of that decision by giving a written notice
of termination. In that case, or at any time, upon the request of either
disclosing party for any reason, each receiving party will, at its option,
promptly either (i) deliver to the disclosing party all Evaluation Material (all
copies thereof) furnished to the receiving party or its Representatives by or on
behalf of the disclosing party pursuant hereto or (ii) destroy all such
Evaluation Material with no copy thereof being retained, and in no event shall
either party be obligated to disclose or provide the Evaluation Material
prepared by it or its Representatives to the other party. Notwithstanding the
return or destruction of the Evaluation Material, each party and its
Representatives will continue to be bound by its obligations of confidentiality
hereunder for a period of three (3) years after the date of written notice of
termination.
(9) No Representation of Accuracy. Each party understands and acknowledges
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that neither party nor any of its Representatives makes any representation or
warranty, express or implied, as to the accuracy or completeness of the
Evaluation Material made available by it or to it. Each party agrees that
neither party nor any of its Representatives shall have any liability to the
other party or to any of its Representatives relating to or resulting from the
use of such other party's Evaluation Material or any errors therein or omissions
therefrom. Only those representations or warranties which are made in a final
definitive agreement regarding the Transaction, when, as and if executed, and
subject to such limitations and restrictions as may be specified therein, will
have any legal effect.
(10) Definitive Agreements. Each party understands and agrees that no
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contract or agreement providing for any Transaction involving the parties shall
be deemed to exist between the parties unless and until a final definitive
agreement has been executed and delivered. Each party also agrees that unless
and until a final definitive agreement regarding a Transaction between the
parties has been executed and delivered, neither party 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.
Both parties further acknowledge and agree that, until final definitive
agreement regarding a Transaction between the parties has been executed and
delivered, each party reserves the right, in its sole discretion, to reject any
and
all proposals made by the other party or any of its Representatives with regard
to a Transaction between the parties, and to terminate discussions and
negotiations at any time.
(11) Waiver. It is understood and agreed that no failure or delay by
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either party 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.
(12) Miscellaneous. Each party agrees to be responsible for any breach of
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this agreement by any of its Representatives. In case any provision of this
agreement shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions of the agreement shall not in any way
be affected or impaired thereby.
(13) Governing Law; Consent to Jurisdiction. This agreement shall be
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governed by and construed in accordance with the laws of the State of California
without giving effect to choice of law doctrines. Each party hereto consents to
non-exclusive jurisdiction in the courts of Santa Xxxxx County, California and
voluntarily submits to the jurisdiction of such courts in any action or
proceeding with respect to this agreement, including the federal district courts
located in such County. Both parties agree that they may be served with process
at their address set forth on the first page hereof.
(14) Injunctive Relief. It is further understood and agreed that money
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damages would not be a sufficient remedy for any breach of this letter agreement
by either party or any of its Representatives and that the non-breaching party
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 of this letter agreement but shall be
in addition to all other remedies available at law or equity. In the event of
litigation relating to this letter agreement, if a court of competent
jurisdiction determines that either party or any of its Representatives have
breached this letter agreement, then the breaching party shall be liable and pay
to the non-breaching party the reasonable legal fees incurred in connection with
such litigation, including an unsuccessful appeal therefrom.
(15) Entire Agreement. This letter agreement contains the entire agreement
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between the parties hereto concerning confidentiality of their respective
Evaluation Material, and no modification of this letter agreement or waiver of
the terms and conditions hereof shall be binding upon either party hereto,
unless approved in writing by each such party. This letter agreement does not
supersede any existing secrecy or confidentiality agreements between or among
the parties.
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,
SPLASH TECHNOLOGY HOLDINGS, INC.
By: /s/ Xxxxx X. Xxxxxxxxxxxx
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Xxxxx X. Xxxxxxxxxxxx
President and Chief Executive Officer
Accepted and Agreed as of
the date first written above:
ELECTRONICS FOR IMAGING, INC.
By: /s/ Xxxxxx Xxxxx
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Xxxxxx Xxxxx
Chief Financial Officer
