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EXHIBIT 7
[National-Standard Letterhead]
February 18, 2000
Mr. Michael E. Heisley
Chief Executive Officer
Heico Acquisitions
5600 Three First National Plaza
Chicago, Illinois 60602
Dear Mr. Heisley:
In connection with your consideration of a possible negotiated
transaction with National-Standard Company and its subsidiaries (the
"Company"), the Company is prepared to make available certain information
concerning its business, financial condition, operations, assets and
liabilities (the "Evaluation Material"). As a condition to the Evaluation
Material being furnished to you and to your directors, officers, employees,
agents or advisors (including attorneys, accountants, consultants, bankers
and financial advisors) (collectively the "Representatives"), you agree to
treat the Evaluation Material in accordance with the provisions of this
letter agreement and to take or abstain from taking certain other actions as
set forth below.
The term "Evaluation Material" shall also include all notes,
analyses, compilations, studies, interpretations or other documents prepared
by you or your Representatives which contain, reflect or are based upon, in
whole or in part, the information furnished to you or to your Representatives
pursuant to this agreement. The term "Evaluation Material" does not include
information which (i) is or becomes generally available to the public other
than as a result of a disclosure by you or your Representatives, (ii) was
within your possession prior to its being furnished to you by or on behalf of
the Company pursuant hereto, provided that the source of such information was
not known by you to be bound by either a confidentiality agreement with, or
other contractual, legal or fiduciary obligation of confidentiality to, the
Company, or, (iii) becomes available to you on a non-confidential basis from
a source other than the Company or any of its Representatives, provided that
such source is not bound by a confidentiality agreement with, or other
contractual, legal or fiduciary obligation of confidentiality to, the Company.
You hereby agree that you and your Representatives shall use the
Evaluation Material solely for the purpose of evaluating a possible
negotiated transaction between the Company and Heico Acquisitions, that the
Evaluation Material will be kept confidential and that you and your
Representatives will not disclose any of the Evaluation Material in any
manner; provided, however, that (i) you may make any disclosure of such
information to which the Company gives its prior written consent and (ii) any
of such information may be disclosed to your Representatives who need to know
such information for the sole purpose of evaluating a possible negotiated
transaction with the Company, who agree to keep such information confidential
(and who are provided with a copy of this letter agreement and agree to be
bound by its terms). In any event, you shall be responsible for any breach of
this letter agreement by any of your
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Representatives and you agree, at your sole expense, to take all reasonable
measures (including but not limited to court proceedings) to restrain your
Representatives from prohibited or unauthorized disclosure or use of the
Evaluation Material.
In addition, you agree that, without the prior written consent of
the Company, you and your Representatives will not disclose to any other
person the fact that the Evaluation Material has been made available to you,
that discussions or negotiations are taking place concerning a possible
transaction involving the Company, or, any of the terms, conditions or other
facts with respect thereto (including the status thereof). However, you may
make such disclosure if you have received the written opinion of your outside
counsel that such disclosure must be made by you in order that you not commit
a violation of law. The term "person" as used in this letter agreement shall
be broadly interpreted to include the media and any corporation, partnership,
group, individual or other entity.
In the event that you or your Representatives are requested or
required to disclose any of the Evaluation Material, you shall provide the
Company with prompt written notice of any such request or requirement so that
the Company 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
the Company, you or your Representatives are nonetheless, in the written
opinion of your outside counsel, legally compelled to disclose Evaluation
Material to any tribunal or else stand liable for contempt or suffer other
censure or penalty, you or your Representative may, without liability
hereunder, disclose to such tribunal only that portion of the Evaluation
Material which such counsel advises you is legally required to be disclosed,
provided that you exercise all reasonable efforts to preserve the
confidentiality of the Evaluation Material, including, without limitation, by
cooperating with the Company to obtain an appropriate protective order or
other reliable assurance that confidential treatment will be accorded the
Evaluation Material by such tribunal.
If you decide that you do not wish to proceed with a transaction
with the Company, you will promptly inform the Company of that decision. In
that case, or at any time upon the request of the Company for any reason, you
will promptly deliver to the Company all Evaluation Material (and all copies
thereof), or in lieu of delivery to the Company you will destroy such
Evaluation Material, furnished to you or your Representatives by or on behalf
of the Company pursuant hereto. In the event of such a decision or request,
all other Evaluation Material prepared by you or your Representatives shall
be destroyed and no copy thereof shall be retained. Notwithstanding the
return or destruction of the Evaluation Material, you and your
Representatives will continue to be bound by your obligations of
confidentiality and other obligations hereunder.
You understand and acknowledge that neither the Company nor any of
its Representatives (including its investment banker, if any) or any of the
Company's directors, officers, or employees makes any representation or
warranty, express or implied, as to the accuracy or completeness of the
Evaluation Material. You agree that neither the Company nor any of its
Representatives (including its investment banker, if any) shall have any
liability to you or to any of your Representatives relating to or resulting
from the use of the Evaluation Material or any errors therein or omissions
therefrom. Only those representations or warranties which are made in a final
definitive agreement regarding any transactions contemplated hereby, when, as
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and if executed, and subject to such limitations and restrictions as may be
specified therein, will have any legal effect.
In consideration of the Evaluation Material being furnished to you,
you hereby agree that for a period of one year from the date hereof, neither
you nor any of your "affiliates" (as such word is defined under the
Securities Exchange Act of 1934, as amended), will directly solicit the
employment of the current officers or employees of the Company without
obtaining the prior written consent of the Company.
You further agree that, for a period of one year from the date of
this agreement, unless such shall have been specifically invited in writing
by the Company and other than a purchase by you and your affiliates of up to
10% of any class of outstanding securities of the Company, neither you nor
any of your "affiliates" (as such word is defined under the Securities
Exchange Act of 1934, as amended) or Representatives will in any manner (a)
effect or seek, offer or propose (publicly or otherwise) to effect, or cause
or participate in or in any way assist any other person in: (i) any
acquisition of any securities (or beneficial ownership thereof) or assets of
the Company or any of its subsidiaries; (ii) any tender or exchange offer,
merger or other business combination involving the Company or any of its
subsidiaries; (iii) any recapitalization, restructuring, liquidation,
dissolution or other extraordinary transaction with respect to the Company or
any of its subsidiaries; or (iv) any "solicitation" of "proxies" (as such
terms are used in the proxy rules of the Securities and Exchange Commission)
or consents to vote any voting securities of the Company, or communications
referred to in Rules 14a-1(e)(iv) or 14a-2(b) of such proxy rules and
relating to the Company or its securities; (b) form, join or in any way
participate in a "group" or act in concert with any other person or entity or
otherwise become a "person" (both as defined under Section 13(d) of the 1934
Act) with respect to any voting securities of the Company; (c) otherwise act,
alone or in concert with others, to seek to control or influence the
management, Board of Directors or policies of the Company; (d) take any
action which might force the Company to make a public announcement regarding
any of the types of matters set forth in (a) above; or (e) enter into any
discussions or arrangements with any third party with respect to any of the
foregoing. This paragraph shall not foreclose you from making an offer or
proposal directly to the Company and shall be inapplicable in the event that
a third party not affiliated with you (or any other party with whom you are
acting in concert, directly or indirectly), manifests a bona-fide intention
to acquire all or any substantial portion of the Company's assets or
securities or otherwise seeks to obtain control of the Company.
You understand and agree that no contract or agreement providing for
any transaction involving the Company shall be deemed to exist between you
and the Company unless and until a final definitive agreement has been
executed and delivered, and you hereby waive, in advance, any claims
(including, without limitation, breach of contract) in connection with any
transaction involving the Company unless and until you and the Company shall
have entered into a final definitive agreement.
You also agree that unless and until a final definitive agreement
regarding a transaction between the Company and you has been executed and
delivered, neither the Company nor you 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. You
further acknowledge and agree that the Company reserves the right, in its
sole discretion, to reject any
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and all proposals made by you or any of your Representatives with regard to a
transaction between the Company and you, and to terminate discussions and
negotiations with you at any time.
You further understand that (i) the Company and its Representatives
shall be free to conduct any process for any transaction involving the
Company, as they in their sole discretion shall determine (including
negotiating with any other interested parties and entering into a definitive
agreement without prior notice to you or any other person), (ii) any
procedures relating to such process or transaction may be changed at any time
without notice to you or any other person, and (iii) you shall not have any
claims whatsoever against the Company, its Representatives or any of their
respective directors, officers, stockholders, owners, affiliates or agents
arising out of or relating to any transaction involving the Company (other
than those as against the parties to a definitive agreement with you in
accordance with the terms thereof); nor, unless a definitive agreement is
entered into with you, against any third party with whom a transaction is
entered into.
Neither the foregoing paragraph nor any other provision in this
agreement can be waived or amended except by written consent of the Company,
which consent shall specifically refer to the paragraph (or such provision)
and explicitly make such waiver or amendment.
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 future exercise thereof or the exercise of any other right, power or
privilege hereunder.
It is further understood and agreed that money damages alone would
not be a sufficient remedy for any breach of this letter agreement by you or
any of your Representatives and that the Company 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 by you of this letter agreement but shall be in
addition to all other remedies available at law or equity to the Company. In
the event of litigation relating to this letter agreement, if a court of
competent jurisdiction determines that you or any of your Representatives
have breached this letter agreement, then you shall be liable and pay to the
Company the reasonable legal fees incurred by the Company in connection with
such litigation, including any appeal therefrom.
This letter agreement is for the benefit of the Company, its
investment banker, if any, and their directors, officers, stockholders,
owners, affiliates, and agents, and shall be governed by and construed in
accordance with the internal laws of the State of Indiana applicable to
agreements made and to be performed therein. You also hereby irrevocably and
unconditionally consent to submit to the exclusive jurisdiction of the courts
of the United States of America located in the States of Indiana or Illinois
for any actions, suits or proceedings arising out of or relating to this
agreement and the transactions contemplated hereby (and you agree not to
commence any action, suit or proceeding relating thereto except in such
courts), and further agree that service of any process, summons, notice or
document by U.S. registered mail to your address set forth above shall be
effective service of process for any action, suit or proceeding brought
against you in any such court. You hereby irrevocably and unconditionally
waive any
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objection to the laying of venue of any action, suit or proceeding arising
out of this agreement or the transactions contemplated hereby, in the courts
of the United States of America located in the States of Indiana or Illinois,
and hereby further irrevocably and unconditionally waive and agree not to
plead or claim in any such court that any such action, suit or proceeding
brought in any such court has been brought in an inconvenient forum.
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,
/s/ Ronald B. Kalich
Ronald B. Kalich
President & Chief Executive Officer
Accepted and Agreed:
Heico Acquisitions
By: /s/ Thomas H. Pearson
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Its: Managing Director
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