Confidentiality Agreement

 

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                               JARDEN CORPORATION

                            555 Theodore Fremd Avenue

                               Rye, New York 10580

 

 

 

 

 

 

                                                                 January 9, 2004

 

 

 

 

The Board of Directors

Dixon Ticonderoga Company

195 International Parkway

Heathrow

FL 32746

 

Attention: Gino N. Pala

 

Dear Sirs:

 

     In order to induce Jarden Corporation, a Delaware corporation ("Buyer"), to

commit the resources, forego other potential opportunities, and incur the legal,

accounting and other incidental expenses necessary to properly evaluate a

potential transaction (the "Transaction") among the Buyer, a wholly owned

subsidiary of Buyer to be formed ("Newco"), and Dixon Ticonderoga Company, a

Delaware corporation (the "Company") in which Buyer and/or Newco would acquire

all of the issued and outstanding shares of common stock (the "Shares") of the

Company, and to negotiate the terms of definitive documentation with respect

thereto, the Company and the Buyer agree that:

 

     1. Public Disclosure. Notwithstanding anything to the contrary herein

(other than as provided in the last sentence of this Section 1) or in the

Confidentiality Agreement (defined below), promptly after the execution of this

letter agreement, the Company will make public disclosure of this letter

agreement in a form and manner mutually agreed upon by the parties. Except as

otherwise provided herein, neither the Company nor Buyer (subject to

requirements of law) shall make any disclosure to any other person or make any

public announcement regarding the Transaction or the matters disclosed by any

party to the other in connection with the Transaction without the prior written

approval of both the Company and Buyer. Nothing in this letter agreement or the

Confidentiality Agreement shall preclude the

 

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The Board of Directors

Dixon Ticonderoga Company

Page 2

 

 

Buyer or the Company from making any public announcement required, in the

reasonable opinion of their respective counsel, in connection with any federal

or state securities laws, rules or regulations, including the rules of a

national securities exchange.

 

     2. Exclusivity. Pursuant to this letter agreement and subject to Section 3

hereof, the Buyer shall have the exclusive right to negotiate with the Company

on the terms and conditions of, and definitive documentation for, the

Transaction, which right shall expire on the earlier of (i) February 10, 2004,

at 5:00 p.m. or, in the event such date is extended by the mutual written

agreement of the Buyer and the Company, such later date, (ii) the execution by

Buyer, Newco and the Company of a definitive merger agreement providing for the

merger of the Company with and into Newco, or (iii) the time at which the

discussions and negotiations with respect to the possible acquisition of the

Shares have been finally terminated by the Buyer (the "Termination Date").

 

     3. Nonsolicitation. Prior to any Termination Date, the Company will not,

nor will the Company permit any of its subsidiaries to, nor will the Company

authorize or permit any of its directors, officers, employees, representatives,

agents, or affiliates, including any investment banker, advisor, attorney or

accountant retained or formerly retained by it or any of its subsidiaries

("Representatives") to directly or indirectly through another person, (i)

solicit, initiate, resume, or encourage (including by way of furnishing or

disclosing non-public information), or take any other action to facilitate, any

inquiries or the making of any proposal that constitutes, or may reasonably be

expected to lead to, any Takeover Proposal (as defined below), (ii) participate

in any discussions or negotiations regarding any Takeover Proposal, or (iii)

enter into any Acquisition Agreement (as defined below); provided, that if the

Company's board of directors determines in its good faith business judgment,

after consultation with outside legal counsel, that the failure to furnish such

information or to participate in such discussions or such negotiations is

reasonably likely to result in a breach of the directors' fiduciary duties to

the Company's stockholders under applicable law, then the Company and its

Representatives may, in response to a Takeover Proposal that was not solicited

by the Company after the date of this letter agreement and that did not

otherwise arise out of a breach of this letter agreement, and subject to the

Company's compliance with the terms of this letter agreement and providing Buyer

with at least two days' prior written notice of its decision to take such action

(including, subject to consent of the person making such Takeover Proposal,

specifying the material terms of such Takeover Proposal and the identity of the

person making such Takeover Proposal), (x) furnish information with respect to

the Company and its subsidiaries to any person makin