Exhibit 99.2
CLOSING AGREEMENT
This Agreement (the "Closing Agreement") is entered into as of October 31,
1997 among CACI International Inc, a Delaware corporation ("CACI"), CACI,
Inc., a Delaware corporation and a wholly-owned subsidiary of CACI ("CASub"),
and Infonet Services Corporation, a Delaware corporation ("Infonet").
RECITALS
WHEREAS, pursuant to an Acquisition Agreement of even date herewith (the
"Acquisition Agreement") among CACI, CASub and Government Systems, Inc., a
Delaware corporation ("GSI"), CACI is acquiring certain assets and assuming
certain liabilities of GSI;
WHEREAS, GSI is a wholly owned subsidiary of Infonet; and
WHEREAS, it is a condition to the obligations of CACI and CASub under the
Acquisition Agreement that CACI, CASub and Infonet enter into this Closing
Agreement.
AGREEMENT
NOW, THEREFORE, in consideration of the above premises, the mutual promises
and covenants set forth below, and other good and valuable consideration, the
receipt of which is hereby acknowledged, CACI, CASub and Infonet agree as
follows:
1. Performance of Obligations. Infonet shall cause GSI fully and
faithfully to perform each and all of GSI' s covenants contained in the
Acquisition Agreement.
2. Non-Competition Agreement. For a period of three years after the
Closing Date, neither Infonet nor any of its Subsidiaries, without CACI's
prior written consent, shall participate, directly or indirectly, as owner,
stockholder, manager, partner, agent, consultant, representative or otherwise
in assisting any business, firm or corporation in the provision of Competing
Services. For purposes of this Section 2, "Competing Services" shall mean (i)
contesting or seeking to overturn any of the Assigned Contracts and (ii)
providing network configuration management, network optimization, simulation
and modeling or technology insertion analysis services to any system
integrator which is competing against CACI for a CACI Desired Contract. "CACI
Desired Contract" shall mean a contract or assignment from any branch or
agency of the United States or any state or local government in the United
States for which CACI shall have notified Infonet in advance CACI intends to
compete and for which CACI actually is in competition. Notwithstanding the
foregoing, the provisions of this Section 2 shall not bind in any way any
stockholder of Infonet and shall not limit Infonet in the sale of its standard
commercial products or services in any way.
3. Executive Retention. CACI has entered into agreements with certain
persons who were employees of GSI immediately before the Closing, providing
for their employment after the closing by CACI, CASub, or one or more other
subsidiaries of CACI, and further providing for certain payments to the
employees as additional compensation for remaining in CACI's employ for
specified periods after the Closing. In order to fund CACI's obligation to
make those additional payments, Infonet shall cause GSI to pay to CACI at
Closing the sum of One Million One Hundred Thousand Dollars ($1,100,000) (the
"Payment") by wire transfer of immediately available funds to an account
specified by CACI. This payment obligation shall be Infonet's and GSI's sole
responsibility to CACI in connection with such employees. In the event that
CACI terminates any such employee for "cause", as that term is defined in the
employment agreement between CACI and such employee, CACI hereby agrees to
repay to Infonet any portion (or all, if applicable) of the Payment allocable
to that employee which has not been actually paid to such employee pursuant to
such agreements. CACI shall make such repayment to Infonet by wire transfer
of immediately available funds within ten days after the effective date of the
employee's termination.
4. Intellectual Property. Infonet is concurrently granting to CACI
intellectual property rights as set forth in the "Assignment of Intellectual
Property" and the "Assignment of Third-Party Intellectual Property" delivered
in connection with the Closing.
5. Use of Names. For a period of 180 days following after the Closing
Date, CACI and CASub shall be permitted to use the names "Infonet Services
Corporation" and "Government Systems, Inc." or variations thereof solely for
the purpose of identifying themselves as the acquirors of GSI's business.
6. Assignment of Infonet contracts. The parties agree that the business of
GSI being acquired by CACI includes the contracts identified in Schedule A
attached hereto, as to which Infonet is the contracting party. Infonet has
assigned those contracts to CASub in the manner provided in the Acquisition
Agreement with respect to GSI contracts; and Infonet hereby undertakes to
pursue Government approval of assignment or novation of those contracts in the
manner and to the extent provided in the Acquisition Agreement with respect to
GSI contracts.
7. Indemnification. Subject to the limitations set forth in this Closing
Agreement, Infonet shall indemnify and hold harmless CACI and CASub and their
respective successors by merger or other operation of law (the "Successors"),
directors and officers from and against all losses, liabilities, claims,
damages, costs or expenses (including, without limitation, reasonable expenses
of investigation and reasonable attorneys' fees and disbursements) suffered,
incurred or paid:
a. that would not have been suffered, incurred or paid if all the
representations, warranties, covenants and agreements of GSI in the
Acquisition Agreement or in any other instrument or document described in
Section 5.2 of the Acquisition Agreement had been (with respect to representatio
ns and warranties) true and had been (with respect to covenants and
agreements) fully performed and fulfilled;
b. under the Worker Adjustment and Retraining Notification Act of 1988
("WARN") or similar law as the result of any "plant closing" or "mass layoff,"
within the meaning of WARN, that occurs at or prior to Closing;
c. as a result of any Action arising out of or relating to the conduct
of the business of GSI before or after the Closing or any liability or
obligation, or alleged liability, of GSI not specifically assumed by CACI
under this Closing Agreement; and
d. as a result of any Action which arises out of or relates to the
failure of GSI to pay, promptly and when due, any tax, fee or other charge
which shall become due or shall have accrued on account of the use,
acquisition or ownership of GSI of any of the Assets or any tax, fee or other
charge GSI is obligated to pay, or to reimburse CACI or CASub for, hereunder
on account of any sale of the Assets or the transactions contemplated hereby.
Notwithstanding anything herein to the contrary, if Infonet and/or GSI shall
be required to indemnify CACI, CASub or any of their Subsidiaries or any of
their respective directors, officers or Successors with respect to the same
item of damage and amount, the satisfaction of such indemnity to one of them
by either Infonet or GSI shall discharge Infonet's obligations to the other to
the extent of the amount paid.
8. Conditions. The obligations and liabilities of Infonet to a person or
entity seeking indemnification (an "Indemnified Party") under this Closing
Agreement with respect to claims resulting from the assertion of liability by
third parties shall be subject to the following conditions:
a. The Indemnified Party shall give written notice to Infonet of the
nature of the assertion of liability by a third party and the amount thereof
promptly after the Indemnified Party learns of such assertion. The
Indemnified Party also shall give written notice to Infonet of any assertion
of liability made by it against GSI and shall provide Infonet with a copy of
such assertion. The foregoing notwithstanding, failure of an Indemnified
Party to comply with its obligations under this Section 8 shall affect its
right to indemnity only to the extent Infonet demonstrates actual damage
caused by such failure.
b. If any Action is brought by a third party against an Indemnified
Party, the Action shall be defended by Infonet and such defense shall include
all appeals or reviews which counsel for Infonet shall deem appropriate.
Until Infonet shall have assumed the defense of any such Action, or if the
Indemnified Party shall have reasonably concluded that there are likely to be
defenses available to the Indemnified Party that are different from or in
addition to those available to Infonet (in which case Infonet shall not be
entitled to assume the defense of such Action), all legal or other expenses
reasonably incurred by the Indemnified Party shall be borne by Infonet and
shall be repaid to Infonet by the Indemnified Party if it is finally
determined that Infonet was not liable or responsible for the claim underlying
the Action.
c. In any Action initiated by a third party and defended by Infonet,
(i) the Indemnified Party shall have the right to be represented by advisory
counsel and accountants, at its own expense, (ii) Infonet shall keep the
Indemnified Party fully informed as to the status of such Action at all stages
thereof, whether or not the Indemnified Party is represented by its own
counsel, (iii) the Indemnified Party shall make available to Infonet, and its
attorneys and accountants, all books and records of the Indemnified Party
relating to such Action, and (iv) the parties shall render to each other such
assistance (including, without limitation, as contemplated by Section 4.6 of
the Acquisition Agreement) as may be reasonably required for the proper and
adequate defense of such Action.
d. In any Action initiated by a third party and defended by Infonet,
Infonet shall not make any settlement of any claim without the written consent
of the Indemnified Party, which consent shall not be unreasonably withheld or
delayed. Without limiting the generality of the foregoing, it shall not be
deemed unreasonable to withhold consent to a settlement involving injunctive
or other equitable relief against the Indemnified Party or its assets,
employees or business.
9. Claims. If a claim is to be made by a party pursuant to Section 7 or 8
hereunder against Infonet, the claiming party shall give written notice (a
"Claim Notice") to Infonet as soon as practicable after the claiming party
becomes aware of any fact, condition or event which may give rise to a claim
for which indemnification may be sought under this Closing Agreement. Each
Indemnified Party shall use its reasonable commercial efforts not to assert
duplicative claims against Infonet and GSI and to keep each of Infonet and GSI
fully informed about claims made by such Indemnified Party against the other
(and the progress and resolution of such claims).
10. Limitation of Liability. Notwithstanding anything herein to the
contrary, Infonet shall not be liable to CACI or CASub in connection with this
Closing Agreement or the transactions contemplated by the Acquisition
Agreement for any indemnification or other form of obligation (i) unless (A)
the claim is ripe, (B) the Claim Notice delivered in connection with such
claim describes an actual occurrence giving rise to such claim and (C) the
Claim Notice is received by the party from which indemnification is sought on
or before June 30, 2000 and (ii) unless and until the aggregate amount of
liability for any reason exceeds $25,000 (provided that thereafter Infonet
shall make indemnification thereunder for the aggregate amount of such
liability, including, without limitation, such $25,000). The total amount of
Infonet's and GSI's obligation to indemnify or otherwise pay CACI, CASub or
any other person or entity for any reason in connection with this Closing
Agreement or the transactions contemplated by the Acquisition Agreement shall
not exceed, in aggregate, the Purchase Price. CACI hereby agrees immediately
to reimburse Infonet upon Infonet's demand if and when CACI, CASub, or any
other Indemnified Party receives indemnification or payment in excess of the
Purchase Price from Infonet and GSI pursuant to his Closing Agreement and/or
the Acquisition Agreement.
11. Representations and Warranties of Infonet. Infonet is a corporation
duly organized, validly existing and in good standing under the laws of
Delaware. Infonet has the full corporate power to execute, deliver, and
perform this Closing Agreement and to carry out its obligations hereunder.
The execution, delivery and performance of this Closing Agreement have been
duly and validly authorized by the Board of Directors of Infonet, and no other
corporate proceedings on the part of Infonet remain necessary to authorize the
execution, delivery and performance of this Closing Agreement. This Closing
Agreement has been duly executed and delivered by Infonet and is the legal,
valid and binding obligation of Infonet, enforceable against Infonet in
accordance with its terms except as enforceability may be limited by
bankruptcy, insolvency, reorganization or other laws affecting generally the
enforcement of creditors' rights and except to the extent that courts may
award money damages rather than specific performance of contractual
provisions.
12. Miscellaneous. Capitalized terms used, but not defined, herein shall
have the respective meanings ascribed to such terms in the Acquisition Agreement
. All notices and other communications hereunder shall be in writing and
shall be given in the manner set forth in Section 6.6 of the Acquisition
Agreement. This Closing Agreement may be executed in one or more
counterparts, all of which together shall constitute one and the same Closing
Agreement. This Closing Agreement shall be governed by and construed in
accordance with the laws of the Commonwealth of Virginia.
INFONET SERVICES CORPORATION
By /s/
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Name:
Title:
CACI INTERNATIONAL INC
By /s/
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Name:
Title:
CACI, INC.
By /s/
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Name:
Title:
