EXHIBIT 2.2
INDEMNIFICATION AGREEMENT
THIS INDEMNIFICATION AGREEMENT ("AGREEMENT") is entered into as of
February 25, 1998, among Able Telcom Holding Corp., a Florida corporation
("ABLE"), Transportation Safety Contractors, Inc., a Florida corporation, and
Georgia Electric Company, Inc., a Georgia corporation (collectively, the
"BUYER"), COMSAT Corporation, a District of Columbia corporation ("COMSAT"), and
COMSAT RSI Acquisition, Inc., a Delaware corporation, doing business as COMSAT
RSI JEFA Wireless Systems, and an indirect wholly-owned subsidiary of COMSAT
(the "SELLER"). The Buyer, Able, COMSAT and Seller are referred to collectively
herein as the "Parties." All capitalized terms used herein but not otherwise
defined shall have the meaning ascribed to them as set forth in the Purchase
Agreement (defined below).
RECITALS
WHEREAS, the Parties have entered into that certain Asset Purchase
Agreement dated November 26, 1997 ("PURCHASE AGREEMENT") whereby Buyer agreed to
purchase substantially all of the assets (and assume certain of the liabilities)
of Seller;
WHEREAS, as a condition precedent to the Closing of the asset purchase,
the Buyer, Seller, COMSAT and Able agreed to give notices to third parties, and
use commercially reasonable efforts to obtain any third party consents,
authorizations, approvals of governments and governmental agencies that the
other reasonably may request; and
WHEREAS, the Parties have yet to obtain all the necessary consents but
the Buyer and Able do not wish to delay the Closing;
THEREFORE, for good and valuable consideration, the receipt of which is
hereby acknowledged, the Parties agree as follows.
AGREEMENT
1.01 INDEMNIFICATION. Buyer and Able, jointly and severally, shall indemnify
Seller and COMSAT from and against the entirety of any Adverse Consequences (as
defined in the Purchase Agreement) that Seller or COMSAT, as the case may be,
may suffer resulting from, arising out of, relating to in the nature of, or
caused by the failure to obtain all necessary consents pursuant to SECTION 5(B)
of the Purchase Agreement.
1.02 DETERMINATION OF DAMAGES AND OTHER MATTERS.
(a) The Indemnity Cap, defined in and pursuant to the Purchase Agreement,
shall not apply to any claim of indemnity made by Seller or COMSAT under this
Agreement.
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(b) Each Party hereby waives any claim for indirect, special or
consequential damages resulting from, arising out of, relating to, in the nature
of, or caused by a breach of this Agreement by any other Party.
(c) The amount which any party (an "INDEMNIFYING PARTY") is or may be
required to pay to any other party (an "INDEMNITEE") pursuant to this Agreement
shall be reduced (including, without limitation, retroactively) by any Insurance
Proceeds or other amounts actually recovered by or on behalf of such Indemnitee,
in reduction of the related Adverse Consequence. If an Indemnitee shall have
received payment (an "INDEMNITY PAYMENT") required by this Agreement from an
Indemnifying Party in respect of any Adverse Consequence and shall subsequently
actually receive Insurance Proceeds or other amounts in respect of such Adverse
Consequence, then such Indemnitee shall pay to such Indemnifying Party a sum
equal to the amount of such Insurance Proceeds or other amounts actually
received (up to but not in excess of the amount of the related Indemnity
Payment). An insurer who would otherwise be obligated to pay any claim shall not
be relieved of the responsibility with respect thereto, or, solely by virtue of
the indemnification provisions hereof, have any subrogation rights with respect
thereto, it being expressly understood and agreed that no insurer or any other
third party shall be entitled to a "windfall" (i.e., a benefit they would not be
entitled to receive in the absence of the indemnification provisions of this
Agreement) by virtue of the indemnification provisions hereof.
1.03 MATTERS INVOLVING THIRD PARTIES.
(a) If an Indemnitee shall receive notice or otherwise learn of the
assertion by a person (including, without limitation, any governmental entity)
who is not a party to this Agreement (or an Affiliate of either party) of a
claim or of the commencement by any such person of any Action with respect to
which an Indemnifying Party may be obligated to provide indemnification pursuant
to this Section (a "THIRD PARTY CLAIM"), such Indemnitee shall give such
Indemnifying Party written notice thereof promptly after becoming aware of such
Third Party Claim; provided that the failure of any Indemnitee to give notice as
provided in this SECTION 1.03 shall not relieve the Indemnifying Party of its
obligations hereunder, except to the extent that such Indemnifying Party is
actually prejudiced by such failure to give notice. Such notice shall describe
the Third Party Claim in reasonable detail.
(b) An Indemnifying Party may elect to defend or to seek to settle or
compromise, at such Indemnifying Party's own expense and with such Indemnifying
Party's own counsel, any Third Party Claim, as provided hereafter, so long as
the Indemnifying Party notifies the Indemnitee in writing within 30 days after
the Indemnitee has given notice of the Third Party Claim that the Indemnifying
Party will indemnify the Indemnitee from and against the entirety of any Adverse
Consequences the Indemnitee may suffer resulting from, arising out of, relating
to, in the nature of, or caused by the Third Party Claim (subject to the
limitations provided in SECTION 1.02). After notice from an Indemnifying Party
to an Indemnitee of its election to assume the defense of a Third Party Claim,
such Indemnifying Party shall not be liable to such Indemnitee under this
Agreement for any legal or other expenses (except expenses approved in advance
by the Indemnifying Party) subsequently incurred by such Indemnitee in
connection with the defense thereof; provided that if the defendants with
respect to any such Third Party Claim
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include both the Indemnifying Party and one or more Indemnitees and in any
Indemnitee's reasonable judgment a conflict of interest between one or more of
such Indemnitees and such Indemnifying Party exists in respect of such claim,
such Indemnitees shall have the right to employ separate counsel to represent
such Indemnitees and in that event the reasonable fees and expenses of such
separate counsel (but not more than one separate counsel reasonably satisfactory
to the Indemnifying Party) shall be paid by such Indemnifying Party. If an
Indemnifying Party elects not to assume responsibility for defending a Third
Party Claim, or fails to notify an Indemnitee of its election as provided in
this SECTION 1.03, such Indemnitee may defend or, subject to the remainder of
this SECTION 1.03, seek to compromise or settle such Third Party Claim without
prejudice to such Indemnitee's rights, if any, to continue to seek
indemnification hereunder. Notwithstanding the foregoing, neither an
Indemnifying Party nor an Indemnitee may settle or compromise any claim over the
objection of the other; provided, however, that consent to settlement or
compromise shall not be unreasonably withheld or delayed. Neither an
Indemnifying Party nor an Indemnitee shall consent to entry of any judgment or
enter into any settlement of any Third Party Claim which does not include as an
unconditional term thereof the giving by a claimant or plaintiff to such
Indemnitee, in the case of a consent or settlement by an Indemnifying Party, or
to the Indemnifying Party, in the case of a consent or settlement by an
Indemnitee, of a written release from all liability in respect to such Third
Party Claim.
(c) If an Indemnifying Party chooses to defend or to seek to compromise or
settle any Third Party Claim, the related Indemnitee shall make reasonably
available to such Indemnifying Party any personnel or any books, records or
other documents within its control or which it otherwise has the ability to make
available that are necessary or appropriate for such defense, settlement or
compromise of such Third Party Claims, subject to the establishment of
reasonably appropriate confidentiality arrangements and arrangements to preserve
any applicable privilege (including, the attorney-client privilege) and shall
cooperate in such defense, compromise or settlement. If an Indemnifying Party
chooses to defend or to seek to compromise or settle any Third Party Claim, the
related Indemnitee shall be entitled to attend and participate in any such
proceeding, discussion or negotiation at its own expense.
(d) Notwithstanding anything else in this Agreement to the contrary, if an
Indemnifying Party notifies the related Indemnitee in writing of such
Indemnifying Party's desire to settle or compromise a Third Party Claim on the
basis set forth in such notice (provided- that such settlement or compromise
includes as an unconditional term thereof the giving by the claimant or
plaintiff of a written release of the Indemnitee from all liability in respect
thereof and does not include any non-monetary remedy) and provides the
Indemnitee a copy of a written proposal of the applicable claimant to settle on
such terms, and the Indemnitee shall notify the Indemnifying Party in writing
that such Indemnitee declines to accept any such settlement or compromise, such
Indemnitee may continue to contest such Third Party Claim, free of any
participation by such Indemnifying Party, at such Indemnitee's sole expense. In
such event, the obligation of such Indemnifying Party to such Indemnitee with
respect to such Third Party Claim shall be equal to (i) the costs and expenses
of such Indemnitee prior to the date such Indemnifying Party notifies such
Indemnitee of the offer to settle or compromise (to the extent such costs and
expenses are otherwise indemnifiable hereunder) plus (ii) the lesser of (A) the
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amount of any offer of settlement or compromise which such Indemnitee declined
to accept and (B) the actual out-of-pocket amount such Indemnitee is obligated
to pay subsequent to such date as a result of such Indemnitee's continuing to
defend such Third Party Claim (including attorneys fees and expenses).
(e) Any claim on account of an Adverse Consequence which does not result
from a Third Party Claim shall be asserted by written notice given by the
Indemnitee to the related Indemnifying Party. Such Indemnifying Party shall have
a period of 30 days after the receipt of such notice within which to respond
thereto. If such Indemnifying Party does not respond within such 30-day period,
such Indemnifying Party shall be deemed to have refused to accept responsibility
to make payment.
(f) In addition to any adjustments required pursuant to Section 9(d), if
the amount of any Adverse Consequence shall, at any time subsequent to the
payment required by an Indemnifying Party on account thereof, be reduced by
recovery, settlement or otherwise, the amount of such reduction, less any
expenses incurred in connection therewith, shall promptly be repaid by the
Indemnitee to the Indemnifying Party.
(g) In the event of payment by an Indemnifying Party to any Indemnitee in
connection with any Third Party Claim, such Indemnifying Party shall be
subrogated to and shall stand in the place and the place of such Indemnitee as
to any events or circumstances in respect of which such Indemnitee may have any
right or claim relating to such Third Party Claim against any claimant or
plaintiff asserting such Third Party Claim or against any other person. Such
Indemnitee shall cooperate with such Indemnifying Party in a reasonable manner,
and at the cost and expense of such Indemnifying Party, in prosecuting any
subrogated right or claim.
1.04 OTHER INDEMNIFICATION PROVISIONS. The foregoing indemnification provisions
are in addition to, and not in derogation of, any statutory, equitable, or
common law remedy (including without limitation any such remedy arising under
Environmental, Health, and Safety Requirements) any Party may have pursuant to
this Agreement and with respect to the transactions contemplated by the Purchase
Agreement.
2.01 MISCELLANEOUS.
(a) No Third-Party Beneficiaries. This Agreement shall not confer any
rights or remedies upon any Person other than the Parties and their respective
successors and permitted assigns.
(b) Entire Agreement. This Agreement (including the documents referred to
herein) constitutes the entire agreement between the Parties and supersedes any
prior understandings, agreements, or representations by or between the Parties,
written or oral, to the extent they related in any way to the subject matter
hereof.
(c) Succession and Assignment. This Agreement shall be binding upon and
inure to the benefit of the Parties named herein and their respective successors
and permitted assigns. No
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Party may assign either this Agreement or any of its rights, interests, or
obligations hereunder without the prior written approval of the other Party;
provided, however, that Buyer may (i) assign any or all of its rights and
interests hereunder to one or more of its Affiliates and (ii) designate one or
more of its Affiliates to perform its obligations hereunder (in any or all of
which cases Buyer nonetheless shall remain responsible for the performance of
all of its obligations hereunder).
(d) Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original but all of which
together will constitute one and the same instrument.
(e) Headings. The section headings contained in this Agreement are
inserted for convenience only and shall not affect in any way the meaning or
interpretation of this Agreement.
(f) Notices. All notices, requests, demands, claims, and other
communications hereunder will be in writing. Any notice, request, demand, claim,
or other communication hereunder shall be deemed duly given if (and then two
business days after) it is sent by registered or certified mail, return receipt
requested, postage prepaid, and addressed to the intended recipient as set forth
below:
to Seller:
COMSAT RSI Jefa Wireless Systems
c/o COMSAT Corporation
(at the address and with the copies set forth below with respect
to COMSAT)
to COMSAT:
COMSAT Corporation
0000 Xxxx Xxxxxx Xxxxx
Xxxxxxxx, Xxxxxxxx 00000
Attention: Xxxxx X. Flower
Vice President and Chief Financial Officer
Telecopy No.: (000) 000-0000
With copy (which shall not constitute notice) to:
Xxxxxx X. Xxxxx
Vice President, General Counsel and Secretary
COMSAT Corporation
0000 Xxxx Xxxxxx Xxxxx
Xxxxxxxx, Xxxxxxxx 00000
Telecopy No.: (000) 000-0000
and copy (which shall not constitute notice) to:
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Xxxxxxx X. Xxxxxx
Xxxxxx Xxxxx, L.L.P.
0000 Xxxx Xxxxxx, Xxxxx 000
Xxxxxx, Xxxxx 00000
Telecopy No.: (000) 000-0000
If to Buyer or Able:
Transportation Safety Contractors, Inc.
c/o Able Telcom Holding Corp.
0000 Xxxxx Xxxxx, Xxxxx 0000
Xxxx Xxxx Xxxxx, XX 00000
Attention: President
Telecopy No.: (000) 000-0000
and copy (which shall not constitute notice) to:
Xxxxx X. Xxxxx, Xx.
Holland & Knight L.L.P.
000 Xxxxx Xxxxxxx Xxxxx, Xxxxx 000
Xxxx Xxxx Xxxxx, XX 00000
Telecopy No.: (000) 000-0000
Any Party may send any notice, request, demand, claim, or other
communication hereunder to the intended recipient at the address set forth above
using any other means (including personal delivery, expedited courier, messenger
service, telecopy, telex, ordinary mail, or electronic mail), but no such
notice, request, demand, claim, or other communication shall be deemed to have
been duly given unless and until it actually is received by the intended
recipient. Any Party may change the address to which notices, requests, demands,
claims, and other communications hereunder are to be delivered by giving the
other Party notice in the manner herein set forth.
(g) Governing Law. This Agreement shall be governed by and construed in
accordance with the domestic laws of the State of Texas without giving effect to
any choice or conflict of law provision or rule (whether of the State of Texas
or any other jurisdiction) that would cause the application of the laws of any
jurisdiction other than the State of Texas.
(h) Amendments and Waivers. No amendment of any provision of this
Agreement shall be valid unless the same shall be in writing and signed by Buyer
and Seller. No waiver by any Party of any default, misrepresentation, or breach
of warranty or covenant hereunder, whether intentional or not, shall be deemed
to extend to any prior or subsequent default, misrepresentation, or breach of
warranty or covenant hereunder or affect in any way any rights arising by virtue
of any prior or subsequent such occurrence.
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(i) Severability. Any term or provision of this Agreement that is invalid
or unenforceable in any situation in any jurisdiction shall not affect the
validity or enforceability of the remaining terms and provisions hereof or the
validity or enforceability of the offending term or provision in any other
situation or in any other jurisdiction.
(j) Construction. Any reference to any federal, state, local, or foreign
statute or law shall be deemed also to refer to all rules and regulations
promulgated thereunder, unless the context requires otherwise. The word
'including' shall mean including without limitation.
(k) Submission to Jurisdiction. Each of the Parties submits to the
jurisdiction of any state or federal court sitting in Dallas County, Texas. in
any action or proceeding arising out of or relating to this Agreement and agrees
that all claims in respect of the action or proceeding may be heard and
determined in any such court. Each Party also agrees not to bring any action or
proceeding arising out of or relating to this Agreement in any other court. Each
of the Parties waives any defense of inconvenient forum to the maintenance of
any action or proceeding so brought and waives any bond, surety, or other
security that might be required of any other Party with respect thereto. Any
Party may make service on the other Party by sending or delivering a copy of the
process to the Party to be served at the address and in the manner provided for
the giving of notices in SECTION 2.01(F) above. Each Party agrees that a final
judgment in any action or proceeding so brought shall be conclusive and may be
enforced by suit on the judgment or in any other manner provided by law or in
equity.
(REMAINDER OF PAGE INTENTIONALLY BLANK)
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IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as of
the date first above written.
TRANSPORTATION SAFETY CONTRACTORS, INC.
By: /s/
-----------------------------------
Xxxxx X. Xxxx
Executive Vice President
GEORGIA ELECTRIC COMPANY, INC.
By: /s/
-----------------------------------
Xxxxx X. Xxxx
President
ABLE TELCOM HOLDING CORP.
By: /s/
-----------------------------------
Xxxxx X. Xxxx
President and Chief
Executive Officer
COMSAT RSI Acquisition, Inc., d.b.a.
COMSAT RSI JEFA Wireless Systems
By: /s/
-----------------------------------
Xxxxxx Xxxxxxxxx
Vice President and
General Manager
COMSAT CORPORATION
By: /s/
-----------------------------------
Xxxxx X. Flower
Vice President and Chief
Financial Officer
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