EXHIBIT 10.12
INDEMNIFICATION AGREEMENT
This Indemnification Agreement (the "Agreement") is made
and entered into this 13th day of March, 1996 by and between Shared
Technologies Inc. ("Shared Technologies"), a Delaware corporation,
and ▇▇▇▇▇▇▇▇▇ Holding Corp. ("FHC"), a Delaware corporation.
W I T N E S S E T H :
WHEREAS, Shared Technologies, The ▇▇▇▇▇▇▇▇▇ Corporation,
RHI Holdings Inc. and Fairchild Industries, Inc. ("Fairchild") have
entered into an Agreement and Plan of Merger (the "Merger
Agreement") dated as of November 9, 1995, as amended; and
WHEREAS, FHC owns the assets and liabilities, and conducts the
operations, of the aerospace and industrial fasteners business previously owned
and conducted by Fairchild and its subsidiaries; and
WHEREAS, capitalized terms used herein without definition
shall have the respective meanings ascribed to such terms in the Merger
Agreement; and
WHEREAS, the execution and delivery of this Agreement is a
condition to effecting the Merger at the Closing and the parties to the Merger
Agreement have agreed to effect the Merger in reliance upon the execution and
delivery of this Agreement;
NOW, THEREFORE, in consideration of the transactions
contemplated by the Merger Agreement and other good and valuable consideration
the receipt and sufficiency of which are hereby acknowledged, the parties
hereto, intending to be legally bound hereby, agree as follows:
1. Indemnification by FHC.
FHC hereby agrees to indemnify and hold harmless Shared
Technologies against any and all losses, liabilities and damages or actions or
claims (or actions or proceedings whether commenced or threatened) in respect
thereof (hereinafter referred to collectively as "Losses") resulting from any
liability or claims (including without limitation counsel fees and expenses for
Shared Technologies in the event FHC fails to assume the defense thereof) which
related to the aerospace and industrial fasteners business as previously owned
and conducted by Fairchild and its subsidiaries prior to the Effective Time,
including without limitation those which have directly and indirectly been
assumed by FHC pursuant to
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the Fairchild Reorganization described in Schedule 9.1 to the Merger Agreement
and including all Taxes (including but not limited to Taxes related to the
Fairchild Reorganization). Notwithstanding the foregoing, in no event shall
Shared Technologies be entitled to indemnification for, and the term "Losses"
shall not include, any consequential damages or damages which are speculative,
remote or conjectural (except to the extent represented by a successful claim by
a third party).
If any action, proceeding or claim shall be brought or
asserted against Shared Technologies by any third party, which action,
proceeding or claim, if determined adversely to the interests of Shared
Technologies would entitle Shared Technologies to indemnity pursuant to this
Agreement, Shared Technologies shall promptly, but in no event later than 10
days from the date Shared Technologies receives written notice of such action,
proceeding or claim, notify FHC of the same in writing specifying in detail the
basis of such claim and the facts pertaining thereto (but the failure to give
such notice in a timely fashion shall not affect FHC' obligations under this
Section 1 except to the extent it prejudiced or damaged FHC' ability to defend,
settle or compromise such claim or to pay any Losses resulting therefrom), and
FHC shall be entitled (but not obligated) to assume the defense thereof by
giving written notice thereof within 10 days after FHC received notice of the
claim from Shared Technologies to Shared Technologies and have the sole control
of defense and settlement thereof (but only, with respect to any settlement, if
such settlement involves an unconditional release of Shared Technologies or any
of its subsidiaries), including the employment of counsel and the payment of all
expenses.
2. Indemnification by Shared Technologies.
Shared Technologies hereby agrees to indemnify and hold
harmless FHC against any and all losses, liabilities and damages or actions or
claims (or actions or proceedings whether commenced or threatened) in respect
thereof (hereinafter referred to collectively as "STI Losses") resulting from
(x) losses related to or arising out of the telecommunications systems and
service business of Fairchild Communication Services Company and (y) the other
obligations of Fairchild expressly assumed by Shared Technologies as specified
on Schedule 9.1 to the Merger Agreement (including without limitation counsel
fees and expenses of FHC in the event Shared Technologies fails to assume the
defense thereof). Notwithstanding the foregoing, in no event shall FHC be
entitled to indemnification for, and the term "STI Losses" shall not include,
any consequential damages or damages which are speculative, remote
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or conjectural (except to the extent represented by a successful claim by a
third party).
If any action, proceeding or claim shall be brought or
asserted against FHC by any third party, which action, proceeding or claim, if
determined adversely to the interests of FHC would entitle FHC to indemnity
pursuant to this Agreement, FHC shall promptly, but in no event later than 10
days from the date FHC receives written notice of such action, proceeding or
claim, notify Shared Technologies of the same in writing specifying in detail
the basis of such claim and the facts pertaining thereto (but the failure to
give such notice in a timely fashion shall not affect Shared Technologies'
obligations under this Section 2 except to the extent it prejudiced or damaged
Shared Technologies' ability to defend, settle or compromise such claim or to
pay any Losses resulting therefrom), and Shared Technologies shall be entitled
(but not obligated) to assume the defense thereof by giving written notice
thereof within 10 days after Shared Technologies received notice of the claim
from FHC to FHC and have the sole control of defense and settlement thereof (but
only, with respect to any settlement, if such settlement involves an
unconditional release of FHC or any of its subsidiaries), including the
employment of counsel and the payment of all expenses.
3. Miscellaneous
3.1 Modification; Waivers. This Agreement may be modified or
amended only with the written consent of each party hereto. No party hereto
shall be released from its obligations hereunder without the written consent of
the other party. The observance of any term of this Agreement may be waived
(either generally or in a particular instance and either retroactively or
prospectively) by the party entitled to enforce such term, but any such waiver
shall be effective only if in a writing signed by the party against which such
waiver is to be asserted. Except as otherwise specifically provided herein, no
delay on the part of any party hereto in exercising any right, power or
privilege hereunder shall operate as a waiver thereof, nor shall any waiver on
the part of any party hereto of any right, power or privilege hereunder operate
as a waiver of any other right, power or privilege hereunder nor shall any
single or partial exercise of any right, power or privilege hereunder preclude
any other or further exercise thereof or the exercise of any other right, power
or privilege hereunder.
3.2 Entire Agreement. This Agreement represents the entire
understanding and agreement between the parties hereto with respect to the
subject matter hereof and supersedes all other prior
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agreements and understandings, both written and oral, between the parties with
respect to the subject matter hereof.
3.3 Severability. If any provision of this Agreement, or the
application of such provision to any Person or circumstance, shall be held
invalid, the remainder of this Agreement or the application of such provision to
other Persons or circumstances shall not be affected thereby; provided that the
parties shall negotiate in good faith with respect to an equitable modification
of the provision or application thereof held to be invalid.
3.4 Notices. (a) Any notice or communication to any party
hereto shall be duly given if in writing and delivered in person or mailed by
first class mail (registered or certified, return receipt requested), facsimile
or overnight air courier guaranteeing next day delivery, to such other party's
address.
If to ▇▇▇▇▇▇▇▇▇ Holding Corp.:
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇.▇. ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇, Esq.
with a copy to:
▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
If to Shared Technologies Inc.:
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: Legal Department
with a copy to:
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq.
▇▇▇▇▇▇ & Hannah
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Facsimile No. (▇▇▇) ▇▇▇-▇▇▇▇
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(b) All notices and communications will be deemed to have been
duly given: at the time delivered by hand, if personally delivered; five
business days after being deposited in the mail, if mailed; when receipt
acknowledged, if sent by facsimile; and the next business day after timely
delivery to the courier, if sent by overnight air courier guaranteeing next day
delivery.
3.5 Successors and Assigns. This Agreement shall inure to the
benefit of and shall be binding upon FHC and Shared Technologies and their
respective successors and assigns.
3.6 Counterparts. This Agreement may be executed in one or
more counterparts, each of which for all purposes shall be deemed to be an
original and all of which together shall constitute the same agreement.
3.7 Headings. The Section headings in this Agreement are for
convenience of reference only, and shall not be deemed to alter or affect the
meaning or interpretation of any provisions hereof.
3.8 Construction. This Agreement shall be governed, construed
and enforced with the laws of the state of New York, without regard to
principles of conflict of laws.
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IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their officers thereunto duly authorized as of the
date first written above.
▇▇▇▇▇▇▇▇▇ FASTENERS, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇
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Name:
Title:
SHARED TECHNOLOGIES INC.
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
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Name:
Title: