EXHIBIT 10.22
CASUALTY INSURANCE INDEMNITY AGREEMENT
CASUALTY INSURANCE INDEMNITY AGREEMENT dated as of March 20, 1997 by and
between GREAT AMERICAN MANAGEMENT AND INVESTMENT, INC., a Delaware corporation
("GAMI"), EAGLE INDUSTRIAL PRODUCTS CORPORATION, a Delaware corporation
("EIPC"), EAGLE INDUSTRIES, INC., a Delaware corporation ("Eagle") (GAMI, EIPC
and Eagle are referred to as the "Indemnifying Parties," and each as an
"Indemnifying Party"), and FALCON BUILDING PRODUCTS, INC., a Delaware
corporation ("Falcon"), HART & COOLEY, INC., a Delaware corporation ("HCI"),
MANSFIELD PLUMBING PRODUCTS INC., a Delaware corporation ("MPP"), and DEVILBISS
AIR POWER, INC., a Delaware corporation ("DAP") (Falcon, HCI, MPP and DAP are
referred to as the "Indemnified Companies," and each as an "Indemnified
Company").
WHEREAS, prior to October 1, 1995, Falcon was covered under various
insurance policies purchased by Eagle and EIPC (the "Insurance Policies");
WHEREAS, the Insurance Policies also cover various other entities, in
addition to the Indemnified Companies;
NOW, THEREFORE, in consideration of the mutual covenants contained herein,
and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto agree as follows:
1. INDEMNIFICATION.
1.1. INDEMNITY. Each Indemnifying Party, jointly and severally,
agrees to indemnify each of the Indemnified Companies, and each of their
respective directors, officers, employees, affiliates, subsidiaries and their
subsidiaries and affiliates (collectively, the "Indemnified Company Affiliates")
(the Indemnified Companies and their respective Indemnified Company Affiliates
are referred to herein as the "Indemnified Parties" and each as an "Indemnified
Party") against, and agrees to hold each Indemnified Party harmless from, any
and all debts, claims, obligations, liabilities, losses, costs, damages,
penalties or expenses (including without limitation reasonable attorneys' fees
and expenses and costs of investigation, litigation and settlement)
(collectively, "Losses") suffered by any Indemnified Party directly or
indirectly arising out of, based upon or resulting from the exhaustion of limits
of liability coverage for general liability, products liability, auto liability,
employers' liability, workers' compensation, directors' and officers' liability,
fiduciary liability or umbrella insurance policies of Eagle or EIPC covering
periods prior to October 1, 1995. However, there shall be no double recovery
hereunder as to a particular Loss by virtue of there being multiple Indemnified
Parties.
1.2. NOTICE OF CLAIMS; ASSUMPTION OF DEFENSE. Each Indemnified Party
shall give prompt notice to GAMI (which will act as representative of the
Indemnifying Parties for
purposes of this Agreement), in accordance with the terms of SECTION 2.2, of
the assertion of any claim, or the commencement of any suit, action or
proceeding by any party, in respect of which indemnity may be sought
hereunder, giving GAMI such information with respect thereto as GAMI may
reasonably request (but the giving of such notice shall not be a condition
precedent to indemnification hereunder). The Indemnifying Parties shall, at
their own expense, assume the defense thereof; provided that (i) counsel is
reasonably satisfactory to the Indemnified Party, and (ii) GAMI, on behalf of
itself and the other Indemnifying Parties, shall thereafter consult with the
Indemnified Party upon reasonable request for such consultation from time to
time with respect to such claim, suit, action or proceeding. The Indemnified
Party shall have the right (but not the duty) to participate in the defense
thereof and to employ counsel, at their own expense, separate from the
counsel employed by GAMI.
1.3. SETTLEMENT OR COMPROMISE. GAMI shall not settle or compromise
any claim, suit, action or proceeding without the prior written consent of the
Indemnified Party, which consent shall not be unreasonably withheld.
1.4. FAILURE OF INDEMNIFYING PARTY TO ACT. In the event that any
Indemnifying Party does not elect to assume the defense of any claim, suit,
action or proceeding, then any failure of such Indemnified Party to defend or to
participate in the defense of any such claim, suit, action or proceeding, or to
cause the same to be done, shall not relieve any Indemnifying Party of its
obligations hereunder.
1.5. BUY-OUT AGREEMENTS. In the event Eagle or EIPC, as the case may
be, determines to enter into a "buy-out agreement" with an insurance carrier
pursuant to which Eagle or EIPC pays consideration to eliminate the deductible
or self-insured retention with respect to all or a portion of a particular
policy period, then Eagle or EIPC, as applicable, shall notify Falcon of its
intention to enter into such transaction and the terms thereof. Falcon shall
have 30 days from the receipt of such notice to elect to participate in such
transaction by irrevocably agreeing to pay its portion of the consideration paid
by Eagle or EIPC. If Falcon elects not to so participate, it will continue to
be charged as though such buy-out transaction had not occurred.
2. MISCELLANEOUS PROVISIONS.
2.1. WAIVER AND AMENDMENT. The failure of any party hereto to comply
with any of the obligations or agreements set forth herein or to fulfill any
condition set forth herein may be waived only by written instrument signed by
all of the parties hereto. No failure by any party to exercise, and no delay in
exercising, any right hereunder shall operate as a waiver of such right
hereunder by any party hereto or preclude any other future exercise of that
right or any other right hereunder by such party. This Agreement may be amended
or modified only by a written instrument signed by all of the parties hereto.
2
2.2. NOTICES. All notices, requests or other communications
required or permitted hereunder shall be in writing and shall be deemed given
(i) when received if delivered by hand, (ii) on the date of transmission if
sent by telex, telecopy or other wire transmission (receipt confirmed), (iii)
one day after being sent by reputable overnight courier or (iv) five days
after being deposited in the U.S. mail, registered or certified mail, return
receipt requested, postage prepaid, in each case to the party to receive the
same at such party's respective address set forth below, or at such other
address as may from time to time be designated by such party to the other
parties hereto in accordance with this SECTION 2.2:
If to an Indemnifying Party, to:
Great American Management and Investment, Inc.
Two North Riverside Plaza
Suite 600
Chicago, Illinois 60606
Attn: Rod Dammeyer
Fax: (312) 902-1512
With a copy to:
Rosenberg & Liebentritt
Two North Riverside Plaza
Chicago, Illinois 60606
Attn: Donald Liebentritt, Esq.
Fax: (312) 454-0335
If to Falcon:
Falcon Building Products, Inc.
Two North Riverside Plaza
Suite 1100
Chicago, Illinois 60606
Attn: Gus J. Athas, Esq.
Fax: (312) 906-8402
With a copy to:
Mayer, Brown & Platt
190 South LaSalle Street
Chicago, Illinois 60603
Attn: James J. Junewicz, Esq.
Fax: (312) 701-7711
2.3. NO CREATION OF RIGHTS IN THIRD PARTIES. Nothing in this
Agreement, express or implied, is intended or shall be construed to confer upon
or give to any person, firm or corporation other than the parties hereto and
their successors and assigns any remedy or claim
3
under or by reason of this Agreement or any term, covenant or condition
hereof, and all the terms, covenants and conditions in this Agreement shall
be for the sole and exclusive benefit of the parties hereto and their
successors and assigns.
2.4. CAPTIONS AND PARAGRAPH HEADINGS. Captions and paragraph headings
used herein are for convenience only and are not a part of this Agreement and
shall not be used in construing it.
2.5. ENTIRE AGREEMENT. This Agreement embodies the entire
understanding of the parties hereto with respect to the subject matter hereof,
and there are no other agreements or understandings, written or oral, in effect
between the parties hereto with respect to the subject matter hereof. This
Agreement supersedes and terminates all prior discussions, negotiations,
understandings, arrangements and agreements among the parties hereto relating to
the subject matter hereof.
2.6. COUNTERPARTS. This Agreement may be executed in any number of
duplicate counterparts, each of which shall be deemed an original and all of
which together constitute one and the same instrument.
2.7. ASSIGNABILITY. This Agreement and the provisions hereof shall be
binding upon and inure to the benefit of the respective successors and assigns
of the parties hereto. No party may assign this Agreement without the prior
written consent of the other parties hereto. Any attempted assignment of this
Agreement without such prior written consent shall be void as to the other party
to this Agreement.
2.8. GOVERNING LAW. The validity, construction, operation and effect
of the terms of this Agreement shall be determined and enforced in accordance
with the laws of the State of Illinois without giving effect to principles of
conflicts of law thereunder.
2.9. EFFECTIVE TIME. This Agreement shall become effective at the
Effective Time, as if in effect from the signing of the Agreement and Plan of
Merger between Falcon Building Products, Inc. and FBP Acquisition Corp., Inc.,
dated March 20, 1997.
4
IN WITNESS WHEREOF, each of the parties has caused this instrument to be
signed on its behalf by a duly authorized officer as of the 20th day of March,
1997.
GREAT AMERICAN MANAGEMENT AND INVESTMENT, INC.
By: /s/ ROD DAMMEYER
----------------------
Name: Rod Dammeyer
Title: President
FALCON BUILDING PRODUCTS, INC.
By: /s/ GUS J. ATHAS
----------------------
Name: Gus J. Athas
Title: Senior Vice-President
EAGLE INDUSTRIES, INC.
By: /s/ GUS J. ATHAS
----------------------
Name: Gus J. Athas
Title: Senior Vice-President
EAGLE INDUSTRIAL PRODUCTS CORPORATION
By: /s/ GUS J. ATHAS
----------------------
Name: Gus J. Athas
Title: Senior Vice-President
5
MANSFIELD PLUMBING PRODUCTS, INC.
By: /s/ GUS J. ATHAS
----------------------
Name: Gus J. Athas
Title: Vice-President
DEVILBISS AIR POWER, INC.
By: /s/ GUS J. ATHAS
----------------------
Name: Gus J. Athas
Title: Vice-President
HART & COOLEY, INC.
By: /s/ GUS J. ATHAS
----------------------
Name: Gus J. Athas
Title: Vice-President
6