-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, PU+kmYAgJtYxme7AoSEuFxDfOyQOfJBixoOuQMUEau6TuPxrJjz2Z7NTXpRemveC aiVq4IJfTTNM06x3ePg/Tw== /in/edgar/work/20000720/0000950144-00-008903/0000950144-00-008903.txt : 20000920 0000950144-00-008903.hdr.sgml : 20000920 ACCESSION NUMBER: 0000950144-00-008903 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 6 CONFORMED PERIOD OF REPORT: 20000707 ITEM INFORMATION: ITEM INFORMATION: FILED AS OF DATE: 20000720 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ABLE TELCOM HOLDING CORP CENTRAL INDEX KEY: 0000826411 STANDARD INDUSTRIAL CLASSIFICATION: [1731 ] IRS NUMBER: 650013218 STATE OF INCORPORATION: FL FISCAL YEAR END: 1031 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 000-21986 FILM NUMBER: 675964 BUSINESS ADDRESS: STREET 1: 1000 HOLCOMB WOODS PARKWAY STREET 2: SUITE 440 CITY: ROSWELL STATE: GA ZIP: 30076 BUSINESS PHONE: 7709931570 MAIL ADDRESS: STREET 1: 1601 FORUM PLACE STREET 2: STE 305 CITY: WEST PALM BEACH STATE: FL ZIP: 33401 FORMER COMPANY: FORMER CONFORMED NAME: DELTA VENTURE FUND INC DATE OF NAME CHANGE: 19890312 8-K 1 e8-k.txt ABLE TELCOM HOLDING CORP. 1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 --------------- FORM 8 - K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES AND EXCHANGE ACT OF 1934 Date of earliest event reported: July 7, 2000 ABLE TELCOM HOLDING CORP. (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER) FLORIDA 0-21986 65-0013218 (STATE OF OTHER JURISDICTION OF (COMMISSION (IRS EMPLOYER INCORPORATION OR ORGANIZATION) FILE NUMBER) IDENTIFICATION NO.) 1000 HOLCOMB WOODS PARKWAY SUITE 440 ROSWELL, GEORGIA 30076 (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE) (770) 993-1570 (REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE) NOT APPLICABLE (FORMER NAME, FORMER ADDRESS AND FORMER FISCAL YEAR, IF CHANGED SINCE LAST REPORT) 2 ABLE TELCOM HOLDING CORP. FORM 8-K CURRENT REPORT EXPLANATORY NOTE Able Telcom Holding Corp. ("Registrant" or "Company") is filing this Form 8-K to disclose (i) the terms of the settlement agreement dated July 7, 2000 between the Company and Sirit Technologies, Inc., (the "Settlement Agreement") and (ii) certain amendments, as provided for in the Settlement Agreement, to its existing agreements with its former Series B Preferred Stock holders and its current Series C Preferred Stock holders. ITEM 5. OTHER EVENTS The Company and Sirit Technologies, Inc. ("Sirit") entered into the Settlement Agreement to settle Sirit Technologies, Inc. vs. Able Telcom Holding Corp. (Case Number 98-1153, United States District Court, Southern District of Florida). The Settlement Agreement resulted in the entry of a Consent Judgment pursuant to which the Court's Entry of Judgment Following Jury Verdict, dated May 16, 2000, in the amount of $31.5 million, was vacated. Under the Settlement Agreement, the Company agreed to make a cash payment of $5.0 million to Sirit and to use its best efforts to obtain all necessary corporate, regulatory and shareholder approvals required to issue to Sirit and register with the SEC on an effective Form S-1 Registration Statement approximately 5.0 million shares of Company common stock on or before November 30, 2000. If certain events, including both shareholder approval and registration, do not occur by November 30, 2000, the Company will be obligated under the Settlement Agreement to pay Sirit $20.0 million instead of issuing the common shares. Sirit also has the right to buy additional shares from the Company, if the Company sells additional shares within the next two years, on the same terms as the shares are sold to third parties in an amount sufficient to maintain its pro rata ownership of common stock. However, this right will not apply if the Company sells shares at a price of at least $10.00 per share. For more detailed information, please refer to Exhibit 10.52, the Agreement, which is filed as part of this Current Report on Form 8-K. In conjunction with the Agreement, the Company entered into certain amendments ("Amendments") to the agreements with its holders of Series B Preferred Stock and Series C Preferred Stock dated February 4, 2000. No shares of Series B Preferred Stock are now outstanding. The Amendments set a fixed $4.00 per share price for converting the Series C Preferred Stock, for an aggregate of 3.75 million shares of common stock, and extend the required date for registration of these common shares from October 31, 2000 until November 30, 2000. The conversion of the preferred shares is dependent upon shareholder approval of an increase in the number of authorized shares of common stock of the Company and of their issuance. If the shareholders fail to approve this issuance or the Company fails to have these shares registered by November 30, 2000, the holders of the Series C Preferred Stock will be entitled to a cash payment of $18.0 million. Further, the Series C Preferred Stock holders were issued additional warrants to purchase 750,000 shares of common stock at prices ranging from $6-8 per share. The Series C Preferred Stock holders further agreed to surrender their right to 3 purchase additional shares of preferred stock from the Company. For more detailed information, please refer to Exhibit 10.52, which is filed as part of this Current Report on Form 8-K. In addition, as provided in the Settlement Agreement, WorldCom, the Company's largest customer and shareholder, agreed to (i) extend the term of the existing Master Services Agreement with the Company by three years to July 1, 2006 and (ii) to convert debt of approximately $36.5 million which is currently due from the Company into seven-year term debt. WorldCom and the Company are currently negotiating documentation to effect these agreements. For more detailed information, please refer to Exhibit 10.52, which is filed as part of this Current Report on Form 8-K. 4 ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS (c) Exhibits
EXHIBIT NO. DESCRIPTION - ------- ----------- 2.5.4 Master Services Agreement between WorldCom Network Services, Inc. and MFS Network Technologies, Inc. dated as of July 2, 1998 (exhibits omitted) (1) 4.19 Series B Convertible Preferred Stock Exchange Agreement by and between Able Telcom Holding Corp. and the RoseGlen Group dated February 4, 2000 (2) 4.19.1 Amendment No. 1 to Securities Exchange Agreement and Related Registration Rights Agreement of Able Telcom Holding Corp. [RGC International Investors, LDC], dated July 7, 2000. 4.21 Registration Rights Agreement associated with Series B Convertible Preferred Stock Exchange Agreement (2) 4.21.1 Amendment No. 1 to Securities Exchange Agreement and Related Registration Rights Agreement of Able Telcom Holding Corp., dated July 7, 2000. 4.22 Series C Convertible Preferred Stock Purchase Agreement (2) 4.22.1 Amendment No. 1 to Able Telcom Holding Corp. Series C Convertible Preferred Stock Purchase Agreement and Related Agreements, dated July 7, 2000. 10.52 Settlement Agreement, between the Sirit Parties and the Able Parties, dated July 7, 2000. 99 Press Release issued July 12, 2000 (1) Incorporated by reference from an exhibit to the Company's Current Report on Form 8-K (File No. 0-21986), as filed August 3, 1998. (2) Incorporated by reference from an exhibit to the Company's Annual Report of Form 10-K (File No. 0-21986), for the fiscal year ended October 31, 1999, as filed February 22, 2000.
5 SIGNATURES Pursuant to the requirements of the Securities and Exchange Act of 1934, the Company has duly caused this report to be signed on its behalf by the undersigned there unto duly authorized. ABLE TELCOM HOLDING CORP. (The Company) /s/ BILLY V. RAY, JR. -------------------------------------- Date: July 14, 2000 Name: Billy V. Ray, Jr. Title: Chief Executive Officer EX-4.19.1 2 ex4-19_1.txt AMENDMENT NO.1 TO SECURITIES EXCHANGE AGREEMENT 1 EXHIBIT 4.19.1 AMENDMENT NO. 1 TO SECURITIES EXCHANGE AGREEMENT AND RELATED REGISTRATION RIGHTS AGREEMENT OF ABLE TELCOM HOLDING CORP. [RGC INTERNATIONAL INVESTORS, LDC] This Amendment No. 1 ("Amendment No. 1") dated as of July 7, 2000 to the Securities Exchange Agreement dated as of February 4, 2000 ("Exchange Agreement"), by and between RGC International Investors, LDC ("Holder") and Able Telcom Holding Corp. (the "Company"), and an amendment to a related Registration Rights Agreement entered into by the Holder and the Company pursuant to the Exchange Agreement as specifically described herein. RECITALS WHEREAS, in June 1998 the Company issued, pursuant to a Purchase Agreement (the "Series B Purchase Agreement") to the Holder, 2000 shares of Series B Preferred Stock, and in connection therewith, the Holder and the Company entered into a Registration Rights Agreement substantially in the form of Exhibit A hereto (the "Series B Registration Rights Agreement"), the Articles of Amendment substantially in the form of Exhibit B hereto (the "Series B Articles of Amendment") and other documents related to the issuance of Series B Preferred Stock and included as exhibits to the Company's public filings with the Securities and Exchange Commission (the "Series B Agreements" and collectively with the Series B Registration Rights Agreement and the Series B Articles of Amendment, the "Series B Documents"); and WHEREAS, in February 2000 the Holder and the Company entered into the Exchange Agreement, a copy of which is attached as Exhibit C and incorporated by reference herein, whereby, in exchange for the surrender to the Company by the Holder of 375 Preferred Shares (constituting all the Company's Series B Preferred Shares then still held by the Holder), the Company issued 500,000 shares of Company Common Stock, $0.001 par value per share (the "Common Stock"), plus $5,031,978 in cash, and the registration rights and warrants described in the next succeeding paragraphs; and WHEREAS, the Company and the Holder, as of February 4, 2000, entered into a Registration Rights Agreement ("Exchange Registration Rights Agreement") substantially in the form of Exhibit D attached hereto and incorporated by reference herein, to provide for the registration of the shares of Common Stock issued to the Holder pursuant to the Exchange Agreement and the shares underlying the Warrants issued pursuant to the Exchange Agreement; and WHEREAS, the Company issued to the Holder warrants for 100,000 shares of Common Stock, referred to as the "Warrants", a form of the Warrant being substantially in the form as Exhibit F hereto which form shall be incorporated by reference herein; and WHEREAS, the Company and the Holder are entering into this Amendment No. 1 in connection with the Company's settlement of its obligation to Sirit Technologies, Inc. ("Sirit"), as - 1 - 2 described in the Settlement Agreement between the Sirit Parties and the Able Parties (as each of those terms are defined in the Sirit Settlement Agreement) dated as of July 7, 2000 (the "Sirit Agreement"); and WHEREAS, the Holder and the Company wish in this Amendment No. 1 to amend the Exchange Agreement and the Exchange Registration Rights Agreement, but not the Warrant or the other Series B Documents (together, the "Transaction Documents"); and WHEREAS, the Company will, as promptly as possible, call and hold a shareholders meeting to consider and approve (1) an amendment to the Company's Articles of Incorporation to increase the number of shares of authorized Common Stock to 100,000,000 shares of Common Stock; (2) one or more proposals to issue the shares of Common Stock pursuant to this Amendment No. 1 and pursuant to certain other agreements between the Holder and the Company; (to the extent shareholder approval of such issuance is required) and (3) a proposal to issue shares of Common Stock pursuant to the Sirit Agreement (matters (1), (2) and (3) together, the "Shareholder Proposals"). NOW, THEREFORE, intending to be legally bound hereby, the Parties agree that all capitalized terms not defined herein shall have the meanings ascribed to them in the Exchange Agreement and as follows: 1. Recitals. The above recitals are true, correct and incorporated herein by reference. 2. Amendment to Exchange Registration Rights Agreement to Revise Definition of Registration Deadline. The term "Registration Deadline" in Section 1 of the Exchange Registration Agreement shall be amended and restated in its entirety to read as follows: "Registration Deadline" shall mean the date the Company, using its Best Efforts, is able to secure the effectiveness of the Registration Statement (defined herein); provided, however, that in no event shall the Registration Deadline be later than November 30, 2000." 3. Agreement with Respect to Bankruptcy. The Holder agrees not to place Able in involuntary bankruptcy from the date of this Agreement until either (a) if the Sirit Shares are issued prior to December 1, 2000, 91 days following the issuance of the Sirit Shares; or (b) if the Sirit Shares are not issued by December 1, 2000, for 91 days following the date on which the Consent Judgment has been paid or satisfied in full (but in no event later than May 31, 2001). - 2 - 3 4. Proxy. The Holder shall execute a form of proxy attached to this Amendment No. 1 as Exhibit "F" whereby the Holder agrees to vote any shares of Common Stock held by the Holder in support of the Shareholder Proposals. 5. Condition to Effectiveness of Amendment No. 1. This Amendment No. 1 shall not be effective until all of the conditions contained in Section XI (other than Condition XI.B. which is covered by this Amendment No. 1) of the Sirit Agreement have been satisfied in full (unless waived by the Investors). The Company shall inform the Holder in writing upon the satisfaction of such conditions. The Holder may waive satisfaction of such conditions at any time. 6. Miscellaneous. a. Entire Understanding. This Amendment No. 1, together with the Transaction Documents, contains the entire understanding of the parties with respect to the matters covered hereby. Except as set forth in this Amendment No. 1, the terms of the Transaction Documents shall remain in full force and effect. b. Further Actions. The Company and the Holder acknowledge that this Amendment No. 1 is being entered into in connection with the Company's settlement of its obligation to Sirit arising out of certain litigation with the Sirit. The Company and the Holder agree that they shall take such further actions as may be required to effect the intent and purpose of this Amendment No. 1, including the filing of amended Articles of Amendment and the execution of any further amendments to any of the Transaction Documents, as may be reasonably requested by the Company or any Investor, to carry out the purpose and intention of this Agreement. c. Governing Law. This Amendment No. 1 shall be governed by and construed and enforced in accordance with the laws of the State of New York applicable to agreements executed and to be performed entirely within such state and, where applicable, federal law. d. Counterpart Signatures. This Amendment No. 1 may be executed in two or more counterparts, all of which shall be considered one and the same amendment, it being understood that all parties need not sign the same counterpart. e. Construction. The language in this Amendment No. 1 will be deemed to be the language chosen by the parties to express their mutual intent, and no rules of strict construction shall be applied against any party. f. Conflict with other Documents. To the extent that the provisions of any of the Transaction Documents conflict with this Amendment No. 1, the terms of this Amendment No. 1 shall govern provided that, the parties acknowledge and agree that if any references to section or paragraph number are not accurately reflected in this Amendment No. 1, then this Amendment No. - 3 - 4 1 shall be amended to reflect such changes without any further actions on the part of any of the parties. [SIGNATURES ON THE NEXT PAGE] - 4 - 5 IN WITNESS WHEREOF, the Parties hereto have caused this Amendment No. 1 to be executed as of the day and year first above written. HOLDER: RGC INTERNATIONAL INVESTORS, LDC By: Rose Glen Capital Management, L.P. Investment Manager By: RGC General Partner Corp. As General Partner By: --------------------------------- Name: --------------------------------- Title: --------------------------------- ABLE TELCOM HOLDING CORP. By: --------------------------------- Name: --------------------------------- Title: --------------------------------- - 5 - 6 EXHIBIT "F" ABLE TELCOM HOLDING CORP. PROXY I appoint Michael Brenner and Edward Z. Pollock, or either one, the undersigned's proxy to vote all of its shares of common stock of Able Telcom Holding Corp. that are entitled to vote at any meeting of Able Telcom Holding Corp. shareholders called to approve the Shareholder Proposals (as defined in Amendment No. 1 to Securities Exchange Agreement and Related Registration Rights Agreement of the Company and the undersigned dated as of July 7, 2000), including the proposal to issue to Sirit Technologies shares of Common Stock pursuant to the Settlement Agreement, dated as of July 7, 2000 (the "Sirit Agreement"), between the "Sirit Parties" and the "Able Parties"; as each of those terms is defined in the Sirit Agreement, a copy of which Sirit Agreement is attached as Exhibit "A," in favor of the Shareholder Proposals. This proxy shall expire and be of no further force and effect after December 1, 2000. - ----------------, -------- (Complete above date and sign your name as it appears below. If more than one name appears, each person should sign). - ---------------------------------------- By: ------------------------------- Name: ----------------------------- Its: ------------------------------ Number of shares of common stock - ---------------------------------------- - 6 - EX-4.21.1 3 ex4-21_1.txt AMENDMENT NO.1 SECURITIES EXCHANGE AGREEMENT 1 EXHIBIT 4.21.1 AMENDMENT NO. 1 TO SECURITIES EXCHANGE AGREEMENT AND RELATED REGISTRATION RIGHTS AGREEMENT OF ABLE TELCOM HOLDING CORP. This Amendment No. 1 ("Amendment No. 1") dated as of July 7, 2000 to the Securities Exchange Agreement dated as of February 4, 2000 ("Exchange Agreement"), by and among Halifax Fund, L.P., The Gleneagles Fund Company, Palladin Overseas Fund Limited, Colonial Penn Life Insurance Company, Palladin Securities, L.L.C. and Palladin Partners I, L.P. (collectively, "Holders") and Able Telcom Holding Corp. (the "Company"), and an amendment to a related Registration Rights Agreement entered into by the holders and the Company pursuant to the Exchange Agreement as specifically described herein. RECITALS WHEREAS, in June 1998 the Company issued, pursuant to a Purchase Agreement (the "Series B Purchase Agreement") to the Holders, 404 shares of Series B Preferred Stock, and in connection therewith, the Holders and the Company entered into a Registration Rights Agreement substantially in the form of Exhibit A hereto (the "Series B Registration Rights Agreement"), the Articles of Amendment substantially in the form of Exhibit B hereto (the "Series B Articles of Amendment") and other documents related to the issuance of Series B Preferred Stock and included as exhibits to the Company's public filings with the Securities and Exchange Commission (the "Series B Agreements" and collectively with the Series B Registration Rights Agreement and the Series B Articles of Amendment, the "Series B Documents"); and WHEREAS, in February 2000 the Holders and the Company entered into the Exchange Agreement, a copy of which is attached as Exhibit C and incorporated by reference herein, whereby, in exchange for the surrender to the Company by the Holders of 154 Preferred Shares (constituting all the Company's Series B Preferred Shares then still held by the Holders), the Company issued 301,787 shares of Company Common Stock, $0.001 par value per share (the "Common Stock"), plus $5,816,394 in cash, and the registration rights and warrants described in the next succeeding paragraphs; and WHEREAS, Section 1.2 of the Exchange Agreement provides that an additional amount of cash will be paid to the Holders by the Company 100 Trading Days after the date of the date of the Exchange Agreement; WHEREAS, the Company and the Holders, as of February 4, 2000, entered into a Registration Rights Agreement ("Exchange Registration Rights Agreement") substantially in the form of Exhibit D attached hereto and incorporated by reference herein, to provide for the registration of the shares of Common Stock issued to the Holders pursuant to the Exchange Agreement; and WHEREAS, the Company issued to the Holders warrants for 66,246 shares of Common - 1 - 2 Stock, referred to as the "First Exchange Warrants", a form of the First Exchange Warrant being substantially in the form as Exhibit E hereto and which form shall be incorporated by reference herein; and WHEREAS, the Company issued to the Holders warrants for 100,000 shares of Common Stock, referred to as the "Second Exchange Warrants", a form of the Second Exchange Warrant being substantially in the form as Exhibit F hereto which form shall be incorporated by reference herein; and WHEREAS, the Company and the Holder are entering into this Amendment No. 1 in connection with the Company's settlement of its obligation to Sirit Technologies, Inc. ("Sirit"), as described in the Agreement between the Sirit Parties and the Able Parties (as each of those terms are defined in the Sirit Agreement) dated as of July 7, 2000 (the "Sirit Agreement"); and WHEREAS, the Holders and the Company wish in this Amendment No. 1 to amend the Exchange Agreement and the Exchange Registration Rights Agreement, but not the First Exchange Warrant or the Second Exchange Warrant or the other Series B Documents (together, the "Transaction Documents"); and WHEREAS, the Company will, as promptly as possible, call and hold a shareholders meeting to consider and approve (1) an amendment to the Company's Articles of Incorporation to increase the number of shares of authorized Common Stock to 100,000,000 shares of Common Stock; (2) one or more proposals to issue the shares of Common Stock pursuant to this Amendment No. 1 and pursuant to certain other agreements between the Holder and the Company; and (3) a proposal to issue shares of Common Stock pursuant to the Sirit Agreement (matters (1), (2) and (3) together, the "Shareholder Proposals"). NOW, THEREFORE, intending to be legally bound hereby, the Parties agree that all capitalized terms not defined herein shall have the meanings ascribed to them in the Exchange Agreement and as follows: 1. Recitals. The above recitals are true, correct and incorporated herein by reference. 2. Amendment to Section 1.2 of the Exchange Agreement. Section 1.2 of the Exchange Agreement shall be revised and restated in its entirety to read as follows: "On or before December 1, 2000, the Company shall issue to the Holders, pro rata in accordance with the number of shares purchased by the Holders at the Closing, 1,057,031 shares of Common Stock; provided that the Company's shareholders have, prior to December 1, 2000, approved the Shareholder Proposals. In the event that the shareholders have not, prior to December 1, 2000, approved the Shareholder Proposals, upon demand at the option of the Holders in lieu of issuing such shares, the Company shall pay to the Holders, pro rata, $4,228,124 in cash, by wire transfer or (b) the Company shall upon - 2 - 3 demand by the Holders at any time after the Shareholder Proposals have been approved, issue such shares of Common Stock." 3. Amendment to Exchange Registration Rights Agreement to Revise Definition of Registration Deadline. The term "Registration Deadline" in Section 1 of the Exchange Registration Agreement shall be amended and restated in its entirety to read as follows: "Registration Deadline" shall mean the date the Company, using its Best Efforts, is able to secure the effectiveness of the Registration Statement (defined herein); provided, however, that in no event shall the Registration Deadline be later than November 30, 2000." 4. Agreement with Respect to Bankruptcy. The Holders agree not to place Able in involuntary bankruptcy from the date of this Agreement until either (a) if the Sirit Shares are issued prior to December 1, 2000, 91 days following the issuance of the Sirit Shares; or (b) if the Sirit Shares are not issued by December 1, 2000, for 91 days following the date on which the Consent Judgment has been paid or satisfied in full, but in no event later than May 31, 2001. 5. Proxy. Each of the Holders shall execute a form of proxy attached to this Amendment No. 1 as Exhibit "F" whereby the Holders agrees to vote any shares of Common Stock held by the Holders in support of the Shareholder Proposals. 6. Condition to Effectiveness of Amendment No. 1. This Amendment No. 1 shall not be effective until all of the conditions contained in Section XI (other than Condition XI.B. which is covered by this Amendment No. 7) of the Sirit Agreement have been satisfied in full (unless waived by the Holders). The Company shall inform the Holders in writing upon the satisfaction of such conditions. The Holders may waive satisfaction of such conditions at any time. 7. Miscellaneous. a. Entire Understanding. This Amendment No. 1, together with the Transaction Documents, contains the entire understanding of the parties with respect to the matters covered hereby. Except as set forth in this Amendment No. 1, the terms of the Transaction Documents shall remain in full force and effect. - 3 - 4 b. Further Actions. The Company and the Holders acknowledge that this Amendment No. 1 is being entered into in connection with the Company's settlement of its obligation to Sirit arising out of certain litigation with the Sirit. The Company and the Holders agree that they shall take such further actions as may be required to effect the intent and purpose of this Amendment No. 1, including the filing of amended Articles of Amendment and the execution of any further amendments to any of the Transaction documents, as may be reasonably requested by the Company or any Investor, to carry out the purpose and intention of this Agreement. c. Governing Law. This Amendment No. 1 shall be governed by and construed and enforced in accordance with the laws of the State of New York applicable to agreements executed and to be performed entirely within such state and, where applicable, federal law. d. Counterpart Signatures. This Amendment No. 1 may be executed in two or more counterparts, all of which shall be considered one and the same amendment, it being understood that all parties need not sign the same counterpart. e. Construction. The language in this Amendment No. 1 will be deemed to be the language chosen by the parties to express their mutual intent, and no rules of strict construction shall be applied against any party. f. Conflict with other Documents. To the extent that the provisions of any of the Transaction Documents conflict with this Amendment No. 1, the terms of this Amendment No. 1 shall govern provided that, the parties acknowledge and agree that if any references to section or paragraph number are not accurately reflected in this Amendment No. 1, then this Amendment No. 1 shall be amended to reflect such changes without any further actions on the part of any of the parties. [SIGNATURES ON THE NEXT PAGE] - 4 - 5 IN WITNESS WHEREOF, the Parties hereto have caused this Amendment No. 1 to be executed as of the day and year first above written. HOLDERS: HALIFAX FUND, L.P. THE GLENEAGLES FUND COMPANY PALLADIN OVERSEAS FUND LIMITED COLONIAL PENN LIFE INSURANCE COMPANY By: ------------------------------------------------- The Palladin Group, L.P., as Attorney-in-Fact and Investment Advisor Name: Robert L. Chender Title: Managing Director PALLADIN SECURITIES L.L.C. By: ------------------------------------------------- : Name: Robert L. Chender Title: Principal PALLADIN PARTNERS I, L.P. By: ------------------------------------------------- The Palladin Group, L.P., as Attorney-in-Fact and Investment Advisor Name: Robert L. Chender Title: Managing Director ABLE TELCOM HOLDING CORP. By: ------------------------------------------------- Name: ------------------------------------------------- Title ------------------------------------------------- - 5 - 6 EXHIBIT "F" ABLE TELCOM HOLDING CORP. PROXY I appoint Michael Brenner and Edward Z. Pollock, or either one, the undersigned's proxy to vote all of its shares of common stock of Able Telcom Holding Corp. that are entitled to vote at any meeting of Able Telcom Holding Corp. shareholders called to approve the Shareholder Proposals (as defined in Amendment No. 1 to the Securities Exchange Agreement and related Registration Rights Agreement of the Company and the undersigned dated as of July 7, 2000), including the proposal to issue to Sirit Technologies shares of Common Stock pursuant to the Settlement Agreement, dated July 7, 2000 (the "Sirit Agreement"), between the "Sirit Parties" and the "Able Parties"; as each of those terms is defined in the Sirit Agreement, a copy of which Sirit Agreement is attached as Exhibit "A," in favor of the Shareholder Proposals. This proxy shall expire and be of no further force and effect after December 1, 2000. - ----------------, -------- (Complete above date and sign your name as it appears below. If more than one name appears, each person should sign). - ---------------------------------------- By: ------------------------------- Name: ----------------------------- Its: ------------------------------ Number of shares of common stock - ---------------------------------------- - 6 - EX-4.22.1 4 ex4-22_1.txt AMENDMENT NO.1 TO STOCK PURCHASE AGREEMENT 1 EXHIBIT 4.22.1 AMENDMENT NO. 1 TO ABLE TELCOM HOLDING CORP. SERIES C CONVERTIBLE PREFERRED STOCK PURCHASE AGREEMENT AND RELATED AGREEMENTS This Amendment No. 1 ("Amendment No. 1") dated July 7, 2000 amends (i) the Convertible Preferred Stock Purchase Agreement ("Purchase Agreement") dated as of February 4, 2000 between Able Telcom Holding Corp., a Florida corporation (the "Company"), and each person or entity listed as an Investor on Schedule I to this Amendment No. 1 (each, individually, an "Investor" and, collectively, the "Investors") and (ii) certain other related agreements referenced in this Amendment No. 1. W I T N E S S E T H: WHEREAS, the Company and the Investors entered into the Purchase Agreement pursuant to which the Investors purchased 5,000 shares of Series C Convertible Preferred Stock (the "Series C Preferred Stock/Preferred Shares") from the Company, which Series C Preferred Stock has the rights and remedies set forth in the Articles of Amendment setting forth the terms of the Series C Preferred Stock ("Articles of Amendment") in the form of Exhibit A attached hereto and incorporated herein by reference; and WHEREAS, the Company and the Investors, as of February 4, 2000, entered into a Registration Rights Agreement ("Registration Rights Agreement") substantially in the form of Exhibit B attached hereto and incorporated herein by reference; and WHEREAS, the Company issued to the Investors warrants ("Series C Warrants") to purchase up to 200,000 shares of common stock, $0.001 par value per share, of the Company ("Common Stock"), a form of warrant being substantially in the form as Exhibit C hereto and incorporated herein by reference (the Purchase Agreement, the Articles of Amendment, the Registration Right Agreement and the Series C Warrants, collectively, the "Transaction Documents"); and WHEREAS, the Company and the Investors are entering into this Amendment No. 1 in connection with the Company's settlement of its obligation to Sirit Technologies, Inc. ("Sirit"), as described in the Agreement between the Sirit Parties and the Able Parties (as each of those terms are defined in the Sirit Agreement) dated as of July 7, 2000 (the "Sirit Agreement"). WHEREAS, the Company will, as promptly as possible, call and hold a shareholders meeting to consider and approve (1) an amendment to the Company's Articles of Incorporation to increase the number of shares of authorized Common Stock to 100,000,000 shares of Common Stock; (2) one or more proposals to issue the shares of Common Stock pursuant to this Amendment No. 1 and pursuant to certain other agreements between the Investors and the Company; and (3) a proposal to issue shares of Common Stock pursuant to the Sirit Agreement (matters (1), (2) and (3) together, the "Shareholder Proposals"). 1 2 NOW, THEREFORE, in consideration of the foregoing premises and the covenants herein contained and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree that all capitalized terms used herein and not defined herein shall have the meanings ascribed to them in the respective Transaction Document and as follows: 1. Recitals. The above recitals are true, correct and incorporated herein by reference. 2. Amendments Affecting Conversion Price Contained in Articles of Amendment. Section 3(b)(iii) of the Articles of Amendment shall be amended and restated in its entirety to read as follows: "'Conversion Price' shall mean, as of any Conversion Date (as defined in Section 3(e)) or other date of determination, a price equal to $4.00." 3. Permitted Issuance of Shares to Sirit and the Investors. Section 3(c)(i) of the Articles of Amendment shall be amended to add the following clause to the end of the parenthetical in the first sentence of Section 3(A): "or (z) pursuant to Section II(B)(1) of the Agreement between Sirit Technologies, Inc., the Company and certain other parties as specified therein, dated July 7, 2000 or (xx) to any of the Investors or any "Holder" or "Holders", as such terms are defined in (A) Amendment No. 1 to the Securities Exchange Agreement of Able Telcom Holding Corp. dated July 7, 2000 between the Company and Halifax Fund, L.P., The Gleneagles Fund Company, Palladin Partners I, L.P (the "Amendment No. 1 to the Palladin Exchange Agreement"), or (B) Amendment No. 1 to the Securities Exchange Agreement of Able Telcom Holding Corp. dated July 7, 2000 between the Company and RGC International Investors, LDC (the "Amendment No. 1 to the RoseGlen Exchange Agreement")." 4. Limitation on Number of Shares of Common Stock that may be Issued to Holders Prior to November 30, 2000. Subject to the provisions of Section 3(c) (ii), (iii), (iv) and (iv) of the Articles of Amendment and notwithstanding any adjustment to the Conversion Price that may have occurred pursuant to Section 3(c)(i) of the Articles of Amendment, the Investors agree that they shall not, prior to November 30, 2000, convert (on a pro rata basis according to the Investors' holdings of Series C Preferred Stock immediately after the Closing under the Purchase Agreement) shares of Series C Preferred Stock to acquire more than 3,750,000 shares of Common Stock. 5. Dividends. Section (2) of the Articles of Amendment shall be amended to add the following sentence to the end of such Section: 2 3 "Notwithstanding the foregoing, all dividends that will have accrued through November 30, 2000 shall be paid in cash on or before December 1, 2000 and shall not accrete to the Liquidation Value; provided that to the extent any such dividends are not paid by the Company in cash for any reason on or before December 1, 2000, such dividends not so paid shall accrete to the Liquidation Value. 6. Conversion Rights. Notwithstanding anything else in this Agreement or any of the Transaction Documents to the contrary, the Investors hereby agree that they shall not convert any of their Preferred Shares until the earlier to occur of (i) shareholder approval having been obtained to (A) issue shares of Common Stock to the Investors pursuant to the Articles of Amendment; and (B) increase its authorized capital stock to 100,000,000 shares of Common Stock; and (ii) December 1, 2000. 7. Amendment to Redemption Right in Articles of Amendment. Section 3(f)(i) of the Articles of Amendment shall be amended and restated in its entirety to read as follows: (i) First Company Redemption Rights. Subject to the restrictions and conditions contained in paragraphs (a) and (b) of this Section 3 and the exercise by any holder of its right to redeem Preferred Shares under Section 4, commencing on the later of either 60 days after the Registration Statement first becomes effective or December 31, 2000, the Company may, at its option, from time to time, require all holders to redeem their Preferred Shares, in whole or in part as specified by the Company (such redemption, a "FIRST COMPANY REDEMPTION"), at the Company Redemption Price (as defined below) pursuant to a Company Redemption Notice following the procedures set forth in Section 3(f)(iv); provided, however, that no First Company Redemption shall be permitted unless the Registration Statement has been effective under the Securities Act of 1933, as amended (the "ACT"), for at least 60 consecutive days preceding the date of such Company Redemption Notice; and any such Company Redemption Notice shall be void with respect to any Preferred Shares that shall have been converted prior to the effective date of such Company Redemption Notice. A First Company Redemption under this Section 3(f)(i) shall be effective upon the close of business on the 30th calendar day after the date that the Company Redemption Notice is received by each holder. Nothing in this Section 3(f) shall be construed to preclude the holders from being permitted, notwithstanding a Company Redemption Notice, to convert any or all Preferred Shares to the extent provided by Section 3(a) prior to the effective date of a Company Redemption Notice. The "COMPANY REDEMPTION PRICE" shall be the sum of (A) the Liquidation Value at 3 4 the effective date of the First Company Redemption, plus (B) 10% of such Liquidation Value for each whole or partial six-month period between the Closing Date and the effective date of the First Company Redemption. 8. Amendment to Definition of Registration Deadline in Registration Rights Agreement. The definition of "Registration Deadline" in Section 1 of the Registration Rights Agreement is hereby amended and restated in its entirety to read as follows: "Registration Deadline" shall mean the date the Company, using its Best Efforts, is able to secure the effectiveness of the Registration Statement (defined herein); provided, however, that in no event shall the Registration Deadline be later than November 30, 2000. 9. Amendment to Right of First Refusal Contained in Purchase Agreement. The parenthetical contained in the first sentence of Section 3.18 shall be amended to add at the end thereof the following clause: "or in connection with (A) Amendment No. 1 to the Palladin Exchange Agreement, (B) Amendment No. 1 to the Rose Glen Exchange Agreement, and (c) the issuance to Sirit Technologies, Inc. shares of Common Stock pursuant to Section II(B)(1) of the Agreement dated July 7, 2000 between Sirit and the Company and certain other parties as specified therein". 10. Issuances of Equity. Section 3(d) of the Articles of Amendment is modified to provide that the Company may issue equity securities, instruments or rights convertible or into or exchangeable or exercisable for, equity securities in connection with or relating to (i) Section II.B.1 of the Sirit Agreement; and (ii) any shares of Common Stock issued to any of the Investors or any "Holder" or "Holders", as such terms are defined in (A) the Amendment No. 1 to the Palladin Exchange Agreement, or (B) the Amendment No. 1 to the RoseGlen Exchange Agreement. 10A. Rescission of Section 5.1 of the Purchase Agreement Section 5.1 (Investor Rights to Purchase Additional Shares) of the Purchase Agreement is hereby terminated and deleted in its entirety. 10B. Additional Warrants The Company agrees to issue additional warrants to the Investors, such warrants to be substantially in the form of the Series C Warrants, to have the benefit of the Registration Rights Agreement and to be in two series, each with a term of two years, one series for 375,000 shares of Common Stock exercisable at $6.00 per share and the second series for 375,000 of Common Stock exercisable at $8.00 per share. 4 5 11. Proxy. Each of the Investors shall execute a form of proxy attached to this Amendment No. 1 as Exhibit "F" whereby each Investor agrees to vote any shares of Common Stock held by such Investor in support of the Shareholder Proposals. 12. Delay in Exercise of Monetary and Other Remedies. Other than as specifically contemplated by this Amendment No.1 (or any other agreement entered into between the Company and the Investors and any affiliates of the Investors of even date), each of the Investors agrees that they will not provide a Notice of Redemption upon Triggering Event until after December 1, 2000 under Section 4(b) of the Articles of Amendment. 13. Condition to Effectiveness of Amendment No. 1. This Amendment No. 1 shall not be effective until all of the conditions contained in Section XI (other than Section XIB, which is covered by this Amendment No. 1) of the Sirit Agreement have been satisfied in full (unless waived by the Investors). The Company shall inform the Investors in writing when such conditions shall have been satisfied. The Investors may waive satisfaction of such conditions at any time. 14. Agreement with Respect to Bankruptcy. The Investors agree not to place Able in involuntary bankruptcy from the date of this Agreement until either (a) if the Sirit Shares are issued prior to December 1, 2000, 91 days following the issuance of the Sirit Shares; or (b) if the Sirit Shares are not issued by December 1, 2000, for 91 days following the date on which the Consent Judgment has been paid or satisfied in full, but in no event later than May 31, 2001. 15. Call Feature of the Company. Notwithstanding any provision of the Purchase Agreement or Articles of Amendment to the contrary, at any time prior to August 31, 2000 the Company shall have the right, at the Company's option, upon prior written notice, to require all of the Holders to tender their Preferred Shares for redemption at a redemption price of $3600 per Preferred Share payable in cash; provided however, the Holders may elect in their sole discretion to convert their Preferred Shares into Common Stock at the Conversion Price of $4.00 per share; provided that such conversion shall not be prohibited by or be in derogation of any securities laws or rules including without limitation any NASDAQ marketplace rules specifically NASDAQ marketplace rule 4460(l). 5 6 16. Miscellaneous. a. Entire Understanding. This Amendment No. 1, together with the Transaction Documents, contains the entire understanding of the parties with respect to the matters covered hereby. Except as expressly set forth in this Amendment No. 1, the terms of the Transaction Documents remain in full force and effect. b. Further Actions. The Company and the Investors acknowledge that this Amendment No. 1 is being entered into in connection with the Company's settlement of its obligation to Sirit arising out of certain litigation with Sirit. The Company and the Investors agree that they shall take such further actions, including the filing of amended Articles of Amendment and the execution of any further amendments to any of the Transaction documents, as may be reasonably requested by the Company or any Investor, to carry out the purpose and intention of this Amendment. c. Governing Law. This Amendment No. 1 shall be governed by and construed and enforced in accordance with the laws of the State of New York applicable to agreements executed and to be performed entirely within such state and, where applicable, federal law. d. Counterpart Execution. This Amendment No. 1 may be executed in two or more counterparts, all of which shall be considered one and the same amendment, it being understood that all parties need not sign the same counterpart. e. Construction. The language in this Amendment No. 1 will be deemed to be the language chosen by the parties to express their mutual intent, and no rules of strict construction shall be applied against any party. f. Conflict with Other Documents. To the extent that the provisions of any of the Transaction Documents conflict with this Amendment No. 1, the terms of this Amendment No. 1 shall govern; provided that the parties acknowledge and agree that if any references to section or paragraph numbers are not accurately reflected in this Amendment No. 1., then this Amendment No. 1 shall be amended to reflect such changes without any further actions on the part of any of the parties. [SIGNATURES ON THE NEXT PAGE] 6 7 IN WITNESS WHEREOF, the Parties hereto have caused this Amendment No. 1 to be duly executed as of the date first above written. ABLE TELCOM HOLDING CORP. By: -------------------------------------- Name: Billy V. Ray, Jr., Title: Chairman of the Board INVESTORS: HALIFAX FUND, L.P. By: The Palladin Group, L.P., as Investment Manager By: --------------------------- Name: Robert L. Chender Title: Managing Director THE GLENEAGLES FUND COMPANY By: The Palladin Group, L.P., as Investment Manager By: -------------------------------------- Name: Robert L. Chender Title: Managing Director PALLADIN OVERSEAS FUND LIMITED By: The Palladin Group, L.P., as Investment Manager By: -------------------------------------- Name: Robert L. Chender Title: Managing Director 7 8 PALLADIN PARTNERS I, L.P. By: Palladin Asset Management, LLC as Investment Manager By: -------------------------------------- Name: Title: LANCER SECURITIES (CAYMAN) LIMITED By: The Palladin Group, L.P., as Investment Manager By: -------------------------------------- Name: Robert L. Chender Title: Managing Director PGEP III, LLC By: The Palladin Group, L.P., as Investment Manager By: -------------------------------------- Name: Robert L. Chender Title: Managing Director QUATTRO FUND LIMITED By: Quattro Investors LP By: -------------------------------------- Name: Andrew Kaplan Title: Principal 8 9 SCHEDULE I Halifax Fund, L.P. The Gleneagles Fund Company Palladin Overseas Fund Limited Palladin Partners I, L.P. Lancer Securities (Cayman) Limited PGEP III, LLC Quarrto Fund Limited 9 10 EXHIBIT "F" ABLE TELCOM HOLDING CORP. PROXY I appoint Michael Brenner and Edward Z. Pollock, or either one, the undersigned's proxy to vote all of its shares of common stock of Able Telcom Holding Corp. that are entitled to vote at any meeting of Able Telcom Holding Corp. shareholders called to approve the Shareholder Proposals (as defined in Amendment No. 1 to Able Telcom Holding Corp. Series C Convertible Preferred Stock Purchase Agreement and Related Agreements dated as of July 7, 2000, including the proposal to issue to Sirit Technologies shares of Common Stock pursuant to the Settlement Agreement dated July 7, 2000 (the "Sirit Agreement") between the "Sirit Parties" and the "Able Parties"; as each of those terms is defined in the Sirit Agreement, a copy of which Sirit Agreement is attached as Exhibit "A," in favor of the Shareholder Proposals. This proxy shall expire and be of no further force and effect after December 1, 2000. - ----------------, -------- (Complete above date and sign your name as it appears below. If more than one name appears, each person should sign). ------------------------------------- By: --------------------------------- Name: ------------------------------- Its: -------------------------------- Number of shares of common stock ------------------------------------- 10 EX-10.52 5 ex10-52.txt SETTLEMENT AGREEMENT 1 EXHIBIT 10.52 SETTLEMENT AGREEMENT This is an agreement ("Agreement") between the Sirit Parties (as defined below) and the Able Parties (as defined below) dated as of this 7th day of July 2000. The Sirit Parties and the Able Parties wish to resolve any and all disputes between any and all of the Sirit Parties, on the one hand, and any and all of the Able Parties, on the other hand, without further litigation, and, in consideration of the mutual promises and covenants, payments, warranties, releases, and agreements contained in this Agreement, and other good and valuable consideration, the sufficiency of which is acknowledged, the Sirit Parties and the Able Parties covenant and agree as follows: I. DEFINITIONS. The following terms used are defined as follows: A. "Able" means Able Telcom Holding Corp. and its predecessors, successors, acquirers and assigns, and each of their present, past, direct and indirect subsidiary, parent, and affiliated entities, past and present employees, agents, representatives, directors, employees, officers, shareholders, partners, joint venturers, and any other persons acting or purporting to act on behalf of Able Telcom Holding Corp., except legal counsel. Notwithstanding the foregoing, "Able" does not include Thomas M. Davidson, Sr. B. "Able Parties" means Able Telcom Holding Corp., Thomas M. Davidson, Sr. ("Davidson"), MCI WorldCom, Inc., MFS Communications Company., Inc., WorldCom, Inc., Frederick Weidinger and their predecessors, successors, acquirers and assigns, and each of their present, past, direct and indirect subsidiary, parent, and affiliated entities, past and present employees, agents, representatives, directors, employees, officers, shareholders, partners, joint venturers, and all of said individuals' heirs, executors, administrators and assigns and any other persons acting or purporting to act on behalf of the Able Parties including but not limited to those individuals and entities listed on Exhibit "A" to this Agreement, except legal counsel. C. "Agreement" means this agreement. D. The "Able Litigation" means Sirit Technologies, Inc. v. Able Telcom Holding Corp. et al., U.S. District Court of the Southern District of Florida, Case No. 98-1153-CIV-GOLD. E. "Defendants" means Able Telcom Holding Corp. and Thomas M. Davidson, Sr., and does not include any of the additional individuals or entities included in the defined terms "The Able Parties" or "Able." F. "Plaintiff" means Sirit Technologies, Inc. and does not include any of the additional individuals or entities included in the defined terms "The Sirit Parties" or "Sirit." 1 of 22 2 G. "Series B" means the Series B Convertible Preferred Stock as such shares remain and are described on pp. 16-18 of Able Telcom Holding Corp.'s Form 10-Q filed with the SEC on or about June 19, 2000. H. "Series C" means those 5,000 (Five Thousand) shares of Series C Convertible Preferred Stock issued by Able on or about February 4, 2000. I. "Signature Parties" shall mean Able Telcom Holding Corp., Thomas M. Davidson, Sirit Technologies, Inc., Jacob Gornitzki and GTL Securities, Inc. J. "Sirit" means Sirit Technologies, Inc. and its predecessors, successors, acquirers and assigns, and each of their present, past, direct and indirect subsidiary, parent, and affiliated entities, past and present employees, agents, representatives, directors, employees, officers, shareholders, partners, joint venturers, and any other persons acting or purporting to act on behalf of Sirit Technologies, Inc., except legal counsel. K. "Sirit Parties" means Sirit Technologies, Inc., Jacob Gornitzki, GTL Securities, Inc. and their predecessors, successors, acquirers and assigns, and each of their present, past, direct and indirect subsidiary, parent, and affiliated entities, past and present employees, agents, representatives, directors, employees, officers, shareholders, partners, joint venturers, and all of said individuals' heirs, executors, administrators and assigns and any other persons acting or purporting to act on behalf of the Sirit Parties, including but not limited to those individuals and entities listed on Exhibit "B" to this Agreement, except legal counsel. L. The "Surviving Sections" are Sections IV, V, VI, VIII, IX, X, XII, XIII, XIV, XV and XVI. M. The "WorldCom Litigation" means Sirit Technologies, Inc. and GTL Securities Inc. v. MCI WorldCom, Inc. et al, U.S. District Court for the District of Nebraska, Case No. 8:00CV92, dismissed without prejudice on March 14, 2000. II. SETTLEMENT TERMS A. FUND TRANSFERS ON EXECUTION. 1. Davidson shall cause Sirit to be paid a nonrefundable payment totaling $650,000 (Six Hundred and Fifty Thousand Dollars), as consideration for Sirit's agreement to settle any and all litigation matters between Sirit and Davidson and in consideration of Sirit's execution of this Agreement with the releases contained herein. Payment shall be by certified check or other good funds, including wire transfer to counsel for Sirit by 12:00 Noon, July __, 2000. Davidson agrees not to directly or indirectly seek indemnification from Able (or Able's insurance carrier(s)) for this $650,000 payment. Able agrees not to indemnify or cause the indemnification of Davidson, directly or indirectly, for this $650,000 payment. Except as otherwise provided herein, this payment, and the release of Davidson, is final as of the execution of this Agreement 2 of 22 3 and under no circumstances shall Davidson be entitled to a return of, or credit for, this $650,000 payment. Davidson represents that this payment is not improper in light of any obligations or liabilities that he may owe to the Internal Revenue Service or any other secured creditor. In the event of an action for disgorgement or otherwise to obtain all or part of the $650,000.00, Davidson agrees to defend that action at his own cost and expense. In the event such payment is finally determined to be improper, and such final determination results in an order requiring Sirit to disgorge or otherwise make a payment, and such payment is made by Sirit, Davidson will have ten (10) business days to make Sirit whole as to any actual amounts disgorged or paid plus interest thereon, calculated at the annual rate of 10% compounded monthly, and if he does not do so, Sirit may execute upon the Consent Judgment described in Section III. Notwithstanding the foregoing, Sirit agrees to execute and file a Notice of Satisfaction of the Consent Judgment described in Section III with regard to Davidson, upon the presentation to Sirit of written proof that the outstanding obligations of Thomas Davidson to the IRS and any other secured creditor (excluding any residential mortgage to the extent it is secured by the residential property) as of the date of this Agreement have been settled and satisfied. 2. Able shall cause Sirit to be paid a nonrefundable payment totaling $5,000,000.00 (Five Million Dollars) as consideration for Sirit's execution of this Agreement. Payment shall be by certified check or other good funds, including wire transfer to counsel for Sirit by 12:00 Noon, July __, 2000. This payment is independent of, and unrelated to, any other consideration from Able to Sirit provided for in this Agreement. This payment is final as of execution of this Agreement and under no circumstances shall Able be entitled to a return of or credit for this $5,000,000.00 payment. B. SECURITIES TO BE ISSUED 1. ISSUANCE OF STOCK. Able is to use its best efforts, at its sole cost and expense, to obtain by November 30, 2000 (the "Issue Date") any and all necessary corporate, regulatory and other third party consents to issue and register sufficient common stock equal to 4,074,597 (Four Million, Seventy Four Thousand, Five Hundred Ninety Seven) shares (such shares, together with such other shares to be issued to Sirit as set forth below in this Paragraph B.1 (and not Paragraph B.2.), to be collectively referred to as the "Sirit Shares"), being 19.99% of the outstanding shares of Able after the issuance of these shares, based on 16,308,582 shares outstanding reported in Able's Form 10-Q filed with the SEC on or about June 19, 2000. In addition and subject to the above, Able will issue to Sirit (or, in the alternative, at Sirit's direction, reserve for issuance) upon conversion by the Series C holders an additional 936,914 (Nine Hundred Thirty Six Thousand Nine Hundred and Fourteen) shares of common stock (assuming the Series C shares have a $15 million face value and are converted at a conversion price of $4/share), without payment of any consideration by Sirit. If the foregoing assumptions are incorrect, appropriate adjustments in the number of 3 of 22 4 shares issued to Sirit will be made, so as to maintain Sirit as the owner of 19.99% of Able's common stock, without payment of any consideration by Sirit. Moreover, to extent that the holders of Series B or Series C, now have, pursuant to an existing document or agreement (including the amendments attached as Exhibit C), and pursuant to the terms of Section II, Paragraph B.2 below, (i) An entitlement to additional shares and/or warrants, including, without limitation, as a result of any penalty, damage, default, conversion, put or other right, then Sirit shall be entitled, without payment of any consideration (unless additional consideration is at that time paid to receive the shares from the entitlement) to be issued (or alternatively, at Sirit's direction to have reserved for issuance), at such a time that such shares are issued to the holders of Series B or Series C, on a simultaneous basis, additional shares so that Sirit shall retain its 19.99% ownership interest in Able, and/or (ii) An entitlement to any moneys, including, without limitation, as a result of any penalty, damage, default, conversion, put or other right, then Sirit shall (a) not be required to transfer, convey, assign or return any of its Sirit Shares back to Able or any other party and (b) be issued (or alternatively, at Sirit's direction to have reserved for issuance), at such a time that such shares are issued to the holders of Series B or Series C, additional shares without payment of any consideration by Sirit (unless additional consideration is at that time paid to receive the shares from the entitlement) in an amount equal to the excess of such moneys over $15 million divided by $4 per share; and/or (iii) In the event any shares to which Sirit is entitled pursuant to (i) or (ii) above would raise its ownership of the outstanding common stock of Able above 19.99%, Sirit shall have the right to such shares, but such shares shall be issued to Sirit only upon its written instructions. Able is to use its best efforts, at its sole cost and expense, to obtain by November 30, 2000 (the "Issue Date") any and all necessary corporate, regulatory and other third party consents to issue and register sufficient common stock equal to the sum of the shares to be issued to Sirit pursuant to the preceding two paragraphs (a total of 5,011,511 shares of common stock). Ninety-one days following the issuance and registration of the Sirit Shares, and assuming that Able has met all conditions of Section XI and XII (with the exception of the two-year period described therein), and also assuming that no petition commencing a bankruptcy case has been filed by or against Able, Sirit shall file a Notice of Satisfaction of the Consent Judgment referred to in Section III with the Court. If, regardless of Able's efforts, these shares are not issued and registered (See Section II, Paragraph B.3 below) 4 of 22 5 on or before November 30, 2000, Sirit may, upon five (5) business days notice to Able, execute upon the Consent Judgment, pursuant to the other terms and conditions of this Agreement, including those terms contained in Sub-Paragraph 7 below. 2. ANTI-DILUTION. Sirit shall have the right to maintain its then current percentage ownership of the outstanding shares of Able common stock attributable to Sirit's ownership of the Sirit Shares on the Issue Date. Accordingly, if Able issues shares of common stock to any third party except in the case of the Series B and/or C Conversion, in which case no payment is due from Sirit, Sirit is entitled to receive the appropriate number of shares of stock that will maintain its then current percentage ownership of common shares originally attributable to Sirit's ownership of the Sirit Shares, provided that Sirit pay the same consideration paid to Able by the third party. By way of example, if Sirit's current holdings of shares of Able common stock attributable to Sirit's ownership of the Sirit Shares on the Issue Date is 19.99%, and if an option holder exercises options and buys 80 shares at $5.00 per share, then Sirit shall be given the right to purchase 20 shares at $5.00 per share. The mere issuance of options (or any other right to receive common shares) to a third party does not permit Sirit to acquire additional shares, provided the issuance of the options (or other rights to receive common shares) does not entitle the recipient to voting rights. Only the exercise of such options (or other rights to receive common shares) requires Able to offer such shares to Sirit at the appropriate price. If Sirit's current holdings of Able common stock attributable to Sirit's ownership of the Sirit Shares on the Issue Date during the term of this agreement become 10%, for example, then if an option holder exercises options and buys 90 shares at $5.00 per share, Sirit shall be given the right to purchase 10 shares at $5.00 per share. Able shall provide Sirit 30 days written notice of the issuance of common shares and/or exercise of the options (or any other right to receive common shares)during which time Sirit shall have the right to purchase pursuant to this Paragraph B.2. If Sirit chooses not to exercise its right to purchase any or all such shares, resulting in a reduction of the percentage of common shares of Able common stock attributable to Sirit's ownership of the Sirit Shares on the Issue Date, then the number of shares available to Sirit thereafter under this Paragraph B.2 shall decrease to that resulting percentage. Only the Sirit Shares, and shares obtained pursuant to Paragraphs B.1 and B.2, shall be counted toward Sirit's percentage. The provisions of this Paragraph B.2 expire two years after the issuance of the Sirit Shares, and do not apply to any issuance of shares under which Able shall receive value of $10.00 per share or more. However, to the extent the issuance of shares at $10.00 per share or more causes a reduction in Sirit's percentage attributable to Sirit's ownership of the Sirit Shares on the Issue Date, that reduced percentage ownership shall be used thereafter under the provisions of this Paragraph B.2. All shares issued pursuant to this Paragraph B.2 shall be called the "Anti-Dilution Shares." 5 of 22 6 3. REGISTRATION RIGHTS. Able will use its best efforts to ensure that Sirit will have "piggyback" SEC registration rights for the Sirit Shares with the holders of Series B and/or C Preferred Shares. In particular, Able agrees to file an S1 by August 31, 2000 for the Sirit Shares and to use its best efforts for such registration to become effective by the same date that is required by the Series C registration rights agreements as amended and attached hereto as Exhibit "C" and under the same terms and conditions contained in those documents. In the event that Sirit is entitled to Anti-Dilution Shares during the two years following issuance of the Sirit Shares, Able will undertake to make prompt regulatory filings in order to register the additional shares. 4. SIRIT'S SECURITIES REPRESENTATIONS AND WARRANTIES. Sirit represents and warrants that it is an "accredited investor," as such term is defined in Regulation D promulgated by the Securities and Exchange Commission under the Securities Act of 1933 and as evidenced by the following (a) Sirit was not formed for the purpose of investing in the Sirit Shares; (b) Sirit (1) is (i) a bank, (ii) an insurance company, (iii) an investment company registered under the Investment Company Act of 1940, (iv) a business development company as defined in the Investment Company Act of 1940, (v) a small business investment company licensed by the Small Business Administration, (vi) a private business development company as defined in the Investment Advisors Act of 1940, or (vii) a broker or dealer registered pursuant to Section 15 of the Securities Exchange Act of 1934.; or (2) has assets in excess of $5,000,000 in value; or (3) all of the equity owners of Sirit are Accredited Investors under the Act and Regulation D; or (4) is a revocable trust which may be amended or revoked at any time by the grantors. Each of the grantors individually is an Accredited Investor under the Act and Regulation D; or (5) is an employee benefit plan trust under Title I of the Employee Retirement Income Security Act of 1974, as amended ("ERISA"), and either (i) the investment decision with respect to this investment is being made by a bank, insurance company or registered investment adviser as the plan fiduciary, or (ii) the plan is self-directed and investment decisions are made by persons who are Accredited Investors under the Act and Regulation D. (c) Sirit has the knowledge and experience in financial, tax, and business matters required to enable it to utilize the information made available to it in connection with the offering of 6 of 22 7 the Shares, to evaluate the merits and risks of the prospective investment, and to make an informed business decision with respect to it; (d) Sirit's investment in the Sirit Shares is suitable for the undersigned when viewed in the light of its other securities holdings and needs; (e) Sirit has adequate means of providing for its current needs and contingencies and has no need for liquidity in its investment in the Shares; and (f) Sirit will notify Able immediately if any of these representations become untrue prior to Sirit's acceptance of the Sirit Shares. 5. BOARD REPRESENTATION. Until such time as the Sirit Shares are issued, one representative of Sirit shall receive notice of, and shall have the right to attend and observe all Able board meetings at Able's expense. After such time as the Sirit Shares are issued, Able shall include one nominee of Sirit for election to the Board of Directors to be confirmed in Able's annual shareholders meeting. 6. ABLE'S RELATED UNDERTAKINGS. Able, but not Davidson, as a condition of this Agreement, within 20 business days of the execution of this Agreement, will obtain and provide documentary verification to Sirit of each of the following, among others (see Section XI): (a) written agreements from MCI WorldCom, Gideon Taylor and the holders of Series B and Series C to vote their common shares in favor of the issuance of the Sirit Shares and any related matters to this Settlement Agreement at the next Able annual shareholder meeting; (b) withdrawal of the Supplemental Compensation arrangement (approved by the Board of Directors on March 31, 2000) from the items to be presented for approval at the next shareholders meeting of the Company; (c) reservation of such amount of authorized but unissued common shares in favor of Sirit to maintain Sirit's then current percentage ownership as discussed in Section II, Paragraphs B.1 and B.2 above in Able upon conversion of all Series C. 7. NATURE OF REMEDY PROVISIONS. a. From the date of this Agreement, through and including August 31, 2000, Able may cause Sirit to be paid $20 million in cash or equivalent funds, for any reason. Ninety-one days following this payment, and assuming that Able has met all of the obligations of Section XII (with the exception of the two-year period described therein), and also assuming that no petition commencing a bankruptcy case has been filed by or against Able, then the $20 million payment shall be deemed a discharge of every obligation of Able under this Agreement except for those contained in the Surviving Sections, and Sirit shall file the dismissal with prejudice of the WorldCom Litigation pursuant to Section III and, a Notice of Satisfaction of the Consent Judgment in the Able Litigation pursuant to Section III. During that 91 day period, all obligations of Able under this Agreement shall be held in suspense. 7 of 22 8 b. If, during the time from September 1, 2000, through and including November 30, 2000 (the "Interim Period"), Able enters into an agreement to merge into, be acquired by, or otherwise transfer all or substantially all of its assets to another entity (the "Entity") with which it is not then affiliated (the "Triggering Transaction") then Able shall provide a copy of this Agreement to the Entity and: (1) Able shall provide written notice of the Triggering Transaction to Sirit; and (2) Thereafter, Sirit shall have ten (10) business days from the notice (as defined in Section XVI, below) to make an election between: (a) participating in the Triggering Transaction as described below; or (b) otherwise continuing with its rights under this Agreement. (3) If Sirit elects to participate in the Triggering Transaction, then (subject to Sub-Paragraph 7.c below), ninety-one days following this election, and assuming that Able has met all of the obligations of Section XII (with the exception of the two-year period described therein), and also assuming that no petition commencing a bankruptcy case has been filed by or against Able, then Sirit's election shall be deemed a discharge of every obligation of Able under this Agreement except for those contained in the Surviving Sections, and Sirit shall file the dismissal with prejudice of the WorldCom Litigation pursuant to Section III and, a Notice of Satisfaction of the Consent Judgment in the Able Litigation pursuant to Section III. During that 91 day period, all obligations of Able under this Agreement shall be held in suspense. (4) Sirit shall participate in the Triggering Transaction entered into during the Interim Period by receiving the same consideration offered in the Triggering Transaction as all other common shareholders, as if Sirit owned its full entitlement to its Sirit Shares pursuant to this Agreement of the outstanding common shares of Able in the Triggering Transaction. However, under no circumstances will the total amount to be paid to Sirit from a Triggering Transaction entered into during the Interim Period exceed $26.2 million (unless the Triggering Transaction occurs after Sirit receives the Sirit Shares), not including the $5 million inducement payment made pursuant to Section II.A.2 of this Agreement. Further, if the consideration given to Sirit is in the form of securities, those securities will be valued (for the purpose of calculating the $26.2 million limit) at their closing trading price on the date of the closing of the Triggering Transaction. 8 of 22 9 c. If, pursuant to Sub-Paragraph (2)(a) above, Sirit elects to participate in the Triggering Transaction, and if the Triggering Transaction does not close before December 1, 2000, then on or before December 11, 2000, Sirit shall again elect between participating in the Triggering Transaction as described above or otherwise continuing with its rights under this Agreement. However, if Sirit elects to participate in the Triggering Transaction under this Sub-paragraph c, then such election is irrevocable, and ninety-one days following this election, and assuming that Able has met all of the obligations of Section XII (with the exception of the two-year period described therein), and also assuming that no petition commencing a bankruptcy case has been filed by or against Able, then this election shall be deemed a discharge of every obligation of Able under this Agreement except for those contained in the Surviving Sections, and Sirit shall file the dismissal with prejudice of the WorldCom Litigation pursuant to Section III and, a Notice of Satisfaction of the Consent Judgment in the Able Litigation pursuant to Section III. During that 91 day period, all obligations of Able under this Agreement shall be held in suspense. If Sirit elects under this sub-Paragraph c to continue with its rights under this Agreement, then all unperformed obligations under this Agreement are reinstated except that any payment obligation will be delayed for 30 days after Sirit's election. d. The closing of any Triggering Transaction in which Sirit has elected to participate, discharges every obligation of Able under this Agreement except for those contained in the Surviving Sections and requires Sirit to file the dismissal with prejudice of the WorldCom Litigation pursuant to Section III. III. RESOLUTION OF PROCEDURAL ISSUES. Upon execution of this Agreement, Able, Sirit, Davidson and their counsel will execute and file with the Court in the Able Litigation the attached Notice of Settlement and Joint Motion to Enter Consent Judgment, which grants judgment to Sirit and against Able in the amount of $20 million, and to Sirit and against Davidson in the amount of $1.3 million. Once the Consent Judgment is entered, Sirit must in every and any jurisdiction in which it has recorded the May 16, 2000 judgment in the Able Litigation, take all steps required under the law of those jurisdictions to remove or cancel from the public records any indication that the May 16, 2000 judgment in the Able Litigation has any current vitality, force or effect. Sirit may choose at its own option and expense to record the new $20 million Consent Judgment, but in any event may not execute upon it except as provided elsewhere in this Agreement. Further, and subject to the provisions of Section II, Paragraph B.7, Sirit must provide Able five (5) business days notice of any such intended execution so that Able may at its sole option and for any reason cure the breach during the five business day cure period or pay the Consent Judgment before execution is commenced. Notwithstanding any other provision of this Agreement, any event that gives Sirit the right to execute upon the $20 million Consent Judgment (including the expiration of the 5-day period without cure or payment) shall also give Sirit any right it then may have to reinstitute the WorldCom Litigation. In such an event, the releases provided to Frederick W. Weidinger, 9 of 22 10 WorldCom Inc., MCI WorldCom, Inc. and MFS Communications Company, Inc. (the "WorldCom Parties") in Section IV become null and void only to the extent that the Sirit Parties are permitted to refile the WorldCom Litigation subject to the conditions set forth herein, and the releases provided by the WorldCom Parties shall also become null and void only with respect to the subject matters raised in or related to the WorldCom Litigation. The Sirit Parties agree that should the WorldCom Litigation be reinstated pursuant to the terms of this paragraph, then the WorldCom Litigation shall be the sole remedy of the Sirit Parties against the WorldCom Parties with respect to the subject matters raised therein and that the WorldCom Litigation shall be limited to the subject matters contained in the legal claims and factual allegations set forth in the complaint previously filed in the WorldCom Litigation, except as to events arising after the date of this Agreement. However, until such time, and consistent with Section IV, Sirit will refrain and forbear from commencing, instituting, or prosecuting any lawsuit, action, claim, petition, motion or other judicial or regulatory proceeding based on, arising out of, or connected with the WorldCom Litigation or the subject matters raised therein. In the event that the $20 million Consent Judgment is satisfied either by the issuance and registration of the Sirit Shares, or payment in full within 45 days, or otherwise pursuant to the terms of Section II, Paragraph B.7, then all Sirit Parties who are Plaintiffs in the WorldCom Litigation shall dismiss the WorldCom Litigation with prejudice after ninety-one days have thereafter elapsed without the filing of a petition by or against Able commencing a bankruptcy case. However, any statutes of limitations applicable to the WorldCom Litigation (including those applicable to claims that may be asserted against the Sirit Parties) are tolled from the date of the full execution of this Agreement until the date of any event (not cured or waived pursuant to Section IX) that gives Sirit the right to execute upon the $20 million Consent Judgment. If a petition by or against Able commencing a bankruptcy case is filed within this 91 day period and if a claim is made that the satisfaction of the Consent Judgment is a preference or must otherwise be disgorged or repaid, then the Sirit Parties will forbear from commencing litigation against the WorldCom Parties unless and until the satisfaction of the Consent Judgment is finally determined by the courts to be a preference or otherwise required to be disgorged or repaid by Sirit; provided, that during this period of forbearance any statutes of limitation applicable to the WorldCom Litigation (including those applicable to claims that may be asserted against the Sirit Parties) are tolled and extended. If, however, the courts finally determine that the satisfaction of the Consent Judgment is not a preference and need not be repaid or otherwise disgorged, then the Sirit Parties who are Plaintiffs in the WorldCom Litigation shall dismiss the WorldCom Litigation with prejudice within five (5) business days following the final adjudication. Provided further that Sirit agrees to exchange unconditional releases with WorldCom if, within 20 days of the execution of this Agreement, WorldCom pays Sirit $10 million. IV. MUTUAL GENERAL RELEASES AND COVENANTS NOT TO SUE. Except as otherwise provided in this Agreement, the Sirit Parties (collectively and individually) hereby GENERALLY AND UNCONDITIONALLY RELEASE, acquit, and forever discharge the Able Parties (collectively and individually) from any and all claims, demands, actions, indebtedness, agreements, promises, causes of action, claims for attorneys' fees, costs, responsibilities, obligations, expenses, covenants, damages, suits, judgments and liabilities of any nature whatsoever, in law or in equity, whether or not known, suspected, 10 of 22 11 claimed, developed or undeveloped, anticipated or unanticipated that the Sirit Parties (collectively or individually) ever had, claimed to have, now have, or may hereafter have or claim to have, based upon events that occurred through the date of this Agreement, against each or any of the Able Parties, including but not limited to, all claims arising out of, connected with, incidental to, asserted in, or which could have been asserted in or are related to the Able Litigation or the WorldCom Litigation, or otherwise arise out of any aspect whatsoever of any relationship or dealing between any or all the Sirit Parties and any or all the Able Parties. It is understood that this is a General Release. Except as otherwise provided in this Agreement, the Sirit Parties (collectively and individually) hereby agree and covenant that the Sirit Parties will forever refrain and forbear from commencing, instituting, or prosecuting any lawsuit, action, claim, petition, motion or other judicial or regulatory proceeding based on, arising out of, or connected with any of the released claims referenced in the preceding paragraph. Except as otherwise provided in this Agreement, the Able Parties (collectively and individually) hereby GENERALLY AND UNCONDITIONALLY RELEASE, acquit, and forever discharge the Sirit Parties (collectively and individually) from any and all claims, demands, actions, indebtedness, agreements, promises, causes of action, claims for attorneys' fees, costs, responsibilities, obligations, expenses, covenants, damages, suits, judgments and liabilities of any nature whatsoever, in law or in equity, whether or not known, suspected, claimed, developed or undeveloped, anticipated or unanticipated that The Able Parties (collectively or individually) ever had, claimed to have, now have, or may hereafter have or claim to have, based upon events that occurred through the date of this Agreement, against each or any of the Sirit Parties, including but not limited to, all claims arising out of, connected with, incidental to, asserted in, or which could have been asserted in or are related to the Able Litigation or the WorldCom Litigation, or otherwise arise out of any aspect whatsoever of any relationship or dealing between any or all of the Able Parties and any or all of the Sirit Parties. It is understood that this is a General Release. The Able Parties (collectively and individually) hereby agree and covenant that the Able Parties will forever refrain and forbear from commencing, instituting, or prosecuting any lawsuit, action, claim, petition, motion or other judicial or regulatory proceeding based on, arising out of, or connected with any of the released claims referenced in the preceding paragraph. V. COST OF LITIGATION AND ATTORNEYS' FEES. The Sirit Parties and the Able Parties understand that they are each responsible for their own attorneys' fees, costs and expenses arising out of the Able Litigation and the WorldCom Litigation including the fees, costs and expenses of their own expert witnesses. VI. NO ASSIGNMENT. The Sirit Parties and the Able Parties represent and warrant that as of the date of the execution of this Agreement, they have not assigned or transferred, or purported to assign or 11 of 22 12 transfer, to any person, firm, corporation, association or entity whatsoever, any released claim described in Section IV. VII. NO ADMISSION OF LIABILITY. This Agreement is a compromise of disputed claims and does not constitute, nor shall it be construed, as an admission of liability on the part of the Sirit Parties or the Able Parties as to any matters whatsoever. It is understood and agreed that this settlement is the compromise of disputed claims and that each party merely intends to avoid further litigation and buy its peace. VIII. INDEMNIFICATION. Except as otherwise provided herein, in the event any Sirit Party or Able Party institutes any action or proceeding against another Sirit Party or Able Party with respect to any claim and/or action related to the matters raised in the Able Litigation, or in the event any warranty contained in this Agreement is breached, then the individual or entity asserting such claim and action or breaching the warranty shall indemnify and hold harmless the individual or entity against whom the claim is asserted or who claims the warranty is breached with respect to any and all damages, loss, liability or expense of any nature whatsoever, including attorneys' fees and expenses, which the party against whom the claim is asserted or who claims the warranty is breached may incur or suffer arising out of or resulting in any way from such action or breach; provided that in no event shall Sirit have any obligation to indemnify or hold harmless Able or any Able Party as a result of any action by any Sirit Party other than Sirit; nor shall Able have any obligation to indemnify or hold harmless Sirit or any Sirit Party as a result of any action by any Able Party other than Able. IX. MODIFICATION, WAIVER AND NO PAROL REPRESENTATIONS OR AGREEMENTS. This Agreement constitutes the entire Agreement between the Sirit Parties and the Able Parties with respect to the subject matter hereof and supersedes all prior and contemporaneous oral and written agreements and discussions. No provision of this Agreement may be changed, altered, modified, or waived except in writing signed by all Signature Parties other than Davidson, except as to matters directly impacting Davidson's rights, duties or obligations under this Agreement. The Sirit Parties and the Able Parties acknowledge that no representation, promise or inducement has been made with respect to the subject matter hereof other than as specifically set forth in this Agreement, and that none of them has entered into this Agreement in reliance upon any other representation, promise or inducement with respect to the subject matter hereof not set forth herein. Any decision or agreement by any Signature Party to waive or not enforce any conditions or obligations under this Agreement, or to extend any time period under this Agreement, shall not act as a a waiver of any rights of that Signature Party under this Agreement with respect to any condition or obligation or with respect to any other breach of obligations under this Agreement. 12 of 22 13 X. REPRESENTATIONS AND WARRANTIES OF UNDERSTANDING. All Signature Parties acknowledge and represent that they have read this Agreement in full, have consulted with their attorneys, and understand and voluntarily consent and agree to each and every provision contained herein. All Signature Parties hereto have cooperated in the drafting and preparation of this Agreement, which Agreement was custom-drafted to represent the unique needs of the situation between these parties. Sirit and Able represent and warrant that, among them, they have authority to enter into this Agreement on behalf of all the Sirit Parties and all the Able Parties respectively. Additionally, any Signature Party that is not an individual represents and warrants that the individual signing on its behalf has all necessary power and authority to do so. Except as otherwise provided in this Agreement, Sirit and Able represent and warrant that all claims, demands, actions, indebtedness, agreements, promises, causes of action, claims for attorneys' fees, costs, responsibilities, obligations, expenses, covenants, damages, suits, judgments and liabilities of any nature whatsoever, in law or in equity, whether or not known, suspected, claimed, developed or undeveloped, anticipated or unanticipated that the Sirit Parties and/or the Able Parties (collectively or individually) ever had, claimed to have, now have, or may hereafter have or claim to have, based upon events that occurred through the date of this Agreement, against each other, including but not limited to, all claims arising out of, connected with, incidental to, asserted in, or which could have been asserted in or are related to the Able Litigation or the WorldCom Litigation or otherwise arise out any aspect whatsoever of any relationship or dealing between any or all the Able Parties and any or all the Sirit Parties, have fully matured before the Effective Date of this Agreement. Sirit and Able represent and warrant that the descriptions by category of the individuals and entities included in the definitions of "The Sirit Parties" and "The Able Parties" are sufficient to describe those categories, and, that the lists of the Sirit Parties and the Able Parties contained in Exhibits A and B are merely exemplary and are non-exhaustive. Sirit and Able each represent that, excluding legal fees paid to counsel, no one has been paid, or is entitled to a payment of, a commission, contingency fee, success fee or incentive for the procurement or execution of this Agreement. XI. CONDITIONS. Except as otherwise provided herein, including in Section II, Paragraph B.7, failure of Able to perform any of the following conditions permits Sirit to execute upon the $20 million Consent Judgment against Able, pursuant to the terms and conditions of this Agreement, but do not impact the rights of Davidson or his release herein. A. Within 20 business days after the execution of this Agreement, Able will provide to Sirit an agreement between WorldCom and Able which will provide for the following: 13 of 22 14 1. WorldCom will agree to convert all of its holdings of current debt into seven year term debt at an annual interest rate not to exceed 8%; 2. WorldCom will agree to extend the Master Services Agreement to July 1, 2006 maintaining current annual minimum contract amounts; 3. WorldCom will use reasonable efforts to assist Able to raise working capital and expects to provide new working capital up to a maximum amount of $40,000,000; 4. WorldCom will agree to vote its common shares in favor of the issuance of the Sirit Shares and any matters related to this Settlement Agreement; 5. WorldCom will agree not to place Able in involuntary bankruptcy from the date of this Agreement until (a) 91 days following the issuance and registration of the Sirit Shares; or (b) for 91 days following the date on which the Consent Judgment has been paid or satisfied in full, whichever is later (but in no event later than May 31, 2001); 6. WorldCom will agree to the tolling of the statute of limitations as described at the end of Section III. B. PREFERRED SERIES B AND C CONDITIONS. Within 20 business days after the execution of this Agreement, Able will provide to Sirit signed copies of the agreements between the holders of Series B and Series C and Able, which are attached as Exhibit C. Additionally, the holders of Series B and Series C will agree not to place Able in involuntary bankruptcy from the date of this Agreement until (a) 91 days following the issuance and registration of the Sirit Shares; or (b) for 91 days following the date on which the Consent Judgment has been paid or satisfied in full, whichever is later, (but in no event later than May 31, 2001), to the extent they have such a right, and will agree to vote their common shares in favor of the issuance of the Sirit Shares and any matters related to this Settlement Agreement. C. LENDER CONDITIONS. Within 20 business days after the execution of this Agreement, Able will make its best efforts to provide to Sirit an agreement between Bank of America and Able which will provide that Bank of America will not place Able in involuntary bankruptcy from the date of this Agreement until (a) 91 days following the issuance and registration of the Sirit Shares; or (b) for 91 days following the date on which the Consent Judgment has been paid or satisfied in full, whichever is later, (but in no event later than May 31, 2001), to the extent it has such a right, upon the condition that Able satisfies its obligations to Bank of America under its agreements with Bank of America. D. TAYLOR CONDITIONS. Within 20 business days after the execution of this Agreement, Able shall provide to Sirit an agreement between Gideon Taylor and Able 14 of 22 15 which will provide that Taylor will agree to vote any common shares he may have in favor of the issuance of the Sirit Shares and any matters related to this Settlement Agreement. E. All of the obligations contained in Section II.B, "Securities to be Issued," regarding the Issuance of Stock, Anti-Dilution, Board Representation, Registration Rights, Able's Related Undertakings and Nature of Remedy Provisions are also, without changing the meaning or scope of those obligations, to be treated as conditions under this Section XI. XII. INSOLVENCY PROVISIONS. Able represents that it does not have any present intention to file a voluntary bankruptcy case during the two-year period following the date of the entry of the Consent Judgment described in Section III above and that it will not file such a case before the end of that two-year period. In the event a petition commencing a bankruptcy case is filed by or against Able, and Sirit is required to return the cash or the securities transferred in settlement of the litigation, then, in such event, Sirit shall have in Able's bankruptcy case an allowed claim of $31.2 million, plus the cost and expenses incurred by Sirit in recording or removing the judgment entered on May 16, 2000 from the public record and the Consent Judgment as described in Section III above, and the reasonable attorneys fees incurred by Sirit in connection therewith. XIII. DISCLOSURE. Sirit and Able agree not to make any disclosure of this agreement unless such disclosure is in a form acceptable to Sirit and Able acting reasonably. Notwithstanding the foregoing, the Able and Sirit Parties acknowledge that each is a public company and, in certain circumstances, may be required to make disclosure as required by securities laws or regulations or as otherwise may be required by law or court order. XIV. VENUE, JURISDICTION AND GOVERNING LAW. The sole jurisdiction and venue for any litigation arising from or related to this Agreement shall be in the United States District Court for the Southern District of Florida, and all Signature Parties agree to submit to jurisdiction of and venue in such court for purposes of such litigation only and all parties agree that the court that conducted the Able Litigation, and which is being asked to approve the Consent Judgment, shall retain jurisdiction over this Agreement. This Agreement shall be performed, construed and governed by the laws of the State of Florida, without regard to Florida's choice of law principles. XV. OUTSTANDING COMMERCIAL TRANSACTIONS. Sirit and Able acknowledge that, independent of this Agreement and the Able Litigation, they have a commercial relationship in which Sirit sells transponders to a subsidiary of Able. Nothing in this Agreement, including the provisions of Section IV, shall release any claim 15 of 22 16 arising out of that commercial relationship, including but not limited to outstanding issues and amounts arising out invoice numbers 10291, 10295-99, 10300, 10303-04, 10306-08, 10317-20, 10322-24, 10326 and 10330 under which Sirit contends that the outstanding total amount is $201,178.89. XVI. NOTICES. Any notice required by the terms of this Agreement shall be effective upon receipt, which shall be presumed one business day after delivery by overnight delivery service, or three business days after delivery by U.S. Mail, postage pre-paid and addressed as follows: To Able: Billy V. Ray, Jr. Chief Executive Officer Able Telcom Holding Corp. 1000 Holcomb Woods Pkwy Suite 440 Roswell, GA 30076 (770) 993-1570 (Phone) (770) 993-8532 (Fax) With a copy to: J. Allen Maines, Esq. Paul Hastings Janofsky & Walker, LLP 600 Peachtree Street Suite 2400 Atlanta, Georgia 30308 (404) 815-2400 (Phone) (404) 815-2424 (Fax) To Davidson: Thomas M. Davidson, Sr. 10509 MacArthur Blvd. Potomac, Maryland, 20854 With a copy to: Edward F. Schiff, Esq. Schnader, Harrison, Segal & Lewis, LLP 1300 I Street, N.W. 11th Floor, East Washington, D.C. 20005 (202) 216-4208 (Phone) (202) 775-8741 (Fax) 16 of 22 17 To Sirit, Gornitzki and GTL Jacob Gornitzki Sirit Technologies, Inc. 200 King Street West Suite 2004 Toronto, Ontario, Canada M5H 3T4 (416) 597-1100 (Phone) (416) 597-2818 (Facsimile) With a copy to: N. Richard Janis Janis, Schuelke & Wechsler 1728 Massachusetts Avenue, N.W. Washington, D.C. 20036 (202) 861-0600 (Phone) (202) 223-7230 (Facsimile) XVII. COUNTERPARTS. This Agreement may be executed in counterparts, and each counterpart shall be and constitute a part of this Agreement and all counterparts taken together shall constitute the Agreement, and be binding and effective upon all parties hereto. IN WITNESS THEREOF, the Sirit Parties and the Able Parties have caused this Agreement to be executed by each of them or their duly authorized representatives on the dates hereinafter subscribed. 17 of 22 18 Pursuant to 28 U.S.C. ss.1746 and ss.92.525, Fla. Stat., I declare under penalty of perjury under the laws of the United States of America and the State of Florida that I have read the foregoing Agreement and that the representations and provisions in it are true and correct. SIRIT TECHNOLOGIES, INC. By: ------------------------------- Its: ------------------------------- Executed this ___ day of July, 2000 18 of 22 19 Pursuant to 28 U.S.C. ss.1746 and ss.92.525, Fla. Stat., I declare under penalty of perjury under the laws of the United States of America and the State of Florida that I have read the foregoing Agreement and that the representations and provisions in it are true and correct. GTL SECURITIES, INC. By: ------------------------------- Its: ------------------------------- Executed this ___ day of July, 2000 19 of 22 20 Pursuant to 28 U.S.C. ss.1746 and ss.92.525, Fla. Stat., I declare under penalty of perjury under the laws of the United States of America and the State of Florida that I have read the foregoing Agreement and that the representations and provisions in it are true and correct. JACOB GORNITZKI - ------------------------------ Individually Executed this ___ day of July, 2000 20 of 22 21 Pursuant to 28 U.S.C. ss.1746 and ss.92.525, Fla. Stat., I declare under penalty of perjury under the laws of the United States of America and the State of Florida that I have read the foregoing Agreement and that the representations and provisions in it are true and correct. ABLE TELCOM HOLDING CORP. By: ------------------------------- Its: ------------------------------- Executed this ___ day of July, 2000 21 of 22 22 Pursuant to 28 U.S.C. ss.1746 and ss.92.525, Fla. Stat., I declare under penalty of perjury under the laws of the United States of America and the State of Florida that I have read the foregoing Agreement and that the representations and provisions in it are true and correct. THOMAS M. DAVIDSON - ------------------------------ Executed this ___ day of July, 2000 22 of 22 23 EXHIBIT A Non-Exhaustive Listing of The Able Parties Able ICP, Inc. Able Telcom CA Able Telcom Do Brasil LTDA Able Telcom Holding Corp. Able Telecommunications & Power, Inc. Able Wireless, Inc. Adesta Communications, Inc. f/k/a MFS Network Technologies, Inc. Adesta Transportation, Inc. f/k/a MFS Transportation Services, Inc. Michael Arp Mark Berner Richard A. Boyle James E. Brands Michael Brenner Carroll Capital Group G. Vance Cartee Thomas M. Davidson Davidson Capital Group LLC Davidson Technology Investment Group LLC Frazier L. Gaines Garrison Capital Group Georgia Electric Company J. Barry Hall Edwin Johnson Stacey Jenkins Marshall Capital Group MCI WorldCom, Inc. Alec McLarty MFS Acquisition Company MFS Communications Company, Inc. Patton Management Corp. Edward Z. Pollock Gerald Pye Southern Aluminum and Steel Corp. Specialty Electronic Systems, Inc. Michael A. Summers Gideon Taylor Transportation Safety Contractors, Inc. TransTech, Inc., f/k/a MFS Transtech, Inc. Billy V. Ray Jr. C. Frank Swartz Frederick Weidinger WorldCom, Inc. A - 1 24 EXHIBIT B Non-Exhaustive Listing of The Sirit Parties Michael Briand Jacob Gornitzki Gornitzki, Thompson & Little GTL Investments Corporation GTL Trading Limited GTL Services Ltd. GTL Securities, Inc. Otto Jelinek Ralph Lean Kevin Moersch Sirit Technologies, Inc. Kenneth Smith Fred Veinot 1 EX-99 6 ex99.txt PRESS RELEASE 1 EXHIBIT 99 Able Telcom Holding Corp. 1000 Holcomb Woods Parkway Suite 440 Roswell, GA 30076 (Nasdaq: ABTE) CONTACTS: Edwin D. Johnson James E. Brands President Senior Executive Vice President (770) 993-1570 (770) 993-1570 FOR IMMEDIATE RELEASE July 12, 2000 ABLE TELCOM AND SIRIT TECHNOLOGIES REACH SETTLEMENT AGREEMENT ROSWELL, GA., July 12, 2000 - Able Telcom Holding Corp. (Nasdaq: ABTE) and SIRIT Technologies Inc. (CDN: SIRT) announced today that they have entered into a Settlement Agreement eliminating SIRIT's $31.2 million judgement against the Company. The principal economic terms of the agreement provide for a cash payment of $5 million to SIRIT and for the Company to use its best efforts to obtain shareholder approval for the issuance to SIRIT of approximately 5 million shares of Able common stock, along with the registration of the shares with the SEC, on or before November 30, 2000. In addition, the agreement provides for a Consent Judgment in favor of SIRIT which is satisfied by the issuance of the shares to SIRIT; in the event that shareholder approval and the registration of the shares with the SEC are not obtained by November 30, 2000, the Consent Judgment provides that Sirit is entitled to a cash payment of $20 million. In conjunction with the Settlement Agreement, holders of the Company's convertible preferred stock have agreed to a fixed $4 per share price, with no further reset provisions, for converting the preferred shares to an aggregate of 3,750,000 common shares. The required date for registration of those common shares has been extended from October 31, 2000 until November 30, 2000 and rights to purchase additional shares of convertible preferred stock under the same terms have been eliminated. In exchange for these concessions, the holders of the Company's convertible preferred stock will receive additional warrants to purchase up to 750,000 shares of common stock, one-half at $6 per share and one-half at $8 per share. As with issuance of shares to SIRIT, conversion of the preferred shares is dependent upon shareholder approval of an increase in the number of authorized shares of Company Common Stock by November 30, 2000. Should the increase not be authorized, or the shares not be registered by November 30, 2000, the holders of the preferred shares will be entitled to a cash payment of $18 million. The Company also announced that in connection with the settlement, Able's largest customer and shareholder has agreed to extend its Master Services Agreement with Able to July 1, 2006 and also has agreed to convert all of its current debt holdings of Able, in the principal amount of $36.5 million, into seven-year term debt and to assist Able in its efforts to raise new financing. Billy Ray, Chairman and Chief Executive Officer of Able, stated, "It is with great pleasure and relief that we announce both the settlement of our disputes with SIRIT and the 1 2 tremendous vote of confidence by our biggest customer. I thank our friends at MCI WorldCom and our preferred shareholders for the tremendous effort and cooperation in reaching this agreement. Also, I would be remiss if I did not also thank our employees and our shareholders for their continued support and patience." Able Telcom is the premier provider of innovative, high-value turnkey solutions and services in the design, development, construction and management of large-scale, facilities-based communication networks. Since 1988 the Company has installed more local area network fiber-optic cable in the U.S. than any other company. Able Telcom's customers include emerging telecom service providers, entrepreneurial Internet Service Providers, and many of the world's largest telecommunications companies. ================================================================================ Certain matters discussed in this press release may constitute forward-looking statements within the meaning of the federal securities law. Able Telcom's actual results could differ materially from those anticipated in such forward-looking statements as a result of certain factors, including those detailed from time to time in the Company's reports and filing with the Securities and Exchange Commission. The Company does not undertake to revise, and specifically disclaims any obligation, to publicly release the result of any revisions which may be made to any forward looking statements to reflect the occurrence of anticipated events or circumstances after the date of such statements. 2 -----END PRIVACY-ENHANCED MESSAGE-----