EXHIBIT 10.40
GUARANTY
THIS GUARANTY (this "Guaranty") is executed as of October 27, 2000,
by VIATEL, INC., a Delaware corporation ("Guarantor") to and for the benefit of
CISCO SYSTEMS CAPITAL ("Lessor").
Lessor is party to that certain Master Lease Agreement dated as of
October 27, 2000 (the "Master Agreement") with Viatel U.K. Limited, a
corporation existing under the laws of the United Kingdom ("Lessee"), and has
entered into or may hereafter enter into certain Schedules (the "Schedules")
relating to and incorporating by reference such Master Agreement in connection
with the leasing or financing of equipment thereunder (such Schedules, together
with the Master Agreement, collectively referred to herein as the "Leases").
Capitalized terms not otherwise defined herein have the meanings specified in
the Leases. In order to be assured of payment under the Leases, Lessor desires
that Guarantor guarantee the payment and other obligations and liabilities of
Lessee to Lessor as set forth herein. Guarantor will derive substantial direct
and indirect benefits from the extension of credit to Lessee (which benefits are
hereby acknowledged by the Guarantor). Accordingly, to induce Lessor to extend
credit to, and to contract with, Lessee, and in consideration thereof, Guarantor
hereby agrees as follows:
1. Guarantor hereby irrevocably and unconditionally guarantees, as
primary obligor and not as a surety merely, without offset or deduction, the due
and punctual payment when due (whether at stated maturity, declaration,
acceleration, demand or otherwise) and performance by Lessee of all the
indebtedness, liabilities and other obligations of Lessee now or hereafter
arising under or in connection with the Leases, including the payment of all
Rent (as defined in the Leases) and any and all other amounts which may from
time to time become due and payable in accordance with the terms of the Leases
and the performance by Lessee of all of its other obligations under the Leases
(the payment of Rent and all other such indebtedness, liabilities and
obligations of Lessee guaranteed hereby being hereinafter referred to as the
"Obligations"). In the event that Lessee fails to perform any Obligation for any
reason, Guarantor will perform or otherwise provide for such Obligation and will
forthwith make full payment of any amount due with respect thereto at its sole
cost and expense. This Guaranty of the Obligations shall constitute a guaranty
of payment and performance and not of collection. It shall not be necessary or
required, and Guarantor shall not be entitled to require, that Lessor (a) file
suit or proceed to obtain or assert a claim for personal judgment against Lessee
or any other person or entity ("Person") for any Obligation, (b) make any effort
at collection or other enforcement of any Obligation from or against Lessee or
any other Person, (c) repossess and re-lease or sell any Equipment subject to
any Lease, or foreclose against or seek to realize upon any security now or
hereafter existing for any Obligation or upon any balance of any credit on the
books of Lessor or any other Person in favor of Lessee or any other Person, (d)
exercise or assert any other right or remedy to which Lessor is or may be
entitled in connection with any Obligation or any security or other guaranty
therefor or otherwise mitigate damages, or (e) assert or file any claim against
the assets of Lessee or any other guarantor of other Person liable for any
Obligation, or any part thereof, before or as a condition of enforcing the
liability of Guarantor under this Guaranty or requiring payment or performance
of any Obligation by Guarantor hereunder, or at any time thereafter.
2. Guarantor waives notice of the acceptance of this Guaranty and of
the performance or nonperformance by Lessee, presentment to or demand for
payment or other performance from Lessee or any other Person and notice of
nonpayment or failure to perform on the part of Lessee. The obligations of
Guarantor hereunder shall be absolute and unconditional and shall remain in full
force and effect and shall not be subject to any reduction, limitation,
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impairment or termination for any reason. Guarantor waives any right, whether
legal or equitable, statutory or non-statutory, to require Lessor to proceed
against or take any action against or pursue any remedy with respect to Lessee
or any other Person or make presentment or demand for performance or give any
notice of nonperformance before Lessor may enforce rights against Guarantor
hereunder and, to the fullest extent permitted by law, any other defenses or
benefits that may be derived from or afforded by applicable law limiting the
liability of or exonerating guarantors or sureties, or which may conflict with
the terms of this Guaranty. The unconditional obligations of Guarantor hereunder
will not be affected, impaired or released by any extension, waiver, amendment
or thing whatsoever which would release a guarantor or surety (other than
complete performance).
3. Guarantor agrees that this Guaranty is a continuing guaranty
relating to any Obligations, including Obligations which may exist continuously
or which may arise from time to time under successive transactions, and
Guarantor expressly acknowledges that this Guaranty shall remain in full force
and effect notwithstanding that there may be periods in which no Obligations
exist. This Guaranty shall continue in effect and be binding upon Guarantor
until fifteen (15) business days after actual receipt by Lessor of written
notice from Guarantor of its intention to discontinue this Guaranty as to future
transactions (which notice shall not be effective until noon on the business day
following such receipt); provided that no revocation or termination of this
Guaranty shall affect in any way any rights of Lessor hereunder with respect to
any Obligations or commitments arising or outstanding prior to the expiration of
such fifteen (15) business day period after the date of receipt of such notice.
4. Until the Obligations shall be satisfied in full, Guarantor shall
not have, and shall not directly or indirectly exercise, (i) any rights that it
may acquire by way of subrogation under this Guaranty, by any payment hereunder
or otherwise, (ii) any rights of contribution, indemnification, reimbursement or
similar suretyship claims arising out of this Guaranty, or (iii) any other right
which it might otherwise have or acquire (in any way whatsoever) which could
entitle it at any time to share or participate in any right, remedy or security
of Lessor as against Lessee or other guarantors, whether in connection with this
Guaranty or otherwise. If any amount shall be paid to Guarantor on account of
the foregoing rights at any time when any Obligations are outstanding, such
amount shall be held in trust for the benefit of Lessor and shall forthwith be
paid to Lessor to be credited and applied to the Obligations.
5. (a) Guarantor represents and warrants to Lessor that (i)
Guarantor is a corporation duly organized, validly existing and in good standing
under the law of its jurisdiction of incorporation, and has all requisite power
and authority to execute, deliver and perform its obligations under this
Guaranty; (ii) the execution, delivery and performance by Guarantor of this
Guaranty have been duly authorized by all necessary corporate action of
Guarantor; and (iii) this Guaranty constitutes the legal, valid and binding
obligation of Guarantor. (b) So long as this Guaranty shall be in effect,
Guarantor will furnish to Lessor from time to time such information respecting
Guarantor's financial condition as Lessor may from time to time reasonably
request; provided, however, that so long as Guarantor shall be a reporting
company under the Securities Exchange Act of 1934, the Guarantor shall not be
required to deliver to Lessor annual or quarterly financial statements.
6. No right, power or remedy herein conferred upon or reserved to
Lessor is intended to be exclusive of any other right, power or remedy or
remedies and each and every right, power and remedy of Lessor pursuant to this
Guaranty now or hereafter existing at law or in equity or by statute or
otherwise shall, to the extent permitted by law, be cumulative and concurrent
and shall be in addition to each other right, power or remedy pursuant to this
Guaranty, and the exercise by Lessor of anyone or more of such rights, powers or
remedies shall not preclude the simultaneous or later exercise by Lessor of any
or all such other rights, powers or remedies.
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7. No failure or delay by Lessor to insist upon the strict
performance of any term, condition, covenant or agreement of this Guaranty or to
exercise any right, power or remedy hereunder or consequent upon a breach hereof
shall constitute a waiver of any such term, condition, covenant, agreement,
right, power or remedy or of any such breach, or preclude Lessor from exercising
any such right, power or remedy at any later time or times.
8. In case any one or more of the provisions contained in this
Guaranty should be invalid, illegal or unenforceable in any respect, the
validity, legality and enforceability of the remaining provisions contained
herein shall not in any way be affected or impaired thereby.
9. This Guaranty (a) constitutes the entire agreement, and
supersedes all prior agreements and understandings, both written and oral, with
respect to the subject matter hereof, (b) may not be amended except by a writing
signed by Guarantor and Lessor, and (c) shall be binding upon Guarantor and its
successors and assigns and shall inure to the benefit of, and shall be
enforceable by, Lessor and its successors and assigns.
10. All notices and other communications provided for hereunder
shall be in writing (including by facsimile) and shall be mailed, sent or
delivered (i) if to Lessor, to Cisco Systems Capital, Ashurst Manor, Ashurst
Park, Church Lane, Sunninghill, Xxxxx, Xxxxxxxxx, XX0 0XX; and (ii) if to
Guarantor, at or to its address or facsimile number set forth below its name on
the signature page hereof, or at or to such other address or facsimile number as
such party shall have designated in a written notice to the other party. All
such notices and communications shall be effective upon receipt.
11. This Guaranty shall be governed by, and construed in accordance
with, the laws of the State of New York. Guarantor hereby (i) submits to the
non-exclusive jurisdiction of the courts of the State of New York and the
Federal courts of the United States sitting in the State of New York for the
purpose of any action or proceeding arising out of or relating to this Guaranty,
(ii) agrees that all claims in respect of any such action or proceeding may be
heard and determined in such courts, (iii) irrevocably waives (to the extent
permitted by applicable law) any objection which it now or hereafter may have to
the laying of venue of any such action or proceeding brought in any of the
foregoing courts in and of the State of New York, and any objection on the
ground that any such action or proceeding in any such court has been brought in
an inconvenient forum, and (iv) agrees that a final judgment in any such action
or proceeding shall be conclusive and may be enforced in other jurisdictions by
suit on the judgment or in any other manner permitted by law.
12. Guarantor agrees to pay on demand all reasonable costs and
expenses of Lessor and reasonable fees and disbursements of counsel in
connection with the enforcement, or preservation of any rights under, this
Guaranty.
IN WITNESS WHEREOF, Guarantor has caused this Guaranty to be duly
executed as of the date first hereinabove set forth.
VIATEL, INC.
By: /s/ Xxxxx Xxxx
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Title: Chief Financial Officer
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Address: 000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: General Counsel
Facsimile: (000) 000-0000
