EXHIBIT 10.38
MASTER
LEASE AGREEMENT
MASTER LEASE Number UKCSC1265 dated October 27, 2000
between:
CISCO SYSTEMS CAPITAL (also known as Leasetec UK Limited)
having its principal place of business at: Ashurst Manor, Ashurst Park,
Xxxxxx Xxxx, Xxxxxxxxxxx, Xxxxx, Xxxxxxxxx, XX0 0XX
(hereafter called "the Lessor")
and
VIATEL U.K. LIMITED
having its principal place of business at: Xxxxxxx Xxxxx, 00 Xxxxxx Xxxx,
Xxxxxx, XX0X 0XX XX
(hereafter called "the Lessee)
1. DEFINITIONS
In this Master Lease the following words or expressions shall have the following
meanings:
"BUSINESS DAY" means a day on which banks are open for business in London,
England, and New York, New York, except Saturdays.
"CERTIFICATE OF ACCEPTANCE" means, in relation to the Products, a certificate
delivered by Lessor, and countersigned by the Lessee confirming that the
Products fully meet the Lessee's requirements.
"COMMENCEMENT DATE" means the date when the Products are deemed accepted by the
Lessee pursuant to Article 8 hereunder.
"EQUIPMENT" means, in relation to each Equipment Schedule, the equipment from
time to time subject to such Schedule, and includes each and every part of it
and all substitutions, replacements, renewals and additions (wherever made) and
all manuals, operating instructions and documents relating thereto.
"EQUIPMENT SCHEDULE" means an agreement substantially in the form of Addendum A
hereto, signed by Lessee and Lessor, listing items to be leased and the related
rentals.
"EVENTS OF DEFAULT" means the events specified in Article 17.1.
"LEASE PAYMENTS" means the payment of rentals specified in the Equipment
Schedule(s) as varied or amended pursuant to the terms of the Lease.
"LESSEE" includes its successors and permitted assigns.
"LESSOR" includes its successors and assigns.
"LICENSED PROCESSOR" means a processor or equipment configuration of the type
specified in the Equipment Schedule and which may be in a Software Licence.
"MASTER LEASE" means this agreement and includes its Addenda and Exhibits but
excludes any associated Equipment Schedules.
"PRODUCTS" means, in relation to each Equipment Schedule, the Equipment and the
Software listed thereon.
"SOFTWARE" means, in relation to each Equipment Schedule, the operating and
application Software from time to time subject to such Schedule and all updates
thereto.
"SOFTWARE LICENCE" means the right granted by the Supplier to use the Software.
"STANDARD TERMS" means the terms and conditions of supply of the Supplier
applicable to the Lessee.
"SUPPLIER" means Cisco Systems, Inc., or any affiliate thereof (other than
Lessor) or any, Value Added Reseller of Cisco products, or any licensor of
Software.
2. OBJECT
The Lessor hereby agrees to lease to the Lessee and the Lessee hereby agrees to
take on lease from the Lessor the Products on the terms and conditions of this
Master Lease and any additional terms set out in the applicable Equipment
Schedule. Each Equipment Schedule shall constitute a separate and independent
Lease (a "Lease"); the original of such Lease shall consist of the
manually-signed Equipment Schedule and a reprographic copy of the Master Lease.
3. TERM
This Master Lease and each Equipment Schedule shall come into force as of the
date of their signature by the Lessor and Lessee; the Master Lease shall remain
effective as long as any Equipment Schedule is in effect. The term of each Lease
shall commence on the Commencement Date and shall continue thereafter for the
number of months or years as specified in such Lease (hereinafter called the
"Initial Term").
Provided no Event of Default shall have occurred and be continuing, the Lessee
may extend the Initial Term to the extent provided in the applicable Equipment
Schedule. Lessee will notify the Lessor in writing of its decision to extend the
Initial Term pursuant to any such right at least three (3) months prior to the
expiration date of the Initial Term or the then-current extended term. The
Lessee will execute at the Lessor's request any amendment that may in the
Lessor's opinion be required to the Lease before such extension comes into
effect.
The Lessee may terminate all or any Leases at any time by giving 30 days' notice
in writing to the Lessor, by returning the Products to the location specified by
the Lessor within the jurisdiction in which they were originally installed in
compliance with the Equipment Schedule, in the condition required under the
Lease, and by paying such sum as would be payable under clause 17.2(c) upon
termination of such Lease(s) under clause 17.2(b). Any such notice, once given,
shall be irrevocable.
4. LEASE PAYMENTS/TAXES
The Lessee shall pay the Lessor the Lease Payments specified in the Lease at the
intervals specified therein.
The first Lease Payment shall be due on the Commencement Date. The Lessee
acknowledges that such Lease Payments are to be made without notice or invoice
and without defence, counterclaim, recoupment or set-off and that its obligation
to pay the Lease Payments and any other amounts owing hereunder shall be
absolute and unconditional. The Lessor will make reasonable efforts to supply
invoices to the Lessee but lack thereof does not alleviate the Lessee's
obligation to pay.
The Lessee shall make Lease Payments to the Lessor by direct debit, standing
order or by such other means and to such address as the Lessor shall reasonably
stipulate. Time shall be of the essence to all sums payable hereunder.
Any Lease Payments or other sums payable hereunder not paid on the due date
shall be subject to late charges at a rate of 3% per annum above one-month LIBOR
as of the last Business Day of each calendar month (commencing with the rate
based upon the calendar month immediately preceding such due date) as determined
by Lessor from the applicable Reuters screen, without prejudice to the Lessor's
right hereunder to treat non-payment as a repudiatory breach of this Lease. All
sums due to the Lessor under this Lease are (unless otherwise stated) exclusive
of Value Added Tax ("VAT") and any other applicable sales or turnover taxes or
duties which may from time to time be introduced, which shall be charged thereon
in accordance with the relevant regulations in force at the time of making the
taxable supply and shall be paid by the Lessee.
For the purpose of United Kingdom taxation, and irrespective of the accounting
treatment to be adopted by the Lessee, the Lessee shall not be entitled to claim
capital allowances on the Products. The Lessee shall take such steps as the
Lessor may reasonably require in connection with the application for and
preservation of any available capital allowances for the benefit of the Lessor.
5. WARRANTY OF QUIET ENJOYMENT AND DISCLAIMER OF WARRANTIES
The Lessor warrants to the Lessee that, so long as the Lessee shall not be in
default of any of the provisions of this Lease or of the licence referred to in
clause 6, the Lessor will not disturb the Lessee's quiet and peaceful possession
of the Products and the Lessee's unrestricted use thereof for the purposes
intended in the Lease.
The Lessee shall be entitled to the benefit of and the Lessor hereby (so long as
there exists no Event of Default) assigns to Lessee all warranties given by the
Supplier on the whole or any part of the Products (subject to the limitations
and exclusions contained in Supplier's Standard Terms), insofar as such benefit
is capable of being transferred to the Lessee. If any such warranty is not
capable of being transferred, then Lessor shall take commercially reasonable
efforts to enforce same, (i) at the cost and expense of Lessee, (ii) subject to
execution of indemnity agreement by Lessee in form and substance satisfactory to
Lessor, and (iii) provided Lessee is not in breach of any term or provision
hereof.
THE LESSOR MAKES NO EXPRESS OR IMPLIED CONDITIONS OR WARRANTIES CONCERNING THE
CONDITION, DESCRIPTION, QUALITY OR PERFORMANCE OF THE PRODUCTS OR OF THEIR
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE AND HEREBY EXCLUDES THE
SAME. THE LESSOR SHALL HAVE NO LIABILITY FOR ANY DAMAGES IN CONTRACT OR TORT,
WHETHER DIRECT OR CONSEQUENTIAL, FOR LOSS, DAMAGE OR INJURY SUSTAINED BY THE
LESSEE AS A RESULT OF ANY DEFECT OR MALFUNCTION OF THE PRODUCTS.
The Lessee acknowledges that no representation has been made by or on behalf of
the Lessor in relation to the Products and agrees that the Lessor shall not be
liable for any delay in delivery of the Products or any part thereof howsoever
caused.
Nothing herein shall exclude or restrict the Lessor's liability for death or
personal injury resulting from the negligence or intentional misconduct of the
Lessor or its employees while acting in the course of their employment.
6. SOFTWARE LICENCE
The Lessee agrees to indemnify and hold the Lessor harmless from and against any
and all claims, costs, expenses, damages, liabilities and reasonable legal fees
that the Lessor may suffer or incur as a result of any dispute that may arise,
in any way whatsoever, in connection with any Software Licence relating to any
Products.
The Lessee undertakes to continue making Lease Payments to the Lessor in full
without deduction or set-off of any kind for the full term of each and any
Equipment Schedule notwithstanding termination of the Software License for any
reason whatsoever.
Notwithstanding the terms of this Lease, the Software Licences may be terminated
by the Suppliers thereof in accordance with their terms. The Lessor agrees to
exercise reasonable efforts to notify the Lessee of any claim of infringement
brought against it in relation to any such Software Licenses, provided, however,
that any failure to provide such notice shall not be deemed to provide the basis
for any claim of damages or other compensation by the Lessee.
7. RETURN OF PRODUCTS
Upon termination (by expiration or otherwise) of each Equipment Schedule, the
Lessor or such other party as may be appointed by the Lessor shall, at the
Lessee's sole cost and expense, de-install the Products and prepare them for
return to the Lessor. The Lessee shall, pursuant to the Lessor's instructions
and at the Lessee's sole cost and expense (including, without limitation,
expenses of storage, transportation, import and export, if applicable, tariffs,
taxes, and in-transit insurance), promptly return the Products to the Lessor in
the same operating order, repair, condition and appearance as when received,
except for normal depreciation and wear and tear, and eligible for a maintenance
contract with the Supplier or a third party maintenance provider approved by
Lessor at standard rates. The Lessee shall return the Products to the Lessor by
delivering them within 30 days of such termination of such Equipment Schedule to
the Lessor at its address set forth herein or at such other address within the
jurisdiction in which they were originally installed in accordance with the
applicable Equipment Schedule as reasonably directed by the Lessor.
Until return of the Products to the Lessor, the Lessee shall be responsible for
all storage and for proper and safe custody of the Products, and continued
insurance in accordance with the terms hereof. If the Products are not returned
when required by the foregoing terms, the Lessee shall pay the Lessor rentals at
the Lessor's month-to-month rental rates.
8. LESSEE'S ACCEPTANCE
The Lessee's acceptance of the Products shall occur when the Lessee signs a
Certificate of Acceptance stating that the Products fully meet its requirements,
or upon thirty (30) days from their date of delivery to the Lessee without prior
written objection (in reasonable detail) by the Lessee delivered to the Lessor,
whichever shall occur first. The Lessee agrees on the date of acceptance and
satisfaction of the matters stated in such certificate to execute and deliver to
the Lessor a Certificate of Acceptance of the Products.
9. TITLE, LOCATION AND INSPECTION
The Lessee shall have no right, title or interest in the Products leased
hereunder except as expressly set forth in this Lease. The Lessee at its expense
will protect and defend the owner's title and the interests of the Lessor and
any secured party and/or assignee and will keep the Products free and clear from
any and all claims, liens, encumbrances and legal processes of the Lessee's
creditors and other persons.
The Lessee shall immediately notify third parties of the Lessor's rights in the
Products in case of exercise by them of any claim in possession of said Products
and will promptly inform the Lessor of such claims; the Lessee shall bear all
reasonable legal costs on a full indemnity basis which the Lessor may have to
disburse in order to defend its rights as the Lessor of the Products.
The parties acknowledge that the Products are or will be installed at the
premises listed on each Equipment Schedule, or as specified on the invoice for
the Products from the Supplier relating to such Equipment Schedule. As between
the Lessor and the Lessee, the Lessee assumes the full expense of transportation
and insurance to, and installation of the Products at, the Lessee's site. The
Lessee shall not remove any Products from the location shown on the applicable
Equipment Schedule without in each instance (i) if the new location is within
the same legal jurisdiction, giving the Lessor not less than fifteen days' prior
written notice thereof, and (ii) if the new location is within another legal
jurisdiction, obtaining the Lessor's prior written consent thereto, such consent
not to be unreasonably withheld or delayed.
All Products shall at all times be and remain personal property; the Lessee
shall exercise reasonable efforts to provide the Lessor with any certificate
which the Lessor may reasonably require from the owner (which expression shall
include any person having title to or interest in such premises) of the premises
where the Products are to be installed. The Lessor may require plates or
markings to be affixed to the Products to indicate its interest in such
Products.
The Lessor shall have the right, upon reasonable prior notice to the Lessee and
during Lessee's regular business hours (subject to satisfaction of customary and
reasonable security and confidentiality policies of Lessee or, in the case of
co-located Products of the entity owning or controlling such facility), to
inspect the Products at their location. The Lessee shall, upon the Lessor's
request make the Lessee's records pertaining to the Products available to the
Lessor for inspection.
10. USE AND MAINTENANCE
The Lessee shall use the Products in a good and careful manner, in a proper
environment and in compliance with the applicable operating instructions and all
applicable laws and regulations and for no other purpose than that for which
such Products were designed.
The Lessee shall not make any alterations, enhancements, modifications or
attachments to the Products without the Lessor's prior written consent if and to
the extent any such alteration, enhancement, modification, or attachment (i)
would reasonably be expected to impair the marketability, function or value of
the Product, or (ii) is not subject to removal or detachment without causing
cosmetic or functional damage to the Product or (iii) could cause the Product to
become subject to the claim or lien of any third person. Unless otherwise
agreed, all such alterations, enhancements, modifications and attachments shall
become a part of the Products. Lessee agrees to remove any such attachment at
the end of the term of the Lease, unless such removal would result in cosmetic
or functional damage to the Product, and upon such removal, title to such
attachment shall revert to Lessee.
Lessee, at its sole cost and expense, shall during the continuance of this
Lease,
(i) maintain the Products in good repair, condition and working order, fair
wear and tear excepted,
(ii) enter into and maintain in full force and effect during the term of
the applicable Equipment Schedule a standard maintenance contract with
the Supplier or a third party maintenance provider reasonably
acceptable to Lessor and comply with all of its obligations contained
therein.
In the event the Lessee contracts for maintenance with a party other than the
Supplier, the Lessee shall, at the Lessor's request, provide the Lessor with a
copy of such maintenance contract. All parts furnished in connection with such
maintenance or repair, shall thereupon become the property of the Lessor and
part of the Products for all purposes hereof. Upon Lessor's request at the
expiration of the Initial Term (or, in the event of any extension of the Term,
upon the expiration of such extension), the Lessee will have the Supplier or a
third party maintenance provider approved by Lessor inspect the Products at the
Lessee's cost in order to confirm whether such Products meet the Supplier's then
current operating standards and are eligible for a maintenance contract with the
Supplier or a third party maintenance provider approved by the Lessor; if they
do not, the Lessee will be required to have the Products serviced to bring them
up to such standards prior to their return to the Lessor and the Lessee shall
pay rental for the period during which their return is delayed at Lessor's
month-to-month rental rates.
11. INSURANCE/RISK OF LOSS
The Lessee shall during the term of this Lease insure the Products against all
insurable risks in an amount not less than the amount that would be required to
be paid to Lessor under paragraph (c) of this clause 11 and shall insure the
Lessor and the Lessee against liability to others for injury, loss or damage
caused by the Products in each case with a reputable insurer and in amounts of
coverage and deductibles customary among businesses for items similar to the
Products (but not less than $1 million per occurrence).
The Lessee's obligation to maintain insurance shall commence on the delivery
date of the Products and shall continue until the Initial Term or any renewal
term terminates and the Products are returned to the Lessor. Furthermore, the
Lessee shall pay the cost of any specific insurance to be taken by the Lessor in
connection with the delivery of the Products to the Lessee.
The Lessee shall cooperate and cause its insurers to cooperate with the Lessor
with respect to the Products; the Lessee shall have the Lessor's interest noted
on the insurance policy and produce on request written evidence of insurance and
of the payment of premiums. If adequate insurance is not evidenced to the Lessor
upon such request, the Lessor may effect the insurance and claim reimbursement
with the next Lease Payment.
The Lessee hereby assumes and bears the entire risk of loss, theft, damage,
destruction or requisition of the Products during the continuance of the term of
each Lease and until return of the Equipment to Lessor; no such event shall
relieve the Lessee from its obligation to make Lease Payments or to perform any
other obligation under the Lease, except if such Lease terminates pursuant to
paragraph (c) below.
The Lessee shall notify the Lessor promptly in writing of the occurrence of any
of the above events and Lessee at the option of the Lessee (provided that the
Lessee shall, no later than the date on which payment under paragraph (c) below
would be required, elect one of the following) shall:
a) place the Products in good repair, condition and working order at the
sole cost and expense of the Lessee, or
b) replace such Products with like ones from the Supplier or its authorized
agents in good repair, condition and working order, with clear title thereto
in Lessor at the sole cost and expense of the Lessee, and following such
replacement the new product(s) shall be deemed to be the "Products" for the
purpose of the Lease, or
c) pay to Lessor within 30 days after demand therefor (or, if later, prior to 60
days after the occurrence of the applicable casualty event) an amount equal
to the total Lease Payments and other sums past due and owing hereunder
(using a discount at the rate of 4% per annum) and (without prejudice to any
other right or remedy of the Lessor) the lease of such Products shall be
terminated.
The proceeds of any Lessee insurance payable with respect to any loss, theft,
damage, destruction or requisition of the Products shall be applied towards one
of the following (as Lessor shall promptly elect):
(i) Lessee's replacement, restoration or repair of the Products or
(ii) payment of any of the Lessee's other obligations under this Lease. The
Lessee hereby appoints the Lessor as the Lessee's agent in order to claim
and/or receive payment of and execute and endorse all documents, cheques or
drafts issued with respect to such loss, theft, damage, destruction or
requisition under any insurance policy relating thereto. Any proceeds of
Lessee insurance remaining after application above shall, be paid to the
Lessee.
12. INTELLECTUAL PROPERTY RIGHTS
The Lessor disclaims all liability for violation, misappropriation or
infringement of intellectual property rights (including but not limited to
claims concerning patents, copyrights and trade secrets) and further disclaims
any liability for incidental or consequential damages. No rights to any
intellectual property are conveyed, assigned or licensed under this Lease, nor
shall the foregoing disclaimer impair any right or claim of Lessee against any
Supplier. Lease Payments for Software are made in lieu of license fees otherwise
due for such Software under the related Software License.
13. TRANSFER OF RIGHTS
The Lessee shall not transfer, sell, assign, sublet, sublicense, part with
possession, pledge or encumber any right or interest in the Lease or in the
Products without the Lessor's prior written consent, such consent not to be
unreasonably withheld or delayed, provided, however, the Lessee may assign the
Lease or sublet the Products to any subsidiary of Viatel, Inc. located in any
jurisdiction previously approved by the Lessor, provided prompt written notice
thereof is given to the Lessor. Such consent shall not relieve the Lessee from
its obligations set forth in the Lease. The Lessee acknowledges that the Lessor
may sell and assign its interest absolutely or grant a security interest in the
Lease and/or in the Products listed therein in whole or in part.
The Lessee hereby agrees that upon receipt of a notice of assignment of
this Lease, it shall pay directly to the Lessor's assignee or secured party,
unconditionally, all amounts which become due hereunder. The Lessee represents
that it will not assert against the Lessor's assignee or secured party any
claims by way of defence or set-off, counterclaim, recoupment or otherwise which
the Lessee may have against the Lessor, Supplier or any third party.
14. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE LESSEE
14.1 The Lessee hereby represents and warrants that, with respect to this
Master Lease and to the Equipment Schedules executed pursuant hereto: a) the
execution, delivery and performance thereof by the Lessee have been duly
authorized by all necessary corporate action and shall not contravene any law or
obligation to which the Lessee or Viatel, Inc. is bound;
b) this Master Lease and each Equipment Schedule constitute legal, valid
and binding agreements of the Lessee;
c) each Product has been selected on the basis of the Lessee's own judgement;
d) the Products are personal property and will not, by or through any act or
omission of Lessee (or any successor or predecessor in interest of Lessee),
be or become fixtures under any applicable law;
e) all financial statements furnished to the Lessor are true and correct in all
material respects and there has been no material adverse change since the
date of such statements and the Lessee shall provide the Lessor with the
annual audited financial statements of Viatel, Inc. (unless at such time
Viatel, Inc. is a reporting company under the Securities Exchange Act of
1934) and such other financial information as the Lessor may reasonably
request from time to time; and
f) the Lessee has received all necessary import and export licenses required by
any government in connection with the shipment, delivery, installation and
usage of the Equipment as contemplated by the Lease.
14.2 The Lessee further warrants and covenants that Viatel, Inc. shall at
all times observe and perform or cause to be observed and performed the
obligations set forth in Sections 4.03 through 4.11, and 4.13 through 4.15, and
Section 5.01 of that Senior Euro Notes Indenture dated as of April 20, 2000
between Viatel, Inc. and The Bank of New York (the "Indenture"), which sections
(together with all applicable defined terms) of such Indenture are incorporated
herein by this reference in the form existing on the execution date of such
Indenture.
14.3 [Redacted]
15. GENERAL INDEMNITY
15.1 The Lessee shall and does hereby agree to defend, indemnify and hold
the Lessor and any assignee and any secured party of the Lessor harmless from
and against any and all claims, cost, expenses, damages and liabilities,
including storage and reasonable legal fees on a full indemnity basis, arising
directly or indirectly, whether in breach of contract or tort, or from any other
applicable rule of law arising in connection with, or pertaining to the lease,
manufacture, design, possession, import, export, licensing, operation, control,
use, maintenance, delivery or return of the Products. The Lessee shall further
indemnify and hold the Lessor harmless from all losses, costs, damages, and
expenses (including reasonable attorneys' fees), if for any reason the Lessor is
not able to assert its ownership rights or regain possession of the Products,
including due to the fact that the Products are located outside the United
Kingdom, or at the site of another company. Lessor and any assignee and/or
secured party may at its option and at its sole expense, participate in any such
action with counsel of its own choice.
The provisions of this Article shall survive any expiration or sooner
termination of this Master Lease and any Equipment Schedule.
15.2 The indemnities contained in clause 15.1 (General Indemnity) shall not
extend to:
a) any claim made by any person pursuant to that clause (a "Claim") in relation
to any of the Lessor, any assignee or any secured party of the Lessor (each
an "Indemnitee") to the extent that that Claim is paid pursuant to any other
indemnity provision of this Agreement and/or by the proceeds of any insurance
received by an Indemnitee;
b) any Claim to the extent arising from:
(i) any act or omission of any Indemnitee which constitutes a breach of,
or an express representation given by the Indemnitee being incorrect
under this Agreement, or wilful misconduct of such Indemnitee; or
(ii) an act of gross negligence of the Indemnitee;
c) any Claim resulting directly from the Lessee acting on the Indemnitee's
written instructions;
d) any Claim in respect of taxes;
e) any Claim in respect of loss of profit, indirect or consequential loss
suffered by any Indemnitee; or
f) any Claim to the extent it arises directly as a result of a lien over any
of the Products which is entered into by or assessable against the Lessor
or any superior titleholder to Lessor.
16. FURTHER ASSURANCES
If reasonably requested by the Lessor, the Lessee shall promptly secure,
execute, and/or deliver to Lessor such further documents and take such further
action as Lessor shall reasonably deem necessary to carry out the intent and
purpose of this Lease and to protect the Lessor's interest in the Products.
17. DEFAULT, ETC.
17.1 EVENTS OF DEFAULT
An Event of Default shall occur hereunder if:
a) The Lessee fails to pay any Lease Payment or other payment required
hereunder or under any Lease within ten (10) days after the due date or if
no date is specified within ten (10) days of written demand by the Lessor;
or
b) The Lessee fails to perform or observe or cause to be performed or observed
(i) any warranty or covenant set forth in Article 14.2 and such failure is
not remedied within 30 days of the date written notice of such failure is
provided to Viatel, Inc. by the Trustee or Holders of more than 25% of the
Notes under (and as defined in) the Indenture, or (ii) any other covenant,
condition or agreement to be performed or observed by it hereunder and,
other than a failure to maintain insurance under Article 11 or a transfer
of any Product in violation of Article 13, shall fail to remedy such breach
within 30 days after being required by the Lessor in writing to do so; or
c) The Lessee makes any representation herein or in any document or
certificate furnished to the Lessor in connection herewith which shall have
been materially false and inaccurate; or
d) A voluntary agreement is approved, or a petition for an administration
order is presented, or a receiver or administrative receiver is appointed
over any of the Lessee's assets or any undertaking or a resolution or
petition to wind up the Lessee is passed or presented or if any
circumstances arise which entitles the Court or a creditor to appoint a
receiver, administrative receiver or administrator or to present a winding
up petition or make a winding-up order and, except in the event the Lessee
or any of its affiliates has sought or acquiesced in such presentation or
appointment, any such proceeding is not dismissed or vacated within 30 days
of commencement; or
e) The Lessee ceases or threatens to cease or carry on business or if the
Lessee sells, transfers or disposes of all or substantially all of its
assets; or
f) Any governmental consent or approval at any time necessary to enable Lessee
to comply with its material obligations under this Lease or the Equipment
Schedule, or any licence required in relation to the Products is revoked,
withheld or modified or fails to remain in full force and effect; or
g) The Lessee or Viatel, Inc. shall suffer or commit any breach or default in
respect of Indebtedness (as such term is defined in the Indenture) having
an outstanding principal amount of $10 million or more in the aggregate,
(i) which breach or default has caused the holder of such Indebtedness to
declare such Indebtedness to be due and payable prior to its Stated
Maturity (as defined in the Indenture) and such Indebtedness has not been
discharged in full or such acceleration rescinded or annulled within 10
days of such acceleration, or (ii) which breach or default shall consist of
a failure to make a principal payment at the final (but not any interim)
fixed maturity and such default payment shall not have been made, waived or
extended within 30 days of such payment default; or
h) The Products or any part thereof are illegally used or confiscated; or
i) There shall occur any event of default under Section 6.01(g) or (h) of the
Indenture; or
j) The Lessee shall cease to be a subsidiary of Viatel, Inc.
17.2 REMEDIES
Upon the occurrence of any of the above Events of Default, the Lessor may, as
its option, exercise any one or more of the following remedies:
a) Proceed by appropriate court action to enforce performance by the Lessee of
the applicable terms and conditions of all or any Leases or to recover
damages for the breach thereof;
b) By notice terminate all or any Leases whereupon all rights of the Lessee to
use the Products listed on the terminated Equipment Schedule(s) will
absolutely cease; the Lessee, if so requested, will, at its expense
promptly return the Products to the Lessor at the place within the
jurisdiction of original installation in accordance with the applicable
Equipment Schedule designated by the Lessor and in the condition required
pursuant to the terms hereof, or the Lessor, at its option, may enter the
premises where the Products are located and take immediate possession
thereof and remove the same.
c) In the case of termination of any Lease pursuant to sub-clause b) above,
the Lessee shall pay the Lessor:
(1) all arrears in Lease Payments and other sums due hereunder as at the
date of termination plus interest as specified herein for past due
amounts, plus,
(2) an amount equal to the aggregate of the Lease Payments which would but
for termination have become due and payable from the date of
termination up to the end of the term of the Lease less a discount on
each Lease Payment for accelerated receipt at the rate of 4% per
annum.
Following return of the Products to Lessor pursuant to this clause, the Lessor
will proceed to either sell or re-lease the Equipment in such a manner as it
deems appropriate in its sole discretion. In the event that as a result thereof,
the aggregate amount previously received by the Lessor pursuant to paragraph (c)
of this Section exceeds the amount that would have been payable had such sale or
re-lease occurred before the payment under paragraph (c), then the Lessor shall
remit such excess to the Lessee promptly thereafter.
d) Avail itself of any other remedy or remedies available at law, or in
bankruptcy or insolvency proceedings.
The remedies herein set forth shall be cumulative and not exclusive. In
addition, the Lessee shall be liable for
(i) all reasonable costs and expenses incurred in repossessing, storing,
repairing, restoring and selling or leasing the Products.
(ii) all other amounts owing by the Lessee hereunder, and
(iii)all reasonable costs and expenses, including (without limitation) all
legal costs on a full indemnity basis incurred by the Lessor as a
result of the Lessee's default hereunder.
17.3 CHANGE OF CONTROL
Upon the occurrence of a "Change of Control" (as defined in the Indenture) the
Lessee shall:
a) Promptly notify the Lessor of such occurrence; and
b) Unless otherwise agreed by the Lessor, within 30 days of such occurrence
pay the Lessor the amount that would be due and payable under clause 11(c)
had there occurred a casualty event relating to all such Products,
whereupon (i) the Leases shall be terminated, and (ii) the Lessor shall
transfer its right, title and interest in and to the Products to the
Lessee, without representation or warranty.
18. NOTICES
All notices and other communications made or required to be given under this
Lease shall be in writing and shall be deemed given upon receipt when sent by
registered or recorded mail, return receipt requested, or by recognised
overnight delivery courier, or when delivered personally, or by telefax with
mail confirmation:
In case of the Lessor: at the address set forth in the
applicable Equipment Schedule with a copy to any assignee or secured party at
the address(es) set forth in any notice thereof given to the Lessee;
In case of the Lessee: at the address set forth in the applicable Equipment
Schedule.
19. MISCELLANEOUS
a) The Lessor and the Lessee acknowledge that there are no agreements or
understandings, written or oral, between the Lessor and the Lessee with
respect to the leasing of the Products except as set forth herein and in the
Equipment Schedule and that this Master Lease and each Equipment Schedule
contain the entire agreement between the Lessor and the Lessee with respect
thereto;
b) Neither this Master Lease nor any Equipment Schedule may be altered, modified
or terminated except by a written statement signed by the party against whom
enforcement of such alteration, modification or termination is sought;
c) The headings set forth herein and in the Equipment Schedule are for
convenience only and shall not define or limit any of the terms herein or
therein;
d) If more than one Lessee is named in this Master Lease or in the Equipment
Schedule, the liability of each Lessee shall be joint and several.
e) This Master Lease and any associated Equipment Schedules shall become
effective and binding as of the date it is accepted by the Lessor and the
Lessee, and shall be binding upon and inure as of such date to the benefit of
both parties hereto and their respective legal representatives, successors
and assigns, unless otherwise expressly provided herein;
f) All agreements, representations, indemnities and warranties made by the
Lessee in this Master Lease, any Equipment Schedule or any document delivered
pursuant hereto or thereto shall be for the benefit of the Lessor, any
assignee and any secured party and shall survive the expiration or sooner
termination of this Master Lease or such Equipment Schedule.
g) (1)The Lessee acknowledges that it has or will contract with the Supplier for
any maintenance, support, consultancy, facilities management or other
services listed on the Equipment Schedule which will be provided to the
Lessee by the Supplier under the terms of the relevant services agreement
entered into between the Supplier and the Lessee or, in the absence thereof,
then under the Supplier's Standard Terms relating thereto (such separate
services agreement or Standard Terms, as applicable, being referred to herein
as the "Services Agreement").
(2)The Lessor shall have no obligation whatsoever and makes no warranty or
representation regarding the quality of services or performance of any
obligation under the Services Agreement, and shall have no other liability
whatsoever in contract, tort, negligence or otherwise in connection
therewith.
(3)The Lessee undertakes with the Lessor, subject to the express terms
hereof, to continue making Lease Payments to the Lessor in full without
deduction or set-off of any kind for the full term of each Equipment Schedule
notwithstanding termination of the Services Agreement for any reason
whatsoever, or any negligence on the part of the Supplier or any breach by
the Supplier of its obligations thereunder. The Lessee accepts that the
Lessee's sole remedy in respect of such termination, negligence or breach
shall be against the Supplier under the Services Agreement or otherwise.
(4)The undertaking shall apply notwithstanding that the Lease Payments have
been calculated partly by reference to the level of fees which the Lessee
would have been obligated to pay under the Services Agreement had such
obligation to pay not been assigned to the Lessor.
h) No omission or delay by the Lessor at any time to enforce any right or remedy
reserved to it or to require performance by the Lessee of any of the terms,
covenants or provisions of this Master Lease or any Equipment Schedule at the
times designated herein or therein, shall be a waiver of any such right or
remedy to which the Lessor is entitled, nor shall it in any way affect the
right of the Lessor to thereafter enforce such provision;
i) If any term or provision of this Master Lease or of any Equipment Schedule or
the application thereof to any person or circumstance shall, to any extent be
held invalid or unenforceable, the remainder of this Master Lease or of such
Equipment Schedule or the application of such terms or provision to persons
or circumstances other than those to which it is held invalid or
unenforceable shall not be affected thereby and each term and provision of
this Master Lease and any such Equipment Schedule shall be valid and
enforceable to the fullest extent permitted by law;
j) Upon execution of this Master Lease, the Lessee shall provide the Lessor with
certified resolutions addressed to the Lessor in form and substance
satisfactory to the Lessor.
k) This Master Lease and each Equipment Schedule shall in all respects be
governed by, and construed in accordance with English Law;
i) The Parties hereby submit to the exclusive jurisdiction of the English
Courts.
SIGNED FOR AND ON BEHALF OF LESSEE: VIATEL U.K. LIMITED
-----------------------------------
SIGNATURE
-----------------------------------
NAME
-----------------------------------
TITLE
-----------------------------------
DATE
SIGNED IN THE PRESENCE OF:
-----------------------------------
SIGNATURE
-----------------------------------
NAME AND TITLE
-----------------------------------
DATE
SIGNED FOR AND ON BEHALF OF LESSOR: CISCO SYSTEMS CAPITAL
-----------------------------------
SIGNATURE
-----------------------------------
NAME
-----------------------------------
TITLE
-----------------------------------
DATE
SIGNED IN THE PRESENCE OF:
-----------------------------------
SIGNATURE
-----------------------------------
NAME AND TITLE
-----------------------------------
DATE
ADDEMDUM A
Equipment Schedule No. to Master Lease Agreement No. dated October 27, 2000
Lessee: VIATEL U.K. LIMITED
Address for Xxxxxxx Xxxxx, 00 Xxxxxx Xxxx, Xxxxxx, XX0X 0XX
Notices: United Kingdom
Lessor: CISCO SYSTEMS CAPITAL
Address for Ashurst Manor, Ashurst Park, Church Lane, Sunninghill, Ascot,
Notices: Xxxxxxxxx, XX0 0XX
APPLICATION
-----------
We hereby apply to take the Products set out in this Equipment Schedule
("Schedule") on lease on the terms set out below and in the Master Lease
Agreement terms and conditions. We confirm before signing this Schedule we read
the terms and particulars and that our signature is made on the understanding
that upon your acceptance of this Schedule we will be bound by all the terms of
this Schedule and the Master Lease Agreement terms and conditions.
For and on behalf of Lessee: Agreed for and on behalf Cisco
Systems Capital (the "Lessor"):
Signature: Signature:
Title: Title:
Witness Name: Witness Name:
Signature: Signature:
Date Agreement Date:
A. LEASE TERMS
--------------
Initial Term Payment Frequency Number of Lease Lease Payment
Payments (Monthly/Quarterly Payments Amount (excl VAT)
Half Yearly/Yearly)
------------- ------------------- ---------------- -----------------
B. SPECIAL TERMS
----------------
At the end of the Initial Term the Lessee has the option to use all and not less
than all of the Products at an annual charge of 0.1% of the original equipment
cost, payable annually in advance.
C. EQUIPMENT
------------
QTY TYPE DESCRIPTION
--- ---- -----------
INSTALLATION SITE
-------------------
C. EQUIPMENT CONTINUED /2...
----------------------------
QTY TYPE DESCRIPTION
--- ---- -----------
INSTALLATION SITE
-------------------
C. EQUIPMENT CONTINUED /3...
----------------------------
QTY TYPE DESCRIPTION
--- ---- -----------
PURCHASE OPTION ADDENDUM
(Master Lease Agreement)
This PURCHASE OPTION ADDENDUM dated as of , is an attachment to Equipment
Schedule No. to Master Lease Agreement No.--- dated October 27, 2000, (Such
Equipment Schedule and Master Lease Agreement are hereinafter collectively
referred to as, the "Lease"), between CISCO SYSTEMS CAPITAL ("the Lessor") and
Viatel U.K. Limited ("the Lessee"). Unless otherwise specified herein, all
capitalized terms shall have the meanings ascribed to them in the Lease. The
Lessor and the Lessee hereby agree as follows:
So long as no Event of Default shall have occurred and be continuing and
the Lessee shall have given the Lessor at least ninety (90) days, but not
more than one hundred eighty (180) days, prior written notice, the Lessee
shall have the option to purchase the Products at the expiration of the
Initial Term (the "Purchase Option Date") for a purchase price equal to
$1.00 + VAT (the "Purchase Option Price"). Payment of the Purchase Option
Price, together with all applicable sales taxes, including VAT, and all
other amounts due and owing by the Lessee under the Lease (including,
without limitation, Lease Payments) on or before the Purchase Option Date,
shall be made on the Purchase Option Date in immediately available funds
against delivery to the Lessee of all of the Lessor's right, title and
interest in and to the Products ON AN "AS IS" "WHERE IS" BASIS, WITHOUT
ANY WARRANTIES, EXPRESS OR IMPLIED, AS TO ANY MATTER WHATSOEVER, INCLUDING
WITHOUT LIMITATION, THE CONDITION OF THE PRODUCTS, THEIR MERCHANTABILITY
OR THEIR FITNESS FOR ANY PARTICULAR PURPOSE. THE LESSOR MAY SPECIFICALLY
DISCLAIM ANY SUCH REPRESENTATIONS AND WARRANTIES. If and to the extent the
purchase option is exercised, Section 7 and the last sentence of Section
10 of the Lease shall not apply in respect of the equipment related to the
above-mentioned Equipment Schedule.
Except as modified hereby, all of the terms, covenants and conditions of the
Lease shall remain in full force and effect and are in all respects hereby
ratified and affirmed.
IN WITNESS WHEREOF, Lessor and Lessee have executed this Purchase Option
Addendum as of the date first above written.
Signed for and on behalf of Lessor: Signed for and on behalf of Lessee:
CISCO SYSTEMS CAPITAL VIATEL U.K. LIMITED
Signature:-------------------------- Signature:--------------------------
Name: -------------------------- Name: --------------------------
Title: -------------------------- Title: --------------------------
