EXHIBIT 10.18
GUARANTY
GUARANTY dated as of March 19, 2001 made by each of the
undersigned (collectively, the "Guarantor") in favor of Voicenet, Inc., a
Delaware corporation (the "Payee").
PRELIMINARY STATEMENTS: The Guarantor and XXX.Xxx, L.L.C., a
Florida limited liability corporation (the "Borrower") are parties to a Letter
of Intent of even date herewith ("Letter of Intent") with the Payee that
contemplates, among other things, Payee making a loan to the Borrower in the
principal amount of $250,000 (the "Loan"), on the terms and conditions set forth
therein, including the execution of this Guaranty. Payment of the Loan shall be
secured by this Guaranty and by a certain Pledge and Security Agreement. (This
Guaranty, such Pledge and Security Agreement and the promissory note of the
Borrower evidencing the Borrowers' obligation to repay the Loan are herein
collectively called the "Loan Documents") The Guarantor owns a substantial
amount of the stock or other ownership interests of the Borrower and/or is
financially interested in its affairs.
THEREFORE, in order to induce the Payee to make the loan, each
of the undersigned Guarantor, jointly and severally agrees) as follows:
Section 1. GUARANTY OF PAYMENT. The Guarantor
unconditionally and irrevocably guarantees to the Payee the punctual payment of
all sums now owing or which may in the future be owing by the Borrower on
account of the Loan, when the same are due and payable, whether at stated
maturity, by acceleration or otherwise, and whether for principal, interest,
fees, expenses, indemnification or otherwise (all of the foregoing sums being
the "Liabilities"). The Liabilities include, without limitation, interest
accruing after the commencement of a proceeding under bankruptcy, insolvency or
similar laws of any jurisdiction at the rate or rates provided in the Loan
Documents. This Guaranty is a guaranty of payment and not of collection only.
The Payee shall not be required to exhaust any right or remedy or take any
action against the Borrower or any other person or entity or any collateral. The
Guarantor agrees that, as between the Guarantor and the Payee, the Liabilities
may be declared to be due and payable for the purposes of this Guaranty
notwithstanding any stay, injunction or other prohibition which may prevent,
delay or vitiate any declaration as regards the Borrower and that in the event
of a declaration or attempted declaration, the Liabilities shall immediately
become due and payable by the Guarantor for the purposes of this Guaranty.
Section 2. GUARANTY ABSOLUTE. The Guarantor guarantees
that the Liabilities shall be paid strictly in accordance with the terms of the
Facilities. The liability of the Guarantor under this Guaranty is absolute and
unconditional irrespective of: (a) any change in the amount, time, manner or
place of payment of, or in any other term of, all or any of the Loan Documents
or Liabilities, or any other amendment or waiver of or any consent to departure
from any of the terms of any Loan Document or Liability; (b) any release or
amendment or waiver of, or consent to departure from, any other guaranty or
support document, or any exchange, release or non-perfection of any collateral,
for all or any of the Loan Documents or Liabilities; (c) any present or future
law, regulation or order of any jurisdiction (whether of right or in fact) or of
any agency thereof purporting to reduce, amend, restructure or otherwise affect
any term of any Loan Document or Liability; (d) without being limited by the
foregoing, any lack of validity or enforceability of any Loan Document or
Liability; and (e) any other
defense, setoff or counterclaim whatsoever with respect to the Loan Documents or
the transactions contemplated thereby which might constitute a defense available
to, or discharge of, the Borrower or a guarantor.
Section 3. GUARANTY IRREVOCABLE. This Guaranty is a
continuing guaranty of the payment of all Liabilities now or hereafter existing
and shall remain in full force and effect until payment in full of all
Liabilities and other amounts payable under this Guaranty or, if earlier, upon
consummation of the merger of Finger Lakes Technology Corp. into the Payee
contemplated by the Letter of Intent.
Section 4. REINSTATEMENT. This Guaranty shall continue to
be effective or be reinstated, as the case may be, if at any time any payment of
any of the Liabilities is rescinded or must otherwise be returned by the Payee
on the insolvency, bankruptcy or reorganization of the Borrower or otherwise,
all as though the payment had not been made.
Section 5. SUBROGATION. The Guarantor shall not exercise
any rights against the Borrower which it may acquire by way of subrogation, by
any payment made under this Guaranty or otherwise, until all the Liabilities
have been paid in full and the Facilities are no longer in effect. If any amount
is paid to the Guarantor on account of subrogation rights under this Guaranty at
any time when all the Liabilities have not been paid in full, the amount shall
be held in trust for the benefit of the Payee and shall be promptly paid to the
Payee to be credited and applied to the Liabilities, whether matured or
unmatured or absolute or contingent, in accordance with the terms of the
Facilities. If the Guarantor makes payment to the Payee of all or any part of
the Liabilities and all the Liabilities are paid in full and the Facilities are
no longer in effect, the Payee shall, at the Guarantor's request, execute and
deliver to the Guarantor appropriate documents, without recourse and without
representation or warranty, necessary to evidence the transfer by subrogation to
the Guarantor of an interest in the Liabilities resulting from the payment.
Section 6. SUBORDINATION. Without limiting the Payee's
rights under any other agreement, any liabilities owed by the Borrower to the
Guarantor in connection with any extension of credit or financial accommodation
by the Guarantor to or for the account of the Borrower, including but not
limited to interest accruing at the agreed contract rate after the commencement
of a bankruptcy or similar proceeding, are hereby subordinated to the
Liabilities, and such liabilities of the Borrower to the Guarantor, if the Payee
so requests, shall be collected, enforced and received by the Guarantor as
trustee for the Payee and shall be paid over to the Payee on account of the
Liabilities but without reducing or affecting in any manner the liability of the
Guarantor under the other provisions of this Guaranty.
Section 7. CERTAIN TAXES. The Guarantor further agrees
that all payments to be made hereunder shall be made without setoff or
counterclaim and free and clear of, and without deduction for, any taxes,
levies, imposts, duties, charges, fees, deductions, withholdings or restrictions
or conditions of any nature whatsoever now or hereafter imposed, levied,
collected, withheld or assessed by any country or by any political subdivision
or taxing authority thereof or therein ("Taxes").
Section 8. REPRESENTATIONS AND WARRANTIES. The Guarantor
represents and warrants that this Guaranty: (a) has been authorized by all
necessary action; (b) does not violate any agreement, instrument, law,
regulation or order applicable to the Guarantor; (c) does not require the
consent or approval of any person or entity, including but not limited to any
governmental authority, or any filing or registration of any kind; and (d) is
the legal, valid and binding obligation of the Guarantor enforceable
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against the Guarantor in accordance with its terms, except to the extent that
enforcement may be limited by applicable bankruptcy, insolvency and other
similar laws affecting creditors' rights generally.
Section 9. REMEDIES GENERALLY. The remedies provided in
this Guaranty are cumulative and not exclusive of any remedies provided by law.
Section 10. FORMALITIES. The Guarantor waives
presentment, notice of dishonor, protest, notice of acceptance of this Guaranty
or incurrence of any Liability and any other formality with respect to any of
the Liabilities or this Guaranty.
Section 11. AMENDMENTS AND WAIVERS. No amendment or
waiver of any provision of this Guaranty, nor consent to any departure by the
Guarantor therefrom, shall be effective unless it is in writing and signed by
the Payee, and then the waiver or consent shall be effective only in the
specific instance and for the specific purpose for which given. No failure on
the part of the Payee to exercise, and no delay in exercising, any right under
this Guaranty shall operate as a waiver or preclude any other or further
exercise thereof or the exercise of any other right.
Section 12. EXPENSES. The Guarantor shall reimburse the
Payee on demand for all costs, expenses and charges (including without
limitation fees and charges of counsel for the incurred by the Payee in
connection with the performance or enforcement of this Guaranty. The obligations
of the Guarantor under this Section shall survive the termination of this
Guaranty.
Section 13. LIMITED RECOURSE. Guarantor's liability
hereunder is limited to its ownership interest in the Borrower and in Finger
Lakes Technology Corp., which have been pledged to the Payee pursuant to the
Pledge and Security Agreement comprising part of the Loan Documents.
Section 14. ASSIGNMENT. This Guaranty shall be binding
on, and shall inure to the benefit of the Guarantor, the Payee and their
respective successors and assigns; provided that the Guarantor may not
assign or transfer its rights or obligations under this Guaranty. Without
limiting the generality of the foregoing: (a) the obligations of the Guarantor
under this Guaranty shall continue in full force and effect and shall be binding
on any successor partnership and on previous partners and their respective
estates if the Guarantor is a partnership, regardless of any change in the
partnership as a result of death retirement or otherwise; and (b) the Payee may
assign, sell participations in or otherwise transfer its rights under the
Facilities to any other person or entity, and the other person or entity shall
then become vested with all the rights granted to the Payee in this Guaranty or
otherwise.
Section 15. CAPTIONS. The headings and captions in this
Guaranty are for convenience only and shall not affect the interpretation or
construction of this Guaranty.
Section 16. GOVERNING LAW, ETC. THIS GUARANTY SHALL BE
GOVERNED BY THE LAW OF THE STATE OF CONNECTICUT. THE GUARANTOR CONSENTS TO THE
NONEXCLUSIVE JURISDICTION AND VENUE OF THE STATE OR FEDERAL COURTS LOCATED IN
THE CITY OF STAMFORD, CONNECTICUT. SERVICE OF PROCESS BY THE PAYEE IN CONNECTION
WITH ANY SUCH DISPUTE SHALL BE BINDING ON THE GUARANTOR IF SENT TO THE GUARANTOR
BY REGISTERED MAIL AT THE ADDRESS SPECIFIED BELOW OR AS OTHERWISE SPECIFIED BY
THE GUARANTOR FROM TIME TO TIME. THE GUARANTOR WAIVES ANY RIGHT TO
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INTERPOSE ANY COUNTERCLAIM RELATED TO THIS GUARANTY OR THE TRANSACTIONS
CONTEMPLATED HEREBY IN ANY SUCH ACTION.
Section 17. WAIVER OF JURY TRIAL. THE GUARANTOR AND THE PAYEE
EACH WAIVE ANY RIGHT IT MAY HAVE TO JURY TRIAL IN ANY ACTION RELATED TO THIS
GUARANTY OR THE TRANSACTIONS CONTEMPLATED HEREBY
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IN WITNESS WHEREOF, each of the undersigned has caused this Guaranty to
be duly executed and delivered as of the date first above written.
FINGER LAKES TECHNOLOGY CORP. ESS MEMBERS
5CD+0.Xxx, Inc.
By: ____________________________
Xxxxxxx Xxxxx
President By _______________________________
Xxxxxxx X. Xxxxxx
President
FINGER LAKES SHAREHOLDERS:
5CD+0.XXX, INC. _______________________________
Xxxx XxXxxx
By ____________________________
Xxxxxxx X. Xxxxxx, President _______________________________
Xxxx Xxxxxx
________________________________
Xxxx XxXxxx _______________________________
Xxxx Xxxxx
________________________________
Xxxx Xxxxxx
FINGER LAKES TECHNOLOGY CORP.
________________________________
Xxxx Xxxxx
By:____________________________
Xxxxxxx Xxxxx
TOUCHTONE T ECHNOLOGIES, INC. President
By:_____________________________
Name:
Title:
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