EXHIBIT 10.25.2


 


SECOND AMENDMENT
TO LEASE


 


THIS SECOND
AMENDMENT (the “Amendment”), is entered into effective as of November 1,
2002, (the “Effective Date”) between Kayares International, LLC., a California
limited liability company, as successor in interest to Old Courthouse Square,
LLC (“Lessor”) and Advanced TelCom Group, Inc. (“Lessee”).


 


WHEREAS,
Lessor and Lessee entered into a Lease dated as of January 29, 1999, as
amended by Addendum One dated effective as of January 19, 1999 (the “First
Addendum”), Second Addendum to Lease dated effective as of January 29,
1999 (the “Second Addendum”), and the First Amendment to Lease dated August 12,
1999 (the “First Amendment”) (the First Addendum, the Second Addendum and the
First Lease are collectively referred to as the “Lease”).


 


WHEREAS,
Lessor and Lessee desire to expand the Premises to include the remaining
portion of the second floor of the Building not already leased to Lessee as the
Expansion Premises, such portion having a total of approximately 3657 rentable
square feet of space (the “Second Expansion Premises”) and to modify the Lease
in certain other respects (the Second Expansion Premises are more particularly
described on the floor plan attached hereto as Schedule 1).


 


WHEREAS, the
parties agree that current fair market rent for the Premises, would not be less
than $1.50 per square foot for the first floor and $1.20 per square foot for
the second floor, but in consideration of Lessee’s agreement to enter into this
Amendment and to assume all obligations under the Lease as amended herein,
Lessor has instead agreed to collect rent at the lower rate as provided in the
Lease as Amended herein; and


 


WHEREAS, GE
Business Productivity Solutions, Inc., (“GEBPS”) has agreed, conditioned
on the close of its purchase of the assets or stock of Lessee, to guaranty all
obligations of Lessee to Lessor under the Lease as amended herein, and in the
meantime, as provided and subject to the limitations set forth in its Guaranty
in the form attached as Schedule 2, to provide a limited guaranty of
Lessee’s rent obligations under the Lease as amended in this Amendment.


 


NOW THEREFORE,
and in consideration of the mutual agreements and covenants hereinafter set
forth, the parties wish to amend the Lease as follows:


 


1.)            All terms
defined in the Lease shall have the same meanings in this Amendment as in the
Lease.


 


2.)            As of the
Effective Date, the Premises shall be deemed to include the Second Expansion
Premises.


 


3.)            The term of
the Lease with respect to the Second Expansion Premises shall commence on the
Effective Date and expire on August 31, 2004 (collectively, with the
Expansion Term for the Expansion Premises, referred to herein as the “Expansion


 


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Term”).  Notwithstanding the foregoing, Lessor will
have no obligation to repair or correct any non compliance with the conditions
required under Sections 2.2 and 2.3 of the Lease arising from any Improvements
made by the Lessee prior to the Closing Date within the Expansion Premises.


 


4.)            Commencing
on the Effective Date, Base Rent for the Second Expansion Premises shall be
$1.15 per rentable square foot within the Second Expansion Premises for the remaining
balance of the initial Expansion Term following the Second Expansion Commencement
Date.  As of November 1, 2003, the
Base Rent shall be $1.15 per rentable square foot within the Second Expansion
Premises plus a CPI increase (not to exceed 3%) until August 31, 2004.


 


5.)            Commencing
on the Effective Date, Lessee shall occupy 100% of the first floor and 100% of
the second floor, and shall be responsible for 100% of triple net expenses as
provided in the Lease, including but not limited to maintenance, insurance and
property taxes, until August 31, 2004, after which Lessee shall be obligated
to pay its pro-rata share of triple net expenses as provided in the Lease.


 


6.)            No later
than ten (10) days following full execution of this Amendment, Lessee
agrees to provide Lessor with a security deposit equal to one (1) month of
the Rent due under the Lease (as amended hereby) as security for Lessee’s
faithful performance of its obligations under this Lease to be held by Lessor
as follows:


 


If Lessee
fails to pay Rent, or otherwise Defaults under the Lease, Lessor may use, apply
or retain all or any portion of said Security Deposit for the payment of any
amount due Lessor or to reimburse or compensate Lessor for any liability,
expense, loss or damage which Lessor may suffer or incur by reason thereof.  If Lessor uses or applies all or any portion
of said Security Deposit, Lessee shall within ten (10) days after written
request therefor deposit monies with Lessor sufficient to restore said Security
Deposit to the full amount required by the Lease.  If the Base Rent increases during the term of
the Lease, Lessee shall, upon written request from Lessor deposit additional
monies with Lessor so that the total amount of the Security Deposit shall at
all time bear the same proportion to the Increased Base Rent as the initial
Security Deposit bore to the initial Base Rent. 
Should the Agreed Use be amended to accommodate a material change in the
business of Lessee or to accommodate a sublessee or assignee, Lessor shall have
the right to increase the Security Deposit to the extent necessary, in Lessor’s
reasonable judgment, to account for any increased wear and tear that the
Premises may suffer as a result thereof; provided, however, the foregoing shall
not apply to any assignment by Lessee by operation of law, or in connection
with any transfer or sale of all or substantially all of the assets or equity
interests of Lessee.  If a change in
control of Lessee occurs during the Lease and following such change the
financial condition of Lessee is, in Lessor’s reasonable judgment,
significantly reduced, Lessee shall deposit such additional monies with Lessor
as shall be sufficient to cause the Security Deposit to


 


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be a
commercially reasonable level based on said changes in financial condition.  Lessor shall not be required to keep the
Security Deposit separate from its general accounts.  Within fourteen (14) days after the
expiration or termination of this Lease, if Lessor elects to apply the Security
Deposit only to unpaid Rent and otherwise within thirty (30) days after the
Premises have been vacated pursuant to Paragraph 7.4(c) of the Lease,
Lessor shall return that portion of the Security Deposit not used or applied by
Lessor.  No part of the Security Deposit
shall be considered to be held in trust, to bear interest or to be prepayment
for any monies to be paid by Lessee under the Lease.


 


7.)            Lessor and
Lessee acknowledge and agree that Lessee has occupied the Second Expansion
Premises, and has made improvements in such Premises, including the Second
Expansion Premises, and that such Second Expansion Premises (and all of Lessee’s
improvements to the Premises) is acceptable “as is” as of the Effective Date.  If and to the extent any repairs are required
within the Second Expansion Premises to bring such Second Expansion Premises
and such prior tenant improvements into compliance with the conditions required
under Sections 2.2 and 2.3 of the Lease, Lessee agrees to pay Lessor fifty
percent (50%) of any such direct and actual expenses incurred up to a maximum
of $10,000 to be paid by Lessee.


 


8.)            The Lease
is further amended by deleting in its entirety the contact information for
Lessor appearing adjacent to its signature on the Lease and inserting, in lieu
thereof, the following:


 


Kayares
International LLC

Attn:  Renee K. Kwan, Managing Member

PO Box 117339

Burlingame, CA.  94011

Phone:  (415)439-5318

Facsimile:  (415) 439-5309


 


9.)            In the
event that any provision of this Amendment and any provision of the Lease are
inconsistent or conflicting, the inconsistent or conflicting provisions of this
Amendment shall be and constitute an amendment of the Lease and shall control,
but only to the extent that such provision is expressly inconsistent with the
Lease.  Except as expressly amended by
this Amendment, the Lease is in all respects ratified, confirmed and approved
and all the terms, provisions and conditions set forth in the Lease which are
not specifically modified by Amendment shall be and remain in full force and
effect.


 


10.)          This
Amendment may be executed in any number of counterparts, each of which when so
executed will be deemed an original, and all of which together, shall
constitute one and the same document.


 


11.)          In the
event that GEBPS does not consummate either (A) a purchase of the assets
of Lessee, including an assumption and assignment of the Lease as amended
herein, or (B) an acquisition of all of the stock of Lessee on or before June 1,
2003, this


 


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Amendment
shall terminate on that date and be of no further force and effect, and Lessee
shall immediately vacate the Second Expansion Premises.


 


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IN WITNESS
WHEREOF, and intending to be legally bound hereby, the duly authorized
representatives of Lessor and Lessee have executed this Amendment as of the
Effective Date.


 


	
   

  	
  “LESSOR”

  
	
   

  	
   

  
	
   

  	
  KAYARES INTERNATIONAL, LLC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ [illegible]

  
	
   

  	
   

  	
   

  
	
   

  	
  Its:

  	
  Managing Member

  
	
   

  	
   

  	
   

  
	
   

  	
  Date:

  	
  26 February 2003

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  “LESSEE”

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  ADVANCED TELCOM GROUP, INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ [illegible]

  
	
   

  	
   

  	
   

  
	
   

  	
  Its:

  	
  CEO

  
	
   

  	
   

  
	
   

  	
  Date:

  	
  2/26/03

  
							



 


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Schedule 1


 


[Insert a diagram of the Second Expansion
Premises]


 


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Schedule 2


 


Form of GEBPS Guaranty


 


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GUARANTY
OF LEASE


 


Reference is
made to the Lease entered into between Kayares International, LLC, a California
limited liability company, as successor in interest to Old Courthouse Square,
LLC (“Lessor”) and Advanced TelCom Group, Inc.,
a Delaware corporation (“Lessee”)
effective as of January 29, 1999, as amended by Addendum One dated
effective as of January 19, 1999, Second Addendum to Lease dated effective
as of January 29, 1999, and the First Amendment to Lease dated August 12,
1999 (the First Addendum, the Second Addendum and the First Lease are
collectively referred to as the “Lease”) and the
Second Amendment to Lease entered into effective as of November 1, 2002,
between Lessor and Lessee (the “Amended Lease”).


 


In
consideration of the Amended Lease and conditioned on the terms specified
herein, GE Business Productivity Solutions, Inc. (“Guarantor”)
has agreed to execute this Guaranty.


 


1.             Limited Payment Guaranty.  Guarantor agrees to guaranty the prompt, full
and complete performance of all of the obligations of Lessee to pay rent and
expenses under the Amended Lease during a period commencing on the effective
date of this Guaranty until the earlier of:  (A) the purchase by Guarantor and/or any
of its affiliates (a “Guarantor Affiliate”) of a substantial portion of the
assets of Lessee (the “Assets”) pursuant to the Asset Purchase Agreement dated
as of June 21, 2002 as approved in Lessee’s bankruptcy case (the “Asset
Purchase Agreement”), or (B) a controlling equity interest in Lessee
through a chapter 11 reorganization plan approved by the bankruptcy court (the “Plan”);
or (C) the effective date of the rejection, by Lessee, of the Amended
Lease in Lessee’s bankruptcy case; or (D) Guarantor’s written notice to Lessor
that Guarantor and/or a Guarantor Affiliate has elected not to purchase the
Assets of Lessee, or a controlling equity interest in Lessee through a Plan
(such period being referred to herein as the “Guaranty
Period”).  If, at any time
during the Guaranty Period, Lessee fails to make any payment: under the Amended
Lease when due, Guarantor shall, upon written notice from Lessor and without
further demand, pay the same in the same manner and to the same extent as is
required of Lessee.  Notwithstanding the
foregoing, upon expiration of the Guaranty Period, the Guarantor shall be
released from its obligations under this Guaranty.


 


2.             Covenants Regarding Assumption
of Lease.


 


A.            Conditioned and effective upon
the closing of the acquisition by Guarantor and/or a Guarantor Affiliate of a
controlling equity interest: in Lessee through a Plan, Guarantor agrees that (A) Guarantor
shall cause Lessee to assume the Amended Lease, (B) Guarantor shall cause
Lessee not to assign the Amended Lease to any entity except Guarantor or a
Guarantor Affiliate, and (C) Guarantor guarantees to pay Lessor in full,
if such amounts are not paid by Lessee or its successor, any excess over the
rent and expenses under the Amended Lease collected by Lessee or its successor
from any assignee of the Amended Lease pursuant to assignment of the Amended
Lease under Section 365(f) of the Bankruptcy Code.


 


B.            In the event there is no closing
of the acquisition by Guarantor and/or a Guarantor Affiliate of a controlling
equity interest in Lessee through a Plan, and conditioned and effective upon
the closing of the acquisition by Guarantor and/or a Guarantor Affiliate of the
Assets of Lessee, Guarantor agrees that Guarantor and/or a Guarantor Affiliate
shall cause Lessee to assume the Amended Lease and shall assume all obligations
of Lessee under the Amended


 


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Lease. 
[NM:  the sale order in effect now
authorizes GEBPS or its designated affiliate to assume the lease such that we
don’t believe a separate order is necessary]


 


3.             Waivers.  Guarantor understands and acknowledges that
the Amended Lease may, and likely will, be amended or modified from time to
time by agreement of Lessor and Lessee and that this may be done without notice
to or approval of Guarantor, it being understood that Guarantor is relying
solely on Lessee to protect its interests in connection with such matters.  Guarantor hereby waives any suretyship rights
or defenses that may be or become available to Guarantor by reason of Sections
2787 to 2855, inclusive, of the California Civil Code, and agrees that:


 


(a)           The Amended Lease may be
assigned, modified or amended in whole or in part or the Premises (as defined
in the Amended Lease) may be sublet in whole or in part without notice to
Guarantor and without releasing Guarantor or affecting Guarantor’s obligations
under this Guaranty in any way.


 


(b)           Lessor may, from time to time,
and without notice to Guarantor, release any security that Lessor may have for
the obligations of Lessee under the Amended Lease or accept security therefor;
add, substitute or release guarantors; or compromise or settle any amount due
or owing, or claimed to be owing under the Amended Lease; and no such action by
Lessor or any other action which Lessor may take or omit to take in connection
with the Amended Lease shall affect this Guaranty or Guarantor’s obligations in
any way.


 


(c)           Guarantor expressly waives
notice of acceptance of this Guaranty and diligence of collecting any sums due
under the Amended Lease or the taking of any action with reference to any
default under the Amended Lease or to any liability under this Guaranty.


 


(d)           Lessor has no duty to disclose
to Guarantor any information it receives regarding the financial status of
Lessee, whether or not such information indicates that the risk of Guarantor
under this Guaranty has been or may be increased.  Guarantor assumes full responsibility for
being and keeping informed of Lessee’s financial condition, Lessee’s
performance under the Amended Lease, and Lessee’s use and operation of the
Premises.


 


(e)           Guarantor hereby subordinates
all its claims for payment of any indebtedness of Lessee to Guarantor, if any,
to Lessor’s right to receive payment from Lessee of all sums due under the
Amended Lease and waives any rights it may have to participate in any security
for the Amended Lease or to enforce any remedy which Lessor may have against
Lessee or any other person or entity that may now or hereafter be liable on the
Amended Lease.


 


(f)            The obligations of Guarantor
under this Guaranty are independent of the obligations of Lessee, and Lessor
may directly enforce its rights under this Guaranty without proceeding against
or joining Lessee or any other guarantor of the Amended Lease, and without
applying or enforcing any security for the Amended Lease.


 


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(g)           In the event any payment by
Lessee to Lessor is held to constitute a preference, fraudulent conveyance,
unauthorized transfer, or similar voidable payment under any law now or
hereafter in effect, and is rescinded or otherwise required to be returned by
Lessor, such payment by Lessee to Lessor shall not constitute a release of
Guarantor from any liability hereunder: and this Guaranty shall continue to be
effective or shall be reinstated, as the case may be, to the extent of any such
payment: or payments.


 


(h)           Guarantor agrees to indemnify
Lessor for all costs and expenses, including court costs and attorneys fees,
incurred or paid by Lessor in enforcing this Guaranty.


 


(i)            Guarantor specifically waives
any and all of the rights and defenses described in subdivision (a) of Section 2856
of the California Civil Code.


 


(j)            This Guaranty shall inure to
the benefit of any person or persons, entity or entities who at any time may be
entitled to the benefits and obligated to perform the duties of Lessor under
the Amended Lease and shall be binding upon the heirs, administrators,
successors and assigns of Guarantor.


 


(k)           This Guaranty is the final,
complete, and exclusive statement of the terms of the agreement between the
parties pertaining to Guarantor’s guarantee of the Amended Lease and supersedes
any and all prior or contemporaneous understandings, agreements,
representations or communications between or among the parties, either oral or
written, concerning this Guaranty.


 


(l)            This Guaranty shall be
construed in accordance with the fair meaning of the language used.  No rule of construction to the effect
that ambiguities are to be resolved against the drafting party shall apply in
interpreting this Guaranty.


 


(m)          This Guaranty may not be
changed orally, and no obligation of Guarantor can be released or waived except
by a writing signed by Lessor.


 


(n)           If any term or provision of
this Guaranty is ever determined to be illegal or unenforceable, all other
terms and provisions of this Guaranty shall remain effective and enforceable to
the fullest extent permitted by law.


 


(o)           This Guaranty and the rights
and obligations of Guarantor and Lessor under this Guaranty shall be governed
by and construed in accordance with the laws of the State of California,
excluding its conflicts of law principles.


 


4.             Notice.  Any notice required under this Guaranty shall
be given in writing and shall be deemed to have been delivered and given for
all purposes when (i) delivered by hand or to a designated e-mail address
(with written or electronic confirmation of receipt) before 5:00 p.m. on a
business day (or otherwise on the next succeeding business day); (ii) sent
by facsimile before 5:00 p.m. on a business day (or otherwise on the next
succeeding business day) and a written confirmation of the transmission is
received by the sender; or (iii) the next business day after being
deposited for delivery with a nationally recognized overnight delivery service,
such as Federal Express, and addressed or sent, as the case may be, to the
appropriate addresses or


 


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facsimile numbers set forth below.  Either party may change its address for the
purpose of notice hereunder by providing the other party with notice of the new
address.


 


To Lessor:


 


Kayares
International, Inc.

50 California Street, Suite 1500

San Francisco, CA 94111

Attn: Renee Kwan, Managing Director

Fax: (415) 439-5309


 


To Guarantor:


 


GE Business
Productivity Solutions, Inc.

6540 Powers Ferry Road

Atlanta, Georgia 30339

Attention: General Counsel

Fax: (770) 644-7752


 


IN WITNESS
WHEREOF, this Guaranty has been executed by Guarantor, effective as of November 1,
2002.


 


GUARANTOR:


 


GE BUSINESS PRODUCTIVITY

SOLUTIONS, INC.


 


	
  By:

  	
  /s/David M. O’Neill

  	
   

  
	
   

  	
  Name:

  	
  David M. O’Neill

  	
   

  
	
   

  	
  Title:

  	
  EVP

  	
   

  
					



 


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