Document:

exv10w20

 

Exhibit 10.20

SECOND AMENDMENT TO LEASE

	 	 	 
	Landlord:

	 	ORSETT/I-17 LLC, an Arizona limited liability company
	 
	 	 
	Tenant:

	 	EFTC Operating Corp., a Delaware corporation
	 
	 	 
	Date:

	 	April 3, 2007

RECITALS

     A. Landlord and Tenant entered into that certain Lease dated March 23, 1999 and the First
Amendment to Lease dated May 10, 1999 (the “Lease”) concerning certain premises in the
Building known as Phoenix Northgate located in the City of Phoenix, County of Maricopa, State of
Arizona and more particularly described in the Lease.

     B. Landlord and Tenant now desire to modify and amend the Lease as provided in this Second
Amendment to Lease (“Amendment”).

     NOW, THEREFORE, for the mutual covenants contained herein and for other valuable
consideration, the receipt and adequacy of which is hereby acknowledged, Landlord and Tenant hereby
agree as follows:

AGREEMENT

     1. Recitals. The Recitals set forth above are incorporated into this Amendment by
this reference and are hereby stipulated by Tenant and Landlord to be true and correct.

     2. Definitions. All capitalized terms used as defined terms herein which are not
otherwise defined herein shall have the meaning ascribed to them in the Lease.

     3. Term. The term of the Lease is scheduled to terminate on July 31, 2007, and
Landlord and Tenant hereby agree to extend the term of the Lease for a period of twenty-four (24)
months beginning on August 1, 2007, and ending on July 31, 2009 (the “Extended Term”).

     4. Basic Rent. Tenant shall pay as Basic Rent during the Extended Term as follows:

          Months 1-24                      $69,436.50 per month NNN ($0.70/sf/mo NNN)

     5. Address. For purposes of Landlord’s and Tenant’s Address for Notices, the following addresses shall
be used:

	 	 	 	 	 
	 

	If to Landlord:	 	Orsett/I-17 L.L.C.
	 

	 	 	 	c/o Orsett Properties, Ltd.
	 

	 	 	 	4222 E. Thomas Road, Suite 260
	 

	 	 	 	Phoenix, AZ 85018
	 

	 	 	 	Attn: Legal

 

With a Copy to:

	 	 	 
	 
	 	Orsett Properties, Ltd.

20 William Street, Suite G-50

Wellesley, MA 02481
	 
	     If to Tenant:

	 	EFTC Operating Corp
	 

	 	2401 West Grandview Road
	 

	 	Phoenix, Arizona 85023
	 

	 	Attention: CFO

     6. Renewal Option. Tenant shall have two (2) options to extend the Extended Term
of the Lease for a period of five (5) years each upon at least six (6) months’ written notice to
Landlord prior to the termination of the then current Lease Term, under the terms provided for in
Exhibit “I” with the following exception:

     The first paragraph of section B shall be deleted in its entirety, and in its place and stead
the following provision shall be inserted:

          B. The Basic Rent payable by Tenant for the first year of any Option Period shall be the
greater of (a) the Basic Rent payable by Tenant in the last month of the Extended Term or first
Option Period (as applicable), or (b) 85% of the then-current “Market Rate” for the Leased
Premises, defined as the then-current fair market rental value (expressed as a per rentable square
foot monthly rental rate) for comparable, fully improved and not subject to any landlord
concessions, office properties in the Phoenix metropolitan area at the expiration of the Extended
Term of the first Option Period, as applicable. Once the Basic Rent for the first year of either
the first or second Option Period is established, that rent will increase by 3% each year during
the remainder of such Option Period.

     7. Existing Infrastructure. Landlord and Tenant agree that Tenant (at no additional
charge to Tenant) shall be allowed to continue to utilize the existing “data center” and telephone
room and associated equipment currently located in the adjacent office building that Tenant also
leases from Landlord at 2501 W. Grandview, Phoenix, AZ. In the event of a sale or lease of the
referenced building, Landlord shall provide Tenant a sixty (60) day written notice instructing it
to remove Tenant’s property, including its trade fixtures, furniture, equipment, improvements and
other personal property, and Tenant agrees to remove such property within this 60 day period at its
sole cost and expense.

     8. Counterparts. This Amendment may be executed in any number of counterparts, each
of which will be deemed an original document, but all of which will constitute a single
document. Delivery of a signed counterpart by telephone facsimile transmission shall be
effective as delivery of a manually signed counterpart of this Amendment. Any party delivering an
executed counterpart of this Amendment by telephone facsimile shall also deliver a manually
executed counterpart of this

 

 

Amendment, but the failure to deliver a manually executed counterpart
shall not affect the validity, enforceability, and binding effect of this Amendment.

     9. Governing Law. This Amendment shall be governed, construed and interpreted by the
laws of the State of Arizona.

     10. Parties In Interest. Nothing in this Amendment (whether express or implied) is
intended to confer upon any person other than the parties hereto and their respective heirs,
representatives, successors and permitted assigns, any rights or remedies under or by reason of
this Amendment, nor shall any provision hereof give any entity any right of subrogation against or
action over or against any party.

     11. Ratification. Except as expressly modified hereby, the Lease is hereby ratified
and confirmed in its entirety.

     12. Interpretation. In the event of any conflict between the terms and provisions of
this Amendment and the Lease, the terms and provisions of this Amendment shall govern and control.

     IN WITNESS WHEREOF, Landlord and Tenant have executed this Amendment as of the date first
appearing above.

	 	 	 	 	 	 	 
	 	 	LANDLORD:	 	 
	 
	 	 	 	 	 	 
	 	 	ORSETT/I-17 LLC, an Arizona limited liability

company	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	Nelson/I-17 L.L.C., an Arizona limited
liability company	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Greg Nelson	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	Greg Nelson	 	 
	 

	 	 	 	 	 	 
	 

	 	Its:	 	Member	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	TENANT:	 	 
	 
	 	 	 	 	 	 
	 	 	EFTC Operating Corp., a Delaware corporation	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ James A. Doran	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	James A. Doran	 	 
	 

	 	 	 	 	 	 
	 

	 	Its:	 	Vice PresidentExhibit
      10.1

     

    LIMITED
      WAIVER AND CONSENT TO LOAN
      AND SECURITY AGREEMENT

     

    This
      LIMITED WAIVER AND CONSENT TO LOAN AND SECURITY AGREEMENT (this “Waiver”)
      effective as of July 31, 2007 is by and among Hines Nurseries, Inc., a
      California corporation, the parties hereto as lenders (each individually, a
      “Lender” and collectively, “Lenders” as hereinafter further defined) and Bank of
      America, N.A., in its capacity as agent for Lenders (in such capacity, “Agent”).
      Capitalized terms used and not otherwise defined herein shall have the meanings
      assigned to them in the Loan Agreement (defined below).

     

    R
      E C I T
      A L S: 

    

    WHEREAS,
      Borrower, the Agent and the Lenders have entered into that certain Loan and
      Security Agreement dated as of January 18, 2007 (as amended, the
“Loan
      Agreement”);
      and

     

    WHEREAS,
      Borrower, Agent and Lenders have agreed to extend the date for providing
      unaudited financial statements, waive a certain Event of Default and consent
      to
      the sale of certain real property located in Trenton, South Carolina upon the
      terms and conditions contained herein;

     

    NOW,
      THEREFORE, in consideration of the premises contained herein, and for other
      good
      and valuable consideration, the receipt and sufficiency of which are hereby
      acknowledged, the parties hereto hereby agree as follows:

     

    Section
      1 Limited
      Waiver to the Loan Agreement.
      Borrower acknowledges that a certain Event of Default exists under Section
      11.1
      of the Loan Agreement as a result of Borrower’s failure to provide notice of a
      default under the Indenture for failure to provide the unaudited financial
      statements for the fiscal quarter ending March 31, 2007 (and related public
      filings) as required by Section 10.1.3(c) of the Loan Agreement (the “Event of
      Default”). Immediately upon the satisfaction of each of the conditions precedent
      set forth in Section 3
      below,
      the Agent and Required Lenders hereby waive the Event of Default; provided,
      that
      Borrower shall deliver the unaudited financial statements for the fiscal quarter
      ending March 31, 2007 required by the Indenture and cure any related defaults
      thereunder by no later than August 31, 2007, the failure of which shall cause
      such waiver to be terminated and result in such Event of Default continuing
      to
      exist under the Loan Agreement. The foregoing is a limited waiver and shall
      not
      constitute a waiver of any other Default or Event of Default that may exist
      or
      arise or constitute a waiver or modification to any other term or condition
      set
      forth in the Loan Agreement. 

     

    Section
      2 Limited
      Consent to the Loan Agreement.
      Immediately upon the satisfaction of each of the conditions precedent set forth
      in Section 3
      below,
      the Agent and Required Lenders hereby waive the restrictions set forth in
      Section 10.2.6 of the Loan Agreement and provide their consent for the sole
      purpose of permitting Borrower to consummate the sale of its inventory,
      equipment and real property located in Trenton, South Carolina; provided,
      that
      net proceeds from such sale in the amount of at least $5,000,000 are deposited
      into the Borrower’s cash deposit accounts held at Bank of America on or prior to
      September 30, 2007, which shall be applied against the outstanding balance
      of
      Loans, if any, on such date, which in no case shall result in a permanent
      reduction of the Revolver Commitment. 

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    Section
      3 Conditions
      to Effectiveness.
      The
      effectiveness of the waivers and consent set forth in Sections 1
      and 2
      above
      are subject to the satisfaction of each of the following
      conditions:

     

    (a) Agent
      shall have received a duly executed counterpart of this Waiver from Borrower
      and
      the Required Lenders; and

     

    (b) Agent
      shall have received a reaffirmation from Parent of its Guaranty. 

     

    Section
      4 Representations,
      Warranties and Covenants.
      Borrower represents, warrants and covenants to Agent and Lenders, upon the
      effectiveness of this Waiver that:

     

    (a) No
      Default; etc.
      No
      Default or Event of Default has occurred and is continuing after giving effect
      to this Waiver or would result from the execution or delivery of this Waiver
      or
      the consummation of the transactions contemplated hereby.

     

    (b) Corporate
      Power and Authority; Authorization.
      Borrower has the power and authority to execute and deliver this
      Waiver.

     

    (c) Execution
      and Delivery.
      Borrower has duly executed and delivered this Waiver.

     

    (d) Enforceability.
      This
      Waiver constitutes the legal, valid and binding obligations of Borrower,
      enforceable against Borrower in accordance with its terms, except as enforcement
      may be limited by bankruptcy, insolvency, reorganization, moratorium or similar
      laws affecting the enforcement of creditors’ right generally, and by general
      principles of equity.

     

    (e) Indenture
      Notice.
      Borrower has not received any default notices under its Indenture in respect
      of
      its 10.25% Senior Notes due 2011 dated as of September 30, 2003, between Hines
      Nurseries, Inc., Hines Horticulture, Inc., the Subsidiary Guarantors named
      therein and the Bank of New York, as Trustee.

     

    Section
      5 Miscellaneous.

     

    (a) Effect;
      Ratification.
      Borrower acknowledges that all of the reasonable legal expenses incurred by
      Agent in connection herewith shall be reimbursable under Section 3.4
      of the
      Loan Agreement. The waiver set forth herein is effective solely for the purposes
      set forth herein and shall be limited precisely as written, and shall not be
      deemed to (i) be a consent to any amendment, waiver or modification of any
      other term or condition of any Loan Document or (ii) prejudice any right or
      rights that any Lender may now have or may have in the future under or in
      connection with any Loan Document. This Waiver shall be construed in connection
      with and as part of the Loan Documents and all terms, conditions,
      representations, warranties, covenants and agreements set forth in the Loan
      Documents, except as herein amended are hereby ratified and confirmed and shall
      remain in full force and effect.

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

    (b) Counterparts;
      etc.
      This
      Waiver may be executed in any number of counterparts, each such counterpart
      constituting an original but all together one and the same instrument. Delivery
      of an executed counterpart of this Waiver by fax shall have the same force
      and
      effect as the delivery of an original executed counterpart of this Waiver.
      Any
      party delivering an executed counterpart of this Waiver by fax shall also
      deliver an original executed counterpart, but the failure to do so shall not
      affect the validity, enforceability or binding effect of this
      Waiver.

     

    (c) Governing
      Law.
      This
      Waiver shall be deemed a Loan Document and shall be governed by, and construed
      and interpreted in accordance with the internal laws of the State of New York
      but excluding any principles of conflicts of law.

     

    (d) Reaffirmation.
      Parent
      hereby reaffirms all of its obligations as a guarantor of the Obligations
      pursuant to its Guaranty dated as of January 18, 2007.

     

     

    [Signature
      Pages Follow]

      
        
          
          

        

        
          3

          
            

          

        

        
          
          

        

      

    

     

    IN
      WITNESS WHEREOF, Agent, Lenders and Borrower have caused this Limited Waiver
      and
      Consent to Loan and Security Agreement to be duly executed as of the day and
      year first above written.

     

    BORROWER:

     

    HINES
      NURSERIES, INC.

     

    By:
      /s/
      Claudia M.
      Pieropan                                                   

    Title:
       CFO                                                                                
      

    Name: Claudia
      M.
      Pieropan                                                   

    

    

    PARENT:

     

    HINES
      HORTICULTURE, INC.

     

    By:
      /s/
      Claudia M.
      Pieropan                                                    

    Title:
       CFO                                                                                 

    Name: Claudia
      M.
      Pieropan                                                    

    

    

    AGENT
      AND LENDERS:

    

    BANK
      OF
      AMERICA, N.A., as Agent and a Lender

    

    

    By:
      /s/
      Jason
      Riley                                                                   

    Title:
       Vice
      President                                                               

    Name: Jason
      Riley                                                                   

    

    

    PNC
      BANK,
      NATIONAL ASSOCIATION, as a Lender

    

    

    By:
      /s/
      Gregory J.
      Hall                                                              

    Title: Vice
      President                                                                 

    Name: Gregory
      J.
      Hall                                                              

    

    

    GMAC
      COMMERCIAL FINANCE LLC, as a Lender

    

    

    By:
      /s/ Robert Richardson                   

    Title:
      Director                        

    Name:
      Robert Richardson                  

     

     

     

    S-1

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