Document:

EXHIBIT 10.18.2

 

SECOND AMENDMENT TO OFFICE LEASE 

DATED JULY 18, 2005 

BY AND BETWEEN ESCHELON TELECOM, Inc. (TENANT) 

AND 

ARI CENTRAL, LP AND DANARI
CENTRAL, LLC (COLLECTIVELY 

LANDLORD)

 

This Second
AMENDMENT TO LEASE (“Second Amendment”) is made and entered into effective July
15, 2005, by and between ARI CENTRAL, LP a Delaware limited partnership and
DANARI CENTRAL, LLC a Delaware limited liability company (Collectively “Landlord”),
and Eschelon Telecom, Inc., a Delaware Corporation (“Tenant)”).

 

R E C I T A L S:

 

A.        Landlord and Tenant
entered into that certain Office Lease dated as of December 1, 1999, and First
Amendment To Lease as of March 17, 2003, pursuant to which Landlord leased to
Tenant and Tenant leased from Landlord certain “Premises” as described in the
Lease, known as Suite 500 & 550 of the Building located at 2600 N. Central
Avenue, Phoenix, AZ 85004.

 

B.        Except as otherwise set
forth herein, all capitalized terms used in this Second Amendment shall have
the same meaning as such terms in the Lease.

 

C.        Landlord
and Tenant desire to add rentable square footage to the Premises.

 

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

 

1.         Rentable Area of
Expanded Premises. The Expanded Premises, as built out per Exhibit A
attached hereto, shall comprise 1,923 rentable square feet in Suite 620.

 

2.         Target Commencement
Date. The parties hereby agree that the Target Commencement Date shall be
August 1, 2005. The lease shall commence upon substantial completion of the
Tenant Improvements and the Tenant taking occupancy of the premises.

 

3.         Initial
Base Rent. Base Rent for the Expanded Premises shall be as follows:

 

 

	
  Month

  	
   

  	
  Annual Rate PSF

  	
   

  	
  Monthly 

  Amount

  	
   

  	
  Annual 

  Amount

  	
   

  
	
  08/01/05 -
  09-30-05

  	
   

  	
  $

  	
  0.00

  	
   

  	
  $

  	
  0.00

  	
   

  	
  $

  	
  0.00

  	
   

  
	
  10/01/05-01/31/06

  	
   

  	
  $

  	
  16.50

  	
   

  	
  $

  	
  2,644.13

  	
   

  	
  $

  	
  31,729.50

  	
   

  
	
  02/01/06
  -04/31/07

  	
   

  	
  $

  	
  17.00

  	
   

  	
  $

  	
  2,724.25

  	
   

  	
  $

  	
  32,691.00

  	
   

  
	
  02/01/07-01/31/08

  	
   

  	
  $

  	
  17.50

  	
   

  	
  $

  	
  2,804.38

  	
   

  	
  $

  	
  33,652.5

  	
   

  
	
  02/01/08-01/31/09

  	
   

  	
  $

  	
  18.00

  	
   

  	
  82,884.50

  	
   

  	
  $

  	
  34,614.00

  	
   

  
	
  02/01/09-
  01/31/10

  	
   

  	
  $

  	
  18.50

  	
   

  	
  $

  	
  2,964.63

  	
   

  	
  $

  	
  35,575.50

  	
   

  
	
  02/01/10-05/15/10

  	
   

  	
  $

  	
  19.00

  	
   

  	
  $

  	
  3,044.75

  	
   

  	
  $

  	
  36,537.00

  	
   

  

 

4.         Tenant Share of
Operating Expenses. Tenant’s share of operating expenses for the Expanded
Premises shall be 0.59%.

 

5.         Improvements.
Landlord shall deliver to Tenant the Expanded Premises in as-is-where-is
condition.

 

6.         No Further Modification. Except as
set forth in this First Amendment, all of the terms and provisions of the Lease
shall remain in full force and effect.

 

 

IN WITNESS
WHEREOF, this Second Amendment of Lease has been executed as of the day and
year first above written.

 

“Landlord”

ARI CENTRAL, LP, a Delaware
Limited Partnership

DANARI CENTRAL, LLC a Delaware Limited Liability Company

 

	
  By:

  	
  Adler Realty
  Investments. Inc.

  	
   

  
	
  Title:

  	
  Manager

  

 

	
  

  	
   

  
	
  Title:

  	
  Executive Vice
  President

  	
   

  
			

 

“Tenant”

 

Eschelon Telecom, Inc.

A Delaware Corporation

 

	
  By:

  	
  /s/ Michael A. Donahue

  	
   

  
	
  Title:

  	
  V P Finance and
  Treasurer

  	
   

  

 

 

EXHIBIT ‘A’

 

 

 

FIRST AMENDMENT TO LEASE

 

This First
Amendment to Office Lease (“First Amendment”) is dated for reference purposes
this 17th day of March, 2003, between SOFI IV SIM OFFICE INVESTORS
II, L.P., a Delaware limited partnership (“Landlord”) and ESCHELON TELECOM,
INC., a Delaware corporation, formerly known as Advanced Telecommunications,
Inc., a Delaware corporation (“Tenant”).

 

RECITALS

 

Landlord and
Tenant entered into that certain Office Lease, dated December 1, 1999 the “Lease”,
covering the office space located at the 2600 Tower, located at 2600 North
Central Avenue, Phoenix, Arizona, 85004 (the “Project”), identified as Suite
500 consisting of approximately 6,028 square feet, reduced pursuant to this
First Amendment to 5,545 square feet (the “Existing Premises”).

 

Pursuant to this
First Amendment, Tenant wishes to lease an additional approximately 9,391
rentable square feet located adjacent to the Existing Premises (the “Additional
Premises”) for a period of five (5) years and eight (8) months. Commencing on
the Additional Premises Commencement Date (as defined below), all references to
the “Premises” in the Lease and this First Amendment shall be deemed to refer
collectively to the Existing Premises and the Additional Premises. The Lease
and this First Amendment are collectively referred to as the “Lease”. Upon the
terms and conditions contained herein, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
Landlord and Tenant agree the Lease is amended as follows:

 

AGREEMENT

 

1.         Effective
Date. The effective date of the Lease amendments set out in this First
Amendment is March 17, 2003 (the “Effective Date”).

 

2.         Defined
Terms. Capitalized terms used but not defined herein shall have the
meanings ascribed to them in the Lease.

 

3.         Revised
Summary of Basic Terms. Article I “Summary of Basic Terms” of the Lease is
hereby amended and restated in its entirety with the amended and restated Article
I “Summary of Basic Terms” attached as Schedule 1 attached hereto and
incorporated herein by reference.

 

4.         Lease
of Additional Premises. Upon and subject to the terms and conditions as set
forth in this First Amendment and the Lease, Landlord hereby leases to Tenant
and Tenant hereby leases from Landlord those certain premises consisting of
approximately 9,391 rentable square feet located on the fifth floor adjacent to
the Existing Premises, as depicted on Schedule 2 attached hereto and incorporated
by this reference and described herein as the Additional Premises. The term of
the Lease, as it applies to the Additional Premises, shall commence upon the
earlier of (a) the date of Substantial Completion of the Additional Premises
Tenant Improvements, which is currently estimated to be June 1, 2003 (the “Delivery
Date”); (b) the date Tenant commences business operations in the Additional
Premises; or (c) the date Substantial Completion of the Additional Premises
Tenant Improvements would have occurred but for Tenant Delay (the foregoing
terms are defined in Exhibit A). If Landlord does not tender

 

 

possession of the
Additional Premises to Tenant on or before the Delivery Date, subject to Force
Majeure and Tenant Delay, Landlord will pay to Tenant an amount equal to
$17,897.00 (the “Penalty Fee”) in cash within thirty (30) days of the Delivery
Date. If Landlord is unable to tender possession of the Premises to Tenant on
or before the Delivery Date, the Lease, as it applies to the Additional
Premises, remains in full force and effect and Landlord is not liable to Tenant
for any resulting loss or damage, except for the payment of the Penalty Fee;
provided, however, that unless the delay is caused by Tenant Delay, Additional
Premises Base Rent shall abate on a day-for-day basis for those days (after the
Delivery Date) during which Landlord is unable to tender possession of the
Additional Premises to Tenant. The expiration date of the Lease, as it applies
to the Additional Premises, shall expire on February 1, 2009, unless sooner
terminated pursuant to the provisions of the Lease (the “Additional Premises
Termination Date”). The “Additional Premises Term” of the Lease shall commence
on the Additional Premises Commencement Date and terminate on the Additional
Premises Termination Date.

 

5.         Additional
Premises Tenant Improvements. Tenant acknowledges, represents and agrees to
the following: (i) Tenant shall be responsible for making its own inspection
and investigation of the Additional Premises and other portions of the
Building, (ii) Tenant shall be responsible for investigating and establishing
the suitability of the Additional Premises for Tenant’s intended use thereof,
and all zoning and regulatory matters pertinent thereto, (iii) Tenant is
leasing the Additional Premises “AS IS” based on its own inspection and
investigation after the expiration of the thirty (30) day “punch list” period
and not in reliance on any statement, representation, inducement or agreement
of Landlord or its agents, employees or representatives, except as expressly
set forth elsewhere in the Lease, (iv) the Additional Premises, upon the
earlier of Tenant’s possession or Tenant’s entry into the Additional Premises
to construct or install improvements, were in good order and satisfactory condition,
and (v) no rights to light or air over any property, whether belonging to
Landlord or any other person, are granted to Tenant by this Lease.

 

Landlord shall perform the demolition, remodeling, replacement and/or
installation work provided for on Exhibit A attached hereto (“Additional
Premises Tenant Improvements”). For the purposes of the Lease, as it applies to
the Additional Premises, possession of the Additional Premises shall be deemed
delivered or tendered to Tenant, and accepted by Tenant (subject to Landlord’s
obligation to complete Punch List items), upon Substantial Completion (as those
terms are defined in Exhibit A) and Landlord has given Tenant written notice
thereto.

 

6.         Parking.
Article 3.9 of the Lease is hereby amended and replaced with the following:

 

Existing Premises:

 

	
  #of 

  Spaces

  	
   

  	
  Parking Area

  	
   

  	
  Price per Space

  	
   

  	
  Total

  Price

  
	
  Up to 6

  	
   

  	
  open unreserved

  	
   

  	
  @ then current building rates

  	
   

  	
   

  

 

2

 

Additional
Premises:

 

Landlord shall
license vehicle parking spaces to Tenant and Tenant’s business on the following
terms and conditions:

 

Landlord shall provide eight (8) vehicular parking
spaces as exclusive parking spaces for Tenant and its employees in the parking
garage portion of the Office Complex (“Reserved Covered Spaces”). This license
is for Reserved Covered Spaces in the general parking area to be designated and
redesignated from time to time by Landlord; provided, however, Landlord may
require Tenant to park in a specific location. Landlord shall not be liable to
Tenant for the failure of any of its tenants, invitees, employees, agents or
customers or any third parties to comply with the designation of the Reserved
Covered Spaces.

 

Landlord shall provide thirty-two (32) vehicular
parking spaces on a covered unreserved basis for Tenant and its employees in
the unreserved portion of the parking garage portion of the Office Complex (the
“Unreserved Covered Spaces”). This license is for Unreserved Covered Spaces in
the general parking area to be designated and redesignated from time to time by
Landlord; provided, however, Landlord may require Tenant to park in a specific
location. Landlord shall not be liable to Tenant for the failure of any of its
tenants, invitees, employees, agents or customers or any third parties to
comply with the designation of the Unreserved Covered Spaces.

 

Landlord shall provide ten (10) vehicular parking
spaces on an unreserved basis for Tenant and its employees in the surface
parking facility serving the Office Complex (“Surface Spaces”). This license is
for Surface Spaces in the unreserved portion of the surface parking lot to be
designated and redesignated from time to time by Landlord; provided, however,
Landlord may require Tenant to park in a specific location. Landlord shall not
be liable to Tenant for the failure of any of its tenants, invitees, employees,
agents or customers or any third parties to comply with the designation of the
Surface Spaces.

 

The parking fees for the Reserved Covered Spaces, the
Unreserved Covered Spaces and the Surface Spaces, as they relate to the
Additional Premises, shall be abated for the first forty-one (41) months of the
Additional Premises Term hereof; provided, however, that all other charges
related to parking (such as charges for parking garage access devices and name
plates for reserved spaces) shall be paid for by Tenant upon receipt of invoice
from Landlord. Thereafter, Tenant agrees to pay as a monthly fee for such
license of parking spaces payable on or before the first day of each month in
advance as follows: during the last twenty-four (24)

 

3

 

months of the
Additional Premises Term, $1,000.00 each month for the parking spaces relating
to the Additional Premises. Tenant shall be entitled to fifty (50) hours of
parking validation each month for the Additional Premises Term at no charge to
Tenant. If the Lease, as it relates to the Additional Premises, is terminated
for any reason, the Tenant’s license as to the parking spaces relating to the
Additional Premises shall be immediately revoked.

 

Only vehicles designated by Tenant to Landlord may be
parked or stored therein; provided, however, that Tenant may change its
automobile designations at any time upon written notice to Landlord or for
temporary use upon notification given to the garage attendant, if any. No more
than one automobile per space licensed hereunder shall be parked or stored
under Tenant’s rights hereunder at any one time.

 

This license is for self-service storage or parking
only and does not include the rights to any additional services, which services
may be made available by Landlord from time to time at an additional charge.

 

It is understood that Landlord and its agents and
employees shall not be liable for loss or damage to any vehicle parked or
stored by Tenant or under Tenant’s rights herein and/or to the contents thereof
caused by fire, theft, explosion, freezing of circulation system of any
automobile, strikes, riots or by any other causes and Tenant (1) waives any
claim against Landlord for and in respect thereto, and (2) hereby agrees to
indemnify and defend Landlord against all claims for any loss or damage to any
such vehicle or its contents from any cause whatsoever. It is further expressly
understood that the relationship between Landlord and Tenant with respect to
the parking spaces constitutes a license to use said garage subject to the
terms and conditions herein only and that neither such relationship nor the
storage or parking of any automobile thereunder shall constitute a bailment nor
create the relationship of bailor and bailee.

 

In the event the garage referenced shall be damaged by
fire or other casualty rendering it unusable by Tenant, the fee provided for
herein shall be abated (pro rata based on the portion of the Tenant’s stalls
which are unusable) from the date ten (10) days after the date the garage
becomes unusable until it again becomes usable. Further, if all or any part of
the garage is taken by eminent domain proceedings, Landlord shall be entitled
to all of the award in the proceedings and may terminate this parking
arrangement in the event of a total taking or reduce the number of stalls
licensed hereunder in proportion to the extent of any partial taking upon

 

4

 

written notice to
Tenant. If the garage is damaged by fire or other casualty, Landlord will cause
it to be repaired with due diligence.

 

Subject to the abatement
provided for in the preceding paragraph, Landlord shall have the right to close
any portion of the garage and deny access thereto in connection with any
repairs or in an emergency, as it may require, without liability, cost or
abatement of fee.

 

Tenant shall perform, observe
and comply with such rules of the Office Complex as may be reasonably adopted
by Landlord in respect to the use and operation of said garage.

 

Tenant shall, when using the
parking facilities of said garage, observe and obey all signs regarding fire
lanes and no parking zones, and when parking always park between designated
lines. Landlord reserves the right to tow away, or otherwise impound, at the
expense of the owner or operator, any vehicle which is improperly parked or
parked in a no parking zone.

 

In the event a key
or other access device is supplied by Landlord to Tenant in connection with the
rights granted herein, Tenant will surrender such key or access device to
Landlord upon termination of this Lease.

 

7.         Right
to Terminate. Provided that the Lease is then in full force and effect and
Tenant is not in default, on the date of exercise of this Option, after notice
and the expiration of any applicable grace period, Tenant may terminate the
Lease, as it applies to the Additional Premises, as of the last day of the 44th
month following the Additional Premises Commencement Date (the “Early
Termination Date”) subject to and in accordance with this Section 7. To
exercise such termination right, Tenant must (a) deliver written notice to
Landlord that Tenant desires to terminate the Lease, as it applies to the
Additional Premises, as of the Early Termination Date at least ninety (90) days
prior to the Early Termination Date; and (b) immediately pay Landlord a
payment, as each relates to the Additional Premises, equal to Landlord’s then
unamortized costs of the Additional Premises Tenant Improvements, moving
allowance, leasing commissions and two (2) months Additional Premises Base Rent
at the rate then in effect. If Tenant terminates the Lease, as it applies to
the Additional Premises, Landlord, at its sole cost and expense, shall restore
that portion of the demising wall that separated the Existing Premises from the
Additional Premises to its condition existing prior to the construction of the
Additional Premises and Tenant agrees to allow Landlord to temporarily occupy
the Existing Premises in order to accomplish such construction.

 

8.         Tenant’s
Option to Renew the Additional Premises Term.

 

(A)      Provided that the Lease is
then in full force and effect and Tenant is not in default, on the date of
exercise of this Option, after notice and the expiration of any applicable
grace period, Tenant shall have the option to extend the Additional Premises
Term of the Lease for one

 

5

 

(1) period of
three (3) years (the “Additional Premises Extension Term”) by notice given to
Landlord at least four (4), but no more than twelve (12), months prior to the
termination of the Additional Premises Term. The Additional Premises Extension
Term shall commence on the first day after the initial Additional Premises Term
and shall expire on the third (3rd) anniversary of such day unless
the Additional Premises Extension Term shall sooner end pursuant to the Lease.

 

(B)      The terms and conditions
shall be identical to those in the Lease that relate to the Additional Premises
except for the rental rate, which shall be determined in accordance with
Article 26.13 (1)(A) of the Lease.

 

9.         Tenant’s
Option to Renew the Existing Premises Term: Article 26.13(1)(A) of the
Lease is hereby amended and replaced with the following:

 

(A)      Provided
that the Lease is then in full force and effect and Tenant is not in default,
on the date of exercise of this Option, hereunder after notice and the
expiration of any applicable grace period, Tenant shall have the option to
extend the Term for two (2) additional periods of five (5) years each (the “Extension
Term(s)”) by notice given to Landlord at least four (4), but no more than
twelve (12), months prior to the termination of the Term. The Extension Term(s)
shall commence on the day after the initial Lease term and the prior Extension
Term (if any) expires (“Expiration Date(s)”) and shall expire on the fifth (5th)
anniversary of the Expiration Date(s) unless the Extension Term(s) shall sooner
end pursuant to this Lease.

 

10.       Signage.
Article 14 of the Lease is hereby amended and replaced with the following:

 

ARTICLE 14. SIGNS

 

Landlord to
provide to Tenant (a) one building standard tenant identification sign adjacent
to the entry door of the Premises and (b) standard building directory listings
on the directories in the main lobby. In the event Landlord installs an
exterior monument sign and provided Tenant, at its sole cost and expense,
receives all necessary governmental and quasi-governmental approvals therefore,
Landlord will allow Tenant, at Tenant’s sole cost and expense, to install one
non-illuminated sign on such exterior monument sign, which sign will be Tenant’s
name, “subordinate” to Landlord’s building designation sign, if any. Tenant
must pay all governmental and other permit fees at its sole cost and expense,
must remove same prior to termination of the Lease, and must repair and restore
any damage to the Building caused by such installation and/or removal. Any such
sign and the display of Tenant’s name thereon will be subject to the terms of
any restrictive covenants applicable thereto and all laws.

 

11.       HVAC.
Article 27(A) of the Lease is hereby amended with the addition of the
following:

 

Subject to
limitations imposed by governmental rules, regulations and guidelines
applicable thereto, Landlord shall provide HVAC when necessary for normal
comfort and normal office use in the Premises during Normal Business Hours. If

 

6

 

Tenant uses HVAC
in excess of that supplied by Landlord pursuant to this Article 27(A), Tenant
shall pay to Landlord, upon billing, the actual cost of such of such excess
consumption, provided, however, that after-hours HVAC usage shall be billed to
Tenant based upon rates as reasonably established by Landlord from time to
time, which rates are currently estimated to be $8.50 per hour per Zone (as
hereinafter defined). A zone covers approximately 1200 square feet (a “Zone”)
and each floor contains 13 Zones. Tenant shall be entitled to a credit equal to
twenty (20) hours excess HVAC usage each month for the Additional Premises
during the Additional Premises Term. Any unused credits for any Zone in any
month may not be carried forward or applied to any other Zone or any other
month.

 

12.       Moving
Expenses. The following is added as a new Article 36:

 

ARTICLE 36. MOVING
EXPENSES

 

In connection with
Tenant’s relocation of the Tenant’s personal property to the Additional
Premises, Landlord will pay to Tenant an amount equal to $1.50 per rentable square
foot of the Additional Premises. Such moving allowance will be paid by Landlord
to Tenant in cash within 30 days of the Additional Premises Commencement Date.

 

13.       Storage.         If
requested by Tenant and to the extent available, Landlord to provide storage
space in the parking facilities portion of the Building, for Tenant’s exclusive
use as storage for personal property used in connection with Tenant’s occupancy
of the Premises. The location of the storage space will be determined by
Landlord in its sole discretion. Tenant will pay Landlord annually $12.00 per
square foot of storage space for the storage space, payable monthly in advance,
in equal installments at the same time and manner as Existing Premises Base
Rent or Additional Premises Base Rent, as applicable.

 

14.       Brokerage.
Article 24 of the Lease is hereby amended with the addition of the following:

 

“Landlord will pay
any brokers named in Section 1.16 in accordance with the applicable listing
agreement for the Building.”

 

15.       Operating
Costs. With respect to the Additional Premises, for each calendar year,
Tenant’s obligation to pay Operating Costs shall not increase, on an annual and
cumulative basis, by an amount greater than five percent (5.0%) per year
following the initial lease year.

 

16.       Existing
Premises Rentable Square Footage. The rentable square footage of the
Existing Premises is hereby reduced from 6,028 to 5,545.

 

7

 

IN WITNESS WHEREOF, Landlord and Tenant have executed this First
Amendment to the Lease on the date first written above.

 

 

	
   

  	
   

  	
  Landlord:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  SOFI IV-SPM PORTFOLIO
  XI, L.L.C., a 

  Delaware limited liability company

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By: 

  	
  SOFI
  IV-SPM Maricopa, L.P., General 

  Manager

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
  SOFI IV ARIZONA TRUST, 

  General Partner

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  By:

  	
  /s/ Mark M. Grumley

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Name:

  	
  Mark M. Grumley

  
	
   

  	
   

  	
   

  	
   

  	
  Title:

  	
  Vice President

  
								

 

 

 

	
   

  	
   

  	
  Tenant:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  ESCHELON
  TELECOMMUNICATIONS, INC., a Delaware corporation, formerly known as Advanced
  Telecommunications, Inc., a Delaware corporation

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Michael A. Donahue

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Michael A. Donahue

  	
   

  
	
   

  	
   

  	
  Its:

  	
  V P Finance and
  Treasurer

  	
   

  

 

 

SCHEDULE 1

 

ARTICLE 1 SUMMARY OF
BASIC TERMS

 

1.1       The
Existing Premises: Suite #500 in the building consisting of approximately 5,545
square feet of rentable area as illustrated on the attached Exhibit A; The
Additional Premises: Suite #550 in the Building consisting of approximately
9,391 rentable square feet of rentable area as illustrated on the attached
Exhibit A. A floor plan for the floor(s) on which the Premises is located is
attached as Exhibit A-l.

 

1.2       The
Building: The building is located at 2600 North Central Avenue, Phoenix,
Arizona.

 

1.3       “Project”
means the Building identified in Section 1.2, and all lands and facilities used
in connection with the Building as reasonably determined from time to time by
Landlord. The Project consists of approximately 322,000 square feet of rentable
area.

 

1.4       Names
of Guarantors: None.

 

1.5       Existing
Premises Security Deposit: $12,000.00; Additional Premises Security Deposit: $0
(see provisions of Article 4)

 

1.6       The
Existing Premises Term: Ten (10) years and four (4) months, beginning on the
Commencement Date and ending on the Expiration Date; The Additional Premises
Term: Five (5) years and eight (8) months, beginning on the Additional Premises
Commencement Date and ending on the Additional Premises Expiration Date.

 

1.7       Existing
Premises Commencement and Expiration Dates: January 15, 2000, and May 15, 2010,
respectively, subject to the provisions of Exhibit A; Additional Premises
Commencement and Expiration Dates: June 1, 2003 and February 1, 2009.

 

1.8       Existing
Premises Base Rent:

 

	
  Lease Year

  	
   

  	
  Annual Base Rent

  	
   

  	
  Base Rent Per Square Foot

  	
   

  	
  Monthly Base Rent

  	
   

  
	
  1

  	
   

  	
  $

  	
  120,560.00

  	
   

  	
  $

  	
  20.00/sq. ft.

  	
   

  	
  $

  	
  10,046.67

  	
   

  
	
  2

  	
   

  	
  $

  	
  124,176.80

  	
   

  	
  $

  	
  20.60/sq. ft.

  	
   

  	
  $

  	
  10,348.07

  	
   

  
	
  3

  	
   

  	
  $

  	
  127,914.16

  	
   

  	
  $

  	
  21.22/sq. ft.

  	
   

  	
  $

  	
  10,659.51

  	
   

  
	
  Month 36 –
  Additional Premises Commencement Date

  	
   

  	
  $

  	
  131,772.08

  	
   

  	
  $

  	
  21.86/sq. ft.

  	
   

  	
  $

  	
  10,981.01

  	
   

  
	
  Additional
  Premises

  	
   

  	
  $

  	
  121,213.70

  	
   

  	
  $

  	
  21.86/sq. ft.

  	
   

  	
  $

  	
  10,101.14

  	
   

  

 

 

	
  Lease Year

  	
   

  	
  Annual Base Rent

  	
   

  	
  Base Rent Per Square Foot

  	
   

  	
  Monthly Base Rent

  	
   

  
	
  Commencement
  Date – Month 42

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  5

  	
   

  	
  $

  	
  124,873.40

  	
   

  	
  $

  	
  22.52/sq. ft.

  	
   

  	
  10,406.12

  	
   

  
	
  6

  	
   

  	
  $

  	
  128,644.00

  	
   

  	
  $

  	
  23.20/sq. ft.

  	
   

  	
  $

  	
  10,720.33

  	
   

  
	
  7

  	
   

  	
  $

  	
  132,525.50

  	
   

  	
  $

  	
  23.90/sq. ft.

  	
   

  	
  $

  	
  11,043.79

  	
   

  
	
  8

  	
   

  	
  $

  	
  136,517.90

  	
   

  	
  $

  	
  24.62/sq. ft.

  	
   

  	
  $

  	
  11,376.49

  	
   

  
	
  9

  	
   

  	
  $

  	
  140,621.20

  	
   

  	
  $

  	
  25.36/sq. ft.

  	
   

  	
  11,718.43

  	
   

  
	
  10

  	
   

  	
  $

  	
  144,835.40

  	
   

  	
  $

  	
  26.12/sq. ft.

  	
   

  	
  $

  	
  12,069.62

  	
   

  

 

Additional Premises Base Rent:

 

	
  Lease Months

  	
   

  	
  Annual Base Rent

  	
   

  	
  Base Rent Per Square Foot

  	
   

  	
  Monthly Base Rent

  	
   

  
	
  01-08

  	
   

  	
  $

  	
  0

  	
   

  	
  $

  	
  0

  	
   

  	
  $

  	
  0

  	
   

  
	
  09-20

  	
   

  	
  $

  	
  154,951.50

  	
   

  	
  $

  	
  16.50/sq. ft.

  	
   

  	
  $

  	
  12,912.63

  	
   

  
	
  21-32

  	
   

  	
  $

  	
  159,647.00

  	
   

  	
  $

  	
  17.00/sq. ft.

  	
   

  	
  $

  	
  13,303.92

  	
   

  
	
  33-44

  	
   

  	
  $

  	
  164,342.50

  	
   

  	
  $

  	
  17.50/sq. ft.

  	
   

  	
  $

  	
  13,695.21

  	
   

  
	
  45-56

  	
   

  	
  $

  	
  169,038.00

  	
   

  	
  $

  	
  18.00/sq. ft.

  	
   

  	
  $

  	
  14,086.50

  	
   

  
	
  57-68

  	
   

  	
  $

  	
  173,733.50

  	
   

  	
  $

  	
  18.50/sq. ft.

  	
   

  	
  $

  	
  14,477.79

  	
   

  

 

1.9       Tenant’s
Proportionate Share: 1.72% for the Existing Premises and 2.92% for the
Additional Premises, consisting of the proportion that the rentable area of the
Existing Premises or the Additional Premises, as applicable, bears to the
rentable area of the Project.

 

1.10     Existing
Premises Base Year: 2000; Additional Premises Base Year: 2003

 

1.11     Description
of Tenant’s Business: Executive and general office use, the installation,
operation and maintenance of equipment and facilities in connection with Tenant’s
telecommunication business, including but not limited to telecommunications
switch.

 

1.12     Normal
Business Hours: 7:00 a.m. to 6:00 p.m., Monday through Friday, 8:00 a.m. to
1:00 p.m. on Saturday.

 

2

 

1.13     Additional
Premises Tenant Improvement Allowance: Landlord to deliver the Additional
Premises to Tenant “turnkey” per space plan prepared by Mittelstaedt Cooper
& Associates dated January 8, 2003, using building standard materials (“Original
Plan”). Notwithstanding anything to the contrary contained herein, Landlord’s
obligation relating to the Additional Premises Tenant Improvements shall be
limited to costs per Original Plan.

 

1.14     Landlord
shall commence construction of the fifth floor common area remodel (“Common
Area Improvements”) within thirty (30) days after completion of the Additional
Premises Tenant Improvements and shall, at Landlord’s sole expense, complete the
Common Area Improvements in a timely manner, subject to Force Majeure and
Tenant Delay.

 

1.15     Additional
Premises Load Factor: 6%.

 

1.16     Tenant’s
Address for Pre-occupancy Notices:

 

730 2nd
Avenue South, #1200

Minneapolis, MN 55402

 

1.17     Landlord’s
Notice Address:

 

Starwood Asset
Management 

2525 East Camelback Road 

Suite 740

Phoenix, AZ 85016 

Attn.: Mark M. Grumley 

Phone: (602) 468-0112 

Facsimile: (602) 468-1567

 

Copy to:

 

Rinaldi,
Finkelstein & Franklin, LLC 

591 West Putnam Avenue 

Greenwich, CT 06830 

Attn.: Eric W. Franklin, Esq. 

Phone: (203) 422-7768 

Facsimile: (203) 422-7868

 

Copy to:

 

CB Richard Ellis 

2415 East Camelback Road 

Ground Floor 

Phoenix, AZ 85016 

Attn.: Asset Service 

Phone: (602) 735-5445

 

3

 

Facsimile: (602)
735-5113

 

1.18     Existing
Premises Landlord’s designated broker: Scottsdale Property Manager 97, L.L.C;
Additional Premises Landlord’s designated broker: CB Richard Ellis, Inc.

 

1.19     Existing
Premises Tenant’s designated broker: Eric Hamm, TELECOM Real Estate Services;
Additional Premises Tenant’s designated broker: CRESA Partners

 

4

 

SCHEDULE “2”

 

Floor Plan

 

5

 

EXHIBIT “A”

 

CONSTRUCTION OF ADDITIONAL
PREMISES TENANT IMPROVEMENTS

 

1.         Additional Premises
Tenant Improvements. Landlord will cause to be constructed all Additional
Premises Tenant Improvements. The Additional Premises Tenant Improvements will
be designed as described in this Exhibit A. The cost of constructing the
Additional Premises Tenant Improvements will include all of Landlord’s direct
and indirect costs in connection with the design and construction of the
Additional Premises Tenant Improvements initially to be constructed in the
Additional Premises, plus a percentage (not to exceed five percent [5%]) of the
sum of all such direct and indirect costs for Landlord’s overhead and profit.
Such costs of Landlord may include, without limitation, space planning costs,
construction document preparation costs, design costs, construction drawing
costs, general conditions, construction costs and all costs Landlord incurs in
connection with obtaining permits for the Additional Premises Tenant
Improvements. The Additional Premises Tenant Improvements become the property
of Landlord and a part of the Property immediately upon installation. Landlord
agrees to use reasonable efforts to competitively bid the work for the
construction of the Additional Premises Tenant Improvements.

 

2.         Additional Premises
Tenant Improvement Allowance. Landlord will pay an amount equal to the cost
to deliver the Additional Premises to Tenant “turnkey” per space plan prepared
by Mittelstaedt Cooper & Associates dated January 8, 2003, using building
standard materials (“Original Plan”) (the “Additional Premises Improvement
Allowance”), for the design and installation of the Additional Premises Tenant
Improvements. Landlord is not obligated to pay or incur any amounts that exceed
the Additional Premises Improvement Allowance. If the cost of the Additional
Premises Tenant Improvements exceeds the Additional Premises Improvement
Allowance, then Tenant will pay the excess to Landlord in cash within ten (10)
days after demand. Tenant will also pay all of Landlord’s costs (including lost
rent) resulting from any Tenant Delay. If Landlord at any time reasonably
estimates that the cost of the Additional Premises Tenant Improvements will
exceed the Additional Premises Improvement Allowance, Tenant shall immediately
deposit with Landlord the amount by which the cost of the Additional Premises
Tenant Improvements exceeds the Additional Premises Improvement Allowance.

 

3.         Space Plan.
[Intentionally Deleted].

 

4.         Additional Premises
Construction Drawings. Landlord will provide Tenant with the Additional
Premises Construction Drawings and Specifications. Tenant will approve or
disapprove (specifically describing any reasons for disapproval) the Additional
Premises Construction Drawings and Specifications in writing within three (3)
business days after receiving them. Any failure by Tenant to timely deliver
such approval or disapproval is a Tenant Delay until received. If Tenant
disapproves the Additional Premises Construction Drawings and Specifications,
Landlord will provide appropriately revised Additional Premises Construction
Drawings and Specifications to Tenant for approval (or disapproval) on the same
basis as set forth above. If the review and approval process is not concluded
(with Tenant having approved

 

 

the Additional
Premises Construction Drawings and Specifications) on or before          ,
2003, then such delay is a Tenant Delay until Tenant’s approval is received.
After Tenant’s approval, Landlord will submit the Additional Premises
Construction Drawings and Specifications for permits and construction bids.
Tenant will not withhold any approval except for reasonable cause and will not
act in an arbitrary or capricious manner in connection with the review,
revision, approval or disapproval of the Additional Premises Construction
Drawings and Specifications. Tenant will not specify long lead time items that
would delay Substantial Completion of the Additional Premises Tenant
Improvements.

 

5.         Change Orders.
Tenant will immediately notify Landlord if Tenant desires to make any changes
to the Additional Premises Tenant Improvements after Tenant has approved the
Additional Premises Construction Drawings and Specifications. If Landlord
approves the revisions, Landlord will notify Tenant of the anticipated
additional cost and delay in completing the Additional Premises Tenant
Improvements that would be caused by such revisions. Tenant will approve or
disapprove the increased cost and delay within five (5) business days after
such notice. If Tenant approves, Landlord will prepare, and Landlord and Tenant
will execute, a Change Order describing the revisions and the anticipated
additional cost and delay. Any delay relating to a request for revisions or a
Change Order is a Tenant Delay. If the Change Order causes the cost of the Additional
Premises Tenant Improvements to exceed the Additional Premises Improvement
Allowance (or if the cost of the Additional Premises Tenant Improvements
already exceeds the Additional Premises Improvement Allowance), Tenant shall
prepay the added costs of the Change Order.

 

6.         Substantial
Completion: Punch List. As used in this Lease, “Substantial Completion”
means the earlier to occur of the following: (a) the issuance of all final
unconditional approvals and green tags by the governmental authority exercising
jurisdiction over the Additional Premises Tenant Improvements signifying the
final and unconditional acceptance and approval of the Additional Premises
Tenant Improvements, (b) the date a Certificate of Occupancy is issued for the
Additional Premises, and (c) if a Certificate of Occupancy is not required, the
date Tenant is reasonably able to take occupancy of the Additional Premises;
provided that if either (a), (b) or (c) is delayed or prevented because of work
Tenant is responsible for performing in the Additional Premises, “Substantial
Completion” means the date that all of Landlord’s work which is necessary for
either (a), (b) or (c) to occur has been performed and Landlord has made the
Additional Premises available to Tenant for the performance of Tenant’s work.
Within thirty (30) days after Substantial Completion, Landlord and Tenant will
inspect the Additional Premises and develop a Punch List. Landlord will cause
the items listed on the Punch List to be completed with commercially reasonable
diligence and speed, subject to Tenant Delay and Force Majeure. If Tenant
refuses to inspect the Additional Premises with Landlord within the 30-day
period, Tenant is deemed to have accepted the Additional Premises as delivered.
Tenant will not occupy the Additional Premises before Substantial Completion
without Landlord’s prior written consent, which consent Landlord may grant,
withhold or condition in its sole and absolute discretion. If Landlord
consents, during the early occupancy period Tenant may only install Tenant’s
furniture, fixtures and equipment in the Additional Premises and must comply
with and observe all terms and conditions of this Lease (other than Tenant’s
obligation to pay Additional Premises Base Rent).

 

7

 

7.         Force Majeure. As
used in this Lease, “Force Majeure” means acts of God; strikes; lockouts; labor
troubles; inability to procure materials; inclement weather; governmental laws
or regulations; casualty; orders or directives of any legislative,
administrative, or judicial body or any governmental department; inability to
obtain any governmental licenses, permissions or authorities (despite
commercially reasonable pursuit of such licenses, permissions or authorities);
and other similar or dissimilar causes beyond Landlord’s reasonable control.

 

8.         Tenant Delay. “Tenant
Delay” means any delay caused or contributed to by Tenant, including, without
limitation, with respect to the Additional Premises Tenant Improvements, Tenant’s
failure to timely prepare or approve the Additional Premises Construction
Drawings and Specifications, and any delay from any revisions Tenant proposes
to approved Additional Premises Construction Drawings and Specifications. A
Tenant Delay excuses Landlord’s performance of any obligation related thereto
for a period equal to (a) the duration of the act, occurrence or omission that
constitutes the Tenant Delay, or (b) if longer, the period of delay actually
caused by such Tenant Delay.

 

8Exhibit 10.32

 

EXECUTION VERSION

 

AMENDMENT NO. 7 TO CREDIT
AGREEMENT

 

This Amendment No. 7
to Credit Agreement, dated as of March 15, 2006 (this “Amendment”), is
entered into by and among Blue Ridge Paper Products Inc., a Delaware
corporation (“Borrower”), as Borrower; Blue Ridge Holding Corp., a Delaware
corporation (“Holdings”), as a Credit Party; BRPP, LLC, a North Carolina
limited liability company (the “IP Subsidiary”), as a Credit Party; and General
Electric Capital Corporation, as a Lender and as Agent for Lenders (in such
capacity, “Agent”).

 

RECITALS

 

A.                                   Borrower, Holdings, the IP Subsidiary,
Agent and Lender are parties to that certain Credit Agreement, dated as of December 17,
2003 (as amended by Amendment No. 1 thereto, dated as of February 17,
2004, Amendment No. 2 thereto, dated as of September 15, 2004,
Consent and Amendment No. 3 thereto, dated as of October 8, 2004,
Amendment No. 4 thereto, dated as of October 8, 2004, Amendment No. 5
thereto, dated as of December 21, 2004, Amendment No. 6 thereto,
dated as of August 5, 2005, and as from time to time hereafter further
amended, restated, supplemented or otherwise modified and in effect, the “Credit
Agreement”), pursuant to which Lender has made and will hereafter make loans
and advances and other extensions of credit to Borrower.

 

B.                                     Borrower, Agent and Lender are desirous
of amending the Credit Agreement as and to the extent set forth herein and
subject to the terms and conditions set forth herein.

 

C.                                     This Amendment shall constitute a Loan Document
and these Recitals shall be construed as part of this Amendment. Capitalized
terms used herein without definition are so used as defined in the Credit
Agreement and Annex A thereto.

 

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

 

1.                                       Amendments
to Credit Agreement.

 

1.1.                              Paragraph
(c) of Annex C (Cash Management System) to the Credit Agreement is amended
by amending and restating in its entirety the definition of “Activation
Event” set forth in the parenthetical at the end of clause (iii) of
such paragraph as follows:

 

“any time at which (1) a
Default or Event of Default has occurred and is continuing or (2) Borrowing
Availability at such time is less than $5,000,000 (any of the foregoing being
referred to herein as an “Activation Event”).”

 

 

1.2.                              Paragraph
(b) of Annex G (Financial Covenants) to the Credit Agreement is amended
and restated in its entirety as follows:

 

“(b)                           Minimum
Fixed Charge Coverage Ratio. If Borrowing Availability falls below
$5,000,000, then, for the most recently ended Fiscal Quarter and for each
Fiscal Quarter thereafter, Borrower and its Subsidiaries shall have on a
consolidated basis at the end of each such Fiscal Quarter, a Fixed Charge
Coverage Ratio for the 12-month period then ended of not less than 1.10 to
1.00.”

 

2.                                       Representations
and Warranties. Borrower represents and warrants to Agent and Lender that
the execution, delivery and performance by Borrower of this Amendment (a) have
been duly authorized by all necessary action on the part of Borrower, and (b) do
not and will not conflict with, result in the breach or termination of, constitute
a default under, or accelerate or permit the acceleration of any performance
required by, any indenture (including, without limitation, the Senior Secured
Notes Indenture), mortgage, deed of trust, lease, agreement or other instrument
to which Borrower is a party.

 

3.                                       Conditions
to Effectiveness. The effectiveness of this Amendment is expressly
conditioned upon the satisfaction of each of the following conditions precedent
in a manner acceptable to Agent:

 

3.1.                              Agent’s
receipt of counterparts of this Amendment, duly executed by Borrower, Holdings,
the IP Subsidiary, Agent and Lender.

 

3.2.                              No
Default or Event of Default shall have occurred and be continuing or would
result from the effectiveness of this Amendment.

 

3.3.                              The
representations and warranties contained in Section 2 of this
Amendment shall be true, correct and complete.

 

4.                                       Reference
to and Effect Upon the Credit Agreement and other Loan
Documents.

 

4.1.                              The
Credit Agreement, the Notes and each other Loan Document shall remain in full
force and effect and each is hereby ratified and confirmed by Borrower,
Holdings and the IP Subsidiary. Without limiting the foregoing, the Liens
granted pursuant to the Collateral Documents shall continue in full force and
effect and the guaranties of Holdings and the IP Subsidiary shall continue in
full force and effect.

 

4.2.                              Each
reference in the Credit Agreement to “this Agreement”, “hereunder”, “hereof”, “herein”
or any other word or words of similar import shall mean and be a reference to
the Credit Agreement as amended hereby, and each reference in any other Loan
Document to the Credit Agreement or any word or words of similar import shall
be and mean a reference to the Credit Agreement as amended hereby.

 

5.                                       Counterparts.
This Amendment may be executed in any number of counterparts, each of
which when so executed shall be deemed an original but all such counterparts
shall constitute

 

 

one
and the same instrument. A counterpart signature page delivered by
fax transmission shall be as effective as delivery of an originally executed
counterpart.

 

6.                                       Costs
and Expenses. As provided in Section 11.3 of the Credit Agreement,
Borrower shall pay the fees, costs and expenses incurred by Agent in connection
with the preparation, execution and delivery of this Amendment (including,
without limitation, reasonable attorneys’ fees).

 

7.                                       GOVERNING
LAW. THIS AMENDMENT SHALL BE GOVERNED BY AND CONSTRUED AND ENFORCED IN
ACCORDANCE WITH THE INTERNAL LAWS (AS OPPOSED TO CONFLICTS OF LAW PROVISIONS)
OF THE STATE OF NEW YORK.

 

8.                                       Headings.
Section headings in this Amendment are included herein for convenience of
reference only and shall not constitute a part of this Amendment for any
other purpose.

 

[SIGNATURE PAGE FOLLOWS]

 

 

IN
WITNESS WHEREOF, this Amendment has been duly executed as of the date first
written above.

 

 

	
   

  	
  BLUE
  RIDGE PAPER PRODUCTS INC., as Borrower

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ JOHN B.
  WADSWORTH

  	
   

  
	
   

  	
  Title:

  	
  Chief Financial
  Officer

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  BLUE
  RIDGE HOLDING CORP., as a Credit Party

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ JOHN B.
  WADSWORTH

  	
   

  
	
   

  	
  Title:

  	
  Chief Financial
  Officer

  	
   

  
	
   

  	
   

  
	
   

  	
  BRPP,
  LLC, as a Credit Party

  
	
   

  	
  By:

  	
  Blue Ridge Paper
  Products Inc., sole Member and

  Manager

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ JOHN B.
  WADSWORTH

  	
   

  
	
   

  	
  Title:

  	
  Chief Financial
  Officer

  	
   

  
	
   

  	
   

  
	
   

  	
  GENERAL
  ELECTRIC CAPITAL  CORPORATION,

  
	
   

  	
  as Agent and
  Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ JAMES R.
  PUSO

  	
   

  
	
   

  	
  Title: Duly
  Authorized Signatory

  
							

 

 

 

 

AMENDMENT
NO. 7 TO CREDIT AGREEMENT

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00100-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00100-of-00352.parquet"}]]