Document:

exv10w35

Exhibit 10.35

THIRD AMENDMENT TO LEASE

     THIS
THIRD AMENDMENT TO LEASE (this “Amendment”)
 is executed as of October 23rd,
2009 (the “Effective Date”), by Turtle Creek Limon, LP, a Texas limited partnership (successor in
interest to 3400 Carlisle, Ltd.)
(“Landlord”), and Archipelago Learning, LLC (formerly known as
Study Island, LLC), a Delaware limited liability company
(“Tenant”).

BACKGROUND

     A. Landlord and Tenant entered into an Office Lease commencing May 23, 2003 (the
“Original Lease”) for certain office space known as “Suite 345” in the building at 3400
Carlisle (the “Building”), as more particularly described in the Original Lease.

     B. On October 28, 2004, Landlord and Tenant entered into the First Amendment to Lease
(the “First Amendment”) amending the Original Lease to relocate Tenant to another location
(also known as “Suite 345”), which contains approximately 2,939 rentable square feet.

     C. On March 2, 2006, Landlord and Tenant entered into the Second Amendment to Lease
(the “Second Amendment”) amending the Original Lease, as amended by the First Amendment, to
expand the Premises to include “Suite 320”, which contains approximately 1,717 square feet,
causing the Premises to be approximately 4,656 rentable square feet. The Original Lease, as amended by
the First Amendment and Second Amendment, is hereby referred to as the “Lease
”.

     D. Landlord and Tenant have agreed to modify the Lease to extend the term of the Lease and
expand the Premises to include “Suite 350”, which contains approximately 2,648 rentable
square feet and
to provide for the terms and conditions of leasing the additional square footage as set forth
in this
Amendment.

OPERATIVE PROVISIONS

     NOW, THEREFORE, for Ten Dollars ($10.00) and other valuable consideration including the
mutual covenants set forth herein, the receipt and sufficiency of which consideration are hereby
acknowledged, Landlord and Tenant hereby agree as follows:

     1. Defined Terms. All initial capitalized terms in this Amendment not defined in this
Amendment shall have the meanings assigned to such terms in the Lease.

     2. Expansion Premises. Effective on November 1, 2009 (the “Expansion Commencement
Date”), the Premises shall consist of 7,304 square feet of Rentable Area in the Building (the
“Premises”). The additional 2,648 square feet, known as “Suite 350”, that is being added to the
Premises pursuant to this Amendment is depicted on Exhibit A and shall be referred to as
the “Expansion Premises”. Tenant hereby accepts the Expansion Premises “as is” and acknowledges
that Landlord shall have no obligation to make any improvements, modifications or additions to the
Expansion Premises. Tenant acknowledges that neither Landlord nor any agent of Landlord has made
any representation or warranty with respect to the Expansion Premises or with respect to the
suitability or fitness for the conduct of Tenant’s business or for any other purpose. Occupancy of
the Expansion Premises by Tenant prior to the Expansion Commencement Date shall be subject to
Landlord’s reasonable rules, regulations and moving procedures, as well as all of the provisions of
the Lease excepting only those requiring the payment of Base Annual Rental and Electricity Costs
associated with the Expansion Premises.

     3. Term. The Term is hereby extended to end on June 30, 2010.

 

 

     4. Base Annual Rent. The Base Annual Rental, commencing on the Effective Date of
this Amendment and continuing on the first day of each and every month thereafter for the next
succeeding months during the balance of the Term, is hereby amended to be the following:

	 	 	 
	Date	 	Monthly Installment of Base Annual Rental
	November 1, 2009 — February 28, 2010
	 	**$ 12,001.63 (plus Electricity Costs)
	March 1, 2010 — June 30, 2010
	 	     $ 12,630.19 (plus Electricity Costs)

 

			
	**	 	Tenant’s Pro-Rata Share of Electricity Costs (as described in Section 4 below) from the
period between November 1, 2009 and February 28, 2010 shall only be assessed against the
Expansion Premises. It is the intent of Landlord and Tenant that 4,656 rentable square feet of
the Premises shall continue to be “full service” until February 28, 2010, whereupon on March 1,
2010, the entire 7,304 rentable square feet of the Premises will be assessed for the purpose of
determining Tenant’s Pro-Rata Share of Electricity Costs.

     5. Electricity Costs. In addition to Tenant’s payment of Tenant’s Pro-Rata Share of
Operating Costs, Tenant shall pay, on a monthly basis, Landlord’s estimate of Tenant’s Pro-Rata
Share of Electricity Costs (as defined below) for each calendar year or partial calendar year.
Tenant’s Pro-Rata Share of Electricity Costs shall, from time to time, be subject to change,
adjustment and annual reconciliation as Tenant’s Pro-Rata Share of Operating Costs; however,
Tenant’s Pro-Rata Share of Electricity Costs shall not be subject to any cap or limitation as may
otherwise be set forth in the Lease. Electricity Costs will be computed as though the Building
had been completely occupied for the entire calendar year. “Electricity Costs” means all costs
charged to or incurred by Landlord for electricity for the Building, including all costs of
metering the Building’s use of electricity and all indirect costs of providing electricity, such
as, but not limited to, any sales, use or other taxes and assessments. The term “Operating Costs”
is hereby amended to exclude Electricity Costs.

     6. Parking. Under the Lease, Tenant shall have the right to use a total of
twenty-two (22) unassigned parking spaces, at no additional cost to Tenant, in that certain
parking structure constructed under the Building.

     7. Effect of Amendment. The provisions of this Amendment will control over all
inconsistent provisions of the Lease. Tenant has no further rights to any leasehold improvements
or refurbishment allowances specified in the Lease.

     8. Ratification of Lease. Except as amended hereby, the terms and provisions of the
Lease shall remain unchanged and shall remain in full force and effect. The Lease as modified by
this Amendment is hereby ratified and confirmed in all respects.

     9. Entire Agreement. This Amendment and the Lease contain all of the agreements of
the parties hereto with respect to the subject matter thereof, and no prior agreement,
understanding or representation pertaining to any such matter shall be effective for any purpose.
The terms and conditions of the Lease and this Amendment may not be amended or otherwise affected
except by instrument in writing executed by each party to be bound thereby.

     10. Counterparts. This Amendment may be executed in any number of counterparts with
the same effect as if all parties hereto had signed the same document. All such counterparts
shall be construed together and shall constitute one instrument, but in making proof hereof it
shall only be necessary to

 

 

produce one such counterpart. The signature pages of various counterparts may be combined
onto one document.

     11. Brokers. Landlord and Tenant each represents to the other that it has had
no dealings with any broker or agent in connection with the negotiation of this Amendment
except PM Realty Group, as Landlord’s agent, and Cresa Partners, as Tenant’s agent, the
fees of which shall be paid by Landlord by separate agreement. Landlord and Tenant each
hereby agrees to defend, indemnify and hold harmless the other from and against any other
claims for brokerage, commission, finders or other fees relative to this Amendment, other
than Landlord’s agent and Tenant’s agent referenced above, resulting or arising out of any
acts or agreements of the indemnifying party.

     12. Representations of Tenant and Person Signing for Tenant. Tenant and the
person signing this Amendment on behalf of Tenant represents to Landlord as follows: (a)
Tenant is a limited liability company duly organized and legally existing under the laws of
the State of Delaware; (b) the execution and delivery of, and performance under, this
Amendment are within Tenant’s power and authority without the joinder or consent of any
party and have been duly authorized by all requisite action and are not in contravention of
law or the powers of Tenant’s partnership agreement; (c) the person signing this Amendment
on behalf of Tenant was and continues to be authorized to do so without the joinder of any
other person; and (d) this Amendment constitutes the legal, valid and binding obligations
of Tenant enforceable in accordance with its terms, subject to bankruptcy, insolvency,
reorganization and other laws affecting creditor’s rights generally, and with regard to
equitable remedies, to the discretion of the court before which proceedings to obtain same
may be pending.

This Amendment is effective as of the date first set forth above.

	 	 	 	 	 	 	 
	 	 	LANDLORD: Turtle Creek Limon, LP	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	3400 Carlisle Interests, LLC,	 	 
	 

	 	 	 	a Delaware limited liability company,	 	 
	 

	 	 	 	its General Partner	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Frank Mackey, VP
 

Frank Mackey, Vice President
	 	 
	 

	 	 	 	Date of Signature: Oct 23, 2009	 	 
	 
	 	 	 	 	 	 
	 	 	TENANT: Archipelago Learning, LLC	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ James B. Walburg
 

James B. Walburg
	 	 
	 

	 	Title:
	 	EVP & CFO	 	 
	 	 	Date of Signature: 10/23/2009	 	 

 

 

EXHIBIT “A”

TO

THIRD AMENDMENT TO OFFICE LEASE

	
3400 CARLISLE
Suite350/2,684 RSF
3400 Carlisle St.
Dallas, Texas

For Information, Contact:
Travis Ewert, Nathan Durham,
or Lauren Bentley
(972) 680-0106exv10w1

	 	 	 	 	 

Exhibit 10.1

FORM OF CONVERTIBLE NOTE

THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY APPLICABLE
STATE SECURITIES LAWS AND, ACCORDINGLY, MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF IN
THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT UNDER SAID ACT OR LAWS OR PURSUANT TO AN
EXEMPTION THEREFROM.

AXCESS INTERNATIONAL, INC.

Convertible Note

			
	 	 	 
	Up to $3,000,000
	 	October ___, 2009

Subject to the terms and conditions of this Note, for good and valuable consideration received,
Axcess International, Inc. (“Axcess”) hereby promises to pay to the order of the                                         
                     (“Investor”) the principal amount of                                          Dollars
($___), plus simple interest, accrued on unpaid principal from October ___, 2009, until paid,
at the rate of Five percent (5.00%) per annum (365-day year basis) payable on December 31, 2014
(the “Maturity Date”), in addition Axcess will issue to Investor a warrant to purchase ___
common shares with a strike price of $0.75 and expire December 31, 2014. If Axcess completes an
equity offering of any of its securities and the aggregate proceeds to Axcess are at least
$1,000,000 (“Transaction”), then the Note will automatically convert to common shares at $0.50.

Upon the occurrence of the Transaction described above, the principal amount and all unpaid
interest, of this Note shall convert to Common Stock. This Note, including the principal amount
and all accrued and unpaid interest hereunder, may otherwise be prepaid in whole or in part at any
time at the option of Axcess, without premium or penalty.

Payment of the principal amount of this Note and any accrued and unpaid interest hereunder shall be
made in such coin or currency of the United States of America as at the time of payment shall be
legal tender for the payment of public and private debts. Any such payment shall be paid by wire
transfer of federal funds in accordance with the written instructions of Investor or, in the
absence of current written instructions, by check mailed to Investor at the address last given to
Axcess by Investor in writing for such purpose.

This Note is not assignable except by operation of law; provided, however, that
Investor may assign all or part of the Note to its stockholders in connection with the partial or
complete liquidation of Investor.

If the Company fails to pay the principal amount of this Note when due, the entire unpaid principal
of this Note shall forthwith become absolutely due and payable without any further notice, demand,
protest or presentment whatsoever, all of which are hereby expressly waived. All expenses incurred
by Investor for the collection of the note will be paid for by Axcess.

This Note shall be governed by and construed in accordance with the laws of the Delaware, without
reference to its or any other jurisdiction’s rules as to conflicts of law. Any judicial proceeding
brought against Axcess to enforce, or otherwise in connection with, this Note shall be brought in
any court of competent jurisdiction in Delaware, and, by acceptance of this Note, Investor (a)
accepts, generally and unconditionally, the exclusive jurisdiction of such courts and any related
appellate court and irrevocably agrees to be bound by any final judgment rendered thereby in
connection with this Note and (b) irrevocably waives any objection it may now or hereafter have as
to the venue of any such proceeding brought in such a court or that such a court is an inconvenient
forum. The prevailing party shall be entitled to collect from the nonprevailing party all
reasonable attorneys fees incurred in connection with any action to enforce the terms of this Note.

Any provision of this Note may be amended or waived if, but only if, such amendment or waiver is in
writing, signed by Axcess and Investor.

IN WITNESS WHEREOF, Axcess has caused this Note to be signed by its duly authorized officer and has
caused its corporate seal to be affixed and attested by its Secretary, as of the date first set
forth above.

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