Exhibit 10.32
STATE OF NORTH CAROLINA
COUNTY OF ALAMANCE
AMENDMENT TO LEASE
     THIS AMENDMENT TO LEASE (“Amendment”) is made and effective as of the 1st day of August, 2004by and between Carolina Hosiery Mills, Inc., a North Carolina corporation trading as AlamanceIndustrial Park (“Landlord”) and TriPath Imaging, Inc., a Delaware corporation which changed itsname from AutoCyte, Inc. (“Tenant”);
WITNESSETH THAT:
     WHEREAS, Landlord and Tenant entered into that certain Lease Agreement dated July 28, 1997, asamended by letter agreement dated March 1, 1999 (collectively “the Lease”) relative to that certainbuilding and land located at 780-784 Plantation Drive, Burlington, North Carolina (“the Premises”);and
     WHEREAS, all capitalized terms defined in the Lease shall have the same meanings when usedherein as defined therein, with such amendments thereto as are expressly set forth hereinafter; and
     WHEREAS, Tenant desires to extend the term of the Lease and Tenant and Landlord have agreed tocertain amendments to the Lease as expressly set forth hereinafter;
     NOW, THEREFORE, for and in consideration of the premises and other good and valuableconsideration, the receipt and sufficiency of which is hereby mutually acknowledged, Landlord andTenant hereby agree and amend the Lease as follows:
     1. Extension of Term of Lease. The Initial Term of the Lease expires on August 20,2005. Landlord and Tenant do hereby covenant and agree to extend the Term of the Lease from August20, 2005 to and including December 31, 2018 (“Extension Term”). The foregoing Extension Term ofthe Lease shall be in lieu of and in replacement of the Renewal Term(s) set forth in Paragraph 2 ofthe Lease and therefore, the option to renew set forth in Paragraph 2 of the Lease is herebydeleted therefrom.
     2. Construction of Addition to the Premises. Landlord agrees to design and build atwenty- six thousand (26,000) square foot, plus or minus, addition to the Premises in accordancewith plans therefor prepared by Alley Williams Carmen King, Inc. and agreed upon by Landlord andTenant (“the Addition”). Landlord and Tenant agree to act in a commercially reasonable manner withrespect to the approval of such plans for the Addition. In addition, Landlord agrees to renovatethe existing Premises as specified by Tenant (“the Renovation”). Landlord shall complete theAddition and the Renovation in a good and workmanlike manner. Landlord shall be responsible forand shall pay for the costs and expenses of the Addition and the Renovation in an amount not toexceed Three Million Three Hundred Thousand Dollars ($3,300,000.00). All costs and expensesassociated with the Addition and the Renovation in excess of Three Million
 

 

Three Hundred ThousandDollars ($3,300,000.00) shall be the responsibility of Tenant and shall be paid by Tenant in cashor as Additional Rent as agreed upon by Landlord and Tenant. The Addition shall be deemed completeupon the issuance of a certificate of occupancy therefor by the City of Burlington. Landlord andTenant acknowledge that the projected completion date for the Addition is August 31, 2005 and theprojected completion date for the Renovation is December 31, 2005.
     3. Acknowledgement of Amount of Adjusted Base Rent. Landlord and Tenant do herebyacknowledge and agree that the Adjusted Base Rent under the Lease through the term thereof asextended herein is and shall be as follows:
          (a) For the period April 1, 2005 until the completion of the Addition and the Renovation, theAdjusted Base Rent shall be Three Hundred Nine Thousand Six Hundred Dollars ($309,600.00) perannum, payable in monthly installments of Twenty Five Thousand Eight Hundred Dollars ($25,800.00);
          (b) Upon the completion of the Addition and Renovation through December 31, 2010, the AdjustedBase Rent shall be Five Hundred Fifty Five Thousand Dollars ($555,000.00) per annum, payable inmonthly installments of Forty Six Thousand Two HundredFifty Dollars ($46,250.00). In the event the completion of the Addition and the Renovationoccurs on a date other than the first day of a month, the Adjusted Base Rent for the month of suchcompletion shall be paid at the rate set forth in (a) above until the date of completion and at therate set forth herein through the end of such month;
          (c) For the period January 1, 2011 through December 31, 2015, the Adjusted Base Rent shall beSix Hundred Thirty Eight Thousand Two Hundred Fifty Dollars ($638,250.00) per annum, payable inmonthly installments of Fifty Three Thousand One Hundred Eighty Eight Dollars ($53,188.00); and
          (d) For the period January 1, 2016 through December 31, 2018, the Adjusted Base Rent shall beSeven Hundred Thirty Three Thousand Nine Hundred Eighty Dollars ($733,980.00) per annum, payable inmonthly installments of Sixty One Thousand One Hundred Sixty Five Dollars ($61,165.00).
Such monthly installments of Adjusted Base Rent shall be paid in advance and shall be due on thefirst day of each month, but payable on or before the 10th day of each month through the expirationof the term as extended herein. By virtue of the foregoing agreed upon adjustments to the AdjustedBase Rent, the Additional Rent contemplated in Paragraph 4 of the Lease shall no longer beapplicable.
     4. Abatement of Adjusted Base Rent. In consideration for the extension of the term ofthe Lease herein, Landlord has agreed to an abatement of the Adjusted Base Rent in the total amountof Two Hundred Seventeen Thousand Nine Hundred Seven and 44/100 Dollars ($217,907.44) to be appliedas follows: (i) the Adjusted Base Rent due on August 1, 2004, September 1, 2004, October 1, 2004,November 1, 2004, December 1, 2004, January 1, 2005, February 1, 2005 and March 1, 2005 shall beabated in full.
 

 

     5. Tenant’s Option to Terminate Lease. Notwithstanding anything contained in theLease, as amended by this Amendment, to the contrary, Tenant shall have the right and option toterminate the Lease effective December 31, 2015 upon the terms and conditions expressly set forthhereinafter. Provided there are no uncured breaches or defaults under the Lease on the part ofTenant and all Adjusted Base Rent and other amounts due from Tenant through December 31, 2015 havebeen paid in full, upon at least twelve (12) months prior written notice from Tenant to Landlord,Tenant shall have the right and option to terminate the Lease effective December 31, 2015 upon thepayment by the Tenant to Landlord of a lump sum buyout amount of One Million Three Hundred SeventyFive Thousand Dollars ($1,375,000.00) (“the Lease Buyout Payment”). In the event (i) Tenantprovides Landlord with at least twelve (12) months prior written notice of Tenant’s election toexercise the Tenant’s right and option to terminate the Lease effective December 31, 2015, (ii)there are no uncured breaches or defaults under the Lease on the part of Tenant as of December 31,2015, (iii) all Adjusted Base Rent and other amounts due from Tenant through December 31, 2015 havebeen paid in full and (iv) the Lease Buyout Payment is received by Landlord on or before December31, 2015, then upon compliance by Tenant with the foregoing, the Lease shall terminate and lapseeffective December 31, 2015 and any and all obligations and liabilities thereunder shall lapse,cease and terminate, with the exception of any liability or obligation which survives terminationof the Lease pursuant to the express terms of the Lease relative thereto.
     6. Construction of Antibody Suite. Landlord and Tenant acknowledge that Tenant iscurrently converting a portion of the Premises and constructing an antibody suite. Tenant shallcomplete such conversion and construction in a good and workmanlike manner, free of any and allliens resulting therefrom. Landlord does hereby agree to reimburse Tenant for the costs of theconstruction of such antibody suite in an amount not to exceed Thirty Five Thousand Dollars($35,000.00). Any and all costs of the construction of such antibody suite in excess of ThirtyFive Thousand Dollars ($35,000.00) shall be the responsibility of Tenant and shall be promptly paidby Tenant.
     7. Effect of Amendment. Unless expressly modified or amended hereinbefore, theremainder of the Lease shall remain as expressly set forth therein during the term thereof asextended herein. The portions of the Lease not expressly modified or amended hereinbefore arehereby incorporated herein in full by reference and made a part of this Amendment by virtuethereof. The Lease may only be further amended by a written instrument executed by Landlord andTenant.
 

 

     IN WITNESS WHEREOF, Landlord and Tenant, by and through theft duly authorized officers, haveexecuted this Amendment under seal as of the day and year first above written.         Landlord:           Carolina Hosiery Mills, Inc.,    a North Carolina corporation    trading as Alamance Industrial Park          By:/s/ Maurice J. Koury (SEAL)      Name:  Maurice J. Koury   Title:President           Tenant:           TriPath Imaging, Inc.,    a Delaware corporation    which changed its name from    AutoCyte, Inc.          By:/s/ Stephen P. Hall (SEAL)      Name:  Stephen P. Hall   Title:SVP & CFO