Document:

exv10w1

 

PROMISSORY NOTE

			
	$5,000,000.00
	 	Minneapolis, Minnesota
	 
	 	November 3rd, 2006

1. FOR VALUE RECEIVED, HEI, Inc., a Minnesota corporation (the “Borrower”), hereby promises to pay
to the order of Thomas F. Leahy (the “Lender”), at such address as the Lender may designate from
time to time, the principal sum of Five Million and 00/100 DOLLARS ($5,000,000.00), in lawful money
of the United States and immediately available funds, together with interest on the unpaid balance
accruing as of the date hereof at a rate initially equal to fifteen percent (15%) per annum,
increasing by one percent (1.0%) per annum as of the first day of January, 2007 and the first day
of each calendar month thereafter (e.g. increasing to 16% per annum on January 1, 2007, to 17% per
annum on February 1, 2007, and so on); provided however, that in no event shall the applicable rate
hereunder exceed 20% per annum at any time (except to the extent due to application of the Default
Rate).

2. The outstanding principal balance hereof shall be payable in full on November 2nd,
2007 (the “Maturity Date”). Accrued interest on such principal balance shall be due and payable on
the first day of each calendar month, commencing with December 1, 2006, and shall be payable in
full on the Maturity Date.

3. The outstanding principal balance of this Note may be prepaid at any time at the option of the
Borrower without premium or penalty. Any payment(s) on this Note using the proceeds of any
insurance award or from a refinancing or from the sale of any collateral securing this Note
(whether such sale is made with or without the consent of the Lender), and any payment(s) made
after any event of default has occurred under this Note, and any other payment(s) on this Note from
any other source in excess of the principal payments scheduled pursuant to Paragraph 2 above, shall
be deemed a prepayment for purposes of this Paragraph 3 and Paragraph 5 below.

4. If any installment of principal or interest on this Note, including without limitation the
payment required on the Maturity Date, is not paid within fifteen (15) days of the due date
thereof, the Borrower shall pay to the Lender a late charge equal to five percent (5.0%) of the
amount of such installment.

5. All payments and prepayments shall, at the option of the Lender, be applied first to any costs
of collection, second to any late charges, third to accrued interest on this Note, and lastly to
principal (and, in the case of any prepayments, to installments of principal in the inverse order
of their maturity).

6. Notwithstanding anything to the contrary contained herein, if the rate of interest, late payment
fee, prepayment penalties or any other charges or fees due hereunder are determined by a court of
competent jurisdiction to be usurious, then said interest rate, fees and/or charges shall be
reduced to the maximum amount permissible under applicable Minnesota law.

7. Upon the occurrence of an Event of Default or at any time thereafter, at the option of the
Lender, the outstanding principal balance hereof shall bear interest at a rate equal to two percent
(2.0%) per annum in excess of the rate of interest otherwise applicable pursuant to Section 1
hereof (the “Default Rate”), in order to compensate the Lender for administrative expenses and
increased risk to the Lender associated with the occurrence of an Event of Default.

 

 

8. Upon the occurrence of an Event of Default or at any time thereafter, the outstanding principal
balance hereof and accrued interest and all other amounts due hereon shall, at the option of the
Lender, become immediately due and payable, without notice or demand.

9. Upon the occurrence of an Event of Default or anytime thereafter, the Lender shall have the
right to set off any and all amounts due hereunder by the Borrower to the Lender against any
indebtedness or obligation of the Lender to the Borrower.

10. Upon the occurrence at any time of an Event of Default or at any time thereafter, the Borrower
promises to pay all costs of collection of this Note, including but not limited to attorneys’ fees,
paid or incurred by the Lender on account of such collection, whether or not suit is filed with
respect thereto and whether such cost or expense is paid or incurred, or to be paid or incurred,
prior to or after the entry of judgment.

11. This Note is secured by the “Security Agreement” (as defined below) and is entitled to all of
the benefits provided for in said agreement.

12. As used herein, the term “Event of Default” shall mean (i) the Borrower’s failure to pay, as
and when due hereunder, any principal, interest or other amount payable pursuant to this Note,
and/or (ii) any breach of, default or event of default under that certain Security Agreement dated
of even date herewith, executed by the Borrower in favor the Lender, as amended from time to time
(the “Security Agreement”).

13. Demand, presentment, protest and notice of nonpayment and dishonor of this Note are hereby
waived.

14. This Note shall be governed by and construed in accordance with the laws of the State of
Minnesota.

15. Borrower hereby irrevocably submits to the jurisdiction of any Minnesota state court or federal
court over any action or proceeding arising out of or relating to this Note, the Security
Agreement, and any instrument, agreement or document related thereto, and Borrower hereby
irrevocably agrees that all claims in respect of such action or proceeding may be heard and
determined in such Minnesota state or federal court. Borrower hereby irrevocably waives, to the
fullest extent it may effectively do so, the defense of an inconvenient forum to the maintenance of
such action or proceeding. Borrower irrevocably consents to the service of copies of the summons
and complaint and any other process which may be served in any such action or proceeding by the
mailing by United States certified mail, return receipt requested, of copies of such process to
Borrower’s last known address. Borrower agrees that judgment final by appeal, or expiration of
time to appeal without an appeal being taken, in any such action or proceeding shall be conclusive
and may be enforced in any other jurisdictions by suit on the judgment or in

- 2 -

 

any other manner provided by law. Nothing in this Paragraph shall affect the right of Lender to
serve legal process in any other manner permitted by law or affect the right of Lender to bring any
action or proceeding against Borrower or its property in the courts of any other jurisdiction to
the extent permitted by law.

	 	 	 	 	 
	 	HEI, Inc.

 	 
	 	By     /s/ Mark B. Thomas
 	 
	 	Mark B. Thomas 	 
	 	Its: Chief Executive Officer and Chief
Financial
      Officer 	 
	 

[SIGNATURE PAGE TO PROMISSORY NOTE]

- 3 -<PAGE>

                                                                    Exhibit 10.1

                             AMENDMENT TWO TO LEASE

     THIS AMENDMENT TWO TO LEASE ("Amendment Two") is made as of the 1st day of
September, 2006, by and between University Research Park, Inc., a Wisconsin
non-stock corporation (hereinafter referred to as "URP" or "Landlord"), as
successor by merger to University Research Park Facilities Corp. (hereinafter
referred to as "URPFC") and Third Wave Technologies, Inc., a Delaware
corporation (hereinafter referred to as "Tenant").

                                    RECITALS

     A.   On September 1, 2001, URPFC entered into an Amended and Restated Lease
          Agreement (the "Lease Agreement") with Tenant for approximately 94,726
          square feet of space in a building located at 502 South Rosa Road,
          Madison, Wisconsin 53711 (the "Leased Premises").

     B.   Effective December 31, 2001, URPFC and URP merged, with URP as the
          surviving corporation and successor to all of URPFC's rights and
          obligations, including as Landlord under the Lease Agreement.

     C.   Effective September 1, 2001, Landlord and Tenant executed Amendment
          One to Lease ("Amendment One"), which modified some of Tenant's
          obligations.

     D.   Landlord and Tenant wish to modify certain provisions of the Lease
          Agreement.

     NOW, THEREFORE, in consideration of the foregoing, and other good and
valuable consideration, the receipt and sufficiency of which are acknowledged by
each party, the following amendments to the Lease Agreement are hereby agreed
to, effective September 1, 2006 (the "Effective Date").

1.   The second sentence of Section 1.2 of the Lease is deleted in its entirety
     and restated as follows:

     The term for the Existing Building as depicted on Exhibit B of the Lease
     Agreement shall end at midnight on September 30, 2011. The term for the New
     Building Addition as depicted on Exhibit B of the Lease Agreement shall end
     at midnight on September 30, 2014.

2.   Section 1.3 of the Lease is deleted in its entirety.

3.   The first and third paragraphs of Section 1.5 of the Lease Agreement, as
     amended by Amendment One, are deleted in their entirety and restated as
     follows:

     SECTION 1.5 SECURITY DEPOSIT. Tenant shall maintain with Landlord a
security deposit in the form of a cash (or equivalent) deposit or acceptable
letter of credit, in the amount of $1,000,000.00.
<PAGE>

This security shall secure all of the Tenant's obligations under this Lease
Agreement or arising in the event of the Tenant's default.

     The letter of credit shall be issued by a bank organized under the laws of
the U.S. or any state thereof, with capital and undivided surplus of no less
than $100,000,000.00 and a rating by Moody's of its unsecured debt securities of
no less than A, and shall have an initial term through August 31, 2007.

4.   Section 2.1 of the Lease Agreement is deleted in its entirety and restated
     as follows:

     SECTION 2.1 EASE RENT. Tenant shall pay to Landlord at its office in
Madison, Wisconsin, or such other place as Landlord may designate in writing,
and without any deduction or offset whatsoever, as base rent, the amounts on or
in advance of the first day of each calendar month as shown on the rent schedule
attached hereto as Exhibit C.

     The September 2006 Addition Improvement rent balance of $1,905,502 is
reduced to $1,000,000.00 and shall be paid in four equal installments of
$250,000.00 on the 1st day of January, April, July, and October, 2007, as
indicated on Exhibit C ("Improvement Installments"). The Improvement
Installments are in addition to all other rent due.

Exhibit C of the Lease Agreement, as restated by Amendment One, is deleted in
its entirety and restated as Exhibit C in the form attached hereto.

5.   Section 4.3 of the Lease Agreement is deleted in its entirety and restated
     as follows:

     SECTION 4.3 ASSIGNMENT OR SUBLETTING. Tenant agrees not to sell, assign,
mortgage, pledge or in any manner transfer this Lease or any estate or interest
thereunder and not to sublet the Leased Premises or any part or parts thereof
without the prior written consent of Landlord in each instance, which consent
shall not be unreasonably withheld. Consent by Landlord to one assignment of
this Lease or to one licensing or subletting of the Leased Premises shall not be
a waiver of Landlord's rights hereunder as to subsequent assignment or
subletting. Landlord's rights to assign this Lease are and shall remain
unqualified. For any assignment or sublease of 20,000 square feet or more in a
single or series of related transactions or at any time Tenant shall be in
default under this Lease, Landlord shall have the option to elect to enter into
a new lease, directly with the proposed assignee or subtenant, on the same terms
and conditions as the proposed sublease or assignment.

6.   Section 10.2 of the Lease Agreement is deleted in its entirety and restated
     as follows:

     SECTION 10.2 SALE OF LANDLORD'S INTEREST. Upon any sale, transfer or
conveyance, Landlord shall cease to be liable under any covenant, condition or
obligation imposed upon it by this Lease, or any of the terms and provisions
thereof, provided, however, that any such sale, transfer or conveyance shall be
subject to this Lease and that all of the Landlord's covenants and obligations
contained herein shall be binding upon the subsequent owner or owners thereof;
and provided further that such transferee from Landlord shall in writing assume
the obligations of Landlord hereunder.
<PAGE>

7.   This Amendment Two shall not be effective until Tenant establishes the
     security deposit provided for in section 1.5, as amended. If the security
     deposit is not established on or before September 1, 2006, this amendment
     shall be void and of no effect.

8.   All other terms and conditions of the Lease Agreement shall remain
     unchanged, and are hereby ratified and confirmed.

LANDLORD:                               UNIVERSITY RESEARCH PARK, INCORPORATED

                                        By: /s/ Mark D. Bugher
                                            ------------------------------------
                                            Mark D. Bugher, Assistant
                                            Secretary/Treasurer

                                        Date: September 5, 2006

TENANT:                                 THIRD WAVE TECHNOLOGIES, INC.

                                        By: /s/ Kevin T. Conroy
                                            ------------------------------------
                                        Printed Name: Kevin T. Conroy
                                        Its: President & Chief Executive Officer

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