Document:

Exhibit
10.24

 

COMMERCIAL LEASE

 

BETWEEN
THE UNDERSIGNED:

 

“BALUX”,
a French société civile with capital stock of
10,000.00 € having its registered office at 229 Chemin du Buttit - 38330 Saint
Ismier, France, recorded in the Commercial Register of Grenoble under No. 488
559 576.

 

Represented
by Alain Tornier in his capacity as manager,

 

Hereinafter
“THE LESSOR”,

 

THE PARTY OF THE FIRST PART

 

and
“TORNIER”, a société par actions simplifiée
with capital stock of 311,024 €, having its registered office at Rue Doyen
Gosse - 38330 Saint Ismier, recorded in the Commercial Register of Grenoble
under No. 070.501.275, represented by Douglas Kohrs, Chairman and CEO,

 

Hereinafter
“THE LESSEE”,

 

THE PARTY OF THE SECOND PART

 

The
parties agree as follows:

 

RECITALS

 

On
May 22, 2006, SCI BALUX signed a bilateral preliminary and conditional
commercial lease with TORNIER SAS relating to a building to be constructed
consisting of three stories of 790 m2 each with an
elevator, consisting of a ground floor to be used as a clean room and primary
and secondary packaging room, two floors for use as offices and tertiary
activities and located on a parcel of land in Montbonnot Saint Martin - Zirst -
161 rue Lavoisier.

 

The
lessee paid a pre-rental fee which was determined as follows:

 

·                                          At the monthly sum of
fifteen thousand euros (15,000 €) net of taxes, for the period from July 1,
2006, through December 31, 2006,

 

·                                          At the monthly sum of twenty
thousand euros (20,000 €) net of taxes for the period from January 1, 2007, and
the delivery date of the real estate.

 

The
pre-rental fee was payable quarterly and in advance. The first pre-rental fee
was due July 1, 2006, plus the VAT at the rate in force.

 

Since
the acceptance report signed on September 7, 2007, the lessee has been paying
an annual rent, net of taxes, of four hundred eighty thousand euros (480,000
€). By explicit agreement, the above rent is reduced quarterly by the sum of
fifteen thousand euros (15,000 €) net of taxes, by application of a portion of
the pre-rental fees paid, until the pre-rental fees have been fully amortized.

 

1

 

The
rent is payable quarterly and in advance, in equal installments of one hundred
twenty thousand euros (120,000 €) net of taxes, to the lessor’s registered
office or to the offices of the person or entity managing the premises in the
lessor’s place, for the first time when the premises are delivered and on the
first day of every calendar quarter thereafter.

 

The
final acceptance report having been signed on February 5, 2008, the parties
have agreed to enter into a commercial lease agreement which is effective
retroactive to May 22, 2006.

 

AGREEMENT

 

Consequently,
the “lessor” leases, subject to the terms and conditions set forth below, to
the “Lessee”, which accepts, the property described below:

 

1/            DESCRIPTION

 

The
premises are located in Montbonnot Saint-Martin (38330) Zirst, at 161 rue
Lavoisier, a building composed of three stories of 780 m2 each, with elevator, consisting of:

 

A
ground floor for use as a clean room and for primary and secondary packaging.

 

Two
floors for use as offices and tertiary activities.

 

It
is stipulated that with the explicit agreement of the “lessee”, the “lessor”
reserves for itself the use and enjoyment of Office No. 205 located on the 2nd
floor, or any other equivalent office which shall remain assigned to it for the
term of the lease, for the use of its legal representative for the management
of the leased building.

 

Any
error in the above description may not be invoked as grounds for a reduction or
increase of the rent, and the parties represent and warrant that they are
completely familiar with the size, location and characteristics of the future
properties.

 

2/            TERM - ENTRY INTO FORCE

 

This
lease is granted and accepted for a period of nine full and consecutive years,
is in force retroactive to May 22, 2006, and expires May 22, 2015.

 

Pursuant
to the provisions of Article L. 145-4 of the Commercial Code, the Lessee shall
have the option of cancelling the lease at the expiration of each three-year
period; the Lessor shall have the same option if it intends to invoke the
provisions of Articles L. 145-18, L. 145-12 and L. 145-24 of the Commercial
Code to rebuild the existing structure, to add floors to the building or to carry
out work specified or authorized in the context of a real estate restoration
operation.

 

3/            INTENDED OCCUPATION AND USE

 

Subject
to the provisions of Article 19 below, the Lessee itself must peacefully occupy
the leased premises in accordance with the requirements of the Civil Code and
for the needs of the administrative and technical operations (including but not
limited to packaging and storage) inherent to the activity of the manufacture
and sale of surgical instruments and products, to the exclusion of any other
utilization.

 

2

 

The
lessee may not modify this intended use on any pretext, even temporarily, nor
may it change the nature of the activity conducted on the premises.

 

The
lessee may, however, add associated or complementary activities, although on
the explicit condition that it makes its intentions known to the lessor and
asks it for the authorization via extrajudicial process pursuant to Articles L.
145-47 ff. of the Commercial Code.

 

4/            CONDITION OF THE LEASED PREMISES

 

The
lessee accepts the premises in their current condition as of the date of this
agreement.

 

5/            MAINTENANCE

 

To
the exclusion of the repairs stipulated in Article 606 of the Civil Code, which
remain the responsibility of the lessor, the lessee shall maintain the leased
premises in good condition and is responsible for minor repairs necessitated by
its tenancy.

 

The
lessee shall maintain all the installations for its own personal use, including
but not limited to heating, air conditioning, fire extinguishers, electrical
installations, lines and conduits for water, natural gas, electricity,
telephone and miscellaneous fluids, as well as the latches and locks of the
windows, doors and shutters, metal shutters, plate glass, window panes, floors,
tiling, floor coverings, paneling, ceilings etc.

 

The
lessee shall be liable for accidents caused by and to these items.

 

The
lessee must take all precautions to prevent damage caused by ice or freezing.

 

The
lessee shall also be liable for all repairs that are normally the
responsibility of the lessor, but which may be required either because of the
failure of the lessee to perform repairs for which it is responsible as cited
above, or as a result of wear or damage caused by the lessee, its employees or
its visitors, either in the leased premises or in other parts of the building.

 

6/            REPAIRS AND CONSTRUCTION IN THE
BUILDING

 

The
lessee must permit, regardless of the any annoyances experienced by it, all
repairs, reconstructions, addition of floors and any other construction work
that may be performed in the building and may not request any indemnity or
reduction of the rent, regardless of the scope and duration of the work, and
waiving the provisions of Article 1724 of the Civil Code, even when the work
lasts for a period longer than forty days.

 

The
lessee must immediately inform the lessor of any repair for which the latter is
responsible and the lessee finds is necessary. The lessee may be liable for any
consequences resulting from its failure or delay in notifying the lessor of the
need for such repairs.

 

The
lessee must remove, at its own expense and without delay, all falsework and
decorations, as well as all installations it may have constructed and the
removal of which is necessary for the identification and repair of leaks of all
types, cracks in the exhaust or ventilation ducts, including but not limited to
after fires or seepage and in general for the execution of all construction
work.

 

3

 

The
lessee must remove at its own expense and without delay, during the resurfacing
of outside walls, all fixtures, signage etc., the removal of which may be
necessary for the execution of the work.

 

7/            TRANSFORMATIONS AND IMPROVEMENTS
BY THE LESSEE

 

The
lessee may not perform any demolition, construction or any change of layout,
partitioning, make any openings in the walls or install any panel or sign on
the facades or anywhere else in the leased premises without prior written
permission from the lessor. If the work is authorized, the work must be
performed under the supervision of the lessor’s architect, whose fees shall be
paid by the lessee.

 

Upon
the expiration of this lease, all decorations, improvements and constructions
installed by the lessee in the leased premises shall remain the property of the
lessor without any compensation paid to the lessee.

 

8/            FURNISHING AND OBLIGATION TO USE

 

The
lessee must keep the leased premises in continuous use. The lessee must also
furnish the premises and keep them continuously stocked at all times with
equipment, merchandise and furniture of sufficient value to cover the payment
of the rent and the miscellaneous payments or reimbursements that are
associated with the use of the premises.

 

9/            INSURANCE

 

The
lessee must insure with a solvent insurance company and keep covered for the
entire term of the lease all equipment, furniture, merchandise and
miscellaneous items used to furnish the leased premises, as well as all the
installations and fixtures, in particular against fire, explosions, water
damage and natural disasters.

 

The
coverage must include, among other things, electrical damage, breakage of
computer and office equipment, glass breakage, tangible and intangible damage
resulting from theft or attempted theft, costs of removal and replacement,
removal of debris and demolition, including transport of the rubble, expert’s
fees and indirect losses.

 

The
lessee must also obtain coverage for claims by neighbors and third parties.

 

The
lessee must also purchase insurance covering the pecuniary consequences of its
civil liability, and bodily injury or property damage that may be caused to
third parties, not only as a result of its tenancy and the use of the fixtures
and installations, but also damage and injury caused by its employees and
vicarious agents.

 

The
policy must also provide coverage of the pecuniary consequences of the lessor’s
civil liability on account of any damage that may be caused to third parties by
the buildings, land, walls and fences.

 

The
lessor and its insurors waive all recourse against the lessee, this waiver of
recourse being reciprocal, whereby the lessee and its insurors also waive all
recourse against the lessor.

 

In
response to a first request from the lessor or its representative, the lessee
must provide documentary evidence of the subscription of said insurance
policies and the payment of the corresponding premiums.

 

4

 

10/          PREVENTION OF NATURAL AND
TECHNOLOGICAL RISKS

 

The
lessee acknowledges, pursuant to the provisions of Article L. 125-5 of the
Environmental Code, that it has been informed of the status of the leased
premises with regard to natural and technological risks, and that it is aware
of the status of the natural and technological risks. The lessee also
acknowledges receipt of the summary report prepared by the Prefecture of Isère,
as well as the status of the risks, as these documents are annexed to this
Agreement.

 

11/          TAXES AND ASSESSMENTS

 

Independently
of the reimbursements it may be required to make to the lessor, the lessee must
pay all taxes, contributions or assessments for which it is responsible and for
which the lessor may be held liable for any reason whatever, and must prove the
payment of the amounts in question in response to any request from the lessor,
in particular upon the expiration of the lease, before vacating the premises.

 

The
parties explicitly agree that the lessee shall reimburse the lessor for its
percentage of the real-estate tax on the improved property.

 

This
participation shall be payable, at the option of the lessor, either at the end
of the period, upon receipt of the tax assessment, or in installments,
quarterly and in advance, at the same time as the rent for the premises
currently leased, with a settlement at the end of the period, as soon as the
lessor has been informed of the exact amount of said tax.

 

12/          COMPLIANCE WITH GOVERNMENT AND
OTHER REQUIREMENTS

 

The
lessee must obey the requirements, regulations and orders in force, including
but not limited to those related to road maintenance, cleanliness, the police,
the labor inspection office and compliance of the premises with general health
and safety standards, so that the lessor is protected and held harmless from
any and all claims, and the lessee must be responsible for all resulting
repairs and construction work.

 

If,
now or in the future, there are formal regulations governing the use and
enjoyment of the property or condominium rules for the building, the lessee
must obey all such rules and regulations. The lessee must also comply with any
decision duly adopted by the meeting of the co-owners.

 

13/          CLAIMS FROM OR AGAINST THIRD
PARTIES

 

The
lessee must assume personal responsibility, at its own risk, peril and expense
for any claims made by the other occupants of the building, the neighbors or
third parties, including but not limited to noise, odors, heat or trepidations,
caused by it or by equipment belonging to it, whereby the lessor must be
protected and held harmless from any such claims.

 

Nevertheless,
if the lessor is required to pay any sums as a result of the lessee’s actions,
the lessee shall be required to reimburse the lessor without delay.

 

The
lessee must assume personal responsibility for all damage caused to the leased
premises and all interference with enjoyment caused by the other occupants of
the building, neighbors or third parties and must take action directly against
the parties responsible for the interference, whereby the lessor must be
protected and held harmless.

 

5

 

14/          SECURITY

 

The
lessee shall be personally responsible for the security and surveillance of its
premises. The lessor may not in any case or for any reason be held liable for
thefts or misappropriation of which the lessee may be the victim in the leased
premises.

 

15/          DESTRUCTION OF THE LEASED PREMISES

 

If
the premises are totally destroyed by an event which is beyond the lessor’s
control, this lease shall be cancelled ipso jure
without payment of any indemnity.

 

In
the event of a partial destruction of the premises, this lease may be cancelled
without indemnity at the request of either party, notwithstanding the
provisions of Article 1722 of the Civil Code, but without prejudice, for the
lessor, to its potential recourse against the lessee if the destruction was the
fault of the latter.

 

16/          INTERRUPTION IN PUBLIC UTILITIES

 

The
lessor may not be held liable for irregularities or interruptions in the supply
of water, natural gas, electricity or any other analogous public utilities
outside the building, nor is the lessor required to give the lessee advance
notice of interruptions.

 

17/          RETURN OF THE PREMISES

 

On
the occasion of the expiration of the lease, the lessee must notify the lessor
one month in advance of the date on which it plans to vacate the premises so
that the lessor can submit the required information to the tax authorities.

 

The
lessee must return the keys on the day it vacates the premises, even if that is
before the expiration of the current term of the lease.

 

18/          AMENDMENT - WAIVERS - SEVERABILITY

 

This
agreement may only be amended by an explicit written document in the form of a
bilateral agreement or an exchange of letters.

 

An
amendment of this type may not in any case be deemed to have been made as a
result of a lack of action on the part of either party or a simple failure of
any frequency and duration to enforce its rights. The lessor and the lessee are
free at any time to demand the strict enforcement of the clauses and
stipulations that have not been the subject of an explicit or written
amendment.

 

The
lease is held to be indivisible for the sole benefit of the lessor, in
particular in the case of any sub-lease that may be authorized. In the case of
co-lessees as the result of any change of ownership, the obligation of the
co-lessees shall be deemed joint and indivisible.

 

19/          ASSIGNMENT - SUB-LEASING

 

The
lessee may not:

 

·              allow the enjoyment of the leased
premises to any party whatever in any form whatever, even temporarily, for free
or for a short period, or sub-lease the premises in whole or in part,

 

6

 

except
for the benefit of any company having its registered office in France which is
the parent company or subsidiary of the lessee, or for the benefit of any
company having its registered office in France that controls the lessee or is
controlled by the lessee within the meaning of Article L. 233-3-I of the
Commercial Code.

 

·                                          assign its right to this
lease, except in totality to its business successor, in which case it must
obtain permission for said assignment from the lessor and not simply notify it
of the transfer of the lease, and must give the lessor an execution copy or a
copy of the assignment document which shall serve as title with respect to the
assignee.

 

The
lessee shall remain the guarantor, jointly and severally with its assignee and
all successive assignees, as well as with its sub-lessee or sub-lessees, for
payment of the rent and charges, current and future, and for compliance with
the conditions of this lease.

 

The
lessee may not transfer or assign the lease if any rent or charges are due.

 

20/          RENT

 

This
lease is granted and accepted in exchange for an annual rent, net of taxes of four hundred eighty thousand euros (480,000 €) counting from
the completion of the construction. The acceptance report shall represent the
beginning of the rental period strictly speaking.

 

By
explicit agreement, the rent stipulated above shall be reduced quarterly by the
amount of fifteen thousand euros (15,000 €) net of taxes, by crediting a
portion of the pre-rental fees paid, until the full amount of the pre-rental
fees is amortized.

 

This
rent will be subject to the value-added tax at the rate in force.

 

The
lessee shall reimburse the lessor for the amount of the tax assessed on the
rent and charges on the occasion of the payment of each installment of the
rent.

 

The
rent shall be payable quarterly and in advance in equal installments of one hundred twenty thousand euros (120,000 €) net of taxes,
at the lessor’s registered office or at the offices of the person or company
managing the leased premises in the lessor’s place, for the first time upon
delivery of the premises and on the first day of each calendar quarter
thereafter.

 

Miscellaneous
charges and services shall be reimbursed under the conditions described in
greater detail in the article entitled “Charges” below.

 

The
rent for the premises described above is subject to variations in proportion to
the index of the cost of construction published quarterly by the I.N.S.E.E.

 

This
article constitutes a conventional indexing clause and does not refer to the
triennial revision permitted by law pursuant to Articles 26 and 27 of the
Decree dated September 30, 1953, which shall be applied ipso jure.

 

The
rent shall be adjusted on the basis of this clause every 3 years counting from
the date of entry into force of the lease. The rent shall vary by the same
percentage as the selected index. The indexing shall enter into force
automatically without the requirement for prior notification.

 

If
the selected index is no longer published or can no longer be applied for any
reason whatever, it shall be replaced by the closest index, which shall be
identified, in case of doubt, by an expert acting for both parties, appointed
by agreement between them or, if no agreement can be

 

7

 

reached,
by an order of the President of the court in response to a petition from the
more diligent party. If the expert declines to accept the assignment, resigns
or is unable to perform the task for any reason whatever, a replacement shall
be appointed in the same manner.

 

21/          CHARGES

 

The
lessee shall pay, either by direct payment to the supplier or by reimbursement
to the lessor, its proportional share of the costs of maintenance, services and
all other building charges, plus the VAT, where applicable.

 

The
lessee shall pay all the expenses for the supply of water, natural gas, fuel,
telephone, security etc. directly.

 

The
reimbursement to the lessor of all these charges or expenses shall be made at
the same time as the payment of each installment of the rent in the form of
provisional installment payments, with a final settlement once a year.

 

22/          CANCELLATION

 

If
payment in full of even a single installment of the rent or reimbursement of
expenses, charges or services that represent accessory costs is not received
when due, or in the event of a default of any of the conditions of this lease,
and one month after a simple demand for payment or an official demand for
payment from a bailiff has gone unheeded, containing a statement by the lessor
of its intention to invoke this clause, this lease shall be cancelled ipso jure
if the lessor considers it appropriate, without the need to bring formal
proceedings

 

If
the lessee refuses to vacate the premises, it may be evicted without delay by a
simple interim order issued by the President of the Regional Court of Grenoble
and immediately enforceable, notwithstanding any appeal.

 

23/          SECURITY DEPOSIT

 

The
lessor shall receive from the lessee the sum of seventy-eight
thousand nine hundred sixty-six euros (78,966 euros) corresponding
to three (3) months of rent, in payment of the rent and to guarantee the proper
performance of the terms and conditions of this lease, repairs resulting from
the tenancy and all amounts owed by the lessee for which the lessor could be held
liable.

 

23/          COSTS

 

The
lessee shall pay all the costs relating to this agreement and its successors.

 

24/          ADDRESS OF SERVICE

 

For
the performance of this agreement and its successors, the parties elect address
of service at the location of their respective registered offices.

 

8

 

Executed
in Montbonnot in two originals

on
February 6, 2008

 

	
  for
  SCI BALUX

  	
   

  	
  for
  SAS “TORNIER”

  
	
  Alain
  Tornier

  	
   

  	
  Douglas
  Kohrs

  
	
   

  	
   

  	
   

  
	
  /s/
  Alain Tornier

  	
   

  	
  /s/
  Douglas Kohrs

  

 

9Exhibit
10.25

 

AMENDMENT TO COMMERCIAL LEASE NO. 1

 

BETWEEN
THE UNDERSIGNED:

 

SCI
CYMAISE, a company with capital stock of 2,286.74 € having its registered
office at Chemin Doyen Gosse, 38330 Saint Ismier, France, recorded in the
Commercial Register of Grenoble under No. 339 711 079.

 

Represented
by Alain Tornier in his capacity as manager,

 

Hereinafter
“THE LESSOR”,

 

THE PARTY OF THE FIRST PART

 

and
“TORNIER”, a société par actions simplifiée
with capital stock of 311,024 €, having its registered office at Rue Doyen
Gosse - 38330 Saint Ismier, recorded in the Commercial Register of Grenoble
under No. 070.501.275, represented by Douglas Kohrs, Chairman and CEO,

 

Hereinafter
“THE LESSEE”,

 

THE PARTY OF THE SECOND PART

 

The
parties agree as follows:

 

RECITALS

 

The
Lessee hereby gives the Lessor notification of the following changes in the
legal organization of the TORNIER Group during the 2007 fiscal year:

 

Under
the terms of a decision by the single shareholder dated July 31, 2007, TORNIER
HOLDING SAS was absorbed in the form of a merger by TORNIER SAS, a transaction
that included the transfer of all of its assets, rights and obligations.
TORNIER SAS is therefore subrogated by law in the lease dated May 30, 2006,
entered into between SCI CYMAISE and TORNIER HOLDING SAS. The lease in question
relates to premises of 117 m2 used as offices in addition to a
parking area of 8 m2 located in Saint Ismier in exchange for an
annual rent, net of taxes, of 13,269 €, with a security deposit of 3,317 €,
corresponding to 3 months rent, to guarantee payment of the rent.

 

Under
the terms of a decision by the single shareholder dated December 29, 2007,
TORNIER MEDI-QUAL Sarl and TORNIER BIOTECHNIC Sarl were dissolved and all of
their assets and liabilities were transferred to TORNIER SAS, which has its
registered office in Saint Ismier (38330), Rue Doyen Gosse, and is a société par actions simplifiée recorded in the Commercial
Register maintained by the Tribunal of Commerce of Grenoble under No. 070 501
275. TORNIER SAS therefore assumes responsibility for the leases of the two
above-mentioned companies with SCI CYMAISE described as follows:

 

1
- a lease with TORNIER MEDI-QUAL Sarl for the premises located in St. Ismier
with an area of 58 m2 used as offices plus a parking area of 4 m2 for an annual rent, net of taxes, of 6,578 €,
with a security deposit of 1,645 €, corresponding to 3 months rent, to
guarantee payment of the rent.

 

1

 

2
- lease with TORNIER BIOTECHNIC Sarl for the premises located in St. Ismier
used as follows:

 

                · offices 1290 m2

                · equipment or storage 240 m2

                · workshop 148 m2

                · lunchroom 75 m2

 

plus
a parking area of 4 m2, in exchange
for an annual rent, net of taxes, of 169,289 € with a security deposit of
42,322 €, corresponding to 3 months rent, as a guarantee of payment of the
rent.

 

Consequently,
for reasons of administrative simplification, the lessee would like to transfer
from TORNER COMMERCIAL to TORNIER SAS the commercial lease executed on May 30,
2006, covering the premises located in St. Ismier of 48 m2 used as office space plus a parking area of 3
m3 for an annual rent, net of taxes, of 5,440 €,
with a security deposit in the amount of 1,360 €, corresponding to 3 months
rent. The parties have agreed to transfer the lease to TORNIER SAS pursuant to
Article 12 of the above referenced lease.

 

Under
the terms of the lease dated May 30, 2006, the lessor leased to the lessee a
building located in St. Ismier for the uses listed below:

 

                · offices 165 m3

                · equipment or storage 791 m2

                · production 1031 m2

                · lunchroom 125 m2

 

plus
a parking area of 18 m2 in exchange for an annual rent, net of taxes,
of 121,289 €, with a security deposit of 30,322 € to guarantee payment of the
rent.

 

The
purpose of this supplemental agreement is to modify the description of the
leased areas, which have been increased from the areas indicated in the
commercial leases signed on May 30, 2006, by the Lessor and the Lessee with,
respectively, TORNIER HOLDING SAS, TORNIER MEDI-QUAL Sarl, TORNIER BIOTECHNIC
Sarl and TORNIER COMMERCIAL Sarl.

 

The
total of the annual rents paid by TORNIER HOLDING SAS, TORNIER MEDI-QUAL Sarl,
TORNIER BIOTECHNIC Sarl and TORNIER COMMERCIAL Sarl are currently assumed by
TORNIER SAS in an unchanged total amount.

 

AGREEMENT

 

The
“Lessor” having agreed to the subrogation of TORNIER SAS in the rights and
obligations of the leases described in the “Recitals” section of this
Agreement, the parties have agreed that their new relationship shall be
governed by this Supplemental Agreement.

 

Consequently,
the “lessor” leases, subject to the terms and conditions set forth below, to
the “Lessee”, which accepts, the property described below:

 

1/            DESCRIPTION

 

The
premises are located on Rue Doyen Gosse in St. Ismier (38330), comprising a
total surface area of 4,125 m2, broken down as follows:

 

·              office space 1678 m2

·              equipment or storage 1031 m2

·              workshop 1179 m2

 

2

 

·              lunchroom 200 m2

 

plus
a parking area of 37 m2

 

Any
error in the above description may not be invoked as grounds for a reduction or
increase of the rent, and the parties represent and warrant that they are
completely familiar with the size, location and characteristics of the future
properties.

 

2/            TERM - ENTRY INTO FORCE

 

This
lease is granted and accepted for a period of nine full and consecutive years,
is in force retroactive to May 30, 2006, and expires May 30, 2015.

 

Pursuant
to the provisions of Article L. 145-4 of the Commercial Code, the Lessee shall
have the option of cancelling the lease at the expiration of each three-year
period; the Lessor shall have the same option if it intends to invoke the
provisions of Articles L. 145-18, L. 145-12 and L. 145-24 of the Commercial
Code to rebuild the existing structure, to add floors to the building or to
carry out work specified or authorized in the context of a real estate
restoration operation.

 

3/            INTENDED OCCUPATION AND USE

 

Subject
to the provisions of Article 19 below, the Lessee itself must peacefully occupy
the leased premises in accordance with the requirements of the Civil Code and
for the needs of the administrative and technical operations (including but not
limited to packaging and storage) inherent to the activity of the manufacture
and sale of surgical instruments and products, to the exclusion of any other
utilization.

 

The
lessee may not modify this intended use on any pretext, even temporarily, nor
may it change the nature of the activity conducted on the premises.

 

The
lessee may, however, add associated or complementary activities, although on
the explicit condition that it makes its intentions known to the lessor and
asks it for the authorization via extrajudicial process pursuant to Articles L.
145-47 ff. of the Commercial Code.

 

4/            CONDITION OF THE LEASED PREMISES

 

The
lessee accepts the premises in their current condition as of the date of this
agreement.

 

5/            MAINTENANCE

 

To
the exclusion of the repairs stipulated in Article 606 of the Civil Code, which
remain the responsibility of the lessor, the lessee shall maintain the leased
premises in good condition and is responsible for minor repairs necessitated by
its tenancy.

 

The
lessee shall maintain all the installations for its own personal use, including
but not limited to heating, air conditioning, fire extinguishers, electrical
installations, lines and conduits for water, natural gas, electricity,
telephone and miscellaneous fluids, as well as the latches and locks of the
windows, doors and shutters, metal shutters, plate glass, window panes, floors,
tiling, floor coverings, paneling, ceilings etc.

 

The
lessee shall be liable for accidents caused by and to these items.

 

3

 

The
lessee must take all precautions to prevent damage caused by ice or freezing.

 

The
lessee shall also be liable for all repairs that are normally the
responsibility of the lessor, but which may be required either because of the
failure of the lessee to perform repairs for which it is responsible as cited
above, or as a result of wear or damage caused by the lessee, its employees or
its visitors, either in the leased premises or in other parts of the building.

 

6/            REPAIRS AND CONSTRUCTION IN THE
BUILDING

 

The
lessee must permit, regardless of the any annoyances experienced by it, all
repairs, reconstructions, addition of floors and any other construction work
that may be performed in the building and may not request any indemnity or
reduction of the rent, regardless of the scope and duration of the work, and
waiving the provisions of Article 1724 of the Civil Code, even when the work
lasts for a period longer than forty days.

 

The
lessee must immediately inform the lessor of any repair for which the latter is
responsible and the lessee finds is necessary. The lessee may be liable for any
consequences resulting from its failure or delay in notifying the lessor of the
need for such repairs.

 

The
lessee must remove, at its own expense and without delay, all falsework and
decorations, as well as all installations it may have constructed and the
removal of which is necessary for the identification and repair of leaks of all
types, cracks in the exhaust or ventilation ducts, including but not limited to
after fires or seepage and in general for the execution of all construction
work.

 

The
lessee must remove at its own expense and without delay, during the resurfacing
of outside walls, all fixtures, signage etc., the removal of which may be
necessary for the execution of the work.

 

7/            TRANSFORMATIONS AND IMPROVEMENTS
BY THE LESSEE

 

The
lessee may not perform any demolition, construction or any change of layout,
partitioning, make any openings in the walls or install any panel or sign on
the facades or anywhere else in the leased premises without prior written
permission from the lessor. If the work is authorized, the work must be
performed under the supervision of the lessor’s architect, whose fees shall be
paid by the lessee.

 

Upon
the expiration of this lease, all decorations, improvements and constructions
installed by the lessee in the leased premises shall remain the property of the
lessor without any compensation paid to the lessee.

 

8/            FURNISHING AND OBLIGATION TO USE

 

The
lessee must keep the leased premises in continuous use. The lessee must also
furnish the premises and keep them continuously stocked at all times with
equipment, merchandise and furniture of sufficient value to cover the payment
of the rent and the miscellaneous payments or reimbursements that are
associated with the use of the premises.

 

9/            INSURANCE

 

The
lessee must insure with a solvent insurance company and keep covered for the
entire term of the lease all equipment, furniture, merchandise and
miscellaneous items used to

 

4

 

furnish
the leased premises, as well as all the installations and fixtures, in
particular against fire, explosions, water damage and natural disasters.

 

The
coverage must include, among other things, electrical damage, breakage of
computer and office equipment, glass breakage, tangible and intangible damage
resulting from theft or attempted theft, costs of removal and replacement,
removal of debris and demolition, including transport of the rubble, expert’s
fees and indirect losses.

 

The
lessee must also obtain coverage for claims by neighbors and third parties.

 

The
lessee must also purchase insurance covering the pecuniary consequences of its
civil liability, and bodily injury or property damage that may be caused to
third parties, not only as a result of its tenancy and the use of the fixtures
and installations, but also damage and injury caused by its employees and
vicarious agents.

 

The
policy must also provide coverage of the pecuniary consequences of the lessor’s
civil liability on account of any damage that may be caused to third parties by
the buildings, land, walls and fences.

 

The
lessor and its insurors waive all recourse against the lessee, this waiver of
recourse being reciprocal, whereby the lessee and its insurors also waive all
recourse against the lessor.

 

In
response to a first request from the lessor or its representative, the lessee
must provide documentary evidence of the subscription of said insurance
policies and the payment of the corresponding premiums.

 

10/          PREVENTION OF NATURAL AND
TECHNOLOGICAL RISKS

 

The
lessee acknowledges, pursuant to the provisions of Article L. 125-5 of the
Environmental Code, that it has been informed of the status of the leased
premises with regard to natural and technological risks, and that it is aware
of the status of the natural and technological risks. The lessee also
acknowledges receipt of the summary report prepared by the Prefecture of Isère,
as well as the status of the risks, as these documents are annexed to this
Agreement.

 

11/          TAXES AND ASSESSMENTS

 

Independently
of the reimbursements it may be required to make to the lessor, the lessee must
pay all taxes, contributions or assessments for which it is responsible and for
which the lessor may be held liable for any reason whatever, and must prove the
payment of the amounts in question in response to any request from the lessor,
in particular upon the expiration of the lease, before vacating the premises.

 

The
parties explicitly agree that the lessee shall reimburse the lessor for its
percentage of the real-estate tax on the improved property.

 

This
participation shall be payable, at the option of the lessor, either at the end
of the period, upon receipt of the tax assessment, or in installments,
quarterly and in advance, at the same time as the rent for the premises
currently leased, with a settlement at the end of the period, as soon as the
lessor has been informed of the exact amount of said tax.

 

12/          COMPLIANCE WITH GOVERNMENT AND
OTHER REQUIREMENTS

 

The
lessee must obey the requirements, regulations and orders in force, including
but not limited to those related to road maintenance, cleanliness, the police,
the labor inspection office and compliance of the premises with general health
and safety standards, so that the lessor is

 

5

 

protected
and held harmless from any and all claims, and the lessee must be responsible
for all resulting repairs and construction work.

 

If,
now or in the future, there are formal regulations governing the use and
enjoyment of the property or condominium rules for the building, the lessee
must obey all such rules and regulations. The lessee must also comply with any
decision duly adopted by the meeting of the co-owners.

 

13/          CLAIMS FROM OR AGAINST THIRD
PARTIES

 

The
lessee must assume personal responsibility, at its own risk, peril and expense
for any claims made by the other occupants of the building, the neighbors or
third parties, including but not limited to noise, odors, heat or trepidations,
caused by it or by equipment belonging to it, whereby the lessor must be
protected and held harmless from any such claims.

 

Nevertheless,
if the lessor is required to pay any sums as a result of the lessee’s actions,
the lessee shall be required to reimburse the lessor without delay.

 

The
lessee must assume personal responsibility for all damage caused to the leased
premises and all interference with enjoyment caused by the other occupants of
the building, neighbors or third parties and must take action directly against
the parties responsible for the interference, whereby the lessor must be
protected and held harmless.

 

14/          SECURITY

 

The
lessee shall be personally responsible for the security and surveillance of its
premises. The lessor may not in any case or for any reason be held liable for
thefts or misappropriation of which the lessee may be the victim in the leased
premises.

 

15/          DESTRUCTION OF THE LEASED PREMISES

 

If
the premises are totally destroyed by an event which is beyond the lessor’s
control, this lease shall be cancelled ipso jure
without payment of any indemnity.

 

In
the event of a partial destruction of the premises, this lease may be cancelled
without indemnity at the request of either party, notwithstanding the
provisions of Article 1722 of the Civil Code, but without prejudice, for the
lessor, to its potential recourse against the lessee if the destruction was the
fault of the latter.

 

16/          INTERRUPTION IN PUBLIC UTILITIES

 

The
lessor may not be held liable for irregularities or interruptions in the supply
of water, natural gas, electricity or any other analogous public utilities
outside the building, nor is the lessor required to give the lessee advance
notice of interruptions.

 

17/          RETURN OF THE PREMISES

 

On
the occasion of the expiration of the lease, the lessee must notify the lessor
one month in advance of the date on which it plans to vacate the premises so
that the lessor can submit the required information to the tax authorities.

 

6

 

The
lessee must return the keys on the day it vacates the premises, even if that is
before the expiration of the current term of the lease.

 

18/          AMENDMENT - WAIVERS - SEVERABILITY

 

This
agreement may only be amended by an explicit written document in the form of a
bilateral agreement or an exchange of letters.

 

An
amendment of this type may not in any case be deemed to have been made as a
result of a lack of action on the part of either party or a simple failure of
any frequency and duration to enforce its rights. The lessor and the lessee are
free at any time to demand the strict enforcement of the clauses and
stipulations that have not been the subject of an explicit or written
amendment.

 

The
lease is held to be indivisible for the sole benefit of the lessor, in
particular in the case of any sub-lease that may be authorized. In the case of
co-lessees as the result of any change of ownership, the obligation of the
co-lessees shall be deemed joint and indivisible.

 

19/          ASSIGNMENT - SUB-LEASING

 

The
lessee may not:

 

·              allow the enjoyment of the leased
premises to any party whatever in any form whatever, even temporarily, for free
or for a short period, or sub-lease the premises in whole or in part, except
for the benefit of any company having its registered office in France which is
the parent company or subsidiary of the lessee, or for the benefit of any
company having its registered office in France that controls the lessee or is
controlled by the lessee within the meaning of Article L. 233-3-I of the
Commercial Code.

 

·              assign its right to this lease,
except in totality to its business successor, in which case it must obtain
permission for said assignment from the lessor and not simply notify it of the
transfer of the lease, and must give the lessor an execution copy or a copy of
the assignment document which shall serve as title with respect to the
assignee.

 

The
lessee shall remain the guarantor, jointly and severally with its assignee and
all successive assignees, as well as with its sub-lessee or sub-lessees, for
payment of the rent and charges, current and future, and for compliance with
the conditions of this lease.

 

The
lessee may not transfer or assign the lease if any rent or charges are due.

 

20/          RENT

 

This
lease is granted and accepted in exchange for an annual rent, net of taxes of three hundred fifteen thousand eight hundred sixty-five euros
(315,865 €).

 

This
rent will be subject to the value-added tax at the rate in force.

 

The
lessee shall reimburse the lessor for the amount of the tax assessed on the
rent and charges on the occasion of the payment of each installment of the
rent.

 

The
rent shall be payable quarterly and in advance in equal installments of seventy-eight thousand nine hundred sixty-six euros and twenty-five
euro-cents (78,966.25 €) net of taxes, at the lessor’s registered
office or at the offices of the person or company managing the leased premises
in the lessor’s place, for the first time upon delivery of the premises and on
the first day of each calendar quarter thereafter.

 

7

 

Miscellaneous
charges and services shall be reimbursed under the conditions described in
greater detail in the article entitled “Charges” below.

 

The
rent for the premises described above is subject to variations in proportion to
the index of the cost of construction published quarterly by the I.N.S.E.E.

 

This
article constitutes a conventional indexing clause and does not refer to the
triennial revision permitted by law pursuant to Articles 26 and 27 of the
Decree dated September 30, 1953, which shall be applied ipso jure.

 

The
rent shall be adjusted on the basis of this clause every 3 years counting from
the date of entry into force of the lease. The rent shall vary by the same
percentage as the selected index. The indexing shall enter into force
automatically without the requirement for prior notification.

 

If
the selected index is no longer published or can no longer be applied for any
reason whatever, it shall be replaced by the closest index, which shall be
identified, in case of doubt, by an expert acting for both parties, appointed
by agreement between them or, if no agreement can be reached, by an order of
the President of the court in response to a petition from the more diligent
party. If the expert declines to accept the assignment, resigns or is unable to
perform the task for any reason whatever, a replacement shall be appointed in
the same manner.

 

21/          CHARGES

 

The
lessee shall pay, either by direct payment to the supplier or by reimbursement
to the lessor, its proportional share of the costs of maintenance, services and
all other building charges, plus the VAT, where applicable.

 

The
lessee shall pay all the expenses for the supply of water, natural gas, fuel,
telephone, security etc. directly.

 

The
reimbursement to the lessor of all these charges or expenses shall be made at
the same time as the payment of each installment of the rent in the form of
provisional installment payments, with a final settlement once a year.

 

22/          CANCELLATION

 

If
payment in full of even a single installment of the rent or reimbursement of
expenses, charges or services that represent accessory costs is not received
when due, or in the event of a default of any of the conditions of this lease,
and one month after a simple demand for payment or an official demand for
payment from a bailiff has gone unheeded, containing a statement by the lessor
of its intention to invoke this clause, this lease shall be cancelled ipso jure
if the lessor considers it appropriate, without the need to bring formal
proceedings

 

If
the lessee refuses to vacate the premises, it may be evicted without delay by a
simple interim order issued by the President of the Regional Court of Grenoble
and immediately enforceable, notwithstanding any appeal.

 

23/          SECURITY DEPOSIT

 

The
lessor shall receive from the lessee the sum of seventy-eight
thousand nine hundred sixty-six euros (78,966 €) corresponding to
three (3) months of rent, in payment of the rent

 

8

 

and
to guarantee the proper performance of the terms and conditions of this lease,
repairs resulting from the tenancy and all amounts owed by the lessee for which
the lessor could be held liable.

 

23/          COSTS

 

The
lessee shall pay all the costs relating to this agreement and its successors.

 

24/          ADDRESS OF SERVICE

 

For
the performance of this agreement and its successors, the parties elect address
of service at the location of their respective registered offices.

 

Executed
in Montbonnot in two originals

on
December 29, 2007

 

	
  for SCI CYMAISE

  	
   

  	
  for SAS “TORNIER”

  
	
  Alain
  Tornier

  	
   

  	
  Douglas
  Kohrs

  
	
   

  	
   

  	
   

  
	
  /s/
  Alain Tornier

  	
   

  	
  /s/
  Douglas Kohrs

  

 

9

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