Document:

Exhibit 10.51

 

AMENDMENT NO. 2 TO LEASE

 

THIS AMENDMENT NO. 2 TO LEASE (“Amendment”) is made as of May 25, 2011, by and between ST. PAUL FIRE AND MARINE INSURANCE COMPANY, a Connecticut corporation (“Landlord”) and KIPS BAY MEDICAL, INC., a Delaware corporation (“Tenant”).

 

RECITALS:

 

A.                                   St. Paul Properties, Inc., a Delaware corporation (“Properties”) and Tenant were parties to that certain Lease dated July 26, 2007 (the “Original Lease”), for premises described therein (the “Premises”).

 

B.                                     On October 9, 2009, Properties merged with and into Landlord, Properties’ only, shareholder with Landlord being the survivor of the merger; and

 

C.                                     Landlord and Tenant entered into a certain Amendment No. 1 to Lease dated June 14, 2010 (the “First Amendment”; the Original Lease and the First Amendment may be referred to herein collectively as the “Lease”).

 

D.                                    In September, 2010, Landlord changed the jurisdiction of its organization from Minnesota to Connecticut.

 

E.                                      Landlord and Tenant wish further to amend the Lease to reflect certain additional agreements between them,

 

NOW, THEREFORE, in consideration of the Premises and for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as set forth below.

 

AGREEMENT:

 

1.                                       Defined Terms. Unless otherwise indicated, capitalized terms shall be defined in the manner set forth in the Lease.

 

2.                                       Extension of Term. The Term of the Lease is hereby extended for a period of thirty six (36) months commencing October 1, 2011 (the “Second Extension Commencement Date”) and ending on September 30, 2014 (such period the “Second Extension Term”).

 

3.                                       Base Rent. During the Second Extension Term, Tenant shall pay Base Rent for the Premises in the amount of:

 

(a)                                  $44,532.00 per annum ($3,711.00 per month) for the period beginning on the Second Extension Commencement Date through and including September 30, 2012;

 

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(b)                                 $45,670.08 per annum ($3,805.84 per month) for the period beginning on October 1, 2012, through and including September 30, 2013; and

 

(c)                                  $46,808.04 per annum ($3,900.67 per month) for the period beginning on October 1, 2013, through and including September 30, 2014,

 

without deduction or setoff therefrom, payable at the time and in the manner set forth in the Lease, as amended by this Amendment, for the payment of Base Rent.

 

4.                                       Amendments.

 

(a)                                  Effective on the date of this Amendment, Landlord’s address for the payment of Rent appearing in the Data Sheet is deleted and the following substituted therefor:

 

“St. Paul Fire and Marine Insurance Company 
 c/o NorthMarq Real Estate Services 
 SDS-12-2659, PO Box 86 
 Minneapolis, MN 55486-2659”

 

(b)                                 Effective on the date of this Amendment, the notice addresses for Landlord and for Landlord’s Managing Agent appearing in the Data Sheet are deleted and the following substituted therefor:

 

	
“Landlord:
    
   St. Paul Fire and Marine Insurance Company
   385 Washington Street
   St. Paul, Minnesota 55102
    	
Landlord’s   Managing Agent
    
   Northmarq Realty Services, LLC
   3500 American Boulevard West, Suite 200
   Bloomington; Minnesota 55431
    
	
Attention:
    	
Vice   President —
   Asset Management
    	
Attention:
    	
Vice   President
   Property Management”
    
				

 

(c)                                  Effective on the date of this Amendment, Paragraphs 31, 32 and 33 of the Original Lease and Paragraph 4 of the First Amendment are deleted and of no further force or effect. The parties acknowledge and agree that the extension of the Term contemplated by Paragraph 2 hereof constitutes the exercise of the right of renewal granted by Paragraph 32 of the Original Lease and that Tenant has no further rights of renewal or extension.

 

5.                                       Additional Agreements.

 

(a)                                  As-Is Condition. Landlord and Tenant agree that on the Second Extension Commencement Date, Tenant shall accept the Premises in their then AS-IS, WITH ALL FAULTS CONDITION. Tenant acknowledges that neither Landlord nor any agent or employee of Landlord has made any representation or warranty with respect to the

 

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Premises or any other portion of the Building, including, without limitation, any representation or warranty with respect to the suitability or fitness of the Premises or any other portion of the Building for the conduct of Tenant’s business in the Premises.

 

(b)                                 Brokerage. Each of the parties agrees that it has had no dealings with any broker other than NorthMarq Realty Services (Jason Meyer) as to Landlord and Jones Lang LaSalle (Chris Hickok) as to Tenant, and each party hereby agrees to defend, indemnify and hold the other harmless from and against all costs, expenses, attorneys’ fees or other liability for commissions or other compensation or charges claimed by any broker or agent other than the brokers listed above claiming by or through Landlord or Tenant, respectively, with respect to this Amendment.

 

6.                                       Reference to and Effect on the Lease.

 

(a)                                  Upon the effectiveness of this Amendment, each reference in the Lease to “this Lease”, “hereunder”, “hereof’, “herein” or words of like import referring to the Lease shall mean and be a reference to the Lease as amended hereby.

 

(b)                                 Except as specifically set forth above, the Lease remains in full force and effect and is hereby ratified and confirmed.

 

(c)                                  Wherever there exists a conflict between this Amendment and the Lease, the provisions of this Amendment shall control.

 

(d)                                 This Amendment, together with the Lease, constitute the complete agreement of Landlord and Tenant as to the matters set forth herein and may not be waived, modified or changed, except by writing signed by both Landlord and Tenant.

 

7.                                       Governing Law. This Amendment shall be governed by and construed in accordance with the laws of the State of Minnesota.

 

8.                                       Counterparts. This Amendment may be executed in counterparts, all of which, when taken together, shall constitute one and the same original.

 

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.

 

9.                                       Time of Essence. Time shall be of the essence as to each and every provision of this amendment.

 

SIGNATURE PAGE FOLLOWS

 

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

 

	
LANDLORD:
    	
 
    	
TENANT:
    
	
 
    	
 
    	
 
    
	
ST.   PAUL FIRE AND MARINE
    	
 
    	
KIPS   BAY MEDICAL, INC.
    
	
INSURANCE   COMPANY
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/   Michael D. Elnicky
    	
 
    	
By:
    	
/s/   Scott Kellen
    
	
 
    	
Name:
    	
Michael D. Elnicky
    	
 
    	
 
    	
Name:
    	
Scott   Kellen
    
	
 
    	
Its:
    	
ASSET   MANAGER
    	
 
    	
 
    	
Its:
    	
CFO
    

 

4Exhibit 10.52

 

SUBLEASE

 

THIS SUBLEASE is made on June 2, 2011, by New Horizon Enterprises, Ltd. (“Sublandord”), whose address is 3405 Annapolis Lane suite 100 Plymouth, MN 55447, and Kips Bay Medical, Inc(“Subtenant”), whose address is 3405 Annapolis Lane suite 200 Minneapolis, MN, 55447.

 

RECITALS

 

St Paul Fire and Marine Insurance Company, as landlord (“Landlord”), and Sublandlord, as tenant, entered into a Lease dated January, 2010, (the “Prime Lease”), with regard to the premises at 3405 Annapolis Lane Suite 100 Plymouth, Minnesota (the “Premises”). A copy of the Prime Lease is attached to this Sublease as Exhibit A. Sublandlord wishes to Sublease to Subtenant, and Subtenant wishes to Sublease from Sublandlord, the Premises consisting of 2,793 sf as depicted on Exhibit B attached hereto (the “Subleased Premises”). Accordingly, Sublandlord and Subtenant agree:

 

1.               Agreement. Sublandlord subleases the Subleased Premises to Subtenant, and Subtenant subleases the Subleased Premises from Sublandlord, according to this Sublease. The provisions of the Prime Lease are incorporated into this Sublease as the agreement of Sublandlord and Subtenant as though Sublandlord were Landlord under the Prime Lease and Subtenant were tenant under the Prime Lease.

 

2.               Term. The term of this Sublease will begin on June 15, 2011, and will end on September 30, 2014, co-terminus with Subtenant’s current facility lease.

 

3.               Rent. Subtenant will pay Sublandlord as rent for the Subleased Premises in the amounts and on the dates listed below, in advance, without notice, demand, offset or counterclaim, on the fifth day of each month. Rent will be paid to Sublandlord at Sublandlord’s address above. If the term of this Sublease begins on any day other than the first day of a month, rent will be prorated on a per diem basis.

 

	
Date
    	
 
    	
Net Rent psf
    	
 
    	
Monthly Net Rent
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Months 1-40
    	
 
    	
$
    	
11.00
    	
 
    	
$
    	
2,560.25
    	
 
    
								

 

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3A:                             Utilities: The Sublandlord agrees to bill the Subtenant monthly its proportionate share of gas and electric bills. Subtenant agrees to remit payment to Subtenant within 30 days of receipt of such bill.

 

3B:                               Operating Costs/Taxes: Subtenant shall pay Sublandord its pro rata share of Operating Costs and Taxes. Such amount shall be billed monthly and paid in accordance with rent.

 

3C:                               Security Deposit: Upon execution of this Sublease Agreement, Subtenant shall deliver a check to Sublandlord in the amount of $7,680.75 as a security deposit. The sum of $1,280.12 of such security deposit shall then be applied to rent due and payable over the first full six (6) months of the Sublease provided that there has not been an Event of Default by Subtenant.

 

3D:                              Landlord Expenses: Subtenant agrees to pay any costs incurred by Landlord in connection with the consent to sublease as set forth in Section 11 of the Prime Lease.

 

4.               Acceptance of the Premises. Subtenant accepts the Subleased Premises in their present “as is” condition including all items still remaining in the space. Sublandlord will not be obligated to make any alterations or improvements to the Subleased Premises on account of this Sublease. Sublandlord agrees to lease to Subtenant the cube furniture for a monthly amount of $465.50.

 

5.               Additional Improvements and Signage. As stated above, the provisions of the Prime Lease are incorporated into this Sublease and all applicable provisions of the lease related to additional improvements and signage are expressly incorporated herein.

 

6.               Improvements. The Sublandlord acknowledges that the Subtenant will be performing at its cost the demising work and additional restroom outlined on Exhibit B. The Subtenant also agrees to restore the premises to its original condition as of the date of this sublease, including removing the interior wall that Subtenant erected and replacing the interior wall Subtenant removed and repairing all walls and flooring to its original condition at its sole cost and expense. Notwithstanding the foregoing, Subtenant will not be required to remove those extensions of interior walls, existing as of the date of this sublease, above ceiling level and up to the roof deck. Upon termination of the Sublease, Subtenant shall also surrender the Subleased Premises broom clean in good order, condition and repair, reasonable wear and tear only excepted.

 

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7.               The Prime Lease. This Sublease is subject to the Prime Lease. Except as may be inconsistent with the terms hereof, all provisions of the Prime Lease are applicable to this Sublease as though Landlord under the Prime Lease were the Sublandlord under this Sublease and tenant under the Prime Lease were Subtenant under this Sublease. Subtenant has received a copy of the Prime Lease. Subtenant will not cause or allow to be caused any default under the Prime Lease. Subtenant will indemnify Sublandlord against any loss, liability, and expenses (including reasonable attorney’s fees and costs) arising out of any default under the Prime Lease caused by Subtenant, and Sublandlord will indemnify Subtenant against any loss, liability, and expenses (including reasonable attorneys’ fees and costs) arising out of any default under the Prime Lease caused by Sublandlord. Also, Subtenant hereby agrees to join in future amendments to the Prime Lease. All capitalized terms not defined herein shall have the same meaning and effect as set forth under the Prime Lease.

 

8.               Notices and Right to Cure. Subtenant must deliver copies of any notices the Subtenant receives from the Landlord.

 

9.               The covenants and agreement herein contained shall bind and inure to the benefit of Sublandlord, Subtenant, and their respective heirs, executors, administrators, successors and assigns.

 

10.         This Sublease is made contingent upon receipt of a signed Consent to Sublease form by Landlord, which shall be obtained on or before June 15, 2011.

 

Sublandlord and Subtenant have executed this Sublease on the date first written above.

 

	
New   Horizon Enterprises, Ltd.
    	
 
    	
 
    
	
(Sublandlord)
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/   Jill Gilbertson
    	
 
    	
 
    
	
Its:
    	
Dir.   Bus. Dev.
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
Kips Bay Medical, Inc
    	
 
    	
 
    
	
(Subtenant)
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
By:
    	
/s/   Scott Kellen
    	
 
    	
 
    
	
Its:
    	
Chief   Financial Officer
    	
 
    	
 
    

 

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