Exhibit 10.1

 

SECOND AMENDMENT TO LEASE

 

This SECOND AMENDMENT TO LEASE (“Second Amendment”) is made as of the seventh
(7th) day of July, 2010, by and between 5200 PATRICK HENRY ASSOCIATES LLC, a
Delaware limited liability company (“Landlord”), and COHERENT, INC., a Delaware
corporation (“Tenant”).

 

RECITALS

 

A.            Landlord (as successor-in-interest to S B C & D Co., Inc.) and
Tenant are parties to that certain Lease dated September 14, 2007 (the “Original
Lease”) pursuant to which Landlord leases to Tenant, and Tenant leases from
Landlord, that certain premises, consisting of approximately ninety thousand one
hundred twenty (90,120) square feet of gross leasable area, the address of which
is 5200 Patrick Henry Drive, Santa Clara, California, and which is located
within the Building as shown on Exhibit A attached to the Original Lease (the
“Premises”).

 

B.            Landlord and Tenant are parties to that certain First Amendment to
Lease dated February 4, 2008 (the “First Amendment”) pursuant to which, among
other things, Landlord agreed to construct or install certain tenant
improvements in the Premises for the benefit of Tenant and the Base Monthly Rent
required to be paid by Tenant to Landlord pursuant to the terms of the Original
Lease was modified. The Original Lease, as amended by the First Amendment, is
referred to herein as the “Lease”.

 

C.            The initial Term of the Lease is currently scheduled to expire on
April 30, 2015.   Subject to the terms and conditions set forth in this Second
Amendment,  Tenant and Landlord desire to amend, modify and supplement, as the
case may be, the Lease to, among other things, (i) extend the expiration date of
the initial Term of the Lease to July 31, 2020, (ii) establish the Base Monthly
Rent payable by Tenant to Landlord during the period commencing August 1, 2010
through July 31, 2020, (iii) provide for the right of Tenant to undertake, or
cause to be undertaken, certain alterations or improvements in a portion of the
Premises (not exceeding twenty percent of the entire Premises) without any
obligation to restore such limited area in which such alterations or
improvements are undertaken, and (iv) provide for an extension of the leak
maintenance contract Landlord has obtained with respect to the roof of the
Building in which the Premises are located.

 

D.            Capitalized terms used in this Second Amendment shall have the
meaning ascribed to such terms in the Lease, unless otherwise defined in this
Second Amendment.

 

NOW, THEREFORE, in consideration of the foregoing recitals and other
consideration, the sufficiency of which is hereby acknowledged, the parties
hereto amend, modify and supplement the Lease as follows:

 

1.             Extension of Initial Lease Term.  Notwithstanding anything to the
contrary contained in the Lease, Landlord and Tenant hereby extend the
expiration date of the initial Term of the Lease to July 31, 2020.  Section J of
the Summary of Basic Lease Terms

 

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incorporated into the Original Lease is hereby amended to provide that the
initial Lease Term is extended through and including July 31, 2020, unless
sooner terminated or extended in accordance with the terms of the Lease
(including pursuant to the extension options in Section 2.6 of the Lease), as
amended by this Second Amendment.  Tenant shall continue to have two (2) options
to extend the Lease Term at the end of the extended initial Lease Term as
provided in Section 2.6 of the Lease.

 

2.             Condition of Premises.  Tenant hereby agrees and warrants that it
is familiar with the condition of the Premises and the suitability of same for
Tenant’s purposes, and, except to the extent the same are Landlord’s
responsibility under the Lease, Tenant does hereby waive and disclaim any
objection to, cause of action based upon, or claim that its obligations
hereunder should be reduced or limited because of, the existing condition of the
Premises, the Building in which the Premises is located or the Project, or any
portion thereof, or the suitability of the same for Tenant’s purposes.  Tenant
acknowledges that neither Landlord nor any agent nor any employee of Landlord
has made any representations or warranty with respect to the Premises, the
Building in which the Premises is located or the Project, except to the extent
expressly set forth in the Lease, or with respect to the suitability of same for
the conduct of Tenant’s business.  Tenant further agrees and acknowledges that
Landlord has no obligation to alter, improve or refurbish the Premises, or any
portion thereof, for Tenant’s use or benefit, except as expressly required under
the Lease, or to provide Tenant an allowance for such purpose.  Tenant also
acknowledges and agrees that, to Tenant’s actual knowledge, without inquiry, all
Tenant Work and Tenant Improvements required by the Lease to be completed by
Landlord have been completed in the manner and in accordance with the terms,
conditions and covenants set forth in the Lease to the satisfaction of Tenant
and have been accepted by Tenant, and no further payments are required to be
made to Tenant in connection therewith.

 

3.             Base Monthly Rent.  The Base Monthly Rent schedule set forth in
Paragraph 4 of the First Amendment shall remain in effect through July 31,
2010.  Effective as of August 1, 2010, Paragraph 4 of the First Amendment and
Section K of the Summary of Basic Lease Terms incorporated into the Original
Lease shall be deemed amended to provide that Tenant shall pay Base Monthly Rent
each month during the balance of the initial Lease Term, commencing on August 1,
2010, in accordance with the schedule set forth below:

 

Balance of Initial Term

 

Base Monthly Rent
(NNN)

 

08/01/2010 – 07/31/2011

 

$

126,168.00

 

08/01/2011 – 07/31/2012

 

$

130,583.88

 

08/01/2012 – 07/31/2013

 

$

135,154.32

 

08/01/2013 – 07/31/2014

 

$

139,884.72

 

08/01/2014 – 07/31/2015

 

$

144,780.69

 

08/01/2015 – 07/31/2016

 

$

149,848.01

 

08/01/2016 – 07/31/2017

 

$

155,092.69

 

08/01/2017 – 07/31/2018

 

$

160,520.93

 

08/01/2018 – 07/31/2019

 

$

166,139.16

 

08/01/2019 – 07/31/2020

 

$

171,954.03

 

 

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Base Monthly Rent shall be paid by Tenant to Landlord during the Lease Term, as
the same may be extended, on the first day of each month of the Lease Term,
without offset or deduction (except as expressly provided in Sections 7.3, 11.4
and 12.3 of the Lease), prior notice or demand in lawful money of the United
States addressed to Landlord, c/o South Bay Development Company, 1690 Dell
Avenue, Campbell, CA 95008 or to such other persons or such other places as
Landlord may designate in writing. Base Monthly Rent for any period during the
Lease Term, as the same may be extended, which is for less than one month shall
be prorated based upon the actual number of days of the calendar month involved.

 

5.             Tenant Alterations.  Tenant shall have the right, without having
to obtain Landlord’s prior written approval but upon prior written notice to
Landlord (other than for Minor Alterations that do not require a building
permit) and subject to all the other terms and conditions of Sections 5.2 and
5.5 of the Original Lease (except as otherwise provided immediately below), to
make, or cause to be made, at Tenant’s sole cost and expense, Tenant Alterations
during the Lease Term, as the same may be extended, in the aggregate in not more
than twenty percent (20%) of the square footage of the Premises provided that
such Tenant Alterations (i) do not impair the structural integrity of the
Building, (ii) do not adversely affect the life safety system, plumbing,
electrical or heating, ventilation and air conditioning system serving the
Building or the ceiling grid of the Building, and/or (iii) do not adversely
affect the roof of the Building.  Such Tenant Alterations (once construction or
installation of the same in the Premises is completed and written notice of such
completion is given by Tenant to Landlord), together with all Tenant Alterations
performed by Tenant prior to the date hereof, shall constitute Tenant Insured
Alterations and be insured by Landlord as referred to in Section 9.2.A of the
Original Lease.  The scope of such Tenant Alterations referred to in the first
sentence of this Paragraph 5 may include, provided the same are contained within
twenty percent (20%) of the square footage of the Premises and such Tenant
Alterations do not violate any of the conditions set forth in clauses (i),
(ii) or (iii) above, the addition of twelve to eighteen private offices in the
open office area within the right side of the Building and/or the conversion of
office space to light manufacturing, research and development or lab space or
the conversion of light manufacturing, research and development or lab space to
office space, and the construction of an additional restroom core. 
Notwithstanding anything to the contrary contained herein or in the Lease,
Tenant shall not be obligated to remove any of the Tenant Alterations made or
caused to be made by Tenant pursuant to the terms of the first sentence of this
Paragraph 5 so long as the total floor area (including area of converted space
referred to above) in which such Tenant Alterations in the aggregate are made
does not exceed twenty percent (20%) of the square footage of the entire
Premises.  If the total floor area (including converted space) in which Tenant’s
Alterations in the aggregate are made or caused to be made pursuant to the terms
above exceeds twenty percent (20%) of the total square footage of the entire
Premises, then, anything herein or in the Lease to the contrary notwithstanding,
unless Landlord agrees in

 

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writing at the time Tenant makes such Tenant Alteration that such Tenant
Alteration may be surrendered to Landlord as part of the realty and become
Landlord’s property at the expiration or earlier termination of the Lease,
Landlord shall have the right, by giving written notice thereof to Tenant at any
time prior to ninety (90) days prior to the expiration or earlier termination of
the Lease, as amended hereby, to require Tenant, at Tenant’s sole cost, to
remove any or all of such Tenant’s Alterations constructed or installed in any
area of the Premises exceeding twenty percent (20%) of the total square footage
of the entire Premises and to restore such area to the condition existing
immediately prior to the construction or installation of such Tenant
Alterations.  If, pursuant to the terms of the immediately preceding sentence,
Landlord requires Tenant to remove any of the Tenant Alterations constructed or
installed in more than twenty percent (20%) of the total square footage of the
entire Premises, then Tenant shall, at its sole cost, prior to the expiration or
earlier termination of the Lease Term, remove such Tenant Alterations designated
by Landlord for removal and restore such area to the condition existing
immediately prior to the construction or installation of such Tenant Alterations
designated for removal.

 

6.                                       Roof Membrane.

 

(a)           The second sentence of the first paragraph of Section 6.2 of the
Original Lease is hereby deleted in its entirety and the following is
substituted in place thereof:  “Notwithstanding Section 6.1 above, Landlord will
enter into an annual maintenance and repair contract with a roof membrane
maintenance contractor selected by Landlord, and obtain a leak-free warranty
from such maintenance contractor, with respect to the foam portion of the roof
membrane.  Pursuant to such maintenance contract, the maintenance contractor
will perform, at no cost to Tenant, annual maintenance inspections of, and make
repairs to, the foam portion of the roof membrane of the Building and such
maintenance contractor shall also provide a leak-free warranty with respect to
the foam portion of the roof membrane of the Building through the initial Lease
Term expiring July 31, 2020; provided, however, such repair work and leak-free
warranty shall not extend to or cover repairs or leaks that occur due to
Tenant’s breach of any of its maintenance responsibilities set forth in
Section 6.1 or the negligence or willful misconduct of Tenant or any of its
agents, employees, contractors, assignees, subtenants or other representatives
or wind-driven rain penetrating underneath flashing.   The work to be performed
pursuant to the annual maintenance inspection and repair contract referred to
immediately above shall be similar to that described in the letter dated May 23,
2008, attached hereto as Exhibit A.  Landlord also agrees to extend the term of
such annual maintenance inspection and repair contract and leak-free warranty
with respect to the foam portion of the roof membrane of the Building through
July 31, 2020 as set forth in the letter dated July 7, 2010 attached hereto as
Exhibit B.  If Tenant reasonably determines that there are any leaks in the foam
portion of the roof membrane of the Building, Tenant may contact the
aforementioned roof membrane maintenance contractor retained by Landlord
directly and request that such maintenance contractor visit the Building to
inspect such foam portion of the roof membrane, which inspection shall be at
Landlord’s sole cost.”  The costs of the maintenance contract and related minor
repairs described in this Paragraph 6(a) and covered by the annual maintenance
inspection and repair contract referred to above shall be at Landlord’s sole
cost and shall not be an Operating Expense; provided, however, if any repairs
(whether minor or not) or replacements of

 

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any portion of the foam portion of the roof membrane are necessitated due to
Tenant’s breach of any of its maintenance responsibilities set forth in
Section 6.1 or the negligence or willful misconduct of Tenant or any of its
agents, employees, contractors, assignees, subtenants or other representatives,
then Tenant shall be responsible, at its sole cost and expense, for undertaking,
or causing to be undertaken, such repair or replacement of the foam portion of
the roof membrane.

 

(b)           Section 6.2.C. of the Original Lease is hereby deleted in its
entirety and the following is hereby substituted in place thereof:  “Repairs or
replacements of the foam portion of the roof membrane required to be made at any
time during the initial Lease Term ending July 31, 2020 will be covered and
repaired at no cost to Tenant; provided, however, if repairs or replacements of
any portion of the roof membrane are necessitated due to Tenant’s breach of any
of its maintenance responsibilities set forth in Section 6.1 or the negligence
or willful misconduct of Tenant or any of its agents, employees, contractors,
assignees, subtenants or other representatives, then Tenant shall be
responsible, at its sole cost and expense, for undertaking, or causing to be
undertaken, such repair or replacement of the roof membrane.  If repairs or
replacements of the foam portion of the roof membrane constituting a capital
expenditure arise during any extended term of the Lease (i.e. after the initial
Lease Term ending July 31, 2020), then Landlord will be responsible for
undertaking such repair or replacement and Tenant will pay the amortized cost of
the same in accordance with Sections 5.4.A and B of this Lease; provided,
however, if repairs or replacements of any portion of the roof membrane are
necessitated due to Tenant’s breach of any of its maintenance responsibilities
set forth in Section 6.1 or the negligence or willful misconduct of Tenant or
any of its agents, employees, contractors, assignees, subtenants or other
representatives, then Tenant shall be responsible, at its sole cost and expense,
for undertaking, or causing to be undertaken, such repair or replacement of the
roof membrane.”

 

(c)           The parties hereto acknowledge that there is an elastomeric
coating on the foam portion of the roof membrane of the Building.  If the
elastomeric coating on at least twenty-five percent (25%) of the foam portion of
the roof membrane wears down to a thickness of less than twelve millimeters
(with such measurement to be conducted by the roof membrane maintenance
contractor referred to above once per calendar year during the Lease Term, as
extended), then Landlord shall cause such elastomeric coating on the roof
membrane of the Building to be re-coated to a thickness of approximately
twenty-four millimeters.  The cost of such re-coating shall be borne by Landlord
and not be passed through to Tenant during the initial Lease Term ending
July 31, 2020.   If such re-coating of the elastomeric coating on the foam
portion of the roof membrane of the Building occurs during any extended term of
the Lease (i.e. after July 31, 2020), then Landlord will be responsible for
undertaking such re-coating and Tenant will pay the amortized cost of the same
in accordance with Sections 5.4.A and B of this Lease; provided, however, if
such re-coating is necessitated due to Tenant’s breach of any of its maintenance
responsibilities set forth in Section 6.1 or the negligence or willful
misconduct of Tenant or any of its agents, employees, contractors, assignees,
subtenants or other representatives, then Tenant shall be responsible, at its
sole cost and expense, for undertaking, or causing to be undertaken, such
re-coating of the elastomeric coating of the roof membrane of the Building.

 

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7.             Lender Consent.  Concurrently with its execution hereof, Landlord
shall deliver to Tenant the consent to this Second Amendment of all Lenders.

 

8.             Brokers.  Each party represents and warrants to the other party
that it has not had dealings in any manner with any real estate broker, finder
or other person other than Colliers International to whom a real estate
commission or finder’s fee may be owed with respect to the extension of the
Lease Term as provided in Paragraph 1 of this Second Amendment and the
negotiation and execution of this Second Amendment.  In connection with Tenant’s
extension of the Lease Term as provided in Paragraph 1 of this Second Amendment
and Landlord’s and Tenant’s negotiation and execution of this Second Amendment,
Landlord agrees to pay to Colliers International a commission pursuant to the
terms of a separate agreement between Landlord and Colliers International. 
Colliers International shall not be a third party beneficiary of this Second
Amendment. Except as to commissions to be paid as provided under this Paragraph
8, Tenant shall indemnify, defend and hold harmless Landlord from all damage,
loss, liability and expense (including attorneys’ fees and related costs)
arising out of or resulting from any claims for commissions or fees that may or
have been asserted against Landlord by any broker, finder or other person with
whom Tenant has or purportedly has dealt with in connection with the extension
of the Lease Term as provided in Paragraph 1 of this Second Amendment and the
negotiation and execution of this Second Amendment.

 

9.             Corporate Authority.  Tenant represents and warrants to Landlord
that (i) Tenant is the sole holder of the leasehold estate created under the
Lease, (ii) Tenant has not voluntarily, by operation of law or otherwise
assigned the Lease or any interest of Tenant under the Lease, subleased any
portion of the Premises or otherwise transferred or hypothecated any interest of
Tenant in and to the Lease or the Premises, or any portion thereof, and
(iii) all authorizations necessary for the execution of this Second Amendment by
Tenant and to bind Tenant hereto have been obtained.  Upon written request
therefor made by Landlord to Tenant, Tenant shall provide Landlord with a
corporate resolution, certificate of incumbency or other evidence reasonably
satisfactory to Landlord that the individual(s) executing this Second Amendment
on behalf of Tenant are authorized to execute this Second Amendment and to bind
Tenant hereto.

 

10.           Effect of Second Amendment.  Except as modified herein, the terms
and provisions of the Lease shall remain unmodified and continue in full force
and effect.  In the event of any conflict or inconsistency between the terms and
provisions of this Second Amendment and the terms and provisions of the Lease,
the terms and provisions of this Second Amendment shall prevail.

 

11.           Counterparts; Facsimile Signatures. This Second Amendment may be
executed in counterparts, each of which shall be deemed an original and together
shall constitute one instrument. The parties contemplate that they may be
executing counterparts of this Second Amendment transmitted by facsimile or
email in PDF format and agree and intend that a signature by either facsimile
machine or email in PDF format shall bind the party so signing with the same
effect as though the signature were an original signature.

 

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12.           Governing Law.   This Second Amendment shall be governed by and
construed in accordance with the laws of the State of California.

 

13.           Interpretation.  The doctrine or rule of law or construction that
any ambiguity in a written instrument shall be construed against the party
drafting the same shall not be employed in connection with this Second
Amendment.

 

[balance of page is intentionally blank; signature page follows on next page]

 

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IN WITNESS WHEREOF, the parties hereto have executed this Second Amendment as of
the date and year set forth below.

 

LANDLORD:

 

TENANT:

 

 

 

5200 PATRICK HENRY ASSOCIATES LLC,
a Delaware limited liability company

 

COHERENT, INC.,
a Delaware corporation

 

 

 

By:

P 7 5200 PATRICK HENRY LLC,

 

By:

/s/ John Ambroseo

 

a Delaware limited liability company

 

Name:

John Ambroseo

Its:

Managing Member

 

Title:

CEO

 

 

 

 

 

By:

/s/ Robert J. Murray

 

By:

/s/ Helene Simonet

 

Name:

Robert J. Murray

 

Name:

Helene Simonet

 

Its:

Vice President

 

Title:

CFO

 

 

 

 

 

 

Dated:

July 26, 2010

 

Dated:

July 23, 2010

 

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