Onto Innovation (ONTO) 10-Q 2009 Q2 Quarterly report

Exhibit 10.11

THIRD AMENDMENT

TO LOAN AND SECURITY AGREEMENT

This Third Amendment to Loan and Security Agreement (this “Amendment”) is entered into as of June 15, 2009, by and between COMERICA BANK (“Bank”) and NANOMETRICS INCORPORATED (“Borrower”), successor by merger to ACCENT OPTICAL TECHNOLOGIES NANOMETRICS, INC., successor by merger to NANOMETRICS IVS DIVISION, INC.

RECITALS

Borrower and Bank are parties to that certain Loan and Security Agreement dated as of February 14, 2007, as amended from time to time, including, without limitation by that certain First Amendment to Loan and Security Agreement dated September 14, 2007 and that certain Second Amendment to Loan and Security Agreement dated as of April 29, 2009 (collectively, the “Agreement”). The parties desire to amend the Agreement in accordance with the terms of this Amendment.

NOW, THEREFORE, the parties agree as follows:

1. The definition of “Base Amount” set forth in Exhibit A to the Agreement is hereby amended and restated to read in its entirety as follows:

“Base Amount” shall mean, as of the last date of any fiscal quarter, the amount set forth in the table below for such fiscal quarter:

Fiscal Quarter Ending	Base Amount
March 28, 2009	$	75,000,000.00
June 27, 2009, and at all times thereafter	$	65,000,000.00

2. No course of dealing on the part of Bank or its officers, nor any failure or delay in the exercise of any right by Bank, shall operate as a waiver thereof, and any single or partial exercise of any such right shall not preclude any later exercise of any such right. Bank’s failure at any time to require strict performance by Borrower of any provision shall not affect any right of Bank thereafter to demand strict compliance and performance. Any suspension or waiver of a right must be in writing signed by an officer of Bank.

3. Unless otherwise defined, all initially capitalized terms in this Amendment shall be as defined in the Agreement. The Agreement, as amended hereby, shall be and remain in full force and effect in accordance with its respective terms and hereby is ratified and confirmed in all respects. Except as expressly set forth herein, the execution, delivery, and performance of this Amendment shall not operate as a waiver of, or as an amendment of, any right, power, or remedy of Bank under the Agreement, as in effect prior to the date hereof.

4. Borrower represents and warrants that the Representations and Warranties contained in the Agreement are true and correct as of the date of this Amendment, and that no Event of Default has occurred and is continuing.

5. As a condition to the effectiveness of this Amendment, Bank shall have received, in form and substance satisfactory to Bank, the following:

(a) this Amendment, duly executed by Borrower;

(b) all reasonable Bank Expenses incurred through the date of this Amendment, which may be debited from any of Borrower’s accounts; and

(c) such other documents, and completion of such other matters, as Bank may reasonably deem necessary or appropriate.

6. This Amendment may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one instrument.

[Remainder of Page Intentionally Left Blank]

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IN WITNESS WHEREOF, the undersigned have executed this Amendment as of the first date above written.

NANOMETRICS, INC.
By:	/s/ James Moniz
Name: Title:	James Moniz CFO

COMERICA BANK
By:	/s/ Stephanie R. Karic
Name: Title:	Stephanie R. Karic Vice President

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