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EXHIBIT 10.2
ADDENDUM TO
THE KONTRABECKI GROUP
INDUSTRIAL LEASE
This Addendum V is executed by and between KONTRABECKI ASSOCIATES I, a
California limited partnership as Landlord, and INTEVAC CORPORATION, a
California Corporation, as Tenant with respect to those certain Premises
commonly known as 3550, 3560, 3570 and 3580 Bassett Street, Santa Clara, CA.
This addendum is an integral part of the printed lease to which it is attached;
provided, the provisions of this Addendum VI supersede the provisions of the
printed lease and the addendum thereto to the extent inconsistent therewith.
1. Premises - Effective April 1, 1997, the term "Premises" as defined in
paragraph 1.3 of the Lease shall be modified to include the area outlined on
the site plan attached hereto as Exhibit "A5" containing seventy-three thousand
and ninety-three (73,093) square feet. Effective April 1, 1997, the Premises
Gross Leasable Area shall be equal to one hundred sixty-seven thousand and
sixty-three (167,063) square feet (49,080 square feet plus 44,890 square feet
plus 73,093).
2. Term - The term as set forth in paragraph 2.2 of the Lease shall be
modified as follows:
Additional Commencement/
Address Premises Term Expiration Date
- ------- -------- ---------- ---------------
3570-3580 Bassett St. 44,890 s.f. 33 months 7/1/99-3/31/02
3560 Bassett St. 73,093 s.f. 60 months 4/1/97-3/31/02
3550 Bassett St. 49,080 s.f. 33 months 7/1/99-3/31/02
3. Rent - The term "Base Rent" as defined in paragraph 3.1 of the Lease shall
be modified as follows:
Rent - 3560 Bassett Street:
Year Rent/Mo/NNN Per Square Foot
---- ----------- ---------------
1 $80,402.30 $1.10
2 $82,595.09 $1.13
3 $84,787.88 $1.16
4 $87,711.60 $1.20
5 $89,904.39 $1.23
Upon expiration of the original lease terms for 3550, 3570, and 3580 Bassett
Street (June 30, 1999), the new rent, per square foot, will correspond to the
schedule set forth above, so that the rent per square foot is the same each
month for all properties.
4. Operating Expenses - Effective April 1, 1997, Tenant's Share of Direct
Operating Expenses as set forth in and estimated pursuant to Paragraph 6.4 of
the Lease shall increase from one thousand two hundred and no/100's dollars
($1,200.00) to two thousand two hundred and no/100's dollars ($2,200.00).
5. Sublease Rights - Tenant will have the right to sublease the new premises
in accordance with paragraph 15, 15.1 and 15.2 of the original lease. It is
understood that Tenant will have the right to sublease the 3560 Bassett Street
premises solely for the purpose of controlling Tenant's expansion space needs
without Landlord's permission, and without triggering Landlord's termination
rights, providing that any rent received by Tenant that is in excess of
Tenant's rent obligations per square foot hereunder shall be paid to Landlord
by Tenant, after Tenant recovers any costs incurred in subleasing.
6. Option - At the expiration of the term of the Lease on March 31, 2002,
Tenant may extend the term of this Lease for the Premises known as 3550, 3560,
3570, and 3580 Bassett Street for an additional period of sixty (60) months
commencing immediately following the Expiration Date (the "Extended Term").
Tenant shall exercise this option, if at all, by giving Landlord notice of
Tenant's intention to do so at least one hundred eighty (180) days prior to the
Expiration Date. In no event shall any purported exercise of such an option by
Tenant be effective if (i) an Event of Default (as defined in Paragraph 16.1)
exists at the time of such exercise or at the time the Extended Term would
otherwise have commenced, or (ii) more than three (3) Events of Default have
occurred during the Lease term prior to the date the Extended Term would
otherwise have commenced. Unless expressly mentioned and approved in the
written consent of Landlord referred to in Paragraph 15 of this Lease, the
option rights of Tenant under this paragraph are granted for Tenant's personal
benefit and may not be assigned or transferred by Tenant. Such Extended Term
shall be upon all of the terms and conditions hereof, except that the monthly
rental and methods of rental adjustment for the Extended Term shall be
determined as set forth below.
As the commencement of the Extended Term, the monthly Base Rent and the method
of rental adjustment (including the timing of the adjustments and the basis
for calculating the adjustments) for the Extended Term shall be subject to
negotiations between Landlord and Tenant, with an effort to determine a fair
market rental for the Premises, as improved, and a method of rental adjustment
consistent with rental adjustment practices for comparable lease space in the
vicinity of the Premises. In the event the parties fail to agree upon the
amount of the monthly Base Rent and the methods of rental adjustment for the
Extended Term prior to the commencement thereof, the monthly Base Rent and the
method of rental adjustment for the Extended Term shall be determined by
appraisal in the manner hereafter set forth; provided, however, that in no
event shall the monthly Base Rent for the Extended Term be less than the
monthly Base Rent payable hereunder for the last full month of the Lease term
immediately preceding commencement of the Extended Term.
In the event it becomes necessary under this subparagraph to determine the fair
market monthly Base Rent and the method of rental adjustment of the Premises by
appraisal, Landlord and Tenant each shall appoint a real estate appraiser who
shall be a member of the American Institute of Real Estate Appraisers ("AIREA")
and such appraisers
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shall each determine the fair market monthly Base Rent for the Premises, and
the methods of rental adjustments taking into account the value of the premises
and the amenities provided by the Outside Areas, the Building, and prevailing
comparable rentals and rental adjustment practices in the area. Such appraisers
shall, within twenty (20) business days after their appointment, complete their
appraisals and submit their appraisal reports to Landlord and Tenant. If the
fair market monthly Base Rent of the Premises established in the two (2)
appraisals varies by more than five percent (5%) or less of the higher rental,
the average of the two shall be controlling. If said fair market monthly Base
Rent varies by more than five percent (5%) of the higher rental, said
appraisers, within ten (10) days after submission of the last appraisal, shall
appoint a third appraiser who shall be a member of the AIREA and who shall also
be experienced in the appraisal of rental values and adjustment practices for
commercial properties in the vicinity of the Premises. Such third appraiser
shall, within twenty (20) business days after his appointment, determine by
appraisal the fair market monthly Base Rent of the Premises, taking into
account the same factors referred to above, and submit his appraisal report to
Landlord and Tenant. The fair market monthly Base Rent determined by the third
appraiser for the Premises shall be controlling, unless it is less than set
forth in the lower appraisal previously obtained, in which case the value set
forth in said lower appraisal shall be controlling, or unless it is greater
than that set forth in the higher appraisal previously obtained, in which case
the rental set forth in said higher appraisal shall be controlling. The method
of adjusting rental periodically, including the manner and timing of such
adjustments, shall be as determined by the initial two appraisers, if they
agree on a single method; otherwise, it shall be determined by the third
appraiser. If either Landlord or Tenant fails to appoint an appraiser, or if an
appraiser appointed by either of them fails, after his appointment, to submit
his appraisal within the required period in accordance with the forgoing, the
appraisal submitted by the appraiser properly appointed and timely submitting
his appraisal shall be controlling. If the two appraisers appointed by Landlord
and Tenant are unable to agree upon a third appraiser within the required
period in accordance with the forgoing, application shall be made within
twenty (20) days thereafter by either Landlord or Tenant to the AIREA, which
shall appoint a member of said institute willing to serve as appraiser. The
cost of all appraisals under this subparagraph shall be borne equally by
Landlord and Tenant.
7. Parking - Effective April 1, 1997, parking for the Premises, as set forth
in Paragraph 2.1 of the Lease, shall increase from three hundred fifteen (315)
spaces to five hundred sixty seven (567) spaces. One hundred seventy one (171)
spaces are allocated to the Building known as 3550 Bassett Street, Santa Clara,
California, two hundred fifty two (252) spaces are allocated to the Building
known as 3560 Bassett Street, Santa Clara, California, and one hundred
forty four (144) spaces are allocated to the Building known as 3570-3580
Bassett Street, Santa Clara, California.
8. Except as provided herein, all other terms and conditions of the Lease
shall be as previously set forth and are hereby ratified, affirmed, and in full
force and effect.
LANDLORD
KONTRABECKI ASSOCIATES I
By: /s/ J. T. KONTRABECKI
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Its: General Partner Date: March 18, 1997
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TENANT
INTEVAC CORPORATION
By: [SIG]
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Its: Chief Financial Officer Date: March 19, 1997