Exhibit 10.1

 

AGREEMENT OF SALE AND PURCHASE

 

between

 

ATMEL CORPORATION
a Delaware corporation,

 

“Seller,”

 

and

 

ELLIS PARTNERS LLC,
a California limited liability company, as

 

“Buyer”

 

with Escrow Instructions for

 

FIRST AMERICAN TITLE INSURANCE COMPANY,
as Escrow Agent

 

--------------------------------------------------------------------------------

 

TABLE OF CONTENTS

 

 

 

Page

 

 

 

ARTICLE 1

CERTAIN DEFINITIONS

1

 

 

 

Section 1.1.

Definitions

1

Section 1.2

Rules of Construction

5

 

 

 

ARTICLE 2

AGREEMENT OF PURCHASE AND SALE; PURCHASE PRICE

5

 

 

 

Section 2.1

Agreement to Purchase and Sell

5

Section 2.2

Purchase Price

5

Section 2.3

Deposit

5

Section 2.4

Independent Consideration

5

Section 2.5

Indivisible Economic Package

6

 

 

 

ARTICLE 3

BUYER’S DUE DILIGENCE; CONDITION OF THE PROPERTY

6

 

 

 

Section 3.1

Buyer’s Inspections

6

Section 3.2

Delivery Period

6

Section 3.3

Site Visits

6

Section 3.4

Buyer’s Indemnity

6

Section 3.5

Confidentiality

7

 

 

 

ARTICLE 4

TITLE AND SURVEY

8

 

 

 

Section 4.1

Title to Property

8

Section 4.2

Certain Exceptions to Title

8

Section 4.3

Title Insurance

8

 

 

 

ARTICLE 5

REMEDIES AND DEPOSIT INSTRUCTIONS

8

 

 

 

Section 5.1

Permitted Termination; Seller Default

8

Section 5.2

BUYER DEFAULT; LIQUIDATED DAMAGES

9

Section 5.3

Deposit Instructions

10

Section 5.4

Designation of Reporting Person

10

 

 

 

ARTICLE 6

REPRESENTATIONS AND WARRANTIES OF SELLER

11

 

 

 

Section 6.1

Representations and Warranties of Seller

11

Section 6.2

Limited Liability

13

 

 

 

ARTICLE 7

REPRESENTATIONS AND WARRANTIES OF BUYER

13

 

 

 

Section 7.1

Buyer’s Representations and Warranties

13

Section 7.2

Limited Liability

14

Section 7.3

Intentionally Omitted

14

Section 7.4

Buyer’s Independent Investigation

14

Section 7.5

Buyer’s Release of Seller and Seller Indemnitees

16

 

i

--------------------------------------------------------------------------------

 

 

 

Page

 

 

 

Section 7.6

Discharge

17

 

 

 

ARTICLE 8

MAINTENANCE OF PROPERTY

17

 

 

 

Section 8.1

Maintenance and Operation of Property

17

 

 

 

ARTICLE 9

CLOSING AND CONDITIONS

18

 

 

 

Section 9.1

Escrow Instructions

18

Section 9.2

Closing

18

Section 9.3

Seller’s Closing Documents and Other Items

19

Section 9.4

Buyer’s Closing Documents and Other Items

20

Section 9.5

Closing Conditions

20

Section 9.6

Closing Costs and Prorations

21

Section 9.7

Brokers

22

Section 9.8

Expenses

23

 

 

 

ARTICLE 10

MISCELLANEOUS

23

 

 

 

Section 10.1

Amendment and Modification

23

Section 10.2

Risk of Loss/Condemnation and Insurance Proceeds/Condemnation Awards

23

Section 10.3

Notices

24

Section 10.4

Assignment

25

Section 10.5

Governing Law and Consent to Jurisdiction

26

Section 10.6

Counterparts

26

Section 10.7

Entire Agreement

26

Section 10.8

Severability

26

Section 10.9

Attorneys’ Fees

26

Section 10.10

Intentionally Omitted

26

Section 10.11

Confidential Information

26

Section 10.12

Performance Due On Day Other Than Business Day

27

Section 10.13

No Joint Venture

27

Section 10.14

No Memorandum

27

Section 10.15

Waiver of Right to Trial by Jury; Judicial Reference in the Event of Jury Trial
Waiver Unenforceability

27

Section 10.16

Not an Offer

28

Section 10.17

Limited Liability

28

Section 10.18

No Third Party Beneficiaries

28

Section 10.19

Time of Essence

28

Section 10.20

No Waiver

28

Section 10.21

Further Acts

29

Section 10.22

Prohibited Persons and Transactions

29

 

ii

--------------------------------------------------------------------------------

 

EXHIBITS AND SCHEDULES

 

Exhibit A

Legal Description

 

 

Exhibit B

Form of Deed

 

 

Exhibit C

Form of General Assignment

 

 

Exhibit D

Form of Bill of Sale

 

 

Exhibit E

Form of Non-Foreign Status Affidavit

 

 

Exhibit F

List of Environmental and Physical Reports

 

 

Exhibit G

Form of Leaseback Lease

 

 

Exhibit H

Schedule of Excluded Property

 

iii

--------------------------------------------------------------------------------

 

AGREEMENT OF SALE AND PURCHASE

 

THIS AGREEMENT OF SALE AND PURCHASE (this “Agreement”), dated as of August 22,
2011, for reference purposes, is between ATMEL CORPORATION, a Delaware
corporation (“Seller”), and ELLIS PARTNERS LLC, a California limited liability
company (“Buyer”).  This Agreement shall be effective on the “Effective Date,”
which is the date on which the last party required to execute and deliver this
Agreement in order to make it binding on the parties hereto shall have executed
and delivered this Agreement.

 

ARTICLE 1
CERTAIN DEFINITIONS

 

Section 1.1.           Definitions.  The parties hereby agree that the following
initially capitalized terms have the meanings hereinafter set forth, such
definitions to be applicable equally to the singular and plural forms, and to
the masculine and feminine forms, of such terms:

 

“Agreement” is defined in the Preamble.

 

“Appurtenances” means, in each case, to the extent owned by Seller, all rights,
privileges, interests, licenses, claims, easements, benefits, covenants,
conditions and servitudes of any type or nature that are appurtenant to or
otherwise benefiting the Property, including all minerals, oil, gas and other
hydrocarbon substances on and under the Property, as well as all development
rights, air rights, water, water rights and water stock relating to the
Property, and any other easements, rights of way or appurtenances owned by
Seller and used in connection with the beneficial operation, use and enjoyment
of the Property, or any other appurtenance, together with all rights of Seller,
if any, in and to streets, sidewalks, alleys, gores, strips, driveways, parking
areas and areas adjacent thereto or used in connection therewith, and all rights
of Seller, if any, in any Real Property lying in the bed of any existing or
proposed street adjacent to the Property.

 

“Bill of Sale” is defined in Section 9.3(a)(iv).

 

“Business Day” means any day that is not a Saturday, Sunday or any other day on
which banking institutions in the State of California are authorized or
obligated by law or executive order to close.

 

“Buyer” is defined in the Preamble.

 

“Buyer’s Surviving Obligations” means the obligations of Buyer pursuant to
Sections 3.4, 3.5, 7.1, 7.2, 7.4, 7.5, 9.6(d), 9.7, 10.9, 10.11 and 10.15 of
this Agreement, or elsewhere which expressly recite that such obligations
survive the termination of this Agreement or Closing, as applicable.

 

“Closing” is defined in Section 9.2.

 

“Closing Date” is defined in Section 9.

 

--------------------------------------------------------------------------------

 

“Closing Statement” is defined in Section 9.6(d).

 

“Code” is defined in Section 5.4.

 

“Deed” is defined in Section 9.3(a)(i).

 

“Deposit” is defined in Section 2.3.

 

“Effective Date” is defined in the Preamble to this Agreement.

 

“Environmental Laws” means all federal, state and local environmental laws,
rules, statutes, directives, binding written interpretations, binding written
policies, ordinances and regulations issued by any Governmental Entity and in
effect as of the date of this Agreement with respect to or which otherwise
pertain to or affect the Property or any improvements constructed thereon, or
any portion thereof, the use, ownership, occupancy or operation of the Property
or any improvements constructed thereon, or any portion thereof, and as same
have been amended, modified or supplemented from time to time prior to the date
of this Agreement, including the Comprehensive Environmental Response,
Compensation and Liability Act of 1980 (42 U.S.C. § 9601 et seq.), the Hazardous
Substances Transportation Act (49 U.S.C. § 1802 et seq.), the Resource
Conservation and Recovery Act (42 U.S.C. § 6901 et seq.), the Water Pollution
Control Act (33 U.S.C. § 1251 et seq.), the Safe Drinking Water Act (42 U.S.C.
§ 300f et seq.), the Clean Air Act (42 U.S.C. § 7401 et seq.), the Solid Waste
Disposal Act (42 U.S.C. § 6901 et seq.), the Toxic Substances Control Act (15
U.S.C. § 2601 et seq.), the Emergency Planning and Community Right-to-Know Act
of 1986 (42 U.S.C. § 11001 et seq.), the Radon and Indoor Air Quality Research
Act (42 U.S.C. § 7401 note, et seq.), the Superfund Amendment Reauthorization
Act of 1986 (42 U.S.C. § 9601 et seq.), comparable state and local laws, and any
and all rules and regulations which have become effective prior to the date of
this Agreement under any and all of the aforementioned laws.

 

“Environmental Reports” is defined in Section 6.1(i).

 

“Escrow Agent” means the Title Company.

 

“Excluded Property” means the personal property owned by Seller and set forth on
Exhibit H to this Agreement.

 

“General Assignment” is defined in Section 9.3(a)(iii).

 

“Governmental Entity” means the various governmental and quasi-governmental
bodies or agencies having jurisdiction over Seller, the Property or any portion
thereof.

 

“Hazardous Materials” means any pollutants, contaminants, hazardous or toxic
substances, materials or wastes (including petroleum, petroleum by-products,
radon, asbestos and asbestos containing materials, polychlorinated biphenyls
(“PCBs”), PCB-containing equipment, radioactive elements, infectious agents, and
urea formaldehyde), mold, fungus, microbiological pollutants, mildew, bacteria
or organic spore material or related materials), as such terms are used in any
Environmental Laws (excluding solvents, cleaning fluids and other lawful
substances

 

2

--------------------------------------------------------------------------------

 

used in the ordinary operation and maintenance of the Property, to the extent in
closed containers).

 

“Improvements” means all improvements, structures or fixtures constructed upon
the Real Property, including all buildings and structures presently located on
the Real Property, all apparati, equipment and appliances presently located on
the Real Property, as the case may be, owned by Seller and used in connection
with the operation or occupancy thereof.

 

“Independent Consideration” is defined in Section 2.4.

 

“Intangible Personal Property” means, collectively, if any, to the extent owned
by Seller and to the extent assignable, any warranties or guarantees owned by
Seller from any contractors, subcontractors, suppliers or materialmen in
connection with any construction, repairs or alterations of the Improvements,
all licenses, permits, approvals, certificates of occupancy, dedications,
subdivision maps and entitlements now or hereafter issued, approved or granted
by any Governmental Entity in connection with the Property, together with all
renewals and modifications thereof.  Notwithstanding anything to the contrary
contained in this Agreement, Seller shall have no obligation to convey and
assign to Buyer any Intangible Personal Property that is not assignable or may
not be assigned without the consent of a third party or governmental entity, and
Seller shall have no obligation hereunder to solicit or obtain any such consent.

 

“Items” is defined in Section 3.5.

 

“Leaseback Lease” is defined in Section 9.3(a)(v).

 

“Licensee Parties” means those authorized agents, contractors, consultants and
representatives of Buyer who shall inspect, investigate, test or evaluate the
Property on behalf of Buyer in accordance with this Agreement.

 

“Liens” is defined in Section 4.2.

 

“OFAC” is defined in Section 6.1(k).

 

“Permitted Exceptions” means and includes all of the following:  (a) applicable
zoning and building ordinances and Real Property use regulations; (b) the lien
of taxes and assessments not yet delinquent; (c) supplemental assessments
resulting from the transfer of the Property from Seller to Buyer; (d) any
exclusions from coverage set forth in the jacket of an ALTA Owner’s Policy of
Title Insurance (2006, Form B); (e) any exceptions caused by Buyer, its agents,
representatives or employees; (f) local, state and federal laws, ordinances and
governmental regulations, including building and zoning laws, ordinances and
regulations now existing or hereafter in effect with respect to the Property;
(g) water rights, and claims of title to water, whether or not shown by the
public records; (h) the Leaseback Lease; and (i) any matters that are approved
by Buyer in writing or are deemed to be approved by Buyer in accordance with
this Agreement.

 

“Permitted Outside Parties” is defined in Sections 3.5 and 10.11.

 

3

--------------------------------------------------------------------------------

 

“Personal Property” means and includes the Tangible Personal Property, the
Intangible Personal Property and the Plans, but does not include the Excluded
Property, which shall not be transferred, assigned or sold to Buyer.

 

“Plans” means and includes all of Seller’s interest, if any, in any as-built
plans, drawings and specifications for the Improvements and all architectural,
structural, mechanical, electrical and landscaping plans and specifications,
surveys, engineering studies and reports relating to the Property, if any, owned
by Seller and in Seller’s possession or control.

 

“Property” means, collectively, all or any portion of the Real Property, the
Improvements, the Appurtenances and the Personal Property, but does not include
the Excluded Property.

 

“Proration Items” is defined in Section 9.6(d).

 

“Purchase Price” is defined in Section 2.2.

 

“Real Property” means the real property located at 2325 Orchard Parkway
(Assessor Parcel Number 101-03-004), together with adjacent parcels of land
identified as Assessor Parcel Numbers 101-03-008 and 101-003-007, in San Jose,
Santa Clara County, California, as more particularly described on Exhibit A
hereto.

 

“Remaining Cash Amount” is defined in Section 2.2.

 

“Reporting Person” is defined in Section 5.4(a).

 

“R&T Code” is defined in Section 5.4.

 

“Seller” is defined in the Preamble.

 

“Seller Indemnitees” is defined in Section 3.4.

 

“Seller’s Knowledge” is defined in Section 6.1.

 

“Seller’s Surviving Obligations” means the obligations of Seller pursuant to
Sections 6.1, 6.2, 9.5(a)(iv), 9.6(d), 9.7, 10.9, 10.11 and 10.15 of this
Agreement which recite that such obligations survive the termination of this
Agreement, or Closing, as applicable.

 

“Survey” is defined in Section 4.1.

 

“Survey Objections” is defined in Section 9.5(a)(iv).

 

“Tangible Personal Property” means and includes any and all tangible personal
property, if any, located on or about or used in connection with the Property
and owned by Seller.

 

“Title Commitment” is defined in Section 4.1.

 

“Title Company” means First American Title Insurance Company.

 

4

--------------------------------------------------------------------------------

 

“Title Documents” is defined in Section 4.1.

 

“Title Policy” is defined in Section 4.3.

 

Section 1.2            Rules of Construction.  Article and Section captions used
in this Agreement are for convenience only and shall not affect the construction
of this Agreement.  All references to “Article” or “Section” without reference
to a document other than this Agreement, are intended to designate articles and
sections of this Agreement, and the words “herein,” “hereof,” “hereunder” and
other words of similar import refer to this Agreement as a whole and not to any
particular Article or Section, unless specifically designated otherwise.  The
use of the term “including” means in all cases “including, but not limited to,”
unless specifically designated otherwise.  No rules of construction against the
drafter of this Agreement shall apply in any interpretation or enforcement of
this Agreement, any documents or certificates executed pursuant hereto, or any
provisions of any of the foregoing.

 

ARTICLE 2
AGREEMENT OF PURCHASE AND SALE; PURCHASE PRICE

 

Section 2.1            Agreement to Purchase and Sell.  Seller agrees to sell,
transfer and assign to Buyer, and Buyer agrees to purchase and accept, subject
to the terms and conditions stated herein, all of Seller’s right, title and
interest in and to the Property.

 

Section 2.2            Purchase Price.  Buyer shall pay Seller consideration
equal to the sum of FORTY-EIGHT MILLION FIVE HUNDRED THOUSAND AND 00/100THS
DOLLARS ($48,500,000.00) (the “Purchase Price”).  The Purchase Price shall be
payable as follows:  (a) Buyer shall pay the Deposit to Escrow Agent one
Business Day after the Effective Date, and (b) prior to Closing, Buyer shall pay
to the Escrow Agent, in immediately available funds, an amount equal to (i) the
Purchase Price, plus (ii) such other funds as may be necessary to pay Buyer’s
closing expenses hereunder, less (iii) the Deposit (such amount, the “Remaining
Cash Amount”).  The Remaining Cash Amount shall be deposited with Escrow Agent
at least one Business Day before the Closing Date in accordance with this
Agreement and shall be paid to Seller upon the Closing as described herein.

 

Section 2.3            Deposit.  No later than 5:00 pm (Pacific time) on the
date that is one Business Day after the Effective Date, Buyer shall deposit with
Escrow Agent, via wire transfer of immediately available funds as a
non-refundable deposit an amount equal to SEVEN MILLION AND 00/100THS DOLLARS
($7,000,000.00) (the “Deposit “).  Interest earned on the Deposit shall be
considered part of the Deposit, and any party entitled to receive the Deposit
shall also be entitled to receive the interest earned thereon.  The Deposit
shall be non-refundable to Buyer except in the event of Seller’s default, the
failure of a condition precedent to Closing in favor of Buyer to be satisfied or
waived, or as otherwise may be expressly provided in this Agreement.  Except as
otherwise expressly set forth herein, Buyer shall receive credit at Closing for
an amount equal to the Deposit, which shall be applied against the Purchase
Price on the Closing Date.

 

Section 2.4            Independent Consideration.  Contemporaneously with the
execution and delivery of this Agreement, Buyer has paid to Seller as further
consideration for this Agreement,

 

5

--------------------------------------------------------------------------------

 

in cash, the sum of Two Hundred Dollars ($200.00) (the “Independent
Consideration”), in addition to the Deposit and the Purchase Price and
independent of any other consideration provided hereunder, which Independent
Consideration is fully earned by Seller and is non-refundable under any
circumstances, and is not applicable to the Purchase Price.  For the purpose of
clarity, in any circumstance set forth in this Agreement wherein Buyer is
entitled to a refund of the Deposit, such refund will not include the
Independent Consideration.

 

Section 2.5            Indivisible Economic Package.  Buyer has no right to
purchase, and Seller has no obligation to sell, less than all of the Property,
it being the express agreement and understanding of Buyer and Seller that, as a
material inducement to Seller and Buyer to enter into this Agreement, Buyer has
agreed to purchase, and Seller has agreed to sell, all of the Property, subject
to and in accordance with the terms and conditions hereof.

 

ARTICLE 3
BUYER’S DUE DILIGENCE;
CONDITION OF THE PROPERTY

 

Section 3.1            Buyer’s Inspections.  Buyer acknowledges and agrees that
it has completed its due diligence investigations of the Property and has
elected to proceed with the purchase and sale of the Property on the terms set
forth herein.

 

Section 3.2            Delivery Period.  Seller previously has delivered or made
available to Buyer for inspection all files reasonably known by Seller to be in
the possession or control of Seller relating to the ownership, operation,
construction, use or occupancy of the Property, including without limitation the
reports regarding the physical or environmental condition of the Property set
forth in Exhibit F; provided, however, that Seller is not and shall not be
obligated to (i) deliver or make available any internal memoranda or internal
correspondence of Seller, appraisals or financial studies of the Property
prepared by or obtained by Seller, information regarding Seller’s organization
or governing documents or legally privileged documents, (ii) obtain from any
third-party any information not already in Seller’s possession, or (iii) create
any documentation not already in existence.

 

Section 3.3            Site Visits.  Buyer acknowledges that it and its Licensee
Parties previously have been provided access to the Property to conduct such
inspections as Buyer has deemed necessary in connection with its due diligence
investigations of the Property.  Buyer further acknowledges that it and any
Licensee Party has at all times while entering onto the Property maintained
comprehensive general liability (occurrence) insurance with limits of at least
$2,000,000 covering any accident arising in connection with the presence of
Buyer or the other Licensee Parties on the Property.

 

Section 3.4            Buyer’s Indemnity.  Buyer shall defend, indemnify and
hold harmless Seller, Seller’s members, managers, directors, officers,
employees, partners, shareholders and agents (the “Seller Indemnitees”), as
applicable, from and against all losses, costs, damages, claims and liabilities
(whether arising out of injury or death to persons or damage to the Property or
otherwise) including costs of remediation, restoration and other similar
activities, mechanics’ and materialmens’ liens and attorneys’ fees, costs and
expenses, arising out of or in connection with Buyer’s entry onto or
investigations on the Property, Buyer’s breach of its obligations under

 

6

--------------------------------------------------------------------------------

 

Sections 3.5 and 10.11 or Buyer’s or any Licensee Parties’ entry upon the
Property, except to the extent that any of the same are caused by the
intentional acts or omissions of Seller, Seller’s managers, agents, employees,
officers, partners or members, as applicable (provided that any alleged failure
of Seller or any indemnified party to supervise Buyer’s activities shall not
constitute a carve-out to Buyer’s indemnity obligations hereunder).  The
obligations of Buyer under the immediately preceding sentence shall not be
applicable to any existing defective or dangerous condition on or in the
Property (except to the extent exacerbated by Buyer or any Licensee Party) or to
the mere discovery by Buyer of any Hazardous Materials, in, on, under or near
the Property.  The provisions of this Section 3.4 shall survive the Closing or,
if the purchase and sale is not consummated, any termination of this Agreement.

 

Section 3.5            Confidentiality.  Buyer agrees that any information
obtained by Buyer or its attorneys, Licensee Parties, partners, prospective
partners, members, investors and prospective investors, accountants,
consultants, prospective lenders, investment advisors or any person or entity
who directly or indirectly through one or more intermediaries, controls, is
controlled by or is under common control with, Buyer (collectively, for purposes
of this Section 3.5, the “Permitted Outside Parties”) in the conduct of its due
diligence investigations of the Property shall be treated as confidential
pursuant to Section 10.11 of this Agreement, and shall be used only to evaluate
the acquisition of the Property from Seller.  Buyer further agrees that within
its organization, or as to the Permitted Outside Parties, all materials to which
Seller has provided Buyer access (the “Items”) will be disclosed and exhibited
prior to Closing only to those persons within Buyer’s organization or to those
Permitted Outside Parties who are responsible for:  (a) determining the
feasibility or financing of Buyer’s acquisition of the Property, or (b) acting
in an asset management role with respect to the Property following the Closing
(assuming that the Closing occurs).  Buyer further acknowledges that the Items
are proprietary and confidential in nature.  Buyer agrees not to divulge the
contents of such Items or any other information except in strict accordance with
this Section 3.5 and Section 10.11 of this Agreement.  In permitting Buyer and
the Permitted Outside Parties to review the Items and other information to
assist Buyer, Seller has not waived any privilege or claim of confidentiality
with respect thereto, and no third party benefits or relationships of any kind,
either express or implied, have been offered, intended or created by Seller and
any such claims are expressly rejected by Seller and waived by Buyer and the
Permitted Outside Parties, for whom, by its execution of this Agreement, Buyer
is acting as an agent with regard to such waiver.  Without limiting the
generality of any other provision of this Agreement, Buyer agrees that it shall,
within five Business Days following the termination of this Agreement for any
reason, as part of the consideration owing to Seller, deliver and return to
Seller copies of all materials relating to the Property as Buyer may have
received from Seller or any agent of Seller.  Following the Closing, each of
Buyer and Seller shall have the right to discuss and disclose the transaction
contemplated by this Agreement; provided, however, that any such disclosure
shall be mutually approved by Buyer and Seller (except where such disclosure is
compelled by law); and provided, further, that Seller shall not disclose the
Purchase Price or other economic terms of the transaction.  The provisions of
this Section 3.5 shall survive the termination of this Agreement.

 

7

--------------------------------------------------------------------------------

 

ARTICLE 4
TITLE AND SURVEY

 

Section 4.1            Title to Property.  Buyer previously has obtained:  (a) a
preliminary title report with respect to the Property issued by the Title
Company (the “Title Commitment”), and (b) copies of all recorded documents
referred to on Schedule B of the Title Commitment as exceptions to coverage (the
“Title Documents”).  Buyer also has ordered an updated or new survey, Buyer may
do so at Buyer’s sole cost and expense (the “Survey”).

 

Section 4.2            Certain Exceptions to Title.  Buyer acknowledges that it
previously has had the right to object in writing to any title matters that are
not Permitted Exceptions that are disclosed in the Title Commitment, Title
Documents or the Survey (herein collectively called “Liens”) and is satisfied
that the Title Company is prepared to issue to Buyer the Title Policy, defined
below.

 

Notwithstanding any other provision hereof, Seller shall be obligated to remove
any voluntary monetary liens at Closing and, as set forth in Section 8.1, in no
event shall voluntarily permit the recording of a new lien or encumbrance on the
Property after the Effective Date.

 

Section 4.3            Title Insurance.  Buyer shall be solely responsible to
obtain the commitment of the Title Company to issue to Buyer at Closing an ALTA
2006 Owner’s Policy (with extended coverage) of title insurance dated the date
and time of Closing in the amount of the Purchase Price, insuring that fee
simple to the Property is vested in Buyer, subject only to the Permitted
Exceptions and containing such endorsements as Buyer shall request and Title
Company shall agree to issue (the “Title Policy”).

 

ARTICLE 5
REMEDIES AND DEPOSIT INSTRUCTIONS

 

Section 5.1            Permitted Termination; Seller Default; Exclusive Remedy.

 

(a)           If Seller materially breaches a material representation or
warranty prior to Closing or otherwise fails to comply with a material
pre-Closing covenant (other than the failure to sell the Property to Buyer (the
remedies for which are described in subsection (b) below)), Buyer shall have the
right, as its sole remedies, either to (i) terminate this Agreement by giving
written notice to Seller and receive the return of the Deposit, which return
shall operate to release Seller from any and all liability hereunder; except
that Seller shall be obligated to reimburse Buyer for its out of pocket due
diligence costs and attorneys’ fees incurred in connection with this Agreement,
up to a cap of $100,000.00, or (ii) proceed with this Agreement and close on the
acquisition of the Property, in which event Buyer shall be deemed to have waived
any and all claims arising out of the breach of the representation and warranty
or the covenant breach, as applicable.

 

(b)           If the sale of the Property is not consummated due to Seller’s
default hereunder, then Buyer shall be entitled, as its sole and exclusive
remedy, either to: (i) terminate this Agreement by giving written notice to
Seller and receive the return of the Deposit, which return shall operate to
release Seller from any and all liability hereunder except that Seller shall be
obligated to reimburse Buyer for its out of pocket due diligence costs and
attorneys’ fees

 

8

--------------------------------------------------------------------------------

 

incurred in connection with this Agreement, up to a cap of $100,000.00, or
(ii) enforce specific performance of this Agreement.  Except as expressly set
forth above, Buyer irrevocably and expressly waives its rights to seek any
damages in the event of Seller’s default hereunder.  Buyer shall be deemed to
have elected to terminate this Agreement and receive back the Deposit if Buyer
fails to file suit for specific performance against Seller in a court prescribed
by Section 10.5 hereof, on or before 60 days after the date when the Closing was
to have occurred (subject to any extensions for the Closing as expressly
provided in this Agreement).  TO THE MAXIMUM EXTENT NOW OR HEREAFTER PERMITTED
BY APPLICABLE LAW, THE FOREGOING REMEDY CONSTITUTES SELLER’S EXCLUSIVE LIABILITY
AND OBLIGATION, AND BUYER’S EXCLUSIVE REMEDY FOR ANY BREACH OF THIS AGREEMENT,
REGARDLESS OF WHETHER BUYER’S ACTION OR CLAIM IS BASED ON CONTRACT, TORT OR
OTHERWISE.  SELLER WILL IN NO EVENT BE LIABLE TO BUYER FOR
CONSEQUENTIAL, INCIDENTAL, INDIRECT, EXEMPLARY OR SPECIAL DAMAGES OR FOR LOST
PROFITS OR LOSS OF BUSINESS, WHETHER IN AN ACTION BASED ON CONTRACT, TORT OR ANY
OTHER LEGAL THEORY, ARISING FROM OR RELATED TO THE PURCHASE CONTEMPLATED
HEREUNDER, EVEN IF SELLER IS APPRISED OF OR SHOULD HAVE KNOWN THE LIKELIHOOD OF
SUCH DAMAGES OCCURRING.

 

Section 5.2            BUYER DEFAULT; LIQUIDATED DAMAGES.  IF THE SALE IS NOT
CONSUMMATED DUE TO ANY REASON OTHER THAN EITHER (x) THE PERMITTED TERMINATION OF
THIS AGREEMENT BY BUYER AS HEREIN EXPRESSLY PROVIDED OR (y) IF ANY OF THE
CONDITIONS PRECEDENT SET FORTH IN SECTION 9.5(a) ARE NOT FULFILLED OR WAIVED BY
BUYER, IN WRITING, SUBJECT TO THE TERMS AND PROVISIONS OF SECTION 9.5(a), THEN
SELLER SHALL RETAIN THE DEPOSIT AS LIQUIDATED DAMAGES, WHICH RETENTION SHALL
OPERATE TO TERMINATE THIS AGREEMENT AND RELEASE BUYER FROM ANY AND ALL LIABILITY
HEREUNDER, EXCEPT FOR BUYER’S SURVIVING OBLIGATIONS.  THE PARTIES HAVE AGREED
THAT SELLER’S ACTUAL DAMAGES, IN THE EVENT OF A FAILURE TO CONSUMMATE THIS SALE
FOR SUCH REASONS, WOULD BE EXTREMELY DIFFICULT OR IMPRACTICABLE TO DETERMINE. 
AFTER NEGOTIATION, THE PARTIES HAVE AGREED THAT, CONSIDERING ALL THE
CIRCUMSTANCES EXISTING ON THE DATE OF THIS AGREEMENT, THE AMOUNT OF THE DEPOSIT
IS A REASONABLE ESTIMATE OF THE DAMAGES THAT SELLER WOULD INCUR IN SUCH EVENT,
AND SELLER HEREBY WAIVES ITS RIGHT TO SPECIFIC PERFORMANCE AGAINST BUYER.  BY
PLACING THEIR INITIALS BELOW, EACH PARTY SPECIFICALLY CONFIRMS THE ACCURACY OF
THE STATEMENTS MADE ABOVE AND THE FACT THAT EACH PARTY WAS REPRESENTED BY
COUNSEL WHO EXPLAINED, AT THE TIME THIS AGREEMENT WAS MADE, THE CONSEQUENCES OF
THIS LIQUIDATED DAMAGES PROVISION.  THE FOREGOING IS NOT INTENDED TO LIMIT
BUYER’S SURVIVING OBLIGATIONS.

 

Initials:                   Seller WL               Buyer JE

 

9

--------------------------------------------------------------------------------

 

Section 5.3            Deposit Instructions.  The Escrow Agent joins herein
below to evidence its agreement to hold such funds in accordance with the terms
and conditions of this Agreement.  Further, the following provisions shall
control with respect to the rights, duties and liabilities of the Escrow Agent. 
The Escrow Agent acts hereunder as a depository only and is not responsible or
liable in any manner whatsoever for the (a) sufficiency, correctness,
genuineness or validity of any written instrument, notice or evidence of a
party’s receipt of any instruction or notice which is received by the Escrow
Agent, or (b) identity or authority of any person executing such instruction
notice or evidence.  The Escrow Agent shall have no responsibility hereunder
except for the performance by it in good faith of the acts to be performed by it
hereunder, and the Escrow Agent shall have no liability except for its own
willful misconduct or gross negligence.  In the event of a dispute between the
parties hereto with respect to the disposition of the Deposit and all other
amounts held in escrow, the Escrow Agent shall be entitled, at its own
discretion, to deliver such amount to an appropriate court of law pending
resolution of the dispute.  The Escrow Agent shall invest the amount in escrow
in accounts which are federally insured, maintained at a financial institution
approved by Seller and Buyer, invested solely in United States Treasury
Securities or other government securities which are satisfactory to Seller and
Buyer, and applied in accordance with the terms of this Agreement.

 

Section 5.4            Designation of Reporting Person.  To assure compliance
with the requirements of Section 6045 of the Internal Revenue Code of 1986, as
amended (the “Code”), and any related reporting requirements of the Code and the
California Revenue and Taxation Code (for purposes of this Section 5.4, the “R&T
Code”), the parties hereto agree as follows:

 

(a)           Provided that the Escrow Agent executes a counterpart of this
Agreement, which shall evidence Escrow Agent’s agreement to assume all
responsibilities for information reporting required under Section 6045(e) of the
Code and the R&T Code, Seller and Buyer shall designate the Escrow Agent as the
person to be responsible for all information reporting under Section 6045(e) of
the Code (the “Reporting Person”) and the R&T Code.  If the Escrow Agent refuses
to execute a counterpart of this Agreement pursuant to which it agrees to be the
Reporting Person, Seller and Buyer shall agree to appoint another third party as
the Reporting Person.

 

(b)           Seller and Buyer hereby agree:

 

(i)            to provide to the Reporting Person all information and
certifications regarding such party, as reasonably requested by the Reporting
Person or otherwise required to be provided by a party to the transaction
described herein under Section 6045 of the Code; and

 

(ii)           to provide to the Reporting Person such party’s taxpayer
identification number and a statement (on Internal Revenue Service Form W-9 or
an acceptable substitute form, or on any other form the applicable current or
future Code sections and regulations might require and/or any form requested by
the Reporting Person), signed under penalty of perjury, stating that the
taxpayer identification number supplied by such party to the Reporting Person is
correct.

 

10

--------------------------------------------------------------------------------

 

(c)           Each party hereto agrees to retain this Agreement for not less
than four years from the end of the calendar year in which the Closing occurred,
and to produce it to the Internal Revenue Service upon a valid request therefor.

 

ARTICLE 6
REPRESENTATIONS AND WARRANTIES OF SELLER

 

Section 6.1            Representations and Warranties of Seller.  Subject to the
provisions of Section 6.2, Seller makes the following (and no other)
representations and warranties with respect to the Property as of the Effective
Date:

 

(a)           Status.  Seller is a corporation organized, validly existing and
in good standing under the laws of the State of Delaware and is qualified to
transact business in the State of California.

 

(b)           Authority.  The execution and delivery of this Agreement and the
performance of Seller’s obligations hereunder have been or will be duly
authorized by all necessary corporate action on the part of Seller, and this
Agreement constitutes the legal, valid and binding obligation of Seller, subject
to equitable principles and principles governing creditors’ rights generally.

 

(c)           No Conflict.

 

(i)            The execution and delivery by Seller of this Agreement and the
performance by Seller of its obligations hereunder will not (A) violate or
constitute an event of default under the terms or provisions of any agreement,
document or other instrument to which Seller is a party or by which it or the
Property is bound, (B) violate any provision of any legal requirement to which
Seller or the Property is subject and (C) violate any judgment, order, writ,
injunction or decree of any court applicable to Seller or the Property.

 

(ii)           No consent, authorization, license, permit, registration or
approval of, or exemption or other action by, any governmental or public body,
commission or authority is required in connection with the execution, delivery
and performance by Seller of this Agreement.

 

(iii)          There are no proceedings at law or in equity before any court,
grand jury, administrative agency or other investigative body, or governmental
department, commission, board, agency, bureau or instrumentality of any kind
pending or, to Seller’s knowledge, threatened against or affecting Seller or the
Property that (A) involve the validity or enforceability of this Agreement or
any other instrument or document to be delivered by Seller pursuant hereto, or
(B) relate specifically to the Property or the title thereto.

 

(iv)          Any permission, approval, joinder or consent by third parties
required in order for Seller to consummate its obligations under this Agreement
has been received.

 

(d)           Non-Foreign Entity.  Seller is not a “foreign person” or “foreign
corporation” as those terms are defined in the Code, and the regulations
promulgated thereunder.

 

11

--------------------------------------------------------------------------------

 

(e)           Bankruptcy.  Seller has not (i) commenced a voluntary case, or had
entered against it a petition, for relief under any federal bankruptcy act or
any similar petition, order or decree under any federal or state law or statute
relative to bankruptcy, insolvency or other relief for debtors; (ii) caused,
suffered or consented to the appointment of a receiver, trustee, administrator,
conservator, liquidator or similar official in any federal, state or foreign
judicial or non-judicial proceedings, to hold, administer or liquidate all or
substantially all of its property; or (iii) made an assignment for the benefit
of creditors.

 

(f)            Leases.  Except for the Leaseback Lease to be entered into as of
Closing, Seller has not entered into any written or oral lease, license or
occupancy agreement, and Seller has not given any person any right of possession
to the Property or any portion thereof.

 

(g)           Condemnation.  Seller has received no written notice and has no
actual knowledge of any pending or threatened proceedings in eminent domain or
otherwise, which would affect the Property, or any material portion thereof.

 

(h)           No Violations.  Seller has not received any written notices that
the Property or any portion thereof violates any law, regulation or other
governmental rule applicable to the Property, which violation has not previously
been cured.

 

(i)            Environmental.  Exhibit F sets forth all environmental reports in
the possession of Seller (the “Environmental Reports”), and Seller has delivered
true, correct and complete copies of the Environmental Reports to the extent in
the possession of Seller.  To Seller’s actual knowledge, except as disclosed in
the Environmental Reports, Seller has received no written notices that there are
any Hazardous Materials at, in or under the Real Property (provided, however,
that the foregoing shall not include commercially reasonable amounts of such
materials used in the ordinary course of operation of the Property which are
used and stored in accordance with all applicable Environmental Laws), and
Seller has received no written notices of any violations of any Environmental
Laws affecting the Real Property that remain uncured.

 

(j)            Due Diligence Materials.  To Seller’s knowledge, the files and
documentation delivered or made available to Buyer pursuant to Section 3.2 of
this Agreement, including the reports listed on Exhibit F hereto, constitute all
written materials in Seller’s possession regarding the Property, excluding such
internal documents described in Section 3.2 that are not being made available to
Buyer.

 

(k)           OFAC.  Seller is in compliance with all applicable anti-money
laundering and anti-terrorist laws, regulations, rules, executive orders and
government guidance, including the reporting, record keeping and compliance
requirements of the Bank Secrecy Act, as amended by The International Money
Laundering Abatement and Financial Anti-Terrorism Act of 2001, Title III of the
USA PATRIOT Act, and other authorizing statutes, executive orders and
regulations administered by the US Department of the Treasury’s Office of
Foreign Assets Control (“OFAC”), and related Securities and Exchange Commission,
self-regulatory organization or other agency rules and regulations.

 

12

--------------------------------------------------------------------------------

 

The term “Seller’s knowledge” or words of similar import mean the actual
knowledge of Seller’s Director of Facilities, as of the Effective Date or as of
the Closing Date, as applicable, whom Seller represents and warrants is the
person in Seller’s organization who is primarily responsible for the
development, management, leasing and operation of the Property, without any duty
of inquiry or investigation.

 

Section 6.2            Limited Liability.  The representations and warranties of
Seller set forth in Section 6.1 will survive the Closing for a period of twelve
months.  If specifically asserted in writing prior to the expiration of such
twelve-month period, a claim for indemnification shall thereafter survive until
resolved by mutual agreement between Buyer and Seller or by judicial
determination.  Any claim for indemnification not so asserted with specificity
in writing prior to the expiration of such twelve-month period shall not
thereafter be asserted and shall forever be waived.  If, prior to the Closing,
Buyer has or obtains actual knowledge of any material breach of a representation
or warranty of Seller herein (from whatever source as a result of Buyer’s due
diligence or written disclosure by Seller or Seller’s agents and employees) that
contradicts any of Seller’s material representations and warranties herein, then
Buyer may terminate this Agreement upon written notice to Seller (and upon such
termination shall be entitled to a return of the Deposit) if Seller is unable or
unwilling to cure such material breach within 10 days after notice from Buyer
regarding such alleged breach of a representation or warranty.  Seller shall
have no liability (under this Section 6.2 or otherwise) to Buyer with respect to
any of Seller’s representations and warranties herein if, prior to the Closing,
Buyer has or obtains actual knowledge (from whatever source as a result of
Buyer’s due diligence or written disclosure by Seller or Seller’s agents and
employees) that contradicts any of Seller’s representations and warranties
herein and Buyer nevertheless consummates the transaction contemplated by this
Agreement.  All other representations, warranties, covenants and agreements made
or undertaken by Seller under this Agreement, except for Buyer’s Surviving
Obligations and Seller’s Surviving Obligations, unless otherwise specifically
provided herein, will not survive the Closing Date but will be merged into the
Deed and the other Closing documents delivered at the Closing.

 

ARTICLE 7
REPRESENTATIONS AND WARRANTIES OF BUYER

 

Section 7.1            Buyer’s Representations and Warranties.  Buyer represents
and warrants to Seller the following:

 

(a)           Status.  Buyer is a limited liability company, duly organized and
validly existing and in good standing under the laws of the state of its
formation and is qualified to do business and in good standing in the State of
California.

 

(b)           Authority.  The execution and delivery of this Agreement and the
performance of Buyer’s obligations hereunder have been or will be duly
authorized by all necessary action on the part of Buyer and this Agreement
constitutes the legal, valid and binding obligation of Buyer, subject to
equitable principles and principles governing creditors’ rights generally.

 

(c)           Non-Contravention.  To Buyer’s knowledge, the execution and
delivery of this Agreement by Buyer and the consummation by Buyer of the
transactions contemplated

 

13

--------------------------------------------------------------------------------

 

hereby will not violate any judgment, order, injunction, decree, regulation or
ruling of any court or Governmental Entity or conflict with, result in a breach
of, or constitute a default under the organizational documents of Buyer, any
note or other evidence of indebtedness, any mortgage, deed of trust or
indenture, or any lease or other material agreement or instrument to which Buyer
is a party or by which it is bound.

 

(d)           Consents.  No consent, waiver, approval or authorization is
required from any person or entity (that has not already been obtained) in
connection with the execution and delivery of this Agreement by Buyer or the
performance by Buyer of the transactions contemplated hereby.

 

(e)           Bankruptcy. Buyer has not (i) commenced a voluntary case, or had
entered against it a petition, for relief under any federal bankruptcy act or
any similar petition, order or decree under any federal or state law or statute
relative to bankruptcy, insolvency or other relief for debtors, (ii) caused,
suffered or consented to the appointment of a receiver, trustee, administrator,
conservator, liquidator or similar official in any federal, state or foreign
judicial or non-judicial proceeding, to hold, administer and/or liquidate all or
substantially all of its property, or (iii) made an assignment for the benefit
of creditors.

 

(f)            OFAC.  Buyer is in compliance with all applicable anti-money
laundering and anti-terrorist laws, regulations, rules, executive orders and
government guidance, including the reporting, record keeping and compliance
requirements of the Bank Secrecy Act, as amended by The International Money
Laundering Abatement and Financial Anti-Terrorism Act of 2001, Title III of the
USA PATRIOT Act, and other authorizing statutes, executive orders and
regulations administered by OFAC, and related Securities and Exchange
Commission, self-regulatory organization or other agency rules and regulations.

 

(g)           Principal; Financial Resources.  Buyer is acting as a principal in
connection with the transaction contemplated by this Agreement.

 

Section 7.2            Limited Liability.  The representations and warranties of
Buyer set forth in Section 7.1 will survive the Closing for a period of twelve
months.  If specifically asserted in writing prior to the expiration of such
twelve-month period, a claim for indemnification shall thereafter survive until
resolved by mutual agreement between Buyer and Seller or by judicial
determination.  Any claim for indemnification not so asserted with specificity
in writing prior to the expiration of such twelve-month period shall not
thereafter be asserted and shall forever be waived.

 

Section 7.3            Intentionally Omitted.

 

Section 7.4            Buyer’s Independent Investigation.  Buyer has been given,
either independently or through agents of Buyer’s choosing, an opportunity to
review all material matters regarding the Property, including:

 

(a)           All matters relating to title, leasehold interests, together with
all governmental and other legal requirements such as taxes, assessments,
zoning, use permit requirements and building codes;

 

14

--------------------------------------------------------------------------------

 

(b)           The Improvements, physical condition and aspects of the Property,
including all physical and functional aspects of the Property (including
Hazardous Materials), performed or arranged by Buyer at Buyer’s sole expense;

 

(c)           Any easements and access rights affecting the Property;

 

(d)           All Intangible Property, the Plans and any other documents or
agreements of significance affecting the Property; and

 

(e)           All other matters of material significance affecting the Property,
or which Buyer otherwise reasonably considers to be relevant to the acquisition
of the Property.

 

THE TRANSACTION CONTEMPLATED BY THIS AGREEMENT HAS BEEN NEGOTIATED BETWEEN
SELLER AND BUYER, THIS AGREEMENT REFLECTS THE MUTUAL AGREEMENT OF SELLER AND
BUYER, AND AS OF THE CLOSING HEREUNDER BUYER HAS CONDUCTED ITS OWN INDEPENDENT
EXAMINATION OF THE PROPERTY.  EXCEPT AS EXPRESSLY PROVIDED HEREIN, BUYER HAS NOT
RELIED UPON AND WILL NOT RELY UPON, EITHER DIRECTLY OR INDIRECTLY, ANY
REPRESENTATION OR WARRANTY OF SELLER OR ANY OF SELLER’S AGENTS OR
REPRESENTATIVES, AND BUYER HEREBY ACKNOWLEDGES THAT NO SUCH REPRESENTATIONS HAVE
BEEN MADE.  SELLER SPECIFICALLY DISCLAIMS, AND NEITHER IT NOR ANY OTHER PERSON
IS MAKING, ANY REPRESENTATION, WARRANTY OR ASSURANCE WHATSOEVER TO BUYER AND NO
WARRANTIES OR REPRESENTATIONS OF ANY KIND OR CHARACTER, EITHER EXPRESS OR
IMPLIED, ARE MADE BY SELLER OR RELIED UPON BY BUYER WITH RESPECT TO THE STATUS
OF TITLE TO OR THE MAINTENANCE, REPAIR, CONDITION, DESIGN OR MARKETABILITY OF
THE PROPERTY, OR ANY PORTION THEREOF, INCLUDING (i) ANY IMPLIED OR EXPRESS
WARRANTY OF MERCHANTABILITY, (ii) ANY IMPLIED OR EXPRESS WARRANTY OF FITNESS FOR
A PARTICULAR PURPOSE, (iii) ANY IMPLIED OR EXPRESS WARRANTY OF CONFORMITY TO
MODELS OR SAMPLES OF MATERIALS, (iv) ANY RIGHTS OF BUYER UNDER APPROPRIATE
STATUTES TO CLAIM DIMINUTION OF CONSIDERATION, (v) ANY CLAIM BY BUYER FOR
DAMAGES BECAUSE OF DEFECTS, WHETHER KNOWN OR UNKNOWN, LATENT OR PATENT, WITH
RESPECT TO THE PROPERTY, (vi) THE FINANCIAL CONDITION OR PROSPECTS OF THE
PROPERTY, AND (vii) THE COMPLIANCE OR LACK THEREOF OF THE PROPERTY WITH
GOVERNMENTAL REGULATIONS, IT BEING THE EXPRESS INTENTION OF SELLER AND BUYER
THAT, EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT, THE PROPERTY WILL BE
CONVEYED AND TRANSFERRED TO BUYER IN ITS PRESENT CONDITION AND STATE OF REPAIR,
“AS IS” AND “WHERE IS”, WITH ALL FAULTS.  Buyer represents that it is relying
solely on its own due diligence investigations and expertise and that of Buyer’s
consultants in purchasing the Property.  Buyer acknowledges and agrees that it
has had the opportunity to conduct such inspections, investigations and other
independent examinations of the Property and related matters, including the
physical and environmental conditions thereof, and will rely solely upon same
and not upon any

 

15

--------------------------------------------------------------------------------

 

statements of Seller or of any member, manager, officer, director, agent or
attorney of Seller.  Buyer acknowledges that all information obtained by Buyer
has been obtained from a variety of sources and Seller will not be deemed to
have represented or warranted the completeness, adequacy, truth or accuracy of
any information heretofore or hereafter furnished to Buyer.  Upon Closing, Buyer
will assume the risk that adverse matters, including adverse physical and
environmental conditions, may not have been revealed by Buyer’s inspections and
investigations (subject to the express representations and warranties of Buyer
hereunder).  Buyer acknowledges and agrees that upon Closing, Seller will sell
and convey to Buyer, and Buyer will accept the Property, “AS IS, WHERE IS,” with
all faults.  Buyer further acknowledges and agrees that there are no oral
agreements, warranties or representations, collateral to or affecting the
Property, by Seller, any agent of Seller or any third party other than the
representations and warranties expressly set forth in this Agreement.  Seller is
not liable or bound in any manner by any oral or written statements,
representations or information pertaining to the Property furnished by any real
estate broker, agent, employee, servant or other person, unless the same are
specifically set forth or referred to herein.  Buyer acknowledges that the
Purchase Price reflects the “as is, where is” nature of this sale and any
faults, liabilities, defects or other adverse matters that may be associated
with the Property.  BUYER, WITH BUYER’S COUNSEL, HAS FULLY REVIEWED THE
DISCLAIMERS AND WAIVERS SET FORTH IN THIS AGREEMENT, AND UNDERSTANDS THE
SIGNIFICANCE AND EFFECT THEREOF.  BUYER ACKNOWLEDGES AND AGREES THAT THE
DISCLAIMERS AND OTHER AGREEMENTS SET FORTH HEREIN ARE AN INTEGRAL PART OF THIS
AGREEMENT, AND THAT SELLER WOULD NOT HAVE AGREED TO SELL THE PROPERTY TO BUYER
FOR THE PURCHASE PRICE WITHOUT THE DISCLAIMER AND OTHER AGREEMENTS SET FORTH IN
THIS AGREEMENT.  THE TERMS AND CONDITIONS OF THIS SECTION 7.4 WILL EXPRESSLY
SURVIVE THE CLOSING, WILL NOT MERGE WITH THE PROVISIONS OF ANY CLOSING DOCUMENTS
AND WILL BE INCORPORATED INTO THE DEED.

 

JE

Buyer’s Initials

 

Section 7.5            Buyer’s Release of Seller and Seller Indemnitees.

 

(a)           Seller Released From Liability.  As of the Closing, each of Seller
and the Seller Indemnitees are hereby released from all responsibility and
liability to Buyer regarding the condition (including the presence in the soil,
air, structures and surface and subsurface waters, of Hazardous Materials or
substances that have been or may in the future be determined to be toxic,
hazardous, undesirable or subject to regulation and that may need to be
specially treated, handled or removed from the Property under current or future
federal, state and local laws, regulations or guidelines), valuation, salability
or utility of the Property, or its suitability for any purpose whatsoever. 
Buyer acknowledges that as of the Closing it shall have inspected the Property,
observed its physical characteristics and existing conditions and had the
opportunity to conduct such investigation and study on and of said Property and
adjacent areas as it deemed necessary, and hereby waives any and all objections
to or complaints (including actions based on federal, state or common law and
any private right of action under CERCLA, RCRA or any other state

 

16

--------------------------------------------------------------------------------

 

and federal law to which the Property is or may be subject) regarding physical
characteristics and existing conditions, including structural and geologic
conditions, subsurface soil and water conditions and solid and hazardous waste
and Hazardous Materials on, under, adjacent to or otherwise affecting the
Property.  In that connection, Buyer, on behalf of itself, its successors,
assigns and successors-in-interest and such other persons and entities, waives
the benefit of California Civil Code Section 1542, which provides as follows:

 

“A general release does not extend to claims which the creditor does not know or
suspect to exist in his favor at the time of executing the release, which if
known by him must have materially affected his settlement with the debtor.”

 

Buyer further hereby assumes the risk of changes in applicable laws and
regulations relating to past, present and future environmental conditions on the
Property, and the risk that adverse physical characteristics and conditions,
including the presence of Hazardous Materials or other contaminants, may not be
revealed by its investigation.

 

The foregoing release, however, shall not apply to (i) any claims arising out of
the Leaseback Lease, (ii) claims arising out of any breach of any covenants or
representations and warranties on the part of Seller hereunder, (iii) claims
arising out of any fraud on the part of Seller, and (iv) Buyer rights of
indemnity or contribution arising out of third party claims relating to acts or
omission occurring prior to the Closing.

 

Buyer’s Initials:  JE

 

(b)           Survival.  The foregoing waivers and releases by Buyer shall
survive either (i) the Closing and the recordation of the Deed, and shall not be
deemed merged into the Deed upon its recordation, or (ii) any termination of
this Agreement.

 

Section 7.6            Discharge.  Notwithstanding any other provisions to the
contrary contained herein, or in any document or instrument delivered in
connection with the transfer contemplated hereby (including any language
providing for survival of certain provisions hereof or thereof), Buyer hereby
acknowledges and agrees that (a) prior to Closing, Buyer’s sole recourse in the
event of a breach by Seller shall be as set forth in Sections 5.1 hereof, and
(b) Seller shall, upon consummation of Closing, be deemed to have fully
satisfied and fulfilled all of Seller’s covenants, indemnities and obligations
contained in this Agreement and the documents delivered pursuant hereto, and
Seller shall have no further liability to Buyer or otherwise with respect to
this Agreement, the transfers contemplated hereby, or any documents delivered
pursuant hereto, except as may be specifically set forth herein or in the
Leaseback Lease.

 

ARTICLE 8
MAINTENANCE OF PROPERTY

 

Section 8.1            Maintenance and Operation of Property.  From the date
hereof until the Closing, and except as otherwise consented to or approved by
Buyer, Seller covenants and agrees that Seller will continue to maintain the
Property in the ordinary course of Seller’s business and

 

17

--------------------------------------------------------------------------------

 

substantially in accordance with Seller’s present practice, as of the Effective
Date, subject to ordinary wear and tear and further subject to Section 10.2. 
From and after the Effective Date and prior to the Closing hereunder (or earlier
termination of this Agreement in accordance with the terms of this Agreement),
Seller shall not, without the prior written consent of Buyer which will not be
unreasonably withheld, enter into any new lease or contract or agreement for the
provision of materials, goods or services to or with respect to the Property
unless such contract is terminable as of or before the Closing Date (and is
terminated by Seller), create any encumbrance or lien upon the Property, or
originate or cause any assessments to be charged against the Property, that will
not be removed from the title to the Property by Seller on or before the
Closing.  Seller shall terminate all existing contracts or agreements for the
provision of materials, goods or services to or with respect to the Property (to
the extent terminable by their terms) as of the later of the Closing or the
termination of the Leaseback Lease.

 

ARTICLE 9
CLOSING AND CONDITIONS

 

Section 9.1            Escrow Instructions.  Upon execution of this Agreement,
the parties hereto shall deposit an executed counterpart of this Agreement with
the Title Company, and this Agreement shall serve as escrow instructions to the
Title Company as the Escrow Holder for consummation of the purchase and sale
contemplated hereby.  Seller and Buyer agree to execute such reasonable
additional and supplementary escrow instructions as may be appropriate to enable
the Title Company to comply with the terms of this Agreement; provided, however,
that if there is any conflict between the provisions of this Agreement and any
supplementary escrow instructions, the terms of this Agreement shall control.

 

Section 9.2            Closing.  The closing hereunder (the “Closing”) shall be
held, and delivery of all items to be made at the Closing under the terms of
this Agreement shall be made through escrow at Escrow Agent’s office, on the
date that is five (5) Business Days following the Effective Date (the “Closing
Date”); provided, however, that the Closing Date shall not take place on a
Monday or a Tuesday if the immediately prior Monday is not a Business Day (and
the Closing Date shall be extended to the next applicable Business Day as
necessary to accommodate this requirement).  No later than 11:00 am (Pacific
Time) on the Closing Date (or such later time on the Closing Date if a “special”
recording is available and authorized by both Seller and Buyer), provided the
Deed has been recorded, (a) Buyer will cause the Escrow Agent to (i) pay to
Seller by Federal Reserve wire transfer of immediately available funds to an
account designated by Seller, the Purchase Price (subject to adjustments
described in Section 9.6), less any costs or other amounts to be paid by Seller
at Closing pursuant to the terms of this Agreement, and (ii) pay all appropriate
payees the other costs and amounts to be paid by Buyer at Closing pursuant to
the terms of this Agreement; and (b) Seller will direct the Escrow Agent to pay
to the appropriate payees out of the proceeds of Closing payable to Seller, all
costs and amounts to be paid by Seller at Closing pursuant to the terms of this
Agreement.

 

18

--------------------------------------------------------------------------------

 

Section 9.3            Seller’s Closing Documents and Other Items.

 

(a)           At least one Business Day before Closing, Seller shall deposit
into escrow the following items:

 

(i)            A duly executed and acknowledged Grant Deed for the Property, in
the form attached hereto as Exhibit B (the “Deed”), which shall contain a
separate completed and signed real estate transfer tax declaration for the
Property;

 

(ii)           An affidavit in the form of Exhibit E attached hereto, pursuant
to Section l445(b)(2) of the Code, and on which Buyer is entitled to rely, that
Seller is not a “foreign person” within the meaning of Section l445(f)(3) of the
Code, together with a California 593 Certificate pursuant to the corresponding
provisions of the R&T Code;

 

(iii)          At least four duly executed counterparts of the General
Assignment in the form attached hereto as Exhibit C (the “General Assignment”);

 

(iv)          At least four duly executed counterparts of the Bill of Sale in
the form attached hereto as Exhibit D (the “Bill of Sale”);

 

(v)           At least four duly executed counterparts of the Lease in the form
attached hereto as Exhibit G (the “Leaseback Lease”), pursuant to which Buyer
shall lease to Seller and Seller shall lease from Buyer the Real Property for
the term described therein;

 

(vi)          A date down certificate affirming the continued accuracy of the
representations and warranties of Seller set forth in Section 6.1 as of the
Closing Date;

 

(vii)         Insurance certificates confirming the existence and primary terms
of the insurance policies to be obtained by Seller as the tenant under
Section 9.1 of the Leaseback Lease;

 

(viii)        A resolution and incumbency certificate of Seller to establish to
Title Company’s reasonable satisfaction the due authority of Seller’s sale of
the Property and Seller’s delivery of the documents required to be delivered by
Seller pursuant to this Agreement; and

 

(ix)           Such other documents as may be reasonably required by the Title
Company, including a commercially reasonable owner’s affidavit necessary to
enable the Title Company to issue the Title Policy in accordance with the terms
of this Agreement (on the Title Company’s standard form, or otherwise agreed to
between Seller and Title Company) to consummate the purchase of the Property as
contemplated by this Agreement.

 

(b)           Upon the Closing, Seller shall deliver to Buyer the keys to the
Property to the extent in Seller’s possession.

 

19

--------------------------------------------------------------------------------

 

Section 9.4            Buyer’s Closing Documents and Other Items.  Buyer shall
deposit (or cause to be deposited) into escrow the following items:

 

(a)           In accordance with the time periods specified in Section 9.2
above, the balance of the Purchase Price and such additional funds as are
necessary to close this transaction;

 

(b)           At least one Business Day before Closing, at least four
counterparts of each of the General Assignment, the Bill of Sale and the
Leaseback Lease duly executed by Buyer;

 

(c)           At least one Business Day before Closing, a resolution and
incumbency certificate of Buyer to establish to Title Company’s reasonable
satisfaction the due authority of Buyer’s acquisition of the Property and
Buyer’s delivery of the documents and funds required to be delivered and paid by
Buyer pursuant to this Agreement; and

 

(d)           Prior to Closing, such other documents as may be reasonably
required by the Title Company or as may be agreed upon by Seller and Buyer to
consummate the purchase of the Property as contemplated by this Agreement.

 

Section 9.5            Closing Conditions.

 

(a)           Buyer’s obligation to purchase the Property is conditioned upon
satisfaction of the following:

 

(i)            Seller’s delivery to escrow of the documents and items specified
in Section 9.3, above;

 

(ii)           Seller shall have performed in all material respects all of its
covenants in this Agreement;

 

(iii)          Each of Seller’s representations and warranties set forth herein
(as they may be deemed modified pursuant to the terms hereof) shall be true and
correct in all material respects as of the date made and as of the Closing Date;

 

(iv)          That certain Grant of Easement from Seller to the San Jose Water
Company referenced in and attached to Buyer’s survey objections dated August 17,
2011 (“Survey Objections”), shall have been recorded and the Title Company shall
be prepared to issue a 103.3 or 103.6 endorsement with respect to the easement
as part of the Title Policy.  In the event that the San Jose Water Company
required the issuance of the title insurance referenced in the Survey
Objections, such issuance shall not be a condition to Closing, but Seller shall
cooperate fully with Buyer and Title Company with respect thereto and, between
Buyer and Seller, Seller shall bear any costs related to such issuance (and the
provisions of this sentence shall survive Closing); and

 

(v)           Issuance by the Title Company of the Title Policy containing only
Permitted Exceptions.

 

20

--------------------------------------------------------------------------------

 

If the conditions described in Section 9.5(a) above are not satisfied (or waived
in writing by Buyer) prior to the Closing, then Buyer shall be entitled either
to terminate this Agreement and receive the full return of the Deposit unless
the failure of a condition to be satisfied also constitutes a breach of a
covenant or representation and warranty on the part of Seller, in which event
the provisions of Section 5.1 shall apply.  If a condition to Closing is not
satisfied, then Buyer shall not terminate this Agreement or exercise any other
remedy without giving Seller notice of the failure of such condition, and a
reasonable opportunity to cause such condition to be satisfied, not to exceed 10
Business Days.

 

(b)           Seller’s obligation to sell the Property is conditioned upon the
satisfaction of the following:

 

(i)            Buyer shall have performed in all material respects all of its
covenants in this Agreement;

 

(ii)           Each of Buyer’s representations and warranties set forth herein
(as they may be deemed modified pursuant to the terms hereof) shall be true and
correct in all material respects as of the date made and as of the Closing Date;
and

 

(iii)          Buyer’s delivery to escrow of the funds, documents and items
specified in Section 9.4, above.

 

If any of the conditions described in Section 9.5(b) above, are not satisfied
(or waived in writing by Seller) prior to the Closing, then, Seller shall be
entitled to terminate this Agreement upon written notice to Buyer.

 

Section 9.6            Closing Costs and Prorations.

 

(a)          Seller shall pay (i) 100% of the costs of transfer taxes imposed by
Santa Clara County and 50% of the costs of transfer taxes imposed by the City of
San Jose in connection with the transfer of the Property; (ii) 100% of the
Escrow Agent’s escrow fee; (iii) the premium for the CLTA portion of the Title
Policy; and (iv) any additional costs and charges customarily charged to sellers
of real property in accordance with common escrow practices in Santa Clara
County, California, other than those costs and charges specifically required to
be paid by Buyer hereunder.

 

(b)           Buyer shall pay:  (i) 50% of the costs of transfer taxes imposed
by the City of San Jose in connection with the transfer of the Property;
(ii) the premium for the ALTA portion of the Title Policy and the costs of any
endorsements Buyer may require and all costs of re-insurance and co-insurance;
and (iii) any additional costs and charges customarily charged to buyers in
accordance with common escrow practices in Santa Clara County, California, other
than those costs and charges specifically required to be paid by Seller
hereunder.  In addition to the foregoing, Buyer shall be solely responsible for
any costs incurred in connection with Buyer’s due diligence investigations of
the Property, including physical inspections, survey updates and costs and
expenses incurred in connection with any financing desired to be obtained by
Buyer.

 

21

--------------------------------------------------------------------------------

 

(c)           Each party shall pay for the costs of their respective counsel in
connection with the Closing.

 

(d)           Seller and Buyer agree to adjust, as of 11:59 pm (Pacific Time) on
the day immediately preceding the Closing Date, all revenue and expenses
relating to the Property (the “Proration Items”) including real estate taxes and
assessments (including any adjustments to real estate taxes and assessments and
refunds of any payments thereof that are made following the Closing but relate
to periods of time prior to Closing, which obligation will survive the
Closing).  Notwithstanding the foregoing, the parties acknowledge that, pursuant
to the Leaseback Lease, Seller shall continue to be responsible for real estate
taxes and operating expenses for the Property solely for and during the term of
the Leaseback Lease and, accordingly, real estate taxes and operating expenses
shall not be prorated under this Agreement at Closing.  Seller will be charged
and credited for the amounts of all of the Proration Items relating to the
period up to and including 11:59 pm (Pacific Time) on the day immediately
preceding the Closing Date, and Buyer will be charged and credited for all of
the Proration Items relating to the period after the Closing Date.  The
preliminary estimated Closing prorations shall be set forth on a preliminary
closing statement to be prepared by the Title Company and submitted to Buyer for
Buyer’s reasonable approval at least two Business Days prior to the Closing Date
(the “Closing Statement”).  Notwithstanding the foregoing, Buyer acknowledges
that Seller is pursuing a personal and real property tax reduction with respect
to the Property dating back to tax year 2009, and Buyer agrees that any refund
issued in connection therewith, regardless of the date issued or the party to
whom such refund is issued, shall be the property of Seller.

 

For purposes of calculating prorations, Buyer shall be deemed to hold title to
the Property and be entitled to the income therefrom and responsible for the
expenses thereof for the entire day upon which the Closing occurs.  All such
prorations shall be made on the basis of the actual number of days of the month
that shall have elapsed as of the day of the Closing and based upon the actual
number of days in the month and a 365-day year.  Such prorations shall be
initially performed by Seller and Buyer pursuant to the Closing Statement, but
shall be subject to adjustment in cash after the Closing outside of escrow as
and when complete and accurate information becomes available, if such
information is not available at the Closing provided that Seller and Buyer shall
cooperate to make such adjustments no later than 60 days after the Closing.

 

Section 9.7            Brokers.  Seller hereby represents and warrants to Buyer
that, other than Cornish & Carey Commercial (the fee or commission for whom
shall be paid by Seller pursuant to a separate agreement), it did not employ or
use any broker or finder to arrange or bring about this transaction, and that
there are no other claims or rights for brokerage commissions or finder’s fees
in connection with the transactions contemplated by this Agreement.  Buyer
hereby represents and warrants to Seller that it did not employ or use any
broker or finder to arrange or bring about this transaction, and that there are
no other claims or rights for brokerage commissions or finder’s fees in
connection with the transactions contemplated by this Agreement.  If any person
brings a claim against Seller or any Seller Indemnitee for a commission or
finder’s fee based upon any contact, dealings or communication with Buyer in
connection with the transactions contemplated by this Agreement, then Buyer
shall defend Seller

 

22

--------------------------------------------------------------------------------

 

and the Seller Indemnitees from such claim, and shall indemnify Seller and the
Seller Indemnitees and hold Seller and the Seller Indemnitees harmless from any
and all costs, damages, claims, liabilities or expenses (including reasonable
attorneys’ fees and disbursements) incurred by Seller or any Seller Indemnitee
with respect to the claim.  If any person brings a claim against Buyer for a
commission or finder’s fee based upon any contact, dealings or communication
with Seller in connection with the transactions contemplated by this Agreement,
then Seller shall defend Buyer from such claim, and shall indemnify Buyer and
hold Buyer harmless from any and all costs, damages, claims, liabilities or
expenses (including reasonable attorneys’ fees and disbursements) incurred by
Buyer with respect to the claim.  The provisions of this Section 9.7 shall
survive the Closing.

 

Section 9.8            Expenses.  Except as provided in Section 9.6 or
Section 9.7, each party hereto shall pay its own expenses incurred in connection
with this Agreement and the transactions contemplated hereby, including in the
case of Buyer, all third-party engineering and environmental review costs
incurred by or on behalf of Buyer, its inspection costs, attorney costs and due
diligence costs.

 

ARTICLE 10
MISCELLANEOUS

 

Section 10.1         Amendment and Modification.  This Agreement may be amended,
modified or supplemented only by a written agreement signed by Buyer and Seller.

 

Section 10.2         Risk of Loss/Condemnation and Insurance
Proceeds/Condemnation Awards.

 

(a)           Minor Loss/Condemnation.  Buyer shall be bound to purchase the
Property for the full Purchase Price as required by the terms hereof, without
regard to the occurrence or effect of any damage to the Property or condemnation
of any portion of the Property, provided that:  (i) the cost to repair any such
damage or destruction, or the diminution in the value of the remaining Property
as a result of a partial condemnation, equals five percent or less of the
Purchase Price, (ii) any such damage, destruction or condemnation does not
impair access to the Property, and (iii) upon the Closing, there shall be a
credit against the Purchase Price due hereunder equal to the amount of any
insurance proceeds or condemnation awards collected by Seller as a result of any
such damage, destruction or condemnation, plus the amount of any uninsured loss
and insurance deductible, less any sums reasonably expended by Seller toward the
restoration or repair of the Property, including barricades and other temporary
repairs required for safety purposes, or in collecting such insurance proceeds
or condemnation awards.  If the proceeds or awards have not been collected as of
the Closing, then such proceeds or awards shall be assigned to Buyer, except to
the extent needed to reimburse Seller for sums expended prior to the Closing to
repair or restore the Property or to collect any such proceeds or awards.

 

(b)           Major Loss/Condemnation.  If the amount of the damage, destruction
or condemnation as specified above exceeds five percent of the Purchase Price or
such damage or destruction is not covered by insurance maintained by Seller or
any damage, destruction or condemnation impairs access to the Property, then
Buyer may at its option, to be exercised by

 

23

--------------------------------------------------------------------------------

 

written notice to Seller within 10 Business Days after Seller’s notice to Buyer
of the occurrence of the damage or destruction or the commencement of
condemnation proceedings, terminate this Agreement or proceed with the purchase
and sale transaction in accordance with the terms of this Agreement.  Buyer’s
failure to elect to terminate this Agreement or proceed with the purchase and
sale transaction in accordance with the terms of this Agreement within said
10-Business Day period shall be deemed an election by Buyer to terminate this
Agreement.  If Buyer elects to or is deemed to have elected to terminate this
Agreement within such 10-Business Day period, the Deposit shall be returned to
Buyer and neither party shall have any further rights or obligations hereunder
except for Buyer’s Surviving Obligations and Seller’s Surviving Obligations.  If
Buyer elects to proceed with the purchase, then upon the Closing, there shall be
a credit against the Purchase Price due hereunder equal to the amount of any
uninsured loss and insurance proceeds or condemnation awards collected by Seller
as a result of any such damage or destruction or condemnation, plus the amount
of any insurance deductible, less any sums reasonably expended by Seller toward
the restoration or repair of the Property, including barricades and other
temporary repairs required for safety purposes, or in collecting such insurance
proceeds or condemnation awards.  If the proceeds or awards have not been
collected as of the Closing, then such proceeds or awards shall be assigned to
Buyer, except to the extent needed to reimburse Seller for sums expended prior
to the Closing to repair or restore the Property, including barricades and other
temporary repairs required for safety purposes, or to collect any such proceeds
or awards.

 

Section 10.3         Notices.  All notices required or permitted hereunder shall
be in writing and shall be served on the Parties at the following address:

 

If to Seller:

Atmel Corporation

 

2325 Orchard Parkway

 

San Jose, California 95131

 

Attn: John Pfeifer, Real Estate and Facilities Manager

 

Facsimile: (408) 487-2517

 

Email: john.pfeifer@atmel.com

 

 

with a copy to:

Atmel Corporation

 

2325 Orchard Parkway

 

San Jose, California 95131

 

Attn: Chief Legal Officer Legal Department

 

Facsimile: (408) 386-4111

 

Email: Legal@atmel.com

 

 

with an additional copy to:

Gibson, Dunn & Crutcher LLP

 

555 Mission St., Ste. 3000

 

San Francisco, California 94105

 

Attn: Fred L. Pillon

 

Facsimile: (415) 986-5309

 

Email: fpillon@gibsondunn.com

 

 

If to Buyer:

Ellis Partners LLC

 

111 Sutter Street, Suite 800

 

24

--------------------------------------------------------------------------------

 

 

San Francisco, CA 94104

 

Attention: Melinda Ellis Evers

 

Facsimile: 415-391-4711

 

Email: melinda@ellispartners.com

 

 

with a copy to:

Stein & Lubin LLP

 

600 Montgomery Street, 14th Floor

 

San Francisco, CA 94111

 

Attention: Richard B. Caine

 

Facsimile: 415-981-4343

 

Email: rcaine@steinlubin.com

 

 

If to Escrow Agent:

First American Title Insurance Company

 

100 Spear Street, Suite 1600

 

San Francisco, CA 94105

 

Attention: Kimberleigh Toci

 

Facsimile: 415-398-1750

 

Email: ktoci@firstam.com

 

Any such notices may be sent by (a) certified mail, return receipt requested, in
which case notice shall be deemed delivered three Business Days after deposit,
postage prepaid in the US mail, (b) a recognized and reputable overnight
courier, in which case notice shall be deemed delivered one Business Day after
deposit with such courier (on or prior to 6:00 pm Pacific Time; if deposited
after such time, it shall be deemed to have been deposited on the next Business
Day), (c) facsimile transmission, in which case notice shall be deemed delivered
upon electronic verification (on or prior to 6:00 pm Pacific Time; if
verification is received after such time, it shall be deemed to have been
delivered on the next Business Day) that transmission to recipient was
completed, or (d) electronic mail, in which case notice shall be deemed
delivered when the addressee acknowledges receipt.  The above addresses and
facsimile numbers may be changed by written notice to the other party; provided
that no notice of a change of address or facsimile number shall be effective
until actual receipt of such notice.

 

Section 10.4         Assignment.  Buyer shall not have the right to assign this
Agreement, whether voluntarily or by operation of law (including any form of
change of control, merger or business reorganization), without the prior written
consent of Seller, which consent may be granted or withheld in Seller’s sole and
absolute discretion; provided, however, that Seller consent to an assignment of
this Agreement by Buyer shall not be required if the assignee (a) agrees to be
bound by all of the terms and conditions of this Agreement, and (b) is a
business entity controlled and/or managed by, or under common control with,
Buyer (provided that any such affiliate assignment must be completed and Buyer
must give Seller written notice of such assignment not less than three
(3) Business Days prior to Closing).  Notwithstanding any assignment permitted
by Seller, Buyer shall not be released from its obligations under this Agreement
upon such assignment.  This Agreement will be binding upon and inure to the
benefit of Seller and Buyer and their respective permitted successors and
assigns, and no other party will be conferred any rights by virtue of this
Agreement or be entitled to enforce any of the provisions hereof.  Whenever a
reference is made in this Agreement to Seller or Purchaser, such reference will
include the successors and permitted assigns of such party under this Agreement.

 

25

--------------------------------------------------------------------------------

 

Section 10.5         Governing Law and Consent to Jurisdiction.  THIS AGREEMENT
SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF
CALIFORNIA, WITHOUT REGARD TO ANY OTHERWISE APPLICABLE PRINCIPLES OF CONFLICTS
OF LAWS.  ANY ACTION ARISING OUT OF THIS AGREEMENT MUST BE COMMENCED BY BUYER OR
SELLER IN THE STATE COURTS OF THE STATE OF CALIFORNIA, COUNTY OF SANTA CLARA, OR
IN US FEDERAL COURT FOR THE NORTHERN DISTRICT OF CALIFORNIA AND EACH PARTY
HEREBY CONSENTS TO THE JURISDICTION OF THE ABOVE COURTS IN ANY SUCH ACTION AND
TO THE LAYING OF VENUE IN THE STATE OF CALIFORNIA, COUNTY OF SANTA CLARA.

 

Section 10.6         Counterparts.  This Agreement may be executed in two or
more fully or partially executed counterparts, any one or more of which may be
executed and delivered by facsimile transmission, each of which will be deemed
an original binding the signer thereof against the other signing parties, but
all counterparts together will constitute one and the same instrument.

 

Section 10.7         Entire Agreement.  This Agreement and any other document to
be furnished pursuant to the provisions hereof embody the entire agreement and
understanding of the parties hereto as to the subject matter contained herein. 
There are no restrictions, promises, representations, warranties, covenants or
undertakings other than those expressly set forth or referred to in such
documents.  This Agreement and such documents supersede all prior agreements and
understandings among the parties with respect to the subject matter hereof.

 

Section 10.8         Severability.  Any term or provision of this Agreement that
is invalid or unenforceable in any jurisdiction will, as to such jurisdiction,
be ineffective to the extent of such invalidity or unenforceability without
rendering invalid or unenforceable the remaining terms and provisions of this
Agreement, or affecting the validity or enforceability of any of the terms or
provisions of this Agreement.

 

Section 10.9         Attorneys’ Fees.  If any action is brought by any party to
this Agreement to enforce or interpret its terms or provisions, the prevailing
party will be entitled to reasonable attorneys’ fees, expenses, court costs and
other costs incurred in connection with such action prior to and at trial and on
any appeal therefrom.  The provisions of this Section 10.9 shall survive the
Closing or termination of this Agreement.

 

Section 10.10           Intentionally Omitted.

 

Section 10.11           Confidential Information.  The parties acknowledge that
the transaction described herein, including the existence of the discussions
relating to the proposed transaction, and all information delivered to or made
available to Buyer, its attorneys, Licensee Parties, partners, prospective
partners, members, investors and prospective investors, accountants,
consultants, prospective lenders, investment advisors, or any person or entity
who directly, or indirectly through one or more intermediaries, controls, is
controlled by or is under common control with, Buyer (collectively, for purposes
of this Section 10.11, the “Permitted Outside Parties”), is of a confidential
nature and shall not be disclosed to any person, except to Permitted Outside
Parties as permitted by this Agreement, or as expressly required by law

 

26

--------------------------------------------------------------------------------

 

(including, without limitation, in connection with any disclosure or filing
pursuant to federal securities law).  No party shall make any public disclosure
of the specific terms of this Agreement or of the discussions of the parties
hereto regarding the proposed transaction contemplated by this Agreement, except
as expressly required by law, whether during the term of this Agreement or
following the termination of this Agreement for any reason whatsoever.  In
connection with the negotiation of this Agreement and the preparation for the
consummation of the transactions contemplated hereby, each party acknowledges
that it will have access to confidential information relating to the other
party.  Each party shall treat such information as confidential, preserve the
confidentiality thereof, and not duplicate or use such information, except as to
Permitted Outside Parties in connection with the transactions contemplated
hereby.  If this Agreement terminates for any reason whatsoever, each party
shall keep confidential and not use any such information except as otherwise
expressly permitted herein and as otherwise required by law, and shall instruct
all Permitted Outside Parties who have had access to such information, regarding
the confidential nature of this transaction and the provisions herein regarding
confidentiality.  The provisions of this Section 10.11 shall survive the Closing
or termination of this Agreement.

 

Section 10.12           Performance Due On Day Other Than Business Day.  If the
time period for the performance of any act called for under this Agreement
expires on a day other than a Business Day, then the act in question may be
performed on the next succeeding Business Day.

 

Section 10.13           No Joint Venture.  Nothing set forth in this Agreement
shall be construed to create a joint venture between Buyer and Seller.

 

Section 10.14       No Memorandum.  Buyer shall not record any memorandum
disclosing this Agreement.

 

Section 10.15           Waiver of Right to Trial by Jury; Judicial Reference in
the Event of Jury Trial Waiver Unenforceability.  EACH PARTY TO THIS AGREEMENT
HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION
OR CAUSE OF ACTION (a) ARISING UNDER OR RELATED IN ANY WAY TO THIS AGREEMENT OR
ANY OTHER INSTRUMENT, DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED IN CONNECTION
HEREWITH, OR (b) IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE
DEALINGS OF THE PARTIES HERETO OR ANY OF THEM WITH RESPECT TO THIS AGREEMENT OR
ANY OTHER INSTRUMENT, DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED IN CONNECTION
HEREWITH, OR THE TRANSACTIONS RELATED HERETO OR THERETO, IN EACH CASE WHETHER
NOW EXISTING OR HEREAFTER ARISING, AND WHETHER SOUNDING IN CONTRACT OR TORT OR
OTHERWISE; AND EACH PARTY HEREBY AGREES AND CONSENTS THAT ANY SUCH CLAIM,
DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT A
JURY.  NOTWITHSTANDING THE FOREGOING TO THE CONTRARY, IF THE JURY TRIAL WAIVER
CONTAINED HEREIN SHALL BE HELD OR DEEMED TO BE UNENFORCEABLE, EACH PARTY HERETO
HEREBY EXPRESSLY AGREES TO SUBMIT TO JUDICIAL REFERENCE PURSUANT TO CALIFORNIA
CODE OF CIVIL PROCEDURE SECTIONS 638 THROUGH 645.1 ANY CLAIM, DEMAND, ACTION OR
CAUSE OF ACTION ARISING HEREUNDER FOR WHICH A JURY TRIAL WOULD

 

27

--------------------------------------------------------------------------------

 

OTHERWISE BE APPLICABLE OR AVAILABLE.  PURSUANT TO SUCH JUDICIAL REFERENCE, THE
PARTIES AGREE TO THE APPOINTMENT OF A SINGLE REFEREE AND SHALL USE THEIR BEST
EFFORTS TO AGREE ON THE SELECTION OF A REFEREE.  IF THE PARTIES ARE UNABLE TO
AGREE ON A SINGLE REFEREE, A REFEREE SHALL BE APPOINTED BY THE COURT UNDER
CALIFORNIA CODE OF CIVIL PROCEDURE SECTIONS 638 AND 640 TO HEAR ANY DISPUTES
HEREUNDER IN LIEU OF ANY SUCH JURY TRIAL.  EACH PARTY ACKNOWLEDGES AND AGREES
THAT THE APPOINTED REFEREE SHALL HAVE THE POWER TO DECIDE ALL ISSUES IN THE
APPLICABLE ACTION OR PROCEEDING, WHETHER OF FACT OR LAW, AND SHALL REPORT A
STATEMENT OF DECISION THEREON; PROVIDED, HOWEVER, THAT ANY MATTERS WHICH WOULD
NOT OTHERWISE BE THE SUBJECT OF A JURY TRIAL WILL BE UNAFFECTED BY THIS WAIVER
AND THE AGREEMENTS CONTAINED HEREIN.  THE PARTIES HERETO HEREBY AGREE THAT THE
PROVISIONS CONTAINED HEREIN HAVE BEEN FAIRLY NEGOTIATED ON AN ARMS-LENGTH BASIS,
WITH BOTH SIDES AGREEING TO THE SAME KNOWINGLY AND BEING AFFORDED THE
OPPORTUNITY TO HAVE THEIR RESPECTIVE LEGAL COUNSEL CONSENT TO THE MATTERS
CONTAINED HEREIN.  ANY PARTY TO THIS AGREEMENT MAY FILE AN ORIGINAL
COUNTERPART OR A COPY OF THIS SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE
CONSENT OF THE PARTIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY AND
THE AGREEMENTS CONTAINED HEREIN REGARDING THE APPLICATION OF JUDICIAL REFERENCE
IN THE EVENT OF THE INVALIDITY OF SUCH JURY TRIAL WAIVER.  The provisions of
this Section 10.15 shall survive the Closing or termination of this Agreement.

 

Section 10.16           Not an Offer.  Presentation of drafts hereof by one
party to the other shall not be deemed an offer, and this Agreement shall only
become a binding and enforceable contract upon execution hereof by both parties.

 

Section 10.17           Limited Liability.  Neither the members, managers,
employees or agents of Seller, nor the shareholders, officers, directors,
employees or agents of any of them shall be liable under this Agreement (except
and solely to the extent of their actual receipt of proceeds of the sale of the
Property pursuant hereto) and all parties hereto shall look solely to the assets
of Seller for the payment of any claim or the performance of any obligation by
Seller.  None of the individual members, managers, employees or agents or Buyer,
nor the shareholders, officers, directors, partners, members, employees or
agents of any of them shall be liable under this Agreement.

 

Section 10.18       No Third Party Beneficiaries.  Nothing in this Agreement is
intended to benefit any third party, or create any third party beneficiary.

 

Section 10.19       Time of Essence.  Time is of the essence in Buyer’s
performance of this Agreement.  Unless otherwise expressly provided in this
Agreement, Seller shall not be obligated to extend any deadline for Buyer
performance or other time limit set out in this Agreement.

 

Section 10.20       No Waiver.  No waiver of any of the provisions of this
Agreement shall be deemed, or shall constitute, a waiver of any other provision,
whether or not similar, nor shall any waiver constitute a continuing waiver, nor
shall a waiver in any instance constitute a waiver

 

28

--------------------------------------------------------------------------------

 

in any subsequent instance.  No waiver shall be binding unless executed in
writing by the party making the waiver.

 

Section 10.21           Further Acts.  Each party, at the request of the other,
shall execute, acknowledge or have notarized (if appropriate) and deliver in a
timely manner such additional documents, and do such other additional acts, also
in a timely manner, as may be reasonably required in order to accomplish the
intent and purposes of this Agreement.

 

Section 10.22           Prohibited Persons and Transactions.  Neither Buyer nor
any of its affiliates, nor any of their respective partners, members,
shareholders or other equity owners, and none of their respective employees,
officers, directors, representatives or agents is, nor will they become, a
person or entity with whom United States persons or entities are restricted from
doing business under regulations of the OFAC of the Department of the Treasury
(including those named on OFAC’s Specially Designated and Blocked Persons List)
or under any statute, executive order (including the September 24, 2001,
Executive Order Blocking Property and Prohibiting Transactions with Persons Who
Commit, Threaten to Commit, or Support Terrorism), or other governmental action
and is not and will not engage in any dealings or transactions or be otherwise
associated with such persons or entities.

 

[SIGNATURES FOLLOW ON NEXT PAGE]

 

29

--------------------------------------------------------------------------------

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed as of the day and year first above written.

 

 

“SELLER”:

 

 

 

 

ATMEL CORPORATION, a Delaware corporation

 

 

 

By:

/s/ W. Lifsey

 

Name:

Walter Lifsey

 

Its:

Chief Operating Officer

 

 

 

 

By:

 

 

Name:

 

 

Its:

 

 

 

 

 

 

 

 

“BUYER”:

 

 

 

ELLIS PARTNERS LLC, a California limited liability company

 

 

 

 

By:

/s/ James F. Ellis

 

Name:

James F. Ellis

 

Its:

Managing Member

 

[SIGNATURE PAGE TO ORCHARD PARKWAY PURCHASE AND SALE AGREEMENT]

 

--------------------------------------------------------------------------------

 

ACKNOWLEDGMENT OF ESCROW AGENT

 

The Escrow Agent is executing this Agreement to evidence its agreement to hold
the Deposit and act as “Escrow Agent” in accordance with the terms and
conditions of this Agreement and the “Reporting Person” in accordance with
Section 5.4 of this Agreement.

 

 

ESCROW AGENT:

 

 

 

 

 

 

FIRST AMERICAN TITLE
INSURANCE COMPANY

 

 

 

 

By:

/s/ Barbara A. Brennan

 

 

Name:

Barbara A. Brennan

 

 

Title:

Senior Escrow Officer

 

[SIGNATURE PAGE TO ORCHARD PARKWAY PURCHASE AND SALE AGREEMENT]

 

--------------------------------------------------------------------------------

 

ASSIGNMENT OF PURCHASE AND SALE AGREEMENT

 

This ASSIGNMENT OF PURCHASE AND SALE AGREEMENT is entered into as of August 23,
2011, by and between ELLIS PARTNERS LLC, a California limited liability company
(“Assignor”) and BEP ORCHARD INVESTORS LLC, a Delaware limited liability company
(“Assignee”).

 

Assignor hereby assigns to Assignee all of Assignor’s rights, title and interest
in and to that certain Agreement of Sale and Purchase dated August 22, 2011,
between Assignor, as Buyer, and Atmel Corporation, a Delaware corporation, as
Seller (the “Agreement”), relating to real property with a street address of
2325 Orchard Parkway in the City of San Jose, County of Santa Clara, California,
adjacent unimproved real property, and related assets, all as more particularly
described therein.

 

Assignee hereby accepts said assignment and agrees to be bound by, and to assume
and timely perform Assignor’s obligations under, the Agreement.

 

Assignor and Assignee represent that this Assignment does not require Seller
consent pursuant to Section 10.4 of the Agreement.

 

1

--------------------------------------------------------------------------------

 

IN WITNESS WHEREOF, Assignor and Assignee have executed this Assignment
effective as of the date first set forth above.

 

ASSIGNOR:

 

ASSIGNEE:

 

 

 

ELLIS PARTNERS LLC,

 

BEP ORCHARD INVESTORS LLC,

a California limited liability company

 

a Delaware limited liability company

 

 

 

By:

/s/ Melinda Ellis Evers

 

By:

BEP Investors I LLC,

Name:

Melinda Ellis Evers

 

 

a Delaware limited liability company

Title:

Managing Principal

 

 

Its Sole Member

 

 

 

 

 

 

 

 

 

By:

EPL BP I LLC,

 

 

 

 

 

a California limited liability company

 

 

 

 

 

Its Manager

 

 

 

 

 

 

 

 

 

 

 

By:

Ellis Partners LLC,

 

 

 

 

 

 

a California limited liability company

 

 

 

 

 

 

Its Manager

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

By:

/s/ Melinda Ellis Evers

 

 

 

 

 

 

Name:

Melinda Ellis Evers

 

 

 

 

 

 

Title:

Managing Member

 

2

--------------------------------------------------------------------------------