Exhibit 10.98

 

 

AGREEMENT OF SALE

 

 

by and between

 

 

2975 STENDER ASSOCIATES LLC,

 

as Seller

 

and

 

CATALYST SEMICONDUCTOR, INC.,

 

as Buyer

 

 

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TABLE OF CONTENTS

 

 

 

Page

 

 

 

1.

Sale and Purchase

1

 

 

 

2.

Certain Fundamental Terms; Payment of Purchase Price

1

 

 

 

3.

Closing

3

 

 

 

4.

Condition of Title

3

 

 

 

5.

Assignment of Existing Agreements.

5

 

 

 

6.

Apportionments.

5

 

 

 

7.

Closing Costs.

7

 

 

 

8.

Municipal Improvements/Notices.

7

 

 

 

9.

Seller’s Representations and Covenants.

8

 

 

 

10.

Delivery of Premises Documents

11

 

 

 

11.

Buyer Representations

11

 

 

 

12.

Conditions Precedent to Closing

12

 

 

 

13.

Deliveries at Closing

12

 

 

 

14.

Default.

13

 

 

 

15.

Notices; Computation of Periods

15

 

 

 

16.

Fire or Other Casualty

17

 

 

 

17.

Condemnation

18

 

 

 

18.

Assignability

18

 

 

 

19.

Inspections/Inspection Period

19

 

 

 

20. [a06-4657_1ex10d98.htm#a20_Brokers_SellerAndBuyerEachRep_085309]

Brokers [a06-4657_1ex10d98.htm#a20_Brokers_SellerAndBuyerEachRep_085309]

20

 

 

 

21. [a06-4657_1ex10d98.htm#a21_ConditionOfPremises_aNoWarran_085313]

CONDITION OF PREMISES
[a06-4657_1ex10d98.htm#a21_ConditionOfPremises_aNoWarran_085313]

20

 

 

 

22. [a06-4657_1ex10d98.htm#a22_SurvivalOfProvisions__085320]

Survival of Provisions [a06-4657_1ex10d98.htm#a22_SurvivalOfProvisions__085320]

25

 

 

 

23. [a06-4657_1ex10d98.htm#a23_Miscellaneous__085324]

Miscellaneous [a06-4657_1ex10d98.htm#a23_Miscellaneous__085324]

26

 

i

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24. [a06-4657_1ex10d98.htm#a24_IntentionallyOmitted__085328]

Intentionally Omitted [a06-4657_1ex10d98.htm#a24_IntentionallyOmitted__085328]

27

 

 

 

25. [a06-4657_1ex10d98.htm#a25_SophisticationOfTheParties_Ea_085331]

Sophistication of the Parties
[a06-4657_1ex10d98.htm#a25_SophisticationOfTheParties_Ea_085331]

27

 

 

 

26. [a06-4657_1ex10d98.htm#a26_LimitedLiability_TheObligatio_085333]

Limited Liability
[a06-4657_1ex10d98.htm#a26_LimitedLiability_TheObligatio_085333]

27

 

 

 

27. [a06-4657_1ex10d98.htm#a27_Marketing_SellerShallHaveTheR_085338]

Marketing [a06-4657_1ex10d98.htm#a27_Marketing_SellerShallHaveTheR_085338]

27

 

 

 

28. [a06-4657_1ex10d98.htm#a28_Enforcement_IfEitherPartyHere_085340]

Enforcement [a06-4657_1ex10d98.htm#a28_Enforcement_IfEitherPartyHere_085340]

27

 

Exhibits

 

“A”                          Legal Description of Premises

“B”                            List of Personal Property

“C”                            Intentionally Omitted

“D”                           Intentionally Omitted

“E”                             List of Existing Agreements To Be Assigned

“F”                             Form of Assignment and Assumption Agreement

“G”                            Information Materials

“H”                           Intentionally Omitted

“I”                                Intentionally Omitted

“J”                               Form of Deed

“K”                           Form of Bill of Sale

“L”                             Form of FIRPTA Certification

 

ii

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AGREEMENT OF SALE

 

This AGREEMENT OF SALE (this “Agreement”) is made as of February 3, 2006 (the
“Effective Date”) by and between 2975 STENDER ASSOCIATES LLC, a Delaware limited
liability company (“Seller”), and CATALYST SEMICONDUCTOR, INC., a Delaware
corporation (“Buyer”).

 

W I T N E S S E T H:

 

1.                                                               SALE AND
PURCHASE.  SELLER HEREBY AGREES TO SELL AND CONVEY TO BUYER, AND BUYER HEREBY
AGREES TO PURCHASE FROM SELLER, UPON THE TERMS AND CONDITIONS HEREINAFTER SET
FORTH, ALL OF SELLER’S RIGHT, TITLE AND INTEREST IN AND TO THE FOLLOWING:

 

(A)  REAL PROPERTY.  THAT CERTAIN LOT OR PARCEL OF REAL PROPERTY LOCATED AT 2975
STENDER WAY, SANTA CLARA, CALIFORNIA, AS MORE PARTICULARLY DESCRIBED ON
EXHIBIT ”A” HERETO, AND THAT CERTAIN TWO-STORY BUILDING (THE “BUILDING”) AND
RELATED IMPROVEMENTS SITUATED ON SUCH PARCEL, TOGETHER WITH ALL THE RIGHTS AND
APPURTENANCES PERTAINING THERETO, INCLUDING ANY RIGHT, TITLE AND INTEREST OF
SELLER (IF ANY) IN AND TO ADJACENT STREETS AND RIGHTS-OF-WAY AND TO ALL
MINERALS, OIL, GAS AND OTHER HYDROCARBON SUBSTANCES THEREON AND THEREUNDER, AS
WELL AS ALL DEVELOPMENT RIGHTS, AIR RIGHTS, WATER, WATER RIGHTS, RIPARIAN RIGHTS
AND WATER STOCK RELATING THERETO (COLLECTIVELY, THE “PREMISES”);

 

(B)  PERSONAL PROPERTY.  THE FIXTURES, FURNISHINGS, EQUIPMENT AND OTHER ITEMS OF
PERSONAL PROPERTY, IF ANY, OWNED BY SELLER AND LOCATED ON, AND USED IN
CONNECTION WITH THE OPERATION OF THE PREMISES, INCLUDING, WITHOUT LIMITATION,
ALL APPARATUS, EQUIPMENT AND APPLIANCES USED IN CONNECTION WITH THE OPERATION OR
OCCUPANCY OF THE PREMISES, SUCH AS HEATING AND AIR CONDITIONING SYSTEMS AND
FACILITIES USED TO PROVIDE ANY UTILITY, REFRIGERATION, VENTILATION, GARBAGE
DISPOSAL, OR OTHER SERVICES ON THE PREMISES, AND ALONG WITH ALL ON-SITE PARKING
(COLLECTIVELY, THE “PERSONAL PROPERTY”); AND

 

(C)  RELATED MATERIALS.  TO THE EXTENT TRANSFERABLE WITHOUT COST TO SELLER AND
TO THE EXTENT IN THE POSSESSION OR CONTROL OF SELLER OR SELLER’S PROPERTY
MANAGER, ALL OTHER INTANGIBLE PROPERTY, LICENSES, ENTITLEMENTS, BUILDING PLANS,
SITE PLANS, PERMITS, WARRANTIES AND GUARANTIES, IF ANY, WHICH RELATE TO THE
PROPERTY BEING CONVEYED TO SELLER BY BUYER ON THE DATE HEREOF (COLLECTIVELY, THE
“RELATED MATERIALS”, AND, TOGETHER WITH THE PREMISES, EXISTING AGREEMENTS AND
PERSONAL PROPERTY, THE “PROPERTY”).

 

2.                                                               CERTAIN
FUNDAMENTAL TERMS; PAYMENT OF PURCHASE PRICE.  FOR EASE OF REFERENCE, CERTAIN
FUNDAMENTAL TERMS OF THE TRANSACTION CONTEMPLATED HEREBY ARE SET FORTH AS
FOLLOWS:

 

(a)

 

Purchase Price:

 

Three Million Seven Hundred Thousand and 00/100 Dollars ($3,700,000.00), subject
to adjustments as provided hereinbelow.

(b)

 

Initial Deposit.

 

One Hundred Thousand and 00/100 Dollars ($100,000.00)

(c)

 

Second Deposit.

 

One Hundred Thousand and 00/100 Dollars ($100,000.00)

(d)

 

Inspection Period:

 

Begins on the Effective Date and ends at 5:00 p.m., Santa Clara, California
local time, on March 6, 2006.

(e)

 

Closing Date:

 

On or before March 16, 2006 (as such date may be extended pursuant to the terms
of this Agreement).

 

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The Purchase Price shall be paid as follows:

 

(A)  DEPOSIT.  NO LATER THAN TWO (2) BUSINESS DAYS AFTER THE EFFECTIVE DATE,
BUYER SHALL DELIVER THE INITIAL DEPOSIT TO FIRST AMERICAN TITLE COMPANY (THE
“ESCROWEE” AND, IN ITS CAPACITY AS TITLE INSURER HEREUNDER, THE “TITLE COMPANY”)
IN IMMEDIATELY AVAILABLE UNITED STATES FEDERAL FUNDS.  UPON RECEIPT BY ESCROWEE
OF A FULLY-EXECUTED COPY OF THIS AGREEMENT AND THE INITIAL DEPOSIT, ESCROWEE
SHALL OPEN AN ESCROW ACCOUNT FOR THE TRANSACTION CONTEMPLATED HEREBY (THE
“OPENING OF ESCROW”) AND PROMPTLY NOTIFY BUYER AND SELLER OF THE DATE OF OPENING
OF ESCROW, THE ESCROW ACCOUNT NUMBER AND ESCROW ACCOUNT WIRING INSTRUCTIONS.  NO
LATER THAN ONE (1) BUSINESS DAY AFTER THE OPENING OF ESCROW, ESCROWEE SHALL SIGN
THIS AGREEMENT TO ACKNOWLEDGE ITS AGREEMENT TO THE ESCROW INSTRUCTIONS SET FORTH
HEREIN AND RETURN A SIGNED COPY OF THIS AGREEMENT TO BUYER AND SELLER.  THE
ESCROWEE SHALL HOLD THE INITIAL DEPOSIT IN ESCROW IN AN INTEREST BEARING ACCOUNT
WITH A FEDERALLY INSURED STATE OR NATIONAL BANK ACCEPTABLE TO SELLER AND BUYER. 
AT SELLER’S OPTION, THIS AGREEMENT SHALL TERMINATE IF THE INITIAL DEPOSIT IS NOT
SO DEPOSITED BY THE TIME REQUIRED (IN WHICH EVENT NEITHER PARTY SHALL HAVE ANY
FURTHER RIGHTS OR OBLIGATIONS HEREUNDER EXCEPT FOR THE OBLIGATIONS OF BUYER
HEREUNDER WHICH BY THEIR TERMS SURVIVE THE TERMINATION OF THIS AGREEMENT). 
UNLESS BUYER TIMELY TERMINATES THIS AGREEMENT BEFORE THE EXPIRATION OF THE
INSPECTION PERIOD IN ACCORDANCE WITH PARAGRAPH 19(C) HEREOF, THEN NO LATER THAN
ONE (1) BUSINESS DAY AFTER THE LAST DAY OF THE INSPECTION PERIOD, BUYER SHALL
DELIVER THE SECOND DEPOSIT TO ESCROWEE IN IMMEDIATELY AVAILABLE UNITED STATES
FEDERAL FUNDS.  THE INITIAL DEPOSIT AND SECOND DEPOSIT ARE HEREINAFTER
COLLECTIVELY REFERRED TO AS THE “DEPOSIT”.  ALL INTEREST EARNED ON THE DEPOSIT
SHALL BE ADDED TO AND MADE A PART OF THE DEPOSIT FOR ALL PURPOSES HEREOF. 
EXCEPT AS OTHERWISE EXPRESSLY PROVIDED TO THE CONTRARY UNDER SECTIONS 4(C),
4(F), 14(B), 16(C), 17(B) OR 19(C) OF THIS AGREEMENT, THE DEPOSIT, TOGETHER WITH
ALL INTEREST EARNED THEREON, SHALL BE NONREFUNDABLE UPON THE EXPIRATION OF THE
INSPECTION PERIOD.  AT CLOSING (AS HEREINAFTER DEFINED), THE DEPOSIT SHALL BE
CREDITED AGAINST THE PURCHASE PRICE.

 

(B)  CLOSING PAYMENT.  NO LATER THAN ONE (1) BUSINESS DAY BEFORE THE CLOSING
DATE, BUYER SHALL DELIVER TO ESCROWEE THE BALANCE OF THE PURCHASE PRICE
(ADJUSTED AS HEREINAFTER PROVIDED), FOR PAYMENT TO SELLER AT CLOSING, WHICH
BALANCE SHALL BE DELIVERED BY WIRE TRANSFER OF IMMEDIATELY AVAILABLE FEDERAL
FUNDS, TO THE ACCOUNT SPECIFIED BY, AND IN ACCORDANCE WITH WIRING INSTRUCTIONS
TO BE PROVIDED BY, THE ESCROWEE.  NOTWITHSTANDING THE FOREGOING, BUYER MAY
DELIVER THE BALANCE OF THE PURCHASE PRICE TO ESCROWEE ON THE CLOSING DATE SO
LONG AS SELLER RECEIVES ITS NET SALE PROCEEDS NO LATER THAN THE CLOSING DATE.

 

 

(C)  REDUCTION IN PURCHASE PRICE AT CLOSING.  EFFECTIVE UPON THE CLOSING, THE
PURCHASE PRICE SHALL BE REDUCED BY THREE THOUSAND FIVE HUNDRED AND 00/100
DOLLARS ($3,500.00).  BUYER ACKNOWLEDGES AND AGREES THAT SUCH REDUCTION IS BEING
MADE IN RECOGNITION AND CONSIDERATION OF THE FOLLOWING:  (I) PRIOR TO THE
EFFECTIVE DATE, SELLER ENGAGED ARS ASBESTOS REMOVAL SERVICE TO PERFORM CERTAIN
ASBESTOS REMEDIATION WORK IN RESPECT OF THE REMOVAL AND DISPOSAL OF
APPROXIMATELY 400 SQUARE FEET OF FLOOR TILE AND 1,200 SQUARE FEET OF BLACK
MASTIC ON THE FIRST FLOOR COMPUTER ROOM UNDERNEATH CERTAIN RAISED COMPUTER FLOOR
PANELS; (II) SUCH REMEDIATION HAS NOT BEEN COMPLETED AND IT WILL COST
APPROXIMATELY $3,500 TO COMPLETE THE REMEDIATION; (III) NOTWITHSTANDING ANYTHING
IN THIS AGREEMENT THAT MAY BE CONSTRUED TO THE CONTRARY, SELLER SHALL HAVE NO
RESPONSIBILITY FOR COMPLETING SUCH REMEDIATION; AND (IV) FROM AND AFTER THE
CLOSING, BUYER SHALL BE SOLELY RESPONSIBLE FOR COMPLETING SUCH REMEDIATION WORK.

 

2

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3.                                                               CLOSING.  THE
CLOSING OF THE TRANSACTION CONTEMPLATED HEREBY (THE “CLOSING”) SHALL BE DEEMED
TO HAVE OCCURRED ONCE THE FOLLOWING CONDITIONS HAVE BEEN SATISFIED:  (I) THE
DEED (AS DEFINED BELOW) HAS BEEN RECORDED IN THE OFFICIAL RECORDS OF SANTA CLARA
COUNTY, CALIFORNIA, AND (II) SELLER HAS RECEIVED THE NET SALE PROCEEDS PAYABLE
TO SELLER PURSUANT TO THIS AGREEMENT.  THE CLOSING SHALL BE HELD AND COMPLETED
THROUGH ESCROWEE ON OR BEFORE THE CLOSING DATE.  THE PARTIES ACKNOWLEDGE AND
AGREE THAT TIME IS OF THE ESSENCE IN THIS AGREEMENT AND THE TRANSACTIONS
CONTEMPLATED HEREBY.

 

4.                                                               CONDITION OF
TITLE.

 

(A)  TITLE TO PREMISES.  FEE SIMPLE TITLE TO THE PREMISES SHALL BE CONVEYED BY
SELLER TO BUYER AT THE COMPLETION OF CLOSING BY THE DEED (AS HEREINAFTER
DEFINED), SUBJECT ONLY TO THE PERMITTED ENCUMBRANCES (AS HEREINAFTER DEFINED). 
SELLER’S INTEREST IN THE PERSONAL PROPERTY SHALL BE CONVEYED BY SELLER TO BUYER
AT THE COMPLETION OF CLOSING BY THE BILL OF SALE, AS HEREINAFTER DEFINED.  THE
TERM “PERMITTED ENCUMBRANCES” SHALL MEAN (I) TAXES AND ASSESSMENTS WHICH ARE NOT
YET DELINQUENT, (II) ALL MATTERS THAT WOULD BE DISCLOSED BY A PHYSICAL
INSPECTION OR ACCURATE SURVEY OF THE PROPERTY, (III) ALL COVENANTS, CONDITIONS,
EASEMENTS, RESTRICTIONS, LIENS, ENCUMBRANCES AND OTHER MATTERS OF TITLE THAT
HAVE BEEN APPROVED OR DEEMED APPROVED BY BUYER AS PROVIDED IN SECTION 4(C) OR
4(F) BELOW, (IV) ALL LAWS, REGULATIONS OR ORDINANCES (INCLUDING, BUT NOT LIMITED
TO, ZONING, BUILDING AND ENVIRONMENTAL LAWS, REGULATIONS AND ORDINANCES)
APPLICABLE TO THE PROPERTY, AND (V) THE STANDARD PRINTED EXCEPTIONS,
STIPULATIONS AND EXCLUSIONS FROM COVERAGE CONTAINED IN THE STANDARD COVERAGE
CLTA FORM OF OWNER’S POLICY OF TITLE INSURANCE.

 

(B)  SURVEY.  BUYER ACKNOWLEDGES THAT IT HAS RECEIVED A COPY OF THE MOST CURRENT
SURVEY OF THE PREMISES IN SELLER’S POSSESSION (THE “SURVEY”).  AT NO COST OR
LIABILITY TO SELLER, SELLER SHALL, PROMPTLY AFTER THE EFFECTIVE DATE, REQUEST
THE SURVEYOR OF THE SURVEY TO CERTIFY THE SURVEY TO BUYER.  PROMPTLY AFTER THE
EFFECTIVE DATE, BUYER MAY ORDER, AT ITS SOLE COST AND EXPENSE, AN UPDATE TO THE
SURVEY, TO BE CERTIFIED TO SELLER, BUYER AND THE TITLE COMPANY, AND TO BE
PREPARED IN ACCORDANCE WITH SURVEY STANDARDS SELECTED BY BUYER (THE “UPDATED
SURVEY”).  NOTHING CONTAINED IN THIS AGREEMENT, INCLUDING THE PROVISIONS OF
PARAGRAPH 1(A) HEREOF, SHALL CONSTITUTE ANY WARRANTY, REPRESENTATION OR
AGREEMENT BY SELLER AS TO THE LOCATION OF SEPARATE LOTS IN, OR ACREAGE OF, THE
PREMISES.

 

(C)  TITLE MATTERS.  BUYER ACKNOWLEDGES THAT IT HAS, WITH RESPECT TO THE
PREMISES, RECEIVED A PRELIMINARY TITLE REPORT DATED AS OF JANUARY 25, 2006 AND
ISSUED BY THE TITLE COMPANY UNDER ORDER NUMBER NCS-214398-SC (“TITLE REPORT”),
TOGETHER WITH COPIES OF ALL DOCUMENTS REFERRED TO THEREIN AS EXCEPTIONS TO TITLE
(“TITLE DOCUMENTS”).  BUYER SHALL BE DEEMED TO HAVE WAIVED ITS RIGHT TO OBJECT
TO ANY ENCUMBRANCE OR OTHER TITLE EXCEPTION OR MATTER REFLECTED IN THE TITLE
REPORT OR TITLE DOCUMENTS UNLESS BUYER SHALL HAVE GIVEN SELLER WRITTEN NOTICE OF
ITS OBJECTIONS (A “TITLE NOTICE”) WITHIN TEN (10) BUSINESS DAYS AFTER THE
EFFECTIVE DATE; PROVIDED, HOWEVER, BUYER RESERVES THE RIGHT TO OBJECT TO ANY NEW
MATTERS FIRST DISCLOSED ON ANY UPDATE TO THE TITLE REPORT AS PROVIDED IN
SECTION 4(F) BELOW.  BUYER SHALL BE DEEMED TO HAVE WAIVED ITS RIGHT TO OBJECT TO
ANY ENCUMBRANCE OR OTHER TITLE EXCEPTION OR MATTER REFLECTED IN THE SURVEY
UNLESS BUYER SHALL HAVE GIVEN SELLER A TITLE NOTICE DETAILING ITS OBJECTIONS
THERETO WITHIN TEN (10) BUSINESS DAYS AFTER THE EFFECTIVE DATE; PROVIDED,
HOWEVER, BUYER RESERVES THE RIGHT TO OBJECT TO ANY MATTERS REFLECTED ON THE
UPDATED SURVEY THAT WERE NOT REFLECTED ON THE SURVEY AS PROVIDED IN
SECTION 4(F) BELOW.  UPON BUYER’S FAILURE TO TIMELY OBJECT PURSUANT TO THE
FOREGOING PROVISIONS OF THIS PARAGRAPH, ANY ENCUMBRANCE OR OTHER TITLE EXCEPTION
OR MATTER REFLECTED ON THE TITLE REPORT OR IN THE TITLE DOCUMENTS OR SURVEY
SHALL THEREAFTER BE DEEMED A “PERMITTED ENCUMBRANCE”.

 

3

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

 

SELLER SHALL HAVE THE RIGHT, AT ITS SOLE OPTION, WITHIN FIVE (5) BUSINESS DAYS
OF RECEIPT OF BUYER’S TITLE NOTICE (THE “SELLER TITLE RESPONSE PERIOD”), OF
DELIVERING WRITTEN NOTICE TO BUYER (THE “SELLER TITLE NOTICE”), THAT SELLER WILL
EITHER (I) REMOVE ANY ENCUMBRANCE OR OTHER TITLE EXCEPTION OR MATTER TO WHICH
BUYER HAS OBJECTED, (II) PROVIDE THE TITLE COMPANY SUCH ASSURANCES AS THE TITLE
COMPANY REQUIRES TO INSURE BUYER AGAINST ANY LOSS ARISING FROM SUCH ENCUMBRANCE
OR OTHER TITLE EXCEPTION OR MATTER, OR (III) DO NEITHER (I) NOR (II).  FAILURE
BY SELLER TO DELIVER THE SELLER TITLE NOTICE SHALL BE DEEMED AN ELECTION UNDER
SUB-ITEM (III) ABOVE IN THIS SUBPARAGRAPH (C).  IF SELLER DOES NOT ELECT TO
EFFECT THE CURE OR PROVIDE THE ASSURANCES CONTEMPLATED BY SUB-ITEM (I) OR
(II) OF THIS SUBPARAGRAPH (C), BUYER MAY ELECT, AS ITS SOLE RIGHT AND REMEDY BY
REASON THEREOF, EITHER (X) TO TAKE SUCH TITLE TO THE PREMISES AS SELLER CAN
CONVEY, WITH NO ABATEMENT OF THE PURCHASE PRICE, OR (Y) UPON WRITTEN DEMAND
DELIVERED BY BUYER TO SELLER AND ESCROWEE (THE “BUYER ELECTION NOTICE”) NO LATER
THAN THE EARLIER TO OCCUR OF THE EXPIRATION OF THE INSPECTION PERIOD OR FIVE
(5) BUSINESS DAYS AFTER BUYER’S RECEIPT OF THE SELLER TITLE NOTICE, TO TERMINATE
THIS AGREEMENT AND RECEIVE THE RETURN OF THE DEPOSIT.  BUYER’S FAILURE TO TIMELY
DELIVER THE BUYER ELECTION NOTICE IN ACCORDANCE WITH THE FOREGOING PROVISIONS OF
THIS SUBPARAGRAPH (C) SHALL BE DEEMED AN ELECTION BY BUYER UNDER THE FOREGOING
SUB-ITEM (X) OF THIS SUBPARAGRAPH (C).  NOTWITHSTANDING THE FOREGOING PROVISIONS
OF THIS PARAGRAPH 4, BUYER AGREES TO ACCEPT TITLE TO THE PROPERTY SUBJECT TO
JUDGMENTS AGAINST SELLER AND/OR MONETARY LIENS IF THE TITLE COMPANY INSURES
BUYER AGAINST ANY LOSS BY REASON OF SUCH JUDGMENTS AND/OR LIENS, IN EACH CASE
OTHER THAN JUDGMENTS OR LIENS FOR MORE THAN $150,000.00, INDIVIDUALLY OR IN THE
AGGREGATE.  NOTWITHSTANDING ANYTHING IN THIS AGREEMENT THAT MAY BE CONSTRUED TO
THE CONTRARY AND EXCEPT AS OTHERWISE SET FORTH IN ANY SELLER TITLE NOTICE,
SELLER SHALL HAVE NO OBLIGATION TO CURE ANY ALLEGED DEFECT, OBJECTION OR SURVEY
MATTER RAISED IN ANY TITLE NOTICE OTHER THAN ANY CONSENSUAL MORTGAGE OR DEED OF
TRUST EXECUTED BY SELLER; PROVIDED, HOWEVER, THAT SELLER FURTHER AGREES TO CURE,
AT THE CLOSING, ANY OTHER MONETARY LIEN OR LIENS WHICH ARE NOT CAUSED BY BUYER
PROVIDED SUCH LIENS DO NOT EXCEED AN AMOUNT EQUAL TO THIRTY FIVE THOUSAND AND
00/100 DOLLARS ($35,000.00) IN THE AGGREGATE (SUCH OTHER MONETARY LIENS ARE
REFERRED TO HEREIN AS THE “MANDATORY CURE LIENS”).  IN ANY EVENT, SELLER SHALL
HAVE THE RIGHT, AT ITS SOLE OPTION, TO EXTEND THE CLOSING DATE BY AN ADDITIONAL
SIXTY (60) DAYS IN ORDER TO CURE ANY ALLEGED DEFECT, OBJECTION OR SURVEY MATTER
RAISED IN ANY TITLE NOTICE OR TO OTHERWISE SATISFY ITS OBLIGATIONS UNDER THIS
PARAGRAPH.  UPON ANY RETURN OF THE DEPOSIT TO BUYER PURSUANT TO THIS PARAGRAPH,
THIS AGREEMENT SHALL BE DEEMED NULL AND VOID, NEITHER PARTY SHALL HAVE ANY
FURTHER RIGHTS OR OBLIGATIONS HEREUNDER (EXCEPT FOR THE OBLIGATIONS OF BUYER
HEREUNDER WHICH BY THEIR TERMS SURVIVE THE TERMINATION OF THIS AGREEMENT).

 

(D)  RELIANCE ON TITLE POLICY.  NOTWITHSTANDING ANYTHING CONTAINED IN THIS
AGREEMENT TO THE CONTRARY, WITH RESPECT TO ALL MATTERS AFFECTING TITLE TO THE
PREMISES AND ANY LIENS OR OTHER ENCUMBRANCES AFFECTING THE PREMISES, BUYER
ACKNOWLEDGES AND AGREES IT IS RELYING UPON ITS TITLE INSURANCE POLICY.  IF BUYER
HAS A MERITORIOUS CLAIM UNDER ITS TITLE INSURANCE POLICY AND THE SUBJECT MATTER
OF THAT CLAIM ALSO CONSTITUTES A BREACH OF ANY WARRANTY MADE BY SELLER IN THIS
AGREEMENT OR THE DEED, BUYER AGREES THAT IT WILL LOOK FIRST TO ITS TITLE
INSURANCE POLICY FOR RECOVERY ON SUCH CLAIM, AND BUYER SHALL NOT ASSERT ANY
CLAIM AGAINST SELLER FOR A BREACH OF A REPRESENTATION, WARRANTY OR COVENANT WITH
RESPECT TO SUCH CLAIM UNLESS AND UNTIL BUYER HAS PURSUED ITS REMEDIES AGAINST
THE TITLE COMPANY TO FINAL JUDGMENT AND HAS NOT BEEN MADE WHOLE; PROVIDED,
HOWEVER, THAT BUYER SHALL HAVE THE RIGHT TO FILE AN ACTION AGAINST SELLER PRIOR
TO SUCH FINAL JUDGMENT IF AND TO THE EXTENT NECESSARY TO PREVENT THE EXPIRATION
OF THE SURVIVAL PERIOD (AS DEFINED IN PARAGRAPH 22(C) BELOW) APPLICABLE TO THE
WARRANTY THAT HAS BEEN BREACHED. THE PROVISIONS OF THIS SUBPARAGRAPH (D) SHALL
SURVIVE CLOSING AND DELIVERY OF THE DEED.

 

(E)  INTENTIONALLY OMITTED.

 

4

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(F)  UPDATED TITLE REPORT AND UPDATED SURVEY.  AT ANY TIME PRIOR TO CLOSING,
BUYER MAY REQUEST THE TITLE COMPANY TO ISSUE UPDATES OR SUPPLEMENTS TO THE TITLE
REPORT.  IF ANY NEW ENCUMBRANCE OR NEW TITLE EXCEPTION IS FIRST REFLECTED ON ANY
UPDATED SURVEY OR ON ANY UPDATE OR SUPPLEMENT TO THE TITLE REPORT (EACH A “TITLE
UPDATE”), BUYER SHALL BE DEEMED TO HAVE WAIVED ITS RIGHT TO OBJECT TO SUCH NEW
ENCUMBRANCE OR TITLE EXCEPTION UNLESS BUYER SHALL HAVE GIVEN A TITLE NOTICE TO
SELLER WITH RESPECT THERETO ON OR BEFORE THE EARLIER TO OCCUR OF (X) THE
EXPIRATION OF FIVE (5) BUSINESS DAYS AFTER THE RECEIPT BY BUYER OF SUCH TITLE
UPDATE, AND (Y) TWO (2) BUSINESS DAYS PRIOR TO THE CLOSING.  NOTWITHSTANDING THE
FOREGOING OR ANYTHING IN THIS AGREEMENT THAT MAY BE CONSTRUED TO THE CONTRARY,
UNLESS BUYER TERMINATES THIS AGREEMENT PURSUANT TO PARAGRAPH 19(C) HEREOF, BUYER
SHALL BE DEEMED TO HAVE APPROVED ALL MATTERS WHICH WERE DISCLOSED ON THE UPDATED
SURVEY OR WHICH WOULD HAVE BEEN DISCLOSED ON THE UPDATED SURVEY HAD BUYER
OBTAINED AN ACCURATE UPDATED SURVEY PRIOR TO THE EXPIRATION OF THE INSPECTION
PERIOD.

 

5.                                                               ASSIGNMENT OF
EXISTING AGREEMENTS.

 

(A)  INTENTIONALLY OMITTED.

 

(B)  EXISTING AGREEMENTS.  AT CLOSING, PURSUANT TO THE GENERAL ASSIGNMENT AND
ASSUMPTION AGREEMENT, SELLER SHALL ASSIGN TO BUYER, WITHOUT ANY REPRESENTATION
OR WARRANTY WHATSOEVER (EXCEPT AS OTHERWISE EXPRESSLY SET FORTH IN PARAGRAPH 9
OF THIS AGREEMENT OR IN THE INSTRUMENT OF ASSIGNMENT) TO THE EXTENT ASSIGNABLE,
AND TO THE EXTENT BUYER HAS ELECTED TO HAVE SUCH AGREEMENTS ASSIGNED TO IT, ALL
OF SELLER’S RIGHT, TITLE AND INTEREST IN, TO AND UNDER THE EXISTING AGREEMENTS
LISTED ON EXHIBIT ”E” HERETO (TOGETHER WITH ANY OTHER AGREEMENTS ENTERED INTO IN
ACCORDANCE WITH THIS SUBPARAGRAPH (B) HEREINAFTER COLLECTIVELY CALLED THE
“EXISTING AGREEMENTS”) AND THE RELATED MATERIALS. FOLLOWING THE EFFECTIVE DATE,
SELLER SHALL, NO LATER THAN FIVE (5) BUSINESS DAYS AFTER THE EFFECTIVE DATE,
PROVIDE BUYER WITH COPIES OF ANY AND ALL PROPOSED CONTRACTS, CONTRACT RENEWALS,
CONTRACT MODIFICATIONS AND CONTRACT AMENDMENTS WHICH SELLER PROPOSES TO EXECUTE
WITH RESPECT TO ANY EXISTING AGREEMENT (BUT BUYER SHALL HAVE NO APPROVAL RIGHTS
REGARDING THE SAME UNTIL AFTER THE INSPECTION PERIOD EXPIRES).  DURING THE
PERIOD FROM THE EXPIRATION OF THE INSPECTION PERIOD UNTIL THE CLOSING (OR
EARLIER TERMINATION OF THIS AGREEMENT), SELLER SHALL NOT HAVE THE RIGHT TO ENTER
INTO NEW SERVICE OR MAINTENANCE AGREEMENTS (EXCEPT FOR AGREEMENTS THAT SHALL BE
TERMINABLE, WITHOUT PENALTY OR PREMIUM, ON NOT MORE THAN THIRTY (30) DAYS’
NOTICE) OR MODIFY ANY EXISTING SERVICE OR MAINTENANCE AGREEMENTS IN ANY MATERIAL
RESPECT WITHOUT BUYER’S APPROVAL WHICH SHALL NOT BE UNREASONABLY WITHHELD OR
DELAYED AND SHALL BE DEEMED GIVEN IF BUYER DOES NOT DISAPPROVE WITHIN TEN
(10) BUSINESS DAYS OF A REQUEST FOR APPROVAL.  THE TERMINATION OR EXPIRATION OF
ANY OF THE EXISTING AGREEMENTS PRIOR TO CLOSING SHALL NOT EXCUSE BUYER FROM ITS
OBLIGATION TO COMPLETE CLOSING AND TO PAY THE FULL PURCHASE PRICE.

 

6.                                                               APPORTIONMENTS.

 

(A)  GENERALLY.

 

(I)                                     TAXES AND FEES.  REAL ESTATE TAXES FOR
THE REAL ESTATE TAX YEAR IN WHICH THE CLOSING OCCURS AND ANNUAL MUNICIPAL OR
SPECIAL DISTRICT ASSESSMENTS (ON THE BASIS OF THE ACTUAL FISCAL TAX YEARS FOR
WHICH SUCH TAXES ARE ASSESSED), WATER AND SEWER RENTALS, LICENSE, PERMIT AND
INSPECTION FEES AND RENTALS, AND SALES TAX SHALL BE APPORTIONED AS OF THE
CLOSING DATE BETWEEN BUYER AND SELLER.

 

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(II)                                  INTENTIONALLY OMITTED.

 

(III)                               INTENTIONALLY OMITTED.

 

(IV)                              INTENTIONALLY OMITTED.

 

(V)                                 OTHER APPORTIONMENTS.  AMOUNTS PAYABLE IN
CONNECTION WITH THE OPERATION AND MAINTENANCE EXPENSES OF THE PREMISES AND OTHER
RECURRING COSTS SHALL BE APPORTIONED AS OF THE CLOSING DATE.

 

(VI)                              TAXES AND ASSESSMENTS.  REAL ESTATE TAXES
SHALL BE APPORTIONED ON THE CLOSING DATE.  IF THE TAX BILL FOR THE REAL ESTATE
TAX YEAR IN WHICH THE CLOSING OCCURS HAS NOT BEEN ISSUED ON OR BEFORE THE DATE
OF THE CLOSING, THE APPORTIONMENT OF TAXES SHALL BE COMPUTED BASED UPON THE MOST
RECENT TAX BILL AVAILABLE.  IF, ON THE DATE OF CLOSING, BILLS FOR THE REAL
ESTATE TAXES IMPOSED UPON THE PREMISES FOR THE REAL ESTATE TAX YEAR IN WHICH
CLOSING OCCURS HAVE BEEN ISSUED BUT SHALL NOT HAVE BEEN PAID, SUCH TAXES SHALL
BE PAID AT THE TIME OF CLOSING.  SELLER EXPRESSLY RESERVES THE RIGHT TO, BUT
DOES NOT HAVE AN OBLIGATION TO, COMMENCE AND CONDUCT, AT ITS SOLE COST AND
EXPENSE, ANY TAX CERTIORARI OR REDUCTION PROCEEDINGS RELATING TO THE PREMISES IN
RESPECT OF THE REAL ESTATE TAX YEAR IN WHICH THE CLOSING OCCURS AND ALL PRIOR
REAL ESTATE TAX YEARS.  SELLER AGREES TO CONSULT WITH BUYER AND BUYER AGREES TO
REASONABLY COOPERATE WITH SELLER IN ALL SUCH PROCEEDINGS.

 

(VII)                           CONTRACT ARREARAGES.  ANY PORTION OF ANY
PAYMENTS RECEIVED BY BUYER AFTER THE DATE OF CLOSING UNDER ANY OF THE EXISTING
AGREEMENTS THAT RELATES TO PERIODS PRIOR TO CLOSING SHALL BE PROMPTLY PAID BY
BUYER TO SELLER.

 

(VIII)                        INTENTIONALLY OMITTED.

 

(IX)                                PRELIMINARY CLOSING ADJUSTMENT.  WITH THE
ASSISTANCE OF ESCROWEE, SELLER AND BUYER SHALL JOINTLY PREPARE A PRELIMINARY
CLOSING STATEMENT ON THE BASIS OF THE EXISTING AGREEMENTS, REAL ESTATE TAXES AND
OTHER SOURCES OF INCOME AND EXPENSES FOR THE PROPERTY, AND SHALL DELIVER SUCH
PRELIMINARY CLOSING STATEMENT TO EACH OTHER AND THE TITLE COMPANY ON OR PRIOR TO
THE CLOSING DATE; PROVIDED, HOWEVER, THAT SELLER AND BUYER SHALL WORK TOGETHER
IN GOOD FAITH TO PREPARE A WORKING DRAFT OF SUCH PRELIMINARY CLOSING STATEMENT
FOR MUTUAL REVIEW AND DISCUSSION PRIOR TO THE CLOSING DATE.  ALL APPORTIONMENTS
AND PRORATIONS PROVIDED FOR IN THIS PARAGRAPH 6 TO BE MADE AS OF THE CLOSING
DATE SHALL BE MADE, ON A PER DIEM BASIS, AS OF MIDNIGHT OF THE DAY IMMEDIATELY
PRECEDING THE CLOSING DATE.  THE PRELIMINARY CLOSING STATEMENT AND THE
APPORTIONMENTS AND/OR PRORATIONS REFLECTED THEREIN SHALL BE BASED UPON ACTUAL
FIGURES TO THE EXTENT AVAILABLE.  IF ANY OF THE APPORTIONMENTS AND/OR PRORATIONS
CANNOT BE CALCULATED ACCURATELY BASED ON ACTUAL FIGURES ON THE CLOSING DATE,
THEN (OTHER THAN WITH RESPECT TO DETERMINATION OF REAL ESTATE TAXES THAT SHALL
BE COMPUTED AS SET FORTH IN CLAUSE (VI) ABOVE) THEY SHALL BE CALCULATED BASED ON
SELLER’S AND BUYER’S GOOD FAITH ESTIMATES THEREOF AND REFLECTED ON A CLOSING
STATEMENT TO BE EXECUTED BY BUYER AND SELLER AT CLOSING, SUBJECT TO
RECONCILIATION AS HEREINAFTER PROVIDED.

 

(X)                                   POST-CLOSING RECONCILIATION.  IF THERE IS
AN ERROR ON THE CLOSING STATEMENT DELIVERED AT CLOSING OR, IF AFTER THE ACTUAL
FIGURES ARE AVAILABLE AS TO ANY ITEMS THAT WERE ESTIMATED ON THE CLOSING
STATEMENT DELIVERED AT CLOSING (INCLUDING, WITHOUT LIMITATION, REAL ESTATE TAXES
THAT WERE COMPUTED IN ACCORDANCE WITH CLAUSE (VI) ABOVE), IT IS DETERMINED THAT
ANY ACTUAL PRORATION OR APPORTIONMENT VARIES FROM THE AMOUNT THEREOF REFLECTED
ON THE CLOSING

 

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STATEMENT, THE PRORATION OR APPORTIONMENT SHALL BE ADJUSTED BASED ON THE ACTUAL
FIGURES AS SOON AS FEASIBLE BUT NOT LATER THAN TWELVE (12) MONTHS AFTER THE
CLOSING DATE.  EITHER PARTY OWING THE OTHER PARTY A SUM OF MONEY BASED ON SUCH
SUBSEQUENT PRORATION(S) SHALL PROMPTLY PAY SAID SUM TO THE OTHER PARTY.  SELLER
AND BUYER AGREE TO COOPERATE IN GOOD FAITH TO DETERMINE ANY AMOUNTS DUE TO
SELLER OR TO BUYER UNDER THIS SECTION 6(A) AND TO RECONCILE SUCH AMOUNTS IN
ACCORDANCE WITH THIS SUBPARAGRAPH (X) NO LATER THAN TWELVE (12) MONTHS AFTER THE
CLOSING DATE.

 

(B)  INTENTIONALLY OMITTED.

 

(C)  UTILITY READINGS.  SELLER SHALL USE REASONABLE EFFORTS TO OBTAIN READINGS
OF THE WATER AND ELECTRIC METERS ON THE PREMISES TO A DATE NO SOONER THAN TEN
(10) DAYS PRIOR TO THE CLOSING DATE.  AT OR PRIOR TO CLOSING, SELLER SHALL PAY
ALL CHARGES BASED UPON SUCH METER READINGS.  CLOSING SHALL BE COMPLETED EVEN IF
SOME OR ALL SUCH READINGS COULD NOT BE OBTAINED (IT BEING AGREED THAT UPON THE
OBTAINING THEREOF AFTER CLOSING, SELLER SHALL PROMPTLY PAY THE CHARGES INCURRED
WITH RESPECT TO THAT PORTION OF THE BILLING CYCLE THAT FALLS PRIOR TO CLOSING AS
REASONABLY DETERMINED BY SELLER AND BUYER BASED UPON SUCH POST-CLOSING READINGS.

 

(D)  SURVIVAL.  THE PROVISIONS OF THIS PARAGRAPH 6 SHALL SURVIVE CLOSING AND
DELIVERY OF THE DEED FOR A PERIOD OF TWELVE (12) MONTHS.

 

7.                                                               CLOSING COSTS.

 

(A)  BUYER’S COSTS.  BUYER SHALL PAY (I) THE COSTS OF ITS COUNSEL, ARCHITECT,
ENGINEERS AND OTHER PROFESSIONALS AND CONSULTANTS, (II) ANY RECORDING AND FILING
FEES, INCLUDING WITHOUT LIMITATION, THE FILING FEES RELATING TO RECORDING THE
DEED, (III) ALL TITLE COMPANY CHARGES IN EXCESS OF THE TITLE COMPANY’S PREMIUM
FOR A STANDARD COVERAGE CLTA OWNER’S TITLE POLICY (AND THE COST OF ALL
ENDORSEMENTS TO THE TITLE POLICY), AND (IV) ONE-HALF (1/2) OF ANY ESCROW FEES
AND OTHER CHARGES CHARGED BY ESCROWEE.

 

(B)  SELLER’S COSTS.  SELLER SHALL PAY (I) THE TITLE COMPANY’S PREMIUM FOR A
STANDARD COVERAGE CLTA OWNER’S TITLE POLICY; (II) DOCUMENTARY TRANSFER TAXES OR
FEES IMPOSED OR CHARGED BY THE COUNTY OF SANTA CLARA, CALIFORNIA IN CONNECTION
WITH THE TRANSFER OF THE PROPERTY TO BUYER, AND (III) ONE-HALF (1/2) OF ANY
ESCROW FEES AND OTHER CHARGES CHARGED BY ESCROWEE.

 

All other closing and escrow costs shall be apportioned between Buyer and Seller
in accordance with customary escrow closing practice in Santa Clara County,
California for substantially comparable transactions.

 

8.                                                               MUNICIPAL
IMPROVEMENTS/NOTICES.

 

(A)  ASSESSMENTS.  IF AND TO THE EXTENT THERE EXISTS ANY IMPROVEMENT ASSESSMENT
LIENS, MELLO ROOS BOND PAYMENTS OR OTHER SIMILAR ASSESSMENTS WHICH ENCUMBER OR
AFFECT THE PREMISES, BUYER HEREBY EXPRESSLY AGREES AND ASSUMES THE OBLIGATION TO
PAY ANY AND ALL FUTURE INSTALLMENTS OF SUCH BONDS OR ASSESSMENT LIENS AFFECTING
THE PREMISES WHICH ACCRUE FROM AND AFTER THE CLOSING (INCLUDING ANY FINES,
INTEREST OR PENALTIES THAT ACCRUE OR ARE IMPOSED THEREON IN CONNECTION WITH THE
NON-PAYMENT OF ANY UNPAID INSTALLMENTS THAT BECOME DUE ON OR AFTER THE
CLOSING).  SELLER SHALL HAVE NO OBLIGATION TO PAY THE PRINCIPAL AMOUNT OF ANY OF
SUCH ASSESSMENTS OR BONDS.

 

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(B)  SUBDIVISION AND DEVELOPMENT BONDS. IF AND TO THE EXTENT THERE EXISTS IN
FAVOR OF GOVERNMENTAL BODIES OR AGENCIES OR OTHER THIRD PARTIES IMPROVEMENT
BONDS (“BONDS”) WHICH INSURE THE COMPLETION OF OFF-SITE AND ON-SITE PUBLIC
IMPROVEMENTS RELATING TO THE PREMISES, THE PAYMENT OF ALL LABOR AND MATERIALS
RELATING TO SUCH IMPROVEMENTS OR THE PERFORMANCE OF THE PARTIES CONSTRUCTING
SUCH IMPROVEMENTS, BUYER SHALL, IF PERMITTED BY SUCH GOVERNMENTAL BODY OR AGENCY
OR OTHER THIRD PARTY, PROVIDE REPLACEMENT BONDS FOR THE BONDS AND BUYER SHALL,
FROM AND AFTER THE CLOSING, BE OBLIGATED TO PERFORM AS REQUIRED BY THE BONDS
AND/OR ANY REPLACEMENT BONDS AND TO PERFORM ANY AND ALL WORK REQUIRED BY THE
BENEFICIARY(IES) THEREUNDER, AND SHALL INDEMNIFY AND DEFEND SELLER FOR AND
AGAINST, AND HOLD SELLER HARMLESS FROM, ANY CLAIMS WHICH MAY BE MADE BY THE
BENEFICIARY(IES) OR THE BONDING COMPANY FOR RECOVERY OF THE BONDS AND/OR ANY
REPLACEMENT BONDS OR THE COMPLETION OF SUCH WORK.

 

(C)  SURVIVAL.  THE PROVISIONS OF THIS PARAGRAPH 8 SHALL SURVIVE CLOSING AND
DELIVERY OF THE DEED.

 

9.                                                               SELLER’S
REPRESENTATIONS AND COVENANTS.

 

(A)  SELLER HEREBY REPRESENTS TO BUYER THAT:

 

(I)                                     ORGANIZATION.  SELLER IS A LIMITED
LIABILITY COMPANY, DULY ORGANIZED AND VALIDLY EXISTING AND IN GOOD STANDING
UNDER THE LAWS OF THE STATE OF DELAWARE AND HAS ALL REQUISITE POWER AND
AUTHORITY TO CARRY ON ITS BUSINESS AS NOW CONDUCTED.

 

(II)                                  AUTHORIZATION.  SELLER HAS THE REQUISITE
POWER AND AUTHORITY TO ENTER INTO AND PERFORM THIS AGREEMENT AND THE
TRANSACTIONS CONTEMPLATED HEREBY, AND SELLER HAS DULY AUTHORIZED THE EXECUTION
OF THIS AGREEMENT AND WILL HAVE, ON OR PRIOR TO THE CLOSING DATE, DULY
AUTHORIZED THE EXECUTION OF THE DOCUMENTS WHICH ARE REQUIRED TO BE DELIVERED
HEREUNDER BY SELLER IN CONNECTION WITH THE CLOSING.  THIS AGREEMENT AND ALL
DOCUMENTS EXECUTED BY SELLER WHICH ARE TO BE DELIVERED TO BUYER AT THE CLOSING
WILL, AT THE TIME OF CLOSING, BE LEGAL, VALID AND BINDING OBLIGATIONS OF SELLER
ENFORCEABLE AGAINST SELLER IN ACCORDANCE WITH THEIR RESPECTIVE TERMS.

 

(III)                               NO VIOLATION OR CONFLICT.  THE EXECUTION,
DELIVERY AND PERFORMANCE OF THE AGREEMENT WILL NOT VIOLATE ANY OF SELLER’S
ORGANIZATIONAL OR GOVERNING DOCUMENTS OR ANY CONTRACT, AGREEMENT, COMMITMENT,
ORDER, JUDGMENT OR DECREE TO WHICH SELLER IS A PARTY OR BY WHICH BUYER IS BOUND.

 

(IV)                              CONDEMNATION.  TO SELLER’S KNOWLEDGE, THERE
ARE, AS OF THE DATE OF THIS AGREEMENT, NO EXISTING OR PENDING CONDEMNATION
PROCEEDINGS OR DEEDS IN LIEU OF CONDEMNATION AFFECTING THE PREMISES, NOR TO
SELLER’S KNOWLEDGE, HAS ANY SUCH PROCEEDINGS BEEN THREATENED IN WRITING WITH
RESPECT TO THE PREMISES, AS OF THE DATE OF THIS AGREEMENT.  SELLER SHALL
PROMPTLY NOTIFY BUYER OF ANY SUCH PROCEEDINGS OF WHICH SELLER BECOMES AWARE.

 

(V)                                 LITIGATION.  THERE IS, AS OF THE DATE OF
THIS AGREEMENT AND AS OF THE CLOSING DATE, NO PENDING LITIGATION THAT HAVE BEEN
SERVED AGAINST SELLER WITH RESPECT TO THE PREMISES (NOR TO SELLER’S KNOWLEDGE,
HAS SUCH LITIGATION BEEN, AS OF THE DATE OF THIS AGREEMENT, THREATENED IN
WRITING AGAINST SELLER) THAT WOULD, IN EACH CASE, MATERIALLY ADVERSELY AFFECT
SELLER’S ABILITY TO PERFORM ITS OBLIGATIONS UNDER THIS AGREEMENT.

 

(VI)                              FOREIGN PERSON.  SELLER IS NOT A “FOREIGN
PERSON” WITHIN THE MEANING OF SECTION 1445(F)(3) OF THE INTERNAL REVENUE CODE OF
1986, AS AMENDED.

 

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(VII)                           NO LEASE.  SELLER HAS NOT ENTERED INTO ANY LEASE
FOR ANY PORTION OF THE PREMISES.

 

(VIII)                        BANKRUPTCY.  SELLER HAS NOT FILED OR, TO SELLER’S
KNOWLEDGE, BEEN THE SUBJECT OF ANY FILING OF, A PETITION UNDER THE FEDERAL
BANKRUPTCY LAW OR ANY FEDERAL OR STATE INSOLVENCY LAWS OR LAWS FOR COMPOSITION
OF INDEBTEDNESS OR FOR THE REORGANIZATION OF DEBTORS.

 

(IX)                                OTHER COMPETING RIGHTS.  EXCEPT FOR THIS
AGREEMENT, SELLER HAS NOT GRANTED TO ANY PARTY ANY OPTION, OR ANY RIGHT OF FIRST
REFUSAL OR FIRST OFFER FOR THE SALE OF THE PROPERTY OR ANY PORTION THEREOF TO
SUCH PARTY.

 

(X)                                   KNOWLEDGE.  MR. DAVID ANDRIS IS THE PERSON
CURRENTLY AFFILIATED WITH THE SELLER THAT IS LIKELY TO HOLD THE MOST KNOWLEDGE
IN RESPECT OF THOSE REPRESENTATIONS OF SELLER HEREUNDER THAT ARE QUALIFIED TO
SELLER’S KNOWLEDGE OR BY WORDS OF SIMILAR IMPORT.

 

(XI)                                ENVIRONMENTAL REPORTS.  SELLER HAS DELIVERED
TO BUYER ALL ENVIRONMENTAL ASSESSMENT REPORTS IN SELLER’S POSSESSION WHICH
PERTAIN TO THE PREMISES.

 

(B)  IF SELLER NOTIFIES BUYER AFTER THE DATE OF THIS AGREEMENT OF ANY MATERIAL
AND ADVERSE MODIFICATION OR INACCURACY OF ANY OF SELLER’S REPRESENTATIONS AND
WARRANTIES IN SECTION 9, BUYER’S SOLE REMEDY SHALL BE THE RIGHT (TO BE EXERCISED
WITHIN TEN (10) DAYS OF BUYER’S RECEIPT OF SUCH NOTICE) TO TERMINATE THIS
AGREEMENT AND RECEIVE A REFUND OF THE DEPOSIT; PROVIDED, HOWEVER, THAT IF
SELLER’S NOTIFICATION TO BUYER WAS MADE BETWEEN THE EXPIRATION OF THE INSPECTION
PERIOD AND THE CLOSING DATE, AND IF THE MODIFICATION OR INACCURACY WAS THE
RESULT OF A WILLFUL ACT BY SELLER, THEN BUYER SHALL, IN ADDITION, BE ENTITLED TO
REIMBURSEMENT FOR OUT-OF-POCKET DUE DILIGENCE COSTS AND ATTORNEYS’ FEES
REASONABLY INCURRED BY BUYER IN CONNECTION WITH THIS AGREEMENT, UP TO A MAXIMUM
REIMBURSEMENT OF THIRTY FIVE THOUSAND AND 00/100 DOLLARS ($35,000.00).  IF BUYER
DOES NOT ELECT TO TERMINATE THIS AGREEMENT WITHIN SUCH TEN (10) DAY PERIOD,
BUYER SHALL BE DEEMED TO HAVE WAIVED ANY OBJECTION BUYER MAY HAVE TO SUCH
MODIFICATION OR INACCURACY AND SHALL PROCEED TO CLOSING.  BUYER SHALL BE
ENTITLED TO RELY ON SELLER’S REPRESENTATIONS AND WARRANTIES DURING THE SURVIVAL
PERIOD SET FORTH IN SECTION 22(C); PROVIDED, HOWEVER, THAT BUYER SHALL NOT BE
ENTITLED TO RELY ON ANY SUCH REPRESENTATIONS AND WARRANTIES TO THE EXTENT
BUYER’S INVESTIGATION OR INSPECTIONS PRIOR TO CLOSING DISCLOSES INACCURACIES IN
THE SAME.  THE PROVISIONS OF THIS PARAGRAPH IS NOT INTENDED TO, AND SHALL NOT,
ADVERSELY AFFECT THE PROVISIONS OF SECTION 22(C)(II) HEREOF.

 

(C)  ALL REFERENCES IN THIS PARAGRAPH 9 OR ELSEWHERE IN THIS AGREEMENT AND/OR IN
ANY OTHER DOCUMENT OR INSTRUMENT EXECUTED BY SELLER IN CONNECTION WITH OR
PURSUANT TO THIS AGREEMENT, TO “SELLER’S KNOWLEDGE” OR “TO THE KNOWLEDGE OF
SELLER” AND WORDS OF SIMILAR IMPORT SHALL REFER SOLELY TO FACTS WITHIN THE
ACTUAL KNOWLEDGE (WITHOUT INDEPENDENT INVESTIGATION OR INQUIRY) OF MR. DAVID
ANDRIS AND SHALL NOT BE CONSTRUED TO REFER TO THE KNOWLEDGE OF ANY OTHER
EMPLOYEE, OFFICER, DIRECTOR, SHAREHOLDER OR AGENT OF SELLER OR OF ANY OTHER
PERSON OR ENTITY, AND SHALL IN NO EVENT BE DEEMED TO INCLUDE IMPUTED OR
CONSTRUCTIVE KNOWLEDGE.  THE REFERENCE HEREIN TO MR. DAVID ANDRIS IS USED SOLELY
AS A BASIS TO DEFINE THE SCOPE AND LIMIT OF SELLER’S KNOWLEDGE HEREUNDER, IS NOT
INTENDED NOR SHALL IT BE CONSTRUED TO CAUSE SUCH PERSON TO HAVE ANY DUTY TO
INVESTIGATE OR INQUIRE, AND SHALL NOT CAUSE SUCH PERSON TO INCUR ANY LIABILITY
FOR ANYTHING IN CONNECTION WITH THE PROPERTY, THIS AGREEMENT, OR THE
TRANSACTIONS CONTEMPLATED HEREUNDER, INCLUDING, WITHOUT LIMITATION, FOR ANY
BREACH OF SELLER’S REPRESENTATIONS OR WARRANTIES SET FORTH ABOVE.

 

9

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(D)  NOTWITHSTANDING ANYTHING IN THIS AGREEMENT THAT MAY BE CONSTRUED TO THE
CONTRARY, ALL REPRESENTATIONS AND WARRANTIES OF SELLER SET FORTH IN THIS
AGREEMENT SHALL BE DEEMED AUTOMATICALLY QUALIFIED AND MODIFIED BY ANY FACTS
DISCLOSED IN ANY OF THE DOCUMENTS, REPORTS, INFORMATION OR MATERIALS THAT ARE
DELIVERED BY SELLER OR ITS AGENTS TO BUYER ON OR BEFORE THE DATE THAT IS TEN
(10) DAYS AFTER THE EFFECTIVE DATE, OR THAT ARE OTHERWISE KNOWN TO BUYER OR
DISCOVERED BY BUYER PRIOR TO THE EXPIRATION OF THE INSPECTION PERIOD.  THE
REPRESENTATIONS MADE BY SELLER IN THIS AGREEMENT, AS SO QUALIFIED AND MODIFIED,
SHALL BE DEEMED RE-MADE BY SELLER AS OF THE CLOSING DATE.  WITHOUT LIMITING THE
FIRST SENTENCE OF THIS PARAGRAPH, BUYER SHALL BE DEEMED TO HAVE KNOWLEDGE OF A
FACT OR CIRCUMSTANCE IF THE UNDERLYING INFORMATION OR FACTS RELATING TO
APPLICABLE REPRESENTATIONS AND WARRANTIES WERE DISCLOSED IN ANY OF THE EXISTING
AGREEMENTS, TITLE REPORT, TITLE DOCUMENTS, SURVEY, THIS AGREEMENT OR IN ANY
OTHER DOCUMENT DELIVERED OR OTHERWISE MADE AVAILABLE TO BUYER BY SELLER.

 

(E)  SUBJECT TO THE OTHER TERMS OF THIS PARAGRAPH, SELLER HEREBY CONSENTS TO ANY
REASONABLE EFFORTS BY BUYER PRIOR TO THE CLOSING DATE TO OBTAIN THE PERMITS
REQUIRED BY THE CITY OF SANTA CLARA IN RESPECT OF IMPROVEMENTS THAT BUYER
INTENDS TO CONSTRUCT AFTER THE CLOSING (COLLECTIVELY, THE “PERMITS”).  IN NO
EVENT, HOWEVER, SHALL BUYER BEGIN THE CONSTRUCTION OR INSTALLATION OF ANY
IMPROVEMENTS ON THE PROPERTY PRIOR TO THE CLOSING.  AT NO COST OR LIABILITY TO
SELLER, SELLER SHALL, PRIOR TO CLOSING, REASONABLY COOPERATE AND DO ALL ACTS AS
MAY BE REASONABLY REQUIRED OR REQUESTED BY BUYER IN CONNECTION WITH BUYER’S
EFFORTS TO OBTAIN THE PERMITS, INCLUDING, WITHOUT LIMITATION, (I) PROMPTLY
EXECUTING ALL APPLICATIONS AND OTHER REQUIRED DOCUMENTS, (II) PROVIDING ALL
INFORMATION REASONABLY REQUIRED BY BUYER IN CONNECTION WITH THE PERMITS, AND
(III) DELIVERING NECESSARY SUBMITTALS TO THE CITY OF SANTA CLARA.  BUYER SHALL
KEEP SELLER PROMPTLY AND REGULARLY INFORMED OF THE STATUS OF BUYER’S EFFORTS TO
OBTAIN THE PERMITS.  NOTWITHSTANDING THE FOREGOING, IN NO EVENT SHALL ANY
SUBMISSIONS OR INFORMATION DISCLOSED OR SUBMITTED BY SELLER PURSUANT TO THE
FOREGOING PROVISIONS OF THIS PARAGRAPH ENLARGE SELLER’S LIABILITY UNDER THIS
AGREEMENT IN ANY RESPECT (INCLUDING, WITHOUT LIMITATION, WITH RESPECT TO ANY
REPRESENTATIONS OR WARRANTIES OF SELLER THAT ARE EXPRESSLY SET FORTH IN THIS
AGREEMENT), NOR SHALL SUCH SUBMISSIONS OR INFORMATION CONSTITUTE ADDITIONAL
REPRESENTATIONS OR WARRANTIES OF SELLER TO BUYER OR OTHERWISE, NOR SHALL THE
ISSUANCE OF SUCH PERMITS CONSTITUTE A CONDITION TO CLOSING HEREUNDER.  BUYER
AGREES THAT IT SHALL KEEP THE PREMISES FREE FROM ANY LIENS ARISING IN CONNECTION
WITH THE PERMITS AND SHALL CAUSE ANY SUCH LIEN TO BE RELEASED OF RECORD BY
PAYMENT OR POSTING OF A PROPER BOND WITHIN FIFTEEN (15) DAYS FOLLOWING THE
IMPOSITION THEREOF.  SELLER AGREES TO ASSIGN ALL OF SELLER’S RIGHT, TITLE AND
INTEREST IN AND TO THE PERMITS, IF ANY, TO BUYER EFFECTIVE UPON THE CLOSING
PURSUANT TO THE GENERAL ASSIGNMENT AND ASSUMPTION AGREEMENT, IN EACH CASE
WITHOUT RECOURSE AND WITHOUT REPRESENTATION OR WARRANTY OF ANY KIND WHATSOEVER. 
AS A COVENANT THAT SHALL SURVIVE THE CLOSING OR ANY TERMINATION OF THIS
AGREEMENT, BUYER SHALL INDEMNIFY, DEFEND AND SAVE SELLER AND, AS THE CASE MAY
BE, ITS PARTNERS, TRUSTEES, SHAREHOLDERS, DIRECTORS, MEMBERS, OFFICERS,
EMPLOYEES, AGENTS AND OTHER REPRESENTATIVES HARMLESS OF AND FROM ANY AND ALL
CLAIMS, LIABILITIES, DAMAGES, LIENS, COSTS AND EXPENSES (INCLUDING, WITHOUT
LIMITATION, ATTORNEYS’ FEES AND COSTS) WHICH SELLER AND/OR ANY OF ITS PARTNERS,
TRUSTEES, SHAREHOLDERS, DIRECTORS, MEMBERS, OFFICERS, EMPLOYEES, AGENTS AND
OTHER REPRESENTATIVES MAY INCUR, SUFFER OR BE SUBJECT BY REASON OF OR IN ANY
MANNER RELATING TO BUYER’S EFFORTS TO OBTAIN THE PERMITS OR TO ANY EFFORTS BY
SELLER TO COOPERATE IN BUYER’S EFFORTS TO OBTAIN THE PERMITS.

 

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10.                                                         DELIVERY OF PREMISES
DOCUMENTS.

 

(A)  DELIVERIES.  BUYER ACKNOWLEDGES THAT, PRIOR TO THE DATE HEREOF, SELLER HAS,
TO THE EXTENT IN SELLER’S POSSESSION, FURNISHED OR MADE AVAILABLE TO BUYER THE
ITEMS LISTED ON EXHIBIT ”G” HERETO.

 

(B)  NO WARRANTY.  NOTWITHSTANDING THE PRIOR PROVISIONS OF THIS PARAGRAPH 10 TO
THE CONTRARY, BUYER ACKNOWLEDGES AND UNDERSTANDS THAT SOME OF THE MATERIALS
DELIVERED BY SELLER (OR HAVE BEEN MADE AVAILABLE FOR BUYER’S INSPECTION) HAVE
BEEN PREPARED BY PARTIES OTHER THAN SELLER OR SELLER’S CURRENT PROPERTY
MANAGER.  IN ANY EVENT, SELLER MAKES NO REPRESENTATION OR WARRANTY WHATSOEVER,
EXPRESS OR IMPLIED, AS TO THE COMPLETENESS, CONTENT OR ACCURACY OF ANY SUCH
DELIVERED (OR MADE AVAILABLE) MATERIALS EXCEPT AS EXPRESSLY SET FORTH IN
SECTION 9 HEREOF.

 

11.                                                         BUYER
REPRESENTATIONS.  BUYER HEREBY REPRESENTS TO SELLER, AS OF THE DATE HEREOF AND
AS OF THE DATE OF CLOSING, AS FOLLOWS:

 

(A)  ORGANIZATION.  BUYER IS A CORPORATION, DULY ORGANIZED AND VALIDLY EXISTING
UNDER THE LAWS OF THE STATE OF DELAWARE AND HAS ALL REQUISITE POWER AND
AUTHORITY TO CARRY ON ITS BUSINESS AS NOW CONDUCTED.

 

(B)  AUTHORIZATION.  BUYER HAS THE REQUISITE POWER AND AUTHORITY TO ENTER INTO
AND PERFORM THIS AGREEMENT AND THE TRANSACTIONS CONTEMPLATED HEREBY AND BUYER
HAS DULY AUTHORIZED THE EXECUTION OF THIS AGREEMENT AND OBTAINED ALL NECESSARY
CONSENTS (WHETHER FROM A GOVERNMENTAL AUTHORITY OR OTHER THIRD PARTY) IN ORDER
TO EXECUTE AND DELIVER THIS AGREEMENT AND TO PERFORM HEREUNDER AND OTHERWISE
CONSUMMATE THE TRANSACTIONS CONTEMPLATED HEREBY.

 

(C)  NO VIOLATION OR CONFLICT.  THE EXECUTION, DELIVERY AND PERFORMANCE OF THE
AGREEMENT WILL NOT VIOLATE ANY OF BUYER’S ORGANIZATIONAL OR GOVERNING DOCUMENTS
OR ANY CONTRACT, AGREEMENT, COMMITMENT, ORDER, JUDGMENT OR DECREE TO WHICH BUYER
IS A PARTY OR BY WHICH BUYER IS BOUND.

 

(D)  ERISA.  BUYER IS NOT ACQUIRING THE PREMISES OR THE PERSONAL PROPERTY WITH
THE ASSETS OF AN EMPLOYEE BENEFIT PLAN AS DEFINED IN SECTION 3(3) OF THE
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974 (“ERISA”).

 

(E)  LITIGATION.  THERE IS, AS OF THE DATE OF THIS AGREEMENT AND AS OF THE
CLOSING DATE, NO PENDING LITIGATION THAT HAVE BEEN SERVED AGAINST BUYER, NOR TO
BUYER’S KNOWLEDGE, HAS SUCH LITIGATION BEEN, AS OF THE DATE OF THIS AGREEMENT,
THREATENED IN WRITING AGAINST BUYER, THAT WOULD, IN EACH CASE, MATERIALLY
ADVERSELY AFFECT BUYER’S ABILITY TO PERFORM ITS OBLIGATIONS UNDER THIS
AGREEMENT.

 

(F)  BANKRUPTCY.  BUYER HAS NOT MADE A GENERAL ASSIGNMENT FOR THE BENEFIT OF
CREDITORS, FILED ANY VOLUNTARY PETITION IN BANKRUPTCY OR SUFFERED THE FILING OF
ANY INVOLUNTARY PETITION BY ITS CREDITORS, SUFFERED THE APPOINTMENT OF A
RECEIVER TO TAKE POSSESSION OF ALL OR SUBSTANTIALLY ALL OF ITS ASSETS, SUFFERED
THE ATTACHMENT OR OTHER JUDICIAL SEIZURE OF ALL OR SUBSTANTIALLY ALL OF ITS
ASSETS, OR ADMITTED IN WRITING ITS INABILITY TO PAY ITS DEBTS AS THEY COME DUE.

 

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12.                                                         CONDITIONS PRECEDENT
TO CLOSING.  (A)  BUYER SHALL NOT BE OBLIGATED TO CLOSE UNDER THIS AGREEMENT
UNLESS EACH OF THE FOLLOWING CONDITIONS HAVE BEEN WAIVED BY BUYER OR ARE
SATISFIED BY THE CLOSING DATE:

 

(I)                                     TITLE POLICY.  AS OF THE CLOSING DATE,
THE TITLE COMPANY IS PREPARED TO ISSUE, UPON PAYMENT OF THE TITLE PREMIUM
THEREFOR, A CLTA STANDARD COVERAGE OWNER’S POLICY OF TITLE INSURANCE WITH A
LIABILITY LIMIT IN THE AMOUNT OF THE PURCHASE PRICE AND WHICH INSURES THAT
BUYER, AS OF THE CLOSING, HOLDS FEE TITLE TO THE PROPERTY SUBJECT ONLY TO
PERMITTED ENCUMBRANCES (THE “TITLE POLICY”);

 

(ii)                                  Representations.  The representations and
warranties made by Seller in this Agreement are true and correct in all material
respects as of the Closing Date; and

 

(iii)                               No Default.  Seller shall have performed all
of the material obligations to be performed by Seller under this Agreement at or
prior to Closing Date.

 

(b)                                 Seller shall not be obligated to close under
this Agreement unless each of the following conditions have been waived by
Seller or have been satisfied by the Closing Date:

 

(i)                                     Accuracy of Representations.  The
representations and warranties made by Buyer in this Agreement are true and
correct in all material respects as of the Closing Date; and

 

(ii)                                  No Default.  Buyer shall have performed
all of the material obligations to be performed by Buyer under this Agreement at
or prior to the Closing Date, including without limitation timely delivery of
each portion of the Deposit and timely delivery of the balance of the Purchase
Price to Escrowee.

 

13.                                                         DELIVERIES AT
CLOSING.  (A)  SELLER’S DELIVERIES.  ON THE CLOSING DATE, SELLER SHALL DELIVER
TO THE ESCROWEE THE FOLLOWING:

 

(i)                                     Deed.  A grant deed with respect to the
Real Property, in substantially the form attached hereto as Exhibit ”J” (the
“Deed”).

 

(ii)                                  Bill of Sale.  A bill of sale with respect
to the Personal Property, if any, in substantially the form attached hereto as
Exhibit ”K” (the “Bill of Sale”).

 

(III)                               GENERAL ASSIGNMENT AND ASSUMPTION
AGREEMENT.  A GENERAL ASSIGNMENT AND ASSUMPTION AGREEMENT WITH RESPECT TO THE
EXISTING AGREEMENTS IN SUBSTANTIALLY THE FORM OF EXHIBIT ”F” HERETO (THE
“GENERAL ASSIGNMENT AND ASSUMPTION AGREEMENT”).

 

(IV)                              AUTHORITY DOCUMENTS.  IF REQUIRED BY THE TITLE
COMPANY, EVIDENCE OF REQUIRED LIMITED LIABILITY COMPANY AUTHORITY AND AN
INCUMBENCY CERTIFICATE TO EVIDENCE THE CAPACITY OF THE SIGNATORY FOR SELLER.

 

(V)                                 FIRPTA CERTIFICATION AND TITLE AFFIDAVIT. 
AN AFFIDAVIT IN THE FORM ATTACHED HERETO AS EXHIBIT ”L” WITH RESPECT TO
COMPLIANCE WITH THE FOREIGN INVESTMENT IN REAL PROPERTY TAX ACT (INTERNAL
REVENUE CODE SEC. 1445, AS AMENDED, AND THE REGULATIONS ISSUED THEREUNDER).

 

12

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(VI)                              INTENTIONALLY OMITTED.

 

(VII)                           KEYS.  ALL KEYS OF SELLER FOR THE PROPERTY.

 

(VIII)                        BOOKS AND RECORDS.  COPIES (TO THE EXTENT IN
SELLER’S POSSESSION OR CONTROL OR THE POSSESSION OR CONTROL OF SELLER’S PROPERTY
MANAGER) OF ALL BOOKS AND RECORDS REASONABLY REQUIRED FOR THE ORDERLY TRANSITION
OF OPERATION OF THE PREMISES.

 

(IX)                                ORIGINAL DOCUMENTS.  TO THE EXTENT IN
SELLER’S POSSESSION OR CONTROL OR IN THE POSSESSION OR CONTROL OF SELLER’S
PROPERTY MANAGER) THE ORIGINALS OR, IF UNAVAILABLE, COPIES OF THE EXISTING
AGREEMENTS AND (TO THE EXTENT IN SELLER’S POSSESSION OR THE POSSESSION OF
SELLER’S PROPERTY MANAGER) COPIES OF AS-BUILT PLANS AND SPECIFICATIONS FOR THE
IMPROVEMENTS AT THE PREMISES, PERMITS, LICENSES AND OTHER AGREEMENTS AND
APPROVALS RELATING TO THE MAINTENANCE AND OPERATION OF THE PROPERTY.

 

(X)                                   CLOSING STATEMENT.  A PRELIMINARY CLOSING
STATEMENT, MUTUALLY ACCEPTABLE TO BUYER AND SELLER, PREPARED IN ACCORDANCE WITH
THE TERMS OF THIS AGREEMENT.

 

(XI)                                OWNER’S AFFIDAVIT.  IF REQUESTED BY THE
TITLE COMPANY, AN OWNER’S AFFIDAVIT IN CUSTOMARY FORM REASONABLY ACCEPTABLE TO
THE SELLER.

 

Location at the Premises on the date of Closing of any of the materials referred
to in clauses (vii), (viii), and (ix) of this subparagraph (a) shall be deemed
delivery to Buyer.

 

(B)                                 BUYER’S DELIVERIES.  ON THE CLOSING DATE,
BUYER WILL DELIVER TO SELLER OR, AT SELLER’S DIRECTION, TO THE TITLE COMPANY,
THE FOLLOWING:

 

(I)                                     GENERAL ASSIGNMENT AND ASSUMPTION
AGREEMENT.  A SIGNED COUNTERPART OF THE GENERAL ASSIGNMENT AND ASSUMPTION
AGREEMENT.

 

(II)                                  BILL OF SALE.  A SIGNED COUNTERPART OF THE
BILL OF SALE.

 

(III)                               AUTHORITY DOCUMENTS.  AN AUTHORIZING
RESOLUTION AND AN INCUMBENCY CERTIFICATE, AND SUCH OTHER DOCUMENTS AS MAY BE
REASONABLY NECESSARY TO EVIDENCE THE AUTHORITY AND CAPACITY OF BUYER AND THE
AUTHORITY OF THE SIGNATORY FOR BUYER.

 

(IV)                              CLOSING STATEMENT.  A PRELIMINARY CLOSING
STATEMENT, MUTUALLY ACCEPTABLE TO BUYER AND SELLER, PREPARED IN ACCORDANCE WITH
THIS AGREEMENT.

 

(V)                                 OTHER DOCUMENTS.  ANY OTHER DOCUMENTS
(A) WHICH BUYER IS OBLIGATED TO DELIVER TO SELLER PURSUANT TO THIS AGREEMENT,
(B) THAT MAY BE REQUESTED BY THE TITLE COMPANY IN ORDER TO ISSUE THE TITLE
POLICY AND/OR (C) THAT ARE NECESSARY IN ORDER TO EFFECTUATE THE TRANSFER OF THE
PREMISES AS CONTEMPLATED BY THIS AGREEMENT (X) IN ACCORDANCE WITH THE TERMS OF
THIS AGREEMENT OR (Y) PURSUANT TO ANY APPLICABLE LAW, RULE OR REGULATION.

 

14.                                                         DEFAULT.

 

(A)                                  BUYER
DEFAULT.                                         IF BUYER BREACHES OR FAILS TO
PERFORM ITS OBLIGATION TO PURCHASE THE PROPERTY UNDER THIS

 

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AGREEMENT AFTER THE EXPIRATION OF THE INSPECTION PERIOD AND THIS AGREEMENT IS
TERMINATED (OR THE CLOSING FAILS TO OCCUR) AS A RESULT OF SUCH FAILURE (AND NOT
AS A RESULT OF SELLER’S BREACH), THEN THE DEPOSIT SHALL BE IMMEDIATELY DELIVERED
BY ESCROWEE TO SELLER AS LIQUIDATED DAMAGES AND NOT AS A PENALTY.  THE RETENTION
OF THE DEPOSIT SHALL BE SELLER’S SOLE REMEDY IN THE EVENT OF BUYER’S DEFAULT AT
OR PRIOR TO THE CLOSING DATE, AND SELLER IN SUCH EVENT HEREBY WAIVES ANY RIGHT
TO RECOVER THE BALANCE OF THE PURCHASE PRICE.  SELLER AND BUYER AGREE THAT THE
ACTUAL DAMAGES TO SELLER IN THE EVENT OF SUCH BREACH ARE IMPRACTICAL TO
ASCERTAIN AS OF THE DATE OF THIS AGREEMENT AND THE AMOUNT OF THE DEPOSIT IS A
REASONABLE ESTIMATE THEREOF.  UPON PAYMENT OF THE DEPOSIT TO SELLER AS
LIQUIDATED DAMAGES, THIS AGREEMENT SHALL (EXCEPT AS HEREIN OTHERWISE EXPRESSLY
PROVIDED) BE AND BECOME NULL AND VOID.  NOTHING CONTAINED IN THIS PARAGRAPH
14(A) SHALL BE DEEMED TO LIMIT SELLER’S RIGHTS AGAINST BUYER BY REASON OF THE
INDEMNITY OBLIGATIONS OF BUYER TO SELLER SET FORTH IN THIS AGREEMENT (ALL OF
WHICH SHALL SURVIVE THE TERMINATION OF THIS AGREEMENT), NOR LIMIT SELLER’S
RECOVERY AGAINST BUYER FOR ATTORNEYS’ FEES AND COSTS INCURRED BY SELLER IN
CONNECTION WITH SELLER’S EXERCISE OF ITS RIGHTS UNDER THIS AGREEMENT.  THE
PAYMENT OF THE DEPOSIT AS LIQUIDATED DAMAGES IS NOT INTENDED AS A FORFEITURE OR
PENALTY WITHIN THE MEANING OF CALIFORNIA CIVIL CODE SECTIONS 3275 OR 3369, BUT
IS INTENDED TO CONSTITUTE LIQUIDATED DAMAGES TO SELLER PURSUANT TO CALIFORNIA
CIVIL CODE SECTIONS 1671, 1676 AND 1677.  SELLER HEREBY WAIVES THE PROVISIONS OF
CALIFORNIA CIVIL CODE SECTION 3389.

 

SELLER AND BUYER ACKNOWLEDGE THAT THEY HAVE READ AND UNDERSTAND THE PROVISIONS
OF THIS SECTION, AND BY THEIR INITIALS IMMEDIATELY BELOW AGREE TO BE BOUND BY
ITS TERMS.

 

 

 

/s/

TG

 

 

/s/ CH

 

 

 

 

BUYER

 

 

SELLER

 

 

(B)                                 SELLER DEFAULT.  THE TERM “PERMITTED EVENT”
SHALL MEAN THE OCCURRENCE OF ALL OF THE FOLLOWING ON THE CLOSING DATE: 
(1) BUYER SHALL BE READY, WILLING AND ABLE TO COMPLETE CLOSING IN ACCORDANCE
WITH THIS AGREEMENT, AND (2) SELLER, NOTWITHSTANDING THE FOREGOING, SHALL HAVE
REFUSED TO COMPLETE CLOSING IN ACCORDANCE WITH THIS AGREEMENT AND SUCH REFUSAL
CONSTITUTED A DEFAULT ON THE PART OF SELLER UNDER THIS AGREEMENT.  EXCEPT UPON
THE OCCURRENCE OF A PERMITTED EVENT, BUYER AGREES THAT IT SHALL NOT (AND HEREBY
WAIVES ANY RIGHT TO) COMMENCE OR MAINTAIN ANY ACTION AGAINST SELLER FOR SPECIFIC
PERFORMANCE UNDER THIS AGREEMENT OR FOR A DECLARATORY JUDGMENT AS TO BUYER’S
RIGHTS UNDER THIS AGREEMENT.  BUYER FURTHER WAIVES ANY RIGHT TO FILE OR ASSERT
ANY LIS PENDENS AGAINST ANY PORTION OF THE PREMISES EXCEPT IN CONNECTION WITH AN
ACTION FOR SPECIFIC PERFORMANCE COMMENCED AND MAINTAINED BY BUYER IN ACCORDANCE
WITH THIS PARAGRAPH.  IF THE ONLY REASON THE SALE OF THE PREMISES IS NOT
CONSUMMATED IS BECAUSE OF THE OCCURRENCE OF THE PERMITTED EVENT, THEN AS ITS
SOLE AND EXCLUSIVE REMEDY, BUYER MAY EITHER (I) TERMINATE THIS AGREEMENT IN ITS
ENTIRETY BY DELIVERY OF NOTICE OF TERMINATION TO SELLER, WHEREUPON THE DEPOSIT

 

14

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SHALL BE IMMEDIATELY RETURNED TO BUYER (IN WHICH CASE BUYER SHALL ALSO BE
ENTITLED TO REIMBURSEMENT FOR OUT-OF-POCKET DUE DILIGENCE COSTS AND ATTORNEYS’
FEES REASONABLY INCURRED BY BUYER IN CONNECTION WITH THIS AGREEMENT, UP TO A
MAXIMUM REIMBURSEMENT OF THIRTY FIVE THOUSAND AND 00/100 DOLLARS ($35,000.00)),
OR (II) CONTINUE THIS AGREEMENT PENDING BUYER’S ACTION FOR SPECIFIC PERFORMANCE
HEREUNDER PROVIDED APPROPRIATE PROCEEDINGS ARE COMMENCED BY BUYER NO LATER THAN
THIRTY (30) DAYS AFTER THE CLOSING DATE ORIGINALLY SCHEDULED HEREUNDER AND
PROSECUTED WITH DILIGENCE AND CONTINUITY.  NOTWITHSTANDING THE FOREGOING OR
ANYTHING SET FORTH HEREIN TO THE CONTRARY, (X) THE NON-SATISFACTION OF THE
CLOSING CONDITION SET FORTH IN SECTIONS 12(A)(I) SHALL NOT BE DEEMED TO BE A
DEFAULT BY SELLER HEREUNDER EXCEPT TO THE EXTENT CAUSED BY SELLER’S FAILURE TO
PERFORM ITS OBLIGATION TO CURE MANDATORY CURE LIENS OR ANY CONSENSUAL MORTGAGE
OR DEED OF TRUST WHICH HAVE BEEN EXECUTED BY SELLER, AND (Y) IN THE EVENT OF A
FAILURE OF ANY SUCH CLOSING CONDITIONS, BUYER’S SOLE AND EXCLUSIVE REMEDY SHALL
BE TO TERMINATE THIS AGREEMENT IN ITS ENTIRETY BY DELIVERY OF NOTICE OF
TERMINATION TO SELLER, WHEREUPON THE DEPOSIT SHALL BE IMMEDIATELY RETURNED TO
BUYER.

 

15.                                                         NOTICES; COMPUTATION
OF PERIODS.  (A)  NOTICES.  ALL NOTICES GIVEN BY EITHER PARTY TO THE OTHER SHALL
BE IN WRITING AND SHALL BE SENT EITHER (I) BY UNITED STATES POSTAL SERVICE
REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID, RETURN RECEIPT REQUESTED, OR
(II) BY PREPAID NATIONALLY RECOGNIZED OVERNIGHT COURIER SERVICE FOR NEXT
BUSINESS DAY DELIVERY, ADDRESSED TO THE OTHER PARTY AT THE FOLLOWING ADDRESSES
LISTED BELOW OR (III) VIA TELECOPIER OR FACSIMILE TRANSMISSION TO THE FACSIMILE
NUMBERS LISTED BELOW; PROVIDED, HOWEVER, THAT IF SUCH COMMUNICATION IS GIVEN VIA
TELECOPIER OR FACSIMILE TRANSMISSION, AN ORIGINAL COUNTERPART OF SUCH
COMMUNICATION SHALL CONCURRENTLY BE SENT IN THE MANNER SPECIFIED IN SUBPARAGRAPH
(II) ABOVE.  ADDRESSES AND FACSIMILE NUMBERS OF THE PARTIES ARE AS FOLLOWS:

 

As to Buyer:

 

Catalyst Semiconductor, Inc.

1250 Borregas Avenue

Sunnyvale, California 94089

Telecopy:  (408) 542-1410

Attention:  Mr. Tom Gay

 

With copies at the same time to:

 

Wilson Sonsini Goodrich & Rosati

650 Page Mill Road

Palo Alto, California 94304-1050

Telecopy:  (650) 493-6811

Attention:  Marc Gottschalk, Esq.

 

As to Seller:

 

2975 Stender Associates LLC

825 Third Avenue, 36th Floor

New York, New York 10022

Telecopy:  (212) 224-5699

 

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Attention:       Mr. Christopher Hughes
Mr. Scott Schonfeld

 

With copies at the same time to:

 

The Praedium Group, LLC

825 Third Avenue, 36th Floor

New York, New York 10022

Telecopy:  (212) 224-5699

Attention:  Laura A. Schaffer, Esq.

 

And to:

 

South Bay Development

1690 Dell Avenue

Campbell, California 95008

Attention:  Mr. David Andris

Fax:  (408) 379-3229

 

And to:

 

Manatt, Phelps & Phillips, LLP

11355 West Olympic Boulevard

Los Angeles, California 90064

Telecopy:  (310) 914-5758

Attention:  Valentin G. Aguilar II, Esq.

 

As to Title Company or Escrowee:

 

First American Title Company

1737 North First Street

San Jose, California  95112-4505

Attention:  Ms. Liz Zankich

Fax No.:  (408) 579-8319

 

or to such other address as the respective parties may hereafter designate by
notice in writing in the manner specified above.  Any notice may be given on
behalf of any party by its counsel.  Notices given in the manner aforesaid shall
be deemed sufficiently served or given for all purposes under this Agreement
upon actual receipt (including receipt of a facsimile copy, but only if an
original of such facsimile is properly sent by overnight courier as provided
above) or refusal by the addressee.

 

(B)  COMPUTATION OF PERIODS.  IF THE FINAL DAY OF ANY PERIOD OF TIME IN ANY
PROVISION OF THIS AGREEMENT FALLS UPON A SATURDAY, SUNDAY OR A HOLIDAY OBSERVED
BY FEDERALLY INSURED BANKS IN THE STATE OF NEW YORK AND/OR THE STATE IN WHICH
THE PREMISES IS LOCATED OR BY THE UNITED STATES POSTAL SERVICE (ANY OF THE
FOREGOING, A “HOLIDAY”), THEN, THE TIME OF SUCH PERIOD SHALL BE EXTENDED TO THE
NEXT DAY WHICH IS NOT A SATURDAY, SUNDAY OR HOLIDAY.  UNLESS OTHERWISE
SPECIFIED, IN COMPUTING ANY PERIOD OF TIME DESCRIBED IN THIS AGREEMENT, THE DAY
OF THE ACT OR EVENT AFTER WHICH THE DESIGNATED PERIOD OF TIME BEGINS TO RUN IS
NOT TO BE INCLUDED AND THE

 

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LAST DAY OF THE PERIOD IS SO COMPUTED IS TO BE INCLUDED, UNLESS SUCH LAST DAY IS
A SATURDAY, SUNDAY OR HOLIDAY IN WHICH EVENT THE PERIOD SHALL RUN UNTIL THE END
OF THE NEXT DAY WHICH IS NEITHER A SATURDAY, SUNDAY OR HOLIDAY.  AS USED IN THIS
AGREEMENT, THE PHRASE “BUSINESS DAY” MEANS ANY DAY THAT IS NOT A SATURDAY,
SUNDAY OR HOLIDAY.

 

16.                                                         FIRE OR OTHER
CASUALTY.

 

(A)  CASUALTY INSURANCE.  SELLER AGREES TO MAINTAIN IN EFFECT UNTIL THE CLOSING
DATE THE FIRE AND OTHER CASUALTY INSURANCE POLICIES NOW IN EFFECT ON THE
PREMISES (OR SUBSTITUTE POLICIES IN EQUAL OR GREATER AMOUNTS).

 

(B)  CASUALTY DAMAGE.  IF ANY PORTION OF THE PREMISES SHALL BE DAMAGED OR
DESTROYED BY FIRE OR OTHER CASUALTY BETWEEN THE DATE OF THIS AGREEMENT AND THE
CLOSING DATE, SELLER SHALL GIVE WRITTEN NOTICE THEREOF TO BUYER.  SUBJECT TO THE
PROVISIONS OF SUBPARAGRAPH (C) BELOW, THE OBLIGATION OF BUYER TO COMPLETE
CLOSING UNDER THIS AGREEMENT SHALL IN NO WAY BE VOIDED OR IMPAIRED BY REASON
THEREOF, AND BUYER SHALL BE REQUIRED TO ACCEPT THE PREMISES AND THE PERSONAL
PROPERTY IN THEIR THEN DAMAGED CONDITION WITHOUT ABATEMENT OF THE PURCHASE PRICE
OR ANY CLAIM AGAINST SELLER.  IN SUCH CASE, THE PROCEEDS OF ALL FIRE AND
EXTENDED COVERAGE INSURANCE POLICIES ATTRIBUTABLE TO SUCH DAMAGE OR DESTRUCTION
AT THE PREMISES OR THE PERSONAL PROPERTY RECEIVED BY SELLER PRIOR TO THE CLOSING
DATE (AND NOT USED BY SELLER FOR THE PROTECTION OR REPAIRS TO THE PREMISES AND
THE PERSONAL PROPERTY) SHALL BE DISBURSED BY SELLER TO BUYER AT CLOSING; AND ALL
UNPAID CLAIMS UNDER SUCH INSURANCE POLICIES ATTRIBUTABLE TO SUCH DAMAGE OR
DESTRUCTION AT THE PREMISES AND PERSONAL PROPERTY SHALL BE ASSIGNED BY SELLER TO
BUYER ON THE DATE OF CLOSING.  IN ANY EVENT, IF SUCH PROCEEDS RELATE TO A FIRE
OR CASUALTY THAT OCCURS BETWEEN THE EXPIRATION OF THE INSPECTION PERIOD AND THE
CLOSING DATE (AND PROVIDED THAT BUYER IS NOT IN DEFAULT HEREUNDER AND THIS
AGREEMENT HAS NOT YET BEEN TERMINATED), THEN SELLER SHALL NOT USE SUCH PROCEEDS
WITHOUT THE PRIOR CONSENT OF BUYER (WHICH CONSENT SHALL NOT BE UNREASONABLY
WITHHELD OR DELAYED).  THERE SHALL BE NO REDUCTION IN THE PURCHASE PRICE BY
REASON OF ANY SUCH UNPAID CLAIM EXCEPT THAT AT THE CLOSING, BUYER SHALL RECEIVE
A CREDIT EQUAL TO ANY DEDUCTIBLES UNDER SUCH INSURANCE POLICIES TO THE EXTENT
SUCH DEDUCTIBLES HAVE NOT YET BEEN PAID OR OTHERWISE INCURRED BY SELLER.

 

(C)                                  RIGHT OF TERMINATION.  NOTWITHSTANDING ANY
OF THE PRECEDING PROVISIONS OF THIS PARAGRAPH 16, IF “SUBSTANTIAL DAMAGE” (AS
DEFINED BELOW) SHALL OCCUR TO THE BUILDINGS ON THE PREMISES BY FIRE OR OTHER
CASUALTY PRIOR TO THE CLOSING DATE, BUYER SHALL HAVE THE RIGHT TO TERMINATE THIS
AGREEMENT BY WRITTEN NOTICE TO THE SELLER.  IF BUYER DESIRES TO TERMINATE THIS
AGREEMENT PURSUANT TO THIS SUBPARAGRAPH (C), BUYER MUST GIVE A WRITTEN NOTICE OF
TERMINATION TO SELLER WITHIN FIFTEEN (15) BUSINESS DAYS AFTER SELLER’S NOTICE TO
BUYER OF THE OCCURRENCE OF THE CASUALTY.  UPON SUCH TERMINATION OF THIS
AGREEMENT, THE DEPOSIT SHALL BE RETURNED TO BUYER AND NEITHER PARTY SHALL HAVE
ANY FURTHER RIGHTS OR OBLIGATIONS HEREUNDER (EXCEPT THE INDEMNITY OBLIGATIONS OF
BUYER TO SELLER SET FORTH IN THIS AGREEMENT WHICH SHALL SURVIVE THE TERMINATION
OF THIS AGREEMENT AND EXCEPT FOR ANY DEFAULT BY BUYER WHICH MAY HAVE OCCURRED
PRIOR THERETO).  THE TERM “SUBSTANTIAL DAMAGE” SHALL MEAN SUCH DAMAGE THAT WOULD
COST, IN THE JUDGMENT OF AN INDEPENDENT THIRD-PARTY REAL ESTATE PROFESSIONAL
RETAINED BY SELLER, AT LEAST THREE HUNDRED FIFTY THOUSAND AND 00/100 DOLLARS
($350,000.00) TO REPAIR.  IF BUYER DOES NOT TIMELY GIVE NOTICE OF A TERMINATION,
BUYER’S OBLIGATIONS HEREUNDER SHALL REMAIN IN EFFECT NOTWITHSTANDING SUCH
CASUALTY AND BUYER SHALL REMAIN OBLIGATED TO CONSUMMATE THE PURCHASE IN
ACCORDANCE WITH THE TERMS OF THIS AGREEMENT, INCLUDING, WITHOUT LIMITATION,
SUBPARAGRAPH (B) ABOVE.

 

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17.                                                         CONDEMNATION.

 

(A)                                  IMMATERIAL TAKING.  IF ANY PART OF THE
PREMISES SHALL BE TAKEN BY EXERCISE OF THE POWER OF EMINENT DOMAIN AFTER THE
DATE OF THIS AGREEMENT THAT DOES NOT MATERIALLY INTERFERE WITH THE USE OF THE
PREMISES FOR THE PURPOSES FOR WHICH IT IS CURRENTLY USED, THIS AGREEMENT SHALL
CONTINUE IN FULL FORCE AND EFFECT AND THERE SHALL BE NO ABATEMENT OF THE
PURCHASE PRICE.  SELLER SHALL BE RELIEVED, HOWEVER, OF ITS DUTY TO CONVEY TITLE
TO THE PORTION OF THE PARCEL SO TAKEN, BUT SELLER SHALL, ON THE CLOSING DATE,
ASSIGN TO BUYER ALL RIGHTS AND CLAIMS TO ANY AWARDS ARISING THEREFROM AS WELL AS
ANY MONEY THERETOFORE RECEIVED BY SELLER ON ACCOUNT THEREOF, NET OF ANY EXPENSES
ACTUALLY INCURRED BY SELLER, INCLUDING ATTORNEY’S FEES OF COLLECTING THE SAME. 
SELLER SHALL PROMPTLY FURNISH BUYER WITH A COPY OF THE DECLARATION OF TAKING
PROPERTY AFTER SELLER’S RECEIPT THEREOF.

 

(B)                                 MATERIAL TAKING.  IF ANY TAKING OF A PORTION
OF THE PREMISES MATERIALLY INTERFERES WITH THE USE OF THE PREMISES FOR THE
PURPOSES FOR WHICH IT IS CURRENTLY USED OR MATERIALLY REDUCE THE SQUARE FOOTAGE
OF THE PREMISES (INCLUDING THE PARKING AREAS), BUYER MAY TERMINATE THIS
AGREEMENT, BY WRITTEN NOTICE TO SELLER WITHIN FIFTEEN (15) BUSINESS DAYS OF
SELLER’S NOTICE TO BUYER OF SUCH A TAKING.  UPON THE GIVING OF SUCH TERMINATION
NOTICE, THE DEPOSIT SHALL BE RETURNED TO BUYER AND THIS AGREEMENT SHALL BECOME
NULL AND VOID, EXCEPT FOR THE INDEMNITY OBLIGATIONS OF BUYER TO SELLER SET FORTH
IN THIS AGREEMENT WHICH WILL SURVIVE TERMINATION OF THIS AGREEMENT.  IF BUYER
DOES NOT TIMELY GIVE NOTICE OF TERMINATION, BUYER’S OBLIGATIONS HEREUNDER SHALL
REMAIN IN EFFECT NOTWITHSTANDING SUCH CONDEMNATION AND BUYER SHALL REMAIN
OBLIGATED TO CONSUMMATE THE PURCHASE IN ACCORDANCE WITH THE TERMS OF THIS
AGREEMENT.

 

18.                                                         ASSIGNABILITY.

 

(A)  ASSIGNMENTS PROHIBITED.   BUYER MAY NOT ASSIGN OR SUFFER AN ASSIGNMENT OF
THIS AGREEMENT AND/OR ITS RIGHTS UNDER THIS AGREEMENT, WITHOUT THE PRIOR WRITTEN
CONSENT OF SELLER, WHICH CONSENT SELLER MAY DENY IN ITS SOLE AND ABSOLUTE
DISCRETION.  ANY SUCH ASSIGNMENT MADE WITHOUT SUCH PRIOR WRITTEN CONSENT SHALL
BE DEEMED VOIDABLE AND BREACH OF THIS AGREEMENT ENTITLING SELLER TO TERMINATE
THIS AGREEMENT.  NOTWITHSTANDING THE FOREGOING, BUYER SHALL HAVE THE RIGHT, UPON
REASONABLE ADVANCE NOTICE TO SELLER, TO ASSIGN THIS AGREEMENT OR ITS RIGHTS
HEREUNDER TO ANY ENTITY THAT CONTROLS, IS CONTROLLED BY OR IS UNDER COMMON
CONTROL, DIRECTLY OR INDIRECTLY WITH BUYER OR BUYER’S MANAGER, IN EACH CASE
WITHOUT THE SELLER’S CONSENT; PROVIDED, HOWEVER, THAT NO ASSIGNMENT BY BUYER
SHALL BE EFFECTIVE, HOWEVER, UNLESS AND UNTIL BUYER SHALL HAVE FURNISHED TO
SELLER BOTH A FULLY EXECUTED COPY OF THE ASSIGNMENT AND ASSUMPTION AGREEMENT, IN
FORM REASONABLY SATISFACTORY TO SELLER, BY THE ASSIGNEE TO ASSUME, PERFORM AND
BE RESPONSIBLE, JOINTLY AND SEVERALLY WITH THE BUYER NAMED HEREIN, FOR THE
PERFORMANCE OF ALL OF THE OBLIGATIONS OF BUYER UNDER THIS AGREEMENT AND TO PAY
ALL ADDITIONAL TRANSFER OR DOCUMENTARY TAXES IMPOSED AS A RESULT OF SUCH
ASSIGNMENT, AND WHICH CONTAINS A REPRESENTATION BY THE ASSIGNEE THAT ALL OF THE
REPRESENTATIONS AND WARRANTIES MADE BY BUYER IN THIS AGREEMENT ARE TRUE AND
CORRECT WITH RESPECT TO THE ASSIGNEE AS OF THE DATE OF THE ASSUMPTION AGREEMENT,
TOGETHER WITH ADDITIONAL AUTHORITY, DUE FORMATION, DUE EXECUTION AND DELIVERY
REPRESENTATIONS AS REASONABLY DETERMINED BY SELLER.  IN NO EVENT SHALL BUYER BE
RELIEVED OF ANY LIABILITY HEREUNDER BY REASON OF AN ASSIGNMENT OF ITS RIGHTS
HEREUNDER AND THE EXPRESS TERMS OF ANY ASSIGNMENT BY BUYER SHALL REAFFIRM
BUYER’S OBLIGATIONS HEREUNDER; PROVIDED, HOWEVER, THAT IF THE CLOSING OCCURS IN
ACCORDANCE WITH THE PROVISIONS OF THIS AGREEMENT, THEN SO LONG AS BUYER’S
ASSIGNEE HAS FULLY ASSUMED ALL PAST, PRESENT AND FUTURE OBLIGATIONS OF BUYER
HEREUNDER, BUYER SHALL BE RELEASED FROM FURTHER LIABILITY HEREUNDER EFFECTIVE
UPON THE CLOSING.

 

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(B)  PROHIBITED ASSIGNMENTS.  NOTWITHSTANDING THE FOREGOING PROVISIONS OF
SUBPARAGRAPH (A), BUYER SHALL HAVE NO RIGHT, UNDER ANY CIRCUMSTANCES, TO ASSIGN
THIS AGREEMENT (I) TO ANY ENTITY OWNED OR CONTROLLED BY AN EMPLOYEE BENEFIT PLAN
IF SELLER’S SALE OF THE PREMISES TO SUCH ENTITY WOULD, IN THE REASONABLE
JUDGMENT OF SELLER OR SELLER’S COUNSEL, EITHER CREATE, OTHERWISE CAUSE, OR RAISE
A MATERIAL QUESTION AS TO WHETHER IT WOULD CREATE OR OTHERWISE CAUSE, A
“PROHIBITED TRANSACTION” UNDER ERISA OR (II) TO ANY PERSON, OR TO ANY ENTITY
WHICH HAS AS A DIRECT OR INDIRECT OWNER OR PARTIAL OWNER A PERSON WITH A
CRIMINAL RECORD, OR CURRENTLY UNDER A CRIMINAL INDICTMENT.

 

(C)  SUCCESSORS AND ASSIGNS.  SUBJECT TO THE FOREGOING LIMITATIONS, THIS
AGREEMENT SHALL EXTEND TO, AND SHALL BIND, THE RESPECTIVE HEIRS, EXECUTORS,
PERSONAL REPRESENTATIVES, SUCCESSORS AND ASSIGNS OF SELLER AND BUYER.

 

19.                                                        
INSPECTIONS/INSPECTION PERIOD.

 

(A)  RIGHT TO INSPECT.  BUYER, AND BUYER’S AGENTS AND REPRESENTATIVES, SHALL
HAVE THE RIGHT, FROM TIME TO TIME, PRIOR TO THE EXPIRATION OF THE INSPECTION
PERIOD OR EARLIER TERMINATION OF THIS AGREEMENT, DURING NORMAL BUSINESS HOURS,
TO ENTER UPON THE PREMISES FOR THE PURPOSE OF CONDUCTING VISUAL INSPECTIONS OF
THE PREMISES, EXAMINING THE STRUCTURE OF THE BUILDING, TESTING OF MACHINERY AND
EQUIPMENT, TAKING OF MEASUREMENTS, MAKING OF SURVEYS AND GENERALLY FOR THE
REASONABLE ASCERTAINMENT OF MATTERS RELATING TO THE PREMISES.  IN CONNECTION
WITH BUYER’S INSPECTION, BUYER SHALL (I) GIVE SELLER PRIOR WRITTEN NOTICE OF THE
TIME AND PLACE OF SUCH ENTRY NOT LESS THAN 48 HOURS PRIOR TO THE PROPOSED DATE
AND TIME OF ENTRY; (II) USE REASONABLY DILIGENT EFFORTS NOT TO INTERFERE WITH
THE OPERATIONS OF THE PREMISES OR ANY TENANT THEREOF; (III) RESTORE ANY DAMAGE
TO THE PREMISES OR ANY ADJACENT PROPERTY CAUSED BY SUCH ACTIONS (PROVIDED THAT
BUYER SHALL NOT BE RESPONSIBLE FOR ANY DAMAGE DIRECTLY ARISING FROM THE MERE
DISCOVERY OF A PRE-EXISTING CONDITION); (IV) INDEMNIFY, DEFEND AND SAVE SELLER
AND, AS THE CASE MAY BE, ITS PARTNERS, TRUSTEES, SHAREHOLDERS, DIRECTORS,
MEMBERS, OFFICERS, EMPLOYEES, AGENTS AND OTHER REPRESENTATIVES HARMLESS OF AND
FROM ANY AND ALL CLAIMS AND/OR LIABILITIES WHICH SELLER AND ITS PARTNERS,
TRUSTEES, SHAREHOLDERS, DIRECTORS, MEMBERS, OFFICERS, EMPLOYEES, AGENTS AND
OTHER REPRESENTATIVES MAY SUFFER OR BE SUBJECT BY REASON OF OR IN ANY MANNER
RELATING TO SUCH ENTRY AND SUCH ACTIVITIES, INCLUDING, WITHOUT LIMITATION, ANY
CLAIMS BY TENANTS AND/OR INVITEES OF THE PREMISES; (V) SELLER AND SELLER’S
REPRESENTATIVES SHALL HAVE THE RIGHT TO ACCOMPANY BUYER OR BUYER’S AGENT IN THE
EVENT BUYER ENTERS INTO ANY PORTION OF THE PREMISES (INCLUDING ANY TENANT’S
PREMISES) OR COMMUNICATES WITH OR INTERVIEWS ANY TENANT; (VI) PRIOR TO ENTRY
ONTO THE PREMISES, FURNISH SELLER WITH A CERTIFICATE OF GENERAL LIABILITY AND
PROPERTY DAMAGE INSURANCE MAINTAINED BY BUYER WITH SINGLE OCCURRENCE COVERAGE OF
AT LEAST $1,000,000 AND NAMING SELLER AND ITS PROPERTY MANAGER AS ADDITIONAL
INSUREDS; AND (VI) NOT CONDUCT ANY “PHASE II” ENVIRONMENTAL SITE ASSESSMENTS OR
INVASIVE, DESTRUCTIVE, DRILLING OR CORING PROCEDURES OR TESTS WITHOUT THE PRIOR
CONSENT OF SELLER (WHICH CONSENT SELLER MAY WITHHOLD IN ITS SOLE AND ABSOLUTE
DISCRETION), AND NOT CONDUCT ANY OTHER ENVIRONMENTAL INVESTIGATIONS OR TESTING
WITHOUT THE PRIOR CONSENT OF SELLER (WHICH CONSENT SHALL NOT BE UNREASONABLY
WITHHELD).  SELLER SHALL GIVE BUYER, AND ITS COUNSEL, ACCOUNTANTS, AND
REPRESENTATIVES REASONABLE ACCESS TO THE BOOKS, RECORDS, SURVEY PLANS, DOCUMENTS
AND INFORMATION (OTHER THAN INTERNAL MEMORANDA, APPRAISALS, AND DOCUMENTS AND/OR
INFORMATION COVERED BY THE ATTORNEY-CLIENT PRIVILEGE OR WORK-PRODUCT PRIVILEGE,
OR OTHER DOCUMENTS DEEMED IN GOOD FAITH BY SELLER TO BE CONFIDENTIAL) FOR REVIEW
AND COPYING IN THE POSSESSION OF SELLER OR SELLER’S PROPERTY MANAGER WITH
RESPECT TO OWNERSHIP, CONSTRUCTION AND OPERATION OF THE PREMISES.

 

19

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(B)  NO LIENS PERMITTED.  NOTHING CONTAINED IN THIS AGREEMENT SHALL BE DEEMED OR
CONSTRUED IN ANY WAY AS CONSTITUTING THE CONSENT OR REQUEST OF SELLER, EXPRESS
OR IMPLIED BY INFERENCE OR OTHERWISE, TO ANY PARTY FOR THE PERFORMANCE OF ANY
LABOR OR THE FURNISHING OF ANY MATERIALS TO THE PREMISES OR ANY PART THEREOF,
NOR AS GIVING BUYER ANY RIGHT, POWER OR AUTHORITY TO CONTRACT FOR OR PERMIT THE
RENDERING OF ANY SERVICES OR THE FURNISHING OF ANY MATERIALS THAT WOULD GIVE
RISE TO THE FILING OF ANY LIENS AGAINST THE PREMISES OR ANY PART THEREOF.  BUYER
AGREES TO PROMPTLY CAUSE THE REMOVAL OF, AND INDEMNIFY, DEFEND AND HOLD SELLER
HARMLESS WITH RESPECT TO, ANY MECHANIC’S OR SIMILAR LIEN FILED AGAINST THE
PREMISES OR ANY PART THEREOF BY ANY PARTY PERFORMING ANY LABOR OR SERVICES AT
THE PREMISES OR SUPPLYING ANY MATERIALS TO THE PREMISES AT BUYER’S REQUEST.

 

(C)  BUYER’S RIGHT OF TERMINATION. IF BUYER DETERMINES, IN ITS SOLE AND ABSOLUTE
DISCRETION, THAT IT IS NOT SATISFIED WITH THE PREMISES AND ALL OR ANY MATTERS
RELATING THERETO AS A RESULT OF BUYER’S INSPECTION (INCLUDING, WITHOUT
LIMITATION, ANY TITLE MATTERS), BUYER SHALL HAVE THE RIGHT TO TERMINATE THIS
AGREEMENT, FOR ANY OR NO REASON WHATSOEVER, BY GIVING SELLER WRITTEN NOTICE
(“TERMINATION NOTICE”) AT ANY TIME PRIOR TO THE EXPIRATION OF THE INSPECTION
PERIOD.  UPON GIVING THE TERMINATION NOTICE, THIS AGREEMENT SHALL IMMEDIATELY
TERMINATE (EXCEPT FOR THE INDEMNITY AND OTHER OBLIGATIONS OF BUYER TO SELLER
UNDER THIS AGREEMENT WHICH ARE PROVIDED HEREUNDER TO SURVIVE THE TERMINATION OF
THIS AGREEMENT) AND WITHOUT FURTHER NOTICE OR INSTRUCTION, THE DEPOSIT SHALL BE
RETURNED BY ESCROWEE TO BUYER, AS BUYER’S SOLE AND EXCLUSIVE REMEDY UNDER THIS
AGREEMENT, AT LAW OR IN EQUITY.  IN ANY EVENT AND NOTWITHSTANDING ANYTHING IN
THIS AGREEMENT THAT MAY BE CONSTRUED TO THE CONTRARY, BUYER’S FAILURE TO DELIVER
THE TERMINATION NOTICE PRIOR TO THE EXPIRATION OF THE INSPECTION PERIOD SHALL BE
DEEMED BUYER’S WAIVER OF ITS TERMINATION RIGHT UNDER THIS PARAGRAPH 19 (IN WHICH
EVENT, BUYER SHALL BE DEEMED TO HAVE CONSENTED TO AND APPROVED OF EVERY FACT,
ITEM AND CONDITION RELATING TO THE PROPERTY INCLUDING, WITHOUT LIMITATION, ALL
ENCUMBRANCES AND OTHER TITLE EXCEPTIONS CONTAINED IN THE TITLE REPORT AND ALL
MATTERS SET FORTH IN OR ILLUSTRATED BY THE SURVEY PLAN).

 

(D)  SURVIVAL.  THE PROVISIONS OF THIS PARAGRAPH 19 SHALL SURVIVE TERMINATION OF
THIS AGREEMENT AND/OR THE CLOSING AND DELIVERY OF THE DEED.

 

20.                                                         BROKERS.  SELLER AND
BUYER EACH REPRESENTS AND WARRANTS TO THE OTHER THAT IT HAS DEALT WITH NO BROKER
OR OTHER INTERMEDIARY IN CONNECTION WITH THIS TRANSACTION OTHER THAN WAYNE
MASCIA ASSOCIATES, WHO REPRESENTS THE BUYER (THE “BUYER’S BROKER”).  CONTINGENT
UPON THE OCCURRENCE OF THE CLOSING, SELLER AGREES TO PAY A COMMISSION TO BUYER’S
BROKER IN AN AMOUNT NOT TO EXCEED THE LESSER OF (I) THREE PERCENT (3%) OF THE
PURCHASE PRICE PAYABLE HEREUNDER AT CLOSING, OR (II) ONE HUNDRED ELEVEN THOUSAND
AND 00/100 DOLLARS ($111,000.00) IF, AS AND WHEN THE CLOSING OCCURS ONLY. 
NOTWITHSTANDING THE FOREGOING, IF ANY BROKER OR OTHER INTERMEDIARY OTHER THAN
THE BUYER’S BROKER CLAIMS TO BE ENTITLED TO A FEE OR COMMISSION BY REASON OF
HAVING DEALT WITH SELLER OR BUYER IN CONNECTION WITH THIS TRANSACTION, OR HAVING
INTRODUCED THE PREMISES TO BUYER FOR SALE, OR HAVING BEEN THE INDUCING CAUSE TO
THE SALE, THE PARTY WITH WHOM SUCH BROKER CLAIMS TO HAVE DEALT SHALL INDEMNIFY,
DEFEND AND SAVE HARMLESS THE OTHER PARTY OF AND FROM ANY CLAIM FOR COMMISSION OR
COMPENSATION BY SUCH BROKER OR OTHER INTERMEDIARY.  THIS PARAGRAPH 20 SHALL
SURVIVE THE TERMINATION OF THIS AGREEMENT AND/OR THE CLOSING AND DELIVERY OF THE
DEED.

 

21.                                                         CONDITION OF
PREMISES.  (A)  NO WARRANTIES.  THE ENTIRE AGREEMENT BETWEEN THE SELLER AND
BUYER WITH RESPECT TO THE PROPERTY AND THE SALE THEREOF IS EXPRESSLY SET FORTH
IN THIS AGREEMENT.  THE PARTIES ARE NOT BOUND BY ANY AGREEMENTS, UNDERSTANDINGS,
PROVISIONS,

 

20

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CONDITIONS, REPRESENTATIONS OR WARRANTIES (WHETHER WRITTEN OR ORAL AND WHETHER
MADE BY SELLER OR ANY AGENT, EMPLOYEE, ATTORNEY, MEMBER, OFFICER OR PRINCIPAL OF
SELLER OR ANY OTHER PARTY) OTHER THAN AS ARE EXPRESSLY SET FORTH AND STIPULATED
IN THIS AGREEMENT.  WITHOUT IN ANY MANNER LIMITING THE GENERALITY OF THE
FOREGOING (BUT SUBJECT TO ANY REPRESENTATIONS AND WARRANTIES OF SELLER EXPRESSLY
SET FORTH IN THIS AGREEMENT), BUYER ACKNOWLEDGES THAT IT AND ITS REPRESENTATIVES
WILL, BY THE CLOSING, HAVE FULLY INSPECTED THE PROPERTY AND EXISTING AGREEMENTS,
OR WILL BE PROVIDED WITH AN ADEQUATE OPPORTUNITY TO DO SO, ARE OR WILL BE FULLY
FAMILIAR WITH THE FINANCIAL AND PHYSICAL (INCLUDING, WITHOUT LIMITATION,
ENVIRONMENTAL) CONDITION THEREOF, AND THAT THE PROPERTY AND EXISTING AGREEMENTS
HAVE BEEN PURCHASED BY BUYER IN AN “AS IS” AND “WHERE IS” CONDITION AND WITH ALL
EXISTING DEFECTS (PATENT AND LATENT) AS A RESULT OF SUCH INSPECTIONS AND
INVESTIGATIONS AND NOT IN RELIANCE ON ANY AGREEMENT, UNDERSTANDING, CONDITION,
WARRANTY (INCLUDING, WITHOUT LIMITATION, WARRANTIES OF HABITABILITY,
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE) OR REPRESENTATION MADE BY
SELLER OR ANY AGENT, EMPLOYEE, MEMBER, OFFICER OR PRINCIPAL OF SELLER OR ANY
OTHER PARTY (EXCEPT AS OTHERWISE EXPRESSLY ELSEWHERE PROVIDED IN THIS AGREEMENT)
AS TO THE FINANCIAL OR PHYSICAL (INCLUDING, WITHOUT LIMITATION, ENVIRONMENTAL)
CONDITION OF THE PROPERTY OR THE AREAS SURROUNDING THE PREMISES, OR AS TO ANY
OTHER MATTER WHATSOEVER, INCLUDING, WITHOUT LIMITATION, AS TO ANY PERMITTED USE
THEREOF, THE ZONING CLASSIFICATION THEREOF OR COMPLIANCE THEREOF WITH FEDERAL,
STATE OR LOCAL LAWS, AS TO THE INCOME OR EXPENSE IN CONNECTION THEREWITH, OR AS
TO ANY OTHER MATTER IN CONNECTION THEREWITH.  BUYER ACKNOWLEDGES THAT, EXCEPT AS
OTHERWISE EXPRESSLY ELSEWHERE PROVIDED IN THIS AGREEMENT, NEITHER SELLER, NOR
ANY AGENT, MEMBER, OFFICER, EMPLOYEE OR PRINCIPAL OF SELLER NOR ANY OTHER PARTY
ACTING ON BEHALF OF SELLER HAS MADE OR SHALL BE DEEMED TO HAVE MADE ANY SUCH
AGREEMENT, CONDITION, REPRESENTATION OR WARRANTY EITHER EXPRESSED OR IMPLIED. 
THIS PARAGRAPH SHALL SURVIVE CLOSING AND DELIVERY OF THE DEED, AND SHALL BE
DEEMED INCORPORATED BY REFERENCE AND MADE A PART OF ALL DOCUMENTS DELIVERED BY
SELLER TO BUYER IN CONNECTION WITH THE SALE OF THE PROPERTY.

 

(B)  CHANGE OF CONDITIONS.  SUBJECT TO SELLER’S OBLIGATIONS UNDER SUBPARAGRAPH
(D) BELOW, BUYER SHALL ACCEPT THE PREMISES AND THE PERSONAL PROPERTY AT THE TIME
OF CLOSING IN THE SAME CONDITION AS THE SAME ARE AS OF THE DATE OF THIS
AGREEMENT, AS SUCH CONDITION SHALL HAVE CHANGED BY REASON OF NORMAL WEAR AND
TEAR AND NATURAL DETERIORATION AND, SUBJECT TO PARAGRAPHS 16 AND 17 HEREOF,
CONDEMNATION OR DAMAGE BY FIRE OR OTHER CASUALTY.  WITHOUT LIMITING THE
GENERALITY OF THE FOREGOING, BUYER SPECIFICALLY ACKNOWLEDGES THAT THE FACT THAT
ANY PORTION OF THE PREMISES OR THE PERSONAL PROPERTY OR ANY EQUIPMENT OR
MACHINERY THEREIN OR ANY PART THEREOF MAY NOT BE IN WORKING ORDER OR CONDITION
AT THE

 

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CLOSING DATE BY REASON OF NORMAL WEAR AND TEAR AND NATURAL DETERIORATION OR
DAMAGE BY FIRE OR OTHER CASUALTY, OR BY REASON OF ITS PRESENT CONDITION, SHALL
NOT RELIEVE BUYER OF ITS OBLIGATION TO COMPLETE CLOSING UNDER THIS AGREEMENT AND
PAY THE FULL PURCHASE PRICE.  EXCEPT AS PROVIDED IN SUBPARAGRAPH (D) BELOW,
SELLER HAS NO OBLIGATION TO MAKE ANY REPAIRS OR REPLACEMENTS REQUIRED BY REASON
OF WEAR AND TEAR AND NATURAL DETERIORATION OR CONDEMNATION OR FIRE OR OTHER
CASUALTY, BUT MAY, AT ITS OPTION AND ITS COST (INCLUDING THE USE OF INSURANCE
PROCEEDS AS HEREIN PROVIDED), MAKE ANY SUCH REPAIRS AND REPLACEMENTS PRIOR TO
THE CLOSING DATE.

 

(C)  CONDITION OF DELIVERY.  SELLER HAS NO OBLIGATION TO DELIVER THE PREMISES IN
A “BROOM CLEAN” CONDITION, AND AT CLOSING SELLER MAY LEAVE IN THE PREMISES ALL
ITEMS OF PERSONAL PROPERTY AND EQUIPMENT, PARTITIONS AND DEBRIS AS ARE NOW
PRESENTLY THEREIN AND AS WOULD ACCUMULATE IN THE NORMAL COURSE OF OPERATING AND
MAINTAINING THE PREMISES AND THE PERSONAL PROPERTY.

 

(D)  SELLER REPAIRS.  BETWEEN THE OPENING OF ESCROW AND THE CLOSING DATE, SELLER
SHALL PERFORM ALL CUSTOMARY ORDINARY REPAIRS TO THE PREMISES AND THE PERSONAL
PROPERTY AS SELLER HAS CUSTOMARILY PREVIOUSLY PERFORMED TO MAINTAIN THEM IN
SUBSTANTIALLY THE SAME CONDITION AS THEY ARE AS OF THE OPENING OF ESCROW, AS
SAID CONDITION SHALL BE CHANGED BY WEAR AND TEAR, DAMAGE BY FIRE OR OTHER
CASUALTY.  NOTWITHSTANDING THE FOREGOING, SELLER SHALL HAVE NO OBLIGATION TO
MAKE ANY STRUCTURAL OR EXTRAORDINARY REPAIRS OR CAPITAL IMPROVEMENTS TO THE
PREMISES OR THE PERSONAL PROPERTY BETWEEN THE EFFECTIVE DATE AND CLOSING.

 

(E)  RELEASE.  BUYER, FOR ITSELF AND ITS AGENTS, AFFILIATES, SUCCESSORS AND
ASSIGNS, HEREBY RELEASES, ACQUITS AND FOREVER DISCHARGES SELLER AND (AS THE CASE
MAY BE) SELLER’S OFFICERS, DIRECTORS, MEMBERS, SHAREHOLDERS, TRUSTEES, PARTNERS,
EMPLOYEES, MANAGERS, AGENTS AND AFFILIATES (COLLECTIVELY REFERRED TO HEREIN AS
“SELLER’S PARTIES”) FROM ANY AND ALL RIGHTS, CLAIMS, DEMANDS, CAUSES OF ACTIONS,
LOSSES, DAMAGES, LIABILITIES, COSTS AND EXPENSES (INCLUDING ATTORNEYS’ FEES AND
DISBURSEMENTS WHETHER THE SUIT IS INSTITUTED OR NOT) WHETHER KNOWN OR UNKNOWN,
LIQUIDATED OR CONTINGENT (HEREINAFTER COLLECTIVELY CALLED THE “CLAIMS”), WHICH
BUYER HAS OR MAY HAVE IN THE FUTURE, ARISING FROM OR RELATING TO (I) ANY DEFECTS
(PATENT OR LATENT), ERRORS OR OMISSIONS IN THE DESIGN OR CONSTRUCTION OF THE
PREMISES WHETHER THE SAME ARE THE RESULT OF NEGLIGENCE OR OTHERWISE, OR (II) ANY
OTHER CONDITIONS, INCLUDING, WITHOUT LIMITATION, ENVIRONMENTAL AND OTHER
PHYSICAL CONDITIONS, AFFECTING THE PREMISES WHETHER THE SAME ARE A RESULT OF
NEGLIGENCE OR OTHERWISE, INCLUDING SPECIFICALLY, BUT WITHOUT LIMITATION, ANY
CLAIM FOR INDEMNIFICATION OR CONTRIBUTION ARISING UNDER THE COMPREHENSIVE
ENVIRONMENTAL RESPONSE, COMPENSATION AND LIABILITY ACT (42 U.S.C. SECTION 9601,
ET SEQ.) OR ANY OTHER FEDERAL, STATE OR LOCAL STATUTE, RULE OR ORDINANCE
RELATING TO LIABILITY OF PROPERTY OWNERS FOR ENVIRONMENTAL

 

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MATTERS, WHETHER ARISING BASED ON EVENTS THAT OCCURRED BEFORE, DURING, OR AFTER
SELLER’S PERIOD OF OWNERSHIP OF THE PROPERTY AND WHETHER BASED ON THEORIES OF
INDEMNIFICATION, CONTRIBUTION OR OTHERWISE.  THE RELEASE SET FORTH IN THIS
SECTION SPECIFICALLY INCLUDES, WITHOUT LIMITATION, ANY CLAIMS UNDER ANY
ENVIRONMENTAL LAWS OF THE UNITED STATES, THE STATE IN WHICH THE PREMISES IS
LOCATED OR ANY POLITICAL SUBDIVISION THEREOF OR UNDER THE AMERICANS WITH
DISABILITIES ACT OF 1990, AS ANY OF THOSE LAWS MAY BE AMENDED FROM TIME TO TIME
AND ANY REGULATIONS, ORDERS, RULES OF PROCEDURES OR GUIDELINES PROMULGATED IN
CONNECTION WITH SUCH LAWS, REGARDLESS OF WHETHER THEY ARE IN EXISTENCE ON THE
DATE OF THIS AGREEMENT.  AS PART OF THE PROVISIONS OF THIS SECTION 21(E), BUT
NOT AS A LIMITATION THEREON, BUYER HEREBY AGREES, REPRESENTS AND WARRANTS THAT
THE MATTERS RELEASED HEREIN ARE NOT LIMITED TO MATTERS WHICH ARE KNOWN OR
DISCLOSED, AND BUYER HEREBY WAIVES ANY AND ALL RIGHTS AND BENEFITS WHICH IT NOW
HAS, OR IN THE FUTURE MAY HAVE CONFERRED UPON IT, BY VIRTUE OF THE PROVISIONS OF
FEDERAL, STATE OR LOCAL LAW, RULES OR REGULATIONS, INCLUDING WITHOUT LIMITATION,
SECTION 1542 OF THE CIVIL CODE OF THE STATE OF CALIFORNIA, WHICH PROVIDES AS
FOLLOWS:

 

A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR
SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH
IF KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH
THE DEBTOR.

 

IN THIS CONNECTION AND TO THE EXTENT PERMITTED BY LAW, BUYER HEREBY AGREES,
REPRESENTS AND WARRANTS THAT BUYER REALIZES AND ACKNOWLEDGES THAT FACTUAL
MATTERS NOW UNKNOWN TO IT MAY HAVE GIVEN OR MAY HEREAFTER GIVE RISE TO CAUSES OF
ACTION, CLAIMS, DEMANDS, DEBTS, CONTROVERSIES, DAMAGES, COSTS, LOSSES AND
EXPENSES WHICH ARE PRESENTLY UNKNOWN, UNANTICIPATED AND UNSUSPECTED, AND BUYER
FURTHER AGREES, REPRESENTS AND WARRANTS THAT THE WAIVERS AND RELEASES HEREIN
HAVE BEEN NEGOTIATED AND AGREED UPON IN LIGHT OF THAT REALIZATION AND THAT BUYER
NEVERTHELESS HEREBY INTENDS TO RELEASE, DISCHARGE AND ACQUIT EACH OF SELLER’S
PARTIES FROM ANY SUCH UNKNOWN CAUSES OF ACTION, CLAIMS, DEMANDS, DEBTS,
CONTROVERSIES, DAMAGES, COSTS, LOSSES AND EXPENSES WHICH MIGHT IN ANY WAY BE
INCLUDED IN THE WAIVERS AND MATTERS RELEASED AS SET FORTH IN THIS
SECTION 21(e).  THE FOREGOING RELEASE, HOWEVER, DOES NOT APPLY TO THE COVENANTS
AND REPRESENTATIONS EXPRESSLY MADE BY SELLER IN THIS AGREEMENT TO THE EXTENT
SUCH COVENANTS AND REPRESENTATIONS SURVIVE THE CLOSING.  BUYER ACKNOWLEDGES THAT
BUYER HAS BEEN REPRESENTED

 

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BY INDEPENDENT LEGAL COUNSEL OF BUYER’S SELECTION AND BUYER IS GRANTING THIS
RELEASE OF ITS OWN VOLITION AND AFTER CONSULTATION WITH BUYER’S COUNSEL.  BUYER
HEREBY SPECIFICALLY ACKNOWLEDGES THAT BUYER HAS CAREFULLY REVIEWED THIS
SUBSECTION AND DISCUSSED ITS IMPORT WITH LEGAL COUNSEL AND THAT THE PROVISIONS
OF THIS SUBSECTION ARE A MATERIAL PART OF THIS AGREEMENT.

 

 

/s/ Thomas E. Gay III

 

 

Buyer

 

 

(F)  SELLER REPORTS.  BUYER ACKNOWLEDGES THAT, EXCEPT TO THE EXTENT EXPRESSLY
SET FORTH IN PARAGRAPH 9 OF THIS AGREEMENT, SELLER MAKES NO WARRANTIES OR
REPRESENTATIONS REGARDING THE ADEQUACY, ACCURACY OR COMPLETENESS OF SELLER’S
ENVIRONMENTAL AND/OR ENGINEERING REPORTS OR OTHER MATERIALS RELATING TO THE
PREMISES MADE AVAILABLE TO BUYER (COLLECTIVELY, THE “REPORTS”) OR OTHER
DOCUMENTS RELATING TO THE PREMISES, AND BUYER SHALL HAVE NO CLAIM AGAINST SELLER
BASED UPON THE REPORTS OR SUCH OTHER DOCUMENTS RELATING TO THE PREMISES.  BUYER
FURTHER ACKNOWLEDGES THAT BUYER HAS HAD FULL OPPORTUNITY TO PERFORM SUCH
PHYSICAL INSPECTIONS, ENVIRONMENTAL AND ENGINEERING INVESTIGATIONS AND
APPRAISALS AS BUYER DEEMS APPROPRIATE PRIOR TO CLOSING, AND BUYER OBTAINED OR
SHALL OBTAIN ITS OWN PHYSICAL INSPECTIONS, ENVIRONMENTAL AND ENGINEERING REPORTS
AND APPRAISALS OF THE PREMISES.

 

(G)  WAIVER OF NATURAL HAZARDS DISCLOSURE REQUIREMENT.  BUYER ACKNOWLEDGES THAT
THE PROPERTY MAY BE LOCATED IN A VERY HIGH FIRE HAZARD SEVERITY ZONE, WITHIN THE
MEANING OF CALIFORNIA GOVERNMENT CODE SECTIONS 51179 AND 51183.5; A WILDLAND
AREA THAT MAY CONTAIN SUBSTANTIAL FOREST FIRE RISKS, WITHIN THE MEANING OF
CALIFORNIA PUBLIC RESOURCES CODE SECTION 4136; AN EARTHQUAKE FAULT ZONE, WITHIN
THE MEANING OF CALIFORNIA PUBLIC RESOURCES CODE SECTION 2621.9; A SPECIAL FLOOD
HAZARD AREA, WITHIN THE MEANING OF CALIFORNIA GOVERNMENT CODE SECTION 8589.3; AN
AREA OF POTENTIAL FLOODING, WITHIN THE MEANING OF CALIFORNIA GOVERNMENT CODE
SECTION 8589.4; AND/OR A SEISMIC HAZARD ZONE, WITHIN THE MEANING OF CALIFORNIA
PUBLIC RESOURCES CODE SECTION 2694.  BUYER FURTHER ACKNOWLEDGES THAT: (I) IT IS
A SOPHISTICATED AND EXPERIENCED PURCHASER OF REAL PROPERTY; (II) BUYER AND
SELLER ARE PARTIES OF EQUAL BARGAINING STRENGTH; (III) THIS AGREEMENT IS NOT A
CONTRACT OF ADHESION BUT HAS BEEN EXPRESSLY NEGOTIATED BETWEEN THE PARTIES; AND
(IV) THIS AGREEMENT CONCERNS A TRANSACTION THAT IS PRIVATE IN NATURE.  IN VIEW
OF THE FOREGOING, BUYER HEREBY KNOWINGLY, VOLUNTARILY, INTENTIONALLY AND
IRREVOCABLY WAIVES ITS RIGHT TO DISCLOSURE OF NATURAL HAZARDS FOUND IN THE
NATURAL HAZARD DISCLOSURE ACT, CALIFORNIA GOVERNMENT CODE SECTIONS 8589.3,
8589.4, AND 51183.5, AND CALIFORNIA PUBLIC RESOURCES CODE SECTIONS 2621.9, 2694,
AND 4136, AND ANY SUCCESSOR STATUTES OR LAWS.

 

(H)  EFFECT OF DISCLAIMERS.  BUYER ACKNOWLEDGES AND AGREES THAT THE PURCHASE
PRICE HAS BEEN NEGOTIATED TO TAKE INTO ACCOUNT THAT THE PROPERTY IS BEING SOLD
SUBJECT TO THE PROVISIONS OF THIS PARAGRAPH 21 AND THAT SELLER WOULD HAVE
CHARGED A HIGHER PURCHASE PRICE IF THE PROVISIONS IN THIS PARAGRAPH 21 WERE NOT
AGREED UPON BY BUYER.

 

(I)  SURVIVAL.  THE PROVISIONS OF THIS PARAGRAPH 21 SHALL SURVIVE CLOSING AND
DELIVERY OF THE DEED.

 

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22.                                                         SURVIVAL OF
PROVISIONS.

 

(A)  ACCEPTANCE BY BUYER OF THE DEED AT CLOSING SHALL CONSTITUTE AN
ACKNOWLEDGMENT BY BUYER OF FULL PERFORMANCE BY SELLER OF ALL OF SELLER’S
OBLIGATIONS UNDER THIS AGREEMENT, EXCEPT FOR THE OBLIGATIONS OF SELLER WHICH ARE
EXPRESSLY PROVIDED IN THIS AGREEMENT TO SURVIVE CLOSING.

 

(B)  ANY OF BUYER’S OBLIGATIONS UNDER THIS AGREEMENT THAT ARE EXPRESSLY PROVIDED
IN THIS AGREEMENT TO SURVIVE CLOSING OR THAT SHALL POSSIBLY IMPLY PERFORMANCE OR
OBSERVANCE AFTER THE CLOSING DATE SHALL SURVIVE CLOSING AND DELIVERY OF THE
DEED, NOTWITHSTANDING ANY PRESUMPTION TO THE CONTRARY.

 

(C)  (I)  NOTWITHSTANDING ANY PROVISION TO THE CONTRARY SET FORTH IN THIS
AGREEMENT, THE REPRESENTATIONS OF SELLER EXPRESSLY SET FORTH IN PARAGRAPH 9 OF
THIS AGREEMENT SHALL SURVIVE CLOSING UNDER THIS AGREEMENT FOR A PERIOD OF FIVE
(5) MONTHS AFTER THE CLOSING (THE “SURVIVAL PERIOD”); PROVIDED, HOWEVER, THAT
SUCH REPRESENTATIONS ARE, AND ARE INTENDED TO BE, GIVEN AS OF THE DATE(S) SET
FORTH IN PARAGRAPH 9 HEREOF.

 

(II)                                  IF, ON ITS OWN (AND NOT AS A RESULT OF ANY
NOTICE FROM SELLER DELIVERED PURSUANT TO SECTION 9(B)), BUYER ACTUALLY
DETERMINES PRIOR TO THE CLOSING DATE THAT ANY OF THE REPRESENTATIONS OF SELLER
IN SUBPARAGRAPHS 9(A) WERE NOT TRUE WHEN GIVEN, BUYER’S SOLE RIGHT AND REMEDY
SHALL BE TO TERMINATE THIS AGREEMENT (AND RECEIVE A REFUND OF THE DEPOSIT) BY
GIVING TO SELLER WRITTEN NOTICE OF SUCH TERMINATION WITHIN TEN (10) DAYS AFTER
BUYER ACTUALLY LEARNS OF THE BREACH OF SUCH REPRESENTATION; PROVIDED, HOWEVER,
THAT IF BUYER FIRST ACQUIRED KNOWLEDGE OF SUCH BREACH BETWEEN THE EXPIRATION OF
THE INSPECTION PERIOD AND THE CLOSING DATE, AND IF THE BREACH WAS THE RESULT OF
A WILLFUL ACT BY SELLER, THEN BUYER SHALL, IN ADDITION AND CONTINGENT UPON
TERMINATION OF THE AGREEMENT, BE ENTITLED TO REIMBURSEMENT FOR OUT-OF-POCKET DUE
DILIGENCE COSTS AND ATTORNEYS’ FEES REASONABLY INCURRED BY BUYER IN CONNECTION
WITH THIS AGREEMENT, UP TO A MAXIMUM REIMBURSEMENT OF THIRTY FIVE THOUSAND AND
00/100 DOLLARS ($35,000.00).  IF BUYER FAILS TO GIVE SUCH WRITTEN TERMINATION
NOTICE TO SELLER WITHIN SUCH TIME PERIOD, BUYER SHALL BE DEEMED TO HAVE WAIVED
ANY RIGHT OR REMEDY (INCLUDING, WITHOUT LIMITATION, ANY RIGHT UNDER THIS
AGREEMENT TO TERMINATE THIS AGREEMENT) BY REASON OF SUCH BREACH.

 

(III)                               AFTER THE CLOSING, SELLER SHALL HAVE NO
LIABILITY TO BUYER BY REASON OF A BREACH OR DEFAULT OF ANY OF SELLER’S
REPRESENTATIONS, UNLESS BUYER SHALL HAVE GIVEN TO SELLER WRITTEN NOTICE
(“WARRANTY NOTICE”) OF SUCH BREACH OR DEFAULT WITHIN THE SURVIVAL PERIOD, AND
SHALL HAVE GIVEN TO SELLER AN OPPORTUNITY TO CURE ANY SUCH BREACH OR DEFAULT
WITHIN A REASONABLE PERIOD OF TIME AFTER SELLER RECEIVES BUYER’S WARRANTY
NOTICE.  NO CLAIM FOR ANY SUCH BREACH OF ANY REPRESENTATION OR WARRANTY OF
SELLER SHALL BE ACTIONABLE OR PAYABLE UNLESS THE VALID CLAIMS FOR ALL SUCH
BREACHES COLLECTIVELY AGGREGATE MORE THAN $35,000.00, IN WHICH EVENT THE FULL
AMOUNT OF SUCH CLAIMS SHALL BE ACTIONABLE.  IN NO EVENT, HOWEVER, SHALL THE
AGGREGATE LIABILITY OF SELLER TO BUYER BY REASON OF A BREACH OR DEFAULT
HEREUNDER EXCEED $250,000.00.  IN ANY EVENT, SELLER’S LIABILITY SHALL BE LIMITED
TO ACTUAL DAMAGES AND SHALL NOT INCLUDE CONSEQUENTIAL DAMAGES.  ANY LITIGATION
WITH RESPECT TO ANY REPRESENTATION MUST BE COMMENCED WITHIN THE SURVIVAL PERIOD,
AND IF NOT COMMENCED WITHIN SUCH TIME PERIOD, BUYER SHALL BE DEEMED TO HAVE
WAIVED ITS CLAIMS FOR SUCH BREACH OR DEFAULT.  IN ANY EVENT, ANY PROCEEDING OR
LITIGATION BASED UPON A CLAIM OF FRAUD, MISREPRESENTATION OR SIMILAR THEORY
SHALL BE COMMENCED BY BUYER WITHIN THE SURVIVAL PERIOD AND, IF APPROPRIATE
PROCEEDINGS ARE NOT COMMENCED WITHIN SUCH TIME PERIOD, BUYER SHALL BE DEEMED TO
HAVE WAIVED ANY SUCH CLAIM.

 

25

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(D)  SURVIVAL.  THE PROVISIONS OF THIS PARAGRAPH 22 SHALL SURVIVE CLOSING AND
DELIVERY OF THE DEED.

 

23.                                                         MISCELLANEOUS.

 

(a)  Captions or Headings; Interpretation.  The captions or headings of the
Paragraphs and subparagraphs of this Agreement are for convenience only, and
shall not control or affect the meaning or construction of any of the terms or
provisions of this Agreement.  Wherever in this Agreement the singular number is
used, the same shall include the plural and vice versa and the masculine gender
shall include the feminine gender and vice versa as the context shall require.

 

(B)  AMENDMENTS AND WAIVERS.  NO CHANGE, ALTERATION, AMENDMENT, MODIFICATION OR
WAIVER OF ANY OF THE TERMS OR PROVISIONS OF THIS AGREEMENT SHALL BE VALID,
UNLESS THE SAME SHALL BE IN WRITING AND SIGNED BY BUYER AND SELLER.

 

(C)  COUNTERPARTS.  THIS AGREEMENT MAY BE EXECUTED BY FACSIMILE SIGNATURE AND IN
MULTIPLE COUNTERPARTS EACH OF WHICH SHALL BE DEEMED AN ORIGINAL BUT TOGETHER
SHALL CONSTITUTE ONE AGREEMENT.

 

(D)  APPLICABLE LAW.  THIS AGREEMENT SHALL BE GOVERNED AND CONSTRUED ACCORDING
TO THE LAWS OF THE STATE OF CALIFORNIA.

 

(E)  RIGHT TO WAIVE CONDITIONS OR CONTINGENCY.  EITHER PARTY MAY WAIVE ANY OF
THE TERMS AND CONDITIONS OF THIS AGREEMENT MADE FOR ITS BENEFIT PROVIDED SUCH
WAIVER IS IN WRITING AND SIGNED BY THE PARTY WAIVING SUCH TERM OR CONDITION.

 

(F)  PARTIAL INVALIDITY.  IF ANY TERM, COVENANT, CONDITION OR PROVISION OF THIS
AGREEMENT OR THE APPLICATION THEREOF TO ANY PERSON OR CIRCUMSTANCE SHALL BE
INVALID OR UNENFORCEABLE, AT ANY TIME OR TO ANY EXTENT, THE REMAINDER OF THIS
AGREEMENT, OR THE APPLICATION OF SUCH TERM OR PROVISION TO PERSONS OR
CIRCUMSTANCES OTHER THAN THOSE AS TO WHICH IT IS HELD INVALID OR UNENFORCEABLE,
SHALL NOT BE AFFECTED THEREBY, UNLESS SUCH INVALIDITY OR UNENFORCEABILITY
MATERIALLY FRUSTRATES THE INTENT OF THE PARTIES AS SET FORTH HEREIN.  EACH TERM,
COVENANT, CONDITION AND PROVISION OF THIS AGREEMENT SHALL BE VALID AND ENFORCED
TO THE FULLEST EXTENT PERMITTED BY LAW.

 

(G)  CONFIDENTIALITY.  BUYER AGREES TO TREAT ALL INFORMATION RECEIVED WITH
RESPECT TO THE PROPERTY, WHETHER SUCH INFORMATION IS OBTAINED FROM SELLER OR
FROM BUYER’S OWN DUE DILIGENCE INVESTIGATIONS, IN A CONFIDENTIAL MANNER.  BUYER
SHALL NOT DISCLOSE ANY SUCH INFORMATION TO ANY THIRD PARTIES, OTHER THAN SUCH
DISCLOSURE TO BUYER’S COUNSEL, PROSPECTIVE LENDERS, CONSULTANTS, ACCOUNTANTS AND
ADVISERS AS MAY BE REQUIRED IN CONNECTION WITH THE TRANSACTIONS CONTEMPLATED
HEREBY (SUCH DISCLOSURE TO BE MADE EXPRESSLY SUBJECT TO THIS CONFIDENTIALITY
REQUIREMENT).  SELLER AND BUYER AGREE TO KEEP THIS AGREEMENT CONFIDENTIAL AND
NOT MAKE ANY PUBLIC ANNOUNCEMENTS OR DISCLOSURES WITH RESPECT TO THE SUBJECT
MATTER OF THIS AGREEMENT PRIOR TO CLOSING WITHOUT THE WRITTEN CONSENT OF THE
OTHER PARTY; PROVIDED, HOWEVER, THAT THE FOREGOING PROVISIONS OF THIS PARAGRAPH
SHALL NOT OPERATE TO LIMIT THE ABILITY OF SELLER OR BUYER, AS THE CASE MAY BE,
TO COMPLY WITH THE PROVISIONS OF APPLICABLE LAW, OR ANY RULES AND REGULATIONS OF
THE UNITED STATES SECURITIES AND EXCHANGE COMMISSION, THAT REQUIRE DISCLOSURE.

 

26

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(H)  AGREEMENT NOT TO BE RECORDED.  THIS AGREEMENT SHALL NOT BE FILED OF RECORD
BY OR ON BEHALF OF BUYER IN ANY OFFICE OR PLACE OF PUBLIC RECORD.  IF BUYER
FAILS TO COMPLY WITH THE TERMS HEREOF BY RECORDING OR ATTEMPTING TO RECORD THIS
AGREEMENT OR A NOTICE THEREOF, SUCH ACT SHALL NOT OPERATE TO BIND OR CLOUD THE
TITLE TO THE PREMISES.  SELLER SHALL, NEVERTHELESS, HAVE THE RIGHT FORTHWITH TO
INSTITUTE APPROPRIATE LEGAL PROCEEDINGS TO HAVE THE SAME REMOVED FROM RECORD. 
IF BUYER OR ANY AGENT, BROKER OR COUNSEL ACTING FOR BUYER SHALL CAUSE OR PERMIT
THIS AGREEMENT OR A COPY THEREOF TO BE FILED IN AN OFFICE OR PLACE OF PUBLIC
RECORD, SELLER, AT ITS OPTION, AND IN ADDITION TO SELLER’S OTHER RIGHTS AND
REMEDIES, MAY TREAT SUCH ACT AS A MATERIAL DEFAULT OF THIS AGREEMENT ON THE PART
OF BUYER.  HOWEVER, THE FILING OF THIS AGREEMENT IN ANY LAWSUIT OR OTHER
PROCEEDINGS IN WHICH SUCH DOCUMENT IS RELEVANT OR MATERIAL SHALL NOT BE DEEMED
TO BE A VIOLATION OF THIS PARAGRAPH, NOR SHALL ANY OTHER FILING OF THIS
AGREEMENT, IF REQUIRED UNDER LAWS RELATING TO CORPORATE GOVERNANCE, OR UNDER ANY
RULES AND REGULATIONS OF THE UNITED STATES SECURITIES AND EXCHANGE COMMISSION,
BE DEEMED A VIOLATION OF THIS PARAGRAPH.

 

24.                                                         INTENTIONALLY
OMITTED.

 

25.                                                         SOPHISTICATION OF
THE PARTIES.  EACH PARTY HERETO HEREBY ACKNOWLEDGES AND AGREES THAT IT HAS
CONSULTED LEGAL COUNSEL IN CONNECTION WITH THE NEGOTIATION OF THIS AGREEMENT AND
THAT IT HAS BARGAINING POWER EQUAL TO THAT OF THE OTHER PARTIES HERETO IN
CONNECTION WITH THE NEGOTIATION AND EXECUTION OF THIS AGREEMENT.  ACCORDINGLY,
THE PARTIES HERETO AGREE THE RULE OF CONTRACT CONSTRUCTION TO THE EFFECT THAT AN
AGREEMENT SHALL BE CONSTRUED AGAINST THE DRAFTSMAN SHALL HAVE NO APPLICATION IN
THE CONSTRUCTION OR INTERPRETATION OF THIS AGREEMENT.

 

26.                                                         LIMITED LIABILITY. 
THE OBLIGATIONS OF SELLER UNDER THIS AGREEMENT OR DIRECTLY OR INDIRECTLY ARISING
OUT OF THIS AGREEMENT SHALL BE LIMITED SOLELY TO SELLER’S INTEREST IN THE
PREMISES AND PERSONAL PROPERTY (AND THE SALE PROCEEDS THEREOF) AND ANY OTHER
ASSETS OF SELLER, AND NEITHER BUYER NOR ANY ONE ELSE CLAIMING BY OR THROUGH
BUYER SHALL HAVE ANY CLAIM AGAINST ANY DIRECT OR INDIRECT PARTNER, MEMBER OR
EQUITY OWNER OF SELLER.

 

27.                                                         MARKETING.  SELLER
SHALL HAVE THE RIGHT TO MARKET THE PREMISES TO ANY OTHER PROSPECTIVE PURCHASERS
DURING THE PERIOD BETWEEN THE DATE OF THIS AGREEMENT AND THE EXPIRATION OF THE
INSPECTION PERIOD; PROVIDED, HOWEVER, THAT SELLER SHALL NOT ENTER INTO ANY
AGREEMENT WITH ANY SUCH PROSPECTIVE PURCHASER UNLESS THE TRANSACTIONS
CONTEMPLATED THEREBY ARE CONTINGENT UPON THE TERMINATION OF THIS AGREEMENT.

 

28.                                                         ENFORCEMENT.  IF
EITHER PARTY HERETO FAILS TO PERFORM ANY OF ITS OBLIGATIONS UNDER THIS AGREEMENT
OR IF A DISPUTE ARISES BETWEEN THE PARTIES HERETO CONCERNING THE MEANING OR
INTERPRETATION OF ANY PROVISION OF THIS AGREEMENT, THEN THE DEFAULTING PARTY OR
THE PARTY NOT PREVAILING IN SUCH DISPUTE SHALL PAY ANY AND ALL COSTS AND
EXPENSES INCURRED BY THE OTHER PARTY ON ACCOUNT OF SUCH DEFAULT AND/OR IN
ENFORCING OR ESTABLISHING ITS RIGHTS HEREUNDER, INCLUDING, WITHOUT LIMITATION,
COURT COSTS AND REASONABLE ATTORNEYS’ FEES AND DISBURSEMENTS.  ANY SUCH
ATTORNEYS’ FEES AND OTHER EXPENSES INCURRED BY EITHER PARTY IN ENFORCING A
JUDGMENT IN ITS FAVOR UNDER THIS AGREEMENT SHALL BE RECOVERABLE SEPARATELY FROM
AND IN ADDITION TO ANY OTHER AMOUNT INCLUDED IN SUCH JUDGMENT, AND SUCH
ATTORNEYS’ FEES OBLIGATION IS INTENDED TO BE SEVERABLE FROM THE OTHER PROVISIONS
OF THIS AGREEMENT AND TO SURVIVE AND NOT BE MERGED INTO ANY SUCH JUDGMENT.

 

[Signatures on next page]

 

27

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IN WITNESS WHEREOF, the parties hereto, intending legally to be bound hereby,
have executed this Agreement as of the date first above written.

 

SELLER:

 

 

 

2975 STENDER ASSOCIATES LLC,

 

a Delaware limited liability company

 

 

 

By:

P VI 2975 Stender LLC,

 

 

a Delaware limited liability company,

 

 

its managing member

 

 

 

 

 

 

By:

/s/ Christopher Hughes

 

 

 

Name:

Christopher Hughes

 

 

 

Title:

Vice President

 

 

 

 

 

 

BUYER:

 

 

 

CATALYST SEMICONDUCTOR, INC.,

 

a Delaware corporation

 

 

 

 

 

By:

 

/s/ Thomas E. Gay III

 

 

Name:

 

Thomas E. Gay III

 

 

Title:

 

CFO & Secretary

 

 

 

 

ESCROWEE IS EXECUTING THIS AGREEMENT SOLELY TO EVIDENCE ITS AGREEMENT TO BE
BOUND BY THE ESCROW INSTRUCTIONS AND OTHER DUTIES OF ESCROWEE SET FORTH IN THIS
AGREEMENT.

 

Escrowee:

 

FIRST AMERICAN TITLE COMPANY

 

By:

 

 

Name:

 

 

Title:

 

 

 

28

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

 

EXHIBIT ”A”

 

LEGAL DESCRIPTION

 

PARCEL 2, AS SHOWN UPON THAT CERTAIN MAP ENTITLED, “PARCEL MAP BEING A
RESUBDIVISION OF PARCEL “D” AS SHOWN ON THAT PARCEL MAP RECORDED IN BOOK 338 OF
MAPS AT PAGE 40”, WHICH MAP WAS FILED FOR RECORD IN THE OFFICE OF THE RECORDER
OF THE COUNTY OF SANTA CLARA, STATE OF CALIFORNIA, ON AUGUST 10, 1977 IN BOOK
401 OF MAPS AT PAGE 38.

 

APN:                   216-29-106

 

A-1

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

 

EXHIBIT ”B”

 

PERSONAL PROPERTY

 

None

 

B-1

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

 

EXHIBIT ”C”

 

INTENTIONALLY OMITTED

 

C-1

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

 

EXHIBIT ”D”

 

INTENTIONALLY OMITTED

 

D-1

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

 

EXHIBIT ”E”

 

SCHEDULE OF EXISTING AGREEMENTS

 

1.                                       Fire and Sprinkler – Pacific Auxiliary
Fire Alarm Company, dated November 21, 2005.

 

2.                                       Parking Lot Sweeping – Prosweep, dated
November 14, 2005.

 

3.                                       Security Patrols – Golden State
Security and Patrol, dated November 1, 2005.

 

4.                                       Landscaping – Maniglia Landscaping,
dated October 12, 2005.

 

5.                                       City of Santa Clara electric account
number 00062282-03.

 

6.                                       City of Santa Clara water account
numbers 00062282-03, 00062283-03, 00062281-03.

 

7.                                       Pacific Bell elevator phone accounts
408-844-8369 and 408-844-8503.

 

E-1

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EXHIBIT ”F”

 

GENERAL ASSIGNMENT AND ASSUMPTION AGREEMENT

 

THIS GENERAL ASSIGNMENT AND ASSUMPTION AGREEMENT, made and entered into as of
this         day of                ,          , [PRAEDIUM ENTITY], a Delaware
limited liability company, having an office c/o The Praedium Group, LLC, 825
Third Avenue, 36th Floor, New York, New York 10022 (“Assignor”) and
                              , a                                having an
office at                                              (“Assignee”).

 

W I T N E S S E T H:

 

That Assignor for Ten and 00/100 Dollars ($10.00) and other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged,
hereby conveys, grants, bargains, sells, transfers, sets over, assigns,
releases, delivers and confirms to Assignee, without representation, warranty or
covenant, all of Assignor’s right, title and interest in and to (x) the
agreements, documents and instruments identified on Exhibit ”A” hereto (the
“Existing Agreements”) and (y) to the extent transferable, all other documents,
instruments, licenses, permits and guaranties, if any, which relate to the
Premises being conveyed to Assignee by Assignor on the date hereof.

 

Assignee hereby expressly assumes the obligation for the performance of any and
all of the obligations of Assignor under the Existing Agreements.

 

Terms not defined herein shall have the meanings ascribed thereto in the
Agreement of Sale dated as of                     , 2005 between Assignor and
Assignee (“Agreement of Sale”).

 

This Assignment and Assumption shall inure to the benefit of all parties hereto
and their respective heirs, successors and assigns.

 

THIS ASSIGNMENT IS MADE ON AN “AS-IS, WHERE-IS, WITH ALL FAULTS” BASIS, WITHOUT
RECOURSE AND WITHOUT ANY REPRESENTATION OR WARRANTY (EXPRESS OR IMPLIED)
WHATSOEVER EXCEPT AS MAY EXPRESSLY BE SET FORTH IN THE AGREEMENT OF SALE.

 

F-1

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

 

IN WITNESS WHEREOF, the parties have executed this Assignment and Assumption as
of the day and year first above written.

 

ASSIGNOR:

[Praedium Entity]

 

 

 

 

 

By:

 

 

 

Name:

 

 

 

Title:

 

 

 

 

 

 

ASSIGNEE:

 

,

 

 

a

 

 

 

 

 

 

 

By:

 

 

 

Name:

 

 

 

Title:

 

 

 

Exhibit ”A”                                  
-                                            Existing Agreements

 

F-2

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

 

EXHIBIT ”G”

 

INFORMATION MATERIALS

 

A copy of each of the following (to the extent in Seller’s possession):

 

1.               Phase I Environmental Report, Clayton Group, August 2005

 

2.               Seismic Assessment Report, Biggs Cardosa, dated August 2005

 

3.               Mechanical Inspection Report, AirCom Mechanical, dated
August 2005

 

4.               Roofing Report, Weathershield, dated August 2005

 

5.               Preliminary Title Report, First American Title, dated July 2005

 

6.               Asbestos Removal, Asbestos Removal Services, August 2005

 

7.               ALTA Survey, Kier & Wright Civil Engineers, dated August 2005

 

G-1

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

 

EXHIBIT ”H”

 

INTENTIONALLY OMITTED

 

H-3

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

 

EXHIBIT ”I”

 

INTENTIONALLY OMITTED

 

I-1

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

 

EXHIBIT ”J”

 

DEED

 

 

RECORDING REQUESTED BY:

 

 

 

 

 

WHEN RECORDED, RETURN TO:

 

 

 

 

 

[Grantee]

 

 

 

 

 

 

 

 

 

 

 

Attn:

 

 

 

 

 

THIS SPACE FOR RECORDER’S USE ONLY

 

 

GRANT DEED

 

In accordance with Section 11932 of the California Revenue and Taxation Code, as
amended, Grantor has declared the amount of transfer tax which is due by a
separate statement that is not being recorded with this Grant Deed.

 

FOR VALUABLE CONSIDERATION, receipt of which is hereby acknowledged, [PRAEDIUM
ENTITY, a                                      ] (“Grantor”), hereby GRANTS to: 
[                                                                      ]
(collectively, “Grantee”), all of Grantor’s right, title and interest in and to
the real property located in the City of Manhattan Beach, County of Los Angeles,
State of California, and more particularly described on Exhibit A attached
hereto and incorporated herein by reference (the “Property”).

 

SUBJECT TO:

 

1.                                       Taxes and assessments which are a lien,
but which are not yet billed, or are billed but are not yet due and payable and
any assessments not shown on the public record; and subsequent assessments for
prior years due to change in the land usage or ownership;

 

2.                                       All matters that would be disclosed by
an accurate physical inspection or an accurate survey of the Property;

 

3.                                       All covenants, conditions, easements,
restrictions, liens, encumbrances and other exceptions of record; and

 

4.                                       All laws, regulations or ordinances
(including, but not limited to, zoning, building and environmental laws,
regulations and ordinances) applicable to the Property.

 

[signatures on next page]

 

1

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

 

Signature Page of Grant Deed

 

IN WITNESS WHEREOF, Grantor has caused this Grant Deed to be executed as of the
           day of                            , 2005.

 

“GRANTOR”:

 

2975 STENDER ASSOCIATES LLC,
a Delaware limited liability company

 

By:

P VI 2975 Stender LLC,

 

 

a Delaware limited liability company,

 

 

its managing member

 

 

 

 

 

 

By:

 

 

 

Name:

 

 

 

Title:

 

 

 

 

 

 

STATE OF

 

)

 

 

)

COUNTY OF

 

)

 

 

On                        , 2005, before me,                                  ,
a Notary Public in and for said County and State, personally appeared
                                                         , personally known to
me (or proved to me on the basis of satisfactory evidence) to be the persons
whose names are subscribed to the within instrument and acknowledged to me that
they executed the same in their authorized capacities, and that by their
signatures on the instrument the persons, or the entity upon behalf of which the
persons acted, executed the instrument.

 

WITNESS my hand and official seal.

 

 

 

 

SIGNATURE OF NOTARY

(Notary Seal)

 

2

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

 

EXHIBIT A TO GRANT DEED

 

Description of Property

 

3

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

 

STATEMENT OF TAX DUE AND REQUEST
THAT TAX DECLARATION NOT BE MADE A PART OF THE PERMANENT
RECORD IN THE OFFICE OF THE COUNTY RECORDER

 

(Pursuant to Cal. Rev. and Tax Code Section 11932)

 

To:                              Registrar - Recorder
County of Santa Clara

 

Request is hereby made in accordance with the provisions of the Documentary
Transfer Tax Act that the amount of tax due not be shown on the original
document which names:

 

2975 STENDER ASSOCIATES LLC,

a Delaware limited liability company, as Grantor

 

and

 

[                                              ]

as Grantee.

 

The property described in the accompanying document is located in the City of
Santa Clara, County of Santa Clara, State of California.  The amount of tax due
on the accompanying document is
                                                                                   
($                         ), computed on the full value of the property
conveyed, less any liens remaining on the property.

 

2975 STENDER ASSOCIATES LLC,
a Delaware limited liability company

 

By:

P VI 2975 Stender LLC,

 

 

a Delaware limited liability company,

 

 

its managing member

 

 

 

 

 

 

By:

 

 

 

Name:

 

 

 

Title:

 

 

 

J-1

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

 

EXHIBIT ”K”

 

BILL OF SALE

 

THIS BILL OF SALE is made as of the          day of                , 2005, from
[PRAEDIUM ENTITY], a Delaware limited liability company (“Seller”), to
                                                ,  a
                                              (“Buyer”).

 

RECITALS:

 

WHEREAS, contemporaneously with the execution and delivery of this Bill of Sale,
Seller has sold and conveyed to Buyer all of Seller’s right, title and interest
and estate in and to the real property described in Exhibit ”A” attached hereto
and made a part hereof and all buildings, structures and improvements located
thereon by Deed of even date herewith (all of such buildings, structures,
improvements and real property collectively hereinafter referred to as the “Real
Property”); and

 

WHEREAS, as a part of the consideration for the conveyance of the Real Property,
Seller has agreed to convey to Buyer Seller’s interest in the items of personal
property, if any, that are owned by Seller and located in and on and used in
connection with, the Real Property;

 

NOW, THEREFORE, in consideration of the sum of $10.00 and other good and
valuable consideration, the receipt and adequacy of which are hereby
acknowledged, Seller does hereby (a) sell, assign, and convey to Buyer (without
any representation or warranty whatsoever) Seller’s right, title and interest,
if any, in and to the personal property, if any, that is owned by Seller,
located at the Real Property and used in connection with the management or
operation of the Real Property (whether or not any such items constitute
“personal property” or “fixtures” as a matter of state law) including, without
limitation, the items listed on Exhibit ”B” attached hereto and (b) quit claim
and release to Buyer, to the extent existing and assignable, Seller’s right,
title and interest (if any) in the trade names, plans and specifications,
construction warranties and guaranties, tenant records, and like personal
property, in the possession of Seller which directly relate to the Real
Property, subject in both cases to matters of public record and to rights of
tenants under written leases in effect on the date hereof.

 

TO HAVE AND TO HOLD the same unto Buyer, its successors and assigns, forever.

 

This Bill of Sale shall be binding upon and shall inure to the benefit of
Seller, Buyer and their respective successors and assigns.

 

This Bill of Sale shall be governed by and construed in accordance with the laws
of the State of California.

 

K-1

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

 

NOTWITHSTANDING ANYTHING CONTAINED IN THIS BILL OF SALE TO THE CONTRARY, THIS
BILL OF SALE IS MADE (I) WITHOUT ANY WARRANTY OR REPRESENTATION OF ANY KIND
WHATSOEVER, EXPRESS OR IMPLIED, EXCEPT AS EXPRESSLY SET FORTH IN THE AGREEMENT
OF SALE DATED AS OF                       , 2005, WHICH REPRESENTATIONS, IF ANY,
ARE THEREIN QUALIFIED, AND (II) SUBJECT TO THE DISCLAIMERS, QUALIFICATIONS AND
ENCUMBRANCES SET FORTH THEREIN, AND SUCH DISCLAIMERS, QUALIFICATIONS AND
ENCUMBRANCES ARE HEREBY INCORPORATED HEREIN BY REFERENCE AND MADE A PART HEREOF.

 

IN WITNESS WHEREOF, Seller has caused this Bill of Sale to be duly signed as of
the day and year first written above.

 

 

SELLER:

 

[Praedium Entity]

 

 

By:

 

 

Name:

 

 

Title:

 

 

 

 

BUYER:

 

[Buyer Entity]

 

 

By:

 

 

Name:

 

 

Title:

 

 

 

 

Exhibit ”A”                                  
-                                            Real Property Description

 

Exhibit ”B”                                    
-                                            Personal Property

 

K-2

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

 

EXHIBIT ”L”

 

FIRPTA CERTIFICATION

 

A.                                   Federal FIRPTA Certificate

 

To inform
                                                                         
(“Transferee”), that withholding of tax under Section 1445 of the Internal
Revenue Code of 1986, as amended (the “Code”), will not be required upon the
transfer to Transferee by 2975 STENDER ASSOCIATES LLC, a Delaware limited
liability company (“Transferor”), of certain real property, located at 2975
Stender Way, Santa Clara, California, Transferor hereby certifies to Transferee:

 

1.  Transferor is not a foreign corporation, foreign partnership, foreign trust,
or foreign estate (as those terms are defined in the Code and the regulations
promulgated thereunder);

 

2.  Transferor is not a disregarded entity as defined in §1.1445-2(b)(2)(iii) of
the income tax regulations promulgated under the Code.

 

3.  Transferor’s U.S. tax identification number is
                                 ; and

 

4.  Transferor’s office address is 825 Third Avenue, 36th Floor, New York, New
York 10022.

 

Transferor understands that this Certification may be disclosed to the Internal
Revenue Service by Transferee and that any false statement contained herein
could be punished by fine, imprisonment, or both.

 

B.                                     STATE OF CALIFORNIA RESIDENT/NONRESIDENT
AFFIDAVIT

 

In accordance with Section 18662 of the Revenue and Taxation Code, a buyer may
be required to withhold an amount equal to 3-1/3 percent of the sales price in
the case of a disposition of California real property by either:

 

1.                                       A seller who is an individual with a
last known street address outside of California or when the disbursement
instructions authorize the proceeds to be sent to a financial intermediary of
seller, OR

 

2.                                       A corporate seller which has no
permanent place of business in California.

 

The buyer may become subject to penalty for failure to withhold an amount equal
to the greater of 10 percent of the amount required to be withheld or five
hundred dollars ($500).  However, notwithstanding any other provision included
in the California statutes referenced above, no buyer will be required to
withhold any amount

 

N-1

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

 

or be subject to penalty for failure to withhold if:

 

(a)                                  The sales price of the California real
property conveyed does not exceed one hundred thousand dollars ($100,000), OR

 

(b)                                 The seller executes a written certificate,
under the penalty of perjury, certifying that the seller is a resident of
California, or if a corporation, has a permanent place of business in
California, or if a limited liability company, is classified as a partnership
and is not a disregarded single-member limited liability company for federal and
California income tax purposes, OR

 

(c)                                  The seller, who is an individual, executes
a written certificate, under penalty of perjury, that the California real
property being conveyed is the seller’s principal residence (as defined in
Section 1034 of the Internal Revenue Code).

 

Transferor hereby certifies that it is not subject to the above-mentioned
withholding because it is classified as a partnership and is not a disregarded
single-member limited liability company for federal and California income tax
purposes.

 

Transferor understands that Transferee is relying on this Certification in
determining whether withholding is required upon said transfer.  Under penalties
of perjury, I declare that I have examined this certification and to the best of
my knowledge and belief it is true, correct, and complete, and I further declare
that I have authority to sign this document on behalf of Transferor.

 

Executed as of                                 , 2005.

 

TRANSFEROR:

 

2975 STENDER ASSOCIATES LLC,
a Delaware limited liability company

 

By:

P VI 2975 Stender LLC,

 

a Delaware limited liability company,

 

its managing member

 

 

 

 

 

By:

 

 

 

Name:

 

 

 

Title:

 

 

 

N-2

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