Document:

Exhibit 10.19

 

AGREEMENT
FOR PURCHASE AND SALE OF REAL PROPERTY

 

Between

 

BACCARAT
SILICON INC.

a
California corporation

 

(“Seller)

 

and

 

DAN
CAPUTO CO.,

a
California corporation

 

(“Buyer”)

 

 

 

AGREEMENT FOR PURCHASE AND SALE OF REAL PROPERTY

 

This Agreement for Purchase
and Sale of Real Property (“Agreement”) is made as of this Fifth (5th) day of
August, 2003 (“Effective Date”) by and between BACCARAT SILICON INC., a
California corporation (“Seller”), and DAN CAPUTO CO., a California corporation
(“Buyer”).

 

To provide for the purchase
and sale of the real property herein described, for good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged,
Buyer and Seller agree as follows:

 

1.             Purchase and Sale of Property.  Seller shall sell to Buyer, and Buyer shall
purchase from Seller, upon the terms and conditions hereinafter set forth, that
certain real property (APN 003-863-007) located at 1566 Moffett Street in the
City of Salinas, County of Monterey, State of California, and more particularly
described on Exhibit ”A” attached hereto (“Property”).  The Property is improved with a
free-standing industrial/office building (“Building”) and ancillary buildings.  The Property shall include (i) said real
property, (ii) the Building, all other structures located on the Property, and
all equipment owned by Seller and used in connection with the operation of the
Building, such as heating and air conditioning systems (collectively, “Building
Improvements”), (iii) all personal property owned by Seller located on and used
exclusively in the use or operation of the Building, if any (“Personal
Property”) and (iv) all rights, privileges, and easements appurtenant to the
Property, including, without limitation, all development rights, air rights,
water, water rights, riparian rights and water stock relating to the Property,
any rights of way or other appurtenances reflected in the public record and
used in connection with the beneficial use and enjoyment of the Property, and
all of Seller’s right, title, and interest in and to all public roads and
alleys adjoining or servicing the Property.

 

2.             Purchase Price. 
Buyer shall pay Six Million One Hundred Thousand Dollars ($6,100,000)
for the Property (“Purchase Price”).

 

3.             Payment of Purchase Price.  The Purchase Price for the Property shall be
evidenced by and paid to Seller as follows:

 

(a)           Deposit. 
Concurrently with Buyer’s execution of this Agreement, Buyer shall
deposit with Escrow Holder (as defined in Section 4(a) below), by wire transfer
or a bank cashier’s check, the amount of One Hundred Thousand Dollars
($100,000.00) (“Initial Deposit”). 
Escrow Holder shall place the Initial Deposit in an interest-bearing
account with all interest accruing to Buyer. 
If Buyer terminates this Agreement prior to the expiration of the
Feasibility Period (as defined in Section 6 below), Escrow Holder shall return
the Initial Deposit and all interest accrued to Buyer. If Buyer does not
terminate this Agreement prior to the expiration of the Feasibility Period in
accordance with Section 6(b), the Initial Deposit shall become nonrefundable to
Buyer, except as provided in Sections 8 and 15(b) below.  The Initial Deposit shall be credited
against the Purchase Price at the Close of Escrow (as defined in Section 4(b) below).

 

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(b)           Additional Deposit.  Unless Buyer terminates this Agreement in accordance with Section
6(b), Buyer shall, on or before the last day of the Feasibility Period, deposit
with Escrow Holder cash in the amount of Two Hundred Thousand Dollars
($200,000) (“Additional Deposit”). 
Escrow Holder shall deposit the Additional Deposit into an
interest-bearing account together with the Initial Deposit.  The Additional Deposit shall be
non-refundable, except as provided in Sections 8 and 15(b) below. The
Additional Deposit shall be credited against the Purchase Price at the Close of
Escrow.  If Buyer fails to complete the
purchase of the Property in accordance with this Agreement, then Seller shall
be entitled to retain the Initial Deposit and the Additional Deposit as
liquidated damages pursuant to Section 15 hereof.

 

(c)           Purchase Price Balance.  On or before the Closing Date (as defined in Section 4(b) below),
Buyer shall deposit with Escrow Holder cash in the amount of the Purchase
Price, less the sum of the Initial Deposit and the Additional Deposit and all
interest accrued thereon.

 

4.             Escrow.

 

(a)           Escrow Holder. 
Concurrently with the execution of this Agreement, the parties shall
open an escrow (“Escrow”) with First American Title Company, whose address is
1727 North First Street, Suite 100, San Jose, California 95112, Attention:  Ms.
Dian Blair,  (408)  451-7800 (“Escrow Holder” or “Title
Company”, as applicable) for purposes of consummating the transaction
contemplated by this Agreement. 
Concurrently with the opening of Escrow, the parties shall deliver to
Escrow Holder a copy of this Agreement and instructions for the disposition of
the Initial Deposit and Additional Deposit in accordance with the terms of this
Agreement.  At least twenty-four (24)
hours prior to the Close of Escrow, Buyer and Seller shall each deliver to
Escrow Holder written closing instructions and all executed documents, payments
and funds necessary to complete the same in accordance with the terms hereof.

 

(b)           Close of Escrow. 
The Close of Escrow for the purchase and sale of the Property shall
occur on the first business day that is fifteen (15) calendar days after the
expiration of the Feasibility Period. 
For purposes of this Agreement, the “Close of Escrow” or the “Closing
Date” shall mean the date that the Grant Deed (as defined in Section 11(a)(i))
is recorded by Escrow Holder in the Official Records of Monterey County,
California.

 

5.             Title.

 

(a)           Title Approval. 
Within seven (7) business days after the Effective Date, Seller shall
cause Escrow Holder to provide Buyer with a current preliminary title report
for the Property (the “Title Report”) issued by Escrow Holder, together with
copies of all related underlying documents. 
Buyer shall have thirty (30) days after receipt of the Title Report and
underlying documents within which to notify Seller in writing of any objections
Buyer may have to any exceptions to title as reflected in the Title Report
(“Disapproved Exceptions”).  Failure of
Buyer to give Seller written notice of any Disapproved Exceptions within said
thirty (30) day period shall be deemed Buyer’s approval of all exceptions to
title shown on the Title Report.  Within
ten (10) days after receipt of Buyer’s notice of any Disapproved Exceptions,
Seller may

 

 

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elect to (i) commit to cause such Disapproved
Exceptions to be released of record or to cause the Title Company to endorse
over such Disapproved Exceptions, prior to the Close of Escrow, or (ii) elect
not to commit to remove any Disapproved Exceptions.  If Seller fails to give notice of its election within said ten
(10) day period, Seller shall be deemed to have elected not to remove any
Disapproved Exceptions.  Notwithstanding
the foregoing, Seller shall be obligated to remove any delinquent taxes or
assessments, mechanic’s liens or monetary encumbrances placed by Seller on the
Property prior to the Close of Escrow. 
If Seller elects or is deemed to have elected not to remove any
Disapproved Exceptions, Buyer shall have the right, within ten (10) days of
receipt of notice of Seller’s election or deemed election, to (i) elect to
terminate this Agreement, or (ii) waive its objection to the Disapproved
Exceptions and proceed to the Close of Escrow. 
Buyer’s failure to make such election within said ten (10) day period
shall be deemed Buyer’s waiver of the Disapproved Exceptions and election to
proceed to the Close of Escrow.  In the
event this Agreement is terminated pursuant to this Section 5(a), Escrow Holder
shall return the Initial Deposit and all interest accrued thereon to Buyer, and
thereafter neither party shall have any further obligation hereunder except
with respect to the indemnity obligations pursuant to Sections 7(e) and 14 of
this Agreement.

 

(b)           Permitted Exceptions.  As used herein, “Permitted Exceptions” shall mean all exceptions
to title shown on the Title Report (including all preprinted exceptions)
approved by Buyer, any Disapproved Exceptions waived or deemed waived by Buyer,
the lien of real property taxes and assessments not yet due and payable and
supplemental taxes, if any, resulting from Buyer’s acquisition of the Property,
the Lease (as defined in Section 5(e), any title exceptions resulting from or
caused by Buyer in connection with its inspection of or activities on the
Property, any matters that would be disclosed by a survey of the Property.

 

(c)           Intentionally Omitted.

 

(d)           Title Insurance. 
Seller shall pay the premium for a standard coverage CLTA owner’s policy
of title insurance to be issued by Escrow Holder to Buyer with a liability
limit equal to the Purchase Price, showing title to the Property vested in
Buyer subject to the Permitted Exceptions (the “Owner’s Title Policy”).  In the event Buyer desires to obtain a
standard coverage ALTA owner’s policy of title insurance, Buyer shall be
responsible, at Buyer’s sole cost and expense, for obtaining an ALTA Survey of
the Property, and the payment of the ALTA portion of the title policy premium.  Buyer shall pay, at Buyer’s sole cost and
expense, the cost of any endorsements required by Buyer.  In no event shall the Close of Escrow be
extended in order to permit Buyer to obtain a survey of the Property.

 

(e)           IDT Lease. 
The Property is currently occupied by Integrated Device Technology, Inc.
(“IDT”), an affiliate of Seller.  At the
Close of Escrow, Seller’s affiliate, 1566 Moffett LLC, a California limited
liability company, and IDT shall enter into a lease of the Property in the form
attached hereto as Exhibit “B” (“Lease”). 
Under the Lease, IDT shall remain in occupancy of the Property after the
Close of Escrow for the term specified in the Lease.

 

(f)            Further Encumbrance.  Prior to the Close of Escrow, Seller shall not voluntarily create
any additional title exceptions, execute any leases of the Property or further

 

 

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encumber the Property for a period beyond the
Close of Escrow, except with Buyer’s prior written consent, which may be given
or withheld in Buyer’s sole and absolute discretion.  If between the date of Buyer’s approval of title and the Close of
Escrow, any additional exception to title appears as shown in a supplemental
title report issued by the Title Company that is not approved by Buyer or
caused by Buyer or Buyer’s activities on the Property (in which case the
additional title exception shall be deemed a Permitted Exception), Buyer shall
give prompt written notice of such new title exception to Seller.  Seller shall be obligated to remove from
title (or to cause to be insured over to Buyer’s reasonable satisfaction) any
such additional title exceptions that are voluntarily created by Seller between
the expiration of the Feasibility Period and the Close of Escrow.  With respect to any such additional title
exceptions that were not voluntarily created by Seller, Buyer shall have the
right to either (i) terminate this Agreement by giving written notice to Seller
and Escrow Holder and obtain the refund of the Deposits, or (ii) proceed with
the Close of Escrow and acquire the Property subject to such additional title
exceptions.  If necessary to remove such
additional title exception, Seller may extend the Close of Escrow for a period
of not more than thirty (30) days.

 

6.             Buyer’s Feasibility Conditions.  Buyer’s obligation to purchase the Property
under this Agreement shall be conditioned and contingent upon the satisfaction
or waiver in Buyer’s sole and absolute discretion of Buyer’s Feasibility
Conditions on or before the date that is ninety (90) days after the Effective
Date (“Feasibility Period”).

 

(a)           Buyer’s Feasibility Conditions.  Buyer’s Feasibility Conditions shall consist
of the following:

 

(i)            Title. 
Buyer’s approval of the state of title to the Property, including (i)
review and approval of the Title Report and of all documents constituting title
exceptions thereunder, (ii) review and approval of an ALTA Survey for the
Property (at Buyer’s option), and (iii) a determination that Escrow Holder will
issue at the Close of Escrow a title insurance policy in the amount of the
Purchase Price showing title to the Property vested in Buyer, subject only to
the Permitted Exceptions, with such endorsements as Buyer desires, in form and
content acceptable to Buyer (the “Owner’s Title Policy”).

 

(ii)           Due Diligence Documents.  Buyer’s review and approval of the Due Diligence Documents (as
defined in Section 7(a)).

 

(iii)          Project Approvals. 
Buyer’s determination (i) that Buyer’s intended use of the Property
conforms with all applicable zoning ordinances, subdivision laws, the
CC&R’s and all other land use laws and regulations to which the Property is
subject, (ii) that the City will not impose any undue restrictions on approvals
required for Buyer’s intended use of the Property; (iii) that Buyer will be
able to obtain all governmental approvals and permits necessary for Buyer’s
intended use of the Property; and (iv) that the Property is otherwise
satisfactory for Buyer’s intended use.

 

(iv)          Physical Inspection.  Buyer’s approval of such Physical Inspections (as defined in
Section 7(c)) which Buyer elects to undertake with respect to the Property
during

 

 

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the Feasibility Period.  All costs, expenses, liabilities or charges
incurred in or related to the performance of any and all such Physical
Inspections shall be the responsibility of Buyer.

 

(v)           Environmental Condition.  Buyer’s approval of the environmental condition of the Property,
such Environmental Investigations (as defined in Section 7(d)) which Buyer
elects to undertake with respect to the Property during the Feasibility Period
and Buyer’s review and approval of all studies, reports and documents relating
to the environmental condition of the Property and properties in the vicinity
of the Property, if any.  All costs,
expenses, liabilities or charges incurred in or related to the performance or
review of any Environmental Investigation shall be the responsibility of Buyer.

 

(vi)          Other Matters. 
Buyer’s investigation and approval of such other matters concerning the
Property as Buyer deems appropriate or necessary in its sole discretion.

 

(b)           Waiver or Satisfaction of Conditions.  Buyer’s Feasibility Conditions are solely
for the benefit of Buyer and may be waived by Buyer in writing.  If Buyer approves Buyer’s Feasibility
Conditions, Buyer shall give Seller and Escrow Holder written notice of such
approval not later than 5:00 p.m. Pacific Time on the last day of the
Feasibility Period.  If Buyer fails to
give written notice of approval of Buyer’s Feasibility Conditions prior to 5:00
p.m. Pacific Time on the last day of the Feasibility Period, this Agreement
shall be deemed terminated, the Initial Deposit and all interest accrued
thereon shall be returned to Buyer, and neither party shall have any further
obligation hereunder except for Buyer’s indemnity obligation under Section 7(e)
hereof.  Buyer’s failure to give its
notice of approval prior to 5:00 p.m. Pacific Time on the last day of the
Feasibility Period shall be deemed Buyer’s disapproval of Buyer’s Feasibility
Conditions.  Buyer’s timely notice of
approval of Buyer’s Feasibility Conditions shall serve as Buyer’s election to
proceed to the Close of Escrow and shall constitute Buyer’s acknowledgment that
Seller has given Buyer every opportunity to consider, inspect and review to its
satisfaction the physical, environmental, legal and economic condition of the
Property.  Notwithstanding the
foregoing, Buyer may elect at any time after the sixtieth (60th) day
of the Feasibility Period to waive Buyer’s Feasibility Conditions by giving
Seller and Escrow Holder written notice of such waiver.  If Buyer delivers such notice, the
Feasibility Period shall terminate upon Seller’s receipt of such notice, and the
Close of Escrow shall occur within fifteen (15) days after the effective date
of such termination.

 

7.             Due Diligence Documents; Right of Entry.

 

(a)           Due Diligence Documents.  Seller shall make available to Buyer for review during the
Feasibility Period, the following documents to the extent any such items exist
and are in the possession of Seller or its consultants (collectively, “Due
Diligence Documents”):

 

(i)            copies of all Phase I and Phase II reports and any other
environmental reports including all correspondence with the Monterey County Environmental
Health Department;

 

(ii)           copies of all contracts relating to the operation,
maintenance and management of the Property;

 

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(iii)          copies of property tax bills for the past three (3) years;

 

(iv)          copies of statements of operating expenses for the Property
for 2000, 2001 and 2002 including operating expense history and all capital
expenditures;

 

(v)           “as-built” construction plans for the Building and any
alterations, if any;

 

(vi)          copies of all leases, subleases and rental agreements that
will remain in effect after the Close of Escrow (other than the Lease)
pertaining to the Property, together with any amendments or addenda;

 

(vii)         a schedule of personal property included with the Property
as part of the sale, if any;

 

(viii)        a schedule of any offsite or onsite
improvement work Seller is obligated to complete, but has not yet completed,
and capital improvement work in process, if any;

 

(ix)           copies of all soils, environmental and engineering reports
pertaining to the Property;

 

(x)            copies of architectural, civil and structural
certificates of compliance, if any;

 

(xi)           copies of most recent fire department inspection reports,
if any;

 

(xii)          copies of any certificates of occupancy;

 

(xiii)         all materials provided to Seller by the
previous owner at the time Seller purchased the Property; and

 

(xiv)        copies of any existing ALTA surveys.

 

Seller makes no
representation or warranty with respect to the accuracy or completeness of any
of the Due Diligence Documents made available to Buyer except that the same are
true and correct copies of the documents in Seller’s possession.

 

(b)           Access to Due Diligence Documents.  Within seven (7) business days after the
Effective Date, Seller shall make the Due Diligence Documents available for
Buyer’s review.  The Due Diligence
Documents shall be available for review during the Feasibility Period by
appointment only during regular business hours on regular business days at IDT,
2975 Stender Way, Santa Clara, California 95054.  Buyer may request an appointment to review the Due Diligence
Documents by contacting James L. Laufman, Esq., General Counsel of IDT at (408)
492-8614.  Buyer may request copies of
the Due Diligence Documents during its review thereof, and Seller shall, within
three (3) business days after receipt of the request, provide the same to Buyer
subject to Buyer’s reimbursement of Seller’s reasonable costs in providing such
copies.

 

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Except for copies made by Seller, Buyer shall
not remove the Due Diligence Documents from their location.

 

(c)           Physical Inspection.  During the Feasibility Period, Buyer and Buyer’s employees,
agents, contractors and consultants (“Buyer’s Parties”) shall have the right to
enter the Property to perform such investigations and inspections of the
Property, including but not limited to soil, engineering, geological,
structural and visual tests and inspections (collectively, “Physical
Inspections”) of the Property as Buyer deems reasonably necessary at Buyer’s
sole cost and expense.  In conducting
such Physical Inspections, Buyer and Buyer’s Parties shall comply with all
applicable laws, statutes, ordinances, rules and regulations.  Buyer shall provide not fewer than three (3)
business days’ prior written notice to Seller at the address for notice set
forth in Section 16(a) below of any desired entry onto the Property by Buyer or
Buyer’s Parties to perform Physical Inspections, stating the date on which
Buyer desires such entry to occur, the name, address and telephone number of
the Buyer’s Party who will make the entry, and the nature and location on the
Property of the inspection to be performed. 
At Seller’s option, any Physical Inspection that Buyer desires to
perform within the Building may be scheduled before or after Seller’s regular
working hours so as not to interfere with Seller’s use and occupancy of the
Building.  Buyer shall promptly repair
any damage to the Building occurring as a result of a Physical Inspection to
the condition that existed prior to such damage at its sole cost and
expense.  Within five (5) days after
Buyer’s receipt thereof, Buyer shall provide Seller with copies of all reports,
data or test results resulting from any Physical Inspections.  All Physical Inspections shall be subject to
Section 7(e) hereof.

 

(d)           Environmental Investigations.  During the Feasibility Period, Buyer and
Buyer’s Agents may enter the Property to perform such non-invasive
environmental assessments of the Property (“Environmental Investigation”) which
Buyer elects to undertake at Buyer’s sole cost and expense with respect to the
Property; provided, however, in no event shall Buyer perform any “Phase II
Environmental Assessment” or any testing of soil and/or groundwater of the
Property (“Invasive Testing”) without Seller’s prior written consent and
compliance with this Section 7(d) . 
Prior to performing any Environmental Investigation, Buyer shall submit
to Seller at the address for notice set forth in Section 16(a) below, at least
five (5) business days prior to the date of Buyer’s proposed entry onto the
Property for such Environmental Investigation, the name of Buyer’s
environmental consultant who will conduct the investigation, evidence of the
consultant’s level of expertise and experience, and a description of the
Environmental Investigation to be performed. 
If the Environmental Investigation will occur within the Building,
Seller may require that such Environmental Investigation be performed either
before or after Seller’s regular working hours so as not to interfere with
Seller’s use and occupancy of the Building. 
If Buyer proposes any Invasive Testing, then in addition to the
foregoing information, Buyer shall submit to Seller the location of any
proposed borings for soil and/or groundwater sampling, the sampling and
analytical methods to be used, the chemical parameters and other conditions to
be tested, the health and safety plan to be followed, and the measures to be
taken to restore the affected areas to pre-existing conditions following
completion of the Invasive Testing. 
Seller shall give Buyer written notice of approval or disapproval of
Buyer’s Invasive Testing investigation plan within five (5) business days after
receipt of the foregoing information. 
If Seller reasonably objects to the environmental consultant or objects
to the Invasive Testing investigation plan proposed by Buyer, Seller shall give
Buyer written notice of such disapproval

 

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and the reasons therefor within said five (5)
business day period.  Thereafter, Seller
and Buyer shall promptly meet and negotiate in good faith to remove Seller’s
objections.  In the event that the
parties are unable to agree, Seller’s objections shall stand and Buyer may
either terminate the Agreement, choose another environmental consultant or
elect to revise its Invasive Testing investigation plan so as to remove
Seller’s objections.  Buyer shall, at
its sole cost and expense, obtain any and all permits and approvals required
from applicable governmental agencies prior to commencing any Invasive
Testing.  Buyer shall not install any
monitoring wells.  If Buyer seeks to
sample groundwater, Buyer shall do so through hydropunch or other geoprobe
sampling procedures.  Seller’s
representatives may be present at all times during the activities of Buyer
and/or Buyer’s Parties on the Property. 
Seller shall have the right, at Seller’s expense to take split samples
or verification samples from any Invasive Testing conducted by Buyer.  All Environmental Investigations shall be
subject to Section 7(e) hereof.

 

If any reports, studies,
tests, documents or information applicable to the environmental condition of
the Property arising out of an Environmental Investigation or any Invasive
Testing are required to be disclosed to a federal, state or local agency or
governmental body, then Buyer agrees that Seller shall be the party to furnish
such documentation to the applicable governmental agency having jurisdiction
over the Property and neither Buyer nor its agents, employees or environmental
consultants shall furnish such information to the applicable governmental
agencies.  If there is a demand for such
information generated by an Environmental Investigation or any Invasive Testing
by a governmental agency or by legal process issued by a court of competent
jurisdiction and Buyer has received actual notice of such demand, Buyer shall
promptly provide notice of such demand to Seller and afford Seller an
opportunity to impose any objections or defenses to such demand.  Buyer agrees that copies of all reports,
studies and other documents and information generated or prepared by or for
Buyer in connection with Buyer’s Environmental Investigations or any Invasive
Testing of the Property shall be furnished to Seller within five (5) business
days of Buyer’s receipt of same.

 

(e)           Insurance, Indemnity.  Buyer shall maintain and shall cause each Buyer’s Party entering
onto the Property to perform Physical Inspections, Environmental Investigations
or Invasive Testing to maintain a policy or policies of commercial general
liability insurance insuring against claims and liabilities arising directly
from or related to acts, omissions or investigations of Buyer and Buyer’s
Parties in, on, or about the Property. 
Such insurance shall have limits of not less than Two Million Dollars
($2,000,000.00) per occurrence, unless a lower limit is approved in writing by
Seller, and shall (i) specifically name Seller as an additional insured,
(ii) not be canceled or the coverage or liability limits reduced without
thirty (30) days prior written notice to Seller, (iii) insure the indemnity
obligations of Buyer as set forth below, and (iv) provide coverage which is
primary to any coverage carried by Seller and not in excess thereto.  Buyer shall deliver insurance certificates
to Seller prior to any entry onto the Property by Buyer or any of Buyer’s
Parties.  Buyer shall indemnify, defend
and hold Seller harmless from and against any and all claims, liabilities,
costs and expenses, including reasonable attorneys’ fees and other direct costs
that Seller may actually incur as a result of Buyer’s activities on the
Property,
including breach of the confidentiality provisions set forth
below.  All entries onto the Property
shall be arranged through Seller. 
Seller shall have the right to accompany Buyer and Buyer’s Parties in
connection with any entry onto the Property.

 

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(f)            Confidentiality. 
Buyer shall take reasonable precautions, and shall cause Buyer’s Parties
to take reasonable precautions, not to voluntarily disclose to others, except
to those acting within or on behalf of Buyer who have a business need to be
informed, any information, in whatever form, which is disclosed to or generated
by Buyer or Buyer’s Parties or provided by Seller as a result of Buyer’s access
to and/or review of the Due Diligence Documents, Buyer’s Physical Inspections,
Environmental Investigations and/or Invasive Testing.  Buyer agrees that the information contained in the Due Diligence
Documents or disclosed or generated by Buyer’s Physical Inspections,
Environmental Investigations and/or Invasive Testing shall be confidential and
shall be used for the limited purpose of deciding whether or not Buyer is
interested in purchasing the Property. 
The foregoing confidentiality agreement shall apply to both Buyer and
Buyer’s Parties.  The foregoing
confidentiality obligation shall not apply to (i) any information in the public
domain or which enters the public domain after the date of this Agreement other
than through Buyer’s failure to comply with this Section 7(f), (ii) any
information previously known to Buyer, or (iii) any information Buyer is
required by law to disclose.  In the
event that Buyer receives a demand for such information from a governmental
agency or by legal process issued by a court of competent jurisdiction, Buyer
shall promptly provide notice of such demand to Seller and afford Seller an
opportunity to impose any objections or defenses to such demand.  If the Purchase Agreement terminates for any
reason, Buyer shall deliver to Seller the originals and all copies of any and
all Due Diligence Documents previously delivered to Buyer by Seller.  In addition, Buyer shall promptly remove all
information and any reports, data, or test results from Buyer’s Physical
Inspections, Environmental Investigations and Invasive Testing from its files
and shall exercise best faith efforts to require such removal from those of its
employees, agents, attorneys and environmental consultants (subject to
Applicable Laws), and following consultation with and direction from Seller,
either destroy such information or forward the same to Seller.

 

8.             Buyer’s Conditions to Close of Escrow.  The Close of Escrow and Buyer’s obligation
to consummate the transactions contemplated by this Agreement are subject to
the satisfaction of the following conditions (or Buyer’s waiver thereof) for
Buyer’s benefit on or prior to the Close of Escrow:

 

(a)           Title Policy. 
The Title Company shall be committed to issue to Buyer the Owner’s Title
Policy insuring title vested in Buyer, subject only to the Permitted
Exceptions;

 

(b)           Delivery of Documents.  Seller shall have deposited into Escrow for delivery to Buyer at
the Close of Escrow the documents described and required pursuant to Section
11(a) of this Agreement;

 

(c)           Delivery of Lease. 
IDT shall have executed and delivered to Escrow Holder for delivery to
Buyer at the Close of Escrow a counterpart original of the Lease;

 

(d)           Delivery of Option Agreement.  IDT shall have executed and delivered to
Escrow Holder for delivery to Buyer at the Close of Escrow two counterpart
originals of the Option Agreement (as defined in Section 11(a)(vii); and

 

9

 

(e)           Seller’s Obligations.  Seller shall have timely performed all of its obligations
required by the terms of this Agreement to be performed by Seller.

 

If any of Buyer’s Closing
Conditions have not been satisfied by the Closing Date, then Buyer shall give
Seller and Escrow Holder written notice on or before the Closing Date
specifying the particular condition that has not been satisfied.  If Buyer delivers such notice, then Seller
may postpone the Close of Escrow for a period up to ten (10) days after the
scheduled Closing Date in order to permit Seller to take such action as is
necessary to cause the closing condition specified in Buyer’s notice to be
satisfied.  If the condition specified
in Buyer’s notice is not satisfied on the Closing Date, as extended, then Buyer
may terminate this Agreement by providing written notice of such termination to
Seller and Escrow Holder on or within fifteen (15) days after the extended
Closing Date.  If Buyer so terminates
this Agreement, Escrow Holder shall return the Deposit and all interest accrued
thereon to Buyer, and neither party shall have any further obligation hereunder
except for the indemnity obligations under Sections 7(e) and 14 hereof.

 

9.             Representation and Warranties.

 

(a)           Seller’s Representations and Warranties.  Seller hereby makes the following
representations and warranties to Buyer as of the Effective Date and as of the
Close of Escrow.  The phrase “to
Seller’s knowledge” as used in certain of the representations and warranties
shall mean the actual knowledge of James L. Laufman, Esq., General Counsel of
IDT, without any duty of investigation or inquiry.

 

(i)            Authority. 
Seller is duly and validly authorized to execute this Agreement and
perform all of its obligations hereunder. 
This Agreement is valid, binding and enforceable against Seller.

 

(ii)           Existing Agreement.  Neither Seller, nor to Seller’s knowledge, the Property, is
subject to any contract, agreement or restriction which would prevent the
consummation of the transactions contemplated by this Agreement.

 

(iii)          Actions. 
Seller has not received written notice of any action, suit or proceeding
affecting the Property, at law or in equity, pending before any federal, state
or municipal governmental department, commission, board, bureau, agency or
instrumentality.

 

(iv)          No Violations of Declaration.  To Seller’s knowledge, Seller has not
received written notice that the Property is in violation of any provision of
the Declaration of Covenants, Conditions and Restrictions executed by CC&F
Salinas Properties, Inc. and Salinas Associates and recorded on September 21,
1982, on Reel 1579, page 142, of the Official Records of Monterey County,
California (“CC&R’s”).

 

Seller shall not be liable
for breach of any of Seller’s representations or warranties set forth in this Section
9(a), Seller shall not be in default under this Agreement nor shall Buyer have
the right to terminate this Agreement due to the incorrectness of any of the
representations and warranties set forth in this Section 9(a) if, prior to the
Close of Escrow, either (A) as to matters

 

10

 

which are made to Seller’s knowledge, Seller
obtains information not known to James Laufman, Esq. on the Effective Date that
would make any of such representations and warranties incorrect and Seller
promptly discloses such information to Buyer, or (B) after the Effective Date,
Seller receives a notice of the type specified in Sections 11(a)(iii) or (iv),
and Seller promptly provides Buyer with a copy of such notice and provides
Buyer with a copy thereof.  If Buyer
receives any information not otherwise disclosed by Seller pursuant to the
foregoing sentence on or before the Close of Escrow that would make any of
Seller’s representations or warranties in this Section 9(a) untrue or incorrect
as of the Close of Escrow, then Buyer shall promptly disclose such information
to Seller and Buyer’s sole remedy shall be to either (i) terminate this
Agreement by giving written notice of such termination to Seller and Escrow
Holder, in which case this Agreement shall terminate, and Buyer shall be
entitled to the return of the Deposits, or (ii) to proceed with the Close of
Escrow despite such information, in which case Buyer shall be deemed to have
waived any claim against Seller resulting from the inaccuracy or incorrectness
of Seller’s representations and warranties as of the Close of Escrow based on
such information.  The representations
and warranties of Seller contained in this Section 9(a) shall survive the Close
of Escrow for a period of six (6) months. 
If Buyer has not filed an action for breach of such representations or
warranties within six (6) months of the Close of Escrow, Buyer shall thereafter
be precluded from ever making a claim or instituting any legal action, suit or
proceeding against Seller in connection with such representations and
warranties.

 

(b)           Buyer’s Representations.  Buyer represents and warrants to Seller that Buyer is a
corporation, duly organized, validly existing and in good standing in the State
of California, and has the capacity and full power and authority to enter into
and carry out the agreements contained in, and the transactions contemplated
by, this Agreement, and this Agreement has been duly authorized and executed by
Buyer, and upon delivery to and execution by Seller, shall be a valid and
binding agreement of Buyer.

 

(c)           Seller’s Covenants.  From the Effective Date until the earlier of the Close of Escrow
or the termination of this Agreement, Seller covenants to Buyer as follows:

 

(i)            Seller shall maintain the Property in the same condition
and manner as existed on the Effective Date, damage by casualty and reasonable
wear and tear excepted.

 

(ii)           Seller shall pay all bills and invoices for labor,
material and services supplied to the Property prior to the Close of Escrow,
except to the extent arising from Buyer’s activities on the Property.

 

(iii)          Seller shall maintain in full force any insurance coverage
pertaining to the Property, either through the existing insurance policies or
replacement policies.

 

(iv)          Seller shall not enter into any new contracts or
agreements, or modify any existing contracts or agreements relating to the
Property for a term beyond the Close of Escrow without the prior written
consent of Buyer, which Buyer may withhold in its sole and absolute discretion.

 

11

 

10.           “As Is” Acquisition.  Buyer acknowledges that Buyer owns certain real property in the
vicinity of the Property.  Buyer hereby
agrees and warrants that it has (i) inspected and is familiar with the Property
and the surrounding areas and the suitability for Buyer’s purposes.  Buyer represents and warrants that Buyer has
satisfied itself, or prior to the Close of Escrow will satisfy itself, as to
the physical, environmental, legal and economic condition of the Property and
its suitability for the purposes intended by Buyer.  Buyer acknowledges and agrees that Buyer is acquiring the
Property subject to all existing laws, ordinances, rules and regulations, and
that, except as expressly set forth in Section 9(a), neither Seller nor any of
Seller’s officers, directors, employees, agents, representatives and/or
attorneys (collectively, “Seller’s Agents”) have made any warranties,
representations or statements regarding the availability of any approvals, or
the laws, ordinances, rules or regulations of any governmental or
quasi-governmental body, entity, district or agency having authority with
respect to the ownership, possession, development, occupancy, condition and/or
use of the Property.  Except as
expressly set forth in Section 9(a), Seller disclaims the making of any
representations or warranties, express or implied, regarding the Property or
the Building, or matters affecting the Property, including, without limitation,
the physical condition of the Property and the Building, title to or boundaries
of the Property, soil condition, the presence of hazardous waste, hazardous
materials, toxic waste or other environmental matters, compliance of the
Property and Building with building, health, safety, land use and zoning laws,
regulations and orders, structural or other engineering characteristics of the
Building, traffic patterns and all other information pertaining to the
Property.  Buyer further acknowledges
that Seller has made no representation or warranty regarding the accuracy or
completeness of any reports or studies relating to the Property and/or Building
which may have been delivered or made available to Buyer other than that the
same are true and correct copies of the reports and studies available to
Seller.  Buyer moreover acknowledges
that (i) Buyer is a sophisticated investor, knowledgeable and experienced in
the financial and business risks attendant to an investment in real property
and capable of evaluating the merits and risks of entering into this Agreement
and purchasing the Property, (ii) that Buyer has entered into this Agreement
with the intention of making and relying upon its own or its experts
investigation of the physical, environmental, economic and legal condition of
the Property and the Building, including, without limitation, the compliance of
the Property and Building with laws and governmental regulations and the
operation of the Property and Building and/or whether the Property is located
in an area which is designated as a special flood hazard area, dam failure
inundation area, earthquake fault zone, seismic hazard zone, high fire severity
area or wildland fire area, by any federal, state or local agency, and (iii)
that Buyer is not, except as to any representations or warranties expressly set
forth in Section 9(a), relying on any representations and warranties made by
Seller or anyone acting or claiming to act on Seller’s behalf concerning the
Property.  Buyer hereby undertakes and
assumes the risks associated with all matters pertaining to the Property’s
location in any area designated as a special flood hazard area, dam failure
inundation area, earthquake fault zone, seismic hazard zone, high fire severity
area or wildland fire area, by any federal, state or local agency.  Buyer hereby acknowledges that it has not
received from Seller any accounting, tax, legal, architectural, engineering,
property management or other advice with respect to this transaction and is
relying upon the advice of its own accounting, tax, legal, architectural,
engineering, property management and other advisors.  Buyer shall purchase the Property in its “As Is” condition on the
Closing Date and assumes the risk that adverse physical, environmental,
economic or legal conditions may not have been

 

12

 

revealed by its investigations.  Seller shall have no liability for any
subsequently discovered defects, whether latent or patent.

 

Except with respect to the
representations and warranties set forth in Section 9(a), Buyer agrees that,
from and after the Close of Escrow, Buyer, for itself and its agents,
affiliates, successors and assigns, shall release and forever discharge Seller,
its agents, affiliates, successors and assigns from, and waives any right to
proceed against Seller for, any and all rights, claims and demands at law or in
equity relating to the physical, environmental, economic or legal condition of
the Property and/or Building.

 

Such release shall survive
the Close of Escrow.  Buyer has read and
has been fully advised of the contents of Section 1542 of the Civil Code
of the State of California, which reads as follows:

 

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

 

and, Buyer hereby expressly waives any and
all rights and the benefits of said section or any similar section of the laws
of any other applicable jurisdiction. 
Notwithstanding the foregoing, the waivers and release set forth above
are not intended to, and shall not, release or discharge liability for (i)
claims relating to indemnification under Section 14, (ii) any claims regarding
post-closing prorations pursuant to Section 11(d) below, and (iii) claims
arising from Seller’s intentional misrepresentation                          .

 

11.           Deposits Into Escrow.

 

(a)           Seller’s Deposits Into Escrow.  Seller shall deposit or cause to be deposited
into Escrow prior to the Close of Escrow the following:

 

(i)            An executed and acknowledged Grant Deed in the form
attached hereto as Exhibit ”C” (the “Grant Deed”);

 

(ii)           An assignment and bill of sale of all of Seller’s right,
title and interest in and to any Personal Property or intangible rights
pertaining to the Property in the form attached hereto as Exhibit “D” (the
“Assignment”);

 

(iii)          An executed Federal Non-Foreign Investor Affidavit in the
form attached hereto as Exhibit ”E” (the “FIRPTA Affidavit”);

 

(iv)          An executed Withholding Exemption Certificate (California
Form 593 (W) as required under the California Revenue and Taxation Code;

 

13

 

(v)           Two counterpart originals of an Assignment and Assumption
of Declaration of Covenants, Conditions and Restrictions in the form attached
hereto as Exhibit “F” (“CC&R Assignment”);

 

(vi)          Two counterpart originals of the Lease;

 

(vii)         Two counterpart originals of an Option Agreement in the form
attached hereto as Exhibit “G” (“Option Agreement”) whereby IDT grants Buyer an
option to purchase real property owned by IDT adjacent to the Property, the
effective date of which shall be the Close of Escrow; and

 

(viii)        Such other documents as may be
reasonably required to consummate this transaction.

 

(b)           Buyer’s Deposits Into Escrow.  Buyer shall deposit into Escrow prior to the
Close of Escrow the following:

 

(i)            The Purchase Price;

 

(ii)           Two counterpart originals of the CC&R Assignment;

 

(iii)          Two counterpart originals of the Lease;

 

(iv)          Two counterpart originals of the Option Agreement;

 

(v)           Such additional funds as may be required to pay Buyer’s
share of closing costs as provided herein; and

 

(vi)          Such other documents as may be reasonably required to
consummate this transaction.

 

(c)           Expenses of Escrow.  Seller shall pay (i) the CLTA premium for the Owner’s Title
Policy, (ii) all county documentary transfer taxes and (iii) one-half of the
escrow fees.  Buyer shall pay (i) the
ALTA portion of the premium for the Owner’s Title Policy, if Buyer elects ALTA
coverage, (ii) the cost of an ALTA survey, if Buyer elects to obtain the same;
(iii) the cost of any title endorsements Buyer elects to obtain, and (iv)
one-half of the escrow fees.  All other
reasonable and customary expenses, fees and costs incurred in connection with
the consummation of the Escrow, including, without limitation, document
preparation charges and recording fees, shall be borne by the parties hereto in
accordance with the custom and practice in Monterey County, California, or in
the absence of custom, equally between the parties.  Buyer and Seller shall each bear their own respective attorneys’
fees and accounting costs incurred in connection with this transaction.

 

(d)           Prorations. 
All real property taxes and assessments shall be prorated between Buyer
and Seller as of the Close of Escrow with appropriate debits and credits to the
accounts of Buyer and Seller so that, as between Buyer and Seller, Seller shall
pay all of the taxes and assessments to the extent allocable to the period
ending on the date immediately prior to the

 

14

 

Close of Escrow and Buyer shall pay all of
the taxes and assessments to the extent duly allocable to the period commencing
upon the Close of Escrow.  If the amount
of the current tax payment is not available, such proration shall be made on
the basis of the most recent tax information available at the Close of Escrow
and the parties shall make appropriate corrections promptly when accurate
information becomes available.  Any
corrected adjustment or prorations shall be paid in cash to the party entitled
thereto.

 

12.           Transfers and Assignments.  Buyer shall have the right to assign this
Agreement to a corporation, joint venture, partnership, limited liability
company or other similar entity, provided that Buyer and/or its principals
(including trusts of which the principals are trustors or settlors) has or have
at least a fifty percent (50%) interest in said entity.  Any assignment permitted under this section
shall not release Buyer of its obligations hereunder, and the assignee or
nominee under this Agreement shall assume all obligations of Buyer and agree to
execute all documents and to perform all obligations imposed on Buyer as if the
assignee or nominee was the original buyer under this Agreement.  Except as expressly set forth above, Buyer
shall not transfer or assign this Agreement or any of Buyer’s rights or
obligations hereunder without the prior written consent of Seller, which Seller
may withhold in its sole and absolute discretion.  Any such transfer or assignment made without Seller’s prior
written consent, if required hereunder, shall be void and of no force and
effect.  Subject to the foregoing, this
Agreement shall be binding upon and inure to the benefit of the successors and
assigns of the parties.

 

13.           Merger.

 

(a)           Title.  All
obligations, representations and warranties, express or implied, of Seller in
connection with the state of title to the Property shall merge in the Grant
Deed delivered to Buyer at the Close of Escrow.  Upon acceptance of title to the Property, Buyer expressly waives
any right of rescission and all claims for damages by reason of any obligation,
representation, warranty, promise or agreement pertaining to the state of title
to the Property.  By accepting title to
the Property, Buyer agrees to rely upon its policy of title insurance and shall
look solely to the title insurer of the Property in the event of any claims
concerning defects in or other matters affecting title to the Property which
are covered by such policy.

 

(b)             Merger of Obligations.  Unless expressly provided otherwise in this
Agreement, all obligations of Seller under this Agreement shall merge in and
shall not survive delivery of the Grant Deed to Buyer.

 

14.           Broker’s Commission.  The parties acknowledge that Colliers International (“Seller’s
Broker”) exclusively represents Seller and BT Commercial (“Buyer’s Broker”)
exclusively represents Buyer in this transaction.  Upon the Close of Escrow, Seller shall pay a real estate
brokerage commission to Seller’s Broker in connection with this transaction
pursuant to a separate agreement and Buyer shall pay a real estate brokerage
commission to Buyer’s Broker pursuant to a separate agreement.  Except with respect to Seller’s Broker and
Buyer’s Broker, each party represents and warrants to the other party that it
has not dealt with, nor does such representing party have any knowledge of, any
persons, firms or entities which would be entitled to a broker’s commission,
finder’s fee or the like in connection with the transactions contemplated by
this Agreement.  In the event any
warranty or representation made by a party in

 

15

 

this Section 14 proves to be false, such
party shall indemnify, defend and hold the other party harmless with respect to
any claims, losses, costs, liabilities and other expenses (including attorneys’
fees) which the other party may incur as a result of such breach or misrepresentation.  The foregoing obligation shall survive the
Close of Escrow.

 

15.           Remedies.

 

(a)           Liquidated Damages.  BUYER RECOGNIZES THAT THE PROPERTY WILL BE REMOVED FROM THE
MARKET DURING THE EXISTENCE OF THIS AGREEMENT. 
BUYER ACKNOWLEDGES THAT IF IT DEFAULTS IN ITS PERFORMANCE HEREUNDER
PRIOR TO OR AT THE CLOSE OF ESCROW, SELLER SHALL BE ENTITLED TO COMPENSATION
FOR THE DETRIMENT RESULTING FROM THE REMOVAL OF THE PROPERTY FROM THE
MARKET.  THE PARTIES HERETO AGREE THAT
THE DAMAGES THAT SELLER SHALL SUSTAIN AS A RESULT OF SUCH BREACH WILL BE
EXTREMELY DIFFICULT AND IMPRACTICABLE TO ASCERTAIN.  THEREFORE, THE PARTIES AGREE THAT IF THE CLOSE OF ESCROW FAILS TO
OCCUR AS A RESULT OF A BREACH BY BUYER OF ITS OBLIGATIONS HEREUNDER, SELLER
SHALL BE ENTITLED TO RETAIN OR RECOVER THE SUM OF THE INITIAL DEPOSIT AND
ADDITIONAL DEPOSIT (i.e., THREE HUNDRED THOUSAND DOLLARS ($300,000.00)) AS ITS
EXCLUSIVE REMEDY AGAINST BUYER, AT LAW OR IN EQUITY, FOR BREACH OF BUYER’S
COVENANT TO PURCHASE THE PROPERTY (BUT NOT FOR BREACH OF THE MATTERS SET FORTH
IN THE FOLLOWING SENTENCE), AND SAID SUM SHALL BE PAID AND RECEIVED AS
LIQUIDATED DAMAGES AND NOT AS A PENALTY. 
EXCEPT WITH RESPECT TO BUYER’S BREACH OF ANY INDEMNITY OBLIGATION OR ANY
OTHER OBLIGATION OF BUYER HEREUNDER (OTHER THAN THE COVENANT TO PURCHASE THE
PROPERTY) WHICH SURVIVES THE CLOSE OF ESCROW (WHICH BREACH SHALL ENTITLE SELLER
TO SEEK ANY AND ALL REMEDIES AVAILABLE AT LAW AND IN EQUITY AND FOR WHICH
BREACH THIS SECTION 15 SHALL NOT APPLY), BOTH PARTIES ACKNOWLEDGE AND
AGREE THAT SAID AMOUNT IS PRESENTLY A REASONABLE ESTIMATE OF SELLER’S DAMAGES
IN THE EVENT OF BUYER’S BREACH OF ITS OBLIGATION TO PURCHASE THE PROPERTY
CONSIDERING ALL OF THE CIRCUMSTANCES EXISTING ON THE DATE OF THIS AGREEMENT,
INCLUDING THE RELATIONSHIP OF THE SUM TO THE RANGE OF HARM TO SELLER THAT
REASONABLY COULD BE ANTICIPATED AND THE ANTICIPATION THAT PROOF OF ACTUAL
DAMAGES WOULD BE IMPRACTICAL OR EXTREMELY DIFFICULT.  BY INITIALING THIS SECTION BELOW, THE PARTIES HERETO SIGNIFY
THEIR APPROVAL AND CONSENT TO THE TERMS OF THIS SECTION.

 

	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Seller’s Initials

  	
   

  	
  Buyer’s
  Initials

  	
   

  

 

(b)           Buyer’s Remedies. 
If the Close of Escrow does not occur because of an uncured material
default by Seller under this Agreement at the Close of Escrow, Buyer’s sole and
exclusive remedies shall be to either (i) terminate this Agreement by delivery
of notice of

 

16

 

termination to Seller, whereupon Seller shall
return to Buyer the Initial Deposit and Additional Deposit or (ii) continue
this Agreement pending Buyer’s action for specific performance.

 

16.           General Provisions.

 

(a)           Notices. 
Any notice, request, demand, consent, approval or other communication
required or permitted hereunder or by law shall be in writing and shall be
deemed duly given (i) when personally delivered, (ii) sent by overnight courier
providing evidence of receipt of delivery, or (iii) by United States mail,
registered or certified mail, postage prepaid, return receipt requested, to the
addresses set forth below or to such other address of which the parties are
subsequently notified in writing:

 

	
   

  	
  Seller:

  	
  BACCARAT SILICON INC.

  
	
   

  	
   

  	
  C/o Integrated Device
  Technology, Inc.

  
	
   

  	
   

  	
  2975 Stender Way

  
	
   

  	
   

  	
  Santa Clara, California
  95054

  
	
   

  	
   

  	
  Attn:

  	
  James L. Laufman, Esq.

  
	
   

  	
   

  	
   

  	
  General Counsel

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  With a copy to:

  	
  Berliner Cohen

  
	
   

  	
   

  	
  10 Almaden Boulevard,
  Eleventh Floor

  
	
   

  	
   

  	
  San Jose, California 95113

  
	
   

  	
   

  	
  Attn:

  	
  Steven J. Casad, Esq.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Buyer:

  	
  Dan Caputo Co.

  
	
   

  	
   

  	
  1530-A Parkmoor Avenue

  
	
   

  	
   

  	
  San Jose, CA 95128-2406

  
	
   

  	
   

  	
  Attn:

  	
  Mr. Phil Rolla

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  With a copy to:

  	
  Hefner, Stark and Marois,
  LLP

  
	
   

  	
   

  	
  2150 River Plaza Drive,
  Suite 450

  
	
   

  	
   

  	
  Sacramento, CA 95833

  
	
   

  	
   

  	
  Attn:

  	
  Joel S. Levy, Esq.

  

 

Notices shall be deemed delivered upon
receipt.  Any party may change its
address for notice by giving written notice of such change to the other party.

 

(b)           Legal Fees. 
In the event either party brings an action or suit against the other
party by reason of any breach of any of the covenants or agreements on the part
of the other party arising out of this Agreement, then, in that event, the
prevailing party in such action or dispute, whether by final judgment or out of
court settlement, shall be entitled to have and recover of and from the other
party all reasonable costs and expenses of suit, including reasonable
attorneys’ fees.

 

(c)           Waiver of Jury Trial.  Buyer and Seller each acknowledge and agree that any controversy
which may arise under this Agreement would be based upon difficult and

 

17

 

complex issues, and therefore, Buyer and
Seller each hereby waive any right to a trial by jury in any action or
proceeding to enforce or defend any rights under this Agreement and agree that
any such action or proceeding shall be tried in a court of competent jurisdiction
by a judge and not by a jury.

 

(d)           Survival of Indemnities.  Buyer’s indemnity obligation under Sections 7(e) and 14 of this
Agreement shall survive the recordation of the Grant Deed at the Close of
Escrow.  Seller’s indemnity obligations
under Section 14 hereof shall survive the recordation of the Grant Deed at the
Close of Escrow.

 

(e)           Required Actions of Buyer and Seller.  Buyer and Seller agree to execute such
instruments and documents and to diligently undertake such actions as may be
reasonably required in order to consummate the purchase and sale herein
contemplated and shall use their diligent efforts to accomplish the Close of
Escrow in accordance with the provisions hereof.

 

(f)            Time of Essence. 
Time is of the essence of each and every term, condition, obligation,
and provision hereof.

 

(g)           Counterparts. 
This Agreement may be executed in multiple counterparts, each of which
shall be deemed an original but all of which, together, shall constitute one
and the same instrument.

 

(h)           Captions.  Any
captions to, or headings of, the paragraphs or subparagraphs of this Agreement
are solely for the convenience of the parties hereto, are not a part of this
Agreement, and shall not be used for the interpretation or determination of the
validity of this Agreement or any provision hereof.

 

(i)            No Obligations to Third Parties.  Except as otherwise expressly provided
herein, the execution and delivery of this Agreement shall not be deemed to
confer any rights upon, nor obligate any of the parties hereto, to any person
or entity other than the parties hereto.

 

(j)            Exhibits. 
The Exhibits attached hereto are hereby incorporated herein by this
reference.

 

(k)           Amendment to this Agreement.  The terms of this Agreement may not be
modified or amended except by an instrument in writing executed by each of the
parties hereto.

 

(l)            Waiver. 
The waiver or failure to enforce any provision of this Agreement shall
not operate as a waiver of any future breach of any such provision or any other
provision hereto.

 

(m)          Applicable Law. 
This Agreement shall be governed by and construed in accordance with the
laws of the State of California.

 

(n)           Fees and Other Expenses.  Except as otherwise provided herein, each of the parties shall
pay its own fees and expenses in connection with this Agreement.

 

18

 

(o)           Severability. 
If any provision of this Agreement is, or hereinafter is adjudged to be,
for any reason void, unenforceable, or invalid, it is the specific intent of
the parties that the remainder hereof shall be and remain in full force and
effect.

 

(p)           Entire Agreement. 
This Agreement supersedes any prior agreement, oral or written, and
contains the entire agreement between Buyer and Seller as to the subject matter
hereof.  No subsequent agreement,
representation, or promise made by either party hereto, or by or to an
employee, officer, agent, or representative of either party shall be of any
effect unless it is in writing and executed by the party to be bound thereby.

 

(q)             Applications. 
Buyer intends to apply for and process applications for permits and
other governmental approvals that may be required for Buyer to construct tenant
improvements in the Building after the Close of Escrow.  Seller agrees to cooperate with Buyer, at no
cost to Seller, by executing as the owner of the Property such applications as
may be reasonably necessary for Buyer to construct such tenant improvements;
provided, however, in no event shall any such permits or other governmental
approvals be finalized or be binding upon the Property until after the Close of
Escrow.  Buyer shall keep Seller
informed of the progress of its applications for such permits and governmental
approvals.  In no event shall Seller’s
execution of applications for permits or other governmental approvals for
Buyer’s tenant improvements constitute a representation or warranty by Seller
of the accuracy or completeness of Buyer’s improvement plans, the absence of
design defects or flaws therein, or compliance with applicable statutes, laws
and ordinances and Buyer shall indemnify, defend and hold Buyer harmless from
any claims made against Seller arising out of the improvements that are the
subject of the applications for permits or other governmental approvals
executed by Seller.

 

17.           Damages and Destruction.  If, prior to Close of Escrow, the Property is damaged by a
casualty which is not caused by the negligence or activities of Buyer or
Buyer’s Parties on the Property and which casualty results in a loss that
exceeds Two Hundred Fifty Thousand Dollars ($250,000), and if, in any such
case, the damage is not repaired by the Closing Date, then Buyer, at its
option, may elect, within five (5) days after the date of such casualty, to
terminate this Agreement, in which case the Deposit shall be returned to Buyer,
and neither party shall have any further obligation hereunder except for the
indemnities in Section 7(e) and 14; or (ii) proceed with the Close of
Escrow, in which case Seller shall assign to Buyer at the Close of Escrow all
proceeds of insurance paid or payable with respect to the casualty, without any
reduction in the Purchase Price.

 

IN WITNESS WHEREOF, Buyer
and Seller have executed this Agreement as of the day and year first above
written.

 

	
   

  	
  “SELLER”

  
	
   

  	
   

  	
   

  
	
   

  	
  BACCARAT SILICON INC.,

  a California corporation

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Its:

  	
   

  

 

19

 

 

	
   

  	
  “BUYER”

  
	
   

  	
   

  	
   

  
	
   

  	
  DAN CAPUTO CO.,

  a California corporation

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Its:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Its:

  	
   

  

 

 

20

 

EXHIBIT
“A”

LEGAL
DESCRIPTION OF PROPERTY

 

Lot 5, as shown on the map entitled, “Tract
No. 922, Unit No. 1 Salinas Airport Business Center, filed for record May 6,
1981 in Volume 14 of “Cities and Towns,” at page 57, Monterey County Records.

 

Assessors Parcel No. 003 863 007

 

 

 

1

 

EXHIBIT ”B”

 

LEASE AGREEMENT

 

THIS LEASE AGREEMENT
(“Lease”) is made as of this
                 
(       ) day of
              ,
2003, by and between 1566 MOFFETT LLC, a California limited liability company
(“Landlord”), and INTEGRATED DEVICE TECHNOLOGY, INC., a Delaware corporation
(“Tenant”).

 

WITNESSETH:

 

Landlord hereby leases to
Tenant and Tenant hereby leases from Landlord those certain premises consisting
of the entire second floor, as shown on the floor plan attached hereto as
Exhibit “A-1”, and those portions of the first floor not included in Landlord’s
“Construction Areas” (as defined in Section 5), as shown on the floor plan
attached hereto as Exhibit “A-2” (collectively “Premises”) of that certain
building located at 1566 Moffett Street, Salinas, California (“Building”).  As used herein, the term “Project” shall
mean the Building, consisting of approximately ninety-eight thousand sixty
(98,060) square feet, the land upon which the Building is situated and any and
all other improvements, fixtures and equipment now or hereafter situated on
such land. The parties acknowledge that Tenant is leasing the Premises from
Landlord following the sale of the Project by Tenant’s affiliate, Baccarat
Silicon Inc. to Landlord, while new facilities for the operation of Tenant’s
business are constructed on real property in the vicinity of the Project.  Landlord hereby leases the Premises to
Tenant, and Tenant hereby leases the Premises from Landlord, upon the following
terms and conditions:

 

1.             Use. 
Tenant shall use the Premises for office, testing, laboratory,
warehouse, sales and marketing or other related uses allowed by the City of
Salinas.

 

2.             Term.  The
term (“Lease Term”) shall commence on the date that a grant deed for the
Project executed by Baccarat Silicon Inc. in favor of Landlord is recorded in
the Official Records of Monterey County, California (“Commencement Date”) and
end, unless sooner terminated, on January 31, 2004 (“Expiration Date”), subject
to extension in accordance with the following sentence.  Tenant shall have the right to extend the
Lease Term for three (3) consecutive one month periods (i.e., February 1 to
February 29, 2004, March 1 to March 31, 2004, and April 1 to April 30, 2004;
each such period, an “Extension”), by delivering written notice of such
Extension to Landlord not less than thirty (30) days prior to the effective
date of such Extension.

 

3.             Possession. 
The parties acknowledge that Tenant is in possession of the Premises as
of the Commencement Date.

 

4.             Monthly Rent.

 

(a)           Basic Rent. 
Tenant shall pay to Landlord monthly installments of basic rent for the
Premises in the amount of Twenty-one Thousand Four Hundred Fifty Dollars
($21,450) per month.  If Tenant
exercises its right to extend the Lease Term for one or more Extensions, basic
rent for the first Extension shall be Thirty-two Thousand One Hundred
Seventy-five Dollars ($32,175), basic rent for the second Extension shall be
Forty-two Thousand Nine Hundred Dollars ($42,900) and basic rent for the third
Extension shall be Fifty-three Thousand Six Hundred Twenty-five Dollars
($53,625).  Basic rent shall be paid in
advance, on or before the first day of each and every calendar month of the Lease
Term.  Notwithstanding the foregoing,
Tenant shall pay the basic rent for the first month of the Lease on the

 

 

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Commencement Date.  If the Commencement Date is not the first day of a calendar month,
then the first monthly installment of base rent shall be prorated at the rate
of 1/30th of the monthly basic rent per day.

 

(b)           Common Area Charges.  In addition to the above basic rent and as additional rent,
Tenant shall pay to Landlord the sum of Thirty-six Thousand Nine Hundred Twelve
Dollars ($36,912.00) on or before the first day of the first (1st)
full calendar month of the Lease Term and on the first day of each and every
successive calendar month, said sum representing Tenant’s payment of “common
area charges”. Payment of common area charges for any partial month shall be
payable in advance and shall be prorated at the rate of 1/30th of the monthly
payment of common area charges per day. 
If Tenant vacates the Premises in its entirety prior to the expiration
of the Lease Term, then Tenant shall have no further obligation for payment of
common area charges for the remainder of the Lease Term, the common area charge
for the calendar month in which Tenant vacates the Premises shall be prorated
as specified above, and Landlord shall return to Tenant any prorated portion of
such common area charge applicable to the portion of such calendar month after
the date of such vacation.  As used in
this Lease, “common area charges” shall mean Tenant’s contribution to the costs
incurred by Landlord under Paragraphs 9 (Maintenance and Repair), 11
(Insurance), 12 (Utilities), 13 (Taxes) and 15 (Common area maintenance).  Landlord and Tenant agree and acknowledge
that the common area charges are a reasonable estimate of Tenant’s anticipated
share of the common area charges that will be incurred by Tenant on a monthly
basis under this Lease, and that such monthly amount shall be binding on the
parties.  Subject to Section 12, Tenant’s
sole obligation with respect to such common area charges shall be payment of
the monthly common area charge set forth in this Paragraph 4(b), and Tenant
shall have no further obligation with respect to such charges, even if the
actual common area charges incurred by Landlord are higher or lower than the
monthly amount set forth in this Paragraph 4(b).

 

(c)           Manner and Place of Payment.  All payments of basic rent and common area
charges shall be paid to Landlord, without demand, deduction or offset, in
lawful money of the United States of America, at 1530-A Parkmoor Avenue, San
Jose, California 95128-2406, or to such other person or place as Landlord may
from time to time designate in writing.

 

5.             Relocation of Premises; Renovation Work.  The parties acknowledge that as of the
Commencement Date, Tenant’s operations and personnel will be located throughout
the first floor of the Building, including portions of the first floor located
within the Construction Areas.  Within
fifteen (15) days after the Commencement Date, Tenant shall relocate its operations
and personnel in the Construction Areas into the Premises at Tenant’s sole cost
and expense.  The parties further
acknowledge that after the Commencement Date, Landlord intends to perform the
renovation work more particularly described on Exhibit “B” attached hereto
(“Renovation Work”) in those areas of the first floor of the Building
(“Construction Areas”) delineated on the floor plan attached hereto as Exhibit
“A-2” (“Construction Plan”).  All
Renovation Work shall be performed in a manner that will not unreasonably
disturb or interfere with Tenant’s operations and personnel in the
Building.  Landlord shall use diligent
efforts to minimize any dust, noise, vibrations and other disturbances from the
Renovation Work.  In no event shall
Tenant be required to move any furniture, equipment or personal property within
the Premises for the Renovation Work, except Tenant shall move furniture,
fixtures and equipment in the Construction Areas into the Premises.  During the Renovation Work, all areas of the
Building not included in the Construction Areas shall be reasonably undisturbed
and remain clean and safe in their current condition, including, without
limitation, all Building entrances and corridors not included in the
Construction Areas, elevators, all stairways to and from the second floor, and
the break room and restrooms on the first floor of the Building.  Tenant understands and agrees that Landlord
may, prior to the end of the Lease Term, place another tenant or tenants in
possession of the portions of the Building comprising the Construction Areas
(or any part thereof) upon completion of all or part of the Renovation Work;
provided, however, Landlord hereby agrees and acknowledges that no such
delivery of possession shall occur unless and until Landlord shall have erected
and installed, at

 

 

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Landlord’s sole cost and expense, any
demising walls and/or partitions reasonably necessary to maintain the security
of the Premises and to prevent entry into the Premises by unauthorized
persons.  Subject to causes or events
beyond Landlord’s reasonable control, Landlord shall at all times during the
Renovation Work maintain utility service and heating, ventilating and air
conditioning to the Premises during Tenant’s regular working hours.  Any disruption to the utility service and
heating, air conditioning and ventilating resulting from the Renovation Work
shall occur outside of Tenant’s regular working hours and only with the prior
written permission of Tenant’s Facilities Support Manager.  All of Tenant’s existing voice, data and
alarm cabling shall remain undisturbed until Tenant vacates the Premises.  Landlord’s construction personnel shall
enter and exit the Building at locations reasonably designated by Tenant and
shall not enter the Premises without prior written consent from, and
arrangement with, Tenant’s on-site Facilities Support Manager.

 

6.             Restriction on Use. Tenant shall not do or permit
to be done anything in or about the Premises or the Project which will
constitute waste or use or allow the Premises to be used for any unlawful
purpose, nor shall Tenant cause, maintain or permit any nuisance in or about
the Premises or the Project.  Tenant
shall not do anything in the Premises that will cause damage to the
Building.  No waste materials or refuse
shall be dumped upon or permitted to remain upon any part of the Premises or
the Project except in trash containers designated for that purpose by Landlord,
or where otherwise designated by Landlord; and no toxic or hazardous materials
shall be disposed of through the plumbing or sewage system.  No materials, supplies, equipment, finished
products or semi-finished products, raw materials or articles of any nature shall
be stored or permitted to remain outside of the Building.

 

7.             Compliance with Laws.  Tenant shall, in connection with its use and occupancy of the
Premises, at its sole cost and expense, promptly observe and comply with (i)
all laws, statutes, ordinances and governmental rules, regulations and
requirements of federal, state, county, municipal and other governmental
authorities, now or hereafter in effect, which shall impose any duty upon
Tenant with respect to the use or occupancy of the Premises, (ii) the
requirements of any board of fire underwriters or other similar body now or
hereafter constituted and (iii) any direction or occupancy certificate issued
pursuant to law by any public authority; provided, however, that nonobservance
and/or noncompliance shall not be deemed a breach of these provisions if
Tenant, immediately upon notification, commences, at Tenant’s sole cost and
expense, to remedy or rectify such nonobservance and/or noncompliance.  In no event shall Tenant be required to make
any alterations or additions to the Premises in order to cause the same to
comply with applicable laws, statutes, ordinances or governmental rules and
regulations.

 

8.             Alterations. 
Tenant shall not make, or cause or allow to be made, any alteration,
addition or improvement to or of the Premises or any part thereof (collectively
referred to herein as “alterations”) without (i) the prior written consent of
Landlord, (ii) a valid building permit issued by the appropriate governmental
authority and (iii) otherwise complying with all applicable laws, regulations
and requirements of governmental agencies having jurisdiction and with the
rules, regulations and requirements of any board of fire underwriters or
similar body.  Any alterations made by
Tenant (excluding moveable furniture and trade fixtures not attached to the
Premises) shall at once become a part of the Premises and belong to
Landlord.  If Landlord consents to the
making of any alteration by Tenant, the same shall be made by Tenant at its
sole risk, cost and expense and only after Landlord’s written approval of any
contractor or person selected by Tenant for that purpose, and the same shall be
made at such time and in such manner as Landlord may from time to time
designate.  Upon the expiration or
sooner termination of the Lease Term, Landlord may, at its sole option, require
Tenant, at Tenant’s sole cost and expense, to promptly both remove any such
alteration made by Tenant during the Lease Term and designated by Landlord to
be removed and repair any damage to the Premises caused by such removal, and restore
the Premises to the condition that existed prior to such alteration.  If during the Lease Term any alteration,
addition or change of the Premises is required by law, regulation, ordinance or
order of any public authority, Landlord, at its sole cost and expense, shall
promptly make the same.

 

 

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9.             Repair and Maintenance.  Tenant hereby agrees that the Premises shall be taken in “as-is”
condition, “with all faults,” “without representation or warranties.”  Except as expressly provided below, Tenant
shall at its sole cost keep and maintain in good condition and repair the
interior of the Premises including, without limitation, the interior windows,
doors and all door hardware, the interior walls and partitions. Upon the
expiration or earlier termination of this Lease, Tenant shall surrender the
Premises in the same condition as received, ordinary wear and tear and damage
by fire, earthquake, act of God or the elements alone excepted.  Tenant agrees to repair in a workmanlike and
professional manner any damage to the Premises caused by or in connection with
the removal of any articles of personal property, business or trade fixtures,
machinery, equipment, cabinetwork, furniture, movable partitions or permanent
improvements or additions, including, without limitation thereto, patching the
floor and walls, at Tenant’s sole cost and expense.  Subject to the provisions of Section 17, Landlord shall keep
and maintain the roof, structural elements, heating, ventilating and air
conditioning, lighting, electrical, plumbing, mechanical and life-safety
systems, the Building entrances, those portions of the Building outside of the
Premises, the exterior walls of the Building and the Common Area in good order
and repair.  Tenant waives all rights
under and benefits of California Civil Code Sections 1932(1), 1941, and
1942 and under any similar law, statute or ordinance now or hereafter in
effect.  The cost of the repairs and
maintenance which are the obligation of Landlord hereunder, including without
limitation, maintenance contracts and supplies, materials, equipment and tools
used in such repairs and maintenance shall be a common area charge.

 

10.           Liens. 
Tenant shall keep the Premises and the Project free from any liens
arising out of any work performed, materials furnished or obligations incurred
by Tenant, its agents, employees or contractors.  Should any such lien be recorded against the Project, Tenant
shall give immediate notice of such lien to Landlord.  In the event that Tenant shall not, within fifteen (15) days
following the imposition of such lien, cause the same to be released of record,
Landlord shall have, in addition to all other remedies provided herein and by
law, the right, but not the obligation, to cause the same to be released by
such means as it shall deem proper, including payment of the claim giving rise
to such lien.  All sums paid by Landlord
for such purpose, and all expenses (including attorneys’ fees) incurred by it
in connection therewith, shall be payable to Landlord by Tenant on demand with
interest at the rate of ten percent (10%) per annum.  Landlord shall have the right at all times to post and keep
posted on the Premises any notices permitted or required by law, or which
Landlord shall deem proper for the protection of Landlord, the Premises and the
Building and any other party having an interest therein, from mechanics’ and
materialmen’s liens and like liens. 
Tenant shall give Landlord at least fifteen (15) days prior notice of
the date of commencement of any construction on the Premises in order to permit
the posting of such notices.

 

11.           Insurance. 
Tenant, at its sole cost and expense, shall keep in force during the
Lease Term (i) commercial general liability and property damage insurance with
a combined single limit of at least $2,000,000 per occurrence insuring against
personal or bodily injury to or death of persons occurring in, on or about the
Premises or Project and any and all liability of the insureds with respect to
the Premises or arising out of Tenant’s maintenance, use or occupancy of the
Premises and all areas appurtenant thereto, and (ii) Worker’s Compensation
Insurance as required by law.  Tenant’s
commercial general liability insurance shall be endorsed to provide that said
insurance shall not be canceled or reduced except upon at least thirty (30)
days prior written notice to Landlord. 
Further, Tenant’s commercial general liability insurance shall be
primary and shall be endorsed to provide that Landlord and any of its partners,
members, officers, directors and employees and such other persons or entities
as directed from time to time by Landlord shall be named as additional
insureds.  The commercial general
liability insurance carried by Tenant shall specifically insure the performance
by Tenant of the indemnification provisions set forth in Section 18 of
this Lease. Such policy shall be endorsed to agree that Tenant’s policy is
primary and that any insurance covered by Landlord is excess and not
contributing with any insurance requirement hereunder.  Any insurance carried by Landlord or any of
the additional insureds named on Tenant’s insurance policies shall be excess
and

 

 

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noncontributing with the insurance so provided
by Tenant.  Tenant shall, prior to the
Commencement Date, provide Landlord with a completed Certificate of Insurance
attaching thereto copies of all endorsements required to be provided by Tenant
under this Lease.

 

Landlord shall obtain and
keep in force a policy or policies of insurance covering loss or damage to the
Premises and Building, in the amount of the full replacement value thereof,
providing protection against those perils included within the classification of
“all risk” insurance, with increased cost of reconstruction and contingent
liability (including demolition).  The
cost of the foregoing insurance purchased by Landlord shall be a common area
charge.

 

Landlord and Tenant hereby
mutually waive any and all rights of recovery against one another for real or
personal property loss or damage occurring to the Premises or the Building, or
any part thereof, or to any personal property therein, from perils insured
against under fire and extended insurance and any other property insurance
policies existing for the benefit of the respective parties.  Any policy or policies of fire, extended or
similar casualty insurance which either party obtains in connection with the
Premises shall include a clause or endorsement denying the insurer any rights
of subrogation against the other party to the extent any rights have been
waived by the insured prior the occurrence of injury or loss.

 

12.           Utilities and Service.  Landlord and Tenant acknowledge that the monthly common area
charge paid by Tenant under Paragraph 4(b) above includes Tenant’s payment of
its percentage share of the cost of all water, gas, light, heat, power,
electricity, trash pickup, sewer charges and all other services supplied to or
consumed on the Premises. 
Notwithstanding the foregoing, if the utility bills for gas and/or
electricity for the Building exceed one hundred ten percent (110%) of the
average amount of the utility costs paid by Tenant for the six (6) months prior
to the Commencement Date, then in addition to the monthly payment made by
Tenant under Section 4(b), Tenant shall pay to Landlord its proportionate share
of the increase in such utility costs, within fifteen (15) days after Tenant’s
receipt of Landlord’s invoice therefor. 
Similarly, if the utility bills for gas and/or electricity for the
Building are less than ninety percent (90%) of the average amount of the
utility costs paid by Tenant for the six (6) months prior to the Commencement
Date, then Landlord shall reimburse Tenant its proportionate share of the
decrease in such utility costs, within fifteen (15) days after Landlord’s
receipt of the utility invoice showing such decreased cost.  Tenant shall arrange for its own telephone
service and pay its telephone bills directly. 
Landlord shall not be liable for, and Tenant shall not be entitled to,
any abatement or reduction of rent by reason of, the failure of any person or
entity to furnish any of the foregoing services when such failure is caused by
accident, breakage, repairs, strikes, lockouts or other labor disturbances or
labor disputes of any character, governmental moratoriums, regulations or other
governmental actions, or by any other cause, similar or dissimilar, beyond the
reasonable control of Landlord.

 

13.           Taxes and Other Charges.  Landlord and Tenant acknowledge that the monthly common area
charge paid by Tenant under Paragraph 4(b) includes Tenant’s payment of its
percentage share of all real estate taxes and assessments and other taxes, fees
and charges which are levied, assessed or imposed upon Landlord and/or against
the Premises, Common Area or Project, or any part thereof by any federal,
state, county, regional, municipal or other governmental or quasi-public
authority (other than state and federal personal or corporate income taxes
measured by the net income of Landlord from all sources, and premium
taxes).  Tenant agrees to pay, before
delinquency, any and all taxes levied or assessed during the Lease Term upon
Tenant’s equipment, furniture, fixtures and other personal property located in
the Premises.  If any of Tenant’s
personal property shall be assessed with the Building, Tenant shall pay to
Landlord, as additional rent, the amount attributable to Tenant’s personal
property within ten (10) days after receipt of a written statement from
Landlord setting forth the amount of such taxes, assessments and public charges
attributable to Tenant’s personal property.

 

 

5

 

 

14.           Entry by Landlord. 
Landlord reserves, and shall have the right, upon at least twenty-four (24)
hours prior notice and compliance with Tenant’s security procedures including
escort by a Tenant employee, except in an emergency, to enter the Premises (i)
to inspect the Premises, (ii) to supply services or make repairs required to be
provided or made by Landlord hereunder, and (iii) to post notices required or
allowed by this Lease or by law. 
Landlord shall use reasonable efforts to minimize any interference with
Tenant’s use or occupancy of the Premises during any such entry.

 

15.           Common Area; Parking.  Subject to the terms and conditions of this Lease, Tenant and
Tenant’s employees and invitees shall have the nonexclusive right to use the
driveways, sidewalks and parking areas of the Project, the Building entrances,
interior corridors, stairways and elevators in the Building providing access to
the Premises, the first-floor breakroom and restrooms, and the refuse disposal
areas.  The foregoing areas, as well as
the roof (provided, however, Tenant shall in no event have access to the roof),
Building exterior and Project landscaping are referred to herein as “Common
Area.”

 

Tenant shall have the
nonexclusive use of the parking spaces in the Common Area.  Tenant shall not at any time park or permit
the parking of Tenant’s trucks or other vehicles, or the trucks or other
vehicles of others, adjacent to loading areas so as to interfere in any way
with the use of such areas; nor shall Tenant at any time park or permit the
parking of Tenant’s vehicles or trucks, or the vehicles or trucks of Tenant’s
suppliers or others, in any portion of the Common Area not designated by
Landlord for such use by Tenant.  Tenant
shall not park or permit any inoperative vehicle or equipment to be parked on
any portion of the Common Area.

 

Landlord shall operate,
manage and maintain the Common Area in a manner that is at least consistent
with the operation, management and maintenance of the Common Area prior to the
Commencement Date.  The cost of such
maintenance, operation and management of the Common Area, including maintenance
of landscaping, maintenance and cleaning of parking lots and sidewalks,
interior corridors, stairways and elevators in the Building and the first-floor
breakroom, shall be a common area charge.

 

16.           Intentionally Omitted.

 

17.           Damage by Fire; Casualty.  In the event the Premises are damaged by any casualty which is
covered under an insurance policy required to be maintained by Landlord
pursuant to Section 11, Landlord shall be entitled to the use of all
insurance proceeds and, subject to this Section 17 below, shall repair such
damage as soon as reasonably possible and this Lease shall continue in full
force and effect.

 

In the event the Premises
are damaged by any casualty not covered under an insurance policy required to
be maintained pursuant to Section 11, Landlord may, at Landlord’s option,
either (i) repair such damage, at Landlord’s expense, as soon as reasonably
possible, in which event this Lease shall continue in full force and effect, or
(ii) give written notice to Tenant within thirty (30) days after the date of
the occurrence of such damage of Landlord’s intention to cancel and terminate
this Lease as of the date of the occurrence of the damage.  Under no circumstances shall Landlord be
required to repair any injury or damage to (by fire or other cause), or to make
any restoration or replacement of, any of Tenant’s personal property, trade
fixtures or property leased from third parties, whether or not the same is
attached to the Premises.  If the
Premises are totally destroyed during the Lease Term from any cause, whether or
not covered by the insurance required under Section 11, this Lease shall
automatically terminate as of the date of such total destruction.
Notwithstanding the foregoing, if the Premises are damaged by any casualty and
cannot be restored within thirty (30) days after the date of such damage,
Tenant shall have the right to terminate this Lease effective as of the date of
such damage by giving written notice of such termination to Landlord within
thirty (30) days after the date of such damage.

 

 

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If the Premises are
partially or totally destroyed or damaged and Landlord repairs them pursuant to
this Lease, the rent payable hereunder for the period during which such damage
and repair continues shall be abated in proportion to the square footage of the
Premises rendered untenantable to Tenant by such damage or destruction.  Tenant shall have no claim against Landlord
for any damage, loss or expense suffered by reason of any such damage,
destruction, repair or restoration.  The
parties waive the provisions of California Civil Code sections 1932(2) and
1933(4) (which provisions permit the termination of a lease upon destruction of
the leased premises), and hereby agree that the provisions of this
Section 17 shall govern in the event of such destruction.

 

18.           Indemnification. 
Tenant shall indemnify, defend (with counsel reasonably acceptable to
Landlord) and hold Landlord harmless from and against any claim, liability,
loss, damage or expense (including attorneys’ fees) arising from (i) Tenant’s
breach of its obligations under this Lease, (ii) Tenant’s use of the Premises
during the Lease Term, or (iii) any act, neglect, fault or omission of Tenant
or its agents or employees.

 

Landlord shall indemnify,
defend (with counsel reasonably acceptable to Tenant) and hold Tenant harmless
from and against any claim, liability, loss, damage or expense (including
attorneys’ fees) arising (i) from Landlord’s breach of its obligations under
this Lease, and (ii) from any act, neglect, fault or omission of Landlord, or
its agents, contractors or employees.        The provisions of this Section 18 shall
survive the expiration or earlier termination of this Lease.

 

19.           Assignment and Subletting.  Tenant shall not voluntarily assign,
encumber or otherwise transfer its interest in this Lease or in the Premises,
or sublease all or any part of the Premises, or allow any other person or
entity to occupy or use all or any part of the Premises, without first
obtaining Landlord’s written consent (which consent shall not be unreasonably
withheld).  Any assignment, encumbrance
or sublease without Landlord’s consent, shall constitute a default.  Notwithstanding the foregoing, Tenant may
assign the Lease or sublet the Premises to an “Affiliate” of Tenant without
Landlord’s prior written consent, but with prior written notice to
Landlord.  As used herein, an
“Affiliate” shall mean any person or entity, controlled by, controlling or
under common control with Tenant

 

20.           Default.  The occurrence of any of the following shall constitute a default
by Tenant:

 

(i)            the vacating or abandonment of the Premises by Tenant;
provided, however, Tenant shall not be in default if Tenant has vacated the
Premises so long as Tenant continues to pay Basic Rent and common area charges
and otherwise perform the obligations of Tenant under this Lease;

 

(ii)           failure of Tenant to pay any rent or any other sum payable
under this Lease within five (5) days after Tenant’s receipt of written notice
from Landlord that the same is due;

 

(iii)          failure of Tenant to observe or perform any other term,
covenant or condition of this Lease if the failure to observe or perform is not
cured within twenty (20) days after notice thereof has been given to Tenant
(provided that if such default cannot reasonably be cured within twenty (20)
days, Tenant shall not be in default and shall have such additional time as may
be reasonably necessary to cure such failure to observe or perform so long as
Tenant commences to cure such failure to observe or perform within the twenty
(20) day period and diligently and in good faith continues to cure the failure
to observe or perform);

 

 

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(iv)          the making by Tenant of any general assignment or general
arrangement for the benefit of creditors; or the filing by or against Tenant of
a petition to have Tenant adjudged a bankrupt, or a petition for reorganization
or arrangement under any law relating to bankruptcy (unless, in the case of a
petition filed against Tenant, the same is dismissed within sixty (60) days);
or the appointment of a trustee or a receiver to take possession of
substantially all of Tenant’s assets located at the Premises or of Tenant’s
interest in this Lease, where possession is not restored to Tenant within
fifteen (15) days; or the attachment, execution or other judicial seizure of
substantially all of Tenant’s assets located at the Premises or of Tenant’s
interest in this Lease, where such seizure is not discharged within fifteen
(15) days; and

 

(v)           Provided Landlord gives Tenant written notice at least
five (5) days’ prior to the expiration of Tenant’s existing insurance policy,
Tenant’s failure, prior to the expiration date of any insurance policy required
to be maintained by Tenant pursuant to this Lease, to furnish Landlord with
renewals or binders with respect to such insurance policies.

 

In the event of a default by
Tenant, then Landlord, in addition to any other rights and remedies of Landlord
at law or in equity, shall have the right either to terminate Tenant’s right to
possession of the Premises (and thereby terminate this Lease) or, from time to
time and without termination of this Lease, to relet the Premises or any part
thereof for the account and in the name of Tenant for such term and on such
terms and conditions as Landlord in its sole discretion may deem
advisable.  Should Landlord at any time
terminate this Lease for any breach, in addition to any other remedy it may have,
it shall have the immediate right of entry and may remove all persons and
property from the Premises and shall have all the rights and remedies of a
landlord provided by California Civil Code Section 1951.2 or any successor
code section.  Upon such termination, in
addition to all its other rights and remedies, Landlord shall be entitled to
recover from Tenant all damages it may incur by reason of such breach,
including the cost of recovering the Premises and including (i) the worth at
the time of award of the unpaid rent which had been earned at the time of
termination; (ii) the worth at the time of award of the amount by which the
unpaid rent which would have been earned after termination until the time of
award exceeds the amount of such rental loss that Tenant proves could have been
reasonably avoided; (iii) the worth at the time of the award of the amount by
which the unpaid rent for the balance of the Lease Term after the time of award
exceeds the amount of such rental loss that Tenant proves could be reasonably
avoided; and (iv) any other amount necessary to compensate Landlord for all the
detriment proximately caused by Tenant’s failure to perform its obligations
under this Lease or which in the ordinary course of events would be likely to
result therefrom.  The “worth at the
time of award” of the amounts referred to in (i) and (ii) above is computed by
allowing interest at the rate of twelve percent (12%) per annum.  The “worth at the time of award” of the
amount referred to in (iii) above shall be computed by discounting such amount
at the discount rate of the federal reserve bank of San Francisco at the time
of award plus one percent (1%). 
Property removed from the Premises may be stored in a public or private
warehouse or elsewhere at the sole cost and expense of Tenant.  In the event that Tenant shall not
immediately pay the cost of storage of such property after the same has been
stored for a period of thirty (30) days or more, Landlord may sell any or all
thereof at a public or private sale in such manner and at such times and places
that Landlord, in its sole discretion, may deem proper, without notice to or
demand upon Tenant.

 

21.           Eminent Domain. 
If all or any part of the Premises shall be taken by any public or
quasi-public authority under the power of eminent domain or conveyance in lieu
thereof, this Lease shall terminate as to any portion of the Premises so taken
or conveyed on the date when title vests in the condemnor, and Landlord shall
be entitled to any and all payments, income, rent, award or any interest
therein whatsoever which may be paid or made in connection with such taking or
conveyance.  Tenant shall have no claim
against Landlord or otherwise for the value of any unexpired term of this
Lease.  Notwithstanding the foregoing,
Tenant shall be entitled to any compensation for depreciation to and cost of
removal of Tenant’s equipment and fixtures and any compensation for its
relocation expenses necessitated

 

 

8

 

 

by such taking, but in each case only to the
extent the condemning authority makes a separate award therefor or specifically
identifies a portion of the award as being therefor.  Each party waives the provisions of Section 1265.130 of the
California Code of Civil Procedure (which section allows either party to petition
the Superior Court to terminate this Lease in the event of a partial taking of
the Premises).

 

In the event of a partial
taking, or conveyance in lieu thereof, of the Premises, then Tenant may
terminate this Lease as of the date of such taking if Tenant determines that
the remaining portion of the Premises is not satisfactory for Tenant’s
use.  Any election by Tenant to so
terminate shall be by written notice given to Landlord within thirty (30) days
from the date of such taking or conveyance. 
If a portion of the Premises is taken by power of eminent domain or
conveyance in lieu thereof and neither Landlord nor Tenant terminates this
Lease as provided above, then this Lease shall continue in full force and
effect as to the part of the Premises not so taken or conveyed and all payments
of rent shall be apportioned as of the date of such taking or conveyance so
that thereafter the amounts to be paid by Tenant shall be in the ratio that the
area of the portion of the Premises not so taken bears to the total area of the
Premises prior to such taking.

 

22.           Notice and Covenant to Surrender.  On the expiration or earlier termination of
the Lease Term, Tenant shall surrender to Landlord the Premises in the
condition existing as of the Commencement Date (normal wear and tear
excepted).  On or prior to the
expiration of the Lease Term, Tenant shall, at Tenant’s sole cost and expense,
remove all of Tenant’s personal property, furniture, equipment and trade
fixtures from the Premises and repair any damage caused by such removal.  Any personal property not removed shall be
deemed abandoned.

 

23.           Holding Over. 
Any holding over after the expiration or termination of this Lease with
the written consent of Landlord shall be construed to be a tenancy from month
to month at a monthly rent equal to the basic rental in effect for the last
Extension exercised by Tenant.  All
provisions of this Lease, except those pertaining to the term and any
Extension, shall apply to the month to month tenancy.

 

24.           Certificate of Estoppel.  Tenant shall, within fifteen (15) calendar days after request
therefor, execute and deliver to Landlord, a certificate stating that this
Lease is unmodified and in full force and effect, or in full force and effect
as modified and stating the modifications. 
The certificate shall also state the amount of the monthly rent, the
date to which monthly rent has been paid in advance, and shall include such
other items as Landlord may reasonably request.  Failure to deliver such certificate within such time shall constitute
a conclusive acknowledgment by Tenant that this Lease is in full force and
effect and has not been modified except as may be represented by the party
requesting the certificate.  Any such
certificate requested by Landlord may be conclusively relied upon by any
prospective purchaser or encumbrancer of the Premises or Project.

 

25.           Attorneys’ Fees. 
If either party commences an action against the other party arising out
of or in connection with this Lease, the prevailing party shall be entitled to have
and recover from the losing party all expenses of litigation, including,
without limitation, travel expenses, attorneys’ fees, expert witness fees,
trial and appellate court costs, and deposition and transcript expenses.

 

26.           Waiver.  No
delay or omission in the exercise of any right or remedy of Landlord on any
default by Tenant shall impair such right or remedy or be construed as a
waiver.  The receipt and acceptance by
Landlord of delinquent rent or other payments shall not constitute a waiver of
any other default and acceptance of partial payments shall not be construed as
a waiver of the balance of such payment due. 
Landlord’s consent to or approval of any act by Tenant requiring
Landlord’s consent or approval shall not be deemed to waive or render
unnecessary Landlord’s consent to or approval of any subsequent act by

 

 

9

 

 

Tenant. 
Any waiver by Landlord of any default must be in writing and shall not
be a waiver of any other default concerning the same or any other provision of
this Lease.

 

27.           Notices. 
All notices, demands, requests, consents and other communications which
may be given or are required to be given by either party to the other shall be
in writing and shall be sufficiently made and delivered if personally served or
if sent by United States first class mail, postage prepaid.  All such communications from Landlord to
Tenant shall be served or addressed to Tenant at Integrated Device Technology,
Inc., 2975 Stender Way, Santa Clara, CA 95054, Attn:  James L. Laufman, Esq., General Counsel.  All such communications by Tenant to
Landlord shall be sent to Landlord at its offices at 1530-A Parkmoor Avenue,
San Jose, California 95128-2406.  Either
party may change its address by notifying the other of such change. Each such
communication shall be deemed received on the date of the personal service or
mailing thereof in the manner herein provided, as the case may be.

 

28.           Governing Law; Severability.  This Lease shall in all respects be governed
by and construed in accordance with the laws of the State of California.  If any provision of this Lease shall be held
or rendered invalid, unenforceable or ineffective for any reason whatsoever,
all other provisions hereof shall be and remain in full force and effect.

 

29.           Interest on Past Due Obligations; Late Charge.  Any amount due from one party to the other
party hereunder which is not paid when due shall bear interest at the rate of
ten percent (10%) per annum from when due until paid, unless otherwise
specifically provided herein, but the payment of such interest shall not excuse
or cure any default by such delinquent party. 
In addition, Tenant acknowledges that late payment by Tenant to Landlord
of basic rent or common area charges or of any other amount due Landlord from
Tenant, will cause Landlord to incur costs not contemplated by this Lease, the
exact amount of such costs being extremely difficult and impractical to
fix.  Such costs include, without limitation,
processing and accounting charges, and late charges that may be imposed on
Landlord, e.g., by the terms of any encumbrance and note secured by any
encumbrance covering the Premises. 
Therefore, if any such payment due from Tenant is not received by Landlord
within five (5) days after Tenant’s receipt of written notice from Landlord
that such payment is due, Tenant shall pay to Landlord an additional sum of
five percent (5%) of the overdue payment as a late charge.  The parties agree that this late charge
represents a fair and reasonable estimate of the costs that Landlord will incur
by reason of late payment by Tenant.

 

30.           Entire Agreement. 
This Lease, including any exhibits and attachments, constitutes the
entire agreement between Landlord and Tenant relative to the Premises and this
Lease and the exhibits and attachments may be altered, amended or revoked only
by an instrument in writing signed by both Landlord and Tenant.  Landlord and Tenant agree that all prior or
contemporaneous oral agreements between and among themselves or their agents or
representatives relative to the leasing of the Premises are merged in or
revoked by this Lease.

 

31.           Corporate Authority.  Each party represents and warrants to the other that this Lease
has been duly authorized by such party, and that upon execution and delivery to
the other party, shall constitute a valid and binding obligation of such party.

 

32.           Real Estate Brokers.  Tenant shall not be responsible for payment of any leasing
commissions or fees arising out of this Lease. 
Each party shall indemnify and hold harmless the other party from all
damage, loss, liability and expense (including attorneys’ fees and related
costs) arising out of or resulting from any claims for commissions or fees that
may or have been asserted against the other party by any broker, finder or
other person with whom Tenant or Landlord has or purportedly has dealt with in
connection with the Premises and the negotiation and execution of this Lease.

 

 

10

 

 

33.           Exhibits and Attachments.  All exhibits and attachments to this Lease are a part hereof.

 

34.           Environmental Matters.

 

(a)           Environmental Law Compliance.  During the Lease Term, Tenant shall comply
with all Environmental Laws and Environmental Permits (each as defined in Section
34(c) below) applicable to the operation or use of the Premises, will cause all
other persons occupying or using the Premises to comply with all such
Environmental Laws and Environmental Permits, and will immediately pay or cause
to be paid all costs and expenses incurred by reason of such compliance.

 

(b)           Indemnity. 
Tenant agrees to defend, indemnify and hold harmless Landlord from and
against all obligations (including removal and remedial actions), losses,
claims, suits, judgments, liabilities, penalties, damages, costs and expenses
(including attorneys’ and consultants’ fees and expenses) incurred by, imposed
on or asserted against Landlord based on, or arising or resulting from the
actual presence of Hazardous Materials in the Premises which is caused by
Tenant during the Lease Term.

 

(c)           Definitions. 
As used herein, the following terms shall have the following
meanings:  “Hazardous Materials” means
(i) petroleum or petroleum products, natural or synthetic gas, asbestos in any
form that is or could become friable, urea formaldehyde foam insulation, and
radon gas; (ii) any substances defined as or included in the definition of
“hazardous substances,” “hazardous wastes,” “hazardous materials,” “extremely
hazardous wastes,” “restricted hazardous wastes,” “toxic substances,” “toxic
pollutants,” “contaminants” or “pollutants,” or words of similar import, under
any applicable Environmental Law; and (iii) any other substance exposure to
which is regulated by any governmental authority.  “Environmental Law(s)” means any federal, state or local statute,
law, rule, regulation, ordinance, code, policy or rule of common law now or
hereafter in effect and in each case as amended, and any judicial or
administrative interpretation thereof, including any judicial or administrative
order, consent decree or judgment, relating to the environment, health, safety
or Hazardous Materials, including without limitation, the Comprehensive
Environmental Response, Compensation, and Liability Act of 1980, 42 U.S.C. §§
9601 et seq.; the Resource Conservation and Recovery Act, 42 U.S.C. §§ 6901 et
seq.; the Hazardous Materials Transportation Act, 49 U.S.C. §§ 1801 et seq.;
the Clean Water Act, 33 U.S.C. §§ 1251 et seq.; the Toxic Substances Control
Act, 15 U.S.C. §§ 2601 et seq.; the Clean Air Act, 42 U.S.C. §§ 7401 et seq.;
the Safe Drinking Water Act, 42 U.S.C. §§ 300f et seq.; the Atomic Energy Act,
42 U.S.C. §§ 2011 et seq.; the Federal Insecticide, Fungicide and Rodenticide
Act, 7 U.S.C. §§ 136 et seq.; the Occupational Safety and Health Act, 29 U.S.C.
§§ 651 et seq.  “Environmental Permits”
means all permits, approvals, identification numbers, licenses and other
authorizations required under any applicable Environmental Law.

 

35.           Signage. 
Tenant shall not, without obtaining the prior written consent of
Landlord, install or attach any new or additional sign or advertising material
on any part of the outside of the Building. 
Tenant may maintain any existing signs on the Building or Premises until
the expiration of the Lease Term.

 

 

11

 

 

IN WITNESS WHEREOF, Landlord
and Tenant have executed and delivered this Lease on the date first above
written.

 

	
   

  	
  LANDLORD:

  
	
   

  	
   

  	
   

  
	
   

  	
  1566 MOFFETT LLC,

  a California limited liability company

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Its:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Its:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  TENANT:

  
	
   

  	
   

  	
   

  
	
   

  	
  INTEGRATED DEVICE
  TECHNOLOGY, INC.

  a Delaware corporation

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Its:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Its:

  	
   

  

 

 

12

 

 

EXHIBIT
“A-1”

 

FLOOR
PLAN OF SECOND FLOOR PREMISES

 

[To
be attached]

`

 

 

1

 

 

EXHIBIT
“A-2”

 

FLOOR
PLAN OF FIRST FLOOR SHOWING CONSTRUCTION AREAS

 

[To
be attached]

 

 

 

1

 

 

EXHIBIT
“B”

 

RENOVATION
WORK

 

The Renovation Work shall consist of the
following work performed in the following Construction Areas as shown on the
Construction Plan attached hereto as Exhibit “A-2”:

 

Area A.0-Warehouse Area

 

The work to be completed is
heating, ventilating and air conditioning, new lighting, electrical
distribution, voice data cabling, painting and flooring.

 

Area A.1-Area Around Laser
Room

 

Landlord shall first
construct a dust barrier around the laser room and adjacent HVAC
equipment.  The barrier will be placed
in such a manner as to allow Tenant’s staff access to the laser room from the
corridor without having to enter the construction area.  The work to be performed in this area is
demolition of the wall as shown on Exhibit “C”, removal of the existing T-bar
ceiling, distribution from the existing HVAC system, new T-bar ceiling and
lighting, electrical distribution, voice/data cabling, painting and flooring.

 

Area A.2-Vacant Offices

 

The work to be completed in
this area is removal of the existing T-bar ceiling, lighting and flooring and
subdivision of the area into six private offices complete with revised HVAC
distribution, relocated fire sprinkler heads, new T-bar ceiling and lighting,
voice/data cabling, painting and flooring. 
All work will be confined to within the existing perimeter walls of the
existing office areas.

 

Area D-Detached Building to
Northwest of Main Building

 

The work to be completed in
this area is the complete demolition of the building to slab surface.

 

Area E-Covered Breezeway
adjacent to Area D

 

The work to be completed in
this area is the construction of a dock high truck well with a dock high
leveler for one full-sized truck and trailer.

 

 

 

1

 

 

EXHIBIT ”C”

 

GRANT
DEED

 

 

Order
No.

Escrow
or Loan No.

 

RECORDING
REQUESTED BY AND

WHEN
RECORDED MAIL TO:

 

Dan Caputo
Co.

 

	
  Attn:

  	
   

  	
   

  	
   

  	
  SPACE ABOVE THIS LINE FOR
  RECORDER’S USE

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Mail Tax Statements to:

  	
   

  	
  The undersigned grantor
  declares:

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Documentary Transfer Tax
  is shown on a separate sheet attached to this deed and is not a part of the
  public record.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Attn:

  	
   

  	
   

  	
   

  	
   

  	
   

  
							

 

A.P.N. 
003-863-007

 

GRANT DEED

 

FOR VALUABLE CONSIDERATION, receipt of which
is hereby acknowledged,

 

BACCARAT SILICON INC., a California
corporation,

 

hereby GRANTS to DAN CAPUTO CO., a California
corporation

 

that certain real property in the City of
Salinas, County of Monterey, State of California, more particularly described
as follows:  See Attachment 1

 

This Grant is made subject to all covenants,
conditions, restrictions, exceptions, easements, rights-of-way, rights of
access, agreements, reservations, encumbrances, liens and other matters of
record; any matter which would be disclosed by accurate survey, investigation
or inquiry; any tax, assessment or other governmental lien against the
property; and subject to existing environmental conditions (if any) including
conditions arising from past uses affecting the property.

 

	
   

  	
   

  	
   

  	
  BACCARAT SILICON INC.,

  a California corporation

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  
	
  Dated:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Its:

  	
   

  

 

 

1

 

 

	
   

  	
  DO NOT RECORD

  
	
   

  	
   

  
	
   

  	
  FILOR REQUESTS

  DO NOT RECORD STAMP VALUE

  

 

NOTE: 
This Declaration is not a public record

 

Document #

 

DECLARATION OF TAX DUE:  SEPARATE PAPER:

(Revenue and Taxation Code 11932-11933)

 

DOCUMENTARY TRANSFER TAX IS $

 

o            Computed on full value

 

o            Computed on full value less liens or encumbrances
remaining at the time of conveyance

 

APN: 
003-863-007

 

Property located in:

 

o            Unincorporated

 

ý            City of Salinas

 

CITY CONVEYANCE TAX IS $   N/A

 

	
   

  	
   

  
	
  Signature of party
  determining tax

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  Name (Typed or Printed)

  	
   

  

 

 

2

 

 

	
  STATE OF CALIFORNIA

  	
   

  	
   

  
	
   

  	
  }

  	
  ss.

  
	
  COUNTY OF

  	
   

  	
   

  

 

On
                                  ,
before me,
                                             ,
personally appeared
                                   ,

 

  personally known to me —OR-  proved to me on the basis of satisfactory
evidence to be the person(s) whose name(s) is/are subscribed 

	
   

  	
  to the within instrument
  and acknowledged to me that he/she/they executed the same in his/her/their
  authorized capacity(ies), and that by his/her/their signature(s) on the
  instrument the person(s), or the entity upon behalf of which the person(s)
  acted, executed the instrument.

  
	
   

  	
   

  	
   

  
	
   

  	
  WITNESS my hand and
  official seal.

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  SIGNATURE
  OF NOTARY

  	
   

  

 

CAPACITY CLAIMED BY SIGNER

 

Though statute does not require the Notary to
fill in the data below, doing so may prove invaluable to persons relying on the
document.

 

	
   

  	
  INDIVIDUAL

  CORPORATE OFFICERS(S)

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Title(s)

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  PARTNER(S)

  	
  LIMITED

  	
   

  
	
   

  	
   

  	
  GENERAL

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  ATTORNEY-IN-FACT

  TRUSTEE(S)

  GUARDIAN/CONSERVATOR

  OTHER:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  SIGNER IS REPRESENTING:

  	
   

  	
   

  
	
   

  	
  Name of Person(s) or
  Entity(ies)

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  

 

 

3

 

 

ATTACHMENT
1

 

LEGAL
DESCRIPTION OF PROPERTY

 

Lot 5, as shown on the map entitled, “Tract
No. 922, Unit No. 1 Salinas Airport Business Center, filed for record May 6,
1981 in Volume 14 of “Cities and Towns,” at page 57, Monterey County Records.

 

Assessors Parcel No. 003 863 007

 

 

 

 

4

 

 

EXHIBIT ”D”

 

Blanket
Assignment and Bill of Sale

 

Reference is hereby made to
that certain property located in the City of Salinas, County of Monterey, State
of California and more particularly described on Exhibit A attached
hereto and made a part hereof and the improvements located thereon and the
rights, privileges and entitlements incident thereto (the “Property”).  For good and valuable consideration, receipt
of which is hereby acknowledged, BACCARAT SILICON INC., a California
corporation (“Seller”), hereby sells, transfers, assigns, conveys and delivers
to DAN CAPUTO CO.,  a California
corporation (“Buyer”) (i) all personal property owned by Seller located on
and used exclusively in the use or operation of the Property, if any (“Personal
Property”); (ii) all entitlements and other agreements relating to the
development of Property; (iii) all plans, specifications, maps, drawings
and other renderings relating to the improvements on the Property;
(iv) all warranties, claims and any similar rights relating to and
benefiting the Property; (v) all intangible rights and similar rights
benefiting the Property; and (vi) all development rights benefiting the
Property.

 

Any Personal Property is
conveyed in its “as is with all faults” basis. 
Buyer acknowledges that it has made its own inspection of the Personal
Property and is not relying on any representation or warranty of any kind
whatsoever, express or implied, from Seller as to any matters concerning the
Personal Property, including, without limitation, any implied warranties of
merchantability or fitness for a particular purpose.

 

	
   

  	
  BACCARAT SILICON INC.,

  
	
   

  	
  a California corporation

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  

 

 

 

1

 

 

EXHIBIT
A

 

LEGAL
DESCRIPTION OF PROPERTY

 

Lot 5, as shown on the map entitled, “Tract
No. 922, Unit No. 1 Salinas Airport Business Center, filed for record May 6, 1981
in Volume 14 of “Cities and Towns,” at page 57, Monterey County Records.

 

Assessors Parcel No. 003 863 007

 

 

 

2

 

 

EXHIBIT
“E”

 

CERTIFICATION
OF NON-FOREIGN STATUS

(Entity
Transferor)

 

Section 1445 of the Internal
Revenue Code provides that a transferee of a U.S. real property interest must
withhold tax if the transferor is a foreign person.  To inform the transferee that withholding of tax is not required
upon the disposition of a U.S. real property interest by BACCARAT SILICON INC.,
the undersigned hereby certifies the following on behalf of BACCARAT SILICON
INC.:

 

1.             BACCARAT SILICON INC. is not a foreign corporation,
foreign partnership, foreign trust or foreign estate (as those terms are
defined in the Internal Revenue Code and Income Tax Regulations);

 

2.             BACCARAT SILICON INC.’s U.S. employer identification
number is
                                  ;
and

 

3.             BACCARAT SILICON INC.’s office address is c/o Integrated
Device Technology, Inc., 2975 Stender Way, Santa Clara, California 95054, Attn:
James L. Laufman, Esq., General Counsel.

 

BACCARAT SILICON INC.
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.

 

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 BACCARAT SILICON INC.

 

	
   

  	
   

  	
   

  	
  BACCARAT SILICON INC.,

  
	
   

  	
   

  	
   

  	
  a California corporation

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Dated:

  	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Its:

  	
   

  

 

 

 

1

 

 

EXHIBIT
“F”

 

ASSIGNMENT
AND ASSUMPTION OF DECLARATION OF COVENANTS, CONDITIONS

AND RESTRICTIONS

 

THIS ASSIGNMENT AND
ASSUMPTION OF DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS
(“Assignment”) is executed effective as of
         , 2003 (the “Effective
Date”) by and between BACCARAT SILICON INC., a California corporation
(“Assignor”), and DAN CAPUTO CO., a California corporation (“Assignee”).

 

RECITALS

 

A.            Assignor is the owner of certain real property located in
the City of Salinas, County of Monterey, State of California more particularly
described in Exhibit A attached hereto (“Property”).  Pursuant to a grant deed of even date
herewith, Assignor is conveying the Property to Assignee.

 

B.            The Property is subject to that certain Declaration of
Covenants, Conditions and Restrictions dated as of September 13, 1982 and
recorded on September 21, 1982 in Reel 1579, Page 142 in the Official Records
of Monterey County, California (“Declaration”).

 

C.            In connection with the conveyance of the Property to
Assignee, Assignor desires to assign to Assignee all of Assignor’s right,
title, interest, duties and obligations under the Declaration with respect to
the Property.

 

NOW, THEREFORE, for valuable
consideration, receipt of which is hereby acknowledged, Assignor and Assignee
hereby agree as follows:

 

1.             Assignor does hereby assign, transfer and convey to
Assignee all of Assignor’s right, title, interest, duties and obligations in,
to or under the Declaration with respect to the Property arising from and after
the Effective Date.

 

2.             Assignee hereby accepts the foregoing assignment, and
hereby assumes all of the right, title, interest, duties and obligations of
Assignor in, to and under the Declaration with respect to the Property arising
from and after the Effective Date. 
Assignee hereby acknowledges the obligations of Assignor under the
Declaration and agrees to be bound by the Declaration.

 

3.             This Assignment may be executed in counterparts, each of
which shall be an original, but all of which shall constitute one
instrument.  In addition, counterpart
signature pages may be (but shall not be required to be) annexed to one
Assignment.  It is the intent hereof
that when both parties have executed one or more counterparts, this Assignment
shall be in full force and effect.

 

 

1

 

 

IN WITNESS WHEREOF, the
parties hereto have executed this Assignment on the dates set forth below, to
be effective as of the Effective Date.

 

	
   

  	
  ASSIGNOR:

  
	
   

  	
   

  	
   

  
	
   

  	
  BACCARAT SILICON INC.,

  
	
   

  	
  a California corporation

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Its:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  ASSIGNEE:

  
	
   

  	
   

  	
   

  
	
   

  	
  DAN CAPUTO CO., a

  
	
   

  	
  California corporation

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Its:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Its:

  	
   

  

 

 

2

 

 

EXHIBIT A

 

DESCRIPTION
OF PROPERTY

 

Lot 5, as shown on the map entitled, “Tract
No. 922, Unit No. 1 Salinas Airport Business Center, filed for record May 6,
1981 in Volume 14 of “Cities and Towns,” at page 57, Monterey County Records.

 

Assessors Parcel No. 003 863 007

 

 

 

 

3

 

 

EXHIBIT
“G”

 

OPTION AGREEMENT

 

This Option Agreement
(“Agreement”) is entered into as of this
           day of August,
2003 (the “Effective Date”), by and between INTEGRATED DEVICE TECHNOLOGY, INC.,
a Delaware corporation (“Optionor”) and DAN CAPUTO CO., a California
(“Optionee”).

 

Recitals

 

A.            Optionor is the owner of that certain unimproved real
property located in the City of Salinas, County of Monterey, State of
California, more particularly described in Exhibit A attached hereto and made a
part hereof (the “Property”).

 

B.            Optionor desires to grant to Optionee and Optionee
desires to receive from Optionor an option to purchase the Property subject to
the terms and conditions set forth below. 
Upon timely exercise of such option to purchase the Property as
described below, the parties intend to effect the purchase and sale of the
Property as set forth herein.

 

NOW, THEREFORE, for and in
consideration of the mutual covenants herein contained, each of the parties
hereto agree as follows:

3.             Option.

 

(a)           Grant of Option. 
Optionor hereby grants to Optionee the exclusive right to purchase the
Property at the price and under the terms and conditions set forth herein (the
“Option”).

 

(b)           Option Payment. 
Concurrently with the execution of this Agreement, Optionee shall
deliver to Escrow Holder (as defined in Section 5(b) below), together with a
fully executed copy of this Agreement, the sum of Ten Thousand Dollars
($10,000.00) (the “Option Payment”) by wire transfer or a bank cashier’s
check,, as consideration for the grant of the Option. Upon receipt of the
Option Payment, Escrow Holder shall immediately release the Option Payment to
Optionor.

 

(c)           Option Term. 
The term of the Option (“Option Term”) shall commence on the Effective
Date and expire on the date that is thirty (30) days after the Effective
Date.  Optionee shall have the right to
extend the Option Term for five (5) periods of thirty (30) days each (each such
period, an “Option Term Extension”). 
Optionee may extend the Option Term for an Option Term Extension by
giving written notice to Optionor and Escrow Holder not later than two (2)
business days prior to the expiration of the Option Term or then current Option
Term Extension, and concurrently delivering into Escrow by wire transfer or a
bank cashier’s check the amount of Ten Thousand Dollars ($10,000) (“Option
Extension Payment”).  Upon receipt of an
Option Extension Payment, Escrow Holder shall immediately release such payment
to Optionor.  If Optionee fails to give
written notice of an Option Term Extension and/or fails to concurrently deliver
the Option Extension Payment into Escrow, the Option Term shall expire upon the
expiration of the Option Term or then-current Option Term Extension.  If the Option

 

 

4

 

 

Term or any Option Term Extension shall
expire on a Saturday, Sunday or legal holiday, then such expiration shall be
extended to the next following business day.

 

(d)           Exercise of Option.  The Option shall be exercised by Optionee by written notice
delivered to Optionor prior to the expiration of the Option Term or Option Term
Extension, at the address set forth in Section 16(a) hereof or such other
address as may be designated in writing by Optionor (“Exercise Notice”) and by
delivery by Optionee to Escrow Holder concurrently therewith, by wire transfer
or a bank cashier’s check, the amount of One Hundred Thousand Dollars
($100,000.00) (“Exercise Deposit”). 
Upon receipt, Escrow Holder shall place the Exercise Deposit in an
interest-bearing account with all interest accruing to Optionee.  The date upon which the Exercise Notice is
delivered to Optionor shall be referred to in this Agreement as the “Exercise
Date.”  Time is of the essence as to the
exercise of the Option.

 

(e)           Automatic Termination; Release of Option.  If Optionee (i) fails to exercise the Option
in strict accordance with the provisions hereof prior to the expiration of the
Option Term or any Option Term Extension, (ii) fails to close escrow on the
Property through no fault of Optionor following the timely exercise of the
Option in accordance with the provisions hereof, (iii) fails to deliver written
notice of an Option Term Extension and/or to concurrently deliver the Option
Extension Payment on or before the time required hereunder, (iv) fails to
deliver the Exercise Deposit to Escrow Holder on or before the date that such
amount is due, or (v) is in breach or default of any of its obligations under
this Agreement after any applicable notice and cure period, then (x) this
Agreement and the rights of Optionee hereunder shall automatically and
immediately terminate without notice, (y) each party shall be discharged of its
obligations hereunder (except that Optionee’s indemnity obligations set forth
in Sections 6(e) and 14 hereof shall survive the termination of this Agreement),
and (z) Optionor shall be entitled to retain the Option Payment, any Option
Extension Payments and the Exercise Deposit (if applicable).  Upon termination of this Option as described
in this Section 1(e), Optionee agrees that it shall, within three (3) days
following written demand by Optionor, execute, acknowledge (in recordable form)
and deliver to Optionor a release of option or such other document as may be
reasonably required by Optionor to verify the termination of this Agreement.

 

(f)            Nonrefundability of Option Payment; Application to
Purchase Price. The Option Payment and each Option Extension Payment shall
be non-refundable to Optionee (unless Escrow fails to close due to Optionor’s
material default and Optionee makes the election set forth in Section 15(b)(i)
below) and shall be applicable to the Purchase Price (as defined in Section 3)
of the Property at the Close of Escrow. 
The parties acknowledge and agree that the nonrefundable nature of the Option
Payment and any Option Extension Payment is a bargained for term and condition
of this Agreement, and is fair compensation to Optionor for the Option granted
herein.

 

4.             Purchase and Sale of Property.  If Optionee exercises the Option within the
Option Term or any Option Term Extension in accordance with Section 1(d),
Optionor shall sell the Property to Optionee, and Optionee shall purchase the
Property from Optionor, upon the terms and conditions hereinafter set forth.
The Property shall include (i) said real property and (ii) all rights, privileges,
and easements appurtenant to the Property, including, without limitation, all
development rights, air rights, water, water rights, riparian rights and water
stock

 

 

5

 

 

relating to the Property, any rights of way
or other appurtenances reflected in the public record and used in connection
with the beneficial use and enjoyment of the Property, and all of Optionor’s
right, title, and interest in and to all public roads and alleys adjoining or
servicing the Property.

 

5.             Purchase Price. 
Optionee shall pay One Million Six Hundred Eleven Thousand Seven Hundred
Fourteen Dollars ($1,611,714) for the Property (“Purchase Price”).

 

6.             Payment of Purchase Price.  The Purchase Price for the Property shall be
evidenced by and paid to Optionor as follows:

 

(a)           Application of Deposits.  The Option Payment, any Option Extension Payment and the Exercise
Deposit and all interest accrued thereon shall be applied to the Purchase Price
at the Close of Escrow.  The Exercise
Deposit shall be nonrefundable, except as provided in Section 15(b) below.  If after exercise of the Option, Optionee
fails to complete the purchase of the Property in accordance with this
Agreement, then Optionor shall be entitled to retain the Exercise Deposit and
all interest accrued thereon as liquidated damages pursuant to Section 14
hereof.

 

(b)           Purchase Price Balance.  On or before the Closing Date (as defined in Section 4(b) below),
Optionee shall deposit with Escrow Holder cash in the amount of the Purchase
Price, less the sum of the Option Payment, any Option Extension Payments and
the Exercise Deposit.

 

7.             Escrow.

 

(a)           Escrow Holder. 
Concurrently with the execution of this Agreement, the parties shall
open an escrow (“Escrow”) with First American Title Company, whose address is
1737 North First Street, Suite 100, San Jose, California 95112, Attention: Dian
Blair (408) 451-7800 (“Escrow Holder” or “Title Company”, as applicable) for
purposes of consummating the transaction contemplated by this Agreement.  Concurrently with the opening of Escrow, the
parties shall deliver to Escrow Holder a copy of this Agreement and
instructions for the disposition of the Option Payment, any Option Extension
Payments and the Exercise Deposit in accordance with the terms of this
Agreement.  At least twenty-four (24)
hours prior to the Close of Escrow, Optionor and Optionee shall each deliver to
Escrow Holder written closing instructions and all executed documents, payments
and funds necessary to complete the same in accordance with the terms hereof.

 

(b)           Close of Escrow. 
The Close of Escrow for the purchase and sale of the Property shall
occur on the first business day that is fifteen (15) calendar days after the
date of Optionee’s exercise of the Option. 
For purposes of this Agreement, the “Close of Escrow” or the “Closing
Date” shall mean the date that the Grant Deed (as defined in Section 11(a)(i))
is recorded by Escrow Holder in the Official Records of Monterey County,
California.

 

 

6

 

 

8.             Title.

 

(a)           Title Report. 
Within seven (7) business days after the Effective Date, Optionor shall
cause Escrow Holder to provide Optionee with a current preliminary title report
for the Property (the “Title Report”) issued by Escrow Holder, together with
copies of all related underlying documents.  Optionee
shall acquire and accept title to the Property subject to any and all defects,
liens, encumbrances and matters affecting the Property whether or not reflected
in the public records (and whether or not apparent from an inspection of the
land); all exceptions to title shown on the Title Report (including all
preprinted exceptions) or that would be shown on any updated title report dated
as of the Exercise Date; the lien of real property taxes and assessments not
yet due and payable and supplemental taxes, if any; that certain Declaration of
Covenants, Conditions and Restrictions executed by CC&F Salinas Properties,
Inc. and Salinas Associates and recorded on September 21, 1982 on Reel 1579,
page 142 in the Official Records of Monterey County, California (“CC&R’s”);
any title exceptions arising or resulting from, or caused by Optionee in
connection with, its inspection, use or contemplated improvement and
development of the Property; and any and all matters which may be disclosed by
any survey of the Property (collectively, the “Permitted Exceptions”).  Notwithstanding the foregoing, Optionor
shall be obligated to remove any delinquent taxes or assessments, mechanics’
liens or monetary encumbrances placed by Optionor on the Property prior to the
Close of Escrow.

 

(b)           Title Insurance. 
Optionor shall pay the premium for a standard coverage CLTA owner’s
policy of title insurance to be issued by Escrow Holder to Optionee with a
liability limit equal to the Purchase Price, showing title to the Property
vested in Optionee subject to the Permitted Exceptions (the “Owner’s Title
Policy”).  In the event Optionee desires
to obtain a standard coverage ALTA owner’s policy of title insurance, Optionee
shall be responsible, at Optionee’s sole cost and expense, for obtaining an
ALTA Survey of the Property, and the payment of the ALTA portion of the title
policy premium.  Optionee shall pay, at
Optionee’s sole cost and expense, the cost of any endorsements required by
Optionee.  In no event shall the Close
of Escrow be extended in order to permit Optionee to obtain a survey of the
Property.  Optionee shall arrange with
the Title Company for the issuance of a title insurance policy in form and
content and with endorsements required by Optionee prior to exercise of the
Option.

 

(c)           Further Encumbrance.  After Optionee’s exercise of the Option and prior to the Close of
Escrow, Optionor shall not voluntarily create any additional title exceptions
or further encumber the Property, for a period beyond the Close of Escrow,
except with Optionee’s prior written consent, which may be given or withheld in
Optionee’s sole and absolute discretion. 
If between the Exercise Date and the Close of Escrow, any additional
exception to title appears as shown in a supplemental title report issued by
the Title Company that is not approved by Optionee, or was caused by Optionee
or Optionee’s activities on the Property (in which case any such additional
title exception shall be deemed a Permitted Exception), Optionee shall give
prompt written notice of such new title exception to Optionor.  Optionor shall be obligated to remove from
title (or to cause to be insured over to Optionee’s reasonable satisfaction)
any such additional title exceptions that are voluntarily created by Optionor
between the Exercise Date and the Close of Escrow.  With respect to any such additional title exceptions that were
not voluntarily created by Optionor, Optionee shall have the right to either
(i) terminate this Agreement by giving written notice to Optionor and Escrow
Holder and obtain the refund of the Exercise Deposit, or (ii) proceed with the
Close of Escrow and acquire the Property subject to

 

 

7

 

 

such additional title exception(s).  If necessary to remove such additional title
exception(s), Optionor may extend the Close of Escrow for a period of not more
than thirty (30) days.

 

9.             Due Diligence Documents; Right of Entry.

 

(a)           Due Diligence Documents.  Optionor shall make available to Optionee for review during the
Option Term and any Option Extension Period, the following documents to the
extent any such items exist and are in the possession of Optionor or its
consultants (collectively, “Due Diligence Documents”):

 

(i)            copies of all Phase I and Phase II reports and any other
environmental reports including all correspondence with the Monterey County
Environmental Health Department;

 

(ii)           copies of all contracts relating to the management of the
Property;

 

(iii)          copies of property tax bills for the past three (3) years;

 

(iv)          copies of statements of operating expenses for the Property
for 2000, 2001 and 2002 including operating expense history;

 

(v)           copies of all leases, subleases and rental agreements that
will remain in effect after the Close of Escrow pertaining to the Property,
together with any amendments or addenda, if any;

 

(vi)          copies of all soils, environmental and engineering reports
pertaining to the Property;

 

(vii)         all materials provided to Optionor by the previous owner at
the time Optionor purchased the Property; and

 

(viii)        copies of any existing ALTA surveys.

 

Optionor makes no
representation or warranty with respect to the accuracy or completeness of any
of the Due Diligence Documents made available to Optionee except that the same
are true and correct copies of the documents in Optionor’s possession.

 

(b)           Access to Due Diligence Documents.  The Due Diligence Documents shall be
available for review during the Option Term and any Option Term Extension by
appointment only during regular business hours on regular business days at
Optionor’s office at 2975 Stender Way, Santa Clara, California 95054.  Optionee may request an appointment to
review the Due Diligence Documents by contacting James L. Laufman, Esq.,
General Counsel of Optionor at (408) 492-8614. 
Optionee may request copies of the Due Diligence Documents during its
review thereof, and Optionor shall, within three (3) business days after receipt
of the request, provide the same to Optionee subject to Optionee’s
reimbursement of Optionor’s reasonable costs in providing such copies.  Except for copies made by Optionor, Optionee
shall not remove the Due Diligence Documents from their location.

 

 

8

 

 

(c)           Physical Inspection.  During the Option Term and any Option Term Extension, Optionee
and Optionee’s employees, agents, contractors and consultants (“Optionee’s
Parties”) shall have the right to enter the Property to perform such investigations
and inspections of the Property, including but not limited to soil,
engineering, geological, structural and visual tests and inspections
(collectively, “Physical Inspections”) of the Property as Optionee deems
reasonably necessary at Optionee’s sole cost and expense.  In conducting such Physical Inspections,
Optionee and Optionee’s Parties shall comply with all applicable laws,
statutes, ordinances, rules and regulations. 
Optionee shall provide not fewer than three (3) business days’ prior
written notice to Optionor at the address for notice set forth in Section 16(a)
below of any desired entry onto the Property by Optionee or Optionee’s Parties
to perform Physical Inspections, stating the date on which Optionee desires
such entry to occur, the name, address and telephone number of the Optionee’s
Party who will make the entry, and the nature and location on the Property of
the inspection to be performed.  Within
five (5) days after Optionee’s receipt thereof, Optionee shall provide Optionor
with copies of all reports, data or test results resulting from any Physical
Inspections.  All Physical Inspections
shall be subject to Section 7(e) hereof.

 

(d)           Environmental Investigations.  During the Option Term and any Option Term
Extension, Optionee and Optionee’s Agents may enter the Property to perform
such non-invasive environmental assessments of the Property (“Environmental
Investigation”) which Optionee elects to undertake at Optionee’s sole cost and
expense with respect to the Property; provided, however, in no event shall
Optionee perform any “Phase II Environmental Assessment” or any testing of soil
and/or groundwater of the Property (“Invasive Testing”) without Optionor’s
prior written consent and compliance with this Section 7(d) .  Prior to performing any Environmental
Investigation, Optionee shall submit to Optionor at the address for notice set
forth in Section 16(a) below, at least five (5) business days prior to the date
of Optionee’s proposed entry onto the Property for such Environmental Investigation,
the name of Optionee’s environmental consultant who will conduct the
investigation, evidence of the consultant’s level of expertise and experience,
and a description of the Environmental Investigation to be performed.  If Optionee proposes any Invasive Testing,
then in addition to the foregoing information, Optionee shall submit to
Optionor the location of any proposed borings for soil and/or groundwater
sampling, the sampling and analytical methods to be used, the chemical
parameters and other conditions to be tested, the health and safety plan to be
followed, and the measures to be taken to restore the affected areas to
pre-existing conditions following completion of the Invasive Testing.  Optionor shall give Optionee written notice
of approval or disapproval of Optionee’s Invasive Testing investigation plan
within five (5) business days after receipt of the foregoing information.  If Optionor reasonably objects to the
environmental consultant or objects to the Invasive Testing investigation plan
proposed by Optionee, Optionor shall give Optionee written notice of such
disapproval and the reasons therefor within said five (5) business day
period.  Thereafter, Optionor and
Optionee shall promptly meet and negotiate in good faith to remove Optionor’s
objections.  In the event that the
parties are unable to agree, Optionor’s objections shall stand and Optionee may
either terminate the Agreement, choose another environmental consultant or
elect to revise its Invasive Testing investigation plan so as to remove
Optionor’s objections.  Optionee shall,
at its sole cost and expense, obtain any and all permits and approvals required
from applicable governmental agencies prior to commencing any

 

 

9

 

 

Invasive Testing.  Optionee shall not install any monitoring wells.  If Optionee seeks to sample groundwater,
Optionee shall do so through hydropunch or other geoprobe sampling procedures.  Optionor’s representatives may be present at
all times during the activities of Optionee and/or Optionee’s Parties on the
Property.  Optionor shall have the
right, at Optionor’s expense to take split samples or verification samples from
any Invasive Testing conducted by Optionee. 
All Environmental Investigations shall be subject to Section 7(e)
hereof.

 

If any reports, studies,
tests, documents or information applicable to the environmental condition of
the Property arising out of an Environmental Investigation are required to be
disclosed to a federal, state or local agency or governmental body, then
Optionee agrees that Optionor shall be the party to furnish such documentation
to the applicable governmental agency having jurisdiction over the Property and
neither Optionee nor its agents, employees or environmental consultants shall furnish
such information to the applicable governmental agencies.  If there is a demand for such information
generated by an Environmental Investigation by a governmental agency or by
legal process issued by a court of competent jurisdiction and Optionee has received
actual notice of such demand, Optionee shall promptly provide notice of such
demand to Optionor and afford Optionor an opportunity to impose any objections
or defenses to such demand.  Optionee
agrees that copies of all reports, studies and other documents and information
generated or prepared by or for Optionee in connection with Optionee’s
Environmental Investigations of the Property shall be furnished to Optionor
within five (5) business days of Optionee’s receipt of same.

 

(e)           Insurance, Indemnity.  Optionee shall maintain and shall cause each Optionee’s Party
entering onto the Property to perform Physical Inspections and/or Environmental
Investigations to maintain a policy or policies of commercial general liability
insurance insuring against claims and liabilities arising directly from or
related to acts, omissions or investigations of Optionee and Optionee’s Parties
in, on, or about the Property.  Such
insurance shall have limits of not less than Two Million Dollars
($2,000,000.00) per occurrence, unless a lower limit is approved in writing by
Optionor, and shall (i) specifically name Optionor as an additional
insured, (ii) not be canceled or the coverage or liability limits reduced
without thirty (30) days prior written notice to Optionor, (iii) insure the
indemnity obligations of Optionee as set forth below, and (iv) provide coverage
which is primary to any coverage carried by Optionor and not in excess
thereto.  Optionee shall deliver
insurance certificates to Optionor prior to any entry onto the Property by
Optionee or any of Optionee’s Parties. 
Optionee shall indemnify, defend and hold Optionor harmless from and
against any and all claims, liabilities, costs and expenses, including
reasonable attorneys’ fees and other direct costs that Optionor may actually
incur as a result of Optionee’s activities on the Property, including breach of
the confidentiality provisions set forth below.  All entries onto the Property shall be arranged through Optionor.  Optionor shall have the right to accompany
Optionee and Optionee’s Parties in connection with any entry onto the Property.

 

(f)            Confidentiality. 
Optionee shall take reasonable precautions, and shall cause Optionee’s
Parties to take reasonable precautions, not to voluntarily disclose to others,
except to those acting within or on behalf of Optionee who have a business need
to be informed, any information, in whatever form, which is disclosed to or
generated by Optionee or Optionee’s Parties or provided by Optionor as a result
of Optionee’s access to and/or review of the Due

 

 

10

 

 

Diligence Documents, Optionee’s Physical
Inspections, Environmental Investigations and/or Invasive Testing.  Optionee agrees that the information
contained in the Due Diligence Documents or disclosed or generated by
Optionee’s Physical Inspections, Environmental Investigations and Invasive
Testing shall be confidential and shall be used for the limited purpose of
deciding whether or not Optionee is interested in purchasing the Property.  The foregoing confidentiality agreement
shall apply to both Optionee and Optionee’s Parties.  The foregoing confidentiality obligation shall not apply to (i)
any information in the public domain or which enters the public domain after
the date of this Agreement other than through Optionee’s failure to comply with
this Section 7(f), (ii) any information previously known to Optionee, or (iii)
any information Optionee is required by law to disclose.  In the event that Optionee receives a demand
for such information from a governmental agency or by legal process issued by a
court of competent jurisdiction, Optionee shall promptly provide notice of such
demand to Optionor and afford Optionor an opportunity to impose any objections
or defenses to such demand.  If the
Purchase Agreement terminates for any reason, Optionee shall deliver to
Optionor the originals and all copies of any and all Due Diligence Documents
previously delivered to Optionee by Optionor. 
In addition, Optionee shall promptly remove all information and any
reports, data, or test results from Optionee’s Physical Inspections,
Environmental Investigations and Invasive Testing from its files and shall
exercise best faith efforts to require such removal from those of its
employees, agents, attorneys and environmental consultants (subject to
Applicable Laws), and following consultation with and direction from Optionor,
either destroy such information or forward the same to Optionor.

 

10.           Optionee’s Conditions to Close of Escrow.  The Close of Escrow and Optionee’s
obligation to consummate the transaction contemplated by this Agreement are
subject to the satisfaction of the following conditions (or Optionee’s waiver
thereof) for Optionee’s benefit on or prior to the Close of Escrow:

 

(a)           Title Policy. 
The Title Company shall be committed to issue to Optionee the Owner’s
Title Policy insuring title vested in Optionee, subject only to the Permitted
Exceptions;

 

(b)           Delivery of Documents.  Optionor shall have deposited into Escrow for delivery to
Optionee at the Close of Escrow the documents described and required pursuant
to Section 11(a) of this Agreement; and

 

(c)           Optionor’s Obligations.  Optionor shall have timely performed all of its obligations
required by the terms of this Agreement to be performed by Optionor.

 

If any of Optionee’s Closing
Conditions have not been satisfied by the Closing Date, then Optionee shall
give Optionor and Escrow Holder written notice on or before the Closing Date
specifying the particular condition that has not been satisfied.  If Optionee delivers such notice, then
Optionor may postpone the Close of Escrow for a period up to ten (10) days
after the scheduled Closing Date in order to permit Optionor to take such
action as is necessary to cause the closing condition specified in Optionee’s
notice to be satisfied.  If the
condition specified in Optionee’s notice is not satisfied on the Closing Date,
as extended, then Optionee may terminate this Agreement by providing written notice
of such termination to Optionor and

 

 

11

 

 

Escrow Holder on or within fifteen (15) days
after the extended Closing Date.  If
Optionee so terminates this Agreement, Escrow Holder shall return the Deposit
and all interest accrued thereon to Optionee, and neither party shall have any
further obligation hereunder except for the indemnity obligations under
Sections 7(e) and 14 hereof.

 

11.           Representations and Warranties.

 

(a)           Optionor’s Representations and Warranties.  Optionor hereby makes the following
representations and warranties to Optionee as of the Effective Date and as of
the Close of Escrow.  The phrase “to
Optionor’s knowledge” as used in certain of the representations and warranties
shall mean the actual knowledge of James L. Laufman, Esq., General Counsel of
Integrated Device Technology, Inc., without any duty of investigation or
inquiry.

 

(i)            Authority. 
Optionor is duly and validly authorized to execute this Agreement and
perform all of its obligations hereunder. 
This Agreement is valid, binding and enforceable against Optionor.

 

(ii)           Existing Agreement.  Neither Optionor, nor to Optionor’s knowledge, the Property, is
subject to any contract, agreement or restriction which would prevent the
consummation of the transactions contemplated by this Agreement.

 

(iii)          Actions. 
Optionor has not received written notice of any action, suit or
proceeding affecting the Property, at law or in equity, pending before any
federal, state or municipal governmental department, commission, board, bureau,
agency or instrumentality.

 

(iv)          No Violations of Declaration.  To Optionor’s knowledge, Optionor has not
received written notice that the Property is in violation of any provision of
the CC&R’s.

 

Optionor shall not be liable
for breach of any of Optionor’s representations or warranties set forth in this
Section 9(a), Optionor shall not be in default under this Agreement nor shall
Optionee have the right to terminate this Agreement due to the incorrectness of
any of the representations and warranties set forth in this Section 9(a) if,
prior to the Close of Escrow, either (A) as to matters which are made to
Optionor’s knowledge, Optionor obtains information not known to James Laufman,
Esq. on the Effective Date that would make any of such representations and warranties
incorrect and Optionor promptly discloses such information to Optionee, or (B)
after the Effective Date, Optionor receives a notice of the type specified in
Sections 9(a)(iii) or (iv), and Optionor promptly provides Optionee with a copy
of such notice and provides Optionee with a copy thereof.  If Optionee receives any information not
otherwise disclosed by Optionor pursuant to the foregoing sentence on or before
the Close of Escrow that would make any of Optionor’s representations or
warranties in this Section 9(a) untrue or incorrect as of the Close of Escrow,
then Optionee shall promptly disclose such information to Optionor and
Optionee’s sole remedy shall be to either (i) terminate this Agreement by
giving written notice of such termination to Optionor and Escrow Holder, in
which case this Agreement shall terminate, and Optionee shall be entitled to
the return of the Exercise Deposit, or (ii) to proceed with the Close of Escrow
despite such information, in which case Optionee shall be deemed to have waived
any claim against Optionor resulting from the inaccuracy or incorrectness

 

 

12

 

 

of Optionor’s representations and warranties
as of the Close of Escrow based on such information.  The representations and warranties of Optionor contained in this
Section 9(a) shall survive the Close of Escrow for a period of six (6)
months.  If Optionee has not filed an
action for breach of such representations or warranties within six (6) months
of the Close of Escrow, Optionee shall thereafter be precluded from ever making
a claim or instituting any legal action, suit or proceeding against Optionor in
connection with such representations and warranties.

 

(b)           Optionee’s Representations.  Optionee represents and warrants to Optionor
that Optionee is a corporation, duly organized, validly existing and in good
standing in the State of California, and has the capacity and full power and
authority to enter into and carry out the agreements contained in, and the
transactions contemplated by, this Agreement, and this Agreement has been duly
authorized and executed by Optionee, and upon delivery to and execution by
Optionor, shall be a valid and binding agreement of Optionee.

 

(c)           Optionor’s Covenants.  From the Exercise Date until the earlier of the Close of Escrow
or the termination of this Agreement, Optionor covenants to Optionee as
follows:

 

(i)            Optionor shall maintain the Property in the same
condition and manner as existed on the Exercise Date, damage by casualty and reasonable
wear and tear excepted.

 

(ii)           Optionor shall pay all bills and invoices for labor,
material and services supplied to the Property prior to the Close of Escrow,
except to the extent arising from Optionee’s activities on the Property.

 

(iii)          Optionor shall maintain in full force any insurance
coverage pertaining to the Property, either through the existing insurance
policies or replacement policies.

 

(iv)          Optionor shall not enter into any new contracts or
agreements, or modify any existing contracts or agreements relating to the
Property for a term beyond the Close of Escrow without the prior written
consent of Optionee, which Optionee may withhold in its sole and absolute
discretion.

 

12.           As Is Acquisition. 
Optionee acknowledges that Optionee owns certain real property in the
vicinity of the Property.  Optionee
hereby agrees and warrants that it has (i) inspected and is familiar with the
Property and the surrounding areas and the suitability of the Property for
Optionee’s purposes.  Optionee represents
and warrants that Optionee has satisfied itself, or prior to the Close of
Escrow will satisfy itself, as to the physical, environmental, legal and
economic condition of the Property and its suitability for the purposes
intended by Optionee.  Optionee acknowledges
and agrees that Optionee is acquiring the Property subject to all existing
laws, ordinances, rules and regulations, and that, except as expressly set
forth in Section 9(a), neither Optionor nor any of Optionor’s officers,
directors, employees, agents, representatives and/or attorneys (collectively,
“Optionor’s Agents”) have made any warranties, representations or statements
regarding the availability of any approvals, or the laws, ordinances, rules or
regulations of any governmental or quasi-governmental body, entity, district or
agency having

 

 

13

 

 

authority with respect to the ownership,
possession, development, occupancy, condition and/or use of the Property.  Except as expressly set forth in Section
9(a), Optionor disclaims the making of any representations or warranties,
express or implied, regarding the Property, or matters affecting the Property,
including, without limitation, the physical condition of the Property, title to
or boundaries of the Property, soil condition, the presence of hazardous waste,
hazardous materials, toxic waste or other environmental matters, compliance of
the Property with building, health, safety, land use and zoning laws,
regulations and orders, engineering characteristics, traffic patterns and all
other information pertaining to the Property. 
Optionee further acknowledges that Optionor has made no representation
or warranty regarding the accuracy or completeness of any reports or studies
relating to the Property which may have been delivered or made available to
Optionee other than that the same are true and correct copies of the reports
and studies available to Optionor. 
Optionee moreover acknowledges that (i) Optionee is a sophisticated
investor, knowledgeable and experienced in the financial and business risks
attendant to an investment in real property and capable of evaluating the
merits and risks of entering into this Agreement and purchasing the Property,
(ii) that Optionee has entered into this Agreement with the intention of making
and relying upon its own or its experts investigation of the physical,
environmental, economic and legal condition of the Property, including, without
limitation, the compliance of the Property with laws and governmental regulations
and the operation of the Property and/or whether the Property is located in an
area which is designated as a special flood hazard area, dam failure inundation
area, earthquake fault zone, seismic hazard zone, high fire severity area or
wildland fire area, by any federal, state or local agency, and (iii) that
Optionee is not, except as to any representations or warranties expressly set
forth in Section 9(a), relying on any representations and warranties made by
Optionor or anyone acting or claiming to act on Optionor’s behalf concerning
the Property.  Optionee hereby
undertakes and assumes the risks associated with all matters pertaining to the
Property’s location in any area designated as a special flood hazard area, dam
failure inundation area, earthquake fault zone, seismic hazard zone, high fire
severity area or wildland fire area, by any federal, state or local
agency.  Optionee hereby acknowledges
that it has not received from Optionor any accounting, tax, legal,
architectural, engineering, property management or other advice with respect to
this transaction and is relying upon the advice of its own accounting, tax,
legal, architectural, engineering, property management and other advisors.  Optionee shall purchase the Property in its
“As Is” condition on the Closing Date and assumes the risk that adverse
physical, environmental, economic or legal conditions may not have been
revealed by its investigations. 
Optionor shall have no liability for any subsequently discovered
defects, whether latent or patent.

 

Except with respect to the
representations and warranties set forth in Section 9(a), Optionee agrees that,
from and after the Close of Escrow, Optionee, for itself and its agents,
affiliates, successors and assigns, shall release and forever discharge
Optionor, its agents, affiliates, successors and assigns from, and waives any
right to proceed against Optionor for, any and all rights, claims and demands
at law or in equity relating to the physical, environmental, economic or legal
condition of the Property.

 

Such release shall survive
the Close of Escrow.  Optionee has read
and has been fully advised of the contents of Section 1542 of the Civil
Code of the State of California, which reads as follows:

 

 

14

 

 

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

 

and, Optionee hereby expressly waives any and
all rights and the benefits of said section or any similar section of the laws
of any other applicable jurisdiction. 
Notwithstanding the foregoing, the waivers and release set forth above
are not intended to, and shall not, release or discharge liability for (i)
claims relating to indemnification under Section 14 below, (ii) any claims
regarding post-closing prorations pursuant to Section 11(d) below, and (iii)
claims arising from Optionor’s intentional misrepresentation.

 

13.           Deposits Into Escrow.

 

(a)           Optionor’s Deposits Into Escrow.  Optionor shall deposit or cause to be
deposited into Escrow prior to the Close of Escrow the following:

 

(i)            An executed and acknowledged Grant Deed in the form
attached hereto as Exhibit ”B” (the “Grant Deed”);

 

(ii)           An executed Federal Non-Foreign Investor Affidavit in the
form attached hereto as Exhibit ”C” (the “FIRPTA Affidavit”);

 

(iii)          An executed Withholding Exemption Certificate (California
Form 593 W) as required under the California Revenue and Taxation Code;

 

(iv)          Two counterpart originals of an Assignment and Assumption
of Declaration of Covenants, Conditions and Restrictions in the form attached
hereto as Exhibit “D” (“CC&R Assignment”); and

 

(v)           Such other documents as may be reasonably required to
consummate this transaction.

 

(b)           Optionee’s Deposits Into Escrow.  Optionee shall deposit into Escrow prior to
the Close of Escrow the following:

 

(i)            The Purchase Price;

 

(ii)           Two counterpart originals of the CC&R Assignment;

 

(iii)          Such additional funds as may be required to pay Optionee’s
share of closing costs as provided herein; and

 

(iv)          Such other documents as may be reasonably required to
consummate this transaction.

 

 

15

 

 

(c)           Expenses of Escrow.  Optionor shall pay (i) the CLTA premium for the Owner’s
Title Policy, (ii) all county documentary transfer taxes and (iii) one-half of
the escrow fees.  Optionee shall pay (i)
the ALTA portion of the premium for the Owner’s Title Policy, if Optionee
elects ALTA coverage, (ii) the cost of an ALTA survey, if Optionee elects to
obtain the same; (iii) the cost of any title endorsements Optionee elects to
obtain, and (iv) one-half of the escrow fees. 
All other reasonable and customary expenses, fees and costs incurred in
connection with the consummation of the Escrow, including, without limitation,
document preparation charges and recording fees, shall be borne by the parties
hereto in accordance with the custom and practice in Monterey County, California,
or in the absence of custom, equally between the parties.  Optionor and Optionee shall each bear their
own respective attorneys’ fees and accounting costs incurred in connection with
this transaction.

 

(d)           Prorations. 
All real property taxes and assessments shall be prorated between
Optionee and Optionor as of the Close of Escrow with appropriate debits and
credits to the accounts of Optionee and Optionor so that, as between Optionee
and Optionor, Optionor shall pay all of the taxes and assessments to the extent
allocable to the period ending on the date immediately prior to the Close of
Escrow and Optionee shall pay all of the taxes and assessments to the extent
duly allocable to the period commencing upon the Close of Escrow.  If the amount of the current tax payment is
not available, such proration shall be made on the basis of the most recent tax
information available at the Close of Escrow and the parties shall make
appropriate corrections promptly when accurate information becomes available.  Any corrected adjustment or prorations shall
be paid in cash to the party entitled thereto.

 

14.           Transfers and Assignments.  Optionee shall have the right to assign this
Agreement to a corporation, joint venture, partnership, limited liability
company or other similar entity, provided that Optionee and/or its principals
(including trusts of which the principals are trustors or settlors) has or have
at least a fifty percent (50%) interest in said entity.  Any assignment permitted under this section
shall not release Optionee of its obligations hereunder, and the assignee or
nominee under this Agreement shall assume all obligations of Optionee and agree
to execute all documents and to perform all obligations imposed on Optionee as
if the assignee or nominee was the original buyer under this Agreement.  Except as expressly set forth above,
Optionee shall not transfer or assign this Agreement or any of Optionee’s
rights or obligations hereunder without the prior written consent of Optionor,
which Optionor may withhold in its sole and absolute discretion.  Any such transfer or assignment made without
Optionor’s prior written consent, if required hereunder, shall be void and of
no force and effect.  Subject to the
foregoing, this Agreement shall be binding upon and inure to the benefit of the
successors and assigns of the parties.

 

15.           Merger.

 

(a)           Title.  All
obligations, representations and warranties, express or implied, of Optionor in
connection with the state of title to the Property shall merge in the Grant Deed
delivered to Optionee at the Close of Escrow. 
Upon acceptance of title to the Property, Optionee expressly waives any
right of rescission and all claims for damages by reason of any obligation,
representation, warranty, promise or agreement pertaining to the state of title
to the Property.  By accepting title to
the Property, Optionee agrees to rely upon its policy of title insurance and
shall

 

 

16

 

 

look solely to the title insurer of the
Property in the event of any claims concerning defects in or other matters
affecting title to the Property, which are covered by such policy.

 

(b)           Merger of Obligations.  Unless expressly provided otherwise in this Agreement, all
obligations of Optionor under this Agreement shall merge in and shall not
survive delivery of the Grant Deed to Optionee.

 

16.           Broker’s Commission.  The parties acknowledge that Colliers International (“Optionor’s
Broker”) exclusively represents Optionor and BT Commercial (“Optionee’s
Broker”) exclusively represents Optionee in this transaction.  Upon the Close of Escrow, Optionor shall pay
a real estate brokerage commission to Optionor’s Broker in connection with this
transaction pursuant to a separate agreement and Optionee shall pay a real
estate brokerage commission to Optionee’s Broker pursuant to a separate
agreement.  Except with respect to
Optionor’s Broker and Optionee’s Broker, each party represents and warrants to
the other party that it has not dealt with, nor does such representing party
have any knowledge of, any persons, firms or entities which would be entitled
to a broker’s commission, finder’s fee or the like in connection with the
transactions contemplated by this Agreement. 
In the event any warranty or representation made by a party in this
Section 14 proves to be false, such party shall indemnify, defend and hold
the other party harmless with respect to any claims, losses, costs, liabilities
and other expenses (including attorneys’ fees) which the other party may incur
as a result of such breach or misrepresentation.  The foregoing obligation shall survive the Close of Escrow.

 

17.           Remedies.

 

(a)           Liquidated Damages.  OPTIONEE RECOGNIZES THAT THE PROPERTY WILL BE REMOVED FROM THE
MARKET DURING THE EXISTENCE OF THIS AGREEMENT. 
OPTIONEE ACKNOWLEDGES THAT IF IT DEFAULTS IN ITS PERFORMANCE HEREUNDER
AFTER EXERCISING THE OPTION AND PRIOR TO OR AT THE CLOSE OF ESCROW, OPTIONOR
SHALL BE ENTITLED TO COMPENSATION FOR THE DETRIMENT RESULTING FROM THE REMOVAL
OF THE PROPERTY FROM THE MARKET.  THE
PARTIES HERETO AGREE THAT THE DAMAGES THAT OPTIONOR SHALL SUSTAIN AS A RESULT
OF SUCH BREACH WILL BE EXTREMELY DIFFICULT AND IMPRACTICABLE TO ASCERTAIN.  THEREFORE, THE PARTIES AGREE THAT IF THE
CLOSE OF ESCROW FAILS TO OCCUR AS A RESULT OF A BREACH BY OPTIONEE OF ITS
OBLIGATIONS HEREUNDER, OPTIONOR SHALL BE ENTITLED TO RETAIN OR RECOVER THE SUM
OF THE OPTION PAYMENT, ANY OPTION EXTENSION PAYMENTS AND THE EXERCISE DEPOSIT
AND ALL INTEREST ACCRUED THEREON AS ITS EXCLUSIVE REMEDY AGAINST OPTIONEE, AT LAW
OR IN EQUITY, FOR BREACH OF OPTIONEE’S COVENANT TO PURCHASE THE PROPERTY (BUT
NOT FOR BREACH OF THE MATTERS SET FORTH IN THE FOLLOWING SENTENCE), AND SAID
SUM SHALL BE PAID AND RECEIVED AS LIQUIDATED DAMAGES AND NOT AS A PENALTY.  EXCEPT WITH RESPECT TO OPTIONEE’S BREACH OF
ANY INDEMNITY OBLIGATION OR ANY OTHER OBLIGATION OF OPTIONEE HEREUNDER (OTHER
THAN THE COVENANT TO PURCHASE THE PROPERTY) WHICH SURVIVES THE CLOSE OF ESCROW
(WHICH BREACH SHALL ENTITLE OPTIONOR TO SEEK ANY AND ALL REMEDIES

 

 

17

 

 

AVAILABLE AT LAW AND IN EQUITY AND FOR WHICH
BREACH THIS SECTION 15 SHALL NOT APPLY), BOTH PARTIES ACKNOWLEDGE AND
AGREE THAT SAID AMOUNT IS PRESENTLY A REASONABLE ESTIMATE OF OPTIONOR’S DAMAGES
IN THE EVENT OF OPTIONEE’S BREACH OF ITS OBLIGATION TO PURCHASE THE PROPERTY
CONSIDERING ALL OF THE CIRCUMSTANCES EXISTING ON THE DATE OF THIS AGREEMENT,
INCLUDING THE RELATIONSHIP OF THE SUM TO THE RANGE OF HARM TO OPTIONOR THAT
REASONABLY COULD BE ANTICIPATED AND THE ANTICIPATION THAT PROOF OF ACTUAL
DAMAGES WOULD BE IMPRACTICAL OR EXTREMELY DIFFICULT.  BY INITIALING THIS SECTION BELOW, THE PARTIES HERETO SIGNIFY
THEIR APPROVAL AND CONSENT TO THE TERMS OF THIS SECTION.

 

	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Optionor’s Initials

  	
   

  	
  Optionee’s Initials

  	
   

  

 

(b)           Optionee’s Remedies.  If the Close of Escrow does not occur because of an uncured
material default by Optionor under this Agreement at the Close of Escrow,
Optionee’s sole and exclusive remedies shall be to either (i) terminate this Agreement
by delivery of notice of termination to Optionor, whereupon Optionor shall
cause Escrow Holder to return to Optionee the Option Payment, any applicable
Option Extension Payment, and the  Exercise Deposit and all interest accrued
thereon or (ii) continue this Agreement pending Optionee’s action for specific
performance.

 

18.           General Provisions.

 

(a)           Notices. 
Any notice, request, demand, consent, approval or other communication
required or permitted hereunder or by law shall be in writing and shall be
deemed duly given (i) when personally delivered, (ii) sent by overnight courier
providing evidence of receipt of delivery, or (iii) by United States mail,
registered or certified mail, postage prepaid, return receipt requested, to the
addresses set forth below or to such other address of which the parties are
subsequently notified in writing:

 

	
   

  	
  Optionor:

  	
  INTEGRATED DEVICE
  TECHNOLOGY, INC.

  
	
   

  	
   

  	
  2975 Stender Way

  
	
   

  	
   

  	
  Santa Clara, California
  95054

  
	
   

  	
   

  	
  Attn:

  	
  James L. Laufman, Esq.

  
	
   

  	
   

  	
   

  	
  General Counsel

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  With a copy to:

  	
  Berliner Cohen

  
	
   

  	
   

  	
  10 Almaden Boulevard,
  Eleventh Floor

  
	
   

  	
   

  	
  San Jose, California 95113

  
	
   

  	
   

  	
  Attn:

  	
  Steven J. Casad, Esq.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Optionee:

  	
  Dan Caputo Co.

  
	
   

  	
   

  	
  1530-A Parkmoor Avenue

  
	
   

  	
   

  	
  San Jose, CA 95128-2406

  
	
   

  	
   

  	
  Attn:

  	
  Mr. Phil Rolla

  

 

 

18

 

 

	
   

  	
  With a copy to:

  	
  Hefner, Stark and Marois,
  LLP

  
	
   

  	
   

  	
  2150 River Plaza Drive,
  Suite 450

  
	
   

  	
   

  	
  Sacramento, CA 95833

  
	
   

  	
   

  	
  Attn:

  	
  Joel S. Levy, Esq.

  

 

Notices shall be deemed delivered upon
receipt.  Any party may change its
address for notice by giving written notice of such change to the other party.

 

(b)           Legal Fees. 
In the event either party brings an action or suit against the other
party by reason of any breach of any of the covenants or agreements on the part
of the other party arising out of this Agreement, then, in that event, the
prevailing party in such action or dispute, whether by final judgment or out of
court settlement, shall be entitled to have and recover of and from the other
party all reasonable costs and expenses of suit, including reasonable
attorneys’ fees.

 

(c)           Waiver of Jury Trial.  Optionee and Optionor each acknowledge and agree that any
controversy which may arise under this Agreement would be based upon difficult
and complex issues, and therefore, Optionee and Optionor each hereby waive any
right to a trial by jury in any action or proceeding to enforce or defend any
rights under this Agreement and agree that any such action or proceeding shall
be tried in a court of competent jurisdiction by a judge and not by a jury.

 

(d)           Survival of Indemnities.  Optionee’s indemnity obligation under Sections 7(e) and 14 of
this Agreement shall survive the recordation of the Grant Deed at the Close of
Escrow.  Optionor’s indemnity obligations
under Section 14 hereof shall survive the recordation of the Grant Deed at the
Close of Escrow.

 

(e)           Required Actions of Optionee and Optionor.  Optionee and Optionor agree to execute such
instruments and documents and to diligently undertake such actions as may be
reasonably required in order to consummate the purchase and sale herein
contemplated and shall use their diligent efforts to accomplish the Close of
Escrow in accordance with the provisions hereof.

 

(f)            Time of Essence. 
Time is of the essence of each and every term, condition, obligation,
and provision hereof.

 

(g)           Counterparts. 
This Agreement may be executed in multiple counterparts, each of which
shall be deemed an original but all of which, together, shall constitute one
and the same instrument.

 

(h)           Captions. 
Any captions to, or headings of, the paragraphs or subparagraphs of this
Agreement are solely for the convenience of the parties hereto, are not a part
of this Agreement, and shall not be used for the interpretation or
determination of the validity of this Agreement or any provision hereof.

 

 

19

 

 

(i)            No Obligations to Third Parties.  Except as otherwise expressly provided
herein, the execution and delivery of this Agreement shall not be deemed to
confer any rights upon, nor obligate any of the parties hereto, to any person
or entity other than the parties hereto.

 

(j)            Exhibits. 
The Exhibits attached hereto are hereby incorporated herein by this
reference.

 

(k)           Amendment to this Agreement.  The terms of this Agreement may not be
modified or amended except by an instrument in writing executed by each of the
parties hereto.

 

(l)            Waiver. 
The waiver or failure to enforce any provision of this Agreement shall
not operate as a waiver of any future breach of any such provision or any other
provision hereto.

 

(m)          Applicable Law. 
This Agreement shall be governed by and construed in accordance with the
laws of the State of California.

 

(n)           Fees and Other Expenses.  Except as otherwise provided herein, each of the parties shall
pay its own fees and expenses in connection with this Agreement.

 

(o)           Severability. 
If any provision of this Agreement is, or hereinafter is adjudged to be,
for any reason void, unenforceable, or invalid, it is the specific intent of
the parties that the remainder hereof shall be and remain in full force and
effect.

 

(p)           Entire Agreement. 
This Agreement supersedes any prior agreement, oral or written, and
contains the entire agreement between Optionee and Optionor as to the subject
matter hereof.  No subsequent agreement,
representation, or promise made by either party hereto, or by or to an
employee, officer, agent, or representative of either party shall be of any
effect unless it is in writing and executed by the party to be bound thereby.

 

IN WITNESS WHEREOF, Optionee
and Optionor have executed this Agreement as of the day and year first above
written.

 

	
   

  	
  “OPTIONOR”

  
	
   

  	
   

  	
   

  
	
   

  	
  INTEGRATED DEVICE
  TECHNOLOGY, INC.,

  
	
   

  	
  a Delaware corporation

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Its:

  	
   

  
				

 

 

20

 

 

	
   

  	
  “OPTIONEE”

  
	
   

  	
   

  	
   

  
	
   

  	
  DAN CAPUTO CO.,

  
	
   

  	
  a California corporation

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Its:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Its:

  	
   

  

 

 

 

21

 

 

EXHIBIT ”A”

 

LEGAL
DESCRIPTION OF PROPERTY

 

 

Real property in the City of Salinas, County
of Monterey, State of California, described as follows:

 

PARCEL A, AS SHOWN ON THAT CERTAIN PARCEL MAP
FILED FOR RECORD DECEMBER 31, 1985 IN THE OFFICE OF THE COUNTY RECORDER OF THE
COUNTY OF MONTEREY, STATE OF CALIFORNIA, IN VOLUME 16 OF PARCEL MAPS, AT PAGE
126.

 

APN:  003-863-031-000

 

 

 

 

1

 

 

EXHIBIT ”B”

 

GRANT
DEED

 

Order No.

Escrow or Loan No.

 

RECORDING REQUESTED BY AND

WHEN RECORDED MAIL TO:

 

Dan
Caputo Co.

1530-A
Parkmoor Avenue

San
Jose, CA 95128-2406

Attn:  Mr. Phil Rolla

 

	
   

  	
   

  	
   

  	
   

  	
  SPACE ABOVE THIS LINE FOR
  RECORDER’S USE

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Mail Tax Statements to:

  	
   

  	
  The undersigned grantor
  declares:

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Documentary Transfer Tax
  is shown on a separate sheet attached to this deed and is not a part of the
  public record.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Attn:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  A.P.N.  003-863-031

  	
   

  	
   

  	
   

  	
   

  

 

GRANT DEED

 

FOR VALUABLE CONSIDERATION, receipt of which
is hereby acknowledged,

 

INTEGRATED DEVICE TECHNOLOGY, INC., a
Delaware corporation,

 

hereby GRANTS to DAN CAPUTO CO., a California
corporation,

 

that certain real property in the City of
Salinas, County of Monterey, State of California, more particularly described
as follows:  See Attachment 1

 

This Grant is made subject to all covenants,
conditions, restrictions, exceptions, easements, rights-of-way, rights of
access, agreements, reservations, encumbrances, liens and other matters of
record; any matter which would be disclosed by accurate survey, investigation
or inquiry; any tax, assessment or other governmental lien against the
property; and subject to existing environmental conditions (if any) including
conditions arising from past uses affecting the property.

 

	
   

  	
   

  	
   

  	
  INTEGRATED DEVICE
  TECHNOLOGY, INC.,

  
	
   

  	
   

  	
   

  	
  a Delaware corporation

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Dated:

  	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Its:

  	
   

  

 

 

1

 

 

	
   

  	
  DO NOT RECORD

  
	
   

  	
   

  
	
   

  	
  FILOR REQUESTS

  
	
   

  	
  DO NOT RECORD STAMP VALUE

  

 

NOTE: 
This Declaration is not a public record

 

Document #

 

DECLARATION OF TAX DUE:  SEPARATE PAPER:

(Revenue and Taxation Code 11932-11933)

 

DOCUMENTARY TRANSFER TAX IS $

 

o                                    Computed on
full value

 

o                                    Computed on
full value less liens or encumbrances remaining at the time of conveyance

 

APN: 
003-863-031

 

Property located in:

 

o                                    Unincorporated

 

ý                                    City of Salinas

 

 

CITY CONVEYANCE TAX IS  $   N/A

 

 

	
   

  	
   

  
	
  Signature of party
  determining tax

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  Name (Typed or Printed)

  	
   

  

 

 

2

 

 

	
  STATE OF CALIFORNIA

  	
   

  	
   

  
	
   

  	
  }

  	
  ss.

  
	
  COUNTY OF

  	
   

  	
   

  

 

On
                                  ,
before me,                                              ,
personally appeared
                                   ,

 

personally known to me —OR- proved to me on
the basis of satisfactory evidence to be the person(s) whose name(s) is/are
subscribed 

	
   

  	
  to the within instrument
  and acknowledged to me that he/she/they executed the same in his/her/their
  authorized capacity(ies), and that by his/her/their signature(s) on the
  instrument the person(s), or the entity upon behalf of which the person(s)
  acted, executed the instrument.

  
	
   

  	
   

  	
   

  
	
   

  	
  WITNESS my hand and
  official seal.

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  SIGNATURE
  OF NOTARY

  	
   

  

 

CAPACITY CLAIMED BY SIGNER

 

Though statute does not require the Notary to
fill in the data below, doing so may prove invaluable to persons relying on the
document.

 

	
   

  	
  INDIVIDUAL

  CORPORATE OFFICERS(S)

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Title(s)

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  PARTNER(S)

  	
  LIMITED

  	
   

  
	
   

  	
   

  	
  GENERAL

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  ATTORNEY-IN-FACT

  TRUSTEE(S)

  GUARDIAN/CONSERVATOR

  OTHER:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  SIGNER IS REPRESENTING:

  	
   

  	
   

  
	
   

  	
  Name of Person(s) or
  Entity(ies)

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  

 

 

 

3

 

 

ATTACHMENT
1

 

LEGAL
DESCRIPTION OF PROPERTY

 

 

Real property in the City of Salinas, County
of Monterey, State of California, described as follows:

 

PARCEL A, AS SHOWN ON THAT CERTAIN PARCEL MAP
FILED FOR RECORD DECEMBER 31, 1985 IN THE OFFICE OF THE COUNTY RECORDER OF THE
COUNTY OF MONTEREY, STATE OF CALIFORNIA, IN VOLUME 16 OF PARCEL MAPS, AT PAGE
126.

 

APN: 
003-863-031-000

 

 

 

4

 

 

EXHIBIT ”C”

 

CERTIFICATION
OF NON-FOREIGN STATUS

(Entity
Transferor)

 

 

Section 1445 of the
Internal Revenue Code provides that a transferee of a U.S. real property
interest must withhold tax if the transferor is a foreign person.  To inform the transferee that withholding of
tax is not required upon the disposition of a U.S. real property interest by
INTEGRATED DEVICE TECHNOLOGY, INC., the undersigned hereby certifies the
following on behalf of INTEGRATED DEVICE TECHNOLOGY, INC.:

 

1.             INTEGRATED DEVICE TECHNOLOGY is not a foreign
corporation, foreign partnership, foreign trust or foreign estate (as those
terms are defined in the Internal Revenue Code and Income Tax Regulations);

 

2.             INTEGRATED DEVICE TECHNOLOGY, INC.’S U.S. employer
identification number is
                                ;
and

 

3.             INTEGRATED DEVICE TECHNOLOGY, INC.’s office address is
2975 Stender Way, Santa Clara, California 95054, Attn: James L. Laufman, Esq.,
General Counsel.

 

INTEGRATED DEVICE
TECHNOLOGY, INC. 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.

 

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 INTEGRATED DEVICE
TECHNOLOGY, INC.

 

	
   

  	
   

  	
   

  	
  INTEGRATED DEVICE
  TECHNOLOGY, INC.

  
	
   

  	
   

  	
   

  	
  a Delaware corporation

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Dated:

  	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Its:

  	
   

  

 

 

1

 

 

EXHIBIT
“D”

 

 

ASSIGNMENT
AND ASSUMPTION OF DECLARATION OF COVENANTS, CONDITIONS

AND RESTRICTIONS

 

 

THIS ASSIGNMENT AND
ASSUMPTION OF DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS
(“Assignment”) is executed effective as of
          , 2003 (the
“Effective Date”) by and between INTEGRATED DEVICE TECHNOLOGY, INC., a Delaware
corporation (“Assignor”), and DAN CAPUTO CO., a California corporation
(“Assignee”).

RECITALS

 

A.            Assignor is the owner of certain real property located in
the City of Salinas, County of Monterey, State of California more particularly
described in Exhibit A attached hereto (“Property”).  Pursuant to a grant deed of even date
herewith, Assignor is conveying the Property to Assignee.

 

B.            The Property is subject to that certain Declaration of
Covenants, Conditions and Restrictions dated as of September 13, 1982 and
recorded on September 21, 1982 in Reel 1579, Page 142 in the Official Records
of Monterey County, California (“Declaration”).

 

C.            In connection with the conveyance of the Property to
Assignee, Assignor desires to assign to Assignee all of Assignor’s right,
title, interest, duties and obligations under the Declaration with respect to
the Property.

 

NOW, THEREFORE, for valuable
consideration, receipt of which is hereby acknowledged, Assignor and Assignee
hereby agree as follows:

 

1.             Assignor does hereby assign, transfer and convey to
Assignee all of Assignor’s right, title, interest, duties and obligations in,
to or under the Declaration with respect to the Property arising from and after
the Effective Date.

 

2.             Assignee hereby accepts the foregoing assignment, and
hereby assumes all of the right, title, interest, duties and obligations of
Assignor in, to and under the Declaration with respect to the Property arising
from and after the Effective Date. 
Assignee hereby acknowledges the obligations of Assignor under the
Declaration and agrees to be bound by the Declaration.

 

3.              This Assignment may be executed in counterparts, each
of which shall be an original, but all of which shall constitute one instrument.  In addition, counterpart signature pages may
be (but shall not be required to be) annexed to one Assignment.  It is the intent hereof that when both
parties have executed one or more counterparts, this Assignment shall be in
full force and effect.

 

 

1

 

 

IN WITNESS WHEREOF, the
parties hereto have executed this Assignment on the dates set forth below, to
be effective as of the Effective Date.

 

	
   

  	
  ASSIGNOR:

  
	
   

  	
   

  	
   

  
	
   

  	
  INTEGRATED DEVICE
  TECHNOLOGY, INC.,

  
	
   

  	
  a Delaware corporation

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Its:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  ASSIGNEE:

  
	
   

  	
   

  	
   

  
	
   

  	
  DAN CAPUTO CO.,

  
	
   

  	
  a California corporation,

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Its:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Its:

  	
   

  

 

 

 

2

 

 

EXHIBIT A

 

DESCRIPTION
OF PROPERTY

 

Real property in the City of Salinas, County
of Monterey, State of California, described as follows:

 

PARCEL A, AS SHOWN ON THAT CERTAIN PARCEL MAP
FILED FOR RECORD DECEMBER 31, 1985 IN THE OFFICE OF THE COUNTY RECORDER OF THE
COUNTY OF MONTEREY, STATE OF CALIFORNIA, IN VOLUME 16 OF PARCEL MAPS, AT PAGE
126.

 

APN: 
003-863-031-000

 

 

 

1<PAGE>

                                                                    Exhibit 10.1

                STOCK REDEMPTION & WARRANT CANCELLATION AGREEMENT

         THIS STOCK REDEMPTION & WARRANT CANCELLATION AGREEMENT is effective as
of May 7th, 2003 (the "Effective Date") by and between HealthGate Data Corp., a
Delaware corporation ("HealthGate"), GE Capital Equity Investments, Inc., a
_______ corporation ("GE Equity"), General Electric Company, a New York
corporation ("GE"), and National Broadcasting Company, Inc., a Delaware
corporation ("NBC"), as successor in interest to both NBC Internet, Inc.
("NBCi") and Snap! LLC ("Snap"). GE Equity, GE, and NBC are also referred to
collectively as "Stockholders".

         WHEREAS, Stockholders own common stock (the "Shares") and warrants (the
"Warrants") of HealthGate as set forth in ATTACHMENT A;

         WHEREAS, HealthGate has entered into a Settlement Agreement and Mutual
Release dated February 21, 2001 with Development Specialists, Inc. ("DSI") as
assignee for the benefit of creditors of Medical SelfCare, Inc. ("SelfCare"),
pursuant to which DSI has agreed that HealthGate has an allowed general
unsecured claim of $5,250,000 (the "Claim") against the assets of SelfCare (the
"SelfCare Settlement Agreement");

         WHEREAS, Stockholders desire to transfer all Stockholders' Shares to
HealthGate and cancel all Warrants in exchange for HealthGate's transfer of the
Claim to NBC.

         NOW THEREFORE, for good and valuable consideration, the receipt of
which is hereby acknowledged by all parties hereto, the parties hereto agree as
follows:

         1. PURCHASE AND SALE OF SHARES.

         (a) GE EQUITY SALE OF 835,485 SHARES. GE Equity hereby sells and
HealthGate hereby purchases from GE Equity effective as of the Effective Date,
835,485 shares of common stock of HealthGate.

         (b) NBC SALE OF 193,539 SHARES. NBC, as successor in interest to NBCi,
hereby sells and HealthGate hereby purchases from NBC effective as of the
Effective Date, 193,539 shares of common stock of HealthGate.

         (c) NBC SALE OF 124,643 SHARES. NBC, as successor in interest to Snap,
hereby sells and HealthGate hereby purchases from NBC effective as of the
Effective Date, 124,643 shares of common stock of HealthGate.

         (d) SHARE CERTIFICATES AND STOCK POWERS. Each Stockholder shall
promptly deliver or cause to be delivered to HealthGate the certificates
representing all of the Shares of the Stock owned by the Stockholder and to be
sold hereunder, with each such certificate duly endorsed in blank or accompanied
by stock transfer powers duly executed in blank.

<PAGE>

         (e) LOST SHARE CERTIFICATES. If a Stockholder cannot locate or
otherwise does not promptly deliver certificates representing the Shares in
accordance with the terms of this Agreement, HealthGate may, at its option, in
addition to all other remedies it may have cancel on its books the certificate
or certificates representing the Shares purchased by HealthGate, and thereupon
all of such Stockholder's rights in and to such repurchased Shares shall
terminate. Each Stockholder hereby grants HealthGate the authority to cancel the
Shares in order to comply with the provisions of this Agreement. Additionally,
Stockholders shall comply with HealthGate's stock transfer agent's procedures
for lost stock certificates.

         2. CANCELLATION OF WARRANTS.

         (a) CANCELLATION OF GE WARRANT. GE hereby agrees that the Warrant No.1,
dated June 17, 1999, issued and registered to GE for 396,600 shares of
HealthGate common stock (such 396,600 shares represent a post-split adjustments
to the original 1,369,200 pre-split shares set forth in said Warrant) is hereby
cancelled without exercise. GE shall promptly deliver or cause to be delivered
to HealthGate said originally executed Warrant marked "cancelled."

         (b) CANCELLATION OF NBCi WARRANT. NBC, as successor in interest to
NBCi, hereby agrees that the Warrant to Purchase Common Stock of HealthGate Data
Corp., dated March 22, 2001, issued and registered to NBCi for 66,666 shares of
HealthGate common stock (such 66,666 shares represent a post-split adjustments
to the original 200,000 pre-split shares set forth in said Warrant) is hereby
cancelled without exercise. NBC shall promptly deliver or cause to be delivered
to HealthGate said originally executed Warrant marked "cancelled."

         (c) LOST WARRANT CERTIFICATES. If a Stockholder cannot locate or
otherwise does not promptly deliver certificates representing the Warrants in
accordance with the terms of this Agreement, HealthGate may, at its option, in
addition to all other remedies it may have cancel on its books the certificate
or certificates representing the Warrants, and thereupon all of such
Stockholder's rights in and to such Warrants shall terminate. Each Stockholder
hereby grants HealthGate the authority to cancel the Warrants in order to comply
with the provisions of this Agreement. Additionally, Stockholders shall comply
with HealthGate's stock transfer agent's procedures for lost warrant
certificates.

         3. PURCHASE PRICE AND PAYMENT. In consideration of the sale by
Stockholders of the Shares and the cancellation of the Warrants, HealthGate
hereby transfers to the Stockholders all its right, title and interest in
HealthGate's $5,250,000 general, unsecured claim against the assets of SelfCare,
as described in the SelfCare Settlement Agreement. All Stockholders hereby
irrevocably instruct HealthGate to transfer such Claim directly to NBC by
executing and delivering to NBC the Assignment of Claim in the form attached
hereto as ATTACHMENT B.

         4. FURTHER ASSURANCES. At the request of any party hereto and without
further consideration, each party shall execute and deliver further instruments
of transfer

                                      -2-

<PAGE>

and assignment (in addition to those delivered under Sections 1, 2 and 3) and
take such other action as a party may reasonably request or require to more
effectively (a) transfer and assign the Shares and the Claim and (b) cancel the
Warrants.

         5. REPRESENTATIONS AND WARRANTIES BY EACH STOCKHOLDER AND HEALTHGATE.
Each of the Stockholders and HealthGate hereby severally represents and warrants
with respect to itself as follows:

         (a) It is duly organized and validly existing under the laws of the
state of its organization.

         (b) It has been duly authorized to enter into this Agreement and to
consummate the transactions contemplated herein.

         (c) This Agreement has been duly executed by it and is a valid and
binding obligation of it, enforceable against it in accordance with its terms,
except insofar as enforceability may be affected by bankruptcy, insolvency or
similar laws affecting creditor's rights generally and the availability of any
particular equitable remedy; without limiting the generality of the foregoing,
NBC represents and warrants it is successor in interest to both NBCi and Snap
and accordingly can execute this Agreement and transfer Shares and cancel
Warrants on behalf of NBCi and Snap.

         (e) Neither the execution or delivery of this Agreement, the
consummation of the transactions contemplated hereby, nor the fulfillment of or
compliance with the terms and conditions hereof conflict with or will result in
a breach or violation of or default under any of the terms, conditions or
provisions of (i) its organizational documents or (ii) any agreement, order,
judgment, decree, arbitration award, statute, regulation or instrument to which
it is a party or by which it or its assets are bound.

         (f) It has such knowledge and experience in financial and business
matters that it is and will be capable of evaluating the merits and risks of
purchase and sale of the Shares, the cancellation of the Warrants and the value
of the Claim.

         (g) It holds of record and owns beneficially the Shares and Warrants
set forth beside its name on ATTACHMENT A hereto, free and clear of any
restrictions on transfer (other than any restrictions under the Securities Act
and state securities laws), taxes, security interests or other liens,
encumbrances, options, warrants, purchase rights, contracts, commitments,
equities, claims, and demands. It is not a party to (i) any option, warrant,
purchase right, or other contract or commitment (other than this Agreement) that
could require it to sell, transfer, or otherwise dispose of any of the Shares or
Warrants or (ii) any contract or commitment regarding rights to vote or rights
to economic benefits with respect to the Shares or Warrants other than
arrangements with affiliates (which arrangements with affiliates shall not
prevent the consummation of the transactions described in this Agreement). Upon
the consummation of the transactions contemplated by this Agreement, good title
to all of the Shares owned by it, free and clear of all claims, liens,
restrictions and encumbrances, shall have been transferred to HealthGate.

                                      -3-

<PAGE>

         (h) The Shares and Warrants listed on Attachment A represent all its
equity interests in HealthGate and it has no options warrants or other rights to
acquire any additional equity interests in HealthGate.

         (i) Except for any approval or consent heretofore obtained, no approval
or consent by any person or entity is required in connection with the execution
and delivery of this Agreement by such party or the performance of such party's
obligations under this Agreement.

         6. ADDITIONAL REPRESENTATIONS AND WARRANTIES BY EACH STOCKHOLDER.
Each of the Stockholders hereby severally represents and warrants with respect
to itself as follows:

         (a) It acknowledges that HealthGate has advised it that (i) DSI, as
assignee for the benefit of creditors, has no liquid assets, (ii) that any
potential recovery on the Claim is speculative and (iii) HealthGate makes no
representation or warranty concerning what recovery, if any, the Stockholders
will receive on the transferred Claim.

         (b) It has carefully reviewed this Agreement and has had the
opportunity to review HealthGate's filings with The U.S. Securities and Exchange
Commission and otherwise make detailed inquiry concerning HealthGate and the
Claim. The Purchaser acknowledges that it has had the opportunity to ask
questions of and receive answers from HealthGate.

         7. REPRESENTATIONS AND WARRANTIES BY HEALTHGATE. HealthGate hereby
represents and warrants with respect to itself as follows:

     (a)  Subject to its disclosures in Section 6(a), above, it has no direct or
          indirect notice, knowledge or awareness of any reason by which the
          Claim is or may be impaired, disallowed (either in whole or in part),
          or otherwise subject to objection, setoff or reduction.

     (b)  It has not taken any action or failed to take any action which has or
          may cause the Claim to be impaired, disallowed (either in whole or in
          part), or otherwise subject to objection, setoff or reduction.

     (c)  It has no direct or indirect knowledge or awareness of any outstanding
          unpaid claim against SelfCare's assets of higher priority than the
          Claim. To the best of its knowledge, the Claim represents
          approximately 38% of the unpaid general unsecured claims outstanding
          against SelfCare's assets.

     (d)  It has no notice or knowledge of any fact or circumstance affecting
          the accuracy of the information contained in records, correspondence,
          memoranda or other documents provided by HealthGate to the
          Stockholders to date, including without limitation, the May 5, 2001
          report by DSI to the creditors of SelfCare, a true and accurate copy
          of which has been provided by HealthGate to the Stockholders.

                                      -4-

<PAGE>

     (e)  It is able to assign and transfer the Claim to NBC, free and clear of
          any restrictions on transfer, taxes, security interests or other
          liens, encumbrances, adverse equities, options, warrants, purchase
          rights, contracts, commitments, equities, claims, and demands. It is
          not a party to any option, right, contract or commitment (other than
          this Agreement) that could require it to sell, assign, transfer, or
          otherwise dispose of the Claim. Upon the consummation of the
          transactions contemplated by this Agreement, the Claim, free and clear
          of all claims, liens, restrictions, adverse equities and encumbrances,
          shall have been transferred to NBC.

     (f)  Each of (i) the Amended and Restated Stockholders Agreement, dated as
          of April 7, 1999 among HealthGate and its stockholders and (ii) the
          lock-up agreements executed by each of HealthGate's stockholders in
          connection with HealthGate's IPO has been terminated and is no longer
          in effect.

         8. HealthGate agrees that within 5 business days following the
execution of this agreement, it will provide to NBC, care of its counsel, copies
of all non-privileged records, correspondence, memoranda and other documents in
its or its counsel's possession relating to the Claim, including, but not
limited to, all non-privileged documents reflecting communications from DSI to
HealthGate and/or other SelfCare creditors.

         9. MISCELLANEOUS.

         (a) COUNTERPARTS. This Agreement may be executed in any number of
counterparts and each such counterpart shall for all purposes be deemed to be an
original, and all such counterparts shall together constitute but one and the
same instrument.

         (b) SUCCESSORS AND ASSIGNS. Except as otherwise provided herein, this
Agreement and all of the terms and provisions hereof shall be binding upon and
inure to the benefit of the parties and their respective administrators,
successors, trustees, legal representatives and assigns.

         (c) ENTIRE AGREEMENT. This instrument contains the entire agreement of
the parties as to the matters covered within, and there are no representations,
covenants or other agreements except as stated or referred to herein. This
Agreement shall not be changed or modified, in whole or in part, except by
supplemental agreement signed by the parties.

         (d) APPLICABLE LAW; VENUE. This Agreement shall be deemed to be a
contract made under the laws of the State of New York and for all purposes shall
be construed in accordance with the laws of said State applicable to contracts
made and to be performed wholly within said State without regard to the conflict
of law principles thereof. The parties hereto irrevocably (i) waive any and all
rights to trial by jury in any proceeding arising out of or related to this
Agreement and (ii) consent to and submit to the jurisdiction of the federal and
state courts located in Massachusetts and New York.

                                      -5-

<PAGE>

         (e) SEC FILINGS. Stockholders acknowledge the transfer of Shares and
cancellation of Warrants hereunder could, without limitation, require one or
more of the Stockholders to file with the U.S. Securities and Exchange
Commission a Form 4 and an amendment to Schedule 13D/13G.

         (f) PRESS RELEASE. None of the parties, nor any of their respective
officers, directors, employees, or affiliated entities over which such party
holds management control shall publish any press release, make any other public
announcement or otherwise communicate with any news media concerning this
Agreement or the transactions contemplated hereby; provided, however, that
nothing contained herein shall prevent any party from promptly making all
filings with governmental authorities, including without limitation, the FCC,
the SEC or securities exchanges as may, in its judgment, be required or
advisable in connection with the execution and delivery of this Agreement or the
consummation of the transactions contemplated herein or by law or the rules and
regulations of any securities exchange; provided further, however, that the
HealthGate shall provide the Stockholders with a reasonable opportunity to
review and comment on any filings with the SEC prior to filing. HealthGate has
previously supplied Stockholders a draft of its Form 8-K that HealthGate intends
to file promptly following the closing of this transaction.

         (g) CAPTIONS. The heading, titles or captions of the sections of this
Agreement and the Attachments hereto are inserted only to facilitate reference,
and they shall not define, limit, extend or describe the scope or intent of this
Agreement or any provision hereof or any Attachment, and they shall not
constitute a part hereof or affect the meaning or interpretation of this
Agreement or any part hereof.

         (h) PARTIES IN INTEREST. Nothing in this Agreement is intended to
confer any rights or remedies under or by reason of this Agreement on any person
other than the parties to it and their respective successors and assigns.
Nothing in this Agreement is intended to relieve or discharge the obligation or
liability of any third persons to any party to this Agreement. No provision of
this Agreement shall give any third persons any right of subrogation or action
over or against any party to this Agreement.

         (i) SURVIVAL OF REPRESENTATIONS; NO OTHER REPRESENTATIONS OR
WARRANTIES. All representations, warranties and agreements made herein by the
parties hereto shall survive the date first set forth above and any
investigations made by or on behalf of the parties. Except for the
representations and warranties contained in Sections 5, 6 and 7, neither party
makes any other or further representations or warranties or agreements of any
sort whatsoever.

         (j) SEVERABILITY. If any term or provision of this Agreement, as
applied to either party or to any circumstance, is declared by a court of
competent jurisdiction to be illegal, unenforceable or void in any situation and
in any jurisdiction, such determination shall not affect the validity or
enforceability of the remaining terms and provisions hereof or the validity or
enforceability of the offending provision in any other situation or in any other
jurisdiction.

                                      -6-

<PAGE>

                         [SIGNATURES ON FOLLOWING PAGE]

                                       -7-

<PAGE>

          IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed as of the 7th day of May 2003.

                                       HealthGate Data Corp.

                                       By: /s/ William S. Reece
                                           --------------------------------
                                           William S. Reece
                                           Chairman & CEO

                                       GE Capital Equity Investments, Inc.

                                       By: [illegible]
                                           --------------------------------

                                       General Electric Company

                                       By: /s/ Michael Jones
                                           --------------------------------
                                           GM, Business Development

                                       National Broadcasting Company, Inc.,
                                       as successor in interest to
                                       NBC Internet, Inc.

                                       By: /s/ Mark Vachon
                                           --------------------------------
                                           Executive Vice President

                                       National Broadcasting Company, Inc.,
                                       as successor in interest
                                       to Snap! LLC

                                       By: /s/ Mark Vachon
                                           -------------------------------
                                           Executive Vice President

ATTACHMENTS

Attachment A - Ownership of Shares and Warrants
Attachment B - Form of Claim Assignment

                                      -8-

<PAGE>

                                  ATTACHMENT A

          GE and Affiliates Ownership of HealthGate Stock and Warrants

<TABLE>
<CAPTION>
                                                   SHARES     WARRANTS
<S>                                              <C>          <C>       <C>
GE Capital Equity Investments, Inc. (10026)         835,485          0
General Electric Company                                  0    396,600
NBC Internet, Inc. (10038)                          193,539     66,666
Snap, LLC. (10029)                                  124,643*         0
                                                  ---------  ---------
                                                  1,153,667    463,266  Total Shares and Warrants: 1,616,933
</TABLE>

         * Note: SNAP holds a certificate for 373,924 pre-split shares.

                                      -9-

<PAGE>

                                  ATTACHMENT B

                     ASSIGNMENT OF GENERAL, UNSECURED CLAIM

         For good and valuable consideration, the receipt of which is hereby
acknowledged, HealthGate Data Corp., a Delaware corporation ("HealthGate"),
hereby transfers and assigns to National Broadcasting Company, Inc., a Delaware
corporation, all right, title and interest to HealthGate's general, unsecured
claim against the assets of Medical SelfCare, Inc. ("SelfCare") in the amount of
FIVE MILLION TWO HUNDRED FIFTY THOUSAND ($5,250,000) DOLLARS (the "Claim").

         Such Claim is established and allowed by, and further described in, the
Settlement Agreement and Mutual Release dated February 21, 2001 by and between
Development Specialists, Inc. ("DSI"), as assignee for the benefit of creditors
of SelfCare, and HealthGate.

         IN WITNESS WHEREOF, the undersigned has caused this Assignment to be
executed on this 7th day of May 2003.

                                              HealthGate Data Corp.

                                              By:    /s/ William S. Reece
                                                     -----------------------
                                              Name:  William S. Reece
                                                     -----------------------
                                              Title: Chairman & CEO
                                                     -----------------------

                                      -10-

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