[PEERY/ARRILLAGA LOGO]
December 10, 1997
Mr. Mike Gulett
PARADIGM TECHNOLOGY, INC.
694 Tasman Drive
Milpitas, CA 95035
Re: CONSENT TO SUBLEASE TO EG&G IC SENSORS, A CALIFORNIA
CORPORATION FOR A PERIOD OF TWO YEARS AND TWO WEEKS,
COMMENCING DECEMBER 15, 1997 AND TERMINATING DECEMBER 31, 1999
Gentlemen:
This letter is written with regard to your proposed sublease of approximately
5,715 square feet of space (as shown on Exhibit A attached hereto) (the "Sublet
Premises") of the 19,855 square feet of space leased by Tenant at 694 Tasman
Drive, Milpitas, California, under Lease Agreement dated December 26, 1996
("Master Lease"), by and between the John Arrillaga Survivor's Trust (previously
known as the "Arrillaga Family Trust") and the Richard T. Peery Separate
Property Trust ("Master Landlord"), and Paradigm Technology, Inc., a California
corporation ("Tenant"), which Tenant is proposing to sublease to EG&G IC
Sensors, a California corporation ("Subtenant") on the terms and conditions set
forth in the proposed Sublease dated November 24, 1997, submitted by Tenant to
Master Landlord on December 8, 1997 (the "Sublease").
Pursuant to Master Lease Paragraph 19 ("Assignment and Subletting") Master
Landlord hereby approves Tenant's subleasing said space to Subtenant, under the
Sublease, subject to the following terms and conditions:
1. Master Landlord's Consent shall in no way void or alter any of the terms
of the Lease by and between Master Landlord and Tenant, nor shall this
Consent alter or diminish in any way Tenant's obligations to Master
Landlord.
2. Tenant shall not give Subtenant any rights or privileges in excess of
those given Tenant under the terms of the Master Lease.
3. Subtenant shall not have a separate address from the address of the
Premises. Therefore, Tenant shall provide Subtenant with internal mail
delivery. Tenant and Subtenant shall share (the prorata shares to be
determined in a separate agreement between Tenant and Subtenant) the
existing signage allocated to Tenant for the Premises.
Initial: __________
4. Master Landlord has not reviewed the terms of any agreement between
Tenant and Subtenant, and in approving said Sublease, Master Landlord is
in no way approving any term, covenant or condition therein contained,
and said Sublease is subject and subordinate to all terms, covenants and
conditions of the Master Lease. Master Landlord shall not be bound by any
agreement other than the terms of the Master Lease between Master
Landlord and Tenant. In the event of conflict in the terms, covenants and
conditions between the Sublease and the Master Lease, the terms,
covenants and conditions of the Master Lease shall prevail and take
precedence over said Sublease. Master Landlord does not make any
warranties or representations as to the condition of the Leased Premises
or the terms of the Lease between Master Landlord and Tenant. This
Consent to Sublease shall in no event be construed as consent to any
future sublease agreement (including any extensions and/or amendments to
the current Sublease) between Tenant and Subtenant, or any other party;
and any future sublease agreement (including any extensions and/or
amendments to the current Sublease) between Tenant and Subtenant, or any
other party shall require the prior written consent of Master Landlord.
5. A. It is agreed by all parties hereto that in the event Master Landlord
terminates the Master Lease, pursuant to any right therein contained,
said Sublease shall automatically terminate simultaneously with the
Master Lease. Notwithstanding anything to the contrary set forth above,
Master Landlord, at Master Landlord's sole option and election, may
choose to allow Subtenant to remain in possession of the Sublet Premises
leased under said Sublease subject to all terms, covenants and conditions
of said Master Lease by giving Subtenant written notice prior to the
effective date of termination of said Master Lease, of Master Landlord's
election to allow Subtenant to remain in possession of the Sublet
Premises in which event Subtenant shall be entitled and obligated to
remain in possession of the Sublet Premises under the terms of said
Sublease, subject to all terms, covenants and conditions of the Master
Lease, including, without limitation to, payment of Basic Rent at the
greater of: (i) the rate provided for in the Master Lease, or (ii) the
rate provided for in the Sublease. Such election by Master Landlord shall
not operate as a waiver of any claims Master Landlord may have against
Tenant. Following such written notice by Master Landlord Subtenant shall
then, as of the effective date of said termination of said Master Lease,
be liable to and shall attorn in writing directly to Master Landlord as
though said Sublease were executed directly between Master Landlord and
Subtenant; provided, however, it is specifically agreed between the
parties hereto, that whether Master Landlord elects to allow Subtenant to
remain in possession of the Sublet Premises under the terms of the
Sublease, subject to the Master Lease, or allow said Sublease to
automatically terminate simultaneously with the Master Lease, Master
landlord shall not, in any event, nor under any circumstances be
responsible or liable to Subtenant for (i) the return of any security
deposit paid by Subtenant to Tenant, nor shall Subtenant be given credit
for any prepaid rental or other monetary consideration paid by Subtenant
to Tenant under said Sublease; (ii) any other claim or damage of any kind
or nature whatsoever by reason of or in connection with Master Landlord's
termination of said Master Lease and/or Sublease; and (iii) any default
of
Initial: __________
Tenant under the Sublease.
B. In the event Master Landlord has terminated the Master Lease, and has
not elected, in writing prior to the effective date of termination of
said Master Lease, to allow Subtenant to remain in the Sublet Premises as
set forth above, said Sublease shall terminate co-terminously with the
effective termination of the Master Lease automatically, without notice
and Subtenant and/or Tenant, jointly and severally, shall surrender the
Sublet Premises to Master Landlord in good condition and repair as of the
effective termination of the Master Lease, with Master Landlord having no
obligation or liability whatsoever to Subtenant by reason of or in
connection with such early termination of the Master Lease. In the event
Subtenant and/or Tenant fails to timely surrender the Sublet Premises to
Master Landlord in good condition and repair as of the date the Master
Lease terminates, Subtenant and/or Tenant, jointly and severally, shall
be liable to Master Landlord in such event for all damages, costs,
claims, losses, liabilities, fees or expenses sustained by Master
Landlord, including, but not limited to, loss of rental income,
attorney's fees and court costs resulting from or in connection with
Subtenant's failure to timely vacate the Sublet Premises and surrender
the Sublet Premises to Master Landlord as of the effective termination
date of said Master Lease.
C. As a condition to Landlord's consent to the Sublease, by execution of
this Consent to Sublease, Subtenant hereby agrees to be bound by the
following provision in relation to both Tenant and Master Landlord:
If Master Landlord and Tenant jointly and voluntarily elect, for
any reason whatsoever, to terminate the Master Lease prior to the
scheduled Master Lease Termination Date, then this Sublease (if
then still in effect) shall terminate concurrently with the
termination of the Master Lease. Subtenant expressly acknowledges
and agrees that (1) the voluntary termination of the Master Lease
by Master Landlord and Tenant and the resulting termination of
this Sublease shall not give Subtenant any right or power to make
any legal or equitable claim against Master Landlord or Tenant,
including without limitation any claim for interference with
contract or interference with prospective economic advantage, and
(2) Subtenant hereby waives any and all rights it may have under
law or at equity to challenge such an early termination of the
Sublease, and unconditionally releases and relieves Master
Landlord and Tenant, and their officers, directors, employees and
agents, from any and all claims, demands, and/or causes of action
whatsoever (collectively, "Claims"), whether such matters are
known or unknown, latent or apparent, suspected or unsuspected,
foreseeable or unforeseeable, which Subtenant may have arising out
of or in connection with any such early termination of this
Sublease. Subtenant knowingly and intentionally waives any and all
protection which is or may be given by Section 1542 of the
California Civil Code which provides as follows: "A general
release does not extend to claims which the creditor does not know
or suspect to exist in his favor at the time of executing the
release, which if known by him must have materially affected his
settlement with
Initial: __________
debtor."
The term of this Sublease is therefore subject to early
termination. Subtenant's initials here below evidence (a)
Subtenant's consideration of and agreement to this early
termination provision, (b) Subtenant's acknowledgment that, in
determining the net benefits to be derived by Subtenant under the
terms of this Sublease, Subtenant has anticipated the potential
for early termination, and (c) Subtenant's agreement to the
general waiver and release of Claims above.
Initials: __________ Initials: __________
Subtenant Tenant
6. In consideration of Master Landlord's consent to the Sublease, Tenant
irrevocably assigns to Master Landlord, as security for Tenant's
obligations under this Lease, all rent and income payable to Tenant under
the Sublease. Therefore Master Landlord may collect all rent due under
the Sublease and apply it towards Tenant's obligations under the Master
Lease. Tenant and Subtenant agree to pay same to Master Landlord upon
demand without further consent of Tenant and Subtenant required;
provided, however, that until the occurrence of a default by Tenant under
the Master Lease, Tenant shall have the right to collect such rent.
Tenant hereby irrevocably authorizes and directs Subtenant, upon receipt
of a written notice from Master Landlord stating that a default exists in
the performance of Tenant's obligations under the Master Lease, to pay to
Master Landlord the rents due and to become due under the Sublease.
Tenant agrees that Subtenant shall have the right to rely on any such
statement and request from Master Landlord, and that Subtenant shall pay
such rents to Master Landlord without any obligation or right to inquire
as to whether such default exists and notwithstanding any notice or claim
from Tenant to the contrary. Tenant shall have no right or claim against
Subtenant or Master Landlord for any such rents so paid by Subtenant to
Master Landlord. It is further agreed between the parties hereto that
neither Tenant's assignment of such rent and income, nor Master
Landlord's acceptance of any payment of rental or other sum due by
Subtenant to Tenant under said Sublease, whether payable directly to
Master Landlord or endorsed to Master Landlord by Tenant, shall in any
way nor in any event be construed as creating a direct contractual
relationship between Master Landlord and Subtenant, unless the Parties
expressly so agree in writing and such acceptance shall be deemed to be
an accommodation by Master Landlord to, and for the convenience of,
Tenant and Subtenant. Any direct contractual agreement between Master
Landlord and Subtenant must be in writing.
7. Pursuant to the provisions of Paragraph 19 entitled "Assignment and
Subletting" of the Master Lease, Master Landlord hereby requires Tenant
to pay to Master Landlord, as Additional Rent, fifty percent of all rents
and/or additional consideration received by Tenant from said Sublease in
excess of the Basic Rent payable to Master Landlord in said
Initial: __________
Lease (hereinafter referred to as "Excess Rent"). Tenant and Subtenant
acknowledge that any Excess Rent is owed to Master Landlord and Tenant
hereby agrees to pay any Excess Rent to Master Landlord as due under said
Sublease. Tenant and Subtenant represent and warrant to Master Landlord
that: (1) the information to be completed and provided by Tenant and
Subtenant on the attached Exhibit B "Summary of Amounts/Consideration to
be Paid by Subtenant" accurately represents amounts to be paid by
Subtenant under said Sublease; (2) no additional consideration is due
Tenant under said Sublease, other than the additional consideration (if
any) identified on Exhibit B; and (3) no changes in the terms and/or
conditions of said Sublease shall be made without Master Landlord's prior
written approval.
8. This Consent is conditional upon Master Landlord's receipt of Master
Landlord's reasonable costs and attorney's fees, to which Master Landlord
is entitled under Paragraph 19 of the Master Lease. Tenant shall pay such
fees and costs to Landlord, pursuant to the invoice provided to Tenant by
Landlord with this Consent, upon execution of this Consent by Tenant and
Subtenant.
9. This Consent to Sublease shall only be considered effective, and Master
Landlord's consent to the Sublease given, when (i) Landlord receives
payment from Tenant of Landlord's costs, and (ii) this Letter Agreement
is executed by Master Landlord, Tenant, and Subtenant, and Guarantors (if
any) under the Master Lease.
Please execute this letter in the space provided below, obtain the signature of
the Subtenant, and return all copies to our office no later than December 31,
1997. IN THE EVENT TENANT FAILS TO RETURN THE FULLY EXECUTED DOCUMENTS TO
LANDLORD BY DECEMBER 31, 1997, THIS CONSENT SHALL BE AUTOMATICALLY RESCINDED, IN
WHICH EVENT, TENANT SHALL BE REQUIRED TO RESUBMIT ITS REQUEST IN THE EVENT
TENANT DESIRES TO GO FORWARD WITH SAID SUBLEASE. A fully executed copy will be
returned to you after execution by the Master Landlord.
Very truly yours,
PEERY/ARRILLAGA
By________________________
John Arrillaga
(SIGNATURES CONTINUED ON FOLLOWING PAGE)
Initial: __________