COMMERCIAL MORTGAGE FINANCING AGREEMENT





   THIS COMMERCIAL MORTGAGE FINANCING AGREEMENT (this "Agreement") is

made and dated as of the 27th day of September, 2002, by and between BANK

OF THE WEST (the "Lender") and MICREL, INCORPORATED, a California

corporation (the "Borrower").



                                   RECITALS



   A.   The Borrower has requested that the Lender extend credit to the

Borrower secured by semiconductor manufacturing facilities located at 1849

and 1931 Fortune Drive, San Jose, California, including the fee interest in

the real property and the improvements located thereon (collectively, the

"Property").

   B.   The Borrower and the Lender desire to set forth herein the terms

and conditions of the making of such credit extension by the Lender and the

repayment obligations of the Borrower with respect thereto.



   NOW, THEREFORE, in consideration of the above Recitals and for other

good and valuable consideration, the receipt and adequacy of which are

hereby acknowledged, the parties hereto hereby agree as follows:



                                   AGREEMENT



   1.   Real Estate Facility.

      1(a)   Loan.  On the terms and subject to the conditions set

forth herein, the Lender agrees that it shall, on the Closing Date (as that

term and capitalized terms not otherwise defined herein are defined in

Paragraph 11 below), make a loan (the "Loan") to the Borrower, in one

disbursement, in the principal amount of $10,736,250.00.



      1(b)   Required Payments of Principal and Interest.  The

principal balance of the Loan shall be payable in fifty nine (59)

consecutive equal monthly installments of $16,890.00, each such installment

to be payable on the last Business Day of each calendar month, commencing

October 30, 2002, and one final installment in the amount necessary to pay

in full the remaining outstanding principal balance of the Loan on the

Final Maturity Date.  The Borrower shall pay interest on the entire

outstanding principal balance of the Loan at a rate per annum equal to, at

the option of and as selected by the Borrower from time to time (subject to

the provisions of Paragraph 2 below):  (1) the daily floating Prime Rate

during the subject interest computation period or (2) the Applicable LIBOR

Rate for the selected Interest Period.



      1(c)   Use of Proceeds.  The proceeds of the Loan shall be used

by the Borrower for general working capital purposes.



   2.   Interest and Other Pricing-Related Provisions.

      2(a)   Conversion and Continuation Options.



         (1)   The Borrower may elect from time to time to

convert the entire principal balance of the Loan which is

outstanding: (i)  as LIBOR Loan to a Prime Rate Loan by giving



the Lender irrevocable notice of such election no later than

10:00 a.m. (Los Angeles time) on the last day of the Interest

Period for such LIBOR Loan, and (ii) as a Prime Rate Loan to a

LIBOR Loan by giving the Lender irrevocable notice of such

election no later than 10:00 a.m. (Los Angeles time) one (1)

Business Day prior to the proposed conversion date.  Any

conversion of a LIBOR Loan to a Prime Rate Loan may only be

made on the last day of the applicable Interest Period.  No

Prime Rate Loan may be converted into a LIBOR Loan if an Event

of Default or Potential Default has occurred and is continuing

at the requested conversion date.  No partial conversion of the

Loan shall be permitted.



         (2)   The Borrower may elect from time to time to

have any LIBOR Loan continued as a LIBOR Loan upon the

expiration of the Interest Period applicable thereto by giving

the Lender irrevocable notice of such election no later than

10:00 a.m. (Los Angeles time) one (1) Business Day prior to the



{PAGE}



last day of such Interest Period; provided, however, that no

LIBOR Loan may be continued as such when any Event of Default

or Potential Default has occurred and is continuing, but shall

be automatically converted to a Prime Rate Loan on the last day

of the Interest Period applicable thereto.  If the Borrower

shall fail to give notice of its election to continue a LIBOR

Loan as such as provided above, the Borrower shall be deemed to

have elected to convert such LIBOR Loan to a Prime Rate Loan on

the last day of the applicable Interest Period.



         (3)   Each request for the conversion or

continuation of the Loan shall be evidenced by the timely

delivery by the Borrower to the Lender of a duly executed

Pricing Request (which delivery may be by facsimile

transmission) or, but only with the prior agreement of the

Lender, telephonically, with any Pricing Request delivered

telephonically to be promptly confirmed in writing (which may

be by facsimile transmission).



         (4)   All Pricing Requests shall be irrevocable and

shall be delivered in writing (which may be by facsimile

transmission), or telephonically to be promptly confirmed in

writing (which may be by facsimile transmission).



       2(b)   Illegality.  Notwithstanding any other provisions

herein, if any law, regulation, treaty or directive or any change therein

or in the governmental, regulatory or judicial interpretation or

application thereof, shall make it unlawful for the Lender to make or

maintain a LIBOR Loan as contemplated by this Agreement:  (1) the

commitment of the Lender hereunder to make or to continue LIBOR Loans or to

convert the Loan into a LIBOR Loan shall forthwith be canceled and (2) any

such type of Loan then outstanding shall be converted automatically to a

Prime Rate Loan at the end of its respective Interest Period or within such

earlier period as may be required by law.  In the event of a conversion of

any such Loan prior to the end of its applicable Interest Period the

Borrower hereby agrees promptly to pay the Lender, upon demand, the amounts

required pursuant to Paragraph 2(e) below, it being agreed and understood

that such conversion shall constitute a prepayment for all purposes hereof.

The provisions hereof shall survive the termination of this Agreement and

payment of all other Obligations.



      2(c)   Inability to Determine Rate.  In the event that the

Lender shall have reasonably determined (which determination shall be

conclusive and binding upon the Borrower) that by reason of circumstances

affecting the London interbank or eurodollar market adequate and reasonable

means do not exist for ascertaining the LIBOR Rate for any Interest Period,

the Lender shall promptly upon such determination so notify the Borrower.

If such notice is given:  (1) if the Loan was to have been continued as or

converted to a LIBOR Loan, as applicable, it shall be continued as or

converted to a Prime Rate Loan or other permissible type of loan and (2) if

the Loan is outstanding as a LIBOR Loan, as applicable, it shall be

converted, on the last day of the then current Interest Period with respect

thereto, to a Prime Rate Loan or other permissible type of loan.  Until

such notice has been withdrawn by the Lender, the Borrower shall not have

the right to have the Loan continued as or converted into a LIBOR Loan, as

applicable.



      2(d)   Requirements of Law; Increased Costs.  In the event that

any applicable law, order, regulation, treaty or directive issued by any

Home        Intelligence        Services        Subscriptions        News        About Us

Contact Us       Terms of Use       Resend Documents       Shopping Cart

Copyright © 2008 The Consus Group LLC