Common use of CONSTRUCTION OF THE PREMISES Clause in Contracts

CONSTRUCTION OF THE PREMISES. 4.1 Landlord shall, at Landlord's sole expense and in compliance with all applicable codes, laws, regulations and ordinances, perform the work set forth on EXHIBIT D annexed hereto ("LANDLORD'S WORK"). Within forty-five (45) days after the Effective Date, Tenant shall complete the preparation of plans and specifications for Tenant's finish-out work and all other work (including any work which is not the responsibility of Landlord as set forth in EXHIBIT D) necessary to prepare the Premises for Tenant's occupancy and deliver same to Landlord and Landlord's architect. Landlord shall, within five (5) business days after receipt of such plans and specifications, either approve or disapprove such plans and specifications. If Landlord disapproves same, Landlord's objections shall be stated with sufficient particularity to permit Tenant to revise said plans. The above procedure shall continue until Tenant's plans and specifications are approved by Landlord (such plans and specifications, as approved by Landlord, hereinafter referred to as "TENANT'S PLANS" and the work shown thereon hereinafter referred to as "TENANT'S WORK"). If Landlord fails to approve or disapprove Tenant's plans and specifications within the aforesaid five (5) business day period, such plans and specifications shall be deemed approved by Landlord. Landlord shall not unreasonably withhold its consent to Tenant's plans and specifications. Within the earlier to occur of (i) sixty (60) days after Landlord has approved Tenant's Plans or (ii) March 15, 1996 (the "PERMIT PERIOD"), Tenant shall use reasonably diligent efforts to obtain a building permit for Tenant's Work (including all signage) and shall deliver Landlord notice upon its receipt thereof ("TENANT'S PERMIT NOTICE"). If Tenant fails to obtain a building permit for Tenant's Work within the Permit Period, Tenant may, without liability or further obligation, terminate this Lease upon written notice to Landlord delivered within five (5) days after the expiration of the Permit Period, and this Lease shall have no further force or effect. If Tenant fails to terminate the Lease as aforesaid within five (5) days after expiration of the Permit Period, Tenant shall be deemed to have received a building permit and Tenant's right to terminate this Lease under this Paragraph shall cease. Notwithstanding the foregoing, if Tenant fails to obtain a building permit for Tenant's Work prior to the expiration of the Permit Period, Landlord shall be entitled to extend the Permit Period by not more than thirty (30) days by notice to Tenant and obtain such permits on Tenant's behalf (Tenant being responsible for any municipal fees to obtain said permits) making only those changes to Tenant's Plans as are approved by Tenant and which are necessary to comply with applicable governmental codes and regulations. If Landlord obtains the permits necessary to complete Tenant's Work within sixty (60) days of expiration of the Permit Period, Tenant's option to terminate this Lease as provided in this paragraph 4.1 shall cease. 4.2 Provided Landlord has delivered the Contingency Satisfaction Notice to Tenant or such Contingency Satisfaction Notice is deemed delivered pursuant to Paragraph 37.14, Landlord shall obtain all necessary approvals, licensing and building permits for Landlord's Work and shall commence construction of Landlord's Work (collectively, "LANDLORD'S PRELIMINARY WORK") on or prior to the date ("LANDLORD'S WORK COMMENCEMENT DATE") which is ten (10) days from the earlier of (i) the date Landlord receives Tenant's Permit Notice or (ii) the date Landlord receives a written notice from Tenant that Tenant has waived its right under Paragraph 4.1 to terminate this Lease because of failure to obtain a building permit (the "PERMIT WAIVER NOTICE") (such notices referred to in clauses (i) and (ii) to be delivered no earlier than sixty (60) days after Lease execution). If Landlord fails to perform Landlord's Preliminary Work on or prior to Landlord's Work Commencement Date, Tenant may, without liability or further obligation, terminate this Lease upon ten (10) days written notice to Landlord, in which event this Lease shall terminate and shall have no further force or effect upon the expiration of such ten (10) day period, unless all necessary approvals, licensing and building permits for Landlord's Work have been obtained and Landlord's Work has commenced prior to the expiration of such ten (10) day period. 4.3 In the event Landlord fails to complete construction of the Landlord's Work and deliver the Premises to Tenant in accordance with Article 5 below within eighty (80) days from Landlord's Work Commencement Date (which date shall not be subject to delays permitted under Article 33) (the "OUTSIDE DATE"), Tenant may, without liability or further obligation, terminate this Lease upon thirty (30) days written notice to Landlord, in which event this Lease shall terminate and shall have no further force or effect upon the expiration of such thirty (30) day period, unless Landlord's Work has been completed prior to the expiration of such thirty (30) day period. 4.4 half (1/2) day's rent (calculated at a one-half of the daily rate based on a thirty day month) for each day such completion and delivery is delayed beyond the Outside Date. It is hereby agreed that the liquidated damages to which Tenant is entitled hereunder is a reasonable estimate of the damages to Tenant that would be caused by Landlord's delay in completing Landlord's Work and delivering the Premises. 4.5 Landlord hereby agrees to pay to Tenant a construction payment (the "CONSTRUCTION PAYMENT") in an amount equal to One Hundred Sixty-five Thousand and 00/100 Dollars ($165,000.00), which Construction Payment is made not as an inducement to Tenant to enter into this Lease but to defray the cost of Tenant's Work. Landlord shall pay the Construction Payment within thirty (30) days after Tenant's Work has been completed, Tenant has obtained a certificate of occupancy for the Premises, Tenant has opened for business and Tenant has delivered lien waivers for all work performed or material supplied (except no lien waivers shall be required for any subcontractor whose work or materials does not exceed $3,000). Provided Tenant has complied with the above requirements, if Landlord fails to pay the Construction Payment within thirty (30) days after notice from Tenant that same is past due, Tenant shall have the right, in addition to any other rights or remedies available to Tenant hereunder, at law or in equity, to offset the amount owing from future installments of Fixed Rent and any additional charges payable by Tenant under the Lease until Tenant is reimbursed said Construction Payment in full, with interest on the remaining balance from the date such Construction Payment was due until so reimbursed to Tenant at the rate of ten percent (10%) per annum. 4.6 Attached hereto as EXHIBIT G are the design elevations and store fronts to be constructed by Tenant as part of Tenant's Work (the "ELEVATION DESIGNS"). Within sixty (60) days after the Effective Date, Landlord shall process and obtain the necessary discretionary approvals from the City of Chico (including the Architectural Review Board) for construction of said Elevation Designs (excluding building permits). Tenant shall give Landlord prior notice of any changes in the Elevation Designs and any material changes thereto shall not be made without the prior written consent of Landlord, which consent shall not be unreasonably withheld or delayed; provided, however, Landlord may withhold its consent if any such material change (i) requires additional approvals from the City of Chico or delay the processing of Landlord's application for said approvals, (ii) requires structural modifications to the building of which the Premises are a part, or (iii) affects the design or dimensions of the Blockbuster Video elevations or storefront. Notwithstanding the foregoing provisions of Paragraph 4.5 and this Paragraph 4.6, within thirty (30) days of the Effective Date, Landlord shall prepare construction drawings for the construction of additional wall openings on the west and south elevations of the Premises, as indicated on EXHIBIT G annexed hereto, including any structural modifications necessary to ensure the structural integrity of the building (whether or not such modifications are located within the Premises) and Tenant shall approve or disapprove such drawings within five (5) days of submission by Landlord and shall cooperate with Landlord to finally approve such drawings within five (5) days after the expiration of such fifteen (15) day preparation period. On or before the latest to occur of (i) ten (10) business days after Tenant's final approval of such drawings or (ii) March 1, 1996, Landlord shall obtain bid submissions for such additional wall openings, from at least three (3) contractors, one (1) of which, at Tenant's option, shall be a contractor designated by Tenant (prior to the date Landlord submits its drawings for bids) and reasonably acceptable to Landlord. Landlord shall immediately thereafter deliver to Tenant copies of the bid packages received by Landlord from all of the bidders, together with an itemized budget showing a detailed breakdown by trade and contractor, unit costs and those additional costs associated with the modifications not located within the Premises but required as a result of the requested wall openings. Within five (5) business days from receipt of the bids by Tenant, Tenant shall direct Landlord whether to accept or reject any of the bids. In the event Tenant directs Landlord to accept any of the bids, Landlord shall arrange for the performance of such work, the Construction Payment shall be reduced by the amount of the lowest bid, together with Landlord's actual out-of-pocket cost to prepare the construction drawings (in an amount not to exceed $4,600), and the construction of such additional wall openings (including, without limitation, any required structural modifications located within or outside the Premises) shall be deemed to be part of Landlord's Work for all purposes of this Lease. In the event Landlord does not perform such work as aforesaid, the Construction Payment shall nevertheless be reduced by Landlord's actual out-of-pocket cost to prepare the construction drawings, in an amount not to exceed $4,600.

CONSTRUCTION OF THE PREMISES. 4.1 Landlord Landlord, through its independent designated contractor, shall, at Landlord's sole expense ’s expense, install the initial improvements specified in the Approved Space Plan and in compliance schedule of improvements/notes attached hereto as Schedules I and II, respectively (collectively, with all applicable codesany subsequent modifications or additions, laws, regulations and ordinances, perform the work set forth on EXHIBIT D annexed hereto ("LANDLORD'S WORK"). Within forty-five (45) days after the Effective Date, Tenant shall complete the preparation of plans and specifications for Tenant's finish-out work and all other work (including any work which is not the responsibility of Landlord as set forth in EXHIBIT D) necessary to prepare the Premises for Tenant's occupancy and deliver same to Landlord and “Landlord's architect. Landlord shall, within five (5) business days after receipt of such plans and specifications, either approve or disapprove such plans and specifications. If Landlord disapproves same, Landlord's objections shall be stated with sufficient particularity to permit Tenant to revise said plans. The above procedure shall continue until Tenant's plans and specifications are approved by Landlord (such plans and specifications, as approved by Landlord, hereinafter referred to as "TENANT'S PLANS" and the work shown thereon hereinafter referred to as "TENANT'S WORK"). If Landlord fails to approve or disapprove Tenant's plans and specifications within the aforesaid five (5) business day period, such plans and specifications shall be deemed approved by Landlord. Landlord shall not unreasonably withhold its consent to Tenant's plans and specifications. Within the earlier to occur of (i) sixty (60) days after Landlord has approved Tenant's Plans or (ii) March 15, 1996 (the "PERMIT PERIOD"), Tenant shall use reasonably diligent efforts to obtain a building permit for Tenant's Work (including all signage) and shall deliver Landlord notice upon its receipt thereof ("TENANT'S PERMIT NOTICE"’s Work”). If Tenant fails to obtain a building permit for Tenant's Work within utilize the Permit Periodentire allowance of any item specified in said Schedules, Tenant may, without liability or further obligation, terminate this Lease upon written notice to Landlord delivered within five (5) days after the expiration of the Permit Period, and this Lease shall have no further force or effect. If Tenant fails to terminate the Lease as aforesaid within five (5) days after expiration of the Permit Period, then Tenant shall be deemed to have received a building permit and Tenant's right to terminate this Lease under this Paragraph shall cease. Notwithstanding the foregoing, if Tenant fails to obtain a building permit for Tenant's Work prior to the expiration of the Permit Period, Landlord shall not be entitled to extend any credit therefor. Landlord shall not be obligated to provide any improvements (including any supplemental HVAC equipment or any furniture or equipment), and the Permit Period by Premises shall be delivered containing no property of any kind, other than Landlord’s Work. Landlord shall pay for the costs of Landlord’s Work (which shall include a fee for Landlord’s construction management in the amount of three percent (3%) of the total cost of Landlord’s Work), to the extent such costs do not more exceed the Improvements Allowance (as defined in Section 1.10 of the Lease). Tenant shall pay, not later than thirty (30) days by notice after the Lease Commencement Date and Tenant’s receipt of a xxxx, for the cost of any portion of Landlord’s Work that exceeds the Improvements Allowance; provided that Landlord shall pay directly (and not from the Improvements Allowance) for the costs of one (1) initial test fit plan and one (1) revision. If the entire Improvements Allowance is not reserved or applied for Landlord’s Work, then Tenant shall not be entitled to Tenant and obtain such permits on Tenant's behalf (Tenant being responsible for any municipal fees to obtain said permits) making only those changes to Tenant's Plans credit therefor; provided that, so long as are approved no Event of Default by Tenant and then exists, Tenant shall receive a credit of such unused portion of the Improvements Allowance, not to exceed fifteen percent (15%) of the Improvements Allowance (the “Unused Allowance”), as follows: Landlord shall, at Tenant’s request, which are necessary to comply with applicable governmental codes and regulations. If Landlord obtains the permits necessary to complete Tenant's Work request shall be made within sixty (60) days of expiration of the Permit Period, Tenant's option to terminate this Lease as provided in this paragraph 4.1 shall cease. 4.2 Provided Landlord has delivered the Contingency Satisfaction Notice to Tenant or such Contingency Satisfaction Notice is deemed delivered pursuant to Paragraph 37.14, Landlord shall obtain all necessary approvals, licensing and building permits for Landlord's Work and shall commence construction following substantial completion of Landlord's Work (collectively’s Work, "LANDLORD'S PRELIMINARY WORK") on or prior to the date ("LANDLORD'S WORK COMMENCEMENT DATE") which is ten (10) days from the earlier of (i) the date Landlord receives Tenant's Permit Notice or (ii) the date Landlord receives a written notice from and provided Tenant that Tenant has waived its right under Paragraph 4.1 to terminate this Lease because of failure to obtain a building permit (the "PERMIT WAIVER NOTICE") (such notices referred to in clauses (i) submits invoices therefor and (ii) to be delivered no earlier than sixty (60) days after Lease execution). If Landlord fails to perform Landlord's Preliminary Work on or prior to Landlord's Work Commencement Date, Tenant may, without liability or further obligation, terminate this Lease upon ten (10) days written notice to Landlord, in which event this Lease shall terminate and shall have no further force or effect upon the expiration of such ten (10) day period, unless all necessary approvals, licensing and building permits for Landlord's Work have been obtained and Landlord's Work has commenced prior to the expiration of such ten (10) day period. 4.3 In the event Landlord fails to complete construction of the Landlord's Work and deliver the Premises to Tenant in accordance with Article 5 below within eighty (80) days from Landlord's Work Commencement Date (which date shall not be subject to delays permitted under Article 33) (the "OUTSIDE DATE"), Tenant may, without liability or further obligation, terminate this Lease upon thirty (30) days written notice to Landlord, in which event this Lease shall terminate and shall have no further force or effect upon the expiration of such thirty (30) day period, unless Landlord's Work has been completed prior to the expiration of such thirty (30) day period. 4.4 half (1/2) day's rent (calculated at a one-half of the daily rate based on a thirty day month) for each day such completion and delivery is delayed beyond the Outside Date. It is hereby agreed that the liquidated damages to which Tenant is entitled hereunder is a reasonable estimate of the damages to Tenant that would be caused by Landlord's delay in completing Landlord's Work and delivering the Premises. 4.5 Landlord hereby agrees to pay to Tenant a construction payment (the "CONSTRUCTION PAYMENT") in an amount equal to One Hundred Sixty-five Thousand and 00/100 Dollars ($165,000.00), which Construction Payment is made not as an inducement to Tenant to enter into this Lease but to defray the cost of Tenant's Work. Landlord shall pay the Construction Payment within thirty (30) days after Tenant's Work has been completed, Tenant has obtained a certificate of occupancy for the Premises, Tenant has opened for business and Tenant has delivered lien waivers for all work performed or material supplied (except no lien waivers shall be required for any subcontractor whose work or materials does not exceed $3,000). Provided Tenant has complied with the above requirements, if Landlord fails to pay the Construction Payment within thirty (30) days after notice from Tenant that same is past due, Tenant shall have the right, in addition to any other rights or remedies available to Tenant hereunder, at law or in equity, to offset the amount owing from future installments of Fixed Rent and any additional charges payable by Tenant under the Lease until Tenant is reimbursed said Construction Payment in full, with interest on the remaining balance from the date such Construction Payment was due until so reimbursed to Tenant at the rate of ten percent (10%) per annum. 4.6 Attached hereto as EXHIBIT G are the design elevations and store fronts to be constructed by Tenant as part of Tenant's Work (the "ELEVATION DESIGNS"). Within sixty (60) days after the Effective Date, Landlord shall process and obtain the necessary discretionary approvals from the City of Chico (including the Architectural Review Board) for construction of said Elevation Designs (excluding building permits). Tenant shall give Landlord prior notice of any changes in the Elevation Designs and any material changes thereto shall not be made without the prior written consent of Landlord, which consent shall not be unreasonably withheld or delayed; provided, however, Landlord may withhold its consent if any such material change (i) requires additional approvals from the City of Chico or delay the processing of Landlord's application for said approvals, (ii) requires structural modifications to the building of which the Premises are a part, or (iii) affects the design or dimensions of the Blockbuster Video elevations or storefront. Notwithstanding the foregoing provisions of Paragraph 4.5 and this Paragraph 4.6, within thirty (30) days of the Effective Date, Landlord shall prepare construction drawings for the construction of additional wall openings on the west and south elevations beneficial use of the Premises, as indicated on EXHIBIT G annexed hereto, including any structural modifications necessary to ensure the structural integrity of the building (whether or not such modifications are located within the Premises) and Tenant shall approve or disapprove such drawings within five (5) days of submission by Landlord and shall cooperate with Landlord to finally approve such drawings within five (5) days after the expiration of such fifteen (15) day preparation period. On or before the latest to occur of (i) ten (10) business days after Tenant's final approval of such drawings or (ii) March 1, 1996, Landlord shall obtain bid submissions for such additional wall openings, from at least three (3) contractors, one (1) of which, at Tenant's option, shall be a contractor designated by reimburse Tenant (prior up to the date Landlord submits its drawings Unused Allowance) for bids) certain “soft” costs related to the architectural and reasonably acceptable to Landlord. Landlord shall immediately thereafter deliver to Tenant copies engineering design fees, installation of the bid packages received by Landlord from all of the biddersCabling and Tenant’s reasonable, together with an itemized budget showing a detailed breakdown by trade and contractor, unit costs and those additional costs associated with the modifications not located within the Premises but required as a result of the requested wall openings. Within five (5) business days from receipt of the bids by Tenant, Tenant shall direct Landlord whether to accept or reject any of the bids. In the event Tenant directs Landlord to accept any of the bids, Landlord shall arrange for the performance of such work, the Construction Payment shall be reduced by the amount of the lowest bid, together with Landlord's actual out-of-pocket cost moving expenses incurred by Tenant in moving into the Premises. Except as otherwise provided in Schedule II, all work and materials to prepare be performed or provided by Landlord pursuant to this Exhibit shall be Building Standard items consistent in type and quality with the construction drawings (most recent buildout of the Premises. All amounts payable by Tenant pursuant to this Exhibit shall be considered additional rent and subject to all applicable provisions of the Lease. Notwithstanding the foregoing, except as otherwise expressly provided herein, Landlord shall not be required to perform work which would require changes to structural components or the exterior design of the Building, require any material modification to the Building’s mechanical installations or installations outside the Premises, not comply with all Laws, be incompatible with the building plans filed with appropriate governmental authorities or with the occupancy of the Building as a first-class office building, or delay the completion of any other work in an amount not to exceed $4,600), and the Building. Any changes required by any government department affecting the construction of such additional wall openings (including, without limitation, any required structural modifications located within the Building or outside the Premises) Premises shall not be deemed to be part of Landlord's Work for all purposes violate any plans or provisions of this Lease. In the event Landlord does not perform such work as aforesaidExhibit, the Construction Payment and shall nevertheless be reduced accepted by Landlord's actual out-of-pocket cost to prepare the construction drawings, in an amount not to exceed $4,600Tenant.

CONSTRUCTION OF THE PREMISES. 4.1 Landlord shallA. Landlord, at Landlord's sole expense cost and expense, shall construct the "Base Building", and the Common Areas, in accordance with the plans and specifications prepared by Landlord's architect described on Exhibit G (the Base Building Plans and Specifications), and in compliance with all applicable codeslegal requirements and all matters of record affecting the Property. All materials and equipment to be incorporated into the Base Building and Common Areas shall be new and of good quality and in good operating condition, lawsand construction shall be free from faults and defects. Construction not conforming to these requirements shall be corrected. Tenant shall be entitled to obtain changes to the Base Building Plans and Specifications by reason of Tenant's request for either additional or substituted items within the Base Building, regulations and ordinances, perform (the work set forth on EXHIBIT D annexed hereto ("LANDLORD'S WORKBase Building Upgrades"). Within forty-five All costs (45including without limitation all design, engineering and construction costs) days after which Landlord shall incur to design, implement or furnish the Effective Date, Base Building Upgrades shall be at the sole cost and expense of Tenant. Tenant shall complete be entitled to direct that Landlord apply either or both the preparation improvement Allowance or improvement Loan to the payment of plans Base Building Upgrades. Attached hereto as Exhibit M is the Workletter dealing with the performance of the Base Building, Base Building Upgrades and specifications for the Initial Leasehold Improvements. F. If Landlord's Contractor is selected to perform the Initial Leasehold Improvements, such work shall be performed, at Tenant's finish-out work expense, in accordance with the following provisions of this Section 28.F: (1) Landlord shall contract with Landlord's Contractor for performance of the Initial Leasehold Improvements. In addition, Landlord shall be responsible for obtaining the construction permits for the Initial Leasehold Improvements and all other work the use and occupancy permits for the Premises. (including any work which is 2) All materials and equipment to be incorporated into the Initial Leasehold Improvements shall be new and of good quality and in good operating condition, and construction shall be free from faults and defects. Construction not the responsibility of Landlord as set forth in EXHIBIT Dconforming to these requirements shall be corrected. (3) necessary Tenant shall be given access to prepare the Premises during the period when Landlord is constructing the Initial Leasehold Improvements, for Tenant's occupancy the purpose of installing telephone and deliver same to Landlord computer cabling and equipment, other special equipment, fixtures and furniture therein, provided that (i) Tenant shall coordinate such installations with Landlord's architect. Landlord shallContractor, within five (5ii) business days after receipt of such plans and specifications, either approve or disapprove such plans and specifications. If Landlord disapproves same, Landlord's objections shall be stated with sufficient particularity to permit Tenant to revise said plans. The above procedure shall continue until Tenant's plans and specifications are approved by Landlord (such plans and specifications, as approved by Landlord, hereinafter referred to as "TENANT'S PLANS" and the work shown thereon hereinafter referred to as "TENANT'S WORK"). If Landlord fails to approve or disapprove Tenant's plans and specifications within the aforesaid five (5) business day period, such plans and specifications shall be deemed approved by Landlord. Landlord installations shall not unreasonably withhold impede, hinder or delay Landlord's completion of the Base Building or the Initial Leasehold Improvements or obtaining a use and occupancy permit for the Premises, (iii) Tenant shall maintain the liability insurance coverage required by this Lease, and (iv) Tenant shall indemnify Landlord against any and all damages sustained in connection with the installation of such furniture, fixtures and equipment, unless such damage is caused by the negligence or willful misconduct of Landlord, its consent agents, employees or contractors. G. If Tenant elects to have the Initial Leasehold Improvements performed by Tenant's plans and specifications. Within the earlier to occur of (i) sixty (60) days after Landlord has approved Contractor, such work shall be performed, at Tenant's Plans or expense, in accordance with the following provisions of this Section 28.G: (ii1) March 15, 1996 (the "PERMIT PERIOD"), Tenant shall use reasonably diligent efforts to obtain a building permit for contract with Tenant's Work (including all signage) and shall deliver Landlord notice upon its receipt thereof ("TENANT'S PERMIT NOTICE"). If Tenant fails to obtain a building permit Contractor for Tenant's Work within the Permit Period, Tenant may, without liability or further obligation, terminate this Lease upon written notice to Landlord delivered within five (5) days after the expiration performance of the Permit Period, and this Lease shall have no further force or effectInitial Leasehold Improvements. If Tenant fails to terminate the Lease as aforesaid within five (5) days after expiration of the Permit PeriodIn addition, Tenant shall be deemed responsible for obtaining the construction permits for the Initial Leasehold Improvements and the use and occupancy permits for the Premises. (2) All contractors performing such construction must be licensed to have received a building permit perform such work in the State of Maryland, and such contractors, or Tenant's right , must maintain all insurance required by Section 16.B of this Lease. (3) Such construction shall be performed in accordance with the Leasehold Improvement Plans and Specifications, and in compliance with all legal requirements and all matters of record affecting the Property. All materials and equipment to terminate this Lease under this Paragraph be incorporated into the Initial Leasehold Improvements shall ceasebe new and of good quality and in good operating condition, and construction shall be free from faults and defects. Notwithstanding the foregoing, if Tenant fails Construction not conforming to obtain a building permit for Tenant's Work prior to the expiration of the Permit Period, these requirements shall be corrected. Landlord shall be entitled to extend the Permit Period by not more than thirty (30) days by notice to Tenant and obtain such permits on Tenant's behalf (Tenant being responsible for any municipal fees to obtain said permits) making only those changes to Tenant's Plans as are approved oversee all construction by Tenant and which are necessary hereunder in order to comply with applicable governmental codes and regulations. If Landlord obtains the permits necessary to complete Tenant's Work within sixty (60) days of expiration assure compliance by Tenant of the Permit Period, Tenant's option to terminate this Lease as provided in this paragraph 4.1 shall ceaseapproved plans and specifications. 4.2 Provided (4) Tenant shall indemnify Landlord has delivered the Contingency Satisfaction Notice to Tenant or such Contingency Satisfaction Notice is deemed delivered pursuant to Paragraph 37.14, Landlord shall obtain all necessary approvals, licensing and building permits for Landlord's Work and shall commence construction of Landlord's Work (collectively, "LANDLORD'S PRELIMINARY WORK") on or prior to the date ("LANDLORD'S WORK COMMENCEMENT DATE") which is ten (10) days from the earlier of against (i) any damage sustained in connection with the date Landlord receives work performed by any contractors retained by Tenant's Permit Notice , unless such damage is caused by negligence or (ii) the date Landlord receives a written notice from Tenant that Tenant has waived willful misconduct of Landlord, its right under Paragraph 4.1 to terminate this Lease because of failure to obtain a building permit (the "PERMIT WAIVER NOTICE") (such notices referred to in clauses (i) agents, employees or contractors, and (ii) to be delivered no earlier than sixty (60) days after Lease execution). If Landlord fails to perform Landlordany mechanics' or materialmen's Preliminary Work on liens against the Premises or prior to Landlord's Work Commencement Date, Tenant may, without liability or further obligation, terminate this Lease upon ten (10) days written notice to Landlord, in which event this Lease shall terminate and shall have no further force or effect upon the expiration of such ten (10) day period, unless all necessary approvals, licensing and building permits for Landlord's Work have been obtained and Landlord's Work has commenced prior to Building arising from the expiration of such ten (10) day periodwork performed by any contractors retained by Tenant. 4.3 In the event Landlord fails to complete construction of the Landlord's Work and deliver the Premises to Tenant in accordance with Article 5 below within eighty (805) days from Landlord's Work Commencement Date (which date shall not be subject to delays permitted under Article 33) (the "OUTSIDE DATE"), Tenant may, without liability or further obligation, terminate this Lease upon thirty (30) days written notice to Landlord, in which event this Lease shall terminate and shall have no further force or effect upon the expiration of such thirty (30) day period, unless Landlord's Work has been completed prior to the expiration of such thirty (30) day period. 4.4 half (1/2) day's rent (calculated at a one-half of the daily rate based on a thirty day month) for each day such completion and delivery is delayed beyond the Outside Date. It is hereby agreed that the liquidated damages to which Tenant is entitled hereunder is a reasonable estimate of the damages to Tenant that would be caused by Landlord's delay in completing Landlord's Work and delivering the Premises. 4.5 Landlord hereby agrees to pay to Tenant a construction payment (the "CONSTRUCTION PAYMENT") in an amount equal to One Hundred Sixty-five Thousand and 00/100 Dollars ($165,000.00), which Construction Payment is made not as an inducement to Tenant to enter into this Lease but to defray the cost of Tenant's Work. Landlord shall pay the Construction Payment within thirty (30) days after Tenant's Work has been completed, Tenant has obtained a certificate of occupancy for the Premises, Tenant has opened for business and Tenant has delivered lien waivers for all work performed or material supplied (except no lien waivers shall be required for any subcontractor whose work or materials does not exceed $3,000). Provided Tenant has complied with the above requirements, if Landlord fails to pay the Construction Payment within thirty (30) days after notice from Tenant that same is past due, Tenant shall have the right, in addition to any other rights or remedies available to Tenant hereunder, at law or in equity, to offset the amount owing from future installments of Fixed Rent and any additional charges payable by Tenant under the Lease until Tenant is reimbursed said Construction Payment in full, with interest on the remaining balance from the date such Construction Payment was due until so reimbursed to Tenant at the rate of ten percent (10%) per annum. 4.6 Attached hereto as EXHIBIT G are the design elevations and store fronts to be constructed by Tenant as part of Tenant's Work (the "ELEVATION DESIGNS"). Within sixty (60) days after the Effective Date, Landlord shall process and obtain the necessary discretionary approvals from the City of Chico (including the Architectural Review Board) for construction of said Elevation Designs (excluding building permits). Tenant shall give Landlord prior notice of any changes in the Elevation Designs and any material changes thereto shall not be made without the prior written consent of Landlord, which consent shall not be unreasonably withheld or delayed; provided, however, Landlord may withhold its consent if any such material change (i) requires additional approvals from the City of Chico or delay the processing of Landlord's application for said approvals, (ii) requires structural modifications to the building of which the Premises are a part, or (iii) affects the design or dimensions portion of the Blockbuster Video elevations or storefront. Notwithstanding the foregoing provisions of Paragraph 4.5 and this Paragraph 4.6, within thirty (30) days of the Effective Date, Landlord shall prepare construction drawings for the construction of additional wall openings on the west and south elevations of the Premises, as indicated on EXHIBIT G annexed hereto, including any structural modifications necessary to ensure the structural integrity of the building (whether or not such modifications are located within the Premises) and Tenant shall approve or disapprove such drawings within five (5) days of submission by Landlord and shall cooperate with Landlord to finally approve such drawings within five (5) days after the expiration of such fifteen (15) day preparation period. On or before the latest to occur of (i) ten (10) business days after Tenant's final approval of such drawings or (ii) March 1, 1996, Landlord shall obtain bid submissions for such additional wall openings, from at least three (3) contractors, one (1) of which, at Tenant's option, shall be a contractor designated by Tenant (prior to the date Landlord submits its drawings for bids) and reasonably acceptable to Landlord. Landlord shall immediately thereafter deliver to Tenant copies of the bid packages received by Landlord from all of the bidders, together with an itemized budget showing a detailed breakdown by trade and contractor, unit costs and those additional costs associated with the modifications not located within the Premises but required as a result of the requested wall openings. Within five (5) business days from receipt of the bids by Tenant, Tenant shall direct Landlord whether to accept or reject any of the bids. In the event Tenant directs Landlord to accept any of the bids, Landlord shall arrange for the performance of such work, the Construction Payment shall be reduced by the amount of the lowest bid, together with Landlord's actual out-of-pocket cost to prepare the construction drawings (in an amount not to exceed $4,600), Improvement Allowance and the construction of such additional wall openings Improvement Loan (including, without limitation, any required structural modifications located within or outside the Premisesif any) shall be deemed remaining after payment for architect's charges pursuant to be part of Landlord's Work for all purposes of this Lease. In the event Landlord does not perform such work as aforesaid, the Construction Payment shall nevertheless be reduced by Landlord's actual out-of-pocket cost to prepare the construction drawings, in an amount not to exceed $4,600.Section

CONSTRUCTION OF THE PREMISES. 4.1 Landlord shall, at Landlord's sole expense and Tenant acknowledges that the Premises is located in compliance with all applicable codes, laws, regulations and ordinances, perform the work an existing building. Except as otherwise set forth on EXHIBIT D annexed hereto herein, Landlord makes no warranty or representation to Tenant concerning the condition of the Building, and Landlord shall promptly repair any defects in the Building provided Landlord is notified within six ("LANDLORD'S WORK"6) months of the Delivery Date of any such defects). Within forty-five (45) days after the Effective Date, Tenant shall complete the preparation of plans and specifications Except for Tenant's finish-out work and all other work (including any work which is not the responsibility of Landlord defects as set forth in EXHIBIT D) necessary to prepare the immediately preceding sentence and the Systems Delivery set forth in the paragraph below, Tenant accepts the Premises in their current “AS-IS” condition and Landlord has no obligation to perform any work therein (including demolition of any improvements existing therein or construction of any tenant finish-work or other improvements therein). Furthermore, Landlord shall not be obligated to reimburse Tenant or provide an allowance for Tenant's occupancy any costs related to the demolition or construction of improvements therein, except as expressly set forth in Exhibit D attached hereto. Notwithstanding the foregoing, Landlord shall deliver (the “Systems Delivery”) the heating and air conditioning systems and equipment serving the Premises (the “HVAC”), plumbing, lighting, life safety and electrical systems serving the Premises in good working order and condition on the date Landlord delivers possession of the Premises to Tenant (the “Delivery Date”). If Tenant claims that such systems were not in good working order on the Delivery Date, Tenant must deliver same written notice of such claim (the “Failure Notice”) to Landlord and Landlord's architect. Landlord shallwithin ninety (90) days of the Delivery Date, within five (5) business days after receipt time being of the essence in the giving of such plans notice, and specifications, either approve or disapprove Tenant’s sole remedy for such plans failure shall be that Landlord shall cause such systems to be placed in good working order at Landlord’s sole cost and specificationsexpense. If Tenant fails to timely deliver a Failure Notice to Landlord, Landlord disapproves sameshall have no further obligations with respect to this provision. Notwithstanding anything to the contrary contained herein, Landlord shall have no obligation to repair the HVAC, plumbing, mechanical or electrical systems in the event the need for such repair is caused by Tenant or if Tenant fails to comply with Section 17.2 herein regarding Tenant’s obligation to maintain a HVAC maintenance contract. Upon delivery of possession of the Premises by Landlord's objections , Tenant will proceed with due diligence, at its own expense, to perform all work and supply all installations described as Tenant’s Work in Exhibit D (including without limitation obtaining any necessary permits for such Tenant’s Work), and to fully equip the Premises with all trade fixtures, lighting fixtures, furniture, furnishings, floor and wall coverings, exterior signs, and special equipment and other items of construction and personal property necessary for the completion of the Premises and the proper operation of Tenant’s business therein. Tenant’s Work shall be stated performed with sufficient particularity to permit materials of good quality and in a proper workmanlike manner, and, unless the Landlord gives its prior written consent otherwise, all items installed by Tenant to revise said plansin the Premises shall be new. The above procedure Tenant shall continue until Tenant's not do any construction work or alterations, nor shall Tenant install any equipment other than trade fixtures and personal property without first obtaining Landlord’s written approval of the plans and specifications are approved therefor in accordance with Exhibit D. The approval by Landlord (such plans and specifications, as approved by Landlord, hereinafter referred to as "TENANT'S PLANS" and the work shown thereon hereinafter referred to as "TENANT'S WORK"). If Landlord fails to approve or disapprove Tenant's plans and specifications within the aforesaid five (5) business day period, of such plans and specifications shall be deemed approved by Landlordnot constitute SUMMIT RIDGE BUSINESS PARK/INOVIO PHARMACEUTICALS, INC. Landlord shall not unreasonably withhold its consent to Tenant's plans and specifications. Within – PAGE 8 the earlier to occur assumption of (i) sixty (60) days after Landlord has approved Tenant's Plans or (ii) March 15, 1996 (any liability on the "PERMIT PERIOD"), Tenant shall use reasonably diligent efforts to obtain a building permit for Tenant's Work (including all signage) and shall deliver Landlord notice upon its receipt thereof ("TENANT'S PERMIT NOTICE"). If Tenant fails to obtain a building permit for Tenant's Work within the Permit Period, Tenant may, without liability or further obligation, terminate this Lease upon written notice to Landlord delivered within five (5) days after the expiration part of the Permit PeriodLandlord for their accuracy or their conformity with requirements of any building code, or other municipal or governmental regulation or ordinance, and this Lease shall have no further force or effect. If Tenant fails to terminate the Lease as aforesaid within five (5) days after expiration of the Permit Period, Tenant shall be deemed to have received a building permit and Tenant's right to terminate this Lease under this Paragraph shall cease. Notwithstanding the foregoing, if Tenant fails to obtain a building permit for Tenant's Work prior to the expiration of the Permit Period, Landlord shall be entitled to extend the Permit Period by not more than thirty (30) days by notice to Tenant and obtain such permits on Tenant's behalf (Tenant being solely responsible for such plans and specifications and compliance of Tenant’s Work with all governmental requirements. Prior to commencement of any municipal fees to obtain said permits) making only those changes to Tenant's Plans as are approved by Tenant and which are necessary to comply with applicable governmental codes and regulations. If Landlord obtains the permits necessary to complete Tenant's Work within sixty (60) days of expiration of the Permit Period, Tenant's option to terminate this Lease as provided in this paragraph 4.1 shall cease. 4.2 Provided Landlord has delivered the Contingency Satisfaction Notice to Tenant or such Contingency Satisfaction Notice is deemed delivered pursuant to Paragraph 37.14, Landlord shall obtain all necessary approvals, licensing and building permits for Landlord's Work and shall commence construction of Landlord's Work (collectively, "LANDLORD'S PRELIMINARY WORK") on or prior to the date ("LANDLORD'S WORK COMMENCEMENT DATE") which is ten (10) days from the earlier of (i) the date Landlord receives Tenant's Permit Notice or (ii) the date Landlord receives a written notice from Tenant that Tenant has waived its right under Paragraph 4.1 to terminate this Lease because of failure to obtain a building permit (the "PERMIT WAIVER NOTICE") (such notices referred to in clauses (i) and (ii) to be delivered no earlier than sixty (60) days after Lease execution). If Landlord fails to perform Landlord's Preliminary Work on or prior to Landlord's Work Commencement Date, Tenant may, without liability or further obligation, terminate this Lease upon ten (10) days written notice to Landlord, in which event this Lease shall terminate and shall have no further force or effect work upon the expiration of such ten (10) day period, unless all necessary approvals, licensing and building permits for Landlord's Work have been obtained and Landlord's Work has commenced prior to the expiration of such ten (10) day period. 4.3 In the event Landlord fails to complete construction of the Landlord's Work and deliver the Premises to Tenant in accordance with Article 5 below within eighty (80) days from Landlord's Work Commencement Date (which date shall not be subject to delays permitted under Article 33) (the "OUTSIDE DATE"), Tenant may, without liability or further obligation, terminate this Lease upon thirty (30) days written notice to Landlord, in which event this Lease shall terminate and shall have no further force or effect upon the expiration of such thirty (30) day period, unless Landlord's Work has been completed prior to the expiration of such thirty (30) day period. 4.4 half (1/2) day's rent (calculated at a one-half of the daily rate based on a thirty day month) for each day such completion and delivery is delayed beyond the Outside Date. It is hereby agreed that the liquidated damages to which Tenant is entitled hereunder is a reasonable estimate of the damages to Tenant that would be caused by Landlord's delay in completing Landlord's Work and delivering the Premises. 4.5 Landlord hereby agrees to pay to Tenant a construction payment (the "CONSTRUCTION PAYMENT") in an amount equal to One Hundred Sixty-five Thousand and 00/100 Dollars ($165,000.00), which Construction Payment is made not as an inducement to Tenant to enter into this Lease but to defray the cost of Tenant's Work. Landlord shall pay the Construction Payment within thirty (30) days after Tenant's Work has been completed, Tenant has obtained a certificate of occupancy for the Premises, Tenant has opened for business and Tenant has delivered lien waivers for all work performed or material supplied (except no lien waivers shall be required for any subcontractor whose work or materials does not exceed $3,000). Provided Tenant has complied with the above requirements, if Landlord fails to pay the Construction Payment within thirty (30) days after notice from Tenant that same is past due, Tenant shall have the right, in addition to any other rights or remedies available to Tenant hereunder, at law or in equity, to offset the amount owing from future installments of Fixed Rent and any additional charges payable by Tenant under the Lease until Tenant is reimbursed said Construction Payment in full, with interest on the remaining balance from the date such Construction Payment was due until so reimbursed to Tenant at the rate of ten percent (10%) per annum. 4.6 Attached hereto as EXHIBIT G are the design elevations and store fronts to be constructed by Tenant as part of Tenant's Work (the "ELEVATION DESIGNS"). Within sixty (60) days after the Effective Date, Landlord shall process and obtain the necessary discretionary approvals from the City of Chico (including the Architectural Review Board) for construction of said Elevation Designs (excluding building permits). Tenant shall give Landlord prior notice of any changes in the Elevation Designs and any material changes thereto shall not be made without the prior written consent of Landlord, which consent shall not be unreasonably withheld or delayed; provided, however, Landlord may withhold its consent if any such material change (i) requires additional approvals from the City of Chico or delay the processing of Landlord's application for said approvals, (ii) requires structural modifications to the building of which the Premises are a part, or (iii) affects the design or dimensions of the Blockbuster Video elevations or storefront. Notwithstanding the foregoing provisions of Paragraph 4.5 and this Paragraph 4.6, within thirty (30) days of the Effective Date, Landlord shall prepare construction drawings for the construction of additional wall openings on the west and south elevations of the Premises, as indicated on EXHIBIT G annexed hereto, including any structural modifications necessary to ensure the structural integrity of the building (whether or not such modifications are located within the Premises) and Tenant shall approve or disapprove such drawings within five (5) days of submission by Landlord and shall cooperate with Landlord to finally approve such drawings within five (5) days after the expiration of such fifteen (15) day preparation period. On or before the latest to occur of (i) ten (10) business days after Tenant's final approval of such drawings or (ii) March 1, 1996, Landlord shall obtain bid submissions for such additional wall openings, from at least three (3) contractors, one (1) of which, at Tenant's option, shall be a contractor designated by Tenant (prior to the date Landlord submits its drawings for bids) and reasonably acceptable to Landlord. Landlord shall immediately thereafter deliver to Tenant copies of the bid packages received by Landlord from all of the bidders, together with an itemized budget showing a detailed breakdown by trade and contractor, unit costs and those additional costs associated with the modifications not located within the Premises but required as a result of the requested wall openings. Within five (5) business days from receipt of the bids by Tenant, Tenant shall direct deliver to Landlord whether a certificate of public liability and property damage insurance of a type and with the limits as shall be reasonably acceptable to accept or reject any Landlord, naming Landlord as additional insured, and evidence of Xxxxxxx’x Compensation and Builder’s Risk coverage in such amounts as are required by law and are acceptable to Landlord. From and after the date of delivery of possession of the bids. In the event Premises, (i) Tenant directs Landlord to accept any shall observe and perform all of the bidsits obligations under this Lease, Landlord shall arrange for the performance of such work, the Construction Payment shall be reduced by the amount of the lowest bid, together with Landlord's actual out-of-pocket cost to prepare the construction drawings (in an amount not to exceed $4,600), and the construction of such additional wall openings (including, including without limitation, payment of all utility charges, but excluding its obligations to pay Minimum Monthly Rent and additional rent, which are payable from and after the Commencement Date, (ii) any required structural modifications located within entry by Tenant or outside work performed by Tenant or any fixtures or personal property moved onto the Premises) Premises shall be deemed at Tenant's own risk, and (iii) neither Landlord nor Landlord's agents or contractors shall be responsible to be part Tenant for damage or destruction of Tenant's property unless such damage arises from the wrongful acts or omissions of Landlord's Work for all purposes of this Lease. In the event Landlord does not perform such work as aforesaid, the Construction Payment shall nevertheless be reduced by Landlord's actual out-of-pocket cost to prepare the construction drawingsits employees, in an amount not to exceed $4,600agents, consultants or contractors.

CONSTRUCTION OF THE PREMISES. 4.1 Landlord shall, at (a) Landlord's sole expense Work. Landlord shall complete the construction and installation of the alterations, installations, improvements and other work ("Landlord's Work") shown on the plans, working drawings and specifications identified on Exhibit B attached to this Lease (the "Plans"), in a good and workmanlike manner and in compliance with all applicable codes, laws, regulations and ordinances, perform the work set forth on EXHIBIT D annexed hereto ("LANDLORD'S WORK"). Within forty-five (45) days after the Effective Date, Tenant shall complete the preparation of plans and specifications for Tenant's finish-out work and all other work (including any work which is not the responsibility of Landlord as set forth in EXHIBIT D) necessary to prepare the Premises for Tenant's occupancy and deliver same to Landlord and Landlord's architect. Landlord shall, within five (5) business days after receipt of such plans and specifications, either approve or disapprove such plans and specifications. If Landlord disapproves same, Landlord's objections shall be stated with sufficient particularity to permit Tenant to revise said plans. The above procedure shall continue until Tenant's plans and specifications are approved by Landlord (such plans and specifications, as approved by Landlord, hereinafter referred to as "TENANT'S PLANS" and the work shown thereon hereinafter referred to as "TENANT'S WORK"). If Landlord fails to approve or disapprove Tenant's plans and specifications within the aforesaid five (5) business day period, such plans and specifications shall be deemed approved by Landlord. Landlord shall not unreasonably withhold its consent to Tenant's plans and specifications. Within the earlier to occur of (i) sixty (60) days after Landlord has approved Tenant's Plans or (ii) March 15, 1996 (the "PERMIT PERIOD"), Tenant shall use reasonably diligent reasonable efforts to obtain a building permit for Tenantcause Landlord's Work to be Substantially Complete by January 22, 2001, subject to any Tenant Delays (including all signage) and shall deliver Landlord notice upon its receipt thereof ("TENANT'S PERMIT NOTICE"as defined below). If Tenant fails to obtain a building permit for Tenantrequests any changes in Landlord's Work within the Permit Period, Tenant may, without liability or further obligation, terminate this Lease upon written notice to Landlord delivered within five (5) days after the expiration Date of the Permit Period, and this Lease shall have no further force or effect. If Tenant fails to terminate the Lease as aforesaid within five (5) days after expiration of the Permit PeriodLease, Tenant shall be deemed to have received a building permit submit such request in writing, and Tenant's right to terminate this Lease under this Paragraph shall cease. Notwithstanding the foregoingany such , if Tenant fails to obtain a building permit for Tenant's Work prior to the expiration of the Permit Period, Landlord change shall be entitled to extend the Permit Period by not more than thirty (30) days by notice to Tenant and obtain such permits on Tenant's behalf (Tenant being responsible for any municipal fees to obtain said permits) making only those changes to Tenant's Plans as are approved by Tenant and which are necessary to comply with applicable governmental codes and regulations. If Landlord obtains the permits necessary to complete Tenant's Work within sixty (60) days of expiration of the Permit Period, Tenant's option to terminate this Lease as provided in this paragraph 4.1 shall cease. 4.2 Provided Landlord has delivered the Contingency Satisfaction Notice to Tenant or such Contingency Satisfaction Notice is deemed delivered pursuant to Paragraph 37.14, Landlord shall obtain all necessary approvals, licensing and building permits for Landlord's Work and shall commence construction of Landlord's Work (collectively, "LANDLORD'S PRELIMINARY WORK") on or prior to the date ("LANDLORD'S WORK COMMENCEMENT DATE") which is ten (10) days from the earlier of (i) the date Landlord receives Tenant's Permit Notice or (ii) the date Landlord receives a written notice from Tenant that Tenant has waived its right under Paragraph 4.1 to terminate this Lease because of failure to obtain a building permit (the "PERMIT WAIVER NOTICE") (such notices referred to in clauses (i) and (ii) to be delivered no earlier than sixty (60) days after Lease execution). If Landlord fails to perform Landlord's Preliminary Work on or prior subject to Landlord's Work Commencement Date, Tenant may, without liability or further obligation, terminate this Lease upon ten (10) days prior written notice to Landlord, in which event this Lease shall terminate and shall have no further force or effect upon the expiration of such ten (10) day period, unless all necessary approvals, licensing and building permits for Landlord's Work have been obtained and Landlord's Work has commenced prior to the expiration of such ten (10) day period. 4.3 In the event Landlord fails to complete construction of the Landlord's Work and deliver the Premises to Tenant in accordance with Article 5 below within eighty (80) days from Landlord's Work Commencement Date (which date shall not be subject to delays permitted under Article 33) (the "OUTSIDE DATE"), Tenant may, without liability or further obligation, terminate this Lease upon thirty (30) days written notice to Landlord, in which event this Lease shall terminate and shall have no further force or effect upon the expiration of such thirty (30) day period, unless Landlord's Work has been completed prior to the expiration of such thirty (30) day period. 4.4 half (1/2) day's rent (calculated at a one-half of the daily rate based on a thirty day month) for each day such completion and delivery is delayed beyond the Outside Date. It is hereby agreed that the liquidated damages to which Tenant is entitled hereunder is a reasonable estimate of the damages to Tenant that would be caused by Landlord's delay in completing Landlord's Work and delivering the Premises. 4.5 Landlord hereby agrees to pay to Tenant a construction payment (the "CONSTRUCTION PAYMENT") in an amount equal to One Hundred Sixty-five Thousand and 00/100 Dollars ($165,000.00)approval, which Construction Payment is made not as an inducement to Tenant to enter into this Lease but to defray the cost of Tenant's Work. Landlord shall pay the Construction Payment within thirty (30) days after Tenant's Work has been completed, Tenant has obtained a certificate of occupancy for the Premises, Tenant has opened for business and Tenant has delivered lien waivers for all work performed or material supplied (except no lien waivers shall be required for any subcontractor whose work or materials does not exceed $3,000). Provided Tenant has complied with the above requirements, if Landlord fails to pay the Construction Payment within thirty (30) days after notice from Tenant that same is past due, Tenant shall have the right, in addition to any other rights or remedies available to Tenant hereunder, at law or in equity, to offset the amount owing from future installments of Fixed Rent and any additional charges payable by Tenant under the Lease until Tenant is reimbursed said Construction Payment in full, with interest on the remaining balance from the date such Construction Payment was due until so reimbursed to Tenant at the rate of ten percent (10%) per annum. 4.6 Attached hereto as EXHIBIT G are the design elevations and store fronts to be constructed by Tenant as part of Tenant's Work (the "ELEVATION DESIGNS"). Within sixty (60) days after the Effective Date, Landlord shall process and obtain the necessary discretionary approvals from the City of Chico (including the Architectural Review Board) for construction of said Elevation Designs (excluding building permits). Tenant shall give Landlord prior notice of any changes in the Elevation Designs and any material changes thereto shall not be made without the prior written consent of Landlord, which consent approval shall not be unreasonably withheld or delayed; provided, however, that Landlord may shall have the right to withhold its consent if such change shall result in a Tenant Delay. If Landlord approves any such material change, Landlord shall deliver to Tenant a written change (i) requires additional approvals from order describing such change and setting forth any increase or decrease in the City of Chico or delay the processing cost of Landlord's application for said approvals, (ii) requires structural modifications Work and any Tenant Delay resulting from such change. If Tenant fails to the building of which the Premises are a part, or (iii) affects the design or dimensions of the Blockbuster Video elevations or storefront. Notwithstanding the foregoing provisions of Paragraph 4.5 execute and this Paragraph 4.6, within thirty (30) days of the Effective Date, return to Landlord shall prepare construction drawings for the construction of additional wall openings on the west and south elevations of the Premises, as indicated on EXHIBIT G annexed hereto, including any structural modifications necessary to ensure the structural integrity of the building (whether or not such modifications are located within the Premises) and Tenant shall approve or disapprove such drawings change order within five (5) days of submission by Landlord and shall cooperate with Landlord to finally approve such drawings within five (5) days after the expiration of such fifteen (15) day preparation period. On or before the latest to occur of (i) ten (10) business days after Tenant's final approval of such drawings or (ii) March 1, 1996, Landlord shall obtain bid submissions for such additional wall openings, receiving it from at least three (3) contractors, one (1) of which, at Tenant's option, shall be a contractor designated by Tenant (prior to the date Landlord submits its drawings for bids) and reasonably acceptable to Landlord. Landlord shall immediately thereafter deliver to Tenant copies of the bid packages received by Landlord from all of the bidders, together with an itemized budget showing a detailed breakdown by trade and contractor, unit costs and those additional costs associated with the modifications not located within the Premises but required as a result of the requested wall openings. Within five (5) business days from receipt of the bids by Tenant, Tenant shall direct be deemed to have rescinded its request for such change. Landlord whether may condition its approval of any such change on Tenant's payment of any such increase in the cost of Landlord's Work at the time Tenant executes the change order for such change. (b) Landlord shall provide an allowance for construction of improvements to accept or reject any the Premises equal to the product of $8.00 and the number of rentable square feet in the Premises (the "Allowance") toward the entire cost of the bidsLandlord's Work ("Improvement Cost"). In the event the Improvement Cost exceeds the Allowance, Tenant directs shall reimburse to Landlord to accept any the balance of the bidsImprovement Cost. The Improvement Cost shall include Tenant's architectural space planning and permit costs, Landlord's architectural and design costs and all payments to the contractor that installs the Landlords Work.. Landlord and Tenant shall arrange each pay their proportionate share of each contractor's requisition for the performance of such workImprovement Cost, the Construction Payment shall be reduced by the amount based upon Landlord's then estimate of the lowest bid, together with Landlord's actual out-of-pocket cost to prepare the construction drawings (in an amount not to exceed $4,600), and the construction of such additional wall openings (including, without limitation, any required structural modifications located within or outside the Premises) shall be deemed to be part of Landlord's Work for all purposes of this Lease. In the event Landlord does not perform such work as aforesaid, the Construction Payment shall nevertheless be reduced by Landlord's actual out-of-pocket cost to prepare the construction drawings, in an amount not to exceed $4,600total Improvement Cost.

CONSTRUCTION OF THE PREMISES. 4.1 (a) Tenant acknowledges that it has inspected the Premises and is fully familiar with its condition and agrees to take same in its present “as-is” condition, subject only to the performance of the landlord’s Work and any other condition required for the delivery of the Premises to Tenant. The Landlord shallshall have no obligation to alter, at Landlord's sole expense and in compliance with all applicable codes, laws, regulations and ordinances, perform the work set forth on EXHIBIT D annexed hereto ("LANDLORD'S WORK"). Within forty-five (45) days after the Effective Date, Tenant shall complete the preparation of plans and specifications for Tenant's finish-out work and all other work (including repair or otherwise make any work which is not the responsibility of Landlord as set forth in EXHIBIT D) necessary changes to prepare the Premises for Tenant's ’s occupancy and deliver same to Landlord and Landlord's architect. Landlord shall, within five (5) business days after receipt of such plans and specifications, either approve or disapprove such plans and specifications. If Landlord disapproves same, Landlord's objections shall be stated with sufficient particularity to permit Tenant to revise said plans. The above procedure shall continue until Tenant's plans and specifications are approved by Landlord (such plans and specifications, as approved by Landlord, hereinafter referred to as "TENANT'S PLANS" and the work shown thereon hereinafter referred to as "TENANT'S WORK"). If Landlord fails to approve or disapprove Tenant's plans and specifications within the aforesaid five (5) business day period, such plans and specifications shall be deemed approved by Landlord. Landlord shall not unreasonably withhold its consent to Tenant's plans and specifications. Within the earlier to occur of (i) sixty (60) days after Landlord has approved Tenant's Plans or (ii) March 15, 1996 (the "PERMIT PERIOD"), Tenant shall use reasonably diligent efforts to obtain a building permit for Tenant's Work (including all signage) and shall deliver Landlord notice upon its receipt thereof ("TENANT'S PERMIT NOTICE"). If Tenant fails to obtain a building permit for Tenant's Work within the Permit Period, Tenant may, without liability or further obligation, terminate this Lease upon written notice to Landlord delivered within five (5) days after the expiration of the Permit PeriodPremises, and this Lease shall have no further force or effect. If Tenant fails to terminate other than the Lease as aforesaid within five (5) days after expiration of the Permit Period, Tenant shall be deemed to have received a building permit and Tenant's right to terminate this Lease under this Paragraph shall cease. Notwithstanding the foregoing, if Tenant fails to obtain a building permit for Tenant's Work prior to the expiration of the Permit Period, Landlord shall be entitled to extend the Permit Period by not more than thirty (30) days by notice to Tenant and obtain such permits on Tenant's behalf (Tenant being responsible for any municipal fees to obtain said permits) making only those changes to Tenant's Plans as are approved by Tenant and which are necessary to comply with applicable governmental codes and regulations. If Landlord obtains the permits necessary to complete Tenant's Work within sixty (60) days of expiration of the Permit Period, Tenant's option to terminate this Lease as provided in this paragraph 4.1 shall cease. 4.2 Provided Landlord has delivered the Contingency Satisfaction Notice to Tenant or such Contingency Satisfaction Notice is deemed delivered pursuant to Paragraph 37.14, Landlord shall obtain all necessary approvals, licensing and building permits for Landlord's Work and shall commence construction of Landlord's Work (collectively, "LANDLORD'S PRELIMINARY WORK") on or prior to the date ("LANDLORD'S WORK COMMENCEMENT DATE") which is ten (10) days from the earlier of (i) the date Landlord receives Tenant's Permit Notice or (ii) the date Landlord receives a written notice from Tenant that Tenant has waived its right under Paragraph 4.1 to terminate this Lease because of failure to obtain a building permit (the "PERMIT WAIVER NOTICE") (such notices referred to in clauses (i) and (ii) to be delivered no earlier than sixty (60) days after Lease execution). If Landlord fails to perform Landlord's Preliminary Work on or prior to Landlord's Work Commencement Date, Tenant may, without liability or further obligation, terminate this Lease upon ten (10) days written notice to Landlord, in which event this Lease shall terminate and shall have no further force or effect upon the expiration of such ten (10) day period, unless all necessary approvals, licensing and building permits for Landlord's Work have been obtained and Landlord's Work has commenced prior to the expiration of such ten (10) day period. 4.3 In the event Landlord fails to complete construction performance of the Landlord's Work and deliver ’s Work. (b) Tenant shall permit no mechanic’s, materialman’s or any other lien to be placed or filed against the Premises Building with respect to any work performed by or on behalf of Tenant in accordance with Article 5 below within eighty (80) days from Landlord's Work Commencement Date (which date shall not be subject to delays permitted under Article 33) (the "OUTSIDE DATE"), Tenant may, without liability or further obligation, terminate this Lease upon thirty (30) days written notice to Landlord, in which event this Lease shall terminate and shall have no further force or effect upon the expiration of such thirty (30) day period, unless Landlord's Work has been completed prior to the expiration of such thirty (30) day period. 4.4 half (1/2) day's rent (calculated at a one-half of the daily rate based on a thirty day month) for each day such completion and delivery is delayed beyond the Outside Date. It is hereby agreed that the liquidated damages to which Tenant is entitled hereunder is a reasonable estimate of the damages to Tenant that would be caused by Landlord's delay in completing Landlord's Work and delivering the Premises. 4.5 Landlord hereby agrees . Failure to pay to Tenant a construction payment (the "CONSTRUCTION PAYMENT") in an amount equal to One Hundred Sixty-five Thousand and 00/100 Dollars ($165,000.00), which Construction Payment is made not as an inducement to Tenant to enter into this Lease but to defray the cost of Tenant's Work. Landlord shall pay the Construction Payment within thirty (30) days after Tenant's Work has been completed, Tenant has obtained a certificate of occupancy for the Premises, Tenant has opened for business and Tenant has delivered lien waivers for all work performed discharge or material supplied (except no lien waivers shall be required for any subcontractor whose work or materials does not exceed $3,000). Provided Tenant has complied with the above requirements, if Landlord fails to pay the Construction Payment within thirty (30) days after notice from Tenant that same is past due, Tenant shall have the right, in addition to any other rights or remedies available to Tenant hereunder, at law or in equity, to offset the amount owing from future installments of Fixed Rent and any additional charges payable by Tenant under the Lease until Tenant is reimbursed said Construction Payment in full, with interest on the remaining balance from the date such Construction Payment was due until so reimbursed to Tenant at the rate of ten percent (10%) per annum. 4.6 Attached hereto as EXHIBIT G are the design elevations and store fronts to be constructed by Tenant as part of Tenant's Work (the "ELEVATION DESIGNS"). Within sixty (60) days after the Effective Date, Landlord shall process and obtain the necessary discretionary approvals from the City of Chico (including the Architectural Review Board) for construction of said Elevation Designs (excluding building permits). Tenant shall give Landlord prior notice of any changes in the Elevation Designs and any material changes thereto shall not be made without the prior written consent of Landlord, which consent shall not be unreasonably withheld or delayed; provided, however, Landlord may withhold its consent if bond any such material change (i) requires additional approvals from the City of Chico or delay the processing of Landlord's application for said approvals, (ii) requires structural modifications to the building of which the Premises are a part, or (iii) affects the design or dimensions of the Blockbuster Video elevations or storefront. Notwithstanding the foregoing provisions of Paragraph 4.5 and this Paragraph 4.6lien, within thirty (30) days of days’ after written notice from Landlord shall be deemed a material default under this Lease. (c) Notwithstanding anything to the Effective Datecontrary in this Lease, Landlord shall prepare construction drawings for not be required to consent to the performance of any work or installations by Tenant which would: (i) require changes to structural components of the Building or the exterior design of the Building; (ii) adversely affect the Building’s Systems or installations outside the Premises; (iii) not comply with all applicable Legal Requirements of any Government Entity having jurisdiction over the construction of additional wall openings on the west and south elevations Building and/or the Premises; and/or (iv) be incompatible with plans previously filed for the Building with the Department of Buildings of the City of New York or with the occupancy of the Building as a first-class office building. (d) Landlord hereby approves Tenant using Improcom Inc., Atlantic Metro Communications and/or Rainbow Broadband for installation of computer and/or telecommunication equipment and/or the provision of internet access and/or telecommunication services. (e) Notwithstanding anything to the contrary contained in the Lease, Tenant shall be obligated to comply with the requirements of any handicapped laws applicable to the Premises, as indicated including without limitation, the so-called Americans with Disabilities Act of 1990 and the regulations promulgated thereunder, provided, however, that Landlord shall be responsible to comply with such laws with respect to the Landlord’s Work and the Premises shall comply with such laws on EXHIBIT G annexed heretothe Commencement Date. Tenant at its sole cost and expense shall be obligated to install and connect the fire safety systems servicing the Premises with the Building’s Class E system located at the Premises with respect to any work performed by Tenant in the Premises; provided, including any structural modifications necessary however, that Landlord shall be responsible for such work with respect to ensure the structural integrity performance and completion of the building (whether or not such modifications are located within the Premises) and Tenant shall approve or disapprove such drawings within five (5) days of submission Landlord’s Work. If required by Landlord and shall cooperate with Landlord to finally approve such drawings within five (5) days after the expiration of such fifteen (15) day preparation period. On or before the latest to occur of (i) ten (10) business days after Tenant's final approval of such drawings or (ii) March 1, 1996applicable laws, Landlord shall obtain bid submissions for such additional wall openings, from at least three (3) contractors, one (1) of which, at Tenant's option, shall be install a contractor designated by Tenant (prior to the date Landlord submits its drawings for bids) and reasonably acceptable to Landlord. Landlord shall immediately thereafter deliver to Tenant copies of the bid packages received by Landlord from all of the bidders, together with an itemized budget showing a detailed breakdown by trade and contractor, unit costs and those additional costs associated with the modifications not located within sprinkler system in the Premises but required as a result of the requested wall openings. Within five (5) at Landlord’s cost and shall use its reasonable commercial efforts to minimize any interference with Tenant’s business days from receipt of the bids by Tenant, Tenant shall direct Landlord whether to accept or reject operations during any of the bids. In the event Tenant directs Landlord to accept any of the bids, Landlord shall arrange for the performance of such work, the Construction Payment and such work shall be reduced performed by the amount of the lowest bid, together with Landlord's actual out-of-pocket cost to prepare the construction drawings (in an amount not to exceed $4,600), and the construction of such additional wall openings (including, without limitation, any required structural modifications located within or outside the Premises) shall be deemed to be part of Landlord's Work for all purposes of this Lease. In the event Landlord does not perform such work as aforesaid, the Construction Payment shall nevertheless be reduced by Landlord's actual out-of-pocket cost to prepare the construction drawings, in an amount not to exceed $4,600at times other than normal business hours.

CONSTRUCTION OF THE PREMISES. 4.1 Landlord shall, at its expense, install the initial improvements specified in the Plans to be prepared by Landlord in accordance with Section 4.2 of the Lease ("Landlord's sole expense and in compliance with all applicable codes, laws, regulations and ordinances, perform the work set forth on EXHIBIT D annexed hereto ("LANDLORD'S WORKWork"). Within forty-five (45) days after the Effective Date, Tenant shall complete the preparation of plans and specifications for Tenant's finish-out work and all other work (including any work which is not the responsibility of Landlord as set forth in EXHIBIT D) necessary to prepare the Premises for Tenant's occupancy and deliver same to Landlord and Landlord's architect. Landlord shall, within five (5) business days after receipt of such plans and specifications, either approve or disapprove such plans and specifications. If Landlord disapproves same, Landlord's objections shall be stated with sufficient particularity to permit Tenant to revise said plans. The above procedure shall continue until Tenant's plans and specifications are approved by Landlord (such plans and specifications, as approved by Landlord, hereinafter referred to as "TENANT'S PLANS" and the work shown thereon hereinafter referred to as "TENANT'S WORK"). If Landlord fails to approve or disapprove Tenant's plans and specifications within the aforesaid five (5) business day period, such plans and specifications shall be deemed approved by Landlord. Landlord shall not unreasonably withhold its consent be obligated to provide any improvements, other than Landlord's Work. The Landlord's Work expressly excludes any work related to any Tenant's plans furniture, computers, communication and specifications. Within the earlier to occur of (i) sixty (60) days after Landlord has approved Tenant's Plans or (ii) March 15, 1996 (the "PERMIT PERIOD"), Tenant shall use reasonably diligent efforts to obtain a building permit for Tenant's Work (including other business equipment and/or wiring and all signage) other personal property and shall deliver Landlord notice upon its receipt thereof ("TENANT'S PERMIT NOTICE"). If Tenant fails to obtain a building permit for Tenant's Work within the Permit Period, Tenant may, without liability or further obligation, terminate this Lease upon written notice to Landlord delivered within five (5) days after the expiration of the Permit Period, and this Lease shall have no further force or effect. If Tenant fails to terminate the Lease as aforesaid within five (5) days after expiration of the Permit Period, Tenant shall be deemed to have received a building permit and Tenant's right to terminate this Lease under this Paragraph shall ceasetrade fixtures. Notwithstanding the foregoing, if Tenant fails to obtain a building permit requests that Landlord perform additional items of work which are not specified in the Plans, and if Landlord approves such request, Tenant shall pay for Tenant's Work prior to the expiration all costs associated therewith as provided for in Section E hereto. Promptly upon completion of the Permit Periodrevised Plans, Landlord shall notify Tenant in writing of the increased cost in the Landlord's Work, if any, resulting from such additional items of work. Tenant, within one (1) Business Day, shall notify Landlord in writing, whether it desires to proceed with such revisions. In the absence of such written authorization, Landlord shall have the option to continue work on the Premises disregarding the requested revision. Tenant shall be entitled to extend the Permit Period by not more than thirty (30) days by notice to Tenant and obtain such permits on Tenant's behalf (Tenant being responsible for any municipal fees delay in completion of the Premises resulting from any such revisions. Notwithstanding anything herein to obtain said permits) making only those changes the contrary, all revisions to Tenant's Plans as are approved this Exhibit F shall be subject to the approval of LANDLORD. All amounts payable by Tenant pursuant to this Exhibit F shall be considered additional rent and which are necessary subject to comply with all applicable governmental codes and regulations. If Landlord obtains the permits necessary to complete Tenant's Work within sixty (60) days of expiration provisions of the Permit PeriodLease. Notwithstanding the foregoing, Tenant's option to terminate this Lease except as otherwise expressly provided in this paragraph 4.1 shall cease. 4.2 Provided Landlord has delivered the Contingency Satisfaction Notice to Tenant or such Contingency Satisfaction Notice is deemed delivered pursuant to Paragraph 37.14herein, Landlord shall obtain all necessary approvals, licensing and building permits for Landlord's Work and shall commence construction of Landlord's Work (collectively, "LANDLORD'S PRELIMINARY WORK") on or prior not be required to the date ("LANDLORD'S WORK COMMENCEMENT DATE") perform work which is ten (10) days from the earlier of would (i) require changes to structural components or the date Landlord receives Tenant's Permit Notice or (ii) the date Landlord receives a written notice from Tenant that Tenant has waived its right under Paragraph 4.1 to terminate this Lease because of failure to obtain a building permit (the "PERMIT WAIVER NOTICE") (such notices referred to in clauses (i) and (ii) to be delivered no earlier than sixty (60) days after Lease execution). If Landlord fails to perform Landlord's Preliminary Work on or prior to Landlord's Work Commencement Date, Tenant may, without liability or further obligation, terminate this Lease upon ten (10) days written notice to Landlord, in which event this Lease shall terminate and shall have no further force or effect upon the expiration of such ten (10) day period, unless all necessary approvals, licensing and building permits for Landlord's Work have been obtained and Landlord's Work has commenced prior to the expiration of such ten (10) day period. 4.3 In the event Landlord fails to complete construction exterior design of the Landlord's Work and deliver the Premises to Tenant in accordance with Article 5 below within eighty (80) days from Landlord's Work Commencement Date (which date shall not be subject to delays permitted under Article 33) (the "OUTSIDE DATE"), Tenant may, without liability or further obligation, terminate this Lease upon thirty (30) days written notice to Landlord, in which event this Lease shall terminate and shall have no further force or effect upon the expiration of such thirty (30) day period, unless Landlord's Work has been completed prior to the expiration of such thirty (30) day period. 4.4 half (1/2) day's rent (calculated at a one-half of the daily rate based on a thirty day month) for each day such completion and delivery is delayed beyond the Outside Date. It is hereby agreed that the liquidated damages to which Tenant is entitled hereunder is a reasonable estimate of the damages to Tenant that would be caused by Landlord's delay in completing Landlord's Work and delivering the Premises. 4.5 Landlord hereby agrees to pay to Tenant a construction payment (the "CONSTRUCTION PAYMENT") in an amount equal to One Hundred Sixty-five Thousand and 00/100 Dollars ($165,000.00), which Construction Payment is made not as an inducement to Tenant to enter into this Lease but to defray the cost of Tenant's Work. Landlord shall pay the Construction Payment within thirty (30) days after Tenant's Work has been completed, Tenant has obtained a certificate of occupancy for the Premises, Tenant has opened for business and Tenant has delivered lien waivers for all work performed or material supplied (except no lien waivers shall be required for any subcontractor whose work or materials does not exceed $3,000). Provided Tenant has complied with the above requirements, if Landlord fails to pay the Construction Payment within thirty (30) days after notice from Tenant that same is past due, Tenant shall have the right, in addition to any other rights or remedies available to Tenant hereunder, at law or in equity, to offset the amount owing from future installments of Fixed Rent and any additional charges payable by Tenant under the Lease until Tenant is reimbursed said Construction Payment in full, with interest on the remaining balance from the date such Construction Payment was due until so reimbursed to Tenant at the rate of ten percent (10%) per annum. 4.6 Attached hereto as EXHIBIT G are the design elevations and store fronts to be constructed by Tenant as part of Tenant's Work (the "ELEVATION DESIGNS"). Within sixty (60) days after the Effective Date, Landlord shall process and obtain the necessary discretionary approvals from the City of Chico (including the Architectural Review Board) for construction of said Elevation Designs (excluding building permits). Tenant shall give Landlord prior notice of any changes in the Elevation Designs and any material changes thereto shall not be made without the prior written consent of Landlord, which consent shall not be unreasonably withheld or delayed; provided, however, Landlord may withhold its consent if any such material change (i) requires additional approvals from the City of Chico or delay the processing of Landlord's application for said approvalsBuilding, (ii) requires structural modifications require any material modification to the Building's mechanical installations or installations outside the Premises, (iii) not comply with all Laws, (iv) be incompatible with the building plans filed with appropriate governmental authorities or with the occupancy of which the Premises are Building as a partfirst-class office building, or (iiiv) affects delay the design or dimensions completion of any other work in the Blockbuster Video elevations or storefrontBuilding. Notwithstanding the foregoing provisions of Paragraph 4.5 and this Paragraph 4.6, within thirty (30) days of the Effective Date, Landlord shall prepare construction drawings for Any changes required by any government department affecting the construction of additional wall openings on the west and south elevations of the Premises, as indicated on EXHIBIT G annexed hereto, including any structural modifications necessary to ensure the structural integrity of the building (whether Building or not such modifications are located within the Premises) and Tenant shall approve or disapprove such drawings within five (5) days of submission by Landlord and shall cooperate with Landlord to finally approve such drawings within five (5) days after the expiration of such fifteen (15) day preparation period. On or before the latest to occur of (i) ten (10) business days after Tenant's final approval of such drawings or (ii) March 1, 1996, Landlord shall obtain bid submissions for such additional wall openings, from at least three (3) contractors, one (1) of which, at Tenant's option, shall be a contractor designated by Tenant (prior to the date Landlord submits its drawings for bids) and reasonably acceptable to Landlord. Landlord shall immediately thereafter deliver to Tenant copies of the bid packages received by Landlord from all of the bidders, together with an itemized budget showing a detailed breakdown by trade and contractor, unit costs and those additional costs associated with the modifications not located within the Premises but required as a result of the requested wall openings. Within five (5) business days from receipt of the bids by Tenant, Tenant shall direct Landlord whether to accept or reject any of the bids. In the event Tenant directs Landlord to accept any of the bids, Landlord shall arrange for the performance of such work, the Construction Payment shall be reduced by the amount of the lowest bid, together with Landlord's actual out-of-pocket cost to prepare the construction drawings (in an amount not to exceed $4,600), and the construction of such additional wall openings (including, without limitation, any required structural modifications located within or outside the Premises) shall be deemed to be part of Landlord's Work for all purposes violate any plans or provisions of this Lease. In the event Landlord does not perform such work as aforesaidExhibit F, the Construction Payment and shall nevertheless be reduced accepted by Landlord's actual out-of-pocket cost to prepare the construction drawings, in an amount not to exceed $4,600Tenant.

CONSTRUCTION OF THE PREMISES. 4.1 The Premises are comprised of Buildings 307 and 308 and the Connector between the Buildings. Tenant desires, and Landlord shallhas agreed, at to construct improvements (the “Improvements”) to the exterior and interior of the Premises to meet the needs of Tenant’s business operations. Landlord will construct the Connector and the Improvements in accordance with construction plans (the “Construction Plans”) to be prepared by Landlord's sole expense ’s architects and in compliance engineers. The Construction Plans for Building 307 will be submitted to Tenant for review and approval within ten (10) days of execution hereof and Tenant shall respond to Landlord with all applicable codes, laws, regulations comments within five (5) days of receipt. Both Landlord and ordinances, perform Tenant must approve the work set forth on EXHIBIT D annexed hereto Construction Plans within twenty ("LANDLORD'S WORK")20) days of execution hereof. Within forty-five (45) days after of the Effective Dateexecution of the Lease, Landlord will deliver to Tenant the Construction Plans for Building 308 and the Connector. Tenant shall complete have ten (10) days to review and comment on the preparation of plans Construction Plans for Building 308 and specifications for Tenant's finish-out work and all other work (including any work which is not the responsibility of Landlord as set forth in EXHIBIT D) necessary to prepare the Premises for Tenant's occupancy and deliver same to Landlord and Landlord's architect. Landlord shall, within five (5) business days after receipt of such plans and specifications, either approve or disapprove such plans and specifications. If Landlord disapproves same, Landlord's objections shall be stated with sufficient particularity to permit Tenant to revise said plansConnector. The above procedure shall continue until Tenant's plans and specifications are approved by Landlord (such plans and specifications, as approved by Landlord, hereinafter referred to as "TENANT'S PLANS" parties must agree on the Building 308 and the work shown thereon hereinafter referred to as "TENANT'S WORK"). If Landlord fails to approve or disapprove Tenant's plans and specifications within the aforesaid five (5) business day period, such plans and specifications shall be deemed approved by Landlord. Landlord shall not unreasonably withhold its consent to Tenant's plans and specifications. Within the earlier to occur of (i) sixty (60) days after Landlord has approved Tenant's Connector Construction Plans or (ii) March 15, 1996 (the "PERMIT PERIOD"), Tenant shall use reasonably diligent efforts to obtain a building permit for Tenant's Work (including all signage) and shall deliver Landlord notice upon its receipt thereof ("TENANT'S PERMIT NOTICE"). If Tenant fails to obtain a building permit for Tenant's Work within the Permit Period, Tenant may, without liability or further obligation, terminate this Lease upon written notice to Landlord delivered within five (5) days after the expiration of the Permit Period, and this Lease shall have no further force or effect. If Tenant fails to terminate the Lease as aforesaid within five (5) days after expiration of the Permit Period, Tenant shall be deemed to have received a building permit and Tenant's right to terminate this Lease under this Paragraph shall cease. Notwithstanding the foregoing, if Tenant fails to obtain a building permit for Tenant's Work prior to the expiration of the Permit Period, Landlord shall be entitled to extend the Permit Period by not more than thirty (30) days by notice to Tenant and obtain such permits on Tenant's behalf (Tenant being responsible for any municipal fees to obtain said permits) making only those changes to Tenant's Plans as are approved by Tenant and which are necessary to comply with applicable governmental codes and regulations. If Landlord obtains the permits necessary to complete Tenant's Work within sixty (60) days of expiration execution of the Permit PeriodLease. Upon approval, Tenant's option the Construction Plans for Xxxxxxxx 000, Xxxxxxxx 000, and the Connector will be attached to terminate this the Lease as provided an exhibit and incorporated herein by reference. Landlord and Tenant will work in this paragraph 4.1 shall cease. 4.2 Provided good faith to agree on the Construction Plans for all the Buildings. Interior Improvements: Landlord has delivered the Contingency Satisfaction Notice to Tenant or such Contingency Satisfaction Notice is deemed delivered pursuant to Paragraph 37.14, Landlord shall obtain all necessary approvals, licensing and building permits for Landlord's Work and shall commence construction of Landlord's Work (collectively, "LANDLORD'S PRELIMINARY WORK") on or prior to the date ("LANDLORD'S WORK COMMENCEMENT DATE") which is ten (10) days from the earlier of (i) the date Landlord receives Tenant's Permit Notice or (ii) the date Landlord receives a written notice from Tenant that Tenant has waived its right under Paragraph 4.1 to terminate this Lease because of failure to obtain a building permit (the "PERMIT WAIVER NOTICE") (such notices referred to in clauses (i) and (ii) to be delivered no earlier than sixty (60) days after Lease execution). If Landlord fails to perform Landlord's Preliminary Work on or prior to Landlord's Work Commencement Date, Tenant may, without liability or further obligation, terminate this Lease upon ten (10) days written notice to Landlord, in which event this Lease shall terminate and shall have no further force or effect upon the expiration of such ten (10) day period, unless all necessary approvals, licensing and building permits for Landlord's Work have been obtained and Landlord's Work has commenced prior to the expiration of such ten (10) day period. 4.3 In the event Landlord fails to complete construction of the Landlord's Work and deliver the Premises to Tenant in accordance with Article 5 below within eighty (80) days from Landlord's Work Commencement Date (which date shall not be subject to delays permitted under Article 33) (the "OUTSIDE DATE"), Tenant may, without liability or further obligation, terminate this Lease upon thirty (30) days written notice to Landlord, in which event this Lease shall terminate and shall have no further force or effect upon the expiration of such thirty (30) day period, unless Landlord's Work has been completed prior to the expiration of such thirty (30) day period. 4.4 half (1/2) day's rent (calculated at a one-half of the daily rate based on a thirty day month) for each day such completion and delivery is delayed beyond the Outside Date. It is hereby agreed that the liquidated damages to which Tenant is entitled hereunder is a reasonable estimate of the damages to Tenant that would be caused by Landlord's delay in completing Landlord's Work and delivering the Premises. 4.5 Landlord hereby agrees to pay will provide to Tenant a construction payment allowance not to exceed thirty dollars ($30) per square foot of the Premises (85,000 square feet) (the "CONSTRUCTION PAYMENT"“Interior Fit-Up Allowance”) for the construction of the interior Improvements. Landlord will construct the interior Improvements in an amount equal to One Hundred Sixty-five Thousand and 00/100 Dollars ($165,000.00), which accordance with the Construction Payment is made not as an inducement to Tenant to enter into this Lease but to defray Plans. If the cost of Tenant's Work. Landlord shall pay the Construction Payment within thirty (30) days after Tenant's Work has been completedinterior Improvements exceeds the Interior Fit-Up Allowance, Tenant has obtained a certificate of occupancy for the Premises, Tenant has opened for business and Tenant has delivered lien waivers for all work performed or material supplied (except no lien waivers excess shall be required at Tenant’s sole expense. Upon completion of the interior Improvements for any subcontractor whose work or materials does not exceed $3,000). Provided Tenant has complied with the above requirementseach Building and prior to occupancy of each Building, if Landlord fails to pay there is any excess costs over the Construction Payment within thirty (30) days after notice from Tenant that same is past dueInterior Fit-Up Allowance, Tenant shall have reimburse Landlord in current funds for Landlord’s expenses of every kind and nature in connection with construction of the rightinterior Improvements, including, but not limited to, all amounts paid by Landlord to the general contractor for materials, labor, and services, plus overhead and profit of sixteen percent (16%). In the event that the total cost of the interior Improvements is less than the Interior Fit-Up Allowance, the difference shall be applied to Tenant’s monthly Base Rent under the Lease. Prior to commencement of construction of the interior Improvements for each Building, Landlord will submit to Tenant a breakdown of the construction costs. Within five (5) days of receipt of the breakdown, Tenant may review, in addition to any other rights or remedies available to Tenant hereunderLandlord’s offices, at law or in equity, to offset the amount owing from future installments of Fixed Rent and any additional charges payable by Tenant under the Lease until Tenant is reimbursed said Construction Payment in full, with interest on the remaining balance from the date such Construction Payment was due until so reimbursed to Tenant at the rate of ten percent (10%) per annum. 4.6 Attached hereto as EXHIBIT G are the design elevations and store fronts to be constructed by Tenant as part of Tenant's Work (the "ELEVATION DESIGNS")Landlord’s supporting documentation. Within sixty (60) days after the Effective Date, Landlord shall process and obtain the necessary discretionary approvals from the City of Chico (including the Architectural Review Board) for construction of said Elevation Designs (excluding building permits). Tenant shall give Landlord prior notice of any changes in the Elevation Designs and any material changes thereto shall not be made without the prior written consent of Landlord, which consent shall not be unreasonably withheld or delayed; provided, however, Landlord may withhold its consent if any such material change (i) requires additional approvals from the City of Chico or delay the processing of Landlord's application for said approvals, (ii) requires structural modifications to the building of which the Premises are a part, or (iii) affects the design or dimensions The final cost of the Blockbuster Video elevations or storefront. Notwithstanding the foregoing provisions of Paragraph 4.5 interior Improvements for Building 307 must be agreed upon between Landlord and this Paragraph 4.6, Tenant within thirty (30) days of the Effective Date, Landlord shall prepare construction drawings for the construction of additional wall openings on the west and south elevations full execution hereof. The final cost of the Premises, as indicated on EXHIBIT G annexed hereto, including any structural modifications necessary to ensure interior Improvements for Building 308 and the structural integrity of the building Connector must be agreed upon within sixty (whether or not such modifications are located within the Premises) and Tenant shall approve or disapprove such drawings within five (560) days of submission by execution hereof. Exterior Improvements: Landlord and shall cooperate with Landlord to finally approve such drawings within five (5) days after will construct the expiration of such fifteen (15) day preparation period. On or before the latest to occur of (i) ten (10) business days after Tenant's final approval of such drawings or (ii) March 1, 1996, Landlord shall obtain bid submissions for such additional wall openings, from at least three (3) contractors, one (1) of which, at Tenant's option, shall be a contractor designated by Tenant (prior following Improvements to the date Landlord submits its drawings for bids) and reasonably acceptable to Landlord. Landlord shall immediately thereafter deliver to Tenant copies exterior of the bid packages received by Landlord from Buildings as shown on the Construction Plans: (a) install edge levelers on four (4) existing docks; (b) replace all other existing dock overhead doors with windows; (c) install “spandrel glass” on the exterior ends of the bidders, together with an itemized budget showing a detailed breakdown by trade Buildings and contractor, unit costs and those additional costs associated with the modifications not located within the Premises but required as a result side of the requested wall openings. Within five Connector facing Xxxxxx Boulevard; (5d) business days from receipt construct the “special entry feature”; and (e) construct two outside break areas (each with one thousand (1,000) square feet of the bids by Tenant, Tenant shall direct Landlord whether to accept or reject any concrete pad and two hundred (200) square feet of the bids. In the event Tenant directs Landlord to accept any of the bids, Landlord shall arrange for the performance of such work, the Construction Payment shall be reduced by the amount of the lowest bid, together with Landlord's actual out-of-pocket cost to prepare the construction drawings (in an amount not to exceed $4,600), and the construction of such additional wall openings (including, without limitation, any required structural modifications located within or outside the Premises) shall be deemed to be part of Landlord's Work for all purposes of this Lease. In the event Landlord does not perform such work as aforesaid, the Construction Payment shall nevertheless be reduced by Landlord's actual out-of-pocket cost to prepare the construction drawings, in an amount not to exceed $4,600awning.

CONSTRUCTION OF THE PREMISES. 4.1 10.1 Landlord shallshall construct Tenant's Leasehold Improvements, at Landlord's sole expense and as defined in compliance Exhibit B, in accordance with all applicable codes, laws, regulations and ordinances, perform the work set forth on EXHIBIT D annexed hereto ("LANDLORD'S WORK"). Within forty-five (45) days after the Effective Date, Tenant shall complete the preparation of plans and specifications for Tenantprepared by Landlord's finish-out work --------- architect. The respective obligations and all other work (including any work which is not the responsibility covenants of Landlord as and Tenant with respect to construction of the Leasehold Improvements, including the division of responsibilities and procedures for design and construction and for payment of costs and expenses, are more specifically set forth in EXHIBIT D) necessary to prepare the Premises for Tenant's occupancy and deliver same to Landlord and Landlord's architect. Landlord shall, within five (5) business days after receipt of such plans and specifications, either approve or disapprove such plans and specifications. If Landlord disapproves same, Landlord's objections shall be stated with sufficient particularity to permit Tenant to revise said plans. The above procedure shall continue until Tenant's plans and specifications are approved by Landlord (such plans and specifications, as approved by Landlord, hereinafter referred to as "TENANT'S PLANS" and the work shown thereon hereinafter referred to as "TENANT'S WORK"). If Landlord fails to approve or disapprove Tenant's plans and specifications within the aforesaid five (5) business day period, such plans and specifications shall be deemed approved by Landlord. Landlord shall not unreasonably withhold its consent to Tenant's plans and specifications. Within the earlier to occur of (i) sixty (60) days after Landlord has approved Tenant's Plans or (ii) March 15, 1996 (the "PERMIT PERIOD"), Tenant shall use reasonably diligent efforts to obtain a building permit for Tenant's Work (including all signage) and shall deliver Landlord notice upon its receipt thereof ("TENANT'S PERMIT NOTICE"). If Tenant fails to obtain a building permit for Tenant's Work within the Permit Period, Tenant may, without liability or further obligation, terminate this Lease upon written notice to Landlord delivered within five (5) days after the expiration of the Permit Period, and this Lease shall have no further force or effect. If Tenant fails to terminate the Lease as aforesaid within five (5) days after expiration of the Permit Period, Tenant shall be deemed to have received a building permit and Tenant's right to terminate this Lease under this Paragraph shall cease. Notwithstanding the foregoing, if Tenant fails to obtain a building permit for Tenant's Work prior Exhibit B. --------- 10.2 Prior to the expiration of the Permit Period, Landlord shall be entitled to extend the Permit Period by not more than thirty (30) days by notice to Tenant and obtain such permits on Tenant's behalf (Tenant being responsible for any municipal fees to obtain said permits) making only those changes to Tenant's Plans as are approved by Tenant and which are necessary to comply with applicable governmental codes and regulations. If Landlord obtains the permits necessary to complete Tenant's Work within sixty (60) days of expiration of the Permit Period, Tenant's option to terminate this Lease as provided in this paragraph 4.1 shall cease. 4.2 Provided Landlord has delivered the Contingency Satisfaction Notice to Tenant or such Contingency Satisfaction Notice is deemed delivered pursuant to Paragraph 37.14, Landlord shall obtain all necessary approvals, licensing and building permits for Landlord's Work and shall commence construction of Landlord's Work (collectively, "LANDLORD'S PRELIMINARY WORK") on or prior to the date ("LANDLORD'S WORK COMMENCEMENT DATE") which is ten (10) days from the earlier of (i) the date Landlord receives Tenant's Permit Notice or (ii) the date Landlord receives a written notice from Tenant that Tenant has waived its right under Paragraph 4.1 to terminate this Lease because of failure to obtain a building permit (the "PERMIT WAIVER NOTICE") (such notices referred to in clauses (i) and (ii) to be delivered no earlier than sixty (60) days after Lease execution). If Landlord fails to perform Landlord's Preliminary Work on or prior to Landlord's Work Commencement Date, any work performed by Tenant may(which Tenant may do only if and to the extent provided for in Exhibit B and in full --------- compliance therewith), without liability or further obligation, terminate this Lease upon ten any fixtures or personal property moved onto the Premises (10) days written notice to which Tenant may do only with Landlord, in which event this Lease shall terminate 's prior consent and shall have no further force or effect upon the expiration satisfaction of such ten (10) day periodrequirements as Landlord may impose), unless all necessary approvals, licensing shall be at Tenant's own risk and building permits for neither Landlord nor Landlord's Work have been obtained and Landlord's Work has commenced prior to the expiration of such ten (10) day period. 4.3 In the event Landlord fails to complete construction of the Landlord's Work and deliver the Premises agents or contractors shall be responsible to Tenant in accordance with Article 5 below within eighty (80) days from Landlordfor damage or destruction of Tenant's Work Commencement Date (which date shall not be subject to delays permitted under Article 33) (the "OUTSIDE DATE")work or property, Tenant may, including without liability limitation damage or further obligation, terminate this Lease upon thirty (30) days written notice to Landlord, in which event this Lease shall terminate and shall have no further force or effect upon the expiration of such thirty (30) day period, unless Landlord's Work has been completed prior to the expiration of such thirty (30) day period. 4.4 half (1/2) day's rent (calculated at a one-half of the daily rate based on a thirty day month) for each day such completion and delivery is delayed beyond the Outside Date. It is hereby agreed that the liquidated damages to which Tenant is entitled hereunder is a reasonable estimate of the damages to Tenant that would be caused destruction occasioned by Landlord's delay in completing Landlord's Work and delivering the Premises. 4.5 Landlord hereby agrees to pay to Tenant a construction payment (the "CONSTRUCTION PAYMENT") in an amount equal to One Hundred Sixty-five Thousand and 00/100 Dollars ($165,000.00), which Construction Payment is made not as an inducement to Tenant to enter into this Lease but to defray the cost of Tenant's Work. Landlord shall pay the Construction Payment within thirty (30) days after Tenant's Work has been completed, Tenant has obtained a certificate of occupancy for the Premises, Tenant has opened for business and Tenant has delivered lien waivers for all work performed or material supplied (except no lien waivers shall be required for any subcontractor whose work or materials does not exceed $3,000). Provided Tenant has complied with the above requirements, if Landlord fails to pay the Construction Payment within thirty (30) days after notice from Tenant that same is past due, Tenant shall have the right, in addition to any other rights or remedies available to Tenant hereunder, at law or in equity, to offset the amount owing from future installments of Fixed Rent and any additional charges payable by Tenant under the Lease until Tenant is reimbursed said Construction Payment in full, with interest on the remaining balance from the date such Construction Payment was due until so reimbursed to Tenant at the rate of ten percent (10%) per annum. 4.6 Attached hereto as EXHIBIT G are the design elevations and store fronts to be constructed by Tenant as part of Tenant's Work (the "ELEVATION DESIGNS"). Within sixty (60) days after the Effective Date, Landlord shall process and obtain the necessary discretionary approvals from the City of Chico (including the Architectural Review Board) for construction of said Elevation Designs (excluding building permits)own negligence. Tenant shall give indemnify, defend and hold Landlord prior notice of any changes in the Elevation Designs harmless from and any material changes thereto shall not be made without the prior written consent of Landlordagainst claims, which consent shall not be unreasonably withheld or delayed; providedliabilities, howeverlosses, Landlord may withhold its consent if any such material change (i) requires additional approvals from the City of Chico or delay the processing of Landlord's application for said approvalsdamages, (ii) requires structural modifications to the building of which the Premises are a partexpenses, or (iii) affects the design attorneys' fees incurred or dimensions of the Blockbuster Video elevations or storefront. Notwithstanding the foregoing provisions of Paragraph 4.5 and this Paragraph 4.6, within thirty (30) days of the Effective Date, Landlord shall prepare construction drawings for the construction of additional wall openings on the west and south elevations of the Premises, as indicated on EXHIBIT G annexed hereto, including any structural modifications necessary to ensure the structural integrity of the building (whether or not such modifications are located within the Premises) and Tenant shall approve or disapprove such drawings within five (5) days of submission sustained by Landlord and shall cooperate with Landlord to finally approve such drawings within five (5) days after the expiration of such fifteen (15) day preparation period. On or before the latest to occur of (i) ten (10) business days after Tenant's final approval of such drawings or (ii) March 1, 1996, Landlord shall obtain bid submissions for such additional wall openings, from at least three (3) contractors, one (1) of which, at Tenant's option, shall be a contractor designated by Tenant (prior to the date Landlord submits its drawings for bids) and reasonably acceptable to Landlord. Landlord shall immediately thereafter deliver to Tenant copies of the bid packages received by Landlord from all of the bidders, together with an itemized budget showing a detailed breakdown by trade and contractor, unit costs and those additional costs associated with the modifications not located within the Premises but required as a result of the requested wall openings. Within five (5) business days from receipt of the bids any actions or work by Tenant, Tenant shall direct Landlord whether to accept or reject and any of Tenant's Permittees in the bidsPremises or elsewhere in the Project prior to the Commencement Date, or with respect to damage or destruction of property of Tenant, Tenant's Permittees and/or of third persons moved on the Premises prior to the Commencement Date at Tenant's request. In the event Tenant directs hereby releases Landlord to accept from any of the bidsand all such claims, Landlord shall arrange for the performance of such workliabilities, the Construction Payment shall be reduced by the amount of the lowest bidlosses, together with Landlord's actual out-of-pocket cost to prepare the construction drawings (in an amount not to exceed $4,600)damages, expenses and the construction of such additional wall openings (including, without limitation, any required structural modifications located within or outside the Premises) shall be deemed to be part of Landlord's Work for all purposes of this Lease. In the event Landlord does not perform such work as aforesaid, the Construction Payment shall nevertheless be reduced by Landlord's actual out-of-pocket cost to prepare the construction drawings, in an amount not to exceed $4,600attorneys' fees.

CONSTRUCTION OF THE PREMISES. 4.1 Landlord (a) If Developer defaults in the construction of the School Base Building Work or any approved Change Order (each as defined in the Agreement) in accordance with the applicable construction requirements of the Agreement, in each such case beyond any applicable notice, grace and/or cure periods as set forth in the Agreement, then upon written demand of SCA (the “Demand Notice”) and subject to the terms of Section 15 hereof, Guarantor shall (without duplication): (i) subject to Force Majeure and SCA Delay (both as defined in the Agreement) but otherwise in accordance with the obligations of Developer under the Agreement, (x) commence or recommence and diligently pursue, as applicable, the School Base Building Work, such Change Orders, or any Punch List Items (as defined in the Agreement) relating thereto, as the case may be, until the same are completed in accordance with the applicable provisions of the Agreement or (y) cause the School Base Building Work, such Change Orders, or the Punch List Items relating thereto, as the case may be, to be so commenced or recommenced, as applicable, and to be diligently pursued until same are completed in accordance with the applicable provisions of the Agreement, and, to the extent of Developer’s obligations therefor under the Agreement, obtain a PCO for the Building (the “Guaranteed Work”); and/or (ii) fully and punctually pay and discharge any and all unpaid Public School Project Costs as the same become due and payable but only to the extent, and in the amount by which, such Public School Project Costs exceed the Public School Project Costs Not-to-Exceed Amount, as and to the extent Developer is obligated to pay for the same pursuant to the Agreement (collectively, the “Guaranteed Construction Costs”), which Guaranteed Construction Costs shall be reduced by the sum of (X) the cost of any Change Order for which SCA is responsible pursuant to the Agreement, (Y) any costs related to SCA Delays that SCA is responsible for pursuant to the Agreement, and (Z) any costs otherwise incurred in respect of Public School Project Costs as a result of a breach by SCA of the Agreement; and/or (iii) in the event that SCA terminates the Agreement, the Master Lease, and the Sublease pursuant to the final sentence of Section 12.04(a) of the Agreement, reimburse SCA for all Public School Project Costs paid by SCA to Developer and not reimbursed by Developer. The obligations set forth in Section 1(a) are referred to as the “Guaranteed Obligations.” Notwithstanding anything to the contrary contained herein, in no event shall the “Guaranteed Obligations” include any obligations (for payment, performance or otherwise) in respect of (1) any SCA Pre- and Post-Turnover Work, or (2) any changes to the School Base Building Work which are not made by Developer and which are made after Developer’s construction lender exercises any remedies under its construction loan, which remedies result in Developer no longer controlling the Project. (b) If Guarantor elects to commence or recommence, as applicable, and diligently pursue the Guaranteed Work pursuant to clause (x) or (y) in Section 1(a)(i) above, then: (i) Guarantor shall provide written notice of such election to SCA not later than the twentieth (20th) day following receipt of such Demand Notice from SCA; (ii) subject to Force Majeure and SCA Delay, Guarantor shall, at Landlord's sole expense and in compliance with all applicable codes, laws, regulations and ordinances, perform the work set forth on EXHIBIT D annexed hereto ("LANDLORD'S WORK"). Within within forty-five (45) days after the Effective Date, Tenant shall complete the preparation of plans and specifications for Tenant's finish-out work and all other work (including any work which is not the responsibility of Landlord as set forth in EXHIBIT D) necessary to prepare the Premises for Tenant's occupancy and deliver same to Landlord and Landlord's architect. Landlord shall, within five (5) business days after receipt of such plans and specificationsDemand Notice, either approve commence or disapprove such plans and specifications. If Landlord disapproves same, Landlord's objections shall be stated with sufficient particularity to permit Tenant to revise said plans. The above procedure shall continue until Tenant's plans and specifications are approved by Landlord (such plans and specificationsrecommence, as approved by Landlordapplicable, hereinafter referred the Guaranteed Work (or cause same), and thereafter shall diligently pursue such Guaranteed Work (or cause same to be pursued) until same has been completed in accordance with the Agreement; (iii) so long as "TENANT'S PLANS" and the work shown thereon hereinafter referred to as "TENANT'S WORK"). If Landlord fails to approve Guarantor is not in default of its obligations under this Completion Guaranty beyond any applicable grace or disapprove Tenant's plans and specifications within the aforesaid five (5) business day cure period, such plans and specifications shall be deemed approved by Landlord. Landlord SCA shall not unreasonably withhold exercise any of its consent to Tenant's plans and specifications. Within rights or remedies under the earlier to occur of Agreement or this Completion Guaranty; (iiv) sixty (60) days after Landlord has approved Tenant's Plans or (ii) March 15, 1996 (the "PERMIT PERIOD"), Tenant shall use reasonably diligent efforts to obtain a building permit for Tenant's Work (including all signage) and shall deliver Landlord notice upon its receipt thereof ("TENANT'S PERMIT NOTICE"). If Tenant fails to obtain a building permit for Tenant's Work within the Permit Period, Tenant may, without liability or further obligation, terminate this Lease upon written notice to Landlord delivered within five (5) days after the expiration of the Permit Period, and this Lease shall have no further force or effect. If Tenant fails to terminate the Lease as aforesaid within five (5) days after expiration of the Permit Period, Tenant shall be deemed to have received a building permit and Tenant's right to terminate this Lease under this Paragraph shall cease. Notwithstanding the foregoing, if Tenant fails to obtain a building permit for Tenant's Work prior to the expiration of the Permit Period, Landlord Guarantor shall be entitled to extend the Permit Period receive, and SCA shall pay to Guarantor, any Public School Project Cost payable by not more than thirty (30) days by notice to Tenant and obtain such permits on Tenant's behalf (Tenant being responsible for any municipal fees to obtain said permits) making only those changes to Tenant's Plans as are approved by Tenant and which are necessary to comply with applicable governmental codes and regulations. If Landlord obtains the permits necessary to complete Tenant's Work within sixty (60) days of expiration of the Permit Period, Tenant's option to terminate this Lease as provided in this paragraph 4.1 shall cease. 4.2 Provided Landlord has delivered the Contingency Satisfaction Notice to Tenant or such Contingency Satisfaction Notice is deemed delivered pursuant to Paragraph 37.14, Landlord shall obtain all necessary approvals, licensing and building permits for Landlord's Work and shall commence construction of Landlord's Work (collectively, "LANDLORD'S PRELIMINARY WORK") on or prior to the date ("LANDLORD'S WORK COMMENCEMENT DATE") which is ten (10) days from the earlier of (i) the date Landlord receives Tenant's Permit Notice or (ii) the date Landlord receives a written notice from Tenant that Tenant has waived its right under Paragraph 4.1 to terminate this Lease because of failure to obtain a building permit (the "PERMIT WAIVER NOTICE") (such notices referred to in clauses (i) and (ii) to be delivered no earlier than sixty (60) days after Lease execution). If Landlord fails to perform Landlord's Preliminary Work on or prior to Landlord's Work Commencement Date, Tenant may, without liability or further obligation, terminate this Lease upon ten (10) days written notice to Landlord, in which event this Lease shall terminate and shall have no further force or effect upon the expiration of such ten (10) day period, unless all necessary approvals, licensing and building permits for Landlord's Work have been obtained and Landlord's Work has commenced prior to the expiration of such ten (10) day period. 4.3 In the event Landlord fails to complete construction of the Landlord's Work and deliver the Premises to Tenant SCA in accordance with Article 5 below within eighty (80) days from Landlord's Work Commencement Date (which date shall not be subject to delays permitted under Article 33) (the "OUTSIDE DATE")Agreement and/or any documents executed in connection therewith, Tenant may, without liability or further obligation, terminate this Lease upon thirty (30) days written notice to Landlord, in which event this Lease shall terminate and shall have no further force or effect upon the expiration of such thirty (30) day period, unless Landlord's Work has been completed prior to the expiration of such thirty (30) day period. 4.4 half (1/2) day's rent (calculated at a one-half of the daily rate based on a thirty day month) for each day such completion and delivery is delayed beyond the Outside Date. It is hereby agreed that the liquidated damages to which Tenant is entitled hereunder is a reasonable estimate of the damages to Tenant that would be caused by Landlord's delay in completing Landlord's Work and delivering the Premises. 4.5 Landlord hereby agrees to pay to Tenant a construction payment (the "CONSTRUCTION PAYMENT") in an amount equal to One Hundred Sixty-five Thousand and 00/100 Dollars ($165,000.00), which Construction Payment is made not as an inducement to Tenant to enter into this Lease but to defray the cost of Tenant's Work. Landlord shall pay the Construction Payment within thirty (30) days after Tenant's Work has been completed, Tenant has obtained a certificate of occupancy for the Premises, Tenant has opened for business and Tenant has delivered lien waivers for all work performed or material supplied (except no lien waivers shall be required for any subcontractor whose work or materials does not exceed $3,000). Provided Tenant has complied with the above requirements, if Landlord fails to pay the Construction Payment within thirty (30) days after notice from Tenant that same is past due, Tenant shall have the right, in addition to any other rights or remedies available to Tenant hereunder, at law or in equity, to offset the amount owing from future installments of Fixed Rent and any additional charges payable by Tenant under the Lease until Tenant is reimbursed said Construction Payment in full, with interest on the remaining balance from the date such Construction Payment was due until so reimbursed to Tenant at the rate of ten percent (10%) per annum. 4.6 Attached hereto as EXHIBIT G are the design elevations and store fronts to be constructed by Tenant as part of Tenant's Work (the "ELEVATION DESIGNS"). Within sixty (60) days after the Effective Date, Landlord shall process and obtain the necessary discretionary approvals from the City of Chico (including the Architectural Review Board) for construction of said Elevation Designs (excluding building permits). Tenant shall give Landlord prior notice of any changes in the Elevation Designs and any material changes thereto shall not be made without the prior written consent of Landlord, which consent shall not be unreasonably withheld or delayed; provided, however, Landlord may withhold its consent if any such material change (i) requires additional approvals from the City of Chico or delay the processing of Landlord's application for said approvals, (ii) requires structural modifications to the building of which the Premises are a part, or (iii) affects the design or dimensions of the Blockbuster Video elevations or storefront. Notwithstanding the foregoing provisions of Paragraph 4.5 and this Paragraph 4.6, within thirty (30) days of the Effective Date, Landlord shall prepare construction drawings for the construction of additional wall openings on the west and south elevations of the Premises, as indicated on EXHIBIT G annexed hereto, including any structural modifications necessary to ensure the structural integrity of the building (whether or not such modifications are located within the Premises) and Tenant shall approve or disapprove such drawings within five (5) days of submission by Landlord and shall cooperate with Landlord to finally approve such drawings within five (5) days after the expiration of such fifteen (15) day preparation period. On or before the latest to occur of (i) ten (10) business days after Tenant's final approval of such drawings or (ii) March 1, 1996, Landlord shall obtain bid submissions for such additional wall openings, from at least three (3) contractors, one (1) of which, at Tenant's option, shall be a contractor designated by Tenant (prior to the date Landlord submits its drawings for bids) and reasonably acceptable to Landlord. Landlord shall immediately thereafter deliver to Tenant copies of the bid packages received by Landlord from all of the bidders, together with an itemized budget showing a detailed breakdown by trade and contractor, unit costs and those additional costs associated with the modifications not located within the Premises but required as a result of the requested wall openings. Within five (5) business days from receipt of the bids by Tenant, Tenant shall direct Landlord whether to accept or reject any of the bids. In the event Tenant directs Landlord to accept any of the bids, Landlord shall arrange for the performance of such work, the Construction Payment shall be reduced by the amount of the lowest bid, together with Landlord's actual out-of-pocket cost to prepare the construction drawings (in an amount not to exceed $4,600), and the construction of such additional wall openings (including, without limitation, all Public School Project Costs up to the Public School Project Costs Not-to-Exceed Amount, Change Order costs for which SCA is responsible and costs related to SCA Delay, all in accordance with the provisions of the Agreement, in the same manner as though Guarantor were Developer thereunder and assuming for purposes hereof and thereof that Guarantor shall have the same rights and obligations as Developer thereunder; and (v) in the event that Guarantor engages any required structural modifications located within or outside contractors with respect to the Premises) Guaranteed Work, other than the contractors engaged by Developer pursuant to the terms of the Agreement, such contractors shall be deemed subject to the prior approval of SCA, such approval not to be part unreasonably withheld, conditioned or delayed and the engagement of Landlord's Work for all purposes such contractor shall be subject to the terms and conditions of this Lease. In the event Landlord does not perform such work as aforesaid, the Construction Payment shall nevertheless be reduced by Landlord's actual out-of-pocket cost to prepare the construction drawings, in an amount not to exceed $4,600Agreement.

CONSTRUCTION OF THE PREMISES. 4.1 Landlord shall(a) Lessor shall at its own expense construct the Premises in accordance with plans and specifications prepared by the Lessor's architect, incorporating in the construction of the Premises Lessor's standard structural systems, materials and finishes. Lessee shall at Landlordits own cost and expense construct those improvements to the Premises that are necessary to complete the Premises for Lessees use and occupancy. The respective obligations, covenants and agreements of Lessor and Lessee to construct the Premises, including the division of responsibilities and procedures for design and construction and for payment of costs and expenses, are as more specifically set forth in Exhibit "B" attached hereto and incorporated herein by this reference. (b) All construction work, alterations and improvements to the interior or exterior of the Premises are subject to the prior written approval of Lessor and Lessor's architect. Lessee may not require an exterior design, finish or construction other than one which has been approved by Lessor and Lessor's architect. Without Lessor's written consent, which may be withheld on the basis of aesthetics or other standards, Lessee shall not: (1) make any changes to the store front as shown in the working drawings. (2) install any exterior lighting, awnings or canopy, or any exterior decorations or paintings; or (3) install any exterior sign which is not in accordance with Lessor's sign criteria. (c) Upon notification by Lessor that Lessor's construction obligations are substantially complete or that the commencement of Lessee's work is necessary to allow the completion of Lessor's work, Lessee shall perform all work required of Lessee under Exhibit "B" of this lease (Lessee's work). Lessee's work shall be performed through the services of a licensed, bondable contractor approved by Lessor, in a good and workmanlike manner, free of any liens or encumbrances, and in strict accordance with the plans and specifications prepared by Lessee's architect at Lessee's sole expense cost and expenses and approved by Lessor in compliance writing and with all applicable codesstatutes ordinances, lawsrules, regulations and ordinancesbuilding codes of any governmental authority having jurisdiction over the Premises. During the course of Lessee's construction, perform Lessor may enter upon the work set forth on EXHIBIT D annexed hereto ("LANDLORD'S WORK"). Within forty-five (45) days after Premises at all times for the Effective Date, Tenant shall complete the preparation purpose of plans and specifications for Tenantcompleting Lessor's finish-out work and all other work (including inspecting the construction of Lessee's Work. If Lessor shall find any work which is workmanship inferior, defective or not in accordance with the responsibility of Landlord as set forth in EXHIBIT D) necessary to prepare the Premises for Tenant's occupancy and deliver same to Landlord and Landlord's architect. Landlord shall, within five (5) business days after receipt of such plans and specifications, either approve Lessor may notify Lessee and if so notified, Lessee shall promptly correct such inferior, defective or disapprove such plans and specificationsdeficient construction. If Landlord disapproves same, LandlordLessor's objections shall be stated with sufficient particularity authority to permit Tenant to revise said plans. The above procedure shall continue until Tenant's plans and specifications are approved by Landlord (such plans and specifications, as approved by Landlord, hereinafter referred to as "TENANT'S PLANS" and the work shown thereon hereinafter referred to as "TENANT'S WORK"). If Landlord fails to approve or disapprove Tenant's plans and specifications within the aforesaid five (5) business day period, such plans and specifications shall be deemed approved by Landlord. Landlord act under this paragraph shall not unreasonably withhold its consent give rise to Tenanta duty of Lessor to make inspections or otherwise enforce Lessee's plans and specificationscompliance with this Article. Within the earlier Lessee's failure to occur of (i) sixty (60) days after Landlord has approved Tenant's Plans perform or (ii) March 15, 1996 (the "PERMIT PERIOD"), Tenant shall use reasonably diligent efforts cause to obtain a building permit for Tenanthave performed Lessee's Work (including all signage) in a good and workmanlike manner shall deliver Landlord notice upon its receipt thereof ("TENANT'S PERMIT NOTICE"). If Tenant fails to obtain constitute a building permit for Tenant's Work within the Permit Period, Tenant may, without liability or further obligation, terminate default of this Lease upon written notice to Landlord delivered within five (5) days after the expiration of the Permit Period, and this Lease shall have no further force or effect. If Tenant fails to terminate the Lease as aforesaid within five (5) days after expiration of the Permit Period, Tenant shall be deemed to have received a building permit and Tenant's right to terminate this Lease under this Paragraph shall cease. Notwithstanding the foregoing, if Tenant fails to obtain a building permit for Tenant's Work prior to the expiration of the Permit Period, Landlord shall be entitled to extend the Permit Period by not more than thirty (30) days by notice to Tenant and obtain such permits on Tenant's behalf (Tenant being responsible for any municipal fees to obtain said permits) making only those changes to Tenant's Plans as are approved by Tenant and which are necessary to comply with applicable governmental codes and regulations. If Landlord obtains the permits necessary to complete Tenant's Work within sixty (60) days of expiration of the Permit Period, Tenant's option to terminate this Lease as provided in this paragraph 4.1 shall ceaseLease. 4.2 Provided Landlord has delivered (d) At the Contingency Satisfaction Notice to Tenant or such Contingency Satisfaction Notice is deemed delivered pursuant to Paragraph 37.14, Landlord shall obtain all necessary approvals, licensing and building permits for Landlord's Work and shall commence construction of Landlord's Work (collectively, "LANDLORD'S PRELIMINARY WORK") on or prior to the date ("LANDLORD'S WORK COMMENCEMENT DATE") which is ten (10) days from the earlier of (i) the date Landlord receives Tenant's Permit Notice or (ii) the date Landlord receives a written notice from Tenant that Tenant has waived its right under Paragraph 4.1 to terminate this Lease because of failure to obtain a building permit (the "PERMIT WAIVER NOTICE") (such notices referred to in clauses (i) and (ii) to be delivered no earlier than sixty (60) days after Lease execution). If Landlord fails to perform Landlord's Preliminary Work on or prior to Landlord's Work Commencement Date, Tenant may, without liability or further obligation, terminate this Lease upon ten (10) days written notice to Landlord, in which event this Lease shall terminate and shall have no further force or effect upon the expiration of such ten (10) day period, unless all necessary approvals, licensing and building permits for Landlord's Work have been obtained and Landlord's Work has commenced prior to the expiration of such ten (10) day period. 4.3 In the event Landlord fails to complete construction of the Landlord's Work and deliver time Lessee enters the Premises to Tenant perform the work required of Lessee: (1) All of Lessee's obligations under this Lease, except the obligation to pay rent shall be in full force and effect. (2) Lessee agrees to maintain heating, ventilating and air conditioning in the Premises and to pay for the utilities (heat, gas, water and electricity) which shall be furnished to the Premises from that time. (3) Lessee shall maintain liability insurance in accordance with Article 5 below within eighty (80) days from Landlord's Work Commencement Date (which date shall not be subject to delays permitted under Article 33) (the "OUTSIDE DATE"), Tenant may, without liability or further obligation, terminate 10 of this Lease upon thirty (30) days written notice to Landlord, in which event this Lease shall terminate and shall have no further force or effect upon the expiration of such thirty (30) day period, unless Landlord's Work has been completed prior to the expiration of such thirty (30) day periodLease. 4.4 half (1/24) dayLessee shall require Lessee's rent (calculated at a one-half contractor(s) to maintain Workmen's Compensation Insurance as required by law and public liability insurance with limits equal to those set forth in Article 10. Lessee agrees to indemnify, save, and hold harmless against any loss, liability injury or damage to persons or property resulting from such work including the activities of the daily rate based on a thirty day month) for each day such completion and delivery is delayed beyond the Outside Date. It is hereby agreed that the liquidated damages to which Tenant is entitled hereunder is a reasonable estimate of the damages to Tenant that would be caused by LandlordLessee's delay in completing Landlord's Work and delivering the Premisescontractor(s). 4.5 Landlord hereby agrees to pay to Tenant a construction payment (the "CONSTRUCTION PAYMENT") in an amount equal to One Hundred Sixty-five Thousand and 00/100 Dollars ($165,000.00), which Construction Payment is made not as an inducement to Tenant to enter into this Lease but to defray the cost of Tenant's Work. Landlord shall pay the Construction Payment within thirty (30) days after Tenant's Work has been completed, Tenant has obtained a certificate of occupancy for the Premises, Tenant has opened for business and Tenant has delivered lien waivers for all work performed or material supplied (except no lien waivers shall be required for any subcontractor whose work or materials does not exceed $3,000). Provided Tenant has complied with the above requirements, if Landlord fails to pay the Construction Payment within thirty (30) days after notice from Tenant that same is past due, Tenant shall have the right, in addition to any other rights or remedies available to Tenant hereunder, at law or in equity, to offset the amount owing from future installments of Fixed Rent and any additional charges payable by Tenant under the Lease until Tenant is reimbursed said Construction Payment in full, with interest on the remaining balance from the date such Construction Payment was due until so reimbursed to Tenant at the rate of ten percent (10%) per annum. 4.6 Attached hereto as EXHIBIT G are the design elevations and store fronts to be constructed by Tenant as part of Tenant's Work (the "ELEVATION DESIGNS"). Within sixty (60) days after the Effective Date, Landlord shall process and obtain the necessary discretionary approvals from the City of Chico (including the Architectural Review Board) for construction of said Elevation Designs (excluding building permits). Tenant shall give Landlord prior notice of any changes in the Elevation Designs and any material changes thereto shall not be made without the prior written consent of Landlord, which consent shall not be unreasonably withheld or delayed; provided, however, Landlord may withhold its consent if any such material change (i) requires additional approvals from the City of Chico or delay the processing of Landlord's application for said approvals, (ii) requires structural modifications to the building of which the Premises are a part, or (iii) affects the design or dimensions of the Blockbuster Video elevations or storefront. Notwithstanding the foregoing provisions of Paragraph 4.5 and this Paragraph 4.6, within thirty (30) days of the Effective Date, Landlord shall prepare construction drawings for the construction of additional wall openings on the west and south elevations of the Premises, as indicated on EXHIBIT G annexed hereto, including any structural modifications necessary to ensure the structural integrity of the building (whether or not such modifications are located within the Premises) and Tenant shall approve or disapprove such drawings within five (5) days of submission by Landlord and shall cooperate with Landlord to finally approve such drawings within five (5) days after the expiration of such fifteen (15) day preparation period. On or before the latest to occur of (i) ten (10) business days after Tenant's final approval of such drawings or (ii) March 1, 1996, Landlord shall obtain bid submissions for such additional wall openings, from at least three (3) contractors, one (1) of which, at Tenant's option, shall be a contractor designated by Tenant (prior to the date Landlord submits its drawings for bids) and reasonably acceptable to Landlord. Landlord shall immediately thereafter deliver to Tenant copies of the bid packages received by Landlord from all of the bidders, together with an itemized budget showing a detailed breakdown by trade and contractor, unit costs and those additional costs associated with the modifications not located within the The Premises but required as a result of the requested wall openings. Within five (5) business days from receipt of the bids by Tenant, Tenant shall direct Landlord whether to accept or reject any of the bids. In the event Tenant directs Landlord to accept any of the bids, Landlord shall arrange for the performance of such work, the Construction Payment shall be reduced by the amount of the lowest bid, together with Landlord's actual out-of-pocket cost to prepare the construction drawings (in an amount not to exceed $4,600), and the construction of such additional wall openings (including, without limitation, any required structural modifications located within or outside the Premises) shall be deemed to be part of Landlordin good and satisfactory condition. (e) Lessee shall have no right to enter the Premises and to perform Lessee's Work prior to Lessor's notice that the Premises are substantially completed or that the commencement of Lessee's Work is required to allow Lessor to complete its work, without Lessor's prior written consent. If Lessor does so consent, Lessee shall comply with the directions of Lessor and shall not interfere with any of Lessor's construction activities. (f) Prior to the commencement of the Lease term, any work performed by Lessee, or any fixtures or personal property moved onto the Premises, shall be at Lessee's own risk. Neither Lessor nor Lessor's agents or contractors shall be responsible to Lessee for damage or destruction of Lessee's Work or property, including damage or destruction occasioned by Lessor's own negligence. Lessee agrees to indemnify Lessor and hold Lessor harmless against claims made with respect to damage or destruction of property of third persons moved onto the Premises by Lessee or at Lessee's request. (g) Notwithstanding anything herein to the contrary, should Lessor fail to secure or obtain construction and permanent financing acceptable to Lessor in Lessor's sole and absolute discretion within six (6) months after completion of final plans and specifications for the Shopping Center, Lessor may so notify Lessee in writing, and this Lease shall, at Lessor's option, thereupon cease and terminate and each of the parties hereto shall be released and discharged from any and all purposes liability and responsibility hereunder. If Lessor can obtain financing only upon the basis of modifications of the terms and provisions of this Lease, then Lessor shall have the right to cancel this Lease if Lessee refuses to approve in writing any such modifications within Ten (10) days after Lessor's request therefor. In If such right to cancel is exercised, this Lease shall thereafter be null and void, any money or other security deposited hereunder shall be returned to Lessee, and neither party shall have any liability to the event Landlord does not perform other by reason of such work as aforesaid, cancellation. (h) Lessor reserves the Construction Payment shall nevertheless be reduced by Landlord's actual out-of-pocket cost right to prepare add land to and/or withdraw land from the construction drawings, in an amount not Shopping Center and to exceed $4,600reconfigure the Common Areas.

CONSTRUCTION OF THE PREMISES. 4.1 Landlord shallshall construct the Building in accordance with the general site plan attached hereto as Exhibit A (the “Site Plan”), at as it may be amended by the Landlord in its discretion from time to time provided that, in its amendment of the Site Plan, Landlord uses reasonable efforts to minimize any interference with Tenant’s use and occupancy of, visibility of, or access to the Premises. The Premises are to be generally constructed in accordance with the specifications entitled “Description of Landlord's sole expense and ’s Work” in compliance with all applicable codes, laws, regulations and ordinances, perform Provisions Relating to the work Construction of Premises set forth in Exhibit C, attached hereto. Following the walk-through inspection and the creation of a punch list as described in Exhibit C paragraph 3, the Premises will be considered Substantially Completed on EXHIBIT D annexed hereto the date Landlord’s Work as described in Exhibit C, Schedule 1, is substantially completed enabling Tenant at Tenant’s reasonable discretion to accept delivery of the Premises in a condition to allow Tenant to immediately begin Tenant Improvements. Tenant shall take possession of the Premises as soon as possible after Landlord’s Work is complete, shall commence the construction of Tenant’s Improvements, shall diligently prosecute such construction to completion, and shall open the Premises for business as soon as reasonably possible thereafter. If the Possession Date has not occurred by April 1, 2016, then Tenant may terminate this Lease upon delivery of notice to Landlord and shall have no remaining liability with respect to this Lease. Upon receipt of Tenant’s notice of termination, Landlord shall immediately return Tenant’s Security Deposit and prepaid rent. Landlord and Tenant shall execute a Commencement Date Certificate, substantially in the form attached to this Lease as Exhibit H, within fifteen ("LANDLORD'S WORK"). Within forty-five (4515) days after the Effective Commencement Date, Tenant shall complete the preparation of plans and specifications for Tenant's finish-out work and all other work (including any work which is not the responsibility of Landlord as set forth in EXHIBIT D) necessary to prepare the Premises for Tenant's occupancy and deliver same to Landlord and Landlord's architect. Landlord shall, within five (5) business days after receipt of such plans and specifications, either approve or disapprove such plans and specifications. If Landlord disapproves same, Landlord's objections shall be stated with sufficient particularity to permit Tenant to revise said plans. The above procedure Commencement Date Certificate shall continue until Tenant's plans and specifications are approved by Landlord (such plans and specifications, as approved by Landlord, hereinafter referred to as "TENANT'S PLANS" and amend the work shown thereon hereinafter referred to as "TENANT'S WORK"). If Landlord fails to approve or disapprove Tenant's plans and specifications within the aforesaid five (5) business day period, such plans and specifications shall be deemed approved by Landlord. Landlord shall not unreasonably withhold its consent to Tenant's plans and specifications. Within the earlier to occur terms of (i) sixty (60) days after Landlord has approved Tenant's Plans or (ii) March 15, 1996 (the "PERMIT PERIOD"), Tenant shall use reasonably diligent efforts to obtain a building permit for Tenant's Work (including all signage) and shall deliver Landlord notice upon its receipt thereof ("TENANT'S PERMIT NOTICE"). If Tenant fails to obtain a building permit for Tenant's Work within the Permit Period, Tenant may, without liability or further obligation, terminate this Lease upon written notice to Landlord delivered within five (5) days after the expiration of the Permit Period, and this Lease shall have no further force or effect. If Tenant fails to terminate the Lease as aforesaid within five (5) days after expiration of the Permit Period, Tenant shall be deemed to have received a building permit and Tenant's right to terminate this Lease under this Paragraph shall cease. Notwithstanding the foregoing, if Tenant fails to obtain a building permit for Tenant's Work prior to the expiration of the Permit Period, Landlord shall be entitled to extend the Permit Period by not more than thirty (30) days by notice to Tenant and obtain such permits on Tenant's behalf (Tenant being responsible for any municipal fees to obtain said permits) making only those changes to Tenant's Plans as are approved by Tenant and which are necessary to comply with applicable governmental codes and regulations. If Landlord obtains the permits necessary to complete Tenant's Work within sixty (60) days of expiration of the Permit Period, Tenant's option to terminate this Lease as provided in this paragraph 4.1 shall cease. 4.2 Provided Landlord has delivered the Contingency Satisfaction Notice to Tenant or such Contingency Satisfaction Notice is deemed delivered pursuant to Paragraph 37.14, Landlord shall obtain all necessary approvals, licensing and building permits for Landlord's Work specified therein and shall commence construction of Landlord's Work (collectively, "LANDLORD'S PRELIMINARY WORK") on or prior to be binding throughout the date ("LANDLORD'S WORK COMMENCEMENT DATE") which is ten (10) days from the earlier of (i) the date Landlord receives Tenant's Permit Notice or (ii) the date Landlord receives a written notice from Tenant that Tenant has waived its right under Paragraph 4.1 to terminate this Lease because of failure to obtain a building permit (the "PERMIT WAIVER NOTICE") (such notices referred to in clauses (i) and (ii) to be delivered no earlier than sixty (60) days after Lease execution). If Landlord fails to perform Landlord's Preliminary Work on or prior to Landlord's Work Commencement Date, Tenant may, without liability or further obligation, terminate this Lease upon ten (10) days written notice to Landlord, in which event this Lease shall terminate and shall have no further force or effect upon the expiration of such ten (10) day periodTerm, unless all necessary approvals, licensing and building permits for Landlord's Work have been obtained and Landlord's Work has commenced prior to the expiration of such ten (10) day period. 4.3 In the event Landlord fails to complete construction of the Landlord's Work and deliver the Premises to Tenant subsequently amended in accordance with Article 5 below within eighty (80) days from Landlord's Work Commencement Date (which date shall not be subject to delays permitted under Article 33) (the "OUTSIDE DATE"), Tenant may, without liability or further obligation, terminate this Lease upon thirty (30) days written notice to Landlord, in which event this Lease shall terminate and shall have no further force or effect upon the expiration of such thirty (30) day period, unless Landlord's Work has been completed prior to the expiration of such thirty (30) day period. 4.4 half (1/2) day's rent (calculated at a one-half of the daily rate based on a thirty day month) for each day such completion and delivery is delayed beyond the Outside Date. It is hereby agreed that the liquidated damages to which Tenant is entitled hereunder is a reasonable estimate of the damages to Tenant that would be caused by Landlord's delay in completing Landlord's Work and delivering the Premises. 4.5 Landlord hereby agrees to pay to Tenant a construction payment (the "CONSTRUCTION PAYMENT") in an amount equal to One Hundred Sixty-five Thousand and 00/100 Dollars ($165,000.00), which Construction Payment is made not as an inducement to Tenant to enter into this Lease but to defray the cost of Tenant's Work. Landlord shall pay the Construction Payment within thirty (30) days after Tenant's Work has been completed, Tenant has obtained a certificate of occupancy for the Premises, Tenant has opened for business and Tenant has delivered lien waivers for all work performed or material supplied (except no lien waivers shall be required for any subcontractor whose work or materials does not exceed $3,000). Provided Tenant has complied with the above requirements, if Landlord fails to pay the Construction Payment within thirty (30) days after notice from Tenant that same is past due, Tenant shall have the right, in addition to any other rights or remedies available to Tenant hereunder, at law or in equity, to offset the amount owing from future installments of Fixed Rent and any additional charges payable by Tenant under the Lease until Tenant is reimbursed said Construction Payment in full, with interest on the remaining balance from the date such Construction Payment was due until so reimbursed to Tenant at the rate of ten percent (10%) per annum. 4.6 Attached hereto as EXHIBIT G are the design elevations and store fronts to be constructed by Tenant as part of Tenant's Work (the "ELEVATION DESIGNS"). Within sixty (60) days after the Effective Date, Landlord shall process and obtain the necessary discretionary approvals from the City of Chico (including the Architectural Review Board) for construction of said Elevation Designs (excluding building permits). Tenant shall give Landlord prior notice of any changes in the Elevation Designs and any material changes thereto shall not be made without the prior written consent of Landlord, which consent shall not be unreasonably withheld or delayed; provided, however, Landlord may withhold its consent if any such material change (i) requires additional approvals from the City of Chico or delay the processing of Landlord's application for said approvals, (ii) requires structural modifications to the building of which the Premises are a part, or (iii) affects the design or dimensions of the Blockbuster Video elevations or storefront. Notwithstanding the foregoing provisions of Paragraph 4.5 and this Paragraph 4.6, within thirty (30) days of the Effective Date, Landlord shall prepare construction drawings for the construction of additional wall openings on the west and south elevations of the Premises, as indicated on EXHIBIT G annexed hereto, including any structural modifications necessary to ensure the structural integrity of the building (whether or not such modifications are located within the Premises) and Tenant shall approve or disapprove such drawings within five (5) days of submission writing by Landlord and shall cooperate with Landlord to finally approve such drawings within five (5) days after the expiration of such fifteen (15) day preparation period. On or before the latest to occur of (i) ten (10) business days after Tenant's final approval of such drawings or (ii) March 1, 1996, Landlord shall obtain bid submissions for such additional wall openings, from at least three (3) contractors, one (1) of which, at Tenant's option, shall be a contractor designated by Tenant (prior to the date Landlord submits its drawings for bids) and reasonably acceptable to Landlord. Landlord shall immediately thereafter deliver to Tenant copies of the bid packages received by Landlord from all of the bidders, together with an itemized budget showing a detailed breakdown by trade and contractor, unit costs and those additional costs associated with the modifications not located within the Premises but required as a result of the requested wall openings. Within five (5) business days from receipt of the bids by Tenant, Tenant shall direct Landlord whether to accept or reject any of the bids. In the event Tenant directs Landlord to accept any of the bids, Landlord shall arrange for the performance of such work, the Construction Payment shall be reduced by the amount of the lowest bid, together with Landlord's actual out-of-pocket cost to prepare the construction drawings (in an amount not to exceed $4,600), and the construction of such additional wall openings (including, without limitation, any required structural modifications located within or outside the Premises) shall be deemed to be part of Landlord's Work for all purposes of this Lease. In the event Landlord does not perform such work as aforesaid, the Construction Payment shall nevertheless be reduced by Landlord's actual out-of-pocket cost to prepare the construction drawings, in an amount not to exceed $4,600.

CONSTRUCTION OF THE PREMISES. 4.1 Landlord shall6.1 Prior to the Commencement Date, at Landlord's sole expense and in compliance with all applicable codes, laws, regulations and ordinances, Xxxxxx will perform the work and make the installations in the Premises substantially as set forth on EXHIBIT D as Building Standard Work in Exhibit C annexed hereto and made a part hereof (such work and installations being herein called "LANDLORD'S WORKTenant's Work"). Within forty-five (45) days after Tenant, through the Effective Dateservices of LV Construction Corporation, Tenant shall complete whom the preparation of plans and specifications for Tenant's finish-out work and all other work (including any work which is not the responsibility of Landlord as set forth in EXHIBIT D) necessary to prepare the Premises for Tenant's occupancy and deliver same to Landlord and Landlord's architect. Landlord approves, shall, within five (5) business days after receipt when construction progress so permits, notify Landlord in advance of such plans the approximate date on which Xxxxxx's Work will be substantially completed in accordance with Exhibit C and specifications, either approve or disapprove such plans and specificationswill notify Landlord when Xxxxxx's Work is in fact so completed. If Landlord disapproves same, Landlord's objections shall be stated with sufficient particularity to permit Tenant to revise said plans. The above procedure shall continue until Tenant's plans and specifications are approved by Landlord (such plans and specifications, as approved by Landlord, hereinafter referred to as "TENANT'S PLANS" and the work shown thereon hereinafter referred to as "TENANT'S WORK"). If Landlord fails to approve or disapprove Tenant's plans and specifications within the aforesaid five (5) business day period, such plans and specifications shall be deemed approved by Landlord. Landlord shall not unreasonably withhold its consent to Tenant's plans and specifications. Within the earlier to occur Commencement of (i) sixty (60) days after Landlord has approved Tenant's Plans or (ii) March 15, 1996 (the "PERMIT PERIOD"), Tenant shall use reasonably diligent efforts to obtain a building permit for Tenant's Work (including all signage) and shall deliver Landlord notice upon its receipt thereof ("TENANT'S PERMIT NOTICE"). If Tenant fails to obtain a building permit for Tenant's Work within the Permit Period, Tenant may, without liability or further obligation, terminate this Lease upon written notice to Landlord delivered within five (5) days after the expiration constitute delivery of the Permit Period, and this Lease shall have no further force or effect. If Tenant fails to terminate the Lease as aforesaid within five (5) days after expiration possession of the Permit Period, Tenant shall be deemed to have received a building permit and Tenant's right to terminate this Lease under this Paragraph shall cease. Notwithstanding the foregoing, if Tenant fails to obtain a building permit for Tenant's Work prior to the expiration of the Permit Period, Landlord shall be entitled to extend the Permit Period by not more than thirty (30) days by notice to Tenant and obtain such permits on Tenant's behalf (Tenant being responsible for any municipal fees to obtain said permits) making only those changes to Tenant's Plans as are approved by Tenant and which are necessary to comply with applicable governmental codes and regulations. If Landlord obtains the permits necessary to complete Tenant's Work within sixty (60) days of expiration of the Permit Period, Tenant's option to terminate this Lease as provided in this paragraph 4.1 shall cease. 4.2 Provided Landlord has delivered the Contingency Satisfaction Notice to Tenant or such Contingency Satisfaction Notice is deemed delivered pursuant to Paragraph 37.14, Landlord shall obtain all necessary approvals, licensing and building permits for Landlord's Work and shall commence construction of Landlord's Work (collectively, "LANDLORD'S PRELIMINARY WORK") on or prior to the date ("LANDLORD'S WORK COMMENCEMENT DATE") which is ten (10) days from the earlier of (i) the date Landlord receives Tenant's Permit Notice or (ii) the date Landlord receives a written notice from Tenant that Tenant has waived its right under Paragraph 4.1 to terminate this Lease because of failure to obtain a building permit (the "PERMIT WAIVER NOTICE") (such notices referred to in clauses (i) and (ii) to be delivered no earlier than sixty (60) days after Lease execution). If Landlord fails to perform Landlord's Preliminary Work on or prior to Landlord's Work Commencement Date, Tenant may, without liability or further obligation, terminate this Lease upon ten (10) days written notice to Landlord, in which event this Lease shall terminate and shall have no further force or effect upon the expiration of such ten (10) day period, unless all necessary approvals, licensing and building permits for Landlord's Work have been obtained and Landlord's Work has commenced prior to the expiration of such ten (10) day period. 4.3 In the event Landlord fails to complete construction of the Landlord's Work and deliver the Premises to Tenant in accordance with Article 5 below within eighty (80) days from Landlord's Work and notice to Tenant of the Commencement Date (which date pursuant to construction of the Building or the Premises shall not be subject to delays permitted under Article 33) (the "OUTSIDE DATE"), Tenant may, without liability affect or further obligation, terminate change this Lease upon thirty (30) days written notice to Landlord, in which event this Lease shall terminate and shall have no further force or effect upon the expiration of such thirty (30) day period, unless Landlord's Work has been completed prior to the expiration of such thirty (30) day period. 4.4 half (1/2) day's rent (calculated at a one-half of the daily rate based on a thirty day month) for each day such completion and delivery is delayed beyond the Outside Dateinvalidate same. It is hereby agreed that by occupying the liquidated damages Premises, Xxxxxx formally accepts same and acknowledges that the Premises are in the condition called for hereunder. Failure of Landlord to which Tenant is entitled hereunder is a reasonable estimate deliver possession of the Premises within the time and in the condition provided for in this Lease will not give rise to any claim for damages to by Tenant that would be caused by against Landlord or Landlord's delay in completing Landlord's Work and delivering the Premises. 4.5 Landlord hereby agrees to pay to Tenant a construction payment (the "CONSTRUCTION PAYMENT") in an amount equal to One Hundred Sixty-five Thousand and 00/100 Dollars ($165,000.00), which Construction Payment is made not as an inducement to Tenant to enter into this Lease but to defray the cost of Tenant's Workcontractor. Landlord shall pay the Construction disburse to Tenant an Allowance ("Tenant's Allowance") of $15 per square foot of Rentable Area based upon invoices received. Payment shall be made within fifteen (15) days of receipt. Any final balance will be paid thirty (30) days after Tenant's Work construction has been completed, Tenant has obtained a certificate of occupancy for the Premises, Tenant has opened for business completed (including punch list items) and Tenant has delivered lien waivers for all work performed or material supplied (except no lien waivers shall be required for any subcontractor whose work or materials does not exceed $3,000). Provided Tenant has complied with the above requirements, if Landlord fails to pay the Construction Payment within thirty (30) days after notice from Tenant that same is past due, Tenant shall have the right, in addition to any other rights or remedies available to Tenant hereunder, at law or in equity, to offset the amount owing from future installments of Fixed Rent and any additional charges payable by Tenant under the Lease until Tenant is reimbursed said Construction Payment in full, with interest on the remaining balance from the date such Construction Payment was due until so reimbursed to Tenant at the rate of ten percent (10%) per annum. 4.6 Attached hereto as EXHIBIT G are the design elevations and store fronts to be constructed by Tenant as part of Tenant's Work (the "ELEVATION DESIGNS"). Within sixty (60) days after the Effective Date, Landlord shall process and obtain the necessary discretionary approvals from the City of Chico (including the Architectural Review Board) for construction of said Elevation Designs (excluding building permits). Tenant shall give Landlord prior notice of any changes in the Elevation Designs and any material changes thereto shall not be made without the prior written consent of Landlord, which consent shall not be unreasonably withheld or delayed; provided, however, Landlord may withhold its consent if any such material change (i) requires additional approvals from the City of Chico or delay the processing of Landlord's application for said approvals, (ii) requires structural modifications to the building of which the Premises are a part, or (iii) affects the design or dimensions parties approve of the Blockbuster Video elevations or storefront. Notwithstanding the foregoing provisions of Paragraph 4.5 and this Paragraph 4.6, within thirty (30) days of the Effective Date, Landlord shall prepare construction drawings for the construction of additional wall openings on the west and south elevations of the Premises, as indicated on EXHIBIT G annexed hereto, including any structural modifications necessary to ensure the structural integrity of the building (whether or not such modifications are located within the Premises) and Tenant shall approve or disapprove such drawings within five (5) days of submission by Landlord and shall cooperate with Landlord to finally approve such drawings within five (5) days after the expiration of such fifteen (15) day preparation period. On or before the latest to occur of (i) ten (10) business days after Tenant's final approval of such drawings or (ii) March 1, 1996, Landlord shall obtain bid submissions for such additional wall openings, from at least three (3) contractors, one (1) of which, at Tenant's option, shall be a contractor designated by Tenant (prior to the date Landlord submits its drawings for bids) and reasonably acceptable to Landlord. Landlord shall immediately thereafter deliver to Tenant copies of the bid packages received by Landlord from all of the bidders, together with an itemized budget showing a detailed breakdown by trade and contractor, unit costs and those additional costs associated with the modifications not located within the Premises but required as a result of the requested wall openings. Within five (5) business days from receipt of the bids by Tenant, Tenant shall direct Landlord whether to accept or reject any of the bidsfinish. In the event Tenant directs Landlord to accept any of the bidsincurs less than $15.00 per square foot, Landlord shall arrange for credit the performance balance to Tenant in the form of such work, the Construction Payment shall be reduced by the amount of the lowest bid, together with Landlord's actual out-of-pocket cost to prepare the construction drawings (in an amount not to exceed $4,600), and the construction of such additional wall openings (including, without limitation, any required structural modifications located within or outside the Premises) shall be deemed to be part of Landlord's Work for all purposes of this Lease. In the event Landlord does not perform such work as aforesaid, the Construction Payment shall nevertheless be reduced by Landlord's actual out-of-pocket cost to prepare the construction drawings, in an amount not to exceed $4,600rent credits.