Salomon Smith Barney RBC Dain Rauscher Inc

NEW ISSUE - BOOK ENTRY ONLY

$69,475,000 $5,000,000 California State University, Fresno Association, Inc. California State University, Fresno Association, Inc. Auxiliary Organization Event Center Revenue Bonds, Auxiliary Organization Event Center Subordinate Revenue Bonds, Senior Series 2002 Subordinate Series 2002 Dated: January 15, 2002 Due: July 1, as shown on inside front cover

The CaliforniaState University, Fresno Association, Inc. Auxiliary Organization Event Center Revenue Bonds, Senior Series 2002 and the California State University, Fresno Association, Inc. Auxiliary Organization Event Center Subordinate Revenue Bonds, Subordinate Series 2002 will be issued pursuant to an Indenture dated as of January 15, 2002 by and between the California State University, Fresno Association, Inc., a California nonprofit public benefit corporation, and U.S. Bank, N.A., as trustee. The Series 2002 Bonds will mature on the dates and in the amounts listed on the inside front cover page. The Series 2002 Bonds will bear interest at the rates listed on the inside front cover page, payable on July 1, 2002 and on each January 1 and July 1 thereafter. Proceeds of the Series 2002 Bonds will be used to (i) finance the construction of a multi-purpose event center on the campus of the California State University, Fresno, to be known as "Save Mart Center," (ii) fund capitalized interest on the Series 2002 Bonds, (iii) fund reserve accounts and (iv) pay the costs of issuing the Series 2002 Bonds.

The Series 2002 Bonds are limited obligations of the Corporation secured by the Event Center Project Revenues, and the Corporation's interest in a Ground Lease, the Bulldog Foundation MOU, the Student Seating Purchase Agreement and certain Project Documents, as described herein.

The Series 2002 Bonds, when issued, will be registered in the name of Cede & Co., as nominee of The Depository Trust Company, New York, New York. DTC will act as securities depository of the Series 2002 Bonds. Individual purchases will be made in book-entry form only in the principal amount of $5,000 and integral multiples thereof in the case of Senior Series 2002 Bonds, and $100,000 and integral multiples of $5,000 in excess thereof in the case of Subordinate Series 2002 Bonds. Purchasers will not receive certificates representing their interest in the Series 2002 Bonds purchased. The principal of and interest on the Series 2002 Bonds are payable by the Trustee to DTC, which will in tum be responsible to remit such principal and interest to its Participants, which will in tum be responsible to remit such principal and interest to the Beneficial Owners of the Series 2002 Bonds as described herein.

The Series 2002 Bonds are subject to optional, mandatory and special redemption prior to maturity as described herein.

THE SERIES 2002 BONDS DO NOT CREATE A LIEN, CHARGE OR LIABILITY AGAINST THE STATE OF CALIFORNIA OR AGAINST THE TRUSTEES OF THE CALIFORNIA STATE UNIVERSITY OR AGAINST THE PROPERTY OR FUNDS OF EITHER. NO REGISTERED OWNER OF ANY SERIES 2002 BOND SHALL EVER HA VE THE RIGHT TO COMPEL ANY EXERCISE OF THE TAXING POWER OF THE STATE OF CALIFORNIA TO PAY ANY SERIES 2002 BOND. THE TRUSTEES OF THE CALIFORNIA STATE UNIVERSITY HAVE NO TAXING POWER. THE PAYMENT OF THE PRINCIPAL OF AND ANY REDEMP­ TION PREMIUM AND INTEREST ON THE SERIES 2002 BONDS DOES NOT CONSTITUTE A DEBT, LIABILITY OR OBLIGATION OF THE STATE OF CALIFORNIA, THE TRUSTEES OF THE CALIFORNIA STATE UNIVERSITY OR THE INDIVIDUAL CALIFORNIA STATE UNIVERSITY CAMPUSES.

AN INVESTMENT IN THE SERIES 2002 BONDS INVOLVES SIGNIFICANT RISKS. SEE THE CAPTION "RISK FACTORS" HEREIN FOR A DISCUSSION OF CERTAIN RISK FACTORS THAT SHOULD BE CONSIDERED IN CONNECTION WITH AN INVESTMENT IN THE SERIES 2002 BONDS.

In the opinion of Orrick, Herrington & Sutcliffe LLP, Bond Counsel, based upon an analysis of existing laws, regulations, rulings and court decisions and assuming, among other matters, the accuracy of certain representations and compliance with certain covenants, interest on the Series 2002 Bonds is excluded from gross income for federal income tax purposes and is exempt from all taxation in the State of California other than estate and generation skipping transfer taxes. In the further opinion of Bond Counsel, interest on the Series 2002 Bonds is not a specifi"c preference item for purposes of the federal individual and corporate alternative minimum taxes, although Bond Counsel observes that such interest is included in adjusted current earnings in calculating federal corporate alternative minimum taxable income. Bond Counsel expresses no opinion regarding any other tax consequences relating to the ownership or disposition of or the accrual or receipt of interest on, the Series 2002 Bonds. See the caption ''TAX MATTERS" herein.

MATURITY SCHEDULE (See Inside Front Cover)

This cover page contains certain information forquick reference only. It is not a summary of this financing. Prospective investors must read the entire Official Statement and other documents referred to herein to obtain information essential to making an informed investment decision. The Series 2002 Bonds are offered when, as and if issued by the Corporationand received by the Underwriters, subject to prior sale, withdrawalor modifi"cation of the offer without notice, and subject to the delivery of the legal opinion of Orrick, Herrington & Sutcliffe LLP, San Francisco, California, Bond Counsel. Certain legal matters will be passed upon for the Corporation by its counsel, John M. Melikian, Esquire, for the Construction Contractor by its assistant general counsel and for the Underwriters by their counsel, Stradling Yocca Carlson & Rauth, a Professional Corporation. It is expected that delivery of the Series 2002 Bonds will be made throughDTC in New York, New York on or about February 14, 2002. Salomon Smith Barney RBC Dain Rauscher Inc.

January 31, 2002 MATURITY SCHEDULE

$69,475,000SE NI OR SE RIES 2002BONDS

$17,310,000Serial Bands

Maturity Principal Interest Maturity Principal Interest ili!!y_J)_ Armunt Rate Yield ili!!y_J)_ Armunt Rate Yield

2004 $ 1, 860, 000 5.Q0>,.,6 3.25% 2009 $ 945,000 4.75% 4.9(J>,.,6 2005 1, 125, 000 5.00 3.75 2010 950,000 5.00 5.00 2006 1, 310, 000 5.00 4.15 2011 1, 185, 000 5.00 5.03 2007 995,000 4.75 4.50 2012 3,860,000 5.00 5. 13 2008 975,000 4.50 4.75 2013 4,105,000 5.25 5.23

$19,445,0006.Q0>,.,6 Term Bonds due July 1, 2022, Price 100.0(J>,.,6 $16,275,0006.Q0>,.,6 Term Bonds due July 1, 2026, Price 99.Q0>,.,6 $16,445,0006.Q0>,.,6 Term Bonds due July 1, 2031, Price 98.25% (Pl us accrued interest fromJan uary 15, 2002)

$5,000,000SUB OR DINA TE SER IE S 2002BONDS

$2,345,0006.75% Term Bonds due July 1, 2022, Yield 7.15% $2,655,0007.Q0>,.,6 Term Bonds due July 1, 2031, Yield 7.25% (Pl us accrued interest fromJan uary 15, 2002)

CALI FORNI A STATE UNIVERSITY, FRESNO ASSOCIATION, I NC. Board of Directors Benjamin F. Quillian, Chairrmnof the Board J amesA I dredge William Fasse RyanJ acobsen MaxineMcDonald Jamie Mello R. Gary Renner Judy Sakaki

SPECIAL SERVICES

Bond Counsel

Orrick Herrington & Sutcliffe LLP San Francisco, California

Trustee

U.S. Bank, N.A. Los Angel es, California

Feasibility Consultant

Economics Research Associates Los Angel es, California No dealer, broker, salesperson or other personhas been authorized bytthe Corporation or the Underwriters to give any information or to makeany representations in connection with the offer or sale of the Series 2002 Bonds other than those contained herein and, if given or made, such other information or representations must not be relied upon as having beenauthorized byt the Corporation or the U nderwriters. This OfficialS tatell"Entdoes not constitute an offer to selI or the sol i citation of an offer to buy nor shal I there beany sale of the Series 2002 B onds byt a person in anyj uri sdi cti on in which it is unlawful for such personto makesuch an offer, solicitation or sale. This Official Statell"Entis not to beconstrued as a contract with the purchasers or CMtners of the Series 2002 Bonds. State!l"Ents contained in this Official Statell"Ent which involve estimates, forecasts or matters of opinion, whether or not expressly so descri bed herei n, are i ntended solely as such and are not to be construed as representations of fact. This Official Statell"Ent, including any supplell"Entor a!l"End!l"Enthereto, is intended to bedeposited with a nationally recognized municipal securities depository. The Underwriters have provided the follCMting sentence for inclusion in this Official S tatell"Ent: The U nderwri ters have reviewed the information in this Official S tatell"Entin accordance with, and as a part of, thei r responsibi I i ti es to investorsunder the federal securitiesI aws as applied to the facts and ci rcumstances of this transaction, but the U nderwri ters do not guarantee the accuracyof completeness of such information. The information set forth herei n has been obtained from sources which are believed to be reliable. The informationand expressions of opinion herein are subject to change without notice and neither the delivery of this Official Statell"Ent nor any sale made hereunder shall, under any circumstances, create any implication that there has been no change in the affairs of the Corporation or any other parties described herein since the date hereof. All summaries of the Indenture, Ground and Facilities Lease, the Project Docu!l"Entsor other docu!l"Entsare madesubject to the provisions of such docu!l"Ents respectively and do not purport to be complete state!l"Ents of any or alI of such provisions. Reference is herebyt made to such docu!l"Ents on file with the Corporation for further informationin connection therewith. IN CONNECTION WITH THE OFFERING OF THE SERIES 2002 BONDS, THE UNDERWRITERS MAY OVERALLOT OR EFFECT TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF SUCH SERIES 2002 BONDS AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME. THE BONDS HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, IN RELIANCE UPON AN EXEMPTION CONTAINED IN SUCH ACT. THE SERI ES 2002 BONDS HAVE NOT BEEN REGISTERED OR QUALi Fl ED UNDER THE SECURITIES LAWS OF ANY STATE. TABLE OF CONTENTS Page

INTR ODUCTI ON ...... 1 The Corporation...... 1 Purposesof the Seri es 2002 Bonds...... 1 Save Mart Center ...... 2 The Seri es 2002 Bonds...... 2 Security for the Seri es 2002B onds ...... 2 Risk Factors ...... 3 Update of Certain Information Si nee the Date of the Preli rrinary OfficialS taterrEnt...... 3

THE CORPORATION ...... 3 General ...... 3 Governance...... 4 ManagerrEnt ...... 5 Summary of Corporation'sOther B usiness ...... 6

SAVE MART CENTER ...... 6 Generally ...... 6 Current Status of Major Perrrits and Approvals...... 6 Save Mart Center Construction ...... 6 Save Mart Center Operations...... 10 Event Center Project Revenues...... 10

SAVE MART CENTER COSTS AND PLAN OF FINANCE ...... 14

ESTIMATED SOURCES AND USES OF FUNDS...... 15

ESTIMATED DEBT SERVICE SCHEDULE ...... 16

REPORT OF FEASIBILITY CONSULTANT ...... 16 ProjectedEvent Center Project Revenues, Expenses and Debt Service Coverage...... 17 Market Area Analysis ...... 18 Competitive and Comparable Facilities/fenants...... 19 Financial Analysis ...... 21 ConeI usi on ...... 22

THE SERIES 2002 BONDS ...... 23 Description of the Series 2002 Bonds ...... 23 Redemption of the Series 2002 Bonds...... 24

SECURITY FOR THE SERIES 2002BONDS ...... 27 Pledge of Event Center Project Revenues...... 27 Event Center Project Revenues ...... 27 Rate Covenant...... 28 Reserve Accounts ...... 29 Capitalized I nterest Accounts ...... 29 The Ground Lease ...... 29 Deposit of Event Center Project Revenues...... 30 FION of Funds ...... 31 TABLE OF CONTENTS (continued) Page

Surplus Account ...... 33 Additional Senior Bonds ...... 33 Certain Financial Covenants...... 34 THE CALIFORNIA STATE UNIVERSITY, FRESNO ...... 34 General Description ...... 34 Student Enrol I rnent ...... 3 5 CampusPrograms and Services...... 35 CampusFaci lities ...... 36 RISK FACTORS ...... 37 Construction Risks ...... 3 7 Operational Risks ...... 40 Financial Risks ...... 41 Miscel I aneous Risks ...... 42 FORWARD LOOKING STATEMENTS ...... 44 CONTINUING DISCLOSURE ...... 44 LITIGATION ...... 44 LEGAL MATIERS ...... 45 TAX MATTERS ...... 45 UNDERWRITING ...... 46 RATINGS ...... 46 ADDITIONAL MA TIERS ...... 47

APPENDIX A - FEASIBILITY REPORT ...... A-1 APPENDIX B - SUMMARIES OF CERTAIN PROVISIONS OF THE INDENTURE AND GROUND LEASE ...... 8-1 APPENDIX C - SUMMARY OF CONSTRUCTION CONTRACT ...... C-1 APPENDIX D - FORM OF OPINION OF BOND COUNSEL ...... D-1 APPENDIX E - INFORMATION CONCERNING DTC...... E-1 APPENDIX F - FORM OF CONTINUING DISCLOSURE AGREEMENT ...... F-1

ii OFFICIAL STATEMENT

$69,475,000 $5,000,000 CALIFORNIA STATE UNIVERSITY, FRESNO ASSOCIATION, INC. CALIFORNIA STATE UNIVERSITY, FRESNO ASSOCIATION, INC. AUXILIARY ORGANIZATION EVENT CENTER REVENUE BONDS, AUXILIARY ORGANIZATION EVENT CENTER SUBORDINATE SENIOR SERIES 2002 REVENUE BONDS, SUBORDINATE SERIES 2002

The descriptions and sumraries of various docurrents herein set forthdo not purportto be corrprehensive or definitive, and reference is rmde to each docurrent for the corrplete details of all terrr6 and conditions. All staterrents herein regarding any such docurrent are qualified in their entirety byt reference to such docurrent. See "APPENDIX B - SUMMARIES OF CERTAIN PROVISIONS OF THE INDENTURE AND GROUND LEASE -Certain Definitions'' for definitions of certain words and terrr6used herein which are not otherwise defined herein. INTRODUCTION The purpose of this Official S taterrent is to provide certain inf ormati on concerning the $69,475,000 aggregate principal arrount of Auxiliary Organization Event Center Revenue Bonds, Senior Series 2002 (the "Senior Series 2002 Bonds") and the $5,000,000 aggregate principal armunt of A uxiIi ary Organization Event Center S ubordinate Revenue B onds, Subordinate Series 2002 ( the "Subordinate Series 2002 Bonds," and, together with the Senior Series 2002 Bonds, the "Series 2002 Bonds") to beissued bytthe California State University, Fresno Association,Inc. (the "Corporation"). The Corporation The Corporationis a California nonprofit public benefit corporation, organized in 1961 under the Nonprofit Public Benefit Corporation Law of the State of California with the pcMters to, arrong other things, prormte and assist i n carrying out the educational services of the California State University, Fresno (the "Campus") byt making expenditures for the acquisition and maintenance of real property comprising part of the Campus and the erection or parti cipati on in the erection of buildings on the Campus. In addition, the Corporation is an auxiliaryorganization of The California State University ("CSU") and is authorized to perform certain services pursuant to the California Education Code and regulations promulgated thereunder. See the caption "THE CORPORATION - General." Purposes of the Series 2002 Bonds The proceeds of the Series 2002 Bonds, are to be used to (i) finance the construction of a multi-purposeevents center on the campus of the California State University, Fresno, to be knCMtnas "Save Mart Center," (ii) fund capitalized interest on the Series 2002 Bonds, (iii) fund reserve accounts and (iv) pay the costs of issuing the Series 2002 Bonds. See the caption "ESTIMATED SOURCES AND USES OF FUNDS." Save M art Center Save Mart Center will be a multi-purpose event center located on the campus of California State University, Fresno. Components of Save Mart Center will include (i) approximately 16,000 spectator seats; (ii) 32 private suites; (iii) 1,108 Arena Builder Seats or club seats; (iv) a private club level concourse; (v) lockerrooms; and (vi) athletic training facilities. Save Mart Center will be located on approximately 48 acres located east of the main academic campus. The site is located off Shaw Avenue adjacent to a newly completed interchange for State Route 168. The site is unimprcwed and is currently CMtned bythe Campus. The site wi11 be leasedto the Corporationpursuant to a ground lease. Save Mart Center is expected to be the holl"Eto certain Campus athletic events including the Fresno State ll"En's and woll"En's basketball teams. Save Mart Center is also expected to serve the entire San J oaquin ValI e.; region as a venue for athletic, cultural and entertai nll"Ent events. See the caption "SAVE MART CENTER." The Series 2002 Bonds The Series 2002 B onds wi11 be issued under an I ndenture ( the "I ndenture"), dated as of January 15, 2002, between the Corporation and U.S. Bank, N.A., as trustee (the "Trustee"). The Corporation and the B oard of Trustees of the Cal i forni a State U niversi ty ( the "CSU Trustees") wi 11 enter into a Ground Lease, datedas of October 1, 200 1 ( the "Ground Lease"), pursuant to which the Corporation will lease the site on the Campus on which Save Mart Center is to be located. See "APPENDIX B - SUMMARIES OF CERTAIN PROVISIONS OF THE INDENTURE AND GROUND LEASE." In certai n circumstances the Corporation may issue Additional Senior B onds and Additional Subordinate Bonds under the Indenture, payable from the Event Center Project Revenues, having a Iien on the Trust Estate and ranki ng on a parity with the Senior Series 2002 B onds and the Subordinate Series2002Bonds, respectively. See the caption"SECURITY FOR THE SERIES 2002 BONDS - Additional Senior Bonds." The Series 2002Bonds and anyAdditional Bonds issued and outstanding under the Indenture are referredto colI ectively herein as the "Bonds." Security for the Series 2002Bon ds Pursuant to the Indenture, the Corporationwill grant to the Trustee as securityfor payll"Entof the principal of, and interest and premium on the Bonds, a security interest in, and pledge and set ewer to the Trustee in trust for the benefit of the holders of the Bonds, the Trust Estate, incl udi ng Event Center Project Revenues earned or received by the Corporation, the Corporation's interest in the Bulldog Foundation MOU, dated as of January 31, 2002, by and betweenthe Corporationand the Bul Idog Foundation (a Campus alumni fund raisi ng organization, hereinafter referred to as the "Bulldog Foundation"), the Student Seating Purchase Agreell"Ent, dated as of January 1, 2002, by and between the Corporation and the CSU Trustees, certain Project Docu!l"Ents, including various sponsorship agree!l"Entsdetailed under the caption "SAVE MART CENTER - Event Center Project Revenues," the Ground Lease, as secured bythat certain Leasehold Deed of Trust with Assignll"Ent of Rents and Fixture FiIi ngs, datedas ofJ anuary 15, 2002, bythe Corporation, as trustor to a trustee, as trustee for the benefit of the Trustee, as beneficiary( the " Deed of Trust''), interest or profits from the i nvestll"Ent of certain funds under the Indenture, revenues received by the Corporation from the

2 sale of seats at Save Mart Center, including luxury suites, arena builder seats and personalseats, and revenue receivedfrom the sale of tickets, concessions and novelties at Save Mart Center, all as more particularly described herein. See the caption "SECURITY FOR THE SERIES 2002 BONDS - Event Center Project Revenues." The Indenture imposescertain restrictions on the actions of the Corporation for the benefitof the holders of the B onds incl udi ng, among other things, restrictions on the sale or exchange of any property constituting part of the Trust Estate, restrictions on the incurrence of additional Indebtedness and provisions governi ng the establ ishrrEnt of rates, fees, prices for goods and services and charges. See "APPENDIX B - SUMMARIES OF CERTAIN PROVISIONS OF THE INDENTURE AND GROUND LEASE." Risk Factors AN INVESTMENT IN THE SERIES 2002 BONDS INVOLVES SIGNIFICANT RISKS. SEE THE CAPTION "RISK FACTORS" HEREIN FOR A DISCUSSION OF CERTAIN RISK FACTORS THAT SHOULD BE CONSIDERED IN CONNECTION WITH AN INVESTMENT IN THE SERIES 2002 BONDS. Update of Certain Information Since the Date of the Preliminary OfficialStatement This Official StaterrEnt includes certain changes since the date of the Preliminary Official StaterrEnt. These include changes (a) under the caption "INTRODUCTION - The Series 2002 Bonds" to reflect the final date of the Ground Lease, (b) under the caption "INTRODUCTION - Security for the Seri es 2002 Bonds'' to reflect the final date of the Bul I dog Foundation MOU , (c) under the caption "SAVE MART CENTER - Event Center Project Revenues'' to clarify the sponsorship arrangerrEnt with IBM, (d) under the caption "RISK FACTORS - Financial Risks" to cross-reference a description of the rrEchanics associated with a draw upon the Reserve Accounts, (e) under the caption "CONTINUING DISCLOSURE" and in APPENDIX F - FORM OF CONTINUING DISCLOSURE AGREEMENT to reflect that the Continuing Disclosure AgreerrEnt will require the Corporation to file the Annual Report within 180 days follONing the end of the Corporation's Fiscal Year, and disclosing that the Corporation's first annual report required to be filed with respect to those certain California State University, Fresno Association, Inc., Auxiliary Organization Refunding Revenue Bonds (Student Residence Project), Series 2001 due onJanuary 1, 2002 was filed on January 31, 2002, and (f) in APPENDIX B - SUMMARIES OF CERTAIN PROVISIONS OF THE INDENTURE AND GROUND LEASE" to reflect that interest earnings on arrnuntsdeposited in the Surplus Account wi 11 bedeposited i n the S ubordinate I nterest Account. THE CORPORATION General The Corporation is a California nonprofit public benefit corporation located in the State of California operating under the Nonprofit Public Benefit Corporation Law of the State of California. The Corporation was originally organized in May 1961 under the narrE "Fresno State College Association, Inc." On May 28, 1975, the Corporation arrEnded its Articles of Incorporation to becorrE the California State U niversi ty, Fresno Associ ati on, Inc. The Corporation is also an auxiliary organization of CSU and is authorized to performcertain services pursuant to the California Education Code, Sections 89900 et seq. (the "Education Code"), and the California Code of

3 Regulations, Title 5, Sections 42400 et seq. (the " Regulations"). The Internal RevenueService has determined that the Corporation is exempt from federal inco!l"E taxation by vi rtue of being an organization described in Sections 501 (a) and 501 (c) (3) of the Internal Revenue Code of 1986, as all"Ended (the "Code''). The Corporation is not a private foundation because it has been determined to be apublic charity pursuant to Section 509(a) of the Code. Pursuant to its articles of incorporation (the "Articles of Incorporation"), the Corporation is organized and for!l"Edto prorroteand assist the educational services bymaking expenditures for any one or rrore of the accepted functions of the Campus including, but not limited to, expenditures for acquisi tion and maintenance of real property comprisi ng part of the Campus area, the erection or participationin the erection of Campus buildings, the operationof a general bookand supply store to provide for the needs of the Campus, the operation of Campus food services with alI types of services, the operationof the Student Union with the necessary programsand activities, the operation of student housing facilities, and any other accepted activity of an auxiliary organization of the California State University system. It is the nission of the Corporation to prorrote and assist the educationalservices of the Campus. Presently, the Corporation manages all of the com!l"Ercial business of the Campus through four main operating units. These operating units are the Kennel Bookstore, University Food Services, UniversityStudent Union and UniversityCourtyard. Governance The Corporationhas no !l"Embers. The affairs of the Corporationare governedby a B oard of Directors (the "Board") comprised of nine directors. Pursuant to the Bylaws of the Corporation, the follONing are required to be !l"Embers of the Board: the Vice President for Administration of the Campus, twodesignees of the President of the Campus selected from the Division of Student Affairs, the Vice President of Student Affairs of the Campus or designee, a !l"Ember of the Academic Assembly nominated bythe Academic Senate of the Campus and elected bythe Board, the President of the AssociatedStudents of the Campus, provided such personhas attained the age of twenty-one years (or designee thereof who has attained the age of twenty-one years), the Executive Vice President of the Associated Students of the Campus, provided such person has attained the age of twenty-one years (or designee thereof who has attained the age of twenty-one years), a non-campus person noni nated by the President of the Campus and elected by the B oard, and the Chair of the Academic Senate of the Campus (who servesas an ex-officionon-voting !l"Ember of the Board). No !l"Ember of the Board is to receive compensation for serving on the Board, except that actual and necessary expenses which are incurred in the discharge of a !l"Ember's duties as such and as approvedby the Board maybe paid.

4 The present na!l"Es, Campus relationship, length of service as Board !l"Embers and terms of the current Board !l"Embersare set forth belCMt. Board of Directors Members

Current Nall"E University Relationship Term Ends J all"ESAldredge Memberof the Academic Assembly 9/15j{)2 Vacant President's Desi gneefrom Student Affairs Virtue of Position William Fasse Chair of the Academic Senate Virtue of Position RyanJ acobsen President, AssociatedStudents Virtue of Position Maxine McDonald President's Desi gneefrom Student Affairs Virtue of Position Jamie Mello Vice President, AssociatedStudents Vi rtue of Position Benjamin F. Quillian Vice President for Administration Virtue of Position R. Gary Renner Non-Campus Person 9/15j{)2 J udy Sakaki Vice President for Student Affairs;Deanof Students Virtue of Position

The Chairman of the Board is Dr. Benjamin F. Quillian, Dr.Judy Sakaki is the Vice Chair. Dr.J all"Es Aldredge is the Secretary and Treasurer of the Corporation. Pursuant to its Bylaws, the Corporation has established the follCMting three standing committees of the Board: the Executive Committee; the Bookstore Advisory Committee; and the Food Services Committee. The Board has also established the University Student Union Board to assist in managing and operating the Student Union. The Executive Comnittee takes action when necessary on behalf of the Board, does long-range planning for the Corporation and generally oversees the ongoi ng operations of the Corporation. The other committees have been established to assist the Board in, among other things, developing policies and reviewing, developing and recom!l"Ending budgets for their respective operations. U nless otherwise delegated, final decision­ making authorityis with the B oard. The Corporation hasduly adopted a resolution approving the sale and issuance of the Series 2002B onds, as descri bedin this OfficialS tatell"Ent. Management The Corporation is generally managed by Deborah S. Adishian-Astone, Executive Director. Ms. Adishian-Astone has served as Executive Director of the CorporationsinceJ une, 200 1. Prior to assuming this position, Ms. Adishian-Astone was the Assistant to the Vice President for Administration and Save Mart Center Coordinator. Ms. Adishian-Astonealso served as the Campus Director of Facilities Planning. She has been with the Campus for over 13 years and has been involvedwith many aspects of Campus developll"Ent. As Executive Director, she is responsiblefor various units within Auxiliary Services that includes University FoodServices, the Kennel Bookstore and Save Mart Center. Ms. Adishian-Astone received a bachelor's degree in business administration and a master's degree in business administration from the Campus. Ms. Adishian-Astone'sprofessional affiliations include the Societyof College and UniversityPlanners and the UrbanLand Institute.

5 Summary of Corporation's Other Business

The four main operating units of the Corporation are University Courtyard (student housing), Kennel Bookstore, U niversi ty Food Services and U niversi ty Student U nion. Other than amounts available pursuant to the Student Seating Purchase Agreement, the income of the Corporation derived from such operations is not avaiI able as security for the Series 2002 Bonds.

SAVE MART CENTER

Gener ally

Save Mart Center will be a multi-purpose event center located on the campus of California State University, Fresno. Components of Save Mart Center will include (i) approximately 16,000 spectatorseats; (ii) 32 private suites; (iii) 1,108 Arena Builder Seats or club seats; (iv) a private club level concourse; (v) lockerrooms; and (vi) athletic training facilities.

Save Mart Center will be located on approximately 48 acres located east of the main academic campus. The site is located off Shaw Avenue adjacent to a newly completed interchange for State Route 168. The site is unimproved and currently CMtned by the Campus. The site will be Ieased to the Corporation pursuant to the Ground Lease.

Save Mart Center wi11 be the home to Fresno State athletic events including the Fresno State men's and women's basketball teams. Save Mart Center will also serve the entire San Joaquin Val Ie.; region as a venue for athletic, cultural and entertainment events.

Current Status of Major Permits and Approvals

All relevant California environmental review statutes and regulations relating to the construction of Save Mart Center have been complied with. All discretionary approvals necessary to commence construction and to operate Save Mart Center once it has been constructed have been received bythe Corporation.

A varietyof ministerial pernits and approvals will be required from the State, the County and other governmental authorities to construct and operate Save Mart Center. Other than certain trade permits enumerated in the Construction Contract (as defined belCMt), the Corporation will be responsible for obtaining all permits and approvals in accordance with CSU policy. The Corporation currently anticipates receiving all such permits and approvals in a timely manner. Copies of all permits and approvals obtained for Save Mart Center are available from the Corporation.

Save Mart Center Construction

General. The Corporation has entered into the California State University, Fresno Association, Inc. CM JGC Agreement (the "Construction Contract'') with The Clark Construction Group, Inc. (the "Construction Contractor") which provides for the construction of Save Mart Center.

Construction Contract. Pursuant to the Construction Contract, the Corporation will pay to the Construction Contractor a guaranteed maximum price of $85,965,000 (the "GM P") as total compensation for construction of Save Mart Center, subject to adjustment only as specified therein. The GM P does not i ncl ude costs associated with the acqui si tion and i nstal Iati on of seats at Save Mart Center. The cost of acquisition and installation of seats will be paid for from other mone.;s, as

6 described under the caption "SAVE MART CENTER COSTS AND PLAN OF FINANCE." The GMP also does not include costs associated with the acquisi ti on and instal I ati on of a scoreboard at Save Mart Center. The Corporation is currently negotiating a sponsorship arrangement which involves acquisition and installation of a scoreboard. In the event that a sponsorshiparrangement for the scoreboard is not completed, the Corporation expects to use other Corporation moneysto pay for the acquisition and installation of the scoreboard. The cost of the acquisition and installation estimated byt the Corporation to be approximately $600,000. The Construction Contractor has furnished to the Corporation payment and performance bonds with respect to the obligations of the Construction Contractor under the Construction Contract. See APPENDIX C - "SUM MARY OF CONSTRUCTION CONTRACT." Pursuant to the Construction Contract, the Construction Contractor has agreed to substantially completeSave Mart Center byt November15, 2003 (the "Completion Date") provided that the notice to proceed is given to the Construction Contractor bytJanuary 31, 2002. The notice to proceed is expected to be delivered on or aboutthe date the Series 2002 Bonds are delivered. The Corporationwi 11 haveno obi igati on to extend the Campi etion Date, and the Construction Contractor has agreed that it will not be relieved of its obligation to complete Save Mart Center byt the Completion Date except as extended in accordance with the Construction Contract. The Construction Contract providesfor the assessmentof liquidated damagesequal to $2,000 per day for each dayafter the Completion Date that Save Mart Center is not complete. If Save Mart Center is still not completed 730 days after the notice to proceedis given, the Construction Contract provides for the assessment of liquidated damages equal to $15,000 per day thereafter, until completion is achieved. The Construction Contractor. The Construction Contractor was founded in 1906 and is currently one of the most experienced general contractors in the United States, with annual revenues of approximately $2 bi11 ion. Headquartered i n Bethesda, Maryland, the Construction Contractor has eight regional officesI ocated to servethe needs of clients throughout the U ni ted States. The Construction Contractor is a diversified contractor with the ability to meet the needs of clients on a variety of project types, including new construction and renovation of sports facilities, convention centers, performing art centers, hotels, retaiI centers, office buiI di ngs, heal th care facilities, educational facilities, laboratories, multi-family residential housing, airports, rail stations, correctional institutions, water treatment plants, manufacturing plants, and heavy ;highway projects. Such projects have been successfully completed bytthe Construction Contractor for both public and private clients under a variety of project delivery methods, including general contracting, construction management, and design;build arrangements. The follONing projects have been completed bytthe Construction Contractor: • Indian Wel Is Tennis Gardens (TournamentTennis Center), Indian Wel Is, California

• FedEx Field, Landover, Maryland

• MCI Center, Washington, DC

• PSI Net Stadium for the Baltimore Ravens (General Contractor for Concrete Foundations and Structural Concrete), Balti more, M aryl and

7 • Cleveland B rCMtns Football Stadium (as a Development & Preconstruction Consultant), Cleveland, Ohio

• Campus RecreationCenter, University of Maryland, College Park, Maryland

• Byrd Stadium Improvements, Universityof Maryland, College Park, Maryland

• Robert TrentJones Golf Club, Lake Manassas, Virginia

• Oriole Park at CamdenYards, Baltimore, Maryland • LansdCMtneConference Resort and Golf Club, Leesburg, Vi rgi ni a

• William H.G. Fitzgerald Tennis Center, Washington, DC

• USAir Arena, Landover, Maryland

• Mi11 er Park (Memberof J oi nt Venture), Milwaukee, Wisconsin See the caption "RISK FACTORS - Construction Risks - Construction of Save Mart Center; Delay in Opening." Construction Monitor. The Corporation has engaged International Facilities Group as construction monitor (the "Construction Monitor'') under the Construction Contract and the Indenture. The Construction Monitor provides project rranagement servicesto a variety of professional sportsCMtners, municipalities, and Ienders. Servicestypically providedto the Construction M oni tor' s clients i ncl ude financial feasi biIi ty, rrarketi ng, financial analysis, stadi um design and construction oversight,faci Ii tycommi ssi oning, and operations. In a number of projects, the Construction M oni tor has beenretained bytthe clients to overseethe entire developmentof a project. The Construction Monitor or its personnelhave participated in development projects valuing morethan $3 billion, including the follCMtingpro jects:

• CorriskeyPark, Chicago, IL • United Center, Chicago, IL • ComericaPark, Detroit, MI • Miller Park, Milwaukee, WI • Great AmericanBall Park, Cincinnati, OH • SBC Arena, San Antonio, TX • AmericanAirlines Arena, Mi arri, FL • Conseco Fieldhouse, I ndianapol is, IN • Houston RocketsArena, Houston, TX • Florida Marlins Baseball Stadium, Miami, FL • Pepsi Center, Denver, CO • AmericanAirlines Center, Dallas, TX • Rose Garden, Portland, OR

8 • N01VColiseum, Nassau County,NY • Invesco Field, Denver, CO • Bi-lo Center, Greenville,SC • RaymondJ amesStadium, Tampa Bay, FL • Garden of Champions, I ndian W elIs, CA • Tucson ElectricPark, Tucson, AZ • Ed Smith Stadium, Sarasota, FL The Construction Monitor will oversee the activities of the Construction Contractor byt monitoring construction progress and ensuring that the Corporation is continually advised of the construction status. Specificactivities of the Construction M oni tor wi 11 beas folI ONs:

• Revi01Vinitial construction proceduresand processes. • Assist in developmentof proceduresto beused byt Construction Contractor to bid various phases of SaveMart Center.

• Revi01Vconstruction schedule updates for accuracyand reliability.

• Attend construction progressmeeti ngs.

• Revi01V construction drawings as they develop and monitor impact on schedule and budget.

• Revi01V proposal requests recommended byt architects and provide input to the Corporation.

• R evi 0/V cost estimates developed byt the Construction Contractor and provide input as needed.

• R evi 0/V alI proposed change order requests for fai rness and impact on budget and schedule.

• Assist the Corporation in the procurement of the necessary construction testing and inspection servicesand monitor results of all testing and inspection. • Work with the Corporationto coordinateoccupancy schedules.

• Assist in development of start-up pl ans, check-Hsts, etc. for ongoing operation of Save Mart Center and revi01V submitted operations and maintenance manuals, warranties and guaranteedfor materials and equipment. During the course of construction of Save Mart Center, the Construction Monitor will performthe reportingduties described belON on an ongoing basis and wi11 provide a monthlyreport to the Corporationand others. In such connection, the Construction Monitor will:

• Document and summarize the status of construction, progress to date and recommended payments.

9 • Provide an analysis of the current requisition including all materials, bills, receipts, invoices, etc. subnitted in connection therewith.

• Review any stored materials requests (on and off-site) and deternine if any disbursements should be madein respect thereof.

• Review construction progress to date and comment upon work completed to date in relation to the construction schedule.

• Review and comment upon al I change orders and determine whether or not to accept the same in accordance with the applicable agreements.

• Review the construction progress to date i n relation to the rernaini ng budget amounts( on line--by�ine and an aggregate basis) and render an opinion as to whether such remaining budget amounts are sufficient to complete construction of Save MartCenter.

• Providephotographs establishing the extent of construction progressand highlighting any significant issues.

• Review Construction Contractor's Ii en waiver Iogs or other compi Iati on of Ii en waivers and cooperate with the title insurance companyin connectiontherewith.

• Review all payment requisitions and make all determinations respecting whether or not any portionthereof should be paid.

• Upon substantial completion of Save Mart Center, submit a written report to the Corporation certifying that (i) in Construction Monitor's opinion construction has been substantially completed in accordance with the project plans, the Construction Contract and applicable agreements, (ii) Construction Monitor has received the architect's certificate of substantial completion and (iii) a certificate of occupancy for Save Mart Center has been issued.

Save Mart Center Operations

The Corporation currently intends to enter into an operations agreement with a private manager to manage and operate Save Mart Center, but will not select a manager before the issuance of the Series 2002 Bonds. Any operations agreement entered into byt the Corporation will comply with appl i cable federal tax rules and regulations.

Event Center Project Revenues

Copies of the various agreements discussed under this caption can be obtained, upon request, from the Corporation.

ExecutedSponsorship and Naming Rights Agreements.

Pepsi Agreerrent. In 1999, the Corporation entered i nto a Sponsorshi p and Nani ng Rights Agreement (the "Pepsi Agreement'') with Bottling Group, L.L.C. D;B/A The Pepsi Bottling Group ("Pepsi") wherebyt, in exchange for certain advertising, product availability, promotional

10 opportunities and naming rights with respect to Save Mart Center, Pepsi agreed to pay to the Corporation a fee of $40,CXX),CXX) less corrrnissions payable in installments through the first 23 years of Save Mart Center operations. The Corporation has already received $4,CXX),CXX) under the Pepsi Agreement. Upon the opening of Save Mart Center, Pepsi has agreed to make annual payments to the Corporation of approximately $1,565,217 for a term of 23 years. Pepsi has designated Save Mart Supermarkets as the nani ng party.

Cal Fed Ag reerrent. On November1 5, 2CXX), the Corporation entered into a Sponsorship Agreement (the "Cal Fed Agreement'') with California Federal Bank ("Cal Fed") whereby, in exchange for certain advertising rights and promotional opportunities through 2004 with respect to Save Mart Center, Cal Fed agreed to pay to the Corporation a sponsorship fee payable in i nstal Iments. Pursuant to the Cal Fed Agreement, the Corporation received $250,CXX) on January1, 2001, and Cal Fed has agreed to pay to the Corporation $500,CXX) on each of January1, 2002, January 1, 2003 andJanuary 1, 2004. At the option of Cal Fed, the advertising rights of Cal Fed with respect to Save MartCenter can be extended through 2006 in exchange for two additional $500,CXX) paymentsto the Corporation.

Kr oeker Agreerrent. The Corporation entered into a Sponsorship Agreement (the "Kroeker Agreement''), dated as of January1, 2001, with Kroeker, Inc. ("Kroeker'') whereby, in exchange for certain advertising rights and promotional opportunities with respect to Save Mart Center, Kroeker agreed to pay to the Corporation a sponsorship fee of $250,CXX) payable in installments. The first i nstal Iment of $35, 714 has al ready been paid to the Corporation. Subsequent i nstal Iments of $35, 714 are payable by Kroeker to the Corporation on each J anuary31 , commendng in 2002 and ending in 2007.

P ayrrents U nder Ag reerrents. For a discussion of the risks associated with sponsors fai Ii ng to make payment to the Corporation under the agreements described above, see the caption " RISK FACTORS - Failure to Realize Event Center Project Revenues. "

Pending Sponsorshipand Naning Rights Agreements.

Pac Bel I Ag reerrent. At or prior to the closing of the Series 2002 onds,B the Corporation expects to enter into a Sponsorship Agreement (the "Pac Bell Agreement'') with Pacific Bell Telephone Company (" Pac Bell") whereby, in exchange for certain sponsorship rights through 2007 with respect to Save Mart Center, Pac Bell will agree to pay to the Corporation a sponsorship fee payable in installments. Pac Bell already has paid the Corporation $1 50,CXX), and, pursuant to the Pac Bell Agreement, is expected to agree to pay to the Corporation $150,CXX) on each of October1, 2002, October 1, 2003, October 1, 2004 and October1, 2005. At the option of Pac Bell, the sponsorship rights of Pac Bell with respect to Save Mart Center can be extended through 2010 in exchangefor five additional $150,CXX)pa yments to the Corporation.

Comnmity MOU. The Corporation entered into a Memorandum of Understanding (the "Community MOU"), dated August 23, 2001, with Community Medical Centers ("CMC") whereby the parties agreed i n pri nci pal to negotiate an agreement ( the "CMC Agreement") under which CMC will pay the Corporation for certain business development and promotional rights with respect to Save MartCenter. CMC has already made a "goodfa ith" payment to the Corporation in the amount of $20,CXX). The Corrrnunity MOU sets forth that the final agreement negotiated by the parties shall provide for a total payment by CMC to the Corporation of $1 .5 million with payments to commence

11 no later than October1, 2003. The Corporation anticipates entering into the CMC Agreement by March 30, 2002.

IBM Ag reerrent. The Corporation anticipates that the Campus will enter into an agreement with IBM ("IBM") on or prior to the closing of the Series 2002 Bonds (the "IBM Agreement''), whereby, in exchange for certain sponsorship rights and prorrotional rights, I B M wi11 pay to the Campus approximately $25,000 per year through 2010. The IBM Agreement will be terminable at will by either party thereto with 60 days notice. The Corporation expects that the Campus, in turn, wi11 agree to pay the Corporation $25,000per year through 2010, irrespective of whether arrountsare paid to the Campus under the I B M Agreement.

P ayrrents U nder Agreerrents. For a discussion of the risks associated with the faiI ure by the Corporation to consummate the agreements described above and the fai Iure of sponsors to make payments to the Corporation thereunder, see the caption "RISK FACTORS - Failure to Realize Event Center Project Revenues."

Seat Licenses.

Arena Builder Licenses. Pursuant to Arena Builder Seat License Agreements (the "Arena Builder Licenses''), licensees may advance purchase from the Corporation licenses for individual seats or groups of seats at Save Mart Center for Campus events. The majority of Arena Builder Licenses have a term of ten years and are payable in three instal Iments, the fi rst being due at seat selection, the second earri ng due on J une 30, 2002, and the third coming due on J une 30, 2003. Of the available 1,108 Arena Builder Licenses, 940 have already been sold and $6,960,280 had been received with respect to such purchases as of June 30, 2001. The Corporation expects to have sold al I the avaiI able Arena B ui Ider Licenses prior to the opening of Save Mart Center.

LuxurySu ite Licenses. Pursuant to Preferred Seating License Agreements (the " LuxurySuite Licenses"), the Corporationis offering the use of luxurysuites at Save MartCenter for various events for terms of five, seven or ten years. Annual fees for Luxury Suite Licenses range from $45,000 to $60,000. 2o>/o of such annual fee is due uponthe purchase of a Luxury SuiteLicense and the balance is payable no later than 12 rronths prior to the opening of Save Mart Center. Thereafter, annual payments wi11 be due to the Corporation no Iater than J anuary 31 of each year. Of the 32 avai Iable Luxury Suite Licenses, 30 have already been sold and $854,860 had been received with respect to such purchases as of June 30, 2001. TheCorporation expects to have sold all the available Luxury Suite Licenses prior to the opening of Save Mart Center.

Personal Seat Licenses. Pursuant to Personal Seat License Agreements (the "Personal Seat Licenses''), the Corporation is offering the use of individual seats at Save Mart Center for various events for a term of ten years. Personal Seat Licenses are payable in three installments, the first installment being due at seat selection, the second coming due on June 30, 2002, and the third coming due on J une 30, 2003. Of the available 11,076 Personal Seat Licenses, 8,495 have already been sold and $3,489,17 1 had been received with respect to such purchases as of June 30, 2001. The Corporation expects to have sold 5o>/o of the remaining available Personal Seat Licenses prior to the opening of Save Mart Center.

P ayrrents U nder Seat Licenses. For a discussion of the risks associated with the fai Iure by the Corporation to sel I the remaini ng seat Ii censes described above and the fai Iure of seat Iicensees to

12 make payments to the Corporation thereunder, see the caption "RISK FACTORS - Failure to Realize Event Center Project Revenues." Bulldoq Foundation. The Bulldog Foundation has agreed pursuant to the Bulldog Foundation MOU, to make payments to the Corporation in an annual arrount not to exceed $1,375,000. The obligation of the Bulldog Foundation to make such payments under the Bulldog Foundation MOU to the Corporation shall continue until the Series 2002 Bonds are paid in full. Fai I ure by the Bul I dog Foundation to make payments due to the Corporation under the B ulI dog Foundation MOU could have a material adverse effect on the ability of the Corporation to pay debt serviceon the Series 2002B onds. Student Union Surplus Revenues. Pursuant to a Student Seating Purchase Agreement, dated as of J anuary 1 , 2002, by and between the Corporation and the CSU Trustees, the CSU Trustees agreed to pay the Corporation $300,000 each year in exchange for 2,000 seats at Save Mart Center for events. The CSU Trustees will make such payments from student union fees collected by the CSU Trustees from students at the Campus (the "CSU Fresno Student Union Fees"). The CSU Trustee's purchase obi i gati ons are payable from CSU Fresno Student U ni on Fees and are junior and subordinate to certain indebtedness of the CSU Trustees, namely, the California State University, Fresno State Student U nion Revenue B onds, Seri es B , currently outstanding in an aggregate princi pal arrount of $4,540,000, and issued pursuant to a Resolution of the CSU Trustees, adopted on May 26, 1971 and amended by a First SupplementalResolution of the Board adopted on May 10, 1995. Other Revenues. EventCenter ProjectRevenues will also include other revenues received by the Corporation relating to Save Mart Center, including (i) rroneys received through private fundraising, (ii) rroneys projected to be collected from future tenants of Save Mart Center, (iii) rroneys projected to be received from the future sale of signage and advertising rights with respect to Save Mart Center, and (iv) rroneys projected to be collected from the sale of seats, concessions and novelties at Save Mart Center. Failure to receive such revenues could have a material adverse effect on the ability of the Corporation to pay debt service on the Series 2002 Bonds.

13 SAVE MART CENTER COSTS AND PLAN OF FlNANCE

The total cost of Save Mart Center is estimated by the Corporation to be approximately $95,612,000. The follONing is a description of the various components of Save Mart Center and their estimated costs:

Guaranteed Maximum Price Under Construction Contract $ 85,965,000

Architect Fees $ 2,240,000 Project Management 1,227,000 Materials Testing & Inspecti on 481,800 B ui Ider' s Risk Insurance 248,200 Inspector of Record 300,000 Plan Check Feest,eisrri c Peer Review 150,000 Owner Contingency 2, 000,000 Owner DevelopmentCosts 1 ,000, 000 Fixtures, Furnishings & Equipment(I ncludes Seats) 2,000, 000 Total Project Costs: $ 95,612,000

Source: The Corporation As shONn above, $85,965,000of the total estimated costs described above are included in the GMP under the Construction Contract. $9,647,000 of the total estimated costs described above are not i ncl uded i n the GM P under the Construction Contract. Total project costs wi11 be paid for with the proceeds of the Series 2002 Bonds, payments to be received by the Corporation from sponsorships and narring rights agreements, seat Iicenses and private f undrai sing. See the caption "ESTIMATED SOURCES AND USES OF FUNDS." Costs of approximately $600,000 associated with the acquisition and installation of a scoreboard at Save Mart Center are not included in the estimated costs shONn above. The Corporation expects to pay such costs from the proceeds of future sponsorship or other Corporation moneys. See the caption "SAVE MART CENTER - Save Mart Center Construction."

14 ESTIMATED SOURCES AND USES OF FUNDS

The follONing is an estirrate of the sources and uses of funds in connection with the financing of Save Mart Center.

Esti rratedSources of Funds: Senior Series 2002B onds $ 69,475,000 Senior Series 2002Bonds Net Original Issue Discount (334,878) Subordinate Seri es 2002 B onds 5, 000,000 SubordinateSeries 2002 Bonds Original Issue Discount (180,687) Seat Licenses, Sponsorships and Naming Rights, and Private Fundraising (l) 36,809,706 Interest Earni ngs 2,075,345 A cc rued I nterest 349,617 TOTAL $113, 194,103

Esti rrated U ses of Funds: Construction Costs(2) $ 95,612,000 3 Capitalized Interesf ) 9,041,823 DebtService Reserve Accounts 6,616,867 (4 Costs of Issuance ) 1.923.413 TOTAL $113, 194,103

(l) Proj ected revenues during construction and the appl ication of such revenues from Seat Licenses, Sponsorships and Narri ng Rights, and Private Fundraising are presented below. Collected armunts are as of June 30, 2001 . Committed armunts reflect executed or pending agreements. For detaia led description of revenuesexpected to be received during construction, see Section V of the Feasi bil ity Reportattac hed as AppendixA - Feasibi lity Report tothis Official Statement.

Projected Revenues During Construction:

Source Projected Collected Comrritted Unsold Luxury Suites $ 1,565,000 $ 854,860 $ 620, 140 $ 90,000 Arena B ui lder Seats 16, 780,000 6,960,280 7,299,720 2,520,000 Personal Seat Licenses 12,572,349 3,489, 171 8, 577,528 505,650 Sponsorship and Naming Rights 1,828,648 1,828,648 0 0 Sponsorships and Private Fundraisi ng 8,778,309 3,987,651 4,790,658 Q TOTAL $41.524.306 $17.120.610 $21.288. 046 $3.11 5.650 Applied to Construction Costs $36,809,706 Applied to Surpl us Account 4,714,600

Source: Corporation <2) Includes pay mentsdue to the Construction Contractor pursuant to the Construction Contract. <3) I ncludes capital ized interest to February 15, 2004and accrued interest. <4) Includes the Underwriters' di scount, legal fees and certai n other fees, costs and expenses.

15 EST IMATED DEBT SERVICE SC HEDULE

The folI CMti ng table sets forth the annual debt servicearrnunts for the Series 2002B onds.

Principal Maturity Principal Maturity Annual or Mandatory Interest on or Mandatory Interest on Period Redemption on Senior Redemption on Subordinate Total Debt Ending Senior Series 2002 Series 2002 Subordi nate Series 2002 Service July 1 Bonds Bonds Seri es 2002Ban ds Bonds Requirements 2002 $ $ 1,842,571 $ $ 158,686 $ 2,001,257 2003 3,995,938 344, 138 4,340,075 2004 1,860,000 3,995,938 65,000 344, 138 6,265,075 2005 1,125,000 3,902,938 70,000 339,750 5,437,688 2006 1,310,000 3,846,688 75,000 335,025 5,566,713 2007 995,000 3,781,188 80,000 329,963 5, 186, 150 2008 975,000 3,733,925 85,000 324,563 5,11 8,488 2009 945,000 3,690,050 90,000 318,825 5,043,875 2010 950,000 3,645, 163 95,000 312,750 5,002,913 2011 1,185,000 3,597,663 100,000 306,338 5,189,000 2012 3,860,000 3,538,413 110,000 299,588 7,808,000 2013 4,105,000 3,345,413 115,000 292,163 7,857,575 2014 4,005,000 3,1 29,900 125,000 284,400 7,544,300 2015 1,260,000 2,889,600 130,000 275,963 4,555,563 2016 1,510,000 2,814,000 140,000 267, 188 4,731, 188 2017 1,400,000 2,723,400 150,000 257,738 4,531, 138 2018 1,440,000 2,639,400 160,000 247,613 4,487,013 2019 1,555,000 2,553,000 170,000 236,813 4,514,813 2020 1,600,000 2,459,700 180,000 225,338 4,465,038 2021 1,965,000 2,363,700 195,000 213, 188 4,736,888 2022 4,710,000 2,245,800 210,000 200,025 7,365,825 2023 5,060,000 1,963,200 220,000 185,850 7,429,050 2024 5,310,000 1,659,600 240,000 170,450 7,380,050 2025 2,755,000 1,341,000 255,000 153,650 4,504,650 2026 3, 150,000 1, 175,700 270,000 135,800 4,731,500 2027 2,230,000 986,700 290,000 116,900 3,623,600 2028 2,315,000 852,900 310,000 96,600 3,574,500 2029 2,480,000 714,000 335,000 74,900 3,603,900 2030 2,575,000 565,200 355,000 51,450 3,546,650 2031 6,845,000 410,700 380,000 26,600 7,662,300 $69,475,000 $76,403,384 $5,000,000 $6,926,386 $157,804, 769 Totals maynot add due to rounding.

REPORT OF FEASIBILITY CONSUL TANT

Economics Research Associates (the "Feasibility Consultant'') was retained byt the Corporation in February 2001 to perform an analysis of various aspects of the proposed Save Mart Center. The Feasibility Consultant has prepared Save Mart Center Feasibility Study dated J anuary 16, 2002 (the " Feasi bi Iity Report")attached as Appendix A to this Official Statement. The FeasibilityReport contains analyses of (i) market demand for Save Mart Center, (ii) competitive and comparable facilities to Save Mart Center and proposed tenants of Save Mart Center, and (iii) the financial feasibility of Save Mart Center.

16 Projected Event Center Project Revenues, Expenses and Debt Ser vice Coverage The table belCMt sets forth the projected Event Center Project Revenues, Operation and Maintenance Costs and Debt Service Coverage with respect to Save Mart Center for the Corporation's fiscal years 2004through 2008. Actual Event Center Project Revenues, Operation and Maintenance Costs and Debt Service Coverage wi II vary from the projections presented belCMt and such variations may be material. Dollar amounts are presented in thousands of dollars. For a detailed description of revenues expected to be received during construction of Save Mart Center, see Section V of the Feasibility Report attachedas APPENDIX A - FEASIBILITY REPORT" to this OfficialStatement. REVENUES 2004 2005 2006 2007 2008 Event-RelatedRev enues Athletic Tenant(s) $ 250 $ 250 $ 250 $ 250 $ 250 Concerts 211 107 224 113 237 Other Events 211 311 327 328 239 Concessions 1,508 1,604 1,737 1,679 1,646 Novelties 19 11 20 12 21 Facility Use Fee(Canµ.is Events Only) 151 152 152 153 153 Total Event-Related Revenues $ 2,350 $ 2,434 $ 2,710 $ 2,534 $ 2,547 Contractually ObligatedInc ome Luxury Suites $ 1,565 $ 1,565 $ 1,565 $ 1,565 $ 1,565 ArenaB ui IderSeats ( 3 yr. payment) ArenaBui lderSeats (10 yr. payment) 40 40 40 40 40 Personal Seat Licenses NarringRi ghts 1,385 1,385 1,385 1,385 1,385 Private Fundrai si ng;Corporate Sponsorships 1,340 1,175 1,175 855 820 Advertising & Signage 1,650 1,700 1,750 1,803 1,857 GroundLease 750 750 750 750 750 BulldogFounda tion 1,375 1,375 1,375 1,375 1,375 StudentUn i onSu rplus Revenues 300 300 300 300 300 Total Contractually Obligated Income $ 8,405 $ 8, 290 $ 8, 341 $ 8,073 $ 8,093 Total Revenue $ 10,755 $ 10,724 $ 11,051 $ 10,607 $ 10,639 EXPENSES Salaries&Wa ges $ 1,215 $ 1,251 $ 1,289 $ 1,327 $ 1,367 Utilities 639 658 678 698 71 9 Non-Recoverable Event-RelatedExpenses 100 103 106 109 113 M anagernentFees 400 412 424 437 450 Adrrini strative 244 251 258 266 274 Building 588 605 623 642 661 Insurance 107 110 113 116 120 ProfessionalFees 63 65 67 69 71 Total Expenses $ 3,355 $ 3,455 $ 3,559 $ 3,665 $ 3,775 NET OPERATING INCOME $ 7,401 $ 7, 269 $ 7,492 $ 6,942 $ 6,864 Senior BondsDSRF Earnings 163 326 326 326 326 Subordinate Bonds DS RF Eami ngs 11 22 22 22 22 REVENUES AVAi LAB LE FOR SENIOR BONDS DEBT SERVICE 7, 563 7, 594 7, 818 7, 268 7, 190 REVENUES AVAILABLE FOR TOTAL DEBT SERVICE 7, 574 7,616 7, 840 7, 289 7, 21 1 Senior BondsDe bt Service(1l 5,856 5,028 5,157 4,776 4,709 Capital izedInterest (2,486) Net Senior Bonds Debt Service $ 3,370 $ 5,028 $ 5, 157 $ 4,776 $ 4,709 Capital ReplacementAccount 430 443 456 470 484 Subordinate BondsDe bt Service(1l 409 410 410 410 410 Capital izedInterest (214) Net Subordinate Bonds Debt Service $ 195 $ 410 $ 410 $ 410 $ 410 Return of BulldogFoundation Subsidy $ 1,375 $ 1,375 $ 1,375 $ 1,375 $ 1,375 NET ANNUAL SURPLUS $ 2,205 $ 360 $ 442 $ 258 $ 234 CUMULATIVE SURPLUS $ 6,91 9 $ 7, 280 $ 7, 721 $ 7, 979 $ 8,213 DEBT SERVICE COVERAGE Debt Service CoverageRati o (SeniorB ondsl 2l 2. 24 1.51 1.52 1.52 1.53 Total Debt Service CCNerageRa tid3l 2. 12 1.40 1.41 1.41 1.41 Contractual ly Obligated IncomeCoverage Rati d4l 2.49 1.65 1.62 1.69 1.72 Source: The Feasi bi lity Consultant. (ll Reflectsactual debt service figures providedby the Corporation. (2l Calculated bydividing RevenuesAvailable for SeniorBonds Deb t Service byNe t Senior BondsDeb t Service. (3l Calculated bydividing Revenues Available for Total Debt Service by thesum of Net SeniorBonds Deb t Serviceand Net Subordinate BondsDe bt Service. (4l Calculated bydividing Total Contractual ly Obligated Incomeby Net SeniorBonds Deb t Service.

17 Market Area Analysis

The market analysis presented in the Feasibility Report and summarized belCMt was intended by the FeasibilityConsultant to provide a basis for estimating the regional demands for activities at Save Mart Center, and to provide a foundation for assumptions used in preparing cash flCMt projections.

• The Campus has experienced significant grONthin student enrollment since its inception. D uri ng the Iast two decades from 1 980 to 2CXX), total enrol Iment grew at annual compoundedrate of approximately1.0 4 percent.

• According to the Campus, student enrollment is expected to reach nearly 21,150 students by the 2005 fall semester. Currently, the Campus has an enrollment of about 16,600 undergraduate students and 460 graduate students.

• The Campus supports a solid athletics program, which has been awarded numerous titi es. Historically, both the men's basketbalI and footbalI programs of the Campus have had excel Ient attendance regard Iess of their win� oss records.

• The estimated total Fresno population was 543,664 people in the primary market (10- mile radius of proposed site of Save Mart Center), an additional 223,574 people in the secondary market (25--nile radius), and an additional 220,525 people in the tertiary market(40--ni le radius), for a total populationof 987,763 people.

• As a percentage of the total market area, the primary market accounted for 55.0 percent, follCMted by the secondary market with 22.6 percent, and the tertiary market at 22.3 percent.

• The top ranking private emploters include Zacky Farms (2,780) , the Internal Revenue Service (2,CXX)), Foster Farms (1,CXX)), Aetna U.S. Healthcare (875), Pel co (800), and Upright, Inc. (800). There are over 25 private emploters in the Fresno area with over 200 empl O{ees.

• The Fresno Metropolitan Statistical Area ("MSA") ranks 64th nationally with a population of approximately925, 900.

• Compared to similar MSAs, Fresno is currently belCMt average in terms of total arena seats with 10,220. The average of the comparable MSAs is 16,057 seats.

• When the 16,CXX)Save MartCenter seats are added to the Fresno marketplace, the Fresno MSA will rank 5th in number of seats in relation to the comparable MSA's and rank 15th in the population perseat ratio of 35:3.

• There are only two arenas with over 5,CXX) seats within 150 miles of Save Mart Center, S el Iand Arena in Fresno and Centennial Gardens Arena in B akersfiel d.

18 • Compared to other markets where newer comparable arenas have recently been built, Fresno compares above average in population, number of households and average household income in the primary market areas and slightly belCMt average in the secondary and tertiary market areas.

• Compared to other markets where newer comparable arenas have recently been built, Fresno has only 11,300 arena seats (Selland Arena maximum capacity) compared to the averageof nearly 26,600 arena seats.

Competitive and Comparable F acilities[fen ants

The FeasibilityConsultant reviewedthe existing facilities within the Fresno marketplace and analyzed those which will be the most competitive. The Feasibility Consultant also analyzed comparable facilities throughout the United States, the Western Athletic Conference ("WAC") as wel I as sports Ieagues as a possibl e tenant.

General findings are summarized belCMt:

• The extent of existing competitive facilities in the Fresno area is limited. The Feasibility Consultant assumed market rates on the leases at Save Mart Center on the "other events" so as to compete with Selland Arena. The Feasibility Consultant believes that Selland Arena will not pose much of a competitive threat to the proposedSave Mart Center due to its age, size, and lack of amenities.

• The Feasibility Consultant reviewed the physical and operational characteristics of the follCMting 21 comparable arenas which have been built in approximately the past 10 years.

19 Com parable Arenas

Luxury Events Year Seating Club

Arena L cx:ation --Built Capacity Suites $000's Seats Anchor --Total Alltel Arena(U niversityof Arkansas-little Rock) Little Rock,Arkansas 2000 16,500 28 $22-$50 36 119 Cintas Center(X avierUn iversity) Cincinnati, Ohio 2000 10,250 22 $40 1,000 De Soto Civic Center Southaven, M i ssi ssi ppi 2000 10,000 12 $35-$45 NewOrleans Arena (Tulane University) NewOrleans, Louisi ana 1999 ,500 18 44 $26-$33 1,400 33 91 UnitedSpir it Center (Texas TechUn iversity) Lubbcx:k, Texas 1999 15,000 24 $20 Farri ly Arena St. Charles, Missouri 1999 11,200 44 $25-$75 300 35 97 Fi rst UnionArena Wi lkes--Barre, Pennsylvania 1999 10,500 32 $35-$38 624 34 101 Sovereign Bank Arena Trenton, NewJe rsey 1999 10,000 34 $40-$60 1,150 37 121 Schottenstein Center(Ohio State University) Colurrbus, Ohio 1998 19,500 52 $45-$65 0 Mitchell Arena (University ofAlabama) Mobile, Alabama 1998 12,800 16 $10 1,000 Centennial Garden (CSUB 1) Bakersfield,Calif ornia 1998 10,400 27 $25-$75 1,000 46 122 Bi-loCenter Greenville, South Carolina 1997 16,000 30 $45-$55 840 45 140 CrCM'nCol iseum Fayetterille, North Carol ina 1997 13,500 10 $35 36 89 The "E" Center West ValleyCi ty, Utah 1997 13,000 40 $35-$50 540 45 140 Cox Arena (San Diego State University) San Diego, California 1997 12,400 0 0 Van Andel Arena Grand Rapids, Michigan 1996 ,500 12 44 $25 1,800 36 173 SpokaneArena Spokane, Washington 1995 12,000 16 $25-$35 47 137 WorldArena Colorado Springs, Colorado 1995 9, 700 400 32 114 Mark of the Quad Cities Moline, Il linois 1993 12,200 15 $22-$29 40 146 The Pyrarrid (Universityof Memphi s) Memphi s, Tennessee 1991 20,000 26 $35-$65 Pepsi Arena(Sie nnaCol lege) Albany, NewYork 1989 17,500 25 $44 75 35 179

Source: Feasi bi lity Consultant (ll CalifomiaState University, Bakersfield.

• The Feasibility Consultant reviewed the follONing minor leagues as possible second tenants at Save Mart Center: West Coast Hockey League

Continental BasketballAssociation

National BasketballDeveloprrEnt League

Arena Footbal I 2

National I ndoor F ootbalI League

Major IndoorSoccer League • Although no contracts have been signed with any additional tenants as of the writing of the Feasibility Report, the Feasibility Consultant assumed that Save Mart Center has the abiIi ty to, and wi11 host at a mini mum, one additional sports tenant (professional, minor Ieague) , in addition to Fresno State athletics.

• Based on conversations with the Corporation, the Feasibility Consultant assurrEd an additional anchor tenant in their analysis. If the additional anchor tenant doesnot play its horrEgarrEs at Save MartCenter, the results of the analysis wi11 change.

20 • Based upon the market analysis, the compet1t1ve and comparable facilities;tenants analysis, SaveMart Center has the abiI ity to host, at a minimum, 119 to 126 events in the first five years of operation.

Financial Analysis

The Feasibility Consultant prepared a base case cash flCMt (the "Base Case") detailed in Appendix A of this Official Statement. The Base Case utilizes assumptions developed based on the Feasibility Consultant's market analysis, actual pre-sales of Contractually Obligated Income ("COi"), discussions with the Corporation, Fresno business leaders, City officials, discussions with potential sports eagues, I promoters, and suiveys of comparable col Iegi ate and professional arenas throughout the United States.

According to the Feasibility Consultant, the terrorism attacks of September11, 2001 in New York City and Washington, DC have significantly altered the state of the United States' travel and tourism i ndustry, and as of the date of the F easi bi Iity Report, al I sectors of the industry, rangi ng from airlines to hotels and ancillary seivices, were undergoing a severe contraction. The Feasibility Consultant reported that it is unclear whether this is a short-term phenomena that is likely to last for the next 12 to 18 months, or if it represents a new equi Iibri um or baseline from which the industry wi11 need to recoverover the Ianger term.

In formulating assumptions, the Feasi bi Ii ty Consultant Iooked to the past performance of comparable arenas throughout the United States. If the basic underlying structure of the industry has been altered by these events, the Feasibility Consultant believes it is likely that the results of any analysis basedon pastconditions wi11 be materially differentfrom the results eventually achieved.

General fi ndings for the fi nancial forecast are summarized belON:

• The Feasibility Report presents a summary of the estimated number and type of events, and estimated paid attendance per event for year 1 (2004) of the cash flON. It should be noted that certain events are not assumed to occur each year. Events fluctuate from between 119 and 126 events in the first five years of operation.

• Principal sources of operating and other revenues for Save Mart Center are summarized belCMt, reflecting the first year of operation. Total net revenue forecast to be received by Save Mart Center equals approximately $10. 92 rri11 ion.

21 Projected Save Mart Center Revenues Base Case - Year 1 - 2004

Tickets;Rent $ 6 72,000 Concessions and Novelties 1,527,000 Facility Use Fee 151,000 LuxurySuite Premiums 1,565,000 Arena B ui Ider Seats and Personal Seat Licenses 40,000 Naming Rights 1,385,000 Private Fundraisingf(:orporate Sponsorships 1,340,000 Advertising 1,650,000 Ground Lease 750,000 Student U nion S urpl us Revenues 300,000 B ul Idog Foundation Subsidy 1,375,000 Sr. Lien - Debt ServiceReserve Fund Earnings 1 55,000 Jr. Lien - Debt ServiceReserve Fund Earnings 10,000 Total Revenue $10, 920, 000

Source: F easi bi Ii ty Consultant

The Feasibility Consultant developed assumptions regarding operating expenses for Save Mart Center based on surveys of comparable arenas and the Feasibility Consultant's internal database. Based on the current market conditions in Fresno, and the comparable data, the Feasibility Consultant forecasted principal operating expenseitems as follONs:

• The Corporation wi11 engage a professional manager to operate Save MartCenter.

• Total operating expenses are estimated at $3.36 million in the first year of operation based on the event mix and level of utilizationprojected above.

• Based on a full-time staff equivalent of 24 persons, total staffing costs of the manager including benefits are estimated at $1.215 million in the first year. Event-day staffing costs that would be passed through to tenants are in addition to this amount.

• Utilities are projected at $639,000in year 1.

• Non-recoverable event-related expenses are projected at $100, 000 in year 1 .

• Management fee is estimated at $400,000 in year 1.

• Other expenses for administrative, insurance, professional fees, etc. are estimated at approximately $1.0 million in year 1.

Conclusion

Based on the Feasibility Consultant's knONledge of the arena/stadium industry, discussions with the Corporation, conversations with others throughout the sports i ndustry, the grONing Campus and residential population, the number of pre� eased prenium products at Save Mart Center, arrong

22 others, the Feasibility Consultant reported that it believes the Corporation's financial forecast to be reasonable and achievable. See APPENDIX A- FEASIBILITY REPORT. THE SE RI ES 2002 BONDS Description of the Series 2002 Bonds An ini ti al series of Senior B onds is created under the I ndenture and such Senior B onds are designated as the "California State University, Fresno Association, Inc. Auxiliary OrganizationEvent Center Revenue Bonds, Senior Series 2002." Senior Series 2002 Bonds will be issued under the Indenture in the aggregate principalarrount of $69,475,000. An initial series of Subordinate Bonds is created under the Indenture and such Subordinate Bonds are designated as the "California State University, Fresno Association, Inc. Auxiliary Organization Event Center Subordinate Revenue Bonds, Subordinate Seri es 2002." Subordinate Seri es 2002 B onds wi 11 be issued under the Indenture in the aggregate pri ncipal arrount of $5, 000,000. Interest on the Series 2002 Bonds wi 11 be payable serriannually on J anuary 1 and J uly 1 in each year, commencingJuly 1, 2002. The Series 2002Bonds will mature onJuly 1 of the years, in the arrounts, and bearinterest at the rates (computed on the basisof a 360-day year of twelve 30-day months), set forth on the inside front coverpage. The Senior Series 2002Bonds wi11 beissued as fully registeredBonds in the denorrination of five thousand dollars ($5,000) or any integral multiple thereof, so long as no Bond will have principal maturingin morethan one year. The SubordinateSeri es 2002 Bonds wi 11 be issued as fully registered Bonds in the denomination of one hundred thousand dollars ($100,000) and integral multiples of $5,000in excess thereof, so long as no Bond will have principal maturing in morethan one year. Interest on the Series 2002 Bonds is payable in Iawful money of the U nited Statesof America by check maiIed by fi rst class maiI on each i nterest payment date to the registered CMtner as of the close of business on the fifteenth (15th) day of the calendar month immediately preceding such interest payment date (whether or not the fifteenth ( 15th) day is a Business Day) (the "Record Date''); provided, hCMtever, thatany registered CMtner of $1,000,000or more of the principalamount of the Series 2002 Bonds may, at any time prior to a Record Date, give to the Trustee written instructions for payment of such interest on each succeeding interestpayment date by wire transfer. The principal on the Series 2002 Bonds and premium, if any, thereon are payable when due upon presentation thereof at the corporate trust office of the Trustee in lawful money of the United States of America. The Series 2002 Bonds wi11 be dated as of J anuary 15, 2002, and wi11 bear interest from the interest payment date next preceding the date of authentication thereof uni ess such date of authentication is an interest payment date, in which event they wi 11 bear interest from such date of authentication, or unless this Bond is authenticated during the period after a Record Date but before the next interest payment date, in which event this B ond wi 11 bear interest from that next interest payment date, or uni ess such date of authentication is on or beforeJune 15, 2002, in which event they will bear interest fromJanuary 15, 2002; provided, hCMtever, that if, at the time of authentication of any fully registered Bond, interest is in default on outstanding Bonds, such fully registered Bond wi 11

23 bear interest from the interest payment date to which interest has previously been paid or made available for paymenton the Outstanding Bonds. Redemption of the Series 2002 Bonds The Series 2002 B onds are subject to mandatory, optional and special redemption as described belCMt. MandatoryRedemption. The Senior Series 2002Bonds maturingon J uly 1, 2022 are subject to mandatory sinking fund redemption in part by ot,I on J uly 1 , 2014, and on each J uly 1 thereafter until and including July 1, 2022, from Mandatory Sinking Account Payments deposited in the respective S inking Accounts at the princi pal amounts and interest accrued with respect thereto to the dates fixedfor redemption without premium, as folI ONs: Mandatory Sinking Account PaymentDate Mandatory S inki ng U uly 1) Account Payment 2014 $4,005,000 2015 1,260,000 2016 1,510,000 2017 1,400,000 2018 1,440,000 2019 1,555,000 2020 1,600,000 2021 1,965,000 2022* 4,710,000 * Final Maturity The Senior Series 2002 Bonds maturing on July 1, 2026 are subject to mandatory sinking fund redemption in part by ot,I on J uly 1 , 2023, and on each J uly 1 thereafter untiI and including July 1, 2026, from Mandatory Sinking Account Payments deposited in the respective Sinking Accounts at the principal amounts and interest accrued with respect thereto to the dates fixed for redemption without premium, as folI ONs: Mandatory Sinking Account PaymentDate Mandatory S i nki ng U uly 1) Account Payment 2023 $5,060,000 2024 5,310,000 2025 2,755,000 2026* 3,150,000 * Final Maturity

24 The Senior Series 2002 Bonds maturing on July 1, 203 1 are subject to mandatory sinking fund redemption in part bytot, I on J uly 1 , 2027, and on each J uly 1 thereafter untiI and including July 1, 2031, from Mandatory Sinking Account Payments deposited in the respective Sinking Accounts at the principal amounts and interest accrued with respect thereto to the dates fixed for redemption without premium, as folI ONs: Mandatory Sinking Account PaymentDate Mandatory S inki ng U uly 1) Account Payment 2027 $2,230,000 2028 2,315,000 2029 2,480,000 2030 2,575,000 203 1* 6,845,000 * Final Maturity The S ubordinate Seri es 2002 B onds maturing on J uly 1 , 2022 are subject to mandatory sinking fund redemption in part byt lot, on July 1, 2004, and on each July 1 thereafter untiI and including July 1, 2022, from Mandatory Sinking Account Payments deposited in the respective Si nki ng Accounts at the pri nci palamounts and interest accrued with respectthereto to the dates fixed for redemption without premium, as follONs: Mandatory Sinking Account PaymentDate Mandatory S inki ng U uly 1) Account Payment 2004 $ 65,000 2005 70,000 2006 75,000 2007 80,000 2008 85,000 2009 90,000 2010 95,000 2011 100,000 2012 110,000 2013 115,000 2014 125,000 2015 130,000 2016 140,000 2017 150,000 2018 160,000 2019 170,000 2020 180,000 2021 195,000 2022* 210,000 * Final Maturity The S ubordinate Seri es 2002 B onds maturing on J uly 1 , 2031 are subject to mandatory sinking fund redemption in part bytot, I on J uly 1 , 2023, and on each J uly 1 thereafter untiI and including July 1, 203 1, from Mandatory Sinking Account Payments deposited in the respective

25 Si nki ng Accounts at the pri nci palarrounts and interest accrued with respectthereto to the dates fixed for redemption without premium, as follONs: Mandatory Sinking Account PaymentDate Mandatory S inki ng U uly 1) Account Payment 2023 $220,000 2024 240,000 2025 255,000 2026 270,000 2027 290,000 2028 310,000 2029 335,000 2030 355,000 203 1* 380,000 * Final Maturity Optional Redemption. The Senior Series 2002 Bonds maturing on or after July 1, 2013, are subject to redemption prior to maturityon and after July 1, 2012, as a whole or in part on anydate, at the option of the Corporation, from any source of available funds, at the follONing redemption prices ( expressed as a percentage of the principal arrount of Senior Seri es 2002 B onds calI ed for redemption), plus accrued interest with respectthereto to the date fixedfor redemption: Redemption Period Redemption (Dates Incl usive) Price

July 1, 2012 toJune 30, 2013 101% July 1, 2013 toJune 30, 2014 100.5% J uly 1 , 2014 and thereafter 1 OCJ>/o

The S ubordinate Seri es 2002 B onds maturing on or after J uly 1, 2022, are subject to redemption prior to maturityon and afterJ uly 1, 2012, as a whole or in parton anydate, at the option of the Corporation,from anysource of available funds, at the follONingredemption prices (expressed as a percentage of the principal arrount of S ubordinate Seri es 2002 B onds calI ed for redemption), pl us accrued interest with respectthereto to the date fixedfor redemption: Redemption Period Redemption (Dates Incl usive) Price

July 1, 2012 toJune 30, 2013 101% July 1, 2013 toJune 30, 2014 100.5% J uly 1 , 2014 and thereafter 1 OCJ>/o

Special Mandatory Redemption. The Corporation will have the right to redeem the Series 2002 Bonds as a whole or in part on any date from proceeds of insurance or proceeds of eminent domain proceedings, upon the terms and conditions of, and as provided for in the Indenture at the principal arrount thereof and accrued interest thereon to the date fixed for redemption, without premium.

26 Selection of Bonds for Redemption. Whenever less than all of the Series 2002 Bonds are called for redemption, the Corporation will notify the Trusteein writing of the series and maturities to be so redeemed (and, if not so notified, the Trustee will redeem such Bonds in inverse order of maturity); provided, hONever, that if Bonds are called for redemption from insurance or eminent domainproceeds, such Bonds wi 11 beselected for redemptionso that first the amountof Annual Debt Servicefor the Senior Bonds remainingOutstanding follONingsuch redemption is as nearly equal as practicable and second the amount of Annual Debt Service for the Subordinate Bonds remaining Outstanding folI ONi ng such redemption is as nearly equal as practicable. Whenever Iess than alI of the Series 2002 Bonds of any one maturity of any series are called for redemption and such Bonds are redeemable by ot,I the Trusteewi 11 selectthe Seri es 2002B onds of such maturityto beredeemed, from the outstanding Bonds of such maturity, by lot in anymanner which the Trustee deems fair. SECURITY FOR THE SERI ES 2002 BONDS Pledge of Event Center Project Revenues Under the Indenture, the Corporation pledges to secure the payment of the Bonds, all of the Event Center Project Revenues and any other amounts (including proceeds of the sale of Bonds) held in anyfund or account established pursuant to the Indenture other than the Rebate Fund. Said pledge will constitute a lien on and security interest in such assets for the payment of the Bonds in accordance with their terms; provided, hONever, that said pledge is created and established in the follONing order of priority: first, to secure the payment of the Senior Bonds, and second, to secure the payment of the Subordinate Bonds. The Indenture also provides that the amounts on deposit in the Subordinate ReserveAccount will be pledged exclusively to and provide security solely for the Subordinate B onds so that the Senior B onds wi 11 have no security or other interest therein. Pursuant to the Indenture, the Corporation agrees that, so long as any of the Bonds remain Outstanding, all of the Event Center Project Revenues of the Corporation not needed to pay Operating Expenseswill be deposited as soon as practicable (and in any event within five Business Days) upon receipt in the Event Center ProjectRevenue Fund which the Corporation will establish and maintai n under the Indenture in an account or accounts with the Trustee. S ubject to the fl ONof funds described belON, follONingsuch deposit with the Trusteeand so long as no Event of Default has occurred and is continuing, the Corporation may, upon the filing of a Statement of the Corporation with the Trustee, withdraw all or any part of such amounts on deposit with the Trustee anticipated to be needed for the payment of Operating Expenses and deposit such amounts at such other banking or financial institution or institutions as the Corporation will from time to time designate in writing to the Trustee for such purpose which Depository Bank will have its long-term unsecured debt rated "A" or better by a Rating Agency. Subject only to the provisions of the Indenture, the Corporation pledges and, to the extent permitted by law, grants a security interest to the Trustee in the Event Center Project Revenue Fund to secure the payment of the Bonds. Event Center Project Revenues Pursuant to the Indenture, Event Center Project Revenues include all existing fund balances, proceeds, charges, income, rents, receipts, profits and benefits of the Corporation, in each case related to or derived from (i) the ONnership and/or operation bythe Corporation of the Event Center Project, including without limitation all gate receipts, revenues of the Corporation derived from concessions, sales of novelties, Arena Builder Seat sales, private fundraising, corporate sponsorships, luxury seat sales, personal seat licenses, signage contracts and naming rights, (ii) the Ground Lease,

27 (iii) the B ulI dog Foundation MOU , and ( iv) the Student Seating Purchase A greerrEnt, but in alI cases exclusive of: (a) any gifts, grants, bequests, donations and contributions to the extent specifically restricted bytthe donor to a particularpurpose inconsistent with thei r use for payrrEnts with respectto Indebtedness; and ( b) assets of the Corporation unrelated to, or not derived from, the CMtnership and/or operationbyt the Corporationof the Event Center Project. Sponsorship and Naming Rights. Pursuant to the Indenture, Event Center Project Revenues will include proceeds received byt the Corporation with respect to the various sponsorship and naming rights agreerrEnts relating to the Events Center. See the caption "SAVE MART CENTER - Event Center Project Revenues." Seat Licenses. I ncorrE derived byt the Corporation from Arena Builders Licenses, Luxury Suite Licenses, and Personal Seat Licenses are included in the definition of Event Center Project Revenues under the Indenture. See the caption "SAVE MART CENTER - Event Center Project Revenues." PayrrEnts from Bulldog Foundation. Pursuant to the Indenture, Event Center Project Revenues will include payrrEnts received byt the Corporation from the Bulldog Foundation, a Campus alumni organization ( the "B ul Idog Foundation") pursuant to the Bul I dog Foundation MOU , dated as of January 1, 2002, byt and between the Corporation and the Bulldog Foundation. See the caption "SAVE MART CENTER - Event Center ProjectRevenues." Student Seating Purchase AgreerrEnt. Pursuant to the Indenture, Event Center Project Revenues wi 11 incl ude payrrEnts received bytthe Corporationfrom the CSU Trustees, pursuant to the Student Seating Purchase AgreerrEnt. See the caption "SAVE MART CENTER - Event Center Project Revenues." Rate C011enant Pursuant to the Indenture, the Corporation agrees to fix, charge and collect, or cause to be fixed, charged and collected, subjectto applicable requirerrEnts or restrictions imposedbyt law, such rates, fees, charges and prices for use, occupancy and operations of the Event Center Project and other goodsand services and charges which, together with alI Event Center Project Revenues of the Corporation, will be budgeted for the next Fiscal Year to be sufficient to produceNet Event Center Project Revenues Available for Debt Service equal to at least (i) one and forty-hundredths (1.40) tirrEs Aggregate Annual Debt Service for the Senior Bonds and all Parity Senior Debt then Outstanding for the next Fiscal Year; and (ii) one (1.00) tirrEsAggregate Annual Debt Service on all Parity Senior Debt and ParitySubordinate Debt then outstanding for the next Fiscal Year. On or beforeJ une 1 in each year, comrrEncingJ une 1, 2004, the Corporation will file with the Trustee a StaterrEnt of the Corporation calculating the ratio of Net Event Center Project Revenues A vaiI able for Debt Serviceto Aggregate Annual Debt Servicefor the Senior Bonds and alI Parity Senior Debt then Outstanding for the imrrEdiatelysucceeding Fiscal Year. If the Corporation files a StaterrEnt of the Corporation that sets forth a ratio of less than 1.40, the Corporation will promptly retain the services of a Event Center Consultant. Such Event Center Consultant will examine the rents, fees and prices as wel I as the Operating Expensesfor the Event Center Project and will file a report with the Trustee and the Corporation containing recomrrEndations of actions that mayincrease the amountof Net Event Center ProjectRevenues Available for Debt Service.

28 The Corporation will fix, charge and collect, or cause to be fixed, charged and collected, subject to applicable requirell"Ents or restrictions imposed byt law, such rates, fees, charges and prices for the use, occupancy and operations of the Event Center Project and other goods and services and charges which, together with all Event Center Project Revenues of the Corporation, will be budgeted for the next Fiscal Year to be sufficient to produce Net Event Center Project Revenues Available for Debt Service equal to at Ieast one (1 . 00)ti ll"ES Aggregate Annual Debt Service for the Senior B onds, the Subordinate Bonds, all Parity Senior Debt and all Parity Subordinate Debt then Outstanding for the next Fiseal Y ear.

Reser ve Accounts

The Senior Reserve Account is established under the Indenture and will be funded in the amount of $6,206,417.00 from Senior Series 2002 Bond proceeds at the closing of the Series 2002 Bonds. All amounts in the Senior Reserve Account (including amounts obtained from letters of credit or insurance policies on deposit in the Senior Reserve Account) shall be used and withdrawn byt the Trustee solely for the purpose of rnaking up any deficiency in the Senior Interest Account or Senior Principal Account or (together with any other moneys available therefor) for the payll"Ent or redemption of all Senior Bonds then Outstanding. Amounts on deposit in the Senior Reserve Account are not avai Iable to make up deficiencies with respect to the Subordi nate Bonds.

The S ubordinate Reserve Account is established under the Indenture and wi11 be funded i n the amount of $410,450.00 from Subordinate Series 2002 Bond proceeds at the closing of the Series 2002 Bonds. A11 amounts in the Subordinate Reserve Account (including amounts obtained from letters of credit or insurance policies on deposit in the Subordinate Reserve Account) shall be used and withdrawn byt the Trustee solely for the purpose of making up any deficiency in the Subordinate Interest Account or S ubordinate P ri nci pal Account or ( together with any other moneys avai Iable therefor) for the payll"Ent or redemption of al I Subordinate Bonds then Outstanding. A mounts on deposit in the SubordinateReserve Account are not available to make up deficiencies with respect to the Senior B onds.

Capitalized Inter est Accounts

U nder the I ndenture, capitalized interest accounts i n the Revenue Fund for each of the Senior Seri es 2002 B onds and the S ubordinate Seri es 2002 B onds( colI ectively, the "Capitalized nterestI Accounts") are established. On the date Series 2002 Bonds are issued, the Trustee will deposit $7, 209,1 58. 70 of the proceeds from the sale of the Senior Series 2002 B onds (plus accrued i nterest) into the Senior Seri es 2002 Capitalized Interest Account and $632, 831 . 04of the proceeds of the sale of the S ubordinate Series 2002 B onds (plus accrued i nterest) into the S ubordinate Seri es 2002 Capitalized Interest Account. The amounts so deposited, together with the projected earnings from the investll"Ent thereof, are estimated to be sufficient to enable the Trustee to pay interest on the Senior Series 2002 Bonds and the Subordinate Series 2002 Bonds from the respective Capitalized Interest Account to February 15, 2004.

The Ground Lease

The Corporation has also pledged as security for the Series 2002 Bonds its interest in the Ground Lease. Pursuant to the Ground Lease, the CSU Trustees lease to the Corporation a certain parcel of land on the Campus, as more particularly described in the Ground Lease. The term of the Ground Lease will end on December13, 2033, unless it is extended or sooner terminated as provided

29 therein, except that the term shalI in no event extend beyond December 13,204 3. Under its terms, except as provided belON, the Ground Lease termi nates upon the occurrence of certain events, including failure by the Corporation to perform any substantial provision of the Ground Lease, cessation of operations of the Corporation or exercise by the CSU Trustees of their option to purchase the Event Center Project anddefease the Bonds. The Ground Lease also provides thatthe CSU Trustees shalI take alI reasonable action to approve a successor corporation and transfer the Ground Lease and distribute the Corporation's net assets to the successor upon (i) cessation of operations of the Corporation, (ii) failure bythe Corporation to performany substantial provision of the Ground Lease, or (iii) the assignment or subleasing by the Corporation of any part of the premises Ieased without permission of the CSU Trustees. For a further descri pti on of the Ground Lease, see "APPENDIX B -SUMMARIES OF CERTAIN PROVISIONS OF THE INDENTURE AND GROUND LEASE -THE GROUND LEASE." Deposit of Event Center Project Revenues Amounts in the Event Center Project Revenue Fund may be used and withdrawn by the Corporation at any time for the payment of Operating Expenses or to make the deposits in the manner required bythe Indenture. In the event that on the twenty-fifth (25th) day of each month, the Trusteedoes not have amountssu fficientto makethe transfers and deposits requi red bythe I ndenture on the first day of the next succeeding month, the Trustee wi 11 notify the Corporation and the Depository Bank(s), to the extent practicable, by telephone or telecopy, of such delinquency, and unless such payment is madeon the same day the Corporation receives such notice, the Corporation will cause the Depository Bank(s) to, and the Depository Bank(s) will, transfer all Event Center Project Revenues held by such Depository B ank(s) to the Trustee to hold in trust for the benefit of the Holders of the Bonds and the holders of ParitySenior Debt. During any period that the Trustee does not have amounts sufficient to make the transfers and deposits required by the Indenture, the Corporation will not be entitled to use or withdraw any of the Event Center ProjectRevenues unless used and withdrawn for the payment of current or past due Operating Expenses of the Corporation. Otherwise, the Trustee will use and withdraw from timeto time amounts in said fund to make the transfers and deposits required by the Indenture and any Parity Senior Debt as such payments become due, and if such amounts will not be sufficient to pay in full all such payments due on any date, then to the payment of the transfers and deposits required by the Indenture and debt service with respect to Parity Senior Debt ratably according to the amounts due respectively for such transfers and deposits required bythe Indenture and such debt service on Parity Senior Debt, without any discrimination or preference. The Corporation agrees to execute and deliver all instruments as may be required to implement this paragraph. The Corporation further agrees that a faiI ure to comply with the termsof this paragraph wi 11 cause irreparableharm to the Holders from ti meto ti me of the Bonds and the holders of Parity Senior Debt and will entitle the Trustee, with or without notice, to take immediate action to compel the specific performance of the obligations of the Corporationas providedin this paragraph. On or beforethe fifteenth (15th) dayof each monthand so long as anyof the Bonds remain Outstanding, the Corporation wi11 pay to the Trustee such amount as is required by the Trustee to make the transfers and deposits required on the fi rst day of the next succeeding month by the I ndenture. Each transfer by the Corporation to the Trustee under the I ndenture wi 11 be in Iawful money of the U ni tedStates of America and paid to the Trusteeat the Pri nci palOffice of the Trustee. All such moneys will be promptly deposited by the Trustee upon receipt thereof in a special fund designated as the " Revenue Fund" which the Trustee wi11 establish, maintain and hold in trust. A11

30 rroneysdeposited with the Trusteewi 11 be held, disbursed, alI oc:ated and appl ied bythe Trusteeonly as provided in the Indenture. If bythe sixteenth ( 16th) day of each rronththe Trustee has not received rroneyssu fficientto make the transfers and deposits required on the fi rst day of the next succeeding rronth by the I ndenture, the Trustee wi 11 immediately notify the Corporation of such insufficiency by telegram, telecopy or telephone (confirmedin writing). If on the twentieth (20th) day of such rronth the Trustee has not received rroneys sufficient to make the transfers and deposits required on the first day of the nextsucceedi ng rronth by the Indenture, the Trusteewi 11 immediately notify the Corporation by telegram, telecopy or telephone (confirmed in writing). Said notice will demand the Corporation to immediately deposit an arrount equalto the arrountnecessary to makethe transfers and deposits requiredon the first day of the next succeeding rronth bythe Indenture. If the Trustee does not receive such arrount by the twenty-fifth (25th) day of such rronth, the Trustee will take the actions described in the first paragraph of this subsection. FICMtof Funds On or beforethe dates set forth belON, the Corporationwi 11 transfer or wi11 cause the Trustee to transfer from the Event Center Project Revenue Fund and deposit into the follONing respective accounts, the follONing arrounts, in the follONing order of priority, the requirements of each such account (including the making up of any deficiencies in any such account resulting from lack of rroneys sufficient to make any earlier required deposit) at the timeof deposit to be satisfied before anytransfer is madeto any accountsubsequent in priority: (i) On or before the first day of each rronth, to the Senior Interest Account (which the Trustee will establish and maintain in the Revenue Fund), one-sixth of the aggregate arrount of interest beconing due and payable during the next ensuing six rronths on all Senior Bonds then Outstanding less any arrounts to be transferred to the Senior Interest Account from the Senior Capitalized Interest Account as capitalized interest for the paymentof such interest, untiI the balance in the Senior Interest Account is equal to said aggregate arrount of interest (taking into account said transfers from the Senior CapitalizedInterest Account); providedthat during the periodfrom the date of delivery of a series of Senior Bonds until the first interest payment date for such series, such transfers wi 11 be sufficient on a rronthly pro rata basis to pay the aggregate arrount of interest becomingdue and payable on the fi rst interest paymentdate for such series. (ii) On or beforethe first day of each rronth, to the Senior Principal Account (which the Trustee will establish and maintain in the Revenue Fund), one-twelfth of the aggregate arrount of principal becoming due and payable on the Outstanding Senior Serial Bonds plus the aggregate arrount of Mandatory Sinking Account Payments required to be paid into the respective Sinking Accounts for Outstanding Senior Term Bonds, in each case during the next ensuing twelve rronths, untiI the balance in said account is equal to said aggregate arrount of such pri nci pal and Mandatory Sinking Account Payments; provided that during the period from the date of delivery of a series of Senior Bonds until the first principal payment date for such series (if less than twelve rronths), such transfers will be sufficient on a rronthly pro rata basis to pay the aggregate arrount of principal becomingdue and payable on the fi rst pri nci palpayment date for such series.

31 (iii) On or before the first day of each rronth, to the Senior ReserveAccount (which the Trustee wi11 establ i sh and rraintai n in the Revenue Fund), an arrount equal to either: (a) an arrount equal to the arrount, if any, necessaryto restore the arrounton depositin such account to the Senior ReserveAccount Requirell"Ent, or (b) the arrountnecessary to repay any and all obligations due and payable under the terms and conditions of any Ietter of credit provided for i n the Indenture or any insurance policy provided for in the Indenture. No deposit need be rm.de into the Senior Reserve Account so Iong as the balancein said account wi 11 beat Ieast equal to the arrount required byin the Indenture to beon deposit therein. (iv) On or beforethe first day of each rronth, to the Capital Replace!l"Ent Account (which the Corporation will establish and rraintain), an arrount equal to one-twelfth of the Capital R epl ace!l"EntAccount Requi rell"Entfor the nextensuing twelverronths. (v) On or beforethe first day of each rronth, to the Subordinate Interest Account (which the Trustee will establish and rraintain in the Revenue Fund), one-sixth of the aggregate arrount of interest becomingdue and payable during the next ensui ng six rronths on alI S ubordinate B onds then Outstanding less any arrounts to be transferred to the Subordinate Interest Account from the SubordinateCapitalized I nterest Account as capitalized interest for the payll"Entof such interest, untiI the balance in the S ubordinate Interest Account is equal to said aggregate arrountof interest ( taki ng into account said transfers from the S ubordinate Capitalized nterestI Account); provided that duri ng the period from the date of delivery of a series of S ubordinate B onds untiI the fi rst interest payll"Ent date for such series, such transfers will be sufficienton a rronthlypro rata basis to pay the aggregate arrount of interest becomingdue and payable on the first interest payll"Entdate for such series. (vi) On or before the first day of each rronth, to the Subordinate Principal Account (which the Trustee will establish and rraintain in the Revenue Fund), one-twelfth of the aggregate arrount of principal becomingdue and payable on the Outstanding SubordinateSeri al Bonds plus the aggregate arrount of Mandatory Sinking Account Payll"Ents required to be paid into the respective Sinking Accounts for Outstanding Subordinate Term Bonds, in each case during the next ensuing twelve rronths, untiI the balance in said account is equal to said aggregate arrount of such principal and MandatorySinking Account Pay!l"Ents; provided that during the periodfrom the date of delivery of a series of S ubordinate B onds untiI the first principal payll"Ent date for such series (if Iess than twelve rronths), such transfers will be sufficient on a rronthly pro rata basis to pay the aggregate arrount of principal becomingdue and payable on the first principal payll"Entdate for such series. (vii) On or beforethe first day of each rronth,to the SubordinateReserve Account (which the Trustee will establish and rraintain in the Revenue Fund), an arrount equal to either: (a) an arrountequal to the arrount, if any, necessaryto restore the arrounton depositin such account to the Subordinate Reserve Account Requirell"Ent, or (b) the arrount necessary to repay any and all obligations due and payable under the terms and conditions of anyletter of credit provided for in the Indenture or any insurance policy provided for in the I ndenture. No deposit need be rm.de into the Subordinate Reserve Account so Iong as the balance in said account wi 11 be at Ieast equal to the arrount required bythe Indenture to beon deposit therein. (viii) On or before J une 30 in each year, comll"Encing J une 30, 2004, to the Bul I dog Foundation Repayll"Ent Account (which the Corporation shall establish and rraintain) that arrount, if any, specified in a Written Request of the Corporation filed with the Trustee as being the arrount then due and payable to the Bul I dog Foundation pursuant to the B ulI dog Foundation A gree!l"Ent.

32 (ix) OnJ uly 2 in each year, after all of the foregoing transfers have beenmade in full, any remaining Event Center Project Revenues will be deposited into the Surplus Account (which the Trustee wi11 establish and maintain within theRevenue Fund). Surplus Account So Iong as no Event of Default ( as specified in the Indenture) has occurred or is continuing and the Senior Seri es 2002Bonds are Outstanding, the Trusteewi 11 retain within the Surplus Account all arrnunts deposited therein until the arrnunt on deposit equals $5,CXX),CXX), and, thereafter, the Trusteewill: (i) deposit So>/o of the arrnuntin excess of such $5,CXX),CXX)onJ uly 2 in each year into the Senior Optional Redemption Account and apply such arrnunt (together with such $5,CXX),CXX)) to the redemption of Senior B onds on thei r first optional redemption date in accordance with the Indenture ( or to the prior purchase of Senior B onds in accordance with the Indenture) ; and (ii) apply So>/o of the arrnunt in excess of such $5,CXX),CXX) on July 2 in each year to any of the follONing purposes, as may be specified in a Written Request of the Corporation: (a) to satisfya deficiency in certain other funds established pursuant to the Indenture, (b) to pay Operating Expenses or (c) if, as set forth in a Certificate of the Corporation filed with the Trustee, (1) the Debt Service Coverage Ratio for the preceding Fiscal Year is at least 1.40 and (2) the Contractually Obligated Income Coverage Ratio is at Ieast 1. 00 for the 2 4-rronthperiod immediately folI CMti ng such di stri buti on, for di stributi on to the Corporationfor use anyI awful purpose. Additional Senior Bonds In addition to the Senior Series 2002 Bonds, the Corporation mayissue one or rrnre other series of Bonds on a parity with the Senior Series 2002 Bonds, in such principalarrnunt as will be determined bythe Corporation, but only uponcompliance bythe Corporation with the provisionsof the I ndenture, and subject to the folI ONi ng specific conditions, which, arrnng others, are conditions precedentto the issuance of anysuch additional series of Senior B onds: (i) The Corporationwi 11 not bein default under the Indenture. (ii) The supplemental indenture authorizing the issuance of such additional series of Senior Bonds will require that the proceeds of the sale of such additional series will be applied for the acquisition and construction of any Completion Project or Subsequent Project, or for refunding anyOutstanding Bonds, including the payment of costs and expensesof and incident to the issuance and sale of such additional series of Bonds and funding of any Reserve Account deposits. Said supplemental indenture may also provide that a portion of such proceeds wi11 be applied to the payment of interest due or to become due on said Senior Bonds during the estimated period of construction of such Completion Project or Subsequent Project and for a further period of not exceedingsix (6) rrnnthsafter said periodof construction. (iii) If the proceeds of such additional series of Senior Bonds are to be used, in whole or in part, to finance construction on real property not subject to the lien of this Indenture, the supplemental indenture authorizing the issuance of such additional series of Senior B onds wi 11 subject such additional real propertyto the Ii en of the I ndenture. (iv) (a) the Debt Service Coverage Ratio for the Fiscal Year immediately preceding the date on which such additional series of Senior Bonds wi11 becomeOutstanding wi11 have beenat Ieast equalto one and one-half (1.50) times; and (b) the Debt ServiceCoverage Ratio for the Fiscal Year

33 imrrEdiately follONing completion of the Completion Project or Subsequent Project paid from the proceeds of such additional series of Senior B onds wi11 be estimated to be at Ieast equal to one and one-half (1.50) tirrEs; provided, hONever, that if such additional series of Senior Bonds refund any Outstanding Bonds, the foregoing requirerrEnt will not apply if Annual Debt Service for all the B onds is not increased in anyyear folI ONi ng issuance of such additional series of Senior B onds. (v) The balanceon depositin the Senior Reserve Accountwill beincreased to an amount equal to the Senior ReserveAccount RequirerrEnt, calculated by including the additional series of Senior B onds then proposedto beissued. Certain Financial Coven ants Completion and Operation of Events Center Project. The Corporation will diligently cause the construction, acquisition and improverrEnt of the Event Center Project to proceed to tirrEly completion. The Corporation will operate the Event Center Project as a first-class sports and entertai nrrEntfaci I i tycomparable to simi I ar venues in the U ni ted States. Change Orders. The Corporation will not approve any change orders concerning the Event Center Project unless prior to such approval the Corporation has filed with the Trustee a Certificate of the Corporationstating the cost of the change order and the source of funds from which such costs will be paid and confirming that the Corporation has sufficient funds to complete the Event Center Project, as modified bysuch change order. Change to Required Insurance Coverage During Construction. The Corporation will not modify any of the insurance required to be maintainedduring the construction of the Event Center Project, as set forth in the Project DocurrEnts or elsewhere, without the prior written approval of the Holders of a maj orityin aggregate principal amount of Bonds then outstanding; provided, hONever, that the Corporation may, without notice to or the consent of any Holders of the B onds, consent to alterations or modifications thereof which would not have a Material Adverse Effecton the i nterests of the Holders of the B onds then outstanding. THE CALIFORNIA STATE UNIVERSITY, FRESNO The follCMting inforrmtionwas obtained fromthe applicable participants and other sources believed bythe Corporation to bere liable, but is not guaranteed as to the accuracyor completeness of anyinf orrmtionprov ided byany party other than the Corporation. General Description The Campus is located in central California's San Joaquin Valley, and is the sixth oldest campus in The California State University system. Founded in 1911 as a state normal school, in 1921 it combined with California's first junior college to becorrE Fresno State Teachers College and was authorized to offer a four-year program and grant the bachelor of arts degree in teaching. In 193 5, by act of the State's General Assembly, its designation was changed to Fresno State ColI ege. By 1949, a varietyof degreeprograms were offered including a master'sdegree. Today, the Campus offersa substantial number of degreesat the undergraduate Ievel and master's degrees in 41 fields of study.

34 By errphasizing the primacyof qualityteaching and the close interaction between faculty and students, the Campus seeks to stimulate scholarly inquiry and discourse, inspire creative activity, heighten professional and technical competencies, encourage and support research and its dissemi nation, and recruit and developoutstanding teacher-scholars/artists.

The Campus fosters an environment in which students Iearn to Iive in a culturally diverse and changing society. Within that environment, it strives to develop a community founded upon mutual respect and shared efforts, in which individuals can communicate openly and work together to enrich the lives of all and to further the grCMlth and excellence of the university. The Campus seeks and encourages historically under-represented students to embark upon and complete a university education.

Student Enrollment

The 1 999-2CXX) academic year average student enrol Iment and FTE S enrol Iment at the Campus were 18, 137 and 15,296, respectively. This compares to an academic year average student enrollment of 17,913 and 15,084 FTES for the 1998-1 999 academic year. This represents an approximately 1.25% academic year average student enrollment increase and an approximately 1.41% average FTE S enrol Iment increase. The Corporation expects that student enrol Iment at the Campus will remain stable or increase in the reasonably foreseeable future.

Campus Programs and Services

The Campus is comprised of the follCMting colleges and schools: Agricultural Sciences and Technology, Arts and Humanities, Engineering and Computer Science, Health and Human Services, Science and Mathematics, Social Sciences, The Craig School of B usi ness, Kremen School of Education and Human Development and Library Services and the Division of Extended Education. The Campus is fully accredited by the California Board of Education and the Western Association of Schools and Colleges. The Campus is a member of the Western Association of Graduate Schools, the Council of Graduate Schools in the United States, and the American Association of Colleges for Teacher Education. The Kremen School of Education and Human Development offers an interdisciplinary doctoral degree (Ed.D.) in educational leadership, offered in partnership with the University of California.

To expand its mission of offering educational opportunity to qualified students at the bachelor's and master's Ievel s, as wel I as in j oi nt doctoral programs in selected professional areas, the Campus provides a General Education program and other opportunities to expand students' intellectual horizons, foster lifelong learning, prepare them for further professional study and instill within them an appreciation of cultures other than their CMtn. The Campus offers undergraduate degrees and programsin the Ii beralarts and sciences as wel I as in a varietyof professional disci pl i nes emphasizing agriculture, business, engineering and technology, health and human services, and education, preparing students for productive careers and responsible world ci tizenshi p. B ui Iding upon the strength of these undergraduate programs, graduate programs provide opportunities for personal and career enhancement through advanced study, preparing students for positions of Ieadershi p i n the arts, sciences and professions.

The Carrpus offers numerous services for its students which are provided through a variety of offices. The Office of Student Life and Development, for example, is the administrative home for a variety of student program offices in the Campus Division of Student Affairs. These programs

35 incl ude student development, Greek affairs, Student clubs and organizations, intramurals and recreation, chi Id care, student activities and Southeast Asian student services. Other Campus student services include advising services, alumni association, Associated Students Inc. of CSU Fresno, athletics, auxiliary organizations (including the Corporation), career development and employment services, computer services, the developmental learning resource center, disabled student services, educational opportunity programs, extended education, health and counseling services, instructional media services, international programs, library services, migrant services, orientation and transition services, outreach services, reentry programs, student affairs, students for community service, testi ng services and veterans affairs.

The Campus also offers compet1t1ve intercollegiate athletic programs in the National Collegiate Athletic Association (NCAA) Division I-A, participating in the Western Athletic Conference. I ts men's i ntercol Iegi ate athletic sports incl ude basebalI , basketbal I, cross county;track and field, football, golf, soccer, tennis and wrestling. The women's intercollegiate sports include basketbalI, cross country ;track and field, softbal I, swimming and diving, tennis, vol Ieybal I, soccer and equestrian. Campus athletic faciIi ties include the approxi mately ,41 ()()(}-seat B ul Idog Stadium ( footbalI), 6, 52 5-seat B eiden Field (basebal I), softbal I and track and field faci Iiti es, two gymnasiurns, an indoor/o utdoor swimming complex, twelve tennis courts, six handball fracquetbalI courts, two weight training facilities and two putting greens and driving areas.

Campus Facilities

The 327-acre main grounds of the Campus presently include rrore than forty-six traditional and modern permanent buildings housing administration and technical support functions as well as the schools described above. An additional 34 structures, including the offices of the California Agricultural Technology institute, are located on the 1,083 acre University Farm. Complementing the academic facilities of the Campus are the athletic facilities described above. Supplementing the Campus physical plant constructed and maintained by CSU are the facilities CMtned and operated by the Corporation. These facilities include a three-story bookstore which ranks arrong the top sixty collegiate bookstores in the nation, a three-story University Student Union, a Satellite Student Union faci Ii ty, and numerous food service faci Ii ties and outlets serving the needs of the students. Incl uded in the Cooperation's various faci Iiti es are Iounges, meeting rooms, adni nistrative and technical support offices, the officesof AssociatedStudents, Inc., and various student housing faci Ii ti es.

The Henry Madden library located on the Campus is widely regarded as exemplary in the CSU system and contains maj or col Iecti ons of books, periodicals, maps and gavernment documents in both traditional and electronic media formats. Computing laboratories are located throughout the Campus and are available to all students in all disciplines. The Campus operates the John Wright theater in which numerous maj or productions are presented annually. Television technology is applied to the Campus distance Iearning program vi a the services avai Iable through the Campus telecommunications facilities. Campus recreational facilities, which augment the academic programs, are substantial and include; gymnasiums, swimming facilities, dance studios, weight rooms, tennis and racquetbalI courts,a track and pl ayi ng fields.

The Campus is a member of the Moss Landing Marine Laboratory, operates the 4,800acre San Joaquin Experimental Range in the foothills of the Sierra Nevada rrountains, and conducts agricultural operations on several leased parcels of property in the City of Fresno. Fresno is located in a rich environment for natural resources, near Yosemite National Park, Kings Canyon National Park, and the prime watershed lands of the SanJ oaquin and Kings Rivers.

36 RISK FACTORS

Inves trrent in the Series 2002 Bonds involves certain risks. The follCMling is a discussion of certain risk factors which should be considered in evaluating the investrrent quality of the Series 2002 Bonds. This discussion does not purport to be either corrprehensive or definite. The order in which the risks are presented is not intended to reflect either the likelihood that a particular event will occur or the relative significance of such an event. Mor eover, there rmy be other risks associated with an investrrentin the Series 2002Bo nds in addition to those set forthherein.

Construction Risks

Construction of Save Mart Center; Delay in Opening. The Corporation's plan of finance is dependent on completion of Save Mart Center byt a specified time and within budget. As with all construction projects, there are many potential risks that could affect the schedule for and/or the cost of Save Mart Center. HONever, the Construction Contract provisions regarding change orders contain strict requirements intended to limit the amount of risk imposed on the Corporation for matters beyond its control, to limit changes in price and deadlines for design-related problems and to limit claims based on construction changes. Construction contractors, including the Construction Contractor, are from tirre to tirre involved in disputes relating to payments under guaranteed maximum price contracts and delays in construction schedules.

The Construction Contract allocates liability to the Corporation for cost increases and delays resulting from certain types of events, as more fully described herein under the caption "SAVE MART CENTER - Construction Contract." No assurance can be given that the costs of completing Save Mart Center will not exceed the amount of available funds or that completion of Save Mart Center will not be delayed beyond the date to which interest is capitalized under the Indenture.

Another risk potentially affecting project completion is the possibility of insolvency or bankruptcy of the Construction Contractor during construction. This risk has been miti gated byt obtaining guaranties of performance and payment from the Construction Contractor.

The Corporation has also provided for insurance to mitigate certain risks which might affect completion of Save Mart Center, including insurance to protect the interests of the Corporation and the Trustee against a del� in Save Mart Center's opening, other than delays within the Corporation's control. N otwithstandi ng these i nsurance provisions, there can be no assurance that such insurance wi11 be sufficient to � al I damages, awards or related obi igati ons incurred byt the Corporation.

Completion of Save Mart Center also involves many risks common to large construction projects such as shortages of materials and labor, work stoppages, labor disputes, weather interferences, construction accidents, unforeseen engineeri ng or environmental problems, Iand use permitting problems and unanticipated cost increases, any of which could give rise to significant delays or cost overruns. A delay in the construction of Save Mart Center could prevent Save Mart Center from opening on time, resulting in the potential material loss of revenue for the Corporation, which in turn would affect the Corporation's abiIi ty to pay debt service on the Seri es 2002B onds.

A Ithough the I ndenture contemplates the issuance of completion bonds for added costs incurred in completing Save Mart Center, the risk associated with an incomplete event center on the scheduled opening day, and the resulting loss of revenues, remains a serious concern for investors.

37 The Corporation has taken several steps to mitigate the construction risks with respect to the Save Mart Center:

Guaranteed Maxi mumPr ice. The Construction Contract has a guaranteed maximum price of $85,965,000. See the caption "SAVE MART CENTER - Save Mart Center Construction." Under the terms of the Construction Contract, the Construction Contractor is responsible for the construction of Save Mart Center. Additionally, the Construction Contractor generally assumes the risks of delays and/or construction overrunsnot covered in whole or in part byt insurance, except for certain limited risks retained byt the Corporation described belCMt.

While the Construction Contractor has generally assurned the risks of delays and/or construction overruns, there are certain risks which the Corporation has retained under the Construction Contract. For example, the Corporation retains the risk of cost overruns caused byt change orders preci pitated or caused byt the Corporation, incl udi ng changes or acceleration orders initiated byt the Corporation which may be deemed necessary byt the Corporation to the operation of Save Mart Center and change orders required if the underlying assumptions and conditions specified in the Construction Contract which affect the contract price proveto be incorrect or otherwise require adjustment. I n addition, the Corporation has al so retained the risk that change orders aff ecting the contract price may be required as a result of new legal requirements, failure byt the Corporation to obtai n necessary permits or pCMter supplies, extrerne weather conditions, catastrophic events to the site, unavailability of equiprnent and materials and any unforeseeable hazardous or archeological conditions encountered at the site. In the event that change orders are required as a result of any of such circumstances, construction costs could increase substantially and delays could occur.

Change Orders. In accordance with the Construction Contract, as a condition precedent to any change orders, the Corporation must procure the prior written consent of the Construction Monitor, which consent may be withheld unless and until the Construction Monitor certifies that (a) the Corporation has procured sufficient funds to pay for such changes, (b) such changes wi11 not materially impact the quality of Save Mart Center and (c) that the construction schedule will not be materially and adversely impact byt suchchanges.

U nder the Indenture, the Corporation agrees not to approve any change orders concerni ng Save Mart Center unless prior to such approval the Corporation has filed with the Trustee a certificate of the Corporation stating the cost of the change order and the source of funds from which such costs shal I be paid and confirmi ng that the Corporation has sufficient funds to complete Save Mart Center, as modified byt suchchange order.

Liquidated Damages. The Construction Contract provides for the payment of liquidated damages to the Corporation byt the Construction Contractor for delay if the Construction Contractor does not achieve completion milestones within the periods specified in the Construction Contract. See the caption "SAVE MART CENTER - Save Mart Center Construction. Conversely, as an added incentive to the Construction Contractor to meetconstruction deadlines, if completion of Save Mart Center is attained on or before certain milestone dates, the Construction Contractor may share in costs savings in an amount up to $900,000. See APPENDIX C - SUM MARY OF CONSTRUCT ION CONTRACT.

38 Retainage. In addition to the Iiquidated damages provisions of the Construction Contract described above, until Save Mart Center is complete, the Construction Contract provides for 5% retainage of each progress payment, with such retainage being payable upon completion of Save Mart Center.

Permits. Licenses and Approvals. The construction and opening of Save Mart Center, will be contingent on, arrnng other things, receipt by the Corporation of all required licenses, permits and approvals.

The Corporation received certification and approval of an Environmental Impact Report with respect to Save Mart Center by the Trustees in November1999. Other than submittal of a Storm Water Pollution Prevention Plan to the State Water Resources Control Board, no other building or zoning permitsare required.

Other approvals required for a project of this nature include, without linitation, state and local land-use pernits, and health and safety permits. In addition, unexpected changes or concessions required by regulatory authorities could involve significant additional costs and could delay or prevent the completion of construction, the opening of al I or part of Save Mart Center or the operation of Save MartCenter.

Pursuant to the Construction Contract, the risk of non-receipt or delay in receipt of permits and other approvals, other than certain trade contractor approvals, has been assumed by the Corporation. HONever, there can be no assurance that the Corporation wi II receive the necessary permits, licenses and approvals to complete construction of Save Mart Center or that such pernits, Iicenses and approvals wi11 be obtained wi thi n the anticipated time frame. I n addition, certain permits, licenses and approvals are required to operate Save Mart Center. The Corporation is not aware of any obstacles to the receipt of such pernits, licenses and approvals. HONever, failure to obtain such permits, licenses and approvals could have a material ad verse affect on the operation of Save Mart Center, the level of Event Center Project Revenues generated bySave Mart Center and the payment by the Corporation of the Seri es 2002 Bonds.

Geolooic. Topaqraohic and Climatic Conditions. The ability to complete construction of Save Mart Center and to operate Save MartCenter can be adversely affected by a variety of factors. Such additional factors include, without limitation, geologic conditions, topographic conditions and climatic conditions (such as extreme heat, fire hazard, earthquakes and floods). These factors have been taken into account in the design of Save Mart Center. The Construction Contract sets forth the design specifications of Save Mart Center, including the physical and environmental conditions under which Save Mart Center must be able to operate. The occurrence of environmental or physical conditions that exceed those set forth in the Construction Contract may result in damage to Save Mart Center of varying seriousness, and such damage may entail significant repair or replacement costs.

Hazardous S ubstances. In general, the ONners and operators of a parcel may be requi red by law to remedy conditions relating to releases or threatened releases of hazardous substances. The federal Comprehensive Environmental Response, Compensation and Liability Act of 1980 is the most well knCMtn and widely applicable of these laws, but State laws with regard to hazardous substances are also stri ngent and si miI ar in effect. U nder many of these Iaws, the IandONner (or operator) is obligated to remedy a hazardous substance condition of a parcel whether or not the

39 landONner (or operator) had anything to do with creating the condition or handling the hazardous substance.

It is possible that hazardous substance liabilities may arise in the future with respect to Save Mart Center resulting from the existence, currently, of a substance presently classified as hazardous which has not been released or the release of which is not presently threatened. Similarly, such liabilities may arise in the future resulting from the existence, currently, on the real property underlying Save Mart Center of a substance not presently classified as hazardous but which may in the future be so classified. Such liabilities may also arise not simply from the existence of a hazardous substance but from the method of handling such substance. A11 of these possibi Ii ties could significantly affect the value of the land upon which Save MartCenter is to be located.

Unavailability of Insurance. The Corporation is obligated under the Indenture to obtain and maintain insurance covering various risks. Although substantially all insurance obligations of the Corporation during the construction of Save Mart Center will be provided byt the Construction Contractor, there is no assurance that such insurance coverage will be available in the future or that the amounts for which the Corporation is insured or amounts that the Corporation receives under such insurance coverage will cover all losses. Additionally, certain increases in the cost of insurance may be passed through to the Corporation. If there is a total or partial Ioss of Save Mart Center, there can be no assurance that the insurance proceeds received byt the Corporation i n respect thereof wi11 be sufficient to rebuild Save Mart Center or satisfy all indebtedness of the Corporation.

Operational Risks

Save Mart Center Operator. The Corporationintends to engage a private company to manage and operate Save Mart Center. Such operator wi11 not be engaged unti I after the issuance of the Series 2002 Bonds. Failure of the Corporation to identify an adequate manager or the failure of a selected manager to properly perform relevant managerial and operational duties could materially adversely affectEvent Center Project Revenues and the ability of the Corporation to make payments on the Series 2002 Bonds.

Additional Events at Save Mart Center. Revenues generated from non-Campus events held at Save Mart Center are anticipated to be a source of Event Center Project Revenues. See the caption "REPORT OF FEASIBILITY CONSULTAN T." Failure of Save Mart Center to attract such non­ Campus events could materially adversely affect Event Center Project Revenues and the ability of the Corporation to make paymentson the Series 2002Bonds.

Continuing Governmental Requirements. FollONing completion of Save Mart Center, operation of Save Mart Center wi11 require certain state and Iocal governmental pernits or approvals, including event licenses, signage permits, advertising and parking licenses. No assurances can be given that the Corporation will be able to obtain such permits and licenses in the future. Failure to obtain any of these permits and licenses could limit the Corporation's ability to generate revenues which are dependent on the Corporation's ability to use Save Mart Center for entertainment and sporting activities.

40 Financial Risks

Non-Recourse Obligation; Abilitv to Service Debt. FollONingthe deliveryof the Series 2002 Bonds, the Corporation wi II be dependent on the Event Center Project Revenues generated through operation of Save Mart Center for payment of the Series 2002 Bonds. The consequences of the Corporation's non-recourse debt structure for the Series 2002 Bonds include, but are not limited to, the follONing: (1) a substantial portion of the Corporation's cash from Save Mart Center operations must be dedicated to the payment of the Series 2002 B onds, ( 2) the Corporation's abiIi ty to obtain additional debt financing in the future for working capital, capital expenditures, development financing or other purposes is limited, (3) the Corporation cannot obtain financing from equity investors, and (4) the Corporation may be vulnerable, and mayhave difficulty responding, to adverse changes in the econonly'. Anyof the foregoing could have a material and adverseaffect on the ability of the Corporationto make payments on the Seri es 2002Bonds.

Revenue Projections. The conclusions contained in the Feasibility Report, while presented with specificity, are based upon a number of estimates and assumptions which, though considered reasonable by the Corporation and Feasibility Consultant, are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond the control of the Corporation.

The conclusions set forth in the Feasibility Report are forward-f ooking statements, as such term is defined in the Securities Act of 1933, as amended, and reflect certain significant assumptions concerning future events and circumstances. The Feasibility Consultant relied upon the information provided by the Corporation and others for purposesof preparing the underlying assumptions and the resulting conclusions. The assumptions set forth in the Feasibility Report are material in the development of the conclusions, and variations in the assumptions may produce substantial ly different conclusions. See "APPENDIX A- FEASIBILITY REPORT."

If one or more of the assumptions made by the Feasibility Consultant proves incorrect, the levels of Event Center Project Revenues generated by Save Mart Center and the payment by the Corporation of the Series 2002 Bonds could be materially adversely affected.

Actual operating results achieved during the projection periodmay varyfrom those presented in the forecast, and such variations may bematerial. After the issuance of the Series 2002 onds,B neither the Corporation, Feasibility Consultant, nor any other person has any obligation to, nor do they intend to, provide the Trustee or Series 2002 ondONnersB with updated reports or revised projections comparing the projections with actual operating results later achieved by Save Mart Center. Accardi ngly, no assurances are given and no representations are made that any of the assumptions are correct, that the conclusions wi11 be achieved or that the beliefs and the forward� ooking statements expressed herein ( or incl uded i n the F easi bi Ii ty Report) wi11 correspond to actual results.

The Corporation has taken steps to mitigate risks associated with the insufficiency of Event Center Project Revenues to pay principal and interest on the Series 2002 Bonds. The Corporation has fundedcapitalized interest with respect to the Series 2002 Bonds in the amount of approximately $7,841,989. 74 from proceeds of the Series 2002 Bonds. This amount, as well as the interest earnings thereon, wi11 be avai Iable to fund estimated i nterest on the Seri es 2002 ondsB to February1 5, 2004. In addition, the arrount of $6,616,867.00 will be deposited into the Reserve Accounts held by the Trustee under the Indenture which wi11 be avai Iable to pay princi pal of and interest on the Seri es

41 2002 Bonds in the event that the Event Center Project Revenues are insufficient therefor, as described under the caption "SECURITY FOR THE SERIES 2002 BON DS - Reserve Accounts. "

Failure to Realize Event Center Project Revenues. The projected operating cash flCMt included under the caption "REPORT OF FEASIBILITY CONSULTANT" assumes that income generated from Arena Builder Licenses, Luxury Suite Licenses, Personal Seat Licenses, the Pepsi Agreement, the Cal Fed Agreement, the Pac Bell Agreement, the Kroeker Agreement, the CMC Agreement and the IBM Agreement will represent a significant revenue source. Although approximately 85% of available Arena Builder Licenses and approximately 8B>/o of available Luxury Suite Licenses have been sold and the Pepsi Agreement, the Cal Fed Agreement, the Pac Bell Agreement and the Kroeker Agreement have been entered into, failure of licensees or sponsors to pay amounts due to the Corporation could materially adversely affect the abiI ity of the Corporationto make paymentson the Series 2002 Bonds.

Availability of Revenues During Construction. Costs associated with the construction of Save MartCenter will be paid, in part, from revenues the Corporation anticipates receiving prior to the completion of Save Mart Center, including revenues generated from sponsorships and naning rights agreements, the sale of various seat licenses and private fundraising, all as described under the caption "ESTIMATED SOURCES AND USES OF FUNDS." Failure to realize such revenues during construction could affect the Corporation's ability to pay amounts due under the Construction Contract and, ultimately, delay the completion of Save Mart Center. Any such delay could have a material adverse impact on the Corporation's ability to pay debt service on the Series 2002Bonds.

Miscellaneous Risks

Continuing Popularity of Fresno State Basketball. The financial success of the Save Mart Center depends to a significant extent on the continuing popularity of Fresno State basketball. Spectator attendance is affected by numerous factors, i ncludi ng competitiveness of the Fresno State basketbalI team, the price of admission, the convenience of transportationfaci Ii ties and avai Iabi Ii ty of parking and competition from other events. Many of these factors are beyond the control of the Corporation.

NCAA Sanctions. The various athletic teams of the Campus are subject to certain rules and regulations imposed by the National Collegiate Athletic Association (the "NCAA"). Should the Campus violate anysuch rules and regulations, the NCAA may, at its discretion, choose to sanction the Campus. Such sanctions can include, but are not limited to, reducing the number of athletic scholarships the Campus may offer, imposing monetary fines or prohibiting athletic teams from certain competitions. Although the NCAA has never imposed sanctions upon the Campus, any future sanctions could materially adversely affect the projections contained in the Feasibility Consultant Reportand materially adversely affect the ability of the Corporationto make payments on the Series 2002 Bonds.

Payment of Subordinate Bonds After Senior Bonds. Pursuant to the Indenture, the Corporation shal I make payment of principal and interest on the Senior B onds, shal I replenish the Senior Reserve Account for any draws therefrom and shall make deposits into the Capital Replacement Account prior to the payment of pri nci pal and i nterest on the S ubordinate B onds. Any insufficiency in Event Center Project Revenues may result in nonpaymentof principal and interest on the S ubordinate B onds prior to nonpayment of anypri nci paland interest on the Senior B onds and the funding of the Senior Reserve Account and the Capital Replacement Account. Under the Indenture,

42 nonpaymentof the Subordinate Bonds doesnot necessarily result in either an Event of Default or in the acceleration of the Subordinate Bonds. Failure byt the Corporation to comply with certain fi nanci al covenantsspecified i n the Indenture, including the rate covenant, doesresult in an Event of Default under the Indenture. U ponan Event of Default, acceleration of the Subordi nate B onds may be directed byt the Trustee only with the consent of the majority of the CMtners of the Senior Bonds and S ubordinate B onds. U pon an Event of Default, interest on the Seri es 2002 B onds wi 11 conti nue to accrue at the rates set forth on the i nside front cover of this Official Statement. For a further description of the Events of Default and remedies provided in the Indenture for the Subordinate Series 2002 Bonds, see "APPENDIX B - SUMMARIES OF CERTAIN PROVISIONS OF THE INDENTURE AND GROUND LEASE - THE INDENTURE - Events of Default and Remedies." Limits on Remedies Under the Deed of Trust (Anti-Deficiency Laws). Several California statutes limit the remedies of a beneficiary under a deed of trust such as the Deed of Trust. Under one statute, if the beneficiaryexercises its pcMterof sale (i.e., accomplishes the foreclosure bytmeans of a nonjudicial trustee's sale), the beneficiary may not obtain a deficiency judgment for the difference between the amount of the debt and the amount realized at the sale. Another statute, commonly knCMtn as the "one-form-of-action" rule, requires the beneficiary to exhaust the security under the deedof trust bytforeclosure and prohibits anypersonal action against the trustor on the debt other than a deficiency judgment follCMting ajudicial foreclosure. A third statutory provision limits any deficiency judgment obtained byt the beneficiary folI CMti ng a judicial sale to the excess of the outstanding debt overthe fair marketvalue of the property at the timeof sale, therebyt preventing a beneficiary from obtaining a large deficiency judgment against the debtor as a result of ICMt bids at the judicial sale. Thus the choice of method of foreclosure ( nonjudicial trustee' s sale versus judicial foreclosure) could affect the amount that may be realized from the sale of the Event Center Project and the CorporationfollCMting a default. Additionally, if the Trusteewere to take direct action on the debt or exercise other rights against the Corporation rather than foreclosing the deed of trust, the benefit of the real propertysecurity would be ostI under the "one-form-of-action" rule. Enforceabi Ii ty of Financing Documents. Recei pt of paymentsCMted to CMtnersof Series 2002 Bonds depends upon the enforceability of various instruments and agreements. The various legal opinions to be deliveredconcurrently with the delivery of the Series 2002 Bonds will bequalified as to the enforceabiIi tyof various instruments and agreements becauseof Iimi tations imposedbyt niU ted States federal and state Iaws affecting remediesand other matters, and bytbankruptcy, reorganization or other laws affectingthe enforcementof creditors'rights generally. Enforceability of Remedies; Bankruptcy. The remedies available to the Trustee and Bondhol ders upon an Event of Default under the Indenture are in many respects dependent upon regulatory and judicial actions which are often subject to discretion and delay. Under existi ng Iaws and judicial decisions, the remediesprovided underthe Indenture or other documentsmay not readily be available or may be limited. A court may decide not to order the specific performance of the covenants contained in such documents. Although the Corporation has no present intention to institute bankruptcy proceedings or protection under any other debtor relief laws, it may not be prevented from instituting such proceedings or seeking such relief or protection. The extent, if any, to which payments on the Seri es 2002 Bonds would continue to be made in the event of bankruptcy of the Corporation, and the availability of any of the remedies provided byt the Indenture in such event, cannot bepredicted.

43 FORWARD LOOKING STATEMENTS Certain statementsincl uded or incorporated byreference in this OfficialStatement constitute "forward-fooking statements'' within the meaning of the United States Private Securities Litigation Reform Act of 1995, Section 21 E of the UnitedStates Securities Exchange Act of 1934, as amended, and Section 27A of the United States Securities Act of 1933, as amended. Such statements are generally identifiable by the terminology used such as "plan," "expect," "estimate," "project," "budget'' or other similar words. Such forward-fooking statements include, but are not limited to, certain statements contained in the information under the captions "SAVE MART EVENT CENTER," "THE REPORT OF FEASIBILITY CONSULTANT," "REPORT OF FEASIBILITY CONSULTANT" and "PROJECTED DEBT SERVICE COVERAGE." THE ACHIEVEMENT OF CERTAIN RESULTS OR OTHER EXPECTATIONS CONTAINED IN SUCH FORWARD-lOOKING STATEMENTS INVOLVE KNOWN AND UNKNOWN RISKS, UNCERTAINTIES AND OTHER FACTORS WHICH MAY CAUSE ACTUAL RESULTS, PERFORMANCE OR ACHIEVEMENTS DESCRIBED TO BE MATERIALLY DIFFERENT FROM ANY FUTURE RESULTS, PERFORMANCE OR ACHIEVEMENTS EXPRESSED OR IMPLIED BY SUCH FORWARD-lOOKING STATEMENTS. CONTINUING DISCLOSURE The Corporationhas entered into a Continuing Disclosure Agreement, dated the delivery date of the Seri es 2002B onds ( the "Conti nui ng Disci osure Agreement'') for the benefitof the holders and beneficial CMtners of the Series 2002 B onds to provide certai n fi nanci al inf ormation and operating data relati ng to the Corporation by 1 days80 folI CMti ng the end of the Corporation's Fi seal Y ear (currently its Fiscal Year ends on the last day of June) (the "Annual Report''), commencing with the report for Fiseal Y ear ended J une 30, 2002. The Corporation has agreed to provide notices of the occurrence of certain enumerated events, if material. The Annual Report will be filed with each Repository identified in the Continuing Disclosure Agreement. The notices of material events will be filed with the Repositories or with the Municipal Securities Rulemaking Board. The specific nature of the informationto becontai ned in the Annual Reportand the notice of material eventsis set forth in "APPENDIX F -FORM OF CONTINUING DISCLOSURE AGREEMENT" hereto. The Continuing Disclosure Agreement has been entered into in order to assist the Underwriters in complying with Rule 15c2-12(b)(S) promulgated under the Securities Exchange Act of 1934. Pursuant to the Corporation's existing continuing disclosure obligation with respectto those certain California State University, Fresno Association, Inc., Auxiliary Organization Refunding Revenue Bonds (Student Residence Project), Series 2001, the Corporation was required to file the first annual report on J anuary 1, 2002. Such annual report was fi Ied on J anuary 31, 2002. The Corporation is not currently in default under any continuing disclosure undertakings entered into pursuant to the provisions of Rule 15c2-12(b)S. LITIGATION Although the Corporation is occasionally named as a defendant in lawsuits arising in the normal course of the Corporation's business operations, there is not nCMt pending or, to the knCMtledge of the Corporation, threatened, any litigation restraining or enjoining the issuance or delivery of the Seri es 2002 Bonds or questioning or affecting the validity of the Seri es 2002 Bonds or

44 the proceedings or authority under which they are to be issued. In addition, there is no Ii ti gation pending or, to the Corporation's knCMtledge, threatened which in any rranner questions the right of the Corporationto enter into the Indenture or to secure the Series 2002 B onds in the rranner provided in the Indenture, or wherein an unfavorable ruli ng, decision or fi nding would have a rraterial adverse effecton the abiIi ty of the Corporationto paydebt serviceon the Seri es 2002B onds when due. LEGAL MATTERS The validity of the Series 2002 Bonds and certain other legal rratters are subject to the approving opinion of Orrick, Herrington & Sutcliffe LLP, Bond Counsel. A complete COP{ of the proposedform of Bond Counsel opinion is contained in Exhibit D hereto. Bond Counsel undertakes no responsibility to any Bondholder for the accuracy, completeness or fairness of this Official Statement. Certain legal rratters will be passed upon for the Corporation byt its counsel, John M. Melikian, Esquire, for the Construction Contractor byt its assistant general counsel and for the Underwriters byttheir counsel, Stradling Y occaCarlson & Rauth, a Professional Corporation. TAX MATTERS In the opinion of Orrick, Herrington & Sutcliffe LLP (" Bond Counsel"), based upon an analysis of existi ng Iaws, regulations, ruli ngs and court decisions, and assuming, arrong other rratters, the accuracy of certain representations and compliance with certai n covenants, interest on the Seri es 2002 B onds is excl uded from gross income for federal income tax purposes under Section 103 of the Internal Revenue Code of 1 986 ( the "Code") and is exempt from alI taxation in the State of California other than estate and generation skipping transfer taxes. Bond Counsel is of the further opi ni on that interest on the Series 2002 B onds is not a specific preference i tern for purposes of the federal individual or corporate alternative minimum taxes, although Bond Counsel observes that such interest is included in adjusted current earnings when calculating corporate alternative minimum taxable income. A complete COP{ of the proposed form of opinion of Bond Counsel is set forth in APPENDIX D hereto. The Code imposes various requirements that must be met in order for interest on the 2002 Bonds to be excluded from gross income for federal income tax purposes. The Corporation rm.de representations related to certain of these requirementsand has covenanted to comply with certain of these requirements. I naccuracy of these representations or faiI ure to comply with these covenants may result in interest on the Series 2002 Bonds being included in gross income for federal income tax purposes, possibly from the date of original issuance of the Series 2002 Bonds. The opinion of Bond Counsel assumes the accuracy of these representations and cornpliance with these covenants. B ond Counsel has not undertaken to determine (or to i nf orm any person) whether any actions taken (or not taken) or events occurring (or not occurring) after the date of issuance of the Seri es 2002 Bonds mayad versely affect the value of, or the tax status of interest on, the Seri es 2002Bonds. Certain requirements and procedures contained or referred to in the I ndenture, the Tax Certificate, and other relevant documents rray be changed and certain actions (including, without Iimi tation, defeasance of the Series 2002 B onds) rray be taken or omitted under the ci rcumstances and subject to the terms and conditions set forth in such documents. Bond Counsel expresses no opinion as to any Series 2002 Bond or the interest thereon if any such change occurs or action is taken or onitted upon the advice or approval of bond counsel other than Orrick, Herrington & SutcliffeLLP.

45 A Ithough B ond Counsel is of the opinion that interest on the Series 2002 B onds is excl uded from gross income for federal income tax purposes and is exempt from al I taxation in the State of California other than estate and generation ski ppi ng transfer taxes, the CMtnership or disposi ti on of, or the accrual or receipt of interest on, the Seri es 2002 Bonds may otherwise affect a Beneficial Owner's federal or state tax liability. The nature and extent of these other tax consequences will depend upon the particular tax status of the Beneficial Owner or the Beneficial Owner's other items of income or deduction. Bond Counsel expresses no opinion regarding any such other tax consequences.

In addition, no assurance can be given that any future Iegi slati on, including amendments to the Code, if enacted into law, or changes in interpretation of the Code, will not cause interest on the Series 2002 Bonds to be subject, directly or indirectly, to federal income taxation, or otherwise prevent CMtners of the Series 2002 Bonds from realizing the full current benefit of the tax status of such interest. Prospective purchasers of the Seri es 2002 B onds should consult thei r CMtn tax advisers regarding any pending or proposed federal tax legislation. Further, no assurance can be given that the introduction or enactment of any such future Iegi slati on, or any action of the Internal Revenue Service(" IRS"), including but not limited to regulation, ruling, or selection of the Series 2002 Bonds for audit examination, or the course or result of any IRS exanination of the Seri es 2002 onds,B or obi igati ons which present si mi Iar tax issues, wi11 not affect the market price for the Series 2002 Bonds.

UNDERW RITING

The Underwri ters have agreed to purchase the Series 2002 onds B from the Corporation at a purchase price of $72,638,372.40 (representing the aggregate principal amount of the Series 2002 Bonds, less an Underwriters' discount of $1,321,062.50 and net original discount of $515,565.10), plus accrued interest. The Underwriters reserve the right to join with dealers and other underwriters in offering the Series 2002 Bonds to the public. The obligation of the Underwriters to accept delivery of the Series 2002 Bonds is subject to the various conditions of the bond purchase agreement.

RATINGS

It is expected that Moody's Investors Service ("Moody's") and Fitch, Inc. ("Fitch") will assign ratings of " B aa3" and " B B B --2' respectivelyto the Senior Seri es 2002 ondsB uponthe issuance and delivery of the Senior Series 2002 Bonds. It is expected that Moody's and Fitch will assign ratings of "Ba1" and "BB +' respectively to the Subordinate Series 2002 Bonds upon the issuance and delivery of the Subordinate Seri es 2002 B onds. Such rati ngs reflect only the vi e1vs of Moody's and Fitch and anydesired explanation of the significance of each such rating should be obtained from either Moody's or Fitch. If given, there is no assurance such ratings would continue for any given period of time or that such ratings would not berevised dCMtnward or withdrawn entirely by Moody's or Fitch, if in their judgment circumstances so warrant. Anysuch dCMtnward revision or withdrawal of the ratings mayhave an adverse effecton the market price of the Seri es 2002 Bonds.

46 ADDITIONAL MATTERS

The references herein to the I ndenture, the Project Documents and Lease are brief outl ines of certain provisions thereof. Such outlines do not purport to be complete and for full and complete statements of the provisions thereofreference is madeto each such document. Copies of the drafts of such documents are, and fol ICMti ng delivery of the Seri es 2002 B onds copies of such documents wi11 be, on fiI e at the principaloffice of the Trustee.

Neither any advertisement of the Series 2002 Bonds nor this Official Statement is to be construed as constituting an agreement with the purchasers of the Series 2002 Bonds. So far as any statements are made in the Official Statement i nvolving esti mates, projections or matters of opinion, whether or not expressly so stated, they are i ntended merely as such and not as representations of fact.

The attached Appendices are integral parts of this Official Statement and should be read together with al I of the foregoing statements.

The execution and delivery of this Official Statement dated as of the date set forth on the cover page has been duly authorized by the Corporation.

CALIFORNIA STATE UN IVERSITY , FRESNO ASSOCIATION, INC.

By: ls/Deborah S. Adishian-Astone Executive Director

47 APPENDIX A FEASIBILITY REPORT

A-1 SAVE MART CENTER FEASIBILITY STUDY FRESNO, CALIFORNIA

PREPAREDFOR CALIFORNIA STATE UNIVERSITY, FRESNO ASSOCIATION, INC.

PREPARED BY ECONOMICS RESEARCH ASSOCIATES

JANUARY 16, 2002

ERA PROJ ECT NO. 14042 January 16, 2002

Dr. Benjamin Quillian Chairman of the Board California State University, Fresno Association, Inc. 5241 North Maple Avenue (M-S TA52) Fresno, CA 93740-8027 ERA No. 14042

We have prepared a financialfeasibility study of the proposed Save Mart Center to be located in the campus of California State University, Fresno (Fresno State). California State University, Fresno Association, Inc. (Association) is in the process of preparing for the construction of the Save Mart Center. The Save Mart Center, which recently had its ground breaking, is intended to be a state-of-the-art multi-purpose event center with approximately 16,000 seats, 32-private luxury suites and 1, 108 club seats (Arena Builder Seats). It will be the home to Fresno State athletic events including the Fresno State men's and women's basketball teams, and will also serve the entire San Joaquin Valley region with athletic, cultural and entertainment events. In addition to the financial feasibility study, we have prepared stress tests based on changes to certain assumptions of the Association, which are presented in the analysis.

This analysis was undertaken to evaluate the ability of the Association to achieve the projected cash flow after debt service forthe first five years of operations associated with the proposed issuance of approximately $68,825,000 in Senior Lien Revenue Bonds (Senior Bonds) and $5,000,000 in Subordinate Lien Revenue Bonds (Subordinate Bonds, together with the Senior Bonds, the Bonds), a public offering which is anticipated to be underwritten by Salomon Smith Barney in January 2002. The Senior Bonds and Subordinate Bonds are assumed to have annual interest rates of 6.00 percent and 7.00 percent respectively during the construction period and throughout the forecast period. This analysis was prepared forthe purpose of assisting in the offering of the Bonds and should not be used for any other purpose.

The Association anticipates that construction of the Save Mart Center, which began in November 2001, will be substantially completed by November 2003.

Our procedures included analysis of:

• Project history, obj ectives, timing and financing

• The futuredemand forthe Project, including consideration of: Economic and demographic characteristics of the Fresno area Historical utilization of Selland Arena Historical attendance of Fresno State's men's basketball and various minor leagues Other existing and planned arenas, stadiums, and other public assembly facilities in the area

10990 Wilshire Boulevard, Suite 1500, Los Angeles, CA 90024 (310) 477-9585 FAX (310) 478-1 950 www.econres.com ERA is affiliated with Drivers Jonas Los Angeles San Francisco San Diego Chicago Washington DC London Dr. Benjamin Quillian California State University, Fresno ERA No. 14042 January 16, 2002 Page 2

Interviews with the Association Potential utilization of the Project for sporting and entertainment events, concerts, and family shows Marketing of luxury suites, Arena Builder Seats, Personal Seat Licenses, naming rights, private fundraising/corporate sponsorships, and advertising

• Operating data for other comparable arenas

• Staffing requirements, marketing programs and other operating considerations

The financial forecast, which is based on assumptions provided by, or reviewed with and approved by, the Association, is for the first five years of operation. The forecast consists of: • Consolidated forecastcash flow after debt service • Summary of significant forecast assumptions and notes

Our analysis included such procedures as we considered necessary to evaluate the Association's assumptions used in the preparation of the financial forecast. The forecast is on a pre-income tax basis. The Association has represented that income taxes will not materially impact cash flow. We have not analyzed or reviewed any income tax projections, and we do not express any conclusions regarding how income taxes may impact cash flow and debt service payments.

The interest rate, principal payments and other financing assumptions are described near the conclusion of the section entitled "SectionV - Financial Forecast'. If actual interest rates, principal payments, and funding requirements are different from those assumed, the amount of the Bonds issued and debt service requirements would need to be adjusted accordingly. If such interest rates, principal payments, and funding requirements are higher than those assumed, such adjustments could adversely affect the financial forecast.

Our conclusions are presented below:

• The underlying assumptions provide a reasonable basis for the Association's financial forecast, assuming that all items of a material financial nature remain in effect throughout the forecast period, and that satisfactory agreements for operating guarantees are executed. Even were that to occur, there will be differences between the projected and actual results, because events and circumstances frequently do not occur as expected, and those differences may be material. Dr. Benjamin Quillian California State University, Fresno ERA No. 14042 January 16, 2002 Page 3

• The accompanying financial forecast indicates that sufficient funds could be generated to meet the Project's operating expenses, working capital needs, and the debt service requirements associated with the proposed $73.8 million financing, during the financial forecast period. However, the achievement of any financial forecast is dependent upon future events, the occurrence of which cannot be assured.

The conclusions expressed herein are based on the effect that various assumptions may have on economic performance and the ability to service debt for the proposed facility. However, economic performance is influenced by many factors which cannot be foreseen. Other significant influencing factors, many of which are unquantifiable and unpredictable, include weather, the general state of the local and regional economy, changing laws governing benefits and taxes, construction delays, cost overruns, labor availability and costs, ability to successfully negotiate and execute all necessary agreements on terms satisfactory to the Association, successful financing of all elements of the Project, environmental factors, changing competitive circumstances, management strength and marketing approach, continued availability of parking and other support services, quality and effectiveness of design, market appeal and community support of the Fresno State sports teams and other program content of the facility, and other intangible circumstances. Under differing scenarios, these other significant influencing factors can have either a positive or negative effect on economic performance. Unless expressly identified, we have not considered such other significant influencing factors.

The scope of our research consisted primarily of a review of the Association's internal documentation, assumptions, and financial projections; and gathering and analysis of data from secondary sources, supplemented by interviews with representatives of the Association and other individuals involved in sports and stadium operations. No responsibility is assumed for inaccuracies in reporting by the Association, its agents and representatives or any other data source used in preparing or presenting this study.

We make no warranty or representation that any of the projected values or results contained in the Association's projections or the stress tests will actually be achieved.

Economics Research Associates is not an accounting firm and has not followed the procedures established by the American Institute of Certified Public Accountants in connection with prospective financial statements. Dr. Benjamin Quillian California State University, Fresno ERA No. 14042 January 16, 2002 Page 4

This document and all analyses and conclusions contained herein are qualified in their entirety by, and should be considered in light of, these limitations, conditions and considerations.

1s1 E conorrics Research Associates ECONOMICS RESEARCH ASSOCIATES TABLE OF CONTENTS

Section Page

COVER LETTER

TABLE OF CONTENTS

I EXECUTIVE SUMMARY...... I - 1 Project Background ...... I - 1 Save MartCenter ...... I - 1 Proj ect Site ...... I - 2 Market Area Analysis ...... I - 2 Competitive and Comparable Facilities/Tenants ...... 1-3 Financial Forecast ...... 1-5 General Revenue Financial Forecast Findings ...... 1-5 Debt Service Coverage ...... 1-9 Sensitivities ...... 1-9

II PROJECT BACKGROUND AND SCOPE OF SERVICES ...... II - 1 Project Background ...... II - 1 Scope of Services ...... II - 1 Market Area Analysis ...... II - 2 Competitive and Comparable Facilities/Tenants ...... II - 2 Financial Forecast ...... II - 4

III MARKET AREA ANALYSIS ...... III - 1 California State University, Fresno ...... III - 1 Fresno State Athletics...... III - 2 National Collegiate Athletic Association (NCAA) ...... III - 4 NCAA Enforcement/Infractions ...... III - 5 Local Residential Market ...... III - 6 Total Population ...... III - 8 Age Stratification ...... III - 9 Education ...... 111-11 Race and Ethnicity ...... 111-12 Income and Employment Characteristics ...... 111-13 Transportation ...... 111-18 Highway Transportation ...... 111-18 Air Transportation...... 111-19 Rail Transportation ...... 111-20 Bus Transportation ...... 111-20 Comparable MSA Analysis ...... 111-20 Cost of Living ...... 111-21 Seating Inventory ...... 111-23

Economics Research Associates CaliforniaSta te University, F resno Association,I nc. ERA No. 14042 Page i TABLE OF CONTENTS (Continued)

Section Page

III Competitive Arena Analysis ...... 111-25 Selland Arena ...... 111-25 Regional Competitive Assessment - 150 Mile Radius . 111-25 Regional Competitive Assessment -250 Mile Radius .. 111-26 Comparable Market Analysis ...... 111-28 Ten-Mile Market Ring ...... 111-30 Twenty-Five Mile Market Ring ...... 111-30 Forty-Mile MarketRing ...... 111-33 Arena Seating Inventory...... 111-33

IV COMPETITIVE AND COMPARABLE FACILITIES/ TENANTS ...... IV - 1 Competitive Fresno Facilities ...... IV - 1 Selland Arena ...... IV - 1 Fresno Convention Center ...... IV - 2 Class-AAA Baseball League Stadium ...... IV - 2 The Big Fresno Fairgrounds ...... IV - 2 Comparable United Stated Arenas ...... IV - 2 Alltel Arena - (University of Arkansas-Little Rock). ... IV - 3 Cintas Center - (Xavier University)...... IV - 4 DeSoto County Civic Center ...... IV - 4 New Orleans Arena - (Tulane University) ...... IV - 4 United Spirit Arena - (Texas Tech University)...... IV - 5 Family Arena ...... IV - 5 First Union Arena ...... IV - 5 Sovereign BankArena ...... IV - 6 Schottenstein Center - (Ohio State University) ...... IV - 6 Mitchell Center - (University of South Alabama) ...... IV - 6 The Centennial Garden- (CaliforniaState University, Bakersfield) ...... IV - 7 Bi-Lo Center ...... IV - 7 Crown Coliseum ...... IV - 8 The "E" Center ...... IV - 8 Cox Arena - (San Diego State University) ...... IV - 8 Van Andel Arena ...... IV - 9 Spokane Arena ...... IV - 9 World Arena ...... IV - 9 Mark of the Quad Cities ...... IV- 10 The Pyramid Arena- (University of Memphis) ...... IV- 10 Pepsi Arena - (Siena College) ...... IV-11

Economics Research Associates CaliforniaSta te University, F resno Association,I nc. ERA No. 14042 Page ii TABLE OF CONTENTS (Continued)

Section Page

IV WesternAthletic Conference (WAC) ...... IV-11 Potential Additional Anchor Tenants/Sports Leagues ...... IV- 12 West Coast Hockey League ...... IV- 12 Continental Basketball Association ...... IV- 14 National Basketball Development League ...... IV-15 Arena Football 2 ...... IV- 16 National Indoor Football League ...... IV-17 Major Indoor Soccer League ...... IV- 18 Concert and Other Venue Event Data ...... IV-20

v FINANCIAL FORECAST...... V - 1 Potential Utilization of the Proposed Arena ...... V -2 Estimated Number and Type of Events ...... V -2 Estimated Paid Attendance ...... V - 3 Arena Operating Revenue Assumptions ...... V -4 Event Related Revenues ...... V - 5 Contractually Obligated Income ...... V-10 Other Revenues ...... V- 17 Arena Operating Expense Assumptions...... V -1 7 Total Arena Operating Expenses...... V-20 Other Expenses...... V-21 Summary of Financial Results ...... V-23 Debt Service Coverage...... V-25 Sensitivity Analyses...... V-25 Sensitivity #1 ...... V-26 Sensitivity #2 ...... V-26 Sensitivity #3 ...... V-27 Sensitivity #4 ...... V-27 Sensitivity #5 ...... V-28 Sensitivity #6 ...... V-28 Sensitivity #7...... V-29 Sensitivity #8...... V-29 Sensitivity #9 ...... V-30

Appendix A - Cash Flow

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Number

I - 1 SUMMARY OF PROJECTED SAVE MART CENTER CASH FLOW...... 1-7

I - 2 PROJECTED SAVE MART CENTER CASH FLOW...... I - 8

1-3 DEBT SERVICE COVERAGE...... 1-9

III - 1 FRESNO STATE STUDENT ENROLLMENT, (1920 - 2005) ...... III - 2

III - 2 HISTORIC ATHLETIC ATTENDANCE...... III - 3

III - 3 GENERAL POPULATION AND HOUSEHOLD CHARACTERISTICS, 1999 and 2004 ...... III - 9

III - 4 POPULATION BY AGE, 1999 ...... 111-11

III - 5 FRESNO MSA EDUCATION DISTRIBUTION, 1999 ...... 111-12

III - 6 POPULATION BY RACE, 1999 ...... 111-13

III - 7 INCOME CHARACTERISTICS, 1999 and 2004 ...... 111-15

III - 8 FRESNO MSA EMPLOYMENT BASE ...... 111-16

III - 9 MAJOR EMPLOYERS IN FRESNO MSA...... 111-18

III - 10 54IH TO 74IH RANKED METROPOLITAN STATISTICAL AREAS (MSA) ...... 111-21

III - 11 COST OF LIVING INDEX SUMMARY - 54 TH TO 7 4T H MSAs ...... 111-23

III - 12 SUMMARY OF THE TOTAL SEAT INVENTORY FOR THE 54IH TO 74IH RANKED MARKETS ...... 111-24

III - 13 ARENA SEATING INVENTORY -150 MILE RADIUS ...... 111-26

III - 14 ARENA SEATING INVENTORY -250 MILE RADIUS ...... 111-27

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Number

III - 15 MAJOR INDOOR STADIUS AND ARENAS - 250 MILE RADIUS ...... 111-28

III - 16 COMPARABLE ARENAS ...... 111-29

III - 17 IO-MILE MARKET RING...... 111-30

III - 18 25-MILE MARKET RING...... 111-31

III - 19 40-MILE MARKET RING...... 111-34

III - 20 TOTAL SEAT INVENTORY FOR THE COMPARABLE ARENA MARKETS ...... 111-35

IV - 1 COMPARABLE ARENAS ...... IV- 3

IV - 2 WESTERN ATHLETIC CONFERENCE MEMBER SCHOOLS AND ARENAS ...... IV- 12

IV - 3 WEST COST HOCKEY LEAGUE ...... IV-13

IV - 4 WCHL HISTORICAL ATTENDANCE ...... IV-14

IV - 5 CONTINENTAL BASKETBALL ASSOCIATION ...... IV-14

IV - 6 NATIONAL BASKETBALL DEVELOPMENT LEAGUE ...... IV-15

IV - 7 ARENA FOOTBALL 2 ...... IV-17

IV - 8 NATIONAL INDOOR FOOTBALL LEAGUE ...... IV- 18

IV - 9 MAJOR INDOOR SOCCER LEAGUE ...... IV-20

IV - 10 SELECTED MID-SIZE CONCERTS ...... IV-21

IV -11 SELECTED MID-SIZE EVENTS ...... IV-25

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Number

V - 1 COMPARABLE ARENA FACILITIES EVENT BREAKDOWN (1) ...... V - 3

V -2 BASE CASE EVENTS AND ATTENDANCE, Year 1 ...... V -4

V - 3 BASE CASE EVENTS AND AVERAGE TICKET PRICES, Year 1...... V - 6

V -4 RENTAL RATES (SAVE MART CENTER RECEIVES) ...... V - 7

V - 5 COMPARABLE ARENA CONCESSION PER CAPITAS ...... V - 8

V - 6 BASE CASE GROSS CONCESSION/NOVELTYPE R CAPITAS, Year 1 ...... V - 8

V - 7 SAVE MART CENTER, Luxury Suite Prices ...... V-10

V - 8 SAVE MART CENTER, Arena Seat Builder Prices ...... V-11

V -9 SAVE MART CENTER, Private Fundraising ...... V-14

V -10 SAVE MART CENTER, Corporate Sponsorships...... V-15

V -11 COMPARABLE ARENAS, Full-Time Employees ...... V-17

V -12 COMPARABLE ARENAS, Staffing Expense ...... V-18

V -13 COMPARABLE ARENAS, Utility Expenses...... V-19

V -14 COMPARABLE ARENAS, Total Expenses...... V-21

V -15 DEBT SERVICE SCHEDULES ...... V-22

V -16 SUMMARY OF BASE CASE - FRESNO STATE ATHLETICS AND ADDITIONAL MINOR LEAGUE TENANT ...... V-23

V -17 BASE CASE - FRESNO STATE ATHLETICS AND ADDITIONAL MINOR LEAGUE TENANT...... V-24

V -18 DEBT SERVICE COVERAGE...... V-25

Economics Research Associates CaliforniaSta te University, F resno Association,I nc. ERA No. 14042 Page vi LIST OF FIGURES

Number

III - A COMPARISON OF AGE DISTRIBUTION IN THE TOTAL MARKET AREA AND U.S., 1999 ...... 111-10

III - B COMPARISON OF INCOME DISTRIBUTION IN THE TOTAL MARKET AREA AND U.S., 1999 ...... 111-14

Economics Research Associates CaliforniaSta te University, F resno Association,I nc. ERA No. 14042 Page vii 01 /16;02

Section I

EXECUTIVE SUMMARY

PROJECT BACKGROUND California State University, Fresno Association, Inc. (Association) is in the process of preparing for the construction of the Save Mart Center at Fresno State (Save Mart Center), which is to be located on the campus of California State University, Fresno (Fresno State). Economics Research Associates (ERA) was retained by the Association in February 2001 to perform an analysis on the proposed Save Mart Center to be located on the campus of Fresno State. Our tasks included:

• Market Area Analysis • Competitive and Comparable Facilities/Tenants • Financial Forecast

Save Mart Center The Save Mart Center, which recently had its ground breaking, is intended to be a state-of­ the-art multi-purpose event center with approximately 16,000 seats, 32-private luxury suites and 1, 108 club seats (Arena Builder Seats). It will be the home to Fresno State athletic events including the Fresno State men's and women's basketball teams and will also serve the entire San Joaquin Valley region with athletic, cultural and entertainment events.

The total costs of developing, constructing and financing the Save Mart Center are projected to total $110.6 million. The proj ect will be financed primarily by approximately $68.8 million of senior lien revenue bonds (Senior Bonds) and $5.0 million of subordinate lien revenue bonds (Subordinate Bonds, together with the Senior Bonds, the Bonds) issued by the Association. Additional sources of funds, totaling approximately $36.8 million, will include moneys received to date and during the construction period from committed revenues including the sale of luxury suites, Arena Builder Seats, Personal Seat Licenses (P S L' s), nammg rights and private fundraising/ corporate sponsorships.

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Project Site The proposed site for the Save Mart Center is approximately 48 acres. It is adj acent to the southeast comer of the main academic campus on Shaw Avenue between Woodrow Avenue and Chestnut Avenue. Shaw Avenue is a major six-lane east-west artery.

The site is also adjacent to a State Route 168 interchange. State Route 168 connects downtown Fresno to the foothills northeast of the City of Clovis.

MARKET AREAANALYSIS The feasibility of the proposed Save Mart Center depends upon many factors, including an analysis of the estimated market demand for the facility. To assess market demand, the following areas were evaluated:

• California State University, Fresno • National Collegiate Athletic Association • Local Residential Market • Transportation • Comparable Metropolitan Statistical Area (MSA) Analysis • Competitive Arena Analysis

The market analysis presented in this report and summarized below is intended to provide a basis for estimating the regional demands for activities at the proposed Save Mart Center, and to provide a foundation for assumptions used in preparing cash flowpro jections.

General market area findingsare summarized below:

• Fresno State has experienced significant growth in student enrollment since its inception. During the last two decades from 1980 to 2000, total enrollment grew at annual compounded rate of approximately 1.04 percent. • According to Fresno State, student enrollment is expected to reach nearly 21,150 students by its 2005 fall semester. Currently, the university has an enrollment of about 16,600 undergraduate students and 460 graduate students. • Fresno State supports a solid athletics program, which has been awarded with numerous titles. Historically, both the men's basketball and football programs have had excellent attendance regardless of their won-loss records. • The estimated total Fresno population was 543,664 people in the primary market (10- mile radius of proposed site), an additional 223,574 people in the secondary market (25- mile radius), and an additional 220,525 people in the tertiary market (40-mile radius), for a total population of 987, 763 people.

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• As a percentage of the total market area, the primary market accounted for 5 5.0 percent, followed by the secondary market with 22.6 percent, and the tertiary market at 22.3 percent. • The top ranking private employers include Zacky Farms (2,780), the Internal Revenue Service (2,000), Foster Farms (1,000), Aetna U.S. Healthcare (875), Pelco (800), and Upright, Inc (800). There are over 25 private employers in the Fresno area with over 200 employees. • The Fresno Metropolitan Statistical Area (MSA) ranks 64th nationally with a population of approximately 925,900. • Compared to similar MSAs, Fresno is currently below average in terms of total arena seats with 10,220 (Selland Arena). The average of the comparable MSAs is 16,057 seats. • When the 16,000 Save Mart Center seats are added to the Fresno marketplace, the Fresno MSA will rank 5th in number of seats in relation to the comparable MSA' s and rank 15th in the population per seat ratio with 35.3. • There are only two arenas with over 5,000 seats within 150-miles of the proposed Save Mart Center, Selland Arena and Centennial Gardens Arena is Bakersfield. • Compared to other markets where newer comparable arenas have recently been built, Fresno compares above average in population, number of households and average household income in the primary market areas and slightly below average in the secondary and tertiary market areas. • Compared to other markets where newer comparable arenas have recently been built, Fresno currently has only 11,300 arena seats (Selland Arena maximum capacity) compared to the average of nearly 26,600 arena seats.

COMPETITIVE AND COMPARABLE FACILITIESffENANTS We have reviewed the existing facilities within the Fresno marketplace and analyzed those which will be the most competitive. We have also analyzed comparable facilities throughout the United States, the Western Athletic Conference (WAC) as well as sports leagues as a possible second tenant.

General findings are summarized below:

• The extent of existing competitive facilities in the Fresno area is limited. We have assumed market rates on the leases at the proposed Save Mart Center on the "other events" so as to compete with Selland Arena. ERA believes that Selland Arena will not pose much of a competitive threat to the proposed Save Mart Center due to its age, size, and lack of amenities. • ERA reviewed the physical and operational characteristics of the following 21 comparable arenas which have been built in approximately the past 10 years.

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Year Seating Luxury Club Events Arena Location Built Capacity Suites $000's Seats Anchor Total

Alltel Arena (University ofArkansas -Little Rock) Little Rock, Arkansas 2000 16,500 28 $22-$50 -- 36 119 Cintas Center (Xavier University) Cincinnati, Ohio 2000 10,250 22 $40 1,000 -- -- De Soto Civic Center Southaven, Mississippi 2000 10,000 12 $35-$45 ------New Orleans Arena (Tulane University) New Orleans, Louisiana 1999 18,500 44 $26-$33 1,400 33 91 United Spirit Center (Texas Tech University) Lubbock, Texas 1999 15,000 24 $20 ------Family Arena St Charles, Missouri 1999 11,200 44 $25-$75 300 35 97 First Union Arena Wilkes-Barre, Pennsy1 vania 1999 10,500 32 $35-$38 624 34 101 Sovereign Bank Arena Trenton, New Jersey 1999 10,000 34 $40-$60 1,150 37 121 Schottenstein Center (Ohio State University) Columbus,Ohio 1998 19,500 52 $45-$65 0 -- -- Mitchell Arena (University ofAlabama) Mobile, Alabama 1998 12,800 16 $10 1,000 -- -- 1 Centennial Garden (CSUB ) Bakersfield, California 1998 10,400 27 $25-$75 1,000 46 122 Bi-Lo Center Greenville, South Carolina 1997 16,000 30 $45-$55 840 45 140 Crown Coliseum Fayetteville, North Carolina 1997 13,500 10 $35 -- 36 89 The "E" Center West Valley City,Utah 1997 13,000 40 $35-$50 540 45 140 Cox Arena (San Diego State University) San Diego, California 1997 12,400 0 -- 0 -- -- Van Andel Arena Grand Rapids, Michigan 1996 12,500 44 $25 1,800 36 173 Spokane Arena Spokane, Washington 1995 12,000 16 $25-$35 -- 47 137 World Arena Colorado Springs, Colorado 1995 9,700 -- -- 400 32 114 Mark ofthe Quad Cities Moline, Illinois 1993 12,200 15 $22-$29 -- 40 146 The Pyramid (University ofMemphis) Memphis, Tennessee 1991 20,000 26 $35-$65 ------Pepsi Arena (Sienna College) Albany, New York 1989 17,500 25 $44 75 35 179

Source: Economics Research Associates. Note: (1) California State University, Bakersfield.

• We reviewed the following minor leagues as possible second tenants at the Save Mart Center: West Coast Hockey League Continental Basketball Association National Basketball Development League Arena Football 2 National Indoor Football League World Indoor Soccer League • Although no contracts have been signed with any additional tenants as of the writing of this report, we have assumed that the Save Mart Center has the ability to, and will host at a minimum, one additional sports tenant (professional, minor league), in addition to Fresno State Athletics. • Based on conversations with the Association, we have assumed an additional anchor tenant in this analysis. If the additional anchor tenant does not play its home games in the Save Mart Center, the results of the analysis will change.

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• Based upon the market analysis, the compet1t1ve and comparable facilities/tenants analysis, the Save Mart Center has the abilityto host, at a minimum, 119 to 126 events in the first fiveyears of operation.

FINANCIAL FORECAST ERA has prepared a Base Case cash flow( detailed in Appendix A). The Base Case model utilizes assumptions developed based on our market analysis, actual pre-sales of Contractually Obligated Income (COi), discussions with the Association, Fresno business leaders, City officials, discussions with potential sports leagues, promoters, and surveys of comparable collegiate and professional arenas throughout the United States.

The terrorism attacks of September 11, 2001 in New York City and Washington DC have significantly altered the state of the United States' travel and tourism industry. At present, all sectors of the industry, ranging from airlines to hotels and ancillary services, are undergoing a severe contraction. It is unclear at this time whether this is a short-term phenomena that is likely to last for the next 12 to 18 months, or if it represents a new equilibrium or baseline from which the industry will need to recover from over the longer term.

In formulating these assumptions, ERA has looked to the past performance of comparable arenas throughout the United States. If the basic underlying structure of the industry has been altered by these events, it is likely that the results of any analysis based on past conditions will be materially different from the results eventually achieved.

General Revenue Financial Forecast Findings General findingsfor thefinancial revenue forecast are summarized below:

• The table below presents a summary of the estimated number and type of events, and estimated paid attendance per event foryear 1 (2004) of the cash flow. It should be noted that certain events are not assumed to occur each year. Events fluctuate from between 119 and 126 events in the first fiveyears of operation. • Principal sources of operating and other revenues for the proposed Save Mart Center are summarized below, reflecting the first year of operation. As shown, total net revenue forecast to be received by the arena equals approximately $10.92 million.

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Projected Save Mart Center Revenues Base Case - Year 1 - 2004 Tickets/Rent $ 672,000 Concessions and Novelties 1,527,000 Facility Use Fee 151,000 Luxury Suite Premiums 1,565,000 Arena Builder Seats and Personal Seat Licenses 40,000 Naming Rights 1,385,000 Private Fundraising/Corporate Sponsorships 1,340,000 Advertising 1,650,000 Ground Lease 750,000 Student Seating Revenues 300,000 Bulldog Foundation Subsidy 1,375,000 Sr. Lien -Debt Service Reserve Fund Earnings 155,000 Jr. Lien - Debt Service Reserve Fund Earnings 10 000 Total Revenue $10,920,000 ERA developed assumptions regarding operating expenses for the proposed Save Mart Center based on surveys of comparable arenas and ERA' s internal database. Based on the current market conditions in Fresno, and the comparable data, we have forecasted principal operating expense items as follows:

• The Association will engage a professional manager to operate the Save Mart Center. • Total operating expenses are estimated at $3.36 million in the first year of operation based on the event mix and level of utilization projected above. • Based on a full-time staff equivalent of 24 persons, total staffing costs of the manager including benefits are estimated at $1.215 million in the first year. Event-day staffing costs that would be passed through to tenants are in addition to this amount. • Utilities are projected at $639,000 in year 1. • Non-recoverable event-related expenses are projected at $100,000 in year 1. • Management feeis estimated at $400,000 in year 1. • Other expenses for administrative, insurance, professional fees, etc. are estimated at approximately $1.0 million in year 1. Table 1-1 is the summary forecast of the major line items in the Base Case cash flow forthe proposed Save Mart Center and various debt service coverage ratios (DSCR).

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Table 1-1 Presented on (000' s) Years 1st 5 years of Operation 1st Major COi Renewals 2nd Major COi Renewals CASH FLOW LINE ITEMS 2004 2005 2006 2007 2008 2012 2013 2014 2022 2023 2024

Total Event-Related Revenues $2,350 $2,434 $2,7 10 $2,534 $2,547 $2,809 $2,920 $2,958 $3,596 $3,744 $3,790 Total Contractually Obligated Income $8,405 $8,289 $8,340 $8,073 $8,092 $12,555 $12,696 $12,338 $12,929 $13,096 $13,182 Total Operating Revenues $10,755 $10,724 $11,051 $10,607 $10,639 $15,364 $15,616 $15,296 $16,525 $16,840 $16,972 Other Revenues $165 $332 $332 $332 $332 $332 $332 $332 $332 $332 $332 Total Operating Expenses $3,354 $3,455 $3,559 $3,665 $3,775 $4,249 $4,377 $4,508 $5,711 $5,882 $6,059

Revenues Available for Senior Debt Service $7,556 $7,580 $7,803 $7,252 $7,174 $11,426 $11,550 $11,098 $11,125 $11,269 $11,225 Revenues Available for Total Debt Service $7,566 $7,601 $7,824 $7,273 $7,195 $11,447 $11,571 $11,119 $11,146 $11,290 $11,246 Debt Service Coverage Ratio - (Senior Debt) 2.11 1.51 1.51 1.52 1.52 1.54 1.55 1.55 1.60 1.60 1.61 Total Debt Service Coverage Ratio 2.00 1.40 1.40 1.40 1.40 1.47 1.47 1.47 1.51 1.52 1.52 Contractually Obligated Income Coverage Ratio 2.35 1.65 1.61 1.69 1.72 1.70 1.70 1.73 1.86 1.86 1.89

Table 1-2 presents a more detailed summary of the overall cash flow model for the base case analysis. As shown, these assumptions result in revenues available for senior debt service of approximately $7.56 million in year I (2004) and reducing to $7.17 million in year 5 (2008). The key assumptions and estimated Base Case arena cash flows are presented in detail in Appendix A

Economics Research Associates California StateUn iversity, F resnoAss ociation,I nc. ERA No. 14042 Page 1- 7 Table 1-2 Cash Flow Summary SAVE MART CENTER - BASE CASE Fiscal Year 2001 2002 I 2003 I 2004 ! 2005 I 2006 ! 2007 I 2008 ! Number of Events 0 0 0 121 119 126 119 122 Annual Paid Attendance (000) 0 0 0 730 735 771 733 720

EVENT-RELATED REVENUES Tickets - (table3) Fresno State Athletic Events $0 $0 $0 $0 $0 $0 $0 $0 Other Anchor Tenant( s) 0 0 0 250 250 250 250 250 Concerts 0 0 0 211 107 224 113 237 Other Events 0 0 0 211 311 327 328 239 Total Ticket Revenue $0 $0 $0 $672 $667 $800 $691 $726 Concessions/Novelties/Parking - (table 6) Concessions $0 $0 $0 $1,508 $1,604 $1,737 $1,679 $1,646 Novelties 0 0 0 19 11 20 12 21 Parking 0 0 0 0 0 0 0 0 Total Concessions/Novelties/Parking Revenues $0 $0 $0 $1,527 $1,615 $1,758 $1,690 $1,667 Facility Use Fee - (table 2) $0 $0 $0 $151 $152 $152 $153 $153 Box Office - (table 2) 0 0 0 0 0 0 0 0 TOTAL EVENT-RELATED REVENUES $0 $0 $0 $2,350 $2,434 $2,710 $2,534 $2,547

CONTRACTUALLY OBLIGATED INCOME Luxury Suites - (table4) $855 $0 $710 $1,565 $1,565 $1,565 $1,565 $1,565 Arena Builder Seats (3 year payments) - (table 4) 6,960 4,870 4,870 0 0 0 0 0 Arena Builder Seats (10 year payments) - (table 4) 0 40 40 40 40 40 40 40 Personal Seat Licenses - (table 4) 3,489 4,542 4,542 0 0 0 0 0 Naming Rights - (table 4) 1,829 0 0 1,385 1,385 1,385 1,385 1,385 0 Private Fundraising/Corporate Sponsorships - (table 4) 3,988 3,773 1,017 1,340 1,175 1,175 855 820 p Advertising - (table 4) 0 0 0 1,650 1,700 1,750 1,803 1,857 E Ground Lease (adjacent property) - (table 4) 0 0 0 750 750 750 750 750 R Bulldog Foundation 0 0 0 1,375 1,375 1,375 1,375 1,375 A Student Seating Revenues - (table2) 0 0 0 300 300 300 300 300 T TOTAL CONTRACTUALLY OBLIGATED INCOME $17,121 $13,225 $11,179 $8,405 $8,289 $8,340 $8,073 $8,092 I N TOTAL OPERATING REVENUES $17,121 $13,225 $11,179 $10,755 $10,724 $11,051 $10,607 $10,639 G OPERATING EXPENSES Salaries and Wages - (table 5) $0 $0 $0 $1,215 $1,251 $1,289 $1,327 $1,367 s Utilities - (table 5) 0 0 0 639 658 678 698 719 u Non-Recoverable Event Related Expenses - (table 5) 0 0 0 100 103 106 109 113 M Management Fee - (table 5) 0 0 0 400 412 424 437 450 M Other - (table 5) 0 0 0 1,001 1,03 1 1,062 1,093 1,126 A TOTAL OPERATING EXPENSES $0 $0 $0 $3,354 $3,455 $3,559 $3,665 $3,775 R y NET OPERATING INCOME $17,121 $13,225 $11,179 $7,401 $7,269 $7,492 $6,941 $6,863

OTHER REVENUES Senior Lein - Debt Service Reserve Fund Earnings $0 $0 $0 $155 $3 11 $3 11 $311 $3 11 Subordinate Lein - Debt Service Reserve Fund Earnings 0 0 0 10 21 21 21 21 Transfer to Construction Fund 17,121 13,225 6,464 0 0 0 0 0 Transfer from Surplus Funds 0 0 0 0 0 0 0 0

REVENUES AVAILABLE FOR SENIOR DEBT SERVICE $0 $0 $4,715 $7,556 $7,580 $7,803 $7,252 $7, 174 REVENUES AVAILABLE FOR TOTAL DEBT SERVICE $0 $0 $4,715 $7,566 $7,601 $7,824 $7,273 $7, 195

FINANCING Senior Debt Service $0 $1,904 $4,130 $5,990 $5,033 $5,167 $4,784 $4,715 Capitalized Interest 0 (1,904) (4, 130) (2,409) 0 0 0 0 Net Senior Debt Service $0 $0 $0 $3,581 $5,033 $5,167 $4,784 $4,715

Capital Replacement Reserve $0 $0 $0 $430 $443 $456 $470 $484

Subordinate Debt Service $0 $161 $350 $4 15 $410 $411 $4 11 $4 11 Capitalized Interest 0 (161) (350) (204) 0 0 0 0 Net Subordinate Debt Service $0 $0 $0 $2 11 $410 $411 $4 11 $4 11

Return of Bulldog Foundation Subsidy $0 $0 $0 $1,375 $1,375 $1,375 $1,375 $1,375

NET ANNUAL SURPLUS $0 $0 $4,715 $1,969 $340 $415 $233 $2 11

CUMMULATIVE SURPLUS $0 $0 $4,715 $6,684 $7,024 $7,438 $7,672 $7,883

DEBT SERVICE COVERAGES Debt Service Coverage Ratio - (Senior Debt) NIA NIA NIA 2.11 1.51 1.51 1.52 1.52 Total Debt Service Coverage Ratio NIA NIA NIA 2.00 1.40 1.40 1.40 1.40 Contractually Obligated Income Coverage Ratio NIA NIA NIA 2.35 1.65 1.61 1.69 1.72 01 /16;02

Debt Service Coverage Various Debt Service Coverage Ratios were calculated:

• Revenues available for Senior Debt Service divided by Senior Debt Service; • Revenues available forTotal Debt Service divided by Total Debt Service; and • Total Contractually Obligated Income divided by Senior Debt Service.

Table 1-3 illustrates the DSCR for Senior Bonds and fortotal Bonds, as well as contractually obligated income coverage forthe Save Mart Center:

Table 1-3 Debt Service Coverage Debt Service Year A B c

2004 2.11 2.00 2.35 2005 1.51 1.40 1.65 2006 1.51 1.40 1.61 2007 1.52 1.40 1.69 2008 1.52 1.40 1.72

A - Revenues Available for Semor Debt Service I Semor Debt Service B - Revenues Available for Total Debt Service I Total Debt Service C - Contractually Obligated Income I Senior Debt Service

Sensitivities Nine sensitivities to the Base Case cash flow are located at the conclusion of Section V­ F i nanci al Forecast.

Summary Based on our knowledge of the arena/stadium industry, discussions with the Association, conversations with others throughout the sports industry, the growing university and residential population, the number of pre-leased premium products at the proposed Save Mart Center, among others, ERA believes that the Associations financial forecastto be reasonable and achievable.

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Section II

PROJECT BACKGROUND AND SCOPE OF SERVICES

PROJECT BACKGROUND California State University, Fresno Association, Inc. is in the process of preparing for the construction of the Save Mart Center, which is to be located on the campus of Fresno State.

Save Mart Center The Save Mart Center is intended to be a state-of-the-art multi-purpose event center with approximately 16,000 seats, 32-private luxury suites and 1, 108 club seats (Arena Builder Seats). It will be the home to Fresno State athletic events including the Fresno State men's and women's basketball teams and will also serve the entire San Joaquin Valley region with athletic, cultural and entertainment events.

The total costs of developing, constructing and financing the Save Mart Center are projected to total $110.6 million. The project will be financed primarily by approximately $73.8 million of Bonds (Senior and Subordinate) issued by the Association. Additional sources of funds, totaling approximately $36.8 million, will include moneys received to date and during the construction period from committed revenues including the sale of luxury suites, Arena Builder Seats, Personal Seat Licenses (PS L's), naming rights and private fundraising/corporate sponsorships.

Project Site The proposed site for the Save Mart Center is approximately 48 acres. It is adj acent to the Southeast comer of the main academic campus on Shaw Avenue between Woodrow Avenue and Chestnut Avenue. Shaw Avenue is a major six-lane east-west artery.

The site is also adjacent to a State Route 168 interchange. State Route 168 connects downtown Fresno to the foothills northeast of the City of Clovis.

SCOPE OF SERVICES ERA was retained by the Association in February 2001 to perform an analysis on the proposed Save Mart Center to be located on the campus of Fresno State. Our tasks included:

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• Market Area Analysis • Comparable and Competitive Facilities • Financial Analysis

Market Area Analysis The feasibility of the proposed Save Mart Center depends upon many factors, including an analysis of the estimated market demand for the facility. To assess market demand, the following areas were evaluated:

• California State University, Fresno • National Collegiate Athletic Association • Local Residential Market • Transportation • Comparable Metropolitan Statistical Area (MSA) Analysis • Competitive Arena Analysis

Competitive and Com parable Facilitiesffenants A review of the existing facilities within the Fresno marketplace and analyze those which will be the most competitive. We have also analyzed comparable facilities throughout the United States as well as sports leagues as a possible second tenant. The following was evaluated:

• Competitive Fresno Facilities • WesternAt hletic Conference • Potential Additional Anchor Tenants/Sports Leagues • Concert and Other Venue Event Data The Market Analysis and Competitive and Comparable Facilities/Tenants presented in this report is intended to estimate the regional need and opportunity for the proposed Save Mart Center. This analysis provides a foundation for the assumptions to be used in developing the cash flow model. The major tasks completed in conjunction with this phase included the following:

• Interviewed several of the Association's key personnel. • Conducted interviews with several business leaders in the Fresno marketplace. • Conducted interviews with and obtained information from representatives of the following local and national sports organizations: Fresno State Athletics

WesternAt hletic Conference

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- West Coast Hockey League

Continental Basketball Association

- National Development Basketball League

Arena 2 Football

- National Indoor Football League

- Maj or Indoor Soccer League

• Reviewed key market and demographic information, as well as statistical information regarding team and arena operating characteristics, provided by the following sources: Claritas, Inc.

CACI International Inc.

Comparable Arena Operating Budgets/Statements

Comparable Market Area Chamber of Commerce Publications

Association of Luxury Suite Directors

Sales & Marketing Management - "Survey of Buying Power - September, 200 l"

AudArena Stadium 2002 International Guide

- Fresno State University Athletics Statistics

2001-2002 West Coast Hockey League Media Guide

- Rand McNally Road Atlas

2001 Sports Market Place

The Sports Business Directory

The 2001-02 National Directory of College Athletics

Team Marketing Report

Amusement Business

Various Franchises

The Sports Business Daily

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Street and Smith's Sports Business Journal

Revenues from Sports Venues

Various League Data via the Internet

Financial Analysis We evaluated the financial feasibility of the proposed Save Mart Center. Based on our market analysis, survey of comparable facilities, and in-house database, we estimated the key operating variables and assumptions to be incorporated into a cash flowmodel developed specifically for this project. The cash flow model provides an estimate of the proposed Save Mart Center' s revenues available for senior and total debt service. The major tasks associated with this phase included the following:

• Identifiedcompara ble arenas located in the United States and interviewed representatives fromcompara ble arenas to obtain detailed historical operating information. • Reviewed and utilized ERA' s internal database of operating revenues and expenses for comparable arenas. • Estimated major revenue items forthe proposed Save Mart Center. • Estimated major operating costs for the proposed Save Mart Center. • Developed an operating cash flow mode 1. • Prepared nine sensitivities on the Base Case.

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Section III

MARKET AREA ANALYSIS

The market feasibility of the proposed Save Mart Center will be determined by a number of factors. In this section of the report, ERA analyzed several of these determinants, including:

• California State University, Fresno • National Collegiate Athletic Association (NCAA) • Local Residential Market • Transportation • Comparable Metropolitan Statistical Area (MSA) Analysis • Competitive Arena Analysis • Comparable Market Analysis ERA assessed the market demand forthe proposed arena at the Fresno State, which included the analyses listed ab ove. As directed by the Association, we have evaluated the market demand for the proposed Save Mart Center. The following section details the results of the market analysis.

CALIFORNIA STATE UNIVERSITY, FRESNO Founded in 1911, Fresno State is one of 23 campuses operating within the California State University system. Located at the northeast border of Fresno in the Central California San Joaquin Valley, students have easy access to the local Sierra Nevada Mountains and the California coastline. Due to the high number of accredited departmental programs it offers and the wide array of extra­ curricular alternatives made available, Fresno State has succeeded in attracting a sizeable and diverse student body.

Fresno State has experienced significant growth in student enrollment since its inception. Table III- I illustrates the historical and projected enrollment counts estimated for the University's fall term. According to the table, the total student body grew from 356 students in 1920 to 19,118 in 2000. During the last two decades from 1980 to 2000, total enrollment grew at annual compounded rate of approximately 1.04 percent. According to Fresno State, student enrollment is expected to reach nearly 21, 150 by its 2005 fall semester. Currently, the University has an enrollment of about 16,600 undergraduate students and 460 graduate students.

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Table 111-1 Fresno State Student Enrollment 1 (1 920 - 2005) Year Number of Students

Historical Estimate 1920 356 1930 1,976 1940 2, 194 1950 3,368 1960 5,907 1970 13,647 1980 15,553 1990 19,962 1991 19,824 1992 18,902 1993 18,017 1994 17,277 1995 17,460 1996 17,213 1997 18,113 1998 18,101 1999 18,325 2000 19,118 CAGR 2 (1980 - 2000) 1.04%

Projected Estimate 2001 19,610 2002 20,086 2003 20,486 2004 20,833 2005 21,148 CAGR (2001 - 2005) 1.91%

Sources: California State University, Fresno - Office of lnstitutional Research, and Economics Research Associates. Note : (1) Estimates for fall term enrollment. (2) Compounded Annual Growth Rate.

Under the Division of Student Affairs, student clubs and extra-curricular activities are promoted to encourage a dynamic student body and environment where students interact openly with one another, broaden their cultural awareness, and take advantage of leadership development opportunities. At present, the total number of student clubs and organizations is estimated to be approximately 275.

Fresno State Athletics In addition to the variety clubs and organizations offered on-campus, Fresno State also supports a strong intercollegiate athletic program, of which has been awarded with numerous titles,

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Beyond the athletes, the University's student body also participates in attending Fresno State athletic events on an on-going basis. Fan support is considerable, as Bulldog events (men's basketball) played at the existing Selland Arena typically sell out, and road game attendance is also strong. According to the university, approximately 30,000 traveled to Anaheim (CA) to partake in the Freedom Bowl, 16,000 traveled to watch the Silicon Valley Football Classic (CA), and 10,000 people were present at the Las Vegas Bowl (NV)(all football bowl games).

Table III-2 illustrates the historic attendance and won-loss records for the men's basketball and football programs at Fresno State. Attendance has been very consistent over the past decade and there does not appear to be a very large variance when the programs win or lose. Total capacity at Selland Arena and Bulldog Stadium is approximately 10,220 (basketball) and approximately 43,000 (football), respectively.

Table 111-2 Historic Athletic Attendance Basketball Football Win-Loss Average Win-Loss Average Year Record Attendance Record Attendance

1990-91 14-16 9,852 I0-2-0 34,039 1991-92 15-16 9,770 9-4-0 35,225 1992-93 13-15 8,993 8-4-0 39,536 1993-94 21-11 8,718 5-7-1 36,171 1994-95 13-15 8,244 5-7-0 33,499 1995-96 22-11 9,948 4-7-0 37,373 1996-97 20-12 10,133 6-6-0 34,262 1997-98 21-13 10,170 5-6-0 37,102 1998-99 21-12 10,198 8-5-0 37,23 1 1999-00 24-10 10,220 7-4-0 41,369 2000-01 26-6 10,220 NA NA

Sources: Association and ERA.

As the only NCAA Division-I basketball and football programs in the Central Valley, Fresno State Athletics generally receives good media coverage. According to the University, the Fresno State's men's basketball and football games make about 15 national television appearances annually, while women's basketball, volleyball, softball, and soccer regularly appears on local cable television.

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Fresno State athletic events are predominantly covered by media located along the western coast line from Los Angeles to the San Francisco Bay Area.

As described in Section IV - Corrpetitive andCorrparabl e F aci lities/fenants, Fresno State is a member of the Western Athletic Conference (WAC). Other universities include: the University of Hawaii; University of Nevada; Rice University; San Jose State University; Southern Methodist University; Texas Christian University; University of Texas, El Paso; and the University of Tulsa. Boise State University and Louisiana State University joined the conference in the 2001-2002 school year. In the most recent men's basketball season (2000-2001), the conference as a whole averaged approximately 5,986 per game, far below the average attendance at Fresno State games. Average WAC attendance for men's basketball was 6,041 (1999-2000), 7,649 (1998-99), and 7,895 (1997-98).

National Collegiate Athletic Association (NCAA) The Intercollegiate Athletic Association of the United States (IAAUS) was founded by 62 members in 1906, and took its present name, NCAA, in 1910. For several years, the NCAA was a discussion group and rules-making body; but in 1921, the first NCAA national championship was held: the National Collegiate Track and Field Championships. Gradually, more rules committees were formed and more championships were held.

The NCAA is the organization through which the nation's colleges and universities speak and act on athletics matters at the national level. It is a voluntary association of approximately 1,200 institutions, conferences, organizations and individuals devoted to the sound administration of intercollegiate athletics. Its primary purpose is the following:

• To initiate, stimulate and improve intercollegiate athletics programs for student-athletes and to promote and develop educational leadership, physical fitness, athletics excellence and athletics participation as a recreational pursuit. • To uphold the principle of institutional control of, and responsibility for, all intercollegiate sports in conformity with the constitution and bylaws of the Association. • To encourage its members to adopt eligibility rules to comply with satisfactory standards of scholarship, sportsmanship and amateurism. • To formulate, copyrightand publish rules of play governing intercollegiate athletics. • To preserve intercollegiate athletics records. • To supervise the conduct of, and to establish eligibility standards for, regional and national athletics events under the auspices of the Association. • To legislate, through bylaws or by resolutions of a Convention, upon any subj ect of general concernto the members related to the administration of intercollegiate athletics.

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• To study in general all phases of competitive intercollegiate athletics and establish standards whereby the colleges and universities of the United States can maintain their athletics programs on a high level. Through the NCAA, member colleges consider any athletics problem that crosses regional or conference lines and has become national in character. The University strives to maintain intercollegiate athletics as an integral part of the educational program and the athlete as an integral part of the student body. The NCAA also stands for good conduct in intercollegiate athletics and serves as the colleges' national athletics accrediting agency. The NCAA has grown dramatically in the past 40 years, with more than 600 new members since 1950.

In 1997, the NCAA implemented a change in its governance structure that provides greater autonomy for each division and more control by the presidents of member colleges and universities. The restructuring allows greater autonomy foreach division and more control by the chief executive officers of the member schools. Under restructuring, school and conference athletic department administrators play a primary role for the maintenance of college sports, and in most instances, for developing legislation that the presidents then consider for each division of the Association.

NCAA Enforcement/Infractions Creation of a mechanism to enforce the NCAA' s legislation, which all members pledge to observe, occurred in 1952 after careful consideration by the membership. This decision established an enforcement program designed to be a cooperative undertaking involving member institutions and conferences working together through the NCAA for an improved administration of intercollegiate athletics.

The specific mission of the NCAA enforcement staffis to act as a means of accountabilityfor member institutions by seeking out and processing information relating to possible major and secondary violations of NCAA legislation in accordance with the policies and procedures enacted by the NCAA membership.

Allegations of rules violations are referred to the Association's investigative staff A preliminary investigation is initiated to determine if an official inquiry is warranted and whether a secondary or major violation has occurred. The institution involved is notified promptly and may appear in its own behalf before the NCAA Committee on Infractions.

Findings of the Committee on Infractions and the resultant penalty in maJor cases are reported to the institution, which may appeal the findings or penalty to an appeals committee. After considering written reports and oral presentations by representatives of the Committee on Infractions and the institution, the committee acts on the appeal. Action may include accepting the infractions

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LOCAL RESIDENTIAL MARKET In order to develop an understanding of the City of Fresno's unique market environment and the potential operating characteristics of the proposed Save Mart Center, ERA analyzed the demographic and socioeconomic profile of the local market using data provided by CACI, Inc., a demographic database (CACI).

The purpose of the demographic analysis is to illustrate the local marketplace and the potential operational performance of the proposed Save Mart Center. ERA selected the following key demographic and socioeconomic attributes in order to develop an understanding of the arena's likely events demand and patron characteristics, which may be subsequently used for future marketing activities and event programming.

Population Characteristics - Marketplace population and household densities offer insight to the demand side of the events hosted at comparable venues. In general, higher population and household densities tend to support higher attendance and patron support. The proposed components of the Save Mart Center will be compared to other similar-type venues with respect to their total population and household densities.

Age Characteristics - The age characteristics of a marketplace can impact the overall appeal for spectator events, as certain age segments are more likely to attend events, such as family events, concerts, and minor league events, while other age segments tend to spend more leisure dollars during events.

Education Characteristics - Education characteristics may be indicative of the general employment environment and household income potential found in the marketplace.

Household I ncorre Potential - The household income potential of a marketplace is important to examine as it often highly affects the total attendance and revenues generated by events at comparable venues. The proposed Save Mart Center's success will depend on the market's ability to spend on leisure and entertainment activities.

Corporate Base - The corporate base of a market area generally concerns the potential demand for higher-tier services and amenities at comparable venues. Typically, facilities located in dense metropolitan areas with large corporate bases tend to cater their design, services, and event programs to meet the needs of their high-spending clientele group. For venues located in smaller market areas with lower corporate dollar potential, the venues are often catered more towards their

Economics Research Associates CaliforniaSta te University, resnoF Asscx:iation,I nc. ERA Project No. 14042 Page III-6 01 /16;02 resident markets. Located in a less dense market area, the proposed Save Mart Center will be primarily positioned forthe families and small- to mid-sized businesses of Fresno, California.

Ring Analysis In this demographic analysis, the three market areas used forthe study are definedby 10-, 25- and 40-mile market rings drawn from the main campus at Fresno State in Fresno, California. A description of the three market areas is as follows:

• Primary market: the market area definedby a I 0-mile radius from the proposed site. Due to its close proximity to the proposed site, the primary market is expected to be highly penetrated. • Secondary market: the market area defined by a 25-mile radius from the proposed site less the primary market area. Also relatively close in proximity to the proposed site, this market area represents considerable patron potential. • Tertiary market: the market area defined by a 40-mile radius from the proposed site less the primary and secondary market areas. Market penetration of the tertiary market area is expected to decline due to increasing inconveniences in relation to site accessibility and time constraints. • Total market: the aggregate market area defined by a 40-mile radius from the proposed site. Market penetration of the total market area is expected to be highest in the primary market area, gradually declining in the secondary and tertiary markets respectively. As mentioned above, the arena will draw most of its spectators from the local area, in particular, from the primary and secondary markets. Attendees will also be drawn from the tertiary market area, although past observations of attendance statistics for similar arenas have shown market penetration declines past roughly a 25-mile radius from the arena, especially for weekday scheduled events and forsports.

In the following sections, ERA analyzed the population, age, educational attainment, employment, and household income trends that are characteristic of the defined markets. With regards to the population-, age-, education-, race-, and income- tables presented, ERA displayed the counts and percentage distribution forthe primary, secondary, and tertiary markets and the total (0-40 mile) market area as a whole.

ERA also indexed each of the three individual market areas as measured against the value of the total market area. This allows for acomparison of the three market areas relative to the conditions found in a broader market context. Provided in the second column of the tables, the market variables are represented as cross-tabulated figures that analyzes individual market area percentage distributions relative to the total market area percentage distribution. Thus, with the total market area valued at 1.00, characteristics similarly valued at 1.00 suggest that the characteristics are represented

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For example, in Table III-4, the primary market area share of residents between the ages of 25 and 34 years old indicates an index value of 1.03. This value suggests that the primary market area has a slightly higher concentration of residents between the ages of 25 and 34 years old in comparison to the total market area as a whole.

Total Population According to the Fresno City and County Conventions Visitors Bureau, the current total county population is approximately 879,800. Table III-3, General Population and Household Characteristics, shows the population statistics found forthe primary, secondary, and tertiary markets respectively. The 1999 estimated total population was 543,664 people in the primary market, an additional 223,574 people in the secondary market, and an additional 220,525 people in the tertiary market. Summing these three market areas, the total market contained approximately 987,800 people. As a percentage of the total market area, the primary market accounted for 55.0 percent, followed by the secondary market with 22.6 percent, and the tertiary market at 22.3 percent.

According to CACI, Inc., the tertiary market, at 1.1 percent, will experience a slightly stronger annual growth rate from 1999 to 2004 than the primary and secondary markets. The primary market is expected to grow by 0.8 percent annually for the same period, while the secondary market should grow by 1.0 percent. Anticipated to grow at an annual rate of 0.9 percent, the total market area is projected to contain about 1,032,050 people by 2004.

In the same table, the projected number of households residing within the defined market areas show percentage distributions and growth patterns similar to the population. By 2004, the total market area is estimated to contain approximately 334,590 households.

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Table 111-3 General Population and Household Characteristics, 1999 and 2004 Market Area Counts Mkt. Area as a % of Total Mkt. 0-10 10 - 25 25 - 40 Total Mkt 0-10 10- 25 25 - 40 Miles Miles Miles Are2 Miles Miles Miles

Total Population 1999 543,664 223,574 220,525 987,763 55.0% 22.6o/c 22.3% 2004 565,037 234,449 232,564 1,032,050 54.7% 22. 7o/c 22.5% CAGR * 0.8% 1.0o/c 1.1% 0.9o/c Total Households 1999 188,118 67,07E 64,484 319,678 58.8% 21.0o/c 20.2% 2004 195,713 70,47( 68,407 334,590 58.5% 21.1o/c 20.4% CAGR * 0.8% 1.0o/c 1.2% 0.9o/c Avg. Household Size 1999 2.8 3.3 3.2 3.C ------2004 2.8 3.3 3.2 3.C ------

Source : CACI, Inc. and ERA. Note : *Compounded Annual Growth Rate.

Age Stratification The age distribution of a population can impact the drawing power for spectator events. In general, the 18 to 34 age group is widely regarded in the spectator events industry as a group that is more likely to attend events such as concerts and minor league sports, in addition to exhibiting higher spending patterns than older age groups. The 35 to 49 age group is also important in that children often accompany their parents at games. A high concentration of the O to 17 age group can similarly translate into more family-oriented events that require parent/chaperone attendance.

Prior to analyzing the age distribution patterns of the defined market areas, ERA conducted a brief overview analysis of the total market area' s age distribution in comparison to the United States. This overview will bring the subsequent three-market age analysis into better context, as it will provide the (national) norms fromwhich to draw the local trend implications. Exhibit III-A illustrates and compares the age distribution of the proposed Save Mart Center's total market area and the U.S.

According to Exhibit III-A, the total market area averages slightly younger than the nation as a whole in 1999. Fresno's age segments representing residents younger than 24 years old in age exhibited percentages that were higher than the U.S. norms. As shown, the nation trailed behind the total market area in the O to 17 age group and the 18 to 24 age group, while it showed the same percentage in the 25 to 34 age group at 13.9 percent. The greatest disparity was found in the 50+ age group, as the nation's share exceeded the City by 5.1 percent. Table III-4, describes the age distribution patterns found in the primary, secondary, and tertiary markets.

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Exhibit III-A Comparison of Age Distrib ution in the Total Market Area and U.S., 1999

35.0'/o

30.0'/o

25.0'/o

20.0'/o

15.0'/o

10.0'/o

5.0%

0.0% 0-17 18-24 25 -34 35 -49 50+ Years

! m Tota l Market Area 1111Un ited States ! Source: CACI, Inc. and ERA.

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Table 111-4 Population by Age, 1999 Market Area Counts Mkt. Area as a% of Total Mkt. Area 0-10 10 - 25 25 - 40 Total 0-10 10- 25 25 - 40 Miles Miles Miles Area Miles Miles Miles

Median Age 30.6 30.2 29.8 30.4 ------

Age 0 - 17 175,630 75,353 75,096 326,079 53.9% 23 .1% 23.0% 18 - 24 54,169 22,604 21,686 98,459 55.0% 23 .0% 22.0% 25 - 34 78,058 27,834 31,859 137,751 56.7% 20.2% 23.1% 35 - 49 116,397 45,533 44,243 206,173 56.5% 22.1% 21.5% 50+ 119,474 52,242 47,634 219,350 54.5% 23 .8% 21.7%

Age - percent 1 Index 2 0 - 17 32.3% 33.7% 34.1% 33.0% 0.98 1.02 1.03 18 - 24 10.0% 10.1% 9.8% 10.0% 1.00 1.01 0.99 25 - 34 14.4% 12.5% 14.4% 13.9% 1.03 0.89 1.04 35 - 49 21.4% 20.4% 20. 1% 20.9% 1.03 0.98 0.96 50+ 22.0% 23.4% 21.6% 22.2% 0.99 1.05 0.97

Sources: CACI, Inc. and ERA. Note: (1) As a percentageof Market Area. (2) The index measures selected characteristics for each designated market area as measured against the total market area as a whole. The total market area is indexed at 1.00. Market areas with scores below 1.00 illustrates an under-representation of the selected characteristic, while markets areas with scores greater than 1.00 shows an over-representation of the characteristic in comparison to the total market area.

The cross-tabulated index shown in the second column of the table show that the three market areas generally have a well-distributed population by age. Aside from the slight under-representation of the 25 to 34 year old bracket in the secondary market (0.89), all other age brackets are evenly distributed in the three market areas in relation to the total market area. In general, Fresno contains a healthy concentration of people belonging to the identified age groups that characteristically attend arena-type events. This is a positive indication forthe proposed arena.

These age skews are also supported by the median age figures shown in the table. The 1999 median age was 30.6 years in the primary market, 30.2 years in the secondary market and 29.8 years in the tertiary market. The weighted median age calculated for the total market area was 30.4 years. In comparison to the U. S. median age of 35.9, Fresno is considerably younger in age composition.

Education Residents of the Fresno MSA are relatively well educated. According to the Fresno Economic Development Corporation, approximately 50.0 percent of the total (25 years and older) population completed at least some college work and/or associate degree or higher, while 71.7

Economics Research Associates CaliforniaSta te University, resnoF Asscx:iation,I nc. ERA Project No. 14042 Page III-11 01 /16;02 percent of the total population graduated high school. However, relative to the U.S. distribution, Fresno has a higher percentage of non high school graduates (28.3 percent) compared to the nation (15.9 percent). The United States as a whole shows a higher portion of "High School Graduates" and people with "Some College/Associa te Degree" education, yet it lags slightly behind Fresno in the Bachelor's Degree or Higher" category. Table III-5 shows the breakdown of educational attainment found in the Fresno MSA and United States.

Table 111-5 Fresno MSA Education Distrib ution, 1999 Fresno us

Non High School Graduate 28.3% 15.9% High School Graduate 21.7% 33.1% Some College/Assoc iate Degree 22. 1% 25.4% Bachelor's Degree or higher 27.9% 25.6%

TOTAL I00.0% I00.0%

Sources: Fresno Economic Development Corporation. U.S. Census Bureau, and ERA.

Race and Ethnicity The ethnic composition of the market can be a consideration in the programmmg and marketing of other entertainment events. According to Table III-6, Fresno is predominantly White (non-Hispanic origin) and Hispanic in composition, as each segment consists of 40.6 percent and 30.5 percent, respectively, of the total market population in 1999. With a combined share of 28.9 percent, the other racial segments represent a very small portion of the total market' s population.

The cross-tabulated figures displayed in the second column, indicate the relative density of each racial group for the three market areas. In general, the African American and Asian/Pacific Islander racial groups are over represented in the primary market area in the city'score, while the two groups are under-represented in the secondary and tertiary market area. The Hispanic segment and "Other" racial segment show a slight under-representation in the primary market, while they are more densely populated in the secondary and tertiary market areas. The remaining White and Native American Indian racial groups are generally evenly distributed among the three market areas.

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Table 111-6 Population by Race, 1999 Market Area Counts Mid. Area as a 0/o of Total Mid. Area 0-10 10 - 25 25 - 40 Total 0-10 10- 25 25 - 40 Miles Miles Miles Area Miles Miles Miles

Race and Ethnicity (%) 1 Index 2 White 42.7% 36.1% 40.8% 40.6% 1.05 0.89 1.01 African American 4.7% 1.0% 2.1% 3.2% 1.48 0.32 0.67 Native American Indian 0.7% 0.6% 0.7% 0.7% 1.04 0.87 1.05 Asian/Pacific Islander 9.4% 2.5% 3.1% 6.2% 1.51 0.40 0.50 Other 16.4% 22. 1% 20.9% 18.8% 0.87 1.17 1.11 Hispanic 26. 1% 37.7% 32.3% 30.5% 0.86 1.24 1.06

Sources: CACI, Inc. and ERA. Note: (1) As a percentageof Market Area. (2) The index measures selected characteristics for each designated market area as measured against the total market area as a whole. The total market area is indexed at 1.00. Market areas with scores below 1.00 illustrates an under-representation of the selected characteristic, while markets areas with scores greater than 1.00 shows an over-representation of the characteristic in comparison to the total market area.

Income and Employment Characteristics Since the proposed Save Mart Center' s success will depend in part on the targeted markets' ability to spend on leisure and entertainment activities, it is important to consider the income level and employment base of the local residential market. In the following section, ERA describes and analyzes the local income levels, employment trends, and major employers found within the City of Fresno.

Income Characteristics Similar to the AgeStra tification section, a brief overview of the total market area' s income distribution in comparison to the United States is provided to give context to the following analysis conducted on the arena' s primary, secondary, and tertiary markets. Exhibit III-B shows the total market area' s income distribution relative to the nation in 1999.

Exhibit III-B suggests that the arena's total market area is slightly less affluentthan the nation as a whole. For the two income-brackets earning annual household incomes of $29,999-and-less, the total market area showed higher percentage values than those representing the U.S., while for the top three income-brackets earning more than $50,000 annually, the total market area lagged behind. In 1999, the total market area exhibited the following deviations from the nation: the $19,999-and-less income bracket (+5.4 percent); the $20,000 to $29,999 income bracket (+2.0 percent); the $30,000 to $49,999 income bracket (+0.1 percent); the $50,000 to $74,999 income bracket (-3 .1 percent); the

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$75,000 to $99,999 income bracket (-2.2 percent); and the $100,000-and-more income bracket (-2.3 percent).

Exhibit 111-B Comparison of Income Distrib ution in the Total Market Area and U.S., 1999

30.CY'/o

25.CY'/o

20.CY'/o

15.CY'/o

10.CY'/o

5.0%

0.0% <$19,999 $20,000 - $29,999 $30,000 - $49,999 $50,000- $74,999 $75,000 - $99,999 $100,000+

! llilTotal Market Area IllUn ited States ! Sources: CACI, Inc an ERA.

Table III-7 provides the income characteristics found for the primary, secondary, and tertiary markets. According to the Table III-7, the primary market is more affluent in terms of annual household income when compared to the other two markets defined. In 1999, the median household income was estimated to be approximately $37,430 in the primary market, $33,909 in the secondary market, and $33,328 in the tertiary market. The weighted median household income of the total market area was calculated to be $35,864 for the same year.

It is also significant to compare the median household income to the average household income, as the magnitude of a positive or negative differential between the two values may imply skews in the income distribution pattern. A significantly larger average income compared to the median indicates a strong positive skew in the income distribution, signifying that there is a higher proportion of well-off households earning significantly higher incomes than the typical households.

The table suggests that there is a nominal proportion of moderate to wealthy households ($50,000-and-more) found in the defined market areas, as the average incomes of the three market

Economics Research Associates CaliforniaSta te University, resnoF Asscx:iation,I nc. ERA Project No. 14042 Page III-14 01 /16;02 areas are all greater in value than their respective median incomes by a ratio of 1.3 to one, which is a typical ratio. For the total market area, the average household income was $47,318 in 1999.

Table 111-7 Income Characteristics, 1999 and 2004 Market Area Counts Mid. Area as a 0/o of Total Mid. Area 0-10 10- 25 25 - 40 Total 0-10 10- 25 25 - 40 Miles Miles Miles Area Miles Miles Miles

Median Household Income Index 2 1999 $37,430 $33,909 $33,328 $35,864 1.04 0.95 0.93 2004 $45,196 $41,463 $42,113 $43,779 1.03 0.95 0.96 Average Household Income 1999 $49,942 $44,132 $42,975 $47,318 1.06 0.93 0.91 2004 $63,368 $56,458 $56,349 $60,478 1.05 0.93 0.93

Ho useholds by Income, 1999 < $19,999 51,213 19,428 18,032 88,673 57.8% 21.9% 20.3% $20,000 - $29,999 29,001 10,868 11,250 51,119 56.7% 21.3% 22.0% $30,000 - $49,999 47,839 17,740 17,973 83,552 57.3% 21.2% 21.5% $50,000 - $74,999 31,712 10,565 10,078 52,355 60.6% 20.2% 19.2% $75,000 - $99,999 13,347 4,387 3,718 21,452 62.2% 20.5% 17.3% $100,000+ 14,992 4,081 3,433 22,506 66.6% 18.1% 15.3%

Ho useholds by Income, 1999-(%) 1 Index 2 < $19,999 27.2% 29.0% 28.0% 27.7% 0.98 1.04 1.01 $20,000 - $29,999 15.4% 16.2% 17.4% 16.0% 0.96 1.01 1.09 $30,000 - $49,999 25.4% 26.5% 27.9% 26.1% 0.97 1.01 1.07 $50,000 - $74,999 16.9% 15.8% 15.6% 16.4% 1.03 0.96 0.95 $75,000 - $99,999 7. 1% 6.5% 5.8% 6.7% 1.06 0.97 0.86 $100,000+ 8.0% 6.1% 5.3% 7.0% 1.13 0.86 0.76

Sources: CACI, Inc. and ERA. Note: (1) As a percentageof Market Area. (2) The index measures selected characteristics for each designated market area as measured against the total market area as a whole. The total market area is indexed at 1.00. Market areas with scores below 1.00 illustrates an under-representation of the selected characteristic, while markets areas with scores greater than 1.00 shows an over-representation of the characteristic in comparison to the total market area.

This income concentration trend is further quantified and presented in the table. Accordingly, the primary market area had the highest density of households earning $50,000-and-more annually in 1999, followed by the secondary market and the tertiary market. This observation is suggested by the cross-tabulated index derived using the total market area.

Relative to the total market area, the primary market contained 60.6 percent in the $50,000 to $74,999 income bracket, 62.2 percent in the $75,000 to $99,999 income bracket, and 66.6 percent in the $100,000-and-more income bracket. The secondary market generated the next highest-ranking

Economics Research Associates CaliforniaSta te University, resnoF Asscx:iation,I nc. ERA Project No. 14042 Page III-15 01 /16;02 percentages in the total market area, by displaying 20.2 percent, 20.5 percent, and 18.1 percent for each of the $50,000-and-more income brackets respectively.

The tertiary market is the least affluent of the sub areas within the O to 40-mile radius. This more distinct market has the lowest percentage of households earning $50,000-and-more annually.

Employment Base In the Fresno MSA, agriculture is the pnmary industry. Other industries with sizeable employment concentrations include services, manufacturing, retail sales, and wholesale trade. Table III-8 presents the employment distributions foundin the Fresno MSA as of January 2001.

• The agricultural, services, and government industries employ the highest number of people in Fresno MSA, accounting forapproximately 21.4 percent, 20.5 percent, and 19.5 percent of the total employment base in January 2001 respectively. • The mining industry employs the lowest number of people in the county, representing approximately O .1 percent of the total employment base in January 2001. • As of January 2001, with a total civilian workforce of approximately 461,300 people, Fresno County has a relatively high unemployment rate at 14.9 percent, reflective of its agricultural based economy. Table 111-8 Fresno MSA Employment Base Industry OOO's % of Total

Agriculture 80.9 21.4% Mining 0.3 0. 1% Construction 16.8 4.5% Manufacturing 29.6 7.8% Transportation & Utilities 13.8 3.7% Wholesale Trade 14.9 4.0% Retail Sales 55.4 14.7% Finance, Insurance & Real Estate 14.5 3.8% Services 77.5 20.5% Government 73.5 19.5%

Total 377.2 100.0%

Total Civilian Workforce 461.3

Unemployment Rate (%) 14.9%

Sources: Fresno Economic Development Corporation, and Economics Research Associates. Note: Labor force data is by place of residence and includes self-employed individuals, unpaid family workers, household domestic workers, and workers on strike. January 2001.

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• The table below illustrates the historical annual average employment statistics in Fresno County. Since 1990, the unemployment rate has averaged nearly 14 percent, reflective of its agricultural based economy. Historical Annual Average Employment Statistics Fresno County (1 990 - 2000) Unemployment Year Rate

1990 11.7% 1991 13.4% 1992 15.7% 1993 15.4% 1994 13.8% 1995 14.1% 1996 13.1% 1997 13.4% 1998 14.2% 1999 13.4% 2000 14.3%

Average 13.9%

Sources: California Employment Development Department, and ERA.

Large Businesses The number of businesses in a market area provides an indication of the potential demand for luxury suites and club seats and potential advertising and sponsors at the proposed Save Mart Center. In particular, the corporate base of the market area is important for projecting the proposed arena' s potential demand forhigher-ti er services and amenities.

Provided by the Fresno Economic Development Corporation, Table III-9 lists the Fresno MSA' s major employers and their approximate total number of employees. The top ranking private employers include Zacky Farms (2,780), the Internal Revenue Service (2,000), Foster Farms (1,000), Aetna U. S. Healthcare (875), Pelco (800), and Upright, Inc (800). There are over 25 private employers with over 200 employees. These employers (Table III-9) represent a potential future target market for luxury suite and Arena Builder Seat leases, advertising, corporate sponsorships, etc. As stated in Section V - FinancialAnalysi s of this report, a majority of the inventory of premium seating and sponsorships has been leased.

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Table 111-9 Major Employers in Fresno MSA Company Number of Employees Type of Business

Zacky Farms 2,780 Food Processor Internal Revenue Service 2,000 Government Foster Farms 1,000 Food Processor Aetna U.S. Healthcare 875 Back Office Pelco 800 Manufacturer UpRight, Inc. 800 Manufacturer Vendo Company 780 Manufacturer Sunrise Medical 550 Manufacturer Quinn Company 497 Manufacturer Mission Foods 400 Food Processor Grundfos Pumps Co. 400 Manufacturer Britz Fertilizer, Inc. 400 Manufacturer Duncan Enterprises 400 Manufacturer Pepsi Cola Company 380 Distribution The Gap 350 Distribution Guardian Industries 310 Manufacturer Nisshinbo California, Inc. 300 Manufacturer Chamlian Enterprise 280 Distribution PPG Industries 260 Manufacturer Fresno Valves & Castings 250 Manufacturer Salwasser Manufacturing Co. 250 Manufacturer Kraft Food 240 Distribution Floway Pumps 236 Manufacturer Shane Distribution Systems 200 Distribution CMB Industries, Inc. 200 Manufacturer

Sources: Fresno Economic Development Corporation, Dun & Bradstreet, and ERA.

TRANSPORTATION Located in the central San Joaquin Valley, Fresno is situated near three national parks, including Yosemite National Park, Sequoia National Park, and Kings Canyon National Park. To the west is flat agricultural lands, while the east is dominated by the Sierra Nevada Mountains. For vehicular travel, State 99 connects to Interstate 5 and State 58, which provides Fresno access to other major California cities, such as Los Angeles, San Francisco, and Sacramento. Fresno is easily accessible by other modes of transportation as well, as Amtrak, Greyhound Bus Lines, and various national/regional airlines schedule Fresno as a major destination stop.

Highway Transportation The City of Fresno is located offof State 99 in the central San Joaquin Valley. In general, major interstates and highways connecting to Fresno are listed below:

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• 1-5 - North and South along the State of California with major destination links to San Diego, Los Angeles, San Francisco, and Sacramento. • CA 99 - North and South highway connecting the cities of Bakersfield, Tulare, Visalia, Fresno, and Merced. • CA 58 - East and West highway with connection to 1-15 (via Las Vegas, Nevada) and 1- 40 (via Kingman, Nevada). CA 58 also passes through the cities of Barstow and Bakersfield. Fresno is within a short driving distance away from many major cities in California and Nevada. The approximate driving distance to selected cities are listed below:

• Bakersfield (CA) - 107 miles • San Luis Obispo (CA) - 127 miles • Stockton (CA) - 130 miles • San Jose (CA) - 151 miles • Monterey (CA) - 158 miles • Sacramento (CA) - 164 miles • Oakland (CA) - 176 miles • San Francisco (CA) - 182 miles • Los Angeles (CA) - 215 miles • Ventura (CA) - 227 miles • Barstow (CA) - 243 miles • Santa Barbara (CA) - 251 miles • Reno (NV) - 299 miles • Palm Springs (CA) - 328 miles • San Diego (CA) - 339 miles • Las Vegas (NV) - 394 miles

Air Transportation

Fresno Yosemite International Airport is the primary commercial airport for Fresno and the surrounding areas. Located approximately 10 miles northeast of downtown Fresno, it is easily accessible by the City'sma jor traffic thoroughfares. In 2000, over 1.0 million passengers traveled to and from theFresno Yosemite International Airport.

Five major and five regional carriers service the airport. The major airlines include American Airlines, Continental Airlines, Delta Airlines, Northwest Airlines, and United Airlines. The regional airlines include Allegiant Air, American West/Mesa Airlines, Hawaii Airlines, Horizon Airlines, and Skywest Airlines. The airlines service more than 100 scheduled flights daily to most major regional

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Rail Transportation Amtrak is the main line that provides most of the rail transportation to Fresno. The City of Fresno is a local stop for Amtrak's San Joaquin Valley service route, which travels 5 to 6 times daily up and down thecentral valley corridor.

Bus Transportation Greyhound Lines, Inc., the largest U.S. bus company, is the primary provider of intercity bus service to and from Fresno. With more than 2,600 destinations, Greyhound operates approximately 17 scheduled daily arrivals and departures out of the Fresno Station.

COMPARABLE METROPOLITAN STATISTICAL AREA (MSA) ANALYSIS For analytical purposes, ERA compared the Fresno Metropolitan Statistical Area (MSA) relative to other MSAs that share similar market sizes across the United States. The statistics presented below are used for illustrative purposes and provide a consistent comparison methodology for the selected market areas. Furthermore, ERA compiled an inventory list of arenas and indoor event centers with a minimum of 5,000 seats for each MSA market in order to calculate their respective population per seat ratio. This comparative analysis will lend a better understanding of Fresno's unique market environment relative to similar market areas in the nation.

• Table III-IO shows the 54th to 74th ranked MSAs in the United States, detailing each market' s total population, households, and Effective Buying Income (EBI). ERA noted the following trends: The Fresno MSA has a population of over 925,900. The Memphis (TN) MSA is the largest with a population greater than 1,113,000. The average population forthe 54th to 74th ranked MSAs is 933,000. • The Fresno MSA has approximately 299,200 households, ranking 181h among the comparable MSAs surveyed. The West Palm Beach - Boca Raton (FL) MSA has the largest number of households at over 447,600. The average number of households for the 54th to 74th ranked MSAs is approximately 352,600. • The Effective Buying Income (EBI) presented in the table is defined as personal income less personal tax and non-tax payments. The Fresno MSA has over $11.1 billion in total EBI, ranking last among the 21 selected MSAs. The Bridgeport-Stamford-Norwalk­ Danbury (CT) MSA has the largest total EBI at approximately $29.6 billion. The average total EBI for the 54th to 74th ranked MSAs is approximately $17.4 billion.

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Table 111-10 54th and 74th ranked Metropolitan Statistical Areas (MSA) U.S. Population Households Total EBI 1 Rank MSA (OOO's) Rank (OOO's) Rank (OOO's) Rank

54 Memphis (TN) 1,113.0 1 414.1 2 $19,43 1,011 4 55 Jacksonville (FL) 1,081.4 2 412.1 3 $19,628,250 3 56 Rochester (NY) 1,078.8 3 407.5 4 $18,334,890 9 57 Grand Rapids-Muskegon-Holland (MI) 1,060.5 4 384.1 7 $19,094,036 5 58 West Palm Beach-Boca Raton (FL) 1,057.1 5 447.6 1 $26,396,713 2 59 Oklahoma City (OK) 1,053.3 6 405.2 5 $16,520,526 12 60 Louisville (KY) 1,012.1 7 400.0 6 $18,340,971 8 61 Richmond-Petersburg (VA) 976.5 8 382.3 8 $18,459,571 7 62 Dayton-Springfield (OH) 959.9 9 374.3 9 $17,664,154 10 63 Greenville-Spartanburg-Anderson (SC) 936.0 10 357.6 11 $14,410,822 16 64 Fresno (CA) 925.9 11 299.2 18 $11,152,602 21 65 Birmingham (AL) 920.2 12 360.9 10 $18,579,413 6 66 Providence-Warwick-Pawtucket (RI) 910.0 13 345.3 12 $16,148,964 14 67 Albany-Schenectady-Troy (NY) 870.5 14 338.3 14 $15,243,990 15 68 Honolulu (HI) 860.3 15 285.5 19 $16,168,772 13 69 Tucson (AZ) 855.3 16 340.5 13 $ 12,888, 105 20 70 Bridgeport-Stamford-Norwalk-Danbury (CT) 845.2 17 314.2 15 $29,554,466 1 71 New Haven-Waterbury Meriden (CT) 795.3 18 304.5 17 $16,984,930 11 72 Tulsa (OK) 791.0 19 311.8 16 $13,403,994 19 73 Ventura (CA) 749.4 20 240.2 21 $13,891,170 17 74 Worchester-Fitchburg-Leominster (MA) 74 1.9 21 278.7 20 $13,74 1,083 18

Average 933.0 352.6 $17,430,402

Sources: Sales & Marketing Management - 2000 Survey of Buying Power, and ERA. Note: (1) Effective Buying Income.

• To put the EBI in the Fresno MSA into perspective it ranks just below the following national MSAs: Knoxville, Tennessee Sarasota - Bradenton, Florida Ann Arbor, Michigan Albuquerque, New Mexico And above the following MSAs: Syracuse, New York Toledo, Ohio Springfield, Missouri Little Rock - North LittleRock, Arkansas

Cost of Living The relative price level within a market area may impact a variety of factors, including: wages and salaries; consumer pricing; operating costs; and other personal and business income and

Economics Research Associates CaliforniaSta te University, resnoF Asscx:iation, I nc. ERA Project No. 14042 Page III-21 01 /16;02 expense items. ERA evaluated the price level of comparable market areas by analyzing the Cost of Living (COL) index forthe MSA's that are comparable to the Fresno MSA. The COL index provides a standardized measure of many living cost variables, including: home prices; utility expenses; state and local taxes; food; tuition; health care; and, transportation among other common expenses. These items are indexed against a national average of 100.

The City of Fresno COL is approximately 103.4. Table III-11 provides a companson summary of the City of Fresno COL with the COLs of the 54th to 74th ranked MSA cities.

• The City of Fresno's COL index ranks Sh out of the 21 comparable MSAs. Honolulu (HI) has the highest COL index among the comparable MSAs at 168.0, while the Oklahoma City (OK) MSA has the lowest COL index among the comparable MSAs at 85.1. • The average COL index among the comparable MSAs is 104.2. The City ofFresno has a relatively high COL index, which indicates that price levels forvari ous aspects of the arena's operations (i.e. utilities) may be higher than those demonstrated by the majority of other comparable MSA illustrated in Table III-11.

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Table 111-11 Cost of Living Index Summary 54th and 74th ranked Metropolitan Statistical Areas (MSA) Population Cost of Living Major MSA/City (OOO's) Rank Index 1 Rank

National Average 100.0

Honolulu (HI) 860.3 15 168.0 1 Ventura (CA) 749.4 20 144.5 2 New Haven-Waterbury-Meriden (CT) 795.3 18 108.7 3 Worchester-Fitchburg-Leominster (MA) 74 1.9 21 108.4 4 Bridgeport-Stamford-Norwalk-Danbury (CT) 845.2 17 107.2 5 Richmond-Petersburg (VA) 976.5 8 104.8 6 Tucson (AZ) 855.3 16 104.7 7 Fresno (CA) 925.9 11 103.4 8 Albany-Schenectady-Troy (NY) 870.5 14 101.3 9 Birmingham (AL) 920.2 12 100.1 10 West Palm Beach-Boca Raton (FL) 1,057.1 5 99.9 11 Providence-Warwick-Pawtucket (RI) 910.0 13 97.9 12 Louisville (KY) 1,012. 1 7 96.7 13 Greenville-Spartanburg-Anderson (SC) 936.0 10 96.7 13 Grand Rapids-Muskegon-Holland (MI) 1,060.5 4 96.1 14 Dayton-Springfield (OH) 959.9 9 95.1 15 Rochester (NY) 1,078.8 3 94.5 16 Jacksonville (FL) 1,081.4 2 93.5 17 Tulsa (OK) 79 1.0 19 93.4 18 Memphis (TN) 1,113.0 1 88.6 19 Oklahoma City(OK) 1,053.3 6 85.1 20

Average 933.0 104.2

Sources: Fast Forward Inc., and ERA. Note: (1) Cost of Living Index incorporates the cost of housing, food/groceries, transportation, utilities, etc. relative to each defined location.

Seating Inventory Table III-12 illustrates a summary of the total seating inventory and population per seat ratio found in the 54th to 74th MSA markets. It should be noted that ERA did not include venues with seating capacities of less than 5,000 seats in the total inventory count. It should also be noted that this list is intended to include all venues (municipal, collegial, and private), but may not be inclusive.

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Table 111-12 Summary of the Total Seat Inventory for the 54th and 74th ranked Markets Population To tal Seating Population Per Seat MSA (OOO's) Rank Seats Rank Persons Rank

Memphis (TN) 1,113.0 1 36,100 1 30.8 18 Jacksonville (FL) 1,081.4 2 10,276 15 105.2 4 Rochester (NY) 1,078.8 3 14,000 12 77. 1 8 Grand Rapids-Muskegon-Holland (MI) 1,060.5 4 25,900 5 40.9 16 West Palm Beach-Boca Raton (FL) 1,057.1 5 6,300 19 167.8 2 Oklahoma City (OK) 1,053.3 6 12,000 14 87.8 7 Louisville (KY) 1,012.1 7 7,000 18 144.6 3 Richmond-Petersburg (VA) 976.5 8 29,724 3 32.9 17 Dayton-Springfield (OH) 959.9 9 21,300 6 45.1 15 Greenville-Spartanburg-Anderson (SC) 93 6.0 10 16,000 8 58.5 11 Fresno (CA) 925.9 11 10,220 16 90.6 6 Birmingham (AL) 920.2 12 14,500 11 63.5 9 Providence-Warwick-Pawtucket (RI) 910.0 13 14,572 10 62.4 10 Albany-Schenectady-Troy (NY) 870.5 14 17,500 7 49.7 13 Honolulu (HI) 860.3 15 8,733 17 98.5 5 Tucson (AZ) 855.3 16 35,550 2 24.1 20 Bridgeport-Stamford-Norwalk-Danbury 845.2 17 0 20 NIA 1 New Haven-Waterbury-Meriden (CT) 795.3 18 0 20 NIA 1 Tulsa (OK) 79 1.0 19 29,021 4 27.3 19 Ventura (CA) 749.4 20 13,500 13 55.5 12 Worchester-Fitchburg-Leominster (MA) 74 1.9 21 15,000 9 49.5 14

Average 933.0 16,057 69.0

Sources: Sales & Marketing Management - 2001 Survey of Buying Power, AudArena Stadium 2001 International Guide, and ERA.

The existing Selland Arena is located in the heart of Downtown Fresno. The arena is situated within the Fresno Convention Center complex, along with the William Saroyan Theater. According to the current arena management and industry sources, the arena has a total seating capacity of approximately 10,220 seats. The Fresno MSA currently has a total of 10,220 seats, ranking 16th among the comparable MSAs. In relation to its population, the Fresno MSA has a population per seat ratio of nearly 90.6. Excluding the Bridgeport-Stamford-Norwalk-Danbury (CT) and the New Haven-Waterbury-Meriden (CT) MSAs, both of which have no seating inventories at the present time, the highest-ranking MSA is West Palm Beach-Boca Raton (FL) with a high population per seat ratio of nearly 167.8. The average total seating inventory for the 21 selected MSAs is over 16,000, and the average population per seat ratio is approximately 69.0. When the 16,000 Save Mart Center seats are added to the Fresno marketplace, the Fresno MSA will rank 5th in number of seats, and rank 15th in the population per seat ratio with 35.3.

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COMPETITIVE ARENA ANALYSIS The demand for sports and entertainment in the Fresno MSA is served by one existing arena, the Selland Arena at the Fresno Convention Center. To evaluate the market for the proposed arena, ERA evaluated the Selland Arena in terms of fundamental facility and operating characteristics, including: seating capacity; seating configuration; support areas; number of events and other significant factors.

Selland Arena Selland Arena was originally constructed in 1966 with approximately 6,500 seats. Following an expansion of seating in 1983, it currently offers a seating capacity of approximately 10,220 for basketball events. The facility also underwent other improvements over the last several years which included replacing the arena's concourse flooring, resurfacing/restriping the parking lot, and upgrading the arenas sound system. Selland Arena does not have any club seats or luxury suites.

Selland Arena along with the William Saroyan Theater and Exhibit Hall are located within the Fresno Convention Center in downtown Fresno. Selland Arena currently has two anchor tenants, the Fresno State Bulldogs men's basketball team as well as the West Coast Hockey League (WCHL) Fresno Falcons. Along with the usage from its anchor tenants, the arena hosts a wide variety of other events including concerts, family shows, sporting events, conventions and other miscellaneous events.

From 1993-94 through 1996-97 Selland Arena averaged approximately 131 events, dropping to approximately 86 in 1999-2000. The majority of the reduction of events can be attributed to the relocation of convention/trade shows to the expanded Fresno Convention Center.

Regional Competitive Assessment - 150 - Mile Radius In addition to evaluating the local market area, ERA identified competitive facilities within the region to understand the current and potential competition in attracting events to the proposed arena. We identifiedmarket areas located within a 150-mile radius of Fresno that have arenas with at least 5,000 seats that accommodate primarily basketball, hockey, indoor football, indoor concerts, performing arts, or other relevant arena events from references including: The 2001 AuclArena Stadium Guide, The 2000Survey of BuyingPCMt er (Sales & Marketi ng Managerrent) , Revenuesfrom Sports Venues, various league media guides, etc. and the ERA database. Permanent seats plus portable seats were used to determine the total arena-seating inventory. Table III-13 summarizes the results of this analysis.

• Two MSA market areas within a 150-mile radius have been identified as having at least one arena (indoor venue) with in excess of 5,000 seats.

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• The two MSA market areas include Fresno (CA) and Bakersfield (CA). • Of the two identifiedmarkets, the Fresno MSA ranks 181 in terms of total population with approximately 925,900 residents, while the Bakersfield MSA ranks last with over 657,800 residents. The average population of the two identifiedmarkets is approximately 791,900 persons. • The Bakersfield MSA has the largest inventory of arena seats within a 150-mile radius, with 10,400. The Fresno MSA ranks 2"d with 10,220 seats. The average number of arena seats within each identifiedmarket area is approximately I 0,310. • The average ratio of total population per arena seat forthe identifiedmarket areas is 76.9. Of the two identifiedmarket s, the Fresno MSA has the highest ratio of total population to total arena seats at approximately 90.6 persons per arena seat. • When the Save Mart Center is added to the Fresno Market, the average population per seat in the 150-mile radius will be 49.3, and the Fresno population per seat will be 35.3. Table 111-13 Arena Seating Inventory - 150 Mile Radius Population Total Seating Population Per Seat MSA (OOO's) Rank Seats Rank Persons Rank

Fresno 925.9 1 10,220 2 90.6 1 Bakersfield 657.8 2 10,400 I 63.3 2

Average 791.9 I 0,3 IO 76.9

Source: Sales & Marketing Management - 2000 Survey of Buying Power, AudArena Stadium - 2001 International Guide, and ERA.

Regional Competitive Assessment -250 - Mile Radius In addition to the 150-mile radius, ERA also analyzed the market areas located within the larger regional area, which may be competitive to the proposed Save Mart Arena. In this section, we identified market areas located within the 250-mile market ring surrounding the City of Fresno that have arenas with at least 5,000 seats from references including: The 2001 AuclArenaSt adium Guide, The 2000Su rvey of Buying PONer (Sales & Ma rketing Managerrent), Revenuesfrom Spo rts Venues, various league media guides, etc. and the ERA database. Permanent seats plus portable seats were used to determine the total arena-seating inventory. Table III-14 summarizes the results of this analysis. Table III-15 lists the major indoor arenas found within a 250-mile radius of Fresno.

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Table 111-14 Arena Seating Inventory - 150 to 250 Mile Radius Population Total Seating Population Per Seat MSA (OOO's) Rank Seats Rank Persons Rank

Los Angeles-Long Beach 9,846.1 1 79,300 1 124.2 2 Bakersfield 657.8 8 10,400 7 63.3 9 Oakland 2,379.7 2 31,478 2 75.6 7 San Francisco 1,776.8 3 21,800 3 81.5 6 San Jose 1,737.9 4 12,391 6 140.3 1 Sacramento 1,576.8 5 17,500 4 90.1 5 Fresno 925.9 6 10,220 8 90.6 4 Ventura 749.4 7 13,500 5 55.5 11 Stockton-Lodi 562.1 9 6, 150 10 91.4 3 Santa Barbara-Santa Maria-Lompoc 413.0 10 6,000 11 68.8 8 Salinas 394.8 11 6,692 9 59.0 10

Average 1,910.9 19,585 85.5

Source: Sales & Marketing Management - 2000 Survey of Buying Power, AudArena Stadium - 2001 International Guide, and ERA.

• Eleven market areas within the 250-mile radius of the proposed arena have been identifiedas having at least one arena with 5,000 or more seats. • Of the eleven identifiedmarkets, the Los Angeles - Long Beach MSA ranks I81 in terms of total population with approximately 9.8 million residents. The Fresno MSA has the 6" largest population base with approximately 925,900 residents. The average population of the eleven identifiedmarkets is approximately 1.9 million persons. • The Los Angeles - Long Beach MSA also has the largest inventory of arena seats within a 250-mile radius, with approximately 79,300. The Fresno MSA ranks t'out of the 11 identified markets with I 0,220 arena seats. The average number of arena seats for each identified market area within a 250-mile radius is nearly 20,000. • The average total population per arena seat ratio for the identified market areas are approximately 85.5. Of these market areas, the Sacramento MSA has the highest ratio at approximately 140.3, while the Fresno MSA has the 4h highest ratio at approximately 90. 6 persons per arena seat. • The three largest arenas within a 250-mile radius include: the Staples Center (20,000) in Los Angeles; the Oakland-Alameda County Arena (19,200); and the ARCO Arena (17,500) in Sacramento. • When the Save Mart Center is added to the Fresno Market, the average population per seat in the 250-mile radius will be 80.4, and the Fresno population per seat will rank I Ith with35.3.

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Table 111-15 Major Indoor Arenas - 250 Mile Radius Facility MSA (California) Seats

150 - Mile Radius Selland Arena Fresno 10,220 Centennial Garden Arena Bakersfield 10,400

150 - 250 Mile Radius Staples Center Los Angeles-Long Beach 20,000 Los Angeles Memorial Sports Arena Los Angeles-Long Beach 16,500 Long Beach Convention Center Arena Los Angeles-Long Beach 14,500 Family Pavilion Los Angeles-Long Beach 12,800 Pico Rivera Sports Arena Los Angeles-Long Beach 5,500 The Pyramid Los Angeles-Long Beach 5,000 Brea Events Center Los Angeles-Long Beach 5,000 Oakland-Alameda County Arena Oakland 19,200 Haas Pavilion Oakland 6,578 Henry J. Kaiser Convention Center- Kaiser Arena Oakland 5,700 ARCO Arena Sacramento 17,500 Monterey Fairgrounds-Pattee Arena Salinas 6,692 Cow Place Arena San Francisco 16,500 War Memorial Gy mnasium San Francisco 5,300 Maples Center San Jose 7,391 Tosa Pavilion San Jose 5,000 The Thunderdome Santa-Barbara-Santa Maria-Lompoc 6,000 University of the Pacific-Alex G. Spanos Center Stockton-Lodi 6, 150 Ventura Co. Fairgrounds Main Arena Ventura 13,500

Source: Sales & Marketing Management - 2000 Survey of Buying Power, AudArena Stadium - 2001 International Guide, and ERA.

COMPARABLE MARKET ANALYSIS In this section, ERA identifiesand analyzes 21 newer and existing United States arenas that are comparable in size and function as the proposed Save Mart Center. An arena in similar size to the proposed Save Mart Center typically does not draw its attendees from the entire MSA, especially in the larger market areas.

The proposed Save Mart Center is unique to many of the comparable arenas discussed in this analysis. Being situated on a campus, the arena has a built in audience and its anchor tenants (University athletics) will not relocate to another city, and have a low probability of ceasing operations.

To varying degrees, mid-sized arenas generally benefit from the demographic make-up of their community. The location of an arena in a large market area, with high spending potential, is clearly a benefit as a result of the enhanced revenue generating opportunities. CACI, Inc. data was

Economics Research Associates CaliforniaSta te University, resnoF Asscx:iation, I nc. ERA Project No. 14042 Page III-28 01 /16;02 used in an attempt to quantify some of the key demographic statistics related to consumer buying power. For the purpose of this analysis, the market areas have been defined using the measurements of 10-, 25-, and 40-mile market rings around the respective arenas. Table III-16 illustrates the comparable arenas, locations, seating capacities, and years built. ERA also noted the facilities that have local universities and colleges as major tenants.

Table 111-16 Comparable Arenas Seating Arena Location Year Built Capacity

Alltel Arena (University ofArkan sas-Little Rock) Little Rock, Arkansas 2000 16,500 Cintas Center (Xavier University) Cincinnati, Ohio 2000 I0,250 De Soto Civic Center Southaven, Mississippi 2000 I0,000 New Orleans Arena (Tulane University) New Orleans, Louisiana 1999 18,500 United Spirit Center (Texas Tech University) Lubbock, Texas 1999 15,000 Family Arena St Charles, Missouri 1999 11,200 First Union Arena Wilkes-Barre, Pennsylvania 1999 I0,500 Sovereign Bank Arena Trenton, New Jersey 1999 I0,000 Schottenstein Center (Ohio State University) Columbus, Ohio 1998 19,500 Mitchell Arena (University of Alabama) Mobile, Alabama 1998 12,800 Centennial Garden Bakersfield, California 1998 I0,400 Bi-Lo Center Greenville, South Carolina 1997 16,000 Crown Coliseum Fayetteville, North Carolina 1997 13,500 The "E" Center West Valley City, Utah 1997 13,000 Cox Arena (San Diego State University) San Diego, California 1997 12,400 Van Andel Arena Grand Rapids, Michigan 1996 12,500 Spokane Arena Spokane, Washington 1995 12,000 World Arena Colorado Springs, Colorado 1995 9,700 Mark of the Quad Cities Moline, Illinois 1993 12,200 The Pyramid (University of Memphis) Memphis, Tennessee 1991 20,000 Pepsi Arena (Siena College) Albany, New York 1989 17,500

Average 1997 13,498

Source: Economics Research Associates.

ERA has analyzed the 22 respective markets (including Fresno) with 1999 demographic data. Specifically, we focused on the total population, the total number of households, and the median household incomes found for the I 0-, 25-, and 40-mile market areas drawn for the arenas.

The CACI, Inc. data illustrate that the Fresno market ranks relatively low compared to the others in terms of an index that attempts to compare various areas with a single number. However, when comparing Fresno with the other defined markets, many of the other facilities realize indirect competition from other large cities, and/or have a greater number of competing facilities within the

Economics Research Associates CaliforniaSta te University, resnoF Asscx:iation,I nc. ERA Project No. 14042 Page III-29 01 /16;02 same market area. This in part explains the apparent disparities found in the total population, household, and income levels projected for the comparable facilities' market areas.

Ten-Mile Market Ring Table III-17 illustrates the demographic statistics foundfor the identifiedaren as. ERA noted the following trends:

• Fresno has a population of 543,664, ranking 6h among the comparable arena markets surveyed. San Diego (CA) ranks first with a population of 1,352,562. The average population for the 22 market areas is approximately 472,300. • Fresno has approximately 188,000 households, again ranking Sh among the other market areas surveyed. San Diego (CA) has the largest number of households with a total of approximately 495,000. The average total number of households forthe 22 market areas is nearly 180,600. • The average household income for Fresno is almost $50,000, ranking 10th among the comparable arena markets studied. Trenton (NJ) ranks first with an average household income of over $66,600. The average household income for the 22 market areas is approximately $48,700.

Twenty-Five Mile Market Ring Table III-18 illustrates the demographic statistics foundfor the identifiedar enas. ERA noted the following trends:

• Fresno has a population of approximately 767,200, ranking 10th among the comparable arena markets surveyed. Trenton (NJ) ranks first with a population of over 2.3 million. The average population forthe 22 market areas is nearly 921,440. • Fresno has approximately 255,200 households, ranking 12th among the other market areas surveyed. Trenton (NJ) has the largest number of households with nearly a total of 850,000. The average total number of households for the 22 market areas is approximately 343,600. • The average household income for Fresno is slightly over $48,000, ranking Iih among the comparable arena markets studied. Trenton (NJ) ranks first with an average household income of nearly $70,000. The average household income for the 22 market areas is approximately $50,700.

Economics Research Associates CaliforniaSta te University, resnoF Asscx:iation,I nc. ERA Project No. 14042 Page III-30 Table 111-17 10-Mile Market Ring

Average HH Arena Location Population Rank Households Rank Income Rank

Cox Arena (San Diego State University) San Diego, California 1,352,562 1 495,044 1 $51,176 7 Schottenstein Center (Ohio State University) Columbus, Ohio 884,615 2 360,814 2 $49,408 11 New Orleans Arena (Tulane University) New Orleans, Louisiana 806,267 3 319,910 3 $43,964 18 Cintas Center (Xavier U Diversity) Cincinnati, Ohio 752,980 4 311,785 4 $46,699 13 The "E" Center West Valley City,Utah 722,984 5 262,246 5 $52,638 5 Proposed Save Mart Arena Fresno, California 543,664 6 188,118 6 $49,942 10 Van Andel Arena Grand Rapids, Michigan 474,183 7 176,891 8 $51,298 6 Family Arena St Charles, Missouri 473,4 16 8 178,798 7 $64,954 2 The Pyramid (University of Memphis) Memphis, Tennessee 452,199 9 170,599 9 $32,562 22 Sovereign Bank Arena Trenton, New Jersey 411,064 10 147,678 11 $66,608 1 World Arena Colorado Springs, Colorado 383,559 11 152,779 10 $50,739 8 Centennial Garden Bakersfield, California 353,066 12 120,927 14 $47,018 12 Pepsi Arena (Siena College) Albany, New York 353,030 13 143,330 12 $55,492 3 De Soto Civic Center De Soto, Mississippi 330,218 14 117,530 16 $39,614 21 Spokane Arena Spokane, Washington 315,168 15 130,764 13 $45,538 15 Mitchell Arena (University of Alabama) Mobile, Alabama 310, 102 16 118,048 15 $41,580 20 Bi-Lo Center Greenville, South Carolina 287,378 17 115,985 17 $54,251 4 Mark of the Quad Cities Moline, Illinois 278,167 18 110,658 18 $50,134 9 Alltel Arena (University of Arkansas-Little Rock) Little Rock, Arkansas 265,818 19 107,122 19 $45,986 14 Crown Coliseum Fayetteville, North Carolina 224,089 20 80,159 21 $44,372 17 NE Penn Arena Wilkes-Barre, Pennsylvania 211,036 21 85,000 20 $42,920 19 United Spirit Center (Texas Tech University) Lubbock, Texas 204,624 22 78,121 22 $45,198 16

Average 472,281 180,559 $48,731

Sources: CACI, Inc. and ERA. Table 111-18 25-Mile Market Ring

Average HH Arena Location Population Rank Households Rank Income Rank

Sovereign Bank Arena Trenton, New Jersey 2,322,339 1 847,783 1 $69,844 1 Cox Arena (San Diego State University) San Diego, California 2,273,792 2 823,400 2 $60,158 2 Family Arena St Charles,Missouri 1,921,450 3 734,171 3 $55,336 5 Cintas Center (Xavier University) Cincinnati, Ohio 1,596,237 4 616,527 4 $53,753 7 Schottenstein Center (Ohio State University) Columbus, Ohio 1,280,955 5 501,281 5 $53,731 8 The "E" Center West Valley City, Utah 1,085,256 6 366,880 8 $57,103 4 New Orleans Arena (Tulane University) New Orleans, Louisiana 1,04 1,830 7 404,398 6 $45,624 18 De Soto Civic Center De Soto, Mississippi 999,651 8 373,830 7 $47,037 13 The Pyramid (University of Memphis) Memphis, Tennessee 978,160 9 364,537 9 $46,588 15 Proposed Save Mart Center Fresno, California 767,238 10 255,194 12 $48,249 12 Van Andel Arena Grand Rapids, Michigan 763,727 11 274,938 11 $53,306 9 Pepsi Arena (Siena College) Albany, New York 718,113 12 285,319 10 $57,387 3 Bi-Lo Center Greenville, South Carolina 620,667 13 245,222 13 $50,672 11 NE Penn Arena Wilkes-Barre, Pennsylvania 558,989 14 221,210 14 $43,6 14 20 World Arena Colorado Springs, Colorado 512,732 15 195,223 15 $54,666 6 Alltel Arena (University of Arkansas-Little Rock) Little Rock, Arkansas 480,881 16 184,158 16 $46,592 14 Mitchell Arena (Universityof Alabama) Mobile, Alabama 457,562 17 171,367 18 $42,881 21 Centennial Garden Bakersfield, California 445,124 18 146,806 19 $45,963 17 Spokane Arena Spokane, Washington 438,182 19 173,621 17 $46,436 16 Crown Coliseum Fayetteville, North Carolina 404,770 20 139,745 21 $4 1,502 22 Mark of the Quad Cities Moline, Illinois 365,648 21 142,930 20 $51,021 10 United Spirit Center (Texas Tech University) Lubbock, Texas 238,376 22 90,109 22 $44,724 19

Average 921,440 343,575 $50,736

Sources: CACI, Inc and ERA. 01 /1 6;02

Forty-Mile Market Ring Table III-19 illustrates the demographic statistics found for the identifiedaren as. ERA noted the following trends:

• Fresno has a population of nearly 987,800, ranking 13th among the comparable arena markets surveyed. Trenton (NJ) ranks first with a population of over 7.0 million. The average population for the 22 market areas is approximately 1.42 million. • Fresno has approximately 319,700 households, ranking 14th among the other market areas surveyed. Trenton (NJ) ranks first with a total of over 2.6 million households. The average total number of households for the 22 market areas is nearly 525,600. • The average household income for Fresno is approximately $47,300, ranking 13th among the comparable arena markets studied. Trenton (NJ) ranks first with an average household income of approximately $66,800. The average household income for the 22 market areas is approximately $49,900.

Arena Seating Inventory Table III-20 illustrates a summary of the total seating inventory and population per seat ratios found in the 22 previously described markets. ERA calculated population per seat ratios for both the 25-mile market area and the total MSA. A higher ratio of venue seats to the population is an indication of the potential need for additional arena venues. As previously indicated, ERA did not include venues with seating capacities of less than 5,000 seats in the total inventory count.

As previously stated, Fresno currently has a total of 10,220 indoor seats (Selland Arena), ranking 21st among the comparable 25-mile market areas, and with the addition of the proposed Save Mart Center it will have a total of 26,220 seats. In relation to its population, Fresno has a population per seat ratio of 75.1 in the 25-mile market area. The highest-ranking 25-mile market area is Trenton (NJ) with a high population per seat ratio of 232.2. The average total seating inventory for the selected 25-mile market areas is 26,562, and the average population per seat ratio is 43.8.

At the MSA level, Fresno ranks 1'd among the 22 MSAs studied with a population per seat ratio of 90.6. The highest-ranking MSA is San Diego (CA) with a population per seat ratio of 105.5. The average population per seat ratio for the 22 MSAs is 41.2.

Economics Research Associates CaliforniaSta te University, resnoF Asscx:iation,I nc. ERA Project No. 14042 Page III-33 Table 111-19 40-Mile Market Ring

Average HH Arena Location Population Rank Households Rank Income Rank

Sovereign Bank Arena Trenton, New Jersey 7,057,463 1 2,601,447 1 $66,810 1 Cox Arena (San Diego State University) San Diego, California 2,760,919 2 999,296 2 $59,394 2 Family Arena St Charles,Missouri 2,436,852 3 923,159 3 $54,505 6 Cintas Center (Xavier University) Cincinnati, Ohio 2,037,467 4 778,641 4 $53,324 7 Schottenstein Center (Ohio State University) Columbus, Ohio 1,669,902 5 645,867 5 $51,942 9 The "E" Center West Valley City, Utah 1,589,650 6 523,716 6 $55,240 4 New Orleans Arena (Tulane University) New Orleans, Louisiana 1,327,271 7 506,115 7 $47,635 11 Van Andel Arena Grand Rapids, Michigan 1,223,409 8 44 1,937 8 $57,202 3 De Soto Civic Center De Soto, Mississippi 1,156,935 9 425,246 11 $46,167 16 The Pyramid (University of Memphis) Memphis, Tennessee 1,137,483 10 419,248 12 $46,380 14 Bi-Lo Center Greenville, South Carolina 1,117,363 11 441,190 9 $47,565 12 Pepsi Arena (Siena College) Albany, New York 1,112,224 12 439,205 10 $54,652 5 Proposed Save Mart Center Fresno, California 987,763 13 319,678 14 $47,318 13 NE Penn Arena Wilkes-Barre, Pennsylvania 952,686 14 369,506 13 $43,830 20 Crown Coliseum Fayetteville, North Carolina 747,266 15 268,209 15 $42,089 22 World Arena Colorado Springs, Colorado 698,385 16 266,307 16 $52,422 8 Alltel Arena (University of Arkansas-Little Rock) Little Rock, Arkansas 645,593 17 242,637 17 $44,717 18 Mitchell Arena (University of Alabama) Mobile, Alabama 639,762 18 237,639 18 $42,659 21 Centennial Garden Bakersfield, California 554,881 19 178,322 21 $44,750 17 Mark of the Quad Cities Moline, Illinois 545,995 20 213,199 20 $48,486 10 Spokane Arena Spokane, Washington 538,672 21 213,542 19 $46,267 15 United Spirit Center (Texas Tech University) Lubbock, Texas 291,800 22 108,744 22 $44,3 19 19

Average 1,419,534 525,584 $49,894

Sources: CACI, Inc and ERA. Table 111-20 Total Seat Inventory for the Comparable Arena Markets

Population Total Area Population/Seat Arena Location 25 - Miles Rank MSA Rank Arena Seats Rank 25 - Miles Rank MSA Rank

I I Sovereign Bank Arena Trenton, New Jersey 2,322.3 337.6 20 10,000 22 232.2 33.8 12 Cox Arena (San Diego State University) San Diego, California 2,273.8 2 2889.9 I 27,400 II 83.0 2 105.5 I Family Arena St Charles, Missouri 1,921.5 3 2,580.6 2 31,423 9 61.1 4 82.1 3 Cintas Center (Xavier University) Cincinnati, Ohio 1,596.2 4 1634.6 3 42,506 4 37.6 9 38.5 8 Schottenstein Center (Ohio State University) Columbus, Ohio 1,281.0 5 1499.8 4 42,976 3 29.8 12 34.9 II

The "E" Center West Valley City, Utah 1,085.3 6 1,275.1 6 48,400 2 224 17 26.3 17 New Orleans Arena (Tulane University) New Orleans, Louisiana 1,041.8 7 1309.8 5 36,877 5 28.3 13 35.5 9 De Soto Civic Center Southaven, Mississippi 999.7 8 1,113 0 7 36,100 6 27.7 14 30.8 14 The Pyramid (University ofMemp his) Memphis, Tennessee 978.2 9 1113.0 7 36,100 6 27.1 15 30.8 14 Save Mart Center Fresno, California 767.2 10 925.9 11 10,220 21 75.1 3 90.6 2 Van Andel Arena Grand Rapids, Michigan 763.7 II 1,0605 9 19,500 14 39.2 8 544 6 Pepsi Arena (Siena College) Albany, New York 718.1 12 870.5 12 17,500 16 41.0 7 49.7 7 Bi-Lo Center Greenville, South Carolina 620.7 13 936.0 10 26,680 12 23.3 16 35.1 10 NE Penn Arena Wilkes-Barre, Pennsylvania 559.0 14 608.8 14 10,500 19 53.2 5 58.0 5 World Arena Colorado Springs, Colorado 512.7 15 509.5 17 48,842 I 10.5 21 104 21 Alltel Arena (University ofArkan sas-Little Rock) Little Rock, Arkansas 480.9 16 564.3 15 32,869 8 14.6 20 17.2 19 Mitchell Arena (University of Alabama) Mobile, Alabama 457.6 17 537.8 16 23,476 13 19.5 19 22.9 18 Centennial Garden Bakersfield, California 445.1 18 657.8 13 10,400 20 42.8 6 63.3 4 Spokane Arena Spokane, Washington 438.2 19 419.0 18 12,500 17 35.1 10 33.5 13 Crown Coliseum Fayetteville, North Carolina 404.8 20 286.1 21 18,700 15 21.6 18 15.3 20 Mark of the Quad Cities Moline, Illinois 365.6 21 359.8 19 12,000 18 30.5 II 30.0 16 United Spirit Center (Texas Tech University) Lubbock, Texas 2384 22 235.5 22 29,405 10 8.1 22 8.0 22

Average 9214 987.5 26,562 43.8 41.2

Sources: CACI, Inc., Sales & Marketmg Management "2000 Survey of Buymg Power", Aud.Arena 2000 Stadium Gmde, and ERA 01/16;0 2

Section IV

COMPETITIVE AND COMPARABLE FACILITIES/TENANTS

This section is an overview analysis and brief description of competitive Fresno facilities; comparable arenas throughout the United States; Western Athletic Conference (WAC); potential additional anchor tenants/leagues; and concert and other venue event data.

COMPETITIVE FRESNO FACILITIES The extent of existing competitive facilities in the Fresno area is limited. Although, there are facilities that exhibit similar functions and/or size in the City of Fresno. This analysis assumes that Selland Arena will still be in the market to attract "other events". We have assumed market rates on the leases at the proposed Save Mart Center on the "other events" in order to compete with Selland Arena. ERA believes that the other venues will not pose much of a competitive threat to the proposed Save Mart Center.

Selland Arena Selland Arena was originally constructed in 1966 with approximately 6,500 seats. Following an expansion of seating in 1983, it currently offers a seating capacity of approximately 10,220 for basketball events. The facility also underwent other improvements over the last several years, which included replacing the arena' s concourse flooring, resurfacing/restriping the parking lot, and upgrading the arenas sound system.

Selland Arena along with the William Saroyan Theater and Exhibit Hall are located within the Fresno Convention Center in downtown Fresno. Selland Arena currently has two anchor tenants, the Fresno State Bulldogs men's basketball team as well as the WCHL Fresno Falcons. Along with the usage from its anchor tenants, the arena hosts a wide variety of other events including concerts, family shows, sporting events, conventions and other miscellaneous events.

From 1993-94 through 1996-97 Selland Arena averaged approximately 131 events, dropping to approximately 86 in 1999-2000. The majority of the reduction can be attributed to the relocation in convention/trade shows to the expanded Fresno Convention Center.

Economics Research Associates California StateUn iversity, F resnoAss ociation,I nc. ERA No. 14042 Page IV-1 01 /16;02

Fresno Convention Center The Fresno Convention Center was opened in October of 1966. The success of the complex was greater than ever expected by even the most optimistic supporters. It was the last word in functional efficiency for cultural, social and convention use in the Central Valley area.

Originally the complex consisted of three separate buildings that sat under one roof line and were separated by 90 foot mallways. The three entities consisted of the William Saroyan Theatre, a 32,000 square foot exhibit hall with 12 meeting rooms and the Selland Arena which seated 6,500.

The complex now spans over five city blocks and boasts five separate facilities. The expansion of Selland Arena in 1981 brought a maximum seating capacity of 11,300. The exhibit hall was converted to a ballroom in December 1999 upon the construction of the new 77,000 square foot exhibit hall which encompasses 25 meeting rooms in addition to housing the Center's administration and operation divisions.

Class-AAA Baseball League Stadium On June 27, 2001 the Fresno Redevelopment Agency started to prepare the ground for construction on the new Triple-A stadium which will be the new home of the Fresno Grizzlies Triple-A baseball team. The stadium is scheduled to open in May 2002.

The Big Fresno Fairgrounds The Big Fresno Fairgrounds was built in 1884 and incorporates the 5,000-seat Paul Theater and the 5,125-seat Grandstand, which also has standing room for 15,000. Additionally, the Fairgrounds has two exhibit buildings, the 25,000-square foot Commerce Building and the 19,000-square footAgri culture Building.

COMPARABLE UNITED STATES ARENAS Below is an overview analysis of the physical and operational characteristics of 21 comparable arenas which have been recently built. The primary purpose of this overview is to illustrate the trends and characteristics of selected comparable arenas. Data utilized was accumulated from our existing database, information received from various publications, and interviews with facility management.

This comparative analysis was prepared to gain a perspective from which to evaluate the potential operational performance and event levels of the proposed Save Mart Center relative to similar recently built facilities.

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Table IV-I presents the arena name, location, year built, seating capacity and number of luxury suites and club seats, and event information. Universities in parentheses indicates that university is a tenant. The anchor tenants noted for the comparable facilities are forthe 2000-01 fiscal year unless otherwise noted. The summary below includes a brief description of each of the comparable facilities.

Table IV-1 Comparable Arenas

Year Seating Luxury Club Events Arena Location Built Capacity Suites $000's Seats Anchor Total

Alltel Arena (University ofArkansas -Little Rock) Little Rock, Arkansas 2000 16,500 28 $22-$50 -- 36 119 Cintas Center (Xavier University) Cincinnati, Ohio 2000 10,250 22 $40 1,000 -- -- De Soto Civic Center Southaven, Mississippi 2000 10,000 12 $35-$45 ------New Orleans Arena (Tulane University) New Orleans, Louisiana 1999 18,500 44 $26-$33 1,400 33 91 United Spirit Center (Texas Tech University) Lubbock, Texas 1999 15,000 24 $20 ------Family Arena St Charles, Missouri 1999 11,200 44 $25-$75 300 35 97 First Union Arena Wilkes-Barre, Pennsy1 vania 1999 10,500 32 $35-$38 624 34 101 Sovereign Bank Arena Trenton, New Jersey 1999 10,000 34 $40-$60 1,150 37 121 Schottenstein Center (Ohio State University) Columbus,Ohio 1998 19,500 52 $45-$65 0 -- -- Mitchell Arena (University ofAlabama) Mobile, Alabama 1998 12,800 16 $10 1,000 -- -- 1 Centennial Garden (CSUB ) Bakersfield, California 1998 10,400 27 $25-$75 1,000 46 122 Bi-Lo Center Greenville, South Carolina 1997 16,000 30 $45-$55 840 45 140 Crown Coliseum Fayetteville, North Carolina 1997 13,500 10 $35 -- 36 89 The "E" Center West Valley City,Utah 1997 13,000 40 $35-$50 540 45 140 Cox Arena (San Diego State University) San Diego, California 1997 12,400 0 -- 0 -- -- Van Andel Arena Grand Rapids, Michigan 1996 12,500 44 $25 1,800 36 173 Spokane Arena Spokane, Washington 1995 12,000 16 $25-$35 -- 47 137 World Arena Colorado Springs, Colorado 1995 9,700 -- -- 400 32 114 Mark ofthe Quad Cities Moline, Illinois 1993 12,200 15 $22-$29 -- 40 146 The Pyramid (University ofMemphis) Memphis, Tennessee 1991 20,000 26 $35-$65 ------Pepsi Arena (Sienna College) Albany, New York 1989 17,500 25 $44 75 35 179

Save Mart Center (Fresno State ) Fresno, California 2003 16,000 32 $52 1,108 48 121

Source: Economics Research Associates. Note: (1) California State University, Bakersfield.

Alltel Arena - (University of Arkansas-Little Rock) The Alltel Ar ena is located in LittleRock, Arkansas. Opened in 1999, the multi-purpose facilityfeatu res approximately 16,500 seats and 28 private suites and four party suites, ranging in price from $21,900 to $50,000 annually, excluding tickets. The arena is currently home to the East Coast Hockey League's (ECHL) Arkansas Riverblades, the Arkansas Twisters of the Arena Football League 2's (AF2), and the University of Arkansas-Little Rock men's and women's basketball teams. The Alltel Arena also hosts events such as concerts, high school sporting

Economics Research Associates California StateUn iversity, F resnoAss ociation,I nc. ERA No. 14042 Page IV-3 01 /16;02 events, other professional sporting events, family shows, meetings, and other events. The facility is owned by the Pulaski County and is operated by SMG Management.

Cintas Center - (Xavier University) The Cintas Center is located on the campus of Xavier University in Cincinnati, Ohio. Opened in July 2000, the $46 million arena has a maximum seating capacity of 10,250. The venue features 22 luxury suites, 1,200 club seats, and 3,800 premium seats. Designed to be a multi-use event venue, Cintas Center also houses a 27,000 square foot conference and banquet facility, and a student-dining hall capable of seating 450 people. Cintas Center is home to Xavier University men's and women's basketball teams, as well as two nationally televised prizefights, USA wrestling, local high school events, and three major religious events. During its first operating year, the Cintas Center hosted a total of 65 events in the arena and 929 events in the conference and banquet facility, drawing an estimated 350,000 attendees ..

DeSoto County Civic Center The DeSoto CountyCi vic Center is located in Southhaven, Mississippi, approximately 15 miles from Memphis, Tennessee. The $32 million facility opened in August of 2000. The facility has a seating capacity of 10,000 seats and 12 luxury suites. Ranging from 10 to 16 seats in maximum capacity, luxury suites are leased on three- to seven-year terms and are priced from $35,000 to $45,000 per year. Primarily built for hockey, the facility is home to the Central Hockey League's (CHL) Memphis RiverKings, in addition to the American Basketball Association's (ABA) Houn'Dawgs and the AF2 Explorers. The facility also includes approximately 20,000 square feet of convention center space and a performing arts center with approximately 400-seats. The DeSoto County Civic Center is owned and managed by the DeSoto County Convention and Visitors Bureau.

New Orleans Arena - (Tulane University) The NaNOrle ans Arena is located adj acent to the Superdome in downtown New Orleans. Completed in 1999, the facility has a seating capacity of approximately 18,500 seats and incorporates 1,400 club seats and 44 executive suites. The price for an executive suite ranges from$25 ,500 to $33,000 per annum, excluding tickets.

The New Orleans Arena is home to the ECHL New Orleans Brass and Tulane University men's and women's basketball teams. The arena also hosts various concerts, high school sporting events, other professional sporting events, family shows, meetings, and other events. Specifically, the arena reportedly held 15 family shows, 53 sporting events, 15 concerts, two

Economics Research Associates California StateUn iversity, F resnoAss ociation,I nc. ERA No. 14042 Page IV4 01 /16;02 meetings, one graduation, four religious events, and one miscellaneous event in 2000. The New Orleans Arena is owned by the Louisiana State Exposition District and is operated by SMG.

United Spirit Arena - (Texas Tech University) The UnitedSp irit Arena is located on the campus of Texas Tech University in Lubbock, Texas. Opened in 1999, the $62 million United Spirit Arena has a seating capacity of approximately 15,000.seats and incorporates 24 luxury suites that are leased on IO-year terms. The luxury suites range in price from $20,000 a year. The arena is home to Texas Tech University men's and women's basketball and volleyball teams and is also used for other school sporting events, commencement ceremonies, concerts and exhibition shows.

Family Arena The F ani ly Arena is located in St. Charles, Missouri, approximately 25 miles from downtown St. Louis. Opened in September 1999, the arena seats approximately 10, 100 and 11,200 for hockey and basketball, respectively. The arena incorporates 44 private suites, all of which are leased on three- to seven-year terms, and two party suites. The suites range in price from $25,000 to $75,000 a year, depending on suite location and whether the suites include tickets to sports-only or all events at the arena. In addition to the private suites, there are 300 club seats that are leased on a two-year basis for $888 annually per seat.

The arena is home to the United Hockey League's (UHL) Missouri River Otters, the Maj or Indoor Soccer League's (MISL) St. Louis Steamers, and the National Indoor Football League's (NIFL) River City Renegades. The new $39 million arena is owned by St. Charles County and is operated by Family Arena Management Enterprises.

First Union Arena TheFi rst Union Arena, (formerly named the Northeastern Pennsylvania Arena) is located in Wilkes-Barre, Pennsylvania. The $44 million venue opened in November 1999, and seats 10,500 for concerts, 8,700 for basketball and 8,500 for hockey and other ice events. TheFirst Union Arena incorporates 32 luxury seats that are leased on three- to five-yearterm s for $35,000 to $37,500 a year, which includes tickets forhockey only. The arena also incorporates 624 club seats that are leased on one- to five-yearterm s for $1,000 to $1,500 a year.

The First Union Arena is home to the American Hockey League (AHL) Wilkes-Barre/Scranton Penguins and the AF2 Wilkes-Barre/Scranton Pioneers. Since its opening, the arena has also hosted a variety of other events from inaugural events, concerts, family shows and trade shows.

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The facility is currently owned by Lucerne County Convention Center Authority and is operated by SMG.

Sovereign Bank Arena The Sovereign Bank Arena is located in Trenton, New Jersey. Built in 1999, the $53 million state-of-the-art sports and family entertainment facility seats approximately 8, 100 for hockey, 8,600 for basketball, and up to 10,000 for concerts and special events. The arena offers 34 private luxury suites that cost $45,000 to $60,000 per lease contract, which includes tickets to all events. The facility's 1,150 club seats are priced at approximately $925 per seat for all sporting events. The arena also features a fully equipped in-house television system with a LED video scoreboard. The Sovereign Bank Arena is home to the ECHL Titans.

Schottenstein Center - (Ohio State University) The Schottenstei n Center is located on the campus of Ohio State University in Columbus, Ohio. Built in 1998, the $35 million facility seats approximately 19,500 for basketball, 17,500 for hockey, and up to 21,000 for concerts. There are 52 luxury suites located at mid-level that completely encircle the floor. Leased on five to nine-year terms, the luxury suites range in price from $45,000 to $65,000 a year. The Schottenstein Center is home to the Ohio State University Buckeye men's and women's basketball and hockey teams. The arena is owned by the Schottenstein family, after which it was named.

Mitchell Center - (University of South Alabama) The Mitchel l Center is located on the campus of the University of South Alabama in Mobile, Alabama. The facility was builtin 1998 with a seating capacity of 10,000 for basketball games, 7,000 for end-stage configuration events, and 5,500 for theatrical stage events. The Mitchell Center incorporates 16 private suites that are sold on a three-year lease for $10,000 per year. This price includes eleven tickets to each basketball game, with the option to purchase up to nine more tickets in the regular seating bowl.

The Mitchell Center houses the University of South Alabama men' s and women's basketball teams. The arena hosts approximately 56 events each year, including 26 varsity basketball games, seven concerts, eight high school graduations, four family shows, and various other events.

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Centennial Garden - (CaliforniaSt ate University, Bakersfield) The Centennial Garden is located in Bakersfield, California. Opened in 1998, the $38 million arena seats approximately 10,400 and features 27 luxury suites, which are leased on three to seven-year terms for $25,000 to $75,000 a year. There are 1,000 club seats that are leased on a two-year term for $585 a year. The club seat package includes in-seat wait service, parking, private club and the right to purchase tickets to other events.

The arena is home to the West Coast Hockey League (WCHL) Bakersfield Condors, the AF2 Bakersfield Blitz, and California State University, Bakersfield (CSUB) men's and women's basketball teams. The facility is owned by the city of Bakersfield and is managed by SMG. Besides hosting athletic games, the Centennial Garden also houses concerts, family shows and large conferences.

Bi-Lo Center The Bi-lo Center is located in Greenville, South Carolina. Built in 1998, the Bi-Lo Center has a seating capacity of approximately 16,000 for hockey and basketball. The Center incorporates 30 suites that range in price from $45,000 to $55,000 a year and includes tickets to all Bi-Lo Center events. In addition to the private suites, there are approximately 840 club seats, which are leased on an annual basis for $1,500. The club seats include hockey and football season tickets, and the right to purchase tickets to all other events.

The Center is home to the ECHLGreen ville Grrowls, the AF2 Carolina Rhinos, and the National Basketball Development League's (NBDL) Greenville Groove. The Bi-Lo Center is used fora variety of other events besides the professional athletic teams' home games. In 1999, the Center hosted 47 Grrowls games, eight Rhino games, 27 concerts, six family shows, 14 other sporting events, 14 collegiate events, one high school graduation, and 15 banquets and meetings throughout the year.

The facility is currently owned by the Greenville Memorial Auditorium District (District) and is operated by Volume Services America (VSA). The District, along with the City of Greenville and the County of Greenville, entered into an operating agreement with VSA. Pursuant to the agreement, VSA was appointed the sole and exclusive manager of the Bi-Lo Center foran initial term equal to fifteen years.

VSA has all of the District' s rights and powers to manage, maintain and improve the Bi­ Lo Center. As compensation for its services, VSA receives a base management fee equal to $500,000 per year (subject to inflation adjustment) plus a percentage of suite premium seat and

Economics Research Associates California State University, F resnoAss ociation,I nc. ERA No. 14042 Page IV-7 01 /16;02 advertising revenues. In any year in which operating and seat tax revenues of the Bi-Lo Center equal or exceed a base amount (initially $4,000,000 subj ect to adj ustment as provided in the Agreement), VSA receives an incentive management fee equal to $200,000 (subj ect to inflation adjustment).

Crown Coliseum TheCu rrterland County CrCMln Col iseum (Crown Coliseum) is located in Fayetteville, North Carolina. Opened in 1997, the $55 million arena is part of a four-building Civic Center complex, which includes a 60,000 square foot expo center, a 5,200-seat arena, and an 11,250 square foot ballroom and hospitality room. The Crown Coliseum has a total seating capacity of 13,500 (10,000 permanent and 3,500 portable), in addition to 10 private suites, which are leased for approximately $35,000.

The facility was home to the CHL Fayetteville Force up until the franchises folded at the end of the 2000-01 season. The arena is currently home to the NBDL Fayetteville Patriots as well as the AF2 Cape Fear Wild Cats. Cumberland County owns the arena, while VSA is responsible forall food operations.

The "E" Center The " E" Center is located in West Valley City, Utah, approximately 10 miles from Salt Lake City. Opened in 1997, the arena has approximately 10,500 and 11,600 seats for hockey and basketball, respectively, and incorporates 40 suites ranging in price from $35,000 to $50,000 per year. Luxury suites include tickets to only the Grizzlies and the Freeze games. In addition to the private suites, there are 540 club seats priced at $1,200 annually for Grizzlies' games only.

The "E" Center is home to the AHLUtah Grizzlies, the MISL Utah Freezz, and the NIFL Wasatch Wolverines. The facility is owned by West Valley City and is operated by Centennial Management Group.

Cox Arena - (San Diego State University) The Cox Arena is located on the campus of San Diego State University (SDSU) in California. The facility has a 12,400 seating capacity and does not have any premium seating. The California State University, using a mandatory student center fee, financed the arena at $52 million. The Cox Arena is used to host university men's and women's basketball teams, as well as other events, including The Boston Pops, Sesame Street Live, and World Championship

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Wrestling. In 2001, the Men's NCAA regional basketball tournament was held at Cox Arena. The Cox Arena is operated by the Associated Students of SDSU.

Van Andel Arena The Van An del Ar ena is located in Grand Rapids, Michigan. Built in 1996, the arena has a total seating capacity of 12,500 for concerts (10,500 permanent and 2,000 portable). The arena has 44 private suites and 1,800 club seats. The facility is home to the Arena Football League's (AFL) Grand Rapids Rampage as well as the AHL Grand Rapids Griffins.

The arena is owned by the City ofGrand Rapids and is operated by SMG. Under the agreement, the City paid SMG a base management fee of $150,000 in 1996, which increased to a base of $240,000 in 1997. From 1997 to the present, the base management feehas increased each fiscal year by the percentage change in the Consumer Price Index (CPI), which is not to exceed 5 percent. In addition to the base management fee, SMG also receives an incentive fee based on the results of operations of the arena compared to certain revenue thresholds. To qualify for the incentive fee, operating revenues must exceed operating expenses by at least $750,000.

Spokane Arena TheSpo kaneAr ena is located in Spokane, Washington. Opened in September 1995, the facility has a basketball and hockey seating capacity of 12,000 and 10,440, respectively. The arena incorporates 16 suites, which are leased on a five-year basis, with annual lease prices ranging from $25,000 to $35,000. The suite lease price includes tickets to all arena events.

The arena's primary tenant is the Western Hockey League's (WHL) Spokane Chiefs. Ingeneral , the arena hosts a significant number of hockey games, concerts, family shows, area high school and other sporting events, as well as a variety of other events. Of the 104 events held in 2000, 4 7 of the events utilized the arena's ice sheet. According to management, these ice events drew an average attendance of at least 1,000 people The remaining 57 events included basketball and volleyball games, monster trucks, wrestling, a circus, trade and consumer shows and other events using the arena's floor. Of these events, 36 attracted fewer than 7,000 spectators. The arena is currently owned by the Spokane Public Facilities District and is operated by the Cityof Spokane.

World Arena The World Ar ena is located in Colorado Springs, Colorado. Opened in 1998, the arena offers 9,700 and 7,400 seats for basketball and hockey events, respectively. There are also 400 club seats available for lease in the building. The arena' s primary tenants are Colorado Colleges

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Rental rates fornon-university events ranges from 10 to 12 percent of gross ticket sales, while a flatfee ranging from $1,500 to $5,000 is charged for community, non-profit events. The World Arena is privately owned and operated by Global Spectrum, a private management entity. Management stated that they have a good working relationship with the school and minor league hockey franchise, as scheduling conflicts rarely occur. While non-university events have first priority in scheduling events, management provides the University the list of non-University events far enough in advance that allows the school to schedule their games accordingly. Once University games are scheduled, the date is locked for the University and is no longer open to the market.

Mark of the Quad Cities The Mark of the Quad Citiesis located in Moline, Illinois. Built in 1993, the arena has a capacity of approximately 12,200 seats. In addition, the Mark has 15 skyboxes, 14 of which are leased to the public and one retained by management. The primary tenants of the facility include the UHL Quad City Mallards and the AF2 Quad City Steamwheelers. The two teams host a combined total of approximately 50 home games annually.

The arena is owned and managed by the Quad City Civic Center Authority (QCCCA), which represents the Cities of Moline (IL), Rock Island (IL), Davenport (IA) and Bettendorf(IA) .

The Pyramid Arena - (University of Memphis) ThePy ranid Ar ena is located on the campus of the University of Memphis in Tennessee. Built in 1991, the $68 million Pyramid has a seating capacity of 20,000 for basketball and 21,000 forconcerts. There are 26 luxury suites that lease forthre e-year terms at approximately $35,000 to $65,000 per year. The facilityis home to the National Basketball Association (NBA)Memphis Grizzlies and the University of Memphis men's basketball program. The facility is also well known for hosting concerts, family shows and national basketball tournaments, such as the 1997 and 2001 NCAA men's basketball tournament, 1996 Conference USA men's basketball tournament, and 1994 and 1997 SEC's men's basketball tournament. The Pyramid is owned by Shelby County, City of Memphis and managed by SMG.

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Pepsi Arena - (Siena College) The Pepsi Ar ena, formerly known as the Knickerbocker Arena, is located in Albany, New York. Originally built in 1989, the facility was renamed the Pepsi Arena in 1997. The arena has a seating capacity of approximately 17,500 seats (15,000 permanent and 2,500 portable) and incorporates 25 luxury suites (16 seats per suite), and 75 club seats. The luxury suites have a lease price of $44,000 per year, including tickets to all events, and the club seats are priced at $550 per season forthe River Rats hockey season.

The Pepsi Arena. is home to the AHL Albany River Rats, National Lacrosse League's (NLL) Albany Attack, and Siena College men's basketball team. The arena is also used for a variety of other events besides sporting events. In 2000, the Pepsi Arena hosted 40 family shows, 95 sporting events, 22 concerts, fourtrade shows, 12 public shows, one meeting, two graduations, and three miscellaneous events. The facility is owned by Albany County and is operated by SMG.

WESTERN ATHLETIC CONFERENCE (WAC) Fresno State is a member of the Western Athletic Conference (WAC). The WAC began operation with the 1962-63 academic year, and several changes have occurred since. Its original year had six charter members, including: Arizona; Arizona State; Brigham Young; New Mexico; Utah; and Wyoming. Since that time membership additions included: San Diego State (1978); Hawaii (1979); United States Air Force Academy (1980); Fresno State (1992); University of Nevada, Las Vegas (1996); Rice (1996); San Jose State (1996); Southern Methodist University (1996); Texas Christian University (1996); and Tulsa (1996). In 2001, Boise State University and Louisiana Tech joined the WAC. Air Force, Brigham Young, Colorado State, University of Nevada, Las Vegas, New Mexico, San Diego State, Utah, and Wyoming withdrew in June 1999.

Table IV-2 illustrates the current WAC schools, their school enrollment, and their respective basketball arenas.

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Table IV-2 Western Athletic Conference Member Schools and Arenas

School Knickname Enrollment Basketball Arena Year Built Capacity

California State University, Fresno Bulldogs 19,118 Selland Arena 1966 10,300 University of Hawaii Rainbow Warriors 17,353 Stan Sheriff Center 1994 10,225 University of Nevada Wolf Pack 12,400 Lawlor Events Center 1983 12,500 Rice University Owls 2,600 Autry Court 1950 5,000 San Jose State University Spartans 27,000 San Jose Event Center 1989 4,850 Southern Methodist University Mustangs 9,708 Moody Coliseum 1965 8,998 Texas Christian University Homed Frogs 7,210 Daniel-Meyer Coliseum 1961 7, 166 University ofTexas, El Paso Miners 15,393 Don Haskins Center 1977 12,222 University of Tulsa Golden Hurricane 4,300 Donald W. Reynolds Center 1998 8,310 Boise State University 1 Broncos 15,500 BSU Pavilion 1982 12,500 Louisiana Tech University 1 Bulldogs 10,000 Thomas Assembly Center 1982 8,000

Average 12,780 1977 9,097

Sources: Western Athletic Conference and Economics Research Associates. Note: (1) Joined conference in 2001-2002 school year.

POTENTIAL ADDITIONAL ANCHOR TENANTS/SPORTS LEAGUES In assessing the potential demand for the proposed Save Mart Center as a sports venue, ERA identifiedthe following leagues, which besides the University, we believe would potentially be most likely to utilize the proposed Save Mart Center as their home. These leagues include: WCHL; CBA; NBDL; AF2; NIFL; and MISL. This list in not intended to be inclusive, rather it is a representation of possible leagues to be considered as second tenants.

Based on conversations with the Association, we have assumed an additional anchor tenant in this analysis. If the additional anchor tenant does not play its home games in the Save Mart Center, the results of the analysis will change.

West Coast Hockey League The West Coast Hockey League (WCHL) originated with six franchises located in: Anchorage, Alaska; Bakersfield, California; Fairbanks, Alaska; Fresno, California; Reno, Nevada; and San Diego, California. The league quickly established an expansion committee and new teams in the following cities: Boise, Idaho; Phoenix, Arizona; Tacoma, Washington; and Tucson, Arizona. Colorado Springs, Colorado was added prior to the 1998-99 season and Long Beach, California was added prior to the 2000-01 season. The Phoenix Mustangs played in the WCHL through the 2000-01 season. Table IV-3 lists the 2001-02 WCHL franchises and their corresponding arenas:

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Table IV-3 West Coast Hockey League Seating Franchise City Arena Capacity 1

Anchorage Aces Anchorage, AS Sullivan Arena 6,208 Bakersfield Condors Bakersfield, CA Centennial Garden 10,400 Colorado Gold Kings Colorado Springs, CO World Arena 7,354 Fresno Falcons Fresno, CA Selland Arena 11,300 Idaho Steelheads Boise, ID Bank of America Centre 5,500 Long Beach Ice Dogs Long Beach, CA Long Beach Arena 12,000 San Diego Gulls San Diego, CA San Diego Sports Arena 12,920 Tacoma Sabercats Tacoma, WA Tacoma Dome 8,800

Sources: West Coast Hockey League, and Economics Research Associates. Note: (1) Maximum capacity for ice events.

The WCHL attracts players from the National Collegiate Athletic Association (NCAA) and the Canadian Interuniversity Athletic Union (CIAU) programs to junior leagues throughout North America, as more young players each season are heading west to begin their professional careers. The WCHL features "graduates" from the three major junior leagues, the WHL; Ontario Hockey League (OHL), and Quebec Major Junior Hockey league (QMJHL), as well as three junior "A" leagues in the United States.

Table IV-4 illustrates the WCHL historical attendance reported from the inception of the WCHL through the recently completed season:

Table IV-4 WCHL His torical Attendance Average Year Attendance

2000-01 4,491 1999-00 2,963 1998-99 3,016 1997-98 3,663 1996-97 4,262 1995-96 4,668

Sources: WCHL and ERA.

The Fresno Falcons averaged approximately 5,300 attendees per event in the 2000-01 season at Selland Arena.

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Continental Basketball Association The original Continental Basketball Association (CBA) operated for over 50 years as an unofficial minor league/feeder program to the National Basketball Association (NBA). The CBA seized its operations in February 2001. Recently, the league formed a new LLC. The league will have the same name with new opportunities. The new CBA will have 13 "founding partners." The league began play in mid-November 2001 and will conclude with the playoffs in mid-March 2002. Currently, some of the franchises will play 40 games, while others will play 56 games. The fluctuation is due to available dates in the respective arenas. League goals for average season ticket sales range from 1,400 to 1,800 per franchise. Table IV-5 illustrates the new CBA franchises and their home arenas forthe inaugural season.

Table IV-5 Continental Basketball Association Franchises and Arenas Seating Franchise City Arena Capacity 1

Dakota Wizards Bismarck, ND Bismarck Civic Center 9,090 Fargo-Moorhead Beez Fargo, ND The FargoDome 12,000 Flint Fuze Flint, MI IMA Sports Arena 4,030 Gary Steelheads Gary, IN Genesis Convention Center 6,900 Grand Rapids Hoops Grand Rapids, MI DeltaPlex Entertainment and Expo Center 6,000 Rockford Lightning Rockford, IL Rockford MetroCentre 8,900 Saskatchewan Hawks Saskatchewan, Canada Saskatchewan Place 11,500 Sioux Falls Skyforce Sioux Falls, SD Sioux Falls Arena 6,400

Sources: Continental Basketball Association, AudArena Stadium Guide (2002), and Economics Research Associates. Note: (1) Maximum capacity for basketball games.

The remaining five"founding partners" will begin play in 2002-03. These cities include:

• Winnipeg, Canada • Yakima, Washington • Fort Wayne, Indiana • Boise, Idaho • La Crosse, Wisconsin The league plans to expand into the western states, including California, Arizona, Nevada, and Colorado, among others.

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National Basketball Development League The NBA recently started a new development league known as the National Basketball Development League (NBDL). The NBDL began its inaugural season in November 2001 with teams based in eight Southeastern U.S. cities. The NBDL has a 56-game regular season schedule that runs from mid-November through March, followed by playoffs.

Players must be 20 years of age or older to play in the NBDL. Although NBDL teams do not have direct affiliation with specific NBA teams, development league players are eligible to play for any NBA team.

Designed to help grow the sport of basketball both domestically and internationally, the NBDL offers players the opportunity to develop their talent in a highly competitive atmosphere under the NBA' s umbrella. In addition to being a source of on-court talent for the NBA' s 29 teams, the NBDL will also serve as a diverse human resource pool forthe NBA and its teams, as it will train employees in management, operations, public relations and marketing positions in each NBDL city.

Table IV-6 lists the eight founding NBDL franchises and their corresponding areas for the inaugural season (2001-02).

Table IV-6 National Basketball Development League Franchises and Arenas

Seating Franchise City Arena Capacity 1

Columbus Riverdragons Columbus, GA Columbus Civic Center 8,720 Fayetteville Patriots Fayetteville, NC Cumberland County Crown Coliseum 4,980 Greenville Groove Greenville, SC Bi-Lo Center 15,000 Huntsville Flight Huntsville, AL Von Braun Center 6,700 Mobile Revelers Mobile, AL Mobile Civic Center 8,000 North Charleston Longators North Charleston, SC North Charleston Coliseum 12,000 Roanoke Dazzle Roanoke, VA Roanoke Civic Center - Coliseum 10,100 Ashville Attitude Asheville, NC Asheville Civic Center 6,860

Sources: National Basketball Development League, AudArena Stadium Guide (2002), and Economics Research Associates. Note: (1) Maximum capacity for basketball games.

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Arena Football 2 The first arena football game was played in 1986 in Rockford, Illinois and the league Arena Football League played its inaugural season in 1987 with four teams. The league evolved over the years with annual attendance reaching over 1.0 million several times in the mid to late 1990s.

With the popularity of the sport evolving, Arena Football 2 (AF2) was formed in late 1999 to early 2000. Their AF2's inaugural season consisted of 15 franchises located primarily in the southeastern United States, the will expand to 35 franchises for the upcoming 2002 season and are expanding to 28 franchises in 2001. In addition to the 25 returning teams, ten new expansion teams have been established for 2002 in the following cities: Albany, New York; Bakersfield, California; Fayetteville, North Carolina; Fresno, California; Honolulu, Hawaii; Mobile, Alabama; Uncasville, Connecticut; New Haven, Connecticut; San Diego, California; and Wilkes Barre, Pennsylvania. The Bakersfield franchise will play its games at Centennial Garden in 2002. Table IV-7 lists the franchises and their respective arenas for the 2002 season:

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Table IV-7 Arena Football 2 Seating Franchise City Arena Capacity 1

Albany Conquest * Albany,NY Pepsi Arena 17,500 Arkansas Twisters North Little Rock, AR Alltel Arena 16,500 Augusta Stallions Augusta, GA Augusta Richmond County Civic Center 8,370 Bakersfield Blitz * Bakersfield, CA Centennial Garden 10,400 Birmingham Steeldogs Birmingham, AL Birmingham - Jefferson Convention Center 19,000 Bossier City Battle Wings Bossier City, LA CenturyTel Arena 14,000 Cape Fear Wild Cats * Fayetteville, NC Cumberland County Crown Coliseum 13,500 Carolina Rhinos Greenville, SC Bi-Lo Center 16,000 Charleston Swamp Foxes North Charleston, SC North Charleston Coliseum 14,500 Columbus Wardogs Columbus, GA Columbus Civic Center 10,000 Florida Firecats Estero, FL TECO Arena 7,500 Fresno Frenzy * Fresno, CA Selland Arena 11,300 Greensboro Prowlers Greensboro, NC Greensboro Coliseum 23,830 Hawaiin Islanders * Honolulu, HI Neal S. Blaisdell Center Arena 8,730 Jacksonville Tomcats Jacksonville, FL Veterans Memorial Center 10,300 Lincoln Lightning Lincoln, NE "Thunderdome" at Pershing Auditorium 7,150 Louisville Fire Louisville, KY Freedom Hall 19,800 Macon Knights Macon, GA Macon Coliseum 9,280 Memphis Xplorers Southaven, MS De Soto Civic Center 10,000 Mobile Wizards * Mobile, AL Mobile Civic Center 10,680 Mohegan Wolves * Uncasville, CT Mohegan Sun Arena 10,000 New Haven Ninj as * New Haven, CT New Haven Coliseum 11, 170 Norfolk Nighthawks Norfolk, VA Scope Arena 13,300 Pensacola Barracudas Pensacola, FL Pensacola Civic Center 9,450 Peoria Pirates Peoria, IL Peoria Civic Center 12, 150 Quad City Steamwheelers Moline, IL The Mark of the Quad Cities 12,200 Richmond Speed Richmond, VA Richmond Coliseum - Arena 13,550 Roanoke Steam Roanoke, VA Roanoke Civic Center 11,000 Rochester Brigade Rochester, NY Blue Cross Arena at the War Memorial 14,000 San Diego AF2 Expansion Team* San Diego, CA TBA -- Tallahassee Thunder Tallahassee, FL Leon County Civic Center 14,000 Tennessee Valley Vipers Huntsville, AL Von Braun Center 8,740 Tulsa Talons Tulsa, OK Tulsa Convention Center 9,140 Wichita Stealth Valley City, KS Kansas Coliseum 11,740 Wilkes Barre/Scranton Pioneers * Wilkes Barre, PA First Union Arena at Casey Plaza 10,500

Sources: Arena Football 2, AudArena Stadmm Gmde (2002), and Economics Research Associates. Note: (*) New expansion teams for the 2002 season. (1) Total capacity including permanent and portable seating.

National Indoor Football League The National Indoor Football League (NIFL)is a similar league to the AF2. The NIFL was founded in 2001 with 18 franchises. After the Indoor Professional Football League (IPFL) ceased its operations in 2001, the Omaha Beef, the River City Renegades, and the Tennessee Thundercats of the formerIPFL has joined the new NIFL. According to league representatives, the NIFLwill expand to approximately 27 to 29 franchises forthe upcoming 2002 season. Table IV-8 illustrates the 25 committed NIFLfranc hises forthe 2002 season and their respective arenas.

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Table IV-8 National Indoor Football League I Seating I Franchise City Arena Capacity 1

Austin Franchise - TBA Austin, TX Travis County Expo Center 9,500 Billings Outlaws Billings, MT MetraPark Arena 11,750 Bismarck Roughriders Bismarck, ND Bismarck Civic Center 10,140 Boise Stallions Boise, ID Bank of America Centre 5,500 Houma Bayou Bucks Houma, LA Houma-Terrebonne Civic Center 5,000 Knoxville Thundercats Knoxville, TN Knoxville Civic Coliseum 7,250 La Crosse Night Train La Crosse, WI La Crosse Center 8,000 Lake Charles Landsharks Lake Charles, LA Lake Charles Civic Center 8,000 Louisiana Bayou Beast Monroe, LA Monroe Civic Center 7,000 Louisiana Ranges Alexandria, LA Alexandria Riverfront Center 6,000 Mississippi Fire Dogs Biloxi, MS Mississippi Coast Coliseum 11,500 Ohio Valley Greyhounds Wheeling, WV Wheeling Civic Center 7,600 Oklahoma Crude Enid, OK Chisolm Trail Expo Center 6,000 Omaha Beef Omaha, NE Omaha Civic Center 9,700 Oregon Heat Central Point, OR Jackson County Expo 4,500 Rapid City Red Dogs Rapid City, SD Rushmore Plaza Civic Center 10,000 River Cities Locomotives Huntington, WV Huntington Civic Center 8,500 River City Renegades St Charles, MO Family Arena 12,000 Sioux City Bandits Sioux City, IA Sioux City Auditorium 6,000 Sioux Falls Storm Sioux Falls, SD Sioux Falls Convention Arena Center 8,000

Trenton Lightenings Trenton, NJ Sovereign Bank Arena 10,500 Tri Cities Diesel Kearney, NE Tri City Arena 4,500 Tupelo Fireants Tupelo, MS BancorpSouth Center 10,000 Wasatsch Wolverines West Valley City, UT The "E" Center 10,500 Winton-Salem Energy Winston-Salem Lawrence Joel Veterans Memorial Coliseum 15,000

Wyoming Cavalry Casper, WY Casper Events Center 10,450 I Yakima Shockwave I Yakima, WA I Yakima Valley Dome 8, 100 Sources: International Professional Football League, AudArena Stadium Guide (2002), and Economics Research Associates. Note: (1) Total capacity including permanent and portable seating. In addition to the franchises listed in Table IV-8, the NIFL is considering the following prospective franchises for either the upcoming 2002 season or 2003 season:

• Erie, Pennsylvania • Wichita Falls, Kansas • Binghamton, New York • Lexington, Kentucky • Salt Lake City, Utah

Major Indoor Soccer League In 2001, the National Professional Soccer League (NPSL) reorganized into the new Major Indoor Soccer League (MISL) with seven NPSL franchises. Established in 1984 with six franchises, the NPSL became the major league of professional indoor soccer in North America, with teams in the United States and Canada. The following NPSL teams joined the current

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MISL: Baltimore Blast; Cleveland Crunch; Detroit Rockers; Harrisburg Heat; Milwaukee Wave; Philadelphia Kixx; and Toronto Thunderhawks.

In December 2001, the MISL agreed to merge with the four-year World Indoor Soccer League (WISL) to form a single entity under the MISL banner beginning with the 2002-03 season. The WISL began after the Continental Indoor Soccer League (CISL) ceased its operation with four ofthe CISL franchises. The WISL had six franchises during the 2000-01 season and averaged nearly 5,000 paid attendees per game with an average ticket price of $10.00. The new MISL season will consist of 36 games (18 home and 18 road), operating from late September through late March, when many arenas have open dates.

Table IV-9 lists the current MISL franchises and their respective arenas forthe upcoming 2002-03 season. According to the league, the Dallas Sidekicks, the San Diego Chargers, and the St. Louis Steamers will take part of the new MISL, of which they were once members. Note that inclusion of the Sacramento Knights, the Utah Freezz, the Detroit Rockers, and the Toronto Thunderhawks are still undecided to date.

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Table IV-9 Major Indoor Soccer League Franchises and Arenas Seating Franchise City Arena Capacity 1

World Indoor Soccer League (WISL) Dallas Sidekicks Dallas, TX Reunion Arena 18,187 Sacramento Knights - TBA Sacramento, CA ARCO Arena 17,317 Utah Freezz - TBA West Valley, UT "E" Center 13,000 St. Louis Streamers St. Charles, MO Family Arena 10,000 San Diego Sockers San Diego, CA San Diego Sports Arena 13,100

Major Indoor Soccer League (MISL) Philadelphia Kixx Philadelphia, PA First Union Spectrum 19,000 Baltimore Blast Baltimore, MD Baltimore Arena 14,000 Harrisburg Heat Harrisburg, PA Farm Show Arena 9,800 Cleveland Crunch Cleveland, OH CSU Convocation Center 15,500 Milwaukee Wave Milwaukee, WI The Bradley Center 20,000 Kansas City Comets Kansas City, MO Kemper Arena 19,500 Detroit Rockers - TBA Plymouth, MI Compuware Sports Arena 3,600 Toronto Thunderhawks - TBA Mississauga, Canada The Hershey Center 5,200

Sources: World Indoor Soccer League, and Economics Research Associates. Note: (1) Total capacity including permanent and portable seating.

CONCERT AND OTHER VENUE EVENT DATA Table IV-10 illustrates a listing of selected recent concerts drawing between 4,000 to 10,000 in total attendance. The table shows the lead performers, reported attendance, range of ticket prices, promoter, and venue. A majority of these listed concerts generate gross ticket sales of from $100,000 to $300,000, an appropriate range for the proposed arena and market conditions. Note that approximately 50 percent of the concerts are reported as sellouts, which is a common objective of concert and other event promoters, because the expectation of a sellout accelerates ticket sales, and also provides a more intense and enjoyable performance experience. Many of the summertime concerts are in amphitheaters and other outdoor venues, while events in other seasons are typically at indoor arenas more comparable to the proposed arena in Fresno.

Table IV-11 provides a selected listing of other venue events, including World Wrestling Federation events, family shows, and ice shows.

Economics Research Associates California StateUn iversity, F resnoAss ociation,I nc. ERA No. 14042 Page IV-2 0 Table IV-10 Selected Mid-Size Concerts

1 MM/YY Act Total Attendance Price - US $ Promoter Venue, Location

Jan-01 Stevie Wonder's House Full of Toys 9,705 $250; $35 N ederlander Organization/Taxi Productiorn Great WesternForum, Inglewood (CA) Jan-01 Anger Management Tour: Limp Bizkit, DMX 10,230 $42.50 Belkin Productiorn/SFXMrnic Group Schotterntein Center, Ohio State Univ ersity, Colwnbus (OH) Jan-01 Dixie Chicks, Joe Ely * 9,872 $37.00 Jam Productiorn/ Glenn Smith Presents Reed Arem, Texas A&M Univ ersity, College Station (TX) Jan-01 Whiplash Bash 2001 10,367 $45; $39.50 Palace Sports & Entertainment/SFX/BlekinProductiorn Palace of AuburnHills, AuburnHills (MI) Jan-01 Paul Winter's 21st Annual Winter Solstice 9,317 $65; $28 Paul Winter Consort Inc Cathedral of St. John the Divine, New York (NY) Jan-01 Cash Money Milliomirs, TK Kirkland, Nelly 6,943 $44; $39 Haymond Entertainment Target Center, Minneapolis (MN) Jan-01 Paul Simon * 5,093 $39.00; $26.50 Belkin Productiorn Ervin JNutter Center, Wright State Univ., Dayton (OH) Jan-01 Alabama 5,173 $45; $25 West Shore EMS Hersheypark Arena, Hershey (PA) Jan-01 KROQ's Almost Acoustic Christmas * 10,085 $48.50 House of Blues Concerts Universal Amphitheatre, Universal City (CA) Jan-01 Creed, Sevendust, Finger Eleven * 12,080 $36.50 SFX Music Group Phillips Arena, Atlanta (GA)

Jan-01 Mannheim Steamroller 7,797 $98; $21 SFX Music Group MCI Center, Washington (D.C.) Jan-01 The Tragically Hip 9,294 $24.50 Metropolitan Entertainment Group HSBC Arena, Buffalo (NY) Jan-01 The Beat Holiday Cooldown * 5,196 $98.50; $28.50 House of Blues Concerts Universal Amphitheatre, Universal City (CA) Jan-01 The Offspring, Cypress Hill, MxPx 4,621 $30.00 IM P Patriot Center, George Mason University,Fairf ax (VA) Jan-01 Marilyn Manson 4,369 $29.50 House of Blues Concerts Mercer Arena, Seattle (WA) Jan-01 Journey, REO Speedwagon * 8,617 $100; $25 Evening Star Productiorn Mandalay Bay Resort Casino Events Center, Las Vegas (NV) Jan-01 Journey, REO Speedwagon 5,459 $107.50; $26.90 Evening Star Productiorn America West Arena, Phoenix (AZ) Jan-01 Kenny Rogers Christmas from the Heart 4,093 $34; $29 F antasma Productions Van Andel Arena, Grand Rapids (MI) Jan-01 Mannheim Steamroller 9,649 $72; $21 Concerts West Phillips Arena, Atlanta (GA) Feb-01 Van Morrison, Lonnie Brooks, Linda Gail Lewis * 8,804 $75; $50 SFX Music Group Rosemont Theatre, Rosemont (IL) Feb-OJ Alabama, Savana 7 ,561 $33; $16 SFX Music Group MARS Amphitheatre, West Palm Beach (FL)

Feb-OJ Sting, Sophie B. Hawkins * 6,723 $59.75 F antasma Productions Teco Arena, Fort Meyers (FL) Feb-OJ Sting, Evan & Jaron 6,915 $58.75; $48.75 F antasma Productions Pensacola Civic Center, Pensacola (FL) Feb-OJ Styx & REO Speedwagon * 7 ,917 $35.00 Beaver Productions The Mark of the Quad Cities, Moline (IL) Feb-OJ Kid Rock, Fuel, and Buckcherry 10,218 $27.00 SFX Music Group Kentucky Fair & Expo Center, Louisville (KY) Feb-OJ Styx & REO Speedwagon * 6,697 $35.50 Beaver Productions Kansas Coliseum, Valley Center (KS) Feb-OJ Styx & REO Speedwagon 13,374 $37.75; $18.75 SFX Music Group MARS Music Amphitheatre, WestPahn Beach (FL) Feb-OJ Kid Rock, Fuel, and Buckcherry 7 ,067 $27; $1350 SFX Music Group Nationwide Arem, Columbus (OH) Feb-OJ A Perfect Circle 5,468 $25.00 Monqui Presents Mercer Arena, Seattle (WA)

Feb-OJ Sting, Sophie B. Hawkins * 6,723 $59.75 F antasma Productions Teco Arena, Fort Meyers (FL) Feb-OJ Sting, Evan & Jaron * 6,915 $58.75; $34.75 F antasma Productions Veterans Memorial Colisewn, Jacksonville (FL) Feb-OJ Alan Jackson, Sara Evans 9,048 $40.00 Varnell Enterprises Mellon Arem, Pittsburgh (PA)

Feb-OJ Sting, Sophie B. Hawkins * 6,015 $59.75; $34.75 F antasma Productions Stephan C O'Connell Center, University of Florida, Gainsville (FL) Feb-OJ Styx & REO Speedwagon * 6,997 $35.50 Beaver Productions Kansas Coliseum, Valley Center (KS) Feb-OJ Kid Rock, Fuel, and Buckcherry * 8,562 $37.00 Beaver Productions Llyod Noble Center, Un iversity of Oklahoma, Norman (OK) Feb-OJ Origiml New York Doo Wopp Show * 5,867 $45; $25 Radio City Entertainment Radro City Music Hall,New York (NY) Feb-OJ Marilyn Manson, Godhead * 5,817 $32.50 House of Blues Concerts Universal Amphitheatre, Universal City (CA) Feb-OJ Pantera, Soulfly, Morbid Angel * 5,719 $30.00 House of Blues Concerts Universal Amphitheatre, Universal City (CA) Feb-OJ Pantera, Soulfly, Morbid Ang el, Notliingface 5,319 $30.00 Double Tee Promotions Mercer Arena, Seattle (WA) Feb-OJ Hank Williams Jr., The Kentucky Headhunters 4,616 $29.75 F antasma Productions Ice Palace, Tampa (FL) Mar-01 Don Henley, Jill Sobule * 4,615 $77; $37 SFX Music Group Fox Theatre, Atlanta (GA) Mar-01 Alan Jackson, Lee Ann Womack 8,134 $45; $35 Metropolitan Entertainment Group HSBC Arena, Buffalo (NY) Mar-01 Barenaked Ladies, Chantal Kreviazuk 10,948 $35; $25 SFX Music Group Blue Cross Arena, Rochester (NY) Mar-01 70's Soul Jam 4,573 $50; $35 SFX Music Group Beacon Theatre, New York (NY) Mar-01 Pantera, Soulfly, Morbid Angel * 6,290 $31.50; $29.50 Jam Productions US Cellular Center, Cedar Rapids (IA) Mar-01 Kid Rock, Fuel, Buckcherry 6,720 $27.50 SFX Music Group Saginaw Civic Center, Saginaw (Jv.II) Mar-01 Barenaked Ladies, Chantal Kreviazuk * 5,769 $35; $27.50 SFX Music Group Stuart C Siegel Center, Richinond (VA) Mar-01 Jill Scott * 5,000 $30.50 SFX Music Group The Tabernacle, Atlanta (GA) Mar-01 A Perfect Circle * 6,221 $27.50; $25 SFX Music Group Will Rogers Memorial Center, Fort Worth (TX) Mar-01 Sarah Brightman * 5,520 $150; $50 F antasma Productions Aladdin Theatre, Las Vegas (NV)

Mar-01 Erykah Badu, Talib Kweli, Musiq * 7,001 $57.50; $37.50 Jam Productions Auditorium Theatre, Chicago (IL) Mar-01 Brooks & Dunn, Eric Heatherly 9,545 $39.50; $25 New Park Entertainment Mark Etess Arena, Trump Taj Mahal , Atlantic City (NJ) Mar-01 Don Henley, Jill Sobule * 4,561 $78; $38 Jam Productions NorthropMemorial Auditoriwn, Univ. of Minnesota, Minneapolis (JvIN) Mar-01 Alan Jackson, Sara Evan<:: 5,877 $40; $27 Jack Ut<:: ick Presents Augusta Civic Center, Augrnta (JvIE) Mar-01 Valentine's Love Jam 6,023 $39.50; $27 House of Blues Concerts Universal Amphitheatre, Universal City (CA) Table IV-10 (cont.) Selected Mid-Size Concerts

1 MM/YY Act Total Attendance Price - US $ Promoter Venue, Location

Apr-01 Julio Iglesias * 8,895 $70; $40 NYK Productions James L Knight Center, Miami (FL) Apr-01 AC/DC,Wide Mouth Mason 9,587 $45; $35 Beaver Productions Alltel Arem, North Little Rock (AR) Apr-01 Pantera, Soulfly, Morbid Ang el, Nothingface * 10,394 $40; $35 Metropolitan Entertainment Group HSBC Arena, Buffalo (NY) Apr-01 Alan Jackson * 10,562 $38.50; $27.50 New Park Entertainment Mark Etess Arena, Trump Taj Mahal , Atlantic City (NJ) Apr-01 matchbox twenty, Everclear, Lifehorne 9,600 $35; $29.50 Metropolitan Entertainment Group HSBC Arena, Buffalo (NY) Apr-01 matchbox twenty, Everclear, Lifehouse * 8,126 $36.25 Metropolitan Entertainment Group First Union Arem, Wilkes-Barre (PA) Apr-01 matchbox twenty, Everclear, Lifehouse * 8,193 $33.50; $28.50 Jam Productions The Mark of the Quad Cities, Moline (IL) Apr-01 matchbox twenty, Everclear, Lifehouse * 7 ,981 $29.00 Beaver Productions Kansas Coliseum, Valley Center (KS) Apr-01 BarenakedLadies, Chantal Kreviazuk 7,236 $35; $30 SFX Music Group Pepsi Arena, Albany (NY) Apr-01 Alan Jackson, Trick Pony 5,828 $37.50; $27.50 New Park Entertainment/Metropolitan Ent. Group Hersheypark Arena, Hershey (PA) Apr-01 Destiny's Child, Stacie Orrico, True Vibe, PYT 5,596 $34.50; $27.50 Police Productions Pershing Auditorium, Lincoln (NE) Apr-01 BarenakedLadies, Chantal Kreviazuk 5,358 $35; $30 House of Blues Concert<::/Andrew Hewitt/Bill Silva Presents Mandalay Bay Resort Casino Events Center, Las Vegas (NV) Apr-01 Outkast, Xzibit, Ludacris * 4,452 $32.50 House of Blues Concerts/ CD Enterprises Open Air Theatre, San Diego (CA)

Apr-01 Don Henley, John Hiatt and the Nashville Queens ' 8,864 $86; $30 N ederlander Organization Staples Center, Los Angeles (CA) Apr-01 Sarah Brightman 5,857 $103; $38 Metropolitan Entertainment Group Radio CityMusic Hall, New York (NY) Apr-01 AC/DC, WideMouth Mason * 10,356 $45; $35 C&C Concerts Bi-Lo Center, Greenville (SC) Apr-01 AC/DC, WideMouth Mason 11,431 $45; $35 SFX Music Group TD Waterhouse Centre, Orlando (FL) Apr-01 Destiny's Child 7,7 49 $30.00 In-home The Mark of the Quad Cities, Moline (IL) May-01 AC/DC, Wide Mouth Mason * 10,520 $45.00 United Concert<:: E Center of West Valley City, West Valley City (UT) May-01 Prince * 6,566 $85; $35 Horne of Blues Concert Magness Arena, University of Denver, Denver (CO) May-01 David Gray, Shea Seger * 11,550 $35; $20 Radio CityEntertainment/ SFX Music Group Radio CityMusic Hall, New York (NY) May-01 Alejandro Sanz * 5,957 $75; $45 Radio City Entertainment/Cardenas/Fernandez & Associates Radio City Music Hall,New York (NY) May-01 Van Morrison * 6,565 $75; $38.50 SFX Music Group Paul E. Tsongas Arem, Lowell (MA) May-01 matchbox twenty, Everclear, Lifehouse * 7,124 $38.50 Metropolitan Entertainment Group/SFX Music Group Sovereign Bank Arena, Trenton (NJ) May-01 Prince, Milenia, Fonky Bald Heads 4,764 $75; $45 In-home E Center of West Valley City, West Valley City (UT) May-01 Outkast, Ludacris 4,826 $30.00 United Concert<:: E Center of West Valley City, West Valley City (UT) May-01 Eric Clapton, Doyle Bramhall II 10,061 $75; $50 Beaver Productions Compaq Center, Houston (TX) May-01 Bon Jovi, SR-71 11,805 $65; $29.50 SFX Mrnic Group/Belkin Productions Van Andel Arena, Grand Rapids (MI) May-01 AC/DC, Buckcherry 10,397 $66; $35 Magic City Productions Pepsi Arena, Albany (NY) May-01 Alejandro Sanz 5,793 $52; $32 House of Blues Concerts Cox Arem, San Diego ( CA) May-01 Lil' Bow Wow * 8,177 $27.50 Jam Productions Arie Crown Theatre, Chicago (IL) May-01 Festival Argentina en Miami 4,868 $11 .25; $9.25 Emique Kogan AT&T Amphitheater at BayfrontPark, Miami (FL) Jun-01 Sting 8,208 $77; $47 SFX Music Group Phillips Arena, Atlanta (GA) Jun-01 AC/DC, Wide Mouth Mason 11,262 $45; $35 SFX Music Group Kohl Center Stadiwn, University of Nevada-Las Vegas (NV) Jun-01 Bon Jovi, SR-71 * 11,541 $45; $35 SFX Music Group Bi-Lo Center, Greenville (SC)

Jun-01 Sting, Dominic Miller 7,173 $65; $45 SFX Music Group The Mark of the Quad Cities, Moline (IL) Jun-01 Sting, Jill Scott 5,965 $66.25; $5125 Metropolitan Entertainment Group First Union Arem, Wilkes-Barre (PA) Jun-01 Sting, Jill Scott 7,241 $65; $35 SFX Music Group Kohl Center Stadiwn, University of Nevada-Las Vegas (NV) Ilm-01 Tom Petty & the Heartbreakers * 8,814 $67.50; $32.50 N ederlander Organization Santa Barbara County Bowl, Santa Barbara (CA) Jun-01 Rod Stewart 7,266 $100.50; $35.50 SFX Music Group Key Arena, Seattle (WA) Ilm-01 Haitian Campas Festival 6,497 $21; $6 Noel and Cecibon Productions AT&T Amphitheater at BayfrontPark, Miami (FL) Jun-01 Daryl Hall & John Oates, Chris Zito 10,683 $28.50; $16.50 Palace Sports & Entertainment Inc DTE Energy Music Center, Clarkson (MI) Jun-01 Styx & Bad Company, Bill Squier, Joe Stark 9,075 $70; $25 House of Blues Concerts Universal Amphitheatre, Universal City (CA) Jun-01 Sting, Jill Scott 6,630 $60; $40 Metropolitan Entertainment Group Blue Cross Arena, Rochester (NY) Jun-01 Brooks & Dunn, Toby Keith, Montgomery Gentry 5,222 $77; $32 House of Blues Concerts Coors Amphitheatre, Chula Vista (CA) Ilm-01 Ben Harper & the Innocent Criminals * 10,500 $30.50; $27.50 N ederlander Organization RIMAC Field, Univ ersity of California SanDiego, San Diego (CA) Ilm-01 The Black Crowes & Oasis, Spacehog 6,130 $45; $13.75 House of Blues Concerts Blossom Music Center, Cuyahoga Falls (OH) Jun-01 70's Soul Jam 5,977 $59.50; $20 House of Blues Concerts Universal Amphitheatre, Universal City (CA) Jun-01 Styx & Bad Company, Bill Squier, Joe Stark 7,812 $57.50; $9.25 House of Blues Concerts SmirnoffMusic Centre, Dallas (TX) Jun-01 David Gray, Nelly Furtado * 5,787 $35; $25 House of Blues Concerts Universal Amphitheatre, Universal City (CA) Jun-01 Backstreet Boys, Krystal, Shaggy 10,421 $95; $38.50 SFX Music Group TD Waterhouse Centre, Orlando (FL) Jun-01 Rod Stewart 10,419 $132; $37 SFX Music Group Verizon Wireless Amphitheatre, Irvine (CA) Jun-01 Backstreet Boys, Krystal, Shaggy 8,855 $58; $49.50 SFX Music Group Bi-Lo Center, Greenville (SC) Jun-01 Brooks & Dunn, Toby Keith, Montgomery Gentry 9,701 $52; $12.50 SFX Music Group Verizon Wireless Amphitheatre, Charlotte (NC) Table IV-10 (cont.) Selected Mid-Size Concerts

1 MM/YY Act Total Attendance Price - US $ Promoter Venue, Location

Jul-01 Gipsy Kings 10,513 $75; $29.50 SFX Music Group Radio CityMusic Hall, New York (NY) Jul-01 Backstreet Boys, Krystal, Shaggy 9,576 $85; $49.50 SFX Music Group Raleigh Entertainment and Sports Arem, Raleigh (NC) Jul-01 Backstreet Boys, Krystal, Shaggy 9,242 $85; $49.50 SFX Music Group Greernboro Colisewn, Greensboro (NC) Jul-01 Tom Petty & the Heartbreakers 4,350 $200; $100 Andrew Hewitt; Bill Silva Presents Hard Rock Hotel, Las Vegas (NV) Jul-01 Rod Stewart 7,870 $128.25; $38.25 SFX Music Group San Diego Sports Arena, San Diego (CA) Jul-01 Rod Stewart 8,066 $86.85; $18 SFX Music Group Sacramento Valley Amphitheatre, Marysville (CA) Jul-01 Rod Stewart 10,399 $88.75; $23.75 SFX Music Group Journal Pavillion,Albuquerque (NM) Jul-01 Backstreet Boys, Krystal, Shaggy 8,996 $124.50; $38.50 SFX Music Group Phillips Arena, Atlanta (GA) Jul-01 Rod Stewart 8,871 $1 25; $29.50 SFX Music Group Cynthia Woods Mitchell Pavillion, The Woodlands (TX) Jul-01 Depeche Mode, Poe 11,804 $51.50; $25 SFX Music Group DTE Energy Music Center, Clarkson (MI) Jul-01 Rod Stewart 6,699 $8128; $45.19 SFX Music Group General Motors Place, Vancouver (BC) Jul-01 Rod Stewart 9,086 $102.25; $35.25 SFX Music Group!ln-house America West Arena, Phoenix (AZ) Jul-01 Rod Stewart 9,883 $102.25; $24.24 Clear Channel Entertainment MARS Music Amphitheatre, WestPahn Beach (FL) Jul-01 R. Kelly, Sllllshine Anderson, Syleena Johrnmn * 8,935 $53.50; $33.50 Atlanta Worldwide Touring Fox Theatre, Atlanta (GA) Jul-01 Ricardo Arjona 5,849 $68.50; $43.50 House of Blues Concerts Universal Amphitheatre, Universal City (CA) Jul-01 Jowney, Peter Frampton, John Waite 6,701 $48.50 Clear Channel Entertainment Chastain Park Amphitheatre, Atlanta (GA) Jul-01 Brooks & Dunn, Toby Keith, Montgomery Gentry 7,621 $38.00 Clear Channel Entertainment Alltel Arem, North Little Rock (AR) Jul-01 Chicago * 6,701 $45.50; $33.50 Clear Channel Entertainment Chastain Park Amphitheatre, Atlanta (GA) Jul-01 Paulina Rubio 4,661 $104; $54 House of Blues Concert<::/Hauser/CIE Entertainment Universal Amphitheatre, Universal City (CA) Jul-01 Styx & Bad Company, Joe Stark 8,654 $46.25; $11 Clear Channel Entertainment PNC Bank Arts Center, Hohndel (NJ)

Aug-01 Eric Clapton, Doyle Bramhall II & Smokestack * 10,610 $75; $50 Beaver Productions The Mark of the Quad Cities, Moline (IL)

Aug-01 Rod Stewart 7,328 $89.75; $39.75 Clear Channel Entertainment Van Andel Arena, Grand Rapids (MI)

Aug-01 Tim McGraw, Kenny Chesney, Mark Collie 8,176 $59.50; $39.50 Magic City Productions Pepsi Arena, Albany (NY)

Aug-01 Vicente Fernandez & Alejandro Fernandez 9,241 $72.50; $24.50 House of Blues Concerts Coors Amphitheatre, Chula Vista (CA)

Aug-01 Brooks & Dunn, Toby Keith, Montgomery Gentry 8,525 $52; $27 House of Blues Concerts Blossum Music Center, Cuyahoga Falls (OH)

Aug-01 Tim McGraw, Kenny Chesney, Mark Collie 7,224 $62.50; $27.50 House of Blues Concerts Coors Amphitheatre, Chula Vista (CA)

Aug-01 Rod Stewart 5,261 $1 02.50; $9.75 Clear Channel Entertainment Sandstone Amphitheatre, Bonner Springs (KS)

Aug-01 Depeche Mode, Poe 7,678 $45.00 United Concert<:: E Center of West Valley, West Valley (UT)

Aug-01 Area: One Mrnic Festival 8,894 $58; $40.50 House of Blues Concerts HiFi Buys Amphitheatre, Atlanta (GA)

Aug-01 R. Kelly, Sllllshine Anderson, Syleena Johrnmn * 10,742 $55; $35 Radio City Entertainment/AtlantaWorldwide Touring The Theatre at Madison Square Garden, New York (NY)

Aug-01 Girls' Night Out 7,442 $1 15; $43.50 N edelander Organization Staples Center, Los Angeles (CA)

Aug-01 James Taylor 10,581 $43.75; $33.75 Clear Channel Entertainment Hersheypark Stadium, Hershey (PA)

Aug-01 King's Fest 9,587 $63.99; $23.99 Jam Productiorn/Paramount's Kings Dominion Parammmt's Kings Dominion, Doswell (VA)

Aug-01 Depeche Mode, Poe 9,237 $59.75; $35.25 F antasma Productions Natioml Car Rental Center, Sunrise (FL)

Aug-01 Paul Simon & Brian Wilson 9,561 $58; $23 Palace Sports & Entertainment/Clear Channel Entertainment DTE Energy Music Center, Clarkson (MI) Sep-01 Janet Jackson, 112 11,343 $77.50; $36.25 Clear Channel Entertainment Hartford Civic Center, Hartford (CT) Sep-01 Eric Clapton, Doyle Bramhall II & Smokestack 11,614 $65; $49.50 Concerts West Delta Center, Salt Lake City (UT) Sep-01 Aerosmith, Fuel * 12,734 $73.25; $25.50 Clear Channel Entertainment Chronicle Pavillion, Concord (CA) Sep-01 Rod Stewart 9,914 $108.75; $29.25 Clear Channel Entertainment Tweeter Center for the Performing Arts, Mansfield (1.1A) Sep-01 Eric Clapton, Doyle Bramhall II & Smockstack 8,299 $75; $45 House of Blues Concert<::/Andrew Hewitt/Bill Silva Presents Thomas & Mack Center, Las Vegas (NV) Sep-01 Sade, India, Arie 10,349 $75.25; $35.25 Clear Channel Entertainment Baltimore Arena, Baltimore (JvID) Sep-01 James Taylor * 10,810 $48; $26.50 Clear Channel Entertainment Van Andel Arena, Grand Rapids (MI) Sep-01 Stevie Nicks, Bob Schneider 11,131 $69.50; $21.50 Clear Channel Entertainment Jourml Pavilion, Albuquerque (NM) Sep-01 matchbox twenty 10,067 $42.75; $35.75 Clear Channel Entertainment Hersheypark Stadium, Hershey (PA) Sep-01 Girls' Night Out 8,239 $59.50; $29.50 Jack Ut<:: ick Presents ARCO Arena, Sacramento (CA) Sep-01 Alabama 10,081 $50; $17.50 J\1USEF mmdation Baltimore Arena, Baltimore (JvID) Sep-01 Area: One MrnicFestival 9,484 $60.90 House of Blues Concerts The Gorge, George (WA) Sep-01 Vicente Fernandez & Alejandro Fernandez 7,789 $1 00; $49.50 Cardenas/F emandez & Associates Don Haskins Center, El Paso (TX) Sep-01 John Mellencamp, The Wallflowers 9,574 $55; $39.50 Clear Channel Entertainment Hersheypark Stadium, Hershey (PA) Sep-01 Yes Symphonic Tour * 5,595 $85.50; $35.50 Radio City Entertainment/Clear Channel Entertainment Radio CityMusic Hall, New York (NY) Sep-01 The Allman Brothers Band, Susan Tedeschi 9,182 $48.25; $11 Clear Channel Entertainment PNC Bank Arts Center, Hohndel (NJ) Table IV-10 (cont.) Selected Mid-Size Concerts

1 MM/YY Act Total Attendance Price - US $ Promoter Venue, Location

Oct-01 BackstreetBoys, Krystal, Sisqo 11,891 $124.50; $38.50 Clear Channel Entertaimnent Nassau Veterans Memorial Colisewn, Uniondale (NY) Oct-01 Janet Jackson, 112 9,227 $79.75; $34.75 Clear Channel Entertaimnent Gaylord Entertaimnent Center, Nashville (TN) Oct-01 Melissa Etheridge 8,233 $75; $55 Clear Channel Entertaimnent Terrace Theatre, Long Beach (CA) Oct-01 Sade, India.Arie 9,056 $75.25; $37.25 Clear Channel Entertaimnent Pepsi Center, Denver (CO) Oct-01 MTV TRL Tour * 12,291 $60.75; $25.75 Clear Channel Entertaimnent Journal Pavillion, Albuquerque (NM) Oct-01 Maxwell, Alicia Keys 9,1 13 $55; $42 Clear Channel Entertaimnent Constitution Hall, Washington (DC) Oct-01 Maxwell, Jaguar * 8,464 $65.25; $45.25 Clear Channel Entertaimnent Great WesternForum, Inglewood (CA) Oct-01 Sade 8,468 $65.25; $45.25 Clear Channel Entertaimnent Great WesternForum, Inglewood (CA) Oct-01 Tlie Black Crowes, Beachwood Sparks 8,727 $45.00 Clear Channel Entertaimnent Beacon Theatre, New York (NY) Oct-01 Backstreet Boys, Sisqo, Krystal 6,926 $65; $35 Bravo Entertainment/Bill Silva Presents Idaho Center, Boise (ID) Oct-01 Rod Stewart 6,480 $79.75; $39.75 Clear Channel Entertaimnent CentruyTel Center, Bossier City (LA) Oct-01 Stevie Nicks 8,524 $67; $22.50 Clear Channel Entertaimnent MARS Music Amphitheatre, West Palin Beach (FL) Oct-01 Tony Bennett, k.d. lang * 11,179 $100; $35 Radio City Entertaimnent Radio CityMusic Hall, New York (NY) Oct-01 Stevie Nicks, Jolin Gregory, California 9,990 $152; $55 Clear Channel Entertaimnent Aladdin Theatre for the Performing Arts, Las Vegas (NV) Oct-01 Tool, Fantomas * 11,613 $36.50 Metropolitan Entertaimnent Group Hartford Civic Center, Hartford (CT) Oct-01 Rod Stewart 8,067 $79.25; $39.75 Clear Channel Entertaimnent United Spirit Arena, Lubbock (TX) Oct-01 Jane's Addiction, Live 6,814 $50.50 Metropolitan Entertaimnent Group Worchester's Centrwn Centre, Worchester (1.1A) Oct-01 Chicago 11,583 $66.75; $25.25 Nedelander Organization Greek Theatre, Los Angeles (CA) Oct-01 Brooks & Dunn, Toby Keith, Montgomery Gentry 9,539 $34; $29 In-home Champlain Valley Exposition, Essex Junction (VT) Oct-01 Earth, Wind & Fire, Rufus 8,469 $41.75; $21.75 Clear Channel Entertaimnent Shoreline Amphitheatre, Mmmtain View ( CA) Nov-01 Tool, Tricky * 10,198 $35.00 House of Blues Concerts Cox Arem, San Diego ( CA) Nov-01 Pledge of Allegiance 8,210 $39.50 Metropolitan Entertaimnent Group Worchester's Centrwn Centre, Worchester (1.1A) Nov-01 Jane's Addiction, Live 11,267 $46.50 Palace Sports & Entertainment/Clear Channel Entertainment Palace of Auburn Hills, AuburnHills (MI) Nov-01 Widespread Panic * 8,946 $25.00 MAJ Concerts UIC Pavillion, Chicago (IL) Nov-01 The Guess Who 4,158 $65; $25 Concerts West Key Arena, Seattle (WA) Nov-01 Pledge of Allegiance 5,818 $35.00 Jack Ut sick Present<:: /Goldenvoice Cumberland County Civic Center, Portland (ME) Nov-01 Bob Dylan 5,473 $33.50; $23.50 Jam Productions Kohl Center Arena, Madison (WI) Nov-01 Oysterhead, Drums and Tuba * 5,784 $28.75 Jam Productions Aragon Ballroom, Chicago (IL) Nov-01 Bob Dylan 3,923 $29.50 Jam Productions Bulman Center, Terre Haute (IN) Nov-01 Kenny Chesney, Phil Vassar 4,073 $28.00 Mischell Productions Allen County War Memorial Coliseum, Fort Wayne (IN) Nov-01 Music as a Weapon Tour * 4,573 $28.00 FrankProduc tions/First Artists DeltaPlex, Grand Rapids (MI) Nov-01 Alabama, Nilly Gritty Dirt Band 3,484 $30.17 Next Presentations Canada Ltd Crystal Centre, Grande Prairie (Canada) Nov-01 Backstreet Boys, Sisqo, Krystal 10,205 $124.50; $38.75 Clear Channel Entertaimnent Compaq Center, San Jose (CA) Nov-01 U2, Garbage * 11,441 $85; $45 Clear Channel Entertaimnent Joyce Center at University of Notre Dame (IN) Nov-01 Aerosmith, The Cult 11,908 $75; $30 Clear Channel Entertaimnent Hilton Coliseum, Ames (IA) Nov-01 Janet Jackson, 112 9,701 $77.75; $34.75 Clear Channel Entertaimnent Delta Center, Salt Lake City (UT) Nov-01 Elton Jolin 9,709 $85; $49.50 Clear Channel Entertaimnent Lawlor Event<:: Center, Reno (NV) Nov-01 Aerosmith 9,896 $82.1 O; $25.04 House of Blues Canada/MolsonCentre Entertaimnent Molson Centre, Montreal (Canada) Nov-01 Ozzy Osbowne, Rob Zombie, Mudvayne, Soil * 10,271 $41 Clear Channel Entertaimnent Tingley Coliseum, Albuquerque (NM) Nov-01 The Isley Brothers, Teena Marie * 6,017 $61.50; $31.50 House odf Blues Concerts Universal Amphitheatre, Universal City (CA)

Source: Amusement Busmess and ERA Note: (1) Use of asterisks (*) indicates a sold out event Table IV-11 Selected Mid-Size Events

Price - US � 1 MM/YY Act Total Attendance (High;Low) Promoter Venue, Location

Jan-01 Disney on Ice 34,438 (7 shows) $27.03; $10.34 Feld Entertainment Molson Centre, Montreal (Que.) Jan-01 WWF "Attitude" * 17,105 $40; $20 World Wrestling Federation ARCO Arena, Sacramento (CA) Jan-01 WWF "Raw is War" * 14,522 $40; $20 World Wrestling Federation San Jose Arena, San Jose ( CA) Jan-01 Blue Collar Comedy Tour 6,962 $229; $29.50 JMAC & Co./Outback Concerts Hersheypark, Hershey (PA) Jan-01 Harlem Globetrotters 13,095 $75; $12 Harlem Globetrotters International Savvis Center, St. Louis (MO)

Feb-OJ Target Stars on Ice 11,079 $55; $35 InternationalMerchandisi ng Corporation Pepsi Center, Denver (CO) Feb-OJ Mornter Trucks 15,412 (2 shows) $25; $20 SFX Motorsport<:: Pepsi Center, Denver (CO) Feb-OJ Champions on Ice 8,386 $49.50; $24.50 Champions on Ice Alltel Arem, North Little Rock (AR) Feb-OJ Barney Mrnical Castle 8,277 (2 shows) $25; $10 L yrick Productions Alltel Arem, North Little Rock (AR) Feb-OJ Paramount's Laser Spectacular 2,61 3 $26; $22 Paramount Organization Fox Theatre, Atlanta (GA) Mar-01 Queens of Comedy * 11,576 $55; $27 Latham Entertainment Radio CityMusic Hall, New York (NY) Mar-01 The Vagina Monologues 7,008 (8 shows) $47; $35 SFX Entertainment Palace Performing Arts Center, New Haven ( CT) Mar-01 Harlem Globetrotters 7,886 $75; $10 Harlem Globetrotters International Pepsi Center, Denver (CO) Mar-01 WWF "Attitude" 7,790 $35; $17 World Wrestling Federation Springfield CivicCenter, Springfield(MA) Mar-01 WWF "SMACKDOWNI " * 7,401 $45; $20 World Wrestling Federation Tucson Convention Center Arena, Tucson (AZ) Apr-01 Blue's Clues Live! 36,105 (13 shows) $29.50; $11.50 SFX Music Group Rosemont Theatre, Rosemont (IL) Apr-01 WWF "SMACKDOWNI " * 15,836 $40; $20 World Wrestling Federation Joe Louis Arena, Detroit(Jv.II) Apr-01 Disney on Ice 20,530 (8 shows) $68.50; $18.50 SFX Entertainment Pepsi Center, Denver (CO) Apr-01 Sesame Street Live 13,899 (8 shows) $16; $11 VEE Corporation Myraid Arena, Oklahoma City (OK) Apr-01 Harlem Globetrotters * 8,437 $26.25; $13.25 Harlem Globetrotters International First Union Arem, Wilkes-Barre (PA) May-01 WWF 11Backlash11 * 15,592 $200; $20 World Wrestling Federation Allstate Arem, Rosemont (IL) May-01 Primer Jaripeo Del Ano 5,926 $75; $35 Rossi Enterprises/ LatinCasino.net Thomas & Mack Center (UNL V), Las Vegas (NV) May-01 Queens of Comedy 6,444 (3 shows) $50; $40 Latham Entertainment Houston Arena Theatre, Hornton(TX) May-01 WWF "Raw is War" * 14,696 $40; $20 World Wrestling Federation Bradley Center, Milwaukee (WI) May-01 Syria Shrine Circus 19,326 (7 shows) $14.25; $8.50 Syria Temple Mellon Arem, Pittsburgh (PA) Jun-01 WWF "Raw is War" * 13,294 $51.93; $16.20 World Wrestling Federation Skyreach Centre, Edmonton (Alb.) Jun-01 WWF "Raw is War" * 13,253 $40; $18 World Wrestling Federation Target Center, Minneapolis (MN)

Jun-01 Professioml Bull Riding: Bud Light Cup 7,990 $100; $10 ProfessionalBull Riders New Orleans Arena, New Orleans (LA)

Jun-01 Ringling Brothers Barnum & Bailey Circus 28,217 (8 shows) $35; $9.50 Feld Entertainment First Union Arem, Wilkes-Barre (PA) Jun-01 WWF "Raw is War" * 9,938 $40.25; $17.25 World Wrestling Federation Richmond Coliseum, Richmond (VA) Jul-OJ Micheal Flatley's Fantasmic "Feet of Flames" * 9,288 $85; $35 Concerts West Ice Palace, Tampa (FL) Jul-OJ Micheal Flatley's Fantasmic "Feet of Flames" 9,91 8 $87; $37 Concerts West Phillips Arena, Atlanta (GA) Jul-OJ WWF 11Live! 11 8,664 $40; $16 World Wrestling Federation Natioml Car Rental Center, Sunrise (FL) Jul-OJ WWF "Attitude" 8,640 $40; $15 World Wrestling Federation Bi-Lo Center, Greenville (SC) Jul-OJ WWF "Attitude" 5,340 $35; $17 World Wrestling Federation Roanoke Civic Center, Roanoke (VA)

Aug-01 Ringling Brothers Barnum & Bailey Circus 33,457 (8 shows) $27; $10 Feld Entertainment Centennial Garden Arem, Bakersfield (CA) Aug-01 WWF "SMACKDOWNI " 10,146 $40; $17 World Wrestling Federation Mellon Arem, Pittsburgh (PA) Aug-01 Cedric "The Entertainer" 2,581 $57.50; $37.50 Celebrity Entertainment James L. Knight Center, Miami (FL) Aug-01 WWF "Attitude" 5,402 $40; $20 World Wrestling Federation Onondaga County War Memorial, Syracuse (NY) Aug-01 WWF "Raw is War" * 16,688 $45; $20 World Wrestling Federation First Union Center, Philadelphia (PA) Sep-01 Gary Payton's 2001 All Star Basketball Game 7,259 $500; $10 Gary Payton Foundation Key Arena, Seattle (WA) Sep-01 WWF "Raw is War" * 9,234 $45; $20 World Wrestling Federation Freeman Coliseum, San Antonio (TX) Sep-01 N' Sync's Challenge for the Children 5,980 (2 shows) $52; $22 Challenge forthe Children Thomas & Mack Center (UNL V), Las Vegas (NV) Sep-01 WWF "SMACKDOWNI " * 15,301 $40; $20 World Wrestling Federation Joe Louis Arena, Detroit(Jv.II) Sep-01 WWF 11Live! 11 6,863 $40; $17 World Wrestling Federation Worchester's Centrum Centre, Worchester (1.1A) Oct-01 NBA Presentation Game * 10,970 $75; $19 Detroit Pistons Van Andel Arena, Grand Rapids (MI) Oct-01 NBA Presentation Game * 8,514 $50; $25 Comcast Spectator Sovereign Bank Arena, Trenton (NJ) Oct-01 Jersey Shore Cheerleading Champiornhips * 7,155 $15.00 Jersey Shore Cheerleading Sovereign Bank Arena, Trenton (NJ) Oct-01 Blue Collar Comedy Tour 2,680 $35; $28.50 Willjam Productiorn Pepsi Arena, Albany (NY) Oct-01 Freestyle Motorcross 10,301 (2 shows) $26; $16 Clear Channel Entertainment Selland Arena, Fresno (CA)

Nov-01 Professioml Bull Riding: Bud Light Cup * 51 ,200 ( 4 shows) $161.50; $41.50 ProfessionalBull Riders Thomas & Mack Center (UNL V), Las Vegas (NV) Nov-01 Jeny Seinfeld * 17,357 ( 4 shows) $75; $45 Clear Channel Entertainment Rosemont Theatre, Rosemont (IL) Nov-01 WWF "SMACKDOWNI " 9,1 11 $40; $18 World Wrestling Federation Pepsi Arena, Albany (NY)

Nov-01 George Carlin, Dennis Blair 5,415 $55; $34 Clear Channel Entertainment Heinz Hall for the Performing Arts, Pittsburgh (PA)

Nov-01 Bill Cosby 8,988 $40; $36 Marshall University Artist Series Huntington Civic Arem, Huntington (WV)

Source: Amusement Business and ERA Note: (1) Use of asterisks (*) indicates a sold out event 01 /16;02

Section V

FINANCIAL FORECAST

The following section presents a summary of the financial analysis completed in connection with the proposed Save Mart Center. The assumptions discussed in this section reflectthe Base Case scenario, unless otherwise noted. The Base Case model utilizes assumptions developed based on our market analysis, actual pre-sales of Contractually Obligated Income (COi), discussions with the Association, Fresno business leaders, City officials, discussions with potential sports leagues, promoters, and surveys of comparable collegiate and professional arenas throughout the United States. These assumptions appear reasonable based on the current and anticipated market conditions.

It is important to note that because events and circumstances frequently do not occur as expected, there may be significant differences between the actual results and those estimated in this analysis. The projected financial performance of the Save Mart Center depends upon the continued strong support of the Fresno State athletic events by the community. The level of support could be impacted by a variety of factors including, but not limited to the following: team success; University policies toward athletics; NCAA regulations; and others.

The base-year assumptions in the cash flow are stated in 2004 dollars. Comparable data has been gathered in current dollars (when available) and have been adjusted when used in the cash flow to account for inflation. The figures reflect an annual inflation rate of 3.0 percent, unless otherwise noted.

The major determinants of a financial feasibility include:

• Potential Utilization of the Proposed Arena • Operating Revenue Assumptions • Arena Operating Expense Assumptions • Summary of Financial Results • Debt Service Coverage Ratios • Sensitivity Analyses

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Contemporary Market Conditions The terrorism attacks of September 11, 2001 in New York City and Washington DC have significantly altered the state of the United States' travel and tourism industry. At present, all sectors of the industry, ranging from airlines to hotels and ancillary services, are undergoing a severe contraction. It is unclear at this time whether this is a short-term phenomena that is likely to last for the next 12 to 18 months, or if it represents a new equilibrium or baseline from which the industry will need to recover from over the longer term.

In formulating these assumptions, ERA has looked to the past performance of comparable arenas throughout the United States. If the basic underlying structure of the industry has been altered by these events, it is likely that the results of any analysis based on past conditions will be materially different from the results eventually achieved.

POTENTIAL UTILIZATION OF THE PROPOSED ARENA The following forecasts the estimated number and type of events to be held at the proposed multi-purpose Save Mart Center, the estimated average attendance and the estimated total attendance. Utilized in the financial analysis section of this report, the assumptions are based on data from comparable arenas, data from comparable leagues, ERA' s in-house database and the results of the facility interviews.

Estimated Number and Type of Events Based on our market analysis, discussions with the Association, and the information presented above, we have forecast that the proposed Save Mart Center is anticipated to host between approximately 119 and 126 annual events in the first 5 years of operation. It should be noted that 48 of these annual events are Fresno State athletic events. Table V-1 is a summary of different event mixes at 16 selected comparable arenas.

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Table V-1 Comparable Arena Facilities Event Breakdown - (1)

Collei:;iate/Minor Leai:;ue Family Other Miscellaneous Basketball Hockey Concerts Shows Sports Events Total

0 35 20 35 5 35 130 Arena # 1 11 Arena # 2 24 0 17 13 18 83 Arena # 3 17 35 22 5 23 17 119 Arena # 4 28 40 19 14 20 25 146 Arena # 5 0 47 21 21 2811 20 137 Arena # 6 14 47 18 19 8 117 Arena # 7 30 45 12 21 15 17 140 Arena # 8 0 35 14 24 21 38 132 Arena # 9 0 45 12 26 32 25 140 Arena # 10 25 36 20 38 40 14 173 Arena # 11 21 31 9 5 3 17 86 Arena # 12 0 45 21 24 27 23 140 Arena # 13 28 35 22 40 32 22 179 Arena # 14 18 33 15 15 2 8 91 Arena # 15 38 36 14 19 12 0 119 Arena # 16 0 36 5 13 10 45 109

Average 16 36 16 20 18 20 127

Sources: Fac1htyInterviews and Economics Research Associates. Note: (1) - Data presented in latest available fiscal year. In some cases figures represent planned number or estimated number of events.

Estimated Paid Attendance Forecasts for the average paid attendance (including luxury suite seating and club-seat seating) and total attendance assumptions utilized in the cash flow model for each major event category have been made. Annual attendance at comparable arenas ranges from approximately 450,000 to nearly 1.2 million, and average approximately 720,000. Based on the assumptions detailed above, we have forecast thatthe total paid attendance at the proposed Save Mart Center will be nearly 730,000 in the firstyear of operation.

We have also forecast the percentage of complimentary tickets per event as well as the percentage of no-shows (unused paid tickets). We have concluded through our interview process that each collegiate and professional sports tenant/franchise discounts and/or distributes complimentary tickets differently ( depending on market characteristics/demand).

Table V-2 presents a summary of the forecasted number and type of events and estimated paid attendance per event for year I (2004) of the cash flow. It should be noted that certain events are not assumed to occur each year.

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Table V-2 Base Case Events and Attendance - Year 1 Number Average Paid Total Paid Event Type of Events Attendance Attendance

Anchor Sports Tenants Fresno State Men's Basketball 19 14,500 275,500 Fresno State Women's Basketball 16 800 12,800 Fresno State Women's Volleyball 13 1,000 13,000 Anchor Tenant - A 35 5,500 192,500 Anchor Tenant - B 0 0 0 Concerts Concerts - Popular 3 8,000 24,000 Concerts - Country 3 10,000 30,000 Concerts - Alternative 3 5,000 15,000 Concerts - Ethnic 4 5,000 20,000 Other Events Motorsports 1 10,000 10,000 Rodeo I Bull Riding 1 10,000 10,000 Roller Jam 1 7,500 7,500 Family Shows - A 7 4,500 31,500 Family Shows - B 4 3,500 14,000 NCAA Tournaments 0 0 0 WAC Tournaments 0 0 0 Tennis 2 5,000 10,000 International Volleyball 1 2,000 2,000 NBA Exhibitions 0 0 0 Gymnastics 0 0 0 Professional Wrestling 3 14,000 42,000 High School Championships 3 5,000 15,000 Other Miscellaneous Events 2 2,500 5,000

Totals/ Averages 121 6,031 729,800

ARENA OPERATING REVENUE ASSUMPTIONS In developing the estimated cash flow from operations, ERA has made significant assumptions related to the proposed Save Mart Center's operating revenues, including: securing a minor league sports franchise (Anchor Tenant - A), number and type of events; average attendance; average ticket prices; concessions; novelties; luxury suites; Arena Builder Seats; Personal Seat Licenses (PSL's); naming rights; private fundraising/corporate sponsorships; advertising; and a ground lease. ERA utilized information obtained from our market analysis, information provided by the Association, interviews with representatives from comparable arenas and from our internal database.

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In order to obtain information while conducting these surveys, ERA agreed to maintain the confidentiality of the participants and, as a result, cannot identify the comparable arenas in conjunction with some of their responses. A majority of the responses are from the arenas detailed in Section IV - Corrpetitive ancl Corrparables Faci lities/fenants in this analysis. Arenas and franchises providing information presented in this report are referred to as Arena A, B, C, etc. in order to conceal their identity. Thefollowing section details the key revenue-related assumptions utilized in our analysis.

Event Related Revenues Below is a listing of event related revenues which consist of tickets, concessions, novelties, parking, and a facility use fee. These revenues are a direct relationship to the number of attendees at the respective events to be performed at the Save Mart Center.

Average Ticket Prices We have evaluated historic ticket prices at Selland Arena, evaluated industry data, reviewed the Association' s estimates, and interviewed collegiate and professional sports tenants/franchises as well as event promoters. We have also surveyed several college athletic departments and minor league sports league representatives in order to estimate the average ticket price for each event in the proposed Save Mart Center. Ticket prices are illustrated in Table IV-9 (concerts) and IV-10 (mid­ size events).

Typically, collegiate and minor league sports tenants/franchises present ticket prices within their respective year books, media guides, internet web pages, etc. These ticket prices are based on full value, excluding any discounting for store coupons, season tickets, students, seniors, etc. Therefore the presented ticket prices are often an overstatement of what the individual franchises or arenas actually collect from eachpaid patron.

Based on the Fresno market area and our interviews, we have forecast the following general seating ticket prices (net of the assumed discounting) for the individual events in year I (2004) as illustrated in Table V-3 :

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Table V-3 Base Case Events and Average Ticket Prices - Year 1 Number Average Event Type of Events Ticket Price 1

Fresno State Men's Basketball 19 $20.00 Fresno State Women's Basketball 16 $5.00 Fresno State Women's Volleyball 13 $5.00 Anchor Tenant - A 35 $8.00 Anchor Tenant - B 0 $15.00 Concerts - Popular 3 $30.00 Concerts - Country 3 $28.00 Concerts - Alternative 3 $25.00 Concerts - Ethnic 4 $35.00 Motorsports 1 $15.00 Rodeo I Bull Riding 1 $15.00 Roller Jam 1 $15.00 Family Shows - A 7 $16.00 Family Shows - B 4 $14.00 NCAA Tournaments 0 $20.00 WAC Tournaments 0 $15.00 Tennis 2 $25.00 International Volley ball 1 $12.00 NBA Exhibitions 0 $30.00 Gymnastics 0 $12.00 Professional Wrestling 3 $30.00 High School Championships 3 $6.00 Other Miscellaneous Events 2 $6.00

Totals/Averages 121 NIA

Note: (1) - General Seating

Key Arena Lease Terms Throughout the industry, there are several different variations in sports leases and other event leases, ranging from a "flat" base rent level to different percentages of gate receipts. There are also variations in the different revenue sources as well as the different expenses. Based on the findings in the market analysis, conversations with the Association, conversations with local community leaders, conversations with several sports leagues, and promoters, we have forecasted the following lease terms as illustrated in Table V-4, which we believe are reasonable forpur poses of this analysis:

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Table V-4 Rental Rates (Save Mart Center Receives) Net Net Net Event Tickets/Rent Concessions Novelties

Fresno State Men's Basketball 0.0% 100.0% 0.0% Fresno State Women's Basketball 0.0% 100.0% 0.0% Fresno State Women's Volleyball 0.0% 100.0% 0.0% Anchor Tenant - A $250,000 50.0% 0.0% Anchor Tenant - B 10.0% 100.0% 0.0% Concerts - Popular 8.0% 100.0% 10.0% Concerts - Country 8.0% 100.0% 10.0% Concerts - Alternative 8.0% 100.0% 10.0% Concerts - Ethnic 8.0% 100.0% 10.0% Motorsports 6.0% 100.0% 10.0% Rodeo I Bull Riding 8.0% 100.0% 10.0% Roller Jam 8.0% 100.0% 10.0% Family Shows - A 5.0% 100.0% 0.0% Family Shows - B 8.0% 100.0% 0.0% NCAA Tournaments 10.0% 100.0% 0.0% WAC Tournaments 10.0% 100.0% 0.0% Tennis 10.0% 100.0% 10.0% International Volleyball 10.0% 100.0% 10.0% NBA Exhibitions 5.0% 100.0% 0.0% Gymnastics 10.0% 100.0% 10.0% Professional Wrestling 8.0% 100.0% 10.0% High School Championships 10.0% 100.0% 0.0% Other Miscellaneous Events 10.0% 100.0% 10.0%

Note: Anchor Tenant - A - $250,000 per season.

Based on conversations with the Association, there are current on-going negotiations with Anchor Tenant-A, in which Save Mart Center will potentially receive additional revenues once certain attendance levels are met. This attendance-based lease could potentially be a positive impact to the Save Mart Center pro forma.

Concession and Novelty Revenues Concessions and novelties are anticipated to provide a significant source of revenue at the proposed Save Mart Center. Concession and novelty spending typically increases at newer facilities due to the increased number of points-of-sale and the improved location of the concession and novelty stands throughout the arena. To develop appropriate concession and novelty per capita assumptions, we conducted facility interviews, reviewed historical industry data and utilized ERA' s internal database. Table V-5 details the gross concession per capitas from comparable facilities.

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Table V-5 Comparable Arena Concession Per Capitas Collegiate/Minor League Family Other Basketball Hockey Concerts Shows Sports

Arena #1 NIA $5.71 $6.05 $5.38 $4.70 Arena #2 $4.37 NIA $5.87 $4.70 $2.22 Arena #3 $4.13 NIA $5.11 $3.73 $1.68 Arena #4 $5.31 $5.15 $6.00 $4.24 $1.86 Arena #5 $4.53 $5.42 $3.66 $5.49 $4.47 Arena #6 NIA $4.76 $3.78 $2.22 $2.53 Arena #7 $4.60 $5.25 $4.00 $4.50 $2.50 Arena #8 NIA $4.39 $5.00 $2.50 $1.90 Arena #9 $5.85 $6.10 NIA NIA NIA

Sources: F aci Iity I ntervi ews and E conorrics Research Associates.

Based on the comparable data as well as the demographics of the proposed Save Mart Center, we have estimated average concession and novelty per capitas stated in 2004 dollars. Table V-6 details our assumptions per event.

Table V-6 Base Case Gross Concession and Novelty Per Capitas - Year 1 Per Capitas 1 1 Event Type Concessions Novelties

Fresno State Men's Basketball $6.00 $1.50 Fresno State Women's Basketball $3.00 $0.75 Fresno State Women's Volleyball $3.00 $0.75 Anchor Tenant - A $6.00 $1.50 Anchor Tenant - B $6.00 $1.50 Concerts - Popular $6.00 $7.00 Concerts - Country $6.00 $7.00 Concerts - Alternative $6.00 $7.00 Concerts - Ethnic $6.00 $7.00 Motorsports $6.00 $2.00 Rodeo I Bull Riding $6.00 $2.00 Roller Jam $6.00 $2.00 Family Shows - A $4.00 $7.00 Family Shows - B $4.00 $7.00 NCAA Tournaments $8.00 $3.00 WAC Tournaments $8.00 $3.00 Tennis $4.00 $1.00 International Volley ball $4.00 $1.00 NBA Exhibitions $6.00 $5.00 Gymnastics $6.00 $1.00 Professional Wrestling $6.00 $1.00 High School Championships $3.00 $0.75 Other Miscellaneous Events $3.00 $0.75 Note: (1) Gross prices are assumed to be net of any taxes.

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Concessions will be subj ect to cost of goods sold (COGS) and concess10n operating expenses. Based on interviews with comparable arenas and several concessionaires, concession COGS typically range from 45 percent to 65 percent of gross concession revenue. These expenses, however, vary significantly depending on the local market area, policies implemented by the facility and the strategy for concession pricing. For analytical purposes, concession expenses (including operator profit margin) are assumed to be 60 percent of gross concession sales, which are reasonable for purposes of this analysis.

Novelties will be subj ect to COGS and novelty operating expenses. Based on interviews with comparable arenas and several concessionaires, novelty COGS typically range from 65 percent to 80 percent of gross novelty revenue. For analytical purposes, novelty expenses (including operator profit margin) are assumed to be 75 percent of gross novelty sales, which are reasonable for purposes of this analysis.

Parking Revenues We have assumed for purposes ofthis analysis that the Association/arena would not have control of any of the parking revenues at the proposed Save Mart Center. We have forecast parking rates for the proposed Save Mart Center to be approximately $7.00 for a majority of events and $4.00 for other smaller events in 2004 dollars, which is competitive for current parking rates at Selland Arena. The number of persons per vehicle varies from event typeto event type.

Expenses associated with operating the parking facilities include staffing for parking attendants and security. This expense can vary significantly depending on parking rates, number of on-site parking spaces and the parking services required. For analytical purposes, parking expenses forthe proposed arena are assumed to average approximately 15 percent of gross parking revenues.

If the Association is granted any portion of the parking revenues, there would be a positive effect to the Save Mart Center pro forma.

Facility Use Fee Based on discussions with the Association, a "Facility Use Fee" will be assessed on University events at the proposed Save Mart Center. A facility use fee is a fee or( rent) taken from the gross ticket price with the revenues being awarded to the facility. Comparable venues have facility fees ranging from approximately $0.25 per to over $2.00 per ticket. Others are a percentage

Economics Research Associates California StateUn iversity, F resnoAss ociation,I nc. ERA No. 14042 Page V-9 01 /16;02 of the ticket price ranging from 1h of 1.0 percent to nearly 5.0 percent. We have applied a $0.50 facility use fee toall Fresno State athletic events, and $0.00 to all other Save Mart Center events.

Box Office We have not assumed that the box office atthe proposed Save Mart Center would charge any additional fees to the prices of the tickets sold. If the box office does charge an additional fee on the sold ticket, additional revenues could be added to the operations of the Save Mart Center.

Contractually Obligated Income ERA has assumed that a significant portion of revenues from operations will be generated from sources of COi inventory which are secured by multi-year contracts for luxury suites, Arena Builder Seats, PSL's, naming rights, private fundraising/corporate sponsorships, adverti sing, and a ground lease (adjacent to the proposed site of the Save Mart Center).

Luxury Suite Revenues Luxury suites represent an increasingly important revenue source for many anchor tenants and venues. Luxury suites offerthe potential to provide a steady, contractually guaranteed source of revenue and are typically used for corporate marketing and entertaining. Based on the results of the market analysis and a review of the building plans, the proposed Save Mart Center will include 32 luxury suites with approximately 14 seats per suite. Two of the luxury suites are for the naming rights sponsor and will generate no additional revenue.

The remaining 30 luxury suites are priced from$45,000 to $60,000 as illustrated in Table V- 7. Luxury suite prices in comparable arenas lease for an average of $20,000 to $75,000 annually (Table IV-I). Many of the arenas which include the lower priced luxury suites do not include tickets to the events, a portion include tickets to some of the events, and a portion include tickets to all of the events.

Table V-7 Save Mart Center - Lux ury Suite Prices No. of Lux ury Price 9 $60,000 13 $50,000 $45,000 Sources: Association and ERA .

Based upon our discussions with the Association, we have assumed that 30 of the available luxury suites would be leased. As of the writing of this report, 28 of the available 30 luxury suites

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have been leased at the prices listed in Table V-7. Of the 30 luxury suites that have been leased to date, Z3 are IO-year leases, one is a 7-year lease, and four are 5-year leases. We have assumed an average year I (2004) gross weighted average price of approximately $52,200 (includes weighted average percentage increases). For purposes of this analysis, we have assumed that tickets to all of the events would be included in the luxury suite price.

Deposits for these luxury suites prior to the openmg of the Save Mart Center are approximately $855,000 in 2001 and an additional $710,000 will be deposited in 2003. Total luxury suite revenues in years 2004 through 2008 are assumed to be $1.57 million per year (no annual increase). Although this analysis only forecasts five years of operations of the Save Mart Center, the Association has forecasted annual luxury suite revenue to increase by 5.0 percent every 10 years.

Arena Builder Seat Revenues The proposed Save Mart Center will offer approximately 1, 108 club seats (Arena Builder Seats). Club-seats are typically located in the best locations in the arena and are for season ticket holders. Not all of the comparable arenas offer club seating. The number of club seats range from approximately 200 to 2,000 and average prices including tickets to all or a majority of the events range from $250 to $2,000 (annually).

Arena Builder Seats constitute a license for a IO-year term to occupy a designated seat in the Arena Builder Seat areas in the Save Mart Center and vary in the number of payments. The seats are applicable for all pre-season and regular season games played by the Fresno State men's basketball team. Annually, during the term of the license agreement, the licensee is entitled to purchase at an additional cost, one season ticket for each Arena Builder Seat purchased. These seats include the right of first refusal to purchase tickets to all other events. Table V-8 provides the following Arena Builder Seat prices and respective number of payments as provided by the Association:

Table V-8 Save Mart Center - Arena Builder Seat Prices

No. of Seats No. of Seats Sold Price oer Seat Term Pavment Term 32 32 $25,000 10 years 3 years 16 16 $25,000 10 years 10 years 1,060 892 $15,000 10 years 3 years Sources: Association and ERA .

As of the writing of this report, 940 of the 1, 108 Arena Builder Seats have been leased at the listed prices. The only remaining inventory are from the $15,000 per seat category. Based on our discussions with the Association, we have assumed that all of the Arena Builder Seats will be

Economics Research Associates California StateUn iversity, F resnoAss ociation,I nc. ERA No. 14042 Page V-1 1 01 /16;02 available for lease, and have assumed that 100 percent of the Arena Builder Seats would be leased at the above listed prices prior to the opening of the Save Mart Center. To date, there are Arena Builder Seat deposits of approximately $6.96 million. We have assumed additional deposits of $4.9 million in 2002 and 2003. Total Arena Builder Seat revenues in years 2002 through 2008 are approximately $40,000 per year.

Although this analysis only forecasts revenues and expenses for the first five years of operation, the Association forecasts revenues from the renewal of these Arena Builder Seats (between 2012 - 2014) to be only $5.0 million. This $5.0 million forecast, assuming a 3.0 percent inflation rate, equates to approximately 25 percent of the pre-opening Arena Builder Seat revenues. The Association also forecaststhe second Arena Builder Seats renewal revenues (between 2022 - 2024) at the same $5.0 million.

Personal Seat Licenses PSL' s are a relatively new source of revenue for collegiate/professional sports facilities. PSL' s can be used to privately finance these facilities and minimize the reliance of public revenue sources. PSLs give patrons the right to purchase season tickets for selected seats for a defined period of time. The Association has offered approximately 11,076 seats at prices ranging from $500 to $3,000 per seat. The fees for such seats are to be prepaid prior to the opening of the Save Mart Center. The term for the license is 10 years. Similar to the Arena Builder Seats, the seats are applicable for all pre-season and regular season games played by the Fresno State men's basketball team. Annually, during the term of the license agreement, the licensee is entitled to purchase at an additional cost, one season ticket for each PSL purchased.

To date, there have been 8,495 PSL's sold with a total of approximately $3.50 million deposited. Based on our conversations with the Association and a review of documents, we have estimated that approximately one-half of the 2,581 remaining PSL's will be sold prior to the opening of the Save Mart Center. Based on the commitments in place and future sales, we have assumed approximate revenues of $4.5 million in years 2002 and 2003. Total revenues forthe PSL's equate to approximately $12.6 million.

Although this analysis only forecasts revenues and expenses for the first five years of operation, the Association forecasts revenues from the renewal of these PSL' s (between 2012 - 2014) to be only $9.0 million. This $9.0 million forecast, assuming a 3.0 percent inflation rate, equates to approximately 50 percent of the pre-opening PSL sales. The Association also forecast second PSL renewal (between 2022 - 2024) at the same $9.0 million.

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Arena Naming Rights Historically, arenas and stadiums were named after the city, county or, in some instances, to honor or memorialize a significant individual or group. Selling the naming rights of a facility to an unrelated corporation was, and can still be, a political issue, but there has been a definite trend towards the sale of naming rights to the private corporation in recent years. Naming rights have typically been sold to corporations in the following industries:

• Financial Services • Airline • Beverage • Energy • Automobile • Retail • Consumer Product • Computer • Internet • Other Several sports facilities have recently licensed the name of the facility to major corporations. We have obtained arena naming rights information fromrecently constructed (or under construction) comparables. It is often difficult to gather complete information regarding naming rights as some of the recent deals do not necessarily reflect "arms-length" transactions. For example, naming rights sold to a family or a bank may have other provisions which could result in misleading conclusions. Furthermore, some transactions include significant advertising opportunities or other amenities, thus inflating the reported price. We have attempted to adjust forthose considerations in our assumptions.

These naming rights deals in comparable arenas range from a low of $200,000 to a high of approximately $2,000,000 annually. A majority of these naming rights deals are for IO-year periods.

Naming rights licensing fees vary considerably and are typically based on the amount of media coverage the arena will receive (e.g. television, radio, print, etc.), arena attendance and prestige.

The Association has agreed to a naming rights agreement with the Bottling Group, LLC (Pepsi). ERA has reviewed the naming rights agreement and is a summarized below:

• The term commenced in December 1999 and ends the last day of the 276th month following the month in which the opening date occurs. • Pepsi agrees to pay the Association $40 million ';,- $4.0 million pre opening, less $460,000 for commission to the agency, the entity that assisted the Association with the naming rights negotiation

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';,- $1.57 million per year post-opening, less comm1ss1on of $180,000 for commission to the agency • Save Mart Supermarkets, as designated by Pepsi, is the Naming Party and "Save Mart Center" is the name of the arena • The agreement includes various signage, product availability, vending rights, advertising rights, promotional rights and sponsorship benefits • The Association and Pepsi have limited termination rights The Association has not forecasted revenues from naming rights upon expiration of the contract. Given the needs of the project to date, some of the naming rights revenues have been utilized for payment of working drawings/design documents, etc. Therefore, based on discussions with the Association, we have forecasted $1.83 million in 2001 and annual payments of approximately $1.39 million annually ($1.57 million less $180,000), beginning in 2004 through 2026.

Private Fundraising/Corporate Sponsorships ERA has reviewed the private fundraising revenues that the Association has received to date regarding the Save Mart Center. We have also reviewed the historic private fundraising efforts at Fresno State, as well as the estimated private fundraising that the Association has budgeted for the Save Mart Center. Table V-9 provides the private fundraising assumptions provided by the Association used in this analysis.

Table V-9 Private Fundraising Save Mart Center Additional Year Total Revenue Collected Committed Projected 2001 $3,303,074 $3,303,074 $0 $0 2002 $3,125,000 $0 $3,125,000 $0 2003 $423,000 $0 $423,000 $0 2004 $623,000 $0 $423,000 $200,000 2005 $523,000 $0 $323,000 $200,000 2006 $523,000 $0 $323,000 $200,000 2007 $435,000 $0 $235,000 $200,000 2008 $435,000 $0 $235,000 $200,000 Source: Association and ERA.

The Association has secured the following corporate sponsors in addition to the naming rights sponsor for the Save Mart Center, including: California Federal Bank; Pacific Bell; Community Medical Centers; IBM/CompuWare; and Kroeker (local waste reclamation/contractor). We have reviewed the contracts and have applied the revenues as follows:

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Table V-10 Corporate Sponsorships

Additional Year Revenue Collected Committed Proiected 2001 $685,424 $685,424 $0 $0 2002 $648,472 $0 $648,472 $0 2003 $594,186 $0 $594,186 $0 2004 $717,186 $0 $717,186 $0 2005 $651,986 $0 $651,986 $0 2006 $651,986 $0 $651,986 $0 2007 $419,586 $0 $3 19,586 $100,000 2008 $385,300 $0 $285,300 $100,000 Source: Associat10n and ERA.

Although this analysis only forecasts revenues and expenses for the first five years of operations, the Association has only forecasted an additional $2.87 million of private fundraising/corporate sponsorship after the first five years.

Based upon our review of the historical corporate sponsorships relating to Fresno State athletics and the revenues received to date, we believe that these estimates are achievable.

Advertising Revenues Arena advertising revenues are generated by the following sources:

• Display Advertising - Signage throughout the concourses, concession stands and other common areas in the building. • Scoreboard Advertising - Fixed signage, electronic advertising on the scoreboard and video message boards. • Basketball Advertising - Advertising on the basketball standards, basketball floor, ball carts, scorers' table and players benches. • Inner Bowl - Team/talent entrances, patron entrances, auxiliary scoreboards, etc. • Dasherboard Advertising - Signage on the hockey dasherboards. It is important to note that direct comparison of advertising revenue among arenas often includes trades and/or barter arrangements. Gross advertising revenue may be significantly higher than net advertising revenue depending on the additional benefits associated with the particular deal.

The current gross annual advertising revenues for the comparable arenas range from aproximately $500,000 to $2.25 million. The advertising revenue figures were obtained through the primary tenants, arena management and ERA' s database.

We have reviewed the Association's different advertising packages that they are offering. The Association has these different advertising options at a total value of approximately $2. 1 million.

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Based on the demographics and the number of expected events and tenant mix, and review of the Associations business plan, we have forecast that the proposed Save Mart Center would generate approximately $1,650,000 in annual advertising revenue, net of trades and barters, etc. (approximately 77 percent).

Ground Lease The Association has projected that it will enter into a ground lease for the approximate 44.7 acres on the Northeast comer of Shaw Avenue and Chestnut Avenue (adjacent to the proposed site of the Save Mart Center). Revenues from this land (owned by Fresno State) are to be pledged toward the Save Mart Center operations.

Lawrence D. Hooper, MAI, of Real Property Analysts, in Fresno, California prepared a real estate appraisal dated January 29, 2001. According to the real estate appraisal, the fair market value of the vacant land as of January 25, 2001 was approximately $9.735 million and the fairmarket value rent per year was $973,500. For purposes of this analysis, we are assuming $750,000 of revenues per year for the ground lease of this property.

Bulldog Foundation The Association and the Bulldog Foundation (BDF) have entered into a Memorandum of Understanding (MOU) to provide an additional $1.3 75 million annually as another source of revenue for the project. Under the MOU, the BDF funds will be provided to the Association as a contribution, and not as a loan. Therefore, while the Association will be obligated to repay all BDF funds contributed to the proj ect, it will not be subj ected to additional interest fees and loan charges. For purposes, of this analysis, the annual BDF contribution has been forecasted at $1.375 million.

Student Seating Revenues As of December 2001, the Trustees of the California State University (the Board) will enter into a Student Seating Purchase Agreement with the Association to purchase approximately 2,000 seats at the proposed Save Mart Center. The Board will pay a fixed annual purchase price of $300,000 for the student seats, which will be paid for by the student union fees collected from the students enrolled at the University. The student seat revenues will be another source of revenue for the project.

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Other Revenues Other revenues include senior debt service reserve fund earnmgs ($155,000 in 2004 and $23 11,000 annually thereafter) and subordinate debt service reserve fund earnings ($10,000 in 2004 and $21,000 annually thereafter).

ARENA OPERATING EXPENSE ASSUMPTIONS ERA developed forecasts regarding the operating expenses for the proposed Save Mart Center based on surveys with comparable arenas and ERA' s internal database. The following section summarizes the results of our analysis and the operating expense assumptions utilized in the cash flow model. All operating expense information related to comparable arenas are presented in 2004 dollars based on an annual inflation rate of 3.0 percent, unless otherwise noted.

Staffing Expense In order to estimate the staffing requirements and the expenses to be incurred by the proposed Save Mart Center, we surveyed comparable arenas to determine the number and positions of full-time "equivalent" employees. These arenas have full-time staffs ranging from 17 to 29, and average 24 full-time employees. Table V-11 below summarizes the number of full-time "equivalent" employees for selected comparable arenas:

Table V-11 Comparable Arenas Full- Time Employees Full-Time Arena Employees

Arena A 28 Arena B 22 Arena C 17 Arena D 25 Arena E 21 Arena F 29 Arena G 28 Arena H 18

Average 24

Sources: Fac1hty mterv1ews and ERA.

Based on a review of this information and the operating assumptions detailed in this report, we have forecast that the arena's operations will require the comparable arena average number of full-

Economics Research Associates California StateUn iversity, F resnoAss ociation,I nc. ERA No. 14042 Page V-17 01 /16;02 time "equivalent" employees. We have forecasted that the proposed Save Mart Center would require approximately 24 full-time "equivalent" employees, not including concession or parking staffing requirements. We have used the term "equivalent" only to estimate the salary and wage expenses likely to be attributed to the arena. Table V-12 illustrates the total staffing expenses for comparable arenas, escalated to 2004 dollars.

Table V-12 Comparable Arenas Staffing Expense Total Arena Arena Salaries

Arena A $1,602,476 Arena B $1,219, 187 Arena C $889, 152 Arena D $1,909,78 1 Arena E $1,338,533 Arena F $1,148,853 Arena G $703,297 Arena H $1,774,882 Arena I $1,426,073 Arena J $1,134,535

Average $1,3 14,677

Sources: Fac1hty mterv1ews and ERA.

• Total staffing expenses (including benefits) for the comparable facilities range from a low of approximately $890,000 to a high of approximately $1.9 million, with an average of approximately $1.3 million. The variance between these facilities is due to several factors, including: local wage levels; event mix and schedules and the reimbursement policies for game/event related staffing expenses. • The total wage expense (including overhead fees, but excluding benefit costs) for the proposed arena is estimated to be approximately $944,000. We have estimated that benefits and indirect staffing expenses are estimated to be approximately 25.0 percent of gross wages. Based on these estimates, the total annual staffing expense in current dollars have been forecasted to be

approximately $1.215 million. This figure is forthe arena' s operations only and does not include concession and parking staffing requirements.

• As detailed in Section 111 - Market AreaAnaly sis, the Fresno marketplace on average, has lower salaries than the national averages. Based on the marketplace, the staffing expense forecast is lower than the average than the comparables.

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Utility Expenses Utility expenses typically differ among arenas due to the number of events that the arena hosts, the local climate, and other factors. Table V-13 below details the utility expenses among comparable arenas and illustrates that these differences may be material:

Table V-13 Comparable Arenas Utility Expenses Arena Utili ties

Arena A $664,627 Arena B $244,382 Arena c $640,012 Arena D $650,277 Arena E $476,865 Arena F $439,842 Arena G $297,514 Arena H $395,028 Arena J $472,778

Average $475,703

Sources: Fac1hty mterv1ews and ERA.

Total utility expenses for the comparable arenas surveyed ranged from a low of approximately $300,000 to a high of approximately $665,000, with an average of approximately $476,000.

Due to the rising cost in utilities, the uncertainty of California utility costs in the future, the anticipated use of the arena and our review of the utility expenses of comparable arenas, we have forecasted approximately $640,000 for utility expenses in year 1, increasing approximately 3 percent per year thereafter, which ERA deems reasonable.

Event-Related Expenses Game-day and event-related expenses typically include event set-up and tear down, staffing of ushers, ticket takers, security, cleaning and other expenses directly related to the game or event. Total game-day expenses at comparable arenas with basketball or hockey tenants currently range from $2,000 to $3,000 for major tenants. Other event related expenses varied significantly among the comparable arenas depending on the unique requirements of the event. Although a majority of event related expenses are assumed to be passed through to the tenant, some of the change-over costs between concerts and events as well as certain other event-day expenses are typically not reimbursed

Economics Research Associates California StateUn iversity, F resnoAss ociation,I nc. ERA No. 14042 Page V-19 01 /16;02 as a result of rental negotiations. For analytical purposes, the non-reimbursed event related expenses are forecasted to be approximately $100,000 in year 1, increasing approximately 3 percent per year thereafter.

Management Fee As of the writing of this report, a management agreement has not been completed for management services at the Save Mart Center. According to discussions with the Association, it is our understanding that the Association will engage a professional management team in the immediate future. Not all of the comparable arenas engage a management company to operate their respective arena. Comparable arena management agreements vary depending on base fee, incentives, as well as other managed facilities owned by the same municipality/owner, etc. Base fees (excluding incentives) for the comparable arenas range from approximately $225,000 to $500,000 per year.

For purposes of this analysis, we have assumed that the Association will retain a management company. We have assumed that the base fee for this service will be approximately $400,000 per year in year 1, increasing approximately 3 percent per year thereafter.

Other Arena Operating Expenses The arena will incur other expenses as a result of general operations. These expenses include a variety of items, including: administrative; building; insurance; professional fees; among others. Based on interviews with comparable arenas, we have forecasted that other operating expenses will total approximately $1,000,000 in year 1, increasing approximately 3 percent per year thereafter.

Total Arena Operating Expenses Based on the assumptions detailed above, the total estimated annual operating expenses attributed to the proposed Save Mart Center are anticipated to be approximately $3.35 million in year 1 (2004) fluctuating to $3.78 million in year 5 (2008). As Table V-14 illustrates, this assumption appears reasonable relative to comparable arenas.

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Table V-14 Comparable Arenas Total Expenses Arena Expenses Arena A $2,912,449 Arena B $2,241,700 Arena C $2,173,951 Arena D $4,916,517 Arena E $3,082,370 Arena F $3,207,224 Arena G $2,088, 107 Arena H $3,427,203 Arena I $3,326,991 Arena J $4,372,402 Arena K $5,941,910 Arena L $3,127,022 Arena M $2,75 1,814 Average $3,351,512 Sources: Fac1hty mterv1ews and ERA.

Of the comparable facilities surveyed, the total operating expenses range from a low of approximately $2.10 million to a high of over $5.94 million, with an average of approximately $3.35 million in current dollars. The range in total arena operating expenses is due to a number of factors, the most significant being: event mix and schedule; climate; cost of living; and lease agreements. Total operating expenses are forecastedto be approximately $3.354 million in Year I (2004).

Other Expenses

Capital Replacement Reserve Capital replacement expenses vary significantly among comparable arenas and on a year-by­ year comparison. Typically, however, comparable arenas set aside annual amounts in order to fund required capital replacement expenditures. The amount set aside is generally a function of the cost of the facility. For analytical purposes, the annual payments required to fund capital replacement expenses are assumed to be 1h of one percent of the hard arena construction costs (approximately $ 8 6 million) or approximately $430,000 in year 1, increasing 3 percent per year thereafter, which are reasonable for purposes of this analysis.

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Debt Service

Based on information received fromSalomon Smith Barney,we have included the following debt service on the Senior Bonds and the Subordinate Bonds during the project' s first five operating years:

Table V-15 Debt Service Debt Sen ice (OOOs) Year Senior Subordinate

2004 5,990 415 2005 5,033 410 2006 5,167 411 2007 4,784 411 2008 4,715 411

Sources: Salomon Smith Barney. and ERA.

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SUMMARY OF FINANCIAL RESULTS The Base Case cash flow model developed for the proposed Save Mart Center utilizes estimates that were developed based on our review of the market analysis, surveys with comparable arenas, lease terms and conditions and assumptions provided by the Association. Although these estimates appear reasonable based on the current and anticipated market conditions, actual results depend on the actions of management and other factors both internal and external to the project, which frequently vary. It is important to note that because events and circumstances may not occur as expected, there may be substantial significant differences between the actual results and those estimated in this analysis.

Table V-16 is the summary forecast of the major line items in the Base Case forthe proposed Save Mart Center. Table V-17 provides a more detailed cash flow summary for the proposed Save Mart Center. The key assumptions and estimated Base Case arena cash flows are presented in detail in Appendix A

Table V-16 Summary of Base Case Cash Flow

Presented on (000' s) Years 1st 5 years of Operation 1st Major COi Renewals 2nd Major COi Renewals CASH FLOW LINE ITEMS 2004 2005 2006 2007 2008 2012 2013 2014 2022 2023 2024

TotalEvent -Related Revenues $2,350 $2,434 $2,7 10 $2,534 $2,547 $2,809 $2,920 $2,958 $3,596 $3,744 $3,790 Total Contractually Obligated Income $8,405 $8,289 $8,340 $8,073 $8,092 $12,555 $12,696 $12,338 $12,929 $13,096 $13,182 Total Operating Revenues $10,755 $10,724 $11,051 $10,607 $10,639 $15,364 $15,616 $15,296 $16,525 $16,840 $16,972 Other Revenues $165 $332 $332 $332 $332 $332 $332 $332 $332 $332 $332 Total Operating Expenses $3,354 $3,455 $3,559 $3,665 $3,775 $4,249 $4,377 $4,508 $5,71 l $5,882 $6,059

Revenues Available for Senior Debt Service $7,556 $7,580 $7,803 $7,252 $7,174 $ll,426 $ll,550 $ll,098 $11,125 $ll,269 $ll,225 Revenues Available for Total Debt Service $7,566 $7,601 $7,824 $7,273 $7,195 $ll,447 $ll,57l $11,119 $11,146 $ll,290 $ll,246 Debt Service Coverage Ratio - (Senior Debt) 2.1 l l.51 l.51 l.52 l.52 l.54 l.55 l.55 l.60 l.60 l.61 TotalDebt Service Coverage Ratio 2.00 l.40 l.40 l.40 l.40 l.47 l.47 l.47 l.51 l.52 l.52 Contractually Obligated Income Coverage Ratio 2.35 l.65 l.61 l.69 l.72 l.70 l.70 l.73 l.86 l.86 l.89

Economics Research Associates California StateUn iversity, F resnoAss ociation,I nc. ERA No. 14042 Page V-23 Table V-17 Cash Flow Summary SAVE MART CENTER - BASE CASE Fiscal Year 2001 2002 I 2003 I 2004 ! 2005 I 2006 ! 2007 I 2008 ! Number of Events 0 0 0 121 119 126 119 122 Annual Paid Attendance (000) 0 0 0 730 735 771 733 720

EVENT-RELATED REVENUES Tickets - (table3) Fresno State Athletic Events $0 $0 $0 $0 $0 $0 $0 $0 Other Anchor Tenant( s) 0 0 0 250 250 250 250 250 Concerts 0 0 0 211 107 224 113 237 Other Events 0 0 0 211 311 327 328 239 Total Ticket Revenue $0 $0 $0 $672 $667 $800 $691 $726 Concessions/Novelties/Parking - (table 6) Concessions $0 $0 $0 $1,508 $1,604 $1,737 $1,679 $1,646 Novelties 0 0 0 19 11 20 12 21 Parking 0 0 0 0 0 0 0 0 Total Concessions/Novelties/Parking Revenues $0 $0 $0 $1,527 $1,615 $1,758 $1,690 $1,667 Facility Use Fee - (table 2) $0 $0 $0 $151 $152 $152 $153 $153 Box Office - (table 2) 0 0 0 0 0 0 0 0 TOTAL EVENT-RELATED REVENUES $0 $0 $0 $2,350 $2,434 $2,710 $2,534 $2,547

CONTRACTUALLY OBLIGATED INCOME Luxury Suites - (table4) $855 $0 $710 $1,565 $1,565 $1,565 $1,565 $1,565 Arena Builder Seats (3 year payments) - (table 4) 6,960 4,870 4,870 0 0 0 0 0 Arena Builder Seats (10 year payments) - (table 4) 0 40 40 40 40 40 40 40 Personal Seat Licenses - (table 4) 3,489 4,542 4,542 0 0 0 0 0 Naming Rights - (table 4) 1,829 0 0 1,385 1,385 1,385 1,385 1,385 0 Private Fundraising/Corporate Sponsorships - (table 4) 3,988 3,773 1,017 1,340 1,175 1,175 855 820 p Advertising - (table 4) 0 0 0 1,650 1,700 1,750 1,803 1,857 E Ground Lease (adjacent property) - (table 4) 0 0 0 750 750 750 750 750 R Bulldog Foundation 0 0 0 1,375 1,375 1,375 1,375 1,375 A Student Seating Revenues - (table2) 0 0 0 300 300 300 300 300 T TOTAL CONTRACTUALLY OBLIGATED INCOME $17,121 $13,225 $11,179 $8,405 $8,289 $8,340 $8,073 $8,092 I N TOTAL OPERATING REVENUES $17,121 $13,225 $11,179 $10,755 $10,724 $11,051 $10,607 $10,639 G OPERATING EXPENSES Salaries and Wages - (table 5) $0 $0 $0 $1,215 $1,251 $1,289 $1,327 $1,367 s Utilities - (table 5) 0 0 0 639 658 678 698 719 u Non-Recoverable Event Related Expenses - (table 5) 0 0 0 100 103 106 109 113 M Management Fee - (table 5) 0 0 0 400 412 424 437 450 M Other - (table 5) 0 0 0 1,001 1,03 1 1,062 1,093 1,126 A TOTAL OPERATING EXPENSES $0 $0 $0 $3,354 $3,455 $3,559 $3,665 $3,775 R y NET OPERATING INCOME $17,121 $13,225 $11,179 $7,401 $7,269 $7,492 $6,941 $6,863

OTHER REVENUES Senior Lein - Debt Service Reserve Fund Earnings $0 $0 $0 $155 $3 11 $3 11 $311 $3 11 Subordinate Lein - Debt Service Reserve Fund Earnings 0 0 0 10 21 21 21 21 Transfer to Construction Fund 17,121 13,225 6,464 0 0 0 0 0 Transfer from Surplus Funds 0 0 0 0 0 0 0 0

REVENUES AVAILABLE FOR SENIOR DEBT SERVICE $0 $0 $4,715 $7,556 $7,580 $7,803 $7,252 $7, 174 REVENUES AVAILABLE FOR TOTAL DEBT SERVICE $0 $0 $4,715 $7,566 $7,601 $7,824 $7,273 $7, 195

FINANCING Senior Debt Service $0 $1,904 $4,130 $5,990 $5,033 $5,167 $4,784 $4,715 Capitalized Interest 0 (1,904) (4, 130) (2,409) 0 0 0 0 Net Senior Debt Service $0 $0 $0 $3,581 $5,033 $5,167 $4,784 $4,715

Capital Replacement Reserve $0 $0 $0 $430 $443 $456 $470 $484

Subordinate Debt Service $0 $161 $350 $4 15 $410 $411 $4 11 $4 11 Capitalized Interest 0 (161) (350) (204) 0 0 0 0 Net Subordinate Debt Service $0 $0 $0 $2 11 $410 $411 $4 11 $4 11

Return of Bulldog Foundation Subsidy $0 $0 $0 $1,375 $1,375 $1,375 $1,375 $1,375

NET ANNUAL SURPLUS $0 $0 $4,715 $1,969 $340 $415 $233 $2 11

CUMMULATIVE SURPLUS $0 $0 $4,715 $6,684 $7,024 $7,438 $7,672 $7,883

DEBT SERVICE COVERAGES Debt Service Coverage Ratio - (Senior Debt) NIA NIA NIA 2.11 1.51 1.51 1.52 1.52 Total Debt Service Coverage Ratio NIA NIA NIA 2.00 1.40 1.40 1.40 1.40 Contractually Obligated Income Coverage Ratio NIA NIA NIA 2.35 1.65 1.61 1.69 1.72 01 /16;02

DEBT SERVICE COVERAGE RATIOS Various Debt Service Coverage Ratios (DSCR) were calculated:

• Funds available for SeniorDebt Service divided by Net Senior Debt Service; • Funds available for TotalDebt Service divided by Net Total Debt Service; and • Total Contractually Obligated Income divided by Net Senior Debt Service Table V-18 illustrates the DSCR for seniorbo nds and for total bonds, as well as contractually obligated income coverage forthe Save Mart Center:

Table V-18 Debt Service Coverage Ratios Debt Service Year A B c

2004 2.11 2.00 2.35 2005 1.51 1.40 1.65 2006 1.51 1.40 1.61 2007 1.52 1.40 1.69 2008 1.52 1.40 1.72

A-Revenues Available for Senior Debt Service I Senior Debt Service B - Revenues Available for Total Debt Service I Total Debt Service C - Contractually Obligated Income I Senior Debt Service

SENSITIVITY ANALYSES We have prepared nine sensitivity analyses in order to test the impact of fluctuating key assumptions. The sensitivity analyses are intended to identify those variables that have the most significant impact on the overall financing and operation of the proposed Save Mart Center. The key factors include the following:

• Reduction of revenues to obtain a I:I Senior Bonds debt service coverage ratio • Reduction of men's basketball attendance to current Selland Arena levels • Reduction of luxury suite renewal revenues • Reduction of PSL renewal revenues • Reduction of advertising renewal revenues • Elimination of additional anchor tenant • Elimination of concerts For the operations after the firstfive yea rs of operation we assumed the following:

• Luxury suites are assumed at a 100 percent renewal at current (2001) prices with 5.0 percent inflation built in at the time of the renewal;

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• Personal seat licenses fSL's) are assumed to renew at approximately 70 percent of current (2001) priceswith no inflation built in; • Arena Builder Seats are assumed to renew at approximately 30 percent of current (2001) prices with no inflation built in; • Ground lease (adjacent property) and student fees remam flat (no inflation built in) throughout; • All other revenue and expense items increase at 3 percent per year (no additional analysis performed). • Below are the summaries of the Base Case cash flow (first five years of operation and the 2 major COi renewal periods).

Sensitivity #1 • Percentage of total revenues required ( assuming that the expenses remain constant) to have a 1 to 1 Senior Debt Coverage Ratio. For purposes of this analysis, we analyzed (1) the first five years of operation; and (2) the firstand second major renewal periods forCOi renewals.

Years 1st 5 years of Operation 1st Major COi Renewals 2nd Major COi Renewals 2004 2005 2006 2007 2008 2012 2013 2014 2022 2023 2024

Percentage of Total Revenues 79.17% 66.22% 66.04% 65.78% 65.53% 64.65% 64.41% 64.20% 62.43% 62.23% 62.05%

Senior Debt Service - DSCR 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00

Sensitivity #2 • Reduce Men's Basketball attendance to recent Selland Arena average (10,000 per game). • All other items remain constant.

Presented on (000' s) Years 1st 5 years of Operation 1st Major COi Renewals 2nd Major COi Renewals CASH FLOW LINE ITEMS 2004 2005 2006 2007 2008 2012 2013 2014 2022 2023 2024

TotalEvent -Related Revenues $2,126 $2,205 $2,476 $2,295 $2,303 $2,545 $2,649 $2,682 $3,269 $3,411 $3,449 Total Contractually Obligated Income $8,405 $8,289 $8,340 $8,073 $8,092 $12,555 $12,696 $12,338 $12,929 $13,096 $13,182 Total Operating Revenues $10,531 $10,495 $10,817 $10,368 $10,395 $15,100 $15,345 $15,020 $16,198 $16,506 $16,632 Other Revenues $165 $332 $332 $332 $332 $332 $332 $332 $332 $332 $332 Total Operating Expenses $3,354 $3,455 $3,559 $3,665 $3,775 $4,249 $4,377 $4,508 $5,711 $5,882 $6,059

Revenues Available for Senior Debt Service $7,331 $7,351 $7,569 $7,013 $6,931 $11,161 $11,280 $10,823 $10,799 $10,935 $10,884 Revenues Available for Total Debt Service $7,341 $7,372 $7,590 $7,034 $6,952 $11,182 $11,301 $10,844 $10,820 $10,956 $10,905 Debt Service Coverage Ratio - (Senior Debt) 2.05 1.46 1.46 1.47 1.47 1.51 1.51 1.52 1.55 1.56 1.56 TotalDebt Service Coverage Ratio 1.94 1.35 1.36 1.35 1.36 1.43 1.44 1.44 1.47 1.47 1.48 Contractually Obligated Income Coverage Ratio 2.35 1.65 1.61 1.69 1.72 1.70 1.70 1.73 1.86 1.86 1.89

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Sensitivity #3 • Reduce Men's Basketball attendance to recent Selland Arena average (10,000 per game). • Eliminate Anchor Tenant (A) - 35 dates. • Reduce advertising by IO percent. • All other items remain constant.

Presented on (000' s) Years 1st 5 years of Operation 1st Major COi Renewals 2nd Major COi Renewals CASH FLOW LINE ITEMS 2004 2005 2006 2007 2008 2012 2013 2014 2022 2023 2024

Total Event-Related Revenues $1,871 $1,960 $2,229 $2,043 $2,043 $2,252 $2,348 $2,372 $2,876 $3,006 $3,032 Total Contractually Obligated Income $8,240 $8,119 $8,165 $7,892 $7,907 $12,346 $12,481 $12,116 $12,648 $12,806 $12,884 Total Operating Revenues $10,112 $10,080 $10,394 $9,935 $9,950 $14,598 $14,829 $14,487 $15,524 $15,812 $15,916 Other Revenues $165 $332 $332 $332 $332 $332 $332 $332 $332 $332 $332 Total Operating Expenses $3,354 $3,455 $3,559 $3,665 $3,775 $4,249 $4,377 $4,508 $5,711 $5,882 $6,059

Revenues Available for Senior Debt Service $6,912 $6,936 $7,147 $6,581 $6,485 $10,660 $10,763 $10,290 $10,124 $10,241 $10,169 Revenues Available for Total Debt Service $6,922 $6,957 $7,168 $6,602 $6,506 $10,681 $10,784 $10,311 $10,145 $10,262 $10,190 Debt Service Coverage Ratio - (Senior Debt) 1.93 1.38 1.38 1.38 1.38 1.44 1.44 1.44 1.45 1.46 1.46 Total Debt Service Coverage Ratio 1.83 1.28 1.28 1.27 1.27 1.37 1.37 1.37 1.38 1.38 1.38 Contractually Obligated Income Coverage Ratio 2.30 1.61 1.58 1.65 1.68 1.67 1.67 1.70 1.82 1.82 1.85

Sensitivity #4 • Luxury suite renewal revenues at 60 percent (of base case assumption). • All other items the same as Sensitivity #3

Presented on (000' s) Years 1st 5 years of Operation 1st Major COi Renewals 2nd Major COi Renewals CASH FLOW LINE ITEMS 2004 2005 2006 2007 2008 2012 2013 2014 2022 2023 2024

Total Event-Related Revenues $1,871 $1,960 $2,229 $2,043 $2,043 $2,252 $2,348 $2,372 $2,876 $3,006 $3,032 Total Contractually Obligated Income $8,240 $8,119 $8,165 $7,892 $7,907 $12,346 $11,824 $11,459 $11,991 $12,1 16 $12,194 Total Operating Revenues $10,112 $10,080 $10,394 $9,935 $9,950 $14,598 $14,171 $13,830 $14,867 $15,122 $15,226 Other Revenues $165 $332 $332 $332 $332 $332 $332 $332 $332 $332 $332 Total Operating Expenses $3,354 $3,455 $3,559 $3,665 $3,775 $4,249 $4,377 $4,508 $5,711 $5,882 $6,059

Revenues Available for Senior Debt Service $6,912 $6,936 $7,147 $6,581 $6,485 $10,660 $10,106 $9,633 $9,467 $9,551 $9,479 Revenues Available for Total Debt Service $6,922 $6,957 $7,168 $6,602 $6,506 $10,681 $10,127 $9,654 $9,488 $9,572 $9,500 Debt Service Coverage Ratio - (Senior Debt) 1.93 1.38 1.38 1.38 1.38 1.44 1.36 1.35 1.36 1.36 1.36 Total Debt Service Coverage Ratio 1.83 1.28 1.28 1.27 1.27 1.37 1.29 1.28 1.29 1.29 1.29 Contractually Obligated Income Coverage Ratio 2.30 1.61 1.58 1.65 1.68 1.67 1.59 1.61 1.72 1.72 1.75

Economics Research Associates California StateUn iversity, F resnoAss ociation,I nc. ERA No. 14042 Page V-27 01/16;0 2

Sensitivity #5 • Luxury suite renewals at 60 percent. • Personal Seat Licenses (PSL's) renew at 60 percent (of base case assumption). • All other items the same as Sensitivity #3.

Presented on (000' s) Years 1st 5 years of Operation 1st Major COi Renewals 2nd Major COi Renewals CASH FLOW LINE ITEMS 2004 2005 2006 2007 2008 2012 2013 2014 2022 2023 2024

TotalEvent -Related Revenues $1,871 $1,960 $2,229 $2,043 $2,043 $2,252 $2,348 $2,372 $2,876 $3,006 $3,032 Total Contractually Obligated Income $8,240 $8,119 $8,165 $7,892 $7,907 $11,146 $10,624 $10,259 $10,791 $10,916 $10,994 Total Operating Revenues $10,112 $10,080 $10,394 $9,935 $9,950 $13,398 $12,971 $12,630 $13,667 $13,922 $14,026 Other Revenues $165 $332 $332 $332 $332 $332 $332 $332 $332 $332 $332 Total Operating Expenses $3,354 $3,455 $3,559 $3,665 $3,775 $4,249 $4,377 $4,508 $5,711 $5,882 $6,059

Revenues Available for Senior Debt Service $6,912 $6,936 $7,147 $6,581 $6,485 $9,460 $8,906 $8,433 $8,267 $8,351 $8,279 Revenues Available for Total Debt Service $6,922 $6,957 $7,168 $6,602 $6,506 $9,481 $8,927 $8,454 $8,288 $8,372 $8,300 Debt Service Coverage Ratio - (Senior Debt) 1.93 1.38 1.38 1.38 1.38 1.28 1.19 1.18 1.19 1.19 1.19 Total Debt Service Coverage Ratio 1.83 1.28 1.28 1.27 1.27 1.21 1.13 1.12 1.12 1.13 1.12 Contractually Obligated Income Coverage Ratio 2.30 1.61 1.58 1.65 1.68 1.51 1.43 1.44 1.55 1.55 1.58

Sensitivity #6 • Luxury suite renewal revenues at 60 percent (of base case assumption). • Personal Seat Licenses (PSL's) renew at 60 percent (of base case assumption). • Advertising renews at 60 percent in 2014 (10 year point). • All other items the same as Sensitivity #3.

Presented on (000' s) Years 1st 5 years of Operation 1st Major COi Renewals 2nd Major COi Renewals CASH FLOW LINE ITEMS 2004 2005 2006 2007 2008 2012 2013 2014 2022 2023 2024

Total Event-Related Revenues $1,871 $1,960 $2,229 $2,043 $2,043 $2,252 $2,348 $2,372 $2,876 $3,006 $3,032 Total Contractually Obligated Income $8,240 $8,119 $8,165 $7,892 $7,907 $11,146 $10,624 $9,460 $10,791 $10,916 $10,994 Total Operating Revenues $10,112 $10,080 $10,394 $9,935 $9,950 $13,398 $12,971 $11,832 $13,667 $13,922 $14,026 Other Revenues $165 $332 $332 $332 $332 $332 $332 $332 $332 $332 $332 Total Operating Expenses $3,354 $3,455 $3,559 $3,665 $3,775 $4,249 $4,377 $4,508 $5,711 $5,882 $6,059

Revenues Available for Senior Debt Service $6,912 $6,936 $7,147 $6,581 $6,485 $9,460 $8,906 $7,635 $8,267 $8,351 $8,279 Revenues Available for Total Debt Service $6,922 $6,957 $7,168 $6,602 $6,506 $9,481 $8,927 $7,656 $8,288 $8,372 $8,300 Debt Service Coverage Ratio - (Senior Debt) 1.93 1.38 1.38 1.38 1.38 1.28 1.19 1.07 1.19 1.19 1.19 Total Debt Service Coverage Ratio 1.83 1.28 1.28 1.27 1.27 1.21 1.13 1.01 1.12 1.13 1.12 Contractually Obligated Income Coverage Ratio 2.30 1.61 1.58 1.65 1.68 1.51 1.43 1.33 1.55 1.55 1.58

Economics Research Associates California StateUn iversity, F resnoAss ociation,I nc. ERA No. 14042 Page V-28 01 /16;02

Sensitivity #7 • Eliminate all concerts throughout the analysis. • All others remain constant.

Presented on (000' s) Years 1st 5 years of Operation 1st Major COi Renewals 2nd Major COi Renewals CASH FLOW LINE ITEMS 2004 2005 2006 2007 2008 2012 2013 2014 2022 2023 2024

Total Event-Related Revenues $1,904 $2,21 1 $2,237 $2,297 $2,045 $2,244 $2,637 $2,359 $2,837 $3,364 $2,985 Total Contractually Obligated Income $8,405 $8,289 $8,340 $8,073 $8,092 $12,555 $12,696 $12,338 $12,929 $13,096 $13,182 Total Operating Revenues $10,309 $10,500 $10,578 $10,369 $10,137 $14,800 $15,333 $14,697 $15,766 $16,459 $16,167 Other Revenues $165 $332 $332 $332 $332 $332 $332 $332 $332 $332 $332 Total Operating Expenses $3,354 $3,455 $3,559 $3,665 $3,775 $4,249 $4,377 $4,508 $5,711 $5,882 $6,059

Revenues Available for Senior Debt Service $7,110 $7,356 $7,330 $7,015 $6,673 $10,861 $11,267 $10,500 $10,367 $10,888 $10,420 Revenues Available for Total Debt Service $7,120 $7,377 $7,351 $7,036 $6,694 $10,882 $11,288 $10,521 $10,388 $10,909 $10,441 Debt Service Coverage Ratio - (Senior Debt) 1.99 1.46 1.42 1.47 1.42 1.47 1.51 1.47 1.49 1.55 1.49 TotalDebt Service Coverage Ratio 1.88 1.36 1.32 1.35 1.31 1.39 1.44 1.39 1.41 1.47 1.41 Contractually Obligated Income Coverage Ratio 2.35 1.65 1.61 1.69 1.72 1.70 1.70 1.73 1.86 1.86 1.89

Sensitivity #8 • Eliminate all concerts throughout the analysis. • Reduce Men's Basketball attendance to recent Selland Arena average (10,000 per game). • Eliminate Anchor Tenant (A) - 35 dates. • Reduce advertising by 25 percent. • All others remain constant.

Presented on (000' s) Years 1st 5 years of Operation 1st Major COi Renewals 2nd Major COi Renewals CASH FLOW LINE ITEMS 2004 2005 2006 2007 2008 2012 2013 2014 2022 2023 2024

Total Event-Related Revenues $1,426 $1,737 $1,756 $1,806 $1,541 $1,687 $2,065 $1,773 $2,117 $2,625 $2,227 Total Contractually Obligated Income $7,993 $7,865 $7,903 $7,622 $7,628 $12,033 $12,158 $11,783 $12,227 $12,372 $12,437 Total Operating Revenues $9,418 $9,601 $9,659 $9,428 $9,170 $13,720 $14,223 $13,556 $14,344 $14,997 $14,664 Other Revenues $165 $332 $332 $332 $332 $332 $332 $332 $332 $332 $332 Total Operating Expenses $3,354 $3,455 $3,559 $3,665 $3,775 $4,249 $4,377 $4,508 $5,711 $5,882 $6,059

Revenues Available for Senior Debt Service $6,219 $6,457 $6,411 $6,073 $5,705 $9,781 $10,157 $9,359 $8,945 $9,426 $8,917 Revenues Available for Total Debt Service $6,229 $6,478 $6,432 $6,094 $5,726 $9,802 $10,178 $9,380 $8,966 $9,447 $8,938 Debt Service Coverage Ratio - (Senior Debt) 1.74 1.28 1.24 1.27 1.21 1.32 1.36 1.31 1.29 1.34 1.28 TotalDebt Service Coverage Ratio 1.64 1.19 1.15 1.17 1.12 1.25 1.29 1.24 1.22 1.27 1.21 Contractually Obligated Income Coverage Ratio 2.23 1.56 1.53 1.59 1.62 1.63 1.63 1.65 1.76 1.76 1.78

Economics Research Associates California StateUn iversity, F resnoAss ociation,I nc. ERA No. 14042 Page V-29 01 /16;02

Sensitivity #9 • Base case revenues constant. • Increase operating expenses 5 percent per year

Presented on (000' s) Years 1st 5 years of Operation 1st Major COi Renewals 2nd Major COi Renewals CASH FLOW LINE ITEMS 2004 2005 2006 2007 2008 2012 2013 2014 2022 2023 2024

Total Event-Related Revenues $2,234 $2,312 $2,577 $2,406 $2,420 $2,668 $2,770 $2,809 $3,411 $3,548 $3,595 Total Contractually Obligated Income $8,405 $8,289 $8,340 $8,073 $8,092 $12,555 $12,696 $12,338 $12,929 $13,096 $13,182 Total Operating Revenues $10,639 $10,602 $10,917 $10,479 $10,512 $15,223 $15,466 $15,147 $16,340 $16,644 $16,777 Other Revenues $165 $332 $332 $332 $332 $332 $332 $332 $332 $332 $332 Total Operating Expenses $3,517 $3,623 $3,731 $3,843 $3,959 $4,455 $4,589 $4,727 $5,988 $6,167 $6,352

Revenues Available for Senior Debt Service $7,277 $7,290 $7,497 $6,947 $6,865 $11,079 $11,188 $10,731 $10,663 $10,788 $10,736 Revenues Available for Total Debt Service $7,287 $7,311 $7,518 $6,968 $6,886 $11,100 $11,209 $10,752 $10,684 $10,809 $10,757 Debt Service Coverage Ratio - (Senior Debt) 2.03 1.45 1.45 1.45 1.46 1.50 1.50 1.50 1.53 1.54 1.54 TotalDebt Service Coverage Ratio 1.92 1.34 1.35 1.34 1.34 1.42 1.43 1.42 1.45 1.45 1.46 Contractually Obligated Income Coverage Ratio 2.35 1.65 1.61 1.69 1.72 1.70 1.70 1.73 1.86 1.86 1.89

Economics Research Associates California StateUn iversity, F resnoAss ociation,I nc. ERA No. 14042 Page V-30 CASH FLOW SUMMARY SAVE MART CENTER - BASE CASE Cash Flow Summary 1 /1 6;02

Table 1 Cash Flow Summary SAVE MART CENTER - BASE CASE Fiscal Year 2001 2002 I 2003 I 2004 ! 2005 I 2006 ! 2007 I 2008 ! Number of Events 0 0 0 121 119 126 119 122 Annual Paid Attendance (000) 0 0 0 730 735 771 733 720

EVENT-RELATED REVENUES Tickets - (table3) Fresno State Athletic Events $0 $0 $0 $0 $0 $0 $0 $0 Other Anchor Tenant( s) 0 0 0 250 250 250 250 250 Concerts 0 0 0 211 107 224 113 237 Other Events 0 0 0 211 311 327 328 239 Total Ticket Revenue $0 $0 $0 $672 $667 $800 $691 $726 Concessions/Novelties/Parking - (table 6) Concessions $0 $0 $0 $1,508 $1,604 $1,737 $1,679 $1,646 Novelties 0 0 0 19 11 20 12 21 Parking 0 0 0 0 0 0 0 0 Total Concessions/Novelties/Parking Revenues $0 $0 $0 $1,527 $1,615 $1,758 $1,690 $1,667 Facility Use Fee - (table 2) $0 $0 $0 $151 $152 $152 $153 $153 Box Office - (table 2) 0 0 0 0 0 0 0 0 TOTAL EVENT-RELATED REVENUES $0 $0 $0 $2,350 $2,434 $2,710 $2,534 $2,547

CONTRACTUALLY OBLIGATED INCOME Luxury Suites - (table4) $855 $0 $710 $1,565 $1,565 $1,565 $1,565 $1,565 Arena Builder Seats (3 year payments) - (table 4) 6,960 4,870 4,870 0 0 0 0 0 Arena Builder Seats (10 year payments) - (table 4) 0 40 40 40 40 40 40 40 Personal Seat Licenses - (table 4) 3,489 4,542 4,542 0 0 0 0 0 Naming Rights - (table 4) 1,829 0 0 1,385 1,385 1,385 1,385 1,385 0 Private Fundraising/Corporate Sponsorships - (table 4) 3,988 3,773 1,017 1,340 1,175 1,175 855 820 p Advertising - (table 4) 0 0 0 1,650 1,700 1,750 1,803 1,857 E Ground Lease (adjacent property) - (table 4) 0 0 0 750 750 750 750 750 R Bulldog Foundation 0 0 0 1,375 1,375 1,375 1,375 1,375 A Student Seating Revenues - (table2) 0 0 0 300 300 300 300 300 T TOTAL CONTRACTUALLY OBLIGATED INCOME $17,121 $13,225 $11,179 $8,405 $8,289 $8,340 $8,073 $8,092 I N TOTAL OPERATING REVENUES $17,121 $13,225 $11,179 $10,755 $10,724 $11,051 $10,607 $10,639 G OPERATING EXPENSES Salaries and Wages - (table 5) $0 $0 $0 $1,215 $1,251 $1,289 $1,327 $1,367 s Utilities - (table 5) 0 0 0 639 658 678 698 719 u Non-Recoverable Event Related Expenses - (table 5) 0 0 0 100 103 106 109 113 M Management Fee - (table 5) 0 0 0 400 412 424 437 450 M Other - (table 5) 0 0 0 1,001 1,03 1 1,062 1,093 1,126 A TOTAL OPERATING EXPENSES $0 $0 $0 $3,354 $3,455 $3,559 $3,665 $3,775 R y NET OPERATING INCOME $17,121 $13,225 $11,179 $7,401 $7,269 $7,492 $6,941 $6,863

OTHER REVENUES Senior Lein - Debt Service Reserve Fund Earnings $0 $0 $0 $155 $3 11 $3 11 $311 $3 11 Subordinate Lein - Debt Service Reserve Fund Earnings 0 0 0 10 21 21 21 21 Transfer to Construction Fund 17,121 13,225 6,464 0 0 0 0 0 Transfer from Surplus Funds 0 0 0 0 0 0 0 0

REVENUES AVAILABLE FOR SENIOR DEBT SERVICE $0 $0 $4,715 $7,556 $7,580 $7,803 $7,252 $7, 174 REVENUES AVAILABLE FOR TOTAL DEBT SERVICE $0 $0 $4,715 $7,566 $7,601 $7,824 $7,273 $7, 195

FINANCING Senior Debt Service $0 $1,904 $4,130 $5,990 $5,033 $5,167 $4,784 $4,715 Capitalized Interest 0 (1,904) (4, 130) (2,409) 0 0 0 0 Net Senior Debt Service $0 $0 $0 $3,581 $5,033 $5,167 $4,784 $4,715

Capital Replacement Reserve $0 $0 $0 $430 $443 $456 $470 $484

Subordinate Debt Service $0 $161 $350 $4 15 $410 $411 $4 11 $4 11 Capitalized Interest 0 (161) (350) (204) 0 0 0 0 Net Subordinate Debt Service $0 $0 $0 $2 11 $410 $411 $4 11 $4 11

Return of Bulldog Foundation Subsidy $0 $0 $0 $1,375 $1,375 $1,375 $1,375 $1,375

NET ANNUAL SURPLUS $0 $0 $4,715 $1,969 $340 $415 $233 $2 11

CUMMULATIVE SURPLUS $0 $0 $4,715 $6,684 $7,024 $7,438 $7,672 $7,883

DEBT SERVICE COVERAGES Debt Service Coverage Ratio - (Senior Debt) NIA NIA NIA 2.11 1.51 1.51 1.52 1.52 Total Debt Service Coverage Ratio NIA NIA NIA 2.00 1.40 1.40 1.40 1.40 Contractually Obligated Income Coverage Ratio NIA NIA NIA 2.35 1.65 1.61 1.69 1.72

Propa;edSave Mart Center -Prepired0y Ec onomicsResearch Associates 1/16/02 12:31 PM Revenue Summaries 1/16/02

Table 2 ARENA OPERATING REVENUE SUMMARY (000) SAVE MART CENTER - BASE CASE Fiscal Year I 2001 I 2002 I 2003 I 2004 I 2005 2006 I 2001 I 2008 I

Number of Events 0 0 0 121 119 126 119 122 Annual Paid Attendance (000) 0 0 0 730 735 771 733 720

Gross Ticket Revenues Fresno State Athletics $0 $0 $0 $5,642 $5,817 $5,999 $6,187 $6,372 Other Anchor Tenant(s) 0 0 0 1,540 1,511 1,556 1,603 1,651 Concerts 0 0 0 2,635 1,334 2,796 1,41 5 2,965 Other Events 0 0 0 0 0 0 0 0 Total Gross Ticket Revenues $0 $0 $0 $9,817 $8,662 $10,351 $9,205 $10,988 Less: Facility Use Fee 0 0 0 151 152 152 153 153 Less: Admissions Tax 0 0 0 0 0 0 0 0 Net Ticket Revenues $0 $0 $0 $9,666 $8,510 $10,199 $9,052 $10,835 Ticket Revenue to Arena $0 $0 $0 $672 $667 $800 $691 $726

Total Luxury Suite Premium Revenue $0 $0 $0 $1,565 $1,565 $1,565 $1,565 $1,565 Less: Share to Promoter/Tenant 0 0 0 0 0 0 0 0 Luxury Suite Premium Revenue to Arena $855 $0 $710 $1,565 $1,565 $1,565 $1,565 $1,565

Net Advertising Revenue $0 $0 $0 $1,650 $1,700 $1,750 $1,803 $1,857 Less: Share to Promoter/Tenant 0 0 0 0 0 0 0 0 Advertising Revenue to Arena $0 $0 $0 $1,650 $1,700 $1,750 $1,803 $1,857

Total Building Name Revenue $1,829 $0 $0 $1,385 $1,385 $1,385 $1,385 $1,385 Less: Share to Tenant 0 0 0 0 0 0 0 0 Building Name Revenue to Arena $1,829 $0 $0 $1,385 $1,385 $1,385 $1,385 $1,385

Net Concessions Revenue $0 $0 $0 $1,508 $1,604 $1,737 $1,679 $1,646

Net Novelty Revenue $0 $0 $0 $19 $11 $20 $12 $21

Net Parking Revenue $0 $0 $0 $0 $0 $0 $0 $0

Student Seating Revenues $0 $0 $0 $300 $300 $300 $300 $300

ARENA OPERATING REVENUE $855 $0 $710 $5,714 $5,847 $6,173 $6,049 $6,115

Prorxised SaveMart Center -Prepared b;Econcrrucs Research Associates 1/16,()2 12 14PM Revenue Summaries 1/16/02

Table 3 NET TICKET (RENT) REVENUE SUMMARY (000) SAVE MART CENTER - BASE CASE Fiscal Year I 2001 I 2002 I 2003 2004 I 2005 2006 I 2001 I 2008 I Fresno State Athletics Fresno State's Men's Basketball 0 0 0 0 0 0 0 0 Fresno State's Women's Basketball 0 0 0 0 0 0 0 0 Fresno State's Women's Volleyball Q_ Q_ Q_ Q_ Q_ Q_ Q_ Q_ Total Fresno State Athletics Ticket Revenue 0 0 0 0 0 0 0 0

Other Anchor Tenant(s) Anchor Tenant - A 0 0 0 250 250 250 250 250 Anchor Tenant - B Q_ Q_ Q_ Q_ Q_ Q_ Q_ Q_ Total Anchor Tenant(s) Ticket Revenue 0 0 0 250 250 250 250 250

Concerts Concerts - Popular 0 0 0 58 20 61 21 65 Concerts - Country 0 0 0 67 23 71 24 76 Concerts - Alternative 0 0 0 30 21 32 22 34 Concerts - Ethnic Q_ Q_ Q_ i§_ ±l 22 1§ fil Total Concert Ticket Revenue 0 0 0 211 107 224 113 237

Other Events Motors ports 0 0 0 9 9 9 9 9 Rodeo I Bull Riding 0 0 0 12 12 13 12 12 Roller Jam 0 0 0 9 9 10 9 10 Family Shows A 0 0 0 25 22 23 20 20 Family Shows B 0 0 0 16 20 21 26 26 NCAA Tournaments 0 0 0 0 0 96 0 0 WAC Tournaments 0 0 0 0 70 0 74 0 Tennis 0 0 0 25 26 27 27 28 International Volleyball 0 0 0 2 3 3 3 3 NBA Exhibition 0 0 0 0 23 0 25 0 Gymnastics 0 0 0 0 0 8 0 4 Professional Wresteling 0 0 0 101 104 107 110 113 High School Championships 0 0 0 9 9 10 10 10 Other Miscellaneous 0 0 0 3 3 3 3 3 Total Other Events Ticket Revenue $0 $0 $0 $211 $311 $327 $328 $239

TOTAL TICKET/RENT REVENUE TO ARENA $0 I $0 I $0 I $612 I $667 I $800 I $691 I $726 I

ProrxisedSave Mart Center -Prepared b;Econcrrucs Research Associates 1/16,()2 12 14PM Revenue Summaries 1/16/02

Table 4 CONTRACTUALLY OBLIGATED INCOME SUMMARY ($ in 000) SAVE MART CENTER -BAS E CAS E Fiscal Year I 2001 I 2002 I 2003 I 2004 I 2005 2006 I 2001 I 2008 I

NON-EVENT RELATED REVENUES Arena Builder Seats (3 yearpayments) 1.00 6,960 4,870 4,870 0 0 0 0 0 Arena Builder Seats (IO year payments) 1.00 0 40 40 40 40 40 40 40 Personal Seat Licenses 1.00 3,489 4,542 4,542 0 0 0 0 0 Private Fundraising/Corporate Sponsorships 1.00 3,988 3,773 1,017 1,340 1,175 1,175 855 820 Ground Lease (adjacent property) 1.00 0 0 0 750 750 750 750 750 TOT AL NON-EVENT RELATED REVENUES 14,437 13,225 10,469 2,130 1,965 1,965 1,645 1,610

LUXURY SUITES Total Number of Suites 32 32 32 32 Suites Not Available for Lease 2 2 2 2 Suites Leased Utilization 100% 30 30 30 30

Gross Lease Price Less: Ticket Revenues Luxury Suite Premium Escalation 0.0%

Net Premium Revenue 1,565 Percentage to Arena 100.0% Net Arena Luxury Suite Revenue (000) 855 0 710 1,565

ADVERTISING Total Revenues Escalation 3.0% $0 $0 $0 $1,650 $1,700 $1,750 $1,803 $1,857 Percentage to Arena 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% Net Arena Advertising Revenue $0 $0 $0 $1,650 $1,700 $1,750 $1,803 $1,857

NAMING RIGHTS Total Revenues Escalation 0.0% $1,829 0 0 $1,385 $1,385 $1,385 $1,385 $1,385 Percentage to Arena 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% Net Arena Naming Rights Revenue (000) $1,829 $0 $0 $1,385 $1,385 $1,385 $1,385 $1,385

TOTAL COi REVENUE TO ARENA I $11,121 I $13,225 I $11,119 I $6,130 I $6,614 I $6,665 I $6,398 I $6,411 I

ProrxisedSave Mart Center -Prepared b;Econcrrucs Research Associates 1/16,()2 12 14PM Revenue Summaries 1/16/02

Table 5 ARENA OPERATING EXPENSES SAVE MART CENTER - BASE CASE Fiscal Year I 2001 I 2002 I 2003 I 2004 I 2005 2006 I 2001 I 2008 I Salaries and Wages Full-Time Salaries and Wages 1.00 $0 $0 $0 $944 $972 $1,001 $1,031 $1,062 Employees Benefits ##### 0 0 0 236 243 250 258 266 Total Full-Time Staffing $0 $0 $0 $1,180 $1,215 $1,252 $1,289 $1,328 Part-Time Staffing 1.00 0 0 0 35 36 37 38 39 Total Salaries and Wages $0 $0 $0 $1,215 $1,251 $1,289 $1,327 $1,367

Utilities ll0% Electric 1.00 $0 $0 $0 $419 $432 $445 $458 $472 Gas 1.00 0 0 0 165 170 175 180 186 Water and Sewer 1.00 0 0 0 39 40 41 42 43 Waste 1.00 0 0 0 17 17 18 18 19 Total Utilities $0 $0 $0 $639 $658 $678 $698 $719

Non-Reimbursed Event Expenses $0 I $0 I $0 I $100 I 103 106 I 109 I rn I Management Fee Annual Fee 1.00 $0 0 0 $400 $412 $424 $437 $450

Incentive Fee 1.00 0c+- 0c+- 0c+- = 0c+- = 0c+- 0c+- = 0c-+- 0 Total Management Fee 1--� $=o �-$=o ��$0 �$�4oo �$�412 �$�42�4 �$�431 �$�45=o�

Other Expenses Administrative Expenses 1.00 $0 $0 $0 $244 $251 $258 $266 $274 Building Expenses 1.00 0 0 0 588 605 623 642 661 Insurance Expense 1.00 0 0 0 107 llO ll3 ll6 120 Professional Fees 1.00 0 0 0 63 65 67 69 71 Total Other Expenses $0 $0 $0 $1,001 $1,031 $1,062 $1,093 $1,126

ProrxisedSave Mart Center -Prepared b;Econcrrucs Research Associates 1/16,()2 12 14PM Revenue Summaries 1/16/02

Table 6 CONCESSION/NOVELTY/PARKING NET OPERATING REVENUES (000) SAVE MART CENTER - BASE CASE Fiscal Year GROSS REVENUES I 2001 I 2002 I 2003 I 2004 I 2005 I 2006 I 2001 I 2008 I

CONCESSIONS (GROSS) Fresno State Athletic Events $0 $0 $0 $1,748 $1,796 $1,845 $1,896 $1,942 Other Anchor Tenant(s) 0 0 0 1,271 1,224 1,237 1,262 1,300 Concerts 0 0 0 548 272 581 289 616 Other Events 0 0 0 839 1,331 1,299 1,381 907 Total Gross Arena Concession Revenue (000) $0 $0 $0 $4,406 $4,623 $4,962 $4,828 $4,765

NOVELTIES (GROSS) Fresno State Athletic Events $0 $0 $0 $436 $449 $461 $474 $486 Other Anchor Tenant(s) 0 0 0 318 306 309 316 325 Concerts 0 0 0 638 318 678 337 719 Other Events 0 0 0 465 692 636 720 500 Total Gross Arena Novelty Revenue (000) $0 $0 $0 $1,858 $1,764 $2,084 $1,847 $2,030

PARKING (GROSS) Fresno State Athletic Events $0 $0 $0 $822 $845 $868 $892 $914 Other Anchor Tenant(s) 0 0 0 593 571 577 589 607 Concerts 0 0 0 255 127 271 135 287 Other Events 0 0 0 354 539 513 558 378 Total Gross Arena Parking Revenue (000) $0 $0 $0 $2,024 $2,082 $2,230 $2,174 $2,187

TOTAL GROSS REVENUES $0 I $0 I $0 I $8,288 I $8,469 I $9,216 I $8,849 I $8,982 I

OPERATING EXPENSES AND DISTRIBUTIONS CONCESSIONS Fresno State Athletic Events $0 $0 $0 $1,049 $1,078 $1,107 $1,138 $1,165 Other Anchor Tenant(s) 0 0 0 1,017 979 990 1,010 1,040 Concerts 0 0 0 329 163 349 173 370 Other Events 0 0 0 503 799 779 829 544 Total COGS/Operating Expenses and Distributions $0 $0 $0 $2,898 $3,019 $3,225 $3,149 $3 ,119

NOVELTIES Fresno State Athletic Events $0 $0 $0 $436 $449 $461 $474 $486 Other Anchor Tenant(s) 0 0 0 318 306 309 316 325 Concerts 0 0 0 622 310 661 329 701 Other Events 0 0 0 462 689 633 717 497 Total COGS/Operating Expenses and Distributions $0 $0 $0 $1,839 $1,753 $2,064 $1,836 $2,009

PARKING Fresno State Athletic Events $0 $0 $0 $822 $845 $868 $892 $914 Other Anchor Tenant(s) 0 0 0 593 571 577 589 607 Concerts 0 0 0 255 127 271 135 287 Other Events 0 0 0 354 539 513 558 378 Total Operating Expenses and Distributions $0 $0 $0 $2,024 $2,082 $2,230 $2,174 $2,187

TOTAL OTHER OPERATING EXPENSES AND DISTRIBUTIONS $0 ! $0 ! $0 ! $4,922 ! $5,100 ! $5,454 ! $5,323 ! $5,306 !

TOTAL ARENA NET CONCESSION/NOVEL TYIP ARKING REVENUE�-�$0�1 -�$_O�__$�O��$� 3,�36_6��$_3�,3_69�_$�3�,8_2_l ��$3�,5_2_6��$�3,�67_6� I l l I ! l l I

ProrxisedSave Mart Center -Prepared b;Econcrrucs Research Associates 1/16,()2 12 14PM mensbb 1/16/02

Table 7 FRESNO STATE'S MEN'S BASKETBALL SAVE MART CENTER - BASE CASE Fiscal Year I 2004 I 2005 2006 I 2001 I 2008 I

Tickets Games/Performances 19 19 19 19 19 Average Paid Attendance 14.l 14.l 14.l 14.l 14.l Avg. Luxury Suite Attendance 0.4 0.4 0.4 0.4 0.4 Total Paid Attendance (000) 275.5 275.5 275.5 275.5 275.5

Average Ticket Price I $20.00 I $20.60 I $21.22 I $21.85 I $22.51 I

Gross Ticket Revenue (000) $5,510 $5,675 $5,845 $6,021 $6,201 Facility Use Fee $0.50 138 138 138 138 138 Admissions Tax 0.0% 0 0 0 0 0 Net Ticket Revenue (000) $5,372 $5,537 $5,707 $5,883 $6,063 Facility Rent 0.0% $0 I $0 I $0 I $0 I $0 I Less: No Show Percentage 5.0% 5.5% 6.0% 6.5% 7.0% Add: Complimentary 5.0% 5.0% 5.0% 5.0% 5.0%

Concessions Actual Attendance 275.5 274.l 272.7 271.4 270.0 Per Capita - (I) $6.00 $6.18 $6.37 $6.56 $6.75 Gross Revenue (000) $1,653 $1,694 $1,736 $1,779 $1,823 Less: COGS/Operating Expenses 60.0% 992 l,016 l,042 l,067 l,094 Net Concession Revenue (000) $661 $678 $694 $7 12 $729 Less: Distributionto Tenant 0.0% 0 0 0 0 0 Net Concession Revenue (000) $661 $678 $694 $7 12 $729

Novelties Actual Attendance 275.5 274.l 272.7 271.4 270.0 Per Capita $1.50 $1.55 $1.59 $1.64 $1.69 Gross Revenue (000) $413 $424 $434 $445 $456 Less: COGS/Operating Expenses 75.0% 310 318 326 334 342 Net Novelty Revenue (000) $103 $106 $109 $Ill $ll4 Less: Distributionto Tenant 100.0% 103 106 109 lll ll4 Net Novelty Revenue (000) $0 $0 $0 $0 $0

Parking Actual Attendance 275.5 274.l 272.7 271.4 270.0 Patrons Per Car 2.50 2.50 2.50 2.50 2.50 Rate Per Car $7.00 $7.21 $7.43 $7.65 $7.88 Gross Revenue (000) $771 $791 $810 $830 $851 Less: Parking Expenses 15.0% ll6 ll9 122 125 128 Less: Parking Surcharge $0.00 0 0 0 0 0 Net Parking Revenue (000) $656 $672 $689 $706 $723 Less: Distribution to Tenant/Other 100.0% 656 672 689 706 723 Net Parking Revenue (000) $0 $0 $0 $0 $0

(I) - Assumes weighted average for general seating, premium seating and catered food and beverage sales.

ProrxisedSave Mart Center -Prepared t,.,iE conom1cs ResearchAssociates l/16;02 12 03 PM CASH FLOW DETAIL SAVE MART CENTER - BASE CASE womens bb 1 /1 6/02

Table 8 FRESNO STATE'S WOMEN'S BASKETBALL SAVE MART CENTER - BAS E CAS E Fiscal Year I 2004 I 2005 I 2006 I 2001 I 2008 I

Tickets Games/Performances 13 13 13 13 13 Average Paid Attendance 0.8 0.8 0.8 0.9 0.9 Avg. Luxury Suite Attendance 0.0 0.0 0.0 0.0 0.0 Total Paid Attendance (000) 10.4 10.9 11.4 11.9 11.9

Average Ticket Price $5.oo I $5.15 I $5.30 I $5.46 I $5.63 I

Gross Ticket Revenue (000) $52 $56 $61 $65 $67 Facility Use Fee $0.50 5 5 6 6 6 Admissions Tax 0.0% 0 0 0 0 0 Net Ticket Revenue (000) $47 $51 $55 $59 $61

Facility Rent 0.0% $0 I $0 I $0 I $0 I $0 I Less: No Show Percentage 5.0% 6.0% 7.0% 8.0% 9.0% Add: Complimentary 25.0% 25.0% 25.0% 25.0% 25.0%

Concessions Actual Attendance 12.5 13.0 13.5 14.0 13.9 Per Capita - ( 1) $3.00 $3.09 $3.18 $3.28 $3.38 Gross Revenue (000) $37 $40 $43 $46 $47 Less: COGS/Operating Expenses 60.0% 22 24 26 28 28 Net Concession Revenue (000) $15 $16 $17 $18 $19 Less: Distribution to Tenant 0.0% 0 0 0 0 0 Net Concession Revenue (000) $15 $16 $17 $18 $19

Novelties Actual Attendance 12.5 13.0 13.5 14.0 13.9 Per Capita $0.75 $0.77 $0.80 $0.82 $0.84 Gross Revenue (000) $9 $10 $11 $11 $12 Less: COGS/Operating Expenses 75.0% 7 8 8 8 9 Net NoveltyRe venue (000) $2 $3 $3 $3 $3 Less: Distribution to Tenant 100.0% 2 3 3 3 3 Net Novelty Revenue (000) $0 $0 $0 $0 $0

Parking Actual Attendance 12.5 13.0 13.5 14.0 13.9 Patrons Per Car 2.50 2.50 2.50 2.50 2.50 Rate Per Car $4.00 $4.12 $4.24 $4.37 $4.50 Gross Revenue (000) $20 $21 $23 $24 $25 Less: Parking Expenses 15.0% 3 3 3 4 4 Less: Parking Surcharge $0.00 0 0 0 0 0 Net Parking Revenue (000) $17 $18 $19 $21 $21 Less: Distribution to Tenant/Other 100.0% 17 18 19 21 21 Net Parking Revenue (000) $0 $0 $0 $0 $0

(1) - Assumes weighted average forgener al seating, premium seating and catered foodand beverage sales

Proposed Save Mart Center -Prepared O)' E cononics Research Associates 1 /1 6/02 12: 38 PM womensvb 1 /1 6/02

Table 9 FRESNO STATE'S WOMEN'S VOLLEYBALL SAVE MART CENTER - BASE CASE Fiscal Year I 2004 I 2005 I 2006 I 2001 I 2008 I Tickets Games/Performances 16 16 16 16 16 Average Paid Attendance 1.0 1.0 1.1 1.1 1.1 Avg. Luxury Suite Attendance 0.0 0.0 0.0 0.0 0.0 Total Paid Attendance (000) 16.0 16.8 17.6 18.4 18.4 Average Ticket Price $5.oo I $5.15 I $5.30 I $5.46 I $5.63 I Gross Ticket Revenue (000) $80 $86 $93 $101 $104 Facility Use Fee $0.50 8 8 9 9 9 Admissions Tax 0.0% 0 0 0 0 0 Net Ticket Revenue (000) $72 $78 $84 $92 $95

Facility Rent 0.0% $0 I $0 I $0 I $0 I $0 I Less: No Show Percentage 5.0% 6.0% 7.0% 8.0% 9.0% Add: Complimentary 25.0% 25.0% 25.0% 25.0% 25.0%

Concessions Actual Attendance 19.2 19.9 20.7 21.5 21.4 Per Capita - ( 1) $3.00 $3.09 $3.18 $3.28 $3.38 Gross Revenue (000) $58 $62 $66 $71 $72 Less: COGS/Operating Expenses 60.0% 35 37 40 43 43 Net Concession Revenue (000) $23 $25 $26 $28 $29 Less: Distribution to Tenant 0.0% 0 0 0 0 0 Net Concession Revenue (000) $23 $25 $26 $28 $29

Novelties Actual Attendance 19.2 19.9 20.7 21.5 21.4 Per Capita $0.75 $0.77 $0.80 $0.82 $0.84 Gross Revenue (000) $14 $15 $16 $18 $18 Less: COGS/Operating Expenses 75.0% 11 11 12 14 14 Net Novelty Revenue (000) $4 $4 $4 $5 $5 Less: Distribution to Tenant 100.0% 4 4 4 5 5 Net Novelty Revenue (000) $0 $0 $0 $0 $0

Parking Actual Attendance 19.2 19.9 20.7 21.5 21.4 Patrons Per Car 2.50 2.50 2.50 2.50 2.50 Rate Per Car $4.00 $4.12 $4.24 $4.37 $4.50 Gross Revenue (000) $3 1 $33 $35 $38 $38 Less: Parking Expenses 15.0% 5 5 5 6 6 Less: Parking Surcharge $0.00 0 0 0 0 0 Net Parking Revenue (000) $26 $28 $30 $32 $33 Less: Distribution to Tenant/Other 100.0% 26 28 30 32 33 Net Parking Revenue (000) $0 $0 $0 $0 $0

( 1) - Assumes weighted average forgeneral seating, premium seating and catered foodand beverage sal

Proposed Save Mart Center -Prepared O)' cononiE cs Research Associates 1/16/02 12:llPM anchor A 1 /1 6�2

Table 10 ANCHOR - A (TBD) SAVE MART CENTER -BAS E CAS E Fiscal Year I 2004 I 2005 I 2006 I 2007 I 2008 I Tickets Games/Performances 35 35 35 35 35 Average Paid Attendance 5.2 5.0 5.0 5.0 5.0 Avg. Luxury Suite Attendance 0.3 0.3 0.3 0.3 0.3 Total Paid Attendance (000) 192.5 183.3 183.3 183.3 183.3 Average Ticket Price $8.oo I $8.24 I $8.49 I $8.74 I $9.oo I Gross Ticket Revenue (000) $1,540 $1,511 $1,556 $1,603 $1,65 1 FacilityUse Fee $0.00 0 0 0 0 0 Admissions Tax 0.0% 0 0 0 0 0 Net Ticket Revenue (000) $1,540 $1,511 $1,556 $1,603 $1,65 1

FacilityRent $250,000 $250 I $250 I $250 I $250 I $250 I Less: No Show Percentage 10.0% 12.0% 14.0% 15.0% 15.0% Add: Complimentary 20.0% 20.0% 20.0% 20.0% 20.0%

Concessions Actual Attendance 211.8 198.0 194.3 192.5 192.5 Per Capita - ( 1) $6.00 $6. 18 $6.37 $6.56 $6.75 Gross Revenue (000) $1,271 $1,224 $1,237 $1,262 $1,300 Less: COGS/Operating Expenses 60.0% 763 734 742 757 780 Net Concession Revenue (000) $508 $490 $495 $505 $520 Less: Distribution to Tenant 50.0% 254 245 247 252 260 Net Concession Revenue (000) $254 $245 $247 $252 $260

Novelties Actual Attendance 211.8 198.0 194.3 192.5 192.5 Per Capita $1.50 $1.55 $1.59 $1.64 $1.69 Gross Revenue (000) $318 $306 $309 $316 $325 Less: COGS/Operating Expenses 75.0% 239 230 232 237 244 Net Novelty Revenue (000) $80 $77 $77 $79 $81 Less: Distribution to Tenant 100.0% 80 77 77 79 81 Net Novelty Revenue (000) $0 $0 $0 $0 $0

Parking Actual Attendance 211.8 198.0 194.3 192.5 192.5 Patrons Per Car 2.5 2.5 2.5 2.5 2.5 Rate Per Car $7.00 $7.21 $7.43 $7.65 $7.88 Gross Revenue (000) $593 $571 $577 $589 $607 Less: Parking Expenses 15.0% 89 86 87 88 91 Less: Parking Surcharge $0.00 0 0 0 0 0 Net Parking Revenue (000) $504 $485 $491 $501 $5 16 Less: Distributionto Tenant/Other 100.0% 504 485 491 501 516 Net Parking Revenue (000) $0 $0 $0 $0 $0

(1) - Assumes weighted average for general seating, premium seating and catered foodand beverage sales

Proposed Save Mart Center -Preparedby Ec onomics Research Associates 1 /1 6;02 10:07 AM anchor B 1 /1 6/02

Table 11 ANCHOR - A (TBD) SAVE MART CENTER -BAS E CAS E Fiscal Year I 2004 I 2005 2006 I 2001 I 2008 I Tickets Games/Performances 0 0 0 0 0 Average Paid Attendance 11.2 10.6 10.1 9.6 9.6 Avg. Luxury Suite Attendance 0.3 0.3 0.3 0.3 0.3 Total Paid Attendance (000) 0.0 0.0 0.0 0.0 0.0 Average Ticket Price I $15.oo I $15.45 I $15.91 I $16.39 I $16.88 I Gross Ticket Revenue (000) $0 $0 $0 $0 $0 Facility Use Fee $0.00 0 0 0 0 0 Admissions Tax 0.0% 0 0 0 0 0 Net Ticket Revenue (000) $0 $0 $0 $0 $0

FacilityRent 10.0% $0 I $0 I $0 I $0 I $0 I Less: No Show Percentage 5.0% 5.0% 5.0% 5.0% 5.0% Add: Complimentary 5.0% 6.0% 7.0% 8.0% 9.0%

Concessions Actual Attendance 0.0 0.0 0.0 0.0 0.0 Per Capita - (1) $6.00 $6.18 $6.37 $6.56 $6.75 Gross Revenue (000) $0 $0 $0 $0 $0 Less: COGS/Operating Expenses 60.0% 0 0 0 0 0 Net Concession Revenue (000) $0 $0 $0 $0 $0 Less: Distribution to Tenant 0.0% 0 0 0 0 0 Net Concession Revenue (000) $0 $0 $0 $0 $0

Novelties Actual Attendance 0.0 0.0 0.0 0.0 0.0 Per Capita $1.50 $1.55 $1.59 $1.64 $1.69 Gross Revenue (000) $0 $0 $0 $0 $0 Less: COGS/Operating Expenses 75.0% 0 0 0 0 0 Net Novelty Revenue (000) $0 $0 $0 $0 $0 Less: Distribution to Tenant 100.0% 0 0 0 0 0 Net Novelty Revenue (000) $0 $0 $0 $0 $0

Parking Actual Attendance 0.0 0.0 0.0 0.0 0.0 Patrons Per Car 2.5 2.5 2.5 2.5 2.5 Rate Per Car $7.00 $7.21 $7.43 $7.65 $7.88 Gross Revenue (000) $0 $0 $0 $0 $0 Less: Parking Expenses 15.0% 0 0 0 0 0 Less: Parking Surcharge $0.00 0 0 0 0 0 Net Parking Revenue (000) $0 $0 $0 $0 $0 Less: Distribution to Tenant/Other 100.0% 0 0 0 0 0 Net Parking Revenue (000) $0 $0 $0 $0 $0

(1) - Assumes weighted average for generalsea ting, premium seating and catered foodand beverage sales.

Proposed Save Mart Center -Prepared b,tEc onomics Research Associates 1/16!)2 10:0SAM concerts-p 1 /16/02

Table 12 CONCERTS - POPULAR SAVE MART CENTER -BAS E CAS E Fiscal Year I 2004 I 2005 2006 I 2001 I 2008 I Tickets Games/Performances 3 1 3 1 3 Average Paid Attendance 7.6 7.6 7.6 7.6 7.6 Avg. Luxury Suite Attendance 0.4 0.4 0.4 0.4 0.4 Total Paid Attendance (000) 24.0 8.0 24.0 8.0 24.0 Average Ticket Price I $30.00 I $3o.9o I $31.83 I $32.n I $33.n I Gross Ticket Revenue (000) $720 $247 $764 $262 $810 Facility Use Fee $0.00 0 0 0 0 0 Admissions Tax 0.0% 0 0 0 0 0 Net Ticket Revenue (000) $720 $247 $764 $262 $810

FacilityRent 8.0% $58 I $20 I $61 $21 $65 I Less: No Show Percentage 2.5% 2.5% 2.5% 2.5% 2.5% Add: Complimentary 5.0% 5.0% 5.0% 5.0% 5.0%

Concessions Actual Attendance 24.6 8.2 24.6 8.2 24.6 Per Capita - (1) $6.00 $6.18 $6.37 $6.56 $6.75 Gross Revenue (000) $148 $51 $157 $54 $166 Less: COGS/Operating Expenses 60.0% 89 31 94 32 100 Net Concession Revenue (000) $59 $20 $63 $22 $66 Less: Distribution to Tenant 0.0% 0 0 0 0 0 Net Concession Revenue (000) $59 $20 $63 $22 $66

Novelties Actual Attendance 24.6 8.2 24.6 8.2 24.6 Per Capita $7.00 $7.21 $7.43 $7.65 $7.88 Gross Revenue (000) $172 $59 $183 $63 $194 Less: COGS/Operating Expenses 75.0% 129 44 137 47 146 Net Novelty Revenue (000) $43 $15 $46 $16 $49 Less: Distribution to Tenant 90.0% 39 13 41 14 44 Net Novelty Revenue (000) $4 $1 $5 $2 $5

Parking Actual Attendance 24.6 8.2 24.6 8.2 24.6 Patrons Per Car 2.5 2.5 2.5 2.5 2.5 Rate Per Car $7.00 $7.21 $7.43 $7.65 $7.88 Gross Revenue (000) $69 $24 $73 $25 $78 Less: Parking Expenses 15.0% 10 4 11 4 12 Less: Parking Surcharge $0.00 0 0 0 0 0 Net Parking Revenue (000) $59 $20 $62 $21 $66 Less: Distribution to Tenant/Other 100.0% 59 20 62 21 66 Net Parking Revenue (000) $0 $0 $0 $0 $0

(1) - Assumes weighted average forgener al seating, premium seating and catered foodand beverage sales.

Proposed Save Mart Center -Prepared b,tEc onomics Research Associates 1/16!)2 12:03 PM concerts-c 1 /16/02

Table 13 CONCERTS - COUNTRY SAVE MART CENTER -BAS E CASE Fiscal Year I 2004 I 2005 2006 I 2001 I 2008 I Tickets Ciames/Performances 3 1 3 1 3 Average Paid Attendance 9.6 9.6 9.6 9.6 9.6 Avg. Luxury Suite Attendance 0.4 0.4 0.4 0.4 0.4 Total Paid Attendance (000) 30.0 10.0 30.0 10.0 30.0 Average Ticket Price I $28.00 I $28.84 I $29.11 I $30.60 I $3 1.51 I Gross Ticket Revenue (000) $840 $288 $891 $306 $945 FacilityUse Fee $0.00 0 0 0 0 0 Admissions Tax 0.0% 0 0 0 0 0 Net Ticket Revenue $840 $288 $891 $306 $945

Facility Rent 8.0% $67 I $23 $71 $24 I $76 I No Show Percentage 2.5% 2.5% 2.5% 2.5% 2.5% Add: Complimentary 5.0% 5.0% 5.0% 5.0% 5.0%

Concessions Actual Attendance (000) 30.8 10.3 30.8 10.3 30.8 Per Capita - (1) $6.00 $6.18 $6.37 $6.56 $6.75 Gross Revenue (000) $185 $63 $196 $67 $208 Less: COGS/Operating Expenses 60.0% 111 38 118 40 125 Net Concession Revenue (000) $74 $25 $78 $27 $83 Less: Distribution to Tenant 0.0% 0 0 0 0 0 Net Concession Revenue (000) $74 $25 $78 $27 $83

Novelties Actual Attendance (000) 30.8 10.3 30.8 10.3 30.8 Per Capita $7.00 $7.21 $7.43 $7.65 $7.88 Gross Revenue (000) $215 $74 $228 $78 $242 Less: COGS/Operating Expenses 75.0% 161 55 171 59 182 Net Novelty Revenue (000) $54 $18 $57 $20 $61 Less: Distribution to Tenant 90.0% 48 17 51 18 55 Net NoveltyRevenue (000) $5 $2 $6 $2 $6

Parking Actual Attendance 30.8 10.3 30.8 10.3 30.8 Patrons Per Car 2.5 2.5 2.5 2.5 2.5 Rate Per Car $7.00 $7.21 $7.43 $7.65 $7.88 Gross Revenue (000) $86 $30 $91 $3 1 $97 Less Parking Expenses 15.0% 13 4 14 5 15 Less: Parking Surcharge $0.00 0 0 0 0 0 Net Parking Revenue (000) $73 $25 $78 $27 $82 Less: Distribution to Tenant/Other 100.0% 73 25 78 27 82 Net Parking Revenue (000) $0 $0 $0 $0 $0

(1) - Assumes weighted average forgeneral seating, premium seating and catered foodand beverage sales.

Proposed Save Mart Center -Prepared 0y Economics ResearchAssoci ates 1/16/02 10:06AM concerts-a 1 /16/02

Table 14 CONCERTS - ALTERNATIVE SAVE MART CENTER - BASE CAS E Fiscal Year I 2004 I 2005 2006 I 2001 I 2008 I Tickets Games/Performances 3 2 3 2 3 Average Paid Attendance 4.6 4.6 4.6 4.6 4.6 Avg. Luxury Suite Attendance 0.4 0.4 0.4 0.4 0.4 Total Paid Attendance (000) 15.0 10.0 15.0 10.0 15.0 Average Ticket Price I $25.oo I $25.75 I $26.52 I $21.32 I $28.14 I Gross Ticket Revenue (000) $375 $258 $398 $273 $422 Facility UseFee $0.00 0 0 0 0 0 Admissions Tax 0.0% 0 0 0 0 0 Net Ticket Revenue $375 $258 $398 $273 $422

Facility Rent 8.0% $3o I $21 $32 I $22 I $34 I No Show Percentage 2.5% 2.5% 2.5% 2.5% 2.5% Add: Complimentary 5.0% 5.0% 5.0% 5.0% 5.0%

Concessions Actual Attendance (000) 15.4 10.3 15.4 10.3 15.4 Per Capita - (1) $6.00 $6.18 $6.37 $6.56 $6.75 Gross Revenue (000) $92 $63 $98 $67 $104 Less: COGS/Operating Expenses 60.0% 55 38 59 40 62 Net Concession Revenue (000) $37 $25 $39 $27 $42 Less: Distribution to Tenant 0.0% 0 0 0 0 0 Net Concession Revenue (000) $37 $25 $39 $27 $42

Novelties Actual Attendance (000) 15.4 10.3 15.4 10.3 15.4 Per Capita $7.00 $7.21 $7.43 $7.65 $7.88 Gross Revenue (000) $108 $74 $1 14 $78 $121 Less: COGS/Operating Expenses 75.0% 81 55 86 59 91 Net Novelty Revenue (000) $27 $18 $29 $20 $30 Less: Distribution to Tenant 90.0% 24 17 26 18 27 Net Novelty Revenue (000) $3 $2 $3 $2 $3

Parking Actual Attendance 15.4 10.3 15.4 10.3 15.4 Patrons Per Car 2.5 2.5 2.5 2.5 2.5 Rate Per Car $7.00 $7.21 $7.43 $7.65 $7.88 Gross Revenue (000) $43 $30 $46 $31 $48 Less Parking Expenses 15.0% 6 4 7 5 7 Less: Parking Surcharge $0.00 0 0 0 0 0 Net Parking Revenue (000) $37 $25 $39 $27 $4 1 Less: Distribution to Tenant/Other 100.0% 37 25 39 27 41 Net Parking Revenue (000) $0 $0 $0 $0 $0

(1) - Assumes weighted average forgeneral seating, premium seating and catered foodand beverage sales.

Proposed Save Mart Center -Prepared b,tEc onomics Research Associates 1/16!)2 12:21 PM concerts-e 1 /1 6/02

Table 15 CONCERTS - ETHNIC SAVE MART CENTER - BASE CAS E Fiscal Year I 2004 I 2005 2006 I 2001 I 2008 I Tickets Games/Performances 4 3 4 3 4 Average Paid Attendance 4.6 4.6 4.6 4.6 4.6 Avg. Luxury Suite Attendance 0.4 0.4 0.4 0.4 0.4 Total Paid Attendance (000) 20.0 15.0 20.0 15.0 20.0 Average Ticket Price I $35.oo I $36.o5 I $37.13 I $38.25 I $39.39 I Gross Ticket Revenue (000) $700 $541 $743 $574 $788 Facility UseFee $0.00 0 0 0 0 0 Admissions Tax 0.0% 0 0 0 0 0 Net Ticket Revenue $700 $541 $743 $574 $788

Facility Rent 8.0% $56 I $43 $59 I $46 I $63 No Show Percentage 2.5% 2.5% 2.5% 2.5% 2.5% Add: Complimentary 5.0% 5.0% 5.0% 5.0% 5.0%

Concessions Actual Attendance (000) 20.5 15.4 20.5 15.4 20.5 Per Capita - (1) $6.00 $6.18 $6.37 $6.56 $6.75 Gross Revenue (000) $123 $95 $130 $101 $138 Less: COGS/Operating Expenses 60.0% 74 57 78 61 83 Net Concession Revenue (000) $49 $38 $52 $40 $55 Less: Distribution to Tenant 0.0% 0 0 0 0 0 Net Concession Revenue (000) $49 $38 $52 $40 $55

Novelties Actual Attendance (000) 20.5 15.4 20.5 15.4 20.5 Per Capita $7.00 $7.21 $7.43 $7.65 $7.88 Gross Revenue (000) $144 $111 $152 $118 $162 Less: COGS/Operating Expenses 75.0% 108 83 114 88 121 Net Novelty Revenue (000) $36 $28 $38 $29 $40 Less: Distribution to Tenant 90.0% 32 25 34 26 36 Net Novelty Revenue (000) $4 $3 $4 $3 $4

Parking Actual Attendance 20.5 15.4 20.5 15.4 20.5 Patrons Per Car 2.5 2.5 2.5 2.5 2.5 Rate Per Car $7.00 $7.21 $7.43 $7.65 $7.88 Gross Revenue (000) $57 $44 $61 $47 $65 Less Parking Expenses 15.0% 9 7 9 7 10 Less: Parking Surcharge $0.00 0 0 0 0 0 Net Parking Revenue (000) $49 $38 $52 $40 $55 Less: Distribution to Tenant/Other 100.0% 49 38 52 40 55 Net Parking Revenue (000) $0 $0 $0 $0 $0

(1) - Assumes weighted average forgeneral seating, premium seating and catered foodand beverage sales.

Proposed Save Mart Center -Prepared b,tEc onomics Research Associates 1/16!)2 12:21 PM motorsports 1 /16/02

Table 16 MOTORSPORTS SAVE MART CENTER - BASE CAS E Fiscal Year I 2004 I 2005 2006 I 2001 I 2008 I Tickets Games/Performances 1 1 1 1 1 Average Paid Attendance 9.6 9.6 9.2 8.7 8.3 Avg. Luxury Suite Attendance 0.4 0.4 0.4 0.4 0.4 Total Paid Attendance (000) 10.0 10.0 9.5 9. 1 8.6 Average Ticket Price I $15.oo I $15.45 I $15.91 I $16.39 I $16.88 I Gross Ticket Revenue (000) $150 $155 $151 $149 $146 Facility UseFee $0.00 0 0 0 0 0 Admissions Tax 0.0% 0 0 0 0 0 Net Ticket Revenue $150 $155 $151 $149 $146

Facility Rent 6.0% $9 I $9 I $9 I $9 I $9 I No Show Percentage 5.0% 5.0% 5.0% 5.0% 5.0% Add: Complimentary 10.0% 10.0% 10.0% 12.0% 12.0%

Concessions Actual Attendance (000) 10.5 10.5 10.0 9.7 9.2 Per Capita - (1) $6.00 $6.18 $6.37 $6.56 $6.75 Gross Revenue (000) $63 $65 $64 $64 $62 Less: COGS/Operating Expenses 60.0% 38 39 38 38 37 Net Concession Revenue (000) $25 $26 $26 $26 $25 Less: Distribution to Tenant 0.0% 0 0 0 0 0 Net Concession Revenue (000) $25 $26 $26 $26 $25

Novelties Actual Attendance (000) 10.5 10.5 10.0 9.7 9.2 Per Capita $2.00 $2.06 $2. 12 $2. 19 $2.25 Gross Revenue (000) $21 $22 $21 $21 $2 1 Less: COGS/Operating Expenses 75.0% 16 16 16 16 16 Net Novelty Revenue (000) $5 $5 $5 $5 $5 Less: Distribution to Tenant 90.0% 5 5 5 5 5 Net Novelty Revenue (000) $1 $1 $1 $1 $1

Parking Actual Attendance 10.5 10.5 10.0 9.7 9.2 Patrons Per Car 2.5 2.5 2.5 2.5 2.5 Rate Per Car $7.00 $7.21 $7.43 $7.65 $7.88 Gross Revenue (000) $29 $30 $30 $30 $29 Less Parking Expenses 15.0% 4 5 4 4 4 Less: Parking Surcharge $0.00 0 0 0 0 0 Net Parking Revenue (000) $25 $26 $25 $25 $25 Less: Distribution to Tenant/Other 100.0% 25 26 25 25 25 Net Parking Revenue (000) $0 $0 $0 $0 $0

(1) - Assumes weighted average forgeneral seating, premium seating and catered foodand beverage sales.

Proposed Save Mart Center -Prepared b,tEc onomics Research Associates 1/16!)2 12:21 PM rodeo 1 /1 6/02

Table 17 RODEO I BULL RIDING SAVE MART CENTER - BASE CAS E Fiscal Year I 2004 I 2005 2006 I 2001 I 2008 I Tickets Games/Performances 1 1 1 1 1 Average Paid Attendance 9.6 9.6 9.6 9.2 8.7 Avg. Luxury Suite Attendance 0.4 0.4 0.4 0.4 0.4 Total Paid Attendance (000) 10.0 10.0 10.0 9.5 9. 1 Average Ticket Price I $15.oo I $15.45 I $15.91 I $16.39 I $16.88 I Gross Ticket Revenue (000) $150 $155 $159 $156 $153 Facility UseFee $0.00 0 0 0 0 0 Admissions Tax 0.0% 0 0 0 0 0 Net Ticket Revenue $150 $155 $159 $156 $153

Facility Rent 8.0% $12 I $12 I $13 $12 I $12 I

No Show Percentage 5.0% 5.0% 5.0% 5.0% 5.0% Add: Complimentary 10.0% 10.0% 10.0% 10.0% 10.0%

Concessions Actual Attendance (000) 10.5 10.5 10.5 10.0 9.5 Per Capita - (1) $6.00 $6.18 $6.37 $6.56 $6.75 Gross Revenue (000) $63 $65 $67 $66 $64 Less: COGS/Operating Expenses 60.0% 38 39 40 40 38 Net Concession Revenue (000) $25 $26 $27 $26 $26 Less: Distribution to Tenant 0.0% 0 0 0 0 0 Net Concession Revenue (000) $25 $26 $27 $26 $26

Novelties Actual Attendance (000) 10.5 10.5 10.5 10.0 9.5 Per Capita $2.00 $2.06 $2. 12 $2. 19 $2.25 Gross Revenue (000) $21 $22 $22 $22 $2 1 Less: COGS/Operating Expenses 75.0% 16 16 17 16 16 Net Novelty Revenue (000) $5 $5 $6 $5 $5 Less: Distribution to Tenant 90.0% 5 5 5 5 5 Net Novelty Revenue (000) $1 $1 $1 $1 $1 Parking Actual Attendance 10.5 10.5 10.5 10.0 9.5 Patrons Per Car 2.5 2.5 2.5 2.5 2.5 Rate Per Car $7.00 $7.21 $7.43 $7.65 $7.88 Gross Revenue (000) $29 $30 $3 1 $3 1 $30 Less Parking Expenses 15.0% 4 5 5 5 4 Less: Parking Surcharge $0.00 0 0 0 0 0 Net Parking Revenue (000) $25 $26 $27 $26 $25 Less: Distribution to Tenant/Other 100.0% 25 26 27 26 25 Net Parking Revenue (000) $0 $0 $0 $0 $0

(1) - Assumes weighted average forgeneral seating, premium seating and catered foodand beverage sales.

Proposed Save Mart Center -Prepared b,tEc onomics Research Associates 1/16!)2 12:21 PM RollerJam 1 /16/02

Table 18 ROLLER JAM SAVE MART CENTER - BASE CAS E Fiscal Year I 2004 I 2005 2006 I 2001 I 2008 I Tickets Games/Performances 1 1 1 1 1 Average Paid Attendance 7.2 7.2 7.2 6.8 6.8 Avg. Luxury Suite Attendance 0.3 0.3 0.3 0.3 0.3 Total Paid Attendance (000) 7.5 7.5 7.5 7.1 7.1 Average Ticket Price I $15.oo I $15.45 I $15.91 I $16.39 I $16.88 I Gross Ticket Revenue (000) $113 $116 $1 19 $117 $121 Facility UseFee $0.00 0 0 0 0 0 Admissions Tax 0.0% 0 0 0 0 0 Net Ticket Revenue 113 116 119 117 121

Facility Rent 8.0% $9 I $9 I $10 I $9 I $10 I No Show Percentage 5.0% 5.0% 5.0% 5.0% 5.0% Add: Complimentary 10.0% 10.0% 10.0% 10.0% 10.0%

Concessions Actual Attendance (000) 7.9 7.9 7.9 7.5 7.5 Per Capita - (1) $6.00 $6.18 $6.37 $6.56 $6.75 Gross Revenue (000) $47 $49 $50 $49 $51 Less: COGS/Operating Expenses 60.0% 28 29 30 29 31 Net Concession Revenue (000) $19 $20 $20 $20 $20 Less: Distribution to Tenant 0.0% 0 0 0 0 0 Net Concession Revenue (000) $19 $20 $20 $20 $20

Novelties Actual Attendance (000) 7.9 7.9 7.9 7.5 7.5 Per Capita $2.00 $2.06 $2. 12 $2. 19 $2.25 Gross Revenue (000) $16 $16 $17 $16 $17 Less: COGS/Operating Expenses 75.0% 12 12 13 12 13 Net Novelty Revenue (000) $4 $4 $4 $4 $4 Less: Distribution to Tenant 90.0% 4 4 4 4 4 Net Novelty Revenue (000) $0 $0 $0 $0 $0

Parking Actual Attendance 7.9 7.9 7.9 7.5 7.5 Patrons Per Car 2.5 2.5 2.5 2.5 2.5 Rate Per Car $7.00 $7.21 $7.43 $7.65 $7.88 Gross Revenue (000) $22 $23 $23 $23 $24 Less Parking Expenses 15.0% 3 3 4 3 4 Less: Parking Surcharge $0.00 0 0 0 0 0 Net Parking Revenue (000) $19 $19 $20 $19 $20 Less: Distribution to Tenant/Other 100.0% 19 19 20 19 20 Net Parking Revenue (000) $0 $0 $0 $0 $0

(1) - Assumes weighted average forgeneral seating, premium seating and catered foodand beverage sales.

Proposed Save Mart Center -Prepared b,tEc onomics Research Associates 1/16!)2 12:21 PM Family Sh-A 1 /1 6/02

Table 19 FAMILY SHOWS -A SAVE MART CENTER - BASE CAS E Fiscal Year I 2004 I 2005 2006 I 2001 I 2008 I Tickets Games/Performances 7 6 6 5 5 Average Paid Attendance 4.4 4.4 4.4 4.4 4.4 Avg. Luxury Suite Attendance 0. 1 0.1 0.1 0.1 0.1 Total Paid Attendance (000) 31.5 27.0 27.0 22.5 22.5 Average Ticket Price I $16.00 I $16.48 I $16.97 I $17.48 I $18.01 I Gross Ticket Revenue (000) $504 $445 $458 $393 $405 Facility UseFee $0.00 0 0 0 0 0 Admissions Tax 0.0% 0 0 0 0 0 Net Ticket Revenue $504 $445 $458 $393 $405

Facility Rent 5.0% $25 I $22 I $23 $20 I $20 I

No Show Percentage 10.0% 10.0% 10.0% 10.0% 10.0% Add: Complimentary 15.0% 15.0% 15.0% 15.0% 15.0%

Concessions Actual Attendance (000) 33.1 28.4 28.4 23.6 23.6 Per Capita - (1) $6.00 $6.18 $6.37 $6.56 $6.75 Gross Revenue (000) $198 $175 $180 $155 $160 Less: COGS/Operating Expenses 60.0% 119 105 108 93 96 Net Concession Revenue (000) $79 $70 $72 $62 $64 Less: Distribution to Tenant 0.0% 0 0 0 0 0 Net Concession Revenue (000) $79 $70 $72 $62 $64

Novelties Actual Attendance (000) 33.1 28.4 28.4 23.6 23.6 Per Capita $7.00 $7.21 $7.43 $7.65 $7.88 Gross Revenue (000) $232 $204 $2 11 $181 $186 Less: COGS/Operating Expenses 75.0% 174 153 158 136 140 Net Novelty Revenue (000) $58 $51 $53 $45 $47 Less: Distribution to Tenant 100.0% 58 51 53 45 47 Net Novelty Revenue (000) $0 $0 $0 $0 $0

Parking Actual Attendance 33.1 28.4 28.4 23.6 23.6 Patrons Per Car 3.5 3.5 3.5 3.5 3.5 Rate Per Car $7.00 $7.21 $7.43 $7.65 $7.88 Gross Revenue (000) $66 $58 $60 $52 $53 Less Parking Expenses 15.0% 10 9 9 8 8 Less: Parking Surcharge $0.00 0 0 0 0 0 Net Parking Revenue (000) $56 $50 $51 $44 $45 Less: Distribution to Tenant/Other 100.0% 56 50 51 44 45 Net Parking Revenue (000) $0 $0 $0 $0 $0

(1) - Assumes weighted average forgeneral seating, premium seating and catered foodand beverage sales.

Proposed Save Mart Center -Prepared b,tEc onomics Research Associates 1/16!)2 12:21 PM FamilySh-B 1 /1 6/02

Table 20 FAMILY SHOWS -B SAVE MART CENTER - BASE CAS E Fiscal Year I 2004 I 2005 2006 I 2001 I 2008 I Tickets Games/Performances 4 5 5 6 6 Average Paid Attendance 3.4 3.4 3.4 3.4 3.4 Avg. Luxury Suite Attendance 0. 1 0.1 0.1 0.1 0.1 Total Paid Attendance (000) 14.0 17.5 17.5 21.0 21.0 Average Ticket Price I $14.oo I $14.42 I $14.85 I $15.30 I $15.76 I Gross Ticket Revenue (000) $196 $252 $260 $321 $33 1 Facility UseFee $0.00 0 0 0 0 0 Admissions Tax 0.0% 0 0 0 0 0 Net Ticket Revenue $196 $252 $260 $321 $33 1

Facility Rent 8.0% $16 I $20 I $21 $26 I $26 I

No Show Percentage 10.0% 10.0% 10.0% 10.0% 10.0% Add: Complimentary 15.0% 15.0% 15.0% 15.0% 15.0%

Concessions Actual Attendance (000) 14.7 18.4 18.4 22.1 22.1 Per Capita - (1) $6.00 $6.18 $6.37 $6.56 $6.75 Gross Revenue (000) $88 $114 $1 17 $145 $149 Less: COGS/Operating Expenses 60.0% 53 68 70 87 89 Net Concession Revenue (000) $35 $46 $47 $58 $60 Less: Distribution to Tenant 0.0% 0 0 0 0 0 Net Concession Revenue (000) $35 $46 $47 $58 $60

Novelties Actual Attendance (000) 14.7 18.4 18.4 22.1 22.1 Per Capita $7.00 $7.21 $7.43 $7.65 $7.88 Gross Revenue (000) $103 $132 $136 $169 $174 Less: COGS/Operating Expenses 75.0% 77 99 102 126 130 Net Novelty Revenue (000) $26 $33 $34 $42 $43 Less: Distribution to Tenant 100.0% 26 33 34 42 43 Net Novelty Revenue (000) $0 $0 $0 $0 $0

Parking Actual Attendance 14.7 18.4 18.4 22.1 22.1 Patrons Per Car 3.5 3.5 3.5 3.5 3.5 Rate Per Car $7.00 $7.21 $7.43 $7.65 $7.88 Gross Revenue (000) $29 $38 $39 $48 $50 Less Parking Expenses 15.0% 4 6 6 7 7 Less: Parking Surcharge $0.00 0 0 0 0 0 Net Parking Revenue (000) $25 $32 $33 $41 $42 Less: Distribution to Tenant/Other 100.0% 25 32 33 41 42 Net Parking Revenue (000) $0 $0 $0 $0 $0

(1) - Assumes weighted average forgeneral seating, premium seating and catered foodand beverage sales.

Proposed Save Mart Center -Prepared b,tEc onomics Research Associates 1/16!)2 12:21 PM NCAA 1 /1 6/02

Table 21 NCAA EVENTS SAVE MART CENTER - BASE CAS E Fiscal Year I 2004 I 2005 2006 I 2001 I 2008 I Tickets Games/Performances 0 0 3 0 0 Average Paid Attendance 14.6 14.6 14.6 14.6 14.6 Avg. Luxury Suite Attendance 0.4 0.4 0.4 0.4 0.4 Total Paid Attendance (000) 0.0 0.0 45.0 0.0 0.0 Average Ticket Price I $20.00 I $20.60 I $21 .22 I $2 1.85 I $22.51 I Gross Ticket Revenue (000) $0 $0 $955 $0 $0 Facility UseFee $0.00 0 0 0 0 0 Admissions Tax 0.0% 0 0 0 0 0 Net Ticket Revenue $0 $0 $955 $0 $0

Facility Rent 10.0% $0 I $0 I $96 I $0 I $0 I No Show Percentage 2.5% 2.5% 2.5% 2.5% 2.5% Add: Complimentary 5.0% 5.0% 5.0% 5.0% 5.0%

Concessions Actual Attendance (000) 0.0 0.0 46.1 0.0 0.0 Per Capita - (1) $8.00 $8.24 $8.49 $8.74 $9.00 Gross Revenue (000) $0 $0 $391 $0 $0 Less: COGS/Operating Expenses 60.0% 0 0 235 0 0 Net Concession Revenue (000) $0 $0 $156 $0 $0 Less: Distribution to Tenant 0.0% 0 0 0 0 0 Net Concession Revenue (000) $0 $0 $156 $0 $0

Novelties Actual Attendance (000) 0.0 0.0 46.1 0.0 0.0 Per Capita $3.00 $3.09 $3.18 $3.28 $3.38 Gross Revenue (000) $0 $0 $147 $0 $0 Less: COGS/Operating Expenses 75.0% 0 0 110 0 0 Net Novelty Revenue (000) $0 $0 $37 $0 $0 Less: Distribution to Tenant 100.0% 0 0 37 0 0 Net Novelty Revenue (000) $0 $0 $0 $0 $0

Parking Actual Attendance 0.0 0.0 46.1 0.0 0.0 Patrons Per Car 2.5 2.5 2.5 2.5 2.5 Rate Per Car $7.00 $7.21 $7.43 $7.65 $7.88 Gross Revenue (000) $0 $0 $137 $0 $0 Less Parking Expenses 15.0% 0 0 21 0 0 Less: Parking Surcharge $0.00 0 0 0 0 0 Net Parking Revenue (000) $0 $0 $1 16 $0 $0 Less: Distribution to Tenant/Other 100.0% 0 0 116 0 0 Net Parking Revenue (000) $0 $0 $0 $0 $0

(1) - Assumes weighted average forgeneral seating, premium seating and catered foodand beverage sales.

Proposed Save Mart Center -Prepared b,tEc onomics Research Associates 1/16!)2 12:21 PM WAC 1 /16/02

Table 22 WAC EVENTS SAVE MART CENTER - BASE CAS E Fiscal Year I 2004 I 2005 2006 I 2001 I 2008 I Tickets Games/Performances 0 3 0 3 0 Average Paid Attendance 14.6 14.6 14.6 14.6 14.6 Avg. Luxury Suite Attendance 0.4 0.4 0.4 0.4 0.4 Total Paid Attendance (000) 0.0 45.0 0.0 45.0 0.0 Average Ticket Price I $15.oo I $15.45 I $15.91 I $16.39 I $16.88 I Gross Ticket Revenue (000) $0 $695 $0 $738 $0 Facility UseFee $0.00 0 0 0 0 0 Admissions Tax 0.0% 0 0 0 0 0 Net Ticket Revenue $0 $695 $0 $738 $0

Facility Rent 10.0% $0 I $10 I $0 I $74 I $0 I No Show Percentage 2.5% 2.5% 2.5% 2.5% 2.5% Add: Complimentary 5.0% 5.0% 5.0% 5.0% 5.0%

Concessions Actual Attendance (000) 0.0 46.1 0.0 46.1 0.0 Per Capita - (1) $8.00 $8.24 $8.49 $8.74 $9.00 Gross Revenue (000) $0 $380 $0 $403 $0 Less: COGS/Operating Expenses 60.0% 0 228 0 242 0 Net Concession Revenue (000) $0 $152 $0 $161 $0 Less: Distribution to Tenant 0.0% 0 0 0 0 0 Net Concession Revenue (000) $0 $152 $0 $161 $0

Novelties Actual Attendance (000) 0.0 46.1 0.0 46.1 0.0 Per Capita $3.00 $3.09 $3.18 $3.28 $3.38 Gross Revenue (000) $0 $143 $0 $151 $0 Less: COGS/Operating Expenses 75.0% 0 107 0 113 0 Net Novelty Revenue (000) $0 $36 $0 $38 $0 Less: Distribution to Tenant 100.0% 0 36 0 38 0 Net Novelty Revenue (000) $0 $0 $0 $0 $0

Parking Actual Attendance 0.0 46.1 0.0 46.1 0.0 Patrons Per Car 2.5 2.5 2.5 2.5 2.5 Rate Per Car $7.00 $7.21 $7.43 $7.65 $7.88 Gross Revenue (000) $0 $133 $0 $141 $0 Less Parking Expenses 15.0% 0 20 0 21 0 Less: Parking Surcharge $0.00 0 0 0 0 0 Net Parking Revenue (000) $0 $113 $0 $120 $0 Less: Distribution to Tenant/Other 100.0% 0 113 0 120 0 Net Parking Revenue (000) $0 $0 $0 $0 $0

(1) - Assumes weighted average forgeneral seating, premium seating and catered foodand beverage sales.

Proposed Save Mart Center -Prepared b,tEc onomics Research Associates 1/16!)2 12:21 PM Tennis 1 /1 6/02

Table 23 TENNIS SAVE MART CENTER - BASE CAS E Fiscal Year I 2004 I 2005 2006 I 2001 I 2008 I Tickets Games/Performances 2 2 2 2 2 Average Paid Attendance 4.9 4.9 4.9 4.9 4.9 Avg. Luxury Suite Attendance 0. 1 0.1 0.1 0.1 0.1 Total Paid Attendance (000) 10.0 10.0 10.0 10.0 10.0 Average Ticket Price I $25.oo I $25.75 I $26.52 I $21.32 I $28.14 I Gross Ticket Revenue (000) $250 $258 $265 $273 $281 Facility UseFee $0.00 0 0 0 0 0 Admissions Tax 0.0% 0 0 0 0 0 Net Ticket Revenue $250 $258 $265 $273 $281

Facility Rent 10.0% $25 I $26 I $21 I $21 I $28 I No Show Percentage 10.0% 10.0% 10.0% 10.0% 10.0% Add: Complimentary 25.0% 25.0% 25.0% 25.0% 25.0%

Concessions Actual Attendance (000) 11.5 11.5 11.5 11.5 11.5 Per Capita - (1) $4.00 $4.12 $4.24 $4.37 $4.50 Gross Revenue (000) $46 $47 $49 $50 $52 Less: COGS/Operating Expenses 60.0% 28 28 29 30 31 Net Concession Revenue (000) $18 $19 $20 $20 $2 1 Less: Distribution to Tenant 0.0% 0 0 0 0 0 Net Concession Revenue (000) $18 $19 $20 $20 $2 1

Novelties Actual Attendance (000) 11.5 11.5 11.5 11.5 11.5 Per Capita $1.00 $1.03 $1.06 $1.09 $1.13 Gross Revenue (000) $12 $12 $12 $13 $13 Less: COGS/Operating Expenses 75.0% 9 9 9 9 10 Net Novelty Revenue (000) $3 $3 $3 $3 $3 Less: Distribution to Tenant 90.0% 3 3 3 3 3 Net Novelty Revenue (000) $0 $0 $0 $0 $0

Parking Actual Attendance 11.5 11.5 11.5 11.5 11.5 Patrons Per Car 2.5 2.5 2.5 2.5 2.5 Rate Per Car $4.00 $4.12 $4.24 $4.37 $4.50 Gross Revenue (000) $18 $19 $20 $20 $2 1 Less Parking Expenses 15.0% 3 3 3 3 3 Less: Parking Surcharge $0.00 0 0 0 0 0 Net Parking Revenue (000) $16 $16 $17 $17 $18 Less: Distribution to Tenant/Other 100.0% 16 16 17 17 18 Net Parking Revenue (000) $0 $0 $0 $0 $0

(1) - Assumes weighted average forgeneral seating, premium seating and catered foodand beverage sales.

Proposed Save Mart Center -Prepared b,tEc onomics Research Associates 1/16!)2 12:21 PM Int'! VB 1 /1 6/02

Table 24 INTERNATIONAL VOLLEYBALL SAVE MART CENTER - BASE CAS E Fiscal Year I 2004 I 2005 2006 I 2001 I 2oos I Tickets Games/Performances 1 1 1 1 1 Average Paid Attendance 2.0 2.0 2.0 2.0 2.0 Avg. Luxury Suite Attendance 0.0 0.0 0.0 0.0 0.0 Total Paid Attendance (000) 2.0 2.0 2.0 2.0 2.0 Average Ticket Price I $12.00 I $12.36 I $12.13 I $13.11 I $13.51 I Gross Ticket Revenue (000) $24 $25 $25 $26 $27 Facility UseFee $0.00 0 0 0 0 0 Admissions Tax 0.0% 0 0 0 0 0 Net Ticket Revenue $24 $25 $25 $26 $27

Facility Rent 10.0% $2 I $3 $3 $3 $3

No Show Percentage 10.0% 10.0% 10.0% 10.0% 10.0% Add: Complimentary 20.0% 20.0% 20.0% 20.0% 20.0%

Concessions Actual Attendance (000) 2.2 2.2 2.2 2.2 2.2 Per Capita - (1) $4.00 $4.12 $4.24 $4.37 $4.50 Gross Revenue (000) $9 $9 $9 $10 $10 Less: COGS/Operating Expenses 60.0% 5 5 5 6 6 Net Concession Revenue (000) $4 $4 $4 $4 $4 Less: Distribution to Tenant 0.0% 0 0 0 0 0 Net Concession Revenue (000) $4 $4 $4 $4 $4

Novelties Actual Attendance (000) 2.2 2.2 2.2 2.2 2.2 Per Capita $1.00 $1.03 $1.06 $1.09 $1.13 Gross Revenue (000) $2 $2 $2 $2 $2 Less: COGS/Operating Expenses 75.0% 2 2 2 2 2 Net Novelty Revenue (000) $1 $1 $1 $1 $1 Less: Distribution to Tenant 90.0% 0 1 1 1 1 Net Novelty Revenue (000) $0 $0 $0 $0 $0

Parking Actual Attendance 2.2 2.2 2.2 2.2 2.2 Patrons Per Car 2.5 2.5 2.5 2.5 2.5 Rate Per Car $4.00 $4.12 $4.24 $4.37 $4.50 Gross Revenue (000) $4 $4 $4 $4 $4 Less Parking Expenses 15.0% 1 1 1 1 1 Less: Parking Surcharge $0.00 0 0 0 0 0 Net Parking Revenue (000) $3 $3 $3 $3 $3 Less: Distribution to Tenant/Other 100.0% 3 3 3 3 3 Net Parking Revenue (000) $0 $0 $0 $0 $0

(1) - Assumes weighted average forgeneral seating, premium seating and catered foodand beverage sales.

Proposed Save Mart Center -Prepared b,tEc onomics Research Associates 1/16!)2 12:21 PM NBA 1 /16/02

Table 25 NBA EXHIBITION SAVE MART CENTER - BASE CAS E Fiscal Year I 2004 I 2005 2006 I 2001 I 2008 I Tickets Games/Performances 0 1 0 1 0 Average Paid Attendance 14.6 14.6 14.6 14.6 14.6 Avg. Luxury Suite Attendance 0.4 0.4 0.4 0.4 0.4 Total Paid Attendance (000) 0.0 15.0 0.0 15.0 0.0 Average Ticket Price I $30.00 I $3o.9o I $3 1.83 I $32.18 I $33.77 I Gross Ticket Revenue (000) $0 $464 $0 $492 $0 Facility UseFee $0.00 0 0 0 0 0 Admissions Tax 0.0% 0 0 0 0 0 Net Ticket Revenue $0 $464 $0 $492 $0

Facility Rent 5.0% $0 I $23 $0 I $25 $0 I No Show Percentage 2.5% 2.5% 2.5% 2.5% 2.5% Add: Complimentary 2.5% 2.5% 2.5% 2.5% 2.5%

Concessions Actual Attendance (000) 0.0 15.0 0.0 15.0 0.0 Per Capita - (1) $6.00 $6.18 $6.37 $6.56 $6.75 Gross Revenue (000) $0 $93 $0 $98 $0 Less: COGS/Operating Expenses 60.0% 0 56 0 59 0 Net Concession Revenue (000) $0 $37 $0 $39 $0 Less: Distribution to Tenant 0.0% 0 0 0 0 0 Net Concession Revenue (000) $0 $37 $0 $39 $0

Novelties Actual Attendance (000) 0.0 15.0 0.0 15.0 0.0 Per Capita $5.00 $5.15 $5.30 $5.46 $5.63 Gross Revenue (000) $0 $77 $0 $82 $0 Less: COGS/Operating Expenses 75.0% 0 58 0 61 0 Net Novelty Revenue (000) $0 $19 $0 $20 $0 Less: Distribution to Tenant 100.0% 0 19 0 20 0 Net Novelty Revenue (000) $0 $0 $0 $0 $0

Parking Actual Attendance 0.0 15.0 0.0 15.0 0.0 Patrons Per Car 2.5 2.5 2.5 2.5 2.5 Rate Per Car $7.00 $7.21 $7.43 $7.65 $7.88 Gross Revenue (000) $0 $43 $0 $46 $0 Less Parking Expenses 15.0% 0 6 0 7 0 Less: Parking Surcharge $0.00 0 0 0 0 0 Net Parking Revenue (000) $0 $37 $0 $39 $0 Less: Distribution to Tenant/Other 100.0% 0 37 0 39 0 Net Parking Revenue (000) $0 $0 $0 $0 $0

(1) - Assumes weighted average forgeneral seating, premium seating and catered foodand beverage sales.

Proposed Save Mart Center -Prepared b,tEc onomics Research Associates 1/16!)2 12:21 PM Gymnast 1 /16/02

Table 26 GYMNASTICS SAVE MART CENTER - BASE CAS E Fiscal Year I 2004 I 2005 2006 I 2001 I 2008 I Tickets Games/Performances 0 0 2 0 1 Average Paid Attendance 3.0 3.0 3.0 3.0 3.0 Avg. Luxury Suite Attendance 0.0 0.0 0.0 0.0 0.0 Total Paid Attendance (000) 0.0 0.0 6.0 0.0 3.0 Average Ticket Price I $12.00 I $12.36 I $12.13 I $13.11 I $13.51 I Gross Ticket Revenue (000) $0 $0 $76 $0 $41 Facility UseFee $0.00 0 0 0 0 0 Admissions Tax 0.0% 0 0 0 0 0 Net Ticket Revenue $0 $0 $76 $0 $41

Facility Rent 10.0% $0 I $0 I $8 I $0 I $4 I No Show Percentage 10.0% 10.0% 10.0% 10.0% 10.0% Add: Complimentary 15.0% 15.0% 15.0% 15.0% 15.0%

Concessions Actual Attendance (000) 0.0 0.0 6.3 0.0 3.2 Per Capita - (1) $6.00 $6.18 $6.37 $6.56 $6.75 Gross Revenue (000) $0 $0 $40 $0 $2 1 Less: COGS/Operating Expenses 60.0% 0 0 24 0 13 Net Concession Revenue (000) $0 $0 $16 $0 $8 Less: Distribution to Tenant 0.0% 0 0 0 0 0 Net Concession Revenue (000) $0 $0 $16 $0 $8

Novelties Actual Attendance (000) 0.0 0.0 6.3 0.0 3.2 Per Capita $1.00 $1.03 $1.06 $1.09 $1.13 Gross Revenue (000) $0 $0 $7 $0 $4 Less: COGS/Operating Expenses 75.0% 0 0 5 0 3 Net Novelty Revenue (000) $0 $0 $2 $0 $1 Less: Distribution to Tenant 90.0% 0 0 2 0 1 Net Novelty Revenue (000) $0 $0 $0 $0 $0

Parking Actual Attendance 0.0 0.0 6.3 0.0 3.2 Patrons Per Car 2.5 2.5 2.5 2.5 2.5 Rate Per Car $4.00 $4.12 $4.24 $4.37 $4.50 Gross Revenue (000) $0 $0 $11 $0 $6 Less Parking Expenses 15.0% 0 0 2 0 1 Less: Parking Surcharge $0.00 0 0 0 0 0 Net Parking Revenue (000) $0 $0 $9 $0 $5 Less: Distribution to Tenant/Other 100.0% 0 0 9 0 5 Net Parking Revenue (000) $0 $0 $0 $0 $0

(1) - Assumes weighted average forgeneral seating, premium seating and catered foodand beverage sales.

Proposed Save Mart Center -Prepared b,tEc onomics Research Associates 1/16!)2 12:21 PM Wrest 1 /16/02

Table 27 WRESTLING SAVE MART CENTER - BASE CAS E Fiscal Year I 2004 I 2005 I 2006 I 2001 I 2008 I Tickets Games/Performances 3 3 3 3 3 Average Paid Attendance 13.6 13.6 12.9 12.9 12.3 Avg. Luxury Suite Attendance 0.4 0.4 0.4 0.4 0.4 Total Paid Attendance (000) 42.0 42.0 40.0 40.0 38.0 Average Ticket Price I $30.00 I $3o.9o I $3 1.83 I $32.18 I $33.n I Gross Ticket Revenue (000) $1,260 $1,298 $1,272 $1,3 10 $1,284 Facility UseFee $0.00 0 0 0 0 0 Admissions Tax 0.0% 0 0 0 0 0 Net Ticket Revenue $1,260 $1,298 $1,272 $1,3 10 $1,284 Facility Rent 8.0% $101 $104 I $101 I $110 I $113 I No Show Percentage 2.5% 2.5% 2.5% 2.5% 2.5% Add: Complimentary 5.0% 5.0% 5.0% 5.0% 5.0%

Concessions Actual Attendance (000) 43.1 43.1 41.0 41.0 39.0 Per Capita - (1) $6.00 $6.18 $6.37 $6.56 $6.75 Gross Revenue (000) $258 $266 $261 $269 $263 Less: COGS/Operating Expenses 60.0% 155 160 157 161 158 Net Concession Revenue (000) $103 $106 $104 $108 $105 Less: Distribution to Tenant 0.0% 0 0 0 0 0 Net Concession Revenue (000) $103 $106 $104 $108 $105

Novelties Actual Attendance (000) 43.1 43.1 41.0 41.0 39.0 Per Capita $1.00 $1.03 $1.06 $1.09 $1.13 Gross Revenue (000) $43 $44 $43 $45 $44 Less: COGS/Operating Expenses 75.0% 32 33 33 34 33 Net Novelty Revenue (000) $11 $11 $11 $11 $1 1 Less: Distribution to Tenant 90.0% 10 10 10 10 10 Net Novelty Revenue (000) $1 $1 $1 $1 $1

Parking Actual Attendance 43.1 43.1 41.0 41.0 39.0 Patrons Per Car 2.5 2.5 2.5 2.5 2.5 Rate Per Car $7.00 $7.21 $7.43 $7.65 $7.88 Gross Revenue (000) $121 $124 $122 $125 $123 Less Parking Expenses 15.0% 18 19 18 19 18 Less: Parking Surcharge $0.00 0 0 0 0 0 Net Parking Revenue (000) $102 $106 $103 $107 $104 Less: Distribution to Tenant/Other 100.0% 102 106 103 107 104 Net Parking Revenue (000) $0 $0 $0 $0 $0

(1) - Assumes weighted average forgeneral seating, premium seating and catered foodand beverage sales.

Proposed Save Mart Center -Prepared b,tEc onomics Research Associates 1/16!)2 12:21 PM HS Champ 1 /1 6/02

Table 28 HIGH SCHOOL CHAMPIONSHIPS SAVE MART CENTER - BASE CAS E Fiscal Year I 2004 I 2005 2006 I 2001 I 2008 I Tickets Games/Performances 3 3 3 3 3 Average Paid Attendance 4.9 4.9 4.9 4.9 4.9 Avg. Luxury Suite Attendance 0. 1 0.1 0.1 0.1 0.1 Total Paid Attendance (000) 15.0 15.0 15.0 15.0 15.0

Average Ticket Price $6.oo I $6.18 I $6.37 I $6.56 I $6.75 I Gross Ticket Revenue (000) $90 $93 $95 $98 $101 Facility UseFee $0.00 0 0 0 0 0 Admissions Tax 0.0% 0 0 0 0 0 Net Ticket Revenue $90 $93 $95 $98 $101

Facility Rent 10.0% $9 I $9 I $10 I $10 I $10 I No Show Percentage 5.0% 5.0% 5.0% 5.0% 5.0% Add: Complimentary 15.0% 15.0% 15.0% 15.0% 15.0%

Concessions Actual Attendance (000) 16.5 16.5 16.5 16.5 16.5 Per Capita - (1) $3.00 $3.09 $3.18 $3.28 $3.38 Gross Revenue (000) $50 $51 $53 $54 $56 Less: COGS/Operating Expenses 60.0% 30 31 32 32 34 Net Concession Revenue (000) $20 $20 $21 $22 $22 Less: Distribution to Tenant 0.0% 0 0 0 0 0 Net Concession Revenue (000) $20 $20 $21 $22 $22

Novelties Actual Attendance (000) 16.5 16.5 16.5 16.5 16.5 Per Capita $0.75 $0.77 $0.80 $0.82 $0.84 Gross Revenue (000) $12 $13 $13 $14 $14 Less: COGS/Operating Expenses 75.0% 9 10 10 10 10 Net Novelty Revenue (000) $3 $3 $3 $3 $3 Less: Distribution to Tenant 100.0% 3 3 3 3 3 Net Novelty Revenue (000) $0 $0 $0 $0 $0

Parking Actual Attendance 16.5 16.5 16.5 16.5 16.5 Patrons Per Car 2.5 2.5 2.5 2.5 2.5 Rate Per Car $4.00 $4.12 $4.24 $4.37 $4.50 Gross Revenue (000) $26 $27 $28 $29 $30 Less Parking Expenses 15.0% 4 4 4 4 4 Less: Parking Surcharge $0.00 0 0 0 0 0 Net Parking Revenue (000) $22 $23 $24 $25 $25 Less: Distribution to Tenant/Other 100.0% 22 23 24 25 25 Net Parking Revenue (000) $0 $0 $0 $0 $0

(1) - Assumes weighted average forgeneral seating, premium seating and catered foodand beverage sales.

Proposed Save Mart Center -Prepared b,tEc onomics Research Associates 1/16!)2 12:21 PM Other Misc Events 1 /1 6/02

Table 29 OTHER MISCELLANEOUS EVENTS SAVE MART CENTER - BASE CAS E Fiscal Year I 2004 I 2005 2006 I 2001 I 2008 I Tickets Games/Performances 2 2 2 2 2 Average Paid Attendance 2.5 2.5 2.5 2.5 2.5 Avg. Luxury Suite Attendance 0.0 0.0 0.0 0.0 0.0 Total Paid Attendance (000) 5.0 5.0 5.0 5.0 5.0

Average Ticket Price $6.oo I $6.18 I $6.37 I $6.56 I $6.75 I Gross Ticket Revenue (000) $30 $31 $32 $33 $34 Facility UseFee $0.00 0 0 0 0 0 Admissions Tax 0.00% 0 0 0 0 0 Net Ticket Revenue $30 $31 $32 $33 $34

Facility Rent 10.00% $3 $3 $3 $3 $3

No Show Percentage 5.0% 5.0% 5.0% 5.0% 5.0% Add: Complimentary 15.0% 15.0% 15.0% 15.0% 15.0%

Concessions Actual Attendance (000) 5.5 5.5 5.5 5.5 5.5 Per Capita - (1) $3.00 $3.09 $3.18 $3.28 $3.38 Gross Revenue (000) $17 $17 $18 $18 $19 Less: COGS/Operating Expenses 60.0% 10 10 11 11 11 Net Concession Revenue (000) $7 $7 $7 $7 $8 Less: Distribution to Tenant 0.0% 0 0 0 0 0 Net Concession Revenue (000) $7 $7 $7 $7 $8

Novelties Actual Attendance (000) 5.5 5.5 5.5 5.5 5.5 Per Capita $0.75 $0.77 $0.80 $0.82 $0.84 Gross Revenue (000) $4 $4 $4 $5 $5 Less: COGS/Operating Expenses 75.0% 3 3 3 3 3 Net Novelty Revenue (000) $1 $1 $1 $1 $1 Less: Distribution to Tenant 90.0% 1 1 1 1 1 Net Novelty Revenue (000) $0 $0 $0 $0 $0

Parking Actual Attendance 5.5 5.5 5.5 5.5 5.5 Patrons Per Car 2.5 2.5 2.5 2.5 2.5 Rate Per Car $4.00 $4.12 $4.24 $4.37 $4.50 Gross Revenue (000) $9 $9 $9 $10 $10 Less Parking Expenses 15.0% 1 1 1 1 1 Less: Parking Surcharge $0.00 0 0 0 0 0 Net Parking Revenue (000) $7 $8 $8 $8 $8 Less: Distribution to Tenant/Other 100.0% 7 8 8 8 8 Net Parking Revenue (000) $0 $0 $0 $0 $0

(1) - Assumes weighted average forgeneral seating, premium seating and catered foodand beverage sales.

Proposed Save Mart Center -Prepared b,tEc onomics Research Associates 1/16!)2 12:21 PM MAJOR OPERATING ASSUMPTIONS SAVE MART CENTER - BASE CASE Revenue Summaries & Assumptions 1 /1 6;02

Table 30 ASSUMPTIONS- TOTAL EVENTS SAVE MART CENTER - BASE CASE

Fiscal Year Sensitivity 2004 I 2005 I 2006 I 2007 I 2oos I Fresno State Athletics Factor Fresno State's Men's Basketball 1.00 19 19 19 19 19 Fresno State's Women's Basketball 1.00 16 16 16 16 16 Fresno State's Women's Volleyball 1.00 13 13 13 13 13 Other Anchor Tenant(s) Anchor Tenant - A 1.00 35 35 35 35 35 Anchor Tenant - B 1.00 0 0 0 0 0 Concerts Concerts - Popular 1.00 3 1 3 1 3 Concerts - Country 1.00 3 1 3 1 3 Concerts - Alternative 1.00 3 2 3 2 3 Concerts - Ethnic 1.00 4 3 4 3 4 Other Events Motorsports 1.00 1 1 1 1 1 Rodeo I Bull Riding 1.00 1 1 1 1 1 Roller Jam 1.00 1 1 1 1 1 Family Shows A 1.00 7 6 6 5 5 Family Shows B 1.00 4 5 5 6 6 NCAA Tournaments 1.00 0 0 3 0 0 WAC Tournaments 1.00 0 3 0 3 0 Tennis 1.00 2 2 2 2 2 International Volleyball 1.00 1 1 1 1 1 NBA Exhibition 1.00 0 1 0 1 0 Gymnastics 1.00 0 0 2 0 1 Professional Wrestling 1.00 3 3 3 3 3 High School Championships 1.00 3 3 3 3 3 Other Miscellaneous 1.00 2 2 2 2 2 TOTAL EVENTS 121 119 I 126 I 119 I 122 I

Proposed Save Mart Center -Prepared 0y Econorrics Research Associates 1/l6P2 12:08 PM Revenue Summaries & Assumptions 1 /1 6;02

Table 31 ASSUMPTIONS - AVERAGE TICKET PRICE SAVE MART CENTER - BASE CASE

Fiscal Year I 2004 I 2005 I 2006 I 2007 I 2008 I Sensitivity Fresno State Athletics Factor Fresno State's Men's Basketball 1.00 20.00 20.60 21.22 21.85 22.5 1 Fresno State's Women's Basketball 1.00 5.00 5.15 5.30 5.46 5.63 Fresno State's Women's Volleyball 1.00 5.00 5.15 5.30 5.46 5.63 Other Anchor Tenant(s) Anchor Tenant - A 1.00 8.00 8.24 8.49 8.74 9.00 Anchor Tenant - B 1.00 15.00 15.45 15.91 16.39 16.88 Concerts Concerts - Popular 1.00 30.00 30.90 31.83 32.78 33.77 Concerts - Country 1.00 28.00 28.84 29.71 30.60 31.5 1 Concerts - Alternative 1.00 25.00 25.75 26.52 27.32 28.14 Concerts - Ethnic 1.00 35.00 36.05 37.13 38.25 39.39 Other Events Motorsports 1.00 15.00 15.45 15.91 16.39 16.88 Rodeo I Bull Riding 1.00 15.00 15.45 15.91 16.39 16.88 Roller Jam 1.00 15.00 15.45 15.91 16.39 16.88 Family Shows A 1.00 16.00 16.48 16.97 17.48 18.0 1 Family Shows B 1.00 14.00 14.42 14.85 15.30 15.76 NCAA Tournaments 1.00 20.00 20.60 21.22 21.85 22.5 1 WAC Tournaments 1.00 15.00 15.45 15.91 16.39 16.88 Tennis 1.00 25.00 25.75 26.52 27.32 28.14 International Volleyball 1.00 12.00 12.36 12.73 13.11 13.5 1 NBA Exhibition 1.00 30.00 30.90 31.83 32.78 33.77 Gymnastics 1.00 12.00 12.36 12.73 13.11 13.5 1 Professional Wrestling 1.00 30.00 30.90 31.83 32.78 33.77 High School Championships 1.00 6.00 6.18 6.37 6.56 6.75 Other Miscellaneous 1.00 6.00 6.18 6.37 6.56 6.75

Proposed Save Mart Center -Prepared 0y Econorrics Research Associates 1/l6P2 12:08 PM Revenue Summaries & Assumptions 1 /1 6;02

Table 32 ASSUMPTIONS -AVERAGE PAID ATTENDANCE (000) SAVE MART CENTER - BASE CASE

Fiscal Year I 2004 I 2005 I 2006 I 2007 I 2008 I Sensitivity Fresno State Athletics Factor Fresno State's Men's Basketball 1.00 14.1 14.1 14.1 14.1 14.1 Fresno State's Women's Basketball 1.00 1.0 1.0 1.0 1.0 1.0 Fresno State's Women's Volleyball 1.00 0.8 0.8 0.8 0.8 0.8 Other Anchor Tenant(s) Anchor Tenant - A 1.00 5.5 5.5 5.5 5.5 5.5 Anchor Tenant - B 1.00 11.5 11.5 11.5 11.5 11.5 Concerts Concerts - Popular 1.00 8.0 8.0 8.0 8.0 8.0 Concerts - Country 1.00 10.0 10.0 10.0 10.0 10.0 Concerts - Alternative 1.00 5.0 5.0 5.0 5.0 5.0 Concerts - Ethnic 1.00 5.0 5.0 5.0 5.0 5.0 Other Events Motorsports 1.00 10.0 10.0 10.0 10.0 10.0 Rodeo I Bull Riding 1.00 10.0 10.0 10.0 10.0 10.0 Roller Jam 1.00 7.5 7.5 7.5 7.5 7.5 Family Shows A 1.00 4.5 4.5 4.5 4.5 4.5 Family Shows B 1.00 3.5 3.5 3.5 3.5 3.5 NCAA Tournaments 1.00 15.0 15.0 15.0 15.0 15.0 WAC Tournaments 1.00 15.0 15.0 15.0 15.0 15.0 Tennis 1.00 5.0 5.0 5.0 5.0 5.0 International Volleyball 1.00 2.0 2.0 2.0 2.0 2.0 NBA Exhibition 1.00 15.0 15.0 15.0 15.0 15.0 Gymnastics 1.00 3.0 3.0 3.0 3.0 3.0 Professional Wrestling 1.00 14.0 14.0 14.0 14.0 14.0 High School Championships 1.00 5.0 5.0 5.0 5.0 5.0 Other Miscellaneous 1.00 2.5 2.5 2.5 2.5 2.5

Proposed Save Mart Center -Prepared 0y Econorrics Research Associates 1/l6P2 12:08 PM Revenue Summaries & Assumptions 1 /1 6;02

Table 33 ASSUMPTIONS - TOTAL PAID ATTENDANCE (000) SAVE MART CENTER - BASE CASE

Fiscal Year I 2004 I 2005 I 2006 I 2007 I 2008 I Fresno State Athletics Fresno State's Men's Basketball 275.5 275.5 275.5 275.5 275.5 Fresno State's Women's Basketball 16.0 16.8 17.6 18.4 18.4 Fresno State's Women's Volleyball 10.4 10.9 11.4 11.9 11.9 Other Anchor Tenant(s) Anchor Tenant - A 192.5 183.3 183.3 183.3 183.3 Anchor Tenant - B 0.0 0.0 0.0 0.0 0.0 Concerts Concerts - Popular 24.0 8.0 24.0 8.0 24.0 Concerts - Country 30.0 10.0 30.0 10.0 30.0 Concerts - Alternative 15.0 10.0 15.0 10.0 15.0 Concerts - Ethnic 20.0 15.0 20.0 15.0 20.0 Other Events Motorsports 10.0 10.0 9.5 9.1 8.6 Rodeo I Bull Riding 10.0 10.0 10.0 9.5 9.1 Roller Jam 7.5 7.5 7.5 7.1 7. 1 Family Shows A 31.5 27.0 27.0 22.5 22.5 Family Shows B 14.0 17.5 17.5 21.0 21.0 NCAA Tournaments 0.0 0.0 45.0 0.0 0.0 WAC Tournaments 0.0 45.0 0.0 45.0 0.0 Tennis 10.0 10.0 10.0 10.0 10.0 International Volleyball 2.0 2.0 2.0 2.0 2.0 NBA Exhibition 0.0 15.0 0.0 15.0 0.0 Gymnastics 0.0 0.0 6.0 0.0 3.0 Professional Wrestling 42.0 42.0 40.0 40.0 38.0 High School Championships 15.0 15.0 15.0 15.0 15.0 Other Miscellaneous 5.0 5.0 5.0 5.0 5.0 Total Paid Attendance 730.4 I 735.5 I nu I 733.4 I 719.5 I

ProposedSave Mart Center -Prepared 0y Econorrics Research Associates 1/l6P2 12:08 PM Revenue Summaries & Assumptions 1 /1 6;02

Table 34 ASSUMPTIONS - PER CAPITA EXPENDITURES - (1) CONCESSIONS - FOOD & BEVERAGE SAVE MART CENTER - BASE CASE

Fiscal Year Sensitivity 2004 I 2005 I 2006 I 2007 I 2008 I Fresno State Athletics Factor Fresno State's Men's Basketball 1.00 6.00 6.18 6.37 6.56 6.75 Fresno State's Women's Basketball 1.00 3.00 3.09 3.18 3.28 3.38 Fresno State's Women's Volleyball 1.00 3.00 3.09 3.18 3.28 3.38 Other Anchor Tenant(s) Anchor Tenant - A 1.00 6.00 6.18 6.37 6.56 6.75 Anchor Tenant - B 1.00 6.00 6.18 6.37 6.56 6.75 Concerts Concerts - Popular 1.00 6.00 6.18 6.37 6.56 6.75 Concerts - Country 1.00 6.00 6.18 6.37 6.56 6.75 Concerts - Alternative 1.00 6.00 6.18 6.37 6.56 6.75 Concerts - Ethnic 1.00 6.00 6.18 6.37 6.56 6.75 Other Events Motorsports 1.00 6.00 6.18 6.37 6.56 6.75 Rodeo I Bull Riding 1.00 6.00 6.18 6.37 6.56 6.75 Roller Jam 1.00 6.00 6.18 6.37 6.56 6.75 Family Shows A 1.00 6.00 6.18 6.37 6.56 6.75 Family Shows B 1.00 6.00 6.18 6.37 6.56 6.75 NCAA Tournaments 1.00 8.00 8.24 8.49 8.74 9.00 WAC Tournaments 1.00 8.00 8.24 8.49 8.74 9.00 Tennis 1.00 4.00 4. 12 4.24 4.37 4.50 International Volleyball 1.00 4.00 4. 12 4.24 4.37 4.50 NBA Exhibition 1.00 6.00 6.18 6.37 6.56 6.75 Gymnastics 1.00 6.00 6.18 6.37 6.56 6.75 Professional Wrestling 1.00 6.00 6.18 6.37 6.56 6.75 High School Championships 1.00 3.00 3.09 3.18 3.28 3.38 Other Miscellaneous 1.00 3.00 3.09 3.18 3.28 3.38

(1) - Reflects weighted average for general seating, premium seating and catered food and beverage sales.

ProposedSave Mart Center -Prepared 0y Econorrics Research Associates 1/l6P2 12:08 PM Revenue Summaries & Assumptions 1 /1 6;02

Table 35 ASSUMPTIONS - PER CAPITA EXPENDITURES NOVELTIES SAVE MART CENTER - BASE CASE

Fiscal Year Sensitivity 2004 I 2005 I 2006 I 2007 I 2008 I Fresno State Athletics Factor Fresno State's Men's Basketball 1.00 1.50 1.55 1.59 1.64 1.69 Fresno State's Women's Basketball 1.00 0.75 0.77 0.80 0.82 0.84 Fresno State's Women's Volleyball 1.00 0.75 0.77 0.80 0.82 0.84 Other Anchor Tenant(s) Anchor Tenant - A 1.00 1.50 1.55 1.59 1.64 1.69 Anchor Tenant - B 1.00 1.50 1.55 1.59 1.64 1.69 Concerts Concerts - Popular 1.00 7.00 7.21 7.43 7.65 7.88 Concerts - Country 1.00 7.00 7.21 7.43 7.65 7.88 Concerts - Alternative 1.00 7.00 7.21 7.43 7.65 7.88 Concerts - Ethnic 1.00 7.00 7.21 7.43 7.65 7.88 Other Events Motorsports 1.00 2.00 2.06 2.12 2.19 2.25 Rodeo I Bull Riding 1.00 2.00 2.06 2.12 2.19 2.25 Roller Jam 1.00 2.00 2.06 2.12 2.19 2.25 Family Shows A 1.00 7.00 7.21 7.43 7.65 7.88 Family Shows B 1.00 7.00 7.21 7.43 7.65 7.88 NCAA Tournaments 1.00 3.00 3.09 3.18 3.28 3.38 WAC Tournaments 1.00 3.00 3.09 3.18 3.28 3.38 Tennis 1.00 1.00 1.03 1.06 1.09 1.13 International Volleyball 1.00 1.00 1.03 1.06 1.09 1.13 NBA Exhibition 1.00 5.00 5.15 5.30 5.46 5.63 Gymnastics 1.00 1.00 1.03 1.06 1.09 1.13 Professional Wrestling 1.00 1.00 1.03 1.06 1.09 1.13 High School Championships 1.00 0.75 0.77 0.80 0.82 0.84 Other Miscellaneous 1.00 0.75 0.77 0.80 0.82 0.84

Proposed Save Mart Center -Prepared 0y Econorrics Research Associates 1/l6P2 12:08 PM Revenue Summaries & Assumptions 1 /1 6;02

Table 36 ASSUMPTIONS - PARKING RATE PER CAR SAVE MART CENTER - BASE CASE

Fiscal Year I 2004 I 2005 I 2006 I 2007 I 2008 I Sensitivity Fresno State Athletics Factor Fresno State's Men's Basketball 1.00 7.00 7.21 7.43 7.65 7.88 Fresno State's Women's Basketball 1.00 4.00 4. 12 4.24 4.37 4.50 Fresno State's Women's Volleyball 1.00 4.00 4. 12 4.24 4.37 4.50 Other Anchor Tenant(s) Anchor Tenant - A 1.00 7.00 7.21 7.43 7.65 7.88 Anchor Tenant - B 1.00 7.00 7.21 7.43 7.65 7.88 Concerts Concerts - Popular 1.00 7.00 7.21 7.43 7.65 7.88 Concerts - Country 1.00 7.00 7.21 7.43 7.65 7.88 Concerts - Alternative 1.00 7.00 7.21 7.43 7.65 7.88 Concerts - Ethnic 1.00 7.00 7.21 7.43 7.65 7.88 Other Events Motorsports 1.00 7.00 7.21 7.43 7.65 7.88 Rodeo I Bull Riding 1.00 7.00 7.21 7.43 7.65 7.88 Roller Jam 1.00 7.00 7.21 7.43 7.65 7.88 Family Shows A 1.00 7.00 7.21 7.43 7.65 7.88 Family Shows B 1.00 7.00 7.21 7.43 7.65 7.88 NCAA Tournaments 1.00 7.00 7.21 7.43 7.65 7.88 WAC Tournaments 1.00 7.00 7.21 7.43 7.65 7.88 Tennis 1.00 4.00 4. 12 4.24 4.37 4.50 International Volleyball 1.00 4.00 4. 12 4.24 4.37 4.50 NBA Exhibition 1.00 7.00 7.21 7.43 7.65 7.88 Gymnastics 1.00 4.00 4. 12 4.24 4.37 4.50 Professional Wrestling 1.00 7.00 7.21 7.43 7.65 7.88 High School Championships 1.00 4.00 4. 12 4.24 4.37 4.50 Other Miscellaneous 1.00 4.00 4. 12 4.24 4.37 4.50

Proposed Save Mart Center -Prepared 0y Econorrics Research Associates 1/l6P2 12:08 PM APPENDIX B

SUMMARIES OF CERTAI N PROVISI ONS OF THE INDE NTURE AND GROUND LEASE

The following outl ine is a brief surrrraryof certai n provisions contained in the Indenture and the Ground Lease and is not to be considered as a fu ll statement thereof. Reference is made to the Indenture and the Ground Lease for fu ll details of the terms of the Bonds, the appl ication of Event Center Proj ect Revenues therefor and the security provisions pertaini ng thereto. Capitaliied terms not defi ned herei n shall have the meani ngs set forth in the Indenture and the Ground Lease, respectively.

CERTAIN DEFINITIONS

The term "Additional Bonds'' means Additional Senior Bonds and Additional Subordinate Bonds.

The term "Aggregate Annual Debt Service" means forany Fiscal Year Annual Debt Service on the appl icable Indebtedness.

The term "Annual Debt Service" means, when used with respect to Indebtedness, as of any date of calculation and with respectto any periodthe sum of (i) the interest payable on al l suchIn debtedness during such period (except to the extent that such interest is payable from the proceeds of such Indebtedness set aside for such purpose) , and (ii) the pri nci pal (or mandatory si nking fund or redemption fund or installment purchase price or lease rental or si milar pay ment or deposit) payments on such Indebtedness requi red in such period; computed on the assumption that no portionof such Indebtedness wi ll cease to beoutstand ing in such period except by reason of the applicationof such scheduled pay ments; provided, however, that for purposes of suchcomputa tion if Indebtedness is secured by an irrevocable letter of credit issued by a bank having a combi ned capital and surpl us of at least $100,000,000, pri nci pal pay ments or deposits with respect to such Indebtedness nomi nal ly due in the last Fiscal Year in which such Indebtedness matures may, at the option of the Corporation, be treated as if they were due as specified in any loan ag reement or rei mbursement agreement issued in connection with such letter of credit or pursuant to the repayment provisions of such letter of credit and interest on such Indebtedness after such Fiscal Year wi ll be assumed to be payable pursuant to the terms of such loan agreement or rei mbursement agreement or repayment provisions; and provided further that if interest on Indebtedness is payable pursuant to a variable interest rate formula, the interest rate on such Indebtedness for periodswhen the actual interest rate cannot beyet determi ned wi ll be assumed to beequal to the greaterof (a) the current interest rate calculated pursuant to the provisions of such ag reement or, (b) if avai lable, the weekly average interest rate on such Indebtedness during the preceding 36 rmnths preceding the date of calculation or, (c) if such Indebtedness has not been outstanding for such 36-rronth period, such weekly average interest rate on comparable debt (as determi ned bythe Corporation) , as set forth in a certificate filed with the Trustee and the Corporation.

The term " Board" meansthe Board of Trusteesof The Cal ifornia State University, as the same is organized and exi sti ng under and by virtue of the laws of the State of California now in effect and as thereafter amended.

The term "Bulldog Foundation Agreement" meansthe Mermrandum of Understanding, dated as of January 1, 2002, between the Corporation and the B ul I dog Foundation, as the same may beamended from ti meto ti mein accordance with its terms and the Indenture.

The term "Capital Replacement Account Requirement" means, as of any date of calculation, an armunt equal to $430,000 peryear, which armunt shal l be periodical ly adj usted (as set forth in a Certificate of the Corporationfi led with the Trustee), as fol lows: (i) on or beforeJ une 1 in each year, such armunt shall be increased each year by an armuntequal to the lesser of (a) the ConsumerPr ice Index for the area in which the Event Center is located (or, if such index is no longeravai lable, then a comparable index selected by the Corporation), or (b) 3% ; and (ii) not less frequentlythan every 5 years, commencing on or beforeJ une 1, 2006, sucharmunt shal l beadj usted in accordance with a written report of a Event Center Consultant (filed with the Trustee together with such

B-1 Certificate of the Corporation) describi ng, in the opinion of such Event Center Consultant, the appropriate arrount that should be on deposit in the Capital Replacement Account in light of (a) the fi nancial conditionand the physical condition of the Event Center Proj ect, (b) the arrount of Outstanding Bonds and any Parity Senior Debt, and (c) si milar provisions for repair and replacement reserves made with respectto other multi-purpose event center projects that are comparable to the Event Center Proj ect.

The term "Code'' means the Internal Revenue Code of 1986and the regulations issued thereunder, or any successor to the Internal Revenue Code of 1986. Reference to any particular Code section will, in the event of such a successor Code, bedeemed to be refere nce to the successor to such Code section.

The term "Completion Project" means any and al l capital improvements or equipment or real property which are necessary to complete the original design, plans and specifications (as modified by any change orders or similar adj ustments) for the Event Center Proj ect and thereafter fi nanced with proceeds of Parity Senior Debt, including Additional Bands descri bed byany indenture supplemental to the Indenture.

The term "Contractually Obligated Income" means, for any appl icable period, the aggregate arrount, as set forth in a Certificate of the Corporation fi led with the Trustee, which the Corporation reasonably expects to receive as Event Center Proj ect Revenues for such period but only to the extent derived from leases, licenses, advertising and sponsorshi p agreements and other agreements providing payments to the Corporationwith respect to, or for the benefit of, the Event Center Proj ect and which are entered into between the Corporation and commercially responsi ble parties, including without limitation the Bulldog Foundation.

The term "Contractually Obligated Income Coverage Ratio'' means, for any appl icabl e period, the ratio derived from dividing the Contractual ly Obligated Income for such period by the Senior Bonds Annual Debt Service Requi rement for such period.

The term "Debt Service Coverage Ratio" means, for any appl icabl e period, the ratio derived from dividing Net Event Center Proj ect Revenues Avai lable for Debt Service for such period by the Senior Bonds Debt Service Requi rement for such period.

The term " Event Center Manager" means the Event Center Manager underthe Management Agreement.

The term "Event Center Project" means the Save Mart Center, as that project is descri bed in Exhi bit A to the Indenture and re lated improvementsand any Completion Proj ect and any Subsequent Proj ect.

The term "Event Center Project Revenues'' means al l exi sting fund balances, proceeds, charges, income, rents, recei pts, profi ts and benefitsof the Corporation, in each case rel ated to or derived from the fol lowi ng: (i) the ownership andpr operation by the Corporation of the Event Center Proj ect, including without limitation al l gate receipts, revenues of the Corporation derived from concessions, sales of novelties, Arena Builder Seat sales, private fundrai si ng, corporate sponsorshi ps, luxury seat sales, personal seat licenses, signage contracts and naming rights; (ii) the Ground Lease; (iii) the Bulldog Foundation Agreement; and (iv) the Student Seati ng Purchase Agreement, but in al l cases exclusive of: (a) any gifts, grants, bequests, donations and contri butions to the extent specifical ly restricted by the donor to a particular purpose inconsistent with thei r use for payments with respect to Indebtedness; and (b) assets of the Corporation unrelated to, or not derived from, the ownership andpr operation by the Corporation of the Event Center Project.

The term "Indebtedness'' means any indebtedness or obligation of the Corporation which, in accordance with general ly accepted accounti ng pri nciples, is classified as a liabi lity on a bal ance sheet.

The term "Investment Securities'' means any of the following which at the ti me are legal investments (as determi ned by the Corporation) under the laws of the State of Cal ifornia for rroneys heldunder the I ndenture and then proposedto be invested therein:

B-2 (1) Direct obligations of the United States of America (including obl igations issued or held in book-entry form on the books of the Department of the Treasury) or obl igations the pri nci pal of and interest on which are unconditional ly guaranteed bythe Un ited States of America

(2) Bonds, debentures, notes or otherevi dence of indebtedness issued or guaranteed by any of the fol lowi ng federal agenciesand provided such obl igationsare backed by the full fai th and credit of the United States ofAme rica (stripped securitiesare only permitted if they have been stri pped bythe agency itself) :

a FarmersHo meAdmini stration (FmHA): Certificates of beneficial ownership;

b. Federal Housi ng Administration (FHA): Debentures;

c. General Services Administration: Participation certificates;

d. Government National Mortgage Association (GNMA or "Ginnie Mae" ); G NMA-g uaranteed rmrtgage backed bonds, G NMA-gua ranteed pass-through obl igations (participationcertifi cates) ;

e. U.S. MaritimeAdministration: Guaranteed TitleXI fi nancing; and

f. U.S. Department of Housi ng and Urban Development (HUD): Proj ect Notes, Local Authority Bands.

(3) Bonds, debentures, notesor otherevi dence of indebtedness issued or guaranteed by any of the following non-ful l faith and credit U.S. government agencies (stri pped securities are only perrritted if they have been stripped bythe agency itself) :

a. Federal Home Loan Bank System: Senior debt obl igations (Consol idated debt obl igations);

b. Federal Home Loan Mortgage Corporation (FHLMC or "Freddie Mac"): Participation Certificates (Mortgage-backed securities), Senior debt obligations;

c. Federal National Mortgage Association (FNMA or "Fannie Mae"): Mortgage backed securities and senior debt obligations (excl uded are stri pped rmrtgage securities which are val ued greater than par on the portion of the unpaid pri ncipal);

d. Student Loan Marketi ng Association (SLMA or "Sal lie Mae"): Senior debt obi igations;

e. Resolution Funding Corp. (REFCORP): Only the interest component of REFCORP strips which have been stri pped by request to the Federal Reserve Bank of New York in bookentry form areaccepta ble; and

f. Farm Credit System: Consol idated systerrMtidebonds andnotes.

(4) Money market funds (including funds managed or advised by the Trustee or an affi liate of the Trustee) registered under the Federal Investment Company Act of 1940, whose shares are registered under the Federal Securities Act of 1933, and having a rati ng of "AAAm-G" or "AAAm'' or equivalent by aRati ng Agency.

(5) Certificates of deposit secured at al l ti mes by col lateral described in (1) or (2) above. Certificates of deposit must have a one year or less mat urity. Such certificates must be issued bycommercial banks (includi ng the Trustee or its affi liates), sav ings and loan associations or mutual sav ings banks whose short term obl igations are rated "A-1 -+'' or betteror equivalent by aRa ti ng Agency.

B-3 (6) Certificates of deposit, sav ings accounts, deposit accounts or rmney market deposits (incl udi ng those of the Trustee and its affi liates) which are fully insured by FDIC, including BIF and SAIF.

(7) Collateral ized or uncollateral ized investrrent agreerrents or other contractual arrangerrentswith corporations, fi nancial institutions or national associations within theUn ited States, provided that the senior long-term debt of such corporations, institutions or associations is rated within the top two rating categories by ana tionally recognized rati ng agency;

(8) Comrrercial paperrated "Prirre-1 " or "A-1 -+'' or better or equivalent by aRa ti ng Agency.

(9) Bonds or notes issued byany state or municipality which are rated by aRati ng Agency in one of the two highest long-termra ti ng categories assigned by such Rati ng Agency.

( 10) Federal funds or bankers acceptances with a maximum term of one year and of any bank which has an unsecured, uninsured and unguaranteed obl igation rating of "Prirre-1" or "A3" or better or equivalent by aRa ti ng Agency.

( 11) Repurchase agreerrents providing for the transfer of securities from a dealer bank or securities firm (sel ler;borrower) to the Corporation or the Trustee (buyer�ender), and the transfer of cash from the Corporation or the Trustee to the dealer bankor securities firm with an agreerrentthat the dealer bankor securities firm wi ll repay the cash pl us a yield to the municipal entity in exchange for the securities at a specifieddate . Such repurchase agreerrents must satisfy the fol lowi ng criteria:

a Repurchase agreerrents must be between the Corporation or the Trustee and a dealer bank or securities fi rm: (i) Primary dealers on the Federal Reserve reporting dealer list which fall under the jurisdiction SIPC and which are rated "A" or better or equivalent by aRati ngAgen cy; or (ii) Banks rated "A" or better or equivalent by aRati ngAgency ;

b. The written repurchase agreerrent must include the fol lowi ng:

(i) Securities which are acceptable for transfer: (a) Direct U.S. governrrents, and (b) Federal agencies backed by the full faith and credit of the U.S. governrrent (FNMA and FHLMC);

(ii) The term of the repurchase ag reerrent may beup to 30 days;

(iii) The col lateral must be delivered to the Corporation, Trustee or third party acti ng as agent for the Trustee before or simultaneouswith pay ment (perfection by possession of certificated securities) ;

(iv) The Trustee has a perfected first priority security interest in the collateral for the benefitof the Holders of the Bands;

(v) Collateral is free and clear of third-party liens and in thecase of SIPC, broker was not acquired pursuant to a repurchase ag reerrentor reverse repurchase agreerrent;

(vi) Fail ure to mai ntai n the requisite collateral percentage, after a two day restoration period,wi ll require the Trustee to liquidate collateral ;

(vii) Val uationof collateral :

(a) the securities must be val ued weekly, market-to-market at current market price plus accrued interest; and

B-4 (b) the value of the col lateral must be equal to 104% of the amount of cash transferred by the Corporation to the dealer bank or security firm under the repurchase agreerrent pl us accrued interest. If the value of securities held as collateral sl ips below 104% of the value of the cash transferred by the Corporation, then additional cash andpr acceptable securities must be transferred. If, however, the securities used as collateral are FNMA or FHLMC, then the val ue of the collateral must equal 105% ;

c. Legal opi nion which must be delivered to the Corporation: the repurchase ag reerrent rreets guidelines under state law for legal investrrent of funds of the Corporation;

d. The col lateral must be held by a third party andthe Bondholders must have a perfected first priority security interest in the col lateral . To the extent that any of the requirerrents concerning lnvestrrent Securities embodies a legal conclusion, the Trustee wi ll be entitled to conclusively rely upon a certificate from the appropriate party or an opi nion from counsel to such party, in form and content satisfactoryto the Trustee, that such requirerrent has been rret.

( 12) Pre-refunded municipal bondsrated " Aaa' or equivalent by a Rati ng Agency.

(13) The Local Agency lnvestrrent Fund (LAIF) and any other state admi ni stered pool investrrent fund in which the Corporation is statutorily permitted or required to invest to the extent such depositsare held in the nameof the Trustee.

The term "Management Agreement" rreans a management agreement between the Corporation and the Event Center Manager providing for the managementand operation of the Event Center Proj ect, as the sarre may beamended from ti meto ti me in accordance with its termsand with the I ndenture.

The term "Mater ial Adverse Effect" means (1) a material adverse change in the fi nancial condition of the Borrower or the Event Center Proj ect; or (2) any event or occurrence of whatever nature which would materially and adversely change the Corporation's abi lity to perform its obligations under the Security Documentsor the I ndenture.

The term "Maxi mum Aggregate Annual Debt Service" meansAgg regate Annual Debt Service on the appl icable Indebtedness for the Fiscal Year in which such Annual Debt Serviceis the largest.

The term " Net Event Center Project Revenues Available for Debt Service" means, with respect to any period, the excess of Event Center Proj ect Revenues over Operating Expenses(be fore extraordinary items) of the Event Center Proj ect, deterrri ned in accordance with general ly accepted accounti ng principles, to which shal l be added interest, amortization and depreciation expense and other non-cash charges, each item deterrri ned in accordance with general ly accepted accounti ng pri nciples, and excludi ng (a) any profits or losses on the sale or disposition, not in the ordi nary course of busi ness, of investments or fixed or capital assets or resulting from the early exti nguishrrent of debt, (b) gifts, grants, bequests, donations and contributi ons, to the extent specifical ly restricted bythe donor to a particular purpose inconsi stent with thei r use for the pay mentof debt service,and (c) the net proceedsof insurance ( other than businessin terruption insurance) and condemnation awards.

The term "Non-Recourse Indebtedness" means any indebtedness secured by a lien on specific property, which is nota general obl igation of the Corporation and liabi lity for which is effectively limited to the property subject to such lien with no recourse to, or lien upon, di rectly or indi rectly, any other property of the Corporation.

B-5 The term "Operating Expenses'' meansact ual , reasonable and customary costs, feesand expenses directly attri butable to the Event Center Proj ect, includi ng without limitation pai nting, cleaning, repai rs, alterations; landscapi ng and uti lities; rubbi sh removal ; certificates, permits and licenses; sewer charges; real and personal property taxes and assessments, if any ; insurance prerri ums; security; advertising, promotion and publ icity; office, janitorial, cleaning and bui lding suppl ies; purchase, repai r, servicing and instal lation of appl iances, equipment, fixtures and furnishings; and fees and expenses of accountants, attorneys, consultants, the Event Center Manager and otherprofes sionals, but excluding any amounts required to be deposited into the Capital ReplacementAccount.

The term "Parity Senior Debt" means Indebtedness of the Corporation which satisfies the fol lowing conditions: the ag reement under which the Parity Senior Debt is issued shall require that (a) an Event of Default shal l constitute an event of default undersuch ag reement; (b) rights and obligations of the holders of Parity Senior Debt shal l be substantially the same as the rights and obligations of the Holders of Senior Bonds; (c) remedies upon an event of default shall be substantially the same as the remedies provided in the Indenture and, prior to exercising any such remedies, the holders of such Parity Senior Debt (or a trustee representi ng their interests) shall be requi red to cooperate with the Trustee to the end that the interests of such holders and the Holders shal l be equal ly protected; (d) payments shall be made no more frequently than monthly; and (e) the rate of interest on the Parity Senior Debt shal l be a fixed rate

The term "Parity Subordinate Debt" means Indebtedness of the Corporation which sati sfies the fol lowing conditions: the agreement under which the Parity Subordi nate Debt is issued shal l require that: (a) an Event of Default shal l constitute an event of default under such agreement; (b) rights and obl igations of the holders of Parity Subordinate Debt shal l be substantial ly the same as the rights and obligationsof the Holders of Subordinate Bonds; (c) remedies upon an event of default shal l be substantially the same as the remedies provided in the Indenture and, prior to exercising any such remedies, the holders of such Parity Subordi nate Debt (or a trustee representi ng their interests) shal I be requi red to cooperate with the Trustee to the end that the interests of such holders and the Holders shall be equally protected ; (d) payments shal l be made no more frequently than monthly; and (e) the rate of interest on the Parity Subordinate Debt shall be a fixed rate.

The term "Permitted Encumbrances'' means: (1) undetermi ned liens and charges incident to construction or mai ntenance, and liens and charges incident to construction or rrai ntenance fi led of record which are being contested in good fai th and have not proceeded to fi nal judgment (and for which all appl icable periods for appeal or review have not expired), provided (a) that the Corporation shall have set aside reserves with respect thereto which, in the opi nion of an Authorized Representative of the Corporation filed with the Trustee, are adequate; (2) notices of lis pendens or other notices of or liens with respect to pending actions which are bei ng contested in good faith and have not proceeded to fi nal judgment(and for which al l appl icable periodsfor appeal or review have not expi red) , provided the Corporation shal l have set aside reserveswith respect thereto which, in the opi nion of an Authorized Representativeof the Corporation filed with the Trustee, are adequate; (3) the lien of taxes and assessments which are not del inquent, or which are bei ng contested in good faith, provided (a) that the Corporationshal l have set aside reserveswith respectthe reto which, in the opi nion of the Authorized Representative of the Corporation fi led with the Trustee, are adequate, and (b) that non-payment of such taxes and assessments wi ll not result in any loss of property; (4) mi nordefects and irregularities in title which in the aggregate do not materially adversely affect theval ue or operation of the propertyto which suchencu mbrance relates for the purposes for which it is or may reasonably be expected to be used; (5) easements, exceptions or reservations for the purpose of ingress and egress, parki ng, pi pel ines, telephone lines, telegraph lines, cable television lines, power lines and substations, roads, streets, al leys, highways, rai lroad purposes, drai nage and sewerage purposes, dikes, canals, lateral s, ditches, the removal of oi I, gas, coal or other rrineral s, and other Iike purposes, or for the joint or common use of real property, facilities and equi pment, which in the aggregate do not material ly interfere with or impai r the operation of the property to which such encumbrance relates for the purposes for which it is or may reasonably be expected to be used; (6) rights reserved to or vested in any municipal ity or governmental or other publ ic authority to control or regulate or use in any manner any portion of the property which do not material ly impai r the operation of the property to which such encumbrance relates for the purposes for which it is or may reasonably be expected to be used; (7) present or future val id zo ni ng laws and ordi nances; (8) the rights of the Corporation and the Trustee under the Indenture; (9) the rights of the Trustee under the Deed of Trust; (10) liens securing the indebtedness for the pay ment, redemption or satisfaction of which money (or evidences of indebtedness) in the necessary amount shal l have been deposited in trust with a trustee or other holder of such indebtedness; ( 11) purchase money security interests and security interests existi ng on any property prior to the ti meof its acquisition through purchase, merger,

B-6 consol idation or otherwi se, whether or not assumed by the purchaser thereof, or placed upon property bei ng acquired to secure a portion of the purchase price thereof, or upon equi pment acquired through a capital lease or installment purchase arrangement, or lessor' s interests in leases requi red to be capital ized in accordance with generally accepted accounti ng principles, and security interests in property granted to secure indebtedness (" Refinancing Indebtedness'' ) incurred to refinance indebtedness initially secured by a purchase rmney security interest in such property to the extent that the initial pri ncipal armunt of such R efi nanci ng I ndebtedness does not exceed the pri ncipal armunt of the refi nanced indebtedness that is outstanding immediately prior to such refi nancing; (12) statutory liens arising in the ordinary course of busi ness which are not deli nquent or are being contested in good faith; ( 13) other liens or encumbrances listed as exceptions to the policy of title insurance issued as of the date of recordation of the Deed of Trust; ( 14) any sublease or other right or interest in the leasehold of the Corporationunder the Ground Lease relati ng to the center for innovationand entrepreneurship, the e-businesscenter or any other business development; provided that any such sublease, right or interest wi ll not interfere with the ownership andpropera tion of the Event Center Proj ect.

The term "Project Costs'' means the costs of planning, design, acquisition, construction and improvement of the Event Center Proj ect, includi ng without limitation armunts payable under the Construction Contract, all costs of furnishing, fi xtures and equipment, development costs and fees, construction management costs and expenses, conti ngency and initial, start-up working capital costs, other approved pay ments under the Proj ect Documents relati ng to the acquisition, construction and furni shing of the Event Center Proj ect, legal , accounti ng, engineeri ng and other costs, including costs of fi nancing, taxes, insurance and other fees, licenses and costs or expenses related to the acquisition and construction of the Event Center Proj ect.

The term "Project Documents'' means (i) the CM;GCAg reement between the Corporation and The Clark Construction Group, Inc.; (ii) the Sponsorshi p and Naming Rights Agreement, between the Corporation and Bottling Group, L.L.C. D;B/A The Pepsi Bottl ing Group, (iii) the Sponsorship Agreement, between the Corporation and California Federal Bank, (iv) the Sponsorship Agreement, between the Corporation and Pacific Bell Telephone Company, (v) the Sponsorship Agreement, between the Corporation and Kroeker, Inc., (vi) the Mermrandum of Understanding between the Corporation and Community Medical Centers (and any Sponsorshi p Agreement that may be entered into between sai d parties relating to the Event Center Proj ect) , (vii) the Arena Builders Licenses relatingto the Event Center Proj ect, (viii) the Luxury Suite Licenses relati ngto the Event Center Proj ect, (ix) the Personal Seat Licenses relati ng to the Event Center Proj ect; (x) the Management Agreement; and (xi) such other ag reements relati ng to the Event Center Proj ect such as additional Sponsorshi p Agreements, advertising or signage contracts as may bedes cri bed in the Indenture or in a Certificate of theCorporation fi led with the Trustee.

The term "Security Documents'' means the Ground Lease, the Deed of Trust, the Bulldog Foundation Agreement, the Student Seating Purchase Agreement, the Proj ect Documents, and any other documents relati ng to the security i nterest in the Trust Estate.

The term "Senior Bonds Debt Service Requirement" means, with respect to any period, the Annual Debt Serviceon theSe nior Bands for such period.

The term "Senior Reserve Account Requirement" means, as of any date of calculation, an armunt equal to thele ast of (A) Maxi mum Aggregate Annual Debt Service, calculated on al I Senior Bands of such series Outstanding as of such date, (B) 125% of average annual debt service on al l Senior Bonds of such series Outstanding as of such date, or (C) l(Jl,.,6 of the original principal armunt of such series of Senior Bonds.

The term "Series 2002 Project" means the Event Center Proj ect to be acquired with proceeds of the Series 2002 Bands.

The term "Site" meansthe parcel of real property leased bythe Board to the Corporation pursuant to the Ground Lease.

The term "State" means the State of Cal ifornia

B-7 The term "Student Seating Purchase Agreement" means the Student Seating Purchase Agreement, dated as of December 1, 2001, between the Corporation and the Board, as the same may beamended from ti meto ti me in accordance with its terms and the I ndenture.

The term "Subordinate Reserve Account Requirement" means, as of any dateof calculation, an amountequal to the least of (A) Maxi mum Aggregate Annual Debt Service,ca lculated on all Subordinate Bands of such series Outstanding as of such date, (B) 125% of average annual debt serviceon all Subordi nate Bonds of such series Outstanding as of such date, or (C) lQJ,.,6 of the original pri ncipal amountof such series of Subordi nate Bonds.

The term "Subsequent Proj ect" means any and all capital improvements or equipment or real propertywhich are additions, improvementsor replacementsfor al l or part of the Event Center Proj ect and thereafter financed with proceedsof Parity Senior Debt, including Additional Bonds described by any indenture supplemental to the I ndenture.

The term " University" meansCal ifornia State U niversity, Fresno.

THE INDENTURE

Revenues

Pledge; Event Center Project Revenue Fund; Revenue Fund. Subj ectonly to thepro visions of the Indenture permitting the appl ication thereof for the purposes and on the terms and conditions set forth therei n, the Corporation pledges to secure the payment of the principal of, premi um, if any, and interest on the Bonds in accordance with their termsand the provisions of the Indenture, al l of the Event Center Proj ect Revenues and any other armunts (including proceeds of the sale of Bonds) held in any fund or account establ ished pursuant to the Indenture other than the Rebate Fund. Said pledge will constitute a lien on and security interest in such assets for the payment of the Bonds in accordance with their terms; provided, however, that said pledge is created and establ ished in the following order of priority: first, to secure the pay ment of the pri ncipal of and interest and redemption premium, if any on the Senior Bonds in accordance with the termsand provisions of the Indenture, and second, to secure the pay ment of the pri ncipal of and interest and redemption premi um, if any on the Subordinate Bonds in accordance with the terms and provisions of the Indenture; and provided further, however, that the amounts on deposit in the Subordi nate ReserveAccoun t will be pledged exclusively to and provide security solely for the Subordinate Bands so that theSe nior Bands wi II have no security or other interest therein.

The Corporation agrees that, so long as any of the Bonds remai n Outstanding, al l of the Event Center Proj ect Revenues of the Corporation not needed to pay Operating Expenses (which wi ll be deposited as described below) will bedeposi ted as soon as practicable (and in any eventwithi n five Busi ness Days) upon receipt in a fund designated as the "Event Center Proj ect Revenue Fund" which the Corporation will establish and mai ntain underthe I ndenture in an account or accounts with the Trustee. Subject to the provisions of the following paragraph and the provisionsunder the caption "Allocationof Event Center Proj ectRevenues '' , following such depositwith the Trusteeand so long as no Event of Default (as that term is defi ned in the Indenture) has occurred and is continuing, the Corporation may , upon the filing of a Statementof the Corporation with the Trustee, withdraw al l or any partof such armunts on deposit with the Trustee anticipated to be needed for the pay ment of Operating Expenses and depositsuch amountsat suchother banki ng or financial institution or institutions as the Corporation will from time to time designate in writing to the Trustee for such purpose (herein cal led the "Depository Bank(s)"), which Depository Bank shal l have its long-term unsecured debt rated "A" or better by a Rating Agency. Subject only to the provisions of the Indenture permitting the appl icationthereof for the purposes and on the terms and conditions set forth in the Indenture, the Corporation pledges and, to the extent permitted by law, grants a security interest to the Trustee in the Event Center Proj ect Revenue Fund to secure the pay ment of the pri ncipal of, premi um, if any, and interest on theBa nds.

Amounts in the Event Center Proj ect Revenue Fund may be used and withdrawn by the Corporation at any timefor the payment of Operating Expenses or to make the deposits in the manner required by the Indenture. In the event that on the 25th day of each month, the Trustee does not have amounts sufficient to make the transfers and deposits required bythe I ndenture on the first day of the next succeeding month, the Trustee wi 11

B-8 notify the Corporation and the Depository Bank(s), to the extent practicable, by telephone or telecopy, of such delinquency, and unless such payment is made on the same day the Corporation receives such notice, the Corporation will cause the Depository Bank(s) to, and the Depository Bank(s) will, transfer all Event Center Proj ect Revenues held by such Depository Bank(s) to theTru stee to hold in trust for the benefitof the Holders of the Bonds and the holders of Parity Senior Debt. During any periodthat the Trustee does not have armunts sufficient to make the transfers and deposits required by the Indenture, the Corporation will not be entitled to use or withdraw any of the Event Center Proj ect Revenues unless used and withdrawn for the pay ment of current or past due Operating Expensesof the Corporation. Otherwise, the Trustee will use and withdraw from tirrE toti me armunts in said fund to make the transfers and deposits required by the Indenture and any Parity Senior Debt as such payments becorrE due, and if such armunts wiII not be sufficient to pay in full al I such payments due on any date, then to the pay ment of thetransfers and deposits required by the Indenture and debt service with respect to Parity Senior Debt ratably according to the armunts due respectively for such transfers and deposits required by the Indenture and such debt service on Parity Senior Debt, without any discrimination or preference. The Corporation agrees to execute and deliver all instrumentsas may be required to implement this section. The Corporationfurther agrees that a failure to complywith theterms of this section shall cause irreparable harm to the Holders from timeto timeof the Bonds and the holders of Parity Senior Debt and will entitle the Trustee, with or without notice, to take immediate action to compel the specific performanceof the obligations of the Corporation as provided in this section.

On or beforethe 15th day of each rmnthand so I ong as any of theBa nds remai n Outstanding, the Corporation will pay to the Trustee such armunt as is required by the Trustee to make the transfers and deposits required on the first day of the next succeeding rmnth by the I ndenture. Each transfer by theCorpora tion to the Trustee under the Indenture will be in lawful rmneyof the United Statesof America and paid to the Trustee at the Principal Office of the Trustee. All such rmneyswi ll be promptly deposited bythe Trustee uponrece ipt thereofin a special fund designated as the "Revenue Fund" which the Trustee will establ ish, mai ntai n and hold in trust. All rmneysdeposited with theTr ustee will be held, disbursed, al located and applied by the Trustee only as provided in the I ndenture.

If by the 16th day of each rmnth the Trustee has not received rmneys sufficient to make the transfers and deposits required on the first day of the next succeeding rmnth by the Indenture, the Trustee wi 11 immediately notifythe Corporation of such insufficiency bytel egram, telecopyor telephone (confirmed in writing).

If on the 20th day of such rmnth the Trustee has not received rmneys sufficient to make the transfers and deposits required on the first day of the next succeeding rmnth by the Indenture, the Trustee wi 11 immediately notifythe Corporation by telegram, telecopy or telephone (confirmed in writing). Said notice will demand the Corporation to imrrEdiately depositan armunt equal to the armuntnecessary to make the transfers and deposits required on the first day of the next succeeding rmnth by the Indenture. If the Trustee does not receive such armunt bythe 25th day of such rmnth, theTrus tee will take the actions described in the third paragraph of this subsection.

Allocation of Event Center Project Revenues. On or before the dates set forth below, the Corporation will transfer or will cause the Trustee to transfer from the Event Center Proj ect Revenue Fund and deposit into the fol lowing respective accounts (each of which will be establ ished and mai ntained as specified in the Indenture) , the fol lowing armunts, in the following order of priority, the requirements of each such account (including the maki ng up of any deficiencies in any such account resulting from lack of rmneys sufficient to make any earl ier required deposit) at the time of deposit to be satisfied before any transfer is made to any account subsequent in priority:

(A) On or before the fi rst day of each rmnth, to the Senior Interest Account (which the Trustee will establish and mai ntain in the Revenue Fund) , one-sixthof the aggregate armuntof interest becorri ng due and payable during the next ensuing six rmnths on al l Senior Bonds then Outstanding less any armunts to be transferred to the Senior Interest Account from the Senior Capitalized Interest Account as capital ized interest for the pay ment of such interest, until the balance in the Senior Interest Account is equal to said aggregate amount of interest (taki ng into account saidtransfers from the Senior Capital ized Interest Account); provided that during the periodfrom the date of delivery of a series of Senior Bands until the first interest pay ment date for such series, such transfers will be sufficient on a rmnthly pro ratabasi s to pay the aggregate armuntof interest becoming due and payable on the first interest paymentdate for such series.

B-9 (B) On or before the fi rst day of each month, to the Senior Pri nci pal Account (which the Trustee wi ll establ ish and mai ntain in the Revenue Fund) , one-twelfth of the aggregate amount of pri ncipal becorring due and payable on the Outstanding Senior Serial Bands pl us the aggregate amountof Mandatory Sinking Account Payments requi red to be pai d into the respective Sinki ng Accounts for Outstanding Senior Term Bonds, in each case during thenext ensuing twelve months, unti l the balance in sai d account is equal to saidaggregate amount of such pri nci pal and Mandatory Sinking Account Payments; provided that during the period from the date of deliveryof a series of Senior Bands unti l the fi rst principal payment date for such series (if less thantw elve months), such transfers will be sufficient on a monthly pro rata basis to pay the aggregate amount of pri nci pal becorri ng due and payable on the first principal pay mentdate for such series.

(C) On or before the fi rst day of each month, to the Senior Reserve Account (which the Trustee wi ll establ ish and maintai n in the Revenue Fund), an amount equal to either: (i) an amount equal to the amount, if any, necessary to restore the amount on deposit in such account to the Senior Reserve Account Requirement, or (ii) the amount necessary to repay any and al l obl igations due and payable under the terms and conditions of any letter of credit provided for in the Indenture or any insurance pol icy provided for in the Indenture. No deposit need be made into the Senior Reserve Account so long as the balance in said account wi ll be at least equal to the amountreq ui red by the I ndenture to beon deposittherei n.

(D) On or before the first day of each month, to the Capital ReplacementAccount (which the Corporation will establ ish and maintai n), an amount equal to one-twelfth of the Capital Replacement Account Requirementfor the next ensui ng twelve months.

(E) On or before the first day of each month, to the Subordi nate Interest Account (which the Trustee wi ll establish and mai ntain in the Revenue Fund) , one-sixth of the aggregate amountof interest becorri ng due and payable during the nextensuing six months on al l Subordi nate Bonds then Outstanding less any amountsto betransferred to theSu bordinate Interest Account from the Subordinate Capitalized Interest Account as capitalized interest for the payment of such interest, unti l the balance in the Subordi nate Interest Account is equal to said aggregate amount of interest (taki ng into account saidtransfers from the Subordinate Capitalized Interest Account) ; provided that during the period from the date of del ivery of a series of Subordi nate Bonds unti l the fi rst interest pay ment date for such series, such transfers wi ll be sufficient on a monthly pro rata basis to pay the aggregate amount of interest becomi ng due and payable on the first interest pay ment date for suchseries.

(F) On or before the fi rst day of each month, to theSu bordinate Principal Account (which the Trustee wi ll establ ish and mai ntain in the Revenue Fund) , one-twelfth of the aggregate amount of pri ncipal becoming due and payable on the Outstanding Subordinate Serial Bonds plus the aggregate amount of Mandatory Sinki ng Account Payments requi red to be paid into the respective Sinking Accounts for Outstanding Subordinate Term Bonds, in each case during the next ensuing twelve months, tiun l the balance in saidac count is equal to said aggregate amountof such principal and Mandatory Sinking Account Payments; provided thatduri ng the period from the date of deliveryof a series of Subordi nate Bands until the first pri ncipal pay mentdate for such series (if less than twelve months), such transfers will be sufficient on a monthly pro rata basis to pay the aggregate amount of pri nci pal becomi ng due and payable on the fi rst principal payment date for such series.

(G) On or before the first day of each month, to the Subordi nate ReserveAccoun t (which the Trustee wi ll establ ish and maintai n in the Revenue Fund), an amount equal to either: (i) an amount equal to the amount, if any, necessary to restore the amount on deposit in such account to the Subordi nate Reserve Account Requirement, or (ii) the amount necessary to repay any and al l obl igations due and payable under the terms and conditions of any letter of credit provided for in the Indenture or any insurance pol icy provided for in the Indenture. No deposit need be made into the Subordi nate Reserve Account so longas the balance in sai d account wi ll be at least equal to the amount required by the Indenture to beon depositther ein.

(H) On or before June 30 in each year, commencing June 30, 2004, to the Bulldog Foundation Repayment Account (which the Corporation wi ll establ ish and mai ntai n) that amount, if any, specified in a Written Request of the Corporation fi led with the Trustee as being the amount then due and payable to the Bulldog Foundation pursuant to the Bul ldog Foundation Agreerrent.

B-10 (I) On J uly 2 in each year, after al I of the foregoi ng transfers requi red by the I ndenture have been made in ful l, any remai ni ng Event Center Proj ect Revenues will be deposited into the Surpl us Account (which the Trusteewi ll establ ish and maintai n within the Revenue Fund) .

Application of Funds and Accounts

Construction Fund. The Trustee wi ll establ ish, mai ntain and hold in trust a separate fund to be knownas the "Construction Fund." The rmneys in the Construction Fund wi ll be appl ied to the pay mentof Proj ect Costs of the Series 2002 Proj ect. The rmneys in the Construction Fund will be applied to acquire the Series 2002 Proj ect in accordance with the Indenture.

Costs of Issuance Fund. The Trustee wi ll establish, mai ntai n and hold in trust a separate fund to be known as the "Costs of Issuance Fund." The rmneys in the Costs of Issuance Fund wi ll be appl ied to the pay mentof Costs of Issuance and all other expenses in connection with the preparation, issuance and del iveryof the Bonds, legal fees and expensesof counsel , and si milar expenses.

Upon the earl ier of six rmnths fol lowing the issuance of the Series 2002 Bonds, or the filing of a Statementof the Corporation with the Trustee tothe effect that all Costs of Issuance have been paid, any remai ni ng balance in the Costs of Issuance Fund will betransferred to the ConstructionFu nd.

Interest Accounts. All armunts in theSe nior Interest Account wi ll be used andwithdr aw n by the Trustee solely for the purpose of paying the interest on theSe nior Bonds as it becomes due and payable (incl udi ng accrued interest on any Senior Bonds purchased or redeemed prior to mat urity pursuant to the Indenture). All armunts in the Subordinate Interest Account wi ll be used and withdrawn by the Trustee solely for the purpose of pay ing the interest on the Subordinate Bonds as it becomes due and payable (includi ng accrued interest on any Subordinate Bands purchased or redeemed prior to maturity pursuant to the Indenture) .

Princi pal Accounts. All armunts in the Senior Principal Account will be used and withdrawn by the Trustee solely for the purposesof pay ing the pri nci pal of the Senior Bonds when due and payable, except that al l armunts in the Senior Sinki ng Accounts wi ll be usedand withdrawn by the Trustee solely to purchase or redeem or pay at maturity Senior Term Bonds, as provided in the Indenture. All armunts in the Subordi nate Principal Account wi 11 be usedand withdraw n by the Trustee solely for the purposesof pay ing the pri nci pal of the Subordinate Bands when due and payable, except that al l armunts in the Subordi nate Sinki ng Accounts wi ll be used and withdraw n by the Trustee solely to purchase or redeemor pay atmat urity Subordinate Term Bands, as provided in the Indenture.

Reserve Accounts. All armunts in the Senior ReserveAccoun t (incl uding armuntsobtai ned from letters of credit or insurance policies on deposit therein) wi ll be used and withdrawn by the Trustee solely for the purpose of making up any deficiency in the Senior Interest Account or Senior Principal Account or (together with any otherrmneys av ailable therefor) for the payment or redemption of all Senior Bonds then Outstanding.

In lieu of replenishing the Senior Reserve Account Requirement, or in replacement of rmneys then on deposit in the Senior ReserveAccoun t, the Corporation may deliver to the Trustee (a) an irrevocable letter of credit issued by a fi nancial institution hav ing unsecured debt obl igations which are rated at least "A" or equivalent by a Rating Agency or (b) an insurance pol icy issued by an insurance company whose unsecured debt obl igations (or for which obl igations secured by such insurance company' s insurance policies) are rated at least "A" or equivalent by aRati ng Agency, all as rmreful ly descri bed in the Indenture.

All armunts in the Subordi nate Reserve Account (including armunts obtai ned from letters of credit or insurance policies on deposittherei n) will be used and withdrawn by the Trustee solely for the purpose of making up any deficiency in the Subordi nate Interest Account or Subordi nate Principal Account or (together with any otherrmneys av ai I able therefor) for the payment or redemption of al I Subordi nate Bands thenOu tstanding.

In lieu of replenishing the Subordinate Reserve Account Requirement, or in replacement of rmneys then on deposit in the Subordinate Reserve Account (which wi ll be transferred by the Trustee to the Corporation), the Corporation may deliver to the Trustee (a) an irrevocable letter of credit issued by a fi nancial

B-11 institution having unsecured debt obligations which are rated atle ast "A" or equivalent by aRati ngAge ncy or (b) an insurance policy issued by an insurance company whose unsecured debt obl igations (or for which obl igations secured bysuch insurance company's insurance pol icies) are rated at least "A" or equivalent by aRa ti ng Agency, al l as more fully described in theI ndenture.

Capital ReplacementAccoun t. All amounts on deposit in the Capital Replacement Account may be withdrawn by the Corporation, from ti me to time, (i) for the payment of the costs of acquisition, construction, rehabi litation, repai r, replacement or improvement of the Event Center Project or other faci lities acquired or constructed with the proceeds of the Parity Senior Debt or (ii) to satisfy any deficiency in any of the other funds establ ished pursuant to the provisions of the Indenture described above in subsection "Allocation of Event Center Proj ect Revenues'' (in the order of priority establ ished by said subsection).

Bulldog Foundation Repayment Account. All amounts on deposit in the Bulldog Foundation Repayment Account wi ll be withdrawn by the Corporation on or before June 30 in each year, commencing with June 30, 2004, and paid to the Bulldog Foundation in order to repay any amounts then due and payable to the Bulldog Foundation pursuant to the Bul ldog Foundation Agreement.

Surpl us Account. So long as no Event of Default (as specified in the Indenture) has occurredor is continuing and the Senior Series 2002 Bonds are Outstanding, the Trustee will retai n within the Surpl us Account al l amounts deposited therein unti l the amount on deposit equal s $5,000,000, and, thereafter, the Trustee wi ll: (i) deposit 5QJ,.,6 of the amount in excess of such $5,000,000on J uly 2 in each year into the Senior Optional Redemption Account and apply such amount (together with such $5,000,000) to the redemption of Senior Bonds on their fi rst optional redemption date in accordance with the Indenture (or to the prior purchase of Senior Bands in accordance with the Indenture) ; and (ii) apply 5QJ,.,6 of the amount in excess of such $5,000,000on J uly 2 in each year to any of the followi ng purposes, as may bespecifie d in a Written Request of the Corporation: (a) to satisfyany deficiency in any of the other funds establ ished pursuant to the provisions of the Indenture described above in subsection "Allocationof Event Center Proj ect Revenues'' (in the order of priority establ ished by said subsection), (b) to pay Operating Expenses or (c) if, as set forth in a Certificate of the Corporation fi led with the Trustee, (1) the Debt ServiceCover age Ratio for the precedi ng Fiscal Year is at least 1.40 and (2) the Contractual ly Obligated Income Coverage Ratiois at least 1.00 for the 24-rronth period immediately following such distribution, for distribution to the Corporation for use for any lawful purpose.

Rederrption Funds. The Trustee wi ll establ ish and maintai n within the Senior Redemption Fund (which the Trustee wi ll establ ish, mai ntai n and hold in trust) a separate Senior Optional Redemption Account and a separate Senior Special Redemption Account. All amounts deposited in the Senior Optional Redemption Account and in the Senior Special Redemption Account wi ll be used and withdrawn bythe Trusteesolely for the purposeof redeeming Senior Bands, in the mannerand uponthe terms and conditions specified in the Indenture.

The Trustee will establ ish and mai ntai n within the Subordi nate Redemption Fund (which the Trustee will establ ish, maintain and hold in trust) a separate Subordinate Optional Redemption Account and a separate Subordinate Special Redemption Account. All amounts deposited in the Subordi nateOpti onal Redemption Account and in the Subordi nate Special Redemption Account wi ll beused and withdrawn bythe Trustee solely for the purpose of redeeming Subordi nate Bonds, in the manner and upon the terms and conditions specified in the Indenture.

Rebate Fund. The Trustee wi ll establ ish and mai ntai n the Rebate Fund as a fundseparate from any other fund established and mai ntai ned under the I ndenture. Subject to the transfer provisi ans provided in the Indenture, al l money at any time deposited in the Rebate Fund will be held by the Trustee in trust, to the extent requi red to satisfy the Rebate Requirement (as defi ned in the Tax Certificate), for payment to the federal government of the United States of America, and neither the Corporation nor the Holders of any Bondsshal l have any rights in or claim to suchmoney .

Investment of Moneys in Funds and Accounts. Subject to the provisions of the Indenture, al l moneys in any of the funds and accounts establ ished pursuant to the I ndenture and held by the Trustee wi II be invested bythe Trustee solely in Investment Securities.

B-12 Unless otherwise provided in a Supplemental I ndenture for a series of Bands issued pursuant to such Supplemental Indenture, al I interest, profitsand other income received from the investment of rmneys in any fund or account held by Trustee under the Indenture will be deposited when received in the Event Center Proj ect Revenue Fund; provided, however, that al l such interest, profits and other income received with respect to (i) the Construction Fund and the Senior Series 2002 Capitalized Interest Account or the Subordinate Series 2002 Capitalized Interest Account will be retai ned in such fund or account; (ii) the Senior Reserve Account and the Subordinate Reserve Account will be deposited into the Senior Series 2002 Capitalized Interest Account and the Subordinate Series 2002 Capital ized Interest Account unti l July 1, 2004, and thereafter will be deposited into the Revenue Fund; and (iii) the Surpl us Account wi II bedeposited in to the Subordi nate Interest Account.

Covenants of the Corporation

Maintenance of Title to Event Center Project; Amendment of Security Documents. The Corporation will pay or cause to be paid al l taxes, assessments and other charges, if any, that may be levied, assessed or charged upon theTrust Estate, or any part thereof, promptly as and when the same becomes due and payable; and the Corporationwi ll, upon the request of the Trustee, from time to time keep the Trustee advised of such payments, and furnish to the Trustee a certificate on or before July 1 of each year to the effect that the requirementsof this section have been complied with. The Corporation will not suffer the Event Center Project or any part thereof: (a) to besold for any taxes, assessmentsor other charges whatsoever, or to beforf eited therefor; (b) to be subjected to any deed of trust or other security interest other than the Deed of Trust or Permitted Encumbrances; nor do or permitto be done in, upon or about the Event Center Proj ect, or any partthereof, anything that might in anyway weaken, diminish or impai r the security intended to be given bythe Indenture.

The Corporation will not alter, modifyor cancel, or agree or consent to alter, rmdify or cancel, the Security Documents without the written consent of the Holders of a maj ority in aggregate pri ncipal armuntof Bands then outstanding; provided, however, that the Corporation may , without notice to or the consent of any Holders of the Bonds, consent to alterationsor rmdifications thereofwhich would not have a Material Adverse Effect on the interests of the Holders of the Bands then outstanding.

Without allowance for any days of grace which may or might exist or be al lowed by law or granted pursuant to any terms or conditions of the Security Documents,the Corporation will in al l respects promptly andfai thfully keep, perform and comply with al l the terms,pr ovisions, covenants, conditions and agreementsof the Security Documentsto be kept, performed and complied with by it. The Corporationwi ll not do or perrritany thing to be done, or orritor refrai n from doing anything, in the case where any such act done or permitted to be done, or any such omission of or refrai ning from action, would or rri ght be aground for declaring a forfeiture of any Security Documentor an event of default on the part of the Corporation under any Security Document. The Corporationwi ll promptly deposit with the Trustee (to be held by the Trustee until the title and rights of the Trustee under the Indenture shal l be released or reconveyed) any and all documentary evidence received by it showing compl iance with the provisions of the Security Documentsto be performed bythe Corporation. The Corporation, immediately upon its receiving or giving any notice, communication or other document in any way relati ng to or affecting the Security Documents, which may or can in any manneraffect either the estate of the lessor or of the Corporation in or underthe Ground Lease or the rights and obligations of the partiesto any Security Document, or any portionof the Trust Estate, will del iver the same, or a copythereof, to the Trustee. If the Corporation fai ls to take action required bythi s paragraph the Trustee may (but shal l be under no obligation to) take such action and charge the Corporation for all costs incurred in connection therewith.

Additional Financial Covenants.

(a) No Superior Lien. The Corporation shall not create or give, or permit the creation or giving of, any priority for pay ment, rmrtgage, lien, pledge or encumbrance on Event Center Proj ect Revenues that is prior to the payment of the Senior Bonds due under the Indenture. To theextent provided in the Indenture, the Corporation may incur Parity Senior Debt and Parity Subordi nate Debt secured on a pari passu basis by Event Center Proj ect Revenues.

B-13 (b) Issuance of Parity Debt. The Corporation shall not issue Parity Senior Debt or Parity Subordinate Debt unless the requirements in the Indenture have been satisfied with respect to the incurrence of such Parity Senior Debt or Parity Subordi nate Debt.

( c) Rate Covenant. ( 1) The Corporation shal I fix, charge and collect, or cause to be fixed, charged and collected, subject to appl icable requirements or restrictions imposed by law, such rates, fees, charges and prices for use, occupancy and operations of the Event Center Project and other goods and services and charges which, togetherwith al l Event Center Proj ect Revenues of theCorpora tion, wi ll bebudgeted for the next Fiscal Year to be sufficient to produce Net Event Center Proj ect Revenues Avai lable for Debt Serviceequal to at least (i) one andforty -hundredths ( 1.40) timesAgg regate Annual Debt Service for the Senior Bands and al l Parity Senior Debt then Outstanding for the next Fiscal Year; and (ii) one ( 1) ti mesAggr egate Annual Debt Service on al l Parity Senior Debt and Parity Subordinate Debt then outstandi ng for the next Fiscal Year. (2) On or before J une 1 in each year, commencingJ une 1, 200_, the Corporation shall fi le with the Trustee a Statementof the Corporation calculati ng the ratioof Net Event Center Project Revenues Avai lable for Debt Serviceto Aggregate Annual Debt Service for the Senior Bonds and all Parity Senior Debt then Outstanding for the immediately succeeding Fiscal Year. If the Corporation fi les a Statement of the Corporation pursuant to the Indenture that sets forth a ratio of less than 1.40, the Corporation shal l promptly retain the services of a Event Center Consultant. Such Event Center Consultant shal l examine the rents, fees and prices as wel l as the Operating Expenses for the Event Center Proj ect and shal l fi le a reportwith the Trustee and the Corporation contai ni ng recommendations of actions that may increase the amount of Net Event Center Proj ect Revenues Avai lable for Debt Service. (3) TheCorpora tion shall fix, charge and col lect, or cause to be fixed, charged and collected, subject to appl icable requirements or restrictions imposed by law, such rates, fees, charges andprices for the use, occupancy and operationsof the Event Center Proj ect and other goodsand services and charges which, together with all Event Center Proj ect Revenues of the Corporation, will be budgeted for the next Fiscal Year to be sufficient to produce Net Event Center Proj ect Revenues Avai lable for Debt Service equal to at least one (1) ti mes Aggregate Annual Debt Service for the Senior Bonds, the Subordinate Bonds, al l Parity Senior Debt and al l Parity Subordi nateDebt then Outstanding for thenext Fiscal Year.

(d) Limitation on Gifts. In any Fiscal Year the Corporation wi ll not transfer without consideration any moneys held in the Event Center Proj ect Revenue Fund to the Board, the University or any other auxi liary organization of the Board unless al l Bond and Parity Senior Debt and Parity Subordinate Debt pay mentsto bemade duri ng such Fiseal Year have been made.

(e) Other Permitted Indebtedness. Except as otherwi se provided in the Indenture with respect to Additional Bonds, Parity Senior Debt and Parity Subordi nate Debt, the Corporation may incur and have outstanding (i) Non-Recourse Indebtedness, and (ii) Indebtedness which is unsecured, and (iii) Indebtedness secured by student housing revenues derived from student housi ng projects owned or operated bythe Corporation.

(f) Corrpletion and Operation of Events Center Project. The Corporation wi ll diligently cause the construction, acquisition and improvement of the Event Center Proj ect to proceed to timelycompletion. The Corporationwi ll operatethe Event Center Proj ectas a fi rst-class sportsand entertai nmentfa cility comparabl e to si milar venues in the United States.

(g) Change Orders. The Corporation will not approve any change orders concerning the Proj ect unless prior to such approval the Corporation has fi led with the Trustee a Certificate of the Corporation stati ng the cost of the change order and the source of funds from which such costs wi ll be paid and confi rmi ng that the Corporation has sufficient funds to complete the Proj ect, as modified by such change order.

(h) Change to Required Insurance Coverage Duri ng Construction. The Corporationwi ll not modify any of the insurance requi red to be mai ntai ned during the construction of the Proj ect, as set forth in the Proj ect Documents or elsewhere, without the prior written approval of the Holders of a maj ority in aggregate pri nci pal amount of Bondsthen outstanding; provided, however, that the Corporation may , without notice to or the consent of any Holders of the Bands, consent to alterations or modifications thereof which would not have a Material Adverse Effect on thein terests of the Holders of the Bonds then outstanding.

Annual Budget for the Event Center Project. On or before June 1 of each year the Corporation wi ll fi le with the Trustee a written budget describi ng in reasonable detai l the anticipated Event Center Proj ect

B-14 Revenues, Operating Expenses and other financial information relevant to the financial performance of the Event Center Proj ect(in cluding withoutli mitation the rate covenants set forth in the Indenture) for suchFi scal Year.

Maintenance and Operation of the Event Center Project. The Corporation will mai ntain and operate the Event Center Proj ect as a multi-purposeevents center serving the students, faculty and staff of California State University, Fresno (or otherwi se sati sfying the publ ic and charitable purposes of the Corporation) and will maintai n and operate the same, and all engines, boilers, pumps, machinery, apparatus, fixtures, fittings and equipmentof any ki nd in or that will be placed in any bui lding or structure at any timeconsti tuti ng partof the Event Center Project which is material to the operation of the Event Center Project in good repai r, working order and condition, and that it will from timeto time make or cause to be made al l needful and proper replacements, repai rs, renewal s and improvements so that the efficiency and val ue of the Event Center Proj ect will not be materially adversely impai red.

Tax Covenants. The Corporation covenants that it will not take any action, or fai l to take any action, if any such action or fai lure to take action would adversely affect the exclusion from gross income of the interest on the Bonds under Section 103 of the Code. The Corporationwi ll not directly or indirectly use or perrrit the use of any proceedsof the Bands or any other funds of the Corporation, or take or orritto take any action that would cause the Bonds to be "arbitrage bonds'' within the meaning of Section 148(a) of the Code to the extent applicable to the Bonds. To that end, the Corporationwi ll comply with all requirementsof Section 148 of the Code to the extent appl icable to the Bonds. In the event that at any time the Corporation is of the opinion that for purposes of this section it is necessaryto restrict or limit the yield on the irwestment of any moneys held by the Trustee underthe Indenture, the Corporation will so instruct the Trustee in writing, and the Trustee will take action in accordance with such instructions. Without limiting the general ity of the foregoing, theCorpora tion agrees that there will be paid from time to time al l amounts required to be rebated to the United States pursuant to Section 148(f) of the Code and any temporary, proposed or fi nal Treasury Regulations as may be applicable to the Bands from ti meto ti me. This covenantwi 11 survive paymentin ful I or defeasanceof the Bands. The Corporation specifical ly covenants to pay or cause to be paidto the United States at the timesand in the amounts determined underthe Indenture, pursuant to the Rebate Requirement,as described in the Tax Certificate. The Trustee agrees to complywith al l instructions of the Corporation given in accordance with theTax Certificate. The Corporation will atal l timesdo and perform al l acts and things perrritted by law andthe Indenture which are necessary or desi rable in order to assure that interest paid on the Bonds (or any of them) will be excluded from gross income for federal incometax purposesand wi ll take no action thatwould result in such interest not bei ng excluded from gross income for federal incometax purposes. Any other obligation issued bythe Corporationeither to makeim provementsto the Series 2002 Proj ect or to refund the Bonds will be discharged no later than the latest mat urity date of the original obligations, regardless of whether the original obligations are cal lable at an earl ier date. The Corporation will maintai n its status as an organization described in Section 501(c)(3) of the Code and its exemption from federal incometax under Section SOl(a) of the Code. The Corporation will not use or perrritthe use of the Series 2002 Proj ect by any person not a "governmental unit'' or not a "501(c)(3) organization" within the meaning of Section 150 of the Code or by a "501(c)(3) organization" in "unrelated trade or business" within the meaning of Section 513(a) of the Code in such manner or to such extent as would result in loss of the exclusion from gross incomeof interest on any of the Bands under Section 103 of the Code. In particular, at least 9Ql,.,6 of the proceedsof the Bonds (net of reserve funds) will be used to provide facilities owned and operated byorgan izations described in Section 501(c)(3) of the Code or by governmental units. Notwithstanding any provision of the Indenture, if the Corporationwi ll provide the Trustee an opinion of Bond Counsel to the effect that any action required under the Indenture is no longer required, or to the effect that some further action is required, to mai ntai n the exclusion from grossin comeof the interest on theBo ndspursuant to Section 103 of the Code, the Corporation and the Trustee may rely conclusively on such opinion in complying with the provisions of the Indenture, and the covenants underthe I ndenture wi 11 bedeemed to be modifiedto thatextent.

Managementof the Event Center Project. The Event Center Proj ect will be managed, initially, by the Event Center Manager pursuant to the termsof the ManagementAgr eement. In the event that, in any year, the rate covenantsset forth in the Indenture shal l not besat isfied, the Corporation will determine whether to replace the Event Center Manager as managerof the Event Center Proj ect. If the Event Center Manager is in default under the Management Agreement, theCorpora tion may replace the Event Center Manager as manager of the Event Center Proj ect; provided, if theCorpora tion has not replaced the Event Center Managerwithi n 90day s of a default by the

B-15 Event Center Manager under the Management Agreement which default remai ns uncured, the Corporation wi ll thereupon replace the Event Center Manager as manager of the Event Center Proj ect.

Observance of Laws and Regulations; ERISA. The Corporationwi ll well and truly keep, observe and perform al l val id and lawful obligations and regulations imposed on it by contract, or prescri bed by any law of the United States of America, or of the State of Cal ifornia, or by any officer, board or commission having jurisdiction or control , as a condition of the conti nued enjoyment of any and every right, privilege or franchise owned or hereafter acquired bythe Corporation, includi ng its right to exi st and carry on business as a corporation,to the endthat such contracts, rights and franchi ses wi ll be rrai ntai ned and preserved, and wi ll not become abandoned, forfeited or in any manner impai red. The Corporation wi ll comply with the mi nimum fundi ng requi rements of ERISA with respectto any retirement plan of the Corporation that is subject to ERISA.

Maintenance and Repai r of Event Center Project. The Corporationwi ll maintai n or cause to be maintai ned in good condition and keep in good repai r the Event Center Proj ect and will maintai n the Event Center Proj ect as a fully equi pped and operational facility, and wi ll not commit or al low any waste with respect to any of the Event Center Proj ect.

Other Liens. TheCorporation wi ll keep the Trust Estate and al l parts thereoffree from judgments, mechanics' and materialmen' s liens and free from al l liens, clai ms, demandsand encumbrances of whatsoever prior nature or character, except for Permitted E ncurnbrances, to the end that the priority of the I ien of the Indenture may at all ti mes be rrai ntai ned and preserved, and free from any claim or liabi lity which, in theju dgment of the Trustee (and its deterrri nationther eof wi ll be fi nal), might embarrass or hamperthe Corporation in conducti ng its busi ness or operati ngthe Trust Estate, and the Trustee at its option (after fi rst giving the Corporation 10 days' written notice to comply therewith and fai lure of the Corporationto so complywithi n saidten-da y period) may (but wi ll not be obl igated to) defend agai nst any and al l actions or proceedings in which the val idity of the Indenture or its priority is or might be questioned, or pay or comprorri se any clai m or demand asserted in any such actions or proceedings; provided, however, that, in defending against such actions or proceedings or in pay ing or compromising such claims or demands, the Trustee wi ll not in any event be deemed to have waived or released the Corporationfrom liabi lity for or on account of any of its covenants and warranties contai ned in the Indenture, or from its liabil ity under the Indenture to defend the val idity or priority of the Indenture and the lien thereof and to perform such covenants and warranties.

So long as any Bonds are outstanding, the Corporation wi ll not create or suffer to be created any rmrtgage, pledge, lien or charge upon all or any part of the Trust Estate, the Event Center Proj ect or the Event Center Project Revenues, on a senior or parity lien to the lien of the Indenture, except the Deed of Trust and any rmrtgage, pledge, I ien or charge expressly permitted by the Indenture.

The Corporation may incur Non-Recourse Indebtedness without any limitation under the Indenture.

Insurance Required. The Corporation shal l mai ntai n or cause to be rrai ntained, at all ti mes (incl udi ng without limitation during the course of construction of the Proj ect) while any of the Bonds are Outstanding, fire, lightning, and extended coverage insurance, including vandal ism and mal icious mischief insurance, spri nkler system leakage insurance, and, followi ng completion of construction of al l structures constituti ng any part of the Event Center Proj ect, earthquake insurance (if the Corporation in its discretion determi nes that earthquake insurance is available on the open market from reputable insurance companies at reasonable cost) , either as a part of comprehensive insurance carried by the Corporation or as a part of insurance carried by a contractor under a construction contract, on al l structures constituti ng any part of the Event Center Proj ect, in an armunt equal to one hundred percent (fifty percent in the case of earthquake insurance) of the replacementcost of such structures (except that such earthquake insurance may be subject to a deducti ble clause of not to exceed ten percent of such replacement cost for any one loss and except that such other insurance may be subject to deducti ble clauses for any one loss of $100,000) or, in the alternative, in an armunt and in a form sufficient (together with rmneys in the Reserve Account and avai lable for that purpose), in the event of total or partial loss, to enable the Corporation either to reti re al l Bonds and al l Parity Senior Debt and Parity Subordi nate Debt then Outstanding or to restore such structures to the condition exi sti ng before such loss. Said extended

B-16 coverage endorsement shal l, as nearly as practicable, cover loss or damage by explosion, wi ndstorm, riot, ai rcraft, vehicle damage, srmke and such other hazards as are normal ly covered by suchendorse ment.

In the event of any damage to or destruction of any partof the Event Center Proj ect, caused by the perils covered by such insurance, the Corporation, except as provided in the Indenture, shal l cause the proceeds of such insurance to be payable to the Corporation and such proceeds shall be utilized for the repair, reconstruction or replacement of thedamaged or destroyed portionof the Event Center Proj ect to at least the samegood order, repai r and condition as it was in prior to the damage or destruction, insofar as the same may beac compl ished bythe use of such proceeds. Alternatively, the Corporation, at its option and if the proceeds of such insurance together with any other rmneys then avai lable for the purpose are at least sufficient to redeem Outstanding Bonds in authori zed denorri nations, may elect not to repai r, reconstruct or replace the damaged or destroyed portionof the Event Center Proj ect and thereupon shal l cause sai d proceeds to be deposited fi rst in the Senior Optional Redemption Account within the Senior Redemption Fund and second in the Subordi nate Optional Redemption Account within the Subordinate Redemption Fund and used for therede mption of Outstanding Bands pursuant to the Indenture.

Except as provided in the nextsucceed ing paragraph, theCorpora tion shal l mai ntai n or cause to be maintai ned, at al l ti meswhi le any of the Bonds are Outstanding, publ ic liability insurance, with limits of not less than $5,000,000 combined single limit, to protect the Corporation and its ITEmbers, directors, officers, agents and employees from al l direct loss or liabi lity for damages for bodilyin jury or property damage occasioned by reason of the Corporation's operations, including any use or occupancy of the Event Center Proj ect. Such publ ic liabil ity insurance may besub jectto a deducti ble clause of not to exceed $50,000for any one accident.

The Corporation shal l have the right, exercisablefrom ti me to ti lTE but to provide other ki nds of insurance or ITEthodsor plans of protection agai nst risk or loss which shal l be in substitution, or partial substitution, for any of the kinds of insurance required to be maintai ned by the Corporation underthe Indenture, providing such other ki nds of insurance, plans or methods shall afford reasonable protection to the Corporation, its members, directors, officers, agents and employees in light of al l circumstances giving consideration to cost, avai labi lity and plans or methods of protection adopted by Cal ifornia corporations si milar to the Corporation. Before another method or plan may be provided by the Corporation, there shal l be filed with the Trustee a Certificate of the Corporationto the effect thatthe substitute method or plan of protection is in accordance with the requi rements of this section and, when effective, would afford adequate protection to the Corporation, its members, di rectors, officers, agents and employees agai nst loss and damage from hazards and risks covered thereby and setting forth the details of such substitute method or plan.

The Corporation shal l mai ntai n or cause to be mai ntai ned, rental interruption or use and occupancy insurance to cover loss, total or partial, of the Event Center Proj ect Revenues from the rental or use of the Event Center Proj ect as the result of any of the hazards covered bythe insurance required by the Indenture (provided with respect to earthquake insurance, only if avai lable at a reasonable annual premi um on the open market from reputable insurance companies, al l as reasonably determi ned by the Corporation), in an armunt sufficient to pay Maxi mum Aggregate Annual Debt Service for a period of at least twelve rmnths, except that such earthquake insurance may besub ject to a deducti ble clause of not to exceed ten percentof such insured armunt for any one loss and except that such insurance may be subject to a deducti ble clause of not to exceed $100,000 or a comparable armunt adj usted for inflation (or rmre in the case of earthquake insurance). Any proceeds of such insurance shal l be used bythe Trustee for deposit fi rst to theSenior Interest Account or Senior Principal Account and second to the Subordinate I nterest Account or Subordinate P ri nci pal Account established pursuant to the I ndenture.

The Corporation shall at theti meof the issuance of the Series 2002 Bonds purchase or cause to be purchased title insurance, in the form of a CL TA policy of title insurance, insuring the interests under the Deed of Trust in an aggregate armunt not I ess than the aggregate pri ncipal armuntof the Seri es 2002 Bands.

The insurance policies requi red bythe Indenture wi 11 becarried by insurance companies which are fi nancially responsible and capable of fulfilling the requirements of such policies. All such policies shal l name the Corporation, theTrus tee and the Board as insured parties, beneficiaries or loss payees as their interests may appear. Each policy shal l be in such form and contai n such provisions as are general ly considered standard for the type of insurance involved and shal l contain a provision to the effect that the insurer shal l not cancel or substantial ly rmdify the policy provisions without first giving written notice thereof to the Corporation. In lieu of separate pol icies, the

B-17 Corporation may mai ntai n blanket policies which coverany one or rmre ri sks requi red to be insured against so long as the mi ni mum coverages required in the Indenture are met. At least annual ly, commencing on the date of the original deliveryof the Bonds, the Corporation shal l file with the Trustee a Statement setting forth the policies of insurance mai ntai ned pursuant to the Indenture, the names of the insurers and insured parties, the armunts of such insurance and appl icable deducti bles, the risks coveredthereby andthe expi rationdates thereof and representi ng that the requirements of this section have been satisfied. The Corporation shal l al so fi le with the Trustee a copy of any insurance review or recommendations received by the Corporation from the Insurance Consultant pursuant to this section. TheTrus tee shal l not be responsible for the coverage or armuntsof such insurance.

Insurance and Condemnation Proceeds.

In the event of any damageto or destruction of any part of the Event Center Proj ect caused by the perils covered bythe insurance requi red to mai ntai ned pursuantto theIn denture, theCorporation wi ll, subjectto the provisions of the Indenture, cause the proceeds of such insurance to be utilized for the repai r, reconstruction or replacement of the damaged or destroyed portion of the Event Center Project. Any of said proceeds not used for such repair, reconstruction or replacement as authorized by the Indenture wi ll be appl ied in the fol lowing order of priority: first, proportionately (a) to prepay or redeem Parity Senior Debt and (b) for deposit in the Senior Optional Redemption Account within the Senior Redemption Fund to redeem Senior Bonds pursuant to provisions of the Indenture; second, proportionately (c) to prepay or redeem Parity Subordinate Debt and (d) for deposit in the Subordinate Optional Redemption Account within the Subordinate Redemption Fund to redeem Subordi nate Bonds pursuant to provisions of the Indenture. For purposes of the immediately preceding sentence, said proceeds wi ll be applied fi rst in the same proportion as the unpai d principal armunt of Parity Senior Debt bearsto the unpaid and Outstanding principal armuntof Senior Bonds and second in the same oportionpr as the unpaid principal armuntof Parity Subordi nate Debt bearsto the unpaid and Outstanding pri nci pal armuntof Subordinate Bonds.

If all or any portionof the Event Center Proj ect is taken by emi nent domai n proceedings (or sold to a governmentth reateni ng to exercise the powerof eminent domai n) and the Corporation shal l have certified to the Trustee that such emi nent domain proceedings shal l not have materially affected the abi lity of the Corporation to meet its obl igations under the Indenture, the Corporation wi ll cause the proceeds of said proceedingsto be utilized for the repai r or rehabilitation of the Event Center Project. Any of said proceeds not utilized for such repai r or rehabi litation wi ll beappl ied in the fol lowi ng order of priority: fi rst, proportionately (a) to prepay or redeem Parity Senior Debt and (b) for deposit in the Senior Optional Redemption Account within the Senior Redemption Fund to redeem Senior Bonds pursuant to the Indenture; second, proportionately (c) to prepay or redeem Parity Subordi nate Debt and (d) for deposit in theSu bordi nateOpti onal Redemption Account within the Subordi nate Redemption Fund to redeemSu bordinate Bonds pursuant to the Indenture. The proportion to be so appl ied wi ll be determi ned in the samemanner as specified in the I ndenture.

Events of Default and Remedies

Events of Default. If one or rmreof the followi ng events (herein called "Events of Default'' ) shal l happen,that is to say -

(a) lftheCorpora tion fails to pay any Senior Bond pay mentswhen due and payable;

(b) If theCorpor ation fai ls to pay any Subordi nate Bond pay mentswhen due and payable at a ti me when rmneys are avai lable to make such pay ments in the Subordinate Interest Account, the Subordinate Princi pal Account or the Subordi nate ReserveAccount;

(c) If the Corporation fai ls to comply with the provisions of the Indenture, insofar as such provisions relate to the security and payment for the Bonds and any Parity Senior Debt, and written notice, specifying such fai I ure and requesti ng thatit beremedied, has beengiven to the Corporation bythe Trustee;

(d) If any representation orwarranty made by the Corporation in the Indenture or made by the Corporation in any document, instrument or certificatefurni shed to the Trustee in connection with theexec ution

B-18 and delivery of the Bondsor theconstruc tion and acquisition of the Event Center Proj ect will at anyti me proveto have been incorrect in any rnaterial respectas of the ti me made;

(e) If the Corporation fai ls to observe or perform any covenant, condition, agreerrent or provision in theI ndenture, on its part to be observed or performed, other than as referred to in subsection ( c) or ( d) of this section, or breaches any warranty bythe Corporation contai ned in the Indenture, for a periodof 60 daysaf ter written notice, specifying such failure or breach and requesting that it be rerredied, has been given to the Corporationby the Trustee; except that, if such fai lure or breach can be remedied but not within such 60day period and if the Corporation has diligently attempted to remedy suchfai lure or breach within such 60 day period, such failure or breach will not becomean Event of Default for so long as the Corporation diligently proceeds to remedy same;

(f) If any default exi sts under any agreement governing any Parity Senior Debt and such default continues beyondthe grace period, if any, provided for with respectto such default;

(g) If default is made bythe Corpora tion in theobservance of any of the covenantson its part contained in the Project Docurrents, the Ground Lease or the Deed of Trust; or

(h) If the Corporation files a petition in vol untary bankruptcy, for the composition of its affairs or for its corporate reorganization under any state or federal bankruptcy or insolvency law, or makes an assignment for the benefitof creditors, or admits in writing to its insolvency or inabi lity to pay debts as they mature, or consents in writing to the appoi ntmentof a trusteeor receiver for itself or for the whole or any substantial partof its property;

(i) If a court of competent jurisdiction enters an order, judgment or decree declaring the Corporationan insolvent, or adjudgi ng it bankrupt, or appoi nting a trustee or receiver of the Corporation or of the whole or any substantial part of its property, or approving a petition filed agai nst the Corporation seeking reorganization of the Corporation underany appl icable law or statute of the United States of America or any state thereof, and such order, judgrrent or decree is not be vacated or set aside or stayed within 60day s from the date of the entry thereof;

U) If, under the provisions of any other law for the rel ief or aid of debtors, any court of competentju ri sdiction will assume custody or control of the Corporationor of the whole or any substantial part of its property, and such custody or control will not betermi nated within 60 daysfrom the date of assumption of such custody or control.

Notwithstanding the foregoing, fai lure to make adeposit required by the sixth, seventh and eighth paragraphs under the subsection captioned "Allocation of Event Center Proj ect Revenues'' above will not constitute an Event of Default unless there are sufficient Event Center Proj ect Revenues available to makesuch deposit.

Upon having actual notice of the existence of an Event of Default, the Trustee will servewritten notice thereof uponthe Corporation unless the Corporation has expressly acknowledged theexi stence of such Event of Default in a writing delivered bythe Corporation to the Trustee or filed bythe Corporation in any court.

Any such declaration, however, is subject to the condition that if, at any tirre after such declaration and before any judgment or decree for the pay ment of the moneys due will have been obtai ned or entered, there will bedeposited with the Trustee a sum sufficient to payal l Bond pay mentsthe pay mentof which are overdue, with interest, and the reasonable fees, charges and expenses of the Trustee (including those of its attorneys) , and any and al I other defaults knownto the Trustee ( other than in the pay mentof theBa nd paymentsdue and payable solely by reason of such declaration) will have been made good or cured to the satisfaction of the Trustee or provision deemed by the Trustee to be adequate will have been madetherefor, then, and in every such case, the Holders of not less than a maj ority in aggregate principal amount with respect to the Bonds then Outstanding, bywritten notice to theCorpora tion and the Trustee, or the Trustee if such declarationwas made bythe Trustee, may , on behalfof the Holders of al l of the Bonds, rescindand annul such declarationand its consequences

B-19 and waive such default; but no such rescission and annulmentwi ll extend to or will affect any subsequent default, or wi 11 impai r or exhaust any right or power consequent thereon.

Upon the occurrence of an Event of Default, the Trustee may , and will at the direction of the Holders of not less than a maj ority in aggregate pri ncipal amountof the Bonds then Outstanding, bywritten notice to the Corporation declare the pri ncipal of the Bands to be immediately due and payable, whereuponthat portionof the principal of the Bands thereby comingdue and the interest thereonac crued to the dateof pay mentwi 11, without further action, become and be immediately due and payable, anything in the Indenture or in the Bonds to the contrary notwithstanding.

Upon the occurrence of an Event of Default, the Trustee may , and will, at the direction of the Holders of not less than a maj ority in aggregate principal amount with respect to the Bonds then Outstanding, by written notice to the Corporation, declare the principal of the Bondsto be immediately due and payable, whereupon that portion ofthe pri ncipal of the Bands therebycoming due andthe interest thereon accrued to the date of pay ment will, withoutfurther action, becomeand be immediately due and payable, anything in the Indenture or in the Bonds to the contrary notwithstanding.

Remedies onDefau lt. If an Event of Default occurs, then, and in eac h and every suchcase during the conti nuance of such an Event of Default, the Trustee may take one or more of the fol lowing remedial steps subjectto any mandatory requirements ofany appl icable law then in effect:

(a) The Trustee may , if the Bonds have been declared to be due and payable immediately pursuant to the Indenture and upon notice in writing to theCorpora tion, declare al l Bond pay ments payable for the remainder of the term of the Indenture to be immediately dueand payable, whereuponthe same will be immediately due and payable, anything in the I ndenture to the contrary notwithstanding; "Band payments" as used in this subsection means an amount equal to the entire principal amount represented by the Bonds then Outstanding, together with any applicable redemption prerri umsand all interest accrued or to accrue on and prior to the next succeeding redemption date or dates on which the Bonds can be redeemed after giving notice to the Holders thereof as required by the Indenture (less moneys avai lable for such purpose then held by the Trustee) plus any other pay mentsdue or to become due under theIn denture, including, without limitation, any unpaid fees and expensesof the Trustee which are then due or will becomedue prior to the timethat the Bonds are paid in full and the trust establ ished bythe I ndenture is terrrina ted.

(b) The Trustee may takewha tever action, at law or in equity, as may appear necessary or desi rable to col lect the Bond payments and any other pay ments then due and thereafter to become due underthe Indenture or to enforce the performance and observance of any obligation, covenant, agreement or provision contained in the Indenture to beobserved or performed bythe Corporation.

(c) The Trustee will have all the rights and remedies of a secured party orcreditor under the Uniform Commercial Codeof the State of California, andthe general laws of the State of California, with respectto the enforcementof the security interests granted or reserved under the Indenture, including without Ii mitationto the extent perrritted byla w the right to require thatall of the Event Center Proj ect Revenues beasse mbled and del ivered to the Trustee and the Trustee may, to the extent perrritted by law, impound books and records evidencing the Corporation'sac counts, accounts receivable and other si milar claims for the pay ment of money and take possession of al l notesand ot her documentswhich evidence such accounts, accounts receivable and clai msfor money and give notice to obl igors thereunderof its interest in Event Center Proj ect Revenues and make direct col lections on such accounts, accounts receivable and claims for money.

Appl ication of Revenues and Other Funds After Default. If an Event of Default occurs and is continuing, al l Revenues and any other funds then held or thereafter received by the Trustee under any of the provisionsof the Indenture will beappl ied bythe Trustee as fol lows and in the following order:

(a) To the payment of any expenses necessary in the opinion of the Trustee to protect the interests of the Holders of the Bonds and payment of reasonable fees and expenses of the Trustee (including reasonable fees and disbursements of its counsel) incurred in and about the performance of its powers and duties

B-20 under the Indenture, together with interest on any such amounts which may be advanced by the Trustee at the maximum rate permitted by law;

(b) To the pay mentof the principal or redemption price and interest then due with respectto the Senior Bonds (upon presentation of the Senior Bondsto be paid, and stampingthereon of the pay ment if only partially paid,or surrender thereof if fully paid) subject to the provisions of the Indenture, as fol lows:

(i) Unless the pri ncipal amountof such Senior Bond will have becomeor have been declared due and payable,

First: To the pay ment to the Persons entitled thereto of al l interest then due, and, if the amount avai lable will not be sufficient to pay in ful l all interest then due, ratably, according to the armunts due thereon, tothe Persons entitled thereto, without any discrimi nation or preference; and

Second: To the pay ment to the Persons entitled thereto of the unpaid pri ncipal or redemption price with respect to any Senior Bond which will have become due, in the order of their due dates, with interest on the overdue pri ncipal at the rate borne by the respective Senior Bonds, and, if the amountav ai lable will not be sufficient to pay in ful l all the Senior Bonds due on any date, togetherwith such interest, thento the pay mentthereof rat ably, according to the armuntsof pri ncipal or redemption price due on suchdate to the Persons entitled thereto, without any discrimi nation or preference;and

(ii) If the pri ncipal will have becomeor have beendecl ared due and payable, to the pay mentof the pri ncipal and interest then due and unpaidwith respectto theSenior Bonds, with interest on the overdue pri ncipal atthe rate borne bythe respective Senior Bands, and, if the amountav ai lable will not be sufficient to pay in full the whole amount so due and unpaid, then to the pay ment thereof ratably, without preference or priority of principal overin terest, or of interest overpri ncipal,or of any Senior Bond overany other Senior Bond, according to the amounts due respectively for pri ncipal and interest, to the Persons entitled thereto without any discrimination or preference.

(c) To the pay mentof thepri ncipal or redemption price and interest then due with respectto the Subordinate Bonds (upon presentation of the Subordinate Bonds to be paid, and stampi ng thereon of the pay ment if only partially paid, or surrender thereof if fully paid) subject to the provisions of the Indenture, as fol lows:

(iii) Unless the pri ncipal armunt of such Subordi nate Bond will have become or have been declared dueand payable,

First: To the pay ment to the Persons entitled thereto of al l interest then due, and, if the amount avai lable will not be sufficient to pay in ful l all interest then due, ratably, according to the armunts due thereon, tothe Persons entitled thereto, without any discrimi nation or preference; and

Second: To the pay ment to the Persons entitled thereto of the unpaid pri ncipal or redemption price with respectto any Subordinate Bond which will have becomedue, in the order of their due dates, with interest on the overdue pri ncipal at the rate borne bythe respective Subordinate Bands, and, if the amount avai lable will not be sufficient to pay in full all the Subordinate Bonds due on any date, together with such interest, then to the pay ment thereof ratably, according to the armunts of principal or redemption price due on such date to thePer sons entitled thereto, without any discrimi nation orpref erence; and

(iv) If the pri ncipal will have become or have beendecl ared due and payable, to the pay ment of the principal and interest then due and unpaid with respect to the Subordi nate Bonds, with interest on theoverdue principal atthe rate borne bythe respective Subordinate Bonds, and, if the amount avai lable will not be sufficient to pay in full the whole armunt so due and unpaid, then to the pay ment thereof ratably, without preference or priority of principal over interest, or of interest over pri ncipal, or of

B-21 any Subordi nate Band overany other Subordinate Band, according to the armunts due respectively for pri nci pal and interest, to the Persons entitled thereto withoutany di scri mi nat ion or preference.

Trustee to Represent Bondholders. The Trustee is irrevocably appoi nted (and the successive respective Holders of the Bonds bytaki ng and holding the same, will be conclusively deemed to have so appoi nted the Trustee) as trustee and true and lawful attorney-in-fact of the Holders of the Bonds for the purposeof exercising and prosecuti ng on thei r behalfsuch rights and remedies as may beav ailable to such Holders under the provisions of the Bonds, the Indenture and appl icable provisions of law. Upon the occurrence and conti nuance of an Event of Default or other occasion giving rise to a right in the Trustee to represent the Bondholders, the Trustee in its discretion may , and upon thewrit ten request of the Holders of not less than 25% in aggregate principal armunt of the Bondsthen Outstanding, and uponbei ng indemnified to its satisfaction therefor, wi ll, in each case (except in the case of an Event of Default ari si ng under the Indenture) proceed to protect or enforce its rights or the rights of such Holders by such appropriate action, suit, mandamus or other proceedings as it wi ll deem rmst effectual to protect and enforce any such right, at law or in equity, either for the specific performance of any covenant or ag reement contained in the Indenture, or in aid of the exec ution of any power granted in the Indenture, or for the enforcement of any other appropriate legal or equitable right or remedy vested in the Trustee or in such Holders under the Indenture or any law with respectto suchBo nd; and upon instituting such proceeding, the Trustee will beentitled, as a matt er of right, to the appoi ntment of a receiver of the Revenues and other assets pledged under the Indenture pending such proceedings. All rights of action under the Indenture or the Bonds or otherwi se may be prosecuted and enforced bythe Trustee without the possession of any of the Bonds or the production thereof in any proceeding relati ng thereto, and any such suit, action or proceedingin stituted by the Trustee wi ll be brought in the name of the Trusteefor the benefitand protection of al l the Holders of such Bands, subject to the provisions of the Indenture.

The Trustee

Duties. Immunities and Liabi lities of Trustee. The Trustee wi ll, prior to an Event of Default, and after the curing of al l Events of Default which may have occurred, perform such duties and only such duties as are specifical ly set forth in the Indenture. The Trustee wi ll after an Event of Default and prior to the curing of such Event of Default use the same degree of care and skill in their exercise, as a prudent personwould exercise or use underthe circumstances in theconduct of thei r own affai rs.

No provision of the Indenture wi ll be construed to relieve the Trustee from liabi lity for its own negl igent action or its ownne gl igent fai I ure to act, except that -

(a) prior to such an Event of Default under the Indenture and after the curing of al l Events of Default which may haveoccu rred -

(1) the duties and obl igations of the Trustee wi ll be deterrri ned solely by the express provisions of the Indenture, the Trustee will not be liable except for the performance of such duties and obl igations as are specifical ly set forth in theIn denture, and no impl ied covenantsor obl igationswi ll be read into the I ndentureagai nst the Trustee; and

(2) in the absence of bad fai th on the part of the Trustee, the Trustee may conclusively rely, as to the truth of the statements and correctness of the opi nions expressed therei n, upon any certificateor opi nion furnished to the Trustee conforming to the requirementsof the I ndenture; but in thecase of any such certificate or opinion which by any provision of the Indenture is specifical ly requi red to be furnished to the Trustee, theTrustee wi ll be undera duty to exami ne the sameto determi newhether or not it facially conformsto the requi rementsof the I ndenture; and

(3) the Trustee will hav e no duties or obligations with respect to the Management Agreement;and

B-22 (b) atal I ti mes, regardless of whether or not any Event of Default wi 11 exi st -

( 1) the Trustee will not be liable for any error of judgment made in good faith by a responsi ble officer or officers of the Trustee unless it shal l be proved that the Trustee was negligent in ascertai ni ng the pertinent facts; and

(2) the Trustee wi ll not be liable with respect to any action taken or omitted to be taken by it in good faith in accordance with the direction of the Holders of not less than a maj ority (or other percentage provided for in the Indenture) in aggregate pri nci pal amountof the Bonds atthe ti meoutstand ing re lati ng to the ti me, method and place of conducting any proceeding for any remedy avai lable to the Trustee, or exercising any trust or power conferred uponthe Trustee under the I ndenture.

Qual ificationsof Trustee. There will at al l ti mes be atrus tee under the Indenture which wi ll be a corporation, federal savings association, federal ly chartered sav ings institution, sav ings bank, national banking association, sav ings institution, or fi nancial institution, the deposits of which are insured bythe FDIC to the extent perrritted by law, organized and doi ng busi ness under the laws of the United States of America or the State of Cal ifornia, authorized under such laws to exercise corporate trust powers, having a place of busi ness in the county in which the Principal Office of the Trustee is located, having a combi ned capital , exclusive of borrowed capital, and a surplus of at least $50,000,000, and subject to supervision or exami nation by federal or state authority. If such corporation publ ishes reports of condition at least annual ly, pursuant to law or to the requi rements of any supervisi ng or exami ni ng authority above referred to, then for the purposes of this paragraph the combi ned capital and surpl us of such corporationwi ll be deemed to be its combi ned capital and surpl us as set forth in its most recent report of condition so publ ished. In case at any time the Trustee wi ll cease to be eligible in accordance with the provisions of this paragraph, the Trustee wi ll resign immediately in the manner and with the effect specified in the Indenture.

Resignation and Removal of Trustee and Appointmentof Successor Trustee. The Trustee may at any time resign by giving written notice to the Corporation and by giving to the Bondholders notice of such resignation by mai l. Upon receiving such notice of resignation, the Corporation wi ll promptly appoi nt a successor trustee by an instrument in writing executed by order of the governi ng board of the Corporation. If no successor trustee will have been so appointed and have accepted appoi ntment within thirty days after the publication of such notice of resignation, the resigning trustee may petition any court of competentju risdiction for theappoi ntment of a successor trustee, or any Bondholder who has been a bona fide Holder of a Bond for at least six months may , on behalf of himself and others similarly situated, petition any such court for the appointment of a successor trustee. Such court may thereupon, after such notice, if any, as it may deem proper and prescribe, appoi nt a successor trustee.

(a) In case at any ti meany of the fol lowi ng wi 11 occur -

(1) the Trustee ceases to be el igible in accordance with the provisions of the Indenture and fails to resign after Written Request therefor bythe Corporation or byany Bondholder who has beena bonafide Holder of a Band for at least 6 months, or

(2) the Trustee becomes incapable of acti ng, or is adj udged a bankrupt or insolvent, or a receiver of the Trusteeor of its propertyis appoi nted, or any public officer takes charge or control of the Trustee or of its property or affairs for the purposeof rehabil itation, conservationor liquidation,

then, in any suchcase, the Corporation, so longas an Event of Default wi ll not have occurred and be conti nuing, may rermve theTrus tee and appoint a successor trustee by an instrument in writing executed byorder of its Board of Directors, or any such Bondholder may , on behalf of himself and al l others si mi larly situated, petition any court of competent jurisdiction for the rermval of the Trustee and appoi ntment of a successor trustee. Such court may thereupon, after such notice, if any, as it may deem proper and prescri be, remove the Trustee and appoi nt a successor trustee.

B-23 Modification of Indenture

Modification without Consent of Bondholders. The Corporation, when authorized by resolution of its Board of Directors, and the Trustee, from ti me to time and at any ti me, subject to the conditions and restrictions in the Indenture contai ned, may enter into an indenture or indentures supplemental to the Indenture, which indenture or indentures thereafter will form a part of the Indenture, for any one or more or al l of thefol lowi ng purposes -

(a) to add to the covenants and ag reements of the Corporation in the Indenture contai ned, other covenants and agreements thereafter to be observed, or to surrender any right or power in the Indenture reserved to or conferred upon the Corporation, provided, that no such covenant, agreement or surrender wi ll havea Material Adverse Effect on the interests of the Holders of the Bonds;

(b) to evidence the succession of another corporation to the Corporation, or successive successions, and the assumption by asuccessor corporation of the covenants and obl igations of the Corporation in the Bands and in the I ndenture;

(c) to make such provisions for the purpose of curingany ambiguity, or of curing, correcti ng or supplementing any defective provision contai ned in the Indenture, or in regard to other matters or questions arising under the Indenture, as the Corporation may deem necessary or desi rable and not inconsistent with the Indenture and which will not have a Material Adverse Effect on thein terests of the Holders of the Bonds;

(d) to modify, amend or supplement the Indenture or any indenture supplemental thereto in such manneras to permitthe qualification of the Indenture and thereof under the Trust Indenture Act of 1939 or any si mi I ar federal statute hereafter in effect, and, if they so deterrrine, to add to the I ndenture or any indenture supplemental thereto such other terms, conditions and provisions as may be permitted by said Trust Indenture Act of 1939 or similar federal statute, and which wi ll not have a Material Adverse Effect on the interests of the Holders of the Bonds;

(e) to authorize the issuance of an additional series of Bonds pursuant to and in compliance with the provisions of the I ndenture;

(f) to provide for a letter of credit, insurance policy or other si milar fi nancial instrument in lieu of or in replacement of moneys required to bedeposited in the ReserveAccoun t, which provision wi ll not have a Material Adverse Effect on the interests of the Holders of the Bonds.

Modification with Consent of Bondholders. With the consent of the Holders of not less than 51% in aggregate principal amountof the Bonds atthe ti meoutstand ing, the Corporation, when authorized by aCertified Resolution of its Board of Di rectors, and the Trustee may from ti meto ti meand at any ti me enter into an indenture or indentures supplemental to the Indenture for the purpose of adding any provisionsto or changi ng in any manner or el iminating any of the provisions of the Indenture or of any supplemental indenture; provided, however, that no such supplemental indenture wi ll ( 1) extendthe fixed maturitiesof the Bonds or reduce the rate of interest thereon or extend the ti meof pay mentof interest, or reduce the amountof the principal thereof, or reduce any premi um payable on the redemption thereof, without the consent of the Holder of each Band so affected, or (2) reduce the aforesaid percentage of Holders of Bands whose consent is required for the execution of any such supplemental indenture, or perrrit the creation of any lien on the Trust Estate prior to or on a parity with the lien of the Indenture (except as expressly perrritted by the Indenture) or deprive the Holders of the Bands of the I ien created by the Indenture upon the Trust Estate, without the consent of the Holders of all of the Bonds then outstandi ng, or (3) hav e a Material Adverse Effect on the rights of the Holders of Subordinate Bonds without the consent of all the Holders of Subordi nate Bonds then Outstanding. It will not be necessary for the consent of the Bondholders to approve the particular form of any proposed supplemental indenture, but it will be sufficient if such consent will approve the substance thereof.

B-24 Defeasance

Discharge of Indenture. If the Corporation shal l pay and discharge the enti re indebtedness on al l Bands outstandi ng in any one or more ofthe fol lowi ng ways -

(a) by wel l and truly paying or causi ng to be paid the pri nci pal of (including redemption prerrium, if any) and interest on al I Bands outstanding, as and when the same become duepay and able;

(b) by depositi ng with the Trustee, in trust, at or before maturity, money in the necessary amount to pay or redeem al I Bands outstanding;

(c) bydel ivering to the Trustee, for cancel lation by it, all Bands outstanding; and

(d) by depositi ng with the Trustee, in trust, Investment Securities of the type descri bed in clause ( 1) of the defi nition thereof in such amountas the Corporation (as verified by an independentCertified Publ ic Accountant) shal I determi newi 11, together with the incomeor incrementto accrue thereon, beful ly sufficient to pay and dischargethe indebtedness on al l Bonds at or before their respective maturity dates;

and if the Corporation shall al so pay or cause to be paid al l other sums payable under the Indenture by the Corporation, then and in that case the I ndenture wi II cease, determine, and become null and void ( except for the obi igation of the Corporation to pay al l amounts due and payable on the Bands from such deposits, to compensate and indemnify the Trustee as provided in the Indenture, and to satisfy the requirements of the Indenture unti I al I Bonds are paid in full).

The Corporation may at any ti me surrender to the Trustee for cancellation by it any Bonds previously authenticated and delivered which the Corporation may have acquired in any manner whatsoever, and such Bonds, upon suchsurrender and cancel lation, will bedeemed to be paid and reti red.

Discharge of Liabi lity on Bonds. Upon the depositwith the Trustee, in trust, at or beforemat urity, of moneyor Federal Securities in the necessary amount to pay or redeem outstanding Bonds (whether uponor prior to thei r mat urity or the redemption date of such Bands), provided that if such Bands are to be redeemed prior to the maturity thereof, notice of such redemption wi ll have been given as provided in the Indenture or provision satisfactory to the Trustee wi ll have been made for the giving of such notice, all liabi lity of the Corporation in respect of such Bonds wi ll cease, determine and becompletely discharged and the Holders thereofwi ll thereafter be entitled only to payment out of the money or Federal Securities deposited with the Trustee as aforesaid for thei r pay ment, subject, however, to thepr ovisions of theIn denture.

Pavmentof Bondsaf ter Discharge of Indenture. Notwithstandingany provisions of theIn denture, any moneys deposited with the Trustee in trust for the pay ment of the principal of, or interest or prerri um on, any Bonds and remai ning unclaimed for two years after the principal of or interest on al l the outstanding Bonds has become due and payable (whether at maturity or upon cal I for redemption or by declaration as provided in the Indenture) will then be repaid to the Corporation, and the Holders of such Bonds wi ll thereafter be entitled to look only to the Corporation for pay ment thereof, and al l liabil ity of the Trustee with respect to such moneys wi ll thereuponcease.

THE GROUND LEASE

Lease of Site. Pursuant to the Ground Lease, the Board wi ll lease the Site to the Corporation. The Board will deliver possession of the Site to the Corporation uponcommencement of the term of the Ground Lease and further covenantsthat, subject to the limitations expressly set forth therei n, the Corporation, uponperformi ng al l covenants in the Ground Lease, may quietly have, hold, and enjoy al l of the Site during the term of the Ground Lease and any extended term thereof, without hindrance or interruption bythe Board.

B-25 The Site shal l be used by the Corporation during the term of the Ground Lease solely for the purpose of constructi ng and operating the Proj ect and appurtenances thereto and for such purposes as may be incidental thereto.

Term. The term of the Ground Lease wi ll commence on the earl ier of the date of recordation of the lease in the office of the County Recorder of Fresno County, State of California, or December 14, 2001 , and shal l end on December 13, 2033, unless such term is extended or sooner terrri nated as provided in the Ground Lease. If on December 13, 2033, any Bonds or other indebtedness of the Corporation incurred to pay for the acquisition, design and construction of the Proj ect shal l not beful ly paidor no longer outstanding under the termsof such Indenture or the Indenture authorizing such Bonds shal l not be discharged by its terms, then the term of the Ground Lease shal l beextended until 10 days after al l Bonds and other indebtedness of the Corporation incurred to pay for the Project shal l be fully paid or no longer outstanding and any such Indenture shal l be discharged by its terms, except that the term of the Ground Lease shal l in no event be extended beyond December 13, 2043. If prior to December 13, 2033, all Bonds and other indebtedness of the Corporation incurred to pay for the Proj ect shal l be fully paid or no longer outstandi ng under the terms ofthe Indenture and any such Indenture shal l be di scharged by its terms, the term of the Ground Lease shal l end 10 days thereafter or 10 days after written notice by the Corporation to the Board, whichever is earl ier.

The Projectshal l becomethe propertyof the Board without additional cost and without demandor furtherac tion bythe Board atthe termi nation of the Ground Lease and any extension thereof.

Should the Corporationdefau lt in its payments under the Bands, the Board shal I have an exclusive option to purchase the Proj ect and additions to the Proj ect for the principal arrnunt of the outstanding Bonds and accrued interest to the date of default. The Board shall have not less than 90 days from the date it exercises the option to purchase the Proj ect and suchadd itions.

Charges for Services Provided bv the Board. The Corporation shal l rei mburse the Board for reasonable expenditures incurred by the Board as result of activities of the Corporation under the terms of the Ground Lease. This rei mbursementshal l include, but not be limited to, utility costs, custodial services, mai ntenance costs, and supplies.

Resoonsibi litv for Construction of the Project. The Corporation shall arrange for the design and construction of the Proj ect, including al l attendant facilities, in substantial accordance with the contract documentation approved (or to be approved) by the Corporation and consistent with the quire rements of the Board and University. TheCorpora tion shal l obtain at its expense al l licenses and perrrits requi red to perform the work and shal l comply with al l appl icable laws affecting the work.

Insurance and Indemnification. The Corporation shal l mai ntai n or cause to be mai ntained, at al l ti mes during the term of the Ground Lease and al l extensions thereof, fire, lightni ng, and extended coverage insurance, including vandal ism and mal icious mischief insurance and spri nkler system leakage insurance, and, fol lowing completionof construction of the Proj ect, earthquake insurance (but only if such insurance is available at reasonable cost on the open market from reputable insurance companies), either as a part of comprehensive insurance carried by the Corporation or as a part of insurance carried by acontractor under a construction contract, on al I structures constituti ng any part of the Site and i rnprovements constructed thereon, in an arrnunt equal to 1 QOl,.,6 of the replacementcost of such structures or, in the alternative, in an arrnuntand in a form sufficient (together with other rrnneysav ai lable for that purpose) , in the event of total or partial loss, to enable the Corporation either to reti re al l Bonds then outstanding or to restore such structures to the condition existing before such loss. Said extended coverage endorsement shal l, as nearly as practicable, cover loss or damage by explosion, wi ndstorm, riot, ai rcraft, vehicle damage, srrnke and such other hazards as are normal ly covered by suchendorse ment.

The Corporation shal l maintai n in force during the term of the Ground Lease and all extensions thereof publ ic liability and property damage insurance in the sum of $2,000,000for injury to or death of any one person for each occurrence, in the sum of $6,000,000 for injury to or death of rrnre than one person for each occurrence, and in the sum of $1,000,000 for damages to property for each occurrence, except that such publ ic liabi lity and property damage insurance may be subjectto a deductible clause not to exceed $100,000. Such publ ic

B-26 liabi lity insurance and such property damage insurance may , however, be in the form of a si ngle limit policy in the amountof $6,000,000covering all such risks.

The proceeds of said property damage insurance received in connection with damage to or destruction of the Site or structures or improvements thereon, wi ll, subject to availabi lity after appl ication in accordance with theterms and conditions of the Indenture, (a) be used to reconstruct any structures or improvements located on the Site, regardless of whether the insurance proceeds are sufficient to pay for the reconstruction, or (b) be rerrittedto the Board.

Termination. The Ground Lease shall terminate upon the occurrence of any of the followi ng occurrences:

(A) Expi ration of the lease term; (B) Fail ure to perform any substantial provision of the Ground Lease; (C) Cessation of operations of the Corporation; or (D) The assignment or subleasing of any partof the premises without the written permission of the Board;

provided, however, that with respect to any of the foregoing events described in clauses (B) through (D), inclusive, the Trustee shall have the right, but shal l not beobl igated to, cure any default by the Corporation underthe Ground Lease, as provided in the Indenture. Upon the occurrence of an event described in clauses (B) through (D), inclusive, and prior to terrri nati ng the Ground Lease, the Board shal l take al l reasonable action to approve a successor corporation or entity to the Corporation and assign and transfer the net assets of the Corporation (includi ng, without limitation, the Ground Lease) to such successor corporation or entity. The Board and the Corporation shall provide notice to the Trustee in theevent of any failure to perform any provision of the Ground Lease.

Encumbrance Of Lease Hold. With the exception of the Ground Lease and the Indenture, the Corporation shal l not encumberthe Board's fee title except by such legislative means that may be avai lable. Other than the Indenture, the Corporation shal l not have the right to subject the Ground Lease to any mortgage nor subject the Ground Lease to any trust deed or other security device, withoutthe prior written consent of the Board, which consent shal l notbe unreasonably withheld.

Amendments. The Ground Lease may not be amended, changed, modified or al tered without the prior written consent of the Board and the Corporation.

Non-l iabilityof The Board. Any obl igationof the Board created by or arising out of the Ground Lease shal l not impose a debt or pecuniary liabi l ity uponthe Board or the State of Cal ifornia or a charge upon the general credit or taxing powers thereof but shal l be payable solely out of funds duly authorized and appropriated by the Stateof California.

The del ivery of the Ground Lease shal l not, di rectly or indirectly or conti ngently, obl igate the Board or the State of California to levy any form of taxationther efor or to make any appropriation. Nothing in the Ground Lease or in the proceedings of the Board shal I be construed to authori ze the Board to create a debt of the Board or the State of Cal ifornia, within the meaning of any constitutional or statutory provision of the State of Cal ifornia. No breach of any pledge, obl igation or agreement made or incurred in connection with the Ground Lease may impose any pecuniary liabi lity upon, or any charge upon the general credit of the Board or the State of Cal ifornia.

Eminent Domain. I n the event the whole or any partof the premises or improvementsthereon is taken permanently or temporari ly under the power of eminent domain, the interest of the Corporation shall be recognized and is determined to be the amount of the then unpaid indebtedness incurred by the Corporation to fi nance or refi nance theconstruc tion of the Project, including the unpaid pri ncipal thereof and interest thereon, and shal l be paid to the Trustee under the Indenture authorizing such Bonds or other indebtedness and applied as provided in saidIn denture.

B-27 APPENDIX C SUMMARY OF CONSTRUCTION CONTRACT Set forth belCMt is a sumrary of certain provisions of the Construction Contract and the General Conditions relating thereto. This sumrary is qualified in its entirely by reference to the Construction Contract and the General Conditions relating thereto, copies of which rmybe obtained fromthe Corporation. All capitalizedterrr6 used in this sumraryand not otherwise defined herein will have the rreanings assigned thereto in the Construction Contract and the General Conditions relating thereto. CONSTRUCTION CONTRACT PROVISIONS The Work of the Construction Contract

The Construction Contractor will providePreconstruction and Construction periodservices to assist the Corporation in developing a program for a functional facility able to be legally occupied and used for its intended purposesupon completion of the Work as welI as otherwise set forth in this Paragraph. To that end, the Construction Contractor will execute the entire Work, subject to the alternates accepted by the Corporation, which are listed in Exhibit A attached to the Construction Contract. Preconstruction Services. As a courtesy, Construction Contractor has provided preconstruction services such as perforni ng constructabiI i ty reviews, generating budgets, and performing value engineering services. Value Engi neeri ng Services. The Construction Contractor wi11 actively participate in a value engineering review prior to commencement of construction. During the course of preparation of the Contract Documents and execution of the Work, the Construction Contractor wi 11 continue to review and develop value-engineering proposals for review by the Corporation. For "value engineering" purposes, Construction Contractor will review the drawings, specifications, bid form and other documents developed by the Architect and proposed as construction documents as set forth in the Construction Contract, and Corporationwi 11, after conferring with Construction Contractor, direct the Architect to makenecessary revisions. Construction Management(CM) Services. The Construction Contractor will coordinate and manage the building process as a member of a team with the Corporation, Corporation's Representative, Architect, Construction Monitor and other project consultants. The Construction Contractor wi 11 develop and deliver schedules, prepare construction estimates, perform value engineering, review alternative designs, study labor conditions, and coordinate and communicatethe activities of the team throughout the construction phases to all membersof the construction team. Construction Services. The Construction Contractor wi11 provide and pay for alI materials, tools, equipment, labor and specific professional and non-professional services, and all sales taxes and assessments thereon as providedin the Construction Contract, and wi11 performal I other acts and supply all other things necessary to fully and properly perform and complete the Work to the full satisfaction of the Corporation, as required bythe Contract Documentsand the alternates accepted by the Corporation. Those portions of the Work that the Construction Contractor doesnot customarily

C-1 perform with the Construction Contractor' s CMtn personnel wi11 be perforrrEd under subcontracts or byother appropriate agreerrEntswith the Construction Contractor. Construction Contractor Resoonsibilitv to Review Drawings and Specifications. The Corporation has a separate agreerrEnt with the Architect to design the Project and to provide construction adni ni strati on services necessary to ensure that the construction conforms to the Contract DocurrEnts. B oth the Construction Contractor and the Architect wi 11 be given direction by the Corporation through the Corporation's Representative. The Corporation intends to create a cooperative team among the Construction Contractor, Architect, Corporation's Representative and the Construction Monitor. The recomrrEndations and advice of the Construction Contractor concerning design alternatives will be subject to the review and approval of the Corporation and the Corporation's professional consultants. The Construction Contractor has, on an ongoing basis, an obi i gation to review the Contract DocurrEntsthat are in existence at the tirrE of contracting and that are produced and del ivered in an effort to complete final construction docurrEnts. Corporation acknCMtledges and agrees that Construction Contractor is not a designer and that Construction Contractor will have no liability for errors or omissions in the Contract DocurrEnts. HONever, Construction Contractor will have an ongoing duty to diligently review the Contract DocurrEnts in an effort to identify and circumvent issues which could negatively impact the cost or schedule of the Project and to report to the Corporation and Architect those of which it has actual knCMtledge. If the Construction Contractor has actual knONledge that portions of the Contract DocurrEnts are at variance with any applicable law, statute, ordinance, building code, rule or regulation, the Construction Contractor will promptly notify the Architect and Corporation in writing of such variances, and will not comrrEnce any corrective work without Corporation's written approval. If the Construction Contractor fails to ti rrElynotify theCorporation and Architect of such a Iack of compliance it wi11 rerrEdysuch Iack of compliance at its ONn expense without increase in the GMP or extension of the Contract TirrE. Architectural di rrEnsions wi 11 be checked by Construction Contractor for consistency and accuracy prior to the ordering of any material and prior to the instal I ati on thereof. Nothing i n the Construction Contract will relieve Construction Contractor of its obligations under the applicable law to perform the Work in conformance with the applicable legal (including building codes) requirerrEnts. The Construction Contractor wi11 be responsiblefor coordinati ng the trade contractors in performance of the Work. Construction Contractor expressly warrants and represents that as of the date of the Construction Contract, Construction Contractor is not aware of any reason why the Project as designed cannot becompleted fully and ti rrEly for the GMP. Addition and Deletion of Work. The parties anticipate that construction of the Work may comrrEnce on a phased basis with certain bid packages being Iet prior to completion of alI Contract DocurrEntsnecessary for construction of the entire Project. The partiesto the Construction Contract acknONledge and agree that Corporation may, at any tirrEduring the term of the Contract, add to or delete from the Project certain portions of the Project, and, in such event, will notify Construction Contractor in writing of such addition or deletion. HCMtever, as a condition precedent to any deletions from the Project, the parties acknCMtledge that Corporation must procure the prior written consent of its Construction Monitor, which consent may be withheld unless and until the Project's designated Construction Monitor certifies that (a) the reduction in the amount of the GMP provided byConstruction Contractor in consideration of such deletion is equal to or greater than the value of portion deleted, (b) that the deletion will not materially impact the quality of the Project (c) that the Construction Schedule will not be materially and adversely impacted by such deletion and (d) that the deletion will not materially impact the revenue generating ability of the Project. As a condition

C--2 precedent to anyadditions to the Project, the parties acknCMtledge that the Corporation must procure the prior written consent of its Construction Monitor, which consent may be withheld unless and until the Project's designated Construction monitor certifies that (a) Corporation has procured sufficient funds to pay for such additions, (b) such addition will not materially impactthe quality of the Project and (c) that the Construction Schedule will not be materially and adversely impacted by such addition. Subjectto the Construction Contract, Drawings and S pecifi cations completed after the date of the Construction Contract wi11 be incorporated into the Contract by a no cost/no time extension Change Order. Drawings and Specifications will be delivered to the Construction Contractor in final form in accordance with the schedule attachedto the Construction Contract. In the event of such addition or deletion by Corporation, Construction Contractor, after receiving approval from the Corporation's Representative, will immediately commence and diligently prosecute the necessary steps to add or rern::we such portions of the Projectto or from the Project. Notwithstanding anything to the contrary set forth in the Contract Documents, Corporation expressly reserves the right, in Corporation's sole and absolute discretion, to elect to design-build any portion of the Project. If Corporation elects to design-build a portion of the Project, or a part thereof, the Work with respect to such portion of the Project, or the applicable part thereof, will be performed on a design-build basis by a contractor selected by Corporation pursuant to a written agreement between Corporation and such contractor and wi11 be removed frCMtn the scope of the Work to be performed by Construction Contractor pursuant to the Contract Documents and Corporation will adjust Construction Contractor's compensation under the Construction Contract with respectto such portionof the Project accordingly. Corporation may elect, in Corporation'ssole and absol ute discretion, to engage Construction Contractor to coordinate the onsi te work of Corporation's desi gn-buiId contractor and, i n such event, Corporation and Construction Contractor will mutually agree upon the fee to be paid to Construction Contractor for such coordination work. Construction Contractor will not be liable for any construction defects or errors in the work performed by Corporation's separate design-bui Id contractor except to the extent Construction Contractor, in its coordination effort, knew or should have knCMtn in the exercise of its Standard of Care of such errors or omissions and failed to notify the Corporation timely. Additionally, Construction Contractor will have no responsibility for the design by Corporation's design-build contractor. The parties agree that any delays caused by Corporation's design-build contractor retained directly by Corporation will be the responsibility of Corporation as it relates to the Construction Contractor. Completion of the Work

The Corporation will designate in the Notice to Proceed the follCMting: 1) the Commencement Date of the Work under the Contract (which will be no less than 7 days after the date of issuance of the full Notice to Proceed) and 2) the Substantial Completion Date for the Work is November15, 2003, as adjusted pursuant to the Contract Documents(the "Substantial Completion Date. The parties agree that as a condition precedent to the Corporation's exercise of the right to issue a Notice to Proceed, the bond proceeds which constitute the majority of the Corporation's financing for the Project, must exist in the custodyof a bondtrustee. U ponissuance of the bonds, the Corporation will issue a Notice to Proceed for the entire Project. If the Notice to proceed is not issued byJanuary 31, 2002, the Construction Contractor will be entitled to a day-for-day extension for each day of delay until the Notice to Proceed is issued. Further, if the Notice to Proceed is not issued by February 28, 2002, the Construction Contract will be null and void unless an extension is mutually agreed to bythe parties.

C-3 The Corporation will, at the written request of the Construction Contractor, prior to the commencement of the Work and as requested with reasonable frequency thereafter, furnish to the Construction Contractor evidence that financial arrangements have been made to fulfill the Corporation's obi i gati ons under the Contract Documents. The satisfaction of this requi rement bythe Corporation will be at the Construction Contractor's sole and absolute discretion notwithstanding anything in the Contract Documents. Furnishing of such evidence will be a condition precedent to commencement or conti nuation of the Work (including change order work). After such evidence has been furnished, the Corporation will not materiallyvary such arrangementswithout prior approvalof the Construction Contractor to begranted at Construction Contractor' s sole and absolute discretion. Notwithstanding anything in the Contract Documents, the parties expressly agree that if the Corporation does not provide evidence of fi nanci ng, reasonable in the Construction Contractor' s sole and absolute discretion, Construction Contractor may stop its performance partially or entirely in order to avoid exposureby incurring costs beyondthe Corporation'sevidence of financing, untiI such evidence of financing is provided. This provision will survive termination or expiration of the Contract Documents. Li qui dated Damages IN THE EVENT THE CONSTRUCTION CONTRACTOR FAILS TO ACHIEVE SUBSTANTIAL COMPLETION OF THE PROJECT WITHIN THE DATE INDICATED IN THE CONSTRUCTION CONTRACT (SUBJECT TO APPROVED EXTENSIONS, IF ANY), THE PARTIES AGREE THAT IT WOULD BE IMPRACTICAL OR EXTREMELY DIFFICULT TO ESTABLISH OWNER'S DAMAGE BY REASON OF SUCH FAILURE BY THE CONSTRUCTION CONTRACTOR TO TIMELY COMPLETE THE PROJECT. ACCORDINGLY, THE PARTIES AGREE THAT IT WOULD BE REASONABLE AT SUCH TIME FOR CONSTRUCTION CONTRACTOR TO PAY TO THE OWNER AS LIQUIDATED DAMAGES AND NOT A PENAL TY, THE FOLLOWI NG SU MS: If Substantial Completion of the Work is not achieved by the Substantial Completion Date as adjustedpurs uant to the terms of the Contract Documents, then LiquidatedDa mages will be assessed against Construction Contractor in the sum of $2,CXX) per day for each calendar day thereafter until Substantial Completion is reached. HONever, if the Construction Contractor does not achieve Substantial Completion by 730days after the Commencement Date set forth in the full Notice to Proceed), then Liquidated Damages will be assessed against Construction Contractor in the sum of $15,CXX)per day commencing on day 731and for each calendar day thereafter until Substantial Completion is reached. Notwithstanding provisions for Contract Time extensions in the General Conditions, the Corporation and Construction Contractor agree that timely completion of the Work is essential to the success of the Project, and that approval for time extension will be only a last resort. Both parties agree to make every reasonable effort to recover "lost" time, subject to the limitations of the funds avaiI able in the GMP. Should schedule recovery require costs that would exceed the GMP, the Construction Contractor will so advise the Corporation and the Construction Monitor in accordance with the Construction Contract for a deternination. Should the Corporation deternine to proceed with such schedule recovery and only to the extent the delays were not caused by the acts and/or omissions of the Construction Contractor, costs in excess of the GMP will be included in a Change Order. The Construction Contractor's contingencyis avaiI able for purposesof this paragraph only to the extent that delays are the fault of the Construction Contractor.

C-4 The Construction Contractor and Corporation waive claims against each other for consequential damages arising out of or rel ati ng to the Contract. This mutual waiver incl udes, but is not Ii mited to: (i) damages incurred by the Corporation for losses of use, income, profit, financing, business and reputation, and for loss of management or employee productivity or of the service of such persons; and (ii) damages incurred by the Construction Contractor for principal office expenses incl udi ng, but not Ii ni ted to the compensation of personnel stationed there, for Iasses of financing, business and reputation, and for loss of profit except anticipated profit arising directly from the Work. This mutual waiver is applicable, without limitation, to all consequential damages due to either party's termination. Nothing contained in this Paragraph will bedee!l"Ed to preclude an award of liquidated damages, when applicable, in accordance with the requirements of the Contract Documents. Guaranteed Maximum Price

The total sum of the Construction Contractor Fee, the General Conditions Costs, the Cost of the Work and alternates accepted by the Corporation (including such contingencies the Construction Contractor deems necessary to complete the Work based on the Contract Docu!l"Ents) and all other services ll"Entioned in applicable prcwisions of the Construction Contract will be guaranteed by the Construction Contractor. Such maximum sum is referred to in the Contract Documents as the Guaranteed Maximum Price (GMP). Costs that exceed the established GMP will be paid by the Construction Contractor without reimburse!l"Ent bythe Corporation. Changes to the GMP will only beauthorized byChange Order. The Construction Contractor Fee under the Construction Contract is three and one/quarter percent (3.25% ), expressed as a percentage of the Cost of the Work. This amount is payable with each application for paymentduring the construction phase, as a percentageof the work complete. General Conditions Costs -Notwithstanding any prcwisions to the contrary contained in the Construction Contract, the sum of all General Conditions Costs related to the Project and identified on Exhibit "A" attachedto the Construction Contract (hereafter, the "General Conditions Costs") will equalsix and one / quarter (6.25% ) of the Cost of the Work, as identified in Exhibit C attached to the Construction Contract. The General Conditions Costs are included in the GMP. The General Conditions Costs will not include temporary pcMter (to be borne by Corporation and not included in the GMP) , Construction Contractor's costs to purchase payment/performance bonds and subcontractor bonds (included in GMP) and the cost of buiIder' s risk i nsurance ( to be borne by the Corporation and not included in the GM P). Cost of the Work -The term "Cost of the Work'' will meancosts necessarily incurred bythe Construction Contractor in the proper performance of the Work, subject to the limitation of the amountof the GMP. The GMP is attached to the Construction Contract. The Construction Contractor will work with the Architect and Corporation to identify and confirm componentsand systems not specifically

C-5 shONn but required for a functional Project. As the Drawings and Specifications are not finished at the ti rrE of execution of the Construction Contract, the Construction Contractor wi 11 provide i n the GMP for the construction cost resulting from the further developrrEnt of the Drawings and Specifications by the Architect that is consistent with the Contract DocurrEnts and reasonably inferable therefrom. Construction Contractor has provided for the cost of such design developrrEnt as a part of a contingency in the GMP, as described belON. Such further developrrEnt does not include such things as changes (including those mandated by governrrEntal authorities) in scope, systems, kinds and quality of materials, finishes or equiprrEnt, all of which, if required will be incorporated by Change Order. The Corporation will direct the Architect to complete the final Construction DocurrEnts in accordance with the Project scope agreed upon by all parties at the tirrE the GM P was established and alternates accepted bythe Corporation. In developing the GMP, the Construction Contractor has included and identified certai n contingencies within the GMP as may be necessary to pay for minor, incidental elerrEnts that are required for a functional Project, as listed in the GMP, plus other expenses required for the Construction Contractor for the execution of the Work. This contingency wi 11 beavai I able for use by the Construction Contractor at its sole discretion. Construction Contractor will submit to the Corporation as requested by the Corporation reports as to the use of Construction Contractor Contingency. In addition, the Corporationwill maintainan Corporation'scontingency outside of the GMP to pay for additional scope. Any amounts remainingin Construction Contractor's Contingency at the completion of the Project wi 11 becredited to the Corporation. Construction Contractor Bonus. Construction Contractor may earn up to a $9CX),CXX) bonus as specified in this paragraph. Construction Contractor has prepared a Schedule of Values included in Exhibit A to the Construction Contract. On this schedule, each scopeof work is represented by a cost value. To the extent Construction Contractor can achieve cost savings by entering into subcontracts with its subcontractorsfor amounts which are less than the values as represented in the Schedule of Values, the sum of these cost savings to the Corporation (" Purchasing Savings") up to $9CX),CXX) will becorrE a bonus earned by the Construction Contractor and payable in no less than one--third payrrEnts, if alI of the folI ONi ng occur: 1) Construction Contractor must rrEet the folI ONi ng miI estones on the schedule, which is attachedas Exhibit D. These are: a Campi eti on of the structural concrete; b. Completion of the Precastseating, and c. Achieve Early Substantial Completion byNovember 15, 2003. PayrrEnts will be made (1/3 each) at the successful completion of each the above mi Iestones. Fai I ure of the Construction Contractor to meet miI estones (a) and ( b) abovewi 11 defer its col Iecti on of the associatedbonus payrrEnt associated with those niI estone dates. If Construction Contractor rrEets the next milestone, it will have earned any bonus payrrEnts previously deferred. Failure of the Construction Contractor to rrEet nilestone (c) above will result in a forfeiture of the bonus payrrEnt associated with that niI estone date. 2) Not used. 3) The Work is substantially on schedule; 4) The quality of the Work is acceptable; and

C-6 5) There are no Ii ens or stop notices pending (except those an s1 ng out of the Corporation'sfai I ure to makepayments as required under the Contract Documents). Any Purchasing Savings in excess of $9CX),CXX)will be reflected in a separate line item labeled"Corporation Construction Contingency". The first $200 ,CXX)of Corporation's Construction Contingency will be reseived by the Corporation until Final Payment to assist in expeditingthe processingof changes in the Work. Use of Construction Contractor Contingency. Construction Contractor has a contingency fund of five percent of the GMP, which is for Construction Contractor's use in completing the project. In the event there remains some portion of this fund unexpended at the conclusion of the Project, then this portionreverts to the Corporation. The Guaranteed Maximum Price will include only those taxes which are scheduled or enacted at the time the Guaranteed Maximum Price was established. For increase or decreases in taxes enacted thereafter, there will be a corresponding change order issued in accordance with the General Conditions. The Construction Contractor will, subject to the terms of the Construction Contract substantially complete the Project on or before the Substantial Completion Date at or belCMt the Guaranteed Maximum Price, subject to the termsand conditions of the Contract Documents. Changes in the Work

Adjustments to the GMP on account of changes in the Work beyond the stated scopewi 11 be determined pursuant to the General Conditions, with exception that the overhead and profit markup for the Construction Contractor will belimited as follONs: (i) total combined General Conditions Costs and Contractor's Fee of nine and one;half percent (9. 5% ) of the cost of that portion of the extra work to be performed by the Construction Contractor with its ONn forces. (ii) total combined General Conditions Costs and Subcontractor's Fee of Fifteen percent ( 15% ) of the cost of that portion of the Work to be performed by a Trade Contractor with its CMtn forces, plus total combined General Conditions Costs and Contractor's Fee of Three and one/quarter percent(3 .25% ) for the Construction Contractor. (iii) total combined General Conditions Costs and sub-Subcontractor's Fee of fifteen percent( 15% ) of the cost of that portionof the Work to beperformed by aSub Trade Contractor with its CMtnforces, or anyICMter tier of Trade Contractor, plus threeand one/quarter percent (3.25% ) for the Trade Contractor, plus three and one/quarter percent (3.25% ) for the Construction Contractor. Total combined Construction Contractor, Trade Contractor and all Sub-Trade Contractor fees and General Conditions Costs will not exceed these mark-ups. In accordance with the Construction Contract, as a condition precedent to anyChanges in the Work, the parties acknCMtledge that the Corporation must procure the prior written consent of the Construction Monitor, which consent may be withheld unless and until the Project's designated Construction rrnnitor certifies that (a) Corporation has procured sufficient funds to pay for such

C-7 Changes, (b) such Changes will not materially irrpact the quality of the Project and (c) that the Construction Schedule will not bematerially and adversely impact bysuch Changes. There wi11 beno reduction i n the Contractor' s Fee or the General Conditions Costs as a result of deductive changes to the Work. In the event of deductive changes, Construction Contractor' s Fee and General Conditions Costs will continue to be calculated on the initial GMP. HONever, the parties wi 11 negotiate an equitable reduction to the GMP, with respect to Construction Contractor General Conditions and Fee, if appropriate, on a case-by-casebasis, in connectionwith the deductive alternates set forth on Exhibit E to the Construction Contract. Subcontracts and Other Agreements

Other than Work certain miscellaneous labor, Construction Contractor will subcontract the Work to subcontractors other than the Construction Contractor, its subsidiaries, or other affiliates. Only properlyIi censed Subcontractorsmay perform work on the Project. Construction Contractor's Obligations under Subcontracts. No use of a subcontractor will relieve the Construction Contractor of any of its obligations or liabilities under the Construction Contract. The Construction Contractor will be fully responsible and liable for the acts or omissions of all subcontractors and suppliers including persons directly or indirectly employed by them. The Construction Contractor wi11 have sole responsibi Ii ty for managing and coordinating the operations of its subcontractors and suppliers, including the settlement of disputes with or between the Construction Contractor and anysuch subcontractor. The Construction Contractor wi11 include in each subcontractand require each subcontractor to include in anyIONer tier subcontract, any provisions necessary to makeall of the provisionsof the Construction Contract and the General Conditions fully effective as applied to subcontractors. The Construction Contractor will provide all necessary Plans, Specifications, and instructions to its suppliers and subcontractorsto enable them to properlyperform their work. Construction Contractor may include in its subcontracts such additional provisions as it deems appropriate to protect the Construction Contractor or to advancethe bestinterests of the Project. Subcontractor Selection. Unless specifically waived in writing by the Corporation, the selection of all Subcontractors will be made bycompetitive bid, proposals or quotes in a manner that will not encourage favoritism or substantially diminish competition. The Construction Contractor wi11 obtai n bids from Subcontractors and from suppliers of materials or equipmentfabricated to a special design for the Work from the list previously reviewed and, after analyzing such bids, the Construction Contractor will deliver such bids to the Corporation and Architect. The Corporation will then determine, with the advice of the Construction Contractor and subject to the reasonable objection of the Architect, which bids will be accepted. The Corporation may designate specific persons or entities from whom the Construction Contractor will obtain bids; hONever, the Corporation may not prohibit the Construction Contractor from obtaining bids from other qualified bidders. The Construction Contractor will not be required to contract with anyoneto whom the Construction Contractor has reasonable objection. Subject to the provisions described above, if the Guaranteed Maximum Price has been established and a specific bidder arrong those whose bids are delivered by the Construction Contractor to the Corporation and Architect (1) is recommended to the Corporation by the

C--8 Construction Contractor; (2) is qualifiedto performthat portionof the Work; (3) has submitted a bid which conforms to the requi rell"Ents of the Contract Docu!l"Ents without reservations or exceptions, but the Corporation requires that another bid be accepted, then the Construction Contractor rray requi re that a change i n the Work be issued to adjust the Contract Ti l1"E and the Guaranteed Maximum Price byt the difference between the bid of the person or entity recom!l"Ended to the Corporation byt the Construction Contractor and the amount of the subcontract or other agreell"Ent signed with the personor entitydesignated bytthe Corporation. Subcontractsand agree!l"Entswith suppliers furnishing rraterials or equipll"Entfabricated to a special design wi 11 not be awarded on the basis of cost plus a fee without the prior consent of the Corporation and the Construction Monitor. The Construction Contractor wi11 schedule and conduct !l"Eetings at which the Corporation, Architect, Construction Contractor and appropriate Subcontractors can discuss the status of the Work. The Construction Contractor will prepare and promptly distribute !l"Eeting ninutes. Promptly after the signing of the Construction Contract, the Construction Contractor will prepare a written Construction Schedule in accordance with the General Conditions, including the Corporation's occupancyrequirell"Ents as identified in the Construction Contract and upon which the GMP is based. The Construction Contractor will provide monthly written reports to the Corporation and Architect on the progress of the entire Work. The Construction Contractor will rraintain a daily log containing a record of weather, Subcontractors working on the site, number of workers, Work accomplished, problems encountered and other simi I ar relevant data as the Corporation may reasonably require. The log will be available to the Corporation and Architect imll"Ediately upon request. The Construction Contractor wi 11 develop a system of cost control for the Work, incl udi ng regular monitoring of actual costs for activities in progressand estirrates for uncompleted tasks and proposedchanges. The Construction Contractor wi11 identify variancesbetween actual and esti rrated costs and promptly report in writing the variances to the Corporation and Architect at regular intervalsand uponreasonable request bytCorporation. Construction Contractor wi11 be responsible for the workrranli ke performance of alI construction perfor!l"Edin the Project. In this regard, Construction Contractor will have the authority to reject non-compliant work and to require all contractors or Subcontractors or Sub-subcontractors, as the case rray be, to removeand correct al I non-compliant work. Construction Contractor will develop the bidding docu!l"Ents, other than the Drawings and S pecifi cations prepared byt the Architect, and any suppl e!l"Ents thereto needed to integrate and complete such bidding docu!l"Ents. Construction Contractor will review addenda and clarifications, interpret the bidding docu!l"Entsand assist the Architectas requested bytthe Corporation. Construction Contractor will conduct a pre-bid !l"Eeting with all qualified potential bidders with respect to the bidding docu!l"Ents to help identify questions or problem areas that the bidders rrayraise.

C--9 The Construction Contractor wi 11 receive bids for each of the trades. Construction Contractor wi 11 analyze such bids for sufficiency, completeness and conformance to the detaiI ed estimates. Construction Contractor will refer any bid protest to the Corporation and its legal counsel for resolution. Where possible, the Construction Contractor wi 11 endeavor to obtain a mini mum of three bids or proposals in each trade category. The Construction Contractor will make good faith efforts, reasonable under the circumstances, to obtain a maximum amount of local competition from firms with prior experienceon projects si miI ar in size and complexityto the Project. Subcontractingby Construction Contractor. The Construction Contractor, subsidiaries, other affiIi ates or businesses in which it has a fi nancial interest (including parent companies and related businesses under the sameholding company) may bid in accordance with the Construction Contract to do work with its CMtnforces, providedat Ieast So>/o of the Iabor bysuch work unit is perforrrEd by employeesof the Construction Contractor, subsidiary, or affiliate. For those items for which the Construction Contractor or any of its subsidiaries intends to bid, such intent must be announced with the solicitation for bids required by the Construction Contract, and the Corporation notified in writing. All bids for this work will be delivered to the Corporation and opened bythe Corporation at a specific tirrE, date, and place. Progress Payments

Based uponApplications for PayrrEnt submitted to the Architect and Corporation by the Construction Contractor and Certificates for PayrrEnt issued by the Architect, the Corporation will makeprogress payrrEnts on accountof the Contract Sum to the Construction Contractor during the Construction Phase for each portion of the Project as provided belCMt and els01Vhere in the Contract DocurrEnts. The Construction Contractor will, by the third (3rd) day of each month ("Current Month") deliver to the Architect and Corporationan "Application for PayrrEnt"for the Project in the form of a typed staterrEnt projected through the 1 0th day of the current month, which wi11 be sworn to and notarized if required by Corporation or the Construction Monitor shCMting in complete detail (itemized by Subcontractor, Sub-subcontractor and Construction Contractor's CMtn forces, if any): (i) all moniespaid out or costs incurred bythe Construction Contractor on account of the Cost of the Work duri ng the period comrrEncing on the fi rst ( 1st) day of the month preceding theCurrent M onth and ending on the last day of said preceding month ("PayrrEnt Request Period") for which the Construction Contractor is to be paid under the Construction Contract, and (ii) the amount of the Construction Contractor' s Feedue. The Application for PayrrEntwill be subrrittedwith such supportingdocurrEntation as may be reasonably required by the Corporation, the Architect, or the Construction Monitor and will incl ude, without Iirri tati on, copies of requi siti ons from Subcontractors, S ub-subcontractors and material suppliers, and conditional waivers and releases of liens, stop notices and bond rights for the current Application for PayrrEnt and unconditional waivers and releases of liens, stop notices and bond rights to the extent of all prior payrrEnts, from Construction Contractor, all Subcontractors, Sub-subcontractors, suppliers and anyone having liens rights, stop notice rights or rights against the Project or any bondfor the Project, all of which waivers and releases will be in accordance with the provisions of California Civil Code. The Application for PayrrEnt will beon the AIA G702 form or such other form acceptable to the Corporation, the Architect and Corporation's Construction Monitor.

C-10 Each Application for Payment will be based upon the schedule of values submitted by the Construction Contractor in accordance with the Contract Documents. The schedule of values will allocate the entire Guaranteed Maximum Price for the Project among the various portions of the Work for the Project; except that the Construction Contractor's Fee will be shONn as a single separate item. The schedule of values will be prepared in such form and supported by such documents and information to substantiate its accuracy as the Architect mayrequire. This schedule, unless objected to by the Architect, will be used as a basis for reviewing the Construction Contractor's Application for Payment. Applications for Payment will shON the percentage completion of each portion of the Work for the Project as of the end of the periodcovered by the Application for Payment. The percentage completion wiII be the percentage of that portion of the Work for the Project that has actually been completed. Subject to other provisionsof the Contract Documents, the arrountof each progress payment wi 11 becomputed and processedas folI ONs: (1) Take that portion of the Guaranteed Maximum Price properly allocable to completed Work for the Project as determined by multiplying the percentage completion of each portionof the Work for the Project bythe Guaranteed Maximum Price allocated to that portion of the Work in the schedule of values, Iess retai nage of five percent (5% ). Pending final determination of cost to the Corporation of changes in the Work arrounts not in dispute may be included as provided in the General Conditions, even though the Guaranteed Maximum Price has not yet been adjusted by Change Order. (2) Add that portion of the Guaranteed Maximum Price for the applicable portion of Work properly allocable to materials and equipment delivered and suitably stored at the site for subsequent incorporationin the Work (provided the risk of Ioss of such materialsand equipmentwi 11 transfer only upon the conditions in the General Conditions) or, if approved in advance by the Corporation, suitably stored off the site at a location agreed upon in writing, less retainage of five percent( 5% ) . (3) Subtract the aggregate of previous payments made bythe Corporation. (4) Subtract arrounts, if any, for which the Architect has withheld or nullified a Certificate for Paymentas providedin the General Conditions. The Corporation will review the Application for Payment for each Payment Request Period and will promptly issue or cause the Architectto issue to Corporation (not later than five (5) business days after the Corporation's and Architect's receipt of the Application for Payment) a Certificate for Payment for the arrount requested in the Application for Payment pursuant to the Construction Contract. The Certificate for Payment describedabove wi 11 be paid on or beforeten ( 10) business days after Corporation'sissuance or receipt of the Certificate for Payment; provided, hONever, paymentto the Construction Contractor must also be approved by Corporation's Construction Monitor in accordance with the applicable provisions of the Contract which will be obtained to meet the Corporation's payment schedule set forth in the Construction Contract. Notwithstanding the foregoing, the Corporation, in its sole and absolute discretion, but subject to the prior consent of the

C-1 1 Construction Monitor, maypay rrnrethan the arrnuntset forth in the Certificate for Paymentless the applicable retention percentage set forth in the Construction Contract for any Subcontractors who have completed their work prior to Substantial Completion of the Project. Any single payment, or series of payments, by the Corporation to the Construction Contractor in excess of the arrnunt set forth in the Certificate for Payment less the applicable retention percentageset forth in the schedule of retainage above wi 11 not constitute a waiver of the Corporation's rights to pay only the arrnunt set forth in the Certificate for Payment less the applicable retention percentage as set forth in the schedule of retai nage above in the future. Corporationreserves the right to makeprogress payments in the form of checks made jointly payable to Construction Contractor and any Subcontractor, Sub-subcontractor or supplier to whom rrnnies are CMting if the Corporation has an objective basis upon which the alleged that the Construction Contractor is unable to meet its financial obligations under the Construction Contract. In such event, Corporation will provide Construction Contractor with seven (7) days written notice stating the basis of such concern duri ng which time Construction Contractor may provide to the Corporation adequate assurances of its ability. Within said ten (10) business day period after Corporation's and Architect's receipt of the Application for Payment, the Corporation or the Architect will notify the Construction Contractor, in writing, of any reasons for withholding a Certificate for Payment for any portion of the arrnunt set forth in the Application for Payment. No portion of the sums retai ned by the Corporation pursuant to this paragraph wi 11 be payable wi11 be released, until Substantial Completion of the applicable portion of the Project, at which time Corporation may withhold the value of incomplete or defective Work until completed or remedied (as the case may be). Corporation will cooperate with Construction Contractor upon Construction Contractor' s request for release of alI or a portion of the sums retained by Corporation prior to Substantial Completion of a portion of the Project if Construction Contractor derrnnstrates, to Corporation's satisfaction, that such early release will provide Corporation with an economic savings. Corporationwill havereceived a lien waiver conditioned only upon ProgressPayment for all Work performed bysuch Subcontractor. Except with the Corporation's prior written approval, the Construction Contractor will not makeadvance payments to suppliers for materials or equipment which have not beendelivered and stored at the site. In taking action on the Construction Contractor's Applications for Payment, the Architect will be entitled to rely on the accuracy and completeness of the information furnished by the Construction Contractor and will not be deemed to represent that the Architect has made a detailed examination, audit or arithmetic verification of the documentation submitted; that the Architect has made exhaustive or continuous on-site inspections; or that the Architect has made examinations to ascertainhCMt or for what purposesthe Construction Contractor has used arrnunts previously paidon account of the Contract. Such examinations, audits and verifications, if required bythe Corporation, wi 11 beperformed bythe Corporation'saccountants acting in the sole interest of the Corporation. Included in Exhibit A to the Construction Contract is the Construction Contractor's Schedule of Values. The Schedule of Values is al Iocated to the various portions of the Work and wi11 be used as the basisfor reviewing the Construction Contractor's Applications for Payment.

C-12 The issuance of a Certificate for Payment wi II constitute a representation bythe Architect to the Corporation, based on the Architect's observations at the site and the data comprising the Application for Payment, that the Work has progressed to the point indicated and that the record documents are current and that the quality of the Work is in accordance with the Contract Documents. The foregoing representations are subject to an evaluation of the Work for conformance with the Contract Documents upon Substantial Completion, to results of subsequent tests and inspections, to ninor deviations from the Contract Documents correctable prior to completion and to specific qualifications expressed by the Architect. The issuance of a Certificate for Payment will further constitute a representation of Architect that the Construction Contractor is entitled to payment in the amount certified. The issuance of a Certificate for Payment will not be a representation that the Architect has made exhaustive or continuous on-site inspections to check the quality or quantity of the Work. The issuance of a Certificate for Paymentwill not be arepresentation that the Architect has made exanination to ascertain hCMt or for what purpose the Construction Contractor has used moneypreviously paidon account of the Contract Sum Decisions to Withhold Certification. The Architect will not certify payment and may withhold a Certificate for Payment, in whole or in part, to the extent reasonably necessary to protect the Corporation if the representations to the Corporation required by the Construction Contract cannot be made. If the Architect is unable to certifypayment in the arrount of the Application, the Architect will notify the Construction Contractor and Corporation as provided in the Construction Contract. If the Construction Contractor and Architect with the approvalof Corporationcannot agree on a revised arrount, the Architect will promptly issue a Certificate for Payment for the amount for which the Architect is able to make such representations to the Corporation. The Architect or Corporation may also decide not to certify payment or, because of subsequently discovered evidence or subsequent observations, may nullify the whole or a part of a Certificate for Payment previously issued, to such extent as may be necessary in the Corporation's or Architect's opinion to protect the Corporationfrom Ioss becauseof: (1) defective Work not remedied; (2) third party clai ms fi Ied or reasonable evidence i ndicati ng probable fiIi ng of such claims; (3) failure of the Construction Contractor to make payments properly to Subcontractors or for Iabor, materialsor equipment; (4) reasonable evidence that the Work cannot be completed for the unpaidbalance of the Contract Sum; (5) damageto the Corporationor another contractor; (6) reasonable evidence that the Work will not be completed within the Contract Time, and that the unpaid balance would not be adequate to cover actual or Iiqui dated damages for the anticipateddelay; or

( 7) persistentfai I ure to carry out the Work in accordance with the Contract Documents. When the above reasons for wi thhol ding certification are rern::wed, certification wi 11 be made for amounts previously withheld. Corporation will not be deemed in default by reason of

C-13 withhol ding an appropriate arrnunt of payment whiI e any of the above grounds remain uncured. In taking action on Construction Contractor's Applications for Payment, Corporationwill beentitled to rely on the accuracyand completeness of the information furnished byConstruction Contractor and will not be deemed to represent that Corporation has made audits of the supporting data, exhaustive or continuous on site inspections or that Corporation has madeany examination to ascertain hCMt or for what purposes Construction Contractor has used the rronies previously paid on account of the Contract. In the event Corporation determines that any arrounts previously paid to Construction Contractor exceeded the arrounts which were properly payable, Corporation will, in addition to all other rights and remedies under the Construction Contract or under the law, have the right at its option either to: (i) deduct the arrnunt of such overpayment from the next succeeding progress payment(s) due Construction Contractor, or (ii) require Construction Contractor to promptly repayto Corporationthe arrountof such overpayment. When in Construction Contractor's opinion such withholdings by the Corporation are unreasonable, Construction Contractor may request, and Corporation will participate in, a revieN of the matter(s) by athird-party neutral arbitrator, whose decision will be adhered to by the parties for the linited purpose of resolving the payment certification dispute and so as not to affect the continuing progressof the work. Such revieN wi 11 occurwithin 20 days of Construction Contractor' s request, and a recommendation wi11 be issued within 1 0 days after the one day ( or Iess) presentation by the parties to a neutral arbitrator. Any proceeding under this paragraph will be pursuant to a JAMS / Endi spute "fast--track'' process. It is understood by the parties that any decision by an arbitrator under this paragraph is interim i n effectand wi 11 not Ii mit or in anyway estop a partyfrom requiring that this matter(s) Iater be fi nally considered in the manner set forth i n the dispute resolution sections of these Contract Documents. Final Payment

Final payment constituting the unpaid balance of the Cost of the Work and Construction Contractor's Fee (subject to any retention with respect to minor Work or Defective Work) with respectto the applicable portionof the Project will bedue and payable thirty-five (35) days follONing the recordation of a valid Notice of Campi etion for the Work with respectto the applicable portionof the Project; provided that the Construction Contractor has first delivered to the Corporation (or Architect if Corporation so requests) such other evidences of the Construction Contractor's full payment of, and lien releases (in the form mandated by California Civil Code Section326 2) by Subcontractors, Sub-subcontractors and suppliers (with the exception of retentions and final payments which are to be paid out of the final payment of the Corporation to the Construction Contractor) and the absence of any Ii ens generated by the Work as may be required by the Corporation, Corporation's Construction Monitor or a title insurance carrier prior to insuring the absence of all liens generated by the Work; and provided further, that (a) the Corporation has first received the Architect's Certificatefor Payment, which Certificate states that the evidences delivered byConstruction Contractor are sufficient to indicate said payment of S ubcontractors, S ub-contractors and suppliers and absence of liens, and (b) the Construction Contractor has delivered to Corporation (i) maintenance and operating manuals required under the Specifications, (ii) all warranties and guaranties in connection with the Work, (iii) as-built drawings for the Project; and (iv) the Construction Contractor's final accounting for the Project and Corporation has approved such final accounting in accordance with the termsof the Construction Contract. Corporation reserves the right to makefinal payment in the form of checks made jointly payable to the Construction Contractor and any Subcontractor, Sub-subcontractor and supplier entitled to payment out of the funds provided by the final paymentif Corporation believes in good faith that the issuance of joint checks is necessary

C-14 to protect Corporation's interests. Construction Contractor will pravide evidence satisfactory to Corporation and the Architect establishing the identities of such persons and the arrnunts of the paymentsto which theyare entitled. If there should rerrain minor items to be completed, the Architect, the Construction Contractor and the Corporation will list such items (" Punch List'') and the Construction Contractor will deliver, in writing, his unconditional promise to complete such Punch List items within a reasonable time follONing Substantial Completion of the Project, which reasonable time will be specified in said written promise. Items that are capable of being performed with in 60 dayswill be so performed. Iterns not capable of being performed in such time period wi 11 be performed in a reasonable time period with diligence on the part of the Construction Contractor. The Corporation may retain an arrnunt equal to one hundred fifty percent ( 1 5QJ/o ) of the cost to complete the Punch List items, as determined by Corporation, until such time as the work described in the Punch List is completed. Within seven (7)days follONing the Construction Contractor's written notification to the Corporation that the work described in the Punch List has been completed, the Corporation will determine whether said work has, in fact, been completed. Corporation will rrake payment for the work described in the Punch List within fifteen (15) days after the date on which the Corporation determines such work has beencompleted. The arrnuntof the final paymentfor the Project will becalculated as follONs: Take the sum of the Cost of the Work for the Project substantiated by the Construction Contractor's final accounting and the Construction Contractor's Fee for such portion of the Project; but not rrnrethan the GuaranteedMaximum Contract Price for the Projectas adjusted, Subtract arrnunts, if any, for which the Corporation's Representative withholds, in whole or in part, pursuant to the final Certificate for Payment based on any work not completed in conforrrancewith the Contract Documents, inaddition to the retention arrnunt, Subtract the aggregate of previous payments rm.de by the Corporation to the Construction Contractor. If the aggregate of previous payments rm.de bythe Corporation exceedsthe arrnuntdue to the Construction Contractor, the Construction Contractor will reimburse the difference to the Corporationwithin twenty (20) days. Any payment rm.de after 30 days will bear interest at the rate of one and one;half percent ( 1.5% ) per rrnnth from the date thirty ( 30) days after the date the Corporation informs the Construction Contractorof the arrnunt due. The final application for payment will be accompanied by a Conditional Waiver and Release Upon Final Payment from Construction Contractor and each of its first tier Subcontractors (in the form mandated byCivil CodeSection 3262), shONing that all rraterials, labor, equipment, and other bills associated with the Work will be paid in full and all stop notices relating thereto will be rel eased and discharged out of the proceeds of the final payment. The Construction Contractor agrees and warrants that it will fully and timely pay and be responsible for all costs of the Work including rraterials, labor, equipment, and other bills associatedwith the Work. Concurrently with receipt of final payment, Construction Contractor will pravide its ONn Unconditional Waiver and Release Upon Final Payment (in the form rrandated by Civil Code Section 3262), shONing that alI rraterial s, Iabor, equi pment, and other bi 11 s associated with the Work have been paidor will bepaid in full and all liens relating thereto have been unconditionally released and discharged.

C-15 The Construction Contractor will then subnit to the Corporation's Administrator a request for paymentof the remaining Contract balance. The Construction Contractor wi 11 be notified by the Corporation of the date of recordation of the Notice of Completion. The retention payment will be processed bythe Corporation30 calendar daysafter the date of recordation bythe countyrecorder. The Corporation will continue to retain funds to cover liquidated damages, stop notices and/or mechanic's liens, state labor commissioner claims, back charges from the Corporation, unexecuted credit change orders, and other such claimsthat maybe received up to the end of the 30- day period follCMting recordation. If any stop notice and/or mechanic's lien has been filed, payment will be withheld in an amount of at least 125 percent of the total claims file until either the rights under the stop notice and/or mechanic's lien have been settled or the Construction Contractor has postedsufficient bond i n an amountof at Ieast 12 5 percent of the total claimsfi Ied to secure payment of such claims. In the event that the actual and final cost of the Work plus the Construction Contractor fee as specified in the Construction Contract is Iess than the fi nal GM P, the difference wi 11 accrue to the Corporation. When the Construction Contractor considers that the Work, or a portion thereof which the Corporation agrees in writing to accept separately, is substantially complete, the Construction Contractor wi11 prepareand submit to the Architect a comprehensive Ii st of itemsto be completed or corrected. The Construction Contractor will proceed promptly to complete and correct items on the list. Failure to include an item-on such list does not alter the responsibility of the Construction Contractor to complete alI Work in accordance with the Contract Documents. U pon receipt of the Construction Contractor' s Iist, the Architectwi 11 makean inspection to determine whether the Work or designated portion thereof is substantially complete. If the Architect's inspection di sci oses any item, whether or not included on the Construction Contractor's list, which is not in accordance with the requirements of the Contract Documents, and such item precludes Substantial Completion, the Construction Contractor wi11, before issuance of the Certificate of Substantial Campi eti on, complete or correct such item upon notification by the Architect. The Construction Contractor will then submit a request for another inspection bythe Architect to determi ne Substantial Campi eti on. When the Work or designated portion thereof is substantially complete, the Architect will prepare a "Certificate of Substantial Completion" which will establish the date of Substantial Completion, will establish responsibilities of the Corporation and Construction Contractor for security, maintenance, heat, utiIi ti es, and wi 11 fix the ti mewi thi n which the Construction Contractor wi 11 finish alI i ternson the list accompanying the Certificate. Warranties required by the Contract Documents will commence on the date of Substantial Campi etion of the Work or designated portion thereof uni ess otherwise provided in the Certificate of Substantial Completion. The Certificate of Substantial Completion will be submitted to the Corporation and Construction Contractor for their written acceptance of responsibi I ities assigned to them in such Certificate. U ponSubstantial Campi eti on of the Work or designatedportion thereof and uponapplication by the Construction Contractor and certification by the Architect with the approval of the Corporation, the Corporationwill make payment, reflecting adjustment in retainage, if any, for such Work or portionthereof as providedin the Contract Documents. The Corporation may occupy or use any completed or partially completed portion of the Work at any stage when such portion is designated by separate written agreement with the Construction Contractor, provided such occupancyor use is consented to by the insurer as required

C-16 under the Construction Contract and authorized byt public authorities having jurisdiction over the Work and approved byt the Construction Monitor. Such partial occupancy or use may commence whether or not the portion is substantially complete, provided the Corporation and Construction Contractor have accepted in writing the responsibilities assigned to each of them for payments, retainage, if any, security, maintenance, heat, utilities, damage to the Work and insurance, and have agreedin writing concerni ng the period for correctionof the Work and commencement of warranties required bytthe Contract Documents. Consent of the Construction Contractor to partial occupancyor use wi11 not beunreasonably withheld. The stage of the progress of the Work wi 11 be deterrrined byt written agreement between the Corporation and Construction Contractor or, if no agreement is reached, bytdecision of the Architect. Immedi ately prior to such partialoccupancy or use, the Corporation, Construction Contractor and Architectwi 11 jointly i nspectthe area to beoccupied or portionof the Work to beused in order to determine and record the condition of the Work. U nl ess otherwise agreed upon, partial occupancyor use of a portion or portions of the Work wi 11 not constitute acceptance of Work not complying with the requirements of the Contract Documents. The Corporation's accountants will review and report in writing on the Construction Contractor's final accounting within 30 days after deliveryof the final accounting to the Architectbyt the Construction Contractor's final accounting within 30 days after delivery of the final accounting to the Corporation byt the Construction Contractor. Based upon such Cost of the Work as the Corporation's accountants report to be substantiated byt the Construction Contractor's final accounting, and provided the other conditions of the Contract Documents have been met, the Architect wi 11, within seven days after receipt of the written reportof the Corporation's accountants, either issue to the Corporation a final Certificate for Payment with a copy to the Construction Contractor, or notify the Construction Contractor and Corporation in writing of the Architect's reasons for withholding a certificate as provided in the General Conditions. The timeperiods stated in this Paragraph supersedethose statedin the General Conditions. If the Corporation's accountants report the Cost of the Work for a portion of the Project as substantiated byt the Construction Contractor' s fi nal accounting to be ess I than cl ai med byt the Construction Contractor, the Construction Contractor will be entitled to proceed in accordance with the dispute resolution procedures of the Construction Contract without a further decision of the Architect. Unless agreed to otherwise, a demand for mediation or arbitration of the disputed amount will be made byt the Construction Contractor within 60 days after the Construction Contractor's receipt of a copy of the Architect's final Certificate for Payment for the applicable portion of the Project. Failure to make such demand within this 60-day period will result in the substantiated arrnunt reported bytthe Corporation'saccountants becorring binding on the Construction Contractor. Pendi ng a final resolution of the disputed arrnunt, the Corporation wi 11 pay the Construction Contractor the amountcertified in the Architect's final Certificate for Payment. If, subsequent to final payment and at the Corporation's request, the Construction Contractor incurs costs alI CMted pursuant to the Construction Contract or arising from the resolution of disputes, the Corporation will reimburse the Construction Contractor such costs and the Construction Contractor's Fee, if any, related thereto on the samebasis as if such costs had beenincurred prior to fi nal payment, but only to the extent such costs and fee are not in excess of the Guaranteed Maxi mum Price for the applicable portionof the Project.

C-17 GENERAL CONDITIONS

Definitions

Addendum -A documentissued bytthe Architect prior to the agreement on the Guaranteed Maximum Price (GMP) that modifiesor supersedesportions of the contract documents. Agreement Date -The day on which the last party to the Construction Contract signs the Construction Contract. Architect - The person or organization, including the authorized representatives thereof, comnissioned byt the Corporation for the project. For projects on which an engineer or landscape architect is commissioned instead of an architect, the term "Architect'' will mean the design professional so commissionedfor the project. Campus -California State University, Fresno, a campus of the California State University system, on which the project is located. Change Order -A written agreemententered into after the effective date of the Construction Contract that alters or amendsthe Construction Contract. Construction Inspector -The Inspector on the project site who receives technical direction from the Architect and Project Manager and adninistrative direction from the Corporation's Representative. Construction Monitor -The representative of the Bond Trustee for bond proceeds which partiallyfund the cost of construction. Construction Manager N eneral Contractor (Construction Contractor) - The contractor who is selected to revieN the construction documentsand who agrees upon a Guaranteed Maxi mum Price to perform the work identified in the contract documents. The Construction Contractor will solicit trade bids from Trade Contractors on a competitive basis and enter into contracts with these Trade Contractors to performtheir trade work. Construction Manager Neneral Contractor (Construction Contractor) Standard of Care - Construction Contractor will perform the Work exercising the degree of skill and diligence of a national contractor involved in similar projects. The phrases "kneN or should have knCMtn", "discovered or should have discovered" and " recognized or should have recognized" as used in the Contract Documents wi 11 refer to the knCMtledge Construction Contractor had or should have had or that Construction Contractor discovered or should have discovered ( as applicable) in performing the Work. Contract -The documents which collectively represent the entire agreement between the Corporation and the Construction Contractor, and which supersede any prior negotiations, representations, or agreementseither written or oral. Contract Documents - (i) The Construction Contract between Corporation and the Construction Contractor (including attachedExhibit s);

C-18 (ii) The General Conditions of the Contract for Construction (" General Conditions"); (iii) The Construction Documents. Contractor -The person or business entity who has entered into the Construction Contract with the Corporation. Contractor Fee -The full arrnunt of compensation, both direct and indirect with respect to the Project to be paid to Construction Contractor for its CMtn Work and the Work of all Subcontractors. The Contractor Fee will not becompounded. Contract Time - The period of time from the date of Commencement of the Work as stated in the full Notice to Proceed, through and including the Substantial Completion Date, as adjusted pursuant to the termsof the Contract Documents. Corporation -The California State University, Fresno, Association,Inc. Corporation's Representative -The person delegated by the Corporation to manage the construction phase of the project, and who is authorized to approve changes to the contract. The Construction M oni tor and the Corporation's Representative wi 11 bethe same individual or entity. Guaranteed Maximum Price - The rraximumprice, subjectto adjustmentas set forth in the Contract Documents, that the Corporation and Construction Contractor agree upon as payment for supplying and instal Ii ng alI the Work, as more specificallyset forth in the Construction Contract. Hazardous Materials - Means any substance: (1) the presence of which requires i nvestigati on or remediation under any federal, state or Iocal stature, regulation, ordinance, rule, code, order, action, policyor commonI cNV in effectat the ti meof execution of the Contract or which becomes effective at any ti me prior to the expiration of the term of the Contract, or (2) which is or becomesdefined as a "hazardouswaste," "hazardous substance," polIutant or contaminant under any federal, state or Iocal statute, regulation, rule or ordinance or amendmentsthereto in effect at the time of execution of the Contract or which becomes effective at any time prior to the expiration of the term of the Contract, including, without limitation, the Comprehensive Environmental Response Compensationand Liability Act (42 U .S.C. Sections 9601 et seq.) andpr the Resource Conservation and Recovery Act (42 U .S.C. Sections 6901 et seq.); or (3) which is toxic, explosive, corrosive, flammable, infectious, radioactive, carcinogenic, mutagenic, or otherwise hazardous and is regulated at the time of execution of the contract or becomes regulated any ti me prior to the expiration of the term of the Contract byany governmental authority, agency, department, commission, board, agency or i nstrumentality of the U ni ted States, the State of California or any political subdivision thereof or (4) the presence of which on the Projectcauses or threatens to cause a nuisance uponthe Project or to adjacent properties or poses or threatens to pose a hazard to the heal th or safety of persons on or about the project; or (5) which contains gasoline, diesel fuel or other petroleum hydrocarbons; or (6) which contains polychlorinated biphenyl's (PCBs), asbestos or urea formaldehyde foam insulation. Plans (sometimes" Drawings") -The drawings prepared by the Architect and approved by the Corporation which include elevations, sections, details, schedules, diagrams, information, notes, or reproductionsor anyof these, and which shCMt the location, character, dimension, or details of the work.

C-19 Project -The total Work required byt the contract.

Project Man ager -The on-site representative of the Corporation, but without the authority to approvechanges to the contract.

Site - The area specified in the contract for the project and the area rm.de available for the Construction Contractor' s operation.

Specifications - The instructions and requirell"Ents prepared byt the Architect which compl e!l"Ent the pl ans and describe the rm.nnerof performingthe work or the quantities, qualities and typesof rm.terials to be furnished.

State -State of California.

Subcontractor -Any person or business entity that contracts with Construction Contractor to furnish either laborand rm.terialsor equipll"Ent or labor only.

Substantial Completion - The stage in the progress of the Work when the Work is sufficiently cornplete i n accordance with the Contract Docu!l"Ents so the Corporation can occupyt or utilize the Work for its intended use; provided, hONever, the date of Substantial Completion will not precede the day on which the Corporation receives 1) a "signed off' notice of final inspection (or its equivalent in a form acceptable to Corporation) from the California State Fi re M arwi 11 and al I other applicable Authorities; 2) a certificate of occupancy (or its equivalent in a form acceptable to Corporation); and 3) all other permits and approvals required byt any and all applicable Authorities for Corporation's intended occupancy and operation of the Project (collectively, the "Substantial Corypleti on I terns").

Trade Contractors - Appropriately licensed specialty contractors contracting with the Construction Contractor to performportions of the Work.

Trustees -The Board of Trustees of the California State University and their authorized representatives who act on behalfof the Trustees.

University -The California State University, Fresno, and the University President and other University officers and empl0ytees acting within the scope of their duties.

Work -That which is to be constructed or done under the Construction Contract, including the furnishing of all labor, rm.terials, and equipll"Ent, as well as the perforrm.nce of all other services described in applicable sectionsof the Construction Contract.

Investigation By Construction Contractor

Necessityfor Careful Examination of Site. Plans. and Specifications.

The Construction Contractor and Trade Contractors will carefully examine the site and the plans and specificationsfor the project and will investigate and be satisfied as to the conditions to be encountered, the character and quantity of surface and subsurface rm.terials or obstacles to be encountered, rights of way and ease!l"Ents at or near the site, the work to be performed, and rm.terial s to be furnished and as to the requi rell"Ents of the proposal , pl ans, and specifications for the project.

C--20 Any faiI ure by the Construction Contractor and Trade Contractors to acquaint themselves with inf ormation that is avaiIable or with reasonable i nvestigati on maybe avaiI able wi11 not relieve it from responsibilityto properlyestimate the difficulty or cost to performthe work. Such examination does not require independent underground soi I borings or other testing uni ess required elsewherei n the contract documents. The Construction Contractor will carefully study and compare the Contract Documents with each other and with informationfurnished bythe Corporationpursuant to the Construction Contract, as well as the Construction Contractor's field measurementsand will at once report to the Architect errors, inconsi stenci es or onissi ons discovered, except as otherwise provided in the Construction Contract. The Construction Contractor will not be liable to the Corporationor Architect for damage resulting from errors, inconsistencies or onissions in the Contract Documents unless the Construction Contractor actually recognized such error, inconsistency or omission and failed to timely report it to the Architect. If the Construction Contractor performs any construction activity which it knew or should have knCMtn, in the reasonable exercise of its Standard of Care, involves an error, inconsistency or omission in the Contract Documents without such timely notice to the Architect, the Construction Contractor will assume the appropriate responsibility for such performanceand wi11 bearthe attri butabl e costs for correction. Where investigations of subsurface conditions have been made bythe Corporation, and that informationis madeavailable to the Construction Contractor, such informationis limitedin scope to that which has been actually encounteredin the i nvestigati ons. Construction Contractor has relied on such inf ormation in establishing the GM P. During the progress of the work, if a subsurfaceor latent condition is encountered at the site that is substantially different from those indicated in the contract documents or made available for examination, or differs from conditions typical to the area a differing site condition mayexist. The Construction Contractor wi 11 immediately notify the Architect and the Construction Inspector in writing of the differingsite condition. Such will be handled pursuant to applicable provisions of the Construction Contract and the General Conditions. Corporation will obtain necessary easements, rights of way, and permission from adjacent property CMtners' for work outside of the property lines, including tiebacks, utilities, access, etc., prior to the start of Work Clarification Prior to Guaranteeing the Maximum Price. The Construction Contractor has examined the pl ans and specifications in preparing the GM P and wi11 report to the Architect any omissions, discrepancies, or apparent errors found i n the plans and specifications. In general, Drawings will shCMt dimensions, positions, materials and kinds of construction; Specifications will describe quality of materials, workmanship and methods. Work called for on the Drawings and not mentioned in the Specifications, or vice versa, will be performed as though fully set forth in both. Work not particularly detailed, marked or specified will be the same as sinilar parts that are detailed, marked or specified. Figured dimensions on scale Drawings and on full size Drawings will govern overscale Drawings without figured dimensions. Should an error occurin the Specifications or Drawings, or in work by others affecting this Work, the Construction Contractor wi 11 at once notifythe Architect and the Corporationof any discovered errors. After consulti ng with Corporation with respect to such error, the Architect will issue instructions as to hCMtto proceed. If the Construction Contractor proceeds with the Work based on such an error, of which the

C--21 Construction Contractor has actual knCMtledge, without approvedinstructions from the Architect and Corporation, the Construction Contractor will correct, at its CMtn expense, any resulting damage or defects. Construction Contractor wi 11 be responsible to Corporation for causing alI S ubcontractorsto utilize the current updated version of the Drawings and Specifications at all times in performing the Work covered by their subcontracts. A copy of the current version of the Drawings and Specifications will be maintainedon the Project site at all times. Only the Architect or Corporation's Representative is authorized to answer questions or prepare addenda relative to the project. Information obtained from other sources is unauthorized, maynot berelied upon, and will have no standing in anyevent that mayoccur. Award and Execution of Construction Contract Award of Construction Contract. The Corporation has awarded the contract to the Construction Contractor to construct the project for an amount not to exceed the Guaranteed Maxi mum Price, including the Contractor's Fee. Contract Bonds. The Construction Contractor wi11 furnish in five duplicate counterparts, two surety bonds in the form prescribed by the Corporation, each in an amount equal to 1 00 percent of the awarded GMP and executed by an admitted surety insurer licensed in the State of California and listed in the latest published United States Treasury Department list of "Companies Holding Certificates of Authority as Acceptable Sureties on Federal Bonds and as Acceptable Reinsuring Companies". One of the surety bonds will guarantee faithful performance of the contract by the Construction Contractor and the other wi11 secure payment of Iaborers, mechanics, or materialmen employedon the project. Such bonds are subject to the approvalof the Corporation. Contract bonds wi 11 remain i n f ul I force and effectduri ng the term of the contract incl udi ng the one year guarantee period. All alterations, extensions of time, extra and additional work, and other changes authorized byany part of the contract, wi 11 be made without securi ng the consent of the suretyor sureties on the contract bonds, which sureties will be bound as if said modifications were a part of the original Contract. Whenever the Corporation has cause to believe that the surety has become insufficient, the Corporation maydemand in writing that the Construction Contractor provide such further bonds or additional surety, not exceeding that originally required, as in the Corporation'sopinion is necessary, considering the extent of the work remaining to bedone. Thereafter no payment wi11 be made to the Construction Contractor or any assignee of the Construction Contractor until the further bonds or additional suretyhave been furnished. Subcontractor Bidding Process. Except where the Corporation has given different direction Construction Contractor will proceed as follCMts with respect to bidding subcontract work. Construction Contractor will conduct a prebid conference with all bidders which the Corporation may attend. Construction Contractor will, using appropriate public notice and follCMting such prequalification procedures as are described in the bidding guidelines, submit the bid package to the Subcontractor trades. Prequalified Subcontractors, as approved by Corporation and Construction Contractor, will bid on each major category of Work, and the ICMtest responsive responsible bidder wi 11 be selected, uni ess otherwise directed by Corporation. In the event that Corporation does not select the ICMtest responsive responsible bidder, ConstructionContractor will bepermitted to increase

C--22 the Guaranteed Maxirrum Price by the arrDunt of the difference between the ICMtest responsive responsibl e bicider' s bid and the bid of the bi cider selected by Corporation. No proposed Subcontractor to whom Corporationhas a reasonable objection wi11 either (i) become prequal i fi ed (i n a two-stage bidding process) or (ii) be a responsible bi cider ( in a si ngle-stage bidding process). Construction Contractor wi 11 make every reasonable effort to obtain for Corporation a nini mum of three ( 3) separate bids from three ( 3) different qualifiedSubcontractors for each trade (or Line Itern ) unless such requirement is waived by Corporation in writing. Construction Contractor will be responsible for ensuring that all bids obtained are based upon and consistent with the Drawings and S pecifi cations and the other Contract Documents as approved and directed by Corporation, that alI bids are sufficiently detaiI ed to conform, and alI work and material included in the bids conform, to the requirements of the Contract Documents, standard industry practices in California and are in compliance with all applicable code requirements bearingon performance of the Work. Construction Contractor wi11 not make any substitution for any Subcontractor or person or organization who has been accepted by Corporation and any lenders, unless (i) specifically directed to do so by Corporation, or (ii) the Subcontractor in question has materially breached its S ubcontract. In the event of the termination of any Subcontractor, person or organization, Corporation (and, if deemed necessary by Corporation, any Ienders) wi 11 approve or disapprove the substitute suggested therefor by Construction Contractor prior to Construction Contractor's execution of the applicable Subcontract. Corporation will approve or disapprove, in writing, any such substitution within three (3) business days folI CMti ng receipt of written notification thereof. Any approval by Corporation of such substitution will in no event bedeemed a waiver byCorporation of any rights Corporation may have against Construction Contractor or the terninated Subcontractor. The Construction Contractor will not change a Subcontractor, person or entity previously selected if the Corporationor Architect makesreasonable objection to such change. Subcontractual Relations. By appropriate agreement, written where legally required for validity, the Construction Contractor wi11 require each Subcontractor, to the extent of the Work to be performed bythe Subcontractor, to bebound to the Construction Contractor byterms of the Contract Documents, and assume tONard the Construction Contractor all the obligations and responsibilities which the Construction Contractor, by these documents, assumes tCMtard the Corporation and Architect. Each subcontract agreement will preserve and protect the rights of the Corporation and Architect under the Contract Documents with respect to the Work to be performed by the Subcontractor so that subcontracting thereof wi 11 not prejudice such rights, and wi 11 alI CMt to the Subcontractor, unless specifically provided otherwise in the subcontract agreement, the benefit of all rights, remedies and redress against the Construction Contractor that the Construction Contractor, by the Contract Documents, has against the Corporation. Where appropriate, the Construction Contractor wi 11 require each S ubcontractor to enter i nto si niI ar agreementswith Sub-subcontractors. The Construction Contractor will make available to each proposed Subcontractor, prior to the execution of the subcontract agreement, copies of the Contract Documents to which the Subcontractor wi11 be bound. Subcontractors wi 11 si miI arly make copies of applicable portions of such documentsavai Iable to thei r respectiveproposed S ub-subcontractors. Any part of the Work performed for the Construction Contractor by a Subcontractor will be pursuant to a written Subcontract between the Construction Contractor and such Subcontractor, which wi11 beprepared on a master form of Subcontract which the Construction Contractor has, prior to the execution of any such Subcontract, submitted to the Corporation to insure that each such Subcontractcontai ns provisionsthat

C--23 (1) require that such portion of the Work be performed in accordance with the requirementsof the Contract Documents; (2) require submission to Construction Contractor of applications for payment and clearly defined invoicesand billing supportingall such applications, and such other documentationas Corporation may require, i n reasonable time to enable the Construction Contractor to apply for payment in accordance with the General Conditions; (3) waive all subrogationrights the subcontracting parties may have against one another or that the Subcontractormay have against the Corporationfor damagescaused bytfire or other periIs coveredbyt the propertyinsurance descri bed in the Construction Contract; (4) recognize the rights of the Corporation pursuant to the Contingent Assignment of Subcontracts under the Construction Contract and require the S ubcontractor ( upon notice byt the Corporation that the Corporation has terminated the Corporation-Construction Contractor Agreement with the Construction Contractor pursuant to the Contract Documents, and that the Corporation has elected to retain the Subcontractor pursuant to the terms of its Subcontract with the Construction Contractor) to complete the unperformed obligations under such Subcontractand, if requested bytthe Corporation, to enter into an appropriate agreement evidencing the fact that the Subcontractor is bound to the Corporation under its Subcontract in the manner in which it had been bound to the Construction Contractor; (5) require the Subcontractor to carry and maintain insurance in accordance with the reasonable requirementsof the Construction Contractor; (6) require that all claims for additional costs or extensions of time, with respect to subcontracted portions of the Work will be submitted to the Construction Contractor (via any Subcontractor or Sub-subcontractor where appropriate) in sufficient time so that the Construction Contractor may comply in the manner provided in the Contract Documents for like claims byt the Construction Contractor uponthe Corporation; (7) prohibit Subcontractor from assigning its rights and/or obligations under the Subcontract or from subcontracting the performance of any of its services under the Subcontract except as agreed in writing bytCorporation and Construction Contractor; providedthat no assignment or subcontracting bytthe Subcontractor wi11 relieveSubcontractor of its duties and obi i gations under the agreement; (8) require that Subcontractor's insurance include a waiver of subrogation a severability of interest and a cross-Hability endorsement, nameCorporation and the additional insureds set forth in the Indenture as additional insureds except for Workers Compensation and provide that an act or omission of one of the namedadditional insureds wi 11 not reduce or avoid coverageto another named or additional insured and will afford coverage for all claims based on any act, omission, injury or damagefrom which the claim occurredor arose (or the onset of which occurred or arose) i n whole or in part during the policy period; (9) provide that the Corporation CMtns all drawings, specifications, computations, sketches, test data, surveyresults, models, photographs, renderings and other work productprepared bytthe Subcontractor;

C--24 (10) contain the publicity and confidentiality provisions described in the Construction Contract; ( 11) require submission of Iabor and material Ii en releases and waivers by the Subcontractor for the portion of the Work completed by the, Subcontractor and by such Subcontractor's S ub-subcontractors for which payment has previously been made as a condition to the disbursementof the payment nextdue and CMting; ( 12) preserve and protect therights of the Corporation under the Contract with respect to the Work to beperformed underthe Subcontractso that the subcontracting thereofwi 11 not prejudice such rights; (13) obligate each Subcontractor specifically to consent to the prov1s1ons of this Subparagraph. The Construction Contractor will make available to each proposed Subcontractor, prior to the execution of the Subcontract, copies of the Contract Documents to which the Subcontractorwi 11 bebound bythis Subparagraph. Each Subcontractorwi 11 simi I arly make copies of such Contract Documentsavai I able to its S ub-subcontractors; and (14) contain no provisions inconsistent with any of the foregoing Subparagraphs (1) through ( 1 3). Construction Contractor wi11 furnish to Corporation, from time to time duri ng the term of the Contract, within five (5) days of Corporation's request, a current list of all of its Subcontractors ernploted in connection with the Work with respect to each portion of the Project. Each list will contain the folI CMti ng information: ( 1) The name, address and telephone number of each Subcontractor, including each materials-only vendor under contract with Construction Contractor; (2) The dollar amount of each subcontract and/or Purchase Order Agreement (as applicable), including each materials-onlycontract, entered into byConstruction Contractor; and (3) The amount paid to each Subcontractor, including each materials-only vendor, through the date of each Ii st. Contractor wi11 sign each such Ii st and wi 11 certifythe accuracyof the information set forth in each list. Conduct of the Work

EnvironmentalRequirements. The Construction Contractor will comply with all air and water pollution control rules, regulations, ordinances and statutes which apply to the work performedunder the contract, i ncl udi ng any air pollution control rules, regulations, ordinances and statutes adopted under the authority of Section 11017 of the GovernmentCode. In the absence of anyapplicable ai r polI uti on control rules, regulations, ordinances or statutes governingsolvents, all solvents, including but not linited to the solvent portions of paints, thinners, curing compounds, and liquid asphalt used on the project, will comply with the applicable material

C--25 requirerrEntsof the SanJoaquin ValleyAir Pollution Control District (SJVAPCD). All containers of solvent, paint, thinner, curing compound or liquid asphalt will belabeled to indicate that the contents fully comply with these requi rerrEnts. U nl ess otherwise provided in the special provisions, material to be disposed of wi 11 not be burned either inside or outside the premises. A regular watering programwill beinitiated to adequately control the amountof fugitive dust in accordance with applicable SJ VAPCD rules. Exposed soil surfaces will be sprayed with water at Ieast daily and as needed to rriti gate dust. Trucks hauli ng dirt from the site wi11 becovered in accordance with applicable state and Iocal requirerrEnts. To reduce exhaust errissi ons, unnecessary idi ing of construction vehicles and equi prrEnt wi 11 beavoided. Insurance. Construction Contractor wi11 not comrrEnce any Work under the Contract or deliver any materials to the Project site until it obtains all insurance required to be obtained by Construction Contractor under the Contract and until it has delivered, and Corporationhas approved, the evidence of such insurance described in belCMt. Construction Contractor will not permit any Trade Contractor to commence work on the Project until all insurance requirerrEnts with respect to any such Trade Contractor have also been complied with byany such Trade Contractor. A11 insurance descri bed under this Subparagraph to be carried by Construction Contractor will be maintained byConstruction Contractor, at its expense as a Cost of the Work, with insurance carriers reasonably acceptable to Corporation,Ii censed and approvedto do busi ness in California and having a general policy holders' rating of not less than an "A" and financial rating of not less than "X " i n the most current B est' s Insurance Report. A11 insurance requi red to be carried under this Subparagraph will: (a) include a severability of interest clause; (b) include a cross-Hability clause; (c) provide that coverage provided is primary ( except in the case of an OCIP covering the Project) and is not in excess of or contributing with any insurance or self-insurance maintained by the Corporation and Corporation's consultants; and (d) provide that an act or omission of one of the named or additional insureds will not reduce or avoid coverage to the other narrEd or additional insureds and will afford coverage for all claims based on acts, omissions, injury and damage, which occurred during the policy period. In no event wi 11 such i nsurance be terminated or otherwise allCMted to lapse prior to (i) the earlier of the completion of the Work pursuant to the provisions of the Contract or the termination of the Contract, or (ii) such longer period of tirrEas may be specified in the Construction Contract. Construction Contractor may provide the insurance described in this Subparagraph, in whole or in part, through a policyor policies covering other liabilities and projects of Construction Contractor; provided, hONever, that anysuch policyor policies wi 11: (A) alI ocate to the Project the full amountof insurance required under the Construction Contract; and (B) contain, permit or otherwise unconditionally authorize the wavier contained in this Subparagraph. Corporationwi 11 not berequired to contri bute to the payrrEntof prerriurns or other costs with respect to Construction Contractor's insurance policy(s) except the cost of insurance as provided otherwise bythe Construction Contract. Evidence of Insurance. As evidence of Construction Contractor's specified insurance coverage, Corporation wi 11 accept certificates issued by Construction Contractor' s insurance carrier acceptable to Corporation shCMting such policies in force for the specified period, but Corporation has the right to review and approve certified policies upon notice to Construction Contractor. Such

C--26 evidence will be delivered to Corporation promptly upon execution of the Contract or prior to commencement of Work, whichever earliest occurs. Each policy and certificate will be subject to approval byt Corporation and will provide that such policy will not be subject to reduction in coverage or cancelI ati on without thirty ( 30) days' notice in writing to bedelivered bytregistered mai I to Corporation and any Ienders. Acceptance of certificates of insurance byt Corporation wi11 in no way Ii mi t the Construction Contractor's Iiabi I iti es under the Contract Documents. Should any policy ex.pire or becanceled prior to the earl ier of the completion of the Work pursuant to the provisions of the Contract or the earlier termination of the Contract, and Construction Contractor fai Is immediately to procure other insurance as specified in the Construction Contract, Corporation reserves the right after providingwritten notice to Construction Contractor, but will haveno obligation, to procuresuch insurance for the benefit of Construction Contractor. The cost of any insurance so procured byt Corporation wi 11, at Corporation's option, be paid byt Construction Contractor to Corporation upon demand byt Corporation or be deducted from the GMP. Construction Contractor wi 11 also alI CMt Corporation to inspect such evidence of insurance as Construction Contractor obtains from its Subcontractors, but Corporation will have no obligation to inspect such evidence of insurance. Construction Contractor will not knCMtingly permit any violation of any conditions or terms of the policies of insurance describedin the Construction Contract. Workers' Corrpensation I nsurance. Construction Contractor wi11 maintain, at its expenseas a Cost of the Work, Workers' Compensation Insurance for not Iess than the statutory Iimits, including Employer's Liability (at a minimum limit of One Million Dollars ($1,000,000)) for all persons whom it employs in carrying out the Work under the Contract, including a waiver of subrogation byt the insurance carrier with respect to Corporation. All insurance required under this Subparagraph will be in strict accordance with the requirements of the rrnst current and applicable Workers' CompensationI nsurance Laws in effectfrom time to time at the Project site. Comrercial General Liability Insurance. Construction Contractor will, as a Cost of the Work, maintainCo mmercial General Li abiI i ty nsuranceI on an "occurrence'' basis, with deducti bl es reasonably acceptable to Corporation, with a combined single limit for bodily injury and property damage of not less than Fifteen Million Dollars ($ 15,000,000), covering completed operations, contractual Iiabi Ii ty specifi cal ly covering the indemni fi cation contai ned in the General Conditions, broad form property damage, severability of interest and cross-Hability clauses, operations and premises liability (including elevator liability), independent contractor's protective liability, CMtner's protective liability, products liability, personal injury and explosion, collapse and underground hazards (X,C,U). The limits of liability of the insurance coverage specified in this Subparagraph may providedbe byt any combination of primary and excess liability insurance policies. Construction Contractor wi 11 maintain the insurance described in this Subparagraph for a rrini mum of five (5) years folI CMti ng the completion of the Work and continue to name Corporation and any other required interests under this Subparagraphas additional insured(s) for the five (5) year period. AutormbiIe Liabi Ii ty nsurance.I Construction Contractor wi11 maintain, at its sole cost and expenseas a Cost of the Work, CMtned, hi red and non--{Mfned autorrnbi Ie Iiabi Ii ty insurance coveri ng all use of all autorrnbiles, trucks and other rrntor vehicles utilized byt Construction Contractor in connection with the Contract, with a combined single Ii mit for bodily injury and property damage of not less than Ten Mii lion Dollars ($10,000,000). Additional Insureds. All insurance policies maintained byt Construction Contractor pursuant to this Subparagraph will name Corporation, California State University and its Trustees, California State University Fresno, State of California, and all other parties indemnified under the Construction

C-27 Contract and anyother partyreasonably designated byCorporation as additional insureds (excluding the Architect and Architect's consultants). The interests of the additional insureds, the Construction Contractor Trade Contractors and any S ub-trade contractors and material suppliers i n any insurance proceeds will be subject to the interest of any lenders, and the right of such lenders to apply the proceeds pursuant to the termsof its deed of trust. Fidelity Bond. If required byCorporation, Construction Contractor will, at its sole cost and expenseas a Cost of the Work (subjectto equitable adjustment bythe parties), obtain and maintai n a fidelity bond, or comparable coverage acceptable to Corporation, in an amount not less than One Mi 11 ion Doi Iars ( $1, CXX),CXX)) per occurrence from a surety or insurance company reasonably acceptable to Corporation for any of Construction Contractor's employeeswho may handle funds or propertyin connection with the Project. Costs of Insurance. Any insurance charges which are submitted to Corporation by Construction Contractor, as part of the Cost of the Work under the Construction Contract, will be in arrnunts equal to the ICMtest guaranteed costs then available to Construction Contractor under a fully insured program. Any insurance charges which are submitted to Corporation by Construction Contractor will be subjectto full audit byCorporation. In connection with the OCIP, anyinsurance dividends earned or returned preniurns applicable to the policies required to be carried under the Construction Contract at Corporation's expense wi11 be refunded by Construction Contractor to Corporation immediately uponreceipt thereof. Additional Insurance. The Construction Contractor will provide insurance coverages as a Cost of the Work in accordance with Construction Contractor's corporate program. The Corporation will maintain"All Risk'' Builder's Risk Insurance to the full value of the Project. Deductibles for such Bui Ider' s Risk Insurance wi 11 be no greater than $25,CXX)per occurrence including deductibles arising out of the earthquake peril. This insurance will include interests of the Corporation, the Contractor, Subcontractors and sub-subcontractors in the Project. The Corporation and Contractor waive alI rights against each other and any of thei r subcontractor sub-subcontractors, agents and employees, each of the other. The policies wi11 providesuch waivers of subrogation byendorsement or otherwise. Such Bui Ider' s Risk Insurance wi11 be ntai mai ned, untiI agreed in writing by alI persons and entities who are beneficiaries of such insurance or until final payment has been made. The Construction Contractor will provide Certificates of Insurance evidencing such additional insurance. Darmges. Nothing contained in this Subparagraph is to be construed as limiting the type, quality or quantityof insurance Construction Contractor should maintainfor its CMtnprotection or the extent of Construction Contractor's responsibility for the payment of damages resulting from Construction Contractor's breach nor will anything contained in the Construction Contract be dee!l"Ed to place any responsibilityon Corporationfor ensuring that the insurance required under the Construction Contract is sufficient for the conduct of Construction Contractor' s busi ness or relieve Construction Contractor of any responsibi Ii tyunder the Contract Documents. Perforrmnce Bond and Payrrent Bond. The Construction Contractor will furnish faithful payment and performancebonds in the form attached to the Construction Contract. The Construction Contractor wi 11 ( a) obtain bonds for 1 OCJ>/o of the subcontract price at a mini mum from alI Subcontractorswhose subcontract value is i n excess of $1 00, CXX), wherei n the S ubcontractorsare the principals and the Construction Contractor is the obligee, and (b) at the Corporation's written request, obtain a bond wherein Construction Contractor is the principal and Corporation is the

C--28 obligee. Such bonds will cover the faithful and full performance of the Contract Documents, the payment of alI obi i gati ons arisi ng under the Construction Contract, and, provided that Corporation is not in material default of any payment obligation under the Contract Documents, the lien-free completion of the Work. Upon the request of any person or entity appearing to be a potential beneficiary of bonds covering payment of obligations arising under the Contract, the Construction Contractor will promptly furnish a copyof the bondsor wi11 permita copyto be made. Corporation Controlled Insurance Program (" OCIP Program'). If the Corporation chooses to implement an OCI P Program with respect to the Project, or any portion thereof, at any ti me the terms and conditions thereof wi11 be mutually agreed to by the parties. In the event the parties so agree, Corporation will prepare and Corporation and Construction Contractor will execute an amendmentto the General Conditions on mutually agreeable terms incorporating in the Construction Contract al I of the provisions required by Corporation's OCIP insurer to implement the OCIP Program and Construction Contractor will folION and satisfy all of the safety standards required by Corporation's OCIP insurer. In the event Corporation implements an OCIP Program as provided above, the Contract will be equitably adjusted by the parties including reimbursement of actual insurance costs as agreed to bythe parties. Indemnification. Corporation I ndemnitees. Construction Contractor will indemnify,defend and hold harmless Corporation, its directors, employees, consultants, attorneys and agents (" CorporationI ndemnitees") from any and all claims, losses or damages (hereinafter collectively referred to as "claims'') relating to or arising out of the construction of the Project (the "Original Proceeding") except that Construction Contractor wi11 not beobi i gated to indemnifyCorporation I ndemni tees to the extent the claims are not the result of the negligence, willful nisconduct, or acts or onissions in breach of the Contract Documents of the Construction Contractor or any of those for whom the Construction Contractor is directly or indirectly responsible. The "True U p Proceeding" referred to belON wi 11 be dispositive as to the issue of the extent to which the claims are not the result of the negligence, willful misconduct, or acts or omissions in breach of the Contract Documents of the Construction Contractor or anyof those for whom the Construction Contractor is directly or indi rectly responsibl e. The Construction Contractor's obi i gati on to providea defense to the CorporationI ndemni tees wi11 be in accordance with this Subparagraph. In the event defense is ONedto an I ndernnitee( s) (as this term is defined belON), Indemnitee(s) will be pernitted to select its CMtn attorneys and to control its defense of the Original P roceeding. CSU lndemnitees. To the fullest extent permitted by law, the Construction Contractor will indemnify, defend and hold harmless the Trustees of the California State University, California State University, Fresno and the State of California and all of said entities' employees, consultants, attorneys and agents (" CSU lndemnitees'') from any and all claims relating to or arising out of the construction of the Project (i.e., an Original Proceeding). This obligation of the Construction Contractor to indemnify, defend and hold harniess the CSU Indemnitees from any and all claims relating to or arising out of the construction of the Project will be absolute. The Corporation Indemnitees and the CSU I ndemniteesare collectivelyreferred to as the "Indemnitees ''. Corporation will reimburse Construction Contractor for all costs Construction Contractor incurs in providing indemnification to the CSU Indemnitees to the extent of the CSU I ndemnitees' comparative fault for

C--29 the claimsunderlying the Original Proceeding,as determined at the "True Up Proceeding"referred to belCMt. Secondary Proceeding. As to the CorporationI ndemnitees only, if a claim is asserted against an Corporation Indemni tee(s) and the CorporationI ndemni tee(s) tenders the defense of the claim to the Construction Contractor under this section, the obi i gati on to providea defense to the Corporation lndemnitees, including costs associated therewith, will be absolute, provided, hONever, that if the CorporationI ndemnitee(s) and the CSU Indemnitees or any one of them is primarilyat fault for the claimsunderlying the Original Proceeding, Construction Contractor must providesuch defense to the Corporationlndemnitees unless Construction Contractor promptly seeks a mediation that resultsin either (i) the parties agreeing that Construction Contractor is excused from providing a defense to the Corporation Indernni tee( s), or (ii) the mediator finding that Construction Contractor is excused from providi ng a defense to the Corporation Indemni tee(s) because Indemni tees are pri marily at fault for the clairr(s) or because the claims were at least 75% due to acts beyond either party's control as describedin the Construction Contract. If Construction Contractor seeks such mediation, the issue of Construction Contractor's responsibility to provide a defense to the Corporation lndemnittee(s) will bedeterrri ned in a mediationproceeding under California Evidence Code §1115, et seq. that may occur, at Construction Contractor's election, simultaneously with the Original Proceeding (the "Secondary Proceeding"). The parties agree that the Secondary Proceeding will be conducted in Fresno, California byJAMS ;Endi spute. If at the mediation the parties are unable to mutually agree as to whether Construction Contractor is to be excused from providi ng a defense to Corporation lndemnitee(s), the mediator conducting the Secondary Proceeding will make a finding on the question of whether the Corporationlnde rnniteesand the CSU lndemnitees or anyof them are primarily at fault for the claims underlying the Original Proceeding. In order to determine that the Corporation lndemnitees and the CSU lndemnitees or any of them, are primarily at fault for the claims underlying the Original Proceeding, the mediator must find that the Corporation Indemni tees and CSU lndemnitees, collectively or individually, bear no less than seventy-five percent (75% ) of the comparative fault with respect to the claims underlying the Original Proceeding, or that the clairr(s) were at least 75% due to acts beyondeither party'scontrol as described in the Construction Contract. The finding will be binding on the parties solely for the purpose of determining Construction Contractor's duty to fund a defense for the Corporation lndemnitees in the Original Proceeding. HONever, such finding bythe mediatoris without prejudice to a re-determination at the Secondary Proceeding referred to immediately belON. In the event of a finding that the CSU I ndernnitees are pri marily at fault for the act(s) or omission(s) which gave rise to the claims underlying the Original Proceeding, Construction Contractor will provide a defense in the Original Proceedingfor the CSU I ndemnitees notwithstandingthe foregoing, but wi11 be reimbursed monthly for such defense costs by the Corporation to the extent of the CSU I ndemni tee' s comparative fault as determined in the Secondary Proceeding, which reimbursement payments will not be subject to setoffor deductionnotwi thstandi ng anyother provision of the Construction Contract. Fai I ure of the Corporation to make such payments will result in Construction Contractor withdrawing the defense of the CSU Indemnitees. At the mediation, either party may submit to the mediator, any briefs and/or documents and/or other information that it deems appropriate. The mediator may only consider such briefs, documents and/or other informationthat were submitted to the mediatorand to other partyat least 7 days prior to the Secondary Proceeding. The rules of the California Evidence Code wi 11 not apply to exclude any such briefs, documents or other information from the mediator's consideration. Additionally, neither party will have the right to conduct discovery with respectto the Secondary Proceeding. The Secondary Proceeding will be conducted in accordance with the appropriate rules and procedures of JAMS/ENDISPUTE, including any"fast-track'' rules, except for any such rules and proceduresthat conflict with this Subparagraph If JAMS ;ENDIS PU TE is unable

C-30 or unvvilling to conduct the Secondary Proceeding in accordance with the provisions of this section, then the Secondary Proceeding will be conducted by the American Arbitration Association, in accordance with its rules and proceduresof its Construction IndustryMediation Rules, and any"fast­ track rules', except for any such rules and procedures that conflict with this Subparagraph. If the American Arbitration Association is then unable or unvvilling to conduct the Secondary Proceeding in accordance with the provisions of this Subparagraph, then the parties will by mutual agreement, select a local mediator with at least five years of construction litigation experience to conduct the Secondary Proceeding in accordance with the provisions of this Subparagraph. The costs of the mediator wi 11 be evenly split between the parties. In accordance with California Evidence Code §1119, and in the broadest sense possible, no evidence or information of any sort (whether written, oral, or otherwise) made for the purpose of, or disclosed in the course of, or pursuant to, the Secondary Proceedingis admissible or subject to discovery, and disclosure of such evidence will not be compelled, in any arbitration, administrative adjudication, civil action, or other non-crininal proceeding, in which, pursuant to law, testimony can be compelled to be given. In addition, in accordance with California Evidence Code §1121, in the broadest sense possible, the mediator's fi ndi ngs, comments, reports, recommendations, notations, and alI other relevant information created by the mediator in the Secondary Proceeding, will not be submitted by the mediator or any other person, to any court or other adjudicative body, and a court or other adjudicative body may not consider any report, assessment, inf ormation, evaluation, recommendation, comments, notations, or finding of any kind bythe mediatorconcerning the Secondary Proceeding. "True Up'' Proceeding. The partiesreserve their rights to adjust their liability between them in an additional proceedingto occurafter the final disposition of the Original Proceedingpursuant to the same process as the Secondary Proceeding. At this "True Up''Proceeding, the arbitrator(s) will determine the comparative fault of the Construction Contractor (which will include the Construction Contractor, its Subcontractors, Sub-subcontractors, or those for whom Construction Contractor has direct or indirect responsibility) and the lndemnitees, with respect to all claims that were the subject of the Original Proceeding. Such determination will be final and not subject to appeal. Corporation wi 11 beresponsible to Construction Contractor for any costs incurred byConstruction Contractor as a result of Construction Contractor's providing a defense to the lndemnitees except to the extent of Construction Contractor' s comparative fault as determined at this "True U p Proceeding". Construction Contractor wi 11 be responsible to Corporation for any defense costs incurred by Corporation lndemnitees, or any of them, as a result of Construction Contractor not providing a defense to the Corporation I ndemnitees except to the extent of the comparative fault of the Corporationlndemnitees as determined at this "True Up Proceeding". Construction Contractor will be responsible to Corporation for any costs charged to Corporation as a condition of providing a defense to the CSU I ndemnitees as describedabove, except to the extent of the comparativefault of the CSU lndemnitees as deternined at this "True Up Proceeding". If Corporationwas not required a to make monthly payments to Construction Contractor as a condition of Construction Contractor providing defense to the CSU Indemnitees, then Corporationwi 11 reimburse Construction Contractor for the cost of providing a defense to the CSU Indemnitees to the extent of the CSU I ndemnitees' comparative fault as determined at this "True U p Proceeding". In the event that the Construction Contractor does not pursue a Secondary Proceeding as set forth above, such election by the Construction Contractor wi 11 not constitute a waiver of its rights under this Subparagraph. United Obligation for Bondholder and Bond Trustee Suits. Notwithstanding the foregoing, Construction Contractor has no obligation to providedefense or indemnityin any action initiated by or on behalfof the bondholders or bondtrustee exceptto the extent that the suit seekscosts to repair or replace relevant portions of the Work and then subject to the limitations set forth in the

C-31 Construction Contract. Neither the bondholders nor the bond trustee are thi rd party beneficiaries of the Construction Contract.

Terni nation and Expiration. The indemnity prov1s1ons of the Construction Contract described above will suivive the ternination or expiration of the Contract Documents and will not be Ii mited in any way by the amount or type of insurance.

Construction Contractor's R esponsibi Iity for the Work.

Generally. The Construction Contractor wi11 be responsiblefor al I work performed under the Construction Contract, and no Trade Contractor wi11 be recognized as such. For purposes of assessing responsibility to the Construction Contractor, all persons engaged in the work will be considered employees of the Construction Contractor. The Construction Contractor will give its personal attention to the f ul fi11 ment of the contract and keep al I phases of the work under its control.

The Corporation will not arbitrate disputes among Trade Contractors nor between the Construction Contractor and one or moreTrade Contractors concerning responsibi Ii ty for performing any part of the project.

Quality Control. The Construction Contractor will be fully responsible for the quality of materials and workers' skill in the project. The Construction Contractor will not rely upon the inspection and testing provided by the Corporation other than those special inspections and tests performed by the Corporation's selected Iaboratori es for which there are written reports.

Burden for Darmge. From the issuance of the Notice to Proceed unti I the formal acceptance of the project by the Corporation, the Construction Contractor will have the charge and care of and will bear the risk of damage to the project and materials and equipment for the Project.

The Construction Contractor will, promptly rebuild, repair, restore, and make good all such damage to any portion or to al I of the project and materials before the acceptance of the project by the Corporation except for such damage as is proximately caused by acts of the federal government or public enenly' or other causes beyond Construction Contractor's control, as identified in the General Conditions. In case of suspension of Work from any cause whatever, the Construction Contractor will be responsible for all materials, and will properly store them, if necessary, and will provide suitable drainageand erecttemporary structures where necessary.

If the Construction Contractor damages any property belonging to the Corporation, the Corporation may, in addition to other remedies available to the Corporation, retain from the money due to the Construction Contractor an amount sufficient to ensure repair of the damage or an arrnunt to contribute tCMtard repair of the damage only in the event that Construction Contractor faiIs to repair such damage in a timely manner or to the extent insurance does not cover repair of such damage.

Neither the Corporation,California State University, Fresno, State of California, the Trustees of the California State University, nor the officers, employees, representatives, or agents of each of them will be responsible for any damage to the project and materials and equipment for the project except to the extent the damagewas caused by the fault of anyof them or those directly or indirectly under the control of anyof them and is not paidfor out of B ui Ider' s Risk Insurance.

C-32 Protection of Adjoining Facilities. The Construction Contractor will protect adjoining property and nearby buildings, roads, and other facilities and improvements from dust, dirt, debris and other nuisances arising out of Construction Contractor's operations or storing practices. Dust wi 11 be controlI ed by sprinkling or other effective methods acceptable to Corporation. An erosion and sedimentation control program will be initiated, which includes measures addressing erosion caused by wind and water and sediment in runoff from site. A regular watering program wi 11 be initiated to adequately control the amount of fugitive dust in accordance with applicable SJ VAPCD rules. Sa fety. The Construction Contractor wi 11 exercise precaution at alI ti mesfor the protection of persons and their property. The Construction Contractor will install adequate safety guards and protective devices for all equipment and machinery, whether used in the work or permanently installed as part of the project. The Construction Contractor will also provide and adequately maintai n alI proper temporary walks, roads, guards, raiIi ngs, Ii ghts, and warning signs. The Construction Contractor wi11 comply with alI applicable laws relating to safety precautions, including the safety regulations of the California Division of Industrial Safety. Unless the Construction Contractor designates other employees, its superintendent will have the duty of prevention of accidents. The Construction Contractor will institute a safety program which includes all trades on the site. Renovation, expansion, or remodel work of any existing buiI ding may expose workers to lead-containing materialssuch as paint, flashings, and pipe joints. The Construction Contractor will comply with alI applicable Iaws addressing such exposure, including the Cal !JSHA Lead in Construction Standards (Title 8, California Codeof Regulations, Section 1532.1). The Corporationand the Architectmay bring to the attention of the Construction Contractor a possible hazardous situation in the field regarding the safety of personnel on the site. The Construction Contractor will beresponsible for verifyingthat all local, state, and federal workplace safety guidelines are beingobserved. In no case wi11 this right to notify the Construction Contractor absolve the Construction Contractor of its responsibility for monitoring safety conditions. Such notification will not imply that anyone other than the Construction Contractor has assumed any responsibi Ii tyfor field safety operations. Explosives will not be used without first obtaining written permission from the Corporation and then will be used only with the utmost care and within the linitations set in the written permission and in accordance with prudence and safety standards required by law. Storage of explosives on the project site or University is prohibited. PONder activated tools are not explosive for purposes of the Construction Contract; hONever, such tools will only be used in conformance with State safetyregulations. In the event of an accident, the Construction Contractor wi11 make avaiI able to the Corporation copies of its accident report to its insurance carrier. The Construction Contractor will determine the cause of the accident and i mmediately correct any equipment, procedure, or condition contributing to the accident. In the event the Construction Contractor encounters on the site material reasonably believed to be a Hazardous Material, as that term is defined belON, which has not been rendered harmless, the Construction Contractor will immediately stop Work in the area affected and report the condition to the Corporation and Architect in writing. The Work in the affected area will not thereafter be

C-33 resumed except by written agreement of the Corporation and Construction Contractor if in fact the material is a Hazardous Material and has not been rendered harmless. The Work i n the affected area will be resumed in the absence of a Hazardous Material, or when it has been rendered harmless by written agreement of the Corporation and Construction Contractor. Should Construction Contractor or its Subcontractorsdischarge, release or disposeof any Hazardous Material on the Site in violation of this paragraph. Construction Contractor wi 11 immediatelyso inform Corporationin writing. In the event Construction Contractor or its Subcontractors encounter on the site any pipeline, underground storage tank or other container, of any kind, that may contain Hazardous Material, or encounter material reasonably believed to be a Hazardous Material, Construction Contractor will immediately stop work in the area affected and report the condition to Corporation in writing. If Construction Contractor or his subcontractors do not comply with the requirements of this paragraph Corporation may, but is not obligated to, give written notice of violation to Construction Contractor. Should Construction Contractor or his Subcontractors fail to comply with the requirements of this paragraph within 24 hours from the timeCorporation issues such written notice of noncompliance or within the time of an abatement period specified by any governmental agency, whichever period is shorter, Construction Contractor wi 11 bein materialdefault of the Contract. The Construction Contractor will not be required to perform without its consent any Work relating to Hazardous Materials. Construction Contractor and his S ubcontractors wi 11 use, handle, transport and dispose of alI Hazardous M aterial s i n compliance with al I federal, state and Iocal environmental, health or safety law, including, but not limited to al such statutes, regulations, rules, ordinances, codes, and rules of common Iaw in effect at the ti me of execution of the Contract or which become effectiveat anyti me prior to the expiration of the term of the Contract. Construction Contractor further agrees that Construction Contractor and his Subcontractors will not cause the discharge, release or disposal of any Hazardous Material on the job-site. Construction Contractor and his S ubcontractors wi11 upon completion of performance of alI duties under the Construction Contract, remove from the job site all supplies, materials and waste containing any Hazardous Material which Construction Contractor, any Subcontractor or any other party for which Construction Contractor or anySubcontractor is responsible brought, generated, released, discharged or disposed of on the job site. Construction Contractor will bear full financial responsibility, as between the parties of the Construction Contract, for the compliance of Construction Contractor and his Subcontractors with the provisions of this paragraph. To the fullest extent permitted by law, Construction Contractor will indemnify, defend (pursuant to the terms of the Construction Contract), protect and hold harm ess Corporation and the other Indemni ties from and against any Ii abiIi ti es, costs, claims, damages, fines, penalties or expenses, including actual attorneys' fees and costs of i nvestigati on, soiIs testi ng, governmental approvals, remediation and clean-up ( col Iectively, "Liabilities'') arising out of or in any way connected with the failure of Construction Contractor or his Subcontractors, their agents, employees, officers, or representatives, to comply with this paragraph. Notwithstandingany provisionsto the contrary contained in this Paragraph, Construction Contractor will not berequired to indemnify, defend or hold Corporationand its constituent partners and the other I ndemni ties harmless from Li abi Ii ties with respect to Hazardous Materials that exist as of the date of the Contract on, under or at the Project site (a "Pre-existingCondition") (except to the extent that such Pre-existing Condition is caused, aggravatedor contributed to bythe act or omission of Construction Contractor and /or its employees, agents, S ubcontractors, S ub-subcontractors or any other partyfor which Construction Contractor is responsibl e) . Utilities. If the Construction Contractor discovers utility facilities not identified in the Contract Documents, the Construction Contractor will immediately notify the Corporation and the utility involved, in writing, of such discovery. When the Construction Contractor is required by the

C-34 pl ans and specifications to Iocate, rerrnve or relocate utiIi ty faciIi ti es not identified i n the contract docu!l"Ents with reasonable accuracy, it wi 11 be compensated for any reasonable actual added cost incurred. The Construction Contractor wi11 also becompensated for the cost of repairing anydamage resulting from the discovery of such unidentified utility facility when such damage doesnot result from the faiI ure of the Construction Contractor to exercise reasonable care. A11 such compensation to the Construction Contractor wi 11 be based on the actual cost pl us the Construction Contractor' s fee. The Corporationor the public utility, where it is the CMtnerof the utility facilities, will have the sole discretion to perform repairs, or relocation work or pernit the Construction Contractor to do such repairs or relocation work at a reasonable price, where such work is required to facilitate the project. The Construction Contractor will not be assessed liquidated damages for delay in the completion of the project which is caused bythe faiI ure of the Corporationor the CMtnerof the utiIi ty to providefor removalor relocationof such unidentified utilityfa cilities. With the exception of the identification of main or trunk line utility facilities in the contract docu!l"Ents, the foregoing provisions wi11 not apply to, and Corporation wi 11 have no obi i gati on to indicate, the presence of existing service laterals or appurtenances whenever the presence of such utiIi ti es on the site of the project can be nfi erred from the presence of other visi bl e faciIi ti es, such as buiI di ngs, ll"Eterand junction boxes, on or adjacent to the site of the construction. Except as expressly provided above, the Construction Contractor will be responsible at its CMtn cost for alI work, expense, or special precautions caused by the existence or proxini ty of utilities encountered at the site or in the performance of the project work including, without limitation, repair of any damage that may result including any damage resulting from hand or exploratoryexcavation. The Construction Contractor is cautioned that the utilities encountered at the site may include communication cables or electrical cables conducting high voltage. When excavating in the vicinity of the ducts enclosing such cables, special precautions are to be observed by the Construction Contractor at his CMtn cost and will include the follCMting: all cables and their enclosure ducts will be exposed by careful hand excavation so as not to damage the ducts or cables nor cause inj ury to persons, and appropriate warning signs, barricades, and safety devices wi11 be erected. The Construction Contractor will provide as-built drawings of all utilities encountered and constructed to the Corporation, indi cati ng the size, horizontal Iocati on, and vertical Iocati on basedon the project benchmarkor a stable datum. Asbestos. The Construction Contractor is prohibited from installing any asbestos-containing materials or products in any work to be performed under the Construction Contract. The Construction Contractor wi 11 be responsible for rerrnval and replace!l"Ent costs should it be determined this provisionhas beenviolated. Lead. The Construction Contractor is prohibited from installing any lead-containing materials or products, including paint, in any work to be perfor!l"Ed under the Construction Contract without the written consent of the Corporation's A dnini strator and U niversi ty Di rector of Environ!l"Ental Health and Safety. The Construction Contractor will be responsible for rerrnvaland replace!l"Ent costs should it bedetermined this provision has beenviolated. Pay!l"Ents by Construction Contractor. In accordance with Section 7108.5 of the Business and Professions Code, the Construction Contractor agrees to promptly pay all Trade Contractors within ten ( 10) days of recei pt of each progress payll"Ent, uni ess otherwise agreed in writing by the

C-35 parties, the respective arrnunts allONed Construction Contractor on account of the work performed by its Trade Contractors, to the extent of each such Trade Contractor's interest therein, less any arrnunt ConstructionContractor may lawfully withhold in the event of a bone fide dispute with said Trade Contractor.

The Construction Contractor will pay and will require its Trade Contractors to pay each employee engaged in work on the project under the Construction Contract in full (less deductions made mandatory by aw)I not Iess often than once each week.

Resoonsibilitv to Secure and Pay for Permits. Licenses. Utility Connections. Etc. The Corporation wi11 secure al I pernits and Ii censes required for any operations required under the Construction Contract and wi11 pay al I costs relating thereto as wel I as al I other fees and charges that are required by the United States, the State, the county, the city, a public utility, telephone company, special district, or quasi-governmental entity. The Construction Contractor wi II assist the Corporation in ascertaining the necessity of such permits and licenses. The Construction Contractor wi11 be responsiblefor the procurement of al I trade contractor permits.

Patented or Copyrighted Materials. The Construction Contractor will assumeall costs arising from the use of patented or copytrighted materials, equi pment, devices, or processes used on or incorporated in the project and agrees to save harni ess, defend, and indemnifythe State, the Trustees of the California State University, the Corporation, California State University, Fresno, Corporation's' Consultants, and the officers, agents and employees of each of them from all suits, actions, or claims for, or on account of, the use of any patented or copytrighted materials, equipment, devices, or processes unless such materials, equipment, devices, or processes are required by the Corporation.

Prooertv Rights in Materials and Equipment. Nothing in the contract will be construed as vesting in the Construction Contractor any property right in the materials or equipment after they have been attached to or permanently pl aced i n or upon the work or the soi I or after payment has been made for fifty percent or rrnre of the value of the materials or equipment delivered to the site of the work whether or not they have been so attached or pl aced. A11 such materials or equipment wi11 become the property of Corporation upon being so attached or placed or upon payment of fifty percent or rrnre of the value of the materials or equipment delivered on the site but not yet installed and the Construction Contractor warrants that al I such property wi11 pass to Corporation free and clear of all liens, claims, security interests, or encumbrances.

Taxes. The Construction Contractor wi11 pay al I taxes imposed by aw I which are Ievi ed or become payable as a result of the Construction Contractor's performance under the Construction Contract.

Contract Time. Time is of the essence in achieving the Substantial Completion Date of the Contract. As stated in the Construction Contract, the terms "S ubstanti al Campi etion Date" wi11 be deemed to include "Early Substantial Completion Date''.

Starting and Corrpletion Date. The Construction Contractor agrees to Substantially Complete the Work by the Substantial Completion date unless such time is adjusted, in writing, by change order by the Corporation. The Construction Contractor may complete the Work before the Substantial Completion Date if it will not interfere with the Corporation or its other contractors

C-36 engaged in related or adjacent work. The Work will be regarded as completed as noted on the Corporation's recordation of a Notice of Completion.

Adjustrrent of the Contract Due to Events beyond the Parties' Control. The Construction Contractor will not be assessed with liquidated damages, nor will the Construction Contractor be Iiable for any other type of damage or Ioss of i ncl udi ng, but not Iini ted to, the cost of engi neeri ng and inspection, during any delay in the completion of the Project for events set forth belCMt. The Construction Contractor will notify the Architect and the Corporation in writing of the causes of del� within 20 days from the date it recognized or should have recognized the del� exercising the Standard of Care. The Architect, in conjunction with the Corporation, will determine the facts with regard to the delay and the reasonable period of time by which the date of cornpleti on should be extended by reason thereof, if any, and advise the Corporation. Further, Construction Contractor will be entiti ed to payment of a GMP increase adjustmentequal to the incremental direct additional costs it incurs (including costs of Subcontractors) as a result of any del� under this provision. Construction Contractor will not hONever have any claim for home office overhead or for fees otherwise attributable to such increased direct costs. S uch events are described as:

(1) Any earthquake, hurricane, or other natural disaster; any fi re or other physical destruction or damage, including Iightni ng, explosion, drought, rain, fl ood, storm, or action of the elements at any site of manufacture of any part of the Work or affecting anypart of the Work while in transit to the S ite; or

(2) Disruption in supply of labor, materials, supplies, parts or equipment resulting from strikes, lJo{cotts, Iabor disputes or Iike col Iective, obstructive actions by empl 0ytees or Iabor organizations; or

( 3) U nusual material delay in deliveries applicable to Ii ke contractors generally, casualties not caused (in whole or in part) by Construction Contractor or any Subcontractor or any other party for whom Construction Contractor is responsible pursuant to the Contract Documents or other delays wholly beyondConstruction Contractor's control, provided that Construction Contractor has exercised reasonable efforts to mitigate such delays and has taken reasonable actions to reduce the number and extent of such delays.

(4) Adverse weather conditions unless the number of adverse weather days exceeds the number which is the average number of days of ad verse weather for the prior ten year period i n the area of the Project ("excess adverse weather days") and the Contractor can demonstrate that the numberof excess adverse weather d�s affectthe critical path.

(5) Any epidemic, blockade, rebellion, war, riot, act of sabotage or civil commotion or terrorism or other si ni Iar civiI unrest.

(6) Discovery at or near the site of any species listed as threatened or endangered under the federal or state endangered species act (Construction Contractor acknCMtledges that the Corporation has in its possession a certified Envi ronrrental Impact Report dated November 1999 which indicates "that the proposed project site does not support endangered, threatened or rare species or their respective habitats."); or

(7) Any lawsuit seeking to restrain, enjoin, challenge or delay construction of the Project or the granting or ren01Val of anygovernment al approval; or

C-37 ( 8) Any interruption in any utiIi ty or any faiI ure of any muni ci pal, state or federal infrastructure. The above provisions wi11 be interpreted and applied broadly by the parties to the Construction Contract or any dispositive body called uponto resolve any dispute in connection with this provision Adjustrrent to the Contract Due to Acts of the Corporation or the Architect. If the Construction Contractor is delayed in compl eti ng the contract byreason of anyact or omission of the Architect or the Corporation or those for whom either is directly or indirectly responsible, or by reason of changes ma.depursuant to the Construction Contract without agreement being reachedas to any ti me adjustments, the time for completion of the contract rna.y be extended for a period commensurate with the delay. The Construction Contractor will notify the Architect and the Corporation in writing of the causes of delay within 20 days from the date it recognized or should have recognized the delay exercising the Standard of Care (except for errors and omissions in the Contract Documents which will be submitted pursuant to applicable provisions of the General Conditions). Further, the Construction Contractor wi11 be entiti ed to a GM P increase adjustment equalto the incrementaldirect additional costs it incurs as a result of any delay under this provision. The Construction Contractor will provide to Corporation and Architect a written estirna.te of the probable effect of such delay on the progress of the Work. The Contract Time with respect to the applicable portionof the Project wi11 beextended for a delay if Construction Contractor demonstrates that alI of the folI CMti ng conditions are rret: (1) Condition Number One: The delay is not concurrent with a delay that iscaused by Construction Contractor, Subcontractors or those for whom the CM \G C is directly or indirectly responsible(i.e., the delay is solely an Corporation-c aused delay). (2) Condition Number Two: The delay is critical. A delay is critical if and only to the extent it delays a Work activity that is on the "critical path." A Work activity is on the "critical path" if it cannot be delayed without delaying S ubstantial Campi eti on of the Project beyondthe Iast day of the Contract Time for the entire Project. Under this Subparagraph: (A) If the construction schedule shCMts Substantial Completion of the entire Project or the applicable portion of the Project before the last day of the Contract Time, a delay is critical if and only to the extent the delay pushes Substantial Completion of the Project or the applicable Portion of the Project to a date that is beyond the date of Substantial Completion for the Project specified in the Contract Schedule. ( B) When twoor moredelays occurconcurrently, and each such concurrent delay by itself without consideration of the other delays would be critical, then all such concurrent delays will be considered critical. For the purpose of determining whether and to what extent the Contract Time should be adjusted such concurrent critical delays will be treated as a single delay which commences at the start of the delay that begins first and terminates at the cessation of the delay that ends last. (3) Condition NumberThree: The delay is supported by the Contract Schedule, current at the comrrencement of the event giving rise to the delay. A delay is supported only to the extent the Contract Schedule corroborates that it causes a delay to Substantial Completion of the Project becauseof its effect on the operation.

C-38 (4) Condition Number Four: Within twenty (20) days after the date the Construction Contractor first becomesaware of the delay, the Construction Contractor gives written notice of the del � to the Architect and to Corporation. (5) Condition Number Five: The delay is not caused solely by the financial inability, negligence, nisconduct or default of the Construction Contractor, a Subcontractoror supplier. Examplesof such Corporationdelays, includes, but are not limited to: Subject to applicable provisions of the Construction Contract, the Corporation's decision to change the scope of the Work where such decision is not the result of any default negIi gence or misconduct of the Construction Contractor and where Construction Contractor notifies Corporation in writing that such decision will cause adel�; or The Corporation's decision to suspend the Work where such decision is not the result of any default, negligence, or misconduct of the Construction Contractor. If a delay meets all conditions prescribed in this Subparagraph, then the Contract Time with respect to the Project will be extended by the number of calendar d�s completion of the applicable portionof the Projectis delayed beyondthe Iast d� of the Contract Ti me. If for any reason one or moreof the conditions prescribed in this S ubparagraph is held Iegal ly unenforceable, then all remaining conditions must be met as a condition to obtaining an extension of the Contract Time under the Construction Contract. Construction Schedule. The Construction Contractor will prepare and subnit to the Corporation with copy to the Architect and the Corporation'sAdministrator's on-site representative the Construction Contractor's Construction Schedule within 10 calendar days after the Commencement Date in the Notice to Proceed. The Construction Contractor's Construction Schedule will be comprised of a Critical Path Method network. The Construction Contractor's Construction Schedule wi11 shCMtthe dates on which each partor division of the work is expected to be started and completed, and will shCMt all submittals associated with each work activity, allCMting thirty (30) calendar days (or such lesser time as reasonably required to meet the Construction Schedule) for the Architect's review of each submittal unless a longer period of time is specified elsewhere in these contract documents. The work activities making up the schedule will be of sufficient detaiI to assure that adequate planning has beendone for properexecution of the work and such that, in the sole judgmentof the Corporation, it providesan appropriate basis for monitoringand evaluating the progress of the work. The schedule will shCMt the interdependence of each activity and a critical path. The Construction Contractor wi11 al so subni t a separateprogress schedule Ii sting all submittals required under the contract and when it is anticipated that each submittal will be submitted. The Construction Contractor's Construction Schedule will shCMt the sequence, duration in calendar days, and interdependence of activities required for the complete performance of alI work. The Construction Contractor' s Construction Schedulewi 11 begin with the effective date of the Notice to Proceedand conclude with the date of fi nal completion. The Construction Contractor may submit an Construction Schedule which shCMts the work completedin Iess time than the Contract Time. HCMtever, the acceptance of such a schedule wi11 not

C-39 change the contract time. The contract ti me wi11 control in anydetermi nation of Ii qui dated darrages or extension of the contract time. Float, slack time, or contingency within the schedule (i.e., the difference in time between the project's early completion date and the required contract completion date), and total float within the overall schedule, is not for the exclusive use of either the Corporation or the Construction Contractor, but is jointly CMtned by both and is a resource available to and shared by bothparties as neededto meet contract ni Iestones and the contract completion date.

The Construction Contractor wi11 not sequester shared fl oat through such strategies as extending activity duration estirrates to consume available float, using preferential logic, or using extensive crewfres ource sequencing, etc. Si nee fl oat time within the schedule is jointly CMtned, no ti me extensions wi11 be granted nor delay darrages attributable to the Construction Contractor unti I a delay occurs which extends the work beyond the contract completion date. Since float time within the construction schedule is jointly CMtned, it is acknCMtledged that Corporation caused time savings (i.e., critical path subnittals returned in less time than allCMted by the contract, approval of substitution requests and credit changes which result in a sav ings of time to the Construction Contractor, etc.) will be incorporated into the Construction Schedule updates as they are realized.

Comments rm.de by the Corporation on the Construction Contractor's Construction Schedule during reviewwi 11 not relieve the Construction Contractor from compliance with the requirements of the contract documents. The review is only for general conformance with the scheduli ng requirements of the contract documents. Upon the Corporation's request, the Construction Contractor will participate in the review of the Construction Contractor's Construction Schedule submissions (including the original submittal, all update submittals, and any re-submittals). The Corporation rray request the parti cipati on of Trade Contractors in these reviews, as deterni ned necessary by the Corporation. All revisions will be resubnitted within fifteen (15) calendar days after the Corporation's review.

The subnittal of a fully revised and acceptable Construction Contractor's Construction Schedule will be a condition precedent to the processing of the second rronthly payment application, uni ess the Corporation grants a time extension due to unusual ci rcumstances.

The Construction Contractor will subnit to Corporation and Architect a Critical Path Method (CPM) network. The network will provide a workable plan for rronitoring the progress of all the elements of the work, establish and clearly display the critical elements of the work, forecast completion of the construction, and rratch the contract duration in time. Exclusive of those activities for subnittal review and rraterial fabrication and delivery, activity duration will not be less than one (1) or rrore than thirty(30) calendar days, unless otherwise approved by the Corporation. In addition to the detailed network diagram, the Construction Contractor will submit the follCMting reports with the original submittal and all updates and revisions:

(1) PredecessorJSuccessor Report or a list shCMting the predecessor activities and successor activities for each activity in the schedule.

(2) Activity Report sorted by early start or a list shCMting each activity in the schedule, arranged byearly start dates.

Unless the Corporation's Representative in writing each rronth, specifically waives this requirement, an updated construction schedule will be subnitted to the Corporation's Administrator with a copy to the Architect five (5) days prior to the submittal of the Construction Contractor's

C-40 rrnnthly payment request. The submittal of the updated construction schedule which satisfies the requirements of this Paragraph, accurately reflects the status of the work, and incorporates all changes into the schedule, will be a condition precedent to the processing of the rrnnthly payment application. Updated schedules will also be submitted at such other times as the Corporation may direct. If the Construction Contractor fails to comply or is late in compliance with this requirement, and the Corporationfinds it to bein their bestinterest to processthe rrnnthly payment, an arrnunt not exceeding $5,000wi 11 be retained from any rrnnthly progress payment untiI compliance is effected. The withheld arrnunt will be deducted from the contract arrnunt if delinquent for any additional rrnnth. The rrnnthly schedule update will include a report containing a narrative which includes the folI CMti ng: Construction Contractor's Schedule Narrative Report Outline • Construction Contractor's transmittal letter • Descri ption of problem areas (referenced to change order or cl ai m numbers) as appropriate. • Current and anticipateddelays not resolved byapproved change order, including: • Cause of the delay • Corrective action and schedule adjustmentsto correct the delay • KnCMtn or potentialimpact of the delay on other activities, mi Iestones, and project completion date • Changes in construction sequence • Pending itemsand status thereofincluding but not Iimited to: • Pendi ng change orders • Time ext ension requests • Other i terns • Contract completion date status: • If ahead of schedule, the numberof calendar daysahead • If behindschedule, the numberof calendar days behind • Other projector scheduling concerns • U pdatednetwork diagram • Tabular report,including a listing of completed activities and activities in progress. If completion of any part of the work, delivery of equipment or materials, or submission of the Construction Contractor subnittals is behind the updated construction schedule and will impact the end date of the work past the contract completion date (create negative float), the Construction Contractor wi11 submit in writing, a pl an acceptable to the Corporationfor completing the work on or before the current contract completion date. The pl an wi11 take someor alI of the folI CMti ng actions: (1) Increase construction manpCMter in such quantities and crafts as will substantially eliminate the backlogof work and meetthe current Contract completion date. (2) Increase the number of working hours per shift, the number of shifts per day, the numberof work days perweek, or the arrnuntof construction equipment, or any combination of the foregoing sufficientto substantially el ini nate the backlogof work.

C-41 (3) Reschedule work items to achieve concurrent accomplishment of work activities. U nder no ci rcumstanceswi 11 addi ng equipmentor construction forces, increasing the working hours, or employing any other method, rranner, or procedure to return to the contractually required completion date be justification for a change order or justification for a compensable acceleration, unless prior written approvalis received from the Corporation. Once each week, or as approved in writing by the Corporation, the Construction Contractor will submit a report or schedule listing the activities begun, completed, and in progress in the past week, and the activities scheduled to begin, becompleted or bein progressfor the succeedi ng two( 2) weeks. This report will cover all work activities listed on the construction schedule. The report or schedule rray besubmitted in barchart form or i n a schedule narrative document. As a condition precedent to the release of retained funds, the Construction Contractor will, after completion of the work has been achieved, submit a final Construction Contractor's construction schedule which accurately reflects the rrannerin which the project was constructed and includes actual start and completion dates for all work activities on the construction schedule. A rrnre detaiI ed and comprehensive scheduling requirement rray be required by the Corporation. In this case, the schedule requirement wi11 beincluded i n the contract as S uppl ementary General Conditions. Corparation's Right to Perform Construction and to Award Separate Contracts. The Corporation reserves the right to perform construction or operations related to the Project with the Corporation's CMtn forces, and to award separate contracts in connection with other portions of the Project or other construction or operationson the site. HONever, as a condition precedentto any such perforrrance byCorporation's ONn forces and/or award of separate contract, the parties acknONledge that the Corporation must procure the prior written consent of its lender, which consent rray be withheld unless and until the Project's designated Construction rrnnitor certifies that such performance or award will not rraterially and adversely impact the cost, quality or Construction Schedule of the Project. If the Construction Contractor claims that delay or additional cost is involved because of such action by the Corporation, the Construction Contractor will rrake such Claim as providedelsewhere in the Contract Documents. The Corporation will provide for coordination of the activities of the Corporation's CMtn forces and of each separate contractor with the Work of the Construction Contractor, who will cooperate with them. The Construction Contractor will participate with other separate contractors and the Corporation in reviewing their construction pl ans and schedules when directed to do so. Pursuant to the change order provisions of the Construction Contract, the Construction Contractor wi 11 rrake any revisions to the Construction Schedule and GMP deemed necessary after a joint reviewand mutual agreement. The Construction Contractor wi 11 afford the Corporation and separate contractors reasonable opportunity for introduction and storage of their rraterials and equipment and perforrrance of their activities and will connect and coordinatethe Construction Contractor's construction and operations with theirs as required bythe Contract Documents. If part of the Construction Contractor's Work depends for proper execution or results upon construction or operations by the Corporationor a separate contractor, the Construction Contractor wi 11, prior to proceedingwith that portionof the Work promptly reportin writing to the Architect and

C-42 Corporation apparent discrepancies or defects in such other construction that would render it unsuitable for such properexecution and results. Failure of the Construction Contractor to so report wi 11 constitute an acknCMtledgment that the Corporation's or separate contractors' completed or partially completed construction is fit and proper to receive the Construction Contractor's Work except as to defects not then reasonably discoverable. Costs caused byt delays or byt improperly timed activities or defective construction will be bornebyt the partyresponsi bl e therefore. Should the Construction Contractor cause damage to work or property of any S ubcontractor or separate contractor, the Construction Contractor will, upondue notice, promptly attempt to settle such matter or otherwise to resolve the dispute. If such Subcontractor files a lawsuit, initiates a mediation or arbitration proceeding or otherwise makes a claim against the Corporation on account of any damage caused or alI eged to have been caused, i n whole or in part, byt the Construction Contractor, the Corporation will notify the Construction Contractor, who will indemnify and hold harmless the Indemni tees to the extent set forth in the General Conditions The indemnityprovisions containedin the Construction Contract wi 11 surviveterni nation of the Contract Documents. Changes in the Work

Change Orders. Generally. Pursuant to the Construction Contract, the GM P may adjusted be for any change order requiring a different quantity or quality of labor, materials or equipment from that originally required, and the partial payments to the Construction Contractor will be adjusted to reflect the change. Whenever the necessity for a change arises, and when so ordered byt the Corporation in wri ti ng, the Construction Contractor wi11 take alI necessary steps to halt such other work in the area of the change that might be affected byt the ultimate change. Changed work will be performed in accordance with the original contract requirements except as rnx:lified byt the change order. Except as provided in the Construction Contract, the Construction Contractor will have no claim for any other compensationdue to changes in the work. Proposed Change Orders. If Construction Contractor asserts that Construction Contractor is entitledto an adjustmentof the GMP and/or Contract Time as allCMtedbyt the Contract Documents, then Construction Contractor may submit a Change Order Request to the Architect and the Corporation. A Change Order Request must state that it is a Change Order Request, state the reason for the request, and specify the amount of any requested adjustment to the GMP and/or Contract Ti me. Upon request of Architect or the Corporation, Construction Contractor will submit such additional information concerning the Change Order Request as may be requested byt Architect or the Corporation for the purpose of evaluati ng the Change Order Request. S uch additional i nf ormation may include a cost proposal and/or written documentation demonstrating Construction Contractor's alleged entitlement to a time extension under the Construction Contract. If the Change Order Request seeks an adjustment of the GMP for delay, upon request of Corporation's Representative, Construction Contractor will submit written documentation demonstratingConstruction Contractor's alleged entitlementto such an adjustment.

C-43 A condition precedent to obtaining an adjustment of the GMP and/or Contract Time as the result of an act, error, or onission of the Corporation, the Architect, their agents or employees, or as the result of an unforeseen condition, is timely submission of a Change Order Request that meets the requirementsset forth in the General Conditions. A Change Order Request based on such acts, errors or omissions will bedeemed timely subnitted if and only if it is submitted within twenty(2 0) days of the earlier of the date the Construction Contractor discovers, or should have discovered (using its professional standard of care), that an act, error or onission of the Corporation, the Architect, their agents or employees, has occurred that may entitle Construction Contractor to an adjustment of the GMP and/or Contract Time (even if the Construction Contractor has not been damaged, delayed, or incurred extra cost when Construction Contractor discovers, or should have discovered, (using its professional standard of care) the act, error or omission giving rise to the Claim). A Change Order Request based upon an unforeseen condition will be deemed timely submitted if and only if it is submitted within twenty (20) days of the date the Construction Contractor discovers, or should have discovered (using its professional standard of care), the existence of an unforeseen condition that may entitle Construction Contractor to an adjustment of the GM P and/or Contract Time (even if the Construction Contractor has not been damaged, delayed, or incurred extra cost when Construction Contractor discovers, or should have discovered (using its professional standard of care), the unforeseen condition giving rise to the Clain,). With respect to an adjustment based on an error, omission or other deficiencyi n the Contract Documents, Construction Contractor' s 20 day period for submission of notice will commence uponits obtaining actual knCMtledge of such error, onission or deficiency. If Corporation issues a final decision on all or part of a Change Order Request, the Construction Contractor may contest the decision by fi Ii ng a timely CIaim under the procedures specified in the General Conditions. A final decision is any decision on a Change Order Request by Corporation that states that it is final. Subject to the Construction Contract, a failure to reach an agreement with Corporation as to the final value of a Change Order Request, will not relieve Construction Contractor of its obligation to continue the prosecution of the Work diligently at all ti mesin accordance with the current schedule for the Project. GMP will beadjusted for delaysas set forth in the General Conditions. EmergencyChanges. Changes in the work madenecessary due to unforeseen site conditions, discovery of errors in plans or specifications requiring immediate clarification in order to avoid a serious work stoppage, changes of a kind where the extent cannot be determined untiI completed, or under any circumstances whatsoever when deemed necessary by the Corporation are ki nds of emergency changes which may be authorized by the Corporation in wri ti ng to the Construction Contractor. The Construction Contractor will commence performance of the emergency change immediatelyupon receipt of written direction from the Corporation. If agreement is reached as to compensation adjustment for the purpose of any emergency change, then compensationwi 11 beas providedin the provisionsof the Construction Contract relating to ordi nary changes. If agreementis not reached as to compensationat the ti me of commendng the emergency change, then compensation wi 11 be as provided in the Construction Contract; that is, time and materials records and sumrnaries wi 11 be witnessed and maintai ned untiI an adjustment to the GMP is agreed upon, or the changed work is completed. CIaims and Damages

C-44 The initially capitalized term "Claim'' means a written demand or assertion by the Construction Contractor or Corporation seeking an adjustment or interpretation of the terms of the Contract Documents, payment of money, extension of time, or other relief with respect to the Contract Documents, incl uding a determination of disputes or matters in question between Corporation and Construction Contractor arisi ng out of or related to the Contract Documents or the performance of the Work claims alleging an unforeseen condition or an act, or an error or omission by Corporation, Architect, their agents or emplO{ees. HONever, the term "Claim'' will not include, and the Claimsprocedures provided under this Paragraph wi11 not apply to, the fol IONi ng:

(1) Claims respecting penalties for forfeitures prescribed by statute or regulation which a governmentagency is specifically authorized to administer, settle, or determine; and

(2) Claims respecting personal injury, death, reimbursement, or other compensation arising out of or resulting from liability for personal injury or death.

If a Claim is subject to the procedure specified in the Construction Contract relating to Change Order Requests, the Claim arises upon the issuance of a written final decision on the Construction Contractor's Change Order Request. If a Claim is not subject to the procedure relating to Change Order Requests, the Claim arises when the Construction Contractor discovers or should have discovered the conditions or event giving rise to the Claim using the Standard of Care, subject to the exception for deficiencies in the Contract Documents.

A Claim not subject to the procedures relating to Change Order Requests may be asserted if and only if the Construction Contractor gives a written notice of intent to file the Claim as soon as possible (taking into consideration the particular ci rcumstances of the Claim), but i n no event Iater than twenty (20) days, after the date the Claim arises. A written notice of intent to file the Claim must identify the event or condition giving rise to the Claim and state its probableeffect, if any, with respect to the Construction Contractor's entitlement to an adjustment of the GM P and/or the Contract Time.

A CIaim must include the fol IONi ng:

(1) A statement that it is a Claim and a request for a decision.

(2) A detailed description of the act, error, omission unforeseen condition, event or other condition giving rise to the Claim.

(3) If the Claim is subject to the procedures relating to Change Order Requests, a statement demonstrating that a Change Order Request was timely submitted as required by the paragraph relating to such Requests. If the Claim is not subject to the procedures relating to Change Order Requests, a statement demonstrating that a valid notice of intent to fi Ie the Claim was ti mely submitted.

(4) A detai Ied ustij fi cation for any remedy or relief sought by the Claim, including to the extent appli cable, the fol IONi ng:

(A) If the Claim involves Extra Work, a detailed cost breakdONn of the amounts claimed. The breakdONn must be provided even if the costs claimed have not been incurred when the Claim is submitted. To the extent costs have been incurred when the Claim is submitted, the

C-45 Claim must include actual cost records (including, without limitation, payroll records, material and rental invoices and the Ii ke) demonstrating that costs cl ai !l'Ed have actual ly been incurred. To the extent costs have not yet beenincurred at the ti ll'Ethe Claim is submitted, actual cost records must be submitted on a current basisnot less than once a weekduring anyperiod where costs are incurred. A cost record wi 11 beconsidered current if submittedwithin a reasonable period of ti ll'E, but i n no event Iater than thi rty ( 30) calendar days, after the date the cost reflectedin the record is i ncurred. At the request of the Architect, clai!l'Edextra costs may be subject to further verification procedures (such as having an inspectorverify the performanceof alleged extrawork on a daily basis). (B) If the Claim involves an extension of the Contract Till'E, written docu!l'Entationdemonstrating the Construction Contractor's entitlell'Entto a till'Eexte nsion. (C) If the Claim involves an adjustll'Ent of the GMP for delay, written docu!l'Entation demonstratingthe Construction Contractor' s entiti e!l'Entto such an adj ustll'Ent. Claim; for Concealed or U nknCMlrl Conditions. If conditions are encountered at the site which are (1) subsurface or otherwise concealed physical conditions which differ materially from those indicated in the Contract Docu!l'Ents or (2) unknCMtn physical conditions of an unusual nature, which di ff er materially from those ordi nari ly found to exist and generally recognized as inherent in construction activities of the character provided for in the Contract Docu!l'Ents, then notice by the observing party will be given to the other party promptly before conditions are disturbed and in no event later than 21 days after first observance of the conditions. The Architect will promptly investigate such conditions and, if they differ materially and cause an increase or decrease in the Construction Contractor's cost of, or till'E required for, performance of any part of the Work will recom!l'End an equitable adjustll'Ent in the GMP or Contract Till'E, or both. If the Architect determines that the conditions at the site are not materially different from those indicated in the Contract Docu!l'Ents and that no change in the termsof the Contract is justified, the Architect wi 11 so notifythe Corporationand Construction Contractor in writing, stating the reasons. Claims by either party in opposition to such determination must be made within 21 days after the Architect has given written notice of the decision. If the Corporation and Construction Contractor cannot agree on an adjustll'Ent in the GMP or Contract Till'E, the adjustll'Ent will be referred to the Architect for initial determination, subject to further proceedingspursuant to this Paragraph. Continuing Contract Perforrmnce. Notwithstanding the making of any Claim or the existence of any dispute regarding any Clai m, uni ess otherwise directed by the Corporation, the Construction Contractor will not cause any delay, cessation, or ternination in or of the Construction Contractor's performance of the Work but, despite such a Claim, Construction Contractor will diIi gently proceedwith performance of the Work i n accordance with the Contract Docu!l'Ents. Ti ll'ELi nit on Cl ai rn;. The Construction Contractor wi 11 subnit a Claim in writing, together with the supportingdata specifiedin under the Construction Contract, to the Corporationas soon as possible, but not later than thirty(30) calendar days after Construction Contractor delivers the written notice of intent to fi Ie a CIaim under the Construction Contract. All Claims which are not resolved pursuant to this Paragraph will, at the request of either Corporationor Construction Contractor, be submitted to non-binding ll'Ediation. Anyll'Ediation will be conducted in accordance with the rules and requirell'Ents promulgated byJAMS with respect to mediation( the 'JAMS MediationRules") . To the extent theJAM S Mediation Rules conflict with the provisions belCMt relati ng to arbitration, the JAMS Mediation Rules wi 11 control. N otwithstandi ng

C-46 the foregoing, there will beno discoveryinvolved in the rrEdiation. Such rrEdiation will beinitiated by either partywithin twobusiness days after Corporation or Construction Contractor sends written notice of a request to rrEdiate by registered or certified rnai Ito the other party and to jams. The parties wi 11 share the rrEdiator' s fee and anyfi Ii ng fees equally. The rrEdiati on wi 11 beheld in Fresno California, uni ess another Iocati on is mutually agreed upon. Mediator's recomrrEndations issued in rrEdiation will be non-binding. Either party may terminate any such rrEdiation proceedings at any tirrEafter completion of one full day of rrEdiation. All Claims which are not resolved as descrived above, will be subject to and decided by arbitration pursuant to the provisions of this Paragraph, provided that the arrnunt in controversy between the parties, including any cross-claims, does not involve an arrount in excess of Five Hundred Thousand Dollars ($500,000). If the arrnunt in controversy between the parties, including anycross -claims, exceeds Five Hundred Thousand Dollars ($500,000), such dispute will beresolved by a court of competent jurisdiction in California DUE TO THE SPECIALIZED NATURE OF CONSTRUCTION LITIGATION, EACH PARTY WAIVES ITS RIGHT TRIAL BYJU RY. Any Claim to be arbitrated pursuant to the provisions of the Construction Contract will be determined by binding arbitration before a retired judge of the Superior Court of the State of California ( the "Arbitrator'') under the auspices of J udi ci al A rbi trati on & Mediation Services, Inc. (" JAMS"). Such arbitration may be initiated by the parties, or either of them, within ten (10) days after either party sends written notice ( the "Arbi trati on Notice") of a demand to arbitrate by registered or certified maiI to the other party and to JAMS . The A rbitrati on Notice wi11 contain a detailed description of the subject matter of the arbitration, the Claim with respect thereto, the arrnuntinvolved, if any, and the rerrEdy or determination sought. The Construction Contractor and the Corporation mayagree on a retiredjudge from theJAMS panel. In connection with attempting to agree on such a judge, as to any judge considered for selection,each partywi 11 di sci ose in writing to the other party the number of matters wi thin the previous twelve rronths in which that partyor its attorneysparticipated and that judge acted as an arbitrator or refereeor in a similar capacity. If they are unable to promptly agree, JAMS wi 11 providea Ii st of threeavai I able judges and the parties wi11 exchange the sarrE information as to each of these judges. Thereafter, each party may strike one. The rernaining judge (or if there are two, the one selected byJAMS) will serve as the Arbitrator. In the event that JAMS will no longer exist or if JAMS fails or refuses to accept submission of such Claim, then the Claim will be resolved by binding arbitration pursuant to another retired judge reference procedure then existing and agreed to bythe parties, or if none exists or can be agreed to, then the Claim will be resolved by binding arbitration before the ArrEricanArbitration Association ("AAA") under the AAA's construction industry arbitration rules then in effect. The Arbitrator will schedule a pre-hearing conference to resolve procedural matters, arrange for the exchange of information, obtain stipulations and narrCMt the issues. The parties will submit proposed discovery schedules to the Arbitrator at the pre-hearing conference. The scope and duration of discovery will be within the sole discretion of the Arbitrator; provided, hONever, that neither party will be permitted to conduct rrore than five (5) depositions each. The Arbitrator will have the discretion to order a pre-hearing exchange of information by the parties, including, without Iimi tation, production of requested docurrEnts, exchange of summaries of testi rrony of proposed witnesses and examination bydeposition of parties and third-partywitnesses. This discretion wi 11 be exercisedin favorof discoveryreasonable under the circumstances. The arbitration will be conducted in Fresno, California Any party may be represented by counsel or other authorized representative. In rendering a decision( s), the Arbitrator wi11 determine

C-47 the rights and obi igati ons of the parties according to the substantive and procedural'iNVs I of California and the terms and provisions of the Contract. The Arbitrator's decision will be based on the evidence i ntroduced at the hearing, including alI Iogi cal and reasonable inferences therefrom. The Arbitrator may make any determination and/or grant any remedy or relief that is just and equitable up to a total arrnunt not to exceed $500,CXX). The decision must be based on, and accompanied by, a written statell"Ent of decision expl ai ni ng the factual and Iegal basis for the decision as to each of the pri nci pal controvertedissues. The decision wi11 beconclusive and bi ndi ng, and it may thereafter be confirmed as a judgment by the Superior Court of the State of California, subject only to challenge on the grounds set forth in California Code of Civil Procedure Section 1286.2. The validity and enforceability of the Arbitrator's decision is to be determined exclusively by the California courts pursuant to the provisions of the Contract. The Arbitrator may 'iNVard costs, including, without linitation, attorneys' fees, and expert and witness costs, to the prevaiIi ng party, if any, as determined bythe Arbitrator in his or her discretion. The Arbitrator' s fees and costs will be paid by the non-prevailing party as determined by the Arbitrator in his or her discretion. A party wi11 be determined by the Arbitrator to be the prevaiI i ng party if i n the exercise of the Arbitrator' s reasonable discretion, he or she fi nds that the party's proposal for the resolution of the CIaim is the closer to that adopted bythe Arbitrator. Delay in Campi eti on -Liqui dated Damages. A final credit change order wi 11 beexecuted to assess liquidated damages, if any, in accordance with applicable provisions of the Construction Contract between the parties. If the Construction Contractor faiIs to pay such Ii quidated damages, the Corporation may deduct the amount thereof from any money due or that may become due the Construction Contractor under the Construction Contract. Failure to Meet Terms of Contract. If the Corporation deems that the Construction Contractor has faiI ed to supply an adequate working force, or materialof properquality, or has faiI ed in any other respect to prosecute the work with the diligence and force specified in the contract, it will provide Construction Contractor with written notice of the alleged deficiencies with detailed descriptions. If Construction Contractor has not undertaken to re!l"Edy such alI eged deficiencies, within 1 0 days thereafter uponan additional 1 0 days written notice, Corporation maytake any action permitted byl'iNV to remedy such failure, including but not linited to completing such work with its CMtn forces and/or by retention of another contractor. In such event, Corporation will be entitled to reimburse!l"Ent for any additional expenses i ncurred by it by virtue of Construction Contractor' s failure to so perform. The Construction Contractor's failure to complete a punch list with diligence is an example of such faiI ure to meet the termsof the contract. Payment and Completion

Acceptance. When the Project has been completed in all respects in accordance with the plans and specifications, to the full satisfaction of the Corporation, a Notice of Completion will then be immediately filed by the Corporation with the County Recorder for Fresno County. The date of acceptance of the project as stated on the Notice of Completion will be the official completion date relating to Ii quidated damages. The County Recorder' s date of recording on the Notice of Completion, if filed timely (within ten days of acceptance), will be the official completion date relating to stop notices and/or mechanic's liens. In addition to the till"E requirell"Ents of this paragraph, all claims arising from the Construction Contract will be submitted in writing to the Corporationno Iater than 30 calendar days after the recordation date on the Corporation's Notice of Completion. If the Corporation prefers to accept Work that is not in accordance with the requirell"Entsof the Contract Documents,the Corporation maydo so instead of requiring its rern::wal

C-48 and correction, in which case the GMP will be reduced as appropriate and equitable. Such adjustment wi11 be effected whether or not final paymenthas been made.

Guarantee. The Construction Contractor warrants to the Corporation and Architect that materials and equipment furnished under the Contract will be of good quality and new unless otherwise expressly required or permitted by the Contract Documents, that the Work wi11 be free from defects not inherent i n the quality required or perni tted, and that the Work wi11 conform to the requirements of the Contract Documents. Work not conforming to al I of the foregoing requi rements, including substitutions not properly approved and authorized, will, unless the Corporation expressly elects to the contrary, be considered defective (" Defective Work''). The Construction Contractor's warranty excludes remedy for damage or defect caused by abuse, modifications not executed by the Construction Contractor, improper or insufficient maintenance, improper operation, or normal wear and tear under normal usage. If required by the Architect or the Corporation, the Construction Contractor will furnish satisfactory evidence as to the kind and quality of materials and equipment.

Construction Contractor guarantees al I Work for a period of one (I) year from the date of Substantial Completion of the Work with respect to each Portion of the Project, unless such longer period of ti me is agreed upon in writing byCorporation and Construction Contractor ( the "Guarantee to Repair Period"). As part of such guaranty and during the Guarantee to Repair Period, Construction Contractor agrees to (a) correct all Defective Work and (b) replace, repair, or restore to the Corporation's satisfaction any other parts of the Work and any other real or personal property which is damaged or destroyed as a result of DefectiveWo rk or the correction of Defective Work. Construction Contractor wi11 commencerepair or replacement of anydefective material or equipment and performance of any labor necessary to correct any Defective Work as promptly as possible taki ng into consideration the particular circumstances surrounding the Defective Work but in no event Iater than thi rty 30)( days, after receipt of written notice thereof from the Architect or the Corporation, and wi11 thereafter di Iigently prosecute al I such corrective work to completion. Construction Contractor will undertake commencement to correct Defective Work within 5 days after recei pt of written notice thereof, if the defect is i nhi bi ti ng anyrevenue generati ng portion of the Project or the Corporation's ability to use the Project for the purpose for which it is intended. The Construction Contractor will bear all costs without reimbursement from Corporation, except to the extent available as a Cost of the Work of such correction, replacement, repair, or restoration and all Losses resulting from such Defective Work including additional costs for testing, inspection, and compensation for the Architect' s services and expenses. The Construction Contractor wi11 perform corrective Work at such times that are acceptable to the Corporation and in such a manner as to avoid, to the extent practicable, disruption to the Corporation's activities. The Construction Contractor will remove from the Project site portions of the Work and materials which are not in accordance with the Contract Documents and which are neither corrected by the Construction Contractor nor accepted by the Corporation.

Construction Contractor wi11 be responsible for notifying al I applicable manufacturers, before the Iapse of any applicable warranty period, of any manufacturing defects in any of the Work or materials included in the Project; provided, hONever, that Construction Contractor will be required to give such notice only with respect to those defects of which Construction Contractor has knONledge or should have discovered using the Standard of Care (subject to the exception for errors and omissions in the Contract Documents) in the performance of the Work pursuant to the provisions of the Contract. Upon Substantial Completion, Construction Contractor will assign to the Corporation al I manufacturer' s warranties and other warranties required under the Contract Documents and

C-49 Construction Contractor wi 11 be responsible for enforcing any and alI warranties given by Subcontractorsduring the Guaranteeto RepairPeriod. In the event Construction Contractor fails to promptly, diligently and effectively perform its obligations under this Subparagraph, Corporation may, at its option, furnish or secure such materials and Iabor as are necessary to correct any such defect, and alI direct and i ndirect costs thereof incl udi ng, without Iimi tation, an amount of ten percent ( 1 QJ/o ) in excess of such costs for Corporation's overhead and compensation for additional professional services, will be borne solely by Construction Contractor and wi11 be due and payable to Corporation by Construction Contractor within ten (10) days after written demand therefor. In addition, Corporation may remove the Defective Work and store salvageable materials and equipment at the Construction Contractor's expense. If the Construction Contractor fails to paythe costs of such removaland storage within ten (10) days after written demand by Corporation, the Corporation may, without prejudice to other remedies, sell such materialsat auction or at private sale, or otherwise dispose of such material. The Construction Contractor will beentitled to the proceedsof such sale, if any,in excessof the costs and damages for which the Construction Contractor is Iiable to the Corporation, including reasonable attorneys' fees and expenses and compensation for the Architect's services and expenses. If such proceeds of sale do not cover costs and damages for which the Construction Contractor is Iiable to the Corporation, the GM P wi 11 be reduced bysuch deficiency. If there are no remaini ng payments due the Construction Contractor or the remaining payments are insufficient to cover such deficiency, the Construction Contractor wi11 promptly pay the differenceto the Corporation. Subject to the linitations set forth in the Contract Documents, Corporation mayassert claims for damages resulting from latent defects in the Work or Construction Contractor's failure to complete the Work in accordance with the Contract Documents, for the period of linitations prescribed or allONed by law. The Construction Contractor will secure and deliver to the Corporation written warranties and guarantees from alI Subcontractors, S ub-subcontractors and suppliers bearing the date of Substantial Completion of the Project, together with assignments thereof, if necessary, and delivery of such will be a condition precedent to final payment. Notwithstanding anything in the Construction Contract to the contrary, Construction Contractor will use its best efforts to secure warranties from manufacturers, which warranties extend beyond one ( 1) year from the date of Substantial Completion of the entire Project as a whole. The Construction Contractor's obligations under this Subparagraph are in addition to and not in limitation of any other obligation of the Construction Contractor under the Contract Documents. Enforcement of the Construction Contractor' s warranties and guarantees to repair contai ned in the Contract Documents will be in addition to and not in limitation of any other rights or remedies to which the Corporation may be entitled under the Contract Documents and under applicable law, including those concerning defects. Establishment of the Guarantee to Repair Period relates only to the specificobi i gati on of the Construction Contractor to correct the Work and in no way Ii mi ts either the Construction Contractor's liability for defective work or the timewithin which proceedings may be commenced to enforce the Construction Contractor's obligations under the Contract Documents. The Construction Contractor' s obi i gati ons under this S ubparagraph wi 11 survive any termination of the Contract Documents. Terni nation and Suspensi on of Work. Notwi thstandi ng anythingto the contrary set forth in the Construction Contract, Corporation will have the right at any time for any or no reason whatsoever to suspend the Work or any portion thereof or to terminate the Contract upon giving Construction Contractor ten ( 10) days' prior written notice. U pon termi nation as the Construction

C-50 Contractor's sole remedyunder the Construction Contract, the Corporationwill paythe Construction Contractor for the Work completed to the effective date of the termination of the Contract as set forth belON pl us termination and close out costs and feethereon. With respect to suspensionConstruction Contractor will also beentitled to re-startup costs, premiumsand all other additional costs (including but not linited to subcontractorcosts) . Notwithstandingthe precedingtwo (2) sentences, in the event Construction Contractor otherwise is in material default of any material provision of the Contract, Corporation will have the right, after providing Construction Contractor with written notice and a seven (7) business-day period for Construction Contractor to undertake to cure such materialdefault, to suspend the Work or any portion thereof or to terni nate the Contract, provided Construction Contractor has not commenced undertaking to cure such material default to Corporation's satisfaction wi thi n such seven ( 7) business-day period. In the event of ( i) suspension of the Work or any portion thereof due to Construction Contractor' s faiI ure to timely perform any material obligation under the Contract, or any other material default by Construction Contractor under the Contract Documents, or ( i i) a termi nation of the Contract due to Construction Contractor' s faiI ure to timely perform any material obligation under the Contract, or any other material default by Construction Contractor under the Contract Documents, Construction Contractor will not be entitled to receive any further payment from Corporation until the Work is fully and finally completed as required bythe Contract Documents. U pon receipt of the notice of suspension or termination, Construction Contractor wi11 immediately, in accordance with Corporation's instructions, proceed with performance of the folI ONi ng duties: (1) Cease operationsas specified; (2) Place no further orders and enter into no further Subcontracts for materials, labor, servicesor faciIi ti es; (3) U nl ess otherwise specified, terninate or suspend ( as applicable) alI Subcontracts and orders to the extentthat theyrel ate to Work so terminated or suspended( as appl icable) ; (4) Campi ete the performance of the Work not terminated or suspended ( as applicable); and (5) Take such other actions as may be necessary or requested by Corporation for the protection and preservationof the terminated or suspended( as applicable) Work. In the event of terni nation for Corporation's convenience, Construction Contractor wi 11 be paid: (1) For Work properly performed on the terminated portion of the Work before the effectivedate of termination; (2) Reasonable demobilization and other costs directly related to such termination as describedin detaiI in invoicesand descriptions providedby Construction Contractor and approved by Corporation, which approvalwill not beunreasonably withheld; and

C-51 (3) The portionof the Construction Contractor Fee earned to the date of such termi nation and any overhead costs actually and reasonably incurred byt Construction Contractor after the commencement of the Work through the date of termination. (4) In determining amounts due Construction Contractor under this Paragraph, Corporation will be credited for payments previously made to Construction Contractor for the terninated portion of the Work and claims which Corporation has against Construction Contractor under the Contract, and for the value of materials, supplies, equipment or other items to be disposed of byt Construction Contractor that are covered under the GM P. If Construction Contractor has, prior to the date of ternination, collected sums tONard the Cost of the Work or Construction Contractor Fee in excess of the reimbursable amounts set forth above, Construction Contractor will promptly paysuch excessto Corporation or, at Corporation's option, such excesswi 11 bededucted.

C-52 APPENDIX D

FORM OF OPI NION OF BOND COUNSEL

[closing date]

Trustees of The Cal ifornia State U niversity Long Beach, California

Cal ifornia State University, Fresno Association, Inc. Fresno, California

California State University, Fresno Association, Inc. Auxiliary OrganizationEv ent Center Revenue Bonds, Senior Series 2002

and

California State University, Fresno Association, Inc. AuxiliaryOrga nization Event Center Subordi nate Revenue Bonds. Subordinate Series 2002 (Final Opinion)

Ladies and Gentlemen:

We have acted as bondcounsel in connection with the issuance bythe Cal ifornia State University, Fresno Association, Inc. (the "Corporation") of $69,475,000 aggregate principal arrnunt of California State University, Fresno Association, Inc. Auxiliary OrganizationEven t Center Revenue Bands, Senior Series 2002, and $5,000,000 aggregate pri nci pal arrnunt of Cal ifornia State University, Fresno Association, Inc. Auxiliary Organization Event Center Subordi nate Revenue Bonds, Subordinate Series 2002 (collectively, the "Series 2002 B ands'' ) , issued pursuant to an I ndenture, dated as of J anuary 15, 2002 the( " I ndenture'' ) , by and between the Corporationand U.S. Bank, N.A., as trustee (the "Trustee" ). Capitalized terms not otherwise defi ned herei n shal l have the meanings ascribed thereto in the I ndenture.

In such connection, we have reviewed the Indenture, certificationsof the Corporation, the Trustees of The California State University (the "Board" ), the Trustee and others as to certai n factual matters, a Tax Certificate of the Corporation dated the date hereof (the "Tax Certificate" ), opinions of counsel to the Corporation, the Board and the Trustee with respect to the Corporation, the Board and the Trustee, respectively, and such other documents, opinions and matters to the extent we deemed necessaryto render the opi nions set forth herei n.

Certain agreements, requi rementsand procedures contai ned or referred to in the I ndenture, the Tax Certificate and other relevant documents may be changed and certai n actions (including, without limitation, defeasance of Bonds) may betaken or orritted under the circumstances and subject to the terms and conditionsset forth in suchdocu ments. No opinion is expressed herei n as to any Bond or the interest thereon if any such change occurs or action is taken or omitted uponthe advice or approval of counsel other than ourselves.

The opinions expressed herein are based on an analysis of existi ng laws, regulations, rulings and court decisions and cover certain matters not di rectly addressed by such authorities. Such opinions may be affected by actions taken or omitted or events occurring after the date hereof. We have not undertaken to determine, or to inform any person, whether any such actions are taken or omitted or events do occur or any other matters come to our attention after the date hereof, and we disclai m any obligation to update this letter. We have assumed the genuineness of all documents and signatures presented to us (whether as originals or as copies) and the due and legal execution and delivery thereof by, and validity agai nst, any parties other than the Corporation. We have assumed, without undertaki ng to verify, the accuracy of the factual matters represented, warranted or certified in the documents, and of the legal conclusions contained in the opi nions, referred to in the second paragraph hereof. Furtherrrnre, we have assumed compliance with al l covenants and agreements contai ned in the Indenture and the Tax Certificate, includi ng (without limitation) covenants and ag reements compl iance with which is necessary to

D-1 assure that future actions, omissions or events wi ll not cause interest on the Series 2002 Bonds to be included in grossi ncorrE for federal incometax purposes.

We call attention to the fact that the rights and obl igations under the Bonds, the Indenture and the Tax Certificate and thei r enforceabi lity may be subject to bankruptcy, insolvency, reorganization, arrangerrEnt, fraudulent conveyance, moratori um and other laws relati ng to or affecting creditors' rights, to the appl ication of equitable pri nci ples, to the exercise of judicial di scretion in appropriate cases, and to the limitations on legal rerrEdies agai nst agencies of the State of California. We express no opinion with respect to any indemnification, contri bution, penalty, choice of law, choice of forum or waiver provisions contai ned in the foregoi ng documents nor do we express any opi nion with respect to the state or quality of title to or interest in any of the real or personal property described in or subject to the lien of the I ndenture or the Ground Lease or the accuracy or sufficiency of the descri ption contai ned therei n of, or the remedies avai lable to enforce liens on, any such property. Final ly, we undertake no responsi bility for the accuracy, completeness or fai rness of the Official Statement or other offeri ng material relati ng to the Series 2002 Bands and express no opinion with respectther eto.

Based on and subject to the foregoing, and in rel iance thereon, as of the date hereof, we are of the fol lowi ng opinions:

1. The Series 2002 Bonds constitute the val id and binding limited obl igations of the Corporation.

2. The Indenture constitutes theval id and bi ndi ng obi igation of the Corporation. In order to secure the pay ment of the pri nci pal of and interest on the Senior Bonds in accordance with their terms and the provi si ans of the I ndenture, and subordinate thereto to secure the payment of the principal of and interest on the Subordinate Bondsin accordance with their terms and the provisions of the Indenture, the Indenture creates a val id pledge of the Event Center Proj ect Revenues (as defi ned in the Indenture) and any other amounts (including proceeds of the sale of the Bands) held in any fund or account established pursuant to the I ndenture, except the Rebate Fund and except the Subordi nate Reserve Account which is pledged exclusively to and provides security solely for the Subordi nate Bands such that the Senior Bands have no security or other interest therei n, to the extent set forth in the Indenture and subject to the provisions of the Indenture permitti ng the application thereof for the purposes and on the terms andcon ditions set forth therei n.

3. The Bands are not ali en or charge uponthe fundsor propertyof the State of California or the Board, except to theextent of the aforerrEntioned pledge. Neither the fai th and credit nor the taxi ng power of the State of California or of any political subdivisionther eof is pledged to the pay ment of the principal of or interest on the Bands. The Bandsare not a debt of the State of California or the Board and neither is liable for the pay ment thereof.

4. Interest on the Series 2002 Bonds is excluded from gross income for federal income tax purposes under Section 103 of the Internal Revenue Code of 1986 and is exempt from all taxation in the State of Cal ifornia other than estate and generation skipping transfer taxes. I nterest on the Seri es 2002 Bands is not a specific preference item for purposesof the federal individual or corporate alternative minimum taxes, although we observe that such interest is included in adj usted current earnings when calculati ng corporate alternative minimum taxable income. We express no opinion regarding other tax consequences related to theow nership or dispositionof, or the accrual or recei pt of interest on, theB ands.

Faithfully yours,

ORRICK, HERRINGTON & SUTCLIFFE LLP

per

D-2 APPENDIX E

INFORMATION CONCERN! NG DTC

The follCMling description of the procedures and record-keeping with respect to beneficial ONn ership interests in the Series 2002 Bonds, payrrent of principal, interest and other payrrents on the Series 2002 Bonds to DTC Participants or Beneficial Owners, confirrmtion and transfer of beneficial CM1nershipinter ests in such Bonds and other related transactions bytand between DTC, the DTC Participants and the Beneficial Owners is based solely on infor rmtion provided byt DTC. Accordingly, no representations can be rmde concerning these rmtters and neither the DTC Participants nor the Beneficial Owners should rely on the follCMling inforrmtionwit h respect to such rmtters, but should instead confirmthe sarre with DTC or the DTC Participants, as the case rmy be.

DTC will act as securities depository for the Series 2002 Bonds. The Series 2002 Bonds will be issued as fully-registered bonds in the name of Cede & Co. (DTC's partnership norri nee). One fully-registered Bond will be issued for each maturity of the Series 2002 Bonds, each in the aggregate principal arrount of such maturity, and wi11 be deposited with DTC.

DTC is a limited-purpose trust company organized under the N01VYo rk Banking Law, a "banking organization" within the meaning of the N 0/VYo rk Banking Law, a member of the Federal ReserveSystem, a "clearing corporation" within the meaning of the N 0/VYo rk U ni form Commercial Code, and a "clearing agency" registered pursuant to the provisions of Section 17A of the Securities Exchange Act of 1934. DTC holds securities that its participants (the "Participants'') deposit with DTC. DTC also facilitates the settlement arrong Participants of securities transactions, such as transfers and pledges, in deposited securities through electronic computerized book-entry changes in Participants' accounts, therebyt eliminating the need for physical rrovement of securities certificates. Direct Participants include securities brokers and dealers, banks, trust companies, clearing corporations and certain other organizations. DTC is CMtned byt a number of its Direct Participants and byt the N01V York Stock Exchange, Inc., the American Stock Exchange, Inc. and the National Association of Securities Dealers, Inc. Access to the DTC system is also available to others such as securities brokers and dealers, banks, and trust companies that clear through or maintain a custodial relationship with a Direct Participant, either directly or indirectly ("Indirect Participants"). The Rules applicable to DTC and its Participants are on file with the Securities and Exchange Cammissi on.

Purchases of the Series 2002 Bonds under the DTC system must be made byt or through Direct Participants, which will receive a credit for the Series 2002 Bonds on DTC's records. The CMtnership interest of each B enefici al Owner is i n turn to be recorded on the Direct and Indi rect Participants' records. Beneficial Owners will not receive written confirmation from DTC of their purchase, but Beneficial Owners are expected to receive written confirmations providing details of the transaction, as wel I as periodic statements of thei r holdings, from the Direct or I ndirect Participants through which Beneficial Owners entered into the transaction. Transfers of CMtnership interests in the Seri es 2002 B onds are to be accomplished byt entries made on the books of Participants acting on behalf of Beneficial Owners. Beneficial Owners will not receive certificates representing their CMtnership interests in the Series 2002 Bonds, except in the event that use of the book-entry system for the Series 2002 B onds is discontinued.

To facilitate subsequent transfers, all Bonds deposited byt Participants with DTC are registered in the name of DTC's partnership nominee, Cede & Co. The deposit of Bonds with DTC and their registration in the name of Cede & Co. effect no change in beneficial CMtnership. DTC has

E-1 no knCMtledge of the actual Beneficial Owners of the Series 2002 Bonds; DTC's records reflect only the identity of the Direct Participants to whose accounts such securities are credited, which may or may not be the Beneficial Owners. The Participants will remain responsible for keeping account of thei r hol dings on behalfof their customers.

Conveyance of notices and other communications by DTC to Direct Participants, by Direct Participants to Indirect Participants, and by Direct Participants and Indirect Participants to Beneficial Owners wi11 be governed by arrangements among them, subject to any statutory or regulatory requirementswhich may be in effectfrom time to ti me.

Redemption notices will be sent to Cede & Co. If less than all of the Series 2002 Bonds within an issue are being redeemed, DTC's practice is to determine by lot the amount of the interest of each Direct Parti ci pant in such issue to be redeemed.

Neither DTC nor Cede & Co. will consent or vote with respect to the Series 2002 Bonds. Under its usual procedures, DTC mails an Omnibus Proxy to an issuer as soon as possible after the record date. The Omnibus Proxy assigns Cede & Co.'s consenting or voting rights to those Direct Participants to whose accounts the Series 2002 Bonds are credited on the record date (identified in a Iisting attached to the Omni bus Proxy).

Pri nci pal, mandatory si nki ng fund payments, preni um and interest payments on the Seri es 2002 Bonds will be made to DTC. DTC's practice is to credit Direct Participants' accounts on payment dates in accordance with their respective holdings shCMtn on DTC's records unless DTC has reason to believe that it will not receive payment on the date payable. Payments by Participants to B enefi cial Ownerswi 11 be governed by standing instructions and customary practices, as is the case with securities held for the accounts of customers in bearer form or registered in "street name," and will be the responsibility of such Participant and not of DTC, the Trustee or the Corporation subject to any statutory or regulatory requirements which may be in effect from time to time. Payment of principal and interest to DTC is the responsibility of the Corporation or the Trustee, disbursement of such payments to Direct Participants will be the responsibility of DTC, and disbursement of such paymentsto the Beneficial Owners will be the responsibility of Direct and Indirect Participants.

The Corporation and the Underwriters cannot and do not give any assurances that DTC, the Participants or others will distribute payments of principal, interest or prenium with respect to the Series 2002 Bonds paid to DTC or its noninee as the registered CMtner, or will distribute any redemption notices or other notices, to the B enefi ci al Owners, or that they wi11 do so on a ti mely basis or will serve and act in the manner described in this Official Statement. The Corporation and the U nderwriters are not responsible or Iiable for the faiI ure of DTC or any P arti ci pant to make any payment or give any notice to a Beneficial Owner with respect to the Series 2002 Bonds or an error or delay rel ati ng thereto.

DTC may discontinue providing its services with respect to the Series 2002 Bonds at any time by giving notice to the Trustee and discharging its responsibilities with respect thereto under applicable Iaw or the Corporation may terminate parti cipa.ti on in the system of book-entry transfers through DTC or anyother securities depository at any ti me. In the event that the book-entrysystem is discontinued, replacement Bond certificates will be printed and delivered as described in the Indenture.

E--2 APPENDIX F

FORM OF CONTINUING DISCLOSURE AGREEMENT

This Conti nui ng Disci osure Agreement (this " Disci osure Agreement'') is executed and delivered by the California State University, Fresno Association, Inc., a non-profit public benefit corporation, duly organized and existing under the Iaws of the State of California ( the "Corporation"), and U .S. Bank, N .A. organized and existing under the Iaws of the State of California, as Dissemination Agent (the" Dissemination Agent''), in connection with the executionand delivery of the Corporation'sAuxiliary Organization Event Center Revenue Bonds, Senior Series 2002and its Auxiliary Organization Event Center Subordinate Revenue Bonds, Subordinate Series 2002 (collectively, the "Bonds"). The Bonds are being issued pursuant to an Indenture dated as of J anuary 1 5, 2002 ( the "I ndenture"), byand betweenthe Corporationand U .S. Bank, N.A., as Trustee. The Corporationand the Dissemination Agent covenantas follONs: SECTION 1. Purpose of the Disclosure Agreement. This Disclosure Agreement is being executed and delivered by the Corporation and the Dissemination Agent for the benefit of the Owners of the B onds and in order to assist the P artici pating U nderwri ter in complying with S.E. C. Rule-1 5c-12(b)(5). SECTION 2. Definitions. In addition to the definitions set forth in the Indenture, which apply to any capitalized term used in this Disclosure Agreement unless otherwise defined in this Section, the folI ONi ng capitalized termsshal I have the folI ONi ng meanings: "Annual Report'' shalI mean anyAnnual Reportprovided bythe Corporationpursuant to, and as descri bedin, Sections3 and 4 of this Disci osure Agreement. "Disclosure Representative" shall mean the Executive Director of the Corporation or his or her designee, or such other officer or employee as the Corporation shall designate in writing to the Trusteefrom ti meto ti me. "Dissemination Agent'' shall mean U.S. Bank, N.A., acting in its capacity as Dissemination Agent hereunder, or any successor Dissemination Agent designated in writing by the Corporation and which has filed with the Dissemination Agent a written acceptanceof such designation. "Listed Events'' shalI mean any of the events Ii sted in Section5( a) of this Disci osure Agreement. "National Repository" shalI mean any Nationally Recognized M uni ci pal Securities I nforrration Repository for the purposeof the Rule. "ParticipatingUnderwriter'' shalI meanany of the original underwriters of the Bonds required to complywith the Rule in connectionwith offeringof the Bonds. "Repository"shall meaneach National Repositoryand each State Repository. "Rule" shall mean Rule 15c2-12(b)(5) adopted by the Securities and Exchange Commission under the S ecuri ties Exchange A ct of 1934, as the samerray beamended from time to time.

F-1 "State Repository" shall mean any public or private repository or entity designated by the State of California as a state repository for the purpose of the Rule. As of the date of this Agreement, there is no State Repository. SECTION 3. Provisionof Annual Reports. (a) The Corporation shall cause the Dissemination Agent to, not later than 180 days follONing the end of the Corporation's Fiscal Year, commencing with the Annual Report for the Corporation's Fiscal Year endingJ une 30, 2002, provideto each Repositoryan Annual Report which is consistent with the requirementsof Section 4 of this Disclosure Agreement. Not later than fifteen (15) Business Days prior to said date, the Corporation shall provide the Annual Report to the Dissemination Agent. In each case, the Annual Report may besubmitt ed as a single document or as separate documents comprising a package, and may include by reference other information as provided in Section 4 of this Disci osure Agreement; providedthat the audited fi nanci al statements of the Corporation may be submitted separately from and later than the balance of the Annual Report if they are not available by the date required above for the filing of the Annual Report. Notwithstanding anythingherein to the contrary, the Corporation shall provide all Annual Reports in a format suitable for reporting to the Repositories and the Dissemination Agent shall have no responsibility for preparing any Annual Report. The Dissemination Agent shall have no duty or obi igati on to revieN such Annual Report. (b) If by fifteen ( 15) Business Days prior to the date specified in subsection (a) for providingthe Annual Reportto R epositori es, the Dissemi nation A gent has not received a COP{of the Annual Report, the Dissemination Agent shall notify the Corporationof such failure to receive such report. (c) If the Dissemination Agent is unable to verify that an Annual Report has been providedto Repositories bythe date required in subsection(a), the Dissemination Agent shall send a notice to (i) each Repositoryand (ii) the Muni cipal Securi ti es R ul emaking B oard, in substantial ly the form attached as Exhibit A. (d) The Dissemi nation A gent shalI: (i) determine each year prior to the date for providing the Annual Report the nameand address of each National Repositoryand each State Repository, if any; and (ii) provided it has received the Annual Report pursuant to Section 3(a), file a report with the Corporation certifying that the Annual Report has been provided pursuant to this Disci osure Agreement, stati ng the date it was provided and Iisti ng alI the R epositori es to which it was provided. SECTION 4. Content of Annual Reports. The Corporation'sAnnual Report shall contain or i ncl ude byreference the folI ONi ng: (a) Financial Statements. The audited financial statements of the Corporation for the prior fiscal year, if any have been prepared and which, if prepared, shall be prepared in accordance with generally accepted accounting principles as promulgatedto apply to the Corporation from time to time by the Governmental Accounting Standards Board. If the Corporation is preparing audited financial statements and such audited financial statements are not available by the time the Annual

F-2 Report is required to be filed pursuant to Section3(a) , the Annual Report shall contain unaudited fi nanci al statements, and the audited fi nanci al statements shalI be fi Ied in the same manner as the Annual Reportwhen they becomeavai I able. In the event that the Corporationshal I rnx:lify the basis upon which its financial statements, if any, are prepared, the Corporation shall provide a notice of such rnx:lification to each Repository, including a reference to the specific federal or state law or regulation descri bi ng such accounting basis. (b) Other Reports. Any or all of the items listed above may be included by specific reference to other documents, including official statements of debt issues of the Corporation or related public entities, which have been subnitted to each of the Repositories or the Securities and Exchange (omni ssi on. If the document incl uded byreference is a fi nal official statement, it must be available from the MunicipalSecurities Rulemaking Board. The Corporation shall clearly identifyin the Annual Reporteach such other documentso incl uded by reference. ( c) Additional Informati on. The Corporation's Annual Reportshal I contai n: (i) an update on the status of construction of the Event Center Project; (ii) a statement of revenues, expenses and debt service coverage with respect to the Event Center Project in the form set forth in the OfficialStatement under the caption "REPORT OF FEASIBILITY CONSULTANT - Projected Event Center Project Revenues, Expenses and Debt ServiceCoverage" ; and (iii) information pertaining to the filing of any judicial lawsuit against the Corporation or otherwise knCMtn to the Corporation which will materially adversely affect the completion and/or operation of the Event Center Project, or litigation which would materially adversely affect the financial condition of the Corporation. SECTION 5. Reporting of Significant Events. (a) Pursuant to the provisions of this Section5, the Corporationshall give, or cause to be given, notice of the occurrenceof anyof the folI CMti ng events with respect to the B onds, if material: ( 1 ) principal and interest paymentdelinquencies. (2) non-paymentrelated defaults. (3) unscheduleddraws on the ReserveAccount reflecting financial difficulties. (4) unscheduleddraws on credit enhancementsreflecting financial difficulties. (5) substitution of credit or Ii quidi typroviders, or thei r faiI ure to perform. (6) adverse tax opinions or eventsadversely affectingthe tax-exempt status of the Bonds. (7) rnx:lificationsto rights of Bond Owners. (8) optional , conti ngent or unscheduled redemption of any B ond.

F-3 (9) defeasances. (10) release, substitution or sale of property securing repayment of the Bonds, including the Site Ieased bytthe Corporation. ( 11 ) rati ng changes. (b) The Corporationshall determine whether an event has occurredthat is rraterialwithin the meaning of the Rule. The Corporation shall, within one (1) Business Day of obtaining actual knCMtledge of the occurrence of any of the Listed Events, inform the Dissemination Agent of the event, and request that the Dissenination Agent report the event pursuant to subsection (f). The Dissemination Agent shall beentitled to rely conclusively uponthe determination of the Corporation or an opinion of B ond Counsel (obtained at the Corporation's expense) as to the rraterial i ty of any event. (c) Whenever the Corporation obtains knCMtledge of the occurrence of a Listed Event, the Corporation shall as soon as possible determine if such event would constitute rraterial i nforrration for Owners of B onds. (d) If the Corporationhas deterni ned that knCMtledge of the occurrenceof a Listed Event would constitute rraterial inf orrration for Owners of B onds, the Corporation shalI promptly notify the Dissemi nation A gent in writing. Such notice shalI instruct the Di ssemination A gent to report the occurrencepursuant to subsection (f) . (e) If in response to a request under subsection (b), the Corporation determines that the Listed Event would not be rraterial under applicable federal securitiesI aws, the Corporation shalI so notify the Di ssemi nation A gent in writing and instruct the Di ssemi nation A gent not to report the occurrence pursuant to subsection (f) . (f) If the Dissemination Agent has been instructed byt the Corporation to report the occurrence of a Listed Event, the Dissemination Agent shall file a notice of such occurrence with (i) the Municipal Securities Rulerraking board or (ii) the National Repository, and in either case to each State Repository. Notwithstanding the foregoing, notice of Listed Events described in subsections (a)(8) and (9) need not begiven under this subsectionany earlier than the notice (if any) of the underlying event is given to Owners of affected Bonds pursuant to the I ndenture. SECTION 6. Ternination of Reporting Obligation. The Corporation's obligations under this Disci osure Agreement shalI terninate uponthe Iegal def easance, prior redemption or payment in full of all of the Bonds or upon the delivery to the Dissemination Agent of an opinion of nationally recognized bond counsel to the effect that continuing di sci osure is no Ianger needed. If such ternination occurs prior to the final rraturity of the Bonds, the Corporation shall give notice of such ternination in the samemanner as for a Listed Event under Section5. SECTION 7. Dissemination Agent. The Corporation herebytappoints U.S. Bank, N.A. as the Dissenination Agent. The Dissemination Agent rray resign byt providing thirty days written notice to the Corporationand the Trustee. The Dissemination Agent shall not beresponsible for the content of anyreport or notice prepared bytthe Corporationor the Corporation.

F-4 SECTION 8. Amendment;Waiver. Notwithstanding any other provision of this Disclosure Agreement, the Corporation and the Dissenination Agent may amend this Disclosure Agreement (and the Dissemination Agent shall agree to any amendment so requested byt the Corporation provided, the Dissemination Agent shall not be obligated to enter into any such amendment that modifies or increases its duties or obligations hereunder), and any provision of this Disclosure Agreementmay bewaived, providedthat the follONingconditions are satisfied: (a) If the amendment or waiver relates to the provisions of Sections 3( a),4 or S(a), it may only be made in connection with a change in circumstances that arises from a change in legal requirements, change in law, or change in identity, nature or status of an obi i gatedperson with respectto the B onds, or the typeof busi ness conducted; (b) The undertaking, as amended or waived, would, in the opinion of nationally recognizedbond counsel, have complied with the requirements of the Rule at the timeof the original issuance of the B onds, after taking into account any amendments or i nterpretati ons of the Rule, as wel I as any change in circumstances; and (c) The proposedamendment or waiver either (i) is approved bytthe Owners of at least 25% of the Bonds outstanding, or (ii) does not, in the opinion of nationally recognized bondcounsel, materiallyimpair the interests of the Owners of the Bonds. In the event of any amendment or waiver of a provision of this Disclosure Agreement, the Corporation shall describe such amendment in the next Annual Report, and shall include, as applicable, a narrative explanation of the reason for the amendment or waiver and its impact on the type of financial informationor operating data being presented bytthe Corporation. Notwithstanding anything herein to the contrary, no amendment shall modify the rights or obligations of the Dissemi nation A gent without its prior written consent. SECTION 9. Additional Information. Nothing in this Disclosure Agreement shall be deemed to prevent the Corporation from dissemi nati ng any other information, using the means of dissemination set forth in this Disclosure Agreement or any other means of communication, or incl udi ng any other information in any Annual Report or notice of occurrence of a Listed Event, in addition to that which is required byt this Disclosure Agreement. If the Corporation chooses to include anyi nformati on in anyAnnual Reportor notice of occurrenceof a Listed Event in addition to that which is specifically required byt this Disclosure Agreement, the Corporation shall have no obligation under this Agreementto update such informationor include it in anyfuture Annual Report or notice of occurrenceof a Listed Event. SECTION 10. Default. In the event of a failure of the Corporation to comply with any provision of this Disclosure Agreement, the Participating Underwriter, or any Holder or Beneficial Owner of the Bonds may take such actions as may be necessary and appropriate, including seeking mandate or specific performance byt court order, to cause the Corporation to comply with its obligations under this Disclosure Agreement; provided that anysuch action maybe instituted only in the superiorcourt of the Stateof California in and for the Countyof Fresno or in U.S. District Court in or nearest to the County of Fresno. A default under this Disclosure Agreement shall not be deemed an Event of Default under the Indenture, and the sole remedy under this Disclosure Agreement in the event of any failure of the Corporation to comply with this Disclosure Agreement shalI bean action to compelperforman ce.

F-5 SECTION 11. Duties, Immunities and Liabilities of Trustee and Disserrination Agent. Article XI of the Indenture is hereb{ made appl i cable to this Disci osure Agreement as if this Disci osure Agreement were (solely for this purpose) contained in the Indenture and the Dissemination Agent shall be entitled to the protections, !irritations from liability and indemnities afforded the Trustee thereunder. The Disserrination Agent shall have only such duties as are specificallyset forth in this Disclosure Agreement, and the Corporationagrees to indemnifyand save the Disserrination Agent, its officers, directors, emplO{ees and agents, harmless against any loss, expense and liabilities which it may incur arising out of or in the exercise or performance of its pc:M1ers and duties hereunder, including the costs and expenses (including attorneys fees of outside counsel and the allocated costs and disbursements of in-house counsel) of defending against any claim of liability, but excluding liabilities due to the Dissemination Agent's negligence or willful misconduct. The obligations of the Corporation under this Section shall survive resignation or rerroval of the Dissemination Agent and payment of the Bonds. The Dissemination Agent shall have no liability for the failure to report any event or any financial information as to which the Corporation has not provided an information report in a format suitable for filing with the R epositori es. SECTION 12. Compensation. The Dissemination Agent shall be paid compensation b{ the Corporation for its services provided hereunder in accordance with its schedule of fees as amended from time to ti me pursuant to an agreement of both parties hereto and alI expenses, Iegal fees and advances made or incurred b{ the Dissemination Agent in the performance of its duties hereunder. The Dissemination Agent shall have no duty or obligation to revi01V any information provided to it hereunder and shall not be deemed to be acting in any fiduciary capacity for the Corporation, the Bondholders or any other party. The Disserrination Agent shall not have any liability to the Bondholders or any other party for any monetary damages or financial liability of any kind whatsoever related to or ari si ng from this Agreement except ari si ng from its CMtn negli gence or willful misconduct. The Corporation'sobligation under this Section 12 shall survivethe termination of this Agreementor the resignation or rerroval of the Disserri nation Agent. SECTION 13. Merger. Anyfinancial institution succeedingto all or substantially all of the Di ssemi nation A gent' s corporate trust busi ness shalI be the successor Dissemi nation A gent without the execution or fiIi ng of anypaper or anyfurther act. SECTION 14. Resignation or Terrrination. The Disserrination Agent may resign or the Corporation may terminate the Dissemi nation A gent upon 30 days' written notice. U pon the Dissemination Agent's resignation or termination, the Corporation may appoint a successor Dissemination Agent. If the Corporation fails to appoint a successor Dissemination Agent, the Corporation shal I act as the Dissemination Agent. SECTION 15. Beneficiaries. This Disclosure Agreement shall inure solely to the benefit of the Corporation, the Di sserrination A gent, the Parti ci pati ng U nderwri ter and Holders and Benefi cial Ownersfrom ti meto ti meof the B onds, and shalI create no rights i n anyother personor entity. SECTION 16. Notices. Any notices or communications to or arrnng any of the parties to this Disci osure Agreementshal I begiven to alI of the folI CMti ng and maybe given as folI CMts: If to the Corporation: California State University, Fresno Association,Inc. 2771 East Shaw Avenue Fresno, California 93710-8205

F--6 If to the Dissemination Agent: U.S. Bank, N.A. 550 South HopeStreet, S ui te 500 Los Angeles, California 90071 SECTION 17. Counterparts. This Disclosure Agreement may be executed in several counterparts, each of which shalI bean ori gi nal and al I of which shalI constitute but one and the same instrument. Dated: February 14, 2002 CALIFORNIA STATE UNIVERSITY, FRESNO ASSOCIATION, INC.

By: Authorized Representative

Dated: February 14, 2002 U.S. BANK, N.A., as Dissemi nation A gent

By: Its: Authorized Officer

F-7 EXHIBIT A

NOTICE TO REPOSITORIES OF FAILURE TO FILE ANNUAL REPORT

Na!l"E of Issuer: California State University, Fresno Association,Inc.

Nal1"E of Issue: $69,475,000 Auxiliary OrganizationEvent Center Revenue Bonds, Senior Series 2002 $5,000,000Auxiliary OrganizationEvent Center Subordinate Revenue Bonds, SubordinateSeri es 2002

Date of Issuance: February 14, 2002

NOTICE IS HEREBY GIVEN that the Corporationhas not provided an Annual Reportwith respect to the above-nall"Ed B onds as required by Section 3( a) of the Conti nuing Disci osure Agree!l"Ent dated as of January 15, 2002, by and between the Authority and U.S. Bank, N.A., as Dissemination Agent (the "Dissenination Agent"). The Corporation anticipates that the Annual Reportwill befiled by______.

Dated: ����������

U.S. BANK, N.A., as Dissemination Agent

By: Its:

cc: Authority

F--8