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Optionee waives its objections and elects to proceed to Closing, the New Exceptions shall be deemed to be Permitted Exceptions and Optionee shall not be entitled to any reduction in the Purchase Price. In the event that Owner fails to deliver Owner's response notice to Optionee as set forth in this Paragraph 5(b), Owner shall be deemed to have elected not to remove the New Exceptions. If prior to the end of the Decision Period Owner advises Optionee that Owner is willing to remove the New Exceptions, then Owner thereafter shall cause the New Exceptions to be removed by the Closing Date. Notwithstanding the foregoing, Owner shall be required to remove at its sole cost any New Exceptions that constitute Owner Removal Items, irrespective of whether Optionee expressly has objected to such exceptions or items. (c) Title Delivered at Closing. By executing the Grant Deed, Owner shall convey to Optionee (or to such other person or entity as Optionee may designate) marketable fee title to the Real Property subject only to the Permitted Exceptions. Immediately following recordation of the Grant Deed, Escrow Holder shall issue to Optionee an ALTA extended coverage owner's policy of title insurance (2006 form), with coverage in the amount of the purchase price for the Real Property, showing fee simple title to the Real Property vested in Optionee, subject only to the Permitted Exceptions (the "Title Policy "). (d) Personal Property Encumbrances. To the extent that any of the Personal Property is encumbered by Uniform Commercial Code financing statements or other liens or encumbrances ( "Personal Property Encumbrances "), Owner shall cause such Personal Property Encumbrances to be released or otherwise removed prior to the Closing. 6. Liquidated Damages. OPTIONEE AND OWNER AGREE THAT IF OPTIONEE EXERCISES THE OPTION PURSUANT TO PARAGRAPH 2(c) AND THEREAFTER DEFAULTS ON ITS OBLIGATION TO PURCHASE THE PROPERTY PURSUANT HERETO, THE DAMAGES TO OWNER WOULD BE DIFFICULT AND IMPRACTICAL TO DETERMINE. ACCORDINGLY, IN THE EVENT OF SUCH DEFAULT BY OPTIONEE, OPTIONEE AND OWNER HAVE AGREED TO FIX AS LIQUIDATED DAMAGES THE DEPOSITS, BUT ONLY TO THE EXTENT THE DEPOSITS HAVE THERETOFORE BEEN DEPOSITED WITH ESCROW HOLDER OR PAID DIRECTLY TO OWNER, AND SUCH DEPOSITS SHALL BE RETAINED BY OWNER AS LIQUIDATED DAMAGES, AND SHALL CONSTITUTE OWNER'S SOLE AND EXCLUSIVE REMEDY FOR SUCH DEFAULT. OWNER'S RETENTION OF SUCH DEPOSITS AS LIQUIDATED DAMAGES IS NOT INTENDED AS A FORFEITURE OR PENALTY UNDER CALIFORNIA CIVIL CODE SECTIONS 3275 OR 3369, BUT INSTEAD IS INTENDED TO CONSTITUTE LIQUIDATED DAMAGES TO OWNER PURSUANT TO SECTIONS 1671, 1676 AND 1677 OF THE CALIFORNIA CIVIL CODE. OWNER HEREBY WAIVES THE PROVISIONS OF CALIFORNIA CIVIL CODE SECTIONS 1680 AND 3389. OWNER AGREES THAT THESE LIQUIDATED DAMAGES SHALL BE IN LIEU OF ANY OTHER MONETARY RELIEF OR OTHER REMEDY, INCLUDING WITHOUT LIMITATION SPECIFIC PERFORMANCE, TO WHICH OWNER OTHERWISE MIGHT BE ENTITLED UNDER THIS AGREEMENT, AT LAW OR IN EQUITY. OPTIONEE AND OWNER SPECIFICALLY ACKNOWLEDGE THEIR AGREEMENT TO THE FOREGOING LIQUIDATED DAMAGES PROVISION BY INITIALING THIS PARAGRAPH IN THE APPROPRIATE SPACES PROVIDED BELOW. Option Agreement 70 Chemical 10.05.2010 v.5 8