Agenda - Council - 11/21/2006 - Special

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and Muir haye not executed a Deyelopment f...greement on or before the Letter of Credit Delivery Date, either the City or Muir may terminate this ...'\greement by v/ritten notice to the other party in '.vhich case the parties 'Nill have no further contractual rights or obligations to one another under this ,Agreement./Purchase A2:reement will have to set forth the Citv's and Muir's a2:reement as to what will haooen in that case.' 5.6 Muir's f...cquisition of Title to Development Property, Muir has pro'/ided the City with copies of Purchase .^...greements evidencing Muir's right to purchase the Parcels described on the attached Exhibit B, and the City and Muir anticipate that Muir may enter into additional purchase agreements giving Muir the right to acquire additional portions of the Development Property both before the City and Muir execute the De'/elopment Agreement and after Muir and the City execute the Development Agreement. The Development A,greement will obligate the City to, upon Muir's "vritten request, dismiss the eminent domain proceedings with respect to any Parcel, or any portion of a Parcel, that is owned in fee by Muir; provided, the City's obligation to dismiss the eminent domain proceedings is conditioned upon Muir's granting the City an option to purchase the property the City dismisses from the eminent domain proceedings from Muir during the six month period following the expiration or earlier terminatiol1 of this f...greement or the Development .'\greement for a purchase price equal to Muir's actual acquisition cost paid to third parties for such property plus any out of pocket costs and expenses Muir incurred in connection '.vith the acquisition of the property from third parties provided such costs and expenses may not exceed 15% of the amount of Muir's actual cost of acquisition of the property. Letter of Credit. The Develooment A2:reement will obli2:ate Muir to deliver to the Citv. on or before .2007. an irrevocable letter of credit from U.S. Bank in the amount of $21,434,000 (the "Letter of Credit") to secure Muir's oerformance of Muir's obli2:ation to close on the Date of Closin2: oursuant to the terms of the Purchase A2:reement. The Purchase A2:reement and the Letter of Credit will authorize the Citv to draw on the Letter of Credit for the full amount of the Letter of Credit (or anv other lesser amount Muir actuallv owes to the Citv on the Date of Closin2: oursuant to the Purchase A2:reement) uoon the Citv's submission to U.S. Bank of: W A coo v of the original Letter of Credit; !hl The Citv's si2:ht draft in the amount of the draw: and ill A certificate executed the Citv's Citv Administrator certifvin2: that. under the terms of the Purchase A2:reement. Muir has a current obli2:ation to oav the Citv the amount set forth in the Citv's si2:ht draft. 1966223vRed; 1966223vl to 1919544v4; 11/16/06 5