02-26-07 Item 7A, Preliminary Development Agreement

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WHEREAS, the parties further expect that the City, upon acquisition of the Development Property from GSA, will simultaneously convey the Development Property to Developer pursuant to the terms of a master development agreement ("MDA") to be negotiated as further described herein; and WHEREAS, in light of such expected real estate transaction, the City has also entered into that certain Funding and Guaranty Agreement with Developer, Ryan Companies, Inc. ("Ryan") and Rehbein Companies, Inc. ("Rehbein") dated as of August 10, 2006, as amended by a First Amendment thereto dated , 2007, and as it may be further amended from time to time (the "Guaranty"); and WHEREAS, Ryan and Rehbein are the principals of Developer, and those three entities entered into the Guaranty in order to evidence their obligation to pay all earnest money and the Purchase Pricc (as defined in the Guaranty) required to be paid by the City to GSA under the OTP; and WHEREAS, under the terms of the Guaranty, the City and Developer agreed to negotiate the tenus of an MDA concerning the Development Property and the parties' respective responsibilities in developing such property and setting forth those matters that need to be completed prior to closing on the acquisition of the Development Property under the OTP (referred to hereafter as the "Closing"); and WHEREAS, the parties have determined to describe their respective responsibilities prior to Closing; and WHEREAS, the City Council has adopted an overall concept plan for the Development Property, designated as the TCAAP Framework Vision approved by the City Council on January 13,2005 and attached hereto as Exhibit B, and as it may be refined and amended from time to time (the "Framework Vision"); and WHEREAS, the City's Economic Development Commission and City Council have adopted a TCAAP Public Financing Policy (the "Public Financing Policy"), setting forth the general principles that will guide the City's financial participation in the Development; and WHEREAS, the Developer proposes to redevelop the Development Property as a mixed- use project consisting of residential uses with compatible and mutually supporting office, retail, services, hotel, community and civic use, office/warehouse and other uses (referred to generally as the "Development"); and WHEREAS, the City Council has acknowledged the Developer's desire to enter into this Preliminary Development Agreement to allow the Developer to further refine its proposal and to negotiate with the City concerning the redevelopment described in this Agreement; and WHEREAS, the City and the Developer acknowledge that the purchase and redevelopment of the Development Property is mutually beneficial to City and Developer, and therefore the parties desire to proceed with the Development if the conditions described herein are satisfied. 2