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Section 4.5. Determination of Land Prices. (a) The following shall apply to the determination of the cost of Parcels whenever Project Costs are required to be calculated under this Agreement: (1) The cost of any Parcel acquired by the Redeveloper or by any equity owner of the Redeveloper on or before December 31, 2001 shall be determined by an appraisal or other method acceptable to both Parties, based on such Parcel's pre-redevelopment use. (2) (i) The cost of any Parcel acquired after December 31, 2001 by the Redeveloper or by any of its equity owners from an unrelated party in an arm's length transaction shall be the price paid for the Parcel and attorneys' fees and other transactional costs associated therewith, plus reasonable carrying costs. Carrying costs are those expenses directly related to the holding of the Parcel (including interest on acquisition indebtedness, property taxes, insurance, repairs and maintenance, but not predevelopment costs related to the Project) and reduced by any revenues received on the Parcel. Only actual cash expenses are allowed. No amounts for depreciation, amortization or other non-cash items are allowed. The cost of the Parcel plus the net allowed carrying costs cannot exceed the fair market value of the property on the date of execution of this Agreement. The Redeveloper will certify to the City that such party would be considered unrelated to the Redeveloper or to any of its equity owners under applicable Code regulations. (ii) Predevelopment costs are costs incurred by the Redeveloper or by one of its equity owners which are contemplated by the Sources and Uses, including but not limited to costs such as fees of architects, engineers and environmental consultants, that are associated with the overall development of the Project but not with the acquisition or holding of particular Parcels. Although predevelopment costs are not included in carrying costs related to a Parcel, they are included in Project Costs. (3) The cost of any Parcel acquired after December 31, 2001 by the Redeveloper or by any of its equity owners from a related party (as defined in applicable Code regulations), not including for this purpose any land received by the Redeveloper as a contribution of capital from an equity owner of the Redeveloper, will be determined by agreement between the City and Redeveloper or, if agreement cannot be reached, the cost shall be determined by an appraisal or other method acceptable to both Parties. (b) The following methods will be used to determine land sales proceeds for the purposes of Section 4.4 and whenever Project Revenues are required to be calculated under this Agreement: (1) If the Redeveloper sells property (improved or unimproved) to an unrelated party in an arm's length transaction, that price will be determinative. The Redeveloper will provide an unrelated party certification as set forth in subparagraph (a)(2) above. 18