Item 2: Adoption of Resolution 5017Authorizing Economic Development Project Revenue Bonds as Recovery Zone Facility Bonds to Finance Improvements and att A

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ATTACHMENT A REVISED OUTLINE OF TERMS: November 15, 2010 Redevelopment of Vacant Parcel Term #5 is the only one with a proposed change. All other terms are the same as approved by council on September 15, 2010. 1.Beam Development will transfer ownership of the Vacant Parcel to Bennett Management Company (BMC), or related legal entity. Financial consideration for the transfer will only include BMC’s assumption of the existing $404,000 Downtown Revitalization Loan Program (DRLP) loan. 2.The $404,000 DRLP loan will be subordinate to the bank loan, and terms of the DRLP loan will be restructured as needed to allow BMC to meet the bank’s loan-to-value and cash flow coverage requirements. 3.The City’s Recovery Zone Facility Bonds allocation of up to $8 million will be used by BMC to achieve a lower, tax-exempt interest rate on the bank loan. BMC will be responsible for the legal and transaction costs associated with the Recovery Zone Facility Bonds. 4.The Wells Fargo Bank loan would be serviced by payments from BMC and security for the loan will be provided by BMC as required by the bank. The City will not incur any moral or financial obligation, and will not be responsible for repaying or securing the bank loan or related Recovery Zone Facility Bonds. 5.The City will commit to occupy up to 10,000 square feet of office space in the new BMC 16,000 building, and guarantee an additional 10,000 square feet of office space. The City’s lease guarantee will be reduced as sufficient private lease commitments are achieved to satisfy the bank’s pre-leasing requirements. BMC will be required to provide evidence that satisfactory efforts to lease vacant space have been made. 6.A DRLP loan, not to exceed ten percent of the total project cost, will be considered to assist BMC in closing a defined gap resulting from the project proforma and the bank’s loan-to-value and cash flow coverage underwriting criteria. 7.BMC will assume Beam’s obligation to redevelop the Vacant Parcel by constructing the proposed mixed-use building consisting of approximately 50,000 square feet. The total project, estimated at approximately $11 million, will include ground floor retail, four floors of office space, and embedded or underground parking. 8.BMC will assume Beam’s obligation to move forward with the project in a timely manner, including assumption of the May 1, 2011 ready-to-proceed date included in the Beam Purchase and Sale Agreement. 9.In the event that ownership of the Vacant Parcel is transferred to BMC and development does not move forward within the designated timeline, the property ownership will revert back to the Urban Renewal Agency at no cost (other than satisfaction BMC’s note on the property). Sale of the property to another entity without prior approval from the Urban Renewal Agency will not be permitted. Z:\CMO\2010 Council Agendas\M101122\S1011222andattA.doc