Letter of Intent

8 | Page

[*Letterhead of purchaser or its authorizes broker or other agent]

[*Date]

Please note that this document is a generic template that may not be appropriate for all situations and circumstances. In addition, this document may be modified from time to time, at RACER's sole discretion, and posted on the RACER website when effective. Potential buyers should not assume that this generic document provides any guarantee to future terms for sale or lease.

PRIVILEGED AND CONFIDENTIAL

Revitalizing Auto Communities Environmental Response Trust

2930 Ecorse Road, Ypsilanti, MI 48197

Attention: Bruce Rasher, Redevelopment Manager

Re: Letter of Intent to Purchase Certain Real Property Located at [*address]

Dear Mr. Rasher:

On behalf of Purchaser,[1] I submit this Letter of Intent (LOI) to identify certain material terms of Purchaser’s proposal to purchase the Property described below from Seller.

Purchaser: / [*Legal name of purchaser], a [*type of entity and state of formation], having its principal place of business at [*address]
Seller[2]: / [*Revitalizing Auto Communities Environmental Response Trust, a Trust created under the laws of New York State or RACER Properties LLC, a Delaware limited liability company] (“RACER”).
Property: / Approximately [*#] acres of land, located at [*address] and referenced as Property Number [*#] in Appendix A of the Settlement Agreement.
Purchase Price: / $[*#].
Deposit: / Within 5 Business Days following execution and delivery of the Purchase and Sale Agreement, Purchaser shall deposit with the Escrow Agent $[*#] which is 10% of the Purchase Price (“Deposit”).
Condition; Inspection: / With the exception of RACER’s continuing Environmental Activities, the Property is being sold in its “as is” and “whereas” condition, with no representations or warranties by Seller, except as set forth on Exhibit B annexed hereto. Purchaser may access the Property to inspect and conduct its Diligence Review, as described in Exhibit B.
Closing Date: / The Closing shall occur within 30 days after the Inspection Period in accordance with Exhibit B.
Title: / Seller shall convey to Purchaser fee simple title to the Property, subject to no Liens except for Permitted Liens, and as described in Exhibit B.
Zoning & Land Use Matters: / Seller makes no representation or warranty with respect to zoning or permitted use of the Property, except as specifically set forth in Exhibit B.
Environmental Matters: / Seller makes no representation or warranty with respect to the environmental matters pertaining to the Property except as specifically set forth in Exhibit B. Purchaser will provide post-Closing access to the Property to Seller to conduct its Environmental Activities, as described in Exhibit B.
Property Taxes and Closing Costs: / Property Taxes, Closing costs and any other apportionments shall be treated at Closing as set forth in Exhibit B.
Assignment: / Purchaser may not assign this LOI without Seller’s prior written consent, to be granted or withheld in its sole discretion.
Diligence: / Seller and Purchaser shall provide each other with copies of all Diligence, as required in Exhibit B. Such Diligence, and this Letter of Intent, are deemed Confidential Information, subject to the Confidentiality Agreement.
Purchase Agreement: / Within 5 Business Days following the execution and delivery to Seller of this LOI, Seller shall provide the Purchase and Sale Agreement. The undersigned hereby represents that it has read the Model Purchase and Sale Agreement currently published on RACER’s website, and agrees that the Purchase and Sale Agreement shall be in substantially the form of such model Purchase and Sale Agreement, as may be modified in Exhibit B.
Broker’s Authorization & Fees: / Seller shall pay any commission due to Seller’s Broker and shall have no Liability for any commission payable to Purchaser’s Broker or any other broker.
Paragraph 65: / Purchaser acknowledges that its proposal must satisfy the Sales Criteria, which Sales Criteria are incorporated herein by reference. Purchaser shall include in this LOI, by attaching as Exhibit C hereto, such information and responses to the requisite Sales Criteria, as is necessary to demonstrate, in Seller’s sole discretion, that its proposal herein meets such Sales Criteria.
Authorization: / The undersigned is duly authorized and empowered to enter into this LOI on behalf of Purchaser.
Non-Binding Agreement: / This LOI broadly outlines certain material terms of the Proposal for discussion purposes only. It shall have no binding force or effect, nor confer any rights or impose any obligations upon any party, unless and until the execution and delivery of the Purchase Agreement. The undersigned acknowledges that it is Seller’s intent to explore alternative potential purchasers for the Property.
Effective Date: / The date on which the latter of the two -- Purchaser and Seller -- executes this Letter of Intent.

Please indicate your acceptance by executing in the space provided below and distributing one executed copy to all Parties and brokers on or before Noon EST [*date], 2011. In the event that Purchaser has not received Seller’s acceptance by that time, this Agreement shall be deemed null and void.

Sincerely,

[*Purchaser name]

By: ______

Name:

Title:

Revitalizing Auto Communities
Environmental Response Trust
[*Revitalizing Auto Communities
Environmental Response Trust
or RACER Properties LLC][3]
By: ______
Name: Date
Title:


Exhibit A

Defined Terms

The following terms shall have the meaning ascribed thereto below, where used in this Letter of Intent, including any other Exhibit hereto, or document delivered pursuant hereto (to the extent not defined therein). Any other capitalized terms used in this LOI which are not defined here, shall have the meaning ascribed thereto in the Settlement Agreement.

(a)  “Access Agreement” means an agreement in form acceptable to the Parties, pursuant to which Purchaser shall be granted access to the Property prior to the [*execution of the Purchase and Sale Agreement or Closing] to inspect the Property and conduct its Diligence Review.
(b)  “Business Day” means any day other than (i) a Saturday, Sunday or federal holiday or (ii) a day on which commercial banks in [Detroit, MI], are authorized or required to be closed for all or any portion of the normal business hours of the day.
(c)  “Claim” means any claim, action, cause of action, suit, inquiry, judicial and administrative proceeding, determination, hearing, order, decree, judgment, settlement, grievance, mediation or arbitration.
(d)  “Closing” means the date on which the Sale is consummated in accordance with the Purchase Agreement.
(e)  “Confidentiality Agreement” means the Confidentiality Agreement signed and delivered by the Parties.
(f)  “Confidential Information” means as defined in the Confidentiality Agreement signed and delivered by the Parties.
(g)  “Diligence” means any and all Confidential Information of Seller pertaining to the Property and its condition, use and title.
(h)  “Diligence Review” means any and all inspections and assessments of the Property and the physical condition thereof and title thereto, including without limitation, engineering reports, survey, environmental site assessments and title reports, but excluding in any event, any Invasive Work, unless expressly authorized by Seller and in accordance with the conditions thereof.
(i)  “Environmental Actions” means any response, removal, investigation, sampling, remediation, reclamation, closure, post-closure, corrective action, engineering controls, institutional controls, deed restrictions, overnight costs and OMM activities authorized or required under Law with respect to the Property.
(j)  “Environmental Activity” means any and all Environmental Actions which RACER has undertaken, and/or may undertake, on, under or at the Property (or any portion thereof) to address any and all Existing Environmental Conditions for which RACER is responsible under the Settlement Agreement, including such monitoring, testing and other activities as are required or reasonably appropriate to achieve regulatory approval or closure in connection therewith, all as Seller shall agree, in its sole discretion, with appropriate Agencies.
(k)  “Environmental Condition” means any Release or other event, circumstance and/or condition existing at, on, in or under the Property, or the ambient air around the Real Property.
(l)  “Environmental Easement Agreement” means that certain Environmental Easement and Use Restriction Agreement to be entered into between Seller and Purchaser as a condition to Closing, which Environmental Easement Agreement, among other things, will set forth any Restrictions applicable to the Property in connection with the Environmental Activities, and grants to Seller post-Closing access to the Property to conduct and complete such Environmental Activities.
(m)  “Environmental Law” means any and all Laws relating to pollution, noise and/or odor control, wetlands pollution, the protection or restoration of health, safety or the environment, natural resources, and/or the use, transportation, presence, storage, handling, disposal, discharge, recycling, treatment, generation, processing, labeling, production, release, contamination or disposal of threatened Release of Hazardous Substance, including, without limitation, the following: (a) the Clean Air Act, 42 U.S.C. Section 7401; (b) the Resource Conservation and Recovery Act, 42 U.S.C. Section 6901 et seq.; (c) the Comprehensive Environmental Response Conservation and Liability Act, 42 U.S.C. Section 9601 et seq.; (d) the Federal Water Pollution Control Act, 33 U.S.C Section 1251 et seq.; (e) the Toxic Substances Control Act, 15 U.S.C. Section 2601 et seq.; (f) the Safe Drinking Water Act, 42 U.S.C. Section 300f et seq.; (g) OSHA, 29 U.S.C. 651 et seq.; (h) the Emergency Planning and Community Right to Know Act, 42 U.S.C. Section 11001 et seq.; and (i) the Oil Pollution Act of 1990, 33 U.S.C. Section 2701 et seq.; as any of the foregoing has been, and may be, amended, supplemented and/or replaced from time to time, as in effect on the date hereof, and including the analogous Laws of the State and applicable local Law or applicable Tribal Law.
(n)  “Existing Environmental Condition” means any Environmental Condition existing as of the date hereof for which Seller is obligated to perform Environmental Actions under the Settlement Agreement.
(o)  “Force Majeure” means any act of God, war,terrorism, civil commotion, governmental embargo or moratorium,casualty, labordispute not within the direct control ofa Party, unavailability or shortages of labor, materials or equipment which would not reasonably be foreseeable, or any other cause or event which would not reasonably foreseeable or is beyonda Person’s reasonable ability to control (except financial inability or matters arising from or related to a default, with respect to any defaulting Party).
(p)  “Governmental Authority” means any federal, tribal, state or local governmental or quasi-governmental authority, body, department, commission, board, bureau, agency, division, court or other instrumentality, whether foreign or domestic, of any country, nation, republic, federation or similar entity or any state, county, parish or municipality, jurisdiction or other political subdivision thereof.
(q)  “Hazardous Substances” shall have the meaning set forth in the Settlement Agreement.

(r)  “Inspection Period” means the time period within which Purchaser has to conduct and complete its Diligence Review with respect to each phase thereof (an Inspection Period), and collectively (the Inspection Period); provided that the Inspection Period shall expire on [*Outside Date], unless otherwise extended in accordance herewith.

(s)  “Intended Use” means industrial redevelopment uses only, as defined under applicable Environmental Laws.

(t)  “Invasive Work” means, collectively, any physically intrusive work, such as boring, drilling, sampling, moving, disturbing or removing any portion of the Property or otherwise affecting the Property.

(u)  “Laws” means all applicable laws, statutes, ordinances, rules, regulations, codes, Permits, judgments, administrative or court orders, decrees, injunctions, technical or other standards, policies, determinations, writs, and other requirements of any Governmental Authority, having jurisdiction over the Property, or the use or operation thereof, together with any applicable Executive Order of the President of the United States and common law.

(v)  “Letter of Intent” or “LOI” means the Letter of Intent to which this Exhibit A is attached.

(w)  “Liens” means, with respect to the Property (or any portion thereof, or interest therein), any mortgage, lien (statutory or otherwise), Claim, pledge, charge, option, assessment, levy, easement, covenant, condition, reservation, restriction, right-of-way, exception, limitation, violation, charge, security interest or other encumbrance affecting the Property or any portion thereof or interest therein.

(x)  “OMM” means the operation, monitoring and maintenance activities required under the Settlement Agreement as Environmental Action.

(y)  “Parties” means Seller and Purchaser, collectively.

(z)  “Permits” means all licenses, permits, approvals, authorizations, certificates and consents pertaining to the Access, and the use and/or performance of any work required by any Governmental Authority in connection therewith, including, without limitation, state and local health and environmental department licenses, or otherwise required by Law in connection therewith.

(aa)  “Permitted Liens” means any and all Liens and other matters affecting, or which may affect, title to the Property (or any portion thereof), or which would otherwise be disclosed by an accurate survey or visual inspection of the Property, including without limitation: (A) Liens existing as of the date title to the Property was conveyed to Seller, except as otherwise provided under the Purchase and Sale Agreement; (B) Utility easements and other access easements, licenses and rights of way entered into in the ordinary course of Seller’s management of the Property or conduct of any Environmental Activities; (C) Liens of which the conveyance of the Property to Seller was ordered by the Bankruptcy Court to be made free and clear; (D) Liens which would not reasonably be expected to have a material adverse effect on the Property for the Intended Use; and (E) any and all Restrictions provided under the Purchase Agreement; but excluding any and all (i) monetary Liens for a liquidated sum, to the extent such Liens were created by or on behalf of Seller; (ii) Liens in favor of the United States Treasury; and (iii) Liens for which Seller is responsible for removing or causing to be insured over, under the Purchase and Sale Agreement.

(bb)  “Property Taxes” means all taxes, assessments (including all assessments for public improvements or benefits), excises, levies, fees, charges, water, sewer or similar rents, rates and charges (including county, school, town and special district taxes), together with associated inspection fees of any kind or nature whatsoever, general or special, ordinary or extraordinary, foreseen or unforeseen, secured or unsecured, whether or not now customary or within the contemplation of Seller and Purchaser, that are levied, assessed, charged, confirmed, or imposed by any Governmental Authority on or against, or otherwise with respect to, the Property and/or the use, operation and occupancy thereof (and any tax, assessment, excise, levy, fee, or charge levied wholly or partly in lieu thereof or as a substitute therefor).