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City. The City reserves the right to draw,in whole or in part,on any <br /> portion of the Irrevocable Letter of Credit for the purpose of guaranteeing <br /> the terms and conditions of this contract. The Irrevocable setter of Credit <br /> shall be automatically extended for additional periods of one year from <br /> present or future expiration dates. <br /> B. The Developer may request reduction of the Letter of Credit,or cash <br /> deposit based on prepayment or the value of the completed improvements <br /> at the time of the requested reduction. The City may retain a minimum <br /> value to guarantee and assure that unfinished improvements can be <br /> completed. Prior to the final acceptance of the Developer's Improvements <br /> the City shall require a Letter of Credit or Cash Escrow to cover the <br /> warranty provisions of the agreement.The amount shall be determined by <br /> the City Engineer. <br /> VI. REIMBURSEMENT OF COSTS. <br /> A. The Developer agrees to establish a non-interest bearing escrow account <br /> with the City in an amount established by the City Engineer or his <br /> designee for the payment of all City fees and costs incurred by the City <br /> related to the On-site and off-site Work,including, but not limited to,the <br /> following: <br /> • crow Account $5 000.00 <br /> Estimated ud et Costs far Es <br /> Total Estun (B g ) <br /> Administration(Legal,Engineering,Planning, and <br /> Contract administration) <br /> Existing project escrow as of August 10,2011 $1,550.00 <br /> Additional escrow deposit required: $3,450.00 <br /> B. The City shall have a right to reimburse itself from the Escrow. Upon <br /> request,the City shall provide the Developer written notice and reasonably <br /> detailed invoices of the City's expenses charged to the escrow. If it <br /> appears that the actual costs incurred will exceed the estimate,then <br /> Developer and City shall review the costs required to complete the project. <br /> In such case,Developer shall deposit additional sums with the City to pay <br /> for the agreed upon increase. If the escrow account drops below 10%of <br /> the original deposit amount,the City may require the submittal of an <br /> additional escrow deposit sufficient to cover any anticipated expenses. <br /> VII. REMEDIES FOR BREACH <br /> A. The City shall give prior notice to the Developer of any default hereunder <br /> before proceeding to enforce such financial guarantee or before the City <br /> undertakes any work for which the City will be reimbursed through the <br /> financial guarantee. If within ten(10)days after such notice to it,the <br /> Developer has not notified the City by stating in writing the manner in <br /> page 5 of 9 <br />