"But according to court documents, Katz Group and Boyle Street also signed an agreement for a "backstop gift," agreeing that if Boyle Street was unable to meet its fundraising goal on its own during the campaign, the Katz Group would give it an extra $5 million.
The gift amount would decrease on a dollar-for-dollar basis if Boyle Street was able to raise at least $8.5 million on its own."
The wording is a bit wonky, but sounds like the Katz group agreed to give them $5M if they raised up to $8.5M, then reduce the donation for every dollar over (i.e. if they raised $13.5M they wouldn't give them a top up). The goal was $28M, if they could move ahead with a third of that probably had some kind of stretch goals for that, and a basic plan for the $8.5M.
The $8.5M was apparently the minimum needed to go ahead, so if the group raised $3.5M the top up would get them moving forward.
Sounds messy but why arbitration exists.